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+Prospectus Summary 1
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your
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+This summary highlights information contained elsewhere in this prospectus, but it does not contain all of the information that you may consider important in making your investment decision. Therefore, you should read this entire prospectus carefully, including, in particular, the Risk Factors section beginning on page 21 of this prospectus. As used in this prospectus, unless the context otherwise requires or indicates, references to the Company, we, our and us refer to Century Communities, Inc. and its subsidiaries and affiliates, including our predecessor Century Communities Colorado, LLC; and references to Century LLC or our predecessor refer to Century Communities Colorado, LLC and (except for financial statement information, except as otherwise noted) its predecessors and affiliates. Unless otherwise indicated, all market data included in this prospectus is derived from a market study, based on the most recent data available as of February 2014, prepared for us in connection with this offering by John Burns Real Estate Consulting, LLC (which we refer to as JBREC ), an independent research provider and consulting firm focused on the housing industry. Unless the context otherwise requires, the information in this prospectus assumes that: (i) we will issue shares of our common stock in this offering; (ii) the shares of our common stock to be sold in this offering are sold at $24.50 per share, which is the midpoint of the price range set forth on the cover page of this prospectus; and (iii) the underwriters over-allotment option to purchase additional shares of our common stock in this offering is not exercised. Our Company We are engaged in all aspects of homebuilding, including land acquisition and development, entitlements, and the acquisition, development, construction, marketing, sale and management of various residential projects in major metropolitan markets in Colorado, and, more recently, in the greater Austin and San Antonio, Texas and Las Vegas, Nevada metropolitan areas. Our business strategy is focused on the design, construction and sale of single-family detached and attached homes in major metropolitan markets, including in Colorado, Texas, and Nevada, and our planned entry into other markets in the Western United States. We offer a wide variety of product lines that enable us to meet the specific needs of each of our core markets (Denver, Fort Collins, and Colorado Springs, Colorado, Austin and San Antonio, Texas, and Las Vegas, Nevada), which we believe provides us with a balanced portfolio and an opportunity to increase market share. Since our formation, we have delivered over 2,700 homes for total revenues of approximately $750 million. In 2013, we were one of the top 50 largest homebuilders in the United States by total revenue (as ranked among public and private companies by Builder Magazine) and one of the top 5 fastest growing homebuilders by total revenue. We have been profitable every year since our founding, including throughout the recent economic downturn. Since 2008, our home sales revenue has more than tripled even as some homebuilders experienced significant revenue contraction. During that same period, many of our competitors were forced to exit the business or undergo significant restructuring. For the three months ended March 31, 2014, we delivered 128 homes for total home sales revenue of $49.7 million, up 101% from $24.7 million over the three months ended March 31, 2013, and for the year ended December 31, 2013, we delivered 448 homes for total home sales revenue of $171.1 million, up 78.2% from $96.0 million over the year ended December 31, 2012. The dollar amount of our backlog of homes sold but not closed as of March 31, 2014, December 31, 2013 and December 31, 2012 was approximately $122.3 million, $103.3 million and $51.6 million, respectively. As of April 1, 2014, we owned and controlled approximately 99 communities containing 10,095 lots in various stages of development. We seek to maximize our return on capital and reduce our risk exposure associated with holding land inventories by developing projects with targeted life cycles of approximately 24 to Table of Contents EXPLANATORY NOTE This Registration Statement contains two forms of prospectuses: (1) IPO Prospectus. A prospectus (which we refer to as the IPO Prospectus ) to be used in connection with the initial public offering of our common stock. We are offering 4,000,000 shares of our common stock (4,672,000 shares if the underwriters exercise in full their over-allotment option to purchase 672,000 additional shares of our common stock), and the selling stockholders named in this prospectus are offering 480,000 shares of our common stock, through the underwriters named on the cover page of the IPO Prospectus. (2) Selling Stockholders Resale Prospectus. A prospectus (which we refer to as the Selling Stockholders Resale Prospectus ) to be used by selling stockholders for the resale of 11,595,000 shares of our common stock. The Selling Stockholders Resale Prospectus is substantively identical to the IPO Prospectus, except for the following principal differences: (a) the Selling Stockholders Resale Prospectus has different front and back covers than the IPO Prospectus; (b) all references in the IPO Prospectus to this offering will be changed to the IPO, defined as the underwritten initial public offering of our common stock, in the Selling Stockholders Resale Prospectus; (c) all references in the IPO Prospectus to underwriters will be changed to underwriters of the IPO in the Selling Stockholders Resale Prospectus; (d) all references in the IPO Prospectus to $24.50 per share, which is the midpoint of the price range set forth on the cover page of this prospectus will be changed to $24.50 per share, which is the midpoint of the price range set forth on the cover page of the IPO Prospectus in the Selling Stockholders Resale Prospectus; (e) the following sections in the Selling Stockholders Resale Prospectus are different than the corresponding sections in the IPO Prospectus: Summary The Offering ; Use of Proceeds ; Selling Stockholders ; Description of Capital Stock Registration Rights Agreement ; Shares Eligible for Future Sale General ; and Legal Matters ; (f) the following sections in the IPO Prospectus are deleted from the Selling Stockholders Resale Prospectus: Summary Selling Stockholders ;
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0000919745_midatech_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0000919745_midatech_prospectus_summary.txt
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+Prospectus Summary The following summary is qualified in its entirety by, and should be read together with, the more detailed information and financial statements and related notes thereto appearing elsewhere or incorporated by reference in this prospectus. Before you decide to invest in our securities, you should read the entire prospectus carefully, including the risk factors and the financial statements and related notes included or incorporated by reference in this prospectus. Company Overview We are a North Carolina-based specialty pharmaceutical company primarily focused on the commercialization of oncology treatment and oncology supportive care pharmaceutical products. Through our acquisition of Oncogenerix, Inc., which occurred on January 17, 2012, we acquired exclusive U.S. marketing rights to our first commercial proprietary product, Soltamox (tamoxifen citrate) oral solution. Soltamox has been approved by the U.S. Food and Drug Administration ( FDA ) for the prevention and treatment of breast cancer. On September 7, 2012, we entered into a license agreement with Helsinn Healthcare SA ( Helsinn ) to distribute, promote, market and sell Gelclair , a unique oral gel whose key ingredients are polyvinlypyrrolidone (PVP) and sodium hyaluronate (hyaluronic acid), for the treatment of certain approved indications in the United States. Gelclair is an FDA-cleared product indicated for the treatment of oral mucositis. In addition, we have a marketing agreement with Innocutis Holdings, LLC pursuant to which we promote Bionect (hyaluronic acid sodium salt, 0.2%) within the U.S. oncology and radiation oncology marketplace. Bionect has been cleared by the FDA for the management of irritation of the skin as well as first and second degree burns. We have a clinical development asset, KRN5500, which is a Phase 2 product candidate targeted for treating cancer patients with painful treatment-refractory chronic chemotherapy induced peripheral neuropathy (CCIPN). KRN5500 has been designated a Fast Track Drug by the FDA. On February 24, 2014 the FDA granted Orphan Drug Designation to KRN5500 for the parenteral treatment of painful, chronic, chemotherapy-induced peripheral neuropathy that is refractory to conventional analgesics. Fast Track Designation is intended to facilitate the development and expedite review of drugs and biologics intended to treat serious or life-threatening conditions and that demonstrate the potential to address unmet medical needs. Orphan drug designation provides extended market exclusivity, tax benefits, and the waiver of certain fees associated with the FDA approval process. We are evaluating options to partner the drug with an established pharmaceutical development company to undertake and support further development costs, as well as determining whether further internal development of KRN5500 could be beneficial to our partnering efforts. As part of our strategic plan to focus on the commercialization of oncology treatment and oncology supportive care products, on June 17, 2013, we granted T3D Therapeutics, Inc. ( T3D ) the exclusive worldwide rights to develop and commercialize DB959, an oral, highly selective, dual PPAR (peroxisome proliferator activated receptor) nuclear receptor agonist, which we developed through Phase I clinical trials. For the license, we received a $250,000 up front payment, a second payment of $25,000 in December 2013, a third payment of $100,000 in January 2014 and a fourth payment of $125,000 in February 2014. We used the initial $250,000 to pay off $250,000 in existing liabilities to Bayer Healthcare LLC ( Bayer ). The Company is also entitled to receive certain milestone payments upon achievement of certain development milestones by T3D which could be in excess of the Company's milestone and annual payment obligations to Bayer. On October 25, 2013, we entered into an agreement with Alamo Pharma Services ( Alamo ) pursuant to which Alamo now provides us with a dedicated national sales team of 20 sales representatives to promote our commercial products. In addition, we signed an agreement, exclusive to the oncology market, with Mission Pharmacal ( Mission ), Alamo s parent company, to share in the costs and expenses of the sales force. The Alamo sales team, in addition to promoting our products Soltamox (tamoxifen citrate), Gelclair and Bionect, are promoting three Mission products: Ferralet 90 , Binosto (alendronate sodium) and Aquoral . The agreements with Alamo and Mission expand our presence in oncology supportive care and the products complement our portfolio in presenting comprehensive offerings to the oncologist. This sales force became operational with sales representatives trained and in their assigned territories in early January 2014. With the expansion of the sales force to 20 sales representatives, we expect our commercial costs, net of Mission support payments to Alamo, to be significantly higher on an annualized basis. In early May, 2014, we implemented a new "No Coupon, No Co-pay, No Hassles" retail patient cost-saving program in support of Gelclair and Soltamox. This new program is meant to reduce or eliminate financial outlays by patients by offsetting their out-of-pocket co-pay expenses with such reductions being applied automatically to qualified prescriptions at more than 43,000 pharmacies nationwide. No additional paperwork, coupons or electronic input are required by patients, health care providers, or pharmacists to realize the benefit of the "No Coupon, No Co-Pay, No Hassles" program. This program is now available in over 95% of local retail pharmacies nationwide, is accepted at the vast majority of national retail pharmacy chains and we believe will assist us in capturing more prescriptions written for Gelclair and Soltamox. We are employing a multi-disciplinary approach to reach and educate health care providers, dispensers, patient advocacy groups, foundations, caregivers and patients directly. We believe we can accomplish this through utilization of the contract sales organization of 20 sales representatives, innovative marketing programs, partnerships with specialty pharmacy providers, working with patient advocacy groups and foundations as well as collaborative arrangements with third party sales organizations. As we gain additional commercial experience with our products, we may modify these activities as appropriate. As we have generated minimal revenues from operations to date, we must have a sufficient level of liquidity in order to successfully achieve our commercial and operational goals. Our primary source of working capital has been the proceeds of registered direct offerings and private placements of equity securities and the prior sales of securities we acquired through investments made in other companies. We expect to continue to incur operating losses in the near-term. Our results may vary depending on many factors, including our ability to build a successful sales and marketing organization, our ability to properly anticipate customer needs and the progress of licensing activities of KRN5500 with pharmaceutical partners. We continue to pursue other in-licensing opportunities for approved products. Product Commercialization and the Mission Products Our primary focus is on the commercialization of the following oncology treatment and oncology supportive care pharmaceutical products: Soltamox, an FDA-approved oral solution of tamoxifen citrate; Cancer support therapeutics, including Gelclair, an FDA-cleared product indicated for the treatment of oral mucositis and Bionect, an FDA cleared product for the management of irritation of the skin as well as first and second degree burns; and Three Mission Pharmacal products: Ferralet 90 (for anemia), BINOSTO (alendronate sodium effervescent tablet indicated for the treatment of osteoporosis), and Aquoral (for cancer related dry mouth). Oral liquid formulations of FDA approved products Our oral liquid products can provide an attractive and effective alternative to solid dose formulations for those patients with dysphagia, or difficulty swallowing, or those who simply prefer to take drug products in liquid form. Those suffering from dysphagia often have difficultly or experience pain when using oral tablet or capsule products and can benefit greatly from liquid formulations of drugs. In addition, breast cancer patients receiving chemotherapeutic agents are subject to oral mucositis, which makes liquid medical formulations preferable. Soltamox Soltamox (tamoxifen citrate) oral solution, our first proprietary, FDA approved product, is a drug primarily used to treat breast cancer. Soltamox is the only liquid formulation of tamoxifen available for sale in the United States. As a result of our acquisition of Oncogenerix, we became party to an exclusive license and distribution agreement with Rosemont Pharmaceuticals, Ltd. ( Rosemont ), a U.K. based manufacturer and a subsidiary of Perrigo Company plc, for exclusive rights to market Soltamox in the United States. Previously, Soltamox was marketed only in the U.K. and Ireland by Rosemont Pharmaceuticals, Ltd. Soltamox is protected by a U.S. issued patent which expires in June 2018. Under our license agreement with Rosemont, we are obligated to meet minimum sales thresholds during the seven-year term of the agreement. We launched Soltamox in the U.S. in the fourth quarter of 2012. Soltamox is used primarily for the chronic treatment of breast cancer or for cancer prevention in certain susceptible breast cancer subgroups. The National Cancer Institute (NCI) estimated that in 2014, 232,670 women would be diagnosed with breast cancer and 40,000 women would die as a result of the disease. Tamoxifen therapy is generally indicated for breast cancer patients for up to 5 years. In order to commercialize Soltamox, we had initially established a specialty commercial sales force to market Soltamox to oncologists, targeting physicians who prescribe tamoxifen. This initial sales force has now been replaced by the Alamo sales force. Current physicians who prescribe tablet forms of tamoxifen in the United States are well known and easily identified by data sources such as IMS and Wolters Kluwer, providers of information services for the healthcare industry. We are employing a multi-disciplinary approach to reach and educate health care providers, dispensers, patient advocacy groups, foundations, caregivers and patients directly about our products. We believe we can accomplish this through utilization of a combination of our own specialized sales organization and independent sales representatives, tele-detailing, appropriate levels of product sampling, innovative marketing programs, partnerships with Specialty Pharmacy Providers, working with Patient Advocacy Groups and Foundations as well as collaborative arrangements with third party sales organizations. We have also recently completed a registry survey called CAPTURE to gather information on compliance, adherence and preference for a liquid therapy among current tamoxifen patients and will use the results in clinical publications as well as marketing programs and materials to support increased utilization of Soltamox. CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered (1) Proposed Maximum Aggregate Offering Price Amount of Registration Fee (2) Units consisting of: $ 12,500,000 $ 1,610 (i) Series C-1 convertible preferred stock, par value $0.01 per share (3) $ $ (ii) Warrants to purchase common stock (3) (4) $ $ Common Stock issuable upon conversion of the Series C-1 convertible preferred stock (3) $ $ Common Stock issuable upon exercise of the warrants included in the units (5) $ 15,625,000 $ 2,013 Total $ 28,125,000 $ 3,623 ( 6 ) (1) Pursuant to Rule 416 under the Securities Act of 1933, as amended (the Securities Act ), the securities registered also include such indeterminate number of shares of common stock as may be issuable to eliminate any dilutive effect of any future stock split, stock dividend or similar transactions. (2) Calculated pursuant to Rule 457(o) of the rules and regulations under the Securities Act based on an estimate of the proposed maximum aggregate offering price. (3) No separate registration fee is payable pursuant to Rule 457 under the Securities Act. (4) The warrants included in the units will consist of two separate classes of warrants, with each unit allocated an equal number of warrants of each such class, as described in this registration statement. (5) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(g) under the Securities Act. (6) The Registrant previously paid a registration fee of $1,610 upon the initial filing of this registration statement on December 23, 2013. An additional fee of $2,576 was paid in connection with the filing of Amendment No. 1 on April 18, 2014, for an aggregare fee paid of $4,186. No additional fee is payable with the filing of this Amendment No. 5. The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell securities, and it is not soliciting an offer to buy these securities, in any state where the offer or sale is not permitted. Preliminary Prospectus, Subject to Completion Dated May 22 , 2014 PROSPECTUS Up to 12,500 Shares of Series C-1 Preferred Stock (and 10,964,912 Shares of Common Stock Underlying the Series C-1 Preferred Stock , based upon an assumed Series C-1 conversion price of $1.14 ) Warrants to Purchase up to 10,964,912 Shares of Common Stock. based upon an assumed Series C-1 conversion price of $1.14 (and 10,964,912 Shares of Common Stock Issuable Upon Exercise of Warrants , based upon an assumed Series C-1 conversion price of $1.14 ) We are offering up to 12,500 units to purchasers in this offering, with each unit consisting of (1) one share of Series C-1 preferred stock which is convertible into approximately 877.2 shares of our common stock (based upon an assumed Series C-1 conversion price of $1.14, which was the last reported sale price of our common stock on May 20, 2014), (2) a five-year warrant callable in certain circumstances and exercisable for approximately 438.6 shares of our common stock (based upon an assumed Series C-1 conversion price of $1.14, which was the last reported sale price of our common stock on May 20, 2014) at an exercise price of $[ ] per share (105% of the closing bid price of our common stock preceding pricing of the offering) and (3) a thirteen-month warrant exercisable for approximately 438.6 shares of our common stock (based upon an assumed Series C-1conversion price of $1.14, which was the last reported sale price of our common stock on May 20, 2014) at an exercise price of $[ ] per share (105% of the closing bid price of our common stock preceding pricing of the offering). This prospectus also covers the shares of common stock issuable upon conversion of the Series C-1 preferred stock and upon exercise of the warrants. Each of the two warrants included in each unit will cover a number of shares of our common stock equal to 50% of the number of shares of common stock underlying the share of Series C-1 preferred stock included in such unit at closing. The units will be sold for a purchase price equal to $1,000 per unit. Units will not be issued or certificated. The shares of Series C-1 preferred stock and the warrants are immediately separable and will be issued separately, but will be purchased together in this offering. Subject to certain ownership limitations, the Series C-1 preferred stock is convertible at any time at the option of the holder into shares of our common stock at an initial conversion price of $[ ] per share. Subject to certain ownership limitations, the warrants are immediately exercisable. For a more detailed description of the Series C-1 preferred stock, see the section entitled Description of Securities We Are Offering Series C-1 Preferred Stock beginning on page 21 of this prospectus. For a more detailed description of the warrants, see the section entitled Description of Securities We Are Offering Warrants beginning on page 22 of this prospectus. For a more detailed description of our common stock, see the section entitled Description of Capital Stock Common Stock beginning on page 23 of this prospectus. Our common stock is quoted on the NASDAQ Capital Market under the symbol DARA. The last reported sale price of our common stock on May 21 , 2014 was $1.07 per share. We do not intend to apply to list the Series C-1 preferred stock or the warrants on any securities exchange. We have retained Ladenburg Thalmann & Co. Inc. (the Placement Agent ) to act as placement agent in connection with this offering and to use its best efforts to solicit offers to purchase the units. The Placement Agent is not purchasing or selling any units pursuant to this offering, nor are we requiring any minimum purchase or sale of any specific number of units. Because there is no minimum offering amount required as a condition to the closing of this offering, the actual public offering amount, placement agent fees and proceeds to us are not presently determinable and may be substantially less than the maximum amounts set forth below. See Plan of Distribution beginning on page 27 of this prospectus for more information regarding these arrangements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 8 of this prospectus for more information. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ $ Placement Agent fees(1) $ $ Proceeds, before expenses, to us $ $ _______________ (1) In addition, we have agreed to reimburse the expenses of the Placement Agent as described in the Plan of Distribution herein. We expect that delivery of the securities being offered pursuant to this prospectus will be made to purchasers on or about [ ], 2014. Ladenburg Thalmann & Co. Inc H.C. Wainwright & Co., LLC The date of this prospectus is [ ], 2014. Cancer support therapeutics We are also focused on the commercialization of cancer support therapeutics. Gelclair On September 7, 2012, we entered into a distribution and license agreement with Helsinn Healthcare SA. The Company was granted an exclusive license to distribute, promote, market and sell Gelclair for treatment of certain approved indications in the United States. Gelclair, a unique oral gel whose key ingredients are polyvinlypyrrolidone (PVP) and sodium hyaluronate (hyaluronic acid), is an FDA-cleared product indicated for the treatment of oral mucositis. Gelclair is protected by a U.S. issued patent which expires in 2021. Under the license agreement with Helsinn, the Company is obligated to meet minimum sales thresholds during the ten-year term of the agreement. The license agreement also provides that the Company will receive exclusive rights to distribute, promote, market and sell Gelclair for an additional indication if Helsinn is able to obtain regulatory approval for such indication. We launched Gelclair in the United States in April 2013. Bionect On March 23, 2012, we entered into an Exclusive Marketing Agreement with Innocutis Holdings, LLC pursuant to which we promote Bionect (hyaluronic acid sodium salt, 0.2%) within the U.S. oncology and radiation oncology marketplace. Bionect has been approved by the FDA for the management of irritation of the skin as well as first and second degree burns. Previously, Bionect was promoted and sold by Innocutis only in the dermatology market. Innocutis continues to promote Bionect in the dermatology market. Bionect is protected by a U.S. issued patent that expires in 2016. We will be compensated by Innocutis for each unit sold in the U.S. oncology and radiation oncology market. We began promoting Bionect in the U.S. oncology and radiation oncology market in the second quarter of 2012. The term of the agreement will continue until April 1, 2015 and will be automatically renewed in yearly increments unless notice is given by either party 30 days prior to the expiration of the term or extended term. Mission Pharmacal Products On October 25, 2013, we entered into an agreement with Alamo Pharma Services, a subsidiary of Mission Pharmacal, for a twenty (20) person national sales team in the U.S. oncology market. Pursuant to the agreement and a shared sales force agreement with Mission, the Alamo sales team in addition to promoting our Soltamox (tamoxifen citrate), Gelclair and Bionect products, also carries three Mission Pharmacal products: Ferralet 90 (for anemia), BINOSTO (alendronate sodium effervescent tablet indicated for the treatment of osteoporosis), and Aquoral (for cancer related dry mouth). These products are also currently being promoted by Mission Pharmacal in other therapeutic markets and all are under patent protection throughout the term of our agreement. The agreements with Alamo and Mission expand our presence in oncology supportive care to address ongoing areas of unmet medical need. Clinical Stage Asset KRN5500 KRN5500 is a novel, non-narcotic/non-opioid intravenous product for the treatment of painful chronic chemotherapy induced peripheral neuropathy in patients with cancer. The drug has successfully completed a Phase 2a proof of concept study in patients with end-stage cancer and analgesia-resistant neuropathic pain where it showed statistically-significant pain reduction versus placebo (p = 0.03) using standardized pain test scores. There were no serious safety concerns, although nausea and vomiting were a common occurrence. The FDA has designated KRN5500 a Fast Track drug, based on its potential usefulness in treating a serious medical condition and in fulfilling an unmet medical need. On February 24, 2014 the FDA granted Orphan Drug Designation to KRN5500 for the parenteral treatment of painful, chronic, chemotherapy-induced peripheral neuropathy that is refractory to conventional analgesics. We have improved and simplified the formulation and manufactured new drug substance for the next clinical trial. Since KRN5500 would complement our portfolio of oncology treatment and supportive care pharmaceuticals, we are looking at options to partner the drug with an established oncology development company to undertake and support the cost for the Phase 2b program, and are evaluating whether any further internal development of KRN5500 would be beneficial to our partnering efforts. Corporate Information DARA BioSciences, Inc. is a Delaware corporation incorporated on December 30, 1993. Our executive offices are located at 8601 Six Forks Road, Suite 160, Raleigh, North Carolina 27615, and our telephone number is (919) 872-5578. Our Internet address is www.darabio.com. The information on our website is not incorporated by reference into this prospectus and you should not consider it part of this prospectus.
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+The following summary highlights material information contained elsewhere in or incorporated by reference into this prospectus. It may not contain all the information that is important to you. For additional information, you should read this entire prospectus carefully, including Risk Factors, and all other information included in or incorporated by reference into this prospectus The Company Royal is a Pennsylvania business corporation and a bank holding company registered under the Bank Holding Company Act of 1956, as amended (the Bank Holding Company Act ). Royal s headquarters are located at 732 Montgomery Avenue, Narberth, Pennsylvania, 19072. The following table includes some summary financial information about Royal as of and for the quarters ended March 31, 2014 and 2013, and as of and for each of the three years ended December 31, 2013, 2012 and 2011, respectively. See Selected Historical Financial Information for additional information. (in thousands, except per share data) As of and for the quarters ended March 31, As of and for the year ended December 31, 2014 2013 2013 2012 2011 Net income (loss) attributable to Royal Bancshares $ 1,498 $ 118 $ 2,109 $ (15,625 ) $ (8,563 ) Net income (loss) to common shareholders 834 (397 ) 34 $ (17,663 ) $ (10,566 ) Income (loss) per share 0.06 (0.03 ) - $ (1.33 ) $ (0.80 ) Total assets 734,410 746,531 732,254 $ 769,455 $ 844,187 Total deposits 532,632 531,370 528,964 $ 554,917 $ 575,916 Royal Bancshares shareholders equity 51,270 50,132 47,534 $ 49,758 $ 66,283 The principal activities of the Company are supervising the Bank, which engages in general banking business principally in Montgomery, Delaware, Chester, Bucks, Philadelphia and Berks counties in Pennsylvania, southern New Jersey, and Delaware. The Company also has a wholly owned non-bank subsidiary, Royal Investments of Delaware, Inc., which is engaged in investment activities. As a bank holding company registered under the Bank Holding Company Act, we are subject to the supervision of the Board of Governors of the Federal Reserve System (the Federal Reserve ). In addition, the Bank is subject to regulation, supervision and regular examination by the Pennsylvania Department of Banking and Securities (the Banking Department ) and the Federal Deposit Insurance Corporation ( FDIC ), and the Bank s deposits are insured by the FDIC. As a result of deteriorating credit quality, declining earnings, and decreasing capital at Royal Bank, on July 15, 2009, the Bank entered into a Stipulation and Consent to the Issuance of an Order to Cease and Desist with each of the FDIC and the Banking Department. The material terms of the orders required Royal Bank to: (i) have and retain qualified management, and notify the FDIC and the Department of any changes in Royal Bank s Board of Directors or senior management; (ii) increase participation of Royal Bank s Board of Directors in Royal Bank s affairs by having the board assume full responsibility for approving Royal Bank s policies and objectives and for supervising Royal Bank s management; (iii) eliminate all assets classified as loss and formulate a written plan to reduce assets classified as doubtful and substandard at its regulatory examination; (iv) develop a written plan to reduce delinquent loans, and restrict additional advances to borrowers with existing credits classified as loss, doubtful or substandard ; (v) develop a written plan to reduce Royal Bank s commercial real estate loan concentration; (vi) maintain, after establishing an adequate allowance for loan and lease losses, a ratio of Tier 1 capital to total assets ( leverage ratio ) equal to or greater than 8% and a ratio of qualifying total capital to risk-weighted assets (total risk-based capital ratio) equal to or greater than 12%; (vii) formulate and implement written profit plans and comprehensive budgets for each year during which the orders were in effect; (viii) formulate and implement a strategic plan covering at least three years, to be reviewed quarterly and revised annually; (ix) revise the liquidity and funds management policy and update and review the policy annually; (x) refrain from increasing the amount of brokered deposits held by Royal Bank and develop a plan to reduce the reliance on non-core deposits and wholesale funding sources; (xi) refrain from paying cash dividends without prior approval of the FDIC and the Department; (xii) refrain from making payments to or entering into contracts with the Company or other Royal Bank affiliates without prior approval of the FDIC and the Department; (xiii) submit to the FDIC for review and approval an executive compensation plan that incorporates qualitative as well as profitability performance standards for Royal Bank s executive officers; (xiv) establish a compliance committee of the Board of Directors of Royal Bank with the responsibility to ensure Royal Bank s compliance with the orders; and (xv) prepare and submit quarterly reports to the FDIC and the Department detailing the actions taken to secure compliance with the orders. The FDIC and the Department did not impose or recommend any monetary penalties in connection with the orders. The orders were subsequently replaced with an informal agreement, known as a memorandum of understanding, in the fourth quarter of 2011, which requires, among other things, that the Bank maintain a leverage ratio equal to or greater than 8% and a total risk-based capital ratio equal to or greater than 12%. In addition, on March 17, 2010, the Company entered into a written agreement with the Federal Reserve Bank of Philadelphia (the Federal Reserve Bank ). The material terms of the agreement provided that: (i) the Company s board of directors would take appropriate steps to fully utilize the Company s financial and managerial resources to serve as a source of strength to its subsidiary banks, including taking steps to ensure that Royal Bank complied with the orders previously entered into with the FDIC and the Department on July 15, 2009; (ii) the Company s board of directors would submit to the Federal Reserve Bank a written plan to strengthen board oversight of the management and operations of the consolidated operation; (iii) the Company would not declare or pay any dividends without the prior written approval of the Federal Reserve Bank and the Director of the Division of Banking Supervision and Regulation of the Board of Governors of the Federal Reserve System (the Director ); (iv) the Company and its nonbank subsidiaries would not make any distributions of interest, principal, or other sums on subordinated debentures or trust preferred securities without the prior approval of the Federal Reserve Bank and the Director; (v) the Company and its nonbank subsidiaries would not incur, increase, or guarantee any debt without the prior written approval of the Federal Reserve Bank; (vi) the Company would not purchase or redeem any shares of its stock without the prior written approval of the Federal Reserve Bank; (vii) the Company would submit to the Federal Reserve Bank an acceptable written capital plan to maintain sufficient capital at the Company on a consolidated basis, which plan will at a minimum address: regulatory requirements for the Company and the Bank, the adequacy of the Bank s capital taking into account the volume of classified credits, the allowance for loan and lease losses, current and projected asset growth, and projected retained earnings; the source and timing of additional funds necessary to fulfill the consolidated organization s and the Bank s future capital requirements; supervisory requests for additional capital at the Bank or the requirements of any supervisory action imposed on the Bank by federal or state regulators; and applicable legal requirements that the Company serve as a source of strength to the Bank; (viii) the Company would submit to the Federal Reserve Bank cash flow projections for 2010 and each subsequent calendar year prior to the beginning of such year; (ix) the Company would comply with applicable legal notice provisions in advance of appointing any new director or senior executive officer or changing the responsibilities of any senior executive officer, and comply with restrictions on indemnification and severance payments imposed by the Federal Deposit Insurance Act; and (x) the Company s board of directors would submit progress reports to the Federal Reserve Bank detailing the form and manner of all actions taken to secure compliance with the agreement and the results thereof, together with a parent company-level balance sheet, income statement, and, as applicable, report of changes in shareholders equity. The written agreement with the Federal Reserve Bank was replaced with a memorandum of understanding in July 2013. See Risk Factors Our business may be impacted by the existence of the informal agreements with the FDIC, the Pennsylvania Department of Banking and the Federal Reserve Bank of Philadelphia. Our principal executive offices are located at 732 Montgomery Avenue, Narberth, Pennsylvania 19072. Our telephone number is (610) 668-4700. Our website is www.royalbankamerica.com. Information on our website is not incorporated by reference into this prospectus and is not a part of this prospectus. Royal Bank America The Bank is a Pennsylvania state-chartered bank that commenced operations on October 22, 1963. Royal Bank is the successor of the Bank of King of Prussia, the principal ownership of which was acquired by the Tabas family in 1980. The deposits of the Bank are insured by the FDIC. As of December 31, 2013, the Bank also holds a 80% equity interest in Crusader Servicing Corporation ( CSC ) and owns 100% of Royal Tax Lien Services, LLC ( RTL ) and 60% of Royal Bank America Leasing, LP ( Royal Leasing ). CSC and RTL acquired, through public auction, delinquent tax liens in various jurisdictions thereby assuming a superior lien position to most other lien holders, including mortgage lien holders. Royal Leasing originates small ticket leases through its internal sales staff and through independent brokers located throughout its business area. The Bank derives its income principally from interest charged on loans, interest earned on investment securities, and fees received in connection with the origination of loans and other services. The Bank s principal expenses are interest expense on deposits and borrowings and operating expenses. Operating revenues, deposit growth, investment maturities, loan sales and the repayment of outstanding loans provide the majority of funds for activities. The Bank conducts business operations as a commercial bank offering checking accounts, savings and time deposits, and loans, including residential mortgages, home equity and SBA loans. The Bank also offers safe deposit boxes, collections, internet banking and bill payment along with other customary bank services (excluding trust) to its customers. Drive-up, ATM, and night depository facilities are available. The Bank s primary service area includes Pennsylvania, primarily Montgomery, Chester, Bucks, Delaware, Berks and Philadelphia counties, and Camden County, New Jersey. This area includes residential areas and industrial and commercial businesses of the type usually found within a major metropolitan area. The Bank serves this area from fifteen branches located throughout Montgomery, Philadelphia, Delaware and Berks counties and Camden County, New Jersey. The Bank also considers New York, Maryland, and Delaware as a part of its service area for certain products and services. In the past, the Bank had frequently conducted business with clients located outside of its service area. The Bank has loans in nineteen states via loan originations and/or participations with other lenders who have broad experience in those respective markets. The Bank s headquarters are located at 732 Montgomery Avenue, Narberth, Pennsylvania 19072. Table of Contents Purpose of Offering On February 20, 2009, as part of the Capital Purchase Program (the CPP ) established by the United States Department of Treasury (the U.S. Treasury ), we issued 30,407 shares of our Fixed Rate Cumulative Perpetual Preferred Stock, Series A, without par value per share and a liquidation preference of $1,000 per share (the TARP Shares ), to the U.S. Treasury. In conjunction with the issuance of the TARP Shares, we issued to the U.S. Treasury a warrant to purchase 1,104,370 shares of our Class A common stock at an exercise price of $4.13 per share. Cash dividends accrued on the TARP Shares at the rate of 5% per annum until February 20, 2014, and accrue at the rate of 9% per annum thereafter. Such dividends are cumulative if not paid, and as of May 15, 2014, we had missed 20 quarterly dividend payments, resulting in approximately $9.0 million of unpaid dividends and interest on unpaid dividends on the TARP Shares that have not been recognized in our consolidated financial statements. We were notified by the U.S. Treasury that the U.S. Treasury will conduct an auction of the TARP Shares (the Auction ) during June 9, 2014 through June 12, 2014, and that we can participate with other interested purchasers by placing bids for TARP Shares in the Auction. The Auction is structured as a modified Dutch Auction, in which the interested purchasers submit bids containing the price per share at which they are willing to purchase shares and the number of shares they are willing to purchase at that price. The highest price at which all of the shares offered would be sold to purchasers submitting bids becomes the price at which all of the shares are sold in the Auction. We will use the net proceeds of the offering to increase our capital and liquidity. We will accept subscriptions and issue shares in the offering only if any of our bids to purchase TARP Shares in the Auction is successful. We have received approval from the Federal Reserve to use up to $13,988,000 to purchase TARP shares in the Auction. No assurance can be given that we will be successful in our bid to purchase TARP Shares in the Auction or, if successful, how many TARP Shares will be purchased by us in the Auction. If we are not successful in purchasing TARP Shares in the Auction, we will terminate the subscription rights offering and will not close the private placement. The estimated net proceeds from the rights offering is $5,925,000, assuming all of the 5,000,000 shares are subscribed for and purchased in the offering. The estimated net proceeds from the private placement is $13,988,000. We intend to use the net proceeds from the private placement to bid on the TARP Shares in the Auction. Private Placement We expect to complete a private placement of our Class A common stock prior to the closing of the rights offering. In the private placement we have entered into stock purchase agreements with certain investors. Pursuant to the stock purchase agreements, subject to the terms and conditions contained therein: Emerald (who we sometimes refer to as the selling shareholder ) is obligated to purchase from us, at $1.20 per share, 2,400,000 shares of Class A common stock; Another institutional investor (who we sometimes refer to as the "Institutional Investor.") is obligated to purchase from us, at $1.20 per share, 2,400,000 shares of Class A Common Stock ; Certain of the Company s directors and officers (excluding the Tabas family) are obligated to purchase from us, at $1.20 per share, 498,333 shares of our Class A common stock; and The Daniel M. Tabas Trust is obligated to purchase from us, at $1.20 per share, 2,500,000 shares of our Class A common stock. If the rights offering closes after the closing on the private placement, Emerald and the other institutional investor each have the option to purchase additional shares of our Class A common stock provided that after such purchases neither Emerald nor the other institutional investor may own more than 9.9% of the outstanding shares of Class A common stock and provided further that the total number of shares sold in the private placement does not exceed 11,666,667. See The Private Placement herein. The investors obligations to purchase the shares subscribed for in the private placement are subject to certain closing conditions, including that we are successful in purchasing TARP Shares in the Auction and that we obtain all governmental approvals necessary for us to purchase TARP Shares in the Auction. For more information, see The Private Placement. If the Company is not a winning bidder in the Auction, the Company will file a post-effective amendment to the registration statement of which this prospectus is a part and remove the selling shareholder shares from the registration statement. Table of Contents
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+PROSPECTUS SUMMARY This summary provides a brief overview of information contained elsewhere in this prospectus. Because it is abbreviated, this summary does not contain all of the information that you should consider before investing in our common stock. You should read the entire prospectus carefully before making an investment decision, including the information presented under the headings "Risk Factors," "Special Note Regarding Forward-Looking Statements" and "Management s Discussion and Analysis of Financial Condition and Results of Operations" and the financial statements and related notes beginning on page F-1. All dollar amounts are in U.S. dollars unless otherwise indicated. In this prospectus, unless the context otherwise requires, the terms TransCoastal, Company, "we," "us" and "our" refer to TransCoastal Corporation and its subsidiaries. Overview TransCoastal Corporation ("Company" or "TransCoastal") was incorporated in the State of Delaware in June 1999 in the original name of Claimsnet.com, Inc. ("Claimsnet") and has a fiscal year end of December 31. We are an oil and gas exploration and production company focused primarily in the development of oil and gas reserves in the state of Texas. Our revenue comes from the sale of the hydrocarbons we produce and to a small extent from the trading of oil and gas properties. The Company has acquired or divested over 100 wells in Texas, and has over 200 undeveloped locations on over 6000 acres of leased oil and gas property located primarily in the panhandle area of west Texas. In addition to maintaining daily operations on our producing wells we also drill new wells, rehabilitate old wells and actively engage in locating additional oil and gas leases. A complete list of the oil and gas properties the Company currently owns or in which it has an interest is contained in the "Properties" section below.
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+PROSPECTUS SUMMARY This summary highlights information contained in greater detail elsewhere in or incorporated by reference into this prospectus. This summary is not complete and does not contain all of the information you should consider in making your investment decision. You should read the entire prospectus and the documents incorporated by reference into this prospectus carefully before making an investment in our common stock. You should carefully consider, among other things, the section entitled Risk Factors included elsewhere in this prospectus as well as the information contained in the documents to which we have referred to under Where You Can Find Additional Information. IKANOS COMMUNICATIONS, INC. Overview We provide semiconductor products and software for delivering high speed broadband and networking solutions to the connected home. Our broadband digital subscriber line, or DSL, processors and other semiconductor offerings power carrier infrastructure for the central office, or CO, which we also refer to as Access, and customer premises equipment, or CPE, which we also refer to as Gateway, for network equipment manufacturers, or NEMs, serving leading telecommunications service providers, or telcos. Our products are at the core of DSL access multiplexers, or DSLAMs, optical network terminals, or ONTs, concentrators, modems, voice over Internet Protocol, or VoIP, terminal adapters, integrated access devices, or IADs, and residential gateways, or RGs. Our products have been deployed by service providers in Asia, Europe, and North and South America and are also actively being evaluated and scheduled to be evaluated by other service providers for deployment in their networks. Our products reflect advanced designs in silicon, systems, and firmware and are programmable and highly-scalable. Our expertise in integration of our digital signal processor, or DSP, algorithms with advanced digital, analog, and mixed signal semiconductors enables us to offer high-performance, high-density, and low-power asymmetric DSL, or ADSL, and very-high bit rate DSL, or VDSL, products that offer vectoring and bonding to increase speeds of existing telecom carrier copper and hybrid-fiber copper infrastructure. We believe these products support high speed broadband service providers multi-play deployment plans to the connected home while keeping their capital and operating expenditures relatively low compared to competing frameworks. Our broadband DSL products consist of high performance Access and Gateway chips. We have demonstrated through our internal testing an aggregate downstream and upstream rate of 300 megabits per second, or Mbps, over a single pair copper line at a distance of up to 200 meters, and 150Mbps aggregate data rate up to a distance of 500 meters. These performance numbers are among the highest rate and reach capabilities currently available in the market using VDSL technology. Our next generation G.fast products for the ultra-broadband market, which are currently in development, will be designed to achieve speeds up to 1Gbps. Our xDSL revenue mix over the last four years has transitioned away from ADSL in favor of VDSL, in-line with global market trends. In 2010, as a percentage of our total A/VDSL revenue, VDSL accounted for approximately 54%, whereas in the first nine months of 2014, this percentage increased to approximately 91%. In its September 2013 report entitled Vectoring and Bonding Renews DSL, the Linley Group estimated that the market for VDSL silicon solutions, or integrated circuits, or ICs, will continue to increase over the next four years as a result of the transition that is taking place in the carrier market from ADSL to VDSL. This transition is expected to result in a significant replacement opportunity for silicon vendors and equipment manufacturers. In addition, the while total port count is not expected to increase significantly over this period, estimated revenue is expected to increase primarily due to the increasing cost per port associated with the transition from ADSL to VDSL, deployment of vectoring, and the emergence of G.fast, which offers high bitrates up to gigabits per second. While G fast technology will serve the portion of the market corresponding to Table of Contents short-loop configuration (<100m), we believe the rest of the market will be addressed through a combination of ADSL and VDSL. Additionally, we believe cross-talk cancellation enabled through vectoring will be equally important for G.fast enabled lines, and as such, we believe the emergence of gigabit broadband and adoption of G.fast will increase the need for carrier deployment of vectoring technology. We also offer a line of communications processors, or CPs, for residential gateways that support a variety of WAN topologies for telecom carriers and cable multiple system operators, or MSOs, including Ethernet and gigabit Ethernet, passive optical network, or PON, hybrid-fiber-copper network, and wireless broadband. While majority of our silicon solutions are deployed in xDSL networks at global telcos, our CPs are also currently deployed in both cable and fiber-to-the-home, or FTTH, networks. Our CPs are an important part of our diversification strategy to expand our target market beyond xDSL. In addition to our xDSL and CPs, in 2013 we announced inSIGHT, our suite of CPE-based monitoring and analytics software products. inSIGHT offers carriers the ability to remotely monitor and diagnose line impairments and noise issues to facilitate fast and cost-effective discovery and resolution of service disruptions. While monitoring and diagnostics solutions are not new, we have taken a different approach to the problem by deploying this capability inside the home on the gateway itself versus the traditional network-based solutions. We believe our approach will provide several advantages to telcos, including higher accuracy of impairment detection and faster resolution, which in turn could translate to lower operating expenses for the telcos. inSIGHT has not yet been deployed in the market. In our 2013 Annual Report on Form 10-K, we provided estimates of the time to production for certain products. The production of our new VX58x family which taped-out during the second quarter of 2014 is now scheduled for 2015 to allow for additional features and testing. The production of our new Vx57x family has been rescheduled to 2015. Our Velocity-3 solution continues in carrier trials and is expected to reach production in 2015. We no longer expect Velocity-Uni to reach production as a result of a change in customer requirements. Our new inSIGHT monitoring and diagnostic software is in field trials, and is expected to be in production in 2015. Our semiconductor customers consist primarily of NEMs, original design manufacturers, or ODMs, contract manufacturers, or CMs, and original equipment manufacturers, or OEMs, and include vendors such as Sagemcom, Askey Computer Corporation, AVM Corporation, and Hon Hai Precision Industry Co., or Foxconn. Our products are deployed in the networks of telcos such as AT&T, Inc., Bell Canada, Orange S.A. (formerly France Telecom), KDDI Corporation, and Nippon Telegraph and Telephone, or NTT. We believe our products were deployed, by geography, as follows: the Americas, Europe, Asia, and Japan were 27%, 38%, 16%, and 19% in 2012, respectively, 15%, 56%, 11%, and 18% in 2013, respectively, and 17%, 58%, 5%, and 20% in the first nine months of 2014, respectively. We are a fabless semiconductor company with design, development, and sales personnel in the Silicon Valley and Redbank, New Jersey, as well as a research and development facility in India. Our headquarters is in Fremont, California and we had 236 employees globally as of September 29, 2014. Strategic Relationship with Alcatel-Lucent On September 29, 2014, in connection with the financing described in greater detail below, we announced a collaboration with Alcatel-Lucent on ultra-broadband products. We anticipate the collaboration will have a material positive impact on our future operations. In furtherance of the collaboration, we executed a term sheet which outlines certain requirements, deliverables, milestones, payments and other funding under the collaboration as well as certain pricing terms pursuant to which Alcatel-Lucent would purchase products from us. While the term sheet is, for the most part, binding, the terms of the collaboration will be further detailed in one or more definitive agreements, and entry into such definitive agreements is one of several conditions necessary in order for us to receive almost all of the payments and other funding and to draw on the ALU Loan. Table of Contents Our expectation is that by leveraging the innovation and technical expertise of both companies, we will be able to offer differentiated ultra-broadband products to our entire customer base targeting the growing gigabit broadband market in a range of port configurations and deployment scenarios. As telcos plan their transition to VDSL, vectoring, and G.fast for faster broadband service to their subscribers, we believe the timing for these products is aligned with the needs of the market. Alcatel-Lucent is one of the top five vendors in the infrastructure xDSL access equipment market according to The Dell Oro Group. In the last 12 months, as the transition to VDSL has accelerated, Alcatel-Lucent has increased its market share in this segment. According to a second quarter 2014 report by The Dell Oro Group, Alcatel-Lucent held the top position in VDSL shipments, with 44% market share. On a cumulative basis since inception, Alcatel-Lucent has shipped close to 50 million VDSL2 ports, of which 7.6 million are VDSL2 vectoring ports. Alcatel-Lucent and Ikanos have a history of collaboration dating back to the mid-2000 s, where the Alcatel-Lucent 7330 ISAM product used an Ikanos (Conexant) chipset for deployments in a wide range of global carriers, including AT&T and Bell Canada. Many of those devices are still in use today. We believe that our new collaboration with Alcatel-Lucent will be an opportunity for us to renew our relationship as a key supplier to Alcatel-Lucent, and will validate our position in the xDSL Access market. We believe the collaboration will also enable us to increase our share in the Access market. Should Alcatel-Lucent decide to deploy products resulting from our collaboration, we believe our gateway products will also benefit as a result of carrier interest in minimizing interoperability risk when deploying new gear in consumer homes. In addition, end-to-end products from a single silicon vendor also provide an additional opportunity for customized features which allow carriers to differentiate the services they offer their customers. Recent Financing Transaction On September 29, 2014, we entered into a securities purchase agreement with the Tallwood Group and Alcatel-Lucent, pursuant to which we sold in the Private Placement $11.25 million and $5.0 million of our common stock to the Tallwood Group and Alcatel-Lucent, respectively, at $0.41 per share for aggregate gross proceeds of approximately $16.25 million. The price represented a 17% premium to the market price per share of our common stock on September 26, 2014, the trading day immediately prior to the date of the Private Placement. The Tallwood Group has also agreed to purchase an additional $11.25 million of our common stock in the Rights Offering or the Standby Purchase, as described above. In addition to Alcatel-Lucent s $5.0 million equity investment, on September 29, 2014, we also entered into the ALU Loan Agreement with Alcatel-Lucent, pursuant to which we may borrow up to $10.0 million subject to the terms and conditions set forth in the ALU Loan Agreement. In connection with the ALU Loan Agreement, we issued Alcatel-Lucent the Warrant to purchase up to 3,157,894 Warrant Shares of our common stock with an exercise price of $0.475 per share, 1,578,947 of which are exercisable at any time until November 30, 2017 and, subject to certain adjustments, 1,578,947 of which are exercisable at any time on or after the funding date of the loan, but in no event after November 30, 2017. The funding of the ALU Loan is conditioned upon us entering into a definitive collaboration agreement with Alcatel-Lucent. We have agreed to register for resale the shares of common stock acquired by Alcatel-Lucent in the Private Placement and the Warrant Shares. In addition, we have agreed to register for resale of shares of common stock acquired by the Tallwood Group in the Private Placement, the 31.6 million shares owned by the Tallwood Group prior to the Private Placement, and any shares purchased in the Rights Offering or the Standby Purchase. Both Alcatel-Lucent and the Tallwood Group also have piggyback registration rights. Table of Contents Reasons for the Rights Offering We are conducting the Rights Offering to raise additional capital to finance our business, and to give Recordholders the opportunity to purchase their pro rata share of our common stock at the same price as in the Private Placement so that, subject to the Over-Subscription Privilege, those Recordholders, if they exercise their Basic Subscription Rights in full, would maintain their pre-Private Placement ownership interest relative to the Tallwood Group. See Background of the Collaboration and Funding Plan. Strategic Alternatives From time-to-time in the past, we have engaged in discussions that could have resulted in the potential acquisition of our company. None of these discussions has led to a definitive agreement. Although we have recently engaged in such discussions with a party, no offer has been received from such party. We have terminated the discussions and we do not intend to engage in discussions with that party as we implement the Rights Offering and Standby Purchase contemplated by this prospectus. In addition, in connection with the Private Placement, we have agreed that we will not consummate an acquisition within six months following the Private Placement (with respect to Alcatel-Lucent) or the Rights Offering (with respect to the Tallwood Group) if such closing would result in short swing liability under Section 16(b) of the Exchange Act to Alcatel-Lucent or the Tallwood Group, as applicable. See Background of the Collaboration and Funding Plan. Corporate Information We were incorporated in 1999 in California as Velocity Communications and changed our name to Ikanos Communications in December 2000. When we reincorporated in Delaware in September 2005, we changed our name to Ikanos Communications, Inc. Our principal executive office is located at 47669 Fremont Boulevard, Fremont, California 94538. Our telephone number at that location is (510) 979-0400. Our website address is www.ikanos.com. This is a textual reference only. We do not incorporate the information on our website into this prospectus, and you should not consider any information on, or that can be accessed through, our website as part of this prospectus. Background of the Collaboration and Funding Plan On September 29, 2014, we announced a collaboration with Alcatel-Lucent, the market leader in VDSL broadband access port shipments and vectoring deployments, for the development of ultra-broadband products. The collaboration is intended to address the growing ultra-broadband market, which includes various types of xDSL, vectoring and G.fast. We anticipate that the collaboration will have a significant positive impact on our future operations. In connection with the collaboration, we also announced a financing plan that includes the sale of common stock in a Private Placement to Alcatel-Lucent and the Tallwood Group, our largest investor group, as well as a Rights Offering that will allow our existing stockholders at the time of the Private Placement to invest, on a pro rata basis to the Tallwood Group, at the same price per share. Alcatel-Lucent and the Tallwood Group have, collectively, committed to provide to our company, subject to certain conditions, a total of $45 million in equity, loans and payments and other funding associated with the proposed collaboration. From time to time prior to the date of the Private Placement, our board of directors and members of our management team have considered various strategic opportunities intended to further the development of our business, including informally engaging in preliminary discussions and exchanging information under confidentiality agreements with other entities regarding various strategic alternatives such as business transactions and business combinations. These activities included consideration, beginning in July 2014, of a Table of Contents business combination with Company A discussed below. Management and our board of directors have also considered various financing methods and alternatives in order to raise additional capital necessary to run our business. At a meeting of our board of directors on January 28, 2014, management presented its 2014 Annual Operating Plan. Based on the operating plan, our board of directors concluded that we needed to explore various funding options because, under certain operating scenarios, we might need to raise additional funds no later than the fourth quarter of 2014 in order to continue our operations. Our board of directors authorized management to evaluate various funding options and report back to our board at a subsequent meeting. During 2013, we had a series of discussions with Alcatel-Lucent regarding our products and technology. In early February 2014, we had a further discussion with Alcatel-Lucent with respect to collaboration on ultra-broadband products. At that time, both parties indicated an interest in pursuing preliminary technical discussions regarding the integration of our technology into Alcatel- Lucent s ultra-broadband product development opportunities. In furtherance of those discussions, we entered into a bi-lateral confidentiality agreement and each party provided confidential information to the other party. The parties then commenced discussions concerning a collaboration, including the framework for a collaboration agreement between the two companies, which we refer to as the Proposed Collaboration. The first document resulting from the discussions was ultimately a term sheet defining certain key commercial terms, as described below. The term sheet is intended to be superseded by a comprehensive general purchase agreement, as well as a collaboration agreement detailing the terms of development, associated timelines, and key deliverables. In April 2014, Alcatel-Lucent stated that it would be willing to provide some form of funding to support the Proposed Collaboration, based in part on Alcatel-Lucent s analysis of our financial condition as detailed in our publicly-available filings with the SEC. Subsequently, on April 22, 2014, Alcatel-Lucent informed us that the Proposed Collaboration and Alcatel-Lucent s associated financing would be conditioned on the Tallwood Group providing equity funding in an amount at least equal to the total amount of funding to be provided by Alcatel-Lucent. In April 2014, management discussed with the Tallwood Group Alcatel-Lucent s condition to the Proposed Collaboration. The Tallwood Group indicated a willingness to consider supporting the Proposed Collaboration by making an additional investment in our company. At a meeting of our board of directors held on April 22, 2014, at which representatives of Pillsbury Winthrop Shaw Pittman LLP, or Pillsbury, outside counsel to our company, were present, management presented and our board of directors reviewed various potential strategic alternatives, including the Proposed Collaboration. Our board also determined that we needed to raise additional capital no later than early in the fourth quarter of 2014 in order to continue operations. Following the discussion, our board directed management to continue to evaluate several strategies for raising capital, including private offering, marketed public offering and debt financing alternatives, against the background of the associated time frames for implementing each type of financing. In light of (i) Alcatel-Lucent s requirement that the Tallwood Group make an additional equity investment to support the Proposed Collaboration, (ii) the Tallwood Group s willingness to consider such an investment, (iii) the Tallwood Group s significant ownership interest in us, and (iv) the Tallwood Group s three representatives on our board, our board determined that it was in the best interests of our company and our stockholders to form a special committee of independent and disinterested directors to negotiate the terms of any transaction in which the Tallwood Group would be a participant. Accordingly, our board of directors established a special committee consisting of three independent and disinterested directors who are not affiliated with the Tallwood Group: Danial Faizullabhoy, Jason Cohenour and Frederick Lax. Our board of directors authorized the Table of Contents special committee to, among other things, (i) negotiate the structure, price, terms and conditions of any public and/or private offering and to take any and all other actions as the special committee deemed necessary or appropriate in order to implement the issuance and sale of the common stock, (ii) approve, in its sole discretion, any proposed transaction in which Alcatel-Lucent and/or the Tallwood Group would participate, together with any other strategic or commercial transaction involving Alcatel-Lucent and/or the Tallwood Group and our company, and (iii) retain legal and financial advisors to the special committee. The special committee was not authorized to review, and did not review, the potential business combination with Company A described below. On April 25, 2014, representatives of Alcatel-Lucent, the Tallwood Group and management met at the Tallwood Group s office in Menlo Park, California, to discuss the Proposed Collaboration and potential structures and associated timing for an investment by Alcatel-Lucent and the Tallwood Group in support of the Proposed Collaboration. At this point, the parties discussed an equity financing commitment from each of Alcatel-Lucent and the Tallwood Group in the range of $10-12.5 million, for aggregate gross proceeds to us of $20-25 million. At a meeting of the special committee later on April 25, 2014, management updated the special committee on its discussions with the parties earlier that day. The special committee authorized management to continue its discussions with Alcatel-Lucent and the Tallwood Group and to explore various funding options and methods to raise capital in support of the Proposed Collaboration against the background of associated timing considerations. On May 2, 2014, management and Pillsbury met with the Tallwood Group and its counsel, Latham & Watkins LLP, or Latham, to discuss various funding structures and timing considerations. At that meeting, Latham and the Tallwood Group suggested an equity investment structured as a private placement followed by a rights offering so that all of our existing stockholders would have the opportunity to maintain their relative percentage ownership interest in our company with respect to the Tallwood Group, subject only to dilution arising from any equity investment by Alcatel-Lucent and other future issuances of equity. The parties discussed the fact that, depending on the size of the rights offering, it might be necessary to solicit stockholder approval to increase the number of authorized shares of common stock in order to achieve the goal of providing stockholders with an opportunity to maintain their full ownership interest relative to the Tallwood Group through participation in the rights offering (subject to any Over-Subscription Privilege). The parties also discussed the fact that the private placement could be closed relatively quickly, raising needed capital in the near-term, and that a rights offering would take longer to close because it was subject to the SEC s review process. During May 2014, management continued to analyze various funding options and structures, and associated timing considerations. Management also continued to meet with the special committee to discuss the various funding options and to update the special committee on the status of discussions relating to the Proposed Collaboration with Alcatel-Lucent. Management discussed with the special committee various structures, including an offering to the public generally, a private placement to the Tallwood Group and Alcatel-Lucent followed by a rights offering to all stockholders, and a convertible note offering, as well as the timing considerations related to each of the various structures. Management also discussed with the special committee the number of shares available for issuance in any funding scenario, and NASDAQ requirements and restrictions with respect to potential funding structures. NASDAQ restrictions included a requirement that, in light of the Tallwood Group s ownership position with respect to our company and the number of shares that would be required for the amount of financing that Alcatel-Lucent was requiring, the purchase price for the shares of our common stock could be no less than the greater of book value or market value on the day of the proposed private placement. Management and the special committee noted that this requirement would apply in our case despite the fact that many private offerings for public companies were priced at a discount to the market price. Accordingly, management and the special committee determined that a price equal to or greater than market would need to be negotiated with both Alcatel-Lucent and the Tallwood Group. Table of Contents The special committee met on May 2, May 7, May 9, May 10, May 21, and May 22, 2014, which we refer to as the May Meetings, to discuss various methods for raising capital, and the benefits and limitations of each of those financing methods, including timing considerations. On May 16, 2014, the special committee engaged Fenwick & West LLP, or Fenwick, as its independent legal counsel to advise the special committee with respect to the proposed transactions. At the May Meetings, the special committee considered the impact that Alcatel-Lucent s requirement that the Tallwood Group participate equally with Alcatel-Lucent in any financing would have on our other stockholders. The special committee also considered NASDAQ requirements as to pricing of a private placement. After considering all of these factors, the special committee determined to adopt a proposal that we provide our public stockholders an opportunity through a rights offering to purchase their pro rata share of our company s common stock at the same price as the private placement so that if they exercise their Basic Subscription Rights in full they will, subject to the Over-Subscription Privilege, maintain their ownership interest relative to the pre-Private Placement ownership of the Tallwood Group. Representatives of Pillsbury were present at the meetings on May 7, May 9, and May 22, and representatives of Fenwick were present at the meetings on May 21 and May 22. During this time, management held several separate conversations with Alcatel-Lucent and the Tallwood Group with respect to the form of investment and the concept of pricing a private placement at the same price as a rights offering. During these discussions, Alcatel-Lucent indicated an interest in increasing its investment to $15 million if the Tallwood Group would do the same, which the Tallwood Group agreed to consider. By late May 2014, management and the special committee had identified a structure consisting of a private placement to Alcatel-Lucent and the Tallwood Group in order to provide our company with capital meeting our short-term needs, followed by a rights offering which would provide stockholders at the time of the private placement an opportunity to purchase their pro rata share of our common stock at the same price as the private placement so that if those stockholders exercise their Basic Subscription Rights in full they will, subject to the Over-Subscription Privilege, maintain their ownership interest relative to the pre-Private Placement ownership of the Tallwood Group. In light of Alcatel-Lucent s condition that the Tallwood Group invest the same amount as Alcatel-Lucent, management suggested a structure where the Tallwood Group would serve as a committed standby purchaser in the rights offering. As a standby purchaser, the Tallwood Group would have a contractual obligation to purchase, in a subsequent private placement, any shares of our common stock that were not purchased in the rights offering by other stockholders, up to the Tallwood Group s total commitment of $15 million including the Tallwood Group s private placement purchase, pursuant to a standby purchase agreement. The use of this standby structure would allow existing stockholders the opportunity to participate on a pro rata basis in the rights offering, offsetting the dilution from the Tallwood Group s equity investment, and would provide us additional equity funding. The special committee and management continued to consider an appropriate pricing structure based on discussions with Alcatel-Lucent and the Tallwood Group, taking into account applicable NASDAQ regulations. At the special committee s meeting on May 22, 2014, at which representatives of Fenwick and Pillsbury were also present, management provided to the special committee initial drafts of term sheets for each of Alcatel-Lucent and the Tallwood Group that included, among other things, a $15 million equity investment by each of Alcatel-Lucent and the Tallwood Group, with a funding structure that provided for a private placement followed by a rights offering at the same price. Although the draft term sheets did not indicate a price per share for our common stock, the term sheets stated that the price per share would be equal to or greater than the greater of book or market value in accordance with NASDAQ regulations. The special committee also directed management to obtain fee estimates from three financial advisors identified by the special committee for an engagement to provide the special committee with financial analysis to assist it in determining the price of the private placement and the rights offering, and indicated that the special committee would select and retain a financial advisor after reviewing the proposals. Table of Contents On May 23, 2014, management sent draft term sheets with the terms and funding structure approved by the special committee to Alcatel-Lucent and the Tallwood Group. On May 26, 2014, the Tallwood Group provided its initial feedback to the term sheet with respect to registration rights and fees of its counsel. On May 28, 2014, Alcatel-Lucent and the Tallwood Group discussed the Proposed Collaboration and funding commitment, as well as possible structures for the funding. On May 30, 2014, the special committee met with management and Fenwick. Management reported on the status of negotiations, as well as the potential structure of the funding, including the possible issuance of preferred stock, change of control considerations, and rights offering mechanics. The special committee provided direction on these issues and authorized management to continue its discussions with Alcatel-Lucent and the Tallwood Group. On June 4, 2014, management began initial financial due diligence discussions with Alcatel-Lucent. On June 6, 2014, the special committee met with management and Fenwick. GCA Savvian Advisors, LLC, or Savvian, was also present for a portion of the meeting. Management reported on the continued negotiations with Alcatel-Lucent and with the Tallwood Group. Management also reported on proposals it had obtained from the three financial advisory firms previously identified by the special committee. Following the meeting, the special committee engaged Savvian for the limited purpose of providing financial analyses to assist in the pricing of the private placement and the rights offering by the special committee, including an analysis of stock price trading multiples for companies similar to us but that were well capitalized and did not have a need for capital in the near term. Savvian was not engaged by the special committee to provide a fairness opinion in connection with the private placement or the rights offering, nor was it engaged to assist with the exploration of other strategic alternatives, such as the sale of our company. On June 10, 2014, management provided updated term sheets to Alcatel-Lucent and the Tallwood Group providing for equity investment of $15 million each. On June 13, 2014, representatives of Savvian met with the special committee and Fenwick and presented a summary of stock price trading multiples for companies similar to us but which were well-capitalized and not in need of equity financing in the near term. Savvian noted that it thought that our then current trading valuation was depressed by near-term financial liquidly concerns (as well as the fact that we had recently provided guidance that reduced expected revenue for the next quarter) and our trading price did not necessarily reflect our fundamental prospects. Savvian noted that it thought that by completing a financing round that fully funded our required development efforts, our financial liquidity concerns could abate and the market could re-assess our stock valuation using multiples of operating metrics similar to those of comparable companies without near-term liquidity concerns. Based on this analysis, Savvian calculated a potential valuation range that the special committee could consider for pricing the private placement and rights offering that would reflect a premium to the current market price of our common stock and a discount to the potential future value of our common stock if the market valued our common stock based on similar multiples. Based on the number of shares of our outstanding common stock and the implied shares to be issued, the range was equivalent to $0.43 to $0.84 per share. On June 24, 2014, the special committee met with management. Management updated the special committee on its discussions with Alcatel-Lucent and the Tallwood Group, and Savvian provided the special committee with an updated analysis of potential pricing of the private placement and rights offering. In late June and early July 2014, management and Alcatel-Lucent continued to engage in financial diligence discussions. Table of Contents On July 1, 2014, Alcatel-Lucent discussed with the Tallwood Group its continued commitment to forming a strategic relationship with our company, and indicated that it might change the structure of its funding to provide more security for a significant portion of its investment. Thus, Alcatel-Lucent expressed its intention to reduce the relative size of its equity investment, and to fund a portion of its investment through a secured loan. The parties also discussed the timing for raising additional funds. After the call, the Tallwood Group provided a summary of its discussion with Alcatel-Lucent to management, noting that the new funding structure would be less dilutive to stockholders. In discussions unrelated to the foregoing potential transactions, Mr. Tahernia and executives from Company A held business discussions on July 2, 2014. The discussions were wide ranging and included a potential acquisition of us by Company A. Mr. Tahernia discussed the inquiry concerning an acquisition of us with Mr. Diosdado Banatao, our Chairman of the Board, the next day and Mr. Banatao encouraged Mr. Tahernia to meet with Company A again in order to better gauge Company A s level of interest. On July 10, 2014, Alcatel-Lucent provided its written response to the June 10 term sheet. Alcatel-Lucent s comments included a proposed $15 million funding package from Alcatel-Lucent, consisting of a $5 million equity investment and a $10 million secured loan with a first priority lien on all of our intellectual property. At our option, the proposed loan could be repaid in the form of future chip set sales resulting from the Proposed Collaboration. In its July 10 written response, Alcatel-Lucent also proposed that we issue Alcatel-Lucent a warrant to purchase an unspecified number of shares of our common stock in connection with the loan commitment. Following further negotiation regarding the other terms of the loan agreement, the parties agreed to the equivalent of 15% coverage of the principal amount of the loan, or a warrant to purchase up to approximately 3.2 million shares of our common stock. Finally, although we had discussed with Alcatel-Lucent providing to Alcatel-Lucent a board seat when the structure provided for a larger equity investment, in light of the new structure and the reduction of its equity investment, Alcatel-Lucent instead requested observer rights with respect to our board. Also on July 10, 2014, Mr. Tahernia met with members of Company A s management and discussed Company A s potential interest in an acquisition of us. Mr. Tahernia advised Company A that we were in discussions with other parties regarding a collaboration and a financing. Mr. Tahernia also suggested to Company A that it could participate in our financing transaction together with the other parties. On July 11, 2014, management and Alcatel-Lucent met to discuss various funding structures and conduct due diligence. Also on July 11, 2014, our board of directors met and management updated our board on the status of discussions with Alcatel-Lucent and the Tallwood Group, and our near-term need for capital. Our board of directors also considered the discussions that had occurred with Company A. Following discussion, our board of directors authorized management to enter into due diligence discussions with Company A. A representative of Pillsbury was present at the meeting. On July 14, 2014, the special committee met and management updated the special committee on the progress of negotiations with Alcatel-Lucent regarding the terms of its proposed investment and the collaboration. The special committee discussed, among other matters, that the new structure proposed by Alcatel-Lucent would be less dilutive to stockholders. Representatives of Fenwick were also present at the meeting. On July 15, 2014, Alcatel-Lucent and the Tallwood Group discussed certain changes proposed by Alcatel-Lucent in the structure of the financing, including Alcatel-Lucent s demand that a term sheet for a collaboration be in place in order for Alcatel-Lucent to make an equity investment in our company. The parties also discussed whether Alcatel-Lucent s loan would be subordinated to our other debt and the risks of an unsuccessful rights Table of Contents offering in light of the amount that we needed to raise in order to support the Proposed Collaboration. The Tallwood Group expressed concern over the time that had passed while negotiations and discussions continued, and our need for funding in the relatively near future. From July through September, Company A intermittently conducted due diligence on a number of occasions. On July 17, 2014, management sent to Alcatel-Lucent comments to Alcatel-Lucent s July 10, 2014 response to the term sheet that, among other terms, accepted Alcatel-Lucent s proposal to make a $5 million equity investment and a $10 million secured loan, which would be matched by a $15 million equity investment by the Tallwood Group, and agreed in concept to Alcatel-Lucent s request for a board observer. On July 18, 2014, Alcatel-Lucent and the Tallwood Group discussed the status of the negotiations. On July 22, 2014, management updated our board of directors on the status of the Proposed Collaboration and the funding plan consisting of a private placement, rights offering and Alcatel-Lucent s $10 million loan. A discussion of the status and our need for capital in the near term followed. Management also updated our board of directors on the status of the discussions with Company A regarding a potential acquisition. Our board of directors authorized management to continue discussions with Company A, to share with Company A our financing plans and to inquire as to Company A s interest in participating in the proposed financing. On July 28, 2014, Alcatel-Lucent and the Tallwood Group discussed possible structures. Alcatel-Lucent expressed concern that the amount to be raised in the rights offering was not guaranteed and it wanted assurances, as a condition to entering into a collaboration, that at least $45 million of funding would be raised. Following discussion, Alcatel-Lucent and the Tallwood Group focused on a structure in which the Tallwood Group would invest $22.5 million in equity, Alcatel-Lucent would provide $5 million in equity and a $10 million loan, as well as payments and other funding associated with the proposed collaboration agreement to bring the total amount of funding provided by Alcatel-Lucent to $22.5 million, and other existing stockholders would have the opportunity to participate in a rights offering to provide the potential for additional equity investment in our company and thereby avoid dilution to the existing stockholders. On July 31, 2014, Mr. Tahernia held additional discussions with Company A, and Company A expressed a desire to continue its due diligence. Following the conversations with the Tallwood Group on July 28, 2014, on August 8, 2014, Alcatel-Lucent informed management that it wanted to change its proposal for the funding. Alcatel-Lucent proposed a funding structure that included a funding commitment of $22.5 million by each of Alcatel-Lucent and the Tallwood Group, consisting of a $22.5 million equity investment by the Tallwood Group and a combination of $5 million in equity, a $10 million loan with warrant coverage, and $7.5 million of payments and other funding associated with the proposed collaboration. Later that day, the special committee met with management and Fenwick. Management updated the special committee on the status of the negotiations. The special committee discussed our cash needs and possible alternative funding sources or structures should the parties not be able to reach an agreement on the overall funding structure with Alcatel-Lucent and the Tallwood Group. On August 15, 2014, the Tallwood Group met with Company A and reiterated that Company A could participate in an equity financing as an alternative or precursor to an acquisition. Company A indicated that it was not interested in participating in an equity financing. The Tallwood Group communicated Company A s position on equity funding to management. Table of Contents On August 19, 2014, the special committee met and management updated the special committee on Alcatel-Lucent s most recent funding proposal. The special committee authorized management to continue discussions with Alcatel-Lucent and the Tallwood Group and provided management with a framework for negotiating the private placement price with Alcatel-Lucent and the Tallwood Group at a premium to the recent trading prices of our common stock. Representatives of Fenwick and Pillsbury were also present at the meeting. On August 20, 2014, the special committee met with management, Fenwick, Pillsbury and Savvian. Management updated the special committee on its discussions with Alcatel-Lucent and the Tallwood Group regarding the terms and structure of the proposed funding. Savvian updated its analysis to reflect the current stock price, consensus analyst projections, the target amount to be raised, and our most recently forecasted revenue growth relative to our peer group. For purposes of this analysis, Savvian assumed that we had a fully-funded plan and achieved our growth objectives. Using these assumptions, Savvian provided an analysis which illustrated the potential effect of a private placement and related rights offering at a price range of $0.70 to $0.90 per share. After discussion, the special committee authorized management in conjunction with Savvian to negotiate with the Tallwood Group a purchase price for the private placement in a price range of $0.75 and $0.85 per share. On August 21, 2014, management and Savvian met with the Tallwood Group and management made a proposal to price the private placement and rights offering at $0.80 per share. The Tallwood Group responded by asking Savvian to perform additional analysis of enterprise value and revenue multiples of companies similar to ours. At the time, our common stock was trading at $0.31 per share. The Tallwood Group also indicated that it would do its own analysis of pricing of private placements by companies in situations similar to ours. On August 25, 2014, Alcatel-Lucent and the Tallwood Group discussed the timing of the transaction and the possibility of setting up an in person meeting to help finalize terms. On the same day, management delivered to the Tallwood Group the information it had requested and as part of the presentation, proposed a price of $0.77, which was within the price range previously approved by the special committee. On August 26, 2014, Alcatel-Lucent and the Tallwood Group agreed to meet in person on August 28, 2014. The Tallwood Group also confirmed with our current lender its commitment to maintain a line of credit for us of at least $10 million. Prior to the closing of the private placement, management negotiated with the lender a commitment to extend its existing accounts receivable-backed line of credit with us for three years at $20 million. On August 28, 2014, management, Alcatel-Lucent and the Tallwood Group met at Alcatel-Lucent s corporate offices to discuss the structure, timing and investment levels of the proposed financing. Alcatel-Lucent continued to maintain that funding of $22.5 million from each of Alcatel-Lucent and the Tallwood Group would be a condition to its participation in a commercial arrangement with us. The Tallwood Group indicated that, while it did not originally intend to commit to that amount of funding, the Tallwood Group would consider raising its funding commitment to $22.5 million. On August 29, 2014, management provided Alcatel-Lucent with an updated term sheet that reflected a funding structure of a private placement followed by a rights offering, with Alcatel-Lucent and the Tallwood Group contributing aggregate funding of $22.5 million each. On September 6, 2014, management and the Tallwood Group discussed pricing of the common stock in the private placement and the rights offering. The Tallwood Group expressed the view that the price suggested by the special committee s proposal based on trading multiples of other companies was theoretical and not supported by the current market price or our recent performance, and expressed concern that the rights offering would not raise sufficient funds at a price of $0.77 per share. The Tallwood Group also noted that private placements by public Table of Contents companies are typically done at a discount to the current trading price and suggested that management gather data to determine what premiums or discounts to the trading price had been paid in similar private investments in public equities, or PIPES. The Tallwood Group then made a counter-proposal that the private placement and rights offering be priced at a 15% premium to the then current trading price of our common stock of $0.33 per share, or $0.38 per share. The special committee requested that Savvian provide the analysis requested by the Tallwood Group, and on September 8, 2014, Savvian provided the special committee with a survey of 37 comparable PIPEs completed since 2013 across multiple industry segments that raised less than $250 million. The survey noted that the average and median prices of those transactions were at a 5.9% discount and a 1.7% discount, respectively, to the then current trading price. Based on our trading price of $0.33 at the time, this would have resulted in a prices of $0.31 and $0.32 per share. The survey also noted that 15 of the 37 transactions were priced at a premium, ranging from 0.2% to 20%, with an average and median premium of 6.4% and 4.7%, respectively. Based on our trading price of $0.33 at the time, this would have resulted in prices of $0.35 and $0.345 per share, respectively. Representatives of Fenwick were present at the meeting on September 8, 2014. Also on September 8, 2014, management and Savvian presented to the special committee an analysis comparing a $0.77 per share offer price to the $0.38 per share offer price reflecting a 15% premium to market price suggested by the Tallwood Group. Management and Savvian noted that the $0.38 pricing would more likely secure the backing of the Tallwood Group, and that the pricing level would make participation by existing stockholders in the rights offering more likely. The special committee requested that Savvian prepare a survey of only those PIPEs involving affiliates. On September 10, 2014, Savvian provided an updated survey of private placements with affiliated investors. The transactions with affiliated investors reflected a wide range from a 35.7% discount to a premium of 20%, had a mean price reflecting a 2.7% discount and a median price reflecting a 1.6% premium, of which both indictors were well below the 15% premium proposed by the Tallwood Group. Based on our trading price of $0.34 at the time, this would have resulted in prices of $0.33 to $0.34 per share, respectively. On September 10, 2014, the special committee met with representatives of management, Fenwick and Savvian and reviewed the survey of pricing metrics for PIPEs prepared by Savvian. Taking this survey data into account, the special committee determined that it would be able to approve a price based on a reasonable premium to the trading price of our common stock as long as the rights offering included enough shares to permit our public stockholders which exercised their rights in full (subject to any Over-Subscription Privilege) at the same price paid by the Tallwood Group to maintain their relative ownership in our company with respect to the Tallwood Group. After further discussion, the special committee approved a structure in which the private placement with the Tallwood Group and Alcatel-Lucent would be made at a price per share equal to the greatest of (i) $0.40 (reflecting a 21% premium to the $0.33 closing price on September 9, 2014), (ii) 115% of the volume weighted average closing price of our common stock on NASDAQ over the 10 trading days prior to the private placement, and (iii) the greater of book value or fair market value on the day of the private placement in order to comply with the applicable NASDAQ rules. The special committee directed management to convey the proposal to the Tallwood Group and Alcatel-Lucent. Consistent with this direction, management reviewed with the special committee an analysis indicating that, in light of the proposed per share purchase price for the private placement and the rights offering, the number of shares needed in order to permit existing stockholders other than the Tallwood Group to maintain their relative ownership with respect to the Tallwood Group if those stockholders purchased their full pro rata share in the rights offering (including any Over-Subscription Privilege), the number of authorized shares in our certificate of incorporation would need to be increased. Later that day, management communicated to the Tallwood Group the special committee s proposed pricing structure. Table of Contents On September 12, 2014, Alcatel-Lucent and the Tallwood Group discussed the proposed terms of Alcatel-Lucent s loan, the rights offering mechanics, and the pricing structure proposed by the special committee and related NASDAQ requirements. Also on September 12, 2014, our board of directors met with management and Pillsbury and discussed a number of matters, including the status of our operations and cash position, and the status of the negotiations with Alcatel-Lucent and the Tallwood Group. Among the matters discussed were the benefits of increasing the size of the rights offering in order to allow existing stockholders who purchase their pro rata share in the rights offering to avoid dilution relative to the Tallwood Group, subject to the Over-Subscription Privilege in the rights offering. Management also updated our board of directors on the status of discussions with Company A. Our board discussed our immediate need for capital, the significant importance of the Proposed Collaboration and related funding to our business strategy and operations and the extremely early stage of the discussions with Company A compared to the near-term possibility of closing the transactions with Alcatel-Lucent and the Tallwood Group. Our board of directors considered whether there were other strategic alternatives available to the company that were likely to result in a better outcome for our stockholders than the transactions under consideration. After consideration of these and other matters, our board of directors (excluding Mr. Banatao, who did not attend the meeting, and Mr. Pavlov, who abstained from voting due to his affiliation with the Tallwood Group) authorized management to proceed with negotiation and finalization of definitive documentation based on the status of the negotiations with Alcatel-Lucent and the Tallwood Group but to continue discussions with Company A. On September 15, 2014, Alcatel-Lucent agreed to the special committee s proposal to price the private placement and the rights offering at a price per share equal to the greatest of (i) $0.40, (ii) 115% of the volume weighted 10-day average closing price of our common stock on NASDAQ, and (iii) the greater of book value or fair market value on the day of the private placement. On September 16, 2014, the Tallwood Group agreed to the same pricing formula subject to any significant change in the trading price of our common stock prior to the closing of the private placement. The special committee met with representatives of Fenwick present on September 17, 2014, to discuss the status of the negotiations. In light of the potential for the Tallwood Group, depending on the extent to which the other stockholders participate in the rights offering, to increase its ownership of our capital stock to more than 40% and possibly more than 50% of the outstanding voting stock, due to Alcatel-Lucent s requirement that the Tallwood Group commit to purchase $22.5 million of our common stock, the special committee instructed Fenwick to seek an agreement from the Tallwood Group that it vote any shares held in excess of 35% of our outstanding voting stock in the same proportion as the shares voted by all stockholders which are not affiliated with the Tallwood Group for a period of 10 years. Fenwick, Latham, the Tallwood Group and a representative of the special committee subsequently engaged in a series of negotiations regarding these voting provisions. The Tallwood Group noted that it was under no such voting prohibition at the present time and that in connection with its initial investment in 2009, the Tallwood Group had only agreed to vote shares in excess of 35% proportionately for a period of three years. The Tallwood Group proposed that, in light of the significant financial commitment that it was being required to make to meet Alcatel-Lucent s conditions to the Proposed Collaboration, the Tallwood Group should at most be required to vote shares in excess of 39.9% proportionately for a period of three years from the closing of the private placement. Following further negotiations between the special committee and the Tallwood Group, the parties agreed that the Tallwood Group would agree to vote shares in excess of 37.5% proportionately for a period of five years from the closing of the private placement. Table of Contents On September 18, 2014, management met with Company A to further due diligence discussions, and informed Company A that we were close to closing the private placement. Management highlighted our immediate need for additional financing to continue our operations and the potential strategic and operational benefits to us resulting from the Proposed Collaboration with Alcatel-Lucent. Management informed Company A that if we proceeded with the transactions, we would need to terminate discussions with Company A. Management shared with Company A the expected timing of the execution of the transaction documents, and that the private placement would be followed by a subsequent rights offering. At the meeting, Company A once again did not express any interest in participating in the financing and did not make any proposal with respect to a potential acquisition of us. Rather, Company A asked that we allow Company A to conduct a single additional diligence session the next day. On September 19, 2014, Company A engaged in further engineering-related due diligence. Company A did not, following that additional due diligence session, make a proposal for either a financing or an acquisition of us. On September 23, 2014, the special committee met together with management and representatives of Fenwick and Pillsbury. Although the potential business combination with Company A was outside of the special committee s charter, management updated the special committee on the status of discussions with Company A and informed the special committee that management had no expectation that Company A would make any proposal prior to the proposed closing of the transactions that would present a viable alternative for the board to consider. Accordingly, management planned to propose to our board of directors that discussions with Company A should be suspended pending completion of the private placement, when such discussions should be terminated. The special committee then discussed the various components of the proposed financing, including the private placement, the purchase price, the subscription price in any rights offering to be approved by our full board of directors, and the standby purchase. After discussion, including consideration of the other options available to our company, the special committee approved the Private Placement, the price per share of our common stock to be sold in the Private Placement and in the Rights Offering, the Standby Agreement, and the Stockholder Agreement with the Tallwood Group, which incorporated the proportional voting requirements described above. The special committee was also informed of the status of the discussions with Alcatel-Lucent regarding the Proposed Collaboration but took no action with respect to such collaboration or with respect to a potential acquisition transaction with Company A, as each such matter was to be reviewed by the full board of directors. Also on September 23, 2014, following the special committee meeting, our board of directors (excluding Mr. Banatao, who did not attend the meeting) met together with representatives of our management and Pillsbury to consider the actions taken by the special committee at its meeting, including the approval of: the Private Placement, the price per share at which our common stock would be sold in the Private Placement and the Rights Offering, the Standby Agreement and the Stockholder Agreement with the Tallwood Group. Members of the special committee summarized for the other members of the board the approvals made by the special committee at its preceding meeting, the extensive deliberations of the special committee that preceded such approvals, the reasons for such approvals, and noted that the special committee had acted unanimously, and conveyed to the other board members the support of the special committee members for taking all remaining actions necessary to implement the Private Placement, the Rights Offering and the other transactions, agreements and matters approved by the special committee. Our board of directors then discussed our immediate need for capital, the terms and conditions of the overall financing and related documents, and the significant importance of the Proposed Collaboration with Alcatel-Lucent to our future prospects. The board also discussed the absence of alternative financing or other strategic prospects, including that no proposal had been received from Company A regarding a potential acquisition, and that there was no expectation that Company A would be in a position to make a proposal, or that any such Table of Contents proposal, if made, would present an acceptable alternative to consider in light of the advanced stage of the negotiations with respect to the Proposed Collaboration and the associated funding, our immediate need for cash, and the significant strategic importance to our company of the Proposed Collaboration. After an extended discussion, our board members present at the meeting (excluding Mr. Pavlov, who abstained from voting due to his affiliation with the Tallwood Group) unanimously approved: (i) the Rights Offering at the Subscription Price, (ii) the issuance of shares of common stock in the Private Placement, the Rights Offering and the Standby Purchase, (iii) the ALU Loan Agreement, (iv) the Warrant, and (v) the term sheet. In addition, our board members present at the meeting unanimously approved an amendment to our certificate of incorporation to increase the number of shares of authorized common stock in order to achieve the goal of providing stockholders with an opportunity to maintain their full ownership interest relative to the Tallwood Group through participation in the Rights Offering (subject to the Over-Subscription Privilege in the rights offering), and the submission of that amendment to our stockholders for their approval at a special meeting to be held prior to commencement of the Rights Offering. In addition, our board approved an increase in the number of shares available for issuance under our current equity plan and the individual annual limits thereunder in order to, among other uses, provide flexibility to grant equity awards to our employees following the closing of the Private Placement and the Rights Offering Following those approvals, our board of directors directed management to terminate discussions with Company A upon closing the Private Placement. On September 24, 2014, our board of directors met to consider a provision in the stock purchase agreement proposed by Alcatel-Lucent which would prohibit us from consummating a sale of our company within six months following the closing of the Private Placement if such consummation would result in short swing liability to Alcatel-Lucent under Section 16(b) of the Securities Exchange Act of 1934, if applicable. Management and representatives of Pillsbury were also present at the meeting. Following discussion of the potential implications of the provision and consideration of the status of discussions with Company A, our board of directors (excluding Mr. Banatao, who did not attend the meeting, and Mr. Pavlov, who abstained from voting due to his affiliation with the Tallwood Group) approved the provision. On September 25, 2014, the special committee approved the same provision with respect to the Tallwood Group. In connection with the private placement and the rights offering, management and the compensation committee of our board of directors, or the Compensation Committee, discussed on several occasions, including the Compensation Committee meeting on September 23, 2014, the effect of those sales of our common stock on employee incentives. On September 26, 2014, management discussed with the Compensation Committee the impact the significant dilution arising from the Private Placement and Rights Offering would have on employee retention and morale. The Compensation Committee discussed possible approaches to addressing employee retention, including the grant of additional equity awards in the near term, and the need to obtain stockholder approval to increase both the number of shares available for issuance under our current equity plan and the individual annual limits under our equity plan. The Compensation Committee also discussed proposed public disclosure of our expectation that we would grant options to employees. The Compensation Committee discussed that, while it desired to provide assurance that dilution would be assuaged to employees, it did not want to grant equity incentives to employees until such time the Rights Offering was completed so it could calculate actual dilution to employees and could be assured that the price at which equity incentives were granted reflected all contemplated transactions. On September 28, 2014, the Compensation Committee met to discuss and review a draft disclosure to be included in the press release and Form 8-K announcing the Private Placement and related transactions with Alcatel-Lucent and the Tallwood Group, which described our general expectations with respect to the grant of equity awards to our employees and executive officers shortly after completion of the Rights Offering in order for our employees and executive officers to maintain their ownership percentage at a level generally commensurate with their ownership percentage immediately prior to the Private Placement, and to make Table of Contents performance-related grants to certain executives at the same time, subject to stockholder approval of an increase in the number of authorized share of our common stock and an increase in the number of shares reserved for issuance under our equity plan, with individual grants subject to approval by our Compensation Committee. We subsequently determined that we would grant the awards following the termination of the Rights Offering, with any options granted priced at the greater of the subscription price in the Rights Offering and the closing price of our common stock on the date on which the Rights Offering terminates. We also focused on our existing stock options and determined that almost all are significantly out of the money. We therefore determined that, following the Rights Offering and subject to the approval of our stockholders, we will offer a stock option exchange program to our employees and members of the board directors in order to encourage retention and engagement. The stock option exchange program will permit eligible employees and members of the board of directors to exchange certain outstanding stock options (vested or unvested) granted prior to January 1, 2014 with exercise prices equal to or greater than $0.41 per share, which we refer to as the Eligible Options, in exchange for a new stock option priced at fair market value on the date of grant, which will promptly follow the expiration of an exchange offer. We refer to these new awards as the Replacement Awards. With minor exception described in the next paragraph, each Replacement Award would be granted for the same number of shares as the underlying Eligible Option surrendered, except that the Replacement Award for our Chief Executive Officer, any officer who reports directly to our Chief Executive Officer and any member of the board of directors will be for 80% of the number of shares subject to the Eligible Option that is surrendered. Each Replacement Award will vest on a monthly basis over periods of 12-48 months, depending on the extent to which an Eligible Option has vested. For the Eligible Options that were granted to our Chief Executive Officer in 2012 as an inducement to accept employment but not pursuant to our stockholder approved equity plans, our Chief Executive Officer will be granted a Replacement Award for 80% of the number of shares subject to the Eligible Option surrendered. These options will vest (a) for shares that had previously been subject to certain performance targets under the Eligible Option, quarterly over one year after the stock price performance target is achieved, and (b) for shares that had previously been subject to time vesting, ratably on a monthly basis over 36 months. All Replacement Awards will have a new seven year term commencing on the date of grant. The stock option exchange program was approved by our stockholders on November 21, 2014. On September 29, 2014, we completed the Private Placement at $0.41 per share, or 115% of the 10-day weighted average closing price of our common stock on September 26, 2014, the last trading day prior to the closing date of the Private Placement, for aggregate gross proceeds of $16.25 million. In addition, we entered into the other transaction documents, issued the Warrant, and executed the term sheet, which outlines certain requirements, deliverables, milestones, payments and other funding under the collaboration, as well as certain pricing terms pursuant to which Alcatel-Lucent would purchase products from us. While the term sheet is, for the most part, binding, the terms of the collaboration will be further detailed in one or more definitive agreements, and entry into such definitive agreements is one of several conditions necessary in order for us to receive almost all of the payments and other funding, and to draw on the ALU Loan. By letter dated September 30, 2014, we terminated discussions with Company A concerning an acquisition of us. No proposal has been received from Company A regarding a potential acquisition or any other transaction. On November 21, 2014, our stockholders approved an amendment to our certificate of incorporation to increase the number of authorized shares of our common stock from 200 million to 425 million. Following the amendment of our certificate of incorporation, we increased to 144,925,083 the number of shares of our common stock purchasable pursuant to the exercise of Subscription Rights. Table of Contents The Rights Offering Securities to be offered by us We are distributing to you, at no charge, one non-transferable Subscription Right for every share of our common stock that you owned on the Record Date, either as a holder of record or, in the case of shares held of record by brokers, banks, or other nominees, on your behalf, as a beneficial owner of such shares. Size of Offering 144,925,083 shares. Subscription price $0.41 per share. Record date September 26, 2014. Subscription right Each Subscription Right consists of a Basic Subscription Right and an Over-Subscription Privilege. Basic subscription rights The Basic Subscription Rights will entitle you to purchase 1.459707 shares of common stock at the Subscription Price. You may exercise all or a portion of your Basic Subscription Rights or you may choose not to exercise any Subscription Rights at all. Over-subscription privilege If you exercise your Basic Subscription Rights in full, you may also choose to purchase a portion of any shares that are not purchased by our other stockholders through the exercise of their Basic Subscription Rights. You may subscribe for shares pursuant to this Over-Subscription Privilege, subject to proration and regulatory limitations described below. No fractional shares Fractional shares will not be issued upon the exercise of the Subscription Rights. Fractional shares of common stock resulting from the exercise of the Subscription Rights will be eliminated by rounding down to the nearest whole share, with the aggregate subscription payment being adjusted accordingly. Expiration date The Subscription Rights will expire at 5:00 p.m., Eastern Time, on , 2014. We reserve the right to extend the expiration date in our sole discretion. Procedure for exercising subscription rights To exercise your Subscription Rights, you must take the following steps: If you are a record holder of our common stock, you must deliver payment and a properly completed Rights Certificate to the Subscription Agent to be received before 5:00 p.m., Eastern Time, on , 2014. You may deliver the documents and payments by first class mail or courier service. If you use first class mail for this purpose, we recommend using registered mail, properly insured, with return receipt requested. If you are a beneficial owner of shares that are registered in the name of a broker, dealer, custodian bank, or other nominee, you should Table of Contents instruct your broker, dealer, custodian bank, or other nominee to exercise your Subscription Rights on your behalf. Please follow the instructions of your nominee, who may require that you meet a deadline earlier than 5:00 p.m., Eastern Time, on , 2014. You may also exercise your Subscription Rights by following the procedures for guaranteed delivery described under The Rights Offering Notice of Guaranteed Delivery. You may be required to provide a medallion guarantee of your signature on your Rights Certificate. Delivery of shares As soon as practicable after the expiration of the Rights Offering, the Subscription Agent will arrange for the issuance of the shares of common stock purchased pursuant to the Rights Offering. All shares that are purchased in the Rights Offering will be issued in book-entry, or uncertificated, form. If you hold your shares in the name of a custodian bank, broker, dealer, or other nominee, DTC will credit your account with your nominee with the common stock you purchased in the Rights Offering as soon as practicable after the expiration of the Rights Offering. Non-transferability of rights The Subscription Rights may not be sold, transferred, or assigned and will not be quoted on NASDAQ or listed on any stock exchange or market. No board recommendation Our board of directors is not making a recommendation regarding your exercise of the Subscription Rights. You are urged to make your decision to invest based on your own assessment of our business and the Rights Offering. Please see Risk Factors for a discussion of some of the risks involved in investing in our common stock. No revocation All exercises of Subscription Rights are irrevocable, even if you later learn of information that you consider to be unfavorable to the exercise of your Subscription Rights. You should not exercise your Subscription Rights unless you are certain that you wish to purchase additional shares of our common stock at the Subscription Price. The Subscription Price represents a 17% premium to the market price per share of our common stock on September 26, 2014, the trading day immediately prior to the closing date of the Private Placement, and may remain at a premium to the market price per share of our common stock at and after the closing of the Rights Offering. Standby purchase agreement Pursuant to the Standby Agreement, the Tallwood Group has agreed to acquire from us $11.25 million, or 27,439,023 shares, of our common stock, less any shares of our common stock it purchases in the Rights Offering. See The Standby Purchase. Use of proceeds We intend to use the net proceeds we receive from the offering for general corporate purposes. See Use of Proceeds. Table of Contents Material U.S. Federal income tax consequences For U.S. federal income tax purposes, you should not recognize income or loss upon receipt or exercise of a Subscription Right. You should consult your own tax advisor as to the tax consequences of the Rights Offering in light of your particular circumstances. See Material U.S. Federal Income Tax Consequences. Extension and termination Although we do not presently intend to do so, we have the option to extend the Rights Offering for additional time at our discretion. Our board of directors may for any reason terminate the Rights Offering at any time before the completion of the Rights Offering. We will notify stockholders if the Rights Offering is terminated or extended by issuing a press release. Subscription agent American Stock Transfer & Trust Company, LLC. Information agent D.F. King & Co., Inc., a division of American Stock Transfer & Trust Company, LLC. Questions If you have any questions about the rights offering, please contact the Subscription Agent, American Stock Transfer & Trust Company, LLC, at (877) 248-6417 or (718) 921-8317, or the information agent, D.F. King & Co., Inc., a division of American Stock Transfer & Trust Company, LLC, at (877) 478-5044. Market for common stock Our common stock is listed on NASDAQ under the symbol IKAN. See Price Range of Common Stock.
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our common stock, you should read the entire prospectus carefully, including the sections titled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our financial statements and related notes included elsewhere in this prospectus. Unless the context suggests otherwise, references in this prospectus to "CardioDx," the "Company," "we," "us" and "our" refer to CardioDx, Inc. Company Overview We are a molecular diagnostics company developing and commercializing novel, proprietary tests that help improve treatment decisions, enhance patient outcomes and reduce the overall cost of care. We use genomic technologies to provide healthcare professionals with critical, actionable information to improve patient care and management. Our product strategy addresses the needs of three key healthcare constituents: patients, healthcare providers and public and private payers. Our initial focus is on diagnostics for cardiovascular diseases, specifically coronary artery disease, or CAD, arrhythmia and heart failure. Our Corus CAD test is the first and only commercially available blood-based gene expression test that provides a current-state assessment for non-diabetic patients with symptoms that are suggestive of obstructive CAD. Corus CAD helps clinicians rule out obstructive CAD as the cause of these symptoms. Ruling out CAD as the cause of these symptoms can help avoid significant costs, risks and inconveniences associated with unnecessary referrals, non-invasive imaging and invasive coronary angiography, also known as cardiac catheterization. Our test has been clinically validated in independent patient cohorts, including two prospective, multicenter U.S. trials, PREDICT and COMPASS. Corus CAD became commercially available in 2009 and, through December 31, 2013, we have delivered results for over 55,000 tests. In August 2012, the Corus CAD test obtained Medicare Part B coverage, making the test a covered benefit for the estimated 49 million Medicare beneficiaries in the U.S. Cardiovascular diseases, or CVDs, are the leading cause of death worldwide. In the U.S., CAD, one of the most common CVDs, accounts for nearly one in six deaths according to the American Heart Association. We estimate that approximately three million non-diabetic patients in the U.S. with no prior revascularization, such as stenting or bypass surgery, and no prior myocardial infarction (heart attack) visit their primary care provider each year complaining of symptoms that may be suggestive of obstructive CAD. Studies have shown that only approximately 10% of patients who present to their primary care providers with symptoms suggestive of obstructive CAD actually have obstructive CAD, while the remaining approximately 90% of patients have symptoms that stem from other conditions, most of which are typically less urgent, such as musculoskeletal disorders, gastrointestinal disease and psychosocial syndromes. Nevertheless, patients' and providers' concern that the symptoms could be due to a cardiac cause, coupled with providers' concern for malpractice claims, have led physicians to over-refer patients to specialists and aggressively pursue costly and time-consuming cardiac diagnostic work-ups. We estimate that the total amount spent in the U.S. each year on these diagnostic work-ups, including non-invasive and invasive tests, in the non-diabetic population with no prior revascularization or myocardial infarction is approximately $5.9 billion. The $5.9 billion accounts for costs of advanced cardiac testing for patients initially evaluated in the primary care setting or cardiology offices. Despite the significant cost and use of existing non-invasive diagnostic tests such as myocardial perfusion imaging, or MPI, stress echocardiography and exercise electrocardiogram, only approximately 40% of patients who are referred for elective invasive coronary angiography are found to have actionable, obstructive Amendment No. 4 to FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents CAD. The over-utilization of non-invasive and invasive cardiac diagnostic testing has a negative impact on three key healthcare constituents: patients, who undergo unnecessary physician visits, testing and invasive procedures and are exposed to substantial medical risks, including procedural complications, side effects and high levels of radiation; providers, who spend time and resources pursuing incorrect diagnoses, resulting in potential delays in delivering appropriate treatment and lower patient satisfaction; and payers, who experience higher overall healthcare costs, including those resulting from unnecessary tests and referrals to specialists. In light of the Patient Protection and Affordable Care Act of 2010, as amended by the Health Care and Education Reconciliation Act of 2010, or collectively, the PPACA, both public and private payers are focused on lowering healthcare costs or at least ameliorating the current rapid expansion of costs and increasing efficiency of care. Managed care organizations and other payers continue to look for ways to promote interventions that are more effective for select groups of patients and that therefore provide an appropriate balance of benefits, risks and costs. As healthcare reform is implemented, we expect that there will be even more emphasis placed on avoiding procedures that have a low probability of changing a clinical decision, especially in large patient populations with high treatment costs such as the CAD market. We believe the gatekeeper nature of the Corus CAD test is well suited for this evolving healthcare landscape. Market Opportunity CVDs are the leading cause of death worldwide, representing 30% of all global deaths. The World Health Organization estimates that in 2008, 17.3 million people died from some form of CVD, mainly coronary heart disease and stroke. In the U.S. alone, according to the American Heart Association, CVDs accounted for almost 800,000 deaths in 2009, or about one in three deaths. The American Heart Association projects that by 2030, over 40% of the U.S. population will have some form of CVD. CAD is a subset of cardiovascular disease and is one of the most common types of heart disease. In 2008, an estimated 7.3 million people worldwide died of CAD. In the U.S., CAD caused one in six deaths in 2009. According to the American Heart Association, in 2010, CAD alone was projected to cost $108.9 billion in the U.S., including the cost of healthcare services, medications and lost productivity, with the total projected annual cost reaching $218.7 billion by 2030. The heightened public awareness of CAD and its symptoms and morbidity rates lead many patients to seek medical advice at the first sign of symptoms. Each year in the U.S. alone, approximately three million non-diabetic patients with no prior revascularization or myocardial infarction present in primary care offices with symptoms that can be suggestive of CAD. An additional approximately eight million patients present directly to hospital emergency departments each year with chest pain. Currently, those patients who present in outpatient settings undergo a number of different diagnostic tests and procedures in connection with the typical patient work-up to assess for obstructive CAD. These tests and procedures include, but are not limited to: non-invasive testing such as stress echocardiography, MPI and cardiac computed tomographic angiography; and invasive coronary angiography. There is significant variation among clinicians in the type, number and sequence of tests ordered to evaluate patients with typical or atypical symptoms suggestive of obstructive CAD. Discordant or indeterminate results from such tests are common particularly because of the subjectivity in interpreting the test results, and they can lead to additional testing or premature or unnecessary referral for invasive coronary angiography. The currently available non-invasive and invasive diagnostic tests for ruling out CARDIODX, INC. (Exact name of Registrant as specified in its charter) Delaware (State or other jurisdiction of incorporation or organization) 8071 (Primary Standard Industrial Classification Code Number) 65-1198370 (I.R.S. Employer Identification Number) CardioDx, Inc. 2500 Faber Place Palo Alto, California 94303 (650) 475-2788 (Address, including zip code and telephone number, of Registrant's principal executive offices) Table of Contents obstructive CAD in patients presenting with typical or atypical symptoms have substantial medical risks including complications, side effects and radiation exposure. Additionally, current usual care results in significant patient inconvenience, including loss of time associated with multiple referrals from one clinician to another, waiting periods to schedule additional appointments and the duration of the tests or procedures ordered, as well as other inconveniences associated with the tests or procedures. We estimate that the total amount spent on advanced non-invasive and invasive procedures for the non-diabetic patient population who initially present in primary care or cardiology offices with no prior revascularization or myocardial infarction in the U.S. is approximately $5.9 billion per year. Of this amount, approximately $3.0 billion is spent on MPIs, and $2.1 billion is spent on invasive coronary angiographies. Despite the significant cost and widespread use of existing non-invasive diagnostic tests such as MPI, the majority of patients referred for invasive coronary angiography do not have obstructive CAD. In 2010, data from the National Cardiovascular Data Registry, or NCDR, revealed that only approximately 40% of nearly 400,000 patients undergoing elective invasive coronary angiography had obstructive CAD. Of the approximately 60% of patients who underwent catheterization but were found not to have obstructive CAD, the significant majority (approximately 85%) of these patients had undergone at least one non-invasive diagnostic test for CAD prior to their catheterization. A clear need exists for a more accurate, safer and more convenient test to initially rule out patients with a low risk of obstructive CAD as the source of their symptoms. A better clinical paradigm would accurately rule out patients early in the diagnosis process, reducing unnecessary procedures, referrals, costs and risks, thereby benefiting patients, providers and payers. Our Solution Corus CAD is our clinically validated blood-based test for ruling out obstructive CAD in patients with symptoms suggestive of obstructive CAD. Our intended use population includes non-diabetic patients with, among other things, no prior revascularization or myocardial infarction. Corus CAD is a proprietary gene expression test that measures the expression levels of 23 distinct messenger RNA, or mRNA, sequences, the majority of which are known to be associated with atherosclerosis and involved in inflammation, cell death, and adaptive and innate immunity. In addition to gene expression levels, the Corus CAD algorithm incorporates the age and gender of the patient, which are also known to affect the likelihood of coronary disease. The test requires only a single routine blood draw, and the test result is generally available within 48 to 72 hours. The Corus CAD test does not subject patients to risks associated with other tests or procedures, including complications, side effects and radiation exposure, or delays associated with scheduling and performing other tests or procedures. The Corus CAD test yields a score along a 1 to 40 scale, with a lower score representing a lower likelihood of obstructive CAD. Used as an initial test, the Corus CAD test helps primary care clinicians and cardiologists evaluate whether to refer a patient for further cardiac testing or investigate other causes for the patient's symptoms. We perform the Corus CAD test in our clinical laboratory, which has been certified according to the Clinical Laboratory Improvement Amendments of 1988, or CLIA, under the regulations of the Centers for Medicare & Medicaid Services, or CMS, and also has been accredited by the College of American Pathologists, or CAP. In connection with our planned move to a new facility in the second quarter of 2014 to replace our existing corporate headquarters, including our laboratory space, we will need to replicate our testing processes and results in our new facility, and there can be no assurance that we will be able to do so prior to the time the lease for our current laboratory expires. Two prospective, multi-center clinical trials, PREDICT and COMPASS, validated the performance of the Corus CAD test in determining the likelihood of obstructive CAD in patient populations previously referred for invasive coronary angiography and MPI, respectively. MPI is a widely used non-invasive test to evaluate patients suspected of having obstructive CAD. In the COMPASS trial, at a score threshold of 15 or less, Corus CAD showed a sensitivity of 89% and a negative predictive value, or NPV, of 96%, compared to MPI, which showed a sensitivity of 27% and NPV of 88%. Sensitivity is the proportion of patients with disease David L. Levison President and Chief Executive Officer CardioDx, Inc. 2500 Faber Place Palo Alto, California 94303 (650) 475-2788 (Name, address, including zip code and telephone number, including area code, of agent for service) Table of Contents who test positive. NPV is the proportion of patients who test negative who do not have disease. The COMPASS results demonstrate that a low Corus CAD score (test score 15) has higher overall diagnostic accuracy than MPI for determining the absence of obstructive CAD. We believe the improved sensitivity and NPV of Corus CAD over MPI better position the Corus CAD test to identify low-risk patients initially presenting with typical or atypical symptoms suggestive of CAD. We have developed a robust evidence package to support the performance and utility of Corus CAD, which we use to educate clinicians and payers. In August 2012, our Corus CAD test obtained Medicare Part B coverage from Palmetto GBA, or Palmetto, the regional Medicare Administrative Contractor, or MAC, in California, for dates of service from January 1, 2012. On September 16, 2013, the regional MAC in California transitioned from Palmetto to Noridian Healthcare Solutions, LLC, or Noridian. The coverage for Corus CAD remains effective following this transition. Our coverage by Noridian provides for reimbursement at a fixed payment amount established by Palmetto for tests performed for qualifying Medicare patients throughout the U.S. so long as the tests are performed in our California laboratory. We believe our evidence package was significantly enhanced in 2013 and 2014 due to the publication of the COMPASS study and recent clinical utility studies and we will continue to generate, present and publish evidence to support further adoption of Corus CAD by clinicians and payers. However, no commercial third-party payer to date has made a positive coverage decision for Corus CAD. In addition, in connection with their standard review processes, several commercial third-party payers have made non-coverage determinations for Corus CAD, and some large commercial third-party payers have recently maintained existing non-coverage determinations for Corus CAD. We believe the gatekeeper nature of the Corus CAD test benefits patients, providers and payers by improving the quality and efficiency of care. Commercialization Strategy Our goal is for Corus CAD to be the primary first-line test used in a diagnostic work-up to assess the likelihood of obstructive CAD in symptomatic, non-diabetic patients. To succeed, we must significantly increase the commercial adoption of Corus CAD by: broadening payer coverage and reimbursement; expanding our sales presence; increasing market awareness; expanding our clinical and economic utility data; and pursuing relationships with commercial partners. Future Growth Opportunities We believe we can leverage our research expertise and commercial experience to develop additional revenue opportunities. Our research and development efforts focus on three principal areas: product line extensions or enhancements to expand the scope of our intended use population and indications or the development of additional algorithms that target specific patient populations, including the development of a Corus CAD test appropriate for diabetics; new product development in other areas of CVD, including our ongoing arrhythmia program; and technology platform development to increase efficiency and lower costs in our testing and laboratory operations. Copies to: Mark B. Weeks David G. Peinsipp Cooley LLP 3175 Hanover Street Palo Alto, California 94304 (650) 843-5000 Bruce K. Dallas Davis Polk & Wardwell LLP 1600 El Camino Real Menlo Park, California 94025 (650) 752-2000 Table of Contents Financial Overview Prior to Corus CAD obtaining Medicare Part B coverage in August 2012, we maintained a limited commercial sales force as we focused our efforts primarily on (1) developing and validating our test algorithm, (2) obtaining the necessary certifications and licensures for our laboratory, (3) launching and establishing early commercial experience with our test and (4) generating the clinical validity, clinical utility and economic value data necessary to create a robust evidence package that would be used to obtain reimbursement of our test and support clinician adoption. As a result, we generated nominal revenue and incurred significant operating losses over this period. Subsequent to Corus CAD obtaining Medicare Part B coverage in August 2012, and in anticipation of additional positive private payer decisions, we began to expand our commercial presence by increasing the size of our sales force and enhancing our marketing efforts. In the year ended December 31, 2013, we delivered results for 22,371 tests and generated $8.0 million in revenue. As of December 31, 2013, our total stockholders' deficit was $129.6 million and we had $26.6 million in cash, cash equivalents and investments. Risks That We Face Our business is subject to numerous risks and uncertainties, including those highlighted in the section entitled "Risk Factors" immediately following this prospectus summary. These risks include, among others, the following: Our financial results currently depend almost entirely on the sales of one product, our Corus CAD test, and we will need to generate significant revenue from this test in order to achieve profitability. We have a limited commercial history. We have incurred significant losses since our inception, and we expect to incur losses for the current fiscal year and the next several years. Our strategy depends on achieving greater market acceptance of our Corus CAD test, which will require us to expand our sales and marketing capabilities in order to increase demand for the test, expand geographically and obtain favorable reimbursement determinations from third-party payers. Health insurers and other third-party payers may decide not to cover our diagnostic products or may provide inadequate reimbursement, which could jeopardize our commercial prospects. Medicare reimbursements currently comprise a significant portion of our revenue, and we may not be able to maintain or increase the number of our tests reimbursed by Medicare or their reimbursement levels. If we are unable to compete successfully, we may be unable to increase or sustain our revenue or achieve profitability. Healthcare reform measures could hinder or prevent the commercial success of Corus CAD. Changes in Medicare Administrative Contractor services could alter current Medicare coverage or payment amounts. Our Medicare Part B coverage is not a formal coverage determination by CMS, and any future adverse coverage decisions by CMS could substantially reduce our revenue. We do not currently have any issued patents covering Corus CAD. We may be unable to obtain, maintain and enforce the patent and other intellectual property rights necessary to protect our technologies and tests. Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement. Table of Contents Our business is subject to complex and sometimes unpredictable government regulations. If we fail to comply with these regulations, we could incur significant fines and penalties. Corporate Information We were incorporated in Delaware as CardioDx, Inc. in July 2003. Our principal executive offices are located at 2500 Faber Place, Palo Alto, California 94303, and our telephone number is (650) 475-2788. Our website address is www.cardiodx.com. Information contained on or accessible through our website is not a part of this prospectus and should not be relied upon in determining whether to make an investment decision. CardioDx , the CardioDx logo, Corus and other trade names, trademarks or service marks of CardioDx appearing in this prospectus are the property of CardioDx. Trade names, trademarks and service marks of other companies appearing in this prospectus are the property of their respective holders. We do not intend our use or display of other companies' trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, these other companies. We are an "emerging growth company" as defined in the recently enacted Jumpstart Our Business Startups Act, or the JOBS Act, and therefore we may take advantage of certain exemptions from various public company reporting requirements, including not being required to have our internal controls over financial reporting audited by our independent registered public accounting firm pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and any golden parachute payments. We may take advantage of these exemptions until we are no longer an "emerging growth company." In addition, the JOBS Act provides that an "emerging growth company" can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have irrevocably elected not to avail ourselves of this exemption, and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not "emerging growth companies." We will remain an "emerging growth company" until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of this offering, (b) in which we have total annual gross revenue of at least $1.0 billion or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company Table of Contents The Offering Common stock offered by us shares Common stock to be outstanding after this offering shares Option to purchase additional shares The underwriters have an option to purchase up to additional shares of our common stock. Use of proceeds We estimate that our net proceeds from this offering will be approximately $ million (or $ million if the underwriters exercise their option to purchase additional shares in full), based on an assumed initial public offering price of $ per share, the midpoint of the price range set forth on the cover page of this prospectus, and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. We currently intend to use the net proceeds from this offering as follows: approximately $ million to provide working capital to expand our commercial organization, including sales and marketing personnel; approximately $ million to conduct additional clinical and marketing activities to enhance our evidence package for Corus CAD; and the remainder for research and development purposes as well as for general corporate purposes. We may also use a portion of the net proceeds from this offering for acquisitions of, or investments in, technologies, solutions or businesses that complement our business, although we have no present commitments or agreements to enter into such acquisitions or investments. The amounts and timing of our actual expenditures may vary significantly depending on numerous factors, including the progress of our commercialization efforts, the status of additional payer reimbursement coverage determinations for Corus CAD and the results of our research and development efforts. In particular, if we do not obtain positive coverage decisions from commercial payers in a timely manner, we may decide to postpone expansion of our commercial organization, including sales and marketing personnel, and reallocate that portion of the net proceeds from this offering to clinical and marketing activities to obtain such positive coverage decisions and to fund continuing operating losses during that additional time. In that event, we may also reallocate certain of such net proceeds from this offering for general corporate purposes. Accordingly, we will have broad discretion over the uses of the net proceeds from this offering. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission acting pursuant to said Section 8(a), may determine. Table of Contents Pending these uses, we intend to invest the net proceeds from this offering in short-term, investment-grade interest-bearing securities such as money market funds, certificates of deposit, commercial paper and guaranteed obligations of the U.S. government. See "Use of Proceeds" for additional information.
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our common stock, you should carefully read this entire prospectus, including our consolidated financial statements and the related notes thereto and the information set forth under the sections Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations, in each case included in this prospectus. Unless the context otherwise requires, we use the terms Amber Road, company, we, us and our in this prospectus to refer to Amber Road, Inc. and its consolidated subsidiaries as a whole. Overview Our mission is to dramatically change the way companies conduct global trade. As a leading provider of cloud-based global trade management (GTM) solutions, we automate import and export processes to enable goods to flow across international borders in the most efficient, compliant and profitable way. Our solution combines enterprise-class software, trade content sourced from government agencies and transportation providers in 125 countries, and a global supply chain network connecting our customers with their trading partners, including suppliers, freight forwarders, customs brokers and transportation carriers. We deliver our GTM solution using a Software-as-a-Service (SaaS) model and leverage a highly flexible technology framework to quickly and efficiently meet our customers unique requirements around the world. In 2013, we processed over 600 million transactions and supply chain messages on our network. Sustained increases in international trade volumes are driving demand for our solution. For example, the U.S. Department of Commerce reported that in 2012, U.S. companies imported approximately $2.3 trillion of goods and exported approximately $1.5 trillion of goods. The Congressional Research Service reports that in 2012, China overtook the United States as the world s largest trading economy, with the value of Chinese merchandise imports reaching approximately $1.8 trillion and the value of Chinese merchandise exports reaching approximately $2.1 trillion. Many of our multi-national enterprise customers have a presence in China, and to increase our share of this growing market, in September 2013 we acquired EasyCargo, a Chinese SaaS global trade management solution provider focused on companies conducting global trade in China. In addition to rising global trade volumes, importers and exporters must cope with growing supply chain complexity. A single shipment may involve more than a dozen parties, multiple languages, time zones, currencies, modes of transport and a large number of ever-changing laws and regulations. To address this complexity, many global trade participants require dedicated staff to interpret and comply with intricate, country-specific trade regulations, which are often published on paper in varying formats. For example, there are over 500 free and preferential trade agreements around the globe, each requiring importers to comply with myriad rules before they can take advantage of reduced duty rates to lower their product costs. Further, global trade participants must obey thousands of import and export regulations and screen their shipments against approximately 200 lists containing an aggregate of over 250,000 restricted parties. According to a 2013 SCM World survey that we commissioned, over half of the respondents indicated that complying with global trade regulations was one of their top challenges, yet less than 4% indicated that their import compliance was fully automated. Failure to manage the complexity of global trade results in poor supply chain performance, increased costs, and exposure to fines and penalties. Conversely, companies that excel in global trade management enjoy a distinct financial advantage in the marketplace. Expanding global trade and mounting supply chain complexity have increased demand for GTM solutions. According to a 2013 ARC Advisory Group report that we commissioned, the addressable global market for GTM solutions for companies that import and export goods was approximately $6.1 Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED MARCH 5, 2014 PRELIMINARY PROSPECTUS 6,522,000 Shares Common Stock per share We are offering 4,782,870 shares of our common stock and the selling stockholders are offering 1,739,130 shares of our common stock. This is our initial public offering and no public market currently exists for our shares. We have applied to list our shares of common stock on the New York Stock Exchange under the symbol AMBR. We anticipate that the initial public offering price will be between $10.50 and $12.50 per share. We are an emerging growth company under applicable federal securities laws, and will be subject to reduced public company reporting requirements. Investing in our common stock involves risks. See Risk Factors beginning on page 13. Per Share Total Public offering price $ $ Underwriting discount(1) $ $ Proceeds, before expenses, to us $ $ Proceeds, before expenses, to selling stockholders $ $ (1) See Underwriting beginning on page 123 for additional disclosure regarding underwriting commissions and expenses. The underwriters hold an option to purchase up to 978,300 additional shares from the selling stockholders, at the public offering price, less the underwriting discount, for 30 days from the date of this prospectus. We will not receive any of the proceeds from the sale of shares by the selling stockholders. The underwriters expect to deliver the shares of common stock on or about , 2014. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. Stifel Pacific Crest Securities Canaccord Genuity Needham & Company Raymond James The date of this prospectus is Table of Contents billion in 2012, with market penetration of 6%. As a market leader, we believe we are poised to capture an increasing percentage of the GTM market by maintaining a state of the art GTM solution and increasing our sales and marketing activities. We deliver our solution in individual modules or as a suite, depending on our customers needs, utilizing a highly flexible technology framework. This cloud-based suite addresses the growing complexity of the global trade landscape by automating GTM functions to minimize import and export costs, optimize transportation, track shipments within a supply chain, and automate compliance with regulations and free trade agreements. Without this delivery in the cloud, it would be difficult to effectively enable collaboration among the large number of trading partners involved in a global supply chain. Our solution integrates Global Knowledge, a vast library of regulations and other content that we transform into a proprietary knowledgebase that enables our customers to automate GTM functions across 125 countries. Global Knowledge includes import and export regulations, shipping documents, preferential duties and taxes, specifications for free trade agreements, transportation rates, sailing schedules, embargoed country and restricted party lists, and harmonized tariff codes that identify goods based on standardized classifications, all sourced directly from government agencies and transportation carriers. Finally, our GTM solution includes a global supply chain network of connections to our customers trading partners, allowing us to deploy our solution efficiently and economically. Because global trade processes vary across industry verticals and countries, no single software or SaaS solution built with traditional technologies can serve the needs of every participant in a global supply chain. To address these variations, we built our GTM solution using a proprietary technology architecture that we refer to as our Enterprise Technology Framework. Our Enterprise Technology Framework separates customer-specific configurations in each deployment from our core application, permitting our customers to configure our GTM solution without one-off customizations. This in turn permits us to maintain a single version of our software across deployments, facilitating our development cycle and simplifying upgrades for our customers. Our GTM solution drives value to our customers through faster and more predictable delivery times, less labor, reduced in-transit inventories, and reduced international trading costs such as brokerage fees, logistics fees, transportation costs and customs duties. Our customers have expressed satisfaction with the value they derive from our solution in our annual internal customer satisfaction surveys. In 2013, we sent these surveys to all of our customers and approximately one-third of them responded. For each of our fiscal years ended December 31, 2011, 2012 and 2013, our recurring revenue retention was 102%. We calculate our recurring revenue retention rate by comparing, for a given quarter, subscription revenue for all customers in the corresponding quarter of the prior year to the subscription revenue from those same customers in the given quarter. For the annual rate, we utilize the average of the four quarters for the stated year. We sell our GTM solution to many of the largest enterprises in the world, including companies such as General Electric, Monsanto, Sherwin Williams, Tyco International, Walmart and Weatherford International. In 2011, 2012 and 2013, our solution served 351, 399 and 463 customers, respectively, representing diversified industry verticals including Chemical/Pharmaceutical, High Technology/Electronics, Industrial/Manufacturing, Logistics, Oil & Gas, and Retail/Apparel. Although our customers are headquartered primarily in the United States and Europe, we have deployed our solution to their users in more than 80 countries. We define customers to include only those customers from whom we generate revenue. We have achieved consistent revenue growth while expanding our global presence. Our revenue has grown from $37.6 million in 2011, to $43.4 million in 2012 to $52.5 million in 2013. This represents annual growth of 15.4% and 21.0% for our two most recent fiscal years. Revenue increased from $11.3 million for the three months ended December 31, 2012 to $15.6 million for the three months ended Table of Contents Powering Global Trade Table of Contents December 31, 2013, representing 38.1% annual growth. EasyCargo accounted for approximately 3% of our revenues in the fourth quarter of 2013. We had net losses of $4.6 million, $2.1 million, and $14.4 million for the years ended December 31, 2011, 2012, and 2013, respectively, and net losses of $0.5 million and $0.5 million for the three months ended December 31, 2012 and 2013, respectively. Our Industry Most global trade functions historically have been handled manually by outsourced service providers and internal specialists. Early global trade automation software focused narrowly on discrete problems such as restricted party screening and shipment tracking. These software programs were not integrated with each other or existing enterprise software and were weak in functionality. At the same time, demand for global trade automation has increased rapidly over the past 10 years, fueled by a combination of macro and microeconomic trends. We believe these trends will continue to support the rapid increase of global trade and demand for GTM solutions. According to the SCM World survey, over 75% of respondents agreed that delayed shipments and other customs problems materially impacted customer service, and nearly 90% agreed that unpredictable lead times on international shipments materially impacted customer service. Further, over 50% of the respondents agreed that their inability to take advantage of preferential duty programs or free trade agreements was costing them a material amount today and that these costs were likely to increase going forward. Our Solution We deliver a broad GTM solution that encompasses enterprise-class software, trade content, a global supply chain network, and highly flexible technology architecture. By automating more GTM processes, we enable our customers to enjoy significantly lower supply chain costs compared to legacy systems. The critical components of our solution include: Enterprise-Class Software. Our solution consists of integrated software modules that automate most GTM functions. Customers can subscribe for modules individually or as a suite, depending on their needs. Each module contains a rich, configurable feature set, intuitive user interface, workflow engines to process business rules that permit management by exception, and application programming interfaces to connect each module to other enterprise systems. Our solution is based on our proprietary Enterprise Technology Framework and is engineered to be stable and deliver high performance to automate the world s largest businesses. Trade Content. In addition to powerful software, automating global trade to its full potential requires trade content. Trade content is information that we source from government agencies and transportation carriers, which, when used with our software, enables trade automation. Trade content includes harmonized tariff codes, restricted party lists, export regulations, import regulations, shipping documents, preferential duties and taxes, specifications for free trade agreements, transportation rates, and sailing schedules. Supply Chain Network. To automate global trade, we connect our customers to their extended supply chain partners, including suppliers, freight forwarders, transportation carriers, and customs brokers. Each of these parties requires access to trade content, messages, alerts, and information services at critical points along the supply chain. This coordination enables us to automate more GTM processes than would otherwise be possible. Flexible Technology. GTM processes vary across industry verticals and countries, and one solution cannot fit every customer and its trading partners. Therefore, we simplify GTM automation by utilizing our Enterprise Technology Framework, a highly flexible technology framework. The most important capability of Enterprise Technology Framework to our customers, and the most difficult technical problem it solves, is permitting our professional services organization to configure our solution during implementation in a manner that separates customer-specific configurations from our core application, Table of Contents In 2013, Amber Road processed over 600 million transactions and supply chain messages on its cloud based trading network and made over 13 million regulatory updates to its Global Knowledge repository of trade regulations. SOURCE Amber Road DESTINATION Our GTM solutions automate import and export processes to enable goods to flow across international borders in the most efficient, compliant and profitable way. SOURCING OPTIMIZATION SUPPLIER MANAGEMENT TRANSPORTATION MANAGEMENT EXPORT MANAGEMENT SUPPLY CHAIN VISIBILITY IMPORT MANAGEMENT FREE TRADE AGREEMENTS Table of Contents allowing our customers to upgrade to new versions of our solution while retaining their configurations and avoiding the need for re-implementation. The power of our Enterprise Technology Framework is in allowing our solution to adapt to large and small businesses in all industry verticals globally. We maintain this flexibility even as we integrate our solution with our customers enterprise resource planning systems, and because global trade requirements change frequently, our configuration-without-customization approach permits our solution to adapt to these changes at a low cost. SaaS Delivery. We are a SaaS company and deliver our solution primarily over the Internet using an on-demand, cloud-based, delivery model. Approximately 91% of our customers have selected this approach as their sole delivery model for our solution. Our customers also have the option to deploy certain solution modules in their own IT environments. Regardless of the delivery model, we sell our solution through subscription agreements that entitle our customers to access our solution and receive support. Because our Global Knowledge trade content is delivered and managed in the same manner regardless of delivery model, and because we configure our solution according to customer needs without modifying our core software, our customers receive the latest trade content and new versions of our solution under both delivery models. Benefits of Our Solution We change the way our customers conduct global trade. Many of our customers, including some of the world s largest enterprises, automated their global trade processes for the first time with our solution. We deliver a broad GTM solution that eliminates manual processes, reduces transportation costs, optimizes logistics, leverages trade agreements, provides shipment tracking, and ensures compliance with import and export regulations. In 2013, we processed over 600 million transactions and supply chain messages on our network. Process Automation. Our solution eliminates paper in favor of organized electronic data, messages and alerts and replaces tedious manual processes, such as researching trade regulations, classifying goods against harmonized tariff codes, calculating duties and taxes, phoning transport carriers to solicit transportation quotes or shipping schedules, and chasing down shipment status from myriad carrier websites, with an integrated solution suite. By integrating with global trading partners, our GTM solution aims to achieve straight-through-processing, so that goods and their related shipping documents move from source to destination with little or no management intervention. Cost and Route Optimization. Our trade content includes information relating to preferential duties and taxes, specifications for free trade agreements, transportation rates, and sailing schedules. Our solution combines this information with carrier shipping contracts to enable customers to compare rates, routes and other charges based on constantly changing data in near real-time. With an enhanced view of landed cost, supply chain executives can select and optimize the routes over which goods flow through their global networks to achieve sustainable delivery performance improvements and cost savings. Cost and route optimization enables our customers to achieve performance improvements that include faster delivery times, improved responsiveness to their customers needs and cost savings such as reduced transportation costs. Nearly half of the respondents in the SCM World survey indicated that an inability to control global transportation costs was one of their top concerns as a global business. Supply Chain Visibility. Our supply chain visibility solution connects our customers with their overseas suppliers, logistics providers, brokers and carriers to track and monitor goods in near real time as they move through the global supply chain. Our solution achieves this by tracking in-transit shipments using reference points such as booking number, container number and bill-of-lading number, and alerts customers to issues that affect supply chain performance. Supply chain visibility empowers our customers to manage by exception, allowing them to rely on our solution to monitor the status of goods in transit and to alert them when problems arise. More than half of the respondents in the SCM World survey indicated that a lack of visibility of shipments moving through the global supply chain was one of their top concerns as a global business. Table of Contents Table of Contents Enhanced Compliance. Our solution assists customers in managing significant areas of legal and regulatory compliance for global trade, including line-by-line review of sales orders for licensing requirements, and screening for embargoed countries and restricted parties. The benefits of enhanced compliance include avoiding costly fines and possible criminal liability. We believe that the cost savings realizable from the foregoing benefits, including reduced landed costs, administrative expenses and avoidance of fines and penalties, can result in significant returns on investment for our customers. Our Growth Strategy We intend to expand our role as a provider of a market-leading GTM solution by bringing our existing solution to new customers and new markets, and by expanding our solution to offer the most comprehensive and innovative features in the GTM marketplace. Key elements of our growth strategy include our plans to: Invest in Sales. As a complement to our investment in infrastructure, in 2012 we began to invest more heavily in our sales force, which has led to an acceleration of our business. We expect to continue to ramp our investment in sales by hiring new sales directors and supporting personnel, particularly for territories outside of the United States, including China. We will focus our expanded sales efforts on acquiring new customers and, to a lesser extent, selling more modules to our existing customers. Invest in Marketing. In 2012, we also began to invest more heavily in marketing. We plan to continue this expansion by maintaining our marketing focus on lead generation, in particular by running more marketing programs to jump-start new territories. We also expect to devote additional resources to solidifying our brand as a leading GTM solution provider. Further International Expansion. Currently, we sell our solution predominantly in the United States, regions of Europe and China, where we target our marketing efforts and maintain dedicated inside and outside sales persons. Because our solution has a global appeal, we believe that there are significant opportunities in the rest of the world, particularly in Brazil, Russia and India. Our past efforts have resulted in implementations with multi-national corporations headquartered primarily in the United States and Europe who have users in more than 80 countries, giving us a foothold in many countries where we currently have no sales offices. We intend to invest in new sales and support offices in these regions which will build on our pre-existing user base. Expand our Solution. We have a history of bringing an innovative solution to market as demonstrated by our robust Global Knowledge library and flexible, proprietary Enterprise Technology Framework. Currently, we have dedicated more than 54% of our employees to solution development, and we will continue to leverage our solution team to expand the depth and breadth of our solution in response to customer requests and the evolving nature of global trade. For example, we may expand our solution to automate working with free trade zones, which are areas where goods may be imported, transformed, and then exported without the need to pay customs duties. We also intend to maintain our market leadership in trade content. Execute Strategic Acquisitions. Strategic acquisitions represent an opportunity for us to augment our solution capabilities and sales team. The GTM solutions market is fragmented, and we believe some participants may have best-of-breed solutions to specific problems, particularly those created by the unique trading requirements of foreign countries. We may acquire those participants to expand our solution. Further, developing an effective sales force in foreign markets requires a nuanced understanding of local business customs. We may, for example, choose to acquire local GTM software companies in order to obtain sales teams with a track record of success in their markets. We currently have no agreements or understandings to acquire any such companies, however, in September 2013, we acquired EasyCargo, a Chinese SaaS global trade management solution provider focused on trade management in China. Table of Contents TABLE OF CONTENTS Page Prospectus Summary 1
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+Prospectus summary This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our common stock, you should carefully read this entire prospectus, including our consolidated financial statements and the related notes and the information set forth under the section titled Risk factors, included elsewhere in this prospectus. Unless the context otherwise requires, we use the terms Everyday Health, company, our, us, and we in this prospectus to refer to Everyday Health, Inc. and, where appropriate, our subsidiaries. Everyday Health, Inc. Overview We are a leading provider of digital health and wellness solutions. We combine premier digital content from leading health brands with sophisticated data and analytics technology to provide a highly personalized and differentiated content experience to our users. During 2013, we estimate an average of 43 million consumers and 500,000 healthcare professionals, including one-third of all U.S. physicians, engaged with our health and wellness properties each month across multiple channels, including the web, mobile devices, video and social media. Our content portfolio and data and analytics expertise provide marketers with a compelling platform to promote their products and services in a highly targeted and measurable manner, influence purchase decisions and drive better health compliance. We believe that we are well positioned to capitalize on new revenue opportunities presented by the growing importance of consumer engagement, data and analytics and digital technologies in the rapidly evolving health and wellness industries. We are beginning to utilize our existing content, large audience and sophisticated technology platform to enable healthcare payors, providers and employers to drive consumer engagement, improve health outcomes and reduce healthcare costs. We provide consumers and healthcare professionals with a multi-brand, multi-channel content experience that can be accessed anytime and anywhere a health-related decision is made. Consumers use our content, interactive tools and mobile applications to manage a broad array of health and wellness needs on a daily basis, including weight loss, exercise, healthy pregnancy, diet and nutrition and medical conditions. We also provide healthcare professionals with news, tools and information needed to stay abreast of industry, legislative and regulatory developments in major medical specialties. Our consumers and healthcare professionals increasingly access our content through mobile devices. Accordingly, we have optimized our platform for mobile access, including the development of 26 mobile applications that have been downloaded over 15 million times. Our portfolio of properties includes leading brands such as Everyday Health, MedPage Today, What To Expect, Mayo Clinic, Jillian Michaels and The South Beach Diet, and incorporates content from highly respected health authorities such as Dr. Sanjay Gupta. Our premium content has enabled us to aggregate a large and engaged audience of consumers and healthcare professionals. In each of the past three years, over five million consumers have registered with us and voluntarily provided us with valuable data, including demographic information and health related interests. We augment our user profiles by collecting behavioral data through engagement with our properties and appending data from third party sources. Our proprietary technology utilizes the data we collect to provide a highly personalized experience for our users, including customized content, drive better health outcomes and connect users looking for support. We derive a significant majority of our revenues from the sale of advertising, sponsorships and other marketing solutions that engage consumers and healthcare professionals. We have developed strong relationships with marketers across a variety of health and wellness categories, including pharmaceuticals, over-the-counter products, food, retail and lifestyle. For example, during 2013, our customers included ten of the top 25 global advertisers in 2012, as compiled by Advertising Age, and 23 of the top 25 global pharmaceutical companies ranked by 2012 revenue. We specialize in providing these marketers with highly-customized, data-driven marketing solutions that can precisely target niche health audiences, and which are designed to be effective on a desktop or mobile device. Our innovative programs, which utilize sophisticated campaign analytics to measure and maximize a marketer s return on investment, or ROI, have been instrumental in significantly growing our revenue among our largest customers. Industry dynamics The U.S. healthcare industry is undergoing a profound transformation whereby consumers will likely be more directly engaged in managing their health and making health-related purchase decisions. At the same time, digital technology is providing new avenues for consumers to manage their health, healthcare professionals to stay informed and treat patients, marketers to reach and influence customers, and payors to improve care and lower cost. Consumers. Consumer engagement in health and wellness has significantly increased as a result of the growth of digital content and tools and the shift towards consumers being forced to bear more of their healthcare costs. Consumers are increasingly using digital media to obtain critical information, participate in online health communities, make daily health and wellness decisions and manage serious medical conditions. During 2013, on average, approximately 132 million unique visitors accessed health-related websites per month in the U.S., an increase from approximately 94 million on average in 2009, according to comScore. Moreover, the widespread adoption of mobile devices is allowing consumers to directly manage and monitor their health in unprecedented ways. Healthcare Professionals. Healthcare professionals seek to keep current on medical developments, utilize new tools to acquire patients and develop different ways to engage their patients in directly managing their health. Recent industry changes, such as the introduction of healthcare exchanges and reforms to the healthcare payment model that increasingly base payments to physicians on health outcomes, will accelerate the need for healthcare professionals to stay informed and improve the quality of care. As a result, we believe that physicians will increasingly utilize digital and mobile solutions to better manage these challenges. Marketers. As more consumers and healthcare professionals utilize the Internet and digital solutions in their daily lives, marketers increasingly view digital marketing as a more effective means for engaging a targeted audience, as compared to traditional marketing channels. Pharmaceutical marketers, in particular, are facing a number of key challenges, including a shift from mass-market drugs to specialty medications, dramatically-reduced sales forces and other restrictions on interacting directly with physicians, which we believe will significantly increase the need for these companies to interact with consumers and physicians more directly through digital channels. Moreover, the ability to measure and maximize a campaign s ROI in a digital marketing environment has resulted in marketers shifting a greater portion of their advertising spending online and demanding more data-driven analysis of the ROI on their expenditures. Payors, Providers and Employers. The rapidly changing healthcare environment, including the enactment of The Patient Protection and Affordable Care Act, or the Affordable Care Act, increased availability of healthcare data and new reimbursement models, will require payors, providers and employers to increasingly focus their business models around consumer engagement. For example, payors will need to market health insurance products directly to consumers through the recently introduced healthcare exchanges. Likewise, providers will seek to develop long-term relationships with consumers in order to retain them and improve their long-term health. Lastly, employers will need to more directly engage their employees in managing their health in order to lower the employers long-term healthcare costs and improve productivity. We believe that digital strategies, which can be utilized for innovative, efficient and high-impact consumer targeting, acquisition and UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 AMENDMENT NO. 1 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 EVERYDAY HEALTH, INC. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction of incorporation or organization) 7389 (Primary Standard Industrial Classification Code Number) 80-0036062 (I.R.S. Employer Identification No.) 345 Hudson Street, 16th Floor New York, NY 10014 (646) 728-9500 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Benjamin Wolin Chief Executive Officer 345 Hudson Street, 16th Floor New York, NY 10014 (646) 728-9500 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Babak Yaghmaie Stephane Levy Darren DeStefano Cooley LLP 1114 Avenue of the Americas New York, NY 10036-7798 (212) 479-6000 Alan Shapiro Executive Vice President & General Counsel Everyday Health, Inc. 345 Hudson Street, 16th Floor New York, NY 10014 (646) 728-9500 Kirk A. Davenport Latham & Watkins LLP 885 Third Avenue New York, NY 10022-4834 (212) 906-1200 Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company (Do not check if a smaller reporting company) CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount to be Registered(1) Proposed Maximum Aggregate Offering Price Per Share Proposed Maximum Aggregate Offering Price(2) Amount of Registration Fee(3) Common Stock, $0.01 par value per share 8,222,500 shares $15.00 $123,337,500 $15,885.87 (1) Includes an additional 1,072,500 shares that the underwriters have the option to purchase. (2) Estimated solely for the purpose of calculating the amount of the registration fee in accordance with Rule 457(a) under the Securities Act. (3) The Registrant previously paid $14,812 of this amount in connection with the initial filing of this Registration Statement. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. engagement programs, will become a critical tool for these constituencies as they seek to transform their business models to orient around the consumer. The Everyday Health solution We have attracted a large and engaged audience to our premium health and wellness properties and utilize our data and analytics expertise to deliver highly personalized user experiences and efficient and effective marketing and engagement solutions. Benefits to consumers Premier Portfolio of Personalized Content; Multi-Channel Approach. The Everyday Health portfolio includes premier brands and digital properties that provide engaging content, interactive tools and community features that help consumers easily manage their health and wellness on a daily basis. Our content is distributed across multiple channels, including 24 consumer mobile applications that provide a broad array of features, such as customized exercise programs, tailored meal recommendations, video tutorials and tools to track daily performance against goals. We utilize the information provided by our users, as well as predictive modeling, to provide consumers with tailored content, features and tools. Since our inception, over 60 million consumers have voluntarily registered with us, and we have separately developed over 200 million anonymous health consumer profiles that have been used to personalize content for our unregistered consumers. We believe our data-driven approach to delivering a more personalized user experience is a key differentiator between us and our competitors. Benefits to healthcare professionals Premier Content and Tools; Multiple Distribution Channels. We provide premier content that enables healthcare professionals to stay abreast of clinical, industry, legislative and regulatory developments across all major medical specialties. MedPage Today delivers breaking medical news in over 30 specialties, major public policy developments at the state and federal levels and research reported at approximately 100 medical conferences per year around the world. We have designed our content offerings to be utilized by healthcare professionals at the point-of-care and offer two mobile applications, which include drug and reference databases, treatment guidelines and regulatory alerts and announcements. We facilitate access to our high quality news content through various channels, including partnerships with premier medical associations, including the American College of Cardiology, the American Heart Association, the American Academy of Neurology and The Endocrine Society. Benefits to marketers Trusted Platform, Large Audience and Targeted Solutions. The Everyday Health portfolio provides marketers with a trusted platform to promote their offerings, including a suite of customized marketing solutions that utilize our database to target their desired audience. We believe that the overall size, scale and composition of the Everyday Health portfolio, as well as the discrete categories within the portfolio that engage our audience around specific consumer health topics, provide advertisers with significant flexibility to undertake multiple advertising strategies through a single platform, whether focused on a national, regional or local audience or targeting specific interests, issues or user communities. We also utilize our data assets and predictive modeling expertise to design marketing campaigns that retarget our audience beyond the Everyday Health portfolio. We believe a key differentiator of our business is our ability to use our extensive data assets to provide marketers with more significant and measurable ROI relative to offline and other online channels. We provide our marketers with detailed post-campaign reporting that allows them to measure and evaluate the effectiveness of their campaigns. Benefits to payors, providers and employers Innovative Consumer Engagement Platform; Efficient Consumer Acquisition Vehicle. Our personalized content, interactive tools and trackers and community features promote high levels of engagement focused on improving consumers health and managing chronic conditions. We believe payors, providers and employers can utilize our scaled and targeted database of consumers and customized engagement solutions to achieve their health outcome goals, thereby leading to lower overall cost of care, higher employee productivity and greater member and employee satisfaction. For example, in 2013, we partnered with the Mayo Clinic to develop a digital health management platform that provides health assessment tools, lifestyle education, health coaching and wellness information to employers and payors. In addition, we believe payors will view our large and engaged audience as an attractive vehicle for recruiting consumers for their products and services, including health insurance being offered on new public exchanges. Competitive advantages The combination of our large and registered user base, premier health and wellness brands, content and tools, and proprietary data assets and personalization technology, creates a unique health engagement platform that we can monetize to address the varied business needs of constituencies across the health and wellness landscape. Our key competitive advantages include the following: Portfolio Management. Our ability to curate and cross-promote a broad array of premier content across the Everyday Health portfolio has allowed us to aggregate a highly engaged audience of consumers and healthcare professionals through online and mobile channels. Proprietary Data and Analytics Expertise. Our sophisticated data and analytics capabilities allow us to provide a superior user experience with personalized content offerings, optimize advertising performance in real time and provide marketers with targeted solutions for their campaigns. Measurable ROI for Marketers. We have developed a differentiated process to prove ROI for our clients by working closely with third party vendors, such as IMS and Crossix, to independently measure the impact of our programs, including measuring increases in brand awareness and sales. This research allows us to optimize our campaigns and demonstrate a positive ROI for our customers. Strategic Relationships with Brand Advertisers. We have built deep relationships with many leading brand advertisers and advertising agencies that view us as a strategic and trusted partner for complex digital marketing initiatives that target specific population sets with personalized content and messaging. Powerful Network Effects. Our content personalization capabilities and ability to develop sophisticated marketing programs continuously improve as our database expands. This self-reinforcing network effect helps enhance our brand, improves user engagement and attracts new users to our properties. Our growth strategy We intend to utilize our premier content, data assets and large and engaged user base to continue to grow our business. Key elements of our growth strategy include: increasing our advertising and sponsorship revenues and customer base; growing our healthcare professional business; expanding our multi-channel content and data and analytics capabilities; utilizing our existing assets to generate significant revenue from a broader set of healthcare constituencies; enhancing the Everyday Health brand; and acquiring complementary businesses. Risks related to our business Our business is subject to a number of risks which you should consider before making an investment decision. These risks are discussed more fully in the section of this prospectus titled "Risk factors." These risks include, among others: if we are unable to provide content and services that attract users to the Everyday Health portfolio on a consistent basis, our advertising and sponsorship revenues could be reduced; if we are unable to prove that our advertising and sponsorship offerings provide a good ROI for our customers, our financial results could be harmed; failure to maintain and enhance our brands could have a material adverse effect on our business; our ability to deliver personalized content depends on our ability to collect and use data, and any limitations on the collection and use of this data could significantly diminish the value of our solutions; our possession and use of personal information presents risks that could harm our business, and any unauthorized disclosure or manipulation of such data could expose us to costly litigation and damage our reputation; changes in regulations impacting healthcare, data privacy, intellectual property rights or marketing practices could hurt our business and financial results; our history of net losses since inception and expectation that such losses will continue for the foreseeable future; and if we are unable to generate sufficient cash flow from our operations, we may be unable to meet our fixed payment obligations, including required interest and principal payments on our long-term debt. Corporate history and information We were incorporated in Delaware in January 2002 as Agora Media Inc. We changed our name to Waterfront Media Inc. in January 2004. In January 2010, to better align our corporate identity with the Everyday Health brand, we changed our name to Everyday Health, Inc. Our principal executive office is located at 345 Hudson Street, 16th Floor, New York, NY 10014, and our telephone number is (646) 728-9500. Our Internet website address is www.EverydayHealth.com. The information on, or that can be accessed through, any property in the Everyday Health portfolio is not part of this prospectus, and you should not consider any information on, or that can be accessed through, any property in the Everyday Health portfolio as part of this prospectus. The names Everyday Health and MedPage Today and our logos are trademarks, service marks or trade names owned by us. All other trademarks, service marks or trade names appearing in this prospectus are owned by their respective holders. Additionally, we are an emerging growth company as defined in the recently enacted Jumpstart Our Business Startups Act, or the JOBS Act, and therefore, we may take advantage of certain exemptions from various public company reporting requirements, including not being required to have our internal control over financial reporting audited by our independent registered public accounting firm pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and any golden parachute payments. We may take advantage of these exemptions until we are no longer an emerging growth company. In addition, the JOBS Act provides that an emerging growth company can delay adopting new or revised accounting standards until such time as those standards apply to private companies. The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion. Dated March 17, 2014. 7,150,000 shares Common stock This is an initial public offering of shares of common stock of Everyday Health, Inc. Everyday Health is offering 5,360,000 of the shares to be sold in this offering. The selling stockholders identified in this prospectus are offering 1,790,000 shares. Everyday Health will not receive any of the proceeds from the sale of the shares being sold by the selling stockholders. Prior to this offering, there has been no public market for our common stock. It is currently estimated that the initial public offering price per share will be between $13.00 and $15.00. We have applied to list our common stock on the New York Stock Exchange under the symbol EVDY. Mayo Clinic has indicated an interest in purchasing in this offering, at the initial public offering price, up to that number of shares of our common stock having an aggregate value of $10 million. Because this indication of interest is not a binding agreement or commitment to purchase, Mayo Clinic may elect not to purchase shares in this offering. The underwriters will receive the same discounts and commissions from any shares of our common stock purchased by Mayo Clinic as they will from any other shares of our common stock sold to the public in this offering. We are an emerging growth company as defined under the U.S. federal securities laws and, as such, may elect to comply with certain reduced public company reporting requirements for this and future filings. See Risk factors beginning on page 13 to read about factors you should consider before buying shares of our common stock. Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. Per Share Total Initial public offering price $ $ Underwriting discounts and commissions(1) $ $ Proceeds, before expenses, to Everyday Health $ $ Proceeds, before expenses, to the selling stockholders $ $ (1) We refer you to Underwriting on page 149 for additional information regarding underwriting compensation. To the extent that the underwriters sell more than 7,150,000 shares of common stock, the underwriters have the option to purchase up to an additional 1,072,500 shares from Everyday Health at the initial public offering price less the underwriting discount. The underwriters expect to deliver the shares of common stock on or about , 2014. J.P. Morgan Credit Suisse Citigroup Stifel SunTrust Robinson Humphrey Prospectus dated , 2014. The offering Common stock offered by Everyday Health 5,360,000 shares Common stock offered by the selling stockholders 1,790,000 shares Common stock to be outstanding immediately after this offering 29,678,020 shares Use of proceeds We estimate that we will receive net proceeds from this offering of approximately $66.8 million, based on an assumed public offering price of $14.00 per share, the midpoint of the price range set forth on the cover of this prospectus, after deducting the estimated underwriting discounts and commissions and offering expenses payable by us. We intend to use the net proceeds from this offering for working capital and general corporate purposes, including funding capital expenditures and operating losses. We may also use a portion of the net proceeds to repay borrowings under our credit facility or acquire complementary businesses, products or technologies. However, we do not have agreements or commitments for any specific repayments or acquisitions at this time. We will not receive any proceeds from the sale of shares by the selling stockholders in this offering. See section titled Use of proceeds for additional information. Proposed NYSE symbol EVDY Risk factors You should read the Risk factors section beginning on page 13 and other information included in this prospectus for a discussion of factors to consider carefully before deciding to invest in shares of our common stock. The number of shares of common stock that will be outstanding after this offering is based on 24,055,334 shares of common stock outstanding as of March 15, 2014 after giving effect to the assumptions in the following paragraph and includes an additional 262,686 shares of common stock to be issued upon exercise of stock options and warrants by certain of the selling stockholders in connection with the sale of these shares in the offering. The number of shares that will be outstanding after the offering excludes: 6,532,679 shares of common stock issuable upon exercise of outstanding options with a weighted-average exercise price of $9.30 per share; 641,177 shares of common stock issuable upon the exercise of certain outstanding warrants with a weighted-average exercise price of $1.91 per share; and 1,053,742 shares of common stock reserved for future issuance under our equity incentive plans, consisting of (a) 353,742 shares of common stock reserved for issuance under our 2003 Stock Option Plan, (b) 200,000 shares of common stock reserved for issuance under our 2014 Equity Incentive Plan, and (c) 500,000 shares of common stock reserved for issuance under our 2014 Employee Stock Purchase Plan, as well as any automatic increases in the number of shares of common stock reserved for issuance under our 2014 Equity Incentive Plan and our 2014 Employee Stock Purchase Plan. On the date of this prospectus, any remaining shares of common stock available for issuance under our 2003 Stock Option Plan will be added to the shares of common stock reserved under our 2014 Equity Incentive Plan, and no additional grants will be awarded under our 2003 Stock Option Plan. Additional shares may be added to the shares of common stock reserved for issuance under our 2014 Equity Incentive Plan upon the expiration, termination, forfeiture or other reacquisition of shares of common stock issuable upon the exercise of stock options outstanding under our 2003 Stock Option Plan. See Executive compensation Equity incentive plans for additional information. Except as otherwise indicated herein, all information in this prospectus, including the number of shares that will be outstanding after this offering, assumes or gives effect to: a 1-for-1.5 reverse stock split effected on March 14, 2014; the conversion of all outstanding shares of our redeemable convertible preferred stock into an aggregate of 18,457,235 shares of common stock, based on an assumed initial public offering price of $14.00 per share, the midpoint of the price range set forth on the cover page of this prospectus, which will occur automatically upon completion of this offering, which we refer to as the automatic preferred stock conversion; the automatic net exercise of a warrant to purchase 150,000 shares of our common stock at an exercise price of $0.015 per share as described elsewhere in the prospectus in the section titled Description of capital stock Warrants, which we refer to as the automatic warrant exercise; no exercise by the underwriters of their option to purchase up to 1,072,500 additional shares from us; and the adoption of our amended and restated certificate of incorporation and our amended and restated bylaws that will occur upon consummation of this offering. The number of shares of our common stock to be issued upon the automatic conversion of all outstanding shares of our redeemable convertible preferred stock depends in part on the initial public offering price in this offering. The terms of our Series G redeemable convertible preferred stock provide that the ratio at which each share of such series automatically converts into common stock in connection with this offering will increase if the initial public offering price is below $17.82 per share, which would result in additional shares of our common stock being issued upon conversion of our Series G preferred stock. Based upon the assumed initial public offering price of $14.00 per share, the midpoint of the price range set forth on the cover page of this prospectus, the outstanding shares of our Series G preferred stock would convert into an aggregate of 2,692,020 shares of our common stock immediately prior to the closing of this offering. For illustrative purposes only, the table below shows the number of shares of our common stock that would be issuable upon conversion of the Series G preferred stock at various initial public offering prices and the resulting total number of outstanding shares of our common stock expected to be outstanding after this offering: Assumed Public Offering Price ($) Shares of Common Stock Issuable upon Conversion of Series G Preferred Stock Total Shares of Common Stock Outstanding After this Offering $ 12.00 3,140,707 30,126,707 $ 13.00 2,899,105 29,885,105 $ 14.00 2,692,020 29,678,020 $ 15.00 2,512,568 29,498,568 $ 16.00 2,355,527 29,341,527 Until , 2014 (the 25th day after the date of this prospectus), all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.
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+PROSPECTUS SUMMARY This summary highlights selected information from this prospectus but does not contain all information that you should consider before investing in our common stock. You should read this entire prospectus carefully, including the information under Risk Factors beginning on page 8, and the financial statements and related notes included elsewhere in this prospectus, before making an investment decision in our Common Stock. Company Overview Juhl Energy is an established leader in the clean and renewable-energy industry. Juhl Energy historically focused on community wind power development, management and ownership, throughout the United States. We are one of the few companies other than utility based conglomerates that handle all aspects of wind project development, through our operating subsidiaries, including full development and ownership of wind farms, general consultation on wind projects, construction management of wind farm projects and system operations and maintenance for completed wind farms, which results in multiple revenue streams. The primary focus of our wind power development business has been to build 5 MW to 80 MW wind farms jointly owned by local communities, farm owners, environmentally-concerned investors, and our Company. The wind farms are connected to the general utility electric grid to produce clean, environmentally-sound wind power. Our development of community wind power systems generally results in landowners owning a portion of the long-term equity in the wind farm that resides on their land. We pioneered community wind power systems in developing the currently accepted financial, operational and legal structure providing local ownership of medium to large scale wind farms. Since 1999, we have completed 23 wind farm projects, accounting for approximately 240 MW of wind power that currently operate in the Midwest region of the United States, and we provide operation management and oversight to wind generation facilities generating approximately 88 MW, through our subsidiary, Juhl Energy Services. Currently, we have 20 projects in various stages of development with an aggregate wind power generating capacity of approximately 295 MW (5 of which we are actively developing with an aggregate wind power generating capacity of approximately 89 MW and 15 of which are early stage wind development opportunities, which includes projects undergoing feasibility analysis, with an aggregate wind power generating capacity of approximately 206 MW). The 20 wind farm projects, all of which are on-shore type projects, are located in the United States and Canada and make up our development pipeline. One of the unique aspects at Juhl Energy is the diversity and integration of its subsidiaries which make up our business model. The Company operates through the following subsidiaries (with further description set forth below): Juhl Renewable Assets renewable assets ownership Juhl Energy Development wind farm development Juhl Energy Services wind farm management and turbine maintenance services together with cellular communication tower maintenance activities Juhl Renewable Energy Systems small scale renewable systems Next Generation Power Systems refurbished turbines and maintenance support Power Engineers Collaborative engineering services Diversifying Strategy and Execution Juhl Energy s diversification strategy focuses upon the delivery of sustainable revenue growth outside of wind farm development and construction fee revenue. As such, the acquisition of additional energy assets remains a meaningful part of our focus on the growth of our revenue and net income. Further, Juhl Energy s business strategy has allowed us to remain well-positioned for future growth despite the uncertainty surrounding federal policy with respect to tax incentives which have impacted businesses operating in the wind industry. Our business and operating strategy, among other things, is to continue to develop into an innovative, diverse and balanced clean energy company. We will work to leverage our portfolio of existing community wind power projects, develop new wind farm projects, including at industrial plants to help reduce the carbon footprint of manufacturers, and take equity ownership positions in existing community-based wind farms. Further, we are continuing to diversify our business operations by expanding our product offerings to energy conscious consumers with the development of our small scale renewables, including wind turbines and solar products, and more recently, expanding our maintenance services capabilities to include cellular towers. We have also expanded our services offerings to provide engineering services for our clients. We believe that the expansion into engineering consulting services with the acquisition of PEC in 2012 has significantly increased our ability to grow our revenues beyond development and construction of community wind projects into the full range of clean energy projects including natural gas, biomass, waste-to-energy, medium-to-large on-site solar, and support to larger wind farm construction. We have experienced growth in revenues for PEC and expect this to continue, complimented by our experience in wind farm development and construction. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer,'' accelerated filer'' and smaller reporting company'' in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company CALCULATION OF REGISTRATION FEE Title of each class of securities to be registered Proposed maximum aggregate offering price (1) Amount of Registration fee Common Stock, $.0001 par value (2)(3) $3,450,000 $444.36 (4) (1) Pursuant to Rule 416 under the Securities Act of 1933, this registration statement also relates to an indeterminate number of additional shares which may be issuable to prevent dilution resulting from stock dividends, stock splits, recapitalization or other similar transactions effected without the receipt of consideration that results in an increase in the number of the outstanding shares of common stock. (2) Estimated solely for the purpose of computing the amount of registration fee in accordance with Rule 457(o) under the Securities Act of 1933, as amended. (3) Includes shares the underwriter has the option to purchase to cover over-allotments, if any. (4) Previously paid. THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE. With our entry into the U.S. telecommunication industry, through Juhl Tower Services, a wholly-owned subsidiary of Juhl Energy Services (as discussed below), we perform implementation and maintenance activities on cellular communication towers. Juhl Tower Services enters into contracts with the owners of the cellular communication towers that lease antenna space to wireless service companies and radio and television broadcasters. Such contracts are structured whereby Juhl Tower Services is engaged as a subcontractor to maintain equipment on cellular towers for the owners of the cellular towers. Juhl Tower Services provides us the opportunity to utilize our experience of providing maintenance to wind turbines and apply that to cellular communication towers, with the recruitment of crew leaders and operations personnel with substantial experience in servicing cellular equipment. Further, we believe that such entry into the telecommunications industry exemplifies our strategy to diversify our service offerings, allowing us to capitalize on the growth of the telecommunication industry and the resulting demand for infrastructure, including the cellular communication towers, by using our expertise gained from the maintenance of turbines in our core business of wind farm development. To date, we have completed maintenance activities on 231 cell towers, and we are now collecting revenue. Our expectation is that such contracts will lead to a profitable revenue stream in the remaining quarters of 2014. Competitive Advantages/Strengths Our Company is a diversified clean energy company built upon our roots as a pioneer in the wind farm development industry with particular expertise in the community wind sector. We believe that we have a number of competitive advantages in the clean renewable energy sector in addition to our nationally-recognized community wind development: Tiered Service Offering Results in Multiple Revenue Streams. One of our key advantages is that we generate revenue from our operating subsidiaries offering diversified products and services in all segments of the renewable clean energy sector rather than relying solely on one operating subsidiary to produce revenue: Juhl Renewable Assets focuses on the acquisition of ownership positions in wind farms and investment in other renewable energy assets which provide predictable revenues and strong operating margins. Capitalizing on the unique knowledge base of our parent company, Juhl Renewable Assets acquires new and existing wind farms, thus building an asset base with predictable cash flows. Juhl Energy Development is our wind farm development subsidiary, where revenue is generated from development, service and construction fees earned from each of the wind farms that we develop, which revenue is recognized on a completed basis. Juhl Energy Services is our wind farm operations and maintenance subsidiary, where revenue is earned from administrative, management and maintenance services agreements and is recognized as the in-field services are provided. In early 2013, Juhl Energy Services formed a wholly-owned subsidiary, Juhl Tower Services, which enters into agreements to maintain equipment on towers, including wind generating towers and cellular towers. We have completed maintenance activities on 231 cell towers to date and anticipate this will lead to a profitable revenue stream in the remaining quarters of 2014. Juhl Renewable Energy Systems is our small scale renewable subsidiary, where revenue will be contributed through the sale and installation of renewable energy systems, including solar products and small scale wind turbines, to the energy consumer (including agricultural-related businesses and municipalities) which provide modern options in terms of cost effectiveness, performance, and reliability. Power Engineers Collaborative expands our professional capacities beyond wind and into the full range of clean energy sectors including natural gas, biomass, waste-to-energy, medium-to-large on-site solar, and support to larger wind farm construction. Proven Record in Developing Wind Farm Projects. One of our key advantages is that we have completed 23 community wind farm projects to date, representing approximately 240 MW of generating capacity of electricity, and currently have projects in various stages of development, amounting to a total of 295 MW of wind power generating capacity of electricity. We expect that the ability to point to actual projects completed, along with the extensive knowledge base developed and relationships necessary to get the job done, will provide us an edge in securing new projects with owners considering retaining a development company. The significant relationships we have developed include those with utility power purchasers, equity and debt project finance sources, turbine suppliers and contractors. These strengths, we believe, will support continued growth of our nationally-recognized community wind farm development business. The information in this prospectus is not complete and may be changed. A registration statement relating to these securities has been filed with the Securities and Exchange Commission. These securities may not be sold until the registration statement is effective. This prospectus is not an offer to sell these securities and does not solicit an offer to buy these securities in any state or other jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED JULY 29, 2014 JUHL ENERGY, INC. 15,000,000 Shares of Common Stock We are offering 15,000,000 shares of our common stock, par value $.0001 per share, which we refer to in this prospectus as the Common Stock or the Shares . Our Common Stock is currently quoted on the OTC Bulletin Board under the symbol JUHL . The closing price of our Common Stock on the OTC Bulletin Board on July 24, 2014 was $0.28 per share. We currently expect the public offering price to be between $0.16 and $0.20 per share. The public offering price of the Common Stock offered by this prospectus will be determined by negotiation between management and the underwriter, in consideration of market conditions and other prevailing factors on the day we price the Shares covered by this prospectus. The offering price may not reflect the price at which the Common Stock trades. The trading price is subject to change as a result of market conditions and other factors, and we cannot assure you that the Shares can be resold at or above the public offering price. Investing in our Common Stock involves a high degree of risk. See Risk Factors beginning on page 8 of this prospectus for a discussion of information that should be considered in connection with an investment in our securities. Investment in our Common Stock involves a high degree of risk and you should purchase Shares only if you can afford a complete loss of your investment. Per Share Total Public offering price $ $ Underwriting discounts and commissions (1) $ $ Proceeds, before expenses, to us (2) $ $ (1) The underwriter will receive compensation in addition to the underwriting discount, including warrants to purchase 5.0% of the shares of Common Stock sold in this offering with a per share exercise price equal to 115% of the public offering price of the Common Stock sold in this offering, reimbursement of its out-of-pocket expenses (including fees and expenses of counsel) in connection with this offering in an amount not to exceed $125,000, and a right of first refusal to serve as our exclusive placement agent, lead managing underwriter or exclusive financial advisor in connection with future transactions we undertake within the one year period following the effective date of this offering if this offering is completed. See the heading entitled Underwriting on page 90 of this prospectus for disclosure regarding compensation to the underwriter payable by us. (2) We estimate that the total expenses of this offering, exclusive of the underwriters discount, will be approximately $265,948. This amount includes estimated expenses we have agreed to reimburse the underwriter. We have granted to the underwriter an option to purchase up to 2,250,000 additional shares of our common stock to cover over-allotments, if any, within 30 days of the date of this prospectus. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. The underwriter expects to deliver our shares to purchasers in the offering on or about , 2014. Northland Capital Markets The date of this prospectus is , 2014. Experienced Management Team. Led by an industry leader, Dan Juhl, we believe our development team is highly qualified in its experience, credibility and track record. Mr. Juhl is an expert in the wind power field and is considered a pioneer in the wind industry having been active in this field since 1978. He was a leader in the passage of specific legislation supporting wind power development in the states of Minnesota and Nebraska, as well as contributing to the development of the currently accepted, financial, operational and legal structure providing local ownership of medium-to-large scale wind farms. John Mitola, our President, is also considered an expert in the energy field having focused his career on energy efficiency, demand side management and independent power development. He has significant experience in the energy industry and electric industry regulation, oversight and government policy. The rest of our management team has collectively been involved in the wind power industry for more than 30 years. We believe that our experience in developing community wind farms in new market areas and operating energy companies will enable us to continue to successfully expand our development portfolio. Further, we believe our management s understanding of deregulated energy markets enables us to maximize the value of our development portfolio. Our team has experience in site selection, market analysis, land acquisition, community relations, permitting, financing, regulation and construction. As we build on our diverse renewable energy business through strategic acquisitions or joint ventures with other industry partners on specific renewable energy projects, our experienced management team s position in the industry will be elevated which will enhance our ability to secure projects that meet our criteria and move forward on those renewable energy projects. Established Local Presence and Credibility. In the Midwest U.S. markets where we are active, our management team maintains a local presence and promotes community stakeholder involvement. By maintaining our principal office in Pipestone, Minnesota and satellite offices in Minneapolis, Minnesota and Chicago, Illinois, and becoming involved in local community affairs, we develop a meaningful local presence, which we believe provides us with a significant advantage when working through the local permitting processes and helps to enlist the support of our local communities for wind farms. We believe that our local approach has enabled us to secure approvals and support for our projects in regions that have historically voiced opposition and has given us a significant advantage over competitors, who are not as active in the local communities in which we are developing wind farms. Our management s active participation in the state and local regulatory and legislative processes has led to the growth of community wind across the Midwest. We plan to use the credibility that has been built in the local communities to expand our presence outside of the Midwest U.S. market, where we can take advantage of higher electricity rates. Currently, we are developing a project in upstate New York to capitalize on higher electricity rates. At the end of 2012, we formed a joint venture with Boulder, Colorado-based 8030 Companies to focus on the acquisition of existing wind farms and other clean energy assets across the United States and Canada. This allows us to leverage the credibility that we have acquired in the community wind farm industry to expand our reach beyond the Midwest market and leverage our experience to augment operating assets and projects. Strategic Acquisition Subsidiary Juhl Renewable Assets. Juhl Renewable Assets is our vehicle for strategic acquisitions to supplement our wind energy business and take advantage of the growth occurring in the community wind industry. Our strategic acquisition plan actively focuses on the following: (i) acquisition of additional wind service businesses, including other operation and maintenance providers and wind consulting providers; (ii) acquisition of ownership of existing wind farms that fit our distributed generation model and the size projects we typically develop; and (iii) acquisition or joint venture relationships with other industry partners on specific projects, where we can share the various elements of fees and profits including development fees, general construction, management, and operations and maintenance. Such an acquisition strategy results in acquiring assets that provide a residual, repeatable annual revenue stream. Our focus is to take advantage of opportunities in regions with higher energy rates. Currently, we own or have an interest in the following operating wind farms: (i) Valley View Wind Farm (10 MW); (ii) Woodstock Hills Wind Farm (10.2 MW), and (iii) Winona Wind Farm (1.5 MW), all of which are located in Minnesota. In addition to these positions in our current operating wind farms, Juhl Renewable Assets has reached a definitive agreement to acquire two wind farm projects, consisting of 3.2 MW, in Iowa. Those projects are under common ownership. The closing is subject to consent by the existing lenders, or the Company obtaining an alternative debt financing arrangement. TABLE OF CONTENTS Special Note Regarding Forward-Looking Statements and Industry Data 1 Definitions 2 Prospectus Summary 3
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+S-1/A 1 body-resalesx192414sx1aame.htm S-1/A Body-ResaleS-192414 S-1 / A Amendment As filed with the Securities and Exchange Commission on November 19, 2014 Registration No. 333-198924 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Pre-Effective Amendment No. 1 to Form S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Body Central Corp. (Exact Name of Registrant as Specified in its Charter) Delaware 5600 14-1972231 (State or other jurisdiction of incorporation or organization) Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification No.) 6225 Powers Avenue Jacksonville, Florida 32217 Telephone: (904) 737-0811 (Address, including zip code, and telephone number, including area code, of principal executive offices) Ben Rosenfeld President and Chief Executive Officer Body Central Corp. 6225 Powers Avenue Jacksonville, Florida 32217 Telephone: (904) 737-0811 (Address, including zip code, and telephone number, including area code, of agent for service) Copies to: Scott H. Moss, Esq. Alan Wovsaniker, Esq. Lloyd Jeglikowski, Esq. Lowenstein Sandler LLP 65 Livingston Avenue Roseland, New Jersey 07068 Telephone: (973) 597-2500 Approximate date of proposed sale to public: From time to time after this registration statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. x If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of large accelerated filer, accelerated filer, and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer Accelerated filer x Non-accelerated filer Smaller reporting company (Do not check if a smaller reporting company) CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to Be Registered Amount to Be Registered Proposed Maximum Offering Price per Share Proposed Maximum Aggregate Offering Price Amount of Registration Fee Common Stock, par value $0.001 per share, underlying subordinated secured convertible notes sold to selling stockholders in private placement 5,968,080(1) $ 1.43(2) $ 8,534,354.40(2) $ 991.69(3) (1) Amount of shares of the registrant s common stock, par value $0.001 per share, to be registered and offered and sold by the selling stockholders. Represents (i) 5,142,864 shares of the registrant s common stock issuable upon conversion of the $18 million initial aggregate principal amount of subordinated secured convertible notes issued by the registrant to the selling stockholders in a private placement on June 27, 2014 (the convertible notes ) plus (ii) an additional 825,216 shares of the registrant s common stock issuable correlating to two years of capitalized interest on the convertible notes, based on the registrant s good faith estimate that capitalized interest will be added to the outstanding principal amount of the convertible notes on a quarterly basis at a rate of 7.5% per annum for approximately the first two years of the three-year term of the convertible notes. The convertible notes have a fixed conversion price initially set at $3.50 per share, subject to adjustment for stock splits, combinations or similar events and subsequent dilutive issuances during the term of the convertible notes. In accordance with Rule 416 under the Securities Act of 1933, as amended (the Securities Act ), this registration statement also covers such indeterminate number of additional securities as may become issuable to prevent dilution resulting from stock splits, stock dividends or similar transactions. (2) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(c) under the Securities Act, based on the average of the high and low reported sale prices of the registrant s common stock as traded on the OTC Pink marketplace on November 12, 2014. (3) The registrant previously paid a registration fee of $2,196 upon the initial filing of this registration statement on September 24, 2014. No additional fee is payable with the filing of this Amendment No. 1. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act, as amended, or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to such Section 8(a), may determine. The information in this prospectus is not complete and may be changed. The selling stockholders identified in this prospectus may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Preliminary Prospectus Subject to Completion, dated November 18, 2014 5,968,080 Shares Body Central Corp. Common Stock The selling stockholders named in this prospectus may offer and sell from time to time up to 5,968,080 shares of our common stock covered by this prospectus. The shares of common stock offered by the selling stockholders represent (i) 5,142,864 shares of our common stock issuable upon conversion of the $18 million initial aggregate principal amount of subordinated secured convertible notes (which we sometimes refer to herein as the convertible notes ) issued by us to the selling stockholders in a private placement on June 27, 2014, plus (ii) an additional 825,216 shares of our common stock issuable correlating to two years of capitalized interest on the convertible notes, based on our good faith estimate that capitalized interest will be added to the outstanding principal amount of the convertible notes on a quarterly basis at a rate of 7.5% per annum for approximately the first two years of the three-year term of the convertible notes (with capitalized interest for one calendar quarter having been added to the principal balance of the convertible notes to date). The convertible notes have a fixed conversion price initially set at $3.50 per share, subject to adjustment for stock splits, combinations or similar events and subsequent dilutive issuances during the term of the convertible notes. Information about the selling stockholders is set forth in the section entitled Selling Stockholders beginning on page 46 of this prospectus. We are not selling any shares of our common stock under this prospectus and we will not receive any proceeds from the sale of our common stock by the selling stockholders. We will bear all expenses of registration incurred in connection with this offering, except any underwriting discounts and commissions and certain other expenses incurred by the selling stockholders in disposing of their shares. Following the effectiveness of the registration statement of which this prospectus forms a part, the selling stockholders identified in this prospectus, or their respective pledgees, donees, transferees or other successors in interest, may offer and sell the shares of common stock being offered by this prospectus from time to time in public or private transactions, or both. The sale and distribution of the common stock offered hereby may be effected in one or more transactions that may take place on the OTC Pink marketplace, including ordinary brokers transactions, privately negotiated transactions or through sales to one or more dealers for resale of such securities as principals, at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices. Usual and customary or specifically negotiated brokerage fees or commissions may be paid by the selling stockholders. See Plan of Distribution beginning on page 49 for a more complete description of the ways in which the shares being offered by this prospectus may be sold. The selling stockholders and intermediaries through whom such securities are sold may be deemed underwriters within the meaning of the Securities Act of 1933, as amended, with respect to the securities offered hereby, and any profits realized or commissions received may be deemed underwriting compensation. Our common stock is presently quoted on the OTC Pink marketplace. On November 17, 2014, the last reported sale price of our common stock on the OTC Pink marketplace was $2.35 per share. Unless otherwise expressly stated to the contrary, all share numbers and per share prices in this prospectus have been adjusted to give effect to the one-for-ten reverse stock split of our common stock which we implemented on September 4, 2014, and which became effective for trading purposes on September 9, 2014. Investing in our common stock is highly speculative and involves a significant degree of risk. See Risk Factors beginning on page 15 of this prospectus for a discussion of information that should be considered before making a decision to purchase our common stock. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is November _, 2014. TABLE OF CONTENTS Page PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001394170_sungard_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001394170_sungard_prospectus_summary.txt
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001400728_well_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001400728_well_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this Prospectus. This summary does not contain all the information that you should consider before investing in the common stock of Well Power, Inc. (referred to herein as the "Company," "we," "our," and "us"). You should carefully read the entire Prospectus, including "Risk Factors," "Management s Discussion and Analysis of Financial Condition and Results of Operations" and the accompanying financial statements and notes before making an investment decision. Business Overview Well Power, Inc. was incorporated on March 26, 2007 under the name of "Vortec Electronics, Inc." On December 10, 2013, we filed Articles of Merger with the Secretary of State of Nevada in order to effectuate a merger with our wholly-owned subsidiary, Well Power, Inc. (the "Merger") whose shareholder approval was not required pursuant to Section 92A.180 of the Nevada Revised Statutes. As part of the merger, our board of directors ("the Board") authorized a change in our name to "Well Power, Inc." and our Articles of Incorporation were amended to reflect this name change accordingly. Our ticker symbol subsequently changed from "VOELD" to "WPWR" to resemble our new name. Since the Merger, we have acquired an exclusive license from ME Resource Corporation ("MEC"), a Canadian publicly listed company for which a director and the Chief Technology Officer is related to our President Dan Patience. MEC is creating mobile and scalable Wellhead Micro-Refinery Units ("MRUs") deployable close to the wellhead to process raw natural gas into liquid fuels and clean power. As a result of the license with MEC, we are now in the business of distributing MRUs in the State of Texas and from there into other geographical areas. The product is still under development, which is ongoing, and the first MRU is expected to occur within a year. Discussions are ongoing to raise capital to begin construction of a commercial unit. There is no assurance that we will be able to raise the capital needed to develop the first MRU. Our expectation is that we will obtain financing, chose a site for the MRU, and begin construction of the unit in the third quarter. As such, we will not be able to realize any revenue from the sale of MRUs until the development has completed and a commercialized product is ready for launch. Our plan is to assist the development of the MRUs and distribute them in our licensed territory. We hope to provide oil and gas producers and operators in the State of Texas a solution to process otherwise wasted natural gas, including stranded, shut-in, flared and vented gas and produce valued end-products including engineered fuel (diesel, diluents, synthetic crude) and electrical power. The MRU is a novel method and apparatus, for producing chemicals, heat, energy and water from a methane-containing gas. The innovative method and apparatus makes use of heterogeneous catalysis in a single-vessel, beginning with the partial oxidation of methane to produce synthesis gas followed by a Fischer-Tropsch reaction to produce chemicals and other end products with no excess hydrogen. Under our license agreement, we agreed to pay MEC $400,000 for our exclusive license; the money will go toward the unit cost of an MRU at $800,000 or, alternatively, a revenue sharing arrangement where MEC leases the MRU at 50% unit cost and shares in 50% of the net revenue generated. In either event, this money will be applied to the technical and engineering development of the first demonstration MRU in the territory and may be used to develop catalyst for specific engineered fuels. The payment to MEC was due in two installments: i) $100,000 within thirty (30) days of January 29, 2014; and ii) balance of $300,000 within ninety (90) days of January 29, 2014. We have made total cash payments of $379,000 subsequent to the quarter ended July 31, 2014. Equity Purchase Agreement with Premier Venture On August 26, 2013, we entered into the Equity Purchase Agreement with Premier Venture, a California liability company. Pursuant to the terms of the Equity Purchase Agreement, Premier Venture committed to purchase up to $10,000,000 of our Common Stock during the Open Period. From time to time during the Open Period, we may deliver a drawdown notice to Premier Venture which states the dollar amount that we intend to sell to Premier Venture on a date specified in the put notice (the "Put Notice"). The maximum investment amount per notice shall not exceed the lesser of (i) 200% of the average daily trading volume of Company s common stock on the five trading days prior to the day the Put Notice is received by Premier Venture and (ii) 110% of any previous put amount during the maximum thirty-six (36) month period (or for the first Put Notice, 2,000,000 shares). The total purchase price to be paid, in connection to the Put Notice, by Premier Venture shall be calculated at a thirty percent (30%) discount to the lowest individual daily volume weighted average price of the Common Stock during such trading day ("VWAP") of during the five (5) consecutive trading days immediately after the applicable Put notice date, notwithstanding certain provisions pursuant to the Equity Purchase Agreement, less six hundred dollars ($600.00). We have more shares reserved than are covered in this registration statement. In consideration for the execution and delivery of the Equity Purchase Agreement by Premier Venture, we issued Premier Venture 3,955,070 shares of Company s Common Stock (the "Initial Commitment Shares"), at a purchase price equal to 30% discount to the lowest total share price based on the daily VWAPs of the Common Stock on the three (3) trading days immediately preceding the execution date the Equity Purchase Agreement. Table of Contents In connection with the Equity Purchase Agreement, we also entered into a registration rights agreement (the "Registration Rights Agreement") with Premier Venture, pursuant to which we are obligated to file a registration statement with the SEC. We are obligated to use all commercially reasonable efforts to maintain an effective registration statement until termination of the Equity Purchase Agreement. The 14,370,000 shares to be registered herein represent 12.85% of the shares issued and outstanding, assuming that the selling stockholder will sell all of the shares offered for sale. At an assumed purchase price of $0.0371 (representing 70% of the closing price of our Common Stock of $0.053 on November 21, 2014), we will be able to receive up to $533,127 in gross proceeds, assuming the sale of the entire 14,370,000 shares being registered hereunder pursuant to the Equity Purchase Agreement. Accordingly, we would be required to register an additional 255,171,779 shares to obtain the balance of $9,466,873 under the Equity Purchase Agreement. We are currently authorized to issue 4,500,000,000 shares of our common stock. Premier Venture has agreed to refrain from holding an amount of shares which would result in Premier Venture owning more than 4.99% of the then-outstanding shares of our common stock at any one time. There are substantial risks to investors as a result of the issuance of shares of our Common Stock under the Equity Purchase Agreement. These risks include dilution of stockholders percentage ownership, significant decline in our stock price and our inability to draw sufficient funds when needed. Premier Venture will periodically purchase our Common Stock under the Equity Purchase Agreement and will, in turn, sell such shares to investors in the market at the market price. This may cause our stock price to decline, which will require us to issue increasing numbers of common shares to Premier Venture to raise the same amount of funds, as our stock price declines. The aggregate investment amount of $10,000,000 was determined based on numerous factors, including the following: Current financial operating needs Financing of workover projects Acquisition of assets, business and/or operations Acquisition of additional licensing Ot1her purposes that the Board in its good faith deem in the best interest of the Company Where You Can Find Us Our mailing address is 11111 Katy Freeway, Suite # 910, Houston, TX 77079, and our telephone number is (713) 973-5738. THE OFFERING
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001401708_ns-wind_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001401708_ns-wind_prospectus_summary.txt
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001422109_blue_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001422109_blue_prospectus_summary.txt
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that may be important to you. You should read this entire prospectus carefully, including the sections entitled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations and our historical financial statements and related notes included elsewhere in this prospectus. In this prospectus, unless otherwise noted, the terms the Company, we, us, and our refer to Blue Earth, Inc., and its subsidiaries, Blue Earth Tech, Inc., Blue Earth Energy Management Services, Inc, Blue Earth Energy Management, Inc., Castrovilla, Inc., Xnergy, Inc., Blue Earth Finance, Inc., Blue Earth Energy Partners, LLC, Ecolegacy Gas & Power, LLC, IPS Power Engineering, Inc., Intelligent Power Inc., Millennium Power Solutions, LLC, Blue Earth Capital, Inc., as well as Genesis Fluid Solutions Holdings, Inc., our former name. Overview The Company Blue Earth, Inc. and subsidiaries (the Company ) is a comprehensive provider of energy efficiency and alternative/renewable energy solutions for small and medium sized commercial and industrial facilities. The Company also owns, manages and operates independent power generation systems constructed in conjunction with these services. The Company built and owned a 500,000 watt solar powered facility on the Island of Oahu, Hawaii, which it has contracted to sell (see below) and has also built, operates and manages seven solar powered facilities in California and is designing and permitting numerous other projects. Our turnkey energy solutions enable our customers to reduce or stabilize their energy related expenditures and lessen the impact of their energy use on the environment. Our services offered include the development, engineering, construction, operation and maintenance and in some cases, financing of small and medium scale alternative/renewable energy power plants including solar photovoltaic (PV), combined heat and power ( CHP ) or on-site cogeneration and fuel cells. Although the Company has a limited operating history and limited revenues in comparison to the size of the projects it has undertaken, as a result of the Company s acquisitions, it is fully staffed with experienced personnel who have previously built many larger complex power plants. As discussed below under Corporate Strategy - CHP or Cogeneration our first CHP power plant is expected to be completed in August 2014 with power revenues commencing soon thereafter. We will build, own, operate and/or sell the power plants or build them for the customer to own. As we continue to expand our core energy services business as an independent power producer we intend to sell the electricity, hot water, heat and cooling generated by the power plants that we own under long-term power purchase agreements to utilities, and long-term take or pay contracts to our industrial customers. The Company also finances alternative and renewable energy projects through industry relationships. We provide our customers with a variety of measures to improve the efficiency of their facilities energy consumption by designing, developing, engineering, installing, operating, maintaining and monitoring their major building systems, including refrigeration, lighting and heating, ventilation and air-conditioning. We offer our utility customers, energy efficiency programs, such as our proprietary Keep Your Cool refrigeration program, adopted by 19 utilities, targeted to their small and medium-sized commercial customers. Our utility based, rate- payer incentive programs, are designed to help commercial businesses use less energy through the upgrade of existing equipment with new, more efficient equipment that helps reduce demand for electricity, lower energy bills and also enable utilities to satisfy state-mandated energy reduction goals. In addition to designing and administering the utility program, we perform the technical audits, sell the program to the commercial customer and in most instances, provide the installation of the equipment. We have continued to expand our comprehensive energy solutions business through strategic acquisitions of companies that have been providing energy solutions to an established customer base or have developed a proprietary technology that can be utilized by our customers to improve equipment reliability, reduce maintenance costs and provide a better overall operating environment. The acquired companies operational activities are being conducted through the following five business units: Blue Earth Solar; Blue Earth CHP; Blue Earth EMS; Blue Earth PPS and Blue Earth EPS. The primary strategic objective for the respective business units is to establish and build brand awareness about the comprehensive energy solutions provided by the Company to its existing and future customers. Each of the Company s five business units is generating revenue, although Blue Earth PPS and Blue Earth CHP have limited revenues, as described below. Proprietary technologies owned by the Company are the PeakPower System (PPS) and the UPStealth System. The PeakPower System is a patented demand response, cloud based technology, that allows remote, wireless monitoring of refrigeration units, lighting and heating, ventilation and air conditioning in thousands of facilities such as super markets and food processing, restaurants and C-stores, drug and discount stores. Blue Earth EPS currently has several energy management systems operational in grocery stores. Revenues are expected to ramp up in 2014, as the Company is making some system changes before a major commercial roll out in 2014. The technology enables the Company s business unit, Blue Earth PPS, to provide energy monitoring and control solutions with real-time decision support to protect our customers assets by preventing costly equipment failures and food product losses. Our PeakPower System also serves as a platform to enter into long-term services agreements that allow most types of refrigeration equipment failures to be predicted, thereby enabling preventive servicing based on need rather than periodic, scheduled and costly service calls. The primary purpose for the acquisition of Intelligent Power on July 24, 2013 was to acquire the patent and other intellectual property rights to the above described energy saving technology. As a result of this acquisition, approximately 4.8% of the Company s total assets at December 31, 2013 were represented by the $4,147,832 of intangible assets acquired in this acquisition. During the year ended December 31, 2013, the Company recognized $-0- of revenues from the acquisition of Intelligent Power. The patent pending UPStealth energy power solution (EPS) Management believes, based on its knowledge of the industry, is the only energy efficient, intelligent digital battery backup management system that was designed to power signalized intersections during loss of utility power. This system has been tested, approved and installed in several cities and municipalities throughout the United States. UPStealth is designed as an alternative to lead-acid battery backup systems, enabling the Company s business unit, Blue Earth EPS, to provide its customers with an environmentally friendly product that is completely recyclable with no issues of hazardous out-gassing, corrosion, flammable or explosive characteristics. The UPStealth battery backup management system can be formed in various configurations that allow the intelligent battery to bend around corners and fit into spaces that cannot be accessed by traditional battery backup systems. Compared to lead-acid battery backup systems, our innovative UPStealth energy power solution s cost of ownership is less, requires less maintenance, performs several years longer, and eliminates costly hazardous disposal issues. We also offer a finance program, which allows cities and municipalities to replace existing systems without capital expenditures. As a result of the Company s acquisition of Millennium Power Solutions on August 23, 2013, the above described system represented approximately 11.6% ($10,039,872) of the Company s total assets at December 31, 2013. The Company recognized revenues of $107,253, and a net loss of $236,014 for the year ended December 31, 2013 from the operations of Millennium Power Solutions. There are several other market verticals where we believe both our proprietary technologies can be applied, separately, or in combination, as a viable, cost effective solution. Examples include: services for data centers, oil and natural gas wells, remote cell towers, risk management services, and demand response systems to decrease energy usage during peak load pricing periods charged by utilities. Corporate Strategy Our strategic objective is to provide our customers with turnkey energy solutions and help them identify and maintain low cost or even no cost savings opportunities to reduce or stabilize their energy related expenditures and lessen the impact of their energy use on the environment. Key components to our corporate strategy include the following: Our primary focus in the near term is expected to be organic growth within our combined heat and power (CHP), solar engineering, procurement, and construction (EPC), energy efficiency (EE)/technology business units; although we continue to evaluate and consider strategic acquisition opportunities. Our organic growth focus in each of these areas is summarized as follows. 1) CHP or Cogeneration: Our business model is to construct and own, on a customer s site under a long term lease, CHP or cogeneration systems, selling the thermal power to the customer and the electricity to the customer and the utility grid under long term power purchase agreements (PPAs). We have targeted large companies within the food-processing sector. To date, the Company has signed a letter of intent with a large U.S. and international protein provider to design, build and operate seven (7) CHP plants. We have invested significant revenues into the feasibility and permitting of these projects, have designed and ordered equipment for these projects and are negotiating and finalizing the various operating contracts. We have continued to negotiate these operating contracts while all of the foregoing work has been carried out and expect to enter into the initial contracts in the near term. The PPA agreements with our customers will be on a take or pay basis at a guaranteed discount rate from what they currently pay to their local utility providers. To date, Blue Earth CHP has received limited revenue from engineering work done for a large food processor. Revenues from the sale of electricity generated, which is the foundation of this business unit, are expected to commence in the third quarter of 2014, when the first power plant is scheduled to be completed. The Company raised adequate equity to build this first power plant through its $12 million warrant exercise in November 2013. In December 2013, the Company ordered generators, costing approximately $6.1 million for two power plants for which the total cost is expected to be approximately $17 million. The Company is making the equipment installment payments and construction costs from cash on hand, while selecting among several project debt financing options. The Company will install, own and operate the systems at two food-processing facilities selling thermal and electric power to the customer and the local utility under 20 year power purchase agreements, none of which have been signed. The units are modular, so construction is primarily assembly that is expected to be completed with power revenues commencing in or about August of 2014. In March 2014, the Company ordered generators costing approximately $17.6 million for three power plants, for which the total cost is expected to be approximately $67 million. These facilities are expected to be operational in the fourth quarter of 2014. In the event that the Company is unable to reach a definitive agreement with the intended customer or the customer is otherwise unable to commence commercial operations, the CHP equipment purchased is generic to virtually all CHP projects; the design work is usable for other potential customers and only a small amount of expenditures is site specific and would be written off. Although these are the Company s first CHP power plants, Blue Earth team members have extensive experience building many, larger, more complex CHP power plants with prior employers. The Company also employs large engineering companies for selected engineering and procurement activities as budgeted and planned. The purpose of the Company s acquisition of IPS Engineering Inc. (IPS) and Global Renewable Energy Group Inc.(GREG) was to acquire the plans and development of the above described CHP projects. As a result of this acquisition, the percentage of the Company s total assets represented by construction in progress assets of $44,029,229 at December 31, 2013, was approximately 51%. The Company recognized revenues of $11,444 and a net loss of $319,931 for the year ended December 31, 2013 from IPS and GREG. 2) Solar EPC: Our strategy is to joint venture with under-financed solar developers in order to gain EPC gross margins that exceed the 8-12% common within the industry. The Company is currently constructing 27 solar projects in Hawaii, has recently constructed seven (7) solar projects in California, and is designing and permitting numerous other projects. Our joint venture agreement with NGP and Talesun contractually commits them to use the Company exclusively as an EPC for over 150 MW of solar project construction.Under the terms of the joint venture agreement, the Company invested $2.0 million in cash. The Company had a commitment to lend up to $6,500,000, as orally extended to March 31, 2014, which expired, however the parties are negotiating a possible extension of the commitment, the terms of which note are being renegotiated. The 150 MW of committed projects represent approximately a $300 million pipeline (as defined herein) of solar work as provided in the joint-venture Agreement first announced in September 2013 with a contracted 20% gross margin on a cost plus basis. It is possible that the Company may reduce the gross margin in some select cases to accelerate conversion of pipeline to backlog, as defined below. Projects that have not yet been funded are considered to be pipeline. It is only when project financing is arranged that projects are moved from pipeline to backlog. The Company has not generated any revenues, to date, from this joint venture. Historically, the Company s pipeline for acquisition was large and generally not realized for various reasons, including site control, permitting, engineering, interconnect, and an inability to obtain project financing. Specifically, the $585 million pipeline announced in September 2011 in connection with the Company s acquisition of Xnergy, Inc. included in excess of 60 projects, which were not converted into significant revenues for all of the different reasons as described above and no longer exists. However, the Company s new solar management team has significant experience in converting pipeline into backlog and completing projects and is focused on converting the current $300 million pipeline originating from the joint-venture projects and other projects under development by the Company into revenues. From the September 26, 2011 acquisition of Xnergy through December 31, 2013, the Company recognized total revenues of $12,731,559 from Xnergy. 3) EE/Technology: Our historical EE business has focused on installing lighting, refrigeration and HVAC equipment for our customers which, based on Management s knowledge of the industry, we believe can reduce our customer s costs by 25-60%. We based our projected savings on our having provided energy efficiency services to approximately 11,000 small to medium sized commercial customers. The Company has verified these savings through its monitoring of customer electricity bills and by using energy monitoring equipment that measures energy consumption between the old equipment and the new more effective energy efficient equipment. We anticipate cross-selling to our larger CHP food processor customers. Our two recent technology acquisitions provide us proprietary intelligent battery technology and low cost, cloud based energy management systems that Management expects will give us a competitive edge with our commercial customers. The technology will be added to our proprietary Keep Your Cool utility program that has been accepted by 20 West Coast utilities, which is expected to facilitate the roll out of our utility program across the United States. Expand Scope of Product and Service Offerings. We plan to continue to expand our offerings by including new types of energy efficiency services, products and improvements to existing products based on technological advances in energy savings strategies, equipment and materials. Through the acquisitions of Intelligent Power Inc. and Millennium Power Solutions, LLC we significantly expanded our offerings of proprietary energy management and energy power solutions, which have enhanced our capabilities to offer our customers comprehensive energy savings solutions. Meet Market Demand for Cost-Effective, Environmentally-Friendly Solutions. Through our energy efficiency measures and products, we enable customers to conserve energy and reduce emissions of carbon dioxide and other pollutants. We plan to continue to focus on providing sustainable energy solutions that will address the growing demand for products and services that create environmental benefits for customers. Increase Recurring Revenue. We intend to continue to seek opportunities to increase our sources of recurring revenue as we continue to expand our core energy services business to become an independent power producer, or IPP, by selling the electricity, hot water, heat and cooling generated by on-site power plants that we build and own under long term power purchase agreements, or PPA s. Utility Programs. We intend to offer utilities energy efficiency programs such as our Keep Your Cool refrigeration program and broaden our utility program offerings to their small and medium-sized commercial and industrial customers. Strategic Acquisitions. We will continue to identify and acquire energy management companies and technologies that will enable us to expand our capabilities in our alternative/renewable energy and energy efficiency products and services offerings. The Company has recognized revenues of $10,305,736, $8,466,965 and $4,914,118 for years ended December 31, 2013, 2012 and 2011, respectively, with net losses of $(25,277,153), $(9,640,578) and $(14,000,348), respectively. As of December 31, 2013, the Company had an accumulated deficit of $(62,727,793). Our executive offices are located at 2298 Horizon Ridge Parkway, Suite 205, Henderson, NV 89052. Our telephone number is (702) 263-1808. Recent Developments For the three months ended March 31, 2014, the Company expects to report unaudited revenues of $3,234,217, as compared to $2,163,330 in revenues for the three months ended March 31, 2013, with a net loss of $5,686,460 for the three months ended March 31, 2014, as compared with a net loss of $1,877,417 for the three months ended March 31, 2013. Excluding the non-cash expenses of common stock for services, amortization of intangible assets acquired for stock and stock options/warrants issued for services which total $2,904,380 and $630,192 for the 2014 and 2013 periods, respectively, the loss would have been $2,782,080 and $1,247,217, respectively. On June 30, 2013, the last day of the Company s second fiscal quarter, the market value of the common equity held by non-affiliates was only $60,194,697, and the Company was not required to file as an accelerated filer and was not subject to the filing requirements of an accelerated filer. However, the Company voluntarily filed as an accelerated filer, as it subsequently met the requirements. The Company has amended the registration statement of which this prospectus is a part to reflect the fact that it is still a smaller reporting company. The Offering Securities Offered Hereby This prospectus relates to the sale by certain selling stockholders of up to 33,311,015 shares of our common stock, as described on the cover page of this Prospectus. Offering price Market price or privately negotiated prices. Common stock Outstanding 63,951,292 shares, $.001 par value(1) Warrants Outstanding 26,289,418 (2) Options Outstanding 2,486,239 Common Stock Fully Diluted 97,889,029shares after: the exercise of all outstanding Warrants (26,289,418 shares), Options (2,486,239 shares) and conversion of 460,900 shares of Preferred Stock plus accrued dividends (5,162,080 shares). Use of proceeds We will not receive any proceeds from the sale of the common stock by the selling stockholders. However, we will receive the exercise price, upon exercise of all Warrants. We expect to use the proceeds received from the exercise of the warrants, if any, for general working capital purposes. OTC QB Symbol BBLU Risk Factors You should carefully consider the information set forth in this prospectus and, in particular, the specific factors set forth in the Risk Factors section beginning on page 9 of this prospectus before deciding whether or not to invest in our common stock. ______________ (1) Represents the number of shares of our common stock outstanding as of May 7, 2014. (2) As of May 7, 2014, includes: (i) 4,517,500 Class A Warrants and 4,029,154 Class B Warrants outstanding; (ii) 151,931 placement agent warrants outstanding for all prior offerings and (iii) 17,533,333 Warrants issued to Management, Directors and Consultants. Summary Financial Information The summary financial information set forth below is derived from the more detailed audited and unaudited financial statements of the Company appearing elsewhere in this prospectus. This information should be read in conjunction with such financial statements, including the notes to such financial statements. Statement of Operations Data: Years Ended December 31, 2013 2012 2011 2010 2009 Revenue $10,305,736 $8,466,965 $4,914,118 $ - $ - Cost of Sales 7,166,464 5,609,836 2,559,545 - - Gross profit 3,139,272 2,857,129 2,354,573 - - Total Operating Expenses 28,497,962 14,167,889 15,504,604 2,202,320 245,342 Gain (Loss) on Derivative Valuation - 2,037,325 (749,166) 483,441 21,960 Total Other Income (expense) 81,537 1,670,182 (850,317) (468,130) 22,158 Gain (Loss) from Continuing Operations (25,277,153) (9,640,578) (14,000,348) (2,670,450) (223,184) Gain (Loss) from Discontinued Operations (196,241) 33,444 (18,638) (904,322) (2,024,583) Net Loss (25,473,394) (9,607,134) (14,018,986) (3,587,553) (2,247,767) Preferred Dividends (3,188,450) (545,020) (89,357) - - Basic and Diluted Net (Loss) Per Share $(0.70) $(0.51) $(0.93) $(0.24) $(0.19) Weighted Average Number of shares outstanding 36,463,197 18,961,099 15,109,401 15,201,303 12,050,759 Balance Sheet Data: Years Ended December 31, 2013 2012 2011 2010 2009 Cash and Cash Equivalents $8,403,731 $485,366 $505,370 $3,900,096 $4,758,852 Current Assets 21,414,290 5,707,864 2,486,625 3,938,135 4,758,852 Net Assets of Discontinued Operations 251,492 280,513 223,758 - 1,079,308 Total Assets 86,430,766 14,946,946 14,226,072 3,952,067 5,838,160 Warrant Derivative Liability - - 2,037,325 1,288,159 804,718 Total Current Liabilities 7,092,747 6,659,204 6,002,196 1,325,498 1,886,272 Additional Paid-In Capital 143,605,036 42,332,298 33,771,622 12,420,166 10,152,118 Accumulated Deficit (62,727,793) (34,065,949) (23,913,795) (9,805,452) (6,217,899) Stockholders Equity 79,338,019 8,287,742 7,244,538 2,626,569 3,951,888 Total Liabilities and Stockholders Equity $86,430,766 $14,946,946 $14,226,072 $3,952,067 $ 5,838,160
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+This summary highlights aspects of our business and the notes. You should, however, carefully read the entire prospectus, including the information presented under the section entitled Risk Factors and our consolidated financial statements and the notes thereto incorporated by reference into this prospectus before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements as a result of certain factors, including those set forth under Risk Factors and Forward-Looking Statements. Unless the context otherwise requires or indicates, references to Biomet, the Company, we, us and our refer to Biomet, Inc. and its subsidiaries. Our Company General Biomet, Inc., an Indiana corporation incorporated in 1977, is one of the largest orthopedic medical device companies in the United States and worldwide with operations in more than 50 locations throughout the world and distribution in approximately 90 countries. Our principal subsidiaries include Biomet U.S. Reconstruction, LLC; Biomet Orthopedics, LLC; Biomet Manufacturing, LLC; Biomet Europe BV; EBI, LLC; Biomet 3i, LLC; Biomet International Ltd.; Biomet Microfixation, LLC; Biomet Sports Medicine, LLC; Biomet Trauma, LLC; and Biomet Biologics, LLC. We design, manufacture and market surgical and non-surgical products used primarily by orthopedic surgeons and other musculoskeletal medical specialists. We operate in one reportable business segment, musculoskeletal products, which includes the design, manufacture and marketing of products in six major categories: Knees, Hips, Sports, Extremities, Trauma, or S.E.T., Spine, Bone Healing and Microfixation, Dental and Cement, Biologics and Other Products. We have three geographic markets: United States, Europe and International. Corporate Information Biomet is incorporated in the State of Indiana. Our principal executive offices are located at 56 East Bell Drive, Warsaw, Indiana 46582. Our website address is www.biomet.com. The information contained on our website or that can be accessed through our website will not be deemed to be incorporated into this prospectus or the registration statement of which this Table of Contents FORWARD-LOOKING STATEMENTS Some of the statements made under the headings Summary and elsewhere in this prospectus contain forward-looking statements within the meaning of U.S. federal securities laws, including Section 27A of the Securities Act and Section 21E of the Exchange Act. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. Forward-looking statements include statements generally preceded by, followed by or that include the words believe, could, expect, forecast, intend, may, anticipate, plan, predict, possibly, project, potential, estimate, should, will, or similar expressions. These statements include, but are not limited to, statements related to: the timing and number of planned new product introductions; the effect of anticipated changes in the size, health and activities of the population or on the demand for our products; assumptions and estimates regarding the size and growth of certain market categories; our ability and intent to expand in key international markets; the timing and anticipated outcome of clinical studies; assumptions concerning anticipated product developments and emerging technologies; the future availability of raw materials; the anticipated adequacy of our capital resources to meet the needs of our business; our continued investment in new products and technologies; the ultimate marketability of products currently being developed; our ability to successfully implement new technologies and transition certain manufacturing operations, including transitions to China; our ability to manage working capital and generate adequate cash flows to service outstanding debt; our ability to sustain sales and earnings growth; our success in achieving timely approval or clearance of our products with domestic and foreign regulatory entities; our success in implementing our operational improvement programs; the stability of certain foreign economic markets; the effect of foreign currency fluctuations on our results; the impact of anticipated changes in the musculoskeletal industry and our ability to react to and capitalize on those changes; our ability to successfully implement desired organizational changes; the impact of our managerial changes; our ability to take advantage of technological advancements; our reliance on our private equity stockholders; our $5,831.7 million of total indebtedness outstanding as of February 28, 2014, and our ability to incur additional indebtedness in the future; and our inability to generate sufficient cash in order to meet our debt service obligations. Any forward-looking statements contained in this prospectus are based upon our historical performance and on our current plans, estimates and expectations in light of information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us, our Principal Stockholders, the underwriters or any other person that the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. You should not place undue reliance on any forward-looking statement and should consider the following factors, as well as the factors discussed elsewhere in this prospectus, including under Risk Factors . We believe that these factors include: changes in general economic conditions and interest rates; changes in the availability of capital and financing sources; changes in competitive conditions and prices in our markets; changes to the regulatory environment for our products, including national health care reform; the effects of incurring or having incurred a substantial amount of indebtedness under our 6.500% senior notes, 6.500% senior subordinated notes and senior secured credit facilities; the effects upon us of complying with the covenants contained in our senior secured credit facilities and the indentures governing our 6.500% senior notes and 6.500% senior subordinated notes; restrictions that the terms and conditions of our 6.500% senior notes and 6.500% senior subordinated notes and our senior secured credit facilities may place on our ability to respond to changes in our business or take certain actions; changes in the relationship between supply of and demand for our products; fluctuations in costs of raw materials and labor; Table of Contents prospectus forms a part, and investors should not rely on any such information in deciding whether to purchase the notes. We have included our website address in this prospectus only as an inactive textual reference and do not intend it to be an active link to our website. For additional information, contact our Corporate Communications department at (574) 372-1514. Ownership and Corporate Structures LVB Acquisition, Inc., or Parent, owns all of our issued and outstanding capital stock. LVB Acquisition Holding, LLC ( Holding ) owns 97.19% of the issued and outstanding capital stock of Parent. Substantially all the equity interests in Holding are owned, directly or indirectly, by a consortium of private equity funds affiliated with The Blackstone Group, Goldman, Sachs & Co., Kohlberg Kravis Roberts & Co. and TPG Global, LLC (together with its affiliates, TPG ), and their co-investors (jointly, the Sponsors ). Table of Contents the effect of foreign currency fluctuations on our results; changes in other significant operating expenses; decreases in sales of our principal product lines; slowdowns or inefficiencies in our product research and development efforts; increases in expenditures related to increased government regulation of our business; developments adversely affecting our sales activities inside or outside the United States; decreases in reimbursement levels by our customers, including certain of our foreign government customers that are experiencing financial distress; difficulties in transitioning certain manufacturing operations to China and other locations; challenges in effectively implementing restructuring and cost saving initiatives; increases in cost-containment efforts from managed care organizations and other third-party payors; loss of our key management and other personnel or inability to attract such management and other personnel; increases in costs of retaining existing independent sales agents of our products; potential future goodwill and/or intangible impairment charges; inability to obtain, protect or enforce our intellectual property rights; unanticipated expenditures related to litigation; and failure to comply with the terms of the DPA (as defined elsewhere in this prospectus). We caution you not to place undue reliance on these forward-looking statements, which speak only as of the date they were made. We do not undertake any obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this prospectus or to reflect the occurrence of unanticipated events. MARKET AND INDUSTRY DATA This prospectus includes industry data and forecasts that we obtained from industry and government publications and surveys, studies conducted by third parties, public filings and internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and market estimates are based on independent industry publications, government publications, third party forecasts and management s estimates and assumptions about our markets and our internal research. While we are not aware of any misstatements regarding our market, industry or similar data presented herein, such data involve risks and uncertainties and are subject to change based on various factors, including those discussed in Cautionary Note Regarding Forward-Looking Statements and Risk Factors in this prospectus. TERMS USED IN THIS PROSPECTUS Unless otherwise noted or indicated by the context, in this prospectus: The term guarantors , as of the date of this prospectus with respect to both the senior notes and the senior subordinated notes, means Biomet 3i, LLC, Biomet Biologics, LLC, Biomet Europe Ltd., Biomet Fair Lawn, LLC, Biomet Florida Services, LLC, Biomet International Ltd, Biomet Leasing, Inc., Biomet Manufacturing, LLC, Biomet Microfixation, LLC, Biomet Orthopedics, LLC, Biomet Spine, LLC, Biomet Sports Medicine, LLC, Biomet U.S. Reconstruction, LLC, Biomet Trauma, LLC, Cross Medical Products, LLC, EBI Holdings, LLC, EBI, LLC, EBI Medical Systems, LLC, Electro-Biology, LLC, Implant Innovations Holdings, LLC, Interpore Cross International, LLC, Interpore Spine Ltd., Kirschner Medical Corporation, Lanx, Inc. and Lanx Sales, LLC. However, since each of our current and future wholly owned domestic restricted subsidiaries that is a guarantor of our senior secured credit facilities will fully and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, the identities of the guarantors may change from time to time without notice. See Description of Senior Notes Guarantees and Description of Senior Subordinated Notes Guarantees. The term senior notes indenture refers to the Senior Notes Indenture dated as of August 8, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association and the First Supplemental Indenture, dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association, collectively. The term senior subordinated notes indenture refers to the Senior Subordinated Notes Indenture dated as of October 2, 2012 among Biomet, Inc., the Guarantors listed therein and Wells Fargo Bank, National Association. The term indentures refers to the senior notes indenture and senior subordinated notes indenture, collectively. Table of Contents Summary of the Terms of the Notes The following summary contains basic information about the notes and is not intended to be complete. It does not contain all the information that is important to you. For a more complete understanding of the notes, you should read the section of the prospectus entitled Description of Senior Notes and Description of Senior Subordinated Notes. For purposes of this summary and the Description of Senior Notes and Description of Senior Subordinated Notes, references to the Company, Biomet, the issuer, we, our and us refer only to Biomet, Inc. and not to its subsidiaries. Issuer Biomet, Inc. Notes Offered Senior Notes $1,825 million in aggregate principal amount of 6.500% Senior Notes due 2020. Senior Subordinated Notes $800 million in aggregate principal amount of 6.500% Senior Subordinated Notes due 2020. Maturity Dates The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. Interest Rates Interest on the notes will be payable in cash and will accrue at a rate of 6.500% per annum. Interest Payment Dates Senior Notes August 1 and February 1, commencing February 1, 2013. Senior Subordinated Notes April 1 and October 1, commencing April 1, 2013. Guarantees Each of our existing and future wholly-owned domestic restricted subsidiaries has jointly, severally and unconditionally guaranteed the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. Table of Contents EXPLANATORY NOTE This Registration Statement relates to the previously filed Registration Statement on Form S-1 (File No. 333-188262) (the Previous Registration Statement ) of Biomet, Inc. ( Biomet ). Biomet filed the Previous Registration Statement to register the following securities issued by Biomet and guaranteed by the guarantors named in the Registration Statement: $1,825,000,000 6.500% Senior Notes due 2020 (the Senior Notes ) and $800,000,000 6.500% Senior Subordinated Notes due 2020 (the Senior Subordinated Notes ). There were no applicable registration fees required to be paid at the time of the original filing of the Previous Registration Statement. This Registration Statement has two purposes: First, to register subsidiary guarantees of the Senior Notes and the Senior Subordinated Notes by certain additional subsidiaries (the Additional Subsidiary Guarantors ) of Biomet, and to include the Additional Subsidiary Guarantors as registrants; and Second, to update the Previous Registration Statement pursuant to Section 10(a)(3) of the Securities Act to incorporate by reference the consolidated financial statements and the notes thereto included in Biomet Annual Report on Form 10-K for the fiscal year ended May 31, 2013 (as updated in the Current Report on Form 8-K filed on April 11, 2014) and to update certain other information in the Registration Statement. Pursuant to Rule 429 under the Securities Act of 1933, as amended, this Registration Statement, upon effectiveness, will serve as a post-effective amendment to the Previous Registration Statement. Table of Contents Ranking Senior Notes The senior notes are our senior unsecured obligations and rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; are senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and are effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior notes are such guarantors senior unsecured obligations and rank pari passu in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto; and are effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Senior Subordinated Notes The senior subordinated notes are our senior subordinated unsecured obligations and rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future subordinated indebtedness and effectively junior to our existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. Similarly, the guarantees of the senior subordinated notes are such guarantors senior subordinated unsecured obligations, and rank junior in right of payment with all existing and future indebtedness of each guarantor that is not expressly subordinated thereto; rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and are senior in right of payment to any future indebtedness of each guarantor that is expressly subordinated in right of payment thereto and effectively junior to all existing and future secured indebtedness of each guarantor to the extent of the value of the collateral securing such indebtedness. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 11, 2014 PRELIMINARY PROSPECTUS $1,825,000,000 6.500% Senior Notes due 2020 $800,000,000 6.500% Senior Subordinated Notes due 2020 NOTES OFFERED $1,825.0 million of our 6.500% Senior Notes due 2020, which we refer to as the senior notes. $800.0 million of our 6.500% Senior Subordinated Notes due 2020, which we refer to as the senior subordinated notes. We refer to the senior notes and the senior subordinated notes collectively as the notes. MATURITY The senior notes will mature on August 1, 2020. The senior subordinated notes will mature on October 1, 2020. INTEREST Senior notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. Senior subordinated notes: Interest is payable in cash and accrues at the rate of 6.500% per annum. INTEREST PAYMENT DATES Senior notes: August 1 and February 1, commencing February 1, 2013. Senior subordinated notes: April 1 and October 1, commencing April 1, 2013. REDEMPTION We may redeem some or all of the senior notes on or after August 1, 2015 at redemption prices described in this prospectus. We may redeem some or all of the notes on or after October 1, 2015 at redemption prices described in this prospectus. CHANGE OF CONTROL Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes as described in this prospectus. GUARANTEES Each of our existing and future wholly-owned domestic restricted subsidiaries will jointly, severally and unconditionally guarantee the senior notes on a senior unsecured basis and the senior subordinated notes on a senior subordinated unsecured basis, in each case to the extent such subsidiaries guarantee our senior secured credit facilities. RANKING The senior notes and the related guarantees will be our senior unsecured obligations and will rank pari passu in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto; be senior in right of payment to any future indebtedness that is expressly subordinated in right of payment thereto (including our senior subordinated notes); and be effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. The senior subordinated notes will be our senior subordinated unsecured obligations and will rank junior in right of payment with all of our existing and future indebtedness that is not expressly subordinated in right of payment thereto (including the senior notes); rank pari passu in right of payment to any of our existing and future senior subordinated indebtedness and other obligations; and be senior in right of payment to any future subordinated indebtedness and effectively junior to our and our guarantors existing and future secured indebtedness (including the borrowings under our senior secured credit facilities), to the extent of the value of the collateral securing such indebtedness and to all existing and future liabilities of our non-guarantor subsidiaries. See Risk Factors beginning on page 7 for a discussion of certain risks that you should consider before investing in the notes. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. This prospectus has been prepared for and may be used by Goldman, Sachs & Co. and any affiliates of Goldman, Sachs & Co. in connection with offers and sales of the notes related to market-making transactions in the notes effected from time to time. Goldman, Sachs & Co. or its affiliates may act as principal or agent in such transactions, including as agent for the counterparty when acting as principal or as agent for both counterparties, and may receive compensation in the form of discounts and commissions, including from both counterparties, when it acts as agents for both. Such sales will be made at prevailing market prices at the time of sale, at prices related thereto or at negotiated prices. We will not receive any proceeds from such sales. The date of this prospectus is , 2014. We are responsible for the information contained or incorporated by reference in this prospectus. We have not authorized anyone to provide you with additional information or information different from that contained in this prospectus and we take no responsibility for any other information that others may give you. This prospectus does not offer to sell nor ask for offers to buy any of the securities in any jurisdiction where it is unlawful, where the person making the offer is not qualified to do so, or to any person who cannot legally be offered the securities. You should not assume that the information contained in or incorporated by reference in this prospectus is accurate as of any date other than the date on the front cover of this prospectus or the date of any document incorporated by reference herein. Table of Contents Optional Redemption Senior Notes At any time prior to August 1, 2015, we may redeem up to 35% of the aggregate principal amount of the senior notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to August 1, 2015, we may redeem the senior notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after August 1, 2015, we may redeem some or all of the senior notes at any time at the redemption prices set forth in this prospectus plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Notes Optional Redemption. Senior Subordinated Notes At any time prior to October 1, 2015, we may redeem up to 40% of the aggregate principal amount of the senior subordinated notes with the net proceeds of certain equity offerings at the redemption price set forth in this prospectus, plus accrued and unpaid interest, if any, to the redemption date. At any time prior to October 1, 2015, we may redeem the senior subordinated notes, in whole or in part, at our option, at a redemption price equal to 100% of their principal amount plus a make-whole premium and accrued and unpaid interest, if any, to the date of redemption. On and after October 1, 2015, we may redeem some or all of the senior subordinated notes at any time at the redemption prices set forth herein plus accrued and unpaid interest, if any, to the date of redemption. See Description of Senior Subordinated Notes Optional Redemption. Change of Control Upon certain change of control events, each holder of notes may require us to purchase all or a portion of such holder s notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to the purchase date. See Description of Senior Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Notes Certain Definitions, and Description of Senior Subordinated Notes Repurchase at the Option of Holders Change of Control and the definition of Change of Control under Description of Senior Subordinated Notes Certain Definitions. Table of Contents Certain Covenants The indentures governing the notes contain covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to: pay dividends on, redeem or repurchase capital stock or make other restricted payments; make investments; incur indebtedness or issue certain equity; create certain liens; incur obligations that restrict the ability of our subsidiaries to make dividend or other payments to us; enter into transactions with our affiliates; create or designate unrestricted subsidiaries; and consolidate, merge or transfer all or substantially all of our assets. These covenants are subject to important exceptions and qualifications, which are described under the headings Description of Senior Notes and Description of Senior Subordinated Notes in this prospectus. Certain of these covenants will be suspended if the notes are assigned an investment grade rating by Standard & Poor s Rating Services ( Standard & Poor s ) and Moody s Investors Services, Inc. ( Moody s ) and no default has occurred and is continuing. If either rating on the notes should subsequently decline to below investment grade or a default occurs and is continuing, the suspended covenants will be reinstated. Listing We do not intend to list the notes on any securities exchange. Governing Law The notes are governed by, and construed in accordance with, the laws of the State of New York. Trustee Wells Fargo Bank, National Association
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. It does not contain all of the information you should consider before buying shares of our common stock. You should read the entire prospectus carefully, especially the "Risk Factors" section, our consolidated financial statements and the related notes appearing at the end of this prospectus, before deciding to invest in shares of our common stock. Unless the context provides otherwise, all references to "Pimi," "we," "us," "our," or similar terms, refer to Pimi Agro Cleantech, Inc. and its wholly owned subsidiary. In this prospectus all references to "$" or "dollars" mean the U.S. dollar, and unless otherwise indicated all currency amounts in this prospectus are stated in U.S. dollars. All financial statements have been prepared in accordance with accounting principles generally accepted in the United States and are reported in U.S. dollars. The Company Pimi develops environmentally friendly solutions for extending storability and shelf life of fruits and vegetables. The Company, through its Israeli operating subsidiary, Pimi Agro CleanTech, Ltd, ("Pimi Israel"), owns a patented technology for the treatment of pre- and post-harvest fruits and vegetables. Pimi utilizes environmentally friendly products that are based on a unique formulation of environmentally friendly Stabilized Hydrogen Peroxide (STHP). STHP products, which decompose into oxygen and water and leave no residue, provide a cost-effective, safer and healthier solution for consumers who want to reduce the residue of chemicals in fruits and vegetables consumed. Pimi s main product (FreshProtect) has been recently registered and approved for sale and use by the United States Environmental Protection Agency (EPA) and the California Department of Pesticide Regulation (CDPR), and we have already commenced commercial sales of this product in the citrus season which began in October 2013. As of the date of this registration statement, the Company has sold FreshProtect and CitruWash (another of the Company s products, utilized together with FreshProtect for a comprehensive treatment) to Decco Ltd., a leading US post-harvest services company, in the aggregated amount of approximately $100,000. Simultaneously the Company is in negotiations with other post-harvest services companies for conducting efficacy proof tests, successful results of which will lead, as the Company believes, to an increase in sales of FreshProtect and CitruWash. Pimi s environmentally friendly solutions for extending storability and shelf life of fruits and vegetables apply to both the harvest and the distribution of fruits and vegetables. Currently, Pimi is developing cleansers and sanitizers for the treatment of fruits and vegetables on packing line, as well as sprout and disease control products for use when storing fruits and vegetables. Within the fruit and vegetable area, Pimi s current primary focus is on developing products for the treatment of citrus fruits and sweet potatoes. In addition, Pimi is also developing a device for preventing decay during the shipment and transport of fruits and vegetables. Leadership Ami Sivan (Chief Executive Officer) Mr. Ami Sivan, who joined the Company in May 2012, is Pimi s Chief Executive Officer. In 2011, Mr. Sivan founded AMC Israel Farming, a Spanish agriculture and marketing company, which is a member of AMC. Between 1984-2011, Mr. Sivan was employed by Mehadrin Group Israel ("Mehadrin"). Between 2001-2006, he served as the CEO of Mehadrin Tnuport Export (a subsidiary of Mehadrin). During 2000-2001, Mr. Sivan served as the CEO of Pri-or Ltd., an agricultural arm of Mehadrin. Mr. Sivan is a former pilot in the Israeli Air Force and an agronomist Alon Carmel (Chairman of the Board of Directors) Mr. Alon Carmel has been the Chairman of Pimi s Board of Directors since September 2008 In 1998, Mr. Carmel co-founded Spark Networks (AMEX:LOV), which created and runs several successful websites, such as JDate.com, Cupid.co.il and AmericanSingles.com. After leaving Spark Networks in 2005, Mr. Carmel invested in a wide range of early stage internet-related start-ups.. Between 1983-1991, Mr. Carmel enjoyed a successful career in real estate. Mr. Carmel is a member of the Boards of Spateva LTD, InterLogic LTD, Pipl Search LTD, My League LTD, Alefo Interactive LTD., Audiogate Technologies LTD, Clicknlink.com Inc., Jlove LLC and Rodeo Consulting LLC. Mr. Carmel is a graduate of The Technion- Israel Institute of Technology, where he pursed his engineering degree. Avi Lifshitz (Chief Financial Officer) Mr. Avi Lifshitz, a certified public accountant in Israel, is our Chief Financial Officer. Mr. Lifshitz has more than 25 years of experience in accounting, finance and business management. In 1990, Mr. Lifshitz established Meiri-Lifshitz Accounting firm of which he is a partner since. Moreover, for the past 19 years, Mr. Lifshitz has been serving as the CFO of Jordan Valley Semiconductors Ltd - a company that prepares its financial statements in accordance with U.S. GAAP. Mr. Lifshitz is also the Secretary of Jordan Valley Semiconductors UK Ltd, Jordan Valley Semi Conductors Gmbh (Germany) Ltd and Jordan Valley Semiconductors Taiwan Ltd. Furthermore, Mr. Lifshitz is a director in Bede Scientific Inc. (US), Efrat Consultants Ltd (ISR) and Ed-Wise Ltd (ISR). Mr. Lifshitz taught at the Technion - Israel Institute of Technology, where he won an award for excellence in 1998. Mr. Lifshitz holds a B.A. degree in Economics and Accounting from Haifa University Table of Contents CALCULATION OF REGISTRATION FEE Title of each class of securities to be registered Proposed maximum aggregate offering price Amount of registration fee Units, each consisting of 1 share(s) of Common Stock, $0.01 and 1 Common Stock Warrant(s) Shares of Common Stock included as part of the units Common Stock Class A Warrants included as part of the units Shares of Common Stock acquirable upon exercise of the Common Stock Warrants Shares of Common Stock acquirable TOTAL $5,000,000 $644.00 Table of Contents Nimrod Ben-Yehuda (Chief Technology Officer and Director) Mr. Nimrod Ben-Yehuda has been Pimi s Chief Technology Officer since 2003. He is also a member of Pimi s Board of directors. He is the Co-Founder of Pimi and the inventor of the Company s products. As a leading entrepreneur in the field of environmentally friendly solutions using STHP, Mr. Ben-Yehuda is responsible for developing the Company s technology. Between 1993-2003, Mr. Ben-Yehuda served as a joint CEO and CTO of Swissteril Water Purifications Ltd, which developed a protocol for purification of water. Between 1989-2003, he served as the CEO of Nir Ecology Ltd, which develops ecological solutions for food industries, hospitals and veterinarians. Between 1986-1989, Mr. Ben-Yehuda served as the Joint CEO of NitroJet Ltd. Doron Shorrer (Director) Mr. Doron Shorrer, a certified public accountant, is a member of Pimi s Board of Directors. Since 1998, Mr. Shorrer has been the Chairman and CEO of Shorrer International Ltd – an investment company providing financial consulting. Additionally, since 2008, Mr. Shorrer has been a member of the Boards of Bank Massad Ltd, Ofek Cooperative for Capital Management Ltd, and Omer Insurance Company. Between 2005-2007, Mr. Shorrer served as a Chairman of Lito Group (industrial). Between 2003-2006, Mr. Shorrer was the Chairman of Pluristem Life System, Inc. (a bio-technology company traded on NASDAQ) of which he is still a member. Between 2004-2005, Mr. Shorrer served as the Deputy Chairman of Milomor (construction), and between 2002-2004 Mr. Shorrer served as the Chairman of the Israeli Phoenix Insurance Company. Mr. Shorrer holds a BA degree in Economics and Accounting and an MA degree in Business Administration from the Hebrew University of Jerusalem. Table of Contents The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended (the "Securities Act"), or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. Table of Contents The Offering Units: Units offered Minimum amount 1,600,000 Units, at $[ ] per Unit Maximum Amount 4,000,000 Units, at $[ ] per Unit Each Unit consists of 1 share(s) of common stock, $0.01 par value (a "Share"), and 1 common stock warrant(s) (a "Warrant"). Common Stock: Common stock offered Minimum amount of 1,600,000 Shares Maximum amount of 4,000,000 Shares Common stock outstanding before the offering (1) 9,336,487 Shares Common stock outstanding after the offering (2) Minimum amount of 10,936,487 Shares Maximum amount of 13,336,487 Shares Quoting Our common stock is currently listed on the Over-the-Counter Bulletin Board under the symbol "PIMZ". Class A Warrants: Exercisability Each Warrant is exercisable for 1 share(s) of common stock. Exercise Price $[ ] Exercise Period The Warrants become exercisable [ ] days from the date of this prospectus. The Warrants will expire at [ ] p.m., [ ] time, on [ ]. Use of Proceeds: The net proceeds from the sale of the common stock in this offering are estimated to be approximately $[ ] after deducting Sandlapper Securities, LLC commissions and fees and estimated offering expenses. We intend to use the net proceeds from this offering to fund working capital needs and other general corporate purposes and to retire certain accounts payable, accrued expenses and other short-term liabilities. See "Use of Proceeds" at page 17
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001475065_tungsten_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001475065_tungsten_prospectus_summary.txt
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+PROSPECTUS SUMMARY You should read the following summary together with the more detailed information and the financial statements appearing elsewhere in this Prospectus. This Prospectus contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth under "Risk Factors" and elsewhere in this Prospectus. Unless the context indicates or suggests otherwise, references to "we," "our," "us," the "Company," or the "Registrant" refer to Tungsten Corp., a Nevada corporation. Our Business Corporate Information We were incorporated in the state of Nevada on June 5, 2008 under the name "Online Tele-Solutions, Inc." On March 14, 2012, we approved an amendment to the Company s Articles of Incorporation (i) increasing the number of authorized shares of common stock from 50,000,000 to 300,000,000, (ii) creating 25,000,000 shares of "blank check" preferred stock, and (iii) effecting a thirty-for-one (30:1) forward split of the Company s issued and outstanding shares of common stock. The forward split became effective with the Financial Industry Regulatory Authority as of the opening of business on May 9, 2012. We are an exploration stage mining company engaged in the identification, acquisition, and exploration of metals and minerals with a focus on tungsten mineralization on our properties located in Nevada. We intend to conduct exploration and development programs on our recently optioned properties as described below. We originally intended to develop and offer Internet-based hosted call center services for small to medium sized companies that are seeking to establish their own internal support and telemarketing divisions. We have not been successful in our product development and execution of the initial stage of our original business plan and as such, we pursued other avenues in our efforts to maintain shareholder value. On April 8, 2013, we entered into and closed a voluntary share exchange transaction pursuant to a stock exchange agreement with Guy Martin and Nevada Tungsten Holdings Ltd. (the "SEA"). Pursuant to the terms of the SEA, we acquired all of the issued and outstanding shares of Nevada Tungsten Holdings Ltd. s common stock from Guy Martin in exchange for the issuance by our company of 3,000,000 shares of our common stock to Guy Martin (the "Transaction"). The sole asset of Nevada Tungsten Holdings Ltd. is an option to acquire all tungsten rights in regards to 32 patented and unpatented mining claims situated in White Pine Country, Nevada pursuant to an option agreement by and between Viscount Nevada Holdings Ltd. and Nevada Tungsten Holdings Ltd. (the "Option Agreement"). As a result of the transaction described above, Nevada Tungsten Holdings Ltd. became our wholly-owned subsidiary. On November 6, 2012, we changed our name to Tungsten Corp. Nevada Tungsten Holdings Ltd. was incorporated in the state of Nevada on October 30, 2012, with the goal of investigating for promising tungsten opportunities in the United States. Nevada Tungsten Holdings Ltd. s operations since incorporation focused on the investigation and identification of promising tungsten opportunities. We hereby amend this registration statement on such date or dates as may be necessary to delay its effective date until we shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. The sole asset of Nevada Tungsten Holdings Ltd. is an option to acquire all tungsten rights in regards to 32 patented and unpatented mining claims situated in White Pine County, Nevada (the "Cherry Creek Tungsten Project"). In order to complete the transactions contemplated by the Option Agreement by and between Viscount Nevada Holdings Ltd. (the "Optionor") and Nevada Tungsten Holdings Ltd. Nevada Tungsten Holdings Ltd. was initially required to pay $150,000 to the Optionor by February 15, 2013, which amount has now been paid. Pursuant to the SEA, we agreed to undertake Nevada Tungsten Holdings Ltd. s obligations under the Option Agreement. The Option Agreement gives the Company the option to acquire a 100% interest in all tungsten on the Cherry Creek Tungsten Project by (i) paying $100,000 to the Optionor on or before February 15, 2014 and $50,000 to the Optionor on or before February 15, 2015; and (ii) incur exploration expenditures on the property of $250,000 on or before the first anniversary of the option agreement, additional exploration expenditures on the property of $250,000 on or before the second anniversary of the option agreement, and additional exploration expenditures on the property of $1,000,000 on or before the third anniversary of the option agreement. The Optionor has retained a 3% net smelter return royalty. On February 7, 2014, the parties to the Option Agreement agreed to defer the payment due on February 15, 2014 and exploration expenditures requirement due on the first anniversary of the Option Agreement until June 15, 2014. As consideration for this deferment, the Company issued 250,000 shares of Company common stock to the Optionor. On April 19, 2013, Nevada Tungsten Holdings Ltd. entered into a purchase agreement (the "Monfort Agreement") with Monfort Ventures Ltd. ("Monfort"), pursuant to which we acquired title to certain unpatented pacer mining claims located in Custer County, Idaho (the "Idaho Property") in consideration for the issuance of 3,000,000 shares of our common stock to Monfort. Upon the commencement of operations of a producing mine on the Idaho Property and the production of mineral products therefrom, the Idaho Property will be subject to a net smelter returns royalty of 3%. For purposes of the Monfort Agreement,"net smelter returns" means the net proceeds paid to us from the sale of minerals mined and removed from the Idaho Property after deducting certain expenses as specified in the Monfort Agreement. At any time after execution of the Monfort Agreement, we may acquire one percent (1%) of the net smelter royalty from Monfort for Five Hundred Thousand Dollars ($500,000) and thereafter, may acquire another additional one percent (1%) of the net smelter royalty from Monfort for One Million Dollars ($1,000,000). Since we are an exploration stage company, there is no assurance that a commercially viable mineral reserve exists on any of our current or future properties. To date, we do not know if an economically viable mineral reserve exists on our property and there is no assurance that we will discover one. Even if we do eventually discover a mineral reserve on our property, there can be no assurance that we will be able to develop our property into a producing mine and extract those resources. Both mineral exploration and development involve a high degree of risk and few properties which are explored are ultimately developed into producing mines. Our current operational focus is to conduct exploration activities on the Cherry Creek Tungsten Project and the Idaho Property, and to complete the terms of the Option Agreement. For a description of our Cherry Creek Tungsten Project, please see the section entitled "Properties" in this prospectus. For the fiscal year ended January 31, 2014, we had a net loss of $1,481,142 as compared to a net loss of $23,391 for the period from inception (October 30, 2012) through January 31, 2013. Our current burn rate is approximately $35,000 per month. We will need $2,000,000 in additional financing for us to break-even and achieve self-sufficiency on a cash flow basis. Our January 31, 2014 financial statements indicated that there was substantial doubt about the Company continuing as a going concern. Based on our current burn rate, we will run out of funds in April 2014 assuming we raise no additional capital. Recent Developments Senior Convertible Note Financing with Hanover Holdings I, LLC Note Purchase Agreement and Convertible Note SUBJECT TO COMPLETION, DATED MAY _, 2014 PROSPECTUS 21,338,254 SHARES OF COMMON STOCK TUNGSTEN CORP. This prospectus relates to the resale of up to 21,338,254 shares of our common stock, which may be offered by the selling stockholders. The shares of common stock being offered by the selling stockholders (i) are issuable (A) upon conversion of a senior convertible note in the principal amount of $127,500, or the Convertible Note, that we issued to Hanover Holdings LLC ("Hanover") on January 2, 2014; (B) pursuant to a Common Stock Purchase Agreement dated as of February 18, 2014 between us and Hanover (the "Purchase Agreement"); and (ii) are held by our current directors and officers, including Guy Martin (President, Chief Executive Officer, Treasurer, Chief Financial Officer), Douglas Oliver (Vice President of Exploration), Joseph Galda (Corporate Secretary) and David Bikerman. We are not selling any securities under this prospectus and will not receive any of the proceeds from the resale of shares of our common stock by the selling stockholders under this prospectus, however, we have received gross proceeds of $85,000 from the sale of the Convertible Note to Hanover and we may receive gross proceeds of up to $3,000,000 from sales of our common stock to Hanover under the Purchase Agreement. The selling stockholders may offer all or part of the shares for resale from time to time through public or private transactions, at either prevailing market prices or at privately negotiated prices. We provide more information about how Hanover may sell its shares of common stock in the section titled "Plan of Distribution" in this prospectus. We will pay the expenses incurred in connection with the offering described in this prospectus, with the exception of brokerage expenses, fees, discounts and commissions, which will be paid by the selling stockholders. In addition, we issued 2,065,177 shares of our common stock to Hanover as an initial commitment fee for entering into the Purchase Agreement and we may issue additional commitment shares to Hanover under certain circumstances described in this Prospectus. With respect to the shares of common stock that have been and may be issued pursuant to the Purchase Agreement, Hanover is an "underwriter" within the meaning of Section 2(a)(11) of the Securities Act of 1933, as amended, or the Securities Act, and with respect to any other shares of common stock, Hanover may be deemed to be an "underwriter" within the meaning of Section 2(a)(11) of the Securities Act. Our common stock is quoted on the OTCQB, under the symbol "TUNG". The last reported sale price of our common stock on the OTCQB on March 31, 2014 was $0.07 per share. Investing in our common stock involves a high degree of risk. Please see the sections entitled "Risk Factors" in this prospectus and "Part I—Item 1A Risk Factors" in our Annual Report on Form 10-K for our fiscal year ended January 31, 2014. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. On January 2, 2014, we entered into a note purchase agreement with Hanover, which we refer to as the Note Purchase Agreement. The Note Purchase Agreement provides that, upon the terms and subject to the conditions set forth in the Note Purchase Agreement, Hanover will purchase from us the Convertible Note with an initial principal amount of $127,500 for a purchase price of $85,000, representing a 33.33% original issue discount. We issued the Convertible Note to Hanover on January 2, 2014. As of the date of filing of this Registration Statement on Form S-1, the principle amount due under the Convertible Note has not been extinguished and will bear interest at 12% per annum. The total principle amount plus interest due under the Convertible Note as of September 2, 2014 will equal $137,700. The Company does not believe it will have the financial ability to repay the amounts due under the Convertible Note as of September 2, 2014 without the use of funds received under the Purchase Agreement. The Company will, however, entertain the note conversion at the holder s option, into shares of common stock of the Company at a minimum share price of $0.0325 per share. $22,500 of the outstanding principal amount of the Convertible Note (together with any accrued and unpaid interest with respect to such portion of the principal amount) will be automatically extinguished (without any cash payment by us) if (i) the registration statement of which this prospectus is a part is declared effective by the SEC on or prior to the earlier of (A) the 100th calendar day after January 2, 2014 and (B) the fifth business day after the date we are notified by the Securities and Exchange Commission, or the Commission, that the registration statement will not be reviewed or will not be subject to further review, and this prospectus is available for use by Hanover for the resale by Hanover of all of the shares of our common stock issued or issuable upon conversion of the Convertible Note and (ii) no event of default under the Convertible Note or an event that with the passage of time or giving of notice would constitute an event of default under the Convertible Note has occurred on or prior to such date. The Convertible Note matures on September 2, 2014 and, in addition to the 33.33% original issue discount, accrues interest at the rate of 12% per year. The Convertible Note is convertible at any time, in whole or in part, at Hanover s option into shares of our common stock at a fixed conversion price of $0.0325 per share, subject to adjustment pursuant to the "full ratchet" and standard anti-dilution provisions contained in the Convertible Note. This conversion price represents a discount of 50% from the closing price of our common stock of $0.0650 on December 31, 2013. At no time will Hanover be entitled to convert any portion of the Convertible Note to the extent that after such conversion, Hanover (together with its affiliates) would beneficially own more than 9.99% of our common stock (as calculated pursuant to Section 13(d) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, and the rules and regulations thereunder). The Convertible Note includes customary event of default provisions, and provides for a default interest rate of 18%. Upon the occurrence of an event of default, Hanover may require us to pay in cash the "Event of Default Redemption Price" which is defined in the Convertible Note to mean the greater of (i) the product of (A) the amount to be redeemed multiplied by (B) 125% (or 100% if an insolvency related event of default) and (ii) the product of (X) the conversion price in effect at that time multiplied by (Y) the product of (1) 125% (or 100% if an insolvency related event of default) multiplied by (2) the greatest closing sale price of our common stock on any trading day during the period commencing on the date immediately preceding such event of default and ending on the date we make the entire payment required to be made under this provision. We have the right at any time to redeem all, but not less than all, of the total outstanding amount then remaining under the Convertible Note in cash at a price equal to 140% of the total amount of the Convertible Note then outstanding. The Note Purchase Agreement contains customary representations, warranties and covenants by, among and for the benefit of the parties. We also agreed to pay up to $27,500 of reasonable attorneys' fees and expenses incurred by Hanover in connection with the transaction. We also agreed to pay a fee of $4,250 to Garden State Securities for its services in acting as placement agent in connection with the transaction. The Note Purchase Agreement also provides for indemnification of Hanover and its affiliates in the event that Hanover incurs losses, liabilities, obligations, claims, contingencies, damages, costs and expenses related to a breach by us of any of our representations, warranties or covenants under the Note Purchase Agreement. The date of this prospectus is __________, 2014. The information in this Prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission becomes effective. This Prospectus is not an offer to sell these securities and we are not soliciting an offer to buy these securities in any state where the offer or sale is not permitted or would be unlawful prior to registration or qualification under the securities laws of any such state. The issuance of the Convertible Note to Hanover under the Note Purchase Agreement was exempt from the registration requirements of the Securities Act pursuant to the exemption for transactions by an issuer not involving any public ffering under Section 4(a)(2) of the Securities Act and Rule 506 of Regulation D promulgated under the Securities Act. Note Registration Rights Agreement In connection with the execution of the Note Purchase Agreement, on January 2, 2014, Hanover and we also entered into a registration rights agreement, which we refer to as the Note Registration Rights Agreement. Pursuant to the Note Registration Rights Agreement, we agreed to file the registration statement of which this prospectus is a part with the Commission to register for resale 3,923,077 shares of our common stock into which the Convertible Note may be converted and have it declared effective at the earlier of (i) the 100th calendar day after January 2, 2014 and (ii) the fifth business day after the date we are notified by the Commission that the registration statement will not be reviewed or will not be subject to further review. We have agreed to file with the Commission one or more additional registration statements to cover all of the securities required to be registered under the Note Registration Rights Agreement that are not covered by this prospectus, in each case, as soon as practicable, but in no event later than the applicable filing deadline for such additional registration statements as provided in the Note Registration Rights Agreement. We also agreed, among other things, to indemnify Hanover from certain liabilities and fees and expenses of Hanover incident to our obligations under the Note Registration Rights Agreement, including certain liabilities under the Securities Act. Hanover has agreed to indemnify and hold harmless us and each of our directors, officers and persons who control us against certain liabilities that may be based upon written information furnished by Hanover to us for inclusion in the registration statement of which this prospectus is a part, including certain liabilities under the Securities Act. Equity Enhancement Program with Hanover Holdings I, LLC Common Stock Purchase Agreement On February 18, 2014, which we refer to as the Closing Date, we entered into the Purchase Agreement with Hanover. The Purchase Agreement provides that, upon the terms and subject to the conditions set forth therein, Hanover is committed to purchase up to $3,000,000, which we refer to as the Total Commitment, worth of our common stock, which we refer to as the Shares, over the 24-month term of the Purchase Agreement. From time to time over the term of the Purchase Agreement, commencing on the trading day immediately following the date on which the registration statement of which this prospectus is a part is declared effective by the Commission, we may, in our sole discretion, provide Hanover with either "regular" draw down notices or, if certain conditions are satisfied, "fixed" draw down notices, each referred to as a Draw Down Notice, in each case to purchase a specified amount of Shares, which we refer to as the Draw Down Amount, with each draw down subject to the limitations discussed below. The maximum amount of Shares requested to be purchased pursuant to any single "regular" Draw Down Notice, each a Regular Draw Down Notice, cannot exceed 350% of the average daily trading volume of the Company s common stock for the 10 trading days immediately preceding the date of the Regular Draw Down Notice, which we refer to as the Maximum Regular Draw Down Amount. The maximum amount of Shares requested to be purchased pursuant to any single "fixed" Draw Down Notice, each a Fixed Draw Down Notice, cannot exceed the lesser of (i) $250,000 worth of our common stock and (ii) 250% of the average daily trading volume of the Company s common stock for the 10 trading days immediately preceding the date of the Fixed Draw Down Notice, which we refer to as the Maximum Fixed Draw Down Amount. Each purchase pursuant to a draw down will reduce, on a dollar-for-dollar basis, the Total Commitment under the Purchase Agreement. We may, in our sole discretion, provide Hanover with Regular Draw Down Notices to purchase a specified Draw Down Amount, up to the Maximum Regular Draw Down Amount, over a 10 consecutive trading day period commencing on the trading day specified in the applicable Regular Draw Down Notice, which we refer to as the Pricing Period. Once presented with a Regular Draw Down Notice, Hanover is required to purchase a pro rata portion of the applicable Draw Down Amount on each trading day during the applicable Pricing Period on which the daily volume weighted average price for our common stock, or VWAP, equals or exceeds an applicable floor price, or Floor Price, equal to the product of (i) 0.70 and (ii) the VWAP over the 10 trading days immediately preceding the date the Regular Draw Down Notice is delivered, subject to adjustment for any stock splits, stock combinations, stock dividends, recapitalizations and other similar transactions. If the VWAP falls below the applicable Floor Price on any trading day during the applicable Pricing Period, the Purchase Agreement provides that Hanover will not purchase the pro rata portion of the applicable Draw Down Amount allocated to that trading day. The per share purchase price for the Shares subject to a Regular Draw Down Notice will be equal to 95.0% of the arithmetic average of the three lowest daily VWAPs that equal or exceed the applicable Floor Price during the applicable Pricing Period, except that if the VWAP does not equal or exceed the applicable Floor Price for at least three trading days during the applicable Pricing Period, then the per share purchase price will be equal to 95.0% of the arithmetic average of all VWAPs that equal or exceed the applicable Floor Price during such Pricing Period. We may, in our sole discretion, on any trading day on which both of the equity conditions described below are satisfied, provide Hanover with a Fixed Draw Down Notice to purchase a specified Draw Down Amount, up to the Maximum Fixed Draw Down Amount, on the applicable settlement date, which will occur within one trading day following the date the Fixed Draw Down Notice is delivered. The per share purchase price for the Shares subject to a Fixed Draw Down Notice, or the Fixed Purchase Price, will be equal to 90.0% of the lower of (i) the lowest trade price of a share of our common stock on the date the Fixed Draw Down Notice is delivered, which we refer to as the Draw Down Exercise Date, and (ii) the arithmetic average of the three lowest daily VWAPs during the 10 consecutive trading days ending on the trading day immediately preceding the applicable Draw Down Exercise Date. We may deliver a Fixed Draw Down Notice only if both of the following equity conditions have been satisfied as of the applicable Draw Down Exercise Date: on each trading day during the period beginning 30 trading days prior to the applicable Draw Down Exercise Date and ending on and including the applicable Draw Down Exercise Date, the lowest trade price of a share of our common stock must be greater than $0.20, subject to adjustment for any stock splits, stock combinations, stock dividends, recapitalizations and other similar transactions, which we refer to as the Fixed Floor Price; and on each trading day during the period beginning 30 trading days prior to the applicable Draw Down Exercise Date and ending on and including the applicable Draw Down Exercise Date, the trade price of a share of our common stock must not have declined more than 7.0% from an intraday high to an intraday low during such trading day. We are prohibited from issuing a Draw Down Notice if (i) the amount requested in such Draw Down Notice exceeds the Maximum Regular Draw Down Amount, in the case of a Regular Draw Down Notice, or exceeds the Maximum Fixed Draw Down Amount, in the case of a Fixed Draw Down Notice, (ii) the sale of Shares pursuant to such Draw Down Notice would cause us to issue or sell or Hanover to acquire or purchase an aggregate dollar value of Shares that would exceed the Total Commitment, or (iii) the sale of Shares pursuant to the Draw Down Notice would cause us to sell or Hanover to purchase an aggregate number of shares of our common stock which would result in beneficial ownership by Hanover of more than 9.99% of our common stock (as calculated pursuant to Section 13(d) of the Exchange Act, and the rules and regulations thereunder). With respect to a draw down pursuant to a Regular Draw Down Notice, we cannot make more than one draw down (whether pursuant to a Fixed Draw Down Notice or a Regular Draw Down Notice) in any Pricing Period and must allow 24 hours to elapse between the completion of the settlement of any one draw down pursuant to a Regular Draw Down Notice and the delivery of any Fixed Draw Down Notice or Regular Draw Down Notice for any other draw down. With respect to a draw down pursuant to a Fixed Draw Down Notice, we must allow 11 trading days to elapse between the completion of the settlement of any one draw down pursuant to a Fixed Draw Down Notice and the delivery of any Fixed Draw Down Notice or Regular Draw Down Notice for any other draw down. The Purchase Agreement contains customary representations, warranties and covenants by, among and for the benefit of the parties. The Purchase Agreement may be terminated at any time by the mutual written consent of the parties. Unless earlier terminated, the Purchase Agreement will terminate automatically on the earliest to occur of (i) the first day of the month next following the 24-month anniversary of the date on which the registration statement of which this prospectus is a part is declared effective by the Commission, (ii) the date on which Hanover purchases the Total Commitment worth of common stock under the Purchase Agreement and (iii) the date on which our common stock ceases to be listed or quoted on an eligible trading market under the Purchase Agreement. Under certain circumstances set forth in the Purchase Agreement, we and Hanover each may terminate the Purchase Agreement on one trading day s prior written notice to the other, without fee, penalty or cost. We paid to Hanover a commitment fee for entering into the Purchase Agreement equal to $150,000 (or 5.0% of the Total Commitment under the Purchase Agreement) in the form of 2,065,177 restricted shares of our common stock, which we refer to as the Initial Commitment Shares, calculated using a per share price of $$0.072633, representing the arithmetic average of the three lowest VWAPs during the 10-trading day period immediately preceding the Closing Date. In addition, promptly following the effective date of the registration statement of which this prospectus is a part, we are required to issue to Hanover additional shares of our common stock, which we refer to as the Additional Commitment Shares, equal to the greater of (i) zero and (ii) the difference of (a) the quotient of (x) $150,000 divided by (y) the greater of (1) the lowest trade price of a share of our common stock during the period beginning two trading days immediately preceding the effective date of the registration statement of which this prospectus is a part and ending on such effective date and (2) $0.04, less (ii) 2,065,177, provided that in no event will we issue more than an aggregate of 3,750,000 shares of our common stock, subject to adjustment for any stock splits, stock combinations, stock dividends, recapitalizations and other similar transactions, as Additional Commitment Shares. The Initial Commitment Shares, together with 3,750,000 Additional Commitment Shares, are being registered for resale in the registration statement of which this prospectus is a part. We sometimes in this prospectus refer to the Initial Commitment Shares and the Additional Commitment Shares, collectively, as the Commitment Shares. We also agreed to pay an initial fee of $4,250 to Garden State Securities upon the execution of the transaction documents, and an amount equal to 2.5% of the proceeds of each draw down under the Purchase Agreement for its services in acting as placement agent in connection with the transaction. Further, if we issue a Draw Down Notice and fail to deliver the shares to Hanover on the applicable settlement date, we agreed to pay Hanover, in addition to all other remedies available to Hanover under the Purchase Agreement, an amount in cash equal to 2.0% of the purchase price of such shares for each 30-day period the shares are not delivered, plus accrued interest. The Purchase Agreement also provides for indemnification of Hanover and its affiliates in the event that Hanover incurs losses, liabilities, obligations, claims, contingencies, damages, costs and expenses related to a breach by us of any of our representations and warranties under the Purchase Agreement or the other related transaction documents or any action instituted against Hanover or its affiliates due to the transactions contemplated by the Purchase Agreement or other transaction documents, subject to certain limitations. There can be no assurance that we will be able to receive all or any of the Total Commitment from Hanover because the Purchase Agreement contains certain limitations, restrictions, requirements, conditions and other provisions that could limit our ability to cause Hanover to buy common stock from us. For instance, we are prohibited from issuing a Draw Down Notice if the amount requested in such Draw Down Notice exceeds the Maximum Regular Draw Down Amount, in the case of a Regular Draw Down Notice, or exceeds the Maximum Fixed Draw Down Amount, in the case of a Fixed Draw Down Notice, or the sale of Shares pursuant to the Draw Down Notice would cause us to sell or Hanover to purchase an aggregate number of shares of the Company s common stock which would result in beneficial ownership by Hanover of more than 9.99% of our common stock (as calculated pursuant to Section 13(d) of the Exchange Act and the rules and regulations thereunder). Moreover, there are limitations with respect to the frequency with which we may provide Draw Down Notices to Hanover under the Purchase Agreement. Also, there must be an effective registration statement covering the resale of any Shares to be issued pursuant to any draw down under the Purchase Agreement, and the registration statement of which this prospectus is a part covers the resale of only 9,600,000 Shares that may be issuable pursuant to draw downs under the Purchase Agreement. These registration statements may be subject to review and comment by the staff of the Commission, and will require the consent of our independent registered public accounting firm. Therefore, the timing of effectiveness of these registration statements cannot be assured. If the market price of our common stock decreases (whether such decrease is due to sales by Hanover in the market or otherwise) and, in turn, the purchase price of our common stock sold to Hanover under the Purchase Agreement decreases, this could allow Hanover to receive greater numbers of shares of our common stock pursuant to draw downs under the Purchase Agreement. Although the number of shares of our common stock that our existing stockholders own will not decrease, the common stock owned by our existing stockholders will represent a smaller percentage of our total outstanding shares after any such sales to Hanover. Depending on market liquidity at the time, the sale of a substantial number of shares of our common stock to Hanover at a discount to the then-prevailing market price for our common stock under the Purchase Agreement, and the resale of such shares by Hanover into the public market, or the perception that such sales may occur, could cause the trading price of our common stock to decline, result in substantial dilution to existing stockholders and make it more difficult for us to sell equity or equity-related securities in the future at a time and at a price that we might otherwise wish to effect sales. Furthermore, the sale of a substantial number of shares of our common stock to Hanover and the resale of such shares by Hanover into the public market may have possible anti-takeover effects. The additional shares issued and resold could discourage persons from attempting to gain control of the Company by diluting the voting power of shares then outstanding or increasing the voting power of persons that would support the board of directors in a potential takeover situation, including by preventing or delaying a proposed business combination that is opposed by the board of directors although perceived to be desirable by some shareholders. Registration Rights Agreement In connection with the execution of the Purchase Agreement, on the Closing Date, we and Hanover also entered into a registration rights agreement dated as of the Closing Date, which we refer to as the Registration Rights Agreement. Pursuant to the Registration Rights Agreement, we agreed to file the registration statement of which this prospectus is a part with the Commission to register for resale 19,338,254 shares of our common stock, which includes the 2,065,177 Initial Commitment Shares and 3,750,000 Additional Commitment Shares, on or prior to March 28, 2014, which we refer to as the Filing Deadline, and have it declared effective at the earlier of (A) the 90th calendar day after the earlier of (1) the Filing Deadline and (2) the date on which the registration statement of which this prospectus is a part is filed with the Commission and (B) the fifth business day after the date the Company is notified by the Commission that the registration statement will not be reviewed or will not be subject to further review, which we refer to as the Effectiveness Deadline. The effectiveness of the registration statement of which this prospectus is a part is a condition precedent to our ability to sell common stock to Hanover under the Purchase Agreement. We have agreed to file with the Commission one or more additional registration statements to cover all of the securities required to be registered under the Registration Rights Agreement that are not covered by this prospectus, in each case, as soon as practicable, but in no event later than the applicable filing deadline for such additional registration statements as provided in the Registration Rights Agreement. We also agreed, among other things, to indemnify Hanover from certain liabilities and fees and expenses of Hanover incident to our obligations under the Registration Rights Agreement, including certain liabilities under the Securities Act. Hanover has agreed to indemnify and hold harmless us and each of our directors, officers and persons who control us against certain liabilities that may be based upon written information furnished by Hanover to us for inclusion in the registration statement of which this prospectus is a part, including certain liabilities under the Securities Act. The Offering As of March 31, 2014, there were 73,631,278 shares of our common stock outstanding, of which 64,066,101 shares were held by non-affiliates, excluding the 2,065,177 Initial Commitment Shares that we have already issued to Hanover under the Purchase Agreement. Although the Purchase Agreement provides that we may sell up to $3,000,000 of our common stock to Hanover, only 21,338,254 shares of our common stock are being offered under this prospectus, which represents (i) 3,923,077 shares of common stock that may be issued to Hanover upon conversion of the Convertible Note, (ii) 2,065,177 shares of common stock that we issued to Hanover as Initial Commitment Shares, (iii) a maximum of 3,750,000 shares of common stock that we may be required to issue to Hanover as Additional Commitment Shares (iv) 9,600,000 shares of common stock that we may issue to Hanover as Shares pursuant to draw downs under the Purchase Agreement, and (v) 2,000,000 shares of common stock held by our current directors and officers. If all of the 21,338,254 shares offered under this prospectus were issued and outstanding as of March 31, 2014, such shares would represent approximately 22.47% of the total number of shares of our common stock outstanding and 33.34% of the total number of outstanding shares of our common stock held by non-affiliates, in each case as of March 31, 2014. At an assumed purchase price of $0.057 (equal to 95.0% of the closing price of our common stock of $0.06 on March 31, 2014), and assuming the sale by us to Hanover of all of the 9,600,000 Shares, or approximately 13.04% of our issued and outstanding common stock, being registered hereunder pursuant to draw downs under the Purchase Agreement, we would receive only approximately $547,200 in gross proceeds. Furthermore, we may receive substantially less than $547,200 in gross proceeds from the financing due to our share price, discount to market and other factors relating to our common stock. If we elect to issue and sell more than the 9,600,000 Shares offered under this prospectus to Hanover, which we have the right, but not the obligation, to do, we must first register for resale under the Securities Act any such additional Shares, which could cause additional substantial dilution to our stockholders. Based on the above assumptions, we would be required to register an additional approximately 43,031,578 shares of our common stock to obtain the balance of $3,000,000 of the Total Commitment that would be available to us under the Purchase Agreement. We currently have authorized and available for issuance 300,000,000 shares of our common stock pursuant to our charter. The number of shares of our common stock ultimately offered for resale by Hanover is dependent upon a number of factors, including the extent to which Hanover converts the Convertible Note into shares of our common stock and the number of Shares we ultimately issue and sell to Hanover under the Purchase Agreement. The Total Commitment of $3,000,000 was determined based on numerous factors, including our estimated operating and exploration expenses for the next 3 years. While it is difficult to estimate the likelihood that we will need the full Total Commitment, we presently believe that we may need the full Total Commitment under the Purchase Agreement. Common stock offered by Selling Stockholders 21,338,254 shares of common stock, consisting of: 3,923,077 shares of common stock that we may issue to Hanover upon conversion of the Convertible Note; 2,065,177 shares of common stock that we issued to Hanover as Initial Commitment Shares; a maximum of 3,750,000 shares of common stock that we may be required to issue to Hanover as Additional Commitment Shares; 9,600,000 shares of common stock that we may issue to Hanover as Shares pursuant to draw downs under the Purchase Agreement; and 2,000,000 shares of common stock held by current directors of the Company. Common stock outstanding before the offering 73,631,278 shares of common stock. Common stock outstanding after the offering 90,904,355 shares of common stock. Use of proceeds We will not receive any proceeds from the sale of shares by the selling stockholders. However, we have received gross proceeds of $85,000 from the sale of the Convertible Note to Hanover and we may receive gross proceeds of up to $3,000,000 from the sale of Shares to Hanover pursuant to the Purchase Agreement. The net proceeds received from the sale of the Convertible Note to Hanover and from the sale of Shares pursuant to the Purchase Agreement will be used for general corporate and working capital purposes and acquisitions or assets, businesses or operations or for other purposes that our Board of Directors, in its good faith deem to be in the best interest of the company and its stockholders. OTCQB Trading Symbol TUNG Risk Factors The common stock offered hereby involves a high degree of risk and should not be purchased by investors who cannot afford the loss of their entire investment. See "Risk Factors". SUMMARY OF FINANCIAL INFORMATION The following selected financial information is derived from the Company s Financial Statements appearing elsewhere in this Prospectus and should be read in conjunction with the Company s Financial Statements, including the notes thereto, appearing elsewhere in this Prospectus. Summary of Statements of Operations Year Ended January 31, 2014 Year Ended January 31, 2013 Total Revenue $0 $0 Net loss $(1,481,142) $(23,391) Net loss per common share (basic and diluted) $(0.03) $(0.00) Weighted average common shares 56,724,275 3,000,000 Statement of Financial Position As of January 31, 2014 As of January 31, 2013 Cash $27,007 $7,163 Total current assets $35,318 $7,163 Total assets $209,331 $28,454 Total current liabilities $347,080 $51,844 Stockholders equity (deficit) $(137,749) $(23,390) Total liabilities and stockholders deficit $209,331 $28,454 DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS Except for statements of historical facts, this Prospectus contains forward-looking statements involving risks and uncertainties. The words "anticipate," "believe," "estimate," "expect," "future," "intend," "plan" or the negative of these terms and similar expressions or variations thereof are intended to forward looking statements. Such statements reflect the current view of the Registrant with respect to future events and are subject to risks, uncertainties, assumptions and other factors (including the risks contained in the section of this registration statement on Form S-1 entitled "Risk Factors") relating to the Registrant s industry, the Registrant s operations and results of operations and any businesses that may be acquired by the Registrant. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended or planned. Although the Registrant believes that the expectations reflected in the forward looking statements are reasonable, the Registrant cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including the securities laws of the United States, the Registrant does not intend to update any of the forward-looking statements to conform these statements to actual results. The following discussion should be read in conjunction with the Registrant s financial statements and the related notes included in this registration statement on Form S-1. RISK FACTORS You should carefully consider the risks described below together with all of the other information included in our public filings before making an investment decision with regard to our securities. The statements contained in or incorporated into this registration statement on Form S-1 that are not historic facts are forward-looking statements that are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in or implied by forward-looking statements. While the risks described below are the ones we believe are most important for you to consider, these risks are not the only ones that we face. If any of the following events described in these risk factors actually occurs, our business, financial condition or results of operations could be harmed. In that case, the trading price of our common stock could decline, and you may lose all or part of your investment. Funding from our Purchase Agreement with Hanover may be limited or insufficient to fund our operations or to implement our strategy. Under our Purchase Agreement with Hanover, upon effectiveness of the registration statement of which this prospectus is a part, and subject to other conditions, we may direct Hanover to purchase up to $3,000,000 of our shares of common stock over a 24-month period. Although the Purchase Agreement provides that we may sell up to $3,000,000 of our common stock to Hanover, only 19,338,254 shares of our common stock are being offered under this prospectus in connection with Hanover, which represents (i) 3,923,077 shares of common stock that may be issued to Hanover upon conversion of the Convertible Note, (ii) 2,065,177 shares of common stock that we issued to Hanover as Initial Commitment Shares, (iii) a maximum of 3,750,000 shares of common stock that we may be required to issue to Hanover as Additional Commitment Shares and (iv) 9,600,000 shares of common stock that we may issue to Hanover as Shares pursuant to draw downs under the Purchase Agreement. At an assumed purchase price of $0.057 (equal to 95.0% of the closing price of our common stock of $0.06 on March 31, 2014), and assuming the sale by us to Hanover of all of the 9,600,000 Shares, or approximately 13.04% of our issued and outstanding common stock, being registered hereunder pursuant to draw downs under the Purchase Agreement, we would receive only approximately $547,200 in gross proceeds. Furthermore, we may receive substantially less than $547,200 in gross proceeds from the financing due to our share price, discount to market and other factors relating to our common stock. If we elect to issue and sell more than the 9,600,000 Shares offered under this prospectus to Hanover, which we have the right, but not the obligation, to do, we must first register for resale under the Securities Act any such additional Shares, which could cause additional substantial dilution to our stockholders. Based on the above assumptions, we would be required to register an additional approximately 43,031,578 shares of our common stock to obtain the balance of $3,000,000 of the Total Commitment that would be available to us under the Purchase Agreement. We currently have authorized and available for issuance 300,000,000 shares of our common stock pursuant to our charter. Depending on the price at which the Shares are ultimately sold, we may have to increase the number of our authorized shares in order to issue Shares. There can be no assurance that we will be able to receive all or any of the Total Commitment from Hanover because the Purchase Agreement contains certain limitations, restrictions, requirements, conditions and other provisions that could limit our ability to cause Hanover to buy common stock from us. For instance, we are prohibited from issuing a Draw Down Notice if the amount requested in such Draw Down Notice exceeds the Maximum Regular Draw Down Amount, in the case of a Regular Draw Down Notice, or exceeds the Maximum Fixed Draw Down Amount, in the case of a Fixed Draw Down Notice, or the sale of Shares pursuant to the Draw Down Notice would cause us to sell or Hanover to purchase an aggregate number of shares of the Company s common stock which would result in beneficial ownership by Hanover of more than 9.99% of our common stock (as calculated pursuant to Section 13(d) of the Exchange Act and the rules and regulations thereunder). Moreover, there are limitations with respect to the frequency with which we may provide Draw Down Notices to Hanover under the Purchase Agreement. Also, as discussed above, there must be an effective registration statement covering the resale of any Shares to be issued pursuant to any draw down under the Purchase Agreement, and the registration statement of which this prospectus is a part covers the resale of only 9,600,000 Shares that may be issuable pursuant to draw downs under the Purchase Agreement. These registration statements may be subject to review and comment by the staff of the Commission, and will require the consent of our independent registered public accounting firm. Therefore, the timing of effectiveness of these registration statements cannot be assured. The extent to which we rely on Hanover as a source of funding will depend on a number of factors, including the amount of working capital needed, the prevailing market price of our common stock and the extent to which we are able to secure working capital from other sources. If obtaining sufficient funding from Hanover were to prove unavailable or prohibitively dilutive, we would need to secure another source of funding. Even if we sell all $3,000,000 of common stock under the Purchase Agreement with Hanover, we will still need additional capital to fully implement our current business, operating plans and development plans. The sale or issuance of our common stock to Hanover at a discount may cause substantial dilution and the resale of the shares of common stock by Hanover into the public market, or the perception that such sales may occur, could cause the price of our common stock to fall. Under the Purchase Agreement with Hanover, upon effectiveness of the registration statement of which this prospectus is a part, and subject to other conditions, we may direct Hanover to purchase up to $3,000,000 of our shares of common stock over a 24-month period. We are registering an aggregate of 19,338,254 shares of common stock in the registration statement of which this prospectus is a part pursuant to the Registration Rights Agreement and the Note Registration Rights Agreement. Notwithstanding Hanover s beneficial ownership limitation set forth in the Purchase Agreement, if all of the 19,338,254 shares offered under this prospectus in connection with Hanover were issued and outstanding as of March 31, 2014, such shares would represent approximately 22.47% of the total number of shares of our common stock outstanding and 33.34% of the total number of outstanding shares of our common stock held by non-affiliates, in each case as of March 31, 2014. The number of shares ultimately offered for sale by Hanover under this prospectus is dependent upon a number of factors, including the extent to which Hanover converts the Convertible Note into shares of our common stock and the number of Shares we ultimately issue and sell to Hanover under the Purchase Agreement. Because the actual purchase price for the Shares that we may sell to Hanover will fluctuate based on the market price of our common stock during the term of the Purchase Agreement, we are not able to determine at this time the exact number of shares of our common stock that we will issue under the Purchase Agreement and, therefore, the exact number of shares we will ultimately register for resale under the Securities Act. Specifically, because the per share purchase price for the Shares subject to a Regular Draw Down Notice will be equal to 95.0% of the arithmetic average of the VWAPs over a certain number of trading days during the applicable Pricing Period as set forth in the Purchase Agreement, Hanover will pay less than the then-prevailing market price for the Shares subject to a Regular Draw Down Notice, and the actual purchase price for the Shares that we may sell to Hanover pursuant to a Regular Draw Down Notice will fluctuate based on the VWAP of our common stock during the term of the Purchase Agreement. Similarly, because the per share purchase price for the Shares subject to a Fixed Draw Down Notice will be equal to 90.0% of the lower of (i) the lowest trade price of a share of our common stock on the applicable Draw Down Exercise Date, and (ii) the arithmetic average of the three lowest daily VWAPs during the 10 consecutive trading days ending on the trading day immediately preceding the applicable Draw Down Exercise Date, it is also possible that Hanover will pay less than the then-prevailing market price for the Shares subject to a Fixed Draw Down Notice, and the actual purchase price for the Shares that we may sell to Hanover pursuant to a Fixed Draw Down Notice will fluctuate based on the market price of our common stock during the term of the Purchase Agreement. As a result of this discount, Hanover may have a financial incentive to sell our common stock immediately to realize the profit equal to the difference between the purchase price and the market price. If Hanover sells the common stock, the market price of our common stock could decrease. If the market price of our common stock decreases, Hanover may have a further incentive to sell the common stock that it holds. These sales may have a further impact on the market price of our common stock. Moreover, there is an inverse relationship between the market price of our common stock and the number of shares of our common stock that may be sold pursuant to the Purchase Agreement. That is, the lower the market price, the more shares of our common stock that may be sold under the Purchase Agreement. Accordingly, if the market price of our common stock decreases (whether such decrease is due to sales by Hanover in the market or otherwise) and, in turn, the purchase price of our common stock sold to Hanover under the Purchase Agreement decreases, this could allow Hanover to receive greater numbers of shares of our common stock pursuant to draw downs under the Purchase Agreement. Although the number of shares of our common stock that our existing stockholders own will not decrease, the common stock owned by our existing stockholders will represent a smaller percentage of our total outstanding shares after any such sales to Hanover. Depending on market liquidity at the time, the sale of a substantial number of shares of our common stock to Hanover at a discount to the then-prevailing market price for our common stock under the Purchase Agreement, and the resale of such shares by Hanover into the public market, or the perception that such sales may occur, could cause the trading price of our common stock to decline, result in substantial dilution to existing stockholders and make it more difficult for us to sell equity or equity-related securities in the future at a time and at a price that we might otherwise wish to effect sales. For a tabular disclosure of the number of securities and percentage ownership to be issued assuming we sell all the securities on the registration statement and assuming sales to Hanover at various discounts to our current market price, please see the section entitled "Equity Enhancement Program With Hanover" in this prospectus. The covenants included in the Purchase Agreement and the Convertible Note may restrict our ability to obtain additional financing. The terms of the Purchase Agreement and the Convertible Note include certain covenants which may restrict our ability to obtain additional financing. For example, until the Convertible Note has been converted, redeemed or otherwise satisfied, the Company is restricted from repaying any indebtedness if such payment would cause an event of default or issuing any securities without the consent of Hanover that may cause a breach or default under the Convertible Note. Additionally, if the Company issues or sells shares of common stock for a consideration per share less than or equal to the conversion price of the Convertible Note, the conversion price of the Convertible Note will be reduced to an amount equal to such lower price. In order to fully implement our business plan, we will need additional sources of financing beyond what is currently available through the Purchase Agreement and the restrictions imposed by under the Purchase Agreement and the Convertible Note will limit our ability to enter into certain financing arrangements. You may experience immediate and substantial dilution in the net tangible book value per share of the common stock you purchase. The price per share of our common stock being offered pursuant to this prospectus may be substantially higher than the net tangible book value per share of our common stock. Therefore, if you purchase shares of common stock in this offering at the current market value, you may suffer immediate and substantial dilution in the pro forma net tangible book value per share of common stock. See the section entitled "Dilution" elsewhere in this prospectus for a more detailed discussion of the dilution you may incur if you purchase shares in this offering. We may use the net proceeds from sales of our common stock to Hanover pursuant to the Purchase Agreement in ways with which you may disagree. We intend to use the net proceeds from sales of our common stock to Hanover pursuant to the Purchase Agreement for working capital and general corporate purposes. As of the date of this prospectus, we cannot specify with certainty all of the particular uses of the proceeds from sales of common stock to Hanover pursuant to the Purchase Agreement. Accordingly, we will have significant discretion in the use of the net proceeds of sales of common stock to Hanover pursuant to the Purchase Agreement. It is possible that we may allocate the proceeds differently than investors in this offering desire or that we will fail to maximize our return on these proceeds. We may, subsequent to this offering, modify our intended use of the proceeds from sales of common stock to Hanover pursuant to the Purchase Agreement to pursue strategic opportunities that may arise, such as potential acquisition opportunities. You will be relying on the judgment of our management with regard to the use of the net proceeds from the sales of common stock to Hanover pursuant to the Purchase Agreement, and you will not have the opportunity, as part of your investment decision, to assess whether the proceeds are being used appropriately. Any failure to apply the proceeds from sales of common stock to Hanover pursuant to the Purchase Agreement effectively could have a material adverse effect on our business and cause a decline in the market price of our common stock. The sale or issuance of our common stock to Hanover could affect our ability to be eligible for the OTCQB marketplace operated by OTC Markets Group, Inc. In order to be eligible for the OTCQB marketplace operated by OTC Markets Group, Inc. ("OTCQB") for over-the-counter ("OTC") traded companies, a company must meet a minimum bid price test of $0.01, or risk being downgraded to the OTC Pink marketplace, operated by OTC Markets Group, Inc. ("OTC Pink"). Depending on market liquidity at the time, the sale of a substantial number of shares of our common stock to Hanover at a discount to the then-prevailing market price for our common stock under the Purchase Agreement, and the resale of such shares by Hanover into the public market, or the perception that such sales may occur, could cause the trading price of our common stock to decline, which may result in the Company not being eligible for the OTCQB. As a result, the market liquidity for our securities could be severely adversely affected by limiting the ability of broker-dealers to sell our securities and the ability of stockholders to sell their securities in the secondary market. Risks Associated With Mining Our property is in the exploration stage. There is no assurance that we can establish the existence of any mineral resource on our property in commercially exploitable quantities. Until we can do so, we cannot earn any revenues from operations and if we do not do so we will lose all of the funds that we expend on exploration. If we do not discover any mineral resource in a commercially exploitable quantity, our business could fail. Despite past production on our mineral property, we have not established that it contains any mineral reserve, nor can there be any assurance that we will be able to do so. If we do not, our business could fail. A mineral reserve is defined by the Securities and Exchange Commission in its Industry Guide 7 (which can be viewed over the Internet at http://www.sec.gov/divisions/corpfin/forms/industry.htm#secguide7) as that part of a mineral deposit which could be economically and legally extracted or produced at the time of the reserve determination. The probability of an individual prospect ever having a "reserve" that meets the requirements of the Securities and Exchange Commission's Industry Guide 7 is extremely remote; in all probability our mineral resource property does not contain any 'reserve' and any funds that we spend on exploration will probably be lost. Even if we do eventually discover a mineral reserve on our property, there can be no assurance that we will be able to develop our property into a producing mine and extract those resources. Both mineral exploration and development involve a high degree of risk and few properties which are explored are ultimately developed into producing mines. The commercial viability of an established mineral deposit will depend on a number of factors including, by way of example, the size, grade and other attributes of the mineral deposit, the proximity of the resource to infrastructure such as a smelter, roads and a point for shipping, government regulation and market prices. Most of these factors will be beyond our control, and any of them could increase costs and make extraction of any identified mineral resource unprofitable. Mineral operations are subject to applicable law and government regulation. Even if we discover a mineral resource in a commercially exploitable quantity, these laws and regulations could restrict or prohibit the exploitation of that mineral resource. If we cannot exploit any mineral resource that we might discover on our property, our business may fail. Both mineral exploration and extraction require permits from various foreign, federal, state, provincial and local governmental authorities and are governed by laws and regulations, including those with respect to prospecting, mine development, mineral production, transport, export, taxation, labor standards, occupational health, waste disposal, toxic substances, land use, environmental protection, mine safety and other matters. There can be no assurance that we will be able to obtain or maintain any of the permits required for the continued exploration of our mineral properties or for the construction and operation of a mine on our properties at economically viable costs. If we cannot accomplish these objectives, our business could fail. We believe that we are in compliance with all material laws and regulations that currently apply to our activities but there can be no assurance that we can continue to remain in compliance. Current laws and regulations could be amended and we might not be able to comply with them, as amended. Further, there can be no assurance that we will be able to obtain or maintain all permits necessary for our future operations, or that we will be able to obtain them on reasonable terms. To the extent such approvals are required and are not obtained, we may be delayed or prohibited from proceeding with planned exploration or development of our mineral properties. If we establish the existence of a mineral resource on our property in a commercially exploitable quantity, we will require additional capital in order to develop the property into a producing mine. If we cannot raise this additional capital, we will not be able to exploit the resource, and our business could fail. If we do discover mineral resources in commercially exploitable quantities on our property, we will be required to expend substantial sums of money to establish the extent of the resource, develop processes to extract it and develop extraction and processing facilities and infrastructure. Although we may derive substantial benefits from the discovery of a major deposit, there can be no assurance that such a resource will be large enough to justify commercial operations, nor can there be any assurance that we will be able to raise the funds required for development on a timely basis. If we cannot raise the necessary capital or complete the necessary facilities and infrastructure, our business may fail. Mineral exploration and development is subject to extraordinary operating risks. We do not currently insure against these risks. In the event of a cave-in or similar occurrence, our liability may exceed our resources, which would have an adverse impact on our company. Mineral exploration, development and production involve many risks which even a combination of experience, knowledge and careful evaluation may not be able to overcome. Our operations will be subject to all the hazards and risks inherent in the exploration for mineral resources and, if we discover a mineral resource in commercially exploitable quantity, our operations could be subject to all of the hazards and risks inherent in the development and production of resources, including liability for pollution, cave-ins or similar hazards against which we cannot insure or against which we may elect not to insure. Any such event could result in work stoppages and damage to property, including damage to the environment. We do not currently maintain any insurance coverage against these operating hazards. The payment of any liabilities that arise from any such occurrence would have a material adverse impact on our company. Mineral prices are subject to dramatic and unpredictable fluctuations. We expect to derive revenues, if any, either from the sale of our mineral rights or from the extraction and sale of ore. The price of those commodities has fluctuated widely in recent years, and is affected by numerous factors beyond our control, including international, economic and political trends, expectations of inflation, currency exchange fluctuations, interest rates, global or regional consumptive patterns, speculative activities and increased production due to new extraction developments and improved extraction and production methods. The effect of these factors on the price of base and precious metals, and therefore the economic viability of any of our exploration properties and projects, cannot accurately be predicted. The mining industry is highly competitive and there is no assurance that we will continue to be successful in acquiring mineral claims. If we cannot continue to acquire properties to explore for mineral resources, we may be required to reduce or cease operations. The mineral exploration, development, and production industry is largely un-integrated. In identifying and acquiring mineral resource properties, we compete with many companies possessing greater financial resources and technical facilities. This competition could adversely affect our ability to acquire suitable prospects for exploration in the future. Accordingly, there can be no assurance that we will acquire any interest in additional mineral resource properties that might yield reserves or result in commercial mining operations. An adequate supply of water may not be available to undertake mining and production at our property. The amount of water that we are entitled to use from wells must be determined by the appropriate regulatory authorities. A determination of these rights is dependent in part on our ability to demonstrate a beneficial use for the amount of water that we intend to use. Unless we are successful in developing a property to a point where it can commence commercial production of tungsten or other precious metals, we may not be able to demonstrate such beneficial use. Accordingly, there is no assurance that we will have access to the amount of water needed to operate a mine at our property. Title to mineral properties can be uncertain and we are at risk of loss of ownership of our property. Our ability to explore and operate our property depends on the validity of title to that property. Unpatented mining claims provide only possessory title and their validity is often subject to contest by third parties or the federal government, which makes the validity of unpatented mining claims uncertain and generally more risky. These uncertainties relate to such things as the sufficiency of mineral discovery, proper posting and marking of boundaries, assessment work, and possible conflicts with other claims not determinable from descriptions of record. We have not obtained a title opinion on any of our properties, with the attendant risk that title to some claims, particularly title to undeveloped property, may be defective. There may be valid challenges to the title to our property which, if successful, could impair development and/or operations. We remain at risk that the mining claims may be forfeited either to the United States or to rival private claimants due to failure to comply with statutory requirements as to location and maintenance of the claims or challenges to whether a discovery of a valuable mineral exists on every claim. Government regulation may adversely affect our business and planned operations. Mineral exploration and development activities are subject to various laws governing prospecting, development, taxes, labor standards and occupational health, mine safety, toxic substances, land use, water use, land claims of local people, and other matters. We cannot assure you that new rules and regulations will not be enacted or that existing rules and regulations will not be applied in a manner which could limit or curtail our exploration or development of our property. Our operating costs could be adversely affected by inflationary pressures especially to labor, equipment, and fuel costs. The global economy is currently experiencing a period of high commodity prices and as a result the mining industry is attempting to increase production at new and existing projects, while also seeking to discover, explore and develop new projects. This has caused significant upward price pressures in the costs of mineral exploration companies, especially in the areas of skilled labor and drilling equipment, both of which are in tight supply and whose costs are increasing. Continued upward price pressures in our exploration costs may have an adverse impact to our business. Severe weather or violent storms could materially affect our operations due to damage or delays caused by such weather. Our exploration activities are subject to normal seasonal weather conditions that often hamper and may temporarily prevent exploration activities. There is a risk that unexpectedly harsh weather or violent storms could affect areas where we conduct exploration activities. Delays or damage caused by severe weather could materially affect our operations or our financial position. Our business is dependent on key executives and the loss of any of our key executives could adversely affect our business, future operations and financial condition. We are dependent on the services of our executive officers, Guy Martin and Douglas Oliver. The foregoing officers have many years of experience and extensive backgrounds in the mining industry in general. We may not be able to replace that experience and knowledge with other individuals. We do not have "Key-Man" life insurance policies on either Mr. Martin or Mr. Oliver. The loss of any of our current executive officers or our inability to attract and retain additional highly skilled employees may adversely affect our business, future operations, and financial condition. Legislation has been proposed that could significantly affect the mining industry in the United States of America. Members of the U.S. Congress have repeatedly introduced bills which would supplant or alter the provisions of the Mining Law of 1872. If enacted, such legislation could change the cost of holding unpatented mining claims and could significantly impact our ability to develop mineralized material on unpatented mining claims. A significant portion of the present Cherry Creek Tungsten Project s land position is located on unpatented mining claims located on U.S. federal public lands. The rights to use such claims are granted under the Mining Law of 1872. Unpatented mining claims are unique property interests in the United States, and are generally considered to be subject to greater title risk than other real property interests because the validity of unpatented mining claims is often uncertain. This uncertainty arises, in part, out of the complex federal and state laws and regulations under the 1872 Mining Law and the interaction of the 1872 Mining Law and other federal and state laws, such as those enacted for the protection of the environment. In recent years, the U.S. Congress has considered a number of proposed amendments to the 1872 Mining Law. If adopted, such legislation could, among other things: impose a royalty on the production of metals or minerals from unpatented mining claims; reduce or prohibit the ability of a mining company to expand its operations; and require a material change in the method of exploiting the reserves located on unpatented mining claims. All of the foregoing could adversely affect the economic and financial viability of future mining operations at the Cherry Creek Tungsten Project. Although it is impossible to predict at this point what any legislated royalties might be, enactment could adversely affect the potential for development of such federal unpatented mining claims. Amendments to current laws, regulations, and permits governing operations and activities of mining and exploration companies, or more stringent implementation thereof, could have a material adverse impact on our business and cause increases in exploration expenses, capital expenditures, or production costs or reduction in levels of production at producing properties or require abandonment or delays in development of new mining properties. Fluctuating tungsten prices could negatively impact our business plan. The potential for profitability of our tungsten mining operations and the value of our mining properties are directly related to the market price of tungsten. Tungsten is typically priced according to metric ton units (mtu) of Ammonium Paratungstate (APT), which is equal to 10 kg. 1 MTU of APT contains approximately 7.93kgs of tungsten. APT and concentrate prices are mainly based on quotations published twice weekly by London's metal bulletin and other trade journals (ITIA). The price of tungsten may have a significant influence on the market price of our shares. If we obtain positive drill results and progress our property to a point where a commercial production decision can be made, our decision to put a mine into production and to commit the funds necessary for that purpose must be made long before any revenue from production would be received. A decrease in the price of tungsten at any time during future exploration and development may prevent our property from being economically mined or result in the write-off of assets whose value is impaired as a result of lower tungsten prices. The price of tungsten is affected by numerous factors beyond our control, including inflation, fluctuation of the United States dollar and foreign currencies, global and regional demand, and the political and economic conditions of major tungsten producing countries throughout the world. The volatility of mineral prices represents a substantial risk which no amount of planning or technical expertise can fully eliminate. In the event tungsten prices decline and remain low for prolonged periods of time, we might be unable to develop our properties or produce any revenue. The volatility in tungsten prices is illustrated by the following table, which sets forth, for the periods indicated (calendar year), the quotations published by London s "Metal Bulletin" as reproduced by the International Tungsten Industry Association. Source – http://www.itia.info/tungsten-prices.html The US APT quotation (stu) and the FeW quotation have been converted to mtu of WO3 to facilitate price comparisons and the annual averages have been calculated by ITIA. A metric ton unit (mtu) is 10kg. A metric ton unit of tungsten trioxide (WO3) contains 7.93kgs of tungsten. A short ton unit (stu) is 20 pounds. Estimates of mineralized materials are subject to geologic uncertainty and inherent sample variability. Although the estimated resources at our existing property will be delineated with appropriately spaced drilling, there is inherent variability between duplicate samples taken adjacent to each other and between sampling points that cannot be reasonably eliminated. There also may be unknown geologic details that have not been identified or correctly appreciated at the proposed level of delineation. This results in uncertainties that cannot be reasonably eliminated from the estimation process. Some of the resulting variances can have a positive effect and others can have a negative effect on mining and processing operations. Acceptance of these uncertainties is part of any mining operation. Risks Related To Our Company The fact that we have not earned any operating revenues since our inception raises substantial doubt about our ability to continue to explore our mineral properties as a going concern. We have not generated any revenue from operations since our inception and we anticipate that we will continue to incur operating expenses without revenues unless and until we are able to identify a mineral resource in a commercially exploitable quantity on our mineral property and we build and operate a mine. We had cash in the amount of $27,007 as of January 31, 2014. As of January 31, 2014, we had working capital deficit of $311,762. We incurred a net loss of $1,504,533 since inception. We estimate our average monthly operating expenses to be approximately $35,000, including mineral property costs, management services and administrative costs. Should the results of our planned exploration require us to increase our current operating budget, we may have to raise additional funds to meet our currently budgeted operating requirements for the next 12 months. As we cannot assure a lender that we will be able to successfully explore and develop our mineral property, we will probably find it difficult to raise debt financing from traditional lending sources. We have traditionally raised our operating capital from sales of equity securities, but there can be no assurance that we will continue to be able to do so. If we cannot raise the money that we need to continue exploration of our mineral property, we may be forced to delay, scale back, or eliminate our exploration activities. If any of these were to occur, there is a substantial risk that our business would fail. These circumstances lead our independent registered public accounting firm, in their report dated March 31, 2014, to comment about the Company s ability to continue as a going concern. Our future is dependent upon our ability to obtain financing. If we do not obtain such financing, we may have to cease our exploration activities and investors could lose their entire investment. There is no assurance that we will operate profitably or generate positive cash flow in the future. We will require additional financing in order to proceed beyond the first few months of our exploration program. We will also require additional financing for the fees we must pay to maintain our status in relation to the rights to our property and to pay the fees and expenses necessary to become and operate as a public company. We will also need more funds if the costs of the exploration of our existing projects are greater than we have anticipated. We will also require additional financing to sustain our business operations if we are not successful in earning revenues. We may not be able to obtain financing on commercially reasonable terms or terms that are acceptable to us when it is required. Our future is dependent upon our ability to obtain financing. If we do not obtain such financing, our business could fail and investors could lose their entire investment. Because we may never earn revenues from our operations, our business may fail and then investors may lose all of their investment in our company. We have no history of revenues from operations. We have yet to generate positive earnings and there can be no assurance that we will ever operate profitably. Our company has a limited operating history and is in the exploration stage. The success of our company is significantly dependent on the uncertain events of the discovery and exploitation of mineral reserves on our property or selling the rights to exploit those mineral reserves. If our business plan is not successful and we are not able to operate profitably, then our stock may become worthless and investors may lose all of their investment in our company. Prior to completion of the exploration and pre-feasibility and feasibility stages, we anticipate that we will incur increased operating expenses without realizing any revenues. We therefore expect to incur significant losses into the foreseeable future. We recognize that if we are unable to generate significant revenues from the exploration of our mineral claims in the future, we will not be able to earn profits or continue operations. There is no history upon which to base any assumption as to the likelihood that we will prove successful, and we can provide no assurance that we will generate any revenues or ever achieve profitability. If we are unsuccessful in addressing these risks, our business will fail and investors may lose all of their investment in our company. We may be required to incur significant costs and require significant management resources to evaluate our internal control over financial reporting as required under Section 404 of the Sarbanes-Oxley Act, and any failure to comply or any adverse result from such evaluation may have an adverse effect on our stock price. As a smaller reporting company as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended, we are required to evaluate our internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002 ("Section 404"). Section 404 requires us to include an internal control report with our Annual Report on Form 10-K. This report must include management s assessment of the effectiveness of our internal control over financial reporting as of the end of the fiscal year. This report must also include disclosure of any material weaknesses in internal control over financial reporting that we have identified. Failure to comply, or any adverse results from such evaluation, could result in a loss of investor confidence in our financial reports and have an adverse effect on the trading price of our equity securities. Management believes that our internal controls and procedures are currently not effective to detect the inappropriate application of U.S. GAAP rules. Management realize there are deficiencies in the design or operation of our internal control that adversely affect our internal controls which management considers to be material weaknesses including those described below: 1.We have insufficient quantity of dedicated resources and experienced personnel involved in reviewing and designing internal controls. As a result, a material misstatement of the interim and annual financial statements could occur and not be prevented or detected on a timely basis. 2.We did not perform an entity level risk assessment to evaluate the implication of relevant risks on financial reporting, including the impact of potential fraud-related risks and the risks related to non-routine transactions, if any, on our internal control over financial reporting. Lack of an entity-level risk assessment constituted an internal control design deficiency which resulted in more than a remote likelihood that a material error would not have been prevented or detected, and constituted a material weakness. 3.We have not achieved the optimal level of segregation of duties relative to key financial reporting functions. Achieving continued compliance with Section 404 may require us to incur significant costs and expend significant time and management resources. We cannot assure you that we will be able to fully comply with Section 404 or that we and our independent registered public accounting firm would be able to conclude that our internal control over financial reporting is effective at fiscal year end. As a result, investors could lose confidence in our reported financial information, which could have an adverse effect on the trading price of our securities, as well as subject us to civil or criminal investigations and penalties. In addition, our independent registered public accounting firm may not agree with our management s assessment or conclude that our internal control over financial reporting is operating effectively. Risks Associated with Our Common Stock Trading on the OTCQB may be volatile and sporadic, which could depress the market price of our common stock and make it difficult for our stockholders to resell their shares. Our common stock is quoted on the OTCQB. Trading in stock quoted on the OTCQB is often thin and characterized by wide fluctuations in trading prices, due to many factors that may have little to do with our operations or business prospects. This volatility could depress the market price of our common stock for reasons unrelated to operating performance. Moreover, the OTCQB is not a stock exchange, and trading of securities on the OTCQB is often more sporadic than the trading of securities listed on a quotation system like NASDAQ or a stock exchange like NYSE Amex. Accordingly, shareholders may have difficulty reselling any of their shares. Our stock is a penny stock. Trading of our stock may be restricted by the SEC s penny stock regulations and FINRA s sales practice requirements, which may limit a stockholder s ability to buy and sell our stock. Our stock is a penny stock. The Securities and Exchange Commission has adopted Rule 15g-9 which generally defines "penny stock" to be any equity security that has a market price (as defined) less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. Our securities are covered by the penny stock rules, which impose additional sales practice requirements on broker-dealers who sell to persons other than established customers and "accredited investors". The term "accredited investor" refers generally to institutions with assets in excess of $5,000,000 or individuals with a net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouse. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document in a form prepared by the SEC which provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction and monthly account statements showing the market value of each penny stock held in the customer s account. The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer s confirmation. In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from these rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser s written agreement to the transaction. These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the stock that is subject to these penny stock rules. Consequently, these penny stock rules may affect the ability of broker-dealers to trade our securities. We believe that the penny stock rules discourage investor interest in, and limit the marketability of, our common stock. In addition to the "penny stock" rules promulgated by the Securities and Exchange Commission, the Financial Industry Regulatory Authority has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer s financial status, tax status, investment objectives and other information. Under interpretations of these rules, the Financial Industry Regulatory Authority believes that there is a high probability that speculative low-priced securities will not be suitable for at least some customers. The Financial Industry Regulatory Authority s requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock. To date, we have not paid any cash dividends and no cash dividends will be paid in the foreseeable future. We do not anticipate paying cash dividends on our common stock in the foreseeable future and we may not have sufficient funds legally available to pay dividends. Even if the funds are legally available for distribution, we may nevertheless decide not to pay any dividends. We presently intend to retain all earnings for our operations. The elimination of monetary liability against our directors, officers and employees under Nevada law and the existence of indemnification rights to our directors, officers and employees may result in substantial expenditures by our company and may discourage lawsuits against our directors, officers and employees. Our Bylaws contain a provision permitting us to indemnify our directors and executive officers, and former directors and executive officers, to the fullest extent provided by Nevada law. The foregoing indemnification obligations could result in the Company incurring substantial expenditures to cover the cost of settlement or damage awards against directors and officers, which we may be unable to recoup. These provisions and resultant costs may also discourage our company from bringing a lawsuit against directors and officers for breaches of their fiduciary duties, and may similarly discourage the filing of derivative litigation by our shareholders against our directors and officers even though such actions, if successful, might otherwise benefit our company and shareholders. The relative lack of public company experience of our management team may put us at a competitive disadvantage. Our management team does not have extensive public company experience and is generally unfamiliar with the requirements of the United States securities laws, which could impair our ability to comply with legal and regulatory requirements such as those imposed by Sarbanes-Oxley Act of 2002. The individuals who now constitute our senior management team have limited experience managing a publicly traded company. Such responsibilities include complying with federal securities laws and making required disclosures on a timely basis. Our senior management may not be able to implement programs and policies in an effective and timely manner that adequately responds to such increased legal, regulatory compliance and reporting requirements. Our failure to comply with all applicable requirements could lead to the imposition of fines and penalties and distract our management from attending to the growth of our business. If we issue additional shares in the future, whether in connection with a financing or in exchange for services or rights, it will result in the dilution of our existing stockholders. Our articles of incorporation authorize the issuance of up to 300,000,000 shares of common stock, par value $0.0001, and 25,000,000 shares of preferred stock, par value $0.0001. Our Board of Directors may choose to issue some or all of such shares to acquire one or more companies or properties, to fund our overhead and general operating requirements and in exchange for services rendered to the Company. Such issuances may not require the approval of our shareholders. Any future issuances may reduce the book value per share and may contribute to a reduction in the market price of the outstanding shares of our common stock. If we issue any such additional shares in the future, such issuance will reduce the proportionate ownership and voting power of all current shareholders. Shares of our common stock that have not been registered under the Securities Act of 1933, as amended, regardless of whether such shares are restricted or unrestricted, are subject to resale restrictions imposed by Rule 144, including those set forth in Rule 144(i) which apply to a "shell company." In addition, any shares of our common stock that are held by affiliates, including any received in a registered offering, will be subject to the resale restrictions of Rule 144(i). Pursuant to Rule 144 of the Securities Act of 1933, as amended ("Rule 144"), a "shell company" is defined as a company that has no or nominal operations; and, either no or nominal assets; assets consisting solely of cash and cash equivalents; or assets consisting of any amount of cash and cash equivalents and nominal other assets. As such, we were a "shell company" pursuant to Rule 144 prior to the consummation of the Transaction, and as such, sales of our securities pursuant to Rule 144 are not able to be made until a period of at least twelve months has elapsed from the date that a Current Report on Form 8-K has been filed with the Commission reflecting the Company s status as a non- "shell company", which was April 20, 2013. Therefore, any restricted securities we sell in the future or issue to consultants or employees, in consideration for services rendered or for any other purpose will have no liquidity until and unless such securities are registered with the Commission and/or until a year after the date of the filing of the Current Report on Form 8-K and we have otherwise complied with the other requirements of Rule 144. As a result, it may be harder for us to fund our operations and pay our consultants with our securities instead of cash. Furthermore, it will be harder for us to raise funding through the sale of debt or equity securities unless we agree to register such securities with the Commission, which could cause us to expend additional resources in the future. Our previous status as a "shell company" could prevent us from raising additional funds, engaging consultants, and using our securities to pay for any acquisitions (although none are currently planned), which could cause the value of our securities, if any, to decline in value or become worthless. Lastly, any shares held by affiliates, including shares received in any registered offering, will be subject to the resale restrictions of Rule 144(i). USE OF PROCEEDS We will not receive any proceeds from the sale of shares by the Selling Stockholders. However, we have received gross proceeds of $85,000 from the sale of the Convertible Note to Hanover and we may receive gross proceeds of up to $3,000,000 from the sale of Shares to Hanover pursuant to the Purchase Agreement. The net proceeds received from the sale of the Convertible Note to Hanover and from the sale of Shares pursuant to the Purchase Agreement will be used for general corporate and working capital purposes and acquisitions or assets, businesses or operations or for other purposes that our Board of Directors, in its good faith deem to be in the best interest of the company and its stockholders. DETERMINATION OF OFFERING PRICE There currently is a limited public market for our common stock. The Selling Stockholders will determine at what price it may sell the offered shares, and such sales may be made at prevailing market prices or at privately negotiated prices. See "Plan of Distribution" below for more information. SELLING STOCKHOLDERS This prospectus relates to the possible resale from time to time by the selling stockholders of any or all of the shares of common stock that have been or may be issued by us to Hanover under the Purchase Agreement and upon conversion of the Convertible Note, and shares of common stock held by the directors of the Company. For additional information regarding the issuance of common stock covered by this prospectus, see "Summary—Recent Developments" and "Equity Enhancement Program With Hanover" above. We are registering 19,338,254 shares of common stock pursuant to the provisions of the Note Registration Rights Agreement we entered into with Hanover on January 2, 2014 and the Registration Rights Agreement we entered into with Hanover on February 18, 2014, in order to permit Hanover to offer the shares for resale from time to time. Except for the transactions contemplated by the Convertible Note, the Note Purchase Agreement, the Note Registration Rights Agreement, the Purchase Agreement and the Registration Rights Agreement, Hanover has not had any material relationship with us within the past three years. The table below presents information regarding the selling stockholders and the shares of common stock that they may offer from time to time under this prospectus. This table is prepared based on information supplied to us by the selling stockholders, and reflects holdings as of March 31, 2014. As used in this prospectus, the term "selling stockholders" means Hanover, Guy Martin, Douglas Oliver, Joseph Galda and David Bikerman. The number of shares in the column "Maximum Number of Shares of Common Stock to be Offered Pursuant to this Prospectus" represents all of the shares of common stock that the selling stockholders may offer under this prospectus. The selling stockholders may sell some, all or none of their shares in this offering. We do not know how long the selling stockholders will hold the shares before selling them, and we currently have no agreements, arrangements or understandings with the selling stockholders regarding the sale of any of their shares. Beneficial ownership is determined in accordance with Rule 13d-3(d) promulgated by the SEC under the Exchange Act, and includes shares of common stock with respect to which the selling stockholder has voting and investment power. The percentage of shares of common stock beneficially owned by the selling stockholders prior to the offering shown in the table below is based on an aggregate of 73,631,278 shares of our common stock outstanding on March 31, 2014. Because the purchase price of the shares of common stock issuable under the Purchase Agreement is determined on each settlement date, and because the principal amount under the Convertible Note may be reduced under certain circumstances (thereby resulting in fewer shares being issued to Hanover upon conversion of the Convertible Note), the number of shares that may actually be sold by the Company under the Purchase Agreement and the number of shares that may actually be issued to Hanover upon conversion of the Convertible Note may be fewer than the number of shares being offered by this prospectus. The fourth column assumes the sale of all of the shares offered by the selling stockholders pursuant to this prospectus. Name of Selling Stockholder Number of Shares of Common Stock Owned Prior to Offering Maximum Number of Shares of Common Stock to be Offered Pursuant to this Prospectus(3) Number of Shares of Common Stock Owned After Offering Number(1) Percent(2) Number(4) Percent(5) Hanover Holdings I, LLC (6) 5,988,254 8.13 % 19,338,254 (3) 0 0 % Guy Martin(7) 3,000,000 4.07 % 800,000 2,200,000 2.42 % Douglas Oliver(8) 3,000,000 4.07 % 800,000 2,200,000 2.42 % Joseph Galda(9) 750,000 1.02 % 200,000 550,000 0.60 % David Bikerman(10) 750,000 1.02 % 200,000 550,000 0.60 % *Represents beneficial ownership of less than one percent of the outstanding shares of our common stock. (1)This number represents (i) 3,923,077 shares of common stock underlying the Convertible Note we issued to Hanover on January 2, 2014 and (ii) the 2,065,177 shares of common stock we issued to Hanover on February 18, 2014 as Initial Commitment Shares in consideration for entering into the Purchase Agreement with us. In accordance with Rule 13d-3(d) under the Exchange Act, we have excluded from the number of shares beneficially owned prior to the offering (i) up to 3,750,000 shares that may be issued to Hanover as Additional Commitment Shares under the terms of the Purchase Agreement, because the issuance of such shares is dependent on, among other things, the registration statement of which this prospectus is a part becoming effective and (ii) all of the shares that Hanover may be required to purchase pursuant to draw downs under the Purchase Agreement, because the issuance of such shares is solely at our discretion and is subject to certain conditions, the satisfaction of all of which are outside of Hanover s control, including the registration statement of which this prospectus is a part becoming and remaining effective. Furthermore, the maximum amount of each put of common stock to Hanover under the Purchase Agreement is subject to certain agreed upon threshold limitations set forth in the Purchase Agreement. Also, under the terms of the Purchase Agreement, we may not issue shares of our common stock to Hanover to the extent that Hanover or any of its affiliates would, at any time, beneficially own more than 9.99% of our outstanding common stock. (2) Applicable percentage ownership is based on 73,631,278 shares of our common stock outstanding as of March 31, 2014. (3) At an assumed purchase price of $0.057 (equal to 95.0% of the closing price of our common stock of $0.06 on March 31, 2014), and assuming the sale by us to Hanover of all of the 9,600,000 Shares, or approximately 13.04% of our issued and outstanding common stock, being registered hereunder pursuant to draw downs under the Purchase Agreement, we would receive only approximately $547,200 in gross proceeds. Furthermore, we may receive substantially less than $547,200 in gross proceeds from the financing due to our share price, discount to market and other factors relating to our common stock. If we elect to issue and sell more than the 9,600,000 Shares offered under this prospectus to Hanover, which we have the right, but not the obligation, to do, we must first register for resale under the Securities Act any such additional Shares, which could cause additional substantial dilution to our stockholders. Based on the above assumptions, we would be required to register an additional approximately 43,031,578 shares of our common stock to obtain the balance of $3,000,000 of the Total Commitment that would be available to us under the Purchase Agreement. Please see the section titled "Equity Enhancement Program With Hanover" elsewhere in this prospectus for a more detailed discussion of the number of shares we may be required to issue at various prices and the percentage of our outstanding shares that such shares would represent. (4)Assumes the sale of all shares being offered pursuant to this prospectus. (5)Applicable percentage ownership based on 90,904,355 shares of our common stock outstanding after the offering. (6)The business address of Hanover is c/o Magna Group, 5 Hanover Square, New York, New York 10004. Hanover s principal business is that of a private investment firm. We have been advised that Hanover is not a member of the Financial Industry Regulatory Authority, or FINRA, or an independent broker-dealer, and that neither Hanover nor any of its affiliates is an affiliate or an associated person of any FINRA member or independent broker-dealer. We have been further advised that Joshua Sason is the Chief Executive Officer and managing member of Hanover and owns all of the membership interests in Hanover, and that Mr. Sason has sole power to vote or to direct the vote and sole power to dispose or to direct the disposition of all securities owned directly by Hanover. (7)Guy Martin is the President, Chief Executive Officer, Treasurer, Chief Financial Officer and director of the Company. (8)Douglas Oliver is the Vice President of Exploration and a director of the Company (9)Joseph Galda is the Corporate Secretary and a director of the Company (10)David Bikerman is a director of the Company. EQUITY ENHANCEMENT PROGRAM WITH HANOVER Common Stock Purchase Agreement On February 18, 201, we entered into the Purchase Agreement with Hanover. The Purchase Agreement provides that, upon the terms and subject to the conditions set forth therein, Hanover is committed to purchase up to $3,000,000 worth of our common stock over the 24-month term of the Purchase Agreement. From time to time over the term of the Purchase Agreement, commencing on the trading day immediately following the date on which the registration statement of which this prospectus is a part is declared effective by the Commission, we may, in our sole discretion, provide Hanover with either Regular Draw Down Notices or, if certain conditions are satisfied, Fixed Draw Down Notices, in each case to purchase a specified amount of Shares, with each draw down subject to the limitations discussed below. The maximum amount of Shares requested to be purchased pursuant to any single Regular Draw Down Notice cannot exceed the Maximum Regular Draw Down Amount. The maximum amount of Shares requested to be purchased pursuant to any single Fixed Draw Down Notice cannot exceed the Maximum Fixed Draw Down Amount. Each purchase pursuant to a draw down will reduce, on a dollar-for-dollar basis, the Total Commitment under the Purchase Agreement. We may, in our sole discretion, provide Hanover with Regular Draw Down Notices to purchase a specified Draw Down Amount, up to the Maximum Regular Draw Down Amount, over a 10 consecutive trading day period commencing on the trading day specified in the applicable Regular Draw Down Notice. Once presented with a Regular Draw Down Notice, Hanover is required to purchase a pro rata portion of the applicable Draw Down Amount on each trading day during the applicable Pricing Period on which the daily VWAP equals or exceeds the Floor Price for such draw down. If the VWAP falls below the applicable Floor Price on any trading day during the applicable Pricing Period, the Purchase Agreement provides that Hanover will not purchase the pro rata portion of the applicable Draw Down Amount allocated to that trading day. The per share purchase price for the Shares subject to a Regular Draw Down Notice will be equal to 95.0% of the arithmetic average of the three lowest daily VWAPs that equal or exceed the applicable Floor Price during the applicable Pricing Period, except that if the VWAP does not equal or exceed the applicable Floor Price for at least three trading days during the applicable Pricing Period, then the per share purchase price will be equal to 95.0% of the arithmetic average of all VWAPs that equal or exceed the applicable Floor Price during such Pricing Period. We may, in our sole discretion, on any trading day on which both of the equity conditions described below are satisfied, provide Hanover with a Fixed Draw Down Notice to purchase a specified Draw Down Amount, up to the Maximum Fixed Draw Down Amount, on the applicable settlement date, which will occur within two trading days following the date the Fixed Draw Down Notice is delivered. The Fixed Purchase Price will be equal to 90.0% of the lower of (i) the lowest trade price of a share of our common stock on the Draw Down Exercise Date and (ii) the arithmetic average of the three lowest daily VWAPs during the 10 consecutive trading days ending on the trading day immediately preceding the applicable Draw Down Exercise Date. We may deliver a Fixed Draw Down Notice only if both of the following equity conditions have been satisfied as of the applicable Draw Down Exercise Date: on each trading day during the period beginning 30 trading days prior to the applicable Draw Down Exercise Date and ending on and including the applicable Draw Down Exercise Date, the lowest trade price of a share of our common stock must be greater than the Fixed Floor Price; and on each trading day during the period beginning 30 trading days prior to the applicable Draw Down Exercise Date and ending on and including the applicable Draw Down Exercise Date, the trade price of a share of our common stock must not have declined more than 7.0% from an intraday high to an intraday low during such trading day. By way of illustration, a Regular Draw Down Notice operates in the following manner: 1.The Company submits a Regular Draw Down Notice to Hanover detailing the amount of shares of common stock requested to be sold, the pricing period start date, the pricing period end date, the applicable floor price, and the settlement date; 2.The price at which the shares of common stock will ultimately be sold to Hanover is calculated over the following 10 trading days in accordance with the pricing formula set forth in the Purchase Agreement; 3.On the first trading day immediately following the end of the pricing period, the shares of common stock are issued and received by Hanover via DWAC against payment therefor; and 4.The next Regular Draw Down Notice or Fixed Draw Down Notice may be submitted to Hanover after a 24 hour waiting period. By way of illustration, a Fixed Draw Down Notice operates in the following manner: 1.The Company submits a Fixed Draw Down Notice to Hanover detailing the amount of shares of common stock requested to be sold, the applicable fixed purchase price for those shares, the total aggregate purchase price for those shares, and the settlement date; 2.No later than the first trading day following submission of the Fixed Draw Down Notice to Hanover, the shares of common stock are issued and received by Hanover via DWAC against payment therefor; and 3.The next Regular Draw Down Notice or Fixed Draw Down Notice may be submitted to Hanover after a 15 trading day waiting period. We are prohibited from issuing a Draw Down Notice if (i) the amount requested in such Draw Down Notice exceeds the Maximum Regular Draw Down Amount, in the case of a Regular Draw Down Notice, or exceeds the Maximum Fixed Draw Down Amount, in the case of a Fixed Draw Down Notice, (ii) the sale of Shares pursuant to such Draw Down Notice would cause us to issue or sell or Hanover to acquire or purchase an aggregate dollar value of Shares that would exceed the Total Commitment, or (iii) the sale of Shares pursuant to the Draw Down Notice would cause us to sell or Hanover to purchase an aggregate number of shares of our common stock which would result in beneficial ownership by Hanover of more than 9.99% of our common stock (as calculated pursuant to Section 13(d) of the Exchange Act and the rules and regulations thereunder). Furthermore, with respect to a draw down pursuant to a Regular Draw Down Notice, we cannot make more than one draw down (whether pursuant to a Fixed Draw Down Notice or a Regular Draw Down Notice) in any Pricing Period and must allow 24 hours to elapse between the completion of the settlement of any one draw down pursuant to a Regular Draw Down Notice and the delivery of any Fixed Draw Down Notice or Regular Draw Down Notice for any other draw down. With respect to a draw down pursuant to a Fixed Draw Down Notice, we must allow 11 trading days to elapse between the completion of the settlement of any one draw down pursuant to a Fixed Draw Down Notice and the delivery of any Fixed Draw Down Notice or Regular Draw Down Notice for any other draw down. As of March 31, 2014, there were 73,631,278 shares of our common stock outstanding, of which 64,066,101 shares were held by non-affiliates, excluding the 2,065,177 Initial Commitment Shares that we have already issued to Hanover under the Purchase Agreement. Although the Purchase Agreement provides that we may sell up to $3,000,000 of our common stock to Hanover, only 21,338,254 shares of our common stock are being offered under this prospectus, which represents (i) 3,923,077 shares of common stock that may be issued to Hanover upon conversion of the Convertible Note, (ii) 2,065,177 shares of common stock that we issued to Hanover as Initial Commitment Shares, (iii) a maximum of 3,750,000 shares of common stock that we may be required to issue to Hanover as Additional Commitment Shares (iv) 9,600,000 shares of common stock that we may issue to Hanover as Shares pursuant to draw downs under the Purchase Agreement, and (v) 2,000,000 shares of common stock held by our current directors and officers. If all of the 21,338,254 shares offered under this prospectus were issued and outstanding as of March 31, 2014, such shares would represent approximately 22.47% of the total number of shares of our common stock outstanding and 33.34% of the total number of outstanding shares of our common stock held by non-affiliates, in each case as of March 31, 2014. At an assumed purchase price of $0.057 (equal to 95.0% of the closing price of our common stock of $0.06 on March 31, 2014), and assuming the sale by us to Hanover of all of the 9,600,000 Shares, or approximately 13.04% of our issued and outstanding common stock, being registered hereunder pursuant to draw downs under the Purchase Agreement, we would receive only approximately $547,200 in gross proceeds. Furthermore, we may receive substantially less than $547,200 in gross proceeds from the financing due to our share price, discount to market and other factors relating to our common stock. If we elect to issue and sell more than the 9,600,000 Shares offered under this prospectus to Hanover, which we have the right, but not the obligation, to do, we must first register for resale under the Securities Act any such additional Shares, which could cause additional substantial dilution to our stockholders. Based on the above assumptions, we would be required to register an additional approximately 43,031,578 shares of our common stock to obtain the balance of $3,000,000 of the Total Commitment that would be available to us under the Purchase Agreement. We currently have authorized and available for issuance 300,000,000 shares of our common stock pursuant to our charter. The number of shares of our common stock ultimately offered for resale by Hanover is dependent upon a number of factors, including the extent to which Hanover converts the Convertible Note into shares of our common stock and the number of Shares we ultimately issue and sell to Hanover under the Purchase Agreement. The following table sets forth the total number of Shares that would be issued at varying purchase prices for us to receive the entire $3,000,000 million in gross proceeds under the Purchase Agreement (without accounting for certain fees and expenses): Assumed Average Purchase Price(1) Total Number of Shares to be Issued if Full Purchase Percentage of Currently Outstanding Shares (2) Proceeds from the Sale of Shares to Hanover Under the Purchase Agreement $0.015(3) 200,000,000 271.62% $3,000,000 $0.03(4) 100,000,000 135.81% $3,000,000 $0.045(5) 66,666,667 90.54% $3,000,000 $0.06(6) 50,000,000 67.90% $3,000,000 $0.075(7) 40,000,000 54.32% $3,000,000 $0.09(8) 33,333,333 45.27% $3,000,000 (1)Under the Purchase Agreement, with respect to a Regular Draw Down Notice, if the VWAP falls below the applicable Floor Price on any trading day during the applicable Pricing Period, the Purchase Agreement provides that Hanover will not purchase the pro rata portion of the applicable Draw Down Amount allocated to that trading day. We may not sell shares to Hanover pursuant to a Fixed Draw Down Notice for a Fixed Purchase Price less than the Fixed Floor Price due to certain equity conditions that must be satisfied in order for us to be eligible to deliver a Fixed Draw Down Notice. (2)The denominator is based on 73,631,278 shares outstanding as of March 31, 2014, adjusted to include 2,065,177 Initial Commitment Shares that were issued to Hanover as consideration for its commitment to purchase our common stock pursuant to the Purchase Agreement. The numerator is based on the number of Shares issuable to Hanover under the Purchase Agreement at the corresponding assumed average purchase price set forth in the adjacent column. (3)Assumed average purchase price is equal to 25% of the closing sale price of our common stock of $0.06 on March 31, 2014. (4)Assumed average purchase price is equal to 50% of the closing sale price of our common stock of $0.06 on March 31, 2014. (5)Assumed average purchase price is equal to 75% of the closing sale price of our common stock of $0.06 on March 31, 2014. (6)Represents the closing sale price of our common stock on March 31, 2014. (7)Assumed average purchase price is equal to 125% of the closing sale price of our common stock of $0.06 on March 31, 2014. (8)Assumed average purchase price is equal to 150% of the closing sale price of our common stock of $0.06 on March 31, 2014. The following table sets forth the amount of proceeds we would receive from Hanover from the sale of Shares under the Purchase Agreement that are registered in this offering (excluding the shares of common stock held by the directors and officers of the Company) at varying purchase prices (without accounting for certain fees and expenses): Assumed Average Purchase Price(1) Number of Registered Shares to be Issued Percentage of Currently Outstanding Shares (2) Proceeds from the Sale of Shares to Hanover Under the Purchase Agreement $0.015(3) 19,338,254 29.29% $290,073.81 $0.03(4) 19,338,254 29.29% $580,147.62 $0.045(5) 19,338,254 29.29% $870,221.43 $0.06(6) 19,338,254 29.29% $1,160,295.24 $0.075(7) 19,338,254 29.29% $1,450,269.05 $0.09(8) 19,338,254 29.29% $1,740,442.86 (1)Under the Purchase Agreement, with respect to a Regular Draw Down Notice, if the VWAP falls below the applicable Floor Price on any trading day during the applicable Pricing Period, the Purchase Agreement provides that Hanover will not purchase the pro rata portion of the applicable Draw Down Amount allocated to that trading day. We may not sell shares to Hanover pursuant to a Fixed Draw Down Notice for a Fixed Purchase Price less than the Fixed Floor Price due to certain equity conditions that must be satisfied in order for us to be eligible to deliver a Fixed Draw Down Notice. (2)The denominator is based on 73,631,278 shares outstanding as of March 31, 2014, adjusted to include 2,065,177 Initial Commitment Shares that were issued to Hanover as consideration for its commitment to purchase our common stock pursuant to the Purchase Agreement. The numerator is based on the number of Shares issuable to Hanover under the Purchase Agreement at the corresponding assumed average purchase price set forth in the adjacent column. (3)Assumed average purchase price is equal to 25% of the closing sale price of our common stock of $0.06 on March 31, 2014. (4)Assumed average purchase price is equal to 50% of the closing sale price of our common stock of $0.06 on March 31, 2014. (5)Assumed average purchase price is equal to 75% of the closing sale price of our common stock of $0.06 on March 31, 2014. (6)Represents the closing sale price of our common stock on March 31, 2014. (7)Assumed average purchase price is equal to 125% of the closing sale price of our common stock of $0.06 on March 31, 2014. (8)Assumed average purchase price is equal to 150% of the closing sale price of our common stock of $0.06 on March 31, 2014. Hanover has agreed that during the term of the Purchase Agreement, neither Hanover nor any of its affiliates will, directly or indirectly, engage in any short sales involving our securities or grant any option to purchase, or acquire any right to dispose of or otherwise dispose for value of, any shares of our common stock or any securities convertible into or exercisable or exchangeable for any shares of our common stock, or enter into any swap, hedge or other similar agreement that transfers, in whole or in part, the economic risk of ownership of any shares of our common stock. The Purchase Agreement contains customary representations, warranties and covenants by, among and for the benefit of the parties. Before Hanover is obligated to purchase any Shares pursuant to a Draw Down Notice, certain conditions specified in the Purchase Agreement, none of which are in Hanover's control, must be satisfied, including the following: Each of our representations and warranties in the Purchase Agreement must be true and correct in all material respects. We must have performed, satisfied and complied in all material respects with all covenants, agreements and conditions required to be performed, satisfied or complied with by us. The registration statement of which this prospectus forms a part must be effective under the Securities Act. We must not have knowledge of any event that could reasonably be expected to have the effect of causing the suspension of the effectiveness of the registration statement of which this prospectus forms a part or the prohibition or suspension of the use of this prospectus. We must have filed with the Commission all required prospectus supplements relating to this prospectus and all periodic reports and filings required to be filed by us under the Exchange Act. Trading in our common stock must not have been suspended by the Commission, the OTCQB or the Financial Industry Regulatory Authority, or FINRA, there must not have been imposed, and we must not have received any notice of, any suspension of electronic trading or settlement services by The Depository Trust Company, and trading in securities generally on the OTCQB must not have been suspende Trading in our common stock must not have been suspended by the Commission, the OTCQB or the Financial Industry Regulatory Authority, or FINRA, there must not have been imposed, and we must not have received any notice of, any suspension of electronic trading or settlement services by The Depository Trust Company, and trading in securities generally on the OTCQB must not have been suspended or limited.d or limited. We must have complied with all applicable federal, state and local governmental laws, rules, regulations and ordinances in connection with the execution, delivery and performance of the Purchase Agreement and the Registration Rights Agreement. No statute, regulation, order, decree, writ, ruling or injunction by any court or governmental authority of competent jurisdiction shall have been enacted, entered, promulgated, threatened or endorsed which prohibits the consummation of or which would materially modify or delay any of the transactions contemplated by the Purchase Agreement and the Registration Rights Agreement. No action, suit or proceeding before any arbitrator or any court or governmental authority shall have been commenced or threatened, and no inquiry or investigation by any governmental authority shall have been commenced or threatened seeking to restrain, prevent or change the transactions contemplated by the Purchase Agreement or the Registration Rights Agreement, or seeking material damages in connection with such transaction. The absence of any condition, occurrence, state of facts or event having, or insofar as reasonably can be foreseen would likely have, any effect on our business, operations, properties or financial condition that is material and adverse to us. There is no guarantee that we will be able to meet the foregoing conditions or any of the other conditions in the Purchase Agreement or that we will be able to draw down any portion of the Total Commitment available under the Purchase Agreement with Hanover. The obligations of Hanover under the Purchase Agreement to purchase shares of our common stock may not be transferred to any other party, and none of the terms or conditions contained in the Purchase Agreement may now be amended or waived by the parties. The registration statement of which this prospectus is a part will not cover sales by Hanover s transferees, notwithstanding Hanover s right to assign its rights under the Registration Rights Agreement to its affiliates. The Purchase Agreement may be terminated at any time by the mutual written consent of the parties. Unless earlier terminated, the Purchase Agreement will terminate automatically on the earliest to occur of (i) the first day of the month next following the 24-month anniversary of the effective date of the Registration Statement of which this prospectus is a part, (ii) the date on which Hanover purchases the Total Commitment worth of common stock under the Purchase Agreement and (iii) the date on which our common stock ceases to be listed or quoted on an eligible trading market under the Purchase Agreement. We may terminate the Purchase Agreement on one trading day s prior written notice to Hanover, subject to certain conditions, without fee, penalty or cost. Hanover may terminate the Purchase Agreement effective upon one trading day s prior written notice to us under certain circumstances, including the following: The existence of any condition, occurrence, state of facts or event having, or insofar as reasonably can be foreseen would likely have, any effect on our business, operations, properties or financial condition that is material and adverse to us. We enter into an agreement providing for certain types of financing transactions that are similar to the equity enhancement program with Hanover. Certain transactions involving a change in control of the company or the sale of all or substantially all of our assets have occurred. We are in breach or default in any material respect under any of the provisions of the Purchase Agreement or the Registration Rights Agreement, and, if such breach or default is capable of being cured, such breach or default is not cured within 10 trading days after notice of such breach or default is delivered to us. While Hanover holds any shares issued under the Purchase Agreement, the effectiveness of the registration statement that includes this prospectus is suspended or the use of this Prospectus is suspended or prohibited, and such suspension or prohibition continues for a period of 20 consecutive trading days or for more than an aggregate of 60 trading days in any 365-day period, subject to certain exceptions. Trading in our common stock is suspended and such suspension continues for a period of five consecutive trading days or for more than an aggregate of 20 trading days in any 365-day period. We have filed for and/or are subject to any bankruptcy, insolvency, reorganization or liquidation proceedings. The Purchase Agreement provides that no termination of the Purchase Agreement will limit, alter, modify, change or otherwise affect any of the parties' rights or obligations with respect to any pending Draw Down Notice, and that the parties must fully perform their respective obligations with respect to any such pending Draw Down Notice under the Purchase Agreement, provided all of the conditions to the settlement thereof are timely satisfied. We paid to Hanover a commitment fee for entering into the Purchase Agreement equal to $150,000 (or 5.0% of the Total Commitment under the Purchase Agreement) in the form of 2,065,177 Initial Commitment Shares, calculated using a per share price of $ 0.072633, representing the arithmetic average of the three lowest VWAPs during the 10-trading day period immediately preceding the Closing Date. In addition, promptly following the effective date of the registration statement of which this prospectus is a part, we are required to issue to Hanover a number of Additional Commitment Shares equal to the greater of (i) zero and (ii) the difference of (a) the quotient of (x) $150,000 divided by (y) the greater of (1) the lowest trade price of a share of our common stock during the period beginning two trading days immediately preceding the effective date of the registration statement of which this prospectus is a part and ending on such effective date and (2) $0.04, less (ii) 2,065,177, provided that in no event will we issue more than an aggregate of 3,750,000 shares of our common stock, subject to adjustment for any stock splits, stock combinations, stock dividends, recapitalizations and other similar transactions, as Additional Commitment Shares. The Commitment Shares are being registered for resale in the registration statement of which this prospectus is a part. We also agreed to pay an initial fee of $4,250 to Garden State Securities upon the execution of the transaction documents, and an amount equal to 2.5% of the proceeds of each draw down under the Purchase Agreement for its services in acting as placement agent in connection with the transaction. Further, if we issue a Draw Down Notice and fail to deliver the shares to Hanover on the applicable settlement date, we agreed to pay Hanover, in addition to all other remedies available to Hanover under the Purchase Agreement, an amount in cash equal to 2.0% of the purchase price of such shares for each 30-day period the shares are not delivered, plus accrued interest. The Purchase Agreement also provides for indemnification of Hanover and its affiliates in the event that Hanover incurs losses, liabilities, obligations, claims, contingencies, damages, costs and expenses related to a breach by us of any of our representations and warranties under the Purchase Agreement or the other related transaction documents or any action instituted against Hanover or its affiliates due to the transactions contemplated by the Purchase Agreement or other transaction documents, subject to certain limitations. The issuances of the Commitment Shares and the sale of the Shares to Hanover under the Purchase Agreement are exempt from registration under the Securities Act pursuant to the exemption for transactions by an issuer not involving any public offering under Section 4(a)(2) of and Regulation D under the Securities Act. Registration Rights Agreement In connection with the execution of the Purchase Agreement, on the Closing Date, we and Hanover also entered into the Registration Rights Agreement. Pursuant to the Registration Rights Agreement, we agreed to file the registration statement of which this prospectus is a part with the Commission on or prior to the Filing Deadline to register for resale 19,338,254 shares of our common stock, which includes the 2,065,177 Initial Commitment Shares and 3,750,000 Additional Commitment Shares, and have it declared effective prior to the Effectiveness Deadline. The effectiveness of the registration statement of which this prospectus is a part is a condition precedent to our ability to sell common stock to Hanover under the Purchase Agreement. We have agreed to file with the Commission one or more additional registration statements to cover all of the securities required to be registered under the Registration Rights Agreement that are not covered by this prospectus, in each case, as soon as practicable, but in no event later than the applicable filing deadline for such additional registration statements as provided in the Registration Rights Agreement. We also agreed, among other things, to indemnify Hanover from certain liabilities and fees and expenses of Hanover incident to our obligations under the Registration Rights Agreement, including certain liabilities under the Securities Act. Hanover has agreed to indemnify and hold harmless us and each of our directors, officers and persons who control us against certain liabilities that may be based upon written information furnished by Hanover to us for inclusion in the registration statement of which this prospectus is a part, including certain liabilities under the Securities Act. As discussed above, the obligations of Hanover under the Purchase Agreement to purchase shares of our common stock may not be transferred to any other party. Hanover may not assign its rights under the Registration Rights Agreement other than to an affiliate of Hanover. The registration statement of which this prospectus is a part will not cover sales by Hanover s transferees, notwithstanding Hanover s right to assign its rights under the Registration Rights Agreement to its affiliates. None of the terms or conditions contained in the Registration Rights Agreement may now be amended or waived by the parties. The foregoing description of the Purchase Agreement and the Registration Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Purchase Agreement and Registration Rights Agreement, copies of which have been filed or incorporated by reference as exhibits to the registration statement of which this prospectus is a part. PLAN OF DISTRIBUTION We are registering shares of common stock that have been or may be issued by us from time to time to Hanover under the Purchase Agreement and upon conversion of the Convertible Note, and shares of common stock held by the directors of the Company, to permit the resale of these shares of common stock after the issuance thereof by the selling stockholders from time to time after the date of this prospectus. We will not receive any of the proceeds from the sale by the selling stockholders of the shares of common stock. We will bear all fees and expenses incident to our obligation to register the shares of common stock. The selling stockholders may decide not to sell any shares of common stock. The selling stockholders may sell all or a portion of the shares of common stock beneficially owned by them and offered hereby from time to time directly or through one or more underwriters, broker-dealers or agents, who may receive compensation in the form of discounts, concessions or commissions from the selling stockholders and/or the purchasers of the shares of common stock for whom they may act as agent. In effecting sales, broker-dealers that are engaged by the selling stockholders may arrange for other broker-dealers to participate. With respect to the shares of common stock that have been and may be issued pursuant to the Purchase Agreement, Hanover is an "underwriter" within the meaning of Section 2(a)(11) of the Securities Act, and with respect to any other shares of common stock, Hanover may be deemed to be an "underwriter" within the meaning of Section 2(a)(11) of the Securities Act. Any brokers, dealers or agents who participate in the distribution of the shares of common stock by the selling stockholders may also be deemed to be "underwriters," and any profits on the sale of the shares of common stock by them and any discounts, commissions or concessions received by any such brokers, dealers or agents may be deemed to be underwriting discounts and commissions under the Securities Act. Hanover has advised us that it will use an unaffiliated broker-dealer to effectuate all resales of our common stock. To our knowledge, Hanover has not entered into any agreement, arrangement or understanding with any particular broker-dealer or market maker with respect to the shares of common stock offered hereby, nor do we know the identity of the broker-dealers or market makers that may participate in the resale of the shares. Because Hanover is (with respect to shares of common stock issued under the Purchase Agreement) and may be deemed to be (with respect to any other shares of common stock), and any other selling stockholders, broker, dealer or agent may be deemed to be, an "underwriter" within the meaning of Section 2(a)(11) of the Securities Act, Hanover will (and any other selling stockholders, broker, dealer or agent may) be subject to the prospectus delivery requirements of the Securities Act and may be subject to certain statutory liabilities of the Securities Act (including, without limitation, Sections 11, 12 and 17 thereof) and Rule 10b-5 under the Exchange Act. The selling stockholders will act independently of us in making decisions with respect to the timing, manner and size of each sale. The shares of common stock may be sold in one or more transactions at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale, or at negotiated prices. These sales may be effected in transactions, which may involve crosses or block transactions, pursuant to one or more of the following methods: on any national securities exchange or quotation service on which the securities may be listed or quoted at the time of sale; in the over-the-counter market in accordance with the rules of NASDAQ; in transactions otherwise than on these exchanges or systems or in the over-the-counter market; through the writing or settlement of options, whether such options are listed on an options exchange or otherwise; ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction; purchases by a broker-dealer as principal and resale by the broker-dealer for its account; an exchange distribution in accordance with the rules of the applicable exchange; privately negotiated transactions; broker-dealers may agree with the selling stockholder to sell a specified number of such shares at a stipulated price per share; a combination of any such methods of sale; and any other method permitted pursuant to applicable law. In addition, the selling stockholders may transfer the shares of common stock by other means not described in this prospectus. Any broker-dealer participating in such transactions as agent may receive commissions from the selling stockholders (and, if they act as agent for the purchaser of such shares, from such purchaser). Hanover has informed us that each such broker-dealer will receive commissions from Hanover which will not exceed customary brokerage commissions. Broker-dealers may agree with the selling stockholders to sell a specified number of shares at a stipulated price per share, and, to the extent such a broker-dealer is unable to do so acting as agent for the selling stockholders, to purchase as principal any unsold shares at the price required to fulfill the broker-dealer commitment to the selling stockholders. Broker-dealers who acquire shares as principal may thereafter resell such shares from time to time in one or more transactions (which may involve crosses and block transactions and which may involve sales to and through other broker-dealers, including transactions of the nature described above and pursuant to the one or more of the methods described above) at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale, or at negotiated prices, and in connection with such resales may pay to or receive from the purchasers of such shares commissions computed as described above. To the extent required under the Securities Act, an amendment to this prospectus or a supplemental prospectus will be filed, disclosing: the name of any such broker-dealers; the number of shares involved; the price at which such shares are to be sold; the commission paid or discounts or concessions allowed to such broker-dealers, where applicable; that such broker-dealers did not conduct any investigation to verify the information set out or incorporated by reference in this prospectus, as supplemented; and other facts material to the transaction. The selling stockholders have informed us that they do not have any written or oral agreement or understanding, directly or indirectly, with any person to distribute the common stock. Under the securities laws of some states, the shares of common stock may be sold in such states only through registered or licensed brokers or dealers. In addition, in some states the shares of common stock may not be sold unless such shares have been registered or qualified for sale in such state or an exemption from registration or qualification is available and is complied with. There can be no assurance that the selling stockholders will sell any or all of the shares of common stock registered pursuant to the registration statement, of which this prospectus forms a part. Underwriters and purchasers that are deemed underwriters under the Securities Act may engage in transactions that stabilize, maintain or otherwise affect the price of the common stock, including the entry of stabilizing bids or syndicate covering transactions or the imposition of penalty bids. The selling stockholders and any other person participating in the sale or distribution of the shares of common stock will be subject to applicable provisions of the Exchange Act and the rules and regulations thereunder (including, without limitation, Regulation M of the Exchange Act), which may restrict certain activities of, and limit the timing of purchases and sales of any of the shares of common stock by, the selling stockholders and any other participating person. To the extent applicable, Regulation M may also restrict the ability of any person engaged in the distribution of the shares of common stock to engage in market-making and certain other activities with respect to the shares of common stock. In addition, the anti-manipulation rules under the Exchange Act may apply to sales of the shares of common stock in the market. All of the foregoing may affect the marketability of the shares of common stock and the ability of any person or entity to engage in market-making activities with respect to the shares of common stock. We have agreed to pay all expenses of the registration of the shares of common stock pursuant to the registration rights agreement, estimated to be $41,192.23 in total, including, without limitation, Securities and Exchange Commission filing fees and expenses of compliance with state securities or "Blue Sky" laws; provided, however, each selling stockholder will pay all selling commissions, concessions and discounts, and other amounts payable to underwriters, dealers or agents, if any, as well as transfer taxes and certain other expenses associated with the sale of the shares of common stock incurred by them. We have agreed to indemnify Hanover and certain other persons against certain liabilities in connection with the offering of shares of common stock offered hereby, including liabilities arising under the Securities Act or, if such indemnity is unavailable, to contribute amounts required to be paid in respect of such liabilities. Hanover has agreed to indemnify us against liabilities under the Securities Act that may arise from any written information furnished to us by Hanover specifically for use in this prospectus or, if such indemnity is unavailable, to contribute amounts required to be paid in respect of such liabilities. At any time a particular offer of the shares of common stock is made by the selling stockholders, a revised prospectus or prospectus supplement, if required, will be distributed. Such prospectus supplement or post-effective amendment will be filed with the Commission to reflect the disclosure of any required additional information with respect to the distribution of the shares of common stock. We may suspend the sale of shares by the selling stockholders pursuant to this prospectus for certain periods of time for certain reasons, including if the prospectus is required to be supplemented or amended to include additional material information. DESCRIPTION OF BUSINESS Unless the context indicates or suggests otherwise, references to "we," "our," "us," the "Company," "Tungsten" or the "Registrant" refer to Tungsten Corp., a Nevada corporation and its wholly owned subsidiaries. Overview We were incorporated in the state of Nevada on June 5, 2008 under the name "Online Tele-Solutions, Inc." We intended to develop and offer Internet-based hosted call center services for small to medium sized companies; however we were not successful in our product development and execution of the initial stage of our marketing efforts. As such, we changed our business model and became an exploration stage mining company engaged in the identification, acquisition, and exploration of metals and minerals with a focus on tungsten mineralization on our properties located in Nevada. We intend to conduct exploration and development programs on our recently optioned properties as discussed below. On March 14, 2012, we approved an amendment to the Company s Articles of Incorporation (i) increasing the number of authorized shares of common stock from 50,000,000 to 300,000,000, (ii) creating 25,000,000 shares of "blank check" preferred stock, and (iii) effecting a thirty-for-one (30:1) forward split of the Company s issued and outstanding shares of common stock. The forward split became effective with the Financial Industry Regulatory Authority as of the opening of business on May 9, 2012. On April 8, 2013, we entered into and closed a voluntary share exchange transaction pursuant to a stock exchange agreement with Guy Martin and Nevada Tungsten Holdings Ltd. (the "SEA"). Pursuant to the terms of the SEA, we acquired all of the issued and outstanding shares of Nevada Tungsten Holdings Ltd. s common stock from Guy Martin in exchange for the issuance by our company of 3,000,000 shares of our common stock to Guy Martin (the "Transaction"). The sole asset of Nevada Tungsten Holdings Ltd. is an option to acquire all tungsten rights in regards to 32 patented and unpatented mining claims situated in White Pine Country, Nevada pursuant to an option agreement by and between Viscount Nevada Holdings Ltd. and Nevada Tungsten Holdings Ltd. (the "Option Agreement"). As a result of the transaction described above, Nevada Tungsten Holdings Ltd. became our wholly-owned subsidiary. On November 6, 2012, we changed our name to Tungsten Corp. Nevada Tungsten Holdings Ltd. was incorporated in the state of Nevada on October 30, 2012, with the goal of investigating for promising tungsten opportunities in the United States. Nevada Tungsten Holdings Ltd. s operations since incorporation focused on the investigation and identification of promising tungsten opportunities. The sole asset of Nevada Tungsten Holdings Ltd. is an option to acquire all tungsten rights in regards to 32 patented and unpatented mining claims situated in White Pine County, Nevada (the "Cherry Creek Tungsten Project"). In order to complete the transactions contemplated by the Option Agreement by and between Viscount Nevada Holdings Ltd. (the "Optionor") and Nevada Tungsten Holdings Ltd. Nevada Tungsten Holdings Ltd. was initially required to pay $150,000 to the Optionor by February 15, 2013, which amount has now been paid. Pursuant to the SEA, we agreed to undertake Nevada Tungsten Holdings Ltd. s obligations under the Option Agreement. The Option Agreement gives the Company the option to acquire a 100% interest in all tungsten on the Cherry Creek Tungsten Project by (i) paying $100,000 to the Optionor on or before February 15, 2014 and $50,000 to the Optionor on or before February 15, 2015; and (ii) incur exploration expenditures on the property of $250,000 on or before the first anniversary of the option agreement, additional exploration expenditures on the property of $250,000 on or before the second anniversary of the option agreement, and additional exploration expenditures on the property of $1,000,000 on or before the third anniversary of the option agreement. The Optionor has retained a 3% net smelter return royalty. On February 7, 2014, the parties to the Option Agreement agreed to defer the payment due on February 15, 2014 and exploration expenditures requirement due on the first anniversary of the Option Agreement until June 15, 2014. As consideration for this deferment, the Company issued 250,000 shares of Company common stock to the Optionor. We expect to fund the payment and exploration expenditure requirements detailed in the Option Agreement with proceeds from the sale of securities included in this registration statement. If we are unable to meet the terms of the Option Agreement, including the payments and expenditures required thereunder, we will likely lose our rights to the mining claims associated with the Cherry Creek Tungsten Project. On April 19, 2013, Nevada Tungsten Holdings Ltd. entered into a purchase agreement (the "Monfort Agreement") with Monfort Ventures Ltd. ("Monfort"), pursuant to which we acquired title to certain unpatented pacer mining claims located in Custer County, Idaho (the "Idaho Property") in consideration for the issuance of 3,000,000 shares of our common stock to Monfort Upon the commencement of operations of a producing mine on the Idaho Property and the production of mineral products therefrom, the Idaho Property will be subject to a net smelter returns royalty of 3%. For purposes of the Monfort Agreement, "net smelter returns" means the net proceeds paid to us from the sale of minerals mined and removed from the Idaho Property after deducting certain expenses as specified in the Monfort Agreement. At any time after execution of the Monfort Agreement, we may acquire one percent (1%) of the net smelter royalty from Monfort for Five Hundred Thousand Dollars ($500,000) and thereafter, may acquire another additional one percent (1%) of the net smelter royalty from Monfort for One Million Dollars ($1,000,000). Subsequent to the purchase of the Idaho claim, management decided to impair the value of the acquired unpatented pacer mining claims by $750,000. This impairment was a consequence of the assets being exploratory in nature and not being supported by any ore reserves. It is not possible to evaluate and establish the real value of the mineral properties until additional work is completed and that may take several years. With that being stated, the Company s position is that these acquired mineral assets, which consist of ownership of unpatented mining claims, cannot be truly assessed at this time. The Company assumes that these assets have been impaired and the exchange price based on $0.25 per share is not supportable as the possible value of these assets in the future. The Company impaired the stock value exchange of $750,000 as of year end. Since we are an exploration stage company, there is no assurance that a commercially viable mineral reserve exists on any of our current or future properties. To date, we do not know if an economically viable mineral reserve exists on our property and there is no assurance that we will discover one. Even if we do eventually discover a mineral reserve on our property, there can be no assurance that we will be able to develop our property into a producing mine and extract those resources. Both mineral exploration and development involve a high degree of risk and few properties which are explored are ultimately developed into producing mines. Our current operational focus is to conduct exploration activities on the Cherry Creek Tungsten Project and the Idaho Property, and to complete the terms of the Option Agreement. For a description of our Cherry Creek Tungsten Project, please see the section entitled "Properties" beginning on page 41. Plan of Operations Our initial exploration program on the Cherry Creek Property included spectral analysis, stream sediment, soil and rock sampling, ultra violate prospecting, and the collection of historical reports and data. Results from the initial exploration program have identified three distinct areas within the property boundaries that display strongly anomalous and/or elevated concentrations of tungsten. Our ongoing exploration plans for the Cherry Creek Property consist of the following: 1. Create a 3D computer database of the Ticup Mine. A review of the historic geologic literature suggests that additional tungsten ore deposits are likely below the existing deposits in close proximity to the Exchequer Fault. 2. Detailed grid soil sampling on the west side of Pinenut Canyon where previous exploration has revealed strongly anomalous tungsten. The area of interest is open to the south, west and east. 3. Grid soil sampling on low-lying hills to the southwest of Cherry Creek where previous exploration has revealed strongly anomalous tungsten in stream sediment samples. 4. Rock-chip sampling of prospective lithologies performed in conjunction with soil sampling. 5. Discovery core drilling in all three areas as targets are developed. 6. Intensive and targeted core drilling program to validate the in-situ reserves The costs to conduct Steps 1 through 4 are projected at $16,640. This will be supervised by Vice President of Exploration Douglas Oliver. Consulting Geologist Richard Dorman would construct the 3D database and participate in the evaluation of the Pinenut and Southeast Target Areas. Carlin Trend Mining Services would collect samples for the soil surveys. These steps, taken together, will take approximately two months to complete and we anticipate these steps to be completed by August 2014. A preliminary estimate for Step 5 is $227,915 for an initial six hole core-drilling program. This program will be supervised by Vice President of Exploration Douglas Oliver. This step will take approximately three months to complete and we anticipate completing Step 5 by November 2014. Once the above work has been undertaken, a more comprehensive picture of the potential for re-establishing a producing tungsten facility can be established. At that point, with the results of Steps 1 – 5 in hand, we will be in a position to develop and execute Step 6, for which we estimate the cost at approximately $1,250,000. This step will take approximately 12 months to complete and we anticipate completing this final step by November 2015. We intend to use the funds available from the Note Purchase Agreement and the Purchase Agreement with Hanover to finance our ongoing exploration plans for the Cherry Creek Property. Sources of Available Land for Mining and Exploration There are at least five sources of land available for exploration, development and mining: public lands, private fee lands, unpatented mining claims, patented mining claims, and tribal lands. The primary sources for acquisition of these lands are the United States government, through the Bureau of Land Management and the United States Forest Service, state governments, tribal governments, and individuals or entities that currently hold title to or lease government and private lands. There are numerous levels of government regulation associated with the activities of exploration and mining companies. Permits include "Notice of Intent" to explore, "Plan of Operations" to explore, "Plan of Operations" to mine, "Reclamation Permit," "Air Quality Permit," "Water Quality Permit," "Industrial Artificial Pond Permit," and several other health and safety permits. These permits are and will be subject to amendment or renewal during our operations. Although there is no guarantee that the regulatory agencies will timely approve, if at all, the necessary permits for our current operations or other anticipated operations, we have no reason to believe that necessary permits will not be issued in due course. The total cost and effects on our operations of the permitting and bonding process cannot be estimated at this time. The cost will vary for each project when initiated and could be material. The Federal government owns public lands that are administered by the Bureau of Land Management or the United States Forest Service. Ownership of the subsurface mineral estate can be acquired by staking a twenty (20) acre mining claim granted under the General Mining Law of 1872, as amended (the "General Mining Law"). The Federal government still owns the surface estate even though the subsurface can be controlled with a right to extract through claim staking. Private fee lands are lands that are controlled by fee-simple title by private individuals or corporations. These lands can be controlled for mining and exploration activities by either leasing or purchasing the surface and subsurface rights from the private owner. Unpatented mining claims located on public land owned by another entity can be controlled by leasing or purchasing the claims outright from the owners. Patented mining claims are claims that were staked under the General Mining Law, and through application and approval the owners were granted full private ownership of the surface and subsurface estate by the Federal government. These lands can be acquired for exploration and mining through lease or purchase from the owners. Tribal lands are those lands that are under control by sovereign Native American tribes. Areas that show promise for exploration and mining can be leased or joint ventured with the tribe controlling the land. Competition We are a mineral resources exploration company. We compete with many companies in the mining business, including larger, more established mining companies with substantial capabilities, personnel and financial resources. Further, there is a limited supply of desirable mineral lands available for claim-staking, lease or acquisition in the United States and other areas where we may conduct exploration activities. Because we compete with individuals and companies that have greater financial resources and larger technical staffs, we may be at a competitive disadvantage in acquiring desirable mineral properties. From time to time, specific properties or areas that would otherwise be attractive to us for exploration or acquisition are unavailable due to their previous acquisition by other companies or our lack of financial resources. Competition in the mining industry is not limited to the acquisition of mineral properties but also extends to the technical expertise to find, advance, and operate such properties; the labor to operate the properties; and the capital needed to fund the acquisition and operation of such properties. Competition may result in our company being unable not only to acquire desired properties, but to recruit or retain qualified employees, to obtain equipment and personnel to assist in our exploration activities or to acquire the capital necessary to fund our operation and advance our properties. Our inability to compete with other companies for these resources would have a material adverse effect on our results of operation and business. As noted above, we compete with other mining and exploration companies, many of which possess greater financial resources and technical facilities than we do, in connection with the acquisition of suitable exploration properties and in connection with the engagement of qualified personnel. The mineral resource exploration and mining industry is fragmented, and we are a very small participant in this sector. Many of our competitors explore for a variety of minerals and control many different properties around the world. Many of them have been in business longer than we have and have established more strategic partnerships and relationships and have greater financial accessibility than we have. Accordingly, given the significant competition for mineral resource exploration properties, including tungsten, we may be unable to continue to acquire interests in attractive tungsten and other mineral exploration properties on terms we consider acceptable. While we compete with other exploration companies in acquiring suitable properties, we believe that there would be readily available purchasers of tungsten and other precious metals if they were to be produced from any of the properties we acquire an interest in. The price of precious metals can be affected by a number of factors beyond our control, including: fluctuations in the market prices for tungsten; fluctuating supplies of tungsten; fluctuating demand for tungsten; and mining activities of others. If we find tungsten mineralization that is determined to be of economic grade and in sufficient quantity to justify production, we may then seek significant additional capital through equity or debt financing to develop, mine and sell our production. Our production would probably be sold to a refiner that would in turn purify our material and then sell it on the open market or through its agents or dealers. We do not engage in hedging transactions and we have no hedged mineral resources. Compliance with Government Regulations Various levels of governmental controls and regulations address, among other things, the environmental impact of mineral exploration and mineral processing operations and establish requirements for decommissioning of mineral exploration properties after operations have ceased. With respect to the regulation of mineral exploration and processing, legislation and regulations in various jurisdictions establish performance standards, air and water quality emission standards and other design or operational requirements for various aspects of the operations, including health and safety standards. Legislation and regulations also establish requirements for decommissioning, reclamation and rehabilitation of mineral exploration properties following the cessation of operations and may require that some former mineral properties be managed for long periods of time. Our exploration activities are subject to various levels of federal and state laws and regulations relating to protection of the environment, including requirements for closure and reclamation of mineral exploration properties. Some of the laws and regulations include the Clean Air Act, the Clean Water Act, the Comprehensive Environmental Response, Compensation and Liability Act, the Emergency Planning and Community Right-to-Know Act, the Endangered Species Act, the Federal Land Policy and Management Act, the National Environmental Policy Act, the Resource Conservation and Recovery Act, and all the related state laws in Nevada. The state of Nevada adopted the Mined Land Reclamation Act (the "Nevada Act") in 1989 that established design, operation, monitoring and closure requirements for all mining operations in the state. The Nevada Act has increased the cost of designing, operating, monitoring and closing new mining facilities and could affect the cost of operating, monitoring and closing existing mining facilities. New facilities are also required to provide a reclamation plan and financial assurance to ensure that the reclamation plan is implemented upon completion of operations. The Nevada Act also requires reclamation plans and permits for exploration projects that will result in more than five acres of surface disturbance. We plan to secure all necessary state and federal permits for our exploration activities and we intend to file for the required permits to conduct our exploration programs as necessary. These permits are usually obtained from either the Bureau of Land Management or the United States Forest Service. Obtaining such permits usually requires the posting of small bonds for subsequent remediation of trenching, drilling and bulk-sampling. We have not started the drilling program and therefore no permits are currently required for our initial exploration activities. The necessary permits to allow us to complete our exploration program will be secured when we have properly funded the projected cost of the drilling program. We do not anticipate discharging water into active streams, creeks, rivers, lakes or any other bodies of water without an appropriate permit. We also do not anticipate disturbing any endangered species or archaeological sites or causing damage to the properties in which we have an interest. Re-contouring and re-vegetation of disturbed surface areas will be completed pursuant to the applicable permits. The cost of remediation work varies according to the degree of physical disturbance. It is difficult to estimate the cost of compliance with environmental laws since the full nature and extent of our proposed activities cannot be determined at present. Research and Development Expenditures We have incurred $Nil in research and development expenditures over the past two fiscal years. Employees Currently, we have two employees. We have entered into employment agreements with our president, chief executive officer, treasurer and chief financial officer, and also with our V.P. of Exploration. Our directors, executive officers and certain contracted individuals play an important role in the running of the Company. We do not expect any material changes in the number of employees over the next 12 month period. We do and will continue to outsource contract employment as needed. We will engage contractors from time to time to consult with us on specific corporate affairs or to perform specific tasks in connection with our exploration programs. Subsidiaries Our sole subsidiary is now Nevada Tungsten Holdings Ltd. Intellectual Property We do not own, either legally or beneficially, any patent or trademark. DESCRIPTION OF SECURITIES TO BE REGISTERED General The following summary includes a description of material provisions of our capital stock. Authorized and Outstanding Securities The Company is authorized to issue 300,000,000 shares of common stock, par value $0.0001 per share and 25,000,000 shares of "blank check" preferred stock, par value, $0.0001. As of March 31, 2014, there were issued and outstanding 73,631,278 shares of our common stock and 0 shares of our preferred stock issued or outstanding. Common Stock The holders of our common stock are entitled to one vote for each share on all matters to be voted on by the shareholders. Holders of common stock do not have cumulative voting rights. Holders of common stock are entitled to share ratably in dividends, if any, as may be declared from time to time by the board of directors in its discretion from funds legally available therefore. In the event of a liquidation, dissolution or winding up of the Company, the holders of common stock are entitled to share pro rata all assets remaining after payment in full of all liabilities. Holders of common stock have no preemptive rights to purchase the Company s common stock. There are no conversion or redemption rights or sinking fund provisions with respect to the common stock. Preferred Stock In accordance with our Articles of Incorporation, the Board of Directors may fix and determine the designations, rights, preferences or other variations of each class or series within each class of preferred stock. To date, the Company has not issued any shares of preferred stock or designated any class of preferred stock. No shares of preferred stock are outstanding. Dividends Dividends, if any, will be contingent upon our revenues and earnings, if any, capital requirements and financial conditions. The payment of dividends, if any, will be within the discretion of our board of directors. We intend to retain earnings, if any, for use in its business operations and accordingly, the board of directors does not anticipate declaring any dividends in the foreseeable future. Convertible Note We issued the Convertible Note to Hanover on January 2, 2014 in the initial principal amount of $127,500 for a purchase price of $85,000, representing an approximately 33.33% original issue discount. We are registering the shares of common stock underlying the Convertible Note. For a complete description of the Convertible Note, reference is made to the section entitled "Prospectus Summary" above, which is incorporated herein by reference. Registration Rights Note Registration Rights Agreement In connection with the execution of the Note Purchase Agreement, on January 2, 2014, Hanover and we entered into the Note Registration Rights Agreement. Pursuant to the Note Registration Rights Agreement, we agreed to file the registration statement of which this prospectus is a part with the Commission to register for resale 3,923,077 shares of our common stock into which the Convertible Note may be converted and have it declared effective at the earlier of (i) the 100th calendar day after January 2, 2014 and (ii) the fifth business day after the date we are notified by the Commission that the registration statement will not be reviewed or will not be subject to further review. We have agreed to file with the Commission one or more additional registration statements to cover all of the securities required to be registered under the Note Registration Rights Agreement that are not covered by this prospectus, in each case, as soon as practicable, but in no event later than the applicable filing deadline for such additional registration statements as provided in the Note Registration Rights Agreement. We also agreed, among other things, to indemnify Hanover from certain liabilities and fees and expenses of Hanover incident to our obligations under the Note Registration Rights Agreement, including certain liabilities under the Securities Act. Hanover has agreed to indemnify and hold harmless us and each of our directors, officers and persons who control us against certain liabilities that may be based upon written information furnished by Hanover to us for inclusion in the registration statement of which this prospectus is a part, including certain liabilities under the Securities Act. Registration Rights Agreement In connection with the execution of the Purchase Agreement, on the Closing Date, we and Hanover entered into the Registration Rights Agreement. Pursuant to the Registration Rights Agreement, we agreed to file the registration statement of which this prospectus is a part with the Commission to register for resale 19,338,254 shares of our common stock, which includes the 2,065,177 Initial Commitment Shares and 3,750,000 Additional Commitment Shares, on or prior to March 28, 2014, which we refer to as the Filing Deadline, and have it declared effective at the earlier of (A) the 90th calendar day after the earlier of (1) the Filing Deadline and (2) the date on which the registration statement of which this prospectus is a part is filed with the Commission and (B) the fifth business day after the date the Company is notified by the Commission that the registration statement will not be reviewed or will not be subject to further review, which we refer to as the Effectiveness Deadline. The effectiveness of the registration statement of which this prospectus is a part is a condition precedent to our ability to sell common stock to Hanover under the Purchase Agreement. We have agreed to file with the Commission one or more additional registration statements to cover all of the securities required to be registered under the Registration Rights Agreement that are not covered by this prospectus, in each case, as soon as practicable, but in no event later than the applicable filing deadline for such additional registration statements as provided in the Registration Rights Agreement. We also agreed, among other things, to indemnify Hanover from certain liabilities and fees and expenses of Hanover incident to our obligations under the Registration Rights Agreement, including certain liabilities under the Securities Act. Hanover has agreed to indemnify and hold harmless us and each of our directors, officers and persons who control us against certain liabilities that may be based upon written information furnished by Hanover to us for inclusion in the registration statement of which this prospectus is a part, including certain liabilities under the Securities Act. Filings We are obligated to file a registration statement with respect to the shares of common stock issued or issuable in connection with the Purchase Agreement and the Convertible Note. Upon becoming effective, we shall use commercially reasonable efforts to maintain the continuous effectiveness of such registration statement during the period the Rights Agreement is in effect. We will also take such action, if any, as is necessary to obtain an exemption for or to qualify such shares of common stock under applicable state securities or "Blue Sky" laws; provided, however, that the Company shall not be required in connection therewith or as a condition thereto to qualify to do business in any jurisdiction where it would not otherwise be required to qualify or to consent to service of process in any such jurisdiction. Expenses of Registration Rights We will pay all reasonable expenses incurred in connection with the registrations described above. However, we will not be responsible for selling commissions, concessions and discounts, and other amounts payable to underwriters, dealers or agents, if any, as well as transfer taxes and certain other expenses associated with the sale of the shares of common stock. INTERESTS OF NAMED EXPERTS AND COUNSEL No expert or counsel named in this prospectus as having prepared or certified any part of this prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis, or had, or is to receive, in connection with the offering, a substantial interest, direct or indirect, in the registrant or any of its parents or subsidiaries. Nor was any such person connected with the registrant or any of its parents or subsidiaries as a promoter, managing or principal underwriter, voting trustee, director, officer, or employee. The financial statements included in this prospectus and in the registration statement have been audited by Li and Company, PC and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting. The validity of the issuance of the common stock hereby will be passed upon for us by Greenberg Traurig, LLP. PROPERTIES Our executive, administrative, and operating offices are located at 1671 Southwest 105 Lane, Davie, Florida, 33324. We believe these facilities are adequate for our current needs and that alternate facilities on similar terms would be readily available if needed. This property is provided free of charge by our President, although we do not have any specific agreement in this regard. We hold an option to acquire all rights to tungsten in the Cherry Creek Tungsten Project pursuant to the Option Agreement entered into by our subsidiary, Nevada Tungsten Holdings Ltd. We also acquired title to certain unpatented pacer mining claims located in Custer County, Idaho (the "Wildhorse Tungsten Project"). For a description of the terms of this Option Agreement and the acquisition of the Wildhorse Tungsten Project, please see the section entitled "Business" above. Glossary of Technical Terms AlaskiteIntrusive rock containing fine quartz and feldspar crystals AnticlineFolds where the rocks have been bowed upwards ArgilliteMetamorphosed shale CarbonateRocks or minerals composed of calcite or dolomite CoreDiamond drilling method producing a cylinder of rock EpidoteCalcium-bearing mineral found in tactite LithologiesTypes of rock grouped on composition MarbleMetamorphosed limestone PatentedMining claims conveying both mineral and surface rightsReverse CirculationPercussion drilling method producing chips of rock ScheelitePrincipal ore mineral of tungsten, common in tactite TactiteCarbonate rock that has been altered and mineralized Spectral AnalysisUse of select wavelengths in aerial images for exploration QuartziteMetamorphosed siliceous sandstone UltravioletShort wavelength light used to detect scheelite UnpatentedMining claims conveying only mineral rights WolframiteMinor ore mineral of tungsten Commonly used abbreviations and acronyms ggrams mmeters mmmillimeters kmkilometers ppmparts per million RCreverse circulation drilling method STUshort ton unit (20 lbs of contained WO3) tpdtons per day ton2,000 pounds Wtungsten WO3tungsten oxide Cherry Creek Tungsten Project Location The Cherry Creek Tungsten Project consists of 2 patented and 139 unpatented mining claims situated in White Pine County, Nevada. The Project is approximately 52 miles by paved highway northeast of Ely, Nevada. The Cherry Creek Mining District has been known mainly for its long history of silver production, dating back to the late nineteenth century. In the year 1915, tungsten production commenced at the Shoestring Mine. From that time on, tungsten production was conducted on an intermittent basis mainly during the times of the two world wars and the Korean conflict. The last known production was in 1977 from the Shoestring Mine. Disturbance and Contamination Issues The Creek Mining District has a long history of mineral production extending over 100 years. The area is dotted with mines, prospect pits, mine dumps, abandoned buildings and the footings for mines and processing plants. Testing of water contained within the Star and Exchequer Mines suggests that there has been negligible contamination to groundwater from these historic workings. There are no plans to remediate the historic mine sites. Acreage We control two patented and 139 unpatented mining claims in the Cherry Creek District comprising approximately 2,780 acres. Taxes and assessment work are paid on these claims through August 31, 2014. Mineral Resources and Reserves There are no identified resources or reserves of tungsten within the Cherry Creek Mining District. Water and Power Because of its past production, infrastructure within the Cherry Creek Mining District is relatively advanced. Water can be drawn in limited amounts from several of the flooded mines. More significant volumes of water would likely require the drilling of a well in the adjacent valley. The town of Cherry Creek contains an electrical substation that would be adequate for powering any foreseeable mine. Examination of the property descriptions where tungsten was mined reveals a common mineralogy and mode of occurrence for all the historic tungsten bearing zones of the Cherry Creek District. These common characteristics are listed here. Hosted within a carbonate rich environment, i.e.: limestone. Occurrences within quartz carbonate veins, often in coarse crystalline form. Proximity to bedding plane faults. The major tungsten occurrences are within or adjacent to the Exchequer Fault Zone. The mineral Scheelite is usually the only tungsten bearing mineral in the previously mined zones, with Wolframite rarely noted or as a minor accessory mineral. Initial Exploration Programs Based on these common characteristics noted above, exploration thus far for tungsten in the Cherry Creek area has consisted of the following activities: 1.Spectral analysis of the former tungsten production locations with identification of carbonate outcrops. 2.Areas-wide stream sediment sampling. 3.Soil sampling in high-potential areas based on the spectral analysis and stream sediment sample results. 4.Night-time prospecting with portable ultraviolet lamps in high-potential areas. 5.Collection of rock samples for assays. 6.Collection of historic reports and collation of data. Initial Exploration Results 1.Closely-spaced stream sediment sampling indicated that a 10 square kilometer area centered on the Ticup Mine is strongly anomalous with respect to tungsten. Most of the former producing tungsten mines at Cherry Creek are within this area. 2.Soil sampling on the west side of Pinenut Canyon revealed strongly anomalous tungsten. Values up to 38.6 ppm W were recorded over a length of 135m. There are no known mines or prospects in this area. 3.A large area of low-lying hills to the southwest of Cherry Creek contained strongly elevated concentrations of tungsten in stream sediment samples. Values up to 58.2 ppm W were contained in an area of over 3 square kilometers. There are no known mines or prospects in this area. Ongoing Exploration 1.Create a 3D computer database of the Ticup Mine. A review of the historic geologic literature suggests that additional tungsten ore deposits are likely below the existing deposits in close proximity to the Exchequer Fault. 2.Detailed grid soil sampling on the west side of Pinenut Canyon where previous exploration has revealed strongly anomalous tungsten. The area of interest is open to the south, west and east. 3.Grid soil sampling on low-lying hills to the southwest of Cherry Creek where previous exploration has revealed strongly anomalous tungsten in stream sediment samples. 4.Rock-chip sampling of prospective lithologies performed in conjunction with soil sampling. 5.Discovery core drilling in all three areas as targets are developed. 6. Intensive and targeted core drilling program to validate the in-situ reserves The costs to conduct Steps 1 through 4 are projected at $16,640. This will be supervised by Vice President of Exploration Douglas Oliver. Consulting Geologist Richard Dorman would construct the 3D database and participate in the evaluation of the Pinenut and Southeast Target Areas. Carlin Trend Mining Services would collect samples for the soil surveys. These steps, taken together, will take approximately two months to complete and we anticipate these steps to be completed by August 2014. A preliminary estimate for Step 5 is $227,915 for an initial six hole core-drilling program. This program will be supervised by Vice President of Exploration Douglas Oliver. This step will take approximately three months to complete and we anticipate completing Step 5 by November 2014. Once the above work has been undertaken, a more comprehensive picture of the potential for re-establishing a producing tungsten facility can be established. At that point, with the results of Steps 1 – 5 in hand, we will be in a position to develop and execute Step 6, for which we estimate the cost at approximately $1,250,000. This step will take approximately 12 months to complete and we anticipate completing this final step by November 2015. We intend to use the funds available from the Note Purchase Agreement and the Purchase Agreement with Hanover to finance our ongoing exploration plans for the Cherry Creek Property. Sample and Analytical Procedures Samples were collected both by our personnel and by contract samplers provided by Carlin Trend Mining Services. Sample preparation and analysis was conducted by ALS Minerals of Elko, Nevada. Sample preparation protocols varied depending whether the samples were of rock, soil or stream-sediment mediums. Analysis was by multi-element ICP techniques provided by ALS Minerals. QA/QC protocols included keeping all samples in locked storage until delivery to ALS Minerals. ALS Minerals has in-house protocols including blanks, standards and repeat analysis and the results of these checks were reported with the assay results. A review of the results indicates that the samples were professionally analyzed with acceptable levels of precision. Wildhorse Tungsten Project Location The Wildhorse Tungsten Project consists of 42 unpatented mining claims situated in Custer County, Nevada. The project is approximately 50 miles west of Mackay, Idaho. Disturbance and Contamination Issues The Wildhorse Project area saw limited mining and exploration beginning in 1954. Un-reclaimed mines, prospect pits and mine dumps are known to exist in the area. There are no plans to remediate the historic mine sites. Acreage We control 42 unpatented mining claims in the Wildhorse Project area comprising approximately 840 acres. Taxes and assessment work are paid on these claims through August 31, 2014. Mineral Resources and Reserves Tungsten mining began at Wildhorse in 1954 with production sold to the US government stockpile. Total production at the Wildhorse Prospect is estimated at 7,461 STU of WO3. Following closure of the mine in 1957, Bear Creek Mining conducted exploration including drilling at the property. In addition, the US Geological Survey conducted an extensive sampling program in conjunction with a regional mineral resource evaluation. These programs identified three deposits. Historical inferred resource estimates are given as 200,000 tons grading 0.70% WO3 at the Steep Climb Prospect, 100,000 tons grading 0.60% WO3 at the Hard to Find Prospect, and 1,400,000 tons grading 0.32% WO3 at the Pine Mouse Prospect. Water and Power While the Wildhorse Prospect is accessible by improved dirt roads, no source of water or power has been identified. Mineralization Most of the tungsten occurrences of south-central Idaho are concentrated in a northwest-trending zone which outs obliquely across the margin of the Idaho batholith. Although this tungsten belt parallels some faults and anticlines of the Cenozoic age, the mineralization was probably localized by older structures developed during the Laramide orogeny. The tungsten deposits are found mainly in altered sedimentary rocks near contacts with granitic rocks. The host rocks include quartzite, argillite, and marble, as well as granitic rocks, and they range in age from pre-Cambrian to late Cretaceous or early Tertiary. The ore mineral in the Wildhorse deposits is scheelite found within tactite. Tactite is an epidote or garnet-rich rock formed by local replacement and recrystallization of calcareous rock. In the Wildhorse area tactite forms only in impure marble adjacent to "alaskite" dikes. All marble bands found in this area are less than 50 feet thick and the economically important ones at the Steep Climb, Hard to Find, and Beaver deposits probably average 10-15 feet in thickness. Proposed Exploration Program Limited exploration consisting of data review and a preliminary field examination are planned. These activities will be supervised by Vice President of Exploration Douglas Oliver. The expenses relating our limited exploration program will be minimal. Impairment As the decision has been made to focus our efforts on developing the Cherry Creek property as a first priority given our limited resources, and having not completed any new exploratory work yielding results that would support the asset value being carried in the books of the Company, management made the decision to fully impair the original stock value exchange for the property. LEGAL PROCEEDINGS There are no material pending legal proceedings to which we are a party or to which any of our property is subject, nor are there any such proceedings known to be contemplated by governmental authorities. None of our directors, officers or affiliates is involved in a proceeding adverse to our business or has a material interest adverse to our business. MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS Market Information Our common shares are quoted on the OTCQB under the symbol "TUNG." The closing bid price for our stock as of March 31, 2014 was $0.06. The following is the range of high and low bid prices for our common stock for the periods indicated. The quotations reflect inter-dealer prices, without retail mark-up, mark-down or commissions and may not represent actual transactions. Fiscal 2013 High Low First Quarter (April 30, 2013) $1.00 $0.85 Second Quarter (July 31, 2013) $1.50 $0.32 Third Quarter (October 31, 2013) $0.34 $0.14 Fourth Quarter (January 31, 2014) $0.18 $0.06 Fiscal 2012 High Low First Quarter (April 30, 2012) $N/A $N/A Second Quarter (July 31, 2012) $N/A $N/A Third Quarter (October 31, 2012) $N/A $N/A Fourth Quarter (January 31, 2013) $N/A $N/A Our common shares are issued in registered form. Securities Transfer Corporation Inc., 2591 Dallas Parkway, Suite 102, Frisco, TX 75034 (Telephone: (469) 633-0101; Facsimile: (469) 633-0088) is the registrar and transfer agent for our common shares. On March 31, 2014, the shareholders' list showed 24 shareholders of record and 73,631,278 common shares outstanding. Dividends We have not paid dividends to date and do not anticipate paying any dividends in the foreseeable future. Our Board of Directors intends to follow a policy of retaining earnings, if any, to finance our growth. The declaration and payment of dividends in the future will be determined by our Board of Directors in light of conditions then existing, including our earnings, financial condition, capital requirements and other factors. MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis of the results of operations and financial condition for the period for the fiscal years ended December 31, 2012 and 2011 and for the six months ended June 30, 2013, should be read in conjunction with the financial statements and related notes and the other financial information that are included elsewhere in this Prospectus. This discussion includes forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives, expectations and intentions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements as a result of a number of factors, including those set forth under the Risk Factors, Cautionary Notice Regarding Forward-Looking Statements and Business sections in this registration statement on Form S-1. We use words such as "anticipate," "estimate," "plan," "project," "continuing," "ongoing," "expect," "believe," "intend," "may," "will," "should," "could," and similar expressions to identify forward-looking statements. Overview We were incorporated under the laws of the state of Nevada on June 5, 2008. On April 8, 2013, we entered into and closed a stock exchange agreement with Guy Martin and Nevada Tungsten Holdings Ltd. Pursuant to the terms of the SEA, we acquired all of the issued and outstanding shares of Nevada Tungsten Holdings Ltd. s common stock from Mr. Martin in exchange for the issuance by our company of 3,000,000 shares of our common stock to Guy Martin (the "Transaction"). As a result of the Transaction, Nevada Tungsten Holdings Ltd. became our wholly-owned subsidiary and we acquired an option to acquire a 100% interest in all tungsten on the Cherry Creek Tungsten Project. Nevada Tungsten Holdings Ltd. was incorporated in the state of Nevada on October 30, 2012, with the goal of investigating for promising tungsten opportunities in the United States. Nevada Tungsten Holdings Ltd. s operations since incorporation focused on the investigation and identification of promising tungsten opportunities, and as a result, it entered into the Option Agreement in regards to Cherry Creek Tungsten Project and the Monfort Agreement in regards to the Idaho Property, both as further described in this Registration Statement on Form S-1. Results of Operations for the Fiscal Years Ended January 31, 2014 and January 31, 2013 The following summary of our results of operations should be read in conjunction with our audited financial statements for the fiscal years ended January 31, 2014 and January 31, 2013. Our operating results for the fiscal years ended January 31, 2014 and January 31, 2013: Fiscal Year Ended January 31, 2014 Fiscal Year Ended January 31, 2013 Revenue $0 $0 Expenses $1,481,142 $23,391 Net Loss $(1,481,142) $(23,391) The net loss for the year was adversely impacted by non-cash expenses of $750,000 in impairment losses on our Idaho property, $162,875 in stock based compensation and $129,050 in derivative expenses stemming from a convertible note, together representing over 70% of the net loss. Revenues We have not earned any revenues for the fiscal years ended January 31, 2014 and January 31, 2013 and we do not anticipate earning revenues in the near future. Expenses Our expenses for the fiscal years ended January 31, 2014 and January 31, 2013: Fiscal Year Ended January 31, 2014 Fiscal Year Ended January 31, 2013 Exploration expenses $73,565 $22,130 General and administrative expenses $114,311 $134 Professional fees $146,061 $1,127 Directors fees $151,875 $Nil Officers compensation $99,067 $Nil Net derivative expenses $129,050 $Nil Interest $17,213 $Nil Our expenses for the fiscal years ended January 31, 2014 and January 31, 2013 were comprised mainly of professional fees paid in connection with the costs associated with our current and periodic report filing and accounting requirements, directors fees, officers compensation, and general and administrative expenses. Purchase of Significant Equipment We do not intend to purchase any significant equipment over the next twelve months. Personnel Plan We do not expect any material changes in the number of employees over the next 12 month period. We do and will continue to outsource contract employment as needed. Liquidity and Financial Condition Overview As of January 31, 2014, we had $27,007 in cash and cash equivalents and a working capital deficiency of $311,762, including $347,080 in current liabilities comprised of $214,050 in derivative liabilities, $15,938 in convertible notes net of discounts, $99,951 in stockholder advances, and accounts payable and accrued expenses of $17,141. For the fiscal year ended January 31, 2014, we used net cash of $439,793 in operations. For the period from October 30, 2012 (inception) to January 31, 2014, we had $681,452 in net cash flow provided by financing activities, representing stockholder advances and proceeds from convertible notes and the sale of our common stock. We intend to conduct exploration activities on our newly optioned and acquired properties over the next twelve months. We estimate our operating expenses and working capital requirements for the next twelve month period to be as follows: Estimated Expenses For the Next Twelve Month Period General, Administrative, and Corporate Expenses $200,000 Operating Expenses $200,000 Exploration $500,000 Total $900,000 In order to provide financing for our planned exploration activities, we entered into the Note Purchase Agreement with Hanover on January 2, 2014. The Note Purchase Agreement provides that, upon the terms and subject to the conditions set forth in the Note Purchase Agreement, Hanover will purchase from us the Convertible Note with an initial principal amount of $127,500 for a purchase price of $85,000, representing an approximately 33.33% original issue discount. We issued the Convertible Note to Hanover on January 2, 2014. On February 18, 2014, we entered into the Purchase Agreement with Hanover. The Purchase Agreement provides that, upon the terms and subject to the conditions set forth therein, Hanover is committed to purchase up to $3,000,000 worth of our common stock, over the 24-month term of the Purchase Agreement. The per share purchase price for these shares of common stock will be equal to 90.0% of the arithmetic average of the lower of (i) the lowest trade price of a share of our common stock on the date the Fixed Draw Down Notice is delivered, which we refer to as the Draw Down Exercise Date, and (ii) the arithmetic average of the three lowest daily VWAPs during the 10 consecutive trading days ending on the trading day immediately preceding the applicable Draw Down Exercise Date. We paid to Hanover a commitment fee for entering into the Purchase Agreement equal to $150,000 in the form of 2,065,177 restricted shares of our common stock, calculated using a per share price of $0.072633. At present, our cash requirements for the next twelve months outweigh the funds available to maintain or develop our properties. Of the $900,000 that we require for the next twelve months, we had $27,007 in cash as of January 31, 2014. Although proceeds from our recent financings with Hanover will provide some of the funds required for our operational expenses, we intend to pursue additional equity financing from private investors or possibly a registered public offering. If we are unable to achieve the necessary additional financing, then we plan to reduce the amounts that we spend on our business activities and administrative expenses in order to be within the amount of capital resources that are available to us. Any failure to secure additional financing may force us to cease our operations. We cannot be sure that our future working capital or cash flows will be sufficient to meet our debt obligations and commitments. Any insufficiency and failure by us to renegotiate such existing debt obligations and commitments would have a negative impact on our business and financial condition, and may result in legal claims by our creditors. Our ability to make scheduled payments on our debt as they become due will depend on our future performance and our ability to implement our business strategy successfully. Failure to pay our interest expense or make our principal payments would result in a default. A default, if not waived, could result in acceleration of our indebtedness, in which case the debt would become immediately due and payable. If this occurs, we may be forced to sell or liquidate assets, obtain additional equity capital or refinance or restructure all or a portion of our outstanding debt on terms that may be less favorable to us. In the event that we are unable to do so, we may be left without sufficient liquidity and we may not be able to repay our debt and the lenders may be able to foreclose on our assets or force us into bankruptcy proceedings or involuntary receivership. Contractual Obligations Table The following table outlines payments due under our significant contractual obligations over the periods shown, exclusive of interest: Payments due by Period Contractual Obligations Less than One to Three to More Than At January 31, 2014 One Year Three Years Five Years Five Years Total Exploration Expenditure Obligations $500,000 $1,000,000 $- $- $1,500,000 Purchase Obligations $150,000 $- $- $- $150,000 The above table outlines our obligations as of January 31, 2014 and does not reflect any changes in our obligations that have occurred after that date. Off-Balance Sheet Arrangements There are no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors. Our principal capital resources have been through the subscription and issuance of common stock, although we have also used stockholder loans and advances from related parties. Going Concern The Company incurred net losses of $1,504,533 since Inception (October 30, 2012) to January 31, 2014 and has commenced limited operations, raising substantial doubt about the company s ability to continue as a going concern. We will seek additional sources of capital through the issuance of debt or equity financing, but there can be no assurance we will be successful in accomplishing its objectives. The ability of the Company to continue as a going concern is dependent on additional sources of capital and the success of the Company s plan. The financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. Critical Accounting Policies Use of Estimates and Assumptions and Critical Accounting Estimates and Assumptions The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date(s) of the financial statements and the reported amounts of revenues and expenses during the reporting period(s). Critical accounting estimates are estimates for which (a) the nature of the estimate is material due to the levels of subjectivity and judgment necessary to account for highly uncertain matters or the susceptibility of such matters to change and (b) the impact of the estimate on financial condition or operating performance is material. The Company s critical accounting estimates and assumptions affecting the financial statements were: (i)Assumption as a going concern: Management assumes that the Company will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business; (ii)Valuation allowance for deferred tax assets: Management assumes that the realization of the Company s net deferred tax assets resulting from its net operating loss ("NOL") carry–forwards for Federal income tax purposes that may be offset against future taxable income was not considered more likely than not and accordingly, the potential tax benefits of the net loss carry-forwards are offset by a full valuation allowance. Management made this assumption based on (a) the Company has incurred recurring losses, (b) general economic conditions, and (c) its ability to raise additional funds to support its daily operations by way of a public or private offering, among other factors. These significant accounting estimates or assumptions bear the risk of change due to the fact that there are uncertainties attached to these estimates or assumptions, and certain estimates or assumptions are difficult to measure or value. Management bases its estimates on historical experience and on various assumptions that are believed to be reasonable in relation to the financial statements taken as a whole under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Management regularly evaluates the key factors and assumptions used to develop the estimates utilizing currently available information, changes in facts and circumstances, historical experience and reasonable assumptions. After such evaluations, if deemed appropriate, those estimates are adjusted accordingly. Actual results could differ from those estimates. Cash and Cash Equivalents The company considers highly liquid financial instruments purchased with a maturity of three months or less to be cash equivalents. Income Taxes The Company accounts for income taxes under Section 740-10-30 of the FASB Accounting Standards Codification, which requires recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred tax assets and liabilities are based on the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the fiscal year in which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the fiscal years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the Statements of Income and Comprehensive Income in the period that includes the enactment date. The Company adopted section 740-10-25 of the FASB Accounting Standards Codification ("Section 740-10-25") with regards to uncertainty income taxes. Section 740-10-25 addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the financial statements. Under Section 740-10-25, the Company may recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent (50%) likelihood of being realized upon ultimate settlement. Section 740-10-25 also provides guidance on de-recognition, classification, interest and penalties on income taxes, accounting in interim periods and requires increased disclosures. The estimated future tax effects of temporary differences between the tax basis of assets and liabilities are reported in the accompanying consolidated balance sheets, as well as tax credit carry-backs and carry-forwards. The Company periodically reviews the recoverability of deferred tax assets recorded on its consolidated balance sheets and provides valuation allowances as management deems necessary. Management makes judgments as to the interpretation of the tax laws that might be challenged upon an audit and cause changes to previous estimates of tax liability. In addition, the Company operates within multiple taxing jurisdictions and is subject to audit in these jurisdictions. In management s opinion, adequate provisions for income taxes have been made for all years. If actual taxable income by tax jurisdiction varies from estimates, additional allowances or reversals of reserves may be necessary. Fair Value of Financial Instruments The Company follows paragraph 820-10-35-37 of the FASB Accounting Standards Codification ("Paragraph 820-10-35-37") to measure the fair value of its financial instruments and paragraph 825-10-50-10 of the FASB Accounting Standards Codification for disclosures about fair value of its financial instruments. Paragraph 820-10-35-37 establishes a framework for measuring fair value in accounting principles generally accepted in the United States of America (U.S. GAAP), and expands disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, Paragraph 820-10-35-37 establishes a fair value hierarchy which prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The three (3) levels of fair value hierarchy defined by Paragraph 820-10-35-37 are described below: Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs other than quoted prices in active markets included in Level 1, which are either directly or indirectly observable as of the reporting date. Level 3 Pricing inputs that are generally observable inputs and not corroborated by market data. Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. The carrying amounts of the Company s financial assets and liabilities, such as cash, accounts payable and accrued expenses approximate their fair values because of the short maturity of these instruments. The Company uses Level 3 of the fair value hierarchy to measure the fair value of the derivative liabilities and revalues its derivative liability at every reporting period and recognizes gains or losses in the statements of operations that are attributable to the change in the fair value of the derivative warrant liability. Transactions involving related parties cannot be presumed to be carried out on an arm's-length basis, as the requisite conditions of competitive, free-market dealings may not exist. Representations about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms equivalent to those that prevail in arm's-length transactions unless such representations can be substantiated. Net Loss Per Common Share Net loss per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock and potentially outstanding shares of common stock during the period to reflect the potential dilution that could occur from common shares issuable through stock options and warrants. The total amount of potentially outstanding dilutive common shares from the conversion of the convertible notes plus accrued interest converted would be 3,962,308 and 0 for the reporting period ended January 31, 2014 or 2013. Stock-Based Compensation The company has not adopted a stock option plan and has not granted any stock options. The company has Restricted Stock Award Agreements with two outside directors for 750,000 shares each vesting on a quarterly basis over three years. The company recognized $151,875 in stock based compensation associated with the two agreements. In addition, the company has an Agreement with one of its vendors to compensate their services over a twelve month period with 2,000,000 shares of restricted stock to be amortized monthly over the period. The company recognized $7,500 in stock based compensation associated with the agreement. Recent Accounting Pronouncements In February 2013, the FASB issued ASU No. 2013-02, "Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income." The ASU adds new disclosure requirements for items reclassified out of accumulated other comprehensive income by component and their corresponding effect on net income. The ASU is effective for public entities for fiscal years beginning after December 15, 2013. In February 2013, the Financial Accounting Standards Board, or FASB, issued ASU No. 2013-04, "Liabilities (Topic 405): Obligations Resulting from Joint and Several Liability Arrangements for which the Total Amount of the Obligation Is Fixed at the Reporting Date." This ASU addresses the recognition, measurement, and disclosure of certain obligations resulting from joint and several arrangements including debt arrangements, other contractual obligations, and settled litigation and judicial rulings. The ASU is effective for public entities for fiscal years, and interim periods within those years, beginning after December 15, 2013. In March 2013, the FASB issued ASU No. 2013-05, "Foreign Currency Matters (Topic 830): Parent's Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity." This ASU addresses the accounting for the cumulative translation adjustment when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business within a foreign entity. The guidance outlines the events when cumulative translation adjustments should be released into net income and is intended by FASB to eliminate some disparity in current accounting practice. This ASU is effective prospectively for fiscal years, and interim periods within those years, beginning after December 15, 2013. In March 2013, the FASB issued ASU 2013-07, "Presentation of Financial Statements (Topic 205): Liquidation Basis of Accounting." The amendments require an entity to prepare its financial statements using the liquidation basis of accounting when liquidation is imminent. Liquidation is imminent when the likelihood is remote that the entity will return from liquidation and either (a) a plan for liquidation is approved by the person or persons with the authority to make such a plan effective and the likelihood is remote that the execution of the plan will be blocked by other parties or (b) a plan for liquidation is being imposed by other forces (for example, involuntary bankruptcy). If a plan for liquidation was specified in the entity s governing documents from the entity s inception (for example, limited-life entities), the entity should apply the liquidation basis of accounting only if the approved plan for liquidation differs from the plan for liquidation that was specified at the entity s inception. The amendments require financial statements prepared using the liquidation basis of accounting to present relevant information about an entity s expected resources in liquidation by measuring and presenting assets at the amount of the expected cash proceeds from liquidation. The entity should include in its presentation of assets any items it had not previously recognized under U.S. GAAP but that it expects to either sell in liquidation or use in settling liabilities (for example, trademarks). The amendments are effective for entities that determine liquidation is imminent during annual reporting periods beginning after December 15, 2013, and interim reporting periods therein. Entities should apply the requirements prospectively from the day that liquidation becomes imminent. Early adoption is permitted. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK As a smaller reporting company, the Company is not required to provide this disclosure. DIRECTORS AND EXECUTIVE OFFICERS All directors of the Company hold office until the next annual meeting of the security holders or until their successors have been elected and qualified. The officers of the Company are appointed by our board of directors and hold office until their death, resignation or removal from office. Our directors and executive officers, their ages, positions held, and duration as such, are as follows: Name Position Held with the Company Age Date First Elected or Appointed Guy Martin President, Chief Executive Officer, Treasurer, Chief Financial Officer and Director 55 April 8, 2013 Douglas Oliver Director, Vice-President Exploration 62 December 14, 2012 Joseph Galda Director, Corporate Secretary 54 May 13, 2013 David Bikerman Director 55 June 24, 2013 Business Experience The following is a brief account of the education and business experience during at least the past five years of our director and executive officer, indicating his principal occupation during that period, and the name and principal business of the organization in which such occupation and employment were carried out. Guy Martin Guy Martin has over 30 years of corporate operational experience, having served in executive capacities for a number of domestic and international companies. From 2005 to 2008, Mr. Martin served as a principal of Backyard Dreams LLC, a residential remodeling company in Davie, Florida. From 2008 to 2010, Mr. Martin served as the Corporate Director of Strategy and Project Management of Intcomex, an information technology product distributor to Latin America located in Miami, Florida. Mr. Martin then served as the Chief Operating Officer of Chukka Caribbean Adventures, an adventure tour operator headquartered in Montego Bay, Jamaica, from 2010 to 2011. In 2011, Mr. Martin formed Blue Moon Advisors, an operations, financial planning and management consulting firm to start-ups, mining and tourism companies and currently serves as both the owner and a consultant. Mr. Martin currently holds the position of Chief Executive Officer at Coyote Resources Inc. (COYR), a publicly traded junior gold and silver exploration company. Mr. Martin has a Bachelor of Science degree in Electrical Engineering from the New Jersey Institute of Technology. We believe that Mr. Martin s business, management and industry experience will be an invaluable resource as we seek to develop our business and further exploration activities. Douglas Oliver Dr. Oliver is a career geologist with 30 years of experience in mineral exploration. Since 2008, Mr. Oliver has served as President of Oliver Geoservices, a business he founded in 2008, which specializes in minerals exploration management, economic evaluations and independent reviews. In 1973, Mr. Oliver received a Bachelor of Science in Geology from Rutgers University, a MBA from the University of Texas at Austin in 1988, and a Ph.D. in Tectonics from Southern Methodist University in 1996. Mr. Oliver's background with business operations led to our conclusion that he should serve as a director in light of our business and structure. Joseph Galda Mr. Galda (age 54) is a corporate finance attorney and is the founder of J.P. Galda & Co., a law firm. Prior to founding his firm, Mr. Galda was counsel to Fox Rothschild LLP (a law firm) (2012 to 2013), President of Corsair Advisors, Inc., a strategic consulting firm (2004 to 2012), and a general partner of Hodgson Russ LLP, a law firm (2000 to 2004), where he practiced as a foreign legal consultant in the firm s Toronto, Ontario office. Since 2005, Mr. Galda has been a director of Secure Energy, Inc., a private company developing a coal to liquids alternative energy project. We believe that Mr. Galda s extensive legal experience will be an invaluable asset in helping to achieve the Company s goals. David Bikerman Mr. Bikerman has been in the mining field for over thirty years and is experienced in all aspects of mining enterprises from exploration through operations. He founded Bikerman Engineering & Technology Associates, Inc. in May 1997 where he offers expert services to the mining industry in financial modeling, exploration and geologic model preparation, geostatistical and reserve analysis, environmental plans, project feasibility, and project design and management. Mr. Bikerman is President and CEO of Golden Ibex, Inc., a privately owned Nevada stock corporation focused on gold and silver mining in Oregon, USA that owns 100% of the patented claims comprising the historic Ibex and Bald Mountain mines. Mr. Bikerman served on the Board of Colombia Goldfields Ltd from 2006-2009, and as CEO of Caribbean Copper & Gold Corporation from 2007-2009. Mr. Bikerman was a director of Megastar Development Corp. from June 2007 to May 2008, and President and CEO of Megastar from October 2007 to May 2008. Mr. Bikerman was President, China Operations for East Delta Resources Corp. from August 1, 2006 to June 2007 and advisor to the Board from May 2006 to July 2007. He was President and CEO of Sino Silver Corp. from June 2005 through dissolution in September 2007. Mr. Bikerman served as the Manager of Mining for RNC Resources Ltd. from February 2005 until May 2006. He was Vice President and Chief Engineer for Greenstone Resources Ltd. from December 1993 to July 1996 and was responsible for technical analysis, project design, and engineering for a Central American gold project. He was Vice President and Manager of Mining of Minas Santa Rosa, S.A. (Panama) from May 1994 to October 1996 and was a member of the Board of Minera Nicaraguense, S. A. (Nicaragua) from May 1995 to December 2006. He worked as an Associate at Behre Dolbear & Co. from September 1989 to May 1994, an international minerals industry consultant based in New York, New York. We believe that Mr. Bikerman s extensive experience in the mining industry will be an invaluable asset in helping to achieve the Company s goals. Mr. Bikerman holds three degrees in mining engineering. In 1981, he earned his Bachelor of Science in Mining Engineering from the University of Pittsburgh. In 1985, he earned his Master of Science in mining engineering from the Henry Krumb School of Mines in Columbia University of New York. In 1995, he earned his Engineer of Mines, also from the Henry Krumb School of Mines at Columbia University. Family Relationships There are no family relationships among our directors or executive officers. Involvement in Certain Legal Proceedings None of our directors, executive officers, promoters or control persons has been involved in any events requiring disclosure under Item 401(f) of Regulation S-K. Compensation Committee Interlocks and Insider Participation As a smaller reporting company, the Company is not required to provide this disclosure. Section 16(a) Beneficial Ownership Reporting Compliance Section 16(a) of the Exchange Act requires our directors, executive officers, and shareholders holding more than 10% of our outstanding Common Stock to file with the SEC initial reports of ownership and reports of changes in beneficial ownership of our Common Stock. Executive officers, directors, and persons who own more than 10% of our Common Stock are required by SEC regulations to furnish us with copies of all Section 16(a) reports they file. Based solely upon a review of Forms 3, 4, and 5 delivered to us as filed with the SEC during our most recent fiscal year, none of our executive officers and directors, and persons who own more than 10% of our Common Stock failed to timely file the reports required pursuant to Section 16(a) of the Exchange Act, except that Mr. Douglas Oliver failed to file a Form 3 in connection with his appointment on December 14, 2012 as an officer and director of the Company. Nominations to the Board of Directors Our directors take a critical role in guiding our strategic direction and oversee the management of the Company. Board candidates are considered based upon various criteria, such as their broad-based business and professional skills and experiences, a global business and social perspective, concern for the long-term interests of the shareholders, diversity, and personal integrity and judgment. In addition, directors must have time available to devote to Board activities and to enhance their knowledge in the growing business. Accordingly, we seek to attract and retain highly qualified directors who have sufficient time to attend to their substantial duties and responsibilities to the Company. In carrying out its responsibilities, the Board will consider candidates suggested by shareholders. If a shareholder wishes to formally place a candidate s name in nomination, however, he or she must do so in accordance with the provisions of the Company s Bylaws. Suggestions for candidates to be evaluated by the proposed directors must be sent to the Board of Directors, c/o Tungsten Corp., 1671 Southwest 105 Lane, Davie, Florida, 33324. Board Leadership Structure and Role on Risk Oversight Guy Martin currently serves as the Company s principal executive officer and a director. The Company determined this leadership structure was appropriate for the Company due to our small size and limited operations and resources. The Board of Directors will continue to evaluate the Company s leadership structure and modify as appropriate based on the size, resources and operations of the Company. It is anticipated that the Board of Directors will establish procedures to determine an appropriate role for the Board of Directors in the Company s risk oversight function. Committees of the Board We do not have a standing nominating committee, but our entire board of directors acts in such capacity. The board of directors of our company does not believe that it is necessary to have a standing nominating committee because we believe that the functions of such committee can be adequately performed by the board of directors. Audit Committee On June 14, 2013, the board of directors of the Company established an Audit Committee for the purpose of (i) overseeing the accounting and financial reporting processes of the Company and audits of the financial statements of the Company; (ii) assisting the board of directors in oversight and monitoring of (a) the integrity of the Company s financial statements, (b) the Company s compliance with legal and regulatory requirements, (c) the independent auditor s qualifications, independence and performance, and (d) the Company s internal accounting and financial controls; (iii) preparing the report that the rules of the SEC require be included in the Company s annual proxy statement; (iv) providing the Company s board of directors with the results of its monitoring and recommendations derived therefrom; and (v) providing to the Board such additional information and materials as it may deem necessary to make the Board aware of significant financial matters that require the attention of the board of directors. The current members of the Audit Committee are Joseph Galda, who serves as both the chairman and the audit committee financial expert, and David Bikerman. Both members of the Audit Committee are "independent directors", as defined in the rules and regulations of the Nasdaq Stock Market, including Nasdaq Rule 5605(a) and any successor rule thereto. A current copy of the Audit Committee Charter was included in the Company s Quarterly Report on Form 10-Q filed on September 19, 2013. Compensation Committee On June 14, 2013, the board of directors of the Company established a Compensation Committee in order to review and make recommendations to the board of directors regarding compensation to be provided to the Company s directors, officers and employees and to make grants under and otherwise administer any equity compensation plans that may be adopted and approved by the board of directors and the stockholders of the Company. The current members of the Compensation Committee are Joseph Galda, who serves as the chairman, and David Bikerman. Each member of the Compensation Committee is "independent," as such term is defined by the rules and regulations of the Nasdaq Stock Market, including Nasdaq Rule 5605(a) and any successor rule thereto and is an "outside director" within the meaning of Section 162(m) of the Internal Revenue Code of 1986, as amended (the "IRC"). A current copy of the Compensation Committee Charter was included in the Company s Quarterly Report on Form 10-Q filed on September 19, 2013. EXECUTIVE COMPENSATION The particulars of the compensation paid to the following persons: (a)our principal executive officer; (b)each of our two most highly compensated executive officers who were serving as executive officers at the end of the fiscal year ended January 31, 2014; and (c)up to two additional individuals for whom disclosure would have been provided under (b) but for the fact that the individual was not serving as our executive officer at the end of the fiscal years ended January 31, 2014, who we will collectively refer to as the named executive officers of the Company, are set out in the following summary compensation table: SUMMARY COMPENSATION TABLE Name and Principal Position Year Salary ($) Bonus ($) Stock Awards ($) Option Awards ($) Non-Equity Incentive Plan Compensation ($) Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) All Other Compensation ($) Total ($) Guy Martin, 2013 60,000 Nil Nil Nil Nil Nil Nil 60,000 President, Chief Executive Officer, Treasurer, Chief Financial Officer and Director (1) 2012 N/A N/A N/A N/A N/A N/A N/A N/A Douglas 2013 40,000 Nil Nil Nil Nil Nil Nil 40,000 Oliver, Vice President of Exploration(2) 2012 Nil Nil Nil Nil Nil Nil Nil Nil Joseph 2013 Nil Nil 151,875 Nil Nil Nil Nil 151,875 Galda, Corporate Secretary and Director(3) 2012 N/A N/A N/A N/A N/A N/A N/A N/A (1) Mr. Martin was appointed the President, Chief Executive Officer, Treasurer, Chief Financial Officer and a Director of the Company on April 8, 2013 (2) Mr. Oliver was appointed the President, Chief Executive Officer, Treasurer, Chief Financial Officer, Secretary and a Director of the Company on December 14, 2012. Mr. Oliver resigned as President, Chief Executive Officer, Treasurer, Chief Financial Officer and Secretary of the Company on April 8, 2013 and was appointed as Vice-President of Exploration. (3) Mr. Galda was appointed the Corporate Secretary and Director of the Company on May 13, 2013. Other than as disclosed below, there are no compensatory plans or arrangements with respect to our executive officers resulting from their resignation, retirement or other termination of employment or from a change of control. Guy Martin – Employment Agreement On July 9, 2013, we entered into an employment agreement with Guy Martin (the "Martin Employment Agreement"), effective as of July 1, 2013, which replaces the previously existing Consulting Agreement between Mr. Martin and the Company that became effective on April 8, 2013. The Martin Employment Agreement provides for Mr. Martin s continued employment as President and Chief Executive Officer of the Company for a term of two years, subject to certain termination rights, during which time he will receive monthly base salary at the rate of $5,000. The Martin Employment Agreement shall be automatically extended for additional one year terms unless either the Company or Mr. Martin provides written notice of their intent not to renew the agreement at least sixty days prior to the expiration of a term. In addition, Mr. Martin is entitled, at the sole and absolute discretion of the Compensation Committee of the Company's Board of Directors, to receive performance bonuses, which may be based upon a variety of factors. Mr. Martin will also be entitled to participate in all employee benefit plans or programs of the Company to the extent that his position, title, tenure, salary, age, health and other qualifications make him eligible to participate in accordance with the terms of the applicable plans or programs. The Company intends to implement an employee stock option plan, and Mr. Martin shall be eligible to receive awards of stock options, restricted stock, restricted stock units, stock appreciation rights, performance units and performance shares or other equity awards pursuant to the employee stock option plan or any other arrangements the Company may have in effect from time to time. The Board or the Committee will determine in its discretion the amount of any such award to Mr. Martin in accordance with the terms of the employee stock option plan in effect at the time of grant. The Martin Employment Agreement contains a non-competition covenant and non-interference (relating to the Company's customers) and non-solicitation (relating to the Company's employees) provisions effective during the term of his employment and for a period of six months after termination with respect to the non-competition covenant and for a period of twenty four months after termination with respect to the non-interference and non-solicitation provisions of the Martin Employment Agreement. Douglas Oliver – Employment Agreement On July 9, 2013, we entered into an employment agreement with Douglas Oliver (the "Oliver Employment Agreement"), effective as of July 1, 2013, which replaces the previously existing Consulting Agreement between Mr. Oliver and the Company that became effective on April 8, 2013. The Oliver Employment Agreement provides for Mr. Oliver s continued employment as Vice President of Exploration of the Company for a term of two years, subject to certain termination rights, during which time he will receive monthly base salary at the rate of $4,000. The Oliver Employment Agreement shall be automatically extended for additional one year terms unless either the Company or Mr. Oliver provides written notice of their intent not to renew the agreement at least sixty days prior to the expiration of a term. In addition, Mr. Oliver is entitled, at the sole and absolute discretion of the Compensation Committee of the Company's Board of Directors, to receive performance bonuses, which may be based upon a variety of factors. Mr. Oliver will also be entitled to participate in all employee benefit plans or programs of the Company to the extent that his position, title, tenure, salary, age, health and other qualifications make him eligible to participate in accordance with the terms of the applicable plans or programs. The Company intends to implement an employee stock option plan, and Mr. Oliver shall be eligible to receive awards of stock options, restricted stock, restricted stock units, stock appreciation rights, performance units and performance shares or other equity awards pursuant to the employee stock option plan or any other arrangements the Company may have in effect from time to time. The Board or the Committee will determine in its discretion the amount of any such award to Mr. Oliver in accordance with the terms of the employee stock option plan in effect at the time of grant. The Oliver Employment Agreement contains a non-competition covenant and non-interference (relating to the Company's customers) and non-solicitation (relating to the Company's employees) provisions effective during the term of his employment and for a period of six months after termination with respect to the non-competition covenant and for a period of twenty four months after termination with respect to the non-interference and non-solicitation provisions of the Oliver Employment Agreement. Outstanding Equity Awards at Fiscal Year-End OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END Option Awards Stock Awards Name (a) Number of Securities Underlying Unexercised options (#) (b) Number of Securities Underlying Unexercised Options (#) (c) Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) (d) Option Exercise Price ($) (e) Option Expiration Date ($) (f) Number of S hares or Units of Stock that have not Vested (#) (g) Market Value of Shares of Units of Stock that Have not Vested ($) (h) Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights that have not Vested (#) (i) Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or other Rights that have not Vested ($) (j) Guy Martin Nil Nil Nil N/A N/A Nil N/A Nil N/A Douglas Oliver Nil Nil Nil N/A N/A Nil N/A Nil N/A Joseph Galda Nil Nil Nil N/A N/A 750,000(1) $56,250 Nil N/A (1) Pursuant to an Amended and Restated Restricted Stock Award Agreement, dated January 31, 2014, Mr. Galda received the right to 750,000 restricted shares of common stock of the Company. 250,000 of these shares vest on April 30, 2014 and 62,500 shares vest on each of the last day of June, September, December and March thereafter until the shares are fully vested on March 31, 2016, subject to Mr. Galda s continued service with the Company. Options Grants in the Fiscal Year Ended January 31, 2014 During the fiscal year ended January 31, 2014, no stock options were granted to our executive officers. Aggregated Options Exercised in the Fiscal Year Ended January 31, 2014 and Year End Option Values There were no stock options exercised during the fiscal year ended January 31, 2014 and no stock options held by our executive officers at the end of the fiscal year ended January 31, 2014. Re-pricing of Options/SARS We did not re-price any options previously granted to our executive officers during the fiscal year ended January 31, 2014. Director Compensation Directors of the Company may be paid for their expenses incurred in attending each meeting of the directors. In addition to expenses, directors may be paid a sum for attending each meeting of the directors or may receive a stated salary as director. No payment precludes any director from serving the Company in any other capacity and being compensated for such service. Members of special or standing committees may be allowed similar reimbursement and compensation for attending committee meetings. During the fiscal year ended January 31, 2014, we did not pay any compensation or grant any stock options to our directors other than the Restricted Stock Awards disclosed in our Annual Report on Form 10-K for the fiscal year ended January 31, 2013 and in our Current Reports on Form 8-K dated May 14, 2013 and February 4, 2014. DIRECTOR COMPENSATION Name Fees Earned Or Paid in Cash ($) Stock Award ($) Option Award ($) Non-Equity Incentive Plan Compensation ($) Nonqualified Deferred Compensation Earnings ($) All Other Compensation ($) (2) Total ($) David Bikerman Nil $56,250(1) Nil Nil Nil Nil $56,250 (1) Pursuant to a Restricted Stock Award Agreement, dated January 31, 2014, Mr. Bikerman received the right to 750,000 restricted shares of common stock of the Company. 187,500 of these shares vest on April 30, 2014 and 62,500 shares vest on each of the last day of June, September, December and March thereafter until the shares are fully vested on June 30, 2016, subject to Mr. Bikerman s continued service with the Company. Pension, Retirement or Similar Benefit Plans There are no arrangements or plans in which we provide pension, retirement or similar benefits for directors or executive officers. We have no material bonus or profit sharing plans pursuant to which cash or non-cash compensation is or may be paid to our directors or executive officers, except that stock options may be granted at the discretion of the board of directors or a committee thereof. Indebtedness of Directors, Senior Officers, Executive Officers and Other Management None of our directors or executive officers or any associate or affiliate of the Company during the last two fiscal years, is or has been indebted to the Company by way of guarantee, support agreement, letter of credit or other similar agreement or understanding currently outstanding. Potential Payments Upon Termination or Change-in-Control SEC regulations state that we must disclose information regarding agreements, plans or arrangements that provide for payments or benefits to our executive officers in connection with any termination of employment or change in control of the company. We currently have no employment agreements with any of our executive officers, nor any compensatory plans or arrangements resulting from the resignation, retirement or any other termination of any of our executive officers, from a change-in-control, or from a change in any executive officer s responsibilities following a change-in-control. As a result, we have omitted this table. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The following table sets forth, as of March 31, 2014, certain information with respect to the beneficial ownership of our common stock by each stockholder known by us to be the beneficial owner of more than 5% of our common stock and by each of our current directors and executive officers. Each person has sole voting and investment power with respect to the shares of common stock. Beneficial ownership consists of a direct interest in the shares of common stock, except as otherwise indicated. Name and Address of Beneficial Owner Amount and Nature of Beneficial Ownership Percentage of Class(1) Guy Martin President, Chief Executive Officer, Treasurer, Chief Financial Officer and Director 1671 Southwest 105 Lane, Davie, Florida, 33324 3,000,000 4.07 % Douglas Oliver Director, Vice-President Exploration 1671 Southwest 105 Lane, Davie, Florida, 33324 3,000,000 4.07 % Joseph Galda Corporate Secretary and Director 1671 Southwest 105 Lane, Davie, Florida, 33324 750,000 1.02 % David Bikerman Director 1671 Southwest 105 Lane, Davie, Florida, 33324 750,000 1.02 % Directors and Executive Officers as a Group 7,500,000 10.19 % 5% Shareholder Hanover Holdings I, LLC 5,988,254 7.72 % (1)Under Rule 13d-3, a beneficial owner of a security includes any person who, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares: (i) voting power, which includes the power to vote, or to direct the voting of shares; and (ii) investment power, which includes the power to dispose or direct the disposition of shares. Certain shares may be deemed to be beneficially owned by more than one person (if, for example, persons share the power to vote or the power to dispose of the shares). In addition, shares are deemed to be beneficially owned by a person if the person has the right to acquire the shares (for example, upon exercise of an option) within 60 days of the date as of which the information is provided. In computing the percentage ownership of any person, the amount of shares outstanding is deemed to include the amount of shares beneficially owned by such person (and only such person) by reason of these acquisition rights. As a result, the percentage of outstanding shares of any person as shown in this table does not necessarily reflect the person s actual ownership or voting power with respect to the number of shares of common stock actually outstanding on March 31, 2014. As of March 31, 2014, there were 73,631,278 shares of Company common stock issued and outstanding. (2) Includes 2,065,177 shares of common stock issued as Initial Commitment Shares and 3,923,077 shares of common stock issuable upon conversion of the Convertible Note. The business address of Hanover is c/o Magna Group, 5 Hanover Square, New York, New York 10004. Hanover s principal business is that of a private investment firm. We have been advised that Hanover is not a member of the Financial Industry Regulatory Authority, or FINRA, or an independent broker-dealer, and that neither Hanover nor any of its affiliates is an affiliate or an associated person of any FINRA member or independent broker-dealer. We have been further advised that Joshua Sason is the Chief Executive Officer and managing member of Hanover and owns all of the membership interests in Hanover, and that Mr. Sason has sole power to vote or to direct the vote and sole power to dispose or to direct the disposition of all securities owned directly by Hanover. Change in Control We are not aware of any arrangement that might result in a change in control of the Company in the future. CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS AND DIRECTOR INDEPENDENCE Except as disclosed below, there have been no transactions or proposed transactions in which the amount involved exceeds the lesser of $120,000 or one percent of the average of our total assets at year-end for the last two completed fiscal years in which any of our directors, executive officers or beneficial holders of more than 5% of the outstanding shares of our common stock, or any of their respective relatives, spouses, associates or affiliates, has had or will have any direct or material indirect interest. On April 8, 2013, we entered into and closed a voluntary share exchange transaction pursuant to the SEA with Guy Martin (our current President, CEO, Treasurer, CFO and Director) and Nevada Tungsten Holdings Ltd. Mr. Martin was the sole shareholder of Nevada Tungsten Holdings Ltd. and pursuant to the terms of the SEA, we acquired all of the issued and outstanding shares of Nevada Tungsten Holdings Ltd. s common stock from Guy Martin in exchange for the issuance by our company of 3,000,000 shares of our common stock to Guy Martin subject to release conditions noted below. On April 8, 2013, we entered into lock up agreements with each of Messrs. Martin and Oliver (our current Vice President of Exploration and Director) in regards to the 3,000,000 shares of our common stock that each hold. Pursuant to the terms of the lock up agreements, in regards to their respective 3,000,000 shares of our common stock, 1,000,000 shares have been released concurrent with the closing of the Transaction, and 1,000,000 shares shall be released on each anniversary thereafter. On July 9, 2013, we entered into an employment agreement with Guy Martin, effective as of July 1, 2013, which provides for Mr. Martin s services as President and Chief Executive Officer of the Company for a term of two years, during which time he will receive monthly base salary at the rate of $5,000. On July 9, 2013, we entered into an employment agreement with Douglas Oliver, effective as of July 1, 2013, for his services as Vice President of Exploration for a term of two years, during which time he will receive monthly base salary at the rate of $4,000. Pursuant to a restricted stock award agreement, dated January 31, 2014, Mr. Bikerman, a director of the Company, received the right to 750,000 restricted shares of common stock of the Company. 187,500 of these shares vest on April 30, 2014 and 62,500 shares vest on each of the last day of June, September, December and March thereafter until the shares are fully vested on June 30, 2016, subject to Mr. Bikerman s continued service with the Company. Pursuant to an amended and restated restricted stock award agreement, dated January 31, 2014, Mr. Galda, our Secretary and director, received the right to 750,000 restricted shares of common stock of the Company. 250,000 of these shares vest on April 30, 2014 and 62,500 shares vest on each of the last day of June, September, December and March thereafter until the shares are fully vested on March 31, 2016, subject to Mr. Galda s continued service with the Company. Review, Approval or Ratification of Transactions with Related Persons We have not adopted a Code of Ethics and we rely on our board to review related party transactions on an ongoing basis to prevent conflicts of interest. Our board reviews a transaction in light of the affiliations of the director, officer or employee and the affiliations of such person s immediate family. Transactions are presented to our board for approval before they are entered into or, if this is not possible, for ratification after the transaction has occurred. If our board finds that a conflict of interest exists, then it will determine the appropriate remedial action, if any. Our board approves or ratifies a transaction if it determines that the transaction is consistent with the best interests of the Company. Director Independence We currently act with four directors, consisting of Guy Martin and Douglas Oliver, neither of whom is independent, and Joseph Galda and David Bikerman, each of whom is independent. We evaluate independence by the standards for director independence established by applicable laws, rules, and listing standards including, without limitation, the standards for independent directors established by The New York Stock Exchange, Inc., the NASDAQ National Market, and the Securities and Exchange Commission. Subject to some exceptions, these standards generally provide that a director will not be independent if (a) the director is, or in the past three years has been, an employee of ours; (b) a member of the director s immediate family is, or in the past three years has been, an executive officer of ours; (c) the director or a member of the director s immediate family has received more than $120,000 per year in direct compensation from us other than for service as a director (or for a family member, as a non-executive employee); (d) the director or a member of the director s immediate family is, or in the past three years has been, employed in a professional capacity by our independent public accountants, or has worked for such firm in any capacity on our audit; (e) the director or a member of the director s immediate family is, or in the past three years has been, employed as an executive officer of a company where one of our executive officers serves on the compensation committee; or (f) the director or a member of the director s immediate family is an executive officer of a company that makes payments to, or receives payments from, us in an amount which, in any twelve-month period during the past three years, exceeds the greater of $1,000,000 or two percent of that other company s consolidated gross revenues. TABLE OF CONTENTS PART I - INFORMATION REQUIRED IN PROSPECTUS Page PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001493753_ariosa_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001493753_ariosa_prospectus_summary.txt
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001496741_hydrophi_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001496741_hydrophi_prospectus_summary.txt
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+In the event of stock splits, stock dividends, or similar transactions involving the Registrant s common stock, the number of Shares registered shall, unless otherwise expressly provided, automatically be deemed to cover the additional securities to be offered or issued pursuant to Rule 416 promulgated under the Securities Act of 1933, as amended (the Securities Act ). This Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. SUMMARY Prospective investors are urged to read this prospectus in its entirety. As used herein the terms we, us, our, the Registrant, and the Company means, Hydrophi Technologies Group, Inc., a Florida corporation, and its wholly owned subsidiary. We were incorporated in the State of Florida on June 18, 2010 as Big Clix Corp. On September 25, 2013, we consummated an amended Agreement and Plan of Merger (the Merger Agreement ) with Hydro Phi Technologies, Inc., a Delaware corporation ( Hydro Phi ), and HPT Acquisition Corp., a Delaware corporation ( HPT ), which was a wholly-owned subsidiary of the Company and established solely to implement the merger. Pursuant to the Merger Agreement, HPT merged with and into Hydro Phi, with Hydro Phi being the surviving company, in an exchange of all the equity securities of the Hydro Phi for common stock of the Company. After the merger, Hydro Phi continues to operate as before, but as a wholly-owned subsidiary of the Company. On October 2, 2013, we changed our name from Big Clix Corp. to Hydrophi Technologies Group, Inc. Our operating subsidiary, Hydro Phi, was founded in 2008, and operated over the next years to develop new clean energy technologies. Through Hydro Phi, the Company makes and sells a system using water-based clean energy technologies that is engineered and functionally designed to provide fuel savings and reduced greenhouse gas emissions for the internal combustion engine. The primary market for the Hydro Phi products initially will be the transportation industry, with a focus on the trucking/logistics, heavy equipment, marine and agriculture segments, where rising fuel costs and emission regulations are driving the development of new technologies to control operating expenses. We believe that our proprietary HydroPlantTM technology may have additional applications in the future, such as in off-grid power generation, where there is reliance on diesel and similar types of internal combustion engines. Our principal office is located at 3404 Oakcliff Road, Suite C6, Doraville, GA 30340. Our telephone number is (404) 974-9910. Item 16 Exhibits Exhibit Number Description 3.1* Articles of Incorporation (Incorporated by reference to the registration statement on Form S-1 filed on July 29, 2010). 3.2* Certificate of Amendment to Articles of Incorporation (incorporated by reference to the Current Report on Form 8-K filed on October 7, 2013). 3.3* By-Laws Articles of Incorporation (Incorporated by reference to the registration statement on Form S-1 filed on July 29, 2010). 5.1 Legal Opinion of Golenbock Eiseman Assor Bell & Peskoe LLP 10.1* Agreement and Plan of Merger, dated July 15, 2013, among the Registrant, HPT Acquisition Corp., and Hydro Phi Technologies, Inc. (incorporated by reference to the Current Report on Form 8-K filed on September 25, 2013). 10.2* Form of Amendment to the Agreement and Plan of Merger (incorporated by reference to the Current Report on Form 8-K filed on September 25, 2013). 10.3* Form of Management Consulting Agreement between Crescendo Communications, LLC and Hydro Phi Technologies, Inc. (incorporated by reference to the Current Report on Form 8-K filed on September 25, 2013). 10.4* Form of Warrant Agreement, issued by Registrant July 24, 2013, in connection with the Management Consulting Agreement with Crescendo Communications, LLC (incorporated by reference to the Current Report on Form 8-K filed on September 25, 2013). 10.5* Form of Warrant Agreement issued by Hydro Phi and assumed by the Registrant Assumption Agreement (incorporated by reference to the Current Report on Form 8-K filed on September 25, 2013). 10.6* Form of Employment Agreement between Registrant (subsidiary) and Roger Slotkin (incorporated by reference to the Current Report on Form 8-K/A filed on December 17, 2013) 10.7* Form of Distribution Agreement with Energia Vehicular Limpia S.A. de C.V. dated August 22, 2013 (incorporated by reference to the Current Report on Form 8-K/A filed on December 17, 2013). 10.8* Securities Purchase Agreement between the Registrant and 31 Group, LLC, dated April 25, 2014 (incorporated by reference to the Current Report on Form 8-K filed on April 29, 2014). 10.9* Form of Convertible Note issued by the Registrant to 31 Group, LLC (incorporated by reference to the Current Report on Form 8-K filed on April 29, 2014). 10.10* Form of Warrant Agreement issued by Registrant to 31 Group, LLC (incorporated by reference to the Current Report on Form 8-K filed on April 29, 2014). 10.11* Form of Registration Rights Agreement between the Registrant and 31 Group, LLC (incorporated by reference to the Current Report on Form 8-K filed on April 29, 2014). 21.1* Subsidiary of the Registrant (previously filed with this Registration Statement, Amendment No. 1) 23.1 Consent of Independent Auditors re financial statements 23.2 Consent of Golenbock Eiseman Assor Bell & Peskoe LLP, included in Item 5.1. 101.INS XBRL Instance Document 101.SCH XBRL Taxonomy Extension Schema 101.CAL XBRL Taxonomy Extension Calculation Linkbase 101.LAB XBRL Taxonomy Extension Label Linkbase 101.PRE XBRL Taxonomy Extension Presentation Linkbase 101.DEF XBRL Taxonomy Extension Definition Linkbase * Previously filed. The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS Subject to Completion, Dated July 22 , 2014 HYDROPHI TECHNOLOGIES GROUP, INC. 32,107,058 This prospectus relates to the resale of up to 32,107,058 Shares of common stock by 31 Group, LLC. The shares of common stock subject to this prospectus include: (i) 13,859,999 shares of common stock issuable upon conversion of the principal amount and interest to be accrued until maturity on the registrant s Convertible Note issued to 31 Group, LLC on April 28, 2014 (the Initial Convertible Note ). Based upon the current market price of the Company s common stock, the amount of the Convertible Note Shares being registered may be in excess of the number of shares into which the Convertible Note may currently be converted, however the parties have agreed upon the aggregate number of shares to be registered to account for market fluctuations. (ii) 15,600,000 shares of common stock issuable upon conversion of the principal amount and the interest to be accrued until maturity of the registrant s additional Convertible Note to be issued to 31 Group, LLC (the Additional Convertible Note ) upon the terms and conditions set forth in the Securities Purchase Agreement, by and between the Company and 31 Group, LLC, dated April 25, 2014 (the Purchase Agreement ). Based upon the current market price of the Company s common stock, the amount of the Convertible Note Shares being registered may be in excess of the number of shares into which the Convertible Note may currently be converted, however the parties have agreed upon the aggregate number of shares to be registered to account for market fluctuations. (iii) 2,647,059 shares of common stock issuable following the exercise of that certain warrant issued on April 28, 2014, in accordance with the Purchase Agreement (the Warrant Shares ). We will not receive any proceeds from the resale of any of the shares offered hereby. We may receive gross proceeds of up to $450,000, if all of the Warrant Shares set forth above are exercised for cash. The proceeds will be used for working capital or general corporate purposes. We will bear all the costs associated with this registration. Our common stock is presently traded on the Pink Sheets under the trading symbol HPTG . THE PURCHASE OF THE SECURITIES OFFERED THROUGH THIS PROSPECTUS INVOLVES A HIGH DEGREE OF RISK. See section entitled "Risk Factors" on pages 6 to 18 of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. You should rely only on the information contained in this prospectus. We have not authorized any other person to provide you with different information. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. The date of this Prospectus is July ____, 2014.
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001497504_plx_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001497504_plx_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..bf4e32acf4927dfdb08fa735e092a59bb6457b5c
--- /dev/null
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@@ -0,0 +1 @@
+Prospectus Summary This summary highlights certain information appearing elsewhere in this prospectus. Because it is only a summary, it does not contain all of the information that you should consider before investing in shares of our common stock and it is qualified in its entirety by, and should be read in conjunction with, the more detailed information appearing elsewhere in this prospectus. Before you decide to invest in our common stock, you should read the entire prospectus carefully, including
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001509190_aratana_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001509190_aratana_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..0de34ef7ca313ef914b44016f17760316c312953
--- /dev/null
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should read this entire prospectus carefully, especially the section in this prospectus entitled Risk Factors beginning on page 13 and our financial statements and the related notes thereto appearing at the end of this prospectus, before making an investment decision. As used in this prospectus, unless the context otherwise requires, references to we, us, our, our company and Aratana refer to Aratana Therapeutics, Inc. and its subsidiaries. Overview Our Company We are a pet therapeutics company focused on the licensing or acquisition, development and commercialization of innovative biopharmaceutical products for cats, dogs and other companion animals. We operate at the intersection of the more than $50 billion annual U.S. pet market and the more than $20 billion annual worldwide animal health market. Our current product portfolio includes over 15 product candidates consisting of small molecule pharmaceuticals and large molecule biologics that target large opportunities in serious medical conditions in pets. Our most advanced products, AT-004 and AT-005, are monoclonal antibodies for treating lymphoma in dogs. AT-004, which treats B-cell lymphoma, received a conditional license from the U.S. Department of Agriculture, or USDA, and is currently marketed by Novartis Animal Health Inc., or Novartis Animal Health. AT-005, which treats T-cell lymphoma, received a conditional license from the USDA in January 2014 and we expect to commence marketing the product later this year. Our other lead products include small molecules directed at treating osteoarthritis pain and inflammation, loss of appetite and post-operative pain in dogs and cats. Our product candidates are designed to enable veterinarians and pet owners to manage pets medical needs safely and effectively, potentially resulting in longer and improved quality of life for pets. Since our initial public offering in June 2013, we have focused on executing our clinical development plan and continuing to expand our product pipeline and further augment our development capabilities. Recently, we acquired Vet Therapeutics, Inc., which provided us with a proprietary antibody-based biologics platform focused on the treatment of lymphoma, and Okapi Sciences N.V., which provided us with a pipeline of antiviral drugs, including product candidates focused on the treatment of herpes and immunodeficiency in cats. As part of these acquisitions, we also obtained two facilities that we are using to develop additional species-specific monoclonal antibodies, antivirals and other small molecules for use as pet therapeutics. In addition, we now have a commercial product and an additional product candidate that we expect to commercialize in 2014, we have more than doubled the size of our product pipeline since June 2013, and we have significantly increased our technology and development infrastructure. We are focused on advancing our product candidates to regulatory approval and believe that we have significantly accelerated our pathway toward becoming a commercial stage company. We believe that the role of pets in the family has significantly evolved over the last two decades. Many pet owners consider pets important members of their families, and they have been increasingly willing to spend money to maintain the health of their pets. Consequently, pets are living longer and, as they do, are exhibiting many of the same signs and symptoms of disease as humans, such as arthritis, cancer, obesity, diabetes and heart disease. Today veterinarians have comparatively few drugs at their disposal that have been specifically approved for use in pets. As a result, veterinarians often must resort to using products approved for use in humans, but not approved, or even formally studied, in pets, relying on key opinion leaders and literature, rather than regulatory review and approval. We believe that pets deserve therapeutics that have been specifically studied and approved by regulatory authorities for each species, and that veterinarians and pet owners will increasingly demand that therapeutics are demonstrated to be safe and effective in pets before using them. We also believe there is an opportunity to leverage the investment in the human biopharmaceutical industry to bring therapeutics to pets in a capital and Table of Contents The information in this preliminary prospectus is not complete and may be changed. We and the selling stockholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state or other jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION DATED JANUARY 28, 2014 PRELIMINARY PROSPECTUS 5,500,000 Shares Common Stock We are offering 4,500,000 shares of our common stock and certain selling stockholders are offering 1,000,000 shares of our common stock. We will not receive any proceeds from the sale of shares of our common stock by any selling stockholders. Our common stock is listed on The NASDAQ Global Market under the symbol PETX. On January 21, 2014, the last reported sale price of our common stock was $18.96 per share. We are an emerging growth company as defined by the Jumpstart Our Business Startups Act of 2012 and, as such, we have elected to comply with certain reduced public company reporting requirements for this prospectus and future filings. Investing in our common stock involves a high degree of risk. See Risk Factors beginning on page 13 of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. PER SHARE TOTAL Public Offering Price $ $ Underwriting Discounts and Commissions(1) Proceeds to Aratana Therapeutics, Inc. before expenses Proceeds to selling stockholders (1) We have agreed to reimburse the underwriters for certain expenses. See Underwriting. Delivery of the shares of common stock is expected to be made on or about , 2014. A selling stockholder has granted the underwriters an option for a period of 30 days to purchase an additional 825,000 shares of our common stock. We will not receive any proceeds from the sale of shares by the selling stockholder if the underwriters exercise this option. Joint Book-Running Managers Jefferies Barclays William Blair Co-Managers JMP Securities Craig-Hallum Capital Group Prospectus dated , 2014. Table of Contents time efficient manner. For example, advances in human medicines have created new therapeutics for managing chronic diseases associated with aging, such as cancer, osteoarthritis, diabetes and cardiovascular diseases. However, these advances have not yet been translated into innovative therapies for pets, notwithstanding the fact that pets are living longer and manifesting many of these same diseases of aging. Moreover, while developing and commercializing therapeutics for humans and pets share a number of characteristics, there are also significant differences that we believe facilitate the development of pet therapeutics and make the market attractive. These differences include the role and economics of veterinary practices and the private pay nature of the veterinary market. Additionally, because the development of pet therapeutics requires fewer clinical studies, involves fewer subjects and trials are conducted directly in the target species, the development of drugs for pets is generally faster, less expensive and more predictable than for human therapeutics. Our Products and Product Candidates We have assembled a portfolio of more than 15 product candidates that are in various stages of development in either cats or dogs, and frequently in both. Our AT-004 monoclonal antibody product for B-cell lymphoma in dogs has received a conditional license from the USDA, the regulatory agency that oversees biologics in animals, and this product is currently being commercialized in the United States and Canada by Novartis Animal Health. Our AT-005 monoclonal antibody product for T-cell lymphoma in dogs has received a conditional license from the USDA and we expect to begin marketing the product later this year. The following table identifies the primary molecules in our current product portfolio: COMPOUND SPECIES INDICATION DEVELOPMENT STATUS EXPECTED NEXT STEP AT-001 Dog Pain and inflammation associated with osteoarthritis Dose selected Initiate pivotal field effectiveness study in first quarter of 2014 Expect U.S. marketing approval in 2016 Cat Pain and inflammation associated with osteoarthritis Pilot studies Dose confirmation study AT-002 Dog Stimulation of appetite Pivotal field effectiveness study Submission for approval Expect U.S. marketing approval in 2016 Cat Stimulation of appetite Pilot studies Dose confirmation study AT-003 Dog Post-operative pain management Proof of concept study Dose confirmation study Initiate pivotal field effectiveness study in second quarter 2014 Expect U.S. marketing approval in 2016 Cat Post-operative pain management Proof of concept study Dose confirmation study AT-004 Dog B-cell lymphoma Submitted pivotal field effectiveness study Currently sold by Novartis Animal Health Full license expected in 2015 AT-005 Dog T-cell lymphoma Completing pivotal field effectiveness study Conditional license received in 2014 Full license expected in 2015 AT-006 Cat Ocular herpes infection Pivotal field study in Europe File for EU review in 2014 Expect U.S. marketing approval in 2017 or 2018 Table of Contents Table of Contents COMPOUND SPECIES INDICATION DEVELOPMENT STATUS EXPECTED NEXT STEP AT-007 Cat Feline immunodeficiency virus infection Pilot study in Europe Initiate field effectiveness study in 2015 Expect U.S. marketing approval in 2017 or 2018 AT-008 Dog Lymphoma Pivotal field effectiveness study Pivotal field effectiveness in the EU in 2014 AT-009 Dog Mast cell tumor Lead selection Pilot studies AT-010 Dog Atopic dermatitis Lead selection Pilot studies AT-011 Dog Parvovirus infections Lead selection Proof of concept study AT-012 Cat Calicivirus infections Lead selection Proof of concept study In addition to the above-listed product candidates, we are evaluating additional molecules for applications in other diseases including lymphoma in cats, seizures in dogs, atopic dermatitis in dogs and other cancers in cats and dogs, and we are researching new product concepts internally with our recently acquired antibody and antiviral research expertise. Furthermore, we have options with two parties for two additional molecules that we are considering licensing for further development. We aim to submit drug applications for U.S. approval for the majority of our existing product candidates and to make similar regulatory filings for European approval. Furthermore, where appropriate, we attempt to develop and submit regulatory filings for therapeutic indications in both cats and dogs, which will be separate products and require separate approval. Our Development Strategy Our strategy is to in-license proprietary compounds from human biopharmaceutical companies and academia or leverage existing insights in human biology applicable in pets and to develop therapeutics specifically for use in pets. We seek to identify human therapeutics that have demonstrated safety and effectiveness in at least two species and are in, or have completed, Phase I or Phase II clinical trials in humans, with well-developed active pharmaceutical ingredient, or API, process chemistry and a well-defined manufacturing process. We also seek to identify products already in development for pets and to license or acquire these products. To date, we have in-licensed and are further developing pharmaceutical compounds from Pacira Pharmaceuticals, Inc., RaQualia Pharma, Inc. and others, and we have acquired Vet Therapeutics and Okapi. In order to successfully execute our plan, we have assembled an experienced management team consisting of veterinarians, physicians, scientists and other professionals that apply the core principles of drug development to the medical needs of pets. The members of our senior management team combined have over 100 years of experience in the animal health and human biopharmaceutical industries, as well as a strong track record of successfully developing and commercializing therapeutics for pets. Our Chief Scientific Officer and our Head of Drug Evaluation and Development have each been actively involved in the development and approval of over 20 animal health products. Our Chief Commercial Officer has been responsible for guiding the launch of 22 animal health products, including three of the most significant brands in companion animal health. We expect to build a commercial organization to market our products in the United States and to leverage distributors in other important geographies. We anticipate building a small sales force targeting pet oncology centers to market AT-005. In addition, we expect to use the time preceding the full commercialization of our product candidates to build veterinarian and pet owner awareness of our company and our products. We believe that our product candidates, if approved, will enable veterinarians to deliver a higher level of medical care to pets while providing an important revenue stream to veterinarians practices. Table of Contents TABLE OF CONTENTS PAGE Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001514514_be-active_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001514514_be-active_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..ca8ea464d38347b62a3070b645a2b3d4fd31b097
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@@ -0,0 +1,4184 @@
+Prospectus Summary
+
+1
+
+Risk Factors
+
+4
+
+Special Note Regarding Forward Looking Statements
+
+11
+
+Use of Proceeds
+
+11
+
+Market for Our Common Stock and Related Stockholder Matters
+
+11
+
+Management s Discussion and Analysis of Financial Condition and Results of Operation
+
+12
+
+Business
+
+17
+
+Management
+
+22
+
+Executive Compensation
+
+24
+
+Certain Relationships and Related Transactions
+
+25
+
+Security Ownership of Certain Beneficial Owners and Management
+
+26
+
+Selling Stockholders
+
+27
+
+Description of Securities
+
+30
+
+Plan of Distribution
+
+33
+
+Legal Matters
+
+34
+
+Experts
+
+34
+
+Where You Can Find Additional Information
+
+35
+
+Index to Financial Statements
+
+F-1
+
+ 
+
+You should rely only on the information contained in this prospectus. We have not authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not making an offer to sell these securities in any jurisdiction where offer or sale is not permitted. You should assume that the information appearing in this prospectus is accurate only as of the date on the front cover of this prospectus. Our business, financial condition, results of operations and prospects may have changed since that date.
+
+ABOUT THIS PROSPECTUS
+
+You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with information different from that contained in this prospectus. The selling stockholders are offering to sell and seeking offers to buy shares of our Common Stock, including shares they acquire upon exercise of their derivative securities, only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of our Common Stock. The prospectus will be updated and updated prospectuses made available for delivery to the extent required by the federal securities laws.
+
+No person is authorized in connection with this prospectus to give any information or to make any representations about us, the selling stockholders, the securities or any matter discussed in this prospectus, other than the information and representations contained in this prospectus. If any other information or representation is given or made, such information or representation may not be relied upon as having been authorized by us or any selling stockholder. This prospectus does not constitute an offer to sell, or a solicitation of an offer to buy the securities in any circumstances under which the offer or solicitation is unlawful. Neither the delivery of this prospectus nor any distribution of securities in accordance with this prospectus shall, under any circumstances, imply that there has been no change in our affairs since the date of this prospectus. The prospectus will be updated and updated prospectuses made available for delivery to the extent required by the federal securities laws.
+
+ 
+
+ 
+
+-i-
+
+Table of Contents
+
+ 
+
+Prospectus Summary
+
+This summary highlights information contained elsewhere in this prospectus. It does not contain all of the information that you should consider before investing in our securities. You should read the entire prospectus carefully, including the section entitled Risk Factors and our consolidated financial statements and the related notes. Some of the statements contained in this prospectus, including statements under Prospectus Summary and Risk Factors as well as those noted in the documents incorporated herein by reference, are forward-looking statements and may involve a number of risks and uncertainties. We note that our actual results and future events may differ significantly based upon a number of factors. The reader should not put undue reliance on the forward-looking statements in this document, which speak only as of the date on the cover of this prospectus.
+
+Corporate Information
+
+Be Active Holdings, Inc. f/k/a Superlight, Inc. ( we or the Company ) was incorporated as a Delaware corporation on December 27, 2007. On January 9, 2013, the Company entered into an Agreement of Merger and Plan of Reorganization (the Merger Agreement ) with Be Active Brands, Inc., a privately held Delaware corporation ( Be Active ), and Be Active Acquisition Corp., the Company s newly formed, wholly-owned Delaware subsidiary ( Acquisition Sub ). Upon closing of the transaction contemplated under the Merger Agreement (the Merger ), Acquisition Sub merged with and into Be Active, and Be Active, as the surviving corporation, became a wholly-owned subsidiary of the Company.
+
+ Be Active was organized under the laws of the State of Delaware on March 10, 2009. Following its inception, Be Active commenced the manufacturing and sale of its frozen yogurt and ice cream products in the New York metropolitan area during 2009. Distribution of Be Active s products has grown from a limited number of outlets in the New York metro area to over 10 supermarket chains and other retail outlets located in 10 states but has been limited in 2013 as a result of a lack of capital. Be Active s products are distributed principally through warehouse distribution and a local distribution company. Be Active manufactures its product under a co-packing agreement with an ice cream manufacturer located in Lakewood, New Jersey. 
+
+Our executive offices are located at 1010 Northern Blvd, Great Neck, NY 11021, and our telephone number is 212-736-2310.
+
+We manufacture and sell low fat, low calorie, all natural probiotic enriched frozen yogurt and ice cream under the trade name "Jala" and we have trademarked our Jala cow logo. Our frozen yogurt is packaged as low fat sandwiches, bars and pints, which are designed to appeal to the health conscious or weight conscious consumer.
+
+About This Offering
+
+This prospectus includes 158,652,485 shares of Common Stock offered by the Selling Stockholders, consisting of 63,993,768 shares of Common Stock, 55,217,258 shares of Common Stock issuable upon exercise of outstanding warrants and 39,441,459 shares of Common Stock issuable upon conversion of outstanding shares of Series A Convertible Preferred Stock acquired by the Selling Stockholders pursuant to the following transactions:
+
+Private Placement
+
+On January 9, 2013, we entered into subscription agreements with certain investors whereby we sold an aggregate of 3,902,993 units for an aggregate purchase price of $804,999.88. $419,999.88 of the units were sold at a purchase price $0.23 per unit (the January Private Placement ). As part of the January Private Placement (and inclusive in the foregoing), holders of Be Active 10% Notes, in the aggregate principal amount of $385,000 plus accrued interest of $9,612, were, by their terms, automatically converted into units in the January Private Placement at a per unit price of $0.19. Each unit consisted of: (i) one share of our Common Stock, and (ii) a three (3) year warrant to purchase an additional share of Common Stock.
+
+ 
+
+ 
+
+-1-
+
+Table of Contents
+
+The Warrants may be exercised until the third anniversary of their issuance at a cash exercise price of $0.30 per share, subject to adjustment. The Warrants contain anti-dilution protection such that if the Company issues Common Stock prior to the complete exercise of the Warrant for consideration less than the exercise price, then the exercise price shall be reduced to such lower price.
+
+In connection with the January Private Placement, we entered into a Registration Rights Agreement (the Registration Rights Agreement ) with the investors in the January Private Placement whereby the Company agreed to register the shares underlying the units and issuable upon exercise of warrants for resale on a Registration Statement, to be filed with the SEC within 60 days of the final closing of the January Private Placement and to cause such Registration Statement to be declared effective within 120 days of the filing date. On July 2, 2013, we entered into Amendment Agreement No. 3 to the Registration Rights Agreement with the investors representing a majority of the shares subject to the Registration Right Agreement whereby the filing date of the required registration statement was extended to 240 days from the date the final closing of the January Private Placement took place.
+
+On April 25, 2013, we entered into subscription agreements with certain accredited investors whereby we sold an aggregate of 28,333,334 units with gross proceeds to the Company of $850,000 (the April Private Placement ) less $150,000 of offering costs. The offering costs include 2,033,334 units valued at $62,500 for legal fees.
+
+Each unit was sold for a purchase price of $0.03 per unit and consisted of: (i) one share of our Common Stock per share (or at the election of the investor who would, as a result of the purchase of the April Units, hold in excess of 5% of our issued and outstanding Common Stock, one share of our newly designated Series A Convertible Preferred Stock, par value $0.0001 per share, which is convertible into shares of the our Common Stock on a one for one basis) and (ii) a three-year warrant to purchase one additional share of Common Stock at an exercise price of $0.05 per share, subject to adjustment upon the occurrence of certain events such as lower priced issuances, stock splits and dividends.
+
+The warrants may be exercised on a cashless basis and contain limitations on the holder s ability to exercise the warrant in the event such exercise causes the holder to beneficially own in excess of 4.99% of the our issued and outstanding Common Stock, subject to a discretionary waiver in such limitation by the holder upon 61 days notice.
+
+In connection with the April Private Placement, we granted the investors demand registration rights, commencing 30 days after the closing of the April Private Placement and ending one year after the closing of the April Private Placement, pursuant to which the investors holding at least 50% of the outstanding securities sold in the April Private Placement may request, on 60 days notice, the filing of a registration statement with the Securities and Exchange Commission, covering the resale of securities underlying the units. Additionally, we granted the investors piggy-back registration rights for a period of 180 days beginning on the closing date of the April Private Placement.
+
+In connection with the sale of the units, we were required to issue to investors in the Company s January Private Placement, additional shares of Common Stock (or, at the election of such investor who would, as a result of such issuance, become the holder of in excess of 5% of the Company s issued and outstanding Common Stock, shares of Series A Convertible Preferred Stock), in connection with certain anti-dilution protection provided to such prior investors under the terms of the January Private Placement. As a result of the foregoing, we issued an aggregate of an additional (a) 3,789,473 shares of Common Stock (b) 19,191,458 shares of Series A Convertible Preferred Stock and (c) warrants to purchase an additional 22,980,931 shares of Common Stock at an exercise price of $0.03 per share. Furthermore, the exercise price of the warrants issued in the January Private Placement was reduced to a per share exercise price of $0.03.
+
+Estimated use of proceeds
+
+This prospectus relates to shares of our Common Stock that may be offered and sold from time to time by the selling stockholders. We will not receive any of the proceeds resulting from the sale of Common Stock by the selling stockholders.
+
+ 
+
+-2-
+
+Table of Contents
+
+Financial Results
+
+ We reported a net loss of approximately ($938,000) for the year ended December 31, 2012 as compared to a net loss of approximately ($1,277,000) for the year ended December 31, 2011. We expect to incur significant losses into the foreseeable future and our monthly burn rate , or expected cash outflow, for general and administrative costs (including all employee salaries, public company expenses and consultants) is approximately $49,000. Our monthly burn rate for all costs during each month of the third quarter 2013 was approximately $203,000. If we are unable to raise external funding, and eventually generate significant revenues from sales of our products, we will not be able to earn profits or continue operations. It is uncertain that we will generate any operating revenues or ever achieve profitable operations. If we are unsuccessful in addressing these risks, our ability to continue as a going concern will be in substantial doubt. 
+
+ 
+
+ 
+
+ 
+
+As used in this prospectus, unless otherwise specified, references to the Company, Be Active, we, our and us refer to Be Active Holdings, Inc. and, unless otherwise specified, its direct and indirect subsidiaries.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+The Offering
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+Common Stock offered by the selling stockholders:
+
+ 
+
+A total offering of 158,652,485 shares from two private placements (the Private Placements ), consisting of 63,993,768 shares of Common Stock, 39,441,459 shares of Common Stock issuable upon conversion of outstanding shares of Series A Convertible Preferred Stock, and 55,217,258 shares of Common Stock issuable upon the exercise of outstanding warrants sold to investors in the Private Placements. The Company granted certain registration rights to the investors in the Private Placements. The registration of the shares of the selling stockholders pursuant to a registration statement of which this prospectus is a part, will satisfy the Company s obligations to the investors in the Private Placements.
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+Common Stock outstanding before and after this offering:
+
+ 
+
+ 93,741,002 (1) and 188,399,719 (2) 
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+Use of proceeds:
+
+ 
+
+We will not receive any proceeds from the sale of shares in this offering by the selling stockholders.
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+OTC Bulletin Board symbol:
+
+ 
+
+JALA
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+Risk factors:
+
+ 
+
+You should carefully consider the information set forth in this prospectus and, in particular, the specific factors set forth in the Risk Factors section beginning on page 10 of this prospectus before deciding whether or not to invest in shares of our Common Stock.
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+___________________
+
+(1)
+
+ The number of outstanding shares before the offering is based upon 93,741,002 shares outstanding as of February 12, 2014 and excludes 55,217,258 shares of Common Stock issuable upon the exercise of outstanding warrants as well as 39,441,459 shares of Common Stock issuable upon conversion of outstanding shares of Series A Convertible Preferred Stock. 
+
+(2)
+
+The number of outstanding shares after the offering assumes the conversion and sale of the shares of Series A Convertible Preferred stock offered pursuant to this prospectus and the exercise and sale of the warrants offered pursuant to this prospectus.
+
+ 
+
+-3-
+
+Table of Contents
+
+RISK FACTORS
+
+Investing in our Common Stock involves a high degree of risk. Before investing in our Common Stock you should carefully consider the following risks, together with the financial and other information contained in this prospectus. If any of the following risks actually occurs, our business, prospects, financial condition and results of operations could be adversely affected. In that case, the trading price of our Common Stock would likely decline and you may lose all or a part of your investment.
+
+Risks Relating to Operations
+
+We are a new company with a short operating history and have only lost money.
+
+Be Active was formed in March 2009. Our operating history consists of starting our brands, marketing and distribution of our products. We have only shown a loss of money from operations because of the expenses we have incurred in manufacturing, selling and maintaining the administration of Be Active. There is a strong possibility that we will not be able to sell enough of our products to cover or exceed our expenses.
+
+Since we have a limited operating history, it is difficult for potential investors to evaluate our business.
+
+ Our limited operating history makes it difficult for potential investors to evaluate our business or prospective operations. Since our formation, we have not generated enough revenues to exceed our expenses. As an early stage company, we are subject to all the risks inherent in the initial organization, financing, expenditures, complications and delays inherent in a new business. Investors should evaluate an investment in us in light of the uncertainties encountered by developing companies in a competitive environment. Our business is dependent upon the implementation of our business plan. We may not be successful in implementing such plan and cannot guarantee that, if implement, we will ultimately be able to attain profitability. 
+
+We will need to obtain additional financing to fund our operations.
+
+ We do not currently have enough cash flow to operate our business. We will therefore need additional capital (i) to pay slotting fees for supermarket shelf space, (ii) to purchase ingredients and packaging supplies for our co-packers, (iii) to pay co-packers for their services, (iv) to cover general and administrative overhead and (v) to repay outstanding debt and pay interest charges on outstanding debt. Therefore we will be dependent upon additional capital in the form of either debt or equity to continue our operations and expand our products to new markets. At the present time, we do not have arrangements to raise all of the needed additional capital, and we will need to identify potential investors and negotiate appropriate arrangements with them. We may not be able to arrange enough investment within the time the investment is required or that if it is arranged, that it will be on favorable terms. If we cannot get the needed capital, we may not be able to become profitable and may have to curtail or cease our operations. 
+
+We depend heavily on key personnel.
+
+We believe our success depends heavily on the continued active participation of our current executive officers. If we were to lose the services of our executive officers, the loss could have a material adverse effect upon our business, financial condition or results of operations. In addition, to achieve our plans for future growth we will need to recruit, hire, train and retain other highly qualified technical and managerial personnel. Competition for qualified employees is intense, and if we cannot attract, retain and motivate these additional employees their absence could have a materially adverse effect on our business, financial condition or results of operations.
+
+We face strong competition from larger and better-capitalized companies.
+
+Our business is very competitive. Large national or international food companies, with significantly greater resources than we have, manufacture competing products. We expect to continue experiencing strong competition from these larger companies in the form of price, competition for adequate distribution and limited shelf space.
+
+ 
+
+-4-
+
+Table of Contents
+
+In addition, these larger competitors may be able to develop and commercialize new products to compete directly against our products, which may render our products obsolete. If we cannot successfully compete, our marketing and sales will suffer and we may not ever be profitable.
+
+Our products are new and unproven.
+
+ We sell our products only in a limited number of stores and the products are therefore relatively unknown. Initial sales have been good in stores where we currently have our products, but our products may not be accepted in other markets we will try to reach. 
+
+We do not have any patent protection for our intellectual property.
+
+Our intellectual property consists of a proprietary recipe and manufacturing process. Together, these two elements give us the ability to manufacture foods traditionally high in fat and added sugar without fat or added sugar. We decided not to seek a patent for this recipe and process, and the time for us to be able to seek patent protection for our process and recipe has passed. We believe that by treating the recipe and manufacturing process as a trade secret, we will have greater protection than a patent would give us, because a patent would become public knowledge. As a result, the only legal protection for our intellectual property is protection as a trade secret and our trademarks for our Jala brand. If our competitors were to learn our trade secrets, or develop their own methods of manufacturing competitive products, we might not be able to become profitable.
+
+We may become subject to potential claims for product liability.
+
+ Our business could expose us to claims for personal injury from contamination of our products. We believe that the quality of our products is carefully monitored through regular product testing, but we may be subject to liability as a result of customer or distributor misuse or storage. The Company maintains product liability insurance against certain types of claims in amounts which it believes to be adequate. The Company also maintains an umbrella insurance policy that it believes to be adequate to cover claims made above the limits of its product liability insurance. Although no claims have been made against the Company or its distributors to date and the Company believes its current level of insurance to be adequate for its present business operations, it is possible that such claims will arise in the future and it is possible that the Company's policies will not be sufficient to pay for such claims. 
+
+The costs of complying with government regulations may in the future reduce our profit potential.
+
+Our industry is highly regulated by the Federal government, as well as by State and local governments. We are subject to regulation at the federal level by the U.S. Food and Drug Administration and the U. S. Department of Agriculture. Manufacturers of our products must also comply with all federal and local environmental laws and regulations relating to air quality, waste management and other related land use matters. The FDA also regulates finished products by requiring disclosure of ingredients and nutritional information.
+
+State and local laws may impose additional health and cleanliness regulations on our manufacturers. We believe that presently the cost of complying with all of the applicable Federal, State and local governmental laws and regulations is not material to our business. However, to the extent that complying with all of the applicable laws and regulations becomes more burdensome, compliance requirements may adversely affect our profitability by increasing our cost of doing business.
+
+ 
+
+ 
+
+-5-
+
+Table of Contents
+
+We must rely on a number of smaller ice cream distributors, rather than large distributors to distribute our products.
+
+We do not presently have any independent capability to distribute our own product, and we do not believe it is feasible to develop our own distribution business. Consolidation within the ice cream industry has made it more difficult to distribute ice cream products not affiliated with large ice cream distributors. In addition, in some markets the largest ice cream companies control substantially all of the ice cream distribution to supermarkets. Therefore, we must work with a number of independent ice cream distributors, rather than a few large distributors, to distribute our products, both regionally and nationally. Our need to rely upon smaller distributors limits our ability to distribute our products and/or makes that distribution more costly.
+
+One customer accounts for a substantial portion of our sales, increasing both our dependence on a few revenue sources and the risk that our operations will suffer materially if a significant customer stops ordering from us or substantially reduces its business with us.
+
+ Sales to one customer of the Company accounted for approximately 61% and 52% of sales for the years ended December 31, 2012 and 2011, respectively and 63% of sales for the nine months ended September 30, 2013. While our financial performance benefited from substantial sales to one customer, because of the magnitude of sales to this customer, our results would suffer if we were to lose its business. Additionally, if this customer, or other significant customers, made substantial reductions in orders or stopped paying their invoices when due, our results of operations would suffer unless we were able to replace the orders or collect on the payments due. 
+
+Increases in prices of commodities needed to manufacture our product could adversely affect profitability.
+
+The ingredients and materials needed to manufacture and package our products are subject to the normal price fluctuations of the commodities markets. Any increase in the price of those ingredients and materials that cannot be passed along to the consumer will adversely affect our profitability. Any prolonged or permanent increase in the cost of the raw ingredients to manufacture our products may in the long term make it more difficult for us to earn a profit.
+
+Our business may be affected by factors outside of our control.
+
+Our ability to increase sales, and to profitably distribute and sell our products, is subject to a number of risks, including changes in our business relationships with our principal distributors, competitive risks such as the entrance of additional competitors into our markets, pricing and technological competition, risks associated with the development and marketing of new products in order to remain competitive and risks associated with changing economic conditions and government regulation.
+
+Difficulties we may encounter managing our growth could adversely affect our results of operations.
+
+We expect that we may experience a period of rapid and substantial growth that may place a strain on our administrative infrastructure. As our business needs expand, we intend to hire additional employees. This expansion may place a significant strain on our managerial and financial resources. To manage the expected growth of our operations and personnel, we will be required to:
+
+ 
+
+improve existing, and implement new, operational, financial and management controls, reporting systems and procedures;
+
+ 
+
+ 
+
+install enhanced management information systems; and
+
+ 
+
+ 
+
+train, motivate and manage our employees.
+
+ 
+
+ 
+
+-6-
+
+Table of Contents
+
+We may not be able to install adequate management information and control systems in an efficient and timely manner, and our current or planned personnel, systems, procedures and controls may not be adequate to support our future operations. If we are unable to manage growth effectively, our business would be seriously harmed.
+
+Risks Relating to our Organization and our Common Stock
+
+Exercise of options and warrants and/or conversion of preferred stock will dilute your percentage of ownership.
+
+ We have reserved for issuance options to purchase up to an aggregate of 8,550,000 shares of Common Stock under our 2013 Equity Incentive Plan. We also have warrants to purchase 55,217,258 shares of our Common Stock issued and outstanding. In addition we also have issued and outstanding shares of Series A Convertible Preferred Stock, which are convertible into an aggregate of 39,441,459 shares of Common Stock and shares of Series B Convertible Preferred Stock, which, using the number of shares issued and outstanding as of February 12, 2014, will be convertible into approximately 36,045,733 shares of Common Stock on April 26, 2014, subject to adjustment based on future issuances of common stock prior to that date. In the future, we may grant additional stock options or issue additional warrants or other convertible securities. The exercise or conversion of stock options, warrants or convertible securities will dilute the percentage ownership of our other stockholders. The dilutive effect of the exercise or conversion of these securities may adversely affect our ability to obtain additional capital. The holders of these securities may be expected to exercise or convert them when we would be able to obtain additional equity capital on terms more favorable than these securities. 
+
+As a result of the Merger, Be Active became a subsidiary of ours and since we are subject to the reporting requirements of federal securities laws, this can be expensive and may divert resources from other projects, thus impairing its ability to grow.
+
+As a result of the Merger, Be Active became a subsidiary of ours and, accordingly, is subject to the information and reporting requirements of the Securities Exchange Act of 1934, as amended (the Exchange Act ), and other federal securities laws, including compliance with the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ). The costs of preparing and filing annual and quarterly reports, proxy statements and other information with the Securities and Exchange Commission (including reporting of the Merger) and furnishing audited reports to stockholders will cause our expenses to be higher than they would have been if Be Active had remained privately held and did not consummate the Merger.
+
+The Sarbanes-Oxley Act and new rules subsequently implemented by the Securities and Exchange Commission have required changes in corporate governance practices of public companies. As a public company, we expect these new rules and regulations to increase our compliance costs in 2013 and beyond and to make certain activities more time consuming and costly. As a public company, we also expect that these new rules and regulations may make it more difficult and expensive for us to obtain director and officer liability insurance in the future and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified persons to serve on our board of directors or as executive officers.
+
+If we fail to establish and maintain an effective system of internal control, we may not be able to report our financial results accurately and timely or to prevent fraud. Any inability to report and file our financial results accurately and timely could harm our reputation and adversely impact the trading price of our Common Stock.
+
+Effective internal control is necessary for us to provide reliable financial reports and prevent fraud. If we cannot provide reliable financial reports or prevent fraud, we may not be able to manage our business as effectively as we would if an effective control environment existed, and our business and reputation with investors may be harmed. As a result, our small size and any future internal control deficiencies may adversely affect our financial condition, results of operation and access to capital. We have not performed an in-depth analysis to determine if historical un-discovered failures of internal controls exist, and may in the future discover areas of our internal control that need improvement.
+
+ 
+
+ 
+
+-7-
+
+Table of Contents
+
+ As of the period ended September 30, 2013, our President and Chief Financial Officer concluded that our disclosure controls and procedures are ineffective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is: (i) recorded, processed, summarized and reported, within the time periods specified in the Commission's rules and forms, and (ii) accumulated and communicated to our management, including our President and Chief Financial Officer, or officers performing similar functions, as appropriate to allow timely decisions regarding required disclosure. 
+
+We have a going concern opinion from our auditors, indicating the possibility that we may not be able to continue to operate. If we cannot continue as a viable entity, our stockholders may lose some or all of their investment in us.
+
+ We have incurred net losses of $ 1,919,485 for the nine months ended September 30, 2013. We anticipated generating losses for the next 12 months. We have generated only $127,854 in revenues for the nine month period ended September 30, 2013. Accordingly, we may be unable to continue operations in the future as a going concern. No adjustment has been made in the accompanying financial statements to the amounts and classification of assets and liabilities which could result should we be unable to continue as a going concern. If we cannot continue as a viable entity, our stockholders may lose some or all of their investment in us. 
+
+ In addition, our independent auditors included an explanatory paragraph in their report on the accompanying financial statements regarding concerns about our ability to continue as a going concern. As a result, we may not be able to obtain additional necessary funding. We may not ever achieve any revenues or profitability. The revenue and income potential of our business and operations are unproven, and the lack of operating history makes it difficult to evaluate the future prospects of our business. 
+
+Our stock price may be volatile.
+
+The stock market in general has experienced volatility that often has been unrelated to the operating performance of any specific public company. The market price of our Common Stock is likely to be highly volatile and could fluctuate widely in price in response to various factors, many of which are beyond our control, including the following:
+
+ 
+
+ 
+
+changes in our industry;
+
+ 
+
+ 
+
+ 
+
+competitive pricing pressures;
+
+ 
+
+ 
+
+ 
+
+our ability to obtain working capital financing;
+
+ 
+
+ 
+
+ 
+
+additions or departures of key personnel;
+
+ 
+
+ 
+
+ 
+
+limited public float in the hands of a small number of persons who sales or lack of sales could result in positive or negative pricing pressure on the market prices of our Common Stock;
+
+ 
+
+ 
+
+ 
+
+sales of our Common Stock;
+
+ 
+
+ 
+
+ 
+
+our ability to execute our business plan;
+
+ 
+
+ 
+
+ 
+
+operating results that fall below expectations;
+
+ 
+
+ 
+
+ 
+
+loss of any strategic relationship;
+
+ 
+
+ 
+
+ 
+
+regulatory developments;
+
+ 
+
+ 
+
+ 
+
+economic and other external factors; and
+
+ 
+
+ 
+
+ 
+
+period-to-period fluctuations in our financial results.
+
+ 
+
+ 
+
+-8-
+
+Table of Contents
+
+In addition, the securities markets have from time to time experienced significant price and volume fluctuations that are unrelated to the operating performance of particular companies. These market fluctuations may also materially and adversely affect the market price of our Common Stock.
+
+We are subject to the reporting requirements of federal securities laws, this can be expensive and may divert resources from other projects, thus impairing its ability to grow.
+
+We are subject to the information and reporting requirements of the Securities Exchange Act of 1934, as amended , and other federal securities laws, including compliance with the Sarbanes-Oxley Act of 2002. The costs of preparing and filing annual and quarterly reports, proxy statements and other information with the SEC and furnishing audited reports to stockholders will cause our expenses to be higher than they would have been if we had remained privately held.
+
+We have not paid cash dividends in the past and do not expect to pay dividends in the future. Any return on investment may be limited to the value of our Common Stock.
+
+We have never paid cash dividends on our Common Stock and do not anticipate doing so in the foreseeable future. The payment of dividends on our Common Stock will depend on earnings, financial condition and other business and economic factors affecting us at such time as our board of directors may consider relevant. If we do not pay dividends, our Common Stock may be less valuable because a return on your investment will only occur if our stock price appreciates.
+
+There is currently a limited liquid trading market for our Common Stock that arose only recently and we cannot ensure that one will ever be sustained.
+
+A limited liquid trading market for our Common Stock developed only recently. We cannot predict how liquid the market for our Common Stock might become. We received approval from FINRA for our stock to be listed on the Over-the-Counter Bulletin Board on January 9, 2013. Our ticker symbol is JALA . There is currently a limited trading market in our securities. If, for any reason, however, our securities become ineligible for continued quotation on the OTC Bulletin Board or a public trading market does not continue to develop, purchasers of the Common Stock may have difficulty selling their securities should they desire to do so and purchasers of our Common Stock may lose their entire investment if they are unable to sell our securities. Should we fail to satisfy the standards of the OTC Bulletin Board and our Common Stock is suspended from quotation on the OTC Bulletin Board, the trading price of our Common Stock could suffer and the trading market for our Common Stock may be less liquid and our Common Stock price may be subject to increased volatility. Furthermore, for companies whose securities are traded in the OTC Bulletin Board, it is more difficult (1) to obtain accurate quotations, (2) to obtain coverage for significant news events because major wire services generally do not publish press releases about such companies, and (3) to obtain needed capital.
+
+Our Common Stock is currently deemed a penny stock, which makes it more difficult for our investors to sell their shares.
+
+Our Common Stock is subject to the penny stock rules adopted under Section 15(g) of the Exchange Act. The penny stock rules generally apply to companies whose common stock is not listed on The Nasdaq Stock Market or other national securities exchange and trades at less than $5.00 per share, other than companies that have had average revenue of at least $6,000,000 for the last three years or that have tangible net worth of at least $5,000,000 ($2,000,000 if the company has been operating for three or more years). These rules require, among other things, that brokers who trade penny stock to persons other than established customers complete certain documentation, make suitability inquiries of investors and provide investors with certain information concerning trading in the security, including a risk disclosure document and quote information under certain circumstances. Many brokers have decided not to trade penny stocks because of the requirements of the penny stock rules and, as a result, the number of broker-dealers willing to act as market makers in such securities is limited. If we remain subject to the penny stock rules for any significant period, it could have an adverse effect on the market, if any, for our securities. If our securities are subject to the penny stock rules, investors will find it more difficult to dispose of our securities.
+
+ 
+
+ 
+
+-9-
+
+Table of Contents
+
+Offers or availability for sale of a substantial number of shares of our Common Stock may cause the price of our Common Stock to decline.
+
+If our stockholders sell substantial amounts of our Common Stock in the public market upon the expiration of any statutory holding period, under Rule 144, or issued upon the exercise of outstanding warrants or conversion of outstanding shares of Series A Convertible Preferred Stock, it could create a circumstance commonly referred to as an overhang and in anticipation of which the market price of our Common Stock could fall. The existence of an overhang, whether or not sales have occurred or are occurring, also could make more difficult our ability to raise additional financing through the sale of equity or equity-related securities in the future at a time and price that we deem reasonable or appropriate.
+
+ Investor relations activities may affect the price of our Common Stock. 
+
+We expect to utilize various techniques such as non-deal road shows and investor relations campaigns in order to create investor awareness for our company. These campaigns may include personal, video and telephone conferences with investors and prospective investors in which our business practices are described. We may provide compensation to investor relations firms and pay for newsletters, websites, mailings and email campaigns that are produced by third-parties based upon publicly-available information concerning us. We will not be responsible for the content of analyst reports and other writings and communications by investor relations firms not authored by us or from publicly available information. We do not intend to review or approve the content of such analysts reports or other materials based upon analysts own research or methods. Investor relations firms should generally disclose when they are compensated for their efforts, but whether such disclosure is made or complete is not under our control. Our investors may be willing, from time to time, to encourage investor awareness through similar activities. Investor awareness activities may also be suspended or discontinued which may impact the trading market of our Common Stock.
+
+As a result of their existing ownership as well as the issuance of shares of Series B Convertible Preferred Stock, our executive officers and directors own a substantial interest in our voting capital and investors may have limited voice in our management.
+
+As a result of the issuance of shares of our Series B Convertible Preferred Stock to our executive officers and directors, in addition to their existing holdings, our management in the aggregate beneficially owns approximately 40% of our voting capital, including shares of Common Stock issuable upon exercise or conversion within 60 days of the date of this filing. Additionally, the holdings of our officers and directors may increase in the future upon vesting or other maturation of exercise rights under any of the convertible securities they may hold or in the future be granted or if they otherwise acquire additional shares of our Common Stock.
+
+As a result of their ownership and positions, our executive officers and directors collectively may be able to influence all matters requiring shareholder approval, including the following matters:
+
+ 
+
+ 
+
+election of our directors;
+
+ 
+
+ 
+
+amendment of our certificate of incorporation or bylaws; and
+
+ 
+
+ 
+
+effecting or preventing a merger, sale of assets or other corporate transaction.
+
+In addition, their stock ownership may discourage a potential acquirer from making a tender offer or otherwise attempting to obtain control of the Company, which in turn could reduce our stock price or prevent our shareholders from realizing a premium over our stock price.
+
+ 
+
+ 
+
+-10-
+
+Table of Contents
+
+Public company compliance may make it more difficult to attract and retain officers and directors.
+
+The Sarbanes-Oxley Act and new rules subsequently implemented by the SEC have required changes in corporate governance practices of public companies. As a public company, we expect these new rules and regulations to increase our compliance costs in 2013 and beyond and to make certain activities more time consuming and costly. As a public company, we also expect that these new rules and regulations may make it more difficult and expensive for us to obtain director and officer liability insurance in the future and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified persons to serve on our board of directors or as executive officers.
+
+SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
+
+This prospectus contains forward-looking statements. Such statements include statements regarding our expectations, hopes, beliefs or intentions regarding the future, including but not limited to statements regarding our market, strategy, competition, development plans (including acquisitions and expansion), financing, revenues, operations, and compliance with applicable laws. Forward-looking statements involve certain risks and uncertainties, and actual results may differ materially from those discussed in any such statement. Factors that could cause actual results to differ materially from such forward-looking statements include the risks described in greater detail in the following paragraphs. All forward-looking statements in this document are made as of the date hereof, based on information available to us as of the date hereof, and we assume no obligation to update any forward-looking statement. Market data used throughout this prospectus is based on published third party reports or the good faith estimates of management, which estimates are based upon their review of internal surveys, independent industry publications and other publicly available information.
+
+You should review carefully the section entitled Risk Factors beginning on page 10 of this prospectus for a discussion of these and other risks that relate to our business and investing in shares of our Common Stock.
+
+USE OF PROCEEDS
+
+The selling stockholders will receive all of the proceeds from the sale of the shares offered by them under this prospectus. We will not receive any proceeds from the sale of the shares by the selling stockholders covered by this prospectus. However, we will generate proceeds from any cash exercise of the warrants by the selling stockholders, if any. There can be no assurance that any of the selling stockholders will exercise all or any of their warrants. We intend to use any proceeds received for general corporate purposes.
+
+MARKET FOR OUR COMMON STOCK AND RELATED STOCKHOLDER MATTERS
+
+Market Information
+
+Effective January 9, 2013, our Common Stock was approved for quotation on the OTC Bulletin Board. Since February 4, 2013 our ticket symbol has been "JALA". There is no established public trading market for our securities with only periodic sporadic activity since February 4, 2013. There can be no assurance that a regular trading market will develop or if developed, may not be sustained. The following table sets forth, for the calendar periods indicated the range of the high and low last reported of the Company s Common Stock, as reported by the OTC Bulletin Board. The quotations represent inter-dealer prices without retail mark-ups, mark-downs or commissions, and may not necessarily represent actual transactions. The quotations may be rounded for presentation.
+
+Period
+
+ 
+
+High
+
+ 
+ 
+
+Low
+
+ 
+
+ July 1 to September 30, 2013 
+
+ 
+
+ $ 
+
+ 0.0396 
+
+ 
+ 
+
+ $ 
+
+ 0.006 
+
+ 
+
+April 1, 2013 to June 30, 2013
+
+ 
+
+$
+
+ 0.059
+
+ 
+ 
+
+$
+
+0.013
+
+ 
+
+January 1, 2013 to March 31, 2013
+
+ 
+
+$
+
+ 1.10
+
+ 
+ 
+
+$
+
+0.05
+
+ 
+
+ 
+
+-11-
+
+Table of Contents
+
+Holders
+
+ As of February 12, 2014, we had approximately 57 shareholders of record of our Common Stock. 
+
+Dividend Policy
+
+We have not previously paid any cash dividends on our Common Stock and do not anticipate or contemplate paying dividends on our Common Stock in the foreseeable future. We currently intend to use all our available funds to develop our business. We can give no assurances that we will ever have excess funds available to pay dividends.
+
+Securities Authorized for Issuance under Equity Compensation Plans
+
+ As of December 31, 2013, none of our equity securities were authorized to be issued under any compensation plans (including individual compensation arrangements). 
+
+ On January 9, 2013, we adopted the 2013 Equity Incentive Plan and reserved 8,550,000 shares for issuance thereunder. As of September 30, 2013, no awards were made under the 2013 Equity Incentive Plan. 
+
+MANAGEMENT S DISCUSSION AND ANALYSIS OF
+
+FINANCIAL CONDITION AND RESULTS OF OPERATION
+
+The following discussion and analysis should be read together with our financial statements and the related notes appearing elsewhere in this prospectus. This discussion contains forward-looking statements reflecting our current expectations that involve risks and uncertainties. See Forward-Looking Statements for a discussion of the uncertainties, risks and assumptions associated with these statements. Actual results and the timing of events could differ materially from those discussed in our forward-looking statements as a result of many factors, including those set forth under Risk Factors and elsewhere in this prospectus.
+
+Overview
+
+Be Active was incorporated on March 10, 2009 under the laws of the State of Delaware. We manufacture and sell low fat, low calorie, all natural probiotic enriched frozen yogurt and ice cream under the trade name "Jala" and we trademarked our Jala cow logo. Our frozen yogurt is packaged as low fat sandwiches, bars and pints, which are designed to appeal to the health conscious or weight conscious consumer.
+
+ Following inception, we commenced the manufacturing and sale of our frozen yogurt and ice cream products in the New York metropolitan area during 2009. Distribution of our products has grown from a limited number of outlets in the New York metro area to over 10 supermarket chains and other retail outlets located in 10 states but has been limited in 2013 as a result of a lack of capital. Our products are distributed principally through warehouse distribution and a local distribution company. We manufacture our product under a co-packing arrangement with an ice cream manufacturer located in Lakewood, New Jersey. 
+
+ 
+
+-12-
+
+Table of Contents
+
+Results of Operations
+
+The Year ended December 31, 2012 compared to the Year ended December 31, 2011
+
+The following table presents the results of operations of the Company for the year ended December 31, 2012 compared to the year ended December 31, 2011.
+
+ 
+ 
+
+December 31,
+
+ 
+
+ 
+ 
+
+2012
+
+ 
+ 
+
+2011
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Net Sales
+
+ 
+
+$
+
+1,028,729
+
+ 
+ 
+
+$
+
+1,421,954
+
+ 
+
+Cost of Goods Sold
+
+ 
+ 
+
+1,123,029
+
+ 
+ 
+ 
+
+1,506,921
+
+ 
+
+Gross (Loss) Profit
+
+ 
+ 
+
+(94,300
+
+)
+
+ 
+ 
+
+(84,967
+
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Operating Expenses:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Selling Expenses
+
+ 
+ 
+
+241,513
+
+ 
+ 
+ 
+
+717,350
+
+ 
+
+General and administrative 
+
+ 
+ 
+
+584,299
+
+ 
+ 
+ 
+
+458,459
+
+ 
+
+Depreciation and amortization
+
+ 
+ 
+
+455
+
+ 
+ 
+ 
+
+308
+
+ 
+
+ 
+ 
+ 
+
+826,267
+
+ 
+ 
+ 
+
+1,176,117
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Loss from operations before other expenses
+
+ 
+ 
+
+(920,567
+
+)
+
+ 
+ 
+
+(1,261,084
+
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Other Expenses:
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Interest expense, net
+
+ 
+ 
+
+17,560
+
+ 
+ 
+ 
+
+6,992
+
+ 
+
+Loss on sale of bonds
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+6,922
+
+ 
+
+Miscellaneous expense
+
+ 
+ 
+
+106
+
+ 
+ 
+ 
+
+2,496
+
+ 
+
+ 
+ 
+ 
+
+17,666
+
+ 
+ 
+ 
+
+16,410
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Net loss
+
+ 
+
+$
+
+(938,233
+
+)
+
+ 
+
+$
+
+(1,277,494
+
+)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Net loss per common share (Basic and fully diluted) 
+
+ 
+
+ $ 
+
+ (0.03) 
+
+ 
+ 
+ $ 
+
+ (0.05) 
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Number of shares used to compute net loss per share 
+
+ 
+ 
+
+ 29,377,101 
+
+ 
+ 
+ 
+
+ 28,361,458 
+
+ 
+
+ 
+
+Sales
+
+Gross Sales were $1,787,947 and $2,571,977 for the years ended December 31, 2012 and December 31, 2011, respectively. Reconciling items that included sales discounts, returns and allowances, trade spending, and slotting fees totaled $759,218 and $1,150,023 for the years ended December 31, 2012 and December 31, 2011, respectively. Gross sales as of December 31, 2012 decreased $784,030 or 30% as compared to 2011. This decrease is primarily attributable to the lack of capital necessary for marketing and production.
+
+Cost of Goods Sold
+
+Cost of goods sold for the year ended December 31, 2012 decreased to $1,123,029 from $1,506,921 for the year ended December 31, 2011, a decrease of $383,892 or 25%. The decrease is primarily attributable to the reduced sales and purchases related to the deficiency in working capital.
+
+ 
+
+-13-
+
+Table of Contents
+
+Gross Profit (Loss)
+
+Gross loss for the year ended December 31, 2012 was a loss of $94,300, as compared to a loss of $84,967 for the year ended December 31, 2011, an increase of $9,333 or 11%. The decrease of gross profit was related to the decrease in sales.
+
+Operating Expenses
+
+Operating expenses, consisting of selling, general and administrative expenses, and depreciation and amortization expense, for the year ended December 31, 2012 decreased to $826,267 from $1,176,117 for the year ended December 31, 2011, a decrease of $349,850 or 30%. The decrease is primarily attributable to the officers reduction in salary of $167,520 in 2012 to $11,000 as compared to $178,520 in 2011, in addition to a decrease of $475,837 in selling expenses, offset in part by increases in rent of $29,834, insurance of $60,443 and professional fees of $214,475.
+
+Selling expenses consist primarily of advertising, promotion and marketing fees. Selling expenses for the year ended December 31, 2012 decreased to $241,513 from $717,350 for the year ended December 31, 2011, a decrease of $475,837 or 66%. The decrease is primarily due to the reductions in advertising of $127,537, marketing and promotion of $165,917 and travel expense of $137,499.
+
+General and administrative expenses consist primarily of office, utilities, computer, internet, travel, insurance expenses. General and administrative expenses for the year ended December 31, 2012 increased to $584,299 from $458,459 for the year ended December 31, 2011, an increase of $125,840 or 27%. The increase is primarily attributable to the increases in legal and accounting fees totaling $214,475 related to the capital raise and subsequent merger.
+
+Other Expenses
+
+Other expenses were $17,666 for the year ended December 31, 2012, as compared to $16,410 for the year ended December 31, 2011, an increase of $1,256 or 7%, as a result of increased interest expense, offset by the loss on sale of bonds in 2011.
+
+Net Loss
+
+Net loss for the year ended December 31, 2012 decreased to $938,233 from $1,277,494 for year ended December 31, 2011, a decrease in loss of $339,261 or 27%. This decrease is due primarily to the reduction in selling expenses and cost of goods due to the deficiency of working capital.
+
+ The Nine Months Ended September 30, 2013 Compared to the Nine Months Ended September, 2012 
+
+ The following table presents the results of operations of the Company for the nine months ended September 30, 2013 compared to the nine months ended September 30, 2012. 
+
+ 
+
+ 
+
+-14-
+
+Table of Contents
+
+ 
+ 
+ 
+ September 30, 
+ 
+
+ 
+ 
+ 
+ 2013 
+ 
+ 
+ 
+ 2012 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Net Sales 
+
+ 
+
+ $ 
+
+ 127,854 
+
+ 
+ 
+
+ $ 
+
+ 962,555 
+
+ 
+
+ Cost of Goods Sold 
+
+ 
+ 
+
+ 217,436 
+
+ 
+ 
+ 
+
+ 975,653 
+
+ 
+
+ Gross (Loss) Profit 
+
+ 
+ 
+
+ (89,582 
+
+ ) 
+
+ 
+ 
+
+ (13,098 
+
+ ) 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Operating Expenses: 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Selling Expenses 
+
+ 
+ 
+
+ 94,317 
+
+ 
+ 
+ 
+
+ 219,553 
+
+ 
+
+ General and administrative 
+
+ 
+ 
+
+ 673,687 
+
+ 
+ 
+ 
+
+ 388,952 
+
+ 
+
+ 
+ 
+
+ 
+
+ 1,060,245 
+
+ 
+ 
+ 
+
+ - 
+
+ 
+
+ Depreciation and amortization 
+
+ 
+ 
+
+ 720 
+
+ 
+ 
+ 
+
+ 365 
+
+ 
+
+ 
+ 
+ 
+
+ 1,828,969 
+
+ 
+ 
+ 
+
+ 608,870 
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Loss from operations before other expenses 
+
+ 
+ 
+
+ (1,918,551 
+
+ ) 
+
+ 
+ 
+
+ (621,968 
+
+ ) 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Other Expenses: 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Interest expense, net 
+
+ 
+ 
+
+ 934 
+
+ 
+ 
+ 
+
+ 8,789 
+
+ 
+
+ Loss on sale of bonds 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ - 
+
+ 
+
+ Miscellaneous expense 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ - 
+
+ 
+
+ 
+ 
+ 
+
+ 934 
+
+ 
+ 
+ 
+
+ 8,789 
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Net loss 
+
+ 
+
+ $ 
+
+ (1,919,485 
+
+ ) 
+
+ 
+
+ $ 
+
+ (630,757 
+
+ ) 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Net loss per common share (Basic and fully diluted) 
+
+ 
+
+ $ 
+
+ (0.03) 
+
+ 
+ 
+ $ 
+
+ (0.02) 
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Number of shares used to compute net loss per share 
+
+ 
+ 
+
+ 72,785,907 
+
+ 
+ 
+ 
+
+ 29,379,798 
+
+ 
+
+ 
+
+ Sales 
+
+ Gross Sales were $160,092 and $1,582,063 for the nine months ended September 30, 2013 and 2012, respectively. The decrease in gross sales of $1,421,971, approximately 90%, was primarily due to the lack of capital necessary for marketing and production. In addition, the Company has been focusing on new labeling and packaging of its products. 
+
+ Reconciling items that included sales discounts, returns and allowances, trade spending, and slotting fees totaled $32,238 and $619,508 for the nine months ended September 30, 2013 and 2012, respectively. Net sales for the nine months ended September 30, 2013 decreased $127,854 from $962,555 or 87% as compared to net sales for the nine months ended September 30, 2012. 
+
+ Cost of Goods Sold 
+
+ Cost of goods sold for the nine months ended September 30, 2013 decreased to $217,436 from $975,653 for the nine months ended September 30, 2012, a decrease of $758,217 or 78%. The decrease is primarily attributable to the reduced sales and purchases related to the deficiency in working capital. In addition, approximately $150,000 of the cost of goods sold for the nine months ended September 30, 2013 resulted from the write-off of obsolete packaging materials and the write-off of inventory which reached its expiration date prior to sale. 
+
+ 
+
+ -15- 
+
+ Table of Contents 
+
+ Gross Loss 
+
+ Gross loss for the nine months ended September 30, 2013 was $1,918,551, as compared to $621,968 for the nine months ended September30, 2012, an increase in loss of $1,296,583 or 208%. The increase of gross loss was related to the decrease in sales combined with the increase in operating expenses. 
+
+ Operating Expenses 
+
+ Operating expenses, consisting of selling, general and administrative expenses, and depreciation and amortization expense, for the nine months ended September 30, 2013 increased to $1,828,969 from $608,870 for the nine months ended September 30, 2012, an increase of $1,220,099 or 200%. The increase is primarily attributable to the $1,060,245 in stock-based compensation related to the issuance of the shares of Convertible Series B Preferred Stock, in addition to increases in professional fees of $58,250, officers payroll of $217,174, offset in part by a decrease of $125,236 in selling expenses. 
+
+ Selling expenses consist primarily of advertising, promotion and marketing fees. Selling expenses for the nine months ended September 30, 2013 decreased to $94,317 from $219,553 for the nine months ended September 30, 2012, a decrease of $125,236 or 657%. The decrease is primarily due to the reductions in storage of $28,524 and freight and delivery of $94,376 
+
+ General and administrative expenses consist primarily of office, utilities, computer, internet, travel, insurance expenses. General and administrative expenses for the nine months ended September 30, 2013 increased to $673,687 from $388,952 for the nine months ended September 30, 2012, an increase of $284,735 or 73%. The increase is primarily attributable to the increases in legal and accounting fees, and officer salaries. 
+
+ Other Expenses 
+
+ Other expenses were $934 for the nine months ended September 30, 2013, as compared to $8,789 for the nine months ended September 30, 2012, a decrease of $7,855 or 89%, as a result of decreased interest expense. 
+
+ Net Loss 
+
+ Net loss for the nine months ended September 30, 2013 increased to $1,919,485 from $630,757 for the nine months ended September 30, 2012, an increase in loss of $1,288,728 or 204%., resulting from a reduction in sales due to the deficiency of working capital, combined with increases in operating expenses. 
+
+ Loss per Common Share 
+
+ Basic loss per share for the nine month periods ending September 30, 2013 and 2012 is calculated using the weighted-average number of common shares outstanding during each period after giving retroactive effect in 2012 to the shares issued in January 2013 to the stockholders of Be Active Brands upon consummation of the merger. Diluted loss per share includes potentially dilutive securities such as outstanding options and warrants, using various methods such as the treasury stock or modified treasury stock method in the determination of dilutive shares outstanding during each period. Fully diluted EPS is not provided when the effect is anti-dilutive. When the effect of dilution on loss per share is anti-dilutive, diluted loss per share equals the loss per share. 
+
+ Liquidity and Capital Resources 
+
+ Total current assets at September 30, 2013 were $327,799, current liabilities were $645,101 and we had negative working capital of $317,302 Significant losses from operations have been incurred since inception and there is an accumulated deficit of $4,425,457 as of September 30, 2013. Continuation as a going concern is dependent upon attaining capital to achieve profitable operations while maintaining current fixed expense levels. 
+
+ 
+
+-16-
+
+Table of Contents
+
+Off-Balance Sheet Arrangements
+
+We have no off-balance sheet arrangements, including unrecorded derivative instruments that have or are reasonably likely to have a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources. We have certain warrants and options outstanding but we do not expect to receive sufficient proceeds from the exercise of these instruments unless and until the trading price of our common stock is significantly greater than the applicable exercise prices of the options and warrants and mainly following any necessary registering of underlying securities.
+
+BUSINESS
+
+As used in this prospectus, all references to the Company, we, our and us refer to Be Active Holdings, Inc. and, unless otherwise specified, its direct and indirect subsidiaries.
+
+Overview
+
+Corporate History
+
+Be Active Holdings, Inc. f/k/a Super Light, Inc. ( we or the Company ) was incorporated as a Delaware corporation on December 27, 2007. On December 28, 2012, we amended and restated our Certificate of Incorporation in order to authorize the change of our name to Be Active Holdings, Inc. from Super Light Inc. 
+
+Be Active Brands, Inc. was organized under the laws of the State of Delaware on March 10, 2009.
+
+Our Business
+
+We manufacture and sell low fat, low calorie, all natural probiotic enriched frozen yogurt and ice cream under the trade name "Jala" and have trademarked our Jala cow logo. Our frozen yogurt is packaged as low fat sandwiches, bars and pints, which are designed to appeal to the health conscious or weight conscious consumer.
+
+ Following inception, we commenced the manufacturing and sale of our frozen yogurt and ice cream products in the New York metropolitan area during 2009. Distribution of our products has grown from a limited number of outlets in the New York metro area to over 10 supermarket chains and other retail outlets located in 10 states but has been limited in 2013 as a result of a lack of capital. Our products are distributed principally through warehouse distribution and a local distribution company. We manufacture our product under a co-packing agreement with an ice cream manufacturer located in Lakewood, New Jersey. 
+
+ We had net sales of $1,421,954 in 2011 and $1,028,729 in 2012, as well as $962,555 and $127,854 for the nine month periods ended September 30, 2012 and 2013, respectively. We do not currently have sufficient capital to operate our business, and, we will require additional funding in the future to sustain our operations. There is no assurance that we will have revenue in the future or that we will be able to secure the necessary funding to develop our business. 
+
+Recent Developments
+
+On January 9, 2013, we entered into the Merger Agreement with Be Active and Be Active Acquisition Corp. Upon closing of the transaction contemplated under the Merger Agreement, Be Active Acquisition Corp. merged with and into Be Active, and Be Active, as the surviving corporation, became our wholly-owned subsidiary.
+
+Pursuant to the terms and conditions of the Merger Agreement:
+
+ 
+
+All issued and outstanding shares of Be Active s Class A and Class B common stock were converted into the right to receive an aggregate of 29,502,750 shares of our Common Stock. Under the terms of the Merger Agreement, holders of Be Active s Class A and Class B common stock were treated equally as it relates to consideration paid in connection with the Merger.
+
+ 
+
+ 
+
+-17-
+
+Table of Contents
+
+ 
+
+Following the closing of the Merger, we sold an aggregate of 3,852,403 units in the January Private Placement. $419,999.88 of the units were sold at a per unit price of $0.23. Additionally, and included in the foregoing unit total, an aggregate of $385,000, plus accrued interest of $9,612, of bridge notes of Be Active converted into the January Private Placement at per unit price of $0.19. Each unit consisted of (i) one share of the our Common Stock, and (ii) a three year warrant to purchase one share of Common Stock at an initial exercise price of $0.30 per share.
+
+ 
+
+Immediately following the closing of the Merger and the Private Placement, under the terms of an Agreement of Conveyance, Transfer and Assignment of Assets and Assumption of Obligations, we transferred all of our pre-Merger assets and liabilities to our wholly owned subsidiary, Superlight Holdings, Inc., a Delaware corporation. Thereafter, pursuant to a Stock Purchase Agreement, we transferred all of the outstanding capital stock of Superlight Holdings, Inc. to a former officer and director of the Company in exchange for cancellation of an aggregate of 90,304,397 shares of our Common Stock held by such person.
+
+ 
+
+ 
+
+On April 25, 2013, we entered into subscription agreements with certain accredited investors whereby we sold an aggregate of 28,333,334 units with gross proceeds to us of $850,000. Each unit was sold for a purchase price of $0.03 per unit and consisted of: (i) one share of our Common Stock (or at the election of the investor who would, as a result of the purchase of the units, hold in excess of 5% of our issued and outstanding Common Stock, one share of Series A Convertible Preferred Stock, which is convertible into shares of our Common Stock on a one for one basis) and (ii) a three-year warrant to purchase one share of Common Stock at an initial exercise price of $0.05 per share. The sale of units includes the conversion of certain outstanding amounts for unpaid fees and expenses into units at a per unit offering price totaling $62,500.
+
+ 
+
+In connection with the April Private Placement, the Company was required to issue to the investors in the January Private Placement additional shares of Common Stock (or, at the election of such investor in the January Private Placement who would, as a result of such issuance, become the holder of in excess of 5% of the Company s issued and outstanding Common Stock, shares of Series A Convertible Preferred Stock), in connection with certain anti-dilution protection provided to such investors under the terms of the January Private Placement. As a result of the foregoing, the Company issued an aggregate of an additional (a) 3,789,473 shares of Common Stock (b) 19,191,458 shares of Series A Convertible Preferred Stock and (c) warrants to purchase an additional 22,980,931 shares of Common Stock at an exercise price of $0.03 per share. Furthermore, the exercise price of the warrants issued in the January Private Placement was reduced to a per share exercise price of $0.03.
+
+ 
+
+In connection with the April Private Placement, management determined that it was in the best interest of its shareholders to issue additional shares of Common Stock to certain of the original investors of Be Active, who, as a result of the Merger, became shareholders of the Company. As a result, the Company issued an aggregate of 23,054,778 shares of Common Stock to certain of the former shareholders of Be Active as a result of the significant dilution such shareholders experienced as a result of the April Private Placement. In consideration for such issuance, the shareholders released the Company from actions relating to the Company s reverse merger and various financings as well as from any rights under that certain Agreement of Shareholders of Be Active Brands, Inc. dated as of January 26, 2011.
+
+ 
+
+Additionally, on April 26, 2013, the Company designated four (4) shares of preferred stock, par value $0.0001 per share as Series B Convertible Preferred Stock and issued one share of Series B Convertible Preferred Stock to each of the Company s three members of management, to wit: Saverio Pugliese, David Wolfson and Joseph Rienzi. Each share of Series B Convertible Preferred Stock is entitled to such number of votes on all matters submitted to shareholders that is equal to (i) the product of (a) the number of shares of Series B Convertible Preferred Stock held by such holder, (b) the number of issued and outstanding shares of the Company s Common Stock (taking into account the effective outstanding voting rights of the Series B Convertible Preferred Stock), as of the record date for the vote and (c) 0.13334 less (ii) the number of shares of Common Stock beneficially held by such holder on such date. Additionally, on the six month anniversary date of the date of issuance of the Series B Convertible Preferred Stock, each outstanding share of Series B Convertible Preferred Stock shall automatically, and without further action on the part of the holder, convert into such number of fully paid and non-assessable shares of Common Stock as shall cause the holder to own, along with any other securities of the Company beneficially owned on the conversation date by them, 13.334% of the issued and outstanding Common Stock of the Company, calculated on the conversion date.
+
+ 
+
+ 
+
+-18-
+
+Table of Contents
+
+ 
+
+ 
+
+ On October 25, 2013, we amended our previously filed Certificate of Designation for our shares of Series B Convertible Preferred Stock (the Series B Shares ) to extend the date on which the Series B Shares would automatically convert into such number of fully paid and non-assessable shares of Common Stock as shall cause the holder to own, along with any other securities of the Company beneficially owned on the conversation date by them, 13.334% of the issued and outstanding Common Stock of the Company, from the date six months from the date of issuance of such Series B Shares to such date twelve months from the date of issuance of such Series B Shares (the Amendment ). 
+
+ 
+
+ On January 6, 2014, we executed a Reserve Equity Financing Agreement ( Purchase Agreement ) with AGS Capital Group, LLC ( AGS ), pursuant to which AGS has agreed to purchase from us up to $5,000,000 of our common stock (subject to certain limitations) from time to time over a 36-month period. Also on January 6, 2014, we executed a Registration Rights agreement (the Registration Rights Agreement ), with AGS, pursuant to which the Company will file with the SEC a registration statement (the Registration Statement ) that registers for resale under the Securities Act of 1933, as amended, or the Securities Act, the shares that have been or may be issued to AGS under the Purchase Agreement. 
+
+ 
+
+ We do not have the right to commence any sales to AGS pursuant to the Purchase Agreement until the SEC has declared effective the Registration Statement. Thereafter, we may, from time to time in our sole discretion, direct AGS to purchase up to 25,000,000 shares of our common stock on any such business day, provided that in no event shall AGS purchase more than $250,000 worth of our common stock on any single business day, provided that the number of shares sold on any given business day shall not exceed 350% of the Average Daily Trading Volume (as defined in the Purchase Agreement) and at no point shall we issue to AGS such number of shares which shall cause the number of shares of the our common stock then owned by AGS to meet or exceed 5% of the then outstanding shares of our common stock. The purchase price of the up to 25,000,000 shares that may be sold to AGS under the Purchase Agreement on any business day will be based on the market price of our common stock immediately preceding the time of sale as computed under the Purchase Agreement, subject to adjustment as provided in the Purchase Agreement. 
+
+ 
+
+ 
+
+ 
+
+ On February 4, 2014, the shareholders representing a majority of our then outstanding shares of capital stock permitted to vote thereon approved and permitted us to increase the number of authorized shares of our common stock, par value $0,0001 , from 400,000,000 to 525,000,000 (the "Authorized Amendment"), to be effective upon (i) receiving the approval of our Board of Directors, and subsequently (ii) the filing of an amended Certificate of Incorporation with the Secretary of State of the State of Delaware representing the Authorized Amendment. 
+
+Jala Products.
+
+ We produce high quality, low fat, low calorie, all natural novelty frozen yogurt and ice cream products. Our proprietary frozen yogurt and ice cream are all fat-free and are a result of its proprietary recipe and the quality of the ingredients in the mix. The low fat, frozen yogurt bars, our original product, remains our flagship product comprising approximately 75% of total sales during fiscal 2011, which represents $1,915,826, and 60% of total gross sales during the twelve months ended December 31, 2012, which represents $1,087,961. For the period ended September 30, 2013, the low fat frozen yogurt bars represent 68% or $109,404, and 59% or $948,605 for the period ended September 30, 2012. Jala bars provide consumers with beneficial antioxidants and bacteria flora. Each bar contains approximately 10% of the recommended daily allowance for calcium and about one third of the recommended daily allowances of vitamins A, C and E with only 110 calories. Jala products are made with naturally fermented yogurt using Streptococcus thermophilus and Lactobacillus bulgaricus yogurt cultures with the addition of Lactobacillus acidophilus and Lactobacillus debrueckii bulgaricus bacteria which are clinically shown to promote a healthy digestive system. The frozen yogurt sandwich, introduced in March 2011, consists of two low fat chocolate cookies that complement the frozen yogurt. In 2012, we added a Greek formula to the line and introduced Jala Low Fat Greek Frozen Yogurt in pints. The pints come in seven flavors, Blueberry, Strawberry, Vanilla, Peanut Butter, Pomegranate, Chocolate and Honey Vanilla. The pints are 120 calories per serving and contain 8 grams of protein. The frozen yogurt sandwich contains 2.5 grams of fat per serving. The fat content of the sandwiches is contained in the cookies. Our products are sold under the Jala trade name. Our products are currently available in more than 2,000 stores principally throughout the New England, Mid-Atlantic and Southeastern regions. 
+
+ 
+
+ 
+
+-19-
+
+Table of Contents
+
+We promote brand recognition by packaging our products in a unique and distinctive manner. Each package prominently displays the Jala trade name. The frozen yogurt sandwiches are packaged in clear plastic sealed trays in packages of six. The trays are shrink-wrapped in a clear polywrap for freshness and product protection. Flavor combinations are: vanilla/chocolate and vanilla. In 2013, we plan on introducing several new flavors for the frozen yogurt sandwiches. The bars contain four individually wrapped bars per box. Bar flavor combinations are vanilla blueberry, vanilla pomegranate and a fudge bar.
+
+Markets.
+
+We participate in the ice cream market which is part of a broader frozen dessert market. Our frozen yogurt sandwich and bars are considered novelty ice cream products. Novelty items are separately packaged single servings of a frozen dessert that may or may not contain dairy ingredients. The Food and Drug Administration, which regulates the standards for many foods, has set labeling requirements concerning fat content in ice cream and frozen yogurt. Based upon these requirements, our frozen yogurt sandwich falls within the "low fat" ice cream category, while the bar is a "reduced fat" product. Low fat ice cream contains a maximum of three grams of fat per serving. Reduced fat ice cream contains at least 25% less total fat than the original full fat product (either an average of leading brands, or the company's own brand).
+
+According to an on-line report (www.idfa.org/news--views/media-kits/ice-cream/ice-cream-sales-and-trends/) from the USDA, National Agriculture Statistics Service, over 1.5 billion gallons of ice cream and related frozen desserts were produced in 2011in the United States. Of that amount, reduced fat, light and low-fat products accounted for 20% of the market.
+
+Sales and Distribution.
+
+ We sell our products principally to supermarkets, and to a lesser extent to convenience and other foods stores. Distribution is made through warehouse facilities and commissioned food brokers. Through a 2010 agreement, we have a preferred vendor status with C&S Wholesale Grocers, pursuant to which we pay a monthly fee (based on gross sales) in exchange for allowing us to leverage off of its warehouses, inventory control and billing systems and promotional and advertising campaigns over most of the Northeast Region. We market our products principally through in-store advertising and promotions. During 2011 and 2012, we expanded our distribution to approximately 2,100 new supermarket locations throughout the Eastern region of the United States and in Texas. For the years ended December 31, 2012 and 2011, one customer accounted for approximately 61% and 52% of our sales, respectively and 63% for the nine month period ended September 30, 2013. 
+
+We believe our business generally experiences highest volumes during the winter and spring months and lowest volumes during the late summer and fall months.
+
+We generally enter a new market with three flavors of our bars and two flavors of our frozen yogurt sandwich. Thereafter, dependent upon the level of sales from the introduced product and available cash for slotting fees, additional products may be introduced to the existing market. We have experienced strong product demand and loyalty in each geographical market that we have entered. We believe that product demand is generated principally by our unique product packaging and in store promotions. We also believe that our proprietary mix, which delivers a rich and creamy taste with little fat content, creates strong customer loyalty.
+
+Advertising and marketing generally has been in the form of coupons or advertisements in supermarket flyers.
+
+ We attract new markets through the independent efforts of its principal officers. In each new market, we generally will be required to pay slotting fees to the supermarket for shelf space. These fees are common in most segments of the food industry and vary from chain to chain. Supermarket chains generally are reluctant to give up shelf space to new products when existing products are performing. During the twelve months ended December 31, 2011, we paid approximately $152,000 (or 6% of gross revenues) in slotting fees and during the twelve months ended December 31, 2012, we paid approximately $50,000 (or 3% of gross revenues) in slotting fees. Consequently, our expansion into new markets, if any, may be constrained by cash available to pay for slotting fees. We have paid $-0- in slotting fees for the nine month period ended September 30, 2013.
+
+ 
+
+-20-
+
+Table of Contents
+
+Manufacturing Process.
+
+ Our frozen yogurt sandwiches and bars are manufactured through a co-packing arrangement with Mr. Cookie Face, Inc., of Lakewood, New Jersey. For quality assurance purposes, our products are tested by the manufacturer at each production run. We believe that the manufacturer's capacity will meet our projected production requirements for the foreseeable future. Our low fat Greek frozen yogurt pints are manufactured through a co-packing arrangement with Ronny Brook Farms. Our arrangements with both manufacturers are not exclusive, and we believe that we could use other manufacturers if necessary or advantageous. Under our contract, we pay the manufacturer a fixed fee per case for manufacturing and packing the product. We may cancel the agreement on 30 days notice at any time. We purchase some of our raw materials and packaging supplies from single sources; however, we believes that alternate supply sources are available throughout the country at competitive prices. We have not experienced shortages in the procurement of raw materials or packaging. 
+
+ During years ending December 31, 2012 and 2011, and the nine month period ended September 30, 2013, we did not expend any amounts on research and development costs. 
+
+Regulation.
+
+We are subject to regulation by various governmental agencies, including the U.S. Food and Drug Administration and the U.S. Department of Agriculture. Our manufacturer must comply with federal and local environmental laws and regulations relating to air quality, waste management and other related land use matters. The FDA also regulates finished products by requiring disclosure of ingredients and nutritional information. The FDA can audit us or our manufacturer to determine the accuracy of our disclosure. State laws may also impose additional health and cleanliness regulations on our manufacturers.
+
+We believe that we and our manufacturer are currently in compliance with these laws and regulations and have passed all regulatory inspections necessary for us to sell our product in our current markets. We believe that the cost of compliance with applicable governmental laws and regulations is not materially adverse to our business.
+
+Competition.
+
+Our business is highly competitive. Our products compete on the basis of brand image, quality, and breadth of flavor selection, price, and amount of fat content. Most frozen yogurt and ice cream manufacturers, including full line dairies, the major grocery chains and the other independent ice cream processors, are capable of manufacturing and marketing high quality, low fat or reduced fat frozen yogurt and ice creams. Furthermore, there are relatively few barriers to new entrants in the frozen yogurt and ice cream business. Existing competition includes low fat or reduced fat novelty products offered by Ben and Jerry s, Ciao Bella, Yasso, Stonyfield, as well as "private label" brands produced by or for the major supermarket chains. In addition, we also compete with frozen desserts such as frozen yogurt and sorbet manufactured by Dannon, Healthy Choice and others. Many of these competitive products are manufactured by large national or international food companies, with significantly greater resources than us. We expect strong competition to continue in the form of price, competition for adequate distribution and limited shelf space. However, despite these factors, we believe that the taste and quality of our products and our unique product packaging will enable us to effectively compete in this market.
+
+Product Liability.
+
+We are engaged in a business that could expose us to possible claims for personal injury resulting from contamination of our frozen yogurt and ice cream. While we believe that through regular product testing the quality of our products are carefully monitored, we may be subject to liability due to customer or distributor misuse or storage. We maintain product liability insurance against certain types of claims in amounts which we believe to be adequate. We also maintain an umbrella insurance policy that we believe to be adequate to cover claims made above the limits of our product liability insurance. Although no claims have been made against us or our distributors to date and we believe our current level of insurance to be adequate for our present business operations, there can be no assurances that such claims will not arise in the future or that our policies will be sufficient to pay for such claims.
+
+ 
+
+ 
+
+-21-
+
+Table of Contents
+
+Proprietary Rights.
+
+We own the registered trade name Jala and the trademark Jala cow. In addition, we rely on trade secrets to protect our proprietary mix formulation.
+
+Employees.
+
+ As of February 12, 2014, we have 3 full-time employees, who are our Executive Officers. The Company has no collective bargaining agreements with its employees and believes its relations with its employees are good. 
+
+LEGAL PROCEEDINGS
+
+We are not involved in any pending legal proceeding or litigations and, to the best of our knowledge, no governmental authority is contemplating any proceeding to which we are a party or to which any of our properties is subject, which would reasonably be likely to have a material adverse effect on us.
+
+DESCRIPTION OF PROPERTY
+
+Our executive offices are located at 1010 Northern Blvd, Great Neck, NY 11021. We entered into a five year lease effective as of February 17, 2013 at an annual rent of approximately $39,360.
+
+MANAGEMENT
+
+ The following persons are our executive officers and directors as of February 12, 2014 and hold the positions set forth opposite their respective names. 
+
+Name
+
+ 
+
+Age
+
+ 
+
+Position
+
+Saverio Pugliese
+
+ 
+
+46
+
+ 
+
+President and Director
+
+David Wolfson
+
+ 
+
+51
+
+ 
+
+Chief Financial Officer and Director
+
+Joseph Rienzi
+
+ 
+
+42
+
+ 
+
+Secretary and Director
+
+Saverio Pugliese
+
+Mr. Pugliese, age 46, our President and Director since January 9, 2013, was the co-founder of and served as President of Be Active Brands, Inc. since its inception on March 10, 2009. From July 2004 to March 2009, Mr. Pugliese was a consultant to various companies in the ice cream industry and invested in an ice cream distribution company. From January 27, 1994 to July 2004, Mr. Pugliese was co-founder of and served as President of Silhouette Brands, Inc., a company specializing in manufacturing and selling fat free, novelty ice cream under the trade name "Silhouette" with the Skinny Cow logo. As a result of his experiences, Mr. Pugliese brings to the Company extensive experiences in the frozen ice cream business, along with strong sales and marketing skills. While earning an Associate s Degree in business from Nassau Community College in 1986, he founded SD Brands, Inc., and began manufacturing and marketing Slender Delight Non Fat Ice Cream , a soft serve ice cream mix.
+
+David Wolfson
+
+Mr. Wolfson, age 51, our Chief Financial Officer and Director since January 9, 2013, served as Chief Financial Officer of Be Active Brands, Inc. since its inception on March 10, 2009. From July 2004 through the present time, Mr. Wolfson, while partnering with Mr. Wexler and Mr. Pugliese, managed the New York offices of his CPA firm, Schulman Lobel Wolfson Zand Abruzzo Katzen & Blackman LLP . Mr. Wolfson served as the in-house accountant of Silhouette Brands Inc. from 1996 to July 2004. After earning a Bachelor of Science degree in accounting at S.U.N.Y Binghamton in 1983, Mr. Wolfson was employed by a local CPA firm. He attained his CPA license in 1990. Mr. Wolfson was chosen to be a director of the Company based on his knowledge and familiarity with Be Active Brands since its inception.
+
+ 
+
+-22-
+
+Table of Contents
+
+Joseph Rienzi
+
+Mr. Rienzi, age 42, our Secretary and Director since January 9, 2013, served as Vice President and Secretary of Be Active Brands, Inc. since its inception on March 10, 2009. Prior to Be Active, through the present time, Mr. Rienzi has served as Executive Vice President of Rienzi & Sons, Inc., a company specializing in importing, farming, production and distribution of Italian foods worldwide. As a result of his experiences, Mr. Rienzi brings to the Company extensive experiences in the supermarket business, along with strong sales, marketing and promotional skills. Mr. Rienzi s received his higher education at St. John s University, graduating with an M.B.A. in Executive Management as well as Executive Programs from Harvard, M.I.T. and Universita di L Aquila in Italy.
+
+On January 9, 2013, in conjunction with the Merger, Glenn Kesner resigned his positions as President, Chief Executive Officer, Chief Financial Officer, Secretary and Treasurer, as well as his position serving on the Company s Board of Directors. Mr. Kesner s resignation was not as a result of any disagreements with the Company. In addition, Marc Wexler was appointed and elected as Chief Executive Officer and Chairman of the Company and has since resigned, Mr. Pugliese was appointed and elected as President and Director of the Company, Mr. Wolfson was appointed and elected Chief Financial Officer and Director and Mr. Rienzi was appointed and elected as Secretary and Director.
+
+Our directors hold office until the earlier of their death, resignation or removal or until their successors have been qualified.
+
+There are no family relationships between any of our directors and our executive officers.
+
+Involvement in Certain Legal Proceedings
+
+Except as set forth in the director and officer biographies above, to the Company s knowledge, during the past ten (10) years, none of the Company s directors, executive officers, promoters, control persons, or nominees has been:
+
+ 
+
+the subject of any bankruptcy petition filed by or against any business of which such person was a general partner or executive officer either at the time of the bankruptcy or within two years prior to that time;
+
+ 
+
+convicted in a criminal proceeding or is subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);
+
+ 
+
+subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily enjoining, barring, suspending or otherwise limiting his involvement in any type of business, securities or banking activities; or
+
+ 
+
+found by a court of competent jurisdiction (in a civil action), the Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law.
+
+Corporate Governance
+
+Compensation Committee Interlocks and Insider Participation
+
+ During the fiscal year ended December 31, 2013, all executive officer compensation was determined by our board of directors. 
+
+Board Independence
+
+We currently have three directors serving on our board of directors. We are not a listed issuer and, as such, are not subject to any director independence standards. Using the definition of independence set forth in the rules of the NYSE MKT, none of our directors would be considered independent.
+
+ 
+
+-23-
+
+Table of Contents
+
+ 
+
+EXECUTIVE COMPENSATION
+
+Summary Compensation Table
+
+The table below sets forth, for the last two fiscal years, the compensation earned by our chief executive officer and chief financial officer. No other executive officer had annual compensation in excess of $100,000 during the last two fiscal years:
+
+Summary Compensation Table
+
+ Name and Principal Position 
+
+ 
+
+ Year 
+
+ 
+
+ Salary 
+
+ ($) 
+
+ 
+ 
+
+ Bonus 
+
+ ($) 
+
+ 
+ 
+
+ Stock Awards 
+
+ ($) 
+
+ 
+ 
+
+ Option Awards ($) 
+
+ 
+ 
+
+ Non-Equity Incentive 
+
+ Plan Compensation 
+
+ 
+ 
+
+ Nonqualified Deferred 
+
+ Compensation Earnings 
+
+ 
+ 
+
+ All Other 
+
+ Compensation 
+
+ ($) 
+
+ 
+ 
+
+ Total 
+
+ ($) 
+
+ Marc Wexler, Former Chief Executive Officer and Chairman (1) 
+
+ 
+
+ 2012 
+
+ (7) 
+
+ 
+
+ 5,000 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ 5,000 
+
+ 
+ 
+
+ 2013 
+
+ (7) 
+
+ 
+
+ 14,424 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ 14,424 
+
+ Sam Pugliese, President and Director (2) 
+
+ 
+
+ 2012 
+
+ (7) 
+
+ 
+
+ 5,000 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ 5,000 
+
+ 
+ 
+
+ 2013 
+
+ (7) 
+
+ 
+
+ 92,308 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ 92,308 
+
+ David Wolfson, Chief Financial Officer and Director(3) 
+
+ 
+
+ 2012 
+
+ (7) 
+
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+
+ 2013 
+
+ (7) 
+
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ Glenn Kesner (4) 
+
+ 
+
+ 2011 
+
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+
+ 2013 
+
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ Zeev Joseph Kiper (5) 
+
+ 
+
+ 2012 
+
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+
+ 2013 
+
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ Hana Abu (6) 
+
+ 
+
+ 2012 
+
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+
+ 2013 
+
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+ 
+ 
+
+ -- 
+
+ 
+
+ 
+
+(1)
+
+Resigned from his positions as of March 22, 2013.
+
+ 
+
+(2)
+
+President and Director of Be Active since March 10, 2009. Appointed President and Director of the Company on January 9, 2013.
+
+ 
+
+(3)
+
+Chief Financial Officer and Director of Be Active since March 10, 2009. Appointed Chief Financial Officer and Director of the Company on January 9, 2013. Compensation does not include payments by Be Active to Schulman Lobel Wolfson Zand Abruzzo Katzen & Blackman LLP , a public accounting firm that provides consulting (non-auditing) services to Be Active. Mr. Wolfson is a partner of Schulman Lobel Wolfson Zand Abruzzo Katzen & Blackman LLP .
+
+ 
+
+(4)
+
+Former President, Chief Executive Officer, Chief Financial Officer, Secretary, Treasurer and Director from August 7, 2012 to January 9, 2013.
+
+ 
+
+(5)
+
+Former President, Treasurer and Director from January 22, 2008 to August 7, 2012.
+
+ 
+
+(6)
+
+Former Secretary and Director from October 9, 2008 to August 7, 2012.
+
+ 
+
+(7)
+
+Represents compensation paid as an officer of Be Active during the specified period.
+
+ 
+
+-24-
+
+Table of Contents
+
+Employment Agreements with Executive Officers
+
+Effective January 9, 2013 the Company entered into an employment agreement with its chief executive officer for a term of two years, to be automatically renewed for successive one year periods thereafter unless either party provides written notice of intention not to renew the agreement. The agreement provided for a base annual salary of $150,000, paid in periodic installments in accordance with the Company s regular payroll practices and an annual bonus, subject to clawback provisions, based on reaching certain financial targets as defined. The agreement included other benefits and grants under the Company s 2013 Equity Incentive Plan. On March 22, 2013, the Company s chief executive officer resigned from all positions he held with the Company and is serving as a consultant to the Company for $150,000 per annum, plus other consideration as provided for in his employment agreement. In May 2013, the former executive officer agreed to reduce the annual fee to $90,000 until the Company obtained sufficient capital to increase the compensation to $150,000 per year.
+
+ Effective January 9, 2013 the Company entered into an employment agreement its chief financial officer for a term of two years, to be automatically renewed for successive one year periods thereafter unless either party provides written notice of intention not to renew the agreement. The agreement provided for a base annual salary of $80,000, paid in periodic installments in accordance with the Company s regular payroll practices and an annual bonus, subject to clawback provisions, based on reaching certain financial targets as defined. The agreement includes other benefits and grants under the Company s 2013 Equity Incentive Plan. The chief financial officer has proposed an amendment to the employment agreement providing that the base salary under the agreement be applied to accounting fees to the public accounting firm, where he is a partner, that provides nonaudit services to the Company. Costs incurred pursuant to this agreement for the six months ended September 30, 2013 are included in professional fees. 
+
+Effective January 9, 2013 the Company entered into an employment agreement with its president for a term of two years, to be automatically renewed for successive one year periods thereafter unless either party provides written notice of intention not to renew the agreement. The agreement provided for a base salary of $150,000, paid in periodic installments in accordance with the Company s regular payroll practices and an annual bonus, subject to clawback provisions, based on reaching certain financial targets as defined. The agreement includes other benefits and grants under the Company s 2013 Equity Incentive Plan.
+
+Since the Company currently does not have a Compensation Committee, the current Board of Directors, exclusive of the executive for which the criteria was adopted, unanimously set forth certain financial and strategic milestone that, if achieved, would give rise to the executive s bonus eligibility.
+
+Outstanding Equity Awards at Fiscal Year End
+
+ There were no outstanding equity awards issued to our named executive officers as of December 31, 2013. 
+
+Director Compensation
+
+We have not adopted compensation arrangements for members of our board of directors.
+
+CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
+
+Except as set forth below, during our last completed fiscal year, there have been no transactions, whether directly or indirectly, between the Company and any of its officers, directors or their family members.
+
+Be Active
+
+On January 9, 2008, we issued 3,000,000 shares of its common stock to Mr. Zeev Joseph Kiper, our then President, Treasurer and Director, for cash payment of $300.
+
+On July 20, 2009, we issued 1,000,000 shares of its common stock to Ms. Hana Abu, our then Secretary and Director, for cash payment of of $100.
+
+ 
+
+-25-
+
+Table of Contents
+
+On April 12, 2010, we issued 450,000 shares of its common stock to Ms. Hana Abu, our then Secretary and Director, for cash payment of of $9.000.
+
+Three notes payable, dated 12/31/10, 12/31/10 and 12/31/09, in the amounts of $161,021, $161,021 and $25,555 were issued to two officers, Mr. Wexler and Mr. Pugliese and one former officer, Mr. Haramis of Be Active. In November 2012, Messrs. Wexler and Pugliese advanced $200,000 to Be Active.
+
+Be Active held a revolving credit facility at Signature Bank for $200,000, with interest at the prime rate, plus 1% per annum. The primary obligors on the facility were our former Chief Executive Officer and Chairman, Marc Wexler, and our President and Director, Saverio Pugliese, and the Company is a guarantor. In March 2012, Messrs Wexler and Pugliese were repaid $14,000 each for reimbursed expenses. On November 15, 2012, two Class A common shareholders who were officers of Be Active and currently are officers of the Company advanced Be Active $200,000, the proceeds of which were used to repay $198,000 of the revolving credit facility.
+
+Our Chief Financial Officer, David Wolfson, is a partner of Schulman Lobel Wolfson Zand Abruzzo Katzen & Blackman LLP, a public accounting firm that provides consulting (non-auditing) services to the Company. For the periods ended December 31, 2012 and 2011, we incurred $104,246 and $52,000 respectively, to the accounting firm for accounting, consulting and tax services.
+
+Be Active rented space from a company that is owned by Marc Wexler, our former Chief Executive Officer and Chairman, Saverio Pugliese, our President and Director, and David Wolfson, our Chief Financial Officer and Director. For the year ended December 31, 2012 and 2011, rent paid was $40,334 and $10,500, respectively.
+
+ SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT 
+
+ 
+
+ The following tables set forth certain information as of February 12, 2014 regarding the beneficial ownership of our Common Stock by (i) each person or entity who, to our knowledge, owns more than 5% of our Common Stock; (ii) our executive officers named in the Summary Compensation Table below; (iii) each director; and (iv) all of our executive officers and directors as a group. Unless otherwise indicated in the footnotes to the following table, each person named in the table has sole voting and investment power and that person s address is c/o Be Active Holdings, Inc., 1010 Northern Blvd., Great Neck, NY 11021. Shares of Common Stock subject to options, warrants, conversion rights or other rights currently exercisable or exercisable within 60 days of February 12, 2014, are deemed to be beneficially owned and outstanding for computing the share ownership and percentage of the stockholder holding such options, warrants or other rights, but are not deemed outstanding for computing the percentage of any other stockholder. 
+
+ 
+
+-26-
+
+Table of Contents
+
+ 
+
+ Name of Beneficial Owner 
+
+ 
+
+ Number Of 
+
+ Common 
+
+ Shares 
+
+ Beneficially 
+
+ Owned 
+
+ 
+
+ Percentage 
+
+ Owned (1) 
+
+ 
+
+ Number Of 
+
+ SeriesB 
+
+ Preferred 
+
+ Shares 
+
+ Beneficially 
+
+ Owned 
+
+ 
+
+ Percentage 
+
+ Owned(6) 
+
+ 
+
+ Percentage of 
+
+ Total Voting 
+
+ Power (7) 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Marc Wexler (2) 
+
+ 
+ 
+
+ 2,500,000 
+
+ 
+ 
+
+ 2.7% 
+
+ 
+
+ 0 
+
+ 
+ 
+
+ 0 
+
+ % 
+
+ 
+ 
+ 
+
+ % 
+
+ Saverio Pugliese (3) 
+
+ 
+ 
+
+ 6,839,555 
+
+ 
+ 
+
+ 7.3% 
+
+ 
+
+ 1 
+
+ 
+ 
+
+ 33.33 
+
+ % 
+
+ 
+ 
+
+ 13.3334 
+
+ % 
+
+ David Wolfson (4) 
+
+ 
+ 
+
+ 454,028 
+
+ 
+ 
+
+ * 
+
+ 
+
+ 1 
+
+ 
+ 
+
+ 33.33 
+
+ % 
+
+ 
+ 
+
+ 13.3334 
+
+ % 
+
+ Joseph Rienzi (5) 
+
+ 
+ 
+
+ 6,839,556 
+
+ 
+ 
+
+ 7.3% 
+
+ 
+
+ 1 
+
+ 
+ 
+
+ 33.33 
+
+ % 
+
+ 
+ 
+
+ 13.3334 
+
+ % 
+
+ All directors and officers as a group (3 persons) 
+
+ 
+ 
+
+ 14,133,140 
+
+ 
+ 
+
+ 14.6% 
+
+ 
+
+ 3 
+
+ 
+ 
+
+ 100 
+
+ % 
+
+ 
+ 
+
+ 40 
+
+ % 
+
+*Less than one percent
+
+ 
+
+(1)
+
+ Based on 93,741,002 shares of our Common Stock issued and outstanding as of February 12, 2014. 
+
+ 
+
+(2)
+
+ Former Chief Executive Officer and Chairman of the Company. Resigned from both positions on March 22, 2013. 
+
+ 
+
+(3)
+
+President and Director of the Company.
+
+ 
+
+(4)
+
+Chief Financial Officer and Director of the Company.
+
+ 
+
+(5)
+
+Secretary and Director of the Company.
+
+ 
+
+(6)
+
+ Based on 3 shares of our Series B Preferred Stock outstanding as of February 12, 2014. 
+
+ 
+
+(7)
+
+ Holders of our Common Stock are entitled to one vote per share. Holders of our Series B preferred stock are entitled to the number of votes on such matters equal to (i) the product of (a) the number of shares of Series B Preferred Stock held by such holder, (b) the number of issued and outstanding shares of the Corporation s Common Stock (taking into account the effective outstanding voting rights of the Series B Preferred Stock), as of the record date for the vote and (c) 0.13334 less (ii) the number of shares of Common Stock beneficially held by such holder on such date. Accordingly the Series B Preferred shares are entitled to a total of 36,045,733 votes as of January 30, 2014. 
+
+ 
+
+SELLING STOCKHOLDERS
+
+Up to 158,652,485 shares of Common Stock are being offered by this prospectus, all of which are being registered for sale for the account of the selling stockholders and include the following:
+
+ 
+
+ 
+
+63,993,768 shares of Common Stock issued to the investors in the Private Placement in January and April of 2013;
+
+ 
+
+ 
+
+55,217,258 shares of Common Stock issuable upon the exercise of outstanding warrants issued to the investors in the private placement in January and April 2013.
+
+ 
+
+ 
+
+39,441,459 shares of Common Stock issuable upon the conversion of outstanding shares of Series A Convertible Preferred Stock issued to the investors in the private placement in January and April 2013.
+
+Each of the transactions by which the selling stockholders acquired their securities from us was exempt under the registration provisions of the Securities Act.
+
+The 158,652,485 shares of Common Stock referred to above are being registered to permit public sales of the shares, and the selling stockholders may offer the shares for resale from time to time pursuant to this prospectus. The selling stockholders may also sell, transfer or otherwise dispose of all or a portion of their shares in transactions exempt from the registration requirements of the Securities Act or pursuant to another effective registration statement covering those shares. We may from time to time include additional selling stockholders in supplements or amendments to this prospectus.
+
+ 
+
+-27-
+
+Table of Contents
+
+The table below sets forth certain information regarding the selling stockholders and the shares of our Common Stock offered by them in this prospectus. The selling stockholders have not had a material relationship with us within the past three years other than as described in the footnotes to the table below or as a result of acquisition of our shares or other securities. To the best of our knowledge, none of the selling stockholders is a broker dealer or an affiliate of a broker dealer other than as described in the footnotes to the table below.
+
+ Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission. The selling stockholders percentage of ownership of our outstanding shares in the table below is based upon 93,741,002 shares of Common Stock outstanding as of February 12, 2014. 
+
+ 
+
+-28-
+
+Table of Contents
+
+ 
+
+ 
+ 
+
+Ownership Before Offering
+
+ 
+
+Ownership After Offering (1)
+
+Selling Stockholder
+
+ 
+
+Number of shares of Common Stock beneficially owned
+
+ 
+
+Number of shares offered
+
+ 
+
+Number of shares of Common Stock beneficially owned
+
+ 
+
+Percentage of Common Stock beneficially owned
+
+Stuart H. Smith
+
+ 
+ 
+
+11,333,334
+
+(3)
+
+11,333,334
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Sandor Capital Master Fund (2)
+
+ 
+ 
+
+40,036,764
+
+(4)
+
+40,036,764
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Gerri Entler
+
+ 
+ 
+
+1,677,840
+
+(5)
+
+1,677,840
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Terence McMahon
+
+ 
+ 
+
+671,164
+
+(6)
+
+671,164
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+John Wachter
+
+ 
+ 
+
+6,715,408
+
+(7)
+
+6,715,408
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+StarCity Capital LLC(8)
+
+ 
+ 
+
+6,666,666
+
+(9)
+
+6,666,666
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+The John St. Thomas and Barbara St. Thomas Revocable 2005 Trust Dated 9/9/2005 (10)
+
+ 
+ 
+
+2,000,000
+
+(11)
+
+2,000,000
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+HS Contrarian Investments LLC(12)
+
+ 
+ 
+
+3,333,336
+
+(13)
+
+3,333,336
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Sichenzia Ross Friedman Ference LLP(14)
+
+ 
+ 
+
+4,166,668
+
+(15)
+
+4,166,668
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Melechdavid, Inc. (16)
+
+ 
+ 
+
+3,333,334
+
+(17)
+
+3,333,334
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Jonathan Honig
+
+ 
+ 
+
+3,333,336
+
+(18)
+
+3,333,336
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Alpha Capital Anstalt (19)
+
+ 
+ 
+
+16,666,666
+
+(20)
+
+16,666,666
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Brio Capital Master Fund Ltd. (21)
+
+ 
+ 
+
+8,500,000
+
+(22)
+
+8,500,000
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Erick Richardson
+
+ 
+ 
+
+2,000,000
+
+(23)
+
+2,000,000
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Marc Wexler (24)
+
+ 
+ 
+
+2,500,000
+
+ 
+
+2,500,000
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Saverio Pugliese (25)
+
+ 
+ 
+
+6,839,555
+
+ 
+
+6,839,555
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+William Haramis (26)
+
+ 
+ 
+
+4,843,823
+
+ 
+
+4,843,823
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Steve Feinman
+
+ 
+ 
+
+231,436
+
+ 
+
+231,436
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Douglas Steinberg
+
+ 
+ 
+
+231,436
+
+ 
+
+231,436
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+William Kunkel
+
+ 
+ 
+
+231,436
+
+ 
+
+231,436
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+David Wolfson (27)
+
+ 
+ 
+
+454,028
+
+ 
+
+454,028
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Joseph Rienzi (28)
+
+ 
+ 
+
+6,839,556
+
+ 
+
+6,839,556
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+John Toth
+
+ 
+ 
+
+2,746,701
+
+ 
+
+2,746,701
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+John Bostock
+
+ 
+ 
+
+833,333
+
+ 
+
+833,333
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Robert S. Colman
+
+ 
+ 
+
+1,666,667
+
+ 
+
+1,666,667
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+William C. Stevens
+
+ 
+ 
+
+833,333
+
+ 
+
+833,333
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Michael J. Wright
+
+ 
+ 
+
+3,333,333
+
+ 
+
+3,333,333
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+JF Partners (29)
+
+ 
+ 
+
+5,000,000
+
+ 
+
+5,000,000
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+R. Stephen Doyle
+
+ 
+ 
+
+1,666,667
+
+ 
+
+1,666,667
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+James A. McCarthy
+
+ 
+ 
+
+833,333
+
+ 
+
+833,333
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Mark Rossi
+
+ 
+ 
+
+833,333
+
+ 
+
+833,333
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Bashkim Celaj
+
+ 
+ 
+
+533,333
+
+ 
+
+533,333
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Isuf Celaj
+
+ 
+ 
+
+533,333
+
+ 
+
+533,333
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Haxhe Celaj
+
+ 
+ 
+
+533,333
+
+ 
+
+533,333
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Besnik Celaj
+
+ 
+ 
+
+533,333
+
+ 
+
+533,333
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Frank Cormio
+
+ 
+ 
+
+1,666,667
+
+ 
+
+1,666,667
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+Maria Scarano
+
+ 
+ 
+
+1,666,667
+
+ 
+
+1,666,667
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+KDW Investors (30)
+
+ 
+ 
+
+2,833,333
+
+ 
+
+2,8333,333
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+TOTAL:
+
+ 
+ 
+
+158,652,485
+
+(31)
+
+158,652,485
+
+ 
+ 
+
+0
+
+ 
+
+0.00%
+
+ 
+
+(1)
+
+ 
+
+Represents the amount of shares that will be held by the selling stockholders after completion of this offering based on the assumptions that (a) all shares registered for sale by the registration statement of which this prospectus is part will be sold and (b) that no other shares of our Common Stock beneficially owned by the selling stockholders are acquired or are sold prior to completion of this offering by the selling stockholders.
+
+(2)
+
+ 
+
+John S. Lemak, as Manager of Sandor Capital Master Fund, has voting and dispositive power over shares held by Sandor Capital Master Fund.
+
+(3)
+
+ 
+
+Includes 739,130 shares of Common Stock, 4,927,537 shares of Common Stock issuable upon conversion of Series A Convertible Preferred Stock, and 5,666,667 shares of Common Stock issuable upon the exercise of outstanding warrants.
+
+(4)
+
+ 
+
+Includes 2,421,128 shares of Common Stock, 17,597,254 shares of Common Stock issuable upon conversion of Series A Convertible Preferred Stock, and 20,018,382 shares of Common Stock issuable upon the exercise of outstanding warrants.
+
+(5)
+
+ 
+
+Includes 838,920 shares of Common Stock and 838,920 shares of Common Stock issuable upon the exercise of outstanding warrants.
+
+(6)
+
+ 
+
+Includes 335,582 shares of Common Stock and 335,582 shares of Common Stock issuable upon the exercise of outstanding warrants.
+
+(7)
+
+ 
+
+Includes 3,357,704 shares of Common Stock and 3,357,704 shares of Common Stock issuable upon the exercise of outstanding warrants.
+
+(8)
+
+ 
+
+Yoseph Levin, as Manager of StarCity Capital LLC, has voting and dispositive power over shares held by StarCity Capital, LLC.
+
+(9)
+
+ 
+
+Includes 3,333,333 shares of Common Stock and 3,333,333 shares of Common Stock issuable upon the exercise of outstanding warrants.
+
+(10)
+
+ 
+
+John St. Thomas and Barbara St. Thomas, as Trustees of the The John St. Thomas and Barbara St. Thomas Revocable 2005 Trust Dated 9/9/2005, share voting and dispositive power over shares held by John St. Thomas and Barbara St. Thomas TTEES.
+
+(11)
+
+ 
+
+Includes 1,000,000 shares of Common Stock and 1,000,000 shares of Common Stock issuable upon the exercise of outstanding warrants.
+
+(12)
+
+ 
+
+John Stetson, as Manager of HS Contrarian Investments, LLC, has voting and dispositive power over shares held by HS Contrarian Investments, LLC.
+
+(13)
+
+ 
+
+Includes 1,666,668 shares of Common Stock and 1,666,668 shares of Common Stock issuable upon the exercise of outstanding warrants.
+
+(14)
+
+ 
+
+ Gregory Sichenzia, Marc J. Ross, Richard A. Friedman, Michael Ference, Thomas A. Rose, Jeffrey Fessler, Harvey Kesner, Benjamin Tan, Andrea Cataneo and Darrin M. Ocasio have shared voting and dispositive power over the shares of Common Stock held by Sichenzia Ross Friedman Ference LLP. Sichenzia Ross Friedman Ference LLP is legal counsel to the Company and received all of such shares being sold in this offering as compensation for legal services provided. 
+
+(15)
+
+ 
+
+Includes 2,083,334 shares of Common Stock and 2,083,334 shares of Common Stock issuable upon the exercise of outstanding warrants.
+
+(16)
+
+ 
+
+Mark Groussman, as President of Melechdavid, Inc., has voting and dispositive power over shares held by Melechdavid, Inc..
+
+(17)
+
+ 
+
+Includes 1,666,667 shares of Common Stock issuable upon conversion of Series A Convertible Preferred Stock, and 1,666,667 shares of Common Stock issuable upon the exercise of outstanding warrants.
+
+(18)
+
+ 
+
+Includes 1,666,668 shares of Common Stock issuable upon conversion of Series A Convertible Preferred Stock, and 1,666,668 shares of Common Stock issuable upon the exercise of outstanding warrants.
+
+(19)
+
+ 
+
+Konrad Ackerman, as Director of Alpha Capital Anstalt, has voting and dispositive power over shares held by Alpha Capital Anstalt.
+
+(20)
+
+ 
+
+Includes 8,333,333 shares of Common Stock issuable upon conversion of Series A Convertible Preferred Stock and 8,333,333 shares of Common Stock issuable upon the exercise of outstanding warrants.
+
+(21)
+
+ 
+
+Shaye Hirsch, as Director of Brio Capital Master Fund Ltd., has voting and dispositive power over shares held byBrio Capital Master Fund Ltd.
+
+(22)
+
+ 
+
+Includes 4,250,000 shares of Common Stock issuable upon conversion of Series A Convertible Preferred Stock and 4,250,000 shares of Common Stock issuable upon the exercise of outstanding warrants.
+
+(23)
+
+ 
+
+Includes 1,000,000 shares of Common Stock issuable upon conversion of Series A Convertible Preferred Stock and 1,000,000 shares of Common Stock issuable upon the exercise of outstanding warrants.
+
+(24)
+
+ 
+
+Marc Wexler is our former Chief Executive Officer. Mr. Wexler resigned from his positions as of March 22, 2013.
+
+(25)
+
+ 
+
+Saverio Pugliese is our current President and serves on our Board of Directors.
+
+(26)
+
+ 
+
+William Haramis is the former Secretary of Be Active. Mr. Haramis resigned his positions as of May 11, 2011.
+
+(27)
+
+ 
+
+David Wolfson is our current Chief Financial Officer and serves on our Board of Directors.
+
+(28)
+
+ 
+
+Joseph Rienzi is our current Secretary and serves on our Board of Directors.
+
+(29)
+
+ 
+
+Jeff Johson, as a managing member of JF Partners, has voting and dispositive power over shares held by JF Partners.
+
+(30)
+
+ 
+
+Vincent DeFiore, as a managing member of KDW Investors, has voting and dispositive power over shares held by KDW Investors.
+
+(31)
+
+ 
+
+Includes 63,993,768 shares of Common Stock, 39,441,459 shares of Common Stock issuable upon conversion of Series A Convertible Preferred Stock, and 55,217,258 shares of Common Stock issuable upon the exercise of outstanding warrants.
+
+ 
+
+-29-
+
+Table of Contents
+
+ 
+
+DESCRIPTION OF SECURITIES
+
+Authorized Capital Stock
+
+We have authorized 550,000,000 shares of capital stock, of which 400,000,000 are shares of Common Stock, par value $0.0001 per share, and 150,000,000 are shares of preferred stock, par value $0.0001.
+
+Capital Stock Issued and Outstanding
+
+We have issued and outstanding securities on a fully diluted basis:
+
+ 
+
+ 
+
+ 93,741,002 shares of Common Stock; 
+
+ 
+
+ 
+
+ 
+
+Warrants to purchase 55,217,258 shares of Common Stock;
+
+ 
+
+ 
+
+ 
+
+39,441,459 shares of Series A Convertible Preferred Stock which are convertible into 39,441,459 shares of
+
+Common Stock; and
+
+ 
+
+ 
+
+ 
+
+ 3 shares of Series B Convertible Preferred Stock which, using number of shares issued and outstanding as of February 12, 2014, will be convertible into approximately 36,045,733 shares of Common Stock on April 26, 2014, subject to adjustment. 
+
+Common Stock
+
+The holders of our Common Stock are entitled to one vote per share. In addition, the holders of our Common Stock will be entitled to receive ratably such dividends, if any, as may be declared by our Board of Directors out of legally available funds; however, the current policy of our Board of Directors is to retain earnings, if any, for operations and growth. Upon liquidation, dissolution or winding-up, the holders of our Common Stock will be entitled to share ratably in all assets that are legally available for distribution. The holders of our Common Stock will have no preemptive, subscription, redemption or conversion rights. The rights, preferences and privileges of holders of our Common Stock will be subject to, and may be adversely affected by, the rights of the holders of any series of preferred stock, which may be designated solely by action of our board of directors and issued in the future.
+
+Preferred Stock
+
+Our Board of Directors is authorized, subject to any limitations prescribed by law, without further vote or action by our stockholders, to issue from time to time shares of preferred stock in one or more series. Each series of preferred stock will have such number of shares, designations, preferences, voting powers, qualifications and special or relative rights or privileges as shall be determined by our Board of Directors, which may include, among others, dividend rights, voting rights, liquidation preferences, conversion rights and preemptive rights.
+
+Series A Convertible Preferred Stock
+
+We have designated forty million (40,000,000) shares of preferred stock, par value $0.0001 per share as Series A Convertible Preferred Stock. Each share of Series a Convertible Preferred Stock is entitled to one vote per share. Each share of Series A Convertible Preferred Stock is convertible, at the shareholders election, into one share of the Company s Common Stock (subject to limitations on the holder s ability to convert in the event such conversion causes the holder to beneficially own in excess of 4.99% of the our issued and outstanding Common Stock, subject to a discretionary waiver in such limitation by the holder upon 61 days notice.).
+
+ 
+
+-30-
+
+Table of Contents
+
+ 
+
+Series B Convertible Preferred Stock
+
+ We have designated four (4) shares of preferred stock, par value $0.0001 per share as Series B Convertible Preferred Stock. Each share of Series B Convertible Preferred Stock is entitled to such number of votes on all matters submitted to shareholders that is equal to (i) the product of (a) the number of shares of Series B Convertible Preferred Stock held by such holder, (b) the number of issued and outstanding shares of the Corporation s Common Stock (taking into account the effective outstanding voting rights of the Series B Convertible Preferred Stock), as of the record date for the vote and (c) 0.13334 less (ii) the number of shares of Common Stock beneficially held by such holder on such date. Additionally, on the twelve month anniversary date of the date of issuance of the Series B Convertible Preferred Stock, each outstanding share of Series B Convertible Preferred Stock shall automatically, and without further action on the part of the holder, convert into such number of fully paid and non-assessable shares of Common Stock as shall cause the holder to own, along with any other securities of the Company beneficially owned on the conversation date by them, 13.334% of the issued and outstanding Common Stock of the Corporation, calculated on the conversion date. 
+
+Options and Warrants
+
+Options under the Plan
+
+We adopted our 2013 Equity Incentive Plan pursuant to which 8,550,000 shares of the Common Stock are reserved for issuance to employees, directors, consultants, and other service providers. To date, no awards have been granted under the 2013 Equity Incentive Plan.
+
+Warrants
+
+In connection with the January Private Placement, we issued three year warrants to purchase an aggregate of 3,902,993 shares of our Common Stock at an exercise price of $0.30 per share, subject to certain adjustments. The Warrants contain limitations on exercise, including the limitation that the holders may not convert their warrants to the extent that upon exercise the holder, together with its affiliates, would own in excess of 4.99% of our outstanding shares of Common Stock (subject to an increase upon at least 61-days notice by the subscriber to us, of up to 9.99%). For as long as the Warrant remains outstanding, the Warrant contains standard anti-dilution protection in the event we issue Common Stock at a lower per share price. In connection with the April Private Placement, the exercise price of the warrants was reduced to $0.03 per share.
+
+In connection with the April Private Placement, we issued five year warrants to purchase an aggregate of 28,333,334 shares of our Common Stock at an exercise price of $0.05 per share, subject to certain adjustments. The Warrants contain limitations on exercise, including the limitation that the holders may not convert their warrants to the extent that upon exercise the holder, together with its affiliates, would own in excess of 4.99% of our outstanding shares of Common Stock (subject to an increase upon at least 61-days notice by the subscriber to us, of up to 9.99%). For as long as the Warrant remains outstanding, the Warrant contains standard anti-dilution protection in the event the Company s issues Common Stock at a lower per share price.
+
+In connection with the sale of the units, we were required to issue to investors in the Company s January Private Placement, additional shares of Common Stock (or, at the election of such investor who would, as a result of such issuance, become the holder of in excess of 5% of the Company s issued and outstanding Common Stock, shares of Series A Convertible Preferred Stock), in connection with certain anti-dilution protection provided to such prior investors under the terms of the January Private Placement. As a result of the foregoing, we issued an aggregate of an additional (a) 3,789,473 shares of Common Stock (b) 19,191,458 shares of Series A Convertible Preferred Stock and (c) warrants to purchase an additional 22,980,931 shares of Common Stock at an exercise price of $0.03 per share. Furthermore, the exercise price of the warrants issued in the January Private Placement was reduced to a per share exercise price of $0.03.
+
+ 
+
+-31-
+
+Table of Contents
+
+ 
+
+Indemnification of Directors and Officers
+
+Section 145 of the Delaware General Corporation Law provides that a corporation may indemnify directors and officers as well as other employees and individuals against expenses including attorneys' fees, judgments, fines and amounts paid in settlement in connection with various actions, suits or proceedings, whether civil, criminal, administrative or investigative other than an action by or in the right of the corporation, a derivative action, if they acted in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, if they had no reasonable cause to believe their conduct was unlawful. A similar standard is applicable in the case of derivative actions, except that indemnification only extends to expenses including attorneys' fees incurred in connection with the defense or settlement of such actions, and the statute requires court approval before there can be any indemnification where the person seeking indemnification has been found liable to the corporation. The statute provides that it is not exclusive of other indemnification that may be granted by a corporation's certificate of incorporation, bylaws, agreement, a vote of stockholders or disinterested directors or otherwise.
+
+The Company s Certificate of Incorporation and By-Laws provide that it will indemnify and hold harmless, to the fullest extent permitted by Section 145 of the Delaware General Corporation Law, as amended from time to time, each person that such section grants us the power to indemnify.
+
+The Delaware General Corporation Law permits a corporation to provide in its certificate of incorporation that a director of the corporation shall not be personally liable to the corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability for:
+
+ 
+
+any breach of the director's duty of loyalty to the corporation or its stockholders;
+
+ 
+
+acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law;
+
+ 
+
+payments of unlawful dividends or unlawful stock repurchases or redemptions; or
+
+ 
+
+any transaction from which the director derived an improper personal benefit.
+
+The Company s Certificate of Incorporation and By-Laws provide that, to the fullest extent permitted by applicable law, none of our directors will be personally liable to us or our stockholders for monetary damages for breach of fiduciary duty as a director. Any repeal or modification of this provision will be prospective only and will not adversely affect any limitation, right or protection of a director of our company existing at the time of such repeal or modification.
+
+Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
+
+None.
+
+ 
+
+-32-
+
+Table of Contents
+
+ 
+
+PLAN OF DISTRIBUTION
+
+The selling stockholders, which, as used herein, includes donees, pledgees, transferees or other successors-in-interest selling shares of Common Stock received after the date of this prospectus from a selling stockholder as a gift, pledge, partnership distribution or other transfer, may, from time to time, sell, transfer or otherwise dispose of any or all of their shares of Common Stock on any stock exchange, market or trading facility on which the shares are traded or in private transactions. These dispositions may be at fixed prices, at prevailing market prices at the time of sale, at prices related to the prevailing market price, at varying prices determined at the time of sale, or at negotiated prices. We have not been advised of any arrangements by the selling stockholders for the sale of any of the Common Stock owned by them.
+
+The selling stockholders may use any one or more of the following methods when disposing of shares or interests therein:
+
+ 
+
+ 
+
+ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;
+
+ 
+
+ 
+
+ 
+
+block trades in which the broker-dealer will attempt to sell the shares as agent, but may position and resell a portion of the block as principal to facilitate the transaction;
+
+ 
+
+ 
+
+ 
+
+crosses, where the same broker acts as an agent on both sides of the trade;
+
+ 
+
+ 
+
+ 
+
+purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
+
+ 
+
+ 
+
+ 
+
+an exchange distribution in accordance with the rules of the applicable exchange;
+
+ 
+
+ 
+
+ 
+
+privately negotiated transactions;
+
+ 
+
+ 
+
+ 
+
+short sales;
+
+ 
+
+ 
+
+ 
+
+through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;
+
+ 
+
+ 
+
+ 
+
+broker-dealers may agree with the selling stockholders to sell a specified number of such shares at a stipulated price per share;
+
+ 
+
+ 
+
+ 
+
+a combination of any such methods of sale; and
+
+ 
+
+ 
+
+ 
+
+any other method permitted pursuant to applicable law.
+
+ 
+
+ 
+
+-33-
+
+Table of Contents
+
+ 
+
+The selling stockholders may, from time to time, pledge or grant a security interest in some or all of the shares of Common Stock owned by them and, if they default in the performance of their secured obligations, the pledgees or secured parties may offer and sell the shares of Common Stock, from time to time, under this prospectus, or under an amendment to this prospectus under Rule 424(b)(3) or other applicable provision of the Securities Act amending the list of selling stockholders to include the pledgee, transferee or other successors in interest as selling stockholders under this prospectus. The selling stockholders also may transfer the shares of Common Stock in other circumstances, in which case the transferees, pledgees or other successors in interest will be the selling beneficial owners for purposes of this prospectus; provided, however, that prior to any such transfer the following information (or such other information as may be required by the federal securities laws from time to time) with respect to each such selling beneficial owner must be added to the prospectus by way of a prospectus supplement or post-effective amendment, as appropriate: (1) the name of the selling beneficial owner; (2) any material relationship the selling beneficial owner has had within the past three years with us or any of our predecessors or affiliates; (3) the amount of securities of the class owned by such security beneficial owner before the transfer; (4) the amount to be offered for the security beneficial owner s account; and (5) the amount and (if one percent or more) the percentage of the class to be owned by such security beneficial owner after the transfer is complete.
+
+Any selling stockholder and any other person participating in a distribution will be subject to applicable provisions of the Exchange Act and the rules and regulations under that statute, including, without limitation, possibly Regulation M. This may limit the timing of purchases and sales of any of the securities by a selling stockholder and any other participating person. Regulation M may also restrict the ability of any person engaged in the distribution of the securities to engage in market-making activities with respect to the securities. All of the foregoing may affect the marketability of the securities and the ability of any person or entity to engage in market-making activities with respect to the securities.
+
+We are required to pay all fees and expenses incident to the registration of the shares, including fees and disbursements of counsel to the selling stockholder, but excluding brokerage commissions or underwriter discounts.
+
+The selling stockholders, alternatively, may sell all or any part of the shares offered in this prospectus through an underwriter. No selling stockholder has entered into any agreement with a prospective underwriter and there is no assurance that any such agreement will be entered into.
+
+A selling stockholder may pledge its shares to their brokers under the margin provisions of customer agreements. If a selling stockholder defaults on a margin loan, the broker may, from time to time, offer and sell the pledged shares.
+
+If the selling stockholder notifies us that it has a material arrangement with a broker-dealer for the resale of the Common Stock, then we would be required to amend the registration statement of which this prospectus is a part, and file a prospectus supplement to describe the agreements between the selling stockholder and the broker-dealer.
+
+LEGAL MATTERS
+
+Sichenzia Ross Friedman Ference LLP, New York, New York, will pass upon the validity of the shares of Common Stock offered by the selling stockholders under this prospectus. Sichenzia Ross Friedman Ference LLP is the beneficial holder of 4,166,668 shares, which includes 2,083,334 shares of Common Stock and 2,083,334 shares of Common Stock issuable upon the exercise of outstanding warrants, which are being registered pursuant to this prospectus.
+
+EXPERTS
+
+The consolidated financial statements of Be Active Holdings, Inc. as at December 31, 2012 and for the year then ended have been audited by Cornick, Garber & Sandler, LLP and the financial statements of Be Active Holdings, Inc. as at December 31, 2011 and for the year then ended have been audited by Friedman LLP, independent registered public accounting firms as set forth in their respective reports, and are included in reliance upon such reports given on the authority of such firms as experts in accounting and auditing.
+
+ 
+
+-34-
+
+Table of Contents
+
+WHERE YOU CAN FIND ADDITIONAL INFORMATION
+
+We have filed with the Securities and Exchange Commission a registration statement on
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001552719_embarr_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001552719_embarr_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..1c3315635c456bf3fa6632888d1cd4bf72ad99b7
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001552719_embarr_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following summary highlights material information contained in this prospectus. This summary does not contain all of the information you should consider before investing in the securities. Before making an investment decision, you should read the entire prospectus carefully, including the risk factors section, the financial statements and the notes to the financial statements. You should also review the other available information referred to in the section entitled Where you can find more information in this prospectus and any amendment or supplement hereto. Unless otherwise indicated, the terms the Company, Embarr Downs we, us, and our refer and relate to Embarr Downs, Inc.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001555527_c-wolters_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001555527_c-wolters_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..213b39b57c157a310d2ac61d638d958b7568a1d5
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001555527_c-wolters_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following prospectus summary should read in conjunction with, the more detailed information and our Financial Statements and Notes thereto appearing elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should read the entire prospectus carefully. The company is a shell company. Accordingly, the securities sold in this offering can only be resold through registration under the Securities Act of 1933, Section 4(1), if available, for non-affiliates, or by meeting the conditions of Rule 144(i).
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001574815_bmc-stock_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001574815_bmc-stock_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..d6bec146a51d22e2816589767266869473b654e8
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001574815_bmc-stock_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. It does not contain all of the information that may be important to you and your investment decision. You should carefully read the following summary together with the entire prospectus. In this prospectus, unless the context otherwise requires, references to the Company, we, us and our refer to Stock Building Supply Holdings, Inc., together with its consolidated subsidiaries. Overview We are a large, diversified lumber and building materials ( LBM ) distributor and solutions provider that sells to new construction and repair and remodeling contractors. We carry a broad line of products and have operations throughout the United States. Our primary products are lumber & lumber sheet goods, millwork, doors, flooring, windows, structural components such as engineered wood products ( EWP ), trusses and wall panels and other exterior products. Additionally, we provide solution-based services to our customers, including design, product specification and installation management services. We serve a broad customer base, including large-scale production homebuilders, custom homebuilders and repair and remodeling contractors. We offer approximately 39,000 stock keeping units ( SKUs ), as well as a broad range of customized products, all sourced through our strategic network of suppliers, which together with our various solution-based services, represent approximately 50% of the construction cost of a typical new home. By enabling our customers to source a significant portion of their materials and services from one supplier, we have positioned ourselves as the supply partner of choice for many of our customers. We have operations in 14 states that accounted for approximately 56% of 2013 U.S. single-family housing permits according to the U.S. Census Bureau. Our primary operating regions include the South and West regions of the United States (as defined by the U.S. Census Bureau), with a significant portion of our net sales derived from markets within Texas, North Carolina, Utah, California and Georgia. We serve our customers from 69 locations, which include 48 distribution and retail operations, 20 millwork fabrication operations, 14 structural components fabrication operations and 15 flooring operations. Given the local nature of our business, we locate our facilities in close proximity to our key customers and often co-locate multiple operations in one facility to increase customer service and efficiency. The following map shows our current operating footprint. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion. Dated March 10, 2014. 6,600,000 Shares Stock Building Supply Holdings, Inc. Common Stock The selling stockholders are offering 6,600,000 shares of our common stock. We will not receive any proceeds from the sale of shares by the selling stockholders. Our shares are listed on The NASDAQ Stock Market under the symbol STCK. On March 7, 2014, the last sale of our common stock as reported on NASDAQ was $20.96 per share. See Risk Factors on page 14 to read about factors you should consider before buying shares of the common stock. Neither the Securities and Exchange Commission nor any other state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. Per Share Total Public offering price $ $ Underwriting discount(1) $ $ Proceeds, before expenses, to the selling stockholders $ $ (1) See Underwriting. The selling stockholders identified in this prospectus have granted the underwriters an option to purchase, on the same terms and conditions as set forth above, up to an additional 990,000 shares within 30 days from the date of this prospectus. We will not receive any of the proceeds from the sale of shares by these selling stockholders if the underwriters exercise their option to purchase additional shares. The underwriters expect to deliver the shares against payment in New York, New York on , 2014. Goldman, Sachs & Co. Barclays Citigroup Baird Stephens Inc. Wells Fargo Securities Prospectus dated , 2014. Table of Contents We provide a balanced mix of products and services to U.S. production and custom homebuilders and repair and remodeling, multi-family and commercial contractors. The charts below summarize our 2013 revenues by product category and customer segment. 2013 revenues by product category 2013 revenues by customer segment Table of Contents Table of Contents The following table demonstrates the favorable demographic trends in the metropolitan areas in which we operate and the capabilities of our facilities. Market 2013 single family permits Year over year single family permit change December 2013 unemployment rate 2013 total employment year over year change Distribution & retail operations Millwork fabrication Structural components fabrication Flooring operations Houston, TX 34,509 20.5 % 5.5 % 3.0 % 4 2 2 Atlanta, GA 14,803 61.5 % 6.8 % 2.5 % 3 2 2 Washington, DC 13,277 20.9 % 4.6 % 0.8 % 3 2 4 (7) Raleigh-Durham, NC(1) 10,007 24.8 % 5.1 % 2.4 % 4 1 1 3 (8) Austin, TX 9,240 12.3 % 4.5 % 2.8 % 1 1 1 Charlotte, NC 8,792 31.2 % 6.6 % 2.6 % 1 2 1 Los Angeles, CA 7,477 51.2 % 7.9 % 1.5 % 11 2 1 Eastern PA(2) 6,857 15.1 % 6.3 % 0.5 % 1 1 1 Salt Lake City, UT(3) 5,966 18.1 % 4.3 % 2.1 % 5 3 2 San Antonio, TX 5,841 14.5 % 5.3 % 0.7 % 1 Richmond, VA 3,577 26.0 % 5.2 % 1.5 % 1 1 1 Columbia, SC 3,176 13.8 % 5.5 % 1.7 % 2 1 2 (9) Greenville, SC 2,576 14.7 % 5.0 % 1.5 % 1 1 Fort Myers, FL 2,531 40.1 % 5.8 % 1.9 % 1 Greensboro, NC(4) 2,319 15.1 % 6.6 % 1.3 % 1 1 Northwest AR(5) 2,062 17.0 % 4.9 % 4.1 % 1 1 1 Southern Utah(6) 1,797 36.4 % 4.3 % 3.6 % 1 1 Albuquerque, NM 1,443 14.6 % 6.5 % 0.9 % 1 1 1 Spokane, WA 1,001 3.9 % 7.3 % 1.0 % 2 1 Lubbock, TX 938 24.7 % 4.3 % 2.9 % 2 1 Amarillo, TX 549 (15.9 %) 4.0 % 1.5 % 2 Total for Stock Building Supply markets 138,738 24.8 % 6.2 % 1.7 % 48 20 14 15 U.S. Total 617,501 19.0 % 6.5 % 1.7 % Source: U.S. Census Bureau and Bureau of Labor Statistics (1) Durham-Chapel Hill, NC and Raleigh-Cary, NC metropolitan statistical areas ( MSAs ) (2) Philadelphia-Camden-Wilmington, PA-NJ-DE-MD and Lancaster, PA MSAs (3) Salt Lake City, UT and Provo-Orem, UT MSAs (4) Greensboro-High Point, NC and Winston-Salem, NC MSAs (5) Fayetteville-Springdale-Rogers, AR-MO MSA (6) St. George, UT MSA (7) Includes flooring location in Baltimore, MD (8) Includes flooring location in Fayetteville, NC (9) Includes flooring location in Charleston, SC Since 2010, we have acquired four businesses and, through investments in a proprietary information technology ( IT ) and operational platform, have improved our distribution service capability. We have also integrated each of our local branches with our headquarters in Raleigh, North Carolina. Additionally, we have undertaken efforts to streamline and improve significantly our business processes by adopting a LEAN business philosophy to reduce waste and add value. These initiatives allowed us to minimize the increase in our selling, general and administrative expense, which rose only 3.5% from 2010 to 2013, while net sales increased 59.3% during the same time period. We believe that, as we continue to pursue these initiatives, we will further improve the service and support we provide to our customers, increase the effectiveness of our employees and contractors and improve efficiency across all aspects of our business. Table of Contents TABLE OF CONTENTS PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2014/CIK0001577095_clubcorp_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001577095_clubcorp_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..97577bdce0c7bacabf6eb288619f4198ca275c75
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2014/CIK0001577095_clubcorp_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained in greater detail elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our common stock, you should carefully read this entire prospectus, including our consolidated financial statements and the related notes that are incorporated by reference in this prospectus and the information set forth under the headings "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations". Unless otherwise indicated in this prospectus, "ClubCorp", "our company", "we", "us" and "our" refer to ClubCorp Holdings, Inc. and its subsidiaries. Overview We are a membership-based leisure business and a leading owner-operator of private golf and country clubs, business, sports and alumni clubs in North America. As of March 25, 2014, our portfolio of 157 owned or operated clubs, with over 148,000 memberships, serves over 370,000 individual members. We are the largest owner of private golf and country clubs in the United States and own the underlying real estate for 83 of our 107 golf and country clubs (consisting of over 18 thousand acres of fee simple real estate). We lease, manage or operate through joint ventures the remaining 24 golf and country clubs. We own, lease, manage or operate through a joint venture 50 business, sports and alumni clubs. Our golf and country clubs are designed to appeal to the entire family, fostering member loyalty which we believe allows us to capture a greater share of our member households' discretionary leisure spending. Our business, sports and alumni clubs are designed to provide our members with private upscale locations where they can work, network and socialize. We offer our members privileges throughout our collection of clubs, and we believe that our diverse facilities, recreational offerings and social programming enhance our ability to attract and retain members across a number of demographic groups. We also have alliances with other clubs, resorts and facilities located worldwide through which our members can enjoy additional access, discounts, special offerings and privileges outside of our owned and operated clubs. Given the breadth of our products, services and amenities, we believe that we offer a compelling value proposition to our members. ClubCorp was founded in 1957 with one country club in Dallas, Texas with the basic premise of providing a first-class club membership experience. We later expanded to encompass multiple locations, making us one of the first companies to enter into the business of professional ownership and operation of private golf and country clubs. In 1966, we established our first business club with the belief that we could profitably apply our principle of delivering quality service and member satisfaction in a related line of business. In 1999, we began leveraging the breadth and geographic diversity of our clubs by offering our members various upgrade programs to take advantage of our portfolio of clubs and variety of amenities. Through a combination of consumer research and experimentation, capital investment and relevant programming, we have sought to "reinvent" the modern club experience to promote greater usage of our facilities. We believe that higher usage results in additional ancillary spend and improved member retention. From 2007 through 2013, we retained an average annualized membership base of 83.7% in golf and country clubs and 75.6% in business, sports and alumni clubs, for a blended retention rate of 79.9%, for such period. From 2007 through 2013, we "reinvented" 19 golf and country clubs and 16 business, sports and alumni clubs through capital investment. In 2014, we plan to invest approximately $20 million of reinvention capital across 11 clubs and will continue to evaluate opportunities to apply our reinvention strategy in the future. We have created new membership programming, such as our Optimal Network Experience ("O.N.E.") offering that provides members access to benefits and special offerings in their local community, network-wide and beyond, in addition to benefits at their home club. In addition, from Amendment No. 1 To FORM S-1 REGISTRATION STATEMENT Under THE SECURITIES ACT OF 1933 Table of Contents fiscal year 2007 through 2013, we have spent over $55 million to acquire 10 golf and country clubs and to develop a new alumni club, further expanding our portfolio of clubs and broadening the reach of our network. Our operations are organized into two principal business segments: (1) golf and country clubs and (2) business, sports and alumni clubs. Our golf and country club segment includes a broad variety of clubs designed to appeal to a diverse group of families and individuals who lead an active lifestyle and seek a nearby outlet for golf, tennis, swimming and other outdoor activities. Our business clubs are generally located in office towers or business complexes and cater to business executives, professionals and entrepreneurs with a desire to entertain clients, expand their business networks, work and socialize in a private, upscale location. Our sports clubs include a variety of fitness and racquet facilities. Our alumni clubs are associated with universities with large alumni networks, and are designed to provide a connection between the university and its alumni and faculty. For fiscal years 2007 through 2013, we have invested approximately $410 million of capital to better position and maintain our clubs in their respective markets. This represents an investment of 7.9% of our total revenues, for such period, in our clubs to reinvent, upgrade, maintain, replace and build new and existing facilities and amenities focused on enhancing our members' experience. For the fiscal year ended December 31, 2013, golf and country clubs accounted for 78% of our total club revenue and business, sports and alumni clubs accounted for 22% of our total club revenue. Our Competitive Strengths Membership-Based Leisure Business with Significant Recurring Revenue. We operate with the central purpose of building relationships and enriching the lives of our members. We focus on creating a dynamic and exciting setting for our members by providing them with an environment in which to engage in a variety of leisure, recreational and networking activities. We believe our clubs have become an integral part of many of our members' lives and, as a result, the vast majority of our members retain their memberships each year, even during the recession that primarily impacted us during 2008-2010 (the "recession"). Our large base of memberships creates a stable recurring revenue stream. As of March 25, 2014, our owned and operated clubs had over 148,000 memberships, including over 370,000 individual members. For the fiscal year ended December 31, 2013, membership dues totaled $373.4 million, representing 46.0% of our total revenues and our membership retention was 83.7% in golf and country clubs and 77.2% in business, sports and alumni clubs for a blended retention rate of 80.8%. ClubCorp Holdings, Inc. (Exact name of registrant as specified in its charter) Nevada (State or other jurisdiction of incorporation or organization) 7997 (Primary Standard Industrial Classification Code Number) 20-5818205 (I.R.S. Employer Identification Number) 3030 LBJ Freeway, Suite 600 Dallas, Texas 75234 (972) 243-6191 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Table of Contents The following charts present our membership counts and annualized retention rates for our two business segments for the past 10 years: The proven strength and resiliency of our membership base from peak to trough is an attractive attribute of our business. We believe that if our members remain satisfied with their club experience, they will remain loyal and frequent users of our clubs, reducing our sensitivity to adverse economic conditions and providing us with operating leverage in favorable economic conditions and a recovering real estate market. Although we experienced a decline of 0.7% in average memberships on a compound basis from 2009 to 2013, total revenue per average membership increased in each of those years. Revenue per average membership has steadily increased over the past four years growing 5.7% on a compounded basis and totaling $4,732, $5,014, $5,237 and $5,591 for fiscal years ended 2010, 2011, 2012, and 2013, respectively. For all years presented, we calculate average membership using the membership count at the beginning and end of the relevant year. Further, according to our fiscal year 2013 data, the average number of visits per membership at one of our clubs is 31 times per year with an average spend of $4,100 per year, including dues. The average number of visits per golf membership at one of our clubs is 55 times per year with an average spend of $7,300 per year, including dues. We believe that the demographics of our member base are also an important attribute of our business. According to data provided by Buxton, a database and mapping service, based on the addresses of our members, an analysis for our golf and country club members indicates that they have on average an annual household income of $180,000 to $200,000 and a primary home value of $500,000 to $600,000. An analysis from the same database for our business, sports and alumni club members indicates that they have on average an annual household income of $150,000 to $180,000 and a primary home value of $435,000 to $545,000. We believe that these demographic profiles were more resilient during the recession, and we believe they will spend more in an improving economy and recovering real estate market than the general population, although there is no guarantee they will do so. Eric L. Affeldt President and Chief Executive Officer ClubCorp Holdings, Inc. 3030 LBJ Freeway, Suite 600 Dallas, Texas 75234 (972) 243-6191 (Name, address, including zip code, and telephone number, including area code, of agent for service) Table of Contents Nationally-Recognized and Award-Winning Clubs. Our golf and country clubs, with approximately 138 18-hole course equivalents as of March 25, 2014, represent the core assets of our company and are strategically concentrated in sunbelt markets and other major metropolitan areas. We believe that our clubs are among the top private golf clubs within their respective markets based on the quality of our facilities, breadth of amenities and number of relevant programs and events. These clubs are anchored by our golf courses, of which approximately one third are designed by some of the world's best-known golf course architects, including Jack Nicklaus, Tom Fazio, Pete Dye, Arthur Hills and Robert Trent Jones. The operations and maintenance of our golf courses and facilities have led to our selection as host of several high-profile events, leading to local and national media recognition as well as event revenue, club utilization and membership sales. Outside of our golf offering, our clubs provide a variety of additional amenities and services that we believe appeal to the whole family, such as well-appointed clubhouses, a variety of dining venues, event and meeting spaces, tennis facilities, exercise studios, personal training, spa services, resort-style pools and water features and outdoor gathering spaces. We offer over 650 tennis courts across more than 65 clubs, and our Brookhaven Country Club features a nationally-recognized private tennis facility. Many of our 50 business, sports and alumni clubs are located in the heart of the nation's influential business districts, with locations in 17 of the top 25 metropolitan statistical areas, and offer an urban location for professionals to network with colleagues, conduct business and socialize with friends. We believe our business clubs are choice locations for regional and local business and civic receptions with business amenities to support these events. These clubs also host numerous upscale private events, such as weddings, bar and bat mitzvahs and holiday parties. These events generate traffic flow through our clubs, helping to drive membership sales and club utilization. In addition, the six alumni clubs we operate offer a unique setting for alumni and faculty to share common heritage and experiences. Expansive Portfolio of Clubs and Alliances Providing Scale. As the largest owner-operator of private golf and country clubs in the United States, we believe that our expansive portfolio of clubs allows us to drive membership growth by providing a compelling value proposition through product variety. By clustering our clubs, many of our members have local access to both urban business-focused clubs as well as suburban family-oriented clubs. For an incremental monthly charge, our reciprocal access program gives our members access to our owned and operated clubs, as well as the facilities of others with which we have an alliance relationship, both domestically and internationally. As of March 25, 2014, approximately 44% of our memberships were enrolled in one or more of our upgrade programs, as compared to approximately 43% and 40% of memberships as of December 31, 2013 and December 25, 2012, respectively. Incremental dues relating to our upgrade programs accounted for approximately $32.0 million of our annual dues for the fiscal year ended December 31, 2013. By providing members with numerous services and amenities that extend beyond their home clubs to all of the clubs we own and operate and the clubs with which we have alliances, we believe we can drive membership growth and create a key market differentiator which would be difficult for our competitors to replicate. We believe the size of our portfolio of clubs provides us with significant economies of scale, creating operational synergies across our clubs and enabling us to consolidate our human resources, sales and marketing, accounting and technology departments. We also benefit from centralized purchasing to receive preferred pricing on supplies, equipment and insurance. Diversification. As a result of our size and geographic diversity, our operating revenues and cash flows are not reliant on any one club or geographic region. Our 10 largest clubs by revenue Copies to: William B. Brentani Simpson Thacher & Bartlett LLP 2475 Hanover Street Palo Alto, California 94304 Tel: (650) 251-5000 Fax: (650) 251-5002 Patrick S. Brown Sullivan & Cromwell LLP 1888 Century Park East, 21st Floor Los Angeles, California 90067 Tel: (310) 712-6600 Fax: (310) 712-8800 Table of Contents accounted for approximately 23% of our club revenues for the fiscal year ended December 31, 2013, and no one of these clubs accounted for greater than 3.2% of club revenue for such period. We have strategic concentrations of golf and country clubs in Texas, California and Florida, representing 31%, 20% and 6%, respectively, of total club revenue for the fiscal year ended December 31, 2013. While we have greater presence in these states where climates are typically conducive to year-round play, we believe that the broad geographic distribution of our portfolio of clubs helps mitigate the impact of adverse regional weather patterns and fluctuations in regional economic conditions. To allow for maximization of golf rounds, we employ a corporate director of agronomy and regional golf superintendents who oversee our strong agronomic practices, helping to extend golf play throughout the climate zones in which we operate. Ownership and Control of Golf and Country Clubs. As the fee simple real estate owner for 83 of our 107 golf and country clubs, we believe that we have an advantage over other clubs as we have the ability to maximize the value of our clubs and business. By owning the real estate underlying our clubs, we have been able to implement capital plans that inure to our benefit and generate positive returns on our investments. Owning many of our assets also gives us the flexibility to recycle our capital by selling underperforming clubs or non-essential tracts of land. Seasoned Management Team. We have a highly experienced professional management team. Our six current executive officers had a combined 155 years of related career experience, including on average 20 years of hospitality and club-specific experience through the end of fiscal year 2013. Eric Affeldt has acted as President and Chief Executive Officer for ClubCorp since December 2006 and has over 23 years of experience leading golf and resort companies, including as president and chief executive officer of KSL Fairways Golf Corporation, as well as general manager for Doral Golf Resort & Spa in Miami and PGA West and La Quinta Resort & Club in California. Curt McClellan, our Chief Financial Officer and Treasurer, has been with our company since November 2008 and is responsible for leading the corporate finance and accounting teams. Our Chief Operating Officer, Mark Burnett has over 25 years of experience managing golf and country clubs and leading golf and resort companies, including serving as chief operating officer for American Golf Corporation and president and chief executive officer and chief operating officer of KSL Fairways Golf Corporation. We have also attracted and retained qualified general managers for our clubs. Our club general managers average over 10 years of service with us. These managers are tasked with the day-to-day responsibility of running the clubs and executing the strategic direction of senior management. Our Business Strategy Attracting and retaining members while increasing member usage by providing the highest quality club experience are the biggest drivers of our revenue growth. In order to drive revenue growth, we use the following strategies: Employ Experienced Membership Sales Force. We employ club-based, professional sales personnel who are further supported by an array of regional and corporate sales and marketing teams. Our sales team receives comprehensive sales training through our internally developed "Bell Notes" training program that we believe addresses all elements of the sales process from prospecting to welcoming a new member to their club. Our sales efforts are supported by regional and national programs and upgrade offerings that typically are not found at private clubs, such as the access to our extensive portfolio of clubs and benefits. As a result, our sales team members are able to readily differentiate our clubs from competitive facilities. Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definition of "large accelerated filer", "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company Table of Contents We periodically obtain feedback from our membership base to effectively understand current membership demographics and preferences to better target member prospects. We believe our well-trained and incentivized sales team will continue to drive membership growth, and we believe we are well-positioned to capitalize on improving economic conditions. Leverage Our Portfolio and Alliance Offerings. We offer a variety of products, services and amenities through upgrade offerings that provide members access to our portfolio of clubs and leverage our alliances with other clubs, resorts and facilities both domestically and internationally. In 2010, we strategically introduced our O.N.E. program and have continued to market it aggressively across most of our golf and country clubs. O.N.E. is an offering that combines what we refer to as "comprehensive club, community and world benefits". With this offering, members receive 50% off a la carte dining at their home club; preferential offerings to clubs in their community (including those owned by us), as well as at local spas, restaurants and other venues; and complimentary privileges to more than 200 golf and country, business, sporting and athletic clubs when traveling outside of their community with additional offerings and discounts to more than 700 renowned hotels, resorts, restaurants and entertainment venues. These programs are designed to increase our recurring monthly revenues while providing a value proposition to our members that helps drive increased usage of our facilities. As of December 31, 2013, almost 80 of our clubs offer the O.N.E. program to their members. During 2013, over 50% of our new members joined our upgrade programs at clubs where they are offered as compared to 35% of new members who purchased upgraded product offerings prior to the introduction of the O.N.E. program. In 2013, use of our facilities by members outside of their home club increased by 34% as a result of the utilization of the O.N.E. program benefits. Food and beverage revenues increased 22% from 2010 to 2013, which we largely attribute to our enhanced dining venues and offerings, including O.N.E., the recovering economy and greater consumer spend. We continue to evaluate opportunities for further expansion of the O.N.E. offering into additional geographic areas. We have established alliances with other leisure-oriented businesses, whereby members of our clubs have usage privileges or receive special pricing at such businesses. We target alliances with recognized brands that appeal to our members. We market and promote our member benefits through our in-house marketing tools, including member e-newsletters and e-communications, our internally developed online Benefits Finder, other social media applications and our quarterly-distributed proprietary Private Clubs magazine. We make reservations convenient for members by providing an in-house concierge (ClubLine), and by offering access to an inventory of VIP tickets through our own web portal (TicketLine). We continually seek additional reciprocal arrangements and alliances with other hospitality-oriented businesses that can further enhance our members' variety of choices extending beyond their home club. Develop New and Relevant Programming. Members who frequently utilize our facilities typically tend to spend more at our clubs and remain members longer. As a result, we believe that there are significant opportunities to increase operating revenues by making our clubs more relevant to our members. Our goal is to provide numerous opportunities for all members and their families to utilize our facilities. Members also participate in clubs within their club, whereby members with similar interests come together for recreational, educational, charitable, social and business-oriented purposes. We believe this reinforces the club becoming integral to the lives of our members. Our individual clubs also benefit from member participation on their board of governors and numerous committees providing us valuable feedback and recommendations for further improvements to our program offerings. We will continue to promote activities and events occurring at members' home clubs, and believe we can further tailor our programming to address members' particular preferences and interests. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. Table of Contents Take Advantage of Improving Economic Conditions. We believe improving economic conditions and improvements in local housing markets reinforce the foundation for membership growth. Although some of the metropolitan areas where we operate clubs were disproportionately affected by the recession, related to the decline in home prices and increase in foreclosure rates, our membership base remained resilient, which we believe can be attributed to our favorable membership demographics. Economic indicators, such as increased consumer confidence, discretionary spending and home sales and construction, support an environment where we believe prospective members will choose to join our clubs. Reinvent Through Strategic Capital Investment. We believe our ability to conceptualize, fund and execute club reinventions gives us a significant competitive advantage over member-owned and individual privately-owned clubs, which may have difficulty gaining member consensus and financial backing to execute such improvements. In 2007, we embarked on the "reinvention" of our clubs through strategic capital investment projects designed to drive membership sales, facility usage and member retention. We believe this strategy results in increased member visits during various parts of the day for both business and pleasure, allowing our clubs to serve multiple purposes depending on the individual needs of our members. Elements of reinvention capital expenditures include "Touchdown Rooms", which are small private meeting rooms allowing members to hold impromptu private meetings while leveraging the other services of their club. "Anytime Lounges" provide a contemporary and casual atmosphere to work and network, while "Media Rooms" provide state of the art facilities to enjoy various forms of entertainment. Additional reinvention elements include refitted fitness centers, enhanced pool area amenities such as shade cabanas, pool slides and splash pads, redesigned golf practice areas for use by beginners to avid golfers, and newly created or updated indoor and outdoor dining and social gathering areas designed to take advantage of the expansive views and natural beauty of our clubs. As of March 25, 2014, 35 of our clubs were considered "major reinvention" clubs and received significant reinvention capital. We define "major reinvention" clubs as those clubs receiving $750,000 or more gross capital spend on a project basis, excluding initial one-time capital investments at newly acquired clubs. During fiscal 2012 and 2013, we spent $17.6 million and $26.0 million, respectively, on reinvention capital and plan to invest approximately $20 million in 2014 at seven golf and country clubs and four business, sport and alumni clubs. We believe these additional major reinvention projects represent opportunities to increase revenues and generate a positive return on our investment, although we cannot guarantee such returns. We will continue to identify and prioritize capital projects for fiscal years 2015 and beyond to add reinvention elements. Pursuing Selected Acquisitions. Acquisitions allow us to expand our portfolio and network offerings. We believe the ability to offer access to our collection of clubs provides us a significant competitive advantage in pursuing acquisitions. Newly acquired clubs may generally benefit from additional capital and implementation of our reinvention strategy. We believe that the unique benefits we have to offer, such as a policy which does not assess members for capital improvements as well as our ability to consummate acquisitions and improve operations, provide us a unique competitive advantage in pursuing potential transactions. We believe there are many attractive acquisition opportunities available and we continually evaluate and selectively pursue these opportunities to expand our business. We actively communicate with other club operators, their lenders and boards of directors who may seek to dispose of their club properties or combine membership rosters at a single club location. We also evaluate joint ventures and management opportunities that allow us to expand our operations and increase our recurring revenue base without substantial capital outlay. When we do make strategic acquisitions, we do so only after an evaluation to satisfy ourselves that we can add value given our external growth experience, facility assessment capabilities, operational expertise and economies of scale. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion. Dated June 9, 2014. 7,000,000 Shares ClubCorp Holdings, Inc. Common Stock Table of Contents From 2011 through March 25, 2014, we have continued to take advantage of market conditions to expand our portfolio through the acquisition of ten golf and country clubs and the entry into new agreements to manage and operate two additional golf and country clubs. In addition to our domestic initiatives, we believe there is an attractive market to extend our private club expertise through international management arrangements. As of March 25, 2014, we manage one business club in Beijing, China and one business club in Hefei, China and have an agreement to manage one business club currently under development elsewhere in China. Industry Overview Our company is a membership-based leisure business closely tied to consumer discretionary spending. We believe that we compete for these discretionary consumer dollars against such businesses as amusement parks, spectator sports, ski and mountain resorts, fitness and recreational sports centers, gaming and casinos, hotels and restaurants. We believe that we will benefit from the recovery taking place in the leisure industry as evidenced by recent trends in GDP growth within our industry. According to the Bureau of Economic Analysis ("BEA"), from 2012 to 2013, leisure and hospitality industry's GDP growth increased by 2.0%, outperforming overall U.S. GDP growth of 1.9% during the same period. Summary of Risk Factors Our business is subject to numerous risks, which are described in the section entitled "Risk Factors". You should carefully consider these risks before making an investment. In particular, the following considerations, among others, may offset our competitive strengths or have a negative effect on our business strategy, which could cause a decline in the price of our common stock and result in a loss of all or a portion of your investment: adverse conditions affecting the United States economy; our ability to attract and retain club members; changes in consumer spending patterns, particularly with respect to demand for products and services; unusual weather patterns, extreme weather events and periodic and quasi-periodic weather patterns, such as the El Ni o/La Ni a-Southern Oscillation; material cash outlays required in connection with refunds or escheatment of membership initiation deposits; impairments to the suitability of our club locations; and the other factors set forth in the section entitled "Risk Factors". Corporate Information ClubCorp Holdings, Inc. was incorporated in the State of Nevada on November 10, 2010. Our principal executive offices are located at 3030 LBJ Freeway, Suite 600, Dallas, Texas 75234. Our telephone number is (972) 243-6191. Our website address is www.clubcorp.com. In addition, we maintain a Facebook page at www.facebook.com/clubcorp and a Twitter feed at www.twitter.com/clubcorp. Information contained on, or that can be accessed through, our website, Facebook page or Twitter feed does not constitute part of this prospectus and inclusions of our website address, Facebook page address and Twitter feed address in this prospectus are inactive textual references only. The information that can be accessed through our website is not part of this prospectus, and investors should not rely on any such information in deciding whether to purchase our common stock. The selling stockholder identified in this prospectus is an affiliate of KSL Capital Partners, LLC ("KSL") and is offering 7,000,000 shares of common stock of ClubCorp Holdings, Inc. The selling stockholder will receive all of the net proceeds from this offering and we will not receive any of the proceeds from the sale of the shares of common stock being sold by the selling stockholder. Our common stock is listed on the New York Stock Exchange (the "NYSE") under the symbol "MYCC". The last reported sales price of our common stock on June 6, 2014 was $18.35 per share. See "Risk Factors" beginning on page 16 to read about factors you should consider before buying shares of our common stock. Table of Contents Our Sponsor After completion of this offering, affiliates of KSL Capital Partners, LLC ("KSL") will continue to control a majority of the voting power of our outstanding capital stock. KSL is a leading U.S. private equity firm dedicated to investing in travel and leisure businesses with offices in Denver, New York and London. Since its founding in 2005, KSL has raised over $3.4 billion of committed capital. For a discussion of certain risks, potential conflicts and other matters associated with KSL's affiliates' control, see "Risk Factors Risks Relating to this Offering and Ownership of Our Common Stock Affiliates of KSL will continue to be able to significantly influence our decisions after the completion of this offering and their interests may conflict with ours or yours in the future" and "Description of Capital Stock". Emerging Growth Company Status We are an "emerging growth company", as defined in the Jumpstart Our Business Startups Act enacted on April 5, 2012, which we refer to as the JOBS Act. For as long as we are an "emerging growth company", we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies", including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding advisory "say-on-pay" and "say-when-on-pay" votes on executive compensation and shareholder advisory votes on golden parachute compensation. Under the JOBS Act, we will remain an "emerging growth company" until December 25, 2018 or the earliest of: the last day of the fiscal year during which we have total annual gross revenues of $1 billion or more; the date on which we have, during the previous three-year period, issued more than $1 billion in non-convertible debt; or the date on which we are deemed to be a "large accelerated filer" under the Securities Exchange Act of 1934, or the Exchange Act (we will qualify as a large accelerated filer as of the first day of the first fiscal year after we have (i) more than $700 million in outstanding common equity held by our non-affiliates and (ii) been public for at least 12 months; the value of our outstanding common equity will be measured each year on the last day of our second fiscal quarter). The JOBS Act also provides that an "emerging growth company" can utilize the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, or the Securities Act, for complying with new or revised accounting standards. However, we have elected to "opt out" of such extended transition period, and, as a result, we comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for companies that are not "emerging growth companies". Section 107 of the JOBS Act provides that our decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable. Trade Names Our logos, "Associate Club"; "Associate Clubs"; "Building Relationships and Enriching Lives"; "ClubCater"; "ClubCorp"; "ClubCorp Charity Classic"; "ClubCorp Resorts"; "Club Corporation of America"; "ClubLine"; "Club Resorts"; "Club Without Walls"; "Fastee Course"; "Membercard"; "My Club. My Community. My World."; "Private Clubs"; "The Society"; "The World Leader in Private Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. Table of Contents Clubs"; and "Warm Welcomes, Magic Moments and Fond Farewells" and other trade names, trademarks or service marks of our company appearing in this prospectus are the property of our company. This prospectus contains additional trade names, trademarks and service marks of other companies. We do not intend our use or display of other companies' trade names, trademarks or service marks to imply relationships with, or endorsement or sponsorship of us by, these other companies. Per Share Total Initial price to public $ $ Underwriting discount and commissions(1) $ $ Proceeds, before expenses, to the selling stockholder $ $ Table of Contents
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+S-1/A 1 a2220686zs-1a.htm S-1/A Use these links to rapidly review the document TABLE OF CONTENTS Table of Contents As filed with the Securities and Exchange Commission on July 8, 2014 Registration No. 333-197027 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Neither we nor the selling stockholders have authorized anyone to provide any information or to make any representations other than those contained or incorporated by reference into this prospectus or in any free writing prospectuses we have prepared. We and the selling stockholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained or incorporated by reference in this prospectus is accurate only as of the date such information is presented. AMENDMENT NO. 1 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS AND INFORMATION This prospectus and the information incorporated by reference into this prospectus contain statements about future events and expectations that constitute forward-looking statements. Forward-looking statements may include, but are not limited to, statements relating to our projected second quarter 2014 Adjusted EBITDA and net income ranges described under "Prospectus Summary Recent Developments" elsewhere in this prospectus. Forward-looking statements are based on our beliefs, assumptions and expectations of our future financial and operating performance and growth plans, taking into account the information currently available to us. These statements are not statements of historical fact. Forward-looking statements involve risks and uncertainties that may cause our actual results to differ materially from the expectations of future results we express or imply in any forward-looking statements and you should not place undue reliance on such statements. Factors that could contribute to these differences include, but are not limited to, the following: Decreases in our revenue and profit margin under our fee-for-service contracts due to changes in volume, payor mix and third party reimbursement rates, including from political discord in the federal budgeting process; The loss of existing contracts; Failure to accurately assess costs under new contracts; Difficulties in our ability to recruit and retain qualified physicians and other healthcare professionals, and enforce our non-compete agreements with our physicians; Failure to implement some or all of our business strategies, including our efforts to grow our Evolution Health, LLC ("Evolution Health") business and cross-sell our services; Lawsuits for which we are not fully reserved; The adequacy of our insurance coverage and insurance reserves; Our ability to successfully integrate strategic acquisitions; The high level of competition in the markets we serve; The cost of capital expenditures to maintain and upgrade our vehicle fleet and medical equipment; The loss of one or more members of our senior management team; Our ability to maintain or implement complex information systems; Disruptions in disaster recovery systems or management continuity planning; Our ability to adequately protect our intellectual property and other proprietary rights or to defend against intellectual property infringement claims; Challenges by tax authorities on our treatment of certain physicians as independent contractors; The impact of labor union representation; The impact of fluctuations in results due to our national contract with the Federal Emergency Management Agency ("FEMA"); Potential penalties or changes to our operations, including our ability to collect accounts receivable, if we fail to comply with extensive and complex government regulation of our industry; Table of Contents management, patient flow coordination, evidence-based clinical protocols, community-based clinical and medical transportation services, patient monitoring and clinician recruitment. For the year ended December 31, 2013, we generated net revenue of $3.7 billion, of which EmCare represented 63% and AMR represented 37%, and Adjusted EBITDA of $445.7 million, of which EmCare represented 66% and AMR represented 34%. Approximately 89% of our net revenue for the year ended December 31, 2013 was generated under exclusive contracts. As of December 31, 2013, EmCare had contracts covering 706 clinical departments, and AMR had 169 "911" contracts and 3,677 non-emergency transport arrangements. During 2013, we had a total of 14.9 million weighted patient encounters and weighted transports across approximately 2,100 communities nationwide. In calculating weighted patient encounters at EmCare across our four main categories of patient encounters emergency department ("ED") visits, hospitalist encounters, radiology reads and anesthesiology cases each radiology read and anesthesiology case is not counted as a full patient encounter as we apply a discount factor to reflect differences in reimbursement rates for and associated costs of providing such services. In calculating "weighted transports" at AMR for our two main transport categories ambulance transports and wheelchair transports we likewise apply a discount factor to wheelchair transports. See " Summary Consolidated Financial Data" for a discussion of Adjusted EBITDA and a reconciliation to net income. Industry Trends We believe that we are well-positioned to benefit from trends currently affecting the healthcare services markets in which we compete, including: Continued Healthcare Services Outsourcing. Due to the growing complexity of the healthcare delivery system, healthcare facilities and communities are increasingly turning to leading outsourced medical services providers that offer comprehensive solutions. Healthcare facilities continue to outsource as a result of increasing cost pressures, difficulty in recruiting physicians and the need to improve operational efficiency. Communities increasingly outsource medical transportation services due to cost pressures, service issues and the challenge of meeting peak emergency demands in a cost-effective manner while delivering optimal clinical outcomes. We believe that large, national providers of outsourced medical services will continue to benefit from these outsourcing trends and gain market share by demonstrating the ability to improve productivity, lower costs and enhance quality of care. Focus on Cost Containment. As rising healthcare costs have further strained federal, state and local budgets, healthcare facilities, communities and payors have come under significant pressure to reduce costs and improve the quality of care. Opportunities to reduce healthcare costs include improving patient flow coordination, decreasing the length of hospital stays, reducing readmission rates, identifying more cost-efficient clinical settings and providing more efficient community-based and facility-based medical transportation services. In addition, there is increasing focus on the subset of patients that account for a disproportionate share of national healthcare costs. We believe that efficient management of care across the patient continuum, particularly for patients with complex and chronic conditions, represents a significant opportunity to reduce overall healthcare costs and improve quality and outcomes. Shift Towards Coordinated Care and Measured Clinical Outcomes. In the current healthcare environment, we believe the hospital-centric delivery system requires improved care coordination and communication among healthcare providers. We believe that improved collaboration and access to information across the patient continuum will facilitate the ability of healthcare providers to analyze patient data and identify more effective treatment protocols that ultimately improve outcomes and reduce costs. As the number of patients with complex and chronic conditions Table of Contents The impact of changes in the healthcare industry, including changes due to healthcare reform; Our ability to timely enroll our providers in the Medicare program; Our ability to restructure our operations to comply with future changes in government regulation; The outcome of government investigations of certain of our business practices; Our ability to comply with the terms of our settlement agreements with the government; Our ability to generate cash flow to service our substantial debt obligations; The significant influence of investment funds sponsored by, or affiliated with, Clayton, Dubilier & Rice, LLC (the "CD&R Affiliates") over us; and
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+PROSPECTUS SUMMARY This summary highlights significant aspects of our business and this offering. You should carefully read this entire prospectus, including the information presented under the section entitled "Risk Factors" and the historical financial data and related notes, before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from the results discussed in the forward-looking statements as a result of certain factors, including those set forth in "Risk Factors" and "Cautionary Note Regarding Forward-Looking Statements." Unless we state otherwise or the context otherwise requires, references in this prospectus to "Transport America," "we," "our," and "us" refer to Transport America, Inc., a Minnesota corporation, and its consolidated subsidiaries, including Transport Corporation of America, Inc. a Minnesota corporation, which we refer to in this prospectus as our operating company. We are the sole shareholder of the operating company. Unless we state otherwise or the context otherwise requires, references in this prospectus to "drivers" refer collectively to our employee drivers and our independent contractor drivers. Summary Our Business We are a leading provider of truckload transportation and logistics services to shippers located in the United States and Mexico. We offer a broad, integrated suite of truckload transportation services to a diverse and sophisticated group of customers who value our high-quality services for their multiple shipping needs. We primarily provide for-hire, dry-van truckload transportation, delivered by solo or team drivers, combined with regional, dedicated, intermodal and brokerage services. We operate a modern technology-enabled fleet of approximately 1,470 tractors (comprising approximately 1,330 company tractors and approximately 140 tractors provided by independent contractors) and 4,450 trailers and an efficient network of 12 terminals. Our management team has demonstrated the ability to increase operating income, improve margins and integrate large acquisitions, while maintaining a reputation for service, safety and reliability. While we believe we will be able to leverage these capabilities in the future, it is not guaranteed. We have created standardized processes and a scalable infrastructure, which we believe can support significantly larger operations and additional acquisitions with minimal incremental investment. We believe the benefits of access to capital provided by this offering position us to accelerate our growth through a combination of internal expansion and strategic acquisitions, although it is not guaranteed. Our current business has been created by three transformative events. In early 2006, we were acquired by GHJ&M, the private investment firm that controls our largest shareholder. GHJ&M's objective was to profitably grow the business by installing an experienced and professional management team to improve operations and continue to provide excellent service. Beginning in 2006, we rebuilt our senior management team with seasoned professionals, promoting Keith Klein to COO in early 2006 and hiring Scott Arves as CEO later that year. In January 2011, we acquired Southern Cal in one of the largest asset-based truckload acquisitions made in our industry based on announced acquisition price during the last six years, increasing our geographic reach and expanding our service offerings. As illustrated below, since 2006, we have focused on profitable growth, cost discipline and capital preservation, improving our annual operating ratio from 98.4% in 2005 to 93.5% in 2013 as well as improving our annual adjusted operating ratio from 97.6% in 2005 to 91.3% in 2013 and increasing our annual operating income from $19.2 million in 2012 to $22.7 million in 2013 and our adjusted annual operating income from $19.2 million in 2012 to $23.4 million in 2013. For the year ended December 31, 2013, our net income was $7.0 million on revenues of $347.5 million compared to a net income of $3.9 million on revenues of $363.5 million for the year ended December 31, 2012 and a net loss of $11.6 million on revenues of $388.1 million for the year ended 2011. AMENDMENT NO. 1 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents "Dedicated" means those contracts in which we have agreed to dedicate certain tractor and trailer capacity for use by a specific customer. Dedicated contracts often have predictable routes and revenues and frequently replace all or part of a shipper's private fleet. "DOT" means The U.S. Department of Transportation. "DOT-reportable accident" means an occurrence involving a commercial motor vehicle operating on a highway in interstate or intrastate commerce which results in: (i) a fatality; (ii) bodily injury to a person who, as a result of the injury, immediately receives medical treatment away from the scene of the accident; or (iii) one or more motor vehicles incurring disabling damage as a result of the accident, requiring the motor vehicle(s) to be transported away from the scene by a tow truck or other motor vehicle. A DOT-reportable accident does not include: (i) an occurrence involving only boarding and alighting from a stationary motor vehicle; or (ii) an occurrence involving only the loading or unloading of cargo. "Drayage" means the transport of shipping containers from a dock or port to an intermediate or final destination or the transportation of containers or trailers between pick-up or delivery locations and a railhead. "Dry van" means an enclosed, non-refrigerated trailer generally used to carry goods. "E-logs" means electronic driver logs, which replace paper log books. Paper log books are labor-intensive and cumbersome. E-logs also give managers greater visibility into safety and driver efficiency, allowing problems to be identified and addressed. "FMCSA" means Federal Motor Carrier Safety Administration. "For-hire truckload carrier" means a truckload carrier available to shippers for hire. "Fuel surcharge" means a fee that is added to the freight charges that allows the carrier to be reimbursed for fuel costs incurred in the performance of hauling freight. "GHJ&M" means Goldner Hawn Johnson & Morrison, a Minneapolis-based private investment firm that controls our largest shareholder, Transport Investors. "Intermodal" or "rail intermodal" means the transport of shipping containers or trailers on railroad flat cars before or after a movement by tractor from the point of origin to the railhead or from the railhead to the destination. "Lane" means a route, often an interstate or major highway, on which a great amount of freight flows back and forth. "Less-than-truckload carrier" or "LTL carrier" means a carrier that picks up and delivers multiple shipments, each typically weighing less than 10,000 pounds, for multiple customers in a single trailer. "Linehaul" means the movement of freight on a designated route between cities and service centers. "Loaded mile" means a mile that is driven for a customer for which we are compensated. "MAP21" means the Moving Ahead for Progress in the 21st Century Act, the current federal highway legislation. "NASDAQ" means The Nasdaq Global Select Market. "Private fleet" means the tractors and trailers owned or leased by a shipper to transport its own goods. *Operating income for 2011 was a loss of $0.1 million. Operating Ratio and Adjusted Operating Ratio (2005-2013) Our Competitive Strengths We believe that the following principles enable us to compete effectively: Recruit, train and retain exceptional talent and management We believe that the depth of our highly talented, energetic and committed employee pool is one of our key competitive strengths. The addition of Scott Arves as our CEO was a key element of an extensive rebuilding of our talent base with a seasoned, professional and results-oriented management team. Prior to joining us in 2006, Mr. Arves spent 27 years with Schneider National, one of the nation's largest for-hire truckload carriers, where he was responsible for managing a $3 billion truckload and intermodal business that employed approximately 20,000 people. In addition, Mr. Klein's promotion to COO established a strong financial-oriented operations leader who, together with Mr. Arves, has been instrumental in our success. Our executives have extensive transportation and logistics experience with TRANSPORT AMERICA, INC. (Exact name of registrant as specified in its charter) Table of Contents "Regional" means short- and medium-haul trucking operations, operating in a defined geographical area. "Revenue equipment" means our company tractors and trailers. "Revenues per loaded mile" means total revenues received per mile traveled for which we are compensated for carrying a load. "Seated tractor" means a tractor available for service and for which we have a driver to drive it. "Shipper" means the provider of goods which the carrier delivers. Shippers are our customers. "Southern Cal" means Southern Cal Transport, Inc., a business we acquired on January 12, 2011. "Solo" means trucking operations carried out by a single driver. "Team" means alternating between two drivers in accordance with hours-of-service regulations. Teams are able to move cargo faster over long distances because they can drive more hours in a day than a solo driver. "Tractor" means a truck designed primarily to pull a trailer by means of a fifth wheel mounted over the rear axle(s) of the truck. "Trailer" refers to a large transport conveyance designed to be pulled by a tractor. "Transport Investors" means Transport Investors, LLC, the owner of approximately 79% of our common stock outstanding on the date of this prospectus. "Transport Topics" means a national weekly business publication owned by the ATA covering trucking and freight transportation news. "Truckload carrier" means a carrier that generally dedicates an entire trailer or container to one customer from origin to destination. Table of Contents leading companies such as UPS, JB Hunt, Best Buy, Home Depot, Echo Global Logistics and Yellow Roadway. Our eight-person senior management team possesses a combined 175-plus years of transportation and logistics experience. This leadership team has improved our operational execution, revenue growth and customer service. As a result of the talent and vision of our leadership team, we have clarified our strategy, attracted talent to execute this strategy, standardized our processes, streamlined our operations and established a culture of discipline and accountability. Pursue continuous improvements in operations and execution Our management team has built an organization focused on continuous improvement in our operations and execution. We have worked aggressively to build a company culture with a strategy, vision and purpose that provides a roadmap for our employees to succeed in their positions. In particular, we believe our process-driven operations result in consistent execution and lower operating costs through increased efficiency, higher on-time delivery rates and fewer errors. We created this process-driven operating strategy based on five key components, which we refer to as our "cornerstones": Provide an excellent customer experience; Focus on sales and customer service to create demand for our services that frequently exceeds our capacity, enabling us to pursue the most attractive freight and optimally load our equipment; Improve the profitability of freight through effective yield management; Continually improve processes that enable us to deliver exceptional results; and Continue to drive to a low cost, high-value position in the industry. As a result of executing this operating strategy over the last six years, we have cultivated a strong culture that serves as the foundation of and driving force behind sustainable operating enhancements. Since the beginning of 2006, our annual operating ratio has improved by 490 basis points and our annual adjusted operating ratio improved by approximately 630 basis points. The consistent execution of these cornerstones enables us to achieve industry-leading customer service, safety and driver retention. Capitalize on potential acquisition opportunities The transportation and logistics industry is large and highly fragmented, thereby providing significant opportunities to pursue strategic acquisitions. Our scalable platform and infrastructure, experienced management team and ability to identify, execute and integrate acquisitions provide us with a competitive strength when seeking potential acquisition candidates. We believe that we currently have the infrastructure in place to pursue our growth goals, which include geographic expansion and the introduction of new or enhanced service offerings (particularly regional and dedicated truckload services, brokerage activities and intermodal services). Furthermore, our strengthened capital position following this offering provides additional acquisition capabilities. Our management team is deeply experienced at identifying, integrating and improving the performance of acquired businesses. Our CEO, Scott Arves, has worked on the integration of five trucking acquisitions of various sizes during his career. Other members of our senior management team are equally experienced with acquisitions, bringing expertise gained through a total of 25 additional transactions. The success of our team was demonstrated by our recent acquisition and integration of Southern Cal, one of the largest asset-based truckload acquisitions completed in our industry based on announced acquisition price during the last six years. Following our acquisition of Southern Cal in 2011, we improved its adjusted operating ratio by approximately 1,100 basis points in the next six fiscal quarters (before it was integrated into our existing operations in the fall of 2012) through the application of our five operating cornerstones. We believe our experience with this acquisition, our ability to apply our operating cornerstones to acquired Minnesota (State or other jurisdiction of incorporation or organization) 4213 (Primary Standard Industrial Classification Code Number) 20-4094878 (I.R.S. Employer Identification No.) 1715 Yankee Doodle Road Eagan, Minnesota 55121 (651) 686-2500 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Table of Contents businesses and our cultural emphasis on execution position us to successfully acquire and integrate targets. Deliver a broad suite of services with high-quality customer service We offer a broad integrated suite of dry-van truckload services to address customers' various transportation needs, including solo, team, regional, dedicated, intermodal and brokerage services. This diversified offering enables us to compete effectively as customers continue to seek transportation providers that offer a broader range of services, allowing them to streamline their transportation management. Our customer base consists principally of Fortune 1000 medium-volume shippers that we believe are often underserved and that have a wide variety of shipping needs, value our ability to provide comprehensive truckload solutions and require high-quality execution. Our breadth of services helps diversify our customer base, creates cross-selling opportunities and strengthens relationships by deepening our integration with our customers' supply chains. For example, nine of our top ten customers used at least three of our services in 2012. Our customers have expressed their satisfaction with our services by honoring us with multiple supplier and vendor awards. In fact, we have a strong history of being recognized annually by customers with various awards, including Supplier Excellence Awards from FedEx, 3M and PPG Industries in 2013 and 2012 and Logistics Management's "Quest for Quality" award in 2011, regarded as one of the most prestigious awards given for customer satisfaction and performance excellence within our industry. Recruit and retain drivers We believe that driver recruitment and retention is a core operating strength. Our experienced, non-union drivers are critical to our operating model. We recruit and retain drivers by offering attractive compensation and benefit packages, modern equipment, professional driver management and comprehensive training. We estimate that our total compensation for drivers ranks in the top decile of the truckload industry. We provide our drivers with modern, reliable equipment with attractive features, including sleeper bunks, large cabins, air-ride suspensions and anti-lock brakes. Our company-tractors are equipped with communications technology that enables drivers to receive load-related information, directions, pay information, fueling recommendations and e-mail access. We believe our convenient service center locations, modern equipment and substantial regional and dedicated operations help us recruit and retain superior drivers. We focus on driver retention to reduce recruitment cost, improve customer service and maintain high tractor utilization. In addition, experienced drivers tend to have fewer accidents, thereby lowering insurance claims. Our dry-van truckload operations had a driver turnover rate of 79% for 2013, compared to an industry average of 98% for the first nine months of 2013, according to the most current industry data made available by the ATA. We believe our driver-friendly culture and total compensation in the top decile of the truckload industry will be an increasing competitive advantage as the availability of drivers decreases in the future. Optimize high-quality asset base We have a modern, technology-enabled fleet that enables us to efficiently execute our process-driven operations and to consistently deliver high-quality services. We operate a fleet of approximately 1,330 company tractors with an average age of approximately 2.3 years (compared to the industry average of 6.5 years as of 2013, according to ACT Research), which are equipped with the latest in-cab communication and other technologies designed to increase productivity, lower costs and enhance safety, and we utilize approximately 140 tractors provided by independent contractors for a total fleet size of approximately 1,470 tractors. Our fleet also includes approximately 4,450 trailers which have an average age of 4.8 years (compared to an industry average of 8.2 years as of 2013). We believe the investment in a newer tractor and trailer fleet improves service, controls fuel costs, reduces maintenance costs and provides flexibility to manage capital expenditures as warranted by economic Scott C. Arves President and Chief Executive Officer 1715 Yankee Doodle Road Eagan, Minnesota 55121 (651) 686-2500 (Name, address, including zip code, and telephone number, including area code, of agent for service) Table of Contents conditions without negatively impacting the business. The 12 terminals in our network are strategically located across our areas of operation, enabling us to deliver a broad range of services to all of our customers while increasing driver quality of life and retention. Because our terminals are strategically located, we can perform approximately 80% of required maintenance in our own facilities, take advantage of bulk fuel pricing, more closely monitor compliance with safety standards and provide safe parking for our drivers. Our custom-developed information technology platform ties together our fleet, back-office and customers, processing orders, optimizing schedules, dispatching loads, monitoring loads in transit and providing real-time data on profitability. Our network of terminals and back-office support functions can support significantly larger operations and the integration of acquisitions with minimal incremental investment. Our Growth Strategy We have demonstrated the ability to grow our customer base, improve profitability and integrate a sizeable acquisition despite the 2008-2009 U.S. recession, an excess supply of tractors and a capital-constrained operating environment. Since 2006, our primary operating objectives have focused on improving our bottom line and adding services, which improved our annual operating ratio from 98.4% in 2005 to 93.5% in 2013, as well as our adjusted operating ratio from 97.6% in 2005 to 91.3% in 2013. Our goals going forward are to grow our revenues, capture market share, increase our profitability and generate attractive returns on capital. We believe that the processes and procedures established by our management team throughout the organization, our talented workforce, trucking industry trends and our increased financial flexibility following this offering will enable us to continue our earnings growth. We intend to pursue growth through the following initiatives: Expand relationships with existing customers A major component of our growth plan is to gain a larger share of our customers' transportation budgets and increase the number of our services utilized by our customers. In addition, our sales team has been focused on cross-selling our expanded service offering. Since the acquisition of Southern Cal in January 2011, the number of our customers using multiple service offerings increased by 36% in the subsequent two years. By increasing freight volumes and density in our system, we also benefit from better utilization and efficiency, thereby improving our financial performance. We intend to continue to expand our cross-selling efforts across our customer base, with particular focus on what we believe will be higher growth areas dedicated and regional services: Expand dedicated service offering We expect demand for dedicated transportation to grow as more shippers: Outsource non-core activities, such as truckload transportation, in order to avoid onerous regulatory standards, more stringent safety requirements, driver recruiting challenges and more expensive equipment requirements; Minimize their exposure to the volatility in the transportation spot market, which is driven by increased freight demand as the economy improves, the exit of truckload providers who lack scale, the growing shortage of drivers and the rising cost of tractor ownership and maintenance; and Become increasingly concerned about capacity shortages. Expand regional service offering Regional operations provide significant opportunities for us due to: Less competition from smaller operators than in long-haul markets in which services tend to be more commoditized due to the larger number of competitors; Copy to: Jonathan B. Abram Dorsey & Whitney LLP Suite 1500 50 South Sixth Street Minneapolis, Minnesota 55402 Phone: (612) 340-2600 E-mail: abram.jonathan@dorsey.com Patrick Daugherty Foley & Lardner LLP Suite 2800 321 North Clark Street Chicago, Illinois 60654 Phone: (312) 832-4500 E-mail: pdaugherty@foley.com Table of Contents Lower driver pay and easier recruitment due to a better lifestyle for drivers who are able to spend more time at home; and Freight contracts supported by people, processes and sophisticated technologies that enable us to run highly-efficient regional networks. Specifically, we intend to expand our existing Southeast, Midwest and Ohio regional operations by continuing to target new customer freight in these regions. We also continue to evaluate other regions for potential entry. Add new customers We are well-positioned to grow by attracting new customers. During 2013 we added 95 new customers that collectively contributed over $16.5 million in revenues. As we have grown, we have developed a broader base of services, which has enabled us to provide a more comprehensive solution to prospective customers. We believe our larger size and broader service offering relative to smaller competitors and increased financial strength as a result of this offering will enable us to accelerate our growth. Also, we have significantly improved the quality and increased the size of our sales team; from 2006 to 2013, we added seven salespeople, increasing the total from seven to 14. With our expanded suite of services, our reputation for quality and safety and our larger and more qualified sales team, we have improved our positioning with prospective customers to be their "one-stop" dry-van truckload transportation services provider. Continue to focus on operational improvements We are an execution-oriented company, and we believe that operational excellence has been critical to our success. Since the addition of Scott Arves and his management team, we have completed a number of operational improvements that have streamlined our cost structure, improved operating efficiency and enhanced our margins. We also have invested in the people necessary to lead continuous improvement initiatives that instill these disciplines as part of our culture. In order to capitalize on these improvements and enhance our competitive position, we continue to implement additional initiatives, including: Increasing our ability to attract new freight and capture higher-quality revenues by refining our customer bid response process; Driving yield improvement by diversifying our customer and freight mix, improving equipment utilization and increasing our average revenues per loaded mile; Standardizing processes and applying continuous improvement disciplines to achieve more efficient utilization of our tractors, trailers and drivers' available hours of service; Improving customer service and increasing operational efficiencies throughout our customer-facing functions; Continuing to foster accountability and cost discipline; Managing the flow of our tractor capacity through our network to balance freight flows and reduce deadhead miles; and Improving driver satisfaction to enhance performance and reduce attrition costs. Selectively pursue acquisitions We seek to identify complementary acquisition targets that can be purchased at attractive valuations. We believe that, due to the highly-fragmented nature of the U.S. truckload market, significantly increased operating costs and a population of aging owners of truckload carriers without a Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer (Do not check if a smaller reporting company) Smaller reporting company Table of Contents succession plan in place, there is an abundance of potential acquisition targets. We also believe our management team is highly experienced in successfully completing and integrating significant acquisitions, such as our acquisition of Southern Cal. We believe we can improve the culture and performance of acquired entities as part of our company and that the opportunities we provide for target companies and their employees make us an acquirer-of-choice. The ideal targets for these transactions offer experienced, trained drivers, opportunities for geographical expansion (as we currently have a limited presence in the Western and mid-Atlantic U.S.), additional services (particularly regional and dedicated truckload services, brokerage activities and intermodal services), limited customer overlap, relatively modern equipment and non-unionized labor. We are confident there are, and will continue to be, opportunities to acquire companies at valuations that will be accretive to earnings and provide a return on invested capital greater than would result from organic fleet expansion, although there is no guarantee that we will be able to identify and execute on any opportunities at valuations that will be accretive to earnings and provide an anticipated return on invested capital in excess of the return from organic fleet expansion. Our current infrastructure is scalable and can support the additional freight volume provided by acquisitions. The deleveraging of our balance sheet as a result of this offering will position us to selectively pursue more acquisitions. Our Industry Opportunity The U.S. trucking industry is large, fragmented and highly competitive, with no dominant participant. According to the ATA, the U.S. trucking industry generated approximately $642 billion in revenues, including for-hire truckload carriers and private fleets, in 2012, and accounted for approximately 81% of all domestic spending on freight transportation. According to the ATA, for-hire truckload carrier revenues totaled $297 billion in 2012, representing 37.5% of all domestic freight transportation revenues. The ATA expects that for-hire truckload carrier revenues will grow to $516 billion by 2024, representing an average annual increase of 4.7% from 2012, and will account for 39.6% of total domestic freight transportation revenues by 2024, representing a 2.1% increase in market share as compared to 2012. There are thousands of truckload carriers in the United States, most of which operate fewer than 100 trucks. The 20 largest for-hire truckload transportation companies are estimated to constitute approximately 6.1% of the total for-hire truckload market in the United States, according to 2012 revenue data published by Transport Topics. Demand for truckload services in the United States is primarily driven by the health of the overall economy, particularly consumer demand and manufacturing output. Supply is dictated by the number of tractors and drivers available within the market. Freight rates fluctuate as a result of varying supply and demand within specific regional markets. We believe that the following are key factors affecting demand and supply within the truckload industry. Key Factors Affecting Demand Environment U.S. economy continues to expand. Since the 2008-2009 U.S. recession, general economic conditions in the U.S. have slowly improved. Freight volumes generally increase with economic expansion. Continued expansion of the U.S. economy should result in an increase in overall U.S. freight. Demand growing for integrated logistics services and supply chain visibility. We believe companies continue to seek integrated transportation and logistics providers that can serve as a single point of contact for multiple logistics needs. We believe shippers will continue to consolidate their vendor bases to improve operational efficiencies and increase supply chain visibility. Demand increasing for value-added services. As specialization in the transportation and logistics industry continues, shippers are increasingly demanding value-added services, including those we The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. Table of Contents offer, such as solo operations, dedicated truckload, expedited team, trailer-on-flat-car, regional truckload and freight brokerage. Key Factors Affecting Supply Environment Availability of Class 8 tractor drivers. The trucking industry has historically experienced substantial difficulty attracting and retaining qualified drivers, and the ATA estimates that the truckload industry currently has a shortage of approximately 25,000 drivers. This shortage is expected to rise to approximately 240,000 drivers by 2022 due to the aging driver population and regulatory constraints on supply. Carriers with effective recruiting and retention programs and competitive compensation and benefits, such as our company, should be in a superior position to mitigate potential effects from further deterioration of the available driver pool. Size and age of Class 8 tractor fleets. Sales of new tractors decreased during the 2007 to 2010 period, and the effective age of Class 8 tractors in the U.S. increased from 5.7 years in 2006 to 6.5 years in 2013, according to ACT Research. Cumulatively, ACT Research estimates that the trucking industry lost approximately 10% of tractor capacity from 2007 to 2011. The number of tractors available remains below pre-recession levels. As a result, truckload companies with larger, newer fleets will have competitive and operational advantages in a recovering market. Increasingly restrictive regulatory environment. The U.S. trucking industry is heavily regulated by various government agencies, primarily for safety and environmental factors. Compliance with these regulations can be burdensome, particularly for smaller carriers with narrower asset bases over which to spread their costs. In addition, many carriers may lose operating flexibility and productivity due to the regulations, thereby effectively reducing industry capacity. Increasing barriers to entry. Historically, barriers to entry in the truckload industry have been low. As a result, the industry largely has consisted of fleets with fewer than 100 tractors, according to the FMCSA. In recent years, however, we believe barriers to entry have increased substantially due to rising tractor prices resulting from more stringent EPA emissions standards, increasing health and benefit costs for drivers, required investments in technology and more rigorous lending standards. Such an environment should favor well-capitalized carriers with advanced technology and stable customer bases.
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+SUMMARY OF PROSPECTUS You should read the following summary together with the more detailed business information, financial statements and related notes that appear elsewhere in this Prospectus. In this Prospectus, unless the context otherwise denotes, references to "we," "us," "our", "At Play", "APV", 'At Play Vacations" and "Company" are to At Play Vacations, Inc. and our wholly owned subsidiary Quality Resort Hotels, Inc.. A Cautionary Note on Forward-Looking Statements This Prospectus contains forward-looking statements, which relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential," or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled "Risk Factors," that may cause our industry's actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by these forward-looking statements. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results.
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+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all the information that you should consider before investing in the common stock. You should carefully read the entire Prospectus, including Risk Factors , Management s Discussion and Analysis of Financial Condition and Results of Operations and the Financial Statements, before making an investment decision. Company management has determined that it is in the best interests of the Company to become a reporting company under the Securities And Exchange Act of 1934, and endeavor to establish a public trading market for the Company common stock, because management believes: (i) it will increase the Company s profile as an active company in the Medical Practice Software Market, giving it greater identity and recognition which will help in conducting its business: (ii) it will make it easier for the Company to obtain terms from vendors and negotiate licenses for products it selects to market; (iii) it will make it easier for the Company to attract additional equity capital, which the Company needs in order to further implement its business plan; and (iv) it will give existing shareholders who funded the Company on a private basis in the past, the opportunity to exit a part or all of their investment in the Company and diversify their investments. However, the Company is a development stage company; this offering will not raise additional capital for the Company since only the shares of selling shareholders are being registered; the Company will have to raise approximately one million dollars ($1,000,000) in additional capital over the next 12 months in order to fully pursue its business plan and there is no assurance it will be successful in doing so; being a public company entails significant additional expense which the Company will have to fund; there is currently no public market for the Company s common stock and one may never develop; and if a public market is created, it is likely the Company s common stock will be traded as a penny stock. As a result, prospective investors are cautioned to carefully read the risk factors set forth herein prior to making an investment decision. CALCULATION OF REGISTRATION FEE Title of each class of securities to be registered Fee Amount to be Registered Proposed Maximum Amount of Offering Price Proposed Maximum Aggregate Offering Price (1) Registration Per Share (1) Common Stock, $0.001 par value (2) 450,000 $ 0.02 $ 9,000 $ 1.23 (1) Estimated solely for the purpose of computing the amount of the registration fee pursuant to Rule 457(o) of the Securities Act of 1933, as amended. Includes stock to be sold by selling shareholders. (2) The shares of common stock being registered hereunder are being registered for resale by certain selling shareholders named in the prospectus. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission, acting pursuant to Section 8(a) may determine. The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Corporate Background and Our Business The Company is a development stage company that is in the process of implementing its business plan, but has had no revenues to date. We are not a blank check company and have no plans or intention to engage in a merger or acquisition with an unidentified company, companies, entity or person, nor do we nor any of our affiliates intend for the Company, once it is publicly traded, to be used as a vehicle for some other private company to become a publicly traded company. The Company was originally formed as IMC Holdings, LLC, a Texas limited liability company ("LLC") on August 10, 2005 and operated as an LLC. On August 13, 2012, the LLC merged with and into IMC Holdings Inc. (the "Merger"). IMC Holdings Inc. was incorporated under the laws of the State of Nevada on August 26, 2011. Prior to the merger, IMC Holdings, LLC had minimal business operations other than maintaining its good standing in the state of Texas. Pursuant to the Merger, 1,000,000 shares of common stock of the Company were issued to Robert Zayas, M.D. in exchange for all of the membership interests in IMC Holdings, LLC. As a result of the Merger, the license agreement between Z Healthcare Management LP, a Texas limited partnership ( ZHM )and the LLC became null and void and, thus, shortly after the Merger, on September 1, 2012, IMC Holdings Inc. obtained the rights to license (the "License") the software owned by ZHM whose General Partner is Z Healthcare Systems, Inc., a Texas corporation and whose majority shareholder is Robert Zayas, M.D, (also known as Roberto Zayas Jr., M.D.) the majority shareholder, President and a director of the Company. On September 1, 2012, in exchange for the License, the Company issued 19,000,000 common shares to ZHM, which was the previously agreed upon valuation with the LLC for the License. Additionally, on September 1, 2011, the Company issued an aggregate of 5,050,000 to other founders of the Company for providing consulting and business advisory services. The License enables the Company to sub-license a comprehensive electronic medical practice management (EPM) and electronic medical records (EMR) software package (the "Software"). The Software is designed to support a full range of medical practices and medical specialties, allowing physicians, groups, plans and healthcare organizations to improve patient care, streamline work flow and meet objectives while cutting costs, improving productivity and maximizing profits. The Software provides a potential licensee with scheduling, registration, custom reporting, billing, collections, and the ability to electronically manage medical records. Also, the data obtained from the use of the Software may be used for outcomes analysis and to track marketing in a medical practice. The Software can be customized, using many medical specialty specific templates available within the Software. Customization services are offered by IMC or the licensee may choose to customize the Software using its own resources. The EMR part of the Software streamlines and digitizes all aspects of the documentation of patient care. The EPM system integrates with EMR seamlessly and electronically facilitates the use of that data with the requirements of billing, collections, claims, scheduling, reports, lab results, imaging, referrals and other clinical and practice procedures, as well as payroll services, online banking, accounting and bank account reconciliation. The Software provides a level of connectivity that allows access across physical locations and staff functions, improves the speed and quality of patient care and provides a high level of accuracy. The Software provides data displays that are viewer "friendly", which we believe is in keeping with the progression of the natural workflow to which medical office workers have become accustomed. The Software minimizes the number of "click-throughs" to key functions, thereby increasing efficiency. The Software's data mining capabilities are designed to group and make accessible information we believe has not been previously available, enabling more effective treatment protocols and outcome studies to be undertaken. Explanatory Note This Registration Statement on Form S-1/A (Amendment No. 1) is being filed to update the financial statement to included the period ended September 30, 2013 and an updated Management Discussion and Analysis to reflect the updated financial statements. The Software also provides an integrated system that links all the functions of the medical front office, back office, collections and billing (collectively the "Modules" and individually a "Module") while also providing each Module the ability to be used independently. This, combined with the Software s what we have named Decision Tree design intelligence allows for increased functionality and flexibility. Decision Trees are set up as snapshots of procedures, workflow and decision flow charts and are adapted to suit the specific requirements of different specialties or applications. With the flexibility of our Software and Decision Tree design intelligence, we aim to provide a useful tool for medical clinics and physicians offices to enhance their own programs and product lines by cutting costs and improving service. Meeting our capital requirement will be directly contingent on Robert Zayas, M.D. and his decision to advance us capital in the event that we are not able to raise capital from other sources. Relationship with our majority shareholder Robert Zayas, M.D., a director of the Company and our Chief Executive Officer and Chief Financial Officer, owns a majority interest in ZHM. In as much as Dr. Zayas' controlling interest in the Company is based upon his personal ownership of 1,000,000 shares of common stock and his majority ownership interest of ZHM, we reviewed and analyzed whether or not the Company is the primary beneficiary of ZHM. We concluded that the Company has a variable interest in ZHM but it is not the primary beneficiary of ZHM since it is not absorbing any financial profits or losses of ZHM. Since the inception of the Company beginning with the formation of the LLC on August 10, 2005, to date we have borrowed monies from Dr. Zayas on an as needed basis totaling $68,595, which sum is due on demand together with interest at the rate of ten per cent per annum. We will need to obtain additional financing of approximately $1,000,000 to maintain continuing operations for the 12 month period commencing on January 1, 2014. We have not as yet sought to obtain the additional financing from sources other than Dr. Zayas. The Company's principal offices are located at 12121 Jones Rd., Houston, Texas 77070. Our telephone number is 858-518-0447. Dealer Prospectus Delivery Obligation Until _______________, all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers' obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions. Subject to Completion Dated January 16, 2014 PROSPECTUS IMC HOLDINGS, INC. 450,000 Shares of Common Stock The selling stockholders named in this prospectus are offering 450,000 shares of common stock of IMC Holdings, Inc., a Nevada corporation (the "Company"), at a price of $0.02 per common share. The selling stockholders currently hold 1.76% of our common stock. We will not receive any of the proceeds from the sale of these shares. The shares were acquired by the selling stockholders directly from us in a private offering of our common stock that was exempt from registration under the securities laws. The selling stockholders have set an offering price for these securities of $0.02 per common share until the common stock becomes quoted by a market maker on the Over-the-Counter Bulletin Board. This is a fixed price for the duration of the offering. The selling stockholders are an underwriter, within the meaning of Section 2(11) of the Securities Act. Any broker-dealers or agents that participate in the sale of the common stock or interests therein are also be deemed to be an "underwriter" within the meaning of Section 2(11) of the Securities Act. Any discounts, commissions, concessions or profit earned on any resale of the shares may be underwriting discounts and commissions under the Securities Act. The selling stockholders, who are an "underwriter" within the meaning of Section 2(11) of the Securities Act, are subject to the prospectus delivery requirements of the Securities Act. See Security Ownership of Certain Beneficial Owners for more information about the selling stockholders. Please note that this registration statement covers the sale of 1.76% of the Company s outstanding securities.
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY As used in this prospectus, references to the Company, we, our , us or Lion Print refer to Lion Print Corporation unless the context otherwise indicates. The following summary highlights selected information contained in this prospectus. Before making an investment decision, you should read the entire prospectus carefully, including the Risk Factors section, the financial statements, and the notes to the financial statements. Our Company Lion Print Corporation was incorporated on November 7, 2013, under the laws of the State of Nevada, for the purpose of engaging in the printing services business, with the objective of becoming a recognized leader in our targeted market for graphic design solution, printing, and finishing services. The primary focus of Lion Print Corporation will be providing following printing services: printing of business cards, brochures, single-colour business papers, full-colour annual report ,envelopes, calendars, greeting cards, labels and stickers, large format posters, letterhead, mini cards, notepads, sell sheets: flyers, menus, invite folders, tickets, passes, custom booklets, folders. We also intend to provide other services such as typesetting, layout, image setting, folding, numbering, perforating, scoring, drilling, laminating items to any size of business. We will also focus on providing variety of services to private customers, by taking orders in smaller volumes. We will provide wide range of printing and related services to customers in our target market. We also will provide printing services in 3D format which is innovation for printing industry in Ukraine and we hope will gain popularity within our target market. We have not commenced any printing activities. Liliia Yasinska, our sole officer and director, does not devote all of her time to our current operations and it is expected that she will devote between 5 to 10 hours per week to our operations on an ongoing basis. We are a development stage company that has not realized any revenues to date, and our accumulated deficit as of November 30, 2013 is $5,583. As of March 27, 2014, we have no cash on hand, and to date we have raised an aggregate of $5,555 through a loan from our sole officer and director, Liliia Yasinska. The loan is due on demand, interest free, unsecured and has no term. Imputed interest of $28 was recorded as donated capital for the year ended November 30, 2013. Proceeds from the loan were used for working capital. Additionally, on November 7, 2013, Ms. Yasinska was issued 5,000,000 shares of our common stock as founders shares in exchange for being named a director of the Company. The implied aggregate price of our common stock based on the offering price of $0.04 is $200,000 for such 5,000,000 shares. Our total stockholders equity (deficit) as of November 30, 2013 is $5,555. Our independent auditor has issued an audit opinion for our Company which includes a statement expressing substantial doubt as to our ability to continue as a going concern. We presently do not expend any funds because we presently have no cash and depend on our sole officer and director, Liliia Yasinska, to fund our operations. Upon the sale of all the shares in this offering, if we are able to sell such shares, we anticipate expending approximately $6,700 per month. Assuming the sale of all shares in the offering, we expect to run out of funds 12 months after completion of the offering. We must raise additional capital in order to continue operations and to implement our 12-month plan of operation. To implement our plan of operations we require a minimum funding of $80,697 for the next twelve months. After twelve months period we may need additional financing. If we do not generate any revenue we may need a minimum of $10,000 of additional funding to pay for SEC filing requirements. Liliia Yasinska, our sole officer and director, has agreed to loan us funds, however, she has no firm commitment, arrangement or legal obligation to advance or loan funds to the Company. If we do not generate any or sufficient revenue and Ms. Yasinska does not loan us funds, then we plan to raise such additional funding by way of private debt or equity financing, but have not commenced any activities to raise such funds. We cannot provide any assurance that we will be able to raise such additional funding. If we do not raise sufficient amount of funding, our business will fail and you will lose your entire investment in us. The Company s principal offices are located at G. Washington St., 17/67, Lviv, Ukraine. Our telephone number is +380-685511850. Because we are a shell company, the Rule 144 safe harbor is not available for the resale of any restricted securities issued by us in any subsequent unregistered offering. This will likely make it more difficult for us to attract additional capital through subsequent unregistered offerings because purchasers of securities in such unregistered offerings will not be able to resell their securities in reliance on Rule 144, a safe harbor on which holders of restricted securities usually rely to resell securities. The information in this prospectus is not complete and may be amended. The Registrant may not sell these securities until the Registration Statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. PRELIMINARY PROSPECTUS LION PRINT CORPORATION 2,500,000 SHARES OF COMMON STOCK This prospectus relates to the offer and sale of a maximum of 2,500,000 shares (the Maximum Offering ) of common stock, $0.00001 par value ( Common Shares ) by Lion Print Corporation, a Nevada corporation ( we , us , our , Lion Print , Company or similar terms). There is no minimum for this offering. The offering will commence promptly on the date upon which this prospectus is declared effective by the SEC and will continue for 16 months. We do not anticipate making any extensions to the offering. We will pay all expenses incurred in this offering. We are an emerging growth company under applicable Securities and Exchange Commission rules and will be subject to reduced public company reporting requirements. The offering of the 2,500,000 shares is a best efforts offering, which means that our sole officer and director will use her best efforts to sell the common stock and there is no commitment by any person to purchase any shares. The shares will be offered at a fixed price of $0.04 per share for the duration of the offering. There is no minimum number of shares required to be sold to close the offering. Proceeds from the sale of the shares will be used to fund the initial stages of our business development. We have not made any arrangements to place funds received from share subscriptions in an escrow, trust or similar account. Any funds raised from the offering will be immediately available to us for our immediate use. This is a direct participation offering since we are offering the stock directly to the public without the participation of an underwriter. Our sole officer and director will be solely responsible for selling shares under this offering and no commission will be paid on any sales. Prior to this offering, there has been no public market for our common stock and we have not applied for the listing or quotation of our common stock on any public market. We have arbitrarily determined the offering price of $0.04 per share in relation to this offering. The offering price bears no relationship to our assets, book value, earnings or any other customary investment criteria. After the effective date of the registration statement, we intend to seek a market maker to file an application with the Financial Industry Regulatory Authority ( FINRA ) to have our common stock quoted on the OTC Bulletin Board. We currently have no market maker who is willing to list quotations for our stock. There is no assurance that an active trading market for our shares will develop or will be sustained if developed. We are a shell company within the meaning of Rule 405, promulgated pursuant to Securities Act, because we have nominal assets and nominal operations. Because we are a shell company, the Rule 144 safe harbor is not available for the resale of any restricted securities issued by us in any subsequent unregistered offering. This will likely make it more difficult for us to attract additional capital through subsequent unregistered offerings because purchasers of securities in such unregistered offerings will not be able to resell their securities in reliance on Rule 144, a safe harbor on which holders of restricted securities usually rely to resell securities. You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with information different from that contained in this prospectus. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of our common shares. Our business is subject to many risks and an investment in our shares of common stock will also involve a high degree of risk. You should carefully consider the factors described under the heading risk factors beginning on page 8 before investing in our shares of common stock. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. The date of this prospectus is _____________, 2014 . We plan to raise the additional funding for our twelve month business plan by selling the 2,500,000 shares in this offering. We cannot provide any assurance that we will be able to sell any of the shares being offered to raise sufficient funds to proceed with our twelve month business plan. From inception until the date of this filing we have had limited operating activities, primarily consisting of the incorporation of our company, the initial issuance of shares of common stock to our sole officer and director, borrowing $5,555 from our sole officer and director, completing our business plan and developing our website. Our financial statements from inception from inception on November 7, 2013, through November 30, 2013, report no revenues and a net loss of $5,583. Our independent auditor has issued an audit opinion for our Company which includes a statement expressing substantial doubt as to our ability to continue as a going concern. Liliia Yasinska, our sole officer and director did not agree to serve as an officer or director of the Company at least in part due to a plan, agreement or understanding that she would solicit, participate in, or facilitate the sale of the enterprise to (or a business combination with) a third party which desires to obtain or become a public reporting entity, and Ms. Yasinska confirms that she has no such present intention. As of the date of this prospectus, there is no public trading market for our common stock and no assurance that a trading market for our securities will ever develop. We are an emerging growth company within the meaning of the federal securities laws. For as long as we are an emerging growth company, we will not be required to comply with the requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, the reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and the exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We intend to take advantage of these reporting exemptions until we are no longer an emerging growth company. For a description of the qualifications and other requirements applicable to emerging growth companies and certain elections that we have made due to our status as an emerging growth company, see RISK FACTORS RISKS RELATED TO THIS OFFERING AND OUR COMMON STOCK - WE ARE AN `EMERGING GROWTH COMPANY AND WE CANNOT BE CERTAIN IF THE REDUCED DISCLOSURE REQUIREMENTS APPLICABLE TO EMERGING GROWTH COMPANIES WILL MAKE OUR COMMON STOCK LESS ATTRACTIVE TO INVESTORS on page 6 of this prospectus. This is a direct participation offering since we are offering the stock directly to the public without the participation of an underwriter. Our sole officer and director will be solely responsible for selling shares under this offering and no commission will be paid on any sales. There has been no market for our securities and a public market may never develop, or, if any market does develop, it may not be sustained. Our common stock is not traded on any exchange or on the over-the-counter market. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with the Financial Industry Regulatory Authority ( FINRA ) for our common stock to be eligible for trading on the Over-the-Counter Bulletin Board. We do not yet have a market maker who has agreed to file such quotation service or that any market for our stock will develop. You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with information different from that contained in this prospectus. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of our common shares. Under U.S. federal securities legislation, our common stock will be penny stock . Penny stock is any equity that has a market price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require that a broker or dealer approve a potential investor s account for transactions in penny stocks, and the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased. In order to approve an investor s account for transactions in penny stocks, the broker or dealer must obtain financial information and investment experience objectives of the person, and make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks. The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prepared by the Commission relating to the penny stock market, which, in highlight form sets forth the basis on which the broker or dealer made the suitability determination. Brokers may be less willing to execute transactions in securities subject to the penny stock rules. This may make it more difficult for investors to dispose of our common stock and cause a decline in the market value of our stock. Disclosure also has to be made about the risks of investing in penny stocks in both public offerings and in secondary trading and about the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks. THE OFFERING Securities offered: 2,500,000 shares of our common stock, par value $0.00001 per share. Offering price: $0.04 Duration of offering: The 2,500,000 shares of common stock are being offered for a period of 16 months. Net proceeds to us: $100,000, assuming the maximum number of shares sold. For further information on the Use of Proceeds, see page 14. Market for the common shares: There is no public market for our shares. Our common stock is not traded on any exchange or on the over-the-counter market. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with the Financial Industry Regulatory Authority ( FINRA ) for our common stock to eligible for trading on the Over The Counter Bulletin Board. We do not yet have a market maker who has agreed to file such application. There is no assurance that a trading market will develop, or, if developed, that it will be sustained. Consequently, a purchaser of our common stock may find it difficult to resell the securities offered herein should the purchaser desire to do so when eligible for public resale. Shares outstanding prior to offering: 5,000,000 Shares outstanding after offering: 7,500,000
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001599613_mammoth_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001599613_mammoth_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001606974_environmen_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001606974_environmen_prospectus_summary.txt
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+PROSPECTUS SUMMARY Company Overview Pharmamed Inc is a development stage company incorporated on April 25, 2014 under the laws of the State of Delaware. Our fiscal year end is December 31. Our principal office is located at 9435 Bormet Drive Unit 1A Mokena, IL 60448. Our telephone number is 708-267-9998 and our e-mail is daniel@pathwaysfinancial.biz Since becoming incorporated, we have not made any significant purchases or sales of assets, nor have we been involved in any mergers, acquisitions or consolidations and have no intentions of doings so. Pharmamed has never declared bankruptcy, never been in receivership, and never been involved in any legal actions or proceedings. We were incorporated on April 25th as Koala Unlimited Inc. On June 6, 2014 the Company amended its Articles of Incorporation and changed its name to Pharmamed Inc which management felt better described its proposed business operations. We plan to lease growing space and related facilities to licensed marijuana growers and dispensary owners for their operations. Additionally, we plan to provide a variety of services to the cannabis industry, such as compliance, support and consulting. As of June 30, 2014, the date of company's last financial statements, Pharmamed has raised $1,950 through the sale of common stock. This sale was a purchase of 19,500,000 shares by the Company s officer and director Daniel Gallagher and by the other founding shareholders. As of June 30, 2014, we had $1,360 of cash on hand and had expenses from inception April 25, 2014 to June 30, 2014 of $4,865, which was related to corporate start-up fees. As of the date of this prospectus, we have not yet generated or realized any revenues from our business operations. The Company believes that we will need a minimum $50,000 to maintain the corporate entity, accounting and filings over the next 12 months and a minimum of $25,000,000 to carry out our operations and marketing preparation for the next 12 months. For our audited financial information please see "Financial Statement" within this document below. Shell Company Status We are considered a shell company as defined by Rule 12b-2 of the Exchange Act. Rule 12b-2 defines a shell company as a registrant that has nominal operations and assets consisting solely of cash and cash equivalents and nominal other assets. Our shell company status prevents the resale of our shares under Rule 144(i) unless and until 12 months after we are no longer considered a shell company. We caution investors as to the highly illiquid nature of an investment in our shares. In addition, until our shell company status has been removed, we will be unable to register shares for issuance in equity compensation plans and agreements on Form S-8. Terms of Offering This is a self-underwritten public offering with no minimum purchase requirement. Common shares will be offered on a best efforts basis and we do not intend to use an underwriter for this offering. We do not have an arrangement to place the proceeds from this offering in an escrow, trust, or similar account. And funds raised from the offering will be immediately available to us for our immediate use. Market for our common stock Our common stock is not quoted on a market or securities exchange. We cannot provide any assurance that an active market in our common stock will develop. Use of proce Management As of the date of this prospectus, Pharmamed has two Directors, Geoffrey Thompson and Daniel Gallagher (President, Treasurer, CFO, CEO, and Secretary). Our Officer has assumed responsibility for all planning, development and operational duties, and will continue to do so throughout the beginning stages of the business plan. (table of contents) The Offering Pharmamed Inc. is offering up to 10,000,000 shares of common stock at an offering price of $10.00 per share. There is currently no public market for our common stock. Moreover, there is no trading symbol assigned to the common stock. Our Officer and Director currently owns 9,000,000 shares of restricted common stock. Potential investors must be aware that if we are unable to raise proceeds through this offering we will be unable to complete our business plan, resulting in businesses failure and a complete loss of any investment made into the Company. JOBS Act The Company is electing to not opt out of JOBS Act extended accounting transition period. This may make its financial statements more difficult to compare to other companies. Emerging Growth Company The recently enacted JOBS Act is intended to reduce the regulatory burden on emerging growth companies. The Company meets the definition of an emerging growth company and so long as it qualifies as an emerging growth company," it will, among other things: be temporarily exempted from the internal control audit requirements Section 404(b) of the Sarbanes-Oxley Act be temporarily exempted from various existing and forthcoming executive compensation-related disclosures, for example: "say-on-pay", "pay-for-performance", and "CEO pay ratio". be temporarily exempted from any rules that might be adopted by the Public Company Accounting Oversight Board requiring mandatory audit firm rotation or supplemental auditor discussion and analysis reporting; be temporarily exempted from having to solicit advisory say-on-pay, say-on-frequency and say-on-golden-parachute shareholder votes on executive compensation under Section 14A of the Securities Exchange Act of 1934, as amended; be permitted to comply with the SEC s detailed executive compensation disclosure requirements on the same basis as a smaller reporting company; and, be permitted to adopt any new or revised accounting standards using the same timeframe as private companies (if the standard applies to private companies). Our company will continue to be an emerging growth company until the earliest of: the last day of the fiscal year during which we have annual total gross revenues of $1 billion or more; the last day of the fiscal year following the fifth anniversary of the first sale of our common equity securities in an offering registered under the Securities Act; the date on which we issue more than $1 billion in non-convertible debt securities during a previous three-year period; or the date on which we become a large accelerated filer, which generally is a company with a public float of at least $700 million (Exchange Act Rule 12b-2). (table of contents) RISK FACTORS This section of the prospectus discloses all material risks known to us. We do not make, nor have we authorized any other person to make, any representation about the future market value of our common stock. In addition to the other information contained in this prospectus, the following factors should be considered carefully in evaluating an investment in our securities. If any of the risks discussed below materialize, our common stock could decline in value or become worthless. The price of our common stock was set arbitrarily Our common stock is presently not traded on any market or securities exchange and we have not applied for listing or quotation on any public market. We are offering the common shares at a price of $10.00 per share. Such offering price does not have any relationship to any established criteria of value, such as book value or earnings per share and was entirely arbitrary and is a significant increase in price since inception in April. The price of our common stock is not based on past earnings, nor is the price of our common stock indicative of the current market value of the assets owned by us. No valuation or appraisal has been prepared for our business and potential business expansion. No underwriter has engaged in any due diligence No underwriter has engaged in any due diligence activities, including confirming the accuracy of the disclosure in the prospectus and providing input as to the offering price. Market Information There is presently no public market for Pharmamed s common stock. Pharmamed anticipates applying for trading of its common stock on the Over-the-Counter Bulletin Board (the "OTC Bulletin Board") upon the effectiveness of the registration statement of which this prospectus forms a part. However, Pharmamed can provide no assurance that its shares will be traded on the OTC Bulletin Board or, if traded, that a public market will materialize. A public market for our common stock may never develop for several reasons, including the risks posed by the uncertain legal landscape pertaining to the sale of marijuana. We have a limited operating history and may never be profitable. Since we have not yet recently commenced operations under our new business plan, it is difficult for potential investors to evaluate our business. We will need to raise additional capital in order to fund our operations. We will need to raise a minimum of $25 million in this offering to implement our business plan. There can be no assurance that we will be profitable or that the shares which may be sold in this offering will have any value. There is substantial doubt about our ability to continue as a going concern. Our financial statements have been prepared on a going concern basis which assumes we will be able to realize its assets and discharge our liabilities in the normal course of business for the foreseeable future. As of June 30. 2014, we had $1,360 of cash on hand. We incurred a loss since Inception (April 25, 2014) resulting in an accumulated deficit of $(4,865) as of June 30, 2014 and further losses are anticipated in the development of our business. Our ability to continue as a going concern is dependent upon our becoming profitable in the future and, or, obtaining the necessary financing to meet our obligations and repay its liabilities arising from normal business operations when they come due. There is no guarantee that we will be successful in achieving these objectives. On June 10th, 2014 we signed an agreement with Lambert Private Equity, LLC. The agreement provides that Lambert shall invest up to USD$100,000,000 (the "Commitment Amount") to purchase the Company s common stock. This is a voluntary agreement on the part of the company. That is, according to the Agreement, in the event that the company is actually trading on an agreed upon exchange, after a 30 day trading period, in which price and volume are established, the company may seek a draw down wherein Lambert, using the 30 day price trading average, would purchase up to $2,000,000.00 of the company stock per draw down per the agreement. Further, there is no assurance that Lambert will provide funding if needed nor that the company will need to activate the agreement. On June 10th, 2014 we signed an agreement with Lambert Private Equity, LLC. The agreement provides that Lambert shall invest up to USD$100,000,000 (the "Commitment Amount") to purchase the Company s common stock, $.0001 par value per share (the "Common Stock"); and such investments will be made in reliance upon the provisions of Section 4(2) under the Securities Act of 1933, as amended (the "1933 Act"), Rule 506 of Regulation D, and the rules and regulations promulgated thereunder. As an inducement to Lambert to enter into this Agreement and as consideration for making the investment, the Company has agreed to issue to Lambert a Commitment Fee 2% of the Commitment Amount in Shares at a par value of $.0001 per share, but subject to the limitation set forth in Section 2(e) of this Agreement. Initially the Company shall issue Investor 285,715 Shares. The parties acknowledge that the Commitment Fee is part of the investment structure and is not a fee paid for services Pharmamed s agreement with Lambert Private Equity LLC has specific registration rights that could affect potential shareholder rights. Lambert Private Equity holds shares within Pharmamed Inc, per a commitment fee and will not be able to add additional funding if the company holds more than 4.9% ownership. The company will be able to draw down on $2,000,000 at a time per the agreement. Please see and read the Lambert Private Equity Agreement per the Exhibit. Overall Limit on Common Stock Issuable. Notwithstanding anything contained herein to the contrary, if during the Open Period the Company becomes listed on an exchange that limits the number of shares of Common Stock that may be issued without shareholder approval, then the number of Shares issuable by the Company pursuant to this Agreement, shall not exceed that number of the shares of Common Stock that may be issuable without shareholder approval, (the "Maximum Common Stock Issuance"), unless the issuance of Shares, including any Common Stock to be issued pursuant to this Agreement, in excess of the Maximum Common Stock Issuance shall first be approved by the Company's shareholders. There can be no assurances that our common stock will ever be listed in which case we would not be permitted to put shares to Lambert under this agreement. The parties understand and agree that the Company's failure to seek or obtain such shareholder approval shall in no way adversely affect the validity and due authorization of the issuance and sale of Shares hereunder or the Investor's obligation in accordance with the terms and conditions hereof to purchase a number of Shares in the aggregate up to the Maximum Common Stock Issuance limitation, and that such approval pertains only to the applicability of the Maximum Common Stock Issuance limitation provided in this Section 2(i). (see exhibit for more detail) . If and when initiated this will cause significant dilution to the company s shareholder base. The Lambert Agreement is a voluntary agreement on the part of the company. That is, according to the Agreement, in the event that the company is actually trading on an agreed upon exchange, after a 30 day trading period, in which price and volume are established, The company, may seek a draw down wherein Lambert, using the 30 day price trading average,. This would cause a dilution to existing shareholders. Consequently, the company will utilize the Lambert Agreement only when and if absolutely necessary to meet financial demands. Further, there is no assurance that Lambert will provide funding if needed nor that the company will need to activate the agreement. (table of contents) We may be unable to acquire the properties that are critical to our proposed business. Our business plan involves the acquisition of properties which will be leased to marijuana growers. There can be no assurance that we will be able to obtain the capital needed to purchase any properties. Our failure to obtain capital may significantly restrict our proposed operations. We need capital to operate and fund our business plan. We do not know what the terms of any future capital raising may be but any future sale of our equity securities will dilute the ownership of existing stockholders and could be at prices substantially below the price of the shares of common stock sold in this offering. The failure of us to obtain the capital which it requires may result in the slower implementation of our business plan. Our proposed business is dependent on laws pertaining to the marijuana industry. Continued development of the marijuana industry is dependent upon continued legislative authorization of marijuana at the state level. Any number of factors could slow or halt progress in this area. Further, progress, while encouraging, is not assured. While there may be ample public support for legislative action, numerous factors impact the legislative process. Any one of these factors could slow or halt use of marijuana, which would negatively impact our proposed business. As of May 31, 2014, 21 states and the District of Columbia allow its citizens to use medical marijuana. Additionally, voters in the states of Colorado and Washington approved ballot measures last November to legalize cannabis for adult use. The state laws are in conflict with the federal Controlled Substances Act, which makes marijuana use and possession illegal on a national level. The Obama administration has effectively stated that it is not an efficient use of resources to direct law federal law enforcement agencies to prosecute those lawfully abiding by state-designated laws allowing the use and distribution of medical marijuana. However, there is no guarantee that the administration will not change its stated policy regarding the low-priority enforcement of federal laws. Additionally, any new administration that follows could change this policy and decide to enforce the federal laws strongly. Any such change in the federal government s enforcement of current federal laws could cause significant financial damage to us and its shareholders. Further, and while we do not intend to harvest, distribute or sell cannabis, by leasing facilities to growers of marijuana, we could be deemed to be participating in marijuana cultivation, which remains illegal under federal law, and exposes us to potential criminal liability, with the additional risk that our properties could be subject to civil forfeiture proceedings. At the moment, it is our sole intent to only conduct business within the state of Colorado. We intend to abide by all the state and local rules associated with getting a particular property legally permitted to conduct business within the medical marijuana space. At any time in any town, the laws may change that would not allow us to continue leasing a space for its intended business purpose. The marijuana industry faces strong opposition. It is believed by many that large well-funded businesses may have a strong economic opposition to the marijuana industry. We believe that the pharmaceutical industry clearly does not want to cede control of any product that could generate significant revenue. Further, the medical marijuana industry could face a material threat from the pharmaceutical industry, should marijuana displace other drugs or encroach upon the pharmaceutical industry s products. The pharmaceutical industry is well funded with a strong and experienced lobby that eclipses the funding of the medical marijuana movement. Any inroads the pharmaceutical industry could make in halting or impeding the marijuana industry could have a detrimental impact on our proposed business. Marijuana remains illegal under Federal law. Marijuana is a schedule-I controlled substance and is illegal under federal law. Even in those states in which the use of marijuana has been legalized, its use remains a violation of federal law. Since federal law criminalizing the use of marijuana preempts state laws that legalize its use, strict enforcement of federal law regarding marijuana would likely result in our inability to proceed with its business plan. (table of contents) Potential users of our proposed facility may have difficulty accessing the service of banks, which may make it difficult for them to operate. Since the use of marijuana is illegal under federal law, there is a compelling argument that banks cannot accept for deposit funds from businesses involved with marijuana. Consequently, businesses involved in the marijuana industry often have trouble finding a bank willing to accept their business. The inability to open bank accounts may make it difficult for potential tenants of our proposed facility to operate. The Company may not be able to secure bank financing on favorable terms, if at all due to the involvement of our company in the marijuana industry. Laws and regulations affecting the medical marijuana industry are constantly changing, which could detrimentally affect our proposed operations. Local, state and federal medical marijuana laws and regulations are broad in scope and subject to evolving interpretations, which could require us to incur substantial costs associated with compliance or alter its business plan. In addition, violations of these laws, or allegations of such violations, could disrupt our business and result in a material adverse effect on its operations. In addition, it is possible that regulations may be enacted in the future that will be directly applicable to our proposed business. We cannot predict the nature of any future laws, regulations, interpretations or applications, nor can we determine what effect additional governmental regulations or administrative policies and procedures, when and if promulgated, could have on its business. Potential competitors could duplicate our business model. There is no aspect of our business which is protected by patents, copyrights, trademarks, or trade names. As a result, potential competitors could duplicate our business model with little effort. We are dependent on its management and the loss of any of its officers could harm our business. Our future success depends largely upon the experience, skill, and contacts of our officers. The loss of the services of these officers may have a material adverse effect upon our business. Our president Daniel Gallagher and Director Mr. Geoffrey Thompson have no experience in the marijuana industry nor do they have any experience operating a public company. Disclosure requirements pertaining to penny stocks may reduce the level of trading activity in the market for our common stock and investors may find it difficult to sell their shares. Trades of our common stock will be subject to Rule 15g-9 of the Securities and Exchange Commission which rule imposes certain requirements on broker/dealers who sell securities subject to the rule to persons other than established customers and accredited investors. For transactions covered by the rule, brokers/dealers must make a special suitability determination for purchasers of the securities and receive the purchaser's written agreement to the transaction prior to sale. The Securities and Exchange Commission also has rules that regulate broker/dealer practices in connection with transactions in "penny stocks". Penny stocks generally are equity securities with a price of less than $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in that security is provided by the exchange or system). The penny stock rules require a broker/ dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document prepared by the Commission that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker/dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker/dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer's account. The bid and offer quotations, and the broker/dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer's confirmation. Our Articles of Incorporation authorize our Board of Directors to issue up to 10,000,000 shares of preferred stock. The provisions in the Articles of Incorporation relating to the preferred stock allow directors to issue preferred stock with multiple votes per share and dividend rights which would have priority over any dividends paid with respect to the holders of common stock. The issuance of preferred stock with these rights may make the removal of management difficult even if the removal would be considered beneficial to shareholders generally, and will have the effect of limiting shareholder participation in certain transactions such as mergers or tender offers if these transactions are not favored by management. We are deemed as a "shell company" under Rule 12b-2 of the Exchange Act. Resale of our shares is not permitted under Rule 144(i) until 12 months after the registrant is no longer considered a shell company. We are considered a shell company as defined by Rule 12b-2 of the Exchange Act. Rule 12b-2 defines a shell company as a registrant that has nominal operations and assets consisting solely of cash and cash equivalents and nominal other assets. Our shell company status prevents the resale of our shares under Rule 144(i) unless and until 12 months after we are no longer considered a shell company. We caution investors as to the highly illiquid nature of an investment in our shares. In addition, until our shell company status has been removed, we will be unable to register shares for issuance in equity compensation plans and agreements on Form S-8. (table of contents) FORWARD LOOKING STATEMENTS The statements contained in this prospectus that are not historical fact are forward-looking statements which can be identified by the use of forward-looking terminology such as "believes," "expects," "may," "should," or "anticipates" or the negative thereof
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+Prospectus Summary The following summary highlights selected material information contained in this prospectus. This summary does not contain all the information you should consider before investing in the securities. Before making an investment decision, you should read the entire prospectus carefully, including the "Risk Factors" section, the financial statements, and the notes to the financial statements. Our Company All references to "we," "us," "our," or similar terms used in this prospectus refer to Caleminder Inc. Our fiscal year ends on December 31. We were incorporated in the State of Delaware on May 28, 2014 and are a development stage company. Our company has developed a business plan for an online service that provides a calendar- based greeting and reminder service to assist subscribers in remembering important life events such as birthdays, anniversaries, etc. The Company operates out of Israel however the web application will be available worldwide . Users will register with the system and enter these important dates as well as configure a variety of settings, including how they want to be notified, for example by email or by text message or via Facebook or other social media tools; when they want to be notified, for example one month prior, two weeks prior, one week prior, etc. The user can also designate contacts as belonging to specific user groups such as Friends, Family, Professional Contact. These user groups will be customizable. The content of the reminder can also be customized so that the user can either enter all the relevant details, or leave the reminder cryptic so as not to alert others to the upcoming event. Many of the settings will be one-time preferences while other fields will need to be customized per reminder set. A series of reports will be made available to the end-user to indicate what reminders are pending, already sent, etc. Because the website will run entirely on the Cloud, end-users will not be required to download any application. The company plans to work with an outside web developer to create the programming, back office and infrastructure, as well as the look and feel of the website. We plan to work with marketing and social media experts to determine the best way to promote the site and brand our offering. We will also need to hire user interface experts to optimize the graphic user interface. We plan to monetize the site through several means including topic-based advertisement; local, national, global and corporate sponsors, and more. While the base service will be free to end-users, additional for-pay services will be added. These will include not only the reminder messages that are free, but the ability to configure automatic emails that will be sent on the day of the event birthday, anniversary, etc. to another person. We believe we can create an interface that will enable the end-user to customize many factors within the notification. We will offer the for-pay users the opportunity to upload a video or tape an audio message that will be attached to the email or included in a link. A full set of for-pay end-user benefits will need to be discussed with the development agency we hire. Some of the initially planned features may need to be shifted to later development cycles. Certain features of the proposed services may not be developed without proper funding . In the early stages, we plan to develop template-like options that enable a user to upload digital photographs, logos, etc. to customize templates that can be saved and reused when needed. Each template will be created via a Template Editor. Ideally, the Template Editor will have a graphic What You See Is What You Get interface that enables the user to drag and drop elements to customize the template. The user should be able to control the font, color and size of text, move graphics around, and more. At the same time, for users who feel that they are less creative, the Caleminder service should include some basic samples that can quickly be modified by adding a name, user address, and event title and quickly generate and send the appropriate card. We are currently a SHELL company and will need to raise $18,500 to commence operations . Our auditors have issued an audit opinion which includes a statement describing our going concern status. Our financial status creates substantial doubt as to whether we will be able to continue as a going concern. Investors should note that we have not generated any revenues to date, and that we do not yet have any services available for sale. The Company has no full time employees, and our officer intend to devote approximately twenty hours per week to the business activities of the Company. Our Direct Public Offering We are offering for sale up to a maximum of 2,500,000 Shares of our common stock directly to the public. There is no underwriter involved in this Offering. We are offering the Shares without any underwriting discounts or commissions. The purchase price is $0.02 per share. If all of the Shares offered by us are purchased, the gross proceeds before deducting expenses of the offering will be up to $50,000. The expenses associated with this offering are estimated to be $11,500 or approximately 23% of the gross proceeds of $50,000 if all the Shares offered by us are purchased. If all the Shares offered by us are not purchased, then the percentage of offering expenses to gross proceeds will be higher and a lower amount of proceeds will be realized from this offering. This is our initial public Offering, and no public market currently exists for Shares of our common stock. We can offer no assurance that an active trading market will ever develop for our common stock. The Offering will terminate 180 days after this Registration Statement is declared effective by the Securities and Exchange Commission. However, we may extend the Offering for up to 90 days following the six month Offering period. The Offering Total Shares of common stock outstanding prior to the Offering 7,500,000 Shares Shares of common stock being offered by us 2,500,000 Shares Total Shares of common stock outstanding after the Offering 10,000,000 Shares Gross proceeds: Gross proceeds from the sale of up to 2,500,000 Shares of our common stock will be up to $50,000. Use of proceeds from the sale of our Shares will be used as general operating capital towards the cost of launching our website and services, as well as identifying a marketing agency that is ideally matched to our needs, such that we are able to design, develop and market our services. We will also need to hire a web development agency and a user interface expert as well as ongoing social media experts to promote our calendar-based reminder service on an ongoing basis. Risk Factors There are substantial risk factors involved in investing in our Company. For a discussion of certain factors you should consider before buying Shares of our common stock, see the section entitled "Risk Factors." This is a self-underwritten public Offering, with no minimum purchase requirement. Shares will be offered on a best efforts basis, and we do not intend to use an underwriter for this Offering. We do not have an arrangement to place the proceeds from this Offering in an escrow, trust, or similar account. Any funds raised from the Offering will be immediately available to us for our immediate use. As used in this prospectus, references to the "Company," "we," "our," or "us" refer to Caleminder Inc., unless the context otherwise indicates. A Cautionary Note on Forward-Looking Statements This prospectus contains forward-looking statements which relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as may, should, expects, plans, anticipates, believes, estimates, predicts, potential, or continue or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled Risk Factors, that may cause our or our industry s actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by these forward-looking statements. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform to actual results. Selected Summary Financial Data This table summarizes our operating and balance sheet data as of the periods indicated. You should read this summary financial data in conjunction with the "Plan of Operations" and our financial statements and notes thereto included elsewhere in this prospectus. (May 28, 2014) Through (June 30 2014 ) Statement of Operations: Total revenues $— Total operating expenses $1,000 (Loss) from operations $(1,000) Net (loss) $(1,000) (Loss) per common share $(0.00) Weighted average number of common Shares outstanding - Basic and diluted 6,617,647 As of (June 30, 2014) Balance Sheet: Cash in bank $15,000 Prepaid Expenses $3,000 Total current assets $18,000 Total assets $18,000 Total current liabilities $18,250 Total liabilities $18,250 Total stockholders (deficit) $(250) Total liabilities and stockholders (deficit) $18,000 RISK FACTORS This investment has a high degree of risk. Before you invest, you should carefully consider the risks and uncertainties described below and the other information in this prospectus. If any of the following risks actually occur, our business, operating results and financial condition could be harmed and the value of our stock could go down. This means you could lose all or part of your investment. RISKS
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2014/CIK0001613859_pra_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/CIK0001613859_pra_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should read this entire prospectus carefully, including the matters discussed under the captions "Risk Factors," "Unaudited Pro Forma Consolidated Financial Statements" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and the related notes thereto appearing at the end of this prospectus, before making an investment decision. As used in this prospectus, unless the context otherwise requires, references to "PRA Health Sciences," "PRA," "the Company," "our company," "we," "us," and "our" refer to PRA Health Sciences, Inc. and its consolidated subsidiaries. Overview We are one of the world's leading global contract research organizations, or CROs, by revenue, providing outsourced clinical development services to the biotechnology and pharmaceutical industries. We believe we are one of a select group of CROs with the expertise and capability to conduct clinical trials across all major therapeutic areas on a global basis. We have therapeutic expertise in areas that are among the largest in pharmaceutical development, including oncology, central nervous system, inflammation and infectious diseases. We believe we provide our clients with one of the most flexible clinical development service offerings, which includes both traditional, project-based Phase I through Phase IV services as well as embedded and functional outsourcing services. We believe we further differentiate ourselves from our competitors through our investments in medical informatics and clinical technologies designed to enhance efficiencies, improve study predictability and provide better transparency for our clients throughout their clinical development processes. We are one of the largest CROs in the world by revenue, focused on executing clinical trials on a global basis. Our global clinical development platform includes more than 75 offices across North America, Europe, Asia, Latin America, South Africa, Australia and the Middle East and more than 10,000 employees worldwide. Since 2000, we have performed approximately 2,300 clinical trials worldwide. We have worked on more than 100 marketed drugs across several therapeutic areas and conducted the pivotal or supportive trials that led to U.S. Food and Drug Administration, or FDA, or international regulatory approval of more than 45 drugs. We are focused on further expansion into high growth, emerging markets, which is demonstrated by the formation of our 2012 joint venture with WuXi AppTec (Shanghai) Co. Ltd., or WuXi, a CRO managing clinical trials in Asia, and our 2013 acquisition of ClinStar, LLC, or ClinStar, a CRO managing clinical research trials in Eastern Europe. We believe we are a leader in the transformation of the CRO engagement model via our flexible clinical development service offerings, which include embedded and functional outsourcing services in addition to traditional, project-based clinical trial services. In September 2013, we completed the acquisition of ReSearch Pharmaceutical Services, or RPS, a global CRO providing clinical development services primarily to large pharmaceutical companies, which provides a highly complementary fit with our historical focus on biotechnology and small- to mid-sized pharmaceutical companies. RPS, now known as our Strategic Solutions offerings, provides Embedded Solutions and functional outsourcing services in which our teams are fully integrated within the client's internal clinical development operations and are responsible for managing functions across the entire breadth of the client's drug development pipeline. We believe that our Strategic Solutions offerings represent an innovative alternative to the traditional, project-based approach and allow our clients to maintain greater control over their clinical development processes. Our flexible clinical development service offerings expand our addressable market beyond the traditional outsourced clinical development market to include the clinical development spending that biopharmaceutical companies historically have retained in-house. AMENDMENT NO. 5 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 PRA and our logo are two of our trademarks that are used in this prospectus. This prospectus also includes trademarks, tradenames and service marks that are the property of third parties. Trademarks, tradenames and service marks referred to in this prospectus may or may not appear with the and symbols, but those references (or the lack thereof) are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable trademark law, our rights or that the applicable owner will not assert its rights to any such trademarks, tradenames and service marks. Table of Contents Over the past 30 years, we have developed strong client relationships and have performed services for more than 300 biotechnology and pharmaceutical clients. In the first nine months of 2014, we derived 19% of our service revenue from small- to mid-sized pharmaceutical companies, 27% of our service revenue from large biotechnology companies and 13% of our service revenue from emerging biotechnology companies. We believe that we have built a reputation as a strategic partner of choice for biotechnology and small- to mid-sized pharmaceutical companies as a result of our competitively differentiated platform and our long-term track record of serving these companies. We expect to benefit from growth in clinical development investment from these customers given the favorable capital raising environment in recent years. Our acquisition of RPS significantly expanded our relationships with large pharmaceutical companies, which represented 41% of our service revenue for the nine months ended September 30, 2014 and include all of the top 20 largest pharmaceutical companies. We believe we are well positioned to broaden our relationships and pursue strategic alliances with these large pharmaceutical companies due to our global presence, broad therapeutic expertise and flexible clinical development service offerings. Our Industry Industry Standard Research, or ISR, a market research firm, estimated in its "2014 CRO Market Size Projections" report that the size of the worldwide CRO market was approximately $22 billion in 2013 and will grow at an 8% compound annual growth rate, or CAGR, to $32 billion over the next five years. This growth will be driven by an increase in the amount of research and development, or R&D, expenditures and higher levels of clinical development outsourcing by biopharmaceutical companies. Increased R&D spending ISR estimates that R&D expenditures by biopharmaceutical companies was approximately $240 billion in 2013 and will grow at more than 2% per year over the next five years. Of this amount, approximately $99 billion was spent on development, including $70 billion on Phase I through IV clinical development. Growth drivers of R&D spending among biopharmaceutical companies include the need to replenish approximately $84 billion in lost revenues since 2012 resulting from the patent expirations of a large number of high-profile drugs and a robust capital raising environment among biotechnology companies in which over $26 billion has been raised in the first nine months of 2014. Higher outsourcing penetration ISR estimates that approximately 31% of Phase I through IV clinical development spend is outsourced to CROs, and that the level of penetration is expected to increase to approximately 43% by 2018. We believe this increase in outsourcing penetration is due to several factors, including the need to maximize R&D productivity, the increasing burden of clinical trial complexity, the desire to pursue simultaneous registration in multiple countries and strong growth in Phase II through Phase IV trials. Maximizing Productivity and Reducing Cost Productivity within the biopharmaceutical industry has declined over the past several years, while the cost of developing new drugs has increased significantly. We believe that the need for biopharmaceutical companies to maximize productivity and lower costs will cause them to look to CROs as partners that can improve efficiency and clinical success rates, and increase flexibility and speed across their clinical operations. Increasing Clinical Trial Complexity Over the last decade, the burden of clinical trial complexity has been increasingly difficult to manage due to requirements from regulatory authorities worldwide for greater amounts of clinical trial and safety data to support the approval of new drugs, and requirements for adherence to increasingly complex and diverse regulations and guidelines. To balance the conflicting demands of a growing market with the need to control R&D expenses, biopharmaceutical companies engage CROs to provide services designed to generate high quality and timely data in support of regulatory approvals of new drugs or the reformulations of existing drugs as well as support of post-approval regulatory requirements. PRA HEALTH SCIENCES, INC. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction of incorporation or organization) 8731 (Primary Standard Industrial Classification Code Number) 46-3640387 (I.R.S. Employer Identification No.) PRA Health Sciences, Inc. 4130 ParkLake Avenue Suite 400 Raleigh, NC 27612 (919) 786-8200 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Table of Contents Simultaneous Multi-Country Registration Given their desire to maximize efficiency and global market penetration to achieve higher potential returns on their R&D expenditures, biopharmaceutical companies are increasingly pursuing simultaneous, rather than sequential, regulatory new drug submissions and approvals in multiple countries. However, most biotechnology and small- to mid-sized pharmaceutical companies do not possess the capability or capacity to simultaneously conduct large-scale clinical trials in more than one country. Growth in Phase II through Phase IV Trials Biopharmaceutical companies are also devoting an increasing amount of resources to Phase II through IV trials. Complex late-stage trials, especially those in which sponsors seek to recruit patients with specific conditions on a global basis, are ideally suited for outsourcing to the select group of global CROs with expertise to execute these studies and access to industry leading investigators and trial sites globally. We believe the increase in the quantity and complexity of clinical trials exceeds the capacity and expertise of many biopharmaceutical companies, and is causing them to increasingly seek outsourced solutions. Our Competitive Strengths Global CRO platform We are one of the largest CROs in the world by revenue, focused on executing clinical trials on a global basis. We are dedicated to the seamless execution of integrated clinical trials on multiple continents concurrently. We believe our global presence and scale are important differentiators as biopharmaceutical companies are increasingly focused on greater patient access for increasingly complex clinical trials and gaining regulatory approval for new products in multiple jurisdictions simultaneously. Broad and flexible service offering We believe that we are one of a select group of CROs capable of providing both traditional, project-based CRO services as well as embedded and functional outsourcing services. Our broad and flexible service offering allows us to meet the clinical research needs of a wide range of clients, from small biotechnology companies to large pharmaceutical companies. Through more than 30 years of experience, we have developed significant expertise executing complex drug development projects that span Phase I through Phase IV clinical trials. Therapeutic expertise in large segments of drug development Our therapeutic expertise encompasses areas that are among the largest in pharmaceutical development, including oncology, central nervous system, inflammation and infectious diseases. We have participated in more than 950 clinical trials in these key areas since 2005, accounting for a substantial majority of our total clinical trials during this period. Innovative approach to clinical trials using medical informatics We are committed to being an industry leader in developing global, scalable and sustainable solutions for our clients. We have invested in and acquired large databases of aggregated patient medical data, which we refer to as medical informatics, to better understand patient distribution and location. Our medical informatics suite includes physician, hospital and pharmacy databases that cover more than 280 million patient lives and approximately 10 billion patient and pharmacy claims in the United States. We believe our proprietary analysis and application of this data are key differentiators and allow us to identify more productive investigative sites and speed up overall patient enrollment, thereby decreasing drug development timelines. Attractive and diversified client base Over the past 30 years, we have performed services for more than 300 biotechnology and pharmaceutical clients. We believe we are one of a select group of global, large scale CROs with a long-term track record serving biotechnology and small- to mid-sized pharmaceutical companies, and believe that these companies represent an attractive growth opportunity. In addition, our acquisition of RPS significantly expanded our relationships with large pharmaceutical companies, which currently include all of the top 20 largest pharmaceutical companies. Colin Shannon President and Chief Executive Officer PRA Health Sciences, Inc. 4130 ParkLake Avenue Suite 400 Raleigh, NC 27612 (919) 786-8200 (Name, address, including zip code, and telephone number, including area code, of agent for service) Table of Contents Innovative management team We are led by a dedicated and experienced executive management team that has an average of 20 years of experience across the global clinical research, pharmaceutical and life sciences industries. This team has been responsible for building our global platform, developing our advanced IT-enabled infrastructure and realizing our significant growth in revenue and earnings over the past five years. In addition, this team has been responsible for successfully integrating the RPS, CRI Lifetree and ClinStar acquisitions, as well as structuring and successfully executing our WuXi joint venture. Our Growth Strategy Leverage our strong market position within the biotechnology and small- to mid-sized pharmaceutical market We believe our long-term track record serving biotechnology and small- to mid-sized pharmaceutical companies has resulted in our earning a reputation as a strategic partner of choice for these companies. We intend to leverage our strong relationships with biotechnology and small- to mid-sized pharmaceutical companies to capture additional business from these companies. In particular we believe the CRO strategic alliances that have become prevalent with large pharmaceutical companies over the past several years will increasingly be utilized by biotechnology and small- to mid-sized pharmaceutical companies. We believe we are well positioned to take advantage of these opportunities. Build deeper and broader relationships with large pharmaceutical companies Large pharmaceutical companies have increasingly focused on partnering with multinational CROs that offer a wide array of global therapeutic and service capabilities. Our acquisition of RPS significantly increased the depth of our relationships with large pharmaceutical companies. We intend to expand these relationships beyond the Embedded Solutions provided through our Strategic Solutions offerings to include additional traditional, project-based clinical trial services. Expand our leading therapeutic expertise in existing and new areas We believe that our therapeutic expertise in all clinical phases of drug development is critical to the proper design and management of clinical trials and we intend to continue to capitalize on our strong market positions in several large therapeutic categories. We have established and will continue to refine our scientific and therapeutic business development initiatives, which link our organization to key clinical opinion leaders and medical informatics data to more effectively leverage therapeutic expertise throughout our client engagement. Specifically, we believe that oncology, central nervous system, inflammation and infectious diseases, which together represent the majority of all drug candidates currently in clinical development by biotechnology and pharmaceutical companies, will be significant drivers of our growth. Continue to realize financial synergies and strategic benefits from recent acquisitions We believe we will continue to realize financial synergies and strategic benefits from the acquisitions we have completed over the past two years, resulting in additional revenue growth and margin improvements. We have substantially completed the operational integration of these acquisitions, and are in the process of executing our strategy to eliminate redundancies in corporate and overhead functions and achieve cost efficiencies resulting from the scale of the combined business. We are also in the early stages of benefitting from revenue opportunities gained by cross-selling our full set of services to our existing and new customers. Pursue selective and complementary acquisition strategy We are a selectively acquisitive company focused on growing our core service offerings, therapeutic capabilities and geographic reach into areas of high market growth. We have acquired 16 companies since 1997 and have established programs to help us identify acquisition targets and integrate them successfully. Our acquisition strategy is driven by our comprehensive commitment to serve client needs and we are continuously assessing the market for potential opportunities. Copies to: Richard Fenyes, Esq. Simpson Thacher & Bartlett LLP 425 Lexington Avenue New York, NY 10017 Telephone: (212) 455-2000 Telecopy: (212) 455-2502 Marc Jaffe, Esq. Rachel Sheridan, Esq. Latham & Watkins LLP 885 3rd Avenue New York, NY 10022 Telephone: (212) 906-1200 Telecopy: (212) 751-4864 Table of Contents
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+Table of Contents13 SUMMARY OF FINANCIAL INFORMATION The following table sets forth summary financial information derived from our financial statements for the periods stated. The accompanying notes are an integral part of these financial statements and should be read in conjunction with the financial statements, related notes thereto and other financial information included elsewhere in this prospectus. We derived the balance sheet data and operating data for the years ended December 31, 2012and 2013 from our audited consolidated financial statements included elsewhere in this prospectus. The balance sheet data and operating data for the six months ended June 30, 2013 and 2014 have been derived from our unaudited financial statements included elsewhere in this prospectus. We have prepared the unaudited financial statements on the same basis as the audited consolidated financial statements and have included all adjustments, consisting only of normal recurring adjustments that, in our opinion, are necessary to state fairly the financial information set forth in those statements. Our historical results are not necessarily indicative of the results we expect in the future, and our interim results should not necessarily be considered indicative of results we expect for the full year or any other period. Balance Sheet Data: Year ended December 31, Six Months ended June 30 2012 2013 2014 Current assets $97 $91 $4,290 Total assets $97 $91 $4,290 Current liabilities $492 $1,675 $1,346 Total liabilities $492 $1,675 $1,346 Shareholders equity $(395) $(1,584) $2,944 Operating Data: From February 15, 2012 (inception) to For the year ending Six Months ended June 30, December 31, December 31, 2012 2013 2013 2014 Revenues — — — — Operating expenses $3,268 $8,027 $3,614 $11,313 Net loss $(3,268) $(8,027) $(3,614) $(11,313) Net loss per share per common share – basic and diluted $(0.00024) $(0.00023) $(0.00008) $(0.00015) Weighted average number of shares outstanding – basic and diluted 13,673,000 35,142,000 43,346,000 75,376,000 Table of Contents14 Important Information – No Required Minimum Amount of Shares Must be Sold There is no required minimum amount of Shares that must be sold in this offering. As a result, potential investors will not know how many Shares will ultimately be sold and the amount of proceeds we will receive from this offering. If we sell only a few Shares, potential investors may end up holding shares in a company that: has not received enough proceeds from the offering to start/sustain private equity operations; and has none, limited, volatile, and sporadic trading market for its common stock. This should be considered a substantial risk of investment, taken together with the "Risk Factors" section presented in this prospectus starting on page 16. Rule 419 – "Blank Check Company" We are not a "blank check company" as defined by Rule 419 of the Securities Act of 1933, as amended, and therefore the registration statement need not comply with the requirements of Rule 419. Rule 419 defines a "blank check company" as a company that: (1)is a development stage company that has no specific business plan or purpose or has indicated that its business plan is to engage in a merger or acquisition with an unidentified company or companies, or other entity or person; and (2)is issuing "penny stock," as defined in Rule 3a51-1 under the Securities Exchange Act of 1934. We have a very specific business purpose and a bona fide plan of operations. Our business plan and purpose is to conduct private equity investment activities at the community level. Under our community-anchored private equity business model, we intend to own and hold properties, assets and investments that result in profit to our shareholders, but at the same time revitalize the community and reward the employees. We intend to achieve this objective by (1) acquiring, rehabilitating and reutilizing dilapidated or abandoned properties; (2) acquiring and restructuring troubled businesses; (3) socially conscious venture capital activities; (4) opportunistic private equity activities; (5) job-creating and community-empowering investments; and (6) general business-process-improvement through partnerships, mergers and acquisitions, (re)capitalizations and investments. On August 1, 2012, to cultivate the goodwill of local small businesses in Los Angeles, and gain better understanding about the challenges, opportunities, and limitations facing small businesses in the area, we started providing free business advisory to small and medium businesses across the County. As of June 30, 2014, we have not generated any revenue, but we anticipate generating revenue within the twelve months from the date we close this offering, assuming we are able to place a sufficient amount of this offering. We have identified three Los Angeles based aftermarket auto parts retail businesses which we have determined to fit our investment/acquisition criteria which will cost $197,000, $429,000 and $299,000 respectively, for a total of $925,000 in acquisition capital. We could acquire them simultaneously or one-at-a-time basis. Upon receipt of adequate funding from this offering we intend to (i) acquire the three auto parts businesses, (ii) restructure the businesses and synchronize their operations, (iii) find more troubled businesses to buy and restructure, and (iv) use the remaining cash to grow the businesses. In addition to the three aftermarket auto parts retail businesses identified above, we have also identified more than thirty-seven other such businesses that are listed for sale, which we believe fit our investment and acquisition criteria. However, we have not conducted any due diligence or entered into negotiations with the sellers of the roughly thirty-seven businesses. Table of Contents15 Moreover, there can be no assurance that we will be able to raise the capital necessary to acquire, own or hold these investments or businesses: (a) we intend to finance the acquisitions of identified three aftermarket auto parts retail businesses with the proceeds from this offering; (b) we have no additional sources or commitments to finance such acquisitions; (c) there is no guarantee that we will be able to obtain sufficient financing to acquire these businesses; (d) we have not entered into any agreements to acquire these three businesses; (e) even if we are able to raise capital through this offering, we may not be able to acquire the three auto parts businesses if the sellers change their mind about selling to us since we have no contract with the seller requiring them to sell the businesses to us; and (f) there is no guarantee that the sellers would still be willing to sell to us. Because we have not entered into any agreements or contracts to acquire these three businesses and in light of the fact that we currently has no sources of financing and no commitments for financing that would enable us to acquire the three auto parts businesses, there is no assurance that we would be able to acquire the businesses or that the sellers would wait for us to raise the necessary capital for the acquisition. Lastly, at this time and immediately after this offering, we do not have any plans or intentions to engage in a merger or acquisition with an unidentified company or companies or other entity or person. In addition to the three aftermarket auto parts retail businesses identified above, we have also identified more than thirty-seven other such businesses that are listed for sale, which we believe fit our investment and acquisition criteria. However, we have not conducted any due diligence or entered into negotiations with the sellers of the roughly thirty-seven businesses. Moreover, there can be no assurance that we will be able to raise the capital necessary to acquire, own or hold these investments or businesses. Although many of these businesses are sold as soon as they are listed on mergernetwork.com, new one get listed every week, thus, identifying the good ones to buy would not be difficult. Table of Contents16
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+The items in the following summary are described in more detail later in this prospectus. This summary provides an overview of selected information and does not contain all of the information you should consider. Therefore, you should also read the more detailed information set out in this prospectus, including the risk factors, the financial statements and related notes thereto, and the other documents to which this prospectus refers before making an investment decision. Unless otherwise stated in this prospectus, references to MPG, the Company, we, our, us and similar terms refer to Metaldyne Performance Group Inc. and all of its subsidiaries, including HHI, Metaldyne and Grede and their respective direct and indirect subsidiaries. References to Metaldyne and Grede are for periods subsequent to their acquisitions by American Securities unless otherwise stated in this prospectus. See Certain Terms on page iii for certain industry terms used to describe our business. Overview We are a leading provider of highly-engineered components for use in Powertrain and Safety-Critical Platforms for the global light, commercial and industrial vehicle markets. We produce these components using complex metal-forming manufacturing technologies and processes for a global customer base of vehicle OEMs and Tier I suppliers. Our components help OEMs meet fuel economy, performance and safety standards. Given these increasingly stringent standards, components for Powertrain and Safety-Critical Platforms are among the largest and fastest growing dollar content categories within a vehicle. At least one of our components was found in approximately 90% of the 16.2 million light vehicles built in North America during 2013. Furthermore, our components were found on over 60% of the top 20 engine and transmission Platform total units produced in North America and Europe during 2013. Our metal-forming manufacturing technologies and processes include Aluminum Die Casting, Forging, Iron Casting and Powder Metal Forming as well as Advanced Machining and Assembly. These technologies and processes are used to create a wide range of customized Powertrain and Safety-Critical components that address requirements for power density (increased component strength to weight ratio), power generation, power / torque transfer, strength and NVH. For 2013, we generated on a pro forma basis: Net sales of $3.05 billion; Adjusted EBITDA of $508.8 million, or 17% of net sales; Net income of $66.5 million; and Adjusted EBITDA less capital expenditures, which we refer to as Adjusted Free Cash Flow, of $347.1 million. Our net sales, Adjusted EBITDA, net income and Adjusted Free Cash Flow were $2.0 billion, $363.1 million, $57.9 million and $240.8 million, respectively, for 2013. We define, reconcile and explain the importance of Adjusted EBITDA and Adjusted Free Cash Flow, non-GAAP financial measures, in Summary Historical Financial and Other Data. In addition, see Unaudited Pro Forma Financial Data for additional information about our pro forma adjustments, including the impact of the Grede acquisition. Table of Contents The information in this preliminary prospectus is not complete and may be changed. The selling stockholder may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to Completion Preliminary Prospectus dated December 4, 2014 PROSPECTUS 15,384,615 Shares Metaldyne Performance Group Inc. Common Stock This is the initial public offering of Metaldyne Performance Group Inc. The selling stockholder identified in this prospectus is selling all of the shares of our common stock in this offering. We will not receive any proceeds from the sale of shares to be offered in this offering. We expect the public offering price to be between $18.00 and $21.00 per share. Currently, no public market exists for the shares. After pricing the offering, we expect that the shares will trade on the New York Stock Exchange under the symbol MPG. Investing in the common stock involves risks that are described in the Risk Factors section beginning on page 23 of this prospectus. Per Share Total Public offering price $ $ Underwriting discount (1) $ $ Proceeds, before expenses, to the selling stockholder $ $ (1) The underwriters will receive compensation in addition to the underwriting discount. See Underwriting. The underwriters may also exercise their option to purchase up to an additional 2,307,692 shares from the selling stockholder, at the public offering price, less the underwriting discount, for 30 days after the date of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The shares will be ready for delivery on or about , 2014. BofA Merrill Lynch Goldman, Sachs & Co. Deutsche Bank Securities Barclays Credit Suisse RBC Capital Markets Baird KeyBanc Capital Markets Nomura The date of this prospectus is , 2014. Table of Contents This prospectus presents HHI as the predecessor to MPG. HHI was acquired by a wholly-owned subsidiary of certain private equity funds affiliated with American Securities LLC (together with its affiliates, American Securities ) and certain members of HHI management on October 5, 2012. Metaldyne was acquired by American Securities and certain members of Metaldyne management on December 18, 2012. The period from January 1, 2011 to October 5, 2012 is referred to as the Predecessor Period and the period from October 6, 2012 to September 28, 2014 is referred to as the Successor Period. The period from October 6, 2012 to December 31, 2012 is referred to as Successor Period 2012 and the period from January 1, 2012 to October 5, 2012 is referred to as Predecessor Period 2012. Grede was acquired by a wholly-owned subsidiary of American Securities and certain members of Grede management on June 2, 2014. The following timeline illustrates the periods for which financial information for HHI, Metaldyne and Grede are included in this prospectus. This prospectus includes: audited consolidated balance sheets of MPG as of December 31, 2013 and 2012 and audited consolidated statements of operations, comprehensive income (loss), stockholders equity (deficit) and cash flows of MPG for the year ended December 31, 2013, the periods from October 6, 2012 to December 31, 2012 and for MPG s predecessor from January 1, 2012 to October 5, 2012 and the year ended December 31, 2011; unaudited condensed consolidated balance sheets of MPG as of September 28, 2014 and December 31, 2013 and unaudited condensed consolidated statements of operations, comprehensive income (loss), stockholders equity (deficit) and cash flows of MPG for the nine month periods ended September 28, 2014 and September 29, 2013; in accordance with Rule 3-05 of Regulation S-X, audited consolidated statements of operations, comprehensive income, stockholders equity (deficit) and cash flows of MD Investors Corporation, Metaldyne s subsidiary, for the 352-day period ended December 17, 2012 and for the year ended December 31, 2011; in accordance with Rule 3-05 of Regulation S-X, Grede Holdings LLC s audited consolidated statements of financial position as of December 29, 2013 and December 30, 2012 and audited consolidated statements of operations, comprehensive income, members equity (deficit) and cash flows for the years ended December 29, 2013, December 30, 2012 and January 1, 2012; unaudited condensed consolidated statements of financial position and members equity (deficit) of Grede Holdings LLC, Grede s subsidiary, as of March 30, 2014 and December 29, 2013 and unaudited condensed consolidated statements of operations, comprehensive income and cash flows of Grede Holdings LLC for the three month periods ended March 30, 2014 and March 31, 2013; and Table of Contents The charts below highlight our pro forma net sales for the year ended December 31, 2013 by segments, vehicle applications and end-markets. Segments Vehicle Applications End-Markets Our portfolio of manufacturing capabilities in 11 countries provides us with a flexible and close-to-customer manufacturing footprint that would be difficult to replicate. We believe the magnitude of the investment and the length of time required to open facilities, acquire equipment and navigate environmental permitting processes provide significant economic and practical barriers to entry for new competitors. We believe additional barriers are created by the broad engineering, technical and manufacturing know-how within our global employee base and our demonstrated ability to produce our components within our customers stringent performance and delivery requirements. Moreover, during 2008 and 2009, a significant amount of the automotive Forging capacity was removed from the North American market. In addition, according to The American Foundry Society, an estimated 1 million tons, representing over 10% of iron casting capacity and 36 iron metal casters, exited the North American market from 2007 to 2010. We believe the reduced industry capacity provides us with growth opportunities given our relevant expertise and existing footprint. The following table provides a summary of our pro forma net sales for the year ended December 31, 2013 by metal-forming manufacturing technologies and value-added processes and their representative applications. Portfolio of Manufacturing Technologies and Value-Added Processes Vehicle Applications 2013 Pro Forma Net Sales (In millions) Advanced Machining and Assembly Improving form, finish and function of components, and the assembly of multiple components into a ready-to-install module Engine, Driveline, Transmission, Brake, Chassis and Suspension $ 600 Aluminum Die Casting Injecting molten aluminum under pressure into a solid mold Transmission $ 60 Cold and Warm Forging and Related Machining Forging at room temperature and below 950 degrees Celsius, respectively Engine, Driveline, Transmission $ 306 Ductile Iron Casting and Related Machining Pouring molten ductile iron into a mold to produce components Driveline, Brake, Chassis and Suspension $ 841 Grey Iron Casting and Related Machining Pouring molten grey iron into a mold to produce components Engine, Driveline, Transmission $ 148 Hot Forging and Related Machining Forging at temperatures above 1,200 degrees Celsius Engine, Driveline, Transmission, Brake, Chassis and Suspension $ 474 Powder Metal Forming and Related Machining Compacting metal powder in a mold, followed by heating the shaped component to just below the metal powder s melting point to form complex Net Formed components Engine, Driveline, Transmission $ 429 Rubber and Viscous Dampening Assemblies Advanced rubber-to-metal bonded or silicone filled assemblies that reduce, restrict or prevent oscillations, torsion and bending in vehicle engines Engine $ 195 Table of Contents Table of Contents pro forma financial information as of September 28, 2014 and for the nine months ended September 28, 2014 and the year ended December 31, 2013 after giving effect to the Grede Transaction, the Combination, the Refinancing (the Grede Transaction and the Refinancing as defined in Summary Company Organization and History ), the elimination of certain sponsor management fees and this offering. We operate on a 13 week fiscal quarter which ends on the Sunday nearest to March 31, June 30 or September 30, as applicable. Our fiscal year ends on December 31. Further, prior to the Grede Transaction, Grede operated on a 52 or 53 week fiscal year which ends on the Sunday nearest to December 31. After the Grede Transaction, Grede s fiscal year end will conform to our fiscal year end. Certain Terms We use the following industry terms in describing our business in this prospectus: Advanced Machining and Assembly: Value-added precision machining to improve form, finish and function of components, and the assembly of multiple components into a ready-to-install module. Aluminum Die Casting: A casting process where molten aluminum is injected under pressure into a solid mold to create a complex formed component. Forging: The shaping of metal by a number of processes, including pressing and forming, typically classified according to temperature (cold, warm or hot). Iron Casting: A manufacturing process by which molten iron (ductile or grey) is poured into a mold to produce components with complex dimensions. Net Formed: A manufacturing technique which allows production of the component at or very close to the final (net) shape, reducing or eliminating scrap material and the need for surface finishing. NVH: The noise, vibration and harshness characteristics of vehicles, particularly cars and trucks, which vehicle design engineers seek to reduce. OEMs: Original equipment manufacturers. Powder Metal Forming: The process of compacting metal powder in a mold, followed by heating the shaped component to just below the metal powder s melting point to form complex Net Formed components. Powertrain: Components of the vehicle that generate power and transfer it to the road surface, typically including the engine, transmission and driveline. Rubber and Viscous Dampening Assemblies: Advanced rubber-to-metal bonded or silicone filled assemblies that reduce, restrict or prevent oscillations, torsion and bending in vehicle engines, thereby improving NVH characteristics. Safety-Critical: Components that assist in the control and stability of a vehicle in motion and are fundamental to performance and safety. These components typically include chassis, suspension, steering and brake components. Tier I suppliers: Suppliers of components and assemblies that are sold directly to OEMs. Table of Contents Our geographic and direct customer mix based on pro forma net sales for the year ended December 31, 2013 are highlighted in the charts below. Geography Direct Customer We have strong and longstanding relationships with our customers; the relationships with our top five customers average more than 15 years. Once embedded in a Program, our products are difficult to displace due to the high costs and long lead times associated with re-engineering and revalidation, tooling development, and the use of sophisticated materials in an exacting manufacturing process. We are the sole-sourced provider for substantially all products that we manufacture for a Program, and we typically supply our customers for the life of the Program, which can exceed 10 years. This provides us with significant revenue visibility. Our Industry We primarily serve the 84.7 million unit global light vehicle and the approximately 728,000 unit North American commercial and industrial vehicle and equipment end-markets with a focus on components for Powertrain and Safety-Critical applications. Demand in these end-markets, and therefore, our products, is driven by consumer preferences, regulatory requirements (particularly related to fuel economy and safety standards) and macro-economic factors. Powertrain: Consists of the engine, transmission and driveline categories of the vehicle which generate, manage and transfer power / torque from the engine to the road s surface. OEMs continue to focus on improving fuel efficiency and reducing emissions in order to meet consumer preferences and increasingly stringent regulatory requirements. As a result, OEMs and suppliers are developing products in an effort to significantly improve vehicle performance to meet these standards. Safety-Critical: Consists of categories such as chassis, suspension, steering and brake components. OEMs continue to focus on improving occupant safety in order to meet consumer preferences and increasingly stringent safety-related regulatory requirements. As a result, suppliers are developing stronger, higher performing content for OEMs that may be mandated by government regulators or added voluntarily to differentiate a vehicle from its competitors. We anticipate that the following emerging trends in the global end-markets for these components will create growth and opportunity for suppliers. Table of Contents We use the following industry terms in this prospectus to describe our products and how they are organized and sourced in our industry: Platform: A shared set of common design, engineering, and production efforts over a number of Vehicle Nameplates or Powertrains with common architecture (e.g. BMW NGB, Ford Duratec35). Program: Manufacturing and development of certain automobile components including engines, transmissions and brake components (e.g. BMW B38 A15, Ford 6R80W). Vehicle Nameplate: A specific vehicle model built within a Platform for a vehicle OEM (e.g. BMW 335i, Ford F-150). Illustrative examples of these terms are set forth below: Trademarks and Trade Names We own or have the rights to use various trademarks, service marks and trade names referred to in this prospectus. Solely for convenience, we refer to trademarks, service marks and trade names in this prospectus without the , SM and symbols. Such references are not intended to indicate, in any way, that we will not assert, to the fullest extent permitted by law, our rights to our trademarks, service marks and trade names. Other trademarks, trade names or service marks appearing in this prospectus are the property of their respective owners. Market and Industry Information Market and industry data used throughout this prospectus, including information relating to our relative position in the vehicle components industry, is based on the good faith estimates of our management, which in turn are based upon our management s review of internal surveys, surveys commissioned by us, independent industry surveys and publications and other publicly available information prepared by third parties, including publicly available information prepared by IHS Inc. ( IHS ), Americas Commercial Transportation Research ( ACT Research ), Yengst Associates, LMC Automotive US, Inc. ( LMC Automotive ), FTR Transportation Intelligence ( FTR ), International Council on Clean Transportation (Washington, DC) ( ICCT ), McKinsey & Company ( McKinsey ) and The American Foundry Society. All of the market data and industry information used in this prospectus involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. Although we believe that these sources are reliable, neither we nor the underwriters have independently verified this information. While we believe the estimated market position, market opportunity and market size information included in this prospectus is generally reliable, such information, which in part is derived from management s estimates and beliefs, is inherently uncertain and imprecise. Projections, assumptions and estimates of our future performance and the future performance of the industry in which we operate are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in Risk Factors, Forward-Looking Statements and elsewhere in this prospectus. These and other factors could cause results to differ materially from those expressed in our estimates and beliefs and in the estimates prepared by independent parties. Table of Contents Growth in Vehicle End-Markets The table below illustrates historical and projected light vehicle production. Units Total Growth 2013A 2016E Units % (In millions) Global Light Vehicle 84.7 93.7 9.0 10.6 North American Light Vehicle 16.2 17.9 1.7 10.7 Europe Light Vehicle 19.5 20.8 1.3 6.5 Asia Light Vehicle 43.0 48.8 5.8 13.5 Source: IHS as of November 2014. The table below illustrates historical and projected commercial vehicle, construction equipment and agricultural equipment production. Units Total Growth 2013A 2016E Units % (In thousands) North American Commercial Vehicle Medium and Heavy Duty Trucks 444.0 498.8 54.8 12.3 North American Construction Equipment 179.2 240.6 61.4 34.3 North American Agricultural Equipment 105.0 133.5 28.5 27.1 Source: Yengst Associates as of November 2014. ACT Research and FTR as of November 2014. As shown above, each of the major global light vehicle markets and the North American commercial vehicle and construction and agricultural equipment markets we serve is forecasted to increase total units sold through 2016. Trends Enhancing Demand for Powertrain and Safety-Critical Components Demand for vehicle components is a function of the number of vehicles produced and trends in content per vehicle for specific component categories. These variables are driven by consumer preferences and regulatory requirements, particularly related to fuel economy and safety standards. OEMs continue to source vehicle components that improve fuel economy and safety in order to meet increasingly stringent regulatory requirements around the world. In particular, the cost of failure in Powertrain and Safety-Critical applications is very high relative to the underlying component costs, and customers seek proven and reliable Powertrain and Safety-Critical component suppliers. McKinsey forecasts that Powertrain and Safety-Critical applications will account for 68% of total growth in component costs between 2010 and 2020. To meet global emission requirements, OEMs utilize a variety of strategies, including increasing energy efficiency, changing engine and transmission types, using lighter weight materials, electrification and improved aerodynamics. For example, LMC Automotive forecasts increased production of light vehicles will create demand for more efficient engines and higher speed transmissions for use in North America. Vehicle safety regulations continue to tighten, resulting in increased demand for high quality and high strength components for Safety-Critical applications such as brake components, steering knuckles and control arms. These components must be able to bend or twist without breaking while remaining cost competitive. We believe these trends provide growth opportunities for Powertrain and Safety-Critical component suppliers. Table of Contents Favorable Supply and Demand Dynamics During 2008 and 2009, a significant amount of the automotive Forging capacity was removed from the North American market. According to The American Foundry Society, an estimated 1 million tons, representing over 10% of iron casting capacity and 36 iron metal casters, exited the North American market from 2007 to 2010. In addition, the number of automotive components suppliers for Powertrain and Safety-Critical systems declined significantly during 2008 and 2009. The magnitude of the investment and the length of time required to open facilities, acquire equipment and navigate environmental permitting processes provide significant economic and practical barriers to entry for new competitors. Additionally, in other process technology categories such as Powder Metal Forming, we believe that while capacity has not changed materially, demand and the number of vehicle applications has increased substantially. Powder Metal Forming technology is being utilized in a higher number of Powertrain applications due to its Net Formed capabilities, which significantly reduces waste compared to other technologies. These supply and demand dynamics are expected to continue to provide growth opportunities for those companies with existing asset bases, technical know-how, global footprints and relevant metal-forming expertise. Consolidation of Global Platforms and Localization of Sourcing by OEMs Light vehicle OEMs are increasingly consolidating vehicle engine and transmission designs across Platforms with localized sourcing to improve supply chain efficiency, reduce unit cost and increase profitability. In engine and transmission, OEMs differentiate on the basis of power and torque delivery, overall performance, reliability and fuel economy. OEMs have reduced their engine architectures globally into high volume engine families because these differentiating attributes require significant investment and many years of research and development. These engine families are now utilized across an increasing number of Vehicle Nameplates and are typically used for seven years or longer. OEMs require suppliers to have robust engineering and product development expertise to optimize performance, profitability and overall cost. Furthermore, given the need to adapt to variations in regional markets and mitigate transportation and production risks, OEMs seek suppliers with manufacturing and product launch expertise near OEM locations. Our Competitive Strengths We believe we benefit from the following competitive strengths: Market Leader with a Broad Portfolio of Metal-Forming Manufacturing Technologies and Processes We are a leading provider of highly-engineered components used in Powertrain and Safety-Critical Platforms for the global light vehicle, commercial and industrial vehicle markets. We generated approximately 44% of our pro forma net sales in the growing engine and transmission categories. Our broad portfolio of metal-forming manufacturing technologies and process expertise is used in a wide range of highly-engineered and complex components, including engine connecting rods, balance shaft modules, turbo-charger housings; transmission gears, shafts and valve bodies; brake components; and wheel and axle components. At least one of our components was found on approximately 90% of the 16.2 million light vehicles built in North America in 2013, including all of the top 20 selling Platforms. Furthermore, our components were found on over 60% of the top 20 engine and transmission Platform total units produced in North America and Europe during 2013. Focus on High Growth Product Categories We provide a diverse range of metal-formed components used in key vehicle applications where power generation, power / torque transfer, strength and NVH are essential to performance, fuel economy and safety. Our broad product portfolio focuses on Powertrain and Safety-Critical applications, components which are Table of Contents among the largest and fastest growing dollar content categories within the vehicle. These product categories are expected to continue to grow in excess of broader vehicle production volume due to OEMs use of advanced engine and transmission technologies to meet increasingly stringent fuel economy and safety regulations. We believe we are well positioned to drive profitable sales growth by leveraging our core technologies, proven processes and strong customer relationships to capitalize on the positive secular and global market trends impacting Powertrain and Safety-Critical applications. Difficult to Replicate Global Manufacturing Footprint Our broad portfolio of global manufacturing assets provides us with a flexible and close-to-customer footprint that is difficult to replicate and creates substantial barriers to entry. Furthermore, our sophisticated engineering, technical and manufacturing teams bring decades of product and operations know-how to efficiently manufacture our products within the demanding performance and delivery requirements of our customers. Our worldwide manufacturing base includes 56 production facilities in 11 countries. Our broad portfolio of Advanced Machining and Assembly, Aluminum Die Casting, Forging, Iron Casting and Powder Metal Forming facilities gives us flexibility to produce complex, highly-engineered products on either a high or low volume basis. Diversified and Long-Term Blue-Chip Customer Base We have strong and longstanding relationships with leading global OEMs and Tier I suppliers, including Ford Motor Company ( Ford ), General Motors Company ( General Motors ), ZF Friedrichshafen AG ( ZF ), Toyota Motor Company ( Toyota ), Deere & Company ( Deere ) and Daimler Trucks North America LLC ( Daimler Trucks ). Our relationships with our five largest customers average more than 15 years. We believe these long-tenured relationships are the result of our ability to align with our customers to help them meet the industry s increasingly stringent fuel economy, performance and safety standards. We are the sole-sourced provider for substantially all products we manufacture for a Program, and we typically supply our customers for the life of the Program, which can exceed 10 years. This provides us with significant revenue visibility. Once embedded in a Program, our products are difficult for competitors to displace due to the high costs and long lead times associated with re-engineering and revalidation, tooling development and the use of sophisticated materials in an exacting manufacturing process. Technology and Manufacturing Leadership with Advanced Engineering and Demonstrated Launch Capabilities We develop high quality, cost-effective solutions through our process expertise and our collaborative working relationships with our customers. In 2013, we successfully launched over 490 customized products for our customers across our global manufacturing base in 11 countries. Our launches and product and process development are supported by over 400 degreed engineers that use leading edge Computer Aided Design ( CAD ), Finite Element Analysis ( FEA ) and modeling and simulation tools to provide the design capabilities required by our customers. In addition to our core engineering talent, the success of our global product development and launch capability is supported by our entire workforce. Culture of Continuous Improvement We are committed to continuous improvement across our global operations and seek to generate ongoing efficiencies and cost savings while adhering to high standards of quality, safety and environmental compliance. Our manufacturing disciplines have a high level of conformity across sites, with a focus on sharing best practices, setting and measuring goals and monitoring key production indicators. Our culture of continuous improvement allows for product and process improvements throughout all of our operations, which have historically generated significant cost savings and increased efficiencies. Table of Contents This culture of continuous improvement has led to our customers recognition of our technical capabilities, on-time delivery and quality performance. Over the past three years, we have received over 50 awards, and recently, Metaldyne received the 2013 GM Supplier of the Year Powertrain Division Award, HHI received the 2013 Toyota Excellent Quality Performance Award and Grede received the 2013 Honda Excellence in Quality Award. Strong Financial Profile with Focus on Cash Flow Generation In 2013, we generated pro forma Adjusted EBITDA margin of 17% and pro forma Adjusted Free Cash Flow of $347.1 million. Our Adjusted EBITDA margin was 18% and our Adjusted Free Cash Flow was $240.8 million in 2013. Our attractive financial performance with strong cash flow generation is a result of our: focus on Powertrain and Safety-Critical applications; flexible, highly-variable cost structure; culture of continuous improvement; and disciplined capital investment philosophy. We seek volume and pricing terms in our customer contracts based on generating sustainably attractive returns on invested capital and strong margins. We consistently evaluate our business portfolio and prioritize capital investment to optimize margins and overall returns. Experienced and Entrepreneurial Management Team Our management consists of an accomplished team with a history of generating attractive returns, accelerating growth, implementing operational productivity improvement plans and integrating businesses. Our senior leadership team is comprised of four executives who have over 110 years of combined relevant industry experience, and have established an entrepreneurial spirit and accountability throughout our company. Our senior leadership along with several levels of our management team has successfully led the identification, due diligence and integration of 15 strategic acquisitions over the past 10 years to support our global growth, further develop core competencies and expand manufacturing capabilities. Our management team also has extensive experience revitalizing businesses through cost management, plant rationalization and focusing product portfolios to improve revenues, expand margins and diversify end-markets and geographical presence. We have historically increased margins, cash flow and liquidity under the leadership of our management team. Our Strategy Our goal is to enhance our position as an industry leader in complex metal-formed components in Powertrain and Safety-Critical applications. The key elements of our strategy to achieve our goal are: Capture Expected Growth in Powertrain and Safety-Critical Components We will continue to develop customized and innovative products, technologies and processes to assist OEMs to meet increasingly stringent fuel efficiency, safety and performance standards. We believe our strong capabilities in metal-forming manufacturing technologies and value-added processes, highly trained personnel and broad portfolio of manufacturing assets will enable us to capture expected growth in Powertrain and Safety-Critical components, which are experiencing growth in excess of vehicle production volumes due to the trends in fuel economy and safety regulations. Table of Contents Deliver Strong Profitability and Cash Flow Generation We intend to maintain our financial discipline, and are focused on future Adjusted EBITDA growth, cash flow generation and return on invested capital. This culture is supported by our highly-variable cost structure and flexible capacity enabling us to manage our operations and costs to meet changing market conditions. We maintain raw material price pass-through arrangements with customers on substantially all of our products to reduce our exposure to raw material price fluctuations. We will continue to employ a disciplined approach to capital investment, focusing on projects with the most attractive rates of return. We believe our approach to new business opportunities, flexibility, highly-variable cost structure, culture of continuous improvement and disciplined capital investment philosophy positions us for strong growth, improved efficiencies and attractive margins in the future. Capitalize on Global Scale and Capabilities We will continue to support our global OEM and Tier I supplier customers with our close-to-customer footprint, global engineering and product launch capabilities. OEMs are increasingly standardizing engine and transmission designs to facilitate sharing across multiple Platforms and in some cases across different geographic regions. Our global customer base and manufacturing footprint also diversifies our revenue across various end-markets, geographies and industry cycles. We plan to continue to build our presence outside of North America, particularly in China, Mexico and Eastern Europe, where we have existing operations and are experiencing increased customer demand. Take Advantage of Cross-Sell and Other Opportunities We intend to cross-sell products and optimize capacity across our consolidated portfolio. As more of our customers adopt external value-added strategies, we believe that we are well positioned to capture this additional growth. We believe that we will continue to generate additional revenue and increase our value-added content by applying our core technologies and processes across our combined product offerings. We intend to leverage our combined manufacturing footprint across four continents and our technical and commercial centers in North America, Europe and Asia. For example, HHI s hot Forging product offerings are primarily located in North America. With Metaldyne s global footprint and in-country know-how, we believe we can expand HHI s product offering globally and capture additional market opportunities that were unavailable to HHI on a stand-alone basis. Further, Grede s strong customer relationships outside of the light vehicle market provide HHI and Metaldyne access to blue-chip industrial equipment and heavy truck customers such as Deere, Caterpillar Inc. ( Caterpillar ) and Daimler Trucks (Freightliner, Western Star). In addition, through a coordinated approach on new Program opportunities and by accessing our broad portfolio of manufacturing technologies, customer relationships, global footprint and engineering expertise, we believe we will win incremental new business. We also expect to realize savings by pursuing selective vertical integration opportunities, taking advantage of our increased scale and certain cost synergy initiatives. Pursue Selected Acquisitions and Strategic Alliances We intend to opportunistically leverage our experience in identifying, acquiring and integrating acquisitions that allow us to grow globally, enhance our product portfolio and technologies, further diversify our customer base and generate synergies. While we have no present commitments or agreements to enter into any such acquisitions, we believe there are numerous attractive opportunities given the large number of complementary businesses in the industry, further supplier consolidation trends and a large number of private equity owned companies in the industry. We may also seek strategic alliances which allow us to pursue new opportunities with greater flexibility and lower capital at risk as well as provide us with access to new technologies, products and markets. Table of Contents Company Organization and History The reorganization of HHI, Metaldyne and Grede occurred on August 4, 2014 through the mergers of three separate wholly-owned merger subsidiaries of MPG. A brief summary of the history of each of HHI, Metaldyne and Grede follows: HHI was formed in 2005 and, from 2005 through 2009, completed the strategic acquisitions of Impact Forge Group, LLC and Cloyes Gear and Products, Inc. and, following a 363 U.S. Bankruptcy Court supervised sale process, acquired certain assets and assumed specified liabilities from FormTech LLC, Jernberg Holdings, LLC and Delphi Automotive PLC s wheel bearing operations. HHI was acquired by American Securities and certain members of HHI management on October 5, 2012 (the HHI Transaction ). Metaldyne was formed in 2009 as a new entity to acquire certain assets and assume specified liabilities from the former Metaldyne Corporation ( Oldco M Corporation ) following a 363 U.S. Bankruptcy Court supervised sale process. Oldco M Corporation was previously formed when MascoTech, Inc., a then-publicly traded company, was taken private and acquired Simpson Industries, Inc., another then-public company. Metaldyne was acquired by American Securities and certain members of Metaldyne management on December 18, 2012 (the Metaldyne Transaction ). Grede was formed in 2010 through a combination of the assets of the former Grede Foundries, Inc. and Citation Corporation, following a 363 U.S. Bankruptcy Court supervised sale process. Subsequently, Grede acquired Foseco-Morval Inc., GTL Precision Patterns Inc., Paxton-Mitchell Corporation, Virginia Castings Industries LLC, Teknik, S.A. de C.V. and Novocast, S.A. de C.V. and established a global alliance with Georg Fischer Automotive AG (Europe / China). Grede was acquired by American Securities and certain members of Grede management on June 2, 2014 (the Grede Transaction ). The following chart illustrates our simplified ownership structure after the Combination and immediately prior to this offering: Table of Contents The Refinancing On October 20, 2014, MPG Holdco I Inc., our wholly owned subsidiary ( MPG Holdco ), entered into a senior secured credit facility (the Senior Credit Facilities ) in the aggregate amount of $1,600.0 million. The Senior Credit Facilities provide for (i) a seven-year $1,350.0 million term loan facility (the Term Loan Facility ) and (ii) a five-year $250.0 million revolving credit facility (the Revolving Credit Facility ). The Senior Credit Facilities are guaranteed by MPG and substantially all of our existing and future domestic restricted subsidiaries and are secured by substantially all of our and the guarantors assets on a first lien basis, subject, in each case, to certain limitations. On October 20, 2014, MPG Holdco also entered into an indenture pursuant to which it issued $600.0 million aggregate principal amount of its 7.375% Senior Notes due 2022 (the Senior Notes ). The Senior Notes rank pari passu in right of payment with the Senior Credit Facilities, but are effectively subordinated to the Senior Credit Facilities to the extent of the value of the assets securing such indebtedness. For further information on the Senior Credit Facilities, see Description of Other Indebtedness Senior Credit Facilities. The net proceeds of the Senior Notes and the borrowings under the Senior Credit Facilities, together with cash on hand, were used to prepay all amounts outstanding under each of HHI, Metaldyne and Grede s existing senior secured credit facilities as described below: HHI s senior secured credit facility consisting of (i) term loans in an original aggregate principal amount of $735.0 million ( HHI Term Loans ) and (ii) a $75.0 million revolving credit facility ( HHI Revolver and together with the HHI Term Loans, the HHI Credit Facilities ); Metaldyne s senior secured credit facility consisting of (i) a U.S. dollar term loan in an original aggregate principal amount of $537.0 million, (ii) a Euro denominated term loan in an original aggregate principal amount of 100.0 million ( Metaldyne Term Loans ) and (iii) a $75.0 million revolving credit facility ( Metaldyne Revolver and together with the Metaldyne Term Loans, the Metaldyne Credit Facilities ); and Grede s senior secured credit facility consisting of (i) term loans in an original aggregate principal amount of $600.0 million ( Grede Term Loans ) and (ii) a $75.0 million revolving credit facility ( Grede Revolver and together with the Grede Term Loans, the Grede Credit Facilities ). We refer to the HHI Credit Facilities, the Metaldyne Credit Facilities and the Grede Credit Facilities as the existing senior secured credit facilities. Collectively, we refer to the refinancing transactions described above and the payment of fees and expenses related to the foregoing as the Refinancing in this prospectus. Our Principal Stockholders Immediately following the closing of this offering, American Securities is expected to own approximately 72.7% of our outstanding common stock, or 69.2% if the underwriters exercise their option to purchase additional shares in full from the selling stockholder. As a result, American Securities will be able to exert significant voting influence over fundamental and significant corporate matters and transactions. See Risk Factors Risks Related to Our Company and Our Organizational Structure and Principal and Selling Stockholder. American Securities may acquire or hold interests that compete directly with us, or may pursue acquisition opportunities which are complementary to our business, making such an acquisition unavailable to us. Our amended and restated certificate of incorporation will contain provisions renouncing any interest or expectancy held by our directors affiliated with American Securities in certain corporate opportunities. For further information, see Risk Factors Risks Related to Our Company and Our Organizational Structure. Table of Contents Headquartered in New York with an office in Shanghai, American Securities is a leading U.S. middle-market private equity firm that invests in market-leading North American companies. American Securities now has approximately $10 billion of assets under management and is investing from its sixth fund. The firm traces its roots to the family office founded in 1947 by William Rosenwald to invest and manage his share of the Sears, Roebuck & Co. fortune. American Securities focuses its core investments in the industrial sector including, general industrial, aerospace and defense, agriculture, environmental, automotive, recycling paper and packaging, power and energy, and specialty chemicals. American Securities has a strong understanding of our business and close relationships with the existing management. American Securities has a proven track record of successfully working with management teams to develop and implement strategies for sustained profitability. Risks Affecting Our Business Investing in our common stock involves substantial risk. Before participating in this offering, you should carefully consider all of the information in this prospectus, including risks discussed in Risk Factors beginning on page 23. Some of our most significant risks are: volatility in the global economy impacting demand for new vehicles and our products; a decline in vehicle production levels, particularly with respect to Platforms for which we are a significant supplier, or the financial distress of any of our major customers; our dependence on large-volume customers for current and future sales; our inability to realize all of the sales expected from awarded business or fully recover pre-production costs; our inability to realize revenue expected from incremental business backlog; a reduction in outsourcing by our customers, the loss of material production or Programs, or a failure to secure sufficient alternative Programs; our significant competition; our failure to offset continuing pressure from our customers to reduce our prices; our failure to maintain our cost structure; potential significant costs at our facility in Sandusky, Ohio; disruption from the Combination of our operations and diversion of management s attention; and our limited history of working as a single company and the inability to successfully integrate HHI, Metaldyne and Grede. Corporate Information We are a Delaware corporation. MPG was incorporated on June 9, 2014. Our principal executive offices are located at 47659 Halyard Drive, Plymouth, MI 48170. Our telephone number at our principal executive offices is (734) 207-6200. Our corporate website is www.metaldyneperformancegroup.com. The information that appears on our website is not part of, and is not incorporated into, this prospectus. Table of Contents The Offering Common stock offered by the selling stockholder 15,384,615 shares (17,692,307 shares if the underwriters exercise their option to purchase additional shares in full) Selling stockholder The selling stockholder in this offering is an affiliate of American Securities. See Principal and Selling Stockholder. Common stock to be outstanding after this offering 67,073,255 shares Option to purchase additional shares of common stock The underwriters have the option to purchase up to an additional 2,307,692 shares of common stock from the selling stockholder identified in this prospectus. The underwriters can exercise this option at any time within 30 days from the date of this prospectus. Use of proceeds We will not receive any net proceeds from the sale of shares by the selling stockholder, including with respect to the underwriters option to purchase additional shares from the selling stockholder. See Use of Proceeds for additional information. Dividend policy After the completion of this offering, we intend to pay cash dividends on our common stock, subject to our compliance with applicable law, and depending on, among other things, our results of operations, financial condition, level of indebtedness, capital requirements, contractual restrictions, restrictions in our debt agreements, business prospects and other factors that our board of directors may deem relevant. Future agreements may also limit our ability to pay dividends. See Dividend Policy and Description of Certain Indebtedness. Voting rights Each share of our common stock will entitle its holder to one vote on all matters to be voted on by stockholders generally. See Description of Capital Stock.
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+PROSPECTUS SUMMARY The following is a summary of material information discussed in this prospectus. The summary is not complete and does not contain all of the information that you should consider before investing in our ordinary shares. You should read this entire prospectus carefully, including the risks discussed under
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+Prospectus Summary 1
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+Prospectus Summary 1
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and is qualified in its entirety by the more detailed information and consolidated financial statements included elsewhere in this prospectus. This summary does not contain all of the information that may be important to you. You should read and carefully consider the following summary together with the entire prospectus, including our consolidated financial statements and the notes thereto appearing elsewhere in this prospectus and the matters discussed in the sections in this prospectus entitled Risk Factors, Selected Consolidated Financial Data and Management s Discussion and Analysis of Financial Condition and Results of Operations before deciding to invest in our common stock. Some of the statements in this prospectus constitute forward-looking statements that involve risks and uncertainties. See Special Note Regarding Forward-Looking Statements. Our actual results could differ materially from those anticipated in such forward-looking statements as a result of certain factors, including those discussed in the Risk Factors and other sections of this prospectus. Except as otherwise indicated herein or as the context otherwise requires, references in this prospectus to MacroGenics the company, we, us and our refer to MacroGenics, Inc. and its consolidated subsidiaries. Overview We are a clinical-stage biopharmaceutical company focused on discovering and developing innovative monoclonal antibody-based therapeutics for the treatment of cancer and autoimmune diseases. We generate our pipeline of product candidates from our proprietary suite of next-generation antibody technology platforms, which we believe improve the performance of monoclonal antibodies and antibody-derived molecules. These product candidates, which we have identified through our understanding of disease biology and immune-mediated mechanisms, may address disease-specific challenges which are not currently being met by existing therapies. Some of these product candidates include therapeutics in the emerging field of immune oncology and are designed to promote tumor destruction by either enhancing or restoring the body s immune system to destroy cancers. We create both differentiated molecules that are directed to novel cancer targets, as well as bio-betters, which are drugs designed to improve upon marketed medicines. The combination of our technology platforms and antibody engineering expertise has allowed us to generate promising product candidates and enter into several strategic collaborations with global pharmaceutical and biotechnology companies. These collaborations provide us with funding and allow us to leverage the additional expertise of our collaborators to advance the development of our product candidates. We have three versatile, proprietary technology platforms that can be applied in combination with one another to custom design an antibody or antibody-derived molecule that is optimized to treat a specific disease. These technologies are described below. (1) Our Dual Affinity Re-Targeting, or DART, platform enables the targeting of multiple antigens or cells by using a single molecule with an antibody-like structure, and also includes the ability to recruit any T cell in a patient s body to destroy targeted cancer cells. We have created over 100 DART-based molecules, or DARTs, which we believe improve upon the human immune system and have more potent immune properties than the parent antibody molecules from which they are derived. (2) Our Fc Optimization platform enhances the body s immune system to mediate the killing of cancer cells through a mechanism called antibody-dependent cellular cytotoxicity, or ADCC, in which antibodies and immune cells cooperate to destroy targets such as tumor cells. To date, we have successfully incorporated our Fc Optimization technology into our two lead oncology product candidates and have pre-clinical data demonstrating that these antibodies have substantially greater ability to kill cancer cells than similar antibodies that have not been Fc-optimized. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is declared effective. This preliminary prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities in any state where the offer or sale is not permitted. Registration File No. 333-193648 Subject to Completion Preliminary Prospectus Dated February 12, 2014 PROSPECTUS 2,500,000 Shares Common Stock We are selling 1,500,000 shares of our common stock at per share. The selling stockholders identified in this prospectus are offering an additional 1,000,000 shares. We will not receive any of the proceeds from the sale of the shares being offering by the selling stockholders. Our common stock is listed on the NASDAQ Global Select Market under the symbol MGNX . On February 11, 2014 the last sale price of our common stock was $37.17 per share. We are an emerging growth company as that term is used in the Jumpstart Our Business Startups Act of 2012 and, as such, have elected to comply with certain reduced public company reporting requirements for this prospectus and future filings. Investing in our common stock involves risks that are described in the Risk Factors section beginning on page 11 of this prospectus. Per share Total Public offering price $ $ Underwriting discounts and commissions1 $ $ Proceeds before expenses, to us $ $ Proceeds before expenses, to the selling stockholders $ $ 1 We refer you to Underwriting beginning on page 154 of this prospectus for additional information regarding total underwriter compensation. The underwriters may also exercise their option to purchase up to an additional 375,000 shares from us for 30 days after the date of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The shares will be ready for delivery on or about February , 2014. BofA Merrill Lynch Leerink Partners Stifel Wedbush PacGrow Life Sciences Roth Capital Partners The date of this prospectus is February , 2014. Table of Contents (3) Our Cancer Stem-like Cell, or CSLC, platform provides a unique discovery tool to identify cancer targets shared both by tumor-initiating cells and the differentiated cancer cells derived from them. Using this platform, we can create antibodies or antibody-derived molecules that specifically target and destroy CSLCs, potentially enabling us to address the large, unmet medical needs of many cancers that are difficult to treat. We utilize one or more of our technology platforms for engineering and optimizing our antibody and antibody-derived product candidates. Many of our cancer product candidates are derived from our library of over 2,000 purified antibodies. We believe our approach allows us to take advantage of the enhanced properties of an engineered antibody or antibody-derived molecule to kill cancer cells and to interfere with autoimmune disorders more effectively than a wild type, or non-engineered, monoclonal antibody. Our methods for improving the effectiveness of antibodies include the following: enhancing the body s immune system; targeting multiple antigens on the surface of the same target cell; increasing the strength of the binding of an antibody to its antigen targets; and reducing the likelihood of an unwanted immune response to the antibody or antibody-derived molecule. We believe our differentiated product candidates have the potential to provide new approaches to treat cancer, autoimmune disorders and other complex diseases and to improve clinical outcomes. We have entered into strategic collaborations with Les Laboratoires Servier and Institut de Recherches Servier, or collectively, Servier, Gilead Sciences, Inc., or Gilead, Boehringer Ingelheim International GmbH, or Boehringer, and Pfizer, Inc., or Pfizer, among others. Under our current strategic collaborations, we have received approximately $106 million in non-equity funding during the three year period ended June 30, 2013. Under these agreements, we believe we are likely to receive over $100 million of milestone and other payments subsequent to June 30, 2013 and by the end of 2015, assuming all of our collaboration programs advance as currently contemplated. Between June 30, 2013 and December 31, 2013, we received a total of $22 million from our collaboration partners. As of December 31, 2013, we had $116.7 million in cash and cash equivalents. Our Product Candidates We currently have two oncology product candidates in clinical development. We also have several proprietary product candidates in pre-clinical development and we expect to commence Phase 1 clinical trials on two of these product candidates in 2014. In addition, we intend to use a portion of the net proceeds from this offering to advance two pre-clinical DART-based oncology product candidates to IND submission and commence Phase 1 clinical trials in 2015. We believe the profile of our compounds provides us with the flexibility to pursue either monotherapy or combination therapy, depending on disease characteristics, current standards of care, and overall safety, tolerability and efficacy of specific regimens. Table of Contents TABLE OF CONTENTS Prospectus Summary 1
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY Corporate Overview We were incorporated in the state of Nevada on June 5, 2008 under the name Business Outsourcing Services, Inc. Effective August 31, 2011, we completed a merger with our subsidiary, Orgenesis Inc., a Nevada corporation which was incorporated solely to effect a change in our name. As a result, we changed our name from Business Outsourcing Services, Inc. to Orgenesis Inc. Effective August 31, 2011, we effected a 35 to 1 forward stock split of our authorized and issued and outstanding common stock. As a result, our authorized capital has increased from 50,000,000 shares of common stock with a par value of $0.0001 to 1,750,000,000 shares of common stock with a par value of $0.0001. On February 27, 2012, we filed a Certificate of Correction with the Secretary of State of the State of Nevada, correcting the par value of 1,750,000,000 shares of common stock which was incorrectly stated as $0.001 to 1,750,000,000 shares of common stock with a par value of $0.0001. Unless otherwise noted, all references in this prospectus to number of shares, price per share or weighted average number of shares outstanding have been adjusted to reflect the stock split on a retroactive basis. Our Current Business On August 5, 2011, we entered into a letter of intent with Prof. Sarah Ferber and Ms. Vered Caplan according to which, inter alia, Prof. Ferber has agreed to use commercially reasonable efforts to cause Tel Hashomer to license us all of the assets associated with Methods Of Inducing Regulated Pancreatic Hormone Production and Methods Of Inducing Regulated Pancreatic Hormone Production In Non-Pancreatic Islet Tissues . On October 11, 2011, we incorporated Orgenesis Ltd. as our wholly-owned subsidiary under the laws of Israel. On February 2, 2012, Orgenesis Ltd. signed and closed a definitive agreement to license patents and knowhow related to the development of autologous insulin producing (AIP) cells. Based on the licensed knowhow and patents, our intention is to develop to the clinical stage a new technology for regeneration of functional insulin-producing cells, thus enabling normal glucose regulated insulin secretion, via cell therapy. By using a therapeutic agent (i.e., PDX-1, or additional pancreatic transcription factors in adenovirus-vector) that efficiently converts a sub-population of liver cells into pancreatic islets phenotype and function, this approach allows the diabetic patient to be the donor of his own therapeutic tissue. The development of AIP cells is based on the licensed patents and knowhow. We believe that our major competitive advantage is in our cell transformation technology. This technology was licensed based on the published work of Prof. Ferber. Prof. Ferber has developed this technology, as a researcher in Tel Hashomer, and has established a proof of concept that demonstrates the capacity to induce a shift in the developmental fate of cells in liver and convert them into pancreatic beta cell like cells. Furthermore, those cells were found to be resistant to the autoimmune attack. We intend to develop our business by further developing the technology to a clinical stage. We intend to dedicate most of our capital to research and development with no expectation of revenue from product sales in the foreseeable future. Directors and Executive Officers As of March 5, 2014, our directors and executive officers are as follows: The information in this prospectus is not complete and may be changed. We may not sell these securities until the Registration Statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any State where the offer or sale is not permitted. Subject to Completion, Dated ______________, 2014 Preliminary Prospectus Orgenesis Inc. 10,603,436 shares of common stock _________________________________ The selling stockholders identified in this prospectus may offer and sell up to 10,603,436 shares of our common stock, which will consist of: (i) up to 250,000 shares of common stock issued or to be issued to Kodiak Capital Group, LLC ( Kodiak ) as commitment shares pursuant to an Investment Agreement dated December 13, 2013 (the Investment Agreement ) and up to 7,300,000 shares of common stock to be sold by Kodiak pursuant to the Investment Agreement; (ii) 1,526,718 shares of common stock issued to ATMI BVBA; and (iii) up to 1,526,718 shares of common stock that may be issued upon the exercise of warrants issued to ATMI BVBA. The 7,550,000 shares of common stock registered for resale by Kodiak represents 14% of our issued and outstanding shares of common stock as of March5, 2014. The selling stockholders may sell all or a portion of the shares being offered pursuant to this prospectus at fixed prices, at prevailing market prices at the time of sale, at varying prices or at negotiated prices. We will not receive any proceeds from the sale of the shares of our common stock by the selling stockholders. We will pay for expenses of this offering, except that the selling stockholders will pay any broker discounts or commissions or equivalent expenses applicable to the sale of their shares. Kodiak is an underwriter within the meaning of the Securities Act of 1933 and other selling stockholders and any broker-dealers or agents that are involved in selling the shares may be deemed to be underwriters within the meaning of the Securities Act of 1933 in connection with such sales. In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the shares purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act of 1933. Our common stock is quoted on Financial Industry Regulatory Authority s OTC Bulletin Board under the symbol ORGS . On March 5, 2014, the closing sale price for our common stock as reported by the OTC Bulletin Board was $0.56 per share. OUR BUSINESS IS SUBJECT TO MANY RISKS AND AN INVESTMENT IN OUR COMMON STOCK OFFERED THROUGH THIS PROSPECTUS WILL ALSO INVOLVE A HIGH DEGREE OF RISK. YOU SHOULD CAREFULLY READ AND CONSIDER THE SECTION OF THIS PROSPECTUS ENTITLED RISK FACTORS BEGINNING ON PAGE 6 OF THIS PROSPECTUS BEFORE BUYING ANY SHARES OF OUR COMMON STOCK. YOU SHOULD NOT INVEST UNLESS YOU CAN AFFORD TO LOSE YOUR ENTIRE INVESTMENT. You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with different information. You should not assume that the information in this prospectus is accurate as of any date other than the date of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is ____________________, 2014. Name Position Held with our Company Vered Caplan Interim President ,Chief Executive Officer and Chairperson of the board of directors Jacob BenArie Chief Executive Officer of the Israeli Subsidiary Dov Weinberg Chief Financial Officer, Treasurer and Secretary Sarah Ferber Chief Scientific Officer Guy Yachin Director Etti Hanochi Director Yaron Adler Director Dr. David Sidransky Director See Directors and Executive Officers on page 29. Share Capital We are authorized to issue 1,750,000,000 common shares with a par value of $0.0001 per share. As of March 5, 2014, there were 53,860,299common shares outstanding. Summary of the Offering Shares being offered: The selling stockholders identified in this prospectus may offer and sell up to 10,603,436 shares of our common stock, which will consists of: (i) up to 250,000 shares of common stock issued or to be issued to Kodiak as commitment shares pursuant to the Investment Agreement and up to 7,300,000 shares of common stock to be sold by Kodiak pursuant to the Investment Agreement; (ii) 1,526,718 shares of common stock issued to ATMI BVBA; and (iii) up to 1,526,718 shares of common stock that may be issued upon the exercise of warrants issued to ATMI BVBA. The 7,550,000 shares of common stock registered for resale by Kodiak represents 14% of our issued and outstanding shares of common stock as of March 5, 2014. Offering Price per share: The selling stockholders may sell all or a portion of the shares being offered pursuant to this prospectus at fixed prices, at prevailing market prices at the time of sale, at varying prices or at negotiated prices. Use of Proceeds: We will not receive any proceeds from the sale of the shares of our common stock by the selling stockholders. We will pay for expenses of this offering, except that the selling stockholders will pay any broker discounts or commissions or equivalent expenses applicable to the sale of their shares.
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+PROSPECTUS SUMMARY This summary highlights information contained or incorporated by reference elsewhere in this prospectus. You should read the following summary together with the more detailed information appearing or incorporated by reference in this prospectus, including our consolidated financial statements and related notes, and in Risk Factors beginning on page 8, before deciding whether to purchase shares of our Class A common stock. Unless the context otherwise requires, we use the terms Veeva, the company, we, us and our in this prospectus to refer to Veeva Systems Inc. and its subsidiaries. VEEVA SYSTEMS INC. Veeva is a leading global provider of industry-specific, cloud-based software solutions for the life sciences industry. Our solutions enable pharmaceutical and other life sciences companies to realize the benefits of modern cloud-based architectures and mobile applications for their most critical business functions, without compromising industry-specific functionality or regulatory compliance. Our customer relationship management solutions enable our customers to increase the productivity and compliance of their sales and marketing functions. Our regulated content management and collaboration solutions enable our customers to more efficiently manage a range of highly regulated, content-centric processes across the enterprise. Our customer master solution enables our customers to more effectively manage complex healthcare provider and healthcare organization data. We have built our company s culture around customer success and believe that our customers consider us a strategic business partner. We founded our company in 2007 on the premise that industry-specific business problems would best be addressed by industry-specific, cloud-based solutions, an approach referred to as Industry Cloud. We believe Industry Cloud solutions are particularly relevant to global, complex and heavily regulated industries, such as the life sciences industry that we serve. Although there are some basic functions within life sciences companies that horizontal cloud-based solutions have been able to address, such as payroll and expense management, the industry has largely continued to rely on legacy, on-premise information technology (IT) systems to meet industry-specific needs in critical business functions such as new drug submissions, quality management, sales and marketing. As a result, prior to Veeva, life sciences companies were largely unable to implement cloud-based solutions for many of their most critical business functions. Our Industry Cloud for life sciences consists of cloud-based solutions that were designed from the ground up to address the specific business and regulatory requirements of this global industry. Veeva CRM, our customer relationship management solution for sales representatives, enables a broad range of industry-specific functions such as drug sample tracking with electronic signature capture, healthcare affiliations management, and the ability to conduct interactive, rich media demonstrations with physicians on a mobile device, with or without an internet connection. Veeva Vault, our regulated content management and collaboration solution, enables the management of complex, content-centric processes, such as the collection, management and organization of thousands of documents during clinical trials and managing the complex versioning, workflows and approvals for promotional materials, in compliance with stringent government regulations. Veeva Network, our customer master solution, enables the creation and maintenance of the healthcare provider and organization master data that drives life sciences companies sales and marketing operations. Our solutions utilize multi-tenant architectures, allowing us to rapidly deliver new functionality to all customers simultaneously and enabling our customers to benefit from our innovations and to comply with frequently changing regulations more quickly because all customers are using the same version of our solutions. A multi-tenant architecture is one that allows multiple customers to use the same hardware and software infrastructure while keeping each customer s data logically separated. In addition, our global employee base, including our professional services team, gives us insights into industry best practices that can be quickly Table of Contents The information in this prospectus is not complete and may be changed. Neither we nor the selling stockholders may sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and neither we nor the selling stockholders are soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted. PROSPECTUS (Subject to Completion) Issued March 24, 2014 12,000,000 Shares CLASS A COMMON STOCK Veeva Systems Inc. is offering 890,000 shares of its Class A common stock and the selling stockholders are offering 11,110,000 shares of Class A common stock. We will not receive any proceeds from the sale of shares by the selling stockholders. We have two classes of common stock, Class A common stock and Class B common stock. The rights of the holders of Class A common stock and Class B common stock are identical, except voting and conversion rights. Each share of Class A common stock is entitled to one vote. Each share of Class B common stock is entitled to ten votes and is convertible at any time into one share of Class A common stock. The holders of our outstanding Class B common stock will hold approximately 97.3% of the voting power of our outstanding capital stock following this offering, and our executive officers and directors and their affiliates will hold approximately 72.8% of the voting power of our outstanding capital stock following this offering. Our Class A common stock is listed on the New York Stock Exchange under the symbol VEEV. On March 21, 2014, the last reported sale price of our Class A common stock on the New York Stock Exchange was $30.11 per share. We are an emerging growth company as defined under the federal securities laws. Investing in our Class A common stock involves risks. See Risk Factors beginning on page 8. PRICE $ A SHARE Price to Public Underwriting Discounts and Commissions(1) Proceeds to Veeva Proceeds to Selling Stockholders Per share $ $ $ $ Total $ $ $ $ (1) See Underwriting for a description of the compensation payable to the underwriters. We and the selling stockholders have granted the underwriters the right to purchase up to an additional 1,800,000 shares of Class A common stock to cover over-allotments. The Securities and Exchange Commission and state regulators have not approved or disapproved of these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The underwriters expect to deliver the shares of Class A common stock to purchasers on , 2014. MORGAN STANLEY DEUTSCHE BANK SECURITIES J.P. MORGAN PACIFIC CREST SECURITIES CANACCORD GENUITY STIFEL WELLS FARGO SECURITIES , 2014 Table of Contents incorporated into our solutions, benefitting all of our customers. We believe this industry-focused approach of continual improvement has the potential to make our Industry Cloud the standard for the life sciences industry. In addition, we believe that the data generated from our deep, industry-specific applications can provide unique insights about the industry that we can incorporate into our solutions, further increasing the value of our Industry Cloud. An element of our strategy has been to build a global enterprise to serve the needs of the life sciences industry worldwide. As of January 31, 2014, we had 725 employees, including approximately 236 employees located outside North America, primarily in Europe, Japan and China. Our solutions are designed to enable compliance with global regulatory requirements and are available in 27 languages. For our fiscal year ended January 31, 2014, international revenues constituted 41% of our total revenues. We believe our global presence is a significant strategic asset, as our employees maintain strong local relationships with senior customer executives and obtain valuable feedback on both our existing and potential solutions suited to specific geographies. We have achieved rapid customer growth and strong customer retention, which we believe is largely due to our focus on customer success. As of January 31, 2012, 2013 and 2014, we served 95, 134 and 198 life sciences customers, respectively, including 33 of the 50 largest global pharmaceutical companies as of January 31, 2014. Our solutions have been implemented in over 80 countries, ranging from deployments within a single division or geography to major deployments at some of the largest global pharmaceutical companies, including Bayer Healthcare AG, Boehringer Ingelheim GmbH, Eli Lilly and Company, Gilead Sciences, Inc., Merck & Co., Inc. and Novartis International AG, as well as projects at smaller life sciences companies. For an explanation of how we define our current customers, please see Management s Discussion and Analysis of Financial Condition and Results of Operations Components of Results of Operations. We have experienced significant growth in revenues and profitability in a short period of time. For our fiscal years ended January 31, 2012, 2013 and 2014, our total revenues were $61.3 million, $129.5 million and $210.2 million, respectively, representing year-over-year growth in total revenues of 111% and 62% for our two most recent fiscal years. For our fiscal years ended January 31, 2012, 2013 and 2014, our subscription services revenues were $32.6 million, $73.3 million and $146.6 million, respectively, representing year-over-year growth in subscription services revenues of 125% and 100% for our two most recent fiscal years. We generate revenues from subscription fees and from professional services fees, for configuration, implementation and training. We generated net income of $4.2 million, $18.8 million and $23.6 million for our fiscal years ended January 31, 2012, 2013 and 2014, respectively. Corporate Information We were incorporated in the state of Delaware in January 2007 and changed our name to Veeva Systems Inc. from Verticals onDemand, Inc. in April 2009. Our principal executive offices are located at 4637 Chabot Drive, Suite 210, Pleasanton, California 94588. Our telephone number is (925) 452-6500. Our website address is www.veeva.com. Information contained on our website is not incorporated by reference into this prospectus, and you should not consider information contained on our website to be part of this prospectus or in deciding whether to purchase shares of our Class A common stock. Veeva, the Veeva logo, Veeva CRM, Veeva CLM, Veeva iRep, Veeva CRM Approved Email, Veeva CRM Engage, Veeva Network, Veeva Vault, Vault eTMF, Vault Investigator Portal, Vault Submissions, Vault QualityDocs, Vault PromoMats, Vault MedComms, Approved Email, Vault, iRep and other trademarks or service marks of Veeva appearing or incorporated by reference in this prospectus are the property of Veeva. This prospectus or the documents incorporated by reference in this prospectus contain additional trade names, trademarks and service marks of ours and of other companies. We do not intend our use or display of other companies trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, these other companies. Table of Contents Table of Contents THE OFFERING Class A common stock offered By us 890,000 shares By the selling stockholders 11,110,000 shares Total 12,000,000 shares Class A common stock to be outstanding after this offering 27,044,750 shares Class B common stock to be outstanding after this offering 98,736,795 shares Total Class A and Class B common stock to be outstanding after this offering 125,781,545 shares Over-allotment option to purchase additional shares of Class A common stock offered By us 500,000 shares By the selling stockholders 1,300,000 shares Total 1,800,000 shares Use of proceeds We estimate that our net proceeds from the sale of the Class A common stock that we are offering will be approximately $25.0 million, assuming a public offering price of $30.11 per share, the last reported sale price of our Class A common stock on the New York Stock Exchange on March 21, 2014, and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us. We will not receive any of the proceeds from the sale of shares of Class A common stock by the selling stockholders. The principal purposes of this offering are to increase our financial flexibility, obtain additional capital, facilitate an orderly distribution of shares for the selling stockholders, increase our public float and increase our visibility in the marketplace. We intend to use the net proceeds to us from this offering for working capital and other general corporate purposes. However, we do not currently have specific planned uses of the proceeds. In addition, we may use a portion of the net proceeds from this offering for acquisitions of or investments in other complementary businesses, technologies or other assets. However, we currently have no agreements or commitments with respect to any specific material acquisitions or investments at this time. See Use of Proceeds. Table of Contents TABLE OF CONTENTS Page Prospectus Summary 1
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. You should read the entire prospectus carefully before making an investment decision, including the information under the headings Risk Factors, Cautionary Note Regarding Forward-Looking Statements and Management s Discussion and Analysis of Financial Condition and Results of Operations and the historical and pro forma combined financial statements and the related notes thereto appearing elsewhere in this prospectus. The information presented in this prospectus assumes (i) an initial public offering price of $20.00 per share of Class A common stock (the midpoint of the price range set forth on the cover of this prospectus) and (ii) unless otherwise indicated, that the underwriters do not exercise their option to purchase additional shares of Class A common stock. In this prospectus, unless the context otherwise requires, the terms Spark Energy, the Company, we, us and our refer collectively to (i) the combined business and assets of the retail natural gas business and asset optimization activities of Spark Energy Gas, LLC ( SEG ) and the retail electricity business of Spark Energy, LLC ( SE ) before the completion of our corporate reorganization in connection with this offering and (ii) Spark Energy, Inc. and its subsidiaries as of the completion of our corporate reorganization and thereafter. See Corporate Reorganization. References to Spark Energy Ventures refer to Spark Energy Ventures, LLC, which owned SEG and SE prior to the transactions we implemented as part of our corporate reorganization. References to NuDevco refer collectively to NuDevco Retail Holdings, LLC ( NuDevco Retail Holdings ) and its wholly owned subsidiary, NuDevco Retail, LLC ( NuDevco Retail ), the interim owners of SE and SEG during the corporate reorganization and the owners of the Class B common stock and the related Spark HoldCo units following this offering. References to Spark HoldCo refer to Spark HoldCo, LLC, our subsidiary and the direct parent of SEG and SE at the completion of the corporate reorganization. Spark Energy Ventures, NuDevco, SEG and SE have historically been under common control. We have provided a glossary of certain retail energy industry terms used in this prospectus as Appendix A. Business Overview We are a growing independent retail energy services company founded in 1999 that provides residential and commercial customers in competitive markets across the United States with an alternative choice for their natural gas and electricity. We purchase our natural gas and electricity supply from a variety of wholesale providers and bill our customers monthly for the delivery of natural gas and electricity based on their consumption at either a fixed or variable price. Natural gas and electricity are then distributed to our customers by local regulated utility companies through their existing infrastructure. As of May 31, 2014, we operated in 46 utility service territories across 16 states and had approximately 237,600 residential customers and 17,800 commercial customers, which translates to over 392,500 residential customer equivalents ( RCEs ). An RCE is an industry standard measure of natural gas or electricity usage with each RCE representing annual consumption of 100 MMbtu of natural gas or 10 MWh of electricity. We added over 44,800 customers, net of attrition, during the first five months of 2014. For the year ended December 31, 2013, approximately 60% of our retail revenues were derived from the sale of electricity, and the remainder were derived from the sale of natural gas. We believe our business model is scalable, and our objective is to maximize profitability while proactively managing the risks inherent in our business. To achieve this objective, we actively manage our customer base to allocate retail energy sales between natural gas and electricity based on existing or developing market dynamics. In addition, the diversity in our customer base across geography, commodity and product offerings allows us to mitigate risk and react to changes in the retail energy environment so that we can quickly shift our focus and Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell securities, and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED JULY 28, 2014 PRELIMINARY PROSPECTUS 3,000,000 Shares SPARK ENERGY, INC. CLASS A COMMON STOCK This is the initial public offering of our Class A common stock, par value $0.01 per share. We are selling 3,000,000 shares of Class A common stock in this offering. Prior to this offering, there has been no public market for our Class A common stock. The initial public offering price of the Class A common stock is expected to be between $19.00 and $21.00 per share. We have applied to list our Class A common stock on the NASDAQ Global Select Market under the symbol SPKE. We have granted the underwriters an option to purchase from us up to 450,000 additional shares of Class A common stock. We are an emerging growth company as that term is used in the Jumpstart Our Business Startups Act of 2012, and as such, we have elected to take advantage of certain reduced public company reporting requirements for this prospectus and future filings. See Risk Factors and Prospectus Summary Emerging Growth Company Status. The initial public offering price of our Class A common stock may not be indicative of the market price of our Class A common
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diff --git a/parsed_sections/prospectus_summary/2014/VUZI_vuzix-corp_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/VUZI_vuzix-corp_prospectus_summary.txt
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+Prospectus Summary This summary highlights information contained
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diff --git a/parsed_sections/prospectus_summary/2014/XENE_xenon_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/XENE_xenon_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2014/XNET_xunlei-ltd_prospectus_summary.txt b/parsed_sections/prospectus_summary/2014/XNET_xunlei-ltd_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..1bad3ef27bde17d559663c7ad7f29616f43a62b6
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+Prospectus summary The following summary is qualified in its entirety by, and should be read in conjunction with, the more detailed information and financial statements appearing elsewhere in this prospectus. In addition to this summary, we urge you to read the entire prospectus carefully, especially the risks of investing in our ADSs discussed under "Risk factors," before deciding whether to buy our ADSs. This summary and other sections of this prospectus contain (i) information from a report, referred to in this prospectus as the iResearch Report, which we commissioned from iResearch Consulting Group, or iResearch, a third-party market research firm, to provide certain information including the number of monthly active users of Xunlei Accelerator and (ii) information from other publicly available reports by China Internet Network Information Center, or CNNIC, Analysys International or iResearch, which are identified by the statement "according to CNNIC," "according to Analysys International" or "according to iResearch" in this prospectus, as appropriate, and include, among others, information from the iUser Tracker database of iResearch containing overall market data on the internet industry in China. Our business We are one of the top 10 largest Chinese internet companies, as measured by user base. According to iResearch, we had an average of approximately 300 million monthly unique visitors for the three months ended on March 31, 2014. Digital media content, such as video, music and games, is one of the most popular usages for internet users in China. We operate a powerful internet platform in China based on cloud computing to enable users to quickly access, manage, and consume digital media content. We are increasingly extending to mobile devices in part through potentially pre-installed acceleration products in mobile phones and to living rooms through TV coverage (set-top boxes and IPTV) to further expand our user base and offer our users a wider range of access points. We aspire to deliver superior user experience in ease of access, management and consumption of digital media content anywhere, anytime, and on any device. We are the No. 1 acceleration product provider in China as measured by market share in March 2014, according to iResearch. To address deficiencies of digital media transmission over the internet in China, such as low speed and high delivery failure rates, we provide users with quick and easy access to online digital media content through two core products and services: Xunlei Accelerator, which enables users to accelerate digital transmission over the internet, is our most popular and free product, with approximately 142 million monthly active users and approximately 204 million monthly unique visitors in March 2014, according to the iResearch Report. Xunlei Accelerator enjoys a market share of 84.1% based on the number of launches among all transmission and acceleration products in China in March 2014, according to iResearch; and Our cloud acceleration subscription services, delivered through products such as Green Channel, Offline Accelerator and Yunbo, offer users premium services for speed and reliability, with approximately 5.2 million subscribers as of March 31, 2014, up from approximately 1.1 million as of January 31, 2011. Amendment No. 3 to FORM F-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents Benefitting from the large user base for our core product, Xunlei Accelerator, we have further developed various value-added services to meet a fuller spectrum of our users' digital media content access and consumption needs including: Xunlei Kankan, the 6th largest online video streaming platform in China, with monthly unique visitors of approximately 136.0 million in March 2014, according to iResearch. Users can watch what they want for free from our comprehensive content library; Pay per view services, launched in the second half of 2012 and serving approximately 155,000 subscribers as of March 31, 2014, providing them with access to our premium content library of over 800 movies, primarily new releases. As of March 31, 2014, about 58% of our pay per view subscribers are also subscribers for our premium acceleration services, presenting opportunities for further cross-selling; and Online game services, including web games and massive multiplayer online games, or MMOGs, offered on our gaming platform. We are increasingly expanding our services to living room based internet devices and mobile devices, as part of our cloud-based home and mobile strategies. Starting in 2013, we began to pre-install our acceleration products in set-top boxes distributed by third-party hardware providers. As of March 31, 2014, we had accumulated an installed base of approximately 1,552,000 set-top boxes across China. We believe our living room strategy combined with our success on PC internet will provide a seamless user experience to access digital media content from any device. We also target to make our mobile applications the central user interface for accessing and managing digital media content in a synchronized manner. Since 2012, we have entered into pre-installment service agreements with several mobile phone manufacturers, including a Xiaomi group company, pursuant to which we agree to provide our Xunlei mobile acceleration applications, and the mobile phone manufacturers agree to install such applications on their phones, free of charge. Xiaomi is a well-recognized smart phone brand in China and once such pre-installment arrangements are implemented, Xiaomi phone users will have access to our acceleration services, which could enhance our ability to generate more user traffic. These strategies and our compelling value proposition will provide us with the foundation to further grow our user base and allow our customers to access and enjoy digital media content regardless of device or location. The technological backbone of our products and services is our cloud acceleration technology, comprised of a proprietary file locating system and massive file index database. Our technology enables us to support greater user expansion with incremental increases in server and bandwidth costs. This technology, based on distributed computing architecture, along with our indexing technology, enables users to access content in an efficient manner. We have successfully monetized our large user base. We generate revenues primarily through the following services: Cloud subscription services. We provide premium acceleration services for subscribers to enable faster and more reliable access to digital media content; Online advertising services. We offer advertising services by providing marketing opportunities on our online video streaming websites and platform to our advertisers; and XUNLEI LIMITED (Exact name of Registrant as specified in its charter) Not Applicable (Translation of Registrant's name into English) Cayman Islands (State or other jurisdiction of incorporation or organization) 7370 (Primary Standard Industrial Classification Code Number) Not Applicable (I.R.S. Employer Identification Number) 4/F, Hans Innovation Mansion, North Ring Road No. 9018 High-Tech Park, Nanshan District Shenzhen, 518057 People's Republic of China (86-755) 3391-2900 (Address, including zip code, and telephone number, including area code, of Registrant's principal executive offices) Table of Contents Other internet value-added services. We offer multiple other value-added services to our users, including online games and pay per view services. We have grown significantly in recent years. Our revenues increased from US$87.5 million in 2011 to US$148.2 million in 2012 and US$180.2 million in 2013. We had net loss attributable to Xunlei Limited of US$0.01 million in 2011 and net income attributable to Xunlei Limited of US$0.5 million in 2012 and US$10.7 million in 2013, respectively. Our revenues were US$41.3 million and US$41.2 million for the three months ended March 31, 2013 and 2014, respectively. We had net income attributable to Xunlei Limited of US$3.9 million for the three months ended March 31, 2013 and US$0.4 million for the same period in 2014. Our industry The proliferation of internet usage in China in recent years has made China the largest internet market in the world. According to China Internet Network Information Center, or CNNIC, the number of internet users in China had reached 618 million as of December 31, 2013. In addition, China had a broadband penetration rate of 88.8% among internet users as of December 31, 2012, according to iResearch. With the increasing internet penetration in China, several leading internet platforms have emerged and attracted large user base. According to iResearch, there are only 12 internet platforms in China with over 300 million monthly unique visitors, based on the data for the month ended March 31, 2014, including Xunlei. As internet penetration continues to increase in China and throughout the world, digital media has proliferated, resulting in enormous amount of digital media content flow through the internet. Online video. Online video usage in China has grown significantly in recent years after an initial lag caused by bandwidth limitations and software and hardware compatibility requirements. According to iResearch, the size of China's online video market, as measured by revenues, is expected to grow from 6.3 billion Renminbi, or RMB, in 2011 to RMB29.8 billion in 2016, representing a CAGR of 36.6%. Online games. Online gaming is one of the most popular online activities in China. According to iResearch, the size of China's online gaming market, as measured by revenues, is expected to grow from RMB53.4 billion in 2011 to RMB183.7 billion in 2016, representing a CAGR of 27.8%. In addition to PC and mobile, TV is also emerging as a new outlet for internet consumption. According to Analysys International, the installed base of OTT (over-the-top) TVs in China, including smart TVs and TVs with smart set-top boxes connections, was 17.0 million as of December 31, 2012, and is expected to increase to 208.0 million as of December 31, 2016, representing a CAGR of 87.0%. Although the internet has become the mainstream channel for accessing digital media content, challenges for data transmission still exist. The size of digital media content files continues to grow to provide better user experience, which generates significant demand and opportunities for accelerated data transmission. Increasing consumption of digital media content, especially data-intensive content, may cause latency and other network performance issues. In China, most of the internet traffic goes through the networks of three carriers, China Telecom, China Unicom and China Mobile, which form the internet backbone of the country. However, major subnets are operated by different carriers in each province with limited interconnectivity Law Debenture Corporate Services Inc. 400 Madison Avenue, 4th Floor New York, New York 10017 (+1) 212-750-6474 (Name, address, including zip code, and telephone number, including area code, of agent for service) Table of Contents among the three carriers, which causes network congestion despite improving last mile access enabled by increasing bandwidth. As a result, internet users in China constantly seek advanced technologies to enhance the accessibility of internet content. Our strengths We believe the following key strengths contribute to our success and differentiate us from our competitors: Leading consumer internet platform in China; Large and loyal user base with a growing number of subscribers; Highly scalable and cost-efficient distributed computing network; Proven monetization track record; and Culture of innovation and experienced management team. Our strategies Our mission is to become the leading technology company for internet users in China to access, manage and consume digital media content through internet-enabled devices. We intend to achieve this mission by pursuing the following strategies: Continue to grow our user base and improve user engagement and retention through user experience enhancement; Further monetize our large user base; Endeavor to provide seamless cross device user access; Strengthen relationships with strategic partners to further build our ecosystem; Continue to focus on research and development and maintain our technological leadership; and Selectively pursue business expansion via partnerships and acquisitions. Our challenges Our ability to achieve our mission and execute our strategies is subject to risks and uncertainties, including but not limited to those relating to our ability to: continue developing innovative technologies in response to evolving user demand and maintain our technological leadership; maintain and further monetize our user base, expand our subscription services and grow our subscriber base; develop, maintain and protect intellectual property and other proprietary rights; license and protect third-party intellectual property rights; attract and retain qualified personnel; Copies to: Z. Julie Gao, Esq. Skadden, Arps, Slate, Meagher & Flom LLP c/o 42/F, Edinburgh Tower The Landmark 15 Queen's Road Central Hong Kong (852) 3740-4700 James C. Lin, Esq. Davis Polk & Wardwell LLP c/o 18th Floor, The Hong Kong Club Building 3A Chater Road Hong Kong (852) 2533-3300 Table of Contents maintain and develop relationships with advertisers; successfully adapt our business model to changes in our industry; and maintain control over our variable interest entities, which is based upon contractual arrangements rather than equity ownership. Our history and structure We commenced operations in January 2003 through the establishment of Shenzhen Xunlei Networking Technologies Co., Ltd., or Shenzhen Xunlei, in China. We established Xunlei Limited (formerly known as Giganology Limited) as our holding company in February 2005 in the Cayman Islands. Xunlei Limited directly owns Giganology (Shenzhen) Ltd., or Giganology Shenzhen, our wholly owned subsidiary in China established in June 2005. Giganology Shenzhen has entered into a series of contractual arrangements with Shenzhen Xunlei and its shareholders. The contractual arrangements between Giganology Shenzhen, Shenzhen Xunlei and its shareholders enable us to (1) exercise effective control over Shenzhen Xunlei; (2) receive substantially all of the economic benefits of Shenzhen Xunlei in consideration for the technical and consulting services provided and the intellectual property rights licensed by Giganology Shenzhen; and (3) have an exclusive option to purchase all of the equity interests in Shenzhen Xunlei when and to the extent permitted under laws and regulations of People's Republic of China, or PRC. As a result of these contractual arrangements, we are considered the primary beneficiary of Shenzhen Xunlei, and we treat it as our variable interest entity, or VIE, under the generally accepted accounting principles in the United States, or U.S. GAAP. We have consolidated the financial results of Shenzhen Xunlei and its subsidiaries in our consolidated financial statements in accordance with U.S. GAAP. In February 2011, we established a direct wholly owned subsidiary, Xunlei Network Technologies Limited, or Xunlei Network BVI, in the British Virgin Islands. In March 2011, we established Xunlei Network Technologies Limited, or Xunlei Network HK, in Hong Kong, which is the direct wholly owned subsidiary of Xunlei Network BVI. In November 2011, we established Xunlei Computer (Shenzhen) Co., Ltd. (also known as Thunder Computer (Shenzhen) Limited), or Xunlei Computer, in China, which is the direct wholly owned subsidiary of Xunlei Network HK. Approximate date of commencement of proposed sale to the public: as soon as practicable after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. (1) Shenzhen Xunlei is our variable interest entity. Mr. Sean Shenglong Zou, our co-founder, chairman and chief executive officer, Mr. Hao Cheng, our co-founder and director, Mr. Jianming Shi, Guangzhou Shulian Information Investment Co., Ltd. and Ms. Fang Wang respectively own 76.0%, 8.3%, 8.3%, 6.7% and 0.7% of Shenzhen Xunlei's equity interests. (2) The remaining 30% of the equity interest is owned by Mr. Hao Cheng. In March 2014, we completed the first tranche of series E preferred shares financing, pursuant to which Xiaomi Ventures Limited, or Xiaomi Ventures, subscribed for 70,975,491 series E preferred shares for a total purchase price of US$200 million, or approximately US$2.8 per share. As of the date of this prospectus, Xiaomi Ventures holds approximately 27.2% of our total issued and outstanding shares on an as-converted basis. In addition, concurrent with the closing of Xiaomi Ventures' subscription, we issued warrants to Xiaomi Ventures with an exercise price of approximately US$2.8 per share. As of the date of this prospectus, Xiaomi Ventures is entitled to subscribe for up to 17,744,264 series E preferred shares upon exercise of the warrants. If we are unable to complete this offering by December 31, 2014, then such warrants are exercisable at Xiaomi Ventures' option starting from January 1, 2015 and ending on March 1, 2015. Moreover, in relation to the first tranche of series E preferred shares financing, we also issued warrants to Skyline Global Company Holdings Limited, or Skyline, with an exercise price of approximately US$2.8 per share. As of the date of this prospectus, Skyline is entitled to subscribe for up to 3,406,899 series E preferred shares upon its exercise of the warrants. Such warrants are exercisable at Skyline's option no later than the pricing date of this offering or March 1, 2015, whichever is earlier. CALCULATION OF REGISTRATION FEE Title of each class of securities to be registered Amount to be registered(2)(3) Proposed maximum offering price per share Proposed maximum aggregate offering price(2)(3) Amount of registration fee Common shares, par value US$0.00025 per share(1) 42,061,250 US$2.20 US$92,534,750 US$11,918(4) (1)American depositary shares issuable upon the deposit of the common shares registered hereby will be registered under a separate registration statement on Form F-6 (Registration No. 333-196699). Each American depositary share represents five common shares. (2)Estimated solely for the purpose of determining the amount of registration fee in accordance with Rule 457(a) under the Securities Act of 1933. (3)Includes 5,486,250 common shares that may be purchased by the underwriters pursuant to an over-allotment option. Also includes common shares initially offered and sold outside the United States that may be resold from time to time in the United States either as part of their distribution or within 40 days after the later of the effective date of this registration statement and the date the shares are first bona fide offered to the public. These common shares are not being registered for the purpose of sales outside the United States. (4)Previously paid. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to such Section 8(a), may determine. Table of Contents In April 2014, we completed the second tranche of series E preferred shares financing with new investors, including King Venture Holdings Limited, or King Venture, an affiliated investment vehicle of Kingsoft Corporation Limited. As a result, King Venture subscribed for 31,939,676 series E preferred shares for a total purchase consideration of US$90 million, or approximately US$2.8 per share, and other investors subscribed for an aggregate number of 7,097,706 series E preferred shares for a total purchase consideration of US$20 million. As of the date of this prospectus, King Venture holds approximately 12.2% of our total issued and outstanding shares on an as-converted basis. In April 2014, we repurchased shares from several existing shareholders. As of the date of this prospectus, we completed the repurchase of an aggregate number of 23,298,276 common shares and preferred shares. In June 2014, Xiaomi Ventures entered into a share purchase agreement with Joinway Investments Limited, Ceyuan Ventures I, L.P. and Ceyuan Ventures Advisors Fund, LLC, our existing preferred shareholders. Pursuant to the share purchase agreement, Xiaomi Ventures agreed to purchase common shares converted from 3,242,280 series A preferred shares and 7,077,959 series B preferred shares at a price per share equal to the initial public offering price per share concurrently with, and subject to, the completion of this offering. The preferred shares will be converted into common shares at the then effective conversion ratio of 1:1 and be sold to Xiaomi Ventures upon the completion of this offering. Xiaomi Ventures has agreed with the underwriters not to, directly or indirectly, sell, transfer or dispose of the common shares acquired from the preferred shareholders for a period of 180 days after the date of this prospectus, subject to certain exceptions. Corporate information Our principal executive offices are located at 4/F, Hans Innovation Mansion, North Ring Road, No. 9018 High-Tech Park, Nanshan District, Shenzhen, 518057, People's Republic of China. Our telephone number at this address is (86-755) 3391-2900. Our registered office in the Cayman Islands is located at the offices of Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands. Our agent for service of process in the United States is Law Debenture Corporate Services Inc. Investors should contact us for any inquiries through the address and telephone number of our principal executive offices. Our website is www.xunlei.com. The information contained on our website is not a part of this prospectus. Implications of being an emerging growth company As a company with less than US$1.0 billion in revenues for the last fiscal year, we qualify as an "emerging growth company" pursuant to the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other requirements that are otherwise applicable generally to public companies. These provisions include exemption from the auditor attestation requirement under Section 404 of the Sarbanes-Oxley Act of 2002, or Section 404, in the assessment of the emerging growth company's internal control over financial reporting. The JOBS Act also provides that an emerging growth company does not need to comply with any new or revised financial accounting standards until such date that a private company is otherwise required to Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted. PROSPECTUS (Subject to Completion) Dated June 20, 2014 7,315,000 American Depositary Shares Xunlei Limited Representing 36,575,000 common shares This is an initial public offering of American Depositary Shares, or ADSs, of Xunlei Limited, or Xunlei. We are offering 7,315,000 ADSs. Each ADS represents five common shares, par value US$0.00025 per share. We anticipate the initial public offering price of the ADSs will be between US$9.00 and US$11.00 per ADS. We have received approval for listing of our ADSs on the NASDAQ Global Select Market under the symbol "XNET." We are an "emerging growth company" under applicable U.S. federal securities laws and are eligible for reduced public company reporting requirements. Per ADS Total Initial public offering price US$ US$ Underwriting discounts and commissions US$ US$ Proceeds to Xunlei Limited, before expenses US$ US$ We have granted the underwriters an option for a period of 30 days to purchase up to an aggregate of 1,097,250 additional ADSs from us at the public offering price less underwriting discounts and commissions to cover over-allotments. The underwriters expect to deliver the ADSs to purchasers on or about , 2014. Investing in our ADSs involves a high degree of risk. See "Risk factors" beginning on page 17. Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed on the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. J.P. Morgan Citigroup Oppenheimer & Co. , 2014. Table of Contents comply with such new or revised accounting standards. However, we have elected to "opt out" of this provision and, as a result, we will comply with new or revised accounting standards as required when they are adopted for public companies. This decision to opt out of the extended transition period under the JOBS Act is irrevocable. We will remain an emerging growth company until the earliest of (a) the last day of our fiscal year during which we have total annual gross revenues of at least US$1.0 billion; (b) the last day of our fiscal year following the fifth anniversary of the completion of this offering; (c) the date on which we have, during the previous three-year period, issued more than US$1.0 billion in non-convertible debt; or (d) the date on which we are deemed to be a "large accelerated filer" under the Securities Exchange Act of 1934, as amended, or the Exchange Act, which would occur if the market value of our ADSs that are held by non-affiliates exceeds US$700 million as of the last business day of our most recently completed second fiscal quarter. Once we cease to be an emerging growth company, we will not be entitled to the exemptions provided in the JOBS Act discussed above. Table of Contents Table of Contents
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+UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 AMENDMENT NO. 1 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 AKERNA CORP. (Exact Name of Registrant as Specified in its Charter) Delaware 7374 83-2242651 (State or other jurisdiction of incorporation or organization) Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification No.) 1550 Larimer Street #246 Denver, Colorado 80202 1-888-932-6537 (Address, including zip code, and telephone number, including area code, of principal executive offices) Corporation Service Company 251 Little Falls Drive Wilmington, Delaware 19808 (302) 636-5400 (Address, including zip code, and telephone number, including area code, of agent for service) Copies to: Jason K Brenkert, Esq. Sudeep Simkhada, Esq. Dorsey & Whitney LLP 1400 Wewatta Street, Suite 400 Denver, Colorado 80202 Telephone: (303) 352-1133 Fax Number: (303) 629-3450 Faith L. Charles, Esq. Naveen Pogula, Esq. Thompson Hine LLP 335 Madison Avenue, 12th Floor New York, New York 10017 Telephone: (212) 344-5680 Facsimile: (212) 344-6101 As soon as practicable after the effective date of this Registration Statement. (Approximate date of commencement of proposed sale to the public) If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box: If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging Growth Company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of Securities Act. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission acting pursuant to said Section 8(a), may determine. The information in this prospectus is not complete and may be changed. We may not sell the securities until the Registration Statement filed with the Securities and Exchange Commission, of which this prospectus is a part, is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED JUNE 28, 2022 AKERNA CORP. Up to 27,754,649 Units, Each Unit Consisting of One Share of Common Stock and One Warrant to Purchase One Share of Common Stock Up to 27,754,649 Pre-funded Units, Each Pre-funded Unit Consisting of One Pre-funded Warrant to Purchase One Share of Common Stock and One Warrant to Purchase One Share of Common Stock Shares of Common Stock Underlying the Warrants Shares of Common Stock Underlying the Pre-Funded Warrants We are offering up to 27,754,649 units, each unit consisting of one share of common stock and one warrant to purchase one share of common stock. The offering price of the units is $ ___ per unit. The warrants included in the units have an exercise price of $ ___ per share (100% of the unit offering price), will be immediately exercisable and expire on the five year anniversary of the issuance. We are also offering to those purchasers, if any, whose purchase of units in this offering would otherwise result in such purchaser, together with its affiliates and certain related parties, beneficially owning more than 4.99% (or, at the election of the purchaser, 9.99%) of our outstanding shares of common stock immediately following the consummation of this offering, the opportunity to purchase, if any such purchaser so chooses, pre-funded units in lieu of units that would otherwise result in such purchaser s beneficial ownership exceeding 4.99% (or, at the election of the purchaser, 9.99%) of our outstanding shares of common stock. Each pre-funded unit consists of one pre-funded warrant to purchase one share of common stock and one warrant to purchase one share of common stock. The purchase price of each pre-funded unit will be equal to the price per unit being sold to the public in this offering, minus $0.0001, and the exercise price of each pre-funded warrant included in the pre-funded units will be $0.0001 per share. The pre-funded warrants included in the pre-funded units will be immediately exercisable and may be exercised at any time until all of the pre-funded warrants are exercised in full. The warrant included in the pre-funded unit is in the same form as the warrant included in the unit. For each pre-funded unit we sell, the number of units we are offering will be decreased on a one-for-one basis. The units and the pre-funded units will not be issued or certificated. The shares of common stock or pre-funded warrants, as the case may be, and the accompanying warrants can only be purchased together in this offering, but the securities contained in the units or pre-funded units will be immediately separable upon issuance and will be issued separately. The shares of common stock issuable from time to time upon exercise of the warrants and the pre-funded warrants are also being offered by this prospectus. The registration statement of which this prospectus forms a part also registers the common stock purchase warrants to be issued to the underwriter and the shares of common stock issuable upon exercise thereof. Our common stock is currently listed on the Nasdaq Capital Market under the symbol KERN. The assumed offering price in this offering is $0.3603 per unit and is based on the fact that last reported sale price of our common stock on the Nasdaq Capital Market on June 24, 2022 was $0.3603. However, the final public offering price per unit or pre-funded unit, as the case may be, in this offering will be determined between us and the underwriter in the offering, and may be at a discount to the current market price of our common stock. Therefore, the assumed public offering price of $0.3603 per unit used throughout this prospectus may not be indicative of the final offering price per unit. There is no established public trading market for the warrants or the pre-funded warrants, and we do not expect such a market to develop. In addition, we do not intend to apply for a listing of the warrants or the pre-funded warrants on any national securities exchange or other nationally recognized trading system. We are a smaller reporting company and an emerging growth company as defined under the federal securities laws and, as such, we may continue to elect to comply with certain reduced public company reporting requirements in future reports. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 6 of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit(1) Per Pre- Funded Unit Total(2) Public offering price $0.3603 $0.3602 $10,000,000 Underwriting discount and commissions(3) $0.0252 $0.0252 $699,417 Proceeds, before expenses, to us (4) $0.3351 $0.3350 $9,300,583 (1) Based on an assumed offering price of $0.3603 per unit. The final offering price per unit or pre-funded unit, as the case may be, will be determined by the Company and the underwriter in this offering and may be at a discount to the market price of the Company s common stock. (2) Assumes 27,754,649 units are issued and no pre-funded units are issued. (3) In addition to the underwriting discount above, we have also agreed to pay the underwriter a cash fee of 7% of the aggregate gross proceeds received upon the exercise of the warrants, reimburse the underwriter for certain expenses and issue warrants to the underwriter in an amount equal to 5% of the aggregate number of shares and shares issuable upon exercise of the warrants and/or pre-funded warrants. For more information, see Underwriting. (4) Because there is no minimum offering amount required as a condition to closing in this offering, the total public offering amount, underwriting discount and commissions, and proceeds to us, before expenses, are not presently determinable and may be substantially less than the total maximum offering amounts set forth above. For more information, see Plan of Distribution. The offering is being underwritten on a firm commitment basis. We have granted the underwriter a 45-day option from the date of this prospectus to purchase up to (i) 4,163,197 additional shares (in the aggregate) of our common stock and/or (ii) warrants to purchase up to 4,163,197 additional shares of our common stock and/or (iii) pre-funded warrants to purchase up to 4,163,197 additional shares of our common stock, in any combination thereof, from us solely to cover over-allotments, if any. The underwriter expects to deliver our shares to purchasers in the offering on or about , 2022. A.G.P. June , 2022 TABLE OF CONTENTS ABOUT THIS PROSPECTUS ii SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/ADSEW_ads-tec_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/ADSEW_ads-tec_prospectus_summary.txt
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+PROSPECTUS Summary 1
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+PROSPECTUS SUMMARY 1
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+This summary highlights, and is qualified in its entirety by, the more detailed information included elsewhere in this prospectus and the other documents incorporated by reference herein. This summary does not contain all of the information that may be important to you. You should carefully consider, among other things, the matters discussed in Risk Factors and Special Note Regarding Forward-Looking Statements in this prospectus and the information in our filings with the U.S. Securities and Exchange Commission, or the SEC, incorporated by reference in this prospectus. Overview Our mission is to one day end the suffering caused by neurodegenerative diseases. Unlike most other cells in the body that regularly die and are replaced as part of healthy function, mature neurons are normally resistant to cell death and generally cannot regenerate. We believe AMX0035 is the first drug candidate to show both a functional and survival benefit in a large-scale clinical trial of patients with Amyotrophic Lateral Sclerosis, or ALS. On September 29, 2022, the U.S. Food and Drug Administration, or FDA, approved AMX0035, known as RELYVRIO in the United States, for the treatment of ALS in adults, and we are preparing for commercial launch of this product. AMX0035 also received marketing authorization with conditions as ALBRIOZA by Health Canada for the treatment of ALS in June 2022, and we commenced Canadian commercial sales of ALBRIOZA in the third quarter of 2022. We submitted a Marketing Authorization Application, or MAA, to the European Medicines Agency, or EMA, in the first quarter of 2022, which was validated in the same quarter. AMX0035 is a dual UPR-Bax apoptosis inhibitor composed of sodium phenylbutyrate, or PB, and TURSO (also known as tauroursodeoxycholic acid, or TUDCA). Through the resolution of the unfolded protein response, or UPR, and by inhibiting translocation of the Bcl-2 Associated X-protein, or Bax, to the outer mitochondrial membrane, we have shown in multiple models that AMX0035 can keep neurons alive under a variety of different conditions and stresses, including in in vitro models of neurodegeneration, endoplasmic reticulum stress, mitochondrial dysfunction, oxidative stress and disease-specific models of a variety of other conditions, as well as in vivo models of Alzheimer s Disease, or AD, and multiple sclerosis. We are pursuing ALS as our first indication as it is a disease of rapid and profound neurodegeneration, and we are focused on the development and potential commercialization of AMX0035 for ALS globally. We believe AMX0035 has the potential to be a foundational therapy, meaning that it could be used alone or in conjunction with other therapies, to change the treatment paradigm across a broad range of neurodegenerative diseases. In November 2021, we initiated a global Phase 3 clinical trial of AMX0035 for the treatment of ALS, known as the PHOENIX trial, at clinical trial sites in the United States and Europe. Enrollment in this trial was completed in March 2022 in the United States and remains ongoing in Europe. We anticipate topline results from the PHOENIX trial in 2024. This trial is designed to provide further data evaluating the safety and efficacy of AMX0035 for the treatment of ALS and to further support our global regulatory efforts and approvals. In July 2022, we announced a planned open label extension, or OLE, for the PHOENIX trial, which will allow all participants who complete the PHOENIX trial, regardless of original treatment assignment, to receive AMX0035 following the trial. In March 2022, we announced the launch of an expanded access program, or EAP, in the United States that the FDA has authorized for people with ALS who meet eligibility criteria for participation. The EAP will be wound down alongside the commercial launch of RELYVRIO in the United States. The FDA approval on September 29, 2022 of AMX0035 as RELYVRIO for the treatment of ALS in adults was granted following the second virtual meeting of the FDA s Peripheral and Central Nervous System Drugs Advisory Committee, or the Advisory Committee, held on September 7, 2022. Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject To Completion. Dated October 4, 2022. 6,000,000 Shares Common Stock We are offering 6,000,000 shares of our common stock. Our common stock is listed on the Nasdaq Global Select Stock Market, or Nasdaq, under the symbol AMLX. On October 3, 2022, the last reported sale price of our common stock, as reported on Nasdaq, was $29.75 per share. The final public offering price will be determined through negotiation between us and the lead underwriters in the offering, and the recent market price used throughout the prospectus may not be indicative of the actual offering price. We are an emerging growth company as defined under U.S. federal securities laws and, as such, will be subject to reduced public company reporting requirements for this prospectus and future filings. Investing in our common stock involves risks. See Risk Factors beginning on page 13 of this prospectus and under similar headings in documents incorporated by reference into this prospectus to read about factors you should consider before buying shares of our common stock. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities nor passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. Per Share Total Public offering price $ $ Underwriting discounts(1) $ $ Proceeds, before expenses, to Amylyx Pharmaceuticals, Inc. $ $ (1) See the section titled Underwriting for a description of the compensation payable to the underwriters. The underwriters have the option to purchase up to an additional 900,000 shares from us at the price to the public less the underwriting discount. The underwriters expect to deliver the shares against payment in New York, New York on or about , 2022. Goldman Sachs & Co. LLC BofA Securities SVB Securities Evercore ISI H.C. Wainwright & Co. Prospectus dated , 2022 Table of Contents The Advisory Committee initially met on March 30, 2022 and voted 4 (yes) and 6 (no) on the question of whether the data from our randomized, controlled Phase 2 CENTAUR trial and OLE established a conclusion that AMX0035 is effective in the treatment of patients with ALS. At the second meeting of the Advisory Committee, the Advisory Committee voted 7 (yes) to 2 (no) in response to the question of whether available evidence of effectiveness is sufficient to support approval of AMX0035 for the treatment of ALS, taking into account the unmet need in ALS, the status of the ongoing PHOENIX trial and the seriousness of ALS. At this meeting and the previous Advisory Committee meeting, the FDA presented concerns regarding choices of statistical models for the prespecified primary analysis and the interpretability of the survival results. In both Advisory Committee meetings, we presented scientific arguments and analyses, together with experts in the field, which we believe sufficiently addressed these concerns. In describing its basis for approval, the FDA acknowledged this scientific debate but concluded that the data met the substantial evidence standard, noting the limitations of exploratory and post hoc analyses. As a result of the FDA s approval of AMX0035 for the treatment of ALS in adults, we are preparing for a commercial launch of RELYVRIO in the United States. We are also developing AMX0035 for other neurodegenerative diseases by leveraging our deep knowledge of and relationships in the neurodegenerative space. We believe the approach of a dual UPR-Bax apoptosis inhibitor designed to help keep neurons alive could be clinically meaningful for the treatment of other neurodegenerative disease indications in addition to ALS. Many common and rare neurodegenerative diseases are characterized by substantial neuronal cellular loss, including AD and Wolfram syndrome, as well as Parkinson s Disease, Huntington s Disease, Progressive Supranuclear Palsy, Multi-System Atrophy, and others. We conducted a Phase 2 clinical trial in AD, known as the PEGASUS trial, to obtain safety data along with initial efficacy and biomarker data which could help us prioritize additional indications to pursue with AMX0035. We believe the topline results from the PEGASUS trial, reported in November 2021, provide further biological knowledge about AMX0035 which will help inform future clinical development of AMX0035 for the treatment of AD and in other potential indications. Based on these topline results, AMX0035 met the PEGASUS trial s primary endpoint of safety and tolerability. The 6-month trial was not powered to evaluate differences between groups in efficacy outcomes and no differences were seen in a newly developed composite outcome of cognitive, functional, and imaging measures, or in secondary efficacy endpoints of cognition, function, and imaging. In this trial, AMX0035 showed significant effects on biomarkers including neurogranin, YKL-40 or Chitinase 3-like 1 (CHI3L1), and fatty acid binding protein 3 (FABP3). These results build on previously reported findings that AMX0035 exhibited significant effects on the total tau protein, tau phosphorylated at threonine 181, 8-hydroxy-2 deoxyguanosine, or 8-OHdG, and the amyloid beta 42 to 40 (amyloid- 1-42, amyloid- 1-40) ratio in cerebrospinal fluid. We will continue to evaluate these data and discuss the results of the PEGASUS trial with scientific advisors as we consider potential next steps for the development of AMX0035 for the treatment of AD within our clinical development strategy. Based on preclinical evidence, we are continuing to evaluate plans to explore the use of AMX0035 in patients with Wolfram syndrome. We intend to prioritize our development efforts around neurodegenerative diseases that result in substantial disability, and ultimately death, and where unmet medical needs are greatest. Neurodegeneration represents one of today s most significant unmet medical needs. The development of therapies that preserve neuron health has historically presented unique challenges, including an imperfect understanding of underlying biology and a lack of translation of activity observed in preclinical studies to results in clinical trials. Currently approved therapies for many neurodegenerative diseases are generally only symptom modifying and have demonstrated limited efficacy. There remains an urgent need for novel approaches to address most neurodegenerative diseases, especially for progressive and severe conditions such as ALS. Since our founding in 2013, our goal has been to improve the quality of, and extend, life for patients suffering from neurodegenerative diseases. One of our key strategies towards achieving this goal has been to form direct relationships with patients, their families, advocacy groups, and healthcare Table of Contents professionals to bring much needed innovation to patients. Throughout the development of AMX0035, we have partnered with members of the disease communities we serve, including the ALS Association, the Northeast ALS Consortium, or NEALS, ALS Finding a Cure, the Healey Center at Massachusetts General Hospital, the Cure Alzheimer s Fund, the Alzheimer s Association and the Alzheimer s Drug Discovery Foundation, to ensure our goals are aligned with patient needs. In addition, many of the key opinion leaders in the ALS community were and are investigators in our recent and ongoing trials. These relationships are a cornerstone of our culture and corporate strategy. Pipeline Overview AMX0035 is a proprietary oral fixed-dose combination of two small molecules: PB, which is a small molecular chaperone that reduces the UPR, preventing cell death resulting from the UPR, and TURSO, which is a Bax inhibitor that reduces cell death through apoptosis. While the PB and TURSO molecules individually are not proprietary to us, we own patents and patent applications covering AMX0035, including the fixed-dose combination of AMX0035 itself. We believe that our proprietary combination of these two molecules will allow us to target abnormal cell death to better prevent neurodegeneration than treatment with either mechanism of action alone. Our current pipeline, including the stage of development and approvals of AMX0035 in our target indications, is represented in the table below. The results of our CENTAUR trial were published in September 2020 in the New England Journal of Medicine and in October 2020 in the Journal of Muscle and Nerve. Trial results showed that patients receiving AMX0035 experienced statistically significant benefit in retention of function, as measured by the Revised ALS Functional Rating Scale, or ALSFRS-R, as well as nominally significant improvement in overall survival, or OS, when analyzing the full randomized population through the OLE trial in a post hoc analysis (July 20, 2020 and March 1, 2021 data cutoffs). AMX0035 was shown to be generally well-tolerated with the prevalence of adverse events comparable across placebo and treatment groups. We believe AMX0035 is the first drug candidate in ALS to demonstrate a statistically significant benefit in function as measured by a prespecified mean rate change in ALSFRS-R and a nominally significant benefit in a longer-term post hoc analysis of OS, which are both important outcomes for people with ALS. Table of Contents Our Strategy Our mission is to one day end the suffering caused by neurodegenerative diseases. Key elements of our strategy to achieve this mission include: Effectively and efficiently commercializing RELYVRIO for ALS in the United States and ALBRIOZA for ALS in Canada. Obtaining additional regulatory approvals of AMX0035 for ALS, with an initial focus on Europe. Effectively and efficiently commercializing AMX0035 in other key territories, if approved. Maximizing the therapeutic potential of AMX0035 by expanding into additional neurodegenerative diseases. Continuing to cultivate a network of patient advocacy groups, key opinion leaders, research institutions, and healthcare professionals to inform our patient-centric approach. Deploying a strategic approach to design, acquire and develop new therapies. Our Company and Team Amylyx was founded with the ambitious goal of improving the quality and length of life for patients suffering from neurodegenerative diseases. From a dorm room at Brown University in 2013, our Co-CEOs and Co-Founders, Josh Cohen and Justin Klee set out to determine why neurons die, and have ever since been working to develop AMX0035, which we believe is the first drug candidate to show a function and survival benefit in patients with ALS, and other novel therapies. To help realize our goal, we have assembled a team with deep scientific, clinical, business and leadership experience, bolstered by expertise in biotechnology. Our Chief Financial Officer, James Frates, brings over 20 years of experience as the Chief Financial Officer of Alkermes. Our Chief Commercial Officer, Margaret Olinger, brings three decades of expertise in commercial launches and operations, most recently at Alexion. Our Chief Technical Operations Officer, Tom Holmes, brings more than 25 years of leadership experience at Biogen in supply chain, pharmaceutical manufacturing and program management. Our Chief Medical Officer, Patrick D. Yeramian, brings over 30 years of medical and pharmaceutical industry experience. Our Head of Regulatory Affairs, Tammy Sarnelli, brings more than 30 years of experience from Biogen and other companies in early and late-stage neurology and rare disease development. Our Chief Human Resources Officer, Debra Canner, brings over 30 years of experience, having served as the Chief of Human Resources Officer at Akamai and as part of Genzyme. Our Chief Legal Officer and General Counsel, Gina M. Mazzariello, brings more than 20 years of corporate and commercial legal experience in the healthcare industry, including holding leadership positions at Boehringer Ingelheim USA, Inc. This team brings a diverse set of skills uniquely suited to drive successful commercialization of AMX0035 in ALS while continuing to advance AMX0035 in other indications. Table of Contents Risks Associated with Our Business Our business is subject to a number of risks of which you should be aware before making an investment decision. These risks are discussed more fully in the Risk Factors section of this prospectus immediately following this prospectus summary. These risks include the following: Risks Related to Our Financial Position and Need for Capital We have incurred significant losses since our inception. Until we are able to generate sufficient revenue from approved products, we anticipate that we will continue to incur significant losses. We have only recently obtained regulatory approval for RELYVRIO in the United States and launched ALBRIOZA in Canada and, prior to their launch, have never generated revenue from product sales. If the commercial launches of RELYVRIO in the United States and ALBRIOZA in Canada are unsuccessful, and AMX0035 is not approved in other jurisdictions or for other indications, we may never be profitable. We have a limited operating history and our only product, AMX0035, has only recently been approved by the FDA in the United States and only recently received marketing authorization with conditions in Canada, which may make it difficult to evaluate the prospects for our future viability. Risks Related to Commercialization of AMX0035 or Future Product Candidates We have limited experience as a commercial company and we may not be successful in commercializing AMX0035 or any future product candidates in the United States, Canada or anywhere else, if and when approved, and we may be unable to generate meaningful product revenue. AMX0035 may fail to achieve the degree of market acceptance by physicians, patients, third-party payors and others in the medical community necessary for commercial success, in which case we may not generate significant revenues or become profitable. If the FDA, Health Canada, the EMA or other comparable foreign regulatory authorities approve generic versions of AMX0035 or any future product candidate of ours that receives regulatory approval, or such authorities do not grant our products appropriate periods of non-patent exclusivity before approving generic versions of such products, the sales of such products could be adversely affected. Healthcare insurance coverage and reimbursement, both from public drug plans and private health care insurers, may be limited or unavailable for RELYVRIO in the United States and ALBRIOZA in Canada, and for AMX0035 and any future product candidates, if approved anywhere else, which could make it difficult for us to sell any product candidates or therapies profitably. Risks Related to the Discovery and Development of Our Current or Future Product Candidates We currently depend on the success of AMX0035. If we are unable to maintain, or obtain additional, regulatory approvals for, and successfully commercialize, AMX0035, or experience significant delays in doing so, our business may be materially harmed. The delay or denial of regulatory approval, inability to maintain regulatory approval, inability to complete post-marketing requirements, or the requirement to resubmit any marketing application with additional data or information for AMX0035 in any jurisdiction could mean that we need to delay or even cease operations, and a delay in obtaining or inability to maintain such approval would delay commercialization of AMX0035 and adversely impact our ability to generate revenue, our business and our results of operations. Table of Contents AMX0035 is a fixed-dose combination drug product and certain regulatory authorities may require a demonstration that each component makes a contribution to the claimed effects in addition to demonstrating that the combination is safe and effective for the intended population. We have concentrated our research and development efforts on the treatment of neurodegenerative and central nervous system, or CNS, disorders, a field that has seen very limited success in product development. The regulatory approval processes of the FDA, Health Canada, the EMA and other comparable foreign authorities are lengthy, time-consuming and inherently unpredictable, and if we are ultimately unable to obtain or maintain regulatory approval for AMX0035 or any future product candidates, our business will be substantially harmed. Any finding that our global Phase 3 PHOENIX trial is insufficient to support current or additional marketing authorizations in ALS could lead the FDA or Health Canada to withdraw prior regulatory approvals for RELYVRIO or ALBRIOZA, respectively, or we could decide, after consultation with regulatory authorities, to voluntarily withdraw RELYVRIO or ALBRIOZA from the marketplace. Competitive products may reduce or eliminate the commercial opportunity for AMX0035 for our current or future indications. If our competitors develop technologies or product candidates more rapidly than we do, or their technologies or product candidates are more effective or safer than ours, our ability to develop and successfully commercialize AMX0035 may be adversely affected. Risks Related to Our Dependence on Third Parties We have entered and may in the future enter into collaborations with third parties for the development and commercialization of AMX0035 or any future product candidates, and our prospects with respect to those product candidates will depend in significant part on the success of those collaborations. Our use of third parties to manufacture AMX0035 and approved products in compliance with current good manufacturing practices may increase the risk that we will not have sufficient cGMP-compliant quantities of AMX0035, products, or necessary quantities of such materials on time or at an acceptable cost. Risks Related to Our Intellectual Property Our commercial success depends on our ability to protect our intellectual property and proprietary technology and to achieve data and market exclusivities in applicable markets. Risks Related to Our Business Operations, Employee Matters and Managing Growth A pandemic, epidemic, or outbreak of an infectious disease, such as the ongoing and evolving COVID-19 pandemic, may materially and adversely affect our business, including our preclinical studies, clinical trials, third parties on whom we rely, our supply chain, our ability to raise capital, our ability to conduct regular business and our financial results. We depend heavily on our executive officers, principal consultants and others, and the loss of their services would materially harm our business. Risks Related to Our Common Stock and This Offering If you purchase shares of our common stock in this offering, you will incur immediate and substantial dilution. Unstable market, economic, political and geographical conditions may have serious adverse consequences on our business, financial condition and stock price. Table of Contents Our Corporate Information We were incorporated under the laws of the State of Delaware on January 10, 2014 under the name Amylyx Pharmaceuticals, Inc. Our executive offices are located at 43 Thorndike Street, Cambridge, Massachusetts 02141, and our telephone number is (617) 682-0917. Our website address is www.amylyx.com. The information contained on, or that can be accessed through, our website is not a part of this prospectus. We have included our website address in this prospectus solely as an inactive textual reference. Implications of Being an Emerging Growth Company and a Smaller Reporting Company As a company with less than $1.235 billion of revenue during our last fiscal year, we qualify as an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. We would cease to be an emerging growth company on the date that is the earliest of (i) the last day of the fiscal year in which we have total annual gross revenues of $1.235 billion or more; (ii) the last day of our fiscal year following the fifth anniversary of the date of the completion of our initial public offering, or IPO; (iii) the date on which we have issued more than $1.0 billion in nonconvertible debt during the previous three years; or (iv) the date on which we are deemed to be a large accelerated filer under the rules of the SEC. For so long as we remain an emerging growth company, we are permitted and intend to rely on exemptions from certain disclosure and other requirements that are applicable to other public companies that are not emerging growth companies. These exemptions include: only two years of audited financial statements in addition to any required unaudited interim financial statements with correspondingly reduced Management s Discussion and Analysis of Financial Condition and Results of Operations disclosure; reduced disclosure about our executive compensation arrangements; no non-binding advisory votes on executive compensation or golden parachute arrangements; and exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting. In particular, we have not included or incorporated herein all of the executive compensation-related information that would be required if we were not an emerging growth company. Accordingly, the information contained or incorporated herein may be different than the information you receive from other public companies in which you hold stock. We have elected not to opt out of the exemption for the delayed adoption of certain accounting standards and, therefore, we will adopt new or revised accounting standards only at the time private companies adopt the new or revised accounting standard and will do so until such time that we either (i) irrevocably elect to opt out of such extended transition period or (ii) no longer qualify as an emerging growth company. We are also a smaller reporting company , meaning that the market value of our stock held by non-affiliates is less than $700 million and our annual revenue was less than $100 million during the most recently completed fiscal year. We may continue to be a smaller reporting company if either (i) the market value of our stock held by non-affiliates is less than $250 million or (ii) our annual revenue was less than $100 million during the most recently completed fiscal year and the market value of our stock held by non-affiliates is less than $700 million. If we are a smaller reporting company at the time we cease to be an emerging growth company, we may continue to rely on exemptions from certain disclosure requirements that are available to smaller reporting companies. Specifically, as a Table of Contents smaller reporting company we may choose to present only the two most recent fiscal years of audited financial statements in our annual reports on Form 10-K and, similar to emerging growth companies, smaller reporting companies have reduced disclosure obligations regarding executive compensation. Table of Contents
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@@ -0,0 +1,286 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary highlights certain information about us, the Private Placement and selected information contained elsewhere in or incorporated
+by reference into this prospectus. This summary is not complete and does not contain all of the information that you should consider
+before making an investment decision. For a more complete understanding of our company, you should read and consider carefully the more
+detailed information included or incorporated by reference in this prospectus and any applicable prospectus supplement, including the
+factors described under the heading "Risk Factors" on page 4 of this prospectus, as well as the information incorporated
+herein by reference, before making an investment decision. 
+
+ 
+
+Overview
+
+ 
+
+We
+are a clinical-stage biotechnology company developing novel solutions for people suffering from acute cannabinoid intoxication ("ACI")
+and substance addiction. Our lead product candidate, ANEB-001, is intended to rapidly reverse the negative effects of ACI within one
+hour of administration. The signs and symptoms of ACI range from profound sedation to anxiety and panic to psychosis with hallucinations.
+There is no approved medical treatment currently available to specifically alleviate the symptoms of ACI. If approved by the U.S. Food
+and Drug Administration ("FDA"), we believe ANEB-001 has the potential to be the first FDA approved treatment of its kind
+on the market for reversing the effects of THC, the principal psychoactive constituent of cannabis. Clinical trials completed to date
+have shown that ANEB-001 is rapidly absorbed, well tolerated and when administered to obese subjects leads to weight loss, an effect
+that is consistent with central CB1 antagonism. We initiated a Phase 2 proof-of-concept clinical trial in the Netherlands in December
+2021. We received initial topline data from Part A of the study on June 29, 2022 and announced the results on July 5, 2022.
+
+ 
+
+ACI
+episodes have become a widespread health issue in the United States, particularly in the increasing number of states that have legalized
+cannabis for medical and recreational use. The ingestion of large quantities of THC is a major cause of ACI. Excessive ingestion of THC
+via edible products such as candies and brownies, and intoxication from synthetic cannabinoids (also known as "synthetics,"
+"K2" or "spice"), are two leading causes of THC-related emergency room visits. Synthetic cannabinoids are analogous
+to fentanyl for opioids insofar as they are more potent at the cannabinoid receptor than their natural product congener THC. In recent
+years, hospital emergency rooms across the United States have seen a dramatic increase in patient visits with cannabis-related conditions.
+Before the legalization of cannabis, an estimated 450,000 patients visited hospital emergency rooms annually for cannabis-related conditions.
+In 2014, this number more than doubled to an estimated 1.1 million patients, according to data published in "Trends and Related
+Factors of Cannabis-Associated Emergency Department Visits in the United States: 2006-2014," Journal of Addiction Medicine (May/June
+2019), which provided a national estimate analyzing data from The Nationwide Emergency Department Sample ("NEDS"), the largest
+database of U.S. hospital-owned emergency department visits. Based on our own analysis of the most recent NEDS data, we believe that
+the number of hospitalizations grew to 1.74 million patients in 2018 and was growing at an approximately 15% compounded annual growth
+rate between 2012 and 2018. We believe the number of cannabis-related hospitalizations and other health problems associated with ACIs
+such as depression, anxiety and mental disorders will continue to increase substantially as more states pass laws legalizing cannabis
+for medical and recreational use. Given the consequences, there is an urgent need for a treatment to rapidly reverse the symptoms of
+ACI.
+
+ 
+
+Our
+objective is to develop new treatment options for patients suffering from ACI and substance addiction. Our lead product candidate is
+ANEB-001, a potent, small molecule cannabinoid receptor antagonist, to address the unmet medical need for a specific antidote for ACI.
+ANEB-001 is an orally bioavailable, rapidly absorbed treatment that we anticipate will reverse the symptoms of ACI, in most cases within
+1 hour of administration. Our proprietary position in the treatment of ACI is protected by rights to two patent applications covering
+various methods of use of the compound and delivery systems.
+
+ 
+
+ 1
+
+ 
+
+ 
+
+ 
+
+Corporate
+Information 
+
+ 
+
+We
+were incorporated in Delaware in April 2020. Our principal executive offices are located at 1415 Ranch Road 620 South, Suite 201, Lakeway,
+Texas 78734, and our telephone number is 512-598-0931. Our
+corporate website address is www.anebulo.com. Information contained on or accessible through
+our website is not a part of this prospectus, and the inclusion of our website address in this prospectus is an inactive textual reference
+only.
+
+ 
+
+Private
+Placement 
+
+ 
+
+On
+September 25, 2022, we entered into a Securities Purchase Agreement (the "Purchase Agreement") with the selling stockholders
+named in this prospectus, pursuant to which we sold and issued to the selling stockholders 2,264,650 units (collectively, the "Units"),
+with each Unit consisting of (i) one share of our common stock and (ii) a warrant to purchase one share of our common stock, for an aggregate
+purchase price of approximately $6.6 million (or $2.935 per Unit). The closing of the Private Placement occurred on September 28, 2022.
+Each warrant has an exercise price of $4.215 per share, which is subject to customary adjustments in the event of any combination or
+split of our common stock, and has a five-year term. The warrants contain beneficial ownership limitations which prevent the holder from
+exercising the warrant if immediately following such exercise the holder would beneficially own shares of our common stock in excess
+of the stated beneficial ownership limitation.
+
+ 
+
+22NW
+Fund, LP, a fund affiliated with Aron R. English, a director of the Company and the second largest beneficial owner of common stock,
+participated in the Private Placement and purchased 1,703,577 Units at the per Unit purchase price, for an aggregate purchase price of
+approximately $5.0 million.
+
+ 
+
+Under
+the terms of the Purchase Agreement, we agreed to prepare and file a registration statement with the SEC on or before November 2, 2022
+to register the resale of the shares of our common stock issued under the Purchase Agreement, and the shares of our common stock issuable
+upon exercise of the warrants issued under the Purchase Agreement, and to cause the registration statement to become effective as promptly
+as possible after the filing thereof, but in any event
+prior to the date which is five days after the receipt of a notification of no-review in the event of no review by the SEC, or 90 days
+after the filing thereof in the event of a review by the SEC.
+
+ 
+
+Implications
+of Being and Emerging Growth Company and Smaller Reporting Company
+
+ 
+
+We
+qualify as an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2012. An emerging growth
+company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies.
+These provisions include:
+
+ 
+
+ 
+ 
+ 
+ an
+ exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting pursuant to
+ the Sarbanes-Oxley Act of 2002;
+
+ 
+ 
+ 
+ an
+ exemption from implementation of new or revised financial accounting standards until they would apply to private companies and from
+ compliance with any new requirements adopted by the Public Company Accounting Oversight Board requiring mandatory audit firm rotation;
+
+ 
+ 
+ 
+ reduced
+ disclosure obligations regarding executive compensation arrangements; and
+
+ 
+ 
+ 
+ no
+ requirement to seek nonbinding advisory votes on executive compensation or golden parachute arrangements.
+
+ 
+ 
+
+We
+may take advantage of some or all these provisions until we are no longer an emerging growth company. We will remain an emerging growth
+company until the earlier to occur of (1) (a) June 30, 2026, which is the end of the fiscal year following the fifth anniversary of the
+completion of our initial public offering, (b) the last day of the fiscal year in which we have total annual gross revenues of at least
+$1.235 billion or (c) the last day of the fiscal year in which we are deemed to be a "large accelerated filer" under the
+rules of the SEC, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior
+December 31st, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.
+
+ 
+
+Finally,
+we are a "smaller reporting company" (and may continue to qualify as such even after we no longer qualify as an emerging
+growth company) and accordingly may provide less public disclosure than larger public companies, including the inclusion of only two
+years of audited financial statements and only two years of related management s discussion and analysis of financial condition
+and results of operations disclosure. As a result, the information that we provide to our stockholders may be different than you might
+receive from other public reporting companies in which you hold equity interests.
+
+ 
+
+ 2
+
+ 
+
+ 
+
+ 
+
+The
+Offering
+
+ 
+
+ 
+ Common
+ stock offered by the selling stockholders 
+ 4,529,300
+ shares(1)
+
+ 
+ 
+ 
+
+ 
+ Terms
+ of the offering 
+ Each
+ selling stockholder will determine when and how it will sell the common stock offered in this prospectus, as described in "Plan
+ of Distribution." 
+
+ 
+ 
+ 
+
+ 
+ Use
+ of proceeds 
+ We
+ will not receive any proceeds from the sale of the shares of common stock covered by this prospectus. 
+
+ 
+ 
+ 
+
+ 
+ Risk
+ Factors 
+ See
+ "Risk Factors" on page 4, for a discussion of factors you should carefully consider before deciding to invest in our
+ common stock. 
+
+ 
+ 
+ 
+
+ 
+ Nasdaq
+ Capital Market symbol 
+ ANEB
+
+ 
+ 
+
+ 
+ (1)
+ Includes
+ 2,264,650 shares of common stock held by the selling stockholders named in this prospectus and 2,264,650 shares of common stock issuable
+ upon exercise of warrants held by the selling stockholders named in this prospectus. 
+
+ 
+ 
+
+The
+selling stockholders named in this prospectus may offer and sell up to 4,529,300 shares of our common stock. Our common stock is currently
+listed on The Nasdaq Capital Market under the symbol "ANEB." Shares of our common stock that may be offered under this prospectus
+will be fully paid and non-assessable. We will not receive any of the proceeds of sales by the selling stockholders of any of the common
+stock covered by this prospectus. We will, however, receive the net proceeds of any exercise of the warrants. Throughout this prospectus,
+when we refer to the shares of our common stock being registered on behalf of the selling stockholders for offer and resale, we are referring
+to the shares of common stock that have been issued to the selling stockholders and the shares of common stock issuable upon exercise
+of warrants issued in the Private Placement as described above. When we refer to the selling stockholders in this prospectus, we are
+referring to the selling stockholders identified in this prospectus and, as applicable, their permitted transferees or other successors-in-interest
+that may be identified in a supplement to this prospectus or, if required, a post-effective amendment to the registration statement of
+which this prospectus is a part.
+
+ 
+
+ 3
+
+ 
+
+ 
+
+ 
+
+RISK
+FACTORS
+
+ 
+
+Investing
+in our common stock involves a high degree of risk. Before making an investment decision, you should carefully consider the risks described
+in the sections entitled "Risk Factors" in our most recent Annual Report on Form 10-K, as filed with the SEC, which is incorporated
+herein by reference, as well any amendment or updates to our risk factors reflected in subsequent filings with the SEC, including any
+applicable prospectus supplement. Our business, financial condition, results of operations or prospects could be materially adversely
+affected by any of these risks. The trading price of our securities could decline due to any of these risks, and you may lose all or
+part of your investment. This prospectus and the documents incorporated herein by reference also contain forward-looking statements that
+involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements
+as a result of certain factors, including the risks mentioned elsewhere in this prospectus. For more information, see the section entitled
+"Where You Can Find Additional Information." Please also read carefully the section entitled "
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/ANGHW_anghami_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/ANGHW_anghami_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..bbb9e93908aeda22d89d29d445badf10c612c169
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/ANGHW_anghami_prospectus_summary.txt
@@ -0,0 +1,9380 @@
+summary financial data for Anghami s business. This information is only a summary and should be read in conjunction with the section entitled Management s Discussion and Analysis of Financial Condition and Results of Operations and Anghami s audited financial statements, and the notes related thereto, which are included elsewhere in this prospectus. Anghami s historical results are not necessarily indicative of future results.
+
+ Anghami s statement of financial position data as of December 31, 2021 and December 31, 2020 and statement of comprehensive income data for the years ended December 31, 2021, 2020 and 2019 are derived from Anghami s audited consolidated financial statements included elsewhere in this prospectus.
+
+ All numbers given below are in US dollars except for the number of shares outstanding. Certain amounts that appear in this section may not sum due to rounding.
+
+ 
+
+ 
+ 
+
+ Statement of comprehensive income data
+
+ 
+ 
+ 
+ Year Ended 
+December 31, 
+2021
+
+ 
+ 
+ 
+ Year Ended
+December 31, 2020
+
+ 
+ 
+ 
+ Year Ended
+December 31, 2019
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+
+ 
+ 
+ Revenue
+
+ 
+ 
+ 
+ 35,504,392
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 30,518,356
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 31,227,649
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Cost of revenue
+
+ 
+ 
+ 
+ (26,462,637
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (22,346,521
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (21,321,616
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Gross profit
+
+ 
+ 
+ 
+ 9,041,755
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 8,171,835
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 9,906,033
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Selling and marketing expenses
+
+ 
+ 
+ 
+ (8,013,933
+
+ 
+ 
+ ) 
+
+ 
+ 
+ 
+ (5,284,152
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (8,232,405
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ General and administrative expenses
+
+ 
+ 
+ 
+ (17,138,259
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (5,435,996
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (6,923,949
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Government grants
+
+ 
+ 
+ 
+ 2,546,360
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Operating loss
+
+ 
+ 
+ 
+ (13,564,077
+
+ 
+ 
+ ) 
+
+ 
+ 
+ 
+ (2,548,313
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (5,250,321
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Net finance cost and others
+
+ 
+ 
+ 
+ (4,146,227
+
+ 
+ 
+ ) 
+
+ 
+ 
+ 
+ (2,693,639
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (1,057,107
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Loss before tax
+
+ 
+ 
+ 
+ (17,710,304
+
+ 
+ 
+ ) 
+
+ 
+ 
+ 
+ (5,241,952
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (6,307,428
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Income tax
+
+ 
+ 
+ 
+ (340,003
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (501,238
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (638,965
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Total Comprehensive Loss for the 
+period
+
+ 
+ 
+ 
+ (18,050,307
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (5,743,190
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (6,946,393
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Basic and diluted loss per share attributable to equity holders of the parent
+
+ 
+ 
+ 
+ (206.90
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (68.27
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (83.05
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Weighted average shares outstanding basic and diluted
+
+ 
+ 
+ 
+ 85,966
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 81,823
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 81,222
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+
+ Statement of financial position data
+
+ 
+ 
+ 
+ As of December 31, 2021
+
+ 
+ 
+ 
+ As of December 31, 2020
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+
+ 
+ 
+ Total assets
+
+ 
+ 
+ 
+ 13,025,327
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 14,257,298
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Total liabilities
+
+ 
+ 
+ 
+ 40,988,748
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 32,170,171
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Deficiency of assets
+
+ 
+ 
+ 
+ (27,963,421
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (17,912,873
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+
+ 9
+
+ Table of Contents
+
+ 
+ CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
+
+ Certain statements in this prospectus may constitute forward-looking statements for purposes of the federal securities laws. Our forward-looking statements include, but are not limited to, statements regarding our or our management team s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words anticipate, believe, continue, could, estimate, expect, intends, may, might, plan, possible, potential, predict, project, should, would and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this prospectus may include, for example, statements about:
+
+ our growth strategy, future operations, financial position, estimated revenues and losses, projected capex, prospects and plans;
+
+ our strategic advantages and the impact those advantages will have on future financial and operational results;
+
+ the implementation, market acceptance and success of our platform and new offerings;
+
+ our approach and goals with respect to technology;
+
+ our expectations regarding our ability to obtain and maintain intellectual property protection and not infringe on the rights of others;
+
+ the impact of the COVID-19 pandemic on our business;
+
+ changes in applicable laws or regulations; and
+
+ the outcome of any known and unknown litigation and regulatory proceedings.
+
+ We caution you against placing undue reliance on forward-looking statements, which reflect current beliefs and are based on information currently available as of the date a forward-looking statement is made. Forward-looking statements set forth herein speak only as of the date of this prospectus. We do not undertake any obligation to revise forward-looking statements to reflect future events, changes in circumstances, or changes in beliefs. In the event that any forward-looking statement is updated, no inference should be made that we will make additional updates with respect to that statement, related matters, or any other forward-looking statements. Any corrections or revisions and other important assumptions and factors that could cause actual results to differ materially from forward-looking statements, including discussions of significant risk factors, may appear, in our public filings with the SEC, which are or will be (as appropriate) accessible at www.sec.gov, and which you are advised to consult. For additional information, please see the section titled Where You Can Find More Information in this prospectus.
+
+ Market, ranking and industry data used throughout this prospectus, including statements regarding market size and technology adoption rates, is based on the good faith estimates of our management, which in turn are based upon our management s review of internal surveys, independent industry surveys and publications, and other third party research and publicly available information. These data involve a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. While we are not aware of any misstatements regarding the industry data presented herein, our estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed under the heading Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations in this prospectus.
+
+ 
+
+ 10
+
+ Table of Contents
+
+ 
+ RISK FACTORS
+
+ Investing in our securities involves risks. In considering purchasing our securities, you should carefully consider the following information about these risks, as well as the other information included in this prospectus, including our consolidated financial statements and the related notes and Management s Discussion and Analysis of Results of Operations and Financial Condition. The risks and uncertainties described below are those significant risk factors, currently known and specific to us, that we believe are relevant to an investment in our securities. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also harm us and adversely affect our shares.
+
+ Risks Related to Our Business Model, Strategy, and Performance
+
+ If our efforts to attract prospective users, retain existing users, and effectively monetize our products and services are not successful, our growth prospects and revenue will be adversely affected.
+
+ Our ability to grow our business and generate revenue depends on retaining, expanding, and effectively monetizing our total user base, including by increasing the number of Premium service users and the number of users of our ad-supported service and finding ways to monetize content across the platform. We must convince prospective users of the benefits of our platform and our existing users of the continuing value of our platform. Our ability to attract new users, retain existing users, and convert Ad-Supported Free service users to Premium service users depends in large part on our ability to continue to offer exceptional technologies and products, compelling content, superior functionality, and an engaging user experience. Some of our competitors, including Apple, Google, and Amazon, have developed, and are continuing to develop, devices for which their music streaming services are preloaded, which puts us at a significant competitive disadvantage. As consumer tastes and preferences change on the internet and with mobile devices and other internet-connected products, we will need to enhance and improve our existing service, introduce new features, and maintain our competitive position with additional technological advances and an adaptable platform. If we fail to keep pace with technological advances or fail to offer compelling product offerings and state-of-the-art delivery platforms to meet consumer demands, our ability to grow or sustain the reach of our service, attract and retain users, and increase Premium service users may be adversely affected.
+
+ In addition, in order to increase advertising revenue, we also seek to increase the listening time that our Ad-Supported Free service users spend on the Ad-Supported Free service. The more content we stream under this service, the more advertising inventory we will have to sell. Generally, any increase in Ad-Supported Free service user base increases the size and scope of user pools targeted by advertisers, which improves our ability to deliver relevant advertising to those users in a manner that maximizes our advertising customers return on investment. This, in turn, illustrates the effectiveness of our advertising solutions and justifies our pricing structure. If we fail to grow our Ad-Supported Free service user base, the amount of content streamed, and the listening time spent by these users, we may be unable to grow Ad-Supported revenue. Moreover, since we primarily source Premium service users from the conversion of our Ad-Supported Free service users, any failure to grow the Ad-Supported Free service user base or convert them to Premium service users may negatively impact our revenue.
+
+ We face many risks associated with our international operations.
+
+ We have significant international operations and plan to continue to grow internationally. However, managing our business and offering our products and services internationally involves numerous risks and challenges, including:
+
+ difficulties in obtaining licenses to stream content from rights organizations and individual copyright owners in countries around the world on favorable terms;
+
+ lack of well-functioning copyright collective management organizations that are able to grant us music licenses, process reports, and distribute royalties in markets;
+
+ fragmentation of rights ownership in various markets causing lack of transparency of rights coverage and overpayment or underpayment to record labels, music publishers, artists, performing rights organizations, and other copyright owners;
+
+ difficulties in obtaining license rights to local content;
+
+ 
+
+ 11
+
+ Table of Contents
+
+ 
+ increased risk of disputes with and/or lawsuits filed by rights holders in connection with our expansion into new markets; 
+
+ difficulties in achieving market acceptance of our products or services in different geographic markets with different tastes and interests;
+
+ difficulties in achieving viral marketing growth in certain other countries where we commit fewer sales and marketing resources;
+
+ difficulties in effectively monetizing our growing international user base;
+
+ difficulties in managing operations due to language barriers, distance, staffing, user behavior and spending capability, cultural differences, business infrastructure constraints, and laws regulating corporations that operate internationally;
+
+ application of different laws and regulations of other jurisdictions, including corporate governance, labor and employment, privacy, telecommunications and media, cybersecurity, content moderation, environmental, health and safety, consumer protection, liability standards and regulations, as well as intellectual property laws;
+
+ potential adverse tax consequences associated with foreign operations and revenue;
+
+ complex foreign exchange fluctuation and associated issues;
+
+ increased competition from local websites and audio content providers, some with financial power and resources to undercut the market or enter into exclusive deals with local content providers to decrease competition;
+
+ credit risk and higher levels of payment fraud;
+
+ political and economic instability in some countries;
+
+ region-specific effects of the COVID-19 pandemic;
+
+ compliance with the U.S. Foreign Corrupt Practices Act, the U.K. Bribery Act, and similar laws in other jurisdictions;
+
+ import and export controls and economic sanctions administered by the U.S. Department of Commerce s Bureau of Industry and Security and the U.S. Department of the Treasury s Office of Foreign Assets Control;
+
+ restrictions on international monetary flows; and
+
+ reduced or ineffective protection of our intellectual property rights in some countries.
+
+ If we are unable to manage the complexity of our global operations and continue to grow internationally as a result of these obstacles, our business, operating results, and financial condition could be adversely affected.
+
+ Our business emphasizes rapid innovation and prioritizes long-term user engagement over short-term financial condition or results of operations. That strategy may yield results that sometimes do not align with the market s expectations. If that happens, our stock price may be negatively affected.
+
+ Our business is growing and becoming more complex, and our success depends on our ability to quickly develop and launch new and innovative products. We believe our culture fosters this goal. Our focus on innovations and quick reactions could result in unintended outcomes or decisions that are poorly received by our users, advertisers, or partners. We have made, and expect to continue to make, significant investments to develop and launch new products, services, and initiatives, which may involve significant risks and uncertainties, including the fact that such offerings may not be commercially viable for an indefinite period of time or at all, or may not result in adequate return of capital on our investments. No assurance can be given that such new offerings will be successful and will not adversely affect our reputation, operating results, and financial condition. Our culture also prioritizes our long-term user engagement over short-term financial condition or results of operations. We frequently make 
+
+ 
+
+ 12
+
+ Table of Contents
+
+ 
+ decisions that may reduce our short-term revenue or profitability if we believe that the decisions benefit the aggregate user experience and will thereby improve our financial performance over the long term. These decisions may not produce the long-term benefits that we expect, in which case our user growth and engagement, our relationships with advertisers and partners, as well as our business, operating results, and financial condition could be seriously harmed.
+
+ We may not be able to generate sufficient revenue to be profitable, or to generate positive cash flow on a sustained basis. In addition, our revenue growth rate may decline.
+
+ If we cannot successfully earn revenue at a rate that exceeds the operational costs, including royalty and other licensing expenses, associated with our platform, we will not be able to achieve or sustain profitability or generate positive cash flow on a sustained basis.
+
+ Furthermore, we cannot assure you that the growth in revenue we have experienced over the past few years will continue at the same rate or even continue to grow at all. We expect that, in the future, our revenue growth rate may decline because of a variety of factors, including increased competition and the maturation of our business. You should not consider our historical revenue growth or operating expenses as indicative of our future performance. If our revenue growth rate declines or our operating expenses exceed our expectations, our financial performance may be adversely affected.
+
+ Additionally, we also expect our costs to increase in future periods, which could negatively affect our future operating results and ability to achieve profitability. We expect to continue to expend substantial financial and other resources on:
+
+ securing top quality audio and video content from leading record labels, distributors, aggregators, and podcast creators, as well as the publishing right to any underlying musical compositions;
+
+ creating new forms of original content;
+
+ our technology infrastructure, including website architecture, development tools, scalability, availability, performance, security, and disaster recovery measures;
+
+ research and development, including investments in our research and development team and the development of new features;
+
+ sales and marketing, including a significant expansion of our field sales organization;
+
+ international operations in an effort to maintain and increase our member base, engagement, and sales;
+
+ capital expenditures that we will incur to grow our operations and remain competitive; and
+
+ general administration, including legal and accounting expenses.
+
+ These investments may not result in increased revenue or growth in our business. If we fail to continue to grow our revenue and overall business, our business, operating results, and financial condition would be harmed.
+
+ Failure to successfully monetize and generate revenues from podcasts and other non-music content could adversely affect our business, operating results, and financial condition.
+
+ Delivering podcasts and other non-music content involves numerous risks and challenges, including increased capital requirements, competition, and the need to develop strategic relationships. Growth in these areas may require additional changes to our existing business model and cost structure, modifications to our infrastructure, and exposure to new regulatory, legal and reputational risks, including infringement liability, any of which may require additional expertise that we currently do not have. There is no guarantee that we will be able to generate sufficient revenue from podcasts or other non-music content to offset the costs of creating or acquiring this content. Failure to successfully monetize and generate revenues from such content, including failure to obtain or retain rights to podcasts or other non-music content on acceptable terms, or at all, or to effectively manage the numerous risks and challenges associated with such expansion, could adversely affect our business, operating results, and financial condition.
+
+ 
+
+ 13
+
+ Table of Contents
+
+ 
+ In addition, we enter into multi-year commitments for original content that we produce or commission. Given the multiple-year duration and largely fixed-cost nature of such commitments, if our user growth and retention do not meet our expectations, our margins may be adversely impacted. Payment terms for certain content that we produce or commission will typically require more upfront cash payments than other content licenses or arrangements whereby we do not pay for the production of such content. To the extent our user and/or revenue growth do not meet our expectations, our liquidity and results of operations could be adversely affected as a result of such content commitments. The long-term and fixed-cost nature of certain original content commitments may also limit our flexibility in planning for or reacting to changes in our business, as well as our ability to adjust our content offering if our users do not react favorably to the content we produce. Any such event could adversely impact our business, operating results, and financial condition.
+
+ To secure the rights to stream sound recordings and the musical compositions embodied therein, we enter into license agreements to obtain licenses from rights holders such as record labels, music publishers, performing rights organizations, collecting societies, and other copyright owners or their agents, and pays royalties to such parties or their agents around the world. We work diligently to obtain all necessary licenses to stream sound recordings and the musical compositions embodied therein, however, there is no guarantee that the licenses available to us now will continue to be available in the future at rates and on terms that are favorable or commercially reasonable or at all. The terms of these licenses, including the royalty rates that we are required to pay pursuant to them, may change as a result of changes in our bargaining power, changes in the industry, changes in the law, or for other reasons. Increases in royalty rates or changes to other terms of these licenses may materially impact our business, operating results, and financial condition.
+
+ We have entered into license agreements to obtain rights to stream sound recordings, including from the major international record labels who hold the rights to stream a significant number of sound recordings such as Universal Music Group, Sony Music Entertainment, and Warner Music Group, as well as regional record labels, such as Qanawat Nile Production and Stars for Art production & distribution Offshore. If we fail to retain these licenses, the size and quality of our catalogue may be materially impacted and our business, operating results, and financial condition could be materially harmed.
+
+ We generally obtain licenses for two types of rights with respect to musical compositions: mechanical rights and public performance rights. We obtain mechanical and performance licenses for musical compositions either through local collecting societies representing publishers or from publishers directly, or a combination thereof.
+
+ With respect to mechanical rights, in Algeria, Bahrain, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Morocco, Oman, Palestine, Qatar, Saudi Arabia, Sudan, Tunisia and UAE (together, our MENA Operating Area ), we pay various rights owners through a ratemaking process conducted on a case-by-case basis based on negotiating each deal. There are cases of publishing deals which are represented by bodies which combine both mechanical and public performance rights, such as SOLAR which represents mechanical rights of Sony Music Publishing and public performance rights from PRS and International Copyright Enterprise Services Limited among others. Since in many countries in the Middle East & North Africa ( MENA Region ), there are no collection societies, we cannot guarantee that our licenses with the existing few collecting societies and/or our direct licenses with publishers provide full coverage for all of the musical compositions we make available to our users in such countries. As such there is a fragmented copyright licensing landscape which leads to publishers, songwriters, and other rights holders choosing not to be represented by collecting societies and that adversely impacts our ability to secure favorable licensing arrangements in connection with musical compositions that such rights holders own or control, including increasing the costs of licensing such musical compositions, or subjecting us to significant liability for copyright infringement.
+
+ In the United States, the rates we incur for mechanical rights are a function of ratemaking procedure conducted by an administrative agency, Copyright Royalty Board. The most recent proceeding before the Copyright Royalty Board (the Phonorecords III Proceedings ) set the rates for the Section 115 compulsory license for calendar years 2018 to 2022. The Copyright Royalty Board issued its initial written determination on January 26, 2018 and set up the Mechanical Licensing Collective (the MLC ). The MLC is a nonprofit organization designated by the U.S. Copyright Office pursuant to the Music Modernization Act of 2018. In January 2021, the MLC began administering blanket mechanical licenses to eligible streaming and download services (digital service providers or DSPs) in the United States, which we opted for and obtained a blanket license for mechanical rights in the U.S. The MLC collects the royalties due under those licenses from the DSPs and pay songwriters, composers, lyricists, and music 
+
+ 
+
+ 14
+
+ Table of Contents
+
+ 
+ publishers. We currently believe that the current rates will not materially impact our business, operating results, and financial condition in the U.S. as although the U.S. is our biggest market outside of the MENA Operating Area, it is currently not a significant market. However, if we do decide to expand our business (with both Arabic and international music) in the U.S., and we do not grow in revenues and users as expected or if the rates are modified to be higher than the proposed rates, our content acquisition costs could increase and impact our ability to obtain content on pricing terms favorable, which could negatively harm our business, operating results, and financial condition and hinder our ability to provide interactive features in our services, or cause one or more of our services not to be economically viable in U.S.
+
+ In the U.S., performing rights organizations ( PROs ) generally provide public performance rights, which negotiate blanket licenses with copyright users for the public performance of compositions, collect royalties, and distribute those royalties to rights owners. The royalty rates that apply to us today may be subject to changes in the future. Licenses provided by two of these PROs, the American Society of Composers, Authors and Publishers and Broadcast Music, Inc. are governed by consent decrees which are subject to terms which could be unfavorable to us in the future. This could affect our financial viability in the future in the U.S.
+
+ We cannot guarantee that our licenses with collecting societies and our direct licenses with publishers provide full coverage for all of the musical compositions that we make available on our platform.
+
+ There also is no guarantee that we have or will have all of the licenses we need to stream content, as the process of obtaining such licenses involves many rights holders, some of whom are unknown, and myriad complex legal issues across many jurisdictions, including open questions of law as to when and whether particular licenses are needed. Additionally, there is a risk that aspiring rights holders, their agents, or legislative or regulatory bodies will create or attempt to create new rights that could require us to enter into license agreements with, and pay royalties to, newly defined groups of rights holders, some of which may be difficult or impossible to identify. See also Risk Factors Risks Related to Our Business Model, Strategy, and Performance Difficulties in obtaining accurate and comprehensive information necessary to identify the compositions embodied in sound recordings on our platform and the ownership thereof may impact our ability to perform our obligations under our licenses, affect the size of our catalogue, impact our ability to control content acquisition costs, and lead to potential copyright infringement claims. 
+
+ Further, we cannot guarantee that such agreements will continue to be renewed indefinitely. For example, from time to time, license agreements with certain rights holders and/or their agents may expire while we are still negotiating their renewals, and, per industry custom and practice, we may enter into brief contract extension (for example, month-, week-, or even days-long) and/or continue to operate as if the license agreement had been extended. During these periods, we may not have assurance of long-term access to such rights holders content, which could have a material adverse effect on our business and could lead to potential copyright infringement claims. It also is possible that such agreements will never be renewed at all. The lack of renewal, or termination, of one or more of our license agreements, or the renewal of a license agreement on less favorable terms, also could have a material adverse effect on our business, financial condition, and results of operations.
+
+ We are a party to many license agreements which are complex and impose numerous obligations upon us which may make it difficult to operate our business, and a breach of such agreements could adversely affect our business, operating results, and financial condition.
+
+ Our license agreements are primarily complex and impose numerous obligations on it, including obligations to, among other things:
+
+ meet certain user and conversion targets in order to secure certain licenses and royalty rates;
+
+ calculate and make payments based on complex royalty structures, which requires tracking usage of content on our service that may have inaccurate or incomplete metadata necessary for such calculation;
+
+ provide periodic reports on the exploitation of the content in specified formats;
+
+ represent that we will obtain all necessary publishing licenses and consents and pay all associated fees, royalties, and other amounts due for the licensing of musical compositions;
+
+ provide advertising inventory;
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+ comply with certain marketing and advertising restrictions; and
+
+ comply with certain security and technical specifications.
+
+ Some of our license agreements grant the licensor the right to audit our compliance with the terms and conditions of such agreements. Some of the license agreements also include so-called most favored nations provisions which require that certain terms (including potentially the material terms) of such agreements are no less favorable than those provided to any similarly situated licensor. If triggered, these most favored nations provisions could cause our payments or other obligations under those agreements to escalate substantially. Additionally, some license agreements require consent to undertake certain business initiatives and without such consent, our ability to undertake new business initiatives may be limited and in turn could hurt our competitive position.
+
+ If we materially breach any of these obligations or any other obligations set forth in any of the license agreements, or if we use content in ways that are found to exceed the scope of such agreements, we could be subject to monetary penalties and our rights under such license agreements could be terminated, either of which could have a material adverse effect on our business, operating results, and financial condition.
+
+ We have no control over the providers of our content, and our business may be adversely affected if the access to music is limited or delayed. The concentration of control of content by our major providers means that even one entity, or a small number of entities working together, may unilaterally affect our access to music and other content.
+
+ We rely on music rights holders, over whom we have no control, for the content we make available on our service. We cannot guarantee that these parties will always choose to license to it. The music industry has a high level of concentration, which means that one or a small number of entities may, on their own, take actions that adversely affect our business. For example, with respect to sound recordings, the music licensed to us under our agreements with Universal Music Group, Sony Music Entertainment, and Warner Music Group, constitutes a large portion of music consumed on our service. For the year ended December 31, 2021, this content accounted for approximately 33.95% of streams.
+
+ Our business may be adversely affected if our access to music is limited or delayed because of deterioration in our relationships with one or more of these rights holders or if they choose not to license to us for any other reason. Rights holders also may attempt to take advantage of their market power to seek onerous financial terms from us, which could have a material adverse effect on our financial condition and results of operations. In 2019, Rotana Audio and Video ( Rotana ) terminated their license agreement. We initiated an arbitration proceeding at the Commercial Courts in Beirut against Rotana for breach of the provisions of the license agreement. In October 2019, Rotana filed a suit against us before Beirut First Instance Court, claiming that we have been illegally distributing content owned by Rotana without a license. Rotana also initiated a legal claim against us before the Cyber Crime Bureau in September 2020, alleging that we kept some content owned by Rotana without a license.
+
+ In April 2022, both parties have dropped their lawsuits and a new licensing agreement was signed to bring back Rotana content to Anghami app.
+
+ Even if we are able to secure rights to sound recordings from record labels and other copyright owners, artists and/or artist groups may object and may exert public or private pressure on third parties to discontinue licensing rights to us, hold back content from it, or increase royalty rates. As a result, our ability to continue to license rights to sound recordings is subject to convincing a broad range of stakeholders of the value and quality of our service.
+
+ To the extent that we are unable to license a large amount of content or the content of certain popular artists, our business, operating results, and financial condition could be materially adversely affected.
+
+ Our royalty payment arrangements are complex, and it is difficult to estimate the amount payable under license agreements.
+
+ Under our license agreements, we have to pay a royalty to record labels, music publishers, and other copyright owners in order to stream content. The determination of the amount and timing of such payments is complex and subject to a number of variables, including the revenue generated, the type of content streamed and the 
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+ country in which it is streamed, the service tier such content is streamed on, identification of the appropriate license holder, size of user base, ratio of Ad-Supported Free service users to Premium service users, and any applicable advertising fees, app stores and telecom operators fees and discounts, among other variables. 
+
+ Additionally, for new licensing agreements, we have certain arrangements because of which royalty costs are paid in advance or are subject to minimum guaranteed amounts. An accrual is estimated at the higher of the actual royalty costs to be incurred during a contractual period or the minimum guarantee.
+
+ Additionally, we also have license agreements that include so-called most favored nations provisions that require that the material terms of such agreements are the most favorable material terms provided to any music licensor, which, if triggered, could cause our royalty payments under those agreements to escalate substantially. An accrual and expense is recognized when it is probable that we will make additional royalty payments under these terms. Historically, we never incurred additional provisions relating to most favored nations provisions.
+
+ Determining royalty payments is complex. As a result, we may underpay or overpay the royalty amounts payable to record labels, music publishers, and other copyright owners. Underpayment could result in (i) litigation or other disputes with record labels, music publishers, and other copyright owners, (ii) the unexpected payment of additional royalties in material amounts, and (iii) damage to business relationships with record labels, music publishers, other copyright owners, and artists and/or artist groups. If we overpay royalties, we may be unable to reclaim such overpayments, and our profits will suffer. Failure to accurately pay royalties may adversely affect our business, operating results, and financial condition.
+
+ Minimum guarantees required under certain of our license agreements for sound recordings and underlying musical compositions may limit our operations and may adversely affect our business, operating results, and financial condition.
+
+ Certain of our license agreements for sound recordings and musical compositions (both for mechanical rights and public performance rights) contain minimum guarantees and/or require that we make minimum guarantee payments. As of December 31, 2021, we had estimated future minimum guarantee commitments of $7,115,551 over the next 2 years. Such minimum guarantees related to content acquisition costs are not always tied to our number of users, Premium service users, or the number of sound recordings and musical compositions used on our service. Accordingly, our ability to achieve and sustain profitability and operating leverage on our service depends, in part, on our ability to increase revenue through increased sales of Premium service and advertising sales on terms that maintain an adequate gross margin. The duration of license agreements that contain minimum guarantees is typically between one and two years, but Premium service users may cancel their subscriptions at any time. If our forecasts of Premium service user acquisition do not meet our expectations or the number or advertising sales decline significantly during the term of the license agreements, our margins may be materially and adversely affected. To the extent Premium service revenue growth or advertising sales do not meet our expectations, our business, operating results, and financial condition also could be adversely affected as a result of such minimum guarantees. In addition, the fixed cost nature of these minimum guarantees may limit our flexibility in planning for, or reacting to, changes in our business and the market segments in which we operate.
+
+ We rely on estimates of the market share of licensable content controlled by each content provider, as well as its own user growth and forecasted advertising revenue, to forecast whether such minimum guarantees could be recouped against our actual content acquisition costs incurred over the duration of the license agreement. To the extent that these revenue and/or market share estimates underperform relative to our expectations, leading to content acquisition costs that do not exceed such minimum guarantees, our margins may be materially and adversely affected.
+
+ Difficulties in obtaining accurate and comprehensive information necessary to identify the compositions embodied in sound recordings on our platform and the ownership thereof may impact our ability to perform our obligations under our licenses, affect the size of our catalogue, impact our ability to control content acquisition costs, and lead to potential copyright infringement claims.
+
+ Comprehensive and accurate ownership information for the musical compositions embodied in sound recordings is often unavailable to us or difficult or, in some cases, impossible for us to obtain, often times because it is withheld by the owners or administrators of such rights. We currently rely on the assistance of third parties to determine this information. If the information provided to us or obtained by such third parties does not comprehensively 
+
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+ or accurately identify the ownership of musical compositions, or if we are unable to determine which musical compositions correspond to specific sound recordings, it may be difficult or impossible to identify the appropriate rights holders to whom to pay royalties. This may make it difficult to comply with the obligations of any agreements with those rights holders.
+
+ These challenges, and others concerning the licensing of musical compositions embodied in sound recordings on our service, may subject us to significant liability for copyright infringement, breach of contract, or other claims.
+
+ If our security systems are breached, we may face civil liability, and public perception of our security measures could be diminished, either of which would negatively affect our ability to attract and retain Premium service users, Ad-Supported Free service users, advertisers, content providers, and other business partners.
+
+ Techniques used to gain unauthorized access to data and software are constantly evolving, and we may be unable to anticipate or prevent unauthorized access to data pertaining to our users, including credit card and debit card information and other personal data about our users, business partners, and employees. Like all internet services, our service, which is supported by our own systems and those of third parties that we work with, is vulnerable to software bugs, computer viruses, internet worms, break-ins, phishing attacks, attempts to overload servers with denial-of-service, or other attacks and similar disruptions from unauthorized use of our and third-party computer systems, any of which could lead to system interruptions, delays, or shutdowns, causing loss of critical data or the unauthorized access to personal data. Computer malware, viruses, and computer hacking and phishing attacks have become more prevalent in the music subscription industry, and may occur on our systems in the future. Because of our prominence, we believe that it is a particularly attractive target for such attacks. Though it is difficult to determine what, if any, harm may directly result from any specific interruption or attack, any failure to maintain performance, reliability, security, and availability of our products and technical infrastructure to the satisfaction of our users may harm our reputation and ability to retain existing users and attract new users. Although we have developed systems and processes that are designed to protect our data and user data, to prevent data loss, to disable undesirable accounts and activities on the platform, and to prevent or detect security breaches, such measures may not provide absolute security, may fail, or may fail to stop such data loss or activities, and they may incur significant costs in protecting against or remediating cyber-attacks.
+
+ Any failure, or perceived failure, by us to maintain the security of data relating to our users, to comply with our posted privacy policy, laws and regulations, rules of self-regulatory organizations, industry standards, and contractual provisions to which we may be bound, could result in the loss of confidence in us, or result in actions against us by governmental entities or others, all of which could result in litigation and financial losses, and could potentially cause us to lose users, advertisers, and revenues.
+
+ Risks Related to Intellectual Property
+
+ Assertions by third parties of infringement or other violation by us of their intellectual property rights could harm our business, operating results, and financial condition.
+
+ Third parties have asserted, and may in the future assert, that we have infringed, misappropriated, or otherwise violated their copyrights, patents, and other intellectual property rights, and as we face increasing competition, the possibility of intellectual property rights claims against us grows.
+
+ Our ability to provide our service is dependent upon our ability to license intellectual property rights to sound recordings and the musical compositions embodied therein, as well as related content such as album cover art and artist images. Various laws and regulations govern the copyright and other intellectual property rights associated with sound recordings and musical compositions. Existing laws and regulations are evolving and subject to different interpretations, and various legislative or regulatory bodies may expand current or enact new laws or regulations. See Risk Factors Risks Related to Our Business Model, Strategy, and Performance Difficulties in obtaining accurate and comprehensive information necessary to identify the compositions embodied in sound recordings on our service and the ownership thereof may impact our ability to perform our obligations under our licenses, affect the size of our catalogue, impact our ability to control content acquisition costs, and lead to potential copyright infringement claims. 
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+ In addition, music, internet, technology, and media companies are frequently subject to litigation based on allegations of infringement, misappropriation, or other violations of intellectual property rights. Many companies in these industries, including many of our competitors, have substantially larger patent and intellectual property portfolios than we do. Various non-practicing entities that own patents and other intellectual property rights often attempt to aggressively assert claims in order to extract value from technology companies. Further, from time to time we may introduce new products and services, including in territories where we currently do not have an offering, which could increase our exposure to patent and other intellectual property claims from competitors and non-practicing entities. It is difficult to predict whether assertions of third-party intellectual property rights or any infringement or misappropriation claims arising from such assertions will substantially harm our business, operating results, and financial condition. If we are forced to defend against any infringement or misappropriation claims, whether they are with or without merit, are settled out of court, or are determined in our favor, we may be required to expend significant time and financial resources on the defense of such claims. Furthermore, an adverse outcome of a dispute may require us to pay significant damages, which may be even greater if we are found to have willfully infringed upon a party s intellectual property; cease exploiting copyrighted content that we have previously had the ability to exploit; cease using solutions that are alleged to infringe or misappropriate the intellectual property of others; expend additional development resources to redesign our solutions; enter into potentially unfavorable royalty or license agreements in order to obtain the right to use necessary technologies, content, or materials; indemnify our partners and other third parties; and/or take other actions that may have material effects on our business, operating results, and financial condition.
+
+ Moreover, we rely on software programmers to design our proprietary technologies, and we regularly contribute software source code under open source licenses and have made technology we developed available under open source licenses. We cannot assure you that our efforts to prevent the incorporation of licenses that would require us to disclose code and/or innovations in our products will always be successful, as we do not exercise complete control over the development efforts of our programmers, and we cannot be certain that our programmers have not used software that is subject to such licenses or that they will not do so in the future. In the event that portions of our proprietary technology are determined to be subject to licenses that require us to publicly release the affected portions of our source code, re-engineer a portion of our technologies, or otherwise be limited in the licensing of our technologies, we may be forced to do so, each of which could materially harm our business, operating results, and financial condition.
+
+ Finally, some of the content offered on our service is generated by our users or other content creators, subjecting us to heightened risk of claims of intellectual property infringement by third-parties if such users and content creators do not obtain the appropriate authorizations from rights holders.
+
+ Failure to protect our intellectual property could substantially harm our business, operating results, and financial condition.
+
+ The success of our business depends on our ability to protect and enforce our patents, trade secrets, trademarks, copyrights, and all of our other intellectual property rights, including the intellectual property rights underlying our products and services. We attempt to protect our intellectual property under patent, trade secret, trademark, and copyright law through a combination of intellectual property registration, employee, third-party assignment and nondisclosure agreements, other contractual restrictions, technological measures, and other methods. These measures may only offer limited protection and, moreover, are constantly evolving to meet the expanding needs of our business. Despite our efforts to protect our intellectual property rights, unauthorized parties may attempt to copy aspects of our product and brand features, make unauthorized use of original content we make available on our platform, or obtain and use our trade secrets and other confidential information. Moreover, policing our intellectual property rights is difficult and time-consuming. We cannot assure you that we would have adequate resources to protect and police our intellectual property rights, and we cannot assure you that the steps we take to do so will always be effective.
+
+ We have filed, and may in the future file, patent applications on certain of our innovations. It is possible, however, that these innovations may not be patentable. In addition, given the cost, effort, risks, and downside of obtaining patent protection, including the requirement to ultimately disclose the invention to the public, we may choose not to seek patent protection for some innovations. Furthermore, our patent applications may not issue as granted patents, the scope of the protection gained may be insufficient or an issued patent may be deemed invalid or unenforceable. We also cannot guarantee that any of our present or future patents or other intellectual property 
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+ rights will not lapse or be invalidated, circumvented, challenged, or abandoned. Neither can we guarantee that our intellectual property rights will provide competitive advantages to us. Our ability to assert our intellectual property rights against potential competitors or to settle current or future disputes could be limited by our relationships with third parties, and any of our pending or future patent applications may not have the scope of coverage originally sought. We cannot guarantee that our intellectual property rights will be enforced in jurisdictions where competition may be intense or where legal protection may be weak. We could lose both the ability to assert our intellectual property rights against, or to license our technology to, others and the ability to collect royalties or other payments. Certain countries legal systems do not provide the same level of support for the enforcement or protection of intellectual property rights as those of the United States, and as a result, our intellectual property and proprietary rights may be subject to theft without, or with little, legal recourse.
+
+ We currently own the www.anghami.com internet domain name and various other related domain names. Internet regulatory bodies generally regulate domain names. If we lose the ability to use a domain name in a particular country, we may be forced either to incur significant additional expenses to market our service within that country or, in extreme cases, to elect not to offer our service in that country. Either result could harm our business, operating results, and financial condition. The regulation of domain names in the United States and in foreign countries is subject to change. Regulatory bodies could establish additional top-level domains, appoint additional domain name registrars, or modify the requirements for holding domain names. As a result, we may not be able to acquire or maintain the domain names that utilize our brand names in the United States or other countries in which we may conduct business in the future.
+
+ Litigation or proceedings before governmental authorities and administrative bodies may be necessary in the future to enforce our intellectual property rights, to protect our patent rights, trademarks, trade secrets, and domain names and to determine the validity and scope of the proprietary rights of others. Our efforts to enforce or protect our proprietary rights may be ineffective and could result in substantial costs and diversion of resources and management time, each of which could substantially harm our operating results. Additionally, changes in law may be implemented, or changes in interpretation of such laws may occur, that may affect our ability to protect and enforce our patents and other intellectual property.
+
+ Our user metrics and other estimates are subject to inherent challenges in measurement, and real or perceived inaccuracies in those metrics may seriously harm and negatively affect our reputation and business.
+
+ We regularly review key metrics related to the operation of our business, including, but not limited to, active users, Premium subscribers and conversion, Premium average revenue per user, unit economics and EBITDA, Premium user churn rate, Arabic content and originals content creation to evaluate growth trends, measure performance, and make strategic decisions. These metrics are calculated using internal company data and have not been validated by an independent third party. These numbers were not prepared with a view toward public disclosure or compliance with the published guidelines of the SEC, or the applicable guidelines for the preparation and presentation of financial statements. While these numbers are based on what we believe to be reasonable estimates of our user base for the applicable period of measurement, there are inherent challenges in measuring how our service is used across large populations globally. For example, we believe that there are individuals who have multiple Anghami accounts, which can result in an overstatement of active users. Errors or inaccuracies in metrics or data could result in incorrect business decisions and inefficiencies.
+
+ In addition, advertisers generally rely on third-party measurement services to calculate our metrics, and these third-party measurement services may not reflect our true audience. Some of our demographic data also may be incomplete or inaccurate because users self-report their names and dates of birth. If advertisers, partners, or investors do not perceive our user, geographic, or other demographic metrics to be accurate representations of our user base, or if we discover material inaccuracies in our user, geographic, or other demographic metrics, our reputation may be seriously harmed. See Risk Factors Risks Related to Our Operations We rely on advertising revenue from our Ad-Supported Free service, and any failure to convince advertisers of the benefits of our Ad-Supported Free service in the future could harm our business, operating results, and financial condition, We are at risk of artificial manipulation of stream counts and failure to effectively manage and remediate such fraudulent streams could have an adverse impact on our business, operating results, and financial condition, and We are at risk of attempts at unauthorized access to our service and failure to effectively prevent and remediate such attempts could have an adverse impact on our business, operating results, and financial condition. 
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+ We are at risk of attempts at unauthorized access to our service and failure to effectively prevent and remediate such attempts could have an adverse impact on our business, operating results, and financial condition.
+
+ We are at risk of being impacted by attempts by third parties to manipulate and exploit our software for the purpose of gaining unauthorized access to our service. If we have currently failed to successfully detect and address such issues or if in the future we fail to successfully detect and address such issues, it may have artificial effects on key performance indicators, which underlie, among other things, our contractual obligations with rights holders and advertisers, as well as harm our relationship with advertisers and rights holders. This may also impact our results of operations, particularly with respect to margins on our Ad-Supported Free service segment, by increasing the Ad-Supported cost of revenue without a corresponding increase to our Ad-Supported revenue, and could expose us to claims for damages including, but not limited to, from rights holders, any of which could seriously harm our business. Moreover, once we detect and correct such unauthorized access and any key performance indicators it affects, investor confidence in the integrity of our key performance indicators could be undermined. These could have a material adverse impact on our business, operating results, and financial condition.
+
+ We are at risk of artificial manipulation of stream counts and failure to effectively manage and remediate such fraudulent streams could have an adverse impact on our business, operating results, and financial condition.
+
+ We have in the past been, and continues to be, impacted by attempts by third parties to artificially manipulate stream counts. Such attempts may, for example, be designed to generate revenue for rights holders or to influence placement of content on Anghami-created playlists or industry music charts. These potentially fraudulent streams also may involve the creation of non-bona fide user accounts or artists. We use a combination of algorithms and manual review by employees to detect fraudulent streams. However, it may not be successful in detecting, removing, and addressing all fraudulent streams (and any related user accounts). If we fail to successfully detect, remove, and address fraudulent streams and associated user accounts, it may result in the manipulation of our data, including the key performance indicators which underlie, among other things, our contractual obligations with rights holders and advertisers (which could expose us to the risk of litigation), as well as harm our relationships with advertisers and rights holders. In addition, once we detect, correct, and disclose fraudulent streams and associated user accounts and the key performance indicators they affect, investor confidence in the integrity of our key performance indicators could be undermined. These could have a material adverse impact on our business, operating results, and financial condition.
+
+ If we fail to develop and maintain an effective system of internal controls covering financial reporting, we may be unable to accurately or timely report our financial results or prevent fraud, and investor confidence and the market price of our shares may be materially and adversely impacted.
+
+ Effective internal controls over financial reporting are necessary for us to provide reliable financial reports and, together with adequate disclosure controls and procedures, are designed to prevent fraud. Prior to the Business Combination, Anghami was a private company with limited accounting personnel and limited resources with which to address internal controls over financial reporting. In connection with the audit of our consolidated financial statements for the years ended December 31, 2020 and 2021, Anghami and our independent registered public accounting firm identified certain material weaknesses in our internal controls over financial reporting.
+
+ As defined in the standards established by the U.S. Public Company Accounting Oversight Board, a material weakness is a deficiency, or combination of deficiencies, in internal controls covering financial reporting, such that there is a reasonable possibility that a material misstatement of the financial statements will not be detected or prevented on a timely basis.
+
+ The material weaknesses identified related to:
+
+ a lack of sufficiently skilled personnel with requisite IFRS reporting knowledge and experience;
+
+ a lack of sufficient entity level controls and sufficiently designed internal controls and financial reporting policies and procedures including segregation of duties; and
+
+ a lack of sufficient effective controls over prospective financial information used in Anghami s going concern assessment.
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+ These material weaknesses, if not remediated in a timely manner, may lead to material misstatements in our future consolidated financial statements.
+
+ Anghami was neither historically required to perform an evaluation of internal controls covering financial reporting as of December 31, 2020 or December 31, 2021 in accordance with the provisions of the Sarbanes-Oxley Act as we were a private company, nor did Anghami undertake a comprehensive assessment of its internal controls for purposes of identifying and reporting material weaknesses and other control deficiencies. Had Anghami performed a formal assessment of its internal controls over financial reporting or had its independent registered public accounting firm performed an audit of Anghami s internal controls over financial reporting, additional deficiencies may have been identified.
+
+ As a public company, we are required to maintain internal control over financial reporting, including adequate disclosure controls and procedures, and to report any material weaknesses in those internal controls. For example, we are required to perform system and process evaluation and testing of our internal control over financial reporting to allow our management to report on the effectiveness of our internal controls over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act. If we are unable to successfully remediate the identified material weaknesses, if we discover additional material weaknesses or if we are otherwise unable to report financial statements accurately or in a timely manner, we would be required to continue disclosing such material weaknesses in future filings with the SEC, which could adversely affect our business, investor confidence in the company and the market price of our ordinary shares and could subject us to litigation or regulatory enforcement actions. As a result, shareholders could lose confidence in our financial and other public reporting, which would harm our business and the market value of our ordinary shares.
+
+ Following the identification of the material weaknesses, Anghami has begun taking measures, and we will continue to take measures, to remediate these control deficiencies. Measures to rectify the weaknesses and deficiencies include the implementation of Oracle ERP, hiring outside consultants, provide technical training for its employees and hire internal auditors. Anghami is currently in the testing phase of the Oracle ERP and it is expected to become fully operational in the coming months. In addition, we have hired public accountants to assist us in accounting documentation, enhancing reporting requirements and develop internal policies and procedures. We plan to establish an internal audit function to make sure we have implemented best practices in financial controls.
+
+ Besides, we will implement control mechanisms on spending to match prospective financial statements. These mechanisms include detailed business plan for each new project to be approved by executive committee within the board. Anghami will be quarterly reporting the performance of these projects for executive committee to follow-up on performance and adjust course when needed.
+
+ However, the implementation of these measures may not fully address the material weaknesses in our internal controls covering financial reporting, and we cannot conclude that they have been fully remediated. Our failure to correct the material weaknesses or their failure to discover and address any other deficiencies could result in inaccuracies in our financial statements and impair our ability to comply with applicable financial reporting requirements and related regulatory filings on a timely basis. As of the date of the filing of this annual report, such material weaknesses have not been remediated.
+
+ We are subject to a variety of laws around the world. Government regulation of the internet is evolving and any changes in government regulations relating to the internet or other areas of our business or other unfavorable developments may adversely affect our business, operating results, and financial condition.
+
+ We are an international company with offices in UAE, Saudi Arabia, Egypt and Lebanon with further plans to expand regionally. As a result of this organizational structure and the scope of our operations, we are subject to a variety of laws in different countries. The scope and interpretation of the laws that are or may be applicable to us are often uncertain and may be conflicting, additionally, as our business grows and evolves, we will become subject to laws and regulations in additional jurisdictions. It is difficult to predict how existing laws will be applied to our business and the new laws to which we may become subject.
+
+ We are subject to general business regulations and laws, as well as regulations and laws specific to the internet. Such laws and regulations include, but are not limited to, labor, advertising and marketing, real estate, taxation, user privacy, data collection and protection, intellectual property, anti-corruption, anti-money laundering, foreign exchange controls, antitrust and competition, electronic contracts, telecommunications, sales procedures, automatic subscription renewals, credit card processing procedures, consumer protections, broadband internet access, and 
+
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+ content restrictions. We cannot guarantee that we have been or will be fully compliant in every jurisdiction in which we are subject to regulation, as existing laws and regulations are constantly changing. The adoption or modification of laws or regulations relating to the internet or other areas of our business could limit or otherwise adversely affect the manner in which we currently conduct business. Further, compliance with laws, regulations, and other requirements imposed upon our business may be onerous and expensive, and they may be inconsistent from jurisdiction to jurisdiction, further increasing the cost of compliance and doing business.
+
+ Moreover, as internet commerce continues to evolve, increasing regulation by international regulators becomes more likely and may lead to more stringent consumer protection laws, which may impose additional burdens on us. The adoption of any laws or regulations that adversely affect the popularity or growth in use of the internet, including laws limiting internet neutrality, could decrease user demand for our service and increase our cost of doing business. Future regulations, or changes in laws and regulations or their existing interpretations or applications, also could hinder our operational flexibility, raise compliance costs, and result in additional historical or future liabilities, resulting in material adverse impacts on our business, operating results, and financial condition.
+
+ We depend on highly skilled key personnel to operate our business, and if we are unable to attract, retain, and motivate qualified personnel, our ability to develop and successfully grow our business could be harmed.
+
+ We believe that our future success is highly dependent on the talents and contributions of our senior management, Edgard Maroun, our Chief Executive Officer, and Elias Habib, our Chief Technical Officer, members of our executive team, and other key employees, such as key engineering, finance, research and development, marketing, and sales personnel. Our future success depends on our continuing ability to attract, develop, motivate, and retain highly qualified and skilled employees. Certain members of our senior management are free to terminate their employment relationship at any time, and their knowledge of our business and industry may be difficult to replace. Qualified individuals are in high demand, particularly in the digital media industry, and we may incur significant costs to attract them. If we are unable to attract and retain senior management and key employees, we may not be able to achieve our strategic objectives, and our business could be harmed.
+
+ Risks Related to Our Operations
+
+ We may require additional capital to support business growth and objectives, and this capital might not be available on acceptable terms, if at all.
+
+ We intend to continue to make investments to support our business growth and may require additional funds to respond to business challenges, including the need to develop new features or enhance our existing services, expand into additional markets around the world, improve infrastructure, or acquire complementary businesses and technologies. Accordingly, we may need to engage, and have engaged, in equity and debt financings to secure additional funds. If we raise additional funds through future issuances of equity or convertible debt securities, our existing shareholders could suffer additional significant dilution, and any new equity securities we issue could have rights, preferences, and privileges superior to those of holders of our common shares. Any debt financing we secure in the future also could contain restrictive covenants relating to our capital raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital and pursue business opportunities, including potential acquisitions. We may not be able to obtain additional financing on terms favorable to us, if at all. If we are unable to obtain adequate financing or financing on terms satisfactory to us when required, our ability to continue to support business growth, acquire or retain users, and respond to business challenges could be significantly impaired.
+
+ There were a significant number of redemptions in connection with the Business Combination and if we are not successful in raising additional capital in a timely manner, we may have insufficient cash and liquidity to pay operating expenses and other obligations. Any such event would have a material adverse effect on our business and financial condition.
+
+ Prior to the Closing of the Business Combination, holders of approximately 97.6% of VMAC common stock exercised their right to redeem such shares. Due to the significant number of redemptions, we raised less capital than planned in the Business Combination. As a result, we may seek additional capital through a combination of private and public equity and debt offerings or other sources, which could result in dilution to our existing shareholders and decline in the price of our securities. There can be no assurance that we will be successful in obtaining capital 
+
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+ sufficient to meet our operating needs on terms or a timeframe acceptable to us or at all. See We may require additional capital to support business growth and objectives, and this capital might not be available on acceptable terms, if at all. 
+
+ Warrant holders may not elect to exercise any of their warrants which could significantly reduce the amount of cash we could receive from the exercise of the warrants.
+
+ This prospectus, among other things, relates to the issuance by us of up to 10,872,800 ordinary shares issuable upon exercise of our warrants, each warrant being exercisable for one ordinary share at an exercise price of $11.50 per ordinary share. The closing price of our ordinary shares on the Nasdaq on June 1, 2022 was $6.79 per ordinary share. As of such date, because the exercise price exceeded the price of our ordinary shares, our warrants were out-of-the-money, and we believe that it is unlikely that any warrant holder would exercise any warrants at a time when the warrants are out-of-the-money. The exercise of our warrants is discretionary by the warrant holder. Accordingly, there can be no assurance that the warrant holders will elect to exercise any or all of the warrants. To the extent that any of the warrant holders elect not to exercise their warrants or their warrants are exercised on a cashless basis, as may be permitted in certain circumstances, the amount of cash we would receive from the exercise of the warrants will decrease. It is also possible that we may receive no money from the exercise of our warrants. 
+
+ Streaming depends on effectively working with third-party platforms, operating systems, online platforms, hardware, networks, regulations, and standards that we do not control. Changes in our service or those operating systems, hardware, networks, regulations, or standards, and our limitations on our ability to access those platforms, operating systems, hardware, or networks may seriously harm our business.
+
+ Our service requires high-bandwidth data capabilities and if the costs of data usage increase or access to data networks is limited, our business may be seriously harmed. Additionally, to deliver high-quality audio, video, and other content over networks, our services must work well with a range of technologies, systems, networks, regulations, and standards that we do not control.
+
+ We also rely on a variety of operating systems, online platforms, hardware, and networks to reach our customers. These platforms range from desktop and mobile operating systems and application stores to wearables and intelligent voice assistants. The owners or operators of these platforms may not share our interests and may restrict our access to them or place conditions on access that would materially affect our ability to access those platforms. In particular, where the owner of a platform also is our direct competitor, the platform may attempt to use this position to affect our access to customers and ability to compete. Online platforms also may unilaterally impose certain requirements that negatively affect our ability to convert users to the Premium service, such as conditions that limit our freedom to communicate promotions and offers to the users. Similarly, online platforms may force us to use the platform s payment processing systems which may be inferior to and more costly than other payment processing services available in the market. Online platforms frequently change the rules and requirements for services like our to access the platform, and such changes may adversely affect the success or desirability of our service. Online platforms may limit our access to information about customers, limiting our ability to convert and retain them. Online platforms also may deny access to application programming interfaces ( API ) or documentation, limiting functionality of our service on the platform. There can be no assurance that we will be able to comply with the requirements of those operating systems, online platforms, hardware, networks, regulations, and standards on which our service depends, and failure to do so could result in serious harm to our business.
+
+ We face and will continue to face competition for Ad-Supported Free service users, Premium service users, and user listening time.
+
+ We compete for the time and attention of our users with other content providers on the basis of a number of factors, including quality of experience, relevance, diversity of content, ease of use, price, accessibility, perception of advertising load, brand awareness, and reputation. We compete with providers of on-demand music, which is purchased or available for free and playable on mobile devices and in the home. These forms of media may be purchased, downloaded, and owned such as iTunes audio files, MP3s, or CDs, or accessed from subscription or free online on-demand offerings by music providers or content streams from other online services. We face increasing competition for users from a growing variety of businesses, including other subscription music services around the world, many of which offer services that are similar to our service, that deliver music content over the internet, 
+
+ 
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+ through mobile phones, and through other wireless devices. Many of our current or future competitors are already entrenched or may have significant brand recognition in a particular region or market in which we operate or seek to penetrate. We also compete with providers of internet radio both online and through connected mobile devices. These internet radio providers may offer more extensive content libraries than we offer and some may have a broader international offering than ours. We also compete with terrestrial radio, satellite radio, and online radio. In addition, we also compete for users with providers of social media services both online and through connected mobile devices.
+
+ We also believe that companies with a combination of technical expertise, brand recognition, financial resources, and digital media experience also pose a significant threat of developing competing on-demand music distribution technologies. In particular, if known incumbents in the digital media space such as Facebook choose to offer competing services, they may devote greater resources than we have available, have a more accelerated time frame for deployment, and leverage their existing user base and proprietary technologies to provide services that our users and advertisers may view as superior. Furthermore, Spotify, YouTube, Amazon Prime, Apple Music, Deezer, Google Play Music, Joox, Pandora, SoundCloud, and others have competing services, which may negatively impact our business, operating results, and financial condition. Our current and future competitors may have higher brand recognition, more established relationships with music and other content licensors and mobile device manufacturers, greater financial, technical, and other resources, more sophisticated technologies, and/or more experience in the markets. In addition, Apple and Google also own application store platforms and are charging in-application purchase fees, which are not being levied on their own applications, thus creating a competitive advantage for themselves against us. As the market for on-demand music on the internet and mobile and connected devices increases, new competitors, business models, and solutions are likely to emerge.
+
+ We also face significant competition for users from companies promoting their own digital music content online or through application stores, including several large, well-funded, and seasoned participants in the digital media market. The websites and mobile applications of our competitors may rank higher than our website and our mobile application, and our application may be difficult to locate in mobile device application stores, which could draw potential users away from our service and toward those of our competitors. In addition, some of the competitors, including Apple, Amazon, and Google, have developed, and are continuing to develop, devices for which their music streaming service is preloaded, creating a visibility advantage. If we are unable to compete successfully for users against other digital media providers by maintaining and increasing our presence and visibility online, on mobile devices, and in application stores, our number of Premium service users and songs streamed on our service may fail to increase or may decline and subscription fees and advertising sales may suffer. See Risk Factors Risks Related to Our Business Model, Strategy, and Performance If our efforts to attract prospective users, retain existing users, and effectively monetize our products and services are not successful, our growth prospects and revenue will be adversely affected. 
+
+ We compete for a share of advertisers overall marketing budgets with other content providers on a variety of factors including perceived return on investment, effectiveness and relevance of advertising products, pricing structure, and ability to deliver large volumes or precise types of advertisements to targeted user demographic pools. We also compete for advertisers with a range of internet companies, including major internet portals, search engine companies, social media sites, and applications, as well as traditional advertising channels such as terrestrial radio. 
+
+ Failure to compete successfully against our current or future competitors could result in loss of current or potential advertisers, a reduced share of our advertisers overall marketing budget, loss of existing or potential users, or diminished brand strength, which could adversely affect our pricing and margins, lower revenue, increase research and development and marketing expenses, and prevent us from achieving profitability.
+
+ Our products are highly technical and may contain undetected errors, bugs, or vulnerabilities, which could manifest in ways that could seriously harm our reputation and our business. 
+
+ Many of the products we offer are highly technical and complex. These products or any other product we may introduce in the future may contain undetected hardware errors, software bugs, and other vulnerabilities. These errors, bugs, and vulnerabilities can manifest in any number of ways in our products, including through diminished performance, security incidents, malfunctions, service disruptions, or even permanently disabled products. We have a practice of rapidly updating our products, and as a result some errors, bugs, or vulnerabilities in our products may be discovered only after a product has been used, and may in some cases be detected only under certain circumstances or after extended use. Additionally, many of our products are available on multiple operating systems 
+
+ 
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+ and/or multiple devices offered by different manufacturers, and changes or updates to such operating systems or devices may cause errors or functionality problems in our products, including rendering our products inoperable by some users. Our products operate in conjunction with, and we are dependent upon, third-party products and services, and any error or bug in one of these third-party products or services could thwart our users ability to access our products and services, present a security vulnerability, and harm our reputation. Additionally, any errors, bugs, or other vulnerabilities discovered in our code or backend after release could damage our reputation, drive away users, allow third parties to manipulate or exploit our software, lower revenue, impact the stability or accuracy of our user metrics or other estimates, and expose us to claims for damages, any of which could seriously harm our business. Additionally, errors, bugs, or other vulnerabilities may-either directly or if exploited by third parties-affect our ability to make accurate royalty payments. See Risks Related to Intellectual Property Our royalty payment arrangements are complex, and it is difficult to estimate the amount payable under license agreements.
+
+ We could also face claims for product liability, tort, or breach of warranty. Defending a lawsuit, regardless of its merit, is costly and may divert management s attention and seriously harm our reputation and our business. In addition, if our liability insurance coverage proves inadequate or future coverage is unavailable on acceptable terms or at all, our business could be seriously harmed.
+
+ Interruptions, delays or discontinuations in service arising from our own systems or from third parties could impair the delivery of our service and harm our business.
+
+ We rely on systems housed in our own facilities and upon third parties, including bandwidth providers and third-party cloud data storage services, to enable our users to receive our content in a dependable, timely, and efficient manner. We have experienced and may in the future experience periodic service interruptions and delays involving our own systems and those of third parties that we work with. Both our own facilities and those of third parties are vulnerable to damage or interruption from earthquakes, floods, fires, power loss, telecommunications failures, and similar events. They also are subject to break-ins, sabotage, intentional acts of vandalism, the failure of physical, administrative, technical, and cyber security measures, terrorist acts, natural disasters, human error, the financial insolvency of third parties that we work with, and other unanticipated problems or events. The occurrence of any of these events could result in interruptions in our service and to unauthorized access to, or alteration of, the content and data contained on our systems and that these third parties store and deliver on our behalf. Any disruption in the services provided by these third parties could materially adversely impact our business reputation, customer relations, and operating results.
+
+ If we fail to accurately predict, recommend, and play music that our users enjoy, we may fail to retain existing users and attract new users in sufficient numbers to meet investor expectations for growth or to operate our business profitably.
+
+ Our system for predicting user music preferences and selecting music tailored to our users individual music tastes is based on advanced data analytics systems and proprietary algorithms. While we have invested, and will continue to invest, significant resources in refining these technologies; however, these investments may not yield an attractive return and such refinements may not be effective. The effectiveness of our ability to predict user music preferences and select music tailored to our users individual music tastes depends in part on our ability to gather and effectively analyze large amounts of user data. In addition, our ability to offer users songs that they have not previously heard and impart a sense of discovery depends on our ability to acquire and appropriately categorize additional songs that will appeal to each users diverse and changing tastes. Although we have a large catalogue of songs available to stream, we may not be able to effectively identify and analyze additional songs that our users will enjoy. Our ability to predict and select music content that our users enjoy is critical to our service and failure to make accurate predictions could materially adversely affect our ability to adequately attract and retain users, increase hours spent by users consuming video and audio content on our app ( Content Hours ), and sell advertising to meet investor expectations for growth or to operate the business profitably.
+
+ If we fail to effectively manage our growth, our business, operating results, and financial condition may suffer.
+
+ Our rapid growth has placed, and will continue to place, significant demands on our management and operational and financial infrastructure. In order to attain and maintain profitability, we will need to recruit, integrate, and retain skilled and experienced personnel who can demonstrate our value proposition to users, advertisers, and business 
+
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+ partners and who can increase the monetization of the music streamed on our service, particularly on mobile devices. Continued growth also could strain our ability to maintain reliable service levels for our users, effectively monetize the music streamed, develop and improve our operational and financial controls, and recruit, train, and retain highly skilled personnel. If our systems do not evolve to meet the increased demands placed on us by an increasing number of advertisers, we also may be unable to meet obligations under advertising agreements with respect to the delivery of advertising or other performance obligations. As our operations grow in size, scope, and complexity, we will need to improve and upgrade our systems and infrastructure, which will require significant expenditures and allocation of valuable technical and management resources. If we fail to maintain efficiency and allocate limited resources effectively in our organization as we grow, our business, operating results, and financial condition may suffer.
+
+ We have incurred significant operating losses in the past, and we may not be able to generate sufficient revenue to be profitable, or to generate positive cash flow on a sustained basis. In addition, our revenue growth rate may decline.
+
+ Since our inception, we have incurred significant operating losses and as of December 31, 2021, had an accumulated deficit of $26,842,475. For the years ended December 31, 2021 and 2020, our operating losses were $13,564,077 and $2,548,313, respectively. We have incurred significant costs to license content and continue to pay royalties to music labels, publishers, and other copyright owners for such content. We cannot assure you that we will generate sufficient revenue from the sale of our services to offset the cost of our content and these royalty expenses. If we cannot successfully earn revenue at a rate that exceeds the operational costs, including royalty expenses, associated with our services, we will not be able to achieve or sustain profitability or generate positive cash flow on a sustained basis.
+
+ In the future, our revenue growth rate may decline because of a variety of factors, including increased competition and the maturation of our business. We cannot assure you that our revenue will continue to grow or will not decline. You should not consider our historical revenue growth or operating expenses as indicative of our future performance. If our revenue growth rate declines or our operating expenses exceed our expectations, our financial performance will be adversely affected.
+
+ Additionally, we also expect our costs to increase in future periods, which could negatively affect our future operating results and ability to achieve profitability. We expect to continue to expend substantial financial and other resources on:
+
+ securing top quality audio and video content from leading music labels, distributors, aggregators, as well as the publishing right to the underlying musical compositions;
+
+ creating new forms of original content;
+
+ our technology infrastructure, including website architecture, development tools, scalability, availability, performance, security, and disaster recovery measures;
+
+ research and development, including investments in our research and development team and the development of new features;
+
+ sales and marketing, including a significant expansion of our field sales organization;
+
+ international expansion in an effort to increase our member base, engagement, and sales; and
+
+ general administration, including legal and accounting expenses, related to being a public company.
+
+ These investments may not result in increased revenue or growth in our business. If we fail to continue to grow our revenue and overall business, our business, operating results, and financial condition would be harmed.
+
+ Our ability to increase the number of users will depend in part on our ability to distribute our service, which may be affected by third-party interference beyond our control.
+
+ The use of our service depends on the ability of our users to access the internet, our website, and the Anghami app. Enterprises or professional organizations, including governmental agencies, could block access to the internet, our website, and the Anghami application for a number of reasons such as security or confidentiality concerns or regulatory reasons that could adversely impact our user base.
+
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+ Additionally, we distribute our application via smartphone and tablet application download stores managed by Amazon, Apple, Google, and Microsoft, among others. Certain of these companies are now, and others may in the future become, our competitors, and could stop allowing or supporting access to our service through their products, could allow access for us only at an unsustainable cost, or could make changes to the terms of access in order to make our service less desirable or harder to access, for competitive reasons.
+
+ We rely on advertising revenue from our Ad-Supported Free service, and any failure to convince advertisers of the benefits of the Ad-Supported Free service in the future could harm our business, operating results, and financial condition.
+
+ Our ability to attract and retain advertisers, and ultimately to generate advertising revenue, depends on a number of factors, including:
+
+ increasing the number of hours Ad-Supported Free service users spend listening to music or otherwise engaging with content;
+
+ increasing the number of Ad-Supported Free service users;
+
+ keeping up with advancements in technology;
+
+ competing effectively for advertising dollars from other online and mobile music streaming and media companies;
+
+ maintaining and growing relationships with marketers, agencies, and other demand sources who purchase advertising inventory from us; and
+
+ continuing to develop and diversify our advertisement platform, which currently includes delivery of advertising products through multiple delivery channels, including traditional computers, mobile, and other connected devices.
+
+ We may not succeed in capturing a greater share of our advertisers core marketing budgets, particularly if we are unable to achieve the scale, reach, products, and market penetration necessary to demonstrate the effectiveness of our advertising solutions, or if our advertising model proves ineffective or not competitive when compared to other alternatives and platforms through which advertisers choose to invest their budgets. Failure to grow the Ad-Supported Free service user base and to effectively demonstrate the value of our Ad-Supported Free service to advertisers could result in loss of, or reduced spending by, existing or potential future advertisers, which would materially harm our business, operating results, and financial condition.
+
+ Negative media coverage could adversely affect our business.
+
+ We receive a high degree of media coverage in the MENA Operating Area. Unfavorable publicity regarding, for example, payments to music labels, publishers, artists, and other copyright owners, our privacy practices, terms of service, service changes, service quality, litigation or regulatory activity, government surveillance, the actions of our advertisers, the actions of our developers whose services are integrated with our service, the use of our service for illicit, objectionable, or illegal ends, the actions of any users, the quality and integrity of content shared on our service, or the actions of other companies that provide similar services to it, could materially adversely affect our reputation. Such negative publicity also could have an adverse effect on the size, engagement, and loyalty of our user base and result in decreased revenue, which would materially adversely affect our business, operating results, and financial condition.
+
+ Our business depends on a strong brand, and any failure to maintain, protect, and enhance the brand would hurt our ability to retain or expand our base of Ad-Supported Free service users, Premium service users, and advertisers.
+
+ We have developed a strong brand that we believe has contributed significantly to the success of our business. Maintaining, protecting, and enhancing the Anghami brand is critical to expanding our base of Ad-Supported Free service users, Premium service users, and advertisers, and will depend largely on our ability to continue to develop and provide an innovative and high-quality experience for our users and to attract advertisers, content 
+
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+ owners, mobile device manufacturers, and other consumer electronic product manufacturers to work with us, which we may not do successfully. If we do not successfully maintain a strong brand, our business could be harmed.
+
+ Our brand may be impaired by a number of other factors, including any failure to keep pace with technological advances on our platform or with our service, slower load times for our service, a decline in the quality or quantity of the content available, a failure to protect intellectual property rights, or any alleged violations of law, regulations, or public policy. Additionally, the actions of our developers, advertisers, and content partners may affect our brand if users do not have a positive experience using third-party applications or websites integrated with us or that make use of our content.
+
+ Our trademarks, trade dress, and other designations of origin are important elements of our brand. We have registered Anghami and other marks as trademarks in New York, UK, Switzerland, UAE, Saudi Arabia, Lebanon, Egypt, Jordan, and certain other jurisdictions. Nevertheless, competitors or other companies may adopt marks similar to us, or use our marks and confusingly similar terms as keywords in internet search engine advertising programs, thereby impeding our ability to build brand identity and possibly leading to confusion among our users. Whether or not our trademark applications are denied, third parties may claim that our trademarks infringe upon their rights. As a result, we could be forced to pay significant settlement costs or cease the use of these trademarks and associated elements of our brand in those or other jurisdictions. Doing so could harm our brand or brand recognition and adversely affect our business, financial condition, and results of operation.
+
+ Various regulations related to privacy and data security concerns pose the threat of lawsuits and other liability, require us to expend significant resources, and may harm our business, operating results, and financial condition.
+
+ We collect and use personal and other information from and about our users as they interact with our Service. Various laws and regulations govern the collection, use, retention, sharing, and security of the data we receive from and about our users. Privacy groups and government bodies have increasingly scrutinized the ways in which companies link personal identities and data associated with particular users or devices with data collected through the internet, and we expect such scrutiny to continue to increase. Alleged violations of laws and regulations relating to privacy and data security, and any relevant claims, may expose us to potential liability and may require us to expend significant resources in responding to and defending such allegations and claims. Claims or allegations that we have violated laws and regulations relating to privacy and data security could in the future result in negative publicity and a loss of confidence by our users and partners. Such claims or allegations also may subject us to fines, including by data protection authorities and credit card companies, and could result in the loss of our ability to accept credit and debit card payments.
+
+ Additionally, the regulatory framework for privacy issues worldwide is currently in flux and is likely to remain so for the foreseeable future. Our business, including our ability to operate and expand internationally, could be adversely affected if legislation or regulations are adopted, interpreted, or implemented in a manner that is inconsistent with our current business practices and that require changes to these practices, the design of our website, services, features, or our privacy policy. Our business could be harmed by any significant change to applicable laws, regulations, or industry practices regarding the use of our users personal data, for example regarding the manner in which disclosures are made and how the express or implied consent of users for the use of personal data is obtained. Such changes may require us to modify our services and features, possibly in a material manner, and may limit our ability to develop new services and features that make use of the data that users voluntarily share. In addition, some of our developers or other partners, such as those that help measure the effectiveness of ads, may receive or store information provided by us or by users through mobile or web applications integrated with our service. We provide limited information to such third parties based on the scope of services provided. However, if these third parties or developers fail to adopt or adhere to adequate data security practices, or in the event of a breach of their networks, our data or our users data may be improperly accessed, used, or disclosed.
+
+ The European Union General Data Protection Regulation ( GDPR ) came into effect on May 25, 2018 and required us to change our privacy and data security practices. The GDPR implemented more stringent operational requirements for processors and controllers of personal data, including, for example, requiring expanded disclosures about how personal information is to be used, limitations on retention of information, mandatory data breach notification requirements, and higher standards for data controllers to demonstrate that they have obtained valid 
+
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+ consent or have another legal basis in place to justify their data processing activities. The GDPR provides that EU member states may make their own additional laws and regulations in relation to certain data processing activities, which could limit our ability to use and share personal data or could require localized changes to our operating model. Under the GDPR, fines of up to 20 million or up to 4% of the total worldwide annual turnover of the preceding financial year, whichever is higher, may be assessed for non-compliance. These new laws also could cause our costs to increase and result in further administrative costs to providing our service.
+
+ We may find it necessary or desirable to join self-regulatory bodies or other privacy-related organizations that require compliance with their rules pertaining to privacy and data security. We also may be bound by contractual obligations that limit our ability to collect, use, disclose, share, and leverage user data and to derive economic value from it. New laws, amendments to, or reinterpretations of existing laws, rules of self-regulatory bodies, industry standards, and contractual obligations, as well as changes in our users expectations and demands regarding privacy and data security, may limit our ability to collect, use, and disclose, and to leverage and derive economic value from user data. Restrictions on our ability to collect, access and harness user data, or to use or disclose user data or any profiles that we develop using such data, may require us to expend significant resources to adapt to these changes, and would in turn limit our ability to stream personalized music content to our users and offer targeted advertising opportunities to our Ad-Supported Free service users.
+
+ In addition, any failure or perceived failure by us to comply with privacy or security laws, policies, legal obligations, industry standards, or any security incident that results in the unauthorized release or transfer of personal data may result in governmental enforcement actions and investigations, including fines and penalties, enforcement orders requiring us to cease processing or operate in a certain way, litigation and/or adverse publicity, including by consumer advocacy groups, and could cause our customers to lose trust in us, which could have an adverse effect on our reputation and business. Such failures could have a material adverse effect on our financial condition and operations. If the third parties we work with (for example, cloud-based vendors) violate applicable laws or contractual obligations or suffer a security breach, such violations also may put us in breach of our obligations under privacy laws and regulations and/or could in turn have a material adverse effect on our business.
+
+ We have incurred, and will continue to incur, expenses to comply with privacy and security standards and protocols imposed by law, regulation, self-regulatory bodies, industry standards, and contractual obligations.
+
+ Increased regulation of data capture, analysis, and utilization and distribution practices, including self-regulation and industry standards, could increase our cost of operation, limit our ability to grow our operations, or otherwise adversely affect our business, operating results, and financial condition.
+
+ We are subject to a number of risks related to credit card and debit card payments we accept.
+
+ We accept payments using a variety of methods, including credit and debit card transactions. For credit and debit card payments, we pay interchange and other transaction fees, which may increase over time. An increase in those fees would require us to either increase the prices we charge for our Premium Service, which could cause us to lose Premium service users and subscription revenue, or suffer an increase in our costs without a corresponding increase in the price we charge for our Premium Service, either of which could harm our business, operating results, and financial condition.
+
+ We rely on third-party service providers for payment processing services. Our business could be materially disrupted if these third-party service providers become unwilling or unable to provide these services to us. If we or our service providers for payment processing services have problems with our billing software, or the billing software malfunctions, it could have a material adverse effect on our user satisfaction and could cause one or more of the major credit card companies to disallow our continued use of their payment products. In addition, if our billing software fails to work properly and, as a result, we do not automatically charge our Premium service user s credit cards on a timely basis or at all, our business, financial condition, and results of operations could be materially adversely affected.
+
+ We are also subject to payment card association operating rules, certification requirements, and rules governing electronic funds transfers, which could change or be reinterpreted to make it more difficult for us to comply. Any failure to comply with these rules or requirements may subject us to higher transaction fees, fines, penalties, 
+
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+ damages, and civil liability, and may result in the loss of our ability to accept credit and debit card payments. Further, there is no guarantee that, even if we are in compliance with such rules or requirements, such compliance will prevent illegal or improper use of our payment systems or the theft, loss, or misuse of data pertaining to credit and debit cards, credit and debit card holders, and credit and debit card transactions. Certain payment card associations have proposed additional requirements for trial offers for automatic renewal subscription services, which may hinder our ability to attract or retain Premium service users.
+
+ If we fail to adequately control fraudulent credit card transactions, we may face civil liability, diminished public perception of our security measures, and significantly higher credit card-related costs, each of which could adversely affect our business, financial condition, and results of operations. If we are unable to maintain our chargeback rate or refund rates at acceptable levels, credit card and debit card companies may increase our transaction fees or terminate their relationships with us. The termination of our ability to process payments on any major credit or debit card would significantly impair our ability to operate our business.
+
+ We are subject to a number of risks related to other payment solution providers.
+
+ We accept payments through various payment solution providers, such as telco integrated billings and prepaid codes vendors. These payment solution providers provide services to us in exchange for a fee and settlement terms, which may be subject to change, impacting our profitability and cash position. Furthermore, we rely on their accurate and timely reports on sales and redemptions. If such accurate and timely reports are not being provided, it will affect the accuracy of our reports to our licensors, and also affect the accuracy of our financial reporting. In addition, our ability to provide subscription service is dependent on the performance of such payment solution providers. If these service providers face technical issues that result in service downtime, our ability to generate subscription revenue could be adversely impacted.
+
+ Emerging industry trends in digital advertising may pose challenges for our ability to forecast or optimize our advertising inventory, which may adversely impact the Ad-Supported Free service revenue.
+
+ The digital advertising industry is introducing new ways to measure and price advertising inventory. In the absence of a uniform industry standard, agencies and advertisers have adopted several different measurement methodologies and standards. In addition, measurement services may require technological integrations, which are still being evaluated by the advertising industry without an agreed-upon industry standard metric. As these trends in the industry continue to evolve, our advertising revenue may be adversely affected by the availability, accuracy, and utility of the available analytics and measurement technologies as well as our ability to successfully implement and operationalize such technologies and standards.
+
+ Further, the digital advertising industry is shifting to data-driven technologies and advertising products, such as automated buying. These data-driven advertising products and automated buying technologies allow publishers and advertisers to use data to target advertising toward specific groups of users who are more likely to be interested in the advertising message delivered to them. These advertising products and programmatic technologies are currently more developed in terms of advertising technology and industry adoption on the web than they are on mobile or on other software applications, and may not integrate with our desktop software version of the Ad-Supported Free service. Because the majority of our Ad-Supported Free service user hours occur on mobile devices, if we are unable to deploy effective solutions to monetize the mobile device usage by Ad-Supported Free service user base, our ability to attract advertising spend, and ultimately advertising revenue, may be adversely affected by this shift.
+
+ Our operating results may fluctuate, which makes our results difficult to predict.
+
+ Our revenue and operating results could vary significantly from quarter to quarter and year to year because of a variety of factors, many of which are outside our control. As a result, comparing our operating results on a period-to-period basis may not be meaningful. In addition to other risk factors discussed herein, factors that may contribute to the variability of our quarterly and annual results include:
+
+ Our ability to retain current user base, increase the number of Ad-Supported Free service users and Premium service users, and increase users time spent streaming content;
+
+ Our ability to effectively manage growth;
+
+ 
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+ Our ability to attract and retain existing advertisers and prove that our advertising products are effective enough to justify a pricing structure that is profitable;
+
+ the effects of increased competition on our business;
+
+ Our ability to keep pace with changes in technology and competitors;
+
+ lack of accurate and timely reports and invoices from rights holders and partners;
+
+ interruptions in service, whether or not we are responsible for such interruptions, and any related impact on our reputation;
+
+ Our ability to pursue and appropriately time our entry into new geographic or content markets and, if pursued, our management of this expansion;
+
+ costs associated with defending any litigation, including intellectual property infringement litigation;
+
+ the impact of general economic conditions on our revenue and expenses; and
+
+ changes in regulations affecting our business.
+
+ Seasonal variations in user and marketing behavior also may cause fluctuations in our financial results. We expect to experience some effects of seasonal trends in user behavior due to increased internet usage and sales of streaming service subscriptions and devices during holiday periods, such as New Year s Eve, Eid, and Christmas. We also may experience higher advertising sales during such increased usage periods, and incur greater marketing expenses as we attempt to attract new users and convert Ad-Supported Free service users to Premium service users. In addition, expenditures by advertisers tend to be cyclical and are often discretionary in nature, reflecting overall economic conditions, the economic prospects of specific advertisers or industries, budgeting constraints and buying patterns, and a variety of other factors, many of which are outside our control.
+
+ If we do not receive previously agreed financial incentives from the Abu Dhabi Investment Office, the results of our operations could be adversely affected.
+
+ Our headquarters are in Abu Dhabi, the capital of the UAE, at the Abu Dhabi Global Market ( ADGM ). The Abu Dhabi Investment Office ( ADIO ), being the Abu Dhabi government s investment attraction and development hub, has committed to providing up to approximately AED 60 million in financial incentives to support the establishment, growth and development of our technology and research and development center in Abu Dhabi. Pursuant to the incentive programme agreement entered into between ADIO and us, dated December 23, 2020, we will be entitled to receive these financial incentives, in the form of rebates, only upon meeting certain performance metrics and conditions. These include, establishing the project plan (which includes setting up the new global headquarters in Abu Dhabi and moving personnel to such office), certain employment commitments and investment commitments. Based on these achievements, we will have to submit quarterly financial reports and ADIO has the right to approve these reports and determine applicable rebates payable for such quarter. If we are unable to meet these performance metrics or conditions in any quarter, or otherwise fails to receive the financial incentive payments, the results of our operations could be adversely affected. In addition, we have agreed to use reasonable efforts to explore a dual listing on the Abu Dhabi Securities Exchange if we determine that a dual listing is in our best interest, subject to prevailing market conditions, within 18 months of entering into the agreement.
+
+ If currency exchange rates fluctuate substantially in the future, the results of our operations could be adversely affected.
+
+ As we continue to expand our international operations, we become increasingly exposed to the effects of fluctuations in currency exchange rates. We incur expenses for employee compensation, rental fees, and other operating expenses in the local currency, and an increasing percentage of our international revenue is from users who pay us in currencies other than U.S. dollars, including the Lebanese Pound, Egyptian Pound, Saudi Riyal, and UAE Dirham. Our principle foreign currency risk arises from Egyptian and Lebanese Pound denominated transactions. For instance, as at December 31, 2021, we have had to reclass our bank balances in Lebanese Pounds equivalent of $433,660 to other financial assets due to significant devaluation of Lebanese Pounds against 
+
+ 
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+ U.S. dollar caused by the ongoing political and economic situation in Lebanon. We have also had to drop the value of contract assets denominated in Lebanese pounds resulting in $257,254 in foreign exchange loss during the year ended December 31, 2021. Fluctuations in the exchange rates between the U.S. dollar and other currencies may impact expenses as well as revenue, and consequently have an impact on margin and the reported operating results. This could have a negative impact on our reported operating results. To date, we have engaged in limited hedging strategies related to foreign exchange risk stemming from our operations. These strategies may include instruments such as foreign exchange forward contracts and options. However, these strategies should not be expected to fully eliminate the foreign exchange rate risk that we are exposed to.
+
+ The ongoing coronavirus (COVID-19) pandemic and the global attempt to contain it may harm our industry, business, and results of operations.
+
+ The COVID-19 pandemic had a significant negative impact on our business and that of the our customers. The direct impact on the our business, beyond disruptions in normal business operations, was driven by the reduced spending of major advertisers and consumer spending on discretionary items, which in turn adversely affected our revenue from both Ad-Supported subscriptions and Premium subscriptions. While many of our advertisers have increased their advertising budget and there has been an increase in our users engagement, these are still not at the pre-pandemic level. As a result of the COVID-19 pandemic, artists and other content creators have experienced delays or interruptions in their ability to create and release new content on the platform. The decrease in the amount or quality of content available on our platform has adversely affected user engagement and our financial performance. The COVID-19 pandemic also delayed our fundraising process to the last quarter of 2020. The ultimate impact of COVID-19 on our financial performance and results of operations will depend on numerous evolving factors that we may not be able to accurately predict, including the duration and scope of the pandemic, the impact of the pandemic on economic activity, and actions taken by governments, businesses, and individuals in response to the length of time that these disruptions exist. 
+
+ With the start of COVID-19 restrictions in 2020 and throughout 2021, our adopted a flexible work program in which employees can work remotely or from the office or a mix of both. This situation could challenge our ability to manage employees, maintain a high level of productivity and creativity, impact financial controls, increase cyber security risk and increase our compliance costs as many employees are subject to different local regulations. Organizations worldwide have seen an increased phishing and ransomware risk as bad actors try to take advantage of remote workplace vulnerabilities. Our own systems are subject to such increased threats.
+
+ The impact of worldwide economic conditions may adversely affect our business, operating results, and financial condition.
+
+ Our financial performance is subject to worldwide economic conditions and their impact on levels of advertising spending. Expenditures by advertisers generally tend to reflect overall economic conditions, and to the extent that the economy continues to stagnate, reductions in spending by advertisers could have a material adverse impact on our business. Historically, economic downturns have resulted in overall reductions in advertising spending. Economic conditions may adversely impact levels of consumer spending, which could adversely impact the number of users who purchase our Premium services on our website and mobile application.
+
+ Consumer purchases of discretionary items generally decline during recessionary periods and other periods in which disposable income is adversely affected. To the extent that overall economic conditions reduce spending on discretionary activities, our ability to retain current and obtain new Premium service users could be hindered, which could reduce our subscription revenue and negatively impact our business.
+
+ Geopolitical and other challenges and uncertainties due to the ongoing military conflict between Russia and Ukraine could have a material adverse effect on the global economy and our business.
+
+ Global markets are currently operating in a period of economic uncertainty, volatility and disruption in connection with the conflict between Russia and Ukraine. Although the length and impact of the ongoing military conflict is highly unpredictable, the conflict in Ukraine and any other geopolitical tensions could have an adverse effect on the economy and business activity globally and lead to: credit and capital market disruptions; significant volatility in commodity prices; slowdown or disruption of the global and local supply chain; potential appreciation of the U.S. dollar that could affect exchange rates in the markets in which we operate; increase in interest rates and inflation 
+
+ 
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+ in the markets in which we operate; and lower or negative global growth. The impact of these measures, as well as potential responses to them by Russia, is currently unknown and, while we currently have no exposure to Russia and Ukraine, current and future measures could significantly and adversely affect our business, financial condition and results of operations, including, potential sanctions relating to the markets where we operate. We are continuing to monitor the situation in Russia, Ukraine and globally and assess its potential impact on our business. Any of the abovementioned factors could adversely affect our business, prospects, financial condition, and operating results. The extent and duration of the military action, sanctions and resulting market disruptions are impossible to predict, but could be substantial. Any such disruptions may also magnify the impact of other risks described elsewhere in this annual report.
+
+ Risks Related to Tax
+
+ We are a multinational company that faces complex taxation regimes in various jurisdictions. Audits, investigations, and tax proceedings could have a material adverse effect on our business, operating results, and financial condition.
+
+ We are subject to income and non-income taxes in numerous jurisdictions. Income tax accounting often involves complex issues, and judgment is required in determining our worldwide provision for income taxes and other tax liabilities, if any. We regularly assess the likely outcomes of these audits in order to determine the appropriateness of our tax reserves as well as tax liabilities going forward. In addition, the application of withholding tax, value added tax, goods and services tax, sales taxes and other non-income taxes is not always clear and we may be subject to tax audits relating to such withholding or non-income taxes. We believe that our tax positions are reasonable and that the tax reserves are adequate to cover any potential liability. However, tax authorities in certain jurisdictions may disagree with our position, including the propriety of our related party arm s length transfer pricing policies and the tax treatment of corresponding expenses and income. If any of these tax authorities were successful in challenging our positions, we may be liable for additional income tax and penalties and interest related thereto in excess of any reserves established therefor, which may have a significant impact on our results and operations and future cash flow. Additionally, changes in tax laws, treaties, or regulations or their interpretation or enforcement are unpredictable. Any of these occurrences could have a material adverse effect on our results of operations and financial condition.
+
+ The IRS may not agree that we should be treated as a non-U.S. corporation for U.S. federal income tax purposes.
+
+ A corporation is generally considered for U.S. federal income tax purposes to be a tax resident in the jurisdiction of our organization or incorporation. Accordingly, under the generally applicable U.S. federal income tax rules, we, since we are incorporated under the laws of the Cayman Islands, would be classified as a non-U.S. corporation (and, therefore, not a U.S. tax resident) for U.S. federal income tax purposes. Section 7874 of the Code provides an exception to this general rule under which a non-U.S. incorporated entity may, in certain circumstances, be treated as a U.S. corporation for U.S. federal income tax purposes. If we were to be treated as a U.S. corporation for U.S. federal income tax purposes, we could be subject to substantial liability for additional U.S. income taxes, and the gross amount of any dividend payments to our non-U.S. holders could be subject to U.S. withholding tax.
+
+ Further, the rules for determining ownership under Section 7874 are complex, unclear and the subject of ongoing regulatory change. Accordingly, there can be no assurance that the IRS would not assert a contrary position to those described above or that such an assertion would not be sustained by a court in the event of litigation.
+
+ If we were a passive foreign investment company for United States federal income tax purposes for any taxable year, U.S. holders of ordinary shares could be subject to adverse United States federal income tax consequences.
+
+ If we are or become a passive foreign investment company, or a PFIC, within the meaning of Section 1297 of the Code for any taxable year during which a U.S. holder holds ordinary shares, certain adverse U.S. federal income tax consequences may apply to such U.S. holder. PFIC status depends on the composition of a company s income and assets and the fair market value of our assets from time to time, as well as on the application of complex statutory and regulatory rules that are subject to potentially varying or changing interpretations. Based on the projected composition of our income and assets, including goodwill, we may be classified as a PFIC for our current taxable year or in the foreseeable future. There can be no assurance that we will not be treated as a PFIC for any taxable year.
+
+ 
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+ If we were treated as a PFIC, a U.S. holder of ordinary shares may be subject to adverse U.S. federal income tax consequences, such as taxation at the highest marginal ordinary income tax rates on capital gains and on certain actual or deemed distributions, interest charges on certain taxes treated as deferred, and additional reporting requirements. Certain elections (including a qualified electing fund ( QEF ) or a mark-to-market election) may be available to U.S. holders of ordinary shares to mitigate some of the adverse tax consequences resulting from PFIC treatment.
+
+ If a United States person is treated as owning at least 10% of our shares, such person may be subject to adverse U.S. federal income tax consequences.
+
+ If a United States person is treated as owning (directly, indirectly or constructively) at least 10% of the value or voting power of our shares, such person may be treated as a United States shareholder with respect to each of us and our direct and indirect subsidiaries ( Anghami Inc. Group ) that is a controlled foreign corporation. If the Anghami Inc. Group includes one or more U.S. subsidiaries, under recently-enacted rules, certain of our non-U.S. subsidiaries could be treated as controlled foreign corporations regardless of whether we are treated as a controlled foreign corporation (although there are currently proposed Treasury Regulations that may significantly limit the application of these rules).
+
+ A United States shareholder of a controlled foreign corporation may be required to report annually and include in our U.S. taxable income our pro rata share of the controlled foreign corporation s Subpart F income and (in computing our global intangible low-taxed income ) tested income and a pro rata share of the amount of U.S. property (including certain stock in U.S. corporations and certain tangible assets located in the United States) held by the controlled foreign corporation regardless of whether such controlled foreign corporation makes any distributions. Failure to comply with these reporting obligations (or related tax payment obligations) may subject such United States shareholder to significant monetary penalties and may prevent the statute of limitations with respect to such United States shareholder s U.S. federal income tax return for the year for which reporting (or payment of tax) was due from starting. An individual that is a United States shareholder with respect to a controlled foreign corporation generally would not be allowed certain tax deductions or foreign tax credits that would be allowed to a United States shareholder that is a U.S. corporation. We cannot provide any assurances that we will assist holders in determining whether any of our non-U.S. subsidiaries are treated as a controlled foreign corporation or whether any holder is treated as a United States shareholder with respect to any of such controlled foreign corporations or furnish to any holder information that may be necessary to comply with reporting and tax paying obligations.
+
+ Risks Related to Doing Business in Jurisdictions in Which We Operate
+
+ Continued hostilities and unrest in the MENA Region or changes in the economic, social and political environment in the MENA Region could have an adverse impact on our business.
+
+ It is difficult for us to predict the consequences of any political and socio-economic change that may be brought about as a result of the unrest in several countries in the MENA Region, or what the implications of such changes will be on our operations given that legislative, tax and business environments can be altered quickly and dramatically. Accordingly, our ability to operate our businesses regularly and our willingness to commit new resources or investments may be affected or disrupted, potentially with corresponding reductions in revenue, more aggressive taxation policies, increases in other expenses, restrictions on repatriating funds and difficulties in recruiting staff. Such risks may have a material adverse effect on our business, financial condition, results of operations and/or prospects.
+
+ Additionally, as a substantial part of our assets and operations are currently located in jurisdictions which are, have been, or could in the future be subject to political, economic and social instability, our operating results were and will be affected by any economic, social and political developments that affect each of the countries in which we operate and, in particular, by the level of economic activity. Economic, social and political instability leads to uncertainty over future economic conditions and policy decisions. Prolonged disruptions of business operations due to any political or social instability could adversely affect our business.
+
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+ Further incidents of political or social instability, terrorism, protests or violence may directly or indirectly affect the economies of the markets in which we operate, which, in turn, could have a material adverse effect on our business, prospects, financial condition, cash flows or results of operations.
+
+ We are subject to the economic and political conditions of operating in an emerging market and operates against a backdrop of continued instability and unrest in the Middle East.
+
+ Our headquarters are in the UAE and, accordingly, our results of operations are, and will continue to be, generally affected by financial, economic and political developments in or affecting Abu Dhabi, the UAE and the Middle East. It is not possible to predict the occurrence of events or circumstances, such as war or hostilities, or the impact of such occurrences, and no assurance can be given that we would be able to sustain the operation of our business if adverse political events or circumstances were to occur. A general downturn or instability in certain sectors of the UAE or the regional economy could have an adverse effect on our business, financial condition, results of operations and prospects.
+
+ Although economic growth rates in the UAE remain above those of many more developed, as well as regional, markets, the UAE has experienced slower economic growth in recent years, following the sharp decline in oil prices in recent years, which remain volatile and below historic highs. Economic growth or performance in the UAE, in general, may not be sustained. The UAE s wealth remains largely based on oil and gas. Despite the UAE being viewed as being less vulnerable than some of our neighbors, due to the growth in the non-oil sector and the sizeable wealth of the government of Abu Dhabi, fluctuations in energy prices have an important bearing on economic growth. To the extent that economic growth or performance in the UAE subsequently declines, our business, financial condition and results of operations may be adversely affected. In addition, the implementation by the governments of the UAE of restrictive fiscal or monetary policies or regulations, including in respect of interest rates, or new legal interpretations of existing regulations and the introduction of taxation or exchange controls could have a material adverse effect on our business, financial condition, results of operations and prospects.
+
+ While the UAE is seen as a relatively stable political environment, certain other jurisdictions in the Middle East are not and there is a risk that regional geopolitical instability could impact the UAE. Instability in the Middle East may result from a number of factors, including government or military regime change, civil unrest or terrorism. In particular, since early 2011 there has been political unrest in a range of countries in the MENA Region, including the Arab Republic of Egypt, Algeria, the Hashemite Kingdom of Jordan, Libya, the Kingdom of Bahrain, the Kingdom of Saudi Arabia, the Republic of Yemen, the Republic of Iraq (Kurdistan), Syria, Palestine, the Republic of Turkey, Tunisia and the Sultanate of Oman.
+
+ This unrest has ranged from public demonstrations to, in extreme cases, armed conflict (for example, the multinational conflict in Syria with Islamic State (also known as Daesh, ISIS or ISIL)) and the overthrow or potential overthrow of existing leadership in various countries and has given rise to increased political uncertainty across the region. Further, the UAE, along with other Arab states, is currently participating in the Saudi Arabian led intervention in the Republic of Yemen which began in 2015 in response to requests for assistance from the Yemeni government against the Al Houthi militia. The UAE is also a member of another Saudi Arabian led coalition formed in December 2015 to combat Islamic extremism and, in particular, Islamic State.
+
+ These situations have caused significant disruption to the economies of affected countries and have had a destabilizing effect on international oil and gas prices. Continued instability affecting the countries in the MENA Region could adversely impact the UAE although to date there has been no significant impact on the UAE. In particular, such continuing instability and unrest in the MENA Region may significantly affect the sectors in which we do business, financial markets and the real economy generally. The consequences of such instability include a decrease in foreign direct investment into the region, capital outflows or increased volatility in the global and regional financial markets.
+
+ Any of the foregoing circumstances could have a material adverse effect on the political and economic stability of the Middle East and the UAE and, consequently, could have an adverse effect on our business, financial condition, results of operations and prospects.
+
+ It is not possible to predict the occurrence of events or circumstances such as terrorism, war or hostilities, or more generally the financial, political and economic conditions prevailing from time to time, or the impact of such occurrences or conditions, and no assurance can be given that we would be able to be profitable if adverse financial, 
+
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+ political or economic events or circumstances were to occur. A general downturn or instability in certain sectors of the UAE or the regional economy, or political upheaval therein, could have an adverse effect on our business, results of operations and financial condition. Investors should also note that our business and financial performance could be adversely affected by political, economic or related developments both within and outside the MENA Region because of interrelationships within the global financial markets.
+
+ Prospective investors should also be aware that investments in emerging markets, such as the UAE, are subject to greater risks than those in more developed markets. The economy of the UAE, like those of many emerging markets, has been characterized by significant government involvement through direct ownership of enterprises and extensive regulation of market conditions, including foreign investment, foreign trade and financial services. While the policies of the local and central governments of the UAE generally resulted in improved economic performance in previous years, there can be no assurance that these levels of performance can be sustained.
+
+ Our business operations could be adversely affected by terrorist attacks and political instability, and other events beyond our control.
+
+ Terrorist activity in the MENA Region stemming from the ongoing political instability and civil war in certain countries, including Syria and Iraq, has had an adverse effect on consumer appetite and demand in general. There have been a number of terrorist attacks in various countries, which are claimed to be conducted by the terrorist organization and despite the recent loss of military might and territory of such organization in Syria and Iraq, there is no assurance that no such attempts will be carried out in the near future. The MENA Region has generally also experienced domestic political instability caused by ethnic separatist groups. Our business, financial condition, results of operations or liquidity could be adversely affected if such terrorist activity heightens and spreads into cities where we operate.
+
+ We do business in locations where we are exposed to a greater-than-average risk of adverse sovereign action.
+
+ We do business in locations where we are exposed to a greater-than-average risk of adverse sovereign action, including overt or effective expropriation or nationalization of property. Furthermore, relatively high commodity prices and other factors in recent years have resulted in increased resource nationalization in some countries, with governments repudiating or renegotiating contracts with, and expropriating assets from, companies that are producing in such countries. Governments in these countries may decide not to recognize previous arrangements if they regard them as no longer being in the national interest. Governments may also implement export controls on commodities regarded by them as strategic or place restrictions on foreign ownership or operation of strategic assets. Governments of the countries in which we operate may adopt nationalization, expropriation, or export control policies going forward. Expropriation of assets, renegotiation or nullification of existing agreements, leases or permits by the governments of countries in which we operate, could each have a material adverse effect on our business, results of operations, financial condition and/or prospects.
+
+ Additionally, although not direct sovereign actions, certain countries have passed laws to favor their own economic growth. For instance, Saudi Arabia will no longer sign contracts with foreign companies that do not have regional headquarters in the kingdom after 2023. If the governments of countries in which we operate create similar requirements, we could be required to expend additional resources to meet such requirements and this could adversely affect our business, results of operations, and financial condition.
+
+ We operate in regions where corrupt behavior exists that could impair our ability to do business in the future or result in significant fines or penalties.
+
+ We do business, and may continue to do business in the future, in countries and regions where governmental corruption has been known to exist, and where we may face, directly or indirectly, corrupt demands by officials, or the risk of unauthorized payments or offers of payments by one of our employees, consultants, sponsors or agents. Our existing anti-corruption safeguards and policies and any future improvements thereon may prove to be not fully effective in preventing such unauthorized payments, and our employees and consultants may engage in conduct for which we might be held responsible. While we are committed to conducting business in a legal and ethical manner, there is a risk of violating applicable anti-corruption regulations that generally prohibit the making of improper 
+
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+ payments to foreign officials for the purpose of obtaining or keeping business. Violation of these laws may result in severe criminal or civil sanctions or other liabilities that could materially damage our reputation and, therefore, our business, results of operations and financial condition.
+
+ Risks Related to Owning Our Securities
+
+ The trading price of our ordinary shares has been and will likely continue to be volatile. 
+
+ The trading price of our ordinary shares has been and is likely to continue to be volatile. Since the closing of our business combination on February 3, 2022 through June 1, 2022, the trading price of our ordinary shares ranged from $5.75 to $33.13. The market price of our ordinary shares may fluctuate or decline significantly in response to the factors enumerated in this prospectus, as well as other factors, many of which are beyond our control, including: 
+
+ quarterly variations in our results of operations or those of our competitors;
+
+ the accuracy of our financial guidance or projections;
+
+ our announcements or our competitors announcements regarding new services, enhancements, significant contracts, acquisitions, or strategic investments;
+
+ the overall performance of the equity markets, including fluctuations due to general economic uncertainty or negative market sentiment, in particular related to the COVID-19 pandemic;
+
+ any major change in our board of directors or management;
+
+ publication of research reports about us or our industry or changes in recommendations or withdrawal of research coverage by securities analysts; and
+
+ the exercises of our warrants or redemptions of warrants by us; and sales or expected sales, or repurchases or expected repurchases, of our ordinary shares by us, and our officers, directors, and significant shareholders. See Future sales, or the perception of future sales, of our ordinary shares and/or warrants being offered by us or our existing securityholders may cause the market price of such securities to decline significantly. 
+
+ In addition, the stock market in general, and the market for technology companies in particular, have experienced extreme price and volume fluctuations that often have been unrelated or disproportionate to the operating performance of those companies. Price volatility over a given period may cause the average price at which the Company repurchases its ordinary shares to exceed the trading price at a given point in time. Securities class action litigation has often been instituted against companies following periods of volatility in the overall market and in the market price of a company s securities. Such litigation, if instituted against us, could result in very substantial costs, divert our management s attention and resources and harm our business, operating results, and financial condition.
+
+ An active and liquid trading market for our ordinary shares may not develop, the market price may be volatile and investors may suffer a loss.
+
+ Prior to the Business Combination, there was no public market for our ordinary shares. As required in connection with the Business Combination, our shares were listed on Nasdaq on February 4, 2022. However, there can be no assurance that an active and liquid trading market for our ordinary shares will develop or be maintained. Active, liquid trading markets generally result in lower price volatility and more efficient execution of buy and sell orders for investors. The actual market price of the ordinary shares may fluctuate because of several factors, including those described in this section Risk Factors, may not reflect our actual operating performance and may be lower than the price investors paid to purchase the ordinary shares.
+
+ There can be no assurance that our warrants will be in-the-money at any time, and they may expire worthless.
+
+ The exercise price for our warrants is $11.50 per ordinary share. There can be no assurance that our warrants will be in-the-money at any time that our warrants are exercisable and prior to their expiration, and as such, our warrants may expire worthless. We cannot provide assurance that the trading price of our ordinary shares will be attractive to exercise our outstanding warrants.
+
+ 
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+ The exercise of our warrants would increase the number of shares eligible for future resale in the public market and result in dilution to our shareholders.
+
+ As of May 12, 2022, we had 10,872,800 warrants outstanding. To the extent our warrants are exercised, additional ordinary shares will be issued, which will result in dilution to the holders of ordinary shares and potentially increase the number of shares eligible for resale in the public market, which could cause a decline in the price of our ordinary shares. Sales of substantial numbers of ordinary shares in the public market could adversely affect the market price of our ordinary shares and warrants. See Future sales, or the perception of future sales, of our ordinary shares and/or warrants being offered by us or our existing securityholders may cause the market price of such securities to decline significantly. 
+
+ Future sales, or the perception of future sales, of our ordinary shares and/or warrants being offered by us or our existing securityholders may cause the market price of such securities to decline significantly.
+
+ This prospectus relates to the offer and sale from time to time by the selling securityholders of up to 15,900,264 ordinary shares (excluding any shares to be issued upon the exercise of warrants), which constitutes 61% of our total outstanding ordinary shares as of May 12, 2022, and the issuance by us of up to 10,872,800 ordinary shares issuable upon exercise of our warrants, which upon exercise would together with the ordinary shares to which this prospectus relates would constitute 103% of our current total outstanding ordinary shares if all such warrants were exercised for cash. In addition, approximately 3,378,845 of our ordinary shares are not subject to a lock-up agreement, held by an affiliate or subject to a Securities Act restricted legend and the ordinary shares offered by the selling securityholders (excluding any shares to be issued upon the exercise of warrants) constitute approximately 470% of such shares as of May 12, 2022. The sale of substantial amounts of our ordinary shares or warrants being offered in this prospectus, or the perception that such sales could occur, could harm the prevailing market price of shares of our ordinary shares and warrants. These sales, or the possibility that these sales may occur, also might make it more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate. We believe that the likelihood that warrant holders will exercise their warrants, and therefore the amount of cash proceeds that we would receive, is dependent upon the market price of our ordinary shares. If the market price for our ordinary shares is less than the exercise price of the warrants (on a per share basis), we believe warrant holders will be unlikely to exercise the warrants.
+
+ In connection with the Business Combination, the Company entered into lock-up agreement covering a total of 18,005,809 shares of which the lock-up agreements with respect to (i) 295,000 shares expired on the date that was 30 days after the closing date of the Business Combination, (ii) 15,210,809 shares expire on the date that is six months after the closing date of the Business Combination, and (iv) 2,500,000 shares held by the Sponsor and certain of its affiliates that expire on the earlier of (A) one year after the completion of the Business Combination and (B) subsequent to the Business Combination, (x) if the closing price of Ordinary Shares equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the Business Combination. However, following the expiration of the applicable lock-up periods, such securityholders will not be restricted from selling ordinary shares held by them, other than by applicable securities laws. Additionally, the purchasers of the PIPE shares and the ordinary shares of the Company issued in exchange for the PIPE shares at the closing of the Business Combination will not be restricted from selling any of their shares of the ordinary shares, other than by applicable securities laws. As such, sales of a substantial number of shares of ordinary shares of the Company in the public market could occur at any time. These sales, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of our ordinary shares. In addition, the Sponsor, I-Bankers, VMAC s former directors and officers, the SPAC Insiders and certain of our shareholders have been granted certain rights, pursuant to the Amended and Restated Registration Rights Agreement, to require us to register, in certain circumstances, the resale under the Securities Act of their ordinary shares or warrants held by them, subject to certain conditions, and to certain demand, piggy-back and shelf registration rights. As restrictions on resale end and registration statements (to provide for the resale of such shares from time to time) are available for use, the sale or possibility of sale of these shares could have the effect of increasing the volatility in the market price of our ordinary shares, and the market price of our ordinary shares could decline if the holders of currently restricted shares sell them or are perceived by the market as intending to sell them.
+
+ 
+
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+ Certain of the selling securityholders acquired their shares at a price that is less than the market price of our ordinary shares as of the date of this prospectus, may earn a positive rate of return even if the price of our ordinary shares declines and may be willing to sell their shares at a price less than shareholders that acquired our shares in the public market.
+
+ Certain of our securityholders may have purchased their respective ordinary shares and/or warrants at prices lower than current market prices and may therefore experience a positive rate of return on their investment, even if our public securityholders experience a negative rate of return on their investment. In particular, prior to the consummation of VMAC s IPO, Sponsor purchased 2,875,000 Class B shares of VMAC ( Founder Shares ), which were converted into ordinary shares at the closing of the Business Combination, for an aggregate purchase price of $25,000, or approximately $0.009 per share. Of these Founder Shares, 375,000 were forfeited by our Sponsor due to the underwriters not exercising the over-allotment option in connection with the IPO. As a result, the Sponsor and other shareholders are able to recognize a greater return on their investment than shareholders or holders of warrants that purchased VMAC common stock or VMAC warrants in VMAC s IPO, in the public market thereafter, or our ordinary shares after the closing of the Business Combination. Furthermore, such shareholders may earn a positive rate of return even if the price of our ordinary shares and/or warrants declines significantly. As a result, such securityholders may be willing to sell their shares and/or warrants at a price less than shareholders that acquired our shares in the public market or at higher prices than the price paid by such securityholders. The sale or possibility of sale of these ordinary shares and/or warrants, including those pursuant to this prospectus, could have the effect of increasing the volatility in ordinary share and warrant price or putting significant downward pressure on the price of ordinary shares and/or warrants. For more details concerning the prices at which the selling securityholders acquired their securities, see the section entitled Selling Securityholders. 
+
+ Offers or availability for sale of a substantial number of shares of our ordinary shares may cause the price of our ordinary shares to decline and could make more difficult our ability to raise additional financing through the sale of equity or equity-related securities in the future.
+
+ If our shareholders sell or may sell substantial amounts of our ordinary shares in the public market upon the expiration of any statutory holding period or lockup agreements or issued upon the exercise of outstanding warrants or other convertible securities, it could create a circumstance commonly referred to as an overhang and in anticipation of which the market price of our ordinary shares could fall. The existence of an overhang, whether or not sales have occurred or are occurring, also could make more difficult our ability to raise additional financing through the sale of equity or equity-related securities in the future at a time and price that we deem reasonable or appropriate.
+
+ We may redeem your unexpired public warrants prior to their exercise at a time that is disadvantageous to you, thereby making your Warrants worthless.
+
+ We have the ability to redeem outstanding warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided that the closing price of our ordinary shares equals or exceeds $18.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like) on each of 20 trading days within a 30 trading-day period ending on the third trading day prior to proper notice of such redemption, and provided further that there is an effective registration statement covering the ordinary shares issuable upon exercise of the warrants, and a current prospectus relating thereto, available throughout the 30-day redemption period, or we have elected to require the exercise of the warrants on a cashless basis, and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. Redemption of the outstanding warrants could force holders (i) to exercise the warrants and pay the exercise price therefor at a time when it may be disadvantageous to do so, (ii) to sell the warrants at the then-current market price when the holder might otherwise wish to hold its warrants, or (iii) to accept the nominal redemption price which, at the time the outstanding warrants are called for redemption, is likely to be substantially less than the market value of the warrants. Certain warrants held by Sponsor or its permitted transferees are not redeemable by us so long as they continue to be held by the Sponsor or its permitted transferees.
+
+ 
+
+ 40
+
+ Table of Contents
+
+ 
+ If we do not maintain a current and effective prospectus relating to the ordinary shares issuable upon exercise of our warrants, then holders may only be able to exercise the warrants on a cashless basis. 
+
+ If we do not maintain a current and effective prospectus relating to our ordinary shares issuable upon exercise of our warrants, at the time that holders wish to exercise such warrants, then they may only be able to exercise them on a cashless basis to the extent permitted by the terms of the warrant agreement. As a result, the number of ordinary shares that holders will receive upon exercise of the warrants will be fewer than it would have been had such holders exercised their warrants for cash. Under the terms of the warrant agreement, we have agreed to use our best efforts to maintain a current and effective prospectus relating to the ordinary shares issuable upon exercise of the warrants until the expiration of the warrants. However, we cannot assure you that we will be able to do so in a timely manner or at all. If we are unable to continue to maintain a current and effective prospectus, and there is a right existing under the terms of the warrant agreement to exercise the warrants on a cashless basis, the potential upside of the holder s investment in the Company may be reduced.
+
+ Reports published by analysts, including projections in those reports that differ from our actual results, could adversely affect the price and trading volume of our shares.
+
+ Securities research analysts may establish and publish their own periodic projections for Anghami. These projections may vary widely and may not accurately predict the results we actually achieve. Our share price may decline if our actual results do not match the projections of these securities research analysts. Similarly, if one or more of the analysts who write reports on us downgrades our stock or publishes inaccurate or unfavorable research about our business, our share price could decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, our share price or trading volume could decline.
+
+ Provisions in our articles of association may delay or prevent our acquisition by a third party. 
+
+ Our articles of association contain provisions that may make it more difficult or expensive for a third party to acquire control of us without the approval of our board of directors and, if required, our shareholders. These provisions also may delay, prevent, or deter a merger, acquisition, tender offer, proxy contest, or other transaction that might otherwise result in our shareholders receiving a premium over the market price for their ordinary shares. The provisions of our articles of association could discourage potential takeover attempts and reduce the price that investors might be willing to pay for our ordinary shares in the future, which could reduce the trading price of our ordinary shares.
+
+ We do not expect to pay cash dividends in the foreseeable future.
+
+ We have never declared or paid any cash dividends on our share capital. We currently intend to retain any future earnings for working capital and general corporate purposes and do not expect to pay dividends or other distributions on our ordinary shares in the foreseeable future. As a result, you may only receive a return on your investment in our ordinary shares if you sell some or all of your ordinary shares after the trading price of our ordinary shares increases. You may not receive a gain on your investment when you sell your ordinary shares and you may lose the entire amount of the investment.
+
+ Moreover, we are a holding company and have no material assets other than our direct and indirect ownership of shares in our subsidiaries. Our ability to pay any future dividends is subject to restrictions on the ability of our subsidiaries to pay dividends or make distributions to us, including the laws of the relevant jurisdiction in which the subsidiaries are organized or located, as well as any restrictions in the future indebtedness of our subsidiaries or on our ability to receive dividends or distributions from our subsidiaries. Since we are expected to rely primarily on dividends from our direct and indirect subsidiaries to fund our financial and other obligations, restrictions on our ability to receive such funds may adversely impact our ability to fund our financial and other obligations.
+
+ 
+
+ 41
+
+ Table of Contents
+
+ 
+ Risks Related to Our Status as a Foreign Private Issuer
+
+ As a foreign private issuer, we are exempt from a number of U.S. securities laws and rules promulgated thereunder and are permitted to publicly disclose less information than U.S. public companies must. This may limit the information available to holders of the ordinary shares.
+
+ We currently qualify as a foreign private issuer, as defined in the rules and regulations of the SEC, and, consequently, we are not subject to all of the disclosure requirements applicable to companies organized within the United States. For example, we are exempt from certain rules under the U.S. Securities Exchange Act of 1934, as amended (the Exchange Act ) that regulate disclosure obligations and procedural requirements related to the solicitation of proxies, consents or authorizations applicable to a security registered under the Exchange Act. In addition, our officers and directors are exempt from the reporting and short-swing profit recovery provisions of Section 16 of the Exchange Act and related rules with respect to their purchases and sales of our securities. For example, some of our key executives may sell a significant amount of ordinary shares and such sales will not be required to be disclosed as promptly as companies organized within the United States would have to disclose. Accordingly, once such sales are eventually disclosed, the price of ordinary shares may decline significantly. Moreover, we are not required to file periodic reports and financial statements with the SEC as frequently or as promptly as U.S. public companies. We are also not subject to Regulation FD under the Exchange Act, which would prohibit us from selectively disclosing material nonpublic information to certain persons without concurrently making a widespread public disclosure of such information. Accordingly, there may be less publicly available information concerning our company than there is for U.S. public companies.
+
+ As a foreign private issuer, we are required to file an annual report on Form 20-F within four months of the close of each fiscal year ended December 31 and furnish reports on Form 6-K relating to certain material events promptly after we publicly announce these events. However, because of the above exemptions for foreign private issuers, our shareholders may not always be afforded the same information generally available to investors holding shares in public companies that are not foreign private issuers.
+
+ We may lose our foreign private issuer status in the future, which could result in significant additional costs and expenses. This would subject us to U.S. GAAP reporting requirements which may be difficult for us to comply with.
+
+ As a foreign private issuer, we are not required to comply with all of the periodic disclosure and current reporting requirements of the Exchange Act and related rules and regulations. Under those rules, the determination of foreign private issuer status is made annually on the last business day of an issuer s most recently completed second fiscal quarter, and, accordingly, the next determination will be made with respect to us on June 30, 2022.
+
+ In the future, we could lose our foreign private issuer status if a majority of our ordinary shares are held by residents in the United States and we fail to meet any one of the additional business contacts requirements. Although we intend to follow certain practices that are consistent with U.S. regulatory provisions applicable to U.S. companies, Our loss of foreign private issuer status would make such provisions mandatory. The regulatory and compliance costs to us under U.S. securities laws if we are deemed a U.S. domestic issuer may be significantly higher. If we are not a foreign private issuer, we will be required to file periodic reports and prospectuses on U.S. domestic issuer forms with the SEC, which are more detailed and extensive than the forms available to a foreign private issuer. For example, we would become subject to the Regulation FD, aimed at preventing issuers from making selective disclosures of material information. We also may be required to modify certain of our policies to comply with good governance practices associated with U.S. domestic issuers. Such conversion and modifications will involve additional costs. In addition, we may lose our ability to rely upon exemptions from certain corporate governance requirements of Nasdaq that are available to foreign private issuers. For example, Nasdaq s corporate governance rules require listed companies to have, among other things, a majority of independent board members and independent director oversight of executive compensation, nomination of directors, and corporate governance matters. Nasdaq rules also require shareholder approval of certain share issuances, including approval of equity compensation plans. As a foreign private issuer, we are permitted to follow home country practice in lieu of the above requirements. While we are not currently using the following exemptions from certain Nasdaq corporate governance standards as of the date of this annual report, as long as we rely on the foreign private issuer exemption to certain of Nasdaq s corporate governance standards, a majority of the directors on our board of directors are not required to be independent directors, our remuneration committee is not required to be comprised entirely of independent directors and we will not be required to have a nominating and corporate governance committee. Also, 
+
+ 
+
+ 42
+
+ Table of Contents
+
+ 
+ we would be required to change our basis of accounting from IFRS as issued by the IASB to U.S. GAAP, which may be difficult and costly for us to comply with. If we lose our foreign private issuer status and fails to comply with U.S. securities laws applicable to U.S. domestic issuers, we may have to de-list from Nasdaq and could be subject to investigation by the SEC, Nasdaq and other regulators, among other materially adverse consequences.
+
+ Because we are incorporated under the laws of the Cayman Islands, you may face difficulties in protecting your interests, and your ability to protect your rights through the U.S. Federal courts may be limited.
+
+ We are an exempted company incorporated under the laws of the Cayman Islands. As a result, it may be difficult for investors to effect service of process within the United States upon our directors or officers, or enforce judgments obtained in the United States courts against our directors or officers.
+
+ Our corporate affairs will be governed by our amended and restated memorandum and articles of association, the Companies Law (as the same may be supplemented or amended from time to time) and the common law of the Cayman Islands. We will also be subject to the federal securities laws of the United States. The rights of shareholders to take action against the directors, actions by minority shareholders and the fiduciary responsibilities of our directors to us under Cayman Islands law are to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands is derived in part from comparatively limited judicial precedent in the Cayman Islands as well as from English common law, the decisions of whose courts are of persuasive authority, but are not binding on a court in the Cayman Islands. The rights of our shareholders and the fiduciary responsibilities of our directors under Cayman Islands law are different from what they would be under statutes or judicial precedent in some jurisdictions in the United States. In particular, the Cayman Islands has a different body of securities laws as compared to the United States, and certain states, such as Delaware, may have more fully developed and judicially interpreted bodies of corporate law. In addition, Cayman Islands companies may not have standing to initiate a shareholders derivative action in a Federal court of the United States.
+
+ We have been advised by Maples and Calder (Dubai) LLP, our Cayman Islands legal counsel, that the courts of the Cayman Islands are unlikely (i) to recognize or enforce against us judgments of courts of the United States predicated upon the civil liability provisions of the federal securities laws of the United States or any state; and (ii) in original actions brought in the Cayman Islands, to impose liabilities against us predicated upon the civil liability provisions of the federal securities laws of the United States or any state, so far as the liabilities imposed by those provisions are penal in nature. In those circumstances, although there is no statutory enforcement in the Cayman Islands of judgments obtained in the United States, the courts of the Cayman Islands will recognize and enforce a foreign money judgment of a foreign court of competent jurisdiction without retrial on the merits based on the principle that a judgment of a competent foreign court imposes upon the judgment debtor an obligation to pay the sum for which judgment has been given provided certain conditions are met. For a foreign judgment to be enforced in the Cayman Islands, such judgment must be final and conclusive and for a liquidated sum, and must not be in respect of taxes or a fine or penalty, inconsistent with a Cayman Islands judgment in respect of the same matter, impeachable on the grounds of fraud or obtained in a manner, or be of a kind the enforcement of which is, contrary to natural justice or the public policy of the Cayman Islands (awards of punitive or multiple damages may well be held to be contrary to public policy). A Cayman Islands court may stay enforcement proceedings if concurrent proceedings are being brought elsewhere.
+
+ As a result of all of the above, public shareholders may have more difficulty in protecting their interests in the face of actions taken by management, members of the board of directors or controlling shareholders than they would as public shareholders of a corporation incorporated in the United States.
+
+ It may be difficult to enforce a U.S. judgment against us or our directors and officers outside the United States, or to assert U.S. securities law claims outside of the United States.
+
+ A number of our directors and executive officers are not residents of the United States, and the majority of our assets and the assets of these persons are located outside the United States. As a result, it may be difficult or impossible for investors to effect service of process upon us within the United States or other jurisdictions, including judgments predicated upon the civil liability provisions of the federal securities laws of the United States. Additionally, it may be difficult to assert U.S. securities law claims in actions originally instituted outside of the United States. Foreign courts may refuse to hear a U.S. securities law claim because foreign courts may not be the most appropriate forum in which to bring such a claim. Even if a foreign court agrees to hear a claim, it may 
+
+ 
+
+ 43
+
+ Table of Contents
+
+ 
+ determine that the law of the jurisdiction in which the foreign court resides, and not U.S. law, is applicable to the claim. Further, if U.S. law is found to be applicable, the content of applicable U.S. law must be proved as a fact, which can be a time-consuming and costly process, and certain matters of procedure would still be governed by the law of the jurisdiction in which the foreign court resides. 
+
+ As a company incorporated in the Cayman Islands, we are permitted to adopt certain home country practices in relation to corporate governance matters that differ significantly from Nasdaq corporate governance listing standards; these practices may afford less protection to shareholders than they would enjoy if we complied fully with Nasdaq corporate governance listing standards.
+
+ We are a company incorporated in the Cayman Islands, and our ordinary shares and warrants are listed on Nasdaq. Nasdaq market rules permit a foreign private issuer like us to follow the corporate governance practices of our home country. Certain corporate governance practices in the Cayman Islands, which is our home country, may differ significantly from Nasdaq corporate governance listing standards.
+
+ Among others, we are not required to: (i) have a majority of the board be independent; (ii) have a compensation committee consisting entirely of independent directors; (iii) have a minimum of three members on the audit committee; (iv) obtain shareholders approval for issuance of securities in certain situations; or (v) have regularly scheduled executive sessions with only independent directors each year.
+
+ Provisions in our governance documents may inhibit a takeover of us, which could limit the price investors might be willing to pay in the future for ordinary shares and could entrench management.
+
+ Our governance documents contain provisions that may discourage unsolicited takeover proposals that shareholders may consider to be in their best interests. These provisions include that our board of directors is classified into three classes of directors. As a result, in most circumstances, a person can gain control of the board only by successfully engaging in a proxy contest at two or more annual general meetings. We may issue additional shares without shareholder approval and such additional shares could be utilized for a variety of corporate purposes, including future offerings to raise additional capital, acquisitions and employee benefit plans. The ability for us to issue additional shares could render more difficult or discourage an attempt to obtain control of us by means of a proxy contest, tender offer, merger or otherwise that could involve the payment of a premium over prevailing market prices for ordinary shares.
+
+ The JOBS Act permits emerging growth companies like us to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies.
+
+ We currently qualify as an emerging growth company as defined in Section 2(a)(19) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, which we refer to as the JOBS Act. As such, we take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies for as long as we continue to be an emerging growth company, including the exemption from the auditor attestation requirements with respect to internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act. As a result, our shareholders may not have access to certain information they deem important.
+
+ In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the exemption from complying with new or revised accounting standards provided in Section 7(a)(2)(B) of the Securities Act as long as we are an emerging growth company. An emerging growth company can therefore delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies, but any such election to opt out is irrevocable.
+
+ We cannot predict if investors will find ordinary shares or warrants less attractive because we rely on these exemptions. If some investors find ordinary shares or warrants less attractive as a result, there may be a less active trading market and share price for ordinary shares may be more volatile. When we cease to qualify as an emerging growth company, we may incur increased legal, accounting and compliance costs associated with Section 404 of the Sarbanes-Oxley Act.
+
+ 
+
+ 44
+
+ Table of Contents
+
+ 
+ USE OF PROCEEDS
+
+ All of the ordinary shares and warrants offered by the selling securityholders pursuant to this prospectus will be sold by the selling securityholders for their respective accounts. We will not receive any of the proceeds from these sales.
+
+ We would receive up to an aggregate of approximately $125,037,200 from the exercise of the warrants, assuming the exercise in full of all such warrants for cash. We expect to use the net proceeds from the exercise of the warrants for general corporate purposes, which may include the repayment of indebtedness. Our management will have broad discretion over the use of proceeds from the exercise of the warrants.
+
+ There is no assurance that the holders of the warrants will elect to exercise any or all of the warrants. The closing price of our ordinary shares on the Nasdaq on June 1, 2022 was $6.79 per ordinary share, and the closing price of our public warrants on June 1, 2022 was $0.37. If the price of our ordinary shares remains below the exercise price of our warrants of $11.50 per ordinary share, we believe it is unlikely that any warrant holder will exercise their warrants. In addition, to the extent that any of the warrants are exercised on a cashless basis, as may be permitted in certain circumstances, the amount of cash we would receive from the exercise of the warrants will decrease. See the section entitled Risk Factors Risks Related to Our Operations Warrant holders may not elect to exercise any of their warrants which could significantly reduce the amount of cash we could receive from the exercise of the warrants. 
+
+ 
+
+ 45
+
+ Table of Contents
+
+ 
+ DIVIDEND POLICY
+
+ We have never declared or paid any cash dividends on our ordinary shares. We currently intend to retain any future earnings, if any, and do not expect to pay any dividends in the foreseeable future. Any further determination to pay dividends on our ordinary shares would be at the discretion of our board of directors, subject to applicable laws, and would depend on our financial condition, results of operations, capital requirements, general business conditions, and other factors that our board of directors may deem relevant.
+
+ 
+
+ 46
+
+ Table of Contents
+
+ 
+ CAPITALIZATION
+
+ The following table sets forth our cash and cash equivalents and total capitalization as of December 31, 2021 on:
+
+ a historical basis; and
+
+ on an unaudited pro forma basis after giving effect to the Business Combination and the PIPE.
+
+ The information in this table should be read in conjunction with our audited consolidated financial statements and notes thereto, and other financial information included in this prospectus and any prospectus supplement and the information under Unaudited Pro Forma Combined Financial Information and Management s Discussion and Analysis of Financial Condition and Results of Operations. Our historical results do not necessarily indicate our expected results for any future periods.
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ As of 
+December 31, 2021
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Historical 
+$
+
+ 
+ 
+ 
+ Pro Forma 
+$
+
+ 
+ 
+
+ 
+ 
+ Cash and cash equivalents
+
+ 
+ 
+ 
+ 649,972
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 22,264,947
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Liabilities
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Non-Current
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Provision for employees end-of-service benefits
+
+ 
+ 
+ 
+ 166,013
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 166,013
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Derivative warrant liabilities
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 7,625,996
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Lease liabilities
+
+ 
+ 
+ 
+ 135,967
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 135,967
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Government grants
+
+ 
+ 
+ 
+ 310,163
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 310,163
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Deferred tax liabilities
+
+ 
+ 
+ 
+ 14,625
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 14,625
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Non-current Liabilities
+
+ 
+ 
+ 
+ 626,768
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 8,252,764
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Current
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Trade and other payables
+
+ 
+ 
+ 
+ 15,892,129
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 15,892,129
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Government grants
+
+ 
+ 
+ 
+ 81,606
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 81,606
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Contract liabilities
+
+ 
+ 
+ 
+ 3,150,431
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 3,150,431
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Loans and borrowings
+
+ 
+ 
+ 
+ 18,526,802
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Amount due to related parties
+
+ 
+ 
+ 
+ 2,070,847
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 4,295,807
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Income tax payables
+
+ 
+ 
+ 
+ 518,500
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 518,500
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Bank overdrafts
+
+ 
+ 
+ 
+ 17,432
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 17,432
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Lease liabilities
+
+ 
+ 
+ 
+ 104,233
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 104,233
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Current Liabilities
+
+ 
+ 
+ 
+ 40,361,980
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 24,060,138
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Total Liabilities
+
+ 
+ 
+ 
+ 40,988,748
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 32,312,902
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Shareholders Equity
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Anghami
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Share capital
+
+ 
+ 
+ 
+ 8,540
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Share premium
+
+ 
+ 
+ 
+ 32,102,426
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Share-based payment reserves
+
+ 
+ 
+ 
+ 3,162,544
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Other reserves
+
+ 
+ 
+ 
+ (100,774
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Accumulated losses
+
+ 
+ 
+ 
+ (62,015,211
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Non-controlling interest
+
+ 
+ 
+ 
+ (1,120,946
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Anghami Inc.
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Ordinary share capital
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2,577
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Share premium reserve
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 106,093,121
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Share-based payment reserves
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 3,162,544
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Other reserves
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (100,774
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Accumulated losses
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (105,709,122
+
+ 
+ 
+ ) 
+
+ 
+ 
+
+ 
+ 
+ Non-controlling interest
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (1,120,946
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Deficiency of assets/equity
+
+ 
+ 
+ 
+ (27,963,421
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 2,327,400
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Total Capitalization
+
+ 
+ 
+ 
+ 13,025,327
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 34,640,302
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+
+ 47
+
+ Table of Contents
+
+ 
+ UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION
+
+ Introduction
+
+ The following unaudited pro forma combined financial information is being provided for illustrative purposes only and should not be considered an indication of the results of operations or financial position of the Anghami Inc. (referred to herein as Anghami Inc. ) following the Transactions. The following has been prepared in accordance with Article 11 of Regulation S-X.
+
+ The unaudited pro forma combined statement of financial position as of December 31, 2021 combines the historical balance sheet of VMAC and statement of financial position of Anghami on a pro forma basis as if the Transactions, summarized below, had been consummated as of that date.
+
+ The unaudited pro forma combined statement of comprehensive income for the year ended December 31, 2021 combines the historical statement of comprehensive income of Anghami for the year ended December 31, 2021 and statement of operations of VMAC for the year ended December 31, 2021, giving effect to the transactions as if they had occurred as of January 1, 2021.
+
+ This information should be read together with the VMAC s audited financial statements and related notes thereto, and Anghami s audited financial statements and related notes thereto, the sections entitled Management s Discussion and Analysis of Financial Condition and Results of Operations and other financial information included elsewhere in this prospectus for the year ended December 31, 2021.
+
+ The unaudited pro forma combined statement of financial position as of December 31, 2021 has been prepared using the following:
+
+ Anghami s audited statement of financial position as of December 31, 2021, as included elsewhere in this prospectus; and
+
+ VMAC s audited historical balance sheet as of December 31, 2021, as included elsewhere in this prospectus.
+
+ The unaudited pro forma combined statement of comprehensive income for the year ended December 31, 2021 has been prepared using the following:
+
+ Anghami s audited statement of comprehensive income for the year ended December 31, 2021, as included elsewhere in this prospectus; and
+
+ VMAC s audited statement of operations for the year ended December 31, 2021, as included elsewhere in this prospectus.
+
+ The unaudited pro forma combined financial information has been presented for informational purposes only and is not necessarily indicative of what Anghami Inc. s actual financial position or results of operations would have been had the Transactions been completed as of the dates indicated. In addition, the unaudited pro forma combined financial information does not purport to project the future financial position or operating results of Anghami Inc.
+
+ The unaudited pro forma adjustments are based on information currently available. The assumptions and estimates underlying the unaudited pro forma adjustments are described in the accompanying notes. Actual results may differ materially from the assumptions used to present the unaudited pro forma combined financial information. As the unaudited pro forma combined financial information has been prepared based on preliminary estimates, the final amounts recorded may differ materially from the information presented. As a result, this unaudited pro forma combined financial information should be read in conjunction with the historical financial information included elsewhere in the prospectus.
+
+ 
+
+ 48
+
+ Table of Contents
+
+ 
+ Description of the Transactions
+
+ On February 3, 2022, the parties closed the Business Combination Agreement, by and among VMAC, Anghami, Anghami Inc., Vistas Merger Sub, and Anghami Merger Sub. The Business Combination Agreement, which contains customary representations and warranties, covenants, closing conditions, termination fee provisions and other terms relating to the mergers and the other transactions contemplated thereby. At the closing of the transactions contemplated by the Business Combination Agreement, the following transactions occurred: (i) VMAC closed the private placement in which it issued and sold 4,056,000 shares (the PIPE ), (ii) VMAC merged with and into Vistas Merger Sub, with VMAC surviving the merger and continuing as a subsidiary of Anghami Inc., with each outstanding share of VMAC converted into the right to receive one ordinary share and each outstanding warrant of VMAC converted into warrants to purchase ordinary shares on the same terms, and (iii) Anghami merged with and into Anghami Merger Sub, with Anghami surviving the merger and continuing as a subsidiary of Anghami Inc. and Anghami s shareholders receiving ordinary shares (together the Transactions ). Upon consummation of the Transactions, shareholders of VMAC and Anghami became shareholder of Anghami Inc.
+
+ Accounting for the Transactions
+
+ The exchange of Anghami s shares for Anghami Inc. s shares will be accounted for as a transaction under common control in accordance with IFRS. The exchange of VMAC s shares for Anghami Inc. s shares will be accounted for as a reverse acquisition in accordance with IFRS. Under this method of accounting, VMAC will be treated as the acquired company for financial reporting purposes.
+
+ This determination was based on the guidance provided in IFRS 3 (Business Combinations) and IFRS 10 (Consolidated Financial Statements) and was primarily based on the assumptions that Anghami s operations will substantially comprise the ongoing operations of the Combined Company, Anghami s designees are expected to comprise a majority of the governing body of the Combined Company, Anghami s senior management will comprise the senior management of the Combined Company, and Anghami s existing shareholders will be the largest group of shareholders of the Combined Company following the consummation of the Business Combination (Anghami s existing shareholders are expected to represent between 69.85% of the Combined Company).
+
+ Accordingly, for accounting purposes, the exchange of VMAC s shares for Anghami Inc. shares will be treated as the equivalent of Anghami Inc. issuing shares for the net assets of VMAC, accompanied by a recapitalization. It has been determined that VMAC is not a business under IFRS, hence the transaction is accounted for within the scope of IFRS 2 ( share-based payment ).
+
+ In accordance with IFRS 2, the difference in the fair value of Anghami Inc. s equity instruments deemed issued to VMAC shareholders over the fair value of identifiable net assets of VMAC represents a service for listing, and is accounted for as a share-based payment which is expensed as incurred. The net assets of the Combined Company will be stated at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the exchange of VMAC s shares for Anghami Inc. s shares will be deemed to be those of Anghami Inc.
+
+ Basis of Pro Forma Presentation
+
+ The adjustments presented in the unaudited pro forma combined financial information have been identified and presented to provide an understanding of the Combined Company upon consummation of the Transactions for illustrative purposes.
+
+ The following unaudited pro forma combined financial information has been prepared in accordance with Article 11 of Regulation S-X as amended by the final rule, Release No. 33-10786 Amendments to Financial Disclosures about Acquired and Disposed Businesses. Release No. 33-10786 replaces the existing pro forma adjustment criteria with simplified requirements to depict the accounting for the transaction ( Transaction Accounting Adjustments ) and present the reasonably estimable synergies and other transaction effects that have occurred or are reasonably expected to occur ( Management s Adjustments ). Anghami has elected not to present Management s Adjustments and will only be presenting Transaction Accounting Adjustments in the following unaudited pro forma combined financial information.
+
+ 
+
+ 49
+
+ Table of Contents
+
+ 
+ The unaudited pro forma combined financial information is for illustrative purposes only. The financial results may have been different had the companies always been combined. The unaudited pro forma combined financial information should not be relied upon as being indicative of the historical results that would have been achieved had the companies always been combined or the future results that the Combined Company will experience. Anghami and VMAC have not had any historical relationship prior to the Transactions. Accordingly, no pro forma adjustments were required to eliminate activities between the companies.
+
+ The historical financial information of VMAC has been adjusted to give effect to the differences between U.S. GAAP and IFRS for the purposes of the unaudited pro forma combined financial information. No adjustments were required to convert VMAC financial statements from U.S. GAAP to IFRS except to reclassify VMAC change in fair value of warrants liability to finance income/cost to align with IFRS presentation. This did not impact net loss.
+
+ The unaudited pro forma combined financial information has been prepared assuming the actual redemption scenario using the actual number of VMAC Class A Common Stock that have been redeemed.
+
+ Included in the shares outstanding and weighted average shares outstanding as presented in the unaudited pro forma combined financial information are an aggregate of 18,000,000 ordinary shares issued to Anghami s shareholders. Pursuant to the Business Combination Agreement, Anghami Shareholders were entitled to receive cash consideration only if the available cash exceeded $50,000,000. No cash consideration was paid to Anghami s shareholders because the available cash did not exceed $50,000,000.
+
+ The following table summarizes the pro forma number of ordinary shares outstanding after the closing of the Transaction, by source (without giving effect to (i) Public Warrants that will remain outstanding immediately following the Transactions and may be exercised thereafter or (ii) any options that will be outstanding upon completion of the Transactions under the Pubco incentive plan, but including the VMAC Class B Common Stock, which at the Closing was converted into 2,500,000 ordinary shares):
+
+ 
+
+ 
+ 
+
+ December 31, 2021
+
+ 
+ 
+ 
+ Number of Shares(1)
+
+ 
+ 
+ 
+ % of 
+Shares
+
+ 
+ 
+
+ 
+ 
+ VMAC s Public Stockholders(2)
+
+ 
+ 
+ 
+ 242,967
+
+ 
+ 
+ 
+ 0.94
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ VMAC s Initial Stockholders
+
+ 
+ 
+ 
+ 2,830,000
+
+ 
+ 
+ 
+ 10.98
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ PIPE investors(3)
+
+ 
+ 
+ 
+ 4,056,000
+
+ 
+ 
+ 
+ 15.74
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ Anghami Shareholders(4)
+
+ 
+ 
+ 
+ 18,000,000
+
+ 
+ 
+ 
+ 69.85
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ Share based payments(5)
+
+ 
+ 
+ 
+ 640,000
+
+ 
+ 
+ 
+ 2.48
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ Total
+
+ 
+ 
+ 
+ 25,768,967
+
+ 
+ 
+ 
+ 100.0
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ ____________
+(1) Excludes (a) ordinary shares issuable upon the exercise of 11,447,800 warrants to be outstanding upon completion of the Transactions and (b) ordinary shares issuable pursuant to the Pubco incentive plan.
+
+ (2) Reflects shares remaining after actual redemptions.
+
+ (3) Includes 4,056,000 ordinary shares held by VMAC PIPE investors.
+
+ (4) Based on estimated price of $10.00 per share.
+
+ (5) Relates to transaction costs settled in shares issued.
+
+ All numbers given below are in US dollars except as indicated otherwise. Certain amounts that appear in this section may not sum due to rounding.
+
+ 
+
+ 50
+
+ Table of Contents
+
+ 
+ Unaudited Pro Forma Combined Statement of Financial Position as of December 31, 2021
+(in U.S. dollars)
+
+ 
+
+ 
+ 
+
+ Unaudited Pro Forma Combined Statement of Financial Position As of December 31, 2021
+
+ 
+ 
+ 
+ Historical
+Anghami
+
+ 
+ 
+ 
+ Historical
+VMAC
+
+ 
+ 
+ 
+ Notes
+
+ 
+ 
+ 
+ Pro forma
+adjustments
+
+ 
+ 
+ 
+ Pro forma
+Combined
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+
+ 
+ 
+ Assets
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Non-Current
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Property and equipment
+
+ 
+ 
+ 
+ 276,325
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 276,325
+
+ 
+ 
+
+ 
+ 
+ Intangible assets
+
+ 
+ 
+ 
+ 2,042,846
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2,042,846
+
+ 
+ 
+
+ 
+ 
+ Right-of-use assets
+
+ 
+ 
+ 
+ 169,769
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 169,769
+
+ 
+ 
+
+ 
+ 
+ Investment in a joint venture
+
+ 
+ 
+ 
+ 48,142
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 48,142
+
+ 
+ 
+
+ 
+ 
+ Cash held in Trust Account
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 102,075,348
+
+ 
+ 
+ 
+ (A)
+
+ 
+ 
+ 
+ (102,075,348
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Non-current Assets
+
+ 
+ 
+ 
+ 2,537,082
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 102,075,348
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2,537,082
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Current
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Trade and other receivables
+
+ 
+ 
+ 
+ 5,405,547
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 5,405,547
+
+ 
+ 
+
+ 
+ 
+ Government grants
+
+ 
+ 
+ 
+ 601,612
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 601,612
+
+ 
+ 
+
+ 
+ 
+ Amount due from related parties
+
+ 
+ 
+ 
+ 1,666,909
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1,666,909
+
+ 
+ 
+
+ 
+ 
+ Contract assets
+
+ 
+ 
+ 
+ 2,164,205
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2,164,205
+
+ 
+ 
+
+ 
+ 
+ Cash and bank balances
+
+ 
+ 
+ 
+ 649,972
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 27,150
+
+ 
+ 
+ 
+ (A)
+
+ 
+ 
+ 
+ 102,075,348
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 22,264,947
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ (B)
+
+ 
+ 
+ 
+ 40,560,000
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ (C)
+
+ 
+ 
+ 
+ (10,600,000
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ (D)
+
+ 
+ 
+ 
+ (150,750
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ (G)
+
+ 
+ 
+ 
+ (99,595,254
+
+ 
+ 
+ ) 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (I)
+
+ 
+ 
+ 
+ (10,701,519
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Current Assets
+
+ 
+ 
+ 
+ 10,488,245
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 27,150
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 32,103,220
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Total Assets
+
+ 
+ 
+ 
+ 13,025,327
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 102,102,498
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 34,640,302
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Liabilities
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Non-Current
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Provision for employees end-of-service
+benefits
+
+ 
+ 
+ 
+ 166,013
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 166,013
+
+ 
+ 
+
+ 
+ 
+ Derivative warrant liabilities
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 7,523,620
+
+ 
+ 
+ 
+ (K)
+
+ 
+ 
+ 
+ 102,376
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 7,625,996
+
+ 
+ 
+
+ 
+ 
+ Lease liabilities
+
+ 
+ 
+ 
+ 135,967
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 135,967
+
+ 
+ 
+
+ 
+ 
+ Government grants
+
+ 
+ 
+ 
+ 310,163
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 310,163
+
+ 
+ 
+
+ 
+ 
+ Deferred tax liabilities
+
+ 
+ 
+ 
+ 14,625
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 14,625
+
+ 
+ 
+
+ 
+ 
+ Non-current Liabilities
+
+ 
+ 
+ 
+ 626,768
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 7,523,620
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 8,252,764
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Current
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Trade and other payables
+
+ 
+ 
+ 
+ 15,892,129
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 150,750
+
+ 
+ 
+ 
+ (D)
+
+ 
+ 
+ 
+ (150,750
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 15,892,129
+
+ 
+ 
+
+ 
+ 
+ Government grants
+
+ 
+ 
+ 
+ 81,606
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 81,606
+
+ 
+ 
+
+ 
+ 
+ Contract liabilities
+
+ 
+ 
+ 
+ 3,150,431
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 3,150,431
+
+ 
+ 
+
+ 
+ 
+ Loans and Borrowings
+
+ 
+ 
+ 
+ 18,526,802
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (C)
+
+ 
+ 
+ 
+ (18,526,802
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Amount due to related parties
+
+ 
+ 
+ 
+ 2,070,847
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2,224,960
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 4,295,807
+
+ 
+ 
+
+ 
+ 
+ Income tax payables
+
+ 
+ 
+ 
+ 518,500
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 518,500
+
+ 
+ 
+
+ 
+ 
+ Bank overdrafts
+
+ 
+ 
+ 
+ 17,432
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 17,432
+
+ 
+ 
+
+ 
+ 
+ Lease liabilities
+
+ 
+ 
+ 
+ 104,233
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 104,233
+
+ 
+ 
+
+ 
+ 
+ Current Liabilities
+
+ 
+ 
+ 
+ 40,361,980
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2,375,710
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 24,060,138
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Total Liabilities
+
+ 
+ 
+ 
+ 40,988,748
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 9,899,330
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 32,312,902
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Commitments and Contingencies
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Common stock subject to possible
+redemption
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 100,000,000
+
+ 
+ 
+ 
+ (G)
+
+ 
+ 
+ 
+ (100,000,000
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Shareholders Equity
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Anghami
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Share capital
+
+ 
+ 
+ 
+ 8,540
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (C)
+
+ 
+ 
+ 
+ 400
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ (8,940
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Share premium
+
+ 
+ 
+ 
+ 32,102,426
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (C)
+
+ 
+ 
+ 
+ 7,926,402
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ (40,028,828
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ Share-based payment reserves
+
+ 
+ 
+ 
+ 3,162,544
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ (3,162,544
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Other reserves
+
+ 
+ 
+ 
+ (100,774
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ 100,774
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Accumulated losses
+
+ 
+ 
+ 
+ (62,015,211
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ 62,015,211
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Non-controlling interest
+
+ 
+ 
+ 
+ (1,120,946
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ 1,120,946
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+
+ 51
+
+ Table of Contents
+
+ 
+ Unaudited Pro Forma Combined Statement of Financial Position as of December 31, 2021
+(in U.S. dollars) (Continued)
+
+ 
+
+ 
+ 
+
+ Unaudited Pro Forma Combined Statement of Financial Position As of December 31, 2021
+
+ 
+ 
+ 
+ Historical Anghami
+
+ 
+ 
+ 
+ Historical VMAC
+
+ 
+ 
+ 
+ Notes
+
+ 
+ 
+ 
+ Pro forma adjustments
+
+ 
+ 
+ 
+ Pro forma Combined
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+
+ 
+ 
+ VMAC
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Class A share capital
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 33
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ (33
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Class B share capital
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 250
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (F)
+
+ 
+ 
+ 
+ (250
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Accumulated deficit
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (7,797,115
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ 7,797,115
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Pubco
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Ordinary share capital
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (B)
+
+ 
+ 
+ 
+ 406
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2,577
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ 1,800
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ 33
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (G)
+
+ 
+ 
+ 
+ 24
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (F)
+
+ 
+ 
+ 
+ 250
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (J)
+
+ 
+ 
+ 
+ 64
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Share premium reserve
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (B)
+
+ 
+ 
+ 
+ 40,559,594
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 106,093,121
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ 8,940
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ 40,028,828
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ 35,894,996
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (G)
+
+ 
+ 
+ 
+ 404,722
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (I)
+
+ 
+ 
+ 
+ (10,701,519
+
+ 
+ 
+ ) 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (J)
+
+ 
+ 
+ 
+ (64
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (K)
+
+ 
+ 
+ 
+ (102,376
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Share-based payment reserves
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ 3,162,544
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 3,162,544
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Other reserves
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ (100,774
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (100,774
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Accumulated losses
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ (62,015,211
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (105,709,122
+
+ 
+ 
+ ) 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ (35,896,796
+
+ 
+ 
+ ) 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ (7,797,115
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Non-controlling interest
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ (1,120,946
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (1,120,946
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Total shareholders equity
+
+ 
+ 
+ 
+ (27,963,421
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (7,796,832
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2,327,400
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Total Liabilities and Shareholders Equity
+
+ 
+ 
+ 
+ 13,025,327
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 102,102,498
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 34,640,302
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+
+ 52
+
+ Table of Contents
+
+ 
+ Unaudited Pro Forma Combined Statement of Comprehensive Income for the year ended
+December 31, 2021 (in U.S. dollars, except share data)
+
+ 
+
+ 
+ 
+
+ Unaudited Pro Forma Combined Statement of Comprehensive Income For the year ended December 31, 2021
+
+ 
+ 
+ 
+ Historical Anghami
+
+ 
+ 
+ 
+ Historical VMAC
+
+ 
+ 
+ 
+ Notes
+
+ 
+ 
+ 
+ IFRS conversion and presentation alignment
+
+ 
+ 
+ 
+ Notes
+
+ 
+ 
+ 
+ Pro forma adjustments
+
+ 
+ 
+ 
+ Pro forma Combined
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+
+ 
+ 
+ Revenue from contracts with
+customers
+
+ 
+ 
+ 
+ 35,504,392
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 35,504,392
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Cost of revenue
+
+ 
+ 
+ 
+ (26,462,637
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (26,462,637
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Gross Profit
+
+ 
+ 
+ 
+ 9,041,755
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 9,041,755
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Selling and marketing
+expenses
+
+ 
+ 
+ 
+ (8,013,933
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (8,013,933
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ General and administrative
+expenses
+
+ 
+ 
+ 
+ (11,017,765
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (903,439
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (E)
+
+ 
+ 
+ 
+ (35,896,796
+
+ 
+ 
+ ) 
+
+ 
+ 
+ 
+ (47,818,000
+
+ 
+ 
+ ) 
+
+ 
+ 
+
+ 
+ 
+ Consultancy and professional fees
+
+ 
+ 
+ 
+ (6,120,494
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (6,120,494
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Government grants
+
+ 
+ 
+ 
+ 2,546,360
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2,546,360
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Operating Loss
+
+ 
+ 
+ 
+ (13,564,077
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (903,439
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (50,364,312
+
+ 
+ 
+ ) 
+
+ 
+ 
+
+ 
+ 
+ Finance costs
+
+ 
+ 
+ 
+ (2,679,763
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (2,679,763
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Finance income
+
+ 
+ 
+ 
+ 145,107
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 25,746
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (1)
+
+ 
+ 
+ 
+ 2,754,830
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (H)
+
+ 
+ 
+ 
+ (25,746
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 2,899,937
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Other income
+
+ 
+ 
+ 
+ 41,419
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 41,419
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Share of loss of a joint venture
+
+ 
+ 
+ 
+ (94,210
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (94,210)
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Foreign exchange loss, net
+
+ 
+ 
+ 
+ (1,558,780
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (1,558,780
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Change in fair value of warrant liabilities
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2,754,830
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (1)
+
+ 
+ 
+ 
+ (2,754,830
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ (Loss)/income before tax
+
+ 
+ 
+ 
+ (17,710,304
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 1,877,137
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (51,755,709
+
+ 
+ 
+ ) 
+
+ 
+ 
+
+ 
+ 
+ Income tax expense
+
+ 
+ 
+ 
+ (340,003
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (340,003
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Total comprehensive (loss)/income for the period
+
+ 
+ 
+ 
+ (18,050,307
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 1,877,137
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (52,095,712
+
+ 
+ 
+ ) 
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Attributable to:
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Equity holders of the parent
+
+ 
+ 
+ 
+ (17,786,681
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 1,877,137
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ (35,922,542
+
+ 
+ 
+ ) 
+
+ 
+ 
+ 
+ (51,832,086
+
+ 
+ 
+ ) 
+
+ 
+ 
+
+ 
+ 
+ Non-controlling interests
+
+ 
+ 
+ 
+ (263,626
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (263,626
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Total comprehensive (loss)/income for the period
+
+ 
+ 
+ 
+ (18,050,307
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 1,877,137
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (52,095,712
+
+ 
+ 
+ ) 
+
+ 
+ 
+
+ 
+ 
+ Weighted average share outstanding basic and diluted
+
+ 
+ 
+ 
+ 85,966
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2,830,000
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 25,768,967
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Basic and diluted net income/(loss)
+per share
+
+ 
+ 
+ 
+ (206.90
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ 0.66
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (2.01
+
+ 
+ 
+ ) 
+
+ 
+ 
+
+ 
+ 
+
+ 53
+
+ Table of Contents
+
+ 
+ IFRS Adjustments and Reclassifications
+
+ The historical financial information of VMAC for the year ended December 31, 2021 were prepared in accordance with U.S. GAAP, and have been adjusted to give effect to the differences between U.S. GAAP and IFRS.
+
+ The IFRS adjustments and reclassifications included in the unaudited pro forma combined statement of comprehensive income for the year ended December 31, 2021 are as follows:
+
+ (1) Reflects the reclassification adjustments to align VMAC historical financial statements balances with the presentation of Anghami s historical financial statements. This reclassification has no impact on net income.
+
+ Transaction Accounting Adjustments to unaudited pro forma combined financial information
+
+ (A) Reflects the reclassification of $102,075,348 of cash and marketable securities held in the Trust Account that becomes available to fund the Transactions.
+
+ (B) Reflects the proceeds received from the PIPE with the corresponding issuance of 4,056,000 ordinary shares, with a nominal value of $0.0001 per share, assuming stock price of $10.00 per share. The unaudited pro forma combined statement of financial position reflects this payment as an increase of cash and bank balances of $40,560,000 with a corresponding increase to ordinary share capital of $406 and increase to share premium reserve of $40,559,594.
+
+ (C) Represents the settlement of Anghami s loans and borrowings through cash payment of $10,600,000 and conversion of the remaining convertible notes into ordinary shares in Anghami by the issuance of 4,003 shares reflected as an increase in $400 share capital and $7,926,402 share premium.
+
+ (D) Reflects the payment of $150,750 deferred fees, which results in a decrease in Cash and bank balances with a corresponding decrease in trade and other payables.
+
+ (E) To reflect the recapitalization of Anghami through:
+
+ (i) The contribution of all the aggregate share capital, share premium, share-based payment reserves, other reserves, accumulated losses and non-controlling interest (post considering the conversion of Anghami s convertible notes into ordinary shares) in Anghami to Anghami Inc. of $8,940, $40,028,828, $3,162,544, $(100,774), $(62,015,211), and $(1,120,946).
+
+ (ii) The issuance of 18,000,000 ordinary shares to Anghami Shareholders is recorded as an increase in Pubco ordinary share capital of $1,800, and an increase in Pubco share premium reserve of $35,894,996.
+
+ (iii) The elimination of the historical VMAC Class A share capital of $33 and accumulated losses of $7,797,115.
+
+ (iv) The fair value of the share consideration and the excess of the fair value of the shares issued over the value of the net monetary assets acquired in the Transactions, where the fair value of share consideration of $71,289,670 and a $35,896,796 excess over the value of the net monetary assets acquired.
+
+ Under IFRS 2, this excess amount is recognized as a loss on the unaudited pro forma combined statement of comprehensive income.
+
+ (F) Reflects the net adjustment in respect of VMAC Class B Common Stock in relation to the reorganization between VMAC and Anghami Inc. and the Transactions. Upon completion of the reorganization between VMAC and Anghami Inc., all VMAC Class B Common Stock will be surrendered in exchange for the same number of ordinary shares. The unaudited pro forma combined statement of financial position reflects these adjustments as a reduction to VMAC Class B share capital of $250 with a corresponding increase to ordinary share capital of $250.
+
+ 
+
+ 54
+
+ Table of Contents
+
+ 
+ (G) Reflects the actual redemption of 9,757,033 VMAC Class A Common Stock for aggregate redemption payments of $99,595,254. The unaudited pro forma combined statement of financial position reflects this payment as a reduction to cash and bank balances of $99,595,254 with a corresponding decrease in Common stock subject to possible redemption of $100,000,000, an increase in ordinary share capital of $24, and an increase in share premium reserve of $404,722.
+
+ (H) Reflects the elimination of interest income related to the marketable securities held in the Trust Account.
+
+ (I) Represents transaction costs incurred by Anghami and VMAC of $10,701,519, inclusive of advisory, banking, printing, legal, and accounting fees that are incurred as a part of the Business Combination and equity issuance costs that are specifically incremental costs directly attributable to the Business Combination that are capitalized into Share premium. The unaudited pro forma condensed combined statement of financial position reflects these costs as a reduction of cash and bank balances of $10,701,519 with a corresponding offset of $10,701,519 to additional share premium reserve.
+
+ (J) Represents transaction costs incurred by Anghami and VMAC of $6,400,000 settled through the issuance of shares. This transaction cost relates to advisory and banking fees that are incurred as a part of the Business Combination and equity issuance costs that are specifically incremental costs directly attributable to the Business Combination that are capitalized into Share premium. The unaudited pro forma condensed combined statement of financial position reflects these costs as an increase to ordinary share capital of $64 with a corresponding net offset of $64 to additional share premium reserve.
+
+ (K) Represents transaction costs incurred by Anghami and VMAC of $102,376 settled through the issuance of warrants. This transaction cost relates to advisory and banking fees that are incurred as part of the Business Combination and equity issuance costs that are specifically incremental costs directly attributable to the Business Combination that are capitalized into Share premium. The unaudited pro forma condensed combined statement of financial position reflects this cost as an increase to derivative warrant liabilities of $102,376 with a corresponding offset of $102,376 to additional share premium reserve.
+
+ 
+
+ 55
+
+ Table of Contents
+
+ 
+ UNAUDITED PRO FORMA COMPARATIVE PER SHARE DATA
+
+ The following table sets forth: 
+
+ (i) the historical comparative share information of VMAC for the year ended December 31, 2021 on a stand-alone basis; (ii) the historical comparative share information of Anghami for the year ended December 31, 2021 on a stand-alone basis; and (iii) pro forma combined per share information after giving effect to the transaction, 
+
+ The comparative per share data has been prepared assuming the actual redemption scenario using the actual number of VMAC Class A Common Stock that have been redeemed.
+
+ The weighted average shares outstanding and net earnings per share information reflect the transactions as if they had occurred on January 1, 2021.
+
+ This information is only a summary and should be read together with VMAC s audited financial statements and related notes thereto, Anghami s audited consolidated financial statements and the related notes thereto included elsewhere in this prospectus. The unaudited pro forma combined per share data of VMAC and Anghami is derived from, and should be read in conjunction with, the section entitled Unaudited Pro Forma Combined Financial Information and related notes thereto included elsewhere in this prospectus.
+
+ The unaudited pro forma combined net loss per share information below does not purport to represent the net loss per share which would have occurred had the companies been combined during the periods presented, nor earnings per share for any future date or period.
+
+ The following table is also based on the assumption that there are no adjustments for the outstanding public and private placement warrants as such securities are not exercisable until the later of: (i) 30 days after the completion of VMAC s initial business combination, and (ii) 12 months from the closing of VMAC s IPO (which period has now passed). The warrants expire five years after completion of VMAC s initial business combination.
+
+ All numbers given below are in US dollars except as indicated otherwise. Certain amounts that appear in this section may not sum due to rounding.
+
+ 
+
+ 
+ 
+
+ Unaudited Pro Forma Comparative Per Share Data for 
+the year ended December 31, 2021
+
+ 
+ 
+ 
+ Historical VMAC
+
+ 
+ 
+ 
+ Historical Anghami
+
+ 
+ 
+ 
+ Actual Redemptions
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+
+ 
+ 
+ Net income/(loss) attributable to equity holders of the parent
+
+ 
+ 
+ 
+ 1,877,137
+
+ 
+ 
+ 
+ (17,786,681
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (51,832,086
+
+ 
+ 
+ ) 
+
+ 
+ 
+
+ 
+ 
+ Weighted average shares outstanding basic and diluted
+
+ 
+ 
+ 
+ 2,830,000
+
+ 
+ 
+ 
+ 85,966
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 25,768,967
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Basic and diluted net income/(loss) per share
+
+ 
+ 
+ 
+ 0.66
+
+ 
+ 
+ 
+ (206.90
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (2.01
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+
+ 56
+
+ Table of Contents
+
+ 
+ MATERIAL CAYMAN ISLANDS INCOME TAX CONSIDERATIONS
+
+ The following is a discussion on certain Cayman Islands income tax consequences of an investment in our securities. The discussion is a general summary of present law, which is subject to prospective and retroactive change. It is not intended as tax advice, does not consider any investor s particular circumstances, and does not consider tax consequences other than those arising under Cayman Islands law.
+
+ Under Existing Cayman Islands Laws:
+
+ Payments of dividends and capital in respect of our securities will not be subject to taxation in the Cayman Islands and no withholding will be required on the payment of a dividend or capital to any holder of the securities nor will gains derived from the disposal of the securities be subject to Cayman Islands income or corporate tax. The Cayman Islands currently has no income, corporate or capital gains tax and no estate duty, inheritance tax or gift tax.
+
+ No stamp duty is payable in respect of the issue of the warrants. An instrument of transfer in respect of a warrant is stampable if executed in or brought into the Cayman Islands.
+
+ No stamp duty is payable in respect of the issue of our ordinary shares or on an instrument of transfer in respect of such shares. However, an instrument of transfer in respect of shares is stampable if executed in or brought into the Cayman Islands.
+
+ The Tax Concessions Act
+
+ (As Revised)
+
+ Undertaking as to Tax Concessions
+
+ We are incorporated under the laws of the Cayman Islands as an exempted company with limited liability and, as such, has applied for and received an undertaking from the Financial Secretary of the Cayman Islands in the following form:
+
+ In accordance with the provision of Section 6 of The Tax Concessions Act (As Revised), the Financial Secretary undertakes with Anghami Inc. (the Company ):
+
+ 1. That no law which is hereafter enacted in the Islands imposing any tax to be levied on profits, income, gains or appreciations shall apply to the Company or our operations; and
+
+ 2. In addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax shall be payable:
+
+ 2.1 On or in respect of the shares, debentures or other obligations of the Company; or
+
+ 2.2 by way of the withholding in whole or part, of any relevant payment as defined in Section 6(3) of the Tax Concessions Act (As Revised).
+
+ These concessions shall be for a period of 20 years from the March 1, 2021.
+
+ 
+
+ 57
+
+ Table of Contents
+
+ 
+ MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS
+
+ This section describes the material U.S. federal income tax considerations for beneficial owners of our ordinary shares and warrants. This discussion applies only to ordinary shares and warrants held as capital assets for U.S. federal income tax purposes (generally, property held for investment) and does not discuss all aspects of U.S. federal income taxation that might be relevant to holders in light of their particular circumstances or status, including alternative minimum tax and Medicare contribution tax consequences, or holders who are subject to special rules, including:
+
+ brokers, dealers and other investors that do not own ordinary shares or warrants as capital assets;
+
+ traders in securities that elect to use a mark-to-market method of accounting for their securities holdings;
+
+ tax-exempt organizations, qualified retirement plans, individual retirement accounts or other tax deferred accounts;
+
+ banks or other financial institutions, underwriters, insurance companies, real estate investment trusts or regulated investment companies;
+
+ U.S. expatriates or former long-term residents of the United States;
+
+ persons that own (directly, indirectly, or by attribution) 5% or more (by vote or value) of our ordinary shares;
+
+ partnerships or other pass-through entities for U.S. federal income tax purposes, or beneficial owners of partnerships or other pass-through entities;
+
+ persons holding our ordinary shares or warrants as part of a straddle, hedging or conversion transaction, constructive sale, or other arrangement involving more than one position;
+
+ persons required to accelerate the recognition of any item of gross income with respect to our ordinary shares or warrants as a result of such income being recognized on an applicable financial statement;
+
+ persons whose functional currency is not the U.S. dollar;
+
+ persons that received our ordinary shares or warrants as compensation for services; or
+
+ controlled foreign corporations or passive foreign investment companies.
+
+ This discussion is based on the Internal Revenue Code of 1986, as amended (the Code ), existing and proposed Treasury regulations promulgated under the Code (the Treasury Regulations ), published rulings by the IRS and court decisions, all as of the date hereof. These laws are subject to change, possibly on a retroactive basis. This discussion is necessarily general and does not address all aspects of U.S. federal income taxation, including the effect of the U.S. federal alternative minimum tax, or U.S. federal estate and gift tax, or any state, local or non-U.S. tax laws to a holder of our ordinary shares or warrants.
+
+ ALL HOLDERS OF OUR ORDINARY SHARES OR WARRANTS SHOULD CONSULT WITH THEIR OWN TAX ADVISORS REGARDING THE TAX CONSEQUENCES TO THEM OF THE OWNERSHIP AND DISPOSITION OF ORDINARY SHARES AND WARRANTS, INCLUDING THE EFFECTS OF U.S. FEDERAL, STATE, AND LOCAL AND NON-U.S. TAX LAWS.
+
+ U.S. Federal Income Tax Treatment of Anghami 
+
+ A corporation is generally considered for U.S. federal income tax purposes to be a tax resident in the jurisdiction of its organization or incorporation. Accordingly, under the generally applicable U.S. federal income tax rules, we, since we are incorporated under the Cayman Islands, would be classified as a non-U.S. corporation (and, therefore, not a U.S. tax resident) for U.S. federal income tax purposes. Section 7874 of the Code provides an exception to this general rule (more fully discussed below), under which a non-U.S. incorporated entity may, in certain circumstances, be treated as a U.S. corporation for U.S. federal income tax purposes. These rules are complex and there is limited guidance regarding their application.
+
+ 
+
+ 58
+
+ Table of Contents
+
+ 
+ Under Section 7874, a corporation created or organized outside the United States (i.e., a non-U.S. corporation) will nevertheless be treated as a U.S. corporation for U.S. federal income tax purposes (and, therefore, as a U.S. tax resident subject to U.S. federal income tax on its worldwide income) if each of the following three conditions are met: (i) the non-U.S. corporation, directly or indirectly, acquires substantially all of the properties held directly or indirectly by a U.S. corporation (including through the acquisition of all of the outstanding shares of the U.S. corporation); (ii) the non-U.S. corporation s expanded affiliated group does not have substantial business activities in the non-U.S. corporation s country of organization or incorporation and tax residence relative to the expanded affiliated group s worldwide activities (this test is referred to as the substantial business activities test ); and (iii) after the acquisition, the former shareholders of the acquired U.S. corporation hold at least 80% (by either vote or value) of the shares of the non-U.S. acquiring corporation by reason of holding shares in the U.S. acquired corporation (taking into account the receipt of the non-U.S. corporation s shares in exchange for the U.S. corporation s shares) as determined for purposes of Section 7874 (this test is referred to as the 80% ownership test ).
+
+ For purposes of Section 7874, the first two conditions described above were met with respect to the Business Combination because we acquired indirectly all of the assets of VMAC in the Business Combination, and we, including our expanded affiliated group, is not expected to satisfy the substantial business activities test. As a result, whether Section 7874 will apply to cause us to be treated as a U.S. corporation for U.S. federal income tax purposes should depend on the satisfaction of the 80% ownership test.
+
+ Based upon the terms of the Business Combination, the rules for determining share ownership under Section 7874 and the Treasury Regulations promulgated thereunder, and certain factual assumptions, we believe that the ownership percentage of the VMAC stockholders in us is less than 80%. Accordingly, we do not believe that we are treated as a U.S. corporation for U.S. federal income tax purposes under Section 7874. The rules for determining ownership under Section 7874 are complex, unclear and the subject of ongoing regulatory change. Accordingly, there can be no assurance that the IRS would not assert a contrary position to those described above or that such an assertion would not be sustained by a court.
+
+ If we were to be treated as a U.S. corporation for U.S. federal income tax purposes, it could be subject to substantial liability for additional U.S. income taxes, and the gross amount of any dividend payments to our non-U.S. holders (as defined below) could be subject to 30% U.S. withholding tax, depending on the application of any income tax treaty that might apply to reduce the withholding tax.
+
+ The remainder of this discussion assumes that we are not treated as a U.S. corporation for U.S. federal income tax purposes under Section 7874.
+
+ U.S. Holders
+
+ The section applies to you if you are a U.S. holder. For purposes of this discussion, a U.S. holder means a beneficial owner of our ordinary shares or warrants that is, for U.S. federal income tax purposes:
+
+ an individual who is a citizen or resident of the United States;
+
+ a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia;
+
+ an estate whose income is subject to U.S. federal income tax regardless of its source; or
+
+ a trust if (1) a U.S. court can exercise primary supervision over the trust s administration and one or more U.S. persons are authorized to control all substantial decisions of the trust; or (2) the trust has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person.
+
+ Distributions on Ordinary Shares
+
+ Subject to the discussion under the section entitled Material U.S. Federal Income Tax Considerations U.S. Holders Passive Foreign Investment Company Rules, the gross amount of any distribution on our ordinary shares that is made out of our current or accumulated earnings and profits (as determined for U.S. federal income tax purposes) generally will be taxable to a U.S. holder as ordinary dividend income on the date such distribution is actually or constructively received. Any such dividends generally will not be eligible for the dividends received 
+
+ 
+
+ 59
+
+ Table of Contents
+
+ 
+ deduction allowed to corporations in respect of dividends received from other U.S. corporations. To the extent that the amount of the distribution exceeds our current and accumulated earnings and profits (as determined under U.S. federal income tax principles), such excess amount will be treated first as a non-taxable return of capital to the extent of the U.S. holder s tax basis in its ordinary shares, and thereafter as capital gain recognized on a sale or exchange.
+
+ Subject to the discussion under the section entitled Material U.S. Federal Income Tax Considerations U.S. Holders Passive Foreign Investment Company Rules, dividends received by non-corporate U.S. holders (including individuals) from a qualified foreign corporation may be eligible for reduced rates of taxation, provided that certain holding period requirements and other conditions are satisfied. For these purposes, a non-U.S. corporation will be treated as a qualified foreign corporation with respect to dividends it pays on shares that are readily tradable on an established securities market in the United States. U.S. Treasury guidance indicates that shares listed on Nasdaq will be considered readily tradable on an established securities market in the United States. Subject to the exception discussed below for passive foreign investment companies, since our ordinary shares are currently traded on the Nasdaq we believe that we should be treated as a qualified foreign corporation for purposes of dividends paid on those shares. However, there can be no assurance that ordinary shares will be considered readily tradable on an established securities market in future years. Non-corporate U.S. holders that do not meet a minimum holding period requirement during which they are not protected from the risk of loss or that elect to treat the dividend income as investment income pursuant to Section 163(d)(4) of the Code (dealing with the deduction for investment interest expense) will not be eligible for the reduced rates of taxation regardless of our status as a qualified foreign corporation. In addition, the rate reduction will not apply to dividends if the recipient of a dividend is obligated to make related payments with respect to the positions in substantially similar or related property. This disallowance applies even if the minimum holding period has been met. We will not constitute a qualified foreign corporation for purposes of these rules if we are a passive foreign investment company for the taxable year in which it pays a dividend or for the preceding taxable year. See the section entitled Material U.S. Federal Income Tax Considerations U.S. Holders Passive Foreign Investment Company Rules. 
+
+ Sale, Exchange, Redemption or Other Taxable Disposition of Ordinary Shares and Warrants
+
+ Subject to the discussion under the section entitled Material U.S. Federal Income Tax Considerations U.S. Holders Passive Foreign Investment Company Rules, a U.S. holder generally will recognize gain or loss on any sale, exchange, redemption or other taxable disposition of our ordinary shares or warrants in an amount equal to the difference between (i) the amount realized on the disposition and (ii) such U.S. holder s adjusted tax basis in such ordinary shares or warrants. Any gain or loss recognized by a U.S. holder on a taxable disposition of our ordinary shares or warrants generally will be capital gain or loss and will be long-term capital gain or loss if the holder s holding period in such shares and/or warrants exceeds one year at the time of the disposition. Preferential tax rates may apply to long-term capital gains of non-corporate U.S. holders (including individuals). The deductibility of capital losses is subject to limitations. Any gain or loss recognized by a U.S. holder on the sale or exchange of our ordinary shares or warrants generally will be treated as U.S. source gain or loss.
+
+ Exercise or Lapse of a Warrant
+
+ Except as discussed below with respect to the cashless exercise of a warrant, a U.S. holder generally will not recognize gain or loss upon the acquisition of an ordinary share on the exercise of a warrant for cash. A U.S. holder s tax basis in an ordinary shares received upon exercise of the warrant generally should be an amount equal to the sum of the U.S. holder s tax basis in the warrant exchanged therefor and the exercise price. The U.S. holder s holding period for an ordinary share received upon exercise of the warrant will begin on the date following the date of exercise (or possibly the date of exercise) of the warrant and will not include the period during which the U.S. holder held the warrant. If a warrant is allowed to lapse unexercised, a U.S. holder generally will recognize a capital loss equal to such holder s tax basis in the warrant.
+
+ The tax consequences of a cashless exercise of a warrant are not clear under current tax law. A cashless exercise may be tax-deferred, either because the exercise is not a gain realization event or because the exercise is treated as a recapitalization for U.S. federal income tax purposes. In either tax-deferred situation, a U.S. holder s basis in the ordinary shares received would equal the holder s basis in the warrants exercised therefore. If the cashless exercise were treated as not being a gain realization event, a U.S. holder s holding period in the ordinary shares would be treated as commencing on the date following the date of exercise (or possibly the date of exercise) of the warrants. If the cashless exercise were treated as a recapitalization, the holding period of the ordinary shares would include the holding period of the warrants exercised therefore.
+
+ 
+
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+ 
+ It is also possible that a cashless exercise of a warrant could be treated in part as a taxable exchange in which gain or loss would be recognized. In such event, a U.S. holder would recognize gain or loss with respect to the portion of the exercised warrants treated as surrendered to pay the exercise price of the warrants (the surrendered warrants ). The U.S. holder would recognize capital gain or loss with respect to the surrendered warrants in an amount generally equal to the difference between (i) the fair market value of the ordinary shares that would have been received with respect to the surrendered warrants in a regular exercise of the warrants and (ii) the sum of the U.S. holder s tax basis in the surrendered warrants and the aggregate cash exercise price of such warrants (if they had been exercised in a regular exercise). In this case, a U.S. holder s tax basis in the ordinary shares received would equal the U.S. holder s tax basis in the warrants exercised plus (or minus) the gain (or loss) recognized with respect to the surrendered warrants. A U.S. holder s holding period for the ordinary shares would commence on the date following the date of exercise (or possibly the date of exercise) of the warrants.
+
+ Due to the absence of authority on the U.S. federal income tax treatment of a cashless exercise of warrants, there can be no assurance which, if any, of the alternative tax consequences and holding periods described above would be adopted by the IRS or a court of law. Accordingly, U.S. holders should consult their own tax advisors regarding the tax consequences of a cashless exercise of warrants.
+
+ Possible Constructive Distributions
+
+ The terms of each warrant provide for an adjustment to the number of ordinary shares for which the warrant may be exercised or to the exercise price of the warrant in certain events, as discussed in the section entitled Description of Securities. An adjustment which has the effect of preventing dilution generally is not taxable. A U.S. holder of a warrant would, however, be treated as receiving a constructive distribution from us if, for example, the adjustment increases the holder s proportionate interest in our assets or earnings and profits (e.g., through an increase in the number of ordinary shares that would be obtained upon exercise of such warrant) as a result of a distribution of cash to the holders of the ordinary shares which is taxable to the U.S. holders of such shares as described under the section entitled Material U.S. Federal Income Tax Considerations U.S. Holders Distributions on Ordinary Shares. Such constructive distribution would be subject to tax as described under that section in the same manner as if the U.S. holder of such warrant received a cash distribution from us equal to the fair market value of such increased interest. The rules regarding constructive distributions are complex. U.S. holders should consult their own tax advisors regarding the application of the rules to them in light of their own circumstances.
+
+ Passive Foreign Investment Company Rules
+
+ Generally. The treatment of U.S. holders of our ordinary shares could be materially different from that described above if we are treated as a passive foreign investment company, or PFIC, for U.S. federal income tax purposes. A PFIC is any foreign corporation with respect to which either: (i) 75% or more of the gross income for a taxable year constitutes passive income for purposes of the PFIC rules, or (ii) 50% or more of such foreign corporation s assets in any taxable year (generally based on the quarterly average of the value of its assets during such year) is attributable to assets, including cash, that produce passive income or are held for the production of passive income. Passive income generally includes dividends, interest, certain royalties and rents, annuities, net gains from the sale or exchange of property producing such income and net foreign currency gains. The determination of whether a foreign corporation is a PFIC is based upon the composition of such foreign corporation s income and assets (including, among others, its proportionate share of the income and assets of any other corporation in which it owns, directly or indirectly, 25% (by value) of the stock), and the nature of such foreign corporation s activities. A separate determination must be made after the close of each taxable year as to whether a foreign corporation was a PFIC for that year. Once a foreign corporation qualifies as a PFIC it is, with respect to a shareholder during the time it qualifies as a PFIC, and subject to certain exceptions, always treated as a PFIC with respect to such shareholder, regardless of whether it satisfied either of the qualification tests in subsequent years.
+
+ If we are or become a PFIC during any year in which a U.S. holder holds ordinary shares, there are three separate taxation regimes that could apply to such U.S. holder under the PFIC rules, which are the (i) excess distribution regime (which is the default regime), (ii) QEF regime, and (iii) mark-to-market regime. A U.S. holder who holds (actually or constructively) stock in a foreign corporation during any year in which such corporation qualifies as a PFIC is subject to U.S. federal income taxation under one of these three regimes. The effect of the PFIC rules on a U.S. holder will depend upon which of these regimes applies to such U.S. holder. However, dividends paid by a PFIC are generally not eligible for the lower rates of taxation applicable to qualified dividend income ( QDI ) under any of the foregoing regimes.
+
+ 
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+ 
+ Excess Distribution Regime. If a U.S. holder does not make a QEF election or a mark-to-market election, as described below, the U.S. holder will be subject to the default excess distribution regime under the PFIC rules with respect to (i) any gain realized on a sale or other disposition (including a pledge) of our ordinary shares, and (ii) any excess distribution received on our ordinary shares (generally, any distributions in excess of 125% of the average of the annual distributions on ordinary shares during the preceding three years or the U.S. holder s holding period, whichever is shorter). Generally, under this excess distribution regime:
+
+ the gain or excess distribution will be allocated ratably over the period during which the U.S. holder held ordinary shares;
+
+ the amount allocated to the current taxable year, will be treated as ordinary income; and
+
+ the amount allocated to prior taxable years will be subject to the highest tax rate in effect for that taxable year and the interest charge generally applicable to underpayments of tax will be imposed on the resulting tax attributable to each such year.
+
+ The tax liability for amounts allocated to years prior to the year of disposition or excess distribution will be payable generally without regard to offsets from deductions, losses and expenses. In addition, gains (but not losses) realized on the sale of ordinary shares cannot be treated as capital gains, even if you hold the shares as capital assets. Further, no portion of any distribution will be treated as QDI.
+
+ QEF Regime. A QEF election is effective for the taxable year for which the election is made and all subsequent taxable years and may not be revoked without the consent of the IRS. If a U.S. holder makes a timely QEF election with respect to its direct or indirect interest in a PFIC, the U.S. holder will be required to include in income each year a portion of the ordinary earnings and net capital gains of the PFIC as QEF income inclusions, even if amount is not distributed to the U.S. holder. Thus, the U.S. holder may be required to report taxable income as a result of QEF income inclusions without corresponding receipts of cash. Our shareholders that are U.S. holders subject to U.S. federal income tax should expect that they will not receive cash distributions from us sufficient to cover their respective U.S. tax liability with respect to such QEF income inclusions. In addition, U.S. holders of warrants will not be able to make a QEF election with respect to their warrants.
+
+ The timely QEF election also allows the electing U.S. holder to: (i) generally treat any gain recognized on the disposition of its shares of the PFIC as capital gain; (ii) treat its share of the PFIC s net capital gain, if any, as long-term capital gain instead of ordinary income; and (iii) either avoid interest charges resulting from PFIC status altogether, or make an annual election, subject to certain limitations, to defer payment of current taxes on its share of PFIC s annual realized net capital gain and ordinary earnings subject, however, to an interest charge on the deferred tax computed by using the statutory rate of interest applicable to an extension of time for payment of tax. In addition, net losses (if any) of a PFIC will not pass through to our shareholders and may not be carried back or forward in computing such PFIC s ordinary earnings and net capital gain in other taxable years. Consequently, a U.S. holder may over time be taxed on amounts that as an economic matter exceed our net profits.
+
+ A U.S. holder s tax basis in our ordinary shares will be increased to reflect QEF income inclusions and will be decreased to reflect distributions of amounts previously included in income as QEF income inclusions. No portion of the QEF income inclusions attributable to ordinary income will be treated as QDI. Amounts included as QEF income inclusions with respect to direct and indirect investments generally will not be taxed again when distributed. U.S. holders should consult their own tax advisors as to the manner in which QEF income inclusions affect their allocable share of our income and their basis in our ordinary shares.
+
+ In order to comply with the requirements of a QEF election, a U.S. holder must receive certain information from us. If we determine that we are a PFIC for any taxable year, we will endeavor to provide all of the information that a U.S. holder making a QEF election is required to obtain to make and maintain a QEF election, but there is no assurance that we will timely provide such information. There is also no assurance that we will have timely knowledge of our status as a PFIC in the future or of the required information to be provided. In addition, if we hold an interest in a lower-tier PFIC (including, without limitation, in any PFIC subsidiaries), U.S. holders will generally be subject to the PFIC rules described above with respect to any such lower-tier PFICs. 
+
+ Mark-to-Market Regime. Alternatively, a U.S. holder may make an election to mark marketable shares in a PFIC to market on an annual basis. PFIC shares generally are marketable if: (i) they are regularly traded on a national securities exchange that is registered with the Securities and Exchange Commission or on the national market system established under Section 11A of the Securities Exchange Act of 1934; or (ii) they are regularly traded 
+
+ 
+
+ 62
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+ 
+ on any exchange or market that the Treasury Department determines to have rules sufficient to ensure that the market price accurately represents the fair market value of the stock. We believe that our ordinary shares qualify as marketable shares for the PFIC rules purposes, but there can be no assurance that ordinary shares will continue to be regularly traded for purposes of these rules. Pursuant to such an election, a U.S. holder would include in each year as ordinary income the excess, if any, of the fair market value of our ordinary shares over the U.S. holder s adjusted tax basis at the end of the taxable year. A U.S. holder may treat as ordinary loss any excess of the adjusted basis of the stock over its fair market value at the end of the year, but only to the extent of the net amount previously included in income as a result of the election in prior years. A U.S. holder s adjusted tax basis in the our ordinary shares will be increased to reflect any amounts included in income, and decreased to reflect any amounts deducted, as a result of a mark-to-market election. Any gain recognized on a disposition of ordinary shares will be treated as ordinary income and any loss will be treated as ordinary loss (but only to the extent of the net amount of income previously included as a result of a mark-to-market election). A mark-to-market election only applies for the taxable year in which the election was made, and for each subsequent taxable year, unless the PFIC shares ceased to be marketable or the IRS consents to the revocation of the election. U.S. holders should also be aware that the Code and the Treasury Regulations do not allow a mark-to-market election with respect to stock of lower-tier PFICs that is non-marketable. There is also no provision in the Code, Treasury Regulations or other published authority that specifically provides that a mark-to-market election with respect to the stock of a publicly-traded holding company (such as us) effectively exempts stock of any lower-tier PFICs from the negative tax consequences arising from the general PFIC rules. U.S. holders should consult their own tax advisors to determine whether the mark-to-market tax election is available to them and the consequences resulting from such election. In addition, U.S. holders of warrants will not be able to make a mark-to-market election with respect to their warrants.
+
+ PFIC Reporting Requirements. If we are a PFIC, a U.S. holder of our ordinary shares will be required to file an annual report on IRS Form 8621 containing such information with respect to our ordinary shares as the IRS may require. Failure to file IRS Form 8621 for each applicable taxable year may result in substantial penalties and result in the U.S. holder s taxable years being open to audit by the IRS until such Forms are properly filed.
+
+ Additional Reporting Requirements
+
+ Certain U.S. holders holding specified foreign financial assets with an aggregate value in excess of the applicable dollar thresholds are required to report information to the IRS relating to our ordinary shares, subject to certain exceptions (including an exception for ordinary shares held in accounts maintained by U.S. financial institutions), by attaching a complete IRS Form 8938 to their tax return, for each year in which they hold our ordinary shares. Substantial penalties apply to any failure to file IRS Form 8938, unless the failure is shown to be due to reasonable cause and not willful neglect. Also, in the event a U.S. holder does not file IRS Form 8938 or fails to report a specified foreign financial asset that is required to be reported, the statute of limitations on the assessment and collection of U.S. federal income taxes of such U.S. holder for the related taxable year may not close before the date which is three years after the date on which the required information is filed. U.S. holders should consult their tax advisors regarding the effect, if any, of these rules on the ownership and disposition of our ordinary shares.
+
+ Non-U.S. Holders
+
+ The section applies to non-U.S. holders. For purposes of this discussion, a non-U.S. holder means a beneficial owner (other than a partnership or an entity or arrangement so characterized for U.S. federal income tax purposes) of our ordinary shares or warrants that is not a U.S. holder.
+
+ Assuming that we are not treated as a U.S. corporation under the rules discussed above, a non-U.S. holder of our ordinary shares will not be subject to U.S. federal income tax or, subject to the discussion below under Information Reporting and Backup Withholding, U.S. federal withholding tax on any dividends received on ordinary shares or any gain recognized on a sale or other disposition of ordinary shares (including, any distribution to the extent it exceeds the adjusted basis in the non-U.S. holder s ordinary shares) unless the dividend or gain is effectively connected with the non-U.S. holder s conduct of a trade or business in the United States, and if required by an applicable tax treaty, is attributable to a permanent establishment maintained by the non-U.S. holder in the United States. In addition, special rules may apply to a non-U.S. holder that is an individual present in the United States for 183 days or more during the taxable year of the sale or disposition, and certain other requirements are met. Such non-U.S. holders should consult their own tax advisors regarding the U.S. federal income tax consequences of the sale or disposition of ordinary shares.
+
+ 
+
+ 63
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+ 
+ Dividends and gains that are effectively connected with a non-U.S. holder s conduct of a trade or business in the United States (and, if required by an applicable income tax treaty, are attributable to a permanent establishment in the United States) generally will be subject to U.S. federal income tax at the same regular U.S. federal income tax rates applicable to a comparable U.S. holder and, in the case of a non-U.S. holder that is a corporation for U.S. federal income tax purposes, also may be subject to an additional branch profits tax at a 30% rate or a lower applicable tax treaty rate.
+
+ The U.S. federal income tax treatment of a non-U.S. holder s exercise of a warrant, or the lapse of a warrant held by a non-U.S. holder, generally will correspond to the U.S. federal income tax treatment of the exercise or lapse of a warrant by a U.S. holder, as described under U.S. Holders Exercise or Lapse of a warrant, above, although to the extent a cashless exercise results in a taxable exchange, the consequences would be similar to those described in the preceding paragraphs above for a non-U.S. holder s gain on the sale or other disposition of the ordinary shares and warrants.
+
+ Information Reporting and Backup Withholding
+
+ Information reporting requirements may apply to dividends received by U.S. holders of ordinary shares, and the proceeds received on the disposition of ordinary shares effected within the United States (and, in certain cases, outside the United States), in each case other than U.S. holders that are exempt recipients (such as corporations). Backup withholding (currently at a rate of 24%) may apply to such amounts if the U.S. holder fails to provide an accurate taxpayer identification number (generally on an IRS Form W-9 provided to the paying agent of the U.S. holder s broker) or is otherwise subject to backup withholding. Any dividend payments with respect to our ordinary shares and proceeds from the sale, exchange, redemption or other disposition of our ordinary shares may be subject to information reporting to the IRS and possible U.S. backup withholding. U.S. holders should consult their own tax advisors regarding the application of the U.S. information reporting and backup withholding rules.
+
+ Information returns may be filed with the IRS in connection with, and non-U.S. holders may be subject to backup withholding on amounts received in respect of their ordinary shares, unless the non-U.S. holder furnishes to the applicable withholding agent the required certification as to its non-U.S. status, such as by providing a valid IRS Form W-8BEN, IRS Form W-8BEN-E or IRS Form W-8ECI, as applicable, or the non-U.S. holder otherwise establishes an exemption. Dividends paid with respect to ordinary shares and proceeds from the sale of other disposition of ordinary shares received in the United States by a non-U.S. holder through certain U.S.-related financial intermediaries may be subject to information reporting and backup withholding unless such non-U.S. holder provides proof an applicable exemption or complies with certain certification procedures described above, and otherwise complies with the applicable requirements of the backup withholding rules.
+
+ Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against the holder s U.S. federal income tax liability, and a holder may obtain a refund of any excess amounts withheld under the backup withholding rules by timely filing the appropriate claim for a refund with the IRS and furnishing any required information.
+
+ 
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+ 
+ BUSINESS
+
+ In this section, references to Anghami, we, us and our are intended to refer to Anghami Inc. and its subsidiaries, unless the context clearly indicates otherwise.
+
+ Overview
+
+ Founded in 2012, Anghami was the first music-streaming platform in the Middle East and North Africa (the MENA Region ). Anghami s business focuses on the following countries within the MENA Region: Algeria, Bahrain, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Morocco, Oman, Palestine, Qatar, Saudi Arabia, Sudan, Tunisia and UAE (together, our MENA Operating Area ). We are now the leading regional digital music entertainment technology platform in our MENA Operating Area, with the largest catalog, offering approximately 60 million songs to more than 100 million registered users as of December 31, 2021, 1.4 million paid subscribers and 18.3 million active users, with more than 9.2 billion streams per year as of December 2021. We are a music application and platform that offers listeners in the MENA Operating Area Arabic and international music to stream and download.
+
+ The service is offered through a choice of two primary plans: Free (Ad-supported) and Anghami Plus (Premium service). Within the Premium service, we offer four main subscription plans: our individual Anghami Plus plan, the Family Anghami Plus Plan (1 plan for 6 individual accounts at a discounted price), the Student Plan (discounted and restricted to students), the limited Anghami Plus plan (a more restricted Plus plan currently available through selected partners or in certain territories). These plans differ in both pricing and duration ranging from daily to yearly offers. The pricing plans differ by country and currencies.
+
+ We have licensing agreements with thousands of independent labels and distributors to provide users with access to a vast catalog of music. We have long standing business relationships with major global labels including Universal Music Group, Sony Music and Warner Music Group. We have a physical presence in UAE, Saudi Arabia, Egypt and Lebanon, in the MENA Region to establish and maintain strong partnerships with labels, artists, brands, and telecommunication companies. In addition, we have established strategic relationships with 45 telecommunication companies across the MENA Operating Area, which we believe will help us to boost free user acquisitions and facilitate subscriptions in our effort to maintain a leading paying conversion rate amongst music streaming services in the MENA Operating Area.
+
+ Our artificial intelligence and machine learning algorithms process over 56 million data points collected from our users every day. We utilize over nine years of historical user data to understand user trends, predict user behavior, and invest in growth areas that we believe are likely to generate the highest return on investment. Anghami expects its use of data collection and historical user data to help improve monetization and continue to be a key driver of revenues.
+
+ We are headquartered in Abu Dhabi, at the ADGM, and have offices in Beirut, Dubai, Cairo and Riyadh. The ADIO, being the Abu Dhabi government s investment attraction and development hub, has committed to providing approximately up to AED 60 million (which as of September 13, 2021 would have been approximately $16.5 million) in financial incentives to support the establishment, growth and development of our technology and research and development center in Abu Dhabi, subject to us meeting certain performance metrics and conditions.
+
+ Corporate History and Structure
+
+ Anghami Inc. is a Cayman Islands exempted company incorporated in March 2021. Our direct and indirect key subsidiaries include:
+
+ Anghami, Cayman Islands exempted company incorporated in February 2012;
+
+ DigiMusic S.A.L. (Off-Shore), a Lebanese entity established in November 2011;
+
+ Anghami FZ LLC, a limited liability company, registered in the UAE, Dubai, established in May 2014;
+
+ Anghami for Digital Content, a joint-stock company, registered in Egypt, established in March 2017 ( ADC );
+
+ Anghami KSA Co., a limited liability company, registered in the Kingdom of Saudi Arabia, established in May 2018;
+
+ Anghami UK LTD, a limited liability company, registered in England, established in December 2019; and
+
+ 
+
+ 65
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+ 
+ Anghami Technologies Ltd, a limited liability company, registered in the UAE, Abu Dhabi, established in December 2020.
+
+ Anghami (DE) Inc., (formerly Vistas Media Acquisition Company Inc.) was incorporated in Delaware on March 27, 2020.
+
+ Before the year ended 31 December 2020 the shares of Anghami KSA and Anghami for Digital Content ( ADC ) were held by employees as nominees on behalf of the Company. The Company had a binding and irrevocable undertakings with each nominee that enabled the Company to:
+
+ (1) control and direct all of Anghami KSA and ADC activities and enables our senior management and board of directors to make all operational and financial decisions and obliges the appointed nominees to strictly follow our directions and decisions;
+
+ (2) exercise its power over all operating and financial decisions to receive all the rights, returns and obligations generated from Anghami KSA and ADC; and
+
+ (3) control the ownership and transfer of the shares relating to Anghami KSA and ADC.
+
+ In March 2021, Anghami KSA s ownership was legally transferred to Anghami FZ LLC, and in August 2021 ADC s legally was fully transferred to Anghami FZ LLC.
+
+ In February 2022, we completed the Business Combination. Prior to the closing of the Business Combination Anghami Inc, was a wholly owned subsidiary of Anghami. The following diagram illustrates our current organizational structure after the closing of the Business Combination:
+
+ 
+
+ Anghami Inc. is subject to certain of the informational filing requirements of the Securities Exchange Act of 1934, as amended (the Exchange Act ). Because Anghami Inc. is a foreign private issuer , we are exempt from the rules and regulations under the Exchange Act prescribing the furnishing and content of proxy statements, and the officers, directors and principal shareholders of Anghami Inc. are exempt from the reporting and short-swing profit 
+
+ 
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+ recovery provisions contained in Section 16 of the Exchange Act with respect to their purchase and sale of common shares. In addition, Anghami Inc. is not required to file reports and financial statements with the SEC as frequently or as promptly as U.S. public companies whose securities are registered under the Exchange Act. However, the Company is required to file with the SEC an Annual Report on Form 20-F containing financial statements audited by an independent accounting firm. The SEC also maintains a website at www.sec.gov that contains reports and other information that Anghami Inc. files with or furnishes electronically to the SEC.
+
+ The website address of Anghami Inc. is www.anghami.com/investors. The information contained on the website does not form a part of, and is not incorporated by reference into, this annual report.
+
+ Industry Overview
+
+ Global Music Recording Industry
+
+ The global music recording industry has been making a strong comeback after a period of decline in the early 2000s and is steadily achieving positive growth due in large part to the advent of music streaming. According to the International Federation of the Phonographic Industry ( IFPI ), recorded music revenue returned to growth in 2015 after the global industry s lowest revenue in 2014 of $14 billion. After nearly two decades of piracy-driven declines, in 2015 global recorded music revenues grew more than 3.57% from the prior year, and global recorded music revenue growth accelerated in 2016 reaching $15.8 billion, an increase of 8.97% from 2015. Since that time the industry has rebounded to $21.6 billion in revenue in 2020 and further grew by 18.5% in 2021 to reach $25.9 billion. The industry, bolstered by music streaming, has now experienced seven years of positive growth.
+
+ Streaming Behind Music Industry Return to Growth
+
+ The return to growth of the global recording industry was primarily driven by streaming, as its growth replaced the decline in physical music sales. According to the IFPI, streaming revenue grew by 24.3% in 2021 to reach $16.9 billion or 65.0% of global recorded revenue, with subscription revenue accounting for $12.3 billion and growing by 21.9%. There were 523 million paying subscribers in 2021, up from 443 million in 2020 and 341 million in 2019.
+
+ Streaming is growing globally, including in emerging markets. The ease of access to the internet, exponentially increasing internet penetration, and high smartphone adoption were drivers for this growth and turned streaming into the dominant global format in the music industry. The COVID-19 pandemic has only increased the impact and importance of music streaming, as digital delivery platforms allowed continued use during the pandemic despite government shutdowns and social distancing behaviors.
+
+ We believe that the music streaming market still has potential for significant growth and is still in its early stage. Adoption and penetration rates have plenty of room to increase both in established and growing markets. In 2021, the IFPI recorded 523 million users of paid subscription accounts in the industry generally, which is far fewer than the 5.3 billion unique mobile phone users. Further, aggregate streaming revenues in the United States, which is the largest market for the recorded music industry, grew 23% in 2021 to $15 billion, and constituted 83% of the total US music industry revenues in that year.
+
+ Music Streaming Industry in the Middle East and North Africa Region
+
+ Decreasing popularity of physical CDs and album purchases is a global phenomenon and applicable to all music markets around the globe, including the MENA Region, which in recent years has shown significant growth in online music streaming adoption rates.
+
+ The MENA Region is particularly well suited to growth in the online music streaming space. According to IFPI report, MENA region achieved the highest growth in recorded music revenue across all regions with a growth rate of 35.0% in 2021, and streaming accounted for 95.3% of music consumption. In addition, according to Middle East and Africa Music Streaming Market Forecast to 2027 COVID-19 Impact and Regional Analysis By Content Type (Audio Streaming and Video Streaming), Streaming Type (Live Streaming and On-demand Streaming), and End User (Commercial and Individual) Report issued by Insight Partners in September 2020, the music streaming market in the MENA Region is expected to grow fast at a CAGR of 9.5% from $1.5 billion in 2019 to $3.2 billion by 2027.
+
+ 
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+ 
+ The total global Arab and Pakistani diaspora is substantial and is considered one of the world s fastest-growing populations. This diaspora also constitutes a favorable demographic for the music streaming space, with a large portion of this group aged between 10-35 years old.
+
+ The MENA Region also has one of the highest smartphone penetration rates in the world (especially the Gulf Cooperation Council ( GCC ) region). According to Mobile Consumption in a Post-Growth World, a Deloitte Global Mobile Consumer Survey, Middle East Edition 2019, 97% of the population overall in UAE and Saudi Arabia own a smartphone. This region also has a high internet penetration. Another study conducted by market research company Ipsos indicates a substantial embrace of music streaming in the region with 50% of music streamers listening to music online on a daily basis and around 30% using these services for at least 3-5 hours a day.
+
+ Despite international brands such as Apple, Spotify, and Deezer entering the MENA Region, we have positioned ourself as the leading streaming platform in the MENA Operating Area with first mover advantages due to being a local company and benefiting from its prior experience and history in the market. Our digital streaming offering benefits from and is differentiated by cultural fit, localized content and language, products adapted to local tastes and consumer behavior, an AI engine that caters to local tastes, and strong relationships with regional brands and telecommunications providers and a large user database. Today, we are one of the largest digital music streaming player in the MENA Operating Area. Spotify and Deezer launched in the fourth quarter of 2018 with Deezer having exclusive content with Rotana, a major Arabic label. In 2022, Anghami was able to retain Rotana content and sign an exclusive partnership with Amr Diab, the biggest Arab artist in MENA.
+
+ We have business relationships with more than 45 telecommunications providers, which we refer to as Telcos , across the MENA Operating Area, giving us a competitive edge, as we expect to have priority position with Telcos customers, access to more marketing and technical flexibility to control and optimize the subscriber s lifecycle (the process of a customer moving from Telco to a Premium service with Anghami. We leverage the Telcos strong marketing capabilities and reach to drive acquisition of new Anghami Premium subscribers using above the line marketing (during offer launches or seasonal campaigns) and ongoing below the line campaigns to promote our service, fueled by the exclusive content that we acquire and new features that we launch.
+
+ We also collaborate with leading media groups in the MENA Operating Area, mainly MBC Group, one of the largest media conglomerates in MENA. This collaboration has enhanced our visibility in the region, primarily through association of our brand with widely viewed TV shows such as The Voice and Arab Idol.
+
+ Our Strengths
+
+ Localized Content
+
+ We are the sound of the MENA Region. Arabic musical content is hyper-local. It is comprised of many subgenres, and is a relatively small percentage of the global music catalogue.
+
+ Multiplicity of Subgenres. The MENA Region has a large diversity of local musical content and music taste is often divided by sub regions within the MENA Region. For example, GCC countries have a local taste for Khaleeji content. While the Levant region s listeners focus on two distinct content categories: (1) Iraqi content and (2) the female artists popular in the broader Eastern Mediterranean. North African content falls into three major content categories: (1) Egyptian, (2) Rai (North Africa) and (3) Sudanese. Each of these interest groups comprises its own musical genre and has a large fan base across the MENA Region and among the international Arab diaspora.
+
+ Local Content with Room for Growth. The entire Arabic music catalog on Anghami includes about 700,000 songs, or around 1% of Anghami music library. The Arabic catalogue accounts for 53% of total streams on Anghami in 2021 which proves a huge potential for content creation and further growth. New, and in certain cases exclusive, Arabic content is expected to attract new users to the Anghami Premium service. In recent years the traditional Arabic content has been supplemented by younger generations who favor international remixes, Arabic hip hop and indie music with a large presence of female artists.
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+ Anghami Content Strategy
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+ We believe that the availability of unique content will drive new users and further increase in streaming adoption in the MENA Region. Accordingly, we are working to create our own original content, which we believe will help us acquire users and distinguish us from our competition.
+
+ Since its inception, Anghami collected data from more than 70 million downloads. This data collection provides Anghami with irreplaceable information regarding trends and tastes, including which artists are trending and how music genres and interests are split by demographics and country. This data provided us with test cases for and helped us in creating Anghami originals, which is a program whereby Anghami partners with local artists to create new songs and release them on our platform. From 2017 to 2021, Anghami created more than 60 original songs, with an average ROI of 59%.
+
+ We intend to continue to create content for Anghami Originals both via our relationships with local and international artists and through potential acquisitions of Arabic content from existing labels. During the first quarter of 2022, Anghami made a huge push in Arabic content creation by signing an exclusive agreement with Amr Diab, the largest Arab artist in MENA. Under this agreement, Anghami exclusively streams Amr Diab existing content and creates exclusive and original content over the next three years.
+
+ Two-Sided Marketplace
+
+ Anghami as a platform connects artists and fans bringing value in the form of a two-sided marketplace, meaning that it has the ability to provide value both to users and to artists. Users have the ability to enjoy and discover new music while remaining connected with their favorite artists. While for artists, the platform allows them both to reach and interact with fans and have access to analytics that drive a better understanding of the artist s audiences and their needs. This two-sided market approach is discussed more fully below:
+
+ Benefits for Users
+
+ We allow users to discover and play their favorite music based on algorithms for recommendations as well as human curation:
+
+ Free Ad-Supported and Paid Experience. Users have access to a free, ad-supported tier of Anghami which also provides access to a very rich high-quality content. This free offering allows users to discover the service. Our aim is that once engaged such users will opt to subscribe for a premium paid experience through different plans. These include individual monthly subscriptions, but also provide specialized offerings such as family plans, student plans and other discount plans. We also offer flexibility to pay weekly and daily especially in low ARPU markets and users can pay by various means such as billing through mobile carrier, vouchers, cash payment solutions or credit and debit card. This flexibility of plan choice, flexibility in method of payment, and flexibility in timing of payment, are all designed so that we can suit each user s individual needs. Finally, our relationship with 45 Telcos also makes it convenient for users to become paying customers who subscribe to our platform.
+
+ Playlists and Personalization. With access to more than 60 million tracks, we provide users with curated and machine-learning generated playlists that are built to suit their tastes starting from the moment they open Anghami. The more they listen and engage, the more we understand their music DNA and behavior, and the more we can provide them with content that matches their tastes, moods and preferences. We believe this tailored and personalized approach delivers higher engagement.
+
+ Multi-Platform Product Availability. We reach users wherever they are, be it on mobile, tablet, web, desktop, car, Smart TV, Smart Watch, Gaming console, etc., accessible with a single user ID. We continue to strive to provide a seamless experience that is available across all platforms.
+
+ Benefits for Artists & Creators
+
+ The Anghami platform allows artists to connect with and reach a wide audience through a variety of features, such as Live Radio, that are unique to our platform. Moreover, we provide artists with tools to access data and analytics and, most importantly, an upload tool which allows artists to publish their content directly to the platform and access reports, sales and performance data without the need for a distributor or a third party.
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+ Monetization. Since 2012, Anghami built the digital music economy in the MENA Operating Area and has been the largest music streaming platform in the MENA Operating Area in terms of payouts to artists, which neared $53 million between inception and December 31, 2021.
+
+ Exposure. We offer artists access to millions of fans through various features in-app making their work visible to their relevant audience via editorial, promoting the artist s work on the platform or on social media accounts of Anghami or the artist, and curation. We also promote artist s work through our digital media, TV partnerships such as MBC and other media outlets.
+
+ Artist Promotions via Amplify. We enable artists, creators and their managers to promote their own work on the platform via paid promotions under a program named Amplify. This program allows artists, creators, and managers to gain visibility, reach the new potential fans and grow the audiences that they feel are relevant to their popularity.
+
+ Data & Analytics. We provide numerous analytics for artists through our Anghami Artists app and dashboard interface. These offerings include demographics of that artists listening audience, geographical locations of their listeners, information about similar artists, playlist data and revenues accrued from their work.
+
+ Branded Collaboration via AnghamiStudios. Through AnghamiStudios, our production team works to provide branded content opportunities that will bring artists and brands together to create content that features brand placements. This process brings exposure, revenues and valuable brand associations to artists and brands.
+
+ Strong Local Partnerships
+
+ Anghami was the pioneer of Telco partnerships in the MENA Operating Area. Since the early days of the company, given the region s low credit card penetration and the team s extensive experience in the telecom industry, we prioritized Telco partnerships because they are a primary payment collection mechanism that users of the region trust and are familiar with.
+
+ Our relationship with Telcos has evolved over the years to become more of a strategic alliance benefiting both Anghami and the Telcos. This beneficial relationship functions as follows:
+
+ Telcos use Anghami as a tool to enhance their brand image by associating their Telco brand with an entertainment service that their customers love. This enables them to attract youth audiences, gain market share in high value segments, and drive higher data consumption. Our service helps Telcos increase their customer s retention and satisfaction as well as boosting their ARPU and their customers uptake of new packages.
+
+ Our small but effective team has a substantial experience in the industry, both technically and commercially, and is dedicated to onboarding Telcos. The team works closely with Telcos across the region to create mutually beneficial value propositions by proposing the appropriate and tailored offerings based on their strong understanding of each market. We understand the challenges and best practices of each country and each Telco specifically on the commercial, pricing, technical, marketing and legal levels. This helps us build products and services that perform better than other music streaming platforms and in a more efficient manner and that are customized to the Telco needs:
+
+ We offer Anghami Premium service as a standalone service. It is accessible through daily, weekly and monthly packages depending on the territory and is enabled using direct carrier billing or other more traditional charging methods.
+
+ Anghami Premium service is soft or hard bundled (which means that the Anghami subscription can either be automatically included in the mobile subscription or the Telco customer has the option to purchase the subscription through his Telco) with the Telco packages, which allows the customers to have access to the service part of the package free of charge for a certain period or as long as they are subscribed.
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+ We have relationships with 45 Telcos across the MENA Operating Area, which provides us an advantage of priority within the Telco process, marketing, and technical support, reducing our need to engage third parties.
+
+ Backed by our engineering team and given our experience in integrating with a vast array of Telco systems and infrastructures, we can integrate and launch services with distinct Telcos very quickly and with minimal difficulties and issues. Telco teams trust us to launch the products they need and customize them based on their requirements on tight deadlines.
+
+ Direct integration with Telcos allows us to have better control of the subscriber s lifecycle. We have implemented several mechanisms that allow us to increase subscriber retention and maximize ARPU by enabling grace periods, retrial, and auto payment mechanisms that are customized by market and product.
+
+ We leverage on the Telco s strong marketing capabilities to drive acquisition of new Anghami Premium service subscribers using: (a) above the line communication during offer launches or seasonal campaigns; and (b) ongoing below the line communication to promote the service, fueled by the exclusive content that we acquire as well as new features that are deployed.
+
+ We utilize our access to artists and major entertainment events in the region to provide our Telco partners with exclusive and attractive promotional events that lead to mobile service activations throughout the year. They use these to promote our service and allows the Telcos to associate with events and artists that create engagement with their customers. Events such as artists meet and greet, VIP concert tickets giveaways, access to private sessions with artists, and access to major regional events such as the Formula 1 in Abu Dhabi.
+
+ Our Growth Strategies
+
+ We are already the market leader in music streaming in the MENA Operating Area, but it still has ample room to grow. Our growth strategy is focused around four areas: (1) capitalizing on increasing digital music market growth in the MENA Region; (2) leveraging our current market position and knowledge to increase revenue generation and market penetration; (3) acquiring new target users and new target geographies; and (4) new revenue streams.
+
+ Capitalizing on Growth
+
+ We intend to capitalize on increasing digital music market growth in the MENA Region in three main areas: (1) growth in streaming in our core markets; (2) a strong and increasing demand for Arabic music; and (3) the ability of Arabic music to go global with popularity expanding beyond the Arab world and its diaspora.
+
+ Large Streaming Growth Potential in Core Markets. Music streaming penetration in our key markets is currently very low in comparison to other more economically developed markets. For example, only approximately 6% of the Addressable Market (defined as the part of a country s population that is 10 to 50 years old and with access to an internet connection) in Saudi Arabia has been reached, which is our largest market. Our target markets in North Africa (i.e., Tunisia, Algeria and Morocco) also have low market penetration relative to other countries. Whereas the music streaming penetration in the U.S. is approximately 35% of the addressable market. Anghami expects to benefit from this growing penetration as consumer behavior shifts from traditional methods (such as radio, digital downloads, CDs) to using music streaming. IFPI report mentioned that growth in recorded music revenue in MENA amounted to 35% with streaming market share amounting to 95.3%, which we believe puts Anghami in good position to achieve future growth potential.
+
+ Strong Demand for Arabic Music. We believe that there is room for growth and strong demand for a greater breadth of Arabic music. The entire Arabic music catalog on Anghami includes about 700,000 songs in comparison to the international music catalog that includes about 60 million songs. Given that Arabic music represents 53% of our music streams, we believe there is a compelling growth potential for Arabic content. Anghami expects to benefit from the strong latent demand for more Arabic music content created both by Anghami (through our Anghami Originals) and by other international music labels. To this extent, Anghami signed three years exclusive content with Amr Diab, the largest Arab artist in MENA. Existing Amr Diab content will be exclusively available to Anghami in addition to three albums created over the contract period.
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+ Arabic Music Going Global. We believe that the Arabic music genre is on the cusp of going global similar to what occurred with: (1) Latin music in the early 2000s (e.g., Shakira s hit album Laundry Service in 2001) and (2) Korean music (often called K-Pop) in the past 8 years (e.g., smash hit Gangnam Style released in 2012 and more recently BTS (Bangtan Boys) in 2019). The global appeal of Arabic music has also been highlighted with the global success of the movie Fast & Furious 7, the theme song of which and background music were all Arabic-inspired. In response to the global appeal of Arabic music, the two leading global music labels (Universal Music and Warner Music) have all announced in 2021 landmark initiatives to support the creation more Arabic music content:
+
+ Universal Music announced on April 6, 2021 the creation of a dedicated division for Arabic music called Universal Music MENA; and
+
+ Warner Music announced in February 2021 its investment in a leading Arabic music label.
+
+ Anghami, as the leading music streaming platform with the largest streaming distribution network in the MENA Operating Area, will benefit from this new Arabic music content in two ways. The new Arabic content will: (1) attract more users in our focus markets and also across the global diaspora of Arabs (the Arab Diaspora ) (refer to the section below entitled New Target Users and New Target Geographies ), and (2) create a new revenue stream for Anghami as Anghami strategically licenses this content globally.
+
+ In December 2021, Anghami launched a joint venture with Sony Music Entertainment called Vibe Music Arabia. The JV aims to leverage Sony s global distribution network and Anghami s artist relations to create new Arabic content tailored for younger generations and aiming for global presence. Vibe Arabia has released two new songs for a rising Arab talent and is planning to release additional 12 songs in 2022.
+
+ Leveraging Current Market Position and Knowledge.
+
+ We aim to leverage our current market position and knowledge to increase revenue generation and market penetration through: (1) maintaining and utilizing our leading local brand name, (2) our knowledge of user behavior, and (3) the growth in digital advertising in the MENA Region.
+
+ Maintain Leading Brand Name. As the first music streaming platform in the MENA Operating Area and the market leader, we believe we are synonymous in our target markets locally with music streaming. We have market-leading brand appeal among both the MENA Operating Area s music artists and music streaming users. This market-leading position provides Anghami an ability to leverage its market position and brand recognition to spur interest in both its new products and features and new Arabic music content.
+
+ Knowledge of Local User Behavior. We have a unique proprietary data set covering music streaming user s behavior in the MENA Operating Area. We have been collecting user behavior data since inception and currently collects approximately 56 million user data points per day. We have a strong data-driven music recommendation engine that gives Anghami unique insights on the type and positioning of new Arabic music in the MENA Region. Anghami already creates its own content (Anghami Originals) and believes it has proven the business case for data-driven new Arabic content creation and distribution (average ROI of 59%).
+
+ Growth in Digital Advertising. As one of the leading data-driven digital advertising platforms in the MENA Operating Area, Anghami will benefit from the accelerating shift of advertising spend from traditional advertising to digital advertising. According to an IPSOS, the total online media advertising expenditures in the MENA Region grew by 2%, from $1.27 billion in 2019 to $1.29 billion in 2020. As per latest Zawya, online media advertising expenditure grew by 22% year-on-year in the fourth quarter of 2021, in line with market trends. We believe the growth of digital advertising in the MENA Region is accelerating and we are uniquely positioned to benefit from this growth. According to eMarketer, by the end of 2025, podcasts will represent more than one-third of all digital audio services ad dollars.
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+ New Target Users and New Target Geographies
+
+ Anghami intends to target the Arab diaspora with content and products. There is a large Arab diaspora living outside the MENA Region, mostly in the Americas, Europe and Africa. This Arab diaspora is fairly affluent and educated and has maintained a strong ethnic identity and lasting links back home in the Arab world. While, in the past, we have not targeted this Arab diaspora, recently, we have developed new music streaming products and content specifically designed for the Arab diaspora.
+
+ Anghami intends to expand into large and relevant markets that are adjacent geographically or culturally to its current geographic scope. For example, Pakistan with a population of about 220 million people is a natural expansion market for Anghami. Commercial music streaming does not functionally exist in Pakistan and the music catalog is fragmented and value priced. In addition, Pakistan shares certain affinities that make it a prime market for the MENA Region, including (1) a shared religion, (2) a shared alphabet, (3) geographic proximity and (4) a large diaspora of Pakistani nationals with a higher purchasing power than Pakistani residents that reside in MENA and have done so for generations. We have developed the playbook to tackle new markets such as Pakistan, a market very similar to Egypt, one of our existing key markets.
+
+ Our Head of International Partnership is Los Angeles-based music industry entrepreneur and manager, Wassim Sal Slaiby, the CEO of XO Records, a top music label that The Weekend co-founded, and of SALXCO, his artist management firm. Sal has been instrumental in building an international user base for us and expanding our business globally. Sal will oversee our presence and launch in the U.S.
+
+ Anghami also intends to use features such as Live Radio, that offers unique experiences like participation in real-time alongside content; podcasts, which have gained significant traction with users, creators, brands, and advertisers; micro payments (which relate to social billing on the live radio or live concerts, where users can tip the broadcaster or artist, and Anghami will receive a share of that amount) and e-gifting options to attract new users to its platform.
+
+ New Revenue Streams
+
+ Anghami intends to launch new revenue streams relating to offline events. We believe that there is a big opportunity in offline events going forward. As the world and the region comes out of COVID-19 restrictions, people are willing to enjoy outdoor activities including music events. Anghami is looking to leverage on those events to (1) create a strong brand equity, (2) generate revenues, and (3) create synergies between online and offline.
+
+ Create strong brand equity. Anghami has strong relationships with regional artists. Creating music events in partnerships with those artists will enable Anghami to leverage the artist s social media presence to promote Anghami as a go to brand for music streaming and entertainment in MENA. This will ultimately result in organic user growth.
+
+ Generate revenue. Via ticket sales, events sponsorship and promotions.
+
+ Create synergies between offline and online. Live performance creates original content. By streaming the content live on Anghami, users will be spending more time on the app, thus increasing user engagement and the likelihood of converting free users to paying subscribers. In addition, Anghami plans to monetize its Live Radio feature via selling tickets for offline music events, thus increasing ARPU.
+
+ Our Business Model
+
+ We offer both paid subscriptions known as the Anghami Plus or Premium service and ad-supported free services known as the Ad-Supported service. We currently operate in 16 countries.
+
+ We offer users four main subscription plans within our Anghami Premium service: our individual Anghami Plus plan, the Family Anghami Plus Plan (1 plan for 6 individual accounts at a discounted price), the Student Plan (discounted and restricted to students), the limited Anghami Plus plan (a more restricted Plus plan currently available through selected partners or in certain territories). These plans come in monthly, 3-month, 6-month and 12-month 
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+ subscription options (both renewed and non-renewed) and can be purchased through the distribution channels listed above. The pricing plans differ by country and currencies. Additionally, and with selected partners (mainly Telco operators) and territories we offer daily and weekly subscription options.
+
+ Revenue
+
+ We have two primary revenue streams: (i) Premium subscriptions; and (ii) advertising. Revenues are primarily driven from Premium subscriptions (through app stores, our Telco partners, and direct debit and card purchases), which generated 72% of total revenues during fiscal year ended December 31, 2021 whereas data driven advertising contributed 28% of total revenues during the fiscal year ended December 31, 2021.
+
+ Over the years, we have experienced increased engagement from users, which we believe is due to the compatibility of our platform across various devices, including smartphones, desktops, cars and game consoles. Our Premium users (that is, users of Anghami Plus, our premium service) average about 72 minutes per day in 2021. Our Premium users have streamed 1.6 times the amount of content per month than non-Premium users. The latter are steadily converting into the Premium service at an average rate of 19.0% in 2021 with a healthy ratio of DAU to MAU.
+
+ Premium Service
+
+ Our Premium service provides paying subscribers with unlimited online and offline high-quality streaming and download access to our catalog, commercial-free.
+
+ Revenues through the Premium service are generated via three main payment channels: (i) through the app stores (Google Play and Apple Store), (ii) through our Telco partners, or (iii) through direct debit and card purchases. An offline channel is also available through which consumers can purchase vouchers from partner stores that provide limited access to our Premium service. So far, we have partnered with 45 Telcos distributed among 16 countries. Most of our Telco partnerships include valuable offerings to the end users such as data bundles, where customers can subscribe to our platform and receive certain amount of data to use on it. In addition, Telcos often advertise our services and plans with a significant marketing budget. We are also expanding to new online payment channels that are gaining popularity in the region such as STC Pay in Saudi Arabia and Fawry Pay in Egypt as well as integrating with mobile wallets of various banks and mobile operators that are becoming more popular as payment channels.
+
+ Premium service is the largest revenue stream and our marketing efforts focus on growing our Premium user base while investing in the product to enhance our free to premium conversion rates. Our efforts translated into consistent new subscriber growth, with the aggregate monthly subscribers (Telco and direct) increasing from 595,980 in January 2019 to 1,173,12 in December in 2021. We have also invested heavily in increasing the retention of our subscriber base by offering tailored plans and through an advanced algorithmic content recommendation engine. Over time, the churn of the monthly paying subscribers has continued to trend lower from 7.7% in January 2019 to 6.5% in December 2021.
+
+ 
+
+ The increase in churn at December 31, 2021 was due to new telco signups whose integration was still scaling up. Subsequently in February 2022, churn rate dropped to 5.6%.
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+ In order to drive the sales of our Anghami Premium service we rely on:
+
+ Converting the Anghami Free user base: Using owned and paid media channels we have built a conversion engine that relies on segmentation to target free users along their journey with the different available subscription plans directly or through partners by offering them discounts, no commitment plans and free trials. We also run big seasonal campaigns (for example: Eid offer, White Friday offer, Saudi National offer) that have longer trial periods (usually three months for new subscribers) that drive subscriptions and revenues significantly across the year; and
+
+ Acquiring Anghami Premium service subscribers (through Business to Business ( B2B ) partners): We leverage both Telco partners and distribution partners to run major seasonal above the line (ATL) campaigns and monthly below the line (BTL) campaigns that drives the acquisition of new Anghami Premium service subscribers who purchase the subscription either from the partner or get it for free (subsidized by the partner) as a part of a bundle or product sold by the partner.
+
+ In order to increase subscriber s retention and lifetime value (LTV) we have implemented several mechanisms to address churn whether involuntary, for instance, because of payment related issues such as expired credit card, or voluntary, that is the Premium user choosing to unsubscribe. Starting 2020, we increased re-subscription rate of churned users by 53% by reviewing all audiences and user journey at different stages: grace period to churn and post-churn, and adding customized messages based on the churn reason and subscription channels in different placements (in-app, email, push notifications, SMS). On the Telco level we also implemented smart charging mechanisms and extended grace periods that reduce involuntary churn and maximize the ARPU.
+
+ Anghami has also signed separate servicing agreements with 10 of the Telco operators, our B2B partners, through which Anghami sells its Premium subscription at a discount directly to the Telco operators. These Telco operators then go on to offer Anghami Premium service to their user base as part of a broader package. These agreements are based on a discounted subscription fee and tied with a minimum revenue guarantee scheme.
+
+ Our subsidiaries, Anghami FZ, LLC and Anghami KSA Co., have also entered into certain promotion agreements with Souq.com FZ-LLC and Afaq Q-Tech General Trading Co, respectively, in connection with their participation in the Amazon Prime program, which allows them to offer certain promotions, including a discounted subscription to the Anghami Plus program, to certain Amazon Prime members, subject to certain terms and conditions. Following the expiration of the twelve-month promotional period, the Amazon Prime members will be charged at standard service rates as applicable to other Premium subscribers.
+
+ Advertising Revenue
+
+ Our Ad-Supported Service has no subscription fees and provides Ad-Supported users with limited on-demand online access to our catalog on their computers and shuffle-only access on compatible mobile devices and tablets. This segment contributes to our revenues and also works as a marketing tool, increasing our user engagement who often convert to our Premium service. We generate revenue for our Ad-Supported segment from the sale of display, audio, video and content sponsorship solutions delivered through advertising impressions. We source our advertising customers through advertising agency, Digital Media Service ( DMS ), who receive a 40.5% revenue share of the gross advertising value. To date, more than 280 global brands have advertised on our platform. In 2020, we launched an additional direct ads service, whereby Anghami directly works with brands while DMS invoices and collects the receivables with a 10% revenue share. These advertising arrangements typically specify the type of advertising product, pricing, insertion dates, and number of impressions in a stated period.
+
+ Revenue for our Ad-Supported segment is affected primarily by the number of our Ad-Supported users, the total Content Hours per MAU of our Ad-Supported users, and our ability to provide innovative advertising products that are relevant to our Ad-Supported users and enhance returns for our advertising partners. Our advertising strategy centers on the belief that advertising products that are based in music and are relevant to the Ad-Supported user can enhance Ad-Supported users experiences and provide even greater returns for advertisers.
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+ In September 2021, we signed two barter agreements with Amazon Prime in Saudi and UAE whereby Anghami provides to Amazon Prime marketing services amounting $768 thousand and vice versa.
+
+ We offer different advertising campaigns on our platform, primarily in the form of:
+
+ branded content producing a song tailored to a specific brand. We have initiated this revenue stream starting 2020, and subsequently in 2021, we have seen recurring and increasing revenue from existing brands. Key customers are mainly coming from telecom, gaming and FMCG industries;
+
+ content promotion banner ads, promotion on certain playlists, audio ads, etc. We believe that this revenue stream has significant growth potential as Anghami s brand equity increases; and
+
+ sponsored playlists.
+
+ According to a study performed internally our ad formats significantly increase awareness and intent to action. The results are displayed in the table below:
+
+ 
+
+ As for our branded content solutions (sponsored playlists or branded song content) we offer brands the chance to unlock metrics focused around brand love:
+
+ 
+
+ Variable Cost Structure
+
+ Licensing Agreements
+
+ We have a rich catalog of over 60 million songs. We have signed content agreements with up to 2,000 music labels. Obtaining license agreements and paying royalties are the two prevailing costs of sales. In exchange for the right to stream certain music, royalty costs are due to music record labels and publishers. Royalties are calculated monthly based on the percentage of revenue and the music labels respective market share. In addition, Premium service user royalties depend on the number of subscribers while royalties for free users depend on the number of streams. Licensing agreements include several terms related to paying royalties, minimum guaranteed payments, marketing 
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+ commitments, reporting and audit rights. Generally, the contracts are valid for 1 year, and renegotiated on annual basis, the label holds the right to terminate the agreements if any breach of terms takes place. The content cost, which represents the royalties paid to the labels, calculated based on the number of streams/revenue generated for each category separately (Premium revenue and Ad-Supported revenue), constitutes a major part of our variable costs and amounts to 36% of our revenue.
+
+ We have long standing relationships with both global and local music companies despite a fragmented market. Among these are the top three global music labels: Universal Music Group, Sony Music Entertainment, and Warner Music Group; alongside the largest regional labels: Rotana, Qanawat, Watary, Platinum record and Nay. Arabic label agreements provide for global coverage while most of the international music agreements are restricted to the MENA Operating Area. We have also signed an exclusive three year agreement with Amr Diab, the biggest artist in the Arab World whereby Anghami becomes the sole distributor of Amr Diab content globally, for the next three years. In addition, Amr Diab will create exclusive content for Anghami over the contract term.
+
+ Payment Fees/Expenses
+
+ The various payment channels we use are entitled to a portion of our revenue. The emerging markets are characterized by very low credit and debit cards penetration, which is why we have focused on diversifying our payment channels to increase our user base. Partnerships with the Telco operators acted as a key catalyst to help us achieve and maintain a leading paying conversion rate amongst music streaming services in the MENA Operating Area.
+
+ The take rate varies depending on the payment channel as follows:
+
+ Direct carrier billing: 59.2% of our total subscription revenues in 2021 were paid via direct carrier billing. The Telco operator s share is subject to a revenue share agreement that varies by operator and by country. On average, Telcos charge a 30% transaction fee.
+
+ App stores: 36.5% of our total subscription revenues in 2021 were paid via app stores and are subject to revenue share agreements with the relevant app store. Apple Store and Google Play charge 30% of the transaction value. Apple stores reduces the take rate to 15% of the transaction value in the second year of the retained user s subscription, while Google store reduced the take rate to all subscribers to 15% as of June 7, 2021.
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+ Vouchers: To cater to users who are not used to transacting online, we sell vouchers via an offline distribution network such as Epay, Cash United, Virgin Megastores, LikeCard, Fawry, BOB, Libanpost, Whish/Itel, Librairie Antoine, CashPlus, YouGotAGift (YGAG), Wafa Cash, Akwad, Al Khdmah Pro, STC Pay, Resal KSA. 1.0% of our total subscription revenues in 2021 were paid via vouchers. Distribution partners charge up to 10% fee of the voucher value. In addition, vouchers are often combined with an advertising campaign and sold to our advertising brands, who then distribute it to its customers.
+
+ Debit and credit cards: There is generally a fixed transaction fee per transaction plus a variable rate that varies according to the country and currency. 3.34% of our subscription revenues in 2021 were paid via debit and credit cards, average fees amount to 5.4%.
+
+ B2B Telco contracts described above are not subject to a revenue share agreement.
+
+ Variable Technology costs
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+ We partnered with Amazon Web Services ( AWS ) to host our servers and to provide scalability, redundancy, security and ensure continuity of our operations. In addition, we partnered with other third-party technology providers to optimize our services and the music listening experience. On an average, monthly variable technology costs in 2021 amounted to $266,400. These costs vary month-to-month based on usage and app features (video vs. audio streaming, etc.).
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+ Our Services
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+ Unique User Experience
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+ We combine a sleek and seamless user interface with our artificial intelligence and machine learning capabilities to create a sophisticated yet user-friendly platform accessible on every kind of device. We provide a customized on-boarding process to ensure that from the moment users open the Anghami application, they see a personalized homepage with content that reflects our understanding of their music tastes. Users are able to explore our deep library of content with a variety of features including personalized mixtapes, song recommendations and playlists with top charts by country and genre. We provide effortless search capabilities using the universal search bar, Radar and Personal DJ features.
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+ We also give our users different ways to search, browse, engage, and discover music and other content. These include:
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+ Mixtapes: We have built a machine learning model that learns from users streaming habits and generates weekly and daily personalized mixtapes that fit their music taste. They are part of our effort to increase music discoverability, personalize the user s experience by ensuring that we provide them with a variety of content inspired by the music they like.
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+ Personalized recommendations: Our AI-powered recommendation system fuels different parts of the platform. Our explore page is shaped around personalized playlists, albums, and songs that match the users expectations. Those recommendations rely on their music DNA, time of day, day of week, and other factors, to surface the content that the users are most likely to enjoy and therefore increase time spent on the application. Whenever users interact with any song, album, or artist, we utilize our recommendation system to generate a list of similar content that is also personalized to make sure they enjoy a pleasant music experience.
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+ Playlists: We provide users with the ability to create their own playlists to organize their library and access their favorite songs easily. They can also discover playlists that are made by other users or by our own curation team. Our team has built over 4,000 playlists so users can browse among more than a 100 genres and moods and find a variety of playlists that fit their different moods and tastes.
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+ Search Functions: To allow proper discoverability of our entire library, we give users the ability to search for all types of content. Users can find songs, albums, artists, playlists, podcasts, moods, genres, and even other users on Anghami. They can also search for songs using parts of their lyrics. Our search engine is integrated with various virtual assistants like Siri and Google assistant to make it even easier to search and find content using audio commands.
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+ Videos: We also have invested in expanding our content offerings to include videos. Embedding video clips into activity-based playlists helps provide a visual layer to our content offerings, allowing artists to promote their music further through graphics or photos on social media platforms while the song is playing. Integrating video into our playlists enables us to convert our listeners into content viewers.
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+ Podcasts: We offer a growing number of podcasts, which have gained significant traction with users, creators, brands, and advertisers. Our platform enables seamless dissemination of podcasts covering a wide range of genres and topics, including technology, sports, business and finance, travel, and cooking, among many others. According to a report by eMarketer, global podcast listeners are expected to reach 504 million in 2024 up from 275 million in 2019 representing a CAGR of 12.9%. This engagement presents a significant opportunity for Anghami as we believe we have the ability to enhance the podcast user experience with a better product that is focused on discovery, especially since we are working on original podcasts and have developed a curated podcast section for the MENA Operating Area users.
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+ Radar: Discovery of new music is a big part of any user s experience on Anghami. With a single tap, a user can trigger Radar, a recognition feature which would identify the music playing around them, display the song with all its details then add it to a special playlist for easy access. This allows users to discover new songs they hear on TV, radio, or at public places and add them to their library. Our Radar ensures offline experiences are complimented by a smooth online experience on the platform.
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+ Immersive User Engagement
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+ In addition to our large catalogue of music, we offer unique opportunities to our users to engage with the Anghami community through features that create an immersive social experience such as chats, stories, Anghami Live and music rooms.
+
+ Chats: To increase user-to-user interaction and extend the time spent in-app, we allow users to share music with their friends directly on Anghami instead of having to use a third party chat application. This simplifies the users experience and encourages them to interact with others around music. Users can exchange songs and text messages via Chats and instantly create a shared mixtape that matches both their tastes.
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+ Stories: Stories allow users to share the music they play with their followers in a unique way. All stories are displayed at the top of the explore page. Users can choose to share songs manually or automatically so they can be posted as chapters in their stories. Stories are 15 seconds previews of songs that users can browse in a seamless manner and react to them using Emoji s and text replies. They allow users to discover new music through their friends and interact with others around music.
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+ Live Radio: Live Radio offers a number of unique features. Any user, including artists, DJs, content creators and music influencers, will be able to talk alongside playing songs, playlists and podcasts from our large library of music. It gives everyone the chance to participate in a real-time version of a podcast experience and, by creating their own virtual events, users will be able to bring together communities with live interaction. Other features include applauding the host, sending text comments, meeting other participants and side-chats.
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+ Music Match: As part of the social music experience, Anghami allows users to find people that have a similar music taste. A music match is a score that shows on any user suggestions component and on a user s profile page. We surface a special section of users that have a high music match on the explore page. This increases engagement between users and helps them build new friendships.
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+ Advertising Solutions
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+ We offer the following advertising solutions:
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+ Media Offerings:
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+ Audio Ads: Audio ads, our core offering, are 15-second ad slots that sit in between songs, and cannot be skipped. They are accompanied by a companion banner with a call to action that can link to a landing page. It creates a one-on-one environment between the brand and the user. We have also recently released a unique audio to leads solution. This allows brands to collect Anghami first party data via a lead form that the ad leads to. This lead form can be customized with a message from the brand, to make the user want to submit their leads.
+
+ Video Ads: Anghami allows brands to communicate their video copies, either 15-seconds or 30-seconds of length. These also appear in between the users listening experience.
+
+ Display Ads: Display, which is one of the most common media formats in the market, is available on Anghami across multiple formats. These are best used to drive traffic to a landing page. One of the reasons we offer video and display, apart from being common and known formats, is because our research has shown that combining video and display with audio drives further impact across brand funnel metrics.
+
+ Programmatic Integration: Our media solutions are available programmatically, through what are typically referred to as demand side platform ( DSP s). Programmatic is used by clients to buy in real-time and have more cross campaign visibility. We can guarantee audio on programmatic at a fixed price, however our display solutions are available to be bought in real-time by a programmatic DSP.
+
+ We have designed a new pricing scheme for ads that depends on the number of streams delivered to users rather than number of impressions. Besides, we introduced additional formats for ads delivery in which users listen to shorter ads over shorter intervals. We believe that these changes will increase ads inventory and ultimately increase our yield from advertising revenue.
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+ Content Promotion Offerings and Production
+
+ We offer brands the ability to promote their own music content to achieve more streams. We typically do this by making the content more discoverable on the platform and easily searchable. We also provide brands the ability to sponsor a playlist. Sponsoring a playlist gives the brand 100% share of voice on that playlist, with a logo on the cover of the playlist and a display masthead within the playlist. A brand can also create their own playlist which we can in turn promote on the platform, while also leveraging the platform s AI to recommend customized playlists to users, with a branded message.
+
+ We also offer both audio and music production capabilities to advertisers. Branded content is a significant part of our advertising unit, as brands have become more accustomed to creating content to communicate their message, and build favorability. Anghami produces music in various forms for brands and manages the entire process. Most notably, Anghami produces songs that brands end up owning and can promote on Anghami, as well as across other media channels. Furthermore, Anghami also creates music videos to support the songs, the majority of which are shot in studios. We have also started creating experiences in the form of concerts. These can be pre-recorded and post-edited, or live. With the latter, Anghami allows brands to host the concert live via their new live feature, where people can stream live and engage with the brand, as well as with each other.
+
+ Data Solutions
+
+ To measure the effectiveness of our ad campaigns, we run research to note the awareness, favorability and recall brands have on the platform. In certain instances, we run searches on the platform to note the current level of awareness a brand may have. We send these research documents to brands post-campaign and measure against the initial awareness they had. We have also automated and decentralized certain tools to give clients the ability to cherry pick insights and create audience profiling on the platforms as well as traffic campaigns, specifically audio, 
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+ display, video and playlist promotions. We have also surveyed our users via Global Web Index, across different verticalized questions and audience behavior for example, their favorite car brand and made this available via a tool to our clients to support their campaigns.
+
+ Marketing
+
+ Over the last nine years, we have endeavored to build a strong and local brand, focusing on our mission to provide users with the ability to socialize and get entertained beyond simply listening to music. As we grew and became the leading music streaming platform in MENA, we decided to refresh our brand during the first quarter of 2022 to highlight the importance of both music lovers and creators in growing the ecosystem and to show our commitment to empower our users to share their voice with the world. Anghami, the World is Listening . 
+
+ We believe we are the leading brand with 84% aided awareness in comparison to our direct competitors according to a study conducted in 2019 by Global Web Index in the Saudi Arabia, the UAE and Egypt.
+
+ Our key differentiator is our ability to adapt our marketing strategy to seasonality and our agile approach to real-time events which allows us to be relevant and closer to users while sounding familiar. We listen to our different user segments and create custom experiences based on their different needs in each market or region. We make use of the different internal and external marketing touchpoints to ensure we have a 360 coverage in our communications throughout the user journey in-app and through external channels. The objective being to have a unified and efficient way to spread brand love while acquiring, engaging, retaining and converting users to our premium service: Anghami Plus.
+
+ Digital Marketing
+
+ Our digital footprint covers all leading networks in our key markets driving mainly our performance and social media marketing. We rely heavily on data analytics and experimentation in our decision making by using internal tools and custom dashboards that reflect the performance of our campaigns and ongoing efforts. 
+
+ This data allows us to continuously optimize and make strategic budgeting allocation decisions and drive optimal performance results in each market, platform and channel at any given point in time. 
+
+ On social media, our aim has always been to build a strong and engaged community with our users, artists and partners. An example of which has been by rewarding our Anghami Premium service users by giving them the chance to win exclusive signed merchandise from their favorite local and international artists. Our most recent addition has been our blog Anghami talks which was created in order to keep all stakeholders up-to-date by showcasing our latest business and product news and updates which allowed us to have better press coverage.
+
+ During 2021 we expanded our influencer marketing efforts, which is allowing us to increase our targeted reach while collaborating with artists and content creators from different industries. We ve also grown our digital coverage with relevant affiliate channel partners that have the most relevant audience segments for our business in the region, this helped us reduce considerably our costs while improving our performance and the quality of the users we bring in.
+
+ Owned Media
+
+ We deploy lifecycle marketing and communication efforts on our own platform by using all owned channels from push, email marketing, SMS, native display and audio ads. Our in-app process is built on user behavior throughout their lifecycle, but tailored to each person. A new user will go through an on-boarding process for us to better understand their music taste, they can optionally choose to opt in to Anghami Premium, completely for free during the trial period, and discover the full Anghami experience. And we use the power of machine learning to recommend customized and relevant content and communication at the relevant time in their journey, in an effort to keep our users engaged and retained. One great example is our yearly 2021 End of Year campaign. We leverage our usage data to provide an engaging experience personalized to each and every user with the ability to drive shareability and virality. This campaign consistently increases our engagement and resurrects dormant users.
+
+ We offer free trials of Anghami Premium service in all our markets and have created custom pricing models with a wide option of payment methods to cater to all user segments. We also offer a wide range discounted plan price, some of which are seasonal campaigns and some are available throughout the year.
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+ Offline Marketing
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+ In the early days and through our partnership with MBC, Anghami relied a lot on TV media for brand building and brand affinity. This helped increase our brand presence in the region, especially through the association with the popular TV shows such as The Voice and Arab Idol. We run several out-of-home campaigns in Egypt, Saudi Arabia, UAE and Lebanon, throughout the year, promoting the brand as well as new releases and artists. We also get offline exposure through key partners such as the Dubai International Airport where we offer free and easy web access to our platform to all airport visitors when accessing the Wi-Fi landing page. We also get support from our Telco partners who run major co-branded outdoor campaigns across the region.
+
+ In 2017, we launched our brand ambassador program in over 10 universities in Egypt with the objective of creating an active community among the youth. Additionally, we have organized and taken part in different local events, concerts and music festivals across major markets, which have been recently paused due to the COVID-19 pandemic.
+
+ Competition
+
+ We compete for the time and attention of our users across different forms of media, including traditional broadcast, terrestrial, satellite, and internet radio, other providers of on-demand music streaming services (Spotify, YouTube, YouTube Music, Apple Music, Deezer, Google Play Music, and SoundCloud), and other providers of in-home and mobile entertainment such as cable television, video streaming services, and social media and networking websites. We compete to attract, engage, and retain users with other content providers based on a number of factors, including quality of the user experience, content range and quality, ease of use of the Anghami application, price, accessibility, perceptions of advertising load on our Ad-Supported Free service, brand awareness, and reputation. Many of our competitors enjoy competitive advantages such as greater name recognition, legacy operating histories, and larger marketing budgets, as well as greater financial, technical, human, and other resources. In addition, some of our competitors, including Google, Apple, and Amazon have developed, and continue to develop, devices for which their music streaming service is preloaded, creating a visibility advantage.
+
+ Additionally, we compete to attract and retain advertisers and a share of their advertising spend for our Ad-Supported Free service. We believe our ability to compete depends primarily on the reputation and strength of our brand as well as our reach and ability to deliver a strong return on investment to our advertisers, which is driven by the size of our Ad-Supported free user database, our advertising products, our targeting, delivery and measurement capabilities, and other tools.
+
+ We also compete to attract and retain highly talented individuals, including data scientists, engineers, product designers, and product managers. Our ability to attract and retain personnel is driven by compensation, culture, and the reputation and strength of our brand. We believe we provide competitive compensation packages and foster a team-oriented culture where each employee is encouraged to have a meaningful contribution to Anghami. We also believe the reputation and strength of our brand helps us attract individuals that are passionate about our brand.
+
+ For information on competition-related risks, see Risk Factors Risks Related to Our Business Model, Strategy, and Performance If our efforts to attract prospective users, retain existing users, and effectively monetize our products and services are not successful, our growth prospects and revenue will be adversely affected, Risk Factors Risks Related to Our Operations We face and will continue to face competition for Ad-Supported Free service users, Premium service users, and user listening time, and Risk Factors Risks Related to Our Operations Our business depends on a strong brand, and any failure to maintain, protect, and enhance the brand would hurt our ability to retain or expand our base of Ad-Supported Free service users, Premium service users, and advertisers. 
+
+ Intellectual Property
+
+ Our success depends in part upon our ability to protect our technologies and intellectual property. To accomplish this, we rely on a combination of intellectual property rights, including trade secrets, patents, copyrights, and trademarks, as well as contractual restrictions, technological measures, and other methods.
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+ We have filed and acquired several active patent applications and issued patents in the MENA Operating Area, the United States and other countries. We continue to pursue additional patent protection, both in the United States and 
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+ other countries outside the MENA Operating Area, where appropriate and cost effective. We intend to hold these patents as part of our strategy to protect and defend our technology, including to protect and defend Anghami in patent-related litigation.
+
+ Our registered trademarks include our primary mark Anghami and various versions of the Anghami logo. In addition, Anghami is registered in several jurisdictions such as New York, the European Union, UK, Switzerland, UAE, Saudi Arabia, Lebanon, Jordan and Egypt. We also have pending trademark applications in the United States, and other countries for certain Anghami marks. Finally, we have a portfolio of internet domain names, including our primary domain www.anghami.com.
+
+ In addition to the forms of intellectual property listed above, we own rights to proprietary processes and trade secrets, including those underlying the Anghami platform. We use contractual and technological means to control the use and distribution of our proprietary software, trade secrets, and other confidential information, both internally and externally, including contractual protections with employees, contractors, customers, and partners. Finally, we also have licenses with various rights holders to stream sound recordings and the musical compositions embodied therein, as further described under Licensing Agreements below, as well as licenses to stream sound recordings in videos and other types of content.
+
+ Licensing Agreements
+
+ In order to stream music to our users, we generally secure rights both to the sound recordings and the musical compositions embodied therein (i.e., the musical notes and the lyrics). To secure such rights, we obtain licenses from, and pay royalties to, rights holders or their agents. Below is a summary of certain provisions of our license agreements.
+
+ Sound Recording License Agreements with Major and Independent Record Labels
+
+ We have license agreements with record label affiliates of the three largest music companies for English/International Music Universal Music Group, Sony Music Entertainment, and Warner Music Group as well as Merlin, which represents the digital rights on behalf of numerous independent record labels. Similarly, we have license agreements with independent labels, as well as companies known as aggregators (for example, Believe International).
+
+ For Arabic music we have similar license agreements in place with Rotana, Mazzika, Qanawat, Chbk, Nay for Media, and Watary which represent digital rights on behalf of prominent Arabic artists. These agreements typically require us to pay royalties and make minimum guaranteed payments, and they include marketing commitments, advertising inventory, and financial and data reporting obligations. The sound recording rights granted to us with respect to these agreements, generally having a duration of 1 year; top 20 labels account for 81% of total streams for the year ended December 31, 2021. These license agreements, generally are not automatically renewable and apply to the Middle East in case of the international major labels and globally for the Arabic labels and aggregators. The license agreements also allow for the record label to terminate the agreement in certain circumstances, including, for example, our failure to timely pay sums due within a certain period, our breach of material terms. These agreements generally provide that the record labels have the right to audit us for compliance with the terms of these agreements. Further, they contain most favored nations provisions, which require that certain material contract terms are at least as favorable as the terms we have agreed to with any other record label. As of December 31, 2021, we have estimated future minimum guarantee commitments of approximately $7,115,551 in the next two years. See the section entitled Risk Factors Risks Related to Our Business and Industry Minimum guarantees required under certain of our license agreements for sound recordings and underlying musical compositions may limit our operations and may adversely affect its business, operating results, and financial condition. 
+
+ Musical Composition License Agreements with Music Publishers
+
+ With respect to the underlying musical compositions embodied in the sound recordings we stream, we generally secure both reproduction ( mechanical ) and public performance rights from the owners of the compositions (or their agents). In the United States, the rates we pay are for mechanical rights, a function of a ratemaking proceeding conducted by an administrative agency called the Copyright Royalty Board. The most recent proceeding before the Copyright Royalty Board (the Phonorecords III Proceedings ) set the rates for the Section 115 compulsory license for calendar years 2018 to 2022. The Copyright Royalty Board issued its initial written determination on January 26, 
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+ 2018 and set up the Mechanical Licensing Collective (The MLC). The MLC is a nonprofit organization designated by the U.S. Copyright Office pursuant to the historic Music Modernization Act of 2018. In January 2021, The MLC began administering blanket mechanical licenses to eligible streaming and download services (digital service providers or DSPs) in the United States, which Anghami opted for and obtained a Blanket License for Mechanical Rights in the US. The MLC collects the royalties due under those licenses from the DSPs and pays songwriters, composers, lyricists, and music publishers. We currently believe that the current rates will not materially impact our business, operating results, and financial condition in the US as although the US is our biggest market outside of the MENA Operating Area, it is not significant in comparison to our markets in the MENA Operating Area. However, if our business does decide to expand fully (with Arabic and International music both) in the US market, and does not perform as expected or if the rates are modified to be higher than the proposed rates, our content acquisition costs could increase and impact our ability to obtain content on pricing terms favorable to us, which could negatively harm our business, operating results, and financial condition and hinder our ability to provide interactive features in our services, or cause one or more of our services not to be economically viable in US.
+
+ In the United States, public performance rights are generally obtained through intermediaries known as PROs, which negotiate blanket licenses with copyright users for the public performance of compositions in their repertory, collect royalties under such licenses, and distribute those royalties to copyright owners. We have obtained public performance licenses from, and pay license fees to, the major PROs in the United States, including ASCAP, and are in the process of obtaining licenses from other prominent PRO, including SESAC, Inc., among others. These agreements have music usage reporting obligations and audit rights for the PROs. In addition, these agreements typically have one to two year terms, and some have continuous renewal provisions, with either party able to terminate for convenience with one to two months prior written notice, and are limited to the territory of the United States and its territories and possessions.
+
+ With respect to publishing rights in the MENA Operating Area, Anghami pays on the rates to various rights owners through a ratemaking process conducted on a case-by-case basis negotiating each license. We obtain mechanical and performance licenses for musical compositions either through local collecting societies representing publishers or from publishers directly, or a combination thereof. There are cases of publishing deals which are represented by bodies or agents which combine both Mechanical and Public Performance rights. Since in many countries in the MENA Operating Areas there are no collection societies we cannot guarantee that our licenses with the existing few collecting societies and/or our direct licenses with publishers provide full coverage for all of the musical compositions we make available to our users in such countries. As such there is a fragmented copyright licensing landscape which leads to publishers, songwriters, and other rights holders choosing not to be represented by collecting societies and that adversely impacts our ability to secure favorable licensing arrangements in connection with musical compositions that such rights holders own or control, including increasing the costs of licensing such musical compositions, or subjecting us to significant liability for copyright infringement. Some Arabic labels cover Anghami on publishing rights; these labels own the mechanical and public performance rights of their content. Accordingly, our licensing agreements cover both master rights and publishing rights. The market share of those labels amount to 17% of total Anghami streams in 2021.
+
+ From time to time, our license agreements with certain rights holders and/or their agents, including both sound recording license agreements with major and independent record labels and musical composition license agreements with music publishers, may expire while we negotiate renewals. Per industry custom and practice, we and those rights holders may continue such agreements on a month-to-month basis or enter into other short-term extensions, and/or continue to operate as if the license agreement had been extended (including by our continuing to make music available). It also is possible that such agreements will never be renewed at all. The lack of renewal, or termination, of one or more of our license agreements, or the renewal of a license agreement on less favorable terms, could have a material adverse effect on our business, financial condition, and results of operations. See Risk Factors Risks Related to Our Business Model, Strategy and Performance We have no control over the providers of our content, and our business may be adversely affected if the access to music is limited or delayed. The concentration of control of content by our major providers means that even one entity, or a small number of entities working together, may unilaterally affect our access to music and other content. 
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+ We also obtain licenses directly from artists, through our Dashboard License Agreement, that contains simpler terms of the licensing agreement signed with the labels and distributors.
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+ We opted to create new and original content as part of our Anghami Originals project, whereby we create new content for artists through collaboration agreements, in addition to hosting and producing Anghami Sessions with the artists whereby the latter performs his/her songs in a different format and set up. Anghami Originals and Anghami Sessions intellectual property is sometimes owned by Anghami or by the artist or even co-owned, with ownership being addressed on a case by case basis. Anghami also produces music in various forms for brands. This branded content is owned by the brands and promoted on Anghami.
+
+ Government Regulations
+
+ We are subject to many U.S. federal and state, European, Luxembourg, MENA Operating Area and other foreign laws and regulations, including those related to privacy, data protection, content regulation, intellectual property, consumer protection, rights of publicity, health and safety, employment and labor, competition, and taxation. These laws and regulations are constantly evolving and may be interpreted, applied, created, or amended in a manner that could harm our business. In addition, it is possible that certain governments may seek to block or limit our products or otherwise impose other restrictions that may affect the accessibility or usability of any or all of our products for an extended period of time or indefinitely.
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+ In the area of information security and data protection, the laws in several jurisdictions require companies to implement specific information security controls to protect certain types of information. Data protection, privacy, consumer protection, content regulation, and other laws and regulations are very stringent and vary from jurisdiction to jurisdiction. In particular, we are subject to the data protection/privacy regulation under the laws of the EU.
+
+ The framework legislation at an EU level with respect to data protection currently is Directive 95/46/EC (the Data Protection Directive ). The purpose of the Data Protection Directive is to provide for the protection of the individual s right to privacy with respect to the processing of personal data. Each member state is obligated to have national legislation consistent with the Data Protection Directive. We are therefore subject to the local implementing rules of the European countries where we are established (for example, Luxembourg and Sweden). These local laws can impose stringent rules relating to the way in which we process personal data.
+
+ The Data Protection Directive will be superseded by the General Data Protection Regulation ( GDPR ), which came into effect on May 25, 2018. The GDPR is intended to create a single legal framework that applies across all EU member states. However, there are certain areas where EU member states can derogate from the requirements in their own legislation. It is therefore likely that we will need to comply with these local regulations in addition to the GDPR. Local Supervisory Authorities will be able to impose fines of up to 4% of annual worldwide turnover of the preceding financial year or 20 million, whichever is greater, for non-compliance. These data protection authorities will have the power to carry out audits, require companies to cease or change processing, request information, and obtain access to premises. Where consent is relied upon as the legal basis for processing personal data, businesses must be able to demonstrate that the data subjects gave their consent to the processing of their personal data and will bear the burden of proof that consent was validly obtained and can be withdrawn at any time. The GDPR implemented more stringent operational requirements for processors and controllers of personal data, including, for example, requiring enhanced disclosures to data subjects about how personal data is processed, limiting retention periods of personal data, requiring mandatory data breach notification, and requiring additional policies and procedures to comply with the accountability principle under the GDPR. In addition, data subjects have more robust rights with regard to their personal data.
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+ Our privacy policy and terms and conditions of use describe our practices concerning the use, transmission, and disclosure of user information and are posted on our website.
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+ Employees
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+ As of December 31, 2021 and 2020, we had 174 and 114 full-time and part-time employees, respectively, including 5 part-time employees as of December 31, 2021 and seven part-time employees as of December 31, 2020. The following table provides a breakdown of our employee base by function as of the dates indicated:
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+ Department
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+ As of December 31, 2021
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+ 
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+ As of December 31, 2020
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+ 
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+ Engineering Department
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+ 61
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+ 45
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+ Sales and Marketing
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+ 39
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+ 
+ 
+ 
+ 22
+
+ 
+ 
+
+ 
+ 
+ Business Development
+
+ 
+ 
+ 
+ 11
+
+ 
+ 
+ 
+ 4
+
+ 
+ 
+
+ 
+ 
+ Finance and Administration
+
+ 
+ 
+ 
+ 24
+
+ 
+ 
+ 
+ 14
+
+ 
+ 
+
+ 
+ 
+ Operations
+
+ 
+ 
+ 
+ 39
+
+ 
+ 
+ 
+ 29
+
+ 
+ 
+
+ 
+ The following table provides a breakdown of our employee base by geographic location as of the dates indicated:
+
+ 
+
+ 
+ 
+
+ Location
+
+ 
+ 
+ 
+ As of December 31, 2021
+
+ 
+ 
+ 
+ As of December 31, 2020
+
+ 
+ 
+
+ 
+ 
+ Abu Dhabi
+
+ 
+ 
+ 
+ 60
+
+ 
+ 
+ 
+ 0
+
+ 
+ 
+
+ 
+ 
+ Beirut
+
+ 
+ 
+ 
+ 74
+
+ 
+ 
+ 
+ 91
+
+ 
+ 
+
+ 
+ 
+ Cairo
+
+ 
+ 
+ 
+ 14
+
+ 
+ 
+ 
+ 7
+
+ 
+ 
+
+ 
+ 
+ Dubai
+
+ 
+ 
+ 
+ 20
+
+ 
+ 
+ 
+ 14
+
+ 
+ 
+
+ 
+ 
+ Riyadh
+
+ 
+ 
+ 
+ 6
+
+ 
+ 
+ 
+ 2
+
+ 
+ 
+
+ 
+ Organizational Structure
+
+ Anghami is a limited liability company incorporated in the Cayman Islands on 14 February 2012. Anghami owns and controls multiple subsidiaries in Egypt, Saudi Arabia, United Arabi Emirates, Lebanon and UK.
+
+ Anghami Inc. was incorporated on March 1, 2021 and a wholly owned subsidiary of Anghami. On February 3, 2022, upon the completion of the business combination with VMAC, Anghami and VMAC (later renamed as Anghami (DE) Inc.) became wholly owned subsidiaries of Anghami Inc. See also the diagram illustrating our current organizational structure under Business Corporate History and Structure. 
+
+ Property, Plants and Equipment
+
+ Our headquarters are in Abu Dhabi, the capital of the UAE, at the Abu Dhabi Global Markets ADGM . The ADIO, being the Abu Dhabi government s investment attraction and development hub, has committed to providing up to approximately AED 60 million (which would have been approximately $16.5 million) in financial incentives to support the establishment, growth and development of our technology and research and development center in Abu Dhabi. Pursuant to the incentive programme agreement entered into between ADIO and Anghami, dated December 23, 2020, as amended on September 26, 2021. Anghami will be entitled to receive these financial incentives, in the form of rebates, only upon meeting certain performance metrics and conditions. These include, establishing the project plan (which includes setting up the new global headquarters in Abu Dhabi and moving personnel to such office), certain employment commitments and investment commitments. Based on these achievements, Anghami will have to submit quarterly financial reports and ADIO has the right to approve these reports and determine applicable rebates payable for such quarter. In addition, we have agreed to use reasonable efforts to explore a dual listing on the Abu Dhabi Securities Exchange if Anghami determines that a dual listing is in its best interest, subject to prevailing market conditions, within 18 months of entering into the agreement. We also lease regional offices in Beirut, Dubai, Cairo and Riyadh. Our computing needs are fully serviced from our cloud infrastructure. We believe that our current facilities are adequate to meet our needs for the near future and that suitable additional or alternative space will be available on commercially reasonable terms to accommodate our foreseeable future operations. However, we may expand our footprint if circumstances or business concerns warrant doing so.
+
+ 
+
+ 95
+
+ Table of Contents
+
+ 
+ MANAGEMENT
+
+ References in this section to we , our , us and the Company generally refer to Anghami Inc. and its consolidated subsidiaries.
+
+ Management and Board of Directors
+
+ Our directors and senior management are as follows:
+
+ 
+
+ 
+ 
+
+ Name
+
+ 
+ 
+ 
+ Age
+
+ 
+ 
+ 
+ Position
+
+ 
+ 
+
+ 
+ 
+ Edgard Maroun
+
+ 
+ 
+ 
+ 47
+
+ 
+ 
+ 
+ Chief Executive Officer, Director
+
+ 
+ 
+
+ 
+ 
+ Elias Habib
+
+ 
+ 
+ 
+ 49
+
+ 
+ 
+ 
+ Chief Technology Officer, Chairman
+
+ 
+ 
+
+ 
+ 
+ Choucri Khairallah
+
+ 
+ 
+ 
+ 36
+
+ 
+ 
+ 
+ Chief Premium Officer
+
+ 
+ 
+
+ 
+ 
+ Omar Sukarieh
+
+ 
+ 
+ 
+ 36
+
+ 
+ 
+ 
+ Vice President, Finance
+
+ 
+ 
+
+ 
+ 
+ Mary Monir Shafik Ghobrial
+
+ 
+ 
+ 
+ 51
+
+ 
+ 
+ 
+ Chief Strategy and Operations Officer
+
+ 
+ 
+
+ 
+ 
+ Hossam El Gamal
+
+ 
+ 
+ 
+ 47
+
+ 
+ 
+ 
+ Chief Brand Officer
+
+ 
+ 
+
+ 
+ 
+ Raja Baz
+
+ 
+ 
+ 
+ 33
+
+ 
+ 
+ 
+ Deputy Chief Technology Officer
+
+ 
+ 
+
+ 
+ 
+ F. Jacob Cherian
+
+ 
+ 
+ 
+ 57
+
+ 
+ 
+ 
+ Co-Chief Executive Officer, Director
+
+ 
+ 
+
+ 
+ 
+ Walid Samir Hanna
+
+ 
+ 
+ 
+ 50
+
+ 
+ 
+ 
+ Director
+
+ 
+ 
+
+ 
+ 
+ Kaswara Saria Alkhatib
+
+ 
+ 
+ 
+ 53
+
+ 
+ 
+ 
+ Director
+
+ 
+ 
+
+ 
+ 
+ Maha Al-Qattan
+
+ 
+ 
+ 
+ 38
+
+ 
+ 
+ 
+ Director
+
+ 
+ 
+
+ 
+ 
+ Jana Yamani
+
+ 
+ 
+ 
+ 34
+
+ 
+ 
+ 
+ Director
+
+ 
+ 
+
+ 
+ 
+ Klaas Baks
+
+ 
+ 
+ 
+ 48
+
+ 
+ 
+ 
+ Director
+
+ 
+ 
+
+ 
+ 
+ Abhayanand Singh
+
+ 
+ 
+ 
+ 40
+
+ 
+ 
+ 
+ Director
+
+ 
+ 
+
+ 
+ 
+ Fawad Tariq Khan 
+
+ 
+ 
+ 
+ 39
+
+ 
+ 
+ 
+ Director
+
+ 
+ 
+
+ 
+ 
+ Wissam Moukahal
+
+ 
+ 
+ 
+ 49
+
+ 
+ 
+ 
+ Director
+
+ 
+ 
+
+ 
+ Edgard Maroun serves as our Chief Executive Officer. Mr. Maroun is Anghami s co-founder and has served as Chief Executive Officer and as a member of Anghami s Board of Directors since 2012. Mr. Maroun handles the business development and strategic partnerships among music labels, telecommunication companies, advertisers and the media. Prior to founding Anghami, Mr. Maroun was VAS Manager at PowerMeMobile, a company that engineered SMS gateways for mobile operators from 2001 to 2012. Mr. Maroun received a bachelor s degree in law and a master s degree in private law from the University of La Sagesse in Lebanon, a master s degree in business administration in international business from Bordeaux Business School (Kedge) and a master s degree in business administration from Notre Dame University, Lebanon.
+
+ Elias Habib serves as our Chief Technology Officer. Mr. Habib is Anghami s co-founder and has served as Anghami s Chief Technology Officer and as the chairman of its Board of Directors since 2012. Prior to founding Anghami, Mr. Habib was the co-founder and Chief Technology Officer of PowerMeMobile, since 2003. Previously, Mr. Habib served as IT Manager at Naharnet, and developed an online e-commerce store for Getforless. Mr. Habib received a bachelor s degree in Computer Science and a master s degree in Software Engineering from the Lebanese American University in Lebanon.
+
+ Choucri Khairallah serves as the Chief Premium Officer. Mr. Khairallah served as Anghami s since Vice President, Business Development since February 2018. As our Vice President, Business Development, Mr. Khairallah is responsible for overseeing strategy, marketing, global partnerships, and product offerings for Anghami s subscription business. Mr. Khairallah previously served as Business Development Manager and Product and Account Manager at Anghami. Prior to joining Anghami in 2013, Mr. Khairallah was Product Implementation Team Lead at Invigo. Mr. Khairallah holds a bachelor s degree in Science in Electrical and Computer Engineering from the American University of Beirut and graduated with distinction in 2007.
+
+ Omar Sukarieh serves as the Vice President, Finance. Mr. Sukarieh has 15 years of experience in corporate accounting, finance, taxation and auditing and has been the Vice President, Finance at Anghami since December 2017. Prior to joining Anghami, Mr. Sukarieh served as Financial Manager of Nymgo, Luxembourg, from 2014 to 2017 and as Senior Consultant of PricewaterhouseCoopers, from 2012 to 2014. He also held numerous 
+
+ 
+
+ 96
+
+ Table of Contents
+
+ 
+ auditor and financial analyst positions from 2009 to 2012. Mr. Sukarieh received a bachelor s degree in business administration from the University of Haigazian, Lebanon, and a master s degree in business administration from the University of Chicago Booth School of Business. He is also a CFA Chartholder.
+
+ Mary Monir Shafik Ghobrial serves as the Chief Strategy and Operations Officer. Ms. Ghobrial served as Anghami s Chief Strategy and Operations Officer since September 2021. Prior to joining Anghami, Ms. Ghobrial was the Chief Commercial Officer of Souq.com, which was acquired by Amazon in 2017, after which she continued working for Amazon as Director of Marketplace Expansion. Previously, Ms. Ghobrial led business development for Prodea Systems, a technology and services company, during which time she worked with leading telecommunications companies. Ms. Ghobrial received a bachelor s degree in Business Administration from the American University in Cairo and a master s degree in Business Administration from City, University of London s Business School.
+
+ Hossam El Gamal serves as the Chief Brand Officer. Mr. El Gamal was Anghami s Vice President, North Africa from March 2019 until the Closing of the Business Combination. He is responsible for the brand s image and experience and oversees marketing, design, public relations, and customer service. He began working at Anghami in January 2016 as a Country Director in Egypt. Prior to joining Anghami, Mr. El Gamal was Marketing Director at ALZWAD Mobile Services (ZMS) from 2011 to 2015 and Head of Retail and Channel Marketing at Etisalat Telecommunication Company from 2007 to 2011. Prior to that he served as the Head Retail Operations and Marketing for Linea Fashion. Mr. El Gamal received a bachelor s degree in Mechatronics Engineering from the Higher Technological Institute, Cairo, and a master s degree in business administration from the University of ESLSCA Business School, France.
+
+ Raja Baz serves as the Deputy Chief Technology Officer. Mr. Baz has served as Anghami s Deputy Chief Technology Officer since March 2019. He oversees Anghami s teams that develop client-side offerings and the engineering team at Anghami. Prior to becoming deputy Chief Technology Officer, Mr. Baz started his career at Anghami in November 2014 as Android engineer and later became the Lead iOS Engineer in February 2015. Before joining Anghami in 2014, Mr. Baz has served as a Software Engineer for Ubanquity from 2013 to 2014, for Walking Thumbs LLC from 2012 to 2013, and for Invigo from 2011 to 2012. Mr. Baz holds a bachelor s degree in Computer Engineering from the Lebanese American University.
+
+ F. Jacob Cherian serves as a Co-Chief Executive Officer and as a Director. Previously, Mr. Cherian served as VMAC s Chief Executive Officer and a member of its board of directors since April 2020. Mr. Cherian co-founded and served as Chief Executive Officer and a director of I-AM Capital Acquisition Company Inc. ( I-AM ), a special purpose acquisition company, from August 2017 to February 2019. I-AM completed a $50 million initial public offering in August 2017 and completed a business combination in December 2018, listing the first e-sports company on Nasdaq (Simplicity Esports & Gaming). Mr. Cherian also served as Chairman, Chief Executive Officer and director of Millennium India Acquisition Company Inc., a special purpose acquisition company, from March 2006 to October 2013, completing a $58 million initial public offering in July 2006. Millennium India completed a business combination with SMC, an India-headquartered leading diversified financial services company with over 2,500 locations in over 500 cities serving approximately 1.7 million customers in India and the Middle East. Mr. Cherian s prior work and experience with JP Morgan & Co., as a director at KPMG LLP and as Partner at Computer Sciences Corp., a Fortune 500 global information technology & services company spans 15 years and three continents of Europe, Middle East and South Asia. Mr. Cherian holds a B.A. in Accounting & Information Systems from Queens College of CUNY and an MBA in International Finance from St. John s University. He has also served as Adjunct Professor of Finance at the Tobin College of Business at St. John s University s MBA Program for ten years. Mr. Cherian has served as a member of the board of directors on a number of public and private and not-for profit boards
+
+ Walid Samir Hanna is the founder and chief executive officer of Middle East Venture Partners. Mr. Hanna has co-founded, invested in, led and exited several startups in the MENA region, spanning a range of industries with a focus on technology. Mr. Hanna has been active in venture capital and in new venture development for the past 19 years with over 50 venture capital investments executed since 2010. Prior to founding Middle East Venture Partners in July 2009, Mr. Hanna was the chief executive officer of Dubai International Capital s venture arm the Arab Business Angels Network from July 2007 until July 2009, he served as vice president of Abraaj Capital from 2006 until 2007 and as managing partner of Orange Investment Holdings from 2001 until 2005. Mr. Hanna holds a 
+
+ 
+
+ 97
+
+ Table of Contents
+
+ 
+ bachelor s degree in Economics from McGill University (Canada), and a master s in Finance from H.E.C (France). We believe Mr. Hanna is qualified to serve on our board of directors due to his extensive financial and regional knowledge.
+
+ Kaswara Saria Alkhatib is the Chairman of Webedia Arabia Holding Ltd. and the Chief Marketing Officer of Events Center (part of General Entertainment Authority of Saudi Arabia). Mr. Alkhatib has been serving as Chairman of Webedia Arabia Holding Ltd. since 2018. Prior to that, Mr. Alkhatib joined UTURN Entertainment in 2011 and served as its Chairman from March 2013 until 2018, launched Made in Saudi Films , a production and post-production house in 2009 and served as its Chief Exeucitve Officer until 2018, and founded and served as chief executive officer of FullStop in 2002. Mr. Alkhatib holds a bachelor of technology degree in Computer Engineering from Jamiat Al-Malik Abdulaziz. We believe Mr. Alkhatib is qualified to serve on our board of directors due to his extensive knowledge and experience in the broadcasting and entertainment industries.
+
+ Maha Al-Qattan is the Group Chief People Officer at DPWorld, a leading global supply chain and logistics company. Ms. Al-Qattan joined DPWorld in 2017. She also serves as a non-executive board member of SHUAA and as an executive board member of DPWorld UAE Region, DPWorld Yarimca and Hindustan Ports Private Limited. Prior to joining DPWorld, Ms. Al-Qattan served as the Regional HRBP MEA with GE from August 2013 to March 2017 and as Senior Manager Human Resources with United Holdings prior to that. Ms. Al-Qattan holds a master s degree in Industrial and Labor Relations from Cornell University and a Bachelor of Business Administration in Management and Human Resources from the University of Wisconsin-Madison. We believe Ms. Al-Qattan is qualified to serve on our board of directors due to her regional knowledge.
+
+ Jana Yamani leads MBC Talent, MBC Academy, and MBC Hope at Middle East Broadcasting Center (MBC). Mrs. Yamani joined MBC Group in October 2019. Prior to that she founded Outar International from December 2016 until October 2019, led Fellowships and Traineeships at Misk Foundation from August 2017 until September 2019, managed customer experience projects with Medallia from November 2015 until July 2016, and consulted for McKinsey & Company prior to that. Mrs. Yamani holds a master s of science degree in Computation for Design and Optimization from the Massachusetts Institute of Technology and a bachelor s degree of science in Computer Science and Mathematics from Northeastern University. We believe Mrs. Yamani is qualified to serve on our board of directors due to her knowledge and experience in the broadcasting and entertainment industries.
+
+ Dr. Klaas Baks, Ph.D. served on VMAC s board of directors since August 2020. Dr. Baks is the Co-Founder and Director of the Emory Center for Alternative Investments and has been a finance professor at Emory University s Goizueta Business School since September 2002. He teaches courses in private equity, venture capital and distressed investing and has been recognized with nine awards, including Emory University s highest award for teaching excellence, the Emory Williams Distinguished Teaching Award, the Marc F. Adler Prize for Teaching Excellence awarded by alumni and the Donald R. Keough Award for Excellence. Since October 2014, Dr. Baks has served as the Atlanta Chair for Tiger 21, a peer-to-peer learning network for high-net-worth investors whose members manage more than $50 billion and are entrepreneurs, inventors and top executives focused on improving investment acumen and exploring common issues of wealth preservation, estate planning and family dynamics. Dr. Baks also serves as a director or advisor for various companies and investment funds, including American Virtual Cloud Technologies (NASDAQ: AVCT) (since July 2017) acquired through a SPAC business combination, Buckhead One Financial (since January 2018), JOYN (from May 2017 to March 2020), Peachtree Hotel Group (since August 2016), Backend Benchmarking (since April 2018) and TWO Capital Partners (since September 2009). Dr. Baks also has served on the Investment Committee of the Westminster Schools Board of Trustees since September 2017. Prior to joining Emory University, he held positions at Fuji Bank in Tokyo, Japan, Deutsche Bank in Hong Kong and the International Monetary Fund in Washington, D.C. Dr. Baks s research and teaching focuses on issues in alternative investments, entrepreneurial finance and investment management, and he has published papers in numerous academic and business journals, including the Wall Street Journal. Dr. Baks studied at the Wharton School at the University of Pennsylvania, during which he spent two years at Harvard University as part of his doctoral research on the performance of actively managed mutual funds, and earned a Ph.D. in finance. He also earned a Master of Arts in economics from Brown University, a Master of Science in econometrics, cum laude from Groningen University and a diploma in Japanese language and business studies from Leiden University.
+
+ Abhayanand Singh served as VMAC s Co-Founder and group Chief Executive Officer since April 2018 and has served as a member of our board of directors since April 2020. Mr. Singh also has served as a director of JB Ventures Group Ltd., a film financing investment company, since May 2019. Previously, he served as the co-founder and chief 
+
+ 
+
+ 98
+
+ Table of Contents
+
+ 
+ executive officer of Indie Muviz Pte. Ltd ( Muviz ), a digital streaming and content production company. He also has experience in the banking, private equity and asset management industries, as a managing director of Pinnacle Fund Management Ltd, an investment management company, from 2010 to 2013, and as an assistant vice president at HSBC from 2005 to 2010. Over the last six years, Mr. Singh s companies have invested in more than 15 films and series across productions and distributions, which have been released worldwide, including in China and across several leading OTT/Digital platforms globally. Mr. Singh also serves as a director of Sidus Consulting Pte. Ltd., a management consulting company, and Muviz. Mr. Singh holds an MBA in marketing from Chetana s Institute of Marketing & Research Mumbai and a bachelor s degree in Business Administration from the University of Lucknow, India
+
+ Fawad Tariq Khan is the managing director at SHUAA, a leading asset management and investment banking platform with approximately $14 billion in assets under management. He joined SHUAA in 2014 and heads up its investment banking group with responsibilities for SHUAA s advisory, capital markets and credit business lines. He also serves on the board of directors of Northacre, a London-based real estate developer, and NCM Investment Company, a global foreign exchange and commodities platform. Mr. Khan started his career at Deloitte & Touche in September 2006, based out of London, before eventually joining the Dubai office where he helped set up its Middle East debt advisory practice. Mr. Khan served on multiple public companies boards in the United Kingdom, UAE, Kuwait and Bahrain. He holds a Bachelor of Science in Computer Science from University College Cork and a Master of Science in Business Studies from UCD Smurfit Business School. We believe Mr. Khan is qualified to serve on our board of directors due to his extensive financial and regional knowledge as well as public company experience.
+
+ Wissam Moukahal served as General Manager of BOS Capital and General Manager of BOS Real Estate at Bank of Sharjah Group. Prior to that, he served as Executive Chairman at Macquarie Group since 2014 following 12 years at Deloitte Middle East, of which 9 years were as audit and assurance partner. He also served as Chairman of Deloitte & Touche s Middle East Board Advisory Committee and was the financial services industry leader for Deloitte in the UAE. He has also served as a manager in Arthur Andersen & Co for almost 7 years since October 1995. Mr Moukahal holds a bachelor s degree of Business Banking and Finance from the Lebanese American University. He is also a Certified Public Accountant (CPA) from the state of California. We believe Mr. Moukahal is qualified to serve on our board of directors due to his extensive financial and regional experience and knowledge.
+
+ Family Relationships
+
+ There are no family relationships between any of the directors. There are no family relationships between any director and any of the senior management of our Company.
+
+ Arrangements or Understandings
+
+ Upon the closing of the Business Combination, our directors were appointed to three classes pursuant to the terms of the Business Combination Agreement. See Classified Board of Directors below.
+
+ Foreign Private Issuer Exemption
+
+ As a foreign private issuer, as defined by the SEC, we are permitted to follow home country corporate governance practices, instead of certain corporate governance practices required by Nasdaq for U.S. domestic issuers other than with respect to certain voting and committee requirements.
+
+ We intend to take all actions necessary for to maintain compliance as a foreign private issuer under the applicable corporate governance requirements of the Sarbanes-Oxley Act of 2002, the rules adopted by the SEC and the Nasdaq corporate governance rules and listing standards.
+
+ Because we are a foreign private issuer, our directors and senior management are not subject to short-swing profit and insider trading reporting obligations under Section 16 of the Exchange Act. They are, however, subject to the obligations to report changes in share ownership under Section 13 of the Exchange Act and related SEC rules, if applicable based on their holdings.
+
+ 
+
+ 99
+
+ Table of Contents
+
+ 
+ Corporate Governance
+
+ We believe our corporate governance is structured to align our interests with those of our shareholders. Notable features of this corporate governance include:
+
+ we have a majority of independent directors, in accordance with Nasdaq rules that apply for foreign private issuers, and independent director representation on our audit, compensation and nominating committees immediately following the consummation of the Business Combination, and our independent directors will meet regularly in executive sessions without the presence of our corporate officers or non-independent directors;
+
+ at least one of our directors qualifies as an audit committee financial expert as defined by the SEC; and
+
+ we have implemented a range of other corporate governance practices, including implementing a robust director education program.
+
+ Classified Board of Directors
+
+ In accordance with our articles of association, our Board is divided into three classes with only one class of directors being elected in each year and each class (except for those directors initially appointed as Class I and Class II directors) serving a three-year term. The initial Class I directors term will expire at the annual general meeting approving the annual accounts for the financial year ended in 2022, the initial Class II directors term will expire at the annual general meeting approving the annual accounts for the financial year ended in 2023, and the initial Class III directors term will expire at the annual general meeting approving the annual accounts for the financial year ended in 2024.
+
+ Our initial Class I directors are Walid Samir Hanna, Fawad Tariq Khan and Wissam Moukahal.
+
+ Our initial Class II directors are Kaswara Saria Alkhatib, Maha Al-Qattan, Klaas Baks and Abhayanand Singh. 
+
+ Our initial Class III directors are Elias Habib, Edgard Maroun, Jana Yamani and F. Jacob Cherian.
+
+ Independence of our Board of Directors
+
+ A majority of our board consists of independent directors and we have an independent audit committee, nominating committee and compensation committee.
+
+ Board Committees
+
+ Audit Committee
+
+ Our audit committee is responsible for, among other things:
+
+ meeting with our independent registered accounting firm regarding, among other issues, audits, and adequacy of our accounting and control systems;
+
+ monitoring the independence of the independent registered public accounting firm;
+
+ verifying the rotation of the lead (or coordinating) audit partner having primary responsibility for the audit and the audit partner responsible for reviewing the audit as required by law;
+
+ inquiring and discussing with management our compliance with applicable laws and regulations;
+
+ pre-approving all audit services and permitted non-audit services to be performed by our independent registered public accounting firm, including the fees and terms of the services to be performed;
+
+ appointing or replacing the independent registered public accounting firm;
+
+ 
+
+ 100
+
+ Table of Contents
+
+ 
+ determining the compensation and oversight of the work of the independent registered public accounting firm (including resolution of disagreements between management and the independent registered public accounting firm regarding financial reporting) for the purpose of preparing or issuing an audit report or related work;
+
+ establishing procedures for the receipt, retention and treatment of complaints received by us regarding accounting, internal accounting controls or reports which raise material issues regarding our financial statements or accounting policies;
+
+ reviewing our policies on risk assessment and risk management; and
+
+ reviewing related person transactions.
+
+ Our audit committee consists of Klaas Baks, Kaswara Saria Alkhatib and Wissam Moukahal, with Klaas Baks serving as the chair of the committee. Each of the directors who serves on the audit committee qualifies as independent directors according to the applicable rules and regulations of the SEC and Nasdaq with respect to audit committee membership. In addition, all of the audit committee members meet the requirements for financial literacy under applicable SEC and Nasdaq rules and at least one of the audit committee members qualifies as an audit committee financial expert, as such term is defined in Item 407(d) of Regulation S-K.
+
+ Compensation Committee
+
+ Our compensation committee is responsible for, among other things:
+
+ reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer s compensation, evaluating our Chief Executive Officer s performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer based on such evaluation;
+
+ reviewing and approving the compensation of all of our other executive officers;
+
+ reviewing our executive compensation policies and plans;
+
+ implementing and administering our incentive compensation equity-based remuneration plans;
+
+ assisting management in complying with any disclosure requirements;
+
+ approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our officers and employees;
+
+ reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors.; and
+
+ retaining and overseeing any compensation consultants.
+
+ Our compensation committee consists of Maha Al-Qattan, Jana Yamani and Klaas Baks, with Maha Al-Qattan serving as the chair of the committee.
+
+ Nominating Committee
+
+ Our nominating committee is responsible for, among other things:
+
+ identifying individuals qualified to become members of our board of directors, consistent with criteria approved by our board of directors;
+
+ overseeing succession planning for our Chief Executive Officer and other executive officers;
+
+ periodically reviewing our board of directors leadership structure and recommending any proposed changes to our board of directors;
+
+ overseeing an annual evaluation of the effectiveness of our board of directors and its committees; and
+
+ developing and recommending to our board of directors a set of corporate governance guidelines.
+
+ 
+
+ 101
+
+ Table of Contents
+
+ 
+ Our nominating committee consists of Fawad Tariq Khan, Maha Al-Qattan and Abhayanand Singh, with Fawad Tariq Khan serving as the chair of the committee.
+
+ Risk Oversight
+
+ Our board of directors is responsible for overseeing our risk management process. Our board of directors focuses on our general risk management strategy, the most significant risks facing us, and oversees the implementation of risk mitigation strategies by management. Our audit committee is also responsible for discussing our policies with respect to risk assessment and risk management. Our board of directors believes its administration of its risk function has not negatively affected our board of directors leadership structure.
+
+ Anghami Executive Compensation
+
+ For the year ended December 31, 2021, Anghami s executive officers received total compensation of approximately $883,346.62. The total compensation paid to Anghami s executive officers consists of base salary, and the value of stock options granted in 2021. Anghami s executive officers are also entitled to and earn sales commission as well as certain statutory medical insurance and allowances, to the extent applicable.
+
+ Compensation of Directors and Officers
+
+ Our executive compensation program reflects Anghami s compensation policies and philosophies, as they may be modified and updated from time to time.
+
+ We will pay a retainer of $35,000 per year to our non-employee directors, $20,000 per year to the chairperson of its audit committee, $20,000 per year to the chairperson of its compensation committee and $20,000 per year to the chairperson of its nominating committee.
+
+ Eligibility and Administration
+
+ Employees or directors (including executive directors), non-executive directors or consultants of Anghami Inc. or of any member of our group are eligible to participate in the LTIP. The LTIP is administered by the Compensation Committee.
+
+ Nature of the LTIP and Form of Awards
+
+ The LTIP is an umbrella arrangement which, to give the Compensation Committee maximum flexibility, allows various types of award to be granted.
+
+ It is intended that the LTIP will be used to grant Performance Share Awards, Restricted Stock Awards and Market Value Stock Options to employees, non-executive directors or consultants of any member of the Group.
+
+ Performance Share Awards must be granted subject to performance targets.
+
+ Performance Share Awards and Restricted Stock may be granted in the form of nil (or nominal) cost options to acquire ordinary shares; or contingent rights to receive ordinary shares.
+
+ Market Value Stock Options will be granted as an option to acquire ordinary shares at market value.
+
+ Individual limits
+
+ The LTIP contains individual limits which provide that the market value of ordinary shares that may be granted under award to any one awardholder in any financial year of Anghami Inc. cannot exceed 200 per cent of annual base salary.
+
+ Source of Ordinary Shares and dilution limits
+
+ Awards are satisfied by newly issued ordinary shares.
+
+ 
+
+ 102
+
+ Table of Contents
+
+ 
+ The aggregate number of ordinary shares which may be issued or transferred pursuant to awards under the LTIP shall be equal to 1,288,000 ordinary shares, which is approximately equal to 5% of our total issued share capital in issue at the time.
+
+ Grant of awards
+
+ The Compensation Committee may, in its absolute discretion, determine which participants (if any) will be selected for the grant of an award. The Compensation Committee may consider recommendations made by our executive directors as to which participants should be selected. Awards may then be granted to selected participants at any time.
+
+ No Award may be made in breach of any Dealing Restriction.
+
+ No Award may be made after February 3, 2032.
+
+ Performance targets
+
+ Performance Share Awards will always be subject to performance targets.
+
+ Performance targets are defined as any performance-related condition(s) relating to the performance of any one or more of Anghami Inc., a Subsidiary, a division and/or the awardholder measured over the applicable performance period specified for the relevant award.
+
+ The Compensation Committee has the discretion to reduce the number of ordinary shares that vest to ensure that the vesting outcome is appropriate in light of the underlying business performance of the Group.
+
+ The Compensation Committee may amend a performance target if an event occurs which causes the Compensation Committee to consider it appropriate to do so. The amended performance target shall not be materially more or less demanding to satisfy than the original performance target was when first set and must be a fairer measure of performance than the original performance target.
+
+ Vesting of awards
+
+ Performance Share Awards will normally vest on the third anniversary of grant, subject to the satisfaction of the performance targets. Restricted Stock Awards will vest on such dates as the Compensation Committee may determine on or before the grant of the awards. Market Value Stock Options will vest on such dates as the Compensation Committee may determine on or before the grant of the awards. On or before the grant of an award, the Compensation Committee shall determine whether the award shall be subject to a post-vesting holding period. If so, and to the extent that the Compensation Committee considers it appropriate, the Compensation Committee shall also determine the basis upon which the post-vesting holding period will operate.
+
+ Leaving employment
+
+ If an awardholder leaves employment with the Group his award will lapse unless he is a good leaver .
+
+ An awardholder will be a good leaver if the reason for leaving is death, ill-health, injury, disability, redundancy, retirement, the transfer of the employing business or company, or otherwise at the discretion of the Compensation Committee.
+
+ If the awardholder is a good leaver then any awards shall vest on the date on which they would have vested had the cessation not occurred subject to any performance targets being satisfied and, unless in exceptional circumstances the Compensation Committee determines otherwise, taking into account a time pro-rata reduction to reflect the period of time between grant and cessation relative to the length of the vesting period.
+
+ 
+
+ 103
+
+ Table of Contents
+
+ 
+ Corporate events
+
+ In the event of a takeover of Anghami Inc., awards shall vest early subject, unless the Compensation Committee determines otherwise, to a Time Pro-Rata Reduction.
+
+ If we are or may be affected by a demerger, delisting, special dividend or other event which, in the opinion of the Compensation Committee, would affect the market price of a Share to a material extent, the Compensation Committee may allow Awards to Vest at such time as it sees fit.
+
+ If there is an Internal Reorganisation and awardholders are invited to accept an exchange of awards, or the Compensation Committee determines that there will be an automatic exchange of awards, awards shall not vest as a result of the Internal Reorganisation, and at the end of the period in which awardholders may accept such an invitation or upon an automatic exchange of awards (as applicable), the awards shall lapse in full.
+
+ Rights attaching to ordinary shares and transferability
+
+ Ordinary shares allotted or transferred under the LTIP will rank alongside shares of the same class then in issue. We will apply to the Securities and Exchange Commission for the listing of any newly issued ordinary shares. Awards are not transferable (except on death) and are not pensionable benefits.
+
+ Amendment
+
+ The Compensation Committee may amend the LTIP in any respect.
+
+ However, no alteration or amendment may be made to any of the provisions of the LTIP if it would adversely affect the rights of an existing awardholder, except where the alteration or amendment has been approved by the awardholder who would be adversely affected by the alteration or amendment.
+
+ All alterations and amendments to the LTIP are subject to any approvals required pursuant to the rules of the applicable stock exchange or any listing, regulatory or governmental authority and taking into account any exemptions provided by such rules.
+
+ 
+
+ 104
+
+ Table of Contents
+
+ 
+ MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION 
+AND RESULTS OF OPERATIONS
+
+ You should read the following discussion and analysis of our financial condition and results of operations together with
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/ANKM_ankam-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/ANKM_ankam-inc_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..41293cc7a62d9b6c614acfe92acd3ab131778d18
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/ANKM_ankam-inc_prospectus_summary.txt
@@ -0,0 +1,57 @@
+PROSPECTUS SUMMARY 
+ The following summary highlights selected information from this prospectus and may not contain all the information that is important to you. To understand our business and this offering fully, you should read this entire prospectus carefully, including the financial statements and the related notes beginning on page F-1. This prospectus contains forward-looking statements and information relating to Ankam see Cautionary Note Regarding Forward Looking Statements on page 9. 
+ Our Company 
+ Ankam (the Company ) was incorporated in August 2018 under the laws of the State of Nevada. The Company's product is MoneySaverApp. It is an application created to aggregate various discount cards on your mobile device. This way you can get easy access to your discounts at any moment. The idea of the app appeared as a way of simplifying the use of discount cards and enabling people to share them with anyone and make cardless purchases. With this product anyone can use their discount for such services as chain stores, gas stations, car dealerships, sports clubs, laundries, pharmacies, clinics, airlines, beauty salons, restaurants, clubs, internet service providers, car repair shops, pet stores and other customer loyalty programs. 
+ Business Strategy 
+ Ankam (the company) is a Nevada C-Corporation. The company's product is MoneySaverApp created to be the simplest way to get easy access to or share your discount card with anyone from a mobile device. With this application, you can use your discounts for some of the following services: chain stores, gas stations, car dealerships, sports clubs, laundries, pharmacies, clinics, airlines, beauty salons, restaurants, clubs, Internet service providers, car repair shops, pet stores and so on, to serve their own customer loyalty programs. MoneySaverApp allows the user to: 
+ 
+ Search and filter all discount cards in one place;
+ 
+ Select your preferences and prepare a new discount card for the next shopping in seconds. Fast, free and secure;
+ 
+ Get all the info you need in one place and make a choice. Simple and effortless. 
+ 
+ Don't waste time dealing with discount cards that don't match your personal situation. See only discount card offers that make sense for you.
+ 
+ Scan your card. The process is very simple and quick. MoneySaverApp can store your own Discount Cards at your account.
+ 
+ Try our simple navigation. Well-designed interface and convenient functional, swipe to show/hide menu, tap to show/hide card information and copy to your account, tap to preview card images. All information in one place, access your card information any time and at any place.
+ As of the day of this prospectus Ankam has not yet generated any revenue and does not have a revenue-generating product. Our office space is located at 7a Mamed Abashidze St, Tbilisi, Georgia. Our telephone number is +995599420389. 
+ 
+
+ 1
+ The Company is a non-shell company as defined in the Securities Act of 1934. At present, the company owns a domain and is developing its website - ankam.net.
+ Our Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act. 
+ Our Company shall continue to be deemed an emerging growth company until the earliest of
+ . (A) The last day of the fiscal year of the issuer during which it had total annual gross revenues of $1,000,000) (as such amount is indexed for inflation every 5 years by the Commission to reflect the change in the Consumer Price Index for All Urban Consumers, published by the Bureau of Labor Statistics, setting the threshold to the nearest 1,000,000) or more; 
+ .
+ (B) The last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities of the issuer pursuant to an effective registration statement under this title 
+ .
+ (C) The date on which such issuer has, during the previous 3-year period, issued more than $1,000,000 in non-convertible debt; or 
+ .
+ (D) The date on which such issuer is deemed to be a large accelerated filer , as defined in section 240. 12b-2 of title 17, Code of Federal Regulations, or any successor thereto. 
+ As an emerging growth company, the company is exempt from Section 404(b) of Sarbanes Oxley. Section 404(a) requires Issuers to publish information in their annual reports concerning the scope and adequacy of the internal control structure and procedures for financial reporting. This statement shall also assess the effectiveness of such internal controls and procedures. 
+ Section 404(b) requires that the registered accounting firm shall, in the same report, attest to and report on the assessment on effectiveness of the internal control structure and procedures for financial reporting. 
+ As an emerging growth company, the company is exempt from Section 14A and B of the Securities Exchange Act of 1934 which require shareholder approval of executive compensation and golden parachutes. 
+ Our Company has irrevocably opted out of the extended transition period for complying with new or revised accounting standards pursuant to Section 107(b) of the Act. 
+ The Offering 
+ This prospectus covers up to 4,250,000 shares to be issued and sold by the company at a price of $0.03 per share in a direct public offering. 
+ 
+
+ 
+
+ 2
+ ABOUT THIS OFFERING 
+
+ 
+ Securities Being Offered
+ Up to 4,250,000 shares of common stock of Ankam to be sold by the company at a price of $0.03 per share.
+
+ Initial Offering Price
+ The company will sell up to 4,250,000 shares at a price of $0.03 per share.
+
+ Terms of the Offering
+ The company will offer and sell the shares of its common stock at a price of $0.03 per share in a direct offering to the public.
+
+ Termination of the Offering
+ The offering will conclude when the company has sold all the 4,250,000 shares of common stock offered by it up to a maximum of three hundred and sixty-five 365 days. The company may, in its sole discretion, decide to terminate the registration of the shares offered by the company.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/ANTX_an2_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/ANTX_an2_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..08ee777329bdd173d62333ca0304197e20d8faf3
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/ANTX_an2_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus and is qualified in its entirety by the more detailed information and financial statements included elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should carefully read this entire prospectus, including the information under the sections titled Risk Factors, Special Note Regarding Forward-Looking Statements, and Management s Discussion and Analysis of Financial Condition and Results of Operations and our financial statements and the related notes included elsewhere in this prospectus, before making an investment decision. Unless the context requires otherwise, references in this prospectus to AN2 Therapeutics, AN2, the Company, we, us, and our refer to AN2 Therapeutics, Inc. Overview We are a clinical-stage biopharmaceutical company developing treatments for rare, chronic, and serious infectious diseases with high unmet needs. Our initial product candidate is epetraborole, a once-daily oral treatment for patients with chronic non-tuberculous mycobacterial, or NTM, lung disease. Epetraborole has broad spectrum antimycobacterial activity through inhibition of an essential and universal step in bacterial protein synthesis. Its novel mechanism of action is enabled by boron chemistry, our core technology approach. We plan to conduct a Phase 2/3 pivotal clinical trial in treatment-refractory Mycobacterium avium complex, or MAC, lung disease, which is the most common type of NTM lung disease. Interim data from our completed Phase 1b dose-ranging study of epetraborole administered orally for 28 days in healthy volunteers in Australia and data from our two nonclinical chronic toxicology studies (six-month rats and nine-month non-human primates) have informed our selection of a 500 mg once-daily dose for our Phase 2/3 pivotal clinical trial in treatment-refractory MAC lung disease patients. We believe our Phase 2/3 pivotal clinical trial design, which is under review by the U.S. Food and Drug Administration, or FDA, has the potential to be sufficient for regulatory approval in the United States. We recently received clearance of our Investigational New Drug, or IND, application by the FDA to begin our Phase 1 renal impairment study, for which enrollment commenced in February 2022, and plan to initiate patient enrollment in our Phase 2/3 pivotal clinical trial in the first half of 2022, with topline results for the Phase 2 part of the trial anticipated in the middle of 2023 and for the Phase 3 part of the trial anticipated in the middle of 2024, pending any sample size adjustments that may be required to the Phase 3 portion based on treatment effects of epetraborole-containing regimens that may be observed in the Phase 2 portion of the trial, if any. We also recently received Fast Track designation by the FDA to investigate epetraborole for treatment-refractory MAC lung disease. Epetraborole has also recently been designated as a Qualified Infectious Disease Product, or QIDP, for treatment-refractory MAC lung disease by the FDA and received FDA orphan drug designation for the treatment of infections caused by NTM. Based on clinical and preclinical data generated with epetraborole, its novel mechanism of action, and the convenience associated with once-daily, oral dosing, we believe that epetraborole has the potential to become an important component of a multi-drug treatment regimen for patients suffering from NTM lung disease. Our Pipeline We are initially focused on advancing our first product candidate, epetraborole, to commercialization in NTM lung disease. We are developing epetraborole to treat MAC lung disease, which accounts for approximately 80% of NTM lung disease in the United States. We have in-licensed the exclusive worldwide development and commercialization rights for epetraborole from Anacor Pharmaceuticals, Inc., or Anacor, acquired by Pfizer Inc., or Pfizer, in 2016. Table of Contents If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company, and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. Table of Contents In addition to our development and commercial endeavors in NTM lung disease, we intend to develop epetraborole for global health initiatives, including melioidosis, using non-dilutive funding, which we plan to obtain from sources such as public and private agencies and foundations. We have entered into an Amended and Restated Global Health Agreement, or the Global Health Agreement, with Adjuvant Global Health Technology Fund L.P. and Adjuvant Global Health Technology Fund DE L.P., or together, Adjuvant, in connection with Adjuvant s investment of $12.0 million in our Series A and Series B redeemable convertible preferred stock financings. Pursuant to the Global Health Agreement, we must use reasonably diligent endeavors to develop epetraborole for melioidosis, tuberculosis, and any other mutually agreed-upon products for at-risk developing countries. We have entered into a research agreement with the National Institutes of Health, or NIH, to further early development and dose selection of epetraborole in melioidosis using the in vitro hollow fiber system. These studies are being conducted at no cost to us. We believe partnerships like this provide substantial technical and capital resources to advance the melioidosis program and provide material benefits to our company and to our NTM lung disease program as a whole. The below table summarizes our development plans for epetraborole: Our AN2 Drug Discovery Platform Our core technology approach is based on the use of boron chemistry for our drug research and development initiatives. Boron has both a distinctive ability to bind with biological targets through a reversible covalent bond and the potential to address biological targets that have been difficult to inhibit using traditional carbon-based molecules. Boron chemistry has proven to be a highly productive technology leading to the discovery of many promising drugs, particularly focused in infectious diseases. Pioneering work at Anacor led to the generation of a class of boron compounds including two FDA-approved therapies, Kerydin and Eucrisa. Our founders consist of former leaders at Anacor, including an inventor of epetraborole and a leading infectious disease expert. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Prospectus (Subject to Completion) Dated March 21, 2022 4,000,000 Shares Common Stock This is an initial public offering of shares of common stock of AN2 Therapeutics, Inc. We are offering 4,000,000 shares of our common stock. Prior to this offering, there has been no public market for our common stock. We currently expect that the initial public offering price will be between $14.00 and $16.00 per share of common stock. We have applied to list our common stock on The Nasdaq Global Market under the symbol ANTX. We are an emerging growth company as defined in the Jumpstart Our Business Act of 2012 and, as such, we have elected to comply with certain reduced reporting requirements for this prospectus and may elect to do so in future filings. Investing in our common stock involves a high degree of risk. See the section titled
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/APYP_appyea-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/APYP_appyea-inc_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a86fde151c8b95f9ee4ef908b31b2011185819df
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/APYP_appyea-inc_prospectus_summary.txt
@@ -0,0 +1,406 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary highlights information contained elsewhere in this prospectus. This summary provides an overview of selected information and
+does not contain all of the information you should consider before investing in our securities. You should read the entire prospectus
+carefully, especially the Risk Factors, and our financial statements and the accompanying notes to those statements, included
+elsewhere in this prospectus, before making an investment decision.
+
+ 
+
+Overview
+
+ 
+
+AppYea,
+Inc. is a digital health company, focused on the development of accurate wearable monitoring solutions to treat sleep apnea and snoring
+and fundamentally improve quality of life.
+
+ 
+
+Our solutions are
+based on our proprietary intellectual property portfolio comprised of Artificial Intelligence (AI) and sensing technologies
+for the tracking, analysis, and diagnosis of vital signs and other physical parameters during sleep time, offering extreme accuracy at
+affordable cost.
+
+ 
+
+AI
+is a broad term generally used to describe conditions where a machine mimics cognitive functions associated with human
+intelligence, such as learning and problem solving. Basic AI includes machine learning, where a machine uses algorithms
+to parse data, learn from it, and then make a determination or prediction about a given phenomenon. The machine is trained 
+using large amounts of data and algorithms that provide it with the ability to learn how to perform the task.
+
+ 
+
+The
+global sleep apnea and snoring market is driven in large part by solutions that can be applied in at home-settings or healthcare settings,
+as these tools will drive decisions regarding specific treatments and the associated outlays. However, despite advances in medical imaging
+and other diagnostic tools, misdiagnosis remains a common occurrence. We believe that improved diagnoses and outcomes are achievable
+through the adoption of AI-based decision support tools.
+
+ 
+
+Our
+initial focus is on the development of supporting solutions utilizing our proprietary platform. Our current business plan focuses on
+two principal devices and an App currently in development:
+
+ 
+
+DreamIT
+ Biofeedback snoring treatment wristband, combined with the SleepX App.
+
+ 
+
+This
+wristband uses unique algorithms designed by SleepX combined with sensors to monitor physiological parameters during sleep. Based on
+real time reactions, the wristband will vibrate, when necessary, in order to decrease the snoring and regulate breathing by gently bringing
+the user to a lighter sleep and thus ceasing the snoring event.
+
+ 
+
+The
+DreamIT product is currently in testing and calibration stage in preparation for serial manufacturing.
+
+ 
+
+DreamIT
+PRO is a wristband for the treatment of sleep apnea using biofeedback in combination with SleepX PRO app. The unique algorithms
+of SleepX PRO, combined with the wristband sensors, monitor sleep apnea events and additional physiological parameters during sleep,
+and when necessary, the wristband vibrates according to real time events, in order to decrease and cease sleep apnea events.
+
+ 
+
+The
+DreamIT PRO product is currently in advanced development stages, following which it would be ready to begin the testing stage in preparation
+for filing for FDA approval.
+
+ 
+
+SleepX PRO Is
+a medical application, available for downloading on a smartphone, and used to monitor breathing patterns in the sleep and
+identify sleep apnea episodes without direct contact to the user.
+
+ 
+
+The SleepX PRO product is
+currently awaiting approval from the Helsinki committee to begin clinical trials in Soroka hospital in Israel for final calibration,
+following which we will file for FDA approval.
+
+ 
+
+ 6 
+
+ 
+
+ 
+
+ 
+
+Recent
+Developments
+
+ 
+
+Funding
+arrangements
+
+ 
+
+(i)
+On November 24, 2021, the Company and Leonite Capital LLC ( Leonite ) entered into a securities purchase agreement ( SPA )
+pursuant to which Leonite purchased a 8% secured convertible promissory note (the Note ) in the aggregate principal amount
+of amount of $588,235,29 (the Principal Amount ). The Note carries an original issue discount of $88,235.29 (the OID ),
+which is included in the principal balance of the Note. Thus, the purchase price of the Note is $500,00 computed as follows: the Principal
+Amount minus the OID. Leonite remitted to us on November 24, 2021 $110,000, less $10,000 to cover Leonite s expenses, and
+remitted the balance of $390,000 on May 9, 2022, advanced upon the filing of this Registration Statement on Form S-1.
+
+ 
+
+Under
+the terms of the SPA, we issued, as a commitment fee, to Leonite 200,000 shares of our common stock on November 24, 2021 and 300,000
+warrants to purchase additional shares of our common stock at a post-split per share exercise price of $0.6. Upon receipt of the balance
+of the committed amount, we issued to Leonite an additional 200,000 shares of our common stock and 300,000 warrants to purchase additional
+shares of our common stock at a per share exercise price of $0.6.
+
+ 
+
+The
+maturity date of the Note is the earlier of 12 months from the date of each advance or the date the Company closes on a registered public
+offering (the Maturity Date ). The Note bears interest at the greater of (i) the Prime
+Rate plus two percent (2%) per annum, or (ii) eight percent (8%) (the Interest Rate ), which reset daily and shall
+accrue on a monthly basis and is payable on the first of each month following the date on which the Note was issued. The final payment
+of the Principal Amount and interest shall be paid by us to the Leonite on the Maturity Date. Leonite is entitled
+to, from time to time convert all or any amount of the Principal Amount and any accrued but unpaid interest of the Note into Common Stock,
+at a conversion price (the Conversion Price ) equal to $0.50 (post-split).
+
+ 
+
+Following
+an event of default, the Note bears interest rate of 24% per annum with a Conversion Price equal to the lesser
+of (i) the $0.50; (ii) sixty percent (60%) of the lowest trading price during the twenty one (21) consecutive trading day period
+immediately preceding the Trading Day that the Company receives a Notice of Conversion, but in any case not lower than $0.04 (on a
+post split basis).
+
+ 
+
+The
+outstanding principal amount of the Note is secured by substantially all of the assets of the Company.
+
+ 
+
+Under
+the terms of the Note, the occurrence of any of the following constitute events of default (each an Event of Default ):
+(i) the Company s failure to pay the principal, principal or other sum when due and such failure continues for three business days
+after the due date, (ii) the Company s failure to reserve a sufficient number of shares or issue shares as required under the SPA,
+(iii) breach of any material covenant or other term or condition of the SPA or any other transaction document in any material respect,
+(iv) ) the assignment by the Company for the benefit of creditors or application for or consent to the appointment of a receiver or trustee,
+or such receiver or trustee shall otherwise be appointed, (v) the entry of a monetary judgment or similar process in excess of $100,000
+if such judgment remains unvacated for 45 day, (vi) if we are delisted from our current trading market, (vii) cessation of operations
+or failure to maintain assets to operate our business, (viii) a restatement of our financial statements, (ix) cross defaults or entering
+into a variable rate transaction, (x) DTC chill , (xi) absence of a bid price for three trading days and (xii) the
+failure of this Registration Statement to be declared effective by September 24, 2022
+
+ 
+
+Under
+the SPA we agreed that Leonite, while the Note is outstanding, has a right of first refusal on any financing that we may undertake as
+well as Leonite s right, through May 24, 2023, to participate in any future financing.
+
+ 
+
+(ii)
+On August 22, 2021 Evergreen Venture partners LLC, owned by Douglas O. McKinnon, former CEO of the company, agreed to advance to the
+Company up to $265,000 in tranches under the terms of an 18 month unsecured promissory note. Under the terms of the note, which bears
+interest at a rate of 8% per annum, the investor can convert the note into shares of common stock at 35% discount to the highest daily
+trading price over the 10 days preceding conversion but in any event not less than $0.1 per share. The note contains standard
+events of default. As of the December 31, 2021, we were advanced $25,000 under the Note and there are no assurances that can be provided
+that additional funds will be forthcoming.
+
+ 7 
+
+ 
+
+ 
+
+ 
+
+In
+July 2021, we entered into a convertible loan agreement with a current shareholder for $75,000 with a maturity date of January
+29, 2023. The loan is convertible at a price equal to the variable conversion price, which is defined as 65% of the lowest daily VWAP
+in the twenty (20) Trading Days prior to the Conversion Date.
+
+ 
+
+In
+November 2021, we entered into a convertible loan agreement with for $250,000 with a maturity date of May 2023. The loan is convertible
+at a price equal to the variable conversion price, which is defined as 65% of the lowest daily VWAP in the twenty (20) Trading Days prior
+to the Conversion Date.
+
+ 
+
+Reverse
+Stock Split
+
+ 
+
+On
+November 8, 2021, the board of directors and shareholders approved a 1 for 200 reverse stock split of our outstanding common stock and
+preferred stock, to be effected on a certificate by certificate basis with all fractional shares being rounded up to the next whole share.
+The reverse stock split became effective as of March 14, 2022.
+
+ 
+
+Change
+of Control:
+
+ 
+
+On
+July 2, 2021, Boris Molchadsky, a resident of Israel, acquired in a private transaction from Todd Violette, two hundred twenty four thousand
+nine hundred ninety eight (224,998) Shares of Series A Preferred Stock of AppYea Inc., of Nevada. The Series A Preferred Shares have
+the right to vote 1,000 to 1 as common shares and convert into 1,500 to 1 of the common shares of AppYea Inc. The acquisition of the
+Preferred Shares resulted in Boris Molchadsky the majority shareholder, with the company s voting control.
+
+ 
+
+Risks
+Associated with Our Business
+
+ 
+
+Our
+business and ability to execute our business strategy are subject to a number of risks of which you should be aware before you decide
+to buy our common stock. In particular, you should consider the following risks, which are discussed more fully in the section entitled
+ Risk Factors in this prospectus, as well as the other risks described in the section captioned Risk Factors. 
+
+ 
+
+ 
+ 
+ 
+ We
+ have incurred significant losses since our inception and anticipate that we will continue to incur losses for the foreseeable future.
+ We currently have no product revenues and no products approved for commercial sale, and will need to raise additional capital to
+ operate our business.
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ will need substantial additional funding to continue our operations, which could result in significant dilution or restrictions on
+ our business activities. We may not be able to raise capital when needed, if at all, which would force us to delay, reduce or eliminate
+ our product development programs or commercialization efforts and could cause our business to fail.
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ are heavily dependent on the success of our lead product candidates (which are in various stages of development), which will require
+ significant additional efforts to develop and may prove not to be viable for commercialization.
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Leonite
+ currently has a security interest on all of our assets, including the shares of SleepX as security for note issued to it in the
+ principal amount of $588,235.29.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Failure
+ to successfully validate, develop and obtain commercial sale approval for our DreamIT, SleepX PRO and DreamIT PRO,
+ our current medical devices under development that are designed to regulate sleep cycles and prevent snoring and apnea events, could
+ harm our development strategy and operational results.
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ will rely on third parties to conduct clinical trials (if needed). If these third parties do not successfully carry out their contractual
+ duties or meet expected deadlines, we may not be able to obtain commercial sale approval for our product candidates and our business
+ could be substantially harmed.
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ will need to grow the size of our organization, and we may experience difficulties in managing any growth we may achieve.
+ 
+
+ 
+ 
+
+ 8 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ If
+ our efforts to protect the proprietary nature of the intellectual property related to our technologies are not adequate, we may not
+ be able to compete effectively in our market and our business would be harmed.
+
+ 
+ 
+
+ 
+ 
+ 
+ The
+ patent protection covering some of our product candidates may be dependent on third parties, who may not effectively maintain that
+ protection.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ If
+ we are not able to attract and retain highly qualified personnel, we may not be able to successfully implement our business strategy.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ share price is expected to be volatile and may be influenced by numerous factors, some of which are beyond our control.
+
+ 
+ 
+
+Our
+business is subject to a number of risks. You should be aware of these risks before making an investment decision. These risks are discussed
+more fully in the section of this prospectus titled Risk Factors, which begins on page 11 of this prospectus and includes:
+
+ 
+
+Corporate
+Information
+
+ 
+
+Our
+principal executive offices are located at 16 Natan Alterman Street, Gan Yavne, Israel. Our telephone number is (800) 674-3561.
+Our website address is www.appyea.com. Information contained in, or that can be accessed through, our website is not incorporated by
+reference into this prospectus, and you should not consider information on our website to be part of this prospectus.
+
+ 
+
+ 9
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/AQUNU_aquaron_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/AQUNU_aquaron_prospectus_summary.txt
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/AREN_arena_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/AREN_arena_prospectus_summary.txt
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1 THE OFFERING 7 RISK FACTORS 9 USE OF PROCEEDS 24 Market Price and Dividend Information 25 Capitalization 26 Dilution 27 BUSINESS 28 MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 35 MANAGEMENT 53 EXECUTIVE COMPENSATION 59 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT 66 CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS 69 Description of Securities 73 Shares Available for Future Sales 78 Material U.S. Federal Income and Estate Tax Consequences to Non-U.S. Holders 79 Underwriting (CONFLICTS OF INTEREST) 83 LEGAL MATTERS 91 EXPERTS 91 WHERE YOU CAN FIND ADDITIONAL INFORMATION 91 FINANCIAL STATEMENTS F-1 APPENDIX A INVESTOR POWERPOINT A-1 You should rely only on the information contained in this prospectus. Neither we nor the Underwriter have authorized anyone to provide you with different information. If anyone provides you with different information, you should not rely on it. We are not, and the Underwriter is not, making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information contained in this prospectus is accurate only as of the date on the front cover of this prospectus. Neither the delivery of this prospectus nor any sale made in connection with this prospectus shall, under any circumstances, create any implication that there has been no change in our affairs since the date of this prospectus or that the information contained in this prospectus is correct as of any time after its date. Information contained on our website, or any other website operated by us, is not part of this prospectus. This prospectus incorporates by reference market data and industry statistics and forecasts that are based on independent industry publications and other publicly available information. Although we believe these sources are reliable, we do not guarantee the accuracy or completeness of this information and we have not independently verified this information. Although we are not aware of any misstatements regarding the market and industry data presented in this prospectus and the documents incorporated herein by reference, these estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed under the heading Risk Factors contained in this prospectus and under similar headings in other documents that are incorporated by reference into this prospectus. Accordingly, investors should not place undue reliance on this information. EXPLANATORY NOTE On January 31, 2022 and February 1, 2022, we furnished a PowerPoint as Exhibit 99.2 ( Original PowerPoint ) to a Current Report on Form 8-K and a Current Report on Form 8-K/A, respectively. We have included a revised PowerPoint as an appendix to this prospectus (the Revised PowerPoint ). It is possible that despite our intentions, the Original PowerPoint may have constituted the communication of an offer to buy or sell in potential violation of Section 5 of the Securities Act of 1933, as amended (the Securities Act ). The Original PowerPoint did not contain complete information regarding us and our business, including discussions of various risks and uncertainties regarding an investment in us, which are described in this prospectus. You should instead make your investment decision only after reading this entire prospectus carefully. The information in this prospectus clarifies, supersedes and replaces the information set forth in the Original PowerPoint. Please see the section entitled Risk Factors for additional information. In an effort to provide more consistent disclosure across conformed time periods, we have updated certain of the information contained in the Original PowerPoint and have reflected such updates in this prospectus and have included the Revised PowerPoint as an appendix to this prospectus. This necessarily resulted in certain variances that we believe are immaterial. We urge investors to carefully review the information set forth in this prospectus prior to making an investment decision. i CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This prospectus contains statements that may constitute forward-looking statements. Forward-looking statements relate to future events or future performance and include, without limitation, statements concerning our business strategy, future revenues, market growth, capital requirements, product introductions, and expansion plans and the adequacy of our funding. Other statements contained in this prospectus that are not historical facts are also forward-looking statements. We have tried, wherever possible, to identify forward-looking statements by terminology such as may, will, could, should, expects, anticipates, intends, plans, believes, seeks, estimates, and other comparable terminology. Forward-looking statements in this prospectus and in any document incorporated by reference in this prospectus may include, for example, statements about: the impact of the novel coronavirus ( COVID-19 ) pandemic; our ability to attract new subscribers and to persuade existing subscribers to renew their subscriptions; our ability to attract new advertisers and to persuade existing advertisers to continue to advertise on our digital media platform; our ability to manage our growth effectively, including through strategic acquisitions; our ability to maintain an effective system of internal control over financial reporting; our ability to grow market share in our existing markets or any new markets we may enter; our ability to recruit and retain qualified personnel; our ability to respond to general economic conditions; our ability to attract, develop, and retain capable publisher partners and expert contributors; our ability to achieve and maintain profitability in the future; the success of strategic relationships with third parties; and other factors detailed under the section entitled Risk Factors. These forward-looking statements are based on information available as of the date of this prospectus and current expectations, forecasts, and assumptions, and involve a number of judgments, risks, and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. You should not place undue reliance on these forward-looking statements. ii PROSPECTUS SUMMARY This summary highlights selected information from this prospectus and may not contain all of the information that is important to you in making an investment decision. Before investing in our securities, you should carefully read this entire prospectus, including our financial statements and the related notes included in this prospectus and the information set forth under the headings Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations. See also the section entitled Where You Can Find Additional Information. Unless the context otherwise requires, references in this prospectus to The Arena Group, the Company, we, us, or our refer to The Arena Group Holdings, Inc. and our subsidiaries. Our Company We are a data-driven media company that focuses on building deep content verticals powered by a best-in-class digital media platform (the Platform ), empowering premium publishers who impact, inform, educate and entertain. Our strategy is to focus on key verticals where audiences are passionate about a topic category (e.g., sports, finance) and where we can leverage the strength of our core brands to grow our audience and monetization both within our core brands as well as our media publishers (each, a Publisher Partner ). Our focus is on leveraging the Platform and iconic brands in targeted verticals to maximize the audience, improve engagement and optimize monetization of digital publishing assets for the benefit of our users, our advertiser clients, and our 35 owned and operated properties as well as properties we run on behalf of independent Publisher Partners. We operate the media businesses for Sports Illustrated (as defined below), own and operate TheStreet, Inc. ( TheStreet ) and College Spun Media Incorporated ( The Spun and, collectively, Sports Illustrated, TheStreet and The Spun are hereinafter referred to as our Owned and Operated Businesses ), and power more than 200 independent Publisher Partners, including Biography, History, and the many team sports sites that comprise FanNation, among others. Each Publisher Partner joins the Platform by invitation-only and is drawn from premium media brands and independent publishing businesses with the objective of augmenting our position in key verticals and optimizing the performance of the Publisher Partner. Publisher Partners incur the costs in content creation on their respective channels and receive a share of the revenue associated with their content. Because of the state-of-the-art technology and large scale of the Platform and our expertise in search engine optimization (SEO), social media, subscription marketing and ad monetization, Publisher Partners continually benefit from our ongoing technological advances and bespoke audience development expertise. Additionally, we believe the lead brand within each vertical creates a halo benefit for all Publisher Partners in the vertical on both the content and technology sides. While they benefit from these critical performance improvements, they also may save substantially in technology, infrastructure, advertising sales, member marketing, and management costs. In addition, they benefit from recirculation across our Platform, which, according to Comscore, reaches 140 million users, as well as syndication to more than 25 third-party sites. Our Corporate History and Background We were originally incorporated in Delaware as Integrated Surgical Systems, Inc. ( Integrated ) in 1990. On October 11, 2016, Integrated and TheMaven Network, Inc. ( Maven Network ) entered into a share exchange agreement (the Share Exchange Agreement ), whereby the stockholders of Maven Network agreed to exchange all of the then-issued and outstanding shares of common stock for shares of common stock of Integrated. On November 4, 2016, the parties consummated a recapitalization pursuant to the Share Exchange Agreement and, as a result, Maven Network became a wholly owned subsidiary of Integrated. Integrated changed its name to theMaven, Inc. on December 2, 2016. On September 20, 2021, we re-branded to The Arena Group. NYSE American Listing, Reverse Stock Split, and Name Change On February 9, 2022, our common stock began trading on the NYSE American. 1 In order to obtain NYSE American listing approval, we implemented a Reverse Stock Split of our common stock at a 1-for-22 ratio following approval of the Reverse Stock Split by the Financial Industry Regulatory Authority ( FINRA ). The Reverse Stock Split became effective at 8:00 p.m. on February 8, 2022, with implementation at the open of trading on February 9, 2022. The Reverse Stock Split combined each 22 shares of our outstanding common stock into one share of common stock, without any change in the par value per share, and the Reverse Stock Split correspondingly, among other things, reduced the number of shares of our common stock subject to outstanding options, warrants, and convertible securities by a factor of 22, and increased the exercise price or conversion price by a factor of 22. No fractional shares will be issued in connection with the Reverse Stock Split, and any fractional shares resulting from the Reverse Stock Split will be rounded up to the nearest whole share. Except as otherwise indicated, and except in our financial statements and the notes thereto and the financial information in the Management s Discussion and Analysis of Financial Condition and Results of Operations section, all historical share and per-share amounts in this prospectus have been adjusted to reflect the 1-for-22 Reverse Stock Split, as if it was effective and as if it had occurred at the beginning of the earliest period presented. Finally, effective at 8:00 p.m. Eastern Time on February 8, 2022, our corporate name changed to The Arena Group Holdings, Inc. in conjunction with our filing a Certificate of Amendment and Certificate of Corrections with the State of Delaware and obtaining FINRA s approval of the Reverse Stock Split. Recent Developments Preliminary and Unaudited Financial Results for the Three Months and Year Ended December 31, 2021 Compared to Unaudited Financial Results for the Three Months Ended December 31, 2020 and Audited Financial Results for the Year Ended December 31, 2020 This section contains certain financial results for the following periods: (i) three months ended December 31, 2021 ( Fourth Quarter of 2021 ); (ii) year ended December 31, 2021 ( Fiscal 2021 ); (iii) three months ended December 31, 2021 ( Fourth Quarter of 2020 ); and (iv) year ended December 31, 2020 ( Fiscal 2020 ). The financial results for the Fourth Quarter of 2021 are preliminary and unaudited financial results ( Preliminary and Unaudited Fourth Quarter of 2021 Results ). The financial results for Fiscal 2021 are presented as preliminary and unaudited financial results ( Preliminary and Unaudited Fiscal 2021 ). The financial results for the Fourth Quarter of 2020 are presented as unaudited financial results ( Unaudited Fourth Quarter of 2020 Results ). The financial results for Fiscal 2020 are presented as audited financial results ( Audited Fiscal 2020 Results ). Accordingly, the tables below contain (i) consolidated statements of operations, (ii) revenue by category, (iii) cost of revenue by category and (iv) operating expenses on the following basis: Preliminary and Unaudited Fourth Quarter of 2021 Results, Preliminary and Unaudited Fiscal 2021 Results, Unaudited Fourth Quarter of 2020 Results, and Audited Fiscal 2021 Results. The Preliminary and Unaudited Fourth Quarter of 2021 Results and Preliminary and Unaudited Fiscal 2021 Results are subject to completion of our customary year-end closing, review and audit procedures and are not a comprehensive statement of our financial results for those periods. The Preliminary and Unaudited Fourth Quarter of 2021 Results and Preliminary and Unaudited Fiscal 2021 Results should not be viewed as a substitute for complete financial statements prepared in accordance with GAAP and they are not necessarily indicative of the results to be achieved in any future period. Accordingly, you should not place undue reliance on the Preliminary and Unaudited Fourth Quarter of 2021 Results and Preliminary and Unaudited Fiscal 2021 Results. The Preliminary and Unaudited Fourth Quarter of 2021 Results, Preliminary and Unaudited Fiscal 2021 Results, Unaudited Fourth Quarter of 2020 Results included below have been prepared by and are the responsibility of our management. Marcum LLP ( Marcum ), our independent registered public accounting firm, have not audited, reviewed, compiled or performed any procedures with respect to the accompanying Preliminary and Unaudited Fourth Quarter of 2021 Results and Preliminary and Unaudited Fiscal 2021 Results. Accordingly, Marcum does not express an opinion or any other form of assurance with respect thereto. The following table sets forth the statements of operations: Three Months Ended December 31, 2021 (preliminary and unaudited) Three Months Ended December 31, 2020 (unaudited) $ Change % Change Year Ended December 31, 2021 (preliminary and unaudited) Year Ended December 31, 2020 $ Change % Change Revenue $57,064,503 $42,438,611 $14,625,892 34.5% $185,000,004 $128,032,397 $56,967,607 44.5% Cost of revenue 27,484,434 26,741,492 742,942 2.8% 111,462,484 103,063,445 8,399,039 8.1% Gross profit 29,580,069 15,697,119 13,882,950 88.4% 73,537,520 24,968,952 48,568,568 194.5% Operating expenses - Selling and marketing 27,990,221 15,891,057 12,099,164 76.1% 83,112,578 43,589,239 39,523,339 90.7% General and administrative 18,183,021 11,154,347 7,028,674 63.0% 62,413,381 36,007,238 26,406,143 73.3% Depreciation and amortization 3,038,407 4,003,485 (965,078) -24.1% 15,020,405 16,280,475 (1,260,070) -7.7% Total operating expenses 49,211,649 31,048,889 18,162,760 58.5% 160,546,364 95,876,952 64,669,412 67.5% Loss from operations (19,631,580) (15,351,770) (4,279,810) 27.9% (87,008,844) (70,908,000) (16,100,844) 22.7% Other (expense) income - Change in valuation of warrant derivative liabilities (462,320) 631,215 (1,093,535) -173.2% 34,492 496,305 (461,813) -93.1% Change in valuation of embedded derivative liabilities - 398,004 (398,004) -100.0% - 2,571,004 (2,571,004) -100.0% Interest expense (2,600,747) (4,327,902) 1,727,155 -39.9% (10,296,064) (16,497,217) 6,201,153 -37.6% Interest income - 376,527 (376,527) -100.0% 471 381,026 (380,555) -99.9% Loss on conversion of convertible debt - (3,297,539) 3,297,539 -100.0% - (3,297,539) 3,297,539 -100.0% Liquidated damages (480,307) - (480,307) (2,677,922) (1,487,577) (1,190,345) 80.0% Gain upon debt extinguishment - (247,282) 247,282 -100.0% 5,716,697 (279,133) 5,995,830 -2148.0% Total other expense (3,543,374) (6,466,977) 2,923,603 -45.2% (7,222,326) (18,113,131) 10,890,805 -60.1% Loss before income taxes (23,174,954) (21,818,747) (1,356,207) 6.2% (94,231,170) (89,021,131) (5,210,039) 5.9% Income taxes - (210,832) 210,832 -100.0% 229,699 (210,832) 440,531 -208.9% Net loss (23,174,954) (22,029,579) (1,145,375) 5.2% (94,001,471) (89,231,963) (4,769,508) 5.3% Deemed dividend on convertible preferred stock - (15,509,932) 15,509,932 -100.0 % - (15,642,595) 15,642,595 -100.0% Net loss attributable to common stockholders $(23,174,954) $(37,539,511) $14,364,557 -38.3% $(94,001,471) $(104,874,558) $10,873,087 -10.4% 2 The following table sets forth revenue by category: Revenue by Category Three Months Ended December 31, 2021 (preliminary and unaudited) Three Months Ended December 31, 2020 (unaudited) $ Change % Change Year Ended December 31, 2021 (preliminary and unaudited) Year Ended December 31, 2020 $ Change % Change Digital Revenue Digital advertising $22,033,894 $11,937,683 $10,096,211 84.6% $61,429,971 $34,596,838 $26,833,133 77.6% Digital subscriptions 6,659,413 8,399,036 (1,739,623) -20.7% 29,132,364 28,495,676 636,688 2.2% Other revenue 2,747,513 1,929,443 818,070 42.4% 8,583,195 4,596,686 3,986,509 86.7% Total digital revenue 31,440,820 22,266,162 9,174,658 41.2% 99,145,530 67,689,200 31,456,330 46.5% Print Revenue Print advertising 2,042,376 3,633,508 (1,591,132) -43.8% 8,947,273 9,762,984 -815,711 -8.4% Print subscriptions 23,581,307 16,538,941 7,042,366 42.6% 76,907,201 50,580,213 26,326,988 52.0% Total print revenue 25,623,683 20,172,449 5,451,234 27.0% 85,854,474 60,343,197 25,511,277 42.3% Total revenue $57,064,503 $42,438,611 14,625,892 34.5% 185,000,004 128,032,397 56,967,607 44.5% Total preliminary and unaudited revenue for the three months ended December 31, 2021 increased approximately 34.5% to approximately $57.1 million, as compared to approximately $42.4 million for the unaudited three months ended December 31, 2020. Total preliminary and unaudited digital revenue for the three months ended December 31, 2021 increased approximately 41.2% to approximately $31.4 million as compared to approximately $22.3 million for the unaudited three months ended December 31, 2020. The increase in digital revenue period-over-period was primarily due to an approximately $10.1 million increase in digital advertising. Total preliminary and unaudited revenue for the year ended December 31, 2021 increased approximately 44.5% to approximately $185.0 million as compared to approximately $128.0 million for the year ended December 31, 2020. Total preliminary and unaudited digital revenue for the year ended December 31, 2021 increased approximately 46.5% to approximately $99.1 million as compared to approximately $67.7 million for the year ended December 31, 2020. This increase in revenues was attributable to management s decision to make a strategic shift to focus on premium content providers and reduced reliance on publisher guarantees in September 2020. As a result of this change, our revenue from Publisher Partners increased by 74.1% to approximately $34.8 million in the year ended December 31, 2021, as compared to approximately $20.0 million for the year ended December 31, 2020. Our compound annual growth rate ( CAGR ) for revenue from fiscal 2019 to fiscal 2021 was approximately 86.3%. Our CAGR for digital revenue from fiscal 2019 to fiscal 2021 was approximately 64.3%. For additional information, please see this section entitled Recent Developments and the section entitled Management s Discussion and Analysis of Financial Condition and Results of Operations. The following table sets forth cost of revenue by category: Cost of Revenue by Category Three Months Ended December 31, 2021 (preliminary and unaudited) Three Months Ended December 31, 2020 (unaudited) $ Change % Change Year Ended December 31, 2021 (preliminary and unaudited) Year Ended December 31, 2020 $ Change % Change Publisher Partner revenue share payments $6,285,605 $5,394,863 $890,742 16.5% $22,043,444 $19,427,196 $2,616,248 13.5% Hosting, bandwidth, and software licensing fees 521,837 625,292 (103,455) -16.5% 2,163,417 2,419,143 (255,726) -10.6% Fees paid for data analytics and to other outside services providers 761,385 804,850 (43,465) -5.4% 2,883,405 3,222,869 (339,464) -10.5% Royalty fees 3,750,000 3,750,000 - 0.0% 15,000,000 15,000,000 - 0.0% Content and editorial expenses 5,921,728 7,466,383 (1,544,655) -20.7% 31,618,234 29,080,353 2,537,881 8.7% Printing, distribution and fulfillment costs 3,484,098 4,444,867 (960,769) -21.6% 14,385,212 15,706,519 (1,321,307) -8.4% Amortization of our Platform 3,292,711 2,202,333 1,090,378 49.5% 9,858,311 8,550,952 1,307,359 15.3% Stock-based compensation 1,861,739 776,225 1,085,514 139.8% 6,791,447 4,339,916 2,451,531 56.5% Other cost of revenue 1,605,331 1,276,679 328,652 25.7% 6,719,014 5,316,497 1,402,517 26.4% Total cost of revenue $27,484,434 $26,741,492 $742,942 2.8% $111,462,484 $103,063,445 $8,399,039 8.1% Total preliminary and unaudited cost of revenue for the three months ended December 31, 2021 increased approximately 2.8% to approximately $27.5 million as compared to approximately $26.7 million for the unaudited three months ended December 31, 2020. The increase in cost of revenue is primarily attributable to costs associated with the amortization of our Platform, stock-based compensation and Publisher Partner revenue share payments partially offset by a decrease in content and editorial expenses and printing, distribution and fulfillment costs. Total preliminary and unaudited cost of revenue for the year ended December 31, 2021 increased approximately 8.1% to approximately $111.5 million as compared to approximately $103.1 million for the year ended December 31, 2020. The increase in cost of revenue is primarily attributable to Publisher Partner revenue share payments, content and editorial expenses and stock-based compensation. 3 The following table sets forth operating expenses: Operating Expenses Three Months Ended December 31, 2021 (preliminary and unaudited) Three Months Ended December 31, 2020 (unaudited) $ Change % Change Year Ended December 31, 2021 (preliminary and unaudited) Year Ended December 31, 2020 $ Change % Change Selling and marketing $27,990,221 $15,891,057 $12,099,164 76.1% $83,112,578 $43,589,239 $39,523,339 90.7% General and administrative 18,183,021 11,154,347 7,028,674 63.0% 62,413,381 36,007,238 26,406,143 73.3% Depreciation and amortization 3,038,407 4,003,485 (965,078) -24.1% 15,020,405 16,280,475 (1,260,070) -7.7% Total operating expenses $49,211,649 $31,048,889 $18,162,760 58.5% $160,546,364 $95,876,952 $64,669,412 67.5% Operating expenses increased 58.5% to approximately $49.2 million for the three months ended December 31, 2021, as compared to approximately $31.0 million in the prior year period. The primary driver of the increase in operating expenses was attributable to increases in selling and marketing expenses of approximately $12.1 million and general and administrative expenses of approximately $7.0 million, partially offset by a decrease in depreciation and amortization of approximately $1.0 million. Operating expenses increased 67.5% to approximately $160.5 million for the year ended December 31, 2021 as compared to approximately $95.9 million the prior year period. The primary driver of the increase in operating expenses was attributable to increases in selling and marketing expenses of approximately $39.5 million and general and administrative expenses of approximately $26.4 million, partially offset by a decrease in depreciation and amortization of approximately $1.3 million. 4 Key Performance Indicators Our management reviews several key performance indicators ( KPIs ). They are mostly non-financial indicators which inform our management of business performance and aids in determining our operating strategy and actions. These KPIs include revenue per page view ( RPM ), cost per thousand ( CPM ), the number of unique users, the number of video views on our Platform, and the number of impressions on our Platform. RPM represents the advertising revenue earned per 1,000 pageviews; CPM represents the advertising revenue earned per 1,000 advertising impressions; unique users is based on the number of unique individuals who visit a site in a given period (usually on a monthly basis); impressions is a count of the number of advertisements viewed by users; and video views is a count of the number of videos viewed by users. Unique users, impressions and video views are measures that inform management about the activity on a particular website and potential inventory of digital display and video advertisements which are available for sale. RPM and CPM are indications of yield and pricing driven by both the advertising density and demand from advertisers. These KPIs are critical for management as they provide insights into our digital revenue generation and overall business performance. This information also provides feedback on the content on the website and its ability to attract and engage users, which allows us to make strategic business decisions as our engagement increases and drives advertising revenue across all our platforms. RPM increased 39% to $18.95 for the three months ended December 31, 2021 as compared to $13.63 for the three months ended December 31, 2020, which included a 13% increase in RPM attributable to Sports Illustrated. RPM grew 71% to $15.21 for the year ended December 31, 2021, as compared to $8.90 for the year ended December 31, 2020. Overall CPM increased 9% to $2.89 for the three months ended December 31, 2021 as compared to $2.66 for the three months ended December 31, 2020. CPM for programmatic advertising revenue increased 36% to $1.86 for the year ended December 31, 2021, as compared to $1.36 for the year ended December 31, 2020. Lastly, our monthly average unique users grew 16% for the year ended December 31, 2021, as compared to the prior year, according to Comscore. Sports partners impressions increased 255% to 1.7 billion for the three months ended December 31, 2021 as compared to 484.7 million for the three months ended December 31, 2020. Video views increased 137% to 232.0 million for the three months ended December 31, 2021 as compared to 97.9 million for the three months ended December 31, 2020. Please also see the section entitled Business for additional information regarding unique users and pageviews. 5 Stock Purchase Agreements On January 24, 2022, after negotiations with certain of our current purchasers of previous securities issued by us (the Investors ), we entered into several Stock Purchase Agreements with the Investors (collectively, the Stock Purchase Agreements ), pursuant to which we agreed to issue an aggregate of 505,671 shares (11,124,278 pre-Reverse Stock Split shares) at a price equal to $13.86 ($0.63 pre-Reverse Stock Split) per share, which price was based on the volume-weighted average price of our common stock at the close of trading on the sixty (60) previous trading days, to the Investors in lieu of an aggregate of approximately $7.01 million owed in liquidated damages, which includes accrued but unpaid interest, for our failure to meet certain covenants in prior Registration Rights Agreements and related Securities Purchase Agreements with the Investors. On February 9, 2022, we terminated the Stock Purchase Agreement with B. Riley Principal Investments, LLC and cancelled the 206, 275 shares that were to be issued to them. By negotiating the Stock Purchase Agreements with the Investors, the per share price at which the shares of our common stock were issued pursuant to the Stock Purchase Agreements was higher than the assumed offering price of $12.65 ($0.575 pre-Reverse Stock Split). If, the price used to derive the number of shares of our common stock was the assumed offering price of $0.575, we would have been required to issue an aggregate of 554,015 shares (12,188,337 pre-Reverse Stock Split shares). We also agreed that we would prepare and file as soon as reasonably practicable, a registration statement covering the resale of these shares of our common stock issued in lieu of payment of these liquidated damages in cash. Amendment to Second Amended and Restated Note Purchase Agreement On January 23, 2022, we entered into Amendment No. 4 to the Second Amended and Restated Note Purchase Agreement (the Second A&R NPA ) with BRF Finance, an affiliated entity of B. Riley, in its capacity as agent and a purchaser, pursuant to which the parties agreed to extend the maturity dates in the event that we consummate an offering of our common stock of at least $20.0 million prior to February 14, 2022, as well as excluding from the mandatory prepayment provisions proceeds received from such offering. Proposed Acquisition We have entered into a letter of intent to acquire 100% of the issued and outstanding equity interests (the Proposed Acquisition ) of Athlon Holdings, Inc. ( Athlon ) for an anticipated purchase price of $16 million, comprised of (i) a cash portion of $13 million, with $10 million to be paid at closing and $3 million to be paid post-closing and (ii) an equity portion of $3 million to be paid in shares of our common stock. The acquisition of Athlon is subject to the preparation and negotiation of definitive documents, our completion of due diligence, and the agreement of a certain number of key employees of Athlon to remain as employees post-closing, among other items. We can provide no assurances that we will consummate the acquisition of Athlon on a timely or cost-effective basis, if at all. Athlon develops and distributes premium content on digital, video, and print platforms in the lifestyle, celebrity, food, health and wellness, sports, and outdoor verticals. Its brands include Athlon Sports, Athlon Outdoors, Parade, Relish and Spry Living. Athlon Sports is the leading publisher of preseason annuals for the NFL, NBA, MLB, NASCAR, and college football and basketball, including draft and fantasy issues. Athlon Outdoors publishes twelve titles for outdoor enthusiasts. Athlon Sports digital presence is already on our Platform and has over 3 million monthly unique users and Athlon Outdoors has 1 million unique uses. Parade has a circulation of over 16 million via weekly distribution in over 600 newspapers in the U.S. Spry Living and Relish each have a circulation of 9 million. Parade.com is a popular lifestyle digital publication with over 14 million monthly average unique users, placing it in the top 30 of all lifestyle publications in the U.S. Corporate Information We are a Delaware corporation. Our principal executive office is located at 200 Vesey Street, 24th Floor, New York, New York, 10281. Our telephone number is (212) 321-5002. Our website address is www.thearenagroup.net. Information on or accessed through our website is not incorporated into this prospectus and is not a part of this prospectus. 6 THE OFFERING Issuer: The Arena Group Holdings, Inc. Securities Being Offered by Us: 2,371,541 shares of our common stock (or 2,727,272 shares of our common stock if the Underwriter exercises their option to purchase additional shares in full). Offering Price: Assumed offering price of $12.65 per share (which represents the last reported bid price of our common stock as reported on the OTCQX on January 26, 2022; and as adjusted for the Reverse Stock Split). The actual offering price will be determined between the Underwriter and us at the time of pricing and may be issued at a discount to the current market price of our common stock. Risk Factors: The shares of our common stock offered hereby involve a high degree of risk and should not be purchased by investors who cannot afford the loss of their entire investment. See Risk Factors for a discussion of the factors you should carefully consider before making an investment decision. Shares
\ No newline at end of file
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@@ -0,0 +1,7223 @@
+SUMMARY
+
+ 
+
+This summary only highlights
+the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the
+information under "Risk Factors" and our financial statements and the related notes included elsewhere in this prospectus,
+before investing.
+
+ 
+
+Unless otherwise stated in this prospectus,
+references to:
+
+ 
+
+ 
+ 
+ 
+ "amended and restated memorandum and articles
+ of association" are to our memorandum and articles of association to be in effect upon completion of this offering;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ "affiliate" means a corporation, limited liability company, or other entity that controls,
+ is controlled by, or is under common control with our company or any of our company s subsidiaries;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ "BVI" are to the British Virgin Islands;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ "Companies Act" and the "Insolvency Act"
+ are to the BVI Business Companies Act, 2004 and the Insolvency Act, 2003 of the British Virgin Islands, respectively and in each
+ case as amended;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ "founder shares" are to our Class B ordinary shares,
+ with no par value, held by our initial shareholder and, unless the context otherwise requires, the term also includes our Class A
+ ordinary shares issued upon the conversion thereof as provided herein;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ "initial shareholder" is the holder of our founder shares
+ sold prior to this offering;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ "letter agreement" refers to the letter agreement by
+ and among our company, our sponsor and our officers and directors, the form of which is filed as an exhibit to the registration statement
+ of which this prospectus forms a part;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ "management" or our "management team" are
+ to our officers and directors;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ "ordinary shares" are to our Class A ordinary shares
+ and our Class B ordinary shares;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ "permitted transferees" shall mean any of the following to whom an initial shareholder
+ may transfer ordinary shares: the initial shareholder s affiliates, child, stepchild, grandchild, parent, stepparent, grandparent,
+ spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law,
+ including adoptive relationships, any person sharing the initial shareholder s household (other than a tenant or employee),
+ a trust in which these persons have more than fifty percent of the beneficial interest, a foundation in which these persons control
+ the management of assets, and any other entity in which these persons own more than fifty percent of the voting interests. Upon the
+ death of the initial shareholder, the term "permitted transferees" shall also include such deceased initial shareholder s
+ estate, executors, administrators, personal representatives, heirs, legatees and distributees, as the case may be;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ "private placement warrants" are to the warrants to be issued to our sponsor in a
+ private placement simultaneously with the closing of this offering;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ "public rights" are to the rights sold as part of the
+ units in this offering (whether they are subscribed for in this offering or in the open market);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ "public shareholders" are to the holders of our public
+ shares;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ "public shares" are to our Class A ordinary shares,
+ with no par value, offered as part of the units in this offering (whether they are subscribed for in this offering or thereafter
+ in the open market);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ "public warrants" are to our redeemable warrants sold as part of the units in this
+ offering (whether they are purchased in this offering or thereafter in the open market), to the private placement warrants if held
+ by third parties other than our sponsor (or its permitted transferees), and to any private placement warrants issued upon conversion
+ of working capital loans that are sold to third parties that are not initial purchasers or executive officers or directors (or permitted
+ transferees), in each case, following the consummation of our initial business combination;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ "rights"
+ are to our public rights sold as part of the units in this offering (whether they are purchased for
+ in this offering or thereafter in the open market);
+
+ 
+ 
+
+"representative shares" are the
+Class A ordinary shares issued to Maxim LLC: 277,500 (or 319,125 in the aggregate if the underwriters over-allotment option is
+exercised in full) representing 1.5% of the gross proceeds;
+
+ 
+
+ 
+ 
+ 
+ "sponsor"
+ is to A SPAC II (Holdings) Corp., a BVI business company with limited liability; 
+
+ 
+ 
+
+ 
+ 
+ 
+ "warrants" are to our public warrants, the private placement warrants
+ and any warrants issued upon conversion of working capital loans; and
+
+ 
+
+ 
+
+ 1
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ "we," "us," "company,"
+ "A SPAC II" or "our company" are to A SPAC II Acquisition Corp., a BVI business company with limited liability.
+
+ 
+ 
+
+All references in this
+prospectus to shares of A SPAC II Acquisition Corp. being forfeited shall take effect as surrenders for no consideration of such shares
+as a matter of British Virgin Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take
+effect as a redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of British Virgin
+Island law.
+
+ 
+
+General
+
+ 
+
+ We are a newly
+incorporated blank check company incorporated in the British Virgin Islands as a business company for the purpose of effecting a
+merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more
+businesses, which we refer to throughout this prospectus as our initial business combination. Although there is no restriction or
+limitation on what industry our target operates in, it is our intention to pursue prospective targets that are in the high-growth
+industries that apply cutting edge technologies, such as Proptech and Fintech (the "New Economy Sectors"), with a
+preference for companies that promote environmental, social and governance ("ESG") principles. We believe that
+continuous global technological breakthroughs across businesses and ESG principles will create positive impact to society and will
+facilitate opportunities that can provide our investors with attractive financial returns through a business combination. Except for
+mainland China, Hong Kong and Macau, there is no restriction on the geographic location for our target search, and it is our intent
+to pursue targets globally, with a particular focus on North America, Europe and Asia where the management team and directors have
+extensive experience and relationships. We will not undertake a business combination with any entity based in or with a majority
+of its operations in mainland China, including Hong Kong and Macau. We also intend to focus on prospective target businesses that
+have potential for revenue growth and/or operating margin expansion and strong market positions within their industries. We will
+primarily seek to acquire one or more growth businesses with a total enterprise value of between $800,000,000 and $2,000,000,000. At
+the time of preparing this prospectus, we do not have any specific business combination under consideration or contemplation, and we
+have not, nor has anyone on our behalf, contacted any prospective target business or had any discussions, formal or otherwise, with
+respect to such a transaction. Our efforts to date are limited to organizational activities related to this offering. We are a newly incorporated blank check company incorporated in the
+British Virgin Islands as a business company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase,
+reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial
+business combination. Although there is no restriction or limitation on what industry our target operates in, it is our intention to pursue
+prospective targets that are in the high-growth industries that apply cutting edge technologies, such as Proptech and Fintech (the "New
+Economy Sectors"), with a preference for companies that promote environmental, social and governance ("ESG") principles.
+We believe that continuous global technological breakthroughs across businesses and ESG principles will create positive impact to society
+and will facilitate opportunities that can provide our investors with attractive financial returns through a business combination. Except
+for mainland China, Hong Kong and Macau, there is no restriction on the geographic location for our target search, and it is our intent
+to pursue targets globally, with a particular focus on North America, Europe and Asia where the management team and directors have extensive
+experience and relationships. We will not undertake a business combination with any entity based in or with its a majority of its operations
+in mainland China, including Hong Kong and Macau. We also intend to focus on prospective target businesses that have potential for revenue
+growth and/or operating margin expansion and strong market positions within their industries. We will primarily seek to acquire one or
+more growth businesses with a total enterprise value of between $800,000,000 and $2,000,000,000. At the time of preparing this prospectus,
+we do not have any specific business combination under consideration or contemplation, and we have not, nor has anyone on our behalf,
+contacted any prospective target business or had any discussions, formal or otherwise, with respect to such a transaction. Our efforts
+to date are limited to organizational activities related to this offering. 
+
+ 
+
+Background and Competitive Strengths
+
+ 
+
+We believe the experience
+and network of relationships of our management team will give us distinct advantages in sourcing, structuring and consummating a business
+combination. We believe that our team has a diverse set of skills, including experience across business development, entrepreneurship,
+investment, finance and marketing, which will provide us access to proprietary deals, assist us in identifying and evaluating a target,
+manage risk and effect a successful business combination. However, none of our management team is obligated to remain with the company
+after an acquisition transaction, and we cannot provide assurance that the resignation or retention of our current management will be
+a term or condition in any agreement relating to an acquisition transaction. Moreover, despite the competitive advantages we believe
+we have, we remain subject to significant competition with respect to identifying and executing an acquisition transaction.
+
+ 
+
+We will seek to capitalize
+on the experience and networks of the members of our management team: Mr. Malcolm F. MacLean IV, Mr. Claudius Tsang, Mr. Anson Chan,
+Mr. Ka Wo Chan, Mr. Bryan Biniak, and Mr. Paul Cummins. Our team consists of highly experienced professionals who have significant experience
+in investing in both public and private companies. Members of our management also have extensive experience in sourcing and evaluating
+potential investment opportunities as well as deal negotiation, corporate finance, business operations and management. We have developed
+a proprietary network of relationships with business leaders, investors and intermediaries that we believe can generate deal flow for
+us. We believe that our team has a strong and complementary set of skills which will allow us to identify a target, execute a business
+combination and deliver returns for our shareholders.
+
+ 
+
+Mr. Malcolm F. MacLean IV,
+our Independent Chairman, has almost 3 decades of experience in the global investment business with a focus on the acquisition of private
+and public real estate debt and equity securities. Mr. Claudius Tsang, our Chief Executive Officer, has over 20 years of experience in
+capital markets, with a strong track record in private equity, M&A transactions and PIPE investments. Mr. Anson Chan, our Director,
+has over 20 years of experience in investment, capital markets and corporate management. Mr. Ka Wo Chan, our Director, has over a decade
+of experience in capital markets and entrepreneurship, where he ran a conglomerate that covers the spectrum from finance to luxury experiences
+and consumer goods. Mr. Bryan Biniak, our Independent Director, has over 25 years of experience in corporate management, business development,
+product innovation and entrepreneurship within a range of industries, spanning the technology, mobile, automotive, digital commerce and
+entertainment sectors. Mr. Paul Cummins, our Independent Director, has almost three decades of experience in investment, accountancy,
+strategic management, and business management.
+
+ 
+
+Our management team s
+past performance is not an assurance that we will be able to identify an appropriate candidate for our initial business combination or
+achieve success with respect to the business combination we intend to consummate. However, we believe that the skills and professional
+network of our management team will enable us to identify, structure and consummate a business combination.
+
+ 
+
+ 2
+
+ 
+
+ 
+
+ 
+
+Leadership of an Experienced
+Management Team
+
+ 
+
+ Mr. Malcolm F. MacLean
+IV will serve as our Independent Non-executive Chairman upon the effective date of the registration statement of which this prospectus
+is a part. Mr. MacLean has almost 3 decades of experience in the global investment business with a focus on the acquisition of private
+and public real estate debt and equity securities and direct property throughout Japan and non-Japan Asia, the United States and Europe,
+having structured and consummated over US$20 billion of investments over his career. Since its inception in 2006, Mr. MacLean has been
+the Founder, Managing Partner and Director of Star Asia Group, with offices in Tokyo and the U.S. Mr. MacLean is responsible for the
+day-to-day investment activities at the firm as Co-chair of the Investment Committee. Since its inception in December 2006, Star Asia
+Group has acquired or developed over $9 billion of real estate and real estate related assets. In 2009, Mr. MacLean co-founded Taurus
+Capital Partners LLC, which makes opportunistic investments in public and private companies, partnerships and other structured vehicles
+globally. Previously, Mr. MacLean was the President, Portfolio Manager and Head Trader for Mercury Global Real Estate Advisors LLC, a
+global real estate investment firm with offices in Greenwich, Tokyo, Singapore and Hong Kong. In addition, Mr. MacLean has extensive
+experience as Lead Manager in originating, structuring and executing equity, debt and M&A transactions for public and private real
+estate companies globally having advised in and completed transactions totaling in excess of $15 billion while an investment banker for
+eight years (1992-1999). Mr. MacLean was a Senior Vice President of PaineWebber s and Kidder Peabody & Co s (now UBS)
+Real Estate Investment Banking Groups in New York. Through one of the Star Asia Group entities, Mr. MacLean is the sponsor of Star Asia
+Investment Corporation (TSE: 3468), a public traded JREIT with approximately JPY180 billion of assets under management in 2021. Since
+2019, he has been a Member of the Board of Directors of Polaris Holdings Co., Inc. (TSE: 3010), an owner and operator of hotels in Japan.
+Since February 2021, Mr. MacLean has also been a Member of the Board of Directors of Evo Acquisition Corp (NASDQ: EVOJ). Mr. MacLean
+studied International Economics at Cambridge University in England and graduated from Trinity College in Hartford, Connecticut with a
+B.A. in Economics and Law. We believe Mr. MacLean is qualified to serve on our board of directors based on his global investment experience.
+
+ 
+
+Mr. Claudius Tsang has
+served as our Chief Executive Officer and Chief Financial Officer since July 2021. Mr. Tsang has over 20 years of experience in capital
+markets, with a strong track record of success in private equity, M&A transactions, and PIPE investments. Mr. Tsang was the
+Co-head of Private Equity (North Asia) at Templeton Asset Management Limited and a Partner of Templeton Private Equity Partners, a leading
+global emerging markets private equity firm that is part of Franklin Templeton Investments. During his 15-year career at Templeton, Mr.
+Tsang served in various positions, including Partner, Senior Executive Director, and Vice President. Mr. Tsang was responsible for the
+overall investment, management, and operations activities of Templeton Private Equity Partners in North Asia. His role encompassed overseeing
+the analysis and evaluation of opportunities for strategic equity investments in Asia. During his tenure, Mr. Tsang managed $1 billion
+in private equity funds, with approximately 50 portfolio companies. He was also involved in the management of a $3 billion fund, which
+was the largest Central Eastern European listed closed-end fund at the time of IPO in London. From July 2007 to June 2008,
+Mr. Tsang joined Lehman Brothers, where he managed private equity projects in Hong Kong, China, Taiwan and the United States. At
+Lehman Brothers, Mr. Tsang managed $500 million proprietary funds. Mr. Tsang has served as the Chief Executive Officer and Chairman of
+Model Performance Acquisition Corp., since March 2021, and July 2021 respectively, and has served at A SPAC I Acquisition Corp. as the
+Chief Executive Officer since April 2021 and as the Chief Financial Officer and Chairman since July, 2021. Mr. Tsang has also served
+as the Chief Investment Officer of JVSPAC Acquisition Corp. since April 2021, and as the Executive Director and Chief Executive Officer
+of A SPAC (HK) Acquisition Corp since March 2022. Mr. Tsang has served as a director of the CFA Society of Hong Kong from 2013 to
+2021. Mr. Tsang obtained a Master of Business Administration from the University of Chicago Booth School of Business in 2017, a
+bachelor s degree in law from Tsinghua University in 2005, and a bachelor s degree in engineering from the Chinese University
+of Hong Kong in 1998. Mr. Tsang is also a CFA charterholder. We believe that Mr. Tsang is qualified to serve on our Board of Directors
+based on his experience and expertise.
+
+ 
+
+Mr. Anson Chan will serve
+as our director upon the effective date of the registration statement of which this prospectus is a part. Mr. Chan has over 20 years
+of experience in investment, capital markets and corporate management. Since 2007, Mr. Chan has served as the Chairman and Chief Executive
+Officer of Bonds Group of Companies, a multi-national investment company with businesses ranging from financial investments to real estate
+development, investment property management and hotel operations. The Bonds Group of Companies owns and operates commercial, retail,
+hotel, and residential properties in prime locations in China, Taiwan, Singapore, Canada, the USA, and the U.K. Under Mr. Chan s
+leadership, the Bonds Group of Companies has expanded to approximately $2.5 billion in net assets. From 2005 to 2008, Mr. Chan was a
+Senior Advisor to the Hong Kong office of Elliott Associates, a leading U.S. based activist investment fund with assets under management
+of over $10 billion. From 2000 to 2004, Mr. Chan was an Associate Director for Nomura International, a leading Japanese investment bank.
+While at Nomura International, Mr. Chan was responsible for leading investments into pre-IPO investments. From 1998 to 2000, Mr. Chan
+was at AIG Investment Corporation ("AIGIC"), a company that provides investment advice and market asset management products.
+He was responsible for developing new investment opportunities in private equity and oversaw the Pearl River Delta Fund s divestment
+process. Mr. Chan obtained his Bachelor of Arts degree with a double major in Economics and Political Science from the University of
+California, Berkeley, and an M.B.A. from University of Toronto, Canada. He is currently a Ph.D. candidate at Fudan University s
+School of International Relations and Public Administration. We believe that Mr. Chan is qualified to serve on our board of directors
+based on his investment and corporate management expertise.
+
+ 
+
+Mr. Ka Wo Chan will serve
+as our director upon the effective date of the registration statement of which this prospectus is a part. Mr. Chan has over a decade
+of experience in capital markets and entrepreneurship, where he ran a conglomerate that covers the spectrum from finance to luxury experiences
+and consumer goods. Mr. Chan founded Best Leader Financial Group and has acted as its chairman since 2013. Under his leadership, the
+conglomerate grew to encompass Best Leader Precious Metals Limited, Best Leader Wealth Management Limited, and Shenzhen Qianhai Best
+Leader Precious Metals Limited, which provide trading services in precious metals, gold bullions and commodities to retail clients, institutions
+and wealth management services across Asia. Since its establishment, Mr. Chan has expanded the business across Australia and the Asia
+Pacific region. Since 2018, Mr. Chan has been the founder and director of Voyager Financial Group Limited, a licensed insurance brokerage
+in Hong Kong with a specialty in yachts and luxury goods. During his tenure, the company achieved an annual insured volume of over HK$7
+billion. In 2017, Mr. Chan established Sweetbriar Equine Ltd., a company focused on breeding and nurturing equestrian thoroughbred horses.
+In 2016, Mr. Chan and his family founded Marketsense Financial Holdings Ltd., which provides one-stop investment services to customers.
+Under Mr. Chan s leadership, Marketsense has acted as lead manager or underwriters to numerous IPO listings, including Space Group
+Holdings Ltd., which provides fitting-out works and building construction works in Macau, with a market capitalization of approximately
+HK$2.4 billion as of May 2021. Since 2016, Mr. Chan has been the Founder, Chairman and Chief Executive Officer of House of Connoisseur
+Ltd., a premium wine importer, wholesaler and retailer in Hong Kong. Under Mr. Chan s strategic leadership, House of Connoisseur
+Ltd. has become a recognized brand name in the local wine industry with over $15 million annual sales turnover in 2020. Mr. Chan is also
+Co-chairman of the 2020/2021 Flag Day Organizing Committee of the Community Chest, Chinese People s Political Consultative Conference
+Member of the 12th Hubei Province Committee, the fifth council member of the China Overseas Friendship Association, and Honorary Chairman
+of the New Zealand Chinese Jockey Club. Mr. Chan obtained his bachelor s degree in 2017 from the University of Management &
+Technology. We believe that Mr. Chan is qualified to serve as our director based on his management, entrepreneurship and capital markets
+expertise.
+
+ 
+
+Mr. Bryan Biniak will serve
+as our Independent Director upon the effective date of the registration statement of which this prospectus is a part. Mr. Biniak has
+over 25 years of experience in corporate management, business development, product innovation and entrepreneurship within a range of
+industries, spanning the technology, mobile, automotive, digital commerce and entertainment sectors. Since 2021, Mr. Biniak has served
+as a President and Chief Operating Officer at Songtradr Inc., a B2B music technology company. In 2016, Mr. Biniak cofounded ConnectedTravel,
+a connected vehicle platform and application services company, and has served as the Chairman and Chief Executive Officer since its establishment.
+From 2015 to 2016, Mr. Biniak was an Entrepreneur in Residence at NGP Capital, Nokia Corporation s venture capital company where
+he led virtual reality, augmented reality, and mixed reality strategy and investments. Mr. Biniak accumulated extensive experience from
+his previous positions as General Manager and Partner at Microsoft from 2014 to 2015, and Global Vice President and General Manager at
+Nokia from 2010 to 2014 where he led their global app store business, developer ecosystem, platform and tool development supporting Nokia s
+numerous device owners. He founded and served Chief Executive Officer at Jacked, a provider of interactive television application services
+for sports broadcasting from 2006 to 2010. Mr. Biniak also serves as a board member at numerous institutions, including Los Angeles Auto
+Show and AutoMobility LA since 2014, Boston University s College of Arts & Sciences since 2009, and has been a member of the
+board of trustees at New Roads School in California since 2019. Mr. Biniak holds a Bachelor of Arts in International Relations, Business
+and Economics from Boston University. We believe Mr. Biniak is qualified to serve on our board of directors based on his corporate and
+business management expertise.
+
+ 
+
+Mr. Paul Cummins will serve
+as our Independent Director upon the effective date of the registration statement of which this prospectus is a part. Mr. Cummins has
+almost three decades of experience in investment, accountancy, strategic management, and business management. In 2008, Mr. Cummins co-founded
+Pyrrho Management Ltd., a family investment fund with assets and investments across the globe, and has served in multiple positions at
+the firm since then, including as Director and Investment Director. Mr. Cummins is responsible for managing the company s global
+assets, seeking new investment opportunities, and overseeing the strategic development of the company. From 2005 to 2008, Mr. Cummins
+served as Chief Financial Officer for Sino Era Ltd. and Yifung Alternative Energy Ltd., an alternative energy business. From 2000 to
+2005, Mr. Cummins served as Senior Trader for Nomura International Plc. London and Hong Kong under Nomura s proprietary investment
+team. From 1998 to 2000, Mr. Cummins served as Senior Manager at KPMG Hong Kong. Over the years, Mr. Cummins has cumulated extensive
+experience from his directorship and partnerships at numerous companies, including as Director at Crimson Tiger Ltd. since 2016 and Non-executive
+Chairman at Pacific Jade Corporate Services Limited and its predecessors since 2011. Mr. Cummins is a Chartered Accountant in England
+and Wales. Mr. Cummins holds a bachelor s degree in Economics from the University of Kingston. We believe Mr. Cummins is qualified
+to serve on our board of directors based on his investment, accountancy, strategic management and business management expertise.
+
+ 
+
+ 3
+
+ 
+
+ 
+
+ 
+
+Established
+Deal Sourcing Network
+
+ 
+
+We believe the extensive
+global investment and finance experience as well as the strong track record of our management team will enable us to get access to an
+attractive and compelling deal pipeline. We intend to leverage our management team s industry experiences, proven deal sourcing
+capabilities and broad network of relationships in numerous industries, including business executives, entrepreneurs, media relationships,
+institutional investors, family offices, investment bankers and attorneys, which we believe will provide us with a pipeline of business
+combination opportunities.
+
+ 
+
+We expect that the collective
+experience, capability and network of our directors and other officers, combined with their individual and collective reputations in
+the investment and business community, will provide us with attractive prospective business combination opportunities. Moreover, our
+management team with its contacts and resources will also enable A SPAC II Acquisition Corp. to pursue complementary follow-on business
+arrangements.
+
+ 
+
+Our team will deploy a proactive
+sourcing strategy and focus our efforts on companies where we believe the combination of our team s operating experience, business
+development prowess, professional relationships and tactical expertise can be catalysts to enhance the growth potential and value of
+a target business and provide opportunities for attractive returns to our shareholders. We believe that our backgrounds will enable us
+to identify these companies, conduct efficient due diligence, make an appealing case of strategic relevance to the target, articulate
+an attractive growth case to public-market investors.
+
+ 
+
+Status as
+a Publicly Listed Acquisition Company
+
+ 
+
+We believe our structure
+will make us an attractive business combination partner to prospective target businesses. As a publicly listed company, we will offer
+a target business an alternative to the traditional initial public offering process. We believe that some target businesses will favor
+this alternative, which we believe is less expensive more efficient and offers a greater certainty of execution and flexibility compared
+to the traditional initial public offering process. Furthermore, the benefit of being a public listed company includes improved access
+to capital which could allow the targets to accelerate growth, pursue new projects, retain and hire employees, and expand into new geographies
+or businesses.
+
+ 
+
+With respect to the foregoing
+examples and descriptions, past performance by our management team is not a guarantee either (i) of success with respect to any
+business combination we may consummate or (ii) that we will be able to identify a suitable candidate for our initial business combination.
+Potential investors should not rely upon the historical record of our management as indicative of future performance.
+
+ 
+
+Acquisition Strategy 
+
+ 
+
+Our efforts in identifying
+prospective target businesses will not be limited to a particular industry or country although we intend to focus on businesses in the
+high-growth industries that apply cutting edge technologies, such as Proptech and Fintech, with a preference for companies that promote
+ESG principles. In particular, we intend to focus our search for an initial business combination on private companies that have compelling
+economics and recurring revenue, a defensible market position and successful management teams that are seeking to expand their operations
+and gain access to new capital markets. These criteria are not intended to be exhaustive. Any evaluation of the merits of a particular
+initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors,
+and criteria that the management team, directors, and advisory board may deem relevant.
+
+ 
+
+We believe the New Economy
+Sectors have a strong growth trajectory due to important trends such as increasing digitization and the innovation and adoption of new
+technologies. We believe that businesses have experienced tremendous growth and expansion in recent years with a wide range of technological
+breakthroughs impacting industries and business models globally. Such innovations include developments in artificial intelligence, Saas,
+communications, data analytics, cloud computing, machine learning, Proptech and Fintech. Furthermore, we believe that the adoption and
+demand for fast growing new economy technologies will continue to accelerate in the COVID-19 environment. We anticipate that the continued
+adoption of cutting edge solutions and products position the New Economy Sector for significant long-term growth. As the New Economy
+continues to grow more sophisticated and improve, we believe there to be many potential targets within this industry that could become
+attractive public companies.
+
+ 
+
+Our management team also
+expects to favor target companies that demonstrate a dedication to ESG principles. We believe that the concept of ESG investing is growing
+in significance amongst both institutional and retail investors. Today, ethical considerations and alignment with values is gaining traction
+and according to a survey by Natixis Investment Management, the percentage of institutional investors who implement ESG rose by 18% between
+2019 and 2021. It is our view that ESG principles can contribute to a company s success after business combination. As such, we
+believe that targets in the New Economy Sector with strong ESG principles may encompass a range of companies that could make attractive
+targets for us.
+
+ 
+
+We will seek to capitalize
+on the strength of our management team. We believe that our board and management s experiences, including their experience in evaluating
+assets through investing, company building and strategic management, will enable us to identify businesses that have the capacity for
+cash flow creation, opportunity for operational improvement and robust company fundamentals, and enable us to execute a business combination
+with high-quality targets. Our selection process will leverage our board and management s broad network of relationships with leading
+start-ups, established and reputable MNCs and respected peers, as well as our industry and execution expertise and deal sourcing capabilities.
+Together with this network of trusted partners, we intend to capitalize the target business and create purposeful strategic initiatives
+in order to achieve attractive growth and performance after our initial business combination. We are not prohibited from pursuing an
+initial business combination with a company that is affiliated with our sponsor, officers or directors, or completing the business combination
+through a joint venture or other form of shared ownership with our sponsor, officers or directors. In the event we seek to complete our
+initial business combination with a target that is affiliated with our sponsor, officers or directors, we, or a committee of independent
+directors, would obtain an opinion from an independent firm that commonly renders valuation opinions, independent accounting firm or
+independent investment banking firm that our initial business combination is fair to our company from a financial point of view. We are
+not required to obtain such an opinion in any other context.
+
+ 
+
+ 4
+
+ 
+
+ 
+
+ 
+
+Investment Criteria
+
+ 
+
+Consistent with our strategy,
+we will primarily seek to acquire one or more growth businesses with a total enterprise value of between $800,000,000 and $2,000,000,000.
+Although we may decide to enter into our initial business combination with a target business that does not meet the criteria described
+below, we have identified the following general criteria and guidelines as we evaluate prospective target companies:
+
+ 
+
+ 
+ 
+ 
+ Distinct competitive advantage and/or underexploited growth opportunities that our team is positioned
+ to identify;
+
+ 
+ 
+
+We intend to seek target companies
+that have competitive advantages and/or underexploited expansion opportunities that can benefit from access to additional capital as
+well as expertise. We believe a large number of companies suffer from a lack of insightful strategy and capital for growth. We intend
+to target businesses that possess favorable future growth characteristics, combined with a durable business model that is resistant to
+macroeconomic volatility. Our management team has significant experience in identifying such targets and in helping target management
+assess the strategic and financial fit.
+
+ 
+
+ 
+ 
+ 
+ Strong management team that can create significant value for the target
+ company;
+
+ 
+ 
+
+We will seek to identify companies
+with strong and experienced management team. We believe we can provide a platform for the existing management team to leverage the experience
+of our management team. We believe that the operating expertise of our management team will be well suited to complement a target s
+management team.
+
+ 
+
+ 
+ 
+ 
+ Ready to be public, and will benefit from access to capital market;
+
+ 
+ 
+
+We will look for public-ready management
+teams that have a track record of value creation for their shareholders, with the ambition to take advantage of the improved liquidity
+and additional capital that can come from a successful listing in the United States. We believe that there are a substantial number of
+potential target businesses with appropriate valuations that can benefit from a public listing and new capital to support significant
+revenue and earnings growth.
+
+ 
+
+ 
+ 
+ 
+ Exhibit unrecognized value or other characteristics that we believe
+ have been misevaluated by the market;
+
+ 
+ 
+
+We will seek target companies which
+exhibit characteristics that we believe have been overlooked or misevaluated by the marketplace based on our company-specific analyses
+and due diligence. We intend to leverage the significant experience and disciplined investment approach of our team to identify opportunities
+to unlock value that our experience in complex situations allows us to pursue.
+
+ 
+
+Sourcing of Potential Business Combination Targets
+
+ 
+
+We believe that the operational
+and transactional experience of our management team and their respective affiliates, and the relationships they have developed as a result
+of such experience, will provide us with a substantial number of potential business combination targets. These individuals and entities
+have developed a broad network of contacts and corporate relationships around the world. This network has grown through sourcing, acquiring
+and financing businesses, relationships with sellers and company executives, as well as through our collective experience in executing
+transactions under varying economic and financial market conditions. We believe that these networks of contacts and relationships will
+provide us important sources of investment opportunities. In addition, we anticipate that target business candidates may be brought to
+our attention from various unaffiliated sources, including investment market participants, private equity funds and large business enterprises
+seeking to divest non-core assets or divisions.
+
+ 
+
+Our acquisition criteria,
+due diligence processes and value creation methods are not intended to be exhaustive. Any evaluation relating to the merits of a particular
+initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors
+and criteria that our management may deem relevant. Our search for a business combination, ability to consummate a business combination,
+or the operations of a target business with which we ultimately consummate a business combination, may be materially adversely affected
+by factors beyond our control.
+
+ 
+
+ 5
+
+ 
+
+ 
+
+ 
+
+Other Acquisition Considerations
+
+ 
+
+We are not prohibited from
+pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek
+to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee
+of independent directors, will obtain an opinion from an independent investment banking firm or another independent firm that commonly
+renders valuation opinions or an independent accounting firm that our initial business combination is fair to our company from a financial
+point of view.
+
+ 
+
+Our sponsor, officers, and
+directors have agreed that we will have only 15 months from the closing of this offering (or up to 21 months from the closing of this
+offering if we extend the period of time to consummate a business combination by the full amount of time) to complete our initial business
+combination. If we are unable to complete our initial business combination within such 15-month period (or up to 21 months from the closing
+of this offering if we extend the period of time to consummate a business combination by the full amount of time), we will: (i) cease
+all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days
+thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust
+account, including interest (which interest shall be net of taxes payable, and less up to $50,000 of interest to pay dissolution expenses)
+divided by the number of then outstanding public shares, which redemption will completely extinguish public shareholders rights
+as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as
+promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our Board of Directors,
+liquidate and dissolve, subject in each case to our obligations under British Virgin Islands law to provide for claims of creditors and
+the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our public
+warrants, public rights or private placement warrants. The warrants and rights will expire worthless if we fail to complete our initial
+business combination within the 15-month time period (or up to 21 months from the closing of this offering if we extend the period of
+time to consummate a business combination by the full amount of time).
+
+ 
+
+Unless we complete our initial
+business combination with an affiliated entity, or our Board of Directors cannot independently determine the fair market value of the
+target business or businesses, we are not required to obtain an opinion from an independent investment banking firm, another independent
+firm that commonly renders valuation opinions or from an independent accounting firm that the price we are paying for a target is fair
+to our company from a financial point of view. If no opinion is obtained, our shareholders will be relying on the business judgment of
+our Board of Directors, which will have significant discretion in choosing the standard used to establish the fair market value of the
+target or targets, and different methods of valuation may vary greatly in outcome from one another. Such standards used will be disclosed
+in our tender offer documents or proxy solicitation materials, as applicable, related to our initial business combination.
+
+ 
+
+Members of our management
+team may directly or indirectly own our Class A ordinary shares and/or private placement warrants following this offering, and,
+accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which
+to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect
+to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a
+target business as a condition to any agreement with respect to our initial business combination.
+
+ 
+
+Each of our directors and
+officers presently has, and in the future any of our directors and our officers may have additional, fiduciary or contractual obligations
+to other entities pursuant to which such officer or director is or will be required to present acquisition opportunities to such entity.
+Accordingly, subject to his or her fiduciary duties under British Virgin Islands law, if any of our officers or directors becomes aware
+of an acquisition opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations,
+he or she will need to honor his or her fiduciary or contractual obligations to present such acquisition opportunity to such entity,
+and only present it to us if such entity rejects the opportunity. Our amended and restated memorandum and articles of association will
+provide that, subject to his or her fiduciary duties under British Virgin Islands law, we renounce our interest in any corporate opportunity
+offered to any officer or director unless such opportunity is expressly offered to such person solely in his or her capacity as a director
+or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be
+reasonable for us to pursue. We do not believe, however, that any fiduciary duties or contractual obligations of our directors or officers
+would materially undermine our ability to complete our business combination.
+
+ 
+
+ 6
+
+ 
+
+ 
+
+ 
+
+Our sponsor, officers and
+directors are, and may become a sponsor, an officer or director of other special purpose acquisition companies with a class of securities
+registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act. Notwithstanding that, such officers and directors
+will continue to have a pre-existing fiduciary obligation to us, and we will, therefore, have priority over any special purpose acquisition
+companies they subsequently join.
+
+ 
+
+Initial Business Combination
+
+ 
+
+NASDAQ rules require
+that our initial business combination must be with one or more target businesses that together have an aggregate fair market value equal
+to at least 80% of the balance in the trust account (less any deferred underwriting commissions and any taxes payable on interest earned)
+at the time of our signing a definitive agreement in connection with our initial business combination. If our Board of Directors is not
+able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent
+investment banking firm or another independent firm that commonly renders valuation opinions or an independent accounting firm. We do
+not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination.
+
+ 
+
+We will have until 15 months
+from the closing of this offering to consummate an initial business combination. However, if we anticipate that we may not be able to
+consummate our initial business combination within 15 months, we may extend the period of time to consummate a business combination up
+to two times, each by an additional three months (for a total of up to 21 months to complete a business combination). Pursuant to the
+terms of our amended and restated memorandum and articles of association and the trust agreement to be entered into between us and Continental
+Stock Transfer & Trust Company on the date of this prospectus, in order to extend the time available for us to consummate our
+initial business combination, our sponsor or its affiliates or designees, upon ten days advance notice prior to the applicable deadline,
+must deposit into the trust account $1,850,000, or up to $2,127,500 if the underwriters over-allotment option is exercised in full ($0.10
+per share in either case) on or prior to the date of the applicable deadline, for each three month extension (or up to an aggregate of
+$3,700,000 (or $4,255,000 if the underwriters over-allotment option is exercised in full), or $0.20 per share if we extend for the full
+six months). Any such payments would be made in the form of a loan. Any such loans will be non-interest bearing and payable upon the
+consummation of our initial business combination. If we complete our initial business combination, we would repay such loaned amounts
+out of the proceeds of the trust account released to us. Up to $1,150,000 of such loans may be convertible into warrants at a price of
+$1.00 per warrant at the option of the lender. If we do not complete a business combination, we will not repay such loans. Furthermore,
+the letter agreement with our initial shareholder contains a provision pursuant to which our sponsor has agreed to waive its right to
+be repaid for such loans out of the funds held in the trust account in the event that we do not complete a business combination. Our
+sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial
+business combination. You will not be able to vote on or redeem your shares in connection with any such extension.
+
+ 
+
+If we are unable to consummate
+an initial business combination within such time period, we will, as promptly as reasonably possible but not more than ten business days
+thereafter, redeem 100% of the outstanding public shares, at a per-share price, payable in cash, equal to the aggregate amount then on
+deposit in the trust account, including any interest earned on the funds held in the trust account (net of interest that may be used
+by us to pay our taxes payable and for dissolution expenses), divided by the number of then outstanding public shares, which redemption
+will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions,
+if any), subject to applicable law and as further described herein, and then seek to dissolve and liquidate. We expect the pro rata redemption
+price to be approximately $10.175 per public share (regardless of whether or not the underwriters exercise their over-allotment option)
+(subject to increase of up to an additional $0.20 per share in the event that our sponsor elects to extend the period of time to consummate
+a business combination by the full six months), without taking into account any interest earned on such funds. However, we cannot assure
+you that we will in fact be able to distribute such amounts as a result of claims of creditors which may take priority over the claims
+of our public shareholders.
+
+ 
+
+ 7
+
+ 
+
+ 
+
+ 
+
+We anticipate structuring
+our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire
+100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination
+such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to
+meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination
+if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires
+a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company
+Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting
+securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction
+company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue
+a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target.
+In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number
+of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding
+shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses
+are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will
+be valued for purposes of the 80% of net assets test. If our initial business combination involves more than one target business, the
+80% of net assets test will be based on the aggregate value of all of the target businesses.
+
+ 
+
+Prior to the date of this
+prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12
+of the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no
+current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to
+the consummation of our initial business combination.
+
+ 
+
+Potential Conflicts
+
+ 
+
+Members of our management
+team will directly or indirectly own ordinary shares, or other instruments, such as warrants, linked to our ordinary shares, following
+this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate
+business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of
+interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors
+was included by a target business as a condition to any agreement with respect to our initial business combination.
+
+ 
+
+Our officers and directors
+have agreed to present to us all target business opportunities that have a fair market value of at least 80% of the assets held in the
+trust account, subject to any fiduciary or contractual obligations they may have. As more fully discussed in "Management —
+Conflicts of Interest", if any of our officers or directors becomes aware of a business combination opportunity that falls within
+the line of business of any entity to which he or she has pre-existing fiduciary or contractual obligations, he or she may be required
+to present such business combination opportunity to such entity prior to presenting such business combination opportunity to us, subject
+to his or her fiduciary duties under British Virgin Islands law. All of our officers currently have certain relevant fiduciary duties
+or contractual obligations that may take priority over their duties to us. For more information on the relevant pre-existing fiduciary
+duties or contractual obligations of our management team, see the section titled "Management — Conflicts of Interest".
+
+ 
+
+Implication of the Holding
+Foreign Companies Accountable Act
+
+ 
+
+The Holding Foreign Companies
+Accountable Act (the "HFCA Act") was enacted on December 18, 2020. The HFCA Act states that if the SEC determines that an
+issuer s audit reports issued by a registered public accounting firm have not been subject to inspection by the PCAOB for three
+consecutive years beginning in 2021, the SEC shall prohibit such issuer s securities from being traded on a national securities
+exchange or in the over-the-counter trading market in the United States.. Therefore, the combined company s securities may be delisted
+from a national securities exchange in the U.S. pursuant to the HFCA Act.
+
+ 
+
+Corporate Information
+
+ 
+
+Our executive offices are
+located at 289 Beach Road #03-01 Singapore 199552 and our telephone number is +65 6818 5796.
+
+ 
+
+We are an "emerging
+growth company," as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified
+by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions
+from various reporting requirements that are applicable to other public companies that are not "emerging growth companies"
+including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley
+Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy
+statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval
+of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may
+be a less active trading market for our securities and the prices of our securities may be more volatile.
+
+ 
+
+In addition, Section 107
+of the JOBS Act also provides that an "emerging growth company" can take advantage of the extended transition period provided
+in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an "emerging
+growth company" can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.
+We intend to take advantage of the benefits of this extended transition period.
+
+ 
+
+We will remain an emerging
+growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion
+of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed
+to be a large accelerated filer, which means the market value of our ordinary shares that are held by non-affiliates exceeds $700 million
+as of the end of that year s second fiscal quarter; and (2) the date on which we have issued more than $1.00 billion in non-convertible
+debt securities during the prior three-year period. References herein to "emerging growth company" shall have the meaning
+associated with it in the JOBS Act.
+
+ 
+
+Additionally, we are a "smaller
+reporting company" as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain
+reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain
+a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates
+exceeds $250 million as of the end of that year s second fiscal quarter, or (2) our annual revenues exceeded $100 million
+during such completed fiscal year and the market value of our ordinary shares held by non-affiliates exceeds $700 million as of the end
+of that year s second fiscal quarter.
+
+ 
+
+ 8
+
+ 
+
+ 
+
+ 
+
+THE OFFERING
+
+ 
+
+In
+making your decision whether to invest in our securities, you should take into account not only the backgrounds of the members of our
+management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in
+compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors
+in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled
+ "Risk Factors" beginning on page 30 of this prospectus.
+
+ 
+
+ 
+ Securities
+ offered
+ 
+ 18,500,000 units, at $10.00 per unit, each
+ unit consisting of:
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ one Class A
+ ordinary share;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ one-half of one redeemable
+ warrant to purchase one Class A ordinary share; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ one right to receive one-tenth
+ (1/10) of one Class A ordinary share upon the consummation of our initial business combination.
+
+ 
+ 
+ 
+ 
+
+ 
+ Proposed
+ NASDAQ symbols
+ 
+ Units: "ASCBU"
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Class A Ordinary Shares: "ASCB"
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Warrants: "ASCBW"
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Rights: "ASCBR" 
+
+ 
+ 
+ 
+ 
+
+ 
+ Trading
+ commencement and separation of Class A ordinary shares, warrants and rights
+ 
+ The units will
+ begin trading promptly after the date of this prospectus. The Class A ordinary shares, warrants and rights comprising the units
+ will begin separate trading on the 52nd day following the date of this prospectus unless Maxim informs us of its decision to allow
+ earlier separate trading, subject to our having filed the Current Report on Form 8-K described below announcing when such separate
+ trading will begin. Once the Class A ordinary shares, warrants and rights commence separate trading, holders will have the option
+ to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact
+ our transfer agent in order to separate the units into Class A ordinary shares, warrants and rights.
+
+ 
+ 
+ 
+ 
+
+ 
+ Separate
+ trading of the Class A ordinary shares, warrants and rights is prohibited until we have filed a Current Report on Form 8-K
+ 
+ In no event
+ will the Class A ordinary shares, warrants and rights be traded separately until we have filed with the SEC a Current Report
+ on Form 8-K which includes an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering.
+ We will file the Current Report on Form 8-K promptly after the closing of this offering, which is anticipated to take place
+ three business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the
+ initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide
+ updated financial information to reflect the exercise of the underwriters over-allotment option.
+
+ 
+ 
+ 
+ 
+
+ 
+ Units:
+ 
+ 
+
+ 
+ Number
+ outstanding before this offering
+ 
+ 0
+
+ 
+ 
+ 
+ 
+
+ 
+ Number
+ outstanding after this offering
+ 
+ 18,500,0001
+
+ 
+ 
+ 
+ 
+
+ 
+ Ordinary
+ shares:
+ 
+ 
+
+ 
+ Number
+ issued and outstanding before this offering
+ 
+ 5,318,750 Class
+ B ordinary shares2,4
+
+ 
+ 
+ 
+ 
+
+ 
+ Number
+ issued and outstanding after this offering 
+ 
+ 23,402,500
+ Class A ordinary shares3,4
+
+ 
+
+ 
+
+ 
+
+1 Assumes
+no exercise of the underwriters over-allotment option..
+
+2
+Consists solely of founder shares and includes up to 693,750 Class B ordinary shares that are subject to forfeiture
+by our sponsor depending on the extent to which the underwriters over-allotment option is exercised. Except as otherwise specified,
+the rest of this prospectus has been drafted to give effect to the full forfeiture of these 693,750 Class B ordinary shares.
+
+3 Includes
+18,500,000 public shares, 277,500 representative shares and 4,625,000 founder shares.
+
+4
+Founder shares are classified as Class B ordinary shares, which shares will convert into Class A ordinary shares
+on a one-for-one basis, subject to adjustment as described below adjacent to the caption "Founder shares conversion and anti-dilution."
+
+ 
+
+ 9
+
+ 
+
+ 
+
+ 
+
+ 
+ Rights:
+ 
+ 
+ 
+
+ 
+ Number issued and outstanding
+ before this offering 
+ 
+ 0
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Number issued and outstanding
+ after this offering 
+ 
+ 18,500,000 rights1
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Redeemable Warrants:
+ 
+ 
+ 
+
+ 
+ Number of issued and
+ outstanding before this offering
+ 
+ 0
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Number of warrants to
+ be outstanding after this offering and the private placement
+ 
+ 17,700,0005
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Exercisability
+ 
+ Each unit contains one-half of one redeemable
+ warrant. Each whole warrant is exercisable to purchase one of our Class A ordinary shares. Pursuant to the warrant agreement,
+ a warrant holder may exercise its warrants only for a whole number of shares.
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Exercise price
+ 
+ $11.50 per
+ share, subject to adjustment as described herein. In addition, if (x) we issue additional
+ ordinary shares or equity-linked securities at an issue price or effective issue price of
+ less than $9.20 per share (with such issue price or effective issue price to be determined
+ in good faith by our Board of Directors and, in the case of any such issuance to our initial
+ shareholders or their affiliates, without taking into account any founder shares held by
+ such shareholders or their affiliates, as applicable, prior to such issuance (the "Newly
+ Issued Price")), (y) the aggregate gross proceeds from such issuances represent
+ more than 60% of the total equity proceeds, and interest thereon, available for funding our
+ initial business combination (net of redemptions), and (z) the volume weighted average
+ trading price of our ordinary shares during the 20 trading day period starting on the trading
+ day prior to the day on which we consummate our business combination (such price, the "Market
+ Value") is below $9.20 per share, the exercise price shall be adjusted (to the nearest
+ cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and
+ the $16.50 per share redemption trigger price described in the section "Redemption
+ of warrants" will be adjusted (to the nearest cent) to be equal to 165% of the higher
+ of the Market Value and the Newly Issued Price.
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Exercise period
+ 
+ The warrants will become exercisable on the later of:
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ after the completion of our initial business combination, or
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 12 months from the date of this prospectus;
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ provided in each case that we have an effective
+ registration statement under the Securities Act covering the Class A ordinary shares issuable upon exercise of the warrants
+ and a current prospectus relating to them is available (or we permit holders to exercise their warrants on a cashless basis under
+ the circumstances specified in the warrant agreement).
+ 
+
+ 
+ 
+
+5
+Includes 9,250,000 redeemable warrants included as part of units and 8,450,000 private placement warrants.
+
+ 
+
+ 10
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ We are not registering the Class A
+ ordinary shares issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable after the
+ closing of our initial business combination, we will use our best efforts to file, and within 60 business days following our initial
+ business combination to have declared effective, a registration statement covering the Class A ordinary shares issuable upon
+ exercise of the warrants, and to maintain a current prospectus relating to those Class A ordinary shares until the warrants
+ expire or are redeemed, as specified in the warrant agreement. No warrants will be exercisable for cash unless we have an effective
+ and current registration statement covering the Class A ordinary shares issuable upon exercise of the warrants and a current
+ prospectus relating to such Class A ordinary shares. Notwithstanding the foregoing, if a registration statement covering the
+ Class A ordinary shares issuable upon exercise of the warrants is not effective by the 60th day after the consummation
+ of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during
+ any period when we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant
+ to the exemption provided by Section 3(a)(9) of the Securities Act of 1933, as amended, or the Securities Act, provided
+ that such exemption is available. If that exemption, or another exemption, is not available, holders will not be able to exercise
+ their warrants on a cashless basis. In the event that holders are able to exercise their warrants on a "cashless basis,"
+ each holder would pay the exercise price by surrendering the warrants for that number of shares of Class A ordinary share equal to
+ the quotient obtained by dividing (x) the product of the number of shares of Class A ordinary share underlying the warrants, multiplied
+ by the difference between the exercise price of the warrants and the "fair market value" (defined below) by (y) the fair
+ market value. The "fair market value" shall mean the average last reported sale price of the Class A ordinary share for
+ the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of
+ warrants.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The warrants will expire at 5:00 p.m., New York City time, five years
+ after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant,
+ the warrant exercise price will be paid directly to us and not placed in the trust account.
+
+ 
+ 
+ 
+ 
+
+ 
+ Redemption of warrants
+ 
+ Once the warrants become exercisable, we may redeem the outstanding
+ warrants (except as described herein with respect to the private placement warrants):
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ in whole and not in part;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ at a price of $0.01 per warrant;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ upon a minimum of 30 days prior written notice
+ of redemption, which we refer to as the 30-day redemption period; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ if, and only if, the last sale price of our Class A ordinary
+ shares equals or exceeds $16.50 per share (as adjusted for share splits, share capitalizations, rights issuances, subdivisions, reorganizations,
+ recapitalizations and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the
+ date on which we send the notice of redemption to the warrant holders.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We will not redeem the warrants unless a registration statement under
+ the Securities Act covering the Class A ordinary shares issuable upon exercise of the warrants is effective and a current prospectus
+ relating to those ordinary shares is available throughout the 30-day redemption period, except if the warrants may be exercised on
+ a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become
+ redeemable by us, we may not exercise our redemption right if the issuance of shares upon exercise of the warrants is not exempt
+ from registration or qualification under applicable state blue sky laws or we are unable to effect such registration or qualification.
+ We will use our best efforts to register or qualify such ordinary shares under the blue sky laws of the state of residence in those
+ states in which the warrants were offered by us in this offering.
+
+ 
+ 
+ 
+
+ 
+ 
+ If we call the warrants for redemption as described above,
+ our management will have the option to require all holders that wish to exercise warrants to do so on a "cashless basis."
+ In determining whether to require all holders to exercise their warrants on a "cashless basis," our management will consider,
+ among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our shareholders of
+ issuing the maximum number of Class A ordinary shares issuable upon the exercise of our warrants. In such event, each holder
+ would pay the exercise price by surrendering the warrants for that number of Class A ordinary shares equal to the quotient obtained
+ by dividing (x) the product of the number of Class A ordinary shares underlying the warrants, multiplied by the excess
+ of the "fair market value" (defined below) over the exercise price of the warrants by (y) the fair market value.
+ The "fair market value" shall mean the average reported last sale price of the Class A ordinary shares for the 10
+ trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants.
+ Please see the section entitled "Description of Securities Redeemable Warrants Public Shareholders Warrants"
+ for additional information.
+
+ 
+
+ 11
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ Terms of Rights
+ 
+ Except in cases where we are not the surviving company
+ in a business combination, each holder of a right will automatically receive one-tenth (1/10) of one Class A ordinary share
+ upon consummation of our initial business combination. We will not issue fractional shares in connection with an exchange of rights.
+ Fractional shares will either be rounded down to the nearest whole share or otherwise addressed in accordance with the applicable
+ provisions of British Virgin Islands law. As a result, you must hold whole rights in multiples of 10 in order to receive shares for
+ all of your rights upon closing of a business combination. In the event we will not be the surviving company upon completion of our
+ initial business combination, each holder of a right will be required to affirmatively convert his, her or its rights in order to
+ receive the one-tenth (1/10) of one Class A ordinary share underlying each right upon consummation of the business combination.
+ If we are unable to complete an initial business combination within the required time period and we redeem the public shares for
+ the funds held in the trust account, holders of rights will not receive any of such funds for their rights and the rights will expire
+ worthless.
+
+ 
+ 
+
+ 
+ Election of directors; voting rights
+ 
+ Prior to our initial business combination, only holders
+ of our Class B ordinary shares will have the right to vote on the election of directors. Holders of our public shares will not be
+ entitled to vote on the election of directors during such time. These provisions of our amended and restated memorandum and articles
+ of association with class rights may not be amended without a resolution passed by holders of at least a majority of the total number
+ of ordinary shares of that class that have voted and are entitled to vote thereon. With respect to any other matter submitted to
+ a vote of our shareholders, including any vote in connection with our initial business combination, except as required by law, holders
+ of our founder shares and holders of our public shares will vote together as a single class, with each share entitling the holder
+ to one vote.
+
+ 
+ 
+
+ 
+ Founder shares
+ 
+ On June 28, 2021 we
+ issued to our sponsor 5,750,000 founder shares for an aggregate purchase price of $25,000,
+ or approximately $0.004 per share. On March 24, 2022, we canceled
+ 431,250 of such founder shares for no consideration, resulting in 5,318,750 founder shares
+ remaining outstanding. Prior to the initial investment in the company of $25,000 by
+ our sponsor, the company had no assets, tangible or intangible. The purchase price of the
+ founder shares was determined by dividing the amount of cash contributed to us by the number
+ of founder shares issued. Our sponsor will own 20% of our issued and outstanding shares after
+ this offering (assuming it does not purchase units in this offering and excluding the Representative s
+ shares). If we increase or decrease the size of the offering, we will effect a capitalization
+ or share surrender or redemption or other appropriate mechanism, as applicable, with respect
+ to our founder shares immediately prior to the consummation of the offering in such amount
+ as to maintain the ownership of founder shares by our sponsor at 20% of our issued and outstanding
+ ordinary shares upon the consummation of this offering (excluding the Representative s
+ shares). Up to 693,750 founder shares are subject to forfeiture by our sponsor depending
+ on the extent to which the underwriters over-allotment option is exercised.
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The founder shares are identical to the Class A ordinary shares
+ included in the units being sold in this offering, except that:
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ only holders of our
+ Class B ordinary shares will have the right to vote on the election of directors prior to our initial business combination
+ and the holders of our Class A ordinary shares will not be entitled to vote on the election of directors during such time;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the founder shares are subject to certain
+ transfer restrictions, as described in more detail below;
+
+ 
+
+ 
+
+ 12
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ 
+ our sponsor, officers and directors have entered into a letter agreement with us, pursuant
+ to which they have agreed (i) to waive their redemption rights with respect to their
+ founder shares and public shares in connection with the completion of our initial business
+ combination and (ii) to waive their rights to liquidating distributions from the trust
+ account with respect to their founder shares if we fail to complete our initial business
+ combination within 15 months from the closing of this offering (or up to 21 months from the
+ closing of this offering if we extend the period of time to consummate a business combination
+ by the full amount of time) (although they will be entitled to liquidating distributions
+ from the trust account with respect to any public shares they hold if we fail to complete
+ our initial business combination within the prescribed time frame). If we submit our initial
+ business combination to our public shareholders for a vote, our insiders have agreed, pursuant
+ to such letter agreement, to vote their founder shares and any public shares purchased
+ during or after this offering in favor of our initial business combination. As a result,
+ in addition to our initial shareholder s founder shares, we would need only 6,798,751
+ or 37%, of the 18,500,000 public shares sold in this offering to be voted in favor of a transaction
+ (assuming all outstanding shares are voted and all shares to be issued to Maxim and/or its
+ designees are issued and outstanding and voted in favor of the business combination) or 948,126
+ or 5%, of the 18,500,000 public shares sold in this offering to be voted in favor of a transaction
+ (assuming only a quorum is present at such meeting held to vote on our initial business combination
+ and all shares to be issued to Maxim and/or its designees are issued and outstanding and
+ voted in favor of the business combination) in order to have our initial business combination
+ approved (assuming the over-allotment option is not exercised); 
+
+ 
+ 
+
+ 
+ 
+ 
+ the founder shares will automatically
+ convert into our Class A ordinary shares at the time of our initial business combination, or earlier at the option of the holder,
+ on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described in more detail below and in
+ our amended and restated memorandum and articles of association; and
+
+ 
+ 
+
+ 
+ 
+ 
+ the founder shares are subject to registration
+ rights.
+
+ 
+ 
+ 
+ 
+
+ 
+ Representative Shares
+ 
+ We have
+ agreed to issue to Maxim Partners LLC and/or its designees, 277,500 ordinary shares (or 319,125
+ shares if the underwriter s over-allotment option is exercised in full) upon the consummation
+ of this offering. Maxim has agreed not to transfer, assign or sell any such shares until the completion
+ of our initial business combination. In addition, Maxim has agreed (i) to waive its redemption
+ rights with respect to such shares in connection with the completion of our initial business combination
+ and (ii) to waive its rights to liquidating distributions from the trust account with respect
+ to such shares if we fail to complete our initial business combination within 15 months from the
+ closing of this offering (or up to 21 months from the closing of this offering if we extend the
+ period of time to consummate a business combination, as described in more detail in this prospectus).
+
+ 
+
+ The shares have been deemed compensation
+ by FINRA and are therefore subject to a lock-up for a period of 180 days immediately following the date of the commencement of sales
+ in this offering pursuant to FINRA Rule 5110(e)(1). Pursuant to FINRA Rule 5110(e)(1), these securities will not be the
+ subject of any hedging, short sale, derivative, put or call transaction that would result in the economic disposition of the securities
+ by any person for a period of 180 days immediately following the effective date of the registration statement of which this prospectus
+ forms a part, nor may they be sold, transferred, assigned, pledged or hypothecated for a period of 180 days immediately following
+ the effective date of the registration statement of which this prospectus forms a part except to any underwriter and selected dealer
+ participating in the offering and their officers, partners, registered persons or affiliates.
+
+ 
+
+ 
+
+ 
+ Transfer restrictions
+ on founder 
+
+ shares
+ 
+ Our sponsor has agreed not to transfer,
+ assign or sell any of its founder shares until the earlier to occur of: (A) six months after the completion of our initial business
+ combination or (B) the date on which we complete a liquidation, merger, share exchange, reorganization or other similar transaction
+ after our initial business combination that results in all of our public shareholders having the right to exchange their ordinary
+ shares for cash, securities or other property (except as described herein under "Principal Shareholders Transfers of
+ Founder Shares and Private Placement Warrants"). We refer to such transfer restrictions throughout this prospectus as the lock-up.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Notwithstanding the foregoing, if the last sale price of our ordinary
+ shares equals or exceeds $12.00 per share (as adjusted for share splits, share capitalizations, rights issuances, subdivisions, reorganizations,
+ recapitalizations and the like) for any 20 trading days within any 30-trading day period, the founder shares will be released from
+ the lock-up.
+
+ 
+ 
+ 
+ 
+
+ 
+ Founder shares conversion 
+
+ and anti-dilution rights
+ 
+ We have issued 5,318,750 Class B ordinary shares, with no par
+ value to our sponsor. The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of
+ our initial business combination, on a one-for-one basis, subject to adjustment for share splits, share capitalizations, reorganizations,
+ recapitalizations and the like, and subject to further adjustment as provided herein and in our amended and restated memorandum and
+ articles of association.
+
+ 
+ 
+
+ 13
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ In the case that additional Class A ordinary shares,
+ or equity-linked securities, are issued or deemed issued in excess of the amounts sold in this offering and related to the closing
+ of our initial business combination, the ratio at which the Class B ordinary shares shall convert into Class A ordinary
+ shares will be adjusted (unless the holders of a majority of the issued and outstanding Class B ordinary shares agree to waive
+ such anti-dilution adjustment with respect to any such issuance or deemed issuance) so that the number of Class A ordinary shares
+ issuable upon conversion of all Class B ordinary shares will equal, in the aggregate, 20% of the sum of all ordinary shares
+ outstanding upon completion of this offering plus all Class A ordinary shares and equity-linked securities issued or deemed
+ issued in connection with our initial business combination, excluding any shares or equity-linked securities issued, or to be issued,
+ to any seller in our initial business combination or any private placement-equivalent securities issued to our sponsor or its affiliates
+ upon conversion of loans made to us. Holders of founder shares may also elect to convert their Class B ordinary shares into
+ an equal number of Class A ordinary shares, subject to adjustment as provided above, at any time. The term "equity-linked
+ securities" refers to any debt or equity securities that are convertible, exercisable or exchangeable for our Class A
+ ordinary shares issued in a financing transaction in connection with our initial business combination, including but not limited
+ to a private placement of equity or debt. Securities could be "deemed issued" for purposes of the conversion adjustment
+ if such shares are issuable upon the conversion or exercise of convertible securities, warrants or similar securities.
+
+ 
+ 
+
+ 
+ Private placement warrants
+ 
+ Our sponsor has agreed
+ to purchase an aggregate of 8,450,000 warrants (or 9,421,250 warrants if the over-allotment
+ option is exercised in full) at a price of $1.00 per warrants for an aggregate purchase price
+ of $8,450,000, or $9,421,250 if the over-allotment option is exercised in full. The private
+ placement warrant are identical to the warrants sold as part of the units in this offering,
+ except that, (i) they will not be redeemable by us, (ii) they may be transferred, assigned
+ or sold by the Sponsor to the Permitted Transferees and (iii) they may be exercised by the
+ holders on a cashless basis. The private placement warrants will be sold in a private placement
+ that will close simultaneously with the closing of this offering, including the over-allotment
+ option, as applicable. There will be no redemption rights or liquidating distributions from
+ the trust account with respect to the founder shares or private placement warrants. The warrants
+ will expire worthless if we do not consummate a business combination within the allotted
+ 15-month period (or up to 21 months from the completion of this offering if we extend the
+ period of time to consummate a business combination by the full amount of time).
+
+ 
+ 
+ 
+ 
+
+ 
+ Transfer restrictions on private
+
+ placement warrants
+ 
+ The private placement warrants will not be transferable, assignable or salable except for transfers
+ (i) among the initial shareholders or to the initial shareholder s members or the company s officers, directors, consultants
+ or their affiliates, (ii) to a holder s shareholders or members upon the holder s liquidation, in each case if the holder
+ is an entity, (iii) by bona fide gift to a member of the holder s immediate family or to a trust, the beneficiary of which
+ is the holder or a member of the holder s immediate family, in each case for estate planning purposes, (iv) by virtue of the
+ laws of descent and distribution upon death, (v) pursuant to a qualified domestic relations order, (vi) to the company for no value
+ for cancellation in connection with the consummation of a business combination, (vii) in the event of the company s liquidation
+ prior to its consummation of an initial business combination or (viii) in the event that, subsequent to the consummation of an initial
+ business combination, the company completes a liquidation, merger, share exchange, reorganization or other similar transaction which
+ results in all of the company s shareholders having the right to exchange their ordinary shares for cash, securities or other
+ property, in each case (except for clauses (vi), (vii) or (viii) or with the company s prior written consent) on the condition
+ that prior to such registration for transfer, the Warrant Agent shall be presented with written documentation pursuant to which each
+ permitted transferee or the trustee or legal guardian for such permitted transferee agrees to be bound by the transfer restrictions
+ contained in the warrant agreement and any other applicable agreement the transferor is bound by.
+
+ 
+ 
+
+ 14
+
+ 
+
+ 
+
+ 
+
+ 
+ Redeemability and exercise of 
+
+ private placement warrants
+ 
+ The private placement warrants will be non-redeemable and
+ exercisable on a cashless basis so long as they are held by our sponsor or its permitted transferees. If the private placement warrants
+ are held by someone other than our sponsor or its permitted transferees, the placement warrants will be redeemable by us and exercisable
+ by such holders on the same basis as the warrants included in the units being sold in this offering. If holders of private placement
+ warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering their warrants for that number
+ of Class A ordinary shares equal to the quotient obtained by dividing (x) the product of the number of Class A ordinary
+ shares underlying the warrants, multiplied by the difference between the exercise price of the warrants and the "fair market
+ value" (defined below) by (y) the fair market value. The "fair market value" shall mean the average reported
+ last sale price of the Class A ordinary shares for the 10 trading days ending on the third trading day prior to the date on
+ which the notice of warrant exercise is sent to the warrant agent. The reason that we have agreed that these warrants will be exercisable
+ on a cashless basis so long as they are held by the sponsor or its permitted transferees is because it is not known at this time
+ whether they will be affiliated with us following an initial business combination. If they remain affiliated with us, their ability
+ to sell our securities in the open market will be significantly limited. We expect to have policies in place that prohibit insiders
+ from selling our securities except during specific periods of time. Even during such periods of time when insiders will be permitted
+ to sell our securities, an insider cannot trade in our securities if he or she is in possession of material non-public information.
+ Accordingly, unlike public shareholders who could sell the Class A ordinary shares issuable upon exercise of the warrants freely
+ in the open market, the insiders could be significantly restricted from doing so. As a result, we believe that allowing the holders
+ to exercise such warrants on a cashless basis is appropriate.
+
+ 
+ 
+
+ 
+ Proceeds to be held in trust account
+ 
+ The rules of
+ NASDAQ provide that at least 90% of the gross proceeds from this offering and the private
+ placement be deposited in a trust account. Of the net proceeds we will receive from this
+ offering and the sale of the private placement warrants described in this prospectus, $188,237,500
+ ($10.175 per unit), or $216,473,125 ($10.175 per unit) if the underwriters over-allotment
+ option is exercised in full (subject to increase of up to an additional $0.20 per unit in
+ the event that our sponsor elects to extend the period of time to consummate a business combination,
+ as described in more detail in this prospectus), will be deposited into a segregated trust
+ account located in the United States with Continental Stock Transfer & Trust Company
+ acting as trustee and $1,975,000 will be used to pay expenses in connection with the closing
+ of this offering and for working capital following this offering. The proceeds to be placed
+ in the trust account include $6,475,000 (or up to $7,446,250 if the underwriters over-allotment
+ option is exercised in full) in deferred underwriting commissions.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The funds in the trust account will be invested only in specified U.S.
+ government treasury bills or in specified money market funds.
+
+ 
+ 
+
+ 
+ 
+ 
+ Except with respect to interest earned on the funds held
+ in the trust account that may be released to us to pay our taxes, if any, the proceeds from this offering and the private placement
+ will not be released from the trust account until the earliest of (i) the completion of our initial business combination, (ii) the
+ redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum
+ and articles of association to (A) modify the substance or timing of our obligation to redeem 100% of our public shares if we
+ do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months from the
+ closing of this offering if we extend the period of time to consummate a business combination by the full amount of time) or (B) with
+ respect to any other provision relating to shareholders rights or pre-business combination activity and (iii) the redemption
+ of all of our public shares if we are unable to complete our initial business combination within 15 months from the closing of this
+ offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination
+ by the full amount of time), subject to applicable law. The proceeds deposited in the trust account could become subject to the claims
+ of our creditors, if any, which could have priority over the claims of our public shareholders.
+
+ 
+ 
+
+ 15
+
+ 
+
+ 
+
+ 
+
+ 
+ Ability to extend time to 
+
+ complete business 
+
+ combination
+ 
+ We will have until
+ 15 months from the closing of this offering to consummate an initial business combination. However, if we
+ anticipate that we may not be able to consummate our initial business combination within 15 months, we may
+ extend the period of time to consummate a business combination up to two times, each by an additional three
+ months (for a total of up to 21 months to complete a business combination). Pursuant to the terms of our amended
+ and restated memorandum and articles of association and the trust agreement to be entered into between us
+ and Continental Stock Transfer & Trust Company on the date of this prospectus, in order to extend
+ the time available for us to consummate our initial business combination, our sponsor or its affiliates or
+ designees, upon ten days advance notice prior to the applicable deadline, must deposit into the trust account
+ $1,850,000, or up to $2,127,500 if the underwriters over-allotment option is exercised in full ($0.10 per
+ share in either case) on or prior to the date of the applicable deadline, for each three month extension (or
+ up to an aggregate of $3,700,000 (or $4,255,000 if the underwriters over-allotment option is exercised in
+ full), or $0.20 per share if we extend for the full six months). Any such payments would be made in the form
+ of a loan. Any such loans will be non-interest bearing and payable upon the consummation of our initial business
+ combination. If we complete our initial business combination, we would repay such loaned amounts out of the
+ proceeds of the trust account released to us. If we do not complete a business combination, we will not repay
+ such loans. Furthermore, the letter agreement with our initial shareholder contains a provision pursuant to
+ which our sponsor has agreed to waive its right to be repaid for such loans out of the funds held in the trust
+ account in the event that we do not complete a business combination. Our sponsor and its affiliates or designees
+ are not obligated to fund the trust account to extend the time for us to complete our initial business combination.
+
+ 
+ 
+
+ 
+ Anticipated expenses and funding sources
+ 
+ Unless and until we complete our initial business combination, no proceeds held in the
+ trust account will be available for our use, except the withdrawal of interest to pay taxes. Based upon current interest rates, we
+ expect the trust account to generate approximately $188,000 of interest annually (assuming no exercise of the underwriters 
+ over-allotment option and an interest rate of 0.1% per year) following the investment of such funds in specified U.S. government
+ treasury bills or in specified money market funds. Unless and until we complete our initial business combination, we may pay our
+ expenses only from:
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ net proceeds of this offering and the sale of the private placement warrants not held in
+ the trust account, which will be approximately $1,350,000 in working capital after the payment
+ of approximately $736,000 (not including underwriter s commissions) in expenses relating
+ to this offering; and
+
+ 
+ 
+
+ 
+ 
+ 
+ any loans or additional investments
+ from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation
+ to advance funds or invest in us, and provided any such loans will not have any claim on the proceeds held in the trust account unless
+ such proceeds are released to us upon completion of a business combination. Up to $1,150,000 of such loans may be convertible into
+ warrants at a price of $1.00 per warrant at the option of the lender.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ Conditions to completing our initial
+ business combination
+ 
+ There is no limitation on our ability to raise funds privately
+ or through loans in connection with our initial business combination. NASDAQ rules require that our initial business combination
+ must be with one or more target businesses that together have an aggregate fair market value equal to at least 80% of the balance
+ in the trust account (less any deferred underwriting commissions and any taxes payable on interest earned) at the time of our signing
+ a definitive agreement in connection with our initial business combination. We do not intend to purchase multiple businesses in unrelated
+ industries in conjunction with our initial business combination.
+
+ 
+ 
+
+ 
+ 
+ 
+ If our Board of Directors is not able to independently
+ determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking
+ firm or another independent firm that commonly renders valuation opinions or an independent accounting firm. We will complete our
+ initial business combination only if the post-transaction company in which our public shareholders own shares will own or acquire
+ 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient
+ for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company
+ owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may
+ collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our
+ initial business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses
+ are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what
+ will be valued for purposes of the 80% of net assets test, provided that in the event that our initial business combination involves
+ more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses.
+
+ 
+ 
+
+ 16
+
+ 
+
+ 
+
+ 
+
+ 
+ Permitted purchases of public shares
+ by our affiliates
+ 
+ If we seek shareholder approval of our initial business
+ combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules,
+ our sponsor, directors, officers, advisors or their affiliates may purchase shares or warrants in privately negotiated transactions
+ or in the open market either prior to or following the completion of our initial business combination. Please see "Proposed
+ Business Permitted purchases of our securities" for a description of how such persons will determine which shareholders
+ to seek to acquire shares from. There is no limit on the number of shares such persons may purchase, or any restriction on the price
+ that they may pay. Any such price per share may be different than the amount per share a public shareholder would receive if it elected
+ to redeem its shares in connection with our initial business combination. However, such persons have no current commitments, plans
+ or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. In the
+ event our sponsor, directors, officers, advisors or their affiliates determine to make any such purchases at the time of a shareholder
+ vote relating to our initial business combination, such purchases could have the effect of influencing the vote necessary to approve
+ such transaction. None of the funds in the trust account will be used to purchase shares in such transactions. If they engage in
+ such transactions, they will not make any such purchases when they are in possession of any material non-public information not disclosed
+ to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. Subsequent to the consummation of this
+ offering, we will adopt an insider trading policy which will require insiders to: (i) refrain from purchasing shares during
+ certain blackout periods and when they are in possession of any material non-public information and (ii) to clear all trades
+ with our legal counsel prior to execution. We cannot currently determine whether our insiders will make such purchases pursuant to
+ a Rule 10b5-1 plan, as it will be dependent upon several factors, including but not limited to, the timing and size of such
+ purchases. Depending on such circumstances, our insiders may either make such purchases pursuant to a Rule 10b5-1 plan or determine
+ that such a plan is not necessary.
+
+ 
+ 
+ 
+ 
+
+ 
+
+ 
+ 
+ 
+ We do not currently anticipate that such purchases, if
+ any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction
+ subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases
+ that the purchases are subject to such rules, the purchasers will comply with such rules. Our sponsor, directors, officers, advisors
+ or their affiliates will not make any purchases if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the
+ Exchange Act.
+
+ 
+
+ 
+
+ 
+ Redemption rights for public shareholders
+ upon completion of our initial business combination
+ 
+ We will provide our public shareholders with the opportunity
+ to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable
+ in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of
+ our initial business combination, including interest (which interest shall be net of taxes payable) divided by the number of then
+ outstanding public shares, subject to the limitations described herein.
+
+ 
+ 
+
+ 
+ 
+ 
+ The amount in the trust account is initially anticipated
+ to be $10.175 per public share (subject to increase of up to an additional $0.20 per unit in the event that our sponsor elects
+ to extend the period of time to consummate a business combination, as described in more detail in this prospectus). The per-share
+ amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions
+ we will pay to the underwriters. There will be no redemption rights upon the completion of our initial business combination with
+ respect to our public warrants, public rights or private placement warrants. Our sponsor, officers and directors have entered into
+ a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares
+ and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination.
+
+ 
+ 
+ 
+ 
+
+ 
+ Manner of conducting redemptions
+ 
+ We will provide our public shareholders with the opportunity to redeem
+ all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with
+ a shareholder meeting called to approve the business combination or (ii) by means of a tender offer. The decision as to whether
+ we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our
+ discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction
+ would require us to seek shareholder approval under the law or stock exchange listing requirement. Under NASDAQ rules, asset acquisitions
+ and stock purchases would not typically require shareholder approval while direct mergers with our company where we do not survive
+ and any transactions where we issue more than 20% of our issued and outstanding ordinary shares or seek to amend our amended and
+ restated memorandum and articles of association would require shareholder approval. We intend to conduct redemptions without a shareholder
+ vote pursuant to the tender offer rules of the SEC unless shareholder approval is required by law or stock exchange listing
+ requirement or we choose to seek shareholder approval for business or other legal reasons. So long as we obtain and maintain a listing
+ for our securities on NASDAQ, we will be required to comply with such rules.
+
+ 
+ 
+
+ 17
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ If a shareholder vote is not required and we do not decide
+ to hold a shareholder vote for business or other legal reasons, we will, pursuant to our amended and restated memorandum and articles
+ of association:
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ conduct the redemptions pursuant
+ to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and
+
+ 
+ 
+
+ 
+ 
+ 
+ file tender offer documents
+ with the SEC prior to completing our initial business combination which contain substantially the same financial and other information
+ about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates
+ the solicitation of proxies.
+
+ 
+ 
+
+ 
+ 
+ 
+ Upon the public announcement of our initial business combination,
+ if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance
+ with Rule 10b5-1 to purchase our Class A ordinary shares in the open market, in order to comply with Rule 14e-5 under
+ the Exchange Act.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ In the event we conduct redemptions pursuant to the tender
+ offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under
+ the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer
+ period. In addition, the tender offer will be conditioned on public shareholders not tendering more than a specified number of public
+ shares, which number will be based on the requirement that we may not redeem public shares in an amount that would cause our net
+ tangible assets to be less than $5,000,001 upon consummation of our initial business combination, after payment of the deferred underwriting
+ commission (so that we are not subject to the SEC s "penny stock" rules) or any greater net tangible asset or cash
+ requirement which may be contained in the agreement relating to our initial business combination. If public shareholders tender more
+ shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination.
+
+ 
+ 
+
+ 
+ 
+ 
+ If, however, shareholder approval of the transaction is
+ required by law or stock exchange listing requirement, or we decide to obtain shareholder approval for business or other legal reasons,
+ we will:
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ conduct the redemptions in conjunction
+ with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant
+ to the tender offer rules; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ file proxy materials with the SEC.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We expect that a final proxy statement would be mailed to public shareholders
+ at least 10 days prior to the shareholder vote. However, we expect that a draft proxy statement would be made available to such shareholders
+ well in advance of such time, providing additional notice of redemption if we conduct redemptions in conjunction with a proxy solicitation.
+ Although we are not required to do so, we currently intend to comply with the substantive and procedural requirements of Regulation
+ 14A in connection with any shareholder vote even if we are not able to maintain our NASDAQ listing or Exchange Act registration.
+
+ 
+ 
+
+ 18
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ If we seek shareholder
+ approval, we will complete our initial business combination only if a majority of the issued
+ and outstanding ordinary shares voted are voted in favor of the business combination. In
+ such case, pursuant to the terms of a letter agreement entered into with us, our sponsor,
+ officers and directors have agreed (and their permitted transferees will agree) to vote any
+ founder shares held by them and any public shares purchased during or after this offering
+ in favor of our initial business combination. We expect that at the time of any shareholder
+ vote relating to our initial business combination, our sponsor, Maxim and their permitted
+ transferees will own at least 20% of our issued and outstanding ordinary shares entitled
+ to vote thereon. If we submit our initial business combination to our public shareholders
+ for a vote, our insiders and Maxim have agreed, pursuant to such letter agreement, to vote
+ their founder shares, Representative Shares and any public shares purchased during or
+ after this offering in favor of our initial business combination (as a result, in addition
+ to our initial shareholder s founder shares, we would need only 6,798,751 or 37%, of
+ the 18,500,000 public shares sold in this offering to be voted in favor of a transaction
+ (assuming all outstanding shares are voted and all shares to be issued to Maxim and/or
+ its designees are issued and outstanding and voted in favor of the business combination)
+ or 948,126 or 5%, of the 18,500,000 public shares sold in this offering to be voted in favor
+ of a transaction (assuming only a quorum is present at such meeting held to vote on our initial
+ business combination and all shares to be issued to Maxim and/or its designees are issued
+ and outstanding and voted in favor of the business combination) in order to have our initial
+ business combination approved (assuming the over-allotment option is not exercised)). Each
+ public shareholder may elect to redeem their public shares irrespective of whether they vote
+ for or against the proposed transaction.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Our amended and restated memorandum and articles of association
+ will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than
+ $5,000,001 upon consummation of our initial business combination (so that we are not subject to the SEC s "penny stock"
+ rules). Redemptions of our public shares may also be subject to a higher net tangible asset test or cash requirement pursuant to
+ an agreement relating to our initial business combination. For example, the proposed business combination may require: (i) cash
+ consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other
+ general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed
+ business combination. In the event the aggregate cash consideration we would be required to pay for all ordinary shares that are
+ validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business
+ combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares,
+ and all ordinary shares submitted for redemption will be returned to the holders thereof.
+
+ 
+ 
+
+ 
+ Tendering share certificates
+
+ in connection with a tender
+
+ offer or redemption rights
+
+ 
+ We may require our public shareholders seeking to exercise
+ their redemption rights, whether they are record holders or hold their shares in "street name," to either tender their
+ certificates (if any) to our transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to
+ such holders, or up to two business days prior to the vote on the proposal to approve our initial business combination in the event
+ we distribute proxy materials, or to deliver their shares to the transfer agent electronically using The Depository Trust Company s
+ DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option, rather than simply voting against the initial business
+ combination. The tender offer or proxy materials, as applicable, that we will furnish to holders of our public shares in connection
+ with our initial business combination will indicate whether we are requiring public shareholders to satisfy such delivery requirements.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ Limitation on redemption
+ rights of shareholders holding more than 15% of the shares sold in this offering if we hold shareholder vote
+ 
+ Notwithstanding the foregoing redemption rights, if we
+ seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
+ combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that
+ a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in
+ concert or as a "group" (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its
+ shares with respect to more than an aggregate of 15% of the shares sold in this offering. We believe the restriction described above
+ will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability
+ to redeem their shares as a means to force us or our sponsor or its affiliates to purchase their shares at a significant premium
+ to the then-current market price or on other undesirable terms. Absent this provision, a public shareholder holding more than an
+ aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination
+ if such holder s shares are not purchased by us or our sponsor or its affiliates at a premium to the then-current market price
+ or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this
+ offering, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our ability to complete
+ our initial business combination, particularly in connection with a business combination with a target that requires as a closing
+ condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders 
+ ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in
+ this offering) for or against our initial business combination. Our sponsor, officers and directors have, pursuant to a letter agreement
+ entered into with us, waived their right to have any founder shares or public shares held by them redeemed in connection with our
+ initial business combination. Unless any of our other affiliates acquires founder shares through a permitted transfer from an initial
+ shareholder, and thereby becomes subject to the letter agreement, no such affiliate is subject to this waiver. However, to the extent
+ any such affiliate acquires public shares in this offering or thereafter through open market purchases, it would be a public shareholder
+ and subject to the 15% limitation in connection with any such redemption right.
+
+ 
+ 
+
+ 19
+
+ 
+
+ 
+
+ 
+
+ 
+ Redemption Rights
+ in connection with proposed amendments to our amended and restated memorandum and articles of association
+ 
+ Our amended and restated memorandum and articles of association
+ will provide that any of its provisions, including those related to pre-business combination activity (including the requirement
+ to deposit proceeds of this offering and the private placement into the trust account and not release such amounts except in specified
+ circumstances, and to provide redemption rights to public shareholders as described herein and in our amended and restated memorandum
+ and articles of association, but excluding the provision of the articles relating to the appointment of directors), may be amended
+ if approved by a resolution by holders of at least a majority of our ordinary shares who are eligible to vote and attend and vote
+ in a general meeting, and corresponding provisions of the trust agreement governing the release of funds from our trust account may
+ be amended if approved by holders of a majority of our ordinary shares. Should our insiders vote all their shares in favor of any
+ such amendment, such amendment would not be approved regardless how public shares are voted. We may not issue additional securities
+ that can vote on amendments to our amended and restated memorandum and articles of association or in our initial business combination.
+ Our sponsor, which will beneficially own 20% of our ordinary shares upon the closing of this offering (assuming it does not purchase
+ units in this offering and excluding the Representative Shares), will participate in any vote to amend our amended and restated memorandum
+ and articles of association and/or trust agreement and will have the discretion to vote in any manner it chooses. Our sponsor, officers,
+ and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated
+ memorandum and articles of association that would (i) modify the substance or timing of our obligation to redeem 100% of our
+ public shares if we do not complete our initial business combination within 15 months from the closing of this offering (or
+ up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination by the full
+ amount of time) or (ii) with respect to the other provisions relating to shareholders rights or pre-business combination
+ activity, unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval
+ of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account,
+ including interest (which interest shall be net of taxes payable) divided by the number of then outstanding public shares. Our sponsor,
+ officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption
+ rights with respect to their founder shares and public shares in connection with the completion of our initial business combination.
+
+ 
+ 
+
+ 
+ Release of funds
+ in trust account on closing of our initial business combination
+ 
+ On the completion of our initial business combination,
+ all amounts held in the trust account will be released to us, other than funds the trustee will use to pay amounts due to any public
+ shareholders who exercise their redemption rights as described above under "Redemption rights for public shareholders upon
+ completion of our initial business combination." We will use the remaining funds to pay the underwriters their deferred underwriting
+ commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination
+ and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using
+ equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection
+ with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate
+ purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest
+ due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working
+ capital.
+
+ 
+ 
+
+ 20
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ Redemption
+ of public shares and distribution and liquidation if no initial business combination
+ 
+ Our sponsor, officers, and directors
+ have agreed that we will have only 15 months from the closing of this offering (or up to 21 months from the closing of this offering
+ if we extend the period of time to consummate a business combination by the full amount of time) to complete our initial business
+ combination. If we are unable to complete our initial business combination within such 15-month period (or up to 21 months from the
+ closing of this offering if we extend the period of time to consummate a business combination by the full amount of time), we will:
+ (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than
+ ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then
+ on deposit in the trust account, including interest (which interest shall be net of taxes payable, and less up to $50,000 of interest
+ to pay dissolution expenses) divided by the number of then outstanding public shares, which redemption will completely extinguish
+ public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any), subject
+ to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining
+ shareholders and our Board of Directors, liquidate and dissolve, subject in each case to our obligations under British Virgin Islands
+ law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating
+ distributions with respect to our public warrants, public rights, or private placement warrants. The warrants and rights will expire
+ worthless if we fail to complete our initial business combination within the 15-month time period (or up to 21 months from the closing
+ of this offering if we extend the period of time to consummate a business combination by the full amount of time).
+
+ 
+ 
+
+ 
+ 
+ 
+ Our sponsor, officers and directors
+ have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the
+ trust account with respect to their founder shares if we fail to complete our initial business combination within 15 months from
+ the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate
+ a business combination by the full amount of time). However, if our sponsor acquires public shares after this offering, they will
+ be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial
+ business combination within the allotted 15-month time frame (or up to 21 months from the closing of this offering if we extend the
+ period of time to consummate a business combination by the full amount of time). The underwriters have agreed to waive their rights
+ to their deferred underwriting commission held in the trust account in the event we do not complete our initial business combination
+ within 15 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period
+ of time to consummate a business combination by the full amount of time) and, in such event, such amounts will be included with the
+ funds held in the trust account that will be available to fund the redemption of our public shares.
+
+ 
+ 
+
+ 
+ 
+ 
+ Our sponsor, officers, and directors
+ have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum
+ and articles of association that would (i) modify the substance or timing of our obligation to redeem 100% of our public shares
+ if we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months from
+ the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time) or
+ (ii) with respect to the other provisions relating to shareholders rights or pre-business combination activity, unless
+ we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment
+ at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which
+ interest shall be net of taxes payable) divided by the number of then outstanding public shares. However, we may not redeem our public
+ shares in an amount that would cause our net tangible assets to be less than $5,000,001 upon consummation of our initial business
+ combination (so that we are not subject to the SEC s "penny stock" rules).
+
+ 
+ 
+
+ 21
+
+ 
+
+ 
+
+ 
+
+ 
+ Limited payments
+ to insiders
+ 
+ There will be no finder s
+ fees, reimbursements or cash payments made to our sponsor, officers or directors, or our or their affiliates, for services rendered
+ to us prior to or in connection with the completion of our initial business combination, other than the following payments, none
+ of which will be made from the proceeds of this offering and the sale of the private placement warrants held in the trust account
+ prior to the completion of our initial business combination:
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ repayment of an aggregate of up to $400,000 in loans
+ made to us by our sponsor to cover offering-related and organizational expenses;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ reimbursement for any out-of-pocket
+ expenses related to identifying, investigating and completing an initial business combination; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ repayment of loans which may be made by our sponsor or an affiliate of our sponsor
+ or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination,
+ the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,150,000
+ of such loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ These payments may be funded using the net
+ proceeds of this offering and the sale of the private placement warrants not held in the trust account or, upon completion of the
+ initial business combination, from any amounts remaining from the proceeds of the trust account released to us in connection therewith.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our audit committee will review on a quarterly basis all payments
+ that were made to our sponsor, officers or directors, or our or their affiliates.
+
+ 
+
+ 
+
+ 
+ Audit committee
+ 
+ Prior to the effectiveness of this
+ registration statement, we will have established and will maintain an audit committee (which will be composed entirely of independent
+ directors), to among other things, monitor compliance with the terms described above and the other terms relating to this offering.
+ If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action
+ necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see
+ the section entitled "Management Committees of the Board of Directors Audit Committee."
+
+ 
+ 
+ 
+ 
+
+ 
+ Conflicts of interest
+ 
+ Each of our officers and directors presently
+ has, and in the future any of our directors and our officers may have additional, fiduciary or contractual obligations to other entities
+ pursuant to which such officer or director is or will be required to present acquisition opportunities to such entity. Accordingly,
+ subject to his or her fiduciary duties under British Virgin Islands law, if any of our officers or directors becomes aware of an
+ acquisition opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations,
+ he or she will need to honor his or her fiduciary or contractual obligations to present such acquisition opportunity to such entity,
+ and only present it to us if such entity rejects the opportunity. Our amended and restated memorandum and articles of association
+ will provide that, subject to his or her fiduciary duties under British Virgin Islands law, we renounce our interest in any corporate
+ opportunity offered to any officer or director unless such opportunity is expressly offered to such person solely in his or her capacity
+ as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would
+ otherwise be reasonable for us to pursue. We do not believe, however, that any fiduciary duties or contractual obligations of our
+ directors or officers would materially undermine our ability to complete our business combination.
+
+ 
+ 
+
+ 
+ Indemnity
+ 
+ Our
+ sponsor has agreed that it will be liable to us if and to the extent any claims by a vendor
+ for services rendered or products sold to us, or a prospective target business with which
+ we have discussed entering into a transaction agreement, reduce the amount of funds in the
+ trust account to below (i) $10.175 per public share or (ii) such lesser amount
+ per public share held in the trust account as of the date of the liquidation of the trust
+ account due to reductions in the value of the trust assets, in each case net of the interest
+ which may be withdrawn to pay taxes, except as to any claims by a third party who executed
+ a waiver of any and all rights to seek access to the trust account and except as to any claims
+ under our indemnity of the underwriters of this offering against certain liabilities, including
+ liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed
+ to be unenforceable against a third party, our sponsor will not be responsible to the extent
+ of any liability for such third -party claims. We have not independently verified whether
+ our sponsor has sufficient funds to satisfy their indemnity obligations and believe that
+ our sponsor s only assets are securities of our company. We have not asked our sponsor
+ to reserve for such obligations.
+
+ 
+
+ 
+ 
+
+ 22
+
+ 
+
+ 
+
+ 
+
+Risks
+
+ 
+
+We are a newly incorporated
+company that has conducted no operations and has generated no revenues. Until we complete our initial business combination, we will have
+no operations and will generate no operating revenues. In making your decision whether to invest in our securities, you should take into
+account not only the background of our management team, but also the special risks we face as a blank check company. This offering is
+not being conducted in compliance with Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections
+normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank
+check offerings differ from this offering, please see "Proposed Business Comparison of This Offering to Those of Blank
+Check Companies Subject to Rule 419." You should carefully consider these and the other risks set forth in the section of
+this prospectus entitled "Risk Factors."
+
+ 
+
+Even if we complete our
+initial business combination, the combined company whose securities the investors may invest in may be a holding company with substantive
+business operations conducted by its subsidiaries. You should carefully consider all of the information in this prospectus before making
+an investment.
+
+ 
+
+ 23
+
+ 
+
+ 
+
+ 
+
+Summary Financial Data
+
+ 
+
+The following table summarizes the relevant
+financial data for our business and should be read together with our financial statements, which are included elsewhere in this prospectus.
+We have not had any significant operations to date, so only balance sheet data is presented.
+
+ 
+
+ 
+ 
+ 
+ December 31, 2021
+ 
+
+ 
+ Balance Sheet Data:
+ 
+ Actual
+ 
+ 
+ As Adjusted
+ 
+
+ 
+ Working capital (1)
+ 
+ $
+ (79,692
+ )
+ 
+ $
+ 1,372,240 
+ 
+
+ 
+ Total assets (2)
+ 
+ 
+ 140,115
+ 
+ 
+ 
+ 189,609,740
+ 
+
+ 
+ Total liabilities (3)
+ 
+ 
+ 117,875
+ 
+ 
+ 
+ 6,658,150 
+ 
+
+ 
+ Value of Class A ordinary shares subject to possible redemption (4)
+ 
+ 
+ -
+ 
+ 
+ 
+ 188,237,500
+ 
+
+ 
+ Shareholder s equity (5)
+ 
+ 
+ 22,240
+ 
+ 
+ 
+ (5,285,910
+ )
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ (1)
+ The "as adjusted" calculation includes
+ $1,350,000 in cash held outside the trust account, plus $22,240 of actual shareholder s equity as of December 31, 2021.
+
+ 
+
+ 
+
+ 
+ 
+ (2)
+ The "as adjusted" calculation includes
+ $188,237,500 cash held in trust from the proceeds of this offering and the sale of the private placement warrants, plus $1,350,000
+ in cash held outside the trust account, plus $22,240 of actual shareholder s equity as of December 31, 2021.
+
+ 
+
+ 
+
+ 
+ 
+ (3)
+ The "as
+ adjusted" calculation includes $6,475,000 of deferred underwriting commissions and
+ $183,150 for the over-allotment fair value booked as a liability until the over-allotment
+ option is exercised or expires.
+
+ 
+
+ 
+
+ 
+ 
+ (4)
+ Excludes 18,500,000
+ shares of Class A ordinary shares purchased in the public market which are subject to redemption
+ in connection with our initial business combination. The "as adjusted" calculation
+ equals the "as adjusted" total assets, less the "as adjusted" total
+ liabilities, less the value of Class A ordinary shares that may be redeemed in connection
+ with our initial business combination (approximately $10.175 per share).
+
+ 
+
+ 
+
+If no business combination is completed within
+15 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time to
+consummate a business combination by the full amount of time, as described in more detail in this prospectus), the proceeds then on deposit
+in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our franchise
+and income taxes as well as expenses relating to the administration of the trust account (less up to $50,000 of interest released to
+us to pay dissolution expenses), will be used to fund the redemption of our public shares. Our sponsor, officers and directors have entered
+into a letter agreement with us, pursuant to which they have agreed to waive their rights to liquidating distributions from the trust
+account with respect to any founder shares held by them if we fail to complete our initial business combination within such time period.
+
+ 
+
+ 24
+
+ 
+
+ 
+
+ 
+
+RISKS
+
+ 
+
+Summary of Risk Factors
+
+ 
+
+An
+investment in our securities involves a high degree of risk. The occurrence of one or more of the events or circumstances described in
+the section titled "Risk Factors," beginning on page 30 of this prospectus, alone or in combination with other events or
+circumstances, may materially adversely affect our business, financial condition and operating results. In that event, the trading price
+of our securities could decline, and you could lose all or part of your investment.
+
+ 
+
+You
+should carefully consider these and the other risks set forth in the section entitled "Risk Factors", including, among others,
+the following:
+
+ 
+
+ 
+ 
+ 
+ We are a are a newly incorporated company established under
+ the laws of the British Virgin Islands with no operating results, and you have no basis on which to evaluate our ability to achieve
+ our business objective.
+
+ 
+ 
+
+ 
+ 
+ Our independent registered public accounting firm s report contains an explanatory
+ paragraph that expresses substantial doubt about our ability to continue as a "going concern."
+
+ 
+
+ 
+ 
+ 
+ Our public shareholders may not be afforded an opportunity
+ to vote on our proposed initial business combination, which means we may complete our initial business combination even though a
+ majority of our public shareholders do not support such a combination.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ If we seek shareholder approval of our initial business combination, our sponsor, officers and directors
+ have agreed to vote in favor of such initial business combination, regardless of how our public shareholders vote.
+
+ 
+ 
+
+ 
+ 
+ 
+ Your only opportunity to affect your investment decision
+ regarding a potential business combination may be limited to the exercise of your right to redeem your shares from us for cash.
+
+ 
+ 
+
+ 
+ 
+ The ability of our public shareholders to redeem their shares for cash may make our financial
+ condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combination
+ with a target.
+
+ 
+
+ 
+ 
+ The ability of our public shareholders to exercise redemption rights with respect to
+ a large number of our shares may not allow us to complete the most desirable business combination or optimize our capittal structure.
+
+ 
+
+ 
+ 
+ Our search for a business combination, and any target business with which we ultimately
+ consummate a business combination, may be materially adversely affected by the recent coronavirus (COVID-19) outbreak and
+ other events and the status of debt and equity markets.
+
+ 
+
+ 
+ 
+ 
+ We
+ may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all operations
+ except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public shareholders may
+ only receive $10.175 per share, or less than such amount in certain circumstances, and our warrants and rights will expire worthless.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ The requirement that we complete our initial business combination within the prescribed
+ time frame after the closing of this offering may give potential target businesses leverage over us in negotiating a business
+ combination and may limit the time we have in which to conduct due diligence on potential business combination targets, in particular
+ as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms
+ that would produce value for our shareholders.
+
+ 
+ 
+
+ 
+ 
+ 
+ If we seek shareholder approval of our initial business
+ combination, our sponsor, directors, officers, advisors or their affiliates may elect to purchase shares or warrants from public
+ shareholders, which may influence a vote on a proposed business combination and reduce the public "float" of our securities.
+
+ 
+ 
+
+ 
+ 
+ 
+ If a shareholder fails to receive notice of our offer to
+ redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for submitting
+ or tendering its shares, such shares may not be redeemed.
+
+ 
+ 
+
+ 
+ 
+ 
+ You will not be entitled
+ to protections normally afforded to investors of many other blank check companies.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ If we seek shareholder
+ approval of our intial business combination and we do not conduct redemptions pursuant to
+ the tender offer riles, and if you or a "group" of shareholders are deemed to
+ hold in excess of 15% of our Class A ordinary shares, you will lose the ability to redeem
+ all such shares in excess of 15% of our Class A ordinary shares.
+
+ 
+ 
+
+ 
+ 
+ 
+ Because
+ of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us
+ to complete our initial business combination. If we have not completed our initial business combination within the required time
+ period, our public shareholders may receive only approximately $10.175 per share, or less in certain circumstances, on our redemption
+ of their shares, and our warrants and rights will expire worthless.
+
+ 
+ 
+
+ 
+ 
+ 
+ If the net proceeds
+ of this offering and the sale of the private placement warrants not being held in the trust
+ account are insufficient to allow us to operate for at least the prescribed time frame following
+ the closing of this offering, it could limit the amount of cash available to fund our search
+ for a target business or businesses and complete our initial business combination, and we
+ will depend on loans from our sponsor or management team to fund our search and to complete
+ our initial business combination.
+
+ 
+ 
+
+ 
+ 
+ 
+ If third parties bring
+ claims against us, the proceeds held in the trust account could be reduced and the per-share
+ redemption amount received by shareholders may be less than $10.175 per share.
+
+ 
+ 
+
+ 
+ 
+ 
+ Our directors may
+ decide not to enforce the indemnification obligations of our sponsor, resulting in a
+ reduction in the amount of funds in the trust account available for distribution to our public
+ shareholders.
+
+ 
+ 
+
+ 
+ 
+ If, after we distribute
+ the proceeds in the trust account to our public shareholders, we file a bankruptcy petition
+ or an involuntary bankruptcy petition is filed against us that is not dismissed, a bankruptcy
+ court may seek to recover such proceeds, and the members of our Board of Directors may be
+ viewed as having breached their fiduciary duties to our creditors, thereby exposing the members
+ of our Board of Directors and us to claims of punitive damages.
+
+ 
+
+ 
+ 
+ If, before distributing
+ the proceeds in the trust account to our public shareholders, we file a bankruptcy petition
+ or an involuntary bankruptcy petition is filed against us that is not dismissed, the claims
+ of creditors in such proceeding may have priority over the claims of our shareholders and
+ the per-share amount that would otherwise be received by our shareholders in connection with
+ our liquidation may be reduced.
+
+ 
+
+ 25
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ If we are deemed to
+ be an investment company under the Investment Company Act, we may be required to institute
+ burdensome compliance requirements and our activities may be restricted, which may make it
+ difficult for us to complete our initial business combination.
+
+ 
+
+ 
+ 
+ Changes in laws or
+ regulations, or a failure to comply with any laws and regulations, may adversely affect our
+ business, investments and results of operations.
+
+ 
+
+ 
+ 
+ Because we are not
+ limited to a particular industry or any specific target businesses with which to pursue our
+ initial business combination, you will be unable to ascertain the merits or risks of any
+ particular target business s operations.
+
+ 
+
+ 
+ 
+ We may seek acquisition
+ opportunities in industries or sectors that may be outside of our management s areas
+ of expertise.
+
+ 
+
+ 
+ 
+ Although we have identified
+ general criteria and guidelines that we believe are important in evaluating prospective target
+ businesses, we may enter into our initial business combination with a target that does not
+ meet such criteria and guidelines, and as a result, the target business with which we enter
+ into our initial business combination may not have attributes entirely consistent with our
+ general criteria and guidelines.
+
+ 
+
+ 
+ 
+ We may seek acquisition
+ opportunities with a financially unstable business or an entity lacking an established record
+ of revenue or earnings.
+
+ 
+
+ 
+ 
+ We are not required
+ to obtain an opinion from an independent investment banking or from an independent accounting
+ firm, and consequently, you may have no assurance from an independent source that the price
+ we are paying for the business is fair to our company from a financial point of view.
+
+ 
+
+ 
+ 
+ We may issue additional
+ Class A ordinary or preference shares to complete our initial business combination or
+ under an employee incentive plan after completion of our initial business combination. Any
+ such issuances would dilute the interest of our shareholders and likely present other risks.
+
+ 
+
+ 
+ 
+ 
+ Resources
+ could be wasted in researching acquisitions that are not completed, which could materially adversely affect subsequent attempts to
+ locate and acquire or merge with another business. If we are unable to complete our initial business combination, our public shareholders
+ may receive only approximately $10.175 per share, or less than such amount in certain circumstances, on the liquidation of our trust
+ account and our warrants and rights will expire worthless.
+
+ 
+ 
+
+ 
+ 
+ We may engage in a
+ business combination with one or more target businesses that have relationships with entities
+ that may be affiliated with our sponsor, officers, directors or existing holders which may
+ raise potential conflicts of interest.
+
+ 
+
+ 
+ 
+ Affiliates of our
+ sponsor may be involved in other blank check companies like ours and may direct potential
+ targets to those companies rather than to us.
+
+ 
+
+ 
+ 
+ Since our sponsor,
+ officers and directors will lose their entire investment in us if our initial business combination
+ is not completed, a conflict of interest may arise in determining whether a particular business
+ combination target is appropriate for our initial business combination.
+
+ 
+
+ 
+ 
+ We may issue notes
+ or other debt securities, or otherwise incur substantial debt, to complete a business combination,
+ which may adversely affect our leverage and financial condition and thus negatively impact
+ the value of our shareholders investment in us.
+
+ 
+
+ 
+ 
+ We may only be able
+ to complete one business combination with the proceeds of this offering and the sale of the
+ private placement warrants, which will cause us to be solely dependent on a single business
+ which may have a limited number of products or services. This lack of diversification may
+ negatively impact our operations and profitability.
+
+ 
+
+ 
+ 
+ We may attempt to
+ simultaneously complete business combinations with multiple prospective targets, which may
+ hinder our ability to complete our initial business combination and give rise to increased
+ costs and risks that could negatively impact our operations and profitability.
+
+ 
+
+ 
+ 
+ We do not have a specified
+ maximum redemption threshold. The absence of such a redemption threshold may make it possible
+ for us to complete a business combination with which a substantial majority of our shareholders
+ have redeemed their Class A ordinary shares.
+
+ 
+
+ 
+ 
+ In order to effectuate
+ an initial business combination, blank check companies have, in the recent past, amended
+ various provisions of their charters and modified governing instruments. We cannot assure
+ you that we will not seek to amend our amended and restated memorandum and articles of association
+ or governing instruments in a manner that will make it easier for us to complete our initial
+ business combination that our shareholders may not support.
+
+ 
+
+ 26
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ The provisions of
+ our amended and restated memorandum and articles of association that relate to our pre-initial
+ business combination activity (and corresponding provisions of the agreement governing the
+ release of funds from our trust account), including an amendment to permit us to withdraw
+ funds from the trust account such that the per share amount investors will receive upon any
+ redemption or liquidation is substantially reduced or eliminated, may be amended with the
+ approval of holders of at least a majority of our ordinary shares who attend and vote in
+ a general meeting, which is a lower amendment threshold than that of some other blank check
+ companies. It may be easier for us, therefore, to amend our amended and restated memorandum
+ and articles of association and the trust agreement to facilitate the completion of an initial
+ business combination that some of our shareholders may not support.
+
+ 
+
+ 
+ 
+ We may be unable to
+ obtain additional financing to complete our initial business combination or to fund the operations
+ and growth of a target business, which could compel us to restructure or abandon a particular
+ business combination.
+
+ 
+
+ 
+ 
+ Our sponsor will control
+ the election of our Board of Directors until consummation of our initial business combination
+ and will hold a substantial interest in us. As a result, it will elect all of our directors
+ and may exert a substantial influence on actions requiring shareholder vote, potentially
+ in a manner that you do not support.
+
+ 
+
+ 
+ 
+ Because we must furnish
+ our shareholders with target business financial statements, we may lose the ability to complete
+ an otherwise advantageous initial business combination with some prospective target businesses.
+
+ 
+
+ 
+ 
+ Compliance obligations
+ under the Sarbanes-Oxley Act may make it more difficult for us to effectuate our initial
+ business combination, require substantial financial and management resources, and increase
+ the time and costs of completing an acquisition.
+
+ 
+
+ 
+ 
+ A majority of our
+ directors and officers currently live outside the United States and, after a business combination,
+ it is possible that a majority of our directors and officers and all of our assets will be
+ located outside the United States; therefore, investors may not be able to enforce federal
+ securities laws or their other legal rights.
+
+ 
+
+ 
+ 
+ If we effect a business
+ combination with a company located outside of the United States, the laws applicable to such
+ company will likely govern all of our material agreements and we may not be able to enforce
+ our legal rights.
+
+ 
+
+ 
+ 
+ If relations between
+ the United States and foreign governments deteriorate, it could cause potential target
+ businesses or their goods and services to become less attractive.
+
+ 
+
+ 
+ 
+ The ability of our
+ public shareholders to exercise redemption rights with respect to a large number of our shares
+ could increase the probability that our initial business combination would be unsuccessful
+ and that you would have to wait for liquidation in order to redeem your shares.
+
+ 
+
+ 
+ 
+ Currency policies
+ may harm a target business ability to succeed in the international market.
+
+ 
+
+ 
+ 
+ Certain economies
+ in Asia are experiencing substantial inflationary pressures which may prompt governments
+ to take action to control the growth of the economy and inflation that could lead to a significant
+ decrease in our profitability following our initial business combination.
+
+ 
+
+ 
+ 
+ Many industries in
+ Asia are subject to government regulations that limit or prohibit foreign investments in
+ those industries, which may limit the potential number of acquisition candidates.
+
+ 
+
+ 
+ 
+ If a country in Asia
+ enacts regulations in industry segments that forbid or restrict foreign investment, our ability
+ to consummate our initial business combination could be severely impaired.
+
+ 
+
+ 
+ 
+ Corporate governance
+ standards in Asia may not be as strict or developed as in the United States and such
+ weakness may hide issues and operational practices that are detrimental to a target business.
+
+ 
+
+ 
+ 
+ If we are unable to
+ consummate our initial business combination within 15 months of the closing of this offering
+ (or up to 21 months from the closing of this offering if we extend the period of time to
+ consummate a business combination by the full amount of time), our public shareholders may
+ be forced to wait beyond such 15 months (or up to 21 months from the closing of this offering
+ if we extend the period of time to consummate a business combination by the full amount of
+ time) before redemption from our trust account.
+
+ 
+
+ 
+ 
+ We may not hold an
+ annual meeting of shareholders until after the consummation of our initial business combination.
+ Our public shareholders will not have the right to elect directors prior to the consummation
+ of our initial business combination.
+
+ 
+
+ 27
+
+ 
+
+ 
+
+ 
+
+Risks Relating to the Post-Business Combination Company, beginning
+on page [ ]:
+
+ 
+
+ 
+ 
+ 
+ We may face risks related to financial technology businesses.
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Subsequent to the completion of our initial business combination, we
+ may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative
+ effect on our financial condition, results of operations and our share price, which could cause you to lose some or all of your investment.
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our ability to successfully effect our initial business combination
+ and to be successful thereafter will be totally dependent upon the efforts of our key personnel, some of whom may join us following
+ our initial business combination. The loss of key personnel could negatively impact the operations and profitability of our post-combination
+ business. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our management may not be able to maintain control of a target business
+ after our initial business combination. We cannot provide assurance that, upon loss of control of a target business, new management
+ will possess the skills, qualifications or abilities necessary to profitably operate such business. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We may reincorporate in another jurisdiction in connection with our
+ initial business combination and such reincorporation may result in taxes imposed on shareholders. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We may have a limited ability to assess the management of a prospective
+ target business and, as a result, may effect our initial business combination with a target business whose management may not have
+ the skills, qualifications or abilities to manage a public company. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Since our sponsor, officers and directors will not be eligible to be
+ reimbursed for their out-of-pocket expenses if our initial business combination is not completed, a conflict of interest may arise
+ in determining whether a particular business combination target is appropriate for our initial business combination. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We may reincorporate in another jurisdiction in connection with our
+ initial business combination and such reincorporation may result in taxes imposed on shareholders. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We may have a limited ability to assess the management of a prospective
+ target business and, as a result, may effect our initial business combination with a target business whose management may not have
+ the skills, qualifications or abilities to manage a public company. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Since our sponsor, officers and directors will not be eligible to be
+ reimbursed for their out-of-pocket expenses if our initial business combination is not completed, a conflict of interest may arise
+ in determining whether a particular business combination target is appropriate for our initial business combination. 
+
+ 
+ 
+
+Risks Relating to our Management Team, beginning on page
+[ ] :
+
+ 
+
+ 
+ 
+ 
+ We are dependent upon our officers and directors and their
+ departure could adversely affect our ability to operate. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our key personnel may negotiate employment or consulting agreements
+ with a target business in connection with a particular business combination. These agreements may provide for them to receive compensation
+ following our initial business combination and as a result, may cause them to have conflicts of interest in determining whether a
+ particular business combination is the most advantageous. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our officers and directors will allocate their time to other businesses
+ thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest
+ could have a negative impact on our ability to complete our initial business combination. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Certain of our officers and directors are now, and all of them may
+ in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by us and,
+ accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented.
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our officers, directors, security holders and their respective affiliates
+ may have competitive pecuniary interests that conflict with our interests. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We may not have sufficient funds to satisfy indemnification claims
+ of our directors and executive officers. 
+
+ 
+
+ 
+
+ 28
+
+ 
+
+ 
+
+ 
+
+Risks Relating to our Securities and This Offiering, beginning
+on page 50:
+
+ 
+
+ 
+ 
+ 
+ You will not
+ have any rights or interests in funds from the trust account, except under certain limited circumstances. Therefore, to liquidate
+ your investment, you may be forced to sell your public shares potentially at a loss.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Nasdaq may delist our securities
+ from trading on its exchange, which could limit investors ability to make transactions in our securities and subject us to
+ additional trading restrictions. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The determination of the
+ offering price of our units and the size of this offering is more arbitrary than the pricing of securities and size of an offering
+ of an operating company in a particular industry. You may have less assurance, therefore, that the offering price of our units properly
+ reflects the value of such units than you would have in a typical offering of an operating company. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ There is currently no market
+ for our securities and a market for our securities may not develop, which would adversely affect the liquidity and price of our securities.
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Provisions in our amended
+ and restated memorandum and articles of association may inhibit a takeover of us, which could limit the price investors might be
+ willing to pay in the future for our Class A ordinary shares and could entrench management. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We may amend the terms
+ of the warrants in a manner that may be adverse to holders of public warrants with the approval by the holders of at least a majority
+ of the then outstanding public warrants.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We may redeem your unexpired
+ warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We are not registering
+ the Class A ordinary shares issuable upon exercise of the warrants under the Securities Act or any state securities laws at this
+ time, and such registration may not be in place when an investor desires to exercise warrants, thus precluding such investor from
+ being able to exercise its warrants except on a cashless basis and potentially causing such warrants to expire worthless.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Because each unit contains
+ one-half of one redeemable warrant and only a whole warrant may be exercised, the units may be worth less than units of other blank
+ check companies.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our management s
+ ability to require holders of our warrants to exercise such warrants on a cashless basis will cause holders to receive fewer Class
+ A ordinary shares upon their exercise of the warrants than they would have received had they been able to exercise their warrants
+ for cash.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The grant of registration
+ rights to our sponsor and holders of our private placement warrants may make it more difficult to complete our initial business combination,
+ and the future exercise of such rights may adversely affect the market price of our Class A ordinary shares. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We may issue our shares
+ to investors in connection with our initial business combination at a price which is less than the prevailing market price of our
+ shares at that time. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Changes in the market for
+ directors and officers liability insurance could make it more difficult and more expensive for us to negotiate and complete an initial
+ business combination. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our warrant agreement and
+ rights agreement will designate the courts of the State of New York or the United States District Court for the Southern District
+ of New York as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by holders of our
+ warrants or rights, which could limit the ability of warrant holders and rights holders to obtain a favorable judicial forum for
+ disputes with our company.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We may amend the terms
+ of the rights in a way that may be adverse to holders with the approval by the holders of a majority of the then outstanding rights.
+
+ 
+ 
+
+ 29
+
+ 
+
+ 
+
+ 
+
+RISK FACTORS
+
+ 
+
+An investment in our
+securities involves a high degree of risk. You should consider carefully all of the risks described below, together with the other information
+contained in this prospectus, before making a decision to invest in our units. If any of the following events occur, our business, financial
+condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline,
+and you could lose all or part of your investment.
+
+ 
+
+Risks Relating to our Search for, and Consummation
+of or Inability to Consummate, a Business Combination
+
+ 
+
+Our public shareholders may not be afforded
+an opportunity to vote on our proposed business combination, which means we may complete our initial business combination even though
+a majority of our public shareholders do not support such a combination.
+
+ 
+
+We may not hold a shareholder
+vote to approve our initial business combination unless the business combination would require shareholder approval under applicable
+British Virgin Islands law or the rules of NASDAQ or if we decide to hold a shareholder vote for business or other reasons. Examples
+of transactions that would not ordinarily require shareholder approval include asset acquisitions and share purchases, while transactions
+such as direct mergers with our company or transactions where we issue more than 20% of our outstanding shares would require shareholder
+vote. For instance, NASDAQ rules currently allow us to engage in a tender offer in lieu of a shareholder meeting but would still
+require us to obtain shareholder approval if we were seeking to issue more than 20% of our outstanding shares to a target business as
+consideration in any business combination. Therefore, if we were structuring a business combination that required us to issue more than
+20% of our outstanding shares, we would seek shareholder approval of such business combination. Except as required by law or NASDAQ rules,
+the decision as to whether we will seek shareholder approval of a proposed business combination or will allow shareholders to sell their
+shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors, such as the timing
+of the transaction and whether the terms of the transaction would otherwise require us to seek shareholder approval. Accordingly, we
+may consummate our initial business combination even if holders of a majority of the issued and outstanding ordinary shares do not approve
+of the business combination we consummate. Please see the section entitled "Proposed Business Effecting Our Initial Business
+Combination Shareholders may not have the ability to approve our initial business combination" for additional information.
+
+ 
+
+If we seek shareholder approval of our
+initial business combination, our sponsor, officers and directors have agreed to vote in favor of such initial business combination,
+regardless of how our public shareholders vote.
+
+ 
+
+Unlike other blank check
+companies in which the initial shareholders agree to vote their founder shares in accordance with the majority of the votes cast by the
+public shareholders in connection with an initial business combination, our sponsor, officers and directors have agreed (and their permitted
+transferees will agree), pursuant to the terms of a letter agreement entered into with us, to vote any founder shares held by them, as
+well as any public shares purchased during or after this offering, in favor of our initial business combination. We expect that our sponsor
+and its permitted transferees will own at least 20% of our issued and outstanding ordinary shares at the time of any such shareholder
+vote. As a result, in addition to our initial shareholder s founder shares, we would need only 6,798,751 or 37%, of the 18,500,000
+public shares sold in this offering to be voted in favor of a transaction (assuming all outstanding shares are voted and all shares to
+be issued to Maxim and/or its designees are issued and outstanding and voted in favor of the business combination) or 948,126 or 5%,
+of the 18,500,000 public shares sold in this offering to be voted in favor of a transaction (assuming only a quorum is present at such
+meeting held to vote on our initial business combination and all shares to be issued to Maxim and/or its designees are issued and outstanding
+and voted in favor of the business combination) in order to have our initial business combination approved (assuming the over-allotment
+option is not exercised). Accordingly, if we seek shareholder approval of our initial business combination, it is more likely that the
+necessary shareholder approval will be received than would be the case if such persons agreed to vote their founder shares in accordance
+with the majority of the votes cast by our public shareholders.
+
+ 
+
+Your only opportunity to affect the investment decision regarding
+a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash, unless we seek
+shareholder approval of the business combination.
+
+ 
+
+At the time of your investment
+in us, you will not be provided with an opportunity to evaluate the specific merits or risks of one or more target businesses. Since
+our Board of Directors may complete a business combination without seeking shareholder approval, public shareholders may not have the
+right or opportunity to vote on the business combination, unless we seek such shareholder approval. Accordingly, if we do not seek shareholder
+approval, your only opportunity to affect the investment decision regarding a potential business combination may be limited to exercising
+your redemption rights within the period of time (which will be at least 20 business days) set forth in our tender offer documents mailed
+to our public shareholders in which we describe our initial business combination.
+
+ 
+
+ 30
+
+ 
+
+ 
+
+ 
+
+The ability of our public shareholders
+to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make
+it difficult for us to enter into a business combination with a target.
+
+ 
+
+We may seek to enter into
+a business combination transaction agreement with a prospective target that requires as a closing condition that we have a minimum net
+worth or a certain amount of cash. If too many public shareholders exercise their redemption rights, we would not be able to meet such
+closing condition and, as a result, would not be able to proceed with the business combination. Furthermore, in no event will we redeem
+our public shares in an amount that would cause our net tangible assets, after payment of the deferred underwriting commissions, to be
+less than $5,000,001 upon consummation of our initial business combination (so that we are not subject to the SEC s "penny
+stock" rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial
+business combination. Consequently, if accepting all properly submitted redemption requests would cause our net tangible assets to be
+less than $5,000,001 upon consummation of our initial business combination or such greater amount necessary to satisfy a closing condition
+as described above, we would not proceed with such redemption and the related business combination and may instead search for an alternate
+business combination. Prospective targets will be aware of these risks and, thus, may be reluctant to enter into a business combination
+transaction with us.
+
+ 
+
+The ability of our public shareholders
+to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination
+or optimize our capital structure.
+
+ 
+
+At the time we enter into
+an agreement for our initial business combination, we will not know how many shareholders may exercise their redemption rights, and therefore
+we will need to structure the transaction based on our expectations as to the number of shares that will be submitted for redemption.
+If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price,
+or requires us to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the trust account to meet
+such requirements, or arrange for third party financing. In addition, if a larger number of shares are submitted for redemption than
+we initially expected, we may need to restructure the transaction to reserve a greater portion of the cash in the trust account or arrange
+for third party financing. Raising additional third party financing may involve dilutive equity issuances or the incurrence of indebtedness
+at higher than desirable levels. Furthermore, this dilution would increase to the extent that the anti-dilution provisions of the Class B
+ordinary shares result in the issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion of the Class B
+shares at the time of the initial business combination. The above considerations may limit our ability to complete the most desirable
+business combination available to us or optimize our capital structure.
+
+ 
+
+Our search for a business combination,
+and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the recent
+coronavirus (COVID-19) outbreak and the status of debt and equity markets.
+
+ 
+
+Our search for a business
+combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected
+by the coronavirus (COVID-19) outbreak and the status of debt and equity markets. The COVID-19 outbreak has adversely affected (and a
+significant outbreak of other infectious diseases could result in an additional widespread health crisis that could adversely affect)
+the economies and financial markets worldwide, and the business of any potential target business with which we consummate a business
+combination could be materially and adversely affected by the COVID-19 outbreak and such other outbreak. Furthermore, we may be unable
+to complete a business combination if continued concerns relating to COVID-19 continue to restrict travel, limit the ability to have
+meetings with potential investors or result in the target company s personnel, vendors and services providers being unavailable
+to negotiate and consummate a transaction in a timely manner. The extent to which COVID-19 impacts our search for a business combination
+will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning
+the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others. If the disruptions posed by COVID-19
+or other matters of global concern continue for an extended period of time, our ability to consummate a business combination, or the
+operations of a target business with which we ultimately consummate a business combination, may be materially adversely affected. In
+addition, our ability to consummate a transaction may be dependent on our ability to raise equity and debt financing which may be adversely
+impacted by COVID-19 and other events, including as a result of increased market volatility, decreased market liquidity and third-party
+financing being unavailable on terms acceptable to us or at all.
+
+ 
+
+We may not be able to complete our initial
+business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding
+up and we would redeem our public shares and liquidate, in which case our public shareholders may only receive $10.175 per share, or
+less than such amount in certain circumstances, and our warrants and rights will expire worthless.
+
+ 
+
+Our sponsor, officers and
+directors have agreed that we must complete our initial business combination within 15 months from the closing of this offering (or
+up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount
+of time). We may not be able to find a suitable target business and complete our initial business combination within such time period.
+If we have not completed our initial business combination within such time period, we will: (i) cease all operations except for
+the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public
+shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest
+(which interest shall be net of taxes payable, and less up to $50,000 of interest to pay dissolution expenses) divided by the number
+of then outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including
+the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably
+possible following such redemption, subject to the approval of our remaining shareholders and our Board of Directors, liquidate and dissolve,
+subject in each case to our obligations under British Virgin Islands law to provide for claims of creditors and the requirements of other
+applicable law. In certain circumstances, our public shareholders may receive less than $10.175 per share on the redemption of their
+shares. See "Risk Factors — If third parties bring claims against us, the proceeds held in the trust account could be reduced
+and the per-share redemption amount received by shareholders may be less than $10.175 per share" and other risk factors herein.
+
+ 
+
+ 31
+
+ 
+
+ 
+
+ 
+
+The requirement that we complete our initial
+business combination within the prescribed time frame may give potential target businesses leverage over us in negotiating a business
+combination and may decrease our ability to conduct due diligence on potential business combination targets as we approach our dissolution
+deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our shareholders.
+
+ 
+
+Any potential target business
+with which we enter into negotiations concerning a business combination will be aware that we must complete our initial business combination
+within 15 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time
+to consummate a business combination by the full amount of time). Consequently, such target business may obtain leverage over us in negotiating
+a business combination, knowing that if we do not complete our initial business combination with that particular target business, we
+may be unable to complete our initial business combination with any target business. This risk will increase as we get closer to the
+timeframe described above. In addition, we may have limited time to conduct due diligence and may enter into our initial business combination
+on terms that we would have rejected upon a more comprehensive investigation.
+
+ 
+
+If we seek shareholder approval of our
+initial business combination, our sponsor, directors, officers, advisors and their affiliates may elect to purchase shares from public
+shareholders, which may influence a vote on a proposed business combination and reduce the public "float" of our Class A
+ordinary shares.
+
+ 
+
+If we seek shareholder approval
+of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to
+the tender offer rules, our sponsor, directors, officers, advisors or their affiliates may purchase shares or warrants in privately negotiated
+transactions or in the open market either prior to or following the completion of our initial business combination, although they are
+under no obligation to do so. Please see "Proposed Business Permitted purchases of our securities" for a description
+of how such persons will determine which shareholders to seek to acquire shares from. Such a purchase may include a contractual acknowledgement
+that such shareholder, although still the record holder of our shares is no longer the beneficial owner thereof and therefore agrees
+not to exercise its redemption rights. In the event that our sponsor, directors, officers, advisors or their affiliates purchase shares
+in privately negotiated transactions from public shareholders who have already elected to exercise their redemption rights, such selling
+shareholders would be required to revoke their prior elections to redeem their shares. The price per share paid in any such transaction
+may be different than the amount per share a public shareholder would receive if it elected to redeem its shares in connection with our
+initial business combination. The purpose of such purchases could be to vote such shares in favor of the business combination and thereby
+increase the likelihood of obtaining shareholder approval of the business combination or to satisfy a closing condition in an agreement
+with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination,
+where it appears that such requirement would otherwise not be met. This may result in the completion of our initial business combination
+that may not otherwise have been possible.
+
+ 
+
+In addition, if such purchases
+are made, the public "float" of our Class A ordinary shares, or warrants and the number of beneficial holders of our
+securities may be reduced, possibly making it difficult to maintain or obtain the quotation, listing or trading of our securities on
+a national securities exchange.
+
+ 
+
+If a shareholder fails to receive notice
+of our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the procedures
+for tendering its shares, such shares may not be redeemed.
+
+ 
+
+We will comply with the
+tender offer rules or proxy rules, as applicable, when conducting redemptions in connection with our initial business combination.
+Despite our compliance with these rules, if a shareholder fails to receive our tender offer or proxy materials, as applicable, such shareholder
+may not become aware of the opportunity to redeem its shares. In addition, the tender offer documents or proxy materials, as applicable,
+that we will furnish to holders of our public shares in connection with our initial business combination will describe the various procedures
+that must be complied with in order to validly tender or redeem public shares. In the event that a shareholder fails to comply with these
+procedures, its shares may not be redeemed. See "Proposed Business — Business Strategy — Tendering share certificates
+in connection with a tender offer or redemption rights".
+
+ 
+
+You will not be entitled to protections
+normally afforded to investors of many other blank check companies.
+
+ 
+
+Since the net proceeds of
+this offering and the sale of the private placement warrants are intended to be used to complete an initial business combination with
+a target business that has not been identified, we may be deemed to be a "blank check" company under the U.S. securities
+laws. However, because we will have net tangible assets in excess of $5,000,000 upon the successful completion of this offering and the
+sale of the private placement warrants and will file a Current Report on Form 8-K, including an audited balance sheet demonstrating
+this fact, we are exempt from rules promulgated by the SEC to protect investors in blank check companies, such as Rule 419.
+Accordingly, investors will not be afforded the benefits or protections of those rules. Among other things, this means our units will
+be immediately tradable and we will have a longer period of time to complete our initial business combination than do companies subject
+to Rule 419. Moreover, if this offering were subject to Rule 419, that rule would prohibit the release of any interest
+earned on funds held in the trust account to us unless and until the funds in the trust account were released to us in connection with
+our completion of an initial business combination. For a more detailed comparison of our offering to offerings that comply with Rule 419,
+please see "Proposed Business Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419."
+
+ 
+
+ 32
+
+ 
+
+ 
+
+ 
+
+If we seek shareholder approval of our
+initial business combination and we do not conduct redemptions pursuant to the tender offer rules, and if you or a "group"
+of shareholders are deemed to hold in excess of 15% of our Class A ordinary shares, you will lose the ability to redeem all such
+shares in excess of 15% of our Class A ordinary shares.
+
+ 
+
+If we seek shareholder approval
+of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to
+the tender offer rules, our amended and restated memorandum and articles of association will provide that a public shareholder, together
+with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a "group"
+(as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect to more than an
+aggregate of 15% of the shares sold in this offering, which we refer to as the "Excess Shares." However, we would not be
+restricting our shareholders ability to vote all of their shares (including Excess Shares) for or against our initial business
+combination. Your inability to redeem the Excess Shares will reduce your influence over our ability to complete our initial business
+combination and you could suffer a material loss on your investment in us if you sell Excess Shares in open market transactions. Additionally,
+you will not receive redemption distributions with respect to the Excess Shares if we complete our initial business combination. And
+as a result, you will continue to hold that number of shares exceeding 15% and, in order to dispose of such shares, would be required
+to sell your shares in open market transactions, potentially at a loss.
+
+ 
+
+Because of our limited resources and the
+significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination.
+If we are unable to complete our initial business combination, our public shareholders may receive only approximately $10.175 per share,
+or less in certain circumstances, on our redemption, and our warrants and rights will expire worthless.
+
+ 
+
+We expect to encounter intense
+competition from other entities having a business objective similar to ours, including private investors (which may be individuals or
+investment partnerships), other blank check companies and other entities, domestic and international, competing for the types of businesses
+we intend to acquire. Many of these individuals and entities are well-established and have extensive experience in identifying and effecting,
+directly or indirectly, acquisitions of companies operating in or providing services to various industries. Many of these competitors
+possess greater technical, human and other resources or more local industry knowledge than we do and our financial resources will be
+relatively limited when contrasted with those of many of these competitors. While we believe there are numerous target businesses we
+could potentially acquire with the net proceeds of this offering and the sale of the private placement warrants, our ability to compete
+with respect to the acquisition of certain target businesses that are sizable will be limited by our available financial resources. This
+inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target businesses. Furthermore, if we
+are obligated to pay cash for the Class A ordinary shares redeemed and, in the event we seek shareholder approval of our initial
+business combination, we make purchases of our Class A ordinary shares, potentially reducing the resources available to us for our
+initial business combination. Any of these obligations may place us at a competitive disadvantage in successfully negotiating a business
+combination. If we are unable to complete our initial business combination, our public shareholders may receive only approximately $10.175
+per share (or less in certain circumstances) on the liquidation of our trust account and our warrants and rights will expire worthless.
+In certain circumstances, our public shareholders may receive less than $10.175 per share on the redemption of their shares. See "Risk
+Factors — If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption
+amount received by shareholders may be less than $10.175 per share" and other risk factors herein.
+
+ 
+
+We believe that, upon the
+closing of this offering, the funds available to us outside of the trust account, will be sufficient to allow us to operate for at least
+the next 15 months (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination
+by the full amount of time); however, we cannot assure you that our estimate is accurate. Of the funds available to us, we could use
+a portion of the funds available to us to pay fees to consultants to assist us with our search for a target business. We could also use
+a portion of the funds as a down payment or to fund a "no-shop" provision (a provision in letters of intent designed to keep
+target businesses from "shopping" around for transactions with other companies on terms more favorable to such target businesses)
+with respect to a particular proposed business combination, although we do not have any current intention to do so. If we entered into
+a letter of intent where we paid for the right to receive exclusivity from a target business and were subsequently required to forfeit
+such funds (whether as a result of our breach or otherwise), we might not have sufficient funds to continue searching for, or conduct
+due diligence with respect to, a target business. If we are unable to complete our initial business combination, our public shareholders
+may receive only approximately $10.175 per share (or less in certain circumstances) on the liquidation of our trust account and our warrants
+and rights will expire worthless. In certain circumstances, our public shareholders may receive less than $10.175 per share on the redemption
+of their shares. See "Risk Factors — If third parties bring claims against us, the proceeds held in the trust account could
+be reduced and the per-share redemption amount received by shareholders may be less than $10.175 per share" and other risk factors
+herein.
+
+ 
+
+ 33
+
+ 
+
+ 
+
+ 
+
+If the net proceeds of this offering and
+the sale of the private placement warrants not being held in the trust account are insufficient, it could limit the amount available
+to fund our search for a target business or businesses and complete our initial business combination and we will depend on loans from
+our sponsor or management team to fund our search, to pay our taxes and to complete our initial business combination.
+
+ 
+
+Of the net proceeds of this
+offering and the sale of the private placement warrants, only approximately $1,350,000 will be available to us initially outside the
+trust account to fund our working capital requirements. In the event that our offering expenses exceed our estimate of $736,000, we may
+fund such excess with funds not to be held in the trust account. In such case, the amount of funds we intend to be held outside the trust
+account would decrease by a corresponding amount. Conversely, in the event that the offering expenses are less than our estimate of $736,000,
+the amount of funds we intend to be held outside the trust account would increase by a corresponding amount. If we are required to seek
+additional capital, we would need to borrow funds from our sponsor, management team or other third parties to operate or may be forced
+to liquidate. Neither our sponsor, members of our management team nor any of their affiliates is under any obligation to advance funds
+to us in such circumstances. Any such advances would be repaid only from funds held outside the trust account or from funds released
+to us upon completion of our initial business combination. Up to $1,150,000 of such loans may be convertible into private placement-equivalent
+warrants at a price of $1.00 per private placement warrant at the option of the lender. If we are unable to complete our initial business
+combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the trust account.
+If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced
+to cease operations and liquidate the trust account. Consequently, our public shareholders may only receive approximately $10.175 per
+share (or less in certain circumstances) on our redemption of our public shares, and our warrants and rights will expire worthless. In
+certain circumstances, our public shareholders may receive less than $10.175 per share on the redemption of their shares. See "Risk
+Factors — If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share
+redemption amount received by shareholders may be less than $10.175 per share" and other risk factors herein.
+
+ 
+
+If third parties bring claims against us,
+the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less than
+$10.175 per share.
+
+ 
+
+Our placing of funds in
+the trust account may not protect those funds from third-party claims against us. Although we will seek to have all vendors, service
+providers (other than our independent auditors), prospective target businesses or other entities with which we do business execute agreements
+with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our
+public shareholders, such parties may not execute such agreements, or even if they execute such agreements they may not be prevented
+from bringing claims against the trust account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility
+or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain advantage with
+respect to a claim against our assets, including the funds held in the trust account. If any third party refuses to execute an agreement
+waiving such claims to the monies held in the trust account, our management will perform an analysis of the alternatives available to
+it and will only enter into an agreement with a third party that has not executed a waiver if management believes that such third party s
+engagement would be significantly more beneficial to us than any alternative.
+
+ 
+
+Examples of possible instances
+where we may engage a third party that refuses to execute a waiver include the engagement of a third party consultant whose particular
+expertise or skills are believed by management to be significantly superior to those of other consultants that would agree to execute
+a waiver or in cases where management is unable to find a service provider willing to execute a waiver. In addition, there is no guarantee
+that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts
+or agreements with us and will not seek recourse against the trust account for any reason. Upon redemption of our public shares, if we
+are unable to complete our initial business combination within the prescribed timeframe, or upon the exercise of a redemption right in
+connection with our initial business combination, we will be required to provide for payment of claims of creditors that were not waived
+that may be brought against us within the 10 years following redemption. Accordingly, the per-share redemption amount received by public
+shareholders could be less than the $10.175 per share initially held in the trust account, due to claims of such creditors. Marcum Bernstein
+ & Pinchuk LLP, our independent registered public accounting firm, and the underwriters of the offering, will not execute agreements
+with us waiving such claims to the monies held in the trust account.
+
+ 
+
+Our sponsor has agreed that
+it will be liable to us if and to the extent any claims by a vendor for services rendered or products sold to us, or a prospective target
+business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below
+(i) $10.175 per public share or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation
+of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay
+taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except
+as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the
+Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will
+not be responsible to the extent of any liability for such third -party claims. We have not independently verified whether our sponsor
+has sufficient funds to satisfy their indemnity obligations and believe that our sponsor s only assets are securities of our company.
+Our sponsor may not have sufficient funds available to satisfy those obligations. We have not asked our sponsor to reserve for such obligations,
+and therefore, no funds are currently set aside to cover any such obligations. As a result, if any such claims were successfully made
+against the trust account, the funds available for our initial business combination and redemptions could be reduced to less than $10.175
+per public share (subject to increase of up to an additional $0.20 per share in the event that our sponsor elects to extend the
+period of time to consummate a business combination by the full six months, as described in more detail in this prospectus). In such
+event, we may not be able to complete our initial business combination, and you would receive such lesser amount per share in connection
+with any redemption of your public shares. None of our officers or directors will indemnify us for claims by third parties including,
+without limitation, claims by vendors and prospective target businesses.
+
+ 
+
+ 34
+
+ 
+
+ 
+
+ 
+
+ 
+
+Our directors may decide not to enforce
+the indemnification obligations of our sponsor, resulting in a reduction in the amount of funds in the trust account available for
+distribution to our public shareholders.
+
+ 
+
+In the event that the proceeds
+in the trust account are reduced below the lesser of (i) $10.175 per public share or (ii) such lesser amount per share held
+in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each
+case net of the interest which may be withdrawn to pay taxes, and our sponsor asserts that it is unable to satisfy its obligations or
+that it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take legal
+action against our sponsor to enforce its indemnification obligations. While we currently expect that our independent directors would
+take legal action on our behalf against our sponsor to enforce its indemnification obligations to us, it is possible that our independent
+directors in exercising their business judgment may choose not to do so in any particular instance. If our independent directors choose
+not to enforce these indemnification obligations, the amount of funds in the trust account available for distribution to our public shareholders
+may be reduced below $10.175 per share.
+
+ 
+
+If, after we distribute the proceeds in
+the trust account to our public shareholders, we file a bankruptcy or insolvency petition or an involuntary bankruptcy petition is filed
+against us that is not dismissed, a bankruptcy or insolvency court may seek to recover such proceeds, and the members of our Board of
+Directors may be viewed as having breached their fiduciary duties to our creditors, thereby exposing the members of our Board of Directors
+and us to claims of punitive damages.
+
+ 
+
+If, after we distribute
+the proceeds in the trust account to our public shareholders, we file a bankruptcy or insolvency petition or an involuntary bankruptcy
+or insolvency petition is filed against us that is not dismissed, any distributions received by shareholders could be viewed under applicable
+debtor/creditor and/or bankruptcy laws as either a "preferential transfer" or a "fraudulent conveyance." As a
+result, a bankruptcy court could seek to recover all amounts received by our shareholders. In addition, our Board of Directors may be
+viewed as having breached its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing itself and us to claims
+of punitive damages, by paying public shareholders from the trust account prior to addressing the claims of creditors.
+
+ 
+
+If,
+before distributing the proceeds in the trust account to our public shareholders, we file a bankruptcy or insolvency
+petition or an involuntary bankruptcy or insolvency petition is filed against us that is not dismissed, the claims of creditors in such
+proceeding may have priority over the claims of our shareholders and the per-share amount that would otherwise be received by our shareholders
+in connection with our liquidation may be reduced.
+
+ 
+
+If, before distributing
+the proceeds in the trust account to our public shareholders, we file a bankruptcy or insolvency petition or an involuntary bankruptcy
+or insolvency petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable
+bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the claims
+of our shareholders. To the extent any bankruptcy claims deplete the trust account, the per-share amount that would otherwise be received
+by our shareholders in connection with our liquidation may be reduced.
+
+ 
+
+If we are deemed to be an investment company
+under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted,
+which may make it difficult for us to complete our initial business combination.
+
+ 
+
+If we are deemed to be an
+investment company under the Investment Company Act, our activities may be restricted, including:
+
+ 
+
+ 
+ 
+ 
+ restrictions
+ on the nature of our investments; and
+
+ 
+ 
+
+ 
+ 
+ 
+ restrictions on the issuance of securities;
+
+ 
+ 
+
+each of which may make it difficult for us to
+complete our initial business combination.
+
+ 
+
+In addition, we may have
+imposed upon us burdensome requirements, including:
+
+ 
+
+ 
+ 
+ 
+ registration as an investment company;
+
+ 
+ 
+
+ 
+ 
+ 
+ adoption of a specific form of corporate structure; and
+
+ 
+ 
+
+ 
+ 
+ 
+ reporting, record keeping, voting, proxy and disclosure
+ requirements and other rules and regulations.
+
+ 
+ 
+
+We do not believe that our
+anticipated principal activities will subject us to the Investment Company Act. The proceeds held in the trust account may be invested
+by the trustee only in U.S. government treasury bills with a maturity of 180 days or less or in money market funds investing solely in
+U.S. Treasuries and meeting certain conditions under Rule 2a-7 under the Investment Company Act. Because the investment of the proceeds
+will be restricted to these instruments, we believe we will meet the requirements for the exemption provided in Rule 3a-1 promulgated
+under the Investment Company Act. If we were deemed to be subject to the Investment Company Act, compliance with these additional regulatory
+burdens would require additional expenses for which we have not allotted funds and may hinder our ability to complete a business combination.
+If we are unable to complete our initial business combination, our public shareholders may receive only approximately $10.175 per share,
+or less in certain circumstances, on the liquidation of our trust account and our warrants and rights will expire worthless.
+
+ 
+
+ 35
+
+ 
+
+ 
+
+ 
+
+Changes in laws or regulations, or a failure
+to comply with any laws and regulations, may adversely affect our business, investments and results of operations.
+
+ 
+
+We are subject to laws and
+regulations enacted by national, regional and local governments. In particular, we will be required to comply with certain SEC and other
+legal requirements. Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consuming and costly.
+Those laws and regulations and their interpretation and application may also change from time to time and those changes could have a
+material adverse effect on our business, investments and results of operations. In addition, a failure to comply with applicable laws
+or regulations, as interpreted and applied, could have a material adverse effect on our business and results of operations.
+
+ 
+
+The British Virgin Islands,
+together with several other non-European Union jurisdictions, have recently introduced legislation aimed at addressing concerns raised
+by the Council of the European Union as to offshore structures engaged in certain activities which attract profits without real economic
+activity. With effect from January 1, 2019, the Economic Substance (Companies and Limited Partnerships) Act, 2018 (the "ESA")
+came into force in the British Virgin Islands introducing certain economic substance requirements for British Virgin Islands tax resident
+companies which are engaged in certain "relevant activities", which in the case of companies incorporated before January 1,
+2019 will apply in respect of financial years commencing June 30, 2019 onwards. However, it is not anticipated that the company
+itself will be subject to any such requirements prior to any business combination and thereafter the company may still remain out of
+scope of the legislation or else be subject to more limited substance requirements. Although it is presently anticipated that the ESA
+will have little material impact on the company or its operations, as the legislation is new and remains subject to further clarification
+and interpretation it is not currently possible to ascertain the precise impact of these legislative changes on the company.
+
+ 
+
+Because we are not limited to a particular
+industry or any specific target businesses with which to pursue our initial business combination, you will be unable to ascertain the
+merits or risks of any particular target business s operations.
+
+ 
+
+ Our efforts to identify
+a prospective initial business combination target will not be limited to a particular industry or sector. While we may pursue an initial
+business combination opportunity in any industry or sector, we intend to complete a business combination with an operating company in
+high-growth industries that apply cutting edge technologies, such as Proptech and Fintech, with a preference for companies that promote
+ESG principles. Except for mainland China, Hong Kong and Macau, there is no restriction on the geographic location for our target search,
+and it is our intent to pursue targets globally, with a particular focus on North America, Europe and Asia where the management team
+and directors have extensive experience and relationships. We will not undertake a business combination with any entity based in or with
+a majority of its operations in mainland China, including Hong Kong and Macau. In addition, we will not, under our amended and restated
+memorandum and articles of association, be permitted to effectuate our initial business combination with another blank check company
+or similar company with nominal operations. Because we have not yet identified or approached any specific target business with respect
+to a business combination, there is no basis to evaluate the possible merits or risks of any particular target business s operations,
+results of operations, cash flows, liquidity, financial condition or prospects. To the extent we complete our initial business combination,
+we may be affected by numerous risks inherent in the business operations with which we combine. For example, if we combine with a financially
+unstable business or an entity lacking an established record of sales or earnings, we may be affected by the risks inherent in the business
+and operations of a financially unstable entity. Although our officers and directors will endeavor to evaluate the risks inherent in
+a particular target business, we cannot assure you that we will properly ascertain or assess all of the significant risk factors or that
+we will have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with
+no ability to control or reduce the chances that those risks will adversely impact a target business. We also cannot assure you that
+an investment in our units will ultimately prove to be more favorable to investors than a direct investment, if such opportunity were
+available, in a business combination target. Accordingly, any shareholders who choose to remain shareholders following the business combination
+could suffer a reduction in the value of their shares. Such shareholders are unlikely to have a remedy for such reduction in value. 
+
+ 
+
+ 36
+
+ 
+
+ 
+
+ 
+
+We may seek acquisition opportunities in
+industries or sectors that may be outside of our management s areas of expertise.
+
+ 
+
+We will consider a business
+combination outside of our management s areas of expertise if a business combination candidate is presented to us and we determine
+that such candidate offers an attractive acquisition opportunity for our company. Although our management will endeavor to evaluate the
+risks inherent in any particular business combination candidate, we cannot assure you that we will adequately ascertain or assess all
+of the significant risk factors. We also cannot assure you that an investment in our units will not ultimately prove to be less favorable
+to investors in this offering than a direct investment, if an opportunity were available, in a business combination candidate. In the
+event we elect to pursue an acquisition outside of the areas of our management s expertise, our management s expertise may
+not be directly applicable to its evaluation or operation, and the information contained in this prospectus regarding the areas of our
+management s expertise would not be relevant to an understanding of the business that we elect to acquire. As a result, our management
+may not be able to adequately ascertain or assess all of the significant risk factors. Accordingly, any shareholders who choose to remain
+shareholders following our initial business combination could suffer a reduction in the value of their shares. Such shareholders are
+unlikely to have a remedy for such reduction in value.
+
+ 
+
+Although we have identified general criteria
+and guidelines that we believe are important in evaluating prospective target businesses, we may enter into our initial business combination
+with a target that does not meet such criteria and guidelines, and as a result, the target business with which we enter into our initial
+business combination may not have attributes entirely consistent with our general criteria and guidelines.
+
+ 
+
+Although we have identified
+general criteria and guidelines for evaluating prospective target businesses, it is possible that a target business with which we enter
+into our initial business combination will not have all of these positive attributes. If we complete our initial business combination
+with a target that does not meet some or all of these guidelines, such combination may not be as successful as a combination with a business
+that does meet all of our general criteria and guidelines. In addition, if we announce a prospective business combination with a target
+that does not meet our general criteria and guidelines, a greater number of shareholders may exercise their redemption rights, which
+may make it difficult for us to meet any closing condition with a target business that requires us to have a minimum net worth or a certain
+amount of cash. In addition, if shareholder approval of the transaction is required by law, or we decide to obtain shareholder approval
+for business or other legal reasons, it may be more difficult for us to attain shareholder approval of our initial business combination
+if the target business does not meet our general criteria and guidelines. If we are unable to complete our initial business combination,
+our public shareholders may receive only approximately $10.175 per share on the liquidation of our trust account and our warrants and
+rights will expire worthless.
+
+ 
+
+We may seek acquisition opportunities with
+a financially unstable business or an entity lacking an established record of revenue or earnings.
+
+ 
+
+To the extent we complete
+our initial business combination with a financially unstable business or an entity lacking an established record of sales or earnings,
+we may be affected by numerous risks inherent in the operations of the business with which we combine. These risks include volatile revenues
+or earnings and difficulties in obtaining and retaining key personnel. Although our officers and directors will endeavor to evaluate
+the risks inherent in a particular target business, we may not be able to properly ascertain or assess all of the significant risk factors
+and we may not have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave
+us with no ability to control or reduce the chances that those risks will adversely impact a target business.
+
+ 
+
+We are not required to obtain an opinion
+from an independent investment banking or from an independent accounting firm, and consequently, you may have no assurance from an independent
+source that the price we are paying for the business is fair to our company from a financial point of view.
+
+ 
+
+Unless we complete our initial
+business combination with an affiliated entity, or our Board of Directors cannot independently determine the fair market value of the
+target business or businesses, we are not required to obtain an opinion from an independent investment banking firm or another independent
+firm that commonly renders valuation opinions or from an independent accounting firm that the price we are paying for a target is fair
+to our company from a financial point of view. If no opinion is obtained, our shareholders will be relying on the business judgment of
+our Board of Directors, which will have significant discretion in choosing the standard used to establish the fair market value of the
+target or targets, and different methods of valuation may vary greatly in outcome from one another. Such standards used will be disclosed
+in our tender offer documents or proxy solicitation materials, as applicable, related to our initial business combination. However, if
+our Board of Directors is unable to determine the fair value of an entity with which we seek to complete an initial business combination
+based on such standards, we will be required to obtain an opinion as described above.
+
+ 
+
+We may issue additional Class A ordinary
+shares or preference shares to complete our initial business combination or under an employee incentive plan after completion of our
+initial business combination. We may also issue Class A ordinary shares upon the conversion of the Class B ordinary shares
+at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions contained
+in our amended and restated memorandum and articles of association. Any such issuances would dilute the interest of our shareholders
+and likely present other risks.
+
+ 
+
+Our amended and restated
+memorandum and articles of association will authorize the issuance of up to 500,000,000 Class A ordinary shares, with no par value,
+50,000,000 Class B ordinary shares, with no par value and 1,000,000 preference shares, with no par value. Immediately after this
+offering, there will be 481,500,000 and 45,375,000 (assuming in each case that the underwriters have not exercised their over-allotment
+option) authorized but unissued Class A and Class B ordinary shares available, respectively, for issuance, which amount takes
+into account shares reserved for issuance upon exercise of outstanding warrants and conversion of outstanding rights but not upon conversion
+of the Class B ordinary shares. Class B ordinary shares are convertible into Class A ordinary shares, initially at a one-for-one
+ratio but subject to adjustment as set forth herein and in our amended and restated memorandum and articles of association. Immediately
+after this offering, there will be no preference shares issued and outstanding.
+
+ 
+
+ 37
+
+ 
+
+ 
+
+ 
+
+We may issue a substantial
+number of additional ordinary shares, and may issue preference shares, in order to complete our initial business combination or under
+an employee incentive plan after completion of our initial business combination. We may also issue Class A ordinary shares upon
+conversion of the Class B ordinary shares at a ratio greater than one-to-one at the time of our initial business combination as
+a result of the anti-dilution provisions contained in our amended and restated memorandum and articles of association. However, our amended
+and restated memorandum and articles of association will provide, among other things, that prior to our initial business combination,
+we may not issue additional ordinary shares that would entitle the holders thereof to (i) receive funds from the trust account or
+(ii) vote on any initial business combination. The issuance of additional ordinary shares or preference shares:
+
+ 
+
+ 
+ 
+ 
+ may significantly dilute the equity interest of investors
+ in this offering;
+
+ 
+ 
+
+ 
+ 
+ 
+ may subordinate the rights of holders of ordinary shares
+ if preference shares are issued with rights senior to those afforded our ordinary shares;
+
+ 
+ 
+
+ 
+ 
+ 
+ could cause a change in control if a substantial number
+ of ordinary shares are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if
+ any, and could result in the resignation or removal of our present officers and directors; and
+
+ 
+ 
+
+ 
+ 
+ 
+ may adversely affect prevailing market prices for our units,
+ ordinary shares, warrants and/or rights.
+
+ 
+ 
+
+Resources could be wasted in researching
+acquisitions that are not completed, which could materially adversely affect subsequent attempts to locate and acquire or merge with
+another business. If we are unable to complete our initial business combination, our public shareholders may receive only approximately
+$10.175 per share, or less than such amount in certain circumstances, on the liquidation of our trust account and our warrants and rights
+will expire worthless.
+
+ 
+
+We anticipate that the investigation
+of each specific target business and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments
+will require substantial management time and attention and substantial costs for accountants, attorneys, consultants and others. If we
+decide not to complete a specific initial business combination, the costs incurred up to that point for the proposed transaction likely
+would not be recoverable. Furthermore, if we reach an agreement relating to a specific target business, we may fail to complete our initial
+business combination for any number of reasons including those beyond our control. Any such event will result in a loss to us of the
+related costs incurred which could materially adversely affect subsequent attempts to locate and acquire or merge with another business.
+If we are unable to complete our initial business combination, our public shareholders may receive only approximately $10.175 per share
+on the liquidation of our trust account and our warrants and rights will expire worthless. See "Risk Factors — If third parties
+bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders
+may be less than $10.175 per share" and other risk factors.
+
+ 
+
+We may engage in a business combination
+with one or more target businesses that have relationships with entities that may be affiliated with our sponsor, officers, directors
+or existing holders which may raise potential conflicts of interest.
+
+ 
+
+In light of the involvement
+of our sponsor, officers and directors with other entities, we may decide to acquire one or more businesses affiliated with our sponsor,
+officers and directors. Our officers and directors also serve as officers and board members for other entities, including, without limitation,
+those described under "Management — Conflicts of Interest". Such entities may compete with us for business combination
+opportunities. Our sponsor, officers and directors are not currently aware of any specific opportunities for us to complete our initial
+business combination with any entities with which they are affiliated, and there have been no preliminary discussions concerning a business
+combination with any such entity or entities. Although we will not be specifically focusing on, or targeting, any transaction with any
+affiliated entities, we would pursue such a transaction if we determined that such affiliated entity met our criteria for a business
+combination as set forth in "Proposed Business — Effecting Our Initial Business Combination — Selection of a target
+business and structuring of our initial business combination" and such transaction was approved by a majority of our disinterested
+directors. Despite our agreement to obtain an opinion from an independent investment banking firm or another independent firm that commonly
+renders valuation opinions or an independent accounting firm, regarding the fairness to our company from a financial point of view of
+a business combination with one or more domestic or international businesses affiliated with our officers, directors or existing holders,
+potential conflicts of interest still may exist and, as a result, the terms of the business combination may not be as advantageous to
+our public shareholders as they would be absent any conflicts of interest.
+
+ 
+
+ 38
+
+ 
+
+ 
+
+ 
+
+Affiliates of our Sponsor may be involved
+in other blank check companies like ours and may direct potential targets to those companies rather than to us.
+
+ 
+
+Affiliates of our Sponsor
+may invest in or be involved in the management of other SPACs. SPACs related to such affiliates may compete with us for acquisition opportunities.
+Because such affiliates do not owe us a fiduciary duty, they may direct opportunities to the other SPACs with which they have a relationship
+rather than to us.
+
+ 
+
+Since our sponsor, officers and directors
+will lose their entire investment in us if our initial business combination is not completed, a conflict of interest may arise in determining
+whether a particular business combination target is appropriate for our initial business combination.
+
+ 
+
+On June 28, 2021, our sponsor
+purchased an aggregate of 5,750,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.004 per share. On
+March 24, 2022, we canceled 431,250 of such founder shares for no consideration, resulting in 5,318,750
+founder shares remaining outstanding. Prior to the initial investment in the company of $25,000 by our sponsor, the company
+had no assets, tangible or intangible. As such, our sponsor will own 20% of our issued and outstanding shares after this offering (assuming
+it does not purchase units in this offering and excluding the Representative s shares). If we increase or decrease the size of
+the offering, we will effect a capitalization or share surrender or redemption or other appropriate mechanism, as applicable, immediately
+prior to the consummation of the offering in such amount as to maintain the ownership of our sponsor prior to this offering at 20% of
+our issued and outstanding ordinary shares upon the consummation of this offering (excluding the Representative s shares).
+The founder shares will be worthless if we do not complete an initial business combination. In addition, our sponsor has committed to
+purchase an aggregate of 8,450,000 (or 9,421,250 if the underwriters over-allotment option is exercised in full) private placement
+warrants at a price of $1.00 per warrant for a purchase price of $8,450,000 in the aggregate or $9,421,250 in the aggregate if the underwriters 
+over-allotment option is exercised in full). Each private placement warrants will be identical to the warrants sold in this offering,
+except as described in this prospectus. The private placement warrants will be sold in a private placement that will close simultaneously
+with the closing of this offering, including the over-allotment option, as applicable. There will be no redemption rights or liquidating
+distributions from the trust account with respect to the founder shares or private placement warrants. The warrants will expire worthless
+if we do not consummate a business combination within the allotted 15 months period (or up to 21 months from the completion of this offering
+if we extend the period of time to consummate a business combination by the full amount of time).
+
+ 
+
+The founder shares are identical
+to the Class A ordinary shares included in the units being sold in this offering except that (i) holders of the founder shares
+have the right to vote on the election of directors prior to our initial business combination, (ii) the founder shares are subject
+to certain transfer restrictions, (iii) our sponsor, officers and directors have entered into a letter agreement with us, pursuant
+to which they have agreed (A) to waive their redemption rights with respect to their founder shares and public shares in connection
+with the completion of our initial business combination and (B) to waive their rights to liquidating distributions from the trust
+account with respect to their founder shares if we fail to complete our initial business combination within 15 months from the closing
+of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination
+by the full amount of time) (although they will be entitled to liquidating distributions from the trust account with respect to any public
+shares they hold if we fail to complete our initial business combination within the prescribed time frame) and (iv) the founder
+shares will automatically convert into our Class A ordinary shares at the time of our initial business combination, or earlier at
+the option of the holder, on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described herein
+and in our amended and restated memorandum and articles of association.
+
+ 
+
+The personal and financial
+interests of our officers and directors may influence their motivation in identifying and selecting a target business combination, completing
+an initial business combination and influencing the operation of the business following the initial business combination.
+
+ 
+
+We may issue notes or other debt securities,
+or otherwise incur substantial debt, to complete a business combination, which may adversely affect our leverage and financial condition
+and thus negatively impact the value of our shareholders investment in us.
+
+ 
+
+Although we have no commitments
+as of the date of this prospectus to issue any notes or other debt securities, or to otherwise incur outstanding debt following this
+offering, we may choose to incur substantial debt to complete our initial business combination. We have agreed that we will not incur
+any indebtedness unless we have obtained from the lender a waiver of any right, title, interest or claim of any kind in or to the monies
+held in the trust account. As such, no issuance of debt will affect the per-share amount available for redemption from the trust account.
+Nevertheless, the incurrence of debt could have a variety of negative effects, including:
+
+ 
+
+ 
+ 
+ 
+ default and
+ foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt obligations;
+
+ 
+ 
+
+ 
+ 
+ 
+ acceleration of our obligations to repay the indebtedness
+ even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain
+ financial ratios or reserves without a waiver or renegotiation of that covenant;
+
+ 
+ 
+
+ 
+ 
+ 
+ our immediate payment of all principal and accrued interest,
+ if any, if the debt security is payable on demand;
+
+ 
+ 
+
+ 
+ 
+ 
+ our inability to obtain necessary additional financing
+ if the debt security contains covenants restricting our ability to obtain such financing while the debt security is outstanding;
+
+ 
+ 
+
+ 
+ 
+ 
+ our inability to pay dividends on our ordinary shares;
+
+ 
+ 
+
+ 39
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ using a substantial portion of our cash flow to pay principal
+ and interest on our debt, which will reduce the funds available for dividends on our ordinary shares if declared, expenses, capital
+ expenditures, acquisitions and other general corporate purposes;
+
+ 
+ 
+
+ 
+ 
+ 
+ limitations on our flexibility in planning for and reacting
+ to changes in our business and in the industry in which we operate;
+
+ 
+ 
+
+ 
+ 
+ 
+ increased vulnerability to adverse changes in general economic,
+ industry and competitive conditions and adverse changes in government regulation; and
+
+ 
+ 
+
+ 
+ 
+ 
+ limitations on our ability to borrow additional amounts
+ for expenses, capital expenditures, acquisitions, debt service requirements, execution of our strategy and other purposes and other
+ disadvantages compared to our competitors who have less debt.
+
+ 
+ 
+
+We may only be able to complete one business
+combination with the proceeds of this offering and the sale of the private placement warrants, which will cause us to be solely dependent
+on a single business which may have a limited number of products or services. This lack of diversification may negatively impact our
+operations and profitability.
+
+ 
+
+Of the net proceeds from
+this offering and the sale of the private placement warrants, $188,237,500 (or $216,473,125 if the underwriters over-allotment
+option is exercised in full) will be available to complete our business combination and pay related fees and expenses, which includes
+up to approximately $6,475,000 (or up to $7,446,250 if the over-allotment option is exercised in full, for the payment of deferred underwriting
+commissions).
+
+ 
+
+We may effectuate our initial
+business combination with a single target business or multiple target businesses simultaneously or within a short period of time. However,
+we may not be able to effectuate our initial business combination with more than one target business because of various factors, including
+the existence of complex accounting issues and the requirement that we prepare and file pro forma financial statements with the SEC that
+present operating results and the financial condition of several target businesses as if they had been operated on a combined basis.
+By completing our initial business combination with only a single entity our lack of diversification may subject us to numerous economic,
+competitive and regulatory risks. Further, we would not be able to diversify our operations or benefit from the possible spreading of
+risks or offsetting of losses, unlike other entities which may have the resources to complete several business combinations in different
+industries or different areas of a single industry. Accordingly, the prospects for our success may be:
+
+ 
+
+ 
+ 
+ 
+ solely dependent upon the performance of a single business,
+ property or asset; or
+
+ 
+ 
+
+ 
+ 
+ 
+ dependent upon the development or market acceptance of
+ a single or limited number of products, processes or services.
+
+ 
+ 
+
+This lack of diversification
+may subject us to numerous economic, competitive and regulatory risks, any or all of which may have a substantial adverse impact upon
+the particular industry in which we may operate subsequent to our initial business combination.
+
+ 
+
+We may attempt to simultaneously complete
+business combinations with multiple prospective targets, which may hinder our ability to complete our initial business combination and
+give rise to increased costs and risks that could negatively impact our operations and profitability.
+
+ 
+
+If we determine to simultaneously
+acquire several businesses that are owned by different sellers, we will need for each of such sellers to agree that our purchase of its
+business is contingent on the simultaneous closings of the other business combinations, which may make it more difficult for us, and
+delay our ability, to complete our initial business combination. With multiple business combinations, we could also face additional risks,
+including additional burdens and costs with respect to possible multiple negotiations and due diligence investigations (if there are
+multiple sellers) and the additional risks associated with the subsequent assimilation of the operations and services or products of
+the acquired companies in a single operating business. If we are unable to adequately address these risks, it could negatively impact
+our profitability and results of operations.
+
+ 
+
+ 40
+
+ 
+
+ 
+
+ 
+
+We do not have a specified maximum redemption
+threshold. The absence of such a redemption threshold may make it possible for us to complete a business combination with which a substantial
+majority of our shareholders have redeemed their Class A ordinary shares.
+
+ 
+
+Our amended and restated
+memorandum and articles of association will not provide a specified maximum redemption threshold, except that in no event will we redeem
+our public shares in an amount that would cause our net tangible assets, after payment of the deferred underwriting commissions, to be
+less than $5,000,001 upon consummation of our initial business combination (such that we are not subject to the SEC s "penny
+stock" rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial
+business combination. As a result, we may be able to complete our initial business combination even though a substantial majority of
+our public shareholders do not agree with the transaction and have redeemed their shares or, if we seek shareholder approval of our initial
+business combination and do not conduct redemptions in connection with our initial business combination pursuant to the tender offer
+rules, have entered into privately negotiated agreements to sell their shares to our sponsor, officers, directors, advisors or their
+affiliates. In the event the aggregate cash consideration we would be required to pay for all Class A ordinary shares that are validly
+submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination
+exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, all Class A
+ordinary shares submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate business
+combination.
+
+ 
+
+In order to effectuate an initial business
+combination, blank check companies have, in the recent past, amended various provisions of their charters and modified governing instruments.
+We cannot assure you that we will not seek to amend our amended and restated memorandum and articles of association or governing instruments
+in a manner that will make it easier for us to complete our initial business combination that our shareholders may not support.
+
+ 
+
+In order to effectuate a
+business combination, blank check companies have, in the past, amended various provisions of their charters and modified governing instruments.
+For example, blank check companies have amended the definition of business combination, increased redemption thresholds and extended
+the period of time in which it had to consummate a business combination. We cannot assure you that we will not seek to amend our amended
+and restated memorandum and articles of association or governing instruments or extend the time in which we have to consummate a business
+combination through amending our amended and restated memorandum and articles of association, each of which will require a resolution
+passed by holders if at least a majority of our ordinary shares who are eligible to vote and attend and vote in a general meeting of
+our shareholders.
+
+ 
+
+The provisions of our amended and restated
+memorandum and articles of association that relate to our pre-initial business combination activity (and corresponding provisions of
+the agreement governing the release of funds from our trust account), including an amendment to permit us to withdraw funds from the
+trust account such that the per share amount investors will receive upon any redemption or liquidation is substantially reduced or eliminated,
+may be amended with the approval of holders of at least a majority of our ordinary shares who attend and vote in a general meeting, which
+is a lower amendment threshold than that of some other blank check companies. It may be easier for us, therefore, to amend our amended
+and restated memorandum and articles of association and the trust agreement to facilitate the completion of an initial business combination
+that some of our shareholders may not support.
+
+ 
+
+Some other blank check companies
+have a provision in their charter which prohibits the amendment of certain of its provisions, including those which relate to a company s
+pre-initial business combination activity, without approval by a certain percentage of our shareholders. In those companies, amendment
+of these provisions requires approval by between 90% and 100% of the company s public shareholders. Our amended and restated memorandum
+and articles of association will provide that any of its provisions, including those related to pre-initial business combination activity
+(including the requirement to deposit proceeds of this offering and the private placement of the private placement warrants into the
+trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public shareholders
+as described herein and in our amended and restated memorandum and articles of association or an amendment to permit us to withdraw funds
+from the trust account such that the per share amount investors will receive upon any redemption or liquidation is substantially reduced
+or eliminated) may be amended if approved by holders of at least a majority of our ordinary shares who attend and vote in a general meeting,
+and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved
+by holders of a majority of our ordinary shares. Should our insiders vote all their shares in favor of any such amendment, such amendment
+would not be approved regardless how public shares are voted. We may not issue additional securities that can vote on amendments to our
+amended and restated memorandum and articles of association. Our insiders, which will collectively beneficially own 20% of our ordinary
+shares upon the closing of this offering (assuming it does not purchase any units in this offering and excluding the Representative Shares),
+will participate in any vote to amend our amended and restated memorandum and articles of association and/or trust agreement and will
+have the discretion to vote in any manner they choose. As a result, we may be able to amend the provisions of our amended and restated
+memorandum and articles of association which govern our pre-business combination behavior more easily than some other blank check companies,
+and this may increase our ability to complete a business combination with which you do not agree. Our shareholders may pursue remedies
+against us for any breach of our amended and restated memorandum and articles of association.
+
+ 
+
+ 41
+
+ 
+
+ 
+
+ 
+
+We may be unable to obtain additional financing
+to complete our initial business combination or to fund the operations and growth of a target business, which could compel us to restructure
+or abandon a particular business combination.
+
+ 
+
+Although we believe that
+the net proceeds of this offering and the sale of the private placement warrants will be sufficient to allow us to complete our initial
+business combination, because we have not yet identified any prospective target business we cannot ascertain the capital requirements
+for any particular transaction. If the net proceeds of this offering and the sale of the private placement warrants prove to be insufficient,
+either because of the size of our initial business combination, the depletion of the available net proceeds in search of a target business,
+the obligation to redeem for cash a significant number of shares from shareholders who elect redemption in connection with our initial
+business combination or the terms of negotiated transactions to purchase shares in connection with our initial business combination,
+we may be required to seek additional financing or to abandon the proposed business combination. We cannot assure you that such financing
+will be available on acceptable terms, if at all. To the extent that additional financing proves to be unavailable when needed to complete
+our initial business combination, we would be compelled to either restructure the transaction or abandon that particular business combination
+and seek an alternative target business candidate. In addition, even if we do not need additional financing to complete our initial business
+combination, we may require such financing to fund the operations or growth of the target business. The failure to secure additional
+financing could have a material adverse effect on the continued development or growth of the target business. None of our officers, directors
+or shareholders is required to provide any financing to us in connection with or after our initial business combination. If we are unable
+to complete our initial business combination, our public shareholders may only receive approximately $10.175 per share on the liquidation
+of our trust account, and our warrants and rights will expire worthless. In certain circumstances, our public shareholders may receive
+less than $10.175 per share on the redemption of their shares. See "Risk Factors — If third parties bring claims against
+us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less
+than $10.175 per share" and other risk factors below.
+
+ 
+
+Our sponsor will control the election of
+our Board of Directors until consummation of our initial business combination and will hold a substantial interest in us. As a result,
+it will elect all of our directors and may exert a substantial influence on actions requiring shareholder vote, potentially in a manner
+that you do not support.
+
+ 
+
+Upon the closing of this
+offering, our sponsor will own 20% of our issued and outstanding ordinary shares (assuming it does not purchase any units in this offering
+and excluding the Representative Shares). In addition, the founder shares, all of which are held by our sponsor, will entitle our sponsor
+to elect all of our directors prior to our initial business combination. Holders of our public shares will have no right to vote on the
+election of directors during such time. These provisions of our amended and restated memorandum and articles of association with class
+rights may not be amended without a resolution passed by holders of at least a majority of the total number of ordinary shares of that
+class that have voted and are entitled to vote thereon. As a result, you will not have any influence over the election of directors prior
+to our initial business combination.
+
+ 
+
+Neither our sponsor nor,
+to our knowledge, any of our officers or directors, have any current intention to purchase additional securities, other than as disclosed
+in this prospectus. Factors that would be considered in making such additional purchases would include consideration of the current trading
+price of our Class A ordinary shares. In addition, as a result of its substantial ownership in our company, our sponsor may exert
+a substantial influence on other actions requiring a shareholder vote, potentially in a manner that you do not support, including amendments
+to our amended and restated memorandum and articles of association and approval of major corporate transactions. If our sponsor purchases
+any additional ordinary shares in the aftermarket or in privately negotiated transactions, this would increase its influence over these
+actions. Accordingly, our sponsor will exert significant influence over actions requiring a shareholder vote at least until the completion
+of our initial business combination.
+
+ 
+
+Because we must furnish our shareholders
+with target business financial statements, we may lose the ability to complete an otherwise advantageous initial business combination
+with some prospective target businesses.
+
+ 
+
+The federal proxy rules require
+that a proxy statement with respect to a vote on a business combination meeting certain financial significance tests include historical
+and/or pro forma financial statement disclosure in periodic reports. We will include the same financial statement disclosure in connection
+with our tender offer documents, whether or not they are required under the tender offer rules. These financial statements may be required
+to be prepared in accordance with, or be reconciled to, accounting principles generally accepted in the United States of America, or
+U.S. GAAP, or international financing reporting standards as issued by the International Accounting Standards Board, or IFRS, depending
+on the circumstances and the historical financial statements may be required to be audited in accordance with the standards of the Public
+Company Accounting Oversight Board (U.S.), or PCAOB. These financial statement requirements may limit the pool of potential target businesses
+we may acquire because some targets may be unable to provide such statements in time for us to disclose such statements in accordance
+with federal proxy rules and complete our initial business combination within the prescribed time frame.
+
+ 
+
+ 42
+
+ 
+
+ 
+
+ 
+
+Compliance obligations under the Sarbanes-Oxley
+Act may make it more difficult for us to effectuate our initial business combination, require substantial financial and management resources,
+and increase the time and costs of completing an acquisition.
+
+ 
+
+Section 404 of the
+Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls beginning with our Annual Report on Form 10-K
+for the year ending December 31, 2022. Only in the event we are deemed to be a large accelerated filer or an accelerated filer will
+we be required to comply with the independent registered public accounting firm attestation requirement on our internal control over
+financial reporting. Further, for as long as we remain an emerging growth company, we will not be required to comply with the independent
+registered public accounting firm attestation requirement on our internal control over financial reporting. The fact that we are a blank
+check company makes compliance with the requirements of the Sarbanes-Oxley Act particularly burdensome on us as compared to other public
+companies because a target company with which we seek to complete our initial business combination may not be in compliance with the
+provisions of the Sarbanes-Oxley Act regarding adequacy of its internal controls. The development of the internal control of any such
+entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such acquisition.
+
+ 
+
+A majority of our directors and officers
+currently live outside the United States and, after a business combination, it is possible that a majority of our directors and officers
+and all of our assets will be located outside the United States; therefore, investors may not be able to enforce federal securities laws
+or their other legal rights.
+
+ 
+
+A majority of our directors
+and officers currently reside outside of the United States and, after a business combination, it is possible that a majority of our directors
+and officers and all of our assets will be located outside of the United States. As a result, it may be difficult, or in some cases not
+possible, for investors in the United States to enforce their legal rights, to effect service of process upon all of our directors or
+officers or to enforce judgments of United States courts predicated upon civil liabilities and criminal penalties on our directors and
+officers under United States laws.
+
+ 
+
+In particular, investors
+should be aware that there is uncertainty as to whether the courts of the British Virgin Islands or any other applicable jurisdiction
+would recognize and enforce judgements of U.S. courts obtained against us or our directors or officers predicted upon the civil liability
+provisions of the securities laws of the United States or any state in the United States or entertain original actions brought in the
+British Virgin Islands or any other applicable jurisdiction s courts against us or our directors or officers predicated upon the
+securities laws of the United States or any state.
+
+ 
+
+If we effect a business combination with
+a company located outside of the United States, the laws applicable to such company will likely govern all of our material agreements
+and we may not be able to enforce our legal rights.
+
+ 
+
+If we effect a business
+combination with a company located outside of the United States, the laws of the country in which such company operates will govern almost
+all of the material agreements relating to its operations. We cannot assure you that the target business will be able to enforce any
+of its material agreements or that remedies will be available in this new jurisdiction. The system of laws and the enforcement of existing
+laws in such jurisdiction may not be as certain in implementation and interpretation as in the United States The inability to enforce
+or obtain a remedy under any of our future agreements could result in a significant loss of business, business opportunities or capital.
+Additionally, if we acquire a company located outside of the United States, it is likely that substantially all of our assets would be
+located outside of the United States and some of our officers and directors might reside outside of the United States As a result, it
+may not be possible for investors in the United States to enforce their legal rights, to effect service of process upon our directors
+or officers or to enforce judgments of United States courts predicated upon civil liabilities and criminal penalties of our directors
+and officers under Federal securities laws.
+
+ 
+
+If relations between the United States
+and foreign governments deteriorate, it could cause potential target businesses or their goods and services to become less attractive.
+
+ 
+
+The relationship between
+the United States and foreign governments could be subject to sudden fluctuation and periodic tension. For instance, the United States
+may announce its intention to impose quotas on certain imports. Such import quotas may adversely affect political relations between the
+two countries and result in retaliatory countermeasures by the foreign government in industries that may affect our ultimate target business.
+
+ 
+
+Changes in political conditions
+in foreign countries and changes in the state of U.S. relations with such countries are difficult to predict and could adversely affect
+our operations or cause potential target businesses or their goods and services to become less attractive. Because we are not limited
+to any specific industry, there is no basis for investors in this offering to evaluate the possible extent of any impact on our ultimate
+operations if relations are strained between the United States and a foreign country in which we acquire a target business or move
+our principal manufacturing or service operations.
+
+ 
+
+ 43
+
+ 
+
+ 
+
+ 
+
+The ability of our public shareholders
+to exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business combination
+would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares.
+
+ 
+
+If our initial business
+combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have
+a minimum amount of cash at closing, the probability that our initial business combination would be unsuccessful is increased. If our
+initial business combination is unsuccessful, you would not receive your pro rata portion of the trust account until we liquidate the
+trust account. If you are in need of immediate liquidity, you could attempt to sell your shares in the open market; however, at such
+time our shares may trade at a discount to the pro rata amount per share in the trust account. In either situation, you may suffer a
+material loss on your investment or lose the benefit of funds expected in connection with our redemption until we liquidate or you are
+able to sell your shares in the open market.
+
+ 
+
+Currency policies may harm a target business 
+ability to succeed in the international markets.
+
+ 
+
+In the event we acquire
+a non-U.S. target, all revenues and income would likely be received in a foreign currency, the dollar equivalent of our net assets and
+distributions, if any, could be adversely affected by reductions in the value of the local currency. The value of the currencies in our
+target regions fluctuate and are affected by, among other things, changes in political and economic conditions.
+
+ 
+
+Any change in the relative
+value of such currency against our reporting currency may affect the attractiveness of any target business or, following consummation
+of our initial business combination, our financial condition and results of operations. If a currency appreciates in value against the
+dollar prior to the consummation of our initial business combination, the cost of a target business as measured in dollars will increase,
+which may make it less likely that we can consummate such transaction.
+
+ 
+
+ Certain economies in Asia are experiencing
+substantial inflationary pressures which may prompt governments to take action to control the growth of the economy and inflation that
+could lead to a significant decrease in our profitability following our initial business combination.
+
+ 
+
+While many of the economies
+in Asia have experienced rapid growth over the last two decades, certain economies are experiencing inflationary pressures. As governments
+take steps to address the current inflationary pressures, there may be significant changes in the availability of bank credits, interest
+rates, limitations on loans, restrictions on currency conversions and foreign investment. There also may be imposition of price controls.
+
+ 
+
+If prices for the products
+of our ultimate target business rise at a rate that is insufficient to compensate for the rise in the costs of supplies, it may have
+an adverse effect on our profitability. If these or other similar restrictions are imposed by a government to influence the economy,
+it may lead to a slowing of economic growth. Because we are not limited to any specific industry, the ultimate industry that we operate
+in may be affected more severely by such a slowing of economic growth.
+
+ 
+
+Many industries in Asia are subject to
+government regulations that limit or prohibit foreign investments in those industries, which may limit the potential number of acquisition
+candidates.
+
+ 
+
+Governments in many Asian
+countries have imposed regulations that limit foreign investors equity ownership or prohibit foreign investments altogether in
+companies that operate in certain industries. As a result, the number of potential acquisition candidates available to us may be limited
+or our ability to grow and sustain the business, which we ultimately acquire will be limited.
+
+ 
+
+If a country in Asia enacts regulations
+in industry segments that forbid or restrict foreign investment, our ability to consummate our initial business combination could be
+severely impaired.
+
+ 
+
+Many of the rules and regulations
+that companies face concerning foreign ownership are not explicitly communicated. If new laws or regulations forbid or limit foreign
+investment in industries in which we want to complete our initial business combination, they could severely impair our candidate pool
+of potential target businesses. In addition, if the relevant central and local authorities find us or the target business with which
+we ultimately complete our initial business combination to be in violation of any existing or future laws or regulations, they would
+have broad discretion in dealing with such a violation, including, without limitation:
+
+ 
+
+ levying
+ fines;
+
+ 
+
+ revoking
+ our business and other licenses;
+
+ 
+
+ requiring
+ that we restructure our ownership or operations; and
+
+ 
+
+ requiring
+ that we discontinue any portion or all of our business.
+
+ 
+
+ 44
+
+ 
+
+ 
+
+ 
+
+Any of the above could have
+an adverse effect on our company post-business combination and could materially reduce the value of your investment.
+
+ 
+
+Corporate governance standards in Asia
+may not be as strict or developed as in the United States and such weakness may hide issues and operational practices that are detrimental
+to a target business.
+
+ 
+
+General corporate governance
+standards in some countries are weak in that they do not prevent business practices that cause unfavorable related party transactions,
+over-leveraging, improper accounting, family company interconnectivity and poor management. Local laws often do not go far enough to
+prevent improper business practices.
+
+ 
+
+Therefore, shareholders
+may not be treated impartially and equally as a result of poor management practices, asset shifting, conglomerate structures that result
+in preferential treatment to some parts of the overall company, and cronyism. The lack of transparency and ambiguity in the regulatory
+process also may result in inadequate credit evaluation and weakness that may precipitate or encourage financial crisis.
+
+ 
+
+In our evaluation of a business
+combination we will have to evaluate the corporate governance of a target and the business environment, and in accordance with United States
+laws for reporting companies take steps to implement practices that will cause compliance with all applicable rules and accounting practices.
+Notwithstanding these intended efforts, there may be endemic practices and local laws that could add risk to an investment we ultimately
+make and that result in an adverse effect on our operations and financial results.
+
+ 
+
+If we are unable to consummate our initial
+business combination within 15 months of the closing of this offering (or up to 21 months from the closing of this offering if we extend
+the period of time to consummate a business combination by the full amount of time), our public shareholders may be forced to wait beyond
+such 15 months (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination
+by the full amount of time) before redemption from our trust account.
+
+ 
+
+If we are unable to consummate
+our initial business combination within 15 months from the closing of this offering (or up to 21 months from the closing of this offering
+if we extend the period of time to consummate a business combination by the full amount of time), we will distribute the aggregate amount
+then on deposit in the trust account (less up to $50,000 of the net interest earned thereon to pay dissolution expenses), pro rata to
+our public shareholders by way of redemption and cease all operations except for the purposes of winding up of our affairs, as further
+described herein. Any redemption of public shareholders from the trust account shall be effected automatically by function of our amended
+and restated memorandum and articles of association prior to any voluntary winding up. If we are required to windup, liquidate the trust
+account and distribute such amount therein, pro rata, to our public shareholders, as part of any liquidation process, such winding up,
+liquidation and distribution must comply with the applicable provisions of the Companies Act. In that case, investors may be forced to
+wait beyond the initial 15 months (or up to 21 months from the closing of this offering if we extend the period of time to consummate
+a business combination by the full amount of time) before the redemption proceeds of our trust account become available to them and they
+receive the return of their pro rata portion of the proceeds from our trust account. We have no obligation to return funds to investors
+prior to the date of our redemption or liquidation unless we consummate our initial business combination prior thereto and only then
+in cases where investors have sought to redeem their Class A ordinary shares. Only upon our redemption or any liquidation will public
+shareholders be entitled to distributions if we are unable to complete our initial business combination.
+
+ 
+
+We may not hold an annual meeting of shareholders
+until after the consummation of our initial business combination. Our public shareholders will not have the right to elect directors
+prior to the consummation of our initial business combination.
+
+ 
+
+In accordance with NASDAQ
+corporate governance requirements, we are not required to hold an annual meeting until no later than one year after our first fiscal
+year end following our listing on NASDAQ. There is no requirement under the Companies Act for us to hold annual or general meetings or
+elect directors. Until we hold an annual meeting of shareholders, public shareholders may not be afforded the opportunity to discuss
+company affairs with management. In addition, as holders of our Class A ordinary shares, our public shareholders will not have the
+right to vote on the election of directors prior to consummation of our initial business combination. 
+
+ 
+
+ 45
+
+ 
+
+ 
+
+ 
+
+Risks Relating to the Post-Business Combination
+Company
+
+ 
+
+We may face risks related to financial technology businesses.
+
+ 
+
+Business combinations with
+financial technology businesses may involve special considerations and risks. If we complete our initial business combination with a
+financial technology business, we will be subject to the following risks, any of which could be detrimental to us and the business we
+acquire:
+
+ 
+
+ 
+ 
+ 
+ If the company or business we acquire provides products
+ or services which relate to the facilitation of financial transactions, such as funds or securities settlement system, and such product
+ or service fails or is compromised, we may be subject to claims from both the firms to whom we provide our products and services
+ and the clients they serve;
+
+ 
+ 
+
+ 
+ 
+ 
+ If we are unable to keep pace with evolving technology
+ and changes in the financial services industry, our revenues and future prospects may decline;
+
+ 
+ 
+
+ 
+ 
+ 
+ Our ability to provide financial technology products and
+ services to customers may be reduced or eliminated by regulatory changes;
+
+ 
+ 
+
+ 
+ 
+ 
+ Any business or company we acquire could be vulnerable
+ to cyberattack or theft of individual identities or personal data;
+
+ 
+ 
+
+ 
+ 
+ 
+ Difficulties with any products or services we provide could
+ damage our reputation and business;
+
+ 
+ 
+
+ 
+ 
+ 
+ A failure to comply with privacy regulations could adversely
+ affect relations with customers and have a negative impact on business;
+
+ 
+ 
+
+ 
+ 
+ 
+ We may not be able to protect our intellectual property
+ and we may be subject to infringement claims.
+
+ 
+ 
+
+ Any of the foregoing
+could have an adverse impact on our operations following a business combination. However, efforts in identifying prospective target businesses
+will not be limited to a particular industry or country, although we intend to focus on targets in the New Economy Sectors, with a preference
+for companies that promote ESG principles. Except for mainland China, Hong Kong and Macau, there is no restriction on the geographic
+location for our target search, and it is our intent to pursue targets globally, with a particular focus on North America, Europe and
+Asia where the management team and directors have extensive experience and relationships. We will not undertake a business combination
+with any entity based in or with a majority of its operations in mainland China, including Hong Kong and Macau. Accordingly, if we
+acquire a target business in another industry, these risks will likely not affect us and we will be subject to other risks attendant
+with the specific industry in which we operate or target business which we acquire, none of which can be presently ascertained. 
+
+ 
+
+Subsequent to the completion of our initial
+business combination, we may be required to take write-downs or write-offs, restructuring and impairment or other charges that could
+have a significant negative effect on our financial condition, results of operations and our share price, which could cause you to lose
+some or all of your investment.
+
+ 
+
+Even if we conduct extensive
+due diligence on a target business with which we combine, we cannot assure you that this diligence will surface all material issues that
+may be present inside a particular target business, that it would be possible to uncover all material issues through a customary amount
+of due diligence, or that factors outside of the target business and outside of our control will not later arise. As a result of these
+factors, we may be forced to later write-down or write-off assets, restructure our operations, or incur impairment or other charges that
+could result in our reporting losses. Even if our due diligence successfully identifies certain risks, unexpected risks may arise and
+previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though these charges may be
+non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to
+negative market perceptions about us or our securities. In addition, charges of this nature may cause us to violate net worth or other
+covenants to which we may be subject as a result of assuming pre-existing debt held by a target business or by virtue of our obtaining
+post-combination debt financing.
+
+ 
+
+Accordingly, any shareholders
+who choose to remain shareholders following the business combination could suffer a reduction in the value of their shares. Such shareholders
+are unlikely to have a remedy for such reduction in value.
+
+ 
+
+Our ability to successfully effect our
+initial business combination and to be successful thereafter will be totally dependent upon the efforts of our key personnel, some of
+whom may join us following our initial business combination. The loss of key personnel could negatively impact the operations and profitability
+of our post-combination business.
+
+ 
+
+Our ability to successfully
+effect our initial business combination is dependent upon the efforts of our key personnel. The role of our key personnel in the target
+business, however, cannot presently be ascertained. Although some of our key personnel may remain with the target business in senior
+management or advisory positions following our initial business combination, it is likely that some or all of the management of the target
+business will remain in place. While we intend to closely scrutinize any individuals we engage after our initial business combination,
+we cannot assure you that our assessment of these individuals will prove to be correct. These individuals may be unfamiliar with the
+requirements of operating a company regulated by the SEC, which could cause us to have to expend time and resources helping them become
+familiar with such requirements.
+
+ 
+
+ 46
+
+ 
+
+ 
+
+ 
+
+Our management may not be able to maintain
+control of a target business after our initial business combination. We cannot provide assurance that, upon loss of control of a target
+business, new management will possess the skills, qualifications or abilities necessary to profitably operate such business.
+
+ 
+
+We may structure a business
+combination so that the post-transaction company in which our public shareholders own shares will own less than 100% of the equity interests
+or assets of a target business, but we will only complete such business combination if the post-transaction company owns or acquires
+50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient
+for us not to be required to register as an investment company under the Investment Company Act. We will not consider any transaction
+that does not meet such criteria. Even if the post-transaction company owns 50% or more of the voting securities of the target, our shareholders
+prior to the business combination may collectively own a minority interest in the post business combination company, depending on valuations
+ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a
+substantial number of new ordinary shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire
+a 100% interest in the target. However, as a result of the issuance of a substantial number of new ordinary shares, our shareholders
+immediately prior to such transaction could own less than a majority of our issued and outstanding ordinary shares subsequent to such
+transaction. In addition, other minority shareholders may subsequently combine their holdings resulting in a single person or group obtaining
+a larger share of the company s stock than we initially acquired. Accordingly, this may make it more likely that our management
+will not be able to maintain our control of the target business.
+
+ 
+
+We may reincorporate in another jurisdiction
+in connection with our initial business combination and such reincorporation may result in taxes imposed on shareholders.
+
+ 
+
+We may, in connection with
+our initial business combination and subject to requisite shareholder approval under the Companies Act, reincorporate in the jurisdiction
+in which the target company or business is located. The transaction may require a shareholder to recognize taxable income in the jurisdiction
+in which the shareholder is a tax resident or in which its members are resident if it is a tax transparent entity. We do not intend to
+make any cash distributions to shareholders to pay such taxes. Shareholders may be subject to withholding taxes or other taxes with respect
+to their ownership of us after the reincorporation.
+
+ 
+
+We may effect a business
+combination with a target company that has business operations in multiple jurisdictions. If we effect such a business combination, we
+could be subject to significant income, withholding and other tax obligations in a number of jurisdictions with respect to income, operations
+and subsidiaries related to those jurisdictions. Due to the complexity of tax obligations and filings in other jurisdictions, we may
+have a heightened risk related to audits or examinations by taxing authorities. This additional complexity and risk could have an adverse
+effect on our after-tax profitability and financial condition.
+
+ 
+
+We may have a limited ability to assess
+the management of a prospective target business and, as a result, may effect our initial business combination with a target business
+whose management may not have the skills, qualifications or abilities to manage a public company.
+
+ 
+
+When evaluating the desirability
+of effecting our initial business combination with a prospective target business, our ability to assess the target business s management
+may be limited due to a lack of time, resources or information. Our assessment of the capabilities of the target s management,
+therefore, may prove to be incorrect and such management may lack the skills, qualifications or abilities we suspected. Should the target s
+management not possess the skills, qualifications or abilities necessary to manage a public company, the operations and profitability
+of the post-combination business may be negatively impacted. Accordingly, any shareholders who choose to remain shareholders following
+the business combination could suffer a reduction in the value of their shares. Such shareholders are unlikely to have a remedy for such
+reduction in value.
+
+ 
+
+The officers and directors
+of an acquisition candidate may resign upon completion of our initial business combination. The departure of a business combination target s
+key personnel could negatively impact the operations and profitability of our post-combination business. The role of an acquisition candidates 
+key personnel upon the completion of our initial business combination cannot be ascertained at this time. Although we contemplate that
+certain members of an acquisition candidate s management team will remain associated with the acquisition candidate following our
+initial business combination, it is possible that members of the management of an acquisition candidate will not wish to remain in place.
+
+ 
+
+Since our sponsor, officers and directors
+will not be eligible to be reimbursed for their out-of-pocket expenses if our initial business combination is not completed, a conflict
+of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination.
+
+ 
+
+At the closing of our initial
+business combination, our sponsor, officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket
+expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due diligence
+on suitable business combinations. There is no cap or ceiling on the reimbursement of out-of-pocket expenses incurred in connection with
+activities on our behalf. These financial interests of our sponsor, officers and directors may influence their motivation in identifying
+and selecting a target business combination and completing an initial business combination.
+
+ 
+
+ 47
+
+ 
+
+ 
+
+ 
+
+We may reincorporate in another jurisdiction
+in connection with our initial business combination and such reincorporation may result in taxes imposed on shareholders.
+
+ 
+
+We may, in connection with
+our initial business combination and subject to requisite shareholder approval under the Companies Act, reincorporate in the jurisdiction
+in which the target company or business is located. The transaction may require a shareholder to recognize taxable income in the jurisdiction
+in which the shareholder is a tax resident or in which its members are resident if it is a tax transparent entity. We do not intend to
+make any cash distributions to shareholders to pay such taxes. Shareholders may be subject to withholding taxes or other taxes with respect
+to their ownership of us after the reincorporation.
+
+ 
+
+We may effect a business combination with a target company that has
+business operations in multiple jurisdictions. If we effect such a business combination, we could be subject to significant income, withholding
+and other tax obligations in a number of jurisdictions with respect to income, operations and subsidiaries related to those jurisdictions.
+Due to the complexity of tax obligations and filings in other jurisdictions, we may have a heightened risk related to audits or examinations
+by taxing authorities. This additional complexity and risk could have an adverse effect on our after-tax profitability and financial
+condition.
+
+ 
+
+We may have a limited ability to assess
+the management of a prospective target business and, as a result, may effect our initial business combination with a target business
+whose management may not have the skills, qualifications or abilities to manage a public company.
+
+ 
+
+When evaluating the desirability
+of effecting our initial business combination with a prospective target business, our ability to assess the target business s management
+may be limited due to a lack of time, resources or information. Our assessment of the capabilities of the target s management,
+therefore, may prove to be incorrect and such management may lack the skills, qualifications or abilities we suspected. Should the target s
+management not possess the skills, qualifications or abilities necessary to manage a public company, the operations and profitability
+of the post-combination business may be negatively impacted. Accordingly, any shareholders who choose to remain shareholders following
+the business combination could suffer a reduction in the value of their shares. Such shareholders are unlikely to have a remedy for such
+reduction in value.
+
+ 
+
+The officers and directors
+of an acquisition candidate may resign upon completion of our initial business combination. The departure of a business combination target s
+key personnel could negatively impact the operations and profitability of our post-combination business. The role of an acquisition candidates 
+key personnel upon the completion of our initial business combination cannot be ascertained at this time. Although we contemplate that
+certain members of an acquisition candidate s management team will remain associated with the acquisition candidate following our
+initial business combination, it is possible that members of the management of an acquisition candidate will not wish to remain in place.
+
+ 
+
+Since our sponsor, officers and directors
+will not be eligible to be reimbursed for their out-of-pocket expenses if our initial business combination is not completed, a conflict
+of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination.
+
+ 
+
+At the closing of our initial
+business combination, our sponsor, officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket
+expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due diligence
+on suitable business combinations. There is no cap or ceiling on the reimbursement of out-of-pocket expenses incurred in connection with
+activities on our behalf. These financial interests of our sponsor, officers and directors may influence their motivation in identifying
+and selecting a target business combination and completing an initial business combination.
+
+ 
+
+Risks Relating to our Management Team
+
+ 
+
+We are dependent upon our officers and
+directors and their departure could adversely affect our ability to operate.
+
+ 
+
+Our operations are dependent
+upon a relatively small group of individuals, our officers and directors. We believe that our success depends on the continued service
+of our officers and directors, at least until we have completed our initial business combination. In addition, our officers and directors
+are not required to commit any specified amount of time to our affairs and, accordingly, will have conflicts of interest in allocating
+management time among various business activities, including identifying potential business combinations and monitoring the related due
+diligence. We do not have an employment agreement with, or key-man insurance on the life of, any of our directors or officers. The unexpected
+loss of the services of one or more of our directors or officers could have a detrimental effect on us.
+
+ 
+
+Our key personnel may negotiate employment
+or consulting agreements with a target business in connection with a particular business combination. These agreements may provide for
+them to receive compensation following our initial business combination and as a result, may cause them to have conflicts of interest
+in determining whether a particular business combination is the most advantageous.
+
+ 
+
+Our key personnel may be
+able to remain with the company after the completion of our initial business combination only if they are able to negotiate employment
+or consulting agreements in connection with the business combination. Such negotiations would take place simultaneously with the negotiation
+of the business combination and could provide for such individuals to receive compensation in the form of cash payments and/or our securities
+for services they would render to us after the completion of the business combination. The personal and financial interests of such individuals
+may influence their motivation in identifying and selecting a target business, subject to his or her fiduciary duties under British Virgin
+Islands law. However, we believe the ability of such individuals to remain with us after the completion of our initial business combination
+will not be the determining factor in our decision as to whether or not we will proceed with any potential business combination. There
+is no certainty, however, that any of our key personnel will remain with us after the completion of our initial business combination.
+We cannot assure you that any of our key personnel will remain in senior management or advisory positions with us. The determination
+as to whether any of our key personnel will remain with us will be made at the time of our initial business combination.
+
+ 
+
+ 48
+
+ 
+
+ 
+
+ 
+
+Our officers and directors will allocate
+their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs.
+This conflict of interest could have a negative impact on our ability to complete our initial business combination.
+
+ 
+
+Our officers and directors
+are not required to, and will not, commit their full time to our affairs, which may result in a conflict of interest in allocating their
+time between our operations and our search for a business combination and their other businesses. We do not intend to have any full-time
+employees prior to the completion of our initial business combination. Each of our officers is engaged in several other business endeavors
+for which he or she may be entitled to substantial compensation and our officers are not obligated to contribute any specific number
+of hours per week to our affairs. Our independent directors also serve as officers and board members for other entities. If our officers 
+and directors other business affairs require them to devote substantial amounts of time to such affairs in excess of their current
+commitment levels, it could limit their ability to devote time to our affairs which may have a negative impact on our ability to complete
+our initial business combination. For a complete discussion of our officers and directors other business affairs, please
+see "Management — Directors and Officers".
+
+ 
+
+Certain of our officers and directors are
+now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be
+conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should
+be presented.
+
+ 
+
+Following the completion
+of this offering and until we consummate our initial business combination, we intend to engage in the business of identifying and combining
+with one or more businesses. Our sponsor and officers and directors are, or may in the future become, affiliated with entities such as
+operating companies, investment vehicles, or another special purpose acquisition company) that are engaged in making and managing investments
+that may be competitive to us.
+
+ 
+
+Our officers and directors
+also may become aware of business opportunities which may be appropriate for presentation to us and the other entities to which they
+owe certain fiduciary or contractual duties. Accordingly, they may have conflicts of interest in determining to which entity a particular
+business opportunity should be presented. These conflicts may not be resolved in our favor and a potential target business may be presented
+to other entities prior to its presentation to us, subject to his or her fiduciary duties under British Virgin Islands law.
+
+ 
+
+For a complete discussion
+of our officers and directors business affiliations and the potential conflicts of interest that you should be aware of,
+please see "Management — Directors and Officers", "Management — Conflicts of Interest" and "Certain
+Relationships and Related Party Transactions."
+
+ 
+
+Our officers, directors, security holders
+and their respective affiliates may have competitive pecuniary interests that conflict with our interests.
+
+ 
+
+We have not adopted a policy
+that expressly prohibits our directors, officers, security holders or affiliates from having a direct or indirect pecuniary or financial
+interest in any investment to be acquired or disposed of by us or in any transaction to which we are a party or have an interest. In
+fact, we may enter into a business combination with a target business that is affiliated with our sponsor, our directors or officers,
+although we do not intend to do so. Nor do we have a policy that expressly prohibits any such persons from engaging for their own account
+in business activities of the types conducted by us. Accordingly, such persons or entities may have a conflict between their interests
+and ours.
+
+ 
+
+We may not have sufficient funds to satisfy
+indemnification claims of our directors and executive officers.
+
+ 
+
+We have agreed to indemnify our officers and
+directors to the fullest extent permitted by law. However, our officers and directors have agreed to waive any right, title, interest
+or claim of any kind in or to any monies in the trust account and not to seek recourse against the trust account for any reason whatsoever.
+Accordingly, any indemnification provided will be able to be satisfied by us only if (i) we have sufficient funds outside of the
+trust account or (ii) we consummate an initial business combination. Our obligation to indemnify our officers and directors may
+discourage shareholders from bringing a lawsuit against our officers or directors for breach of their fiduciary duty. These provisions
+also may have the effect of reducing the likelihood of derivative litigation against our officers and directors, even though such an
+action, if successful, might otherwise benefit us and our shareholders. Furthermore, a shareholder s investment may be adversely
+affected to the extent we pay the costs of settlement and damage awards against our officers and directors pursuant to these indemnification
+provisions.
+
+ 
+
+ 49
+
+ 
+
+ 
+
+ 
+
+Risks Relating to our Securities and This Offering
+
+ 
+
+You will not have any rights or interests
+in funds from the trust account, except under certain limited circumstances. To liquidate your investment, therefore, you may be forced
+to sell your public shares, warrants or rights, potentially at a loss.
+
+ 
+
+Our public shareholders
+will be entitled to receive funds from the trust account only upon the earlier to occur of: (i) the completion of our initial business
+combination, (ii) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended
+and restated memorandum and articles of association to (A) modify the substance or timing of our obligation to redeem 100% of our
+public shares if we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21
+months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time)
+or (B) with respect to any other provision relating to shareholders rights or pre-business combination activity and (iii) the
+redemption of all of our public shares if we are unable to complete our initial business combination within 15 months from the closing
+of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination
+by the full amount of time), subject to applicable law and as further described herein. In no other circumstances will a public shareholder
+have any right or interest of any kind in the trust account. Accordingly, to liquidate your investment, you may be forced to sell your
+public shares, warrants or rights, potentially at a loss.
+
+ 
+
+NASDAQ may delist our securities from trading
+on its exchange, which could limit investors ability to make transactions in our securities and subject us to additional trading
+restrictions.
+
+ 
+
+We have applied to have
+our units listed on NASDAQ on or promptly after the date of this prospectus and our Class A ordinary shares, warrants and rights
+listed on or promptly after their date of separation. We cannot guarantee that our securities will be approved for listing on NASDAQ.
+Although after giving effect to this offering we expect to meet, on a pro forma basis, the minimum initial listing standards set forth
+in the NASDAQ listing standards, we cannot assure you that our securities will be, or will continue to be, listed on NASDAQ in the future
+or prior to our initial business combination. In order to continue listing our securities on NASDAQ prior to our initial business combination,
+we must maintain certain financial, distribution and stock price levels. Generally, we must maintain a minimum amount in shareholders 
+equity (generally $2,500,000) and a minimum number of holders of our securities (generally 300 public holders). Additionally, in connection
+with our initial business combination, we will be required to demonstrate compliance with NASDAQ s initial listing requirements,
+which are more rigorous than NASDAQ s continued listing requirements, in order to continue to maintain the listing of our securities
+on NASDAQ. For instance, our stock price would generally be required to be at least $4.00 per share, our shareholders equity would
+generally be required to be at least $5.0 million and we would be required to have a minimum of 300 round lot holders of our securities
+(with at least 50% of such round lot holders holding securities with a market value of at least $2,500). We cannot assure you that we
+will be able to meet those initial listing requirements at that time.
+
+ 
+
+If NASDAQ delists our securities
+from trading on its exchange and we are not able to list our securities on another national securities exchange, we expect our securities
+could be quoted on an over-the-counter market. If this were to occur, we could face significant material adverse consequences, including:
+
+ 
+
+ 
+ 
+ 
+ a limited availability of market quotations for our securities;
+
+ 
+
+ 
+
+ 50
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ reduced liquidity for our securities;
+
+ 
+ 
+
+ 
+ 
+ 
+ a determination that our Class A ordinary shares is
+ a "penny stock" which will require brokers trading in our Class A ordinary shares to adhere to more stringent rules and
+ possibly result in a reduced level of trading activity in the secondary trading market for our securities;
+
+ 
+ 
+
+ 
+ 
+ 
+ a limited amount of news and analyst coverage; and
+
+ 
+ 
+
+ 
+ 
+ 
+ a decreased ability to issue additional securities or obtain
+ additional financing in the future.
+
+ 
+ 
+
+The National Securities
+Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities,
+which are referred to as "covered securities." Because we expect that our units and eventually our Class A ordinary
+shares, warrants and rights will be listed on NASDAQ, our units, Class A ordinary shares, warrants and rights will be covered securities.
+Although the states are preempted from regulating the sale of our securities, the federal statute does allow the states to investigate
+companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the
+sale of covered securities in a particular case. While we are not aware of a state having used these powers to prohibit or restrict the
+sale of securities issued by blank check companies, other than the State of Idaho, certain state securities regulators view blank check
+companies unfavorably and might use these powers, or threaten to use these powers, to hinder the sale of securities of blank check companies
+in their states. Further, if we were no longer listed on NASDAQ, our securities would not be covered securities and we would be subject
+to regulation in each state in which we offer our securities, including in connection with our initial business combination.
+
+ 
+
+Our sponsor paid an aggregate of $25,000,
+or approximately $0.004 per founder share, and, accordingly, you will experience immediate and substantial dilution upon the purchase
+of our Class A ordinary shares.
+
+ 
+
+The difference between the
+public offering price per share (allocating all of the unit purchase price to the ordinary shares and none to the warrants and rights
+included in the units) and the pro forma net tangible book value per Class A ordinary share after this offering constitutes the
+dilution to you and the other investors in this offering. Our sponsor acquired the founder shares at a nominal price, significantly contributing
+to this dilution. Upon the closing of this offering, and assuming no value is ascribed to the warrants and rights included in the units,
+you and the other public shareholders will incur an immediate and substantial dilution of approximately 108.6% (or $9.88 per share, assuming
+no exercise of the underwriters over-allotment option), the difference between the pro forma net tangible book value per share
+of $9.09 and the effective initial offering price of $(0.79) per share. This dilution would increase to the extent that the anti-dilution
+provisions of the Class B ordinary shares result in the issuance of Class A ordinary shares on a greater than one-to-one basis
+upon conversion of the Class B ordinary shares at the time of our initial business combination and would become exacerbated to the
+extent that public shareholders seek redemptions from the trust. In addition, because of the anti-dilution protection in the founder
+shares, any equity or equity-linked securities issued or deemed issued in connection with our initial business combination would be disproportionately
+dilutive to our Class A ordinary shares.
+
+ 
+
+The determination of the offering price
+of our units and the size of this offering is more arbitrary than the pricing of securities and size of an offering of an operating company
+in a particular industry. You may have less assurance, therefore, that the offering price of our units properly reflects the value of
+such units than you would have in a typical offering of an operating company.
+
+ 
+
+Prior to this offering there
+has been no public market for any of our securities. The public offering price of the units and the terms of the warrants and rights
+were negotiated between us and the underwriters. In determining the size of this offering, management held customary organizational meetings
+with representatives of the underwriters, both prior to our inception and thereafter, with respect to the state of capital markets, generally,
+and the amount the underwriters believed they reasonably could raise on our behalf. Factors considered in determining the size of this
+offering, prices and terms of the units, including the Class A ordinary shares, warrants and rights underlying the units, include:
+
+ 
+
+ 
+ 
+ 
+ the history and prospects of companies whose principal
+ business is the acquisition of other companies;
+
+ 
+ 
+
+ 
+ 
+ 
+ prior offerings of those companies;
+
+ 
+ 
+
+ 
+ 
+ 
+ our prospects for acquiring an operating business at attractive
+ values;
+
+ 
+ 
+
+ 
+ 
+ 
+ a review of debt to equity ratios in leveraged transactions;
+
+ 
+ 
+
+ 
+ 
+ 
+ our capital structure;
+
+ 
+ 
+
+ 
+ 
+ 
+ an assessment of our management and their experience in
+ identifying operating companies;
+
+ 
+ 
+
+ 51
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ general conditions of the securities markets at the time
+ of this offering; and
+
+ 
+ 
+
+ 
+ 
+ 
+ other factors as were deemed relevant.
+
+ 
+ 
+
+Although these factors were
+considered, the determination of our offering price is more arbitrary than the pricing of securities of an operating company in a particular
+industry since we have no historical operations or financial results.
+
+ 
+
+There is currently no market for our securities
+and a market for our securities may not develop, which would adversely affect the liquidity and price of our securities.
+
+ 
+
+There is currently no market
+for our securities. Shareholders therefore have no access to information about prior market history on which to base their investment
+decision. Following this offering, the price of our securities may vary significantly due to one or more potential business combinations
+and general market or economic conditions. Furthermore, an active trading market for our securities may never develop or, if developed,
+it may not be sustained. You may be unable to sell your securities unless a market can be established and sustained.
+
+ 
+
+Provisions in our amended and restated
+memorandum and articles of association may inhibit a takeover of us, which could limit the price investors might be willing to pay in
+the future for our Class A ordinary shares and could entrench management.
+
+ 
+
+Our amended and restated
+memorandum and articles of association will contain provisions that may discourage unsolicited takeover proposals that shareholders may
+consider to be in their best interests. These provisions include two-year director terms and the ability of the Board of Directors to
+designate the terms of and issue new series of preference shares, which may make more difficult the removal of management and may discourage
+transactions that otherwise could involve payment of a premium over prevailing market prices for our securities.
+
+ 
+
+We may amend the terms of the warrants
+in a manner that may be adverse to holders of public warrants with the approval by the holders of at least a majority of the then outstanding
+public warrants.
+
+ 
+
+Our warrants will be issued
+in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. The
+warrant agreement provides that the terms of the warrants may be amended without the consent of any holder to cure any ambiguity or correct
+any defective provision, but requires the approval by the holders of at least a majority of the then outstanding public warrants to make
+any change that adversely affects the interests of the registered holders of public warrants. Accordingly, we may amend the terms of
+the public warrants in a manner adverse to a holder if holders of at least a majority of the then outstanding public warrants approve
+of such amendment. Our ability to amend the terms of the public warrants with the consent of at least a majority of the then outstanding
+public warrants is unlimited, examples of such amendments could be amendments to, among other things, increase the exercise price of
+the warrants, shorten the exercise period or decrease the number of ordinary shares purchasable upon exercise of a warrant.
+
+ 
+
+We may redeem your unexpired warrants prior
+to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.
+
+ 
+
+We have the ability to redeem
+outstanding warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided
+that the last reported sales price of our Class A ordinary shares equal or exceed $16.50 per share (as adjusted for share splits,
+share capitalizations, rights issuances, subdivisions, reorganizations, recapitalizations and the like) for any 20 trading days within
+a 30 trading-day period ending on the third trading day prior to the date we send the notice of redemption to the warrant holders. If
+and when the warrants become redeemable by us, we may not exercise our redemption right if the issuance of shares upon exercise of the
+warrants is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect such registration
+or qualification. We will use our best efforts to register or qualify such ordinary shares under the blue sky laws of the state of residence
+in those states in which the warrants were offered by us in this offering. Redemption of the outstanding warrants could force you (i) to
+exercise your warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (ii) to sell
+your warrants at the then-current market price when you might otherwise wish to hold your warrants or (iii) to accept the nominal
+redemption price which, at the time the outstanding warrants are called for redemption, is likely to be substantially less than the market
+value of your warrants. None of the private placement warrants will be redeemable by us so long as they are held by our sponsor or its
+permitted transferees.
+
+ 
+
+ 52
+
+ 
+
+ 
+
+ 
+
+We are not registering the Class A
+ordinary shares issuable upon exercise of the warrants under the Securities Act or any state securities laws at this time, and such registration
+may not be in place when an investor desires to exercise warrants, thus precluding such investor from being able to exercise its warrants
+except on a cashless basis and potentially causing such warrants to expire worthless.
+
+ 
+
+We are not registering the
+Class A ordinary shares issuable upon exercise of the warrants under the Securities Act or any state securities laws at this time.
+However, under the terms of the warrant agreement, we have agreed that as soon as practicable, after the closing of our initial business
+combination, we will use our best efforts to file, and within 60 business days following our initial business combination to have declared
+effective, a registration statement covering such shares and maintain a current prospectus relating to the Class A ordinary shares
+issuable upon exercise of the warrants, until the expiration of the warrants in accordance with the provisions of the warrant agreement.
+We cannot assure you that we will be able to do so if, for example, any facts or events arise which represent a fundamental change in
+the information set forth in the registration statement or prospectus, the financial statements contained or incorporated by reference
+therein are not current or correct or the SEC issues a stop order. If the shares issuable upon exercise of the warrants are not registered
+under the Securities Act, we will be required to permit holders to exercise their warrants on a cashless basis. However, no warrant will
+be exercisable for cash or on a cashless basis, and we will not be obligated to issue any shares to holders seeking to exercise their
+warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the
+exercising holder, or an exemption is available. Notwithstanding the foregoing, if a registration statement covering the Class A
+ordinary shares issuable upon exercise of the warrants is not effective within a specified period following the consummation of our initial
+business combination, warrant holders may, until such time as there is an effective registration statement and during any period when
+we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to the exemption
+provided by Section 3(a)(9) of the Securities Act, provided that such exemption is available. If that exemption, or another
+exemption, is not available, holders will not be able to exercise their warrants on a cashless basis. We will use our best efforts
+to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. In no event will we be
+required to net cash settle any warrant, or issue securities or other compensation in exchange for the warrants in the event that we
+are unable to register or qualify the shares underlying the warrants under applicable state securities laws and no exemption is available.
+If the issuance of the shares upon exercise of the warrants is not so registered or qualified or exempt from registration or qualification,
+the holder of such warrant shall not be entitled to exercise such warrant and such warrant may have no value and expire worthless. In
+such event, holders who acquired their warrants as part of a purchase of units will have paid the full unit purchase price solely for
+the Class A ordinary shares included in the units. If and when the warrants become redeemable by us, we may not exercise our redemption
+right if the issuance of shares upon exercise of the warrants is not exempt from registration or qualification under applicable state
+blue sky laws or we are unable to effect such registration or qualification. We will use our best efforts to register or qualify such
+ordinary shares under the blue sky laws of the state of residence in those states in which the warrants were offered by us in this offering.
+
+ 
+
+Because each unit contains one-half of
+one redeemable warrant and only a whole warrant may be exercised, the units may be worth less than units of other blank check companies.
+
+ 
+
+Each unit contains one-half
+of one redeemable warrant. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly,
+unless you purchase at least two units, you will not be able to receive or trade a whole warrant. This is different from other offerings
+similar to ours whose units include one Class A ordinary share and one warrant to purchase one whole share. We have established
+the components of the units in this way in order to reduce the dilutive effect of the warrants upon completion of an initial business
+combination since the warrants will be exercisable in the aggregate for one-half of the number of shares compared to units that contain
+a warrant to purchase one whole share, thus making us, we believe, a more attractive merger partner for target businesses. Nevertheless,
+this unit structure may cause our units to be worth less than if they included a warrant to purchase one whole share.
+
+ 
+
+Our management s ability to require
+holders of our warrants to exercise such warrants on a cashless basis will cause holders to receive fewer Class A ordinary shares
+upon their exercise of the warrants than they would have received had they been able to exercise their warrants for cash.
+
+ 
+
+If we call our public warrants
+for redemption after the redemption criteria described elsewhere in this prospectus have been satisfied, our management will have the
+option to require any holder that wishes to exercise his warrant (including the private placement warrants any warrants held by our sponsor,
+officers or directors, other purchasers of our founders units, or their permitted transferees) to do so on a "cashless basis."
+If our management chooses to require holders to exercise their warrants on a cashless basis, the number of Class A ordinary shares
+received by a holder upon exercise will be fewer than it would have been had such holder exercised his warrant for cash. This will have
+the effect of reducing the potential "upside" of the holder s investment in our company.
+
+ 
+
+The grant of registration rights to our
+sponsor and holders of our private placement warrants may make it more difficult to complete our initial business combination, and the
+future exercise of such rights may adversely affect the market price of our Class A ordinary shares.
+
+ 
+
+Pursuant to an agreement
+to be entered into concurrently with the issuance and sale of the securities in this offering, our initial shareholder and its permitted
+transferees can demand that we register the founder shares, the Class A ordinary shares included in the private placement warrants, founder
+shares, and holders of warrants that may be issued upon conversion of working capital loans may demand that we register such Class A
+ordinary shares, warrants, rights or the Class A ordinary shares issuable upon exercise of such rights. We will bear the cost
+of registering these securities. The registration and availability of such a significant number of securities for trading in the public
+market may have an adverse effect on the market price of our Class A ordinary shares. In addition, the existence of the registration
+rights may make our initial business combination more costly or difficult to conclude. This is because the shareholders of the target
+business may increase the equity stake they seek in the combined entity or ask for more cash consideration to offset the negative impact
+on the market price of our Class A ordinary shares that is expected when the ordinary shares owned by our sponsor, holders of our
+private placement warrants or holders of our working capital loans or their respective permitted transferees are registered.
+
+ 
+
+ 53
+
+ 
+
+ 
+
+ 
+
+We may issue our shares to investors in
+connection with our initial business combination at a price which is less than the prevailing market price of our shares at that time.
+
+ 
+
+In connection with our initial
+business combination, we may issue shares to investors in private placement transactions (so-called PIPE transactions) at a price of
+$10.00 per share, or at a price which approximates the per-share amounts in our trust account at such time, which is generally approximately
+$10.00. The purpose of such issuances will be to enable us to provide sufficient liquidity to the post-business combination entity. The
+price of the shares we issue may therefore be less, and potentially significantly less, than the market price for our shares at such
+time.
+
+ 
+
+Changes in the market for directors and
+officers liability insurance could make it more difficult and more expensive for us to negotiate and complete an initial business combination.
+
+ 
+
+In recent months, the market
+for directors and officers liability insurance for special purpose acquisition companies has changed. Fewer insurance companies are offering
+quotes for directors and officers liability coverage, the premiums charged for such policies have generally increased and the terms of
+such policies have generally become less favorable. There can be no assurance that these trends will not continue.
+
+ 
+
+The increased cost and decreased
+availability of directors and officers liability insurance could make it more difficult and more expensive for us to negotiate an initial
+business combination. In order to obtain directors and officers liability insurance or modify its coverage as a result of becoming a
+public company, the post-business combination entity might need to incur greater expense, accept less favorable terms or both. However,
+any failure to obtain adequate directors and officers liability insurance could have an adverse impact on the post-business combination s
+ability to attract and retain qualified officers and directors.
+
+ 
+
+In addition, even after
+we were to complete an initial business combination, our directors and officers could still be subject to potential liability from claims
+arising from conduct alleged to have occurred prior to the initial business combination. As a result, in order to protect our directors
+and officers, the post-business combination entity may need to purchase additional insurance with respect to any such claims ("run-off
+insurance"). The need for run-off insurance would be an added expense for the post-business combination entity, and could interfere
+with or frustrate our ability to consummate an initial business combination on terms favorable to our investors.
+
+ 
+
+We may engage one or more of our underwriters
+or one of their respective affiliates to provide additional services to us after this offering, which may include acting as M&A advisor
+in connection with an initial business combination or as placement agent in connection with a related financing transaction. Our underwriters
+are entitled to receive deferred underwriting commissions that will be released from the trust account only upon a completion of an initial
+business combination. These financial incentives may cause them to have potential conflicts of interest in rendering any such additional
+services to us after this offering, including, for example, in connection with the sourcing and consummation of an initial business combination.
+
+ 
+
+We may engage one or more
+of our underwriters or one of their respective affiliates to provide additional services to us after this offering, including, for example,
+identifying potential targets, providing M&A advisory services, acting as a placement agent in a private offering or arranging debt
+financing transactions. We may pay such underwriter or its affiliate fair and reasonable fees or other compensation that would be determined
+at that time in an arm s length negotiation; provided that no agreement will be entered into with any of the underwriters or their
+respective affiliates and no fees or other compensation for such services will be paid to any of the underwriters or their respective
+affiliates prior to the date that is 60 days from the date of this prospectus, unless such payment would not be deemed underwriters 
+compensation in connection with this offering. The underwriters are also entitled to receive deferred underwriting commissions that are
+conditioned on the completion of an initial business combination. The underwriters or their respective affiliates financial
+interests tied to the consummation of a business combination transaction may give rise to potential conflicts of interest in providing
+any such additional services to us, including potential conflicts of interest in connection with the sourcing and consummation of an
+initial business combination.
+
+ 
+
+Our
+warrant agreement and rights agreement will designate the courts of the State of New York or the United States District Court for the
+Southern District of New York as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by holders
+of our warrants or rights, which could limit the ability of warrant holders and rights holders to obtain a favorable judicial forum for
+disputes with our company.
+
+ 
+
+Our warrant agreement and
+rights agreement will provide that, subject to applicable law, (i) any action, proceeding or claim against us arising out of or relating
+in any way to the warrant agreement and rights agreement, including under the Securities Act, will be brought and enforced in the courts
+of the State of New York or the United States District Court for the Southern District of New York, and (ii) that we irrevocably submit
+to such jurisdiction, which jurisdiction shall be the exclusive forum for any such action, proceeding or claim. We will waive any objection
+to such exclusive jurisdiction and that such courts represent an inconvenient forum.
+
+ 
+
+ 54
+
+ 
+
+ 
+
+ 
+
+Notwithstanding the foregoing,
+these provisions of the rights agreement will not apply to suits brought to enforce any liability or duty created by the Exchange Act
+or any other claim for which the federal district courts of the United States of America are the sole and exclusive forum. Any person
+or entity purchasing or otherwise acquiring any interest in any of our rights shall be deemed to have notice of and to have consented
+to the forum provisions in our rights agreement. If any action, the subject matter of which is within the scope the forum provisions
+of the rights agreement, is filed in a court other than a court of the State of New York or the United States District Court for the
+Southern District of New York (for purposes of this subsection, a "foreign action") in the name of any holder of our rights,
+such holder shall be deemed to have consented to: (x) the personal jurisdiction of the state and federal courts located in the State
+of New York in connection with any action brought in any such court to enforce the forum provisions (for purposes of this subsection,
+an "enforcement action"), and (y) having service of process made upon such rights holder in any such enforcement action by
+service upon such rights holder s counsel in the foreign action as agent for such warrant or rights holder.
+
+ 
+
+This choice-of-forum provision
+may limit a rights holder s ability to bring a claim in a judicial forum that it finds favorable for disputes with our company,
+including by increasing the cost of such lawsuits to a warrant or rights holder, which may discourage such lawsuits. Alternatively, if
+a court were to find this provision of our warrant agreement and rights agreement inapplicable or unenforceable with respect to one or
+more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other
+jurisdictions, which could materially and adversely affect our business, financial condition and results of operations and result in
+a diversion of the time and resources of our management and Board of Directors.
+
+ 
+
+Holders of warrants and rights will not
+have redemption rights.
+
+ 
+
+If we are unable to complete an initial business
+combination within the required time period and we redeem the funds held in the trust account, the warrants and rights will expire and
+holders will not receive any of the amounts held in the trust account in exchange for such warrants or rights.
+
+ 
+
+We have no obligation to net cash settle the
+warrants or rights. In no event will we have any obligation to net cash settle the warrants or rights. Accordingly, the warrants and
+rights may expire worthless.
+
+ 
+
+We may amend the terms of the rights in
+a way that may be adverse to holders with the approval by the holders of a majority of the then outstanding rights.
+
+ 
+
+Our rights will be issued
+in registered form under a rights agreement between Continental Stock Transfer & Trust Company, as rights agent, and us. The
+rights agreement provides that the terms of the rights may be amended without the consent of any holder to cure any ambiguity or correct
+any defective provision. The rights agreement requires the approval by the holders of a majority of the then outstanding rights in order
+to make any change that adversely affects the interests of the registered holders.
+
+ 
+
+U.S. federal income tax reform could adversely
+affect us and holders of our units.
+
+ 
+
+On December 22, 2017,
+President Trump signed into law H.R. 1, originally known as the "Tax Cuts and Jobs Act," which significantly reformed the
+Internal Revenue Code of 1986, as amended. The new legislation, among other things, changes the U.S. federal tax rates, imposes significant
+additional limitations on the deductibility of interest, allows the expensing of capital expenditures, and puts into effect the migration
+from a "worldwide" system of taxation to a territorial system. We continue to examine the impact this tax reform legislation
+may have on us. The impact of this tax reform, or of any future administrative guidance interpreting provisions thereof, on holders of
+our units is uncertain and could be adverse. This prospectus does not discuss any such tax legislation or the manner in which it might
+affect holders of our units. We urge prospective investors to consult with their legal and tax advisors with respect to any such legislation
+and the potential tax consequences of investing in our units.
+
+ 
+
+Our rights and founder shares may have
+an adverse effect on the market price of our Class A ordinary shares and make it more difficult to effectuate our initial business
+combination.
+
+ 
+
+Prior to this offering,
+our sponsor purchased an aggregate of 5,318,750 founder shares in a private placement. The founder shares are convertible into Class A
+ordinary shares on a one-for-one basis, subject to adjustment as set forth herein and in our amended and restated memorandum and articles
+of association. In addition, if our sponsor makes any working capital loans, up to $1,150,000 of such loans may be converted into warrants,
+at the price of $1.00 per warrant at the option of the lender. Such warrants would be identical to the private placement warrants. To
+the extent we issue Class A ordinary shares to effectuate a business transaction, the potential for the issuance of a substantial
+number of additional Class A ordinary shares upon exercise of these warrants, conversion of these rights or conversion of these
+working capital loans into our securities could make us a less attractive acquisition vehicle to a target business. Any such issuance
+will increase the number of issued and outstanding Class A ordinary shares and reduce the value of the Class A ordinary shares
+issued to complete the business transaction. Therefore, our warrants, rights and founder shares may make it more difficult to effectuate
+a business combination or increase the cost of acquiring the target business.
+
+ 
+
+The private placement warrants
+are identical to the warrants sold as part of the units in this offering except that, so long as they are held by our sponsor or its
+permitted transferees, (i) they will not be redeemable by us, (ii) they (including the Class A ordinary shares issuable
+upon exercise of these warrants) may not, subject to certain limited exceptions, be transferred, assigned or sold by our sponsor until
+30 days after the completion of our initial business combination and (iii) they may be exercised by the holders on a cashless basis.
+
+ 
+
+ 55
+
+ 
+
+ 
+
+ 
+
+The value of the founder shares following completion of our
+initial business combination is likely to be substantially higher than the nominal price paid for them, even if the trading price of
+our ordinary shares at such time is substantially less than $10.175 per share. 
+
+Upon the closing of this
+offering, assuming no exercise of the underwriters over-allotment option, our sponsor will have invested in us an aggregate of
+$8,475,000, comprised of the $25,000 purchase price for the founder shares and the $8,450,000 purchase price for the private placement
+warrants. Assuming a trading price of $10.00 per share upon consummation of our initial business combination, the 4,625,000 founder shares
+would have an aggregate implied value of $46,250,000. Even if the trading price of our ordinary shares falls substantially, the value
+of the founder shares would be equal to the sponsor s initial investment in us. As a result, our sponsor is likely to be able to
+recoup its investment in us and make a profit on that investment, even if our public shares have lost significant value. Accordingly,
+our management team, which owns interests in our sponsor, may have an economic incentive that differs from that of the public shareholders
+to pursue and consummate an initial business combination rather than to liquidate and to return all of the cash in the trust to the public
+shareholders.
+
+ 
+
+If our management following our initial business combination
+is unfamiliar with United States securities laws, they may have to expend time and resources becoming familiar with such laws, which
+could lead to various regulatory issues.
+
+ 
+
+Following our initial business
+combination any or all of our management could resign from their positions as officers of the Company, and the management of the target
+business at the time of the business combination will remain in place. Management of the target business may not be familiar with United
+States securities laws. If new management is unfamiliar with United States securities laws, they may have to expend time and resources
+becoming familiar with such laws. This could be expensive and time-consuming and could lead to various regulatory issues which may adversely
+affect our operations.
+
+ 
+
+Certain agreements related to this offering
+may be amended without shareholder approval.
+
+ 
+
+Certain agreements, including
+the underwriting agreement relating to this offering, the investment management trust agreement between us and Continental Stock Transfer &
+Trust Company, the letter agreement among us and our sponsor, officers, directors and director nominees, and the registration rights
+agreement among us and our sponsor, may be amended without shareholder approval. These agreements contain various provisions that our
+public shareholders might deem to be material. For example, the underwriting agreement related to this offering contains a covenant that
+the target company that we acquire must have a fair market value equal to at least 80% of the balance in the trust account at the time
+of signing the definitive agreement for the transaction with such target business (excluding the deferred underwriting commissions and
+taxes payable on the income earned on the trust account) so long as we obtain and maintain a listing for our securities on NASDAQ. While
+we do not expect our board to approve any amendment to any of these agreements prior to our initial business combination, it may be possible
+that our board, in exercising its business judgment and subject to its fiduciary duties, chooses to approve one or more amendments to
+any such agreement in connection with the consummation of our initial business combination. Any such amendment may have an adverse effect
+on the value of an investment in our securities.
+
+ 
+
+ 56
+
+ 
+
+ 
+
+ 
+
+Risks Associated with Acquiring and Operating
+a Business Outside of the U.S.
+
+ 
+
+If we effect our initial business combination
+with a company located outside of the U.S., we would be subject to a variety of additional risks that may negatively impact our operations.
+
+ 
+
+If we effect our initial
+business combination with a company located outside of the U.S., we would be subject to any special considerations or risks associated
+with companies operating in the target business home jurisdiction, including any of the following:
+
+ 
+
+ 
+ 
+ 
+ rules and
+ regulations or currency redemption or corporate withholding taxes on individuals;
+
+ 
+ 
+
+ 
+ 
+ 
+ laws governing the manner in which future business combinations
+ may be effected;
+
+ 
+ 
+
+ 
+ 
+ 
+ tariffs and trade barriers;
+
+ 
+ 
+
+ 
+ 
+ 
+ regulations related to customs and import/export matters;
+
+ 
+ 
+
+ 
+ 
+ 
+ longer payment cycles;
+
+ 
+ 
+
+ 
+ 
+ 
+ tax issues, such as tax law changes and variations in tax
+ laws as compared to the U.S.;
+
+ 
+ 
+
+ 
+ 
+ 
+ currency fluctuations and exchange controls;
+
+ 
+ 
+
+ 
+ 
+ 
+ rates of inflation;
+
+ 
+ 
+
+ 
+ 
+ 
+ challenges in collecting accounts receivable;
+
+ 
+ 
+
+ 
+ 
+ 
+ cultural and language differences;
+
+ 
+ 
+
+ 
+ 
+ 
+ employment regulations;
+
+ 
+ 
+
+ 
+ 
+ 
+ crime, strikes, riots, civil disturbances, terrorist attacks
+ and wars; and
+
+ 
+ 
+
+ 
+ 
+ 
+ deterioration of political relations with the U.S. which
+ could result in any number of difficulties, both normal course such as above or extraordinary such as sanctions being imposed. We
+ may not be able to adequately address these additional risks. If we were unable to do so, our operations might suffer.
+
+ 
+ 
+
+ 57
+
+ 
+
+ 
+
+ 
+
+U.S. laws and regulations,
+including the Holding Foreign Companies Accountable Act, may restrict or eliminate our ability to complete a business combination with
+certain companies.
+
+ 
+
+Future developments in U.S.
+laws may restrict our ability or willingness to complete certain business combinations with companies. For instance, the recently enacted
+Holding Foreign Companies Accountable Act (the "HFCAA") would restrict our ability to consummate a business combination with
+a target business unless that business met certain standards of the PCAOB and would require delisting of a company from U.S. national
+securities exchanges if the PCAOB is unable to inspect its public accounting firm for three consecutive years. Additionally, there is
+pending legislation that would reduce the number of consecutive non-inspection years required for triggering the prohibitions under the
+HFCA Act from three years to two years.The HFCAA also requires public companies to disclose, among other things, whether they are owned
+or controlled by a foreign government, specifically, those based in China. We may not be able to consummate a business combination with
+a favored target business due to these laws.
+
+ 
+
+The documentation we may
+be required to submit to the SEC proving certain beneficial ownership requirements and establishing that we are not owned or controlled
+by a foreign government in the event that we use a foreign public accounting firm not subject to inspection by the PCAOB or where the
+PCAOB is unable to completely inspect or investigate our accounting practices or financial statements because of a position taken by
+an authority in the foreign jurisdiction could be onerous and time-consuming to prepare. HFCAA mandates the SEC to identify issuers of
+SEC-registered securities whose audited financial reports are prepared by an accounting firm that the PCAOB is unable to inspect due
+to restrictions imposed by an authority in the foreign jurisdiction where the audits are performed. If such identified issuer s
+auditor cannot be inspected by the PCAOB for three consecutive years, the trading of such issuer s securities on any U.S. national
+securities exchanges, as well as any over-the-counter trading in the U.S., will be prohibited.
+
+ 
+
+On March 24, 2021, the SEC
+adopted interim final rules relating to the implementation of certain disclosure and documentation requirements of the HFCAA. An identified
+issuer will be required to comply with these rules if the SEC identifies it as having a "non-inspection" year under a process
+to be subsequently established by the SEC. The SEC is assessing how to implement other requirements of the HFCAA, including the listing
+and trading prohibition requirements described above. Future developments in respect of increase U.S. regulatory access to audit information
+are uncertain, as the legislative developments are subject to the legislative process and the regulatory developments are subject to
+the rule-making process and other administrative procedures.
+
+ 
+
+In the event that we complete
+a business combination with a company with substantial operations in a foreign jurisdiction and any of the legislative actions or regulatory
+changes discussed above were to proceed in ways that are detrimental to issuers based in that jurisdiction, it could cause us to fail
+to be in compliance with U.S. securities laws and regulations, we could cease to be listed on a U.S. securities exchange, and U.S. trading
+of our shares could be prohibited. Any of these actions, or uncertainties in the market about the possibility of such actions, could
+adversely affect our prospects to successfully complete a business combination, our access to the U.S. capital markets and the price
+of our shares.
+
+ 
+
+Other developments in U.S.
+laws and regulatory environment, including but not limited to executive orders such as Executive Order (E.O.) 13959, "Addressing
+the Threat from Securities Investments That Finance Communist Chinese Military Companies," may further restrict our ability to
+complete a business combination with certain businesses.
+
+ 
+
+Because of the costs and difficulties inherent
+in managing cross-border business operations after we acquire it, our results of operations may be negatively impacted following a business
+combination.
+
+ 
+
+Managing a business, operations,
+personnel or assets in another country is challenging and costly. Management of the target business that we may hire (whether based abroad
+or in the U.S.) may be inexperienced in cross-border business practices and unaware of significant differences in accounting rules, legal
+regimes and labor practices. Even with a seasoned and experienced management team, the costs and difficulties inherent in managing cross-border
+business operations, personnel and assets can be significant (and much higher than in a purely domestic business) and may negatively
+impact our financial and operational performance.
+
+ 
+
+If social unrest, acts of terrorism, regime
+changes, changes in laws and regulations, political upheaval, or policy changes or enactments occur in a country in which we may operate
+after we effect our initial business combination, it may result in a negative effect on our business.
+
+ 
+
+Terrorist attacks, civil
+unrest and other acts of violence or war may negatively affect the markets in which we may operate our business following our business
+combination and also adversely affect the worldwide financial markets. In addition, the countries we will focus on have from time to
+time experienced civil unrest and hostilities among or between neighboring countries.
+
+ 
+
+Any such hostilities and
+tensions may result in investor concern about stability in the region, which may adversely affect the value of our equity shares and
+the trading price of our securities following our business combination. Events of this nature in the future, as well as social and civil
+unrest, could influence the economy in which our business target operates, and could have an adverse effect on our business, including
+the value of equity shares and the trading price of our securities following our business combination.
+
+ 
+
+Many countries, and especially those in
+emerging markets, have difficult and unpredictable legal systems and underdeveloped laws and regulations that are unclear and subject
+to corruption and inexperience, which may adversely impact our results of operations and financial condition.
+
+ 
+
+Our ability to seek and
+enforce legal protections, including with respect to intellectual property and other property rights, or to defend ourselves with regard
+to legal actions taken against us in a given country, may be difficult or impossible, which could adversely impact our operations, assets
+or financial condition.
+
+ 
+
+Rules and regulations
+in many countries, including some of the emerging markets within the regions we will initially focus, are often ambiguous or open to
+differing interpretation by responsible individuals and agencies at the municipal, state, regional and federal levels. The attitudes
+and actions of such individuals and agencies are often difficult to predict and inconsistent.
+
+ 
+
+Delay with respect to the
+enforcement of particular rules and regulations, including those relating to customs, tax, environmental and labor, could cause
+serious disruption to operations abroad and negatively impact our results.
+
+ 
+
+After our initial business combination,
+substantially all of our assets may be located in a foreign country and substantially all of our revenue may be derived from our operations
+in such country. Accordingly, our results of operations and prospects will be subject, to a significant extent, to the economic, political
+and legal policies, developments and conditions in the country in which we operate.
+
+ 
+
+The economic, political
+and social conditions, as well as government policies, of the country in which our operations are located could affect our business.
+The economies in developing markets we will initially focus on differ from the economies of most developed countries in many respects.
+Such economic growth has been uneven, both geographically and among various sectors of the economy and such growth may not be sustained
+in the future. If in the future such country s economy experiences a downturn or grows at a slower rate than expected, there may
+be less demand for spending in certain industries. A decrease in demand for spending in certain industries could materially and adversely
+affect our ability to find an attractive target business with which to consummate our initial business combination and if we effect our
+initial business combination, the ability of that target business to become profitable.
+
+ 
+
+ 58
+
+ 
+
+ 
+
+ 
+
+Exchange rate fluctuations and currency
+policies may cause a target business ability to succeed in the international markets to be diminished.
+
+ 
+
+In the event we acquire
+a non-U.S. target, all revenues and income would likely be received in a foreign currency and the dollar equivalent of our net assets
+and distributions, if any, could be adversely affected by reductions in the value of the local currency. The value of the currencies
+in our target regions fluctuate and are affected by, among other things, changes in political and economic conditions. Any change in
+the relative value of such currency against our reporting currency may affect the attractiveness of any target business or, following
+consummation of our initial business combination, our financial condition and results of operations. Additionally, if a currency appreciates
+in value against the dollar prior to the consummation of our initial business combination, the cost of a target business as measured
+in dollars will increase, which may make it less likely that we are able to consummate such transaction.
+
+ 
+
+Because our business objective
+includes the possibility of acquiring one or more operating businesses with primary operations in emerging markets we will focus on,
+changes in the exchange rate between the U.S. dollar and the currency of any relevant jurisdiction may affect our ability to achieve
+such objective. For instance, the exchange rates between the Turkish lira or the Indian rupee and the U.S. dollar has changed substantially
+in the last two decades and may fluctuate substantially in the future. If the U.S. dollar declines in value against the relevant currency,
+any business combination will be more expensive and therefore more difficult to complete. Furthermore, we may incur costs in connection
+with conversions between U.S. dollars and the relevant currency, which may make it more difficult to consummate a business combination.
+
+ 
+
+Because foreign law could govern almost
+all of our material agreements, we may not be able to enforce our rights within such jurisdiction or elsewhere, which could result in
+a significant loss of business, business opportunities or capital.
+
+ 
+
+Foreign law could govern
+almost all of our material agreements. The target business may not be able to enforce any of its material agreements or remedies may
+be unavailable outside of such foreign jurisdiction s legal system. The system of laws and the enforcement of existing laws and
+contracts in such jurisdiction may not be as certain in implementation and interpretation as in the U.S. Judiciaries in such jurisdiction
+may also be relatively inexperienced in enforcing corporate and commercial law, leading to a higher than usual degree of uncertainty
+as to the outcome of any litigation. As a result, the inability to enforce or obtain a remedy under any of our future agreements could
+result in a significant loss of business and business opportunities.
+
+ 
+
+Corporate governance standards in foreign
+countries may not be as strict or developed as in the U.S. and such weakness may hide issues and operational practices that are detrimental
+to a target business.
+
+ 
+
+General corporate governance
+standards in some countries are weak in that they do not prevent business practices that cause unfavorable related party transactions,
+over-leveraging, improper accounting, family company interconnectivity and poor management. Local laws often do not go far to prevent
+improper business practices. Therefore, shareholders may not be treated impartially and equally as a result of poor management practices,
+asset shifting, conglomerate structures that result in preferential treatment to some parts of the overall company, and cronyism. The
+lack of transparency and ambiguity in the regulatory process also may result in inadequate credit evaluation and weakness that may precipitate
+or encourage financial crisis. In our evaluation of a business combination we will have to evaluate the corporate governance of a target
+and the business environment, and in accordance with U.S. laws for reporting companies take steps to implement practices that will cause
+compliance with all applicable rules and accounting practices. Notwithstanding these intended efforts, there may be endemic practices
+and local laws that could add risk to an investment we ultimately make and that result in an adverse effect on our operations and financial
+results.
+
+ 
+
+Companies in foreign countries
+may be subject to accounting, auditing, regulatory and financial standards and requirements that differ, in some cases significantly,
+from those applicable to public companies in the United States, which may make it more difficult or complex to consummate a business
+combination. In particular, the assets and profits appearing on the financial statements of a foreign company may not reflect its financial
+position or results of operations in the way they would be reflected had such financial statements been prepared in accordance with U.S.
+GAAP and there may be substantially less publicly available information about companies in certain jurisdictions than there is about
+comparable U.S. companies. Moreover, foreign companies may not be subject to the same degree of regulation as are U.S. companies with
+respect to such matters as insider trading rules, tender offer regulation, shareholder proxy requirements and the timely disclosure of
+information.
+
+ 
+
+Legal principles relating
+to corporate affairs and the validity of corporate procedures, directors fiduciary duties and liabilities and shareholders 
+rights for foreign corporations may differ from those that may apply in the U.S., which may make the consummation of a business combination
+with a foreign company more difficult. We therefore may have more difficulty in achieving our business objective.
+
+ 
+
+ 59
+
+ 
+
+ 
+
+ 
+
+Because a foreign judiciary may determine
+the scope and enforcement of almost all of our target business material agreements under the law of such foreign jurisdiction,
+we may be unable to enforce our rights inside and outside of such jurisdiction.
+
+ 
+
+The law of a foreign jurisdiction,
+may govern almost all of our target business material agreements, some of which may be with governmental agencies in such jurisdiction.
+We cannot assure you that the target business or businesses will be able to enforce any of their material agreements or that remedies
+will be available outside of such jurisdiction. The inability to enforce or obtain a remedy under any of our future agreements may have
+a material adverse impact on our future operations.
+
+ 
+
+A slowdown in economic growth in the markets
+that our business target operates in may adversely affect our business, financial condition, results of operations, the value of its
+equity shares and the trading price of our shares following our business combination.
+
+ 
+
+Following the business combination,
+our results of operations and financial condition may be dependent on, and may be adversely affected by, conditions in financial markets
+in the global economy, and, particularly in the markets where the business operates. The specific economy could be adversely affected
+by various factors such as political or regulatory action, including adverse changes in liberalization policies, business corruption,
+social disturbances, terrorist attacks and other acts of violence or war, natural calamities, interest rates, inflation, commodity and
+energy prices and various other factors which may adversely affect our business, financial condition, results of operations, value of
+our equity shares and the trading price of our shares following the business combination.
+
+ 
+
+Regional hostilities, terrorist attacks,
+communal disturbances, civil unrest and other acts of violence or war may result in a loss of investor confidence and a decline in the
+value of our equity shares and trading price of our shares following our business combination.
+
+ 
+
+Terrorist attacks, civil
+unrest and other acts of violence or war may negatively affect the markets in which we may operate our business following our business
+combination and also adversely affect the worldwide financial markets. In addition, the countries we will focus on, have from time to
+time experienced instances of civil unrest and hostilities among or between neighboring countries. Any such hostilities and tensions
+may result in investor concern about stability in the region, which may adversely affect the value of our equity shares and the trading
+price of our shares following our business combination. Events of this nature in the future, as well as social and civil unrest, could
+influence the economy in which our business target operates, and could have an adverse effect on our business, including the value of
+equity shares and the trading price of our shares following our business combination.
+
+ 
+
+The occurrence of natural disasters may
+adversely affect our business, financial condition and results of operations following our business combination.
+
+ 
+
+The occurrence of natural
+disasters, including hurricanes, floods, earthquakes, tornadoes, fires and pandemic disease may adversely affect our business, financial
+condition or results of operations following our business combination. The potential impact of a natural disaster on our results of operations
+and financial position is speculative, and would depend on numerous factors. The extent and severity of these natural disasters determines
+their effect on a given economy. Although the long term effect of diseases such as the H5N1 "avian flu," or H1N1, the swine
+flu, cannot currently be predicted, previous occurrences of avian flu and swine flu had an adverse effect on the economies of those countries
+in which they were most prevalent. An outbreak of a communicable disease in our market could adversely affect our business, financial
+condition and results of operations following our business combination. We cannot assure you that natural disasters will not occur in
+the future or that our business, financial condition and results of operations will not be adversely affected.
+
+ 
+
+Any downgrade of credit ratings of the
+country in which the company we acquire business may adversely affect our ability to raise debt financing following our business combination.
+
+ 
+
+No assurance can be given
+that any rating organization will not downgrade the credit ratings of the sovereign foreign long-term debt of the country in which
+our business target operates, which reflect an assessment of the overall financial capacity of the government of such country to pay
+its obligations and its ability to meet its financial commitments as they become due. Any downgrade could cause interest rates and borrowing
+costs to rise, which may negatively impact both the perception of credit risk associated with our future variable rate debt and our ability
+to access the debt markets on favorable terms in the future. This could have an adverse effect on our financial condition following our
+business combination.
+
+ 
+
+Returns on investment in foreign companies
+may be decreased by withholding and other taxes.
+
+ 
+
+Our investments will incur
+tax risk unique to investment in developing economies. Income that might otherwise not be subject to withholding of local income tax
+under normal international conventions may be subject to withholding of income tax in a developing economy. Additionally, proof of payment
+of withholding taxes may be required as part of the remittance procedure. Any withholding taxes paid by us on income from our investments
+in such country may or may not be creditable on our income tax returns. We intend to seek to minimize any withholding tax or local tax
+otherwise imposed. However, there is no assurance that the foreign tax authorities will recognize application of such treaties to achieve
+a minimization of such tax. We may also elect to create foreign subsidiaries to effect the business combinations to attempt to limit
+the potential tax consequences of a business combination.
+
+ 
+
+ 60
+
+ 
+
+ 
+
+ 
+
+As the rights of shareholders under British
+Virgin Islands law differ from those under U.S. law, you may have fewer protections as a shareholder.
+
+ 
+
+We are a company incorporated
+under the laws of the British Virgin Islands. As a result, it may be difficult for investors to enforce judgments obtained in the United
+States courts against our directors or officers.
+
+ 
+
+Our corporate affairs will
+be governed by our memorandum and articles of association, the Companies Act, and the common law of the British Virgin Islands. The rights
+of shareholders to take legal action against our directors, actions by minority shareholders and the fiduciary responsibilities of our
+directors under British Virgin Islands law are governed by the Companies Act and the common law of the British Virgin Islands. The common
+law of the British Virgin Islands is derived from the common law of England and whilst the decision of the English courts are of persuasive
+authority, they are not binding on a court in the British Virgin Islands. The rights of our shareholders and the fiduciary responsibilities
+of our directors under British Virgin Islands law may not be as clearly established as they would be under statutes or judicial precedents
+in some jurisdictions in the United States. In particular, the British Virgin Islands has a less developed body of securities laws as
+compared to the United States, and some states (such as Delaware) have more fully developed and judicially interpreted bodies of corporate
+law. As a result of all of the above, holders of our shares may have more difficulty in protecting their interests through actions against
+our management, directors or major shareholders than they would as shareholders of a U.S. company.
+
+ 
+
+Risks Relating to Our Corporate Structure
+
+ 
+
+We are not subject to the supervision of
+the Financial Services Commission of the British Virgin Islands and so our shareholders are not protected by any regulatory inspections
+in the British Virgin Islands.
+
+ 
+
+We are not an entity subject
+to any regulatory supervision in the British Virgin Islands by the Financial Services Commission. As a result, shareholders are not protected
+by any regulatory supervision or inspections by any regulatory agency in the British Virgin Islands and the company is not required to
+observe any restrictions in respect of its conduct save as disclosed in this prospectus or its memorandum and articles of association.
+
+ 
+
+ 61
+
+ 
+
+ 
+
+ 
+
+Because we are incorporated under the laws
+of the British Virgin Islands, you may face difficulties in protecting your interests, and your ability to protect your rights through
+the U.S. Federal courts may be limited.
+
+ 
+
+We are a company incorporated
+under the laws of the British Virgin Islands. As a result, it may be difficult for investors to effect service of process within the
+United States upon our directors or officers, or enforce judgments obtained in the United States courts against our directors or officers.
+
+ 
+
+Our corporate affairs and
+the rights of shareholders are governed by our amended and restated memorandum and articles of association, the Companies Act and the
+common law of the British Virgin Islands. The rights of shareholders to take action against the directors, actions by minority shareholders
+and the fiduciary responsibilities of our directors to us under British Virgin Islands law are governed by the Companies Act and the
+common law of the British Virgin Islands. The common law of the British Virgin Islands is derived from English common law, and whilst
+the decisions of the English courts are of persuasive authority, they are not binding on a court in the British Virgin Islands. The rights
+of our shareholders and the fiduciary responsibilities of our directors under British Virgin Islands law may not be as clearly established
+as they would be under statutes or judicial precedent in some jurisdictions in the U.S. In particular, the British Virgin Islands has
+a less developed body of securities laws as compared to the U.S., and certain states, such as Delaware, may have more fully developed
+and judicially interpreted bodies of corporate law. In addition, while statutory provisions do exist in British Virgin Islands law for
+derivative actions to be brought in certain circumstances, shareholders in British Virgin Islands companies may not have standing to
+initiate a shareholder derivative action in a Federal court of the United States. Accordingly, shareholders may have fewer alternatives
+available to them if they believe that corporate wrongdoing has occurred.
+
+ 
+
+The courts of the British Virgin Islands are
+also unlikely:
+
+ 
+
+ 
+ 
+ 
+ to recognize or enforce against
+ us judgments of courts of the United States based on certain civil liability provisions of U.S. securities laws where that liability
+ is in respect of penalties, taxes, fines or similar fiscal or revenue obligations of the company; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ to impose liabilities against us, in original
+ actions brought in the British Virgin Islands, based on certain civil liability provisions of U.S. securities laws that are penal
+ in nature.
+
+ 
+ 
+
+There is no statutory recognition
+in the British Virgin Islands of judgments obtained in the United States, although the courts of the British Virgin Islands will in certain
+circumstances recognize such a foreign judgment and treat it as a cause of action in itself which may be sued upon as a debt at common
+law so that no retrial of the issues would be necessary provided that the U.S. judgment:
+
+ 
+
+ 
+ 
+ 
+ the U.S. court issuing the judgment
+ had jurisdiction in the matter and the company either submitted to such jurisdiction or was resident or carrying on business within
+ such jurisdiction and was duly served with process;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ is final and for a liquidated sum;
+
+ 
+ 
+
+ 
+ 
+ 
+ the judgment given by the U.S. court was not in respect
+ of penalties, taxes, fines or similar fiscal or revenue obligations of the company;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ in obtaining judgment there was no fraud on the part of the person
+ in whose favor judgment was given or on the part of the court;
+
+ 
+
+ 
+
+ 
+ 
+ 
+ recognition or enforcement of the judgment would not
+ be contrary to public policy in the British Virgin Islands; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the proceedings pursuant to which judgment was obtained were not
+ contrary to natural justice.
+
+ 
+ 
+
+ 62
+
+ 
+
+ 
+
+ 
+
+In appropriate circumstances,
+a British Virgin Islands Court may give effect in the British Virgin Islands to other kinds of final foreign judgments such as declaratory
+orders, orders for performance of contracts and injunctions.
+
+ 
+
+As a result of all of the
+above, public shareholders may have more difficulty in protecting their interests in the face of actions taken by management, members
+of the Board of Directors or controlling shareholders than they would as public shareholders of a U.S. company. For a discussion of certain
+differences between the provisions of the Companies Act, remedies available to shareholders and the laws applicable to companies incorporated
+in the United States and their shareholders, see "British Virgin Islands Company Considerations."
+
+ 
+
+General Risk Factors
+
+ 
+
+We are a newly incorporated company with
+no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective.
+
+ 
+
+We are a newly incorporated
+company established under the laws of the British Virgin Islands with no operating results, and we will not commence operations until
+obtaining funding through this offering. Because we lack an operating history, you have no basis upon which to evaluate our ability to
+achieve our business objective of completing our initial business combination with one or more target businesses. We have no plans, arrangements
+or understandings with any prospective target business concerning a business combination and may be unable to complete our initial business
+combination. If we fail to complete our initial business combination, we will never generate any operating revenues.
+
+ 
+
+Past performance by our management team
+and their respective affiliates may not be indicative of future performance of an investment in us.
+
+ 
+
+Information regarding performance
+by, or businesses associated with, our management team, our sponsors and their affiliates is presented for informational purposes only.
+Past experience and performance by our management team, including their affiliates past experience and performance, is not a guarantee
+either (i) of success with respect to any business combination we may consummate or (ii) that we will be able to locate a suitable
+candidate for our initial business combination. You should not rely on the historical record of our management team and their affiliates
+as indicative of our future performance. Additionally, in the course of their respective careers, members of our management team have
+been involved in businesses and deals that were unsuccessful. None of our officers or directors has had experience operating a blank
+check company in the past.
+
+ 
+
+Cyber incidents or attacks directed at
+us could result in information theft, data corruption, operational disruption and/or financial loss.
+
+ 
+
+We depend on digital technologies,
+including information systems, infrastructure and cloud applications and services, including those of third parties with which we may
+deal. Sophisticated and deliberate attacks on, or security breaches in, our systems or infrastructure, or the systems or infrastructure
+of third parties or the cloud, could lead to corruption or misappropriation of our assets, proprietary information and sensitive or confidential
+data. As an early stage company without significant investments in data security protection, we may not be sufficiently protected against
+such occurrences. We may not have sufficient resources to adequately protect against, or to investigate and remediate any vulnerability
+to, cyber incidents. It is possible that any of these occurrences, or a combination of them, could have adverse consequences on our business
+and lead to financial loss.
+
+ 
+
+We are an emerging growth company within
+the meaning of the Securities Act, and if we take advantage of certain exemptions from disclosure requirements available to emerging
+growth companies, this could make our securities less attractive to investors and may make it more difficult to compare our performance
+with other public companies.
+
+ 
+
+We are an "emerging
+growth company" within the meaning of the Securities Act, as modified by the JOBS Act, and we may take advantage of certain exemptions
+from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but
+not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act,
+reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the
+requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments
+not previously approved. As a result, our shareholders may not have access to certain information they may deem important. We could be
+an emerging growth company for up to five years, although circumstances could cause us to lose that status earlier, including if the
+market value of our ordinary shares held by non-affiliates exceeds $700 million as of any December 31 before that time, in which
+case we would no longer be an emerging growth company as of the following June 30. We cannot predict whether investors will find
+our securities less attractive because we will rely on these exemptions. If some investors find our securities less attractive as a result
+of our reliance on these exemptions, the trading prices of our securities may be lower than they otherwise would be, there may be a less
+active trading market for our securities and the trading prices of our securities may be more volatile. 
+
+ 
+
+ 63
+
+ 
+
+ 
+
+ 
+
+Further, Section 102(b)(1) of
+the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until
+private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class
+of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS
+Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging
+growth companies but any such an election to opt out is irrevocable. We have elected not to opt out of such extended transition period
+which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as
+an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This
+may make comparison of our financial statements with another public company which is neither an emerging growth company nor an emerging
+growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences
+in accountant standards used.
+
+ 
+
+We may be a passive foreign investment company, or "PFIC,"
+which could result in adverse U.S. federal income tax consequences to U.S. investors.
+
+ 
+
+If we are a PFIC for any
+taxable year (or portion thereof) that is included in the holding period of a U.S. holder (as defined in the section of this prospectus
+captioned "Income Tax Considerations Certain U.S. Federal Income Tax Considerations U.S. Holders") of our
+Class A ordinary shares, warrants or rights, the U.S. holder may be subject to adverse U.S. federal income tax consequences and
+may be subject to additional reporting requirements. Our PFIC status for our current and subsequent taxable years may depend on whether
+we qualify for the PFIC start-up exception (see the section of this prospectus captioned "Income Tax Considerations Certain
+U.S. Federal Income Tax Considerations U.S. Holders Passive Foreign Investment Company Rules"). Depending on the
+particular circumstances the application of the start-up exception may be subject to uncertainty, and there cannot be any assurance that
+we will qualify for the start-up exception. Accordingly, there can be no assurances with respect to our status as a PFIC for our current
+taxable year or any subsequent taxable year. Our actual PFIC status for any taxable year, however, will not be determinable until after
+the end of such taxable year. Moreover, if we determine we are a PFIC for any taxable year, we will endeavor to provide to a U.S. holder
+such information as the Internal Revenue Service ("IRS") may require, including a PFIC annual information statement, in order
+to enable the U.S. holder to make and maintain a "qualified electing fund" election, but there can be no assurance that we
+will timely provide such required information, and such election would be possibly unavailable with respect to our warrants and possibly
+not our rights. We urge U.S. holders to consult their own tax advisors regarding the possible application of the PFIC rules to holders
+of our Class A ordinary shares, warrants and rights. For a more detailed explanation of the tax consequences of PFIC classification
+to U.S. holders, see the section of this prospectus captioned "Income Tax Considerations Certain U.S. Federal Income Tax
+Considerations U.S. Holders Passive Foreign Investment Company Rules."
+
+ 
+
+ 64
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/ASRE_astra_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/ASRE_astra_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..063eb94636a55f136a31d8719d55d67e1a6d614b
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/ASRE_astra_prospectus_summary.txt
@@ -0,0 +1,73 @@
+PROSPECTUS SUMMARY
+ 
+ You should read the following summary together with the more detailed information and the financial statements appearing elsewhere in this Prospectus. This Prospectus contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth under Risk Factors and elsewhere in this Prospectus. Unless the context indicates or suggests otherwise, references to we, our, us, the Company, or the Registrant refer to Astra Energy, Inc, a Nevada corporation. If anyone provides you with different or inconsistent information, you should not rely on it. We are not making an offer to sell these securities in any jurisdiction where offer or sale is not permitted. You should assume that the information appearing in this prospectus is accurate only as of the date on the front cover of this prospectus. Our business, financial condition, results of operations and prospects may have changed since that date.
+ 
+ Astra Energy, Inc.
+ 
+ Astra Energy is an emerging company within the electricity generation and transmission sector with a focus on energy production from solar, waste conversion and clean burning fuels. The Company strives to advance clean energy initiatives globally while delivering measurable benefits to communities and value to our investors by investing in and developing renewable and clean energy projects in markets where demand is high and supply is limited.
+ 
+ We are cultivating a portfolio of intellectual property and global licenses for innovative renewable energy technology and generating projects to deploy that technology. 
+ 
+ The Company s corporate strategy is rooted in securing technologies and assets, identifying viable market opportunities and bringing together resources, expertise, technology and defined action plans to execute projects that benefit the planet, communities, local economies and investors.
+ 
+ Astra Energy identifies and develops clean energy and renewable energy projects in underserved markets around the world. The Company focuses on end-to-end development, including:
+ 
+ 
+ 
+ Identifying, acquiring, and developing physical land assets in strategic locations and markets
+
+ 
+ 
+ Relationship building with local governments and community stakeholders
+
+ 
+ 
+ Procuring contractors and professionals to design, develop, and construct the project
+
+ 
+ 
+ Capitalizing the project through financing and incentives such as carbon credits
+
+ 
+ 
+ Power grid interconnection
+
+ 
+ 
+ Power marketing
+
+ 
+ 
+ Ongoing operations
+
+ 
+ 
+ Project refinancing and sale
+
+ 
+ 
+ Project financing and sale
+
+ 
+ 
+ 
+ History
+ 
+ The Company was incorporated in the State of Nevada on June 12, 2000, under the name Fresh Air.com Inc. In February 2003, the Company changed its name to Heritage Management, Inc. On March 2, 2009, the issuer s name was changed to Edgewater Foods International, Inc. On February 27, 2018, the name was changed to Ocean Smart Inc. On April 24, 2020, the Company was reinstated in the State of Nevada the name of the Company was changed to Artic Motion, Inc. Effective, May 22, 2020, the Company changed its name to Astra Energy Inc. The Company is currently in good standing in Nevada. 
+ 
+ On August 24, 2020, the Company effected a reverse stock split of its authorized shares of common stock on a 1:50 basis. On August 24, 2020, the Company effected a reverse stock split of its authorized shares of Series A preferred stock on a 1:1,000 basis. 
+ 
+ The Company has an accumulated deficit at February 28, 2022 of $31,338,085 and except for a one-time non-refundable deposit received pursuant to a pending solar panel sales and installation agreement, has no current revenue generating operations. We expect to incur substantial expenses and generate continued operating losses until we generate revenues sufficient to meet our obligations. These factors raise substantial doubt as to the Company s ability to continue as a going concern. We will need to rely on private capital investment to fund on-going operations for the near term. There is no guarantee that we will be able to secure private capital investment.
+ 
+ 
+ 4
+ 
+
+ Table of Contents
+
+ 
+ 
+ 
+ Our principal executive offices are located at 9565 Waples Street, Suite 200, San Diego, CA 92121. Our telephone number is (800) 705 2919. Our website is www.astraenergyinc.com. Information on or accessed through our website is not incorporated into this prospectus and is not a part of this prospectus.
+ 
+ <a name="
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/ATVK_ameritek_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/ATVK_ameritek_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..4af3b8ba479a0a323ac3635af58d05f75c9f55e8
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/ATVK_ameritek_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that may be important to you. You should read this entire prospectus carefully, including the sections entitled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations and the Company s historical financial statements and related notes included elsewhere in this prospectus. In this prospectus, unless otherwise noted, the terms the Company, Ameritek, we, us, and our refer to Ameritek Ventures, Inc. and its subsidiaries. Overview Ameritek Ventures, Inc. is the parent of group of wholly-owned companies in the business of the research and development of advanced technology for future use, such as blockchain technology, robotic systems, metaverse and city-wide aerial transportation vehicles. The Company has also developed and is marketing certain technologically advanced products beneficial to businesses, organizations, and governments in a variety of industries, such as the DittoMask high filtration face mask and the FlexFridge portable mini-fridge. We also seek value adding businesses or technologies for acquisition. Through our wholly-owned subsidiaries: we currently provide complex warehouse management solutions to customers; we created the DittoMask high-filtration face mask for which we are currently seeking an N95 certification; we created the FlexFridge portable use mini-fridge the prototype of which is currently being tested; we are developing blockchain technology software programs for use in the health and legal fields; we are developing augmented reality robotics technology; we are developing a vertical landing aircraft service for a members-only passenger first-class transport across cities, and we seek value adding business or technologies for acquisition. We also search for target technology companies that can expand our business into new product lines and markets and work with financial partners to fund projects. See Business for information about our business. See and Risk Factors for a description of the risks associated with investing in our Company. Recent Developments Prior to November 2020, the Company was in the business of fiber optics, however, this business vanquished due to the former directors and officers of the Company failing to adequately pursue the business. In late October and early November of 2020, Shaun Passley PhD., as a shareholder and director of both the Company and VW Winn Century, Inc. ( VWin ), sought to rehabilitate both the Company and VWin pursuant to the laws of the State of Nevada, as described below in Company Rehabilitations. Subsequently, as described below, on November 27, 2020, VWin was merged with the Company pursuant to an agreement and plan of merger, with the Company as the surviving entity. On November 27, 2020, Bozki, Inc. ( Bozki ), a company controlled by Dr. Passley, was merged with the Company pursuant to an agreement and plan of merger, with the Company as the surviving entity. On May 14, 2021, we acquired Interactive Systems, Inc. ( Interactive ), which provides warehouse management solutions to businesses. On October 1, 2021, we acquired interlinkONE. ( interlinkONE ), which provides warehouse, order and inventory management solutions. Company Rehabilitations VWin The information in this prospectus is not complete and may be changed. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state or jurisdiction where the offer or sale is not permitted. DATED March 16, 2022 PROSPECTUS AMERITEK VENTURES, INC. 514,226,791 Shares of Common Stock This prospectus relates to the disposition from time to time of up to 514,226,791 shares of our common stock, par value $0.001 per share (the Shares ), which includes 15,426,801 Shares which are held by the selling stockholders (the Selling Stockholders ) identified in the prospectus, including their transferees, pledgees or donees or their respective successors. We are not selling any common stock under this prospectus and will not receive any of the proceeds from the sale of Shares by the Selling Stockholders. We will bear all costs relating to the registration of the Shares other than any legal or accounting costs or commissions of the Selling Stockholders. Registered stockholders other than the Selling Stockholders may elect to sell shares of our common stock covered by this prospectus. To the extent any registered stockholder chooses to sell shares of our common stock covered by this prospectus, we will not receive any proceeds from any such sales. Our common stock is currently quoted on the OTC Expert Market and we plan to apply to list our common stock on the OTCQB market of the OTC Markets Group, Inc. The Selling Stockholders may sell their Shares at privately-negotiated prices in accordance with the Securities Act of 1933, as amended (the Securities Act ) until our Shares are quoted on the OTCQB, and thereafter, at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale, or at negotiated prices, including, without limitation, in one or more transactions that may take place by ordinary brokerage transactions, privately-negotiated transactions or through sales to one or more underwriters or broker-dealers for resale. We provide more information about how a Selling Stockholder may sell its shares of common stock in the section titled Plan of Distribution on page 42. Our common stock was registered under Section 12g of the Securities Exchange Act of 1934, as amended (the Exchange Act ) with the Securities and Exchange Commission (the SEC ) and was quoted on the OTC Pink tier of the OTC Markets Group, Inc. under the symbol ATVK until May 14, 2021.We subsequently terminated the registration of our common stock with the SEC and delisted from the OTC Pink tier (migrating to the OTC Expert Market) in contemplation of the filing of this registration statement subsequent to the rehabilitation of our Company carried out under Court proceedings in the State of Nevada and subsequent restructuring of our Company as described under Business Recent Developments. We are an smaller reporting company as that term is defined in the Exchange Act and, as such, have certain reduced public company reporting requirements. Investing in our common stock involves a high degree of risk. See the section entitled Risk Factors beginning on page 1010 of this prospectus and elsewhere in this prospectus for a discussion of information that should be considered in connection with an investment in our common stock. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read the entire prospectus and any amendments or supplements carefully before you make your investment decision. Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. The date of this prospectus is March 16, 2022 SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This prospectus contains forward-looking statements. These forward-looking statements contain information about our expectations, beliefs or intentions regarding our product development and commercialization efforts, business, financial condition, results of operations, strategies or prospects, and other similar matters. These forward-looking statements are based on management s current expectations and assumptions about future events, which are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. These statements may be identified by words such as expects, plans, projects, will, may, anticipates, believes, should, intends, estimates, and other words of similar meaning. These statements relate to future events or our future operational or financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. Factors that may cause actual results to differ materially from current expectations include, among other things, those listed under the section titled Risk Factors and elsewhere in this prospectus, in any related prospectus supplement and in any related free writing prospectus. Any forward-looking statement in this prospectus, in any related prospectus supplement and in any related free writing prospectus reflects our current view with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our business, results of operations, industry and future growth. Given these uncertainties, you should not place undue reliance on these forward-looking statements. No forward-looking statement is a guarantee of future performance. You should read this prospectus, any related prospectus supplement and any related free writing prospectus and the documents that we reference herein and therein and have filed as exhibits hereto and thereto completely and with the understanding that our actual future results may be materially different from any future results expressed or implied by these forward-looking statements. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future. This prospectus, any related prospectus supplement and any related free writing prospectus also contain or may contain estimates, projections and other information concerning our industry, our business and the markets for our products, including data regarding the estimated size of those markets and their projected growth rates. We obtained the industry and market data in this prospectus from our own research as well as from industry and general publications, surveys and studies conducted by third parties. This data involves a number of assumptions and limitations and contains projections and estimates of the future performance of the industries in which we operate that are subject to a high degree of uncertainty, including those discussed in Risk Factors. We caution you not to give undue weight to such projections, assumptions and estimates. Further, industry and general publications, studies and surveys generally state that they have been obtained from sources believed to be reliable, although they do not guarantee the accuracy or completeness of such information. While we believe that these publications, studies and surveys are reliable, we have not independently verified the data contained in them. In addition, while we believe that the results and estimates from our internal research are reliable, such results and estimates have not been verified by any independent source. PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that may be important to you. You should read this entire prospectus carefully, including the sections entitled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations and the Company s historical financial statements and related notes included elsewhere in this prospectus. In this prospectus, unless otherwise noted, the terms the Company, Ameritek, we, us, and our refer to Ameritek Ventures, Inc. and its subsidiaries. Overview Ameritek Ventures, Inc. is the parent of group of wholly-owned companies in the business of the research and development of advanced technology for future use, such as blockchain technology, robotic systems, metaverse and city-wide aerial transportation vehicles. The Company has also developed and is marketing certain technologically advanced products beneficial to businesses, organizations, and governments in a variety of industries, such as the DittoMask high filtration face mask and the FlexFridge portable mini-fridge. We also seek value adding businesses or technologies for acquisition. Through our wholly-owned subsidiaries: we currently provide complex warehouse management solutions to customers; we created the DittoMask high-filtration face mask for which we are currently seeking an N95 certification; we created the FlexFridge portable use mini-fridge the prototype of which is currently being tested; we are developing blockchain technology software programs for use in the health and legal fields; we are developing augmented reality robotics technology; we are developing a vertical landing aircraft service for a members-only passenger first-class transport across cities, and we seek value adding business or technologies for acquisition. We also search for target technology companies that can expand our business into new product lines and markets and work with financial partners to fund projects. See Business for information about our business. See and Risk Factors for a description of the risks associated with investing in our Company. Recent Developments Prior to November 2020, the Company was in the business of fiber optics, however, this business vanquished due to the former directors and officers of the Company failing to adequately pursue the business. In late October and early November of 2020, Shaun Passley PhD., as a shareholder and director of both the Company and VW Winn Century, Inc. ( VWin ), sought to rehabilitate both the Company and VWin pursuant to the laws of the State of Nevada, as described below in Company Rehabilitations. Subsequently, as described below, on November 27, 2020, VWin was merged with the Company pursuant to an agreement and plan of merger, with the Company as the surviving entity. On November 27, 2020, Bozki, Inc. ( Bozki ), a company controlled by Dr. Passley, was merged with the Company pursuant to an agreement and plan of merger, with the Company as the surviving entity. On May 14, 2021, we acquired Interactive Systems, Inc. ( Interactive ), which provides warehouse management solutions to businesses. On October 1, 2021, we acquired interlinkONE. ( interlinkONE ), which provides warehouse, order and inventory management solutions. Company Rehabilitations VWin On October 26, 2020, as a shareholder of the VWin, Dr. Passley filed a Notice of Motion to Appoint Custodian with the Eight Judicial District Court, Clark Count, Nevada (the Court ) as it was stipulated that the officers and directors of VWin abandoned the business, its shareholders and the VWin. At the hearing, the Court ordered that (i) Dr. Passley be appointed the Custodian of VWin, (ii) Dr. Passley reinstate VWin with the Nevada Secretary of State, (iii) Dr. Passley appoint directors and officers of VWin to serve during his Custodianship, (iv) Dr. Passley be authorized to take action on behalf of VWin, including with respect to compromising debt, executing contracts, and authorizing, issuing, eliminating, or amending terms of common of preferred shares of VWin, as well as initiating litigation on behalf of VWin. In addition, Dr. Passley was authorized to provide reasonable notice to shareholders of VWin of a meeting of shareholders. Dr. Passley, as the Custodian of the Company, shortly after the hearing of the motion reinstated VWin with the Nevada Secretary of State. Dr. Passley was appointed as the Chief Executive Officer and sole director of VWin on October 29, 2020. On the same day, Dr. Passley filed to suspend reporting and terminate VWin s registration of its securities registered under Section 12 of the Securities Act of 1933, as amended (the Securities Act ) with the Securities and Exchange Commission (the SEC ) and made an Offer of Settlement of proceedings commenced against VWin by the SEC in August 2019 for failure to comply with the disclosure requirements under section 13(a) of the Securities Act. As a result, on November 5, 2020, the SEC revoked the registration of each class of securities registered by VWin under Section 12 of the Securities Act. Dr. Passley, as the Custodian of VWin and Ameritek Ventures then submitted the Board of Directors a stock merger plan with Ameritek Ventures, Inc., with Ameritek Ventures, Inc. being the only surviving company. Ameritek In November 2020, as a shareholder of the Company, Dr. Passley filed a Notice of Motion to Appoint Custodian with the Eight Judicial District Court, Clark Count, Nevada as it was stipulated that the officers and directors of the Company abandoned the business, its shareholders and the Company. At the hearing, the Court ordered that (i) Dr. Passley be appointed the Custodian of the Company, (ii) Dr. Passley reinstate the Company with the Nevada Secretary of State, (iii) Dr. Passley appoint directors and officers of the Company to serve during his Custodianship, (iv) Dr. Passley be authorized to take action on behalf of the Company, including with respect to compromising debt, executing contracts, and authorizing, issuing, eliminating, or amending terms of common of preferred shares of the Company, as well as initiating litigation on behalf of the Company. In addition, Dr. Passley was authorized to provide reasonable notice to shareholders of the Company of a meeting of shareholders. Dr. Passley, as the Custodian of the Company, shortly after the hearing of the motion reinstated the Company with the Nevada Secretary of State. On November 18, 2020, Dr. Passley filed to suspend the reporting requirements applicable to the Company pursuant to the Exchange Act as the number of holders of record of the Company s common stock was below 300 stockholders. The Company filed an amended Form 15 on May 14, 2021 to correct the number of stockholders. Subsequently, at a meeting of stockholders of the Company held on November 27, 2020, Dr. Passley was confirmed a director of the Company, as well as its President, CEO, Secretary and Treasurer by the Company s stockholders. In accordance with the powers afforded him by the Court, Dr. Passley, began an investigation into the Company s affairs to determine a path to its rehabilitation. During the investigation, it was discovered that the former President of the Company had issued more than 19 million shares to him in exchange for assets that were never delivered to the Company. As Custodian, Dr. Passley requested the Court to cancel these shares, which the Court subsequently ordered. Dr. Passley, as the Custodian of the Company, also filed a motion with the Court for an order that all claimants and creditors of the Company submit proofs of claim to the Custodian so that the Company can identify and resolve claims against it and plot a path forward. A total of six proofs of claim were submitted aggregating approximately $4.5 million in claims and $283,383 in attorney s fees, which were resolved by the Custodian. Dr. Passley was able to resolve all claims against the Company resulting in a gain on extinguishment of debt of $646,776 booked in 2021. Company Restructuring Further to the rehabilitation of the Company and VWin described above, VWin and Bozki, via two separate transactions, were merged with the Company, with the Company as the surviving entity of each transaction, as further described below. Each merger constituted a related party transaction as a result of the ownership interest of Dr. Passley in VWin, Bozki and the Company, as well as Dr. Passley acting as a director and officer in each company. In addition, the promissory notes issued by Bozki and VWin to Epazz, Inc. ( Epazz ) were assigned to the Company in connection with each of these transactions. Dr. Passley is a majority shareholder of Epazz. A copy of the plan of merger in respect of each transaction is attached as an exhibit hereto and the following descriptions thereof are qualified in their entirety by reference to the applicable plan of merger filed herewith. In addition, a copy of the agreements assigning the promissory notes to the Company under each transaction is attached as an exhibit hereto and the following descriptions thereof are qualified in their entirety by reference to the applicable assignment agreement filed herewith. Investors are urged to carefully review each of these documents. Merger with Bozki On November 27, 2020, in accordance with required shareholder approvals, the Company completed a merger with Bozki, pursuant to an agreement and plan of merger between the Company and Bozki, with the Company as the surviving entity. Pursuant to the terms of the plan of merger, (i) each share of class A common stock of Bozki was automatically converted into three shares of common stock of the Company (ii) all holders of series A preferred stock of the Company received ten shares of common stock of the Company for each such preferred share, and these series A preferred shares were cancelled, (iii) the series A preferred shares of Bozki became the new series A preferred shares of the Company, with each share of series A preferred stock of Bozki being converted into ten series A preferred shares of the Company, (iv) the series B preferred shares of Bozki became the new series B preferred shares of the Company, with each share of series B preferred stock of Bozki being convertible into ten series B preferred shares of the Company, (v) the series C preferred shares of Bozki became the new series C preferred shares of the Company, with each share of series C preferred stock of Bozki being convertible into ten series A preferred shares of the Company, (vi) the class B common stock of Bozki became the new series E preferred shares of the Company, with each share of series B common stock of Bozki being convertible into one series E preferred share of the Company. In addition, on November 27, 2020, Bozki assigned two promissory notes in the aggregate amount of $1.2 million issued to Epazz to the Company pursuant to an Assignment Agreement among the Company, Bozki and Epazz. Merger with VWin On November 27, 2020, in accordance with required shareholder approvals obtained by the Ameritek Ventuers, the Company merged with VWin pursuant to an agreement and plan of merger between the Company and VWin, with the Ameritek Ventures, Inc. as the surviving entity. Pursuant to the terms of the plan of merger, the only consideration in connection with the merger was the assumption by the Company of a promissory note in the amount of $250,000 issued by VWin to Epazz made pursuant to an Assignment Agreement among the Company, VW Winn and Epazz. In addition, under the plan of merger, all stock of every class authorized and issued by VWin was cancelled. Acquisition of Interactive Systems, Inc. On May 14, 2021, we acquired all of the issued and outstanding shares of Interactive in consideration for $337,500 cash and issued a 6% amortizing two year note for $337,500. Through Interactive, we provide complex Warehouse Management Systems solutions. This includes WMS baseline software that assists in running all aspects of warehouse day-to-day operation as well as customized interfaces with automation and variety of material handling equipment. Acquisition of interlinkONE, Inc. On October 1, 2021, we acquired all of the issued and outstanding shares of interlinkONE, Inc., in consideration for $250,000 cash and issued a 6% amortizing two-year note for $250,000. Through interlinkONE, we strengthen our warehouse management solutions, providing responsive management, maintaining multiple warehouses and integrating them with solutions from WooCommerce, Salesforce, Zapier, QuickBooks and more. As a result, our corporate organization is now as follows (all subsidiaries are wholly owned by Ameritek): Implications of Being a Smaller Reporting Company As a smaller reporting company under the Exchange Act, we expect to take advantage of reduced reporting requirements that are otherwise applicable to public companies. Corporate Information Our principal executive offices are located at 325 N Milwaukee Ave. Suite G1, Wheeling IL 60090 and 401 Ryland Street, Suite 200A Reno, NV 89502 and our telephone number is (312) 239-3574. We maintain a website at www.ameritekventures.com. Information contained on or accessible through our website is not, and should not be considered, part of, or incorporated by reference into, this prospectus. The Offering This prospectus relates to the disposition from time to time of up to 514,226,791 shares of our common stock, par value $0.001 per share (the Shares ), which includes 15,426,801 Shares which are held by the selling stockholders (the Selling Stockholders ) identified in the prospectus, including their transferees, pledgees or donees or their respective successors. We are not selling any common stock under this prospectus and will not receive any of the proceeds from the sale of Shares by the Selling Stockholders. Registered stockholders other than the Selling Stockholders may elect to sell shares of our common stock covered by this prospectus. To the extent any registered stockholder chooses to sell shares of our common stock covered by this prospectus, we will not receive any proceeds from any such sales. Our common stock is currently quoted on the OTC Expert Market and we plan to apply to list our common stock on the OTCQB market of the OTC Markets Group, Inc. The Selling Stockholders may sell their Shares at privately-negotiated prices in accordance with the Securities Act of 1933, as amended (the Securities Act ) until our Shares are quoted on the OTCQB, and thereafter, at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale, or at negotiated prices, including, without limitation, in one or more transactions that may take place by ordinary brokerage transactions, privately-negotiated transactions or through sales to one or more underwriters or broker-dealers for resale. We provide more information about how a Selling Stockholder may sell its shares of common stock in the section titled Plan of Distribution on page 42. Investing in our common stock involves a high degree of risk. See the section entitled Risk Factors below and elsewhere in this prospectus for a discussion of information that should be considered in connection with an investment in our common stock.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/AUST_austin_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/AUST_austin_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..6a0a1084004cc7b99f2d99150b2cbbc1ca3386e8
--- /dev/null
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@@ -0,0 +1,203 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+This summary highlights information contained
+elsewhere in this prospectus and does not contain all of the information that may be important to you. You should read this entire prospectus
+carefully, including the sections entitled Risk Factors and Management s Discussion and Analysis of Financial
+Condition and Results of Operations and our historical financial statements and related notes included elsewhere in this prospectus.
+
+ 
+
+The information presented in this prospectus
+assumes that the Underwriters do not exercise their option to purchase additional common shares, unless otherwise indicated.
+
+ 
+
+Business Overview
+
+ 
+
+Austin Gold was incorporated under the Business
+Corporations Act (British Columbia) on April 21, 2020. Austin Gold is domiciled in Canada and maintains a head office in Vancouver, British
+Columbia, Canada. Austin Gold has no maximum authorized share capital and no par value.
+
+ 
+
+We are a gold exploration company focused
+on gold targets and making district-scale gold discoveries in Nevada. In specific, we were formed for the purposes of drilling the Kelly
+Creek Project (as described herein), a mineral exploration project located on the Battle Mountain-Eureka (Cortez) gold trend in Humboldt
+County, Nevada. Upon developing an understanding of the prospect of discovering deposits of precious or base metals on the property,
+we entered into the Kelly Creek LOI (hereinafter defined) on May 29, 2020. Thereafter, as described further herein, we entered into the
+JV Agreement. As a result of the foregoing, the Kelly Creek Project became our material mineral exploration project. Nonetheless, we
+continue to consider other regional opportunities to increase the opportunity for economic success, and in connection therewith we have
+acquired three other non-material mineral explorations projects. Our other projects are located on the Independence-Jerritt Canyon gold
+trend in Elko County, Nevada (the Lone Mountain Project), on the Carlin gold trend in Elko County, Nevada (the Miller Project), and in
+Nye County, Nevada situated in Oligocene volcanic rocks that are roughly the same age as those that host the large Round Mountain gold
+deposit (the Fourmile Basin Project).
+
+ 
+
+This is our initial public offering, and no
+public market currently exists for our common shares. The offering price may not reflect the market price of our common shares after
+this offering. Our common shares are not listed for trading on any exchange or automated quotation system.
+
+ 
+
+Austin Gold has submitted an application for
+listing its common shares for trading on the NYSE American under the symbol "AUST". We anticipate that our common shares
+will be traded on the NYSE American; however, there can be no assurance that our application for trading will be approved.
+
+ 
+
+For further information about Austin Gold, see
+the section entitled Business .
+
+ 
+
+Organizational Structure
+
+ 
+
+Austin Gold has one wholly-owned subsidiary,
+Austin American Corporation, a Nevada corporation.
+
+ 
+
+Mineral Properties
+
+ 
+
+Austin Gold s projects are located on the
+Battle Mountain Eureka (Cortez) gold trend in Humboldt County, Nevada (Kelly Creek Project), the Independence-Jerritt Canyon gold
+trend in Elko County, Nevada (Lone Mountain Project), on the Carlin gold trend in Elko County, Nevada (Miller Project), and in Nye County,
+Nevada situated in Oligocene volcanic rocks that are roughly the same age as those that host the large Round Mountain gold deposit (Fourmile
+Basin Project). Collectively these projects comprise the Austin Gold Properties . As of the date of this prospectus,
+the Austin Gold Properties comprise in aggregate 136.8 km2 of unpatented and patented mining claims and mineral tenure.
+
+ 
+
+Material Project
+
+ 
+
+The Kelly Creek Project
+
+ 
+
+The Kelly Creek Project is located in Humboldt
+County, Nevada. Austin Gold, through its subsidiary Austin American Corporation, has an Option to Joint Venture the Kelly Creek Project
+with Pediment Gold LLC ( Pediment ), a subsidiary of Nevada Exploration Inc. ( Nevada Exploration ),
+pursuant to which Austin American Corporation can acquire up to a 70% interest in the Kelly Creek Project. The Kelly Creek Project is
+currently Austin Gold s principal property and Austin Gold will be expending the largest amount of its exploration budget on the
+Kelly Creek Project over the next 12 months.
+
+ 
+
+Pediment combined its former Hot Pot Project
+into its Kelly Creek Project, which together are now referred to as the Kelly Creek Project, comprising of: (i) 333 unpatented lode mining
+claims held directly by Pediment, covering approximately 23.9 km2; (ii) 209 unpatented lode mining claims leased by Pediment
+from Genesis Gold Corporation through a Mining Lease and Option to Purchase Agreement (the Genesis Agreement ), covering
+approximately 15.1 km2; and (iii) approximately 14.2 km2 of private land leased by Pediment under a Mining Lease
+Agreement (the Hot Pot Lease ).
+
+ 
+
+See under heading "Description of Properties"
+in this prospectus, for a discussion of the Kelly Creek Project.
+
+ 
+
+Other Projects
+
+ 
+
+The Fourmile Basin Project
+
+ 
+
+The Fourmile Basin Project is located in Nye
+County, Nevada about 48 km east-northeast of the historic mining district and town of Tonopah (a district known for historical production
+of gold and silver). Fourmile Basin is localized along the southern margin of the +20 km diameter Big Ten Peak Caldera, which is one
+of multiple volcanic centers within the mid-Tertiary-age Central Nevada Volcanic Field. The Fourmile Basin Project comprises 312 unpatented
+lode mining claims covering approximately 26.1 km2.
+
+ 
+
+Austin
+Gold has a mineral lease agreement with La Cuesta International, Inc. related to the Fourmile Basin Project.
+
+ 
+
+See under heading "Description of Properties"
+in this prospectus, for a discussion of the Fourmile Basin Project.
+
+ 
+
+ 3
+
+ 
+
+ 
+
+ 
+
+The Lone Mountain Project
+
+ 
+
+The Lone Mountain Project is located near Lone
+Mountain in Elko County, Nevada. The Lone Mountain Project comprises 454 unpatented lode mining claims and 6 patented mining claims covering
+approximately 34.2 km2.
+
+ 
+
+Austin Gold has a lease with option to purchase
+with NAMMCO on the Lone Mountain Project.
+
+ 
+
+See under heading "Description of Properties"
+in this prospectus, for a discussion of the Lone Mountain Project.
+
+ 
+
+The Miller Project
+
+ 
+
+The
+Miller Project is located at the southern end of the Carlin trend on the eastern flank of the Pinion Range in Elko County, Nevada. The
+Miller Project consists of 117 claims in the original lease agreement, and an additional 164 claims which were staked in January of 2021
+for a total of 281 unpatented lode mining claims covering approximately 23.5 km2. Although the Company has filed the required
+documentation with the BLM and county as required, there is currently a dispute on the ownership of 134 of the newly staked claims and
+on 36 of the original claims. While there is no certainty on the outcome of the dispute, the Company believes it will be resolved in
+its favor.
+
+ 
+
+Austin Gold has a lease with option to purchase
+with Shea Clark Smith (trustee) and Gregory B. Maynard (trustee) on the Miller Project.
+
+ 
+
+See under heading "Description of Properties"
+in this prospectus, for a discussion of the Miller Project.
+
+ 
+
+Industry and Market Data and Forecasts
+
+ 
+
+The market data and certain other statistical
+information used throughout this prospectus are based on independent industry publications, government publications and other published
+independent sources. Although we believe these third-party sources are reliable as of their respective dates, neither we nor the Underwriters
+have independently verified the accuracy or completeness of this information. Some data is also based on our good faith estimates. The
+market data used in this prospectus involves a number of assumptions and limitations, and you are cautioned not to give undue weight
+to such estimates. Certain data is also based on our good faith estimates, which are derived from management s knowledge of the
+industry and independent sources. The industry in which we operate is subject to a high degree of uncertainty and risk due to a variety
+of factors, which could cause results to differ materially from those expressed in the estimates made by the independent parties and
+by us. While we are not aware of any misstatements regarding any market, industry or similar data presented herein, such data involves
+risks and uncertainties and is subject to change based on various factors, including those discussed under the headings
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/BEEM_beam_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/BEEM_beam_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..109031d28bc1a4822ecd28cee26539249505bcec
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/BEEM_beam_prospectus_summary.txt
@@ -0,0 +1 @@
+ii ABOUT THIS PROSPECTUS This prospectus is part of a registration statement on Form S-1 that we filed with the Securities and Exchange Commission (the SEC ) using the shelf registration process. Under this shelf registration process, B. Riley may, from time to time, sell the securities described in this prospectus. We will not receive any proceeds from the sale by such B. Riley of the securities described in this prospectus. You should rely only on the information contained in this prospectus or incorporated by reference into this prospectus, any supplement to this prospectus or in any free writing prospectus, filed with the SEC. Neither we nor B. Riley have authorized anyone to provide you with additional information or information different from that contained in this prospectus filed with the SEC. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. B. Riley is offering to sell our securities only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or any sale of our securities. Our business, financial condition, results of operations and prospects may have changed since that date. We may also provide a prospectus supplement or post-effective amendment to the registration statement to add information to, or update or change information contained in, this prospectus. Any statement so modified will be deemed to constitute a part of this prospectus only as so modified, and any statement so superseded will be deemed not to constitute a part of this prospectus. You should read both this prospectus and any applicable prospectus supplement or post-effective amendment to the registration statement together with the additional information to which we refer you in the section titled Where You Can Find Additional Information. For investors outside of the United States: Neither we nor B. Riley have done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of our securities and the distribution of this prospectus outside the United States. Unless otherwise stated or the context requires otherwise, references in this prospectus to Beam, the Company, we, us, or our refer to Beam Global. This prospectus and the information incorporated herein by reference include trademarks, service marks and trade names owned by us or other companies. All trademarks, service marks and trade names included or incorporated by reference into this prospectus, any applicable prospectus supplement or any related free writing prospectus, are the property of their respective owners. 1 SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This report contains forward-looking statements that are based on current expectations, estimates, forecasts, and projections about us, the industry in which we operate and other matters, as well as management's beliefs and assumptions and other statements regarding matters that are not historical facts. These statements include, in particular, statements about our plans, strategies and prospects. For example, when we use words such as projects, expects, anticipates, intends, plans, believes, seeks, estimates, should, would, could, will, opportunity, potential or may, and variations of such words or other words that convey uncertainty of future events or outcomes, we are making forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 (Securities Act) and Section 21E of the Securities Exchange Act of 1934, as amended (Exchange Act). However, the absence of these words does not mean that a statement is not forward-looking. These forward-looking statements are subject to numerous assumptions, risks and uncertainties that may cause the Company s actual results to be materially different from any future results expressed or implied by the Company in those statements. The most important factors that could prevent the Company from achieving its stated goals include, but are not limited to, the following: (a) volatility or decline of the Company s stock price, or absence of stock price appreciation; (b) fluctuation in quarterly results; (c) failure of the Company to earn revenues or profits; (d) unavailability of capital or financing to prospective customers of the Company to enable them to purchase products and services from the Company; (e) failure to commercialize the Company s technology or to make sales; (f) reductions in demand for the Company s products and services, whether because of competition, general industry conditions, loss of tax incentives, technological obsolescence or other reasons; (g) litigation with or legal claims and allegations by outside parties; (h) insufficient revenues to cover operating costs, resulting in persistent losses; (i) rapid and significant changes to costs of raw materials from government tariffs or other market factors; and (j) increasing spread of the COVID-19 pandemic and its impact on the Company s business as well as worldwide financial markets. The foregoing list of risks is not exhaustive and are based on information available as of the date of this prospectus and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date. Other sections of this prospectus may include additional factors that could harm our business and financial performance. Moreover, we operate in an evolving environment. New risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties. As a result of these factors, we cannot assure you that the forward-looking statements in this prospectus will prove to be accurate. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances or otherwise. 2 Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified and some of which are beyond our control, you should not rely on these forward-looking statements as predictions of future events. Although we believe that we have a reasonable basis for each forward-looking statement contained in this prospectus, the events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements. You should refer to the section titled Risk Factors for a discussion of important factors that may cause our actual results to differ materially from those expressed or implied by our forward-looking statements. In addition, statements that we believe and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this prospectus and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and such statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain and investors are cautioned not to unduly rely upon these statements. You should read this prospectus and the documents that we reference in this prospectus and have filed as exhibits to the registration statement, of which this prospectus is a part, completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. 3 PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our securities, you should carefully read this entire prospectus, including our
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diff --git a/parsed_sections/prospectus_summary/2022/BHVN_biohaven_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/BHVN_biohaven_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/BLCO_bausch_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/BLCO_bausch_prospectus_summary.txt
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2022/BLTE_belite_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/BLTE_belite_prospectus_summary.txt
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2022/BNCWW_cea_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/BNCWW_cea_prospectus_summary.txt
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+S-1 1 forms-1.htm As filed with the Commission on September 22, 2022 Registration No. 333- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 CEA INDUSTRIES INC. (formerly known as Surna Inc.) (Exact name of registrant as specified in its charter) Nevada 0700 27-3911608 (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification No.) 385 South Pierce Avenue, Suite C Louisville, Colorado 80027 (303) 993-5271 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Anthony K. McDonald Chief Executive Officer CEA Industries Inc. 385 South Pierce Avenue, Suite C Louisville, Colorado 80301 (303) 993-5271 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Andrew D. Hudders Golenbock Eiseman Assor Bell & Peskoe LLP 711 Third Avenue, 17th Floor New York, NY 10017 (212) 907-7300 Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box: If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Non-accelerated filer Accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PROSPECTUS Subject to Completion, Dated September 22, 2022 CEA INDUSTRIES INC. 6,863,365 Shares of Common Stock Issuable Upon the Exercise of Warrants This prospectus relates to 6,572,808 shares of common stock issuable upon the exercise of warrants issued to investors in our public offering (the "Public Warrants") and 290,557 shares of common stock issuable upon exercise of warrants issued to the representatives of the underwriters (the "Underwriter Warrants") on February 10, 2022. Together the Public Warrants and the Underwriter Warrants are sometimes herein collectively referred to as the "Warrants"). Our common stock is traded on Nasdaq Capital Market under the symbol "CEAD." On September 21, 2022, the last reported sales price of the common stock was $1.13 per share. The Public Warrants trade on the Nasdaq Capital Market under the symbol "CEADW." On September 21, 2022, the last reported sales price of the Public Warrants was $0.135 per warrant. The Underwriter Warrants are not listed for trading on any exchange. Investing in our securities involves a high degree of risk. See "Risk Factors" beginning on page 5 of this prospectus and the risk factors in the documents incorporated by reference in this prospectus to read about factors you should consider before deciding to invest in our securities. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is September 22, 2022 TABLE OF CONTENTS Page Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2022/BWMN_bowman_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/BWMN_bowman_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
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+++ b/parsed_sections/prospectus_summary/2022/BWMN_bowman_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/BYNOW_bynordic_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/BYNOW_bynordic_prospectus_summary.txt
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+Certain qualified institutional buyers or institutional accredited investors, which we refer to as the anchor investors (none of which are affiliated with any member of our management team, our sponsor or any other anchor investor), have expressed to us an interest in purchasing in the aggregate up to approximately $146.4 million of the units which is approximately 97.6% of the units in this offering at the public offering price; provided, that no more than $14.85 million of the units in this offering shall be purchased by each anchor investor in such manner. Our sponsor and byNordic Holdings will sell to the anchor investors (or forfeit to us for us to sell to the anchor investors) on a pro rata basis according to their respective ownership of shares of our Class B common stock up to 1,109,091 shares of our Class B common stock subject to the purchase by the anchor investors of their respective allocations of the units. If the anchor investors purchase all of the units for which they have expressed to us an interest in purchasing, substantially all of the units purchased in this offering will be held by the anchor investors. The anchor investors will potentially have different interests than our other public stockholders in approving our initial business combination and otherwise exercising their rights as public stockholders because of their ownership of our Class B common stock as further discussed in this prospectus. In particular, the anchor investors would have an incentive to approve an initial business combination before the deadline for us to complete an initial business combination because otherwise their Class B common stock will expire worthless. If the anchor investors purchase substantially all of the units in this offering, the ownership of the units by a limited number of investors would be expected to reduce the trading volume, increase volatility and reduce liquidity for the remaining investors in our units and prevent the remaining investors from influencing whether to approve our initial business combination and other significant corporate decisions as explained in more detail under Risk Factors The anchor investors have expressed an interest to purchase substantially all of the units in this offering, which could reduce the trading volume, volatility and liquidity for our shares, adversely affect the trading price of our shares and prevent other investors from influencing significant corporate decisions and Since our anchor investors will acquire founder shares held by our sponsor and byNordic Holdings, a conflict of interest may arise in determining whether a particular target business is appropriate for our initial business combination. In addition, if the anchor investors purchase substantially all of the units in this offering, we would be at greater risk of not maintaining the minimum required number of holders of our units that is required to maintain our listing on Nasdaq and we could be delisted by Nasdaq as explained in more detail under Risk Factors Nasdaq may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities and subject us to additional trading restrictions. Since our sponsor and byNordic Holdings are either transferring or forfeiting shares of our Class B common stock held by themselves without the issuance of additional shares of Class B common stock by us, there will be no additional dilutive impact on the other investors in this offering from the sale of the Class B common stock to the anchor investors. There can be no assurance that the anchor investors will acquire any units in this offering, or as to the amount of such units the anchor investors will retain, if any, prior to or upon the consummation of our initial business combination. In addition, none of the anchor investors has any obligation to vote any of their public shares in favor of our initial business combination but does have an obligation to vote their shares of our Class B common stock in favour of our initial business combination. For a discussion of certain additional arrangements with our anchor investors, see Summary The Offering Expression of Interest. Rothesay Investment SARL SPF, a member of our sponsor, has agreed, pursuant to a forward purchase agreement entered into with us, to purchase up to 1,000,000 shares of Class A common stock at $10.00 per share (referred to herein as the forward purchase shares) for gross proceeds up to $10,000,000 in a private placement that will occur concurrently with the consummation of our initial business combination. Rothesay s purchase of forward purchase shares pursuant to the forward purchase agreement will be subject to the approval of Rothesay s investment committee or other committee with decision-making authority to purchase the number of forward purchase shares approved by such committee and the other closing conditions set forth in the forward purchase agreement. Rothesay has the right to transfer all or a portion of its rights and obligation to purchase the forward purchase shares to one or more third parties who are affiliates of Rothesay (the forward transferees ), subject to compliance with applicable securities laws. Any such forward transferee will be subject to the same terms and conditions under the forward purchase agreement. The forward purchase shares will be identical to the shares of Class A common stock underlying the units being sold in this offering, except that they will be subject to certain registration rights and transfer restrictions, as described herein. The funds from the sale of the forward purchase shares will be used as part of the consideration to the sellers in the initial business combination and any excess funds will be used for working capital in the post-transaction company. Currently, there is no public market for our units, Class A common stock or warrants. We have applied to list our units on The Nasdaq Global Market, or Nasdaq, under the symbol BYNOU . We expect that our units will be listed on Nasdaq on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on Nasdaq. We expect the Class A common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Keefe, Bruyette & Woods, Inc and Drexel Hamilton, LLC, the representatives of the underwriters, inform us of their decision to allow earlier separate trading, subject to our satisfaction of certain conditions. Once the securities comprising the units begin separate trading, we expect that the Class A common stock and warrants will be listed on Nasdaq under the symbols BYNO and BYNOW, respectively. Table of Contents TABLE OF CONTENTS Page Summary 1
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diff --git a/parsed_sections/prospectus_summary/2022/BZFDW_buzzfeed_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/BZFDW_buzzfeed_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
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+++ b/parsed_sections/prospectus_summary/2022/BZFDW_buzzfeed_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CCEL_cryo-cell_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CCEL_cryo-cell_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..e2320e38007bba6ede45c2714824be7939a8c50d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CCEL_cryo-cell_prospectus_summary.txt
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+PROSPECTUS SUMMARY The following summary highlights information contained in this prospectus or incorporated by reference. While we have included what we believe to be the most important information about the company, the following summary may not contain all the information that may be important to you. You should read this entire prospectus carefully, including the risks of investing discussed under Risk Factors beginning on page 17, the information to which we refer you and the information incorporated into this prospectus by reference, for a complete understanding of our business and the terms of any offering. References in this prospectus to our company, we, our, Cryo-Cell and us refer to Cryo-Cell International, Inc. and to the Notes refer to the % Senior Notes due 202[ ] offered. Cryo-Cell International, Inc. Overview The Company currently stores nearly 225,000 cord blood and cord tissue specimens for the exclusive benefit of newborn babies and possibly other members of their families. Founded in 1989, the Company was the world s first private cord blood bank to separate and store stem cells in 1992. The Company s U.S.-based business operations, including the processing and storage of specimens, are handled from its headquarters facility in Oldsmar, Florida. Utilizing its infrastructure, experience and resources derived from its umbilical cord blood stem cell business, the Company has expanded its research and development activities to develop technologies related to stem cells harvested from sources beyond umbilical cord blood stem cells. In 2011, the Company introduced its new cord tissue service, which stores a section of the umbilical cord tissue. The Company offers the cord tissue service in combination with the umbilical cord blood service. On February 23, 2021, the Company entered into a Patent and Technology License Agreement (the Duke Agreement ) with Duke University ( Duke ). The Duke Agreement grants the Company the rights to proprietary processes and regulatory data related to cord blood and cord tissue developed at Duke. The Company plans to explore, test, and/or administer these treatments to patients with osteoarthritis and with conditions for which there are limited U.S. Federal Drug Administration ( FDA ) approved therapies, including cerebral palsy, autism, and multiple sclerosis. These treatments utilize the unique immunomodulatory and potential regenerative properties derived from cord blood and cord tissue. Pursuant to the Duke Agreement, the Company has been granted exclusive commercial rights to Duke s granted exclusive commercial rights to Duke s intellectual property assets, FDA regulatory data, clinical expertise and manufacturing protocols associated with various applications of cord blood and cord tissue stem cells. Through this Agreement, the Company intends to expand to a triad of core business units to include: (1) its cord blood bank and other storage services; (2) cord blood and cord tissue infusion clinic services initially under the FDA s Expanded Access Program and in conjunction with the undertaking of cord blood and cord tissue clinical trials to obtain biologics license application ( BLA ) approvals for new indications, and (3) biopharmaceutical manufacturing if BLA(s) are approved by the FDA. The Company is projecting to open the Cryo-Cell Institute for Cellular Therapies and begin infusing patients with autologous cord blood units during the first quarter of 2023. Cord Blood Stem Cell Processing and Storage Business Background of Business Nearly fifty years ago researchers discovered that cells could be cryopreserved at extremely low temperatures and all cellular activity would cease until the specimens were thawed. Historically, cryopreservation was required for organ transplants, blood banking and medical research. Today, cryopreservation of umbilical cord blood stem cells gives individuals the opportunity to potentially take advantage of evolving cellular therapies and other medical technologies. Table of Contents Hematopoietic stem cells are the building blocks of our blood and immune systems. They form the white blood cells that fight infection, red blood cells that carry oxygen throughout the body and platelets that promote healing. These cells are found in bone marrow where they continue to generate cells throughout our lives. Stem cells can be stored in a cryogenic environment, and upon thawing, infused into a patient. They can be returned to the individual from whom they were taken (autologous) or donated to someone else (allogeneic). An individual s own bone marrow may be used for a transplant if the cancer has not entered the marrow system (metastasized). Otherwise, a marrow donor needs to be identified to provide the needed bone marrow. The availability of a marrow donor or matched stem cell specimen allows physicians to administer larger doses of chemotherapy or radiation in an effort to eradicate the disease. Stem cell therapies and transplants are used for both cancerous and non-cancerous diseases. Stem cells are found in umbilical cord blood ( cord blood stem cells ) and can be collected and stored after a baby is born. Over 40,000 cord blood stem cell transplants have been performed to date. The Company believes that many parents will want to save and store these cells for potential future use by their family, either for the donor or for another family member. Today, stem cell transplants are known and accepted treatments for at least 78 diseases, we believe, a number of them life-threatening. With continued research in this area of medical technology, other therapeutic uses for cord blood stem cells are being explored. Moreover, researchers believe they may be utilized in the future for treating diseases that currently have no cure. It is the Company s mission to inform expectant parents and their prenatal care providers of the potential medical benefits from preserving stem cells and to provide them the means and processes for collection and storage of these cells. A vast majority of expectant parents are simply unaware that umbilical cord blood contains a rich supply of non-controversial stem cells and that they can be collected, processed and stored for the potential future use of the newborn and possibly related family members. A baby s stem cells are a perfect match for the baby throughout its life and have a 1-in-4 chance of being a perfect match and a 3-in-4 chance of being an acceptable match for a sibling. There is no assurance, however, that a perfect match means the cells could be used to treat certain diseases of the newborn or a relative. Today, it is still common for the cord blood (the blood remaining in the umbilical cord and placenta) to be discarded at the time of birth as medical waste. Despite the potential benefits of umbilical cord blood stem cell preservation, the number of parents of newborns participating in stem cell preservation is still relatively small compared to the number of births (four million per annum) in the United States. Some reasons for this low level of market penetration are the misperception of the high cost of stem cell storage and a general lack of awareness of the benefits of stem cell preservation programs. However, evolving medical technology could significantly increase the utilization of the umbilical cord blood for transplantation and/or other types of treatments. The Company believes it offers the highest quality, highest value service targeted to a broad base of the market. We intend to maximize our growth potential through our superior quality, value-driven competitive leadership position, product differentiation, an embedded client base, increased public awareness and accelerated market penetration. The Company believes that the market for cord blood stem cell preservation is enhanced by global discussion on stem cell research developments and the current focus on reducing prohibitive health care costs. With the increasing costs of bone marrow matches and transplants, a newborn s umbilical cord blood cells can be stored as a precautionary measure. Medical technology is constantly evolving which may provide new uses for cryopreserved cord blood stem cells. Our Cord Blood Stem Cell Storage Services The Company enters into storage agreements with its clients under which the Company charges a fee for the processing and testing and first year of storage of the umbilical cord blood. Thereafter, the client is charged an annual fee to store the specimen, unless the client entered into an 18-year pre-paid storage plan or a lifetime pre-paid storage plan. The Company s corporate headquarters are located in a nearly 18,000 square-foot state-of-the-art current Good Manufacturing Practice and Good Tissue Practice (cGMP/cGTP)-compliant facility. Food and Drug Administration ( FDA ) 21 CFR Part 1271, effective in May 2005, requires human cellular and tissue-based products to be manufactured in compliance with good tissue practices (cGTPs). In addition, the cellular products cryogenic storage area has been designed as a Table of Contents bunker, with enhanced provisions for security, building fortification for environmental element protection and back-up systems for operational redundancies. The Company believes that it was the first private bank to process cord blood in a technologically and operationally advanced cGMP/cGTP-compliant facility. The Company s facility, which also currently houses the Company s client services, marketing and administrative operations, is designed to accommodate a broad range of events such as client tours and open houses, as well as educational workshops for clinicians and expectant parents. Due to the limited storage capacity of its existing facility in Oldsmar, FL, the Company is currently seeking a new building to house its stored specimens. If this facility is purchased, the Company believes it will have space for not only its existing and future internal storage needs, but also will have the capacity to offer third party pharmaceutical companies and medical institutions storage services, to set up a cellular therapy laboratory to manufacture MSCs and possibly the space to consolidate the Cryo-Cell Institute for Cellular Therapies under the same roof in the future. Competitive Advantages The Company believes that it provides several key advantages over its competitors, including: The world s first private cord blood bank, that in combination with its global affiliates, currently stores nearly 225,000 cord blood and cord tissue specimens, Our facility s status as a cGMP- and cGTP-compliant private cord blood bank with AABB accreditation and FACT (the Foundation for the Accreditation for Cellular Therapy) accreditation, a state-of-the-art laboratory processing facility, utilization of a processing method using superior technology that yields the maximum recovery of healthy stem cells and provides superior red blood depletion over all other methods, a five-compartment cord blood freezer bag that allows for multiple uses of the baby s cord blood stem cells, a safe, secure and monitored storage environment, since inception, 100% viability rate of the Company s specimens upon thaw for therapeutic use, a state-of the-art, insulated collection kits, 7-day per week processing capability, and a payment warranty under which the Company agrees to pay $50,000 (effective February 1, 2012 this payment was increased to $75,000 for new clients, effective June 1, 2017 this payment was increased to $100,000 for new clients that choose our premium cord blood processing method, PrepaCyte CB Processing System ( PrepaCyte CB )) to its client if the umbilical cord blood product retrieved is used for a stem cell transplant for the donor or an immediate family member and fails to engraft, subject to various restrictions. Cord Tissue In August 2011, the Company introduced its advanced new cord tissue service, which stores a section of the umbilical cord tissue. Approximately six inches of the cord tissue is procured and transported to the Company s laboratory for processing, testing and cryopreservation for future potential use. Umbilical cord tissue is a rich source of MSCs, which have many unique functions including the ability to inhibit inflammation following tissue damage, to secrete growth factors that aid in tissue repair, and to differentiate into many cell types including neural cells, bone cells, fat cells and cartilage. MSCs are increasingly being researched in regenerative medicine for a wide range of conditions. Table of Contents Public Banking In June 2018, the Company acquired substantially all of the assets of Cord:Use Cord Blood Bank, Inc., a Florida corporation ( Cord:Use ), in accordance with the definitive Asset Purchase Agreement between Cryo-Cell and Cord:Use(the Purchase Agreement ), including without limitation Cord:Use s cord blood operations and its inventory of public cord blood units existing as of the closing date (the Public Cord Blood Inventory ), which included both public (PHS 351) and private (PHS 361) banks. The Company closed the Cord:Use location and maintains its operations in Oldsmar, Florida. The new PHS 351 product is distributed under an IND (10-CBA) maintained by the National Marrow Donor Program ( NMDP ). The Company has continued the contract with Duke initiated by Cord:Use to manufacture, test, cryopreserve, store and distribute the public cord blood units. As part of the Cord:Use Purchase Agreement, the Company has an agreement with Duke, expiring on January 31, 2025, for Duke to receive, process, and store cord blood units for the Public Cord Blood Bank ( Duke Services ). As of February 28, 2022, the Company had approximately 6,000 cord blood units in inventory. Costs charged by Duke for their Duke Services are based on a monthly fixed fee for processing and storing 12 blood units per month. The public units are listed on the NMDP Single Point of Access Registry and are available to transplant centers worldwide. The Company is reimbursed via cost recovery for public cord blood units distributed for transplant through the NMDP. Pursuant to the Purchase Agreement, Cord:Use is entitled to an earn out from the Company s sale of the Public Cord Blood Inventory from and after closing. Each calendar year after the closing, the Company is required to pay to Cord:Use 75% of all gross revenues, net of any returns, received from the sale of public cord blood inventory in excess of $500,000 up to an aggregate amount of $200,000,000. Such payments are to be made quarterly, within 30 days of the end of the last month of each calendar quarter, until the public cord blood inventory is exhausted. In addition, each calendar year after closing, until the public cord blood inventory is exhausted, for every $500,000 of retained gross revenues, net of any returns, received and retained by the Company in excess of the initial $500,000 retained by the Company during such year, the Company is also required to deliver its common stock to Cord:Use, up to an aggregate total value of $5,000,000. As of February 28, 2022, the Company had delivered 465,426 shares at $7.52 per share of its common stock to Cord:Use. The Public Cord Blood Inventory creates a large, ethnically diverse, high-quality inventory of available cord blood stem cell units for those in need of life saving therapy. The Company collects cord blood units at hospitals in Florida, Arizona, California, Michigan and Washington. The Company s public inventory is stored at Duke in North Carolina, and the cord blood units are sold through the NMDP located in Minnesota, who ultimately distributes the cord blood units to transplant centers located in the United States, and around the world. ExtraVault Due to the limited storage capacity of its existing facility in Oldsmar, FL, the Company has been evaluating new sites to house its stored specimens. On March 14, 2022, the Company entered into a $11.2 million purchase contract with Scannell Properties #502, LLC ( Scannell ) for a 56,000 square foot facility under construction located near the Research Triangle Park in the Regional Commerce Center in Durham, North Carolina (the New Facility ). Scannell is constructing certain improvements upon the land, including but not limited to an approximately 56,000 square foot building to be utilized by Cryo-Cell. Construction is expected to be completed by the time the Company acquires the New Facility in approximately 90 days. The consummation of the purchase is subject to the Company s completion of due diligence and various closing conditions to be met by the parties. Although the Company believes that the acquisition is probable, there can be no assurance that the acquisition of this property will be consummated. If the New Facility is purchased, the Company believes it will have space for not only its existing and future internal storage needs, but also will have the capacity to offer third party pharmaceutical companies and medical institutions cold storage services ( ExtraVault see www.extravault.com), to set up a cellular therapy laboratory to manufacture mesenchymal stromal cells from cord tissue ( MSCs) and possibly the space to consolidate the Cryo-Cell Institute for Cellular Therapies under the same roof in the future. The Company anticipates this New Facility will expand the Company s cryopreservation and cold storage business by introducing a new service, ExtraVault (www.extravault.com). With over 30 years of experience in handling biological specimens for both research and clinical use, Cryo-Cell intends to leverage this expertise and offer these biorepository services to biopharmaceutical companies and healthcare institutions. The new facility is being constructed to offer state-of-the-art biologic, reagent and vaccine storage at cost effective prices. A robust Table of Contents inventory management system is planned to be implemented that Cryo-Cell believes will allow customers to view their own inventory through a customer portal and place distribution orders online. As a result, it is anticipated ExtraVault will provide expertise, experience, customer electronic access and cost sensitive solutions to the Company s partners in the biopharma and healthcare industries. Marketing The Company markets its cord blood stem cell preservation services directly to expectant parents and by distributing information through obstetricians, pediatricians, childbirth educators, certified nurse-midwives and other related healthcare professionals. The Company believes that its revenues have been facilitated by a variety of referral sources, resulting from high levels of customer satisfaction. New expectant parent referrals during fiscal 2021 were provided by physicians, midwives and childbirth educators, and by client-to-client referrals and repeat clients storing the stem cells of their additional children. The Company has a national team of field cord blood educators who increase awareness of the benefits of storing cord blood and cord tissue to the Company s clinical referral sources, including physicians, midwives and hospitals and to expectant parents. Other promotional activities include internet advertisements and telemarketing activities. In addition, the Company exhibits at conferences, trade shows and other meetings attended by pregnant women and/or medical professionals. Significant portions of client referrals to the Company are from medical caregiver professionals. The Company s client support team advisors are available by telephone to enroll clients and educate both expectant parents and the medical community on the life-saving potential of cord blood stem cell preservation. The Company continues to use its website, www.cryo-cell.com, to market its services and to provide resource information to expectant parents. The site, which is frequently updated and improved, is divided into areas of interest, including sections for expectant parents, medical caregivers and investors. Expectant parents may request and receive information about the umbilical cord blood and cord tissue service and enroll online. The Company intends to continue offering cord blood and cord tissue banking services to expectant parents and relying on both online advertising and its national team of field cord blood educators to enroll new clients. A significant portion of its new enrollments are generated from returning customers and referrals. Many of the Company s clients choose to enter into either multiyear storage contracts, which results in deferred revenues that are recognized over the life the storage contracts. Our public units are listed on the NMDP registry, which is connected to all other major international registries. NMDP has a contract with the Health Resources & Services Administration (HRSA), part of the Human Health Services Department of the US government, to be the single point of access for bone marrow, peripheral blood and cord blood for transplant centers needing stem cells for transplant. Additionally, the Company has definitive license agreements to market the Company s umbilical cord blood stem cell programs in Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua and Panama. Recent Developments On January 19, 2022, we received a written notice (the Notice ) from Nasdaq that our audit committee is comprised of two independent board members, and no longer complies with Nasdaq s audit committee requirement that the audit committee be comprised of at least three independent board members as set forth in Listing Rule 5605. In accordance with Nasdaq s Listing Rule 5605(c)(4) ( the Rule ), Nasdaq provides a cure period in order to regain compliance. The cure period is until the earlier of the Company s next annual shareholders meeting or September 20, 2022. The Company must submit documentation, including the biography of any new director, evidencing compliance of the Rule no later than the compliance date described above. The Company is working diligently to comply with Nasdaq s audit committee requirements as set for in the Rule within the cure period provided by Nasdaq, and expects to evidence compliance to Nasdaq no later than the compliance date, but there can be no assurance that we will be able to maintain compliance and remain in compliance in the future. If we fail to comply with Nasdaq s continued listing standards, we may be delisted from Nasdaq, and if we are delisted from Nasdaq, our Notes may be delisted from the NYSE American, which requires that our equity be listed on an exchange. Delisting of the common stock could depress the price of our stock and Notes, substantially limit liquidity of our common stock and Notes and materially adversely affect our ability to raise capital on terms acceptable to us, or at all. In such event, it could become more difficult to dispose of, or obtain accurate price quotations for, our common stock and Notes, and there would likely also be a reduction in our coverage by securities analysts and the news media, which could cause the price of our common stock and Notes to decline further. Corporate Information We are a Delaware corporation that was incorporated in 1989. Our executive offices are located at 700 Brooker Creek Blvd, Suite 1800, Oldsmar, Florida 34677 and our telephone number at such office is (813) 749-2100. Our website address is https://www.cryo-cell.com. Information contained on our website is not deemed part of this prospectus. Table of Contents
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+Summary of the Prospectus 1
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+PROSPECTUS SUMMARY
+ 
+ This summary highlights the more detailed information contained elsewhere in this prospectus or incorporated by reference herein and does not contain all of the information that you should consider before deciding to invest in shares of common stock. You should read the entire prospectus carefully, including the documents incorporated by reference herein.
+ 
+ Our Company
+ 
+ We are a Nevada corporation based in Houston, Texas. We are currently primarily engaged in the acquisition, development and sale of crude oil, natural gas and natural gas liquids from various known productive geological formations in Kansas, Louisiana and Texas, and hold interests in non-producing wells in Mississippi. We were incorporated in Nevada in December 2003 under the name Panorama Investments Corp. and changed our name to Lucas Energy, Inc., effective June 9, 2006, and effective January 4, 2017, we changed our name to Camber Energy, Inc. With the acquisition of a majority interest in Viking Energy Group, Inc. on December 23, 2020 and January 8, 2021, our business plan is to acquire a majority interest in assets or entities in the energy sector, including engaging in the acquisition, exploration, development and production of oil and natural gas properties, both individually and through collaborative partnerships with other companies in this field of endeavor.
+ 
+ Corporate Information
+ 
+ Our principal executive office is located at 15915 Katy Freeway, Suite 450, Houston, Texas 77094, and our telephone number is (281) 404-4387. Our website is www.camber.energy.com. Information on our website is not a part of this prospectus. The information contained on, or that can be accessed through, our website is not a part of this prospectus and is not incorporated by reference herein.
+ 
+ Risks Associated with Our Business
+ 
+ An investment in our common stock involves a significant degree of risk. You should carefully consider the risk factors and all of the other information included in this prospectus and the documents we have incorporated by reference into this prospectus, including those in Item 1A. Risk Factors in our most recent Annual Report on Form 10-K filed with the SEC, as supplemented by our Quarterly Reports on Form 10-Q, before making an investment decision. Any of these risks and uncertainties could have a material adverse effect on our business, financial condition, cash flows and results of operations could be materially adversely affected. If that occurs, the trading price of our common stock could decline materially, and you could lose all or part of your investment. 
+ 
+ The risks included in this prospectus and the documents we have incorporated by reference into this prospectus are not the only risks we face. We may experience additional risks and uncertainties not currently known to us, or as a result of developments occurring in the future. Conditions that we currently deem to be immaterial may also materially and adversely affect our business, financial condition, cash flows and results of operations.
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+PROSPECTUS SUMMARY The following summary highlights information contained in greater details elsewhere in this prospectus. This summary is not complete and does not contain all of the information you should consider in making your investment decision. You should read the entire prospectus carefully before making an investment in our common stock or warrants. You should carefully consider, among other things, our financial statements and related notes and the sections titled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations included elsewhere in this prospectus. Company Overview Our key mission is to become the leading Bitcoin mining company in the United States. We are an emerging technology company that plans to operate in the Bitcoin mining ecosystem in the United States. We were established by the Bitfury Group, a global full-service blockchain and technology specialist and one of the leading private infrastructure providers in the blockchain ecosystem. On August 27, 2021, we consummated the Business Combination with Good Works. As a stand-alone, U.S.-based cryptocurrency mining business, specializing in Bitcoin, we have begun our initial buildout phase with a set-up of cryptocurrency mining sites in four cities in the United States (three in Texas and one in Ohio). We currently anticipate beginning deployment of capacity, with power and infrastructure readiness across three of our planned cryptocurrency mining sites, in the first quarter of 2022. In connection with our planned set-up, we entered into the Standard Power Hosting Agreement, the WindHQ Joint Venture Agreement and the Luminant Power Agreement, all of which, together, are expected to cover sites for our data centers referenced above, see Business Material Agreements . Pursuant to these agreements, we expect to have access, for at least five years, to an average cost of electricity of approximately 2.7 c/kWh. We expect that this will help competitively position us to achieve our goal of becoming the leading Bitcoin mining operator in the United States. We aim to deploy the computing power that we will create to mine Bitcoin and validate transactions on the Bitcoin network. We believe that Cipher will become an important player in the Bitcoin network due to our planned large-scale operations, best-in-class technology, market-leading power and hosting arrangements and a seasoned, dedicated senior management team. Corporate Information We were incorporated on June 24, 2020 as a special purpose acquisition company and a Delaware corporation under the name Good Works Acquisition Corp. On October 22, 2020, GWAC completed its initial public offering. On August 27, 2021, GWAC consummated the Business Combination with Cipher pursuant to the Merger Agreement. In connection with the Business Combination, GWAC changed its name to Cipher Mining Inc. Our address is 222 Purchase Street, Suite #290, Rye, New York, 10580. Our telephone number is (914) 370-8006. Our website address is https://investors.ciphermining.com . Information contained on our website or connected thereto does not constitute part of, and is not incorporated by reference into, this prospectus or the registration statement of which it forms a part. Recent Business Developments On August 20, 2021 and on August 30, 2021, we and Bitmain Technologies Limited ( Bitmain ) entered into agreements for us to purchase 27,000 Antminer S19j Pro (100 TH/s) miners, which are expected to be delivered in nine batches on a monthly basis between January 2022 and September 2022. Table of Contents If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. Calculation of Registration Fee Title of each class of securities to be registered Amount to be registered(1) Proposed maximum offering price per security Proposed maximum aggregate offering price Amount of registration fee Common stock, par value $0.001 per share(2) 26,711,705 $3.24 (6) $ 86,545,924 $8,022.81 (8) Common stock, par value $0.001 per share(3) 8,614,000 $11.50(4) $99,061,000 $9,182.95 Common stock, par value $0.001 per share(5) 114,000 $3.24 (6) $369,360 $34.24 Private Placement Warrants to purchase common stock 114,000 $0.76 (7) $86,640 $8.03 Total $17,248.03 (8) (1) Pursuant to Rule 416(a) of the Securities Act of 1933, as amended (the Securities Act ), there are also being registered an indeterminable number of additional securities as may be issued to prevent dilution resulting from stock splits, stock dividends or similar transactions. (2) 42,035,500 shares of common stock of the registrant were initially registered for resale on the registrant s registration statement on Form S-1 (File No. 333-259786) initially filed with the Securities and Exchange Commission on September 24, 2021 (the 2021 S-1 Registration Statement ), with 15,323,795 of those shares sold under the 2021 S-1 Registration Statement, and the remaining 26,711,705 shares of common stock being included hereunder. (3) Consists of (i) 8,500,000 shares of common stock that are issuable upon the exercise of 8,500,000 Public Warrants (as defined herein) and (ii) 114,000 shares of common stock that are issuable upon the exercise of 114,000 Private Placement Warrants (as defined herein). (4) Calculated pursuant to Rule 457(g) under the Securities Act, based on the exercise price of the Warrants. (5) The number of shares of common stock being registered for resale represents 114,000 shares of common stock issuable upon the exercise of the Private Placement Warrants. (6) Estimated solely for the purpose of calculating the registration fee, based on the average of the high and low prices of the common stock on the Nasdaq Global Select Market on January 19 , 2022 ($3.24 per share). This calculation is in accordance with Rule 457(c) of the Securities Act. (7) Estimated solely for the purpose of calculating the registration fee, based on the average of the high and low prices of the Public Warrants on the Nasdaq Global Select Market on January 19 , 2022 (such date being within five business days of the date that this registration statement was first filed with the SEC). This calculation is in accordance with Rule 457(c) of the Securities Act. (8) Pursuant to Rule 457(p) of the Securities Act, the registrant is offsetting the registration fee due under this registration statement by $8,022.81 , which represents the portion of the registration fee previously paid with respect to unsold securities included in the 2021 S-1 Registration Statement (as defined above) to register for resale 42,035,500 shares of common stock of the registrant. Table of Contents SELECTED DEFINITIONS Unless otherwise stated in this prospectus or the context otherwise requires, references to: Amended and Restated Bitfury Subscription Agreement are to that certain subscription agreement, dated as of March 4, 2021, as amended and restated in its entirety on July 8, 2021 and as subsequently amended and restated in its entirety on August 27, 2021, by and among Bitfury Top HoldCo and GWAC; Anchor Investors are to certain funds and accounts managed by Magnetar Financial LLC, Mint Tower Capital Management B.V., Peridian Fund, L.P., and Polar Multi-Strategy Master Fund; Bitfury Group are to Bitfury Top HoldCo and its subsidiaries; Bitfury Holding are to Bitfury Holding B.V., a subsidiary of Bitfury Top HoldCo; Bitfury Private Placement are to the private placement pursuant to which GWAC entered into the Amended and Restated Bitfury Subscription Agreement with Bitfury Top HoldCo pursuant to which Bitfury Top HoldCo agreed to subscribe for and purchase, and Good Works agreed to issue and sell to Bitfury Top HoldCo (or an affiliate of Bitfury Top HoldCo), an aggregate of 6,000,000 shares of our common stock at a purchase price of $10.00 per share for an aggregate of cash and/or forgiveness of outstanding indebtedness owed by Cipher to Bitfury Top HoldCo (or an affiliate of Bitfury Top HoldCo) of $60,000,000; Bitfury Top HoldCo are to Bitfury Top HoldCo B.V., the holder of 100% of the shares of Cipher Common Stock prior to the Business Combination; Board are to our board of directors; Business Combination are to the Merger and other transactions contemplated by the Merger Agreement, collectively, including the PIPE Financing and the Bitfury Private Placement; Bylaws are to the Amended and Restated Bylaws of Cipher Mining Inc., adopted on August 27, 2021; Certificate of Incorporation are to the Second Amended and Restated Certificate of Incorporation of Cipher Mining Inc., as filed with the Delaware Secretary of State on August 27, 2021; Cipher are to the Cipher Mining Technologies Inc, a Delaware corporation, prior to the consummation of the Business Combination and to Cipher Mining Inc. and its consolidated subsidiaries following the Business Combination; Cipher Common Stock are to the shares of common stock, par value $0.001 per share, of Cipher; Closing are to the closing of the Business Combination; Closing Date are to August 27, 2021; Code are to the Internal Revenue Code of 1986, as amended; Company Support Agreement are to that certain support agreement, dated as of March 4, 2021, by and among GWAC, Cipher and Bitfury Top HoldCo; COVID-19 are to the novel coronavirus, SARS-CoV-2 or COVID-19 or any mutation of the same, including any resulting epidemics, pandemics, disease outbreaks or public health emergencies; DGCL are to the Delaware General Corporation Law, as amended; Exchange Act are to the Securities Exchange Act of 1934, as amended; Exchange Ratio are to the ratio of 400,000 shares of our common stock for each 1 share of Cipher Common Stock; Effective Time are to the effective time of the Merger; Governing Documents are to the Certificate of Incorporation and the Bylaws; Table of Contents On September 2, 2021, we entered into a framework agreement with SuperAcme Technology (Hong Kong) Limited to purchase 60,000 MicroBT M30S, M30S+ and M30S++ miners, which are expected to be delivered in six batches on a monthly basis between July 2022 and year-end 2022. On October 11, 2021, we entered into an agreement with Bitfury Top HoldCo B.V. ( Bitfury Top HoldCo B.V. ), made under, and as a part of, the master services and supply agreement with Bitfury Top HoldCo (the Master Services and Supply Agreement ) to purchase a total of between 28,000 to 56,000 mining rigs, which are expected to be delivered in seven batches on a monthly basis between June 2022 and December 2022. On December 29, 2021, we also entered into an agreement with Bitfury USA Inc., a subsidiary of Bitfury Top HoldCo, made under, and as a part of, the Master Services and Supply Agreement, to purchase 180 units of BlockBox air-cooled containers, the modular data centers that house mining machines, which are expected to be delivered in 20 batches between May 2022 and October 2022. Summary Risk Factors Our business is subject to numerous risks and uncertainties, including those highlighted in the section entitled Risk Factors immediately following this prospectus summary, that represent challenges that we face in connection with the successful implementation of our strategy and the growth of our business. In particular, the following considerations, among others, may offset our competitive strengths or have a negative effect on our business strategy, which could cause a decline in the price of shares of our common stock or warrants and result in a loss of all or a portion of your investment: We are in an early stage of development. If we are not able to develop our business as anticipated, we may not be able to generate revenues or achieve profitability and you may lose your investment. Our lack of operating history makes evaluating our business and future prospects difficult and increases the risk of an investment in our securities. Our operating results may fluctuate due to the highly volatile nature of cryptocurrencies in general and, specifically, Bitcoin. Bitcoin mining activities are energy-intensive, which may restrict the geographic locations of miners and have a negative environmental impact. Government regulators may potentially restrict the ability of electricity suppliers to provide electricity to mining operations, such as ours, or even fully or partially ban mining operations. We may be affected by price fluctuations in the wholesale and retail power markets. We will be vulnerable to severe weather conditions and natural disasters, including severe heat, earthquakes, fires, floods, hurricanes, as well as power outages and other industrial incidents, which could severely disrupt the normal operation of our business and adversely affect our results of operations. We may depend on third parties to provide us with certain critical equipment and may rely on components and raw materials that may be subject to price fluctuations or shortages, including ASIC chips that have been subject to an ongoing significant shortage. We are exposed to risks related to disruptions or other failures in the supply chain for cryptocurrency hardware and difficulties in obtaining new hardware. The properties in our mining network may experience damages, including damages that are not covered by insurance. Table of Contents CIPHER MINING INC. STATEMENT OF CHANGES IN STOCKHOLDERS EQUITY FOR THE PERIOD FROM JUNE 24, 2020 (INCEPTION) THROUGH DECEMBER 31, 2020 (Restated-See Note 2) Common Stock Additional Paid-in Capital Accumulated Deficit Total Stockholders Equity Shares Amount Balance as of June 24, 2020 (inception) $ $ $ $ Issuance of common stock to founders 4,312,500 4,313 20,687 25,000 Sale of 1,355,000 to anchor investors 1,355,000 1,355 (1,355 ) Forfeiture of 1,355,000 by initial stockholders (1,355,000 ) (1,355 ) 1,355 Sale of 562,500 to GW Sponsor 2, LLC 562,500 563 162,562 163,125 Forfeiture of 562,500 by initial stockholders (562,500 ) (563 ) 563 Sale of 228,000 Private Units on October 22, 2020 (Restated) 228,000 228 2,279,772 2,280,000 Fair value of derivative warrant liabilities issued in private placement (142,353 ) (142,353 ) Forfeiture of 62,500 by initial stockholders (62,500 ) (63 ) 63 Accretion to common stock subject to possible redemption amount (Restated) (870,122 ) (870,122 ) Net loss (107,031 ) (107,031 ) Balance as of December 31, 2020 4,478,000 $ 4,478 $ 1,451,172 $ (107,031 ) $ 1,348,619 The accompanying notes are an integral part of these financial statements. F-5 Table of Contents The information in this preliminary prospectus is not complete and may be changed. The securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED JANUARY 21 , 2022 PROSPECTUS Cipher Mining Inc. 26,825,705 Shares of Common Stock 8,614,000 Shares of Common Stock Underlying Warrants 114,000 Private Placement Warrants to Purchase Shares of Common Stock This prospectus relates to (A) the offer and sale from time to time by the selling securityholders named in this prospectus (the Selling Securityholders ) of up to 26,825,705 shares of common stock, par value $0.001 per share ( common stock ), consisting of (i) up to 17,075,205 shares of common stock (the PIPE Shares ) issued in a private placement in connection with the consummation of the Business Combination pursuant to subscription agreements entered into on March 4, 2021 (the PIPE Financing ); (ii) up to 1,525,000 shares of common stock (the Initial Stockholder Shares ) issued in connection with the consummation of the Business Combination, in exchange for shares of GWAC common stock, par value $0.001 per share (the GWAC common stock ) originally issued in a private placement to certain Initial Stockholders (as defined below); (iii) up to 757,500 shares of common stock issued in connection with the Business Combination, in exchange for GWAC common stock issued in a private placement to I-B Good Works, LLC (the Sponsor ); (iv) up to 562,500 shares of common stock issued in connection with the consummation of the Business Combination, in exchange for GWAC common stock issued in a private placement to GW Sponsor 2, LLC; (v) up to 563,500 shares of common stock issued in connection with the consummation of the Business Combination, in exchange for GWAC common stock issued in a private placement to the Anchor Investors (as defined below); (vi) 6,000,000 shares of common stock issued to Bitfury Holding B.V. as an affiliate of Bitfury Top HoldCo pursuant to the Bitfury Private Placement (as defined below); (vii) up to 228,000 shares of common stock issued in connection with the consummation of the Business Combination, in exchange for GWAC common stock originally issued upon separation of the GWAC Private Placement Units issued in a private placement simultaneously with the closing of GWAC s public offering (the Private Placement Shares ) and (viii) up to 114,000 shares of common stock issuable upon the exercise of Private Placement Warrants (as defined below) and (B) the offer and sale from time to time by the Selling Securityholders of an aggregate of up to 114,000 private placement warrants (the Private Placement Warrants ) originally issued in a private placement in connection with the GWAC IPO (as defined below) at an exercise price of $11.50 per share of common stock. In addition, this prospectus relates to the offer and sale of (i) up to 8,500,000 shares of common stock that are issuable by us upon the exercise of 8,500,000 Public Warrants that were previously registered and (ii) up to 114,000 shares of common stock that are issuable by us upon the exercise of 114,000 Private Placement Warrants. On August 27, 2021, we consummated the transactions contemplated by that certain Agreement and Plan of Merger, dated as of March 4, 2021 (the Merger Agreement ), by and among Good Works Acquisition Corp., a Delaware corporation ( GWAC or Good Works and, upon consummation of the Business Combination described below, New Cipher ), Currency Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of GWAC ( Merger Sub ), and Cipher Mining Technologies Inc., a Delaware corporation ( Cipher ). On August 27, 2021, as contemplated by the Merger Agreement, New Cipher consummated the merger contemplated by the Merger Agreement, whereby Merger Sub merged with and into Cipher, the separate corporate existence of Merger Sub Table of Contents GWAC are to Good Works Acquisition Corp., a Delaware corporation; GWAC Common Stock are to, prior to consummation of the Transactions, GWAC s common stock, par value $0.001 per share and, following consummation of the Transactions, to the common stock, par value $0.001 per share, of New Cipher; GWAC Founder Shares are to the 4,478,000 shares of GWAC Common Stock held by the Sponsor, GWAC Sponsor 2, LLC, the Anchor Investors, GWAC s officers and directors, and certain other GWAC stockholders (collectively, the Founders ); GWAC s IPO are to the initial public offering by GWAC which closed on October 19, 2020; GWAC Private Placement Shares are to the 228,000 private placement shares of GWAC underlying 228,000 of GWAC Private Placement Units; GWAC Private Placement Units are to the 228,000 units that were issued in a private placement at a price of $10.00 per unit to certain funds and accounts managed by the Anchor Investors, simultaneously with the closing of the GWAC s IPO; each unit consists of one GWAC Private Placement Share and one-half of one Warrant; GWAC Support Agreement are to that certain support agreement, entered into on March 4, 2021, as amended and restated in its entirety on May 12, 2021, by and among GWAC, the Sponsor, GW Sponsor 2, LLC, Magnetar Financial LLC, Mint Tower Capital Management B.V., Peridian Fund, L.P., Polar Multi-Strategy Master Fund, and Cipher; Incentive Award Plan are to the New Cipher s incentive award plan; Initial Stockholder Shares are to 775,000 shares of our common stock owned by the Initial Stockholders and 800,000 shares of our common stock, which certain Initial Stockholders donated to non-profit organizations listed as the Selling Securityholders in this prospectus; Initial Stockholders are to GWAC s former officers and directors, namely Cary Grossman, Fred Zeidman, Douglas Wurth, David Pauker, John J. Lendrum III, Paul Fratamico and Tahira Rehmatullah; Master Services and Supply Agreement or the MSSA are to the master services and supply agreement to entered into at Closing by Cipher and Bitfury Top HoldCo; Merger are to the merger of Merger Sub with and into Cipher pursuant to the Merger Agreement, with Cipher as the surviving company in the Merger and, after giving effect to such Merger, Cipher becoming a wholly-owned subsidiary of GWAC; Merger Agreement are to that certain Agreement and Plan of Merger, dated as of March 4, 2021, by and among GWAC, Cipher and Merger Sub; Merger Consideration are to each share of Cipher Common Stock issued and outstanding immediately prior to the Effective Time, other than any Cipher Cancelled Shares, shall be converted into the right to receive four hundred thousand (400,000) shares of duly authorized, validly issued, fully paid and nonassessable common stock (deemed to have a value of ten dollars ($10.00) per share); Merger Sub are to Currency Merger Sub, Inc., a Delaware corporation and a direct wholly owned subsidiary of GWAC; Named Sponsors are to I-B Good Works, LLC, Magnetar Financial LLC, Mint Tower Capital Management B.V., Periscope Capital, Inc. and Polar Asset Management Partners Inc.; New Cipher are to GWAC after giving effect to the Business Combination and its name change from GWAC Acquisition Corp. to Cipher Mining Inc.; Table of Contents Emerging Growth Company We are an emerging growth company, as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in their periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. Further, section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. We have elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our financial statements with certain other public companies difficult or impossible because of the potential differences in accounting standards used. We will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) December 31, 2025, the last day of the fiscal year following the fifth anniversary of the date of the first sale of the initial public offering by GWAC, which closed on October 19, 2020 ( GWAC s IPO ), (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common equity that is held by non-affiliates exceeds $700 million as of the end of the prior fiscal year s second fiscal quarter; and (2) the date on which we have issued more than $1.00 billion in non-convertible debt during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act. Table of Contents ceasing and Cipher being the surviving corporation and a wholly owned subsidiary of New Cipher (the Merger and, together with the other transactions contemplated by the Merger Agreement, the Business Combination ). The Selling Securityholders may offer, sell or distribute all or a portion of the securities hereby registered publicly or through private transactions at prevailing market prices or at negotiated prices. We will not receive any of the proceeds from such sales of the shares of our common stock or warrants, except with respect to amounts received by us upon the exercise of the warrants for cash. We will bear all costs, expenses and fees in connection with the registration of these securities, including with regard to compliance with state securities or blue sky laws. The Selling Securityholders will bear all commissions and discounts, if any, attributable to their sale of shares of our common stock or warrants. See Plan of Distribution beginning on page 120 of this prospectus. Our common stock and public warrants are listed on the Nasdaq Global Select Market (the Nasdaq ) under the symbols CIFR and CIFRW, respectively. On January 20 , 2022, the last reported sales price of our common stock was $3.25 per share and the last reported sales price of our public warrants was $0.75 per warrant. We are an emerging growth company as defined in Section 2(a) of the Securities Act of 1933, as amended, and, as such, have elected to comply with certain reduced disclosure and regulatory requirements. Investing in our securities involves risks. See the section entitled Risk Factors beginning on page 6 of this prospectus to read about factors you should consider before buying our securities. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022 Table of Contents New Cipher Common Stock are to the share of common stock, par value $0.001 per share, of New Cipher; PIPE Financing are to the private placement pursuant to which GWAC entered into the PIPE Subscription Agreements (containing commitments to funding that are subject only to conditions that generally align with the conditions set forth in the Merger Agreement) with certain investors whereby such investors purchased an aggregate of 32,235,000 shares of our common stock at a purchase price of $10.00 per share for an aggregate commitment of $322,350,000; PIPE Investment Amount are to a consideration in an aggregate value equal to three hundred and eighty-two million, three hundred and fifty thousand dollars ($382,350,000), comprising payments of cash and/or forgiveness of outstanding indebtedness, contemplated by the PIPE Financing and the Bitfury Private Placement; PIPE Investors are to the investors who participated in the PIPE Financing and entered into the PIPE Subscription Agreements; PIPE Subscription Agreements are to the subscription agreements entered into by and between GWAC and each of the PIPE Investors in connection with the PIPE Financing; Private Placement Shareholders are to the holders of the GWAC Private Placement Shares; Private Placement Warrants means the currently outstanding 114,000 private placement warrants to purchase ordinary shares of New Cipher that were issued to the Anchor Investors as part of GWAC s IPO, which are substantially identical to the Public Warrants, subject to certain limited exceptions; public shares are to shares of GWAC Common Stock sold as part of the units in the GWAC s IPO (whether they were purchased in the GWAC s IPO or thereafter in the open market); public stockholders are to the holders of public shares, including the Sponsor and GWAC s officers and directors to the extent the Sponsor and GWAC s officers or directors purchase public shares, provided that each of their status as a public stockholder shall only exist with respect to such public shares; Public Warrants are to the currently outstanding 8,500,000 redeemable warrants to purchase ordinary shares of New Cipher that were issued in GWAC s IPO; Registration Rights Agreement are to that certain registration rights agreement, dated as of August 26, 2021, by and among GWAC, Cipher, the Sponsor, Bitfury Top HoldCo and the other parties thereto; SEC are to the United States Securities and Exchange Commission; Sponsor are to I-B Good Works LLC, a Delaware limited liability company; Stockholder Restrictive Covenant Agreement are to that certain restrictive covenant agreement, dated as of March 4, 2021, by and among Bitfury Top HoldCo and GWAC; Transaction Agreements are to the Merger Agreement, the GWAC Support Agreement, the Company Support Agreement, the Registration Rights Agreement, the PIPE Subscription Agreements, each Letter of Transmittal, the Proposed Certificate of Incorporation, the Proposed Bylaws, and all the other agreements, documents, instruments and certificates entered into in connection herewith and/or therewith and any and all exhibits and schedules thereto; Transactions are to, collectively, the Business Combination and the other transactions contemplated by the Merger Agreement; transfer agent are to Continental Stock Transfer & Trust Company, GWAC s transfer agent; Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0000225211_touchpoint_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0000225211_touchpoint_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights material information concerning our business and this offering. This summary does not contain all of the information that you should consider before making your investment decision. You should carefully read the entire prospectus and the information incorporated by reference into this prospectus, including the information presented under the section entitled "Risk Factors" and the financial data and related notes, before making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results may differ significantly from future results contemplated in the forward-looking statements as a result of factors such as those set forth in "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Statements." Unless otherwise indicated, except for our financial statements and the notes thereto, all references to our common stock, share data, per share data and related information gives effect to a 1-for 25 reverse stock split effected on September 26, 2019. In this prospectus, unless the context indicates otherwise, the "Touchpoint Group," "TG," "Company," "we," "our," "ours" or "us" refer to Touchpoint Group Holdings, Inc., a Delaware corporation, and its subsidiaries. Overview We are a media and technology software development and holding company. We currently supply a robust fan engagement platform designed to enhance fan experience and drive commercial aspects of the sports and entertainment business. We bring users closer to the action by enabling them to engage with clubs, favorite players, peers and relevant brands through features available through the Touchpoint platform and related apps (the "TP Platform"), that include live streaming, access to limited edition merchandise, gamification, user rewards, third party branded offers, credit cards and associated benefits. We currently have operations in the United States of America and the United Kingdom. Beginning in 2018 we completed a series of acquisitions of companies in media related industries. Except for Banana Whale Studios PTE Ltd, which was sold by the Company for a profit, none of the companies acquired achieved the growth we envisioned and all have been liquidated. In September 2021 we determined to seek to revitalize the "World Championship Air Race Series" which had been developed by Red Bull for marketing purposes and promoted as the "Red Bull Air Race." Red Bull hosted 94 championship races around the globe until it elected to terminate the Series in 2019. Over the course of the Series, it attracted viewers in 187 countries and was broadcast to an audience of over 230 million viewers. It is estimated to have achieved 2.3 billion media impressions worldwide in its 2019 season and AC Nielsen forecast that each race in the 2022 season would attract a TV audience of 49.5 million. It is the largest live spectator sports event in the world attracting over 1 million spectators to a single air race on multiple occasions in cities such as Rio De Janeiro and Barcelona. As part of our effort to restore the WCAR, we engaged key operational staff which planned and staged the races for Red Bull and acquired certain rights to continue the Series. We have contacted previous host cities and sponsors and we anticipate that the season opener will take place in the second quarter of 2022. There are currently six races scheduled for the balance of the 2022 season at iconic locations in Egypt, Greece, Portugal, United Kingdom, Indonesia and Australia. Twelve Elite Race Teams have already signed-up for the 2022, 2023 and 2024 race seasons and Red Bull has indicated it will maintain its interest in the Air Race with continued sponsorship of former World Champion Martin Sonka in the Elite series. We believe we can utilize our expertise in fan engagement to enhance the experience of fans of the WCAR and enhancement through the use of leading edge VR and AR technology will transform the experience for viewers on television and our streaming platform. The Touchpoint Platform: The TP Platform is designed to enhance the fan experience and drive commercial aspects of the sports and entertainment business. The features of the platform include live streaming, video content library, access to limited edition merchandise including collectables such as limited-edition videos and other digitized media files (non-fungible tokens (NFT)), full end to end shop module, gamification, user rewards, third party branded offers, credit cards and associated benefits. The platform provides in-depth analytics that enable marketing teams to ensure that they deliver aligned, strategic messages and campaigns to the right audience at the right time. We continue to engage in software development, design, integration, support and maintenance services to the TP Platform to build new more engaging features and technology for our customers and their fans. Clients such as sports personalities, teams and leagues, who employ the TP Platform have access to a myriad of features, including, but not limited to the following: Live Streaming. Customers can go live to their users as long as they are subscribers of the customer through the TP Platform. Video on Demand. Content library to allow subscribers to access paid pre-recorded content. Commerce Store. A store where a customers users can purchase our customer s products. Content Portal Blog & Video. A portal where a customer s users can view blogs and video. One Tap. Fast and easy for app subscription and payments. Administration Panel. The Content Management System (CMS) administrator platform allows customers to upload, edit and run managed customer content on the platform. Data Analytics. Access to our database allows our customers to obtain insight as to the number of views for any event or content by their subscribers via the Touchpoint Customer Resource Management (CRM) tool. Links to Apps. A link to all Apps and future Apps affiliated with the customer such as Twitter, Instagram, TikTok, YouTube, and the like. Non-Fungible Token. Customers can allow their users to purchase the customer s digital assets in the form of media files through the NFT store module. The TP Platform will allow our customers to seamlessly offer collectables in the form of limited edition or one of a kind video and audio performances (media files) utilizing Ethereum or other third party blockchains to allow for easy identification and authentication. Affiliate Program. Our affiliate Program enables tracking of user app traffic. Our Strategy We have already contacted a number of prospective host cities and experienced air race teams as part of the process of organizing the 2022 season. To enhance the appeal of the Series, we intend to showcase the latest technological developments in the application of green power in the aerospace industry along with aircraft with the latest advanced forms of mobility. Races will focus on future technologies, innovation, clean energy and lightweight mass market vehicles. New race categories will feature electric powered vehicles, vertical take-off and landing (EVTOL) and jetpacks. We will use our TP Platform to provide fans with access to the race teams and host cities, providing for merchandising events, broadcasting opportunities, gamification and ongoing subscriptions. Promotion of the WCAR will display the features of the TP Platform to other potential users and should accelerate discussions with athletes and celebrities interested in using the TP Platform to engage with their fanbase through content and other features. In addition to promoting the WCAR and seeking to grow the customer base of Touchpoint, we will continue to look at opportunities for growth in the media market through acquisition and promotion of other content, including the rights to other events in the digital media, sports and entertainment sectors which can be marketed and livestreamed to a world-wide fan base; as well as the acquisition of growing media and software companies which offer the ability to expand the services we provide to our clients.
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0000707388_star_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0000707388_star_prospectus_summary.txt
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+S-1/A 1 e621219_s1a-starequity.htm As filed with the Securities and Exchange Commission on January 18, 2022 Registration No. 333-261957 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Amendment No. 2 to FORM S-1 REGISTRATION STATEMENT under the Securities Act of 1933 Star Equity Holdings, Inc. (Exact Name of Registrant as Specified in its Charter) Delaware (State or Other Jurisdiction of Incorporation or Organization) 3845 (Primary Standard Industrial Classification Number) 33-0145723 (I.R.S. Employer Identification No.) Star Equity Holdings, Inc. 53 Forest Avenue, Suite 101 Old Greenwich, Connecticut 06870 Tel: (203) 489-9500 (Address, including zip code, and telephone number, including area code, of Registrant s principal executive offices) Jeffrey E. Eberwein Executive Chairman Star Equity Holdings, Inc. 53 Forest Avenue, Suite 101 Old Greenwich, Connecticut 06870 Tel: (203) 489-9500 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Spencer G. Feldman, Esq. Kenneth A. Schlesinger, Esq. Olshan Frome Wolosky LLP 1325 Avenue of the Americas, 15th Floor New York, New York 10019 (212) 451-2300 Mitchell Nussbaum, Esq. Angela Dowd, Esq. Loeb & Loeb LLP 345 Park Avenue New York, New York 10154 (212) 407-4000 Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act. Large Accelerated Filer Accelerated Filer Non-Accelerated Filer Smaller Reporting Company Emerging Growth Company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Proposed Maximum Aggregate Offering Price(1)(2) Amount of Registration Fee(3) Common stock, par value $0.0001 per share(1) (5) $17,250,000 $1,599.08 Pre-funded warrants, each warrant exercisable for one share of common stock(4) (5) — — Shares of common stock issuable upon exercise of the pre-funded warrants to purchase shares of common stock(5) (7) — — Common stock purchase warrants to purchase shares of common stock(8) — — Common stock underlying common stock purchase warrants(7) (8) 17,250,000 1,599.08 Underwriter s warrant to purchase shares of common stock(6) — — Common stock issuable upon exercise of the underwriter s warrant(7) 475,334 44.06 Total $34,975,334 $3,242.22(9) (1)Includes shares to cover the exercise of the over-allotment option granted to the underwriter. (2)Estimated solely for the purpose of calculating the amount of the registration fee in accordance with Rule 457(o) under the Securities Act of 1933, as amended (the "Securities Act"). Includes the offering price of any additional securities that the underwriter has the option to purchase. In accordance with Rule 457(o) under the Securities Act, the number of securities being registered and the proposed maximum offering price per pre-funded warrant and per common stock purchase warrant are not included in this table. (3)Calculated pursuant to Rule 457(o) based on an estimate of the proposed maximum aggregate offering price. (4)No separate fee is required pursuant to Rule 457(i) of the Securities Act.
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0000795212_kaspien_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0000795212_kaspien_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary does not contain all of the information that is important to you. You should read the entire prospectus, including the Risk Factors, before making an investment decision. Company History Kaspien Holdings Inc. (f/k/a Trans World Entertainment Corporation) ( Kaspien ), which, together with its consolidated subsidiaries, is referred to herein as the Company , we , us and our , was incorporated in New York in 1972. We own 100% of the outstanding Common Stock of Kaspien Inc. See below for additional information. Kaspien provides a platform of software and services to empower brands to grow their online distribution channels on digital marketplaces such as Amazon, Walmart and Target, among others. The Company helps brands achieve their online retail goals through its innovative and proprietary technology, tailored strategies and mutually beneficial partnerships. We are guided by 5 core principles: We are partner obsessed. Our customers are our partners. Every decision is focused on building mutually beneficial relationships that deliver results. We are insights driven. We make data actionable. Our curiosity drives us to discover opportunities early and often. We create simplicity. We challenge the status quo. We take the complicated and simplify it. We take ownership. We make things happen. We hold ourselves accountable and have a bias for action. We empower each other. We welcome and learn from diverse experiences. Our empathy ignites innovation and empowers meaningful change. Our Business Kaspien s mission is to accelerate partner brand growth on today s leading online marketplaces. Our vision is to become a global leader in the brand accelerator industry by improving partner efficiency and profitability. Our marketplace as a service ( MaaS ) approach consists of delivering technology-enabled services to our partners, including software and associated support services. Our primary focus marketplaces are Amazon US, Amazon CA, Amazon DE and Amazon EU (including UK), with additional service and support available for Target+ and Walmart marketplaces. Kaspien leverages its 13 years of ecommerce and online brand management experience to provide tech-enabled, partner-specific recommendations resulting in a clear plan of action, pricing, and timeline. Our team of ecommerce experts use internal and external software to deliver insights and results in the areas of listing creation, content optimization, paid advertising, campaign management and supply chain / logistical support. Our MaaS business delivers blended contribution margin across retail and agency models. This marketplace growth platform allows for a diversified go-to-market approach, enabling economies of scale for multiple operations. Retail business model: We buy inventory and use our expertise, technology, and services to generate revenue through marketplace transactions. Kaspien provides account management, brand communications, listings management, data reporting, joint business planning and comprehensive marketing support services. Our target partners are enterprise-level and other large growth brands, and derive margin based on pricing. Agency business model: We use our expertise, technology, and services to manage our partners marketplace presence through channel management with no inventory position. Kaspien provides account management, media planning, media analytics, search strategy, business planning and data reporting support services. Our target partners in this space range from small, first-to-market brands to full-scale, enterprise brands. We derive margin based on a percentage of ad spend, commissions, and/or specific service fees. TABLE OF CONTENTS The information in this prospectus is not complete and may be changed. The selling shareholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED JULY 28, 2022. PROSPECTUS Kaspien Holdings Inc. 4,275,342 shares of Common Stock Issuable upon Exercise of Pre-Funded Warrants and Warrants This prospectus relates to 4,275,342 shares of common stock issuable upon exercise of pre-funded warrants and warrants to purchase shares of common stock of Kaspien Holdings Inc., a New York corporation, that may be sold from time to time by the Selling Shareholders set forth in this prospectus under the heading Selling Shareholders beginning on page 14, which we refer to as the Selling Shareholders . We will not receive any proceeds from the sale of the securities under this prospectus, although we could receive up to $7,692,729 upon the exercise of all of the pre-funded warrants and warrants. Any amounts we receive from such exercises will be used for working capital and other general corporate purposes. Information regarding the Selling Shareholders, the amounts of shares of common stock that may be sold by them and the times and manner in which they may offer and sell the shares of common stock under this prospectus is provided under the sections titled Selling Shareholders and Plan of Distribution, respectively, in this prospectus. We have not been informed by any of the Selling Shareholders that they intend to sell the common stock covered by this prospectus and do not know when or in what amount the Selling Shareholders may offer the common stock for sale. The Selling Shareholders may sell any, all, or none of the common stock offered by this prospectus. The Selling Shareholders and intermediaries through whom such common stock are sold may be deemed underwriters within the meaning of the Securities Act of 1933, as amended (the Securities Act ), with respect to the securities offered hereby, and any profits realized or commissions received may be deemed underwriting compensation. We have agreed to indemnify the Selling Shareholders against certain liabilities, including liabilities under the Securities Act. Our common stock is listed on the Nasdaq Capital Market under the symbol KSPN . On July 27, 2022, the last reported sale price of our common stock was $2.60 per share. Investing in our securities involves a high degree of risk. See the section titled Risk Factors, which begins on page 5. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. You should rely only on the information contained in this prospectus. We have not authorized any dealer, salesperson or other person to provide you with information concerning us, except for the information contained in this prospectus. The information contained in this prospectus is complete and accurate only as of the date on the front cover page of this prospectus, regardless of the time of delivery of this prospectus or the sale of any securities. This prospectus is not an offer to sell these securities and we are not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. The date of this prospectus is , 2022 TABLE OF CONTENTS Kaspien provides all the software and services required to drive brand growth and achieve a brand s goals on Amazon, Walmart, and Target through multiple business models namely, Retail and Agency services. We are a technology enabled services company built for marketplace growth. A high-level visualization of our business model is shown in Figure 1 below. Our principal executive offices are located at 2818 N. Sullivan Rd. Ste 130, Spokane Valley, WA 99216, and our telephone number is (855) 300-2710. Private Placement of Shares of Common Stock and Warrants On July 12, 2022, we entered into a Securities Purchase Agreement (the PIPE Purchase Agreement ) with the Selling Shareholders for a private placement offering ( Private Placement ) of the Company s common stock or pre-funded warrants (with each pre-funded warrant exercisable for one share of common stock) in lieu thereof, and warrants exercisable for one share of common stock. Pursuant to the PIPE Purchase Agreement, the Company agreed to issue and sell 1,818,182 shares of its common stock or pre-funded warrants in lieu thereof together with warrants to purchase up to 2,457,160 shares of common stock. Each share of common stock and accompanying warrant was sold together at a combined offering price of $3.30 per share. The pre-funded warrants are immediately exercisable, at a nominal exercise price of $0.001, and may be exercised at any time until all of the pre-funded warrants are exercised in full. Under the terms of the pre-funded warrants, the Company may not effect the exercise of any such warrant, and a holder will not be entitled to exercise any portion of any such warrant, if, upon giving effect to such exercise, the aggregate number of shares of common stock beneficially owned by the holder (together with its affiliates, any other persons acting as a group together with the holder or any of the holder s affiliates, and any other persons whose beneficial ownership of common stock would or could be aggregated with the holder s for purposes of Section 13(d) or Section 16 of the Securities Exchange Act of 1934, as amended) would exceed 4.99% of the number of shares of common stock outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of such warrant, which percentage may be increased or decreased at the holder s election upon 61 days notice to the Company subject to the terms of such warrants, provided that such percentage may in no event exceed 9.99%. The warrants have an exercise price of $3.13 per share (subject to adjustment as set forth in the warrant), are exercisable upon issuance and will expire five years from the date of issuance. The warrants contain standard adjustments to the exercise price including for stock splits, stock dividend, rights offerings and pro rata distributions. The Private Placement closed on July 14, 2022. The Company intends to use the net proceeds from the private placement for working capital and other general corporate purposes. See Use of Proceeds. In connection with the PIPE Purchase Agreement, the Company entered into a registration rights agreement (the Registration Rights Agreement ) with the Selling Shareholders. Pursuant to the Registration Rights Agreement, the Company is required to file a resale registration statement (the Registration Statement ) with the Securities and exchange Commission (the SEC ) to register for resale of the Shares, the shares issuable upon exercise of the pre-funded warrants and the warrants within twenty (20) days after the Closing Date (the TABLE OF CONTENTS TABLE OF CONTENTS Page PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY This summary highlights information contained in other parts of this prospectus or incorporated by reference into this prospectus from our filings with the SEC listed in the section of the prospectus entitled Incorporation of Certain Information by Reference. Because it is only a summary, it does not contain all of the information that should be considered before purchasing our securities in this offering and it is qualified in its entirety by, and should be read in conjunction with, the more detailed information appearing elsewhere or incorporated by reference into this prospectus. You should read the entire prospectus, the registration statement of which this prospectus is a part, and the information incorporated by reference herein in their entirety, including the Risk Factors and our financial statements and the related notes incorporated by reference into this prospectus, before purchasing our securities in this offering. Unless the context requires otherwise, references in this prospectus to the Company, Navidea, we, us and our refer to Navidea Biopharmaceuticals, Inc. together with its wholly-owned subsidiaries, Navidea Biopharmaceuticals Europe Limited and Navidea Biopharmaceuticals Limited, and its majority-owned subsidiary, Macrophage Therapeutics, Inc. The Company Navidea Biopharmaceuticals, Inc. ( Navidea, the Company, we, us or our ), a Delaware corporation (NYSE American: NAVB), is a biopharmaceutical company focused on the development and commercialization of precision immunodiagnostic agents and immunotherapeutics. Navidea is developing multiple precision-targeted products based on our Manocept platform to enhance patient care by identifying the sites and pathways of undetected disease and enable better diagnostic accuracy, clinical decision-making and targeted treatment. Navidea s Manocept platform is predicated on the ability to specifically target the CD206 mannose receptor expressed on activated macrophages. The Manocept platform serves as the molecular backbone of Tc99m tilmanocept, the first product developed and commercialized by Navidea based on the platform. Other than Tc99m tilmanocept, which the Company has a license to distribute outside of Canada, Mexico and the United States, none of the Company s drug product candidates have been approved for sale in any market. Our business is focused on two primary types of drug products: (i) diagnostic substances, including Tc99m tilmanocept and other diagnostic applications of our Manocept platform, and (ii) therapeutic development programs, including therapeutic applications of our Manocept platform. Technology and Product Candidates Our primary development efforts over the last several years were focused on diagnostic products, including Tc99m tilmanocept, which the Company has a license to distribute outside of Canada, Mexico and the United States. Our more recent initiatives have been focused on diagnostic and therapeutic line extensions based on our Manocept platform. During the ongoing COVID-19 global pandemic, the Company s primary concern is the safety of its employees, the employees of its clinical trial sites, and the patients enrolled in its clinical trials. The Company is working hard to mitigate any safety risk along with any long-term impact on its clinical development programs. We do not believe there has been a significant impact to the Company s clinical development and regulatory timelines resulting from the ongoing COVID-19 global pandemic. However, the COVID-19 outbreak delayed enrollment in our NAV3-32 clinical study in the United Kingdom due to national COVID-19-related shutdowns. In addition, the regulatory approval process in India was delayed by the impact of COVID-19 in that country. As brief overview of recent developments in the Company s diagnostics area (additional details in following sections), Navidea has completed the Phase 2b clinical trial (NAV3-31) evaluating imaging repeatability, reproducibility, and stability, as well as the capacity of Tc99m tilmanocept imaging to serve as an early predictor of treatment efficacy of anti-tumor necrosis factor alpha ( TNF ) therapy in patients with moderate to severe Rheumatoid Arthritis ( RA ). In addition, the Company has completed enrollment into a Phase 2b clinical trial (NAV3-35) designed to accrue hand and wrist planar and single photon emission computed tomography/computed tomography ( SPECT/CT ) images from healthy subjects (with SPECT/CT imaging also done on a small group of RA patients) so that Navidea can complete a normative database in support of its RA imaging commercial product development. The Company s recently launched pivotal Phase 3 trial for RA (NAV3-33) is the next step in the development plan for indications in RA. The additional Phase 2b trial (NAV3-32) correlating Tc99m tilmanocept uptake in RA-involved joints with CD206 immunohistochemistry findings from synovial biopsies is actively recruiting. In addition, the investigator-initiated Phase 2 cardiovascular ( CV ) study was completed at Massachusetts General Hospital and a manuscript has been submitted by the investigators. Results of this study provided to date have paralleled data in our earlier published article, and these data are supportive of Navidea s hypothesis that tilmanocept can provide marked signal to background in a host of CV disease applications. Manocept Platform - Diagnostics and Therapeutics Background Navidea s Manocept platform is predicated on the ability to specifically target the mannose receptor (CD206) expressed primarily on activated macrophages. This flexible and versatile platform serves as a molecular backbone for purpose-built targeted imaging molecules that may significantly impact patient care by providing enhanced diagnostic accuracy, clinical decision-making, and target-specific treatment. This CD206-targeted drug platform is applicable to a range of diagnostic modalities, including SPECT, positron emission tomography ( PET ), gamma-scanning and intra-operative and/or optical-fluorescence detection, as well as delivery of therapeutic compounds that target macrophages and their role in a variety of immune- and inflammation-involved diseases. The United States Food and Drug Administration ( FDA )-approved sentinel node/lymphatic mapping agent, Tc99m tilmanocept, is representative of the ability to successfully exploit this mechanism to develop powerful new products and to expand this technology into additional diagnostic and therapeutic applications. PRE-EFFECTIVE AMENDMENT NO. 3 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 NAVIDEA BIOPHARMACEUTICALS, INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) Delaware 2835 31-1080091 (State or Other Jurisdiction of Incorporation or Organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) 4995 Bradenton Avenue, Suite 240 Dublin, Ohio 43017 (614) 793-7500 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant s Principal Executive Offices) Michael S. Rosol, Ph.D. Chief Medical Officer Navidea Biopharmaceuticals, Inc. 4995 Bradenton Avenue, Suite 240 Dublin, Ohio 43017 (614) 793-7500 (Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service) Copies to: William M. Mower, Esq. Barry I. Grossman, Esq. Andrew Tataryn, Esq. Sarah E. Williams, Esq. Maslon LLP Matthew Bernstein, Esq. 90 South 7th Street, Suite 3300 Ellenoff Grossman & Shole LLP Minneapolis, MN 55402 1345 Avenue of the Americas New York, NY 10105 Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Activated macrophages play important roles in many disease states and are an emerging target in many diseases where diagnostic uncertainty exists. Impairment of the macrophage-driven disease mechanisms is an area of increasing and proven focus in medicine. The number of people affected by all the inflammatory diseases combined is estimated at more than 40 million in the United States and up to 700 million worldwide, making macrophage-mediated diseases an area of remarkable clinical importance. There are many recognized disorders having macrophage involvement, including RA, atherosclerosis/vulnerable plaque, nonalcoholic steatohepatitis, inflammatory bowel disease, systemic lupus erythematosus, cancer generally including Kaposi s sarcoma ( KS ), leishmaniasis, and others that span general clinical areas in cancer immunology, autoimmunity, infectious diseases, cardiology, central nervous system diseases, and inflammation. For the near term, we have selected target diseases that may, if successfully developed, benefit from this technology. The Company has developed processes for producing the first two therapeutic Manocept immuno-construct series, the Manocept doxorubicin ( MAN-DOX ) series, which is designed to specifically target and kill or modify activated CD206+ macrophages by delivering doxorubicin, and the Manocept dexamethasone ( MAN-DEX ) series, which is designed to inhibit the inflammatory activity of activated CD206+ macrophages by delivering a potent anti-inflammatory agent, dexamethasone. We have expended significant efforts in recent years to improve chemical syntheses and to produce sufficient quantities of the MAN-DOX series and MAN-DEX series agents, along with the concomitant analytical standards, to provide material for current and planned preclinical animal studies and future clinical trials. Evaluation of advanced MAN-DOX and MAN-DEX constructs have been successfully performed in human macrophage cell culture assays with MAN-DOX advancing to evaluations in various syngeneic mouse models of cancer. Manocept Platform Immuno-Diagnostics Clinical Data Rheumatoid Arthritis Two Tc99m tilmanocept dose escalation studies in RA have been completed. The first study was completed and included 18 subjects (nine with active disease and nine healthy subjects) dosed subcutaneously ( SC ) with 50 and 200 g/2mCi Tc99m tilmanocept (ClinicalTrials.gov NCT02683421). The results of this study were presented at five international meetings, including Biotechnology Innovation Organization, Society of Nuclear Medicine and Molecular Imaging ( SNMMI ), and The American College of Rheumatology ( ACR ). In addition, based on completion of extensive preclinical dosing studies pursuant to our dialog with the FDA, we have completed a Phase 1/2 study involving intravenous ( IV ) dosing of 39 subjects with IV-administered Tc99m tilmanocept (ClinicalTrials.gov NCT02865434). In conjunction with this study, we completed pharmacokinetic, pharmacodynamics and radiation dosimetry phases in human subjects as well. The majority of the costs of these studies were supported through a Small Business Innovation Research ( SBIR ) grant (NIH/NIAMSD Grant 1 R44 AR067583-01A1). Results of the Phase 1/2 study were presented at the June 2018 and June 2019 SNMMI meetings, the 2018 European League Against Rheumatism ( EULAR ) meeting and the 2018 ACR meeting. A manuscript intended for peer reviewed publication is in preparation. The Phase 1/2 study enrolled subjects with active, moderate-to-severe RA, and healthy controls. Results from the completed trial demonstrated that Tc99m tilmanocept is well-tolerated with no serious adverse events, adverse drug reactions, or drug-related adverse events observed. Additionally, static planar images revealed joint-specific Tc99m tilmanocept localization in RA subjects to disease-involved joints of the shoulders, knees, hands, and feet, but no joint-specific localization in healthy control subjects, revealing potentially significant immunodiagnostic information about CD206-expressing synovial macrophage involvement in RA. An optimal imaging time window post-Tc99m tilmanocept IV administration, as well as optimal dosing, were also determined. In April 2019, the Company received feedback from the FDA regarding the Company s planned clinical studies to evaluate joint disease in patients with RA and monitor patient response to therapy. The Company s proposed RA studies were discussed with the FDA during an in-person meeting and through follow-up collaborative efforts. The FDA communicated that the first study, a Phase 2b trial, was aligned with expectations for the studies and that they would continue to work with Navidea as the Company progressed into the second Phase 2b trial correlating Tc99m tilmanocept uptake in RA-involved joints with CD206 immunohistochemistry findings from synovial biopsies and into the planned Phase 3 clinical trial. In May 2019, we began enrolling patients into the first Phase 2b study, (NAV3-31), entitled Evaluation of the Precision and Sensitivity of Tilmanocept Uptake Value ( TUV ) on Tc99m Tilmanocept Planar Imaging (ClinicalTrials.gov MCT03938636). This study, since completed, provided confirmatory support necessary to initiate Navidea s Phase 3 study program. In October 2019, the Company performed its first interim analysis of this trial, covering subjects enrolling into Arms 1 and 2. The results of this interim analysis were in line with the Company s hypotheses that Tc99m tilmanocept can provide robust, stable imaging in healthy subjects as well as in patients with active RA, and provide the fundamental information needed to keep moving forward into the Phase 3. A summary of these results was presented at the 2020 EULAR meeting. In May 2020, the Company announced the results of its second interim analysis, covering Arm 3 of the trial. This Arm mirrored the upcoming Phase 3 in design and provided information relevant for sample size calculation for the Phase 3 as well as support for the hypothesis that Tc99m tilmanocept imaging can provide an early indicator of treatment efficacy of anti-TNF therapeutics. These interim results were presented at the 2020 ACR meeting. In June 2020, the Company announced full enrollment into this trial, with imaging events completed in each patient enrolled in Arm 3. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment that specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. In February 2021, the Company submitted its formal briefing book to the FDA, containing detailed analysis and discussion of the Company s then-ongoing Phase 2b study (NAV3-31) and prior studies in RA as well as the design and statistical analysis plan for the proposed Phase 3 for FDA comment. Following the feedback received from the FDA at the end of March 2021, the Company continued to work toward completing the analysis of the full NAV3-31 trial dataset and submitted the resultant briefing book containing the results of this analysis in preparation for the standard End-of-Phase 2 Type B meeting, which took place on September 1, 2021. The Company had a constructive meeting with the FDA and, based on the discussion in this meeting and follow-up communication, made agreed-upon modifications to the trial design for the Phase 3 study (NAV3-33). The Company submitted the modified protocol back to the FDA and initiated the study in December 2021. Following additional feedback from the FDA, the Company made modifications to several of the objectives. Enrollment into the Phase 3 study is ongoing. The pivotal Phase 3 study program will determine Tc99m tilmanocept s capability to serve as an early predictor of treatment response to anti-TNF therapy in patients with RA. The current aim is for completion of the Phase 3 by end of 2023 with NDA submission targeted for 2024. Cardiovascular Disease In collaboration with researchers at Massachusetts General Hospital, Navidea has completed two investigator-initiated clinical studies evaluating Tc99m tilmanocept s ability to enable imaging of atherosclerotic plaques. Results of these studies provide strong preliminary evidence of the potential of Tc99m tilmanocept to accumulate specifically in and enable imaging of non-calcified atherosclerotic plaques. Non-calcified atherosclerotic plaques include plaques with morphologies indicating a high risk of rupture. Rupture of such plaques causes myocardial infarctions (heart attacks) and a significant portion of ischemic strokes. The studies compared aortic Tc99m tilmanocept uptake imaged by SPECT/CT in clinically asymptomatic subjects with intermediate Framingham Risk Scores ( FRS ) who were infected with Human Immunodeficiency Virus ( HIV ) as compared to healthy, uninfected, FRS and age-matched subjects. Tc99m tilmanocept SPECT/CT images were compared to aortic images of the same subjects obtained by contrast enhanced coronary computed tomography angiography and/or [18F]NaF PET/CT. A nine-subject study to evaluate diagnostic imaging of emerging atherosclerosis plaque with the Tc99m tilmanocept product dosed SC was performed (ClinicalTrials.gov NCT02542371). The results of this study were presented at two major international meetings (Conference on Retroviruses and Opportunistic Infections and SNMMI, 2017) and published in early release in the Journal of Infectious Diseases in January 2017 (published in the circulated version, Journal of Infectious Diseases (2017) 215 (8): 1264-1269), confirming that the Tc99m tilmanocept product can both quantitatively and qualitatively target non-calcified plaque in the aortic arch of Acquired Immunodeficiency Syndrome ( AIDS ) patients (supported by NIH/NHLBI Grant 1 R43 HL127846-01). This study was later expanded to include up to 31 participants, and has achieved full enrollment, with a manuscript submitted. A second Phase 1/2 investigator-initiated study in cooperation with Massachusetts General Hospital in subjects with HIV was initiated that expanded the original study in both the scope of the drug administration as well as the diagnostic assessment of the subjects. This study enrolled both AIDS subjects and healthy controls in imaging non-calcified plaque using IV and SC-administered Tc99m tilmanocept and will expand the initial investigation to the assessment of aortic plaque as well as carotid and coronary arteries. Initial analysis suggested that the SC route of administration led to superior signal-to-background in areas of non-calcified plaque. These results are being further assessed. Navidea has also been awarded a $225,000 phase 1 Small Business Technology Transfer grant (1R41HL147640-01A1) entitled Gallium 68 Tilmanocept for PET Imaging of Atherosclerosis Plaques. This grant supported a research collaboration between Navidea and Dr. Suzanne Lapi of the University of Alabama Birmingham evaluating a mouse model of atherosclerosis. This work has as its aim the evaluation of [68]gallium tilmanocept and various next generation imaging agents for visualizing plaques. Activities began in the fourth quarter of 2019. All images have been acquired with efforts now focused on final data analysis. Kaposi s Sarcoma We initiated and completed a study of KS in 2015 (ClinicalTrials.gov NCT022201420) and received additional funding from the National Institutes of Health ( NIH ) in 2016 to continue diagnostic studies in this disease. The new support not only continues the imaging of the cutaneous form of this disease but expands this to imaging of visceral disease via IV administration of Tc99m tilmanocept (NIH/NCI 1 R44 CA192859-01A1; ClinicalTrials.gov NCT03157167). This now-escalated study includes a pathology/biopsy component as well as an imaging component to determine pathology concordance with image assessment. We received Institutional Review Board approval of the clinical protocol and initiated a Phase 1/2 clinical study in KS in 2017. This trial has completed enrollment and imaging, with final data analysis and clinical study report preparation well underway. Tuberculosis ( TB ) In April 2019, the Company announced that Professor Mike Sathekge, MBChB, M. Med (Nuclear Medicine), PhD, Professor and Head of the Department of Nuclear Medicine in the Faculty of Health Sciences at the University of Pretoria/Steve Biko Academic Hospital, planned to initiate a comparative study evaluating the use of tilmanocept in patients with TB. The purpose of this ongoing study is to explore using 68Ga tilmanocept as an aid in TB patient management while contributing to the better understanding of the biology of TB granulomas. CD206+ macrophages constitute one of the most abundant cell types in TB granulomas. Therefore, a molecular probe such as 68Ga-labeled tilmanocept targeting mannose receptor CD206 expressed on macrophages holds great promise not only in understanding the biology of TB granulomas, but may also support future development of a tilmanocept-like drug delivery vehicle for delivering therapeutic interventions to TB granulomas. Navidea has provided tilmanocept for use in this study, and several subjects have been injected and imaged to date. Successful completion of this study could support an extended claim of 68Ga-tilmanocept. Biomarker Application and Qualification In November 2017, the Company commenced the qualification of the biomarker CD206 with the FDA Biomarker Section of The Center for Drug Evaluation and Research ( CDER ). As per FDA protocol, Navidea submitted a draft letter of intent ( LOI ) to CDER prior to the November 2017 meeting. According to the CDER directive, the Biomarker Qualification Program was established to support the CDER s work with external stakeholders to develop biomarkers that aid in the drug development process. Through the FDA s Biomarker Qualification Program, an entity may request regulatory qualification of a biomarker for a particular context of use ( COU ) in drug development. Following the meeting with the FDA, and because of Navidea s data sets and the general external publication database, Navidea, in conjunction with FDA, is now reviewing the LOI with the FDA s recommended consultants. Navidea has revised the LOI draft strategy in order to expedite the application process. In March 2018, Navidea had a follow-up meeting with the FDA s assigned strategist, during which the potential to further narrow the LOI elements was reviewed. Navidea is continuing the process of finalizing the COU LOI and providing the background data sets for qualification review with the FDA/CDER. Additional meetings have taken place and the pursuit of this qualification is ongoing. Manocept Platform In-Vitro and Pre-Clinical Immunotherapeutics Data The Company has been developing Manocept platform drug delivery constructs that carry various payloads including doxorubicin and dexamethasone. Chemical synthesis techniques have advanced considerably, resulting in more robust and reproducible synthesis protocols that provide products with chemical attributes indicative of enhanced in vivo activity. The most advanced drug delivery construct carries a doxorubicin payload and is now in its third generation of chemical synthesis protocol design. This third-generation doxorubicin carrying construct has been extensively evaluated in human macrophage cell culture assays and in three experiments using syngeneic mouse cancer models. These experiments show that at treatment doses below what is required to kill macrophages, the doxorubicin-carrying constructs dramatically alters the immunological behavior of macrophages, making them more proinflammatory. In one of the syngeneic mouse tumor experiments, the MAN-DOX construct significantly synergized the activity of another anticancer therapy producing anti-tumor activity that was greater than either treatment alone. Results from this study were presented at the New York Academy of Sciences Frontiers in Cancer Immunotherapy 2021 conference on May 14, 2021. Near-term experiments with the Manocept doxorubicin construct include further studies in macrophage cell culture, additional syngeneic mouse tumor models, and a toxicity study in rats. Work involving a second generation Manocept dexamethasone-carrying construct has progressed to evaluations in human macrophage culture assays. Efforts developing Manocept constructs with different payloads are ongoing. Three new Manocept constructs carrying payloads other than doxorubicin or dexamethasone have progressed to evaluations in macrophage cell culture assays. These new constructs include two carrying novel bisphosphonate drugs, and the results of studies of these two constructs in macrophage cell culture assays were presented at the Tumor Myeloid-Directed Therapies Summit in June 2022. Kaposi s Sarcoma The novel MAN-DOX class constructs are designed to specifically deliver doxorubicin, a chemotoxin, which can kill KS tumor cells and their tumor-associated macrophages, potentially altering the course of cancer. We received additional funding to continue therapeutic studies in this disease with the goal of completing an investigational new drug ( IND ) submission for a Manocept construct (MAN-DOX class of compounds) consisting of tilmanocept linked to doxorubicin for the treatment of KS. Efforts supported by this grant (NIH/NCI 1 R44 CA206788-01) are now complete. The results greatly advanced our knowhow for robustly and reproducibly synthesizing MAN-DOX and related constructs carrying other payloads. The grant-supported efforts were presented at the New York Academy of Sciences Frontiers in Cancer Immunotherapy 2021. Other Immunotherapeutic Applications The Company continues to evaluate emerging data in other disease states to define areas of focus, development pathways and partnering options to capitalize on the Manocept platform, including ongoing studies in KS, RA and infectious diseases. The immuno-inflammatory process is remarkably complex and tightly regulated with indicators that initiate, maintain and shut down the process. Macrophages are immune cells that play a critical role in the initiation, maintenance, and resolution of inflammation. They are activated and deactivated in the inflammatory process. Because macrophages may promote dysregulation that accelerates or enhances disease progression, diagnostic and therapeutic interventions that target macrophages may open new avenues for controlling inflammatory diseases. There can be no assurance that further evaluation or development will be successful, that any Manocept platform product candidate will ultimately achieve regulatory approval, or if approved, the extent to which it will achieve market acceptance. Risks Associated with Our Business and this Offering Our business and our ability to implement our business strategy are subject to numerous risks, as more fully described in the section of this prospectus entitled Risk Factors and under similarly titled headings of the documents incorporated herein by reference. You should read these risks before you invest in our securities. We may be unable, for many reasons, including those that are beyond our control, to implement our business strategy. In particular, risks associated with our business include: The global COVID-19 pandemic may continue to impact our business, financial condition or prospects, including a decline in the volume of procedures using our products, potential delays and disruptions to clinical trials, global supply chains, manufacturing activities, logistics, operations, employees and contractors, the business activities of our suppliers, distributors, customers and other business partners, as well as the effects on worldwide economies, financial markets, social institutions, labor markets and healthcare systems. The current conflict between Ukraine and Russia may impact our business, financial condition or prospects, including extreme volatility in the global capital markets making debt or equity financing more difficult to obtain, more costly or more dilutive, delays and disruptions of the global supply chains and the business activities of our suppliers, distributors, customers and other business partners. There is substantial doubt about our ability to continue as a going concern, which may affect our ability to obtain future financing and may require us to curtail our operations. We will need to raise additional capital to support our operations. We have incurred losses since our inception and anticipate that we will continue to incur significant losses for the foreseeable future, and our future profitability is uncertain. Our product candidates must undergo rigorous clinical testing, such clinical testing may fail to demonstrate safety and efficacy and any of our product candidates could cause undesirable side effects, which would substantially delay or prevent regulatory approval or commercialization. We are dependent on patents and proprietary technology. If we fail to adequately protect this intellectual property or if we otherwise do not have exclusivity for the marketing of our products, our ability to commercialize products could suffer. If our competitors are able to develop and market products that are more effective, safer or more affordable than ours, or obtain marketing approval before we do, our commercial opportunities may be limited. In addition to the foregoing risks, you should carefully consider the risks and uncertainties related to the rights offering described under Risk Factors beginning on page 17 of this prospectus. Recent Developments As disclosed in the notes to the financial statements included in the Company s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, the Company has been engaged in ongoing litigation with Capital Royalty Partners II L.P. ( CRG ), in its capacity as a lender and as control agent for other affiliated lenders party to the CRG Loan Agreement (collectively, the Plaintiffs ), in the District Court of Harris County, Texas (the Texas Court ). In April 2018, the Plaintiffs asserted claims against Navidea and Macrophage Therapeutics, Inc. for alleged breaches of a Global Settlement Agreement ( GSA ) and Loan Agreement entered into by Navidea arising from the Navidea s challenge to the Plaintiffs drawing down on letters of credit in the full amount of $7,153,000 which Navidea claims resulted in an overpayment of approximately $4.2 million under the Loan Agreement. The Plaintiffs also seek declaratory judgment relief that essentially mirrors their claims for affirmative relief, i.e., that the Company breached the GSA and indemnification provision of the Loan Agreement, and that the Plaintiffs did not breach the GSA. On November 21, 2021, the Texas Court entered an interlocutory judgment declaring that CRG did not breach the GSA, but that Navidea did breach the GSA and the indemnification provision of the CRG Loan Agreement. In the interlocutory order, the Texas Court sua sponte awarded as damages reasonable attorneys' fees in an amount, if any, to be determined at trial. The case is set for a bench trial on August 26, 2022. CRG has made a claim of approximately $2.8 million in attorneys' fees they contend they are entitled to in connection with the alleged breaches of the agreements. Navidea contends CRG have received payments in excess of the amounts owed under the CRG Loan Agreement and are not entitled to an award of attorney s fees under the GSA or Loan Agreement. Discovery has been completed and a motion to amend the interlocutory partial summary judgment is pending. The amount of ultimate liability, if any, with respect to this action is unknown. On January 28, 2022, the Company received a notification from the NYSE American LLC (the NYSE American ) stating that the Company was not in compliance the $6.0 million stockholders equity requirement of Section 1003(a)(iii) of the NYSE American Company Guide. As required by the NYSE American, the Company submitted a plan to the NYSE American by February 28, 2022 advising of actions it has taken or will take to regain compliance with the continued listing standards by July 28, 2023. On April 8, 2022, the Company received a notification (the Acceptance Letter ) from the NYSE American that the Company s plan to regain compliance was accepted. The Acceptance Letter also stated that the Company is also not in compliance with Sections 1003(a)(i) and 1003(a)(ii) of the NYSE American Company Guide, which require an issuer to have stockholders equity of (i) $2.0 million or more if it has reported losses from continuing operations and/or net losses in two out of its three most recent fiscal years, and (ii) $4.0 million or more if it has reported losses from continuing operations in three out of its four most recent fiscal years. The Acceptance Letter noted that the Company had stockholders equity of $624,743 as of December 31, 2021 and has reported net losses from continuing operations in its five most recent fiscal years ended December 31, 2021. The NYSE American has granted the Company a plan period through July 28, 2023 to regain compliance with Sections 1003(a)(i), (ii) and (iii). If the Company is not in compliance with all continued listing standards by that date or if the Company does not make progress consistent with the plan during the plan period, the NYSE American may commence delisting procedures. The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and we are not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED August 2, 2022 Subscription Rights to Purchase Up to 35,000 Units Consisting of up to 35,000 Shares of Series I Convertible Preferred Stock and Warrants to Purchase up to 53,830,000 Shares of Common Stock at a Subscription Price of $1,000 per Unit (and up to 53,830,000 shares of Common Stock underlying such Series I Convertible Preferred Stock) We are distributing to holders of our common stock, $0.001 par value, and to holders of our Underwriter Warrants (as defined herein), Series D preferred stock and Series F preferred stock, at no charge, non-transferable subscription rights to purchase up to 35,000 units ( Units ). Each Unit consists of one (1) share of our Series I convertible preferred stock ( Series I preferred stock ) and a warrant to purchase 1,538 shares of our common stock at an exercise price of $0.70 per share from the date of issuance through its expiration five years from the date of issuance (the warrants ). Each share of Series I preferred stock is convertible at the option of the holder at any time into a number of shares of our common stock equal to the quotient of stated value of the Series I preferred stock divided by the conversion price (initially, $0.65 per share). We refer to the offering that is the subject of this prospectus as the rights offering. In the rights offering, you will receive one (1) subscription right for every share of common stock owned or deemed owned as of 4:00 p.m., Eastern Time, on August 3, 2022, the record date of the rights offering (the Record Date ). Shares that are deemed owned refer to the shares issuable upon exercise of the outstanding warrants issued to the underwriter in our public offering in 2019 (the Underwriter Warrants ) and the shares issuable upon conversion of the outstanding Series D preferred stock and Series F preferred stock. The Series I preferred stock and warrants comprising the Units will separate upon the closing of this rights offering and will be issued separately; however, they may only be purchased as a Unit and the Unit will not trade as a separate security. The subscription rights will not be tradeable. There is no minimum number of Units that we must sell in order to complete the rights offering. Each subscription right consists of a basic subscription right and an over-subscription privilege. Each subscription right will entitle you to purchase one Unit, which we refer to as the basic subscription right, at a subscription price equal to $1,000 per Unit, subject to proration among participants exercising their basic subscription right. If you exercise your basic subscription right in full, and any portion of the Units remain available under the rights offering which are unsubscribed, you will be entitled to an over-subscription privilege to purchase a portion of the unsubscribed Units at the subscription price, subject to proration among participants exercising their over-subscription privilege, which we refer to as the over-subscription privilege. The subscription rights will expire if they are not exercised by 5:00 p.m., Eastern Time, on August 17, 2022, unless the rights offering is extended or earlier terminated by us. If we elect to extend the rights offering, we will issue a press release announcing the extension no later than 9:00 a.m., Eastern time, on the next business day after the most recently announced expiration date of the rights offering. We may extend the rights offering for a period not to exceed 45 days in our sole discretion. Once made, all exercises of subscription rights are irrevocable. All subscription payments will be deposited into an escrow account maintained by the subscription agent for the benefit of the holders exercising their subscriptions under the rights offering, and if the rights offering is not completed for any reason all funds will be promptly returned to such subscribers in the amounts advanced in connection with their respective exercises. John K. Scott, Jr., vice chairman of our board of directors and the beneficial owner of approximately 31.5% of our outstanding common stock as of the Record Date, may exercise some or all of his subscription rights, but he has not made a decision with respect to exercising his basic subscription right or over-subscription privilege at this time. Certain holders of the subscription rights, including Mr. Scott, will have the option to pay the subscription price in this rights offering by cancelling or exchanging their shares of Series D preferred stock, Series F preferred stock and Series G preferred stock and our indebtedness evidenced by a secured term note in the aggregate principal amount of $2.5 million plus accrued but unpaid interest payable to Mr. Scott ( Term Note ), instead of paying cash. The fair market value of the shares of each series of preferred stock and the Term Note to be cancelled or exchanged in the rights offering will be determined by an independent appraisal. We have engaged Maxim Group LLC to act as the dealer-manager for this rights offering. We have not entered into any standby purchase agreement or other similar arrangement in connection with this rights offering. The rights offering is being conducted on a best-efforts basis. We have also engaged Broadridge Corporate Issuer Solutions, Inc. ( Broadridge ) to serve as our subscription and information agent for the rights offering. The subscription agent will hold in escrow the funds we receive from subscribers until we complete or cancel this rights offering. We are conducting the rights offering to raise capital that we intend to use for funding the Company s pivotal Phase 3 trial for Rheumatoid Arthritis (NAV3-33) (as described below), obtaining regulatory approvals, working capital, and for general corporate purposes. You should carefully consider whether to exercise your subscription rights prior to the expiration of the rights offering. All exercises of subscription rights are irrevocable, even if the rights offering is extended by our board of directors for a period of up to 45 days. Corporate Information Our corporate headquarters are located at 4995 Bradenton Avenue, Suite 240, Dublin, Ohio 43017-3552, and our telephone number is (614) 793-7500. We maintain a website at www.navidea.com, to which we regularly post copies of our press releases as well as additional information about us. The information contained on, or that can be accessed through, our website is not a part of this prospectus. We have included our website address in this prospectus solely as an inactive textual reference. Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the Exchange Act ), are available free of charge through the investor relations page of our internet website as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0000811868_ecrid-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0000811868_ecrid-inc_prospectus_summary.txt
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+PROSPECTUS SUMMARY The information presented is a brief overview of the key aspects of the offering. The prospectus summary contains a summary of information contained elsewhere in this prospectus. You should carefully read all information in the prospectus, including the financial statements and the notes to the financial statements under the Financial Statements section beginning on page 31 prior to making an investment decision. General Information about our Company Ecrid, Inc. ( Ecrid , or the Company ) was incorporated under the laws of the State of Florida on September 15, 2010. A new corporation was required to be formed in Nevada in February of 2017 due to the name change of Dpollution, Inc. to ECRID, Inc. Ecrid is a developmental stage corporation formed to provide products and services within the credit repair community. We provide an internet interactive software to allow consumers that need credit repair to track all the monthly payments they make and pay all their bills on-time. Once a consumer begins to use the Ecrid bill pay system, the system rewards them with an ECRID credit rating of up to 900 points. Each time the consumer does not pay a bill on-time, Ecrid subtracts points from the credit rating Ecrid assigns the consumer. Maintaining a high Ecrid score will enable the consumer lenders to buy a car, house or other payment related things. Ecrid is currently an emerging growth company under the JOBS Act. A company loses its emerging growth company status on (i) the last day of the fiscal year during which it had total annual gross revenues of $1,000,000,000 or more; (ii) the last day of the fiscal year following the fifth anniversary of the date of its first sale of common equity securities pursuant to an effective registration statement under the Securities Exchange Act of 1934, as amended (the Exchange Act ); (iii) the date on which it has, during the previous 3-year period, issued more than $1,000,000,000 in non-convertible debt; or (iv) the date on which it is deemed to be a 'large accelerated filer', as defined in section 240.12b- 2 of title 17, Code of Federal Regulations, or any successor thereto. As an emerging growth company, Ecrid is exempt from certain obligations of the Exchange Act including those found in Section 14A(a) and (b) related to shareholder approval of executive compensation and golden parachute compensation. Furthermore, Section 103 of the JOBS Act provides that as an emerging growth company , Ecrid is not required to comply with the requirement to provide an auditor's attestation of ICFR under Section 404(b) of the Sarbanes-Oxley Act for as long as Ecrid qualifies as an emerging growth company. However, an emerging growth company is not exempt from the requirement to perform management's assessment of internal control over financial reporting. Our founder and sole officer and director, Cleveland Gary, who has education in Business Administration and over 25 years of work experience in business administration, currently handles all facets of the Company's operations, and our strategic development. Our independent registered public accountant has issued an audit opinion for Ecrid which includes a statement expressing substantial doubt as to our ability to continue as a going concern. If we are unable to obtain additional working capital our business may fail. We currently use approximately $5,000 per month in our operations. At this rate we estimate our present cash will fund Ecrid for the next 12 months. We require additional capital in order to continue and advance our business plan. Currently, we rely on the initial funding provided by our founder and sales of our products and services to meet the ongoing expenses of operating the business. We believe that we will need a minimum of $138,000 in capital, including the capital raised in this offering for the Company, in order to maintain our current and planned operations through the next twelve months. They are estimates only and derived from research and marketing data accumulated by our sole officer and director. We anticipate to $25,000 in offering expenses, $20,000 in SEC reporting and compliance, $5,500 in advertising and marketing, $4,000 in website design, $12,000 in operating and equipment, and $11,500 to maintain our general and administrative functions over the next twelve months. We intend to raise the capital through the sale of shares of our common stock and/or through the sale of our products and services. We cannot guarantee that we will be able to obtain the necessary capital. We are a Shell Company, as defined in Rule 405 promulgated by the SEC under the Securities Act. A Shell Company is one that has no or nominal operations and either: (i) no or nominal assets; or (ii) assets consisting primarily of cash or cash equivalents. As a Shell Company, we are restricted in our use of Registrations on Form S-8 under the Securities Act; the lack of availability of the use of Rule 144 by security holders; and the lack of liquidity in our stock. Form S-8 Shell companies are prohibited from using Form S-8 to register securities under the Securities Act. If a company ceases to be a Shell Company, it may use Form S-8 sixty calendar days, provided it has filed all reports and other materials required to be filed under the Exchange Act during the preceding 12 months (or for such shorter period that it has been required to file such reports and materials after the company files Form 10 information, which is information that a company would be required to file in a registration statement on Form 10 if it were registering a class of securities under Section 12 of the Exchange Act. This information would normally be reported on a current report on Form 8-K reporting the completion of a transaction that caused the company to cease being a Shell Company. Unavailability of Rule 144 for Resale Rule 144(i) Unavailability to Securities of Issuers With No or Nominal Operations and No or Nominal Non-Cash Assets provides that Rule 144 is not available for the resale of securities initially issued by an issuer that is a Shell Company. We have identified our company as a Shell Company and, therefore, the holders of our securities may not rely on Rule 144 to have the restriction removed from their securities without registration or until the Company is no longer identified as a Shell Company and has filed all requisite periodic reports under the Exchange Act for the period of twelve (12) months. As a result of our classification as a Shell Company, our investors, including investors in this offering, are not allowed to rely on the safe harbor provisions of Rule 144, promulgated pursuant to the Securities Act, so as not to be considered underwriters in connection with the sale of our securities until one year from the date that we cease to be a Shell Company. This will likely make it more difficult for us to attract additional capital through subsequent unregistered offerings because purchasers of securities in such unregistered offerings will not be able to resell their securities in reliance on Rule 144, a safe harbor on which holders of restricted securities usually rely to resell securities. The Terms of the Offering Securities Being Offered Up to 40,000,000 Shares of common stock by the Company and 10,000,000 are being offered by the Selling Shareholders Minimum Securities Being Offered: There is no minimum number of shares that need to be purchased for the Offering to be consummated. Initial Offering Price: We will sell our shares at a fixed price of $0.50 per share. This price was determined arbitrarily by us. The Selling Shareholders may sell their shares in the over-the-counter market or otherwise, at market prices prevailing at the time of sale, at prices related to the prevailing market price, or at negotiated prices. We will not receive any proceeds from the sale of shares by the Selling Shareholders. Compensation: No compensation will be paid to the officer and director in connection with the sale of the shares. Termination of Offering: The offering will conclude when all of the 40,000,000 shares of common stock have been sold by the Company and all 10,000,000 shares are sold by the Selling Shareholders or 365 days from the date of this prospectus, whichever occurs earlier. We may decide to terminate the offering for no reason whatsoever at the discretion of our management team. Risk Factors: The securities offered hereby involve a high degree of risk and should not be purchased by investors who cannot afford the loss
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0000819926_sharing_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0000819926_sharing_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1 RISK FACTORS 8 RISKS RELATING TO OUR COMPANY 8 RISKS RELATED TO DOING BUSINESS IN THE PEOPLE S REPUBLIC OF CHINA 13 RISKS ASSOCIATED WITH OUR SECURITIES 22 USE OF PROCEEDS 24 DETERMINATION OF THE OFFERING PRICE 24 SELLING SECURITY HOLDERS 24 PLAN OF DISTRIBUTION 27 DESCRIPTION OF SECURITIES 29 DESCRIPTION OF BUSINESS 34 DESCRIPTION OF PROPERTIES 38 PROPERTIES LEGAL PROCEEDINGS 38 MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS 38 SECURITIES AUTHORIZED UNDER EQUITY COMPENSATION PLANS 38 MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION 39 RESULTS OF OPERATIONS 40 CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 45 DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS 45 ITEM 11. EXECUTIVE COMPENSATION 49 DIRECTOR COMPENSATION 51 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS 52 ITEM 13 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS 53 RELATED PARTY TRANSACTIONS 53 INTEREST OF NAMED EXPERTS AND COUNSEL 53 EXPERTS 54 DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES 54 WHERE YOU CAN FIND MORE INFORMATION 54 CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 54 INDEX TO FINANCIAL STATEMENTS F-1 PROSPECTUS SUMMARY You should read the following summary together with the more detailed information and the financial statements appearing elsewhere in this Prospectus. This Prospectus contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth under Risk Factors and elsewhere in this Prospectus. Unless the context indicates or suggests otherwise, references to we, our, us, the Company, Sharing Economy or the Registrant refer to Sharing Economy International Inc., a Nevada corporation, and its wholly- owned subsidiaries. Please refer to pages 37 for a list of our wholly-owned subsidiaries. OUR COMPANY Overview of Sharing Economy The Company is currently focused on targeting the technology and global sharing economy markets, by developing online platforms and rental business partnerships that will drive the global development of sharing through economical rental business models. In connection with this initiative, the Company has formed or acquired 17 subsidiaries, all but one of which are incorporated in the BVI or Hong Kong, with the remaining subsidiary incorporated in the PRC. We believe a true peer-to-peer sharing economy based on rentals will take significant market share in both the business and consumer markets over the next few years. Sharing Economy s business models are hosted through digital platforms that enable more precise, real-time measurement of spare capacity and have the ability to dynamically connect that capacity with those who need it. These digital platforms handle transactions that offer access over ownership through renting, lending, subscribing, reselling, swapping or donating. Consumers who use sharing economy business models are often more comfortable with transactions that involve deeper social interactions than traditional methods of exchange. Our fiscal year-end date is December 31. Our board of directors consists of four persons, who are listed and whose backgrounds are described on pages 47-48. One of our directors, Chan Pak Hei Jefferson, also serves as our Chief Executive Officer. Our principal administrative offices are located at No. 85 Castle Peak Road, Castle Peak Bay, Tuen Mun, N.T., Hong Kong. Our primary website is www.seii.com. We do not incorporate the information on or accessible through our website into this prospectus, and you should not consider any information on, or that can be accessed through, our websites a part of this prospectus. We are not a Hong Kong operating company but a Nevada holding company with operations conducted through our wholly owned subsidiaries based in the BVI, Hong Kong and the PRC. Our investors hold shares of common stock in Sharing Economy, the Nevada holding company. This structure presents unique risks as our investors may never directly hold equity interests in our BVI, Hong Kong and PRC subsidiaries and will be dependent upon contributions from our subsidiaries to finance our cash flow needs. Our ability to obtain contributions from our subsidiaries is significantly affected by regulations promulgated by the BVI, Hong Kong and, to a significantly lesser extent, PRC authorities. Any change in the interpretation of existing rules and regulations or the promulgation of new rules and regulations may materially affect our operations and or the value of our securities, including causing the value of our securities to significantly decline or become worthless. 1 Sharing Economy and our BVI, Hong Kong and PRC subsidiaries are not required to obtain permission from Chinese authorities including the China Securities Regulatory Commission, or CSRC, or Cybersecurity Administration Committee, or CAC, to operate or to issue securities to foreign investors. However, there may be material risks associated with some of our operations being in Hong Kong. For example, as a U.S.-listed Hong Kong public company, we may face heightened scrutiny, criticism and negative publicity, which could result in a material change in our operations and the value of our common stock. Description of Principal Business We have acquired and currently operate an online rental classified platform named ECrent.com, which provides a marketplace for individuals and companies to view, list and search for rental products and services. Our mission is to become the largest, most extensive sharing economy network, allowing individuals and companies to view, list and search for rental products and services on the platform, creating the conditions for collaborative consumption. Collaborative consumption is the trigger for more sustainable business and consumer practices that will protect the planet s well-being as well as generate an entire class of new business opportunities based on the sharing economy ecosystem. Our model is designed to bring sustainability, entrepreneurship and sharing together. We operate an online platform, www.ecrent.com, which connects owners (businesses and individuals) and consumers in a robust growing community. The platform consists of a set of web portals and mobile applications which facilitate the online search for a wide and expanding range of rental products and services. The ECrent platform is designed to enable members of the rapidly growing global community to seek and rent items everywhere worldwide. The highly scalable ECrent platform is designed to consolidate all sharing and rental information (supply side) from all geographies into one single source, across multiple categories, and then rebroadcast available rental supply to the demand side. The ECrent platform is coded using advanced algorithms which leverage the central database to provide greater convenience to users through an intelligent matching system. The intelligent matching system incorporates specific product and/or service criteria, product/service pairings, geography and browsing behaviors. ECrent believes these features form the basis for a more comprehensive and extensive user experience than is otherwise available from well-known, first generation, single purpose sharing economy businesses such as Uber and Airbnb. After proof of concept by our ECrent Worldwide operating subsidiary in other markets, notably Asia and selected regions of Europe, we started operations in the United States in mid-spring 2016 after obtaining a license to use our ECrent Worldwide s software and trademark. Among the most significant findings, we learned that companies across all segments covet highly targeted and active markets, which historically were believed to generate a greater rate of investment. We believe the demand side is and will be dominated by environmentally and socially conscious users, which will be considered a targeted and active market that will make the platform more attractive and valuable. PwC s accompanying survey showed that 44% of U.S. adults are familiar with the sharing economy; 18% of U.S. adults say they have participated in the sharing economy as a consumer; and 7% say they have participated as a provider. Based on the PwC research, the global sharing and rental market would generate a potential revenue opportunity worth a total of $670 billion by 2025. We believe ECrent is uniquely positioned to capitalize on these trends, and the groundwork has laid in the course of the soft launch will help to achieve the goal to lead the sharing economy development. While the traditional purchase-based consumer discretionary companies have mostly utilitarian relationships with their customers, sharing economy participants are passionate about social responsibility, environmentalism and are committed to leading more sustainable lives. This commitment, fortified by continued momentum, will allow us to build a more captive, engaged, true community of users. The ECrent extensive and scalable platform is engineered to serve the business-to-business, business-to-consumer, and consumer-to-consumer market segments. By covering across these multiple segments positions ECrent for balanced growth regardless of macro-economic conditions as we will not rely on a single market. We envision the strategy will also provide us with ample opportunity to further lead the market by regularly introducing new features, functions, categories, and pricing. 2 We believe businesses will find the ECrent platform highly appealing because it will allow them to monetize unused or little used assets as well as expand their business by opening up new channels created by the sharing economy. In addition, we believe their affiliation with us will allow these companies to reinforce their brand to consumers and investors. A study published by MIT Sloan Management Review and Boston Consulting Group in May 2016 (the MIT BCG Study ) found that 60% of investment firm board members are willing to divest from companies with poor sustainability performance and 75% feel increased operational efficiency often accompanies sustainability progress. By contrast, this same study revealed that only 60% of the 3,000 executives and managers surveyed have a sustainability strategy in place, while only 25% can present a clear sustainability business case. We believe the ECrent platform will be a highly cost-effective vehicle for closing this significant gap between companies and the markets they serve as well as their investors on the basis that our fully branded microsite will provide a cost-effective vehicle for them to develop and implement improved sustainability performance to meet the needs of sustainability conscious investors, notably building awareness and focus on tangible and measurable sustainability (business) outcomes. The ECrent revenue model is to charge only the supply side; demand side registrants are not subject to any fee in the present model. Businesses or individuals can either pay to post a single item or service just as they would for a classified ad or they can post an unlimited number of items as well as brand themselves through an online rental store (microsite) on the ECrent platform. Microsites represent a recurring revenue model, offering a value proposition beyond renting items to other businesses or individuals. The MIT/BCG Study included steps business leaders could take to meet the needs of sustainability-conscious investors, notably building greater awareness and focus on tangible and measurable sustainability (business) outcomes. We believe the ECrent platform will be an ideal cost-effective vehicle for meeting these objectives. The ECrent business is an emerging company in an emerging field. Accordingly, the approach to the market seeks to exploit early market entry opportunities in the sharing economy with a sense-and-respond strategy within our growing community. In the second fully operational phase we will employ both in-house sales professionals and engage market channel partners to solicit business from supply side. We will also build a team of Community Relations specialists who will cultivate tight relationships with users for by soliciting user feedback for ongoing improvements to the platform and expansion. We believe aggressive marketing and strategic partnerships with various agencies, such as marketing firms and trade associations will further propel our business once fully operational. Revenue and User Model ECrent revenue will be derived from online item postings. We do not charge any fees based on transaction value nor do we plan to do so in the near future. Set forth below is the current listing fee arrangements, which fees are to be paid prior to posting: 1. A monthly fee of HK$50,000 for the advertisement posting (unlimited basis); and 2. Online rental stores, or microsite for $2,500 per year. The microsite is an enhanced online advertising package that allows for unlimited number of postings for a defined period of time, and a personalized online web storefront, providing customers with unique branding opportunities. We believe our microsites will represent a recurring revenue model as it will not be cost effective for the users to terminate our services once they have expended efforts to design and promote their microsites and they have received reoccurring traffic from their customers. At this time, our sole source of revenue is the sale of advertising services. Intellectual Property We develop and own all intellectual properties and knowhow to develop and operate the whole ECrent.com platform. Employees As of September 30, 2022, we had two full-time employees and several consultants who are engaged with us either individually or as a business entity. Properties Our executive offices are located at No. 85 Castle Peak Road, Castle Peak Bay, Tuen Mun, N.T., Hong Kong, China. Our telephone number is +852 3583-2186. We do not own any real estate or other physical properties. 3 Smaller Reporting Company We are a smaller reporting company, meaning that we are not an investment company, an asset-backed issuer, or a majority-owned subsidiary of a parent company that is not a smaller reporting company and have (i) a public float of less than $250 million or (ii) annual revenues of less than $100 million during the most recently completed fiscal year and no public float, or a public float of less than $700 million. As a smaller reporting company, the disclosure we will be required to provide in our SEC filings is less than it would be if we were not considered a smaller reporting company. Specifically, smaller reporting companies are able to provide simplified executive compensation disclosures in their filings; are exempt from the provisions of Section 404(b) of the Sarbanes-Oxley Act of 2002 requiring that independent registered public accounting firms provide an attestation report on the effectiveness of internal control over financial reporting; are not required to conduct say-on-pay and frequency votes until annual meetings; and have certain other decreased disclosure obligations in their SEC filings, including, among other things, being permitted to provide two years of audited financial statements in annual reports rather than three years. Scaled disclosures in our SEC filings due to our status as a smaller reporting company may make it harder for investors to analyze the Company s results of operations and financial prospects. Emerging Growth Company We are also an emerging growth company within the meaning of the federal securities laws. For as long as we are an emerging growth company, we will not be required to comply with the requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, the reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and the exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We intend to take advantage of these reporting exemptions until we are no longer an emerging growth company. Our fiscal year end is December 31. Our audited financial statements for the quarter ended September 30, 2022, were prepared assuming that we will continue our operations as a going concern. Our accumulated loss for the period ended September 30, 2022 was $80,589,081. For the three months ended September 30, 2022, we earned revenues of $69,947, with the cost of such revenues being $0. Due to the uncertainty of our ability to meet our current operating and capital expenses, our independent auditors have included a going concern opinion in their report on our audited financial statements for the period ended December 31, 2021. The notes to our financial statements contain additional disclosure describing the circumstances leading to the issuance of a going concern opinion by our auditors. 4 THE OFFERING Common Stock offered by Selling Security Holder: This prospectus relates to the resale of 2,000,000,000 shares of our common stock, issuable to the Selling Security Holder. Common Stock outstanding before the Offering: 333,331,882 shares of common stock as of the date of this prospectus. Common Stock outstanding after the Offering: 2,333,331,882 shares of common stock (1) Terms of the Offering: The Selling Security Holder will determine when and how it will sell the common stock offered in this prospectus. The prices at which the Selling Security Holder may sell the shares of common stock in this offering will be determined by the prevailing market price for the shares of common stock or in negotiated transactions. Termination of the Offering The Offering will conclude upon such time as all of the common stock has been sold pursuant to the registration statement. Trading Market Our Common Stock is subject to quotation on the OTCQB Market under the symbol SEII. Use of proceeds The Company is not selling any shares of the common stock covered by this prospectus. As such, we will not receive any of the offering proceeds from the registration of the shares of common stock covered by this prospectus. See Use of Proceeds. Risk Factors The common stock offered hereby involves a high degree of risk and should not be purchased by investors who cannot afford the loss of
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0000825322_mphase_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0000825322_mphase_prospectus_summary.txt
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+74 MPHASE TECHNOLOGIES, INC. INDEX TO FINANCIAL STATEMENTS Report of Independent Registered Public Accounting Firm F-2 Consolidated Balance Sheets as of June 30, 2021 and 2020 F-3 Consolidated Statements of Operations for the Years Ended June 30, 2021 and 2020 F-4 Consolidated Statements of Changes in Stockholders Equity for the Years Ended June 30, 2021 and 2020 F-5 Consolidated Statements of Cash Flows for the Years Ended June 30, 2021 and 2020 F-6 Notes to Consolidated Financial Statements for the Years Ended June 30, 2021 and 2020 F-8 - F-41 Consolidated Balance Sheets as of December 31, 2021 (unaudited) and June 30, 2021 (audited) F-42 Consolidated Statements of Operations and Other Comprehensive Income (Loss) for the Three and Six Months Ended December 31, 2021 and 2020 (unaudited) F-43 Consolidated Statements of Changes in Stockholders Equity for the Six Months Ended December 31, 2021 and 2020 (unaudited) F-44 Consolidated Statements of Cash Flows for the Six Months Ended December 31, 2021 and 2020 (unaudited) F-45 Notes to Condensed Consolidated Financial Statements for the Six Months Ended December 31, 2021 and 2020 (unaudited) F-47 - F-69 F-1 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and Board of Directors of mPhase Technologies, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of mPhase Technologies, Inc. (the Company ) as of June 30, 2021 and 2020, the related consolidated statements of operations and other comprehensive income (loss), changes in stockholders equity, and cash flows for each of the two-years in the period ended June 30, 2021, and the related notes (collectively referred to as the financial statements ). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of June 30, 2021 and 2020, and the results of its operations and its cash flows for each of the two years in the period ended June 30, 2021, in conformity with accounting principles generally accepted in the United States of America. Basis of Opinion These financial statements are the responsibility of the Company s management. Our responsibility is to express an opinion on the Company s financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ( PCAOB ) and are required to be independent with respect to the Company in accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to fraud or error. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company s internal control over financial reporting. Accordingly, we express no such opinion. Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion. Critical Audit Matters The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Going Concern Considerations As discussed in Note 2 to the financial statements, the financial statements were prepared on a going concern basis, which contemplated the realization of assets and the satisfaction of liabilities in the normal course of business. At June 30, 2020, conditions existed which raised substantial doubt about an entity s ability to continue as a going concern. At June 30, 2021, this uncertainty was alleviated by Management s plans, including the Company s existing working capital, current net income and expected future cash flows. Auditing management s evaluation of a going concern can be a significant judgment given the fact that the Company uses management estimates on future revenues and expenses which are not able to be substantiated. To evaluate the appropriateness of the mitigation of the going concern uncertainty, we examined and evaluated the financial information that was the initial cause along with managements plans to mitigate the going concern and managements disclosure of going concern. /s/ Boyle CPA, LLC We have served as the Company s auditor since 2020 Red Bank, NJ October 13, 2021 331 Newman Springs Road P (732) 784-1582 Building 1, 4th Floor, Suite 143 F (732) 510-0665 Red Bank, NJ 07701 F-2 mPHASE TECHNOLOGIES, INC. CONSOLIDATED BALANCE SHEETS June 30, 2021 June 30, 2020 Assets Current Assets Cash $2,473,386 $142,413 Accounts receivable, net 15,784,081 14,048,095 Prepaid expenses 238,927 4,477 Other assets 422,254 30,879 Total Current Assets 18,918,648 14,225,864 Property and equipment, net 16,518 32,669 Goodwill 3,669 3,636 Intangible asset - purchased software, net 2,079,047 2,835,117 Other assets 3,645 11,670 Total Assets $21,021,527 $17,108,956 Liabilities and Stockholders Equity Current Liabilities Accounts payable $4,158,006 $7,897,887 Accrued expenses 1,368,367 1,123,842 Contract liabilities 350,689 219,652 Due to related parties 87,688 84,485 Note payable to officer 691,942 26,818 Notes payable 323,218 20,469 Convertible notes payable, net 1,991,036 189,641 Current portion, liabilities in arrears with convertible features 109,000 109,000 Current portion, liabilities in arrears - judgment settlement agreement (Note 9) - 771,702 Derivative liability - 897,631 Liabilities of discontinued operations 82,795 82,795 Total Current Liabilities 9,162,741 11,423,922 Notes payable, net of current portion 146,890 167,459 Total Liabilities 9,309,631 11,591,381 Commitments and Contingencies (Note 15) Stockholders Equity Preferred stock, $0.01 par value; 1,000 shares authorized and 1,000 shares issued and outstanding at June 30, 2021 and 2020 10 10 Common stock, $0.01 par value; 500,000,000 shares authorized and 78,612,608 shares issued and 78,584,238 outstanding at June 30, 2021, and 19,318,679 shares issued and 19,174,492 outstanding at June 30, 2020 785,844 191,745 Additional paid-in-capital 236,935,277 231,984,704 Common stock to be issued 63,700 955,466 Accumulated other comprehensive (loss) income (11,526) 113,070 Accumulated deficit (226,061,409) (227,727,420) Total Stockholders Equity 11,711,896 5,517,575 Total Liabilities and Stockholders Equity $21,021,527 $17,108,956 The accompanying notes are an integral part of these consolidated financial statements. F-3 mPHASE TECHNOLOGIES, INC. CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE INCOME (LOSS) 2021 2020 For the Years Ended June 30, 2021 2020 Revenue $30,672,314 $30,276,422 Cost of revenue 22,501,496 22,579,544 Gross Profit 8,170,818 7,696,878 Operating Expenses: Software development costs 2,433,071 991,928 Salaries and benefits 1,138,735 17,585,981 General and administrative expenses 1,393,104 1,695,200 Total Operating Expenses 4,964,910 20,273,109 Operating income (loss) 3,205,908 (12,576,231) Other Income (Expense): Interest expense (683,544) (219,589) Gain on change in fair value of derivative liability 3,267,323 1,584,102 Initial derivative expense (2,240,908) (1,610,913) Amortization of debt discounts, deferred financing costs, and original issue discounts (2,032,516) (899,491) Gain (loss) on extinguishment and settlement of debt 149,748 (363,319) Loss on asset disposal - (8,126) Total Other Income (Expense) (1,539,897) (1,517,336) Income (loss) before income taxes 1,666,011 (14,093,567) Income taxes - - Net income (loss) $1,666,011 $(14,093,567) Other comprehensive income (loss): Unrealized (loss) gain on foreign currency translation adjustment (124,596) 113,070 Comprehensive income (loss) $1,541,415 $(13,980,497) Income (loss) per common share: Income (loss) per common share basic and diluted $0.02 $(1.08) Weighted average shares outstanding basic and diluted 73,133,533 13,052,590 The accompanying notes are an integral part of these consolidated financial statements. F-4 mPHASE TECHNOLOGIES, INC. CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY FOR THE YEARS ENDED JUNE 30, 2021 AND 2020 Shares $0.01 Par Value Shares $0.01 Par Value Paid in Capital to be Issued Comprehensive Loss Accumulated Deficit Stockholders Equity Preferred Stock Common Stock Additional Common Stock Other Total Shares $0.01 Par Value Shares $0.01 Par Value Paid in Capital to be Issued Comprehensive Loss Accumulated Deficit Stockholders Equity Balance June 30, 2019 1,000 $10 11,689,078 $116,890 $214,007,203 $115,388 $- $(213,633,853) $605,638 Issuance of Common Stock to accredited investors in private placements 1,129,577 11,296 368,704 (33,000) 347,000 Common Stock to be issued for CloseComms transaction 955,466 955,466 Issuance of Common Stock for conversions of convertible promissory notes - 5,872,362 58,724 995,480 - 1,054,204 Issuance of Common Stock for exchange of warrants Issuance of common stock for exchange of warrants, shares Issuance of Common Stock for CloseComms acquisition Issuance of common stock for CloseComms acquisition, shares Issuance of Common Stock for vendor services Issuance of Common Stock for vendor services, shares Issuance of Common Stock for note payable issuance Issuance of common stock for note payable issuance, shares Stock-based compensation for restricted shares under employment agreements Stock-based compensation for restricted shares under employment agreements, shares Cancellation of Common Stock of CEO Cancellation of Common Stock of CEO, shares Relative fair value of warrants issued with convertible promissory notes Issuance of Common Stock for the conversion of Related Party debts and Strategic Vendor payables, net of reversals - 294,654 2,947 216,570 (82,388) - 137,129 Issuance of Common Stock for accrued services 62,000 620 45,880 46,500 Issuance of Common Stock for services related to private placements 11,003 110 (110) - Restricted shares issued under employment contract 115,818 1,158 148,448 149,606 Warrants earned under employment contract 16,202,529 16,202,529 Other comprehensive income 113,070 113,070 Net loss (14,093,567) (14,093,567) Balance June 30, 2020 1,000 $10 19,174,492 $191,745 $231,984,704 $955,466 $113,070 $(227,727,420) $5,517,575 Issuance of Common Stock for conversions of convertible promissory notes 20,716,750 207,169 1,389,719 1,596,888 Issuance of Common Stock for exchange of warrants 37,390,452 373,905 (220,604) 153,301 Issuance of Common Stock for CloseComms acquisition 2,666,666 26,667 928,799 (955,466) - Issuance of Common Stock for vendor services 1,422,127 14,221 183,146 63,700 261,067 Issuance of Common Stock for note payable issuance 450,000 4,500 117,000 121,500 Stock-based compensation for restricted shares under employment agreements 115.817 1,158 (32,395) (31,237) Cancellation of Common Stock of CEO - (3,352,066) (33,521) (462,585) - (496,106) Relative fair value of warrants issued with convertible promissory notes 3,047,493 3,047,493 Other comprehensive loss (124,596) (124,596) Net income - 1,666,011 1,666,011 Balance June 30, 2021 1,000 $10 78,584,238 $785,844 $236,935,277 $63,700 $(11,526) $(226,061,409) $11,711,896 The accompanying notes are an integral part of these consolidated financial statements. F-5 mPHASE TECHNOLOGIES, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS 2021 2020 For the Years Ended June 30, 2021 2020 Cash flows from operating activities: Net income (loss) $1,666,011 $(14,093,567) Adjustments to reconcile net income (loss) to net cash from operating activities: Initial derivative expense 2,240,908 1,610,913 Amortization of debt discount, deferred financing costs, and original issue discount 2,032,516 899,491 Depreciation and amortization 925,037 929,924 Stock-based compensation 383,131 16,335,671 (Gain) loss on extinguishment and settlement of debt (149,748) 363,319 (Gain) loss on change in fair value of derivative liability (3,267,323) (1,584,102) Allowance for foreign taxes - 145,129 Loss on asset disposal - 8,126 Changes in operating assets and liabilities: Increase in accounts receivable (27,985,986) (11,521,940) (Increase) decrease in prepaid expenses (180,450) 4,343 Increase in other assets (383,350) (39,491) Increase in contract liabilities 131,037 219,652 Increase in accounts payable and accrued expenses 23,067,514 5,378,498 Net cash used in operating activities (1,520,703) (1,344,033) Cash flows from investing activities: Capital expenditures (3,064) (553) Cash acquired in CloseComms asset acquisition - 70,000 Net cash (used in) provided by investing activities (3,064) 69,447 Cash flows from financing activities: Proceeds from issuance of convertible notes payable, net 5,219,431 1,116,800 Proceeds from notes payable 288,000 187,333 Proceeds from sale of common stock, net of finder s fees - 347,000 Proceeds from notes payable to related parties - 32,800 Repayments of notes payable to related parties (224,595) (32,000) Repayments under settlement agreement (250,000) (120,000) Repayments of convertible notes payable (1,053,500) (262,000) Net cash provided by financing activities 3,979,336 1,269,933 Effect of foreign exchange rate changes on cash (124,596) 113,070 Net increase in cash 2,330,973 108,417 Cash at beginning of year 142,413 33,996 Cash at end of year $2,473,386 $142,413 Supplemental disclosure of cash flow information: Cash paid for interest $514,176 $118,596 Cash paid for taxes $- $- The accompanying notes are an integral part of these consolidated financial statements. F-6 For the Years Ended June 30, 2021 2020 Supplemental disclosure of non-cash operating activities: Initial fair value of derivative liability recorded as debt discount $853,800 $1,115,000 Supplemental disclosure of non-cash investing and financing activities: Relative fair value of warrants issued with convertible promissory notes $3,047,493 $- Issuance of Common Stock for conversions of convertible promissory notes and accrued interest Value $1,596,888 $1,054,204 Shares 20,716,750 5,872,362 Cancellation of Common Stock of Chief Executive Officer Value $496,106 $- Shares 3,352,066 - Issuance of Common Stock for note payable issuance Value $121,500 $- Shares 450,000 - Issuance of Common Stock for vendor services Value $197,367 $46,500 Shares 1,422,127 62,000 Payment of vendor payables by former officer related party $- $15,252 Reversal of Common Stock to be issued for the conversion of strategic vendor payables $- $8,725 Common Stock to be issued for CloseComms asset acquisition Value $- $955,466 Shares - 2,666,666 Issuance of Common Stock for the conversion of Related Party debts and Strategic Vendor payables Value $- $219,517 Shares - 294,654 Issuance of Common Stock for services related to private placements Value $- $11,250 Shares - 11,003 The accompanying notes are an integral part of these consolidated financial statements. F-7 mPHASE TECHNOLOGIES, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2021 AND 2020 NOTE 1: ORGANIZATION AND NATURE OF BUSINESS NATURE OF BUSINESS AND BASIS OF PRESENTATION Organization and Nature of Business Today, mPhase is an EV Charging company with over four decades of experience, technology and a team working to enhance the existing business lines through the integration of cloud-based systems and to deliver software as a service ( SaaS ) and technology as a service ( TaaS ). The focus of our business and central to our success is the full build out and deployment of our mPower EV Charging Network and Consumer Engagement Platform under our mPower ecosystem. As we work to grow the mPower ecosystem, we seek to tailor it to each individual s tastes and needs, with particular emphasis on empowering today s green consumer. We are working to build, grow and expand quickly our unique mPower ecosystem globally, as our technology and services give us a competitive advantage over our competition. Our vision of the mPower ecosystem will consist of the following products and services offered through the mPower application ( mPower App ): (1) mPower EV Charging Network and (2) Consumer Engagement Platform. The goal is to leverage our mPower ecosystem to allow for other businesses and third parties such as retailers and service providers to partner with us in order to utilize our ecosystem (i.e. data, locations, consumers), which in return will create further contracted revenue for mPhase. Branded under the mPower name, we are taking our EV Charging Network offering and combining it with the Consumer Engagement Platform and creating a circular ecosystem where people shop, dine, fuel and interact with the world to create a richer life experience, all through our mPower App. F-8 mPHASE TECHNOLOGIES, INC. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30, 2021 AND 2020 Impact of COVID-19 Pandemic A novel strain of coronavirus, COVID-19, surfaced during December 2019 and has spread around the world, including to the United States. During March 2020, COVID-19 was declared a pandemic by the World Health Organization. During certain periods of the pandemic thus far, a number of U.S. states and various countries throughout the world had been under governmental orders requiring that all workers remain at home unless their work was critical, essential, or life-sustaining. As a result of these governmental orders, the Company temporarily closed its domestic and international offices and required all of its employees to work remotely. As economic activity has begun and continues recovering, the impact of the COVID-19 pandemic on our business has been more reflective of greater economic and marketplace dynamics. Furthermore, in light of variant strains of the virus that have emerged, the COVID-19 pandemic could once again impact our operations and the operations of our customers and vendors as a result of quarantines, illnesses, and travel restrictions. The full impact of the COVID-19 pandemic on the Company s financial condition and results of operations will depend on future developments, such as the ultimate duration and scope of the pandemic, its impact on the Company s employees, customers, and vendors, in addition to how quickly normal economic conditions and operations resume and whether the pandemic impacts other risks disclosed in Item 1A
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that may be important to you. Because it is only a summary, it does not contain all of the information that you should consider before investing in our securities and it is qualified in its entirety by, and should be read in conjunction with, the more detailed information appearing elsewhere in this prospectus and the documents incorporated by reference, including the section titled Risk Factors and our financial statements and the related notes in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021. Overview We design, develop, manufacture and market a platform medical technology, which we refer to as Cryogen-cooled Monopolar Radiofrequency, or CMRF. Our proprietary CMRF technology is delivered through a radiofrequency generator, handpiece and treatment tip that, collectively, we refer to as the Viveve System. The Viveve System is currently being marketed around the world (outside of the United States) for the non-invasive treatment of vaginal introital laxity, sexual function, vaginal rejuvenation, and stress urinary incontinence, or SUI, depending on the relevant country-specific clearance or approval, which we refer to as the Viveve treatment. At this time, the Viveve System is indicated for use, and being marketed for use, in general surgical procedures for electrocoagulation and hemostasis in the United States; the device has not been cleared or approved for use for the treatment of vaginal laxity, to improve sexual function, for vaginal rejuvenation, or for SUI in the United States. Accordingly, the Company is prohibited under current U.S. laws and regulations from promoting it to physicians or consumers for these unapproved uses. We believe the Viveve System and Viveve treatment provide a number of benefits for physicians and patients, including: a safe, minimally-invasive, non-ablative procedure; requiring only a single treatment; compelling physician economics; and ease of use. (16) Incorporated by reference to the Registrant s Current Report on Form 8-K filed with the SEC on February 3, 2017. (17) Incorporated by reference to the Registrant s Current Report on Form 8-K filed with the SEC on May 24, 2017. (18) Incorporated by reference to the Registrant s Quarterly Report on Form 10-Q, filed with the SEC on November 8, 2017. (19) Incorporated by reference to the Registrant s Current Report on Form 8-K filed with the SEC on December 14, 2017. (20) Incorporated by reference to the Registrant s Proxy Statement on Schedule 14A filed with the SEC on August 19, 2019. (21) Incorporated by reference to the Registrant s Proxy Statement on Schedule 14A filed with the SEC on July 7, 2017. (22) Incorporated by reference to the Registrant's Annual Report on Form 10-K filed with the SEC on February 16, 2017. (23) Incorporated by reference to the Registrant s Current Report on Form 8-K filed with the SEC on May 17, 2018. (24) Incorporated by reference to the Registrant s Quarterly Report on Form 10-Q filed with the SEC on August 9, 2018. (25) Incorporated by reference to the Registrant s Quarterly Report on Form 8-K filed with the SEC on December 4, 2018. (26) Incorporated by reference from the Form S-1/A filed with the SEC on November 13, 2019. (28) Incorporated by reference to the Registrant's Annual Report on Form 10-K filed with the SEC on March 16, 2018. (29) Incorporated by reference to the Registrant's Current Report on Form 8-K filed with the SEC on April 17, 2020. (30) Incorporated by reference to the Registrant's Current Report on Form 8-K filed with the SEC on April 24, 2020. (31) Incorporated by reference to the Registrant's Current Report on Form 8-K filed with the SEC on June 10, 2020. (32) Incorporated by reference from the Form 10-K filed with the SEC on March 19, 2020. (33) Incorporated by reference from the Form 8-K filed with the SEC on December 1, 2020. (34) Incorporated by reference from the Form 8-K filed with the SEC on December 17, 2020. (35) Incorporated by reference to the Registrant's Registration Statement on Form S-1 filed with the SEC on January 12, 2021. (36) Incorporated by reference to the Registrant s Annual Report on Form 10-K filed with the SEC on March 18, 2021. (37) Incorporated by reference to the Registrant's Current Report on Form 8-K filed with the SEC on March 31, 2021. (38) Incorporated by reference from the Form 8-K filed with the Securities and Exchange Commission on June 16, 2021. (39) Incorporated by reference from the Form 8-K filed with the Securities and Exchange Commission on January 21, 2022. (40) Incorporated by reference from the Form 10-K filed with the Securities and Exchange Commission on March 17, 2022. (b) Financial statement schedule. None. Item 17. Undertakings. (a) The undersigned registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: Currently, the Viveve System is cleared for marketing in 48 countries throughout the world under the following indications for use: Indication for Use No. of Countries General surgical procedures for electrocoagulation and hemostasis 3 (including the United States) General surgical procedures for electrocoagulation and hemostasis of vaginal tissue and the treatment of vaginal laxity 29 For treatment of vaginal laxity 5 For treatment of the vaginal introitus, after vaginal childbirth, to improve sexual function 9 General surgical procedures for electrocoagulation and hemostasis and for the treatment of vaginal laxity 1 For treatment of vaginal laxity, urinary incontinence and sexual function 1 As of September 30, 2022, we have a global installed base of 915 Viveve Systems and we have sold approximately 69,500 single-use treatment tips worldwide. Because the net revenues we have earned to date have not been sufficient to support our operations, we have relied on sales of our common stock and preferred stock, bank term loans and loans from related parties to fund our operations. The Viveve System consists of three main components: a radiofrequency, or RF, generator housed in a table-top console, a reusable handpiece and a single-use treatment tip. Included with the system are single-use accessories (e.g., return pad, coupling fluid), as well as a cryogen canister that can be used for approximately two to five procedures, and a foot pedal. Physicians or medical practitioners attach the single-use treatment tip to the handpiece, which is connected to the console. The generator authenticates the treatment tip and programs the system for the desired Viveve treatment without further intervention. The treatment is performed in a physician s office and does not require the use of anesthesia. The tissue remodeling effect resulting from the Viveve treatment has been demonstrated by our pre-clinical research. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Our goal is to become the leading provider of non-invasive solutions to treat certain women s intimate health conditions by: Broadening the conditions we treat through robust clinical trials and regulatory label expansion. We are currently pursuing clearance/approval in the United States for the improvement of SUI through our U.S. PURSUIT clinical trial. If the results of the trial are positive, we intend to submit a de novo application for clearance under section 513(f)(2) of the Federal Food, Drug, and Cosmetic Act, or FDCA, to the U.S. Food and Drug Administration, or FDA, as well as seek international regulatory clearances/approvals for this indication, although there are no assurances that we will ever receive such clearances/approvals. Increasing the Number of Installed Bases of Viveve Systems. In our existing markets, we plan to (i) expand the number of Viveve Systems by leveraging our recurring revenue rental model, current and future clinical study results, and through innovative marketing programs directed at both physicians and patients, where permissible by law, and (ii) expand our efforts and obtain regulatory approvals in additional markets, although there are no assurances that we will ever receive such approvals. Driving Increased Treatment Tip Usage. We work collaboratively with our physician customer base to increase treatment tip use for approved indications by enhancing customer awareness and facilitating the marketing efforts of our physician customers to their patients, where permitted by law. We intend to launch innovative marketing programs with physician customers, where permitted by law, to develop a high volume Viveve practice. Developing New Treatment Tips and System Enhancements. We intend to continue to expand our line of treatment tips that, in the future, may allow for shorter procedure times to benefit both physicians and patients. We also plan to pursue potential system modifications and next generation enhancements that will further increase the ease-of-use of the Viveve System. Investing in Intellectual Property and Patent Protection. We will continue to defend and invest in expanding our intellectual property portfolio, and we intend to file for additional patents to strengthen our intellectual property rights. Areas in which we may pursue additional patent protection include, but are not limited to, redesign of certain system components, disposable components and software algorithms with specific improvements and/or additional elements. Market Opportunity - Stress Urinary Incontinence Urinary incontinence, or UI, is the uncontrolled leakage of urine due to the loss of bladder control. Many people live in silence, either because they are embarrassed or because they believe that UI is a normal consequence of aging or having children. Studies suggest that only half of these individuals who consider their UI symptoms to be problematic or bothersome will seek consultation or speak to their doctor. Based on several published studies, we estimate that approximately 28 million women, age 25 to 64 years old, in the United States alone suffer from some form of urinary incontinence. There are multiple types of incontinence, including: SUI, Urge Urinary Incontinence, UUI, and Mixed Incontinence, which is a combination of SUI and UUI. SUI is defined as the uncontrolled leakage of urine due to sudden or increased intraabdominal pressure caused by activities such as exercising, sneezing, laughing, or coughing. There are two main causes of SUI: urethral hypermobility and intrinsic sphincter deficiency, or ISD. Urethral hypermobility is the predominant cause of SUI and is due to weakness in the pelvic floor musculature and soft tissues that cannot stabilize the urethra causing the sphincter muscles to open briefly and leak urine. Based on several published studies, we estimate that pure SUI is common in approximately 5.6 million women in the United States alone and that UUI, which is defined as the sudden urge to urinate with a frequency greater than eight times per 24 hours, is common in approximately 4 million women in the United States. We believe approximately 18 million women in the United States have Mixed Incontinence. AMENDMENT NO.1 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 The first-line treatment options for SUI and UUI begin with lifestyle changes, continence pessaries, and behavioral and physical therapies. However, based on our survey results, conservative treatment options result in low efficacy rates ranging from 40 to 50% in the United States. UUI patients currently have a wide range of pharmacological options to manage the condition, as well as sacral nerve stimulation devices. By contrast, there are limited pharmacologic and non-invasive treatments available for SUI. Patients would have to seek highly invasive procedures such as urethral bulking agents, pelvic floor sling surgery or colposuspension. Based on a 2016 to 2020 data set of the annual patient insurance claims for UI published by Decision Resources Group, approximately 2 million patients had documented conservative therapies and approximately 90,000 patients progress to invasive procedures. We believe a large unmet need remains for SUI patients seeking an effective, non-invasive treatment option. According to one published study, over 80% of urinary incontinent women in the United States who participated in the study were moderately to extremely bothered. However, only 56% of those women ever spoke to a physician about their incontinence. Of the estimated 14.8 million women with predominate SUI, we estimate that approximately 7 million engage in seeking treatment for their condition and for whom a Viveve Treatment may be appropriate. We believe our CMRF technology may offer an alternative to the existing SUI treatment options. By regenerating collagen around the urethra's bladder neck, our treatment may help stabilize the underlying hypermobility of the urethra. Our innovative and proprietary CRMF procedure may also offer potential benefits and competitive advantages that do not currently exist in the non-invasive treatment market for SUI. Our endovaginal approach to regenerating collagen does not require anesthesia or numbing creams. The cryogen cooling feature protects the vaginal mucosa (surface tissue) while allowing the radiofrequency to heat deeper layers of the tissue (lamina propria) and stimulate collagen regrowth. However, there can be no assurance that we will ever receive approval/clearance of our Viveve treatment for SUI in the United States. Clinical Trials and Pre-Clinical Studies PURSUIT - U.S. SUI Trial The Company received FDA approval of its investigational device exemption (IDE) application to conduct its U.S. pivotal, multicenter PURSUIT trial for improvement of SUI in women in July 2020, as well as FDA approval of requested amendments to the IDE protocol in December 2020. Initiation of the PURSUIT trial was announced by the Company on January 21, 2021 and completion of subject enrollment was reported on December 14, 2021. We remain on track to complete patient follow-up visits from our pivotal U.S. PURSUIT clinical trial by the end of the year 2022 and we expect to report topline results shortly thereafter. PURSUIT is a randomized, double-blinded, sham-controlled trial that enrolled 415 subjects with moderate SUI ( 10g 50g urine leakage on the 1-hour Pad Weight Test) at approximately 30 study sites in the United States Randomized in a 2:1 ratio for active and sham treatments, subjects in the active treatment arm received a CMRF treatment (90J/cm2 RF and cryogen-cooling), while subjects in the control arm received an inert sham treatment. The primary efficacy endpoint of the PURSUIT trial is a comparison of the proportion of patients who experience greater than 50% reduction in urine leakage compared to baseline on the standardized 1-hour Pad Weight Test at 12 months post-treatment versus an inert sham procedure. The study also includes several secondary endpoints, including: proportion of patients who experience greater than 50% reduction in urine leakage on the standardized 1-hour Pad Weight Test at three and six months post-treatment, percentage change from baseline in the 1-hour Pad Weight Test at three, six and 12 months, percent of subjects with no incontinence episodes at three, six and 12 months post treatment as assessed with the three-day bladder voiding diary, and change from baseline in the MESA Questionnaire (Medical, Epidemiologic and Social Aspects of Aging), Incontinence Quality of Life (I-QOL), Patient Global Impression of Improvement (PGI-1) Questionnaire, and International Consultation on Incontinence Modular Questionnaire-Urinary Incontinence Short Form (ICIQ-UI-SF) at three, six, nine and 12 months post-treatment. Subject safety will be monitored throughout the study. In-vivo Preclinical Study and Results for New Sham Treatment Tip In response to the inconclusive results, reported in July 2019, from the Company s LIBERATE-International SUI trial conducted in Canada (aimed at supporting SUI indications in Canada, the European Union and several other international countries), Viveve conducted an in-vivo preclinical temperature and immunohistochemistry study to evaluate a new inert sham treatment tip. The Good Laboratory Practices study was initiated in June of 2020 following several months of engineering, validation, and development work. The study assessed both in-vivo tissue temperature changes during treatment, and histopathology at 30 days post-treatment compared to baseline, in three parous ewes using Viveve s CMRF treatment tip (Active), cryogen-cooling only treatment tip ( Old sham treatment used in previous LIBERATE-International SUI study), and a new inert sham treatment tip. Histopathology of vaginal biopsies were performed and included use of -smooth muscle actin, or -SMA, staining for fibroblast activation and formation. All tissue samples were evaluated by an independent and blinded pathologist. VIVEVE MEDICAL, INC. (Exact name of registrant as specified in its charter) The positive preclinical findings demonstrated, as reported in August 2020, that both temperature and immunohistochemistry results support the validity of the new inert sham treatment tip to provide a true inert or placebo treatment. Only minor tissue temperature change (less than 2 degrees centigrade) was generated by the new inert sham treatment tip and no fibroblast activation was shown through elevated a-SMA staining. In contrast, both the Active and cryogen-cooling sham treatment tips demonstrated meaningful tissue temperature changes during treatment and increased fibroblast activation 30 days post-treatment. We believe that the positive in-vivo preclinical study validates our new inert sham treatment tip for use in the U.S. pivotal PURSUIT trial that is currently underway. Three-Arm SUI Feasibility Study In December 2019, the Company received approval of an Investigational Testing Application, or ITA, from the Canadian Ministry of Health and in January 2020 initiated a three-arm, three-month feasibility study to compare Viveve s CMRF treatment and a cryogen-only sham to an inert sham treatment for the improvement of SUI in women. Completion of subject enrollment in the study was reported in March 2020. Study subjects were randomized in a 1:1:1 ratio to the three arms and were assessed using the 1-hour Pad Weight Test, 3-day Voiding Diary, the 24-hour Pad Weight Test and I-QOL at five months post treatment. Due to patient, provider and medical facility health and safety concerns caused by the COVID-19 pandemic, the final subject follow-up visit was changed to 5 months from the initial 3-month design. Final results were reported in August 2020, and showed the primary efficacy endpoint (i.e., change from baseline in the standardized 1-hour Pad Weight Test at five months post treatment) was positively achieved. The median change from baseline in the active CMRF treatment group (N=13) and the cryogen-only sham treatment group (N=12) was -9.5 grams and -6.8 grams respectively, as compared to -4.4 grams in the inert sham treatment group (N=11). The study also assessed several secondary endpoints but showed no differentiation between groups. No device-related safety issues were reported. The meaningful separation demonstrated between the CMRF treatment arm and the inert sham arm in the feasibility study is believed to help provide confidence in the potential to achieve positive separation between the two treatment arms in the ongoing U.S. pivotal PURSUIT trial. 510(k) Clearance from the U.S. Food and Drug Administration In November 2020, we received clearance from the FDA under Section 510(k) that allowed for expanded manufacturing capacity for the consumable treatment tips used with our CMRF technology. The expansion offers a significant reduction in tip manufacturing costs, strengthens our supply chain, reduces manufacturing risk, and positions us to support increases in treatment tip demand and utilization. Recent Developments New Category III CPT Code for SUI Procedure In July 2021, the American Medical Association, or AMA, issued a new Category III Current Procedural Terminology, or CPT , code for the Company s dual-energy procedure effective January 1, 2022. The new Category III CPT code for Viveve s SUI procedure is defined as: endovaginal cryogen-cooled, monopolar radiofrequency remodeling of the tissue surrounding the female bladder neck and proximal urethra for urinary incontinence. The new code establishes a long-term pathway for potential reimbursement for Viveve s noninvasive treatment under evaluation in the PURSUIT trial to improve SUI in women if approved by the FDA for this indication. However, there can be no assurance that we will ever receive such approval/clearance from FDA. Delaware 3841 04-3153858 (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) 345 Inverness Drive South Building B, Suite 250 Englewood, CO 80112 Telephone: (720) 696-8100 (Address, including zip code and telephone number, including area code, of registrant s principal executive offices) Issuance of Patent in Taiwan In June 2022, the Taiwan Intellectual Property Office (TIPO) issued Taiwan Patent No. I766557. The awarded patent further expands and strengthens Viveve's intellectual property portfolio in one of Asia's key markets. Notice of Allowance of Patent Application in United States In August 2022, Viveve received a Notice of Allowance from the United States Patent and Trademark Office (USPTO) for U.S. Patent Application 16/454,578 covering Viveve's treatment to address SUI in women. This patent application issued on November 29, 2022 as U.S. Patent No. 11,511,110. This patent strengthens Viveve's intellectual property portfolio in the United States. Impact of the Coronavirus As of the date of this prospectus, the United States and many other countries continue to face outbreaks or resurgences of the highly transmissible pathogenic coronavirus and its variants, which has resulted in a widespread global health crisis, adversely affected general commercial activity and the economies and financial markets of many countries and may continue to adversely affect our business, financial condition and results of operations. The extent to which the coronavirus impacts us in the future will depend on future developments, which are highly uncertain and cannot be accurately predicted at this time, including new information which may emerge concerning the severity of the coronavirus and the actions to contain the coronavirus or treat its impact, among others. Corporate Information On September 23, 2014, the Company (formerly PLC Systems, Inc.) completed a reverse acquisition and recapitalization pursuant to the terms and conditions of an Agreement and Plan of Merger, or the Merger Agreement, by and among PLC Systems Acquisition Corp., a wholly owned subsidiary of PLC Systems Inc., with and into Viveve, Inc., a Delaware corporation, or the Merger. In conjunction with the Merger, we changed our name from PLC Systems Inc. to Viveve Medical, Inc. to better reflect our new business. We are currently located at 345 Inverness Drive South, Building B, Suite 250, Englewood, Colorado 80112 and our telephone number is (720) 696-8100. Our website can be accessed at www.viveve.com. The information contained on or that may be obtained from our website is not a part of this prospectus. Viveve, Inc. operates as a wholly-owned subsidiary of Viveve Medical and was incorporated in 2005 by Jonathan Parmer, MD, an OBGYN physician. Viveve, is a registered trademark. All other service marks, trademarks and trade names appearing in this prospectus are the property of their respective owners. We do not intend our use or display of other companies trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, these other companies. Summary of Risk Factors Below is a summary of the principal factors that make an investment in our common stock speculative or risky. This summary does not address all of the risks that we face. Additional discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found below under the heading Risk Factors and should be carefully considered, together with other information in this prospectus and our other filings with the SEC before making investment decisions regarding our common stock. o If we fail to maintain regulatory approvals and clearances, or if we are unable to obtain, or experience significant delays in obtaining, FDA clearances or approvals for the Viveve System or any future products we may develop or acquire, including product enhancements, our business and results of operations could be adversely affected. Scott Durbin 345 Inverness Drive South Building B, Suite 250 Englewood, CO 80112 Telephone: (720) 696-8100 (Name, address, including zip code and telephone number, including area code, of agent for service) o Our ongoing U.S. pivotal multicentered clinical trial (PURSUIT) for improvement of SUI in women may produce results that do not result in FDA clearance or approval of our FDA marketing application in the United States for SUI. In the event that we do not obtain FDA clearance or approval of the Viveve System for the treatment of SUI, we will be unable to promote it in the United States for that indication, and the ability to grow our revenue may be adversely affected. o Our marketed products may be used by physicians for indications that are not cleared by the FDA. If the FDA finds that we have marketed our products in a manner that promotes off-label use, we may be subject to government actions, investigations, litigations, or civil or criminal penalties. o Clinical trials necessary to support a 510(k) notification, de novo petition or premarket approval, or PMA, application will be expensive and will require the enrollment of large numbers of patients. Suitable patients may be difficult to identify and recruit. Delays or failures in our clinical trials may prevent us from commercializing our current product or any modified or new products and will adversely affect our business, operating results and prospects. o If the third parties on which we rely to conduct our clinical trials and to assist us with preclinical development do not perform as contractually required or expected, we may not be able to obtain the regulatory clearance or approval which would permit us to commercialize our products. o The results of our clinical trials, including the PURSUIT trial, may not support our proposed safety and efficacy claims or may result in the discovery of adverse side effects. Any of these events could have a material adverse impact on our business. o The Viveve System may, in the future, be subject to product corrections, removals, or recalls that could harm our reputation, business and financial results. o We will need to raise additional funding, which may not be available on acceptable terms, or at all. Failure to obtain this necessary capital when needed may force us to delay, limit or terminate our product development efforts or other operations. o We are dependent upon the success of the Viveve System, which has a limited commercial history. If the device fails to gain or loses market acceptance, our business will suffer. o We compete against companies that have more established products, longer operating histories and greater resources, which may prevent us from achieving significant market penetration or increased operating results. o We have limited data regarding the efficacy of the Viveve procedure. If future data is not positive or consistent with our prior experience, rates of physician adoption will likely be harmed. o We currently have clearance to market the Viveve System in the United States for use in general surgical procedures for electrocoagulation and hemostasis but not for vaginal laxity, sexual function, or SUI. If we want to sell our device and single-use treatment tips in the United States for the treatment of vaginal laxity, sexual function, or SUI, or any indication other than what has been cleared or approved, we will need to obtain additional FDA clearance or approval, which may not be granted. o Our business is not currently profitable, and we may not be able to achieve profitability even if we are able to generate significant revenue. o Our success depends on growing physician adoption of the Viveve System and continued use of treatment tips. o Our revenue may suffer due to our transition of U.S. sales from a capital equipment sales model to a recurring revenue rental model. o We depend on distributors to market and sell the Viveve System internationally. If they are not successful, our marketing and sales efforts will be harmed. o The ongoing COVID-19 pandemic or the future outbreak of other highly infectious or contagious diseases, could seriously harm our research and development, manufacturing and commercialization efforts, increase our costs and expenses and have a material adverse effect on our business, financial condition and results of operations. Copies to: Mitchell S. Bloom, Esq. Shoaib Ghias, Esq. Goodwin Procter LLP Three Embarcadero Center San Francisco, CA 94111 (415) 733-6000 Wendy Grasso, Esq. Reed Smith LLP 599 Lexington Avenue New York, NY 10022 (212) 521-5400 o Competition among providers of devices for the medical device and aesthetics markets is characterized by rapid innovation, and we must continuously innovate technology and develop new products, or our revenue may decline. o We outsource the manufacturing and repair of key elements of the Viveve System to manufacturing partners. o Our manufacturing operations and those of our key manufacturing subcontractors are dependent upon third-party suppliers, making us vulnerable to supply shortages and price fluctuations, which could harm our business. o We rely on a limited number of suppliers and third-party manufacturers, and if they are unable or unwilling to continue to work with us, our business could be materially adversely affected. o We forecast sales to determine requirements for components and materials used in Viveve procedures, and if our forecasts are incorrect, we may experience delays in shipments or increased inventory costs. o Product liability suits could be brought against us due to defective design, labeling, material or workmanship, or misuse of the Viveve System, and could result in expensive and time-consuming litigation, payment of substantial damages and an increase in our insurance rates. o A data breach or cyberattack affecting our devices, information technology systems, or protected data could expose us to regulatory liability and litigation and dilute our brand quality. o We depend on skilled and experienced personnel to operate our business effectively. If we are unable to recruit, hire and retain these employees, our ability to manage and expand our business will be harmed, which would impair our future revenue and profitability. o Our ability to use our net operating losses to offset future taxable income may be subject to certain limitations which could affect our ability to realize tax benefits from our net operating losses. o We have been involved in and may be involved in future costly intellectual property litigation, which could impact our future business and financial performance. o We are a holding company with no business operations of our own and we depend on cash flow from Viveve, Inc. to meet our obligations. o Our shares of common stock are thinly traded, the price may not reflect our value, and there can be no assurance that there will be an active market for our shares of common stock either now or in the future. o We are in non-compliance with Nasdaq's continued listing standards, and if we do not regain compliance we will be delisted from Nasdaq. Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of the registration statement.
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+PROSPECTUS SUMMARY
+ 
+ This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our securities, you should carefully read this entire prospectus, including our financial statements and the related notes and the information set forth under the headings Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations in each case included elsewhere in this prospectus. In this prospectus, unless the context otherwise requires, the terms we, us, our, Metro One Telecommunications, Inc., and Metro One refer to Metro One Telecommunications, Inc., and its consolidated subsidiaries.
+ 
+ Overview
+ 
+ Our Mission
+ 
+ We enable retailers to grow their business, using mobile commerce to better engage their customers, both in-store and online no code required. 
+ 
+ Our President and Chief Executive Officer
+ 
+ Currently our president, Mr. Elchanan Maoz, is also acting as our interim chief executive officer. The Company intends to engage a full-time chief executive officer once the Company has sufficient working capital to justify such expense. 
+ 
+ Location of Business Operations. While we retain a Wyoming registered agent with an address in the United States, specifically at 30 North Gould Street, Suite 2990, Sheridan, WY 82801, we do not maintain an office or conduct operations in the United States, nor do we manage our affairs in Wyoming. Our Wyoming address is primarily to accept service of process and mail forwarding services to the Company s management in Israel. Our business operations are managed and conducted out of our corporate location in Israel, located at Atrium Tower, 18th floor, Zeev Jabotinsky St 2, Ramat Gan, 5250501, Israel. We intend to expand our business operations to the United States in the future, but at this time we do not have definitive dates on which such expansion may occur. 
+ 
+ Our Objective
+ 
+ Metro One Telecommunications, Inc. is focused on changing the way retailers integrate mobile commerce solutions within their business. Our multi-model, plug and play mobile commerce platform enables retailers to launch their own branded mobile application serving as an additional sales channel in a matter of a few hours no code required.
+ 
+ Our recently incorporated Israeli tech company, Stratford, Ltd, merges the functionality of mobile technology, artificial intelligence ( AI ), and Machine learning enabling retailers to quickly and easily bring their business online to significantly:
+ 
+ 
+ Increase customer retention (60%)
+
+ 
+ Increase average basket size (30%)
+
+ 
+ Increase Upsell and Cross-sell x4
+
+ 
+ Increase customers lifetime value CLV dramatic increase in repeat monthly purchases.
+
+ 
+ 
+ 
+ 
+ 1
+ 
+
+ Table of Contents
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+ 
+ 
+ 
+ We have recently completed the transformation of our acquired suite of software products to a fully modular SaaS based platform. This will enable us to scale the company significantly, onboarding multiple retailers simultaneously without any additional integration costs.
+ 
+ 
+
+ 
+ 
+ 
+ It allows retailers to effortlessly build a complete mobile commerce platform from scratch, adding additional features as their business grows and needs advance. A modular stack of technology also enables us to target retailers who has an existing mobile commerce solution as they can merely plug into one our specific features enriching their offering. bile commerce suite, where the retailer can and as their business needs develop.
+ 
+ Principal products
+ 
+ Shelfy provides a mobile commerce platform that enables retailers to build their own branded mobile application in a matter of hours with intuitive drag and drop tools no coding required. Adding mobile as an additional sales channel enables retailers to grow its customer loyalty and its revenues.
+ 
+ 
+ Mobile Commerce Merchant Platform: Enabling SMB retailers to launch a fully branded and functional mobile app with unique and patented features. Great for retailers with at least 200+ return customers. Our patented UX/UI features are available on both IOS and Android and include unique features such as voice search, shoppable videos, and barkers for upselling.
+
+ 
+ 
+
+ 
+ Mobile Commerce Enterprise Platform: Enabling Enterprise retailers who own and operates both brick and mortar store as well as e-commerce platforms to better engage with their customer both online and in-store via the customer s mobile application.
+
+ 
+ 
+
+ 
+ Instore engagement Suite: providing a purely customer-centric approach to shopping. Our Scan, Pay & Go reduces the customer s shopping time by approximately 40%. Imagine no more waiting in lengthy lines, no more time and effort spent on packing, unpacking and packing again and for retailers, an effective way to reduce cost on hardware acquisition and maintenance. Additional instore features will include In-store navigation, in-store personalized shopping experience, and in-store customer loyalty program activation. During this phase, we might consider the M&A of small startups with unique technological features enriching our suite of products without having to develop from scratch.
+
+ 
+ 
+ 
+ 
+ 2
+ 
+
+ Table of Contents
+
+ 
+ 
+ 
+ 
+ Marketing, Sales and Customer Service
+ 
+ Due to the dynamic nature of SaaS platforms and the market sector we are targeting, we have decided to focus on being a product-led company, merge the marketing, sales and customer success teams into one department, providing a complete customer-centric approach. This approach gives us a 360 view of the customer journey and ensures that we can act in real-time to acquire new customers and provide the relevant support when and where needed to retain the customers we have acquired. Using the latest marketing discipline called Product led Growth Hacking and automation we will be able to support and focus on rapid and optimized growth, consisting of both a process and a set of cross-disciplinary (digital) skills. Our goal is to regularly conduct testing that will lead to improving the customer journey and replicate and scale the ideas that work and modify or abandon the ones that don t before spending vast amounts of resources. Once a plan has been validated, it is automated and the system works by itself reducing overheads and lowering the cost of customer acquisition ( CAC ).
+ 
+ 
+ 
+ To ensure we provide retailers the optimal results when using our platform our focus will not merely be on sales cycles but creating a community where they can learn and grow with plenty of engagement and educational information such as blogs, webinars, and affiliation programs.
+ 
+ Competitive Strengths
+ 
+ It is important to emphasize that we are not App developers -hence our direct competitors are not other app developers (which there are plenty of in the market). What we provide is a mobile commerce platform that provides retailers software that enables them (big and small, offline and online) to build their own application without one line of code or any development needed from their side.
+ 
+ We differentiate our products primarily through functional points of difference between our products and those of our competitors, including:
+ 
+ - Intuitive drag and drop dashboards that enable merchants to build their own branded mobile application
+ 
+ - Patented single product display graphical user interface called the shelf that makes mobile shopping truly mobile and is truly unique to our application
+ 
+ - An advanced in-app marketing suite consisting of features such as shoppable videos and barkers, which has been shown to increase up-selling and cross selling threefold and increase product impression by 400%, based on recorded Shelfy performance in the Kruidvat health and beauty chain in the Netherlands versus commonly served retail shopping apps.
+
+ 
+ 
+ 
+ 
+ 3
+ 
+
+ Table of Contents
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+ 
+ 
+ 
+ Market Analysis
+ 
+ With the number of mobile users currently at 5.22 billion and growing, based on a report published by Oberlo, there s nothing to indicate that mobile commerce growth will stop anytime soon. Not only is the number of mobile users increasing, but the total time spent on mobile devices marking a 24.5 percent increase in just five years., Mobile commerce share figures have also been on an upward trend.
+ 
+ We currently have four (4) customers, three (3) of which are currently using our recently launched SaaS mobile commerce app. Our business currently heavily depends on our current customers, and there can be no assurance that we will be able to obtain additional customers, or enough customers to achieve substantial revenue or successfully operate our business. Our market analysis is based on published statistics and reports in the mobile commerce industry, as well as Shelfy s recorded performance based on data collected from a former European client in Belgium and the Netherlands over a period of twelve months, prior to our acquisition of certain assets from Royal App. 
+ 
+ Business Model
+ 
+ We have a purely Business to Business to Customer ("B2B2C") business model. We license our software direct to businesses who in turn sell their goods to the end user, the customer (our end user). We will charge retailers a monthly usage fee using a combination of persona-based and per-feature pricing models, where distinct packages align to a specific type of customer persona based on:
+ 
+ Gross merchandise value (GMV)
+ 
+ market segment
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+ physical/online store presence.
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+ Experienced Leadership Team
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+ The combination of operating skills from our management team with the experience of successfully leading major retail and mobile commerce companies gives our organization a significant strength relative to most small- and medium-sized companies.
+ 
+ Going Concern
+ 
+ Our auditors have expressed, in their report to our audited financial statements for the year ended December 31, 2021, substantial doubt about our ability to continue as a going concern. 
+ 
+ Growth Strategies
+ 
+ Our primary long-term goal is to become one of the market leaders within the Mobile Commerce sector, providing an additional sales channel which merchants and retailers of all sizes can add to their existing business. We intend to achieve this goal by driving organic growth through third-party integrated platforms, across all major retail channels where repeat purchases occur and in all major markets where e-commerce has been adopted and in markets where the use and launch of e-commerce shops are on the rise.
+ 
+ Our key growth strategies include the following:
+ 
+
+ 
+ 
+ developing a powerful, performance-oriented, and metric-driven organizational culture;
+
+ 
+ 
+ 
+
+ 
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+ developing automated marketing, sales and customer service tool kits to empower our sales force network to engage with global customers;
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+ 
+ 
+ 
+
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+ developing brand/marketing tool kits for current and new products and segments, to make onboarding as efficient and seamless as possible;
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+ 
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+ Launching and expanding our SaaS products domestically and internationally;
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+ strengthening our supply chain to achieve best in class costs, on-time/as promised products and customer service;
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+ improving margins with improved efficiency, and improved net revenue per case with new products;
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+ upgrading infrastructure, systems and processes with enterprise resource planning systems, improved financial reporting, operating expense control, and strengthened key metrics and accounting and control procedures; and
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+ strengthening our financial foundation via accessing the capital markets, solidifying long-term banking partners and facilities, and pursuing transformative organic and external growth.
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+ 
+ 
+ 
+ 
+ 4
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+
+ Table of Contents
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+ 
+ 
+ 
+ Recent Developments
+ 
+ On March 30, 2021, the Company announced that its newly-formed, wholly owned Israeli subsidiary, Stratford Ltd. had received notification of approval from the Lod District Court in Israel for its winning bid to acquire certain assets of Royal App, Ltd,. out of insolvency proceedings for approximately $2.4 million USD in cash as well as 8% equity in the Company on a diluted basis, post conversion of the Company s preferred common stock and certain other proposed sales of common stock in order to raise the required funds to complete the acquisition, (the Recapitalization ).
+ 
+ Royal App, Ltd., is the developer of Shelfy, a white label, headless mobile enterprise software platform that helps retailers and fast moving consumer goods companies become growth companies. The Shelfy product incorporates sophisticated artificial intelligence and machine learning in its algorithms to markedly improve online shopping metrics through mobile phones for large consumer retailers such as supermarket chains, food and other clients. Concurrent with the acquisition of the Shelfy software assets, management determined the technological feasibility of proposed enterprise software product modifications, including functions, features, and technical performance requirements to relaunch the software as a SaaS product offering, initially integrated on key reseller platforms, with the intent of repositioning the software with an entirely new and much larger market base. An easy to use, fully customizable mobile commerce app for download by consumers across all industry segments for a base monthly subscription fee, and readily available add on features for additional monthly fees based on individual consumer selections. 
+ 
+ To finance the acquisition as well as general working capital, the Company proposed to raise up to $3.5 million commencing March 2021 in the form of puttable Simple Agreements for Future Equity ( SAFE ) from institutional investors and family offices. The terms of the SAFE require that they automatically convert into common stock of the Company following the conversion of all outstanding convertible preferred stock into common stock. The Company s intent was to undertake the conversion of preferred stock in the quarter ended September 30, 2021, following shareholder approval of certain proposed corporate restructure plans.
+ 
+ Subsequent to the conversion of the preferred stock, and as part of the agreement for the acquisition of certain assets of Royal App, Ltd., the Company also agreed to issue common stock for commission fees of 2% of the Company s common stock on a diluted basis, and to the employees of Stratford as to 8% of the Company on a diluted basis, under the terms of an Employee Stock Option Plan, once approved by Shareholders. Further, in order to undertake these issuances, the Company was required to increase the authorized common stock of the Company.
+ 
+ Prior to our acquisition of certain assets from Royal App, Ltd., by our wholly owned Israeli subsidiary, Stratford Ltd., we were a shell company seeking a project of merit. 
+ 
+ On June 9, 2021, the Company announced a Stockholders meeting to be held on June 30, 2021 to approve the following actions:
+ 
+ 1. An amendment to the articles of the Company to increase the authorized shares of the Company from 50,000,000 to 600,000,000.
+ 
+ 2. An amendment to the articles of the Company to effect a reverse stock split on the basis of not less than 1 for 10 and not more than 1 for 100. Such ratio to be determined by the Board of Directors of the Company at such time as it is approved by the Board of Directors of the Company.
+ 
+ 3. Approval of a 2021 Employee Stock Incentive Plan. The Plan will have available shares equity to 25% of the Company s capitalization and a term of ten years from the effective date of the Plan.
+ 
+ 4. Approval of the Company s reorganization from Oregon to Delaware.
+ 
+ The meeting was held on June 30, 2021, and the Company s shareholders approved all of the actions detailed above, as well as the conversion of 1,000 outstanding shares of Company s Series A convertible preferred stock whereby each 1 share of Preferred stock held is convertible into 71,683.25 shares of common stock. As a result, during the period ended September 30, 2021, the holders of the Company s Series A convertible preferred stock successfully converted their holdings into 71,683,250 shares of Common Stock and the Board issued the remaining securities as agreed under the Acquisition Agreement including 22,647,751 shares to the Trustee as part of the asset acquisition costs and 5,661,938 shares to the agent as financing costs. Further a total of $3.25 million raised in the form of SAFES were converted into a total of 126,614,436 shares of common stock at $0.02567 per share.
+ 
+ Risks
+ 
+ Our business and ability to execute our growth strategies are subject to a number of risks of which you should be aware before you make an investment decision. In particular, you should consider the risks discussed in the Risk Factors section of this prospectus, including, but not limited to, the following:
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+ 5
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+ Table of Contents
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+ we have incurred significant losses to date and may continue to incur losses;
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+ we will need to raise additional capital;
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+ growth of operations will depend on the acceptance of our products and consumer discretionary spending;
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+ we have limited management resources and are dependent on key executives;
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+ failure to achieve and maintain effective internal controls could have a material adverse effect on our business;
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+ competition that we face is varied and strong;
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+ 
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+ We depend on a large volume of merchants and retailers paying us a small monthly usage fee which may mean a high cost of customer acquisition during the first 2-3 years of launching our new SaaS model.
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+ 
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+ 
+
+ 
+ 
+ In the first 4 years from launching our SaaS solution we are dependent on third-party eCommerce platforms such as Shopify to host our software. In the event that one of these platforms becomes redundant or completely changes some of their policies it may have a negative impact on our business and result in loss of business or existing customers
+
+ 
+ 
+ 
+
+ 
+ 
+ failure of third party vendors and platforms upon which we rely could adversely affect our business; and
+
+ 
+ 
+ 
+
+ 
+ 
+ litigation and publicity concerning product quality and other issues could adversely affect our results of operations, business and financial condition;
+
+ 
+ 
+ 
+ 
+ 6
+ 
+
+ Table of Contents
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001076262_golden_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001076262_golden_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..d274be397b155ac8eb24a741ae757ecddcac0eae
--- /dev/null
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@@ -0,0 +1,88 @@
+PROSPECTUS SUMMARY
+ 
+ The following summary highlights selected information contained elsewhere in this prospectus and does not contain all of the information you should consider before investing in our securities. Before deciding to invest in our securities, you should read this entire prospectus, including the discussion of Risk Factors and our consolidated financial statements and the related notes.
+ 
+ Throughout this prospectus, unless otherwise designated or the context suggests otherwise,
+ 
+ 
+ all references to the Company, Golden Star, Enigmai , the registrant, we, our, or us in this prospectus mean Golden Star Enterprises Ltd.., a Delaware corporation, and its wholly owned subsidiary, Enigmai Ltd., an Israel corporate entity. 
+
+ 
+ 
+
+ 
+ year or fiscal year means the Company s fiscal year ending December 31st; and
+
+ 
+ 
+
+ 
+ all dollar or $ references refer to United States dollars, unless otherwise indicated
+
+ 
+ 
+ 
+ Our Company
+ 
+ Our History
+ 
+ On September 13, 1993, we were incorporated as Power Direct, Inc. on January 31, 2000, we effected a name change to 2U Online.com, , and further name changes to Golden Spirit Minerals Ltd. on October 8, 2003, Golden Spirit Mining Ltd. on October 19, 2004, Golden Spirit Gaming Ltd. on July 18, 2005, Golden Spirit Enterprises Ltd. on June 30, 2006, Terralene Fuels Corporation on August 29, 2011, and to Golden Star Enterprises Ltd., which is our current name on June 5, 2013. On October 27, 2020, the Company entered into an acquisition agreement with the shareholders of Enigmai Ltd., an enterprise software company established in 2009 which offers clients a workforce management system solution, whereby the Company acquired 100% of the issued and outstanding shares of Enigmai Ltd in exchange for 22,000,000 restricted common shares of the Company, of which 2,000,000 shares were a finder s fee payment to third parties. The transaction closed effective October 31, 2020, and the Company administratively issued the shares on November 24, 2020, making Enigmai Ltd. a wholly owned subsidiary of the Company. 
+ 
+ Overview
+ 
+ We conduct all of the operations currently through Enigmai, our wholly owned subsidiary based in Israel, which was established in early 2009 and has since developed an advanced workforce management system for scheduled environments. Enigmai helps organizations implement their vision, integrating with existing systems and software. Enigmai offers a visible, detailed, aware organizational system, which considers all relevant factors and provides a service appreciated by both managers and employees (the Enigmai Business Suite ) 
+ 
+ The Enigmai Business Suite software is a fixed fee software every client receives the same version. Customers pay a one-time fee for the Enigmai Business Suite software, and 12% annually for maintenance and support, which maintenance fee may fluctuate dependent on the client, the features requested, the number of seats and the geographical locations . Updates and new versions are included, and we charge a small one time set up fee.
+ 
+ Recent Developments
+ 
+ On January 14, 2022, we entered into a finder s fee agreement with J.H. Darbie & Company ( Darbie ) whereby Darbie provided introduction services to qualified funders for the Company. In consideration for any closing introductions Darbie would receive a finder s fee in cash equal to 8% of the gross proceeds of an equity/convertible debt transaction or 3% of the gross proceeds of a non-convertible debt transaction, plus equity in the form of common stock equal to 8% of the amount raised. We issued a total of 701,053 shares of restricted common stock to Darbie on May 20, 2022, and these shares are not a part of this prospectus offering.
+ 
+ 
+ 7
+ 
+
+ Table of Contents
+
+ 
+ 
+ 
+ On May 20, 2022, we entered into a Securities Purchase Agreement ( SPA ) and Senior Secured Promissory Note with MHFLP, whereby in consideration of $370,000, less $37,000 discount fee; less $26,640 to Darbie pursuant to the finder s fee agreement, and $5,000 for legal expenses, we issued to MHFLP a convertible promissory note ( MHFLP Note ) in the principal amount of $370,000. Further, in conjunction with the MHFLP Note, the Company agreed to issue a series of five-year warrants for the purchase of a cumulative 19,000,000 shares of our Common Stock (the MHFLP SPA Warrants ), all exercisable at $0.04 per share (the MHFLP SPA Warrant Shares ) as a result of the impact an anti-dilution clause whereby if at any time while the warrants are outstanding, the Company shall sell or grant any option to purchase or sell or grant any right to reprice, or otherwise dispose of or issue any common stock or securities priced at less than the exercise price of the warrants, then the Company is obligated to notify the warrant holder and to adjust the warrant exercise price by reducing, at the option of the Holder and only reduced to equal the issuance price or the new issuance such that the number of Warrant Shares issuable shall be increased such that the aggregate Exercise Price payable hereunder, after taking into account the decrease in the Exercise Price, shall be equal to the aggregate Exercise Price prior to such adjustment (for the avoidance of doubt, the aggregate Exercise Price prior to such adjustment is calculated as follows: the total number of Warrant Shares issuable upon exercise of this Warrant immediately prior to such adjustment (without regard to the Beneficial Ownership Limitation) multiplied by the Exercise Price in effect immediately prior to such adjustment). On June 6, 2022, the Company issued shares under a consulting agreement to Beyond priced at $0.04 per share thus triggering a repricing of the share purchase warrants originally issued under the SPA to an exercise price of $0.04 per share.
+ 
+ On May 27, 2022, we entered into a Equity Purchase Agreement with Mast Hill Fund, LP ( MHFLP , or a Selling Stockholder ), pursuant to which, upon the terms and subject to the conditions thereof, MHFLP is committed to purchase, on an unconditional basis, shares of our common stock (the Put Shares ) at an aggregate price of up to $5,000,000 (the Maximum Commitment Amount ) over the course of its term. The term of the Equity Purchase Agreement will end on the earlier of (i) the date on which such Selling Stockholder has purchased Common Stock pursuant to the Equity Purchase Agreement equal to the Maximum Commitment Amount, (ii) two years from the date this Registration Statement is deemed effective, or (iii) written notice of termination by us.
+ 
+ From time to time over the term of the Equity Purchase Agreement, commencing on the date on which a registration statement registering Put Shares becomes effective, we may, in our sole discretion, provide MHFLP with a put notice (each a Put Notice ) to purchase a specified number of Put Shares (each a Put Amount Requested ) subject to the limitations discussed below and contained in the Equity Purchase Agreement. Upon delivery of a Put Notice, we must deliver the Put Amount Requested as Deposit Withdrawal at Custodian (DWAC) shares to Selling Stockholder within five trading days.
+ 
+ The actual amount of proceeds we receive pursuant to each Put Notice (each, the Put Amount ) is determined by multiplying the Put Amount Requested by the applicable purchase price. The purchase price for each of the Put Shares equals 70% of the Market Price, which is defined as the average of the two (2) lowest volume weighted average prices of our Common Stock during the Valuation Period. The Valuation Period is the seven (7) trading days immediately following the date MHFLP receives the Put Shares in its brokerage account.
+ 
+ In order to deliver a Put Notice, certain conditions set forth in the Equity Purchase Agreement must be met. In addition, we are prohibited from delivering a Put Notice if: (i) the sale of Put Shares pursuant to such Put Notice would cause us to issue and sell to Selling Stockholder, or the Selling Stockholder to acquire or purchase, a number of shares of our common stock that, when aggregated with all shares of Common Stock purchased by Selling Stockholder pursuant to all prior Put Notices issued under the Equity Purchase Agreement, would exceed the Maximum Commitment Amount; or (ii) the issuance of the Warrant Shares upon exercise of the Warrants would cause us to issue and sell to Selling Stockholder, or the Selling Stockholder to acquire or purchase, an aggregate number of shares of Common Stock that would result in Selling Stockholder beneficially owning more than 4.99% of the issued and outstanding shares of our common stock (the Beneficial Ownership Limitation ).
+ 
+ In connection with the execution of the Equity Purchase Agreement, we issued a common stock purchase warrant (the MHFLP EPA Warrant ) for the purchase of 10,000,000 shares of our Common Stock (the MHFLP EPA Warrant Shares ) to the Selling Stockholder as a commitment fee. The MHFLP EPA Warrant has a term of five years from the date of issuance and has an exercise price of $0.04 per share. On June 6, 2022, the Company issued shares under a consulting agreement to Beyond priced at $0.04 per share thus triggering a repricing of the share purchase warrants originally issued under the SPA to an exercise price of $0.04 per share. The exercise of the MHFLP EPA Warrant is subject to the Beneficial Ownership Limitation and is exercisable immediately; upon presentation of an exercise notice, the Company is obligated to issue the corresponding number of shares.
+ 
+ 
+ 8
+ 
+
+ Table of Contents
+
+ 
+ 
+ 
+ We also entered into registration rights agreements (the Registration Rights Agreements ) with MHFLP pursuant to which we agreed to file a Registration Statement to register the resale of the Put Shares, and the resale of shares by MHFLP underlying the MHFLP EPA Warrant, as well as the shares underlying the MHFLP Note, the MHFLP SPA Warrants and 4,920,000 shares of common stock issued to MHFLP as a commitment fee, pursuant to the SPA. Pursuant to the Registration Rights Agreements, we agreed to (i) file the Registration Statement within 120 calendar days from the Closing Date, (ii) use reasonable efforts to cause the Registration Statement to be declared effective under the Securities Act of 1933, as amended, as promptly as possible after the filing thereof, and (iii) use its reasonable efforts to keep such Registration Statement continuously effective under the Securities Act until all of the Put Shares have been sold thereunder or pursuant to Rule 144.
+ 
+ On June 6, 2022, the Company entered into a consulting agreement with Beyond Media SEZC ( Beyond ) whereby Beyond will provide consulting and investor relations service to the Company for a period of 12 months. Beyond directed the Company to issue the shares to its principal Michael Kahiri, who was issued a total of 7,500,000 shares of common stock valued at $0.04 per share ($300,000) under the contract on June 6, 2022. 
+ 
+ Corporate Information
+ 
+ Our principal executive offices are located at 2803 Philadelphia Pike, Suite B #565, Claymont, DE 19703. Our telephone number is (888) 680-8033 and our website address is www.goldenstarenterprisesltd.com. The information contained on our website is not part of this prospectus.
+ 
+ 
+ 9
+ 
+
+ Table of Contents
+
+ 
+ 
+ 
+ SUMMARY OF
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001078799_marijuana_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001078799_marijuana_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..861f5fe266bfaa608152e600b8849ea92eebd3f7
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001078799_marijuana_prospectus_summary.txt
@@ -0,0 +1,172 @@
+Prospectus Summary
+ 
+ 5
+
+ 
+ Risk Factors
+ 
+ 22
+
+ 
+ Risks Related to Our Business
+ 
+ 24
+
+ 
+ Risks Related to Our Company
+ 
+ 
+
+ 
+ Risks Related to Our Common Stock
+ 
+ 32
+
+ 
+ Forward-Looking Statements
+ 
+ 41
+
+ 
+ Use of Proceeds
+ 
+ 41
+
+ 
+ Dilution
+ 
+ 41
+
+ 
+ The Offering
+ 
+ 41
+
+ 
+ Selling Stockholders
+ 
+ 42
+
+ 
+ Plan of Distribution
+ 
+ 44
+
+ 
+ Description of Securities
+ 
+ 45
+
+ 
+ Experts and Counsel
+ 
+ 48
+
+ 
+ Interest of Named Experts and Counsel
+ 
+ 48
+
+ 
+ Information with Respect to Our Company
+ 
+ 49
+
+ 
+ Description of Business
+ 
+ 46
+
+ 
+ Legal Proceedings
+ 
+ 69
+
+ 
+ Description
+ of Property
+ 
+ 72
+
+ 
+ Market
+ Price of and Dividends on Our Common Equity and Related Stockholder Matters
+ 
+ 72
+
+ 
+ Financial Statements
+ 
+ F-1
+
+ 
+ Management s Discussion and Analysis of Financial Condition and Results of Operations
+ 
+ 73
+
+ 
+ Change in and Disagreements with Accountants on Accounting and Financial Disclosure
+ 
+ 80
+
+ 
+ Directors and Executive Officers
+ 
+ 80
+
+ 
+ Executive Compensation
+ 
+ 82
+
+ 
+ Security Ownership of Certain Beneficial Owners and Management
+ 
+ 82
+
+ 
+ Where You Can Find More Information
+ 
+ 84
+
+ 
+ 
+
+ 
+
+ 
+
+ 
+
+ 3 
+
+ 
+
+ 
+
+ 
+
+CAUTIONARY STATEMENT REGARDING FORWARD LOOKING
+STATEMENTS
+
+ 
+
+Some of the statements contained or incorporated
+by reference in this prospectus are "forward-looking statements". These statements are based on the current expectations,
+forecasts, and assumptions of our management and are subject to various risks and uncertainties that could cause our actual results to
+differ materially from those expressed or implied by the forward-looking statements. Forward-looking statements are sometimes identified
+by language such as "believe," "may," "could," "estimate," "continue," "anticipate,"
+"intend," "should," "plan," "expect," "appear," "future," "likely,"
+"probably," "suggest," "goal," "potential" and similar expressions and may also include
+references to plans, strategies, objectives, and anticipated future performance as well as other statements that are not strictly historical
+in nature. The risks, uncertainties, and other factors that could cause our actual results to differ materially from those expressed or
+implied in this prospectus include, but are not limited to, those noted under the caption "Risk Factors" beginning on page
+21 of this prospectus. Readers should carefully review this information as well the risks and other uncertainties described in other filings
+we may make after the date of this prospectus with the Securities and Exchange Commission.
+
+ 
+
+Readers are cautioned not to place undue reliance
+on forward-looking statements. They reflect opinions, assumptions, and estimates only as of the date they were made, and we undertake
+no obligation to publicly update or revise any forward-looking statements in this prospectus, whether as a result of new information,
+future events or circumstances, or otherwise.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001080319_elys-bmg_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001080319_elys-bmg_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..55c7abaf566ab69fa7108f433513125f4dc38bc1
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001080319_elys-bmg_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our securities, you should carefully read this entire prospectus, including our financial statements and the related notes and the information set forth under the headings Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations in each case included elsewhere in this prospectus. In this prospectus, unless the context otherwise requires, the terms we, us, our, Elys and the Company refer to Elys Game Technology, Corp. Company Overview We currently provide our business-to-consumer ( B2C ) gaming services in Italy through our subsidiary, Multigioco Srl ( Multigioco ), which operations are carried out via both land-based or online retail gaming licenses regulated by the Agenzia delle Dogane e dei Monopoli ( ADM ) that permits us to distribute leisure betting products such as sports betting, and virtual sports betting products through both physical, land-based retail locations as well as online through our licensed website www.newgioco.it or commercial webskins linked to our licensed website and through mobile devices. Management implemented a consolidation strategy in the Italian market by integrating all B2C operations into Multigioco and allowed the Austria Bookmaker license that was regulated by the Austrian Federal Finance Ministry ( BMF ) to terminate. We also provide bookmaking services in the U.S. market via our recently acquired subsidiary Bookmakers Company US LLC ( USB ) in certain regulated states where we offer business-to-business ( B2B ) bookmaking and platform services to our customers. Our intention is to focus our attention on expanding the U.S. market. We recently began operations in Washington, D.C. through a Class B Managed Service Provider and Class B Operator license to operate a sportsbook within the Grand Central Restaurant and Sportsbook located in the Adams Morgan area of Washington, D.C., and in October 2021 we entered into an agreement with Ocean Casino Resort in Atlantic City and commenced operations in the state of New Jersey in March 2022. Additionally, we provide B2B gaming technology through our Odissea subsidiary which owns and operates a betting software designed with a unique distributed model architecture colloquially named Elys Game Board (the Platform ). The Platform is a fully integrated omni-channel framework that combines centralized technology for updating, servicing and operations with multi-channel functionality to accept all forms of customer payment through the two distribution channels described above. The omni-channel software design is fully integrated with a built in player gaming account management system, built-in sports book and a virtual sports platform through our Virtual Generation subsidiary. The Platform also provides seamless application programming interface integration of third-party supplied products such as online casino, poker, lottery and horse racing and has the capability to incorporate e-sports and daily fantasy sports providers. Management implemented a growth strategy to expand B2B gaming technology operations in the U.S. and is considering further expansion in Canada and Latin American countries in the near future. Our corporate group is based in North America, which includes an executive suite situated in Las Vegas, Nevada and a Canadian office in Toronto, Ontario through which we carry-out corporate activities, handle day-to-day reporting and U.S. development planning, and through which various employees, independent contractors and vendors are engaged. We operate two business segments in the leisure gaming industry and our revenue is derived as follows: 1. Betting establishments Transaction revenue through our offering of leisure betting products to retail customers directly through our online distribution on websites or a betting shop establishment or through third party agents that operate white-label websites and/or land-based retail venues; and 2. Betting platform software and services SaaS based service revenue through providing our Platform and virtual sports products to betting operators. If any of the Securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended, check the following box: If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act Registration Statement number of the earlier effective Registration Statement for the same offering: If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, please check the following box and list the Securities Act Registration Statement number of the earlier effective Registration Statement for the same offering: If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act Registration Statement number of the earlier effective Registration Statement for the same offering: Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated Filer Smaller reporting company Emerging Growth Company If an emerging growth company, indicate by checkmark if the registrant has not elected to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. Summary Risk Factors Our business and our ability to execute our business strategy are subject to a number of risks of which you should be aware of before you decide to buy our securities. These risks include, but are not limited to, the following which you should carefully consider and which are discussed more fully in the Risk Factors section of this prospectus. Risks Related to our Financial Condition Because we have a limited operating history, we may not be able to successfully manage our business. We have incurred substantial losses in the past and it may be difficult to achieve profitability. If we do not have sufficient capital resources to complete acquisitions and manage our operations, our ability to implement our business plan could be adversely affected. If we fail to comply with the rules under Sarbanes-Oxley, or, if we discover additional material weaknesses in our internal control and accounting procedures, our stock price could decline significantly and raising capital could be more difficult. We have material weaknesses and other deficiencies in our internal control and accounting procedures. We expect to continue relying on our discretionary available cash and available bank credit facilities to fund our additional acquisitions or enter into new business opportunities. The effects of the COVID-19 pandemic have strained and negatively impact our businesses and operations. Risks Related to our Business Changes in general economic conditions, geopolitical conditions, domestic and foreign trade policies, monetary policies and other factors beyond our control may adversely impact our business and operating results. USB has had limited operations to date. If we should lose our online or land-based licenses, or if the licenses are not renewed for any reason our business would be materially adversely impacted. Our inability to acquire such additional rights or operators or restrictions from using any licenses associated with such acquired operators, will result in an adverse effect on our operating results. If we are unable to respond to changes in consumer preferences, attract new customers or sell new or additional products, our future revenue and business will be adversely affected. If we fail to acquire, integrate and develop operators and new technologies on favorable economic terms, our future growth and operating results could be adversely affected. If we are unsuccessful in establishing or maintaining relationships with third parties, our business may be adversely impacted. We cannot assure you that any acquisition we complete will result in short-term or long-term benefits to us. A decline in the popularity of our gaming websites or those of our Platform clients will negatively impact our business and risk our future growth. Because our gaming operations are largely concentrated within Italy at present, we are subject to greater risks than a gaming company that is more geographically and internationally diversified. Our current expansion strategy may be difficult to implement because the licensing and certification requirements to operate in the United States is complex and licensing requirements in other countries are currently indeterminable. Our inability to retain such officers and key employees or recruit additional qualified personnel may have a material adverse effect on our business. The information contained in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED DECEMBER 12, 2022 Up to 31,407,035 Units (each Unit contains One Share of Common Stock, One Series A Common Warrant to Purchase [ ] Share of Common Stock and One Series B Common Warrant to Purchase [ ] Share of Common Stock) Up to [ ] Pre-Funded Units (each Pre-Funded Unit contains One Pre-Funded Warrant to Purchase One Share of Common Stock, One Series A Common Warrant to Purchase [ ] Share of Common Stock and One Series B Common Warrant to Purchase [ ] Share of Common Stock) Shares of Common Stock Underlying the Series A Common Warrants and Series B Common Warrants and Shares of Common Stock Underlying the Pre-Funded Warrants We are offering up to 31,407,035 units, each unit consisting of one share of our common stock, one Series A common warrant to purchase [ ] share of our common stock and one Series B common warrant to purchase [ ] share of our common stock (the Series A common warrants and Series B common warrants, collectively, the common warrants), based on an assumed offering price of $0.1592 per share, which is the last reported sale price for our common stock as reported on the Nasdaq Capital Market on December 6, 2022. Each common warrant contained in a unit will have an exercise price per share equal to $ [ ] per share. The Series A common warrants contained in the units will be exercisable immediately and will expire on the five year anniversary of the original issuance date. The Series B common warrants contained in the units will be exercisable beginning on the effective date of our stockholders approval of either an increase in the number of our authorized shares of common stock or a reverse stock split, in either case in an amount sufficient to permit the exercise in full of the Series B common warrants, and will expire on the fifth anniversary of the original issuance date. Notwithstanding the foregoing, we will only issue Series B common warrants as part of the units if we do not have sufficient authorized shares to allow for the issuance of Series A common warrants to purchase
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001100397_ayala_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001100397_ayala_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001100397_ayala_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001169987_htg_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001169987_htg_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..4734d798e916101bc6ea904a15e8eb160e9fadc7
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001169987_htg_prospectus_summary.txt
@@ -0,0 +1 @@
+This summary highlights information contained in other parts of this prospectus or incorporated by reference into this prospectus from our filings with the Securities and Exchange Commission, or SEC, listed in the section of the prospectus entitled Incorporation of Certain Information by Reference. Because it is only a summary, it does not contain all of the information that you should consider before purchasing our securities in this offering and it is qualified in its entirety by, and should be read in conjunction with, the more detailed information appearing elsewhere or incorporated by reference into this prospectus. You should read the entire prospectus, the registration statement of which this prospectus is a part, and the information incorporated by reference herein in their entirety, including the Risk Factors and our financial statements and the related notes incorporated by reference into this prospectus, before purchasing our securities in this offering. Unless the context requires otherwise, references in this prospectus to HTG, we, us and our refer to HTG Molecular Diagnostics, Inc. Overview We are a life sciences company advancing precision medicine through our innovative transcriptome-wide profiling and our advanced medicinal chemistry technology. Building on more than a decade of pioneering innovation, our proprietary HTG EdgeSeq platform technology is the basis for our tech-driven hybrid business model which continues to make our RNA molecular profiling applications more effective, efficient and relevant and serves as the engine behind our platform-based drug discovery process. We believe that our technology provides a differentiated and disruptive approach for more efficient drug discovery, allowing us and our partners to increase efficacy and introduce less toxic therapies into clinical development. Our profiling product and service solutions enable targeted RNA profiling using a small amount of biological sample, in liquid or solid forms. Our menu of HTG EdgeSeq assays, including our HTG Transcriptome Panel ( HTP ), designed to measure approximately 20,000 mRNA targets using our HTG EdgeSeq technology, which applies complimentary next-generation sequencing ( NGS ) tools, enables the generation of gene expression data in a timely manner utilizing our simplified workflow. We seek to leverage key business drivers in molecular profiling for biomarker analysis and diagnostics, including the acceleration of precision medicine, the migration of molecular testing to NGS-based applications, the movement to smaller and less invasive biopsies, the need for greater diagnostic sensitivity, the need to conform to challenging healthcare economics and the need for automation and an easily deployable workflow, including simplified bioinformatics. These capabilities enable customers to extend the use of limited biological samples for retrospective or prospective analysis, gaining further understanding of the molecular drivers of disease with the goal of developing biomarker-driven targeted therapies. Our existing products include instruments, consumables and software that, as an integrated platform, automate sample processing and can quickly, robustly and simultaneously profile hundreds, thousands or tens of thousands of molecular targets from samples which can be a fraction of the size required by many prevailing technologies. Customers can access our technology by purchasing our HTG EdgeSeq system and assays for their internal use or through our Tucson-based VERI/O service laboratory, including molecular profiling of cohorts and development of custom RUO panels to support early-stage clinical programs and investigational-use-only assays for clinical trials. However, with the release of the HTP, revenue from our RUO assay design services is expected to be lower than historical levels, as our RUO assay design services revenue is replaced by HTP consumables purchases and sample processing laboratory services using the HTP. Our product and service solutions have enabled us to access a number of early-stage biomarker discovery programs. We believe this approach allows us access to new opportunities collaborating with biopharmaceutical companies in their future drug development programs. Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED DECEMBER 21, 2022 PROSPECTUS 1,012,555 Shares of Common Stock Pre-Funded Warrants to Purchase up to 1,012,555 Shares of Common Stock Series A-1 Warrants to Purchase up to 1,012,555 Shares of Common Stock Series A-2 Warrants to Purchase up to 1,012,555 Shares of Common Stock Placement Agent Warrants to Purchase up to 30,376 Shares of Common Stock We are offering in a best-efforts offering up to 1,012,555 shares of common stock, together with accompanying Series A-1 warrants to purchase up to 1,012,555 shares of our common stock and Series A-2 warrants to purchase up to 1,012,555 shares of our common stock, at a combined public offering price of $ per share of common stock and the accompanying warrants. The Series A-1 and Series A-2 warrants are collectively referred to herein as the warrants or accompanying warrants. We are also offering to those purchasers, if any, whose purchase of our common stock in this offering would otherwise result in such purchaser, together with its affiliates and certain related parties, beneficially owning more than 4.99% of our outstanding common stock immediately following the consummation of this offering, the opportunity, in lieu of purchasing common stock, to purchase pre-funded warrants to purchase shares of our common stock, or pre-funded warrants. Each pre-funded warrant will be exercisable for one share of our common stock (subject to adjustment as provided for therein) at any time at the option of the holder until such pre-funded warrant is exercised in full, provided that the holder will be prohibited from exercising pre-funded warrants for shares of our common stock if, as a result of such exercise, the holder, together with its affiliates and certain related parties, would own more than 4.99% of the total number of shares of our common stock then issued and outstanding. However, any holder may increase such percentage to any other percentage not in excess of 9.99%, provided that any increase in such percentage shall not be effective until 61 days after notice to us. The purchase price of each pre-funded warrant will equal the price per share at which shares of our common stock and accompanying warrants to purchase common stock are being sold to the public in this offering, minus $0.001, and the exercise price of each pre-funded warrant will equal $0.001 per share of common stock. For each pre-funded warrant purchased in this offering in lieu of common stock, we will reduce the number of shares of common stock we are offering by one. Pursuant to this prospectus, we are also offering the shares of common stock issuable upon the exercise of the warrants, pre-funded warrants and placement agent warrants offered hereby. Each share of our common stock, or pre-funded warrant in lieu thereof, is being sold together with a Series A-1 warrant to purchase one share of our common stock and a Series A-2 warrant to purchase one share of our common stock. Each warrant will have an exercise price per of $ per share and will be immediately exercisable. The Series A-1 warrants will expire on the 5th anniversary of the original issuance date. The Series A-2 warrants will expire on the 24-month anniversary of the original issuance date. The shares of our common stock and warrants are immediately separable and will be issued separately, but will be purchased together in this offering. This offering will terminate on December 30, 2022, unless we decide to terminate the offering (which we may do at any time in our discretion) prior to that date. We will have one closing for all the securities purchased in this offering. The combined public offering price per share (or pre-funded warrant) and accompanying warrants will be fixed for the duration of this offering. Table of Contents including logos, artwork and other visual displays, may appear without the or TM symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the rights of the applicable licensor to these trademarks and trade names. We do not intend our use or display of other companies trade names or trademarks to imply a relationship with, or endorsement or sponsorship of us by, any other companies. Table of Contents Biopharmaceutical companies are continually seeking to improve their drug development processes and the efficacy and safety of their drugs, as existing processes are expensive, extremely risky and very time consuming. HTG Therapeutics, our drug discovery business unit, leverages our HTP and transcriptomic profiling technologies, applying them early in the drug discovery process and in conjunction with our machine learning-based chemical library design platform, with the goal of ultimately yielding de-risked drug candidate molecules with greater potential for development success. HTG Therapeutics uses our medicinal chemistry platform to build an initial chemical library for early-stage validated target molecules. We then conduct cell-based screening and use our transcriptomic profiling capabilities to inform molecule optimization with a goal to use primary data from model systems to enhance chemical structure redesign to optimize for efficacy and toxicity and de-risk the drug candidate for clinical development. We expect to enter into partnerships to carry some of our drug candidates into development and to advance others into development ourselves. In addition, we expect to retain and capitalize upon companion diagnostic ( CDx ) rights through the clinical development of these assets and post commercialization of an approved drug. Our Drug Discovery Approach In June 2021, we announced the formation of HTG Therapeutics business unit, with the addition of several highly experienced drug development professionals to our leadership team. This team has since been joined by several external collaborators who are expected to contribute meaningful sample cohorts across multiple disease and therapy areas to support the discovery, design and selection of our early candidate molecules with therapeutic promise. HTG Therapeutics is leveraging our existing HTP and transcriptomic profiling technologies and applying these technologies early in the drug discovery process in conjunction with our machine learning-based chemical library design platform, with a goal of ultimately yielding de-risked drug candidate molecules with a greater potential for development success. Through the use of our Transcriptome-Informed Drug Discovery model, we expect to accelerate the drug discovery and development process by further uncovering and understanding biological mechanisms and making more thorough assessments of on- and off-target effects of drug candidates earlier in the discovery process to enable more well-informed candidate design and selection. During the first quarter of 2022, we released our first proof-of-approach white paper ( WP1 ), which we believe demonstrated the utility of our proprietary profiling technologies as a key component of our novel drug discovery and design platform. We followed WP1 with a second white paper ( WP2 ) in the second quarter of 2022. In our view, WP2 further established the utility of our transcriptome-informed approach to drug design and discovery by applying our planned approach to our initial therapeutic target. As anticipated, the results of the studies summarized in WP2 revealed several indication-specific effects as well as potential undesirable effects of the initial therapeutic target through analysis of the transcriptomic profiles from compound-treated human cell line test systems. Throughout the third quarter, we strengthened our drug discovery core platform technology, including advancing the machine-learning component of our platform with the refinement of key proprietary algorithms while continuing to generate our own internal data supporting training sets. In addition, we made capital investments to establish internal cell culture capabilities. These lab-based capabilities provide us with the ability to conduct investigative studies on site, supporting the development and evolution of our transcriptome-informed drug discovery platform more efficiently and with greater flexibility. Our medicinal chemistry effort has produced a series of chemical libraries for our first target, and our most advanced library for this target has entered preclinical characterization, with a series of data generated Including early efficacy data in two different disease states. We continue to characterize the most promising candidate molecules for measures of efficacy, safety and pharmaceutical considerations, deductively assessing specific candidate selections for recommendation to enter preclinical development through potential licensing and/or partnering opportunities in the near term. Specifically, we expect to conclude the discovery phase for our initial drug candidates and first indication by the end of 2022 and to initiate preliminary partnering conversations at that time. Further, we expect to produce additional data for these candidates, potentially supporting additional Table of Contents We have engaged H.C. Wainwright & Co., LLC, or the placement agent, to act as our exclusive placement agent in connection with the securities offered by this prospectus. The placement agent has agreed to use its reasonable best efforts to arrange for the sale of the securities offered by this prospectus. The placement agent is not purchasing or selling any of the securities we are offering, and the placement agent is not required to arrange the purchase or sale of any specific number of securities or dollar amount. Our common stock is listed on The Nasdaq Capital Market under the symbol HTGM. On December 19, 2022, the last reported sale price of our common stock on The Nasdaq Capital Market was $9.876 per share (after giving effect to a 1-for-12 reverse stock split effected on December 20, 2022). The public offering price for the securities offered by this prospectus will be determined between us and the investors in this offering at the time of pricing, and may be at a discount to the current market price. Therefore, the recent market price of $9.876 per share of common stock used throughout this prospectus may not be indicative of the actual combined public offering price for our common stock or pre-funded warrants, as applicable, and the accompanying warrants. There is no established trading market for the warrants or pre-funded warrants and we do not expect a market to develop. In addition, we do not intend to apply for the listing of the warrants or pre-funded warrants on any national securities exchange or other trading market. Without an active trading market, the liquidity of the warrants and the pre-funded warrants will be limited. We have agreed to pay the placement agent the placement agent fees set forth in the table below, which assumes that we sell all of the securities offered by this prospectus. See Plan of Distribution on page 20 of this prospectus for more information regarding these arrangements. There is no minimum number of shares of common stock or pre-funded warrants or minimum aggregate amount of proceeds that is a condition for this offering to close. We may sell fewer than all of the shares of common stock and pre-funded warrants (and accompanying warrants) offered hereby, which may significantly reduce the amount of proceeds received by us, and investors in this offering will not receive a refund if we do not sell all of the securities offered hereby. In addition, we have not established an escrow account in connection with this offering. Because there is no escrow account and no minimum number of securities or amount of proceeds, investors could be in a position where they have invested in us, but we have not raised sufficient proceeds in this offering to adequately fund the intended uses of the proceeds as described in this prospectus. Per Share and Accompanying Warrant Per Pre-Funded Warrant and Accompanying Warrant Total Public offering price $ $ $ Placement Agent fees(1) Proceeds, before expenses, to us(2) $ $ $ (1) We have agreed to (i) pay the placement agent a cash fee equal to 6.5% of the aggregate gross proceeds raised at the closing of this offering and (ii) pay the placement agent a management fee equal to 0.5% of the aggregate gross proceeds raised in this offering. We have also agreed to reimburse the placement agent for certain expenses and closing costs. In addition, we have agreed to issue to the placement agent warrants to purchase up to a number of shares of our common stock equal to 3.0% of the number of shares of common stock and pre-funded warrants sold in this offering, at an exercise price equal to 125% of the public offering price per share of common stock and accompanying warrants. The placement agent warrants will not be listed on any national securities exchange or other trading market. See Plan of Distribution for additional information and a description of the compensation payable to the placement agent. (2) Because there is no minimum number of securities or amount of proceeds required as a condition to closing in this offering, the actual public offering amount, placement agent fees, and proceeds to us, if any, are not presently determinable and may be substantially less than the total maximum offering amounts set forth above. For more information, see Plan of Distribution. Table of Contents indications which share the same pharmacologic target in the first half of 2023. We also plan to complete the discovery phase for our second target in mid-2023, and to have indications relating to that target later in 2023 and into early 2024. Finally, in 2023, we plan to enter into the early discovery phase for additional therapeutic targets to further diversify our discovery pipeline, with the goal of further demonstrating the capability of our platform to be applied across therapy areas agnostically. Revenue from our Profiling Products We believe the future financial performance of our profiling business will continue to be driven by adoption and utilization of our HTG EdgeSeq instruments and consumables, and an overall increase in the number and type of customers using our technology. As such, we believe the primary measures of adoption for our profiling technology are the number of total active customers, the number of active programs in our biopharmaceutical company customer pipeline, the number of instruments actively producing revenue in our installed base and revenue growth relating to new and existing customers. Total active customers and active installed base reflect customers and instruments that have generated revenue for us within the last 12 months. To be included in our active programs metric, a program needs to be associated with a pharma sponsored clinical trial, be traceable to a program on clinicaltrials.gov and have generated revenue for us within the last 12 months. As of September 30, 2022, we had 77 active customers, 57 active programs and 50 instruments actively producing revenue in our installed base. Our ability to increase instrument and consumable revenue depends on several factors, including (i) our ability to increase adoption of our HTG EdgeSeq platform throughout the scientific research community; (ii) the efforts of our sales and marketing teams to demonstrate the utility of our products and technology; (iii) our ability to develop and market novel molecular profiling panels to address unmet customer needs; (iv) our ability to demonstrate the benefits of our products compared to our competitors to key opinion leaders and customers; and (v) our ability to expand the addressable market for our HTG EdgeSeq platform through enhancement of our existing products and services, the development of new applications and expansion into new markets. In August 2021, we completed the commercial release of our HTG Transcriptome Panel, designed to provide extensive coverage of most human mRNA transcripts, simultaneously interrogating nearly 20,000 genes, while maintaining the sample efficiency, ease of use and robust results provided by our existing HTG EdgeSeq technology. The release of our HTP, coupled with our existing miRNA Whole Transcriptome Assay, which shares a harmonized sample preparation protocol, has further differentiated us from our competitors and has allowed us to expand our position in oncology and to diversify the use of our panels in other critical areas such as immunology, infectious disease, diabetes, cardiology and neurology. We expect to focus our future profiling-related development efforts on the expansion of the sample types available for use with both of these assays, as deemed appropriate based upon customer needs and the ability of these efforts to grow our active installed base and drive larger consumable annuities for our menu of proprietary panels. We believe an increasing number of publications referencing our technology and the growing number of customers adopting our technology continues to reflect customer demand for and interest in our technology. In the second quarter of 2022, the first peer-reviewed journal article related to our HTP was published by one of our customers less than one year after the product s initial commercial release. Two additional peer-reviewed articles on HTP were published in the third quarter of 2022. In this same period, three of our large pharma customers presented at bioscience conferences about their use of our technology as part of their biomarker strategies for retrospective studies and clinical trials. Publications and abstracts which referenced our HTG EdgeSeq technology exceeded 400 in the third quarter of 2022, ending the quarter at 407. Despite this progress reflecting the interest in and adoption of our technology, the length of our sales cycle and the continuing uncertainty of budget or post-COVID-19 clinical study prioritization by our customers, we expect that we will continue to see fluctuations in our profiling revenue on a period-to-period basis. Table of Contents This prospectus, including such information that is incorporated by reference, contains summaries of certain provisions contained in some of the documents described herein, but reference is made to the actual documents for complete information. All the summaries are qualified in their entirety by the actual documents. Copies of some of the documents referred to herein have been filed or have been incorporated by reference as exhibits to the registration statement of which this prospectus forms a part, and you may obtain copies of those documents as described in this prospectus under the heading Where You Can Find Additional Information. Investing in our securities involves a high degree of risk. Please read Risk Factors beginning on page 6 of this prospectus as well as any other risk factors and other information contained in any other document that is incorporated by reference herein. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The securities are not being offered in any jurisdiction where the offer is not permitted. Delivery of the common stock, pre-funded warrants and accompanying warrants offered hereby is expected to be made on or about December , 2022, subject to satisfaction of certain customary closing conditions. H.C. Wainwright & Co. The date of this prospectus is December , 2022. Table of Contents The Offering Common stock offered by us 1,012,555 shares. Pre-funded warrants offered by us We are also offering to those purchasers, if any, whose purchase of common stock in this offering would otherwise result in such purchaser, together with its affiliates and certain related parties, beneficially owning more than 4.99% of our outstanding common stock immediately following the consummation of this offering, the opportunity, in lieu of purchasing common stock, to purchase pre-funded warrants to purchase up to shares of our common stock. For each pre-funded warrant we sell, the number of shares of common stock we are offering will be decreased on a one-for-one basis. The purchase price of each pre-funded warrant will equal the price per share at which the shares of common stock and accompanying warrants to purchase common stock are being sold to the public in this offering, minus $0.001, and the exercise price of each pre-funded warrant will be $0.001 per share of common stock. Each pre-funded warrant will be exercisable immediately upon issuance and will not expire. This prospectus also relates to the offering of the shares of common stock issuable upon exercise of such pre-funded warrants. See Description of the Securities We Are Offering-Pre-Funded warrants for a discussion on the terms of the pre-funded warrants. Each pre-funded warrant is exercisable for one share of our common stock (subject to adjustment as provided therein) at any time at the option of the holder, provided that the holder will be prohibited from exercising its pre-funded warrant for shares of our common stock if, as a result of such exercise, the holder, together with its affiliates and certain related parties, would own more than 4.99% of the total number of shares of our common stock then issued and outstanding. However, any holder may increase such percentage to any other percentage not in excess of 9.99%, provided that any increase in such percentage shall not be effective until 61 days after notice to us. Warrants offered by us Series A-1 warrants to purchase up to 1,012,555 shares of our common stock and Series A-2 warrants to purchase up to 1,012,555 shares of our common stock. Each share of our common stock, or pre-funded warrant in lieu thereof, is being sold together with a Series A-1 warrant to purchase one share of our common stock and a Series A-2 warrant to purchase one share of our common stock. Each warrant will have an exercise price of $ per share and will be immediately exercisable. Each Series A-1 warrant will expire on the 5th anniversary of the original issuance date. Each Series A-2 warrant will expire on the 24-month anniversary of the original issuance date. This prospectus also relates to the offering of the shares of common stock issuable upon exercise of such warrants. Common stock outstanding after this offering 1,933,230 shares (assuming no sale of any pre-funded warrants and assuming none of the warrants to purchase common stock issued in this offering or the warrants issued to the placement agent are exercised). Table of Contents Use of proceeds We currently expect to use the net proceeds from this offering for general corporate purposes, which may include research and development expenses, clinical trial expenses, capital expenditures and working capital. For additional information please refer to the section entitled Use of Proceeds of this prospectus.
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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@@ -0,0 +1,1009 @@
+Prospectus Summary and Risk Factors, and include statements regarding
+the intent, belief or current expectations of the Company and management that are subject to known and unknown risks, uncertainties and
+assumptions. Examples of forward-looking statements include statements relating to macroeconomic conditions; our expectations regarding
+future growth, including future revenue; our expectations regarding new products and market acceptance of current and new products; anticipated
+changes in regulations and market acceptance of our products and industry; our growth plans and opportunities, including our strategies
+for future acquisitions, future product expansion, potential client marketing and targeting and potential geographic expansion; estimated
+returns on future acquisitions; and other statements concerning our plans, objectives, goals, strategies, future events, future revenues
+or performance, capital expenditures, financing needs, the competitive landscape for our products, plans or intentions relating to acquisitions
+and developments and other information that is not historical information, and our assumptions underlying these expectations.
+
+ 
+
+ 2
+
+ Table of Contents
+
+ 
+
+ 
+
+This
+prospectus, any prospectus supplement and the information incorporated by reference in this prospectus and any prospectus supplement
+also contain statements that are based on the current expectations of our Company and management. You are cautioned that any such forward-looking
+statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially
+from those projected in the forward-looking statements as a result of various factors.
+
+ 
+
+Because
+forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, you should
+not rely upon forward-looking statements as predictions of future events. The events and circumstances reflected in the forward-looking
+statements may not be achieved or occur and actual results could differ materially from those projected in the forward-looking statements.
+Except as required by applicable law, including the securities laws of the United States and the rules and regulations of the SEC, we
+do not plan to publicly update or revise any forward-looking statements contained herein after we distribute this prospectus, whether
+as a result of any new information, future events or otherwise.
+
+ 
+
+You
+should also consider carefully the statements under Risk Factors and other sections of this prospectus, which address additional
+facts that could cause our actual results to differ from those set forth in the forward-looking statements. We caution investors not
+to place significant reliance on the forward-looking statements contained in this prospectus.
+
+ 
+
+Prospectus
+Summary
+
+ 
+
+The
+following summary highlights material information found in more detail elsewhere in the prospectus. It does not contain all of the information
+you should consider. As such, before you decide to buy our common stock, in addition to the following summary, we urge you to carefully
+read the entire prospectus, especially the risks of investing in our common stock as discussed under Risk Factors. 
+
+ 
+
+ 3
+
+ Table of Contents
+
+ 
+
+ 
+
+About
+American International Holdings Corp.
+
+ 
+
+The
+Company is headquartered in Plano, Texas, and is an investor, developer and asset manager with diversified assets across the healthcare
+supply chain. The Company s portfolio encompasses telemedicine and other virtual health platforms, subscriber based primary care
+and concierge medicine plans, preventative care solutions and wellness related assets such as mental and behavioral health services,
+a digital online mail order pharmacy, a men s wellness products and services company, as well as its own proprietary life coaching
+platform. The Company provides its various services through direct-to-consumer and business-to-business distribution channels and is
+focused on developing, acquiring and bringing to market technologies and solutions that we believe can advance the quality of life for
+the global community. Additionally, the Company seeks opportunities to acquire and grow businesses that possess strong brand values and
+that can generate long-term sustainable free cash flow and attractive returns in order to maximize value for all stakeholders.
+
+ 
+
+The
+Company currently is the parent to ten subsidiaries, of which seven are wholly-owned subsidiaries and three (3) are majority-owned subsidiaries.
+In 2021, the Company ceased operations of five of its ten subsidiaries in order to focus on the subsidiaries that better aligned with
+the purpose of the Company and its ongoing business plan.
+
+ 
+
+ZIPDOCTOR,
+INC. 100% OWNED
+
+ 
+
+On
+April 28, 2020, the Company incorporated a wholly-owned subsidiary, ZipDoctor, Inc. ( ZipDoctor ) in the state of
+Texas. ZipDoctor launched its online, direct-to-consumer subscription-based telemedicine platform www.ZipDoctor.co in the third
+quarter of 2020. ZipDoctor provides its customers with unlimited, 24/7 access to board certified physicians and licensed mental and behavioral
+health counselors and therapists via a newly developed, monthly subscription-based online telemedicine platform. ZipDoctor s online
+telemedicine platform is available to customers across the United States and offers bilingual coverage (English and Spanish), with virtual
+visits taking place either via the phone or through a secured video chat platform. ZipDoctor customers subscribe through the website
+and are only required to pay a monthly fee, which is determined based on whether they are an individual, a couple, or a family. ZipDoctor
+is currently being sold on a direct-to-consumer basis, with an emphasis on digital marketing and advertising.
+
+ 
+
+Digital
+Marketing Initiative: The ZipDoctor website was originally designed to be marketed and sold primarily using a digital and social
+media advertising campaign. Shortly after the website s launch, ZipDoctor began to advertise on Google pay per click (PPC), search
+engine optimization (SEO), Facebook and Instagram. Shortly after launching, the Company decided to shift the focus of its marketing to
+a direct sales approach, resulting in the formation and launch of EPIQ MD, Inc.
+
+ 
+
+Going
+Forward Strategy: With EPIQ MD, Inc. taking over the sales and marketing of the direct-to-consumer telemedicine platform, ZipDoctor
+has changed its business plan to focus on developing customized telemedicine solutions for niche, or specialty care, areas of medicine.
+
+ 
+
+Telemedicine
+Platform Provider for Pharmacies. ZipDoctor is targeting relationships with specialty compound pharmacies seeking both an online
+telemedicine platform and a network of doctors to assist in facilitating patient online visits and to streamline the medical intake,
+patient demographics, health insurance verifications and overall prescription process. In exchange, ZipDoctor will receive a monthly
+fee on a per-patient per month basis for this customized access to the telemedicine platform. The initial focus will be on Texas based
+pharmacies, however, if successful in Texas, ZipDoctor plans to expand its customized telemedicine solution to pharmacies across the
+United States.
+
+ 
+
+ 4
+
+ Table of Contents
+
+ 
+
+ 
+
+On
+August 15, 2021, ZipDoctor entered into a Telemedicine Services Agreement (the Services Agreement ) with Murphy RX,
+LLC ( Murphy ), a Texas-based specialty pharmacy, which has since ceased operations as of January 31, 2022. Pursuant
+to the Services Agreement, ZipDoctor agreed to provide Murphy with access to its centralized technology platform, to collect and manage
+patient demographics, and access to telemedicine services. Murphy agreed to pay ZipDoctor a monthly fee on a per-patient basis for the
+use of the technology platform and for access to primary care telemedicine services. ZipDoctor also agreed to provide continued support
+for the ZipDoctor website through the term of the agreement. The Services Agreement is no longer in effect, as Murphy ceased operations
+effective as of January 31, 2022.
+
+ 
+
+As
+of the date of this prospectus, ZipDoctor has approximately 100 total members subscribed to its subscription-based telemedicine platform
+at www.ZipDoctor.co. Monthly subscription payments range from $25/month to $45/month, depending on how many family members are
+included, and provide members with unlimited, 24/7 access to board certified physicians and licensed mental and behavioral health counselors
+and therapists.
+
+ 
+
+EPIQ
+MD, INC. 100% OWNED
+
+ 
+
+On
+October 23, 2020, the Company incorporated a wholly-owned subsidiary, EPIQ MD, Inc. ( EPIQ MD ) in the state of Nevada.
+EPIQ MD is a direct-to-consumer, telemedicine and healthcare company targeting Americans who are uninsured or underinsured. The EPIQ
+MD service offering is a convergence of primary care telemedicine, preventative care services and wellness programs under the
+EPIQ MD brand and on a single platform. EPIQ MD markets and sells its services direct to end-use consumers, as well as through business-to-business
+(B2B) efforts, by focusing on employers in the targeted industries.
+
+ 
+
+Products
+& Services
+
+ 
+
+EPIQ
+MD s telemedical services revolve around three services (1) primary care, (2) mental health care, and (3) prevention. Using cloud-based
+software, EPIQ MD has been able to merge these services under a single platform.
+
+ 
+
+Primary
+care with EPIQ MD connects users to board certified doctors and medical professionals who can treat most non-emergency conditions using
+telemedicine. Similarly, EPIQ MD s mental health services connect users with licensed therapists and counselors. As for EPIQ MD s
+preventive care, the Company is using data driven technologies (wearables and apps), nutritionist and lab services, to help attempt to
+mitigate chronic diseases and the risk factors associated with them. In the future, EPIQ MD plans to add in-home medical devices to record
+vital information, offering what we believe to be the ambit of services between patient and doctor via the use of EPIQ MD s telemedicine
+platform.
+
+ 
+
+ 5
+
+ Table of Contents
+
+ 
+
+ 
+
+EPIQ
+MD also provides its subscribers with an option to participate in two premium add-on services, EPIQ LUX and EPIQ Paws. EPIQ LUX provides
+subscribers with discounts to ancillary healthcare related services such as laboratory services, dental and vision discount plans, prescription
+drug discounts, and imaging services and EPIQ Paws provides subscribers with access to virtual consultations with licensed veterinarians.
+
+ 
+
+As
+of the date of this prospectus, EPIQ MD has nominal subscribers as it is expanding its marketing initiatives. However, EPIQ MD is currently
+registered to do business and is being marketed in Alaska, Georgia, Illinois, Texas, Arizona, New
+Mexico, Colorado, Louisiana, Mississippi, Alabama, Florida, Nevada and Utah. To ensure the highest quality control, it plans to
+scale up its full-service coverage incrementally to all 50 U.S. states by year-end 2022, funding permitting.
+
+ 
+
+Marketing
+Strategy
+
+ 
+
+With
+approximately 30 million people uninsured in the United States (according to 2019 Congressional Budget Office estimates) and 45 percent
+of U.S. adults between ages of 19 and 64 being inadequately insured (according to a February 2019 Survey Brief by the Commonwealth Fund),
+and an estimated 530,000 families turning to bankruptcy each year due to medical expenses (according to a study published in the March
+2019 American Public Journal of Health), the Company sees an opportunity to make a positive impact in the lives of these uninsured or
+underinsured people. We believe that this is the demographic that the healthcare system has abandoned, ignored and/or left behind and
+is what we believe to be a largely underserved group.
+
+ 
+
+To
+grow its subscriber base, EPIQ MD has implemented its own direct-to-consumer distribution channel referred to as the Ambassador
+Program . The Ambassador Program is intended to allow social influencers, community leaders and entrepreneurial-minded sales agents
+to market and sell EPIQ MD s services across the nation, on a commission-only basis.
+
+ 
+
+Market
+Opportunity
+
+ 
+
+As
+previously described above, with approximately 30 million people uninsured in the United States and 45 percent of U.S. adults between
+ages of 19 and 64 being inadequately insured, EPIQ MD believes that their service offerings will be instrumental in reaching these Americans
+and plans to reach this demographic through its own direct-to-consumer distribution channel, or Ambassador Program, and through its commercial
+division that will target small and medium sized businesses (SMB s) and municipalities.
+
+ 
+
+According
+to a 2020 study by the Kaiser Family Foundation, a leading industry research firm ( Key Facts About the Uninsured Population ),
+the high cost of insurance is one of the main reasons individuals lack coverage (in 2019, 73.7% of uninsured adults said they were uninsured
+because the cost of coverage was too high); and, individuals with income below 200% of the Federal Poverty Level (FPL) are at the highest
+risk of being uninsured.
+
+ 
+
+ 6
+
+ Table of Contents
+
+ 
+
+ 
+
+We
+see a significant opportunity to market to these uninsured and/or underinsured persons, and believe that our low-cost, flat rate, telemedical
+services can be an attractive alternative to those persons seeking lower cost health services.
+
+ 
+
+LIFE
+GURU, INC. 51% OWNED
+
+ 
+
+On
+May 15, 2020, the Company acquired a 51% interest in Life Guru, Inc., a Delaware corporation ( Life Guru ). Life Guru
+owns www.LifeGuru.me a website dedicated to providing an online platform to connect consumers to a variety of mentors, professionals,
+life coaches and career coaches. Upon final launch of the platform, it will include functionality enabling: life coaches from around
+the world to access and subscribe to the Life Guru platform; and consumers to filter their life coach options by geographic location,
+language and even the type of currency they would like to pay with. While Life Guru is free to consumers, it generates revenues by charging
+monthly subscription fees to coaches participating on the platform. Further, and depending on the type of subscription plan the life
+coach chooses to participate in, Life Guru receives a percentage of the per session fees generated and earned between the consumer and
+the life coach.
+
+ 
+
+Since
+the LifeGuru.me website was launched around March 2021, Life Guru has been working to optimize the website for mobile and completing
+integration with its merchant account provider to automate monthly payouts to coaches. LifeGuru is currently in the process of marketing
+and onboarding coaches onto the platform.
+
+ 
+
+Industry
+Trends
+
+ 
+
+Life
+coaching has been the second fastest growing industry in the world for over ten consecutive years, behind the information technology
+sector (according to a May 2016 article posted at Forbes.com). The global Personal Development Industry (including market segments from
+holistic approaches, motivational speakers, inspirational websites, personal coaching, and other forms of personal development) was valued
+at approximately $38.28 billion in 2019 and is expected to grow at a compound annual growth rate (CAGR) of 5.1% from 2020 to 2027 (according
+to a July 2020 report by Grand View Research). Moreover, Life Guru believes that improving social skills and focusing on critical areas
+for self-awareness, such as emotions, character traits, habits, individual values, and the psychological need that shapes the day-to-day
+behavior of individuals are gaining importance.
+
+ 
+
+Operational,
+Technological & Cost Advantages
+
+ 
+
+We
+anticipate that coaches that subscribe to the Life Guru platform will benefit from Life Guru s investment in digital marketing
+and promotion, enabling them to reach customers and providing increased visibility. Life Guru has developed a proprietary technology
+platform for coaching online, as well as proprietary video conferencing capabilities for coaching interactively. Through our existing
+marketing partnerships, Life Guru believes it has access to sales tools which allow the effective marketing of coaches across all major
+social media platforms, including and most importantly, LinkedIn. LifeGuru.me is mobile-friendly and can run smoothly on many platforms,
+making it highly scalable.
+
+ 
+
+ 7
+
+ Table of Contents
+
+ 
+
+ 
+
+Subscriptions
+
+ 
+
+Life
+Guru offers free membership for all consumers to gain access to the site and search for life coaches. Life Guru s model is to charge
+coaches, and not members, for the use of its services. The Company currently offers three different subscription levels to life coaches,
+with varying levels of promotion on the Life Guru site, prominence of search results, and commissions payable. As of the date of this
+prospectus, Life Guru has no members and approximately 100 life coaches have signed up to use the platform.
+
+ 
+
+Growth
+Objectives
+
+ 
+
+In
+addition to marketing Life Guru directly to consumers, Life Guru intends to implement packages to be sold to various businesses and corporations,
+which can, in turn, be marketed as a corporate benefit by employers. Life Guru calls this Life Guru Corporate . A recent
+survey of 256 companies by the National Alliance of Healthcare Purchaser Coalitions, a nonprofit employer group, found that 53% of employers
+are providing special emotional and mental health programs for their workforce in the wake of the pandemic. Life Guru believes that Life
+Guru Corporate represents important potential upside in targeting the business and corporate world, and providing services to employees
+on an ongoing basis. Life Guru Corporate can only be developed once the platform has achieved a reputable brand and a substantial amount
+of high-quality business coaches are engaged, and Life Guru does not anticipate launching Life Guru Corporate with fewer than 200 life
+coaches, provided Life Guru s projected milestones are met.
+
+ 
+
+MANGOCEUTICALS,
+INC. 80% OWNED
+
+ 
+
+On
+October 7, 2021, the Company incorporated Mangoceuticals, Inc. ( Mangoceuticals ) in the
+state of Texas with the intent of focusing on developing, marketing and selling a variety of men s wellness products and services
+via a telemedicine platform. To date, the Company has identified men s wellness telemedicine services and products as a growing
+sector in the most recent years and especially related to the areas of erectile dysfunction and hair loss products. In this regard, Mangoceuticals
+is currently in the process of developing and preparing to market a new brand of erectile dysfunction (ED) products that delivers fast
+acting results through a proprietary combination of FDA approved ingredients.
+
+ 
+
+Mangoceuticals
+plans to market and sell this new brand of ED products exclusively online and will require the use of a telemedicine visit, a doctor s
+prescription and the fulfillment of the prescription by pharmacy licensed in the state in which the customer resides. Mangoceuticals
+plans to rely heavily on digital and social media marketing through channels such as Facebook, Instagram, Twitter, Snap Chat and TikTok
+and further has plans to use digital marketing with the goal of creating viral marketing campaigns, using social media influencers and
+celebrities, funding permitting.
+
+ 
+
+Our
+goal is to eventually sell this new brand of ED products nationwide and to use EPIQ Scripts (described below) as its mail order pharmacy
+to fulfill the ED prescriptions. Mangoceuticals is currently in the branding and development stage of this ED product and anticipates
+a planned and limited launch in the Texas market in the second quarter of 2022 with the intent of expanding its marketing initiatives
+at a pace in which Epiq Scripts obtains additional state licenses across the United States.
+
+ 
+
+ 8
+
+ Table of Contents
+
+ 
+
+ 
+
+Subsequent
+to incorporation, Mangoceuticals issued 1,000,000 shares of common stock each to Jacob D. Cohen, the Chief Executive Officer of the Company,
+and a third party, in consideration for services rendered. As a result, Mangoceuticals is currently 80% owned by the Company.
+
+ 
+
+EPIQ
+SCRIPTS, LLC 51% OWNED
+
+ 
+
+On
+January 24, 2022, the Company formed EPIQ Scripts, LLC ( EPIQ Scripts ) in the state of Texas. EPIQ Scripts has been
+established with the intent of operating as a close-door online mail order pharmacy with a specific target and vision to obtain licenses
+in all 50 states across the U.S., of which no state licenses have been obtained as of the date of this prospectus. EPIQ Scripts also
+plans to seek to become accredited with the most respected and highly recognized authorities in the industry, such as Utilization
+Review Accreditation Commission (URAC), Legit Script, Accreditation Commission for Health
+Care (ACHC), and National Association of Boards of Pharmacy (NABP) Digital Pharmacy.
+EPIQ Scripts also intends to obtain in-network contracts with all major Pharmacy Benefit Managers (PBM) and insurance payors.
+
+ 
+
+Market
+Opportunity
+
+ 
+
+It
+is anticipated that if licenses, accreditations and in-network contracts are secured in all 50 U.S. states, EPIQ Scripts will be able
+to market itself to the many up and coming telemedicine companies that have been on the rise since early 2020. Pursuant to a July 9,
+2021 article published by McKinsey & Company, according to a study taken by McKinsey & Company, in
+April 2020, overall telehealth utilization for office visits and outpatient care was 78 times higher than in February 2020. Even
+though telemedicine use has now leveled off as in-person visits have returned, McKinsey & Company is still consistently seeing use
+that is 38 times higher than pre-pandemic numbers. Furthermore, a majority of Americans have now tried out telehealth. According to an
+article published at Sykes.com, a March 2021 survey of 2,000 U.S. adults undertaken by Sykes.com found that by March 2021, more than
+61% of such surveyed individuals had made a telehealth/telemedicine appointment, which is a massive increase from just 19.5% a year prior,
+according to Sykes. We further believe that telemedicine use is now widespread across demographics.
+
+ 
+
+We
+believe the significant increases in demand for telemedicine has created a vacuum for pharmacies that have the capabilities to handle
+the prescription volume generated by these platforms. We believe that EPIQ Scripts planned mail order pharmacy, which is expected
+to have advanced API capabilities and infrastructure and be supported with nationwide licenses and accreditations can position itself
+to capitalize on the current market opportunity.
+
+ 
+
+EPIQ
+Scripts has currently filed with the Utilization Review Accreditation Commission (URAC) to obtain
+its pharmacy accreditation and is in the process of obtaining its first state license in the State of Texas, which it anticipates receiving
+in April 2022. Once the Texas state license is obtained, EPIQ Scripts will be able to apply for additional state licenses until it has
+obtained all 50 state licenses, with some state licenses easier to obtain and quicker to obtain than others. EPIQ Scripts intends to
+have licenses to operate in all 50 states by the first quarter of 2023.
+
+ 
+
+*
+* * * * *
+
+ 
+
+ 9
+
+ Table of Contents
+
+ 
+
+ 
+
+The
+Company intends to continue to grow its business both organically and through identifying acquisition targets over the next 12 months
+in the telemedicine, life coaching and wellness space, funding permitting. As these opportunities arise, the Company will determine the
+best method for financing its growth which may include the issuance of additional debt instruments, common stock, preferred stock, or
+a combination thereof, any one or more of which may cause significant dilution to existing shareholders. The
+Company requires approximately $5 million to implement its current business strategy for its different subsidiaries and to support potential
+growth. We expect to raise funds in the future through the sale of debt and/or equity in order to allow us to operate for the
+next twelve months and may need to raise further additional capital in order to expedite our growth through acquisitions, none of which
+are currently planned. There is no assurance that we will be successful in raising such funds and if we do raise funds, this may result
+in substantial dilution to current investors.
+
+ 
+
+DISCONTINUED
+OPERATIONS:
+
+ 
+
+MEDICAL
+SPA AND WELLNESS
+
+ 
+
+The
+Company previously operated three wholly-owned subsidiaries that were in the Medical Spa and Wellness Sector (collectively hereinafter
+referred to as MedSpa , or VISSIA ), the operations of which were discontinued in October 2020:
+
+ 
+
+ 
+ 
+ 1.
+ VISSIA
+ MCKINNEY, LLC (F/K/A NOVOPELLE DIAMOND, LLC) 100% OWNED
+
+ 
+ 
+
+VISSIA
+McKinney was a physician supervised, medical spa and wellness clinic that offered a full menu of wellness services including anti-aging,
+weight loss and skin rejuvenation treatments and was located at 5000 Collin McKinney Parkway, Suite 150, McKinney, Texas 75070.
+
+ 
+
+ 
+ 
+ 2.
+ VISSIA
+ WATERWAY, INC. (F/K/A NOVOPELLE WATERWAY, INC.) 100% OWNED
+
+ 
+ 
+
+VISSIA
+McKinney was a physician supervised, medical spa and wellness clinic that offered a full menu of wellness services including anti-aging,
+weight loss and skin rejuvenation treatments and was located at 25 Waterway, Suite 150, The Woodlands, Texas.
+
+ 
+
+ 
+ 
+ 3.
+ NOVOPELLE
+ TYLER, INC. 100% OWNED
+
+ 
+ 
+
+On
+December 3, 2019, the Company formed and organized Novopelle Tyler, Inc. in the State of Texas with the plan to come to terms on a retail
+location for a new med spa to be located in Tyler, Texas. The Company no longer intends to open this location and no activity has been
+performed under this entity to date.
+
+ 
+
+*
+* * * *
+
+ 
+
+ 10
+
+ Table of Contents
+
+ 
+
+ 
+
+As
+a result of COVID-19 and stay-at-home and social distancing orders issued in McKinney and The Woodlands, Texas, we had
+to close both of our then operational MedSpas, VISSIA McKinney and VISSIA Waterway, Inc., effective March 10, 2020, and which resulted
+in both the loss of income and the loss of substantially all of our MedSpa employees, who had to be let go. VISSIA Waterway, Inc. reopened
+effective June 21, 2020 and VISSIA McKinney reopened effective August 8, 2020. However, due to the termination of employees associated
+with the shutdown we were forced to expend resources to attract, hire and train completely new staff for preparation of the re-launchings.
+Notwithstanding the re-openings, customer traffic and demand at our VISSIA Waterway, Inc. and VISSIA McKinney MedSpa locations failed
+to rebound to pre-COVID-19 levels due to COVID-19 and the pandemic s effects on the economy, and because we were unable to predict
+the length of the pandemic or ultimate outcome thereof, and further due to our limited capital resources, effective on October 25, 2020,
+we made the decision to close both our VISSIA Waterway, Inc. and VISSIA McKinney locations. Our former MedSpa operations and assets are
+included under discontinued operations in the statement of operations and balance sheet included herein for the year ended December 31,
+2021 and for the year ended, December 31, 2020.
+
+ 
+
+ 
+ 
+ 4.
+ CAPITOL
+ CITY SOLUTIONS, USA, INC. 100% OWNED
+
+ 
+ 
+
+On
+September 17, 2019, the Company formed and organized Capitol City Solutions USA, Inc. ( CCS ) in the State of Texas
+to act as a general contracting and construction company focused on the remodeling, general construction and interior finish of both
+the Company s then MedSpa locations (which have since been closed) as well as to market to other commercial real estate projects
+within the United States. The Company made the decision to cease any further construction-based operations under CCS in July 2021, in
+order to focus on the subsidiaries that better aligned with the purpose of the Company and its ongoing business plan in the telehealth
+and wellness space.
+
+ 
+
+ 
+ 
+ 5.
+ LEGEND
+ NUTRITION, INC. 100% OWNED
+
+ 
+ 
+
+On
+September 23, 2019, the Company formed and organized Legend Nutrition, Inc. ( Legend Nutrition ) in the State of Texas
+to act as a new brand of retail vitamin and supplement stores to be branded and marketed as Legend Nutrition. October 18, 2019, Legend
+entered into an Asset Purchase Agreement to acquire all of the assets associated with and related to a retail vitamin, supplements and
+nutrition store located in McKinney, Texas and previously identified and doing business as Ideal Nutrition. Pursuant
+to the Asset Purchase Agreement, Legend purchased a variety of assets including software, contracts, bank and merchant accounts, products,
+inventory, computers, security systems and other intellectual properties. As Legend Nutrition s lease expired in January 2021,
+the Company made the decision to cease its operations to focus on the subsidiaries that better aligned with the purpose of the Company
+and its ongoing business plan in the telehealth and wellness space.
+
+ 
+
+ 11
+
+ Table of Contents
+
+ 
+
+ 
+
+Government
+Regulation
+
+ 
+
+The
+health care industry is subject to extensive federal, state and local laws and regulations relating to licensure, conduct of operations,
+ownership of facilities, addition of facilities and services, payment for services and prices for services that are extremely complex
+and for which, in many instances, the industry does not have the benefit of significant regulatory or judicial interpretation. We will
+also be subject to regulation regarding sale of our products online and solicitation of clients thereby, as well as through our general
+contractor business and the licensing and code requirements relating thereto.
+
+ 
+
+COVID-19
+Outlook and Discontinued Operations
+
+ 
+
+The
+outbreak of the 2019 novel coronavirus disease ( COVID-19 ), which was declared a global pandemic by the World Health
+Organization on March 11, 2020, and the related responses by public health and governmental authorities to contain and combat its outbreak
+and spread has severely impacted the U.S. and world economies, the market for health spa services, nutrition supplements and our other
+business offerings during the end of the first quarter of 2020, and continuing through the end of 2020 and into 2021. Government mandated
+ stay-at-home and similar orders have to date, and may in the future, prevent us from operating. In late 2020, we made the
+decision to discontinue operations of our VISSIA Waterway, Inc. and VISSIA McKinney MedSpa locations, due to declines in customers and
+issues staffing such facilities, each as a result of the pandemic. Additionally, our Legend Nutrition store saw a deep decline in sales
+due to social distancing orders and decreases in customers who are willing to venture out to brick-and-mortar establishments. Legend
+Nutrition s lease was up January 31, 2021, and the Company chose to not renew the lease, closed the store, and will not continue
+in this line of business moving forward. We also decided to cease offering construction services around July 2021.
+
+ 
+
+As
+of the date of this prospectus, our operations are limited, and consist solely of ZipDoctor, Inc., Life Guru, Inc., EPIQ MD, Inc, Mangoceuticals,
+Inc., and EPIQ Scripts, LLC.
+
+ 
+
+Moving
+forward, economic recessions, including those brought on by the continued COVID-19 outbreak, geopolitical events, including the current
+military conflict between Russia and the Ukraine, inflationary pressures, or other events, may have a negative effect on the demand for
+our services and our operating results. Any prolonged disruption to our operations or work force available is likely to have a significant
+adverse effect on our results of operations, cash flows and ability to meet continuing debt service requirements. All of the above may
+be exacerbated in the future as the COVID-19 outbreak and the governmental responses thereto continues.
+
+ 
+
+Summary
+Risk Factors
+
+ 
+
+Our
+business is subject to numerous risks and uncertainties, including those in the section entitled Risk Factors and elsewhere
+in this prospectus. These risks include, but are not limited to, the following:
+
+ 
+
+ 
+ 
+ 
+ Our
+ limited operating history;
+
+ 
+ 
+
+ 12
+
+ Table of Contents
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Our
+ need for additional funding to support our operations, repay debt and expand our operations;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ continuing effects of COVID-19 on our operations and prospects;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Impairments
+ we may be required to assess in connection with our assets and goodwill as a result of such shutdowns and/or otherwise;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Risks
+ associated with our telehealth platform, including liability in connection therewith, funding needed to support such operations and
+ other risks associated with the operations of the telehealth platform;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Risks
+ associated with the launch of our new closed door online digital pharmacy, Epiq Scripts, LLC, including liability in connection therewith,
+ ability to obtain state licenses, funding needed to support such operations and other risks associated with the operations of an
+ online digital pharmacy;
+
+ 
+
+ 
+ 
+ 
+ Risks
+ associated with the development of our new ED product, including liability in connection therewith, funding needed to support such
+ operations and other risks associated with the operations of the telehealth platform;
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ ability of Life Guru to sign up enough life coaches to make the commercial launch of such website economic, and the willingness of
+ individuals to use such website in the future;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Disruptions
+ to our operations or liabilities associated with future acquisitions;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ ability to continue as a going concern;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ dependence on our Chief Executive Officer and director, Jacob D. Cohen, including the lack of independent directors, and related
+ party transactions affecting the Company;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Competition
+ we face;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ ability to maintain our varied operations, and service our indebtedness;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Material
+ weaknesses in our controls and procedures;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ ability to obtain and maintain adequate insurance;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Legal
+ challenges and litigation;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Liability
+ associated with our contracting operations;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ terms of Mr. Cohen s employment agreement;
+
+ 
+ 
+
+ 13
+
+ Table of Contents
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Dilution
+ caused by the conversion of outstanding notes, conversion of preferred stock, exercise of outstanding warrants, and future fund-raising
+ activities;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ price of, volatility in, and lack of robust trading market for, our common stock; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ fact that Mr. Cohen, our Chief Executive Officer, has voting control over the Company.
+
+ 
+ 
+
+Penny
+Stock Rules
+
+ 
+
+Our
+common stock is considered a penny stock , and subject to the requirements of Rule 15g-9, promulgated under the Exchange
+Act. Penny stock is generally defined as any equity security not traded on an exchange or quoted on NASDAQ that
+has a market price of less than $5.00 per share. Under such rule, broker-dealers who recommend low-priced securities to persons other
+than established customers and accredited investors must satisfy special sales practice requirements, including a requirement that they
+make an individualized written suitability determination for the purchaser and receive the purchaser s consent prior to the transaction.
+The Securities Enforcement Remedies and Penny Stock Reform Act of 1990, also requires additional disclosure in connection with any trades
+involving a stock defined as a penny stock.
+
+ 
+
+The
+required penny stock disclosures include the required delivery, prior to any transaction, of a disclosure schedule explaining the penny
+stock market and the risks associated with it. Such requirements could severely limit the market liquidity of the securities and the
+ability of purchasers to sell their securities in the secondary market. In addition, various state securities laws impose restrictions
+on transferring penny stocks and as a result, investors in the common stock may have their ability to sell their
+shares of the common stock impaired.
+
+ 
+
+Corporate
+Information
+
+ 
+
+Our
+executive offices are located at 7950 Legacy Drive, Suite 400, Plano, Texas 75024 and our telephone number is (469) 963-2644. Our website
+address is https://amihcorp.com. We do not incorporate information on our website into this prospectus or any supplement to this
+prospectus and you should not consider any information on, or that can be accessed through, our website as part of this prospectus or
+any supplement to this prospectus (other than those filings with the SEC that we specifically incorporate by reference into this prospectus
+or any supplement to this prospectus).
+
+ 
+
+Reverse
+Stock Split
+
+ 
+
+We
+have applied to list our common stock and certain warrants to purchase common stock which we plan to sell in the future in a public offering,
+on the NASDAQ Capital Market; however, our application to uplist our common stock and certain warrants on the NASDAQ Capital Market may
+not be approved and our securities may never trade on the NASDAQ Capital Market.
+
+ 
+
+On
+July 30, 2021, our board of directors, and on July 30, 2021, stockholders holding a majority of our outstanding voting shares, approved
+resolutions authorizing a reverse stock split of the outstanding shares of our common stock in the range from one-for-two (1-for-2) to
+one-for-sixty (1-for-60), and provided authority to our board of directors to select the ratio of the reverse stock split in their discretion,
+at any time prior to the earlier of July 30, 2022 and the date of our 2022 annual meeting of shareholders. On January 25, 2022, our board
+of directors, pursuant to such shareholder authority, approved a one-for-sixty (1-for-60) reverse stock split of the outstanding shares
+of our common stock, which is intended to allow us to meet the minimum share price requirement of the NASDAQ Capital Market. Both the
+board of directors and Financial Industry Regulatory Authority, Inc. (FINRA) have approved the reverse stock split, which is proposed
+in order to increase the trading price of the Company s common stock to a level thought to be sufficient to allow an uplisting
+of the Company s common stock on the Nasdaq Capital Market. Notwithstanding the approvals above, the officers of the Company have
+not yet moved forward with the reverse stock split, or filed Articles of Amendment in connection therewith with the Secretary of State
+of Nevada. The Company currently does not have an estimated date for when the reverse stock split will be made effective.
+Because the Company has not formally affected the reverse stock split, none of the outstanding share amounts set forth below have been
+adjusted for such board of directors approved reverse stock split. The board of directors reserves the right to adjust the ratio of the
+reverse stock split and/or terminate the authority for such reverse stock split in the future.
+
+ 
+
+Additional
+Information
+
+ 
+
+Additional
+information about us can be obtained from the documents described under Where You Can Find More Information. 
+
+ 
+
+ 14
+
+ Table of Contents
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001301991_smartmetri_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001301991_smartmetri_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..8df96d01d87b5b1a293af581db01754757b8a75e
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001301991_smartmetri_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights selected information that is presented in greater detail elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should read this entire prospectus carefully, including the sections titled Risk Factors, Cautionary Note Regarding Forward-Looking Statements, Management s Discussion and Analysis of Financial Condition and Results of Operations, and our consolidated financial statements and the related notes included elsewhere in this prospectus, before making an investment decision.. In this prospectus, unless the context indicates otherwise, SmartMetric the Company, we, us, and our refer to SmartMetric, Inc., a Nevada corporation. Overview Corporate History and Business Overview SmartMetric, Inc. ( SmartMetric or the Company ) is a company that was incorporated pursuant to the laws of Nevada on December 18, 2002 and is engaged in the biometric technology manufacturing industry. SmartMetric has an issued patent covering technology that involves connection to networks using data cards (smart cards and Europay, MasterCard, and Visa ( EMV ) cards). In addition, SmartMetric holds the sole license to patents covering features of its biometric fingerprint activated cards. SmartMetric s main product is a fingerprint sensor activated payments card for use in the credit/debit card industry. The SmartMetric fingerprint biometric card has a rechargeable battery allowing for portable biometric identification and card activation prior to being presented to or inserted in, a credit/debit card reader. These cards are herein sometimes referred to as a biometric card or the SmartMetric Biometric card. The Market for Biometric Credit Cards Estimated Market Size The estimated size of the market for biometric credit/debit cards is significant. While the company is not making any projections on the actual size of the market a number of industry figures point to the outsized market size and potential. According to EMVCo which is a credit card standards body responsible for the licensing and rules governing EMV chips used on today s credit/debit cards, more than 10 billion EMV chip cards have been issued by banks globally. SmartMetric retained AYTM, an independent consumer market research company, to ascertain the potential consumer demand for a credit card with incorporated fingerprint biometrics. The survey was conducted in the USA and the respondents were credit card users. The result of the consumer research survey is as follows. 1: Are you concerned about credit card or identity fraud? Answered Yes: 80.1% 2: Would you pay for a safer biometric secured credit card that has a built-in fingerprint reader for your protection? Answered Yes: 65.5% 3: What would you prefer to pay for a biometric fingerprint secured safer credit card? Answer 1: $69.95 onetime charge for the life of the card (3 years) 60.2%. Answer 2: $8.95 per month (includes identity theft insurance) 39.7%. Given these consumer research results and given the number of credit cards issued by banks, it is a massively large potential market that SmartMetric has developed its product for. All credit/debit cards that are to be issued by a bank must be tested and approved of by the card brand network that the card is to operate on. Visa, MasterCard, American Express and Diners brands and networks all have their own individual testing and approval procedures. The card brand that SmartMetric is working with published its biometric testing procedures in March 2021. To be compliant with those procedures SmartMetric added to its biometric card its newly invented anti spoofing live fingerprint detection technology. The SmartMetric Biometric Technology and Products SmartMetric s founder, Chaya Hendrick is the originator and inventor of various miniature biometric activated cards, including the SmartMetric biometric fingerprint activated payments card, which has embedded a fully functional fingerprint reader inside the card. The card is the size and thickness of a standard credit card. The SmartMetric biometric payments card provides for high level security for credit/debit cards by adding biometric authentication and activation to EMV chip cards in use around the world. The SmartMetric biometric payments card has been manufactured to be totally interoperable with existing EMV chip card readers, ATMs as well as banking payments infrastructure. SmartMetric has developed a rechargeable battery powered fingerprint reader that is of a scale that fits inside a standard credit/debit card. Further, the card has a surface mounted EMV chip as found on EMV banking chip cards that is activated or turned on only after a card holder s fingerprint has been scanned and verified using the SmartMetric miniature in-card biometric scanner. There are over ten (10) billion EMV chip cards used by banks around the world for credit cards, ATM cards and debit cards according to EMVCo. SmartMetric sees this existing user base as a natural market for its advanced biometric activated card technology for the credit/debit card market. In Card Fingerprint Matching and Verification The SmartMetric Biometric card incorporates a rechargeable, solid state battery. This battery is rechargeable, very thin and has been designed by SmartMetric to fit inside the SmartMetric fingerprint credit card. This battery is manufactured, according to SmartMetric s specifications, by a third party unaffiliated with the Company. Other components needed for manufacture of the SmartMetric Biometric card include, but are not limited to, sensors, microchips, memory chips and processor chips. The ultra-thin circuit board developed by SmartMetric has multiple active and passive components. The supply of memory processors and passive components may be interrupted at any time based on global supply/demand issues. The SmartMetric Biometric card has been designed to offer the option of a built-in radio frequency transmitter for contactless access and identity verification ( RFID ). The RFID contactless chip transmission is turned on using the card users fingerprint verification. The thinness form factor of many of the components, has also resulted in the Company having to develop its own process for high volume electronic assembly. Further, the Company has also developed a process to encapsulate the electronics in plastic to create a credit card sized biometric fingerprint activated card. Standard credit card manufacturing utilizes machines that require high pressure and high temperature in fusing top and bottom sheets of plastic together thereby encasing any electronics inside the card. Given the complexity of the card s electronics and vulnerability to an assembly process involving high heat and high pressure, damage to the electronic circuitry was a major challenge for the Company to overcome. Research and development allowed us to overcome this challenge through a trade secret process that protects the silicon and internal battery that is mounted directly onto the card s internal electronics circuit board. Biometrics Biometric technologies identify users by electronically capturing a specific biological or behavioral characteristic of that individual, such as a fingerprint or voice or facial feature, and creating a unique digital identifier from that characteristic. Because this process relies on largely unalterable human characteristics, positive identification can be achieved independent of any information possessed by the individual seeking authorization. The process of identity authentication typically requires that a person be present for comparison with one or more of the following factors: Something known such as a password, PIN or mother s maiden name; Something carried such as a token, card, or key; or Something physical such as fingerprint, voice pattern, signature motion, facial shape or other biological or behavioral characteristic. Comparison of biological and behavioral characteristics has historically been the most reliable and accurate of the three factors but has also been the most difficult and costly to implement into a single product that can automatically verify the identity of a user accessing a computer network or the Internet. However, recent advances in biometric collection technologies (both biometric hardware products and their associated processing software) have increased the speed and accuracy and reduced the cost of implementing biometrics in commercial environments. Management believes that individuals, website operators, government organizations, and businesses will increasingly use this method of identity authentication. Biometrics refers to the automatic identification of a person based on his/her physiological or behavioral characteristics. This method of identification is preferred over traditional methods involving passwords and personal identification numbers ( PINs ) for two reasons: (i) the person to be identified is required to be physically present at the point of identification to be identification; and (ii) identification based on biometric techniques obviates the need to remember a password or carry a token. By replacing PINs, biometric techniques can potentially prevent unauthorized access to or fraudulent use of cellular phones, Biometric cards, desktop PCs, workstations and computer networks. It can be used during transactions conducted via telephone and Internet (e-commerce and e-banking). In automobiles, biometrics could replace keys-less entry devices. The SmartMetric fingerprint activated credit card has been developed to replace the less secure PIN s for credit/debit cards. PINs and passwords may be forgotten, may be hacked and token-based methods of identification, e.g., passports and driver s licenses, may be forged, stolen or lost. Various types of biometric systems are being used for real-time identification, with the most popular based on facial recognition and fingerprint matching. Other biometric systems utilize iris and retinal scanning, speech, facial thermograms and hand geometry. Of the biometric options available to work with a credit/debit card, fingerprint scanning is the only biometric methodology that has been successfully reduced in size to fit inside such cards. A biometric system is essentially a pattern recognition system, which makes a personal identification by determining the authenticity of a specific physiological or behavioral characteristic possessed by the user. An important issue in designing a practical system is to determine how an individual is identified. There are two different ways to resolve a person s identity; verification and identification. Verification (Am I whom I claim I am?) involves confirming or denying a person s claimed identity. In identification, one has to establish a person s identity (Who am I?). As stated above, the SmartMetric fingerprint biometric card has been designed as a credit-card sized card embedded with an integrated circuit, contact chip and biometric fingerprint sensor. The SmartMetric card has been designed to provide not only memory capacity, but also computational capability along with secure non-refutable identification of the user. We believe that the self-containment of SmartMetric s card makes it substantially resistant to attack, as it will not need to depend upon vulnerable external resources. Because of this characteristic, we expect that the SmartMetric Biometric card may be used in different applications, which require strong security protection and authentication. The physical structure of a card is specified by the International Standards Organization ( ISO ). Generally, this structure is made up of three elements: (i) the plastic card, which is the most basic one and has the dimensions of 85.60mm x 53.98 x 0.80mm; (ii) an electronic circuit board inlay; and (iii) a contact chip. The electronic circuit board inlay and the contact chip are embedded in the card. The SmartMetric Biometric card has been designed to conform to ISO standards. The electronic circuit inlay is a part of, and not distinct from, the biometric card. The communication line between the card and ATMs and other standard smart card reading devices is bi-directional serial transmission, which conforms to ISO standards. Card commands and input data are sent to the chip that responds with status words and output data upon the receipt of these commands and data. Information is sent in half duplex mode (transmission of data is in one direction at a time). This protocol, together with the restriction of the bit rate, is designed to prevent data attack on the card. Additional, data protection systems are utilized inside the card including advanced encryption. In general, the size, the thickness and bend requirements for the biometric card were designed to protect the card from being spoiled physically. Recent Developments COVID-19 has had an impact on SmartMetric s final card production. While the delays are due to supply line disruption, the Company is confident that these delays will be short-lived based on advice from our manufacturing partners, manufacturing alternatives and alternative supply lines that are being put into place by the Company. SmartMetric has presented its fingerprint activated biometric card to a large global payments network and credit/debit card brand. The company has been advised that the card testing and approval requirements for this network is that the company s biometric fingerprint scanning must be able to differentiate between a live finger and a fake finger at the time of fingerprint scanning. This is to protect the card from what is called in the industry, spoofing. The adopted method for this kind of anti-spoofing detection within the biometric industry is performed through intelligent software analysis done at the time of the fingerprint scan. SmartMetric has tested this methodology and was not confident in its robustness in performing the task at hand. So as to ensure the highest level of anti-spoofing capability, SmartMetric has developed its own method that it believes is far in advance to the normal standard within the biometric industry. SmartMetric has completed the invention of its advanced live finger detection method and is now working on its incorporation into the company s biometric card. Once this has been completed the company will then be presenting its card for testing as a biometric card to the global payments network. SmartMetric has received a license from this network to move forward with its product testing by the networks designated biometric card test laboratory. The company s product is different from most other biometric cards that have been announced in that it has its own internal rechargeable battery. This is important and a must if the card is to be used at ATM s. Other differentiations are the now newly developed advanced anti-spoofing technology. Various versions of the SmartMetric fingerprint biometric card are under development including but not limited to a version that has one-time password (also known as OTP) display and another that has a small display for showing the cards verification value (also known as CVV). The large-scale memory fingerprint biometric protected card has potential application in the portable medical records industry as well as advanced applications in the banking and financial transaction industries. Years of research and development has gone into the miniaturization of the electronics at the core of the SmartMetric fingerprint biometric card. All of the design and electronic engineering has been undertaken by SmartMetric and is the owned property and trade secrets of the company. The card developed by SmartMetric has its own Advanced RISK Machines ( ARM ) Cortex processor along with additional memory. The user s fingerprint is stored inside the card s memory and is protected by advanced very strong elliptic curve cryptography. Sales and Marketing Upon approval by one or more major global card payments network/s SmartMetric will offer its biometric card directly to card issuing banks nationally and internationally. Manufacturing The Company designs and develops its biometric technology. Current production capacity is approximately 1,000,000 cards per month that can be substantially increased over a relatively short period of time. Intellectual Property We rely on patents, licenses, trade secrets, trademarks, copyright registrations and non-disclosure agreements to establish and protect our proprietary rights in our technologies and products. A number of patents covering critical aspects of the engineering and function of the SmartMetric Biometric card are in process ( Patents Pending ). The founder of SmartMetric, Chaya Hendrick, is the inventor of these patents, and has provided SmartMetric with an option over biometric card related Pending Patents invented by her. Some of the most recent Patents Pending have not been disclosed on The United States Patent and Trademark Office ( USPTO ) database of filed for patents and remain trade secrets within the Company. Publishing of such Patents Pending will be done in due course. Patents SmartMetric Biometric card is protected by USPTO issued patents. Additional patents are pending. Our technology is also dependent upon unpatented trade secrets. However, trade secrets are difficult to protect. In an effort to protect our trade secrets, we have a policy of requiring our employees, consultants and advisors to execute non-disclosure agreements. The principal shareholder of SmartMetric and technology inventor, Chaya Hendrick, through various corporate investment vehicles and companies also owns other technologies, patents, and has financial interest in other technology companies. Chaya Hendrick, under an executed employment agreement is not subject to any restriction on using and owning any technology, methodology, process or invention created by Chaya Hendrick. Government Regulation There are currently no governmental regulations, which have any bearing on the raw materials or the manufacturing of our payments card products. United States federal departments such as the Department of Defense have rules and regulations concerning security features of smart cards used as identity or building and cyber access cards. These regulations stipulate a specific licensing and testing protocol for such cards. Banking Industry Self-Regulation The EMV chip used in chip cards are subject to licensing and testing by the banking-controlled body called EMVCo. EMVCo is an acronym standing for Europay, MasterCard and Visa. These international payments card networks were the founding parties of EMVCo. Individual payments networks such as Visa, MasterCard, Europay, American Express, Union Pay Dinners and JCB all have their own individual licensing and testing standards and processes. Research and Development Our research and development program is focused on ongoing development of new products built on our existing biometric card. We continue to refine our technology and develop further improvements to our biometric card products. Research and development will continue as the Company continues to innovate and develop new biometric card-based products. While the Company is initially focusing on the SmartMetric Biometric card, after its launch the Company will pursue additional biometric card-based products such as: (a) a health insurance card with stored in-card medical records; (b) a national identity card; and (c) drivers licenses. The Company has developed and is continuing to develop its own embedded systems and application software that works with the SmartMetric Biometric card. This development software and systems and ongoing electronic design and development requires the company to continue to expend time and financial resources on significant software development. Currently, the Company has electronic and software engineers working in Tel Aviv, Israel and Buenos Aires, Argentina. Competition Various potential competitors have announced products similar to that of SmartMetric s. Unlike the SmartMetric Biometric card that is powered from its own internal rechargeable battery, this other type of card does not allow the card to be used in most restaurants that need to take the card away from the table for processing at the checkout. It also does not allow their other type of card to be used at the vast majority of ATM s. Employees As of the date of this registration statement, we have one full time employee, our Chief Executive Officer and President, Chaya Hendrick. We primarily use direct contract hires in administration and engineering, as is common in the information technology world. All work product developed by all of our engineers remains the intellectual property of SmartMetric. Engineers who work for SmartMetric under contract are primarily based in Tel Aviv, Israel. Some software engineering is conducted in Buenos Aires, Argentina. Issuance of Commitment Shares, Notes and Warrants to Three Investors On January 27, 2022, we entered into separate securities purchase agreements with three investors, for the sale and issuance to each investor of: (i) a promissory note in the aggregate principal amount of $250,000, (ii) a common stock purchase warrant to purchase 12,500,000 shares of the Company s common stock, and (iii) a commitment fee in the form of 12,500,000 shares of the Company s common stock. Mast Hill Equity Purchase Agreement and Registration Rights Agreement to Mast Hill Fund, L.P. On March 8, 2022, we entered into an equity purchase agreement with Mast Hill Fund, L.P. ( Mast Hill ), pursuant to which, upon the terms and subject to the conditions thereof, Mast Hill is committed to purchase, shares of our common stock at an aggregate price of up to $5,000,000 over the course of its term. Additionally, in connection with the execution of the equity purchase agreement, the Company issued Mast Hill five (5) common stock purchase warrants, respectively, for the purchase of (i) 500,000 shares of common stock, (ii) 1,000,000 shares of common stock, (iii) 1,000,000 shares of common stock, (iv) 2,500,000 shares of common stock, and (v) 62,500,000 shares of the Company s common stock at the Exercise Price (as such term is defined in each warrant) per share then in effect. The Company also entered into a registration rights agreement whereby the Company shall (i) file with the United States Securities and Exchange Commission (the SEC ) a registration statement within forty-five (45) days of the date of such agreement; and (ii) have the registration statement declared effective by the Commission within ninety (90) days after the date the registration statement is filed with the SEC (or at the earliest possible date if prior to ninety (90) calendar days from the date hereof), and any amendment declared effective by the SEC at the earliest possible date. Issuance of Commitment Shares, Note, and Warrant to Mast Hill Fund, L.P. On March 15, 2022, we entered into a securities purchase agreement with Mast Hill Fund, L.P. (the Mast Hill ) with respect to the sale and issuance to the Mast Hill of: (i) a promissory note in the aggregate principal amount of $250,000, (ii) a common stock purchase warrant to purchase up to an aggregate of 12,500,000 shares of the Company s common stock, and (iii) 12,500,000 shares of common stock. Where to Find More Information We make our public filings with the SEC, including our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and all exhibits and amendments to these reports. These materials are available on the Company s website at www.smartmetric.com or on the SEC s web site, http://www.sec.gov. Summary of the Offering Shares currently outstanding: 616,351,592 Shares being offered: 30,000,000 Shares to be outstanding after the offering 646,351,592 Shares to Offering Price per share: The Selling Stockholder may sell all or a portion of the shares being offered pursuant to this prospectus at fixed prices and prevailing market prices at the time of sale, at varying prices or at negotiated prices. Use of Proceeds: We will not receive any proceeds from the sale of the shares of our common stock by the Selling Stockholder. Trading Symbol: SMME
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+PROSPECTUS SUMMARY THIS SUMMARY IS QUALIFIED BY THE MORE DETAILED INFORMATION APPEARING ELSEWHERE IN THIS PROSPECTUS. We plan to cultivate, manufacture and sell cannabis products for distribution through a network of company owned dispensaries or through third-party dispensaries. We are dedicated to creating high quality cannabis at a low cost.
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+Prospectus Summary 1
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+Prospectus Summary 1
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY 1
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+Prospectus Summary 1
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY 1
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+Prospectus Summary 1
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+SUMMARY OF THE PROSPECTUS
+
+ This summary highlights selected information from this prospectus and does not contain all of the information that is important to you in making an investment decision. This summary is qualified in its entirety by the more detailed information included in this prospectus. Before making your investment decision with respect to our securities, you should carefully read this entire prospectus, including the information under Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations, Unaudited Pro Forma Condensed Combined Financial Information and Other Data and the financial statements included elsewhere in this prospectus.
+
+ The Company
+
+ Founded in 2016 and led by Chief Executive Officer, Dr. Jun Pei and Chief Technology Officer, Dr. Mark McCord. Cepton is focused on the mass market commercialization of high performance, high quality lidar solutions and has been awarded the largest known advanced driver assistance systems ( ADAS ) lidar series production award in the industry to date, based on number of vehicle models awarded, by OEM-B (as defined below). Cepton s lidar solutions offer high performance and auto-grade reliability at competitive prices for a range of markets, such as Automotive and Smart Infrastructure. Cepton s patented Micro Motion Technology ( MMT )-based lidar technology enables reliable, high performance, low power, and compact solutions that deliver long range, high resolution 3D perception for smart applications. Cepton is headquartered in San Jose, California, with a sales and marketing presence in North America, Europe, Japan, India and China, to serve a fast-growing global customer base.
+
+ The mailing address of Cepton s principal executive office is 399 West Trimble Road, San Jose, California 95131, and its telephone number is (408) 459-7579.
+
+ For more information about Cepton, see the sections entitled Business and Management s Discussion and Analysis of Financial Condition and Results of Operation. 
+
+ Emerging Growth Company
+
+ We are an emerging growth company, as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile.
+
+ We will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) ending December 31, 2026, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the end of the prior fiscal year s second fiscal quarter; and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act.
+
+ Smaller Reporting Company
+
+ Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (i) the market value of our common stock held by non-affiliates exceeds $250 million as of the prior June 30, or (ii) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as of the prior June 30.
+
+ 
+
+ 5
+
+ Table of Contents
+
+ 
+ Risk Factors Summary
+
+ You should consider all the information contained in this prospectus before making a decision to invest in our common stock or warrants. In particular, you should consider the risk factors described under Risk Factors beginning on page 9. Such risks include, but are not limited to, the following risks:
+
+ Risks Related to This Offering
+
+ The sale or issuance of our common stock to Lincoln Park may cause dilution and the sale of the shares of common stock by Lincoln Park that it acquires pursuant to the Purchase Agreement, or the perception that such sales may occur, could cause the price of our common stock to decrease.
+
+ Risks Related to Our Business and Industry
+
+ We are an early stage company with a history of losses and expect to incur significant expenses and continuing losses for the foreseeable future.
+
+ Our limited operating history makes it difficult to evaluate our future prospects and the risks and challenges we may encounter.
+
+ Our forecasts and projections are based upon assumptions, analyses and internal estimates developed by our management. If these assumptions, analyses or estimates prove to be incorrect or inaccurate, our actual operating results may differ materially from those forecasted or projected.
+
+ We continue to implement strategic initiatives designed to grow our business. These initiatives may prove more costly than we currently anticipate and we may not succeed in increasing our revenue in an amount sufficient to offset the costs of these initiatives and to achieve and maintain profitability.
+
+ If our lidar products are not selected for inclusion in ADAS and autonomous driving systems by automotive OEMs, automotive tier 1 suppliers, mobility or technology companies or their respective suppliers, our business will be materially and adversely affected.
+
+ Continued pricing pressures, automotive OEM cost reduction initiatives and the ability of automotive OEMs to re-source or cancel vehicle or technology programs may result in losses or lower than anticipated margins, which will adversely affect our results of operations and financial condition.
+
+ Although we believe that lidar is likely to become an essential sensor for autonomous vehicles and other emerging markets, market adoption of lidar is uncertain. If market adoption of lidar does not continue to develop, or develops more slowly than we expect, our business will be adversely affected.
+
+ We are substantially dependent on our series production award from OEM-B and our relationship with Koito, and our business and prospects will be materially and adversely affected if OEM-B s development or launch plans for the multiple vehicle models in which our products are expected to be deployed are significantly scaled back or terminated.
+
+ We rely on third-party suppliers and because some of the raw materials and key components in our products come from limited or single-source suppliers, we are susceptible to supply shortages, long lead times for components, and supply changes, any of which could disrupt our supply chain and could delay deliveries of our products to customers.
+
+ Because our sales have been primarily to customers engaged in development of ADAS deployments in consumer vehicles and pilot projects in the Smart Infrastructure segment and our orders are project-based, we expect our results of operations to fluctuate on a quarterly and annual basis.
+
+ Even though many of the components in our lidars are modular and can be built using readily available materials, we, our outsourcing partners and our suppliers may rely on complex machinery for our production, which involves a significant degree of risk and uncertainty in terms of operational performance and costs. We, our outsourcing partners and our suppliers may also rely on highly-skilled labor for our production, and if such highly-skilled labor is unavailable, our business could be adversely affected.
+
+ 
+
+ 6
+
+ Table of Contents
+
+ 
+ The average selling prices of our products could decrease rapidly over the life of the product, which may negatively affect our revenue and gross margin. In addition, the selling prices we are able to ultimately charge in the future for the products we are currently developing or commercializing may be less than what we currently project, which may cause our actual operating results to differ materially from our projections.
+
+ The discontinuation, lack of commercial success, or loss of business with respect to a particular vehicle model or other customer solution for which we are a significant supplier to, could reduce our sales and adversely affect our profitability.
+
+ We have identified a material weakness in our internal control over financial reporting. If our remediation of this material weakness is not effective, or if we experience additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls in the future, we may not be able to accurately or timely report our financial condition or results of operations, which may adversely affect investor confidence in us and, as a result, the value of our common stock.
+
+ Legal and Regulatory Risks Related to Our Business
+
+ We are subject to governmental export and import control laws and regulations. Our failure to comply with these laws and regulations could have an adverse effect on our business, prospects, financial condition and results of operations.
+
+ We are subject to, and must remain in compliance with, numerous laws and governmental regulations across various jurisdictions concerning the manufacturing, use, distribution and sale of our products. Some of our customers also require that we comply with their own unique requirements relating to these matters. These could impose substantial costs upon us and materially impact our ability to fulfil certain business opportunities.
+
+ Risks Related to Our Intellectual Property
+
+ Despite the actions we are taking to defend and protect our intellectual property, we may not be able to adequately protect or enforce our intellectual property rights or prevent unauthorized parties from copying or reverse engineering our solutions. Our efforts to protect and enforce our intellectual property rights and prevent third parties from violating our rights may be costly.
+
+ Risks Related to Ownership of Our Shares and Warrants
+
+ The Amended and Restated Charter requires, to the fullest extent permitted by law, that derivative actions brought in our name against our respective directors, officers, other employees or stockholders for breach of fiduciary duty and other similar actions may be brought only in the Court of Chancery in the State of Delaware, which may have the effect of discouraging lawsuits against our directors, officers, other employees or stockholders.
+
+ Anti-takeover provisions contained in the Amended and Restated Charter and the Bylaws, as well as provisions of Delaware law, could impair a takeover attempt.
+
+ Claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and may reduce the amount of money available to us.
+
+ Future sales, or the perception of future sales, by us or our stockholders in the public market could cause the market price for the common stock to decline.
+
+ 
+
+ 7
+
+ Table of Contents
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001499785_tengjun_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001499785_tengjun_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..d4d5fadcfa1edc7b84197279a8d02f553e072860
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001499785_tengjun_prospectus_summary.txt
@@ -0,0 +1 @@
+in the Prospectus Summary. Investors in our Common Stock should be aware that they are not permitted to directly hold equity interests in the Chinese operating entities, Shandong Tengjunxiang and Jinxiang County Kanglong Water Purification Equipment Co., Ltd. ( KL Water ). Investors can only purchase equity solely in Tengjun, our Nevada corporation, which indirectly owns majority equity interests in the subsidiaries as described in details below. In addition, as we are based in and having significant of our operations in China, we are subject to legal and operational risks associated with having substantially all of our operations in China, including risks related to the legal, political and economic policies of the Chinese government, the relations between China and the United States, and changes in Chinese laws and regulations, which could result in a material change in our operations and/or cause the value of our shares to significantly decline or become worthless and affect our ability to offer or continue to offer securities to investors. Recently, the PRC government initiated a series of regulatory actions and made a number of public statements on the regulation of business operations in China with little advance notice, including cracking down on illegal activities in the securities market, enhancing supervision over China-based companies listed overseas, adopting new measures to extend the scope of cybersecurity reviews, and expanding efforts in anti-monopoly enforcement. On December 28, 2021, thirteen governmental departments of the PRC, including the Cyberspace Administration of China (the CAC ), issued the Cybersecurity Review Measures, which became effective on February 15, 2022. The Cybersecurity Review Measures provide that an online platform operator, which possesses personal information of at least one million users, must apply for a cybersecurity review by the CAC if it intends to be listed in foreign countries. Because our current operations do not possess personal information from more than one million users at this moment, we do not believe that we are subject to the cybersecurity review by the CAC. In addition, as of the date of this prospectus, we have not been involved in any investigations on cybersecurity review initiated by any PRC regulatory authority, nor have we received any inquiry, notice, or sanction related to cybersecurity review under the Cybersecurity Review Measures. As of the date of this prospectus, no relevant laws or regulations in the PRC explicitly require us to seek approval from the China Securities Regulatory Commission (the CSRC ) or any other PRC governmental authorities for our overseas securities offering plan, nor have we received any inquiry, notice, warning or sanctions regarding our planned offering from the CSRC or any other PRC governmental authorities. Also as of the date of this prospectus, we do not believe we are in a monopolistic position in the consumer retail industry. In summary, the recent statements and regulatory actions by China s government related to the data security or antimonopoly concerns, have not affected our ability to conduct our business, accept foreign investments, or being quoted by the OTCQB. However, since these statements and regulatory actions by the PRC government are newly published and official guidance and related implementation rules have not been issued, it is highly uncertain what the potential impact such modified or new laws and regulations will have on our daily business operation, the ability to accept foreign investments and trading our shares of Common stock on the OTCQB. The Standing Committee of the National People s Congress (the SCNPC ) or other PRC regulatory authorities may in the future promulgate laws, regulations or implementing rules that would require Tengjun or any of its subsidiaries to obtain regulatory approval from Chinese authorities before consummation of this offering in the U.S. and China. See Risk Factors - Risks Relating to Doing Business in China and Risk Factors - Risks Related to Our Common stock and This Offering. Our shares of Common stock may be prohibited from trading on a national exchange or over-the-counter markets under the Holding Foreign Companies Accountable Act (the HFCAA ) if the Public Company Accounting Oversight Board ( PCAOB ) determines that it is unable to inspect or fully investigate our auditor and as a result the exchange where our securities are traded may delist our securities. Furthermore, on June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act (the AHFCAA ), which, if signed into law, would amend the HFCAA and require the SEC to prohibit an issuer s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three consecutive years. Pursuant to the HFCAA, the PCAOB issued a Determination Report on December 16, 2021, which found that the PCAOB was unable to inspect or investigate completely certain named registered public accounting firms headquartered in mainland China and Hong Kong. On August 26, 2022, the SEC issued a statement announcing that the PCAOB signed a Statement of Protocol with the CSRC and the Ministry of Finance of the People s Republic of China governing inspections and investigations of audit firms based in China and Hong Kong, jointly agreeing on the need for a framework. Our independent registered public accounting firm is headquartered in the State of California and has been inspected by the PCAOB on a regular basis and as such, it is not affected by or subject to the PCAOB s Determination Report. Notwithstanding the foregoing, in the future, if there is any regulatory change or step taken by PRC regulators that does not permit our auditor to provide audit documentations located in China or Hong Kong to the PCAOB for inspection or investigation, you may be deprived of the benefits of such inspection which could result in limitation or restriction to our access to the U.S. capital markets and trading of our securities, including trading on the national exchange and trading on over-the-counter markets, may be prohibited under the HFCAA . See Risk Factors - Risks Relating to Doing Business in China. Tengjun is not a Chinese operating company but a holding company incorporated in the Nevada. This is an offering of shares of common stock of Tengjun. You are not investing in any of Tengjun s subsidiaries. Tengjun and the Company refers to Tengjun Biotechnology Corp., a Nevada corporation. Tengjunxiang Cayman or TJX refers to Tengjunxiang Biotechnology Ltd., a Cayman Island company. Tengjunxiang HK refers to Tengjunxiang Biotechnology HK Ltd., a company formed under the laws of Hong Kong. Shandong Minfu or WFOE refers to Shandong Minfu Biotechnology Co. Ltd., a company formed under the PRC laws. Shandong Tengjunxiang refers to Shandong Tengjunxiang Biotechnology Co. Ltd., a China corporation. KL Water refers to Jinxiang County Kanglong Water Purification Equipment Co. Ltd., a company formed under the PRC laws. PRC Subsidiaries refers to Shandong Minfu or WFOE, Shandong Tengjunxiang, and KL Water. Subsidiaries refers to Tengjunxiang Cayman or TJX, Tengjunxiang HK, Shandong Minfu or WFOE, Shandong Tengjunxiang, and KL Water. You should read this prospectus, together with additional information described under the headings Incorporation of Certain Information by Reference and Where You Can Find More Information , carefully before you invest in any of our securities. Our Common stock is presently quoted on the OTCQB tier of the OTC Markets under the symbol TJBH, and has had limited trading to date. Investing in our securities is highly speculative and involves a high degree of risk. See Risk Factors beginning on page 14 of this prospectus for a discussion of information that should be considered in connection with an investment in our securities. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. The date of this prospectus is October 27, 2022 TABLE OF CONTENTS GENERAL MATTERS ii TRADEMARKS iii USE OF MARKET AND INDUSTRY DATA iii PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001510832_biopower_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001510832_biopower_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a9fd5b01af3fa4391c49d0784708d8a6b39563bb
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001510832_biopower_prospectus_summary.txt
@@ -0,0 +1,1453 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary of the prospectus highlights material information concerning our business and this offering. This summary does not contain all
+of the information that you should consider before making your investment decision. You should carefully read the entire prospectus,
+including the information presented under the section entitled Risk Factors and the financial data and related notes, before
+making an investment decision. This summary contains forward-looking statements that involve risks and uncertainties. Our actual results
+may differ significantly from future results contemplated in the forward-looking statements as a result of factors such as those set
+forth in Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. 
+
+ 
+
+In
+this prospectus, unless the context indicates otherwise, BioPower, BioPower Operations, 
+ HyFi, HyFi Corp., the Company, we, our, ours or
+ us refer to BioPower Operations Corporation, a Nevada corporation, and its subsidiaries. Peak One Opportunity Fund,
+L.P. is referred to herein as Peak One or Investor and Peak One Investments, LLC is referred to
+herein as Investments, . Peak One and Investments are collectively referred to herein as the Selling Securityholders .
+
+ 
+
+This
+summary contains basic information about us and the offering. Because it is a summary, it does not contain all the information that you
+should consider before investing. You should read the entire prospectus carefully, including the risk factors and our financial statements
+and the related notes to those statements included in this prospectus.
+
+ 
+
+We
+have not authorized anyone to provide you with different information and you must not rely on any unauthorized information or representation.
+We are not making an offer to sell these securities in any jurisdiction where an offer or sale is not permitted. This document may only
+be used where it is legal to sell these securities. You should assume that the information appearing in this prospectus is accurate only
+as of the date on the front of this prospectus, regardless of the time of delivery of this prospectus, or any sale of our common stock.
+Our business, financial condition and results of operations may have changed since the date on the front of this prospectus. We urge
+you to carefully read this prospectus before deciding whether to invest in any of the common stock being offered.
+
+ 
+
+ 3
+
+ 
+
+ 
+
+ 
+
+BUSINESS
+OVERVIEW
+
+ 
+
+Overview
+
+ 
+
+BioPower
+Operations Corporation ( we, our, BioPower , or the Company ) was incorporated in
+Nevada on January 5, 2011. On January 6, 2011, the shareholders of BioPower Corporation ( BC ), which was incorporated in
+the State of Florida on September 13, 2010 and re-domiciled to Nevada on January 5, 2011, contributed their shares of BC to our Company
+and BC became a wholly owned subsidiary of our Company. BC is no longer active at this time and does not have any assets or operations.
+On June 11, 2021, the Company formed HYFI CORP, a Florida corporation, as its wholly owned subsidiary. From 2017 until February 17, 2022,
+the Company was a shell company, as such term is defined in Rule 12b-2 promulgated under the Securities Exchange Act of 1934, as amended
+(the Exchange Act ). On February 17, 2022, we commenced operations and, accordingly, we ceased to be a shell company at
+that time.
+
+ 
+
+We
+are a U.S.-based fintech company that has developed and owns an innovative hybrid Centralized and Decentralized Finance ( CeDeFi )
+blockchain technology called HyFi . The Company s primary objective is to operate a HyFi marketplace in which a wide
+variety of commercial transactions and investments can take place. The HyFi marketplace will use the Ethereum public blockchain, which
+is the largest decentralized market community and natively supports the deployment of smart contracts and decentralized applications
+( dApps ).
+
+ 
+
+We
+have created what we believe to be utility tokens called HyFi Tokens , which are different from common cryptocurrencies
+like Bitcoin. Cryptocurrency relies on a decentralized cryptographic model to facilitate verifiable transactions. Cryptocurrencies are
+designed to transfer monetary value and to be a universally acceptable currency to compete with fiat currencies like the U.S. Dollar
+or Euro. In contrast, the HyFi Token system relies on a centralized ledger that we maintain to record verifiable transactions. HyFi Tokens
+are intended to only have purpose and value on our HyFi marketplace. HyFi Tokens are not intended to become a universally accepted cryptocurrency
+or have any purpose outside of our HyFi ecosystem.
+
+ 
+
+Our
+dApps will initially consist of smart contracts; initial license offerings ( ILOs ); bridge loan offerings ( BLOs );
+pre-initial public offerings ( IPOs ); and creation and transfer of Non-Fungible Tokens ( NFTs ), which are cryptographic
+assets on a blockchain with unique identification codes and metadata that distinguish them from each other. For example, we intend to
+offer NFTs that are fractionalized pieces of unique artwork relating to the Roman Goddess Athena. Our dApps are planned to be issued
+as an ERC-20 token, which is the technical standard for fungible tokens created using the Ethereum blockchain. A fungible token is one
+that is interchangeable with another token where the well-known non-fungible tokens (NFTs) are not interchangeable. ERC-20 allows
+different smart-contract enabled tokens a way to be exchanged, like an on and off ramp. Tokens, in this regard, are a representation
+of an asset, right, ownership, access, cryptocurrency, or anything else that is not unique in and of itself but can be transferred. The
+standard allows tokens representing one of these factors along with smart contracts to be exchanged for a token that represents
+another. Smart contracts are conditions written into the coding that execute different aspects of a transaction between parties.
+
+ 
+
+We
+believe that our dApps are considered to be security tokens which are digital assets that represent transferred ownership
+rights or asset value to a blockchain token. A security token is created using tokenization, where the investment criteria are selected.
+The information is entered into the blockchain, which then creates a token. When issuing any dApps, the Company intends to seek exemption
+from registration under Section 5 of the Securities Act of 1933, as amended (the Securities Act ) pursuant to an available
+exemption either under Regulation D under the Securities Act or Regulation A under the Securities Act. The Company intends to comply
+with any current or future laws and regulations in respect of its dApps, HyFi Tokens and its NFTs.
+
+ 
+
+One
+of our goals is to make decentralized finances ( DeFi ) marketplaces accessible for issuers who register offerings with the
+SEC or comparable international regulators to offer NFT initial license offerings ( ILOs ) and bridge loan offerings ( BLOs ).
+HyFi also seeks to provide an NFT Vault (the Vaults ) offering which aims to provide a modern marketing solution to reach
+today s buyers around the world. The Vaults seek to enable HyFi Partner companies to collaborate with HyFi, or license our technology,
+to market their products and services. We believe that this unique blockchain technology marketing tool can also track distributors,
+affiliates and influencers successes and sales for the promotion and introduction of the products or services. HyFi technology may also
+allow for the transparent trading of decentralized assets like NFTs and digital assets in the future.
+
+ 
+
+ 4
+
+ 
+
+ 
+
+ 
+
+The
+HyFi platform website was launched on November 8, 2021 and is available for view and partial use at the following site: http://hyfi.exchange/.
+Information contained on, or accessible through, this website is not a part of, and is not incorporated by reference into, this Prospectus.
+Currently, the only available feature of the HyFI Platform is the HyFi Vault program which began minting NFTs in September 2022. We are
+currently developing but have not yet launched the ILO marketplace. We have a demo of the ILO marketplace on the platform website and
+intend to launch it in the fourth fiscal quarter of 2022. The HyFi Vault NFT was successfully launched and is minting NFTs as of September
+2022. The HyFi NFT Launchpad, for brands and companies, is expected to be launched in the fourth fiscal quarter of 2022.
+
+ 
+
+On
+July 28, 2021, the Company amended and restated its articles of incorporation, as amended, in order to (i) increase the number of authorized
+shares of common stock from 100,000,000 to 500,000,000, (ii) increase the number of authorized shares of preferred stock from 10,000
+to 5,000,000, (iii) change the par value of the preferred stock from $1.00 par value per share to $0.0001 par value per share; and (iv)
+increase the number of directors from one to four. Currently, the Company has authorized 500,000,000 shares of common stock, $0.0001
+par value per share, and 5,000,000 shares of preferred stock, $0.0001 par value per share.
+
+ 
+
+On
+October 7, 2021, we filed a certificate of amendment to our amended and restated articles of incorporation in order to change our corporate
+name from BioPower Operations Corporation to HyFi Corp (the Name Change ) to more closely align the Company name with our
+products and services. Although the Name Change has been effected in the State of Nevada, the Name Change and our request for a new stock
+symbol will only become effective following clearance by the Financial Industry Regulatory Authority (FINRA), which is currently still
+pending.
+
+ 
+
+For
+the year ended November 30, 2021 the Company generated revenues of $175,000, which revenue was generated by the sale of 4,125,000 HyFi
+Tokens to two customers, and reported a net loss of $441,324 and negative cash flow from operating activities of $441,324. For the six
+months ended May 31, 2022, the Company generated revenues of $246,700, reported a net loss of $13,138, and had negative cash flow from
+operating activities of $11,958. As noted in the consolidated financial statements of the Company, as of May 31, 2022, the Company had
+an accumulated deficit of $9,568,948. There is substantial doubt regarding the ability of the Company to continue as a going concern
+as a result of its historical recurring losses and negative cash flows from operations as well as its dependence on private equity and
+financings. See Risk Factors The Company has a history of operating losses, and its management has concluded that factors
+raise substantial doubt about its ability to continue as a going concern and the auditor of the Company has included explanatory paragraphs
+relating to its ability to continue as a going concern in its audit report for the years ended November 30, 2021 and 2020. 
+
+ 
+
+In
+addition to the Equity Line with Peak One, we must raise cash from sources other than revenues generated, such as from the proceeds of
+loans, public or private equity sales, and/or advances from related parties in order to continue to implement our operations for the
+next 12 months.
+
+ 
+
+HyFi
+Asset Purchase Agreement
+
+ 
+
+On
+June 29, 2021, we entered into an Asset Purchase Agreement (the APA ) with Rafael Ben Shaya, Troy MacDonald, Adam Benchaya,
+Thomas Perez, Tom Saban and Edouard Pouchoy (collectively, Messrs. Ben Shaya, MacDonald, Benchaya, Perez, Saban and Pouchoy are referred
+to herein as the Sellers ).
+
+ 
+
+Pursuant
+to the terms of the APA, the Company agreed to acquire from the Sellers, and the Sellers agreed to sell to the Company, certain assets
+comprised of the goodwill, intellectual property, business proprietary know-how and trade secrets, intangible property and other assets
+of Sellers business with respect to HyFi, and any and all rights of Sellers in and to the foregoing (the Assets ),
+and certain governance/utility virtual tokens (each, a HyFi Token and collectively, the HyFi Tokens ) expected
+to be used as a means of payment on the HyFi Platform, as hereinafter defined (the Acquisition ). The HyFi Platform 
+means a decentralized finances ( DeFi ) exchange marketplace using blockchain platform technology. The DeFi principles are
+based on an ecosystem of financial services utilizing tokenization and non-fungible tokens ( NFTs ) for production, licenses,
+projects and commodities across vertical and horizontal markets. The HyFi platform website was launched on November 8, 2021 and is available
+for view and partial use at the following site: http://hyfi.exchange/. Information contained on, or accessible through, this website
+is not a part of, and is not incorporated by reference into, this Prospectus. Currently, the only available feature of the HyFI Platform
+is the HyFi Vault program which began minting NFTs in September 2022. We are currently developing but have not yet launched the ILO marketplace.
+We have a demo of the ILO marketplace on the platform website and intend to launch it in the fourth fiscal quarter of 2022. The HyFi
+Vault NFT was successfully launched and is minting NFTs as of September 2022. The HyFi NFT Launchpad, for brands and companies, is expected
+to be launched in the fourth fiscal quarter of 2022.
+
+ 
+
+ 5
+
+ 
+
+ 
+
+ 
+
+In
+addition, the Sellers agreed to (i) pay to the Company, on the closing date of the Acquisition, $300,000 (the Cash Consideration ),
+and (ii) transfer to the Company, on the closing date of the Acquisition, 400,000,000 HyFi Tokens (the HyFi Token Consideration ).
+The Company used the Cash Consideration to bring the Company into a fully reporting status with the U.S. Securities and Exchange Commission
+and for public company operating expenses.
+
+ 
+
+Pursuant
+to the terms of the APA, the Company agreed to file and filed with the State of Nevada the certificate of designation for the Series
+C preferred stock on or before the date that is 60 calendar days after the closing of the Acquisition. In exchange for the sale of the
+Assets, the HyFi Token Consideration and the Cash Consideration, the Company agreed to issue and issued to the Sellers an aggregate of
+900,000 Series C preferred shares within 30 calendar days after the State of Nevada provided written confirmation of filing of the certificate
+of designation for the Series C preferred stock. The certificate of designation for the Series C preferred stock was filed with the State
+of Nevada, and was effective as of August 27, 2021.
+
+ 
+
+Pursuant
+to the terms of the APA, the parties agreed that the Series C preferred stock has the following terms, among others:
+
+ 
+
+ 
+ 
+ 1.
+ Authorized
+ Shares of Series C Preferred Stock. The number of authorized shares of Series C preferred stock is 900,000.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 2.
+ Conversion.
+ Subject to the other terms and conditions in the certificate of designation, a Series C preferred stockholder will have the right
+ from time to time and at any time following the date that is one year after the date on the signature page of the certificate of
+ designations to convert each outstanding share of Series C preferred stock into 450 shares of Company common stock. Based on the
+ number of shares of common stock issued and outstanding as of October 7, 2022, if all of the 900,000 shares of Series C preferred
+ stock are issued and subsequently converted, the holders of the converted stock will hold 90% of the issued and outstanding shares
+ of the Company s common stock.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 3.
+ Voting.
+ Except as otherwise set forth in the certificate of designation, each share of Series C preferred stock will, on any matter submitted
+ to the holders of Company common stock, or any class thereof, for a vote, vote together with the common stock, or any class thereof,
+ as applicable, as one class on such matter, and each share of Series C preferred stock will have 450 votes.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 4.
+ Dividends.
+ The Series C preferred stock is not entitled to receive dividends or distributions.
+
+ 
+ 
+
+The
+Acquisition closed on June 29, 2021 (the Closing Date ). On the Closing Date, the Sellers delivered the Cash Consideration
+and the HyFi Token Consideration.
+
+ 
+
+On
+August 27, 2021, the Company filed with the State of Nevada a certificate of designations for the Series C preferred stock.
+
+ 
+
+Series
+A Preferred Stock Redemption Agreement & Senior Promissory Note
+
+ 
+
+Also
+on the Closing Date, the Company and China Energy Partners, LLC ( CEP ) entered into a share redemption agreement (the Redemption
+Agreement ), dated as of June 29, 2021, pursuant to which the Company redeemed one share of the Company s Series A preferred
+stock from CEP (the Series A Share ). On the Closing Date, as provided in the Redemption Agreement, the Company issued to
+CEP a senior promissory note (the Note ) in the principal amount of $1,000,000. The Series A Share will be held in escrow
+by an attorney designated by CEP (the Escrow Agent ), which was designated by CEP within 30 calendar days after the Closing
+Date. If an Event of Default (as defined in the Note) occurs under the Note, then the Company will direct the Escrow Agent to release
+the Series A Share to CEP; provided, however, that CEP will also retain all rights and privileges under the Note (and the Company will
+remain bound to all obligations under Note) even if the Series A Share is required to be released by the Escrow Agent to CEP as provided
+in the Redemption Agreement. For the avoidance of doubt, CEP will regain all rights, title, and interest in and to the Series A Share
+upon the occurrence of an Event of Default under the Note, regardless of the amount of the outstanding balance owed under the Note at
+the time of the occurrence of an Event of Default under the Note.
+
+ 
+
+ 6
+
+ 
+
+ 
+
+ 
+
+As
+provided in the APA, on June 29, 2021, Robert Kohn resigned as the Company s Chief Executive Officer. Mr. Kohn remained as a member
+of the Board of Directors, however.
+
+ 
+
+Also
+on June 29, 2021, the Company appointed the following individuals to serve as members of the Board of Directors: Troy MacDonald (Chairman),
+Adam Benchaya, and Thomas Perez. As a result, following the closing of the Acquisition, the Company s Board of Directors consists
+of the following:
+
+ 
+
+Troy
+MacDonald (Chairman)
+
+Adam
+Benchaya
+
+Robert
+Kohn
+
+Thomas
+Perez
+
+ 
+
+Also
+on June 29, 2021, the following individuals were appointed to serve as officers of the Company:
+
+ 
+
+Troy
+MacDonald, Chief Executive Officer
+
+Robert
+Kohn, Chief Financial Officer
+
+Adam
+Benchaya, President and Chief Marketing Officer
+
+ 
+
+HyFi
+Platform
+
+ 
+
+We
+are a U.S.-based fintech company that has developed and owns an innovative blockchain technology called HyFi . We intend
+to license, operate and enable tokenized economies for various DeFi marketplaces. Initially HyFi is planned to be launched with two platforms,
+the first is an impact investment platform, the ILO marketplace, where NFT s are to be fractionalized. The intended
+purpose of the ILO marketplace is to solve the problem of access to funding for legally compliant issuers who have focused their business
+on sustainability and the betterment of the planet or humanity, and have owners who do not want to give up control of their companies.
+
+ 
+
+The
+second platform is an NFT launchpad, for the web and metaverse where NFT s are not fractionalized. The NFT launchpad is intended
+to be a HyFi ecosystem community building tool which is intended to cross pollinate with the investment platform through community alignment
+and it is intended that users from both platforms will have a single destination point to access both the green investment platform and
+NFT launchpad, called the hyfi.exchange. The NFT launchpad can also be licensed separately to companies and brands wanting to do an NFT
+Launch
+
+ 
+
+We
+also intend to utilize HyFi technology with our membership programs. We intend that the HyFi DeFi Marketplace will be used by client
+issuers who register offerings with the SEC or comparable regulators located overseas, to offer NFT initial license offerings ( ILOs )
+and later, bridge loan offerings ( BLOs ).
+
+ 
+
+NFTs
+are collectible digital assets in which various objects are digitized. Each NFT represents ownership of something inherently distinct
+and unique, whether it be a physical or a digital item. NFTs cannot be mutually exchanged for one another because each NFT has a specific
+value based on its unique traits and attributes. When NFTs are sold, the digital version of the object is sold as a unique, blockchain-authenticated
+collectible.
+
+ 
+
+Any
+ fractionalized interest as described hereinafter in any NFT, licensing fee or loan would be subject to
+a registered or exempt securities offering, in that such fractionalized interest would qualify as an investment contract
+similar to a security, consistent with the prevailing interpretation at issue in the U.S. Supreme Court decision found in Securities
+and Exchange Commission v. W. J. Howey Co., 328 U.S. 293 (1946), also known as the Howey Test.
+
+ 
+
+ 7
+
+ 
+
+ 
+
+ 
+
+We
+believe that the HyFi technology is also a candidate infrastructure for use in the metaverse and play-to-earn GameFi industry. HyFi technology
+is intended to allow users to securely own assets or items and move them across different platforms without the need for a central party s
+permission. The HyFi technology is expected to allow for transparent trading of decentralized assets like NFTs and other digital assets.
+The DeFi principles are based on the creation of an innovative ecosystem of financial services accessible to anyone with internet access.
+
+ 
+
+The
+HyFi Token is featured on the HyFi DeFi Marketplace used as a utility payment token for transaction fees, for membership as well as for
+purchase of the proposed Vault offerings, which are expected to be bundles of digital and non-digital assets. The HyFi DeFi Marketplace
+ecosystem is built on a combination of issuer tokens to support its economy. The HyFi DeFi Marketplace is based on the Ethereum blockchain.
+
+ 
+
+We
+are currently developing but have not yet launched the ILO marketplace, we plan to make such launch in the fourth fiscal quarter of 2022.
+The HyFi Vault NFT was successfully launched and is minting NFTs as of September 2022. The HyFi NFT Launchpad, for brands and companies,
+is expected to be launched in the fourth fiscal quarter of 2022.
+
+ 
+
+Proposed
+HyFi DeFi and CeDeFi Marketplace Types
+
+ 
+
+ 
+
+ 8
+
+ 
+
+ 
+
+ 
+
+Utilizing
+our HyFi blockchain technology, we are developing the following proposed DeFi marketplaces:
+
+ 
+
+ 
+ 
+ 1.
+ NFT
+ Marketplace for Initial License Offerings (ILOs). We intend that project developers and technology companies including renewable
+ energy, environmental, agri-food and other important markets ( Issuers ) can raise money by incentivizing investors with
+ SEC or other financial authorities registered offerings such as: (1) part of licensing fee related income or (2) project profits
+ or (3) any other Issuer offering through tokenized technology licenses and project offerings enabled by NFTs. Investors can purchase
+ the whole offering or fractional interests.
+
+ 
+ 
+ 
+
+ 
+ 2.
+ Bridge
+ Loan Offerings (BLOs) for Businesses. We intend that investors will also be able to purchase a fractionalized interest in an
+ expected income return for the BLOs. The Pre-IPO and Pre-SPAC markets are planned to be just two of the niche markets served in the
+ BLO marketplace.
+
+ 
+ 
+ 
+
+ 
+ 3.
+ NFT
+ Launchpad. We are also developing a robust NFT Launchpad for the web and metaverse as a HyFi ecosystem community building tool
+ which is intended to cross pollinate the planned investment platform with community alignment and is aimed to be a users single
+ destination point to access both the green investment platform and NFT launchpad, hyfi.exchange. It is also planned that the NFT
+ launchpad can also be licensed as a stand-alone technology by companies and brands wanting to do an NFT Launch. For example, the
+ Company granted a license to PIP North America Inc. ( PIP ) to use the NFT Launchpad in exchange for $250,000, pursuant
+ to the ILO and Multi-Agreement entered between the Company and PIP on June 26, 2022.
+
+ 
+ 
+ 
+
+ 
+ 4.
+ CeDeFi
+ Exchanges. Our initial CeDeFi exchange will focus on membership. We intend, in the future, to trade commodities and other tokens
+ using the HyFi blockchain technology and ecosystem, which will require registration with the SEC as an Alternative Trading System
+ (ATS) or as a Broker-Dealer. 
+
+ 
+ 
+ 
+
+ 
+ 5.
+ Metaverse
+ & GameFi. We intend to enable our DeFi infrastructure for use with the Metaverse and GameFi.
+
+ 
+ 
+
+We
+are currently developing but have not yet launched the ILO marketplace, we plan to make such launch in the fourth fiscal quarter of 2022.
+The HyFi Vault NFT was successfully launched and is minting NFTs as of September 2022. The HyFi NFT Launchpad, for brands and companies,
+is expected to be launched in the fourth fiscal quarter of 2022.
+
+ 
+
+Features
+of CeDeFi
+
+ 
+
+We
+believe that the features of CeDeFi are as follows:
+
+ 
+
+ Seamless
+ customer support within every KYC onboarded investor / issuer, there is an internal
+ account for managing funds. Furthermore, HyFi takes care of investor / issuer experience
+ and gives assistance to the customers through a dedicated customer support team, thus improving
+ the trust level.
+
+ 
+
+ Flexible
+ conversion the HyFi economy is intended to be very modern, supporting major traditional
+ currencies (USD/CAD/EUR/GBP/CHF/YEN) and major cryptocurrencies. Payment options are planned
+ to include: an on/off ramp for crypto transactions, wire transfers, credit and debit cards
+ (coming soon). We believe that the ease that the platforms offer, lead to greater customer
+ onboarding.
+
+ 
+
+ Centralized
+ Exchange (CEX) Using HyFi solution you can handle the capital raise through an
+ internal account and avoid blockchain transaction fees. Moreover, since the funds are on
+ the custody service provider (PrimeTrust), and they handle the management aspect.
+
+ 
+
+NFT
+ILO Marketplace
+
+ 
+
+ILO
+tokens are sub-class of tokens which are created to allow for fractional ownership of an NFT from an owner issuer that seeks to raise
+money for the development of new projects, technologies, intellectual property, licenses, brands, etc. A key distinguishing element of
+the HyFi marketplace is the fractionalization of the NFT that aggregates the investor contribution capability of many. On the HyFi Platform,
+the issuer is able to sell a percentage interest in its license in order to raise capital.
+
+ 
+
+ 9
+
+ 
+
+ 
+
+ 
+
+We
+intend that cash flow technology license NFTs will be created that will represent up to a 49% ownership interest of a technology license
+for a geographic vertical market (e.g., India) or a horizontal market (e.g., energy-solar power.) We expect that there will be a subclass
+of NFTs that represents an opportunity for many participants to have fractional ownership and participation in the unique exclusive license
+NFT. The HyFi cash flow NFT marketplace is expected to initially list companies in the agriculture, environmental, and other related
+sectors that will provide license fees from unique license fee contracts for various territories. As an example, we are currently in
+discussions with an agriculture related company that expressed a possible willingness pay licensing fees of 5% annually with a potential
+bonus based on income for its Agri production facility could list on the HyFi Platform. For illustration purposes only, we ll assume
+that said company might be willing to sell up to 49% of its ownership in that license for a speculative value of between $5,000,000 and
+$10,000,000, with a minimum investment of $50,000 from accredited investors. In such a case, HyFi may receive fixed cash fees associated
+with this transaction. The latter example is for illustration purposes only, as there can be no assurance that the parties will reach
+an agreement which would generate revenue for the Company, if there ever reach an agreement, as well as what the terms of that agreement
+would be.
+
+ 
+
+We intend to offer cash flow generating NFTs, on full or fractional ownership basis, in the following major areas as conceptualized below:
+
+ 
+
+ 
+ 
+ 
+ We
+ anticipate that NFTs may be created, representing up to a 49% ownership interest of a license to a particular geographic market (example:
+ India). There would also be a subclass of tokens that represent an opportunity for numerous participants to have fractional ownership
+ of, and participation in, the unique one-of-a-kind exclusive license NFTs. We expect that those NFTs would be tradeable on the commodities
+ section of the HyFi Platform once certain conditions have been met.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ also expect that there may be NFTs issued for qualified projects related to renewable energy, waste to energy, agricultural and other
+ approved projects showing potential and promise in their respective industry sectors.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Ownership
+ of technology licenses: We expect that NFTs may represent part or full ownership of technology licenses across many markets.
+ Each such market is expected to include horizontal and vertical markets. For example, let s assume that a given energy market
+ could include the horizontal energy markets of green hydrogen and its many uses, electric generation, biofuels for marine, aviation
+ and transportation and hydrogen fueling station networks. NFTs could also represent part or full ownership of a technology license
+ in a specific geographic territory or vertical market.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Physical
+ projects related to renewable energy, environmental, agricultural and humanitarian causes. NFTs could be issued to represent
+ an opportunity to invest in projects in any of the aforementioned categories.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Other
+approved cases. In the future we may consider NFTs in the areas of medicine, space, internet & computing, artificial intelligence,
+robotics and nanotechnology, for example.
+
+ 
+ 
+
+HyFi
+also intends to introduce the ILO to investors and to a global network of brokers who are incentivized to introduce investors (institutional
+investors, corporations, family offices, private wealth and individuals) who may buy fractional interests (ILO Tokens) of the license
+offering or a total interest. There can be no assurance that any of the above market segments will materialize, produce customers or
+revenue, or that the Company will achieve profitability.
+
+ 
+
+ 10
+
+ 
+
+ 
+
+ 
+
+Bridge
+Loan Offerings (BLO) Marketplace
+
+ 
+
+We
+intend to expand the ILO NFT marketplace to include bridge loans via tokenized NFT offerings, including the following:
+
+ 
+
+ 
+ 
+ 
+ Fractional
+ ownership of loan contracts, expected to be typically high yielding
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Funds
+ to be used for construction projects related to renewable energy, environment, agriculture, new technology, medical, humanitarian
+ projects and pre-IPO companies
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Other
+ licenses and projects qualified by the Company
+
+ 
+ 
+
+ BLO
+Tokens are a sub-class of tokens created to allow for fractional ownership of a unique NFT loan contract offered by an issuer
+that seeks to borrow money for typically a short period of time for a number of critical business reasons while it is awaiting the arrival
+of expected income or capital which would be used to pay back the loan, with interest owed. It is the fractionalization of the BLO NFT
+into BLO Tokens that aggregates the funding capability.
+
+ 
+
+There
+can be no assurance that any of the above market segments will materialize, produce any customers or revenue whatsoever, or that the
+Company will achieve profitability.
+
+ 
+
+In
+addition, we expect that commodities can be traded in the future on a to-be-formed HyFi Commodities Platform which would be registered
+with applicable regulatory authorities as an ATS and/or commodity exchange.
+
+ 
+
+ 
+ 
+ 
+ We
+ expect to have an initial emphasis on agri-foods, renewable energy and waste-to-energy via tokenized futures blockchain based smart
+ contracts.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ trading of certain commodities (e.g., green hydrogen production) would occur in most cases without any physical delivery obligation,
+ and with electronic settlement only. Traders would purchase tokens to participate in the trading of those commodities. In some cases,
+ commodities could be offered with a physical delivery option.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Commodity
+ future supply contracts: A futures contract is a legal agreement to buy or sell a particular commodity asset at a predetermined
+ price at a specified time in the future. The seller of the futures contract is taking on the obligation to provide and deliver the
+ underlying commodity at the contract s expiration date. Futures contracts are available for every category of commodity. Some
+ manufacturers and service providers use futures contracts as part of their budgeting process to normalize expenses and reduce cash
+ flow-related headaches. Manufacturers and service providers that rely on commodities for their production process may take a position
+ in the commodities markets as a way of reducing their risk of financial loss due to a change in price. There are many advantages
+ to futures contracts as a method of participating in the commodities market. We believe that analysis can be easier because of the
+ underlying commodity.
+
+ 
+ 
+
+Proposed
+NFT Vault Programs
+
+ 
+
+The
+HyFi NFT Vault Program has been developed for three main purposes which are as follows: (1) demonstrate the capability and scalability
+of the HyFi NFT launchpad through the issuance of our own proprietary NFT offering (2) to create an immediate and sustainable path to
+revenue for the Company by creating a unique NFT, to be coupled with other opportunities associated with an Art collectible(s); and (3)
+accelerate user participation by providing a main entry point to become a member and begin interacting with the HyFi DeFi Marketplaces.
+
+ 
+
+The
+HyFi NFT Vault Program is the Front Door to HyFi and its DeFi marketplaces positioned as a well-rounded toolkit for all
+that is needed to interact with HyFi DeFi Marketplace, plus a bonus of an Art asset(s) collectible.
+
+ 
+
+When
+a user purchases a HyFi NFT Vault it contains an assortment of items such as:
+
+ 
+
+1)
+An Art Collectible(s) with 1 in 5 chances of getting a Premier Art Collectible*;
+
+ 
+
+2)
+A Pro or Ultimate Lifetime HyFi Membership - 1 in 5 chances of getting an Ultimate Lifetime Membership and 4 in 5 chances of getting
+a 2-year Pro Membership;
+
+ 
+
+ 11
+
+ 
+
+ 
+
+ 
+
+3)
+Gift Vouchers, to be used in the marketplaces or subsequent HyFi NFT Vault purchases;
+
+ 
+
+4)
+HyFi Tokens to be used for further purchases of HyFi NFT Vaults, membership items and in the marketplaces; and
+
+ 
+
+5)
+In 200 out of 100,000 Vaults a real physical .9999 Gold 5 oz. Athena Coin or a real physical gemstone (in 100 vaults each)
+
+ 
+
+*Art
+Assets/ Collectibles/ Art Items. (The inclusion of the Art assets should qualify the Vault to be listed on various Art focused NFT marketplaces
+such as OpenSea)
+
+ 
+
+We
+intend to sell the HyFi NFT Vaults to individuals and businesses. Various businesses have approached the Company to use our HyFi Vaults
+and put some of their gaming, collectibles and promotional items in the HyFi NFT Vault. We have not entered into any agreements with
+such businesses and there can be no assurance that we ll be able to do so on terms acceptable to us, or at all.
+
+ 
+
+We
+expect variances in the types of assets/ items being offered in the potential various HyFi NFT Vault Programs. There can be no assurance
+any further Vault programs will be launched after the first HyFi NFT Vault.
+
+ 
+
+HyFi
+also intends to license its Vault Program technology to companies for promoting their own brands, products and services.
+
+ 
+
+Proposed
+Membership Plan
+
+ 
+
+We
+have finalized a Membership Program which we intend will enable members to earn money from referrals of companies and individuals to
+our DeFi Marketplace, as well as referral fee income for introducing other members. Members may also receive discounts for HyFi packaged
+financial products and tokens. HyFi Tokens will be able to be used for any payments defined by each product or service.
+
+ 
+
+Corporate
+History
+
+ 
+
+The
+Company was incorporated in Nevada on January 5, 2011.
+
+ 
+
+On
+January 6, 2011, we acquired 100% of BC, a Florida corporation incorporated on September 13, 2010, by our then-CEO and Director contributing
+100% of the outstanding shares to the Company. As a result, BC became a wholly owned subsidiary of the Company.
+
+ 
+
+BC
+is no longer active at this time and does not have any assets or operations. On June 11, 2021, the Company formed HYFI CORP, a Florida
+corporation, as its wholly owned subsidiary.
+
+ 
+
+On
+May 12, 2012, the Company formed FTZ Energy Exchange Inc., a wholly owned subsidiary, for the future development of an energy exchange.
+On June 7, 2012, the Company s then-Chief Executive Officer contributed 100% of his member interest in FTZ Exchange, LLC ( FTZ ),
+a wholly owned subsidiary, to the Company for no consideration. FTZ is a licensing company that licenses business know-how and technology
+to build transaction fee-based exchanges for the sale of products and services in vertical markets.
+
+ 
+
+On
+August 2, 2012, the Company formed Agribopo, Inc., a wholly owned subsidiary for the development of biomass related projects. On November
+27, 2012, the Company entered into a non-exclusive global license with Advanced Green Technologies, LLC to convert biomass wastes from
+animals, humans and cellulosic biomass to cellulosic ethanol, fertilizer and other derivative products.
+
+ 
+
+On
+October 24, 2014, the Company entered into a Share Exchange Agreement (the Exchange Agreement ) with Green3Power
+Holdings Company ( G3P ) to acquire G3P and its wholly owned subsidiaries, Green3Power Operations
+Inc. ( G3P OPS ) and Green3Power International Company ( G3PI ) through a stock-for-stock
+exchange (the Exchange ). Following entry into the Exchange Agreement, we conducted all of our operations, which primarily
+consisted of the development of waste-to-energy projects and services, including design, permitting, equipment procurement, construction
+management, operation of the intended facilities and maintenance of such facilities, through G3P.
+
+ 
+
+ 12
+
+ 
+
+ 
+
+ 
+
+By
+October 24, 2016, G3P had failed to meet the provisions of the Exchange Agreement that would allow G3P to take
+over control of the Company. As a result, the Company s Board of Directors tried to come to an arrangement to separate BioPower
+from its subsidiaries, but in the end, decided that it would be in the best interests of the Company s shareholders to move forward
+looking for a new acquisition. From October 24, 2016 until February 2017, the Company continued project development of waste-to-energy
+projects with extremely limited funds. In February 2017, the Company ceased all operations. At that time, we became a shell company.
+
+ 
+
+In
+2019, we entered into a memorandum of understanding with WPP Energy GmbH and China Energy Partners, but after exhausting all efforts
+we were unable to negotiate a definitive agreement or close the transaction.
+
+ 
+
+On
+July 28, 2021, the Company amended and restated its articles of incorporation, as amended, in order to (i) increase the number of authorized
+shares of common stock from 100,000,000 to 500,000,000, (ii) increase the number of authorized shares of preferred stock from 10,000
+to 5,000,000, (iii) change the par value of the preferred stock from $1.00 par value per share to $0.0001 par value per share; and (iv)
+increase the number of directors from one to four. Currently, the Company has authorized 500,000,000 shares of common stock, $0.0001
+par value per share, and 5,000,000 shares of preferred stock, $0.0001 par value per share.
+
+ 
+
+On
+October 7, 2021, we filed a certificate of amendment to our amended and restated articles of incorporation in order to change our corporate
+name from BioPower Operations Corporation to HyFi Corp (the Name Change ) to more closely align the Company name with our
+products and services. Although the Name Change has been effected in the State of Nevada, the Name Change and our request for a new stock
+symbol will only become effective following clearance by the Financial Industry Regulatory Authority (FINRA), which is currently still
+pending.
+
+ 
+
+During
+the quarter ending February 28, 2022, we commenced operations and accordingly, we ceased to be a shell company.
+
+ 
+
+Going
+Concern
+
+ 
+
+For
+the year ended November 30, 2021 the Company generated revenues of $175,000 and reported a net loss of $441,324 and negative cash flow
+from operating activities of $441,324. For the six months ended May 31, 2022, the Company generated revenues of $246,700, reported a
+net loss of $13,138, and had negative cash flow from operating activities of $11,958. As noted in the consolidated financial statements
+of the Company, as of May 31, 2022, the Company had an accumulated deficit of $9,568,948. There is substantial doubt regarding the ability
+of the Company to continue as a going concern as a result of its historical recurring losses and negative cash flows from operations
+as well as its dependence on private equity and financings. See Risk Factors The Company has a history of operating losses,
+and its management has concluded that factors raise substantial doubt about its ability to continue as a going concern and the auditor
+of the Company has included explanatory paragraphs relating to its ability to continue as a going concern in its audit report for the
+years ended November 30, 2021 and 2020. 
+
+ 
+
+Our
+unaudited financial statements have been prepared assuming that we will continue as a going concern, which contemplates the realization
+of assets and liquidation of liabilities in the normal course of business. The unaudited financial statements do not include any adjustments
+that might result from the outcome of this uncertainty. We have a minimal operating history and minimal revenues or earnings from operations.
+We have no significant assets or financial resources. We will, in all likelihood, sustain operating expenses without corresponding revenues
+for the immediate future.
+
+ 
+
+There
+is substantial doubt that we can continue as an ongoing business for the next 12 months unless we obtain additional capital to pay our
+expenses. We must raise cash from sources other than revenues generated, such as from the proceeds of loans, public or private equity
+sales, and/or advances from related parties. There is no guarantee that any loans will be received, any equity sales will be made, and/or
+any related parties will provide sufficient funds for us to continue to operate on acceptable terms.
+
+ 
+
+ 13
+
+ 
+
+ 
+
+ 
+
+Company
+Information
+
+ 
+
+Our
+principal office is located at 20801 Biscayne Blvd., Suite 403, Aventura, Florida 33180, and our phone number is (786) 923-0272. Our
+corporate website address is www.hyfi-corp.com. Information contained on, or accessible through, our website is not a part
+of, and is not incorporated by reference into, this Prospectus.
+
+ 
+
+Summary
+of Equity Purchase Agreement And Registration Rights Agreement with Peak One Opportunity Fund, L.P.
+
+ 
+
+On
+August 8, 2022, the Company entered into an equity line of credit ( Equity Line ) established by an Equity Purchase
+Agreement (the Equity Purchase Agreement ) and Registration Rights Agreement (the Registration Rights
+Agreement ) with Peak One Opportunity Fund, L.P., a Delaware limited Partnership (the Investor ). Pursuant
+to the Equity Purchase Agreement, the Company has the right, but not the obligation to direct the Investor to purchase up to
+$15,000,000.00 (the Maximum Commitment Amount ) in shares of the Company s common stock, par value $0.0001 per
+share ( Common Stock ) in multiple tranches (the Put Shares ). Further under the Equity Purchase Agreement
+and subject to the Maximum Commitment Amount, the Company has the right, but not the obligation, to submit a Put Notice (as defined
+in the Equity Purchase Agreement) from time to time to the Investor (i) in an amount not less than $15,000 and (ii) in a maximum
+amount up to the lesser of (a) $300,000 or (b) 200% of the Average Daily Trading Value, as defined in the Equity Purchase Agreement.
+ Average Daily Trading Value is defined in the Equity Purchase Agreement as the average trading volume of the Common
+Stock, on the principal market in which it trades (the Principal Market ), during the ten trading days immediately
+preceding the applicable put date multiplied by the lowest closing bid price of the Company s Common Stock on the Principal
+Market.
+
+ 
+
+In
+exchange for Investor entering into the Equity Purchase Agreement, the Company agreed, among other things, to (i) issue and Peak
+One Investments, LLC, a Delaware limited liability company ( Investments ) a Common Stock Purchase Warrant (the
+ Warrant ) to purchase up to 500,000 shares of Common Stock at a fixed exercise price of $0.20 per share, subject to
+the terms of the Warrants, with a five-year exercise period commencing August 8, 2022, which was the date the Warrant was issued
+and (ii) file a registration statement registering the Common Stock issuable to the Investor under the Equity Purchase Agreement and
+to Investments under the Warrant for resale (the Registration Statement ) with the Securities and Exchange
+Commission within 60 calendar days of the Equity Purchase Agreement, as more specifically set forth in the Registration Rights
+Agreement. The Registration Rights Agreement further provides that the costs associated with this Registration Statement are to be
+borne by the Company.
+
+ 
+
+The
+obligation of Investor to purchase the Company s Common Stock commenced on the date of entry into the Equity Purchase Agreement,
+which was August 8, 2022, ending on earlier of: (i) the date on which Investor shall have purchased Common Stock pursuant to the Equity
+Purchase Agreement equal to the Maximum Commitment Amount (ii) thirty-six (36) months after the date of entry into the Equity Purchase
+Agreement (iii) delivery of written notice of termination of the Equity Purchase Agreement by the Company to the Investor (which shall
+not occur during any Valuation Period, as such term is defined in the Equity Purchase Agreement, or at any time that the Investor holds
+any of the Put Shares) (iv) the Registration Statement is no longer effective after the initial effective date of the Registration Statement
+or (v) the date that the Company commences a voluntary case or any person commences a proceeding against the Company, a custodian is
+appointed for the Company or for all or substantially all of its property or the Company makes a general assignment for the benefit of
+its creditors (the Commitment Period ).
+
+ 
+
+During
+the Commitment Period, the initial purchase price to be paid by the Investor for the Common Stock under the Equity Purchase Agreement
+shall be 90% of the closing bid price of the Common Stock on the trading day immediately preceding the respective Put Date (as
+defined in the Equity Purchase Agreement) on the Principal Market and the purchase price thereafter shall mean 90% of the Market
+Price, which is defined as the lesser of the (i) closing bid price of the Common Stock on the Principal Market on the trading day immediately
+preceding the respective Put Date, or (ii) lowest closing bid price of the Common Stock during the Valuation Period (as defined in the
+Equity Purchase Agreement), in each case as reported by Bloomberg Finance L.P or other reputable source designated by Investor.
+The term Valuation Period means the period of seven trading days immediately following the clearing date associated with
+the applicable Put Notice.
+
+ 
+
+ 14
+
+ 
+
+ 
+
+ 
+
+The
+number of Put Shares to be purchased by the Investor shall not exceed the number of such shares that, when aggregated with all other
+shares of Common Stock then owned by the Investor beneficially or deemed beneficially owned by the Investor, would result in the Investor
+owning more than the Beneficial Ownership Limitation as determined in accordance with Section 16 of the Exchange Act and the regulations
+promulgated thereunder. The Beneficial Ownership Limitation shall be 4.99% of the number of shares of the Common Stock
+outstanding immediately after giving effect to the issuance of shares of Common Stock issuable pursuant to a Put Notice.
+
+ 
+
+The
+Equity Purchase Agreement, the Warrant and the Registration Rights Agreement contain customary representations, warranties, agreements
+and conditions to completing future sale transactions, indemnification rights and obligations of the parties. Among other things, Investor
+represented to the Company, that it is an accredited investor (as such term is defined in Rule 501(a) of Regulation D under
+the Securities Act and the Company sold the securities in reliance upon an exemption from registration contained in Section 4(a)(2) of
+the Securities Act and Regulation D promulgated thereunder.
+
+ 
+
+The
+foregoing descriptions of the Equity Purchase Agreement, the Warrant and the Registration Rights Agreement are qualified in their entirety
+by reference to the full text of such agreements, copies of which are attached as Exhibit 10.14, 10.15 and 10.16 to the
+registration statement of which this prospectus forms a part. The representations, warranties and covenants contained in such agreements
+were made only for purposes of such agreements and as of specific dates, were solely for the benefit of the parties to such agreements
+and may be subject to limitations agreed upon by the contracting parties.
+
+ 
+
+SUMMARY
+RISK FACTORS
+
+ 
+
+Our
+business is subject to numerous risks and uncertainties, including those described in Risk Factors immediately following
+this Prospectus summary and elsewhere in this Prospectus. These risks represent challenges to the successful implementation of our strategy
+and to the growth and future profitability of our business. These risks include, but are not limited to, the following:
+
+ 
+
+ We
+ have a limited operating history in an evolving and highly volatile industry, which makes
+ it difficult to evaluate our future prospects and may increase the risk that we will not
+ be successful.
+
+ The
+ Company has a number of convertible notes issued that are currently in default.
+
+ If
+ we do not effectively manage our growth and the associated demands on our operational, risk
+ management, sales and marketing, technology, compliance, and finance and accounting resources,
+ our business may be adversely impacted.
+
+ Our
+ growth may not be sustainable and depends on our ability to attract new customers, expand
+ product offerings, and increase processed volumes and revenue from new customers.
+
+ We
+ face intense and increasing competition and, if we do not compete effectively, our competitive
+ positioning and our operating results will be harmed.
+
+ Cyberattacks
+ and security breaches of our systems, or those impacting our customers or third parties,
+ could adversely impact our brand and reputation and our business, operating results and financial
+ condition.
+
+ As
+ a remote-first company, we are subject to heightened operational and cybersecurity risks.
+
+ We
+ currently support, and expect to continue to support, certain smart contract-based assets.
+ If the underlying smart contracts for these assets do not operate as expected, they could
+ lose value and our business could be adversely affected.
+
+ The
+ Company has a history of operating losses and its management has concluded that factors raise
+ substantial doubt about its ability to continue as a going concern and the auditor of the
+ Company has included explanatory paragraphs relating to its ability to continue as a going
+ concern in its audit report for the years ended November 30, 2021 and 2020.
+
+ Changes
+ in financial reporting standards or policies, including as a result of choices made by us,
+ could materially adversely affect our reported results of operations and financial condition
+ and may have a corresponding material adverse impact on capital ratios.
+
+ We
+ are subject to an extensive and rapidly-evolving regulatory landscape, and any adverse changes
+ to, or our failure to comply with, any laws and regulations could adversely affect our brand,
+ reputation, business, operating results, and financial condition.
+
+ Some
+ of the assets in which we intend to facilitate trading are subject to regulatory authority
+ by the Commodity Futures Trading Commission ( CFTC ). Fraud in or manipulation
+ of a crypto asset occurring on our platform could subject us to increased regulatory scrutiny,
+ regulatory enforcement, and litigation.
+
+ 
+
+ 15
+
+ 
+
+ 
+
+ 
+
+ Certain
+ transactions in crypto assets may constitute retail leveraged commodity transactions 
+ subject to regulation by the CFTC as futures contracts. If crypto asset transactions we facilitate
+ are deemed to be such retail commodity transactions, we would be subject to additional regulatory
+ requirements, licenses and approvals, and potentially face regulatory enforcement, civil
+ liability, and significant increased compliance and operational costs.
+
+ Particular
+ crypto assets or transactions therein could be deemed commodity interests (e.g.,
+ futures, options, swaps) or security-based swaps subject to regulation by the CFTC or SEC,
+ respectively. If a crypto asset that we facilitate trading in is deemed a commodity interest
+ or a security-based swap, we would be subject to additional regulatory requirements, licenses
+ and approvals, and potentially face regulatory enforcement, civil liability, and significant
+ increased compliance and operational costs.
+
+ We
+ may be sued by third parties for alleged infringement of their proprietary rights.
+
+ Trading
+ on the OTC Markets is volatile and sporadic, which could depress the market price of our
+ common stock and make it difficult for our security holders to resell their common stock.
+
+ FINRA
+ sales practice requirements may also limit a shareholder s ability to buy and sell
+ our stock.
+
+ The
+ issuance of a large number of shares of our Common Stock could significantly dilute existing
+ stockholders and negatively impact the market price of our Common Stock.
+
+ Shares
+ eligible for future sale may adversely affect the market.
+
+ Our
+ management team will have immediate and broad discretion over the use of the net proceeds
+ from this offering and we may use the net proceeds in ways with which you disagree The trading
+ price of BioPower common stock may be volatile, and purchasers of BioPower common stock could
+ incur substantial losses.
+
+ The
+ articles of incorporation, as amended, provides that state or federal court located within
+ the state of Nevada will be the sole and exclusive forum for substantially all disputes between
+ us and our shareholders, which could limit our stockholders ability to obtain a favorable
+ judicial forum for disputes with us or our directors, officers or other employees.
+
+ Our
+ common stock are subject to the penny stock rules. It may be more difficult
+ to resell securities classified as penny stock. 
+
+ We
+ are considered a smaller reporting company and are exempt from certain disclosure requirements,
+ which could make our Common Stock less attractive to potential investors.
+
+ We
+ may be subject to securities litigation, which is expensive and could divert management attention.
+
+ We
+ have never paid dividends on our common stock and have no plans to do so in the future.
+
+ We
+ will indemnify and hold harmless our officers and directors to the maximum extent permitted
+ by Nevada law.
+
+ 
+
+THE
+OFFERING
+
+ 
+
+10,417,963
+Shares of Common Stock Issuable Under the Equity Line
+
+500,000
+Shares of Common Stock Issuable Upon Exercise of Warrants
+
+ 
+
+ 
+ Issuer:
+ 
+ BioPower
+ Operations Corporation
+
+ 
+ 
+ 
+ 
+
+ 
+ Shares
+ to be Issued Pursuant to Put Notices: 
+ 
+ 10,417,963
+ shares of Common Stock that we may issue to Peak One pursuant to put notices under the Equity Purchase Agreement.
+
+ 
+ 
+ 
+ 
+
+ 
+ Shares
+ to be Issued Upon the Exercise of Warrants:
+ 
+ 500,000
+ shares of Common Stock that we may issue to Peak One upon the exercise of Warrants.
+
+ 
+ 
+ 
+ 
+
+ 
+ Common
+ Stock Outstanding before Offering and prior to the Exercise of any Warrants:
+ 
+ 45,625,000
+ shares of Common Stock.(1)
+
+ 
+ 
+
+ 16
+
+ 
+
+ 
+
+ 
+
+ 
+ Common
+ Stock Outstanding after Offering assuming the Exercise of the Warrants:
+ 
+ 56,542,963
+ shares of Common Stock, assuming (i) all 10,417,963 shares are sold to the Selling Stockholder under the Equity Line and (ii) the
+ Selling Stockholder exercises the 500,000 Warrants and 500,000 shares of Common Stock are issued to the Selling Stockholder. If we
+ sell less shares of Common Stock to the Selling Stockholder under the Equity Line, we have substantially less Common Stock outstanding
+ after the Offering.
+
+ 
+ 
+ 
+ 
+
+ 
+ Terms
+ of Warrants:
+ 
+ The
+ Warrant may be exercised at any time for five years from the date of issuance at a fixed exercise price of $0.20 per Common Stock
+ share, subject to adjustments as specified in the Warrant, including an anti-dilution provision. In the event that there is no effective
+ registration statement registering the shares underlying the Warrants, then the Warrants may be exercised by means of a cashless
+ exercise at the holder s option, such that the holder may use the appreciated value of the Warrants (the difference
+ between the market price of the underlying shares of common stock and the exercise price of the underlying Warrants) to exercise
+ the Warrants without the payment of any cash.
+
+ 
+ 
+ 
+ 
+
+ 
+ Use
+ of proceeds:
+ 
+ We
+ will not receive any of the proceeds from the Selling Securityholders sales of our stock. We will receive proceeds from the sale
+ of our stock to Peak One pursuant to the Equity Purchase Agreement and from any cash exercise by Peak One of Warrants, which we intend
+ to use to fund our product development programs, acquisition of new products, working capital and to general operational needs. The
+ amounts that we actually spend for any specific purpose may vary significantly, and will depend on a number of factors including,
+ but not limited to, market conditions. In addition, we may use a portion of any net proceeds to acquire complementary businesses;
+ however, we do not have plans for any acquisitions at this time. See Use of Proceeds. 
+
+ 
+ 
+ 
+ 
+
+ 
+ Risk
+ factors:
+ 
+ See
+ Risk Factors beginning on page 19 of this prospectus for a discussion of some of the factors you should carefully
+ consider before deciding to invest in our common stock.
+
+ 
+ 
+ 
+ 
+
+ 
+ Trading
+ Market:
+ 
+ Our
+ Common Stock is currently quoted on the OTC Pink tier of the OTC Market Group, Inc. under the symbol BOPO .
+
+ 
+ 
+ 
+ 
+
+ 
+ Transfer
+ Agent and Registrar:
+ 
+ Continental
+ Stock Transfer & Trust Co. is our transfer agent and registrar in connection with the offering.
+
+ 
+ 
+ 
+ 
+
+ 
+ Ownership
+ Limits (Blockers):
+ 
+ The
+ number of Put Shares to be purchased by the Investor shall not exceed the number of such shares that, when aggregated with all other
+ shares of Common Stock then deemed beneficially owned by the Investor, would result in the Investor owning more than 4.99% of the
+ number of shares of the Common Stock outstanding immediately after giving effect to the issuance of the Put Shares.
+
+ 
+ 
+ 
+ 
+
+ 
+ Dividend
+ policy: 
+ 
+ We
+ do not anticipate declaring or paying any cash dividends on our common stock in the foreseeable future.
+
+ 
+ 
+
+(1)
+Unless we indicate otherwise, all information in this prospectus is based on 45,625,000 shares of Common Stock issued and outstanding
+as of October 7, 2022.
+
+ 
+
+ 17
\ No newline at end of file
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new file mode 100644
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this Prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our securities, you should carefully read this entire Prospectus, including the section titled Risk Factors and our historical consolidated financial statements and the documents to which we refer you. The following summary is qualified in its entirety by reference to the detailed information appearing elsewhere in this Registration Statement on Form S-1 (the Registration Statement ) of which this Prospectus is a part. Readers should not assume that the information contained in this Prospectus is accurate as of any date other than the date on the cover page of this Prospectus. Our Business Overview We own 100% of Alternative Solutions, LLC, a Nevada-based holding company ( Alternative Solutions ), which is a Nevada-based holding company that owns three separate entities with licenses to operate cannabis businesses within the State of Nevada: Serenity Wellness Center, LLC dba Oasis Cannabis ( Oasis ); Serenity Wellness Growers, LLC dba City Trees Fresh Cannabis Cultivation Wholesale; and Serenity Wellness Products, LLC dba City Trees Fresh Cannabis Production Wholesale. Oasis currently operates a retail marijuana dispensary within walking distance to the Las Vegas Strip. Its other subsidiaries, which do business as City Trees Cultivation and City Trees Production, currently operate a small-scale cultivation facility, as well as a product manufacturing facility and a wholesale distribution operation in North Las Vegas. Management expects that the vertically integrated business model will drive strong margins to the bottom line on a large portion of existing sales at the dispensary as the newly expanded Warehouse Facility becomes fully operational. Oasis retail dispensary is a single location operation in Nevada and occupies over 5,000 square feet of an over 20,000 square foot building This location, which is easily accessible by tourists, is currently open 19.5 hours per day for walk-in / in-store pickup and 19.5 hours per day for curbside orders. It also delivers cannabis to residents between the hours of 8:00 AM and 10:00 PM. The central location provides logistical convenience for delivery to all parts of the Las Vegas valley. City Trees wholesale operations, which occupies approximately 10,000 square feet of a 22,000 square foot warehouse (the Warehouse Facility ), began sales to third parties in August 2017 and completed construction and received certificate of occupancy for its state-of-the-art extraction facility in December of 2019. It had made sales to over 45 external customers as of February 28, 2022. Its existing product line includes vaporizers, tinctures, ethanol produced THC distillate, and live and cured hydrocarbon concentrates. At present, the City Trees cultivation facility only grows breeding stock to preserve valuable genetics and does not offer its crops for sale or processing. As a result, all raw materials for manufacturing are sourced from third parties. See Our Business . Corporate Information The mailing address of our principal executive office is 11767 South Dixie Highway, Suite 115, Miami, Florida 33156 and our telephone number is (888) 359-4666. We maintain a website at www.clsholdingsinc.com. The information contained on our website is not intended to form a part of, or be incorporated by reference into, this Prospectus. History and Recent Developments The Company was initially incorporated on March 31, 2011 as Adelt Design, Inc. under Chapter 78 of the Nevada Revised Statutes. On April 29, 2015, we entered into a merger agreement with CLS Labs and a newly-formed, wholly-owned subsidiary and effected the Merger (see Our Business The Merger ). Upon the consummation of the Merger, the separate existence of the wholly-owned subsidiary ceased and CLS Labs, the surviving corporation in the Merger, became a wholly owned subsidiary of the Company, with the Company acquiring the stock of CLS Labs, abandoning its previous business, and adopting the existing business plan and operations of CLS Labs. Since 2014, one of the founders of CLS Labs has been developing a proprietary method of extracting cannabinoids from cannabis plants and converting the resulting cannabinoid extracts into concentrates such as oils, waxes, edibles and shatter. In 2017, we began pursuing other revenue producing opportunities, which resulted in our acquisition of Oasis in June 2018. See Our Business - History . Table of Contents FORWARD-LOOKING STATEMENTS
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+53 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS Balance Sheets September (unaudited) for the nine months ended September 30, 2020 and 2021 F-2 Condensed Statements of Operations (unaudited) for the nine months ended September 30, 2020 and 2021 F-3 Condensed Statement of Shareholders Deficit (unaudited) for the Nine Months Ended September 30, 2020 and 2021 F-5 Condensed Statements of Cash Flows (unaudited) for the nine months ended September 30, 2020 and 2021 F-6 Notes to Condensed Financial Statements F-7 Report of Independent Registered Public Accounting Firm F-20 Consolidated Balance Sheets as of December 31, 2020 and 2019 F-21 Consolidated Statements of Operations for the years ended December 31, 2020 and 2019 F-22 Consolidated Statements of Stockholders Deficit for the years ended December 31, 2020 and 2019 F-23 Consolidated Statements of Cash Flows for the years ended December 31, 2020 and 2019 F-24 Notes to Consolidated Financial Statements F-25 F-1 H-Cyte, Inc Consolidated Balance Sheets (Expressed in U.S. Dollars) (Unaudited) (Unaudited) Sept 30, 2021 December 31, 2020 Assets Current Assets Cash $307,213 $1,640,645 Accounts receivable 9,200 - Patient financing receivable, current portion 35,080 - Other receivables 551 22,123 Prepaid expenses 106,228 94,434 Total Current Assets 458,272 1,757,202 Right-of-use asset 162,207 278,552 Property and equipment, net 40,344 139,175 Patient financing receivable, net of current portion 61,547 - Other assets 18,412 29,239 Total assets $740,782 $2,204,168 Liabilities and Stockholders Deficit Current Liabilities Accounts payable $1,044,727 $1,006,968 Accrued liabilities 187,119 276,415 Other current liabilities 141,330 154,812 Short-term notes, related party Short-term convertible notes payable Notes payable, current portion 67,444 67,444 Dividend payable Convertible notes payable, related parties 1,584,665 - Convertible notes payable 1,091,080 - PPP Loan, current portion 105,878 606,811 Deferred revenue 410,031 634,149 Lease liability, current portion 92,589 139,189 Interest payable 4,385 6,898 Total Current Liabilities 4,729,248 2,892,686 Long-term Liabilities Lease liability, net of current portion 87,304 157,050 Notes payable, net of current portion Derivative liability - warrants Redemption put liability PPP Loan, net of current portion - 202,271 Total Long-term Liabilities 87,304 359,321 Total Liabilities 4,816,552 3,252,007 Commitments and Contingencies (Note 10) Mezzanine Equity Total Mezzanine Equity Stockholders Equity (Deficit) Preferred Stock - $.001 par value: 1,000,000,000 shares authorized; Series A Preferred Stock - $.001 par value: 800,000,000 shares authorized, 515,874,354 and 538,109,409 shares issued and outstanding at September 30, 2021 and, December 31, 2020, respectively 515,874 538,109 Common stock - $.001 par value: 1,600,000,000 shares authorized, 149,394,519 and 127,159,464 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively 149,394 127,159 Additional paid-in capital 43,540,358 42,515,999 Accumulated deficit (47,911,264) (43,858,974) Non-controlling interest (370,132) (370,132) Total Stockholders Deficit (4,075,770) (1,047,839) Total Liabilities and Stockholders Deficit $740,782 $2,204,168 The accompanying notes are an integral part of these consolidated financial statements F-2 H-Cyte, Inc Consolidated Statement of Operations (Expressed in U.S Dollars) (Unaudited) Three Months Ended Sept 30, Nine Months Ended Sept 30, 2021 2020 2021 2020 Revenues $460,216 $649,892 $1,286,841 $1,686,168 Cost of Sales (138,786) (161,252) (553,454) (608,079) Gross Profit 321,430 488,640 733,387 1,078,089 Operating Expenses Salaries and related costs 534,752 606,294 1,782,646 2,425,094 Share based compensation 162,359 - 1,024,359 643 Loss on disposal of property and equipment - - 92,804 - Other general and administrative 789,365 542,317 2,229,120 2,806,707 Research and development 3,285 201,658 3,285 1,151,658 Advertising 58,643 51,643 223,871 222,196 Loss on impairment Depreciation and amortization 300 30,095 13,859 69,447 Total Operating Expenses 1,548,704 1,432,007 5,369,944 6,675,745 Operating Loss (1,227,274) (943,367) (4,636,557) (5,597,656) Other Income (Expense) Forgiveness of PPP loan 698,820 - 698,820 - Gain on extinguishment of debt - - - 1,300,088 Interest expense (50,516) (1,039,349) (110,446) (1,458,521) Other income (expense) (7,641) (34,504) (4,107) (25,182) Change in fair value of redemption put liability - 97,997 - 272,705 Loss on derivative instrument - - - (2,306,121) Warrant modification expense - - - (70,851) Change in fair value of derivative liability - warrants - 5,869,102 - 2,986,853 Total Other Income (Expense) 640,663 4,893,246 584,267 698,971 Net Income (Loss) $(586,611) $3,949,879 $(4,052,290) $(4,898,685) Accrued dividends on outstanding Series B Convertible Preferred Stock - 7,856 - 44,456 Finance costs on issuance of Series D Convertible Preferred Stock Deemed dividend on adjustment to exercise price on convertible debt and certain warrants Deemed dividend on beneficial conversion features Deemed dividend on Series D Convertible Preferred Stock - 36,450 - 277,719 Net Income (Loss) attributable to common stockholders $(586,611) $3,905,573 $(4,052,290) $(5,220,860) Net Income (Loss) per share Basic $(0.00) $0.03 $(0.03) $(0.05) Diluted $ (0.00) $0.01 $(0.03) $(0.05) Weighted average outstanding shares - basic 142,407,798 116,970,322 140,074,271 106,691,185 Weighted average outstanding shares - diluted 142,407,798 664,244,972 140,074,271 106,691,185 The accompanying notes are an integral part of these consolidated financial statements F-3 H-Cyte, Inc Statements of Stockholders Equity (Deficit) (Expressed in U. S. Dollars) (Unaudited) Three months ended Preferred Series A Stock Preferred Series B Stock Common Stock Additional Paid-in Accumulated Non-controlling Total Stockholders September 30, 2020 and 2021 Shares Amount Shares Amount Shares Amount Capital Deficit Interest Deficit Balances - June 30, 2020 - $- 6,100 $6 104,246,357 $104,246 $27,761,076 $(46,248,302) $(370,132) $ (18,753,106) Share based compensation Conversion of Series A Preferred Stock to common stock Conversion of Series A Preferred Stock to common stock, shares Purchase accounting adjustments Purchase accounting adjustments, Shares Adjustment for assets and liabilities not included in Merger Issuance of common stock in connection with private placement offering Issuance of common stock in connection with private placement offering, shares Finance costs on issuance of Series B Convertible Preferred Stock and related warrants Issuance of common stock pursuant to conversion of short-term debt Issuance of common stock pursuant to conversion of short-term debt, shares Issuance of warrants pursuant to conversion of short-term debt Issuance of additional exchange shares Issuance of additional exchange shares, shares Issuance of common stock pursuant to conversion of convertible short-term debt Issuance of common stock pursuant to conversion of convertible short-term debt, Shares Issuance of common stock pursuant to warrant exchange Issuance of common stock pursuant to warrant exchange, Shares Conversion of Series B Convertible Preferred Stock Conversion of Series B Convertible Preferred Stock, Shares Issuance of common stock per restricted stock award to executive Issuance of common stock per restricted stock award to executive,shares Repurchase of Series B Convertible Preferred Stock Repurchase of Series B Convertible Preferred Stock, Shares Issuance of common stock to pay accrued dividends on Series B Convertible Preferred Stock Issuance of common stock to pay accrued dividends on Series B Convertible Preferred Stock, Shares Issuance of common stock to pay accrued interest on convertible short-term debt Issuance of common stock to pay accrued interest on convertible short-term debt, Shares Deemed dividend on adjustment to exercise price on convertible debt and certain warrants Deemed dividend on beneficial conversion features Issuance of common stock per restricted stock award to executive Issuance of common stock per restricted stock award to executive, Shares Issuance of warrants pursuant to short-term notes, related party Deemed dividend on Series D Convertible Preferred Stock Beneficial conversion of Series D Convertible Preferred Stock Finance costs on issuance of Series D Convertible Preferred Stock and related warrants Accrued dividends on Series B Convertible Preferred Stock Conversion of Series B Convertible Preferred Stock to Common Stock Conversion of Series B Convertible Preferred Stock to Common Stock, Shares Conversion of Series D Convertible Preferred Stock to Common Stock Conversion of Series D Convertible Preferred Stock to Common Stock. shares Conversion of Short-term convertible notes payable - related party Conversion of Short-term convertible notes payable - related party, shares Conversion of April Advance notes - related parties Conversion of April Advance notes - related parties, shares Issuance of warrants pursuant to conversion of Short-term convertible notes Issuance of common stock in connection with extinguishment of short-term notes, related party Issuance of common stock in connection with extinguishment of short-term notes, related party, Shares Deemed dividend on Series D Convertible Preferred Stock at issuance Reclassification of related party warrants to equity Issuance of warrants pursuant to extension of convertible short-term notes, related party Issuance of Series A Preferred Stock in Rights Offering, net of issuance costs Issuance of Series A Preferred Stock in Rights Offering, net of issuance costs, shares Conversion of warrants to Common Stock Conversion of warrants to Common Stock,shares Conversion of Series B Preferred Stock to Common Stock - - (6,100) (6) 2,119,713 2,120 150,983 - - 153,097 Accrued dividends on Series B Preferred Stock - - - - - - (7,856) - - (7,856) Adjustment of exercise price on certain warrants Reclassification of Series B warrants to equity Reclassification of Series D warrants to equity Conversion of Series B Preferred Stock Conversion of Series B Preferred Stock, shares Conversion of Short-term related party convertible notes to Preferred Stock 35,860 412,541 448,401 Conversion of Short-term related party convertible notes to Preferred Stock, shares Issuance of Common Stock in connection with extinguishment of short term notes, related parties Issuance of Common Stock in connection with extinguishment of short term notes, related parties, shares Deemed dividend on Series D Preferred Stock - - - - - - (36,450) - - (36,450) Deemed dividend on Series D Preferred Stock at issuance Issuance of Common Stock in exchange for consulting fees incurred Issuance of Common Stock in exchange for consulting fees incurred, shares Issuance of warrants pursuant to private placement of Series D Convertible Preferred Stock Conversion of Short-term convertible notes to Preferred Stock 287,984,337 287,984 - - - - 4,751,484 - - 5,039,468 Issuance of warrants pursuant to extension of convertible short-term notes Issuance of warrants pursuant to extension of maturity date on convertible debt Conversion of related party warrants to equity - - - - - - 107,123 - - 107,123 Conversion of Series D Preferred Stock to Common Stock - - - - 15,773,363 15,773 6,422,441 - - 6,438,214 Reclassification of Series B warrants to Common Stock - - - - - - 73,805 - - 73,805 Reclassification of Series D warrants to Common Stock - - - - - - 337,400 - - 337,400 Issuance of Series A Preferred Stock in Rights Offering 218,285,024 218,285 - - - - 2,517,451 - - 2,735,736 Conversion of Short-term related party convertible notes to Preferred Stock 35,860,079 35,860 - - - - 412,541 - - 448,401 Stock based compensation Conversion of Series A Preferred Stock to common stock Conversion of Series A Preferred Stock to common stock, shares Issuance of share based compensation Net loss - - - - - - - 3,949,879 - 3,949,879 Balances September 30, 2020 542,129,440 $542,129 - $- 122,139,433 $122,139 $42,489,998 $(42,298,423) $(370,132) $485,711 Preferred Series A Stock Preferred Series B Stock Common Stock Additional Paid-in Accumulated Non-controlling Total Stockholders Shares Amount Shares Amount Shares Amount Capital Deficit Interest Deficit Balances - June 30, 2021 520,305,884 $ 520,305 - - 144,962,989 $ 144,963 $ 43,377,999 $ (47,324,653 ) $ (370,132 ) $ (3,651,518 ) Share based compensation - - - - - - 162,359 - - 162,359 Conversion of Series A Preferred Stock to common stock (4,431,530 ) (4,431 ) - - 4,431,530 4,431 - - - - Net Loss - - - - - - - (586,611 ) - (586,611 ) Balances September 30, 2021 515,874,354 $ 515,874 - - 149,394,519 $ 149,394 $ 43,540,358 $ (47,911,264) $ (370,132 ) $ (4,075,770) F-4 Nine months ended Preferred Series A Stock Preferred Series B Stock Common Stock Additional Paid-in Accumulated Non-controlling Total Stockholders September 30, 2020 and 2021 Shares Amount Shares Amount Shares Amount Capital Deficit Interest Deficit Balances - December 31, 2019 - $- 6,100 $6 99,768,704 $99,769 $28,172,146 $(37,362,531) $(370,132) $ (9,460,742) Accrued dividends on Series B Preferred Stock - - - - - - (44,456) - - (44,456) Adjustment of exercise price on certain warrants - - - - - - (438,913) - - (438,913) Reclassification of Series B warrants to equity - - - - - - 73,805 - - 73,805 Reclassification of Series D warrants to equity - - - - - - 337,400 - - 337,400 Conversion of Series B Preferred Stock - - (6,100) (6) 2,119,713 2,120 150,983 - - 153,097 Conversion of Series D Preferred Stock to Common Stock - - - - 15,773,363 15,773 6,422,441 - - 6,438,214 Conversion of Short-term related party convertible notes to Preferred Stock 35,860,079 35,860 - - - - 412,541 - - 448,401 Issuance of Common Stock in connection with extinguishment of short term notes, related parties - - - - 4,368,278 4,368 214,046 - - 218,414 Deemed dividend on Series D Preferred Stock - - - - - - (277,719) - - (277,719) Deemed dividend on Series D Preferred Stock at issuance - - - - - - - (37,207) - (37,207) Conversion of related party warrants to equity - - - - - - 107,123 - - 107,123 Issuance of Common Stock in exchange for consulting fees incurred - - - - 109,375 109 34,891 - - 35,000 Issuance of warrants pursuant to private placement of Series D Convertible Preferred Stock - - - - - - 31,902 - - 31,902 Conversion of short-term convertible notes to Preferred Stock 287,984,337 287,984 - - - - 4,751,484 - - 5,039,468 Issuance of warrants pursuant to extension of convertible short-term notes - - - - - - 17,636 - - 17,636 Issuance of warrants pursuant to extension of maturity date on convertible debt - - - - - - 6,595 - - 6,595 Issuance of Series A Preferred Stock in Rights Offering 218,285,024 218,285 - - - - 2,517,451 - - 2,735,736 Share based compensation - - - - - - 643 - - 643 Net loss - - - - - - - (4,898,685) - (4,898,685) Balances September 30, 2020 542,129,440 $542,129 - $- 122,139,433 $122,139 $42,489,998 $(42,298,423) $(370,132) $485,711 Preferred Series A Stock Preferred Series B Stock Common Stock Additional Paid-in Accumulated Non-controlling Total Stockholders Shares Amount Shares Amount Shares Amount Capital Deficit Interest Deficit Balances - December 31, 2020 538,109,409 $538,109 - $ - 127,159,464 $127,159 $42,515,999 $(43,858,974) $(370,132) $ (1,047,839) Balance 538,109,409 $538,109 - $ - 127,159,464 $127,159 $42,515,999 $(43,858,974) $(370,132) $(1,047,839) Conversion of Series A Preferred Stock to common stock (22,235,055) (22,235) - - 22,235,055 22,235 - - - - Share based compensation - - - - - - 1,024,359 - - 1,024,359 Net loss - - - - - - - (4,052,290) - (4,052,290) Balances September 30, 2021 515,874,354 $515,874 - $- 149,394,519 $149,394 $43,540,358 $(47,911,264) $(370,132) $(4,075,770) Ending balance 515,874,354 $515,874 - $- 149,394,519 $149,394 $43,540,358 $(47,911,264) $(370,132) $(4,075,770) The accompanying notes are an integral part of these financial statements F-5 H-Cyte, Inc Consolidated Statements of Cash Flows (Expressed in U.S Dollars) (Unaudited) Nine Months Ended Sept 30, 2021 2020 Cash Flows from Operating Activities Net loss $(4,052,290) $(4,898,685) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 13,859 69,447 Loss on impairment Loss on asset disposal 92,804 Amortization of debt discount - 1,395,007 Interest and penalties on extension of short-term convertible notes Forgiveness of PPP loan (698,820) - Issuance of warrants to extend convertible debt - 17,636 Issuance of warrants pursuant to short-term notes, related party - (1,300,088) Issuance of warrants to extend short-term debt - 6,595 Share based compensation expense 1,024,359 643 Loss on write-off of inventory Common stock issued for consulting services - 35,000 Income from change in fair value adjustment of derivative liability - warrants Change in fair value of redemption put liability (272,705) Change in fair value of derivative liability - warrants - (2,986,853) Change in fair value of derivative liability - warrants - (272,705 ) Change in fair value of derivative liability - Day one derivative loss - 2,306,121 Issuance of warrants to extend short-term debt, related party Bad debt expense Issuance of warrants pursuant to extension of maturity date on convertible debt Issuance of Common Stock pursuant to warrant exchange Gain on extinguishment of short-term notes, related party (1,300,088) Warrant modification expense - 70,851 Loss on disposal of property and equipment 92,804 - Changes in operating assets and liabilities: Accounts receivable (9,200) 20,167 Patient financing receivable, current portion (35,080) - Other receivables 21,572 16,372 Patient financing receivable, net of current portion (61,547) - Prepaid expenses and other assets (968) 707,457 Interest payable 6,333 35,565 Accounts Payable 37,759 (237,409) Accrued liabilities (89,296) (21,206) Other current liabilities (13,482) (15,680) Deferred revenue (224,118) (409,375) Net Cash Used in Operating Activities (3,988,115) (5,461,140) Cash Flows from Investing Activities Purchase of property and equipment (7,832) (2,285 ) Purchase of business, net of cash acquired Net assets not included in purchase transaction Net Cash Used in Investing Activities (7,832) (2,285 ) Cash Flows from Financing Activities Proceeds from short-term related party notes 1,584,665 Payment of dividends Proceeds from convertible notes payable, related parties 1,584,665 - Proceeds from convertible notes payable 1,091,080 - Proceeds from PPP loan - 809,082 Payment on debt obligations Proceeds from common stock, net of issuance costs Proceeds from Secured Convertible Promissory Notes Proceeds from issuance of Series D Convertible Preferred Stock, net of issuance costs Payments on PPP Loan (13,230 ) (10,937 ) Proceeds from warrants, net of issuance costs - 3,842,695 Proceeds from issuance of Preferred Stock Series A, net of issuance costs - 2,735,736 Proceeds from Preferred stock Series A, net of issuance costs 2,735,736 Payment on Preferred stock Series B Convertible Preferred Stock redemption Proceeds from issuance of Series D Convertible Preferred Stock - 100,000 Net Cash Provided by Financing Activities 2,662,515 7,476,576 Net Change in Cash (1,333,432) 2,013,151 Cash - Beginning of period 1,640,645 1,424,096 Cash - End of period $307,213 $3,437,247 Supplementary Cash Flow Information Cash paid for interest $3,367 $17,066 Non-cash investing and financing activities Deemed Dividend on Series D Convertible Preferred Stock $ - $ 314,926 Conversion of Series D Preferred Stock to Common Stock - 6,438,214 Conversion of related party (Horne) warrants to equity - 107,123 Reclassification of Series B warrants to equity - 73,805 Reclassification of Series D warrants to equity - 337,400 Issuance of Common Stock in exchange for consulting fees - 35,000 Issuance of warrants to extend short-term debt - 6,595 Issuance of warrants pursuant to extension of convertible short-term notes - 17,636 Conversion of Series B Preferred Stock to Common Stock - 153,097 Conversion of short-term related party convertible notes to Preferred Stock - 412,541 Conversion of short-term convertible notes to Preferred Stock - 4,751,484 Dividends accrued on Series B Preferred Stock - 44,456 Adjustment of exercise price on convertible debt - 438,913 Issuance of Common Stock in connection with extinguishment of short-term notes, related parties - 218,414 Issuance of Warrants in connection with Series D Convertible Preferred Stock - 31,902 The accompanying notes are an integral part of these consolidated financial statements F-6 H-Cyte, Inc Notes to the Consolidated Financial Statements (expressed in U.S. dollars) (Unaudited) Note 1 - Description of the Company H-CYTE, Inc ( the Company ) is a hybrid-biopharmaceutical company dedicated to developing and delivering new treatments for patients with chronic respiratory and pulmonary disorders. During the last two years, the Company has evolved into two separate divisions with its entrance into the biologics development space ( Biologics Division ). This new division is complementary to the Company s current Lung Health Institute (LHI) autologous infusion therapy business ( Infusion Division ) and is focused on underserved disease states. On September 8, 2021, the Company announced that its Lung Health Institute facilities changed its name to Centers for Respiratory Health as the clinics continue to deliver treatments for patients with chronic respiratory and pulmonary disorders. The consolidated results for H-CYTE include the following wholly-owned subsidiaries: H-CYTE Management, LLC, Medovex Corp, Cognitive Health Institute, LLC, and Lung Institute Tampa, LLC and the results include Lung Institute Dallas, PLLC ( LI Dallas ), Lung Institute Nashville, PLLC ( LI Nashville ), Lung Institute Pittsburgh, PLLC ( LI Pittsburgh ), and Lung Institute Scottsdale, LLC ( LI Scottsdale ), as Variable Interest Entities ( VIEs ). Additionally, H-CYTE Management, LLC is the operator and manager of the various Lung Health Institute (LHI) clinics: LI Dallas, LI Nashville, LI Pittsburgh, and LI Scottsdale. The LI Dallas and LI Pittsburgh clinics did not reopen in 2020 after the temporary closure of all LI clinics due to COVID-19. These two clinics will remain permanently closed. On September 11, 2020, with the closing of the Rights Offering, FWHC, LLC, FWHC Bridge, LLC, and FWHC Bridge Friends, LLC (collectively known as FWHC ) gained control of the Company by subsequently owning approximately 61% of the fully diluted shares of the Company (for further discussion, see Notes 8 and 9- Equity Transactions to the consolidated financial statements in the Company s 2020 Annual Report on Form 10-K). Autologous Infusion Therapy ( Infusion Division ) The Infusion Division develops and implements innovative treatment options in autologous cellular therapy (PRP-PBMC) to treat chronic lung disorders. Committed to an individualized patient-centric approach, this division provides oversight and management of the highest quality to the LHI clinics, while producing positive medical outcomes following the strictest Centers for Disease Control and Prevention (the CDC ) guidelines. Biotech Development ( Biologics Division ) On June 21, 2019, H-CYTE entered into an exclusive product supply agreement with Rion, LLC ( Rion ) to develop and distribute (post U.S. Food & Drug Administration, the FDA , approval) a biologic combining its PRP-PBMC technology with Rion s exosomes ( EV ) technology for the treatment of chronic obstructive pulmonary disease ( COPD ), the fourth leading cause of death in the U.S. Rion has established a novel EV technology to harness the healing power of the body. Rion s innovative technology, based on science developed at Mayo Clinic, provides an off-the-shelf platform to enhance healing in soft tissue, musculoskeletal, cardiovascular, and neurological organ systems. This agreement provides for a 10-year exclusive and extendable supply agreement with Rion to enable H-CYTE to develop combined proprietary biologics. The Company is evaluating alternate EV technologies to determine the most favorable path forward. On October 9, 2019, the Company entered into a services agreement with Rion which provides the Company the benefit of Rion s resources and expertise for the limited purpose of (i) consulting with and assisting H-CYTE in the further research and development for the generation of a new biologic and (ii) subsequently assisting H-CYTE in seeking and obtaining FDA Phase 1 IND clearance for this biologic as necessary. Rion has completed the research and development work which is under review by the Company. The Company is assessing if the Rion combined proprietary biologic is a more viable solution than potentially progressing with a single entity biologic from an alternative commercial source. F-7 On April 2, 2021, the Company entered into a series of agreements with Medovex, LLC to pursue a joint venture regarding the continued development and commercialization of the DenerveX device for business outside of the U.S. The Company has determined that the transactions resulting from the series of agreements with Medovex, LLC are immaterial. The Company will assess the progress of the joint venture on a quarterly basis for materiality. Note 2 Basis of presentation The accompanying interim consolidated financial statements have been prepared based upon U.S. Securities and Exchange Commission rules that permit reduced disclosure for interim periods. Therefore, they do not include all information and footnote disclosures necessary for a complete presentation of the Company s financial position, results of operations, and cash flows in conformity with generally accepted accounting principles. The Company filed audited consolidated financial statements as of and for the fiscal years ended December 31, 2020 and 2019, which included all information and notes necessary for such complete presentation in conjunction with its 2020 Annual Report on Form 10-K. The results of operations for the interim period ended September 30, 2021 are not necessarily indicative of the results to be expected for any future period or the entire fiscal year. These interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements for the year ended December 31, 2020, which are contained in the Company s 2020 Annual Report on Form 10-K. For further discussion refer to Note 2 Basis Of Presentation And Summary of Significant Accounting Policies to the consolidated financial statements and Management s Discussion and Analysis of Financial Condition and Results of Operations Critical Accounting Policies and Estimates in the Company s Annual Report on Form 10-K for the fiscal year ended December 31, 2020. Principles of Consolidation Note 3 - Liquidity, Going Concern and Management s Plans The Company incurred net losses of approximately $587,000 and $4,052,000 for the three and nine months ended September 30, 2021. The Company has historically incurred losses from operations and expects to continue to generate negative cash flows as it implements its plan around the Biosciences Division. The interim consolidated financial statements are prepared using accounting principles generally accepted in the United States ( U.S. GAAP ) as applicable to a going concern. COVID-19 has adversely affected the Company s financial condition and results of operations. The impact of the outbreak of COVID-19 on the economy in the U.S. and the rest of the world is expected to continue to be significant. The extent to which the COVID-19 outbreak will continue to impact the economy is highly uncertain and cannot be predicted. Accordingly, the Company cannot predict the extent to which its financial condition and results of operations will be affected. F-8 Convertible Notes Payable On April 1, 2021, the Company, entered into a Secured Convertible Note Purchase Agreement (the April 2021 Note Purchase Agreement ) with five (5) investors (the Holders ). Pursuant to the terms of the April 2021 Note Purchase Agreement, the Company sold promissory notes in the aggregate principal amount of $2,575,000 maturing on March 31, 2022 with an annual interest rate of 8%. The Notes, plus accrued interest, are convertible into shares of Common Stock at a discount of 20% to the price paid for such New Securities in the next round of financing that meets the definition of Qualified Financing as defined in the April 2021 Note Purchase Agreement. The Notes are secured by the assets of the Company under a security agreement with the Holders. The lead investor of the April 2021 Note Purchase Agreement, FWHC Bridge, LLC, advanced $1,500,000 of the total amount to the Company. FWHC Bridge, LLC is an affiliated entity of FWHC, LLC, which is a principal stockholder and related party of the Company. An additional affiliate of FWHC, LLC provided an additional $25,000 as part of the April 2021 Note Purchase Agreement. On October 14, 2021, H-Cyte, Inc. (the Company ) entered into the Second Closing Bring Down Agreement (the October 2021 Note Purchase Agreement ) whereby the five (5) investors who had entered into the April 2021 Note Purchase Agreement purchased new notes in the Company in the aggregate principal amount of $750,000. The Notes are due and payable on March 31, 2022 and bear interest at an annual rate of 8%. The Notes are convertible into shares of Common Stock at a discount of 20% to the price paid for such New Securities in the next financing that meets the definition of a Qualified Financing as defined in the April 2021 Note Purchase Agreement. The Notes are secured by all of the assets of the Company under a security agreement with the Holders. The lead investor of the October 2021 Note Purchase Agreement, FWHC Bridge, LLC, advanced $437,000 of the total amount to the Company. FWHC Bridge, LLC is an affiliated entity of FWHC, LLC, which is a principal stockholder and related party of the Company. An additional affiliate of FWHC, LLC provided an additional $7,500 as part of the October 2021 Note Purchase Agreement. The Company chose early adoption of ASU 2020-06 Accounting for Convertible Instruments and Contracts in an Entity s Own Equity effective January 1, 2021 related to the April 2021 and October 2021 Note Purchase Agreements. The Company had cash on hand of approximately $307,000 as of September 30, 2021 and approximately $644,000 as of November 9, 2021. The Company s cash is insufficient to fund its operations over the next year and the Company is currently working to obtain additional debt or equity financing to help support the Biosciences Division s business model. There can be no assurance that the Company will be able to raise additional funds or that the terms and conditions of any future financings will be workable or acceptable to the Company or its shareholders. If the Company is unable to fund its operations from existing cash on hand, operating cash flows, additional borrowings, or raising equity capital, the Company may be forced to discontinue operations. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. Note 4 Right-of-use Asset And Lease Liability The components of lease expense, which are included in other general and administrative expense, for the three and nine months ended September 30, 2021 and 2020, respectively, are as follows: Schedule of Components of Lease Expense Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Operating lease expense $69,582 140,381 253,233 442,409 Cash paid for amounts included in the measurement of lease liabilities for the three and nine months ended September 30, 2021 and 2020, respectively, are as follows: Schedule of Cash Paid for Amounts Included the Measurement of Lease Liabilities Three Months Ended September 30, Nine Months Ended September 30, 2021 2020 2021 2020 Operating cash flows from operating leases $69,582 140,381 253,233 442,409 Supplemental balance sheet and other information related to operating leases are as follows: Schedule of Supplemental Balance Sheet and Other Information September 30, 2021 December 31, 2020 Operating leases right-of-use assets $162,207 278,552 Lease liability, current portion 92,589 139,189 Lease liability, net of current portion 87,304 157,050 Total operating lease liabilities $179,893 296,239 Weighted average remaining lease term 1.92 years 2.32 years Weighted average discount rate 9.96% 10.31% F-9 Future maturities of operating lease liabilities as of September 30, 2021 are as follows: Schedule of Maturities of Lease Liabilities Operating leases Remainder of 2021 $25,584 2022 102,891 2023 69,333 Due after two years through three years 69,333 Total lease payments 197,808 Total lease payments 197,808 Less: Interest 17,915 Total lease liability $179,893 The Company did not renew its corporate office space lease in Tampa, FL which expired on March 31, 2021. The Company leases medical clinic space in Tampa, FL, Nashville, TN, and Scottsdale, AZ. These clinic locations have various expiration dates through August 31, 2023. The leasing arrangements contain various renewal options that are adjusted for increases in the consumer price index or agreed upon rates. The Company entered into a twelve-month lease extension for its Tampa location beginning April 1, 2021 totaling $71,775. The Company also entered into a twelve-month lease extension for its Nashville location beginning November 1, 2021 totaling $94,500. The Dallas, TX lease expired on July 31, 2020 and the Pittsburgh, PA lease expired on October 31, 2020, neither of which were renewed as these clinic locations were permanently closed. The Company decided that its corporate staff will continue working remotely but the Company will have a small corporate meeting room in the Tampa LHI clinic. Note 5 - Property And Equipment Property and equipment, net, consists of the following: Schedule of Property and Equipment Useful Life September 30, 2021 December 31, 2020 Furniture and fixtures 5-7 years $96,185 $231,222 Computers and software 3-7 years 213,660 246,323 Leasehold improvements 15 years 40,130 155,583 Property and equipment 349,975 633,128 Less: accumulated depreciation (309,631) (493,953) Total $40,344 $139,175 Depreciation expense was approximately $300 and $14,000 for the three and nine months ended September 30, 2021, respectively. Depreciation expense was approximately $30,000 and $69,000 for the three and nine months ended September 30, 2020, respectively. The Company uses the straight-line depreciation method to calculate depreciation expense. The Company recorded a loss on disposal of approximately $0 and $93,000 for the three and nine months ended September 30, 2021, respectively. Note 6 Related Party Transactions Board Members and Officers and Related Expenses Effective February 1, 2019, the Company entered into an oral consulting agreement with Mr. Raymond Monteleone, Board Member and Chairman of the Audit Committee in which Mr. Monteleone received $10,000 per month for advisory services and $5,000 per quarter as Audit Committee Chair in addition to regular quarterly board meeting fees. Effective March 25, 2020, the Company reduced the advisory services to $5,000 per month and the fees per quarter as the Audit Committee Chair to $2,500 per quarter. On January 12, 2021, Mr. Monteleone was appointed as Chairman of the Board and Compensation Committee Chair. There are understandings between the Company and Mr. Monteleone for him to receive $5,000 per month to serve on the Board of Directors and an additional $2,500 per quarter to serve as Chairman of the Board, Audit Committee Chair, and Compensation Committee Chair. The Company expensed approximately $18,000 and $53,000 in compensation to Mr. Monteleone for the three and nine months ended September 30, 2021, respectively. The Company expensed approximately $18,000 and $65,000 in compensation to Mr. Monteleone for the three and nine months ended September 30, 2020, respectively. F-10 Effective October 1, 2020, the Company entered into an oral agreement with Mr. Michael Yurkowsky in which Mr. Yurkowsky will receive $4,167 per month to serve on the Board of Directors. The Company expensed approximately $13,000 and $38,000 in compensation to Mr. Yurkowsky for the three and nine months ended September 30, 2021, respectively. For the three and nine months ended September 30, 2020, the Company expensed $0. On January 12, 2021, Mr. William Horne stepped down as Chairman of the Board. Mr. Horne will remain a member of the Board. Effective March 1, 2021, the Company entered into an oral agreement with Mr. Horne in which Mr. Horne will receive $4,167 per month to serve on the Board of Directors. The Company expensed approximately $13,000 and $29,000 in Board fee compensation to Mr. Horne for the three and nine months ended September 30, 2021. For the three and nine months ended September 30, 2020, the Company expensed $0. Debt and Other Obligations The convertible notes payable and convertible notes payable, related parties are detailed in Note 3 - Liquidity, Going Concern and Management s Plans in this Form 10-Q. Change in Control On September 11, 2020, with the closing of the Rights Offering, FWHC, LLC, FWHC Bridge, LLC, and FWHC Bridge Friends, LLC (collectively known as FWHC ) gained control of the Company by subsequently owning approximately 61% of the fully diluted shares of the Company. On July 28, 2020, the Company issued an aggregate of 15,518,111 shares of its common stock to FWHC upon the conversion of its issued Series D Convertible Preferred Stock. The Preferred Stock was converted pursuant to a mandatory conversion triggered by the majority holder of the Series D Convertible Preferred Stock as set forth in the Certificate of Designations for the Series D Convertible Preferred Stock. On September 11, 2020, with the closing of the Rights Offering, FWHC was issued 123,031,819 shares of Preferred A Stock for conversion of the outstanding promissory notes from April 2020, 75,162,429 shares of Preferred A Stock for conversion of the April Secured Note, 35,860,079 shares of Preferred A Stock for conversion of the Hawes Notes, and 117,362,143 shares of Preferred A Stock issued upon the closing of the Rights Offering. FWHC was also issued 273,356,676 10-year warrants at $0.014 upon the closing of the Rights Offering. Convertible Notes Payable On April 1, 2021, the Company, entered into a Secured Convertible Note Purchase Agreement (the April 2021 Note Purchase Agreement ) with five (5) investors (the Holders ). Pursuant to the terms of the April 2021 Note Purchase Agreement, the Company sold promissory notes in the aggregate principal amount of $2,575,000 maturing on March 31, 2022 with an annual interest rate of 8%. The Notes are convertible into shares of Common Stock at a discount of 20% to the price paid for such New Securities in the next round of financing that meets the definition of Qualified Financing as defined in the April 2021 Note Purchase Agreement. The Notes are secured by the assets of the Company under a security agreement with the Holders. The lead investor of the April 2021 Note Purchase Agreement, FWHC Bridge, LLC, advanced $1,500,000 of the total amount to the Company. FWHC Bridge, LLC is an affiliated entity of FWHC, LLC, which is a principal stockholder and related party of the Company. An additional affiliate of FWHC, LLC provided an additional $25,000 as part of the April 2021 Note Purchase Agreement. On October 14, 2021, H-Cyte, Inc. (the Company ) entered into the Second Closing Bring Down Agreement (the October 2021 Note Purchase Agreement ) whereby the five (5) investors who had entered into the April 2021 Note Purchase Agreement purchased new notes in the Company in the aggregate principal amount of $750,000. The Notes are due and payable on March 31, 2022 and bear interest at an annual rate of 8%. The Notes are convertible into shares of Common Stock at a discount of 20% to the price paid for such New Securities in the next financing that meets the definition of a Qualified Financing as defined in the Note Purchase Agreement. The Notes are secured by all of the assets of the Company under a security agreement with the Holders. The lead investor of the October 2021 Note Purchase Agreement, FWHC Bridge, LLC, advanced $437,000 of the total amount to the Company. FWHC Bridge, LLC is an affiliated entity of FWHC, LLC, which is a principal stockholder and related party of the Company. An additional affiliate of FWHC, LLC provided an additional $7,500 as part of the October 2021 Note Purchase Agreement. Note 7 - Equity Transactions Common Stock Issuance In February 2020, the Company issued LilyCon Investments $35,000 in shares of the Company s common stock at a weighted average share price of $0.32 per share for a total of 109,375 shares per the terms of the consulting agreement executed in February 2019. F-11 On April 23, 2020, Horne Management, LLC agreed to convert the related notes plus accrued interest into (i) 4,368,278 shares of common stock of the Company and (ii) a ten-year warrant to purchase up to an equivalent number of shares of the Company s common stock with such conversion to be effective as of April 17, 2020. This warrant will have an exercise price equal to the price per share at which securities were offered to investors for purchase at the Qualified Financing, which was $0.014, and is exercisable beginning on the day immediately following the closing of the Rights Offering, which occurred on September 11, 2020. On July 28, 2020, the Company issued an aggregate of 17,893,076 shares of its common stock upon the conversion of all of its issued and outstanding Series B and Series D Preferred Stock (the Preferred Stock ) and accumulated dividends. The Preferred Stock was converted pursuant to a mandatory conversion triggered by the majority holder of the Series D Preferred Stock as set forth in the Certificate of Designations for the Series D Preferred Stock. On July 29, 2020, the Company filed its Second Amended and Restated Certificate of Incorporation (the Amended COI ). The Amended COI provides for the issuance of up to 1,600,000,000 shares of Common Stock and 1,000,000,000 shares of Preferred Stock, of which 800,000,000 shares are designated as Series A Preferred Stock and eliminates the previously authorized classes of preferred stock. The Amended COI also delineates the rights of the Series A Preferred Stock. Series A Preferred Stock On September 11, 2020, the registered Rights Offering (Registration No. 333-239629) of the Company expired. Pursuant to the Rights Offering, on September 24, 2020, the Company issued (i) 15,235,381 shares of its Series A preferred stock at a price of $0.014 per share to holders of its common stock who validly exercised their subscription rights prior to the expiration time and (ii) 203,049,643 shares of its Series A preferred stock to the standby purchasers as part of the standby commitment. The Rights Offering, including the standby component, resulted in gross proceeds to the Company of $3,055,985. Additionally, on September 24, 2020, the Company issued an aggregate of 323,844,416 shares of its Series A Preferred Stock to the holders of outstanding promissory notes, issued in April 2020, in the aggregate principal amount and accrued interest of $4,483,617. The notes were converted pursuant to a mandatory conversion triggered by the completion of the Rights Offering (for further discussion, see Note 9 - Equity Transactions to the consolidated financial statements in the Company s 2020 Annual Report on Form 10-K). During the three and nine months ended September 30, 2021, 4,431,530 and 22,235,055 shares of Series A Preferred Stock were converted to Common Stock at the request of certain Series A Preferred Shareholders. Voting Rights Holders of Series A Preferred Stock ( Series A Holders ) have the right to receive notice of any meeting of holders of common stock and to vote upon any matter submitted to a vote of the holders of common stock. Each Series A Holder shall vote on each matter on an as converted basis submitted to them with the holders of common stock. Conversion Series A Preferred Stock converts to common stock at a 1:1 ratio immediately upon request of the Series A Holder. Liquidation Series A Preferred Stock does not have preferential treatment over common stock shareholders if the Company liquidates or dissolves. F-12 Share-Based Compensation The Company utilizes the Black-Scholes valuation method to recognize share-based compensation expense over the vesting period. The expected life represents the period that the stock-based compensation awards are expected to be outstanding. Stock Option Activity On April 1, 2021, the Board of Directors of the Company approved and granted to certain directors and officers of the Company an aggregate of 54,750,000 stock options of which 4,750,000 were immediately vested on the date of grant. Each option granted has an exercise price of $0.07 per share and an expiration date of ten years from the date of grant. These options are not included in the Company s current stock option plan as they were granted outside of the plan. The Board of Directors decided not to renew the former CEO s (Robert Greif) employment contract; therefore, the unvested shares were forfeited resulting in a reduction of share-based compensation of approximately $205,000 for the period ending September 30, 2021 that was recognized during the period ending June 30, 2021. For the nine months ended September 30, 2020, all outstanding stock options were fully vested, and related compensation expense recognized. For the nine months ended September 30, 2021, 29,635,000 options were outstanding and 14,801,667 were vested. For the three and nine months ended September 30, 2021 the Company recognized approximately $162,000 and $1,024,000 in stock-based compensation expense, respectively. The Company has approximately $574,000 of unrecognized compensation costs related to non-vested stock options, which is expected to be recognized over a weighted average period of approximately 3.12 years. Inputs used in the valuation models are as follows: Schedule of Assumptions Used to Calculate Fair Value of Stock Options 2021 Grants Option value $0.054 to 0.056 Risk Free Rate 0.90% to 1.37% Expected Dividend- yield - to - Expected Volatility 173.99% to 176.04% Expected term (years) 5 to 7 The following is a summary of stock option activity for the nine months ended September 30, 2020 and 2021: Summary of Stock Option Activity Shares Weighted Average Exercise Price Weighted Average Remaining Term (Years) Outstanding at December 31, 2019 425,000 $1.38 7.71 Granted - - - Expired/Cancelled (15,000) 1.35 - Outstanding and exercisable at September 30, 2020 410,000 $1.39 7.23 Outstanding at December 31, 2020 410,000 $1.39 6.72 Granted 54,750,000 0.07 9.50 Expired/Cancelled (25,525,000) 0.07 - Outstanding at September 30, 2021 29,635,000 $0.10 9.41 Exercisable at September 30, 2021 14,801,667 $0.10 9.41 The following is a summary of the Company s non-vested shares for the nine months ended September 30, 2021: Summary of Stock Option Activity Non-vested Shares Weighted Average Grant Date Fair Value Non-vested at December 31, 2020 - - Granted 54,750,000 0.03 Vested (14,416,667) 0.05 Forfeited (25,500,000) 0.07 Non-vested at September 30, 2021 14,833,333 0.11 Non-Controlling Interest For the nine months ended September 30, 2021 and 2020, the Company consolidated the results for LI Dallas, LI Nashville, LI Pittsburgh, and LI Scottsdale as VIEs. The Company owns no portion of any of these four entities, however, the Company maintains control through their management role for each of the clinics, in accordance with each clinic s respective management services agreement. Based on these agreements, the Company has the responsibility to run and make decisions on behalf of the clinics, except for medical care and procedures. Beginning in January 2018, the Company adopted the policy, for all of the VIEs, that the management fee charged by the Company would equal the amount of net income from each VIE on a monthly basis, bringing the amount of the net income to $0 each month for the VIEs. Due to this change in policy, there was no change in the non-controlling interest for the nine months ended September 30, 2021 or 2020 related to the net income (loss) as it was $0 each month through the management fee charged by the Company. The LI Dallas and LI Pittsburgh clinics did not reopen in 2020 after the temporary closure of all LI clinics due to COVID-19. These two clinics will remain permanently closed. Net Loss Per Share Basic loss per share is computed on the basis of the weighted average number of shares outstanding for the reporting period. Diluted loss per share is computed on the basis of the weighted average number of common shares plus dilutive potential common shares outstanding using the treasury stock method. Any potentially dilutive securities are antidilutive due to the Company s net losses. The Company excluded the following securities from the calculation of basic and diluted net loss per share as the effect would have been antidilutive: Schedule of Anti-dilutive Securities of Basic and Diluted Net Loss Per Share 2021 2020 For the Nine Months Ended September 30, 2021 2020 Warrants to purchase common stock (in the money) 385,033,082 367,515,043 Series A Preferred Stock convertible to common stock 515,874,354 542,129,440 Total 900,907,436 909,644,483 Excluded from the above table are 22,607,701 warrants and 29,635,000 stock options for the nine months ended September 30, 2021 as they are out of the money (exercise price greater than $0.04). Inclusion of such would be anti-dilutive. F-13 Note 8 Commitments & Contingencies Litigation From time to time, the Company may be involved in routine legal proceedings, as well as demands, claims and threatened litigation that arise in the normal course of our business. The ultimate amount of liability, if any, for any claims of any type (either alone or in the aggregate) may materially and adversely affect the Company s financial condition, results of operations, and liquidity. In addition, the ultimate outcome of any litigation is uncertain. Any outcome, whether favorable or unfavorable, may materially and adversely affect the Company due to legal costs and expenses, diversion of management attention, and other factors. The Company expenses legal costs in the period incurred. The Company cannot assure that additional contingencies of a legal nature or contingencies having legal aspects will not be asserted against the Company in the future, and these matters could relate to prior, current, or future transactions or events. As of September 30, 2021, the Company had no litigation matters which required any accrual or disclosure. Rion Agreements On June 21, 2019, H-CYTE entered into an exclusive product supply agreement with Rion, LLC ( Rion ) to develop and distribute (post FDA approval) a biologic for chronic obstructive pulmonary disease ( COPD ), the fourth leading cause of death in the U.S. Rion has established a novel biologics technology to harness the healing power of the body. Rion s innovative technology, based on science developed at Mayo Clinic, provides an off-the-shelf platform to enhance healing in soft tissue, musculoskeletal, cardiovascular and neurological organ systems. This agreement provides for a 10-year exclusive and extendable supply agreement with Rion to enable H-CYTE to develop proprietary biologics. The Company is currently evaluating the potential of a combined biologic and the utilization of this agreement. On October 9, 2019, the Company entered into a services agreement with Rion which provides the Company the benefit of Rion s resources and expertise for the limited purpose of (i) consulting with and assisting H-CYTE in the further research and development for the generation of a new biologic and (ii) subsequently assisting H-CYTE in seeking and obtaining FDA Phase 1 IND clearance for this biologic as necessary. Rion also agrees to consult with H-CYTE in its arrangement for services from third parties unaffiliated with Rion to support research, development, regulatory approval, and commercialization of the biologic. For the three and nine months ended September 30, 2021 the Company expensed $0. For the three and nine months ended September 30, 2020 the Company expensed $202,000 and $1,152,000, respectively. The Company is currently evaluating the potential of a combined biologic and the utilization of this agreement. F-14 Note 9 Short-term Debt Convertible Notes Payable Convertible Notes payable represents a securities purchase agreement with select accredited investors, which was assumed in the Asset Purchase Agreement between Medovex Corp and Regenerative Medicine Solutions, LLC ( Merger ) in 2019 (see Note 1 Description of the Company to the consolidated financial statements in the Company s 2020 Annual Report on Form 10-K). The debt assumed by the Company, as part of the merger, consisted of $750,000 of units (the Units ) with a purchase price of $50,000 per Unit. Each Unit consists of (i) a 12% senior secured convertible note, initially convertible into shares of the Company s common stock, par value $0.001 per share, at a conversion price equal to the lesser of $0.40 or ninety percent (90%) of the per share purchase price of any shares of common stock or common stock equivalents issued in future private placements of equity and/or debt securities completed by the Company following this offering, and (ii) a three-year warrant to purchase such number of shares of the Company s common stock equal to one hundred percent (100%) of the number of shares of common stock issuable upon conversion of the notes at $0.40. The Convertible Notes were secured by all of the assets of the Company. In 2019, $100,000 of the Convertible Notes were converted into shares of common stock, and $350,000 of the Convertible Notes were redeemed by the Company. The Company reached an extension with the remaining noteholder which extended the maturity date of the Hawes Notes for one year, until September 30, 2020. The notes had a principal balance of $300,000 plus penalties of approximately $85,000 and accrued interest of approximately $40,000 for a total adjusted principal balance upon renewal of $424,615 as of March 31, 2020. In connection with the April Offering, the Company entered into an amendment with the Investor with respect to the outstanding 12% Senior Secured Convertible Note due September 30, 2020, which was originally issued in 2018 and assumed in the Merger and which was purchased by the Investor from its original holder, George Hawes, on March 27, 2020 (see Note 11 Debt to the consolidated financial statements in the Company s 2020 Annual Report on Form 10-K). On April 1, 2021, the Company, entered into a Secured Convertible Note Purchase Agreement (the April 2021 Note Purchase Agreement ) with five (5) investors (the Holders ). Pursuant to the terms of the April 2021 Note Purchase Agreement, the Company sold promissory notes in the aggregate principal amount of $2,575,000 maturing on March 31, 2022 with an annual interest rate of 8%. The Notes are convertible into shares of Common Stock at a discount of 20% to the price paid for such New Securities in the next round of financing that meets the definition of Qualified Financing as defined in the April 2021 Note Purchase Agreement. The Notes are secured by the assets of the Company under a security agreement with the Holders. The lead investor of the April 2021 Note Purchase Agreement, FWHC Bridge, LLC, advanced $1,500,000 of the total amount to the Company. FWHC Bridge, LLC is an affiliated entity of FWHC, LLC, which is a principal stockholder and related party of the Company. An additional affiliate of FWHC, LLC provided an additional $25,000 as part of the April 2021 Note Purchase Agreement. Interest expense is being accreted to the principal balance using the effective interest method. For the three months and nine months ended September 30, 2021, the Company recorded interest expense of $30,445 for related party convertible notes payable and $20,962 for convertible notes payable and $59,665 for related party convertible notes payable and $41,080 for convertible notes payable, respectively. Notes Payable Notes payable were assumed in the Merger and are due in aggregate monthly installments of approximately $5,800 and carry an interest rate of 5%. Each note originally had a maturity date of August 1, 2019. The Company finalized an eighteen-month extension to March 1, 2021. The Company is working with the lender for an additional extension of the promissory notes. The promissory notes have an aggregate outstanding balance of approximately $67,000 at September 30, 2021 and December 31, 2020. The Company has not made payments on this note since February 10, 2020, due to COVID-19, resulting in accrued interest of approximately $5,000. On March 27, 2020, the Company issued a demand note in the principal amount of $500,000 to FWHC Bridge, LLC (the Investor ) in exchange for a loan made by the Investor in such amount to cover the Company s working capital needs. Subsequently on April 9, 2020, in exchange for an additional loan of $500,000 made by the Investor to the Company, the Company amended and restated the demand note to reflect a new principal amount of $1,000,000, which became the A&R Note (see Note 11- Debt to the consolidated financial statements in the Company s 2020 Annual Report on Form 10-K). F-15 Paycheck Protection Program On April 29, 2020, the Company issued a promissory note in the principal amount of $809,082 to the Bank of Tampa in connection with a loan in such amount made under the Paycheck Protection Program ( PPP Loan ). The PPP Loan bears an interest rate of 1% per annum and matures on April 29, 2022. The Company elected to use a 24-week Covered Period, per the SBA Paycheck Protection Program guidelines, which ended on October 14, 2020. The Company could apply for loan forgiveness in an amount equal to the sum of the following costs incurred by the Company: 1) payroll costs; 2) any payment of interest on covered mortgage obligations; 3) any payment on a covered rent obligation; and 4) any covered utility payment The Company received notification from the Small Business Administration ( SBA ), dated August 17, 2021, notifying it that $689,974 in principal and $8,847 in interest was forgiven under the guidelines of the Paycheck Protection Program. As of September 30, 2021, the current balance is $105,878 with $405 in interest payable. Note 10 Derivative Liabilities The Company s derivative liabilities are classified within Level 3 of the fair value hierarchy because certain unobservable inputs were used in the valuation models. These assumptions included estimated future stock prices, potential down-round financings for the Warrants, and potential redemptions for the Redemption Put Liability. The following are rollforwards of the liabilities during the nine months ended September 30, 2020: Schedule of Fair Value, Liabilities Measured On Recurring Basis Derivative Liability - Warrants Balance at December 31, 2019 $315,855 Series D Warrant reclass from equity to liability classification 509,762 Warrants issued with modification of Horne Note 198,994 Warrants issued with April 17, 2020 financing 6,148,816 Fair value adjustments (2,986,853) Warrant reclassification from liability to equity classification (4,186,574) Balance at September 30, 2020 $ F-16 Redemption Put Liability Balance at December 31, 2019 $267,399 Issuance of Series D Convertible Preferred Stock 5,306 Fair value adjustments (272,705) Balance at September 30, 2020 $ (1) The Company did not have any assets or liabilities measured at fair value using Level 1 or 2 of the fair value hierarchy as of September 30, 2020. (2) Upon the closing of a Qualified Financing on September 11, 2020, the Derivative Liability- Warrants were reclassed to stockholder s equity. (3) The Series D Preferred Stock was converted into common stock on July 28, 2020 at which time the Derivative Put Liability was no longer applicable, and its fair value as adjusted to zero and the extinguishment was recorded to income. Derivative Liability- Warrants Series B Warrants As part of the April 2020 Offering, the holders of the Series B Warrants agreed to terminate anti-dilution price protection in their warrants and adjusted the exercise price to equal the price per share at which shares of preferred stock are offered for purchase in a Qualified Financing. The modification resulted in an increase of approximately $75,000 to the fair value of the derivative liability related to the Series B Warrants. In addition, the Company recorded a change in fair market value of approximately $317,000 to the fair value of the derivative liability before the reclass to equity. Upon the closing of a Qualified Financing, which occurred on September 11, 2020, the exercise price of the Series B Warrants became fixed at $0.014 and the warrants then met the conditions for equity classification. Consequently, they were revalued as of the date of the Qualified Financing using a Black Scholes valuation technique with the following assumptions: Trading market price - $0.027, estimated exercise price - $0.014, volatility - 260%, risk free rate - 0.13% and an estimated remaining term of 1.33 years. The fair value of the Series B Warrants totaling $73,805 was then reclassed from a derivative liability to stockholders equity. Series D Warrants In conjunction with the Series D Preferred Financing, the Company originally issued Series D warrants to purchase 14,669,757 shares of Common Stock with an exercise price of $0.75 per share. At inception, the Series D warrants met all the criteria to be classified as equity. As part of the April 2020 Offering, the exercise price of the Series D Warrants was reduced to the price per share at which shares of preferred stock are offered for purchase in a Qualified Financing. The modification of the exercise price resulted in the warrants requiring liability classification. The Series D Warrants were measured at fair value before and after the modification, resulting in a fair market value of approximately $510,000 when the warrants were reclassified to a liability on July 28, 2020. Upon the closing of a Qualified Financing, which occurred on September 11, 2020, the exercise price of the Series D Warrants became fixed at $0.014 and the warrants then met the conditions for equity classification. Consequently, the Series D Warrants were revalued as of the date of the Qualified Financing using a Black Scholes valuation technique with the following assumptions: Trading market price - $0.027, estimated exercise price - $0.014, volatility - 111%, risk free rate - 0.67% and an estimated term of 9.2 years. The fair value of the Series D Warrants totaling $337,400 was then reclassed from a derivative liability to stockholders equity. Horne Warrants On April 23, 2020, Horne Management, LLC agreed to convert the related notes plus accrued interest into (i) 4,368,278 shares of common stock of the Company and (ii) a ten-year warrant to purchase up to an equivalent number of shares of the Company s common stock with such conversion to be effective as of April 17, 2020. The warrant will have an exercise price equal to the price per share at which securities are offered to investors for purchase at the Qualified Financing. The revised exercise price caused the warrants to require liability classification at fair value and the warrants were valued using a Lattice model with the following assumptions: Trading market price- $0.05, estimated exercise price- $0.014, volatility- 101%, risk free rate- 0.65% and an estimated term of 10 years. At inception, the estimated fair value of the Horne Warrants was approximately $199,000. Upon the closing of a Qualified Financing, which occurred on September 11, 2020, the exercise price of the Series D Warrants became fixed at $0.014 and the warrants then met the conditions for equity classification. Consequently, the Horne Warrants were revalued as of the date of the Qualified Financing using a Lattice valuation technique with the following assumptions: Trading market price- $0.027, estimated exercise price- $0.014, volatility- 103%, risk free rate- 0.67% and an estimated term of 10 years. The fair value of the Horne Warrants totaling $107,123 was then reclassed from a derivative liability to stockholders equity. April Bridge Loan and Converted Advance Warrants The April 2020 Offering entitled the investors to warrants with the right to purchase up to 100% of the aggregate number of shares of Common Stock into which the Purchaser s Note may ultimately be converted. The Company also received a $1,000,000 advance which was converted into a Converted Advance Note and Converted Advance Warrants in April 2020. The Converted Advance Warrants entitle the holder to purchase up to 200% of the aggregate number of shares of Common Stock into which the Converted Advanced Note may ultimately be converted. The Company received an aggregate of $2,842,695 in gross proceeds through the April Offering and an advance of $1,000,000 (A&R Note) which was converted into an Advance Note on April 17, 2020. The Company expected the price per share at which securities would be offered for purchase in the Qualified Financing to be $0.014 resulting in the assumption there would be approximately 203,050,000 and 142,857,000 shares issuable upon exercise of the Purchaser Warrants and the Converted Advance Warrants, respectively. The warrants were valued using a Lattice model with the following assumptions: Trading market price - $0.05, estimated exercise price - $0.014, volatility - 103%, risk free rate- 0.65% and an estimated term of 10 years. At inception, the estimated fair value of the Purchaser Warrants and the Converted Advance Warrants was approximately $3,279,000 and $2,869,000, respectively for a total of approximately $6,149,000. Upon the closing of a Qualified Financing, which occurred on September 11, 2020, the exercise price of the Purchaser and Converted Advance Warrants became fixed at $0.014 and the Company then had sufficient authorized and unissued shares available to satisfy all their commitments under their equity-linked contracts. There are 212,821,929 and 150,324,857 shares issuable upon exercise of the Purchaser and the Converted Advance Warrants, respectively. The Warrants were revalued as of the date of the Qualified Financing using a Lattice valuation technique with the following assumptions: Trading market price - $0.027, estimated exercise price - $0.014, volatility - 107%, risk free rate - 0.67% and an estimated term of 10 years. The fair value of the Warrants of $3,668,247 was then reclassed from a derivative liability to stockholders equity. When the Company entered into the April Offering and revised the exercise price of their warrants to the price per share at which shares of preferred stock are offered for purchase in a Qualified Financing, they no longer had sufficient authorized and unissued shares available to satisfy all their commitments to issue shares under their equity-linked contracts. The Company adopted the sequencing approach based on the earliest issuance date. Therefore, warrants issued before the April Offering did not require liability classification, while Warrants issued with the April financing, or subsequently, were classified as liabilities until such time the Company had sufficient authorized shares. At December 31, 2019, due to the down round provision contained in the warrants, which could provide for the issuance of additional warrant shares as well as a reduction in the exercise price, the model also considered subjective assumptions related to the shares that would be issued in a down-round financing and the potential adjustment to the exercise price. On April 17, 2020, the holders of the warrants agreed to terminate all anti-dilution price protections in their warrants. F-17 The derivative liability has been remeasured to fair value at the end of each reporting period and the change in fair value, of approximately $5,869,102 and ($2,986,853), has been recorded as a component of other income (expense) in the Company s consolidated statement of operations for the three and nine months ended September 30, 2020, respectively. For the three month period ended September 30, 2020, the derivative liability has been remeasured to fair value at September 11, 2020 and then converted to equity due to the Qualified Financing and fixed as all derivative liabilities were converted. The fair value of the derivative liability included on the consolidated balance sheet was approximately $0 and $316,000 as of September 30, 2020 and December 31, 2019, respectively. In conjunction with the Series D Preferred financing (See Note 12), the Company offered the Series B warrant holders the option to exchange their warrants on the basis of 1 warrant for 0.40 common shares. Warrant holders chose to exchange 1,007,813 warrants with a fair value of approximately $75,000 for 403,125 shares of common stock with a fair value of approximately $73,000. On the date of the exchange, the Series B Warrants were first adjusted to fair value with the change in fair value being recorded in earnings. Redemption Put Liability As described in Note 12, the redemption put provision embedded in the Series D financing required bifurcation and measurement at fair value as a derivative. If the redemption put provision is triggered, it allows either payment in cash or the issuance of Trigger Event Warrants . Accordingly, the fair value of the Redemption put liability considered management s estimate of the probability of cash payment versus payment in Trigger Event Warrants and was valued using a Monte Carlo Simulation which uses randomly generated stock-price paths obtained through a Geometric Brownian Motion stock price simulation. The fair value of the redemption provision was significantly influenced by the fair value of the Company s stock price, stock price volatility, changes in interest rates and management s assumptions related to the redemption factor. On July 28, 2020, the Series D Preferred Stock was converted into Common Stock, at which time the redemption put was no longer applicable and the fair value of the redemption put was adjusted to zero. The fair market value of the redemption put liability at inception was approximately $614,000 which was recorded as a liability and remeasured to fair value at the end of each reporting period. The change in fair value of approximately $98,000 and $273,000 has been recorded as a component of other income (expense) in the Company s consolidated statement of operations for the three and nine months ended September 30, 2020, respectively. The fair value of the redemption put liability included on the consolidated balance sheet was approximately $0 and $267,000 as of September 30, 2020 and December 31, 2019, respectively. The Company did not have any assets or liabilities measured at fair value using Level 1 or 2 of the fair value hierarchy as of December 31, 2020 (see Note 12- Derivative Liability-Warrants and Redemption Put to the consolidated financial statements in the Company s 2020 Annual Report on Form 10-K). Note 11 - Common Stock Warrants A summary of the Company s warrant issuance activity and related information for the period ended September 30, 2021 and 2020 is as follows: Summary of Warrant Activity Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life Outstanding and exercisable at December 31, 2019 44,806,076 $0.78 4.59 Issued 368,325,486 0.015 10.30 Total outstanding at September 30, 2020 413,131,562 0.09 9.79 Outstanding and exercisable at December 31, 2020 413,423,972 $0.015 10.30 Expired (5,783,189) $0.33 Issued Total outstanding and exercisable at September 30, 2021 407,640,783 $0.58 8.42 F-18 The fair value of all warrants issued are determined by using the Black-Scholes valuation technique and were assigned based on the relative fair value of both the common stock and the warrants issued. The inputs used in the Black-Scholes valuation technique to value each of the warrants as of their respective issue dates are as follows: Schedule of Assumptions for Warrants Event Description Date Number of Warrants H-CYTE Stock Price Exercise Price of Warrant Grant Date Fair Value Life of Warrant Risk Free Rate of Return (%) Annualized Volatility Rate (%) Short-term note, related party 1/13/2020 268,571 $0.12 $0.75 $0.07 3 years 1.60 145.76 Private placement of Series D Convertible Preferred Stock 1/17/2020 244,996 $0.15 $0.75 $0.13 10 years 1.84 144.30 Granted for bridge financing 4/8/2020 296,875 $0.05 $0.40 $0.04 3 years 0.34 131.82 Short-term note, related party conversion 4/17/2020 4,368,278 $0.05 $0.014 $0.05 10 years 0.65 100.64 Granted for bridge financing 9/11/2020 364,439,176 $0.05 $0.014 $0.017 10 years 0.65 96.97 The methods described above may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. Furthermore, while the Company believes its valuation methods are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different fair value measurement at the reporting date. Note 12 - Series D Convertible Preferred Stock On November 15, 2019, the Company entered into a securities purchase agreement with selected accredited investors whereby the Company offered (i) up to 238,871 shares of Series D Convertible Preferred Stock the ( Series D Shares ) at a price of $40.817 per share and (ii) a ten-year warrant (the Series D Warrant ) to purchase 14,669,757 shares of common stock. The Series D Warrants are exercisable for a period of 10 years from issuance at an initial exercise price of $0.75 per share, subject to adjustment for traditional equity restructurings and reorganizations. On November 21, 2019, the Company entered into a securities purchase agreement with FWHC Holdings, LLC ( FWHC ) an accredited investor for the purchase of 146,998 shares of Series D Convertible Preferred Stock, par value $0.001 per share and the Series D Warrant (the FWHC Investment ; see note 14 - Mezzanine Equity and Series D Convertible Preferred Stock to the consolidated financial statements in the Company s 2020 Annual Report on Form 10-K). For the nine months ended September 30, 2021 and 2020, the Company recorded $0 and $278,476, respectively, in deemed dividends on the Series D Convertible Preferred Stock in accordance with the 8% stated dividend resulting in a total balance of Series D Convertible Preferred stock of $6,281,433 at September 30, 2020. All outstanding shares of Series D Convertible Preferred Stock were converted into 15,773,363 shares of Common Stock on July 28, 2020. The conversion was pursuant to a mandatory conversion triggered by the majority holder of the Series D Convertible Preferred Stock as set forth in the Certificate of Designations. As of December 31, 2020, the Company does not have any Series D Convertible Preferred Stock outstanding (see Note 9 - Equity Transactions to the consolidated financial statements in the Company s 2020 Annual Report on Form 10-K). Schedule of Shares Outstanding Note 13 Income Taxes The Company utilizes the liability method of accounting for income taxes as set forth in FASB ASC Topic 740, Income Taxes . Under the liability method, deferred taxes are determined based on temporary differences between the financial statement and tax bases of assets and liabilities using tax rates expected to be in effect during the years in which the difference turns around. The Company accounts for interest and penalties on income taxes as income tax expense. A valuation allowance is recorded when it is more likely than not that a tax benefit will not be realized. In determining the need for valuation allowances the Company considers projected future taxable income and the availability of tax planning strategies. From inception to September 30, 2021, the Company has incurred net losses and, therefore, has no current income tax liability. The net deferred tax asset generated by these losses is fully offset by a valuation allowance as of September 30, 2021 and December 31, 2020. Management of the Company evaluated the positive and negative evidence bearing upon the realizability of its deferred tax assets and determined that it is more likely than not that the Company will not recognize the full benefits of the deferred tax assets. The Company s policy is to record interest and penalties on uncertain tax positions as a component of income tax expense. There are no uncertain tax positions at September 30, 2021 and December 31, 2020. The Company has not undergone any tax examinations since inception. Deferred tax assets and liabilities consist of the following at December 31: Schedule of Deferred Tax Assets and Liabilities Note 14 - Subsequent Events The Company has evaluated subsequent events through November 11, 2021 and has determined that there have been no events that would require adjustments to or disclosure in the September 30, 2021 interim Consolidated Financial Statements other than those disclosed in this Form 10-Q. On October 14, 2021, H-Cyte, Inc. (the Company ) entered into the Second Closing Bring Down Agreement (the October 2021 Note Purchase Agreement ) whereby the five (5) investors who had entered into the April 2021 Note Purchase Agreement purchased new notes in the Company in the aggregate principal amount of $750,000. The Notes bear an annual interest rate of 8% and are due and payable on March 31, 2022. The Notes are convertible into shares of Common Stock at a discount of 20% of the price paid for such New Securities in the next financing that meets the definition of a Qualified Financing as defined in the April 2021 Note Purchase Agreement. The Notes are secured by all the assets of the Company under a security agreement with the Holders. The lead investor of the October 2021 Note Purchase Agreement, FWHC Bridge, LLC, advanced $437,000 of the total amount to the Company. FWHC Bridge, LLC is an affiliated entity of FWHC, LLC, which is a principal stockholder and related party of the Company. An additional affiliate of FWHC, LLC provided an additional $7,500 as part of the October 2021 Note Purchase Agreement. F-19 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Shareholders and Board of Directors of H-CYTE, Inc. Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of H-CYTE, Inc. (the Company ) as of December 31, 2020 and 2019, and the related consolidated statements of operations, stockholders deficit and cash flows for the years then ended, and the related notes (collectively referred to as the consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of their operations and cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America. Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 3 to the consolidated financial statements, the Company has negative working capital, has an accumulated deficit, has a history of significant operating losses, and has a history of negative operating cash flow. These factors raise substantial doubt about the Company s ability to continue as a going concern. Management s plans regarding this matter are also discussed in Note 3. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion These consolidated financial statements are the responsibility of the Company s management. Our responsibility is to express an opinion on the Company s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ( PCAOB ) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Debt and equity accounting considerations As described in Notes 9, 12 and 14 to the consolidated financial statements, the Company had various debt and equity transactions that required accounting considerations, significant estimates and judgements around certain features and the possibility of conversion or redemption, the valuation of certain components of the financings, including the valuation around certain freestanding and embedded derivatives. The Company determined that warrants issued in connection with certain financings required derivative liability classification. These warrants were initially measured at fair value and subsequently have been remeasured to fair value at each reporting period, prior to their reclassification to equity in September 2020 at the close of the Company s Series A Preferred Stock Rights Offering. The Company determined that due to the nature of the financing features, mezzanine equity classification was appropriate for the Series D Convertible preferred stock itself and the redemption put required derivative liability classification. The redemption put liability was initially measured at fair value and subsequently has been remeasured at fair value at each reporting period, prior to their reclassification to equity in July 2020 when the Series D Convertible Preferred Stock was called and converted to common stock. There is no current observable market for these types of derivatives and, as such, the Company determined the fair value of the freestanding instruments or embedded derivatives using the Black-Scholes-Merton option pricing model or a binomial lattice model to measure the fair value of the debt and/or equity instrument both with and without the embedded feature. We identified the accounting considerations and related valuations, including the related fair value determinations of the various debt and equity financings and classification of such as a critical audit matter. The principal considerations for our determination were: (1) the accounting consideration in determining the nature of the various features and weighting of evidence (2) the evaluation of the potential derivatives and potential bifurcation in the instruments, and (3) considerations related to the determination of the fair value of the various debt and equity instruments and the conversion and redemption features that include complex valuation models and assumptions utilized by management. Auditing these elements is especially challenging and requires auditor judgement due to the nature and extent of audit effort required to address these matters, including the extent of specialized skill or knowledge needed. Changes in the accounting determinations and the related valuation assumptions can have a significant impact on the valuation of the embedded and freestanding derivative liabilities. For example, all other things being equal, generally, an increase in the Company s stock price, change of control probability, risk-adjusted yields term to maturity/conversion or stock price volatility increases the value of the derivative liability. Our audit procedures related to management s conclusion on the evaluation and related valuation of freestanding and embedded derivatives, included the following, among others: (1) Utilized personnel with specialized knowledge and skill in technical accounting to assist in: (i) evaluating the relevant terms and conditions of the various financings, and (ii) assessing the appropriateness of conclusions reached by the Company with respect to the accounting for the convertible debt/equity, and the assessment and accounting for potential derivatives. (2) We used a valuation specialist to assist us in evaluating the Company s models, valuation methodology, and significant assumptions used in the fair value estimates. /s/ Frazier & Deeter, LLC Tampa, Florida March 25, 2021 We have served as the Company s auditor since 2018. F-20 H-Cyte, Inc Consolidated Balance Sheets (Audited) 2020 2019 December 31, 2020 2019 Assets Current Assets Cash $1,640,645 $1,424,096 Accounts receivable - 22,667 Other receivables 22,123 18,673 Prepaid expenses 94,434 810,143 Total Current Assets 1,757,202 2,275,579 Right -of-use asset 278,552 738,453 Property and equipment, net 139,175 219,703 Other assets 29,239 36,877 Total Assets $2,204,168 $3,270,612 Liabilities, Mezzanine Equity, and Stockholders Deficit Current Liabilities Interest payable $6,898 $53,198 Accounts payable 1,006,968 1,485,542 Accrued liabilities 276,415 324,984 Other current liabilities 154,812 175,181 Short-term notes, related party - 1,635,000 Short-term convertible notes payable - 424,615 Notes payable, current portion 67,444 66,836 Dividend payable - 108,641 PPP Loan, current portion 606,811 - Deferred revenue 634,149 1,046,156 Lease liability, current portion 139,189 453,734 Total Current Liabilities 2,892,686 5,773,887 Long-term Liabilities Lease liability, net of current portion 157,050 302,175 Notes payable, net of current portion - 11,545 Derivative liability - warrants - 315,855 Redemption put liability - 267,399 PPP Loan, net of current portion 202,271 - Total Long-term Liabilities 359,321 896,974 Total Liabilities 3,252,007 6,670,861 Commitments and Contingencies (Note 10) - - Mezzanine Equity Series D Convertible Preferred Stock - $.001 par value: 238,871 shares authorized, 0 shares and 146,998 shares issued and outstanding at December 31, 2020 and 2019, respectively - 6,060,493 Total Mezzanine Equity Stockholders Equity (Deficit) Series A Preferred Stock - $.001 par value: 1,000,000,000 shares authorized, 538,109,409 and 0 shares issued and outstanding at December 31, 2020 and, 2019, respectively 538,109 - Series B Convertible Preferred Stock - $.001 par value: 10,000 shares authorized; 0 and 6,100 shares issued and outstanding at December 31, 2020 and 2019, respectively - 6 Common stock - $.001 par value: 1,600,000,000 shares authorized, 127,159,464 and 99,768,704 shares issued and outstanding at December 31, 2020 and 2019, respectively 127,159 99,769 Additional paid-in capital 42,515,999 28,172,146 Accumulated deficit (43,858,974) (37,362,531) Non-controlling interest (370,132) (370,132) Total Stockholders Deficit (1,047,839) (9,460,742) Total Liabilities, Mezzanine Equity and Stockholders Deficit $2,204,168 $3,270,612 The accompanying notes are an integral part of these financial statements. F-21 H-Cyte, Inc Consolidated Statements of Operations 2020 2019 December 31, 2020 2019 Revenues $2,150,672 $8,346,858 Cost of Sales (766,957) (2,052,807) Gross Profit 1,383,715 6,294,051 Operating Expenses Salaries and related costs $3,198,867 $8,646,471 Other general and administrative 3,746,784 6,847,335 Research and development 1,152,065 106,214 Advertising 296,873 4,909,724 Loss on impairment - 15,508,401 Depreciation and amortization 81,470 834,291 Total Operating Expenses 8,476,059 36,852,436 Operating Loss (7,092,344) (30,558,385) Other Income (Expense) Other expense (86,816) (124,118) Interest expense (1,462,750) (299,331) Change in fair value of redemption put liability 272,704 346,696 Change in fair value of derivative liability - warrants 2,986,854 827,260 Gain on extinguishment of short-term notes, related party 1,300,088 - Warrant modification expense (70,851) - Loss on derivative instrument (2,306,121) - Total Other Income (Expense) 633,108 750,507 Net Loss $(6,459,236) $(29,807,878) Accrued dividends on Series B Convertible Preferred Stock 44,456 84,939 Finance costs on issuance of Series D Convertible Preferred Stock - 66,265 Deemed dividend on adjustment to exercise price on convertible debt and certain warrants - 287,542 Deemed dividend on Series D Convertible Preferred Stock 277,719 2,916,813 Deemed dividend on beneficial conversion features - 32,592 Net Loss attributable to common stockholders $(6,781,411) $(33,196,029) Loss per share - Basic and diluted $(0.06) $(0.34) Weighted average outstanding shares - basic and diluted 111,491,261 96,370,562 The accompanying notes are an integral part of these financial statements. F-22 H-Cyte, Inc Consolidated Statements of Stockholders Deficit For the years ended December 31, 2020 and 2019 Shares Amount Shares Amount Shares Amount Capital Deficit Interest Deficit Preferred Series A Stock Preferred Series B Stock Common Stock Additional Paid-in Accumulated Non-Controlling Total Stockholders Shares Amount Shares Amount Shares Amount Capital Deficit Interest Deficit Balances - December 31, 2018 $ $ 33,661,388 $33,661 $3,566,339 $(9,296,408) $(370,132) $(6,066,540) Purchase accounting adjustments 9,250 9 24,717,270 24,717 12,657,182 12,681,908 Adjustment of exercise price on certain warrants Reclassification of Series B warrants to equity Reclassification of Series D warrants to equity Conversion of Series B Convertible Preferred Stock to Common Stock Conversion of Series B Convertible Preferred Stock to Common Stock, Shares Conversion of Series D Convertible Preferred Stock to Common Stock Conversion of Series D Convertible Preferred Stock to Common Stock, Shares Conversion of Short-term convertible notes payable - related party Conversion of Short-term convertible notes payable - related party, Shares Conversion of April Advance notes - related parties Conversion of April Advance notes - related parties, Shares Conversion of Short-term convertible notes to Preferred Stock Conversion of Short-term convertible notes to Preferred Stock, Shares Issuance of warrants pursuant to conversion of Short-term convertible notes Issuance of common stock in connection with extinguishment of short-term notes, related party Issuance of common stock in connection with extinguishment of short-term notes, related party, Shares Deemed dividend on Series D Convertible Preferred Stock at issuance Reclassification of related party warrants to equity Issuance of warrants pursuant to extension of convertible short-term notes, related party Issuance of Series A Preferred Stock in Rights Offering, net of issuance costs Issuance of Series A Preferred Stock in Rights Offering, net of issuance costs, Shares Conversion of Series A Preferred Stock to Common Stock Conversion of Series A Preferred Stock to Common Stock, Shares Conversion of warrants to Common Stock Conversion of warrants to Common Stock, Shares Adjustment for assets and liabilities not included in Merger 5,258,300 5,258,300 Issuance of common stock in connection with private placement offering 17,700,000 17,700 4,402,087 4,419,787 Issuance of warrants in connection with private placement offering 2,663,797 2,663,797 Finance costs on issuance of Series B Convertible Preferred Stock and related warrants (132,513) (132,513) Issuance of common stock pursuant to conversion of short-term debt 500,000 500 125,437 125,937 Issuance of warrants pursuant to conversion of short-term debt 74,063 74,063 Issuance of additional exchange shares 17,263,889 17,264 (17,264) Issuance of common stock pursuant to conversion of convertible short-term debt 250,000 250 99,750 100,000 Issuance of common stock pursuant to warrant exchange 403,125 403 72,160 72,563 Conversion of Series B Convertible Preferred Stock (2,650) (2) 715,279 716 (714) Repurchase of Series B Convertible Preferred Stock (500) (1) (49,999) (50,000) Issuance of common stock to pay accrued dividends on Series B Convertible Preferred Stock 50,367 50 19,376 19,426 Issuance of common stock to pay accrued interest on convertible short-term debt 1,667 2 665 667 Issuance of common stock in exchange for consulting fees incurred 280,085 280 95,253 95,533 Deemed dividend on adjustment to exercise price on convertible debt and certain warrants 287,542 (287,542) Deemed dividend on beneficial conversion features 32,592 (32,592) Issuance of common stock per restricted stock award to executive 4,225,634 4,226 1,686,028 1,690,254 Issuance of warrants pursuant to short-term notes, related party 56,378 56,378 Issuance of warrants pursuant to extension of maturity date on convertible debt 106,158 106,158 Deemed dividend on Series D Convertible Preferred Stock (60,493) (3,130,146) (3,190,639) Beneficial conversion of Series D Convertible Preferred Stock 623,045 623,045 Finance costs on issuance of Series D Convertible Preferred Stock and related warrants (37,618) (66,265) (103,883) Issuance of warrants pursuant to private placement of Series D Convertible Preferred Stock 1,893,006 1,893,006 Stock based compensation 94,828 94,828 Accrued dividends on Series B Convertible Preferred Stock (84,939) (84,939) Net loss (29,807,878) (29,807,878) Balances December 31, 2019 $- 6,100 $6 99,768,704 $99,769 $28,172,146 $(37,362,531) $(370,132) $(9,460,742) Preferred Series A Stock Preferred Series B Stock Common Stock Additional Paid-in Accumulated Non-Controlling Total Stockholders Shares Amount Shares Amount Shares Amount Capital Deficit Interest Deficit Balances - December 31, 2019 $- 6,100 $6 99,768,704 $99,769 $28,172,146 $(37,362,531) $(370,132) $ (9,460,742) Beginning balance $- 6,100 $6 99,768,704 $99,769 $28,172,146 $(37,362,531) $(370,132) $ (9,460,742) Accrued dividends on Series B Convertible Preferred Stock (44,456) (44,456) Adjustment of exercise price on certain warrants (438,913) (438,913) Reclassification of Series B warrants to equity 73,805 73,805 Reclassification of Series D warrants to equity 337,400 337,400 Conversion of Series B Convertible Preferred Stock to Common Stock (6,100) (6) 2,119,713 2,120 150,983 153,097 Conversion of Series D Convertible Preferred Stock to Common Stock 15,773,363 15,773 6,422,441 6,438,214 Conversion of Short-term convertible notes payable - related party 35,860,079 35,860 412,541 448,401 Conversion of April Advance notes - related parties 198,194,248 198,194 2,579,961 2,778,155 Conversion of Short-term convertible notes to Preferred Stock 89,790,089 89,790 1,167,271 1,257,061 Issuance of warrants pursuant to conversion of Short-term convertible notes 1,004,252 1,004,252 Issuance of common stock in connection with extinguishment of short-term notes, related party 4,368,278 4,368 214,046 218,414 Deemed dividend on Series D Convertible Preferred Stock (277,719) (277,719) Deemed dividend on Series D Convertible Preferred Stock at issuance (37,207) (37,207) Reclassification of related party warrants to equity 107,123 107,123 Issuance of Common Stock in exchange for consulting fees incurred 109,375 109 34,891 35,000 Issuance of warrants pursuant to private placement of Series D Convertible Preferred Stock 31,902 31,902 Issuance of warrants pursuant to extension of convertible short-term notes, related party 17,636 17,636 Issuance of warrants pursuant to extension of maturity date on convertible debt 6,595 6,595 Issuance of Series A Preferred Stock in Rights Offering, net of issuance costs 218,285,024 218,285 2,517,451 2,735,736 Stock based compensation 643 643 Conversion of Series A Preferred Stock to Common Stock (4,020,031) (4,020) 4,020,031 4,020 Conversion of warrants to Common Stock 1,000,000 1,000 26,000 27,000 Net loss (6,459,236) (6,459,236) Balances - December 31, 2020 538,109,409 $538,109 $- 127,159,464 $127,159 $42,515,999 $(43,858,974) $(370,132) $(1,047,839) Ending balance 538,109,409 $538,109 $- 127,159,464 $127,159 $42,515,999 $(43,858,974) $(370,132) $(1,047,839) The accompanying notes are an integral part of these financial statements. F-23 H-Cyte, Inc Consolidated Statements of Cash Flows 2020 2019 December 31, 2020 2019 Cash Flows from Operating Activities Net loss $(6,459,236) $(29,807,878) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization 81,470 834,291 Loss on impairment 15,508,401 Loss on asset disposal 1,342 Amortization of debt discount 1,395,007 152,342 Interest and penalties on extension of short-term convertible notes 85,365 Stock-based compensation 643 1,785,082 Loss on write-off of inventory 131,455 Common stock issued for consulting services 35,000 95,533 Income from change in fair value adjustment of derivative liability - warrants (2,986,854) (827,260) Change in fair value of redemption put liability (272,704) (346,696) Change in fair value of Derivative Liability - Day one derivative loss 2,306,121 Issuance of warrants to extend short-term debt, related party 17,636 Bad debt expense 6,000 90,137 Issuance of warrants pursuant to extension of maturity date on convertible debt 6,595 106,158 Issuance of Common Stock pursuant to warrant exchange 27,000 Gain on extinguishment of short-term notes, related party (1,300,088) Warrant modification expense 70,851 Changes in operating assets and liabilities, net of purchase transaction: Accounts receivable 16,667 48,195 Other receivables (3,450) (13,529) Prepaid expenses and other assets 723,578 (697,529) Interest payable 36,196 (10,592) Accounts payable (478,572) 121,907 Accrued liabilities (48,569) (263,874) Other current liabilities (20,369) (2,875) Deferred revenue (412,007) 720,092 Net Cash Used in Operating Activities (7,257,743) (12,291,275) Cash Flows from Investing Activities Purchase of property and equipment (2,284) (20,686) Purchase of business, net of cash acquired (302,710) Net assets not included in purchase transaction (69,629) Net Cash Used in Investing Activities (2,284) (393,025) Cash Flows from Financing Activities Proceeds from short-term related party notes 1,635,000 Payment of dividends (14,684) Proceeds from Paycheck Protection Plan 809,082 Payment on debt obligations (10,937) (370,636) Proceeds from common stock, net of issuance costs 4,337,106 Proceeds from Secured Convertible Promissory Notes 3,842,695 2,613,965 Proceeds from issuance of Series D Convertible Preferred Stock, net of issuance costs 100,000 5,888,017 Proceeds from Preferred stock Series A, net of issuance costs 2,735,736 Payment on Preferred stock Series B Convertible Preferred Stock redemption (50,000) Net Cash Provided by Financing Activities 7,476,576 14,038,768 Net Increase in Cash 216,549 1,354,468 Cash - Beginning of period 1,424,096 69,628 Cash - End of period $1,640,645 $1,424,096 Supplementary Cash Flow Information Cash paid for interest $33,136 $197,500 Non-cash investing and financing activities Common stock issued to pay accrued dividends 19,426 Deemed dividend on adjustment to exercise price on convertible debt and certain warrants 287,542 Deemed dividend on beneficial conversion feature 32,592 Deemed dividend on Series D Convertible Preferred Stock 314,926 3,190,639 Conversion of debt obligations to Common Stock 225,937 Conversion of Series D Convertible Preferred Stock and accrued dividends to Common Stock 6,438,214 623,045 Reclassification of related party warrants to equity 107,123 Reclassification of Series B warrants to equity 73,805 Reclassification of Series D warrants to equity 337,400 Conversion of debt obligations to warrants 74,063 Issuance of warrants pursuant to note payable, related party 56,378 Conversion of Series B Convertible Preferred Stock and accrued dividends to Common Stock 153,097 Conversion of Short-term convertible notes payable, related party 448,401 Conversion of April Advance notes-related parties 2,778,155 Conversion of Short-term convertible notes to Preferred Stock 1,257,061 Issuance of warrants pursuant to conversion of short-term convertible notes 1,004,252 Dividends accrued on Series B Convertible Preferred Stock 44,456 65,512 Adjustment of exercise price on certain warrants 438,913 Issuance of Common Stock in connection with extinguishment of short-term notes, related party 218,414 Issuance of warrants pursuant to private placement of Series D Convertible Preferred Stock 31,902 1,893,006 Right-of-use asset additions 1,165,785 Right-of-use liability 1,187,991 The accompanying notes are an integral part of these financial statements. F-24 H-Cyte, Inc Notes to Consolidated Financial Statements Note 1 Description of the Company H-CYTE, Inc is a hybrid-biopharmaceutical company dedicated to developing and delivering new treatments for patients with chronic respiratory and pulmonary disorders. During the last 18 months, the Company has evolved into two separate verticals under its Healthcare Medical Biosciences Division with its entrance into the biologics development space ( Biologics Vertical ). This new vertical is complementary to the Company s current Lung Health Institute (LHI) autologous infusion therapy business ( Infusion Vertical ) and is focused on underserved disease states. On July 11, 2019, MedoveX Corp. ( MedoveX ) changed its name to H-CYTE, Inc. ( H-CYTE or the Company ) by filing a Certificate of Amendment (the Amendment ) to the Company s Amended and Restated Certificate of Incorporation (the Certificate of Incorporation ) with the Secretary of the State of Nevada. The name change and the Company s new symbol, HCYT, became effective with FINRA on July 15, 2019. H-CYTE was incorporated in Nevada on July 30, 2013 as SpineZ Corp. On October 18, 2018, H-CYTE (formerly named MedoveX) entered into an Asset Purchase Agreement ( APA ) with Regenerative Medicine Solutions, LLC, RMS Shareholder, LLC ( Shareholder ), Lung Institute LLC ( LI ), RMS Lung Institute Management LLC ( RMS LI Management ) and Cognitive Health Institute Tampa, LLC ( CHIT ), (collectively RMS ). On January 8, 2019, the APA was amended, and the Company acquired certain assets and assumed certain liabilities of RMS as reported in the 8-K/A filed in March of 2019. Based on the terms of the APA and its amendment (collectively the APA ), the former RMS members had voting control of the combined company as of the closing of the RMS acquisition. For accounting purposes, the acquisition transaction has been treated as a reverse acquisition whereby the Company is deemed to have been acquired by RMS and the historical financial statements prior to the acquisition date of January 8, 2019 now reflect the historical financial statements of RMS. As of the merger, the consolidated results for H-CYTE include the following wholly-owned subsidiaries: H-CYTE Management, LLC (formerly Blue Zone Health Management, LLC), MedoveX Corp, Cognitive Health Institute, LLC, and Lung Institute Tampa, LLC (formerly Blue Zone Lung Tampa, LLC) and the results included Lung Institute Dallas, PLLC ( LI Dallas ), Lung Institute Nashville, PLLC ( LI Nashville ), Lung Institute Pittsburgh, PLLC ( LI Pittsburgh ), and Lung Institute Scottsdale, LLC ( LI Scottsdale ), as Variable Interest Entities ( VIEs ). H-CYTE Management, LLC is the operator and manager of the various Lung Health Institute (LHI) clinics: LI Dallas, LI Nashville, LI Pittsburgh, and LI Scottsdale. On September 11, 2020, with the closing of the Rights Offering, FWHC, LLC, FWHC, Bridge, LLC, and FWHC Bridge Friends, LLC (collectively known as FWHC ) gained control of the Company by subsequently owning approximately 61% of the fully diluted shares of the Company (see Notes 8 and 9). Company s Two Operating Divisions The Company has two divisions: the Healthcare Medical Biosciences Division ( which includes the Infusion Vertical and the Biologics Vertical ) and the DenerveX medical device division ( DenerveX ). The Company has decided to focus its available resources on the Medical Biosciences Division as it represents a significantly greater opportunity than the DenerveX division. The Company is no longer manufacturing or selling the DenerveX device but continues to explore possible opportunities to monetize such technology. Healthcare Medical Biosciences Division (Biosciences Division) Autologous Infusion Therapy ( Infusion Vertical ) The Company s Biosciences includes the Infusion Business that develops and implements innovative treatment options in autologous cellular therapy (PRP-PBMC) to treat chronic lung disorders. Committed to an individualized patient-centric approach, this division consistently provides oversight and management of the highest quality care to the LHI clinics located in Tampa, Nashville, and Scottsdale, while producing positive medical outcomes following the strictest CDC guidelines. Biotech Development Division ( Biologics Vertical ) On June 21, 2019, H-CYTE entered into an exclusive product supply agreement with Rion, LLC ( Rion ) to develop and distribute (post FDA approval) a biologic for chronic obstructive pulmonary disease ( COPD ), the fourth leading cause of death in the U.S. Rion has established a novel biologics technology to harness the healing power of the body. Rion s innovative technology, based on science developed at Mayo Clinic, provides an off-the-shelf platform to enhance healing in soft tissue, musculoskeletal, cardiovascular and neurological organ systems. This agreement provides for a 10-year exclusive and extendable supply agreement with Rion to enable H-CYTE to develop proprietary biologics. On October 9, 2019, the Company entered into a services agreement with Rion which provides the Company the benefit of Rion s resources and expertise for the limited purpose of (i) consulting with and assisting H-CYTE in the further research and development for the generation of a new biologic and (ii) subsequently assisting H-CYTE in seeking and obtaining FDA Phase 1 IND clearance for this biologic as necessary. Rion also agrees to consult with H-CYTE in its arrangement for services from third parties unaffiliated with Rion to support research, development, regulatory approval, and commercialization of the biologic. With these agreements, Rion will serve as the product supplier and contracted preclinical development arm of the biologic. H-CYTE will control the commercial development and the clinical trial investigation. After conducting the clinical efficacy trials of this biologic, H-CYTE intends to pursue submission of a Biologics License Application ( BLA ) for review by the FDA for treatment of COPD. F-25 Proprietary Medical Device Business (DenerveX division) In the first quarter of 2020, the Company made the decision to stop any further efforts to source alternative manufacturing and distributor options or other product relationships for the DenerveX product. Although the Company believes the DenerveX technology has value, the Company did not believe it would realize value in the foreseeable future. The Company recorded an impairment charge for intangibles associated with the DenerveX intellectual property and wrote off related inventory balances as of December 31, 2019. The Company is no longer manufacturing or selling the DenerveX device but continues to explore possible opportunities to monetize such technology. Note 2 Basis Of Presentation and Summary of Significant Accounting Policies Basis of presentation Based on the terms of the APA, the former RMS members had voting control of the combined company as of the closing of the Merger. RMS is deemed to be the acquiring company for accounting purposes and the transaction is accounted for as a reverse acquisition under the acquisition method of accounting for business combinations in accordance with U.S. GAAP. The assets acquired and the liabilities assumed of RMS included as part of the purchase transaction are recorded at historical cost. Accordingly, the assets and liabilities of H-CYTE are recorded as of the Merger closing date at their estimated fair values. The consolidated balance sheets, consolidated statements of operations, consolidated statements of stockholders deficit, and the consolidated statements of cash flows do not reflect the historical financial information related to H-CYTE prior to the Merger as they only reflect the historical financial information related to RMS. For the consolidated statements of stockholders deficit, the common stock, preferred stock, and additional paid in capital reflect the accounting for the stock received by the RMS members as of the Merger as if it was received at the beginning of the periods presented. Principles of Consolidation U.S. GAAP requires that a related entity be consolidated with a company when certain conditions exist. An entity is considered to be a VIE when it has equity investors who lack the characteristics of having a controlling financial interest, or its capital is insufficient to permit it to finance its activities without additional subordinated financial support. Consolidation of a VIE by the Parent would be required if it is determined that the Parent will absorb a majority of the VIE s expected losses or residual returns if they occur, retain the power to direct or control the VIE s activities, or both. The accompanying audited consolidated financial statements include the accounts of the Parent, its wholly owned subsidiaries, and its VIEs. All intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates In preparing the financial statements, U.S. GAAP requires disclosure regarding estimates and assumptions used by management that affect the amounts reported in financial statements and accompanying notes. Significant estimates were made around the valuation of embedded derivatives, which impacts gains or losses on such derivatives, the carrying value of debt, interest expense, and deemed dividends. Actual results could differ from those estimates. F-26 Cash The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. The Company s cash balances at December 31, 2020 and 2019 consists of funds deposited in checking accounts with commercial banks. Accounts Receivable Accounts receivable represent amounts due from customers for which revenue has been recognized. Generally, the Company does not require collateral or any other security to support its receivables. Trade accounts receivable are stated net of an estimate made for doubtful accounts, if any. Management evaluates the adequacy of the allowance for doubtful accounts regularly to determine if any account balances will potentially be uncollectible. Customer account balances are considered past due or delinquent based on the contractual agreement with each customer. Accounts are written off when, in management s judgment, they are considered uncollectible. At December 31, 2020 and 2019, management believes no allowance is necessary. For the year ended December 31, 2020 and 2019, the Company recorded bad debt expense of approximately $6,000 and $90,000, respectively. Impairment of Long-Lived Assets The Company reviews the values assigned to long-lived assets, including property and equipment and certain intangible assets, to determine whether events and circumstances have occurred which indicate that the remaining estimated useful lives may warrant revision or that the remaining balances may not be recoverable. The evaluation of asset impairment requires management to make assumptions about future cash flows over the life of the asset being evaluated. These assumptions require significant judgment, and actual results may differ from estimated amounts. In such reviews, undiscounted cash flows associated with these assets are compared with their carrying value to determine if a write-down to fair value is required (see Note 7). Goodwill Goodwill represents the excess of purchase price over fair value of net identified tangible and intangible assets and liabilities acquired. The Company does not amortize goodwill; it tests goodwill for impairment on at least an annual basis. An impairment loss, if any, is measured as the excess of the carrying value of the reporting unit over the fair value of the reporting unit (see Note 7). Leases In February 2016, the Financial Accounting Standard Board ( FASB ) established Topic 842, Leases, by issuing Accounting Standards Update (ASU) No. 2016-02 (as amended), which requires lessees to recognize leases on the balance sheet and disclose key information about leasing arrangements. The new standard establishes a right-of-use ( ROU ) model that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than twelve months. Leases will be classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the statement of operations. The Company has not entered into significant lease agreements in which it is the lessor. For the lease agreements in which the Company is the lessee, under Topic 842, lessees are required to recognize a lease liability and right-of-use asset for all leases (except for short-term leases) at the lease commencement date. Effective January 1, 2019, the Company adopted this guidance, applied the modified retrospective transition method and elected the transition option to use the effective date as the date of initial application. The Company recognized the cumulative effect of the transition adjustment on the consolidated balance sheet as of the effective date and did not provide any new lease disclosures for periods before the effective date. With respect to the practical expedients, the Company elected the package of transitional-related practical expedients and the practical expedient not to separate lease and non-lease components. F-27 Other Receivables Other receivables totaling approximately $22,000 and $19,000 at December 31, 2020 and 2019, respectively include receivables from the non-acquired Lung Institute, LLC due to Lung Institute Tampa, LLC for approximately $3,000 and $10,000. Other receivables totaling approximately $19,000 and $9,000 include reimbursement receivables for expenses from RMS at December 31, 2020 and 2019, respectively. Revenue Recognition The Company recognizes revenue in accordance with U.S. GAAP as outlined in the FASB ASC 606, Revenue From Contracts with Customers, which requires that five steps be completed to determine when revenue can be recognized: (i) identify the contract with the customer; (ii) identity the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price; and (v) recognize revenue when or as the entity satisfies a performance obligation. The Company records revenue under ASC 606 as services are performed for the customer. The Company uses a standard pricing model for the types of cellular therapy treatments that is offered to its patients. The transaction price accounts for medical, surgical, facility, and office services rendered by the Company for consented procedures and is recorded as revenue. The Company recognizes revenue when the terms of a contract with a patient are satisfied. The Company offers two types of cellular therapy treatments to their patients. 1) The first type of treatment includes medical services rendered typically over a two-day period in which the patient receives cellular therapy. For this treatment type, revenue is recognized in full at time of service. 2) The Company also offers a four-day treatment in which medical services are rendered typically over a two-day period and then again, approximately three months later, medical services are rendered for an additional two days of treatment. Payment is collected in full for both service periods at the time the first treatment is rendered. Revenue is recognized when services are performed based on the estimated standalone selling price of each service. The Company has deferred recognition of revenue amounting to approximately $634,000 and $1,046,000 at December 31, 2020 and 2019, respectively. The Company s policy is to not offer refunds to patients. However, in limited instances the Company may make exceptions to this policy for extenuating circumstances. These instances are evaluated on a case-by-case basis and may result in a patient refund. Management performed an analysis of its customer refund history for refunds issued related to prior year s revenue. Management used the results of this historical refund analysis to record a reserve for anticipated future refunds related to recognized revenue. At December 31, 2020 and 2019, the estimated allowance for refunds was approximately $77,000 and $63,000, respectively and is recorded in a contra revenue account. Research and development costs Research and development expenses are recorded in operating expenses in the period in which they are incurred. Advertising Advertising costs are recorded in operating expenses in the period in which they are incurred. Stock-Based Compensation The Company maintains a stock option incentive plan and accounts for stock-based compensation in accordance with ASC 718, Compensation - Stock Compensation. The Company recognizes share-based compensation expense, net of an estimated forfeiture rate, over the requisite service period of the award to employees and directors. As required by fair value provisions of share-based compensation, employee and non-employee share-based compensation expense recognized is calculated over the requisite service period of the awards and reduced for estimated forfeitures. F-28 Income Taxes The Company utilizes the liability method of accounting for income taxes as set forth in FASB ASC Topic 740, Income Taxes . Under the liability method, deferred taxes are determined based on temporary differences between the financial statement and tax bases of assets and liabilities using tax rates expected to be in effect during the years in which the difference turns around. The Company accounts for interest and penalties on income taxes as income tax expense. A valuation allowance is recorded when it is more likely than not that a tax benefit will not be realized. In determining the need for valuation allowances the Company considers projected future taxable income and the availability of tax planning strategies. From inception to December 31, 2020, the Company has incurred net losses and, therefore, has no current income tax liability. The net deferred tax asset generated by these losses is fully offset by a valuation allowance as of December 31, 2020 and 2019 since it is currently likely that the benefit will not be realized in future periods. There are no uncertain tax positions at December 31, 2020 and 2019. The Company has not undergone any tax examinations since inception. Net Loss Per Share Basic loss per share is computed on the basis of the weighted average number of shares outstanding for the reporting period. Diluted loss per share is computed on the basis of the weighted average number of common shares plus potentially dilutive common shares outstanding using the treasury stock method. Any potentially dilutive securities are antidilutive due to the Company s net losses. Fair Value Measurements The Company measures certain non-financial assets, liabilities, and equity issuances at fair value on a non-recurring basis. These non-recurring valuations include evaluating assets such as long-lived assets and non-amortizing intangible assets for impairment; allocating value to assets in an acquired asset group; and applying accounting for business combinations. The Company classifies its stock warrants as either liability or equity instruments in accordance with ASC 480, Distinguishing Liabilities from Equity (ASC 480) and ASC 815, Derivatives and Hedging (ASC 815), depending on the specific terms of the warrant agreement. The Company uses the fair value measurement framework to value these assets and report the fair values in the periods in which they are recorded, adjusted above, or written down. The fair value measurement framework includes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair values in their broad levels. These levels from highest to lowest priority are as follows: Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities; Level 2: Quoted prices in active markets for similar assets or liabilities or observable prices that are based on inputs not quoted on active markets, but corroborated by market data; and Level 3: Unobservable inputs or valuation techniques that are used when little or no market data is available. F-29 The determination of fair value and the assessment of a measurement s placement within the hierarchy requires judgment. Level 3 valuations often involve a higher degree of judgment and complexity. Level 3 valuations may require the use of various cost, market, or income valuation methodologies applied to unobservable management estimates and assumptions. Management s assumptions could vary depending on the asset or liability valued and the valuation method used. Such assumptions could include estimates of prices, earnings, costs, actions of market participants, market factors, or the weighting of various valuation methods. The Company may also engage external advisors to assist us in determining fair value, as appropriate. The Company evaluates its financial liabilities subject to fair value measurements on a recurring basis to determine the appropriate level in which to classify them for each reporting period. This determination requires significant judgments to be made. Although the Company believes that the recorded fair value of our financial instruments is appropriate at December 31, 2020, these fair values may not be indicative of net realizable value or reflective of future fair values. Note 3 - Liquidity, Going Concern and Management s Plans The Company incurred net losses of approximately $6,459,000 for the year ending December 31, 2020. The Company used approximately $7,258,000 in net cash from operating activities for the year ending December 31, 2020 and has historically incurred losses from operations and expects to continue to generate negative cash flows as the Company implements its business plan. The consolidated financial statements are prepared using generally accepted accounting principles in the United States ( U.S. GAAP ) as applicable to a going concern. COVID-19 has adversely affected the Company s financial condition and results of operations. The impact of the outbreak of COVID-19 on the economy in the U.S. and the rest of the world is expected to continue to be significant. The extent to which the COVID-19 outbreak will continue to impact the economy is highly uncertain and cannot be predicted. Accordingly, the Company cannot predict the extent to which its financial condition and results of operations will be affected. The Company has updated its business model to decrease corporate overhead and marketing expense to significantly reduce expenses. The Company believes that as COVID-19 begins to dissipate due to vaccinations being administered nationwide, patients will again feel comfortable traveling to one of the LHI clinics for treatment. The Company s Biologics Vertical has commenced preclinical work in support of filing an Investigational New Drug Application ( IND ) with the U.S. Food and Drug Administration ( FDA ). The Company is anticipating an initial submission during the second half of 2021. The Company had cash on hand of approximately $1,641,000 as of December 31, 2020 and approximately $436,000, as of March 24, 2021. The Company s cash is insufficient to fund its operations over the next year and the Company is currently working to obtain additional debt or equity financing to help support short-term working capital needs. F-30 There can be no assurance that the Company will be able to raise additional funds or that the terms and conditions of any future financings will be workable or acceptable to the Company or its shareholders. If the Company is unable to fund its operations from existing cash on hand, operating cash flows, additional borrowings, or raising equity capital, the Company may be forced to discontinue operations. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. Note 4 Business Acquisition On January 8, 2019, MedoveX completed its business combination with RMS under which MedoveX purchased certain assets and assumed certain liabilities of RMS, otherwise referred to as the Merger. Pursuant to the terms of the APA, MedoveX issued to the shareholders of RMS 33,661 shares plus 6,111 additional Exchange Shares (based on closing the sale of $2 million of new securities) for a total of 39,772 shares of Series C Preferred Stock where each share of Series C Preferred stock automatically converted into 1,000 shares of common stock and represent approximately 55% of the outstanding voting shares of the Company. Under the terms of the APA, the Company issued additional Exchange Shares to the shareholders of RMS to maintain the 55% ownership and not be diluted by the sale of convertible securities ( New Shares Sold ) until MedoveX raised an additional $5.65 million via the issuance of new securities. On the date of closing the Company issued 6,111 additional Exchange Shares to RMS Shareholders as a result of the issuance of additional securities, which are included in the 39,772 shares above. Subsequent to the closing of the purchase transaction, an incremental 11,153 additional Exchange Shares were issued, for a total of 17,264 additional Exchange Shares. All additional Exchange Shares have been issued to the shareholders of RMS and these Series C Preferred shares converted to 17,263,889 shares of common stock; no additional equity will be issued to RMS. Because RMS shareholders owned approximately 55% of the voting stock of MedoveX after the transaction, RMS was deemed to be the acquiring company for accounting purposes (the Acquirer ) and the transaction is accounted for as a reverse acquisition under the acquisition method of accounting for business combinations in accordance with U.S. GAAP. The assets acquired and the liabilities assumed of RMS included as part of the purchase transaction are recorded at historical cost. Accordingly, the assets and liabilities of MedoveX (the Acquiree ) are recorded as of the Merger closing date at their estimated fair values. Under the terms of the APA, MedoveX purchased certain assets and assumed certain liabilities of RMS. The assets of RMS reported on the MedoveX consolidated balance sheet as of December 31, 2018 that were excluded in the Merger on January 8, 2019 included the following: cash of approximately $70,000 convertible debt to a related party of approximately $4,300,000, interest payable of approximately $158,000, short-term notes, related party of approximately $180,000, accounts payable of approximately $398,000 and other current liabilities of approximately $285,000. Additionally, there were certain on-going litigation matters that were not assumed as part of the January 8, 2019 Merger. Purchase Price Allocation The purchase price for the acquisition of the Acquiree has been allocated to the assets acquired and liabilities assumed based on their estimated fair values. The acquisition-date fair value of the consideration transferred is as follows: Schedule of Fair Value of Consideration Transferred 1 Common shares issued and outstanding 24,717,270 Common shares reserved for issuance upon conversion of the outstanding Series B Preferred Stock 2,312,500 Total Common shares 27,029,770 Closing price per share of MedoveX Common stock on January 8, 2019 $0.40 10,811,908 Fair value of outstanding warrants and options 2,220,000 Cash consideration to RMS (350,000) Total consideration $12,681,908 F-31 Prior to the transaction, MedoveX had 24.5 million shares of common stock outstanding at a market capitalization of $9.8 million. The estimated fair value of the net assets of MedoveX was $8.4 million as of January 8, 2019. Measuring the fair value of the net assets to be received by RMS was readily determinable based upon the underlying nature of the net assets. The fair value of the MedoveX common stock is above the fair value of its net assets. The MedoveX net asset value is primarily comprised of definite-lived intangibles as of the closing and the RMS interest in the merger is significantly related to obtaining access to the public market. Therefore, the fair value of the MedoveX stock price and market capitalization as of the closing date is considered to be the best indicator of the fair value and, therefore, the estimated purchase price consideration. The following table summarizes the fair values of the assets acquired and liabilities assumed at the date of acquisition on January 8, 2019: Schedule of Estimated Fair Values of Assets Acquired and Liabilities Assumed 1 Cash $(302,710) Accounts receivable 145,757 Inventory 131,455 Prepaid expenses 46,153 Property and equipment 30,393 Other 2,751 Intangibles 3,680,000 Goodwill 12,564,401 Total assets acquired $16,298,200 Accounts payable and other accrued liabilities 1,645,399 Derivative liability 1,215,677 Interest-bearing liabilities and other 755,216 Net assets acquired $12,681,908 Intangible assets are recorded as definite-lived assets and amortized over the estimated period of economic benefit. Intangible assets represent the fair value of patents and related proprietary technology for the DenerveX System. During the fourth quarter of 2019 the Company recorded an impairment charge of $2,944,000 related to the carrying value of its intangible assets (see Note 7). Goodwill is calculated as the difference between the acquisition-date fair value of the consideration transferred and the fair values of the assets acquired and liabilities assumed. Goodwill is not expected to be deductible for income tax purposes. Goodwill is recorded as an indefinite-lived asset and is not amortized but tested for impairment on an annual basis or when indications of impairment exist. During the fourth quarter of 2019 the Company recorded an impairment charge of approximately $12,564,000 related to the carrying value of goodwill (see Note 7). The derivative liability relates to the liability associated with warrants issued with the securities purchase agreements executed in May 2018, which liability was assumed in the Merger (see Note 12). Total interest-bearing liabilities and other liabilities assumed are as follows: Schedule of Interest Bearing and Other Liabilities Assumed 1 Notes payable $99,017 Short-term convertible notes payable 598,119 Dividend payable 57,813 Deferred rent 267 Total interest-bearing and other liabilities $755,216 Notes payable relate to promissory notes assumed by Acquiree in a 2015 acquisition, which was later divested in 2016, with the assumed promissory notes being retained by Acquiree. The Company finalized an eighteen-month extension on the notes extending the maturity date to March 1, 2021. Payments on both notes are due in aggregate monthly installments of approximately $5,800 and carry an interest rate of 5%. The promissory notes had outstanding balances of approximately $99,000 plus accrued interest of approximately $3,000 at January 8, 2019 (see Note 11) and promissory notes had outstanding balances of approximately $67,000 and $78,000 at December 31, 2020 and 2019. The Company has not made payments on this note since February 10, 2020, due to COVID-19, resulting in accrued interest of approximately $1,900. F-32 In the third quarter of 2018, convertible notes were issued pursuant to a securities purchase agreement with select accredited investors, whereby the Acquiree offered up to 1,000,000 units (the Units ) at a purchase price of $50,000 per Unit. Each Unit consisted of (i) a 12% senior secured convertible note, initially convertible into shares of the Company s common stock, par value $0.001 per share, at a conversion price equal to the lesser of $0.40 or ninety percent (90%) of the per share purchase price of any shares of common stock or common stock equivalents issued in future private placements of equity and/or debt securities completed by the Company following this offering of Units, and (ii) a three-year warrant to purchase such number of shares of the Company s common stock equal to one hundred percent (100%) of the number of shares of common stock issuable upon conversion of the notes at $0.40. The warrants are exercisable at a price equal to the lesser of $0.75 or ninety percent (90%) of the per share purchase price of any shares of common stock or common stock equivalents issued in future private placements of the debt and/or equity securities completed by the Company following the issuance of warrants. As a result of the price adjustment feature, the conversion price of the convertible notes was adjusted to $0.36 per share. In
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001610315_oxeia_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001610315_oxeia_prospectus_summary.txt
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1 RISK FACTORS 9 INFORMATION REGARDING FORWARD-LOOKING STATEMENTS 37 INDUSTRY AND MARKET DATA 38 USE OF PROCEEDS 39 DIVIDEND POLICY 39 CAPITALIZATION 39 DILUTION 41 MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND PLAN OF OPERATIONS 43 BUSINESS 52 MANAGEMENT 68 EXECUTIVE AND DIRECTOR COMPENSATION 72 CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS 74 PRINCIPAL STOCKHOLDERS 75 DESCRIPTION OF CAPITAL STOCK 76 SHARES ELIGIBLE FOR FUTURE SALE 79 MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES TO NON-U.S. HOLDERS OF OUR COMMON STOCK 80 UNDERWRITING 84 LEGAL MATTERS 89 EXPERTS 89 WHERE YOU CAN FIND MORE INFORMATION 89 INDEX TO FINANCIAL STATEMENTS F-1 We have not, and the underwriters have not, authorized anyone to provide any information or to make any representations other than those contained in this prospectus or in any free writing prospectus prepared by or on behalf of us or to which we have referred you. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give to you. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or any sale of our common stock. You should rely only on the information contained in this prospectus. No dealer, salesperson or other person is authorized to give information that is not contained in this prospectus. This prospectus is not an offer to sell nor is it seeking an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. The information in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of these securities. All trademarks, trade names and service marks appearing in this prospectus are the property of their respective owners. Solely for convenience, the trademarks and trade names in this prospectus are referred to without the and TM symbols, but such references should not be construed as any indicator that their respective owners will not assert, to the fullest extent under applicable law, their rights thereto. i PROSPECTUS SUMMARY The following summary highlights selected information contained elsewhere in this prospectus and is qualified in its entirety by the more detailed information and financial statements included elsewhere in this prospectus. It does not contain all the information that may be important to you and your investment decision. You should carefully read this entire prospectus, including the matters set forth under
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001615647_hemoglobin_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001615647_hemoglobin_prospectus_summary.txt
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@@ -0,0 +1,366 @@
+prospectus summary. Primarily, our
+manufacturing facility is under construction to accommodate the additional process steps resulting from consolidation of the two other
+facilities. In order to do so, we must refit our newly constructed facility in Souderton, Pennsylvania with the equipment necessary for
+manufacturing and packaging, which has been relocated from facilities in Cambridge, Massachusetts and Ontario, Canada. Our ability to
+initially start manufacturing our products and generating revenues is substantially dependent upon the successful completion of the construction
+and re-fitting of our Souderton facility. Until it is complete, and the relevant cGMP certification is received, we will not be able
+release and commercially distribute any product. The proceeds of the Offering will be insufficient to fully complete the relaunch of
+our products into the market. We will require approximately $15 million of additional monies to complete this process. If we do not successfully
+raise such monies through public or private equity or debt financings or other sources, such as strategic collaborations or license and
+development agreements, the facility cannot be completed and we will be unable to produce and commercially distribute any product.
+
+ 
+
+In
+addition to the risks associated with our facility, some of the risks involved with the offering include the following:
+
+ 
+
+ 
+ 
+ 
+ We
+ have incurred substantial losses since our inception and anticipate that we will continue to incur substantial and increasing losses
+ for the foreseeable future.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ will require substantial additional financing to achieve our goals, and a failure to obtain this necessary capital when needed could
+ force us to delay, limit, reduce or terminate our product development or commercialization efforts.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ currently have very limited revenues. We may never generate significant revenues or achieve profitability.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ expect to continue to incur significant operating and non-operating expenses, which may make it difficult for us to secure sufficient
+ financing. Our recurring losses from operations raise substantial doubt about our ability to continue as a going concern. As a result,
+ our independent registered public accounting firm included an explanatory paragraph in its report on our financial statements for
+ the year ended December 31, 2021 with respect to this uncertainty.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ It
+ is possible that we may face substantial competition caused by others discovering, developing or commercializing products before
+ or more successfully than we do.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ If
+ we are unable to successfully develop and commercialize our product candidates or experience significant delays in doing so, our
+ business may be materially harmed.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ success relies on third-party suppliers and manufacturers. Any failure by such third parties, including, but not limited to, failure
+ to successfully perform and comply with regulatory requirements, could negatively impact our business and our ability to develop
+ and market our product candidate, and our business could be substantially harmed.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ future success is dependent on the regulatory approval of our product candidates.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ business may be adversely affected by the ongoing coronavirus pandemic.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Business
+ interruptions could adversely affect future operations, revenues, and financial condition, and may increase our cost of doing business.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ may infringe the intellectual property rights of others, which may prevent or delay our product development efforts.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ intellectual property may not be sufficient to protect our products from competition.
+
+ 
+ 
+
+ 8
+
+ 
+
+ 
+
+ 
+
+Implications
+of Being an Emerging Growth Company and a Smaller Reporting Company
+
+ 
+
+We
+are an "emerging growth company" as defined in the Jumpstart Our Business Startups Act, or the JOBS Act, enacted in April
+2012, and we will remain an emerging growth company until the earliest to occur of: the last day of the fiscal year in which we have
+more than $1.07 billion in annual revenue; the date we qualify as a "large accelerated filer," with at least $700 million
+of equity securities held by non-affiliates; the issuance, in any three-year period, by us of more than $1.0 billion in non-convertible
+debt securities; and the last day of the fiscal year ending after the fifth anniversary of our initial public offering. For so long as
+we remain an emerging growth company, we are permitted and intend to rely on certain exemptions from various public company reporting
+requirements, including not being required to have our internal control over financial reporting audited by our independent registered
+public accounting firm pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive
+compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote
+on executive compensation and any golden parachute payments not previously approved. In particular, in this prospectus, we have provided
+only two years of audited financial statements and have not included all of the executive compensation-related information that would
+be required if we were not an emerging growth company. Accordingly, the information contained herein may be different than the information
+you receive from other public companies in which you hold stock.
+
+ 
+
+In
+addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with
+new or revised accounting standards. This provision allows an emerging growth company to delay the adoption of some accounting standards
+until those standards would otherwise apply to private companies. We have elected to take advantage of the extended transition period
+to comply with new or revised accounting standards and to adopt certain of the reduced disclosure requirements available to emerging
+growth companies. As a result, we will not be subject to the same implementation timing for new or revised accounting standards as other
+public companies that are not emerging growth companies which may make comparison of our financial statements to those of other public
+companies more difficult. As a result of this election, the information that we provide in this prospectus may be different than the
+information you may receive from other public companies in which you hold equity interests.
+
+ 
+
+We
+are also a smaller reporting company as defined in the Securities Exchange Act of 1934, as amended. We may continue to be a smaller reporting
+company even after we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available
+to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as (i) the market value of
+our voting and non-voting common stock held by non-affiliates is less than $250 million measured on the last business day of our second
+fiscal quarter or (ii) our annual revenue is less than $100 million during the most recently completed fiscal year and the market value
+of our voting and non-voting common stock held by non-affiliates is less than $700 million measured on the last business day of our second
+fiscal quarter. Specifically, as a smaller reporting company, we may choose to present only the two most recent fiscal years of audited
+financial statements in our Annual Report on Form 10-K and have reduced disclosure obligations regarding executive compensation, and,
+similar to emerging growth companies, if we are a smaller reporting company with less than $100 million in annual revenue, we would not
+be required to obtain an attestation report on internal control over financial reporting issued by our independent registered public
+accounting firm.
+
+ 
+
+Corporate
+Information
+
+ 
+
+We
+were formed as a Delaware limited liability company in February 2014. Prior to the closing of this offering, Hemoglobin Oxygen Therapeutics
+LLC intends to convert into a Delaware corporation pursuant to a statutory conversion, and will change its name to Hemoglobin Oxygen
+Therapeutics Inc. See "Corporate Conversion."
+
+ 
+
+ 9
+
+ 
+
+ 
+
+ 
+
+Hemoglobin
+Oxygen Therapeutics LLC was organized in February 2014 in connection with the acquisition of OPK Biotech LLC through a Chapter 7 bankruptcy
+auction. The assets we acquired from OPK Biotech LLC consisted of equipment, intellectual property, finished product inventory and the
+capital stock of companies incorporated in the Netherlands and South Africa. OPK Biotech had in turn acquired certain assets from Biopure
+Corporation and intellectual property from Northfield Laboratories. Our principal executive offices are located at 674 Souder Road, Souderton,
+PA 18964 and our telephone number is (267) 382-0064. Our website address is www.hbo2therapeutics.com. The information contained on our
+website is not incorporated by reference into this prospectus, and you should not consider any information contained on, or that can
+be accessed through, our website as part of this prospectus or in deciding whether to invest in our common stock.
+
+ 
+
+Product
+History
+
+ 
+
+Biopure
+Corporation developed a veterinary (Oxyglobin) and a human (Hemopure) product and by the end of 1990 s received its veterinary
+product approval by the FDA (US) and the EMA (EU). The expensive production process, however, did not allow Biopure to sell the veterinary
+product at a profit and the Company continued its pursuit of human approval. Biopure went public in the early 2000s and traded at a market
+capitalization in excess of a billion dollars. The total funds spent by Biopure on the product development during its existence was around
+$900 million.
+
+ 
+
+In
+the early-2000s, an ill-designed Phase 3 clinical trial protocol followed by several managerial missteps led to difficulties, and Biopure
+was sold in 2009 to OPK Biotech (beneficial owner Sergey Pugachev). The new owner invested an additional $100 million to improve the
+production process resulting in significant reductions in the cost of producing the company s products. In 2011, Mr. Pugachev became
+involved in litigation with the Russian government which resulted in the expropriation of all his Russian assets. The beneficial owner s
+financial difficulties in Russia and inability to financially support the company led to conflict with the management of OPK Biotech,
+resulting in OPK Biotech management departure from the Company in early 2013. In 2014, creditors of OPK Biotech initiated a Chapter 7
+bankruptcy process, which eventually resulted in the seizure of OPK assets and the sale of such assets through an auction.
+
+ 
+
+Hemoglobin
+Oxygen Therapeutics LLC was formed in 2014 with the sole purpose of buying the assets of OPK Biotech. HbO2 Therapeutics participated
+in that auction and won the bid. After purchasing those assets in late 2014, HbO2 Therapeutics elected to consolidate three production
+facilities and house the whole process under one roof in Souderton, PA. Currently all of the equipment is waiting to be assembled in
+the newly erected building in Souderton, pending the proceeds of this Offering.
+
+ 
+
+ 10
+
+ 
+
+ 
+
+ 
+
+THE
+OFFERING
+
+ 
+
+ 
+ Shares
+ offered by us
+ 
+ ___
+ shares.
+
+ 
+ 
+ 
+ 
+
+ 
+ Common
+ stock outstanding prior to this offering
+ 
+ ___
+ shares
+
+ 
+ 
+ 
+ 
+
+ 
+ Common
+ stock to be outstanding immediately after this offering
+ 
+ _______
+ shares ( _______shares if the underwriters exercise their over-allotment option in full)
+
+ 
+ 
+ 
+ 
+
+ 
+ Option
+ to purchase additional shares
+ 
+ The
+ underwriters have an option for a period of 45 days to purchase up to an additional ____shares of our common stock and/or Warrants
+ to purchase up to ___ additional shares of our common stock (equal to 15% of the number of shares of common stock sold in the offering),
+ from us in any combination thereof.
+
+ 
+ 
+ 
+ 
+
+ 
+ Use
+ of proceeds
+ 
+ We
+ estimate that the net proceeds from this offering will be approximately $___, or approximately $____if the underwriters exercise
+ their over-allotment option in full, at an assumed public offering price of $___ per share, after deducting the underwriting discounts
+ and commissions, the non-accountable expense allowance payable to the underwriters, and estimated offering expenses payable by us.
+ We intend to use approximately $20 million of the net proceeds from this offering toward reassembling our facility in Souderton,
+ Pennsylvania and the balance for general corporate expenses and working capital. See "Use of Proceeds" for a more
+ complete description of the intended use of proceeds from this offering.
+
+ 
+ 
+ 
+ 
+
+ 
+ Lock-up
+ agreements
+ 
+ Our
+ executive officers, directors and shareholders have agreed with the underwriters not to sell, transfer or dispose of any shares or
+ similar securities for a period of 180 days after the date of this prospectus. For additional information regarding our arrangement
+ with the underwriters, please see "Underwriting."
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001617765_evome_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001617765_evome_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..cc2c1b95a45777874d3d71a811b1666d264217af
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001617765_evome_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary is not complete and does not contain all of the information that you should consider before deciding whether to invest in our common shares. Investing in our common shares involves a high degree of risk. For a more complete understanding of our Company and our common shares, we encourage you to read and consider the more detailed information included in this prospectus, including "Risk Factors," "Special Note Regarding Forward-Looking Statements," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and related notes, interim financial statements and related notes. See also "Where You Can Find Additional Information." Company Overview Salona Global Medical Device Corporation ("we," "us," "our," "Salona," or the "Company" as the context requires) is a United States-based medical technology company which aims to leverage the Canadian capital markets to acquire small to midsize US and internationally based medical device products and companies with the goal of expanding sales and improving operations to create a large, broad-based medical device company with a global reach. The Company's common shares trade on the TSXV under the symbol "SGMD". We operate through the following U.S. subsidiaries: Our subsidiary South Dakota Partners Inc. ("SDP") produces proprietary and white label medical devices for pain management, cold and hot therapy, NMES, PEMF and ultrasound. Our subsidiary Simbex, LLC ("Simbex") is an IP-based business with a portfolio of several revenue and royalty generating products ranging from wearable technology to products for physical stability as well as expertise in development and design of many medical devices on the market. Our subsidiary ALG Health Plus, LLC ("ALG Health Plus") is engaged in selling medical devices and supplies to small, independent hospitals, group purchasing organizations, medical offices and clinics in the United States. Our subsidiary Mio-Guard LLC ("Mio-Guard") is a medical device sales and marketing business serving the athletic training, physical therapy and orthopedics markets for sports medicine products in the mid-western, southern and central United States. Private Offering On February 15, 2022, we completed a private placement of 7,749,000 units (the "Units") at C$0.55 per Unit for gross proceeds of approximately C$4.26 million ("the "Private Offering") pursuant to the terms of subscription agreements with purchasers (the "Subscription Agreements") and an Underwriting Agreement (as defined below). Each Unit consisted of one common share of the Company and one warrant (a "Warrant") to purchase one common share in the capital of the Company (a "Warrant Share") at an exercise price of C$0.70 expiring on February 15, 2025. The exercise price of the Warrants is subject to adjustment for certain events, including without limitation, dividends, distributions or stock splits, subsequent rights offerings by the Company, or in the event of the Company's consolidation, merger or reorganization. We intend to use the proceeds of the Private Offering for working capital and general corporate purposes. As filed with the Securities and Exchange Commission on August 24, 2022 Registration No. 333-266806 Table of Contents ABOUT THIS PROSPECTUSiii IMPLICATIONS OF BEING AN EMERGING GROWTH COMPANY AND A SMALLER REPORTING COMPANYiv CURRENCY AND EXCHANGE RATESv SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTSv PROSPECTUS SUMMARY1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001623414_justworks_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001623414_justworks_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001623414_justworks_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001676852_omnia_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001676852_omnia_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001676852_omnia_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001685428_lumiradx_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001685428_lumiradx_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001685428_lumiradx_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001689084_qrons-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001689084_qrons-inc_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..c1d769478ab0ef4100b456bcca0c13d223b8c079
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001689084_qrons-inc_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary provides an overview of selected information and does not contain all of the information you should consider before investing in our securities. You should read the entire prospectus carefully, especially the Risk Factors, and our financial statements and the accompanying notes to those statements, included elsewhere in this prospectus, before making an investment decision. Overview We were incorporated under the laws of the State of Wyoming on September 22, 2016 as BioLabMart Inc. and changed our name to Qrons Inc. on September 8, 2017. We are an innovative biotechnology company dedicated to developing biotech products, treatments and technologies that create a platform to combat neuronal diseases. We seek to engage in strategic arrangements with companies and institutions that are developing breakthrough technologies in the fields of artificial intelligence ( AI ), machine learning ( ML ), molecular biology, stem cells and tissue engineering, for deployment in the fight against neuronal diseases. Our search is focused on researchers based in Israel, a country which is world-renowned for biotech innovations. To date, the Company has collaborated with universities and scientists in the fields of regenerative medicine, tissue engineering and 3D printable hydrogels to develop a treatment that integrates proprietary, engineered mesenchymal stem cells ( MSCs ), 3D printable implant, smart materials and a novel delivery system and has two product candidates for treating penetrating and non-penetrating (concussion-like) traumatic brain injuries ( TBIs ), both integrating proprietary, anti-brain inflammation synthetic hydrogel and modified MSCs. We have not generated any revenue from the sale of products. The Company has relied primarily on its two co-founders, Jonah Meer, Chief Executive Officer, and Ido Merfeld, President, who are its sole officers and directors to manage its day-to-day business and has outsourced professional services to third parties in an effort to maintain lower operational costs. Messrs. Meer and Merfeld, as the holders of the Company s issued and outstanding shares of the Company s Class A Preferred Stock, collectively have 66 2/3% of the voting rights of the Company. Acting together, they will be able to influence the outcome of all corporate actions requiring approval of our stockholders. As filed with the Securities and Exchange Commission on January 3, 2022 Registration No. 333-261437 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 __________________________ AMENDMENT NO. 1 TO FORM S-1 /A REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 __________________________ QRONS INC. (Exact name of registrant as specified in its charter) Wyoming 2836 81-3623646 (State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer incorporation or organization) Classification Code Number) Identification Number) 28-10 Jackson Avenue #26N Long Island City, New York 11101 (212) 945-2080 Email: jmeer@qrons.com (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) Jonah Meer Chief Executive Officer Qrons Inc. 28-10 Jackson Avenue #26N Long Island City, New York 11101 (212) 945-2080 Email: jmeer@qrons.com (Name, address, including zip code, and telephone number, including area code, of agent for service) __________________________ Copies to: Nancy Brenner, Esq. Brenner & Associates, PLLC 1 Kensington Gate Suite 106 Great Neck, NY 11021 (917) 282-4272 Email: nbrenneresq@gmail.com Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this Registration Statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. [X] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act. Large accelerated filer [ ] Accelerated filer [ ] Non-accelerated filer [X] Smaller reporting company [X] Emerging growth company [X] If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. [ ] CALCULATION OF REGISTRATION FEE Title of Class of Securities to be Registered Amount of Shares to be Registered Proposed Maximum Offering Price Per Share Proposed Maximum Aggregate Offering Price Amount of Registration Fee Company Offering Common Stock, par value $0.0001 per share (1)(2) 2,500,000 $0.70 $1,750,000.00 $162.23 Selling Shareholder Offering Common Stock, par value $0.0001 per Share(1)(2) 2,866,429 $0.70 $2,006,500.30 $186.00 Common Stock, par value $0.0001 per share, issuable upon conversion of convertible promissory notes by the selling shareholders (1)(2)(3) 490,000 $0.70 $343,000.00 $31.80 Common Stock, par value $0.0001 per share, issuable upon exercise of common stock purchase warrants by the selling shareholders (1)(2)(3) 295,000 $0.70 $206,500.00 $19.14 Total $399.17* (1) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(o) of the Securities Act of 1933, as amended (the Securities Act ). (2) Pursuant to Rule 416 under the Securities Act, the securities being registered hereunder include such indeterminate number of additional shares of common stock as may be issued after the date hereof as a result of stock splits, stock dividends or similar transactions. (3) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(c) under the Securities Act, based on the closing sale price of the registrant s common stock on the OTCQB of $0.70 per share on December 22, 2021. *Previously paid $439.09 The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to Section 8(a), may determine. The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED JANUARY 3, 2022 COVID-19 The COVID-19 pandemic has had an adverse impact on the research and development of our product candidates. Research facilities at Dartmouth were subject to closures as well as laboratories at Ariel in Israel during fiscal 2020. This resulted in our discontinuing our research at these Universities and was part of our decision to adjust our research to be collaborative and to seek aligning with third parties to advance our expanded goals. We do not currently know the full extent of potential delays of research in the future as a result of the continuing pandemic restrictions. COVID-19 also caused significant disruptions to the global financial markets, particularly in early 2020, which severely impacted our ability to raise additional capital. This resulted in our terminating our employees in April 2020 in an effort to conserve resources as we evaluated our business development efforts. The ultimate impact on us and our research relationships is currently uncertain. We may be required to further reduce operations or cease operations if we are unable to finance our operations. Management is actively monitoring the situation but given the continued evolution of the COVID-19 outbreak, the Company is not able to fully estimate the effects of the COVID-19 outbreak on its planned operations or financial condition in the next 12 months. However, while significant uncertainty remains, the Company believes it is likely that the COVID-19 outbreak will have a negative impact on its ability to raise additional financing and will result in delays as it continues to impact the Company s development efforts. Risk Factors Our business is subject to a number of risks. You should be aware of these risks before making an investment decision. These risks are discussed more fully in the section of this prospectus titled Risk Factors, which begins on page 4 of this prospectus and includes: We have a history of losses; We have incurred significant losses since inception and we expect to incur losses over the next several years and may not be able to achieve or sustain revenues or profitability in the future; We will be required to raise significant additional financing; We have a significant amount of indebtedness; Our independent public accounting firm has expressed substantial doubt about our ability to continue as a going concern; Because our product candidates are in an early stage of development, there is a high risk of failure, and we may never succeed in developing marketable products or generating product revenues; We may be unable to protect our intellectual property; Market acceptance of our products is still uncertain; Investors in the Offering may lose their entire investment. Corporate Information Our principal executive offices are located at 28-10 Jackson Avenue, #26N Long Island City, New York 11101. Our telephone number is (212) 945-2080. Our website address is www.qrons.com. Information contained in, or that can be accessed through, our website is not incorporated by reference into this prospectus, and you should not consider information on our website to be part of this prospectus. PRELIMINARY PROSPECTUS QRONS INC. Offer of up to 2,500,000 shares of common stock offered by the Company and 3,651,429 shares offered by Selling Shareholders We are offering to sell up to 2,500,000 shares of common stock in a self-underwritten primary offering at a fixed price of $0.70 per share for a period of two years from the effective date of this prospectus (the Offering ). The Offering will terminate on the earlier of (i) the date when the sale of all 2,500,000 shares is completed, (ii) when the board of directors of the Company decides that it is in the best interest of the Company to terminate the Offering prior the completion of the sale of all 2,500,000 shares registered under the Registration Statement of which this prospectus is part or (iii) two years after the effective date of this prospectus. This prospectus also relates to the offer and sale of 3,651,429 shares of common stock by the holders identified in this prospectus or their assigns (each a Selling Shareholder and, collectively, the Selling Shareholders ), which includes (i) 295,000 shares issuable upon the exercise of warrants ( Warrants ) at an exercise price of $1.00 per share (the Warrant Shares ) and (ii) 490,000 shares issuable upon the conversion of promissory notes (the Conversion Shares ). The Company will realize no proceeds from sales of common stock by the Selling Shareholders. However, if the Selling Shareholders exercise their Warrants for cash then in the future, we may receive up to an aggregate of $295,000 in additional proceeds upon the exercise of the Warrants. The Selling Shareholders may be deemed underwriters within the meaning of the Securities Act of 1933, as amended (the Securities Act ), in connection with the resale or other disposition of the shares of common stock covered by this prospectus. The Company intends to maintain the current status and accuracy of this prospectus and to allow the Company to offer and sell the shares for a period of up to two years, unless earlier completely sold, pursuant to Rule 415 of the General Rules and Regulations of the Securities and Exchange Commission (the SEC ). All costs incurred in the registration of the shares offered pursuant to this prospectus are being borne by the Company. The Company does not have any current arrangements nor entered into any agreements with any underwriters, broker-dealers or selling agents for the sale of the shares in the Offering. If the Company can locate and enter into any such arrangement(s), the shares will be sold through such licensed underwriter(s), broker-dealer(s) and/or selling agent(s). The Company will offer the shares in its Offering directly without payment to any officer or director of any commission or compensation for sale of the shares. The Selling Shareholders, or their respective transferees, pledgees, donees or other successors-in-interest, may sell the shares through public or private transactions at prevailing market prices, at prices related to prevailing market prices or at privately negotiated prices. The Selling Shareholders may sell any, all or none of the securities offered by this prospectus, and we do not know when or in what amount the selling shareholders may sell their shares hereunder following the effective date of this registration statement. We provide more information about how a selling shareholder may sell its shares in the section titled Plan of Distribution . Our common stock is quoted on the OTCQB under the symbol "QRON". On December 22, 2021 , the last reported sale price for our common stock was $0.70 per share. We are an "emerging growth company," as that term is used in the Jumpstart Our Business Startups Act of 2012 ( JOBS Act ). INVESTING IN OUR SECURITIES INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD CONSIDER CAREFULLY THE SECTION ENTITLED "RISK FACTORS" IN THIS PROSPECTUS BEGINNING ON PAGE 4. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read the entire prospectus and any amendments or supplements carefully before you make your investment decision. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed on the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. The date of this prospectus is ____________, 2021 THE OFFERING Common stock outstanding prior to the Offering (as of December 22 , 2021) 13,289,789 shares Shares of common stock offered by us in the Offering 2,500,000 shares Offering price for shares sold in the Offering $0.70 Common stock outstanding after completion of the Offering (assuming all of the shares have been sold and none of the shares offered by the Selling Shareholders have been issued) 15,789,789 shares Common stock offered by the Selling Shareholders 3,651,429 shares, consisting of (i) 2,866,429 shares of our common stock issued and outstanding, (ii) 490,000 Conversion Shares issuable upon exercise of outstanding convertible promissory notes held by certain of the Selling Shareholders, and (iii) 295,000 shares of our common stock issuable upon exercise of Warrants held by certain of the Selling Shareholders. Common stock outstanding after the Selling Shareholders Offering (assuming all of the shares offered in the Offering and all the shares offered by the Selling Shareholders have been issued and sold) 16,574,789 Use of proceeds We intend to use the net proceeds from the Offering after deducting the estimated offering expenses for sales and marketing activities, product development, including through the use of strategic arrangements with companies and institutions making use of technologies, solutions or businesses that complement our business, and for working capital and general corporate purposes. See Use of Proceeds on page 22 of this prospectus. We will not receive any proceeds from the sale of any shares by the Selling Shareholders in the Selling Shareholders Offering. However, if the Selling Shareholders exercise their Warrants for cash then in the future, we may receive up to an aggregate of $295,000 in additional proceeds upon the exercise of the Warrants. OTCQB Symbol Our common stock is presently quoted on the OTCQB Marketplace under the symbol QRON. Risk factors Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 4. TABLE OF CONTENTS Page Explanatory Note 1 Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001696396_stealth_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001696396_stealth_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..9031a9f4b650346d94ecc69b6acca97ebd334137
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001696396_stealth_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus and is qualified in its entirety by the more detailed information and financial statements incorporated by reference or included elsewhere in this prospectus. It does not contain all of the information that you should consider in making your investment decision. Before investing in the Ordinary Shares represented by ADSs, you should carefully read this entire prospectus, including our consolidated financial statements and the related notes incorporated by reference or included elsewhere in this prospectus. You should also consider, among other things, the matters described under Risk Factors beginning on page [ ]. Except as otherwise indicated herein or as the context otherwise requires, references in this prospectus to Stealth, the Company, we, us and our refer to Stealth BioTherapeutics Corp and its consolidated subsidiaries, or any one or more of them as the context may require. Overview of Stealth BioTherapeutics Corp We are a clinical-stage biotechnology company focused on the discovery, development and commercialization of novel therapies for diseases involving mitochondrial dysfunction. Mitochondria, found in nearly every cell in the body, are the body s main source of energy production and are critical for normal organ function. Dysfunctional mitochondria characterize a number of rare genetic diseases and many common age-related diseases, leading to devastating cardiac, ophthalmic and neurological symptoms. We believe our product candidates have significant potential to treat the cardiac, ophthalmic and neurological symptoms of both rare genetic and common age-related mitochondrial diseases. Our mission is to be the leader in mitochondrial medicine, and we have assembled a highly experienced management team, board of directors and group of scientific advisors to help us achieve this mission. Our first clinical product candidate, elamipretide, is a small peptide that targets and binds reversibly to cardiolipin, an essential structural element of mitochondria, stabilizing the inner mitochondrial membrane under conditions of oxidative stress. This novel mechanism of action has shown potential clinical benefit in both rare genetic and common age-related ophthalmic and cardiac diseases entailing mitochondrial dysfunction. We have exclusive worldwide rights to elamipretide and SBT-20, both of which we licensed from Cornell University and Institut de recherches cliniques deMontr al, in 2006. We are studying elamipretide in geographic atrophy, an advanced form of dry age-related macular degeneration and primary mitochondrial myopathy due to nuclear DNA. We are also evaluating the potential for additional clinical trials of elamipretide in the following neuromuscular and cardiac diseases in which mitochondrial dysfunction is implicated: Duchenne muscular dystrophy where deficits in dystrophin and associated mitochondrial dysfunction lead to a progressive decline in skeletal and cardiac muscle function; and Barth syndrome, BTHS, where deficits in cardiolipin lead to a progressive decline in skeletal and cardiac muscle function. Our second clinical product candidate, SBT-272, is a novel peptidomimetic that has been shown to increase adenosine triphosphate production and decrease levels of reactive oxygen species in dysfunctional mitochondria in preclinical studies. We are developing SBT-272 for rare neurological diseases involving mitochondrial dysfunction, with a preliminary focus on amyotrophic lateral sclerosis and frontotemporal lobar degeneration. We have also discovered and own over 100 compounds, including SBT-272 and the SBT-550 family, that also target the mitochondria and form the basis of our broad proprietary pipeline of mitochondrial-targeted product candidates. We are evaluating compounds in the SBT-550 family for rare neurological indications. In addition, our internal discovery platform has generated a library of over 100 differentiated proprietary compounds which could have clinical benefit for diseases related to mitochondrial dysfunction and from which we plan to designate potential product candidates. We may also utilize certain of these compounds as part of our carrier program, in which they could potentially serve as scaffolds to deliver other beneficial compounds to the mitochondria. Description of Transaction On April 10, 2022, we entered into a securities purchase agreement, or the Securities Purchase Agreement, with the selling shareholder identified in this prospectus, or the Selling Shareholder pursuant to which we agreed to issue and sell in a registered direct offering an aggregate of 5,583,028 ADSs at a purchase price of $0.6269 per ADS. The ADSs were offered by the us pursuant to an effective registration statement on Form F-3, which was originally filed with the Securities and Exchange Commission, or the SEC on April 2, 2020 and was declared effective on April 10, 2020 and a prospectus supplement thereunder. Pursuant to the Securities Purchase Agreement, in a concurrent private placement, we also agreed to issue and sell to the Selling Shareholder an unregistered warrant to purchase up to 44,217,588 Ordinary Shares in the form of 3,684,799 ADSs, or the Warrant. The Warrant will be exercisable commencing on October 13, 2022, or the Initial Exercise Date, at an exercise price of $0.6269 per ADS and will expire on the five-year anniversary of the Initial Exercise Date. Pursuant to the terms of Securities Purchase Agreement, we have filed the registration statement of which this prospectus is a part to register for resale under the Securities Act of 1933, or the Securities Act, the Ordinary Shares underlying the Warrant in the form of ADSs. We will not receive any proceeds from the sale of the Ordinary Shares represented by ADSs by the Selling Shareholder, we will receive proceeds from the exercise of any Warrants for cash. Our Corporate Information We were incorporated in April 2006 under the name of Stealth Peptides International Inc as an exempted company incorporated with limited liability under the laws of the Cayman Islands, and we changed our name in June 2015 to Stealth BioTherapeutics Corp. Our registered office is located at c/o Intertrust Corporate Services (Cayman) Limited, One Nexus way, Camana Bay, Grand Cayman, KY1-9005 Cayman Islands. Our agent for service of process in the United States is Stealth BioTherapeutics Inc. ( Stealth Delaware ), and the executive offices of Stealth Delaware are located at 140 Kendrick Street, Needham, MA 02494, and the telephone number there is (617) 600-6888. Our website address is www.stealthbt.com. The information contained on, or that can be accessed through, our website is not a part of this prospectus. We have included our website address in this prospectus solely as an inactive textual reference. Stealth BioTherapeutics, the Stealth BioTherapeutics logo and our other trademarks or service marks appearing in this prospectus are the property of Stealth BioTherapeutics or our subsidiaries. Risks Associated with Our Business Our business is subject to a number of risks of which you should be aware before making an investment decision. These risks are discussed more fully in the Risk Factors section of this prospectus beginning on page 12 of this prospectus. These risks include, but are not limited to, the following: We will need substantial additional funding. If we are unable to raise capital when needed, we will be forced to delay, reduce or eliminate our research and drug development programs or commercialization efforts. If we do raise additional capital, it may cause dilution to our shareholders. Based on our cash balances, recurring losses and our projected spending in 2022, there is a substantial doubt about our ability to continue as a going concern. We have incurred significant losses since inception. We expect to incur losses for the foreseeable future and may never achieve or maintain profitability. As of March 31, 2022, we had an accumulated deficit of $616.1 million. We depend heavily on the success of our clinical product candidates, and we cannot be certain that we will receive regulatory approval for any of our product candidates or if we will successfully commercialize any of our product candidates even if we receive such regulatory approval. If the U.S. Food and Drug Administration does not accept or approve our New Drug Application, or NDA, for our most advanced product candidates, it may require that we conduct additional clinical, nonclinical or manufacturing validation studies and submit that data before it will reconsider our applications. Our approach to the discovery and development of product candidates that target mitochondria is unproven, and we do not know whether we will be able to develop any products of commercial value. If clinical trials of our product candidates fail to demonstrate safety and efficacy to the satisfaction of regulatory authorities or do not otherwise produce positive results, we may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization of our product candidates. We expect to depend on third parties for the development, marketing and/or commercialization of our product candidates in some cases. If those collaborations are not successful, we may not be able to capitalize on the market potential of our product candidates. We hold exclusive licenses from the Cornell Research Foundation, or Cornell, and the Institut de recherches cliniques de Montr al for our lead clinical-stage product candidate elamipretide. If these third parties terminate their agreements with us, our competitive position and our market share will be harmed. For example, our license agreement with Cornell required us to commercialize a product by December 31, 2020, subject to specified exceptions for causes due to scientific and regulatory events that are common in drug development, and Cornell has the right to terminate the license if we do not comply. We believe that our noncompliance is subject to the named exceptions, and to date we have not received any notice of termination from Cornell. Morningside Venture (I) Investments Limited has a controlling interest in us and is able to control all matters submitted to our shareholders for approval that require an ordinary resolution or special resolution, as well as our management and affairs. As a foreign private issuer, we are exempt from a number of rules under the U.S. securities laws and Nasdaq Stock Market, and corporate governance rules and are permitted to file less information with the SEC, than U.S. companies. This may limit the information available to holders of our securities. If we fail to meet the requirements for continued listing on the Nasdaq Global Market or Nasdaq, our ADSs could be delisted from trading, which would decrease the liquidity of our ADSs and our ability to raise additional capital. Implications of Being an Emerging Growth Company We qualify as an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions include: an exemption from compliance with the auditor attestation requirement of Section 404 of the Sarbanes-Oxley Act of 2002 on the design and effectiveness of our internal controls over financial reporting; an exemption from compliance with any requirement that the Public Company Accounting Oversight Board may adopt regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements; reduced disclosure about the company s executive compensation arrangements; and exemptions from the requirements to obtain a non-binding advisory vote on executive compensation or a shareholder approval of any golden parachute arrangements. We may take advantage of these provisions until December 31, 2024 or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company upon the earlier to occur of: the last day of the fiscal year in which we have more than $1.07 billion in annual revenues; the date we qualify as a large accelerated filer, with a non-affiliate public float in excess of $700 million; or the issuance by us of more than $1 billion of non-convertible debt over a three-year period. We may choose to take advantage of some, but not all, of the available benefits under the JOBS Act. We have taken advantage of some reduced reporting burdens in this prospectus. Accordingly, the information contained herein may be different than the information you receive from other public companies in which you hold securities. In addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. This provision allows an emerging growth company to delay the adoption of some accounting standards until those standards would otherwise apply to private companies. We have elected to avail ourselves of this exemption from new or revised accounting standards and, therefore, we will not be subject to the same new or revised accounting standards as other public companies. Implications of Being a Foreign Private Issuer Our status as a foreign private issuer also exempts us from compliance with certain laws and regulations of the SEC and certain regulations of Nasdaq. Consequently, we are not subject to all of the disclosure requirements applicable to companies organized within the United States. For example, we are exempt from certain rules under the Exchange Act that regulate disclosure obligations and procedural requirements related to the solicitation of proxies, consents or authorizations applicable to a security registered under the Exchange Act. In addition, our executive officers, directors and principal shareholders are exempt from the reporting and short-swing profit recovery provisions of Section 16 of the Exchange Act and related rules with respect to their purchases and sales of our securities. Moreover, we are not required to file periodic reports and financial statements with the SEC as frequently or as promptly as U.S. public companies. Accordingly, there may be less publicly available information concerning our company than there is for U.S. public companies. In addition, foreign private issuers are not required to file their annual report on Form 20-F until 120 days after the end of each fiscal year, while U.S. domestic issuers that are non-accelerated filers are required to file their annual report on Form 10-K within 90 days after the end of each fiscal year. Foreign private issuers are also exempt from the Regulation Fair Disclosure, aimed at preventing issuers from making selective disclosures of material information. We may take advantage of these exemptions until such time as we no longer qualify as a foreign private issuer. In order to maintain our current status as a foreign private issuer, either a majority of our Ordinary Shares must be directly or indirectly owned of record by non-residents of the United States, or a majority of our executive officers or directors may not be United States citizens or residents, more than 50% of our assets cannot be located in the United States and our business must be administered principally outside the United States.
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+PROSPECTUS SUMMARY 1
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+The ongoing COVID-19 pandemic, restrictions intended to prevent its spread and resulting worldwide economic conditions could adversely impact our business, financial condition, and results of operations. The ongoing COVID-19 pandemic, and restrictions intended to prevent its spread have already had a significant adverse impact on economic conditions around the world, including the United States. The impact of the COVID-19 pandemic continues to evolve. The extent to which COVID-19 may continue to impact our business will depend on future developments, which are highly uncertain and cannot be predicted with confidence, such as new variants and the further spread of the disease, the duration of any significant outbreaks, implementation of travel restrictions, social distancing and other restrictions, business closures or business disruptions and the effectiveness of actions taken in the United States and other countries to contain and treat the disease. Should COVID-19 continue to spread, our business operations could be delayed or interrupted. Current and potential government-imposed travel restrictions could also affect our supply and distribution chain. The spread of COVID-19 throughout the world has also created global economic uncertainty and that may continue. This may cause potential customers to delay working with new suppliers, such as us, and for consumers to reduce their spending budget for premium items, such as our shrimp. Any of the foregoing could have a material adverse effect on our business, financial condition, and results of operations. We rely on key executive officers and scientific advisors, and their knowledge of our business and technical expertise would be difficult to replace. We are highly dependent on the expertise of Michael B. Ziebell, our Chief Executive Officer, Robert J. Vold, our Chief Financial Officer, and Bruce Paterson, PhD, our Chief Technical Officer, as well as our scientific advisors. While we have employment agreements with each of Mr. Ziebell, Mr. Vold, and Dr. Paterson, employment agreements cannot ensure the retention of the employees covered by such agreements. We do not have key person life insurance policies for any of our officers. Our success depends substantially on the efforts and abilities of our officers and other key employees. The loss of any key members of our management, or the failure to attract or retain other key employees who possess the requisite expertise for the conduct of our business, could prevent us from developing and advancing our products and executing our business strategy, and could have a material adverse effect on our business, financial condition, and results of operations. If we are unable to hire additional qualified personnel, it could delay our commercialization plans or harm our research and development efforts, and we may be unable to develop or sell our products. Over time, we will need to hire additional qualified personnel to scale up commercial operations, to build out our sales, marketing, and distribution functions, and to obtain expertise for research and development and any government regulations with respect to our products. Our production facilities require individuals with scientific backgrounds and aquaculture experience. We may not be able to attract or retain qualified employees due to the intense competition for qualified personnel among aquaculture companies, biotechnology companies, universities, research institutions and other technology or scientific-based businesses, or due to the unavailability of personnel with the qualifications or experience necessary for our business. If we are unable to attract and retain the necessary personnel to accomplish our business objectives, we may experience staffing constraints that could adversely affect our ability to adequately staff existing or new production facilities, support our research and development plans, build out marketing, sales and distribution capabilities, and/or produce and deliver our planned products to meet customer demand in a timely fashion, and any such issues could have a material adverse effect on our business, financial condition, and results of operations. We may encounter difficulties managing our growth, which could adversely affect our business. We expect to face a period of rapid growth which will likely place significant pressure on our management, sales, operational, and financial resources. We expect these pressures to continue to grow as we advance our Balaton Bay Reef pilot production facility, build and launch our Madison Bay Harbor, and develop and launch chitosan-related products. The execution of our business plan and our future success will depend, in part, on our ability to manage current and planned expansion and on our ability to continue to implement and improve our operational management. To manage this growth, we must expand our facilities, augment our operational, financial and management systems, and hire and train additional qualified personnel. Any failure to manage the planned growth may have a material adverse effect on our business, financial condition, and results of operations. We may pursue strategic acquisitions and investments that could have an adverse impact on our business if they are unsuccessful. If appropriate opportunities become available, we may acquire businesses, assets, technologies, or products to enhance our business in the future. In connection with any future acquisitions, we could: issue additional equity securities, which would dilute our current shareholders; incur substantial debt to fund the acquisitions; or assume significant liabilities. Acquisitions involve numerous risks, including: difficulties integrating the purchased operations, technologies, or products; unanticipated costs and other liabilities; diversion of management s attention from our core business; adverse effects on existing business relationships with current and/or prospective customers and/or suppliers; risks associated with entering markets in which we have no or limited prior experience; and potential loss of key employees. We do not have extensive experience in managing the integration process, and we may not be able to successfully integrate any businesses, assets, products, technologies, or personnel that we might acquire in the future without a significant expenditure of operating, financial, and management resources. The integration process could divert management time from operating our business, result in a decline in employee morale, or cause retention issues to arise from changes in compensation, reporting relationships, future prospects, or the direction of the business. Acquisitions also may require us to record goodwill and non-amortizable intangible assets that will be subject to impairment testing on a regular basis and potential periodic impairment charges, incur amortization expenses related to certain intangible assets, and incur large and immediate write-offs, and restructuring and other related expenses, all of which could harm our operating results and financial condition. We may acquire companies that have insufficient internal financial controls, which could impair our ability to integrate the acquired company and adversely impact our financial reporting. Our failure to integrate with respect to any of our acquisitions or our inability to efficiently operate as a combined organization could have a material adverse effect on our business, financial condition, and results of operations. We may be subject to significant liability that is not covered by insurance. Although we believe that the extent of our insurance coverage is consistent with industry practice, any claim under our insurance policies may be subject to certain exceptions, may not be honored fully, in a timely manner, or at all, and we may not have purchased sufficient insurance to cover all losses incurred. If we were to incur substantial liabilities or if our business operations were interrupted for a substantial period of time, we could incur costs and suffer losses. Such inventory and business interruption losses may not be covered by our insurance policies. We also expect that operating as a public company will make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified people to serve on our board of directors, our board committees or as executive officers. We do not know, however, if we will be able to maintain existing insurance with adequate levels of coverage. Any significant uninsured liability may require us to pay substantial amounts, which would have a material adverse effect on our business and financial condition. Additionally, in the future, insurance coverage may not be available to us at commercially acceptable premiums, or at all. Our ability to use net operating losses and other tax attributes to offset future taxable income may be subject to certain limitations. As of December 31, 2020, we had approximately $9.2 million of Federal net operating losses, or NOLs, carryforwards. In addition, as of December 31, 2020, the Company had approximately $1.0 million of research and development tax credits available for future use. Our NOL carryforwards, if not used, will begin to expire in 2038. Furthermore, Sections 382 and 383 of the United States Tax Code, or Code, a corporation that undergoes an ownership change is subject to limitations on its ability to utilize its pre-change NOLs, tax credits, or other tax attributes to offset future taxable income or taxes. For these purposes, an ownership change generally occurs where the aggregate stock ownership of one or more stockholders or groups of stockholders who own at least 5% of a corporation s stock increases its ownership by more than 50 percentage points over its lowest ownership percentage within a specified testing period. In addition to limitations imposed by the 2017 Tax Cuts and Jobs Act, a portion of our NOLs may be subject to substantial limitations arising from previous ownership changes, and, if we undergo another ownership change, our ability to utilize NOLs could be further limited by Sections 382 and 383 of the Code. In addition, future changes in our stock ownership, many of which are outside of our control, could result in an ownership change under Sections 382 and 383 of the Code. Our NOLs may also be impaired under state law. Accordingly, we may not be able to utilize a material portion of our NOLs. Furthermore, our ability to utilize our NOLs is conditioned upon our attaining profitability and generating United States federal and state taxable income. Risks Related to Government Regulation If we fail to obtain or maintain applicable regulatory clearances or registrations, or if such clearances or registrations are delayed, we will be unable to distribute and sell our products in a timely manner, or at all, which could significantly disrupt our business and materially and adversely affect our sales and profitability. Our business will be regulated at the federal, state and local levels, and our food products and distribution operations require various licenses, permits and registrations. For example: the products we plan to distribute in the United States will be subject to regulation and inspection by the United States Food and Drug Administration, or FDA; our shrimp processing operations will be subject to regulation and inspection by the FDA and state health authorities; and our United States trucking operations will be regulated by the United States Department of Transportation and the United States Federal Highway Administration. The processes for obtaining regulatory clearances or registrations can be lengthy and expensive, and the results are unpredictable. If we are unable to obtain clearances or registrations needed to market existing or new products, or to obtain such clearances or registrations in a timely fashion, our business would be significantly disrupted, and our sales and profitability could be materially and adversely affected. If we enter foreign markets, we lack the experience and familiarity with both the regulators and the regulatory systems, which could make the process more difficult, more costly, more time consuming and less likely to succeed. In addition, as a distributor of food products and chitosan products in the biomedical, pharmaceutical and other markets with human application, we will be subject to increasing governmental scrutiny of and public awareness regarding product safety and the sale, packaging and marketing of natural and organic products. Compliance with these laws may impose a significant burden upon our operations. If we were to distribute products that are or are perceived to be contaminated, or otherwise not in compliance with applicable laws, or if we experience any product recalls, there could be a material adverse effect on our business, financial condition, and results of operations. The FDA chitosan registration process is separate and in addition to the FDA shrimp processing registration. USP-grade chitosan is regulated by the FDA but not in the same manner as is the shrimp produced for food. The Company must be registered with the FDA as a supplier to manufacturers of medical applications that use our chitosan. We expect to apply for this FDA registration in the third quarter of 2022. There are risks that the Company may have significant difficulties or delays in developing the required GMP and protocols to obtain FDA registration as a supplier of chitosan. There is a risk that the Company will not be able to demonstrate sufficient consistency in output to obtain FDA registration as a supplier of chitosan. Failure to obtain FDA registration as a supplier of medical application chitosan would have a material adverse effect on the Company s revenues from chitosan. Obtaining necessary regulatory registrations may take time and thus delay purchases of our chitosan. Any failure to obtain or maintain necessary registrations could have a material adverse effect on our business, financial condition, and results of operations. Even inadvertent, non-negligent or unknowing violations of federal, state, or local regulatory requirements could expose us to adverse governmental action and materially adversely affect our business, financial condition and operating results. The Federal Food, Drug, and Cosmetic Act, or FDCA, which governs the shipment of foods in interstate commerce, generally does not distinguish between intentional and unknowing, non-negligent violations of the law s requirements. Most state and local laws operate similarly. Consequently, almost any deviation from subjective or objective requirements of the FDCA or state or local law leaves us vulnerable to a variety of civil and criminal penalties. As a rapidly growing company, we often deploy new equipment, update our facilities, or occupy new facilities. These activities require us to adjust our operations and regulatory compliance systems to meet rapidly changing conditions. Although we have adopted and implemented systems to prevent the production of unsafe or mislabeled products, any failure of those systems to prevent or anticipate an instance or category of deficiency could result in significant business interruption and financial losses to us. The occurrence of events that are difficult to prevent completely, such as the introduction of pathogenic organisms from the outside environment into our facilities, also may result in the failure of our products to meet legal standards. Under these conditions, we could be exposed to civil and criminal regulatory action. We cannot assure you that we will always be in full compliance with all applicable laws and regulations or that we will be able to comply with any future laws and regulations. Failure to comply with these laws and regulations could have a material adverse effect on our business, financial condition, and results of operations. An increase or change in government regulations could have a material adverse effect on our business. With a new presidential administration, we may see new legislation in product safety, health care or other areas that could impose regulations on our products. Adapting to new governmental regulations may require additional time, money and resources, and cause delays or prevent production and sale of our shrimp and/or chitosan product. Any such circumstances could have a material adverse effect on our business, financial condition, and results of operations. Our chitosan customers may require medical application standard certifications and we may be unable to obtain such certifications in a timely manner or at all. The FDA does not require that we obtain ISO Certification 13485, a medical device applications standard, but our customers may require it. Alternatively, our customers may require different medical specifications and certifications. We may not be able to obtain this ISO or other certifications, or it may take extra time and expense to obtain such certifications. If customers require different medical specifications and certifications, it could take time and expense to meet those required specifications. Failure to obtain and maintain such certification, or to meet other customer required specifications, could have a material adverse effect on our business, financial condition, and results of operations. Risks Related to Intellectual Property and Technology Systems If we fail to adequately protect or enforce our intellectual property rights, the value of our intellectual property rights would diminish. Our success, competitive position, and future revenues will depend in part on our ability to obtain and maintain patent protection for our products, methods, processes, and other technologies, to preserve our trade secrets, to prevent third parties from infringing on our proprietary rights and to operate without infringing the proprietary rights of third parties. To date, we hold certain patent rights, including an exclusive license to the patented Tidal Basin Technology, and we own two issued United States patents and a patent portfolio of United States applications, and foreign patents and applications related to our modification of the Tidal Basin Technology aquaculture platform. We anticipate filing additional patent applications in the United States. However, we cannot predict: the degree and range of protection any patents will afford us against competitors, including whether third parties will find ways to invalidate or otherwise circumvent our patents. if and when patents will be issued; and if granted, whether such patents will be challenged and held invalid or unenforceable. whether others will obtain patents claiming aspects similar to those covered by our patents and patent applications; or whether we will need to initiate litigation or administrative proceedings which may be costly, regardless of whether we win or lose. Our success also depends upon the skills, knowledge, and experience of our scientific and technical personnel, our consultants, and advisors as well as our licensors and contractors. To help protect our proprietary know-how and our inventions for which patents may be unobtainable or difficult to obtain, we will rely on trade secret protection and confidentiality agreements. These agreements may not provide adequate protection for our trade secrets, know-how, or other proprietary information in the event of any unauthorized use or disclosure or the lawful development by others of such information. If any of our trade secrets, know-how, or other proprietary information is disclosed, the value of our trade secrets, know-how, and other proprietary rights would be significantly impaired and there could be a material adverse effect on our business, financial condition, and results of operations. We have an exclusive license to patented Texas A&M University technology but cannot guarantee long-term licensing or exclusivity. We hold the exclusive patent rights to the super intense shallow water raceway technology, or SISWR, developed by Texas A&M University to produce shrimp in an indoor aquaculture setting. We constructed a shrimp laboratory and conducted research to validate the SISWR technology. The SISWR system is a key component of our overall shrimp growing technology. We cannot guarantee the SISWR license will be long-term or exclusive. Our SISWR license may terminate, or may become non-exclusive, if we fail to make payments or breach the license agreement. We also rely on Texas A&M University to maintain the patent for our license to remain active. We cannot guarantee that the patent will remain in force indefinitely, and if the patent expires, our license will terminate. If we lose the SISWR license, it will have a material adverse impact on our business, operations and financial results. We may need to develop intellectual property to protect our products, which will require significant time and expense. We currently own no significant intellectual property related to our planned chitosan products. The process of extracting chitosan is a general, unprotected process and we are unaware of any intellectual property preventing us from developing it. If we develop this intellectual property internally, we will seek to obtain intellectual property protection (whether patents or otherwise) for our technology. This process can be expensive and time-consuming, and there is no certainty of being awarded intellectual property protection. If we fail to adequately develop and protect our intellectual property, its value will diminish, and we may not be able to compete effectively in the market. If we are awarded intellectual property protection for extraction and production technology, we may face actions from third parties claiming we infringe on their intellectual property. Branding and trademark protection will be important for our chitosan marketing plan. We intend to apply for trademarks for one or more of our chitosan products. We cannot be certain that we will be granted the trademarks for which we apply. If we infringe the rights of third parties, we could be prevented from selling products and forced to pay damages and defend against litigation. If our products, methods, processes, and other technologies infringe the proprietary rights of other parties, we could incur substantial costs and we may have to: obtain licenses, which may not be available on commercially reasonable terms, if at all; abandon an infringing product; redesign our products or processes to avoid infringement; stop using the subject matter claimed in the patents held by others; pay damages; and/or defend litigation or administrative proceedings which may be costly whether we win or lose, and which could result in a substantial diversion of our financial and managerial resources and create potential delays. Any of these events could have a material adverse effect on our business, financial condition, and results of operations. Disruptions of information technology systems or data security incidents could result in significant financial, legal, regulatory, business, and reputational harm. We seek to preserve the integrity and confidentiality of our information by maintaining physical security of our premises and physical and electronic security of our information technology systems, but it is possible that these security measures could be breached. We also rely on systems provided by third parties, which may suffer security breaches or incidents. Such security breaches may be inadvertent or due to intentional misconduct or other malfeasance or by human error or technical malfunctions, including those caused by hackers, employees, contractors, or vendors. A breach of our security could compromise our networks, and the information stored therein could be accessed, manipulated, publicly disclosed, lost, or stolen. Any such access, manipulation, disclosure, or loss of information could result in errors in our records, fraudulent use of our financial information, legal claims or proceedings, liability under laws that protect the privacy of personal information, theft of our intellectual property, or damage to our reputation. In addition, our systems could be the subject of denial of service or other interference, which could disrupt our operations and commercial transactions. Any of the foregoing could have a material adverse effect on our business, financial condition, and results of operations. If any of our proprietary technology or information is stolen, misappropriated, or reverse engineered, others could use it to build competing technologies or produce similar products. Employees and third parties, including our collaborators, contractors, and others involved in our business have certain access to our proprietary technology and information. If any of our proprietary technology or information is stolen, misappropriated, or reverse engineered, it could be used by other parties for their own commercial gain. If this were to occur, it would be difficult for us to challenge this type of use, especially in countries with limited intellectual property protection. Any failure to protect our proprietary technology and information could have a material adverse effect on our business, financial condition, and results of operations. As we grow, we may experience difficulties with our enterprise resource planning, or ERP, system. In 2019, we implemented a new ERP system at our Balaton Bay Reef facility that integrates our water reclamation, biofiltration, robotic feed, harvest, and financial analysis processes. The ERP software provides continual precision data that supports improvement and optimization and serves as the information backbone of our chain of custody and traceability for the shrimp, the shrimp exoskeleton material, and our future chitosan. We designed this system to scale up as we commercialize the shrimp production, but there may be unexpected complications or design changes needed as we grow our business. Failure of this ERP software could have a material adverse effect on our business, financial condition, and results of operations. Additional Risks Relating to Our Shrimp Business We have limited experience selling, marketing, or distributing our shrimp and currently lack adequate internal capability to do so. We currently have very limited sales, marketing, and distribution capabilities and have not sold or distributed our products on a commercial scale. To advance our sales, we intend to develop internal sales, marketing, and distribution capabilities to target particular markets for our products. We may make arrangements with third parties to perform some or all of these services for us. We may not be able to establish these capabilities internally or hire marketing, sales, and/or distribution personnel with appropriate expertise to market, sell, and distribute our products. In addition, even if we can identify one or more acceptable collaborators to perform these services for us, we may not be able to enter into any collaborative arrangements on favorable terms, or at all. If we enter into any collaborative arrangements for the marketing, sale, and/or distribution of our products, our expenses may be higher than if we performed some or all of these functions ourselves. In addition, any revenues we receive would depend upon the efforts of our collaborators, which may not be adequate due to lack of attention or resource commitments, management turnover, change of strategic focus, business combinations, their inability to comply with regulatory requirements, or other factors outside of our control. Depending upon the terms of our collaboration, the remedies we have against an under-performing collaborator may be limited. If we were to terminate a collaborative arrangement, it may be difficult or impossible to find a replacement collaborator on acceptable terms or at all. Any failure to build out and maintain effective sales, marketing, and distribution functions, whether internally or externally, could have a material adverse effect on our business, financial condition, and results of operations. We have not determined the demand for our superior shrimp nor confirmed the premium price. Shrimp grown in natural environments are generally subject to diseases and contamination from waste material and other contaminants. We believe we can grow shrimp in a controlled environment with filtered water, reducing or eliminating waste and disease. We expect people to desire our superior shrimp more than shrimp grown in natural environments, as they are subject to less stress than external environments. We have not conducted studies to confirm the supply and demand from a marketing standpoint. It is possible that our superior shrimp will not be accepted in the market, will not be as profitable as anticipated, or will fail entirely. Consumer shrimp is generally considered a commodity, with little or no differentiation beyond price, and is marketed accordingly. We expect consumers will pay a premium price for a differentiated, premium product, but we cannot ensure that our product will be accepted into the market at that price. An inability to sell shrimp at premium prices would likely have a material adverse effect on our business, financial condition, and results of operations. We are reliant on a limited number of key suppliers for shrimp larvae and any interruption in such supply could cause significant production delays and have a material adverse effect on our business operations and financial results. While we have a shrimp hatchery located at our Balaton Bay Reef facility, we are currently utilizing it for limited research and development purposes. We are not operating it to provide larvae for commercial production. Instead, we are currently obtaining our shrimp larvae from outside suppliers. There are a very limited number of these suppliers, some of which are competitors in shrimp production, and we do not have long-term contracts in place to buy larvae for commercial production at Balaton Bay Reef or Madison Bay Harbor. These suppliers could experience significant issues in larvae production due to issues with breeding, disease, or other factors outside of our control. Further, these suppliers may not continue to sell larvae to us at all or on terms that are acceptable. It would take a significant amount of time to scale up our hatchery for commercial use. Any difficulty sourcing shrimp larvae on a timely basis could have a material adverse effect on our business, financial condition, and results of operations. Disease may disrupt our shrimp production and thus affect our exoskeletal molt production. Shrimp are susceptible to disease and disease in any form can disrupt the production of shrimp and the supply of shrimp exoskeleton material. There are nine identified pathogens and countless species of bacteria related to shrimp and water habitat. Our shrimp production system was developed to mitigate the risk of disease and utilizes several modern biosecurity practices and other processes to mitigate disease. Failure of any of these practices or processes might allow disease to enter the system, resulting in a material adverse effect on shrimp production as well as shrimp exoskeleton material production. Food safety events could create negative publicity for our customers and adversely affect sales and operating results. Food safety is a top priority, and we dedicate substantial resources to ensure that our customers will enjoy safe, quality products. However, food safety events, including instances of food-borne illness, could occur in the future. Food safety events with customers, whether or not they involve shrimp, could adversely affect sales by those customers. In addition, customers who purchase our shrimp for their food products could experience negative publicity or experience a significant increase in food costs if there are food safety events. If such customers experience a decline in sales as a result of such food safety event, our results of operations may be adversely affected. There is a risk that contamination of the water or feed in the harbor may interrupt the shrimp growth process, potentially reducing or eliminating the amount of shrimp for customers as well as shrimp exoskeleton material available for chitosan production. Any such situation would likely have a material adverse effect on our business, financial condition, and results of operations. New information or attitudes regarding diet and health or adverse opinions about the health effects of the superior shrimp we distribute could result in changes in consumer eating habits which could materially and adversely affect our business, financial condition, or results of operations. Consumer eating habits may impact our business as a result of changes in attitudes regarding diet and health or new information regarding the health effects of consuming the superior shrimp we plan to distribute. If consumer eating habits change significantly, we may be required to modify or discontinue sales of certain items in our product portfolio, and we may experience higher costs associated with the implementation of those changes. Additionally, changes in consumer eating habits may result in the enactment of laws and regulations that impact the ingredients and nutritional content of our food products or require us to disclose the nutritional content of our food products. Compliance with these laws and regulations, as well as others regarding the ingredients and nutritional content of our superior shrimp, may be costly and time-consuming. We cannot make any assurances regarding our ability to effectively respond to changes in consumer health perceptions and resulting laws or regulations or to adapt our menu offerings to trends in eating habits. If we fail to successfully develop new product offerings and enhance our existing product offerings, our ability to attract new customers and retain existing customers, and our business, financial condition, and operating results, may be materially adversely affected. Our customers have a wide variety of options for purchasing food, including traditional and online grocery stores and restaurants, and consumer tastes and preferences may change from time to time. Our ability to attract new customers, retain existing customers, and increase customer engagement with us will depend in part on our ability to successfully introduce new product offerings and to improve upon and enhance our existing product offerings. This may include, for example, offering different shrimp sizes and different packaging. If our new or enhanced product offerings are unsuccessful, our business and operating results could be materially, adversely affected. Furthermore, new customer demands, tastes or interests, superior competitive offerings, or a deterioration in our product quality or our ability to bring new or enhanced product offerings to market quickly and efficiently could negatively affect the attractiveness of our products and the economics of our business and require us to make substantial changes to and additional investments in our product offerings or business model. Developing and launching new product offerings or enhancements to our existing product offerings involves significant risks and uncertainties, including risks related to the reception of such product offerings by our existing and potential future customers, increases in operational complexity, unanticipated delays or challenges in implementing such offerings or enhancements, increased strain on our operational and internal resources (including an impairment of our ability to accurately forecast demand and related supply), and negative publicity in the event such new or enhanced product offerings are perceived to be unsuccessful. In addition, developing and launching new product offerings and enhancements to our existing product offerings may involve significant upfront capital investments and such investments may not prove to be justified. Any of the foregoing risks and challenges could adversely affect our ability to attract and retain customers and could have a material adverse effect on our business, financial condition, and results of operations. Any failure to adequately store, maintain, and deliver quality perishable foods could materially adversely affect our business, financial condition, and operating results. Our ability to adequately store, maintain, and deliver quality perishable foods is critical to our business. We store food products, which are perishable, and will need to ship them to our customers. Keeping our food products at specific temperatures maintains freshness and enhances food safety. In the event of extended power outages, natural disasters, or other catastrophic occurrences, failures of the systems in our facilities or third-party delivery trucks, failure to use adequate packaging to maintain appropriate temperatures, or other circumstances both within and beyond our control, our inability to store perishable inventory at specific temperatures could result in significant product inventory losses as well as increased risk of food-borne illnesses and other food safety risks. Improper handling or storage of food by a customer without any fault by us could result in food-borne illnesses, which could nonetheless result in negative publicity and harm to our brand and reputation. The occurrence of any of these risks could materially adversely affect our business, financial condition, and operating results. We have numerous competitors that have greater market share than ours. There are many competitors in the market that produce shrimp, including large scale companies in Southeast Asia, India and Ecuador. Many of these competitors are well-established and better capitalized companies than we are. Many of our competitors have advantages we lack, such as established manufacturing and distribution chains, a larger and more experienced work force, established market, existing customer base, and existing purchase contracts. If we are unable to maintain a competitive advantage with respect to our premium brand positioning, our shrimp may never be commercially viable in the market. There may also not be enough demand for shrimp for our product to become successful. Additionally, certain of our competitors may benefit from government support and other incentives that are not available to us. As a result, our competitors may be able to produce shrimp at artificially low prices and compete more aggressively over a longer period than we can. Any of these circumstances could have a material adverse effect on our business, financial condition, and results of operations. We have no executed purchase contracts for our shrimp business. We have a letter of intent, or LOI, with a leading North American food service distributor to buy all of our shrimp production for ten years, but the agreement is non-binding and we may never enter into a binding agreement with this or any other customer. We have no binding long-term agreements and no commitments to sell our shrimp even if we are successful in scaling it and the LOI prohibits us from negotiating such arrangements with any other party (unless the LOI is mutually terminated). Any failure or delay in being able to sell our shrimp at acceptable prices could have a material adverse effect on our business, financial condition, and results of operations. Additional Risks Related to Our Chitosan Segment We have limited experience in producing chitosan. We have limited experience in producing chitosan and have not yet sold any. To date, we have only engaged in pre-production work with respect to chitosan, including analysis of the shrimp exoskeleton material, bench top trials, analysis of the chitosan produced by the bench top trials, and primary and secondary market research. We may never be successful in developing commercial scale chitosan production processes, and any failure or delay in doing so could have a material adverse effect on our business, financial condition, and results of operations. We have limited experience selling, marketing, or distributing our chitosan products and currently lack adequate internal capability to do so. We currently have very limited sales, marketing, and distribution capabilities and have not sold or distributed our chitosan products on a commercial scale. To commercialize our chitosan sales, we may decide to develop internal sales, marketing, and distribution capabilities to target particular markets for our products. We may make arrangements with third parties to perform some or all of these services for us. We may not be able to establish these capabilities internally or hire marketing, sales, and/or distribution personnel with appropriate expertise to market, sell, and distribute our chitosan products. In addition, even if we are able to identify one or more acceptable collaborators to perform these services for us, we may not be able to enter into any collaborative arrangements on favorable terms or at all. If we enter any collaborative arrangements for the marketing, sale, and/or distribution of our chitosan, our expenses may be higher than if we performed some or all of these functions ourselves. In addition, any revenues we receive would depend upon the efforts of our collaborators, which may not be adequate due to lack of attention or resource commitments, management turnover, change of strategic focus, business combinations, their inability to comply with regulatory requirements, or other factors outside of our control. Depending upon the terms of our collaboration, the remedies we have against an under-performing collaborator may be limited. If we were to terminate a collaborative arrangement, it may be difficult or impossible to find a replacement collaborator on acceptable terms, if at all. Any failure to build out and maintain effective sales, marketing, and distribution functions, whether internally or externally, could have a material adverse effect on our business, financial condition, and results of operations. We rely on our shrimp growing operation for our source of chitosan raw materials and any disruption in such growing operations will disrupt our ability to produce chitosan. We rely on our shrimp growing operations for the shrimp exoskeleton material needed to produce chitosan. Any failure, delay, decrease in production, or other problem with our shrimp production generally will have an impact on our ability to obtain the raw materials to develop chitosan. We may need to seek supplemental sources for our raw materials. We plan to obtain all of the shrimp exoskeleton material needed for our chitosan operations from our shrimp producing operations. If our shrimp production were to fail for any reason, we would also lose our supply of shrimp exoskeleton material. If our chitosan segment grows significantly, we may be unable to produce sufficient raw material from our shrimp operations to satisfy our chitosan requirements. If this occurs, we may need to seek an alternative source of raw materials. Since such sources would likely be competitors in the shrimp production business, we may not be able to acquire any raw materials, which would prevent or delay our ability to produce chitosan. Any such circumstance could have a material adverse effect on our business, financial condition, and results of operations. We rely on collection and separation technologies to separate the shrimp exoskeleton material from the other settled solids. We use collection and separation technologies to separate the shrimp exoskeleton material from the other settled solids within the waste stream to systematically remove them from the Tidal Basins. A failure of these collection or separation technologies could lead to delays and disruptions in chitosan production, which could have a material adverse effect on our business, financial condition, and results of operations. We lease specialized machines and parts for creation of our product and have no guarantee that we will be able to lease additional machines needed to scale-up production or to maintain such machines in the future. We lease two specialized, automated machines that de-head, de-vein and de-shell our shrimp to expedite the separation process. Our supply of shrimp exoskeleton material from which we extract chitin to create chitosan is dependent on the proper functioning of these machines. We will need several more machines in order to produce shrimp and chitosan at projected levels. No long-term contract with the manufacturer of the machines is available. The manufacturer may refuse to lease us additional machines, may exclusively license the machine or its technology to another company, or may go out of business. There are other shrimp processing machines in the market, but they are not as effective or efficient as the particular equipment that we use. Without effective and efficient automated machines, de-shelling the shrimp is a lengthy, manual, and more expensive process. An inability to lease or purchase additional machines, or to purchase parts and maintenance for such machines, would delay and potentially prevent our ability to produce shrimp and chitosan and could have a material adverse effect on our business, financial condition, and results of operations. Contamination during the preservation, conversion, or post-conversion process would adversely affect chitosan production. Once the shrimp exoskeleton material necessary for chitosan production has been collected and separated, it is cleaned and dried. If this material was to become damaged or contaminated during the preservation process, it would adversely affect chitosan production. After preservation, this material is transported to a third-party CMO conversion facility where it undergoes chemical processes to convert into chitosan. The preserved raw material may be lost, spoiled, damaged, or contaminated in transportation to the CMO. Once the materials are converted into chitosan, the chitosan may be lost, damaged, or contaminated through the balance of the supply chain, including during packaging at the CMO, warehousing, distribution, and by the end user as a component for a variety of products. Any such circumstances could have a material adverse effect on our business, financial condition, and results of operations. We expect to rely upon one third-party CMO for chitosan production. We plan to use one CMO, Parimer Scientific, for the chitosan production process. This CMO may go out of business, may not have sufficient capacity to convert our raw material, may cease performing chitosan conversion, or may be damaged in a fire or other accident or otherwise be unable to convert our shrimp exoskeleton material into chitosan as expected. Any of these occurrences could have a material adverse effect on the timing and quantity of converting the shrimp exoskeleton material into chitosan, and it will likely be difficult, expensive, and time consuming to find another third-party CMO capable of producing the chitosan products we plan to sell. Any inability to timely find a suitable replacement provider would likely have a material adverse effect on our business, financial condition, and results of operations. We may be unable to produce chitosan in-house in the future. We intend to utilize a CMO, Parimer Scientific, to produce our chitosan products. If we are required or decide to develop a conversion facility and complete some or all of the chitosan extraction in-house, this would require hiring additional staff, including qualified biochemists with experience in chitosan conversion to run our conversion operations. It would also require us to obtain regulatory approvals, purchase additional equipment, and make greater capital investments. We may be unable to collect, separate, and convert our shrimp exoskeleton material into chitosan at a cost point that will make the chitosan competitive in the market. We may need to develop new processes or make other adjustments to produce the tissue and convert it to chitosan at a commercially acceptable price point, and any failure to do so could have a material adverse effect on our business, financial condition, and results of operations. If we are unable to hire additional qualified personnel, it could delay the commercialization of our chitosan business. Over time, we will need to hire additional qualified personnel. Our chitosan product development plans are significantly dependent on our ability to attract and retain highly skilled scientists for chitosan extraction and production, as well as personnel experienced with applicable government regulations. We may not be able to attract or retain qualified employees due to the intense competition for qualified personnel among aquaculture companies, biotechnology companies, universities, research institutions, and other technology or scientific-based businesses, or due to the unavailability of personnel with the qualifications or experience necessary for our business. If we are unable to attract and retain the necessary personnel to accomplish our business objectives, we may experience staffing constraints that could adversely affect our ability to adequately staff our proposed chitosan business segment. Any such issues could have a material adverse effect on our business, financial condition, and results of operations. There is a low barrier of entry for competitors who already grow shrimp. Some of our competitors who currently grow shrimp for food only may decide to produce chitosan with their discarded shrimp exoskeleton material from their current facilities. These competitors could enter the market relatively quickly, as they already produce shrimp and thus have a supply of the raw material. Additional competition could have a material adverse effect on our business, financial condition, and results of operations. We will need to meet quality and purity requirements of our purchasers which are currently unknown. The chitosan we extract will need to meet the quality and purity requirements of our purchasers. Our ability to sell chitosan products is dependent on the quality and purity of the shrimp exoskeleton material. We will not know the quality and purity requirements until we enter contracts with our purchasers. Depending on these requirements, we may need to invest in additional equipment, technology, and staff to meet these requirements. We currently have no executed purchase contracts for our chitosan products. It is difficult, particularly with manufacturers who use chitosan for medical applications, to replace a current supplier of a target manufacturer. We will likely need to seek out manufacturers who do not yet have established relationships with suppliers of chitosan. It may take extensive time to find purchasers and negotiate purchase contracts. The terms of the purchase contracts may not be favorable to the Company as we are new in this market. The purchase contracts may provide for delayed payment terms, which may have a negative impact on our cash flow. Purchasers may default on their obligations to purchase for a variety of reasons. Any of these factors could severely limit our ability to sell our chitosan products on a profitable basis and could have a material adverse effect on our business, financial condition, and results of operations. We may be sued for product liability claims for health care end-products. Our products may be used in medical or health care end-products. Any products, and particularly products used in medical or health care, entail an inherent risk of product liability. We may become involved in product liability claims against our chitosan products directly, or we may become secondarily involved in products liability claims against the end-products of customers using our chitosan products. If we are unable to defend those claims successfully, we may incur substantial liabilities. Even if we prevail, the costs and delays involved in protracted products liability litigation may have an adverse impact on our business. We intend to maintain product liability insurance, but it is possible that insurance will not cover all losses we may incur, and such insurance will likely not compensate us for negative publicity. We expect to use indemnification agreements with our customers and collaborators, but the indemnification agreements may not be sufficient to protect us from all losses should a claim arise. Any such circumstances could have a material adverse effect on our business, financial condition, and results of operations. We have not yet determined the appropriate pricing for our chitosan products. We may need to acquire additional equipment, additional technology, and additional trained technical staff to extract the chitosan at higher grades of purity. We may be unable to extract, process and sell our proposed chitosan products, or to do so at a price point that will make the chitosan competitive in the market. We may need to purchase new or additional production equipment, hire new personnel, or make other adjustments to produce the chitosan products at a commercially acceptable price point. Any inability to do so could have a material adverse effect on our business, financial condition, and results of operations. Based on our review of third-party analysis of our chitosan, we believe we can charge a premium price for it. Targeted third-party pharmaceutical, medical device, and dermatology customers may not pay our target price point. Failure to achieve our target price points for chitosan will have a material adverse effect on our business, financial condition, and results of operations. We may inadvertently depress the price of premium USP-grade chitosan. If we are successful in producing large quantities of premium USP-grade chitosan, we may discover that we inadvertently depress the market price for this product by creating a large supply. If this were to occur it could have a material adverse effect on our business, financial condition, and results of operations. Risks Relating to this Offering and Our Units, Common Stock and Warrants Active trading markets for our common stock and/or warrants may not develop or be sustained. Even if our common stock and warrants are both approved for listing on the Nasdaq Capital Market, active trading markets for our common stock and/or warrants may not develop or be maintained. If active markets for our common stock or warrants are not developed or maintained, it may be difficult for stockholders to sell shares of our common stock and/or warrants. An inactive trading market may impair our ability to raise capital to continue to fund operations by selling shares and may impair our ability to acquire other companies or technologies by using our shares as consideration. The price of our shares of common stock and warrants is likely to be volatile. The share price of publicly traded emerging companies can be highly volatile and subject to wide fluctuations. The prices at which our common stock and warrants underlying the Units are quoted and the prices which investors may realize will be influenced by many factors, some specific to our company and operations and some that may affect the quoted food production, biotechnology or other relevant sectors, or quoted companies generally. These factors could include variations in our operating results and execution of our commercialization plans, publicity regarding the process of obtaining regulatory approval to commercialize our products, divergence in financial results from analysts expectations, changes in earnings estimates by stock market analysts, overall market or sector sentiment, legislative changes in our sector, the performance of our research and development programs, large purchases or sales of our common stock, currency fluctuations, legislative changes in the bioengineering environment, and general economic conditions. Most of these events and factors are outside of our control. Stock markets may experience severe price and volume fluctuations which could adversely affect the market prices for our common stock and warrants. The warrants underlying the Units may not have any value. Each warrant underlying the Units will have an assumed exercise price equal to the offering price per Unit and will be exercisable from the date of issuance until the fifth anniversary of the issue date. The warrants do not confer any rights of common stock ownership on their holders, such as voting rights or the right to receive dividends. In the event our common stock price does not exceed the exercise price of the warrants during the period when the warrants are exercisable, the warrants may not have any value. Since the Warrants are executory contracts, they may have no value in a bankruptcy or reorganization proceeding. In the event a bankruptcy or reorganization proceeding is commenced by or against us, a bankruptcy court may hold that any unexercised warrants are executory contracts that are subject to rejection by us with the approval of the bankruptcy court. As a result, holders of the warrants may, even if we have sufficient funds, not be entitled to receive any consideration for their warrants or may receive an amount less than they would be entitled to if they had exercised their warrants prior to the commencement of any such bankruptcy or reorganization proceeding. Provisions of the warrants underlying the Units offered by this prospectus could discourage an acquisition of us by a third party. Certain provisions of the warrants underlying the Units offered by this prospectus could make it more difficult or expensive for a third party to acquire us. For example, the terms of the warrants provide that the warrants be treated as exercised immediately prior to certain transactions constituting fundamental transactions, which could reduce the value of the consideration payable to other holders of Company securities. Further, in certain circumstances, the holders of the warrants will have the option to require the Company to purchase the warrants from the holders by paying to the holders an amount of cash equal to the Black-Scholes value of the remaining unexercised portion of the warrant on the date of the consummation of such fundamental transactions. These and other provisions of the warrants offered by this prospectus could prevent or deter a third party from acquiring us even where the acquisition could be beneficial to you. If we do not maintain a current and effective prospectus relating to the common stock issuable upon exercise of the warrants, holders will only be able to exercise such warrants on a cashless basis. If we do not maintain a current and effective registration statement relating to the common stock issuable upon exercise of the warrants included as part of the Units at the time that holders wish to exercise such warrants, they will only be able to exercise them on a cashless basis provided that an exemption from registration is available. As a result, the number of shares of common stock that holders will receive upon exercise of the warrants will be fewer than it would have been had such holder exercised his warrant for cash. Further, if an exemption from registration is not available, holders would not be able to exercise on a cashless basis and would only be able to exercise their warrants for cash if a current and effective registration statement relating to the common stock issuable upon exercise of the warrants is available. Under the terms of the underwriting agreement, we have agreed to use our best efforts to meet these conditions and to file and maintain a current and effective registration statement relating to the Common Stock issuable upon exercise of the warrants until the expiration of the warrants. However, we cannot assure you that we will be able to do so. If we are unable to do so, the potential upside of the holder s investment in our Company may be reduced or the warrants may expire worthless. An investor will only be able to exercise his warrant if the issuance of shares of common stock upon such exercise has been registered or qualified or is deemed exempt under the securities laws of the state of residence of the holder of the warrants. No warrants will be exercisable and we will not be obligated to issue shares of common stock unless the shares of common stock issuable upon such exercise has been registered or qualified or deemed to be exempt under the securities laws of the state of residence of the holder of the warrants. if the shares of common stock issuable upon exercise of the warrants are not qualified or exempt from qualification in the jurisdictions in which the holders of the warrants reside, the warrants may be deprived of any value, the market for the warrants may be limited and they may expire worthless if they cannot be sold. The warrants may have an adverse effect on the market price of our common stock and make it more difficult to effect a business combination. We will be issuing warrants to purchase shares of common stock as part of this offering. To the extent we issue shares of common stock to effect a future business combination, the potential for the issuance of a substantial number of additional shares upon exercise of the warrants could make us a less attractive acquisition vehicle in the eyes of a target business. Such warrants, when exercised, will increase the number of issued and outstanding shares of common stock and reduce the value of the shares issued to complete the business combination. Accordingly, the warrants may make it more difficult to effectuate a business combination or increase the cost of acquiring a target business. Additionally, the sale, or even the possibility of sale, of the shares of common stock underlying the warrants could have an adverse effect on the market price for our securities or on our ability to obtain future financing. If and to the extent the warrants are exercised, you may experience dilution to your holdings. The warrants offered hereby designate the state and federal courts sitting in the City of New York, Borough of Manhattan as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by holders of the warrants issued as part of the Unit, which could limit the ability of warrant holders to obtain a favorable judicial forum for disputes with our Company. Our warrants provide that, subject to applicable law, (i) any action, proceeding or claim against us arising out of or relating in any way to the warrant, including under the Securities Act, will be brought and enforced in the state and federal courts sitting in the City of New York, Borough of Manhattan, of the State of New York, and (ii) that we irrevocably submit to such jurisdiction, which jurisdiction shall be the exclusive forum for any such action, proceeding or claim. We will waive any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum. Notwithstanding the foregoing, these provisions of the warrant will not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim for which the federal district courts of the United States of America are the sole and exclusive forum. Any person or entity purchasing or otherwise acquiring any interest in any of our warrants shall be deemed to have notice of and to have consented to the forum provisions in our warrant. If any action, the subject matter of which is within the scope of the forum provisions of the warrant, is filed in a court other than the state and federal courts sitting in the City of New York, Borough of Manhattan, of the State of New York (a foreign action ) in the name of any holder of our warrants, such holder shall be deemed to have consented to: (x) the personal jurisdiction of the state and federal courts located in the State of New York, Borough of Manhattan, in connection with any action brought in any such court to enforce the forum provisions (an enforcement action ), and (y) having service of process made upon such warrant holder in any such enforcement action by service upon such warrant holder s counsel in the foreign action as agent for such warrant holder. This choice-of-forum provision may limit a warrant holder s ability to bring a claim in a judicial forum that it finds favorable for disputes with our Company, which may discourage such lawsuits. Alternatively, if a court were to find this provision of our warrant inapplicable or unenforceable with respect to one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could materially and adversely affect our business, financial condition and results of operations and result in a diversion of the time and resources of our management and Board of Directors. Shareholders must rely on stock appreciation for any return on their investment because we do not anticipate paying cash dividends in the foreseeable future. We have never declared or paid cash dividends on our common stock. We do not anticipate paying cash dividends in the foreseeable future and intend to retain all our future earnings, if any, to finance the operations, development, and growth of our business. There can be no assurance that we will have sufficient surplus under Delaware law to be able to pay any dividends at any time in the future. Absent payment of dividends, you must rely on appreciation of the price of our common stock for any return, which may never occur. You may also have to sell some or all your shares of our common stock to generate cash flow from your investment. If securities or industry analysts do not publish research or reports, or publish inaccurate or unfavorable research or reports about our business, our share price and trading volume could decline. The United States trading market for our shares of common stock partially depends on the research and reports that securities or industry analysts publish about us or our business. We do not have any control over these analysis reports. If we obtain securities or industry analyst coverage, and one or more of the analysts who covers us downgrades our shares of common stock, changes their opinion of our shares, or publishes inaccurate or unfavorable research about our business, our share price will likely decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, demand for our shares of common stock could decrease, and we could lose visibility in the financial markets, which could cause our share price and trading volume to decline. We are an emerging growth company, and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies will make our shares of common stock less attractive to investors. We are an emerging growth company, as defined in Section 2(a) of the Securities Act. For as long as we continue to be an emerging growth company, we may take advantage of exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including the auditor attestation requirements in the assessment of our internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act, compliance with any new requirements adopted by the Public Company Accounting Oversight Board, or PCAOB, disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and the requirements of holding advisory say-on-pay votes on executive compensation and shareholder advisory votes on golden parachute compensation not previously approved. Under the JOBS Act, we will remain an emerging growth company until the earliest of (1) the last day of the fiscal year in which we have more than $1.07 billion in annual revenue; (2) the date we qualify as a large accelerated filer, with at least $700 million of equity securities held by non-affiliates; (3) the issuance, in any three-year period, by our company of more than $1 billion in non-convertible debt securities; and (4) the last day of the fiscal year following the fifth anniversary of the date of the first sale of our common stock pursuant to an effective registration statement filed under the Securities Act. We cannot predict if investors will find our shares of common stock less attractive because we may rely on these exemptions. If some investors find our shares of common stock less attractive, the result may be lower trading volume and higher price volatility. Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have elected to avail ourselves of this exemption from new or revised accounting standards and, therefore, will not be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies. We will be a controlled company within the meaning of the Nasdaq rules following the completion of this offering and, as a result, will qualify for exemptions from certain corporate governance requirements. If we decide to rely on such exemptions, you may not have the same protections afforded to stockholders of companies that are subject to such requirements. Following the completion of this offering, Ralco Nutrition, Inc., or Ralco, and RNI Aquaculture, LLC, or RNI, together with two of our directors, Jon and Brian Knochenmus, will beneficially own shares representing approximately 53.1% of our capital stock based on shares of common stock outstanding. Jon and Brian Knochenmus, father and son, hold certain voting rights of Ralco, all voting rights of RNI, and are directors and/or officers of such entities. As a group, Ralco, RNI and Jon and Brian Knochenmus currently hold, and following the offering, will continue to control a majority of the voting power of shares eligible to vote in the election of our directors. Under these rules, a company of which more than 50% of the voting power is held by an individual, group or another company is a controlled company and may elect, and we have to date so elected, not to comply with certain corporate governance requirements including: the requirement that a majority of the board of directors consist of independent directors; the requirement that we have a nominating/corporate governance committee that is composed entirely of independent directors; and the requirement that we have a compensation committee that is composed entirely of independent directors. Notwithstanding the availability of these exemptions, our current intent is not to rely on them and instead to comply voluntarily with all corporate governance requirements with respect to our Board under applicable Nasdaq rules. However, in the future we may decide to rely on one or all of the exemptions as a controlled company, and if we do, you will not have the same protections afforded to stockholders of companies that are subject to all of the Nasdaq corporate governance requirements. If we fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results or prevent fraud. Effective internal controls over financial reporting are necessary for us to provide reliable financial reports and, together with adequate disclosure controls and procedures, are designed to prevent fraud. Any failure to implement required new or improved controls, or difficulties encountered in their implementation, could cause us to fail to meet our reporting obligations. In addition, any testing conducted in connection with Section 404 of the Sarbanes-Oxley Act, or any subsequent testing by our independent registered public accounting firm, may reveal deficiencies in our internal controls over financial reporting that are deemed to be material weaknesses, that may require prospective or retroactive changes to our financial statements, or identify other areas for further attention or improvement. Ineffective internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our common stock. If you purchase shares of our common stock and warrants in this Offering, you will experience substantial and immediate dilution. If you purchase shares of our common stock and warrants in this Offering, you will experience substantial and immediate dilution in the pro forma net tangible book value per share, based on the public offering price of $10.00 per Unit, which is the midpoint of the price range set forth on the cover of this prospectus, because the price that you pay will be substantially greater than the pro forma net tangible book value per share of the common stock that you acquire. This dilution is due in large part to the fact that our earlier investors paid substantially less than the public offering price when they purchased their shares of our capital stock. You will experience additional dilution upon exercise of the warrants issued as part of the Units offered hereby and any warrant or option to purchase common stock under our equity incentive plans, vesting of restricted stock units issued to our employees, additional issuances of restricted stock to our employees under our equity incentive plans, or if we otherwise issue additional shares of our common stock. For a further description of the dilution that you will experience immediately after this Offering, see the section of the prospectus titled Dilution. We may issue preferred stock with terms that could further dilute the voting power or reduce the value of our common stock. While we have no specific plan to issue preferred stock, our certificate of incorporation authorizes us to issue, without the approval of our shareholders, one or more series of preferred stock having such designation, relative powers, preferences (including preferences over our common stock respecting dividends and distributions), voting rights, terms of conversion or redemption, and other relative, participating, optional, or other special rights, if any, of the shares of each such series of preferred stock and any qualifications, limitations, or restrictions thereof, as our board of directors may determine. If we issue equity or convertible debt securities to raise additional funds, our existing stockholders may experience dilution, the value of their common stock may be reduced, and the new equity or debt securities may have rights, preferences, and privileges senior to those of our existing stockholders. For example, the repurchase or redemption rights or liquidation preferences we could assign to holders of preferred stock could affect the residual value of the common stock. The financial reporting obligations of being a public company in the United States are expensive, time consuming and place significant additional demands on our management. The obligations of being a public company in the United States place additional demands on our management and require significant expenditures, including costs resulting from public company reporting obligations under the Securities Exchange Act of 1934, as amended, or Exchange Act, the rules and regulations regarding corporate governance practices, including those under the Sarbanes-Oxley Act and the Dodd Frank Wall Street Reform and Consumer Protection Act, and the listing requirements for the Nasdaq Capital Market. Our management and other personnel devote substantial time to ensure that we comply with all these requirements. Despite reforms made possible by the JOBS Act, the reporting requirements, rules, and regulations will increase our legal and financial compliance costs and will make some activities more time consuming and costly, particularly if we were no longer to qualify as an emerging growth company. Any changes that we make to comply with these obligations may not be sufficient to allow us to satisfy our obligations as a public company on a timely basis, or at all. These rules and regulations make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. These factors also could make it more difficult for us to attract and retain qualified persons to serve on our board of directors, particularly to serve on our Audit Committee and Compensation Committee, or as executive officers. There can be no assurance that we will be able to comply with the continued listing standards of the Nasdaq Capital Market. Even if our common stock is approved for listing on the Nasdaq Capital Market, we cannot assure you that we will continue to be able to comply with the standards necessary to maintain a listing of our common stock on the Nasdaq Capital Market. Our failure to meet the continuing listing requirements may result in our common stock being delisted from the Nasdaq Capital Market. Our management will have broad discretion over the use of the proceeds we receive in this Offering and might not apply the proceeds in ways that increase the value of your investment. Our management will have broad discretion to use the net proceeds we receive from this offering, and you will be relying on the judgment of our management regarding the application of these proceeds. Our management might not apply the net proceeds that we receive from this Offering in ways that increase the value of your investment. We currently intend to use the net proceeds of this offering for: (i) continued research, development, and production activities at Balaton Bay Reef, including working capital and operational costs associated with operating Balaton Bay Reef ; (ii) the development of our chitosan and chitosan derivative business, as well as the costs associated with obtaining FDA registration as a supplier; (iii) engineering and development work related to the planning and construction of Madison Bay Harbor; and (iv) other general corporate purposes, including investing further in our sales, marketing and research and development efforts, and the payment of anticipated general and administrative expenses. Until we use the net proceeds that we receive from this offering, we plan to invest the proceeds, and these investments may not yield a favorable rate of return. If we do not invest or apply the net proceeds we receive from this offering in ways that enhance stockholder value, we may fail to achieve expected financial results, which could cause our stock price to decline. Provisions in our corporate documents and Delaware law could delay, defer, or prevent a change in control of the Company, even if that change may be considered beneficial by some of our shareholders. The existence of some provisions in our certificate of incorporation, our bylaws or Delaware law could delay, defer, or prevent a change in control of the Company that a shareholder may consider favorable. These provisions include: providing that the number of members of our board is limited to a range fixed by our bylaws; establishing advance notice requirements for nominations of candidates for election to our board of directors or for proposing matters that can be acted on by shareholders at shareholder meetings; and authorizing the issuance of blank check preferred stock, which could be authorized by our board of directors to issue securities with voting rights and thwart a takeover attempt. As a Delaware corporation, we are also subject to provisions of Delaware law, including Section 203 of the General Corporation Law of the State of Delaware. Section 203 prevents some shareholders holding more than 15% of our voting stock from engaging in certain business combinations with us unless the business combination or the transaction that resulted in the shareholder becoming a 15% or greater holder was approved in advance by our board of directors, results in the shareholder holding more than 85% of our voting stock (subject to certain restrictions), or is approved at an annual or special meeting of shareholders by the holders of at least 66 2/3% of our voting stock not held by the shareholder engaging in the transaction. Any provision of our certificate of incorporation, our bylaws or Delaware law that has the effect of delaying or deterring a change in control could limit the opportunity for our shareholders to receive a premium for their shares of our common stock and affect the price that some investors are willing to pay for our common stock. Our second amended and restated certificate of incorporation will provide that the Court of Chancery of the State of Delaware will be the exclusive forum for substantially all disputes between us and our stockholders, which could limit our stockholders ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees. Our second amended and restated certificate of incorporation that will become effective upon the completion of this offering provides that the Court of Chancery of the State of Delaware (or, if the Court of Chancery does not have jurisdiction, the United State District Court for the District of Delaware) is the exclusive forum, to the fullest extent permitted by law, for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty or other wrongdoing by any of our directors, officers, employees or agents to us or our stockholders, (iii) any action asserting a claim arising pursuant to any provision of the DGCL or our second amended and restated certificate of incorporation or amended and restated bylaws or (iv) any action asserting a claim governed by the internal affairs doctrine, except, in each case, (A) any claim as to which such court determines that there is an indispensable party not subject to the jurisdiction of such court (and the indispensable party does not consent to the personal jurisdiction of such court within 10 days following such determination), (B) which is vested in the exclusive jurisdiction of a court or forum other than such court, or (C) for which such court does not have subject matter jurisdiction, in all cases subject to the courts having jurisdiction over indispensable parties named as defendants. This provision may limit a stockholder s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees, which may discourage such lawsuits against us and our directors, officers and other employees. For example, stockholders who do bring a claim in the Court of Chancery could face additional litigations costs in pursuing any such claim, particularly if they do not reside in or near the State of Delaware. The Court of Chancery may also reach different judgments or results than would other courts, including courts where a stockholder considering an action may be located or would otherwise choose to bring the action, and such judgments or results may be more favorable to us than to our stockholders. The enforceability of similar choice of forum provisions in other companies certificates of incorporation has been challenged in legal proceedings, and it is possible that, in connection with any applicable action brought against us, a court could find the choice of forum provisions contained in our second amended and restated certificate of incorporation to be inapplicable or unenforceable in such action. Alternatively, if a court were to find the choice of forum provision contained in our second amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions. Our exclusive forum provision will not apply to actions arising under the Securities Act or Exchange Act. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder, and while Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts, our second amended and restated certificate of incorporation and amended and restated bylaws will provide that, unless we consent in writing to the selection of an alternative forum, the U.S. federal district courts will be the exclusive forum for the resolution of any actions or proceedings asserting claims arising under the Securities Act. While the Delaware Supreme Court has upheld the validity of similar provisions under the DGCL, there is uncertainty as to whether a court in another state would enforce such a forum selection provision. Our exclusive forum provision will not relieve us of our duties to comply with the federal securities laws and the rules and regulations thereunder, and our stockholders cannot waive, and will not be deemed to have waived, our compliance with these laws, rules and regulations. Any person or entity purchasing or otherwise acquiring any interest in shares of capital stock of the Company will be deemed to have notice of and consented to the forum provisions in our amended and restated certificate of incorporation. Certain members of management and our Board of Directors hold stock in the Company, and as a result may face actual or potential conflicts of interest. The management and directors of the Company own common stock in the Company and will still own common stock of the Company after the Offering is completed. This ownership overlap could create, or appear to create, potential conflicts of interest when Company management and directors face decisions. SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This prospectus, particularly the sections of this prospectus titled Prospectus Summary, Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations, and Business, contains forward-looking statements. All statements other than present and historical facts and conditions contained in this prospectus, including statements regarding our future results of operations and financial positions, business strategy, plans, and our objectives for future operations, are forward-looking statements. When used in this prospectus, the words anticipate, believe, can, could, estimate, expect, intend, is designed to, may, might, plan, potential, predict, objective, should, or the negative of these and similar expressions identify forward-looking statements. These forward-looking statements include statements that are not historical facts, including statements regarding management s expectations for future financial and operational performance and operating and capital expenditures, expected growth, and business outlook; the nature of and progress toward our commercialization plan; the future introduction of our products to customers; required regulatory approvals and the progress toward such approvals; the volume of shrimp and or molt tissues that we may be able to produce; the timeline for our production of saleable shrimp and chitosan; the expected advantages of indoor shallow water systems over pond-based, recirculating aquaculture systems, or RAS, and other aquaculture systems; the validity and impact of legal actions; and the construction of our Harbors; and the establishment of a larger-scale grow-out facility. We have based these forward-looking statements on our current expectations, assumptions, estimates, and projections. While we believe these expectations, assumptions, estimates, and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks, uncertainties, and other factors, many of which are outside of our control, which could cause our actual results, performance, or achievements to differ materially from any results, performance, or achievements expressed or implied by such forward-looking statements. Forward-looking statements in this prospectus include, but are not limited to, statements about: the anticipated benefits and characteristics of our shrimp and chitosan products; the growth of the size of the shrimp and chitosan markets in the United States; the implementation and likelihood of achieving the business plan, future revenue, and operating results; our plans for and the timing of the development of new Harbors and the output of those Harbors; developments concerning our research projects; our expectations regarding our ability to successfully enter new markets or develop additional products; our competitive position and developments and projections relating to our competitors and our industry; expectations regarding anticipated operating results; our estimates regarding expenses, future revenue, capital requirements, needs for additional financing, and ability to raise additional capital to finance our activities; our ability to protect our intellectual property and other proprietary rights and technologies; the impact of and our ability to adapt to changes in laws or regulations and policies; the ability to secure any necessary regulatory approvals to commercialize any products; the rate and degree of market acceptance of any our products; our ability to retain and recruit key personnel; the success of any of our future acquisitions or investments; the initiation of commercial-scale production of chitosan and chitosan derivatives; our ability to secure a CMO that is FDA-registered and the expected results of our initial trials including our expectation that they will produce chitosan and chitosan derivatives that meet our specifications utilizing the required GMP; our ability to meet the reference standards of USP-NF for chitosan and chitosan derivates and to market and sell such products to the biomedical, pharmaceutical, dermatology and high-end consumer cosmetic markets; the anticipated construction of our Madison Bay Harbor facility and its capacity; the production capacity of our Balaton Bay Reef pilot construction facility; You should refer to the section titled Risk Factors and elsewhere in this prospectus for a discussion of important factors that may cause our actual results to differ materially from those expressed or implied by our forward-looking statements. You should read this prospectus and the documents that we reference in this prospectus and have filed as exhibits to the registration statement, of which this prospectus is a part, completely and with the understanding that our actual future results may be materially different from what we expect. These forward-looking statements speak only as of the date of this prospectus. Except as required by law, we undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. the optimization of the ERP system for deployment to manage the larger production of our future Madison Bay Harbor and any additional Harbors we may construct in the future; the availability of our shrimp through food service distribution in fine dining, premium retail, as well as consumer direct with third-party fulfilment; the ability to use waste streams as an ingredient in terrestrial animal feed; shrimp growth rates, survival rates, and stocking rates, to operate seasonless continuous production at scale; our ability to protect and defend our intellectual property rights related to the Tidal Basin Technology platform the ability of our team to accelerate growth and achieve commercial success; our continued improvements in the shrimp density and size, stocking rate, and survival rate, including the shrimp exoskeleton material; our ability to protect and enhance our proprietary technologies, inventions and improvements, including seeking, maintaining and defending patent rights, whether developed internally or licensed from third parties; and our expectations regarding the time during which we will be an emerging growth company under the JOBS Act. We caution you that the foregoing list may not contain all of the risks to which the forward-looking statements made in this prospectus are subject. We may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements. Actual results or events could differ materially from the plans, intentions, and expectations disclosed in the forward-looking statements we make. We have included important factors in the cautionary statements included in this prospectus, particularly in the section titled Risk Factors, that could cause actual results or events to differ materially from the forward-looking statements that we make. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures, or investments that we may make. These forward-looking statements are made only as of the date of this prospectus. We do not undertake and specifically decline any obligation to update any such statements or to publicly announce the results of any revisions to any such statements to reflect future events or developments unless required by federal securities law. New risks emerge from time to time, and it is not possible for us to predict all such risks. MARKET, INDUSTRY AND OTHER DATA This prospectus includes statistical and other industry and market data that we obtained from industry publications and research, surveys and studies conducted by third parties, including the National Ocean Service s Oceanic and Atmospheric Administration (NAOO), the Global Aquaculture Alliance (GAA), the United Nation s Food and Agriculture Organization (FAO), Research & Markets, the United States Department of Agriculture (USDA), USDA s Foreign Agricultural Service, the National Fisheries Institute, Global Outlook for Aquaculture Leadership (GOAL) Surveys, Informational Resources, Inc (IRI), Future Market Insights, the United States Department of Commerce, the Journal of Chitin and Chitosan Science, Urner Barry, and Nielsen Homescan Data. Industry publications and third-party research, surveys, and studies generally indicate that their information has been obtained from sources believed to be reliable. While we believe that the third-party sources are reliable, and the conclusions contained in the publications are reasonable, such information is inherently imprecise. Projections, assumptions, and estimates of our future performance and the future performance of the industry in which we operate is subject to a high degree of uncertainty and risks due to a high variety of factors, including those included in the section of this prospectus titled Risk Factors. These and other factors could cause results to differ materially from those expressed in the estimates made by third parties and by us. USE OF PROCEEDS The net proceeds from the sale of shares of our Units that we are selling in this offering will be approximately $12.5 million, based upon the public offering price of $10.00, which is the midpoint of the price range set forth on the cover page of this prospectus, consisting of $9.99 per share of common stock and $0.01 for each accompanying warrant, after deducting underwriting discounts and commissions and estimated offering expenses payable by us and assuming no exercise of the warrants. We will only receive additional proceeds from the exercise of the warrants issuable in connection with this offering if such warrants are exercised in exchange for cash at their assumed exercise price of $10.00 based on an assumed initial public offering price of $10.00 per Unit. If the underwriters option to purchase additional shares and warrants from us is exercised in full, our net proceeds would be approximately $12.5 million, based on the same public offering price, after deducting underwriting discounts and commissions and estimated offering expenses payable by us. Each $1.00 increase (decrease) in the assumed initial public offering price of $10.00 per Unit, which is the midpoint of the price range set forth on the cover page of this prospectus, would increase (decrease) the net proceeds to us from this offering by approximately $1.4 million, assuming that the number of units offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. Similarly, each increase (decrease) of 100,000 Units offered by us, as set forth on the cover of this prospectus, would increase (decrease) the net proceeds to us by approximately $0.93 million, assuming that the assumed initial public offering price of $10.00 per Unit, which is the midpoint of the price range set forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. We anticipate that we will use the net proceeds we receive from this offering, including any net proceeds we receive from the exercise of the underwriters option to acquire additional shares of common stock in this offering for the following purposes: approximately $4 million to continue research, development, and production activities at Balaton Bay Reef, including working capital and operational costs associated with operating Balaton Bay Reef; approximately $1 million for the development of the chitosan and chitosan derivative business, as well as the costs associated with obtaining FDA registration as a supplier; approximately $5 million for engineering and development work related to the planning and construction of Madison Bay Harbor; and the balance of the funds for other general corporate purposes, including investing further in our sales and marketing and research and development efforts and payment of anticipated general and administrative expenses. These projects will allow us to continue research and development at Balaton Bay Reef and allow us to develop and enter the chitosan business prior to the completion of the construction of Madison Bay Harbor. If our operational and capital requirements are higher than we anticipate, we may need to seek additional sources of capital. In addition, we are planning to raise additional sources of equity and debt capital to complete the construction and commence operations of Madison Bay Harbor. We may use a portion of the net proceeds we receive for the acquisition of businesses, technologies, or other assets that we believe are complementary to our own, although we have no agreements, commitments, or understandings with respect to any such transaction. The amount of what, and timing of when, we actually spend for these purposes may vary significantly and will depend on a number of factors, including our future revenue and expenses and the other factors described in the section of this prospectus captioned Risk Factors. Accordingly, our management will have broad discretion in applying a portion of the net proceeds we receive from this offering. Pending these uses, we intend to invest the remaining net proceeds in high quality, investment-grade instruments. DIVIDEND POLICY We have never declared or paid any cash dividends on our common stock. We currently intend to retain earnings, if any, to finance the growth and development of our business. We do not expect to pay any cash dividends on our common stock in the foreseeable future. Payment of future dividends, if any, will be at the discretion of our board of directors and will depend on our financial condition, results of operations, capital requirements, restrictions contained in current or future financing instruments, provisions of applicable law, and other factors the board of directors deems relevant. CAPITALIZATION The following table sets forth our cash and capitalization as of September 30, 2021: on an actual basis; on a pro forma basis giving effect to: (1) the exchange of the one share of outstanding Series X Preferred Stock for one share of common stock as described in the section entitled Description of Securities Series X Preferred Stock, and (2) the conversion of all of our unsecured convertible promissory notes into shares of common stock as described in the section entitled Description of Securities Unsecured Convertible Promissory Notes, using an assumed initial public offering price of $10.00 per share, which is the midpoint of the price range set forth on the cover page of this prospectus, and a closing date of February 11, 2022; and on an as-adjusted basis to reflect our receipt of the net proceeds from our sale of 1,500,000 Units in this offering at the public offering price of $10.00 per Unit, which is the midpoint of the price range set forth on the cover page of this prospectus, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. You should read this table together with the section of this prospectus titled Management s Discussion and Analysis of Financial Condition and Results of Operations and our financial statements and the related notes thereto appearing elsewhere in this prospectus. As of September 30, 2021 Actual ($) Pro Forma (Note Conversion) ($) Pro Forma As Adjusted($) (in thousands, except for share and per share data; unaudited) Cash, cash equivalents and marketable securities 6,265 6,265 18,727 Total liabilities 16,891 13,441 13,441 Equity Preferred stock, $0.001 par value, 1 share authorized, 1 share issued and outstanding - - - Common stock, $0.001 par value, 49,999,999 shares authorized, 12,085,807 shares issued and outstanding 12 12 14 Additional paid-in capital 51,405 54,916 69,915 Accumulated deficit (41,472 ) (41,534 ) (41,534 ) Total stockholders equity 9,945 13,395 28,395 Total Capitalization 26,836 26,836 41,836 Each $1.00 increase (decrease) in the assumed initial public offering price of $10.00 per Unit, the midpoint of the price range set forth on the cover page of this prospectus, would increase (decrease) each of cash and cash equivalents, additional paid-in capital, total stockholders equity and total capitalization by approximately $1.4 million, assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. We may also increase or decrease the number of shares we are offering. Each increase (decrease) of 100,000 Units offered by us would increase (decrease) each of cash and cash equivalents, additional paid-in capital, total stockholders equity and total capitalization by approximately $0.93 million, assuming that the assumed initial public offering price, the midpoint of the price range set forth on the cover page of this prospectus, remains the same, and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. The pro forma as adjusted information discussed above is illustrative only and will adjust based on the actual initial public offering price and other terms of this offering determined at pricing. The number of shares of our common stock issued and outstanding as set forth in the table above excludes: An aggregate of 662,434 shares of common stock issuable upon the exercise of stock options outstanding as of September 30, 2021 under our 2017 Equity Incentive Plan (the 2017 Plan ) or 2019 Equity Incentive Plan, which we plan to amend and restate prior to completion of this offering (the 2019 Plan ), with a weighted-average exercise price of $9.45 per share; shares of common stock issuable upon the exercise of warrants outstanding as of September 30, 2021, with a weighted-average exercise price of $12.88 and shares underlying warrants to be issued in connection with conversion of our convertible promissory notes into Units as described in the section entitled Description of Securities Unsecured Convertible Promissory Notes; and 947,500 shares of common stock that remain available for issuance under our 2019 Plan as of September 30, 2021. DILUTION If you invest in our common stock and warrants in this offering, your ownership interest will be diluted to the extent of the difference between the public offering price per share of the common stock that is part of each Unit and the as-adjusted net tangible book value per share of our common stock immediately after this offering. Net tangible book value dilution per share to new investors represents the difference between the amount per share paid by purchasers of shares of common stock in this offering and the as-adjusted net tangible book value per share of common stock immediately after completion of this offering. Net tangible book value per share is determined by dividing our total tangible assets, less our total liabilities, by the number of shares of common stock outstanding. Our historical net tangible book value as of September 30, 2021, was $9.9 million, or $0.82 per share. Our pro forma net tangible book value as of September 30, 2021 was $13.3 million, or $1.07 per share of our common stock. Pro forma net tangible book value represents the amount of our total tangible assets less our total liabilities after giving effect: (1) the exchange of the one share of outstanding Series X Preferred Stock for one share of common stock as described in the section entitled Description of Securities Series X Preferred Stock, and (2) the conversion of our unsecured convertible promissory notes into shares of common stock as described in the section entitled Description of Securities Unsecured Convertible Promissory Notes, using an assumed initial public offering price of $10.00 per share (the per Unit offering price and attributing no value to the warrants included in the Units), which is the midpoint of the price range set forth on the cover page of this prospectus, and a closing date of February 11, 2022. Pro forma net tangible book value (deficit) per share is our pro forma net tangible book value (deficit) divided by the number of shares of our common stock deemed to be outstanding as of September 30, 2021. After giving effect to the issuance and sale of Units in this offering at an assumed initial public offering price of $10.00 per share (the per Unit offering price and attributing no value to the warrants included in the Units), which is the midpoint of the price range set forth on the cover page of this prospectus, and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us, our pro forma as adjusted net tangible book value as of September 30, 2021 would have been $25.8 million, or $1.85 per share. This represents an immediate increase in pro forma as adjusted net tangible book value of $0.78 per share to our existing stockholders and an immediate dilution of $8.15 per share to new investors purchasing Units in this offering. We determine dilution per share to new investors by subtracting our pro forma as adjusted net tangible book value per share after this offering from the assumed public offering price per share paid by new investors in this offering. Public offering price per Unit $ 10.00 Historical net tangible book value per share as of September 30, 2021 $ 0.82 Increase in historical net tangible book deficit per share attributable to pro forma transactions and other adjustments described above $ 0.25 Pro forma net tangible book deficit per share as of September 30, 2021 $ 1.07 Increase in net tangible book value per share attributable to new investors in this offering $ 0.78 Pro forma as adjusted net tangible book value per share after this offering $ 1.85 Dilution per share to new investors in this offering $ 8.15 Each $1.00 increase (decrease) in the assumed initial public offering price of $10.00 (which is the midpoint of the price range set forth on the cover page of this prospectus) would increase (decrease) our pro forma as adjusted net tangible book value per share after this offering by $0.10 per share and the dilution per share to new investors participating in this offering by $0.91 per share, assuming that the number of shares of common stock offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us (and in all cases, attributing all value to the shares of common stock included in the Units and no value to the warrants). Notwithstanding the foregoing sensitivity analysis, $15,000,000 in gross proceeds from the offering is required to comply with Nasdaq listing standards. Accordingly, in the case of a $1.00 decrease to the offering price, we will be required to increase the offering size to 1,666,667 Units (1,916,667 shares and/or warrants after full exercise of the underwriter s option to purchase additional shares of common stock). As such, a decrease to pro forma as adjusted net tangible book value and dilution to new investors is not expected to occur. Each increase (decrease) of 100,000 in the number of Units offered by us, as set forth on the cover page of this prospectus, would increase (decrease) the pro forma as adjusted net tangible book value per share after this offering by $0.05 per share and increase (decrease) the dilution per share to new investors participating in this offering by $0.05 per share, assuming that the assumed initial public offering price remains the same and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us. As noted above, however, a decrease of 100,000 in the number of Units offered by us could, depending on the offering price, result in offering proceeds insufficient for Nasdaq listing standards. As such, the foregoing decrease to pro forma as adjusted net tangible book value and dilution to new investors may not occur. If the underwriters exercise their option to purchase an additional 225,000 shares in full, the as-adjusted net tangible book value per share of our common stock immediately after this offering would be $2.00 per share, and the dilution in net tangible book value per share to new investors in this offering would be $8.00 per share, based on the public offering price of $10.00 per Unit and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. The following table shows, as of September 30, 2021, on a pro forma as adjusted basis as described above, the number of shares of common stock purchased from us, the total consideration paid to us and the average price per share paid, or to be paid, by existing stockholders and by new investors purchasing Units in this offering at the assumed initial public offering price of $10.00 per Unit, which is the midpoint of the price range set forth on the cover page of this prospectus, before deducting underwriting discounts and commissions and estimated offering expenses payable by us: Shares Purchased Total Consideration Number Percent Amount Percent Average Price Per Share Existing stockholders before this offering 12,470,855 89.3 % $ 54,866,617 78.5 % $ 4.40 New investors participating in this offering 1,500,000 10.7 % $ 15,000,000 21.5 % $ 10.00 Total 13,970,855 100 % $ 69,866,617 100 % $ 5.00 Each $1.00 increase (decrease) in the assumed initial public offering price of $10.00 per Unit (which is the midpoint of the price range set forth on the cover page of this prospectus), would increase (decrease) the total consideration paid by new investors participating in this offering and total consideration paid by all stockholders by approximately $1.5 million, assuming that the number of Units offered by us (which equals the number of shares of common stock offered), as set forth on the cover page of this prospectus, remains the same and before deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us. The above table assumes no exercise of the underwriter s option to purchase additional shares of common stock and/or warrants to purchase shares of common stock. If the underwriter exercises its option to purchase additional shares of common stock in full, our existing stockholders before this offering would own 87.9% and our new investors participating in this offering would own 12.1% of the total number of shares of our common stock outstanding immediately after the completion of this offering (in each case excluding shares of common stock that would be issuable upon exercise of warrants purchased as part of such underwriter s option). Additionally, the consideration paid to us by existing stockholders before this offering would be approximately $54.9 million, or approximately 76.1% of the total consideration, and the consideration paid to us by new investors participating in this offering would be approximately $17.3 million, or approximately 23.9% of the total consideration. The foregoing discussion and tables are based on (other than the historical net tangible book value calculation) 12,085,807 shares of common stock outstanding as of September 30, 2021, and effect to the pro forma transactions described above, assuming all value of the Units is attributed to the shares of common stock included in the Units (and no value is attributed to the warrants included in the Units), and excludes: An aggregate of 662,434 shares of common stock issuable upon the exercise of stock options outstanding as of September 30, 2021 under our 2017 Equity Incentive Plan (the 2017 Plan ) or our 2019 Equity Incentive Plan, which we plan to amend and restate prior to completion of this offering (the 2019 Plan ), with a weighted-average exercise price of $9.45 per share; 737,452 shares of common stock issuable upon the exercise of warrants outstanding as of September 30, 2021, with a weighted-average exercise price of $12.88 and shares underlying warrants to be issued in connection with conversion of our convertible promissory notes into Units as described in the section entitled Description of Securities Unsecured Convertible Promissory Notes; and 1,500,000 shares of common stock issuable upon exercise of the warrants sold as part of this offering (or 1,725,000 if the underwriters exercise in full their option to purchase up to 225,000 additional shares of common stock and/or warrants); 947,500 shares of common stock that remain available for issuance under our 2019 Plan as of September 30, 2021. To the extent that outstanding options or warrants are exercised, you will experience further dilution. In addition, we may choose to raise additional capital due to market conditions or strategic considerations even if we believe we have sufficient funds for our current or future operating plans. To the extent that additional capital is raised through the sale of equity or convertible debt securities, the issuance of these securities may result in further dilution to our stockholders. SELECTED FINANCIAL DATA The following table sets forth our selected financial data. We have derived the statement of operations data for the years ended December 31, 2020, and 2019 and the balance sheet data as of December 31, 2020 and 2019 from our audited financial statements appearing elsewhere in this prospectus. The statement of operations data for the nine months ended September 30, 2021 and 2020 and the balance sheet data as of September 30, 2021 and 2020 have been derived from unaudited financial statements included elsewhere in this prospectus. Our unaudited interim financial statements were prepared in accordance with U.S. generally accepted accounting principles, or U.S. GAAP, on the same basis as our audited financial statements and include, in the opinion of management, all adjustments, consisting or normal recurring adjustments that are necessary for the fair presentation of the financial information set forth in those financial statements. Our historical results are not necessarily indicative of the results that may be expected for any future periods, and the results for the nine months ended September 30, 2021 are not necessarily indicative of results that may be expected for the full fiscal year ended December 31, 2021. The following selected financial data should be read in conjunction with Management s Discussion and Analysis of Financial Condition and Results of Operations and our financial statements included elsewhere in the prospectus. Years Ended Nine Months Ended December 31, September 30, 2020 2019 2021 2020 (in thousands, except share and per share data) (unaudited) Statement of Operations Data: Revenues $ 9 $ 111 $ 4 $ 8 Operating expenses: Sales and marketing 8 250 72 7 General and administrative 3,380 4,176 1,886 2,007 Research and development 1,441 3,496 690 1,297 Depreciation and amortization 733 721 810 549 Stock-based employee compensation 71 194 11 65 Warrants issued for services 351 0 0 349 Impairment of capitalized engineering fees 0 0 4,330 0 Total operating expenses 5,984 8,837 7,799 4,274 Operating loss (5,975 ) (8,726 ) (7,795 ) (4,266 ) Other expense (income): Interest expense 1,438 455 649 1,086 Interest income (3 ) (22 ) (3 ) (3 ) Forgiveness of payroll protection program loan 0 0 (436 ) 0 Change in fair value of stock warrant liability 0 0 21 0 Income tax expense 3 2 2 0 Net loss (7,413 ) (9,161 ) (8,028 ) (5,349 ) Earnings per share Net loss per share attributable to common shareholders; basic and diluted $ (0.72 ) $ (0.89 ) $ (0.70 ) $ (0.52 ) Weighted average number of common shares basic and diluted 10,299,289 10,271,454 11,469,863 10,297,611 Pro forma net loss per share attributable to common shareholders (unaudited); basic and diluted $ $ Weighted average shares used to compute proforma net loss per share attributable to common shareholders (unaudited); basic and diluted As of December 31, As of September 30, 2020 2019 2021 (in thousands) (unaudited) Balance Sheet Data: Cash and cash equivalents $ 720 $ 2,085 $ 6,265 Working capital (1) (10,819 ) (9,890 ) (2,750 ) Total assets 26,204 28,555 26,836 Total current liabilities 11,612 12,601 9,261 Total liabilities 18,298 19,509 16,891 Total shareholder s equity 7,906 9,047 9,945 (1) We define working capital as current assets less current liabilities. MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our financial statements and related notes that appear elsewhere in this prospectus. In addition to historical financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this prospectus, particularly in Risk Factors . Overview We are an early-stage seafood and biopolymer production company pioneering the development and commercialization of a scalable, shallow-water indoor aquaculture technology platform. To date, we have focused nearly exclusively on research and development and now intend to commercialize our technology platform. We expect to become one of the premier domestic producers of superior shrimp and one of the only domestic FDA-registered at-scale producers of chitosan and subsequent chitosan derivatives, which we expect to be produced using Good Manufacturing Practices, or GMP, and to meet or exceed the reference standard set forth in the official chitosan monograph published by the United States Pharmacopeia National Formulary, or USP-NF. We expect to market USP-grade chitosan and chitosan derivatives to the biomedical, pharmaceutical, dermatology, and high-end consumer cosmetic markets. Our technology platform enables us to produce shrimp and shrimp exoskeleton material in a traceable, safe, and documented sustainable manner. The shrimp exoskeleton material represents a key raw material used in the production of chitosan and chitosan derivatives. On December 26, 2014, we started as tr Shrimp Systems, a division of our largest stockholder, Ralco Nutrition, Inc., or Ralco. Ralco exclusively licensed the super intense shallow water raceway technology that forms the basis of our Tidal Basin Technology from Texas A & M University through two license agreements further described in Business Licensed Technology below. We were spun out from Ralco through a series of transactions occurring during 2016 and 2017. Ralco first contributed the two license agreements and other assets to RNI Aquaculture, LLC, or RNI, an entity owned by Ralco and Jon and Brian Knochenmus, two of our directors. Following our incorporation in Delaware on February 23, 2017, RNI contributed the license agreements and other assets to us in exchange for shares of our common stock. Approximately $70 million of cash has been invested in our business primarily for research and development of our proprietary Tidal Basin Technology aquaculture platform. This included investments of approximately $10 million prior to our spin out from Ralco and RNI as discussed in Prospectus Summary Corporate Information above and approximately $60 million of debt and equity investments thereafter. Approximately $11 million of investments in our technology were utilized to develop and build Balaton Bay Reef, a pilot production facility commissioned in August 2018. Utilizing our shallow-water indoor aquaculture platform, which we refer to as Tidal Basin Technology, Balaton Bay Reef has produced shrimp and shrimp exoskeleton material confirming the technology, engineering, and processes necessary to commercially scale-up shrimp and shrimp exoskeleton material production in a controlled environment. We expect to construct our first commercial production facility, Madison Bay Harbor, in Madison, South Dakota and expect it will have the capacity to annually produce up to approximately 1,300,000 pounds of head-on/shell-on shrimp, or HOSO shrimp, which we expect will result in approximately 790,000 pounds of processed shrimp and provide shrimp exoskeleton material for up to approximately 2,800 kilograms of chitosan and/or chitosan derivatives. We have entered into an agreement with a CMO, Parimer Scientific, to develop private label USP-grade chitosan products and to develop the processes, procedures and equipment necessary for commercial manufacturing of such products. Upon successful completion of this development phase, we intend to enter into a commercial manufacturing agreement with Parimer for commercial production of such products. We have incurred significant operating losses since our spin out from Ralco and RNI and our incorporation in 2017. Our ability to generate product revenues sufficient to achieve profitability will depend on the successful development and commercialization of both the shrimp production and USP-grade chitosan business segments. Our net losses were $7.4 million and $9.2 million for the years ended December 31, 2020, and December 31, 2019, respectively. As of December 31, 2020, we had an accumulated deficit of $33.4 million. We expect to continue to incur significant expenses and losses for the foreseeable future in connection with our ongoing activities. As of September 30, 2021, we had cash of $6.3 million. We believe that the anticipated net proceeds from this offering, together with our existing cash, will enable us to finalize engineering of Madison Bay Harbor and fund our operating expenses for at least the next 12 months. Subsequent to this offering, and after the further advancement of the shrimp and chitosan businesses, we intend to raise additional equity and debt financing to construct Madison Bay Harbor. We estimate needing approximately $75 to $80 million in additional funds to construct Madison Bay Harbor, but we have not yet obtained bids to confirm our estimates. Likewise, we have based our other estimates on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. See Liquidity and Capital Resources below. COVID-19 The COVID-19 pandemic, which began in December 2019 and has spread worldwide, has affected our ability to conduct research and development activities, delayed the initiation and planning for future construction activities, disrupted regulatory activities and our ability to raise funds, and had other adverse effects on our business, results of operations, and financial condition. We furloughed employees and shut down the majority of our research and development activities at Balaton Bay Reef and our innovation center starting in May of 2020. In July 2021, we recalled employees to restart operations at Balaton Bay Reef. We are currently growing and producing shrimp in all eight Tidal Basins of Balaton Bay Reef. We are continuing to monitor the potential impact of the COVID-19 pandemic on our business and financial statements. We are following, and will continue to follow, recommendations from the United States Centers for Disease Control and Prevention as well as Federal, state, and local governments regarding working-from-home practices as well as return-to-work policies and procedures. We expect to continue to take actions as may be required or recommended by government authorities or as we determine are in the best interests of our employees and other business partners in the light of the pandemic. While we have largely returned to normal operations at Balaton Bay Reef, the ongoing COVID-19 pandemic could adversely affect our business, financial condition, results of operations, and prospects. Likewise, the pandemic has caused volatility in the financial markets and may adversely impact the United States economy, both of which could result in adverse effects on our business and operations and our ability to raise additional funds to support our operations. Revenue We will generate product revenue primarily through sales of our shrimp and USP-grade chitosan. We expect that sales of our shrimp will be modest and infrequent until Madison Bay Harbor, our first commercial production Harbor in Madison, SD, is constructed, commences operations, and becomes fully operational. If we are successful raising the necessary funds, we expect to break ground and start construction on this facility in calendar year 2022. In addition, sales of chitosan will commence from the operations of Balaton Bay Reef after we obtain FDA-registration as a producer of chitosan, which we expect to occur in the third quarter of 2022. In the future, we believe that our revenue will depend upon the number and capacity of Harbors we have in operation, and the market acceptance of our products. Cost of Sales Cost of sales in the future will include labor and related costs to produce shrimp, including feed and other direct costs, overhead, and the cost to process and ship our products to customers. Cost of sales will also include the cost to convert the shrimp exoskeleton material to chitosan. We have not recorded cost of sales associated with the sales of shrimp from Balaton Bay Reef, as the initial objective of the facility was research and development rather than production. Sales and Marketing Expenses Our sales and marketing expenses currently include travel, consulting fees, and other direct costs for market-related activities. As of September 30, 2021, we had one employee dedicated to sales and marketing. General and Administrative Expenses General and administrative expenses consist primarily of salaries and related costs for employees in executive, corporate, shared services, and finance functions. Other significant general and administrative expenses include corporate governance, regulatory compliance, rent and utilities, insurance, public relations, and legal services. We had seven employees in our general and administrative group as of September 30, 2021. Research and Development Expenses As of September 30, 2021, we employed four research scientists and ten technicians at our facilities in Balaton, Minnesota involved with our research and development and production activities at Balaton Bay Reef. We recognize research and development expenses as they are incurred. Our research and development expenses consist primarily of: salaries and related overhead expenses for personnel in research and development functions; fees paid to contract research organizations and consultants who perform research for us; costs related to feed and laboratory supplies used in our research and development efforts; and costs related to the operation of Balaton Bay Reef. Other Income (Expense) Interest expense includes the interest on our outstanding loans, including the amortization of debt discount related to the issuance of stock warrants in conjunction with the issuance of convertible notes. Other income (expense) includes interest income, and debt forgiveness income related to our Payroll Protection Program, or PPP, loans. Significant Accounting Policies and Estimates This Management s Discussion and Analysis of our Financial Condition and Results of Operations is based on our financial statements, which we have prepared in accordance with United States generally accepted accounting principles, or United States GAAP. The preparation of our financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported revenues and expenses during the reporting periods. We evaluate these estimates and judgments on an ongoing basis. We base our estimates on historical experience and on various other factors that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Our actual results may differ from these estimates under different assumptions or conditions. While our significant accounting policies are more fully described in Note 2 to our audited financial statements appearing elsewhere in this prospectus, we believe that the following accounting policies are the most critical for fully understanding and evaluating our financial condition and results of operations. Valuation of Long-Lived Assets The Company evaluates the carrying values of long-lived assets annually and when events and circumstances indicate that an asset may not be recoverable or that depreciation or amortization lives should be modified. Stock-Based Compensation Stock-based compensation is measured based on the estimated fair value of the award on the grant date. The fair value of options is calculated using the Black-Scholes option pricing model and is recognized into expense over the requisite vesting or service period. Net loss per share Basic and diluted net loss per share available to common stockholders has been calculated by dividing net loss by the weighted average number of common shares outstanding during the year. Basic net loss is based solely on the weighted average number of common shares outstanding during the year. Fully diluted net loss per share includes the number of shares of common stock issuable upon the exercise of warrants and options with an exercise price less than the fair value of the common stock. Since the Company is reporting a net loss for all periods presented, all potential common shares are considered anti-dilutive and are excluded from the calculation of diluted net loss per share. Income Taxes Deferred income tax assets and liabilities are computed for differences between the financial statement and tax bases of assets and liabilities that result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. We have had a history of net losses since inception, and, as a result, we have established a 100% valuation allowance for our net deferred tax assets. If circumstances change, and we determine that we will be able to realize some or all of these net deferred tax assets in the future, we will record an adjustment to the valuation allowance. Income tax expense is the tax payable or refundable for the period plus or minus the change during the period in deferred income tax assets and liabilities. Results of Operations Comparison of the year ended December 31, 2020, to the year ended December 31, 2019. The following table summarizes our results of operations for the years ended December 31, 2020, and 2019, together with the changes in those items in dollars and as a percentage (all dollar amounts in thousands): Year Ended December 31, Dollar % 2020 2019 Change Change Revenues $ 9 $ 111 $ (102 ) (92 %) Operating expenses: Sales and marketing 8 250 (242 ) (97 %) General and administrative 3,380 4,176 (796 ) (19 %) Research and development 1,441 3,496 (2,055 ) (59 %) Depreciation and amortization 733 721 12 2 % Stock-based employee compensation 71 194 (123 ) (63 %) Warrants issued for services 351 0 351 n/a Total operating expenses 5,984 8,837 (2,853 ) (32 %) Operating loss (5,975 ) (8,726 ) (2,751 ) (32 %) Other expense (income) Interest income (3 ) (22 ) (19 ) (86 %) Interest expense 1,438 455 983 216 % Other expense, net 1,435 433 1,002 231 % Net loss before income taxes (7,410 ) (9,159 ) (1,749 ) (19 %) Income tax expense 3 2 1 50 % Net loss $ (7,413 ) $ (9,161 ) $ (1,748 ) (19 %) Revenue Revenue for the year ended December 31, 2019 was approximately $0.1 million and related primarily to the performance of research and grant services and sales of shrimp from Balaton Bay Reef. We started to process the shrimp production from Balaton Bay Reef in September 2019 after we obtained approval from the FDA for the use of a local processing center. Revenue for the year ended December 31, 2020 was approximately $0.01 million, a 92% decrease from the year ended December 31, 2019. The decrease resulted from the shutdown of operations at Balaton Bay Reef in the spring of 2020 due to the impact of the COVID-19 pandemic on our capital raise activities. Balaton Bay Reef became operational again in July 2021. Sales of chitosan will not be significant until we develop our chitosan products, finalize a contract manufacturing agreement and obtain FDA registration as a supplier. We did not record cost of sales associated with sales of shrimp in both years as the main objective of the facility was research and development rather than commercial production. Sales and Marketing Expenses Sales and marketing expenses for the year ended December 31, 2020, were approximately $0.01 million, a decrease of approximately $0.24 million, or 97%, from the corresponding period in 2019 due to the shutdown of operations of Balaton Bay Reef as a result of the COVID-19 pandemic. General and Administrative Expenses General and administrative expenses for the year ended December 31, 2020, were approximately $3.4 million, a decrease of approximately $0.8 million, or 19%, from the corresponding period in 2019. This decrease in 2020 was in part the result of the COVID-19 impact on overall activities, including reductions in payroll costs and outside professional services. Research and Development Expenses Research and development expenses for the year ended December 31, 2020, were approximately $1.4 million, a decrease of approximately $2.0 million, or 59%, from the corresponding period in 2019 due primarily to the shutdown of operations of Balaton Bay Reef as a result of the COVID-19 pandemic. This impacted all of the operations in Balaton including Balaton Bay Reef, the innovation center, and our mini-hatchery, and included reductions in personnel costs, feed, laboratory, and other operations costs. Additionally, 2019 was the first full year of operations and costs for Balaton Bay Reef. Warrants Issued for Services Expenses related to warrants issued for services were $0.35 million for the year ended December 31, 2020. These expenses were in lieu of cash payments for consulting services. There were no similar expenses for the year ended December 31, 2019. Interest Expense Interest expense for the year ended December 31, 2020, was approximately $1.44 million, an increase of approximately $1.0 million, or 216%, as compared to $0.5 million for the year ended December 31, 2019. The increase resulted from the issuance of $5.5 million in convertible notes and related stock warrants in 2020 and 2019 related to a PPM offering dated August 2019. The convertible notes were converted into common stock as of December 31, 2020. In conjunction with the issuance of the stock warrants, we recorded a debt discount that has been fully amortized into interest expense using the effective interest method through December 31, 2020. We recorded the amortized debt discount in the amount of $566,000 and $20,000 as interest expense in 2020 and 2019, respectively. In addition, we recorded $208,000 in 2020 as non-cash interest associated with the convertible notes outstanding during the period. Furthermore, in 2020, the Eagle Energy Note was outstanding for twelve months compared to five months in 2019. Net Loss Accordingly, as a result of the above factors, we recorded a net loss of $7.4 million in 2020, as compared to a net loss of $9.2 million in 2019. Comparison of the nine months ended September 30, 2021, to the nine months ended September 30, 2020. The following table summarizes our results of operations for the nine months ended September 30, 2021, and 2020, together with the changes in those items in dollars and as a percentage (all dollar amounts in thousands): Nine Months Ended September 30, Dollar % 2021 2020 Change Change Revenues $ 4 8 $ (4 ) (50 %) Operating expenses: Sales and marketing 72 7 65 929 % General and administrative 1,886 2,007 (121 ) (6 %) Research and development 690 1,297 (607 ) (47 %) Depreciation and amortization 810 549 261 48 % Stock-based employee compensation 11 65 (54 ) (83 %) Warrants issued for services 0 349 (349 ) (100 %) Impairment of capitalized engineering fees 4,330 0 4,330 N/A Total operating expenses 7,799 4,274 3,525 82 % Operating loss (7,795 ) (4,266 ) 3,529 83 % Other expense (income) Interest expense 649 1,086 (437 ) (40 %) Interest Income (3 ) (3 ) 0 0 % Forgiveness of payroll protection program loan (436 ) 0 436 N/A Change in fair value of stock warrant liability 21 0 21 N/A Other expense, net 231 1,083 (852 ) (79 %) Net loss before income taxes (8,026 ) (5,349 ) 2,677 50 % Income tax expense 2 0 2 N/A Net loss $ (8,028 ) (5,349 ) $ 2,679 50 % Revenues Revenue for the nine months ended September 30, 2021 was approximately $0.004 million, a decrease of approximately $0.004 million, or 50%, from the corresponding period in 2020. The decrease resulted from the shutdown of operations at Balaton Bay Reef in the spring of 2020 due to the impact of the COVID-19 pandemic on our capital raise activities and on our operations. Balaton Bay Reef became operational again in July 2021. We expect that the sales of our shrimp production will be modest and infrequent until Madison Bay Harbor is constructed and commences operations. Sales of chitosan will not be significant until we develop our chitosan products, finalize a contract manufacturing agreement and obtain FDA registration as a supplier. We did not record cost of sales associated with sales of shrimp in both years as the main objective of the facility was research and development rather than commercial production. Sales and Marketing Expenses Sales and marketing expenses for the nine months ended September 30, 2021, were approximately $0.07 million, an increase of approximately $0.065 million, or 929%, from the corresponding period in 2020. This resulted from the resumption of marketing and public relations costs in the summer of 2021, which were no longer directly related to capital raise activities as was the case in 2020. General and Administrative Expenses General and administrative expenses for the nine months ended September 30, 2021, were approximately $1.9 million, a decrease of approximately $0.12 million, or 6%, from the corresponding period in 2020. This decrease in 2021 was a result of a specific effort to reduce costs because of the COVID-19 impact on overall activities. This decrease resulted from reductions in salary costs, compensation, fringe benefits, and other general business expenses. Research and Development Expenses Research and development expenses for the nine months ended September 30, 2021, were approximately $0.7 million, a decrease of approximately $0.6 million, or 47%, from the corresponding period in 2020 due primarily to the shutdown of operations of Balaton Bay Reef because of the COVID-19 pandemic in the spring of 2020. Operations commenced again at Balaton Bay Reef in July 2021. The 2020 shutdown impacted all the operations in Balaton including Balaton Bay Reef, the innovation center, and our mini-hatchery, and included reductions in personnel costs, feed, laboratory, and other operations costs. The primary reductions in the nine months ended September 30, 2021 as compared to 2020 related to an approximate $0.3 million reduction in salary and compensation costs and an approximate $0.2 million reduction in consulting related to genetic development costs. Warrants Issued for Services Expenses related to warrants issued for services were $0.35 million for the nine months ended September 30, 2020. These expenses were in lieu of cash payments for consulting services. There were no similar expenses in the nine-month period ended September 30, 2021. Impairment of Capitalized Engineering Fees In June of 2021, the company decided to reduce the size of its first planned production facility. As a result of this, the Company determined that they were size specific costs capitalized to construction in progress and capitalized interest that have no future realizable value. Management recorded an impairment expense of $4.3 million in June 2021 of size specific costs previously capitalized in construction in progress. Interest Expense Interest expense for the nine months ended September 30, 2021, was approximately $0.65 million, a decrease of approximately $0.44 million, or 40%, as compared to $1.1 million for the nine months ended September 30, 2020. The decrease resulted primarily from the amortized debt discount of $566,000 related to convertible notes and related stock warrants recorded as interest expense in 2020 from a private placement dated August 2019. The convertible notes were converted into common stock as of December 31, 2020. There were no similar amounts recorded in the nine-month period ended September 30, 2021. Other Income Other income for the nine months ended September 30, 2021, includes $0.44 million of income related to the forgiveness of a PPP loan. There were no similar amounts in the nine-months ended September 30, 2020. Net Loss Accordingly, as a result of the above factors, we recorded a net loss of $8.0 million for the nine-month period ended September 30, 2021, as compared to a net loss of $5.3 million for the nine-month period ended September 30, 2020. Liquidity and Capital Resources We have incurred significant net losses and negative cash flows from operations since our spin out from Ralco and RNI and our incorporation in 2017. We have an accumulated deficit of $41.5 million and a cash balance of $6.3 million as of September 30, 2021. Since the commencement of our operations thru September 30, 2021, which includes the period of time when we were a division of Ralco, we received cash proceeds from equity-related financing (including convertible notes which have been converted to equity) totaling approximately $55.2 million. In addition, we have received cash proceeds from debt financing, including debt that may convert into equity, totaling approximately $14.4 million. Total cash we have raised from equity and debt proceeds, including during our time as part of Ralco, was approximately $69.6 million. As of September 30, 2021, our cash balance is $6.3 million. For the year ended December 31, 2020, management previously stated that there was substantial doubt about our ability to continue as a going concern due to our limited capital resources. Our independent registered public accounting firm also indicated this in its report to the stockholders and the Board of Directors. Accordingly, management prepared a plan to mitigate this doubt, which included offerings of common stock, warrants, and convertible notes in 2021 that provided the Company with approximately $10.4 million of cash proceeds through September 30, 2021. We do not expect significant revenues until Madison Bay Harbor is constructed and operational. Further, after completion of this offering, we expect that we will need to raise approximately $75 to $80 million in additional equity and/or debt financing to construct Madison Bay Harbor. Management continues to have substantial doubt of our ability to continue as a going concern due primarily to the risks and uncertainties with respect to raising such capital and constructing and commencing operations at Madison Bay Harbor. Since inception, cash has been primarily used to finance capital expenditures, fund operations, corporate and management activities, and for research and development costs. Capital expenditures include the construction of the laboratory and innovation center in Balaton, Minnesota, the construction of Balaton Bay Reef, the Company s computer systems and related software, and engineering and pre-construction costs related to Madison Bay Harbor. As of September 30, 2021, we had approximately $7.4 million of outstanding debt that will require cash repayment as opposed to conversion into equity. This includes a $6.0 million promissory note issued on July 31, 2019 to Eagle Energy LLC, a shareholder of the Company, that is secured by substantially all of the Company s assets and bears interest at a rate equal to 6.45% per annum. The note matures on June 1, 2026, with interest only payments for the first 36 months and with quarterly principal payments of $300,000 and interest payments commencing on September 1, 2022. Our debt as of September 30, 2021, also includes a contract for deed executed July 1, 2018, with a balance of $950,000 at September 30, 2021 with Knochenmus Enterprises LLP, an affiliate of two of our board members, for purchase of commercial space in Balaton, Minnesota that is used for our corporate offices, laboratories and other activities. The term of the agreement is for 15 years with an interest rate of 6.75%. Our debt as of September 30, 2021, also includes two notes issued to Bremer Bank for PPP loans. The first had an original principal amount of $483,000, of which $436,573 was forgiven under the PPP program and has been reflected as debt forgiveness income in 2021 and $26,943 remained outstanding as of September 30, 2021. The second had an original principal amount of $436,638, all of which remains outstanding. We believe a significant portion of the second PPP loan will also be forgiven. Interest accrues on each of the PPP loan balances at a rate of 1.0% per annum and remaining obligations for first and second PPP loan that are not forgiven will mature on March 31, 2022, and January 25, 2025, respectively. In addition, we have an aggregate of approximately $7.8 million in outstanding convertible promissory notes as of September 30, 2021. We currently expect each of these notes to convert into equity and not require cash repayment. This includes a $6.5 million note issued in December 2018 to Lake Area Improvement Corporation, or LAIC, the local economic development agency in Madison, SD that owns the land on which we plan to purchase as the site for Madison Bay Harbor. This note accrues interest at two percent (2%) per annum and had an original maturity date of December 27, 2019, which has been extended in 2019, 2020, and 2021, to a current maturity date of January 10, 2023. The accrued interest has been added to the balance of the convertible note at each of the extension dates. The Company may, at its option, convert all or part of the amount of the note to common stock if construction of Madison Bay Harbor has commenced by January 10, 2023. If construction has not commenced by January 10, 2023, then LAIC may convert the note to non-voting preferred stock or extend the note to a later date. We are permitted to pay the principal and accrued interest in full on or prior to the maturity. Our other outstanding convertible promissory notes as of September 30, 2021, consist of promissory notes issued to other investors during 2021. The notes will reach maturity on September 30, 2024, and are accruing interest at 6.00% annually. The notes will convert into equity at the qualified financing terms before the maturity date based on the occurrence of a qualified financing into the Company, which would include this offering. If no qualified offering occurs upon the promissory notes reaching the maturity date, the notes will convert at the offering price of the most recently closed offering on a common stock equivalent basis. We believe that the anticipated net proceeds from this offering, together with our existing cash, will enable us to finalize engineering of Madison Bay Harbor and fund our operating expenses for at least the next 12 months. Subsequent to this offering, and after the further advancement of the shrimp and chitosan businesses, we intend to raise additional equity and debt financing to construct Madison Bay Harbor. As noted above, we estimate needing approximately $75 to $80 million in additional funds to construct Madison Bay Harbor, but we have not yet obtained bids to confirm our estimates. We have based this and our other estimates on assumptions that may prove to be wrong, and we could exhaust our available capital resources sooner than we expect. In addition, we may not be able to raise additional financing or do so at terms that are acceptable. In either case, we may need to materially reduce expenditures, slow down, delay or stop certain capital spending, including engineering and construction of Madison Bay Harbor, and/or divest assets. Cash Flows The following table sets forth the significant sources and uses of cash for the periods set forth below (in thousands): Years Ended Nine Months Ended December 31, September 30, 2020 2019 2021 2020 (unaudited) Net cash provided by (used in): Operating activities $ (5,227 ) $ (7,198 ) $ (4,781 ) $ (4,043 ) Investing activities (55 ) (6,905 ) (60 ) (11 ) Financing activities 3,918 10,114 10,386 2,269 Net increase (decrease) in cash $ (1,364 ) $ (3,989 ) $ 5,545 (1,785 ) Comparison of the years ended December 31, 2020 and 2019 Cash Flows from Operating Activities Net cash used in operating activities during the year ended December 31, 2020, was primarily comprised of our $7.4 million net loss, offset by non-cash depreciation of $727,000, non-cash interest and amortization of debt discount totaling $907,000, write-off of capital acquisition costs of $436,000, and non-cash charges for warrants issued for services of $352,000. The decrease in cash utilized in operations in 2020 as compared to 2019 was in part due to the shutdown of research activities as a result of the COVID-19 pandemic in the spring of 2020. Net cash used in operating activities during the year ended December 31,2019, was primarily comprised of our $9.2 million net loss, offset by non-cash depreciation of $715,000, non-cash interest and amortization of debt discount totaling $184,000, stock compensation expenses of $195,000, and an increase in accounts payable of $950,000. Cash Flows from Investing Activities During 2020, we curtailed any major purchases of capital assets due to the COVID-19 pandemic. In 2019, we used approximately $6.9 million for purchases of property and equipment, primarily consisting of payments related to the completion of Balaton Bay Reef and the engineering planning and development efforts for Madison Bay Harbor. Cash Flows from Financing Activities During 2020, we received approximately $4.0 million in proceeds from the issuance of convertible notes in private offerings and $483,000 from the issuance of debt. These funds were offset by $273,000 in debt repayments and $247,000 in capital acquisition costs. During 2019, we received $500,000 in proceeds from the issuance of our common stock in a private placement of shares, $4.7 million from the issuance of convertible promissory notes in private offerings, and $6.0 million from the issuance of debt. These funds were offset by $555,000 in debt repayments, and $556,000 in capital acquisition costs and financing fees. Comparison of the nine months ended September 30, 2021 and 2020 Cash Flows from Operating Activities Net cash used in operating activities during the nine months ended September 30, 2021, was primarily comprised of our $8.0 million net loss, increased by $437,000 of PPP loan forgiveness and payments of $1,180,000 of accounts payable and $331,000 of accrued expenses, all off-set by non-cash depreciation of $805,000, non-cash interest of $107,000 and impairment of capitalized engineering fees of $4,330,000. Net cash used in operating activities during the nine-months added September 30, 2020, was primarily comprised of our $5.3 million net loss offset by cash depreciation of $545,000, non-cash interest and amortization of debt discount totaling $552,000 and non-cash warrant expense of $349,000. Cash Flows from Investing Activities During 2021 and 2020, we curtailed all major purchases of capital assets due to the COVID-19 pandemic and its impact on fundraising activities. Total cash paid for capital expenditures was $60,000 for the nine months ended September 30, 2021, as compared to $11,000 for the nine-months ended September 30, 2020. Cash Flows from Financing Activities In the nine months ended September 30, 2021, we received approximately $9.4 million in proceeds from the sale of common stock and warrants and $950,000 from convertible notes under our private placement offerings. In addition, we received $437,000 from the issuance of debt. These funds were offset by $313,000 paid for capital acquisition costs and $97,000 in debt repayments. In the nine months ended September 30, 2020, we received approximately $2.5 million in proceeds from convertible notes under our private placement offering. In addition, we received $483,000 from the issuance of debt. These funds were offset by $536,000 paid for capital acquisition costs and $203,000 in debt repayments. Recently Issued Accounting Pronouncements In February 2016, the FASB issued ASU No. 2016-02, Leases, which increases transparency and comparability among organizations by recognizing all lease transactions with terms of more than 12 months on the balance sheet as a lease liability and a right-of-use asset, as defined. This ASU will be effective for the Company in 2022. Upon adoption, the lessee will apply the new standard retrospectively to all periods presented or a modified retrospective approach using a cumulative effect adjustment in the year of adoption. We are currently evaluating the impact that this standard will have on our financial statements. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in ASC 740 and also clarifies and amends existing guidance to improve consistent application. This ASU will be effective for the Company in 2022. The adoption of ASU 2019-12 is not expected to have a significant impact on the Company s financial statements. Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, we are not required to provide disclosure pursuant to this item. Interest Rate Risk Our primary exposure to market risk is interest rate risk associated with debt financing that we utilize from time to time to fund operations or specific projects. The interest on this debt is usually determined based on a fixed rate and is contractually set in advance. As of December 31, 2020, and December 31, 2019, we had $7.5 million and $7.3 million (excluding convertible notes), respectively, in interest-bearing debt instruments on our balance sheet. All of our interest-bearing debt is at fixed rates. BUSINESS Overview We are an early-stage seafood and biopolymer production company pioneering the development and commercialization of a scalable, shallow-water indoor aquaculture technology platform. To date, we have focused nearly exclusively on research and development and now intend to commercialize our technology platform. We expect to become one of the premier domestic producers of premium positioned shrimp and one of the only domestic FDA-registered at-scale producers of chitosan and subsequent chitosan derivatives, which we expect to be produced using Good Manufacturing Practices, or GMP, and to meet or exceed the reference standards set forth in the official chitosan monograph published by the United States Pharmacopeia National Formulary, or USP-NF. We expect to market USP-grade chitosan and chitosan derivatives to the biomedical, pharmaceutical, dermatology, and high-end consumer cosmetic markets. Our extensive research, development, and optimization has led to a technology platform that enables us to produce shrimp and shrimp exoskeleton material at scale in a traceable, safe, and documented sustainable manner. The shrimp exoskeleton material represents a key raw material used in the production of chitosan and chitosan derivatives. We invested approximately $11 million to develop and build Balaton Bay Reef, a pilot production facility commissioned in August 2018. Utilizing our shallow-water indoor aquaculture platform, which we refer to as Tidal Basin Technology, Balaton Bay Reef has produced shrimp and shrimp exoskeleton material confirming the technology, engineering, and processes necessary to commercially scale-up shrimp and shrimp exoskeleton material production in a controlled environment. We expect to construct our first commercial production facility, Madison Bay Harbor, in Madison, South Dakota. Based on management s estimates and production data from Balaton Bay Reef, we expect it will have the capacity to annually produce up to approximately 1,300,000 pounds of HOSO shrimp, which we expect will result in approximately 790,000 pounds of processed shrimp and provide shrimp exoskeleton material for up to approximately 2,800 kilograms of chitosan and/or chitosan derivatives. We have entered into an agreement with a CMO, Parimer Scientific, to develop private label USP-grade chitosan products from our exoskeleton material and to develop the processes, procedures and equipment necessary for commercial manufacturing of such products. Upon successful completion of this development phase, we intend to enter into a commercial manufacturing agreement with Parimer for commercial production of such products. Balaton Bay Reef campus during construction. Interior Balaton Bay Reef.
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001737189_redaptive_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001737189_redaptive_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001737193_aphoenity_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001737193_aphoenity_prospectus_summary.txt
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+II-6 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in Hong Kong, on June 17, 2022. LUDUSON G INC. (Name of Registrant) By: /s/ Ka Leung Wong Name: Ka Leung Wong Title: Chief Executive Officer (principal executive officer) By: /s/ Lan Chan Name: Lan Chan Title: Chief Financial Officer (principal accounting officer and principal financial officer) POWER OF ATTORNEY KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Ka Leung Wong, as her true and lawful attorney-in-fact and agent with full power of substitution and resubstitution, for him and in her name, place and stead, in any and all capacities, to sign any or all amendments (including post-effective amendments) to this Registration Statement on Form S-1 of Luduson G Inc., and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, grant unto said attorney-in-fact and agent, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the foregoing, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and agent, or her substitutes, may lawfully do or cause to be done by virtue hereof. In accordance with the requirements of the Securities Act of 1933, this registration statement was signed by the following persons in the capacities and on the dates stated. Dated: June 17, 2022 By: /s/ Ka Leung Wong Name: Ka Leung Wong Title: Chief Executive Officer (principal executive officer) Dated: June 17, 2022 By: /s/ Lan Chan Name: Lan Chan Title: Chief Financial Officer (principal accounting officer and principal financial officer) II-7
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001737372_sysorex_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001737372_sysorex_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001756499_mcloud_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001756499_mcloud_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights information that we present more fully in the rest of this prospectus. This summary does not contain all of the information you should consider before buying Series A Preferred Shares and Warrants in this offering. This summary contains forward-looking statements that involve risks and uncertainties, such as statements about our plans, objectives, expectations, assumptions or future events. In some cases, you can identify forward-looking statements by terminology such as anticipate, estimate, plan, project, continuing, ongoing, expect, we believe, we intend, may, should, will, could, and similar expressions denoting uncertainty or an action that may, will or is expected to occur in the future. These statements involve estimates, assumptions, known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from any future results, performances or achievements expressed or implied by the forward-looking statements. You should read the entire prospectus carefully, including the Risk Factors section and the financial statements and the notes to those statements. Corporate Information We are a Canadian corporation and our principal executive offices are located at 550-510 Burrard St., Vancouver, British Columbia, V6C 3A8 and the registered office is located at 2686 Point Grey Rd., Vancouver, BC, V6K 1A5, Canada and our phone number is (604) 669-9973. Our Company Overview The Company delivers solutions combining Internet of Things (IoT), artificial intelligence (AI), and the cloud to unlock the untapped potential of energy- intensive assets such as: HVAC units and refrigerators in commercial buildings; control systems, heat exchangers, and compressors at process industry facilities; and wind turbines generating renewable energy at onshore wind farms. IoT enables inexpensive, readily scalable connectivity to these and other under-served assets. Data from these IoT sensors are taken into the cloud, where digital twins of these assets are created, and AI is applied to identify opportunities to optimize asset performance. Asset operators and maintainers who manage these assets in the field are guided through a portfolio of mobile, connected applications that enable these teams to take asset management actions that ensure optimal performance. Through the Company s proprietary AssetCare platform, AI is used to identify opportunities to improve asset performance and enable asset operators and maintainers to take direct action creating these measurable improvements. Some key applications of the Company s AssetCare technology at work include: curbing wasted energy while improving occupant comfort in commercial facilities through AI-powered adaptive control; maximizing asset availability and production yields of renewable energy sources through continuous performance assessment and predictive maintenance; and optimizing the uptime and manage the operational risk of industrial process plants, including oil and gas facilities, through continuous AI-powered advisory and assistance to process operators in the field. In all markets, the Company uses a commercial Software-as-a-Service ( SaaS ) business model to distribute its AssetCare solution. Customers pay a simple, subscription-based price that is determined by number of assets, asset size or complexity, and the expected efficiency gains to be created using AI and analytics. Set up as multi-year, recurring subscriptions, customers pay no fees upfront to onboard an AssetCare solution; any upfront costs are leveraged across the lifetime of the initial subscription period. Certain software and technologies used in AssetCare solutions are also offered to some customers on a perpetual basis. Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state or other jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED December 20, 2022 mCLOUD TECHNOLOGIES CORP. 1,000,000 9.0% Series A Cumulative Perpetual Preferred Shares Warrants to purchase 25,000,000 Common Shares Maximum Offering: $25,000,000 of Securities We are offering for sale, on a best efforts basis, of registered securities and up to a maximum of an aggregate of $25,000,000 (the Maximum Amount ) of registered securities. We are offering up to 1,000,000 Units of 9.0% Series A Cumulative Perpetual Preferred Shares, no par value, with a $25.00 liquidation preference per share (the Series A Preferred Shares ) with 25 warrants (each, a Warrant , and together, the Warrants ) to purchase one common share, no par value per share (each, a Common Share , and together, the Common Shares ), at an assumed combined public offering price of $25.00 per Series A Preferred Share and related Warrant, representing a public offering price of $24.75 per Series A Preferred Share and $0.01 per related Warrant. The Warrants are exercisable from the date of issuance and expire on November 29, 2026, at an exercise price per Common Share equal to $4.75. The Series A Preferred Shares and Warrants can only be purchased together in this offering but the Series A Preferred Shares and Warrants are immediately separable and will be issued separately. We are in the process of applying to have the Series A Preferred Shares sold in this offering listed on the Nasdaq Capital Market ( Nasdaq ) under the symbol MCLDP . There is no assurance that our listing application will be approved. We will not consummate this offering unless the Series A Preferred Shares will be listed on the Nasdaq Capital Market. The Warrants will be listed on Nasdaq along with the Listed Warrants (as defined below) under the symbol ( MCLDW ). The liquidation preference of each Series A Preferred Share is $25.00. Upon liquidation, holders of Series A Preferred Shares will be entitled to receive the liquidation preference with respect to their Series A Preferred Shares plus an amount equal to accumulated but unpaid dividends with respect to such shares. The Series A Preferred Shares have no voting rights with respect to matters that generally require the approval of voting shareholders. The Series A Preferred Shares are convertible into Common Shares of the Company following the issuance date based on a conversion ratio of (i) the $25.00 per share liquidation preference divided by (ii) $1.00 (subject to adjustment for certain dilutive issuances). Therefore, each Series A Preferred Share is initially convertible into 25 Common Shares. Upon such a conversion, any declared but unpaid dividends on the converted Series A Preferred Shares would be paid in cash. In the event that the conversion would result in the issuance of fractional Common Shares, we will pay the holder the cash value of such fractional shares in lieu of such fractional shares based on a price per Common Share equal to the then current conversion price. The Series A Preferred Shares are not redeemable prior to [ ], which is the first anniversary of the initial closing date of this offering, except in connection with a Delisting Event or Change of Control (each as defined in the Prospectus Summary) as described below. If there is an $8 VWAP Event (as defined in the Prospectus Summary) on or after [ ], the Series A Preferred Shares may be redeemed at our option, in whole or in part, within 90 days after the date of the $8 VWAP Event at a redemption price of $25.00 per Series A Preferred Share, plus all dividends accumulated and unpaid (whether or not declared) on the Series A Preferred Shares up to, but not including, the date of such redemption, upon the giving of notice. Upon the occurrence of any Delisting Event or Change of Control, whether before or after the twelve (12) month anniversary of the date of issuance of the Series A Preferred Shares, we may, at our option, redeem the Series A Preferred Shares, in whole or in part and within 90 days after the date of the Delisting Event or Change of Control, by paying $25.00 per share of Series A Preferred Shares, plus all dividends accumulated and unpaid (whether or not declared) on the Series A Preferred Stock up to, but not including, the date of such redemption. Subject to the preferential rights, if any, of the holders of any class or series of capital stock of the Company ranking senior to the Series A Preferred Shares as to dividends, the holders of the Series A Preferred Shares will be entitled to receive, when, as and if declared by the Board (or a duly authorized committee of the Board), only out of funds legally available for the payment of dividends, cumulative cash dividends at the annual rate of 9.0% of the $25.00 liquidation preference per year (equivalent to $2.25 per year) until the beginning of the fifth year following the issuance of the Series A Preferred Shares, at which time the annual rate will increases 4.0% per calendar quarter until it reaches a maximum of 25.0%. For example, the initial increase in the dividend rate from 9.0% to 13.0% will result in an increase in the dividend amount, on an annual basis, from $2.25 to $3.25. Dividends on the Series A Preferred Shares will accumulate and be cumulative from, and including, the date of original issue by us of the Series A Preferred Shares. The Company can at its discretion, defer payment of all cumulative dividends under all circumstances until liquidation. Our Common Shares and our warrants issued in November 2021 (the Listed Warrants ) are currently listed on Nasdaq under the symbols MCLD and MCLDW , respectively. On December 15, 2022, the last reported sale price of our Common Shares was $1.02 per share and the last reported sale price of our Listed Warrants was $0.1797 per Listed Warrant. Our Common Shares are also listed on the TSXV under the symbol MCLD . On December 15, 2022, the last reported sale price of our Common Shares on the TSXV was CAD$1.42 per share. There is no minimum number of Series A Preferred Shares and accompanying warrants that must be sold as a condition to closing this offering. Therefore, the actual offering amount, placement agent fees and proceeds to us, if any, are not presently determinable and may be substantially less than the maximum offering amounts set forth below. An investment in our securities is highly speculative, involves a high degree of risk and should be considered only by persons who can afford the loss of their entire investment. See Risk Factors beginning on page 13 of this prospectus. Per Share Per Related Twenty Five Warrants Total if Maximum Offering is Raised Public offering price $ 24.75 $ 0.25 $ 25,000,000 Placement agent fees (1) $ 1.7325 $ 0.0175 $ 1,750,000 Proceeds, before expenses, to us $ 23.0175 $ 0.2325 $ 23,250,000 (1) See Plan of Distribution on page 129 of this prospectus for a description of all placement agent compensation payable in connection with this offering. Because this is a best efforts offering, the placement agent does not have an obligation to purchase any securities, and, as a result, there is a possibility that we may not be able to sell the maximum offering amount. We expect this offering to be completed not later than two business days following the commencement of this offering and we will deliver all securities to be issued in connection with this offering delivery versus payment/receipt versus payment upon receipt of investor funds received by us. Accordingly, neither we nor the placement agent have made any arrangements to place investor funds in an escrow account. THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. The date of this prospectus is , 2022 American Trust Investment Services, Inc. Table of Contents Marketing Channels The Company maintains a robust presence in seven countries: Canada, the United States, the United Kingdom, the Kingdom of Bahrain as the gateway to markets in the Middle East, China, Singapore and Australia, supplemented by a growing international network of channel and delivery partners around the world. The Company employs sales team members in these countries charged with direct sales efforts of AssetCare solutions. Global marketing efforts to support these sales efforts include virtual campaigns and events to attract new customers, strengthen relationships with existing customers, and building brand presence and visibility. The Company also hosts an annual user conference called mCloud Connect, which includes head-liners from well-known industry leaders, panels, and interactive sessions to gather voice of the customer feedback, which is used to improve the Company s portfolio of AssetCare offerings. The Company has conducted extensive research to size the markets and opportunities it can access through its AssetCare platform. The Company estimates it has the capability of serving over 7.3 million commercial buildings and over 34,000 industrial sites in 20 different locales worldwide, with each building or site representing multiple potential connectable assets, workers, or 3D digital twins. Serviceable commercial buildings include restaurants, mid-size retail (including retail finance sites such as bank branches), and long-term care facilities. In these buildings, the Company connects to assets such as HVAC, lighting, and refrigeration units. Connectable workers include people involved in the day-to-day operation or maintenance of these commercial buildings, including mechanical service workers and facility managers. Industrial sites include oil and gas, liquefied natural gas, and floating production storage and offloading facilities, as well as wind farms, mining processing plants, and pulp and paper facilities. In these locations, connectable assets include process control systems, heat exchangers, pumps, and gas compressors. Connectable workers include field operators, maintainers, engineers, asset managers, and plant managers. The Company s experience in delivering digital 3D models from entire multi-billion-dollar assets the size of a floating production storage and offloading (FPSO) vessel down to asset subcomponents such as wind turbine blades creates large obtainable market opportunities. Based on the average monthly fee currently generated per connection or 3D digital twin, the Company estimates the current obtainable market opportunity to be approximately $24 billion in recurring revenue per annum including all potential targeted assets, workers, and 3D digital twins that the Company can currently address. Intangible Properties mCloud s success depends in part on its ability to create unique intellectual property that improves the Company s ability to create and deliver customer value in the principal markets where it does business. The Company relies on the use of intellectual property rights, including patents, copyrights, registered trademarks, and trade secrets in Canada, the United States and the European Union. The Company retains a portfolio of 15 technology patents in the areas of HVAC energy efficiency, 3D, and asset management, a global customer base in industries including retail, healthcare, heavy industry, oil and gas, nuclear power generation, and renewable energy, and a portfolio of 12 registered trademarks, including marks related to mCloud and AssetCare. Please see Our Business Intellectual Property . The Company also uses key domain names, including acrx.com, fdsi.site, fdsi.us, fielddiagnostics.com, fmdiagnosticscoe.com, mysamobile.com, peatanalytics.com, mcloudcorp.com, assetcare.io, assetcare.net, myldar.com, ngrain.com, ngrain.ca, ngrain.net, ngrain.org and i3dimensions.com. The Company further protects its proprietary source code and algorithms as trade secrets, limiting access to these to employees who have a need to know such information. Environmental Protection The Company does not see any financial or operational effects from environmental protection requirements on capital expenditures, profit or loss, and competitive position in this financial year. In the future, the Company may see enhanced demand for AssetCare in businesses who have a mandate to become more energy efficient or demonstrate they have instituted effective methane emission reduction and mitigation programs in response to new government regulations. Table of Contents TABLE OF CONTENTS Prospectus Summary 1
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001776932_medmen_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001776932_medmen_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001777946_ironnet_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001777946_ironnet_prospectus_summary.txt
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001781405_odyssey_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001781405_odyssey_prospectus_summary.txt
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+4 https://www.jpmorgan.com/global/research/electric-vehicles 44 Competition and Challenges There are many horizontal-conduction (meaning the current flows horizontally, along the surface of the wafer), high-electron-mobility transistor (HEMT) products emerging from industry. HEMT transistors are able to operate at higher frequencies than ordinary transistors, up to millimeter wave frequencies, and are used in high-frequency products such as cell phones, satellite television receivers, voltage converters, and radar equipment. However, horizontal-conduction device technology has difficulty scaling beyond 650 V. In contrast to horizontal-conduction devices, vertical-conduction (meaning the current flows from the top surface of the wafer to the bottom surface) devices could easily have scaling beyond 650 V; however, there are currently few discrete parts available with ratings above 650 V, and none above 1,000 V. The Company believes it is uniquely poised to enter into the >1,000 V device market and above with its vertical conduction device technology. Demonstration of Vertical Conduction 45 We expect that our competitors will include a number of larger companies, particularly in the SiC area (such as STMicro, WolfSpeed, Texas Instruments (TI), Infineon, On Semiconductor, and etc.) which have more substantial research and development budgets than us. Even smaller companies which are more targeted in their development efforts, such as Nexgen Power Systems, Inc., may be our potential competitors. If we are unable to compete effectively with our competitors, our products or technologies may be rendered obsolete or noncompetitive, which could materially adversely affect our business and results of operations. Intellectual Property The Company has two issued patents to date by the U.S. Patent and Trademark Office. In addition, the Company also currently has a number of additional patent applications pending. The Company is continuing to actively prepare and submit new patent applications based on its proprietary technology. Furthermore, the Company continues to perform research and development that will likely result in additional patent applications in the future. Research & Development, and Commercialization of Our Technology We perform research and development on GaN power switching devices as well as provide consulting services to third parties with regard to similar foundry processing which may involve materials other than GaN. We plan to meet the following milestones for the commercialization of our GaN technology: From inception to 2021: Continue developing medium to high voltage GaN-based vertical conduction devices Confirm specifications and packaging plans for samples of first product with customers Write and submit patent applications From 2022 Complete initial development of first GaN-based vertical conduction product Continue to write and submit patent applications Provide customers with engineering samples of first product Hire new CEO and develop sales and marketing capability Ship first GaN-based vertical conduction product to customers (fourth quarter of 2022) Start qualifications under qualified under Joint Electron Device Engineering Council ( JEDEC ) standards From 2023 Provide customers with engineering samples of second product Expand the production of the first product Ship second product 46 We plan to market our products in the following market verticals: Industrial motor drives: It is estimated that motor drives consume 45% of all power generated in the world.5 Energy consumption can be drastically reduced by using variable-frequency drives (VFDs) on induction motors. The compound annual growth rate (CAGR) of the VFD market is estimated to be 6.7% to 2025, by which year the market size of the market is estimated to be $33.1 billion.6 EV / HEV power systems: It is projected that electric vehicles will account for over 22% of all vehicle sales by 2030.7 We estimate that adoption of GaN-based drive systems could potentially increase efficiency by 15%. The CAGR of the EV power electronics market is estimated to be 4.48% from 2017-2022, and the market size is estimated to be $5.49 billion by 2022.8 Grid connected renewable power systems: Solar power accounted for 29% of all new electric generating capacity brought online in 2018.9 We believe that GaN-based power conversion systems will reduce system size and increase efficiency and reliability. The CAGR of the Photovoltaic (PV) power electronics market is estimated to be 3.9% by 2026 with a market share of $10.37 billion.10 The Company has incurred $1,519,631 in research expenses during the year ended December 31, 2021. Employees As of March 31, 2022, we had 12 full time employees and 1 part-time employee. No employees are subject to collective bargaining agreements. Principal Offices Our principal offices are located at 9 Brown Road, Ithaca, NY 14850. We lease one (1) 10,000 square foot facility in the State of New York for our operations. Our lease expires on November 30, 2025. MANAGEMENT Executive Officers and Directors All directors of the Company hold office for one-year terms until the election and qualification of their successors. Officers are appointed by our Board and serve at the discretion of the Board, subject to applicable employment agreements. The following table sets forth information regarding our executive officers and the members of our Board. 5 CleanTechnica. \Electric Motors Use 45% of Global Electricity, Europe Responding {+ Electric Motor Efficiency Infographic}, June 16, 2011. https://cleantechnica.com/2011/06/16/electric-motors-consume-45-of-global-electricity-europe-responding-electric-motor-efficiency-infographic/. 6https://www.grandviewresearch.com/industry-analysis/variable-frequency-speed-drives-vfd-vsd-market 7https://www.prnewswire.com/in/news-releases/electric-vehicles-market-sales-will-surge-to-4-million-units-in-2020-12-million-units-in-2025-and-21-million-units-in-2030-858019212.html 8 https://www.marketsandmarkets.com/Market-Reports/automotive-power-electronics-market-226516353.html 9 https://www.seia.org/research-resources/solar-market-insight-report-2018-q3 10 https://www.prnewswire.com/news-releases/pv-inverter-market-size-worth-10-37-billion-by-2026-cagr-3-9-grand-view-research-inc-300902312.html 47 Name Age Position Mark Davidson 49 Chief Executive Officer and Director Richard Brown 39 Chief Technical Officer and Director James Shealy 65 Secretary and Treasurer John Edmunds 64 Chairman of the Board and Director Richard Ogawa 59 Director Michael Thompson 64 Director Mark Davidson joined the Company as Chief Executive Officer as of April 18, 2022 and was appointed as a Director on April 26, 2022. From April 2020 to April 2022, Mr. Davidson served as the Chief Revenue Officer of DreamVu, Inc., a developer of omnidirectional 3D vision systems. From October 2019 to August 2020, Mr. Davidson was interim Chief Executive Officer of Range Networks Incorporated, a cellular network software company, where he pivoted the company s business model, resulting in a surge in revenue and profitability of the company and acquisition of the company by another fast-growing company. Since September 2018, Mr. Davidson has served as a managing partner of Vonzos Partners, a start-up venture capital company. From January 2016 to January 2018, Mr. Davidson served as Vice President and General Manager in the Global Power Products Business Organization of Intel Corporation, a semiconductor company, which acquired Altera Corporation, where Mr. Davidson served as General Manager and Marketing Director of The Power Business Unit from August 2013 to January 2016. From November 2007 to July 2013, he served as Texas Instruments Incorporated s Regional Sales and Applications Engineering Director as well as Analog Applications Manager. From November 2000 to October 2007, he served as National Semiconductor Corporation s Marketing Director and Product Line Director. From July 1997 to July 2000, Mr. Davidson served as Visteon Corporation s Customer Liaison Engineer and Country Manager. From May 1995 to July 1997, Mr. Davidson served as Ford Motor Company s Product Design Engineer. He received in 1995 a Bachelor of Science, Electrical Engineering from Pennsylvania State University. We believe that Mr. Davidson s years of experience in technology companies and the semiconductor industry, as well as his experience in serving as an officer in multiple start-up companies, qualify him to serve on our board of directors. Richard Brown joined the Company as Chief Executive Officer, Chairman and a Director on June 21, 2019. He resigned from the positions of Chief Executive Officer and Chairman, and was appointed as Chief Technical Officer of the Company as of March 11, 2020. He was appointed our Interim Chief Executive Officer on September 13, 2021. He received his B.S., M.S., and Ph.D. from Cornell University, all in Electrical and Computer Engineering in 2004, 2007, and 2010, respectively. His Ph.D. research was focused on advanced dielectrics for the passivation of microwave AlGaN/GaN HEMTs. After graduation, he was a founding member of the company that became Avogy, Inc., where he worked on the development of vertical GaN power devices for 2 years. Prior to the founding of Odyssey Semiconductor, Inc., the wholly-owned subsidiary of the Company, he co-owned JR2J, LLC, a semiconductor device prototyping business, as well as working as a visiting scientist at Cornell University researching GaN based HEMTs. Mr. Brown has over 18 years of semiconductor device experience, most of it specializing in topics relating to GaN devices. We believe that Mr. Brown s technical experience in the semiconductor industry and extensive knowledge of the Company from his various roles on the management team qualify him to serve on our board of directors. James Shealy has been Secretary and Treasurer of the Company since June 21, 2019. He is a co-founder of the Odyssey Semiconductor, Inc., the wholly-owned subsidiary of the Company, and JR2J. He received his BS from North Carolina State University in 1978, his M.S. from Rensselaer Polytechnic in 1980, and his Ph.D. from Cornell University in 1983. After earning his doctorate, Mr. Shealy held a dual appointment at Cornell University as a research associate and at General Electric as a principal staff scientist. In 1983 he co-founded, and has chaired, the biennial international workshop on OMVPE (organometallic vapor phase epitaxy), a technique used for growing semiconductor crystals. He joined the faculty in 1987 and is active in developing Cornell s laboratory research in compound semiconductor materials and related graduate courses. John Edmunds has been a Director and Chairman of the Audit Committee since June 22, 2021, and became Chairman of the Board since September 22, 2021. Since September 2021, Mr. Edmunds has been serving as the interim part-time Chief Financial Officer of Mythic Inc., a late stage private artificial intelligence semiconductor company in Redwood City, California. Mr. Edmunds served as Chief Financial Officer and Chief Accounting Officer of Inphi Corporation, a semiconductor component company, from January 2008 to April 2021 . He previously served as Chief Financial Officer of Trident Microsystems, a semiconductor company, from June 2004 to January 2008. Mr. Edmunds also served as Senior Vice President and Chief Financial Officer for Oak Technology, Inc. from January 2000 until it was acquired by Zoran Corporation in August 2003. He continued to serve as Vice President of Finance for Zoran until June 2004. Mr. Edmunds started his career as a C.P.A. with Coopers & Lybrand in San Francisco and San Jose in 1980s. He holds a B.S. degree in finance and accounting from the University of California, Berkeley. We believe that Mr. Edmunds financial experience qualifies him to be Chairman of our Audit Committee and that his financial and technical experience in the semiconductor industry and his leadership roles in other technology companies qualify him to serve on our board of directors. Richard Ogawa joined the Board of Directors of the Company on June 21, 2019 and joined our Audit Committee on June 22, 2021. Mr. Ogawa currently also serves on the board of directors of Amesite Inc., an SEC reporting company in the artificial intelligence software industry, since February 2018. He had been General Counsel at Inphi Corporation, a semiconductor component company, since Jan 2013, responsible for overseeing legal matters as well as corporate, intellectual property, and government affairs, until Inphi Corporation was acquired by Marvell Technology, Inc in April 2021. Mr. Ogawa is a Registered United States Patent Attorney and a Member of the California State Bar with more than 25 years of experience specializing in technology companies. Prior to Inphi, from January 1993 to January 2010, he was a Partner at Townsend and Townsend and Crew, a law firm focused on intellectual property. He is the founder and owner of Ogawa Professional Corporation, his own law firm, focusing on startup companies. Since February 2008, he has been General Counsel for Soraa Laser Diode, Inc., a venture funded company by Khosla Ventures and acquired by Kyocera Corporation in 2022. He also held a variety of engineering and management positions at NEC Electronics from December 1984 to December 1992. He received a B.S. in Chemical Engineering from the University of California, Davis in 1984, and a J.D. from McGeorge George School of Law, University of the Pacific in 1991. We believe that Mr. Ogawa s many years of legal expertise in technology companies qualifies him to serve on our board of directors and Audit Committee. 48 Michael Thompson joined the Board of Directors of the Company on June 21, 2019. He received his B.S. in Applied Physics from CalTech in 1979 and M.S./Ph.D. degrees in Applied and Engineering Physics from Cornell in 1984. After completing his Ph.D, he joined the faculty in the Department of Materials Science at Cornell University continuing his work on the interaction of materials with intense laser sources. He has co-authored over 100 journal publications, is co-inventor on 25 patents, and has founded or co-founded three startup companies. He was the recipient of the 2009 SEMI Award for technical contributions to the semiconductor industry. For the past 28 years, Dr. Thompson s research has focused extensively on the behavior of semiconductor materials under pulsed and continuous-wave laser exposure. In the late 1990 s, he was involved in the development of melt-annealing methods to fabricate thin-film transistors on glass and flexible substrates. Over the past decade, he helped to develop the use of CW lasers for non-melt laser annealing (LSA Laser Spike Annealing) of ultra-shallow junctions in advanced VLSI nodes. His group currently is active in exploring new applications for LSA both within and beyond the microelectronics community. Areas of research include dopant activation and deactivation in compound semiconductors (InGaAs, GaN, GaO2), thin-film amorphous oxide semiconductors (IGZO), metastable phase formation in metallic glasses and complex oxides during LSA quench, mesoscale structuring of organic and inorganic materials in the millisecond timescale, and development of novel processes for EUV and DSA lithography. He is also currently the director of the ACCESS (AFRL Cornell Center for Epitaxial SolutionS) center focused on understanding fundamental materials issues in GaO2 power devices. We believe that Mr. Thompson s extensive technical experience in the semiconductor industry qualifies him to serve on our board of directors. Advisory Board Member Name Age Position Khurram Khan Afridi 55 Advisory Board Member Khurram Khan Afridi was appointed as an Advisory Board Member of the Company as of June 7, 2021. Mr. Afridi is an Associate Professor of Electrical and Computer Engineering at Cornell University. He received a Bachelor of Science degree in electrical engineering from California Institute of Technology (1989), and Master of Science (1992) and PhD (1998) degrees in electrical engineering and computer science from Massachusetts Institute of Technology (MIT). His research interests are in power electronics and energy systems incorporating power electronic controls. Prior to joining Cornell, he was an Assistant Professor and the Goh Faculty Fellow at the University of Colorado (CU) Boulder (2014-2018), a visiting faculty at MIT s EECS Department (2009-2014), and the Chief Operating Officer (2000-2010) and Chief Technology Officer (1997-2000) of Techlogix, Inc.. From 2004 to 2008 he led the development of LUMS School of Science and Engineering (SSE) as Project Director. He has also worked for the NASA Jet Propulsion Laboratory, Lutron Electrronics Co., Koninklijke Philips N.V (Philips), and Schlumberger Limited. He is an associate editor of the IEEE Journal of Emerging and Selected Topics in Power Electronics, and was the Technical Program Committee (TPC) chair for the IEEE Wireless Power Transfer Conference (WPTC) in 2015. He received the Carnation Merit Award from Caltech (1988), the BMW Scientific Award from BMW AG (1999), the Werner-von-Siemens Chair for Power Electronics from LUMS SSE (2008), the Dean s Professional Progress Award from CU Boulder (2015), the ECEE Department Outstanding Overall Performance Award from CU Boulder (2016), and the National Science Foundation CAREER Award from NSF (2016). He is co-author of five IEEE prize papers. 49 Significant Employee In addition to the officers, directors and an advisory board member disclosed above, the Company also has the following significant employee: Name Age Position Alfred Schremer 64 Vice President of Research and Development Alfred Schremer has 40 years of experience working in the field III-V semiconductors with applications in RF- and opto-electronics. He earned his PhD in Electrical Engineering from Cornell University, investigating various aspects of semiconductor laser physics, using lasers he fabricated from epitaxial materials he grew using facilities within the School of Electrical Engineering. He joined BinOptics Corporation, a manufacturer of optoelectronic components, at its inception in 2001, serving in various roles from Lab Manager to Director of Research, refining the etched facet laser processes which led to the enabling of low-cost wafer scale manufacturing of Fabry-Perot and distributed feedback lasers for the data and telecom markets. In December 2014, BinOptics was acquired by MACOM Technology Solutions Inc., a developer and producer of radio, microwave, and millimeter wave semiconductor devices and components, where Mr. Schremer served until April 2019 as a Director of Engineering, supporting manufacturing and development of etched facet lasers. Employment and Consulting Agreements On July 1, 2019, through its wholly-owned subsidiary, Odyssey Semiconductor, the Company entered into an agreement with Al Schremer as Vice President of Research and Development. Pursuant to the agreement, the Company agreed to pay Mr. Schremer an annual salary of $100,000 and a one-time grant of options to purchase 100,000 shares of the Company s Common Stock. On April 7, 2022, the Company entered into a letter agreement with Mark Davidson as Chief Executive Officer of the Company effective as of April 18, 2022. Pursuant to the agreement, the Company agreed to pay Mr. Davidson an annual base salary of $300,000. For 2022, Mr. Davidson will be eligible for an annual target bonus of up to $150,000 that will be prorated for nine (9) months (i.e. $112,500) based on his achievements of performance goals to be finalized and approved by the Board within the first two months of his employment. Such annual bonus will be paid in stock compensation until such time that the Company has sufficient cash flow. His eligibility for future bonuses will be determined by the Board in accordance with the Company s future bonus plans and programs. In addition, the Company agreed to grant to Mr. Davidson an option to purchase 650,000 shares of common stock of the Company at $1.66 per share, which will vest starting from April 26, 2023, in four annual equal installments. The option will be subject to acceleration in vesting in connection with the occurrence of a change of control event during the term of Mr. Davidson s employment. Other than Mr. Schremer and Mr. Davidson, we have not entered into any other employment agreement with our management or significant employees. On April 1, 2019, JR2J, our indirect wholly-owned subsidiary, entered into a one-year independent contractor agreement with Richard Ogawa, pursuant to which Mr. Ogawa agreed to serve as a director of the Company post-Share Exchange, and provide services related to intellectual property development, intellectual property strategies and licensing of intellectual property. This Agreement automatically renews for additional terms of one-year unless terminated in accordance with the Agreement. In consideration for Mr. Ogawa s services to the Company, on September 25, 2019, the Company granted Mr. Ogawa a 10-year option under the 2019 Plan to purchase 275,000 shares of Common Stock at a price of $1.50 per share, half of which vested on September 25, 2020 and the balance of which vested on September 25, 2021. On May 16, 2019, Odyssey Semiconductor, our wholly-owned subsidiary, entered into a one-year independent contractor agreement with Alex Behfar, pursuant to which Mr. Behfar agreed to serve as a director of the Company post-Share Exchange, and provide services related to corporate development and business strategy, and intellectual property strategies. In consideration for Mr. Behfar s services to the Company, on September 25, 2019, the Company granted Mr. Behfar a 10-year option under the 2019 Plan to purchase 50,000 shares of Common Stock at a price of $1.50 per share, half of which vested on September 25, 2020 and the balance of which vested on September 22, 2021. Mr. Behar was appointed Chief Executive Officer on September 16, 2020. Mr. Behfar tendered his resignation as Chief Executive Officer, Chairman of the Board of Directors and Director of the Company, effective as of September 22, 2021. On June 7, 2021, Khurram Khan Afridi was appointed as an Advisory Board Member to bring his extensive expertise in power systems to the Company and work with the Company in setting up the expectations from customers in areas such as electric vehicles and solar energy. Mr. Afridi agreed to be at the facility of the Company for one hour per week. In connection with such appointment, Mr. Afridi was granted 10-year options to purchase 50,000 shares of Common Stock at a price of $3.55 per share. In connection with John Edmunds s appointment as a Director and Chairman of Audit Committee of the Company on June 22, 2021, the Company agreed to pay Mr. Edmunds (i) an annual cash compensation of $20,000; (ii) a one-time grant on June 22, 2021 of non-qualified stock options under the Company 2019 Equity Compensation Plan to purchase 70,246 shares of Common Stock of the Company at $2.90 per share; (iii) an annual grant of non-qualified stock options under the 2019 Plan to purchase a number of shares of common stock of the Corporation that have a value of $60,000, calculated using the fair market value of Common Stock of the Company as determined by the Board as of the date of grant, with an exercise price equal to the closing bid price of Common Stock of the Company as of the date of grant; provided that Mr. Edmunds shall have served on the Board for at least six months prior to the date of grant; and (iv) reimbursement for reasonable out-of-pocket costs and travel expenses in connection with his attendance at meetings of the Board and Audit Committee. 50 Legal Proceedings There are no outstanding lawsuits or judgments against the Company or any consent decrees or injunctions to which the Company is subject or by which any of its assets are bound and there are no claims, proceedings, actions or lawsuits in existence, or to our knowledge threatened or asserted, against the Company or with respect to any of its assets that would materially and adversely affect the business, property or financial condition of the Company. Corporate Governance The Board s Role in Risk Oversight The board of directors oversees that the assets of our company are properly safeguarded, that the appropriate financial and other controls are maintained, and that our business is conducted wisely and in compliance with applicable laws and regulations and proper governance. Included in these responsibilities is the board s oversight of the various risks facing our company. In this regard, our board seeks to understand and oversee critical business risks. Our board does not view risk in isolation. Risks are considered in virtually every business decision and as part of our business strategy. Our board recognizes that it is neither possible nor prudent to eliminate all risk. Indeed, purposeful and appropriate risk-taking is essential for our company to be competitive on a global basis and to achieve its objectives. While the board oversees risk management, company management is charged with managing risk. Management communicates routinely with the board and individual directors on the significant risks identified and how they are being managed. Directors are free to, and indeed often do, communicate directly with senior management. Our board administers its risk oversight function as a whole by making risk oversight a matter of collective consideration. Much of this work has been delegated to committees, which will meet regularly and report back to the full board. The audit committee oversees risks related to our financial statements, the financial reporting process, accounting and legal matters, the compensation committee evaluates the risks and rewards associated with our compensation philosophy and programs, and the nominating and corporate governance committee evaluates risk associated with management decisions and strategic direction. Independent Directors Nasdaq s rules generally require that a majority of an issuer s board of directors must consist of independent directors. Our board of directors currently consists of five (5) directors, of which John Edmunds, Richard Ogawa and Michael Thompson are independent within the meaning of Nasdaq s rules. 51 Committees of the Board of Directors Our board has established an audit committee with its own charter approved by the board. The board has also approved the establishment of a compensation committee and a nominating and corporate governance committee, each with its own charter approved by the board, to be effective as of the effective date of the registration statement of which this prospectus is a part. The committee charters have been filed as exhibits to the registration statement of which this prospectus is a part. Upon completion of this offering, we intend to make each committee s charter available on our website at https://www.odysseysemi.com/. In addition, our board of directors may, from time to time, designate one or more additional committees, which shall have the duties and powers granted to it by our board of directors. Audit Committee John Edmunds and Michael Thompson, each of whom satisfies the independence requirements of Rule 10A-3 under the Exchange Act and Nasdaq s rules. Mr. Edmunds currently serves on our audit committee as a member and the chairman. The board has also approved the appointment of Mr. Thompson on our audit committee, to be effective as of the effective date of the registration statement of which this prospectus is a part. Our board has determined that Mr. Edmunds qualifies as an audit committee financial expert. The audit committee oversees our accounting and financial reporting processes and the audits of the financial statements of our company. The audit committee is responsible for, among other things: (i) retaining and overseeing our independent accountants; (ii) assisting the board in its oversight of the integrity of our financial statements, the qualifications, independence and performance of our independent auditors and our compliance with legal and regulatory requirements; (iii) reviewing and approving the plan and scope of the internal and external audit; (iv) pre-approving any audit and non-audit services provided by our independent auditors; (v) approving the fees to be paid to our independent auditors; (vi) reviewing with our chief executive officer and principal financial officer and independent auditors the adequacy and effectiveness of our internal controls; (vii) reviewing hedging transactions; and (viii) reviewing and assessing annually the audit committee s performance and the adequacy of its charter. Compensation Committee John Edmunds and Michael Thompson, each of whom satisfies the independence requirements of Rule 10C-1 under the Exchange Act and Nasdaq s rules, will serve on our compensation committee to be effective as of the effective date of the registration statement of which this prospectus is a part, with Mr. Edmunds serving as the chairman. The members of the compensation committee are also outside directors as defined in Section 162(m) of the Internal Revenue Code of 1986, as amended, or the Code, and non-employee directors within the meaning of Section 16 of the Exchange Act. The compensation committee assists the board in reviewing and approving the compensation structure, including all forms of compensation, relating to our directors and executive officers. The compensation committee is responsible for, among other things: (i) reviewing and approving the remuneration of our executive officers; (ii) making recommendations to the board regarding the compensation of our independent directors; (iii) making recommendations to the board regarding equity-based and incentive compensation plans, policies and programs; and (iv) reviewing and assessing annually the compensation committee s performance and the adequacy of its charter. The charter of the compensation committee has been adopted by the board, to be effective as of the effective date of the registration statement of which this prospectus is a part. Nominating and Corporate Governance Committee Richard Ogawa and John Edmunds, each of whom satisfies the independence requirements of Nasdaq s rules, will serve on our nominating and corporate governance committee, with Mr. Ogawa serving as the chairman. The nominating and corporate governance committee assists the board of directors in selecting individuals qualified to become our directors and in determining the composition of the board and its committees. The nominating and corporate governance committee will be responsible for, among other things: (i) identifying and evaluating individuals qualified to become members of the board by reviewing nominees for election to the board submitted by shareholders and recommending to the board director nominees for each annual meeting of shareholders and for election to fill any vacancies on the board; (ii) advising the board with respect to board organization, desired qualifications of board members, the membership, function, operation, structure and composition of committees (including any committee authority to delegate to subcommittees), and self-evaluation and policies; (iii) advising on matters relating to corporate governance and monitoring developments in the law and practice of corporate governance; (iv) overseeing compliance with the our code of business conduct; and (v) approving any related party transactions. The charter of the nominating and corporate governance committee has been adopted by the board, to be effective as of the effective date of the registration statement of which this prospectus is a part. 52 The nominating and corporate governance committee s methods for identifying candidates for election to our board of directors (other than those proposed by our shareholders, as discussed below) will include the solicitation of ideas for possible candidates from a number of sources, including members of our board of directors, our executives, individuals personally known to the members of our board of directors, and other research. The nominating and corporate governance committee may also, from time-to-time, retain one or more third-party search firms to identify suitable candidates. In making director recommendations, the nominating and corporate governance committee may consider some or all of the following factors: (i) the candidate s judgment, skill, experience with other organizations of comparable purpose, complexity and size, and subject to similar legal restrictions and oversight; (ii) the interplay of the candidate s experience with the experience of other board members; (iii) the extent to which the candidate would be a desirable addition to the board and any committee thereof; (iv) whether or not the person has any relationships that might impair his or her independence; and (v) the candidate s ability to contribute to the effective management of our company, taking into account the needs of our company and such factors as the individual s experience, perspective, skills and knowledge of the industry in which we operate. A shareholder may nominate one or more persons for election as a director at an annual meeting of shareholders if the shareholder complies with the notice and information provisions contained in our bylaws. Such notice must be in writing to our Company not later than the close of business on the ninetieth (90th) day nor earlier than the close of business on the one-hundred-twentieth (120th) day prior to the first anniversary of the preceding year s annual meeting; provided, however, that in the event that the date of the annual meeting is advanced more than thirty (30) days prior to or delayed by more than thirty (30) days after the anniversary of the preceding year s annual meeting, notice by the stockholder to be timely must be so delivered not earlier than the close of business on the one hundred twentieth (120th) day prior to such annual meeting and not later than the close of business on the later of the ninetieth (90th) day prior to such annual meeting or the tenth (10th) day following the day on which public announcement of the date of such meeting is first made or as otherwise required by the Exchange Act. In addition, shareholders furnishing such notice must be a holder of record on both (i) the date of delivering such notice and (ii) the record date for the determination of shareholders entitled to vote at such meeting. Code of Business Conduct We have adopted a code of business conduct that applies to all of our directors, officers and employees. Such code of business conduct addresses, among other things, honesty and ethical conduct, conflicts of interest, compliance with laws, regulations and policies, including disclosure requirements under the federal securities laws, and reporting of violations of the code. A copy of the code of business conduct has been filed as an exhibit to the registration statement of which this prospectus is a part. We are required to disclose any amendment to, or waiver from, a provision of our code of business conduct applicable to our principal executive officer, principal financial officer, principal accounting officer, controller, or persons performing similar functions. We intend to use our website as a method of disseminating this disclosure as well as by SEC filings, as permitted or required by applicable SEC rules. Any such disclosure will be posted to our website within four (4) business days following the date of any such amendment to, or waiver from, a provision of our code of business conduct. EXECUTIVE COMPENSATION Summary Compensation Table The following table presents information regarding the total compensation awarded to, earned by, or paid to our chief executive officer and the other most highly-compensated executive officers (other than the chief executive officer) who were serving as executive officers during the years ended December 31, 2021 and 2020. 53 Name and Principal Position Year Salary ($) Bonus ($) Option Awards ($)(3) Non-equity incentive plan compensation ($) Nonqualified deferred compensation earnings ($) All Other Compensation ($) Total ($) Alex Behfar (1) 2021 10 0 0 0 0 0 10 Former Chairman and Former Chief Executive Officer 2020 10 0 4,406,125 0 0 0 4,406,135 Richard J. Brown (2) 2021 150,000 0 137,295 0 0 0 287,295 Former Interim Chief Executive Officer and Chief Technical Officer 2020 150,000 0 0 0 0 0 150,000 James R. Shealy 2021 60,000 0 109,836 0 0 0 169,836 Secretary and Treasurer 2020 55,625 0 0 0 0 0 55,625 (1) Mr. Behfar was appointed as the Company s Acting Chief Executive Officer and Executive Chairman on March 11, 2020, and as Chief Executive Officer and Chairman on September 16, 2020. Mr. Behfar tendered his resignation as Chief Executive Officer, Chairman of the Board of Directors and Director of the Company, effective as of September 22, 2021. This table includes compensation paid to Mr. Behfar from January 1, 2020 to March 11, 2020 as a non-employee director, and for the remainder of 2020 as an executive officer and director. Mr. Behfar received $10.00 cash compensation earned in 2020. Starting January 1, 2021 until his resignation on September 22, 2021, he received a cash compensation of $1.00 per month. (2) Mr. Brown was Chief Executive Officer and Chairman of the Company from June 21, 2019 to March 11, 2020, Chief Technical Officer since March 11, 2020, and also Interim Chief Executive Officer from September 13, 2021.to April 18, 2022. (3) The amounts reported in the Option Awards column reflect the aggregate fair value of stock-based compensation awarded during the year computed in accordance with the provisions of FASB ASC Topic 718. 2019 Equity Compensation Plan General On June 18, 2019, our Board of Directors adopted an Equity Compensation Plan (the 2019 Plan ). The 2019 Plan was approved by the stockholders on the same day. On May 26, 2020, the Board of Directors and a majority of the Company s shareholders approved an amendment to the 2019 Plan to (i) increase the number of shares of Common Stock authorized for issuance under the 2019 Plan from 1,326,000 to 2,500,000 shares; (ii) increase the maximum aggregate number of shares, options and/or other awards that may be granted to any one person during any calendar year from 500,000 to 1,300,000; and (iii) clarify the availability of cashless exercise as a form of consideration. On September 16, 2020, the Board of Directors and a majority of the Company s shareholders approved the second amendment to the 2019 Plan to (i) increase the number of shares of Common Stock authorized for issuance under the 2019 Plan from 2,500,000 to 4,600,000; (ii) increase the maximum aggregate number of shares, options and/or other awards that may be granted to any one person during any calendar year from 1,300,000 to 2,950,000. On February 9, 2022, subject to the shareholders approval, our Board of Directors approved that the aggregate number of shares authorized for issuance as awards under the 2019 Plan shall be 4,600,000 shares plus an annual increase on the first day of each fiscal year for the rest of the term of the Plan in an amount equal to the lesser of (i) 5% of the outstanding shares of common stock of the Company on the last day of the immediately preceding year or (ii) an amount determined by the Board. 54 As of the date hereof, a total of 5,010,656 options have been granted under the 2019 Plan, of which 2,048,246 options are outstanding, 315,625 options have been exercised. There are 2,236,129 shares, including 1,911,160 forfeited and 735,625 expired options, which are available to be issued in the future under the 2019 Plan. The general purpose of the 2019 Plan is to provide an incentive to our employees, directors, consultants and advisors by enabling them to share in the future growth of our business. Our Board of Directors believes that the granting of stock options, restricted stock awards, unrestricted stock awards and similar kinds of equity-based compensation promotes continuity of management and increases incentive and personal interest in the welfare of our Company by those who are primarily responsible for shaping and carrying out our long range plans and securing our growth and financial success. Our Board of Directors believes that the 2019 Plan will advance our interests by enhancing our ability to (a) attract and retain employees, consultants, directors and advisors who are in a position to make significant contributions to our success; (b) reward our employees, consultants, directors and advisors for these contributions; and (c) encourage employees, consultants, directors and advisors to take into account our long-term interests through ownership of our shares. Description of the 2019 Equity Compensation Plan The following description of the principal terms of the 2019 Plan, as amended, is a summary and is qualified in its entirety by the full text of the amended 2019 Plan, which was filed as an exhibit to our Annual Report on Form 10-K for the year ended December 31, 2020 filed on April 8, 2021. Administration. The 2019 Plan will be administered by our Board of Directors. Our Board of Directors may grant options to purchase shares of our Common Stock, stock appreciation rights, restricted stock units, restricted or unrestricted shares of our Common Stock, performance shares, performance units, other cash-based awards and other stock-based awards. The Board of Directors also has broad authority to determine the terms and conditions of each option or other kind of equity award, adopt, amend and rescind rules and regulations for the administration of the 2019 Plan and amend or modify outstanding options, grants and awards. Eligibility. Persons eligible to receive options, stock appreciation rights or other awards under the 2019 Plan are employees, consultants, advisors and directors of our Company and our subsidiaries. As of the date hereof, 12 full-time employees, one part-time employee, and two non-employee directors are eligible to participate in the 2019 Plan. The Board of Directors may at any time and from time to time grant awards under the 2019 Plan to eligible persons on a discretionary basis. Shares Subject to the 2019 Plan. The aggregate number of shares of Common Stock available for issuance in connection with options and awards granted under the 2019 Plan, as amended, is 4,600,000, subject to customary adjustments for stock splits, stock dividends or similar transactions. Incentive Stock Options may be granted under the 2019 Plan with respect to all of those shares. If any option or stock appreciation right granted under the 2019 Plan terminates without having been exercised in full or if any award is forfeited, or if shares of Common Stock are withheld to cover withholding taxes on options or other awards, the number of shares of Common Stock as to which such option or award was forfeited, or which were withheld, will be available for future grants under the 2019 Plan. The maximum aggregate number of shares of Common Stock with respect to one or more awards that may be granted to any employee, director or consultant during any calendar year shall be 2,950,000 and the maximum aggregate amount of cash that may be paid in cash during any calendar year with respect to one or more awards payable in cash shall be $200,000. Terms and Conditions of Options. Options granted under the 2019 Plan may be either incentive stock options that are intended to meet the requirements of Section 422 of the Internal Revenue Code of 1986, as amended (the Code ) or nonstatutory stock options that do not meet the requirements of Section 422 of the Code. Incentive stock options may be granted only to employees. Each option grant will be evidenced by an award agreement that will specify the terms and conditions as determined by the Board of Directors. The Board of Directors will determine the exercise price of options granted under the 2019 Plan. The exercise price of stock options may not be less than the fair market value, on the date of grant, per share of our Common Stock issuable upon exercise of the option (or 110% of fair market value in the case of incentive options granted to a ten-percent stockholder). 55 If on the date of grant the Common Stock is listed on a stock exchange or is quoted on the automated quotation system of Nasdaq, the fair market value shall generally be the closing sale price on the last trading day before the date of grant. If no such prices are available, the fair market value shall be determined in good faith by the Board of Directors based on the advice of a qualified valuation expert. No option may be exercisable for more than ten years (five years in the case of an incentive stock option granted to a ten-percent stockholder) from the date of grant. Options granted under the 2019 Plan will be exercisable at such time or times as the Board of Directors prescribes at the time of grant. No employee may receive incentive stock options that first become exercisable in any calendar year in an amount exceeding $100,000. Generally, the option price may be paid (a) in cash or by bank check, (b) through delivery of shares of our Common Stock having a fair market value equal to the purchase price, (c) through cashless exercise, or (d) a combination of these methods. No option may be transferred other than by will or by the laws of descent and distribution, and during a recipient s lifetime an option may be exercised only by the recipient. Options granted under the 2019 Plan will be exercisable at such time or times as the Board of Directors prescribes at the time of grant. No employee may receive incentive stock options that first become exercisable in any calendar year in an amount exceeding $100,000. Stock Appreciation Rights. The Board of Directors may grant stock appreciation rights under the 2019 Plan in such amounts as the Board of Directors in its sole discretion will determine. Each stock appreciation right grant will be evidenced by an award agreement that will specify the terms and conditions as determined by the Board of Directors. The exercise price per share of a stock appreciation right will be determined by the Board of Directors, but will not be less than 100% of the fair market value of a share of our Common Stock on the date of grant. The maximum term of any SAR granted under the 2019 Plan is ten years from the date of grant. Generally, each SAR stock appreciation right will entitle a participant upon exercise to an amount equal to: the excess of the fair market value on the exercise date of one share of our Common Stock over the exercise price, multiplied by the number of shares of Common Stock covered by the stock appreciation right. Payment may be made in shares of our Common Stock, in cash, or partly in Common Stock and partly in cash, all as determined by the Board of Directors. Restricted Stock and Restricted Stock Units. The Board of Directors may award restricted common stock and/or restricted stock units under the 2019 Plan in such amounts as the Board of Directors in its sole discretion will determine. The Board of Directors will determine the restrictions and conditions applicable to each award of restricted stock or restricted stock units, as evidenced in an award agreement, which may include performance-based conditions. Dividends and other distributions with respect to restricted stock may be paid to the holder of the shares as and when dividends are paid to stockholders, unless otherwise provided in the award agreement. Unless the Board of Directors determines otherwise, holders of restricted stock will have the right to vote the shares. Performance Shares and Performance Units. The Board of Directors may award performance shares and/or performance units under the 2019 Plan in such amounts as the Board of Directors in its sole discretion will determine. Each performance unit will have an initial value that is established by the Board of Directors on or before the date of grant. Each performance share will have an initial value equal to the fair market value of a share on the date of grant. The Board of Directors at its discretion will set performance objectives or other vesting provisions. The Board of Directors will determine the restrictions and conditions applicable to each award of performance shares and performance units, as evidenced in an award agreement. Effect of Certain Corporate Transactions. In the event of a change in control (as defined in the 2019 Plan), the Board of Directors has the discretion and without the need for the consent of any recipient of an award to take the following actions as to an outstanding award: (i) awards will be assumed, or substantially equivalent awards will be substituted, by the acquiring or succeeding corporation; (ii) awards will terminate upon or immediately prior to the consummation of such change in control; (iii) outstanding awards will vest and become exercisable, or restrictions applicable to an award will lapse, in whole or in part prior to or upon consummation of such change in control, and terminate upon or immediately prior to the effectiveness of such change in control; (iv) an award is terminated in exchange for an amount of cash and/or property, if any, equal to the amount that would have been attained upon the exercise of such award; (v) an award is replaced with other rights or property selected by the Board of Directors in its sole discretion; or (vi) any combination of the foregoing. 56 Amendment, Termination. The Board of Directors may at any time amend, alter, amend the terms of awards in any manner not inconsistent with the 2019 Plan, provided that no amendment shall adversely affect the rights of a participant with respect to an outstanding award without the participant s consent. In addition, our board of directors may at any time amend, suspend, or terminate the 2019 Plan, provided that (i) no such amendment, suspension or termination shall materially and adversely affect the rights of any participant under any outstanding award without the consent of such participant and (ii) to the extent necessary to comply with any applicable law or stock exchange rule, the Company will obtain stockholder consent of amendment to the plan. Tax Withholding As and when appropriate, we have the right to require each optionee purchasing shares of Common Stock and each grantee receiving an award of shares of Common Stock under the 2019 Plan to pay any federal, state or local taxes required by law to be withheld. Outstanding Equity Awards at Fiscal Year-End The following table presents information regarding the outstanding options held by each of our directors and named executive officers as of December 31, 2021. None of our directors or named executive officers held any outstanding restricted stock unit or other equity awards as of December 31, 2021. Option Awards Number of Securities Underlying Unexercised Options Name Grant Date Exercisable (#) Unexercisable (#) Exercise price ($) Expiration Date Richard Ogawa 9/25/2019 275,000 $1.50 9/25/2029 Michael Thompson 11/5/2019 25,000 $1.50 11/5/2029 James Shealy 11/5/2019 11,583 18,417 $1.50 11/5/2024 Richard Ogawa 5/30/2021 50,000 $3.93 5/30/2031 Michael Thompson 5/30/2021 50,000 $3.93 5/30/2031 John Edmunds 6/16/2021 70,246 $2.90 6/16/2031 Richard Ogawa 12/30/2021 2,500 17,500 $1.77 12/30/2031 Michael Thompson 12/30/2021 2,500 17,500 $1.77 12/30/2031 John Edmunds 12/30/2021 2,500 17,500 $1.77 12/30/2031 Richard Ogawa 12/30/2021 2,917 32,083 $1.77 12/30/2031 John Edmunds 12/30/2021 1,667 18,333 $1.77 12/30/2031 Richard Brown 12/30/2021 100,000 $1.77 12/30/2026 James Shealy 12/30/2021 80,000 $1.77 12/30/2026 total 323,667 471,579 57 After December 31, 2021, the Board granted on April 26, 2022 an option to Mark Davidson to purchase 650,000 shares of common stock at $1.66 per share, which will vest starting from April 26, 2023, in four annual equal installments. The grant of options and other awards under the 2019 Plan is discretionary, and we cannot determine now the specific number or type of options or awards to be granted in the future to any particular person or group. Director Compensation The table below shows the compensation paid to our directors during the years ended December 31, 2021 and 2020. Name Year Fees Earned or Paid in Cash Option Awards(2) Total John Edmunds(1) 2021 $ $ 196,428 $196,428 2020 $ $ $ Richard Ogawa 2021 $ $ 216,195 $216,195 2020 $ $ $ Michael Thompson 2021 $ $ 159,449 $159,449 2020 $ $ $ (1)John Edmunds was appointed onto the Board on June 22, 2021. He was not a director of the Company during 2020. (2)The amounts reported in the Option Awards column reflect the aggregate fair value of stock-based compensation awarded during the year computed in accordance with the provisions of FASB ASC Topic 718. On April 1, 2019, JR2J, our indirect wholly-owned subsidiary, entered into a one-year independent contractor agreement with Richard Ogawa, pursuant to which Mr. Ogawa agreed to provide services related to intellectual property development, intellectual property strategies and licensing of intellectual property. This Agreement automatically renews for additional terms of one-year unless terminated in accordance with the Agreement. In consideration for Mr. Ogawa s services to the Company, on September 25, 2019, the Company granted Mr. Ogawa a 10-year option under the 2019 Plan to purchase 275,000 shares of Common Stock at a price of $1.50 per share, half of which vested on September 25, 2020 and the balance of which vested on September 25, 2021. In connection with John Edmunds appointment as a Director and Chairman of Audit Committee of the Company on June 22, 2021, we have agreed to pay Mr. Edmunds (i) an annual cash compensation of $20,000; (ii) a one-time grant on June 22, 2021 of non-qualified stock options under the Company 2019 Equity Compensation Plan to purchase 70,246 shares of Common Stock of the Company at $2.90 per share; (iii) an annual grant of non-qualified stock options under the 2019 Plan to purchase a number of shares of Common Stock of the Corporation that have a value of $60,000, calculated using the fair market value of Common Stock of the Company as determined by the Board as of the date of grant, with an exercise price equal to the closing bid price of Common Stock of the Company as of the date of grant; provided that Mr. Edmunds shall have served on the Board for at least six months prior to the date of grant; and (iv) reimbursement for reasonable out-of-pocket costs and travel expenses in connection with his attendance at meetings of the Board and Audit Committee. Other than the above-mentioned cash compensation paid to Mr. Edmunds as Chairman of the Board and Chairman of Audit Committee of the Company, our non-employee directors do not receive any cash compensation for serving on the Board of the Company. During the year ended December 31, 2020, our non-employee directors did not receive any option grants. During the year ended December 31, 2021, the Company granted the following options to our non-employee directors: (i) on June 2, 2021, 10-year non-qualified stock options to purchase 50,000 shares of Common Stock at a price of $3.93 per share to each of Richard Ogawa and Michael Thompson; (ii) on December 30, 2021, 10-year non-qualified stock options to purchase 20,000 shares of Common Stock at a price of $1.77 per share to each of John Edmunds, Richard Ogawa and Michael Thompson; and (iii) on December 30, 2021, 10-year non-qualified stock options to purchase 20,000 shares and 35,000 shares of Common Stock at a price of $1.77 per share to John Edmunds (for providing service to the Company as Chairman of the Board) and Richard Ogawa, respectively. 58 In addition, we have agreed to reimburse the directors of travel and other expenses in connection with their performance of duties as directors of the Company. Other than disclosed above, we do not have other agreements or arrangements with our non-employee directors to compensate them for serving on our board. PRINCIPAL STOCKHOLDERS The following table sets forth the number of shares of Common Stock beneficially owned as of June 21, 2022 by: each of our named executive officers; each of our directors; all of our directors and current executive officers as a group; and each of our stockholders who is known by us to beneficially own more than 5% of our Common Stock Beneficial ownership is determined based on the rules and regulations of the Commission. A person has beneficial ownership of shares if such individual has the power to vote and/or dispose of shares. This power may be sole or shared and direct or indirect. Applicable percentage ownership in the following table is based on the total of 12,726,911 shares of Common Stock issued and outstanding as of the date hereof. In computing the number of shares beneficially owned by a person and the percentage ownership of that person, shares of Common Stock that are subject to options or warrants held by that person and exercisable as of, or within 60 days hereof. These shares, however, are not counted as outstanding for the purposes of computing the percentage ownership of any other person(s). Except as may be indicated in the footnotes to this table and pursuant to applicable community property laws, each person named in the table has sole voting and dispositive power with respect to the shares of Common Stock set forth opposite that person s name. Unless indicated below, the address of each individual listed below is c/o Odyssey Semiconductor Technologies, Inc., 9 Brown Road, Ithaca, NY 14850. Common Stock Beneficially Owned Prior to this Offering(1) Common Stock Beneficially Owned After this Offering Name and Address of Beneficial Owner Amount and Nature of Beneficial Ownership Percent of class Amount and Nature of Beneficial Ownership Percent of class Mark Davidson, Chief Executive Officer and Director (1) Richard J. Brown, Chief Technical Officer and Director 2,731,251(2) 21.46 2,731,251 [ ] James R. Shealy, Secretary and Treasurer 2,743,750(3) 21.56 2,743,750 [ ] John Edmunds, Chairman of the Board and Director 158,585(4) 1.24 17,085 [ ] Richard Ogawa, Director 328,335(5) 2.52 328,335 [ ] Michael Thompson, Director 30,000(6) * 30,000 [ ] All Executive Officers and Directors (6 persons) 5,991,921 47.08 5,991,921 [ ] Greater than 5% Stockholders [ ] Mark Tompkins 2,816,033(7) 22.13 2,816,033 [ ] * Less than 1%. 59 (1) Does not include the unvested options to purchase 650,000 shares at $1.66 per share, which were granted by the Board on April 26, 2022. The options will vest starting from April 26, 2023, in four annual equal installments. (2) Includes (i) 2,658,334 shares of Common Stock issued in connection with the Share Exchange; (ii) 66,667 shares of Common Stock purchased at a private placement in June 2019; and (iii) 6,250 shares of Common Stock purchased at a private placement in March 2021. (3) Includes (i) 2,658,333 shares of Common Stock issued in connection with the Share Exchange; (ii) 66,667 shares of Common Stock purchased at a private placement in June 2019; and (iii) 18,750 shares of Common Stock purchased at a private placement in March 2021. (4) Includes (i) 141,500 shares of Common Stock purchased on the open market; (ii) options exercisable within 60 days to purchase an aggregate of 5,000 shares of Common Stock at the price of $1.77 per share; and (iii) options exercisable within 60 days to purchase an aggregate of 6,667 shares of Common Stock at the price of $1.77 per share. In addition, Mr. Edmunds also owns the following: (i) options to purchase 70,246 shares of Common Stock at the price of $2.90 per share, which will vest over 4 years in equal annual installments starting from June 22, 2022; (ii) options to purchase 15,000 shares of Common Stock at the price of $1.77 per share, which will vest quarterly in 6 equal installments starting from June 30, 2022; and (iii) options to purchase 13,333 shares of Common Stock at the price of $1.77 per share, which will vest quarterly in 8 equal installments starting from April 30, 2022. (5) Includes (i) 16,667 shares of Common Stock purchased at a private placement in August 2019; (ii) 20,000 shares of Common Stock purchased at a private placement in March 2021; (iii) vested options to purchase 275,000 shares of Common Stock at the price of $1.50 per share, granted under the Company s 2019 Plan; (iv) vested options to purchase 2,500 shares of Common Stock at the price of $1.77 per share; and (v) vested options to purchase 2,917 shares of Common Stock at the price of $1.77 per share. In addition, Mr. Ogawa also owns (i) options to purchase 50,000 shares of Common Stock at $3.93 per share, half of which will vest as of June 2, 2022 and the other half June 2, 2023; (ii) options to purchase 17,500 shares of Common Stock at the price of $1.77 per share, which will vest quarterly in 6 equal installments starting from June 30, 2022; and (iii) options to purchase 32,083 shares of Common Stock at the price of $1.77 per share, which will vest quarterly in 8 equal installments starting from April 30, 2022. (6) Includes (i) vested options to purchase 25,000 shares of Common Stock at the price of $1.50 per share, granted under the Company s 2019 Plan; and (ii) vested options to purchase 5,000 shares of Common Stock at the price of $1.77 per share. Mr. Thompson also owns (i) options to purchase 50,000 shares of Common Stock at $3.93 per share, half of which will vest as of June 2, 2022 and the other half June 2, 2023; and (ii) options to purchase 15,000 shares of Common Stock at the price of $1.77 per share, which will vest quarterly in 6 equal installments starting from June 30, 2022. (7) Includes (i) 2,741,033 shares of Common Stock; and (ii) 75,000 shares of Common Stock held by Montrose Capital Partners Limited, over which Mr. Tompkins has voting, dispositive or investment powers. Mr. Tompkins address is Apt. 1, Via Guidino 23, 6900 Lugano-Paradiso, Switzerland. CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS Unless described below, during the last two fiscal years, there are no transactions or series of similar transactions to which we were a party or will be a party, in which: the amounts involved exceeded or will exceed the lesser of $120,000 or 1% of the average of the Company s total assets at year-end for the last two completed fiscal years; and any of our directors, executive officers or holders of more than 5% of our capital stock, or any member of the immediate family of the foregoing persons, had or will have a direct or indirect material interest. On April 7, 2022, in connection with Mark Davidson s appointment as Chief Executive Officer of the Company effective as of April 18, 2022, the Company agreed to pay Mr. Davidson: (i) an annual cash compensation of $300,000; (ii) an annual target bonus for 2022 of up to $150,000, to be paid in stock, that will be prorated for nine (9) months (i.e. $112,500) based on his achievements of performance goals to be finalized and approved by the Board within the first two months of his employment; and (iii) an option to purchase 650,000 shares of common stock of the Company at $1.66 per share, which will vest starting from April 26, 2023, in four annual equal installments. The option will be subject to acceleration in vesting in connection with the occurrence of a change of control event during the term of Mr. Davidson s employment. 60 On March 11, 2020, in connection with his appointment as the Company s Acting Chief Executive Officer and Executive Chairman, Mr. Behfar was granted options to purchase 375,000 shares of Common Stock at the price of $1.50 per share, that vest ratably on a monthly basis over two years and options to purchase 125,000 shares of Common Stock at the price of $1.50 per share, which vested in March 2021. On July 17, 2020, Mr. Behfar was granted options to purchase 600,000 shares of Common Stock at the price of $1.50 per share that vest ratably on a monthly basis over 20 months and options to purchase 200,000 shares of Common Stock at the price of $1.50 per share which vested on March 30, 2021. On September 16, 2020, in connection with his appointment as the Company s Chief Executive Officer and Chairman, Mr. Behfar was granted options to purchase 1,637,410 shares of Common Stock at the price of $1.50 per share that will vest ratably on a monthly basis over 24 months starting from March 11, 2022. Upon Mr. Behfar s resignation as Chief Executive Officer, Chairman of the Board of Directors and Director of the Company, effective as of September 22, 2021, a total of 1,911,160 unvested options were forfeited. In connection with Mr. Edmunds s appointment as a Director and Chairman of Audit Committee of the Company, the Company agreed to pay Mr. Edmunds (i) an annual cash compensation of $20,000; (ii) a one-time grant on June 22, 2021 of non-qualified stock options under the Company 2019 Equity Compensation Plan to purchase 70,246 shares of Common Stock of the Company at $2.90 per share; (iii) an annual grant of non-qualified stock options under the 2019 Plan to purchase a number of shares of Common Stock of the Company that have a value of $60,000, calculated using the fair market value of Common Stock of the Company as determined by the Board as of the date of grant, with an exercise price equal to the closing bid price of Common Stock of the Company as of the date of grant; provided that Mr. Edmunds shall have served on the Board for at least six months prior to the date of grant; and (iv) reimbursement for reasonable out-of-pocket costs and travel expenses in connection with his attendance at meetings of the Board and Audit Committee. On December 30, 2021, the board of directors approved the following grants to our officers and directors under the 2019 Plan: (i) 10-year non-qualified stock options to purchase 20,000 shares of Common Stock at a price of $1.77 per share to each of John Edmunds, Richard Ogawa and Michael Thompson, non-employee directors of the Company; (ii) 10-year non-qualified stock options to purchase 20,000 shares and 35,000 shares of Common Stock at a price of $1.77 per share to John Edmunds (for providing service to the Company as Chairman of the Board) and Richard Ogawa, respectively; and (iii) 5-year options to purchase 100,000 shares and 80,000 shares of Common Stock at a price of $1.77 per share to Richard Brown and James Shealy, respectively. 61 In March 2021, the Company sold 1,251,625 shares of common stock at $4.00 per share for gross proceeds of $5,006,500 in connection with a private placement of securities. The costs associated with such issuance were $407,445 in cash and warrants to purchase 89,730 shares of Common Stock of the Company with a term of 5 years and an exercise price of $4.00 per share. An aggregate of $480,000 of proceeds were raised from related parties (including an aggregate of $430,000 from Alex Behfar s family member, Richard Brown, Richard Ogawa and James Shealy), representing approximately 10% of the total gross proceeds. DESCRIPTION OF CAPITAL STOCK Our authorized capitalization consists of 50,000,000 shares, which include (i) 45,000,000 shares of Common Stock, par value $.0001 per share, of which 12,726,911 shares of Common Stock are issued and outstanding as at the date of this prospectus, and (ii) 5,000,000 shares of preferred stock, par value $.0001 per share, of which no shares are issued and outstanding. Common Stock Each share of Common Stock entitles the holder thereof to one (1) vote on all matters submitted to a vote of the holders of Common Stock. Holders of shares of Common Stock are not entitled to cumulative voting rights in the election of directors. Holders of shares of Common Stock are entitled to receive such dividends as the board of directors may, from time to time, declare out of Company funds legally available for the payment of dividends. Upon any liquidation, dissolution or winding up of the Company, holders of shares of Common Stock are entitled to receive pro rata all of the assets of the Company available for distribution to shareholders. Shareholders do not have any pre-emptive rights to subscribe for or purchase any stock or other securities of the Company. The Common Stock is not convertible or redeemable. Neither the Company s Certificate of Incorporation nor its By-Laws provide for pre-emptive rights. Preferred Stock The Preferred Stock of the Company shall be issued by the Board of Directors in one or more classes or one or more series within any class and such classes or series shall have such voting powers, full or limited, or no voting powers, and such designations, preferences, limitations or restrictions as the Board of Directors may determine from time to time. Warrants As of the date of this prospectus, we had issued (i) five-year warrants to purchase an aggregate of 155,966 shares of Common Stock at an exercise price of $1.50 per share to the placement agent in the August 2019 Private Placement, and (ii) five-year warrants to purchase an aggregate of 89,730 shares of Common Stock at an exercise price of $4.00 per share to the placement agent in the March 2021 Private Placement. Underwriter s Warrants Upon the closing of this offering, there will be up to [ ] shares of Common Stock issuable upon exercise of the representative s warrants, assuming a public offering price of $[ ] per share. See Underwriting Underwriter s Warrants below for a description of the Underwriter s Warrants. Options As of the date of this prospectus, there are 2,048,246 outstanding options to purchase our Common Stock with exercise prices within the range of $1.50 to $3.93 per share. 62 Transfer Agent and Registrar Vstock Transfer, LLC is the transfer agent and registrar for our Common Stock. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS Market Information We received approval from the OTCQB Market to trade our Common Stock under the ticker symbol of ODII as of August 27, 2020. There is currently limited trading volume for our Common Stock. We plan to apply to list our Common Stock on the Nasdaq Capital Market under the symbol of ODII . No assurance can be given that our listing application will be approved. Future sales of substantial amounts of our shares in the public market could adversely affect market prices prevailing from time to time and could impair our ability to raise capital through the sale of our equity securities. Holders As of the date of this prospectus, there are 73 record holders of our Common Stock. Securities Authorized for Issuance under Equity Compensation Plans The following table summarized the compensation plan under which equity securities of the Company are authorized for issuance as of the end of fiscal year 2021. Plan category Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (a) (b) (c) Equity compensation plans approved by security holders 2019 Equity Compensation Plan 1,643,942 $2.23 2,886,129 Equity compensation plans not approved by security holders Total 1,643,942 $2.23 2,886,129 SHARES ELIGIBLE FOR FUTURE SALE Based on our shares outstanding as of March 31, 2022, on the closing of this offering, a total of [ ] shares of Common Stock will be outstanding if the underwriters do not exercise the over-allotment option. Of these shares, all of the Common Stock sold in this offering by us, plus any shares sold by us on the exercise of the underwriters option to purchase additional Common Stock, plus 2,147,120 shares of Common stock currently outstanding and held by public shareholders will be freely tradable in the public market without restriction or further registration under the Securities Act, unless these shares are held by affiliates, as that term is defined in Rule 144 under the Securities Act. 63 The remaining shares of Common Stock will be, and shares of Common Stock underlying stock options and warrants currently outstanding, will be on issuance, restricted securities, as that term is defined in Rule 144 under the Securities Act. These restricted securities are eligible for public sale only if they are registered under the Securities Act or if they qualify for an exemption from registration under Rule 144 under the Securities Act, which is summarized below. Restricted securities may also be sold outside of the United States to non-U.S. persons in accordance with Rule 904 of Regulation S. As a result of the lock-up agreements described below and subject to the provisions of Rules 144 under the Securities Act, a large number of restricted shares of our Common Stock that are beneficially owned by our executive officers, directors and holders of our 3% or more of our Common Stock will be available for sale in the public market upon expiration of the six month lock-up agreements. Rule 144 In general, under Rule 144 as currently in effect, once we have been subject to public company reporting requirements of Section 13 or Section 15(d) of the Exchange Act for at least 90 days, an eligible stockholder is entitled to sell such shares without complying with the manner of sale, volume limitation, or notice provisions of Rule 144, subject to compliance with the public information requirements of Rule 144. To be an eligible stockholder under Rule 144, such stockholder must not be deemed to have been one of our affiliates for purposes of the Securities Act at any time during the 90 days preceding a sale and must have beneficially owned the shares proposed to be sold for at least six months, including the holding period of any prior owner other than our affiliates. If such a person has beneficially owned the shares proposed to be sold for at least one year, including the holding period of any prior owner other than our affiliates, then such person is entitled to sell such shares without complying with any of the requirements of Rule 144, subject to the expiration of the lock-up agreements described below. In general, under Rule 144, as currently in effect, our affiliates or persons selling shares on behalf of our affiliates are entitled to sell shares upon expiration of the lock-up agreements described below. Beginning 90 days after the date of this prospectus, within any three-month period, such stockholders may sell a number of shares that does not exceed the greater of: 1% of the number of common stock then outstanding, or the average weekly trading volume of our common stock on the Nasdaq Capital Market during the four calendar weeks preceding the filing of a notice on Form 144 with respect to such sale. Sales under Rule 144 by our affiliates or persons selling shares on behalf of our affiliates are also subject to certain manner of sale provisions and notice requirements and to the availability of current public information about us. Form S-8 Registration Statement We intend to file a registration statement on Form S-8 under the Securities Act with the SEC to register the offer and sale of shares of our common stock that are issuable under our 2019 Plan. Such registration statement will become effective immediately on filing. Shares covered by these registration statements will then be eligible for sale in the public markets, subject to vesting restrictions, any applicable lock-up agreements described below, and Rule 144 limitations applicable to affiliates. Lock-up Arrangements Pursuant to certain lock-up agreements, we, our executive officers, directors and holders of our 3% or more of our common stock and securities exercisable for or convertible into our common stock outstanding immediately upon the closing of this offering have agreed, subject to certain exceptions, not to offer, sell, assign, transfer, pledge, contract to sell, or otherwise dispose of or announce the intention to otherwise dispose of, or enter into any swap, hedge or similar agreement or arrangement that transfers, in whole or in part, the economic risk of ownership of, directly or indirectly, engage in any short selling of any common stock or securities convertible into or exchangeable or exercisable for any common stock, whether currently owned or subsequently acquired,
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY THE DOCS, INC. The following summary highlights selected information contained in this Prospectus. This summary does not contain all the information that may be important to you. You should read the more detailed information contained in this prospectus, including but not limited to, the risk factors beginning on page 3. References to "we," "us," "our," "The Docs, Inc.," or the "Company" mean The Docs, Inc. Forward-Looking Statements This Prospectus contains forward-looking statements that involve risks and uncertainties. We use words such as anticipate, believe, plan, expect, future, intend, and similar expressions to identify such forward-looking statements. You should not place too much reliance on these forward-looking statements. Our actual results may differ materially from those anticipated in these forward-looking statements for many reasons, including the risks faced by us described in the "Risk Factors" section and elsewhere in this Prospectus.
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+Summary of the Prospectus 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, references to: amended and restated memorandum and articles of association are to our amended and restated memorandum and articles of association to be in effect upon completion of this offering; Companies Act are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; equity-linked securities are to any securities of our company which are convertible into or exchangeable or exercisable for, ordinary shares of our company; extension option are to the option of the sponsor upon deposit of the extension fee into the trust account, to cause us to extend the available time to consummate our initial business combination by one month. The sponsor may exercise the extension option up to fifteen times, allowing for up to an additional fifteen months (for a total of 24 months) to complete a business combination. extension fee are to an amount equal to three and one-third cents per public share (a total of $500,000, or $575,000 if the underwriters over-allotment option is exercised in full) that the sponsor may deposit into the trust account in order to exercise the extension option. Founder is to Alexander Crutchfield. founder shares are to our Class B ordinary shares initially purchased by our sponsor in a private placement prior to this offering and, unless the context otherwise requires, our Class A ordinary shares issued upon the conversion thereof as provided herein; initial shareholders are to the holders of our founder shares prior to this offering; letter agreement refers to the letter agreement, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team are to our officers and directors; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private placement warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering; public shareholders are to the holders of our public shares; public shares are to our Class A ordinary shares offered as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public warrants are to the redeemable warrants sold as part of the units in this offering (whether they are subscribed for in this offering or in the open market); sponsor are to ONS Acquisition Management LLC, a Delaware limited liability company; our Chief Executive Officer is the managing member of our sponsor; warrants are to our redeemable warrants, which include the public warrants as well as the private placement warrants; and we, us, company, ONS Acquisition or our company are to ONS Acquisition Corp., a Cayman Islands exempted company. 1 Table of Contents All references in this prospectus to shares of ONS Acquisition being forfeited shall take effect as surrenders for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. All references in this prospectus to share dividends of ONS Acquisition shall take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Registered trademarks referred to in this prospectus are the property of their respective owners. Our Company We are a blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target. We believe that there are significant, attractive investment opportunities that exist within industries that can benefit from strong Environmental, Social and Governance ( ESG ) practices which we believe will become defining factors in many companies long-term prospects. Given the current dislocations in the global supply chains and channels coupled with general market dislocations, our team believes there are multiple opportunities for the effective deployment of capital, especially in companies that could benefit from ESG strategies. While ESG investing is a broad term for investments that seek positive returns and long-term impact on society, environment and performance of the business, we are focused on evaluating suitable targets that have existing environmental sustainability practices or that may benefit, both operationally and economically, from our management team s commitment and expertise in executing on ESG strategies. We believe our management team s extensive investment and operational experience allows us to evaluate targets in industries such as food production, which includes aquaculture and seafood, sustainable consumer-facing products, logistics, technology, such as hardware, software, networks and e-platforms, agriculture and energy, which includes underlying renewable technologies, utility services, energy efficiency and management, among others. Furthermore, our target universe could include companies undergoing a transition to increase their environmental sustainability profiles, reflecting an opportunity to bring environmentally sustainable practices to companies that may not have historically been focused on environmental sustainability. We generally intend to target companies with stable growth and potential to benefit from access to public market capital. We believe in our management team s ability to add significant value to a target company from a commercial, operating, strategic and sustainability perspective. In particular, we intend to identify and acquire a business that could benefit from an owner with extensive operational and public company management experience or presents an attractive risk adjusted return profile under our stewardship. Our management team has significant hands-on experience with preparing private companies for the execution of initial public offerings. Our management team has been active as owners and directors by working closely with companies to pursue their growth potential and help create value in the public markets. Our Founder, Our Board of Directors and Management Alexander Crutchfield serves as our Chief Executive Officer and the Executive Chairman of our board of directors. Since 1989, Mr. Crutchfield has served as Senior Managing Director of Western International Holdings-Oasis Partners, an advisory and investment firm, and has also managed his family s investments, and he has served as an independent director of Endeavour International and its UK, Netherlands and Luxembourg affiliates, from 2014 to 2016. He also currently serves as Executive Chairman of Guyana Capital Group, as Executive Chairman of Guyana Security Company and as board member of Nottingham-Spirk Design Associates. Earlier in his career, from 1984 to 1997, Mr. Crutchfield was Vice Chair of American Water Development Inc. As a principal, operating through several private entities, Mr. Crutchfield farmed organic row crops using sustainable farming methods and was a rancher with an organic cow calf and steer operation, and he bought, preserved, developed, subdivided and sold large tracts of land. Mr. Crutchfield earned a BA in Economics from Claremont McKenna College and received his MBA from Columbia University. Joachim Gfoeller serves as our Chief Financial Officer and as a member of our Strategic Advisory Board. Mr. Gfoeller is a veteran investment banker and venture capital investor, having co-created and operated three private equity funds and advised dozens of portfolio companies, particularly in technology businesses. From 1997 to 2015, Mr. Gfoeller served as general partner of GMG Capital Partners L.P. and its three investment funds. Fund investors 2 Table of Contents included well-known institutional investors and high net worth individuals. Mr. Gfoeller served as a director of many of the GMG fund companies and other growth stage companies, including Flanders Filters, Inc., Iverify, Inc., Lancope, Inc., Phobos Corporation and StoreApps. Since 2015, Mr. Gfoeller has been director of investments and a member of the board of directors of Nottingham-Spirk Design Associates, a consumer and industrial products design and development firm that makes private equity investments alongside its clients. Mr. Gfoeller also serves as Chair and a member of the board of directors of TecTraum, Inc. and eChemion, Inc., and a member of the board of directors of Jacuzzi Brands LLC, Polar Delight, Inc., Sterifre Medical, Inc. and Xatek, Inc., and as Chief Investment Officer of Dignity Designed & Delivered Inc. and Principal of Strategic Investments at Reveille. Mr. Gfoeller earned his B.A. degree from the Ohio State University, an M.A. degree from the Johns Hopkins School of Advanced International Studies, and his MBA from the University of Pennsylvania. Robert B. Nolan, Jr. has agreed to serve on our board of directors. Mr. Nolan is the founding partner of Halyard Capital and has chaired the Investment Committee for 18 years across their three separate funds totaling more than $600 million. He represented Halyard on the Boards of EducationDynamics, Practice Insight, Jun Group, Engauge Marketing, LLC, Women s Marketing, Inc., American Consolidated Media, Inflow, North Dakota Holdings, and TRANZACT. From 2001 until January 2006, Mr. Nolan was the CEO of the BMO Private Equity Group, overseeing an investment portfolio with $1 billion in capital. Previously, Mr. Nolan was Managing Director and Head of Media & Telecommunications Investment Banking at CIBC World Markets. Prior to CIBC, Mr. Nolan was Telecommunications Group Head at UBS Securities. He also worked for nine years at Goldman, Sachs & Co. in the Telecommunications, Media & Technology Group. Currently, Mr. Nolan serves as a Senior Advisor to Brown Brothers Harriman, the Mission OG Group and Connecticut Innovations, and he also serves on the Board of Directors at Point Pickup Technologies and an observer on the Board of Directors of Curacity. Mr. Nolan is a member of the New York and Washington, D.C. Bar Associations. Mr. Nolan received a J.D. from the Fordham University School of Law and a B.S in Business Administration from Georgetown University. Mr. Nolan is a member of the McDonough School of Business Board of Advisors. Toby Corey has agreed to serve on our board of directors. Mr. Corey has managed three greater than $1 billion businesses, two successful IPOs, and raised over $300 million in private and public financings. Mr. Corey is a former President of Global Sales and Customer Experience at SolarCity, a leader in clean energy services which conducted a successful IPO and subsequent merger with Tesla. Mr. Corey is a co-founder and former President and COO of USWeb, a worldwide leader in web development services with greater than $3 billion market cap and successful IPO. Mr. Corey currently serves as Executive Chair, Chief Operating Officer and member of the board of directors of CruzFoam. Mr. Corey previously served as a board member of Palmetto Solar, Buoy and WildLifeDirect and as an advisory board member of Inboard Technologies and YaDoggi. Mr. Corey is currently a faculty member at Stanford University. Mr. Corey received his B.S. in Economics from Southern Connecticut State. Chesley Maddox-Dorsey has agreed to serve on our board of directors. Since September 2018, Ms. Maddox-Dorsey has been the Chief Executive Officer of A Wonder Media Company, parent company of American Urban Radio Networks (AURN) and Superadio. Prior to joining A Wonder Media Company, Ms. Maddox-Dorsey was the CEO of Access.1 Communications Corp from 2010 to 2018, and President from 1999 to 2010. Prior to joining Access.1, Ms. Maddox-Dorsey was a Senior Vice President in the Investment Banking division of Brenner Securities from 1992-1998. Prior to joining Brenner, Ms. Maddox-Dorsey was the principal of the CMA Investment Banking Company from 1987 to 1992. As former Vice President of Specialized Lending for Ameritrust Company from 1982 to 1987, Ms. Maddox-Dorsey led the bank s initiation into media lending. Ms. Maddox-Dorsey is a graduate of Oberlin College, with a B.A. in Government. Nathan Leight has agreed to serve on our board of directors. Mr. Leight has 35 years of experience in capital markets, asset and portfolio management, venture capital and private equity investing. Since 1998, Mr. Leight has been the senior managing member of Terrapin Partners, LLC and chief investment officer of Terrapin Asset Management, LLC. He is also chairman and CEO of The Juice LLC, an education and media company. Mr. Leight has served on the boards of six publicly traded companies, including as chairman of three publicly traded special purpose acquisition companies. From 2005 to 2006, Mr. Leight was chairman of Aldabra Acquisition Corporation, a blank check company, that raised $55.2 million of gross proceeds in its 2005 initial public offering and later merged with affiliates of Great Lakes Dredge & Dock Corporation, which at the time was the largest provider of dredging services in North America, in a transaction valued at more than $400 million. He served as chairman of Great Lakes from 2011 to 2015. Mr. Leight served as chairman of Aldabra 2 Acquisition Corp., another blank check company, which raised $414 million of gross proceeds in its 2007 initial public offering and later acquired the paper and packaging 3 Table of Contents assets of Boise Cascade, LLC to form Boise, Inc. in a transaction valued at more than $1.6 billion, Mr. Leight served as a director of Boise Inc. for five years, from 2007 to 2012. Additionally, Mr. Leight was chairman of Terrapin 3 Acquisition Corporation until 2016, another blank check company, that raised $212.75 million of gross proceeds in 2014 and later combined with Yatra Online, Inc., the second largest India-based online travel agent. From 2009 to 2011, Mr. Leight served on the board of TradeStation Group, Inc., now a wholly-owned subsidiary of Monex Group, Inc. (Tokyo Stock Exchange: 8698). Mr. Leight also served as CEO of e-STEEL LLC, an internet-based steel marketplace, and VastVideo, Inc., a video content and technology provider. Before forming Terrapin Partners, LLC, Mr. Leight was the chief investment officer of Gabriel Capital, a hedge fund which specialized in bankruptcies, under-valued securities, emerging markets, private equity and merger arbitrage. Prior to joining Gabriel, Mr. Leight established and oversaw the proprietary trading department at Dillon Read & Co., which specialized in bankruptcy/distressed situations and risk arbitrage. Mr. Leight started his career as an associate in the corporate finance department of Oppenheimer & Co. Mr. Leight received his A.B. cum laude from Harvard College. R. Rudolph Reinfrank has agreed to serve on our board of directors. Mr. Reinfrank has over 30 years of private equity investment experience. Mr. Reinfrank is Managing General Partner of Riverford Partners LLC, an advisory services firm, which he founded in 2009, and also serves as an advisor to BC Capital Partners and on the advisory board of Grafine Partners. Previously, Mr. Reinfrank was Managing General Partner at Clarity Partners, a Los Angeles based private equity firm, from 2000 until 2009. Mr. Reinfrank also served on the investment committee for Clarity Partners. Prior to joining Clarity Partners, Mr. Reinfrank was co-founder and Managing Director at Rader Reinfrank and Co., LLC from 1997 to 2009. Mr. Reinfrank is a member of the board of directors of Apollo Investment Corporation, and a member of its audit, nominating and governance committees, is a director of Perception Capital Corp. II, and also serves as a director and member of the audit committee of Mount Logan Capital Inc. Mr. Reinfrank is a Senior Advisor to BC Partners, Grafine Partners (New York City), Pall Mall Capital, Ltd. (London), The K Fund/Andina Family Offices and Transnational Capital Corporation (New York City). Mr. Reinfrank was previously a director of WebTV Networks, Trillium Digital Systems, Weatherford International, Enterra Corporation, CRC-Evans Pipeline, Parker Drilling Company, Kayne Anderson Acquisition Corp., Impremedia LLC, Base Entertainment LLC, Naylor LLC, Crescent Entertainment, LLC and Central Soya, Inc. Mr. Reinfrank earned a B.A. in Economics from Stanford University and an M.B.A. in Finance and Marketing from The Anderson School of Management at the University of California, Los Angeles. Strategic Advisory Board We will further be supported by our team of advisors comprised of individuals with experience in a wide range of sub-sectors. They will provide us with access to their expertise and extensive industry networks from which we intend to source and evaluate targets as well as devise plans to optimize any business that we acquire. Mark Davis is a Partner at G.C. Andersen Partners. Mr. Davis has completed over $24 billion of financing transactions and advisory assignments. Mr. Davis has strong relationships with several leading private equity firms and helps them acquire, finance, and sell their portfolio companies. Mr. Davis has extensive transaction experience in high yield, first and second lien debt, equity offerings, and exclusive sale and restructuring assignments. Before joining G.C. Andersen Partners, Mr. Davis worked for a number of investment banks, including Jefferies, DLJ, and Wasserstein Perella. Mr. Davis received a BA in Economics from the University of Michigan and a MBA from Dartmouth College. Lieutenant General Richard Newton USAF (ret.) served 34 years in the U.S. Military which culminated in serving in the position of the United States Air Force Assistant Vice Chief of Staff. Previously, he served as the Deputy Chief of Staff for Manpower and Personnel. Additionally, he oversaw the Global Operations directorate for the Joint Chiefs of Staff, responsible for overseeing worldwide cyber security, reconnaissance, space and missile defense, the National Military Command Center and US military special technical operations, among others. He also has significant corporate board experience. General Newton is a Director of Victory Capital Management, Inc., United Services Automobile Association (USAA) Mutual Fund Board of Trustees, and Vice Chairman of the Board, PredaSAR Corporation. General Newton commanded Minot Air Force Base and the 5th Bomb Wing in North Dakota and the nation s first B-2 Stealth bomber squadron at Whiteman AFB, Missouri. He has operational experience in B-2, B-1B and B-52. General Newton earned his BS at the United States Air Force Academy, an MA at Webster University, and an MS at National War College. Lee Stern is a Managing Director at Monroe Capital and a member of the board of directors of Helbiz, Inc. Previously, Mr. Stern was a Managing Director at Levine Leichtman Capital Partners, Director and a founding member of Kohlberg Kravis Roberts Mezzanine fund (KKRMP), a Managing Director at Blackstone/GSO Partners, and the Chief Transaction Officer at Technology Investment Capital. Mr. Stern held similar roles at Nomura 4 Table of Contents Securities, Kidder, Peabody & Company, and Drexel Burnham Lambert. Mr. Stern previously served as Chief Financial Officer of Reliacast, Inc. He received a BA in Philosophy from Middlebury College and his MBA from University of Pennsylvania. John Spirk is the Co-President and member of the board of directors of Nottingham Spirk, a leading business innovation firm with over 1,300 patents, of which 95% have been commercialized. He has helped partner companies earn over $50 billion in combined sales for product lines like Dirt Devil, Little Tikes, Dutch Boy, and Unilever s AXE brand. Nottingham Spirk has co-created companies based on NS innovations, like the Crest SpinBrush venture which was sold to Proctor & Gamble and the Swiffer Sweep+Vac which was also sold to Proctor & Gamble. Mr. Spirk serves on the Cleveland Clinic Board of Trustees and has served on the board of the Cleveland Institute of Art, as well as several other private equity company boards. Mr. Spirk is a holder of many patents in the USA, a Fellow of the National Academy of Inventors, and a winner of the EY Entrepreneur of the Year Award. Other awards include Gold IDEA Award, Edison Gold Award and DuPont Packaging Gold Award. With respect to the above, past performance of our management team and strategic advisors is not a guarantee of either (i) success with respect to a business combination that may be consummated or (ii) the ability to successfully identify and execute a transaction. You should not rely on the historical record of management or their respective affiliates as indicative of future performance. See Risk Factors Past performance by our management team and their respective affiliates may not be indicative of future performance of an investment in us. Past performance by our management team, including investments and transactions in which they have participated and businesses with which they have been associated, may not be indicative of future performance of an investment in us, and we may be unable to provide positive returns to shareholders. For a list of our executive officers and entities for which a conflict of interest may or does exist between such officers and the company, please refer to Management Conflicts of Interest. Business Strategy Our acquisition and value creation strategy is to identify and complete our initial business combination with a company in an industry that complements the experience and expertise of our management team and is focused on, or could benefit from, environmentally sustainable business practices. We will seek to: Leverage the strategic and transactional experience of our management team to bring advice and attention to potential targets; Leverage our relationships in middle market credit and sponsor group relationships; Grow companies, both organically and through strategic transactions, expanding product portfolios and broadening geographic footprints; Deliver creative approaches to transaction sourcing; Utilize our management team s understanding of global financial markets and events, financing and overall corporate strategy options, including assistance with preparing target companies to become public companies; and Implement sustainable operational and commercial improvements at target companies to eliminate economic and environmental waste. Our selection process will leverage our management team s network of industry, private equity sponsor, and credit lending community relationships as well as relationships with management teams of public and private companies, investment bankers, management consultants and other professionals, which we believe will provide us with a number of business combination opportunities. We intend to deploy a proactive and thematic sourcing strategy with a focus on companies where we believe the combination of our operating experience, relationships, capital and capital markets expertise can be a catalyst to transform a target company and accelerate the target s growth, performance and sustainability profile. Upon completion of this offering, members of our management team will communicate with their network of relationships to articulate our initial business combination criteria, including the parameters of our search for a target business, and will begin the disciplined process of pursuing and reviewing promising leads. 5 Table of Contents The members of our management team have experience in: Operating, identifying, and investing in companies with a focus on clean energy and environmentally sustainable business practices; Operating companies, setting and enacting strategies, and identifying, monitoring and recruiting world-class talent; Developing and growing companies, both organically and through acquisitions and strategic transactions and expanding the product range and geographic footprint of a number of target businesses; Sourcing, structuring, acquiring and selling businesses; Accessing the capital markets, including financing businesses and helping companies transition to public ownership; Fostering relationships with sellers, capital providers and target management teams; and Executing transactions and business plans under various economic and financial market conditions. The sourcing, valuation, diligence and execution capabilities of our management team will provide us with a significant pipeline of opportunities from which to evaluate and select a business that will benefit from our expertise. Our competitive strengths include the following: Strong Management Team and Sponsorship. We believe that our management team, with its decades-long proven ability to execute and simultaneously improve both financial metrics and sustainability, will be viewed favorably by target businesses in need of ESG guidance, improved operating processes and controls, better access to industry relationships and strategic planning. Leading Experience in Environmentally Sustainable Practices. Our management team has significant experience in sustainable business development as well as investment in new technologies which support sustainability. Proprietary Sourcing Channels and Leading Industry Relationships. We believe the capabilities and connections associated with our management team and sponsor will provide us with a differentiated pipeline of merger opportunities that would be difficult for other participants in the market to replicate. We expect these sourcing capabilities will be further bolstered by our management team s reputation and deep industry relationships. Investing Experience. We believe that our management and sponsor s track record of identifying and sourcing transactions positions us well to evaluate potential investment targets and select one that will be well-received by the public markets and our shareholders. Execution and Structuring Capability. We believe that our management team s combined industry expertise and reputation will allow them to source and complete transactions possessing structural attributes that create an attractive investment thesis. These types of transactions are typically complex and require creativity, industry knowledge and expertise, rigorous due diligence, and extensive negotiations and documentation. We believe that by focusing our investment activities on these types of transactions, we are able to generate investment opportunities that have attractive risk/reward profiles based on their valuations and structural characteristics. Investment Criteria Consistent with our strategy, we have identified the following general criteria and guidelines which we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. We intend to acquire one or more businesses or entities that we believe: Benefits from Environmentally Sustainable Business Practices. We will seek to acquire a business that (i) has existing operating practices that promote and profit from environmental sustainability or (ii) would benefit from implementing environmentally sustainable commercial and operating practices, leveraging the expertise of our management team. 6 Table of Contents Has a Defensible Market Position and diversified customer base, which in turn will make it more resilient to economic cycles and downturns. Will maintain strong cash flow characteristics. We will seek to acquire a business that has highly recurring, stable cash flows and operating leverage and may benefit from optimizing or de-levering the capital structure. Would Benefit Uniquely from our Capabilities. We will seek to acquire a business where we can leverage the collective capabilities of our management and sponsor to tangibly improve the operations and market position of the target. Can utilize our management team s global network of contacts, which provides access to differentiated deal flow and significant deal-sourcing capabilities. Has a public-ready management team. We will seek to acquire a business with a professional management team whose interests are aligned with those of our investors and complement the expertise of our management team and sponsor. Has the Potential to Grow Organically or Through Additional Acquisitions, and as such, will benefit from a public currency to enhance their ability to pursue accretive acquisitions and high-return capital projects. Will offer an attractive risk-adjusted return for our shareholders potential upside from growth in the target business and an improved capital structure will be weighed against any identified downside risks. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC. Our Acquisition Process In evaluating a prospective target business, we expect to conduct a thorough due diligence review which will encompass, among other things, meetings with incumbent management and employees, document reviews, inspection of facilities, as well as a review of financial, operational, legal and other information which will be made available to us. We will also utilize our operational and capital planning experience. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion that our initial business combination is fair to our company from a financial point of view from either an independent investment banking firm that is a member of the Financial Industry Regulatory Authority, Inc. ( FINRA ) or an independent accounting firm. Members of our management team may directly or indirectly own our ordinary shares and/or private placement warrants following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors is included by a target business as a condition to any agreement with respect to our initial business combination. Initial Business Combination Our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (excluding the amount of deferred underwriting discounts held in trust and taxes payable on the income earned on the trust account) at the time of signing the 7 Table of Contents agreement to enter into the initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses or we are considering an initial business combination with an affiliated entity, we will obtain an opinion with respect to the satisfaction of such criteria from an independent investment banking firm that is a member of FINRA or an independent valuation or accounting firm. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. Subject to this requirement, our management will have virtually unrestricted flexibility in identifying and selecting one or more prospective businesses, although we will not be permitted to effectuate our initial business combination with another blank check company or a similar company with nominal operations. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the prior owners of the target business, the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking shareholder approval, as applicable. In addition, we have agreed not to enter into a definitive agreement regarding an initial business combination without the prior consent of our sponsor.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001811369_v_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001811369_v_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..57b74ec7b51090e847cd3e2f4e94fb4c6c88cd96
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001811369_v_prospectus_summary.txt
@@ -0,0 +1,402 @@
+PROSPECTUS SUMMARY
+
+ 
+
+As used in this prospectus, references to the "Company," "we," "our", "us" or "Blockchain
+" refer to V. Blockchain Group Inc., unless the context otherwise indicates. The following summary highlights selected information
+contained in this prospectus. Before making an investment decision, you should read the entire prospectus carefully, including
+the "Risk Factors" section, the financial statements, and the notes to the financial statements.
+
+ 
+
+Our company
+
+ 
+
+V Blockchain Group Inc., was incorporated on September 14, 2018 under the laws of
+the State of Texas. We are in the business of trading collectible US gold coins and precious metals and developing virtual currency
+trading platforms. Before we could successfully create our first virtual currency platform, we rely on other sources of revenue
+to support our on-going business operations. We have discontinued our study abroad consulting services. We believe buying and selling
+gold and precious metals fit our business models.
+
+ 
+
+Our principal products and Services
+
+ 
+
+A. Our first
+objective is to start trading with precious metals such as US collectible gold coins, gold, silver, platinum, and rhodium. We recently
+began to acquire an inventory of US collectible gold coins. We have discontinued our study abroad consulting services because it
+does not fit very well into our current business models.
+
+ 
+
+We do not anticipate a shortage of raw materials because of US collectible gold coins,
+gold and silver are common commodities among coin dealers in the United States. We principally used these suppliers:
+
+ 
+
+(1) https://www.greatcollections.com (2) https://www.ha.com (3) https://auctions.stacksbowers.com.
+These suppliers can sell or liquidate our inventory of gold and silver coins up to $1 million. Gold and silver coins are very liquid
+commodities and easily turned into cash. We purchased these US collectible gold coins at wholesale prices and sell them to the
+consumer at retail prices. If our gold and silver bullion coins are priced competitively, there are additional dealer-to-dealer
+channels of distribution, we could sell them quickly which include but not limited to: (a) Certified Coin Exchanges; (b) Dealer
+Coin Network. E-bay is our core retail sales channel in which we could utilize selling to our retail customers. We believe buying
+or selling gold and precious metal or bullion coins fits our business models.
+
+ 
+
+Our virtual currency trading platform
+
+ 
+
+B. Our second objective
+is to start a virtual asset platform in the United States. We have initiated our application for a New York Bit License
+(dfs.ny.gov). We believe our sources of funds are adequate for a virtual digital platform and we expected timing of its business
+development is 360 days. The New York Bit License supported an approved list of digital assets included but not limited to: Bitcoin
+(BTC); Bitcoin Cash (BCH); Ethereum Classic ( ETC), Ethereum ( ETH); Gemini Dollar ( GUSD), GMO JPY (GYEN); Litecoin( LTC);
+Lumens ( XLM); Pax Gold ( PAXG), Pax Standard ( Pax), Z.ComUSA (ZUSD) ; Binance USD(BUSD); Basic Attention
+Token ( BAT). This list is subject to change without notice. New York Bit License has all the discretion to add or removal any
+crypto-currency that does not comply with the federal regulations.
+
+ 
+
+We will develop a virtual currency platform that will meet the distinct needs of
+our customers. Our digital currency platform will be powered by technology system that will enable us to implement our virtual
+currency platform.
+
+ 
+
+Our Offering
+
+ 
+
+The company is going forward with its offering
+of 7,500,000 shares of common stock on a best-efforts basis and there is no minimum amount of proceeds the company may receive.
+Funds raised under this offering will not be held in trust or in an escrow account and all funds raised, regardless of the amount,
+will be available to the company. In the event the company does not raise $30,000 to implement its planned operations, your entire
+investment could be lost. The amount of funds necessary to implement our plan of operation may not be fully obtained from the offering,
+cannot be predicted with any certainty and may exceed any estimates we set forth. Our officer and director agreed to
+loan the company funds in the form of $200,000 line of credit; she has advanced $143,102 for inventory purchases, such that there
+is $56,898 remaining to fund ongoing operations.
+
+ 
+
+The company s office is located at 4777 Sweetwater Blvd, #199. Sugar Land,
+Texas 77479. Tel: (713-898-6818,. We intend to use the net proceeds from this offering to develop our business operations
+(see "Use of Proceeds" on page 17). Our sole officer and director, Tian Jia, agreed
+to extend up to $200,000 line of credit to fund our company s operation. In addition, we received $112,500 through
+the sale of common stock through our sole officer and director, Tian Jia, who purchased 22,500,000 shares of common stock at $0.005
+per share.
+
+ 
+
+As of the date of this prospectus, there is no public trading market for our common
+stock and no assurance that a trading market for our securities will ever develop or, if any market does develop, it may not be
+sustained. Our common stock is not traded on any exchange or the over-the-counter market. After the effective date of the registration
+statement relating to this prospectus, we hope to have a market maker file an application with the Financial Industry Regulatory
+Authority ("FINRA") for our common stock to be eligible for trading on the OTCQB. We do not yet have a market maker
+who has agreed to file such application. There can be no assurance that our common stock will ever be quoted on a stock exchange
+or a quotation service or that any market for our stock will develop.
+
+ 
+
+This is a direct participation offering since we are offering the stock directly
+to the public without the participation of an underwriter. Our sole officer and director, Tian Jia, will be responsible for selling
+shares under this offering and no commission will be paid on any sales.
+
+ 
+
+4
+
+_________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
+
+ THE OFFERING
+ 
+
+ The Issuer
+ V Blockchain Group Inc.,
+
+ Securities offered:
+ 7,500,000 shares of our common stock, par value $0.00000001 per share.
+
+ Offering price:
+ $0.02
+
+ Duration of offering:
+ Our offering will terminate upon the earliest of (I) such time as all the common stock has been sold pursuant to the registration statement or (ii) 365 days from the effective date of this prospectus; (iii) when the Board of Directors decide that it is in the best interest of the company to terminate the offering prior the completion of the sale of all 7,500,000 shares registered under the Registration Statement of which this prospectus is part.
+
+ Gross Proceeds from selling 20% of shares
+ $30,000
+
+ Gross Proceeds from selling 40% of shares
+ $60,000
+
+ Gross Proceeds from selling 80% of shares
+ $120,000
+
+ Gross Proceeds from selling 100% of shares
+ $150,000
+
+ Net proceeds to us:
+ $150,000, assuming the maximum number of shares sold. For further information on the Use of Proceeds, see page 17.
+
+ Market of the common stock:
+ 
+ There is no public market for our shares. Our common stock is not traded on
+ any stock exchange or the over-the-counter market. After the effective date of the registration statement relating to this prospectus,
+ we hope to have a market maker file an application with the Financial Industry Regulatory Authority ("FINRA") for our common stock
+ to eligible for trading on the OTC Bulletin Board. We do not yet have a market maker who has agreed to file such application.
+
+ There is no assurance that a trading market will develop, or, if developed,
+ that it will be sustained. Consequently, a purchaser of our common stock may find it difficult to resell the securities offered
+ herein should the purchaser desire to do so when eligible for public resale.
+
+ Shares outstanding prior to offering:
+ 22,500,000
+
+ Shares outstanding after offering:
+ 30,000,000 (assuming all the shares are sold)
+
+ Risk Factors:
+ The common stock offered hereby involves a high degree of risk and should not be purchased by investors who cannot afford the loss of their entire investment. See "Risk Factors" beginning on page 10.
+
+ 
+
+5
+
+_____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
+
+SUMMARY FINANCIAL INFORMATION
+
+The following tables set forth a summary of the Company s financial information
+as provided in its year-end financial statements. You should read this information together with our audited financial statements
+and the notes thereto appearing elsewhere in this Prospectus and the information under "Management s Discussion and
+Analysis". 
+
+ 
+ 
+ 
+ March 31, 2021
+ 
+ 
+ 
+ As of March 31, 2020
+ 
+ 
+
+ Statement of Operations data
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Revenue
+ 
+ $
+ -0-
+ 
+ 
+ $
+ 10,098
+ 
+ 
+
+ Net Profit
+ 
+ $
+ (2,546)
+ 
+ 
+ $
+ 7,212
+ 
+ 
+
+ Net Profit per share, basic and diluted
+ 
+ $
+ (0.00
+ )
+ 
+ $
+ (0.00
+ )
+ 
+
+ Weighted average number of shares outstanding, weighted and diluted
+ 
+ $
+ 22,500,000
+ 
+ 
+ $
+ 22,500,000
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+ March 31, 2021
+
+ 
+ 
+ 
+ As of March 31,2020
+ 
+
+ Balance Sheet data
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Cash and cash equivalents
+ 
+ $
+ 200,756
+ 
+ 
+ $
+ 123,302
+ 
+
+ Inventory
+ 
+ $
+ 63,102
+ 
+ 
+ $
+ 8,700
+ 
+
+ Stock Subscription Receivable
+ 
+ $
+ -
+ 
+ 
+ $
+ -
+ 
+
+ Total stockholder s equity
+ 
+ $
+ 120,756
+ 
+ 
+ $
+ 123,302
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Smaller Reporting Company
+
+ 
+
+Implications of being an emerging growth company - the JOBS
+Act
+
+ 
+
+We qualify as an emerging growth company as that term is used
+in the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise
+applicable generally to public companies. These provisions include:
+
+ 
+
+ 
+A requirement to have only two years of audited financial statements and only two years of related MD 
+
+ 
+
+ 
+Exemption from the auditor attestation requirement in the assessment of the emerging growth company's internal control over financial
+reporting under Section 404 of the Sarbanes-Oxley Act of 2002;
+
+ 
+
+ 
+Reduced disclosure about the emerging growth company's executive compensation arrangements; and
+
+ 
+
+ 
+No non-binding advisory votes on executive compensation or golden parachute arrangements.
+
+ 
+
+We may take advantage of the reduced reporting requirements
+applicable to smaller reporting companies even if we no longer qualify as an "emerging growth company."
+
+ 
+
+We could remain an emerging growth company for up to five years,
+or until the earliest of (I) the last day of the first fiscal year in which our annual gross revenues exceed $1 billion, (ii) the
+date that we become a "large accelerated filer" as defined in Rule 12b-2 under the Exchange Act, which would occur if the market
+value of our common stock that is held by non-affiliates exceeds $700 million as of the last business day of our most recently
+completed second fiscal quarter, or (iii) the date on which we have issued more than $1 billion in non-convertible debt during
+the preceding three year period.
+
+ 
+
+ We elected to take advantage of the extended transition
+period for complying with new or revised accounting standards under Section 102(b)(1) of the JOBS Act.
+
+ 
+
+6
+
+____________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
+
+Item 3a: RISK FACTORS
+
+ 
+
+We consider the following to be the material risks for an
+investor regarding this offering. Our company should be viewed as a high-risk investment and speculative in nature. An investment
+in our common stock may result in a complete loss of the invested amount.
+
+ 
+
+An investment in our common stock is highly speculative, and
+should only be made by persons who can afford to lose their entire investment in us. You should carefully consider the following
+risk factors and other information in this report before deciding to become a holder of our common stock. If any of the following
+risks occur, our business and financial results could be negatively affected to a significant extent.
+
+ 
+
+ Item 3b:
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001811856_view-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001811856_view-inc_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001811856_view-inc_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001813756_wework-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001813756_wework-inc_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001813756_wework-inc_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001815849_ati_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001815849_ati_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..81b209230e1212fcce7adc6fe08727bba434f073
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001815849_ati_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. It does not contain all the information that you may consider important in making your investment decision. Therefore, you should read the entire prospectus carefully, including, in particular, the sections entitled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations, and our consolidated financial statements and related notes. As used in this prospectus, unless the context otherwise requires or indicates, references to ATI, Company, we, our, and us, refer to ATI Physical Therapy, Inc. and its subsidiaries. Overview We are the largest single-branded independent outpatient physical therapy provider in the United States by clinic count as of December 31, 2021. We specialize in outpatient rehabilitation and adjacent healthcare services, with 910 owned clinics (as well as 20 clinics under management service agreements) located in 25 states as of December 31, 2021. We operate with a commitment to providing our patients, medical provider partners, payors and employers with evidence-based, patient-centric care. We offer a variety of services within our clinics, including physical therapy to treat spine, shoulder, knee and neck injuries or pain; work injury rehabilitation services, including work conditioning and work hardening; hand therapy; and other specialized treatment services. Our team of professionals is dedicated to helping return patients to optimal physical health. Physical therapy patients receive team-based care, leading-edge techniques and individualized treatment plans in an encouraging environment. To achieve optimal results, we use an extensive array of techniques including therapeutic exercise, manual therapy and strength training, among others. Our physical therapy model aims to deliver optimized outcomes and time to recovery for patients, insights and service satisfaction for referring providers and predictable costs and measurable value for payors. In addition to providing services to physical therapy patients at outpatient rehabilitation clinics, we provide services through our ATI Worksite Solutions ( AWS ) program, Management Service Agreements ( MSA ), and Sports Medicine arrangements. AWS provides an on-site team of healthcare professionals at employer worksites to promote work-related injury prevention, facilitate expedient and appropriate return-to-work follow-up and maintain the health and well-being of the workforce. Our MSA arrangements typically include us providing management and physical therapy-related services to physician-owned physical therapy clinics. Sports Medicine arrangements provide certified healthcare professionals to various schools, universities and other institutions to perform on-site physical therapy and rehabilitation services. We believe our platform is advanced in the industry in terms of our team, our clinical systems, and our corporate infrastructure. We are leveraging our platform in an effort to address some of the most pressing challenges in the U.S. healthcare system, including high costs and poor clinical outcomes. Our mission is to exceed the expectations of the hundreds of thousands of patients we serve each year by providing high quality of care in a friendly and encouraging environment. Our strategy includes: Exceeding customer expectations and providing the right care at the right place at the right time; Building new and strengthening existing relationships with referral sources, payors and employees; Allocating available capital to support growth initiatives related to same-clinic sales, de novo and acqui-novo clinic openings and selective mergers and acquisitions activity; and Table of Contents The information in this prospectus is not complete and may be changed. The Selling Securityholders named in this prospectus may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 11, 2022 Preliminary Prospectus ATI Physical Therapy, Inc. 9,807,085 shares of Common Stock 11,498,401 Warrants Up to 11,498,401 shares of Common Stock Issuable upon Exercise of the Warrants This prospectus relates to: (1) the issuance by us of up to 5,226,546 shares of Class A common stock, par value $0.0001 per share ( Common Stock ), of ATI Physical Therapy, Inc., a Delaware corporation (the Company, we, our ) that may be issued upon exercise of warrants at an exercise price of $3.00 per share (the Series I Warrants ), (2) the issuance by us of up to 6,271,855 shares of Common Stock issuable upon the exercise of warrants at an exercise price of $0.01 per share ( Series II Warrants and together with the Series I Warrants, the Warrants ), (3) the offer and sale, from time to time by the selling security holders identified in this prospectus (the Selling Securityholders ), or their permitted transferees of up to 9,807,085 shares of Common Stock currently outstanding and 11,498,401 Warrants. This prospectus provides you with a general description of such securities and the general manner in which we and the Selling Securityholders may offer or sell the securities. More specific terms of any securities that we and the Selling Securityholders may offer or sell may be provided in a prospectus supplement that describes, among other things, the specific amounts and prices of the securities being offered and the terms of the offering. The prospectus supplement may also add, update or change information contained in this prospectus. We will not receive any proceeds from the sale of the securities under this prospectus, although we could receive up to approximately $15,742,356.55 for the issuance by us of the Common Stock registered under this prospectus assuming the exercise of all the outstanding Warrants, to the extent such warrants are exercised for cash. However, we will pay the expenses associated with the sale of securities pursuant to this prospectus. Any amounts we receive from such exercises will be used for working capital and other general corporate purposes. Information regarding the Selling Securityholders, the amounts of shares of Common Stock that may be sold by them and the times and manner in which they may offer and sell the shares of Common Stock under this prospectus is provided under the sections entitled Selling Securityholders and Plan of Distribution, respectively, in this prospectus. The Selling Securityholders may sell any, all, or none of the securities offered by this prospectus. The Selling Securityholders and intermediaries through whom such securities are sold may be deemed underwriters within the meaning of the Securities Act of 1933, as amended, with respect to the securities offered hereby, and any profits realized or commissions received may be deemed underwriting compensation. We have agreed to indemnify certain of the Selling Securityholders against certain liabilities, including liabilities under the Securities Act. You should read this prospectus and any prospectus supplement or amendment carefully before you invest in our securities. Our Common Stock and our Public Warrants (as such term is defined under Selected Definitions ), which are not being registered hereunder, are listed on the New York Stock Exchange, or NYSE, under the symbol ATIP and ATIP WS respectively. On April 8, 2022, the last reported sale prices of our Common Stock was $1.81 per share and the last reported sales price of our Public Warrants was $0.28 per Public Warrant. Investing in our Common Stock involves a high degree of risk. See Risk Factors beginning on page 10 of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities, or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022 Table of Contents MARKET AND OTHER INDUSTRY DATA Certain market and industry data included in this prospectus, including the size of certain markets and our size or position within these markets, including our products, are based on estimates of our management and third-party reports. Management estimates have been derived from our management s knowledge and experience in the markets in which we operate, as well as information obtained from surveys, reports by market research firms, our customers, distributors, suppliers, trade and business organizations and other contacts in the markets in which we operate, which, in each case, we believe are reliable. We are responsible for all of the disclosure in this prospectus and while we believe the data from these sources to be accurate and complete, we have not independently verified data from these sources or obtained third-party verification of market share data and this information may not be reliable. In addition, these sources may use different definitions of the relevant markets. Data regarding our industry is intended to provide general guidance but is inherently imprecise. Assumptions and estimates of our future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in Risk Factors Risks Relating to our Business and Industry. These and other factors could cause our future performance to differ materially from our assumptions and estimates. See Cautionary Notes Regarding Forward-Looking Statements . SELECTED DEFINITIONS Unless stated in this prospectus or the context otherwise requires, references to: Amended and Restated Bylaws means the certain Amended and Restated Bylaws of the Company, adopted at the closing of the Business Combination. ATI means ATI Physical Therapy, Inc. (f/k/a Fortress Value Acquisition Corp. II prior to the consummation of the Business Combination) and its consolidated subsidiaries. A&R RRA means that certain Amended and Restated Registration Rights Agreement, as amended, effective at the closing of the Business Combination, by and among FAII, Fortress Acquisition Sponsor II LLC and the other parties thereto. The Board, Board of Directors or our Board means the board of directors of ATI. Closing Date means June 16, 2021. Common Stock means the shares of Class A common stock, par value $0.0001 per share, of ATI. Earnout Shares means the up to an additional 15,000,000 shares of Common Stock Wilco Acquisition and its designees have a contingent right to receive pursuant to the earnout provisions in the Merger Agreement. Exchange Act means the Securities Exchange Act of 1934, as amended. FAII means Fortress Value Acquisition Corp. II, a Delaware corporation (n/k/a ATI Physical Therapy, Inc. following the consummation of the Business Combination). FAII Class A common stock means the shares of Class A common stock, par value $0.0001 per share, of FAII, (following the consummation of the Business Combination, Common Stock ). FAII Class F common stock means the shares of Class F common stock, par value $0.0001 per share, of FAII, which upon consummation of the Business Combination were converted into FAII Class A common stock. Founder Shares means shares of FAII Class F common stock initially purchased by the Insiders whether or not converted into shares of FAII Class A common stock. Table of Contents Integrating our services earlier in the overall process for the evaluation and treatment of musculoskeletal ( MSK ) conditions. On August 25, 2021, the Company entered into an agreement to divest its Home Health service line. On October 1, 2021, the transaction closed with a sale price of $7.3 million. During the fourth quarter of 2021, the Company completed 3 acquisitions consisting of 7 total clinics. With these acquisitions, the Company expanded its footprint in both Michigan and Texas. Recent Developments 2022 credit agreement, Series A Senior Preferred Stock and warrants On the Refinancing Date, ATI Holdings Acquisition, Inc. (the Borrower ), an indirect subsidiary of the Company, refinanced its outstanding debt by entering into a new 2022 credit agreement. The Company s outstanding 2016 first lien term loan had a principal balance of $555.0 million which was paid down in its entirety on the Refinancing Date. The new 2022 credit agreement includes a senior secured term loan with a principal balance of $500.0 million which matures on February 24, 2028. Borrowings on the new senior secured term loan initially bear interest at a rate equal to the Secured Overnight Financing Rate ( SOFR ), subject to a 1.0% floor, plus 7.25%, and includes step-downs based on our net leverage ratio. We may elect to pay 2.0% interest in-kind at a 0.5% premium during the first year under the agreement. The 2022 credit agreement contains customary covenants and restrictions, including financial and non-financial covenants. The financial covenants require us to maintain $30.0 million of minimum liquidity through the first quarter of 2024. Additionally, beginning in the second quarter of 2024, we must maintain a net leverage ratio, as defined in the agreements, not to exceed 7.00:1.00. The net leverage ratio covenant contains a step-down in the third quarter of 2024 to 6.75:1.00 and an additional step-down in the first quarter of 2025 to 6.25:1.00, which remains applicable through maturity. The 2022 credit agreement includes a super priority revolving credit facility which has a maximum borrowing capacity of $50.0 million and matures on February 24, 2027. Borrowings on the new revolving credit facility bear interest at the Company s election, at a base interest rate of the ABR, as defined in the credit agreement, plus a credit spread or SOFR plus an applicable credit spread adjustment plus 4.0%. The interest rate related to borrowings on the revolving credit facility includes step-downs, and includes adjustments based on our net leverage ratio. On the Refinancing Date, we entered into a Series A Senior Preferred Stock Purchase Agreement with the Investors, pursuant to which the Investors purchased, in the aggregate, 165,000 shares of Series A Preferred Stock, together with warrants to purchase up to 11,498,401 shares of Common Stock, for an aggregate purchase price of $163,350,000. The Series A Preferred Stock has priority over the Common Stock with respect to distribution rights, liquidation rights and dividend rights. The holders of the Series A Preferred Stock are entitled to cumulative dividends on the preferred shares at an initial dividend rate of 12.0%, which are payable in-kind, increasing 1.0% per annum on the first day following the fifth anniversary of the issuance and each one-year anniversary thereafter. However, from and after the third anniversary of the issuance of such preferred equity, we have the option to pay such dividends in cash at an interest rate of 1.0% lower than the paid-in-kind rate. The Series A Preferred Stock is perpetual and is mandatorily redeemable in certain circumstances such as a change of control, liquidation, winding up or dissolution, bankruptcy or other insolvency event, restructuring or capitalization transaction, or event of noncompliance. Each Warrant entitles the holder to purchase one share of Common Stock. The Warrants are exercisable within 5 years from issuance. The strike price is $3.00 for the Series I Warrants, and the strike price is $0.01 for the Series II Warrants. Table of Contents TABLE OF CONTENTS ABOUT THIS PROSPECTUS i MARKET AND OTHER INDUSTRY DATA ii SELECTED DEFINITIONS ii CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS iv PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001816906_gaming_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001816906_gaming_prospectus_summary.txt
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001816978_huarui_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001816978_huarui_prospectus_summary.txt
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@@ -0,0 +1 @@
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001817218_convexitys_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001817218_convexitys_prospectus_summary.txt
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@@ -0,0 +1 @@
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001817944_clarus_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001817944_clarus_prospectus_summary.txt
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@@ -0,0 +1 @@
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001819113_science_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001819113_science_prospectus_summary.txt
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001819663_coeptis_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001819663_coeptis_prospectus_summary.txt
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2020-01-01 2020-12-31 0001819663 COEP:PreferredStockSeriesBMember 2021-01-01 2021-12-31 0001819663 us-gaap:CommonStockMember 2021-01-01 2021-12-31 0001819663 us-gaap:AdditionalPaidInCapitalMember 2021-01-01 2021-12-31 0001819663 COEP:CommonStockSubscribedMember 2021-01-01 2021-12-31 0001819663 us-gaap:TreasuryStockMember 2021-01-01 2021-12-31 0001819663 us-gaap:RetainedEarningsMember 2021-01-01 2021-12-31 0001819663 COEP:AssetPurchaseAgreementMember COEP:AniPharmaceuticalsMember 2019-01-01 2019-06-18 iso4217:USD xbrli:shares iso4217:USD xbrli:shares xbrli:pure Table of Contents Registration No. 333-262506 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-1/A (Pre-Effective Amendment No. 1) REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 COEPTIS THERAPEUTICS, INC. (Exact name of registrant as specified in its charter) delaware 5961 83-4284557 (STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION) (PRIMARY STANDARD INDUSTRIAL CLASSIFICATION CODE NUMBER) (I.R.S. EMPLOYER IDENTIFICATION NUMBER) 105 Bradford Rd., Suite 420 Wexford, PA 15090 (724) 934-6467 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) David Mehalick Chief Executive Officer 105 Bradford Rd., Suite 420 Wexford, PA 15090 (724) 934-6467 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copy to: Denis Dufresne, Esq. Louis Lombardo, Esq. Meister Seelig & Fein LLP 125 Park Avenue, 7th Floor New York, New York 10017 Tel: (212) 655-3500 Fax: (212) 655-3535 Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box: If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of large accelerated filer, accelerated filer , smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount to be Registered(1) Proposed Maximum Offering Price Per Share Proposed Maximum Aggregate Offering Price Amount of Registration Fee Common Stock, $0.0001 par value share, held by selling stockholders 7,952,334 $ 2.35 (2) $ 18,687,984.90 $ 1,732.38 Common Stock, $0.0001 par value per share, underlying warrants held by selling stockholders 7,856,766 $ 2.35 (3) $ 18,463,400.10 $ 1,711.56 Total: 15,809,100 $ 37,151,385 $ 3,443.93 (4) (1) In the event of a stock split, stock dividend, or similar transaction involving our common stock, the number of shares registered shall automatically be increased to cover the additional shares of common stock issuable pursuant to Rule 416 under the Securities Act of 1933, as amended ( Securities Act ). (2) Estimated solely for purposes of calculating the registration fee pursuant to Rule 457(c) under the Securities Act. Shares of the registrant s common stock are eligible for trading on the over-the-counter market. The maximum price per share is based on the average of the $2.49 (high) and $2.20 (low) sale price of the registrant s common stock as reported on the over-the-counter market on May 20, 2022. (3) Estimated solely for purposes of calculating the registration fee pursuant to Rule 457(c) under the Securities Act. The maximum price per share is based on the average of the $2.49 (high) and $2.20 (low) sale price of the registrant s common stock as reported on the over-the-counter market on May 20, 2022. (4) $7,583.27 previously paid. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with section 8(a) of the Securities Act of 1933, as amended, or until this registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said section 8(a), may determine. The information in this preliminary prospectus is not complete and may be changed. The selling stockholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion Dated May___, 2022 PRELIMINARY PROSPECTUS COEPTIS THERAPEUTICS, INC. 15,809,100 Shares of Common Stock This prospectus relates solely to the resale of up to an aggregate of 15,809,100 shares of our common stock, par value $0.0001 per share ( common stock ), by the selling stockholders identified in this prospectus. The selling stockholders acquired the shares of common stock offered by this prospectus from us in private placement transactions in reliance on exemptions from registration under the Securities Act of 1933, as amended (the Securities Act ) as more fully described herein. We are registering the resale of these shares of common stock by the selling stockholders to satisfy registration rights we have granted to the selling stockholders. The selling stockholders may offer to sell the shares of common stock being offered in this prospectus at fixed prices, at prevailing market prices at the time of sale, at varying prices, at negotiated prices or through other means described in the section entitled Plan of Distribution. We do not know when or in what amount the selling stockholders may offer these shares of common stock for sale. The selling stockholders may sell some, all or none of the shares of common stock offered by this prospectus. The selling stockholders will receive all proceeds from the sale of the shares of common stock hereunder, and we will not receive any of the proceeds from their sale of the shares of common stock hereunder. We have agreed to pay all expenses relating to registering the shares of common stock being offered in this prospectus. The selling stockholders will pay any brokerage commissions and/or similar charges incurred by them for the sale of the shares of common stock being offered in this prospectus. There is currently a limited public trading market for our common stock. Because all of the shares of common stock being offered in this prospectus are being offered by the selling stockholders, we cannot currently determine the price or prices at which these shares may be sold. Our common stock is quoted on the OTC-Pink tier of the electronic over-the-counter marketplace operated by OTC Markets Group, Inc. under the symbol COEP . On May 20, 2022, the last reported sales price for our common stock was $2.49 per share. We are a smaller reporting company under applicable Securities and Exchange Commission (the SEC ) rules and will be eligible for reduced public company reporting requirements. See Summary We are a Smaller Reporting Company. Investing in our common stock involves significant risks. You should read the section entitled Risk Factors beginning on page 6 for a discussion of certain risk factors that you should consider before investing in our common stock. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read the entire prospectus and any amendments or supplements carefully before you make your investment decision. Neither the SEC nor any other regulatory body has passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022 TABLE OF CONTENTS CERTAIN IMPORTANT INFORMATION ii SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001820630_proterra_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001820630_proterra_prospectus_summary.txt
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+PROSPECTUS SUMMARY The following summary highlights information contained in greater details elsewhere in this prospectus. This summary is not complete and does not contain all of the information you should consider in making your investment decision. You should read the entire prospectus carefully before making an investment in our common stock. You should carefully consider, among other things, our financial statements and related notes and the sections titled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations included elsewhere in this prospectus. Company Overview Proterra s mission is to advance electric vehicle technology to deliver the world s best performing commercial vehicles. Our business is organized into two business units comprised of three business lines, with each business line addressing a critical component of the commercial vehicle electrification: Proterra Powered & Energy is our business unit that provides our technology solutions to commercial vehicle manufacturers and owners of commercial fleets, and is comprised of two business lines. Proterra Powered designs, develops, manufactures, sells, and integrates proprietary battery systems and electrification solutions into vehicles for global commercial vehicle original equipment manufacturer ( OEM ) customers serving the Class 3 to Class 8 vehicle segments, including delivery trucks, school buses, and coach buses, as well as construction and mining equipment, and other applications. Proterra Energy provides turnkey fleet-scale, high-power charging solutions and software services, ranging from fleet and energy management software-as-a-service, to fleet planning, hardware, infrastructure, installation, utility engagement, and charging optimization. These solutions are designed to optimize energy use and costs, and to provide vehicle-to-grid functionality. Proterra Transit is our business unit that designs, develops, manufactures, and sells electric transit buses as an OEM for North American public transit agencies, airports, universities, and other commercial transit fleets. Proterra Transit vehicles showcase and validate our electric vehicle technology platform through rigorous daily use by a large group of sophisticated customers focused on meeting the wide-ranging needs of the diverse communities they serve. The first application of Proterra Powered commercial vehicle electrification technology was through Proterra Transit s heavy-duty electric transit bus, which we designed from the ground up for the North American market. Our industry experience, the performance of our transit buses, and compelling total cost of ownership has helped make us the leader in the U.S. electric transit bus market. With over 800 electric transit buses on the road, our electric transit buses have delivered more than 25 million cumulative service miles spanning a wide spectrum of climates, conditions, altitudes and terrains. From this experience, we have been able to continue to iterate and improve our technology. Our decade of experience supplying battery electric heavy duty transit buses provided us the opportunity to validate our products performance, fuel efficiency and maintenance costs with a demanding customer base and helped broaden our appeal as a supplier to OEMs in other commercial vehicle segments and geographies. Proterra Powered has partnered with more than a dozen OEMs spanning from Class 3 to Class 8 trucks, several types of buses, and multiple off-highway categories. Through December 31, 2021, Proterra Powered has delivered battery systems and electrification solutions for more than 400 vehicles to our OEM partner customers. In addition, Proterra Energy has established itself as a leading commercial vehicle charging solution provider by helping fleet operators fulfill the high-power charging needs of commercial electric vehicles and optimize their Pursuant to Rule 429 under the Securities Act of 1933, as amended, the prospectus filed as part of this registration statement is being filed as a combined prospectus with respect to (A) certain securities previously registered under the registration statement on Form S-1, Registration No. 333-257496, and unsold including (i) the resale of up to an aggregate of 125,389,111 shares of common stock, par value $0.0001 per share ( common stock ), of Proterra Inc (the Company ) by certain selling security holders (including the resale of shares of common stock ( Note Shares ) issuable upon the conversion of certain outstanding convertible promissory notes (the Convertible Notes )) and (ii) the issuance of up to an aggregate of 26,317,092 shares of common stock by the Company upon the exercise of certain outstanding warrants and the conversion of the Convertible Notes; and (B) certain shares of common stock being newly registered hereunder, including (i) the resale of up to an additional 879,167 Note Shares by certain selling security holders and (ii) the issuance of up to an additional 879,167 Note Shares by the Company upon conversion of the Convertible Notes. Pursuant to Rule 429, this registration statement constitutes Post-Effective Amendment No. 1 to the registration statement on Form S-1, Registration No. 333-257496 with respect to the offering of such unsold shares thereunder, which are not currently being terminated by the Company. No other changes shall be deemed to be made to the registration statement on Form S-1, Registration No. 333-257496 other than with respect to the specific shares being sold hereunder. Such post-effective amendment will become effective concurrently with the effectiveness of this registration statement in accordance with Section 8(a) of the Securities Act. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. SELECTED DEFINITIONS Unless otherwise stated in this prospectus or the context otherwise requires, references to: ArcLight, means ArcLight Clean Transition Corp., a Cayman Islands exempted company, prior to the consummation of the Domestication; Board means our board of directors; Business Combination means the Domestication, the Merger and other transactions contemplated by the Merger Agreement, collectively, including the PIPE Financing; Cayman Islands Companies Law means the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; Class A ordinary shares means the Class A ordinary shares, par value $0.0001 per share, of ArcLight, prior to the Domestication, which automatically converted, on a one-for-one basis, into shares of common stock in connection with the Domestication; Class B ordinary shares means the Class B ordinary shares, par value $0.0001 per share, of ArcLight that were initially issued to the Sponsor (a portion of which were subsequently transferred to the other Initial Shareholders) in a private placement prior to ArcLight s initial public offering, and, in connection with the Domestication, which automatically converted, on a one-for-one basis, into shares of common stock; Closing means the closing of the Business Combination; Closing Date means June 14, 2021; common stock means the common stock, par value $0.0001 per share, of Proterra; Computershare means Computershare Inc.; Convertible Notes means the secured convertible promissory notes of Legacy Proterra that became convertible into shares of common stock in connection with the Merger; Domestication means the transfer by way of continuation and deregistration of ArcLight from the Cayman Islands and the continuation and domestication of ArcLight as a corporation incorporated in the State of Delaware; Domestication Date means June 11, 2021; Earnout Shares means the Initial Earnout Shares and the Remaining Earnout Shares; Effective Time means the time at which the Merger became effective; Equity Incentive Plan means the Proterra Inc 2021 Equity Incentive Plan and Equity Incentive Plans means the Proterra Inc 2021 Equity Incentive Plan and the Proterra Inc 2010 Equity Incentive Plan; ESPP means the Proterra Inc 2021 Employee Stock Purchase Plan; GAAP means the United States generally accepted accounting principles, consistently applied; initial public offering means ArcLight s initial public offering that was consummated on September 25, 2020; energy usage, while meeting our customers space constraints and continuous service requirements. As of December 31, 2020, we had installed more than 60 MW of charging infrastructure across North America. We delivered 208 new transit buses in 2021, 170 in 2020, and 177 in 2019. We also delivered 9 pre-owned buses in 2021. We delivered battery systems for 273 vehicles in 2021, 107 vehicles in 2020, and 20 vehicles in 2019. For the years ended December 31, 2021, 2020 and 2019, our total revenue was $242.9 million, $196.9 million, and $181.3 million, respectively. As of December 31, 2021, in aggregate, we have generated revenue of $621.1 million for the past three years. We generated a gross profit of $2.1 million for the year ended December 31, 2021 and a gross profit of $7.5 million for the year ended December 31, 2020, and a gross loss of $1.6 million for the year ended December 31, 2019. We have also invested significant resources in research and development, operations, and sales and marketing to grow our business and, as a result, generated losses from operations of $127.6 million, $96.0 million, and $99.7 million for the years ended December 31, 2021, 2020 and 2019, respectively. Corporate Information We were incorporated on July 28, 2020 as a special purpose acquisition company and a Cayman Islands exempted company under the name ArcLight Clean Transition Corp. On September 25, 2020, ArcLight completed its initial public offering. On June 14, 2021, we consummated the transactions contemplated by Merger Agreement, by and among ArcLight (and, after the Domestication, Proterra), Phoenix Merger Sub, and Legacy Proterra. As contemplated by the Merger Agreement, on June 11, 2021, ArcLight filed a notice of deregistration with the Cayman Islands Registrar of Companies, together with the necessary accompanying documents, and filed a certificate of incorporation and a certificate of corporate domestication with the Secretary of State of the State of Delaware, under which ArcLight was domesticated and continues as a Delaware corporation. Further, on June 14, 2021, as contemplated by the Merger Agreement, Proterra consummated the Merger, whereby Phoenix Merger Sub merged with and into Legacy Proterra, the separate corporate existence of Phoenix Merger Sub ceasing and Legacy Proterra being the surviving corporation and a wholly owned subsidiary of Proterra. Legacy Proterra was incorporated in Delaware on February 2, 2010, and upon the Merger on June 14, 2021 changed its name to Proterra Operating Company, Inc. and continues as a Delaware Corporation. Our address is 1815 Rollins Road, Burlingame, California 94010. Our telephone number is (864) 438-0000. Our website address is www.proterra.com. Information contained on our website or connected thereto does not constitute part of, and is not incorporated by reference into, this prospectus or the registration statement of which it forms a part.
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001828672_boxed-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001828672_boxed-inc_prospectus_summary.txt
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+PROSPECTUS SUMMARY
+This summary highlights, and is qualified in its entirety by, the more detailed information and financial statements included elsewhere in this prospectus. This summary does not contain all of the information that may be important to you in making your investment decision. You should read this entire prospectus carefully, especially the Risk Factors section beginning on page 9 and our consolidated financial statements and the related notes appearing at the end of this prospectus, before deciding to invest in our Common Stock or Warrants.
+Overview
+Boxed is an e-commerce retailer and an e-commerce enabler. We operate an e-commerce retail service that provides bulk pantry consumables to businesses and household customers (our Retail business ). This service is powered by our own purpose-built storefront, marketplace, analytics, fulfillment, advertising, and robotics technologies. We further enable e-commerce through our software & services business, which offers customers in need of an enterprise-level e-commerce platform access to our end-to-end technology (our Software & Services business ).
+Founded in 2013 by an experienced group of tech pioneers, we have been a technology-first organization since our inception. The founders (including current Chief Executive Officer Chieh Huang and Chief Operating Officer Jared Yaman) had a simple idea: make shopping for bulk, household essentials easy, convenient and fun so customers can focus their time and energy on the things that really matter, instead of spending their weekends traveling to and shopping in traditional brick-&-mortar wholesale clubs with their families. From that initial concept, we grew into the e-commerce technology company that it is today, with our own purpose-built storefront, analytics, fulfillment, advertising, and robotics technologies. Now, in addition to offering B2C and B2B customers with bulk consumables, such as paper products, snacks, beverages, and cleaning supplies, we have also begun to drive high-margin revenue through our Software & Services business, helping the world to stock up through our technology. Since our inception, we have been engaged in developing and expanding our Retail and Software & Services businesses.
+Summary Risk Factors
+Our business is subject to a number of risks of which you should be aware before making an investment decision. These risks are discussed more fully in the Risk Factors section of this prospectus immediately following this prospectus summary. These risks include the following:
+ If we fail to acquire new customers and retain existing customers, or fail to do so in a cost-effective manner, we may be unable to increase net revenue, improve gross margins or achieve or sustain profitability.
+ There is no assurance that we will successfully integrate MaxDelivery, the on-demand grocery delivery business we acquired in December 2021, and expand that business and revenues by adding on-demand grocery service fulfillment centers in select targeted markets.
+ We have a history of operating losses and may never be able to achieve or maintain profitability.
+ Failure to effectively develop and expand our marketing and sales capabilities could harm our ability to increase our customer base and achieve broader market acceptance of our platform.
+ We operate in a rapidly evolving market and face intense competition, especially from larger and more established companies. We may lack sufficient financial or other resources to maintain or improve our competitive position, which may harm our ability to add new customers, retain existing customers, and grow our business.
+ The growth and performance of our business depend on our ability to accurately predict consumer trends and seasonality, successfully introduce new products, improve existing products, attract vendors to list such products and expand our offerings to respond to our users and vendors changing needs.
+
+4
+
+Table of Contents
+
+ We only recently launched our Software & Services business and have limited experience in successfully delivering such services to customers or in marketing the offering to a broader customer set. Our results of operations and future revenue prospects will be harmed if we are unable to increase the adoption of its offerings.
+ The performance of our business may be adversely affected by changes in the nature in which businesses are operated following the COVID-19 pandemic and by the timing and long-term approach toward the return to traditional workplaces and work schedules.
+ If we fail to develop and successfully introduce new Software & Services offerings, or fail to maintain existing products and services that are significant to our retail partners, or if we are unable to anticipate and respond to rapid changes in technology or industry trends, our business, growth expectations, and financial condition may be materially and adversely affected.
+ We may be unable to source additional, or strengthen our existing relationships with, vendors. In addition, the loss of any of our key vendors would negatively impact our business.
+ We may be unable to sustain or improve our customer loyalty offerings, which could lead to reduced customer engagement and retention, and adversely affect our business, financial condition and results of operations and rate of growth.
+ Food safety, quality, and health concerns could affect our business.
+ If we do not successfully optimize, operate and manage the expansion of the capacity of our fulfillment centers, or if we lose access to one or more of our fulfillment centers, our business, financial condition, and results of operations could be harmed.
+ Packaging and shipping products are critical parts of our business and any changes in, or disruptions to, our packaging and shipping vendor arrangements could adversely affect our business, financial condition, and results of operations.
+ Our business depends on network and mobile infrastructure, our third-party data center hosting facilities, other third-party providers, and our ability to maintain and scale our technology. Any significant interruptions or delays in service on our website or mobile applications or any undetected errors or design faults could result in limited capacity, reduced demand, processing delays, and loss of customers or vendors. A failure to adequately resolve such defects and implement new systems could harm our business and adversely affect our results of operations.
+ We are subject to risks related to online transactions and payment methods.
+ We rely on the performance of members of management and highly skilled personnel, and if we are unable to attract, develop, motivate and retain well-qualified employees, including due to evolving labor dynamics, our business could be harmed.
+ We may be unable to adequately protect our brand and our other intellectual property rights. Additionally, we may be subject to intellectual property infringement claims or other allegations, which could result in substantial damages and diversion of our management s efforts and attention.
+ The Convertible Notes issued and outstanding upon the Closing may impact our financial results, result in the dilution of our stockholders, create downward pressure on the price of our Common Stock, and restrict our ability to raise additional capital or take advantage of future opportunities.
+ We are subject to extensive governmental regulation and we may incur material liabilities under, or costs in order to comply with, existing or future laws and regulation, and our failure to comply may result in enforcements, recalls, and other adverse actions.
+ Actual or perceived failures to comply with federal, state and international laws and regulations, our contractual obligations, or standards and other requirements relating to privacy, data protection and consumer protection could adversely affect our 
+
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+business and financial condition, including by causing damage to our reputation with customers and retail partners, or resulting in our incurring substantial additional costs or becoming subject to litigation.
+ Operating as a public company will require us to incur substantial costs and will require substantial management attention. In addition, our management team has limited experience managing a public company and the requirements of being a public company may strain our resources, divert management s attention and affect our ability to attract and retain additional executive management and qualified board members.
+ Our need to raise additional capital in the future to execute on our business plan and meet the financial covenants included in our term loan raise substantial doubt about our ability to continue as a going concern.
+ It is not possible to predict the actual number of shares, if any, we will sell under the Purchase Agreement to the Investor, or the actual gross proceeds resulting from those sales.
+
+Corporate Information
+We were incorporated under the laws of the state of Delaware on September 23, 2020 under the name Seven Oaks Acquisition Corp. Upon the closing of the Business Combination, we changed our name to Boxed, Inc. Our Common Stock and Warrants are listed on NYSE under the symbols BOXD and BOXD WS, respectively. Our principal executive offices are located at 451 Broadway, New York, NY 10013, and our telephone number is (646) 586-5599. Our website address is www.boxed.com. The information contained in, or accessible through, our website does not constitute a part of this prospectus. We have included our website address in this prospectus solely as an inactive textual reference.
+Emerging Growth Company
+As a company with less than $1.07 billion in revenue during our last fiscal year, we qualify as an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012, as amended (the JOBS Act ). An emerging growth company may take advantage of reduced reporting requirements that are otherwise applicable to public companies. These provisions include, but are not limited to:
+ not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes- Oxley Act of 2002, as amended (the Sarbanes-Oxley Act );
+ not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis);
+ reduced disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements; and
+ exemptions from the requirements of holding a nonbinding advisory vote of stockholders on executive compensation, stockholder approval of any golden parachute payments not previously approved and having to disclose the ratio of the compensation of our chief executive officer to the median compensation of our employees.
+
+We may take advantage of these provisions until the last day of our fiscal year following the fifth anniversary of the completion of the initial public offering of Seven oaks Acquisition Corp. However, if (i) our annual gross revenue exceeds $1.07 billion, (ii) we issue more than $1.0 billion of non-convertible debt in any three-year period or (iii) we become a large accelerated filer (as defined in Rule 12b-2 under the Exchange Act) prior to the end of such five-year period, we will cease to be an emerging growth company. We will be deemed to be a large accelerated filer at such time that we (a) have an aggregate worldwide market value of common equity securities held by non-affiliates of $700.0 million or more as of the last business day of our most recently completed second fiscal quarter, (b) have been required to file annual and quarterly reports under the Exchange Act, for a period of at least 12 months and (c) have filed at least one annual report pursuant to the Exchange Act.
+
+6
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+
+We have elected to take advantage of certain of the reduced disclosure obligations in the registration statement of which this prospectus is a part and may elect to take advantage of other reduced reporting requirements in future filings. As a result, the information that we provide to our stockholders may be different than you might receive from other public reporting companies in which you hold equity interests.
+In addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. We have elected to use the extended transition period for complying with new or revised accounting standards. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates.
+ 
+
+7
+
+Table of Contents
+
+THE OFFERING
+Issuer
+
+Boxed, Inc
+
+Common Stock offered by the Holder
+Up to 15,000,000 shares of Common Stock, consisting of
+
+ 
+ 
+
+114,585 Commitment Fee Shares that we issued to the Holder in consideration of its commitment to purchase common stock at our election under the Purchase Agreement; and
+
+ 
+ 
+
+Up to 14,885,415 shares of Common Stock that we may elect, in our sole discretion, to issue and sell to the Holder, from time to time under the Purchase Agreement.
+
+Use of Proceeds
+
+We will not receive any proceeds from any sale of Common Stock by the Holder. However, we may receive up to $100.0 million in aggregate gross proceeds from the Holder under the Purchase Agreement in connection with sales of our Common Stock to the Holder pursuant to the Purchase Agreement after the date of this prospectus. We intend to use any proceeds from the CCOD Facility for working capital and general corporate purposes. See Use of Proceeds. 
+
+Market for Common Stock
+
+The Common Stock is currently traded on the New York Stock Exchange under the symbol BOXD. 
+
+Conflict of Interest
+
+The Holder is an affiliate of JonesTrading Institutional Investments ( JonesTrading ) a FINRA member. JonesTrading is expected to act as an executing broker for the sale of shares of Common Stock sold by the Holder pursuant to the CCOD Facility.
+The receipt by the Holder of all of the proceeds from sales of Common Stock to the public made through JonesTrading results in a conflict of interest under Financial Industry Regulatory Authority, Inc. ( FINRA ) Rule 5121. Accordingly such sales will be conducted in compliance with FINRA Rule 5121. See Plan of Distribution (Conflict of Interest). 
+
+Risk Factors
+
+See Risk Factors and other information included in this prospectus for a discussion of factors you should consider before investing in our securities.
+
+ 
+For additional information concerning the offering, see Plan of Distribution (Conflict of Interest). 
+ 
+ 
+
+8
+
+Table of Contents
+
+RISK FACTORS
+You should carefully consider the risks and uncertainties described below and the other information in this prospectus before making an investment in our Common Stock . Our business, financial condition, results of operations, or prospects could be materially and adversely affected if any of these risks occurs, and as a result, the market price of our Common Stock could decline and you could lose all or part of your investment. This prospectus also contains forward-looking statements that involve risks and uncertainties. See Cautionary Statement Regarding Forward-Looking Statements. Our actual results could differ materially and adversely from those anticipated in these forward-looking statements as a result of certain factors, including those set forth below.
+Risks Related to Our Business and Operations
+If we fail to acquire new customers and retain existing customers, or fail to do so in a cost-effective manner, we may be unable to increase net revenue, improve gross margins, or achieve or sustain profitability.
+Our success depends on our ability to acquire new customers and retain existing customers and to do so in a cost-effective manner. In order to expand our customer base, we must appeal to, and acquire, customers who have historically purchased their household and business essentials in bulk from other retailers such as traditional brick-and-mortar retailers, the websites of our competitors, or our vendors own websites. We have made significant investments related to customer acquisition, including our acquisition in December 2021 of substantially all of the assets of MaxDelivery, LLC to acquire their customers and expand our product offerings, and expect to continue to spend significant amounts to acquire additional customers. There can be no assurance that we will achieve the anticipated increase in net revenue and profitability from our investment in that acquisition, including the costs of integration, or any other acquisition to expand our business.
+The paid marketing channels we invest in include search engine marketing, direct mail, display, television, radio and magazine advertising, paid social media, influencer campaigns, and product placement. We drive a significant amount of traffic to our website via search engines and, therefore, rely on their efficacy and targeting. Search engines frequently update and change the logic that determines the placement and display of results of a user s search, such that the purchased or algorithmic placement of links to our website can be negatively affected. Moreover, a search engine could, for competitive or other purposes, alter its search algorithms or results, causing our website to place lower in search query results.
+We also drive a significant amount of traffic to our website via social networking or other e-commerce channels used by our current and prospective customers. As social networking and e-commerce channels continue to rapidly evolve, we may be unable to develop or maintain a meaningful presence within these channels. If we are unable to cost-effectively drive traffic to our website, our ability to acquire new customers and our financial condition would be materially and adversely affected. Additionally, if we fail to increase our net revenue per active customer, generate repeat purchases or maintain high levels of customer engagement and retention, our business, financial condition, and results of operations could be materially and adversely affected.
+We cannot assure you that the net revenue and/or profit generated from the new customers we acquire will ultimately exceed the cost of acquiring those customers. If we fail to deliver a quality shopping experience, if we fail to offer products consumers purchase regularly or if consumers do not perceive the products we offer to be of high value and quality, we may be unable to acquire or retain customers. If we are unable to acquire or retain customers who purchase products in volumes sufficient to grow our business, we may be unable to generate the scale necessary to achieve operational efficiency and drive beneficial network effects with our vendors. Consequently, our prices may increase, or may not decrease to levels sufficient to maintain customer interest, our net revenue may decrease and our gross margins and profitability may decline or not improve. As a result, our business, financial condition, and results of operations may be materially and adversely affected.
+We believe that many of our new customers originate from word-of-mouth and other non-paid referrals from our customers. Therefore, we must ensure that our customers remain loyal to us in order to continue receiving those referrals. If our efforts to satisfy our customers are not successful, we may be unable to acquire new customers in sufficient numbers to continue to grow our business, and we may be required to incur significantly higher marketing expenses in order to acquire new customers.
+
+9
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+Table of Contents
+
+There is no assurance that we will successfully integrate the MaxDelivery on-demand grocery delivery business we acquired in December 2021, or expand that business and revenues by adding on-demand grocery service fulfillment centers in select targeted markets.
+As a result of our acquisition of MaxDelivery, an on-demand grocery delivery business, in December 2021, we are in the process of expanding our perishable and fresh assortment offering to our customers. Currently, with the acquisition, customers within select zip-codes in Manhattan (New York City) now have access to an additional assortment of approximately 10,000 SKUs across a broad range of grocery categories, including fresh fish, meats, produce, dairy, and other perishable categories which Boxed has not historically offered broadly. We have plans to expand this business by adding fulfillment centers in other select target markets (zip codes) in 2022 and to further increase expansion in future periods. Expansion requires investment capital and additional personnel to identify, negotiate and complete lease agreements, procure operations equipment, recruit and hire workers, expand supply sources and operate the additional fulfillment centers. There is no assurance that we will have the necessary financial and human capital or the capacity to accomplish these objectives. The failure to do so will adversely impact our results of operations.
+Failure to effectively develop and expand our marketing and sales capabilities could harm our ability to increase our customer base and achieve broader market acceptance of our platform. If we are not able to generate traffic to our website through our marketing efforts, our ability to attract new customers may be impaired.
+Our ability to increase our customer base and achieve broader market acceptance of our e-commerce platform will depend on, among other things, our ability to expand our marketing and sales operations. We plan to continue expanding our sales force and strategic partners, both domestically and internationally. We also plan to dedicate significant resources to sales and marketing programs, including advertisement placed in television and streaming programs, social media, search engine and other online advertising. Our messaging may not resonate with potential new customers to drive sufficient traffic to our website or generate the anticipated incremental orders on our platform to justify the investment. The effectiveness of our online advertising may continue to vary due to competition for key search terms, changes in search engine use, and changes in search algorithms used by major search engines and other digital marketing platforms. The ability to spend on sales and marketing programs will be impacted by available cash from operations with any reduction in marketing spend having potential negative consequences of lower customer acquisition and retention. Further, business and operating results will be harmed if our sales and marketing efforts do not generate a corresponding increase in revenue. We may not achieve anticipated revenue growth from expanding our sales force if we are unable to hire, develop, and retain talented sales personnel, if our new sales personnel are unable to achieve desired productivity levels in a reasonable period of time, or if our sales and marketing programs are not effective.
+If the cost of marketing our platform over social media, search engines or other digital marketing platforms increases, our business and operating results could be adversely affected. Competitors also may bid on the search terms that we use to drive traffic to our website. Such actions could increase our advertising costs and result in decreased traffic to our website.
+Furthermore, search engines and digital marketing platforms may change their advertising policies from time to time. If these policies delay or prevent us from advertising through these channels, it could result in reduced traffic to our website and subscriptions to our platform. New search engines and other digital marketing platforms may develop, particularly in specific jurisdictions, that reduce traffic on existing search engines and digital marketing platforms. If we are not able to achieve prominence through advertising or otherwise on these new platforms, we may not achieve significant traffic to our website through these new platforms and our business and operating results could be adversely affected.
+If we fail to maintain or grow our brand recognition, our ability to expand our customer base will be impaired and our financial condition may suffer.
+We believe maintaining and growing our brand is important to supporting continued acceptance of our existing and future offerings, attracting new customers to our platform, and retaining existing customers. We also believe that the importance of brand recognition will increase as competition in our market increases. Successfully maintaining our brand will depend largely on the effectiveness of our marketing efforts and special incentives and promotions, our ability to provide a reliable and useful platform, including online and mobile applications, our ability to meet the needs of our customers at competitive prices, our ability to maintain our customers trust, our ability to continue to develop new functionality and solutions, and our ability to successfully differentiate our platform. Additionally, our partners performance, such as our shipping partners or payment processor, may affect our brand and reputation if customers do not have a positive experience. Brand promotion activities may not generate customer awareness or yield 
+
+10
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+Table of Contents
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+increased revenue as intended. Even if they do, any increased revenue may not offset the expenses we incurred in building our brand or in generating that revenue. If we fail to successfully promote and maintain our brand, we may fail to attract enough new customers or retain our existing customers to realize a sufficient return on our brand-building efforts, and our business could suffer.
+We operate in a rapidly evolving market and face intense competition, especially from larger and more well-established companies. We may lack sufficient financial or other resources to maintain or improve our competitive position, which may harm our ability to add new customers, retain existing customers, and grow our business.
+Our market is highly competitive and characterized by rapid changes in technology and consumer sentiment. Competition in our industry has intensified, particularly in e-commerce, and we expect this trend to continue as the list of our competitors grows. This competition, among other things, affects our ability to attract new users and engage and retain our existing users.
+We compete with e-commerce platforms and other retailers for vendors on our platform and vendors can sell their goods on a number of other e-commerce platforms, such as Amazon.com or Walmart.com. In addition, we compete for vendors with traditional brick-and-mortar retail stores that may also have an online presence such as Costco, BJ s Wholesale and Sam s Club.
+There are various factors that affect whether and how vendors engage with our platform, including:
+ the number and engagement of users on our platform and the volume of vendor products sold;
+ our fees;
+ our brand awareness;
+ our reputation;
+ the quality of our services; and
+ the functionality of our platform, including data and analytics offerings.
+
+We also compete with retailers for the attention of customers. A customer has the choice of shopping with any online or offline retailer, whether large e-commerce marketplaces, such as Amazon.com, Walmart.com, and Target.com, as well as more traditional discount retailers, such as Walmart, Costco or Target, or local stores or other venues or marketplaces. Many of these competitors offer broader and more varied product assortment, low-cost or free shipping, fast shipping times, in-store pick-up alternatives, favorable return policies, and other features that may be difficult or impossible for us to match.
+There are various factors that affect whether and how customers engage with our platform, including:
+ our brand awareness and recognition;
+ our reputation;
+ the prices of goods sold on our platform;
+ the functionality of our platform;
+ ease of payment;
+ shipping terms;
+ the breadth of the products sold on our platform; and
+ customer service and support.
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+Some of our competitors have, and potential competitors may have, longer operating histories, greater financial, technical, marketing, institutional and other resources, broader product assortment, faster shipping times, lower-cost shipping, larger databases, greater name and brand recognition, or a larger base of customers or vendors than we do. They may devote greater resources to the development, marketing, and promotion of their services than we do, and they may offer lower pricing or free shipping to the customers on their platforms. These factors may allow our competitors to derive greater revenue and profits from their existing customer and vendor bases, acquire customers at lower costs or respond more quickly than we can to new or emerging technologies and changes in trends and consumer shopping behavior. If we are unable to compete successfully, or if competing successfully requires us to expend greater resources to attract and retain customers at sufficient order volumes, our financial condition and results of operations could be adversely affected.
+The growth and performance of our business depend on our ability to accurately predict consumer trends and seasonality and take appropriate action, successfully introduce new products, improve existing products, attract vendors to offer such products, and expand our offerings to respond to our customers and vendors changing needs.
+Our growth depends, in part, on our ability to successfully introduce new products and services, and improve and reposition our existing products and services to meet the requirements of our customers, both consumers and businesses. As we work to grow our Retail business, which consists of sales of retail goods to both our B2B and B2C customers, the development and introduction of innovative new products and services and expansion into new offerings involves considerable costs. In addition, it may be difficult to grow existing vendor relationships by expanding product offerings, establish new vendor relationships and determine appropriate product selection when developing a new product, service or offering. Any new product, service or offering may not generate sufficient customer interest and sales to become profitable or to cover the costs of its development and promotion and, as a result, may reduce our operating income. In addition, any such unsuccessful effort may adversely affect our brand and reputation. If we are unable to anticipate, identify, develop or market products, services or any new offerings that respond to changes in customer requirements and preferences, or if our new product or service introductions, repositioned products or services, or new offerings fail to gain customer acceptance, we may be unable to grow our business as anticipated, our sales may decline and our gross margins and profitability may decline or not improve. As a result, our business, financial condition, and results of operations may be materially and adversely affected.
+In addition, while we plan to continue to invest in the development of our business, including in the expansion of our offering of private-label brand products, we may be unable to maintain or expand sales of our private-label brand products for a number of reasons, including the loss of key vendors and product recalls. Maintaining consistent product quality, competitive pricing, and availability of our private-label brand products for our customers is essential to developing and maintaining customer loyalty and brand awareness. Our private-label brand products on average provide us with higher gross margins than the comparable third-party brand products that we sell. Accordingly, our inability to sustain the growth and sales of our private-label brand offerings may materially and adversely affect our projected growth rates, business, financial condition, and results of operations.
+We may be unable to accurately forecast net revenue and appropriately plan our expenses and investments in the future.
+Net revenue and results of operations are difficult to forecast because they generally depend on the number of customers we acquire and retain, customer behavior on our platform, our ability to supply or be in-stock of the products our customers demand, as well as the volume, timing and type of orders we receive, all of which are uncertain. We base our expense levels and investment plans on our estimates of net revenue and gross margins. We cannot be sure that historical growth rates, trends, and other key performance metrics are meaningful predictors of future growth. If our assumptions and forecasts prove to be wrong, we may spend more than we anticipate acquiring and retaining customers or may generate lower net revenue per active customer than anticipated, either of which could have a negative impact on our business, financial condition, and results of operations.
+Our Retail business is moderately seasonal and weak performance during one of our historically strong seasonal periods could have a material adverse effect on our operating results for the entire fiscal year.
+Our Retail business is moderately seasonal, with a meaningful portion of our sales and promotional campaigns dedicated to back-to-school and back-to-work time periods, typically resulting in the realization of higher portions of net revenue in the first and third fiscal quarters. Due to the importance of our peak sales periods, which include the post-holiday winter and fall seasons, the first and third fiscal quarters have historically contributed, and are expected to continue to contribute, significantly to our operating results for the entire fiscal year. In anticipation of seasonal increases in sales activity during these periods, we incur additional expense prior to 
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+and during our peak seasonal periods. These expenses may include the acquisition of additional inventory, seasonal staffing needs and other similar items. As a result, any factors negatively affecting us during these periods, including adverse weather, spread of seasonal infectious diseases and unfavorable economic conditions, could have a material adverse effect on our results of operations for the entire fiscal year. Due to COVID-19 and the disruption of typical back-to-school and back-to-work time periods, the dynamics of our seasonality have changed slightly and are less predictable, making it more challenging to have the necessary goods available at peak sales periods or to hold too much inventory due to a delay in the anticipated typical seasonal peak periods. We expect our seasonality to return to the normal peak sale periods in the future as the impact of COVID-19 subsides.
+We only recently launched our Software & Services business and have limited experience in successfully delivering such services to customers or in marketing the offering to a broader customer set. Our results of operations and future revenue prospects will be harmed if we are unable to increase the adoption of our offerings.
+We expect our Software & Services business, encompassing licensing of our software and technology assets and associated implementation fees, will be an increasingly important part of our offerings as we expand our business internationally. However, we have limited experience in successfully marketing or delivering these services to customers, and if we are not able to do both in a timely manner, we would fail to achieve the anticipated benefits of our Software & Services offering. Additionally, if our services, that include other third-party services, become unavailable due to extended outages or interruptions or because they are no longer available on commercially reasonable terms, or for any other reason, our processes for supporting our customers could be impaired, our ability to communicate with our vendors could be weakened and our ability to access or save data stored to the cloud may be impaired until equivalent services, if available, are identified, obtained and implemented, all of which could harm our business, financial condition, and results of operations. The success of our early operations of our Software & Services offerings, or lack thereof, may significantly impact our future business, results of operations and financial condition.
+In addition, the attractiveness of our platform depends, in part, on our ability to integrate third-party applications and services which our registered users desire, into their websites, or develop and offer those applications independently. Third-party application providers may change the features of their applications and platforms or alter the terms governing the use of their applications and platforms in an adverse manner. Further, third-party application providers may discontinue their engagement with us, or refuse to partner with us, or limit or restrict our access to their applications and platforms. Such changes could functionally limit or terminate our ability to use these third-party applications and platforms with our platform, which could negatively impact our offerings and harm our business. Additionally, competitors may offer functionality which our registered users desire, that is better than the functionality of third-party applications or integrated solutions in our platform. If we fail to integrate our platform with new third-party applications that our registered users need for their websites or develop them independently, or adapt to the data transfer requirements of such third-party applications and platforms or any other requirements, we may not be able to offer the functionality that our registered users expect, which would negatively impact our offerings and, as a result, harm our business.
+Our business will suffer if the B2C market proves less lucrative than projected or if we fail to effectively acquire, retain and service individual B2C customers.
+A majority of our revenue is generated from sales to individual B2C customers. Individual customers may have limited budgets and may choose to allocate their spending to items other than our offerings, especially in times of economic uncertainty or recessions. We intend to continue to devote substantial resources to the B2C market, including through sales of our private-label products and through sales from our direct vendors and third-party marketplace sellers. Among other things, we aim to grow our revenues by adding new consumer customers and encouraging existing customers to engage with our Boxed Up loyalty program. If the B2C market fails to be as lucrative as we project or we are unable to market and sell our services to individual customers effectively, directly or through our vendors, our ability to grow our revenues and become profitable will be harmed.
+If our online Retail business platform used in our Retail e-commerce business or by our Software & Services customers licensing the platform fails to perform properly or if we fail to develop enhancements to resolve performance issues or respond to other user concerns, we could lose customers and incur significant costs.
+Our operations are dependent upon our ability to prevent system interruption. The applications underlying our online Retail business platform are inherently complex and may contain or develop material defects or errors, which may cause disruptions in availability or other performance problems. Defects, errors, disruptions in service, cyber-attacks, or other performance problems with our software, whether in connection with the day-to-day operation, upgrades or otherwise, could result in loss of customers, lost or 
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+delayed market acceptance and licenses of our e-commerce platform in our Software & Services business, delays in payment to us by customers, injury to our reputation and brand, legal claims, including warranty and service claims, against us, diversion of our resources, including through increased service and warranty expenses or financial concessions, and increased insurance costs.
+We have found defects in our online Retail business platform from time to time and may discover additional defects in the future that could result in data unavailability, unauthorized access to, loss, corruption, or other harm to our customers data. We may not be able to detect and correct defects or errors before license to our Software & Services customers. Consequently, we or our customers may discover defects or errors after our platform has been employed. We implement bug fixes and upgrades as part of our regularly scheduled system maintenance. If we do not complete this maintenance according to schedule or if customers are otherwise dissatisfied with the frequency and/or duration of our maintenance services and related system outages, customers could terminate their contracts, delay or withhold payment to us, or cause us to issue credits, make refunds, or pay penalties. The costs incurred or delays resulting from the correction of defects or errors in our software or other performance problems may be substantial and could adversely affect our operating results.
+Our Software & Services operations are susceptible to risks associated with international operations and the use of our platform in various countries, including in emerging markets, and we may not be able to localize our Software & Services business for use in such countries.
+We expect to have users of our e-commerce platform worldwide, and we expect to continue to increase the volume of our operations worldwide in the future as we expand our strategic partnerships. However, our operations in various countries subject us to risks which may include:
+ difficulties related to contract enforcement, including our terms of use;
+ compliance with foreign laws and regulations applicable to cross-border operations including export controls;
+ customization of our Software & Services business to be compliant with local laws and regulations applicable to our users and their customers;
+ monitoring changes and addressing conflicting laws in areas such as consumer protection, taxation, anti-money laundering and copyright;
+ lower levels of Internet availability and use in certain geographical locations;
+ data privacy and data localization laws that may require that user data and data of our users consumers be stored and processed in a designated territory;
+ tax consequences, including the complexities of foreign value-added tax (or other tax) systems and restrictions on the repatriation of earnings;
+ varying economic and political climates;
+ currency exchange rates and restrictions related to foreign exchange controls;
+ different and varied sources of competition;
+ different customer spending levels, in particular in light of the COVID-19 pandemic; and
+ lower levels of credit card use, access to online payment methods, and increased payment risks.
+
+These factors, or other factors, may cause our international costs of doing business to exceed our forecasts and may also require significant management attention and financial resources. Any negative impact from our international business efforts could adversely affect our business, results of operations and financial condition.
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+We are in the process of localizing our platform for international adoption in local markets, including the languages and currencies we use, expanding our systems to accept payments in forms that are common in those targeted markets and tailoring our customer service policies, to provide our users with a local experience and cater to their specific needs. We intend to continue our nascent international expansion efforts, including through partners who can assist us to penetrate new markets. To achieve our goals, we must hire and train experienced personnel to staff and manage our international expansion. Our international expansion efforts may be slow or unsuccessful to the extent that we experience difficulties in recruiting, training, managing and retaining qualified personnel with international experience, language skills and cultural competencies in the geographic markets we target, or if we were to engage with a partner who is not appropriately qualified to operate in local markets. In addition, the expansion of our existing international operations and entry into additional international markets, in particular in emerging markets, has required, and will continue to require, significant management attention and financial resources, particularly in light of the COVID-19 pandemic. We may also face pressure to lower our prices to compete in emerging markets, which could adversely affect revenue derived from our international operations.
+Our efforts to expand our presence in emerging markets presents challenges that are different from those associated with more developed international markets. In particular, regulations limiting the use of local credit cards and foreign currency could constrain our growth in certain countries. Additionally, in emerging markets, we may face the risk of rapidly changing government policies, including with respect to bank transfers and various payment methods including offline methods, and we may encounter sudden currency devaluations. Currency controls in emerging countries may make it difficult for us to repatriate collections or profits that we generated in a particular country.
+These and other factors associated with our international operations could impair our growth prospects and adversely affect our business, operating results and financial condition.
+Because we recognize net revenue from licensing arrangements with our e-commerce Software & Services customers over the term of the licensing agreement, downturns or upturns in the volume or size or structure of our licensing arrangements are not immediately reflected in full in our operating results in a particular fiscal quarter.
+Certain portions of our revenues are recognized over time. While our current Software & Services licensing arrangement allows us to recognize revenue in the current quarters as certain performance obligations are met, this may not always be the case depending on the revenue recognition patterns of future arrangements. As a result, some or much of the potential future revenue we report each quarter may be the recognition of deferred revenue from contracts entered into during previous quarters. Consequently, a shortfall in demand for our Software & Services offerings or a decline in new or renewed contracts in any one quarter may not significantly reduce our revenues for that quarter but could negatively affect our revenues in future quarters. Accordingly, the effect of significant downturns in new or renewed sales of our Software & Services offerings are not fully reflected in our results of operations until future periods.
+Changes in vendor product costs and availability could materially and adversely affect our Retail business.
+The success of our Retail business, including our B2C and B2B customer bases, depends in part on our ability to anticipate and react to changes with respect to vendor product costs and availability of the goods and services we make available on our mobile applications and web-based e-commerce platforms (collectively, the Boxed Sites ) and otherwise to our customers. We are susceptible to increases in costs of such goods and services as a result of factors beyond our control, such as general economic conditions, market changes, increased competition, general risk of inflation, exchange rate fluctuations, seasonal fluctuations, shortages or interruptions, weather conditions, changes in global climates, global demand, food safety concerns, generalized infectious diseases, changes in law or policy, declines in fertile or arable lands, product recalls, and government regulations.
+For example, food price deflation could reduce the attractiveness of the products we sell relative to competing products and thus reduce our sales growth and overall sales. On the other hand, future food price inflation, particularly periods of rapid inflation such as the industry-wide trends occurring during 2021 and 2022, could reduce our profitability as there may be a lag between the time of the product cost increase and the time at which we are able to increase the price to the customer of the products we sell. Further, we may be unable to pass on the product cost increases to our customers due to competitive dynamics, which could impact our operating profitability. Additionally, unforeseen events, such as the COVID-19 pandemic, can significantly and rapidly increase the demand for certain items, resulting in unanticipated and costly consumer behavior on the Boxed Sites and adverse customer retention when out of stock items increase with respect to highly-desired items. We generally do not have long-term supply contracts or guaranteed purchase 
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+commitments with our vendors, and we do not hedge the risk associated with purchase of commoditized products. As a result, we may not be able to anticipate, react to or mitigate against cost fluctuations which could materially and adversely affect our business.
+The performance of our Retail business and our Software & Services business may be adversely affected by changes in the nature in which businesses are operated following the COVID-19 pandemic and by the timing and long-term approach toward the return to traditional workplaces and work schedules.
+The COVID-19 pandemic, measures attempting to contain and mitigate the effects of the COVID-19 pandemic, including stay-at-home, business closure, vaccine and mask mandates, and other restrictive orders, and the resulting changes in consumer behaviors, have disrupted our normal operations and impacted our employees, vendors, partners, and customers. We expect these disruptions and impacts to continue, particularly as variants of the virus develop and spread. In response to the COVID-19 pandemic, we have taken a number of actions that have impacted and continue to impact our business, including transitioning certain employees (largely employees that work at our corporate headquarters) to remote work-from-home arrangements and imposing travel and related restrictions. While we believe these actions were reasonable and necessary as a result of the COVID-19 pandemic, they were disruptive to our business and could adversely impact our results of operations. Given the continued spread of COVID-19, potential resurgence of infection rates as local and state governments lift their respective business restrictions and safety protocols, and the resultant personal, economic, and governmental reactions, we may have to take additional actions in the future that could harm our business, financial condition, and results of operations. Since our business relies significantly on the efficiency and productivity of our fulfillment and logistics platform, the majority of our employees continued and are continuing their essential work in our fulfillment centers during the COVID-19 pandemic under advanced safety protocols, including encouraging vaccinations and requiring face masks. Prior to the COVID-19 pandemic, certain of our employees traveled frequently to establish and maintain relationships with one another and with our customers, vendors, and investors. We continue to monitor the situation and may adjust our current policies as more information and guidance become available. Suspending travel and in-person business meetings on a long-term basis could negatively impact our marketing efforts, our ability to enter into customer contracts in a timely manner, our international expansion efforts and our ability to recruit employees across the organization. These changes could negatively impact our sales and marketing in particular, which could have longer-term effects on our sales pipeline, or create operational or other challenges, any of which could harm our business. In addition, our management team has spent, and will likely continue to spend, significant time, attention, and resources monitoring the COVID-19 pandemic and associated global economic uncertainty and seeking to manage its effects on our business and workforce.
+The degree to which COVID-19 will affect our Retail business and results of operations will depend on future developments that are highly uncertain and cannot be predicted. These developments include but are not limited to the duration, extent, and severity of the COVID-19 pandemic and variants of the virus, actions taken to contain the COVID-19 pandemic, the impact of the COVID-19 pandemic and related restrictions on economic activity and domestic and international trade, and the extent of the impact of these and other factors on our employees, vendors, partners, and customers. The COVID-19 pandemic and related restrictions have limited and could continue to limit our B2B customers ability to operate effectively (limiting their abilities to obtain inventory, generate sales, or make timely payments to us). It could disrupt or delay the ability of employees to work if they become sick or are required to care for those who become sick, including dependents for whom external care is not available. It has caused and could continue to cause delays or disruptions in services provided by key vendors and product manufacturers, increase our vulnerability and that of our partners and service providers to security breaches, denial of service attacks or other hacking or phishing attacks, or cause other unpredictable effects. Continued delays in return to office throughout 2020 and 2021 have negatively impacted our sales to our B2B customers, and have also limited our ability to acquire new B2B customers. The pandemic s negative impact on our B2B customer base is likely to continue for the foreseeable future as the world continues to adjust to the uncertainty surrounding the COVID-19 pandemic.
+Further, as a result of the COVID-19 pandemic, remote work, particularly for our corporate headquarters employees, and remote access to our systems has increased significantly. Additional controls and processes are therefore necessary to protect company data. Real-time deterrent, preventive, detective, corrective and security monitoring controls could fail to identify certain cyber-attacks or simply not be sufficient or sophisticated enough to detect or thwart these attacks. Although company issued laptops are reinforced with mandatory security software controls to reduce the risk of unknown networked devices and users from accessing company networks, whether third party hosted or not, there remains an elevated risk from remote working due to the reliance on untrusted residential networks for internet work connectivity. Although the company s system activity logs and events have not demonstrated a significant or marked increase in cyber threat activity, there is no assurance this will continue and the company remains vulnerable to cyberattacks which could have a material adverse effect on the company, its operations and its financial results. While we carry cyber 
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+liability insurance, our insurance may not be adequate to cover all liabilities we may incur in connection with cyber liability claims. In addition, we may be unable to continue to maintain our existing insurance, obtain comparable insurance at a reasonable cost, if at all, or secure additional coverage, which may result in future cyber liability claims being uninsured. Any of these factors could negatively impact our business and, consequently, adversely affect our results of operations.
+The COVID-19 pandemic also has caused heightened uncertainty in the global economy. Although certain e-commerce trends positively impacted our B2C offering during the initial onset of the COVID-19 pandemic, there can be no assurances that the overall trend will be sustained through the remainder of the pandemic or in subsequent periods. Additionally, if economic conditions deteriorate, business customers may delay reopening offices and encouraging employees to return to physical offices, they may not have the financial means to make purchases from us and they may delay or reduce discretionary purchases, which would further negatively impact our B2B offering and our results of operations. Our small business customers or individual customers may be more susceptible to general economic conditions than larger businesses, which may have greater liquidity and access to capital. Uncertain and adverse economic conditions also may lead to increased returns, refunds and chargebacks. Since the impact of COVID-19 is ongoing, the effect of the COVID-19 pandemic and the related impact on the global economy may not be fully reflected in our results of operations until future periods. Volatility in the capital markets has been heightened during recent months and such volatility may continue, which may cause declines in the price of our common stock.
+Further, to the extent there is a sustained general economic downturn and our offerings are perceived by customers and potential customers as costly, our revenue may be disproportionately affected by delays or reductions in general spending. Competitors, many of whom are larger and more established than we are, may respond to market conditions by lowering prices and attempting to lure away our customers. In addition, the increased pace of consolidation in certain industries may result in reduced overall spending on our Software & Services offerings and related services. We cannot predict the timing, strength, or duration of any economic slowdown, instability, or recovery, generally or within any particular industry. If the economic conditions of the general economy or markets in which we operate worsen from present levels, our business, results of operations, and financial condition could be materially and adversely affected. Further, to the extent the COVID-19 pandemic adversely affects our business, results of operations or financial condition, it may also have the effect of heightening many of the other risks described in this Risk Factors section.
+If we fail to develop and successfully introduce new Software & Services offerings, or fail to maintain existing products and services that are significant to our retail partners, or if we are unable to anticipate and respond to rapid changes in technology or industry trends, our business, growth expectations, and financial condition may be materially and adversely affected.
+The markets in which we compete are characterized by constant change and innovation, and we expect them to continue to evolve rapidly. Our long-term success will depend be based on our ability to identify and anticipate the needs of users of our Software & Services offerings and develop and maintain products that provide them with the tools they need to operate their businesses. Our future success in attracting new retailers and expanding our Software & Services offerings and the revenue we generate from each Software & Services partnership will depend on our ability to improve the look, functionality, performance, security, design and reliability of our solutions and services and to suit them to the needs of our retail partners.
+We invest significant time and effort in the research and development of new and enhanced product and service offerings to serve our Software & Services users, including the development of vertical solutions for specific business segments, various design elements, such as customized colors, fonts, content, language and other features, and our full-stack no-code/low-code development platform, intended to attract developers to our platform, and back-office administrative tools for our partners and their third-party associates and ultimate customers. We also need to ensure the continued collaboration with certain third-party products and services that are included in our offerings and that may be significant to our retail partners. It may take our design team and developers months to update, code and test new and upgraded solutions and services and integrate them into our platform. Furthermore, the introduction of these new and upgraded design features, solutions and services also may involve a significant amount of marketing spending.
+If we are unable to successfully maintain and enhance our existing products to meet evolving retail partner and end user requirements and increase adoption and usage of our products, services and related third-party products, if we are unable to maintain existing products provided to us by third parties that may be significant to our retail partners, if our efforts to increase the usage of our services are more expensive than we expect, or if our solutions fail to achieve widespread acceptance, potential retail partners may adopt the products and services of our competitors and our revenues and competitive position could be materially and adversely affected.
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+We may be unable to source additional, or strengthen our existing relationships with, vendors. In addition, the loss of any of our key vendors would negatively impact our business.
+In order to attract quality vendors, we must:
+ demonstrate our ability to help our vendors increase their sales;
+ offer vendors a high quality, cost-effective fulfillment process; and
+ continue to provide vendors a dynamic and real-time view of our demand and inventory needs.
+
+If we are unable to provide our vendors with a compelling return on investment and an ability to increase their sales, we may be unable to maintain and/or expand our vendor network, which would negatively impact our business.
+We purchase significant amounts of products from a number of vendors with limited supply capabilities. There can be no assurance that our current vendors will be able to accommodate our anticipated growth or continue to supply current quantities at preferential prices. An inability of our vendors to provide products in a timely or cost-effective manner could impair our growth and materially and adversely affect our business, financial condition, and results of operations. For instance, as a result of the disruptions resulting from the COVID-19 pandemic, some of our existing vendors were not able to supply us with products in a timely or cost-effective manner. While we believe these disruptions to be temporary, but still continuing, their duration is uncertain and a continued inability of our vendors to provide products or other product supply disruptions that may occur in the future could impair our business, financial condition, and results of operations.
+We generally do not maintain long-term supply contracts with any of our product vendors and any of our vendors could discontinue selling to us at any time. The loss of any of our significant vendors or the discontinuance of any preferential pricing or exclusive incentives they currently offer to us would have a negative impact on our business, financial condition, and results of operations.
+We continually seek to expand our base of vendors and to identify new products. If we are unable to identify or enter into distribution relationships with new vendors or to replace the loss of any of our existing vendors, we may experience a competitive disadvantage, our business may be disrupted and our business, financial condition, and results of operations may be adversely affected.
+In addition, certain of the brands we currently purchase and offer for sale to our customers are not offered by our retailer competitors. However, we have not entered into formal exclusivity agreements with the vendors for such brands. In the event these vendors choose to enter into distribution arrangements with other retailers or other competitors, our sales could suffer and our business could be adversely affected.
+Our principal vendors currently provide us with certain incentives such as volume purchasing, trade discounts, cooperative advertising and market development funds. A reduction or discontinuance of these incentives would increase our costs and could reduce our profitability. Similarly, if one or more of our vendors were to offer these incentives or other preferential incentives, including preferential pricing, to our competitors, our competitive strength would be reduced, which could materially and adversely affect our business, financial condition, and results of operations.
+We may be unable to sustain or improve our customer loyalty offerings, which could lead to reduced customer engagement and retention, and adversely affect our business, financial condition and results of operations and rate of growth.
+Our revenue growth is partially dependent on our ability to continue to improve current loyalty and subscription offerings, as well as introduce new offerings to keep our customers engaged. We believe the success of offerings such as our Prince & Spring private-label brand, our Boxed Up paid loyalty program, and our auto-ship subscription program help drive increased customer engagement. If we are unable to maintain and continuously improve these programs, or if we are unable to offer new additional loyalty programs, it may impact our customer retention and adversely affect our business and financial condition.
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+Further, customers enrolling in our loyalty programs, including our auto-ship subscription and Boxed Up programs, are able to cancel their membership at any time and may decide to cancel or forego memberships due to any number of reasons, including increased prices for that membership or for our services, quality issues with our services, harm to our reputation or brand, seasonal usage, or individuals personal economic pressures. Increasing governmental regulation of automatically renewing subscription programs could negatively impact our marketing of this program. A decline in the number of customers engaging in our loyalty programs could materially and adversely affect our business, results of operations and financial condition.
+Food safety, quality, and health concerns could affect our business.
+We could be adversely affected if customers lose confidence in the safety and quality of our vendor supplied and private label brand food products. This is heightened by our expansion into the on-demand grocery delivery business that includes fresh foods (including meat, fish, poultry, dairy, and vegetables) with the acquisition of the MaxDelivery in December 2021. All of our vendors are required to comply with applicable product safety laws and we are dependent upon them to ensure such compliance. One or more of our vendors, including manufacturers of our private label brand products, might not adhere to product safety requirements or our quality control standards. Any issues of product safety or allegations that our products are in violation of governmental regulations, including, but not limited to, issues involving products manufactured in foreign countries, could cause those products to be recalled. Adverse publicity about these types of concerns, whether valid or not, may discourage customers from buying the products we offer. The real or perceived sale of contaminated food products by us could result in product liability claims against our vendors or us, expose us or our vendors to governmental enforcement action or private litigation, or lead to costly recalls and a loss of customer confidence, any of which could have an adverse effect on our business, financial condition, and results of operations.
+We outsource the manufacturing of our private-label brand products. As a result, our private-label brand business may be adversely affected by a variety of factors including, but not limited to, fluctuations in the cost and availability of raw materials, complications relating to the manufacturing process and the failure of our outsourcing partners to maintain an adequate quality-control system. Any issues relating to the manufacturing of such private-label brand products or claims arising from any injury or illness allegedly caused by such products could adversely affect the reputation of our private label brands or our results of operations. Many of these factors are subject to circumstances that are beyond our control, such as the supply and demand of commodities, weather and agricultural conditions, governmental regulations and the ability to hire a sufficient number of qualified personnel. In addition, our products may be exposed to product recalls, including voluntary recalls or withdrawals, if they are alleged to cause or pose a risk of injury or illness or if they are alleged to have been mislabeled, misbranded or adulterated or to otherwise be in violation of governmental regulations. We may also voluntarily recall or withdraw products that we consider to not meet our standards, whether for palatability, appearance or otherwise, in order to protect our brand and reputation. Furthermore, we also may be subject to product liability claims if the consumption or use of our products is alleged to cause injury or illness. While we carry product liability insurance, our insurance may not be adequate to cover all liabilities we may incur in connection with product liability claims. For example, punitive damages are generally not covered by insurance. In addition, we may be unable to continue to maintain our existing insurance, obtain comparable insurance at a reasonable cost, if at all, or secure additional coverage, which may result in future product liability claims being uninsured. Any of these factors could negatively impact our private brand business and, consequently, adversely affect our results of operations.
+If we do not successfully optimize, operate and manage the expansion of the capacity of our fulfillment centers, or if we lose access to one or more of our fulfillment centers, our business, financial condition, and results of operations could be harmed.
+If we do not optimize and operate our fulfillment centers successfully and efficiently, it could result in excess or insufficient fulfillment capacity, an increase in costs or impairment charges or harm our Retail business in other ways. In addition, if we do not have sufficient fulfillment capacity or experience a problem fulfilling orders in a timely manner, our customers may experience delays in receiving their purchases, which could harm our reputation and our relationship with our customers. The COVID-19 pandemic has disrupted and strained our fulfillment center labor pool and many continue to do so. Any unanticipated occurrences with respect to the COVID-19 pandemic, including any potential outbreak of cases or the development of a vaccine-resistant strain during the reopening of the U.S. economy by state and local governments, could cause us to experience disruptions to the operations of our fulfillment centers, including an insufficient and strained labor pool from time to time, which may negatively impact our ability to fulfill orders in a timely manner, which could harm our reputation, relationship with customers and results of operations.
+We have designed and built our own fulfillment center infrastructure, including proprietary robotics and fulfillment software, which is designed to meet the specific needs of our business. If we continue to add fulfillment and warehouse capabilities, add new 
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+businesses or categories with different fulfillment requirements or change the mix in products that we sell, our fulfillment network will become increasingly complex and operating it will become more challenging. Failure to successfully address such challenges in a cost-effective and expedient manner could impair our ability to timely deliver our customers purchases and could harm our reputation and ultimately, our business, financial condition, and results of operations.
+We anticipate the need to add additional fulfillment centers as our business continues to grow. We cannot assure you that we will be able to locate suitable facilities on commercially acceptable terms in accordance with our expansion plans, nor can we assure you that we will be able to recruit qualified managerial and operational personnel to support our expansion plans, especially if the COVID-19 pandemic continues. If we are unable to secure new or expanded facilities for the expansion of our fulfillment operations, recruit qualified personnel to support any such facilities, or effectively control expansion-related expenses, our business, financial condition, and results of operations could be materially and adversely affected. If demand for our product offerings grow faster than we anticipate, we may exceed our fulfillment center capacity sooner than we anticipate, we may experience problems fulfilling orders in a timely manner or our customers may experience delays in receiving their purchases, which could harm our reputation and our relationship with our customers, and we would need to increase our capital expenditures more than anticipated and in a shorter time frame than we currently anticipate. Our ability to expand our fulfillment center capacity, including our ability to secure suitable facilities and recruit qualified employees, may be substantially affected by the spread of COVID-19 and its variant strains and related governmental orders and there may be delays or increased costs associated with such expansion as a result of the spread and impact of the COVID-19 pandemic. Many of the expenses and investments with respect to our fulfillment centers are fixed, and any expansion of such fulfillment centers will require additional capital investment. We expect to incur higher capital expenditures in the future for our fulfillment center operations as our business continues to grow. We would incur such expenses and make such investments in advance of expected sales, and such expected sales may not occur. Any of these factors could materially and adversely affect our business, financial condition, and results of operations.
+Packaging and shipping products are critical parts of our Retail business and any changes in, or disruptions to, our packaging and shipping vendor arrangements could adversely affect our business, financial condition, and results of operations.
+We currently rely on third-party national, regional and local logistics providers to deliver the products we offer on our website and mobile applications. If we are not able to negotiate acceptable pricing and other terms with these providers, or if these providers experience performance problems or other difficulties in processing our orders or delivering our products to customers, it could negatively impact our results of operations and our customers experience. For example, changes to the terms of our shipping arrangements may adversely impact our gross margins and profitability. In addition, our ability to receive inbound inventory efficiently and ship merchandise to customers may be negatively affected by factors beyond our and these providers control, including inclement weather, fire, flood, power loss, earthquakes, pandemics, epidemics or other health-related crises, acts of war or terrorism or other events specifically impacting our or other shipping partners, such as labor disputes, financial difficulties, system failures and other disruptions to the operations of the shipping companies on which we rely. We are also subject to risks of damage or loss during delivery by our shipping vendors. If the products ordered by our customers are not delivered in a timely fashion or are damaged or lost during the delivery process, our customers could become dissatisfied and cease buying products through our website and mobile applications, which would adversely affect our business, financial condition, and results of operations. Further, COVID-19 and its variant strains and related governmental work and travel restrictions may cause disruptions and delays in national, regional and local shipping, which may negatively impact our customers experience and our results or operations. The spread of COVID-19, and any future pandemic, epidemic or similar outbreak, has and may continue to disrupt our vendors and logistics providers, such as UPS, FedEx, Lone Star Overnight, OnTrac, Lasership, GLS and other third-party delivery agents, as their workers may be prohibited or otherwise unable to report to work and transporting products within certain countries, regions, states or localities may be limited due to laws, rules, orders or regulations, extended holidays, factory closures, port closures and increased border controls and closures, among other things. Throughout 2020 and 2021, we have witnessed an unprecedented industry-wide increase in costs associated with shipping resulting from a combination of increased e-commerce demand as well as labor shortages across the shipping carrier landscape. This cost inflation has impacted our Retail business profitability. We may continue to incur higher shipping costs due to rate increases and various surcharges, including increasing fuel surcharges, implemented by third-party delivery agents. Further increases may result from future increases in shipping demand, labor shortages, or the result of any COVID-19 outbreak and any future pandemic, epidemic or similar outbreak, among other factors.
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+Our business depends on network and mobile infrastructure, our third-party data center hosting facilities, other third-party providers, and our ability to maintain and scale our technology. Any significant interruptions or delays in service on our website or mobile applications or any undetected errors or design faults could result in limited capacity, reduced demand, processing delays, and loss of customers or vendors. A failure to adequately resolve such defects and implement new systems could harm our business and adversely affect our results of operations.
+A key element of our strategy is to generate a high volume of traffic on, and use of, our website and mobile applications. Our reputation and ability to acquire, retain, and serve our customers are dependent upon the reliable performance of our website and mobile applications and the underlying network infrastructure. As our customer base and the amount of information shared on our website and mobile applications continue to grow, we will need an increasing amount of network capacity and computing power. We have spent and expect to continue to spend substantial amounts on data center services, including those of third-party cloud providers, and equipment and related network infrastructure to handle the traffic on our website and mobile applications. The operation of these systems is complex and could result in operational failures. In some cases, third-party cloud providers run their own platforms that we access, and we are, therefore, vulnerable to their service interruptions. In the event that the volume of traffic of our customers exceeds the capacity of our current network infrastructure or in the event that our customer base or the amount of traffic on our website and mobile applications grows more quickly than anticipated, we may be required to incur significant additional costs to enhance the underlying network infrastructure. Interruptions or delays in these systems, whether due to system failures, computer viruses, physical or electronic break-ins, undetected errors, design faults or other unexpected events or causes, could affect the security or availability of our website and mobile applications and prevent our customers from accessing our website and mobile applications. If sustained or repeated, these performance issues could reduce the attractiveness of our products and services. In addition, the costs and complexities involved in expanding and upgrading our systems may prevent us from doing so in a timely manner and may prevent us from adequately meeting the demand placed on our systems. Any web or mobile platform interruption or inadequacy that causes performance issues or interruptions in the availability of our website or mobile applications could reduce customer satisfaction and result in a reduction in the number of customers using our products and services.
+We depend on the development and maintenance of the Internet and mobile infrastructure. This includes maintenance of reliable Internet and mobile infrastructure with the necessary speed, data capacity and security, as well as timely development of complementary products, for providing reliable Internet and mobile access. We also use and rely on services from other third parties, such as our telecommunications services and our sole payment processor, and those services may be subject to outages and interruptions that are not within our control. Failures by our telecommunications providers may interrupt our ability to provide phone support to our customers and distributed denial-of-service ( DDoS ) attacks directed at our telecommunication service providers could prevent customers from accessing our website. In addition, we have in the past and may in the future experience down periods where our third-party credit card processor is unable to process the online payments of our customers, which would disrupt our ability to receive customer orders. Our business, financial condition, and results of operations could be materially and adversely affected if for any reason the reliability of our Internet, telecommunications, payment system and mobile infrastructure is compromised.
+We currently rely upon third-party data storage providers. Nearly all of our data storage and analytics are conducted on, and the data and content we create associated with sales on our website and mobile applications are processed through, servers hosted by these providers. We also rely on e-mail service providers, bandwidth providers, Internet service providers and mobile networks to deliver e-mail and push communications to customers and to allow customers to access our website.
+Any damage to, or failure of, our systems or the systems of our third-party data centers, including cloud storage solution providers, or our other third-party providers could result in interruptions to the availability or functionality of our website and mobile applications. As a result, we could lose customer data and miss order fulfillment deadlines, which could result in decreased sales, increased overhead costs, excess inventory and product shortages. If for any reason our arrangements with our data centers, cloud storage solution providers or other third-party providers are terminated or interrupted, such termination or interruption could adversely affect our business, financial condition, and results of operations. We exercise little control over these providers, which increases our vulnerability to problems with the services they provide. We have designed certain of our software and computer systems so as to also utilize data processing, storage capabilities and other services. Given this, along with the fact that we cannot rapidly switch certain operations to other cloud providers, any disruption of or interference with our use of the services of our existing providers would impact our operations and our business would be adversely impacted. We could experience additional expense in arranging for new facilities, technology, services and support. In addition, the failure of our third-party data centers, including cloud storage solution providers, or any other third-party providers to meet our capacity requirements could result in interruption in the availability or functionality of our website and mobile applications.
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+The satisfactory performance, reliability and availability of our website, mobile applications, transaction processing systems and technology infrastructure are critical to our reputation and our ability to acquire and retain customers, as well as to maintain adequate customer service levels. Our net revenue depends on the number of visitors who shop on our website and mobile applications and the volume of orders that we can handle. Unavailability of our website or of our mobile applications or reduced order fulfillment performance would reduce the volume of goods sold and could also materially and adversely affect customer perception of our brand. Any slowdown or failure of our website, mobile applications or the underlying technology infrastructure could harm our business, reputation and our ability to acquire, retain and serve our customers.
+The occurrence of a natural disaster, power loss, telecommunications failure, data loss, computer virus, pandemic, epidemic or other health-related crisis, an act of terrorism, cyberattack, vandalism or sabotage, act of war or any similar event, or a decision to close our third-party data centers on which we normally operate or the facilities of any other third-party provider without adequate notice or other unanticipated problems at these facilities could result in lengthy interruptions in the availability of our website and mobile applications. Cloud computing, in particular, is dependent upon having access to an Internet connection in order to retrieve data. If a natural disaster, pandemic (such as the COVID-19 pandemic), blackout or other unforeseen event were to occur that disrupted the ability to obtain an Internet connection, we may experience a slowdown or delay in our operations. While we have some limited disaster recovery arrangements in place, our preparations may not be adequate to account for disasters or similar events that may occur in the future and may not effectively permit us to continue operating in the event of any problems with respect to our systems or those of our third-party data centers or any other third-party facilities. Our disaster recovery and data redundancy plans may be inadequate, and our business interruption insurance may not be sufficient to compensate us for the losses that could occur. If any such event were to occur to our business, our operations could be impaired and our business, financial condition, and results of operations may be materially and adversely affected.
+We rely significantly on the use of information technology, as well as those of our third party service providers. Our failure or the failure of our third-party service providers to protect our website, networks, and systems against cybersecurity incidents, or otherwise to protect our confidential or personally identifiable information, could damage our reputation and brand and substantially harm our business, financial condition, and results of operations.
+Our services are web-based and we collect, process, transmit, and store large amounts of data about our customers, employees, vendors and others, including credit card information and personally identifiable information, as well as other confidential and proprietary information. We also employ third-party service providers for a variety of reasons, including storing, processing and transmitting proprietary, personal and confidential information on our behalf. While we rely on tokenization solutions licensed from third parties in an effort to securely transmit confidential and sensitive information, including credit card numbers, advances in computer capabilities, new technological discoveries or other developments may result in the whole or partial failure of this technology to protect this data from being breached or compromised. Similarly, our security measures, and those of our third-party service providers, may not detect or prevent all attempts to hack our systems or those of our third-party service providers. DDoS attacks, viruses, malicious software, break-ins, phishing attacks, social engineering, security breaches or other cybersecurity incidents and similar disruptions that may jeopardize the security of information stored in or transmitted by our website, networks and systems or that we or our third-party service providers otherwise maintain, including payment card systems, may subject us to fines or higher transaction fees or limit or terminate our access to certain payment methods. We and our service providers may not anticipate or prevent all types of attacks until after they have already been launched, and techniques used to obtain unauthorized access to or sabotage systems change frequently and may not be known until launched against us or our third-party service providers, and we may be unable to implement adequate preventative measures. We may also experience security breaches that may remain undetected for an extended period. In addition, cybersecurity incidents can also occur as a result of non-technical issues, including intentional or inadvertent breaches by our employees or by persons with whom we have commercial relationships.
+Breaches of our security measures or those of our third-party service providers or any cybersecurity incident could result in unauthorized access to our website, networks and systems; unauthorized access to and misappropriation of customer and/or employee information, including personally identifiable information, or other confidential or proprietary information of ourselves or third parties; viruses, worms, spyware or other malware being served from our website, networks or systems; deletion or modification of content or the display of unauthorized content on our website; interruption, disruption or malfunction of operations; costs relating to cybersecurity incident remediation, deployment of additional personnel and protection technologies, response to governmental investigations and media inquiries and coverage; engagement of third party experts and consultants; litigation, regulatory action and other potential liabilities. If any of these cybersecurity incidents occur, or there is a public perception that we, or our third-party service providers, have suffered such a breach, our reputation and brand could also be damaged and we could be required to expend 
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+significant capital and other resources to alleviate problems caused by such cybersecurity incidents. As a consequence, our business could be materially and adversely affected and we could also be exposed to litigation and regulatory action and possible liability. In addition, any party who is able to illicitly obtain a customer s password could access the customer s transaction data or personal information. Any compromise or breach of our security measures, or those of our third-party service providers, could violate applicable privacy, data security and other laws, and cause significant legal and financial exposure, adverse publicity and a loss of confidence in our security measures, which could have a material adverse effect on our business, financial condition, and results of operations. The potential for increased cost is heightened as governmental authorities throughout the U.S. and around the world devote increasing attention to data privacy and security issues.
+While we maintain privacy, data breach, and network security liability insurance, we cannot be certain that our coverage will be adequate for liabilities actually incurred or that insurance will continue to be available to us on economically reasonable terms, or at all. Additionally, even though we continue to devote resources to monitor and update our systems and implement information security measures to protect our systems, there can be no assurance that any controls and procedures we have in place will be sufficient to protect us from future cybersecurity incidents. Failure by us or our vendors to comply with data security requirements, including the CCPA new reasonable security requirement in light of the private right of action, or rectify a security issue may result in class action litigation, fines, and the imposition of restrictions on our ability to accept payment cards, which could adversely affect our operations. As cyber threats are continually evolving, our controls and procedures may become inadequate and we may be required to devote additional resources to modify or enhance our systems in the future. As a result, we may face interruptions to our systems, reputational damage, claims under privacy and data protection laws and regulations, customer dissatisfaction, legal liability, enforcement actions or additional costs, any and all of which could adversely affect our business, financial condition, and results of operations. In addition, although we seek to detect and investigate data security incidents, security breaches and other incidents of unauthorized access to our information technology systems and data can be difficult to detect and any delay in identifying such breaches or incidents may lead to increased harm and legal exposure of the type described above.
+We are subject to risks related to online transactions and payment methods.
+We accept payments using a variety of methods, including credit card, debit card, Apple Pay, PayPal, Google Pay, gift cards and customer invoicing. We rely on third parties to provide certain of these payment methods and payment processing services. As we offer new payment options to customers, we may be subject to additional regulations, compliance requirements and fraud. For certain payment methods, including credit and debit cards, we pay interchange and other fees, which may increase over time and raise our operating costs and lower profitability. We are also subject to payment card association operating rules and certification requirements, including the Payment Card Industry Data Security Standard and rules governing electronic funds transfers, which could change or be reinterpreted to make it difficult or impossible for us to comply. As our business changes, we may also be subject to different rules under existing standards, which may require new assessments that involve costs above what we currently pay for compliance. If we fail to comply with the rules or requirements of any provider of a payment method we accept, if the volume of fraud in our transactions limits or terminates our rights to use payment methods we currently accept, or if a data breach occurs relating to our payment systems, we may, among other things, be subject to fines or higher transaction fees and may lose, or face restrictions placed upon, our ability to accept credit card and debit card payments from customers or to facilitate other types of online payments. If any of these events were to occur, our business, financial condition and operating results could be materially adversely affected.
+We occasionally receive orders placed with fraudulent credit card data. We may suffer losses as a result of orders placed with fraudulent credit card data even if the associated financial institution approved payment of the orders. Under current credit card practices, we may be liable for fraudulent credit card transactions. We may also suffer losses from other online transaction fraud, including fraudulent returns. If we are unable to detect or control credit card or transaction fraud, our liability for these transactions could harm our business, financial condition and operating results.
+We rely on limited providers for payment processing to provide the technology we utilize to process payments for the Boxed Sites and to offer to our Software & Services customers.
+To process payments through the Boxed Sites and through e-commerce platforms we develop for our Software & Services clients, we have entered into payment service provider agreements with select providers. These agreements are integral to our and some of our Software & Services clients ability to process payments made through our respective platforms and any disruption or problems with our payment service providers or their services could have an adverse effect on our reputation, results of operations and financial results. If our payment service providers were to terminate their respective relationships with us, we could incur substantial delays and 
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+expense in finding and integrating alternative payment service providers, and the quality and reliability of such alternative payment service providers may not be meet our requirements. Any long-term or permanent disruption in our payment processing infrastructure would decrease our revenues from our Software & Services clients, since these would be required to use one of the alternative payment gateways offered through our platform.
+We rely on the performance of members of management and highly skilled personnel, and if we are unable to attract, develop, motivate and retain well-qualified employees, including due to evolving labor dynamics, our business could be harmed.
+Our ability to maintain our competitive position is largely dependent on the services of our senior management and other key personnel. In addition, our future success depends on our continuing ability to attract, develop, motivate, and retain qualified and skilled employees. The market for such positions is highly competitive. Qualified individuals are in high demand and we may incur significant costs to attract and retain them. In addition, the loss of any of our senior management or other key employees or our inability to recruit and develop mid-level managers could materially and adversely affect our ability to execute our business plan, and we may be unable to find adequate replacements. Further, if we expand our fulfillment center capacity or open additional fulfillment centers, we will need to attract and staff a variety of positions, including managerial positions, which will necessitate the time and attention of management. All of our employees are at-will employees, meaning that they may terminate their employment relationship with us at any time, and their knowledge of our business and industry would be extremely difficult to replace. If we fail to retain talented senior management and other key personnel, or if we do not succeed in attracting well-qualified employees or retaining and motivating existing employees, our business, financial condition, and results of operations may be materially and adversely affected.
+Recent and ongoing increases in labor costs have impacted our business, and labor shortages or further increases could continue for the foreseeable future, which may adversely impact our future operations.
+Labor is a significant portion of our cost structure and is subject to many external factors, including unemployment levels, prevailing wage rates, minimum wage laws, potential collective bargaining arrangements, health insurance costs and other insurance costs and changes in employment and labor legislation or other workplace regulation. From time to time, legislative proposals are made to increase the federal minimum wage in the United States, as well as the minimum wage in New York, Nevada, New Jersey and Texas, where we operate fulfillment centers, and New York where our corporate headquarters is located, and a number of other states and municipalities, and to reform entitlement programs, such as health insurance and paid leave programs. Notably, there has been a recent increase the amount of state legislation around minimum wage, with New York, Nevada, and New Jersey all implementing relatively substantial minimum wage increases over the last several years. As minimum wage rates increase or related laws and regulations change, we have and may need to continue to increase not only the wage rates of our minimum wage employees, but also the wages paid to our other hourly or salaried employees. Any increase in the cost of our labor could have an adverse effect on our business, financial condition and results of operations or, if we fail to pay such higher wages, we could suffer increased employee turnover. Increases in labor costs could force us to increase prices, which could adversely impact our sales. If competitive pressures or other factors prevent us from offsetting increased labor costs by increases in prices to our customers, our profitability may decline and could have a material adverse effect on our business.
+We may be unable to adequately protect our brand and our other intellectual property rights. Additionally, we may be subject to intellectual property infringement claims or other allegations, which could result in substantial damages and diversion of management s efforts and attention.
+We regard our brand, customer lists, trademarks, service marks, copyrights, trade dress, domain names, trade secrets, proprietary technology, and similar intellectual property as critical to our success. We rely on trademark, copyright, trade secret protection, agreements, and other methods with our employees and others to protect our proprietary rights. Effective intellectual property protection may not be available in every country in which our products are, or may be made, available. Regulations governing domain names may not protect our trademarks and similar proprietary rights. We may be unable to prevent third parties from acquiring domain names that are similar to, infringe upon, or diminish the value of our trademarks and other proprietary rights. The protection of our intellectual property rights may require the expenditure of significant financial, managerial and operational resources. Moreover, the steps we take to protect our intellectual property may not adequately protect our rights or prevent third parties from infringing or misappropriating our proprietary rights, and we may be unable to broadly enforce all of our intellectual property rights. Any of our intellectual property rights may be challenged by others or invalidated through regulatory administrative process or litigation. Our applications to register our trademarks may never be granted. We also cannot be certain that others will not independently develop or otherwise acquire equivalent or superior technology or intellectual property rights. Furthermore, our confidentiality agreements may 
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+not effectively prevent disclosure of our proprietary information, technologies and processes and may not provide an adequate remedy in the event of unauthorized disclosure or use of such information.
+We might be required to spend significant resources to monitor and protect our intellectual property rights. For example, we may initiate claims or litigation against others for infringement, misappropriation or violation of our intellectual property rights, or other proprietary rights or to establish the validity of such rights. However, we may be unable to discover or determine the extent of any infringement, misappropriation, or other violation of our intellectual property rights and other proprietary rights. Despite our efforts, we may be unable to prevent third parties from infringing upon, misappropriating or otherwise violating our intellectual property rights and other proprietary rights. Any litigation, whether or not it is resolved in our favor, could result in significant expense to us and divert the efforts of our technical and management personnel, which may materially and adversely affect our business, financial condition, and results of operations.
+We rely on licenses to use the intellectual property rights of third parties which are incorporated into our products and services. Failure to renew or expand existing licenses may require us to modify, limit, or discontinue certain features of our offerings, which could affect our business, financial condition and results of operations. In addition, our technology platform may use open source software. The use of such open source software may subject us to certain conditions, including the obligation to offer, distribute, or disclose our technology platform for no or reduced cost, make the proprietary source code subject to open source software licenses available to the public, license our software and systems that use open source software for the purpose of making derivative works, or allow reverse assembly, disassembly, or reverse engineering. We monitor our use of open source software to avoid subjecting our technology platform to conditions we do not intend. However, if our technology platform becomes subject to such unintended conditions, it could have an adverse effect on our business, financial condition, and results of operations.
+Third parties have from time to time claimed, and may claim in the future, that we have infringed their intellectual property rights. These claims, whether meritorious or not, could be time-consuming, result in considerable litigation costs, result in injunctions against us or the payment of damages by us, require significant amounts of management time or result in the diversion of significant operational resources and expensive changes to our business model, result in the payment of substantial damages or injunctions against us, or require us to enter into costly royalty or licensing agreements, if available. In addition, we may be unable to obtain or utilize on terms that are favorable to us, or at all, licenses or other rights with respect to intellectual property we do not own. We have not exhaustively searched patents relative to our technology, and exhaustive searches of copyrights and trade secrets are not feasible due to the nature of such intellectual property rights. These risks have been amplified by the increase in third parties whose sole or primary business is to assert such claims. As a result of a dispute, we may have to develop non-infringing technology, enter into royalty or licensing agreements, adjust our merchandising or marketing activities or take other action to resolve the claims. Any payments we are required to make and any injunctions we are required to comply with as a result of these claims could materially and adversely affect our business, financial condition, and results of operations.
+We have identified material weaknesses in our internal control over financial reporting and we may identify additional material weaknesses in the future or otherwise fail to maintain effective internal control over financial reporting, which may result in material misstatements of our Consolidated Financial Statements or cause us to fail to meet our periodic reporting obligations or cause our access to the capital markets to be impaired.
+In connection with the preparation of our financial statements for the year ended December 31, 2020, we identified material weaknesses in our internal control over financial reporting. We did not design and maintain an effective control environment and control activities commensurate with our financial reporting requirements. Specifically, we did not maintain a sufficient complement of personnel with an appropriate degree of technical knowledge commensurate with our accounting and reporting requirements or effectively select and develop control activities that mitigate risks that involve more complex accounting judgments. These material weaknesses resulted in deficiencies surrounding the controls related to the preparation, review, and analysis of accounting information and financial statements. Those controls are not adequately designed or appropriately implemented to identify material misstatements in financial reporting on a timely basis.
+Each of these material weaknesses could result in a misstatement of one or more account balances or disclosures, misstatements that would result in a material misstatement to the annual or interim Consolidated Financial Statements which would not be prevented or detected.
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+We have begun an implementation plan to remediate these material weaknesses. With the oversight of senior management and our audit committee, we have hired and will continue hiring additional accounting personnel with technical accounting and financial reporting experience and have implemented improved process level and management review controls with respect to the completeness, accuracy, and validity of complex accounting measurements on a timely basis. We also have supplemented internal accounting resources with external advisors to assist with performing technical accounting activities. Furthermore, we are implementing a process of formalizing procedures to ensure appropriate internal communications between the accounting department and other operating departments necessary to support the internal controls. The remediation measures are ongoing, and will not be considered remediated until our remediation plan has been fully implemented, the applicable controls are fully operational for a sufficient period of time, and we have concluded, through testing, that the newly implemented and enhanced controls are operating effectively. These remediation measures are expected to result in future costs for the Company. At this time, we cannot predict the success of such efforts or the outcome of our assessment of the remediation efforts. Our efforts may not remediate these material weaknesses in our internal control over financial reporting, and may not prevent additional material weaknesses from being identified in the future. Our failure to implement and maintain effective internal control over financial reporting could result in errors in our Consolidated Financial Statements that could result in a restatement of our Consolidated Financial Statements, and could cause us to fail to meet our reporting obligations, any of which could diminish investor confidence in us and cause a decline in our equity value. Additionally, ineffective internal controls could expose us to an increased risk of financial reporting fraud and the misappropriation of assets, and may further subject us to potential delisting from the stock exchange on which we list, or to other regulatory investigations and civil or criminal sanctions.
+As a public company, subject to limited exceptions, we are required pursuant to Section 404(a) of the Sarbanes-Oxley Act to furnish a report by management on, among other things, the effectiveness of our internal control over financial reporting for each annual report on Form 10-K to be filed with the SEC. This assessment will need to include disclosure of any material weaknesses identified by our management in internal control over financial reporting. If in the future we are no longer classified under the definition of an emerging growth company, our independent registered public accounting firm will also be required, pursuant to Section 404(b) of the Sarbanes-Oxley Act, to attest to the effectiveness of our internal control over financial reporting in each annual report on Form 10-K to be filed with the SEC, which may lead to a substantial increase in costs incurred. We will be required to disclose material changes made in our internal control over financial reporting on a quarterly basis. Failure to comply with the Sarbanes-Oxley Act could potentially subject us to sanctions or investigations by the SEC, the NYSE on which our securities are listed, or other regulatory authorities, which would require additional financial and management resources.
+Prior to the Business Combination, Seven Oaks identified material weaknesses in its internal control over financial reporting. One or more of these material weaknesses could adversely affect our ability to report our results of operations and financial condition accurately and in a timely manner, which may adversely affect investor confidence in us and materially and adversely affect our business and operating results.
+Prior to consummation of the Business Combination, Seven Oaks management identified two material weaknesses in its internal control over financial reporting, one related to the accounting for a significant and unusual transaction related to the warrants it issued in connection with the IPO in December 2020 and another related to its application of ASC 480-10-S99-3A related to its accounting classification of the initial shares of Seven Oaks Class A common stock outstanding prior to the Business Combination.
+To respond to these material weaknesses, we have devoted and plan to continue to devote, significant effort and resources to the remediation and improvement of our internal control over financial reporting. While we have processes to identify and appropriately apply applicable accounting requirements, we plan to enhance these processes to better evaluate our research and understanding of the nuances of the complex accounting standards that apply to our Consolidated Financial Statements. Our plans at this time include providing enhanced access to accounting literature, research materials and documents, and increased communication among our personnel and third-party professionals with whom we consult regarding complex accounting applications. The elements of our remediation plan can only be accomplished over time, and we can offer no assurance that these initiatives will ultimately have the intended effects.
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+Some provisions of our certificate of incorporation and bylaws and Delaware law may have anti-takeover effects that could discourage an acquisition of us by others, even if an acquisition would be beneficial to our stockholders, and may prevent attempts by our stockholders to replace or remove our current management.
+Provisions in our certificate of incorporation and bylaws, as well as provisions of the DGCL, could make it more difficult for a third party to acquire us or increase the cost of acquiring us, even if doing so would benefit our stockholders, including transactions in which stockholders might otherwise receive a premium for their shares.
+These provisions include:
+ our Board is classified into three classes of directors with staggered three-year terms, and directors are only able to be removed from office for cause;
+ nothing in our certificate of incorporation precludes future issuances without stockholder approval of the authorized but unissued shares of our common stock;
+ advance notice procedures apply for stockholders to nominate candidates for election as directors or to bring matters before an annual meeting of stockholders;
+ our stockholders are only able to take action at a meeting of stockholders and not by written consent;
+ only our chairman of the Board, our Chief Executive Officer, our President or a majority of the Board are authorized to call a special meeting of stockholders;
+ no provision in our certificate of incorporation or the bylaws provides for cumulative voting, which limits the ability of minority stockholders to elect director candidates;
+ certain amendments to our certificate of incorporation will require the approval of two-thirds of the then outstanding voting power of our capital stock;
+ our bylaws provide that the affirmative vote of two-thirds of the voting power of the then-outstanding shares of our voting stock, voting as a single class, is required for stockholders to amend or adopt any provision of the bylaws;
+ our certificate of incorporation authorizes undesignated preferred stock, the terms of which may be established and shares of which may be issued, without the approval of the holders of our common stock; and
+ certain litigation against us can only be brought in Delaware.
+
+Our certificate of incorporation states that we shall not engage in a business combination with an interested stockholder for a period of three years after the date of the transaction in which the person became an interested stockholder, unless:
+ the business combination or transaction which resulted in the stockholder becoming an interested stockholder was approved by the Board prior to the time that the stockholder became an interested stockholder;
+ upon consummation of the transaction which resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding shares owned by directors who are also officers of the corporation and shares owned by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or
+ at or subsequent to the time the stockholder became an interested stockholder, the business combination was approved by the Board and authorized at an annual or special meeting of the stockholders, and not by written consent, by the affirmative vote of at least two-thirds of the outstanding voting stock which is not owned by the interested stockholder.
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+These anti-takeover defenses could discourage, delay or prevent a transaction involving a change in control of us. These provisions could also discourage proxy contests and make it more difficult for our stockholders to elect directors of their choosing and cause us to take corporate actions other than those our stockholders desire.
+Our certificate of incorporation and bylaws designate the Court of Chancery of the State of Delaware as the exclusive forum for certain litigation that may be initiated by our stockholders, which could limit our stockholders ability to obtain a favorable judicial forum for disputes with us.
+Our certificate of incorporation and bylaws provide that, to the fullest extent permitted by law, and unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware and any appellate court thereof will be the sole and exclusive forum for (i) any derivative action, suit or proceeding brought on our behalf, (ii) any action asserting a claim for or based on a breach of a fiduciary duty owed to us or our stockholders by any of our current or former directors, officers, employees, agents or stockholders, (iii) any action asserting a claim against us or any of our current or former directors, officers, employees, agents or stockholders arising under the DGCL, the certificate of incorporation or the bylaws (as either may be amended from time to time) or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware or (iv) any action, suit or proceeding asserting a claim related to or involving us that is governed by the internal affairs doctrine.
+Additionally, Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. Unless we consent in writing to the selection of an alternative forum, our certificate of incorporation and bylaws provide that the federal district courts of the United States will, to the fullest extent permitted by law, be the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act; however, there is uncertainty as to whether a court would enforce such provision, and investors cannot waive compliance with federal securities laws and the rules and regulations thereunder. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. The certificate of incorporation provides that the exclusive forum provision will not apply to suits brought to enforce a duty or liability created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction.
+These provisions may have the effect of discouraging lawsuits against our directors and officers. The enforceability of similar choice of forum provisions in other companies certificates of incorporation has been challenged in legal proceedings, and it is possible that, in connection with any applicable action brought against us, a court could find the choice of forum provisions contained in the certificate of incorporation and bylaws to be inapplicable or unenforceable in such action.
+Risks Related to Our Capital Requirements and Capital Structure
+We have a history of operating losses and may never be able to achieve or maintain profitability.
+We incurred net losses of $36.2 million, $69.2 million, $34.4 million and $65.4 million for the three months ended March 31, 2022 and the years ended December 31, 2021, 2020, and 2019, respectively. As a result of our ongoing losses, as of March 31, 2022, we had an accumulated deficit of $420.9 million. While we have experienced significant revenue growth since inception, we may not be able to sustain or increase our growth or achieve or sustain profitability in the future. We intend to continue to invest in sales and marketing efforts, research and development, growth in personnel, expansion of our fulfillment center network, and expansion of our Software & Services business into new geographies. In addition, we expect to incur significant additional legal, accounting, insurance, and other expenses related to our being a public company as compared to when we were a private company. We will also incur additional costs associated with our proposed commercial partnership with Palantir that are not fully reflected in our historical financial results. We expect to continue to generate losses for the foreseeable future. We cannot assure you that we will achieve profitability in the future or that, if we do become profitable, we will be able to sustain profitability. Additionally, we may encounter unforeseen operating expenses, difficulties, complications, delays, and other unknown factors that may result in losses in future periods. If these losses exceed our projections or our revenue growth expectations are not met in future periods, our financial performance will be harmed.
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+Our need to raise additional capital in the future to execute on our business plan and meet the financial covenants included in our term loan raise substantial doubt about our ability to continue as a going concern.
+To date, we have raised a substantial amount of capital from outside investors and lenders through the issuance of stock and borrowings, including under our term loans and revolving credit facilities, as well as through the consummation of the Business Combination. In addition to the $69.9 million in cash and cash equivalents on our balance sheet, as of March 31, 2022, we also had $58.2 million in receivables related to the Forward Purchase Agreement entered into in connection with the Business Combination. The timing and terms of any recoupment of the receivables (or some portion thereof) are influenced by our stock price performance over the 24 months following the Business Combination, and there is no guarantee that we will recoup the full amount of that receivable.
+As an emerging growth company, we expect to continue to rely on outside capital for the foreseeable future to execute our strategy of investing in growth at the expense of long-term profits and expect to continue to make substantial investments in our business, including in the expansion of the merchandise sold on our platform, in our research and development for our Software & Services segment, and in our advertising and sales teams, in addition to incurring additional costs as a result of being a public company.
+Included in the capital raised to date is our term loan agreement, entered into in August 2021 for principal of $45.0 million. The term loan contains a certain number of financial covenants, which requires us to (i) maintain minimum unrestricted cash balance of $15.0 million, (ii) maintain minimum net Retail revenue based upon agreed quarterly targets; and (iii) maintain a Retail gross margin percentage of at least 8%. In order to achieve these targets, we expect to invest in growth initiatives including substantially increasing our marketing spend, resulting in an increase in cash used in operating activities for the next twelve months. As of March 31, 2022, we were in compliance with the financial covenants required by our term loan. However, these uncertainties, including the inherent uncertainties associated with executing our growth strategy, combined with the financial covenants and growth requirements associated with our $45.0 million term loan, create risk that we may not be able to maintain compliance with one or more of these covenants over the next twelve months.
+Further, as of March 31, 2022, we had no additional capital available for borrowing and no firm commitment from current or prospective investors to provide us additional capital to fund operations in the foreseeable future. These uncertainties, including the inherent uncertainties discussed above regarding our growth strategy and financial covenants, raise substantial doubt about our ability to continue as a going concern.
+Our business plans may change, general economic, financial or political conditions in our markets may change, or other circumstances may arise, that have a material adverse effect on our cash flow and the anticipated cash needs of our business. Any of these events or circumstances could result in significant additional funding needs, requiring us to raise additional capital. We cannot predict the timing or amount of any such capital requirements at this time, and there can be no assurance that we will be able to obtain additional debt or equity financing on terms acceptable to us, if at all, or that we will generate sufficient future revenues. Our management and Board will have broad discretion in determining when, whether, and how we raise additional capital and, unless required by the rules of NYSE, such capital raises will not require stockholder approval. If we raise additional funds through further issuances of equity or convertible debt securities, our existing stockholders could suffer significant dilution, and any new equity securities we issue could have rights, preferences, and privileges superior to those of holders of our common stock. If we are unable to obtain adequate financing or financing on terms satisfactory to us, when we require it, our ability to continue to pursue our business objectives and to respond to business opportunities, challenges, or unforeseen circumstances could be significantly limited, and our business, financial condition and results of operations could be materially adversely affected. We also could be required to seek funds through arrangements with partners or others that may require us to relinquish rights or jointly own some aspects of our technologies, products or services that we would otherwise pursue on our own.
+Financial covenants and restrictions imposed by our debt facilities could adversely affect our operating flexibility and possibly result in a default and acceleration of repayment of the debt.
+Our debt facilities limit our ability to, among other things:
+ incur or guarantee additional debt;
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+ make certain investments and acquisitions;
+ incur certain liens or permit them to exist;
+ enter into certain types of transactions with affiliates;
+ merge or consolidate with another company; and
+ transfer, sell or otherwise dispose of assets.
+
+Our debt facilities also contain covenants requiring us to maintain certain financial metrics, including requirements to maintain a certain level of growth and gross margin within our Retail business, along with a requirement to maintain a minimum unrestricted cash threshold of $15.0 million at all times. The provisions of our debt facilities may affect our ability to obtain future financing and to pursue attractive business opportunities and our flexibility in planning for, and reacting to, changes in business conditions. As a result, restrictions in our debt facilities could adversely affect our business, financial condition, and results of operations. In addition, a failure to comply with the provisions of our debt facilities could result in a default or an event of default that could enable our lenders to declare the outstanding principal of that debt, together with accrued and unpaid interest, to be immediately due and payable. If the payment of outstanding amounts under our debt facilities is accelerated, our assets may be insufficient to repay such amounts in full, and our stockholders could experience a partial or total loss of their investment. Please see Management s Discussion and Analysis of Financial Condition and Results of Operations Liquidity and Capital Resources. 
+Our results of operations and business could be harmed if we fail to manage the growth of our infrastructure effectively or fail to expand our infrastructure into additional geographic locations because we may be unable to execute our business plan, maintain high levels of service and customer satisfaction, or adequately address competitive challenges.
+We have experienced rapid growth in our business and operations and expect to continue to experience significant growth, which places substantial demands on our operational infrastructure. In the future, we may be required to allocate resources and spend substantial amounts to build, purchase, and lease fulfillment centers and equipment, and upgrade our technology and network infrastructure, to handle increased customer traffic and transactions, or to comply with data protection regulations in jurisdictions in which we provide our services. Moreover, as our customer base grows, we will need to devote additional resources to improving our infrastructure and continuing to enhance its scalability to maintain the performance of our platform and solutions. Our need to effectively manage our operations and growth will also require that we continue to assess and improve our operational, financial and management controls, reporting systems, and procedures. Our expansion will continue to place a significant strain on our managerial, administrative, financial, and other resources. We may encounter difficulties obtaining the necessary personnel or expertise to improve those controls, systems and procedures on a timely basis relative to our growth. If we do not manage the growth of our business and operations effectively, the quality of our platform and efficiency of our operations could suffer, which could materially harm our results of operations and business.
+The scalability and flexibility of our online infrastructure depends on the functionality of our third-party servers and their ability to handle increased traffic and demand for bandwidth. We may be unable to achieve or maintain data transmission capacity high enough to handle increased traffic or process transactions in a timely manner. Our failure to achieve or maintain high data transmission capacity could significantly reduce demand for our platform and solutions and could negatively impact our reputation. Further, as we continue to attract users who utilize our online commerce solutions, the volume of transactions processed on our platform will increase, especially if such users draw significant numbers of buyers over short periods of time. The significant growth in the number of registered users and transactions, and new developments and functionalities offered on our platform, has increased the amount of both our stored marketing and research data and the data of our users and their users.
+We will require significant capital expenditures and valuable management resources to grow without undermining our culture of innovation, teamwork, and attention to customer success, which has been central to our growth so far. If we fail to manage our anticipated growth, or change in a manner that fails to preserves our corporate culture, it could negatively affect our reputation and ability to retain and attract customers and employees. It is important that we maintain a high level of customer service and satisfaction as we expand our business. As our Retail and Software & Services businesses continue to grow, we will need to expand our account management, customer service, and other personnel. Failure to manage growth could result in difficulty or delays in enhancing our features and functionality, launching our platform, declines in quality or customer satisfaction, increases in costs, difficulties in 
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+introducing new features, or other operational difficulties. Any of these could adversely impact our business performance and results of operations.
+Our Convertible Notes may impact our financial results, result in the dilution of our stockholders, create downward pressure on the price of our common stock, and restrict our ability to raise additional capital or take advantage of future opportunities.
+We issued an aggregate of $87.5 million of principal amount of Convertible Notes in connection with the Business Combination. The Convertible Notes are convertible for shares of our common stock at a conversion price of $12.00 per share in accordance with the terms thereof and will bear interest at a rate of 7.00% per annum, paid-in-kind or in cash at our option and accruing semi-annually. The sale of the Convertible Notes may affect our earnings per share figures, as accounting procedures may require that we include in our calculation of earnings per share the number of shares of our common stock into which the Convertible Notes are convertible. If shares of our common stock are issued to the holders of the Convertible Notes upon conversion, there will be dilution to our stockholders equity and the market price of our common stock may decrease due to the additional selling pressure in the market. Any downward pressure on the price of our common stock caused by the sale, or potential sale, of shares issuable upon conversion of the Convertible Notes could also encourage short sales by third parties, creating additional selling pressure on our share price.
+We may not have the ability to raise the funds necessary to settle conversions of the Convertible Notes, repurchase the Convertible Notes upon a fundamental change or repay the Convertible Notes in cash at their maturity, and our future debt may contain limitations on our ability to pay cash upon conversion, redemption or repurchase of the Convertible Notes.
+Holders of the Convertible Notes have the right under the indenture governing the Convertible Notes to require us to repurchase all or a portion of their Convertible Notes upon the occurrence of a fundamental change before the applicable maturity date at a repurchase price equal to 101% of the principal amount of such Convertible Notes to be repurchased plus any and all interest from, and including, the date on which interest has been paid or duly provided for under the indenture to, but excluding, the maturity date. Moreover, we will be required to repay the Convertible Notes in cash at their maturity, unless earlier converted, redeemed or repurchased. We may not have enough available cash or be able to obtain financing at the time we are required to make repurchases of such Convertible Notes surrendered or pay cash with respect to such Convertible Notes being converted.
+In addition, our ability to repurchase, redeem or to pay cash upon conversion of Convertible Notes may be limited by law, regulatory authority, or agreements governing our future indebtedness. Our failure to repurchase the Convertible Notes at a time when the repurchase is required by the indenture or to pay cash upon conversion of such Convertible Notes as required by the indenture would constitute a default under such indenture. A default under the indenture or the fundamental change itself could also lead to a default under agreements governing our future indebtedness. If the payment of the related indebtedness were to be accelerated after any applicable notice or grace periods, we may not have sufficient funds to repay the indebtedness and repurchase the Convertible Notes or to pay cash upon conversion of the Convertible Notes.
+Fluctuations in our stock price may yield material changes in the valuation of the underlying derivatives securities associated with our capital structure, including our Convertible Notes and Forward Purchase Transaction.
+We currently have multiple financial instruments, including underlying derivatives which we account for in accordance with ASC 815 Derivatives and Hedging: Embedded Derivatives. In accordance with the guidance, we value these derivatives at each reporting period and recognize the corresponding adjustments to fair value as changes to other income (expense), net in our Statements of Operations. The fair values are estimated using certain pricing models, which involve various inputs, including our current stock price at each reporting period. Period-over-period fluctuations in our stock price may result in material changes in the fair value of these derivatives, which in turn may materially impact (positively and negatively) our Statements of Operations.
+We may still incur substantially more debt or take other actions that would diminish our ability to make payments on the Convertible Notes when due.
+We and our subsidiaries may be able to incur substantial additional debt in the future, subject to the restrictions contained in our debt instruments. Pursuant to the Convertible Note Subscription Agreements, we are subject to certain restrictions under the terms of the indenture governing the Convertible Notes, including limitations regarding incurring future indebtedness, subject to specific allowances in the indenture. However, we will not be restricted from recapitalizing our debt or taking a number of other actions that 
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+are not limited by the terms of the indenture that could have the effect of diminishing our ability to make payments on the Convertible Notes when due.
+It is not possible to predict the actual number of shares, if any, we will sell under the Purchase Agreement to the Holder, or the actual gross proceeds resulting from those sales.
+In May 2022, we entered into a Common Stock Purchase Agreement (the Purchase Agreement ) with the Holder pursuant to which we have the right from time to time at our option to sell to the Holder up to $100.0 million of our Common Stock, subject to certain conditions and limitations set forth in the Purchase Agreement. The shares of our Common Stock that may be issued under the Purchase Agreement may be sold by us to the Holder at our discretion from time to time over an approximately 36-month period commencing on the date of the Purchase Agreement.
+Subject to the terms of the Purchase Agreement, we generally have the right to control the timing and amount of any sales of our shares of Common Stock under the Purchase Agreement. Sales of our Common Stock, if any, under the Purchase Agreement will depend upon market conditions and other factors. We may ultimately decide to sell all, some or none of the shares of our common stock that may be available for us to sell pursuant to the Purchase Agreement.
+Because the purchase price per share to be paid by the Holder for the shares of Common Stock that we may elect to sell to the Holder under the Purchase Agreement, if any, will fluctuate based on the market prices of our common stock during the applicable pricing period for each of those sales, if any, it is not possible for us to predict prior to any such sales the number of shares of Common Stock that we will sell under the Purchase Agreement, the purchase price per share or the aggregate gross proceeds that we will receive from those purchases under the Purchase Agreement, if any.
+Depending on the number of shares of Common Stock we sell under the Purchase Agreement, use of the CCOD Facility could also cause substantial dilution to our stockholders. Further, the resale by the Holder of a significant amount of shares at any given time, or the market perception that these sales may occur, could cause the market price of our Common Stock to decline and to be highly volatile.
+Investors who buy shares at different times will likely pay different prices.
+Pursuant to the Purchase Agreement, we will have discretion, subject to market demand, to vary the timing, prices, and numbers of shares sold to Jones Group. If and when we do elect to sell our Common Stock to Jones Group pursuant to the Purchase Agreement, after Jones Group has acquired such shares, Jones Group may resell all, some or none of such shares at any time or from time to time in its discretion and at different prices. As a result, investors who purchase shares from Jones Group in this offering at different times will likely pay different prices for those shares, and so may experience different levels of dilution and in some cases substantial dilution and different outcomes in their investment results. Investors may experience a decline in the value of the shares they purchase from Jones Group in this offering as a result of future sales made by us to Jones Group at prices lower than the prices such investors paid for their shares in this offering. In addition, if we sell a substantial number of shares to Jones Group under the Purchase Agreement, or if investors expect that we will do so, the actual sales of shares or the mere existence of our arrangement with Jones Group may make it more difficult for us to sell equity or equity-related securities in the future at a time and at a price that we might otherwise wish to effect such sales.
+Our management team may invest or spend the proceeds of this offering in ways with which you may not agree or in ways which may no yield a significant return.
+Our management will have broad discretion over the use of proceeds from sales of our shares of Common Stock made pursuant to the Purchase Agreement, including for any of the purposes described in the section entitled Use of Proceeds, and you will not have the opportunity, as part of your investment decision, to assess whether the proceeds are being used appropriately. However, we have not determined the specific allocation of any net proceeds among these potential uses, and the ultimate use of the net proceeds may vary from the currently intended uses. The net proceeds may be used for corporate purposes that do not increase our operating results or enhance the value of our Common Stock.
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+Risks Related to Laws and Regulations
+We are subject to extensive governmental regulation and we may incur material liabilities under, or costs in order to comply with, existing or future laws and regulation, and our failure to comply may result in enforcements, recalls, and other adverse actions.
+We are subject to a broad range of federal, state, local, and foreign laws and regulations intended to protect public and worker health and safety, natural resources and the environment. Our operations, including our outsourced private-label brand manufacturing partners, are subject to regulation by the Occupational Safety and Health Administration ( OSHA ), the Food and Drug Administration ( FDA ), the United States Department of Agriculture (the USDA ), and by various other federal, state, local and foreign authorities regarding the processing, packaging, storage, distribution, advertising, labeling, and export of our products, including food safety standards and regulations on sale of alcohol. In addition, we and our outsourced private-label brand manufacturing partners are subject to additional regulatory requirements, including environmental, health and safety laws and regulations administered by the U.S. Environmental Protection Agency, state, local and foreign environmental, health and safety legislative and regulatory authorities and the National Labor Relations Board, covering such areas as discharges and emissions to air and water, the use, management, disposal and remediation of, and human exposure to, hazardous materials and wastes, and public and worker health and safety. These laws and regulations also govern our relationships with employees, including minimum wage requirements, overtime, terms and conditions of employment, working conditions and citizenship requirements. Violations of or liability under any of these laws and regulations may result in administrative, civil or criminal fines, penalties or sanctions against us, revocation or modification of applicable permits, licenses or authorizations, environmental, health and safety investigations or remedial activities, voluntary or involuntary product recalls, warning or untitled letters or cease and desist orders against operations that are not in compliance, among other things. Such laws and regulations generally have become more stringent over time and may become more so in the future, and we may incur (directly, or indirectly through our outsourced private-label brand manufacturing partners) material costs to comply with current or future laws and regulations or in any required product recalls. Liabilities under, and/or costs of compliance, and the impacts on us of any non-compliance, with any such laws and regulations could materially and adversely affect our business, financial condition, and results of operations. In addition, changes in the laws and regulations to which we are subject could impose significant limitations and require changes to our business, which may increase our compliance expenses, make our business more costly and less efficient to conduct, and compromise our growth strategy.
+Among other regulatory requirements, the FDA reviews the inclusion of specific claims in food labeling. While we believe that we market our products in compliance with the policies articulated by the FDA, the FDA may disagree or may classify some of our products differently than we do, and may impose more stringent regulations, which could lead to alleged regulatory violations, enforcement actions and product recalls. In addition, we may produce new products in the future that may be subject to FDA pre-market review before we can market and sell such products.
+Furthermore, alcoholic beverages are highly regulated at both the federal and state levels. Regulated areas include production, importation, product labeling, taxes, marketing, pricing, delivery, ownership restrictions, prohibitions on sales to minors, and relationships among alcoholic beverage producers, distributors and retailers. Though we solely undertake marketing activities with respect to alcoholic beverages for appropriate third party retailers selling and/or fulfilling alcoholic beverage purchases made through the Boxed Sites, we cannot assure you that we will always be in full compliance with all applicable regulations or laws, that we will be able to comply with any future regulations and laws, that we will not incur material costs or liabilities in connection with compliance with applicable regulatory and legal requirements, or that such regulations and laws will not materially adversely affect our marketing businesses pertaining to wine, spirits, and/or future alcoholic beverages.
+Licenses issued by local, state and/or federal alcoholic beverage regulatory agencies are required in order to produce, sell, and ship wine and/or spirits (and other alcoholic beverages), but not to market wine and/or spirits (and other alcoholic beverages). For example, as marketers with respect to our wine and spirits marketing businesses, we are not required to acquire or maintain any state or federal licenses at this time. However, we note that licensing may be required of marketers of such products in the future, and compliance failures by licensed entities that produce, sell, and/or ship the wine or spirits that we market can result in fines, license suspension, or license revocation, which could materially affect our wine or spirits marketing businesses. In some cases, compliance failures can also result in cease and desist orders, injunctive proceedings or other criminal or civil penalties, which, in each case, could materially adversely affect our wine marketing business or future alcohol-related marketing businesses.
+Our wine and spirits marketing businesses rely entirely on third parties that have represented and warranted to us that they have requisite licenses to sell wine or spirits into various states, and that their businesses and operations comply with applicable law. 
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+Accordingly, our wine marketing and spirits marketing businesses, and the wine business and spirits business of the partners whose wine and spirits we market, relies substantially on state and federal laws that authorize the shipping of wine and spirits by out-of-state producers, sellers, and/or shippers directly to in-state customers. Those laws are relatively new in many states, and it is common for the laws to be modified. Adverse changes to laws allowing a producer to ship wine or spirits to customers across state lines could materially adversely affect our wine marketing or spirits marketing business, as applicable.
+Developments in applicable regulatory requirements, depending on the outcome, could have a material adverse effect on our reputation, business, financial condition, and results of operations.
+Actual or perceived failures to comply with federal, state and international laws and regulations, our contractual obligations, standards and other requirements relating to privacy, data protection and consumer protection, or the expansion of current or the enactment of new laws or regulations relating to privacy, data protection and consumer protection, could adversely affect our business and our financial condition, including by causing damage to our reputation with customers and retail partners, or resulting in our incurring substantial additional costs or becoming subject to litigation.
+We collect and maintain significant amounts of personal data and other data relating to our customers and employees. A variety of federal, state and international laws and regulations, and certain industry standards, govern or apply to our collection, use, retention, sharing and security of consumer data. We are subject to certain laws, regulations, contractual obligations and industry standards (including, for example, the Payment Card Industry Data Security Standard, or PCI-DSS) relating to privacy, data protection, information security and consumer protection, including California s Consumer Legal Remedies Act and unfair competition and false advertising laws, which are evolving and subject to potentially differing interpretations. These requirements may be interpreted and applied in a manner that is inconsistent from one jurisdiction to another or may conflict with other rules or our practices. As a result, our practices likely have not complied or may not comply in the future with all such laws, regulations, requirements and obligations. As we seek to expand our business, we are, and may increasingly become subject to various laws, regulations and standards, as well as contractual obligations, relating to data privacy and security in the jurisdictions in which we operate. Any failure, or perceived failure, by us to comply with our privacy policies or with any federal, state or international laws, regulations, industry self-regulatory principles, industry standards or codes of conduct, regulatory guidance, orders to which we may be subject or other legal or contractual obligations relating to privacy, data protection, information security or consumer protection could adversely affect our reputation, brand and business, and may result in claims, proceedings or actions against us by governmental entities or others or other liabilities or require us to change our operations and/or cease or modify our use of certain data sets. Any such claim, proceeding or action could hurt our reputation, brand and business, force us to incur significant expenses in defense of such proceedings, distract our management, increase our costs of doing business, result in a loss of customers and vendors or an inability to process credit card payments and may result in the imposition of monetary penalties. We may also be contractually required to indemnify and hold harmless third parties from the costs or consequences of non-compliance with any laws, regulations or other legal obligations relating to privacy or consumer protection or any inadvertent or unauthorized use or disclosure of data that we store or handle as part of operating our business. Additionally, any failure by us to comply with the PCI-DSS may violate payment card association operating rules, applicable laws and regulations, and contractual obligations to which we are subject. Any such failure to comply with the PCI-DSS also may subject us to fines, penalties, damages, and civil liability, or the loss of our ability to accept credit and debit card payments, any of which may materially adversely affect our business, financial condition and operating results.
+We and certain of our service providers receive certain personally identifiable information. In addition, our online operations at www.boxed.com depend upon the secure transmission of confidential information over public networks. A compromise of our security systems or those of some of our business partners that results in customers personal information being obtained by unauthorized persons could adversely affect our reputation with customers and others, as well as our operations, results of operations, financial condition and liquidity, and could result in litigation against us or the imposition of penalties. In addition, a security breach could require that we expend significant additional resources related to the security of information systems and could result in a disruption of our operations.
+Federal, state and international governmental authorities continue to evaluate the privacy implications inherent in the use of third-party cookies and other methods of online tracking for behavioral advertising and other purposes. The United States and foreign governments have enacted, have considered or are considering legislation or regulations that could significantly restrict the ability of companies and individuals to engage in these activities, such as by regulating the level of consumer notice and consent required before a company can employ cookies or other electronic tracking tools or the use of data gathered with such tools. Additionally, some providers of consumer devices and web browsers have implemented, or announced plans to implement, means to make it easier for 
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+Internet users to prevent the placement of cookies or to block other tracking technologies, which could if widely adopted result in the use of third-party cookies and other methods of online tracking becoming significantly less effective. Regulation of the use of these cookies and other online tracking and advertising practices, or a loss in our ability to make effective use of services that employ such technologies, could increase our costs of operations and limit our ability to track trends, optimize our product assortment or acquire new customers on cost-effective terms and consequently, materially adversely affect our business, financial condition and operating results.
+Foreign laws and regulations relating to privacy, data protection, information security, and consumer protection often are more restrictive than those in the United States. There is no harmonized approach to these laws and regulations globally. Consequently, we would increase our risk of non-compliance with applicable foreign data protection laws by expanding internationally. We may need to change and limit the way we use personal information in operating our business and may have difficulty maintaining a single operating model that is compliant. In addition, various federal, state and foreign legislative and regulatory bodies, or self-regulatory organizations, may expand current laws or regulations, enact new laws or regulations or issue revised rules or guidance regarding privacy, data protection, information security and consumer protection. For example, in 2018, California enacted the CCPA, which, among other things, requires new disclosures to California consumers and affords such consumers new abilities to opt out of certain sales of information and may restrict the use of cookies and similar technologies for advertising purposes. The CCPA, which became effective on January 1, 2020, was amended on multiple occasions and is the subject of regulations issued by the California Attorney General regarding certain aspects of the law and its application. Moreover, California voters approved the CPRA in November 2020. The CPRA significantly modifies the CCPA, creating obligations relating to consumer data beginning on January 1, 2022, with implementing regulations expected on or before July 1, 2022, and enforcement beginning July 1, 2023. Aspects of the CCPA and CPRA remain unclear, resulting in further uncertainty and potentially requiring us to modify our data practices and policies and to incur substantial additional costs and expenses in an effort to comply. Similar laws have been proposed, and likely will be proposed, in other states and at the federal level, and if passed, such laws may have potentially conflicting requirements that would make compliance challenging. For example, on March 2, 2021, the Virginia Consumer Data Protection Act ( CDPA ) was signed into law. The CDPA becomes effective January 1, 2023 and contains provisions that, in addition to other mandates, require businesses subject to the legislation to conduct data protection assessments in certain circumstances and that require opt-in consent from Virginia consumers to process certain sensitive personal information.
+In addition, some laws may require us to notify governmental authorities and/or affected individuals of data breaches involving certain personal information or other unauthorized or inadvertent access to or disclosure of such information. We may need to notify governmental authorities and affected individuals with respect to such incidents. For example, laws in all 50 U.S. states may require businesses to provide notice to consumers whose personal information has been disclosed as a result of a data breach. These laws are not consistent, and compliance in the event of a widespread data breach may be difficult and costly. We also may be contractually required to notify consumers or other counterparties of a security breach. Regardless of our contractual protections, any actual or perceived security breach or breach of our contractual obligations could harm our reputation and brand, expose us to potential liability or require us to expend significant resources on data security and in responding to any such actual or perceived breach.
+We make public statements about our use and disclosure of personal information through our privacy policies that are posted on our websites. The publication of our privacy policies and other statements that provide promises and assurances about data privacy and security can subject us to potential government or legal action if they are found to be deceptive, unfair or misrepresentative of our actual practices. For example, the FTC and many state Attorneys General continue to enforce federal and state consumer protection laws against companies for online collection, use, dissemination and security practices that appear to be unfair or deceptive. For example, according to the FTC, failing to take appropriate steps to keep consumers personal information secure can constitute unfair acts or practices in or affecting commerce in violation of Section 5(a) of the Federal Trade Commission Act. The FTC expects a company s data security measures to be reasonable and appropriate in light of the sensitivity and volume of consumer information it holds, the size and complexity of its business, and the cost of available tools to improve security and reduce vulnerabilities. There are a number of legislative proposals in the United States, at both the federal and state level, and more globally, that could impose new obligations in areas such as e-commerce and other related legislation or liability for copyright infringement by third parties. We cannot yet determine the impact that these future laws, regulations and standards may have on our business.
+Our communications with our customers are subject to certain laws and regulations, including the Controlling the Assault of Non-Solicited Pornography and Marketing ( CAN-SPAM ) Act of 2003, the Telephone Consumer Protection Act of 1991 (the TCPA ), and the Telemarketing Sales Rule and analogous state laws, that could expose us to significant damages awards, fines and other penalties that could materially impact our business. For example, the TCPA imposes various consumer consent requirements and other 
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+restrictions in connection with certain telemarketing activity and other communication with consumers by phone, fax or text message. The CAN-SPAM Act and the Telemarketing Sales Rule and analogous state laws also impose various restrictions on marketing conducted use of email, telephone, fax or text message. As laws and regulations, including FTC enforcement, rapidly evolve to govern the use of these communications and marketing platforms, the failure by us, our employees or third parties acting at our direction to abide by applicable laws and regulations could adversely impact our business, financial condition and results of operations or subject us to fines or other penalties.
+In addition to government regulation, privacy advocates and industry groups have proposed, and may propose in the future, self-regulatory standards. These and other industry standards may legally or contractually apply to us, or we may elect to comply with such standards. If we fail to comply with these contractual obligations or standards, we may face substantial liability or fines. We expect that there will continue to be new proposed laws and regulations concerning data privacy and security in the United States and other jurisdictions in which we operate. We cannot yet determine the impact such future laws, regulations and standards may have on our business or operations.
+As a general matter, compliance with laws, regulations, and any applicable rules or guidance from self-regulatory organizations relating to privacy, data protection, information security and consumer protection may result in substantial costs and may necessitate changes to our business practices, which may compromise our growth strategy, adversely affect our ability to acquire customers, and otherwise adversely affect our business, financial condition and operating results.
+Government regulation of the Internet and e-commerce is evolving, and unfavorable changes or failure by us to comply with these regulations could substantially harm our business, financial condition, and results of operations.
+We are subject to general business regulations and laws as well as regulations and laws specifically governing the Internet and e-commerce. Existing and future regulations and laws could impede the growth of the Internet, e-commerce or mobile commerce, which could in turn adversely affect our growth. These regulations and laws may involve taxes, tariffs, privacy and data security, anti-spam, content protection, electronic contracts and communications, consumer protection and Internet neutrality. It is not clear how existing laws governing issues such as property ownership, sales and other taxes and consumer privacy apply to the Internet as the vast majority of these laws were adopted prior to the advent of the Internet and do not contemplate or address the unique issues raised by the Internet or e-commerce. It is possible that general business regulations and laws, or those specifically governing the Internet or e-commerce, may be interpreted and applied in a manner that is inconsistent from one jurisdiction to another and may conflict with other rules or our practices. We cannot be sure that our practices have complied, comply or will comply fully with all such laws and regulations. Any failure, or perceived failure, by us to comply with any of these laws or regulations could result in damage to our reputation, a loss in business and proceedings or actions against us by governmental entities, customers, vendors or others. Any such proceeding or action could hurt our reputation, force us to spend significant amounts in defense of these proceedings, distract our management, increase our costs of doing business, decrease the use of our websites and mobile applications by consumers and vendors and may result in the imposition of monetary liabilities. We may also be contractually liable to indemnify and hold harmless third parties from the costs or consequences of non-compliance with any such laws or regulations. As a result, adverse developments with respect to these laws and regulations could substantially harm our business, financial condition, and results of operations.
+We are subject to anti-corruption, anti-bribery, anti-money laundering, and similar laws. Non-compliance with such laws can subject us to criminal and/or civil liability and harm our business.
+We are subject to the Foreign Corrupt Practices Act (the FCPA ), the U.S. domestic bribery statute contained in 18 U.S.C. 201, the U.S. Travel Act, and other anti-bribery and anti-money laundering laws in the countries in which we conduct activities. Anti-corruption and anti-bribery laws have been enforced aggressively in recent years. These laws are interpreted broadly to prohibit companies and their employees and third-party intermediaries from authorizing, promising, offering, or providing, directly or indirectly, improper payments or anything else of value to recipients in the public or private sector. As we begin our international sales and increase our business and sales to the public sector, we may engage with partners and third-party intermediaries to market our services and to obtain necessary permits, licenses, and other regulatory approvals. In addition, we or our third-party intermediaries may have direct or indirect interactions with officials and employees of government agencies or state-owned or affiliated entities. We can be held liable for corrupt or other illegal activities of these third-party intermediaries, our employees, representatives, contractors, partners, and agents, even if we do not explicitly authorize such activities.
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+While we have policies and procedures to address compliance with such laws, our employees and agents could violate our policies and applicable law, for which we may be ultimately held responsible. As we establish our international sales and business, our risks under these laws will increase.
+Noncompliance with anti-corruption, anti-bribery, or anti-money laundering laws could subject us to whistleblower complaints, investigations, sanctions, settlements, prosecution, other enforcement actions, disgorgement of profits, significant fines, damages, other civil and criminal penalties or injunctions, suspension and/or debarment from contracting with certain persons, the loss of export privileges, reputational harm, adverse media coverage, and other collateral consequences. If any subpoenas or investigations are launched, or governmental or other sanctions are imposed, or if we do not prevail in any possible civil or criminal litigation, our business, results of operations, and financial condition could be materially harmed. Responding to any action will likely result in a materially significant diversion of management s attention and resources and significant defense costs and other professional fees. Enforcement actions and sanctions could further harm our business, results of operations, and financial condition.
+Jurisdictions in which we conduct our business may seek to impose state and local business taxes, sales taxes, digital services taxes and value added taxes on Internet sales, and the tax policies and regulations imposed by other jurisdictions in which we operate may change, all of which may affect our tax rates and increase our tax liabilities.
+On June 21, 2018, the Supreme Court of the United States issued its decision in South Dakota v. Wayfair, Inc., which overturned a prior decision under which online retailers had not been required to collect sales tax unless they had a physical presence in the buyer s state. As a result, a state may now enforce or adopt laws requiring online retailers to collect and remit sales tax even if the online retailer has no physical presence within the taxing state. In response, an increasing number of states have adopted or are considering adopting laws or administrative practices, with or without notice, that impose sales and use or similar value added or consumption taxes on e-commerce activity, as well as taxes on all or a portion of gross revenue or other similar amounts earned by an online retailer from sales to customers in the state. If any state were to assert that we have any liability for sales tax for prior periods and seek to collect such tax in arrears and/or impose penalties for past non-payment of taxes, it could have an adverse effect on us. New legislation or regulations, the application of laws and regulations from jurisdictions, including other countries whose laws do not currently apply to our business, or the application of existing laws and regulations to the Internet and commercial online services could similarly result in significant additional taxes on our business. In addition, due to the global nature of the Internet, if we continue to expand internationally in the future, foreign countries might attempt to impose additional or new regulation on our business or levy additional or new taxes relating to our activities. These taxes or tax collection obligations could have an adverse effect on us. For instance, the enactment and enforcement of laws resulting from the Supreme Court s decision in South Dakota v. Wayfair, Inc. could also impact where we are required to file state income taxes. As a result, our effective income tax rate as well as the cost and growth of our business could be materially and adversely affected, which could in turn have a material adverse effect on our financial condition and results of operations. Furthermore, there is a possibility that we may be subject to significant fines or other payments for any past failures to comply with these requirements.
+We are also subject to federal, state, local and international laws, regulations, and administrative practices that require us to collect information from our customers, vendors, merchants, and other third parties for tax reporting purposes and report such information to various government agencies. The scope of such requirements continues to expand, requiring us to develop and implement new compliance systems. Failure to comply with such laws and regulations could result in significant penalties. We cannot predict the effect of current attempts to impose sales, income or other taxes on e-commerce. New or revised taxes would likely increase the cost of doing business online and decrease the attractiveness of selling products over the Internet. New taxes could also create significant increases in internal costs necessary to capture data and collect and remit taxes. Any of these events could have a material adverse effect on our business, financial condition, and results of operations.
+Risks Related to Our Common Stock
+General economic factors, domestically and internationally, may adversely affect our business, financial condition, and results of operations.
+Higher energy and gasoline costs, inflation, levels of unemployment, healthcare costs, consumer debt levels, foreign-currency exchange rates, unsettled financial markets, weaknesses in housing and real estate markets, reduced consumer confidence, changes related to government fiscal and tax policies, sovereign debt crises, and other economic factors could adversely affect demand for our products and services or require a change in the mix of products we sell. Rapid and significant changes in commodity prices may 
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+affect our net revenue and gross margins. These factors could also increase our merchandise costs and selling, general and administrative expenses, and otherwise adversely affect our operations and financial results. General economic conditions can also be affected by the outbreak or threats of war, acts of terrorism, natural disasters, pandemics, epidemics or other health-related crises, or other significant national or international events, including actual or perceived political instability domestically and abroad.
+We anticipate incurring substantial stock-based compensation expense, which may have an adverse effect on our results of operations.
+We anticipate incurring substantial stock-based compensation expense in future years as a result of our Incentive Award Plan under which we started granting time-based and performance-based restricted stock units and will continue to grant similar awards in 2022 and in future years. We will recognize the stock-based compensation expense over a time-based vesting period or a derived service period for certain of these awards. We cannot be certain whether and how many restricted stock units will satisfy their performance-based vesting conditions and the actual amount of stock-based compensation expense we will incur for these awards. Any such expense could have a material impact on our results of operations for the periods in which such expense is recognized.
+We do not intend to pay dividends for the foreseeable future.
+We currently intend to retain any future earnings to finance the operation and expansion of our business and we do not expect to declare or pay any dividends in the foreseeable future. Moreover, the terms of our term loan credit facility may restrict our ability to pay dividends, and any additional debt we may incur in the future may include similar restrictions. As a result, stockholders must rely on sales of their common stock after price appreciation as the only way to realize any future gains on their investment.
+You will be diluted by the future issuance of our common stock, our preferred stock or securities convertible into our common or preferred stock, in connection with the exercise of our warrants, the conversion of the Convertible Notes, or issuances under our incentive plans, for acquisitions, for capital raises or otherwise.
+Holders of our common stock may be subject to further dilution upon issuance of the shares reserved for issuance upon conversion of the Convertible Notes, upon exercise of our warrants, due to sales of our Common Stock pursuant to the Purchase Agreement, or under the Boxed, Inc. 2021 Incentive Award Plan ( Incentive Award Plan ) and Boxed, Inc. 2021 Employee Stock Purchase Plan ( ESPP ). Additionally, in the future, we expect to obtain financing or to further increase our capital resources by issuing additional shares of our capital stock or offering debt or other equity securities, including senior or subordinated notes, or debt securities convertible into equity or shares of preferred stock. Issuing additional shares of our capital stock or other equity securities or securities convertible into equity may dilute the economic and voting rights of our existing stockholders or reduce the market price of our common stock or both. Debt securities convertible into equity could be subject to adjustments in the conversion ratio pursuant to which certain events may increase the number of equity securities issuable upon conversion. Shares of our preferred stock, if issued, could have a preference with respect to liquidating distributions or a preference with respect to dividend payments that could limit our ability to pay dividends to the holders of our common stock. Our decision to issue securities in the future will depend on market conditions and other factors beyond our control.
+The price of our common stock may be volatile or may decline regardless of our operating performance, resulting in substantial losses for our stockholders.
+The market price of our common stock may fluctuate significantly in response to numerous factors, many of which are beyond our control, including:
+ actual or anticipated fluctuations in our results of operations;
+ the financial projections we may provide to the public, any changes in these projections or our failure to meet these projections;
+ failure of securities analysts to initiate or maintain coverage of our company, changes in financial estimates or ratings by any securities analysts who follow our company or our failure to meet these estimates or the expectations of investors;
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+ announcements by us or our competitors of significant technical innovations, acquisitions, strategic partnerships, joint ventures, results of operations or capital commitments;
+ changes in operating performance and stock market valuations of other retail companies generally, or those in our industry in particular;
+ price and volume fluctuations in the overall stock market, including as a result of trends in the economy as a whole;
+ changes in our Board or management;
+ sales of large blocks of our common stock, including sales by our executive officers and directors;
+ lawsuits threatened or filed against us;
+ changes in laws or regulations applicable to our business;
+ changes in our capital structure, such as future issuances of debt or equity securities;
+ short sales, hedging and other derivative transactions involving our capital stock;
+ general economic conditions in the United States, including due to inflation;
+ other events or factors, including those resulting from war, natural disasters, incidents of terrorism or responses to these events; and
+ the other factors described in the sections of this prospectus titled Risk Factors and
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+SUMMARY OF THE PROSPECTUS This summary highlights selected information from this prospectus and does not contain all of the information that is important to you in making an investment decision. This summary is qualified in its entirety by the more detailed information included in this prospectus. Before making your investment decision with respect to our securities, you should carefully read this entire prospectus, including the information under Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations, Unaudited Pro Forma Condensed Combined Financial Information and the financial statements included elsewhere in this prospectus. The Company Altus is a developer, owner and operator of large-scale roof, ground and carport-based photovoltaic ( PV ) and energy storage systems, as well as electric vehicle ( EV ) charging facilities, serving commercial and industrial, public sector and community solar customers. Altus s mission is to create a clean electrification ecosystem, to drive the clean energy transition of our customers across the United States while simultaneously enabling the adoption of corporate ESG targets. In order to achieve our mission, we develop, own and operate solar generation, energy storage and EV charging facilities. We have the in-house expertise to develop, build and provide operations and management ( O&M ) and customer servicing for our assets. Our proprietary software platform, Gaia, provides data analytics for the operating assets and streamlines the customer experience from the initial outreach through the asset operations. The strength of our platform is enabled by premier sponsorship from Blackstone, which provides an efficient capital source and access to a network of portfolio companies, and CBRE, which provides direct access to their portfolio of owned and managed commercial and industrial ( C&I ) properties. We are a developer, owner and operator of large-scale roof, ground and carport-based PV and energy storage systems, as well as EV charging facilities, serving commercial and industrial, public sector and community solar customers. We own systems across the United States from Hawaii to Vermont. Our portfolio consists of over 350 megawatts ( MW ) of solar PV. We have both front-of-the-meter (direct grid tie) and behind-the-meter projects. We have long-term power purchase agreements ( PPAs ) with over 300 utility or C&I entities and contracts with over 5,000 residential customers through community solar projects. We sell power on an as-generated basis from the systems directly to building occupants under these PPAs, directly to the grid in Feed-In-Tariff ( FIT ) programs and to residential customers via community solar programs. We also participate in numerous renewable energy certificate ( REC ) programs throughout the country. We have experienced significant growth in the last 12 months as a product of organic growth and targeted acquisitions and currently operate in 18 states, providing clean electricity to our customers equal to the consumption of approximately 30,000 homes, displacing 240,000 tons of CO2 emissions per annum. Business Combination and Related Transactions Business Combination Altus Power, Inc., a Delaware corporation, was originally named CBRE Acquisition Holdings, Inc., and was established as a special purpose acquisition company, which completed its initial public offering on December 15, 2020. CBAH was incorporated for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, and, prior to the Business Combination, the Company was a shell company as defined under the Securities Exchange Act of 1934, as amended (the Exchange Act ), because it had no operations and nominal assets consisting almost entirely of cash. On December 9, 2021, CBAH consummated the previously announced business combination pursuant to the terms of the Business Combination Agreement, whereby, among other things, First Merger Sub merged with and Table of Contents into Altus with Altus continuing as the surviving corporation, and immediately thereafter Altus merged with and into Second Merger Sub, with Second Merger Sub continuing as the surviving entity and as a wholly owned subsidiary of Altus (the Second Merger and together with the First Merger and the other transactions contemplated by the Business Combination Agreement, the Merger ). In connection with the Closing, CBAH changed its name to Altus Power, Inc. In accordance with the terms and subject to the conditions set forth in the Business Combination Agreement, (i) immediately prior to the consummation of the First Merger, each outstanding share of Altus preferred stock that was outstanding was redeemed in full for cash, and (ii) each outstanding share of Altus common stock, including shares that were subject to vesting conditions (the Altus Restricted Shares ) that was outstanding as of immediately prior to the First Effective Time (other than treasury stock and any dissenting shares) was cancelled and automatically converted into the right to receive a number of shares of Class A common stock calculated pursuant to the Business Combination Agreement (the Share Consideration ). The Share Consideration issued in respect of Altus Restricted Shares is subject to the same vesting restrictions as in effect immediately prior to the First Effective Time. In accordance with the terms and subject to the conditions set forth in the Business Combination Agreement: (a) at the First Effective Time (and, for the avoidance of doubt, immediately following the consummation of the CBAH Preferred Stock Redemption), by virtue of the First Merger and without any action on the part of any CBAH Stockholder, subject to and in consideration of the terms and conditions set forth herein (including without limitation delivery of the release contemplated by the Business Combination Agreement, each share of Company Common Stock that is issued and outstanding immediately prior to the First Effective Time (other than any Dissenting Shares and Excluded Shares), converted into the right to receive the applicable Per Share Merger Consideration payable to the holder thereof; (b) at the First Effective Time, by virtue of the First Merger and without any action on the part of any holder thereof, each share of common stock, par value $0.01 per share, of First Merger Sub issued and outstanding immediately prior to the First Effective Time is no longer outstanding and has been converted into and become one (1) validly issued fully paid and non-assessable share of common stock, par value $0.001 per share, of the First Merger Surviving Corporation and all such shares constitute the only outstanding shares of capital stock of the First Merger Surviving Corporation as of immediately following the First Effective Time, and from and after the First Effective Time; (c) at the First Effective Time, by virtue of the First Merger and without any action on the part of any holder thereof, each share of CBAH Capital Stock held in the treasury of the Company immediately prior to the First Effective Time (the Excluded Shares ) were cancelled and no payment or distribution made with respect thereto; (d) at the Second Effective Time, by virtue of the Second Merger and without any action on the part of any holder thereof: (i) each share of common stock of the First Merger Surviving Corporation issued and outstanding immediately prior to the Second Effective Time was cancelled and ceased to exist without any conversion thereof or payment therefor; and (ii) the limited liability company interests of Second Merger Sub outstanding immediately prior to the Second Effective Time converted into and become the limited liability company interests of the Second Merger Surviving Entity. From and after the Second Effective Time, the limited liability company interests of the Second Merger Sub were deemed for all purposes to represent the number of membership interests into which they were converted in accordance with the immediately preceding sentence; and Table of Contents (e) each warrant to purchase shares of CBAH s capital stock (each an CBAH warrant ) that was issued and outstanding immediately prior to the Effective Time and not terminated pursuant to its terms was converted into a warrant to acquire shares of Class A common stock with the same terms and conditions as applied to the CBAH warrant immediately prior to the Effective Time (an Altus warrant ). We continued the listing of common stock and Public Warrants on the NYSE under the symbols AMPS and AMPS WS , respectively. Prior to the Closing, CBAH s SAILSM (Stakeholder Aligned Initial Listing) securities, shares of Class A common stock and CBAH s Redeemable Warrants were listed on the NYSE under the symbols CBAH.U , CBAH and CBAH WS , respectively. The rights of holders of our common stock and warrants are governed by our third amended and restated certificate of incorporation, our second amended and restated bylaws and the Delaware General Corporation Law (the DGCL ), and in the case of the warrants, the Warrant Agreement, dated December 10, 2020 by and between CBAH and Continental Stock Transfer & Trust Company, as warrant agent. See the sections entitled Description of Securities and Selling Securityholders . PIPE On July 12, 2021, CBAH entered into subscription agreements ( PIPE Subscription Agreements ) by and between CBAH and the investors named therein (the PIPE Investors ), pursuant to which the PIPE Investors agreed to purchase, and CBAH agreed to sell to the PIPE Investors, an aggregate of 42,500,000 shares of Class A common stock (inclusive of 15,000,000 shares of Class A common stock purchased by CBRE Acquisition Sponsor, LLC (the Sponsor ) in connection with the full exercise of the Sponsor s commitment under its PIPE Subscription Agreement to purchase additional shares in connection with redemptions by public holders of shares of the Class A common stock) at a purchase price of $10.00 per share for gross proceeds to CBAH of $425,000,000 in a private placement (the PIPE Investment ). The PIPE Investment was consummated substantially concurrently with the Business Combination on December 9, 2021. Emerging Growth Company We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such an election to opt out is irrevocable. Altus intends to rely on the other exemptions and reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an emerging growth company, Altus intends to rely on such exemptions, Altus is not required to, among other things: (a) provide an auditor s attestation report on Altus system of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; (b) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act; (c) comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements (auditor discussion and analysis); and (d) disclose certain executive compensation-related items such as the correlation between executive compensation and performance and comparisons of the Chief Executive Officer s compensation to median employee compensation. Table of Contents Altus will remain an emerging growth company under the JOBS Act until the earliest of (a) the last day of Altus first fiscal year following the fifth anniversary of the Closing, (b) the last date of Altus fiscal year in which Altus has total annual gross revenue of at least $1.07 billion, (c) the date on which Altus is deemed to be a large accelerated filer under the rules of the SEC with at least $700 million of outstanding securities held by non-affiliates or (d) the date on which Altus has issued more than $1.0 billion in non-convertible debt securities during the previous three years. Summary of Risk Factors Our business is subject to numerous risks and uncertainties, including those highlighted in the section titled Risk Factors , which represent challenges that we face in connection with the successful implementation of our strategy and growth of our business. The occurrence of one or more of the events or circumstances described in that section, alone or in combination with other events or circumstances, may have a material adverse effect on our business, cash flows, financial condition and results of operations. These risk factors include, but are not limited to, the following: Our growth strategy depends on the widespread adoption of solar power technology; If we cannot compete successfully against other solar and energy companies, we may not be successful in developing our operations and our business may suffer; With respect to providing electricity on a price-competitive basis, solar systems face competition from traditional regulated electric utilities, from less-regulated third party energy service providers and from new renewable energy companies; A material reduction in the retail price of traditional utility-generated electricity or electricity from other sources could harm our business, financial condition, results of operations and prospects; Due to the limited number of suppliers in our industry, the acquisition of any of these suppliers by a competitor or any shortage, delay, quality issue, price change, or other limitations in our ability to obtain components or technologies we use could result in adverse effects; Although our business has benefited from the declining cost of solar panels in the past, our financial results may be harmed now that the cost of solar panels has increased, and our costs overall may continue to increase due to increases in the cost of solar panels and tariffs on imported solar panels imposed by the U.S. government; Our market is characterized by rapid technological change, which requires us to continue to develop new products and product innovations. Any delays in such development could adversely affect market adoption of our products and our financial results; Developments in alternative technologies may materially adversely affect demand for our offerings; The operation and maintenance of our facilities are subject to many operational risks, the consequences of which could have a material adverse effect on our business, financial condition, results of operations and prospects; Our business, financial condition, results of operations and prospects could suffer if we do not proceed with projects under development or are unable to complete the construction of, or capital improvements to, facilities on schedule or within budget; We face risks related to project siting, financing, construction, permitting, governmental approvals and the negotiation of project development agreements that may impede our development and operating activities; and The unaudited pro forma financial information included herein may not be indicative of what our actual financial position or results of operations would have been. Table of Contents Corporate Information Our principal executive offices are located at 2200 Atlantic Street, 6th Floor, Stamford, CT 06902. Our telephone number is (203) 698-0090, and our website address is https:// www.altuspower.com. Information contained on our website or connected thereto is provided for textual reference only and does not constitute part of, and is not incorporated by reference into, this prospectus or the registration statement of which it forms a part. Table of Contents
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+SUMMARY OF THE PROSPECTUS 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Except as otherwise stated, all share and per share information in this prospectus has been adjusted to give effect to a stock dividend of 0.149387 shares for each outstanding share of Class B common stock, or a total of 1,121,000 shares, in November 2021, resulting in our sponsor and our directors owning 8,625,000 founder shares, of which up to 1,125,000 shares owned by the sponsor are subject to forfeiture depending on the extent to which the underwriters exercise their over-allotment option. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: anchor investors are to the up to 14 qualified institutional buyers or institutional accredited investors which are not affiliated with us, our sponsor, our directors or any member of our management and that have each expressed to us an interest in purchasing units in this offering (with up to nine of these anchor investors each having expressed to us an interest in purchasing up to 2,970,000 units in this offering, one of these anchor investors having expressed to us an interest in purchasing up to 2,700,000 units in this offering, up to two of these anchor investors each having expressed to us an interest in purchasing up to 1,470,000 units in this offering and up to two of these anchor investors each having expressed to us an interest in purchasing up to 1,000,000 units in this offering), and have each agreed to purchase from our sponsor founder shares (187,500 founder shares to each anchor investor that has expressed an interest in purchasing up to 2,970,000 units, 170,455 founder shares to each anchor investor that has expressed an interest in purchasing up to 2,700,000 units, 92,803 founder shares to each anchor investor that has expressed an interest in purchasing up to 1,470,000 units and 63,131 founder shares to each anchor investor that has expressed an interest in purchasing up to 1,000,000 units) at a purchase price of approximately $0.002 per share, subject to each anchor investor purchasing 100% of the units allocated to it, as further described herein; common stock are to our Class A common stock and our Class B common stock, collectively; founder shares are to shares of our Class B common stock initially purchased by our sponsor in a private placement prior to this offering, and the shares of our Class A common stock issuable upon the conversion thereof as provided herein; initial stockholders are to our sponsor and any other holders of our founder shares prior to this offering (or their permitted transferees); management or our management team are to our officers and directors; Grandview Capital Partners are to an affiliate of certain of our officers and directors; private placement are to the private placement of 999,700 units being purchased by our sponsor and Cantor which will occur simultaneously with the completion of this offering at a purchase price of $10.00 per unit for a total purchase price of $ 9,997,000 (or 1,022,200 units being purchased by our sponsor and Cantor at $10.00 per unit for a total purchase price of $10,222,000 if the underwriters over-allotment option is exercised in full); placement units are to the units being purchased separately by our sponsor in the private placement, each placement unit consisting of one placement share and one-half of one placement warrant and to any units issued upon conversion of working capital loans; placement shares are to the shares of our common stock included within the placement units being purchased separately by our sponsor in the private placement and to the shares included in any units issued upon conversion of working capital loans; placement warrants are to the warrants included within the placement units being purchased separately by our sponsor in the private placement and to the warrants included in any units issued upon conversion of working capital loans; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); TABLE OF CONTENTS The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED MAY 26, 2022 $300,000,000 Grandview Capital Acquisition Corp. 30,000,000 Units Grandview Capital Acquisition Corp. is a newly organized blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. While we may pursue an initial business combination target in any business or industry, we intend to focus our search on companies in the food industry. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one share of our Class A common stock and one-half of one redeemable warrant. Only whole warrants are exercisable. Each whole warrant entitles the holder thereof to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as described herein. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. The underwriters have a 45-day option from the date of this prospectus to purchase up to an additional 4,500,000 units to cover over-allotments, if any. We will provide our public stockholders with the opportunity to redeem all or a portion of their shares of our Class A common stock upon the completion of our initial business combination, subject to the limitations described herein. If we are unable to complete our initial business combination within 15 months from the closing of this offering, we will redeem 100% of the public shares for cash, subject to applicable law and certain conditions as further described herein. Our sponsor, Grandview Capital Acquisition LLC, and Cantor Fitzgerald & Co., representative of the underwriters, which we refer to as Cantor, have agreed to purchase an aggregate of 999,700 placement units (or 1,022,200 placement units if the underwriters over-allotment option is exercised in full) at a price of $10.00 per unit, for an aggregate purchase price of $9,997,000 (or $10,222,000 if the underwriters over-allotment option is exercised in full). Our sponsor has agreed to purchase an aggregate of 699,700 placement units for an aggregate purchase price of $6,997,000 (or 722,200 placement units for an aggregate purchase price of $7,222,200 if the underwriters overallotment option is exercised in full) and Cantor has agreed to purchase an aggregate of 300,000 placement units for an aggregate purchase price of $3,000,000. Each placement unit will be identical to the units sold in this offering, except as described in this prospectus. The placement units will be sold in a private placement that will close simultaneously with the closing of this offering. Our initial stockholders, which include our sponsor, own an aggregate of 8,625,000 shares of our Class B common stock (up to 1,125,000 shares of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised), which will automatically convert into shares of Class A common stock at the time of our initial business combination, as described herein. Up to 14 qualified institutional buyers or institutional accredited investors which are not affiliated with us, our sponsor, our directors or any member of our management, and which we refer to as the anchor investors throughout this prospectus, have each expressed to us an interest in purchasing units in this offering (with up to nine of these anchor investors each having expressed to us an interest in purchasing up to 2,970,000 units in this offering, one of these anchor investors having expressed to us an interest in purchasing up to 2,700,000 units in this offering, up to two of these anchor investors each having expressed to us an interest in purchasing up to 1,470,000 units in this offering, and up to two of these anchor investors each having expressed to us an interest in purchasing up to 1,000,000 units in this offering) at the offering price of $10.00, and such allocations will be determined by the underwriters. There can be no assurance that the anchor investors will acquire any units in this offering, or as to the amount of such units the anchor investors will retain, if any, prior to or upon the consummation of our initial business combination. There is also no guarantee that all 14 anchor investors will participate in the offering. Subject to each anchor investor purchasing 100% of the units allocated to it, in connection with the closing of this offering our sponsor will sell up to an aggregate of 2,169,823 founder shares, 187,500 founder shares to each anchor investor that has expressed an interest in purchasing up to 2,970,000 units, 170,455 founder shares to the anchor investor that has expressed an interest in purchasing up to 2,700,000 units, 92,803 founder shares to each anchor investor that has expressed an interest in purchasing up to 1,470,000 units and 63,131 founder shares to each anchor investor that has expressed an interest in purchasing up to 1,000,000 units) to the anchor investors at a purchase price of approximately $0.002 per share. For a discussion of certain additional arrangements with the anchor investors, see Summary The Offering Expressions of Interest. Currently, there is no public market for our units, Class A common stock or warrants. Our units have been approved for listing on The Nasdaq Global Market under the symbol GDVWU on or promptly after the date of this prospectus. We expect the Class A common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Cantor informs us of its decision to allow earlier separate trading, subject to our satisfaction of certain conditions. Once the securities comprising the units begin separate trading, we expect that the Class A common stock and warrants will be listed on Nasdaq under the symbols GDVW and GDVWW, respectively. We are an emerging growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 32 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 300,000,000 Underwriting discounts and commissions(1) $ 0.70 $ 21,000,000 Proceeds, before expenses, to Grandview Capital Acquisition Corp. $ 9.30 $ 279,000,000 (1) Includes $0.50 per unit, or $15,000,000 in the aggregate, payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein. If the underwriters over-allotment option is exercised, 7.0% of the gross proceeds from the over-allotment ($0.70 per unit or up to $3,150,000 in the aggregate) will be deposited in the trust account as deferred underwriting commissions. The deferred commissions will be released to Cantor only on completion of an initial business combination, as described in this prospectus. Does not include certain fees and expenses payable to the underwriters in connection with this offering. See the section of this prospectus entitled Underwriting beginning on page 155 for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the placement units described in this prospectus, $301,500,000 or $346,725,000 if the underwriters over-allotment option is exercised in full ($10.05 per unit in either case) will be deposited into a trust account in the United States at J.P. Morgan Chase Bank, N.A., with Continental Stock Transfer & Trust Company acting as trustee. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2022. Book-Running Manager Cantor , 2022 TABLE OF CONTENTS public stockholders are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder s and member of our management team s status as a public stockholder shall only exist with respect to such public shares; public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market, including warrants that may be acquired by our sponsor or its affiliates in this offering or thereafter in the open market) and to any placement warrants that are sold to third parties that are not initial purchasers or executive officers or directors (or permitted transferees) following the consummation of our initial business combination; sponsor are to Grandview Capital Acquisition LLC, a Delaware limited liability company which is an affiliate of certain of our officers and directors; warrants are to our redeemable warrants, which includes the public warrants as well as the placement warrants; and we, us, company or our company are to Grandview Capital Acquisition Corp. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Unless otherwise stated in this prospectus, or the context otherwise requires, the information presented herein assumes that none of the anchor investors purchased 100% of the units that may be allocated to them and, accordingly, that no founder shares were sold to any anchor investor. For a detailed discussion of the arrangements with the anchor investors, please see Principal Stockholders Expressions of Interest. Our Company We are a newly organized, blank check company formed as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. While we may pursue an acquisition opportunity in any industry or sector, we intend to focus on the food industry which complements our management team s expertise. The food industry is comprised of five major sectors including food input companies, food manufacturers, food distributors, food retailers, and food service companies. We believe that the in-depth experience and capabilities of our management team across these sectors in the food industry will make us an attractive partner to potential target food businesses, enhance our ability to complete a successful business combination, and bring value to the business post-business combination. Management Team Our management team is led by Rajiv Singh, our Executive Chairman, and Torrey Rossetter, our Chief Executive Officer, whose careers have centered around building relationships with companies in the food industry, analyzing and valuing food businesses, and sourcing and executing food transactions and investments. They have more than 50 years of combined experience in the food industry, developing an extensive network of relationships with privately held food companies, in-depth industry knowledge in all five major sectors of the food industry, and execution experience encompassing numerous investments, transactions, and financings. Our management team is well positioned to source proprietary investments by proactively taking advantage of their network of food company relationships, to analyze the risks and potential upside in food investments by leveraging their in-depth industry sector knowledge, and to execute on transactions by utilizing their extensive deal making experience in the food industry. Mr. Singh has over 25 years of investing, corporate finance and food industry experience. Since 2018, he has served as a Managing Partner at Grandview Capital Partners, an investment firm focused exclusively on the food industry. From 2009 to 2018, Mr. Singh held leadership positions at Co peratieve Rabobank TABLE OF CONTENTS U.A. ( Rabobank ), a leading global financial institution focused on the food and agribusiness sector with operations in 38 countries. Mr. Singh was the CEO for Rabobank North America Wholesale Banking, where he established deep relationships with leaders, owners and management at companies in the food and agribusiness sectors, and led the execution of numerous investments, financing, capital markets, and corporate transformation transactions. As CEO, he was responsible for corporate banking, private equity and venture capital, mergers and acquisitions, specialized products, food and agribusiness research, capital markets activities, as well as operational and support functions. Mr. Singh has chaired and was a member of Rabobank s principal risk committees focused on equity, credit, capital markets activities, compliance, and reputation. Prior to Rabobank, Mr. Singh held various positions in investment banking and special situations investing at Deutsche Bank and Credit Suisse, and in corporate strategy and project operations at United Technologies and Nestle. Mr. Singh serves as the co-Chairperson for FoodShot Global, a collaborative investment platform designed to address key problems in the food sector, including health, sustainability and equitability. He is also a member of Board of Advisors at Columbia University s Mailman School of Public Health. Mr. Rossetter has over 25 years of investment, mergers and acquisitions, and finance experience in the food industry. Since 2008, he has served as a Managing Partner at Grandview Capital Partners. He has deep industry knowledge with experience in many segments of the food industry and during his career has led numerous investments and corporate finance transactions encompassing each major sector of the food industry from food input companies to food manufacturers, food distributors, food retailers and food service companies. From 2006 to 2008, Mr. Rossetter served as Managing Director and head of Food & Beverage Investment Banking at RBC Capital Markets, LLC, a financial institution with 70 offices in 15 countries. From 2002 to 2006, Mr. Rossetter was a Managing Director at Strategic Food Capital Partners, an investment firm focused exclusively on food companies. From 1998 to 2002 he was a Managing Director at Rabobank, where he was a founder of Rabobank s Mergers and Acquisitions/ Financial Sponsors Group. Mr. Rossetter began his food industry career at Donaldson, Lufkin & Jenrette in the Corporate Finance Department where he focused on mergers and acquisitions in the food industry. In addition, our management team s network includes more than 50 former and current executives from the food industry who we believe will assist us in sourcing, evaluating, and improving food businesses post-business combination. We believe these food executives, who we call participants, represent a valuable asset and a significant competitive advantage. Given their industry insights, operating expertise and management experience, they may provide advantages in not only in sourcing and evaluating food investments (including due diligence of a target s business, strategy and management team), but in formulating operational and strategic initiatives post-business combination to enhance value. Notwithstanding the foregoing, these participants are not obligated to provide us with any services or introductions and will do so only if they are able to. The past performance of our management team or their affiliates is not a guarantee either (i) that we will be able to identify a suitable candidate for our initial business combination or (ii) of success with respect to any business combination we may consummate. You should not rely on the historical record of our management team s or their affiliates performance as indicative of our future performance. Food Industry Attractiveness The food industry is one of the largest and most fundamentally important industries in the world. The industry represents a significant portion of the global economy and includes an abundance of privately held companies in which to invest. There are thousands of food companies in the U.S., most of which are private family-owned businesses. We intend to focus on five sectors of the food industry, including (i) food inputs, which comprise companies that produce products used in the food industry such as food ingredients, food equipment, crop nutrients, food packaging, agribusinesses and other food and beverage related businesses, (ii) food manufacturing, (iii) food distribution, (iv) food retailing and (v) food service. Food companies across all five major industry sectors have become increasingly interconnected, focusing on supply chain management and developing more tightly linked interdependent relationships with their suppliers and customers to meet the increased need for greater food output and the demands of a more discerning customer. TABLE OF CONTENTS We believe our in-depth experience in the food industry across all five major sectors provides us with key advantages in evaluating both the downside risk and the potential upside in an investment opportunity within a particular sector in the food industry. Stable industry with solid long-term growth prospects and the opportunity for high rates of return. The food industry is generally considered one of the most stable areas of the economy, characterized by solid long-term demand and growth prospects. It includes an abundance of well-established businesses, many of which are recession resistant with solid recurring free cash flows throughout different economic cycles. Many food companies have significant untapped opportunities to improve revenue and profitability that can provide for high risk-adjusted returns. Food companies can create significant value by adding new products/ services, expanding geographically, increasing distribution, and adding new customers. Further, many of these family-owned companies, while solidly profitable, are under-managed from a best practices perspective in various areas of their business, often providing significant opportunities to improve profitability. One of the largest areas of M&A activity with an abundance of acquisition opportunities. The food industry has a high level of M&A activity that provides numerous acquisition opportunities, which M&A activity is expected to continue for the foreseeable future. The exceptionally large number of investment opportunities include an abundance of i) family-owned companies which sell due to generational issues, ii) non-core divestitures from larger corporations as they adjust and redefine their business strategy, and iii) food portfolio companies held by private equity firms which need to be exited to return capital to their investors. Given our extensive network of senior level relationships in each of these large attractive areas, most importantly with family-owned businesses, we believe we will be able to proactively source significant deal flow from this dynamic market on a proprietary basis. Significant buy and build opportunity with numerous add-on opportunities. We believe the food industry represents one of the largest buy and build opportunities today. The food industry is highly fragmented. Many segments of the food industry lack a clear national and/or dominant market share leader. Given the fragmented nature of the food industry we will likely consider, on a highly selective basis, add-on acquisitions of complementary synergistic businesses where we believe such business will have a positive impact on post-business combination financial performance. Our team has extensive relationships with high quality privately held companies which we believe could serve as anchor or platform investments. Business Strategy Our business strategy is to identify, acquire, and build a company in the food industry that complements the experience of our management team. After our initial business combination, we envision our strategy may include additional mergers and acquisitions with a focus on generating attractive adjusted returns for our shareholders. We intend to leverage our management team s well-established network of relationships in the food industry to identify attractive investment candidates where we believe a combination of our relationships, knowledge and industry experience could effect a positive transformation or augmentation of existing businesses to improve their overall value. We plan to utilize the extensive network of relationships and industry expertise of Mr. Singh and Mr. Rossetter in seeking an initial business combination and employing our acquisition strategy. Over the course of their careers, the members of our management team have developed deep relationships with hundreds of family-owned privately held businesses. We also have well established relationships with many of the large food corporations that regularly divest non-core businesses each year, which we believe will also serve as a source of acquisition candidates. We expect these networks will provide our management team with a robust flow of acquisition opportunities. In addition, we have close relationships with many private equity professionals responsible for their firms food portfolio companies within both generalist and consumer sector focused private equity firms. We also have well established relationships with many investment banking professionals responsible for covering food companies within the bulge bracket investment banks, middle market firms and investment banking boutiques. Upon completion of this offering, members of our management team will communicate with their network of relationships to articulate the parameters of our search for a target company and a potential business combination and begin the process of pursuing and reviewing potentially interesting investment candidates. TABLE OF CONTENTS Acquisition Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to execute our initial business combination with a target business that does not meet these criteria and guidelines. We intend to seek to invest in companies that generally have the following characteristics: High quality business with sustainable competitive advantages; Strong, recurring free cash flow capability; Multiple levers of value creation and exceptional upside (on a standalone basis); Ability to serve as a platform for potential add-on acquisitions; Fair value on an as is basis (but attractively valued on an optimized basis); and Strong management. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management team may deem relevant. We may need to obtain additional financing either to complete our initial business combination or because we become obligated to redeem a significant number of our public shares upon completion of our initial business combination. We intend to acquire a company with an enterprise value significantly above the net proceeds of this offering and the sale of the placement units. Depending on the size of the transaction or the number of public shares we become obligated to redeem, we may potentially utilize several additional financing sources, including but not limited to the issuance of additional securities to the sellers of a target business, debt issued by banks or other lenders or the owners of the target, a private placement to raise additional funds, or a combination of the foregoing. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the trust account. Initial Business Combination Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination either (i) in such a way so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses, or (ii) in such a way so that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders, or for other reasons. However, we will only complete an initial business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the TABLE OF CONTENTS post-transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of Nasdaq s 80% fair market value test. If the initial business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. If our securities are not listed on Nasdaq after this offering, we would not be required to satisfy the 80% requirement. However, we intend to satisfy the 80% requirement even if our securities are not listed on Nasdaq at the time of our initial business combination. Our Business Combination Process In evaluating prospective business combinations, we expect to conduct a thorough due diligence review process that will encompass, among other things, a review of historical and projected financial and operating data, meetings with management and their advisors (if applicable), meetings with key employees, on-site inspection of facilities and assets, discussion with customers and suppliers, legal reviews and other reviews as we deem appropriate. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions that our initial business combination is fair to our company from a financial point of view. Each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors were to be included by a target business as a condition to any agreement with respect to our initial business combination. Certain of our officers and directors presently have fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such entity. We believe, however, that the fiduciary duties or contractual obligations of our officers or directors will not materially affect our ability to complete our initial business combination. Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation. Our officers and directors may become an officer or director of another special purpose acquisition company with a class of securities intended to be registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act, even before we have entered into a definitive agreement regarding our initial business combination. Corporate Information Our executive offices are located at 250 Park Avenue, 7th floor, New York, NY 10177, and our telephone number is (212) 551-3530. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012, or the TABLE OF CONTENTS JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A common stock that is held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our shares held by non-affiliates exceeds $250 million as of the prior June 30, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our shares held by non-affiliates exceeds $700 million as of the prior June 30. TABLE OF CONTENTS
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+PROSPECTUS SUMMARY 1 RISK FACTORS 9 SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS 36 USE OF PROCEEDS 37 DIVIDEND POLICY 37 MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS 40 DESCRIPTION OF CAPITAL STOCK 49 PLAN OF DISTRIBUTION 39 EXPERTS 51 INDEX TO FINANCIAL STATEMENTS F-1 Neither we nor any of the Registered Stockholders have authorized anyone to provide any information different from, or in addition to, the information contained in this prospectus and in any free writing prospectuses we have prepared. Neither we nor any of the Registered Stockholders take responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. The Registered Stockholders are offering to sell, and seeking offers to buy, shares of their Class A common stock only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date, regardless of the time of delivery of this prospectus or of any sale of our Class A common stock. Our business, financial condition, results of operations and prospects may have changed since such date. For investors outside the United States: Neither we nor any of the Registered Stockholders have done anything that would permit the use of or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of the shares of our Class A common stock by the Registered Stockholders and the distribution of this prospectus outside the United States. CALCULATION OF REGISTRATION FEE Title of Each Class of Securities to be Registered Amount of Shares to be Registered1 Proposed Maximum Offering Price per Share Proposed Maximum Aggregate Offering Amount of Registration Fee2 Class A Common Stock 404,600,000 $ 0.01 $ 4,046,000 $ 992.81 The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. 1 This Registration Statement covers the resale by the Registered Stockholders of up to 404,600,000 shares of Class A common stock previously issued to such Registered Stockholders. 2 Previously paid. Explanatory Note This Third Amendment to Registrants Form S-1 is filed in response to a Comment Letter issued by the U.S. Securities and Exchange Commission on April 23, 2021. The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS PRO MUSIC RIGHTS, INC. 404,600,000 SHARES OF CLASS A COMMON STOCK This prospectus relates to the resale of up to 404,600,000 shares of our Class A common stock, par value $0.0001 per share by our stockholders identified in this prospectus ("Registered Stockholders"). Unlike an initial public offering ("IPO"), the resale by the Registered Stockholders is not being underwritten by any investment bank. The Registered Stockholders may, or may not, elect to sell their shares of Class A common stock covered by this prospectus, as and to the extent they may determine. There are no underwriting commissions involved in this offering. We have agreed to pay all the costs and expenses of this offering. Registered Stockholder will pay no offering expenses. This offering is highly speculative and these securities involve a high degree of risk and should be considered only by persons who can afford the loss of their entire investment. The Company has minimal revenues to date and there can be no assurance that the Company will be successful in furthering its operations and/or revenues. Persons should not invest unless they can afford to lose their entire investment. Investing in our securities involves a high degree of risk. You should purchase these securities only if you can afford a complete loss of your investment. Prior to this offering, there has been no public market for our Class A common stock, and we have not applied for the listing or quotation of our common stock on any public market. We have arbitrarily determined the offering price of $0.01 per share in relation to this offering. The offering price bears no relationship to our assets, book value, earnings or any other customary investment criteria. After the effective date of the registration statement, we intend to seek a market maker to file an application with the Financial Industry Regulatory Authority ("FINRA") to have our Class A common stock quoted on the Over the Counter Bulletin Board in the United States. Alternatively, we intend to seek listing on NASDAQ, and have applied for reservation for the symbol, "MUSIC" thereon. We also intend to explore a listing on Euronext Amsterdam or Euronext Paris. We currently have no market maker who is willing to list quotations for our stock. There is no assurance that an active trading market for our shares will develop or will be sustained if developed. If the Registered Stockholders choose to sell their shares of Class A common stock, we will not receive any proceeds from the sale of shares of common stock by the Registered Stockholders. We have two classes of common stock, Class A common stock and Class B common stock. The rights of holders of Class A common stock and Class B common stock are identical, except voting, transfer and conversion rights. Each share of Class A common stock is entitled to one (1) vote. Each share of Class B common stock is entitled to one hundred (100) votes. All shares of Class B common stock are held by our founder, Jake Noch (the "Founder"). So long as our Founder holds all shares of Class B Common stock, the Founder will have the ability to control up to 99.980357% of the total voting power of our capital stock. This means that, for the foreseeable future, the control of our company will be concentrated with the Founder through our Class B common stock, notwithstanding the number of outstanding shares of Class A common stock and Class B common stock. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. We are an "emerging growth company" as that term is defined in the Jumpstart Our Business Startups Act of 2012, and, as such, we have elected to comply with certain reduced public company reporting requirements for this prospectus and may elect to do so in future filings. See the section titled "Risk Factors" beginning on page 9 to read about factors you should consider before buying shares of our Class A common stock. Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. The date of this prospectus is April ____, 2022. PRO MUSIC RIGHTS, INC. Letter from the Chief Executive Officer I started Pro Music Rights, Inc. to coalesce the songwriters, composers and publishers into a new performance rights organization. I sought to create the best solution for them to make a competitive wage for their hard work in creating the musical works that we listen to everyday. I am trying to fix the uneven landscape in which the streaming music services build billion dollar businesses on the backs of the songwriters, composers and publishers making today s and tomorrow s musical hits. I am expecting to change the conversation in the musical industry so that it is not just the artists voices being heard and listened to, but the songwriters, composers and publishers whose hard work isn t being recognized as much as it should be. I am trying to fight for the struggling writer who finds inspiration from the shifting wind and the blue skies to write lyrics that touch our lives. I am trying to fight for the composer who hears birds chirping and waves crashing to compose musical progressions for when we dance with loved ones. I strive to provide with the other performance rights organizations are missing: a voice for the unspoken performers in the musical industry. Jake P. Noch Chief Executive Officer Pro Music Rights, Inc. PART II INFORMATION NOT REQUIRED IN PROSPECTUS Item 13. Other Expenses of Issuance and Distribution The following table sets forth the costs and expenses paid or payable by us in connection with the issuance and distribution of the securities being registered. All amounts shown are estimates, except for the SEC registration fee. Amount Paid or to be Paid SEC registration fee $ 992.81 Legal fees expenses 200,000 Accounting fees and expenses 30,180 EGDAR Agents Filing Fees 1,648.50 Transfer agent and registrar fees expenses 19,500 Total $ 252,321.31 Item 14. Indemnification of Directors and Officers Under our Bylaws, the Registrant will indemnify its directors and executive officers (for the purposes of indemnification, "executive officers" has the meaning defined in Rule 3b-7 promulgated under the Exchange Act of 1934, as amended) to the fullest extent not prohibited by the Delaware General Corporation Law or any other applicable law; provided, however, that the Registrant may modify the extent of such indemnification by individual contracts with its directors and executive officers and, provided, further, that the Registrant will not be required to indemnify any director or executive officer in connection with any proceeding (or part thereof) initiated by such person unless (i) such indemnification is expressly required to be made by law, (ii) the proceeding was authorized by the Board of Directors of the Registrant, (iii) such indemnification is provided by the Registrant, in its sole discretion, pursuant to the powers vested in the corporation under the Delaware General Corporation Law or any other applicable law or (iv) such indemnification is required to be made pursuant to an order of any court of competent jurisdiction. Such right of indemnification shall be a contract right, which may be enforced in any manner desired by such person. The expenses of executive officers and directors incurred in defending a civil or criminal action, suit, or proceeding must be paid by the Registrant as they are incurred and in advance of the final disposition of the action, suit, or proceeding, upon receipt of an undertaking by or on behalf of the director or executive officer to repay the amount if it is ultimately determined by a court of competent jurisdiction that he is not entitled to be indemnified by Registrant. Such right of indemnification shall not be exclusive of any other right which such directors, officers, or representatives may have or hereafter acquire, and, without limiting the generality of such statement, they shall be entitled to their respective rights of indemnification under any bylaw, agreement, vote of shareholders, provision of law, or otherwise. Without limiting the application of the foregoing, our board of directors may adopt bylaws from time to time with respect to indemnification, to provide at all times the fullest indemnification permitted by the laws of the State of Delaware, and may cause the Registrant to purchase and maintain insurance on behalf of any person who is or was a director or executive officer of the Registrant, or is or was serving at the request of the Registrant as a director or executive officer of another corporation, or as its representative in a partnership, joint venture, trust, or other enterprise against any liability asserted against such person and incurred in any such capacity or arising out of such status, whether or not the Registrant would have the power to indemnify such person. The indemnification provided shall continue as to a person who has ceased to be a director, officer, employee, or agent, and shall inure to the benefit of the heirs, executors and administrators of such person. II-1 Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling the Registrant pursuant to the foregoing provisions, the Registrant has been informed that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. We have entered into, and intends to continue to enter into, agreements with directors that require us to indemnify these persons against expenses, judgments, fines, settlements and other amounts actually and reasonably incurred (including expenses of a derivative action) in connection with any proceeding, whether actual or threatened, to which any such person may be made a party by reason of the fact that the person is or was a director or officer of the Registrant or any of our affiliated enterprises. We do not an insurance policy covering our officers and directors with respect to certain liabilities, including liabilities arising under the Securities Act, or otherwise. Our certificate of incorporation contains provisions that limit the liability of our directors for monetary damages to the fullest extent permitted by Delaware law. Consequently, our directors will not be personally liable to us or our stockholders for monetary damages for any breach of fiduciary duties as directors, except liability for: any breach of the director s duty of loyalty to us or our stockholders; any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law; unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the Delaware General Corporation Law; or any transaction from which the director derived an improper personal benefit. Item 15. Recent Sales Of Unregistered Securities On November 9, 2020, PMR sold an aggregate of 10,000,000 shares of Class A Common Stock to Mssrs. Roppo, Ring, Bailey, Chillemi and Di Federico in exchange for services to the Company and for which nominal cash proceeds were received by PMR under certain Stock Purchase Agreements dated November 9, 2020. The sale of the securities was made pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended. ITEM 16. EXHIBITS Exhibit Number Description of Exhibit 3.1 Certificate of Incorporation* 3.2 Bylaws* 5.1 Amended Legal Opinion and Consent of Gora LLC** 5.2 Consent of CF Audits LLC** 10.1 Form of Songwriter, Composer, Publisher License Agreements* 10.2 Form of Business License Agreements* 10.3 Form of Indemnification Agreement* 10.4 Form of Stock Purchase Agreement* 10.5 Executed versions of the material licensing agreements** *Previously Filed **Filed Herewith II-2 ITEM 17. UNDERTAKINGS (a) The undersigned registrant hereby undertakes as follows: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (4) That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use. (5) That, for the purpose of determining any liability under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: (i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; (ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; (iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or our securities provided by or on behalf of the undersigned registrant; and (iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. (b) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the undersigned pursuant to the foregoing provisions, or otherwise, the undersigned has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the undersigned of expenses incurred or paid by a director, officer or controlling person of the undersigned in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the undersigned will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. II-3 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements of filing on Form S-1 and authorized this registration statement to be signed on its behalf by the undersigned, in Naples, Florida, on April 12, 2022. PRO MUSIC RIGHTS, INC. By: /s/ Jake Noch Name: Jake Noch Title: Chief Executive Officer By: /s/ Jake Noch Name: Jake Noch Title: Chief Financial Officer In accordance with the requirements of the Securities Act of 1933, this registration statement was signed by the following persons in the capacities and on the dates stated. Signature Title Date /s/ Jake Noch Chief Executive Officer and Director April 12, 2022 (Principal Executive Officer) /s/ Jake Noch Chief Financial Officer April 12, 2022 (Principal Accounting Officer and Principal Financial Officer) /s/ Vito Roppo Director April 12, 2022 /s/ Paul Ring Director April 12, 2022 /s/ James R. Chillemi Director April 12, 2022 /s/ Rodrigo Di Federico Director April 12, 2022 II-4 PRO MUSIC RIGHTS, INC. ABOUT THIS PROSPECTUS This prospectus is a part of a registration statement on Form S-1 that we filed with the SEC using a "shelf" registration or continuous offering process. Under this process, the Registered Stockholders may, from time to time, sell the Class A common stock covered by this prospectus in the manner described herein. Additionally, we may provide a prospectus supplement to add information to, or update or change information contained in, this prospectus. You may obtain this information without charge by following the instructions under the section titled "Where You Can Find Additional Information" appearing elsewhere in this prospectus. You should read this prospectus and any prospectus supplement before deciding to invest in our Class A common stock. PROSPECTUS SUMMARY This summary highlights selected information that is presented in greater detail elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our Class A common stock. You should read this entire prospectus carefully, including the sections titled "Risk Factors" and "Management s Discussion and Analysis of Financial Condition and Results of Operations" and our financial statements and the accompanying notes included elsewhere in this prospectus before making an investment decision. Unless the context otherwise requires, the terms "PMR," "the company," "we," "us" and "our" in this prospectus refer to Pro Music Rights, Inc. PRO MUSIC RIGHTS, INC. Overview & History Our legal name is "Pro Music Rights, Inc." We were formed as "Pro Music Rights, LLC," a Florida limited liability company effective as of January 31, 2018, and we converted into a Delaware corporation on November 4, 2020 resulting in, among things, a change of our legal name from "Pro Music Rights, LLC" to "Pro Music Rights Inc." Our Business Model PMR is a for-profit public performance rights organization representing approximate 2,212,814 musical works of songwriters, composers and publishers, many of which originate from our Founder, and that collects license fees on behalf of the songwriters, composers and publishers with whom it is affiliated and then distributes the license fees as royalties to those songwriters, composers and publishers whose musical works have been publicly performed. Our repertory is presently accessible by download at https://promusicrights.com. 1 PMR is the one of several public performance rights organization in the United States, including Broadcast Music, Inc, American Society of Composers, Authors, and Publishers, SESAC and Global Music Rights, LLC, with an estimated 7.4% share of the performance rights market based solely on the approximate 2,212,814 musical works in its repertory as compared to the publicly available information of the repertoires of Broadcast Music, Inc, American Society of Composers, Authors, and Publishers, SESAC and Global Music Rights, LLC. PMR has a number of reputable artists in its repertory including, OG Maco, best known for his 2014 debut single "U Guessed It," which went viral and peaked at number 90 on the U.S. Billboard Hot 100. PMR has entered into agreements purportedly granting it the right to license the public performance rights in an approximate 2,212,814 copyrighted musical works, which include, for example, musical works featuring notable artists such as A$AP Rocky, Wiz Khalifa, Pharrell, Young Jeezy, Juelz Santana, Lil Yachty, MoneyBaggYo, Larry June, Trae Pound, Sause Walka, Trae Tha Truth, Sosamann, Soulja Boy, Lex Luger, Lud Foe, SlowBucks, Gunplay, OG Maco, Rich The Kid, Fat Trel, Young Scooter, Nipsey Hussle, Famous Dex, Boosie Badazz, Shy Glizzy, 2 Chainz, Migos, Gucci Mane, Rich The Kid, Young Dolph, Trinidad James and Fall Out Boy. PMR currently generates revenue by licensing the musical works in its repertory. How PMR Helps Songwriters, Composers and Publishers As a nascent performance rights organization, PMR s competitive advantage to its competitors is by providing its songwriters, composers and publishers 100% of the royalties attributable to the public performance of the musical works of its songwriters, composers and publishers. So, for example, if one of its songwriters, composers or publishers owns one hundred percent (100%) of the writer s share and publisher s share of a musical work, and PMR receives $1,000 of public performance royalty payments for such musical work, then PMR would pay the entire $1,000 royalty payment to such writer, composer or publisher. In contrast, PMR s competitors would pay the same writer, composer or publisher, less than such $1,000. Additionally, instead of paying such royalty to its writer, composer or publisher on a lengthy periodic basis, such as quarterly just as some of PMR s competitors do, PMR seeks to negotiate shorter payment timelines so that its songwriters, composers and publishers receive royalty payments on a more frequent basis. Separately, even though PMR provides its songwriters, composers and publishers 100% of the royalties attributable to the public performance of their musical works, PMR s business model entails revenue generation by license monthly or annual license fees, including on a per-location basis, to its customers for the public performance of musical works in its repertory. PMR retains such fees, and distributes 100% of the usage fees (i.e., royalties) from customers that public perform the musical works through license with PMR, such as, for example, television and radio stations; broadcast and cable networks; new media, including the Internet/streaming services and mobile technologies; satellite audio services like XM and Sirius; nightclubs, hotels, bars, restaurants and other venues; digital jukeboxes; and live concerts. With such business model, PMR strives to pay songwriters, composers and publishers the entirety of the royalties attributable to their musical works all the while generating revenue to build business operations. All in all, PMR seeks to provide songwriters, composers and publishers with an alternative solution to the existing competition of Broadcast Music, Inc, American Society of Composers, Authors, and Publishers, SESAC and Global Music Rights, LLC. PMR s Agreements with its Songwriters, Composers and Publishers PMR requires its songwriters, composers and publishers to enter into written agreements granting PMR the right and license to publicly performance their respective copyrighted musical works. Under the approximate two-thousand and five hundred and eight (2,508) agreements with PMR, such songwriter, composer and/or publisher has PMR the right to license non-dramatic public performances of their respective musical works, along with the rights and remedies to enforce the copyrights to such musical works. The period of those agreements is for an initial two-year period with successive two-year additional periods unless terminated prior to the then-applicable term with not more than six (6) months or less than three (3) months written notice. PMR is obligated to distribute one hundred percent (100%) of all per-use royalties collected (not including blanket licenses) less any third-party processing fees. Although PMR s songwriters, composers and publishers grant PMR the right and license to publicly performance their respective copyrighted musical works, such musical works may be subject to prior agreements with other performance rights organizations, such as Broadcast Music, Inc, American Society of Composers, Authors, and Publishers, SESAC and Global Music Rights, LLC. Because such other agreements may not have been terminated, or may not have been properly terminated, such other performance rights organization may continue to claim rights with respect to the musical works that are now subject to written agreement with PMR. Additionally, such other agreements may have granted such other performance rights organizations with the continuing right to administer licenses and collect royalties with respect to the musical works that are not subject to written agreement with PMR. 2 Our Culture As the newest performance rights organization in the market, we are trying to disrupt outdated business practices and provide a new solution to the songwriters, composers and publishers. We have taken positions that some market participants may consider to be aggressive, but we are trying to show the industry that we take our responsibilities to our songwriters, composers and publishers seriously. Our Solution We rely significantly on songwriters, composers and publishers to enter into agreements with us, so that we have musical works to license on their behalf. Our revenue model is heavily dependent on securing musical works to license on behalf of songwriters, composers and publishers, and then licensing those musical works to our downstream customers, such as digital streaming services and radio stations. We rely on payment processors to process payments from our downstream customers, and we collect credit card payments from our customers through PayPal, and we also utilize traditional payment collection methods through Raymond James for checks, wires and ACH. From time to time, we may explore other options to collect payments from our customers. Benefits of Our Solution and Competitive Strengths We do not believe in a one-size-fits-all model, and work with our songwriters, composers and publishers to offer a solution best fitting the collective model. We expect to pay out royalties to our songwriters, composers and publishers in a more expeditious manner than other performing rights organizations. We also intend to pay the entirety of the royalty arising from our downstream customers usages of the musical works of songwriters, composers and publishers, unlike other performance rights organizations. We generate revenue through licensing the musical works on a per location basis, as applicable, and we retain the revenue generated therefrom. Our Market Opportunity and Our Growth Strategies As an early-stage performing rights organization, we are working to grow our market share and provide an alternative solution than the existing business model of the other performance rights organizations. We will rely heavily on organic marketing through digital channels. We also have available an automated, transparent music licensing dashboard and reporting system, which we expect will facilitate additional licensing and transactional revenue. As part of the rollout of such dashboard and system, we have lowered the monthly music licensing fee to just $50 USD per month per location/service which is in addition to the fees payable for using the musical works in our repertory. 3 RISKS RELATED TO OUR BUSINESS AND INVESTMENT IN OUR CLASS A COMMON STOCK Investing in our Class A common stock involves a high degree of risk. You should carefully consider the risks highlighted in the section titled "Risk Factors" immediately following this prospectus summary before making an investment decision. We may be unable for many reasons, including those that are beyond our control, to implement our business strategy successfully. Some of these risks are: We have experienced rapid growth of our songwriters, composers and publishers in recent periods, and our recent growth rates may not be indicative of our future growth. We have a limited operating history at our current scale, which makes it difficult to evaluate our future prospects and may increase the risk that we will not be successful. We have a history of losses, and we may not be able to achieve profitability or, if achieved, sustain profitability. Our quarterly results may fluctuate significantly and may not meet our expectations or those of investors or securities analysts. The COVID-19 pandemic has affected how we and our customers operate and has adversely affected the global economy, and the duration and extent to which this will affect our business, future results of operations, and financial condition remains uncertain. If we are unable to attract new clients and expand our repertory to achieve market acceptance, our business would be harmed. We operate in a highly competitive industry, and competition presents an ongoing threat to the success of our business. Failure to effectively develop and expand our direct sales capabilities would harm our ability to expand our business and achieve broader market acceptance. The loss of our founder, Chief Executive Officer, President, Chief Financial Officer and Secretary, Jake Noch, would harm our business. Our failure to protect our sites, networks, and systems against security breaches, or otherwise to protect our confidential information or the confidential information of our users, customers, or other third parties, would damage our reputation and brand, and substantially harm our business and results of operations. If we fail to manage our technical operations infrastructure, or experience service outages, interruptions, or delays in the deployment of our services, our results of operations may be harm. Any trading price of our Class A common stock may be volatile and could, upon any listing or quotation, decline significantly and rapidly. Any trading price of our Class A common stock, upon any listing or quotation, may have little or no relationship to the historical sales prices of our capital stock in private transactions, and such private transactions have been limited. 4 An active, liquid, and orderly market for our Class A common stock may not develop or be sustained. You may be unable to sell your shares of Class A common stock at or above the price at which you purchased them. The dual class structure of our common stock has the effect of concentrating voting control with those stockholders who held our capital stock prior to the listing or quotation of our Class A common stock, including our founder, who held in the aggregate 99.980357% of the voting power of our capital stock as of the date of this Prospectus. This ownership will limit or preclude your ability to influence corporate matters, including the election of directors, amendments of our organizational documents, and any merger, consolidation, sale of all or substantially all of our assets, or other major corporate transaction requiring stockholder approval. None of our stockholders are party to any contractual lock-up agreement or other contractual restrictions on transfer with respect to this offering. Following our listing, sales of substantial amounts of our Class A common stock in the public markets, or the perception that sales might occur, could cause the market price of our Class A common stock to decline. If we are unable to adequately address these and other risks we face, our business, results of operations, financial condition, and prospects may be adversely affected. Corporate Information We were formed as "Pro Music Rights, LLC," a Florida limited liability company effective as of January 31, 2018. We converted into a Delaware corporation on November 4, 2020. We were initially formed as a Florida limited liability company on January 31, 2018, as Pro Music Rights LLC. On November 4, 2020, we converted into a Delaware corporation, Pro Music Rights, Inc., a Delaware corporation. Our principal executive offices are located at 3811 Airport-Pulling Road Office 203 Naples, FL 34105, and our telephone number is (833) 227-7683. Our website address is www.promusicrights.com. The information on, or that can be accessed through, our website is not incorporated by reference into this prospectus and should not be considered part of this prospectus. Investors should not rely on any such information in deciding whether to purchase our Class A common stock. The PMR design logo, "PRO," and our common law trademarks, service marks, or trade names appearing in this prospectus are the property of Pro Music Rights, Inc. Solely for convenience, our trademarks, tradenames, and service marks referred to in this prospectus appear without the , , and SM symbols, but those references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights to these trademarks, tradenames, and service marks. This prospectus contains additional trademarks, tradenames, and service marks of other companies that are the property of their respective owners. 5 Channels for Disclosure of Information Investors, the media, and others should note that, following the effectiveness of the registration statement of which this prospectus forms a part, we intend to announce material information to the public through filings with the SEC, the investor relations page on our website, blog posts on our website, press releases, public conference calls, webcasts, our twitter feed (https://twitter.com/ProMusicRights), our Facebook page (https://www.facebook.com/pages/category/Community/Pro-Music-Rights-103339518043130/), our Instagram account (https://www.instagram.com/promusicrights/), and our LinkedIn page (https://www.linkedin.com/company/promusicrights). Our website is https://promusicrights.com/. The information disclosed by the foregoing channels could be deemed to be material information. As such, we encourage investors, the media, and others to follow the channels listed above and to review the information disclosed through such channels. Any updates to the list of disclosure channels through which we will announce information will be posted on the investor relations page on our website. Implications of Being an Emerging Growth Company As a company with less than $1.07 billion in revenues during our last completed fiscal year, we qualify as an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of specified reduced reporting requirements that are otherwise applicable generally to public companies. These reduced reporting requirements include: an exemption from compliance with the auditor attestation requirement on the effectiveness of our internal control over financial reporting; an exemption from compliance with any requirement that the Public Company Accounting Oversight Board, or the PCAOB, has adopted regarding a supplement to the auditor s report providing additional information about the audit and the financial statements; reduced disclosure about our executive compensation arrangements; an exemption from the requirements to obtain a non-binding advisory vote on executive compensation or a stockholder approval of any golden parachute arrangements; and extended transition periods for complying with new or revised accounting standards. We will remain an emerging growth company until the earliest to occur of: (i) the end of the first fiscal year in which our annual gross revenues are $1.07 billion or more; (ii) the end of the first fiscal year in which we are deemed to be a "large accelerated filer," as defined in the Securities Exchange Act of 1934, as amended, or the Exchange Act; (iii) the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt securities; and (iv) the end of the fiscal year during which the fifth anniversary of this listing occurs. We may choose to take advantage of some, or all, of the available benefits under the JOBS Act. We are electing to use the extended transition periods available under the JOBS Act for complying with new or revised accounting standards, and we currently intend to take advantage of the other exemptions discussed above. Accordingly, the information contained herein may be different from the information you receive from other public companies in which you hold stock. 6 THE OFFERING SHARES OFFERED: 404,600,000 shares of Class A Common Stock OFFERING AMOUNT: $4,046,000.00 TERMS OF THE OFFERING: The Registered Stockholders will determine when and how they will sell the Class A common stock offered in this Prospectus. Unless there is an established trading market for securities, shares resold by Registered Stockholders in a public offering must sell at a fixed price of $0.01 per share. We cannot assure you that our Class A common stock will be quoted on the Over the Counter Bulletin Board or that an established trading market for securities will be established. CLASS A COMMON STOCK ISSUED AND OUTSTANDING BEFORE THIS OFFERING: 910,000,000 CLASS A COMMON STOCK ISSUED AND OUTSTANDING AFTER THIS OFFERING: 910,000,000 RISK FACTORS: See
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY The following summary highlights information contained in greater details elsewhere in this prospectus. This summary is not complete and does not contain all of the information you should consider in making your investment decision. You should read the entire prospectus carefully before making an investment in our common stock or warrants. You should carefully consider, among other things, our financial statements and related notes and the sections titled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations included elsewhere in this prospectus. Company Overview Terran Orbital is a U.S.-based manufacturer, owner and operator of satellites and related space-based solutions that provide Earth observation, data and analytics to defense, intelligence, civil and commercial end users. Through its subsidiary Tyvak Nano-Satellite Systems Inc. ( Terran Orbital Satellite Solutions ), Terran Orbital is a leading provider of next-generation, turnkey satellite solutions focused primarily on the small satellite market. Drawing from over a decade of its satellite solutions and mission support experience, Terran Orbital is developing, through its PredaSAR subsidiary ( Terran Orbital Earth Observation Solutions ), a constellation of NextGen Earth observation ( EO ) satellites using unique Synthetic Aperture Radar ( SAR ) data and electro-optical capabilities to provide EO data and mission solutions that it believes will be distinguished by breadth of coverage, revisit rates and ability to observe and detect during day and night and through clouds and other interference. Terran Orbital is a leader in satellite technology and satellite solutions serving U.S. government defense, intelligence and civil agencies, including the U.S. Department of Defense (the DoD ), the Space Development Agency (the SDA ) and the National Aeronautics and Space Administration ( NASA ), as well as aerospace and defense prime contractors, including Lockheed Martin and numerous other governmental and commercial businesses that operate in the high-growth sectors of satellite, space-based solutions. Terran Orbital Satellite Solutions works with established customers across federal agencies, including the DoD, Intelligence Community and major defense prime contractors. It also supports commercial and academic customers. Through Terran Orbital Satellite Solutions, Terran Orbital currently delivers end-to-end satellite solutions including spacecraft design, development, launch services and on-orbit operations for critical missions across a number of applications in a variety of orbits. Terran Orbital Satellite Solutions has over 65 flight-proven modules and devices which enable Terran Orbital to rapidly respond to customer needs. This deep portfolio of knowledge in design engineering has led to a track record of mission success, demonstrated by Terran Orbital Satellite Solutions over 80 missions executed. Terran Orbital Satellite Solutions continues to support numerous successful marquee agencies, including NASA and SDA. In addition, Terran Orbital Earth Observation Solutions has commenced building satellites and intends to continue to develop and launch the largest commercially operated NextGen Earth Observation constellation. Terran Orbital Earth Observation Solutions plans to provide near persistent global coverage and near real-time, mission-critical Earth observation data. Its first constellation of 96 satellites is currently planned to be completed and in-orbit by 2026 (the NextGen Earth Observation constellation ). Our NextGen Earth Observation constellation is projected to achieve under 10-minute average revisit rates (the rate at which a satellite constellation revisits a certain position over Earth, with higher revisit rates allowing more constant monitoring of the Earth s surface) once fully deployed. Our NextGen Earth Observation constellation relies on proprietary technology developed and owned by Terran Orbital. The satellites will feature SAR capabilities, which permit day and night observance through clouds and other interference. In addition, Terran Orbital Earth Observation Solutions plans to provide secondary payload solutions and onboard data processing capabilities on its satellite constellation, including additional sensors, optical links or other mission solutions. Terran Orbital Satellite Solutions will manufacture Terran Orbital Earth Observation constellation. Terran Orbital incurred a net loss of $71.4 million for the three months ended March 31, 2022 and Legacy Terran Orbital incurred a net loss of $77.5 million for the three months ended March 31, 2021, and a net loss of $139.0 million and $10.5 million for the years ended December 31, 2021 and December 31, 2020, respectively. Terran Orbital does not expect to become profitable in the near future and may never achieve profitability. Terran Orbital also expects its operating expenses to increase over the next several years as it scales its operations, increases research and development efforts relating to new offerings and technologies, and hires more employees. The Company also has a substantial amount of indebtedness, consisting of $120.0 million under the Francisco Partners Facility and approximately $56.3 million of Rollover Notes (as defined below), as well as $28.1 million of payment obligations owed to the Insider PIPE investor, in each case as of March 31, 2022. Table of Contents Trust Account means the trust account of Tailwind Two that held the proceeds from the IPO and a portion of the proceeds from the sale of the private placement warrants. VWAP means the volume weighted average price of the common stock, calculated in accordance with the Purchase Agreement. Warrants means the private placement warrants, the public warrants and the debt provider warrants. Warrant Agreement means the warrant agreement between Continental, as warrant agent, and Tailwind Two. Table of Contents Corporate Information Tailwind Two was incorporated on November 18, 2020 as a special purpose acquisition company and a Cayman Islands exempted company under the name Tailwind Two Acquisition Corp. On March 4, 2021, Tailwind Two completed its initial public offering. On March 25, 2022, Tailwind Two consummated the Business Combination with Terran Orbital pursuant to the Business Combination Agreement. In connection with the Business Combination, Tailwind Two s jurisdiction of incorporation was changed from the Cayman Islands to the State of Delaware, and Tailwind Two changed its name to Terran Orbital Corporation. Terran Orbital is a Delaware corporation. Terran Orbital s principal executive office is located at 6800 Broken Sound Parkway NW, Suite 200, Boca Raton, Florida 33487, and its telephone number is (561) 988-1704. Terran Orbital s corporate website address is www.terranorbital.com. Terran Orbital s website and the information contained on, or that can be accessed through, the website is not deemed to be incorporated by reference in, and is not considered part of, this registration statement. Committed Equity Financing On July 5, 2022, we entered into the Purchase Agreement and the Registration Rights Agreement with B. Riley Principal Capital II. Pursuant to the Purchase Agreement, we have the right to sell to B. Riley Principal Capital II up to $100,000,000 of shares of our common stock, subject to certain limitations and conditions set forth in the Purchase Agreement, from time to time during the term of the Purchase Agreement. Sales of common stock pursuant to the Purchase Agreement, and the timing of any sales, are solely at our option, and we are under no obligation to sell any securities to B. Riley Principal Capital II under the Purchase Agreement. In accordance with our obligations under the Registration Rights Agreement, we have filed the registration statement that includes this prospectus with the SEC to register under the Securities Act, the resale by B. Riley Principal Capital II of up to 27,714,791 shares of common stock, including (i) up to 27,500,000 shares of common stock that we may elect, in our sole discretion, to issue and sell to B. Riley Principal Capital II, from time to time from and after the Commencement Date under the Purchase Agreement, and (ii) 214,791 shares of common stock that we issued to B. Riley Principal Capital II on July 5, 2022 in consideration for its commitment to purchase shares of our common stock that we may, in our sole discretion, direct them to make from time to time after the date of this prospectus pursuant to the Purchase Agreement. Upon the initial satisfaction of the conditions to B. Riley Principal Capital II s purchase obligations set forth in the Purchase Agreement, including that the registration statement that includes this prospectus be declared effective by the SEC, we will have the right, but not the obligation, from time to time at our sole discretion over the 24-month period beginning on the Commencement Date, to direct B. Riley Principal Capital II to purchase a specified number of shares of common stock, not to exceed the lesser of: (i) 2,000,000 shares of common stock and (ii) 30.0% of the total aggregate number (or volume) of shares of our common stock traded on the NYSE during the applicable Purchase Valuation Period for such Purchase, by timely delivering written notice to B. Riley Principal Capital II prior to 9:00 a.m., New York City time, on any trading day, so long as (a) the closing sale price of our common stock on the NYSE on the trading day immediately prior to such Purchase Date is not less than the Threshold Price, and (b) all shares of common stock subject to all prior purchases effected by us under the Purchase Agreement have been received by B. Riley Principal Capital II prior to the time we deliver such Purchase Notice to B. Riley Principal Capital II. The per share purchase price that B. Riley Principal Capital II is required to pay for shares of our common stock in a Purchase effected by us pursuant to the Purchase Agreement, if any, will be determined by reference to the VWAP of the common stock, calculated in accordance with the Purchase Agreement, for Purchase Valuation Period beginning at the official open (or commencement ) of the regular trading session on the NYSE on the applicable Purchase Date for such Purchase, and ending at the earliest to occur of (i) 3:59 p.m., New York City time, on such Purchase Date or such earlier time publicly announced by the trading market as the official close of the regular trading session on such Purchase Date, (ii) such time that the total aggregate number (or volume) of shares of common stock traded on the NYSE during such Purchase Valuation Period (calculated in accordance with the Purchase Agreement) reaches the Purchase Share Volume Maximum, calculated by dividing (a) the applicable Purchase Share Amount for such Purchase, by (b) 0.30, and (iii) such time that the trading price of a share of common stock on the NYSE during such Purchase Valuation Period (calculated in accordance with the Purchase Agreement) falls below the applicable minimum price threshold for such Purchase specified by us in the Purchase Notice for such Purchase, or if we do not specify a minimum price threshold in such Purchase Notice, a price equal to 90.0% of the closing sale price of the common stock on the trading day immediately prior to the applicable Purchase Date for such Purchase, less a fixed 3.0% discount to the VWAP for such Purchase Valuation Period. In addition to the regular Purchases described above, after the Commencement, we will also have the right, but not the obligation, subject to the continued satisfaction of the conditions set forth in the Purchase Agreement, to direct B. Riley Principal Capital II to purchase, on any trading day, including the same Purchase Date on which a regular Purchase is effected (if any, although we are not required to effect an earlier regular Purchase on such trading day), a specified number of shares of common stock, not to exceed the lesser of: (i) 2,000,000 shares of common stock and (ii) 30.0% of the total aggregate volume of shares of our common stock traded on the NYSE during the applicable Intraday Purchase Valuation Period (determined in the same manner as for a regular Purchase) for such Intraday Purchase, by the delivery to B. Riley Principal Capital II of an irrevocable written purchase notice, after 10:00 a.m., New York City time (and after the Purchase Valuation Period for any prior regular Purchase (if any) and the Intraday Purchase Valuation Period for the most recent prior Intraday Purchase effected on the same Purchase Date (if any) have ended), and prior to 3:00 p.m., New York City time, on such Purchase Date, so long as (i) the closing sale price of the common stock on the trading day immediately prior to such Purchase Date is not less than the Threshold Price and (ii) all shares of common stock subject to all prior Purchases and all prior Intraday Purchases by B. Riley Principal Capital II under the Purchase Agreement have been received by B. Riley Principal Capital II prior to the time we deliver such Intraday Purchase Notice to B. Riley Principal Capital II. The per share purchase price for the shares of common stock that we elect to sell to B. Riley Principal Capital II in an Intraday Purchase pursuant to the Purchase Agreement, if any, will be calculated in the same manner as in the case of a regular Purchase (including the same fixed percentage discounts to the applicable VWAP as in the case of a regular Purchase, as described above), provided that the VWAP for each Intraday Purchase effected on a Purchase Date will be calculated over different periods during the regular trading session on the NYSE on such Purchase Date, each of which will commence and end at different times on such Purchase Date. There is no upper limit on the price per share that B. Riley Principal Capital II could be obligated to pay for the common stock we may elect to sell to it in any Purchase or any Intraday Purchase under the Purchase Agreement. In the case of Purchases and Intraday Purchases effected by us under the Purchase Agreement, if any, all share and dollar amounts used in determining the purchase price per share of common stock to be purchased by B. Riley Principal Capital II in a Purchase or an Intraday Purchase (as applicable), or in determining the applicable maximum purchase share amounts or applicable volume or price threshold amounts in connection with any such Purchase or Intraday Purchase (as applicable), in each case, will be equitably adjusted for any reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or other similar transaction occurring during any period used to calculate such per share purchase price, maximum purchase share amounts or applicable volume or price threshold amounts. From and after Commencement, we will control the timing and amount of any sales of common stock to B. Riley Principal Capital II. Actual sales of shares of common stock to B. Riley Principal Capital II under the Purchase Agreement will depend on a variety of factors to be determined by us from time to time, including, among other things, market conditions, the trading price of the common stock and determinations by us as to the appropriate sources of funding for its business and its operations. Under the applicable NYSE rules, in no event may we issue to B. Riley Principal Capital II under the Purchase Agreement more than 27,500,000 shares of common stock, which number of shares is equal to approximately 19.99% of the shares of the common stock outstanding immediately prior to the execution of the Purchase Agreement, unless we obtain stockholder approval to issue shares of common stock in excess of the Exchange Cap in accordance with applicable the NYSE rules. The Exchange Cap is not applicable to issuances and sales of common stock pursuant to Purchases and Intraday Purchases that we may effect pursuant to the Purchase Agreement, to the extent such shares of common stock are sold in such Purchases and Intraday Purchases (as applicable) at a price equal to or in excess of the applicable minimum price (as defined in the applicable listing rules of the NYSE) of the common stock, calculated at the time such Purchases and Intraday Purchases (as applicable) are effected by us under the Purchase Agreement, if any, as adjusted to take into account our issuance of the Commitment Shares to B. Riley Principal Capital II and our reimbursement of a certain amount of B. Riley Principal Capital II s legal fees and expenses. Moreover, we may not issue or sell any shares of common stock to B. Riley Principal Capital II under the Purchase Agreement which, when aggregated with all other shares of common stock then beneficially owned by B. Riley Principal Capital II and its affiliates (as calculated pursuant to Section 13(d) of the Exchange Act, and Rule 13d-3 thereunder), would result in B. Riley Principal Capital II beneficially owning more than 4.99% of the outstanding shares of common stock. The net proceeds to us from sales that we elect to make to B. Riley Principal Capital II under the Purchase Agreement, if any, will depend on the frequency and prices at which we sell shares of our stock to B. Riley Principal Capital II. We expect that any proceeds received by us from such sales to B. Riley Principal Capital II will be used for investment in growth and general corporate purposes. There are no restrictions on future financings, rights of first refusal, participation rights, penalties or liquidated damages in the Purchase Agreement or Registration Rights Agreement, other than a prohibition (with certain limited exceptions) on entering into specified Variable Rate Transactions (as such term is defined in the Purchase Agreement) during the term of the Purchase Agreement. Such transactions include, among others, the issuance of convertible securities with a conversion or exercise price that is based upon or varies with the trading price of our common stock after the date of issuance, or our effecting or entering into an agreement to effect an equity line of credit or other substantially similar continuous offering with a third party, in which we may offer, issue or sell common stock or any securities exercisable, exchangeable or convertible into common stock at a future determined price. B. Riley Principal Capital II has agreed that none of B. Riley Principal Capital II, its sole member, any of their respective officers, or any entity managed or controlled by B. Riley Principal Capital II or its sole member, will engage in or effect, directly or indirectly, for its own account or for the account of any other of such persons or entities, any short sales of the common stock or hedging transaction that establishes a net short position in the common stock during the term of the Purchase Agreement. The Purchase Agreement will automatically terminate on the earliest to occur of (i) the first day of the month next following the 24-month anniversary of the Commencement Date, (ii) the date on which the Selling Stockholder shall have purchased from us under the Purchase Agreement shares of common stock for an aggregate gross purchase price of $100,000,000, (iii) the date on which the common stock shall have failed to be listed or quoted on the NYSE or another U.S. national securities exchange identified as an eligible market in the Purchase Agreement, (iv) the 30th trading day after the date on which the Company commences a voluntary proceeding or any third party commences a bankruptcy proceeding against the Company that is not discharged or dismissed prior to such trading day, and (v) the date on which a bankruptcy custodian is appointed for all or substantially all of our property or we make a general assignment for the benefit of creditors. We have the right to terminate the Purchase Agreement at any time after Commencement, at no cost or penalty, upon ten (10) trading days prior written notice to B. Riley Principal Capital II. B. Riley Principal Capital II has the right to terminate the Purchase Agreement upon ten (10) business days prior written notice to the Company upon the occurrence of certain events set forth in the Purchase Agreement. We and B. Riley Principal Capital II may also agree to terminate the Purchase Agreement by mutual written consent, provided that no termination of the Purchase Agreement will be effective until the fifth trading day immediately following the settlement date related to any pending Purchase that has not been fully settled in accordance with the Purchase Agreement. Neither we nor B. Riley Principal Capital II may assign or transfer our respective rights and obligations under the Purchase Agreement or the Registration Rights Agreement, and no provision of the Purchase Agreement or the Registration Rights Agreement may be modified or waived by us or B. Riley Principal Capital II. As consideration for B. Riley Principal Capital II s commitment to purchase shares of common stock at our direction upon the terms and subject to the conditions set forth in the Purchase Agreement, upon execution of the Purchase Agreement, we issued 214,791 Commitment Shares to B. Riley Principal Capital II. In addition, we reimbursed $50,000 of reasonable legal fees and disbursements of B. Riley Principal Capital II s legal counsel in connection with the transactions contemplated by the Purchase Agreement and the Registration Rights Agreement and have agreed to reimburse up to an additional $25,000 prior to Commencement. The Purchase Agreement and the Registration Rights Agreement contain customary representations, warranties, conditions and indemnification obligations of the parties. Copies of the agreements have been filed as exhibits to the registration statement that includes this prospectus and are available electronically on the SEC s website at www.sec.gov. We do not know what the purchase price for our common stock will be and therefore cannot be certain as to the number of shares we might issue to B. Riley Principal Capital II under the Purchase Agreement after the Commencement Date. As of July 6, 2022, there were 137,805,599 shares of our common stock outstanding, of which 56,285,546 shares were held by non-affiliates of our company. Although the Purchase Agreement provides that we may sell up to $100,000,000 of our common stock to the B. Riley Principal Capital II, only 27,714,791 shares of our common stock are being registered under the Securities Act for resale by the Selling Stockholder under this prospectus, which represents the 214,791 Commitment Shares that we issued to B. Riley Principal Capital II on July 5, 2022 following the execution of the Purchase Agreement, and up to 27,500,000 shares of common stock that may be issued to B. Riley Principal Capital II from and after the Commencement Date, if and when we elect to sell shares to B. Riley Principal Capital II under the Purchase Agreement. Depending on the market prices of our common stock at the time we elect to issue and sell shares to B. Riley Principal Capital II under the Purchase Agreement, we may need to register under the Securities Act additional shares of our common stock for resale by the Selling Stockholder in order to receive aggregate gross proceeds equal to the $100,000,000 Total Commitment available to us under the Purchase Agreement. If all of the 27,714,791 shares offered for resale by B. Riley Principal Capital II under this prospectus were issued and outstanding as of the date hereof, such shares would represent approximately 16.8% of the total number of outstanding shares of common stock and approximately 33.1% of the total number of outstanding shares of common stock held by non-affiliates of our company, in each case as of July 6, 2022. If we elect to issue and sell more than the 27,500,000 shares offered under this prospectus to B. Riley Principal Capital II, which we have the right, but not the obligation, to do, we must first register under the Securities Act such additional shares of common stock for resale by B. Riley Principal Capital II, which could cause additional substantial dilution to our stockholders. The number of shares of common stock ultimately offered for resale by B. Riley Principal Capital II through this prospectus is dependent upon the number of shares of common stock, if any, we elect to sell to B. Riley Principal Capital II under the Purchase Agreement from and after the Commencement Date. The issuance of our common stock to B. Riley Principal Capital II pursuant to the Purchase Agreement will not affect the rights or privileges of our existing stockholders, except that the economic and voting interests of each of our existing stockholders will be diluted. Although the number of shares of our common stock that our existing stockholders own will not decrease, the shares of our common stock owned by our existing stockholders will represent a smaller percentage of our total outstanding shares of our common stock after any such issuance.
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+This summary highlights selected information from this prospectus and does not contain all of the information that is important to making an investment decision. Before investing in our securities, you should carefully read this entire prospectus, including our financial statements and the related notes included in this prospectus and the information set forth under the headings Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations. See also the section entitled Where You Can Find Additional Information. Unless otherwise indicated or the context otherwise requires, references in this Business Summary to we, us, our and other similar terms refer to Fathom OpCo and its subsidiaries prior to the Business Combination and to Fathom and its consolidated subsidiaries after giving effect to the Business Combination. Our Mission Our mission is to accelerate manufacturing innovation for the most product-driven companies in the world. Business Overview Fathom is a leading on-demand digital manufacturing platform in North America, providing comprehensive product development and on-demand manufacturing services to many of the largest and most innovative companies in the world. We have extensive expertise in both additive and traditional manufacturing, enabling our agile, technology-agnostic platform to blend manufacturing technologies and processes to deliver hybridized solutions designed to meet the specific needs of our customers. This flexible problem-solving approach empowers our customers to accelerate their product development cycles, reducing manufacturing lead times for low- to mid-volume production. We combine diverse, scaled manufacturing capabilities and deep technical know-how to enable our customers to get to market faster, putting their design and product goals above the manufacturing limitations often imposed by other service providers. We pair our expertise and manufacturing capabilities with a unified proprietary suite of software which becomes an extension of the customer s digital product development and low- to mid-volume production threads. By continuously augmenting our software suite to stay in tune with evolving Industry 4.0 trends, we believe our platform is ideally suited to serve the product development and low- to mid-volume production parts needs of the largest and most innovative companies in the world. Our differentiated strategy focuses on speed, problem solving, adaptive technical responsiveness, and a focus on manufacturing to meet customers design intent allowing our customers to iterate faster and shorten their product development and production cycles from months to days. Our deep technical expertise and integrated, software-driven approach underpin a comprehensive suite of capabilities, with over 25 unique manufacturing processes spread across 12 manufacturing facilities with nearly 450,000 sq. ft. of manufacturing capacity in the United States. Our scale and breadth of offering allows our customers to consolidate their supply chain and product development needs and to source through a single supplier. Fathom seamlessly blends in-house capabilities of 530+ advanced manufacturing systems across plastic and metal additive technologies (90+ industrial-grade systems), CNC machining, injection molding and tooling, precision sheet metal fabrication, and design engineering, catering to a broad set of end markets. Fathom s manufacturing technologies and capacity are further extended through utilization of a selected group of highly qualified suppliers who specialize in injection molding and tooling and CNC machining. With over 35 years of industry experience, Fathom is at the forefront of the Industry 4.0 digital manufacturing revolution, serving customers in the technology, defense, aerospace, medical, automotive and IOT Table of Contents The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents ABOUT THIS PROSPECTUS This prospectus is part of a registration statement on Form S-1 that we filed with the Securities and Exchange Commission (the SEC ) using the shelf registration process. Under this shelf registration process, the Selling Stockholders may, from time to time, sell the securities offered by them described in this prospectus. We will not receive any proceeds from the resale of Class A common stock or Private Placement Warrants by the Selling Stockholders. This prospectus also relates to the issuance by us of the shares of Class A common stock issuable upon the exercise of the Warrants. We will receive proceeds from any exercise of the Warrants for cash. Neither we nor the Selling Stockholders have authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or any applicable prospectus supplement or any free writing prospectuses prepared by or on behalf of us or to which we have referred you. Neither we nor the Selling Stockholders take responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. Neither we nor the Selling Stockholders will make an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. We may also provide a prospectus supplement or post-effective amendment to the registration statement to add information to, or update or change information contained in, this prospectus. You should read both this prospectus and any applicable prospectus supplement or post-effective amendment to the registration statement together with the additional information to which we refer you in the section of this prospectus entitled Where You Can Find More Information. Neither we nor the Selling Stockholders have authorized anyone to provide any information or to make any representations other than those contained in this prospectus, any accompanying prospectus supplement or any free writing prospectus we have prepared. We and the Selling Stockholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the securities offered hereby and only under circumstances and in jurisdictions where it is lawful to do so. No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus, any applicable prospectus supplement or any related free writing prospectus. This prospectus is not an offer to sell securities, and it is not soliciting an offer to buy securities, in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus or any prospectus supplement is accurate only as of the date on the front of those documents, regardless of the time of delivery of this prospectus or any applicable prospectus supplement, or any sale of a security. Our business, financial condition, results of operations and prospects may have changed since those dates. For investors outside the United States: neither we nor the Selling Stockholders have done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of our securities and the distribution of this prospectus outside the United States. This prospectus contains summaries of certain provisions contained in some of the documents described herein, but reference is made to the actual documents for complete information. All of the summaries are qualified in their entirety by the actual documents. Copies of some of the documents referred to herein have been filed, will be filed or will be incorporated by reference as exhibits to the registration statement of which this prospectus is a part, and you may obtain copies of those documents as described in this prospectus under Where You Can Find More Information. Table of Contents sectors. Fathom s certifications include: ISO 9001:2015, ISO 13485:2016, AS9100:2016, NIST 800-171 and ITAR registered. Fathom is also a platform built for taking advantage of attractive future M&A opportunities. Fathom s successful and proven acquisition strategy is enabled by our unique integration playbook including our proprietary software platform, which allows a streamlined integration of acquired companies. Over the past three years, we have successfully completed 13 acquisitions to bolster our operations and service offerings. Fathom s business was founded in 1984 under the name Midwest Composite Technologies, LLC. Following the merger of MCT and Fathom OpCo in 2019, the business was rebranded to operate under the Fathom Digital Manufacturing name and key technical capabilities were added in direct response to the needs of our largest and most innovative corporate customers. Today, Fathom is the result of the successful integration of 13 complementary companies, acquired over the past three years, creating a robust on-demand digital manufacturing platform with a proven array of additive and traditional manufacturing capabilities. As a result of our scale and superior offerings, we have developed a loyal base of approximately 3,000 customers, including many of the largest and most innovative companies in the world, with excellent representation across Fortune s 500 list. As of December 31, 2020 our customers included: (i) 7 of the top 10 aerospace companies, (ii) 4 of the top 10 automotive and electric vehicle companies, (iii) 4 of the top 10 consumer companies, (iv) 8 of the top 10 industrial companies, (v) 8 of the top 10 medical companies and (vi) 7 of the top 10 technology companies. Over the last twelve months ended March 31, 2021, no single customer represented more than 6% of our total revenue, and overall customer retention was 91%. Our target market is comprised of the highly fragmented U.S. low- to mid-volume manufacturing market of CNC machining, injection molding, precision sheet metal and additive manufacturing. This market is projected to grow from $25 billion in 2020 to $33 billion in 2025, fueled by growth in demand for additive manufacturing and continuation of the trend of customers increasingly outsourcing their product development prototyping and low- to mid-volume manufacturing needs. Industry Opportunities Overall, manufacturing is a very large but highly fragmented market undergoing disruptive changes driven by rapid advances in how products are being designed and manufactured enabled by the adoption of Industry 4.0 practices. The overall manufacturing market is one of the largest industries in the world, using industrial design processes to turn raw materials into components and finished goods ranging from aircraft to microelectronics. Taking a new product from customer requirements through a design concept, the product development cycle and eventually to manufacture is a complex, costly and time-consuming process. Product development and manufacturing processes are undergoing disruptive changes driven by Industry 4.0 practices, the next wave of the Industrial Revolution. According to IBIS World, a research firm, there are over 570,000 manufacturing businesses in the United States employing over 11.3 million employees. The manufacturing industry is highly fragmented with over 75% of these manufacturing businesses employing less than 20 people, according to a study by SCORE, a research firm. The US Bureau of Labor Statistics reported that there are approximately 2.7 million engineers and technicians with about 75% employed in the manufacturing, professional, scientific, technical, and government sectors. Within the overall manufacturing market, the highly fragmented low- to mid- volume precision sheet metal fabrication, injection molding, CNC machining, and additive manufacturing market is estimated to be approximately $25 billion. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be issued until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and does not constitute the solicitation of an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED JANUARY 26, 2022 PRELIMINARY PROSPECTUS PROSPECTUS FOR 45,423,250 SHARES OF CLASS A COMMON STOCK 9,900,000 WARRANTS TO PURCHASE SHARES OF CLASS A COMMON STOCK 18,525,000 SHARES OF CLASS A COMMON STOCK UNDERLYING WARRANTS TO PURCHASE CLASS A COMMON STOCK AND 90,570,234 SHARES OF CLASS A COMMON STOCK UNDERLYING CLASS B COMMON STOCK OF FATHOM DIGITAL MANUFACTURING CORPORATION This prospectus relates to the resale from time to time by the Selling Stockholders named in this prospectus or their permitted transferees (collectively, the Selling Stockholders ) of: (i) up to 36,661,014 shares of Class A common stock, par value $0.0001 per share (the Class A common stock ) issued to the Legacy Fathom Owners in connection with the closing of the Business Combination, (ii) up to 4,770,000 shares of Class A common stock held by Altimar Sponsor II, LLC ( Sponsor ) and the other Altimar II Founders following the closing of the Business Combination, (iii) up to 2,724,736 Earnout Shares issued to certain Legacy Fathom Owners, and (iv) up to 1,267,500 Sponsor Earnout Shares. This prospectus also relates to (a) the resale of up to 9,900,000 Private Placement Warrants to purchase shares of Class A common stock held by Sponsor (b) the issuance by us of up to 18,525,000 shares of Class A common stock upon the exercise of outstanding Public Warrants and Private Placement Warrants to purchase shares of Class A common stock, and (c) the issuance by us of up to 90,570,234 shares of Class A common stock issuable upon the exchange of New Fathom Units (together with a corresponding number of shares of Class B common stock) held by certain of the Selling Stockholders (including 6,275,264 Earnout Shares presently represented in the form of unvested New Fathom Units). On December 23, 2021 (the Closing Date ), Altimar Acquisition Corp. II, a blank check company incorporated as a Cayman Islands exempted company ( Altimar II ), domesticated as a Delaware corporation (the Domestication ) and changed its name to Fathom Digital Manufacturing Corporation ( Fathom or, the Company ). Immediately following the Domestication, Fathom completed the previously announced business combination (the Business Combination ) pursuant to the terms of the Business Combination Agreement, dated as of July 15, 2021, as amended by Amendment No. 1 to Business Combination Agreement, dated as of November 16, 2021 (as so amended, the BCA or the Business Combination Agreement ) by and among Altimar II, Fathom Holdco, LLC, a Delaware limited liability company ( Fathom OpCo ), Rapid Merger Sub, LLC, a Delaware limited liability company and a direct, wholly owned subsidiary of Altimar II ( Merger Sub ), and the other parties thereto. As part of the completion of the transactions contemplated by the Business Combination Agreement (the Transactions, and such completion, the Closing ), Merger Sub merged with and into Fathom OpCo (the Merger ), with Fathom OpCo being the surviving entity of the Merger. As a result of the Merger and the other Transactions, the combined company was organized in an Up-C structure, with Fathom now serving as the managing member of Fathom OpCo. Fathom OpCo is now owned in part by former public and private shareholders of Altimar II and in part by continuing equity owners of Fathom OpCo (the Legacy Fathom Owners ). The Selling Stockholders may offer, sell or distribute all or a portion of the shares of Class A common stock and Private Placement Warrants registered hereby publicly or through private transactions at prevailing market prices or at negotiated prices. We provide more information about how the Selling Stockholders may sell their securities in the section entitled Plan of Distribution. We are registering the resale of securities as required by that certain Registration Rights Agreement, dated as of December 23, 2021, by and among us and certain of our shareholders (the Registration Rights Agreement ). We are also registering the issuance of the shares of Class A common stock underlying the Public Warrants and the Private Placement Warrants as required by that certain Warrant Agreement, dated as of February 4, 2021, by and between our predecessor entity, Altimar II, and Continental Stock Transfer & Trust Company. We will receive the proceeds from any exercise of the Warrants for cash, but not from the resale of the shares of common stock or Warrants by the Selling Stockholders. We will pay certain offering fees and expenses and fees in connection with the registration of the Class A common stock and Warrants and will not receive proceeds from the sale of the shares of Class A common stock or Private Placement Warrants by the Selling Stockholders. The Selling Stockholders will bear all commissions and discounts, if any, attributable to their respective sales of the Class A common stock and Private Placement Warrants. Our Class A common stock is currently listed on the New York Stock Exchange (the NYSE ) and trades under the symbol FATH. Our Public Warrants are currently listed on the NYSE and trade under the symbol FATH.WS. On January 25, 2022, the closing sale price of our common stock was $10.68 per share and the closing price of our Public Warrants was $1.11 per Public Warrant. We are an emerging growth company and a smaller reporting company as those terms are defined under applicable federal securities laws, and as such, are subject to certain reduced public company reporting requirements. INVESTING IN OUR COMMON STOCK OR WARRANTS INVOLVES RISKS THAT ARE DESCRIBED IN THE RISK FACTORS SECTION BEGINNING ON PAGE 12 OF THIS PROSPECTUS. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued under this prospectus or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents SELECTED DEFINITIONS When used in this Prospectus, unless the context otherwise requires: Adjusted EBITDA , a non-GAAP measure, means net losses before the impact of interest income or expense, income tax expense and depreciation and amortization, and further adjusted for the following items: stock-based compensation, transaction-related costs, and certain other non-cash and non-core items. Altimar II refers to Altimar Acquisition Corp. II, a blank check company incorporated as a Cayman Islands exempted company. Altimar II Founders refers to the Sponsor and the following former seven members of the board of directors of Altimar II: Kevin Beebe, Payne Brown, Rick Jelinek, Roma Khanna, Michael Rubenstein, Vijay Sondhi and Michael Vorhaus and each of their respective permitted transferees and assigns. Altimar II IPO refers to Altimar II s initial public offering of its units, Public Shares and Public Warrants pursuant to the IPO registration statement, completed on February 9, 2021. Amended and Restated Memorandum and Articles of Association refers to Altimar II s Amended and Restated Memorandum and Articles of Association, effective as of February 4, 2021, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms. BCA or Business Combination Agreement refers to the Business Combination Agreement, dated as of July 15, 2021 and amended as of November 16, 2021, by and among Altimar II, Fathom OpCo and the other parties thereto. Board refers to Fathom s board of directors. Business Combination refers to the transactions contemplated by the BCA. Bylaws refers to the amended and restated bylaws of Fathom Digital Manufacturing Corporation, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms. Cayman Islands Companies Act refers to the Cayman Islands Companies Act (As Revised) of the Cayman Islands. Centex refers to Centex Machine and Welding, Inc. Charter refers to the certificate of incorporation of Fathom Digital Manufacturing Corporation, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms. Class A common stock refers to the Class A common stock, par value $0.0001 per share, of Fathom, including any shares of such Class A common stock issuable upon the exercise of any Warrant or other right to acquire shares of such Class A common stock. Class B common stock refers to the non-economic, voting Class B common stock, par value $0.0001 per share, of Fathom, including any shares of such Class B common stock issuable upon the exercise of any right to acquire shares of such Class B common stock. Closing refers to the closing of the Business Combination. common stock refers to shares of the Class A common stock and the Class B common stock, collectively. Company, our, we or us refers, prior to the consummation of the Business Combination, to Altimar II or Fathom OpCo, as the context suggests, and, following the Business Combination, to Fathom. Table of Contents Shorter product life cycles and demanding customer requirements are changing how companies develop and manufacture new products. Over the past decade, R&D spending in the manufacturing sector has increased from $445 billion in 2010 to an estimated $600+ billion in 2021. Over this period, new products have contributed a growing share of total corporate revenue, requiring an ever-increasing speed and frequency of new product launches. In 2010, 220,000 new products were launched, while in 2021 more than 350,000 new products were launched. These trends are pushing companies to innovate faster by accelerating product development cycles to increase their frequency of product launches. Companies must be very agile to be successful. Product designs are also becoming more complex as companies strive to launch more differentiated and higher functioning products and push manufacturing constraints using increasingly advanced manufacturing processes. As their product portfolio becomes more diverse and customized, companies must manage their manufacturing supply chain to be more localized and on-demand. By digitizing their product lifecycle companies can simplify and consolidate their supply chain. Deployment of maturing Industry 4.0 practices shortens product time-to-market and provides agility but requires companies to seek out advanced manufacturing partners. Industry 4.0 is primarily driven by the digitization of manufacturing including the commercialization of additive manufacturing complemented by advanced traditional manufacturing technologies. Advancements in software tools and the use of artificial intelligence/machine learning techniques help to digitize the entire product development and manufacturing lifecycle. The digitization of manufacturing is changing how new products are designed, manufactured and serviced, generating a large need for more on-demand manufacturing at the same time. Additive manufacturing, complemented by key advanced traditional manufacturing technologies, offers greater agility and flexibility than traditional manufacturing technologies. These technologies are capable of meeting the rigorous demands of corporate customers in the aerospace, automotive, industrial, medical and consumer sectors where products are highly engineered with precise specifications. On-demand manufacturing technologies allow custom production of parts in low- to mid- volume quantities with condensed turnaround times. As summarized below, these technologies are highly flexible and adaptive: Additive manufacturing can produce highly complex parts using printed materials which would otherwise be extremely difficult to produce via traditional methods. CNC machining is a subtractive manufacturing process that utilizes a variety of precision computer guided tools. This process yields products with precision and repeatability, while offering high-quality surface finish optionality. Injection molding offers the ability to rapidly produce complex parts using molten material, formed in molds. This process delivers consistency, quality, and cost-effectiveness for larger-scale production. Precision sheet metal fabrication involves cutting and bending of metal sheets, resulting in parts which are highly durable. Lower production expenses make this a highly attractive fabrication process for low-volume jobs with fewer timing constraints. Technological advancements are expected to drive continued growth in on-demand digital manufacturing technologies. As advances in additive manufacturing make it better suited for higher-volume applications, it is expected to take share from traditional manufacturing processes. Additive manufacturing offers the benefits of speed, part consolidation, weight reduction, and the ability to create complex geometries. Table of Contents Continuing Fathom Unitholders refers to equity owners of Fathom OpCo that continue to hold equity in Fathom OpCo following the Business Combination. CORE Investors refers to CORE Industrial Partners Fund I, L.P. and CORE Industrial Partners Fund I Parallel, L.P. Dahlquist refers to Dahlquist Machine, Inc. DGCL refers to the Delaware General Corporation Law, as amended. dollars or $ refers to U.S. dollars. Domestication refers to the continuation of Altimar II by way of domestication of Altimar II into a Delaware corporation on December 23, 2021 immediately prior to the Closing, with the ordinary shares of Altimar II becoming shares of common stock of the Delaware corporation under the applicable provisions of the Cayman Islands Companies Act and the DGCL; the term includes all matters and necessary or ancillary changes in order to effect such Domestication, including the adoption of our Charter, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms) consistent with the DGCL and changing the name and registered office of Altimar II. Earnout Shares means (a) a number of shares of Class A common stock and New Fathom Units, in the aggregate equal to 3,000,000, subject to a $12.50 volume weighted average price vesting threshold as set forth in the Investor Rights Agreement or Fathom Operating Agreement, as applicable, (b) a number of shares of Class A common stock and New Fathom Units, in the aggregate equal to 3,000,000, subject to a $15.00 volume weighted average price vesting threshold as set forth in the Investor Rights Agreement or Fathom Operating Agreement, as applicable, and (c) a number of shares of Class A common stock and New Fathom Units, in the aggregate equal to 3,000,000, subject to a $20.00 volume weighted average price vesting threshold as set forth in the Investor Rights Agreement or Fathom Operating Agreement, as applicable, in each case, to be allocated as set forth on the Allocation Schedule in the BCA. Exchange Act means the Securities Exchange Act of 1934, as amended. Fathom refers to Fathom Digital Manufacturing Corporation, a Delaware corporation and the combined company following the consummation of the Business Combination, and its consolidated subsidiaries. Fathom Blocker Owners means CORE Industrial Partners Fund I Parallel, LP, Siguler Guff Small Buyout Opportunities Fund III, LP, Siguler Guff Small Buyout Opportunities Fund III (F), LP, Siguler Guff Small Buyout Opportunities Fund III (C), LP, Siguler Guff Small Buyout Opportunities III (UK), LP, Siguler Guff HP Opportunities Fund II, LP, and Siguler Guff Americas Opportunities Fund, LP. Fathom OpCo refers to Fathom Holdco, LLC, a Delaware limited liability company. Fathom Operating Agreement refers to the Second Amended and Restated Limited Liability Company Agreement of Fathom OpCo, entered into by and among Fathom OpCo and the other parties thereto as of December 23, 2021 at the Closing, as it may be amended from time to time (as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms). Forfeiture and Support Agreement refers to the Forfeiture and Support Agreement, dated as of July 15, 2021 and amended as of November 16, 2021, by and among Altimar Sponsor II, LLC, the other Altimar II Founders party thereto, Altimar Acquisition Corp. II, Fathom and the other parties thereto, as the same may be further amended, modified, supplemented or waived from time to time in accordance with its terms. Forfeited Shares means an aggregate of 2,587,500 shares of Class A common stock forfeited pro rata by the Altimar II Founders pursuant to the Forfeiture and Support Agreement. Forfeited Shares shall have a correlative meaning to Forfeiture for purposes of this prospectus. Table of Contents CNC machining has exhibited rapid technological advances over the past five to ten years and has gained significant share as a result. CNC workflow improvements have streamlined the process, reducing costs. While injection molding production serves a mature market, advances in fast-turnaround applications are driving growth which should not be overlooked. Precision sheet metal fabrication is projected to grow at an accelerated rate between 2020 and 2025. These technologies have driven significant advancements, improving speed, volumes, material capabilities, and the overall customer experience. Companies leveraging these advanced technologies, particularly the largest and most innovative, are likely to see significant improvements in efficiencies across their entire manufacturing supply chain. In search of further efficiencies, large enterprise companies are regionalizing and shortening their supply chain and consolidating their supplier partners These same companies are working to take advantage of Industry 4.0 technologies and advancement in the hybridized model of additive manufacturing and advance traditional manufacturing technologies to optimize new product development and manufacturing. Through technological advances, additive manufacturing and other traditional processes are expected to become more accessible, enabling in-house adoption. However, in-house production lines are often underutilized, inefficient, and are not cost effective when used solely for internal needs. In-house manufacturing options often lack the scale and capabilities to deliver end-to-end solutions required by corporate customers. Within the $25 billion low- to mid- volume market for precision sheet metal fabrication, injection molding, CNC machining, and additive manufacturing, we estimate that approximately 40% is handled in-house, 55%+ is serviced by regional design services bureaus, and the remaining ~5% is captured by legacy digital manufacturers. There are thousands of small regional design services bureaus nationwide, most of which possess specialized and limited-service offerings. Some of these regional bureaus serve large enterprise companies but are constrained by inability to scale to meet the requirements of these demanding customers along with the scarcity of skilled labor and limited capacity. Legacy on-demand digital manufacturers are focused on prosumers and we believe their focus on automation often compromises the flexibility required to meet the evolving needs of corporate customers. We also believe that these legacy digital manufacturers are best-suited for simple, template-based part production and that their low-touch business model typically is predicated on serving thousands of individual product developers. On-demand digital manufacturing brokers have limited in-house production and must therefore outsource much of their own production needs, limiting oversight of the production process and hindering quality control and the ability to deliver complex parts. Involving multiple manufacturing suppliers also increases customer concerns relating to the safeguarding of intellectual property. We believe that large enterprise companies, which represent 50-60% of the outsourced portion of this $25 billion low- to mid-volume manufacturing market, are seeking collaborative, long-term partnerships with their key manufacturing suppliers, and in particular a partner that can advance Industry 4.0 practices to scale with them and ultimately allow them to simplify and shorten their supply chain. Fathom s value proposition and strategic partnership approach positions the Company to continue taking share from regional design bureaus and legacy digital manufacturers in the $25 billion low- to mid-volume manufacturing market. Business Strengths and Strategies Our key competitive strengths We enable some of the world s largest and most innovative companies to accelerate new product development and shorten time to market from months to weeks (or even days). We believe our position as a Table of Contents Founder shares refers to the Class B ordinary shares of Altimar II held by the Altimar II Founders. GAAP refers to United States generally accepted accounting principles, consistently applied. GPI refers to GPI Prototype & Manufacturing Services, LLC. ICOMold means ICOMold, LLC. Incodema refers to Incodema Holdings, Inc. Investor Rights Agreement refers to the Investor Rights Agreement, entered into by and among Fathom and the other parties thereto as of December 23, 2021 at the Closing, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms. Laser refers to Laser Manufacturing, Inc. Legacy Fathom Owners means, collectively, the Fathom Blocker Owners and the Continuing Fathom Unitholders. Majestic Metals refers to Majestic Metals, LLC. Mark Two refers to Mark Two Engineering, LLC. MCT means Midwest Composite Technologies, LLC. Merger refers to the merger at the Closing of Merger Sub with and into Fathom OpCo, with Fathom OpCo as the surviving entity. Merger Sub refers to Rapid Merger Sub, LLC, a Delaware limited liability company and a direct, wholly owned subsidiary of Altimar II. Micropulse West refers to Sureshot Precision, LLC d/b/a Micropulse West. New Credit Agreement means the new credit agreement entered into as of December 23, 2021 in connection with the Closing of the Business Combination, by Fathom OpCo, certain lenders, and JPMorgan Chase Bank, N.A., as administrative agent thereunder. New Fathom Units has the meaning given to the term Class A Units in the Fathom Operating Agreement. Newchem refers to NewChem, Inc. NYSE refers to the New York Stock Exchange. PIPE Investment means the private placement pursuant to which the PIPE Investors have made a private investment in the aggregate amount of $70,000,000 in public equity in the form of Class A common stock following the Domestication and immediately prior to the Closing on the terms and conditions set forth in the PIPE Subscription Agreements. An institutional investor that had committed to purchase an aggregate of 1,000,000 shares of Class A common stock for $10.00 per share to be included in the PIPE Investment defaulted under its subscription agreement, and failed to fund the $10,000,000 investment it had committed to make (See Legal Proceedings ). PIPE Investors refers to the investors that signed PIPE Subscription Agreements. PIPE Securities or PIPE Shares refers to the shares of Class A common stock sold to the PIPE Investors pursuant to the Subscription Agreements. PPC refers to Precision Process Corp. Prior Acquisitions means the acquisitions of FATHOM, ICOMold, Incodema, Newchem, GPI, Dahlquist, Majestic Metals and Mark Two completed in 2019 and 2020. Private Placement Warrants refers to the warrants acquired by the Sponsor in a private placement simultaneously with the closing of the Altimar II IPO (including ordinary shares issuable upon conversion thereof). Following the Business Combination, the shares issuable upon exercise of the Private Placement Warrants are shares of Fathom s Class A common stock. Table of Contents leading on-demand digital manufacturing platform purpose-built to serve the product development prototyping and low- to mid-volume production needs of the largest and most innovative companies, coupled with the following competitive strengths, will allow us to maintain and extend our market leading position. Adaptable, scalable platform with nationwide reach. Our platform is not reliant on any individual manufacturing technology, hardware provider, or materials supplier. Our agile business model allows us to respond to evolving customer needs through seamless integration of new manufacturing technologies, software capabilities, and materials. We have built a footprint of 12 manufacturing locations that enables us to produce and deliver parts to our customers nationwide, often in as a little as 24 hours. We expect to continue to benefit from continued innovation in additive and traditional manufacturing, and our established customer relationships which provide us differentiated insights into demand for new technologies, informing investments which expand our capabilities. Broad suite of manufacturing processes, deep technical expertise, and proprietary software platform. Our platform combines multiple manufacturing processes, dedicated engineering support, and purpose-built proprietary software to deliver a holistic solution which enhances efficiency for our customers. Our business is designed with the flexibility to accommodate complex designs and provide enterprise-grade, quick-turn manufacturing services for high-precision, high-quality parts at scale. Our broad set of manufacturing capabilities eliminates the need for customers to source parts across many single-process competitors or adhere to design constraints imposed by competing national manufacturing platforms and brokerages. This enables our customers to iterate designs faster and reduce time to market. Strong customer relationships across diverse end-markets. Our base of 3,000 active customers include many of the largest and most innovative companies in the world, spanning a diverse range of industries. Our strong value proposition is demonstrated through our 91% customer retention rate for the twelve months ended March 31, 2021, and our performance is not reliant on any single customer; in 2020, our largest customer comprised less than 6% of revenue. We have a differentiated ability to establish and cultivate revenue-generating relationships with multiple contacts across individual customers R&D and engineering organizations, leaving us increasingly entrenched as their on-demand manufacturing partner of choice. Highly experienced management team and Board of Directors. Our leadership team combines a deep additive and advanced manufacturing pedigree with decades of public market experience and a track record of scaling high-growth companies. We believe we have assembled a differentiated management team and Board of Directors who are particularly well-equipped to successfully lead our Company and achieve our strategic goals. Our Strategy for Growth Increased penetration of our existing enterprise-level corporate customer base and expansion through new enterprise-level corporate customers. Our focus has historically been on enterprise-level corporate customers with wide-ranging, complex research and development needs. Our value proposition resonates with these customers need for technology-agnostic, hands-on, quick-turn prototyping of low-to-mid volume, high-value parts. We believe we can continue to grow by maintaining our strategy of expanding relationships across departments within existing corporate customers, as well as building relationships with new corporate customers through our differentiated capabilities. Expanded offering of additive manufacturing capabilities. We provide comprehensive services that offer advanced technologies and processes tailored to our customer needs. To maintain our differentiated and market-leading suite of capabilities, we expect we will continue to integrate new Table of Contents Pro Forma Adjusted EBITDA a non-GAAP measure, means pro forma net loss before the impact of interest income or expense, income tax expense or benefit and depreciation and amortization, and further adjusted for the same items as Adjusted EBITDA. Proxy Statement/Prospectus refers to the proxy statement/prospectus of Altimar II filed with the Securities and Exchange Commission on December 3, 2021. Public Shares refers to: (i) prior to the consummation of the Business Combination, the Class A ordinary shares of Altimar II, par value $0.0001 per share, issued in the IPO and (Ii) after the consummation of the Business Combination, the Class A common stock of Fathom Digital Manufacturing Corporation, par value $0.0001 per share. Public Shareholders refers to the Public Shares or Public Warrants of Altimar II or Fathom Digital Manufacturing Corporation, as the context may require. Public Warrants refers to the warrants issued in the Altimar II IPO, entitling the holder thereof to purchase one of Altimar II s Class A ordinary shares at an exercise price of $11.50, subject to adjustment. Following the Business Combination, the shares issuable upon exercise of the Public Warrants are shares of Fathom s Class A common stock. Registration Rights Agreement refers to the Registration Rights Agreement, dated December 23, 2021, by and among Fathom and the other parties thereto, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms. SEC refers to the U.S. Securities and Exchange Commission. Securities Act refers to the Securities Act of 1933, as amended. Sponsor refers to Altimar Sponsor II, LLC, a Delaware limited liability company. Sponsor Earnout Shares means 1,267,500 shares of Class A common stock held by Sponsor (other than any shares of Fathom common stock issued to Sponsor pursuant to the PIPE Investment) that are unvested and restricted and that will vest automatically if (a) the VWAP of the Class A common stock equals or exceeds $12.50 per share for any twenty (20) trading days within a period of thirty (30) consecutive trading days and (b) there is a change of control of Fathom, unless the per share consideration to be received by the holders of Class A common stock in such change of control transaction is less than the vesting threshold applicable to the Sponsor Earnout Shares (each of (a) and (b), a Vesting Event ). To the extent that, on or prior to the fifth (5th) anniversary of the Closing Date, a Vesting Event does not occur, all outstanding unvested Sponsor Earnout Shares will automatically be forfeited. Subscription Agreements refers to the subscription agreements, dated as of July 15, 2021, by and among Altimar II, Fathom OpCo and the PIPE Investors, pursuant to which Altimar II agreed to issue an aggregate of 8,000,000 shares of Class A common stock to the PIPE Investors immediately following the Domestication and before the Closing at a purchase price of $10.00 per share. Summit refers to Summit Tooling, Inc., and Summit Plastics, LLC a Delaware corporation and limited liability company, collectively. Tax Receivable Agreement or TRA refers to the Tax Receivable Agreement, dated December 23, 2021, by and among Fathom, Fathom OpCo and the other parties thereto, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms. Transfer agent refers to Continental Stock Transfer & Trust Company. 2019 Acquisitions means the acquisitions of Fathom and ICOMold. 2020 Acquisitions means the acquisitions of Incodema, Dahlquist, Majestic Metals, Mark Two, Newchem and GPI completed in 2020. Table of Contents capabilities into our platform. We plan to make informed investments in new technologies, supported by our robust, ongoing dialogue with customers and deep industry expertise. Capitalizing on outsourcing trends in prototyping and low- to mid-volume manufacturing. It has become increasingly expensive and challenging for companies to maintain the materials, equipment, and skilled labor necessary to keep pace with the rate of innovation in today s market. Additionally, fluctuations in companies internal R&D cycles make it less efficient to build and fund a full suite of in-house capabilities. Based on current industry trends, we expect companies to further rely on outsourced providers for their prototyping and low- to mid-volume manufacturing. We believe we are well-positioned to capture market share as a result of this trend due to our comprehensive capabilities and corporate focus. Further enhancement of our software and digital capabilities. We are continuously working to expand our software platform s capabilities and believe this offering is pivotal in driving future growth. Our main areas of focus are: (i) further digitization of our offering through development of an internet-of-things enabled product suite, (ii) continued improvement of turnaround times and production efficiency achieved by leveraging our data analytics and artificial intelligence capabilities, (iii) enhancing the customer experience through greater integration of our platform into our customers PLM, MES and ERP systems, and (iv) reduction of our customers need for on-site inventory through the establishment of digitized supply chain management systems. Continued pursuit of strategic add-on acquisitions. Targeted acquisitions and integrations of complimentary digital manufacturing companies into our business represent an attractive growth opportunity, given our successful track record and the highly fragmented nature of our industry. Since 2019, we have completed 13 acquisitions (with four completed in 2021), transforming Fathom into a leading on-demand digital manufacturing company with a highly scalable breadth of manufacturing capabilities. We have optimized our platform to streamline the integration of new companies into the Fathom ecosystem, allowing us to deploy our proprietary playbook and realize synergies. Table of Contents 2021 Acquisitions means the acquisitions of Summit, Centex, Laser, Micropulse West and PPC completed in 2021. 2021 Term Loan means Fathom OpCo s $172 million term loan from JPMorgan Chase Bank, N.A., as lender and administrative agent, which was repaid in full at the Closing as part of the Business Combination. 2021 Omnibus Plan refers to the Fathom s 2021 Omnibus Incentive Plan, as the same may be amended, modified, supplemented or waived from time to time in accordance with its terms. Warrant Agent refers to Continental Stock Transfer & Trust Company. Warrant Agreement means that certain Warrant Agreement, dated as of February 4, 2021, by and between our predecessor entity, Altimar II, and Continental Stock Transfer & Trust Company. Warrants refers to the Public Warrants and the Private Placement Warrants. Many of the terms used in this prospectus, including Adjusted EBITDA and Pro Forma Adjusted EBITDA, may not be comparable to similarly titled measures used by other companies. Further, Adjusted EBITDA and Pro Forma Adjusted EBITDA are not measures of performance calculated in accordance with GAAP. We use Adjusted EBITDA and Pro Forma Adjusted EBITDA as measures of operating performance, not as measures of liquidity. They should not be considered in isolation or as substitutes for operating income, net income, operating cash flows or other income or cash flow statement data prepared in accordance with GAAP. The use of these measures without consideration of related GAAP measures is not adequate due to the adjustments described above. Our management compensates for these limitations by using non-GAAP measures as supplemental measures to our GAAP results. We present these measures to provide a more complete understanding of our performance as our management measures it. Amounts and percentages throughout this prospectus may reflect rounding adjustments and consequently totals may not appear to sum. For reconciliations of non-GAAP measures used by Fathom OpCo to Fathom OpCo s GAAP results, see Management s Discussion and Analysis of Financial Condition and Results of Operations Reconciliation of Consolidated GAAP Financial Measures to Certain Non-GAAP Measures . Table of Contents Organizational Structure The following diagram illustrates in simplified terms the structure and ownership of Fathom and its operating subsidiaries. 1. Altimar II Founders include Altimar Sponsor II, LLC and the seven former directors of Altimar II. 2. The warrants held by Public Shareholders are Public Warrants and the warrants held by Altimar Sponsor II, LLC are Private Placement Warrants. The organizational structure diagram assumes none of the Warrants have been exercised. The organizational structure diagram also excludes the Earnout Shares and the Sponsor Earnout Shares. 3. Legacy Fathom Owners include Fathom Blocker Owners and Continuing Fathom Unitholders, which include the CORE Investors. U.S. Federal Income Tax Considerations For a discussion summarizing the U.S. federal income tax considerations of an investment in shares of Class A common stock or Warrants, please see Certain U.S. Federal Income Tax Considerations. Table of Contents CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS Certain statements made in this prospectus are forward looking statements. Statements regarding our expectations regarding the business are forward looking statements. In addition, words such as estimates, projected, expects, estimated, anticipates, forecasts, plans, intends, believes, seeks, may, will, would, future, propose, target, goal, objective, outlook and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the control of the parties, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others, that may affect actual results or outcomes include: we are subject to risks related to the ongoing COVID-19 pandemic; we may be subject to cybersecurity risks and changes to data protection regulation; we face increasing competition in many aspects of our business; we may not realize the anticipated benefits of our business acquisitions, and any acquisition, strategic relationship, joint venture or investment could disrupt our business and harm our operating results and financial condition; if we are unable to manage our growth and expand our operations successfully, our reputation, brands, business and results of operations may be harmed; our success depends on our ability to deliver on-demand manufacturing capabilities and custom parts that meet the needs of our customers and to effectively respond to changes in our industry; our failure to meet our customers expectations regarding quick turnaround time, price or quality could adversely affect our business and results of operations; we are subject to risks related to our dependency on our key management members and other key personnel, as well as attracting, retaining and developing qualified personnel in a highly competitive talent market; we may be subject to litigation risks and may face liabilities and damage to our professional reputation as a result; our businesses are subject to extensive domestic and foreign regulations that may subject us to significant costs and compliance requirements; we are subject to risks related to the Tax Receivable Agreement; we may be subject to risks related to our status as an emerging growth company within the meaning of the Securities Act; we are subject to the risks of our status as a controlled company within the meaning of the NYSE listing standards; the grant of registration rights to certain of our investors and the future exercise of such rights may adversely affect the market price of our Class A common stock or Warrants; we have identified material weaknesses in our internal control over financial reporting. Failure to achieve and maintain effective internal control over financial reporting could result in our failure to accurately or timely report our financial condition or results of operations which could have a material adverse effect on our business and stock price; the effect of legal, tax and regulatory changes; and other factors detailed under the section entitled Risk Factors. Table of Contents Sources of Industry and Market Data Where information has been sourced from a third party, the source of such information has been identified. Unless otherwise indicated, the information contained in the prospectus on the market environment, market developments, market trends, and competition in the markets in which we operate is taken from publicly available sources, including third-party sources, or reflects our estimates that are principally based on information from publicly available sources. Some data are also based on good faith estimates, which are derived from internal company analyses or review of internal company reports as well as the independent sources referred to above. Although Fathom believes that the information on which it has based these estimates of industry position and industry data are generally reliable, the accuracy and completeness of this information is not guaranteed and it has not independently verified any of the data from third-party sources nor has it ascertained the underlying economic assumptions relied upon therein. Statements as to industry position are based on market data currently available. While Fathom is not aware of any misstatements regarding the industry data presented herein, these estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed under the heading Risk Factors in this prospectus. Risk Factors Summary You should consider carefully all of the risks described below, together with the other information contained in this prospectus, before making a decision to invest in our Class A common stock or Warrants. For purposes of the below summary of risk factors, we and our refers to Fathom or Fathom OpCo, as the context may require. Such risks include, but are not limited to: We are subject to risks related to the ongoing COVID-19 pandemic; We may be subject to cybersecurity risks and changes to data protection regulation; We face increasing competition in many aspects of our business; We may not realize the anticipated benefits of our business acquisitions, and any acquisition, strategic relationship, joint venture or investment could disrupt our business and harm our operating results and financial condition; If we are unable to manage our growth and expand our operations successfully, our reputation, brands, business and results of operations may be harmed; Our success depends on our ability to deliver on-demand manufacturing capabilities and custom parts that meet the needs of our customers and to effectively respond to changes in our industry; Our failure to meet our customers expectations regarding quick turnaround time, price or quality could adversely affect our business and results of operations; We are subject to risks related to our dependency on our key management members and other key personnel, as well as attracting, retaining and developing qualified personnel in a highly competitive talent market; Our Charter does not limit the ability of the CORE Investors and their affiliates to compete with us; Through their ownership of a majority of our common stock, negative control rights and their rights to nominate directors to our board under the Investor Rights Agreement, the CORE Investors have substantial influence over our management and policies; Table of Contents The forward-looking statements contained in this prospectus and in any document incorporated by reference herein are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described under the heading Risk Factors. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We may face additional risks and uncertainties that are not presently known to us, or that we deem to be immaterial, which may also impair our business, financial condition or prospects. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. Table of Contents We are subject to risks related to our dependency on Fathom OpCo to pay taxes, make payments under the Tax Receivable Agreement and pay other expenses; We may be subject to litigation risks and may face liabilities and damage to our professional reputation as a result; Our businesses are subject to extensive domestic and foreign regulations that may subject us to significant costs and compliance requirements; We are subject to risks related to the Tax Receivable Agreement; We may be subject to risks related to our status as an emerging growth company within the meaning of the Securities Act; The CORE Investors own more than 50% of Fathom s outstanding common stock, and as a result, we are subject to the risks related to Fathom being categorized as a controlled company within the meaning of the NYSE listing standards; Because the Company became a publicly traded company by means other than a traditional underwritten initial public offering, the Company s stockholders may face additional risks and uncertainties; Pre-existing relationships between participants in the Business Combination and the related transactions or their affiliates could give rise to actual or perceived conflicts of interest in connection with the Business Combination; The grant of registration rights to certain of our investors and the future exercise of such rights may adversely affect the market price of our Class A common stock or Warrants; We may amend the terms of the Warrants in a manner that may be adverse to holders of Public Warrants with the approval by the holders of at least 50% of the then outstanding Public Warrants. As a result, the exercise price of the Warrants could be increased, the exercise period could be shortened and the number of Class A common stock purchasable upon exercise of a Warrant could be decreased, all without approval of each Warrant affected; We have identified material weaknesses in our internal control over financial reporting. Failure to achieve and maintain effective internal control over financial reporting could result in our failure to accurately or timely report our financial condition or results of operations which could have a material adverse effect on our business and stock price; Our compliance obligations under the Sarbanes-Oxley Act require substantial financial and management resources, and increase the time and costs of completing an acquisition; and Our management team has limited experience managing a public company. Emerging Growth Company Section 102(b)(1) of the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ) exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a registration statement under the Securities Act declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. We have elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of Altimar II s financial statements Table of Contents with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. We will remain an emerging growth company until the earlier of: (1) (a) December 31, 2027, (b) the last day of the fiscal year in which we have total annual gross revenue of at least $1.07 billion, or (c) the last day of the fiscal year in which we are deemed to be a large accelerated filer, which means the market value of our common equity that is held by non-affiliates exceeds $700 million as of the end of the prior fiscal year s second fiscal quarter; and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company have the meaning associated with it in the JOBS Act. Smaller Reporting Company Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We expect to remain a smaller reporting company until the last day of the fiscal year in which (i) the market value of our common stock held by non-affiliates exceeds $250 million as of the prior June 30, or (ii) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as of the prior June 30. Corporate Information We are a Delaware corporation. Our principal executive office is located at 1050 Walnut Ridge Drive, Hartland, WI 53029. Our telephone number is (262) 367-8254. Our website is www.fathommfg.com. Information contained on our website is not a part of this prospectus, and the inclusion of our website address in this prospectus is an inactive textual reference only. Table of Contents
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all the information that you should consider in making your investment decision. Before investing in our common stock, you should read the entire prospectus carefully, including the sections entitled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations and our consolidated financial statements and the related notes. Unless context requires otherwise, references to we, us, our, Ocean, or the Company refer to Ocean Biomedical, Inc. and its subsidiaries. Our mission is to solve unmet medical needs by commercializing discoveries from research universities and medical centers We are a biopharmaceutical company that seeks to bridge the bench-to-bedside gap between medical research discoveries and patient solutions. We do this by leveraging our strong relationships with research universities and medical centers to license their inventions and technologies with the goal of developing them into products that address diseases with significant unmet medical needs. We believe that our differentiated business model positions us to capture inventions created at these institutions that might otherwise fail to be commercialized to benefit patients. Our team of accomplished scientists, business professionals and entrepreneurs brings together the interdisciplinary expertise and resources required to develop and commercialize a diverse portfolio of assets. We are organized around a licensing and subsidiary structure that we believe will enable us to create mutual value for us and potential licensing partners. We believe this structure, combined with the networks of our leadership team, allows us to opportunistically build a continuous pipeline of promising product innovations through our existing and potential future relationships with research institutions. Our goal is to optimize value creation for each of our product candidates, and we intend to continuously assess the best pathway for each as it progresses through the preclinical and clinical development process including through internal advancement, partnerships with established companies and spin-outs or initial public offerings, or IPOs in order to benefit patients through the commercialization of these products. Our current active assets are licensed directly or indirectly from Brown University, Stanford University and Rhode Island Hospital. Our scientific co-founders, Dr. Jack A. Elias and Dr. Jonathan Kurtis, are both affiliated with Brown University and with Rhode Island Hospital. Our Therapeutic Programs We are currently pursuing programs in oncology, fibrosis, infectious disease, and inflammation. Our programs in oncology and fibrosis are based on exclusive licenses with Brown University. Our programs in infectious disease are based on exclusive licenses with Rhode Island Hospital. Our program in inflammation is based on a nonexclusive license with Stanford University. We are not aware of any other licensee for these programs. We anticipate moving certain preclinical product candidates in our oncology, fibrosis and/or infectious disease programs into the clinic in the next 12 to 18 months. We also expect our anti-inflammatory product candidate, OPS-172 targeting angiotensin 1-7, or Ang 1-7, to commence Phase 1/2 clinical trials for the treatment of COVID-19 in the second half of 2022. Table of Contents Index to Financial Statements The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting offers to buy these securities in any state or other jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 8, 2022 PRELIMINARY PROSPECTUS 2,000,000 Shares Ocean Biomedical, Inc. Common Stock $ per share This is the initial public offering of our common stock. We are selling 2,000,000 shares of common stock. Prior to this offering there has been no public market for our shares. We currently expect the initial public offering price to be between $10.00 and $12.00 per share of common stock. We have granted the underwriters an option to purchase up to 300,000 additional shares of common stock. The underwriters can exercise this option at any time within 30 days after the date of this prospectus. We have applied to list our common stock on the Nasdaq Capital Market under the symbol OCEA. Investing in our common stock involves risks. See Risk Factors beginning on page 17. We are an emerging growth company as defined in the Jumpstart Our Business Act of 2012 and, as such, we have elected to comply with certain reduced reporting requirements for this prospectus and may elect to do so in future filings. Under current Nasdaq rules, we anticipate qualifying as a controlled company wherein at least 50% of the voting power of our company immediately following this initial public offering is anticipated to be held by Poseidon Bio, LLC, a Delaware limited liability company. Prior to this initial public offering and the Concurrent Private Placement (defined below), Poseidon Bio, LLC, or Poseidon, holds 98% of the voting power of our company, and Dr. Chirinjeev Kathuria, our executive chairman and co-founder, holds a majority share (69%) in Poseidon and other directors, executive officers, employees and consultants of our company own an aggregate of 31% of the equity interests in Poseidon. Following this initial public offering and the Concurrent Private Placement, Poseidon will hold 85% of the voting power of our company and Dr. Kathuria will continue to hold 69% of the equity interests in Poseidon and other directors, executive officers, employees and consultants of our company will own an aggregate of 31% of the equity interests in Poseidon. We do not intend to rely on any Nasdaq or Securities and Exchange Commission corporate governance exemptions that are available to controlled companies. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. Per Share Total Public Offering Price Underwriting Discounts and Commissions(1) Proceeds to Ocean Biomedical, Inc. (before expenses) (1) See Underwriting for additional information regarding total underwriter compensation. Underwriter compensation includes the issuance to the underwriters of warrants to purchase up to 6.75% of the aggregate number of shares of common stock sold in this offering, consisting of warrants to purchase up to 135,000 shares of common stock or 155,250 shares, if the underwriters exercise their option to purchase additional shares of common stock in this offering in full. The Regents of the University of California, as Trustee of the University of California Retirement Plan, or the UC Regents, has agreed to purchase a number of shares of our common stock equal to $7,000,000 at a price per share equal to 90% of the initial public offering price (or 707,070 shares based on the initial public offering price of $11.00 per share, which is the midpoint of the price range set forth on the cover page of this prospectus), in a private placement transaction that would close concurrently with, and be contingent and conditioned upon consummation of, this offering. The sale of such shares to the UC Regents will not be registered under the Securities Act of 1933, as amended, and these shares will be subject to certain restrictions on transfer pursuant to applicable securities laws and are subject to a 180-day lock-up agreement with the underwriters in this offering. The closing of this offering is not conditioned upon the closing of the proposed Concurrent Private Placement. The underwriters will not receive any fees in connection with the sale of shares to the UC Regents in the proposed Concurrent Private Placement. UC Regents has orally affirmed its intention to extend the expiration date of its stock purchase agreement until May 16, 2022. Poseidon, our controlling stockholder which is wholly owned by Dr. Chirinjeev Kathuria and certain of our other directors, executive officers, employees and consultants, has indicated an interest in purchasing shares of common stock being offered in this offering at the initial public offering price and on the same terms as the other shares being offered. Such indications of interest are not a binding agreement or commitment to purchase. We and the underwriters are currently under no obligation to sell any shares of common stock to Poseidon and they may determine to purchase more, fewer or no shares in this offering. The underwriters will receive the same underwriting discount on any shares purchased by these persons as they will on any other shares sold to the public in this offering. If Poseidon is allocated all or a portion of the shares it has indicated an interest in purchasing in this offering and purchases such shares, such purchase may reduce the available public float for our shares of common stock. As a result, any purchase of our shares of common stock by Poseidon in this offering may reduce the liquidity of our shares relative to what it would have been had these shares been purchased by other investors and thereby adversely impact the trading price of the shares. See Underwriting for more information. The underwriters expect to deliver the shares of common stock to purchasers on or about , 2022 through book-entry facilities of The Depository Trust Company. Joint Book-Running Managers Roth Capital Partners JonesTrading , 2022 Table of Contents Index to Financial Statements Oncology Non-small cell lung cancer: Non-small cell lung cancer, or NSCLC, accounts for about 85% of all lung cancers globally and affects approximately 460,000 people in the United States and 595,000 people in Europe. With approximately 135,000 U.S. deaths annually, it is the leading cause of cancer death for men and women globally. Currently available therapies for NSCLC include chemotherapy, targeted therapies and immune checkpoint inhibitors; all of which have limited response rates, high resistance development, potentially severe side effects and in the case of the checkpoint inhibitors rare fatal allergic and inflammation-related reactions. There is a significant unmet medical need for more effective and durable drug therapies. Glioblastoma multiforme: Glioblastoma multiforme, or GBM, is a brain cancer that kills approximately 60% of patients within 12 to 18 months from the time of diagnosis. It accounts for approximately 17% of all tumors of the brain and affects approximately 28,000 people in the United States. The median survival for individuals diagnosed with GBM is approximately 15 months and the five year survival rate is just 8% for those aged 45-54 and 5% for those aged 55-64. There is no currently approved therapy for GBM and it is a disease with one of the highest levels of unmet need in all of oncology. Our product candidates in oncology are based on a drug target pioneered by our scientific co-founder, Dr. Jack A. Elias, former Dean of Medicine and current Special Advisor for Health Affairs to Brown University. His research demonstrated that a protein called chitinase 3-like-1, or Chi3l1, is a key driver of multiple disease pathways, including those involved in primary and metastatic tumor development. Neutralizing antibodies against Chi3l1 have been developed that are highly avid, specific, react with mouse, human and monkey Chi3l1 and are effectively expressed and humanized. In animal models of both lung cancer and glioblastoma, inhibition of Chi3l1 resulted in statistically significant tumor reduction, and the reduction was even greater when the inhibition of Chi3l1 was combined with immunotherapies to stimulate the body s own immune response. Fibrosis Idiopathic pulmonary fibrosis: Idiopathic pulmonary fibrosis, or IPF, is a debilitating lung disease that occurs when the body s normal healing responses become overactive, resulting in scarring of lung tissue that progressively inhibits breathing. Approximately 160,000 people in the United States and 64,000 people in Europe suffer from IPF. There is no cure for IPF and while the current therapies may slow the progression of the disease, the response to those therapies is heterogenous and may be limited by side-effects. There is a significant unmet medical need for more effective and tolerable IPF therapies. Hermanksy-Pudlak syndrome: Hermansky-Pudlak syndrome, or HPS, is an ultra-rare disease affecting approximately 1,800 people in the United States, mostly in Puerto Rico. Most patients with HPS develop lung fibrosis that progresses rapidly and is typically lethal within ten years of diagnosis. No therapeutic interventions are currently approved by the FDA for the treatment of HPS and lung transplantation remains the only potentially life-prolonging treatment. There is a significant unmet need for any therapeutics that treat HPS. Our product candidate in fibrosis is based on a drug target also investigated by Dr. Elias and closely related to the Chi3l1 oncology target described above. Dr. Elias found that an enzyme called chitinase 1, or Chit1, is a key driver of fibrosis. Fibrosis is observed in an estimated 50% of all diseases. Fibrosis in the lungs tends to be progressive and can reduce their function. In animal models of IPF and HPS, inhibition of Chit1 showed statistically significant reduced levels of fibrotic markers. Infectious Disease Malaria: Approximately 500,000 children under the age of five globally die each year from malaria, a mosquito-borne infectious disease for which 3.4 billion people on earth are at risk. Malaria infects 200 to Table of Contents Index to Financial Statements TABLE OF CONTENTS Page Prospectus Summary 1
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+PROSPECTUS SUMMARY This is only a summary of the prospectus. While this summary contains material information about the Trust and its Shares, it does not contain or summarize all of the information about the Trust and the Shares contained in this prospectus, which is material and may be important to you. You should read this entire prospectus, including the section entitled Risk Factors, before making an investment decision about the Shares. Capitalized terms shall have the meaning set forth in this prospectus. See the Glossary attached to this prospectus as Exhibit A. Shares offered by the Trust The shares (the Shares ) issued by Sprott ESG Gold ETF (the Trust ) are offered continuously and will represent equal, fractional undivided beneficial interests in and ownership of the Trust's net assets. The Shares are expected to be listed on the NYSE Arca, Inc. (the Exchange ) and trade under the ticker symbol SESG . The Trust and the Trustee The Trust is an exchange-traded fund that was formed under the laws of the State of Delaware on February 10, 2021. The Trust operates pursuant to the Amended and Restated Trust Agreement (the Trust Agreement ) between Sprott Asset Management LP, a limited partnership formed under the laws of the Province of Ontario, Canada, pursuant to the Limited Partnerships Act (Ontario) by declaration dated September 17, 2008 (the Sponsor ), with offices in the United States and Canada, The Delaware Trust Company (the Trustee ) and the Trust. The Trustee s duties and liabilities are limited to its express obligations under the Trust Agreement. The Trustee has no duty or liability to supervise or monitor the performance of the Sponsor, nor does the Trustee have any liability for the acts or omissions of the Sponsor. Investment Objective of the Trust The investment objective of the Trust is for the Shares to closely reflect the performance of the price of gold, less the Trust s expenses and liabilities, through an investment in physical gold bullion that meets certain ESG criteria determined by the Sponsor and on a temporary basis in unallocated gold. Sprott ESG Approved Gold The assets of the Trust that are held by the Mint consist primarily of fully allocated unencumbered physical gold bullion that is that meets certain environmental, social and governance ( ESG ) standards and criteria established by the Sponsor ( Sprott ESG Approved Gold ). As described below, the Trust will also hold unallocated gold on a temporary basis, which will not qualify as Sprott ESG Approved Gold. Sprott ESG Approved Gold and unallocated gold are described in more detail below. Sprott ESG Approved Gold will be produced by the Mint specifically for the Trust using raw material that meets the criteria discussed below. Sprott ESG Approved Gold, as defined for purposes of the Trust, is not available in the general marketplace, although others, including other funds, may use the term ESG for gold used for their purposes. The term Sprott ESG Approved Gold refers to gold that is physically indistinguishable from other gold but that has been sourced and produced in a manner consistent with the standards and criteria that are established by the Sponsor (the ESG Criteria ), which are designed to provide investors with an enhanced level of ESG scrutiny along with disclosure of the provenance of the metal sourced, and include an evaluation of mining companies and mines. The ESG Criteria are anticipated to evolve over time at the discretion of the Sponsor. Also, one or more criterion may not be relevant with respect to all sources of gold that are eligible for investment. Factors that could be considered by the Sponsor in modifying the ESG Criteria include changes to current gold mining techniques or standards, evolving legal standards, the introduction of new standards or evaluation frameworks within the mining industry or the elimination of existing standards or frameworks that in the view of the Sponsor are relevant to the ESG assessment of a mining company or mine site. Mining companies and mines that meet the ESG Criteria ( Sprott ESG Approved Mining Companies and Sprott ESG Approved Mines , respectively) must also comply with the Mint Responsible Sourcing Requirements (the Mint Responsible Sourcing Requirements ). An overview of the Sponsor s application of the ESG Criteria to mining companies and mines that can provide the material for Sprott ESG Approved Gold is provided below. The application of the ESG Criteria involves multiple levels of analysis. While the Sponsor s evaluation of mines and mining companies will include the objective factors discussed in the Sprott ESG Approved Gold and Unallocated Gold section of this prospectus, the Sponsor will also evaluate factors that will require the subjective judgment of the Sponsor. The selection of these factors and how they are applied will be based, at least to some degree, on the judgment of the Sponsor and may or may not be consistent with current or future standards used by others in the industry. The ESG Criteria are subject to change by the Sponsor in its sole discretion. Any such changes will be reflected on the Trust s website promptly after any change to the ESG Criteria, Sprott ESG Approved Mines or Sprott ESG Approved Mining Companies has been made. The ESG Criteria are in addition to those used in the LBMA Responsible Sourcing Program, as detailed in the LBMA s Responsible Gold Guidance, and are designed to provide investors with an enhanced level of ESG scrutiny along with disclosure of the provenance of the metal sourced. The Mint currently requires that its refining customers, including mines, to meet the requirements outlined in the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas, the LBMA Responsible Gold Guidance, the Mint s Responsible Metals Program and the Mint s Anti-Money Laundering and Anti- Terrorist Financing Program in compliance with the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) (collectively, the Mint Responsible Sourcing Requirements ). The initial and ongoing screening of refining customers includes: Know Your Customer (KYC) verifications, detailed information on sourcing, including site visits in accordance with the Mint s risk assessment rating, review of human rights policies, anti-bribery and anti-corruption policies and controls, as well as screening on watch lists and through adverse media checks. Only mines which the Mint determines meet and maintain the Mint Responsible Sourcing Requirements and with whom the Mint has a contractual refining relationship (each a Mint Approved Mine , collectively the Mint Approved Mines ) will be eligible for consideration by the Sponsor as a provider of Sprott ESG Approved Gold. The Mint will cease refining gold from any Mint Approved Mine that no longer meets the Mint Responsible Sourcing Requirements, as determined by the Mint from time to time. The Mint Responsible Sourcing Requirements are subject to change by the Mint in its sole discretion. The ESG factors are a component of the ESG Criteria and are used for the ESG assessment of mines and miners, and generally will encompass numerous factors, including environmental criteria such as energy use and greenhouse gas emissions, tailings and waste management, conservation and water management and mine site remediation; social criteria such as worker safety and health, community relations, natural resource benefit to local communities, and avoidance of child and forced labor; and governance criteria such as corporate governance, workplace and gender diversity, fair executive compensation and corporate transparency and disclosures. Mining companies that qualify for the LBMA s Responsible Sourcing Program and are Mint Approved Mines will then be subject to two levels of ESG screening by the Sponsor: at the overall company level and at the individual mine site level. First, the Sponsor will evaluate a mining company that operates a Mint Approved Mine using ESG factors determined by the Sponsor (described below). This evaluation will use a number of tools, which include ratings from third-party research providers, such as Sustainalytics ESG Risk Ratings, along with sell-side equity research reports. With respect to corporate governance, the Sponsor will evaluate recommendations from proxy voting research providers, such as the Glass Lewis Proxy Review. The Sponsor will also use compliance with precious metals industry standards as an objective factor in its evaluation of such mining companies. Each such mining company with high ESG ratings and favorable recommendations from proxy voting research providers that complies with precious metals industry standards will be determined by the Sponsor to be a Sprott ESG Approved Mining Company. Second, the Sponsor will evaluate individual mine site locations of each Sprott ESG Approved Mining Company. Each mine location of a Sprott ESG Approved Mining Company will then be evaluated by the Sponsor as follows: (1) the performance of each mine against various indicators in the Mining Association of Canada s Towards Sustainable Mining standards; (2) using the ESG factors described above; and (3) whether such mine is in a heightened risk or conflict area. Heightened risk or conflict areas include areas where: human rights abuses, forced or child labor, war crimes or genocide are prevalent; mines are involved in direct or indirect support to non-state actors that use arms without legal authority; mines transport gold or supplies along routes that involve payment of illegal taxes or extortions; and mines are involved in money laundering or terrorism financing. Each mining location of that Sprott ESG Approved Mining Company that (a) the Sponsor determines to meet the Mining Association of Canada s Towards Sustainable Mining standards and the ESG factors, and (b) is not in a heightened risk or conflict area will be designated as a Sprott ESG Approved Mine. Only Sprott ESG Approved Mines will be permitted to supply the raw material for Sprott ESG Approved Gold to the Mint, which will then refine the raw material to create Sprott ESG Approved Gold for the Trust. This means that the provenance of Sprott ESG Approved Gold will be known to the Trust. Notwithstanding its special provenance, there is no separate market for gold from Sprott ESG Approved Mines. The Trust makes publicly available on its website (sprott.com/sesg) the ESG Criteria, a list of mines that meet the ESG Criteria ( Sprott ESG Approved Mines ) and a list of mining companies that meet the ESG Criteria ( Sprott ESG Approved Mining Companies ). As described above, the Trust anticipates that Sprott ESG Approved Mines and Sprott ESG Approved Mining Companies may be added or in some cases removed from such lists over time based on, among other things, whether such Sprott ESG Approved Mines and Sprott ESG Approved Mining Companies meet the evolving ESG Criteria and whether they continue to have a contractual relationship with the Mint. The Trust will update the relevant information on its website promptly after any change to the ESG Criteria, Sprott ESG Approved Mines or Sprott ESG Approved Mining Companies. (See Sprott ESG Approved Gold and Unallocated Gold for more information.) Initially, the Sponsor and the Mint will evaluate mining companies with operations located primarily in Canada and the United States, which are jurisdictions with high standards of governance, oversight and adherence to regulations, as potential sources for Sprott ESG Approved Gold. The Sponsor expects that, over time, mines in other jurisdictions may be evaluated as potential sources for Sprott ESG Approved Gold, provided that such mines can meet the ESG Criteria (which contain requirements that are in addition to the Mint Responsible Sourcing Requirements) and are not in jurisdictions deemed to be in a heightened risk or conflict area as determined by the Sponsor or the Mint. There is no industry standard for ESG factors that apply to gold production. The ESG Criteria and the processes and methods for producing and using Sprott ESG Approved Gold for the Trust s operations have been developed by the Sponsor specifically for the Trust; specifically, the Mint will segregate the dor , which is the term used for raw material created by mines that is used to refine gold, received from Sprott ESG Approved Mines from dor originating from non-Sprott ESG Approved Mines, and will segregate Sprott ESG Approved Gold from gold produced from dor originating from non-Sprott ESG Approved Mines. Sprott ESG Approved Gold will be produced by the Mint in special runs that will ensure that no gold from non-Sprott ESG Approved Mines will be included in the bars of Sprott ESG Approved Gold. No such special runs will take place until the launch of the Trust; therefore, there have been no market transactions in Sprott ESG Approved Gold. To ensure that its physical gold bullion will meet the ESG Criteria, the Trust will only accept gold bullion refined by the Mint after the launch date, which we expect to be immediately after the effectiveness of this prospectus. The Shares are intended to constitute a simple and cost-effective means of making an investment similar to an investment in gold bullion that meets the ESG Criteria. An investment in Sprott ESG Approved Gold requires expensive and sometimes complicated arrangements in connection with the assay, transportation, handling, storage and insurance of the metal as well as determining whether the gold meets the ESG Criteria. Such expense and complications have resulted in investments in Sprott ESG Approved Gold being efficient only in amounts beyond the reach of many investors, if they were available at all. The Shares have been designed to remove the obstacles represented by the expense and complications involved in an investment in Sprott ESG Approved Gold, while at the same time having an intrinsic value that reflects, at any given time, the price of the physical gold bullion owned by the Trust at such time, less the Trust s expenses and liabilities. Although the Shares are not the exact equivalent of an investment in gold, they provide investors with an alternative that allows a level of participation in the gold market through the securities market. Although there are additional costs associated with sourcing Sprott ESG Approved Gold that will be included in the Sponsor s fee, the value of the Sprott ESG Approved Gold will be determined by utilizing the LBMA Gold Price PM, which does not distinguish between gold that meets ESG Criteria and gold that does not. Compared to other gold products without similar ESG sourcing requirements, additional costs will be borne by the Sponsor and as a result the Sponsor s fee may be higher compared to other gold products without similar ESG sourcing requirements. For an illustration of how the Sponsor s fee may affect an investor s potential return on an investment, see the table under the heading Hypothetical Expense Example in The Sponsor section of the prospectus. Unallocated Gold The Trust s assets will also include unallocated physical gold bullion stored by the Mint in unallocated accounts on behalf of the Trust and cash. Unallocated gold is gold stored by or on behalf of the Mint in a pool on behalf of its customers; gold in that pool is not specifically designated as being held by a particular customer and shall mean, for purposes of the Trust, any gold that does not qualify as Sprott ESG Approved Gold. While there is no minimum amount of Sprott ESG Approved Gold that the Trust will hold, the Sponsor expects to exchange the Trust s holdings of unallocated physical gold into Sprott ESG Approved Gold as soon as reasonably practicable, to the extent that unallocated physical gold is not needed under the circumstances described below. The Trust will also, from time to time, on a temporary basis hold unallocated physical gold bullion under the following circumstances: (1) in connection with transfers of gold to settle creations and redemptions of Creation Units (as defined below); (2) until additional Sprott ESG Approved Gold can be refined by the Mint; (3) to the extent that the Trust holds gold in an amount less than a whole bar; and (4) in connection with payment of expenses of the Trust. Although the Trust intends to instruct the Mint to convert unallocated physical gold bullion to Sprott ESG Approved Gold as soon as reasonably practicable, there is no limit on the amount of unallocated physical gold bullion that the Trust can hold. The Mint s ability to convert unallocated physical gold bullion into Sprott ESG Approved Gold depends on various factors, including the size of the Trust s unallocated physical gold bullion holdings, the Trust s need for unallocated physical gold bullion to meet redemption requests, the availability of raw material for the Mint to produce additional Sprott ESG Approved Gold, the Mint s production capacity and certain minimum size requirements. The Shares are not a proxy for investing in gold. Assets of the Trust The Trust s assets are expected to consist primarily of Sprott ESG Approved Gold, unallocated physical gold bullion and cash. As described herein, the Trust will also hold unallocated gold on a temporary basis, particularly in connection with creations and redemptions. Such unallocated gold will not qualify as Sprott ESG Approved Gold. The Trust does not have a minimum amount of Sprott ESG Approved Gold that it is required to hold at any given time. Sprott ESG Approved Gold and unallocated gold are described in more detail in the Sprott ESG Approved Gold and Unallocated Gold section below. The Trust will not trade in gold futures, options or swap contracts on any futures exchange or over the counter ( OTC ). The Trust will not hold or trade in commodity futures contracts, commodity interests , or any other instruments regulated by the Commodity Exchange Act. The Trust s Cash Custodian may hold cash temporarily received from the sale of gold. The Trust s assets will only consist of Sprott ESG Approved Gold, unallocated gold and cash. The Mint will convert unallocated gold into Sprott ESG Approved Gold after receipt of a completed withdrawal request form from the Sponsor to withdraw an amount of unallocated gold from the Trust s unallocated gold account (the Trust Unallocated Account ) and deposit Sprott ESG Approved Gold into the Trust s allocated gold account (the Trust Allocated Account ). This deposit of Sprott ESG Approved Gold takes place once the applicable amount of Sprott ESG Approved Gold has been refined by the Mint, at which point the Mint will move the Sprott ESG Approved Gold to the Trust Allocated Account and debit the corresponding amount of gold from the Trust Unallocated Account. The Mint expects that the creation of new Sprott ESG Approved Gold bars would take about five Business Days after a request from the Sponsor on behalf of the Trust to convert unallocated gold into Sprott ESG Approved Gold, subject to availability, the Mint s production capacity and certain minimum size requirements. The Mint will exchange Sprott ESG Approved Gold for an equal amount of unallocated gold upon the receipt of proper instructions from the Sponsor on behalf of the Trust. In this process, the Mint will exchange Sprott ESG Approved Gold for an equal amount of unallocated gold by moving gold from the Trust Allocated Account and depositing an equal amount of unallocated gold into the Trust Unallocated Account. The Trust does not intend to hold a certain amount and maintains no minimum amount of gold in unallocated form to satisfy redemption requests or to pay expenses. All exchanges of unallocated gold to Sprott ESG Approved Gold and from Sprott ESG Approved Gold to unallocated gold are on a 1:1 basis, that is, each ounce of unallocated gold upon conversion will result in one ounce of gold content in the form of Sprott ESG Approved Gold, and vice versa. For purposes of such conversion, the Mint treats the content of gold contained in Sprott ESG Approved Gold as fully fungible with the gold the Mint holds on an unallocated basis, whether such unallocated gold originates from material sourced from Sprott ESG Approved Mines or elsewhere, given once the rough material is refined and fineness is taken into account, the resulting gold becomes interchangeable from the Mint's perspective. Bars that consist of Sprott ESG Approved Gold are not marked in any special way, nor do such bars have any special physical characteristics (aside from consisting only of Sprott ESG Approved Gold) and they are indistinguishable from other London Good Delivery bars. Once Sprott ESG Approved Gold bars leave the possession of the Trust, they will be treated as regular LBMA London Good Delivery bars by the Mint and comingled with other unallocated gold held by the Mint; therefore, Sprott ESG Approved Gold that is converted into unallocated gold will not remain available to meet future requests to convert unallocated gold to Sprott ESG Approved Gold. Because the Trust has to pay the Sponsor s fee on a monthly basis and may receive a redemption request on any given business day (days other than a Saturday, Sunday or holiday) ( Business Day ), the Trust expects to hold some amount of unallocated gold at any given point in time. The Trust s holdings of unallocated gold may be a significant percentage of the Trust s assets if, for example, the Trust has received more requests for creations than redemptions or the Trust s unallocated gold holdings are not sufficient to meet certain minimum size requirements to exchange unallocated gold to Sprott ESG Approved Gold at the Mint. There may be other times when the Trust s holdings of unallocated gold are a significant percentage of the Trust s assets, and there is no maximum percentage of the Trust s assets that may consist of unallocated gold. The Trust may need to instruct the Mint to exchange Sprott ESG Approved Gold into unallocated gold if insufficient unallocated gold is available to be sold to pay expenses or to meet redemption requests. In addition, the Trust may hold cash temporarily received from the sale of gold in its account with the Cash Custodian (as defined below) in connection with the payment of the Trust s fees and expenses. The Trust only invests in gold, but may have other assets on its balance sheet from time to time such as cash on a temporary basis or a receivable that is incidental to the operations of the Trust (for example, a receivable created as a result of a fee waiver from the Sponsor). The Sprott ESG Approved Gold owned by the Trust will be held by the Mint on behalf of the Trust on a fully-allocated basis in the Mint s own vault premises. Creations and Redemptions The Trust issues and redeems Creation Units on a continuous basis, but only in blocks of 50,000 Shares or multiples thereof in exchange for gold. A block of 50,000 Shares is called a Creation Unit . Only Authorized Participants (as defined below) may purchase or redeem Creation Units. The Mint will require each Authorized Participant to enter into a trading agreement with the Mint for the purpose of facilitating the transfers of unallocated gold between the Trust and the Authorized Participant. Creation Units are only issued or redeemed on a day that the Exchange is open for regular trading in exchange for an amount of gold determined by the Administrator. The Mint operates pursuant to the Royal Canadian Mint Act (Canada) and is a Canadian Crown corporation. The Mint is, for all its purposes, an agent of Her Majesty in right of Canada and, as such, its obligations constitute unconditional obligations of the Government of Canada. No Shares are issued unless the Trust has received the corresponding amount of unallocated gold in the Trust Unallocated Account at the Mint. The Trust will redeem Shares using unallocated gold. To the extent that the Trust s existing holdings of unallocated gold are insufficient to meet a redemption request, the Trust will be required to request that the Mint convert Sprott ESG Approved Gold to unallocated gold, which may result in delays in the Trust s ability to meet redemption requests from Authorized Participants. See the Exchange of Unallocated Gold to Sprott ESG Approved Gold and Sprott ESG Approved Gold to Unallocated Gold section for additional information, The amount of gold represented by each Share and the amount of gold necessary for the creation of a Creation Unit, or to be received upon redemption of a Creation Unit, will decrease over the life of the Trust, due to the payment or accrual of fees and other expenses or liabilities payable by the Trust. (See The Sponsor Hypothetical Expense Example for more information.) Creation Units may be created or redeemed only by Authorized Participants, who pay the Transfer Agent a transaction fee for each order to create or redeem Creation Units. Purchasing Individual Shares; Voting Rights Individual Shares may be purchased and sold only on the Exchange through brokers. Because the Shares will trade at market prices rather than net asset value ( NAV ), Shares may trade at prices greater than NAV (at a premium), at NAV, or less than NAV (at a discount). Retail investors may purchase and sell Shares through traditional brokerage accounts. Because the intrinsic value of each Share is a function of the price of only a fraction of an ounce of gold held by the Trust, the cash outlay necessary for an investment in Shares should be less than the amount required for currently existing means of investing in physical gold. Purchases or sales of Shares may be subject to brokerage commissions. Investors are encouraged to review the terms of their brokerage accounts for applicable charges. Shareholders will take no part in the management or control of the Trust and will have no voting rights with respect to the Trust, except as expressly provided for in the Trust Agreement. The Trust Agreement provides that Shareholders holding at least twenty-five percent (25%) of the outstanding Shares have the right to require the Sponsor to cure any material breach by it of the Trust Agreement and Shareholders holding at least fifty-one percent (51%) of the outstanding Shares must (i) consent to any material change to the Trust s investment objective and (ii) consent to any appointment of one or more successor sponsors. The Trust's NAV and the NAV per Share The Trust's NAV is determined on each Business Day by the Administrator as of 4:00 p.m. (New York City time) or as soon thereafter as practicable. The Trust's NAV shall be determined by the Administrator on a GAAP basis, and shall be equal to the sum of the values of the Sprott ESG Approved Gold and unallocated gold held by the Trust, less liabilities and expenses of the Trust. NAV per Share, which is calculated by the Administrator on each Business Day, is equal to the Trust's NAV divided by the number of outstanding Shares. In accordance with the Trust's valuation policy and procedures, the Administrator will determine the price of the Trust's Sprott ESG Approved Gold by reference to the LBMA Gold Price. This price will generally be based on the afternoon gold price as published by the London Bullion Market Association, which we will refer to as LBMA Gold Price PM. The Sponsor The Sponsor of the Trust is Sprott Asset Management LP. The Sponsor has offices in the United States and Canada. Authorized Participants Creation Units may be created or redeemed only by Authorized Participants. Each Authorized Participant must be a registered broker-dealer, a participant in The Depository Trust Company ( DTC ), have entered into an agreement with the Sponsor and the Trust (the Authorized Participant Agreement ) and, in connection with creations and redemptions of Creation Units, deliver or receive unallocated gold to or from the Trust, as applicable. The Authorized Participant Agreement provides the procedures for the creation and redemption of Creation Units and for the delivery of gold in connection with such creations or redemptions. A list of the current Authorized Participants can be obtained from the Transfer Agent or the Sponsor. Sponsor's Fee The Trust's only ordinary recurring expense is expected to be the Sponsor's fee. In exchange for the Sponsor s fee, which is paid by the Trust and thus the Shareholders, the Sponsor has agreed to assume the following ordinary administrative and other expenses of the Trust, which are the fees and expenses associated with the services provided by the Trustee (in its capacity as trustee of the Trust), the Administrator, the Cash Custodian, the Transfer Agent, the Adviser, Sprott Global Resource Investments Ltd. (the Marketing Agent ) and the Mint (in its capacity as custodian of the Trust s allocated and unallocated gold and refiner of Sprott ESG Approved Gold), any expenses charged by the Mint in connection with refining Sprott ESG Approved Gold, any costs associated with researching, establishing and maintaining the ESG Criteria and the diligence of the Sprott ESG Approved Gold held by the Trust (the Sprott ESG Approved Gold Holdings ), any costs associated with the transfer of gold to or from Authorized Participants in connection with creations and redemptions, the Exchange s listing fees, SEC registration fees, printing and mailing costs, audit fees and up to $100,000 per annum in legal fees and expenses. The Sponsor s fee is accrued daily and is paid monthly in arrears at an annualized rate equal to 0.38% of the Trust s daily NAV. The Sponsor s fee may be paid in cash or in kind in an amount of unallocated gold valued in the same way as the Trust s gold is valued for purposes of calculating the Trust s NAV. See Calculation of the Trust s NAV . The Sponsor may from time to time sell gold held by the Trust in such quantity as is necessary to permit payment of the Sponsor s fee and may also sell gold in such quantities as may be necessary to permit the payment of Trust expenses and liabilities not assumed by the Sponsor. The Sponsor is authorized to sell gold at such times and in the smallest amounts required to permit such payments as they become due, it being the intention to avoid or minimize the Trust s holdings of assets other than Sprott ESG Approved Gold. Accordingly, the amount of gold to be sold may vary from time to time depending on the level of the Trust s expenses and liabilities and the market price of gold. The Sponsor, from time to time, may waive all or a portion of the Sponsor s fee in its sole discretion, depending on operational considerations affecting the Trust or in response to market conditions. See The Sponsor The Sponsor s Fee for more details. The Trust will be responsible for fees and expenses that are not contractually assumed by the Sponsor, including but not limited to taxes and governmental charges, expenses related to extraordinary services performed by the Sponsor or other service provider of the Trust and litigation and indemnification obligations of the Trust. The Mint The Royal Canadian Mint will serve as the Trust's Gold Custodian pursuant to the allocated gold storage and custody agreement and the unallocated gold trading and custody agreement with the Sponsor and the Trust (respectively, the Allocated Gold Custody Agreement and Unallocated Gold Custody Agreement and collectively, the Gold Storage Agreements ). Under the Gold Storage Agreements, the Mint is responsible for the safekeeping the physical gold bullion owned by the Trust and supplying inventory information to the Trust and the Sponsor. The Mint will receive and hold physical gold bullion that is deposited for the account of the Trust. The Mint will release gold from the Trust s unallocated gold account (the Trust Unallocated Account ) or allocated gold account (the Trust Allocated Account ) (collectively, the Gold Accounts ) when instructed in writing by the Sponsor, not otherwise. The Mint will safely store the Trust s Sprott ESG Approved Gold in its own vaulting facilities or such other locations where the Mint may maintain vaulting facilities from time to time. Cash Custodian The Bank of New York Mellon will serve as the Trust s cash custodian (the Cash Custodian ) pursuant to the terms of the agreement between the Trust and the Cash Custodian (the Cash Custody Agreement ). In its capacity as cash custodian, the Cash Custodian will maintain a custodial account that holds Cash for the benefit of the Trust for the purpose of payment of the Sponsor s fee in cash or the other expenses of the Trust. Administrator and Transfer Agent The Bank of New York Mellon serves as the Trust s administrator (the Administrator ) and transfer agent (the Transfer Agent ). The Adviser Sprott Asset Management USA Inc. serves as the Trust s investment adviser (the Adviser ). The Adviser is the investment adviser for the Trust and has discretionary authority to make all determinations with respect to the Trust s assets, subject to specified limitations. The Adviser has been registered as an investment adviser with the SEC since 2006. Fees to the Adviser are paid by the Sponsor. Please see The Adviser and Description of the Trust Documents Description of the Advisory Agreement for more details. The Adviser may also act, currently or in the future, as the adviser for certain other investment vehicles. The Advisory Agreement may be terminated at any time, without the payment of any penalty, by any party on sixty (60) days written notice to the other parties. The Adviser Sprott Asset Management USA Inc. serves as the Trust s investment adviser (the Adviser ). The Adviser is the investment adviser for the Trust and has discretionary authority to make all determinations with respect to the Trust s assets, subject to specified limitations. The Adviser has been registered as an investment adviser with the SEC since 2006. Fees to the Adviser are paid by the Sponsor. Please see The Adviser and Description of the Trust Documents Description of the Advisory Agreement for more details. The Adviser may also act, currently or in the future, as the adviser for certain other investment vehicles. The Advisory Agreement may be terminated at any time, without the payment of any penalty, by any party on sixty (60) days written notice to the other parties.
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+PROSPECTUS SUMMARY 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to we, us, company or our company are to Apollo Strategic Growth Capital III, a Cayman Islands exempted company, incorporated with limited liability, and references to: amended and restated memorandum and articles of association are to our amended and restated memorandum and articles of association to be in effect upon completion of this offering; Apollo are to Apollo Global Management, Inc. (NYSE: APO), a Delaware corporation, and its consolidated subsidiaries; Apollo Funds are to the private equity, credit and real assets funds (including parallel funds and alternative investment vehicles), partnerships, accounts (including strategic investment accounts), alternative asset companies and other entities for which Apollo provides investment management or advisory services; assets under management or AUM are to the assets of the funds, partnerships and accounts to which Apollo provides investment management, advisory, or certain other investment-related services, including, without limitation, capital that such funds, partnerships and accounts have the right to call from investors pursuant to capital commitments; Apollo s AUM equals the sum of: (i) the net asset value plus used or available leverage and/or capital commitments, or gross assets plus capital commitments, of the credit funds, partnerships and accounts for which Apollo provides investment management or advisory services, other than certain collateralized loan obligations, collateralized debt obligations, and certain permanent capital vehicles, which have a fee-generating basis other than the mark-to-market value of the underlying assets; (ii) the fair value of the investments of the private equity and real assets funds, partnerships and accounts Apollo manages or advises plus the capital that such funds, partnerships and accounts are entitled to call from investors pursuant to capital commitments, plus portfolio level financings; for certain permanent capital vehicles in real assets, gross asset value plus available financing capacity; (iii) the gross asset value associated with the reinsurance investments of the portfolio company assets Apollo manages or advises; and (iv) the fair value of any other assets that Apollo manages or advises for the funds, partnerships and accounts to which Apollo provides investment management, advisory, or certain other investment-related services, plus unused credit facilities, including capital commitments to such funds, partnerships and accounts for investments that may require pre-qualification or other conditions before investment plus any other capital commitments to such funds, partnerships and accounts available for investment that are not otherwise included in the clauses above. Apollo s AUM measure includes assets under management for which it charges either nominal or zero fees. Apollo s AUM measure also includes assets for which Apollo does not have investment discretion, including certain assets for which Apollo earns only investment-related service fees, rather than management or advisory fees. Apollo s definition of AUM is not based on any definition of assets under management contained in its governing documents or in any of the Apollo fund management agreements. Apollo considers multiple factors for determining what should be included in its definition of AUM. Such factors include but are not limited to (1) its ability to influence the investment decisions for existing and available assets; (2) its ability to generate income from the underlying assets in the Apollo Funds; and (3) the AUM measures that Apollo uses internally or believe are used by other investment managers. Given the differences in the investment strategies and structures among other alternative investment managers, Apollo s calculation of AUM may differ from the calculations employed by other investment managers and, as a result, this measure may not be directly comparable to similar measures presented by other investment managers. Apollo s calculation also differs from the manner in which its affiliates registered with the SEC report Regulatory Assets Under Management on Form ADV and Form PF in various ways; Companies Act are to the Companies Act (as amended) of the Cayman Islands as the same may be amended from time to time; TABLE OF CONTENTS Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. CALCULATION OF REGISTRATION FEE Title of Each Class of Security Being Registered Amount Being Registered Proposed Maximum Offering Price per Security(1) Proposed Maximum Aggregate Offering Price(1) Amount of Registration Fee Units, each consisting of one Class A ordinary share, $0.0001 par value, and one-third of one public warrant (2) 40,250,000 Units $10.00 $402,500,000 $37,312(5) Class A ordinary shares included as part of the units (3) 40,250,000 Shares (4) Warrants included as part of the units(3) 13,416,667 Warrants (4) Total $402,500,000 $37,312(5) (1) Estimated solely for the purpose of calculating the registration fee. (2) Includes 5,250,000 units, consisting of 5,250,000 Class A ordinary shares and 1,750,000 public warrants, which may be issued upon exercise of a 30-day option granted to the underwriters to cover over-allotments, if any. (3) Pursuant to Rule 416(a), there are also being registered an indeterminable number of additional securities as may be issued to prevent dilution resulting from share splits, share dividends or similar transactions. (4) No fee pursuant to Rule 457(g). (5) Previously paid in connection with the previous filing of this registration statement on March 29, 2021. The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. TABLE OF CONTENTS completion window are to the period following the closing of this offering at the end of which, if we have not completed our initial business combination, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (net of permitted withdrawals and up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions and as further described herein; the completion window ends 21 months from the closing of this offering, or 24 months from the closing of this offering if we extend the period of time to consummate a business combination; equity-linked securities are to any securities of our company or any of our subsidiaries which are convertible into, or exchangeable or exercisable for, equity securities of our company or such subsidiary, including any securities issued by our company or any of our subsidiaries which are pledged to secure any obligation of any holder to purchase equity securities of our company or any of our subsidiaries; founder shares are to our Class B ordinary shares held by our sponsor and our Class A ordinary shares issued upon the automatic conversion thereof at the time of completion of our initial business combination as described herein; initial shareholders are to holders of our founder shares prior to this offering; management or our management team are to our officers and directors; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares, collectively; permitted withdrawals are to amounts withdrawn to pay our taxes; private placement warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering; public shares are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders are to the holders of our public shares, including our initial shareholders and management team to the extent our initial shareholders and/or members of our management team purchase public shares, provided that each initial shareholder s and member of our management team s status as a public shareholder shall only exist with respect to such public shares; public warrants are to the warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); sponsor are to APSG Sponsor III, L.P., a Cayman Islands exempted limited partnership and an affiliate of Apollo; and warrants are to our private placement warrants, public warrants and any warrants we issue to our sponsor upon conversion of loans. All references in this prospectus to shares of the company being forfeited shall take effect as surrenders for no consideration of such shares as a matter of Cayman Islands law. All references to the conversion of our Class B ordinary shares shall take effect as a redemption of such Class B ordinary shares and issuance of the corresponding Class A ordinary shares as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Each unit consists of one Class A ordinary share and one-third of one public warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as described in this prospectus, and only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least three units, you will not be able to receive or trade a whole warrant. Registered trademarks referred to in this prospectus are the property of their respective owners. Unless otherwise indicated, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. TABLE OF CONTENTS The information contained in this prospectus is not complete and may be changed. No securities may be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities, and it is not soliciting an offer to buy these securities, in any jurisdiction where the offer or sale is not permitted. Subject to Completion, dated January 11, 2022 PRELIMINARY PROSPECTUS $350,000,000 Apollo Strategic Growth Capital III 35,000,000 Units Apollo Strategic Growth Capital III is a blank check company incorporated as a Cayman Islands exempted company and incorporated with limited liability, and formed for the purpose of effecting a merger, consolidation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. We may pursue an initial business combination target in any business or industry. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share and one-third of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as described in this prospectus, and only whole warrants are exercisable. The warrants will become exercisable on the later of 30 days after the completion of our initial business combination and 12 months from the closing of this offering, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We refer to these warrants throughout this prospectus as the public warrants. We have also granted the underwriters a 30-day option to purchase up to an additional 5,250,000 units to cover over-allotments, if any. We will provide our shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares in connection with our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes ( permitted withdrawals ), divided by the number of then outstanding Class A ordinary shares that were sold as part of the units in this offering, which we refer to collectively as our public shares, subject to the limitations described herein. If we are unable to complete our initial business combination within 21 months from the closing of this offering, or up to 24 months from the closing of this offering if we extend the period of time to consummate an initial business combination (the completion window ), we will redeem 100% of the public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to make permitted withdrawals (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and as further described herein. Our sponsor, APSG Sponsor III, L.P. (which we refer to as our sponsor throughout this prospectus), has committed to purchase an aggregate of 6,107,500 warrants (or 6,807,000 warrants if the over-allotment option is exercised in full) at a price of $1.50 per warrant ($9.16 million in the aggregate, or $10.21 million if the over-allotment option is exercised in full) in a private placement that will close simultaneously with the closing of this offering. We refer to these warrants throughout this prospectus as the private placement warrants. Each private placement warrant is exercisable to purchase one Class A ordinary share at $11.50 per share. Our initial shareholders, which include our sponsor, currently own an aggregate of 10,062,500 Class B ordinary shares (up to 1,312,500 shares of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised). We refer to these Class B ordinary shares as the founder shares throughout this prospectus. The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of completion of our initial business combination on a one-for-one basis, subject to adjustment as provided herein. Holders of the Class B ordinary shares will have the right to vote on the election or removal of our directors prior to our initial business combination and each director will need to receive the vote of two-thirds of the outstanding Class B ordinary shares in order to be elected. On any other matter submitted to a vote of our shareholders, holders of the Class B ordinary shares and holders of the Class A ordinary shares will vote together as a single class, except that in respect of any vote or votes to continue the company in a jurisdiction outside the Cayman Islands (including, but not limited to, the approval of the organizational documents of the company in such other jurisdiction), holders of Class B ordinary shares will have ten votes per share and holders of Class A ordinary shares will have one vote per share, and except as required by law or the applicable rules of the New York Stock Exchange, or the NYSE, then in effect. TABLE OF CONTENTS Our Company Apollo Strategic Growth Capital III is a Cayman Islands incorporated and exempted blank check company formed for the purpose of effecting a merger, consolidation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. To date, our efforts have been limited to organizational activities as well as activities related to this offering. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. Apollo Strategic Growth Capital III is an affiliate of Apollo. Founded in 1990, Apollo is a high-growth global alternative asset manager with asset management and retirement services capabilities with approximately $481 billion of assets under management as of September 30, 2021. In its asset management business, Apollo seeks to provide its clients excess return at every point along the risk-reward spectrum from investment grade to private equity with a focus on three business strategies: yield, hybrid and opportunistic. Apollo s integrated asset management model with no information barriers provides Apollo investment professionals with differentiated industry and market insights, as each investment business line draws upon the intellectual capital and experience from others, which Apollo believes is a significant competitive advantage and is distinct from other alternative asset managers. The Apollo team consists of employees across offices in New York, Los Angeles, San Diego, Houston, Bethesda, London, Frankfurt, Madrid, Luxembourg, Mumbai, Delhi, Singapore, Hong Kong, Shanghai and Tokyo, among other locations throughout the world (as of September 30, 2021). Apollo s private equity segment (approximately $86.1 billion of assets under management as of September 30, 2021) manages funds that focus on corporate private equity and provide capital solutions across industries and geographies. Apollo s flagship private equity funds pursue a value-oriented, contrarian approach, investing across the capital structure with a focus on three primary pathways to capture value: opportunistic buyouts, corporate carve-outs and distressed-for-control investments. Since inception, Apollo s flagship private equity funds have invested more than $71 billion of fund capital across over 180 portfolio companies, representing more than $320 billion of enterprise value in the aggregate. Apollo s flagship private equity funds have consistently produced attractive returns, having generated a gross IRR of 39% (24% net IRR)1. Apollo s credit segment (approximately $340.9 billion of assets under management as of September 30, 2021) is debt-focused and primarily deploys capital across corporate credit and structured credit in non-control scenarios; it also directly lends and originates loans on a global basis in large, established corporations. 1 Represents returns of traditional Apollo private equity funds since inception in 1990 through September 30, 2021. Past performance is not indicative of future results. Gross IRR represents the cumulative investment-related cash flows (i) for a given investment for the fund or funds which made such investment, and (ii) for a given fund, in the relevant fund itself (and not any one investor in the fund), in each case, on the basis of the actual timing of investment inflows and outflows (for unrealized investments assuming disposition on September 30, 2021 or other date specified) aggregated on a gross basis quarterly, and the return is annualized and compounded before management fees, performance fees and certain other expenses (including interest incurred by the fund itself) and measures the returns on the fund s investments as a whole without regard to whether all of the returns would, if distributed, be payable to the fund s investors. In addition, gross IRRs at the fund level will differ from those at the individual investor level as a result of, among other factors, timing of investor-level inflows and outflows. Gross IRR does not represent the return to any fund investor. Net IRR means the Gross IRR applicable to a fund, including returns for related parties which may not pay fees or performance fees, net of management fees, certain expenses (including interest incurred or earned by the fund itself) and realized performance fees all offset to the extent of interest income, and measures returns at the fund level on amounts that, if distributed, would be paid to investors of the fund. The timing of cash flows applicable to investments, management fees and certain expenses, may be adjusted for the usage of a fund s subscription facility. To the extent that a fund exceeds all requirements detailed within the applicable fund agreement, the estimated unrealized value is adjusted such that a percentage of up to 20.0% of the unrealized gain is allocated to the general partner of such fund, thereby reducing the balance attributable to fund investors. In addition, net IRR at the fund level will TABLE OF CONTENTS Prior to this offering there has been no public market for our units, Class A ordinary shares or public warrants. We intend to apply to have our units listed on the NYSE under the symbol APGC.U. We cannot guarantee that our securities will be approved for listing on NYSE. We expect the Class A ordinary shares and public warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless the representative of the underwriters, or representative, informs us of its decision to allow earlier separate trading, subject to our filing a Current Report on Form 8-K with the U.S. Securities and Exchange Commission, or the SEC, containing an audited balance sheet reflecting our receipt of the gross proceeds of this offering and issuing a press release announcing when such separate trading will begin. Once the securities comprising the units begin separate trading, we expect that the Class A ordinary shares and public warrants will be listed on the NYSE under the symbols APGC and APGC WS, respectively. We are an emerging growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 35 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. No offer or invitation to subscribe for units may be made to the public in the Cayman Islands. Per Unit Total Public offering price $ 10.00 $ 350,000,000 Underwriting discounts and commissions(1) $ 0.55 $ 19,250,000 Proceeds, before expenses, to Apollo Strategic Growth Capital III $ 9.45 $ 330,750,000 (1) Includes $0.35 per unit, or $12,250,000 in the aggregate (or $14,087,500 in the aggregate if the underwriters over-allotment option is exercised in full), payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein and released to the underwriters only upon the completion of our initial business combination, as described in this prospectus. See Underwriting (Conflict of Interest) elsewhere in this prospectus for a description of compensation and other items of value payable to the underwriters. Of the $359.2 million in proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, or $412.7 million if the underwriters over-allotment option is exercised in full, $350.0 million ($10.00 per unit), or $402.5 million if the underwriters over-allotment option is exercised in full ($10.00 per unit), will be deposited into a U.S.-based trust account at J.P. Morgan Chase Bank, N.A.with Continental Stock Transfer & Trust Company acting as trustee, and $9.2 million, including $7.0 million in underwriting discounts and commissions (or $10.2 million, including $8.1 million in underwriting discounts and commissions, if the underwriters over-allotment option is exercised in full), will be used to pay fees and expenses in connection with the closing of this offering and for working capital following the closing of this offering. Except with respect to interest earned on the funds held in the trust account that may be released to us to make permitted withdrawals, the proceeds from this offering and the sale of the private placement warrants held in the trust account will not be released from the trust account until the earliest of (a) the completion of our initial business combination (including the release of funds to pay any amounts due to any public shareholders who properly exercise their redemption rights in connection therewith), (b) the redemption of any public shares properly submitted in connection with a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association that would affect the substance or timing of our obligation to redeem 100% of our public shares if we have not consummated an initial business combination within the completion window or with respect to any other material provisions relating to shareholders rights or pre-initial business combination activity, and (c) the redemption of our public shares if we are unable to complete our initial business combination within the completion window, subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2022. Credit Suisse Apollo Global SecuritiesBofA SecuritiesGoldman Sachs & Co. LLCRBC Capital Markets Siebert Williams Shank American Veterans Group The date of this prospectus is , 2022. TABLE OF CONTENTS Apollo s real assets segment (approximately $54.1 billion of assets under management as of September 30, 2021) primarily invests in assets across hospitality, office, industrial, retail, healthcare, residential and non-performing loans in the United States, Europe and Asia. Apollo has a long history of extending its platform outside of its existing investment funds to diversify into areas with meaningful synergy with its core businesses. Apollo Strategic Growth Capital III further broadens Apollo s investment mandate, allowing the platform to pursue new opportunities that leverages Apollo s significant experience in building and accelerating growth in businesses across diverse industries. Apollo Strategic Growth Capital III will seek to invest in more growth-oriented businesses that stand to benefit from being public in the acceleration of their value-creation strategies. We believe Apollo Strategic Growth Capital III will come across a considerable number of potential investment opportunities sourced through our management team s network of existing relationships and through existing deal flow within Apollo s infrastructure. As an extension of Apollo s integrated platform, Apollo Strategic Growth Capital III will benefit from Apollo s diverse investment experience. We believe the association with the Apollo platform will enable Apollo Strategic Growth Capital III to (i) source a greater number and a more differentiated set of business combination opportunities, (ii) utilize Apollo s pre-existing executive relationships and institutional knowledge in due diligence, (iii) more successfully implement value creation strategies and initiatives to accelerate growth following a business combination, and (iv) better optimize our capital structure and more easily raise any required incremental capital to support any potential go-forward needs following a business combination. Apollo Strategic Growth Capital III is supported by the Apollo platform, which provides us with proprietary access to a robust pipeline of deal opportunities that differentiates us from other special purpose acquisition companies currently in market. We believe that Apollo Strategic Growth Capital ( APSG I ), a special purpose acquisition company sponsored by an affiliate of Apollo that completed its initial public offering on October 6, 2020, and Apollo Strategic Growth Capital ( APSG II ), a special purpose acquisition company sponsored by an affiliate of Apollo that completed its initial public offering on February 9, 2021, have provided examples of how valuable an affiliation with Apollo can be in providing deal opportunities and introductions to industry-leading companies and management teams at key inflection points in their life-cycles. We believe that the Apollo platform has historically been a unique and valuable source of deal flow, and since the pricing of APSG I and APSG II there has been a further increase in outreach from companies looking to partner with Apollo through a special purpose acquisition company, broadening our potential deal pipeline. Since its initial public offering in October 2020, the Apollo platform has identified a substantial number of potential opportunities for APSG I, which has resulted in APSG I engaging in advanced discussions with a number of potential targets. In December 2021, APSG I entered into a definitive agreement for its initial business combination with American Express Global Business Travel, the world s leading B2B travel platform. Since its initial public offering in February 2021, the Apollo platform has also identified a substantial number of potential opportunities for APSG II, which has resulted in APSG II engaging in advanced discussions with a number of potential targets. APSG II has not yet announced an initial business combination. We believe that Apollo Strategic Growth Capital III will benefit from the prior work of the Apollo deal sourcing platform and the experience gained in connection with APSG I and APSG II, and, given the sizing of Apollo Strategic Growth Capital III and the additional opportunity we provide, we believe that we are well-positioned to pursue certain actionable transactions within the existing pipeline, including transactions that APSG II is unable to or otherwise does not pursue. Through these processes, our management team has gained invaluable experience and knowledge regarding successfully sourcing, identifying, negotiating and executing special purpose acquisition company transactions. We believe that this combination of an established deal sourcing infrastructure and potential deal pipeline, together with the experience of our management team, will allow Apollo Strategic Growth Capital III to pursue opportunities immediately following the closing of this offering. Sanjay Patel serves as our Chief Executive Officer and Executive Chairman. Mr. Patel has over 35 years of investment and transactional experience in private equity and is currently Chairman International and Senior Partner of Private Equity at Apollo, with responsibility for helping to build and develop differ from that at the individual investor level as a result of, among other factors, timing of investor-level inflows and outflows. Net IRR does not represent the return to any fund investor. TABLE OF CONTENTS Apollo s international businesses. Mr. Patel was formerly Head of Europe and managing partner of Apollo European Principal Finance. Mr. Patel joined Apollo in 2010 as Head of International Private Equity; prior to this, he was a partner at Goldman, Sachs & Co., where he was co-head of European and Indian Private Equity for the Principal Investment Area (PIA) and previously also served as President of Greenwich Street Capital. Mr. Patel currently serves on the board of directors of Tegra Apparel. Mr. Patel is also the Chief Executive Officer and a member of the board of directors of APSG I and APSG II. APSG I completed its initial public offering in October 2020, in which it sold 75,000,000 units, each consisting of one Class A ordinary share and one-third of one warrant, with each whole warrant entitling the holder thereof to purchase one Class A ordinary share, for an offering price of $10.00 per unit, generating gross proceeds of approximately $750 million. On November 10, 2020, APSG I consummated the sale of an additional 6,681,000 units pursuant to the underwriters partial exercise of their over-allotment option at a price of $10.00 per unit, generating gross proceeds of approximately $66.8 million. In December 2021, APSG I entered into a definitive agreement for its initial business combination with American Express Global Business Travel, the world s leading B2B travel platform. Mr. Patel and Mr. Crossen serve as the Chief Executive Officer and Chief Financial Officer of APSG I, respectively, and Mr. Patel serves as a member of APSG I s board of directors. APSG II completed its initial public offering in February 2021, in which it sold 69,000,000 units, each consisting of one Class A ordinary share and one-fifth of one warrant, with each whole warrant entitling the holder thereof to purchase one Class A ordinary share, for an offering price of $10.00 per unit, generating gross proceeds of approximately $690 million, including the underwriters full exercise of their over-allotment option. Mr. Patel and Mr. Crossen serve as the Chief Executive Officer and Chief Financial Officer of APSG II, respectively, and Mr. Patel serves as a member of APSG II s board of directors. We believe that we will benefit from the valuable experience gained by our management team during the launch and operation of APSG I and APSG II, including the process of evaluating numerous target companies and industry sectors. With respect to the foregoing examples, past performance of Apollo, the Apollo Funds, Spartan Energy Acquisition Corp. ( Spartan I ), Spartan Acquisition Corp. II ( Spartan II ), Spartan Acquisition Corp. III ( Spartan III ), Spartan Acquisition Corp. IV ( Spartan IV ), Acropolis Infrastructure Acquisition Corp. ( Acropolis ), Delphi Growth Capital Corp. ( Delphi ), APSG I and APSG II is not a guarantee either (i) that we will be able to identify a suitable candidate for our initial business combination or (ii) of success with respect to any business combination we may consummate. You should not rely on the historical record of Apollo s, the Apollo Funds or our management s performance as indicative of our future performance. An investment in us is not an investment in the Apollo Funds. Business Strategy Our acquisition and value creation strategy is to identify, acquire and, after our initial business combination, further accelerate the growth of a company in the public markets. Our team has a history of executing transactions in multiple geographies and under varying economic and financial market conditions. Although we may pursue an acquisition in a number of industries or geographies, we intend to capitalize on the ability of our management team and the broader Apollo platform where we believe a combination of our relationships, knowledge and experience across industries can effect a positive transformation or augmentation of an existing business. Specifically, we believe the following characteristics can help us identify an opportunity and allow for a successful transaction: Apollo s Proprietary Sourcing Engine: We believe Apollo s integrated platform and its established network of relationships have been critical to generating differentiated and proprietary investment ideas, allowing Apollo to successfully deploy capital across various asset classes and market environments. Apollo has a bench of more than 600 investment professionals across North America, Europe, and Asia, with broad industry coverage. We believe management teams seek to work with Apollo s private equity business because of its ability to quickly understand business models, structure flexible solutions and offer operational expertise; over 60% of Apollo s private equity investments TABLE OF CONTENTS since inception have been proprietary in nature. Likewise, we believe Apollo s credit business is recognized as a preferred capital provider due to its ability to move quickly and provide large commitments with high certainty. We believe a considerable number of potential investment opportunities that would fit our mandate are already being sourced through the Apollo platform, but currently lack a natural home within the infrastructure. Opportunity to Accelerate and Support Growth: Apollo has significant experience accelerating and investing behind growth as a core value creation lever. This approach has come in numerous forms: investing in the incubation of a new technology (Hughes Telematics); building and launching a new platform (Sirius Satellite Radio); acquiring a high-growth target through an existing portfolio company (Playtika); seeding upfront costs to expand a company into a new business line (National Cinemedia); accelerating high-ROI investments in a portfolio company (ecoATM); materially expanding an existing platform and footprint (Sprouts Farmers Market); completing large-scale acquisitions to drive consolidation (Unitymedia); and repositioning a company s go-to-market strategy (Hostess Brands). We believe Apollo s experience in accelerating and supporting growth within the Apollo Funds portfolio companies will enable Apollo Strategic Growth Capital III to identify and unlock value in targets with strong growth potential that are at the right stage in their life cycle to be listed in the public markets. Extensive Industry & Public Markets Expertise: Over the past 30+ years, through ownership of over 170 portfolio companies by Apollo Funds, Apollo has developed deep expertise and relationships with operating partners across a variety of sectors, including financial services; business and healthcare services; consumer services; chemicals; natural resources; consumer and retail; gaming and leisure; manufacturing and industrial; and media, telecom and technology. By leveraging this industry expertise and experience managing APSG I and APSG II, we believe Apollo Strategic Growth Capital III is better positioned to understand key trends, assess areas of revenue and margin upside, detect potential risks and structure transactions to maximize the potential for value creation. Apollo s private equity funds also have had a strong history of helping companies successfully transition to public ownership. As an example, in November 2016, Apollo helped take Hostess Brands public via a special purpose acquisition company transaction. Apollo s Differentiated Playbook of Driving Value Creation: The members of our team and their affiliates have extensive experience in working closely with board members and management teams to execute a holistic approach to value creation. Apollo Strategic Growth Capital III will have the ability to leverage Apollo Portfolio Performance Solutions ( APPS ), Apollo s in-house team dedicated to engaging with and driving impact at portfolio companies through operational improvements and transformational initiatives based on Apollo s institutionalized best practices. APPS is adept at working with Apollo Funds portfolio companies to implement cost and working capital efficiencies, build stronger businesses through mergers and acquisitions, identify and recruit leading management teams and leverage technology and advanced analytics to maximize financial impact. Woven into the fabric of Apollo s culture and approach is a commitment to recognize and realize the full value of environmental, social and governance (ESG) factors. Capital Structure Optimization and Capital Support: We believe Apollo Strategic Growth Capital III will benefit from Apollo s leading financing and capital markets expertise as one of the largest participants in the leveraged finance market. Apollo has a long history of assisting the Apollo Funds portfolio companies in structuring capital structures to maintain financial and operational flexibility, allowing for maximum value creation. Apollo s credit business is one of the largest alternative credit managers in the industry, with an ability to support high-quality companies by investing into existing capital structures, as well as by offering capital support in large size. As an example, Apollo Funds provided a direct financing to Airbnb in April 2020. Given this significant capital markets presence, Apollo maintains strong relationships with investment banks, institutional buyers of debt securities, and alternative sources of capital. Since 2016, Apollo has directly placed over $18 billion of financing for the Apollo Funds portfolio companies. Acquisition Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective targets for our initial business combination. We will TABLE OF CONTENTS leverage these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target that does not meet these criteria and guidelines. We intend to acquire target businesses that we believe: are leading companies that have exhibited positive top-line growth and/or are experiencing secular tailwinds; have defensible and established business models, with sustainable competitive advantages and multiple avenues for growth; can potentially benefit from having a public currency to accelerate growth trajectory; can benefit from our management team and Apollo s operating expertise, industry network and financing experience; are not reliant on financial leverage to generate returns; are at the point in their lifecycle at which going public is a natural next step; and will offer an attractive risk-adjusted return for our shareholders. We do not intend to pursue an acquisition in the natural resources, infrastructure or energy industries, including the upstream, midstream and energy services sub-sectors. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials that we would file with the SEC. Initial Business Combination The NYSE rules require that we must consummate our initial business combination with one or more operating businesses or assets with a fair market value equal to at least 80% of the net assets held in the trust account (excluding the amount of any deferred underwriting commissions held in trust) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm which is a member of the Financial Industry Regulatory Authority, or FINRA, or an independent accounting firm with respect to the satisfaction of such criteria. We may pursue an acquisition opportunity jointly with our sponsor, Apollo, or one or more of its affiliates, one or more Apollo Funds and/or investors in the Apollo Funds, which we refer to as an Affiliated Joint Acquisition. Any Apollo entity or any other entity to which an officer or director has a fiduciary or contractual obligation may co-invest with us in the target business at the time of our initial business combination, or we could raise additional proceeds to complete the acquisition by issuing to such parties a class of equity or equity-linked securities. Any such issuance of equity or equity-linked securities would, on a fully diluted basis, reduce the percentage ownership of our then-existing shareholders. Notwithstanding the foregoing, pursuant to the anti-dilution provisions of our Class B ordinary shares, issuances or deemed issuances of Class A ordinary shares or equity-linked securities would result in an adjustment to the ratio at which Class B ordinary shares will convert into Class A ordinary shares such that our initial shareholders and their permitted transferees, if any, would retain their aggregate percentage ownership at 20% of the sum of the total number of all ordinary shares outstanding upon completion of this offering plus all Class A ordinary shares and equity-linked securities issued or deemed issued in connection with the business combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in the business combination), unless the holders of a majority of the then-outstanding Class B ordinary shares agree to waive such adjustment with respect to such issuance or deemed issuance at the time thereof. Neither our TABLE OF CONTENTS sponsor nor Apollo, nor any of their respective affiliates, have an obligation to make any such investment, and may compete with us for potential business combinations. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, including an Affiliated Joint Acquisition as described above. However, we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires an interest in the target sufficient for the post-transaction company not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the NYSE s 80% of net assets test. If the initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for seeking shareholder approval or for purposes of a tender offer, as applicable. Our Acquisition Process In evaluating a prospective target business, we expect to conduct a rigorous due diligence review of issues that we deem important to validating a company s business quality and assessing growth and value creation opportunities, allowing our management team to price returns relative to potential risks appropriately. This review may encompass, among other things, research related to the company s industry, markets, products, services and competitors, meetings with incumbent management and employees, on-site visits and a review of financial and other information which will be made available to us. Our approach to the acquisition process will be centered around leveraging Apollo s existing network and knowledge base across its integrated platform and our management team s operational and capital allocation expertise to target high-quality, established businesses where we see multiple opportunities for continued organic and strategic growth. We are not prohibited from pursuing an initial business combination with a company that is affiliated with Apollo, our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with Apollo, our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm which is a member of FINRA or an independent accounting firm that our initial business combination is fair to our company from a financial point of view. Apollo, members of our management team and our independent directors will directly or indirectly own founder shares and/or private placement warrants following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Our officers and directors have not selected a target business for our initial business combination. All of the members of our management team are also employed by Apollo. Apollo is continuously made aware of potential business opportunities, one or more of which we may desire to pursue for a business combination. TABLE OF CONTENTS Each of our officers and directors presently has, and any of them in the future may have, additional fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity. Certain members of our management team and directors who are affiliated with Apollo have fiduciary duties or are subject to contractual obligations or policies and procedures that require them to present business opportunities that may be appropriate for one or more Apollo Funds to the respective investment committees of such funds prior to presenting such opportunities to us regardless of the capacity in which they are made aware of such opportunities. In addition, certain members of our management team and directors have fiduciary duties to APSG II, Acropolis and Delphi. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity, including APSG II, Acropolis, Delphi and/or any other Apollo entity, to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such other entity, including APSG II, Acropolis, Delphi and/or any other Apollo entity. If these entities decide to pursue any such opportunity, we may be precluded from pursuing such opportunities. As a result, APSG II, Acropolis or Delphi may be given priority over us with respect to business combination opportunities. Our amended and restated memorandum and articles of association will provide that to the maximum extent permitted by applicable law, we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for both us and another entity, including APSG II, Acropolis, Delphi and/or any other Apollo entity, about which any member of our management team or director acquires knowledge and we will waive any claim or cause of action we may have in respect thereof. In addition, we may pursue an Affiliated Joint Acquisition opportunity with an entity to which an officer or director has a fiduciary or contractual obligation. Any Apollo entity or any other entity to which an officer or director has a fiduciary or contractual obligation may co-invest with us in the target business at the time of our initial business combination, or we could raise additional proceeds to complete the acquisition by borrowing from or issuing to such entity a class of equity or equity-linked securities. We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our business combination. In addition, our officers and directors are not required to commit any specified amount of time to our affairs, and, accordingly, will have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. Moreover, our officers and directors have and will have in the future time and attention requirements for current and future investment funds, accounts, co-investment vehicles and other entities managed by Apollo or its affiliates. Apollo manages a significant number of Apollo Funds and will raise additional funds and/or accounts in the future, which will be during the period in which we are seeking our initial business combination. These Apollo investment entities may be seeking acquisition opportunities and related financing at any time. We may compete with any one or more of them on any given acquisition opportunity. To the extent any conflict of interest arises between, on the one hand, us and, on the other hand, investment funds, accounts, co-investment vehicles and other entities managed by Apollo or its affiliates (including, without limitation, arising as a result of certain of our officers and directors being required to offer acquisition opportunities to Apollo or investment funds, accounts, co-investment vehicles and other entities), Apollo and its affiliates will resolve such conflicts of interest in their sole discretion in accordance with their then existing fiduciary, contractual and other duties and there can be no assurance that such conflict of interest will be resolved in our favor. In addition, Apollo and its affiliates, as well as Apollo Funds, have sponsored other blank check companies in the past and may sponsor other blank check companies similar to ours during the period in which we are seeking an initial business combination, and members of our management team may participate in such blank check companies. In particular, an affiliate of Apollo formed, and such affiliate, Mr. Patel and Mr. James Crossen (our Chief Financial Officer) are actively engaged in, APSG I, a special purpose acquisition company that completed its initial public offering in October 2020, and entered into a definitive business combination agreement in December 2021. An affiliate of Apollo formed, and such affiliate, Mr. Patel and Mr. Crossen are actively engaged in, APSG II, a special purpose acquisition company that completed its initial public offering in February 2021. APSG II, like us, may pursue initial business combination targets in any businesses or industries and has until February 2023 to do so (which date may be extended under certain circumstances). In addition, an affiliate of Apollo formed, and such affiliate and Mr. Crossen were previously engaged in, Spartan I, a special purpose acquisition company that completed its TABLE OF CONTENTS initial public offering in August 2018 and completed its initial business combination in October 2020. An affiliate of Apollo also formed, and such affiliate and Mr. Crossen were also previously engaged in, Spartan II, a special purpose acquisition company that completed its initial public offering in November 2020, and completed its initial business combination in July 2021. An affiliate of Apollo also formed, and such affiliate and Mr. Crossen are actively engaged in, Spartan III, a special purpose acquisition company that completed its initial public offering in February 2021 and in July 2021 entered into a definitive agreement for its initial business combination. Additionally, an affiliate of Apollo formed, and such affiliate is actively engaged in, Spartan IV, a special purpose acquisition company that originally filed a registration statement on Form S-1 on March 24, 2021. In addition, an affiliate of Apollo also formed, and such affiliate and Mr. Crossen are actively engaged in, Acropolis, a special purpose acquisition company that completed its initial public offering in July 2021. Acropolis may pursue initial business combination targets in any businesses or industries and has until July 2023 to do so (which date may be extended under certain circumstances). Finally, an affiliate of Apollo also formed, and such affiliate and Mr. Crossen are actively engaged in, Delphi, a special purpose acquisition company that originally filed a registration statement on Form S-1 on December 23, 2021. To the extent that the potential target pipeline remains robust, it is more likely Apollo or its affiliates, as well as Apollo Funds, will sponsor additional blank check companies in the future. Any such companies, including APSG II, Spartan IV, Acropolis and Delphi, may present additional conflicts of interest in pursuing an acquisition target, particularly in the event there is overlap among investment mandates and the board and management teams. Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination.
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+Prospectus Summary 1
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our securities, you should carefully read this entire prospectus, including our consolidated financial statements and the related notes thereto and the information set forth in the sections titled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations. Unless otherwise indicated or the context otherwise requires, references in this prospectus to the company, we, us, our, Wag!, and other similar terms refer to Wag! Group Co. and its wholly owned subsidiaries. Overview Our mission is to be the #1 partner to busy Pet Parents. We believe that being busy shouldn t stop Pet Parents from owning or taking care of their pets. We are dedicated to building a future in which every pet has access to safe, high-quality care. This future will be built by a passionate community of pet lovers who want to spend their time creating joy for pets and those who love them. Wag! is the technology platform for building that future, and we are just getting started. Wag! exists to make pet ownership possible and to bring joy to pets and those who love them. We are committed to maximizing the happiness of pets and Pet Parents alike. Your furry family member deserves our best, and that s what we deliver every day, through thoughtful innovation and dedicated team support. Wag! develops and supports a proprietary marketplace technology platform available as a website and mobile app that enables independent Pet Caregivers to connect with Pet Parents. The platform allows Pet Parents, who require specific pet care services, to make service requests in the platform, which are then fulfilled by Pet Caregivers. Wag! supports dog walking, pet sitting and boarding, advice from licensed pet experts, home visits, training, and access to other services in 5,300 U.S. cities across all 50 states. From our founding in 2015 through June 2022, we have approved over 400,000 Pet Caregivers and there have been over 12.1 million services completed through the Wag! platform. Wag! exists to make pet ownership possible and bring joy to pets and those who love them. We derive revenue from four distinct streams: (1) service fees charged to Pet Caregivers, (2) subscription and other fees paid by Pet Parents for Wag! Premium, (3) joining fees paid by Pet Caregivers to join and be listed on our platform, and (4) wellness revenue through affiliate fees, in which we are compensated for end users that are directed to the third party by our platform and, depending on the specific provider, when such end users purchase pet insurance plans from those third-party providers. Recent Developments On August 5, 2022, CHW entered into Forward Share Purchase Agreements (each, a Forward Purchase Agreement and collectively, the Forward Purchase Agreements ) with each of Milton Arbitrage Partners, LLC, MMCAP International Inc. SPC, Nautilus Master Fund, L.P. and Polar Multi-Strategy Master Fund (each, an Investor and collectively, the Investors ) pursuant to which the Investors purchased in the aggregate 2,393,378 shares of common stock of Wag!. This resulted in the Investors holding a total of 2,393,378 shares of common stock, which the Investors may elect to sell and transfer to Wag! on November 9, 2022. Wag! has placed $24,651,793.40 in escrow at the Closing of the Business Combination to secure its purchase obligations to the Investors under the Forward Purchase Agreements. As these funds are held in escrow and recorded as restricted on our balance sheet, our business strategy will not be impacted in the event that we are required to purchase some or all requisite shares of stock pursuant to the Forward Purchase Agreements. Corporate Information We were originally known as CHW Acquisition Corporation. On the Closing, Legacy Wag!, CHW, and the Merger Sub consummated the transactions contemplated under the Business Combination Agreement, following the approval at the extraordinary general meeting of the stockholders of CHW held on July 28, 2022 (the Special Meeting ). In connection with the Closing, we changed our name from CHW Acquisition Corporation to Wag! Group Co. TABLE OF CONTENTS Our principal executive offices are located at 55 Francisco Street, Suite 360, San Francisco, CA 94133, and our telephone number is (707) 324-4219. Our corporate website address is https://wag.co/. Information contained on or accessible through our website is not a part of this prospectus, and the inclusion of our website address in this prospectus is an inactive textual reference only. Wag! and our other registered and common law trade names, trademarks and service marks are property of Wag! Group Co. This prospectus contains additional trade names, trademarks and service marks of others, which are the property of their respective owners. Solely for convenience, trademarks and trade names referred to in this prospectus may appear without the or symbols. Emerging Growth Company Status We are an emerging growth company, as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ), and may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that an emerging growth company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such an election to opt out is irrevocable. We have elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our financial statements with another public company that is neither an emerging growth company nor an emerging growth company that has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. We will remain an emerging growth company under the JOBS Act until the earliest of (a) December 31, 2027, (b) the last date of our fiscal year in which we have a total annual gross revenue of at least $1.07 billion, (c) the date on which we are deemed to be a large accelerated filer under the rules of the SEC with at least $700.0 million of outstanding securities held by non-affiliates or (d) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the previous three years.
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+SUMMARY OF THE PROSPECTUS This summary highlights certain information about us, this offering and selected information contained elsewhere in this prospectus. This summary is not complete and does not contain all of the information that you should consider before deciding whether to invest in the securities covered by this prospectus. You should read the following summary together with the more detailed information in this prospectus, any related prospectus supplement and any related free writing prospectus, including the information set forth in the section titled Risk Factors in this prospectus, any related prospectus supplement and any related free writing prospectus in their entirety before making an investment decision. Unless otherwise stated or unless the context otherwise requires, the terms Company, the registrant, our company, the company, we, us, our, ours, and Otonomo refer to Otonomo Technologies Ltd., a company organized under the laws of the State of Israel, and its consolidated subsidiaries. Overview Otonomo fuels an ecosystem of OEMs, fleets and more than 100 service providers spanning the transportation, mobility and automotive industries. Our platform securely ingests more than 4 billion data points per day globally from over 50 million vehicles licensed on the platform and massive amounts of mobility demand data from multimodal sources, then reshapes and enriches it to accelerate time to market for new services that improve the mobility and transportation experience. We provide deeper visibility and actionable insights to empower strategic data-driven decisions taking the guesswork out of mobility and transportation planning, deployment and operations. As part of our proprietary data platform, we have developed a robust suite of software-as-a-service ( SaaS ) offerings that provide both OEMs and service providers with additional capabilities, and that incorporate vertically specific applications to meet different privacy, regulation, storage, visualization and data insight needs. Privacy by design and neutrality are at the core of our platform, which enables compliance with regulations such as GDPR, CCPA, and other vehicle specific regulations, such as the EU requirement/directive that OEMs share connected car data with third parties or the Massachusetts Right to Repair Act allowing access to vehicle data for maintenance and repair purposes. The Otonomo Mobility Platform is utilized by organizations and businesses across diverse areas, including urban planning, transportation companies, fleet services, insurance companies, financial institutions, dealerships, and more. Recent Developments Consummation of the Business Combination On January 31, 2021, we entered into that certain Business Combination Agreement with Software Acquisition Group Inc. II ( SWAG ) and Butterbur Merger Sub Inc. ( Merger Sub ) (the Business Combination Agreement ). Pursuant to the Business Combination Agreement, Merger Sub merged with and into SWAG, with SWAG surviving the merger (the Business Combination ). On August 13, 2021 (the Closing Date ), upon the consummation of the Business Combination and the other transactions contemplated by the Business Combination Agreement (the Transactions ), SWAG became a wholly owned subsidiary of Otonomo. Concurrently with the execution of the Business Combination Agreement, Otonomo and certain accredited investors (the PIPE Investors ) entered into a series of subscription agreements ( Subscription Agreements ). On the Closing Date, the PIPE Investors purchased an aggregate of 14,250,000 ordinary shares ( PIPE Shares ) at a price per share of $10.00 for gross proceeds to Otonomo of $142,500,000 (collectively, the PIPE Investment ). In addition, concurrently with the execution of the Business Combination Agreement, Otonomo, certain Otonomo shareholders (the Selling Shareholders ) and certain accredited investors (the Secondary PIPE Investors ) entered into a share purchase agreement ( Share Purchase Agreement ). On the Closing Date, providing the Secondary PIPE Investors purchased an aggregate of 3,000,000 ordinary shares ( Secondary PIPE Shares ) from the Selling Shareholders at a price per share of $10.00 for gross proceeds to the Selling Shareholders of $30,000,000 (collectively, the Secondary PIPE ). As filed with the Securities and Exchange Commission on May 6, 2022 Registration No. 333- UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM F-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 OTONOMO TECHNOLOGIES LTD. (Exact Name of Registrant as Specified in its Charter) State of Israel 7372 Not Applicable (State or Other Jurisdiction of Incorporation or Organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification No.) Otonomo Technologies Ltd. 16 Abba Eban Blvd. Herzliya Pituach 467256, Israel +(972) 52-432-9955 (Address, including zip code, and telephone number, including area code, of Registrant s principal executive offices) Cogency Global Inc. 122 East 42nd Street, 18th Floor New York, NY 10168 (800) 221-0102 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Ryan J. Maierson John M. Greer Latham & Watkins LLP 811 Main Street, Suite 3700 Houston, Texas 77002 Tel: (713) 546-5400 Joshua G. Kiernan Latham & Watkins LLP 99 Bishopsgate London EC2M 3XF United Kingdom Tel: (+44) (20) 7710-1000 Amir Raz Perry Wildes Gross & Co. One Azrieli Center Tel Aviv 6701101, Israel Tel: +972 (3) 607-4444 Approximate date of commencement of proposed sale to the public: From time to time after the effectiveness of this registration statement. If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933. Emerging growth company If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. Pursuant to Rule 429(b) under the Securities Act, upon effectiveness, this registration statement shall constitute Post-Effective Amendment No. 3 to the Registration Statement on Form F-1 (File No. 333-259144) and Post-Effective Amendment No. 2 to the Registration Statement on Form F-1 (File No. 333-260571), which Post-Effective Amendments shall hereafter become effective concurrently with the effectiveness of this Registration Statement in accordance with Section 8(c) of the Securities Act. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission (the SEC ), acting pursuant to said Section 8(a), may determine. EXPLANATORY NOTE This registration statement, which is a new registration statement, also constitutes Post-Effective Amendment No. 3 on Form F-1 to the registration statement on Form F-1 (File No. 333-259144) and Post-Effective Amendment No. 2 on Form F-1 to the registration statement on Form F-1 (File No. 333-260571), in each case, filed by Otonomo Technologies Ltd. (the Company ) and, in that regard, is being filed pursuant to the undertakings in Item 9 in such Form F-1 to file a post-effective amendment in relation thereto. Accordingly, this registration statement on Form F-1 contains a combined prospectus (the Combined Prospectus ) pursuant to Rule 429 under the Securities Act of 1933, as amended (the Securities Act ). The Combined Prospectus relates to the following registration statements: (1) the Registration Statement on Form F-1 originally filed with the SEC on August 30, 2021 (File No. 333-259144), which was declared effective on September 8, 2021 (the August Registration Statement ); (2) the Registration Statement on Form F-1 originally filed with the SEC on October 29, 2021 (File No. 333-260571), which was declared effective on November 3, 2021 (the November Registration Statement and, together with the August Registration Statement, the Prior Registration Statements ); and (3) this Registration Statement on Form F-1 (this Registration Statement ). The August Registration Statement registered (a) the issuance of 13,825,000 ordinary shares issuable upon the exercise of warrants, and (b) the resale of (i) 92,071,690 ordinary shares, (ii) 5,200,000 warrants and (iii) 5,200,000 ordinary shares issuable upon the exercise of warrants, in each case, from the Prior Registration Statement. The November Registration Statement registered (a) the issuance of 13,825,000 ordinary shares issuable upon the exercise of warrants, and (b) the resale of (i) 98,631,650 ordinary shares, (ii) 5,200,000 warrants and (iii) 5,200,000 ordinary shares issuable upon the exercise of warrants, in each case, from the Prior Registration Statement. Pursuant to Rule 416(a) of the Securities Act, the Prior Registration Statements also registered an indeterminable number of additional ordinary shares as may be issued to prevent dilution resulting from share splits, share capitalizations and similar transactions and accordingly the Combined Prospectus also covers any such additional ordinary shares. We are filing the Combined Prospectus to satisfy the requirements of the Securities Act and the rules and regulations thereunder for the offerings registered on the Prior Registration Statements in order to maintain the effectiveness of the Prior Registration Statements. Pursuant to Rule 429(b) under the Securities Act, upon effectiveness, this Registration Statement shall constitute Post-Effective Amendment No. 3 to the August Registration Statement and Post-Effective Amendment No. 2 to the November Registration Statement, which post-effective amendments shall hereafter become effective concurrently with the effectiveness of this Registration Statement in accordance with Section 8(c) of the Securities Act. This Registration Statement (a) registers the resale of 98,450 ordinary shares by the selling securityholders named in the Combined Prospectus that received such ordinary shares as additional consideration in connection with the Neura Acquisition (as defined herein) and (b) includes information contained in the registrant s Annual Report on Form 20-F and certain other information. Neura Acquisition On October 4, 2021, pursuant to that certain Agreement and Plan of Merger, dated as of October 4, 2021, by and among Otonomo, Neura, Inc. ( Neura ) and the other parties thereto (the Neura Merger Agreement ), Otonomo acquired Neura, a leader in Artificial Intelligence (AI)-powered mobility intelligence (the Neura Acquisition ). Otonomo acquired 100% of Neura s outstanding equity interests for transaction consideration of $46.8 million, including the issuance of ordinary shares (the Neura Shares ). Otonomo expects its newly expanded mobility intelligence platform to leverage Neura s advanced analytics powered by patented AI and Machine Learning technologies and diverse multi-layered data. The Floow Acquisition On February 26, 2022, Otonomo entered into the transactions effected under that certain definitive agreement, dated as of February 26, 2022 (the Floow SPA ), to acquire The Floow, a SaaS provider of connected insurance technology for major carriers globally ( The Floow ), in a cash and stock deal valued at approximately $69 million, including a performance based earnout of up to $37.5 million. Under the definitive agreement, the aggregate cash and stock consideration to be paid and issued upon closing is valued at $31.5 million based on a share price of $2.75. Otonomo may issue additional cash and stock of up to $37.5 million dependent upon achievement of certain business performance objectives. The acquisition of the Floow closed on April 14, 2022. Otonomo believes the combination of vehicle and mobile data from Otonomo and The Floow will be crucial to enabling innovative, usage-based and behavioral-based insurance products and to move from detect and repair to predict and prevent models to create safer, greener and smarter driving experiences for policy holders. Over the last decade, The Floow has built a portfolio of connected insurance clients, alongside strategic partnerships with Munich Re and TransUnion. The Floow's data refinery platform enables insurance carriers to introduce connectivity to their products and differentiate their offerings through a more precise understanding of risk in the context of personalized products and services, improved road safety through driver coaching and timely, accurate roadside assistance. Implications of Being an Emerging Growth Company We qualify as an emerging growth company, as defined in the JOBS Act. For as long as we are deemed an emerging growth company, we are permitted to and intend to take advantage of specified reduced reporting and other regulatory requirements that are generally unavailable to other public companies, including: an exemption from the auditor attestation requirement in the assessment of our internal controls over financial reporting required by Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act; and an exemption from compliance with any new requirements adopted by the Public Company Accounting Oversight Board, or the PCAOB, requiring mandatory audit firm rotation or a supplement to the auditor s report in which the auditor would be required to provide additional information about our audit and our financial statements. We may take advantage of these provisions until the last day of our fiscal year following the fifth anniversary of the date of the first sale of our common equity securities pursuant to an effective registration statement under the Securities Act of 1933, as amended, or the Securities Act. However, if certain events occur prior to the end of such five year period, including if we become a large accelerated filer, our annual gross revenues exceed $1.07 billion or we issue more than $1.0 billion of non-convertible debt in any three-year period, we will cease to be an emerging growth company prior to the end of such five-year period. Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. The information contained in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED MAY 6, 2022 PRELIMINARY PROSPECTUS OTONOMO TECHNOLOGIES LTD. PRIMARY OFFERING OF 13,825,000 ORDINARY SHARES SECONDARY OFFERING OF 80,122,337 ORDINARY SHARES, 5,200,000 WARRANTS TO PURCHASE ORDINARY SHARES AND 5,200,000 ORDINARY SHARES UNDERLYING WARRANTS OF OTONOMO TECHNOLOGIES LTD. This prospectus relates to the issuance from time to time by Otonomo Technologies Ltd., a company organized under the laws of the State of Israel ( we, our, the Company or Otonomo ) of up to 13,825,000 ordinary shares, no par value per share (the ordinary shares ), including (a) 8,625,000 ordinary shares issuable upon the exercise of warrants of the Company ( warrants ) that were issued in exchange for the public warrants of Software Acquisition Group Inc. II, a Delaware corporation ( SWAG ) (the public warrants ), at the closing of the Business Combination (as defined herein), and (b) 5,200,000 ordinary shares issuable upon the exercise of the warrants that were issued in exchange for the private warrants of SWAG (the private warrants ) at the closing of the Business Combination. This prospectus also relates to the resale, from time to time, by the selling securityholders named herein (the Selling Securityholders ), or their pledgees, donees, transferees, or other successors in interest, of (a) up to 80,122,337 ordinary shares, (b) up to 5,200,000 warrants and (c) up to 5,200,000 ordinary shares issuable upon exercises of warrants we issued to certain of the Selling Securityholders, as described below. Each warrant entitles the holder to purchase one ordinary share at an exercise price of $11.50 per share commencing on September 12, 2021 and will expire on August 13, 2026, at 5:00 p.m., New York City time, or earlier upon redemption of the warrants or liquidation of the Company. We may redeem the outstanding public warrants at a price of $0.01 per warrant if the last reported sales price of our ordinary shares equals or exceeds $18.00 per ordinary share (subject to adjustment in accordance with the terms of the warrants) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders, as described herein. The private warrants have terms and provisions that are identical to those of the public warrants, except as described herein. We are registering these securities for resale by the Selling Securityholders named in this prospectus, or their transferees, pledgees, donees or assignees or other successors-in-interest that receive any of the shares as a gift, distribution, or other non-sale related transfer. We are registering the offer and sale of these securities to satisfy certain registration rights we have granted. The Selling Securityholders may offer and sell any of the securities from time to time at fixed prices, at market prices or at negotiated prices, and may engage a broker, dealer or underwriter to sell the securities. In connection with any sales of securities offered hereunder, the Selling Securityholders, any underwriters, agents, brokers or dealers participating in such sales may be deemed to be underwriters within the meaning of the Securities Act. For additional information on the possible methods of sale that may be used by the Selling Securityholders, you should refer to the section entitled Plan of Distribution elsewhere in this prospectus. We do not know when or in what amounts the Selling Securityholders may offer the securities for sale. The Selling Securityholders may sell any, all or none of the securities offered by this prospectus. All of the ordinary shares and warrants (including ordinary shares issuable upon the exercise of such warrants) offered by the Selling Securityholders pursuant to this prospectus will be sold by the Selling Securityholders for their respective accounts. We will not receive any proceeds from the sale of any securities by the Selling Securityholders. We will receive up to an aggregate of $159.0 million from the exercise of the warrants, assuming the exercise in full of all the warrants for cash. If the warrants are exercised pursuant to a cashless exercise feature, we will not receive any cash from these exercises. We expect to use the net proceeds from the exercise of the warrants, if any, for general corporate purposes. We will pay certain expenses associated with the registration of the securities covered by this prospectus, as described in the section entitled Plan of Distribution. This means that an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to delay such adoption of new or revised accounting standards. As a result, our financial statements may not be comparable to companies that comply with the public company effective date. Implications of Being a Foreign Private Issuer We are subject to the information reporting requirements of the Securities Exchange Act of 1934, or the Exchange Act, that are applicable to foreign private issuers, and under those requirements we file reports with the Securities and Exchange Commission, or the SEC. As a foreign private issuer, we are not subject to the same requirements that are imposed upon U.S. domestic issuers by the SEC. Under the Exchange Act, we are subject to reporting obligations that, in certain respects, are less detailed and less frequent than those of U.S. domestic reporting companies. For example, we are not required to issue quarterly reports, proxy statements that comply with the requirements applicable to U.S. domestic reporting companies, or individual executive compensation information that is as detailed as that required of U.S. domestic reporting companies. We also have four months after the end of each fiscal year to file our annual reports with the SEC and are not required to file current reports as frequently or promptly as U.S. domestic reporting companies. Furthermore, our officers, directors and principal shareholders are exempt from the requirements to report transactions in our equity securities and from the short-swing profit liability provisions contained in Section 16 of the Exchange Act. As a foreign private issuer, we are also not subject to the requirements of Regulation FD (Fair Disclosure) promulgated under the Exchange Act. These exemptions and leniencies reduce the frequency and scope of information and protections available to you in comparison to those applicable to shareholders of U.S. domestic reporting companies. We intend to continue to take advantage of the exemptions available to us as a foreign private issuer during and after the period we qualify as an emerging growth company. Our Corporate Information We were incorporated in the state of Israel on December 8, 2015 under the Israeli Companies Law, 5759-1999 (the Companies Law ), and our principal executive office is located at 6 Abba Eban Blvd., Herzliya Pituach 467256, Israel. Our legal and commercial name is Otonomo Technologies Ltd. We are registered with the Israeli Registrar of Companies. Our registration number is 51-53528-13. Our website address is www.otonomo.io, and our telephone number is +(972) 52-432-9955. Information contained on, or that can be accessed through, our website does not constitute a part of this Annual Report and is not incorporated by reference herein. We have included our website address in this prospectus solely for informational purposes. The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers, such as we, that file electronically, with the SEC at www.sec.gov. Our agent for service of process in the United States is Cogency Global Inc., 122 East 42nd Street, 18th Floor, New York, NY 10168. Our ordinary shares and warrants are listed on the Nasdaq Stock Market LLC under the trading symbols OTMO and OTMOW, respectively. On May 5, 2022, the closing prices for our ordinary shares and warrants on the Nasdaq Stock Market LLC were $1.50 per ordinary share and $0.15 per warrant. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. We are an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012, or JOBS Act, and are subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 5 of this prospectus and other risk factors contained in the documents incorporated by reference herein for a discussion of information that should be considered in connection with an investment in our securities. Neither the Securities and Exchange Commission, the Israeli Securities Authority nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001842563_go-go_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001842563_go-go_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..1f9f2441f1adf2b12208eec21a57b1b03d8c2511
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001842563_go-go_prospectus_summary.txt
@@ -0,0 +1,165 @@
+PROSPECTUS SUMMARY
+
+ 
+
+As used in this prospectus, unless the context
+otherwise requires, "we," "us," "our," and "Go Go Buyers" refers to Go Go Buyers. The
+following summary does not contain all of the information that may be important to you. You should read the entire prospectus before
+making an investment decision to purchase our common stock.
+
+ 
+
+GO GO BUYERS 
+
+ 
+
+Go Go Buyers was incorporated in Nevada on January
+10, 2019. We aim at the companies involved in retailing and resale business. We plan to offer them a convenient web platform that they
+can use for locating new customers and conducting operations with them. Small businesses will have an opportunity to represent their services
+in order to get direct or indirect orders from their target audience. The management of the Company considers our main service in assistance
+in deliveries for small companies. Apart from that, we are planning to encourage individual travelers and buyers to use our website for
+their casual needs. At present, we do not have an operational web platform. The Company is actively working on its building. We have created
+a website domain. You can refer to it at https://gogobuyers.com/. Currently, we are working on the filling of the website.
+
+ 
+
+Our company aims at businesses operating in instantly
+expanding and changing market of delivery of goods. We intend to dedicate our website to small businesses who seek to gain or improve
+their awareness and publicity. Such companies will be able to keep consumers informed of the companies on the market along with their
+prices and actual offers. The companies engaged in the market of delivery of goods and intending to participate will be asked to provide
+us with their portfolios. This way potential users will be able to check upon the diversity of products, prices, discounts or special
+offers. The management expects the search among the companies and their services will be eased. Future visitors of our website will navigate
+the platform using proposed search inquiries or by browsing through
+
+the whole list of companies of their choice. They
+also will be able to search by various categories. We are also considering adding search filters such as , ' ': expensive/cheap first 
+or filters by availability of a certain piece of goods or type of it. One more feature that we are looking into adding is providing
+an opportunity to compare certain kinds of goods. In our opinion, it will help our future customers find the best suitable product in
+the most convenient way. They will able to see if the price is in the range exceeds it, as well as how fast the delivery will arrive depending
+on the location of the user and the traffic report.
+
+ 
+
+6
+
+ 
+
+We see our main service as assistance in delivery
+of goods of those companies, as we plan to help build a network of clientele for the companies mentioned, by attracting users to our web
+platform, offering a variety of delivery possibilities and companies.
+
+We also plan to provide a more convenient alternative
+to regular delivery services for individuals. Go Go Buyers platform is intended to be a web service where parties who deliver and
+parties who need to get goods delivered can connect and discuss details of their cooperation.
+
+We are going to use the net proceeds from this
+offering for developing our business operations (see "Description of Business" and "Use of Proceeds" for detailed
+information). In order to implement our current plan of operations, we need a minimum of $19,687.5 for the next twelve months as described
+in our Plan of Operations. There is no assurance that we will generate sufficient revenue in the first 12 months after completion of our
+offering or that we will ever generate additional revenue.
+
+Our operating history is very limited as of
+the date of this prospectus. In case we do not generate revenue, we will need a minimum of $8,000 of additional funding to pay for ongoing
+SEC filing requirements. Our principal executive offices are located at 474, village 3, sangkat 3 Sihanoukville, Sihanouk province,
+18203 Kingdom of Cambodia. Our phone number is +15305394950. 
+
+From inception (January 10, 2019) till the date
+of this filing, we have had limited operating activities. Our financial statements from inception (January 10, 2019) through June 30,
+2022 report $0 of revenue and a net loss of $17,876. Our independent registered public accounting firm issued an opinion for Go Go Buyers
+that includes an explanatory paragraph expressing serious doubt about ability to continue as a going concern.
+
+As of today, the prepaid balance is $6,000.
+The amount was paid for developing the website project and design, layout and content, and coding. We have created a website domain (https://gogobuyers.com/)
+and are working on the filling of the website. For further development, we require more significant expenses that will entail further
+designing, building, and filling out the website content.
+
+ 
+
+7
+
+ 
+
+As of the date of this prospectus, there is
+no public trading market for our common stock and there can be no assurance that a trading market for our securities will ever develop
+in future.
+
+We require the proceeds from this offering in
+order to proceed with our current business plan over the period of next twelve months. We need a minimum funding of approximately $19,687.5
+for conducting our proposed operations and pay all expenses for a period of one year including expenses associated with this offering
+and maintaining a reporting status with the SEC. In case we are unable to obtain minimum funding of approximately $19,687.5, our business
+will probably fail. As long as we are considered a startup company at this stage, we cannot provide any assurance that we will be able
+to successfully sell any services related to our planned activities.
+
+ 
+
+THE OFFERING
+
+ 
+
+ 
+ 
+ 
+
+ 
+
+ 
+ 
+ The Issuer:
+
+ 
+
+ Go Go Buyers
+
+ 
+ 
+ Securities Being Offered:
+
+ 
+
+ 3,500,000 shares of common stock
+
+ 
+ Price Per Share:
+ $0.0225
+
+ 
+ 
+ Duration of the Offering:
+
+ 
+
+ The shares are to be offered for a period of three hundred and sixty-five (365) days from the effective date of this prospectus. The offering shall terminate on the earlier of (i) when the offering period ends (365 days from the effective date of this prospectus), (ii) the date when the sale of all 3,500,000 shares is completed, (iii) when the Board of Directors decides that it is in the best interest of the Company to terminate the offering prior the completion of the sale of all 3,500,000 shares registered under the Registration Statement of which this Prospectus is part. 
+
+ 
+ 
+ Gross Proceeds
+
+ 
+
+ 
+ If 25% of the shares sold - $19,687.5
+
+ If 50% of the shares sold - $39,375
+
+ If 75% of the shares sold - $59,062.5
+
+ If 100% of the shares sold - $78,750
+
+ 
+ Securities Issued and Outstanding:
+ 
+ There are 3,000,000 shares of common stock issued
+ and outstanding as of the date of this prospectus, held by our president, treasurer, secretary and director, Sna Ny. 
+
+ If we are successful at selling all the shares in
+ this offering, we will have 6,500,000 shares issued and outstanding.
+
+ 
+ Subscriptions
+ All subscriptions once accepted by us are irrevocable.
+
+ 
+ Registration Costs
+ 
+ We estimate our total offering registration costs
+ to be approximately $8,000.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001843388_virgin_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001843388_virgin_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..e6f097e7e0c6219616e1e1c1eb06e380ccf63a5d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001843388_virgin_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus. It may not contain all of the information that may be important to you. You should read this entire prospectus carefully, including the section titled Risk Factors and our historical consolidated financial statements and related notes included in this prospectus. Except as otherwise indicated herein or as the context otherwise requires, references in this prospectus to we, our, us and the Company refer to Virgin Orbit Holdings, Inc. and its subsidiaries. Vision Our vision is to use space to drive positive and lasting change on Earth, from connecting communities to advancing scientific initiatives, supporting America s and other nations space presence, and helping create the next generation of world-changing space technology. Overview We are a vertically integrated space company that provides customers with dedicated and rideshare small satellite launch capabilities. Our philosophy is to operate a mobile launch system that can launch at any time, from any place, to any orbit. So far, we have successfully completed a total of four orbital launches in 2021 and 2022, which we believe demonstrates the efficacy of our launch system. To date, we have delivered 33 satellites for commercial, civil and national security and defense customers to their desired orbits with high precision. Through our proprietary mobile launch system, we offer greater and more predictable access to space, enabling our vision of using space to drive positive and lasting change on Earth. Since our founding in 2017, we have invested in research and development efforts to develop a unique air-launch system, comprised of Cosmic Girl, a modified Boeing 747 aircraft, and the LauncherOne rocket. Cosmic Girl serves as a reusable mobile launch pad, carrying LauncherOne aloft, and LauncherOne is a two-stage rocket that is the world s first and only liquid-fueled, air-launched rocket to reach orbit successfully. This mobile system allows us to serve a broad array of applications and markets, providing customers with a highly differentiated solution to launch satellites relative to other existing small satellite ground launch providers. We operate within the large and growing space economy, estimated to reach $1 trillion by 2040 according to a 2020 Morgan Stanley report. We believe there is near- and medium-term acceleration in the growth of the space market, driven by rapid advances in launch and satellite technology. As a result, there has been a proliferation of private sector space companies pursuing the growing demand for space solutions across multiple applications. There are numerous private small-satellite launch companies (focused on carrying less than 1,000 kg to 500 km low Earth orbit), but to our knowledge, only five companies have completed a successful launch to orbit Astra Space, Northrop Grumman, Rocket Lab, SpaceX s dedicated rideshare program and Virgin Orbit. As one of the few proven small satellite launch providers, we believe we are well-positioned to benefit from these attractive industry tailwinds. We believe these features make LauncherOne a system of great interest for responsive space. By utilizing an air-launch system via Cosmic Girl and the LauncherOne rocket, we believe that we offer the agility, flexibility and responsiveness that small satellite customers need to achieve their mission objectives. Our launches have delivered satellites to orbit for customers across commercial, civil and national security and defense markets, both domestically and internationally. Leveraging the successes from these launches, we have been able to secure active contracts representing approximately $575.6 million of potential revenue as of March 31, 2022, of which $156.9 million is under binding agreements, and $418.7 million is under non-binding memorandums ( MOUs ) and letters of intent ( LOIs ). We develop and manufacture our launch technology from a vertically-integrated manufacturing facility in Long Beach, California. Leveraging advanced, state-of-the-art manufacturing capabilities, including automation and additive manufacturing technologies, we believe we have the necessary infrastructure in-place to meet the medium-term demand for our launch business. The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion, dated July 26, 2022. PROSPECTUS Virgin Orbit Holdings, Inc. 20,000,000 Shares of Common Stock Pursuant to this prospectus, we are registering the offer and sale, from time to time, of up to 20,000,000 shares of common stock of Virgin Orbit Holdings, Inc. (the Company , Virgin Orbit , we , us and our ) by YA II PN, Ltd. ( Selling Stockholder ). The shares of common stock being offered by the Selling Stockholder may be issued upon the conversion of a certain convertible debenture (the Debenture ) equating to an aggregate amount of $50,000,000 issued pursuant to a Securities Purchase Agreement that we entered into with the Selling Stockholder on June 29, 2022 (the Securities Purchase Agreement ). For additional information regarding the methods of sale you should refer to the section entitled Plan of Distribution beginning on page 37 of this prospectus. We will bear all costs relating to the registration of the shares. All selling and other expenses incurred by the Selling Stockholder will be borne by the Selling Stockholder. Our common stock is listed on the Nasdaq Stock Market LLC ( Nasdaq ) under the symbol VORB. On July 25, 2022, the last reported sales price of our common stock was $4.00 per share. INVESTING IN OUR SECURITIES INVOLVES A HIGH DEGREE OF RISK. SEE RISK FACTORS BEGINNING ON PAGE 5 OF THIS PROSPECTUS. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. The date of this prospectus is __________, 2022. CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This prospectus includes statements that express our opinions, expectations, beliefs, plans, objectives, assumptions or projections regarding future events or future results and therefore are, or may be deemed to be, forward-looking statements. These forward-looking statements can generally be identified by the use of forward-looking terminology, including the terms believes, estimates, anticipates, expects, seeks, projects, intends, plans, may or should or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts. They appear in a number of places throughout this prospectus and include statements regarding our intentions, beliefs or current expectations concerning, among other things, our results of operations, financial condition, liquidity, prospects, growth, strategies and the markets in which we operate. Such forward-looking statements are based on available current market material and management s expectations, beliefs and forecasts concerning future events impacting us. Factors that may impact such forward-looking statements include, without limitation: the impact of the COVID-19 pandemic; our ability to maintain an effective system of internal controls over financial reporting; our ability to grow market share in our existing markets or any new markets we may enter; our ability to respond to general economic conditions; our ability to protect against vulnerabilities in our security and cybersecurity systems; our ability to achieve and maintain profitability in the future; our ability to access sources of capital, including debt financing and other sources of capital to finance operations and growth; our ability to maintain and enhance our products and brand, and to attract customers; and our ability to execute our business model, including market acceptance of our planned products and services and achieving sufficient production volumes at acceptable quality levels and prices; the success of strategic relationships with third parties. The foregoing list of factors is not exhaustive. You should carefully consider the foregoing factors and the other risks and uncertainties described in the Risk Factors section of this prospectus. The forward-looking statements contained in this prospectus and any prospectus supplement or document incorporated by reference are based on current expectations and beliefs concerning future developments and their potential effects on us and our business. There can be no assurance that future developments affecting us will be those that we have anticipated. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. Our diverse portfolio is organized across three core offerings: Commercial & Civil: We provide dedicated and rideshare launch services for commercial and civil customers, both from the United States and internationally. This offering also includes civil spaceports, where a foreign nation can buy or lease our mobile launch system ground equipment and we use our aircraft and launch system to provide in-country launch capabilities, allowing these countries to become spacefaring through existing airport infrastructure. National Security and Defense: We provide national security launch and mission services to the U.S. and its allied Government customers, including the Space Force, Air Force and other agencies within the U.S. Department of Defense (the DoD ) and the intelligence community. We also intend to offer government squadron services wherein the entire air-launch system will be a program of record sold to government customers who will own and operate the system directly, providing enhanced flexibility and responsiveness. Additionally, due to the distinct features of LauncherOne, which is itself a hypersonic system, we can also provide solutions for missile defense target applications and other key hypersonic research and development and demonstration activities. Space Solutions: Leveraging existing launch capabilities and our track record as a systems integrator, we seek to provide end-to-end value-added services for Internet of Things ( IoT ) and Earth Observation ( EO ) applications through the combination of agreements with satellite operators and a satellite constellation we will own and operate. Using a satellite-as-a-service model, we plan to deploy our own procured satellites beginning in late 2023 to serve government and commercial customers, both domestically and internationally. Corporate Information and Development The registrant was initially formed on January 11, 2021, as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. From the time of the registrant s formation to the time of the consummation of the transactions described in the following paragraph (the Business Combination ), its name was NextGen Acquisition Corp. II. On August 22, 2021, the registrant entered into a merger agreement (the Merger Agreement ) with Pulsar Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of the registrant ( Merger Sub ), and Vieco USA, Inc. ( Vieco USA ). On December 29, 2021, as contemplated by the Merger Agreement and following approval by the registrant s shareholders at an extraordinary general meeting held December 28, 2021, the registrant filed a notice of deregistration with the Cayman Islands Registrar of Companies, together with the necessary accompanying documents, and filed a certificate of incorporation and a certificate of corporate domestication with the Secretary of State of the State of Delaware, under which the registrant was domesticated and continues as a Delaware corporation, changing its name to Virgin Orbit Holdings, Inc. (the Domestication ). The Business Combination was accounted for as a reverse recapitalization in accordance with ASC 805, Business Combinations. Under this method of accounting, NextGen Acquisition Corp. II was treated as the acquired company for financial reporting purposes. Accordingly, for accounting purposes, the financial statements of the registrant represented a continuation of the financial statements of Vieco USA with the Business Combination treated as the equivalent of Vieco USA issuing shares for the net assets of NextGen Acquisition Corp. II, accompanied by a recapitalization. Risks Associated with Our Business Our business is subject to a number of risks of which you should be aware before making an investment decision. These risks are discussed more fully in the Risk Factors section of this prospectus. These risks include the following: We will require additional financing to expand our operations and grow our business, and a failure to obtain this necessary capital when needed on acceptable terms, or at all, could force us to delay, limit, reduce or terminate our research and development, operations or commercialization efforts, which could have a material adverse effect on our business, financial condition, results of operations and prospects, including the possibility that a lack of funds could cause our business to fail and liquidate with little or no return to investors. The success of our business will be highly dependent on our ability to effectively market and sell our launch services for small low Earth orbit ( LEO ) satellites, our national security and defense services and space solutions, and to convert contracted revenues and our pipeline of potential contracts into actual revenues. The market for launch services for small LEO satellites and space solutions is not well established, is still emerging and may not achieve the growth potential we expect or may grow more slowly than expected. Our ability to grow our business depends on the successful operation and performance of our launch systems and related technology and our ability to introduce new enhancements or services in a timely manner, which are subject to many uncertainties, some of which are beyond our control. We may not be able to convert our contracted revenue or potential contracts into actual revenue. We routinely conduct hazardous operations when testing and launching our rockets, which could result in damage to property or persons. Unsatisfactory performance or failure of our rockets and related technology at launch or during operations could reduce customer confidence and have a material adverse effect on our business, financial condition and results of operations. If we are unable to adapt to and satisfy customer demands in a timely and cost-effective manner, or if we are unable to manufacture our rockets at a quantity and quality that our customers demand, our ability to grow our business may suffer. We may be unable to manage our future growth effectively, which could make it difficult to execute our business strategy. If we commercialize outside the United States, we will be exposed to a variety of risks associated with international operations that could materially and adversely affect our business. The Yorkville Transaction On June 28, 2022, we entered into a securities purchase agreement (the "Securities Purchase Agreement") with the Selling Stockholder pursuant to which we sold and issued to the Selling Stockholder a convertible debenture (the Debenture ) on June 29, 2022, in the principal amount of $50.0 million, which is convertible into shares of our common stock, par value $0.0001 per share subject to certain conditions and limitations set forth in the Securities Purchase Agreement. The Selling Stockholder will use commercially reasonable efforts to convert $2.7 million in each 30-day period beginning on August 28, 2022, provided that the certain conditions are satisfied as of each such period. The Debenture bears interest at an annual rate of 6.0% and has a maturity date of December 29, 2023. The Debenture provides a conversion right, in which any portion of the principal amount of the Debenture, together with any accrued but unpaid interest, may be converted into our common stock at a conversion price equal to the lower of (i) $4.64 or (ii) 95% of the average of the two lowest daily volume weighted average price of the common stock during the three (3) trading days immediately preceding the date of conversion (but not lower than a certain floor price, currently set at $2.52, that is subject to further adjustment in accordance with the terms of the Debenture). The Debenture may not be converted into common stock to the extent such conversion would result in the Selling Stockholder and its affiliates having beneficial ownership of more than 9.99% of our then outstanding shares of Common Stock; provided that this limitation may be waived by the Selling Stockholder upon not less than 65 days prior notice to us. The Debenture provides us, subject to certain conditions, with a redemption right pursuant to which we, upon three (3) business days prior notice to the Selling Stockholder in the case of a partial redemption or ten (10) business days notice in the case of a full redemption, may redeem, in whole or in part, any of the outstanding principal and interest thereon at a redemption price equal to 2.5% of the principal amount being redeemed on or prior to October 1, 2022, and thereafter at a redemption price equal to 5.0% of the principal amount being redeemed. The registration statement of which this prospectus forms a part registers the resale by the Selling Stockholder of up to 20,000,000 shares of common stock that can be issuable upon the conversion of the Debenture.
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: we, us, Company or our company are to Tiga Acquisition Corp. II, a Cayman Islands exempted company; memorandum and articles of association are to our amended and restated memorandum and articles of association to be in effect upon completion of this offering; Companies Act are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; forward purchase agreement are to the agreement that will provide our sponsor or its permitted assignee with an option to subscribe for, in the forward purchaser s sole discretion, the forward purchase securities in one or multiple private placements that will close prior to or concurrently with the closing of our initial business combination; forward purchase securities are to the forward purchase shares and forward purchase warrants; forward purchase shares are to an aggregate of up to 5,000,000 Class A ordinary shares if purchased by our sponsor or its permitted assignee at their option; forward purchase warrants are to an aggregate of up to 1,250,000 warrants to purchase Class A ordinary shares if purchased by our sponsor or its permitted assignee at their option; forward purchaser are to the sponsor or its permitted assignee; founders means Mr. G. Raymond Zage, III and Mr. Ashish Gupta; founder shares are to our Class B ordinary shares initially issued to our sponsor in a private placement prior to this offering and which currently are held by our sponsor (which shares may be transferred to permitted transferees from time to time) and the Class A ordinary shares that will be issued upon the automatic conversion of such Class B ordinary shares at the time of our initial business combination (for the avoidance of doubt, such Class A ordinary shares are not considered public shares for the purposes of this prospectus); IDR refers to Indonesian Rupiah, the lawful currency of Indonesia; initial shareholders are to holders of our founder shares prior to this offering; letter agreement are to a letter agreement, the forms of which are filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team are to our executive officers and directors; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private placement warrants are to the warrants to be issued to our sponsor in a private placement simultaneously with the closing of this offering, and upon conversion of working capital loans, if any; public shareholders are to the holders of our public shares, including our initial shareholders and management team to the extent our initial shareholders and/or members of our management team subscribe for public shares, provided that each initial shareholder s and member of our management team s status as a public shareholder will only exist with respect to such public shares; public shares are to our Class A ordinary shares offered as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public warrants are to our warrants offered as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market; TABLE OF CONTENTS The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED JULY 22, 2022 PRELIMINARY PROSPECTUS $200,000,000 Tiga Acquisition Corp. II 20,000,000 Units Tiga Acquisition Corp. II is a blank check company incorporated as a Cayman Islands exempted company and established for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business combination. We have not selected any potential business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any potential business combination target with respect to an initial business combination with us. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of: one Class A ordinary share and one-quarter of one warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment, terms and limitations as described herein. Only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. The warrants will become exercisable on the later of 30 days after the completion of our initial business combination and 12 months from the closing of this offering, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. The underwriters have a 45-day option from the date of this prospectus to purchase up to 3,000,000 additional units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below calculated as of two business days prior to the consummation of our initial business combination, including interest (which interest shall be net of taxes payable), divided by the number of then outstanding Class A ordinary shares that were sold as part of the units in this offering, which we refer to collectively as our public shares, subject to the limitations described herein. If we have not completed an initial business combination within 24 months from the closing of this offering we will redeem 100% of the public shares for cash, subject to applicable law and certain conditions as further described herein. Our sponsor, Tiga Sponsor II LLC, has agreed to purchase 4,000,000 warrants (or 4,400,000 if the underwriters over-allotment option is exercised in full), each exercisable to purchase one Class A ordinary share at $11.50 per share, at a price of $1.50 per warrant, in a private placement that will close concurrently with the closing of this offering. We refer to these warrants throughout this prospectus as the private placement warrants. Our sponsor and certain of our directors own 5,750,000 Class B ordinary shares (up to 750,000 shares of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised and excluding any adjustment to the outstanding Class B ordinary shares related to the forward purchase agreement described below) which will automatically convert into Class A ordinary shares on the first business day following the completion of our initial business combination as described herein. We will enter into a forward purchase agreement (the forward purchase agreement ) with our sponsor or an affiliate of our sponsor (the forward purchaser ) which will grant the forward purchaser an option to subscribe, in the forward purchaser s sole discretion, for up to 5,000,000 Class A ordinary shares plus up to 1,250,000 warrants to purchase one Class A ordinary share at $11.50 per share, for an aggregate purchase price of up to $50,000,000, or $10.00 per Class A ordinary share, in one or multiple private placements to close prior to or concurrently with the closing of our initial business combination. The terms of the forward purchase agreement will permit the forward purchaser to transfer the rights to purchase the forward purchase securities to third parties. The aggregate proceeds from the sale of securities under the forward purchase agreement will be used by us for purposes related to our initial business combination. The total number of Class B ordinary shares outstanding after this offering and the expiration of the underwriters over-allotment option will equal 20% of the sum of the total number of Class A ordinary shares and Class B ordinary shares outstanding at such time plus the number of Class A ordinary shares to be sold pursuant to a forward purchase agreement that we will enter into with the forward purchaser. The Class B ordinary shares will automatically convert into Class A ordinary shares on the first business day following the completion of our initial business combination on a one-for-one basis, subject to adjustment as described herein. Only holders of Class B ordinary shares will have the right to appoint directors in any election held prior to or in connection with the completion of our initial business combination. On any other matters submitted to a vote of our shareholders, holders of Class B ordinary shares and holders of Class A ordinary shares will vote together as a single class, except as required by law. Currently, there is no public market for our units, Class A ordinary shares or warrants. We expect to have our units listed on the New York Stock Exchange, or NYSE, under the symbol TTO U on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing. We expect the Class A ordinary shares and warrants comprising the units to begin separate trading on the NYSE under the symbols TTO and TTO WS, respectively, on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless the underwriters permit earlier separate trading conditions, subject to our filing a Current Report on Form 8-K with the Securities and Exchange Commission (the SEC ) containing an audited balance sheet of the Company reflecting our receipt of the gross proceeds of this offering and issuing a press release announcing when such separate trading will begin. We are an emerging growth company and smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 36 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Per Unit Total Public offering price $10.00 $200,000,000 Underwriting discounts and commissions(1) $ 0.20 $ 4,000,000 Proceeds, before expenses, to us $9.45 $189,000,000 (1) Does not include certain fees and expenses payable to the underwriters in connection with this offering. See Underwriting beginning on page 158 for a description of underwriting compensation payable to the underwriters. Of the net proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $200.0 million, or $230.0 million if the underwriters over-allotment option is exercised in full ($10.00 per unit in either case), will be deposited into a segregated trust account located in the United States with Continental Stock Transfer & Trust Company acting as trustee and $2,000,000 will be available to pay fees and expenses in connection with the closing of this offering (excluding underwriting commissions) and for working capital following the closing of this offering. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, if any, the funds held in the trust account will not be released until the earliest to occur of: (a) the completion of our initial business combination; (b) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our memorandum and articles of association (i) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering, or (ii) with respect to any other provisions relating to shareholders rights or pre-initial business combination activity; and (c) the redemption of all of our public shares if we have not completed our business combination within 24 months from the closing of this offering, subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2022. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. No offer or invitation to subscribe for securities is being made to the public in the Cayman Islands. Credit Suisse , 2022 TABLE OF CONTENTS sponsor is to Tiga Sponsor II LLC, a Cayman Islands exempted company and an affiliate of our founders; and warrants are to the public warrants, private placement warrants, forward purchase warrants and any other warrants issued pursuant to our warrant agreement. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any forfeiture of ordinary shares described in this prospectus will take effect as a surrender for no consideration of such ordinary shares as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option and accordingly, that our sponsor will forfeit 750,000 of its founder shares following the closing of this offering. TABLE OF CONTENTS We are responsible for the information contained in this prospectus. We have not authorized anyone to provide you with different information, and we take no responsibility for any other information others may give to you. We are not, and the underwriters are not, making an offer to sell securities in any jurisdiction where the offer or sale is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front of this prospectus. TABLE OF CONTENTS Page SUMMARY 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, references to: amended and restated memorandum and articles of association are to our amended and restated memorandum and articles of association to be in effect upon completion of this offering; company, our company, we, or us are to Bridgetown 3 Holdings Limited, a Cayman Islands exempted company; Companies Act are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; and equity-linked securities are to any securities of our company which are convertible into or exchangeable or exercisable for, ordinary shares of our company; founder shares are to our Class B ordinary shares initially purchased by our sponsor in a private placement prior to this offering and, unless the context otherwise requires, our Class A ordinary shares issued upon the conversion thereof as provided herein; FWD are to FWD, a pan-Asian life insurance company majority owned by Pacific Century, which is an affiliate of our sponsor; initial shareholders are to the holders of our founder shares prior to this offering; letter agreement refers to the letter agreement, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team are to our officers and directors; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; Pacific Century are to Pacific Century Group, an affiliate of our sponsor; PineBridge are to PineBridge Investments, an affiliate of both our sponsor and Pacific Century; private placement warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering; public shares are to our Class A ordinary shares offered in this offering (whether they are subscribed for in this offering or thereafter in the open market); public shareholders are to the holders of our public shares; public warrants are to the redeemable warrants sold as part of the public units in this offering (whether they are subscribed for in this offering or in the open market); sponsor are to Bridgetown 3 LLC, a Cayman Islands limited liability company; sponsor affiliates are to certain affiliates of our sponsor who may purchase public units in this offering; Thiel Capital are to Thiel Capital LLC, an affiliate of our sponsor; and warrants are to our redeemable warrants, which include the public warrants as well as the private placement warrants. 1 Table of Contents All references in this prospectus to our shares being forfeited shall take effect as surrenders for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. All references in this prospectus to our share dividends shall take effect as share capitalizations as a matter of Cayman Islands law. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option, and all references to $ are to United States dollars. Registered trademarks referred to in this prospectus are the property of their respective owners. General We are a blank check company incorporated on January 4, 2021 as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have generated no revenues to date and we do not expect that we will generate operating revenues at the earliest until we consummate our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. While we may pursue an acquisition or a business combination target in any business or industry, we intend to focus our search on a target with operations or prospective operations in the technology, financial services, or media sectors, which we refer to as the new economy sectors , in Southeast Asia, although we may also explore compelling opportunities in South Asia. We believe that Southeast Asia is entering a new era of economic growth, particularly in the new economy sectors, which we expect will result in attractive initial business combination opportunities for attractive risk-adjusted returns. We shall not undertake our initial business combination with any entity headquartered in or with its principal business operations in the People s Republic of China (including Hong Kong and Macau). The Association of Southeast Asian Nations, or ASEAN, is made up of countries in Southeast Asia including Indonesia, Thailand, Singapore, Vietnam, the Philippines, Malaysia, Brunei Darussalam, Myanmar, Cambodia and Laos. According to the Economic Intelligence Unit, ASEAN has an estimated population of 659 million and an estimated nominal GDP of approximately $3.2 trillion in 2021. ASEAN remains one of the fastest growing regions in the world, and it is estimated to grow at an average of 4% per annum over the next decade, becoming the fourth-largest economy in the world by 2030 with an estimated GDP of $4.5 trillion and a population size of 723 million, according to World Economic Forum. In particular, collective findings by Google, Temasek (an active global investment company owned by the Government of Singapore) and Bain & Company indicate that the region s internet economy was approximately $170 billion in terms of gross merchandise value (GMV) and is poised to reach to an estimated $360 billion by 2025, and could reach $1 trillion by 2030. As such, GMV of internet economy has reached approximately 5.4% of the total ASEAN nominal GDP in 2021 while it is expected to reach approximately 9.2% by 2025. There were approximately 440 million Internet users in the region in 2021, representing a penetration rate of 75% in the region. In 2021, the Philippines led the region with an estimated 93% year-over-year growth in internet economy in terms of GMV, while Indonesia, Malaysia, Thailand, Singapore and Vietnam were growing by an estimated 31-51% annually. In addition, in 2019, it was estimated that 150 million people in the region will turn 15 years old (the so-called, mobile age ) by 2034. In addition, we believe the Southeast Asian region presents market opportunities in the financial sector. According to an Asian Development Bank report on financial inclusion in Southeast Asia, the gap between needs of the populace and the volume of electronic payment and transfer volumes is estimated to be more than $180 billion in Indonesia, Philippines, Cambodia and Myanmar combined. In addition, in the same set of countries, there is an estimated gap between savings capacity and savings in formal financial institutions of more than $80 billion and gap between credit needs and what is fulfilled by informal lenders is estimated to be approximately $80 billion. There is also low insurance penetration in these markets. For these reasons, we believe that there are significant market opportunities in these segments. In 2021, there were 23 consumer technology companies valued at more than $1 billion in the region, and the new unicorn companies rose from the development of the e-commerce ecosystem and from financial services, according to the collective findings by Google, Temasek and Bain & Company. 2 Table of Contents We believe the growth in these new economy sectors will be driven by private sector expansion, technological innovation, a growing young and middle class population, increasing consumption, structural economic and policy reforms and demographic changes in the region. Our Sponsor Bridgetown 3 LLC, our sponsor, has been formed as a collaboration between Pacific Century and Thiel Capital, with each of Pacific Century and/or its affiliates or related entities, on the one hand, and Thiel Capital and/or its affiliates or related entities, on the other hand, having a 50% economic interest. We may also draw upon the services of PineBridge Investments, an affiliate of Pacific Century. Pacific Century Group Founded by Mr. Richard Li in 1993, Pacific Century is an investment group with experience investing in, building and operating businesses in Financial Services and Technology, Media & Telecommunications (TMT). In 1990, Mr. Li founded Asia s first satellite-delivered cable-TV, Star TV (eventually sold to Rupert Murdoch s News Corp). Mr. Li founded Pacific Century Regional Developments Limited (PCRD) in 1994, with Pacific Century Insurance (PCI) as one of the subsidiaries (sold to Fortis in 2007). In 1999, Mr. Li, through Pacific Century, acquired a substantial interest in PCCW (then known as Tricom Holdings Limited), which currently holds a majority interest in Viu (an OTT video streaming platform in Asia) and HKT (a Hong Kong telecommunications service provider). In 2010, he acquired the global asset manager PineBridge Investments from AIG. PineBridge manages $141.8 billion in assets as of September 30, 2021. The firm s private capital arm has invested in privately held companies, including Legendary Pictures (a film production and entertainment company), FieldTurf (an installer of artificial turf at sports fields), Tensar (a provider of technology driven solutions for soil reinforcement and ground stabilization), Royalty Pharma (an acquiror of pharmaceutical royalties), Sodecia North America (formerly AZ Automotive; a manufacturer and supplier of engineered metal stampings, assemblies and modules for automobile and motor vehicles). In 2013, Mr. Li established FWD, a life insurance company launched in Hong Kong, Macau and Thailand that has since grown to span ten markets across Asia. FWD had total assets of $62.5 billion as of June 30, 2021 through organic growth and a series of acquisitions of insurance businesses from leading insurance companies. Mr. Li was among the earliest investors in Tencent (a public Chinese conglomerate with over $500 billion market capitalization that has major holdings in tech, film, music, and gaming), Sohu (a China-based online media, search and game service company), Sina (a Chinese media and technology company), Hyphen Group (a fintech company in Greater Southeast Asia), and Animoca Brands (a Hong Kong-based digital entertainment, blockchain and gamification company). Mr. Li was also a late stage investor in Chegg (an American education technology company listed on NYSE), 91.com (a Chinese mobile app marketplace and mobile game operator which was subsequently sold to Baidu), PPStream (a Chinese peer-to-peer streaming video network software which was subsequently sold to iQIYI) and GoTo (an e-commerce company merged from Tokopedia and Gojek in Indonesia). Mr. Li was a Hong Kong representative at the APEC Business Advisory Council (ABAC) from 2009 to 2014. Mr. Li is a trustee of the Li Ka-Shing Foundation, one of Asia s most active venture and technology investors. He is also a director of Shantou University and a governor at the ISF Academy, a private school located in Hong Kong. Thiel Capital Thiel Capital is an investment firm founded in 2011 by entrepreneur and investor Peter Thiel. Located in Los Angeles, California, Thiel Capital provides strategic and operational support for a variety of investment initiatives and entrepreneurial endeavors. Thiel Capital and its predecessors have incubated and launched several investment firms now with billions of dollars under management, including Founders Fund, Mithril and Valar Ventures. Numerous other business and philanthropic ventures, including the Thiel Fellowship and Breakout Labs, have also started under the Thiel Capital umbrella. Peter Thiel cofounded PayPal, Inc., an online payments company, where he served as Chief Executive Officer, President and Chairman of the board of directors until the company s initial public offering and subsequent acquisition by eBay in 2002. He made the first outside investment in Meta Platforms, Inc. (formerly Facebook, Inc.), where he serves as a director. Mr. Thiel also cofounded Palantir Technologies Inc. and is Chairman of its board of directors. Mr. Thiel and the investment firms he founded have a track record of investing in frontier technology companies, having provided early-stage funding for LinkedIn, Yelp, Stripe, Brex, Trumid, SoFi, SpaceX, Spotify, Airbnb, Qoo10 and hundreds of other startups. Mr. Thiel is a partner at Founders Fund, a San Francisco-based 3 Table of Contents venture capital firm investing in science and technology companies solving difficult problems. Formed in 2005, Founders Fund has raised eight venture capital funds, manages more than $6 billion in committed capital and has supported many consequential companies, including SpaceX, which designs, manufactures and launches advanced rockets and spacecraft, and Airbnb, an online marketplace for lodging, tourism and experiences. Mr. Thiel also cofounded Mithril, a Texas-based venture capital firm, and Valar Ventures, a New York-based venture capital firm. Thiel Capital and Mr. Thiel are also actively involved in the financial technology space, having provided support for companies such as Brex, a company providing cash management services for growing companies with a focus on start-ups in the life science and e-commerce space, Social Finance, an online personal finance company providing student loan refinancing, and Trumid, an electronic bond trading platform. Mr. Thiel is also the founder and chairman of The Thiel Foundation, which supports science, technology, and long-term thinking about the future. In 2011 Mr. Thiel, through The Thiel Foundation, started the Thiel Fellowship, a two-year program for young people who want to build new things instead of attending college. Fellows receive a $100,000 grant and support from The Thiel Foundation s network of founders, investors and scientists. Past fellows include Vitalik Buterin, co-creator of Ethereum, a global, open-source platform for decentralized applications; Lucy Guo, co-founder of Scale AI, a provider of data to train artificial intelligence applications; Ritesh Agarwal, founder and Chief Executive Officer of OYO Rooms, a hotel chain based in India; and Austin Russell, founder and Chief Executive Officer of Luminar Technologies, Inc., which makes LIDAR equipment and software for the transportation industry. The Thiel Foundation also houses Breakout Labs, which backs scientist entrepreneurs working at the intersections of technology, biology, materials and energy. Investors are cautioned that Thiel Capital and its affiliates or related entities past performance is not necessarily indicative of our future results. In certain circumstances, and subject to, among other things, Thiel Capital s internal policies and procedures, contractual obligations to third parties and applicable laws and regulations, we may seek to draw upon Thiel Capital s network and relationships to provide access to deal prospects because of our management s belief that such network and relationships have produced high-quality, high-value deals and companies in the past, though neither Thiel Capital nor any related entity has any obligation or duty to us or our shareholders, including without limitation any obligation or duty to present us with any opportunity for a potential business combination. We may also potentially benefit from Thiel Capital s network and relationships in identifying companies that may be appropriate acquisition targets; however, neither Thiel Capital nor any of its related entities is obligated to identify any such target companies. Any such activities are solely the responsibility of our management team. While Bridgetown 1 (as defined below) may also seek to draw upon Thiel Capital s network and relationships to provide access to deal prospects, we do not expect there to be much overlap in deal prospects due to the fact that Bridgetown 1 is substantially larger in size than we are. While Bridgetown 2 (as defined below, if it does not successfully consummate its initial business combination with PropertyGuru, also as defined below) may also seek to draw upon Thiel Capital s network and relationships to provide access to deal prospects, the size of the businesses which we target will potentially be smaller than those which are available for Bridgetown 2 to target, as Bridgetown 2 has no limitation, as we do, on the size of additional funds that it can raise through a private offering of debt or equity securities in connection with the completion of its initial business combination. In addition, our independent directors and their network of contacts and affiliations will be entirely different from those of Bridgetown 1 and Bridgetown 2. However, it is still possible that we will compete with Bridgetown 2 to draw upon Thiel Capital s network and relationships to provide access to deal prospects. PineBridge Investments We may also draw upon PineBridge s platforms, infrastructure, personnel, network and relationships to provide access to deal prospects, along with any necessary resources to aid in the identification, diligence, and fundraising of a target for the initial business combination. PineBridge is a private, global asset manager with a focus on active, high conviction investing. PineBridge has approximately 200 investment professionals across asset classes and 25 offices globally, of which 9 are in the Asia-Pacific region. Formerly AIG Investments, PineBridge has been independent and majority-owned by Pacific Century since 2010. It manages over $78.7 billion in Asia (close to 56% of total assets of $141.8 billion under management globally) as of September 30, 2021. We believe that we will benefit from PineBridge s capabilities in alternative strategies where it focuses on select private market opportunities with unrecognized growth potential. We currently anticipate that PineBridge may, from time to time, assist us in the identification of assets or companies that may be appropriate acquisition targets and in unlocking their long-term value. In this respect, none of PineBridge, Pacific Century or Thiel Capital is obligated to identify any such target assets or companies or to perform due diligence on any acquisition targets. Any such activities are solely the responsibility of our management team. 4 Table of Contents Our Past Blank Check Experience Certain of our officers and directors are officers or directors of Bridgetown Holdings Limited (NASDAQ: BTWN; Bridgetown 1 ), a special purpose acquisition company that completed its initial public offering in October 2020 in which it sold units, each consisting of one ordinary share and one-third of one warrant to purchase one ordinary share for an offering price of $10.00 per unit, generating aggregate proceeds of approximately $595,000,000. Bridgetown 1 is currently seeking a target with operations or prospective operations in the technology, financial services, or media sectors in Southeast Asia with which to complete its initial business combination. Certain of our officers and directors are officers or directors of Bridgetown 2 Holdings Limited (NASDAQ: BTNB; Bridgetown 2 ), a special purpose acquisition company that completed its initial public offering in January 2021 in which it sold ordinary shares for an offering price of $10.00 per share, generating aggregate proceeds of approximately $299,000,000. In July 2021, Bridgetown 2 entered into a business combination agreement with PropertyGuru Pte. Ltd. ( PropertyGuru ), a leading Southeast Asian property technology company. Upon closing, the combined company is expected to begin trading on the NYSE. The transaction is currently expected to close in the first quarter of 2022. Our Management Team Our management team is led by Daniel Wong, our Chief Executive Officer, Chief Financial Officer and a Director, Matt Danzeisen, our Chairman, and Jacqueline Thong, our President, who have decades of experience investing in ventures and building companies with operations. Daniel Wong, our Chief Executive Officer, Chief Financial Officer and a Director is a Senior Vice President with Pacific Century. He leads corporate finance (equity and debt), venture investment, and major mergers and acquisitions at Pacific Century, including in respect of its portfolio companies such as FWD (an Asian life insurance company, majority owned by Pacific Century) and PineBridge (a multi-asset manager managing $141.8 billion worldwide as of September 30, 2021, majority-owned by Pacific Century, with a minority interest owned by PineBridge management and employees). Mr. Wong was a Senior Managing Director and a member of the Executive Committee of PineBridge from 2015 to 2016. Prior to joining Pacific Century, Mr. Wong was a manager with the Corporate Finance division of PricewaterhouseCoopers Hong Kong office. Pacific Century established FWD through the acquisition of ING s insurance assets in Hong Kong, Macau and Thailand for $2.1 billion in 2013. Since then, Mr. Wong has raised $6.7 billion of private equity, bank loan and publicly traded fixed income instruments for FWD. Mr. Wong is a member of the board of commissioners of GoTo, formed in 2021 as a result of a merger between Gojek and Tokopedia which are Indonesia s leading e-commerce and on-demand services marketplaces. He led the Series D investment in GoTo on behalf of Pacific Century. He is an investor representative of Tiki, one of Vietnam s leading B2C e-commerce marketplaces. He led the Series D investment in Tiki on behalf of Pacific Century. Mr. Wong led the Series E investment in Chegg (NYSE: CHGG) and was one of Chegg s board members prior to its public listing. Mr. Wong also serves as Chief Executive Officer, Chief Financial Officer and a Director of Bridgetown 1 and Bridgetown 2. Matt Danzeisen, the Chairman of our board of directors, is Head of Private Investments at Thiel Capital, with a primary focus on investments in private companies and funds in the U.S. and Asia. At Thiel Capital, Mr. Danzeisen has developed and led a strategy focused on making debt and equity investments in innovative financial technology companies, funding some of the leading companies in this space and serving on the board of directors of two of them: Trumid, an electronic bond trading platform and Coru, a financial management platform for individuals. In addition, Mr. Danzeisen previously served on the board of directors of Artivest, an alternative investment platform for retail investors and their advisors. Mr. Danzeisen also cofounded Crescendo Equity Partners Limited, or Crescendo, a private equity firm based in South Korea, while at Thiel Capital. Crescendo has raised over $1.5 billion and deployed capital throughout South Korea and Southeast Asia in companies with a technology supply-chain focus. Mr. Danzeisen serves as a member of Crescendo s investment committee and as the firm s representative to selected portfolio companies. Prior to joining Thiel Capital and its predecessor firm, Clarium Capital Management, Mr. Danzeisen was a Vice President and Portfolio Manager at BlackRock in its fixed income division and an investment banker at Banc of America Securities. Mr. Danzeisen also serves as Chairman of Bridgetown 1 and Bridgetown 2. 5 Table of Contents Jacqueline Thong, our President is an Assistant Vice President with Pacific Century, responsible for corporate finance (equity and debt), venture investment, major mergers and acquisitions and Special Purpose Acquisition Company (SPAC) projects, both at Pacific Century and its portfolio companies including FWD. Since 2019, she has managed and executed the raise of over $2 billion of private equity, bank facility and publicly traded fixed income instruments for Pacific Century and FWD. Ms. Thong is a board observer at Tiki, one of Vietnam s leading B2C e-commerce marketplaces. She is also a board observer at GoTo, formed in 2021 as a result of a merger between Gojek and Tokopedia which are Indonesia s leading e-commerce and on-demand services marketplaces. She is an investor representative of Animoca Brands, a digital entertainment, blockchain, and gamification company. She led the investment in Animoca Brands on behalf of Pacific Century. Melissa C. Guzy will serve as one of our independent directors upon the effective date of the registration statement of which this prospectus forms part. She is a Founder and Managing Partner of Arbor Ventures, a venture capital firm focused on financial services. Before founding of Arbor Ventures, Ms. Guzy was a Managing Partner and a member of the Investment Committee at VantagePoint Capital Partners, where she invested in early-stage technology companies in Asia, Europe and Silicon Valley. Her current board positions include the following private companies: Paidy (buy now, pay later for Japan), EverC (cyber intelligence for AML) and TrueAccord (digital debt repayment and collections), InCountry (global data residency compliance solution) and Tabby (buy now, pay later for the Middle East and North Africa) and Fundbox (B2B payments and credit) and Planck Re (data engine for P&C underwriting). Additionally, Ms. Guzy is the Co-Chair of the Hong Kong Venture Capital Association ( HKVCA ) Venture Committee, a member of the Board of Directors of the HKVCA and the Singapore Venture Capital Association and a former member to the Hong Kong SFC on Innovation. Additionally, she has been a guest lecturer on the Venture Capital Industry at the University of Florida, Hong Kong University, Chinese University of Hong Kong and the Hong Kong University of Science and Technology and authored the paper Venture Capital Returns and Public Market Performance. Huey Tyng Ooi will serve as one of our independent directors upon the effective date of the registration statement of which this prospectus forms part. Ms. Ooi has more than 30 years of experience in senior positions at global multinationals, banks, leading payments providers and fintech. She is currently an independent director of the AIG Asia Pacific Insurance Board and a member of the Risk Management Committee and Audit Committee. In addition, she is a member of the Board of Governors of Raffles Institution, a Singapore pre-tertiary institution. From 2018 to end of September 2021, Ms. Ooi held increasingly responsible positions with Grab (NASDAQ: GRAB), an information services and technology company with a focus on Southeast Asia. Ms. Ooi had been a Regional Managing Director, Head of GrabPay from December 2019 to March 2021, where she was responsible for launching and driving adoption of GrabPay across multiple markets in Southeast Asia (including overseeing the strategic direction, regulatory requirements, partnership model and go-to-market plans) for GrabPay. Before joining Grab, she was the Singapore Country Manager of VISA, Inc. (NYSE: V) where she helped drive innovation and digital roadmap. Prior to that, she held various senior leadership positions in Citibank, United Overseas Bank and DBS Bank Limited. Samantha Ghiotti will serve as one of our independent directors upon the effective date of the registration statement of which this prospectus forms part. She has over 20 years of global experience in technology and finance. She is currently the founder and Chief Executive Officer of SJ Mobile Labs a fintech company that provides wealth and protection solutions in Japan. She is also an advisor to Zipmex, a digital assets exchange in South East Asia. She was Deputy Group Chief Executive Officer of Singlife, an insurtech company, where she was responsible for all lines of business, finance, technology, marketing, product, operations, HR, actuary, risk and compliance and was instrumental in its S$3.2 billion sale to a consortium of investors led by TPG in March 2021. Prior to this, she was a partner with Anthemis Group, an investment and advisory fintech firm, with a portfolio of over 100 holdings and 9 exits. She co-founded the advisory group partnering with financial institutions to raise and deploy capital and during her tenure sat on several funds and company boards focused on the fintech, insurtech and healthtech fields, including Anthemis BBVA Ventures, Anthemis Exponential Ventures MMI Holdings, Anthemis Unicredit, Anthemis Baloise, Big Education and Currency Cloud. Prior to this, Ms. Ghiotti spent 10 years in operating roles with large financial institutions building digital businesses and transforming organisations such as American Express (NYSE:AXP), First Data and Royal Bank of Scotland (NYSE:NWG). The past performance of our management team or of Pacific Century, Thiel Capital or PineBridge or their respective affiliates or related entities (including with respect to Bridgetown 1 and Bridgetown 2) is not a guarantee either (i) of success with respect to any business combination we may consummate or (ii) that we will be able to identify 6 Table of Contents a suitable candidate for our initial business combination. Additionally, in the course of their respective careers, our founders and members of our management team and/or their respective affiliates or related entities (including but not limited to Pacific Century, Thiel Capital, PineBridge and their respective affiliates and related entities), have been involved in businesses and deals that were unsuccessful. You should not rely on the historical records or performance of any of the parties listed above as indicative of our future performance. For more information on the experience and background of our management team, see the section entitled Management . Business Strategy Our business strategy is to identify and consummate an initial business combination with a company with operations or prospects in the Southeast Asian or South Asian new economy sector. We intend to focus on companies that complement the experience of our management team and that can benefit from the management team s operational expertise. Our selection process will leverage our management team s and our sponsor s broad and deep network of relationships, industry expertise and proven deal-sourcing capabilities, providing us with a strong pipeline of potential targets. Our management and sponsor have experience in: investing and building businesses in the financial services and technology sectors with unique market, policy and macroeconomic insights; managing and operating companies, setting and changing strategies, and identifying, mentoring and recruiting top-notch talent; developing and growing companies, both organically and inorganically, and expanding the product ranges and geographic footprints of portfolio businesses; executing merger and acquisition strategies to accelerate growth and create integrated value chains; sourcing, structuring, acquiring and selling businesses in various markets; partnering with other industry-leading companies to increase sales and improve the competitive position of companies; fostering relationships with users, sellers, capital providers and target management teams; and accessing the capital markets, including capital sources in Asia and America, across various business cycles, including financing businesses and assisting companies with the transition to public ownership. Business Combination Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, though we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. Companies with operations or prospects in the Southeast Asian and South Asian new economy sectors. Based upon our management team s experience, we believe we will have increased access to investment opportunities and a competitive advantage in our ability to negotiate a business combination with potential targets in the Southeast Asian and South Asian new economy. Our management team s extensive experience and network of contacts provide them with an opportunity to source a target, evaluate a target, consummate a business combination with the target and help grow the target s business. Strong target management teams. We intend to acquire one or more businesses that have strong management teams with a proven track record of driving growth, building long-term competitive advantage and making sound strategic decisions. Fundamentally sound companies that have the potential to further improve their performance under our ownership. We believe our management team s experience in our target sectors as well as their network of industry contacts will create opportunities to enhance the revenue and operational efficiencies of the target business, and potentially generate higher returns for our investors. 7 Table of Contents Market leader. We intend to seek a target that has a leading presence across an industry or segment or has leading technology or product capabilities. Appropriate valuations. We intend to be a disciplined and valuation-centric investor that will invest on terms that we believe are attractive relative to market comparables that provide significant upside potential. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into a business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials, as applicable, that we would file with the SEC. Our Business Combination Process In evaluating a prospective target business, we expect to conduct a thorough due diligence review that will encompass, among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities, as well as reviewing financial and other information that will be made available to us. We will also utilize our operational and capital allocation experience. Our acquisition criteria, due diligence processes and value creation methods are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC. Sourcing of Potential Business Combination Targets We believe that the operational and transactional experience of our management team and members of our sponsor and their respective affiliates and related entities and the relationships they have developed as a result of such experience, will provide us with a substantial number of potential business combination targets. These individuals and entities have developed a broad network of contacts and corporate relationships around the world. This network has grown through sourcing, acquiring and financing businesses and maintaining relationships with sellers, financing sources and target management teams. Our management team and members of our sponsor and their respective affiliates and related entities have significant experience in executing transactions under varying economic and financial market conditions. We believe that these networks of relationships and this experience will provide us with important sources of investment opportunities. In addition, we anticipate that target business candidates may be brought to our attention from various unaffiliated sources, including investment market participants, private equity funds and large business enterprises seeking to divest noncore assets or divisions. We currently anticipate that PineBridge may, from time to time, assist us in the identification of assets or companies that may be appropriate acquisition targets, and while we may also draw upon PineBridge s platforms, infrastructure, personnel, network and relationships to provide access to deal prospects, along with any necessary resources to aid in the identification, diligence, and fundraising of a target for the initial business combination, none of PineBridge, Pacific Century or Thiel Capital is obligated to identify any such target assets or companies or to perform due diligence on any acquisition targets. Any such activities are solely the responsibility of our management team. We are not prohibited from pursuing an initial business combination with a business combination target that is affiliated with our sponsor, officers or directors (or their respective affiliates or related entities) or making the acquisition through a joint venture or other form of shared ownership with our sponsor, officers or directors (or their respective affiliates or related entities). In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors (or their respective affiliates or related entities), we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or an independent accounting firm that our initial business combination is fair to our company 8 Table of Contents from a financial point of view. We are not required to obtain such an opinion in any other context. As more fully discussed in Management Conflicts of Interest, if any of our officers or directors becomes aware of a business combination opportunity that falls within the line of business of any entity to which he or she has then-current fiduciary or contractual obligations (including, but not limited to, Bridgetown 1 and Bridgetown 2, if it does not successfully consummate its initial business combination with PropertyGuru), he or she may be required to present such business combination opportunity to such entity prior to presenting such business combination opportunity to us, subject to his or her fiduciary duties under Cayman Islands law. Our officers and directors currently have certain relevant fiduciary duties or contractual obligations that may take priority over their duties to us (including, but not limited to, Bridgetown 1 and Bridgetown 2, if it does not successfully consummate its initial business combination with PropertyGuru). Other Acquisition Considerations In addition to our sponsor, members of our management team may directly or indirectly own our ordinary shares and/or private placement warrants following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Each of our directors and officers presently has, and in the future any of our directors and our officers may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present acquisition opportunities to such entity (including, but not limited to, Bridgetown 1 and Bridgetown 2, if it does not successfully consummate its initial business combination with PropertyGuru). Accordingly, subject to his or her fiduciary duties under Cayman Islands law, if any of our officers or directors becomes aware of an acquisition opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she will need to honor his or her fiduciary or contractual obligations to present such acquisition opportunity to such entity (including, but not limited to, Bridgetown 1 and Bridgetown 2, if it does not successfully consummate its initial business combination with PropertyGuru), and only present it to us if such entity rejects the opportunity. We do not currently believe, however, that any of the foregoing fiduciary duties or contractual obligations will materially affect our ability to complete our initial business combination. With respect to Bridgetown 1, we do not expect there to be much overlap in business combination opportunities due to the fact that Bridgetown 1 is substantially larger in size than we are. With respect to Bridgetown 2, if it does not successfully consummate its initial business combination with PropertyGuru, while we may seek to raise additional funds through a private offering of debt or equity securities in connection with the completion of our initial business combination, in no event would the cash proceeds of such additional financing exceed $500 million. As such, the size of the businesses which we target will potentially be smaller than those which are available for Bridgetown 2 to target, as Bridgetown 2 has no such limitation. In addition, our independent directors and their network of contacts and affiliations will be entirely different from those of Bridgetown 1 and Bridgetown 2. Our amended and restated memorandum and articles of association will provide that, subject to his or her fiduciary duties under Cayman Islands law, no director or officer shall be disqualified or prevented from contracting with the company nor shall any contract or transaction entered into by or on behalf of the company in which any director shall have an interest be liable to be avoided. A director shall be at liberty to vote in respect of any contract or transaction in which he is interested provided that the nature of such interest shall be disclosed at or prior to its consideration or any vote thereon by the board of directors. We do not believe, however, that any fiduciary duties or contractual obligations of our directors or officers would materially undermine our ability to complete our business combination. In addition, while Pacific Century is an equity owner of PineBridge, Pacific Century does not control the investment activities of PineBridge or its sponsored funds. Any assistance that PineBridge may provide to us, will be subject to, among other things, PineBridge s internal policies and procedures, applicable laws, contractual obligations to third parties and PineBridge s fiduciary obligations to its clients. PineBridge will be under no obligation to provide us with any assistance or to present us with any opportunity for a potential business combination of which they become aware. 9 Table of Contents Certain of our officers and directors are employed by or affiliated with Pacific Century or Thiel Capital. Each of these entities is continually made aware of potential investment opportunities, one or more of which we may desire to pursue for a business combination, but we have not (nor has anyone on our behalf) contacted any prospective target business or had any discussions, formal or otherwise, with respect to a business combination transaction with any prospective target business. Neither Pacific Century nor Thiel Capital has any obligation or duty to us or to our shareholders, including without limitation any obligation or duty to present us with any opportunity for a potential business combination of which they become aware. Our officers and directors may become an officer or director of another special purpose acquisition company with a class of securities registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act even before we enter a definitive agreement regarding our initial business combination. Initial Business Combination NYSE rules require that our initial business combination must occur with one or more operating businesses or assets with a fair market value equal to at least 80% of the net assets held in the trust account (excluding the deferred underwriting commissions and taxes payable) at the time of our signing a definitive agreement in connection with our initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or an independent accounting firm. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. Unless we complete our initial business combination with an affiliated entity, or our board of directors cannot independently determine the fair market value of the target business or businesses, we are not required to obtain an opinion from an independent investment banking firm, another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or from an independent accounting firm that the price we are paying for a target is fair to our company from a financial point of view. If no opinion is obtained, our shareholders will be relying on the business judgment of our board of directors, which will have significant discretion in choosing the standard used to establish the fair market value of the target or targets, and different methods of valuation may vary greatly in outcome from one another. Such standards used will be disclosed in our tender offer documents or proxy solicitation materials, as applicable, related to our initial business combination. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons. However, we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the issued and outstanding capital stock, shares and/or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% fair market value test. If our initial business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the target businesses. If our securities are not listed on the NYSE after this offering, we would not be required to satisfy the 80% requirement. However, we intend to satisfy the 80% requirement even if our securities are not listed on the NYSE at the time of our initial business combination. 10 Table of Contents Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. Corporate Information We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates exceeds $250 million as of the end of the prior June 30th, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates exceeds $700 million as of the prior June 30th. Exempted companies are Cayman Islands companies wishing to conduct business outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received a tax exemption undertaking from the Financial Secretary of the Cayman Islands that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations shall apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax shall be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are a Cayman Islands exempted company incorporated on January 4, 2021. Our executive offices are located at c/o Boundary Hall, Cricket Square, Grand Cayman, KY1-1102, Cayman Islands, and our telephone number is (345) 815-5716. 11 Table of Contents The offering In making your decision whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors beginning on page 34 of this prospectus. Securities offered 20,000,000 units, at $10.00 per unit, each unit consisting of: one Class A ordinary share; and one half of one warrant, each whole warrant exercisable to purchase one Class A ordinary share. Proposed NYSE symbols: Units: BTNC.U Class A Ordinary Shares: BTNC Warrants: BTNC.WS Trading commencement and separation of Class A ordinary shares and warrants The units will begin trading promptly after the date of this prospectus. The Class A ordinary shares and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Citigroup and BTIG inform us of their decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the Class A ordinary shares and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into Class A ordinary shares and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Separate trading of the Class A ordinary shares and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A ordinary shares and warrants be traded separately until we have filed with the SEC a Current Report on Form 8-K which includes an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which is anticipated to take place three business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. 12 Table of Contents Units: Number issued and outstanding before this offering 0 Number issued and outstanding after this offering 20,000,000(1) Ordinary shares: Number issued and outstanding before this offering 5,750,000(2) Number issued and outstanding after this offering 25,000,000(1)(3)(4) Redeemable Warrants: Number issued and outstanding before this offering 0 Number of private placement warrants to be sold in a private placement simultaneously with this offering 7,500,000(1) Number of warrants to be issued and outstanding after this offering and the private placement 17,500,000(1) Exercisability Each unit contains one-half of one warrant. Each whole warrant is exercisable to purchase one of our Class A ordinary shares. Only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. This is different from other offerings similar to ours whose units include one ordinary share and one warrant to purchase one share. We have established the components of the units in this way in order to reduce the dilutive effect of the warrants upon completion of a business combination since the warrants will be exercisable in the aggregate for one half of the number of shares compared to units that each contain a warrant to purchase one whole share, thus making us, we believe, a more attractive merger partner for target businesses. ____________ (1) Assumes no exercise of the underwriters over-allotment option, and gives effect to the full forfeiture of 750,000 founder shares. (2) Consists solely of founder shares and includes up to 750,000 ordinary shares that are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. Except as otherwise specified, the rest of this prospectus has been drafted to give effect to the full forfeiture of these 750,000 ordinary shares. (3) Includes 20,000,000 public shares and 5,000,000 founder shares. (4) Founder shares are classified as Class B ordinary shares, which shares will convert into Class A ordinary shares on a one-for-one basis, subject to adjustment as described below adjacent to the caption Founder shares conversion and anti-dilution. 13 Table of Contents Exercise price $11.50 per share, subject to adjustment as described herein. In addition, if (x) we issue additional Class A ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per Class A ordinary share (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or such affiliates, as applicable, prior to such issuance) (the Newly Issued Price ), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our Class A ordinary shares during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the Market Value ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price described below under Redemption of warrants will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. Exercise period The warrants will become exercisable on the later of: 30 days after the completion of our initial business combination, and 12 months from the closing of this offering; provided in each case that we have an effective registration statement under the Securities Act covering the ordinary shares issuable upon exercise of the warrants and a current prospectus relating to them is available (or we require holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). We are not registering the Class A ordinary shares issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable, but in no event later than 15 business days after the closing of our initial business combination, we will use our best efforts to file, and within 60 business days following our initial business combination to have declared effective, a registration statement covering the Class A ordinary shares issuable upon exercise of the warrants, and to maintain a current prospectus relating to those Class A ordinary shares until the warrants expire or are redeemed. No warrants will be exercisable for cash unless we have an effective and current registration statement covering the Class A ordinary shares issuable upon exercise of the warrants and a current prospectus relating to such Class A ordinary shares. Notwithstanding the foregoing, if a registration statement covering the Class A ordinary shares issuable upon exercise of the warrants is not effective within a specified period following the consummation of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to the exemption provided by Section 3(a)(9) of the Securities Act provided that such exemption is available. If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a cashless basis. 14 Table of Contents Notwithstanding the above, if our Class A ordinary shares are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, and in the event we do not so elect, we will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption of warrants Once the warrants become exercisable, we may redeem the issued and outstanding warrants (except as described herein with respect to the private placement warrants as described in this prospectus): in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period; and if, and only if, the last sale price of our Class A ordinary shares equals or exceeds $18.00 per share (as adjusted for share subdivisions, share consolidations, share capitalizations, rights issuances, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. We will not redeem the warrants unless a registration statement under the Securities Act covering the Class A ordinary shares issuable upon exercise of the warrants is effective and a current prospectus relating to those ordinary shares is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may not exercise our redemption right if the issuance of shares upon exercise of the warrants is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect such registration or qualification. We will use our best efforts to register or qualify such shares under the blue sky laws of the state of residence in those states in which the warrants were offered by us in this offering. 15 Table of Contents If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In determining whether to require all holders to exercise their warrants on a cashless basis, our management will consider, among other factors, our cash position, the number of warrants that are issued and outstanding and the dilutive effect on our shareholders of issuing the maximum number of Class A ordinary shares issuable upon the exercise of our warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of Class A ordinary shares equal to the quotient obtained by dividing (x) the product of the number of Class A ordinary shares underlying the warrants, multiplied by the excess of the fair market value (defined below) over the exercise price of the warrants by (y) the fair market value. The fair market value shall mean the average reported last sale price of the Class A ordinary shares for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Please see the section entitled Description of Securities Redeemable Warrants Public Shareholders Warrants for additional information. None of the private placement warrants will be redeemable by us. Appointment of directors; voting rights Prior to our initial business combination, only holders of Class B ordinary shares will have the right to vote on the appointment of directors. Holders of our Class A ordinary shares will not be entitled to vote on the appointment of directors during such time. On any other matters submitted to a vote of our shareholders, holders of the Class B ordinary shares and holders of the Class A ordinary shares will vote together as a single class, except as required by law. These provisions of our amended and restated memorandum and articles of association may only be amended by a special resolution passed by at least 90% of our ordinary shares voting in a general meeting. With respect to any other matter submitted to a vote of our shareholders, including any vote in connection with our initial business combination, except as required by law, holders of our founder shares and holders of our public shares will vote together as a single class, with each share entitling the holder to one vote. 16 Table of Contents Founder shares In February 2021, our sponsor purchased an aggregate of 7,475,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.003 per share. In May 2021, our sponsor transferred 947,097 founder shares to our Chief Executive Officer, 299,241 founder shares to an affiliate of our sponsor and 5,000 founder shares to each of our independent director nominees. In January 2022, our sponsor forfeited 1,436,806 founder shares, our Chief Executive Officer forfeited 219,000 founder shares and an affiliate of our sponsor forfeited 69,194 founder shares, resulting in an aggregate 5,750,000 founders shares outstanding, of which 750,000 are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. The founder shares held by our independent director nominees shall not be subject to forfeiture in the event the over-allotment option is not exercised. Prior to the initial investment in the company of $25,000 by our sponsor, the company had no assets, tangible or intangible. The purchase price of the founder shares was determined by dividing the amount of cash contributed to us by the number of founder shares issued. Our initial shareholders will own 20% of our issued and outstanding shares after this offering (assuming they do not purchase units in this offering). If we increase or decrease the size of the offering, we will effect a capitalization or share surrender or redemption or other appropriate mechanism, as applicable, with respect to our Class B ordinary shares immediately prior to the consummation of the offering in such amount as to maintain the ownership of founder shares by our initial shareholders at 20% of our issued and outstanding ordinary shares upon the consummation of this offering. The founder shares are identical to the Class A ordinary shares being issued in this offering, except that: only holders of the founder shares have the right to vote on the appointment of directors prior to our initial business combination; the founder shares are subject to certain transfer restrictions, as described in more detail below; our sponsor, officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association that would (i) modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering or (ii) with respect to the other provisions relating to shareholders rights or pre-business combination activity, unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares; 17 Table of Contents our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed (i) to waive their redemption rights with respect to their founder shares and public shares in connection with the completion of our initial business combination and (ii) to waive their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within 24 months from the closing of this offering (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). If we submit our initial business combination to our public shareholders for a vote, our sponsor has agreed, pursuant to such letter agreement, to vote their founder shares and any public shares purchased during or after this offering in favor of our initial business combination (as a result, in addition to our initial shareholder s founder shares, we would need only 7,500,001, or 37.50%, of the 20,000,000 public shares issued in this offering to be voted in favor of a transaction (assuming all issued and outstanding shares are voted) in order to have our initial business combination approved (assuming the over-allotment option is not exercised); in the event the minimum number of shares are present for a quorum, we would need only 1,250,001, or 6.25%, of the 20,000,000 public shares issued in this offering to be voted in favor of a transaction in order to have our initial business combination approved (assuming the over-allotment option is not exercised). the founder shares will automatically convert into our Class A ordinary shares at the time of our initial business combination on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, or to the terms of our initial business combination agreement, in each case as described in more detail below and in our amended and restated memorandum and articles of association; and the founder shares are subject to registration rights. Transfer restrictions on founder shares Our sponsor has agreed not to transfer, assign or sell any of its founder shares and any Class A ordinary shares issuable upon conversion thereof except to certain permitted transferees until the earlier to occur of: (A) one year after the completion of our initial business combination or (B) the date on which we complete a liquidation, merger, share exchange, reorganization or other similar transaction after our initial business combination that results in all of our public shareholders having the right to exchange their ordinary shares for cash, securities or other property (except as described herein under Principal Shareholders Transfers of Founder Shares and Private Placement Warrants ). Any permitted transferees will be subject to the same restrictions and other agreements of our initial shareholders with respect to any founder shares. We refer to such transfer restrictions throughout this prospectus as the lock-up. 18 Table of Contents Notwithstanding the foregoing, if the last sale price of our ordinary shares equals or exceeds $12.00 per share (as adjusted for share subdivisions, share consolidations, share capitalizations, rights issuances, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, the founder shares will be released from the lock-up. Founder shares conversion and anti-dilution rights We have issued 5,750,000 Class B ordinary shares, par value $0.0001 per share. Unless otherwise provided in our initial business combination agreement, the Class B ordinary shares will automatically convert into Class A ordinary shares at the time of our initial business combination, on a one-for-one basis, subject to adjustment for share subdivisions, share consolidations, share capitalizations, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein and in our amended and restated memorandum and articles of association. In the case that additional Class A ordinary shares, or equity-linked securities, are issued or deemed issued in excess of the amounts sold in this offering and related to the closing of our initial business combination, the ratio at which the Class B ordinary shares shall convert into Class A ordinary shares will be adjusted (unless the holders of a majority of the issued and outstanding Class B ordinary shares agree to waive such anti-dilution adjustment with respect to any such issuance or deemed issuance) so that the number of Class A ordinary shares issuable upon conversion of all Class B ordinary shares will equal, in the aggregate, 20% of the sum of all ordinary shares issued and outstanding upon completion of this offering plus all Class A ordinary shares and equity-linked securities issued or deemed issued in connection with our initial business combination, excluding any shares or equity-linked securities issued, or to be issued, to any seller in our initial business combination and any private placement-equivalent warrants issued to our sponsor or its affiliates upon conversion of loans made to us. Holders of founder shares may also elect to convert their Class B ordinary shares into an equal number of Class A ordinary shares, subject to adjustment as provided above, at any time. The term equity-linked securities refers to any debt or equity securities that are convertible, exercisable or exchangeable for our Class A ordinary shares issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt. Securities could be deemed issued for purposes of the conversion adjustment if such shares are issuable upon the conversion or exercise of convertible securities, warrants or similar securities. Private Placement Warrants: Each private placement warrant is exercisable to purchase one Class A ordinary share at $11.50 per share, subject to adjustment as provided herein. The purchase price of the private placement warrants will be added to the net proceeds from this offering to be held in the trust account pending our completion of our initial business combination. If we do not complete our initial business combination within 24 months from the closing of this offering, the proceeds of the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares (subject to the requirements of applicable law) and the private placement warrants will expire worthless. The private placement warrants will not be redeemable by us and may be exercised on a cashless basis. 19 Table of Contents The private placement warrants (including the Class A ordinary shares issuable upon exercise of the private placement warrants) will not be transferable, assignable or saleable until 30 days after the completion of our initial business combination, except as described herein under Principal Shareholders Transfers of Founder Shares and Private Placement Warrants. Following the expiration of the lock-up described under Principal Shareholders Transfers of Founder Shares and Private Placement Warrants with respect to the private placement warrants and their underlying securities, the private placement warrants and their underlying securities will be transferable, assignable or salable, subject to an effective registration statement covering such securities or an applicable exemption from registration. The rights associated with the private placement warrants will not at any time change based on the nature of the holder. Proceeds to be held in trust account NYSE rules provide that at least 90% of the gross proceeds from this offering and the sale of the private placement warrants be deposited in a trust account. Of the net proceeds we will receive from this offering and the sale of the private placement warrants described in this prospectus, $202,000,000 ($10.10 per unit), or $232,300,000 ($10.10 per unit) if the underwriters over-allotment option is exercised in full, will be deposited into a segregated trust account located in the United States with Continental Stock Transfer & Trust Company acting as trustee and $1.5 million will be used to pay expenses in connection with the closing of this offering and for working capital following this offering. The proceeds to be placed in the trust account include $7,000,000 (or up to $ 8,050,000 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions. The funds in the trust account will be invested only in specified U.S. government treasury bills or in specified money market funds. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, if any, the proceeds from this offering and the sale of the private placement warrants will not be released from the trust account until the earliest of (i) the completion of our initial business combination, (ii) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association to (A) modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering or (B) with respect to any other provision relating to shareholders rights or pre-business combination activity and (iii) the redemption of all of our public shares if we are unable to complete our initial business combination within 24 months from the closing of this offering, subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. 20 Table of Contents Anticipated expenses and funding sources Unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use, except the withdrawal of interest to pay taxes. Based upon current interest rates, we expect the trust account to generate approximately $40,400 of interest annually (assuming no exercise of the underwriters overallotment option and an interest rate of 0.02% per year) following the investment of such funds in specified U.S. government treasury bills or in specified money market funds. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement warrants not held in the trust account, which will be approximately $995,000 in working capital after the payment of approximately $505,000 in expenses relating to this offering; and any loans or additional investments from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation to advance funds or invest in us, and provided any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of a business combination. Conditions to completing our initial business combination NYSE rules require that our initial business combination must occur with one or more operating businesses or assets with a fair market value equal to at least 80% of the net assets held in the trust account (excluding the deferred underwriting commissions and taxes payable) at the time of our signing a definitive agreement in connection with our initial business combination. If our securities are not listed on the NYSE after this offering, we would not be required to satisfy the 80% requirement. However, we intend to satisfy the 80% requirement even if our securities are not listed on the NYSE at the time of our initial business combination. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or an independent accounting firm. We will complete our initial business combination only if the post-transaction company in which our public shareholders own shares will own or acquire 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our initial business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% fair market value test, provided that in the event that our initial business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the target businesses. 21 Table of Contents Permitted purchases of public shares and warrants by our affiliates If we seek shareholder approval of our initial business combination and we do not conduct redemptions or repurchases in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, officers, or their respective affiliates may purchase shares in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Please see Proposed Business Permitted purchases of our securities for a description of how such persons will determine which shareholders to seek to acquire shares from. There is no limit on the number of shares such persons may purchase, or any restriction on the price that they may pay. Any such price per share may be different than the amount per share a public shareholder would receive if it elected to redeem its shares in connection with our initial business combination. However, such persons have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. In the event our sponsor, directors, officers, or their respective affiliates determine to make any such purchases at the time of a shareholder vote relating to our initial business combination, such purchases could have the effect of influencing the vote necessary to approve such transaction. None of the funds in the trust account will be used to purchase shares in such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. Subsequent to the consummation of this offering, we will adopt an insider trading policy which will require insiders to: (i) refrain from purchasing shares during certain blackout periods and when they are in possession of any material non-public information and (ii) to clear all trades with our legal counsel prior to execution. We cannot currently determine whether our insiders will make such purchases pursuant to a Rule 10b5-1 plan, as it will be dependent upon several factors, including but not limited to, the timing and size of such purchases. Depending on such circumstances, our insiders may either make such purchases pursuant to a Rule 10b5-1 plan or determine that such a plan is not necessary. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Our sponsor, directors, officers, or their respective affiliates will not make any purchases if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. Redemption rights for public shareholders upon completion of our initial business combination We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares, subject to the limitations described herein. 22 Table of Contents The amount in the trust account is initially anticipated to be $10.10 per public share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. The redemption rights will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination. Manner of conducting redemptions We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a general meeting called to approve the business combination or (ii) by means of a tender offer. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under the law or stock exchange listing requirement. Asset acquisitions and share purchases would not typically require shareholder approval, while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our issued and outstanding ordinary shares or seek to amend our amended and restated memorandum and articles of association would require shareholder approval. We currently intend to conduct redemptions or repurchases in connection with a shareholder vote unless shareholder approval is not required by applicable law or stock exchange listing requirement and we choose to conduct redemptions or repurchases pursuant to the tender offer rules of the SEC for business or other legal reasons. So long as we obtain and maintain a listing for our securities on the NYSE, we will be required to comply with such rules. If shareholder approval of the transaction is required by law or stock exchange listing requirement, or we decide to obtain shareholder approval for business or other legal reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and file proxy materials with the SEC. 23 Table of Contents We expect that a final proxy statement would be mailed to public shareholders at least 10 days prior to the shareholder vote. However, we expect that a draft proxy statement would be made available to such shareholders well in advance of such time, providing additional notice of redemption if we conduct redemptions or repurchases in conjunction with a proxy solicitation. Although we are not required to do so, we currently intend to comply with the substantive and procedural requirements of Regulation 14A in connection with any shareholder vote even if we are not able to maintain our NYSE listing or Exchange Act registration. If we seek shareholder approval, we will complete our initial business combination only if we obtain the approval of an ordinary resolution under Cayman Islands law, being the affirmative vote of a majority of the ordinary shares represented in person or by proxy and entitled to vote thereon and who vote at a general meeting in favor of the business combination (or, if the applicable rules of the NYSE then in effect require, a majority of the outstanding ordinary shares held by public shareholders are voted in favor of the business transaction). Unless restricted by NYSE rules, a quorum for such meeting will consist of the holders present in person or by proxy of outstanding shares of the company representing a majority of the voting power of all outstanding shares of our company entitled to vote at such general meeting. Unless restricted by NYSE rules, our initial shareholders will count toward this quorum. In such case, pursuant to the terms of a letter agreement entered into with us, our sponsor, officers and directors have agreed (and their permitted transferees will agree) to vote any founder shares held by them and any public shares purchased during or after this offering in favor of our initial business combination. We expect that at the time of any shareholder vote relating to our initial business combination, our initial shareholders and their permitted transferees will own at least 20% of our issued and outstanding ordinary shares entitled to vote thereon. Each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction. If a shareholder vote is not required and we do not decide to hold a shareholder vote for business or other legal reasons, we will, pursuant to our amended and restated memorandum and articles of association: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Upon the public announcement of our initial business combination, if we elect to conduct redemptions or repurchases pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase our Class A ordinary shares in the open market, in order to comply with Rule 14e-5 under the Exchange Act. 24 Table of Contents In the event we conduct redemptions or repurchases pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering more than a specified number of public shares, which number will be based on the requirement that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. If public shareholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination. Our amended and restated memorandum and articles of association will provide that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions. Redemptions of our public shares may also be subject to a higher net tangible asset test or cash requirement pursuant to an agreement relating to our initial business combination. For example, the proposed business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration we would be required to pay for all ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all ordinary shares submitted for redemption will be returned to the holders thereof. Tendering share certificates in connection with a tender offer or redemption rights We may require our public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to either tender their certificates (if any) to our transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up to two business days prior to the vote on the proposal to approve our initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically using The Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option, rather than simply voting against the initial business combination. The tender offer or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public shareholders to satisfy such delivery requirements. 25 Table of Contents Limitation on redemption rights of shareholders holding more than 15% of the shares sold in this offering if we hold shareholder vote Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions or repurchases in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering. We may waive this restriction in our sole discretion. We believe the restriction described above will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our sponsor or its affiliates to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us or our sponsor or its affiliates at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Our sponsor, officers and directors have, pursuant to a letter agreement entered into with us, waived their right to have any founder shares or public shares held by them redeemed in connection with our initial business combination. Unless any of our other affiliates acquires founder shares through a permitted transfer from an initial shareholder, and thereby becomes subject to the letter agreement, no such affiliate is subject to this waiver. However, to the extent any such affiliate acquires public shares in this offering or thereafter through open market purchases, it would be a public shareholder and subject to the 15% limitation in connection with any such redemption right. 26 Table of Contents Redemption Rights in connection with proposed amendments to our amended and restated memorandum and articles of association Our amended and restated memorandum and articles of association will provide that any of its provisions, including those related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the private placement warrants into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public shareholders as described herein and in our amended and restated memorandum and articles of association, but excluding the provision of the articles relating to the appointment of directors), may be amended if approved by holders of at least two-thirds of our ordinary shares who attend and vote in a general meeting, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of 65% of our ordinary shares. Should our initial shareholders vote all their shares in favor of any such amendment, we would require 11,666,667, or 58.33% of the public shares issued in this offering to be voted in favor of any such amendment for its approval (assuming no exercise of the underwriters overallotment option and no purchase by our sponsor or its affiliates or our officers and directors or their respective affiliates of public shares in this offering or thereafter). We may not issue additional securities that can vote on amendments to our amended and restated memorandum and articles of association or in our initial business combination. Our initial shareholders, which will beneficially own 20% of our ordinary shares upon the closing of this offering (assuming they do not purchase public shares in this offering), will participate in any vote to amend our amended and restated memorandum and articles of association and/or trust agreement and will have the discretion to vote in any manner it chooses. Our sponsor, officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association that would (i) modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering or (ii) with respect to the other provisions relating to shareholders rights or pre-business combination activity, unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares and public shares in connection with the completion of our initial business combination. 27 Table of Contents Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, all amounts held in the trust account will be released to us, other than funds the trustee will use to pay amounts due to any public shareholders who exercise their redemption rights as described above under Redemption rights for public shareholders upon completion of our initial business combination. We will use the remaining funds to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our sponsor, officers, and directors have agreed that we will have only 24 months from the closing of this offering to complete our initial business combination. If we are unable to complete our initial business combination within such 24-month period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable, and less up to $100,000 of interest to pay dissolution expenses) divided by the number of then issued and outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within the 24-month time period. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within 24 months from the closing of this offering. However, if our sponsor, officers or directors acquire public shares after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted 24-month time frame. The underwriters have agreed to waive their rights to their deferred underwriting commission held in the trust account in the event we do not complete our initial business combination within 24 months from the closing of this offering and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. 28 Table of Contents Our sponsor, officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association that would (i) modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering or (ii) with respect to the other provisions relating to shareholders rights or pre-business combination activity, unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares. However, we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions. Limited payments to insiders There will be no finder s fees, reimbursements or cash payments made to our sponsor, officers or directors, or our or their affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination, other than the following payments, none of which will be made from the proceeds of this offering and the sale of the private placement warrants held in the trust account prior to the completion of our initial business combination: repayment of an aggregate of up to $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; reimbursement for certain out-of-pocket expenses related to identifying, investigating and completing an initial business combination; repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants issued to our sponsor; and At the closing of our initial business combination, we may pay a customary financial consulting fee to our sponsor and/or affiliates of our sponsor. We may pay such financial consulting fee in the event such party or parties provide us with specific target company, industry, financial or market expertise, as well as insights, relationships, services or resources that we believe are necessary in order to assess, negotiate and consummate an initial business combination. The amount of any such financial consulting fee we pay will be based upon the prevailing market for similar services for comparable transactions at such time, and will be subject to the review of our audit committee pursuant to the audit committee s policies and procedures relating to transactions that may present conflicts of interest. 29 Table of Contents These payments may be funded using the net proceeds of this offering and the sale of the private placement warrants not held in the trust account or, upon completion of the initial business combination, from any amounts remaining from the proceeds of the trust account released to us in connection therewith. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliates. Audit committee Prior to the effectiveness of this registration statement, we will have established and will maintain an audit committee (which will be composed entirely of independent directors), to among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled Management Committees of the Board of Directors Audit Committee. Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party (other than our independent public accounting firm) for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (i) $10.10 per public share or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes. This liability will not apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third party claims. Because we are a blank check company, rather than an operating company, and our operations will be limited to searching for prospective target businesses to acquire, the only third parties we currently expect to engage would be vendors such as lawyers, investment bankers, computer or information and technical services providers or prospective target businesses. We have not independently verified whether our sponsor has sufficient funds to satisfy their indemnity obligations and believe that our sponsor s only assets are securities of our company. We have not asked our sponsor to reserve for such obligations. 30 Table of Contents Conflicts of Interest Pacific Century and Thiel Capital and/or their respective affiliates or related entities each may manage or oversee several investment vehicles, including Bridgetown 1 and Bridgetown 2. Although we do not believe any conflict currently exists between us and such entities except for Bridgetown 1 and Bridgetown 2, if it does not successfully consummate its initial business combination with PropertyGuru, investment vehicles managed by Pacific Century, Thiel Capital and/or their respective affiliates or related entities may compete with us for business combination or investment opportunities. If these investment vehicles decide to pursue any such opportunity, we may be precluded from procuring such opportunities. In addition, investment ideas generated within Pacific Century or Thiel Capital and/or their respective affiliates or related entities may be suitable for both us and for their respective current or future investment vehicles and may be directed to such investment vehicles rather than to us. Neither Pacific Century nor Thiel Capital has any obligation or duty to us or to our shareholders, including without limitation any obligation or duty to present us with any opportunity for a potential business combination of which they become aware. Pacific Century and Thiel Capital and/or their respective affiliates or related entities may be required to present potential business combinations to their respective affiliates or third parties before they present such opportunities to us, and may have similar obligations to future investment vehicles or third parties. Risks We are a blank check company incorporated as a Cayman Islands exempted company that has conducted no operations and has generated no revenues. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision whether to invest in our securities, you should take into account not only the background of our management team, but also the special risks we face as a blank check company. This offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see Proposed Business Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419. You should carefully consider these and the other risks set forth in the section of this prospectus entitled Risk Factors. 31 Table of Contents Summary financial data The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. As of December 31, 2021 (Actual) Balance Sheet Data: Working capital (deficit) $ (239,695 ) Total assets 345,841 Total liabilities 331,330 Shareholders equity $ 14,511 32 Table of Contents
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+II-2 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form F-1 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in Shenzhen, Guangdong Province, China, on January 19, 2022. Aspire Global Inc. By: /s/ Tuanfang Liu Name: Tuanfang Liu Title: Chief Executive Officer Pursuant to the requirements of the Securities Act of 1933, as amended, this amended Registration Statement has been signed by the following persons in the capacities and on the dates indicated. Signature Title Date /s/ Tuanfang Liu Chairman and Chief Executive Officer January 19, 2022 Tuanfang Liu (Principal Executive Officer) /s/ Michael Wang Chief Financial Officer January 19, 2022 Michael Wang (Principal Financial and Accounting Officer) /s/ Jiangyan Zhu Director January 19, 2022 Jiangyan Zhu SIGNATURE OF AUTHORIZED REPRESENTATIVE IN THE UNITED STATES Pursuant to the Securities Act of 1933, as amended, the undersigned, the duly authorized representative in the United States of Aspire Global Inc. has signed this registration statement or amendment thereto in Newark, Delaware on January 19, 2022. Puglisi & Associates By: /s/ Donald J. Puglisi Name: Donald J. Puglisi Title: Managing Director II-3
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus before investing. References in this prospectus to we, us or our company refer to GigCapital6, Inc. References in this prospectus to our public shares are to shares of our Common Stock sold as part of the public units in this offering (whether they are purchased in this offering or thereafter in the open market) and references to public stockholders refer to the holders of our public shares, including our Sponsor (as defined below), executive officers and directors to the extent they purchase public shares, provided that their status as public stockholders shall only exist with respect to such public shares. References in this prospectus to permitted transferees refer to permitted transferees as described under section Principal Stockholders of this prospectus. References in this prospectus to our management or our management team refer to our directors and executive officers, references to our Sponsor refer to GigAcquisitions6, LLC, a company affiliated with our executive officers, directors and our other advisors and references to our combined team refer to our management team and our other advisors, collectively. References in this prospectus to insider shares refer to 15,000 shares of Common Stock granted to Mr. Weightman and ICR prior to this offering. References in this prospectus to promissory note refer to an amended and restated promissory note dated as of December 10, 2021 issued by the Company to the Sponsor. Unless we tell you otherwise, the information in this prospectus assumes that the underwriter will not exercise its over-allotment option. You should rely only on the information contained in this prospectus. We have not, and the underwriter has not, authorized anyone to provide you with different information. We are not, and the underwriter is not, making an offer of these securities in any jurisdiction where the offer is not permitted. Private-to-Public Equity (PPE)TM and Mentor-InvestorTM are trademarks of GigFounders, LLC, an affiliate of our Sponsor, and all are used pursuant to an agreement. General We are a newly organized Private-to-Public Equity (PPE) company, also known as a blank check company or special purpose acquisition company, incorporated in Delaware and formed for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any specific business combination target. To date, our efforts have been limited to organizational activities as well as activities related to this offering. Our efforts to identify a prospective target business will not be limited to a particular industry or geographic region, although we intend to focus on companies in the TMT, cloud connectivity, artificial intelligence, machine learning, big data analytics, aerospace and defense, biotechnology, medical technology, pharmatech, medical equipment, semiconductors, cybersecurity, privacy and sustainable industries. Our Sponsor and its principals may from time to time become aware of potential business opportunities, one or more of which we may desire to pursue, for a business combination, but from the date of our incorporation through the date of this prospectus, there have been no substantive discussions, directly or indirectly, between any of our officers, directors, promoters and other affiliates on our behalf and any of their contacts or relationships regarding a potential initial business combination with our company. Additionally, we have not engaged or retained any agent or other representative to identify or locate any suitable acquisition candidate for us. We will seek to capitalize on the significant experience and contacts of our management team to complete our initial business combination. We are one of seven SPACs affiliated with GigCapital Global, with the other six being GigCapital, Inc. ( GIG1 ), which successfully completed its business combination with Kaleyra, Inc. (NYSE American: KLR) in November 2019, GigCapital2, Inc. ( GIG2 ), which successfully completed its Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED JANUARY 27, 2022 $200,000,000 GigCapital6, Inc. 20,000,000 Units GigCapital6, Inc., a Delaware corporation (the Company ), is a newly organized Private-to-Public Equity (PPE) company, also known as a blank check company or special purpose acquisition company ( SPAC ), formed by an affiliate of the serial SPAC issuer GigCapital Global, for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any specific business combination target. To date, our efforts have been limited to organizational activities as well as activities related to this offering. Our efforts to identify a prospective target business will not be limited to a particular industry or geographic region, although we intend to focus on companies in the technology, media, and telecommunications ( TMT ), cloud connectivity, artificial intelligence, machine learning, big data analytics, aerospace and defense, biotechnology, medical technology, pharmatech, medical equipment, semiconductors, cybersecurity, privacy and sustainable industries. This is an initial public offering of our securities. We are offering 20,000,000 units at an offering price of $10.00 each. Each unit consists of one share of our common stock, par value $0.0001 per share ( Common Stock ), and one half (1/2) of one redeemable warrant. We refer herein to the units sold in this offering as our public units, and the components thereof as our public shares and public warrants, respectively. Each whole warrant entitles the holder to purchase one share of Common Stock at a price of $11.50 per share. Each warrant will become exercisable on the later of 30 days after the completion of our initial business combination, or 12 months from the closing of this offering and will expire on the fifth anniversary of the completion of our initial business combination, or earlier upon redemption or liquidation as described in this prospectus. Warrants will only be exercisable for whole shares. As a result, you must purchase at least two units in order to validly exercise your warrants. We have also granted our underwriter, Wells Fargo Securities, LLC ( Wells Fargo Securities ), a 45-day option to purchase up to an additional 3,000,000 units solely to cover over-allotments, if any. We will provide the purchasers of our public units, or our public stockholders, with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below as of 2 business days prior to the consummation of the initial business combination, including interest (which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares, subject to the limitations described herein. The amount in the trust account will initially be $10.15 per public share and such amount will be increased by $0.033 per public share for each optional one-month extension (or by $0.10 per public share for a one-time quarterly extension) of our time to consummate our initial business combination, as described herein. If we are unable to complete our initial business combination within 15 months from the closing of this offering, we will redeem 100% of the public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including the interest (which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares, subject to applicable law and as further described herein. However, if we anticipate that we may not be able to consummate our initial business combination within 15 months, we may, but are not obligated to, extend the period of time to consummate a business combination three times by an additional one month each time or one time by an additional calendar quarter (for a total of up to 18 months to complete a business combination); provided that at the beginning of each one-month extension, our Sponsor, as defined below, (or its designees), in exchange for a non-interest bearing, unsecured promissory note, must deposit into the trust account funds equal to thirty-three hundredths of one percent Table of Contents business combination with UpHealth Holding, Inc. and Cloudbreak Health, LLC (NYSE: UPH) in June 2021, GigCapital3, Inc. ( GIG3 ), which successfully completed its business combination with Lightning Systems, Inc. (doing business as Lightning eMotors) (NYSE: ZEV) in May 2021, GigCapital4, Inc. ( GIG4 ), which successfully completed its business combination with BigBear.ai Holdings, LLC in December 2021 (NYSE: BBAI), GigInternational1, Inc. (Nasdaq: GIW) ( GigInternational1 ), which completed its initial public offering in May 2021 and is now engaged in intensive efforts of searching and screening companies worldwide, and GigCapital5, Inc. (NYSE: GIA) ( GIG5 ), which completed its initial public offering in September 2021 and is now engaged in intensive efforts of searching and screening companies worldwide. We believe our management team s distinctive background and record of acquisition and operational success could have a significant impact on target businesses. Although we may pursue our initial business combination in any business, industry or geographic location, we currently intend to focus on opportunities to capitalize on the ability of our management team, particularly our executive officers, to identify, acquire and operate a business with a goal of reaching an enterprise value of over $400 million in the TMT, cloud connectivity, artificial intelligence, machine learning, big data analytics, aerospace and defense, biotechnology, medical technology, pharmatech, medical equipment, semiconductors, cybersecurity, privacy and sustainable industries. As the megatrends involving these industries have a profound impact on the global economy and will shape the world of tomorrow, we intend to target companies around the world focused on digital transformation, cloud connectivity, artificial intelligence, machine learning, big data analytics, aerospace and defense, biotechnology, medical technology, pharmatech, medical equipment, semiconductors, cybersecurity, privacy and sustainability, creating new strategic, operational and business opportunities. Expansion of digital transformation and automation requires safer and more secured networks to reduce vulnerability to security risks from Internet-connected and wireless devices. Distributed ledgers technologies like blockchain are becoming an integral part of today s complex network infrastructure, which affects the existing array of cyber solutions, introducing new programs and security features, such as real-time threat intelligence, security orchestration and automation, advanced endpoint protection, identity and access management and other advanced technologies prompted in large part by a threefold growth in cloud services. Urban population is expected to increase from today s 53% to 70% by 2050. Based on United Nations data, overall growth of the world s population will add close to 2.5 billion people to urban areas by 2050.1 The number of new mega-cities will increase rapidly, particularly in developing countries, requiring massive investments in smart and sustainable city infrastructures. These trends will be further emphasized and challenged by the ongoing demographic shift and new population age structure. In addition, climate change and consequent environmental and social impacts are some of the world s greatest concerns. The United Nations Sustainable Development Goals and the Paris Climate Agreement are driving the agenda and world s efforts toward a green economy and sustainable solutions.2 Consumer sensitivity to sustainable-marketed products grew substantially in the last 5 years, representing today more than 50% of total Consumer Packaged Goods (CPG) market growth.3 Capital allocation in funds embracing Environmental, Social and Governance principles reached record numbers in the last few years.4 Another megatrend is that data has become many enterprises most valuable asset. Digital transformation, built on cloud-based platforms and enabled with new technologies, including AI, the internet of things (IoT), mobile and robotics, offer companies across all industries new opportunities to drive new business models, with the scalability, flexibility, agility, and dynamism heretofore infeasible. These transformations, in turn, are powering the movements to address the other megatrends. The focus of global growth has been shifting. Developing countries, particularly in Asia Pacific and Latin America, are starting to bring their economies to the forefront of interlinked global trade and 1 Report of the UN Economist Network for the UN 75th Anniversary Sept. 2020. 2 UN Framework Convention on Climate Change-FCC/CP/2-15/L.9/Rev1. 3 New York University, Stern School of Business, Center for Sustainable Business. Research on 2015-2020 IRI Purchasing Data Reveals Sustainability Drives Growth, Survives the Pandemic, July 2020. 4 Blackrock-Sustainability: The tectonic shift transforming investing, Feb. 2020. Table of Contents (0.33%) of the gross proceeds of the offering (including such proceeds from the exercise of the underwriter s over-allotment option, if exercised) for each one-month extension of the time period to complete our initial business combination, or if we decide to extend the period of time to consummate a business combination one time by an additional calendar quarter, at the beginning of such extension, our Sponsor (or its designees), in exchange for a non-interest bearing, unsecured promissory note, must deposit into the trust account funds equal to one tenth of one percent (0.10%) of the gross proceeds of the offering (including such proceeds from the exercise of the underwriter s over-allotment option, if exercised). Our sponsor, GigAcquisitions6, LLC, a Delaware limited liability company ( Sponsor ), has committed pursuant to a written agreement to purchase an aggregate of up to 800,000 units (or up to 850,000 units if the underwriter s over-allotment option is exercised in full), at $10.00 per unit in a private placement that will close simultaneously with this offering. Each such unit consists of one share of our Common Stock and one half (1/2) of one redeemable warrant. We refer to these units throughout this prospectus as the private units and the shares of Common Stock included therein as the private shares, and the warrants therein as the private warrants. A portion of the proceeds from the sale of the private units will be placed in the trust account described below. In February 2021, our Sponsor purchased 10,047,500 shares of Common Stock, or founder shares, from us for an aggregate purchase price of $25,000, or $0.0024882 per share. Prior to the consummation of this offering, our Sponsor expects to surrender 4,312,500 founder shares for no consideration, so that upon such surrender, the Sponsor will hold 5,735,000 founder shares, of which up to 750,000 founder shares are subject to forfeiture depending on the extent to which the underwriter s over-allotment option is exercised during this offering. The proceeds from the sale of the founder shares will not be placed in the trust account described below. Our Sponsor is sometimes referred to in this prospectus as our Founder. Prior to the consummation of this offering, we will issue 5,000 shares of Common Stock to Brad Weightman, our Treasurer and Chief Financial Officer, and 10,000 shares of Common Stock to Interest Solutions, LLC, a Connecticut limited liability company and an affiliate of ICR, LLC, an investor relations firm providing services to the Company (collectively with Interest Solutions, LLC, ICR and together with Mr. Weightman and the Founder, the initial stockholders ) (such shares issued to Mr. Weightman and ICR, the insider shares ), in each case, solely in consideration of future services. The 5,000 insider shares granted to Mr. Weightman, our Treasurer and Chief Financial Officer, will be subject to forfeiture and cancellation in the event Mr. Weightman resigns or is removed for cause from his position with the Company prior to the consummation of our initial business combination, but are not otherwise subject to forfeiture. The 10,000 insider shares granted to ICR are not subject to forfeiture. Certain individuals and investment funds that are members of our Sponsor or their affiliates may choose to purchase units in this offering at the offering price; however no members of our Sponsor are obligated to do so and no members of our Sponsor will forfeit any economic or other interest in our Sponsor if they do not purchase units in this offering. To the extent that any such member of our Sponsor or its affiliates has expressed to us an interest to purchase units in this offering at the offering price, we have not directed the underwriter to make any particular allocation to such party. Furthermore, because any expressions of interest are not binding agreements or commitments to purchase, such parties may determine to purchase more, fewer or no units in this offering or the underwriter may determine to sell more, fewer or no units to any such party. For a discussion, see Summary The Offering Expressions of Interest. There is presently no public market for our units, Common Stock or warrants. We intend to apply to list our units on the New York Stock Exchange ( NYSE ) under the symbol GIF.U on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on the NYSE. The shares of Common Stock and the warrants constituting the public units will begin separate trading on the 52nd day following the date of this prospectus, unless the underwriter determines that an earlier date is acceptable, and subject to our filing a Current Report on Form 8-K with the U.S. Securities and Exchange Commission (the SEC ) containing an audited balance sheet of the Company reflecting our receipt of the gross proceeds of this offering and issuing a press release announcing when such separate trading will begin. Once the securities comprising the units begin separate trading, we expect that shares of our Common Stock and public warrants will be listed on the NYSE under the symbols GIF and GIF.WS, respectively. We are an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 and will therefore be subject to reduced public company reporting requirements. Table of Contents investment flows. The emerging markets are not only transitioning to more consumption-oriented economies but also starting to export capital and innovation. Enterprises that are prepared and able to adapt and capitalize on the evolving global competitive landscape will be the winners of the 21st century. Our focus will be on companies with sustainable business and solid corporate governance that may have high impact on the world s Sustainable Development Goals (SDG) and are determined to better society and the environment. Our team will apply our unique Mentor-Investor philosophy to partner with our late-stage growth, high quality targets where we can offer financial, operational, and executive mentoring in order to accelerate their growth and development, organically and strategically, from a privately held entity to a fast growing publicly traded company. Our Mentor-Investor approach can be broken down into several phases: Inception. This phase usually lasts up to 2 months and entails incorporating a SPAC and bringing on a Private-to-Public (PPE) management team that includes TMT experts, entrepreneurs, and executive operators. During this phase, a blank check company also secures a sponsorship team composed of wealthy individuals in the TMT sector, family offices, institutional buyers, private equity firms, and hedge funds. In launching an initial public offering ( IPO ), the SPAC management pays the most attention to forming an IPO book to ensure a solid balance of fundamental equity investors. Searching. The search for a financially viable target ready to become a public company may take 3 to 6 months. Our search for a potential business combination usually focuses on the TMT sector and other diversified verticals nationally and worldwide. Following our Mentor-Investor playbook, as we seek to identify high potential, mutually interested targets for future Private-to-Public (PPE) platforms and other portfolio companies of GigCapital Global, we screen thousands of companies from public databases. As an example, for GIG2 and GIG3, we studied approximately 5,500 potential business combinations. In determining whether a company may become our initial business combination, we look at the target s prospects as a public company, consider potential avenues for exit and financing, and if the company is supported by an entrepreneurial management team and technology-oriented owners. Engagement. The next step is negotiation and execution of a letter of intent. It may take from 2 to 4 weeks, and another 4 to 6 weeks are required to conduct due diligence review and sign a binding definitive agreement. Closing. Following entry into the binding definitive agreement, the target must deliver audited financial statements as required to enable us to file all necessary SEC filings and obtain SEC clearance of these filings in a process that may take 3 to 6 months. During this phase, to the extent not yet done, we also need to secure financing through back-stop lenders or fundamental equity investors and ensure compliance with the minimum listing conditions (e.g., maintaining a market-cap, providing a required float and secure minimum round-lot stockholders), before closing the business combination. With the support of our TMT investors, underwriters, legal counsel, accounting, investment and commercial banking firms, research analysts, investor and public relations, and human resources firms, we create a one-stop-shop or an IPO in a Box to ensure the successful path to becoming a public company. Growth and Exit. The final phase may last from 1 to 5 years, during which we invest our time and resources in expanding and growing the business. We actively participate in meetings of the board of directors and strategic advisory board, provide continuous financing and M&A advisory support for growth, geographic expansion and consolidation, and prepare the business combination for de-SPAC. The SPAC structure is designed to create a public currency for future growth rather than a liquidity event for investors or founders. We intend to target companies in the TMT, cloud connectivity, artificial intelligence, machine learning, big data analytics, aerospace and defense, biotechnology, medical technology, pharmatech, medical equipment, semiconductors, cybersecurity, privacy and sustainable industries anywhere in the world that embrace today s digital transformation and intelligent automation as a competitive advantage. Being conscientious corporate citizens, we will focus on sustainable technology companies that can shape a better society and healthier environment. We believe that such an approach enables both organic and inorganic fast-paced growth, creating Table of Contents Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 44 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Price to Public Underwriting Discount(1) Proceeds, Before Expenses, to us Per Unit $ 10.00 $ 0.65 $ 9.35 Total $ 200,000,000 $ 13,000,000 $ 187,000,000 (1) $0.20 per unit sold in the base offering, or $4,000,000 in the aggregate, is payable upon the closing of this offering. Includes $0.45 per unit sold in the base offering, or $9,000,000 in the aggregate, payable to the underwriter for deferred underwriting commissions to be placed in a trust account located in the United States and released to Wells Fargo Securities, LLC for its own account only upon the completion of an initial business combination. If the underwriters over-allotment option is exercised, $0.65 per over-allotment unit, or up to an additional $1,950,000 or $10,950,000 in the aggregate if the underwriter s over-allotment option is exercised in full, will be deposited in the trust account as deferred underwriting commissions and released to Wells Fargo Securities, LLC for its own account only upon completion of an initial business combination. As described elsewhere in this prospectus, the deferred underwriting commissions will be payable to the underwriter upon completion of the initial business combination as consideration for certain services to be performed by them. The underwriter will receive compensation in addition to the underwriting discount. See Underwriting. Upon consummation of the offering, $10.15 per public unit sold in this offering (whether or not the over-allotment option has been exercised in full or part) will be deposited into a segregated trust account located in the United States with Continental Stock Transfer & Trust Company acting as trustee. Except as described in this prospectus, these funds will not be released to us until the earlier of (1) the completion of our initial business combination within the required time period or (2) our redemption of 100% of the outstanding public shares if we have not completed an initial business combination in the required time period. The underwriter is offering the public units on a firm commitment basis. The underwriter expects to deliver the public units to purchasers on or about , 2022, subject to customary closing conditions. Sole Book-Running Manager Wells Fargo Securities The date of this prospectus is , 2022 Table of Contents new strategic, operational and business opportunities fueled by emerging cloud, analytics, big data, and cognitive technologies. Businesses who rethink their current and future capabilities amid disruption will be better positioned for growth in the digital age. We intend to evaluate both private and public companies as potential initial business combination targets, focusing on opportunities that we believe would provide appropriate risk adjusted returns to stockholders. Following our initial business combination, our objective will be to implement or support the acquired company s operating strategies and actively partner with management to provide it with a seamless and smooth introduction to its public market operations, in order to generate additional value for stockholders. General goals will include enhancement of organic growth efficiencies, total global operations improvements, and additional acquisitions to support a roll-up in an attempt to establish an industry-leading platform in the selected emerging market vertical. Our management team has significant hands-on experience helping TMT, cloud connectivity, artificial intelligence, machine learning, big data analytics, aerospace and defense, biotechnology, medical technology, pharmatech, medical equipment, semiconductors, cybersecurity, privacy and sustainable companies optimize their existing and new growth initiatives by exploiting insights from rich data assets that already exist within most TMT, cloud connectivity, artificial intelligence, machine learning, big data analytics, aerospace and defense, biotechnology, medical technology, pharmatech, medical equipment, semiconductors, cybersecurity, privacy and sustainable companies. Further, we intend to share best practices and key learnings, gathered from our management team s operating and investing experience, as well as strong relationships in the TMT, cloud connectivity, artificial intelligence, machine learning, big data analytics, aerospace and defense, biotechnology, medical technology, pharmatech, medical equipment, semiconductors, cybersecurity, privacy and sustainable industries, to help shape corporate strategies. Additionally, our management team has operated and invested in leading global TMT, cloud connectivity, artificial intelligence, machine learning, big data analytics, aerospace and defense, biotechnology, medical technology, pharmatech, medical equipment, semiconductors, cybersecurity, privacy and sustainable companies across their corporate life cycles and has developed deep relationships with key large multi-national organizations and investors. We believe that these relationships and our management team s know-how present a significant opportunity to help drive strategic dialogue, access new customer relationships and achieve global ambitions to unlock value through the combination closing, as well as following the completion of our initial business combination for a horizon of 3-5 years. Over the last several years, there has been an increase in private equity and venture-backed capital invested in TMT companies. PricewaterhouseCoopers LLP ( PwC ) estimates that US-based venture-backed companies raised nearly $130 billion in 2020, up 14% year-over-year from 2019, despite the impacts of COVID-19.5 Cybersecurity startups have raised a record $11.4 billion in disclosed equity funding in 2020 a nearly 50% increase from 2018.6 Because venture-backed technology companies raise significantly more capital prior to an IPO, the majority now reach unicorn status before even going public,7 and as a result, in 2021, we similarly expect to see that TMT companies becoming public via a traditional IPO will also primarily be mega unicorns. In this market environment, blank check companies are well positioned to provide a benefit of a public listing to private companies. The U.S. capital market was remarkably active in 2020. The total number of U.S. initial public offerings ( IPOs ) in 2020 was approximately 407, which raised a total of $145.3 billion compared to $56.2 billion collected by 195 companies in 2019.8 2020 was a record-breaking year for SPAC IPOs, as 248 IPOs raised $83.4 billion,9 which is 60.9% of all U.S. IPOs by deal number and 57.4% by proceeds. As a result of the increased number of blank check company IPOs, they represented a larger percentage of the IPOs in 2020 than in the prior ten years and have become a strong alternative for liquidity. According to the PwC report, the IPO market was dominated by life science and technology companies, which represented 5 PwC / CBInsights MoneyTree Report Q4 2020. 6 CBInsights Report; Cloud Security Sprints Ahead in 2021. January 2021 7 CBInsights, The 2020 Tech IPO Pipeline. 8 PwC, 2020 Annual Capital Markets Watch. 9 SPAC Research Newsletter, Jan 4, 2021. Compare to EY, Global IPO Trends: Q4 2020, which estimates that 248 SPAC IPOs raised 80.9 billion in 2020. Table of Contents We are responsible for the information contained in this prospectus. We have not authorized anyone to provide any information or to make any representations other than those contained in this prospectus. We and the underwriter take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date. TABLE OF CONTENTS Page Summary 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and articles of association are to the amended and restated memorandum and articles of association of the Company in place upon the consummation of this offering; assets under management or AUM are to assets managed by Oaktree and a proportionate amount ($27.5 billion) of the AUM reported by DoubleLine Capital LP ( Doubleline ), in which Oaktree owns a 20% minority interest (Oaktree s methodology for calculating AUM includes (i) the net asset value (NAV) of assets managed directly by Oaktree, (ii) the leverage on which management fees are charged, (iii) undrawn capital that Oaktree is entitled to call from investors in Oaktree funds pursuant to their capital commitments, (iv) for collateralized loan obligation vehicles ( CLOs ), the aggregate par value of collateral assets and principal cash, (v) for publicly-traded business development companies, gross assets (including assets acquired with leverage), net of cash, and (vi) Oaktree s pro rata portion (20%) of the AUM reported by DoubleLine Capital. This calculation of AUM is not based on the definitions of AUM that may be set forth in agreements governing the investment funds, vehicles or accounts managed and is not calculated pursuant to regulatory definitions); Companies Act are to the Companies Act (as amended) of the Cayman Islands; Founders are to Patrick McCaney, Alexander Taubman, Zaid Pardesi and Mathew Pendo, senior investment professionals of Oaktree; founder shares are to our Class B ordinary shares initially issued to our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination (for the avoidance of doubt, such Class A ordinary shares will not be public shares ); management or our management team are to our executive officers and directors; Oaktree are to Oaktree Capital Management, L.P., an affiliate of our sponsor, and its affiliates where applicable; ordinary resolution are to a resolution adopted by the affirmative vote of at least a majority of the votes cast by the holders of the issued shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private placement warrants are to the warrants to be issued to our sponsor in a private placement simultaneously with the closing of this offering and upon conversion of working capital loans, if any; Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED FEBRUARY 4, 2022 Oaktree Acquisition Corp. III $225,000,000 22,500,000 Units Oaktree Acquisition Corp. III is a newly formed blank check company incorporated as a Cayman Islands exempted company and formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. While we will not be limited to a particular industry or geographic region, given the experience of our management team and Oaktree Capital Management, L.P., our acquisition and value creation strategy will be to identify, acquire, and build a company in the industrial and consumer sectors. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share and one-third of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment, terms and limitations as described herein. The underwriters have a 45-day option from the date of this prospectus to purchase up to 3,375,000 additional units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination, subject to the limitations described herein. If we are unable to consummate an initial business combination within 18 months from the closing of this offering, we may, but are not obligated to, extend the period of time to complete a business combination two times by an additional three months each time (for a total of up to 24 months to complete a business combination). In order to extend the time available for the Company to consummate the initial Business Combination, the Sponsor or its affiliates or designees, upon five business days advance notice prior to each deadline, must deposit into the Trust Account an additional $0.10 per share of Class A ordinary shares then outstanding (in each case, $2,250,000, or up to $2,587,500 if the underwriters over-allotment option is exercised in full) on or prior to the date of such deadline. At the end of the applicable period or any other approved extension of such period, if we are unable to consummate an initial business combination, we will redeem 100% of the public shares for cash, subject to applicable law and certain conditions as described herein. Notwithstanding the foregoing, in the case of the first three month extension period, if the Company has entered into a binding agreement with a business combination target and such transaction has been publicly announced, our sponsor will not be required to contribute the Extension Consideration solely with respect to that extension period. The per-share price upon such redemption will be payable in cash and will equal the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to fund our working capital and regulatory compliance requirements and other costs related thereto, subject to an annual limit of $300,000 and/or to pay our income taxes, if any (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions as described herein. In connection with any extension of the period of time that we have to complete our initial business combination, our public shareholders will not be entitled to vote or to redeem their shares. This feature is different from some other special purpose acquisition companies in which any extension of the company s period to complete an initial business combination would require a vote of the company s shareholders and, in connection with such vote, shareholders would have the right to redeem their public shares, in each case, in accordance with its amended and restated memorandum and articles of association. Our sponsor has agreed to purchase 7,333,333 warrants (or 8,233,333 warrants if the underwriters over-allotment option is exercised in full), each exercisable to purchase one Class A ordinary share at $11.50 per share, at a price of $1.50 per warrant, in a private placement to occur concurrently with the closing of this offering. Our sponsor currently owns 6,468,750 Class B ordinary shares which will automatically convert into Class A ordinary shares at the time of our initial business combination as described herein. Prior to our initial business combination, only holders of our Class B ordinary shares will be entitled to vote on the election of directors. Currently, there is no public market for our securities. We intend to apply to list our units on the New York Stock Exchange, or NYSE, under the symbol OACC.U We expect the Class A ordinary shares and warrants comprising the units to begin separate trading on the NYSE under the symbols OACC and OACC WS, respectively, on the 52nd day following the date of this prospectus unless the underwriters permit earlier separate trading and we have satisfied certain conditions. We are an emerging growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 40 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 225,000,000 Underwriting discounts and commissions(1)(2) $ 0.55 $ 12,375,000 Proceeds, before expenses, to us $ 9.45 $ 212,625,000 (1) Includes $0.35 per unit, or $7,875,000 in the aggregate (or $9,056,250 in the aggregate if the underwriters over-allotment option is exercised in full), payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein and released to the underwriters only upon the consummation of an initial business combination. See also Underwriting for a description of compensation payable to the underwriters. (2) Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $229,500,000, or $263,925,000 if the underwriters over-allotment option is exercised in full ($10.20 per unit in either case), will be deposited into a trust account with Continental Stock Transfer & Trust Company acting as trustee. Except with respect to interest earned on the funds held in the trust account that may be released to us to fund our working capital and regulatory compliance requirements and other costs related thereto, subject to an annual limit of $300,000 and/or to pay our income taxes, if any, the funds held in the trust account will not be released until the earliest to occur of: (a) the completion of our initial business combination; (b) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (i) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of the Class A ordinary shares if we have not consummated an initial business combination within 18 months (or 21 months or 24 months, as applicable) from the closing of the initial public offering or (ii) with respect to any other provisions of the amended and restated memorandum and articles of association relating to holders of our Class A ordinary shares; and (c) the redemption of all of our public shares if we have not completed our business combination within 18 months (or 21 months or 24 months, as applicable) from the closing of this offering, subject to applicable law. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , . Joint Book-Running Managers Deutsche Bank Securities Credit Suisse Morgan Stanley Co-Managers Academy Securities AmeriVet Securities Ramirez & Co., Inc. Tigress Financial Partners LLC <R> February 4, 2022 </R> Table of Contents public shares are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders are to the holders of our public shares, including our sponsor and management team to the extent our sponsor and/or members of our management team purchase public shares, provided that our sponsor s and each member of our management team s status as a public shareholder will only exist with respect to such public shares; special resolution are to a resolution adopted by the affirmative vote of at least a two-thirds (2/3) majority (or such higher threshold as specified in the company s amended and restated articles of association) of the votes cast by the holders of the issued shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter; sponsor are to Oaktree Acquisition Holdings III, L.P., a Cayman Islands exempted limited partnership; and we, us, company or our company are to Oaktree Acquisition Corp. III, a Cayman Islands exempted company. Any forfeiture of shares described in this prospectus will take effect as a surrender of shares for no consideration as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. General We are a blank check company newly incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not identified any potential business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any potential business combination target. While we may pursue an acquisition opportunity in any business industry or sector, we intend to capitalize on the ability of our management team to identify, acquire and manage a business in the industrial and consumer sectors that can benefit from our differentiated and proprietary deal flow, leading brand name and global network. Furthermore, we believe that our management team is positioned to drive ongoing value creation post-business combination, as our team has done with investments in the industrial, consumer and other sectors over time. We believe our management team is well suited to identify opportunities that have the potential to generate attractive risk-adjusted returns for our shareholders. Our sponsor is an affiliate of Oaktree, a registered investment adviser with global investment experience. Through our affiliation with Oaktree, we intend to capitalize on the ability of the Oaktree platform in the industrial and consumer sectors. Given Oaktree s global reach and experience, we believe our team has the required investment, operational, diligence Table of Contents and capital raising expertise to effect a business combination with an attractive target and to position it for long-term success in the public markets. Oaktree Oaktree is a leading global investment management firm headquartered in Los Angeles, California, with over 1,000 employees throughout offices in 19 cities worldwide. As of September 30, 2021, Oaktree had approximately $158 billion in assets under management (including $27.5 billion attributable to Oaktree s 20% minority interest in DoubleLine). Oaktree s senior executives and investment professionals have focused on less efficient markets and alternative investments for the past 36 years. Oaktree emphasizes a value-oriented approach to deploying capital in control investing, listed equities, and other alternative investment strategies. Oaktree s primary firm wide goal is to achieve attractive returns while effectively managing global risk and focusing on opportunistic situations across a wide variety of asset classes and market sectors. Oaktree believes that it can achieve this goal by taking advantage of market inefficiencies in which financial markets and their participants fail to accurately value assets or fail to make available to companies the capital that they reasonably require. Oaktree believes that its defining characteristic is its adherence to the highest professional standards, which has yielded several important benefits. Most importantly, Oaktree believes this characteristic has allowed Oaktree to attract and retain a talented group of investment professionals, while being viewed as a partner of choice for potential investment opportunities. We believe that the breadth of the Oaktree platform and the collective expertise of our management team will allow us to identify numerous initial acquisition targets across the industrial, consumer, and other sectors. Our multi-decade track record of successful investing in both public and private markets gives us differentiated access and insights into a deep network of institutional investors worldwide, as well as a diversified portfolio of lending relationships. Our client base includes leading pension plans, insurance companies, endowments, foundations and sovereign wealth funds. Furthermore, Oaktree expects to leverage strong relationships with banks and other financial institutions as well as brokers and attorneys. This network of contacts is instrumental in obtaining access to investment opportunities, some of which are made available to Oaktree on a highly selective, and in some cases an exclusive, basis. Value Equity Team Oaktree s Value Equity team seeks to produce superior risk-adjusted returns by investing in high-conviction private and public equity investments and has generated strong absolute and relative performance since inception. This team managed Oaktree Acquisition Corp., a special purpose acquisition company ( OAC ), that completed its initial business combination with Hims, Inc. on January 20, 2021 ( HIMS ) (NYSE:HIMS), and manages Oaktree Acquisition Corp. II, a special purpose acquisition company ( OACB ) (NYSE:OACB), that announced an initial business combination with Alvotech Holdings S.A. ( Alvotech ) on December 7, 2021, which transaction is expected to close in the first half of 2022. Oaktree Acquisition Corp. III will be a natural extension of this team s day-to-day business and benefit from the proprietary deal flow the team sources, both internally, from other groups across the global Oaktree platform, and externally, from our breadth of industry relationships. We believe the Value Equity team s capabilities and experience managing OAC and OACB will complement Oaktree Acquisition Corp. III and demonstrate the team s resources required to effect a successful business combination. In addition, we are well positioned to source additional funding in the capital markets, as required. Table of Contents Portfolio manager Patrick McCaney and his team launched the Value Equities strategy in 2012, employing Oaktree s balance sheet, and subsequently opened the strategy to Oaktree clients in 2014 with the launch of the Value Equity Fund, L.P. (the Value Equity Fund ), anchored by approximately $95 million of Oaktree employee and general partner capital (including sizable personal investments by Howard Marks and Bruce Karsh, the co-founders of Oaktree). As of September 30, 2021, the Value Equities strategy managed $867 million of assets, and is still comprised of a high percentage of Oaktree employee capital. Mr. McCaney has built out a skilled team of investment analysts possessing significant equity and cross-capital structure experience, each of whom adheres to Oaktree s value investing philosophy. The team engages in private equity-style in-depth business, financial and legal due diligence on every investment, before acquiring a meaningful ownership stake that it intends to hold onto long-term. Given its highly-concentrated portfolio, the team applies a hands-on approach with every investment whereby they work closely with management teams to grow their businesses over time, supported by Oaktree and the Value Equity team s public markets sponsorship and resources. The team regularly influences board decisions of portfolio companies and has experience influencing board compositions. Furthermore, the Value Equity team has extensive experience working with company management of both public and private businesses, across market capitalizations and industries. Oaktree s global platform, which offers significant differentiation relative to competitors, provides the Value Equity team and will provide our company with key structural and operational advantages. We expect to (i) leverage Oaktree s research capabilities and industry expertise, including a multi-million dollar annual research budget and over 300 investment professionals, (ii) access extensive deal flow from institutional client relationships, banks and brokers, (iii) attract talented investment professionals and advisors, (iv) enjoy increased influence with company boards and management teams, (v) seek restructuring advice if necessary from investment professionals managing over $37 billion in distressed strategies as of September 30, 2021, and (vi) leverage Oaktree s extensive infrastructure, including over 700 back-office employees. Moreover, the Value Equity team is particularly well positioned within Oaktree to manage the day-to-day efforts of our company given its experience managing OAC and OACB and its deep understanding of the public markets and how to tailor transactions that best position private companies to succeed as long-term public companies. See Risk Factors Risks Relating to Our Securities Past performance by Oaktree or its affiliates, including our management team, may not be indicative of future performance of an investment in us. Our Founders, Our Board of Directors and Management Patrick McCaney serves as a director on our board of directors. Mr. McCaney currently serves as the Chief Executive Officer of OACB and a director of its board of directors, and was formerly the Chief Executive Officer of OAC and a director on its board of directors until its business combination with HIMS. In addition, he has served as portfolio manager for Oaktree s Value Equities strategy since its inception. Mr. McCaney oversees the analysis, portfolio construction and management of the Value Equities strategy. Since joining Oaktree in 2012, he has led more than 40 public and private investments across a variety of sectors. Prior to joining Oaktree, Mr. McCaney spent more than seven years as an investment professional for the Special Situations Group of Goldman, Sachs & Co., where he originated, executed and managed investments of Goldman s proprietary capital. Mr. McCaney earned a master s degree in electrical engineering as well as B.S. degrees in electrical engineering and management science from the Massachusetts Institute of Technology. Table of Contents Alexander Taubman is Chief Executive Officer of Oaktree Acquisition Corp. III. Mr. Taubman currently serves as the President of OACB and served in the same role for OAC until its business combination with HIMS. He is also a managing director within Oaktree s Value Equities strategy, which he helped launch. Mr. Taubman contributes to the analysis, portfolio construction and management of the Value Equities strategy. He has led public and private investments in consumer, industrial, media, financials and various other sectors. Prior to joining Oaktree in 2014, Mr. Taubman was an investment professional in the Special Situations Group at Goldman, Sachs & Co., where he originated, executed, and managed investments of Goldman s balance sheet capital. Mr. Taubman serves as a Trustee of Heckscher Foundation for Children, as well as the Museum of Contemporary Art Detroit. He earned an A.B. degree in economics from Harvard College, as well as an M.B.A. from Harvard Business School. Zaid Pardesi is President and Chief Financial Officer of Oaktree Acquisition Corp. III. Mr. Pardesi currently serves as the Chief Financial Officer and Head of M&A of OACB and served in the same role for OAC until its business combination with HIMS. He is also a managing director within Oaktree s Value Equities strategy. He has spent his career originating, acquiring and managing middle-market companies in the industrial, consumer, and healthcare sectors, often operating platforms as CFO. Mr. Pardesi joined Oaktree in 2019 from The Cranemere Group, a global holding company, where he was a senior investment professional acquiring middle-market businesses. Prior to that time, Mr. Pardesi was an investor at H.I.G. Capital and at AEA Investors in New York and London. He began his career at Bain & Company. Mr. Pardesi received an M.B.A. from The Wharton School at the University of Pennsylvania, and a B.S. from Northwestern University, where he was a computer engineering and economics double major. Mathew Pendo is Chief Operating Officer of Oaktree Acquisition Corp. III. Mr. Pendo currently serves as the Chief Operating Officer of OACB and served in the same role for OAC until its business combination with HIMS. He is also the Head of Corporate Development and Capital Markets for Oaktree, the President and Chief Operating Officer of the two Oaktree-managed BDC s: Oaktree Specialty Lending Corporation and Oaktree Strategic Income II. Mr. Pendo joined Oaktree in 2015. His prior experience includes serving as the chief investment officer of the Troubled Asset Relief Program (TARP) of the U.S. Department of the Treasury, where he was honored with the Distinguished Service Award in 2013. Mr. Pendo began his career at Merrill Lynch, where he spent 18 years, starting in their investment banking division before becoming managing director of the technology industry group. Subsequently, Mr. Pendo was a managing director at Barclays Capital, first serving as co-head of U.S. Investment Banking and then co-head of Global Industrials group. He received a bachelor s degree in economics from Princeton University, cum laude and is a former board member of Ally Financial and SuperValu Inc. John Frank serves as the Chairman and a director on the board of directors of Oaktree Acquisition Corp. III. Mr. Frank serves in similar roles for OACB and was the Chairman and a director on the board of directors of OAC until its business combination with HIMS. He is Oaktree s Vice Chairman, working closely with Howard Marks, Bruce Karsh and Jay Wintrob (Oaktree s Chief Executive Officer) in managing the firm. From October 2017 to March 2021, Mr. Frank served as the Chairman of the Board of Directors of Oaktree Strategic Income Corporation prior to its merger with Oaktree Specialty Lending Corporation. Since October 2017, Mr. Frank has also served as the Chairman of the board of directors of Oaktree Specialty Lending Corporation. Mr. Frank joined Oaktree in 2001 as General Counsel and was named Oaktree s Managing Principal in early 2006, a position which he held for about nine years. As Managing Principal, Mr. Frank was the firm s principal executive officer and responsible for all aspects of the firm s management. Prior to joining Oaktree, Mr. Frank was a partner of the Los Angeles law firm of Munger, Tolles & Olson LLP where he managed a number of Table of Contents notable merger and acquisition transactions. While at that firm, he served as primary outside counsel to public- and privately-held corporations and as special counsel to various boards of directors and special board committees. Prior to joining Munger Tolles in 1984, Mr. Frank served as a law clerk to the Honorable Frank M. Coffin of the United States Court of Appeals for the First Circuit. Prior to attending law school, Mr. Frank served as a Legislative Assistant to the Honorable Robert F. Drinan, Member of Congress. Mr. Frank holds a B.A. degree with honors in history from Wesleyan University and a J.D. magna cum laude from the University of Michigan Law School, where he was Managing Editor of the Michigan Law Review and a member of the Order of the Coif. He is a member of the State Bar of California and, while in private practice, was listed in Woodward & White s Best Lawyers in America. Mr. Frank is a member of the Board of Directors of Chevron Corporation and a Trustee of Wesleyan University, The James Irvine Foundation, Good Samaritan Hospital of Los Angeles, and the XPRIZE Foundation. Marran Ogilvie has agreed to serve on our board of directors. Ms. Ogilvie has served as a Director of Four Corners Property Trust since 2015, as a Director of Ferro Corporation, a manufacturing company, since 2017, and as a Director of GCP Applied Technologies, a building products technologies company, since March 2019. Ms. Ogilvie previously served as an Advisor to the Creditors Committee for the Lehman Brothers International (Europe) Administration from 2008 to 2018, as a Director of Evolution Petroleum Corporation, an oil and gas company, from December 2017 to December 2020, as a Director of Bemis Company, a packaging company, from January 2018 to June 2019, as a Director of Forest City Realty Trust from April 2018 to December 2018, as a Director for Southwest Bancorp, a regional commercial bank from January 2012 to April 2015, as a Director of Seventy Seven Energy Inc., an oil field services company, from 2014 to 2017, as a Director of Zais Financial Corporation, a real estate investment trust, from 2013 to 2017, as a Director of the Korea Fund, an investment company, from 2012 to 2017, and as a Director of LSB Industries, Inc., a manufacturing company, from 2015 to 2018. Prior to that, Ms. Ogilvie was a member of Ramius, LLC, an alternative investment management firm, where she served in various capacities from 1994 to 2009 before the firm s merger with Cowen Group, including as Chief Operating Officer from 2007 to 2009 and General Counsel from 1997 to 2007. Following the merger, Ms. Ogilvie became Chief of Staff at Cowen Group, Inc. until 2010. Ms. Ogilvie received a Bachelor s degree from the University of Oklahoma and a Juris Doctorate from St. John s University. Alex Macedo has agreed to serve on our board of directors. Mr. Macedo serves on the board of Brinker International. Mr. Macedo is also a partner at Garnett Station Partners and Chairman & CEO of Fat Tuesday, one of Garnett Station Partners invested companies. Previously, Mr. Macedo served as an Executive Vice President at Restaurant Brands International, where he was global President of Tim Hortons, the iconic and largest Canadian restaurant company, from December 2017 to March 2020. Previously, he was the President for Burger King North America from 2013 until 2017, where he led the turnaround of the Burger King business in the United States. Mr. Macedo joined Burger King Corporation in 2011 as SVP for Marketing and later was General Manager of the U.S. franchise business. Prior to joining Burger King, Mr. Macedo was founder and partner of True Marketing, a Latin American sales & marketing consulting company from 2008 to 2011. He also worked at AmBev, owned by AB Inbev, from 2003 through 2007, where he served as head of the Brahma Beer business unit. Mr. Macedo served on the board of Carrols Restaurant Group (TAST), Burger King s largest franchisee, from 2013 to 2017. He was also the Co-Chair of the Burger King McLamore Foundation between 2014 and 2017. Mary-Catherine Lader has agreed to serve on our board of directors. She is Chief Operating Officer of Uniswap Labs, which developed the world s largest decentralized exchange for Table of Contents cryptocurrencies. She oversees Uniswap Labs strategy, corporate development, growth and operations. Previously she was a Managing Director at BlackRock, where she launched and was global head of its sustainable data, analytics and software business and was Chief Operating Officer of its digital wealth businesses. She was also an investment analyst in Goldman Sachs Special Situations Group, where she analyzed and executed public and private investments in clean technology and renewable energy. She is a director of the nonprofit Renaissance Institute, a Venture Partner at Torch Capital and a Term Member of the Council on Foreign Relations. She received a Bachelor s Degree in History at Brown University and a J.D. and M.B.A. from Harvard Law School and Business School, respectively. In April 2019 and August 2020, several members of our management team founded OAC and OACB, respectively, both special purpose acquisition companies formed for substantially similar purposes as our company. OAC completed its initial public offering in July 2019, in which it sold 20,125,000 units, each consisting of one Class A ordinary share of OAC and one-third of one redeemable warrant to purchase one Class A ordinary share of OAC, for an offering price of $10.00 per unit, generating aggregate proceeds of $201.25 million. In January 2021, OAC completed its business combination with HIMS, a market leading telehealth platform, creating a company with an implied enterprise value of approximately $1.6 billion. OACB completed its initial public offering in September 2020, in which it sold 25,000,000 units, each consisting of one Class A ordinary share of OACB and one-fourth of one warrant, for an offering price of $10.00 per unit, generating aggregate proceeds of $250 million. On December 7, 2021, OACB announced its initial business combination with Alvotech, a leading global biopharmaceutical company focused solely on the development and manufacture of biosimilar medicines for patients worldwide, and such transaction is expected to close in the first half of 2022. Mr. McCaney, Mr. Taubman, Mr. Pardesi and Mr. Pendo each serve as the Chief Executive Officer, President, Chief Financial Officer and Head of M&A and Chief Operating Officer of OACB, respectively, and served in similar roles with OAC until its business combination with HIMS. Additionally, Mr. McCaney and Mr. Frank serve as directors of OACB s Board of Directors. With respect to the above, past performance of our management team, the Value Equity Fund or Oaktree and its affiliates is not a guarantee of either (i) success with respect to a business combination that may be consummated or (ii) the ability to successfully identify and execute a transaction. You should not rely on the historical record of management or Oaktree and its affiliates as indicative of future performance. See Risk Factors Risks Relating to Our Securities Past performance by Oaktree or its affiliates, including our management team, may not be indicative of future performance of an investment in us. For a list of our executive officers and directors and entities for which a conflict of interest may or does exist between such officers and directors, on the one hand, and the company, on the other hand, please refer to Management Conflicts of Interest. Certain of our Founders, officers and directors presently have, and any of them in the future may have additional, fiduciary and contractual duties to other entities, including without limitation, OACB and investment funds, accounts, co-investment vehicles and other entities managed by Oaktree or its affiliates and certain companies in which Oaktree or such entities have invested. As a result, if any of our Founders, officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he, she or it has then-current fiduciary or contractual obligations (including, without limitation, OACB or any Oaktree funds or other investment vehicles), then, he, she or it may be required to honor such fiduciary or contractual obligations to present such business combination opportunity to such entity, before we can pursue such opportunity. However, we do not expect these duties to present a Table of Contents significant conflict of interest with our search for an initial business combination. We believe this conflict of interest will be naturally mitigated, to some extent, by the differing nature of the acquisition targets Oaktree typically considers most attractive for Oaktree funds and the types of acquisitions we expect Oaktree Acquisition Corp. III to find most attractive. As a result of due diligence from the broader platform, we may become aware of a potential transaction that is not a fit for the traditional investing activities of Oaktree but that is an attractive opportunity for us. In addition to the above, our officers and directors are not required to commit any specific amount of time to our affairs, and, accordingly will have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. Business Strategy While we will not be limited to a particular industry or geographic region, given the experience of our management team and Oaktree, our acquisition and value creation strategy will be to identify, acquire and build a company in the industrial and consumer sectors. Our acquisition strategy will leverage Oaktree s network of proprietary deal sourcing where we believe a combination of industry research, private equity sponsorship and lending relationships will provide us with a number of business combination opportunities. Additionally, we expect that relationships cultivated from years of transaction experience with management teams of public and private companies, investment bankers, restructuring advisers, attorneys and accountants will provide potential opportunities for our company. Our goal is to collaborate with a company that already is a fundamentally healthy company. We will seek to work with a potential acquisition candidate to access the capital markets, attract top tier management talent, and execute a proprietary value-creation business plan helping the company continue to grow into the next phase of its life cycle. We intend to employ a fundamental, value-oriented acquisition framework that seeks a target with the potential for significant equity value creation coupled with strong downside protection from dependable cash flows and a durable business franchise. The management team along with our Board of Directors have experience in: Operating companies in the public and private markets, defining corporate strategy, and identifying, mentoring and recruiting top talent; Growing companies, both organically and through strategic transactions, expanding product portfolios and broadening geographic footprints; Strategically investing in leading private and public industrial and consumer companies to help accelerate growth and maturation; Sourcing, structuring, acquiring and selling businesses; Accessing public and private capital markets to optimize capital structure, including financing businesses and helping companies transition ownership structures; and Fostering relationships with sellers, capital providers and experienced target management teams. Following the completion of this offering, we will communicate with our management s network of deal sourcing relationships to articulate the parameters for our search for a potential business combination and begin the process of pursuing and reviewing potential opportunities. Table of Contents Acquisition Criteria Consistent with our strategy, we have identified the following general criteria and guidelines which we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. We intend to acquire one or more businesses that we believe: Will benefit from a public currency. Access to the public equity markets could allow the target company to utilize an additional form of capital, enhancing its ability to pursue accretive acquisitions, high-return capital projects, and/or strengthen its balance sheet; Has a healthy growing platform. We will seek to invest in companies that we believe possess attractive business models that will provide a growing platform for equity investors; Has a management team and/or a strong sponsor that desires a significant equity stake in the post-business combination company. We will seek to partner with a management team and/or seller who is well-incentivized and aligned in an effort to create shareholder value; Can be acquired at an attractive valuation for public market investors. We will seek to be a disciplined steward of capital that will invest on terms that we believe provide attractive risk-adjusted returns; Will be resilient to economic cycles. We will focus on recession-resilient business models; Will have attractive cash flow profile and/or unit economics. We will seek to target businesses with attractive financial attributes; and Will benefit from Oaktree s long-term sponsorship as it looks to accelerate its growth in the public markets. We intend to acquire a company which we believe will benefit from our differentiated industry network, brand and proprietary value-creation capabilities to improve financial performance and business planning. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC. Our Acquisition Process In evaluating a prospective target business, we expect to conduct a thorough due diligence review which will encompass, among other things, meetings with incumbent management and employees, document reviews, inspection of facilities, as well as a review of financial, operational, legal and other information which will be made available to us. We will also utilize our operational and capital planning experience. Table of Contents We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion that our initial business combination is fair to our company from a financial point of view from either an independent investment banking firm or an independent accounting firm. Members of our management team may directly or indirectly own our ordinary shares and/or private placement warrants following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors is included by a target business as a condition to any agreement with respect to our initial business combination. Initial Business Combination Our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (net of amounts previously disbursed to management for Permitted Withdrawals (as defined herein) and excluding the amount of deferred underwriting discounts held in trust and taxes payable on the income earned on the trust account) at the time of signing the agreement to enter into the initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses or we are considering an initial business combination with an affiliated entity, we will obtain an opinion with respect to the satisfaction of such criteria from an independent investment banking firm or an independent valuation or accounting firm. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. Subject to this requirement, our management will have virtually unrestricted flexibility in identifying and selecting one or more prospective businesses. While we would not be permitted to effectuate our initial business combination solely with another blank check company or a similar company with nominal operations, we would be permitted to effectuate a business combination with an operating company together with one or more other blank check companies, including with OACB. We may, at our option, pursue an acquisition opportunity jointly with one or more parties affiliated with Oaktree, including without limitation, officers and partners of Oaktree, investment funds, accounts, co-investment vehicles and other entities managed by affiliates of Oaktree and/or investors in funds, accounts, co-investment vehicles and other entities managed by affiliates of Oaktree. Any such party may co-invest with us in the target business at the time of our initial business combination, or we could raise additional proceeds to complete the acquisition by issuing to such parties a specified future issuance. The amount and other terms and conditions of any such joint acquisition or specified future issuance would be determined at the time thereof. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the prior owners of the target business, the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company Table of Contents owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking shareholder approval, as applicable. To the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks inherent in a particular target business, we
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+thereof in effect as of the date of this prospectus, all of which are subject to change. This summary does not deal with all possible tax consequences relating to an investment in our ordinary shares and rights, such as the tax consequences under state, local and other tax laws. Prospective investors should consult their professional advisors on the possible tax consequences of buying, holding or selling any securities under the laws of their country of citizenship, residence or domicile. Cayman Islands Taxation The following is a discussion on certain Cayman Islands income tax consequences of an investment in our securities. The discussion is a general summary of present law, which is subject to prospective and retroactive change. It is not intended as tax advice, does not consider any investor s particular circumstances and does not consider tax consequences other than those arising under Cayman Islands law. Under Existing Cayman Islands Laws Payments of dividends and capital in respect of our securities will not be subject to taxation in the Cayman Islands and no withholding will be required on the payment of a dividend or capital to any holder of the securities nor will gains derived from the disposal of the securities be subject to Cayman Islands income or corporate tax. The Cayman Islands currently has no income, corporate or capital gains tax and no estate duty, inheritance tax or gift tax. No stamp duty is payable in respect of the issue of our securities or on an instrument of transfer in respect of our securities. The Company has been incorporated under the laws of the Cayman Islands as an exempted company with limited liability and, as such, has applied for and received an undertaking from the Financial Secretary of the Cayman Islands in the following form: The Tax Concessions Act (As Revised) Undertaking as to Tax Concessions In accordance with the provision of section 6 of The Tax Concessions Act (As Revised), the Financial Secretary undertakes with Mericsson Acquisition Corporation ("the Company"). 1. That no law which is hereafter enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations shall apply to the Company or its operations; and 2. In addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax shall be payable: 2.1 on or in respect of the shares, debentures or other obligations of the Company; OR 2.2 by way of the withholding in whole or part, of any relevant payment as defined in Section 6(3) of the Tax Concessions Act (As Revised). 3. These concessions shall be for a period of 20 years from the date hereof. 115 United States Federal Income Taxation General The following discussion summarizes certain United States federal income tax considerations generally applicable to the acquisition, ownership and disposition of our units, each consisting of one Class A ordinary share and one right, which we refer to collectively as our securities, that are purchased in this offering by U.S. Holders (as defined below) and Non-U.S. Holders (as defined below)). Because the components of a unit are generally separable at the option of the holder, the holder of a unit generally should be treated, for United States federal income tax purposes, as the owner of the underlying Class A ordinary share and right components of the unit. As a result, the discussion below with respect to holders of Class A ordinary shares and rights should also apply to holders of units (as the deemed owners of the underlying Class A ordinary share and rights that constitute the units). This discussion is limited to certain United States federal income tax considerations to beneficial owners of our securities who are initial purchasers of a unit pursuant to this offering and hold the unit and each component of the unit as a capital asset under the U.S. Internal Revenue Code of 1986, as amended (the "Code"). This discussion assumes that the Class A ordinary shares and rights will trade separately and that any distributions made (or deemed made) by us on our Class A ordinary shares and any consideration received (or deemed received) by a holder in consideration for the sale or other disposition of our securities will be in U.S. dollars. This discussion is a summary only and does not consider all aspects of United States federal income taxation that may be relevant to the acquisition, ownership and disposition of a unit by a prospective investor in light of its particular circumstances, including: the sponsor, officers, directors or other holders of our Class B ordinary shares or private rights; banks, financial institutions or financial services entities; broker-dealers; retirement plans, individual retirement accounts or other tax-deferred accounts; taxpayers that are subject to the mark-to-market accounting rules; S-corporations, partnerships or other flow-through entities and investors therein; tax-exempt entities; governments or agencies or instrumentalities thereof; insurance companies; regulated investment companies; real estate investment trusts; persons liable for alternative minimum tax; expatriates or former long-term residents of the United States; persons that actually or constructively own five percent or more of our voting shares or the total value of our shares; persons that acquired our securities pursuant to an exercise of employee share options, in connection with employee share incentive plans or otherwise as compensation or in connection with services; persons that hold our securities as part of a straddle, constructive sale, hedging, conversion or other integrated or similar transaction; or U.S. Holders (as defined below) whose functional currency is not the U.S. dollar. Moreover, the discussion below is based upon the provisions of the Code, the Treasury regulations promulgated thereunder ("Treasury Regulations") and administrative and judicial interpretations thereof, all as of the date hereof, and such provisions may be repealed, revoked, modified or subject to differing interpretations, possibly on a retroactive basis, so as to result in United States federal income tax consequences different from those discussed below. Furthermore, this discussion does not address any aspect of United States federal non-income tax laws, such as gift, estate or Medicare contribution tax laws, or state, local or non-U.S. tax laws. 116 We have not sought, and will not seek, a ruling from the IRS as to any United States federal income tax consequence described herein. The IRS may disagree with the discussion herein, and its determination may be upheld by a court. Moreover, there can be no assurance that future legislation, regulations, administrative rulings or court decisions will not adversely affect the accuracy of the statements in this discussion. As used herein, the term "U.S. Holder" means a beneficial owner of units, Class A ordinary shares or rights who or that is for United States federal income tax purposes: (i) an individual citizen or resident of the United States, (ii) a corporation (or other entity treated as a corporation for United States federal income tax purposes) that is created or organized (or treated as created or organized) in or under the laws of the United States, any state thereof or the District of Columbia, (iii) an estate the income of which is subject to United States federal income taxation regardless of its source or (iv) a trust if (A) a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust, or (B) it has in effect a valid election to be treated as a U.S. person. This discussion does not consider the tax treatment of partnerships or other pass-through entities or persons who hold our securities through such entities. If a partnership (or other entity or arrangement classified as a partnership for United States federal income tax purposes) is the beneficial owner of our securities, the United States federal income tax treatment of a partner in the partnership generally will depend on the status of the partner and the activities of the partnership. Partnerships holding our securities and partners in such partnerships are urged to consult their own tax advisors. THIS DISCUSSION IS ONLY A SUMMARY OF CERTAIN UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS ASSOCIATED WITH THE ACQUISITION, OWNERSHIP AND DISPOSITION OF OUR SECURITIES. EACH PROSPECTIVE INVESTOR IN OUR SECURITIES IS URGED TO CONSULT ITS OWN TAX ADVISOR WITH RESPECT TO THE PARTICULAR TAX CONSEQUENCES TO SUCH INVESTOR OF THE ACQUISITION, OWNERSHIP AND DISPOSITION OF OUR SECURITIES, INCLUDING THE APPLICABILITY AND EFFECT OF ANY STATE, LOCAL, AND NON-U.S. TAX LAWS. Allocation of Purchase Price and Characterization of a Unit No statutory, administrative or judicial authority directly addresses the treatment of a unit or instruments similar to a unit for United States federal income tax purposes, and therefore, that treatment is not entirely clear. The acquisition of a unit should be treated for United States federal income tax purposes as the acquisition of one Class A ordinary share and one right. For United States federal income tax purposes, each holder of a unit must allocate the purchase price paid by such holder for such unit among the one Class A ordinary share and one right based on the relative fair market value of each at the time of issuance. The price allocated to each Class A ordinary share and one right should be the shareholder s tax basis in such share or right. Any disposition of a unit should be treated for United States federal income tax purposes as a disposition of the Class A ordinary share and right comprising the unit, and the amount realized on the disposition should be allocated among the Class A ordinary share and right based on their respective relative fair market values. The separation of the Class A ordinary share and right constituting a unit should not be a taxable event for United States federal income tax purposes. The foregoing treatment of the Class A ordinary shares and rights and a holder s purchase price allocation are not binding on the IRS or the courts. Because there are no authorities that directly address instruments that are similar to the units, no assurance can be given that the IRS or the courts will agree with the characterization described above or the discussion below. Accordingly, each prospective investor is urged to consult its tax advisors regarding the tax consequences of an investment in a unit (including alternative characterizations of a unit). The balance of this discussion assumes that the characterization of the units described above is respected for United States federal income tax purposes. U.S. Holders Taxation of Distributions Subject to the passive foreign investment company ("PFIC") rules discussed below, a U.S. Holder generally will be required to include in gross income as dividends the amount of any cash distribution paid on our Class A ordinary shares to the extent the distribution is paid out of our current or accumulated earnings and profits (as determined under United States federal income tax principles). Such dividends paid by us will be taxable to a corporate U.S. Holder at regular rates and will not be eligible for the dividends-received deduction generally allowed to domestic corporations in respect of dividends received from other domestic corporations. Subject to the PFIC rules discussed below, distributions in excess of such earnings and profits generally will be applied against and reduce the U.S. Holder s basis in its Class A ordinary shares (but not below zero) and, to the extent in excess of such basis, will be treated as gain from the sale or exchange of such Class A ordinary shares. 117 With respect to non-corporate U.S. Holders, under tax laws currently in effect, dividends generally will be taxed at the lower applicable long-term capital gains rate (see "Gain or Loss on Sale, Taxable Exchange or Other Taxable Disposition of Class A Ordinary Shares and Rights" below) only if our Class A ordinary shares are readily tradable on an established securities market in the United States and certain other requirements are met, including that we are not classified as a PFIC during the taxable year in which the dividend is paid or the preceding taxable year and, perhaps, until after the close of the first two taxable years following our start-up year (within the meaning of the start-up exception). U.S. Holders should consult their tax advisors regarding the availability of such lower rate for any dividends paid with respect to our Class A ordinary shares. Gain or Loss on Sale, Taxable Exchange or Other Taxable Disposition of Class A Ordinary Shares and Rights Subject to the PFIC rules discussed below, a U.S. Holder generally will recognize capital gain or loss on the sale or other taxable disposition of our Class A ordinary shares or rights (including on our dissolution and liquidation if we do not consummate an initial business combination within the required time period). Any such capital gain or loss generally will be long-term capital gain or loss if the U.S. Holder s holding period for such Class A ordinary share or rights exceeds one year. It is unclear, however, whether certain redemption rights described in this prospectus may suspend the running of the applicable holding period of the ordinary shares for this purpose. The amount of gain or loss recognized on a sale or other taxable disposition generally will be equal to the difference between (i) the sum of the amount of cash and the fair market value of any property received in such disposition (or, if the Class A ordinary shares or rights are held as part of units at the time of the disposition, the portion of the amount realized on such disposition that is allocated to the Class A ordinary shares or rights based upon the then fair market values of the Class A ordinary shares and rights included in the units) and (ii) the U.S. Holder s adjusted tax basis in its Class A ordinary shares or rights so disposed of. A U.S. Holder s adjusted tax basis in its Class A ordinary shares or rights generally will equal the U.S. Holder s acquisition cost (that is, the portion of the purchase price of a unit allocated to the ordinary share or one right, as described above under "— Allocation of Purchase Price and Characterization of a Unit") reduced by any prior distributions treated as a return of capital. Long-term capital gain realized by a non-corporate U.S. Holder is currently eligible to be taxed at reduced rates. See "— Acquisition of Class A Ordinary Shares Pursuant to Rights" below for a discussion regarding a U.S. Holder s basis in a Class A ordinary share acquired pursuant to the exercise of a right. The deduction of capital losses is subject to certain limitations. Redemption of Class A Ordinary Shares Subject to the PFIC rules discussed below, in the event that a U.S. Holder s Class A ordinary shares are redeemed pursuant to the redemption provisions described in this prospectus under "Description of Securities — Ordinary Shares" or if we purchase a U.S. Holder s Class A ordinary shares in an open market transaction (each of which we refer to as a "redemption"), the treatment of the transaction for United States federal income tax purposes will depend on whether the redemption qualifies as a sale of the Class A ordinary shares under Section 302 of the Code. If the redemption qualifies as a sale of Class A ordinary shares, the U.S. Holder will be treated as described under "Gain or Loss on Sale, Taxable Exchange or Other Taxable Disposition of Class A Ordinary Shares and Rights" above. If the redemption does not qualify as a sale of Class A ordinary shares, the U.S. Holder will be treated as receiving a corporate distribution with the tax consequences described above under "Taxation of Distributions." Whether a redemption qualifies for sale treatment will depend largely on the total number of our shares treated as held by the U.S. Holder (including any Class A ordinary shares constructively owned by the U.S. Holder as a result of owning rights) relative to all of our shares outstanding both before and after such redemption or purchase. The redemption of Class A ordinary shares generally will be treated as a sale of the Class A ordinary shares (rather than as a corporate distribution) if such redemption or purchase (i) is "substantially disproportionate" with respect to the U.S. Holder, (ii) results in a "complete termination" of the U.S. Holder s interest in us or (iii) is "not essentially equivalent to a dividend" with respect to the U.S. Holder. These tests are explained more fully below. 118 In determining whether any of the foregoing tests are satisfied, a U.S. Holder takes into account not only our shares actually owned by the U.S. Holder, but also our shares that are constructively owned by such holder. A U.S. Holder may constructively own, in addition to shares owned directly, shares owned by certain related individuals and entities in which the U.S. Holder has an interest or that have an interest in such U.S. Holder, as well as any shares the U.S. Holder has a right to acquire by exercise of an option, which would possibly include Class A ordinary shares which could be acquired pursuant to the rights. In order to meet the substantially disproportionate test, the percentage of our issued and outstanding voting shares actually and constructively owned by the U.S. Holder immediately following the redemption of Class A ordinary shares must, among other requirements, be less than 80 percent of the percentage of our issued and outstanding voting shares actually and constructively owned by the U.S. Holder immediately before the redemption. Prior to our initial business combination the Class A ordinary shares may not be treated as voting shares for this purpose and, consequently, this substantially disproportionate test may not be applicable. There will be a complete termination of a U.S. Holder s interest if either (i) all of our shares actually and constructively owned by the U.S. Holder are redeemed or (ii) all of our shares actually owned by the U.S. Holder are redeemed and the U.S. Holder is eligible to waive, and effectively waives in accordance with specific rules, the attribution of shares owned by certain family members and the U.S. Holder does not constructively own any other shares of ours. The redemption of the Class A ordinary shares will not be essentially equivalent to a dividend if such redemption results in a "meaningful reduction" of the U.S. Holder s proportionate interest in us. Whether the redemption will result in a meaningful reduction in a U.S. Holder s proportionate interest in us will depend on the particular facts and circumstances. However, the IRS has indicated in a published ruling that even a small reduction in the proportionate interest of a small minority shareholder in a publicly held corporation who exercises no control over corporate affairs may constitute such a "meaningful reduction." A U.S. Holder should consult its own tax advisors as to the tax consequences of a redemption. If none of the foregoing tests are satisfied, then the redemption will be treated as a corporate distribution and the tax effects will be as described under "Taxation of Distributions" above. After the application of those rules, any remaining tax basis of the U.S. Holder in the redeemed Class A ordinary shares will be added to the U.S. Holder s adjusted tax basis in its remaining shares. If there are no remaining shares, a U.S. Holder is urged to consult its tax advisor as to the allocation of any remaining tax basis. 119 Acquisition of Class A Ordinary Shares Pursuant to Rights The treatment of the rights to acquire Class A ordinary shares is uncertain. The rights may be viewed as a forward contract, derivative security or similar interest in our company (analogous to a warrant or option with no exercise price), and thus the holder of the rights would not be viewed as owning the Class A ordinary shares issuable pursuant to the rights until such Class A ordinary shares are actually issued. There may be other alternative characterizations of the rights that the IRS may successfully assert, including that the rights are treated as equity in our company at the time the rights are issued. The tax consequences of an acquisition of our Class A ordinary shares pursuant to rights are unclear and will depend on the treatment of any initial business combination. Accordingly, U.S. Holders should consult their tax advisors regarding the tax consequences of an acquisition of Class A ordinary shares pursuant to rights and the consequences of any initial business combination. Passive Foreign Investment Company Rules A non-U.S. corporation will be classified as a PFIC for United States federal income tax purposes if either (i) at least 75% of its gross income in a taxable year, including its pro rata share of the gross income of any corporation in which it is considered to own at least 25% of the shares by value, is passive income or (ii) at least 50% of its assets in a taxable year (ordinarily determined based on fair market value and averaged quarterly over the year), including its pro rata share of the assets of any corporation in which it is considered to own at least 25% of the shares by value, are held for the production of, or produce, passive income. Passive income generally includes dividends, interest, rents and royalties (other than rents or royalties derived from the active conduct of a trade or business) and gains from the disposition of passive assets. Because we are a blank check company, with no current active business, we believe that it is likely that we will meet the PFIC asset or income test for our current taxable year. However, pursuant to a startup exception, a corporation will not be a PFIC for the first taxable year the corporation has gross income (the "startup year"), if (1) no predecessor of the corporation was a PFIC; (2) the corporation satisfies the IRS that it will not be a PFIC for either of the first two taxable years following the startup year; and (3) the corporation is not in fact a PFIC for either of those years. The applicability of the startup exception to us will not be known until after the close of our current taxable year and, perhaps, until after the close of the first two taxable years following our current taxable year. Further, after the acquisition of a company or assets in a business combination, we may still meet one of the PFIC tests depending on the timing of the acquisition and the amount of our passive income and assets as well as the passive income and assets of the acquired business. If the company that we acquire in a business combination is a PFIC, then we will likely not qualify for the startup exception and will be a PFIC for our current taxable year. Our actual PFIC status for our current taxable year or any subsequent taxable year will not be determinable until after the end of such taxable year. Accordingly, there can be no assurance with respect to our status as a PFIC for our current taxable year or any future taxable year. Although our PFIC status is determined annually, an initial determination that our company is a PFIC will generally apply for subsequent years to a U.S. Holder who held ordinary shares or rights while we were a PFIC, whether or not we meet the test for PFIC status in those subsequent years. If we are determined to be a PFIC for any taxable year (or portion thereof) that is included in the holding period of a U.S. Holder of our Class A ordinary shares or rights and, in the case of our Class A ordinary shares, the U.S. Holder did not make either a timely qualified electing fund ("QEF") election or a mark-to-market election for our first taxable year as a PFIC in which the U.S. Holder held (or was deemed to hold) Class A ordinary shares, as described below, such U.S. Holder generally will be subject to special rules with respect to (i) any gain recognized by the U.S. Holder on the sale or other disposition of its Class A ordinary shares or rights and (ii) any "excess distribution" made to the U.S. Holder (generally, any distributions to such U.S. Holder during a taxable year of the U.S. Holder that are greater than 125% of the average annual distributions received by such U.S. Holder in respect of the Class A ordinary shares during the three preceding taxable years of such U.S. Holder or, if shorter, such U.S. Holder s holding period for the Class A ordinary shares). Under these rules: the U.S. Holder s gain or excess distribution will be allocated ratably over the U.S. Holder s holding period for the Class A ordinary shares or rights; 120 the amount allocated to the U.S. Holder s taxable year in which the U.S. Holder recognized the gain or received the excess distribution, or to the period in the U.S. Holder s holding period before the first day of our first taxable year in which we are a PFIC, will be taxed as ordinary income; the amount allocated to other taxable years (or portions thereof) of the U.S. Holder and included in its holding period will be taxed at the highest tax rate in effect for that year and applicable to the U.S. Holder; and an additional tax equal to the interest charge generally applicable to underpayments of tax will be imposed on the U.S. Holder with respect to the tax attributable to each such other taxable year of the U.S. Holder. In general, if we are determined to be a PFIC, a U.S. Holder may avoid the PFIC tax consequences described above in respect to our Class A ordinary shares (but possibly not our rights) by making a timely and valid QEF election (if eligible to do so) to include in income its pro rata share of our net capital gains (as long-term capital gain) and other earnings and profits (as ordinary income), on a current basis, in each case whether or not distributed, in the taxable year of the U.S. Holder in which or with which our taxable year ends. A U.S. Holder generally may make a separate election to defer the payment of taxes on undistributed income inclusions under the QEF rules, but if deferred, any such taxes will be subject to an interest charge. In the alternative, a U.S. Holder may avoid the PFIC tax consequences described above by making a "mark-to-market" election. The QEF election and mark-to-market election are described further below. The treatment of the rights to acquire our Class A ordinary shares is unclear. For example, the rights may be viewed as a forward contract, derivative security or similar interest in our company (analogous to a warrant or option with no exercise price), and thus the holder of the rights would not be viewed as owning the Class A ordinary shares issuable pursuant to the rights until such Class A ordinary shares are actually issued. There may be other alternative characterizations of the rights that the IRS may successfully assert, including that the rights are treated as equity in our company at the time the rights are issued, that would reach different conclusions regarding the tax treatment of the rights under the PFIC rules. In any case, depending on which characterization is successfully applied to the rights, different PFIC consequences may result for U.S. Holders of the rights. It is also possible that a U.S. Holder of rights would not be able to make a QEF or mark-to-market election (discussed below) with respect to such U.S. Holder s rights. Due to the uncertainty of the application of the PFIC rules to the rights, all potential investors are strongly urged to consult with their own tax advisors regarding an investment in the rights offered hereunder as part of the units offering and the subsequent consequences to holders of such rights in any initial business combination. The QEF election is made on a shareholder-by-shareholder basis and, once made, can be revoked only with the consent of the IRS. A U.S. Holder generally makes a QEF election by attaching a completed IRS Form 8621 (Information Return by a Shareholder of a Passive Foreign Investment Company or Qualified Electing Fund), including the information provided in a PFIC annual information statement, to a timely filed United States federal income tax return for the tax year to which the election relates. Retroactive QEF elections generally may be made only by filing a protective statement with such return and if certain other conditions are met or with the consent of the IRS. U.S. Holders should consult their tax advisors regarding the availability and tax consequences of a retroactive QEF election under their particular circumstances. In order to comply with the requirements of a QEF election, a U.S. Holder must receive a PFIC annual information statement from us. If we determine we are a PFIC for any taxable year (of which there can be no assurance), we will endeavor to provide to a U.S. Holder such information as the IRS may require, including a PFIC annual information statement, in order to enable the U.S. Holder to make and maintain a QEF election, but there is no assurance that we will timely provide such required information. There is also no assurance that we will have timely knowledge of our status as a PFIC in the future or of the required information to be provided. If a U.S. Holder has made a QEF election with respect to our Class A ordinary shares, and the excess distribution rules discussed above do not apply to such shares (because of a timely QEF election for our first taxable year as a PFIC in which the U.S. Holder holds (or is deemed to hold) such shares or a purge of the PFIC taint pursuant to a purging election, as described above), any gain recognized on the sale of our Class A ordinary shares generally will be taxable as capital gain and no additional tax charge will be imposed under the PFIC rules. As discussed above, if we are a PFIC for any taxable year, a U.S. Holder of our Class A ordinary shares that has made a QEF election will be currently taxed on its pro rata share of our earnings and profits, whether or not distributed for such year. A subsequent distribution of such earnings and profits that were previously included in income generally should not be taxable when distributed to such U.S. Holder. The tax basis of a U.S. Holder s shares in a QEF will be increased by amounts that are included in income, and decreased by amounts distributed but not taxed as dividends, under the above rules. In addition, if we are not a PFIC for any taxable year, such U.S. Holder will not be subject to the QEF inclusion regime with respect to our Class A ordinary shares for such a taxable year. 121 If we are a PFIC and our Class A ordinary shares constitute "marketable stock," a U.S. Holder may avoid the adverse PFIC tax consequences discussed above if such U.S. Holder, at the close of the first taxable year in which it holds (or is deemed to hold) our Class A ordinary shares, makes a mark-to-market election with respect to such shares for such taxable year. Such U.S. Holder generally will include for each of its taxable years as ordinary income the excess, if any, of the fair market value of its Class A ordinary shares at the end of such year over its adjusted basis in its Class A ordinary shares. The U.S. Holder also will recognize an ordinary loss in respect of the excess, if any, of its adjusted basis of its Class A ordinary shares over the fair market value of its Class A ordinary shares at the end of its taxable year (but only to the extent of the net amount of previously included income as a result of the mark-to-market election). The U.S. Holder s basis in its Class A ordinary shares will be adjusted to reflect any such income or loss amounts, and any further gain recognized on a sale or other taxable disposition of its Class A ordinary shares will be treated as ordinary income. Currently, a mark-to-market election possibly may not be made with respect to our rights. The mark-to-market election is available only for "marketable stock," generally, stock that is regularly traded on a national securities exchange that is registered with the Securities and Exchange Commission, including Nasdaq (on which we intend to list the Class A ordinary shares), or on a foreign exchange or market that the IRS determines has rules sufficient to ensure that the market price represents a legitimate and sound fair market value. U.S. Holders should consult their own tax advisors regarding the availability and tax consequences of a mark-to-market election in respect to our ordinary shares under their particular circumstances. If we are a PFIC and, at any time, have a foreign subsidiary that is classified as a PFIC, U.S. Holders generally would be deemed to own a portion of the shares of such lower-tier PFIC, and generally could incur liability for the deferred tax and interest charge described above if we receive a distribution from, or dispose of all or part of our interest in, the lower-tier PFIC or the U.S. Holders otherwise were deemed to have disposed of an interest in the lower-tier PFIC. We will endeavor to cause any lower-tier PFIC to provide to a U.S. Holder the information that may be required to make or maintain a QEF election with respect to the lower-tier PFIC. There can be no assurance that we will have timely knowledge of the status of any such lower-tier PFIC. In addition, we may not hold a controlling interest in any such lower-tier PFIC and thus there can be no assurance we will be able to cause the lower-tier PFIC to provide such required information. U.S. Holders are urged to consult their tax advisors regarding the tax issues raised by lower-tier PFICs. A U.S. Holder that owns (or is deemed to own) shares in a PFIC during any taxable year of the U.S. Holder, may have to file an IRS Form 8621 (whether or not a QEF or mark-to-market election is made) and such other information as may be required by the U.S. Treasury Department. Failure to do so, if required, will extend the statute of limitations until such required information is furnished to the IRS. The rules dealing with PFICs and with the QEF and mark-to-market elections are very complex and are affected by various factors in addition to those described above. Accordingly, U.S. Holders of our Class A ordinary shares or rights should consult their own tax advisors concerning the application of the PFIC rules to our securities under their particular circumstances. Tax Reporting Certain U.S. Holders may be required to file an IRS Form 926 (Return by a U.S. Transferor of Property to a Foreign Corporation) to report a transfer of property (including cash) to us. Substantial penalties may be imposed on a U.S. Holder that fails to comply with this reporting requirement. Furthermore, certain U.S. Holders who are individuals and certain entities will be required to report information with respect to such U.S. Holder s investment in "specified foreign financial assets" on IRS Form 8938 (Statement of Specified Foreign Financial Assets), subject to certain exceptions. Persons who are required to report specified foreign financial assets and fail to do so may be subject to substantial penalties. Potential investors are urged to consult their tax advisors regarding the foreign financial asset and other reporting obligations and their application to an investment in our Class A ordinary shares and rights. 122 Non-U.S. Holders This section applies to you if you are a "Non-U.S. Holder." As used herein, the term "Non-U.S. Holder" means a beneficial owner of our units, Class A ordinary shares or rights that is for U.S. federal income tax purposes: a non-resident alien individual (other than certain former citizens and residents of the United States subject to U.S. tax as expatriates); a foreign corporation; or an estate or trust that is not a U.S. Holder; but generally does not include an individual who is present in the United States for 183 days or more in the taxable year of disposition. If you are such an individual, you should consult your tax advisor regarding the U.S. federal income tax consequences of the sale or other disposition of our securities. Dividends (including constructive distributions treated as dividends) paid or deemed paid to a Non-U.S. Holder in respect of our Class A ordinary shares generally will not be subject to United States federal income tax, unless the dividends are effectively connected with the Non-U.S. Holder s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, are attributable to a permanent establishment or fixed base that such Non-U.S. Holder maintains in the United States). In addition, a Non-U.S. Holder generally will not be subject to United States federal income tax on any gain attributable to a sale or other disposition of our Class A ordinary shares or rights unless such gain is effectively connected with its conduct of a trade or business in the United States (and, if required by an applicable income tax treaty, is attributable to a permanent establishment or fixed base that such Non-U.S. Holder maintains in the United States). Dividends (including constructive distributions treated as dividends) and gains that are effectively connected with the Non-U.S. Holder s conduct of a trade or business in the United States (and, if required by an applicable income tax treaty, are attributable to a permanent establishment or fixed base in the United States) generally will be subject to United States federal income tax at the same regular United States federal income tax rates applicable to a comparable U.S. Holder and, in the case of a Non-U.S. Holder that is a corporation for United States federal income tax purposes, also may be subject to an additional branch profits tax at a 30% rate or a lower applicable tax treaty rate. The treatment of the rights to acquire Class A ordinary shares is uncertain. The rights may be viewed as a forward contract, derivative security or similar interest in our company, and thus the holder of the rights would not be viewed as owning the Class A ordinary shares issuable pursuant to the rights until such Class A ordinary shares are actually issued. There may be other alternative characterizations of the rights that the IRS may successfully assert, including that the rights are treated as equity in our company at the time the rights are issued. The tax consequences of an acquisition of our Class A ordinary shares pursuant to rights are unclear and will depend on the treatment of any initial business combination. Accordingly, Non-U.S. Holders should consult their tax advisors regarding the tax consequences of an acquisition of Class A ordinary shares pursuant to rights and the consequences of any initial business combination. Information Reporting and Backup Withholding Dividend payments with respect to our Class A ordinary shares and proceeds from the sale, exchange or redemption of our securities may be subject to information reporting to the IRS and possible United States backup withholding. Backup withholding will not apply, however, to a U.S. Holder who furnishes a correct taxpayer identification number and makes other required certifications, or who is otherwise exempt from backup withholding and establishes such exempt status. A Non-U.S. Holder generally will eliminate the requirement for information reporting and backup withholding by providing certification of its foreign status, under penalties of perjury, on a duly executed applicable IRS Form W-8 or by otherwise establishing an exemption. Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against a holder s U.S. federal income tax liability, and a holder generally may obtain a refund of any excess amounts withheld under the backup withholding rules by timely filing the appropriate claim for refund with the IRS and furnishing any required information. Holders are urged to consult their own tax advisors regarding the application of backup withholding and the availability of and procedure for obtaining an exemption from backup withholding in their particular circumstances. 123 UNDERWRITING We are offering the units described in this prospectus through the underwriters named below. Maxim Group LLC is acting as representative of the underwriters. We have entered into an underwriting agreement with the representative. Subject to the terms and conditions of the underwriting agreement, the underwriters have agreed to purchase, and we have agreed to sell to the underwriters, the number of units listed next to each of its name in the following table: Underwriter Number of Units Maxim Group LLC Total 4,000,000 The underwriting agreement provides that the underwriters must buy all of the units if they buy any of them. However, the underwriters are not required to purchase the units covered by the option to purchase additional units as described below. Our units are offered subject to a number of conditions, including: receipt and acceptance of our units by the underwriters; and the underwriters right to reject orders in whole or in part. In connection with this offering, the underwriters or securities dealers may distribute prospectuses electronically. Option to Purchase Additional Units We have granted the underwriters an option to buy up to an aggregate of 600,000 additional units. The underwriters have 45 days from the date of this prospectus to exercise this option. If the underwriters exercise this option, they will purchase additional units approximately in proportion to the amounts specified in the table above. Underwriting Discount Units sold by the underwriters to the public will initially be offered at the initial offering price set forth on the cover of this prospectus. Any units sold by the underwriters to securities dealers may be sold at a discount of up to $ per unit from the initial public offering price and the dealers may reallow a concession not in excess of $ per unit to other dealers. Sales of units made outside of the United States may be made by affiliates of the underwriters. After completion
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: Cantor refers to Cantor Fitzgerald & Co., the representative of the underwriters; Companies Act refers to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; directors are to our current directors; founder shares are to Class B ordinary shares initially purchased by our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination as described herein; initial shareholders are to holders of our founder shares prior to this offering; management or our management team are to our executive officers and directors; Moelis refers to Moelis & Company, Moelis & Company Group LP ( Group LP ) and Group LP s subsidiaries, each an affiliate of us and our sponsor, including Moelis & Company LLC (a broker-dealer registered with the Securities and Exchange Commission and a member of the Financial Industry Regulatory Authority); ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; public shares are to Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders are to the holders of our public shares, including our initial shareholders and management team to the extent our initial shareholders and/or members of our management team purchase public shares, provided that each initial shareholder s and member of our management team s status as a public shareholder will only exist with respect to such public shares; private placement warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering; sponsor are to, together, Atlas Crest Investment III-A LLC, a Delaware limited liability company and Atlas Crest Investment III-B LLC, a Delaware limited liability company; and we, us, company or our company are to Atlas Crest Investment Corp. III, a Cayman Islands exempted company. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. General We are a newly organized blank check company formed as a Delaware corporation on February 2, 2021 for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. Throughout this prospectus we will refer to this as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. While we may pursue our initial business combination in any business or industry, we intend to focus on a target in an industry which complements our management team s, board s and sponsor s expertise and which will benefit from our strategic and operational value add. We believe the diverse experience and extensive relationship network of our management team, board and sponsor will drive particularly attractive investment opportunities in certain high growth sectors including media, fintech/payments, software and technology enabled services, online TABLE OF CONTENTS The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUSSUBJECT TO COMPLETION, DATED MARCH 16, 2022 $200,000,000 Atlas Crest Investment Corp. III 20,000,000 Units Atlas Crest Investment Corp. III is a blank check company registered as a Cayman Islands exempted company whose business purpose is to effect a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business combination. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share and one-fourth of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as described herein. Only whole warrants are exercisable. The warrants will become exercisable on the later of 30 days after the completion of our initial business combination or 12 months from the closing of this offering, and will expire five years after the completion of our initial business combination or earlier upon redemption or our liquidation, as described herein. The underwriters have a 45-day option from the date of this prospectus to purchase up to 3,000,000 additional units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination as described herein. If we are unable to complete our initial business combination within 24 months from the closing of this offering, we will redeem 100% of the public shares as described herein. Atlas Crest Investment III-A LLC and Atlas Crest Investment III-B LLC, together herein referred to as our sponsor, have committed to purchase an aggregate of 4,000,000 private placement warrants (or up to 4,400,000 private placement warrants if the over-allotment option is exercised in full) each exercisable to purchase one Class A ordinary share at $11.50 per share, at a price of $1.50 per warrant, or $6,000,000 (or up to $6,600,000 if the over-allotment option is exercised in full) in the aggregate, in a private placement that will close simultaneously with the closing of this offering. Currently, there is no public market for our units, Class A ordinary shares or warrants. We have applied to have our units listed on the New York Stock Exchange, or the NYSE, under the symbol ACCC.U We expect that the Class A ordinary shares and warrants comprising the units will begin separate trading on the NYSE under the symbols ACCC and ACCC respectively, on the 52nd day following the date of this prospectus, unless Cantor Fitzgerald & Co. permits earlier separate trading and we have satisfied certain conditions. We cannot guarantee that our securities will be approved for listing on the NYSE. We are an emerging growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. No offer or invitation to subscribe for securities may be made to the public in the Cayman Islands. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 33 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 200,000,000 Underwriting discounts and commissions(1) $ 0.20 $ 4,000,000 Proceeds, before expenses, to us $ 9.80 $ 196,000,000 (1) $0.20 per unit sold in the base offering, or $4,000,000 in the aggregate (or $4,600,000 if the over-allotment option is exercised in full), is payable upon the closing of this offering. See also Underwriting for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $200 million, or $230 million if the underwriters over-allotment option is exercised in full ($10.00 per unit in either case), will be deposited into a trust account in the United States with Continental Stock Transfer & Trust Company acting as trustee. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2022. , 2022 Sole Book-Running Manager Cantor TABLE OF CONTENTS gaming/sports betting, healthcare and disruptive consumer. On March 10, 2022, we transferred our domicile from Delaware to the Cayman Islands by way of continuation. Our Management Team Our management team is led by Ken Moelis, our Chairman, and Michael Spellacy, our Chief Executive Officer and a director. Mr. Moelis and Mr. Spellacy s careers have centered around identifying, evaluating and implementing organic and inorganic transformational growth and value creation initiatives across a broad range of industries. Our sponsor is an affiliate of Moelis & Company, a leading global financial advisor to corporate executives, boards, entrepreneurs, financial sponsors and governments. Mr. Moelis and Chris Callesano, our Chief Financial Officer, are Managing Directors at Moelis. We believe that the experience and capabilities of our management team will make us an attractive partner to potential target businesses, enhance our ability to complete a successful initial business combination and enhance the value of the business post-business combination. Additionally, we believe the proprietary sourcing channels and extensive relationship network of our management team and from our affiliation with Moelis, combined with our operating, investing, capital markets and transaction experience, provide us with a competitive advantage. Mr. Moelis is a global leader in the investment banking industry, with almost 40 years of investment banking and mergers and acquisitions experience. During his career, Mr. Moelis has helped build and manage three of the most successful financial services growth stories of the past three decades. In 2007, Mr. Moelis founded Moelis & Company and in 2014 led Moelis initial public offering ( IPO ) while being named EuroMoney s Banker of the Year. Since its IPO, Moelis has organically grown revenues by over 275% and has generated a total shareholder return of over 250%, including quarterly and special dividends, eclipsing its peer group and major financial indices. Mr. Moelis is Chairman of the Board and Chief Executive Officer of Moelis. Moelis is a leading independent investment banking and advisory firm which provides advice on mergers and acquisitions, financial restructurings, valuation and capital structure, as well as provides public and private debt and equity placement solutions, to companies, institutions and governments. Since its founding in 2007, Moelis has advised on over $3.8 trillion of transactions involving some of the world s largest and most complex mergers and acquisitions and restructurings and recapitalizations. During this period, over $1.3 trillion of Moelis transaction volume was financial sponsor related demonstrating Moelis deep private equity relationships. Moelis actively covers approximately 400 middle-market and large-capitalization private equity groups that represent approximately $1 trillion of committed capital and $10 trillion in assets under management. Moelis has an extensive global relationship network with approximately 135 Managing Directors and approximately 1,000 total employees serving clients from over 20 geographic locations around the world. Prior to founding Moelis & Company, Mr. Moelis worked at UBS from 2001 to 2007, where he was most recently President of UBS Investment Bank and previously Joint Global Head of Investment Banking. During his time at UBS, Mr. Moelis led the transformation of the Investment Banking Department from a European focused platform to a leading global bulge bracket investment bank. Before joining UBS, Mr. Moelis was Head of Corporate Finance at Donaldson, Lufkin & Jenrette ( DLJ ), where he worked from 1990 through 2000. Mr. Moelis was integral in DLJ becoming the number one underwriter of high yield bonds in the 1990 s and rapidly growing its merger and acquisition and equity underwriting franchises. Mr. Moelis began his career as an investment banker with Drexel Burnham Lambert in 1981. Mr. Moelis serves on the University of Pennsylvania Board of Trustees, the Wharton Board of Overseers, the Ronald Reagan UCLA Medical Center Board of Advisors and was formerly Chair and Director on the Tourette Association of America Board. Mr. Spellacy has extensive experience in technology, data and analytics, capital markets and private equity and has worked as an investor, investment banker and consultant. Most recently, Mr. Spellacy was a Senior Managing Director at Accenture plc and Global Industry Leader of Accenture Capital Markets where he was responsible for the industry group s overall vision, strategy and investment priorities while overseeing Accenture s Asset Management, Wealth Management and Investment and Trading businesses. Accenture plc is a multinational Fortune Global 500 professional services firm with 2021 revenues of over $50 billion. Prior to Accenture, Mr. Spellacy was a Partner at Broadhaven Capital, a prominent independent investment bank and private equity investor servicing the financial services and technology sectors. Previously, TABLE OF CONTENTS TABLE OF CONTENTS Summary 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated certificate of incorporation refers to our second amended and restated certificate of incorporation to be adopted in connection with the closing of this offering; common stock are to our Class A common stock and our Class B common stock; Company refers to RF Acquisition Corp.; DGCL refers to the Delaware General Corporation Law as the same may be amended from time to time; directors are to our current directors and director nominees; EarlyBirdCapital is EarlyBirdCapital, Inc., the underwriter in this offering; founder shares are to shares of Class B common stock initially purchased by our sponsor in a private placement prior to this offering and the shares of Class A common stock that will be issued upon the automatic conversion of the shares of Class B common stock at the time of our initial business combination as described herein; initial stockholders are to holders of our founder shares prior to this offering; insiders are the officers, directors, advisors, and initial stockholders in the Company; management or our management team are to our executive officers and directors; private placement warrants are to the warrants issued to our sponsor, insiders, and EarlyBirdCapital each in a private placement simultaneously with the closing of this offering; public shares are to shares of Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder s and member of our management team s status as a public stockholder will only exist with respect to such public shares; public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market), to the private placement warrants if held by third parties other than our sponsor or the underwriter (or permitted transferees), in each case, following the consummation of our initial business combination; EBC founder shares are to shares of Class A common stock that were issued to EarlyBirdCapital prior to this offering at $0.0001 per share; rights are to the rights sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market), each to receive one-tenth (1/10) of one Class A common stock upon the consummation of an initial business combination; RFAC are to the Company; sponsor are to RF Dynamic LLC, a Delaware limited liability company, an affiliate of the Company; units are to units sold in this offering, each consisting of one Class A common stock, one redeemable warrant and one right; and we, us, company or our company are to RF Acquisition Corp., a Delaware corporation. Unless we tell you otherwise, the information in this prospectus assumes that the underwriter will not exercise its over-allotment option. TABLE OF CONTENTS If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non- accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. CALCULATION OF REGISTRATION FEE Title of Each Class of Security Being Registered Amount Being Registered Proposed Maximum Offering Price per Security(1) Proposed Maximum Aggregate Offering Price(1) Amount of Registration Fee Units, each consisting of one share of Class A common stock, $0.0001 par value, one redeemable warrant, and one right to receive one-tenth of one share of Class A common stock (2) 11,500,000 Units $ 10.00 $ 115,000,000 $ 10,661 Shares of Class A common stock included as part of the units (3) 11,500,000 Shares (4) Redeemable Warrants included as part of the units (3) 11,500,000 Warrants (4) Rights included as part of the units 11,500,000 Rights (4) Shares of Class A common stock underlying the Redeemable Warrants included as part of the Units 11,500,000 Shares $ 11.50(5) $ 132,250,000 $ 12,260 EBC founder shares of Class A common stock 200,000 Shares $ 0.0001 $ 20 $ 0.002 Shares of Class A common stock underlying the Rights included as part of the Units 1,150,000 Shares $ 10.00 $ 11,500,000 $ 1,066 Total $ 258,750,020 $ 23,987(6) (1) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(a) under the Securities Act of 1933, as amended (the Securities Act ). (2) Includes 1,500,000 units, consisting of (i) 1,500,000 shares of Class A common stock, 1,500,000 redeemable warrants, which may be issued upon exercise of a 45-day option granted to the underwriter to cover over-allotments, if any; and (ii) 1,500,000 rights, with each right entitling the holder to receive one-tenth of one Class A common stock upon the closing of the business combination. (3) Pursuant to Rule 416, there are also being registered an indeterminable number of additional securities as may be issued to prevent dilution resulting from stock splits, stock dividends or similar transactions. (4) No fee pursuant to Rule 457(g). (5) Calculated pursuant to Rule 457(g) under the Securities Act, based on the price of the warrants. (6) Previously paid. RF Acquisition Corp. (the Registrant ) hereby amends this registration statement (the Registration Statement ) on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. TABLE OF CONTENTS GENERAL We are a blank check company incorporated as a Delaware corporation whose business purpose is to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. We may pursue an initial business combination target in any industry or geographic region. We shall not undertake our initial business combination with any entity with its principal business operations in China (including Hong Kong and Macau). OVERVIEW While we may pursue an initial business combination target in any business, industry or geographic location, we intend to search globally for target companies within the Southeast Asian new economy sector or elsewhere. Our management team believes that in recent years, a wide range of technological breakthroughs have accelerated cycles of change, radically impacting industries and business models across the world. The transformative effects of innovation as diverse as cloud computing, artificial intelligence, machine learning, data analytics, cybersecurity, and ubiquitous mobile computing have upended industries both large and small. We believe the current COVID-19 pandemic has accelerated the aforementioned trend and is a catalyst for digital migration at a speed and on a scale never seen before. Individuals as well as small and large institutions have been forced to adapt to a new normal of living in a world where physical contact has been hindered and technology has become essential for both personal and business activities on a daily basis. Amidst these changes, we believe legacy business models that fail to adapt will eventually cease to exist while innovators that take advantage of the current situation will be awarded outsized opportunities to lead the upcoming changes. Our management team believes that this widespread change is occurring everywhere in our lives, but it has been particularly strong in the business world. Major shifts are happening in the financial services, media, technology, retail, interpersonal communication, transportation, and education sectors. We believe the market rewards those who see and understand its trajectory. Capital markets have responded to this expanding opportunity. Global venture capital investments increased over 500% in the past decade, from $48 billion in 2010 to $295 billion in 2019, according to Crunchbase News. Those dollars are spread widely: more than 32,000 companies received venture funding in 2019 alone, according to Crunchbase News. These backings represent a significant commitment from investors PWC/CB Insights recorded 219 private financings surpassing $100 million for private investments in 2019, representing over $50 billion deployed. This confluence of enormous change and plentiful capital has created what we believe is a sizeable opportunity for wealth building, especially as private companies enter the public markets to fuel their next phase of growth. Our management team believes that there is demand from public market investors to locate and invest in a high growth financial services, media, technology, retail, interpersonal communication, transportation, or education sectors company, debut it in the public markets and partner with it, as stockholders, to help the company elevate itself into the next multi-billion-dollar market cap company. Management Team Our team possess a wide-ranging set of competencies, including public market experience, financial acumen and an extensive track record of growth and value creation. Tse Meng Ng, our Chairman and Chief Executive Officer, is a highly regarded and successful financier and businessman. In February 2019, Mr. Ng co-founded Ruifeng Wealth Management Pte Ltd, a Singapore Capital Markets Services licensed financial institution regulated by the Monetary Authority of Singapore for which he serves as the chief executive officer. Ruifeng Wealth Management Pte Ltd is a subsidiary of listed 2345 Network Technological Co. Ltd ( 2345 Network ). 2345 Network has a market capitalization of around $2 billion. Mr. Ng and his team provide fund management services to ultra high net worth individuals. From May 2014 to January 2019, Mr. Ng served as the Managing Director of Credit Agricole, an international full-service banking group. He was voted Outstanding Young Private Banker in 2011 by Private Banker TABLE OF CONTENTS The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED MARCH 15, 2022 PRELIMINARY PROSPECTUS $100,000,000 RF Acquisition Corp. 10,000,000 Units RF Acquisition Corp. is a blank check company whose business purpose is to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. We shall not undertake our initial business combination with any entity with its principal business operations in China (including Hong Kong and Macau). This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one share of Class A common stock, one redeemable warrant, and one right to receive one-tenth of one Class A common stock upon the consummation of an initial business combination. Each whole warrant entitles the holder thereof to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment as described herein. Only whole warrants, shares, and rights are exercisable. No fractional warrants, nor shares, nor rights will be issued upon separation of the units and only whole warrants, shares, and rights will trade. The warrants will become exercisable 30 days after the completion of our initial business combination, and will expire five years after the completion of our initial business combination or earlier upon redemption or our liquidation, as described herein. The underwriter has a 45-day option from the date of this prospectus to purchase up to 1,500,000 additional units to cover over-allotments, if any. Accordingly, you must hold rights in multiples of 10 in order to receive shares for all of your rights upon closing of a business combination. We will provide our public stockholders with the opportunity to redeem all or a portion of their shares of Class A common stock upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding shares of Class A common stock that were sold as part of the units in this offering, which we refer to collectively as our public shares, subject to the limitations and on the conditions described herein. If we are unable to complete our initial business combination within 12 months, or if we decide to extend the period of time to consummate our business combination up to two times by an additional three months each time, at $0.10 per extension, for a total of $0.20 aggregate in trust, within 18 months (the Extension Option ), from the closing of this offering, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions as further described herein. In the event the Company decides to exercise the Extension Option, investors will not have voting rights nor redemption rights in connection with such additional three-month extensions. Holders of record of our Class A common stock and holders of record of our Class B common stock will vote together as a single class on all matters submitted to a vote of our stockholders except as required by law and as disclosed herein, with each share of common stock entitling the holder to one vote except as required by law and as disclosed herein. Prior to our initial business combination, only holders of our Class B common stock will have the right to vote on the appointment of directors. Holders of our public shares will not be entitled to vote on the appointment of directors during such time. RF Dynamic LLC, a Delaware limited liability company, which we refer to throughout this prospectus as our sponsor, and EarlyBirdCapital, Inc., the representative of the underwriters in this offering, which we refer to throughout this prospectus as EarlyBirdCapital, have committed that they and/or their designees will purchase from us an aggregate of 4,550,000 warrants, or private warrants, at $1.00 per warrant (4,050,000 private warrants by our sponsor and 500,000 private warrants by EarlyBirdCapital) for a total purchase price of $4,550,000 in a private placement that will occur simultaneously with the consummation of this offering. Our sponsor and EarlyBirdCapital have also agreed that if the over-allotment option is exercised by the underwriter in full or in part, they will purchase from us additional private warrants on a pro rata basis (up to a maximum of 450,000 private warrants at a price of $1.00 per warrant) in an amount that is necessary to maintain in the trust account $10.10 per unit sold to the public in this offering. These additional private warrants will be purchased in a private placement that will occur simultaneously with the purchase of units resulting from the exercise of the over-allotment option. The private warrants are identical to the warrants sold in this offering, subject to certain limited exceptions as described in this prospectus. Our initial stockholders currently own an aggregate of 2,875,000 shares of Class B common stock (up to 375,000 shares of which are subject to forfeiture depending on the extent to which the underwriter s over-allotment option is exercised), which will automatically convert into shares of Class A common stock concurrently with or immediately following the consummation of our initial business combination on a one-for-one basis, subject to the adjustments described herein. Currently, there is no public market for our units, Class A common stock, rights, or warrants. We expect that our units will be listed on The Nasdaq Global Market, or Nasdaq, under the symbol RFACU on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on Nasdaq. We expect the shares of Class A common stock, rights, and warrants comprising the units to begin separate trading on the 90th day following the date of this prospectus unless EarlyBirdCapital, Inc. informs us of its decision to allow earlier separate trading, subject to our satisfaction of certain conditions. Once the securities comprising the units begin separate trading, we expect that the Class A common stock, rights, and warrants will be listed on Nasdaq under the symbols RFAC, RFACR, and RFACW, respectively. We are an emerging growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 32 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 100,000,000 Underwriting discounts and commissions(1) $ 0.20 $ 2,000,000 Proceeds, before expenses, to RF Acquisition Corp. $ 9.80 $ 98,000,000 (1) $0.20 per unit, or $2,000,000 in the aggregate (or $2,300,000 if the underwriter s over-allotment option is exercised in full), is payable upon the closing of this offering. The underwriter will receive compensation in addition to the underwriting discount, including 200,000 Class A common stock, which we refer here in as to EBC founder shares . Please see the section titled Underwriting for further information relating to the arrangements agreed to between us and the underwriter. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $101,000,000, or $116,150,000 if the underwriter s over-allotment option is exercised in full ($10.10 per unit in either case), will be deposited into a trust account in the United States with Continental Stock Transfer & Trust Company acting as trustee. The underwriter is offering the units for sale on a firm commitment basis. The underwriter expects to deliver the units to the purchasers on or about , 2022. Book-Running Manager EarlyBirdCapital, Inc. , 2022 TABLE OF CONTENTS International, the leading journal for the global wealth management industry. Prior to that, Mr. Ng was a Director at Credit Suisse where he helped form the team that covered the North Asia markets and where he helped contribute the most net new money between 2008-2009. He started his career in 1998 at Citibank N.A where he managed a team of banking staff at a very young age. Mr. Ng earned a B.S. in Business from Nanyang Technological University. Han Hsiung Lim, our Chief Financial Officer and Chief Operating Officer, is an accomplished executive and leader. Mr. Lim has served on our board of directors since January 2021. Mr. Lim retired from an 18-year career in the banking and asset management industry in 2018 and has since managed his own investments in public equities and fixed-income securities. From January 2016 to December 2017, Mr. Lim was a Senior Vice President in the Risk & Performance Management Department at GIC (formerly known as the Government of Singapore Investment Corporation), which manages Singapore s foreign reserves. From April 2009 to December 2014, he served as the Head of Credit Risk Management in the Risk & Performance Management Department at GIC where he was responsible for approving, managing and mitigating the firmwide credit exposure of GIC to its trading counterparties. From February 2000 to April 2009, Mr. Lim worked within the Financial Markets Credit Group at DBS Bank, where rose up the ranks to Vice President in 2005 and was responsible for approving, managing and mitigating the firmwide credit exposure of DBS Bank to a portfolio of banks and non-bank financial institutions. He also has experience in managing credit exposure, as he was tasked with avoiding and mitigating DBS Bank s potential losses during the 2008 Global Financial Crisis. Mr. Lim has a bachelor of business degree (First Class Honors), with a major in banking and a minor in hospitality, from the Nanyang Technological University. Our Board Our officer s skills are complemented by our directors and advisors, who bring significant operating experience and relationships throughout the global banking and finance industry. In addition to Tse Meng Ng, who is Chairman of our board, and Benjamin Waisbren, Simon Eng Hock Ong, and Vincent Yang Hui are our additional director nominees. Benjamin Waisbren has served on our board of directors since January 2021. Since 2014, Mr. Waisbren has served as the President of Virtually There Holdings LLC d/b/a Ben Waisbren & Associates, which advises media companies and firms involved in distressed situations. From April 2019 through July 2020, Mr. Waisbren served as Chief Executive Officer and Chief Restructuring Officer of NanoMech Inc., a nanotechnology company that he led through a Chapter 11 case and its sale to a global company. He is also on the board of Vistas Media Acquisition Company, a Nasdaq listed blank check company, and previously served on the board of Wild Bunch AG, the German-listed, Paris-based award-winning film co-production and distribution company for ten years. Mr. Waisbren also held attorney positions at Lord Bissell & Brook LLP (now Locke Lord LLP) and Winston & Strawn LLP, during and after which he was engaged by the U.S. Department of Justice in the 1Malaysia Development Berhad money laundering matter. Mr. Waisbren s impressive legal and business career make him an excellent candidate for our board of directors. Simon Eng Hock Ong will serve on our board of directors following the completion of this offering. Mr. Ong currently serves as the Chief Financial Officer of Rich Capital Holdings Limited, a company listed on SGX Catalist. Prior thereto, Mr. Ong worked as the Executive Director of Asiaphos Limited from 2012 through June 2019, and remains as with Asiaphos as a Non-Executive Director and as a member of their audit committee. Previously, Mr. Ong also served as Group Finance Manager and as Chief Financial Officer of Hwa Hong Corporation Limited, a company listed on SGX-ST Main Board, and as a director of corporate and financial planning of the King George Development Corporation, a company listed on the TSX Venture Exchange (formerly known as the Vancouver Stock Exchange). Mr. Ong has a degree in accounting from North East London Polytechnic (now known as the University of East London) and is a Fellow of the Association of Chartered Certified Accountants and a Certified Practicing Accountant in Australia. Mr. Ong s experience working with public companies and his strong background in finance and accounting make him a strong candidate to serve on our board of directors. Vincent Yang Hui will serve on our board of directors following the completion of this offering. Mr. Hui currently serves as the Chief Executive Officer of abComo eCommerce Pte Ltd, a multinational influencer platform that he founded in 2020. He also co-founded Long-bridge, an overseas asset investment company, in 2019, and Alphabit Consulting Pte Ltd, a Singapore based technology consulting company. From 2014 to TABLE OF CONTENTS 2018, Mr. Hui served as a Business Development Director for the Alibaba Group and Ant Financial. Mr. Hui has a BSc in Information Management and Information Systems from the University of Electronic Science and Technology of China and a graduate diploma in systems analysis from the National University of Singpaore. Mr. Hui s qualifications to serve on our board of directors includes his entrepreneurial experiences and educational background. Our Advisors In addition to the management team and board of directors, our team will include Chandra Tjan and Stephen Lee, who shall serve as advisors. None of these individuals have any contractual obligation to us or are otherwise required to commit any specified amount of time to our affairs; however, we expect that certain of these individuals will, on average, dedicate a significant amount of their professional time on our affairs. Chandra Tjan is a heralded entrepreneur with a record of success as a venture capitalist in Southeast Asia. Mr. Tjan started his career as a banker at Citigroup and Credit Suisse in Singapore. After a decade in the banking industry, Mr. Tjan saw a huge opportunity in Indonesia s technology sector, and in 2009 he co-founded East Ventures, an early stage capital venture firm. During his tenure in Indonesia, Mr. Tjan was responsible for dozens of investments in early-stage start-ups, including the online marketplace Tokopedia and all-in-one travel booking platform Traveloka. In 2015, Chandra co-founded Alpha JWC Ventures, an institutionalized and independent VC fund targeting early-stage tech startups across Southeast Asia, with a strong focus in Indonesia. The firm currently manages approximately $200 million across two funds, making it the largest early-stage fund in Indonesia, with 36 active portfolio companies. With over a decade of experience in tech investment, Mr. Tjan has invested in over 60 companies in Asia and the United States. He currently sits on the board of some of the leading tech companies in Asia, including FundingSocieties, Carro, GudangAda, Bobobox and OnlinePajak. Mr. Tjan graduated from The University of Sydney with a triple major in finance, economics, and management, currently attends the Owner-President Management (OPM) Program at Harvard Business School, a 3-year residential program for business owners and entrepreneurs, and is a member of YPO s (Young President Organization) global leadership community. Stephen Lee is an experienced and respected executive with experience across a wide variety of sectors and industries. In 1994, Mr. Lee joined AIF Capital and has been a Partner and Investment Committee Member since 2001. He has been actively involved in deal origination, transaction execution, investment management and portfolio monitoring and represents AIF Capital on the boards of various portfolio companies. His sector investment experience includes manufacturing, industrial, media, pharmaceutical and healthcare, aquaculture, consumer, new materials, telecommunication, logistics and transportation in multiple countries, including China, Hong Kong, Taiwan, Indonesia, South Korea and Singapore. Mr. Lee has been involved in multiple prominent deals in the Asia-Pacific region, including Aofeng Hi-Tech Company Limited (the largest carbon fiber composite company manufacturer in Asia), Oceanus Group Limited (the Singapore-listed leading aquatic company in Asia), CN Innovations Holdings Limited (the leading smartphone manufacturer in China and Asia), Shandong Buchang Pharmaceutical Co. Ltd. (China s largest producer of traditional Chinese medicine), Charm Communications Inc. (a leading Chinese media company in China that was previously listed in the United States), Bharti Infratel Limited (India s largest mobile operator in India), Bestime Pharma (Asia) Limited (leading antibiotics drug manufacturer in China), PT Excelcomindo Pratama (leading mobile operator in Indonesia) and PT Marga Mandalasakti (operators of the longest toll road in Indonesia). Business Strategy Our business strategy is to identify and consummate an initial business combination with a company with operations or prospects in the Southeast Asian new economy sector or elsewhere. We shall not undertake our initial business combinations with any entity with its principal business operations in China (including Hong Kong and Macau). We intend to focus on companies that complement the experience of our management team and that can benefit from the management team s operational expertise. Our selection process will leverage our management team s broad and deep network of relationships, industry expertise and proven deal-sourcing capabilities, providing us with a strong pipeline of potential targets. Our management and sponsor have experience in: investing and building businesses in the financial services, media, technology, retail, interpersonal communication, transportation, and education sectors with unique market, policy and macroeconomic insights; TABLE OF CONTENTS managing and operating companies, setting and changing strategies, and identifying, mentoring and recruiting top-notch talent; developing and growing companies, both organically and inorganically, and expanding the product ranges and geographic footprints of portfolio businesses; executing merger and acquisition strategies to accelerate growth and create integrated value chains; sourcing, structuring, acquiring and selling businesses in various markets; partnering with other industry-leading companies to increase sales and improve the competitive position of companies; fostering relationships with users, sellers, capital providers and target management teams; and accessing the capital markets, including capital sources in Asia and America, across various business cycles, including financing businesses and assisting companies with the transition to public ownership. Business Combination Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, though we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines: Companies with operations or prospects in the Southeast Asian new economy sectors or elsewhere. Based upon our management team s experience, we believe we will have increased access to investment opportunities and a competitive advantage in our ability to negotiate a business combination with potential targets in the Southeast Asian new economy. Our management team s extensive experience and network of contacts provide them with an opportunity to source a target, evaluate a target, consummate a business combination with the target and help grow the target s business. Strong target management teams. We intend to acquire one or more businesses that have strong management teams with a proven track record of driving growth, building long-term competitive advantage and making sound strategic decisions. Fundamentally sound companies that have the potential to further improve their performance under our ownership. We believe our management team s experience in our target sectors as well as their network of industry contacts will create opportunities to enhance the revenue and operational efficiencies of the target business, and potentially generate higher returns for our investors. Market leader. We intend to seek a target that has a leading presence across an industry or segment or has leading technology or product capabilities. Appropriate valuations. We intend to be a disciplined and valuation-centric investor that will invest on terms that we believe are attractive relative to market comparables that provide significant upside potential. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. If we decide to enter into a business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our stockholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials, as applicable, that we would file with the SEC. Our Business Combination Process In evaluating a prospective target business, we expect to conduct a thorough due diligence review that will encompass, among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities, as well as reviewing financial and other information that will be made available to us. We will also utilize our operational and capital allocation experience. TABLE OF CONTENTS Our acquisition criteria, due diligence processes and value creation methods are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. If we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our stockholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC. Our Business Strategy Our business strategy is to identify and consummate an initial business combination with a company with operations or prospects in the Southeast Asian new economy sector or elsewhere. We intend to focus on companies that complement the experience of our management team and that can benefit from the management team s operational expertise. Our selection process will leverage our management team s and our sponsor s broad and deep network of relationships, industry expertise and proven deal-sourcing capabilities, providing us with a strong pipeline of potential targets. Our management and sponsor have experience in: investing and building businesses in the financial services, media, technology, retail, interpersonal communication, transportation, and education sectors with unique market, policy and macroeconomic insights; managing and operating companies, setting and changing strategies, and identifying, mentoring and recruiting top-notch talent; developing and growing companies, both organically and inorganically, and expanding the product ranges and geographic footprints of portfolio businesses; executing merger and acquisition strategies to accelerate growth and create integrated value chains; sourcing, structuring, acquiring and selling businesses in various markets; partnering with other industry-leading companies to increase sales and improve the competitive position of companies; fostering relationships with users, sellers, capital providers and target management teams; and accessing the capital markets, including capital sources in Asia and America, across various business cycles, including financing businesses and assisting companies with the transition to public ownership. Permission Required from the PRC Authorities for this Offering and a Business Combination As a Delaware corporation with no operations in China, we are not required to obtain permission from any Chinese authorities to operate or to issue the securities being issued in this offering to any investors, including Chinese investors, if any, and we do not expect the permission will be required from the Chinese authorities in connection with our business combination since we will not undertake our initial business combination with any entity that conducts a majority of its business or is headquartered in China (including Hong Kong and Macau). INITIAL BUSINESS COMBINATION Nasdaq rules require, and our amended and restated certificate of incorporation will require, that we must complete one or more initial business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding taxes payable on interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm which is a member of FINRA or a valuation or appraisal firm with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market TABLE OF CONTENTS value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of the target s assets or prospects. We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In that case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test described above. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the Securities and Exchange Commission (the SEC ) to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended (the Exchange Act ). As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. SOURCING OF POTENTIAL INITIAL BUSINESS COMBINATION TARGETS We believe our management team s significant operating and transaction experience and relationships will provide us with a substantial number of potential initial business combination targets. Over the course of their careers, the members of our management team have developed a broad network of contacts and corporate relationships around the world, which includes private equity firms, venture capitalists and entrepreneurs. This global network has grown through the activities of our management team sourcing, acquiring and financing businesses, the reputation of our management team for integrity and fair dealing with sellers, financing sources and target management teams and the experience of our management team in executing transactions under varying economic and financial market conditions. In addition, members of our management team and board of directors have developed contacts from serving on the boards of directors of public companies. However, we shall not undertake our initial business combination with any entity with its principal business operations in China (including Hong Kong and Macau). This global network has provided our management team with a flow of referrals that has resulted in numerous transactions which were proprietary or where a limited group of investors were invited to participate in the sale process. We believe that the network of contacts and relationships of our management team will provide us important sources of investment opportunities. In addition, we anticipate that target business combination candidates will be brought to our attention from various unaffiliated sources, including investment market participants, private equity funds and large business enterprises seeking to divest non-core assets or divisions. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, executive officers or directors, or completing the business combination through a joint venture or other form of shared ownership with our sponsor, executive officers or directors. If we seek to complete an initial business combination with a target that is affiliated with our sponsor, executive officers or directors, we, TABLE OF CONTENTS or a committee of independent directors, would obtain an opinion from an independent investment banking firm which is a member of FINRA or a valuation or appraisal firm stating that such an initial business combination is fair to our company from a financial point of view. Members of our management team and our independent directors will directly or indirectly own founder shares, common stock, rights, and/or private placement warrants following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to another entity pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such other entity. Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation. We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our initial business combination. In addition, our sponsor and our officers and directors may sponsor or form other special purpose acquisition companies similar to ours or may pursue other business or investment ventures during the period in which we are seeking an initial business combination. Any such companies, businesses or investments may present additional conflicts of interest in pursuing an initial business combination. However, we do not believe that any such potential conflicts would materially affect our ability to complete our initial business combination. CORPORATE INFORMATION Our executive offices are located at 111 Somerset, #05-06, Singapore 23864, and our telephone number is +65 6904 0766. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and TABLE OF CONTENTS (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non- affiliates exceeds $250 million as of the prior June 30th, or (2) our annual revenues exceed $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as of the prior June 30th. TABLE OF CONTENTS
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: Acquisition Advisory Council and AAC are to our Acquisition Advisory Council, which will assist us in sourcing and evaluating transaction opportunities; amended and restated certificate of incorporation are to our amended and restated certificate of incorporation to be filed and in effect upon the completion of this offering; board of directors and our board are to the board of directors of our company; common stock are to our Class A common stock and our Class B common stock; company or our company are to Stillwater Growth Corp. I, a Delaware corporation; DBO Partners are to DBO Partners LLC, a subsidiary of DBO Partners Holdings LLC, which is the parent company of DBO Partners Acquisition LLC, a member of our sponsor; founder shares are to shares of our Class B common stock initially purchased by our sponsor in a private placement prior to this offering and the shares of our Class A common stock issued upon the automatic conversion thereof at the time of our initial business combination as provided herein; initial stockholders are to our sponsor and other holders of our founder shares prior to this offering; letter agreement are to the letter agreement, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management, our management team or our team are to our officers and directors, and directors are to our current directors and director nominees; our officers are to the officers of our company; private placement warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our sponsor, officers and directors to the extent our sponsor, officers or directors purchase public shares, provided that each of their status as a public stockholder shall only exist with respect to such public shares; sponsor are to D Squared Sponsor LLC, a Delaware limited liability company, which is affiliated with George J. Still, Jr., David W. Dorman, G. Douglas Dillard, Jr., and DBO Partners Acquisition LLC, or DBO Acquisition; Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION DATED APRIL 25, 2022 PRELIMINARY PROSPECTUS STILLWATER GROWTH CORP. I $200,000,000 20,000,000 units Stillwater Growth Corp. I is a newly incorporated blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not scheduled any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one share of our Class A common stock and one-third of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one share of our Class A common stock at a price of $11.50 per whole share, subject to adjustment as provided herein, and only whole warrants are exercisable. The warrants will become exercisable on the date that is 30 days after the completion of our initial business combination, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. Subject to the terms and conditions described in this prospectus, we may redeem the warrants once the warrants become exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We have also granted the underwriters a 45-day option from the date of this prospectus to purchase up to an additional 3,000,000 units to cover over-allotments, if any. We will provide our public stockholders with the opportunity to redeem all or a portion of their shares of our Class A common stock upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below, calculated as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account (net of taxes payable), divided by the number of then outstanding shares of Class A common stock that were sold as part of the units in this offering, which we refer to collectively as our public shares, subject to the limitations described herein. If we have not completed our initial business combination within 24 months from the closing of this offering we will redeem 100% of the public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (net of taxes payable and less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions as further described herein. Our sponsor, D Squared Sponsor LLC, has committed to purchase an aggregate of 3,933,333 warrants (or 4,233,333 warrants if the underwriters over-allotment option is exercised in full) at a price of $1.50 per warrant ($5,900,000 in the aggregate, or $6,350,000 in the aggregate if the underwriters over-allotment option is exercised in full), each exercisable to purchase one share of our Class A common stock at a price of $11.50 per share, in a private placement that will close simultaneously with the closing of this offering. Our initial stockholders own 5,750,000, subject to adjustment, shares of Class B common stock (up to 750,000 of which are subject to forfeiture by our initial stockholders on a pro-rata basis depending on the extent to which the underwriters over-allotment option is exercised). The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of our initial business combination on a one-for-one basis, subject to adjustment as provided herein. Only holders of Class B common stock will have the right to vote on the election of directors and to remove directors prior to our initial business combination, and such rights may only be amended by a resolution passed by the holders of a majority of the outstanding shares of our Class B common stock. On all other matters submitted to a vote of our stockholders, holders of the Class B common stock and holders of the Class A common stock will vote together as a single class, with each share of common stock entitling the holder to one vote, except as required by law or the applicable rules of the Nasdaq Stock Market ( Nasdaq ) then in effect. Prior to this offering, there has been no public market for our units, Class A common stock or warrants. We intend to apply to list our units on Nasdaq, under the symbol SWGCU on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on Nasdaq. The Class A common stock and warrants constituting the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless BofA Securities, Inc. ( BofA Securities ) informs us of its decision to allow earlier separate trading, subject to our satisfaction of certain conditions. Once the securities constituting the units begin separate trading, we expect that the Class A common stock and warrants will be listed on Nasdaq under the symbols SWGC and SWGCW, respectively. We are an emerging growth company and smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves risks. See Risk Factors on page 42. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Per unit Total Public offering price $ 10.00 $ 200,000,000 Underwriting discounts and commissions(1)(2) $ 0.55 $ 11,000,000 Proceeds, before expenses, to us $ 9.45 $ 189,000,000 (1) Includes $0.35 per unit, or $7,000,000 (or up to $8,050,000 if the underwriters over-allotment option is exercised in full) in the aggregate, payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein. Does not include certain fees and expenses payable to the underwriters in connection with this offering. See also Underwriting for a description of compensation and other items of value payable to the underwriters. (2) The underwriters have agreed to reimburse us for a portion of our offering expenses. See Underwriting. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $200.0 million, or $230.0 million if the underwriters over-allotment option is exercised in full ($10.00 per unit in either case), will be deposited into a U.S.-based trust account with Continental Stock Transfer & Trust Company acting as trustee, and $2,900,000 will be available to pay fees and expenses in connection with this offering and for working capital following this offering. The underwriters are offering the units for sale on a firm commitment basis. Delivery of the units will be made on or about , 2022. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. BofA Securities The date of this prospectus is , 2022 Table of Contents Stillwater are to our company; warrants are to our warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and the private placement warrants; and we, us or our are to our company, or, where applicable, members of our management team. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. General Stillwater Growth Corp. I is a newly organized blank check company incorporated in Delaware for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization, or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We believe we have assembled a highly differentiated team including our sponsor, board of directors, AAC and management team, which brings senior operating executive experience, deal flow, transaction execution expertise, investing experience, governance, and access to additional capital. The team includes past and current CEOs of Acuity Brands, AT&T, IBM, Silicon Graphics, Walmart Global eCommerce, and Workday; past and current CEOs and senior partners of investment firms including Coatue Management, Franklin Templeton Investments, Norwest Ventures, Redpoint Partners, Silver Lake Partners, Standard Pacific Capital, and Temasek; past and current board members of numerous technology leaders; and current bankers and lawyers with extensive transaction and governance expertise. Collectively, our team has extensive networks to help us source and evaluate attractive, high-growth technology or technology-enabled companies. Our team provides broad based expertise with technology companies spanning early-stage growth startups through large, multi-national industry leaders and a track record of investment success. We believe our team offers potential deal flow, operating experience and global networks, investment expertise spanning public and private markets, capital access, M&A and governance experience. Combined with DBO Partners technology investment banking practice, we believe this expertise and resource infrastructure provides us a competitive advantage as we source, diligence and negotiate a business combination. Certain members of our team may invest directly in any private investment in public entity ( PIPE ) transaction associated with a merger as a vote of such confidence. In addition, certain members of our team may remain engaged with our business target post-combination in a governance or advisory capacity. Amidst an increasingly competitive market for attractive business combinations, we believe our team s experience and network may make us an attractive partner for a potential business combination. Sponsor The sponsor is primarily responsible for forming and funding our company. Thereafter, the sponsor, together with management, will be responsible for originating investment opportunities, evaluating the investment pipeline and executing acquisition and financing transactions. Members of our sponsor have significant deal sourcing, management and transaction execution experience: G. Douglas Dillard, Jr.: Former Co-Managing Partner of Standard Pacific Capital. David W. Dorman: Former CEO of AT&T, current Chairman of CVS Health. Table of Contents We are responsible for the information contained in this prospectus. We have not, and the underwriters have not, authorized anyone to provide any information or to make any representations other than those contained in this prospectus. We and the underwriters take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the units offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date. TABLE OF CONTENTS Page Summary 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: we, us, company or our company are to 10X Capital Venture Acquisition Corp. III, a Cayman Islands exempted company; Cantor are to Cantor Fitzgerald & Co., the representative of the underwriters of this offering. Companies Act refers to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; directors are to our current directors and director nominees; founder shares are to Class B ordinary shares initially purchased by our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination as described herein; initial shareholders are to holders of our founder shares prior to this offering; management or our management team are to our executive officers and directors; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; public shares are to Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders are to the holders of our public shares, including our initial shareholders and management team to the extent our initial shareholders and/or members of our management team purchase public shares, provided that each initial shareholder s and member of our management team s status as a public shareholder will only exist with respect to such public shares; private placement shares are to Class A ordinary shares sold as part of the private placement units; private placement units are to the units issued to our sponsor and the underwriters in a private placement simultaneously with the closing of this offering, which private placement units are identical to the units sold in this offering, subject to certain limited exceptions as described in this prospectus; private placement warrants are to the warrants sold as part of the private placement units; sponsor are to 10X Capital SPAC Sponsor III LLC, a Cayman Islands limited liability company. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED JANUARY 4, 2022 PRELIMINARY PROSPECTUS $250,000,000 10X Capital Venture Acquisition Corp. III 25,000,000 Units 10X Capital Venture Acquisition Corp. III is a blank check company incorporated as a Cayman Islands exempted company whose business purpose is to effect a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share and one-half of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as described herein. Only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. The warrants will become exercisable 30 days after the completion of our initial business combination, and will expire five years after the completion of our initial business combination or earlier upon redemption or our liquidation, as described herein. The underwriters have a 45-day option from the date of this prospectus to purchase up to 3,750,000 additional units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account (which interest shall be net of taxes payable), divided by the number of then outstanding Class A ordinary shares that were sold as part of the units in this offering, which we refer to collectively as our public shares, subject to the limitations and on the conditions described herein. If we are unable to complete our initial business combination within 12 months from the closing of this offering, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (which interest shall be net of taxes payable and up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions as further described herein. Our sponsor, 10X Capital SPAC Sponsor III LLC, has committed to purchase an aggregate of 806,000 private placement units (or 862,250 private placement units if the underwriters over-allotment option is exercised in full) and the representative of the underwriters of this offering, Cantor Fitzgerald & Co., has agreed to purchase 250,000 private placement units, for a combined aggregate of 1,056,000 units (or 1,112,250 private placement units if the underwriters over-allotment option is exercised in full), at a price of $10.00 per unit, for an aggregate purchase price of $10,560,000, (or $11,122,500 if the underwriters over-allotment option is exercised in full) in a private placement that will close simultaneously with the closing of this offering. The private placement units are identical to the units sold in this offering, subject to certain limited exceptions as described in this prospectus. Our initial shareholders currently own an aggregate of 9,583,333 Class B ordinary shares (up to 1,250,000 shares of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised), which will automatically convert into Class A ordinary shares concurrently with or immediately following the consummation of our initial business combination on a one-for-one basis, subject to the adjustments described herein. Only holders of Class B ordinary shares will have the right to (i) appoint directors in any election held prior to or in connection with the completion of our initial business combination and (ii) vote on continuing the company in a jurisdiction outside the Cayman Islands (including any special resolution required to amend the constitutional documents of the Company or to adopt new constitutional documents of the Company, in each case, as a result of the Company approving a transfer by way of continuation in a jurisdiction outside the Cayman Islands). On any other matters submitted to a vote of our shareholders, holders of the Class B ordinary shares and holders of the Class A ordinary shares will vote together as a single class, and except as required by law or the applicable rules of the NYSE then in effect. Currently, there is no public market for our units, Class A ordinary shares or warrants. We intend to apply to have our units listed on The New York Stock Exchange, or NYSE, under the symbol VCXB.U on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on NYSE. We expect the Class A ordinary shares and warrants comprising the units to begin separate trading on the 52nd day following the date of this prospectus unless Cantor Fitzgerald & Co. informs us of its decision to allow earlier separate trading, subject to our satisfaction of certain conditions. Once the securities comprising the units begin separate trading, we expect that the Class A ordinary shares and warrants will be listed on NYSE under the symbols VCXB and VCXB WS, respectively. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 34 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 250,000,000 Underwriting discounts and commissions(1) $ 0.65 $ 16,250,000 Proceeds, before expenses, to us $ 9.35 $ 233,750,000 (1) $0.20 per unit sold in the base offering, or $5,000,000 in the aggregate, is payable upon the closing of this offering. Includes $0.45 per unit sold in the base offering, or $11,250,000 in the aggregate, payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States and released to the underwriters only upon the completion of an initial business combination. If the underwriters over-allotment option is exercised, $0.65 per over-allotment unit, or up to an additional $2,437,500 or $13,687,500 in the aggregate if the underwriters over-allotment option is exercised in full, will be deposited in the trust account as deferred underwriting commissions and released to Cantor Fitzgerald & Co. for its own account only upon the completion of an initial business combination. See also Underwriting for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement units described in this prospectus, $253,750,000, or $291,812,500 if the underwriters over-allotment option is exercised in full ($10.15 per unit in either case), will be deposited into a trust account in the United States with Continental Stock Transfer & Trust Company acting as trustee, after deducting $5,000,000 in underwriting discounts and commissions payable upon the closing of this offering and an aggregate of $1.81 million to pay fees and expenses in connection with the closing of this offering and for working capital following the closing of this offering. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2021. Sole Book-Running Manager Cantor , 2021 Table of Contents GENERAL We are a blank check company whose business purpose is to effect a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. We believe that our management team s decades of experience and relationships with leading technology companies and their founders, executives and investors, in addition to the extensive industry and geographical reach of our network, along with our prior experience with special purpose acquisition company ( SPAC ) business combinations, will give us a competitive advantage in pursuing a broad range of opportunities in many industries. Although we may pursue an business combination opportunity in any business or industry, we currently intend to focus our efforts on identifying high growth technology and tech-enabled businesses domestically and abroad in the consumer internet, ecommerce, software, healthcare, transportation / mobility and financial services industries, as well as other industries that are being disrupted by advances in technology and on technology paradigms including artificial intelligence ( AI ), automation, data science, ecommerce and Software-as-a-Service ( SaaS ). OVERVIEW 10X Capital is a New York City-based investment firm which connects Wall Street with Silicon Valley, aligning institutional capital with high growth ventures. Founded in 2004 by serial entrepreneur Hans Thomas, 10X Capital invests alongside leading technology investors, with a focus on consumer-oriented software and technology companies disrupting major industries, including finance, healthcare, transportation and real estate, by leveraging advances in automation, artificial intelligence and data science. 10X Capital is a founder of 10X Capital Venture Acquisition Corp. ( 10X I ), a SPAC which consummated its business combination with REE Automotive, an electric vehicle technology company based in Israel, in July 2021. The combined company is listed on The Nasdaq Global Market under the ticker REE. In addition, 10X Capital is a founder of 10X Capital Venture Acquisition Corp. II ( 10X II ; Nasdaq: VCXA), a SPAC which consummated its initial public offering in August 2021. 10X Capital and its subsidiary, San Francisco-based venture capital firm Growth Technology Partners ( GTP ), are investors in over 100 high growth venture-backed companies such as Robinhood Markets, Inc. ( Robinhood ), Circle Internet Financial ( Circle ), Ripple, 23andMe, Headspace, Udemy and Pipefy. 23andMe recently announced its proposed business combination with a SPAC. 10X Capital has invested in these and other venture-backed companies alongside well-known venture capital funds such as Sequoia Capital ( Sequoia ), New Enterprise Associates ( NEA ), Ribbit Capital ( Ribbit ), General Catalyst Partners, Google Ventures ( GV ), Founders Fund and Fidelity Investments Inc. ( Fidelity ), Andreesen Horowitz, DST Global, Kleiner Perkins, Thiel Capital, Khosla Ventures, Norwest Venture Partners, Insight Partners, Bessemer Venture Partners, Social Capital, 8VC, DCM, TCV and Wellington. 10X Capital utilizes data science to identify and evaluate investments, as well as support portfolio companies strategic growth, and through its network of relationships with founders, executives and venture capitalists, routinely meets with a variety of high growth technology companies seeking investment or financing. 10X Capital has been an early and active investor in companies that have recently gone public or are reported to be in the process of going public, including biotech firm Compass Therapeutics, which completed a reverse merger transaction with a public shell company in June 2020. 10X Capital was also an investor in Palantir Table of Contents TABLE OF CONTENTS Page SUMMARY 1
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+summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under "Risk Factors" and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: "we," "us," "company" or "our company" are to Patria Latin American Opportunity Acquisition Corp., a Cayman Islands exempted company; "amended and restated memorandum and articles of association" are to the amended and restated memorandum and articles of association that the company will adopt prior to the consummation of this offering; "Companies Act" are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; "directors" are to our current directors and director nominees (if any); "equity-linked securities" are to any debt or equity securities that are convertible, exercisable or exchangeable for our Class A ordinary shares issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt; "founder shares" are to Class B ordinary shares initially purchased by our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination as described herein; "initial shareholders" are to holders of our founder shares prior to this offering; "management" or our "management team" are to our officers and directors (including our director nominees that will become directors in connection with the consummation of this offering) and advisory board members; "ordinary shares" are to our Class A ordinary shares and our Class B ordinary shares; "Patria" are to Patria Investments Limited; "private placement warrants" are to the warrants to be issued to our sponsor in a private placement simultaneously with the closing of this offering; "public shares" are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); "public shareholders" are to the holders of our public shares, including our initial shareholders and management team to the extent our initial shareholders and/or members of our management team purchase public shares, provided that each initial shareholder s and member of our management team s status as a "public shareholder" will only exist with respect to such public shares; "public warrants" are to the warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and to the private placement warrants if held by third parties other than out sponsor (or permitted transferees); "sponsor" are to Patria SPAC LLC, a Cayman Islands limited liability company; and 1 Table of Contents "warrants" are to our public warrants and private placement warrants. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any forfeiture of shares, and all references to forfeiture of shares, described in this prospectus shall take effect as a surrender of shares for no consideration as a matter of Cayman Islands law. Any share dividend described in this prospectus will take effect as a share capitalization as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. General Overview of Our Company We are a blank check company newly incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business combination. Our only activities since inception have been organizational activities and those necessary to prepare for this offering. We have not selected any business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. Our team has a history of executing transactions in multiple geographies and under varying economic and financial market conditions. Although we may pursue an acquisition in a number of industries or geographies, we intend to capitalize on the broader Patria Investments Limited, or Patria, platform where we believe a combination of our relationships, knowledge and experience across industries and geographies can effect a positive transformation of an existing business. Our sponsor is an affiliate of Patria, a leading global alternative asset manager. Given Patria s investment capabilities and the expectation that our company will leverage on Patria s capabilities, we believe our team has the required investment, operational, due diligence and capital raising resources to affect a business combination with an attractive target and to position it for long-term success in the public markets. While we may pursue an initial business combination target in any industry or sector, geography, or stage, we intend to focus our search in Latin America and in sectors where Patria has developed investment expertise (including but not limited to healthcare, food and beverage, logistics, agribusiness, education, and financial services). We will pursue an initial business combination with an established business with scale, attractive growth prospects, high-quality shareholders and management, and sustainable competitive advantages. We believe there is a large number of attractive businesses that would benefit from a public listing as well as from the operational and value creation expertise we bring. About Our Sponsor Our sponsor, Patria SPAC LLC, is an affiliate of Patria. We believe Patria offers a compelling value proposition and can help us with value creation for our target business, our shareholders and our Sponsor. Patria is one of the leading private markets investment firms in Latin America in terms of capital raised, with over $8.7 billion raised since 2015 including co-investments. Preqin s 2020 Global Private Equity & Venture Capital Report ranks Patria as the number one fund manager by total capital raised for private equity funds in the past ten years in Latin America. As of December 31, 2021, Patria s assets under management, or AUM, was $14.9 billion with 19 active funds, and Patria s investment portfolio was composed of over 55 companies and assets. Patria s size and performance over its 32-year history also make it one of the most significant emerging markets-based private markets investments managers. We intend to leverage this unique proprietary investment framework and investment expertise with an established operational track record to generate value in our target business through many operational levers, such as revenue growth via cross-selling with other portfolio companies, margin expansion and premiums from green-field projects, relying on Patria s expertise to complement the business development competences of our management. Patria s track record derived from its strategy and capabilities has attracted a committed and diversified base of investors, with over 300 Limited Partners, or LPs, across four continents, including six of the world s 10 largest sovereign wealth fund and 10 of the world s 20 largest pensions, insurance companies, funds of funds, financial 2 Table of Contents institutions, endowments, foundations, and family offices. Approximately 59% of its current LPs have been investing with Patria for over 10 years. Patria s team has also benefited from the investment of its partner, The Blackstone Group Inc., one of the world s leading investment firms, which has held a non-controlling interest in Patria since 2010. On January 26, 2021, Patria announced the closing of its initial public offering of 34,613,647 of its Class A common shares at a public offering price of $17.00 per share. The shares began trading on the Nasdaq Global Select Market on January 22, 2021, under the symbol "PAX." On December 1, 2021 Patria announced the closing of its combination with Moneda Asset Management, or "Moneda," a leading asset manager headquartered in Chile. The transaction creates a combined asset manager with nearly $24 billion in assets under management, which Patria expects will help solidify its private equity, infrastructure and credit platforms in Latin America. The combination enhanced Patria s product offering by adding the largest credit investment platform in Latin America, where Moneda manages nearly $5 billion and has generated market-leading performance. Moneda also manages more than $450 million in private credit investments, adding to more than $200 million managed by Patria, which Patria expects to be the foundation to pursue private credit product development in the region. Moneda also added a public equities portfolio, and including Patria s Constructivist Equity Fund, or CEF, totaled $2.5 billion in public equities AUM. Within this portfolio, the combination created the largest Constructivist Equity/CEF manager in the region with approximately $800 million in assets under management, combining localized expertise in both Brazil and Chile. Complementary investor bases totaling more than 400 institutional clients present a significant cross selling opportunity for Moneda s products, which will continue to carry the Moneda brand, offering Patria s global institutional investors access to yield-oriented products in the region. Patria s investment approach seeks to take advantage of sizable opportunities in Latin America while mitigating risks such as macroeconomic and foreign exchange volatility. Patria does so by focusing on resilient sectors—largely uncorrelated with macroeconomic factors—driving operational value creation and partnering with entrepreneurs and management teams to develop some of the leading platforms in the region. Patria s strategy, applied since 1994 in its flagship private equity products, has generated solid returns and sustained growth. The consolidated equal-weighted net internal rate of return, or IRR, in U.S. dollars for all of Patria s flagship private equity funds since inception was 29.6% as of December 31, 2021 (31.1% in Brazilian reais). The consolidated pooled-weighted net internal rate of return, or IRR, in U.S. dollars for all of Patria s flagship private equity funds since inception was 15.0% as of December 31, 2021 (21.5% in Brazilian reais). Patria has overseen the deployment of more than $20.0 billion through capital raised by its products, capital raised in IPOs and follow-ons, debt raised by underlying companies and capital expenditures sourced from operational cash flow of underlying companies, with more than 90 investments and approximately 300 underlying acquisitions as of December 31, 2021. We believe that Patria s historical returns in U.S. dollars are particularly notable in view of the levels of currency volatility and historically limited use of leverage, which, we also believe, makes Patria better investors focused on value creation, strategy execution and operational excellence, with more limited reliance upon financial engineering. We expect to rely on Patria s expertise and track record to help our management to source an attractive target business and build on Patria s extensive public company expertise to take advantage of value creation opportunities by improving the target business s operations and accelerate its growth. As of December 31, 2021, Patria had 174 professionals, of which 44 were partners and directors, 19 of these working together for more than ten years, operating in ten offices around the globe, including investment offices in Montevideo (Uruguay), S o Paulo (Brazil), Bogot (Colombia), and Santiago (Chile), as well as client-coverage offices in New York (United States), London (United Kingdom), Dubai (UAE), and Hong Kong (China), in addition to Patria s corporate business and management office in George Town (Cayman Islands). 3 Table of Contents Latin American Investment Opportunity Patria has cultivated deep operating & investing acumen and specialized market knowledge in Latin America, a growing and underpenetrated market that we believe provides a sizeable investment opportunity. We believe our affiliation with Patria allows us to be uniquely positioned to capitalize on a number of favorable trends specific to our region, including: Unique regional fundamentals provides solid drivers for growth and stability: positive economic and currency cycles and a low correlation between the Latin American economy and global economy have driven increased demand for exposure in the region among global investors: Scale and growth potential: According to the World Bank, Latin America and the Caribbean s combined GDP of $4.7 trillion represented 9.0% of the Organization for Economic Co-operation and Development, or OECD s, combined GDP in 2020. The region s GDP per capita totaled $7,244.7 in 2020, which represented 19% of OECD s in the same period. Latin America and the Caribbean is also expected to grow at a strong rate, with the International Monetary Fund forecasting 3.0% GDP growth in 2022, highlighting not only the region s vast scale but also potential to be a beneficiary of improvements in macroeconomic and sectorial fundamentals in a fast-growing economy; Macroeconomic effects drive region-wide growth: Consistently improving macroeconomic fundamentals have been sustainable drivers of the regions growth, with: (i) unemployment rates averaging 7.5% on the ten-year period ending December 31,2020, according to the World Bank; (ii) consistent increase in GDP per capita despite the foreign exchange devaluation in recent years, indicating a solid growth trend in relative income levels; (iii) inflation rates remained stable at approximately 3.0% per year on the ten-year period ending December 31, 2020, according to the World Bank; and (iv) continued improvement of educational levels; Solid structural developments: On top of the positive macroeconomic tailwinds, Latin America has also benefitted from accelerating development, including: (i) logistics and network infrastructure expansion; (ii) increase in healthcare infrastructure, labor force and health plans coverage ratio; (iii) development of financial services coverage and credit penetration; (iv) development of energy generation infrastructure; (v) development of regional-wide educational platforms and educational coverage; and (vi) development of retail participation in Capital Markets, among other several potential sector developments; and Brazil is at the center of the Latin American economy: Particularly, Brazil represented 30.8% of Latin American and the Caribbean combined economy in 2020, with a GDP of $1.4 trillion in 2020, according to the World Bank. Brazil is the largest (8.5 million square kilometers) and most populous (over 210 million inhabitants) country in Latin America. It covers an area greater than the continental United States (demanding continental logistics infrastructure investments) and almost as many people as Germany, France and United Kingdom combined (providing a massive consumer base and labor force for a service-oriented economy, of which 63% of GDP comes from services, according to the Brazilian Institute of Geography and Statistics (Instituto Brasileiro de Geografia e Estat stica), or the IBGE. Positive tailwinds for equity investment: Several constantly improving fundamentals have driven the capital markets expansion over the past few years in in Latin America, particularly Brazil, promoting long-standing positive changes in market dynamics for the coming years. Low interest rates: In Brazil, interest rates had reached 2.00% in August 2020, according to the Brazilian Central Bank. The declining trend between 2017 and mid-2021, from double-digit rates to single digits, which to varying degrees occurred in other markets in the region, greatly accelerated the regional transformation of domestic capital markets; and 4 Table of Contents Private markets asset base growth in Brazil: According to the Brazilian Association of Financial and Capital Markets Entities (Associa o Brasileira das Entidades dos Mercados Financeiro e de Capitais), or ANBIMA, the total private markets asset base in Brazil experienced a compound annual growth rate close to 21% from 2010 to 2020, reaching an all-time-high of R$703 billion (approximately $135 billion) in 2020, making private markets one of the fastest-growing asset classes within the asset management industry in the country. Growing opportunity in the rest of the region: Latin America overall has experienced strong growth in private equity funding and venture capital investment (supportive data to come) signaling increasing appetite for capital from growing companies in the region. Attractive sectors are underrepresented in the public markets: Patria invests in a number of sectors throughout Latin America that, while contributing a large portion to GDP in the region, are relatively underrepresented in the Latin American public markets. We believe that this makes a U.S. listing via a special purpose acquisition company particularly attractive to potential partners in Latin America, due to the dearth of similar companies listed on local exchanges; and Exchange rate devaluation promoting substantial attractiveness for foreign investors: Recent exchange rate devaluation in the region allows for a significant increase in foreign investors firepower with dollarized funds, enabling sizeable opportunities with attractive return rates to fit investors check sizes and reduce the need to find co-investors. Particularly in Brazil, where market forecasts point to an increase in interest rates over the next four years, the Brazilian real could potentially face a revaluation process that drives a normalization of these impacts, which would further strengthen the potential opportunity for foreign investment. Our Business Strategy and Competitive Advantage We believe that we, as a Patria special purpose acquisition company, offer a highly compelling, attractive proposition when compared with other blank check companies and other sources of equity capital. We bring a singular geographic focus, unique proprietary investment framework, and investment expertise with a deep operational track record. In addition to the partnership-oriented reputation and region-wide network, which we believe, when taken together with our sponsor and Patria, give us a sustained competitive advantage in sourcing and consummating one or more business combinations, we expect to rely on this collective public company expertise to help guide our partners through their journey as they transition to the public markets. Systematic value-add approach through operational improvement: Patria believes that nearly 60% of value added to their private equity investments generally comes from direct operational improvements, such as revenue growth and margin expansion. Consistent with Patria s strategy, we will seek to partner with companies at attractive valuations by offering a compelling value proposition and partnership opportunity to owner-operators. Patria has developed a proprietary systematic process that couples an associative approach to partnership and a hands-on operational approach, which at times includes the secondment of Patria executives to portfolio companies. These experienced executives support the existing management team in strategic initiatives, consolidation plays, margin improvement exercises, and active board-level participation, with these initiatives expected to be agreed upon prior to the investment and therefore established as part of the investment thesis itself. These initiatives are formalized in written plans that serve as guidelines for future execution initiatives; Proprietary sourcing model: We believe Patria s sourcing capabilities can be a key competitive advantage in our search for an attractive target business. Approximately 90% of all investments pursued by Patria private equity since 1994 have been originated through its proprietary sourcing initiatives. This is driven by Patria s methodical approach to investment sourcing. Portfolio managers, each specialist in their respective industries, utilizing their professional networks and knowledge of the local market and sector to identify potential targets. The portfolio managers then work together with designated business developers and Patria s transactions team to source the transaction. This process is supported by Patria s strong reputation 5 Table of Contents as a valuable partner and a prudent hands-on investor that catalyzes consolidation processes and helps owner-operators develop and grow their companies to become market leaders; Deep public company expertise: Patria has a long track record of expertise in the public markets, including initial public offerings of its portfolio companies as well as its own firm. Patria also has deep expertise in public market investing. In 2015, Patria founded the Constructivist Equity Fund, or CEF, to take advantage of value creation opportunities in publicly listed companies in Brazil. The fund applies Patria s operationally-focused private equity strategy to minority public investments, as compared to the majority control investments that are the mandate of its flagship private equity funds. In this fund, Patria partners with public companies and their management teams to improve their platforms and accelerate growth. As of December 31, 2021, the CEF had a net compounded annualized return of 22.9% in Brazilian reais. We believe Patria s track record of successful partnership and value creation in minority public company investments is highly relevant to our value proposition to a potential partner: Sustained strong investment performance track record across market cycles: Patria has produced strong long-term investment performance, generating consistent outperformance relative to benchmarks. As of December 31, 2021, considering mid-range returns, Patria s funds achieved home run ratio (defined as companies with market value at or above 2x multiple on invested capital, or MOIC) of approximately 58.1% and 71.2% of the total equity value of the companies held by such funds, in U.S. dollars and Brazilian reais, respectively, since inception for Patria s private equity products. Based on the same assumptions, our funds had a loss ratio (defined as companies with market value below 1x MOIC) of only 7.2% and 3.8% in U.S. dollars and Brazilian reais, respectively; and Seasoned management team with entrepreneurial spirit and professional culture: As of December 31, 2021, Patria had a senior management team comprised of 44 members, who averaged 20 years of investment experience, and most of Patria s partners have been working together for more than 15 years. More than half of Patria s partners and officers have portfolio company executive experience, which support the flywheel of operational improvement and the associative partnership approach towards owner-operators. Patria s operating partners, usually former C-level executives from the sectors in which we expect to invest, as well as their value creation team staffed by senior functional specialists, and the transactions group of M&A specialists complement the business development competences of the investment team. As a result, we believe Patria offers a compelling value proposition and can help us with value creation for our target business, our shareholders and our Sponsor. Our Investment Process Consistent with Patria s strategy, our investment process is rooted in a systematic and replicable "investment technology" that Patria uses across all investments. Patria s performance is a result of this rigorous approach, and gives us confidence to be able to identify and consummate a business combination. Sector specialization in resilient industries: We plan to focus on Patria s core sectors, including healthcare, food and beverage, logistics, agribusiness, education and financial services, which are resilient and have significantly and consistently outperformed Brazilian real GDP and other sectors; Systematic framework: We intend to rely on Patria s scalable process to source, diligence, manage investments, supported by nearly 30 modular investment teams and analytical tools; Value creation through operational leverage: Nearly 60% of value generated directly by Patria through operational levers, and more than half of Patria s partners and officers have portfolio company executive experience; Compounding through consolidation: Patria s thesis formulation process is focused on sectors that are historically large, growing, and resilient, where supply-side fragmentation would allow for market consolidations; and 6 Table of Contents Associative partnership approach: We intend to leverage the long-term relationships in the ecosystems in which Patria invests and with strategic players, founders and key industry executives, which resulted in a great majority of deals being sourced independently and outside of open bidding. Acquisition Criteria Consistent with Patria s strategy, we have identified the following general criteria, and plan to target businesses with these five core attributes: Differentiated and sustainable business model, with defensible competitive advantages, and a strong management team; Attractive growth prospects, with the potential to capitalize on secular and regional tailwinds; Sufficient scale and resources to achieve a successful transition to the public markets; High-quality founders, shareholders, executive teams, culturally fit for a constructive and collaborative value creation project; and Businesses that would benefit from having a public currency to enhance its ability to grow organically or through M&A. We are not prohibited from pursuing an initial business combination with a company that is affiliated with Patria, our sponsor, or our officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with Patria, our sponsor, or officers or directors, such transaction would be subject to approval by a majority of our independent and disinterested directors. We would not be required to obtain an opinion from a third party firm in such event to address whether the business combination is fair to our public shareholders from a financial point of view. Our directors and officers may directly or indirectly own our ordinary shares or private placement warrants following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors is included by a target business as a condition to any agreement with respect to our initial business combination. Our Management Team Our management team will consist of Ricardo Leonel Scavazza, our Chairman and Director, Alexandre Teixeira de Assump o Saigh, our Director, Jos Augusto Gon alves de Ara jo Teixeira, our CEO, and Marco Nicola D Ippolito, our Chief Financial Officer. They will be supported by Patria s sector and functional specialists, particularly those belonging to our advisory committee and our independent directors, as further described below. Ricardo Leonel Scavazza, Chairman and Director Ricardo Leonel Scavazza is the Chairman of our board of directors. Mr. Scavazza is a Managing Partner of Patria Investments Limited and is the Chief Executive Officer & Chief Investments Officer of Latin American Private Equity. Mr. Scavazza is responsible for all Latam Private Equity strategy at Patria Investments Limited. Before taking over as CEO & CIO for Private Equity Latam, Mr. Scavazza served as the Head of Private Equity Strategy in Brazil. Mr. Scavazza joined Patrim nio in 1999, became a Partner in 2005, and has worked on several new investments and acquisitions for the portfolio companies of Private Equity Funds I, II, III, IV and V. Mr. Scavazza held operating roles in several investments, including a tenure as Chief Executive Officer at Anhanguera between 2009 and 2013. He was Chief Financial Officer at DASA in 2001 and at Anhanguera Educacional from 2003 to 2006. Mr. Scavazza holds a bachelor s degree in Business Administration and Management from Funda o Getulio Vargas (FGV) and the University of Texas at Austin. Mr. Scavazza also holds 7 Table of Contents an Master s in Business Administration and Management from the Kellogg School of Management at Northwestern University. Alexandre Teixeira de Assump o Saigh, Director Alexandre Teixeira de Assump o Saigh has served as our Director of the Board since our inception. Mr. Saigh is the Chief Executive Officer and is a member of the Board of Directors at Patria Investments Limited since 2010. He is also one of our founding partners and Chairman of our executive-level Private Equity Investment and Divestment Committee. Mr. Saigh is also a Senior Managing Partner of Patria Investments Limited and an Executive Director of Patria Holdings Limited. Before taking the role as Chief Executive Officer, Mr. Saigh was primarily responsible for our Private Equity division being responsible for the start-up and development of this business within Patria. He held and currently holds board member positions in several of our funds invested companies. Mr. Saigh was one of the founders of Patria in 2001 (successor of Banco Patrim nio), developing and leading the efforts for Patria to become one of the leading private markets firms in Latin America. Mr. Saigh joined Banco Patrim nio in 1994, as a Managing Partner responsible for the development and execution of Patria Investments Limited s private equity business. Between 1994 and 1997, while developing Patrim nio s private equity strategy, Mr. Saigh was Chief Executive Officer and Chief Financial Officer of Drogasil, one of the leading drugstore chains in Brazil and Patria s first private equity investment. Prior to joining Patrim nio, Mr. Saigh worked at J.P. Morgan Investment Bank from 1989 to 1994, as a Vice President for its private equity, corporate finance and M&A divisions. Mr. Saigh holds a bachelor s degree in Financial Management and Hotel Administration from Boston University and a Post- Graduate Certificate of Special Studies in Administration and Management from Harvard University. Jos Augusto Gon alves de Ara jo Teixeira, Chief Executive Officer Jos Augusto Gon alves de Ara jo Teixeira is our Chief Executive Officer. Mr. Teixeira is a Partner of Patria Investments Limited, where he currently serves as a member of its Management Committee and as Head of Marketing and Products. Mr. Teixeira is primarily responsible for Patria s Global Product & Marketing strategy and development as well as for leading distribution efforts in Brazil. Previously, Mr. Teixeira served as the Head of Marketing and Investor Relations for Private Equity products between 2013 and 2020. From 2005 to 2013, Mr. Teixeira was fully dedicated to Anhanguera Educacional, Patria s flagship investment in Education, where he held various senior positions: he served as Chief Financial Officer between 2011 and 2013, including oversight over the company s robust M&A program; Investor Relations Officer between 2007 and 2013; Strategic, Commercial and Financial Planning Director between 2007 and 2011; and Financial Planning Manager between 2005 and 2007. Prior to the investment in Anhanguera, Mr. Teixeira focused on the development of Patria Investments Limited s post-secondary Education thesis and worked at Anhembi-Morumbi University. Prior to joining Patria in 2004, Mr. Teixeira worked with the Latin American Research Sales team at Goldman Sachs in New York. Mr. Teixeira holds a bachelor s degree in Political Science and Economics from Amherst College. Marco Nicola D Ippolito, Chief Financial Officer Marco Nicola D Ippolito has served as our Chief Financial Officer since our inception. Mr. D Ippolito is also Managing Partner & Chief Financial Officer of Patria Investments Limited. Mr. D Ippolito is a member of Patria Investments Limited s Management Committee and is primarily responsible for finance, operations, shareholders relations, fund administration, legal, compliance, technology and governance. Before taking over as CFO, Mr. D Ippolito served Patria Investments Limited as COO for four years. Before that, Mr. D Ippolito worked at Patria Investment Limited s Private Equity division, being responsible for different investments in the technology, logistics, healthcare, agribusiness and food industries. Mr. D Ippolito was also responsible for fundraising initiatives within the Patria Private Equity business. In addition, Mr. D Ippolito was the Chairman of the Board and Board Member of different portfolio companies. Before joining Patria in 2005, Mr. D Ippolito worked for a Latin American family office as private equity portfolio manager between 2002 and 2005. Prior to that, Mr. D Ippolito participated on the start-up, development and sale of an IT private company in Brazil. Mr. D Ippolito holds a bachelor s degree in Economics from Funda o Armando lvares Penteado (FAAP) and an MBA from Instituto Brasileiro de Mercado de Capitais (IBMEC). 8 Table of Contents Our Independent Director Nominees Our independent director nominees will join our board of directors upon the effective date of the registration statement of which this prospectus forms a part. We believe our board members will add significant value to our target company and will aid in our ability to source our initial business combination. These nominees are: Pedro Paulo Elejalde de Campos, Director Nominee Pedro Paulo Elejalde de Campos will serve as a Director upon the completion of this offering. Mr. Campos is currently a Managing Partner at Arsenal Investimentos, a Brazilian based investment and advisory firm. Mr. Campos joined Arsenal in 2017 and is responsible for leading its investment banking activities. Prior to that, from 2011 to 2017, Mr. Campos was a Partner at Patria Investimentos, a Brazilian investment firm associated with Blackstone Group from New York, where he was responsible for Blackstone s investments in Brazil and Patria Investment Limited s investment banking operations. From 2003 to 2011, Mr. Campos was at Angra Partners, an investment and financial advisory firm, where he was a Founding Managing Partner responsible for its general management, investment committees (chair) and investment portfolios. In addition, during his career, Mr. Campos held the position of a Managing Director at Citigroup from 2000 to 2003, the President and CEO of GE Capital Latin America and Banco GE Capital Brasil from 1996 to 2000. Mr. Campos started his professional career in 1982 at J.P. Morgan offices in New York and left the firm in 1995 as a Vice President. Also, along his career, Mr. Campos has served as board director in several corporations and non-profit organizations. Mr. Campos holds bachelors degrees in Engineering and Business Administration; both from Universidade Federal do Rio Grande Sul. Ricardo Barbosa Leonardos, Director Nominee Ricardo Barbosa Leonardos will serve as a Director upon the completion of this offering. Currently, Mr. Leonardos is a founding partner of Symphony (since 2002), a family business consulting firm focused on governance, succession, financial planning and family office. In this role, Mr. Leonardos structured and was the CEO of the Diniz family office for five years. Additionally, Mr. Leonardos is the vice-chairman of the Tecnisa S.A. s board of directors (since 2006), an independent board member of Biosev S.A./Louis Dreyfuss Group (since 2013), a member of the board of directors of Associa o Umane (since 2016), an independent member of the board of ASG Holdings/Athena Sa de (since 2020) and serves on the advisory board of the family holding companies Componente (since 2010) and Jaguari (since 2019). With over 30 years of experience in the capital markets and investments, Mr. Leonardos has worked in mergers and acquisitions, IPOs, privatization processes, portfolio management and investment funds. Mr. Leonardos is certified as an advisor by the IBGC-Brazilian Institute of Corporate Governance, as a consultant for family businesses by the Family Firm Institute of Boston, as portfolio manager authorized by the Securities and Exchange Commission and as an analyst by APIMEC. Mr. Leonardos holds a bachelor s degree in Economics from the Faculdade de Economica S o Luis and an MBA from the Leonard N. Stern School of Business at New York University. He also holds a certificate in Technology Innovation in Planning Effective Investments in Technology Markets from Tel-Aviv University – Coller School of Management Business Leaders and in the Digital Immersion Program from Digital House of S o Paulo. Maria Cl udia Mello Guimar es, Director Nominee Maria Cl udia Mello Guimar es will serve as a Director upon the completion of this offering. She is a partner at KPC Consulting Firm, a member of Petrobras Board of Directors, a member of Petrobras Audit Committee and president of Petrobras Environment, Safety and Health Committee. A former board member of Constellation Oil Services in Luxembourg, Ms. Guimar es also worked as Investment Banking Manager Director at Bank of America Merrill Lynch for almost 10 years. Before that, Ms. Guimar es had experiences at ING, Ita Bank, Bank Boston and ABN AMRO working in several areas, such as investment banking, corporate finance, corporate banking, credit risk, debt restructuring and project finance, mainly focused on Natural Resources, Energy and Capital Goods companies. Additionally, Ms. Guimar es holds a bachelor s degree in Engineering from Universidade Federal do Rio de Janeiro (UFRJ) with a master s degree from COPPEAD - UFRJ. 9 Table of Contents Initial Business Combination The Nasdaq rules require that our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the net assets held in the trust account (excluding the amount of deferred underwriting commissions held in the trust account and taxes payable on the income earned on the trust account) at the time of signing the agreement to enter into the initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination upon standards generally accepted by the financial community. If our board of directors is not able to independently determine the fair market value of the target business or businesses, or if we are considering an initial business combination with an affiliated entity, such transaction would be subject to approval by a majority of our independent and disinterested directors. We would not be required to obtain an opinion from a third party firm in such event to address whether the business combination is fair to our public shareholders from a financial point of view. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. We also will not be permitted to effectuate our initial business combination with another blank check company or a similar company with nominal operations. Subject to these limitations, our directors and executive officers will have virtually unlimited flexibility in identifying and selecting one or more prospective businesses. We may, at our option, pursue an acquisition opportunity jointly with Patria, or one or more parties affiliated with Patria, including without limitation officers and affiliates of Patria, funds associated with Patria or investors in such funds. Any such party may co-invest with us in the target business at the time of our initial business combination, or we could raise additional proceeds to complete the acquisition by borrowing from or issuing to such parties a class of equity or debt securities. The amount and other terms and conditions of any such joint acquisition or specified future issuance would be determined at the time thereof. We anticipate structuring our initial business combination so that the post-business combination company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-business combination company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the prior owners of the target business, the target management team or shareholders or for other reasons. We will only complete such business combination if the post-business combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-business combination company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-business combination company, depending on the relative valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target or issue a substantial number of new shares to third parties in connection with financing our initial business combination. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-business combination company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking shareholder approval, as applicable. The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the funds we can use to complete another business combination. 10 Table of Contents Other Considerations We currently do not have any specific business combination under consideration. Patria and our directors and officers are regularly made aware of potential business combination opportunities, one or more of which we may desire to pursue. However, we have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. In addition, certain of our directors and officers currently have, and any of them in the future may have additional, fiduciary and contractual duties to other entities, including without limitation Patria and funds associated with Patria or their current or former portfolio companies. These funds may have overlapping investment objectives and potential conflicts may arise with respect to Patria s decision regarding how to allocate investment opportunities among these funds. If any of our directors and officers becomes aware of a business combination opportunity that is suitable for a fund or entity to which he or she has then-current fiduciary or contractual obligations (including, without limitation, any funds associated with Patria or their current or former portfolio companies), then, subject to their fiduciary duties under Cayman Islands law, he or she will need to honor such fiduciary or contractual obligations to present such business combination opportunity to such fund or entity, before we can pursue such opportunity. If Patria, funds associated with Patria or other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. In addition, investment ideas generated within or presented to Patria or our directors and executive officers may be suitable for both us and Patria, a current or future Patria fund or one or more of their portfolio companies and, subject to applicable fiduciary duties or contractual obligations, will first be directed to Patria, such fund, investment vehicle or portfolio company before being directed, if at all, to us. However, we do not expect these fiduciary duties or contractual obligations to materially affect our ability to identify and pursue business combination opportunities or to complete our initial business combination. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity (including with respect to any business transaction that may involve another Patria entity) for any director or officer, on the one hand, and us, on the other. Accordingly, Patria and our directors or officers may not be obliged to present a business combination opportunity to us. Our directors and officers or Patria or their affiliates, including funds associated with Patria, may sponsor, form or participate in other blank check companies similar to ours during the period in which we are seeking an initial business combination. Any such companies may present additional conflicts of interest in pursuing an acquisition target, particularly in the event there is overlap among investment mandates and the director and officer teams. However, we do not currently expect that any such other blank check company would materially affect our ability to identify and pursue business combination opportunities or to complete our initial business combination. In addition, our officers and directors are not required to commit any specified amount of time to our affairs, and, accordingly, will have conflicts of interest in allocating time among various business activities, including identifying potential business combinations and monitoring the related due diligence. Moreover, our officers and directors, including our chief executive officer, are and in the future will be required to commit time and attention to Patria and current and future funds associated with Patria. To the extent any conflict of interest arises between, on the one hand, us and, on the other hand, any of such entities (including, without limitation, arising as a result of certain of officers and directors being required to offer acquisition opportunities to such entities), Patria and its affiliated funds will resolve such conflicts of interest in their sole discretion in accordance with their then existing fiduciary, contractual and other duties and there can be no assurance that such conflict of interest will be resolved in our favor. Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a result, we are subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. 11 Table of Contents Corporate Information Our executive offices are located at 18 Forum Lane, 3rd floor, Camana Bay, PO Box 757, KY1-9006, Grand Cayman, Cayman Islands and our telephone number is +1 345-640-4900. Our website and the information contained on, or that can be accessed through, the website is not deemed to be incorporated by reference in, and is not considered part of, this prospectus or the registration statement of which this prospectus is a part. We are a Cayman Islands exempted company. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have received a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are an "emerging growth company," as defined in Section 2(a) of the Securities Act of 1933, as amended (the "Securities Act"), as modified by the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an "emerging growth company" can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that are held by non-affiliates equals or exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to "emerging growth company" will have the meaning associated with it in the JOBS Act. Additionally, we are a "smaller reporting company" as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of any fiscal year for so long as either (1) the market value of our ordinary shares held by non-affiliates did not equal or exceed $250 million as of the prior June 30, or (2) our annual revenues did not equal or exceed $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates did not equal or exceed $700 million as of the prior June 30. 12 Table of Contents The Offering In making your decision on whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled "Risk Factors". Securities offered: 20,000,000 units (or 23,000,000 units if the underwriters over-allotment option is exercised in full), at $10.00 per unit, each unit consisting of: one Class A ordinary share; and one-half of one redeemable warrant. Nasdaq symbols: Units: "PLAOU" Class A Ordinary Shares: "PLAO" Warrants: "PLAOW" Trading commencement and separation of Class A ordinary shares and warrants: The units are expected to begin trading on or promptly after the date of this prospectus. The Class A ordinary shares and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus (or the immediately following business day if such 52nd day is not a business day) unless J.P. Morgan Securities LLC and Citigroup Global Markets Inc., the representatives of the underwriters, informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the Class A ordinary shares and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into Class A ordinary shares and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least three units, you will not be able to receive or trade a whole warrant. Additionally, the units will automatically separate into their component parts and will not be traded after completion of our initial business combination. Separate trading of the Class A ordinary shares and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A ordinary shares and warrants be traded separately until we have filed with 13 Table of Contents the SEC a Current Report on Form 8-K which includes an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which closing is anticipated to take place three business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. Units: Number outstanding before this offering 0 Number outstanding after this offering 20,000,000(1) Ordinary shares: Number outstanding before this offering 5,750,000(2) Number outstanding after this offering 25,000,000(1)(3) Warrants: Number of private placement warrants to be sold in a private placement simultaneously with this offering 13,000,000(1) Number of warrants to be outstanding after this offering and the private placement 23,000,000(1)(4) (1) Assumes no exercise of the underwriters over-allotment option and the surrender of 750,000 founder shares to us for no consideration. (2) Includes up to 750,000 founder shares that may be surrendered to us for no consideration depending on the extent to which the underwriters over-allotment option is exercised. (3) Comprised of 20,000,000 Class A ordinary shares included in the units to be sold in this offering and 5,750,000 Class B ordinary shares (or founder shares). Founder shares are currently classified as Class B ordinary shares, which shares may be converted into Class A ordinary shares concurrently with or immediately following the consummation of our initial business combination on a one-for-one basis, subject to adjustment as described below adjacent to the caption "Founder shares conversion and anti-dilution rights." (4) Comprised of 10,000,000 public warrants included in the units to be sold in this offering and 13,000,000 private placement warrants to be sold in the private placement. Exercisability Each whole warrant offered in this offering is exercisable to purchase one Class A ordinary share. Only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We structured each unit to contain one-half of one warrant, with each whole warrant exercisable for one Class A ordinary share, as compared to units issued by certain other blank check companies which contain 14 Table of Contents whole warrants exercisable for one whole share, in order to reduce the dilutive effect of the warrants upon completion of a business combination, thus making us, we believe, a more attractive business combination partner for target businesses. Exercise price $11.50 per share, subject to adjustments as described herein. In addition, if (x) we issue additional Class A ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per Class A ordinary share (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our initial shareholders or their affiliates, without taking into account any founder shares held by our initial shareholders or such affiliates, as applicable, prior to such issuance) (the "Newly Issued Price"), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our Class A ordinary shares during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the "Market Value") is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, the $18.00 per share redemption trigger price described adjacent to "Redemption of warrants when the price per share of Class A ordinary shares equals or exceeds $18.00" will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price, and the $10.00 per share redemption trigger price described adjacent to the caption "Redemption of warrants when the price per share of Class A ordinary shares equals or exceeds $10.00" will be adjusted (to the nearest cent) to be equal to the higher of the Market Value and the Newly Issued Price. Exercise period The warrants will become exercisable on the later of: 30 days after the completion of our initial business combination, and 12 months from the closing of this offering; provided, in each case, that we have an effective registration statement under the Securities Act covering the Class A ordinary shares issuable upon exercise of the warrants and a current prospectus 15 Table of Contents relating to them is available and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. We are not registering the Class A ordinary shares issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable, but in no event later than 15 business days after the closing of our initial business combination, we will use our commercially reasonable efforts to file with the SEC and have an effective registration statement covering the Class A ordinary shares issuable upon exercise of the warrants and to maintain a current prospectus relating to those Class A ordinary shares until the warrants expire or are redeemed, as specified in the warrant agreement. If a registration statement covering the Class A ordinary shares issuable upon exercise of the warrants is not effective by the 60th business day after the closing of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a "cashless basis" in accordance with Section 3(a)(9) of the Securities Act or another exemption. Notwithstanding the above, if our Class A ordinary shares are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a "covered security" under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a "cashless basis" in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, and in the event we do not so elect, we will use our commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. 16 Table of Contents Redemption of warrants for cash when the price per Class A ordinary share equals or exceeds $18.00 Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the private placement warrants): in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period; and if, and only if, the closing price of our Class A ordinary shares equals or exceeds $18.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders (the "Reference Value"). We will not redeem the warrants unless an effective registration statement under the Securities Act covering the Class A ordinary shares issuable upon exercise of the warrants is effective and a current prospectus relating to those Class A ordinary shares is available throughout the 30-day redemption period. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. As a result, we may redeem the warrants as set forth above even if the holders are otherwise unable to exercise the warrants. Any such exercise would not be on a "cashless" basis and would require the existing warrant holder to pay the exercise price for each warrant being exercised. Redemption of warrants for cash when the price per Class A ordinary share equals or exceeds $10.00 Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the private placement warrants): in whole and not in part; at $0.10 per warrant upon a minimum of 30 days prior written notice of redemption, provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive the number of shares determined by reference to the 17 Table of Contents table set forth under "Description of Securities – Warrants – Public Shareholders Warrants" based on the redemption date and the "fair market value" of our Class A ordinary shares (as defined below); if, and only if, the Reference Value (as defined above under "Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00") equals or exceeds $10.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like); and if the Reference Value is less than $18.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like), the private placement warrants must also concurrently be called for redemption on the same terms (except as described herein with respect to a holder s ability to cashless exercise its warrants) as the outstanding public warrants, as described above. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. As a result, we may redeem the warrants as set forth above even if the holders are otherwise unable to exercise the warrants. The "fair market value" of our Class A ordinary shares shall mean the volume-weighted average price of our Class A ordinary shares for the 10 trading days immediately following the date on which the notice of redemption is sent to the holders of warrants. We will provide our warrant holders with the final fair market value no later than one business day after the 10-day trading period described above ends. In no event will the warrants be exercisable in connection with this redemption feature for more than 0.361 Class A ordinary shares per warrant (subject to adjustment). No fractional Class A ordinary shares will be issued upon exercise. If, upon exercise, a holder would be entitled to receive a fractional interest in a share, we will round down to the nearest whole number of the number of Class A ordinary shares to be issued to the holder. Please see the section entitled "Description of Securities—Warrants—Public Shareholders Warrants" for additional information. Founder shares In March 2021, one of our officers paid $25,000, or approximately $0.004 per share, to cover certain of our offering costs, in exchange for an aggregate of 18 Table of Contents 7,187,500 founder shares, which were temporarily issued to such officer until such shares were transferred to our sponsor in April 2021. In February 2022, our sponsor forfeited 1,437,500 founder shares for no consideration, remaining with 5,750,000 founder shares. Prior to this offering, our sponsor also intends to transfer 30,000 of our founder shares to each of our three independent director nominees. These 90,000 shares will not be subject to forfeiture in the event the underwriters over-allotment option is not exercised. Prior to the initial investment in the company of $25,000, the company had no assets, tangible or intangible. The per-share price of the founder shares was determined by dividing the amount of expenses paid on behalf of the company by the number of founder shares issued. The number of founder shares outstanding was determined based on the expectation that the total size of this offering would be a maximum of 23,000,000 units if the underwriters over-allotment option is exercised in full, and therefore that such founder shares would represent 20% of the outstanding shares after this offering. Up to 750,000 of the founder shares may be surrendered by our sponsor for no consideration depending on the extent to which the underwriters over-allotment option is not exercised. The founder shares are designated as Class B ordinary shares and are identical to the Class A ordinary shares included in the units being sold in this offering, except that: only holders of Class B ordinary shares will have the right to appoint directors in any general meeting held prior to or in connection with the completion of our initial business combination; the founder shares are subject to certain transfer restrictions, as described in more detail below; the founder shares are entitled to registration rights; our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to (i) waive their redemption rights with respect to their founder shares and public shares in connection with the completion of our initial business combination; (ii) waive their redemption rights with respect to their founder shares and public shares in connection with a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we have not consummated an initial business combination within 19 Table of Contents 15 months from the closing of this offering (or up to within 21 months if we extend the period of time to consummate our initial business combination in accordance with the terms described in this prospectus) or (B) with respect to any other material provisions relating to shareholders rights or pre-initial business combination activity; (iii) waive their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within 15 months from the closing of this offering (or up to within 21 months if we extend the period of time to consummate our initial business combination in accordance with the terms described in this prospectus), although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame; and (iv) vote any founder shares held by them and any public shares purchased during or after this offering (including in open market and privately-negotiated transactions) in favor of our initial business combination. If we submit our initial business combination to our public shareholders for a vote, we will complete our initial business combination only if we receive an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the company. As a result, in addition to our initial shareholders founder shares, we would need 7,500,001, or 37.5%, of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming all outstanding shares are voted and the over-allotment option is not exercised); and the founder shares may be converted into our Class A ordinary shares concurrently with or immediately following the consummation of our initial business combination on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described below adjacent to the caption "Founder shares conversion and anti-dilution rights." Expression of interest Patria or its affiliates have expressed to us an interest to purchase an aggregate of 2,000,000 units (or 2,300,000 units if the underwriters over-allotment option is exercised in full) in this offering at the public offering price and we have agreed to direct the underwriters to sell to Patria or its affiliates such amount of units. Because this expression of interest is not a binding agreement or commitment to purchase, Patria or its affiliates may determine to purchase more, fewer or no units in this offering or the underwriters may determine to sell more, fewer or no units to Patria or its affiliates. Patria or its affiliates will not purchase materially more than 2,000,000 units (or 2,300,000 units if the underwriters over-allotment option is exercised in full) in this offering. In the event that Patria or its affiliates purchase such units (either in this offering or after) and vote their public shares and founder shares in favor of our initial business combination, a smaller portion of affirmative votes from other public stockholders would be required to approve our initial business combination. Any units purchased by Patria or its affiliates in the offering (and their constituent Class A ordinary shares and warrants) will not be subject to the restrictions on transfer applicable to the founder shares and private placement warrants. As a result of the founder shares, private placement warrants and units that Patria or its affiliates may hold (directly or indirectly), it may have different interests with respect to a vote on an initial business combination than other public shareholders. Transfer restrictions on founder shares Our initial shareholders have agreed not to transfer, assign or sell any of their founder shares and any Class A ordinary shares issuable upon conversion thereof until the earlier to occur of: (i) one year after the completion of our initial business combination or (ii) the date on which we complete a liquidation, merger, share exchange or other similar transaction after our initial business combination that results in all of our 20 Table of Contents shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property; except to certain permitted transferees and under certain circumstances as described herein under "Principal Shareholders—Transfers of Founder Shares and Private Placement Warrants". Any permitted transferees will be subject to the same restrictions and other agreements of our initial shareholders with respect to any founder shares. We refer to such transfer restrictions throughout this prospectus as the lock-up. Notwithstanding the foregoing, if (1) the closing price of our Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination or (2) we consummate a transaction after our initial business combination which results in our shareholders having the right to exchange their shares for cash, securities or other property, the founder shares will be released from the lock-up. Founder shares conversion and anti-dilution rights The founder shares may be converted into Class A ordinary shares concurrently with or immediately following the consummation of our initial business combination on a one-for-one basis, subject to adjustment for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein. In the case that additional Class A ordinary shares or equity-linked securities are issued or deemed issued in connection with our initial business combination, the number of Class A ordinary shares issuable upon conversion of all founder shares will equal, in the aggregate, 20% of the total number of Class A ordinary shares outstanding after such conversion (after giving effect to any redemptions of Class A ordinary shares by public shareholders), including the total number of Class A ordinary shares issued, or deemed issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the company in connection with or in relation to the consummation of the initial business combination, excluding any Class A ordinary shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued, deemed issued or to be issued, to any seller in the initial business combination and any private placement warrants to be issued to our sponsor, officers or directors upon conversion of working capital loans; provided that such conversion of founder 21 Table of Contents shares will never occur on a less than one-for-one basis. Appointment of directors; Voting Holders of record of our Class A ordinary shares and Class B ordinary shares are entitled to one vote for each share held on all matters to be voted on by shareholders. Unless specified in our amended and restated memorandum and articles of association, or as required by the Companies Act or stock exchange rules, an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the company is generally required to approve any matter voted on by our shareholders. Approval of certain actions require a special resolution under Cayman Islands law, which requires the affirmative vote of a majority of at least two-thirds of the shareholders who attend and vote at a general meeting of the company, and pursuant to our amended and restated memorandum and articles of association, such actions include amending our amended and restated memorandum and articles of association and approving a statutory merger or consolidation with another company. There is no cumulative voting with respect to the appointment of directors, meaning, following our initial business combination, the holders of more than 50% of our ordinary shares voting for the appointment of directors can appoint all of the directors. Only holders of Class B ordinary shares will have the right to appoint directors in any general meeting held prior to or in connection with the completion of our initial business combination. Holders of our public shares will not be entitled to vote on the appointment of directors during such time. These provisions of our amended and restated memorandum and articles of association relating to the rights of holders of Class B ordinary shares to appoint directors may be amended by a special resolution passed by a majority of at least 90% of our ordinary shares voting in a general meeting. With respect to any other matter submitted to a vote of our shareholders, including any vote in connection with our initial business combination, except as required by law, holders of the founder shares and holders of our public shares will vote together as a single class, with each share entitling the holder to one vote. If we seek shareholder approval of our initial business combination, we will complete our initial business combination only if we receive an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the company. In such case, our sponsor, officers and directors have agreed to vote their founder shares and any public 22 Table of Contents shares purchased during or after this offering (including in open market and privately-negotiated transactions) in favor of our initial business combination. As a result, in addition to our initial shareholders founder shares, we would need 7,500,001, or 37.5%, of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming all outstanding shares are voted and the over-allotment option is not exercised), not considering the public shares included in any units that may be purchased in this offering by Patria, as described under "—Expression of interest." Private placement warrants Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 13,000,000 private placement warrants (or 14,500,000 warrants if the underwriters over-allotment option is exercised in full), each exercisable to purchase one Class A ordinary share at $11.50 per share, at a price of $1.00 per warrant, or $13,000,000 in the aggregate (or $14,500,000 if the underwriters over-allotment option is exercised in full), in a private placement that will close simultaneously with the closing of this offering. A portion of the purchase price of the private placement warrants will be added to the proceeds from this offering to be held in the trust account such that at the time of closing of this offering $206,000,000 (or $236,900,000 if the underwriters exercise its over-allotment option in full) will be held in the trust account. The private placement warrants will be identical to the warrants sold in this offering except that, so long as they are held by our sponsor or its permitted transferees, the private placement warrants (i) will not be redeemable by us, (ii) may not (including the Class A ordinary shares issuable upon exercise of these warrants), subject to certain limited exceptions, be transferred, assigned or sold by the holders until 30 days after the completion of our initial business combination, (iii) may be exercised by the holders on a cashless basis and (iv) will be entitled to registration rights. If the private placement warrants are held by holders other than our sponsor or its permitted transferees, the private placement warrants will be redeemable by us and exercisable by the holders on the same basis as the warrants included in the units being sold in this offering. If we do not complete our initial business combination within 15 months from the closing of this offering (or up to within 21 months if we extend the period of time to consummate our initial business combination in accordance with the terms described in this prospectus), the private placement warrants will expire worthless. 23 Table of Contents Transfer restrictions on private placement warrants The private placement warrants (including the Class A ordinary shares issuable upon exercise of the private placement warrants) will not be transferable, assignable or salable until 30 days after the completion of our initial business combination, except as described herein under "Principal Shareholders—Transfers of Founder Shares and Private Placement Warrants." Proceeds to be held in trust account Nasdaq rules provide that at least 90% of the gross proceeds from this offering and the sale of the private placement warrants be deposited in a trust account. Of the net proceeds we will receive from this offering and the sale of the private placement warrants described in this prospectus, $206,000,000, or $236,900,000 if the underwriters over-allotment option is exercised in full ($10.30 per unit in either case), will be deposited into a segregated trust account located in the United States at J.P. Morgan Chase Bank, N.A. with Continental Stock Transfer & Trust Company acting as trustee, after deducting $4,000,000 in underwriting discounts and commissions payable upon the closing of this offering (or $4,600,000 if the underwriters over-allotment option is exercised in full) and an aggregate of $3,000,000 to pay fees and expenses in connection with the closing of this offering and for working capital following the closing of this offering. The proceeds to be placed in the trust account include $7,000,000 (or up to $8,050,000 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, if any, the proceeds from this offering and the sale of the private placement warrants will not be released from the trust account until the earliest of (i) the completion of our initial business combination, (ii) the redemption of our public shares if we have not completed our initial business combination within 15 months from the closing of this offering (or up to within 21 months if we extend the period of time to consummate our initial business combination in accordance with the terms described in this prospectus), subject to applicable law, or (iii) the redemption of our public shares properly submitted in connection with a shareholder vote to amend our amended and restated memorandum and articles of association to (A) modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we have not consummated an initial business combination within 15 months from the closing of this offering (or up to within 21 months if 24 Table of Contents we extend the period of time to consummate our initial business combination in accordance with the terms described in this prospectus) or (B) with respect to any other material provisions relating to shareholders rights or pre-initial business combination activity. The funds held in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. Ability to extend time to complete initial business combination We will have until 15 months from the closing of this offering to consummate an initial business combination. However, in our sole discretion, we may, but are not obligated to, extend the period of time to consummate a business combination by two additional three month periods (for a total of up to 21 months to complete a business combination); provided that our sponsor, as defined below (or its designees) must deposit into the trust account funds equal to $0.10 per unit sold in this offering for each three month extension, for an aggregate additional amount of $2,000,000 (or $2,300,000 if the underwriters over-allotment option is exercised in full) for each such extension, in exchange for a non-interest bearing, unsecured promissory note to be repaid by us following our business combination. Such loan may be convertible into warrants, at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants. If we do not complete a business combination, we will repay such loans solely from assets not held in the trust account, if any. Our public shareholders will not be afforded an opportunity to vote on our extension of time to consummate an initial business combination from 15 months up to 21 months described above or redeem their shares in connection with such extension. If we are unable to consummate an initial business combination within such time period, we will, as promptly as reasonably possible but not more than 10 business days thereafter, redeem 100% of the outstanding public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including any interest earned on the funds held in the trust account and net of interest that may be used by us to pay our taxes, and less up to $100,000 of interest to pay dissolution expenses, divided by the number of then outstanding public shares, which redemption will completely extinguish the public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law and as further described herein, and then seek to dissolve and liquidate. We expect the pro rata redemption price to 25 Table of Contents be approximately $10.50 per unit (regardless of whether or not the underwriters exercise their over-allotment option), without taking into account any interest earned on such funds. However, we cannot assure you that we will in fact, be able to distribute such amounts as a result of claims of creditors, which may take priority over the claims of our public shareholders. Our public shareholders will not be afforded an opportunity to vote on our extension of time to consummate an initial business combination from 15 months up to 21 months described above or redeem their shares in connection with such extension. However, our public shareholders will be entitled to vote and/or redeem their shares in connection with a shareholder meeting held to approve an initial business combination or in a tender offer undertaken in connection with such an initial business combination if we propose such a business combination during any six month extension period. Pursuant to the terms of the trust agreement, in order for the time available for us to consummate our initial business combination to be extended, our sponsor or its affiliates or designees, upon five days advance notice prior to the deadline, must deposit into the trust account an aggregate additional amount of $2,000,000 (or $2,300,000 if the underwriters over-allotment option is exercised in full) for each such extension on or prior to the date of the deadline. Any such payments would be made in the form of a non-interest bearing loan which would be due and payable on the consummation of our initial business combination out of the proceeds of the trust account released to us. Such loan may be convertible into warrants, at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants. If we do not complete a business combination, we will repay such loans solely from assets not held in the trust account, if any. In the event that we receive notice from our sponsor five days prior to the deadline of its wish for us to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the deadline. In addition, we intend to issue a press release the day after the deadline announcing whether or not the funds had been timely deposited. Our sponsor and its affiliates or permitted designees are not obligated to extend the time for us to complete our initial business combination. If we complete our initial business combination, we would repay such loaned amounts out of the proceeds of the trust account released to us. 26 Table of Contents Anticipated expenses and funding sources Unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use, except the withdrawal of interest to pay our taxes and/or to redeem our public shares in connection with an amendment to our amended and restated memorandum and articles of association, as described above. The proceeds held in the trust account will be invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. We estimate the interest earned on the trust account will be approximately $206,000 per year, assuming an interest rate of 0.1% per year; however, we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from such interest withdrawn from the trust account and: the net proceeds of this offering and the sale of the private placement warrants not held in the trust account, which initially will be $2,310,000 in working capital after the payment of approximately $690,000 in expenses relating to this offering; and any loans or additional investments from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation to advance funds or invest in us; provided that any such loans will not have any claim on the funds held in the trust account unless such proceeds are released to us upon completion of our initial business combination. Up to $2,000,000 of such loans may be convertible into private placement warrants, at a price of $1.00 per warrant, at the option of the lender. The warrants would be identical to the private placement warrants. There is no limitation on our ability to raise funds through the issuance of equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination. Conditions to completing our initial business combination Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value 27 Table of Contents of our initial business combination upon standards generally accepted by the financial community. If our board of directors is not able to independently determine the fair market value of our initial business combination (including with the assistance of financial advisors), or if we are considering an initial business combination with an affiliated entity, such transaction would be subject to approval by a majority of our independent and disinterested directors. While we consider it likely that our board of directors will be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of the target s assets or prospects. We would not be required to obtain an opinion from a third party firm in such event to address whether the business combination is fair to our public shareholders from a financial point of view. We will complete our initial business combination only if the post-business combination company in which our public shareholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or is otherwise not required to register as an investment company under the Investment Company Act. Even if the post-business combination company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post-business combination company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target, or issue a substantial number of new shares to third-parties in connection with financing our initial business combination. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-business combination company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test described above, provided that in the event that the business combination involves more than one target business, the 80% of net assets test will be based on 28 Table of Contents the aggregate value of all of the target businesses and we will treat the transactions together as our initial business combination for purposes of seeking shareholder approval or conducting a tender offer, as applicable. Permitted purchases of public shares and public warrants by our affiliates If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, initial shareholders, directors, officers, advisors or their affiliates may purchase shares or public warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. There is no limit on the number of shares our initial shareholders, directors, officers, advisors or their affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds held in the trust account will be used to purchase shares or public warrants in such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Securities Exchange Act of 1934, as amended, or the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. See "Proposed Business—Effecting Our Initial Business Combination— Permitted Purchases of Our Securities." for a description of how our sponsor, initial shareholders, directors, officers, advisors or any of their affiliates will select which shareholders to purchase securities from in any private transaction. Our sponsor, directors, officers, advisors or any of their affiliates will not make any purchases if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. The purpose of any such purchases of shares could be to vote such shares in favor of the initial business 29 Table of Contents combination and thereby increase the likelihood of obtaining shareholder approval of the initial business combination or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public "float" of our Class A ordinary shares or warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Redemption rights for public shareholders upon completion of our initial business combination We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations and on the conditions described herein. The amount in the trust account is initially anticipated to be $10.30 per unit and such amount may be increased by $0.10 per unit in the event we decide to extend the time to consummate our business combination by three months, and may be further increased by $0.10 per unit in the event we decide to further extend the time to consummate our business combination by an additional three months (for a maximum extension of six months), as described herein. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination. 30 Table of Contents Manner of conducting redemptions We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a general meeting called to approve the initial business combination or (ii) without a shareholder vote by means of a tender offer. The decision as to whether we will seek shareholder approval of a proposed initial business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under applicable law or stock exchange listing requirements. Asset acquisitions and share purchases would not typically require shareholder approval while direct mergers with our company and any transactions where we issue more than 20% of our issued and outstanding Class A ordinary shares or seek to amend our amended and restated memorandum and articles of association would require shareholder approval. So long as we obtain and maintain a listing for our securities on Nasdaq, we will be required to comply with Nasdaq s shareholder approval rules. The requirement that we provide our public shareholders with the opportunity to redeem their public shares by one of the two methods listed above will be contained in provisions of our amended and restated memorandum and articles of association and will apply whether or not we maintain our registration under the Exchange Act or our listing on Nasdaq. Such provisions may be amended if approved by holders of two-thirds of our ordinary shares entitled to vote thereon. If we provide our public shareholders with the opportunity to redeem their public shares in connection with a general meeting, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and file proxy materials with the SEC. If we seek shareholder approval, we will complete our initial business combination only if we receive an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the 31 Table of Contents shareholders who attend and vote at a general meeting of the company. A quorum for such meeting will be present if the holders of a majority of issued and outstanding shares entitled to vote at the meeting are represented in person or by proxy. Our initial shareholders will count toward this quorum and, pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote their founder shares and any public shares purchased during or after this offering (including in open market and privately-negotiated transactions) in favor of our initial business combination. For purposes of seeking approval of an ordinary resolution, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. As a result, in addition to our initial shareholders founder shares, we would need 7,500,001, or 37.5%, of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming all outstanding shares are voted and the over-allotment option is not exercised). These quorum and voting thresholds, and the voting agreements of our initial shareholders, may make it more likely that we will consummate our initial business combination. Each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction or whether they were a public shareholder on the record date for the general meeting held to approve the proposed transaction. If a shareholder vote is not required and we do not decide to hold a shareholder vote for business or other legal reasons, we will: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about our initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering more than the 32 Table of Contents number of shares we are permitted to redeem. If public shareholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete such initial business combination. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase our Class A ordinary shares in the open market, in order to comply with Rule 14e-5 under the Exchange Act. We intend to require our public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in "street name," to, at the holder s option, either deliver their share certificates to our transfer agent or deliver their shares to our transfer agent electronically using the Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) system, prior to the date set forth in the proxy materials or tender offer documents, as applicable. In the case of proxy materials, this date may be up to two business days prior to the scheduled vote on the proposal to approve the initial business combination. In addition, if we conduct redemptions in connection with a shareholder vote, we intend to require a public shareholder seeking redemption of its public shares to also submit a written request for redemption to our transfer agent two business days prior to the scheduled vote in which the name of the beneficial owner of such shares is included. The proxy materials or tender offer documents, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public shareholders to satisfy such delivery requirements. We believe that this will allow our transfer agent to efficiently process any redemptions without the need for further communication or action from the redeeming public shareholders, which could delay redemptions and result in additional administrative cost. If the proposed initial business combination is not approved and we continue to search for a target company, we will promptly return any certificates or shares delivered by public shareholders who elected to redeem their shares. Our amended and restated memorandum and articles of association provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001. In addition, our proposed initial business combination may impose a minimum cash requirement for (i) cash 33 Table of Contents consideration to be paid to the target or its owners, (ii) cash for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions. In the event the aggregate cash consideration we would be required to pay for all Class A ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will not complete the initial business combination or redeem any shares, and all Class A ordinary shares submitted for redemption will be returned to the holders thereof. We may, however, raise funds through the issuance of equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements or backstop arrangements we may enter into following consummation of this offering, in order to, among other reasons, satisfy such net tangible assets or minimum cash requirements. Limitation on redemption rights of shareholders holding 15% or more of the shares sold in this offering if we hold shareholder vote Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a "group" (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering without our prior consent. We believe the restriction described above will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us, our sponsor or our management at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our 34 Table of Contents ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be used to pay amounts due to any public shareholders who exercise their redemption rights as described above under "Redemption rights for public shareholders upon completion of our initial business combination," to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may use the balance of the cash released to us from the trust account following the closing for general corporate purposes, including for maintenance or expansion of operations of post-business combination businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our amended and restated memorandum and articles of association provide that we will have only 15 months from the closing of this offering to complete our initial business combination. However, in our sole discretion, we may, but are not obligated to, extend the period of time to consummate a business combination by two additional three month periods (for a total of up to 21 months to complete a business combination); provided that our sponsor, as defined below (or its designees) must deposit into the trust account funds equal to $0.10 per unit sold in this offering for each three month extension, for an aggregate additional amount of $2,000,000 (or $2,300,000 if the underwriters over-allotment option is exercised in full) for each such extension, in exchange for a non-interest bearing, unsecured promissory note to be repaid by us following our business combination. Such 35 Table of Contents loan may be convertible into warrants, at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants. If we have not completed our initial business combination within such period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any) and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in each case, to our obligations under Cayman Islands law to provide for claims of creditors and in all cases subject to the other requirements of applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within the allotted time period. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to any founder shares held by them if we fail to complete our initial business combination within 15 months from the closing of this offering (or up to within 21 months if we extend the period of time to consummate our initial business combination in accordance with the terms described in this prospectus). However, if our initial shareholders or management team acquire public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted time period. The underwriters have agreed to waive their rights to their deferred underwriting commission held in the trust account in the event we do not complete our initial business combination within 15 months from the closing of this offering (or up to within 21 months if we extend the period of time to consummate our initial business combination in accordance with the terms described in this prospectus) and, in such event, such 36 Table of Contents amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. Redemption rights in connection with proposed amendments to our amended and restated memorandum and articles of association Our sponsor, officers and directors have agreed, pursuant to a letter agreement, that they will not propose any amendment to our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months from the closing of this offering (or up to within 21 months if we extend the period of time to consummate our initial business combination in accordance with the terms described in this prospectus) or (B) with respect to any other material provisions relating to shareholders rights or pre-initial business combination activity, unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations and on the conditions described above under "Limitations on redemptions." For example, our board of directors may propose such an amendment if it determines that additional time is necessary to complete our initial business combination. In such event, we will conduct a proxy solicitation and distribute proxy materials pursuant to Regulation 14A of the Exchange Act seeking shareholder approval of such proposal, and in connection therewith, provide our public shareholders with the redemption rights described above upon shareholder approval of such amendment. Limited payments to insiders There will be no finder s fees, reimbursement, consulting fee, monies in respect of any payment of a loan or other compensation paid by us to our sponsor, officers or directors, or any affiliate of our sponsor or officers prior to, or in connection with any services rendered in order to effectuate, the consummation of our initial business combination (regardless of the type of transaction that it is). However, the following payments will be made to our sponsor, officers or directors, or our or their affiliates, and, if made prior to our initial business combination will be made from funds held outside the trust account: 37 Table of Contents repayment of up to an aggregate of $500,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; payment to our sponsor or an affiliate thereof of up to $10,000 per month for office space, utilities, salaries or other cash compensation paid to consultants to our sponsor, secretarial and administrative support services provided to us and other expenses and obligations of our sponsor; reimbursement for any out-of-pocket expenses related to identifying, investigating, negotiating and completing an initial business combination; and repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination. Up to $2,000,000 of such loans may be convertible into private placement warrants of the post-business combination entity at a price of $1.00 per warrant at the option of the lender. Such warrants would be identical to the private placement warrants. Except for the foregoing, the terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. Audit Committee We will establish and maintain an audit committee, which will be composed entirely of independent directors. Among its responsibilities, the audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliates and monitor compliance with the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to promptly take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled "Management—Committees of the Board of Directors—Audit Committee." 38 Table of Contents Risks We are a blank check company that has conducted no operations and has generated no revenues to date. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision whether to invest in our securities, you should consider not only the background of our management team, but also the special risks we face as a blank check company. This offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see "Proposed Business—Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419." You should carefully consider these and the other risks set forth in the section entitled "Risk Factors". 39 Table of Contents Summary Financial Data The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. December 31, 2021 Actual As Adjusted(1) Balance Sheet Data: Working capital (deficiency)(2) (663,597) 2,285,132 Total assets(3) 639,169 208,285,132 Total liabilities(4) 664,037 21,963,000 Value of Class A ordinary shares that may be redeemed in connection with our initial business combination ($10.30 per share)(5) — 206,000,000 Shareholder s deficit(6) (24,868) (19,677,868) (1)Assumes the full forfeiture of 750,000 Class B ordinary shares that are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. (2)The "as adjusted" calculation includes $2,310,000 cash held outside the trust account, plus $24,868 of actual shareholders deficit. (3)The "as adjusted" calculation equals $206,000,000 in cash held in trust from the proceeds of this offering and the sale of the private placement warrants, plus $2,310,000 in cash held outside the trust account, plus $24,868 of actual shareholders deficit. (4)The "as adjusted" calculation includes $7,000,000 of deferred underwriting commissions and $14,963,000 of derivative warrant liabilities. (5)The "as adjusted" calculation equals the 20,000,000 Class A ordinary shares purchased in the public offering, multiplied by the redemption value of $10.30 per share. Shares are classified as temporary equity in accordance with ASC 480, distinguishing liabilities from equity. (6)The "as adjusted" calculation equals the "as adjusted" total assets, less the "as adjusted" total liabilities, less the value of Class A ordinary shares that may be redeemed in connection with our initial business combination (approximately $10.30 per share). If no business combination is completed within the period to consummate the initial business combination, the proceeds then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes as well as expenses relating to the administration of the trust account (less up to $100,000 of interest to pay dissolution expenses), will be used to fund the redemption of our public shares. Our sponsor, directors and each member of our management team have entered into a letter agreement with us, pursuant to which they have agreed to waive their rights to liquidating distributions from the trust account with respect to any founder shares held by them if we do not complete our initial business combination within the allotted time period. 40 Table of Contents Cautionary Note Regarding Forward-Looking Statements and Risk Factor Summary Some of the statements contained in this prospectus may constitute "forward-looking statements" for purposes of the federal securities laws. Our forward-looking statements include, but are not limited to, statements regarding our or our management team s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "plan," "possible," "potential," "predict," "project," "should," "would" and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this prospectus may include, for example, statements about: our being a company with no operating history and no revenues; past performance of our management team, Patria, our sponsor, or their respective affiliates may not be indicative of future performance of an investment in us; our ability to select an appropriate target business or businesses; our ability to complete our initial business combination; our ability to obtain or maintain the listing of our securities on Nasdaq; our expectations around the performance of the prospective target business or businesses; our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination; our initial shareholders controlling the election of our board of directors and electing all of our directors; our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our initial business combination; our potential ability to obtain additional financing to complete our initial business combination; actual and potential conflicts of interests relating to Patria, and our sponsor, officers, directors, security holders, clients and their respective affiliates that may conflict with our interests; our pool of prospective target businesses, including opportunities in Latin America; our ability to consummate an initial business combination due to the uncertainty resulting from the ongoing COVID-19 pandemic; the ability of our officers and directors to generate a number of potential business combination opportunities; the potential risks subsequent to our initial business combination with respect to where our assets will be located, potential reincorporation elsewhere, where our directors and officers will reside and our directors and officers familiarity with U.S. securities laws; our public securities potential liquidity and trading; the possibility that our initial shareholders may receive additional Class A ordinary shares based on our trading price and/or based on certain strategic transactions after our initial business combination; 41 Table of Contents the potential risks associated with us being incorporated under the laws of the Cayman Islands; the lack of a market for our securities; the use of proceeds not held in the trust account or available to us from interest income on the trust account balance; the performance of Latin American markets and the availability of a suitable target for an initial business combination transaction in Latin America; additional burdens that we may face in finding, investigating, agreeing to and completing an initial business combination transaction in Latin America; and additional risks in pursuing a target company with operations in Latin America that may negatively impact our operations following the business combination; the potential risks associated with acquiring and operating a business in foreign countries; the trust account not being subject to claims of third parties; our financial performance following this offering; or the other risks and uncertainties described under the heading "Risk Factors" and elsewhere in this prospectus. The forward-looking statements contained in this prospectus are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described under the heading "Risk Factors". Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. Summary of Risk Factors An investment in our securities is subject to
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and articles of association are to the amended and restated memorandum and articles of association that the company will adopt prior to the consummation of this offering; Companies Act are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; founder shares are to our Class B ordinary shares initially issued to our sponsor in a private placement prior to this offering, some of which were subsequently transferred to certain of our directors, and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof (for the avoidance of doubt, such Class A ordinary shares will not be public shares ); initial shareholders refers to all of our shareholders immediately prior to the date of this prospectus, including all of our directors to the extent they hold such shares; management or our management team are to our executive officers and directors; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private placement warrants are to the warrants to be issued to our sponsor in a private placement simultaneously with the closing of this offering and upon conversion of working capital loans, if any; public shares are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders are to the holders of our public shares, including our initial shareholders, sponsor and management team to the extent our sponsor and/or members of our management team purchase public shares, provided that our sponsor s and each member of our management team s status as a public shareholder will only exist with respect to such public shares; sponsor are to Reverence Acquisition Holdings, LLC, a Cayman Islands limited liability company; warrants are to our redeemable warrants, which includes the public warrants as well as the private placement warrants to the extent they are no longer held by the initial purchasers of the private placement warrants or their permitted transferees; and we, us, our, company or our company are to Reverence Acquisition Corp., a Cayman Islands exempted company. Any forfeiture of shares described in this prospectus will take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their option to purchase additional units. TABLE OF CONTENTS Subject to Completion, dated February 14, 2022 PRELIMINARY PROSPECTUS Reverence Acquisition Corp. $300,000,000 30,000,000 Units Reverence Acquisition Corp. is a blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. We will not be limited to a particular industry or geographic region in our identification and acquisition of a target company. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share and one-third of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment, terms and limitations as described herein. Only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least three units, you will not be able to receive or trade a whole warrant. The warrants will become exercisable on the later of 30 days after the completion of our initial business combination or 12 months from the closing of this offering, and will expire five years after the completion of our initial business combination or earlier upon redemption or our liquidation, as described herein. The underwriters have a 45-day option from the date of this prospectus to purchase up to 4,500,000 additional units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares that were sold as part of the units in this offering, which we refer to collectively as our public shares, upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations as described herein. If we have not consummated an initial business combination within 24 months from the closing of this offering, we will redeem 100% of the public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (less taxes payable and up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions as described herein. Our sponsor has agreed to purchase 6,000,000 warrants (or 6,600,000 warrants if the underwriters option to purchase additional units is exercised in full), each exercisable to purchase one Class A ordinary share at $11.50 per share, subject to adjustment, at a price of $1.50 per warrant in a private placement to occur concurrently with the closing of this offering. The private placement warrants are identical to the warrants sold in this offering, subject to certain limited exceptions as described in this prospectus. Our initial shareholders, which include our sponsor, currently own 8,625,000 Class B ordinary shares, up to 1,125,000 of which are subject to forfeiture depending on the extent to which the underwriters option to purchase additional units is exercised. The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described herein. Prior to our initial business combination, only holders of our Class B ordinary shares will be entitled to vote on the appointment of directors. Currently, there is no public market for our securities. We intend to apply to have our units listed on the New York Stock Exchange ( NYSE ), under the symbol RCPIU. We expect that the Class A ordinary shares and warrants comprising the units will begin separate trading on the NYSE under the symbols RCPI and RCPIW, respectively, on the 52nd day following the date of this prospectus unless the representatives of the underwriters permit earlier separate trading and we have satisfied certain conditions. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 34 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the U.S. Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 300,000,000 Underwriting discounts and commissions(1) $ 0.55 16,500,000 Proceeds, before expenses, to us $ 9.45 283,500,000 (1) Includes $0.20 per unit, or $6,000,000 in the aggregate ($6,900,000 if the underwriters option to purchase additional units is exercised in full), payable to the underwriters upon the closing of this offering. Also includes $0.35 per unit, or $10,500,000 in the aggregate (or $12,075,000 in the aggregate if the underwriters option to purchase additional units is exercised in full), payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein and released to the underwriters only upon the consummation of an initial business combination. See Underwriting for a description of compensation payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $300,000,000, or $345,000,000 if the underwriters option to purchase additional units is exercised in full ($10.00 per unit in either case), will be deposited into a U.S. based trust account at J.P. Morgan Chase Bank, N.A. with Continental Stock Transfer & Trust Company acting as trustee. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2022. Joint Bookrunners Goldman Sachs & Co. LLC Citigroup Deutsche Bank Securities Cantor Co-Manager Siebert Williams Shank The date of this prospectus is , 2022 TABLE OF CONTENTS Our Company General We are a blank check company newly incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not identified any potential business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any potential business combination target. To date, our efforts have been limited to organizational activities. While we may pursue an acquisition opportunity in any business industry or sector, we intend to capitalize on the ability of our management team to identify, acquire and manage a market-leading business that may provide opportunities for attractive risk-adjusted returns. Our sponsor is an affiliate of Reverence Capital Partners L.P. ( Reverence Capital ), a private investment firm focused on the financial services sector. Through our affiliation with Reverence Capital, we intend to capitalize on its private equity and structured credit expertise to source and evaluate attractive, high growth private companies. Although we will not be limited to a particular industry or geographic region in our identification and acquisition of a target company, we believe the financial technology and other growth-oriented subsectors of the financial services industry present particularly attractive investment opportunities. Reverence Capital Founded in 2013 in New York, Reverence Capital is a private investment firm focused on two complementary and synergistic businesses: (i) thematic investing in leading global, middle-market financial services businesses through control and influence-oriented investments and (ii) opportunistic, structured credit and credit-related investments. Reverence Capital is composed of 17 private equity investment professionals, 7 credit investment professionals, and 9 support professionals. In addition, the firm benefits from their network of 16 C-Suite Special Advisors who bring deep operating experience and additional relationships to Reverence across all sectors of financial services. Reverence Capital has invested approximately $5.4 billion to date across two private equity funds, co-investment vehicles and investment partners. Reverence Capital was founded by Milton Berlinski, Peter Aberg and Alex Chulack, after distinguished careers advising and investing in a broad array of financial services businesses. The founders collectively bring nearly 100 years of advisory and investing experience across a wide range of financial services sectors including asset management, banks and specialty finance, capital markets, financial technology and insurance. In addition to this, the founders bring long-lasting relationships with a broad universe of leading financial services companies across sectors of focus. Reverence Capital focuses on a broad spectrum of middle-market financial services companies. It invests in leading financial services companies and collaborates with management to drive long-term success. Reverence Capital targets control and influence-oriented minority investments, but remains flexible on the form and structure of the ultimate investment. Reverence Capital s investment philosophy encompasses the following characteristics: Specialization and superior knowledge in the financial services industry; Aim to achieve consistent investment performance over extended periods through in-depth research and proactive targeting; Deep understanding of financial services businesses and teams combined with active portfolio management Structured investment process and portfolio company oversight to preserve capital and prevent losses Focus on businesses and segments well-positioned and aligned with long-term trends and offering a margin of safety; and Active management to enhance growth and drive ongoing value creation. TABLE OF CONTENTS Reverence Capital invests on behalf of a diverse group of investors, including: public and private pension plans, sovereign wealth funds, university endowments, foundations, family offices and high-net-worth individuals. The team has committed substantial personal capital to Reverence Capital s funds in order to align interests with those of its investors and portfolio executives. Reverence Capital s current investments include: Advisor Group, CardWorks, Diamond Resorts, DMG Bancshares, Russell Investments, Transact, Venerable, Victory Capital and Vida Capital. Reverence Capital also recently agreed to acquire Wells Fargo Asset Management division on February 23, 2021. Selected prior investments of the Reverence Capital team prior to forming Reverence Capital include: BM&F Bovespa, First Republic, Kabbage, KCG, Novis, Nymex, Oak Hill Advisors, Pierpoint, RiskMetrics Group and Sura. To date, 13 of 16 investments were sourced directly from Reverence Capital s proprietary network. The other 3 opportunities were each sourced from a narrow limited process also taking advantage of the firm s network. Reverence Capital s strong track record of generating industry-leading returns is a function of its rigorous and systematic investment selection process and the investment expertise of its key decision makers. The investment in the Company will eventually make will be subject to the same rigorous review process led by the same key individuals. Our Management Team Our management team is led by Milton Berlinski, our Chairman and Chief Executive Officer, and David Sloane, our Chief Financial Officer. Mr. Berlinski and Mr. Sloane are also employees of Reverence Capital. We believe our team has the required investment, operational, diligence and capital raising expertise, as well as relationships with financing, deal sourcing and advisory counterparties to effect a business combination with an attractive target and to position it for long-term success in the public markets. Milton Berlinski serves as our Chairman and Chief Executive Officer. Mr. Berlinski co-founded Reverence Capital in June 2013 after concluding a 26-year career at Goldman Sachs, which he joined in 1986 and where he served as a founding member of the Financial Institutions Group in Investment Banking, focusing on banks, consumer and commercial finance companies, asset management, insurance and capital markets. He also served as Head of Strategy and Corporate Development in the period after Goldman Sachs IPO, assisting the Executive Office and division leaders to create and execute a strategy to build out Goldman Sachs global footprint. For the final 10 years of his Goldman Sachs tenure, Mr. Berlinski had global responsibility for coverage of the firm s financial sponsor and hedge fund clients, overseeing a dramatic increase in revenue from the business and working alongside Goldman Sachs Merchant Banking team on co-investment opportunities in transactions involving the firm s clients. Mr. Berlinski has led or executed over 250 transactions in financial services across all sectors, including numerous strategic acquisitions by Goldman Sachs itself. Mr. Berlinski was also a member of the Operating Committee and the Compensation Committee during his time at the firm. He received a BA in engineering from California State University, Northridge, in 1978 and an MBA from Wharton in 1980. Mr. Berlinski serves on the board of directors for Victory Capital, Russell Investments, Diamond Resorts, Venerable Holdings (HoldCo), Transact, Advisor Group, Vida Capital and DMG Bancshares. He also serves on the Board of the Ronald McDonald House, the Advisory Board of the Wharton Graduate School of Business and The Mount Sinai Department of Surgery Advisory Board. He also is a Board Member of the New America Alliance, supporting Latino leadership in entrepreneurship, corporate America, and public service. David Sloane serves as our Chief Financial Officer. Mr. Sloane is Reverence Capital s Vice President of Finance and Controller since August 2014. Previously Mr. Sloane worked at Uretek LLC, Goldman Sachs and WTAS LLC (now known as Andersen) in various accounting and tax capacities. Mr. Sloane received a B.S. in Accounting from Bentley University in 2007 and an M.S. in Taxation from Bentley University in 2009. Our Independent Directors Our efforts to seek a suitable business combination target will be complemented and augmented by the expertise and network of the relationships of our independent directors, Ms. Karin Hirtler-Garvey, Mr. Jonathan Ziglar and Mr. Ronald Hynes, each of whom has extensive experience in business and financial matters. TABLE OF CONTENTS For additional information regarding our independent directors, see Management Officers and Directors. Business Strategy We will seek to capitalize on Reverence Capital s experience and investment philosophy that focuses on thematic investing in middle-market financial services businesses through control and influence-controlled investments, with deep credit expertise. Our acquisition and value creation strategy is to acquire a financial services company, utilizing the extensive relationships we have fostered over decades of investing and advising in the industry, and, after our initial business combination, build a company in the public markets. We intend on focusing our attention on businesses within the Insurance, Asset / Wealth Management, Financial Technology / Payments, Capital Markets and Depositories & Finance sectors. The global financial services industry presents us with a compelling opportunity to unlock value given it s both large and fragmented, where the US alone has approximately 6,500 independent banks, approximately 6,000 insurance companies and more than 4,000 brokerage firms. At the same time, the international financial services industry is highly regulated with complex accounting rules, resulting in robust barriers to entry. This presents unique opportunities for our firm to utilize its specialized knowledge across economic cycles in both growth-oriented and value-driven opportunities, where we are comfortable with the underlying assets and long-term business model. The selection process will leverage our pro-active, thematic sourcing strategy and focus on companies where we believe the combination of our relationships, capital and capital markets expertise can be catalysts to transform these companies and accelerate growth and performance. Our focus will be on business models with i) strong defensible franchises, ii) growing revenue and earnings which are expected to generate strong free cash flow or attractive returns on retained capital, and iii) strong management teams already in place or where we see an opportunity to supplement management through our firm s network of contacts. Key components of our business strategy include: Leverage Reverence Capital s Deep Industry Knowledge. Founders of Reverence Capital, Milton Berlinski, Peter Aberg and Alexander Chulack, have nearly 100 years of investing and advisory experience across all sectors of financial services. The firm consists of 33 professionals across private equity and credit, amongst others, with an additional 16 C-Suite Special Advisors who bring deep operating experience and additional relationships to the Reverence network. Proprietary Sourcing Capabilities and Leading Industry Relationships. Our management team s deep network of contacts provides critical support in all aspects of the evaluation and development of investment ideas, access to target companies and assistance throughout the diligence process. Research Driven Approach. Our firm s strategy and focus is on value-driven and growth-oriented investments across the five main sub-sectors of financial services where our firm has deep industry knowledge. Our investment ideas are generated through an iterative research process, where we can actively implement operational change driven by our sector expertise and committee oversight. Tried and Tested Investment Philosophy. We pride ourselves on being a full-time practitioner with a single investment focus uniquely positioned within financial services. We use our superior knowledge and expertise to identify opportunities using a bottoms-up, proprietary sector-driven appraisal methodology to pursue long-term themes. Hands-on Value Creation. Our firm focuses on driving value creation across our investments through our relationship network by building management teams, providing strategic assistance as needed, developing world class boards and providing dedicated business resources. We believe that the wide networks of our management team will deliver access to a broad spectrum of opportunities across the financial services landscape. In addition, given our profile and sector-specific focus, we anticipate that target business candidates may be brought to our attention from various unaffiliated sources, including investment market participants, private equity groups, investment banking firms, consultants, accounting firms and large business enterprises. Upon completion of this offering, members of our management team will communicate with their network of relationships to articulate our acquisition TABLE OF CONTENTS criteria, including the parameters of our search for a target business, and will begin the disciplined process of pursuing and reviewing promising leads. Acquisition Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective targets for our initial business combination. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. We intend to acquire one or more target businesses that we believe: would benefit uniquely from the capabilities of our management team. We will seek to acquire or merge with a business that could leverage the collective capabilities of our management to tangibly improve profitability; are fundamentally sound companies that can enhance shareholder value through a combination with us, and offer an attractive risk-adjusted return for our shareholders; have strong, experienced management teams, or where our firm sees a platform to assemble an effective management team through our network of contacts; are at an inflection point, such as requiring additional management expertise, are able to innovate through new operational techniques, or where we believe we can drive improved financial performance; have a proven business model with strong, defensible franchises; have a history of growing revenue and earnings, which are expected to or have potential for, strong, stable free cash flow generation, with predictable and recurring revenue streams; can grow both organically and where we believe our ability to source proprietary opportunities and execute transactions will help the business grow through additional acquisitions; can benefit from being a publicly traded company, with access to the broader capital markets and leveraging Reverence s expertise in the capital markets, to achieve the company s growth strategy; and exhibit unrecognized value or other characteristics that we believe can be enhanced based on our analysis and due diligence review. These criteria and guidelines are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general criteria and guidelines as well as other considerations, factors, criteria and guidelines that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria and guidelines in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC. Initial Business Combination So long as our securities are then listed on the NYSE, NYSE rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the net assets held in the trust account (net of amounts disbursed to management for working capital purposes and excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of signing a definitive agreement in connection with our initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or an independent valuation or appraisal firm with respect to the satisfaction of such criteria. While we consider it unlikely that our board will not be able to make an independent determination of the fair market value of a target business or businesses, it may be unable to do so if the board is less familiar or experienced with the target company s business, there is a significant amount of uncertainty as to the value of the company s assets or prospects, including if such company is at an early stage of development, operations or growth, or if the anticipated TABLE OF CONTENTS transaction involves a complex financial analysis or other specialized skills and the board determines that outside expertise would be helpful or necessary in conducting such analysis. Since any opinion, if obtained, would merely state that the fair market value of the business combination meets the 80% of net assets threshold, unless such opinion includes material information regarding the valuation of a business combination or the consideration to be provided, it is not anticipated that copies of such opinion would be distributed to our shareholders. However, if required under applicable law, any proxy statement that we deliver to shareholders and file with the SEC in connection with a proposed transaction will include such opinion. We anticipate structuring our initial business combination so that the post-business combination company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-business combination company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-business combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-business combination company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-business combination company, depending on valuations ascribed to the target and us in the business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-business combination company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. In addition, we have agreed not to enter into a definitive agreement regarding an initial business combination without the prior consent of our sponsor. If our securities are not then listed on the NYSE for whatever reason, we would no longer be required to meet the foregoing 80% of net asset test. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor or any of our officers or directors, we, or a committee of independent directors, will obtain an opinion from either an independent investment banking firm that is a member of the Financial Industry Regulatory Authority ( FINRA ) or an independent accounting firm that such initial business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other context. To the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors. The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the funds held outside the trust account. Other Considerations In addition, certain of our officers and directors presently have, and any of them in the future may have additional, fiduciary and contractual duties to other entities. As a result, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he, TABLE OF CONTENTS she or it has then-current fiduciary or contractual obligations, then, subject to their fiduciary duties under Cayman Islands law, he, she or it will need to honor such fiduciary or contractual obligations to present such business combination opportunity to such entity, before we can pursue such opportunity. If these other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. However, we do not expect these duties to materially affect our ability to complete our initial business combination. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and us, on the other. Our sponsor, officers and directors may sponsor, form or participate in other blank check companies similar to ours during the period in which we are seeking an initial business combination. Any such companies may present additional conflicts of interest in pursuing an acquisition target, particularly in the event there is overlap among investment mandates. However, we do not currently expect that any such other blank check company would materially affect our ability to complete our initial business combination. In addition, our sponsor, officers and directors, are not required to commit any specified amount of time to our affairs, and, accordingly, will have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. Corporate Information Our executive offices are located at 590 Madison Avenue, New York, NY 10022, and our telephone number is (212) 804-8025. The information contained on or accessible through our corporate website or any other website that we may maintain is not part of this prospectus or the registration statement of which this prospectus is a part. We are a Cayman Islands exempted company. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and expect to receive, after the effectiveness of the registration statement of which this prospectus forms a part, a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. TABLE OF CONTENTS We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that are held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements, and, if their revenues are less than $100 million, not providing an independent registered public accounting firm attestation on internal control over financial reporting. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates exceeds $250 million as of the prior June 30, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates exceeds $700 million as of the prior June 30. TABLE OF CONTENTS THE OFFERING In deciding whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors of this prospectus. Securities offered 30,000,000 units (or 34,500,000 units if the underwriters over-allotment option is exercised in full), at $10.00 per unit, each unit consisting of: one Class A ordinary share; and one-third of one redeemable warrant. Proposed NYSE symbols Units: RCPIU Class A ordinary shares: RCPI Warrants: RCPIW Trading commencement and separation of Class A ordinary shares and warrants The units are expected to begin trading on or promptly after the date of this prospectus. The Class A ordinary shares and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless the representatives of the underwriters inform us of their decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the Class A ordinary shares and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into Class A ordinary shares and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least three units, you will not be able to receive or trade a whole warrant. Additionally, the units will automatically separate into their component parts and will not be traded after completion of our initial business combination. Separate trading of the Class A ordinary shares and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A ordinary shares and warrants be traded separately until we have filed with the SEC a Current Report on Form 8-K which includes an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering. If the underwriters option to purchase additional units is exercised following the initial filing of such Current Report on Form 8-K, TABLE OF CONTENTS a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters option to purchase additional units. Units: Number outstanding before this offering 0 Number outstanding after this offering 30,000,000(1) Ordinary shares: Number outstanding before this offering 8,625,000(2)(3) Number outstanding after this offering 37,500,000(1)(2)(4) Warrants: Number of private placement warrants to be sold in a private placement simultaneously with this offering 6,000,000(1) Number of warrants to be outstanding after this offering and the sale of private placement warrants 16,000,000(1) 1 Assumes no exercise of the underwriters option to purchase additional units and the corresponding forfeiture of 1,125,000 founder shares. 2 Founder shares are currently classified as Class B ordinary shares, which shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described below adjacent to the caption Founder shares conversion and anti-dilution rights and in our amended and restated memorandum and articles of association. Such Class A ordinary shares delivered upon conversion will not have any redemption rights or be entitled to liquidating distributions from the trust account if we do not consummate an initial business combination. 3 Includes 1,125,000 founder shares that are subject to forfeiture to the extent the underwriters do not exercise their option to purchase additional units in full. 4 Includes 30,000,000 public shares and 7,500,000 founder shares, assuming 1,125,000 founder shares have been forfeited. Exercisability Each whole warrant is exercisable to purchase one Class A ordinary share, subject to adjustment as described herein. Only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least three units, you will not be able to receive or trade a whole warrant. We structured each unit to contain one-third of one redeemable warrant, with each whole warrant exercisable for one Class A ordinary share, as compared to units issued by some other similar blank check companies which contain whole warrants exercisable for one share, in order to reduce the dilutive effect of the warrants upon completion of our initial business TABLE OF CONTENTS combination as compared to units that each contain a whole warrant to purchase one share, thus making us, we believe, a more attractive business combination partner for target businesses. Exercise price $11.50 per share, subject to adjustments as described herein. In addition, if (x) we issue additional Class A ordinary shares or equity-linked securities, for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per ordinary share (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or such affiliates, as applicable, prior to such issuance) (the Newly Issued Price ), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our Class A ordinary shares during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the Market Value ) is below $9.20 per share, and the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, the $18.00 per share redemption trigger price described adjacent to Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00 and Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00 will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price, and the $10.00 per share redemption trigger price described adjacent to the caption Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00 will be adjusted (to the nearest cent) to be equal to the higher of the Market Value and the Newly Issued Price. Exercise period The warrants will become exercisable on the later of: 30 days after the completion of our initial business combination; and twelve months from the closing of this offering; provided in each case that we have an effective registration statement under the Securities Act covering the issuance of the Class A ordinary shares issuable upon exercise of the warrants and a current prospectus relating to them is available and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement, including as a result of a notice of redemption described below under Redemption of warrants when the price per Class A ordinary share equals or exceeds TABLE OF CONTENTS $10.00 ). If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. We are not registering the Class A ordinary shares issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable, but in no event later than twenty business days after the closing of our initial business combination, we will use our commercially reasonable efforts to file with the SEC a registration statement covering the Class A ordinary shares issuable upon exercise of the warrants, and we will use our commercially reasonable efforts to cause the same to become effective within 60 business days after the closing of our initial business combination, and to maintain the effectiveness of such registration statement and a current prospectus relating to those Class A ordinary shares until the warrants expire or are redeemed, as specified in the warrant agreement provided that if our Class A ordinary shares are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement. If a registration statement covering the Class A ordinary shares issuable upon exercise of the warrants is not effective by the 60th day after the closing of the initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption, but we will use our commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00 Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the private placement warrants): in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period ; and TABLE OF CONTENTS if, and only if, the last reported sale price (the closing price ) of our Class A ordinary shares equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading Description of Securities Warrants Public Shareholders Warrants Anti-Dilution Adjustments ) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. We will not redeem the warrants as described above unless an effective registration statement under the Securities Act covering the Class A ordinary shares issuable upon exercise of the warrants is effective and a current prospectus relating to those Class A ordinary shares is available throughout the 30-day redemption period. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. Except as set forth below, none of the private placement warrants will be redeemable by us so long as they are held by our sponsor or its permitted transferees. Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00 Once the warrants become exercisable, we may redeem the outstanding warrants: in whole and not in part; at $0.10 per warrant upon a minimum of 30 days prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to the table set forth under Description of Securities Warrants Public Shareholders Warrants based on the redemption date and the fair market value of our Class A ordinary shares (as defined below) except as otherwise described in Description of Securities Warrants Public Shareholders Warrants ; if, and only if, the closing price of our Class A ordinary shares equals or exceeds $10.00 per public share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading Description of Securities Warrants Public Shareholders Warrants Anti-Dilution Adjustments ) for any 20 trading days within the 30-trading day period ending three trading days before we send the notice of redemption to the warrant holders; and if the closing price of the Class A ordinary shares for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send TABLE OF CONTENTS the notice of redemption to the warrant holders is less than $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading Description of Securities Warrants Public Shareholders Warrants Anti-Dilution Adjustments ), the private placement warrants must also be concurrently called for redemption on the same terms as the outstanding public warrants, as described above. The fair market value of our Class A ordinary shares for the above purpose shall mean the volume weighted average price of our Class A ordinary shares during the 10 trading days immediately following the date on which the notice of redemption is sent to the holders of warrants. This redemption feature differs from the typical warrant redemption features used in other blank check offerings. We will provide our warrant holders with the final fair market value no later than one business day after the 10 trading day period described above ends. In no event will the warrants be exercisable in connection with this redemption feature for more than 0.361 Class A ordinary shares per warrant (subject to adjustment). No fractional Class A ordinary shares will be issued upon redemption. If, upon redemption, a holder would be entitled to receive a fractional interest in a share, we will round down to the nearest whole number of the number of Class A ordinary shares to be issued to the holder. Please see the section entitled Description of Securities Warrants Public Shareholders Warrants for additional information. Founder shares On March 9, 2021, our Sponsor paid $25,000, or approximately $0.003 per share, to cover certain expenses on our behalf in consideration of 8,625,000 Class B ordinary shares, par value $0.0001. In March 2021, our sponsor transferred an aggregate of 60,000 founder shares to our independent directors. The per share price of the founder shares was determined by dividing the amount contributed to the company by the number of founder shares issued. If we increase or decrease the size of this offering, we will effect a share capitalization or a share surrender or redemption or other appropriate mechanism, as applicable, with respect to our Class B ordinary shares immediately prior to the consummation of this offering in such amount as to maintain the number of founder shares, on an as-converted basis, at 20% of our issued and outstanding ordinary shares upon the consummation of this offering. Up to 1,125,000 founder shares are subject to forfeiture by the sponsor, depending on the extent to which the underwriters option to purchase additional units is exercised. TABLE OF CONTENTS The founder shares are identical to the Class A ordinary shares included in the units being sold in this offering, except that: prior to our initial business combination, only holders of the founder shares have the right to vote on the appointment of directors and holders of a majority of our founder shares may remove a member of the board of directors for any reason; the founder shares are subject to certain transfer restrictions, as described in more detail below; our initial shareholders have entered into an agreement with us, pursuant to which they have agreed to (i) waive their redemption rights with respect to their founder shares, (ii) waive their redemption rights with respect to their founder shares and public shares in connection with a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares and (iii) waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to consummate an initial business combination within 24 months from the closing of this offering (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). If we seek shareholder approval, we will complete our initial business combination only if we obtain the approval of an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the company. In such case, our initial shareholders have agreed to vote their founder shares and public shares in favor of our initial business combination. As a result, in addition to our initial shareholders founder shares, we would need 11,250,001, or 37.5% (assuming all issued and outstanding shares are voted and the underwriters option to purchase additional units is not exercised), or 1,875,001, or 6.25% (assuming only the minimum number of shares representing a quorum are voted and the underwriters option to purchase additional units is not exercised), of the 30,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved. However, if our initial business combination is structured as a statutory merger or TABLE OF CONTENTS consolidation with another company under Cayman Islands law, the approval of our initial business combination will require a special resolution passed by the affirmative vote of at least two-thirds of our ordinary shares which are represented in person or by proxy and are voted at a general meeting of the company; the founder shares will automatically convert into our Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described below adjacent to the caption Founder shares conversion and anti-dilution rights and in our amended and restated memorandum and articles of association; and the founder shares are entitled to registration rights. Transfer restrictions on founder shares Except as described herein, our initial shareholders have agreed not to transfer, assign or sell any of their founder shares and any Class A ordinary shares issuable upon conversion thereof until the earliest of (A) one year after the completion of our initial business combination or (B) subsequent to our initial business combination, (x) if the closing price of our Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, or (y) the date on which we complete a liquidation, merger, share exchange, reorganization or other similar transaction that results in all of our public shareholders having the right to exchange their ordinary shares for cash, securities or other property. Any permitted transferees would be subject to the same restrictions and other agreements of our initial shareholders with respect to any founder shares. Founder shares conversion and anti-dilution rights The founder shares are designated as Class B ordinary shares and will automatically convert into Class A ordinary shares, which such Class A ordinary shares delivered upon conversion will not have any redemption rights or be entitled to liquidating distributions if we do not consummate an initial business combination, at the time of our initial business combination or earlier at the option of the holders thereof at a ratio such that the number of Class A ordinary shares issuable upon conversion of all founder shares will equal, in the aggregate, on an as-converted basis, 20% of the sum of (i) the total number of ordinary shares issued and outstanding upon completion of this offering, plus (ii) the total number of Class A ordinary shares issued or deemed issued or issuable upon conversion or exercise of any equity-linked securities (as defined herein) or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of the initial business combination, excluding any Class A ordinary shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued, deemed issued, or to be TABLE OF CONTENTS issued, to any seller in the initial business combination and any private placement warrants issued to our sponsor, its affiliates or any member of our management team upon conversion of working capital loans. Any conversion of Class B ordinary shares described herein will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. In no event will the Class B ordinary shares convert into Class A ordinary shares at a rate of less than one-to-one. The term equity-linked securities refers to any debt or equity securities that are convertible, exercisable or exchangeable for our Class A ordinary shares issued in a financing transaction in connection with our initial business combination, including, but not limited to, a private placement of equity or debt. Appointment of directors; Voting rights Prior to our initial business combination, only holders of our founder shares will have the right to vote on the appointment of directors. Holders of our public shares will not be entitled to vote on the appointment of directors during such time. In addition, prior to the completion of an initial business combination, holders of a majority of our founder shares may remove a member of the board of directors for any reason. These provisions of our amended and restated memorandum and articles of association may only be amended by a special resolution passed by not less than two-thirds of our ordinary shares who attend and vote at our general meeting which shall include the affirmative vote of a simple majority of our Class B ordinary shares. With respect to any other matter submitted to a vote of our shareholders, including any vote in connection with our initial business combination, except as required by law, holders of our founder shares and holders of our public shares will vote together as a single class, with each share entitling the holder to one vote. In addition, pursuant to an agreement to be entered into on or prior to the closing of this offering, our sponsor, upon and following consummation of an initial business combination, will be entitled to nominate three individuals for appointment to our board of directors, as long as the sponsor holds any securities covered by the registration and shareholder rights agreement, which is described under the section of this prospectus entitled Description of Securities Registration and Shareholder Rights. Private placement warrants Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 6,000,000 private placement warrants (or 6,600,000 private placement warrants if the underwriters option to purchase additional units is exercised in full), each exercisable to purchase one Class A ordinary share at $11.50 per share, at a price of $1.50 per warrant ($9,000,000 in the aggregate or $9,900,000 if the underwriters option to purchase additional units is exercised in full), in a private placement that will close simultaneously with the closing of this offering. If we do not consummate an initial business TABLE OF CONTENTS combination within 24 months from the closing of this offering, the private placement warrants will expire worthless. The private placement warrants will be non-redeemable by us (except as set forth under Description of Securities Warrants Public Shareholders Warrants Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00 ) and exercisable on a cashless basis so long as they are held by our sponsor or its permitted transferees (see Description of Securities Warrants Private Placement Warrants ). If the private placement warrants are held by holders other than our sponsor or its permitted transferees, the private placement warrants will be redeemable by us in all redemption scenarios and exercisable by the holders on the same basis as the warrants included in the units being sold in this offering. If we do not complete our initial business combination within 24 months from the closing of this offering, the private placement warrants will expire worthless. Transfer restrictions on private placement warrants The private placement warrants (including the Class A ordinary shares issuable upon exercise of the private placement warrants) will not be transferable, assignable or salable until 30 days after the completion of our initial business combination, except as described herein under Principal Shareholders Restrictions on Transfers of Founder Shares and Private Placement Warrants. Cashless exercise of private placement warrants If holders of private placement warrants elect to exercise them on a cashless basis, except as described under Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00, they would pay the exercise price by surrendering their warrants for that number of Class A ordinary shares equal to the quotient obtained by dividing (x) the product of the number of Class A ordinary shares underlying the warrants, multiplied by the excess of the Sponsor fair market value (as defined below) over the exercise price of the warrants by (y) the Sponsor fair market value. The Sponsor fair market value shall mean the average reported closing price of the Class A ordinary shares for the 10 trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent. The reason that we have agreed that these warrants will be exercisable on a cashless basis so long as they are held by the sponsor or its permitted transferees is because it is not known at this time whether they will be affiliated with us following a business combination. If they remain affiliated with us, their ability to sell our securities in the open market will be significantly limited. We expect to have policies in place that restrict insiders from selling our securities except during specific periods. Proceeds to be held in trust account Of the proceeds we will receive from this offering and the sale of the private placement warrants described in this prospectus, $300,000,000, or $345,000,000 if the underwriters option to purchase additional units is exercised in full ($10.00 per unit in either case), will be deposited into a TABLE OF CONTENTS segregated trust account located in the United States at JP Morgan Chase Bank, N.A. with Continental Stock Transfer & Trust Company acting as trustee and $3,000,000 will be used to pay expenses in connection with the closing of this offering and for working capital following this offering. The proceeds to be placed in the trust account include $10,500,000 (or $12,075,000 if the underwriters option to purchase additional units is exercised in full) in deferred underwriting commissions. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, if any, our amended and restated memorandum and articles of association, as discussed below and subject to the requirements of law and regulation, will provide that the proceeds from this offering and the sale of the private placement warrants held in the trust account will not be released from the trust account (1) to us, until the completion of our initial business combination, and (2) to our public shareholders, until the earliest of (a) the completion of our initial business combination, and then only in connection with those Class A ordinary shares that such shareholders properly elected to redeem, subject to the limitations described herein, (b) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares, and (c) the redemption of our public shares if we have not consummated our business combination within 24 months from the closing of this offering, subject to applicable law. Public shareholders who redeem their Class A ordinary shares in connection with a shareholder vote described in clause (b) in the preceding sentence shall have such shares canceled and therefore will not be entitled to funds from the trust account upon the subsequent completion of an initial business combination or liquidation if we have not consummated an initial business combination within 24 months from the closing of this offering, with respect to such Class A ordinary shares so redeemed. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. Anticipated expenses and funding sources Except as described above with respect to the withdrawal of interest to pay taxes and/or to redeem our public shares in connection with an amendment to our amended and restated memorandum and articles of association, unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. The proceeds held in the trust account will be invested only in U.S. TABLE OF CONTENTS government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. Assuming an interest rate of 0.5% per year, we estimate the interest earned on the trust account will be approximately $1,500,000 per year; however, we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement warrants not held in the trust account, which will be approximately $2,200,000 in working capital after the payment of approximately $800,000 in expenses relating to this offering; and any loans or additional investments from our sponsor or an affiliate of our sponsor or certain of our officers and directors, although they are under no obligation to advance funds to us in such circumstances, and provided any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of our initial business combination. Up to $1,500,000 of such loans may be convertible into warrants of the post-business combination entity at a price of $1.50 per warrant at the option of the lender. Conditions to completing our initial business combination So long as our securities are then listed on the NYSE, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the net assets held in the trust account (net of amounts disbursed to management for working capital purposes and excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of signing a definitive agreement in connection with our initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. Our shareholders may not be provided with a copy of such opinion nor will they be able to rely on such opinion. If our securities are not then listed on NYSE for whatever reason, we would no longer be required to meet the foregoing 80% of net asset test. We will complete our initial business combination only if the post-business combination company in which our public shareholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or is otherwise not required to register as an investment company under the Investment Company Act. Even if the post-business combination company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority TABLE OF CONTENTS interest in the post-business combination company, depending on valuations ascribed to the target and us in the business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-business combination company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test, provided that in the event that the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking shareholder approval, as applicable. Permitted purchases and other transactions with respect to our securities If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, executive officers, advisors or their affiliates may purchase public shares or warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Additionally, at any time at or prior to our initial business combination, subject to applicable securities laws (including with respect to material nonpublic information), our sponsor, directors, executive officers, advisors or their affiliates may enter into transactions with investors and others to provide them with incentives to acquire public shares, vote their public shares in favor of our initial business combination or not redeem their public shares. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds held in the trust account will be used to purchase public shares or warrants in such transactions. If they engage in such transactions, they will be restricted from making any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Securities Exchange Act of 1934, as amended (the Exchange Act ). We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. See Proposed Business Effecting Our Initial Business Combination Permitted Purchases and Other Transactions with Respect to Our Securities for a description of how our sponsor, directors, executive officers, advisors or their affiliates will select which shareholders to purchase securities from in any private transaction. TABLE OF CONTENTS The purpose of any such transaction could be to (1) vote in favor of the business combination and thereby increase the likelihood of obtaining shareholder approval of the business combination, (2) reduce the number of public warrants outstanding or vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination or (3) satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, in cases where, among others, it appears that such requirement would otherwise not be met. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our Class A ordinary shares or public warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Redemption rights for public shareholders upon completion of our initial business combination We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of the initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, if any, divided by the number of then-outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.00 per public share. The per share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. The redemption rights will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Further, we will not proceed with redeeming our public shares, even if a public shareholder has properly elected to redeem its shares, if a business combination does not close. Our initial shareholders have entered into an agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and public shares held by them in connection with (i) the completion of our initial business combination and (ii) a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering or (B) with respect TABLE OF CONTENTS to any other provision relating to the rights of holders of our Class A ordinary shares. Limitations on redemptions Our amended and restated memorandum and articles of association will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001. However, a greater net tangible asset or cash requirement may be contained in the agreement relating to our initial business combination. For example, the proposed business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration we would be required to pay for all Class A ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all Class A ordinary shares submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate business combination. Manner of conducting redemptions We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a general meeting called to approve the business combination or (ii) without a shareholder vote by means of a tender offer. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under applicable law or stock exchange listing requirement. Asset acquisitions and share purchases would not typically require shareholder approval, while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding ordinary shares or seek to amend our amended and restated memorandum and articles of association would typically require shareholder approval. We currently intend to conduct redemptions in connection with a shareholder vote unless shareholder approval is not required by applicable law or stock exchange listing requirement or we choose to conduct redemptions pursuant to the tender offer rules of the SEC for business or other reasons. If we hold a shareholder vote to approve our initial business combination, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A under the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and file proxy materials with the SEC. TABLE OF CONTENTS If we seek shareholder approval, we will complete our initial business combination only if we obtain the approval of an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the company. In such case, our initial shareholders have agreed to vote their founder shares and public shares in favor of our initial business combination. As a result, in addition to our initial shareholders founder shares, we would need 11,250,001, or 37.5% (assuming all issued and outstanding shares are voted and the over-allotment option is not exercised), or 1,875,001, or 6.25% (assuming only the minimum number of shares representing a quorum are voted and the underwriters option to purchase additional units is not exercised), of the 30,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved. However, if our initial business combination is structured as a statutory merger or consolidation with another company under Cayman Islands law, the approval of our initial business combination will require a special resolution passed by the affirmative vote of at least two-thirds of our ordinary shares which are represented in person or by proxy and are voted at a general meeting of the company. Each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction or vote at all. Our amended and restated memorandum and articles of association will require that at least five days notice will be given of any such general meeting. If we conduct redemptions pursuant to the tender offer rules of the SEC, we will, pursuant to our amended and restated memorandum and articles of association: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E under the Exchange Act, which regulate issuer tender offers; and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A under the Exchange Act, which regulates the solicitation of proxies. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we and our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase our Class A ordinary shares in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the TABLE OF CONTENTS Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering more than the number of public shares we are permitted to redeem. If public shareholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete such initial business combination. Limitation on redemption rights of shareholders holding more than 15% of the shares sold in this offering if we hold shareholder vote Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. We believe the restriction described above will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us, our sponsor or our management at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be disbursed directly by the trustee to pay amounts due to any public shareholders who properly exercise their redemption rights as described above adjacent to the caption Redemption rights for public TABLE OF CONTENTS shareholders upon completion of our initial business combination, to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or the redemption of our public shares, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our amended and restated memorandum and articles of association will provide that we will have only 24 months from the closing of this offering to consummate our initial business combination. If we have not consummated an initial business combination within 24 months from the closing of this offering, we will: (i) cease all operations except for the purpose of winding up; (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, if any (less up to $100,000 of interest to pay dissolution expenses), divided by the number of the then-outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidating distributions, if any); and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to consummate an initial business combination within 24 months from the closing of this offering. Our initial shareholders have entered into an agreement with us, pursuant to which they have agreed to waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to consummate an initial business combination within 24 months from the closing of this offering (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). TABLE OF CONTENTS The underwriters have agreed to waive their rights to their deferred underwriting commission held in the trust account in the event we do not consummate an initial business combination within 24 months from the closing of this offering and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. Our sponsor, executive officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares; unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, if any, divided by the number of the then-outstanding public shares, subject to the limitations described above adjacent to the caption Limitations on redemptions. For example, our board of directors may propose such an amendment if it determines that additional time is necessary to complete our initial business combination. In such event, we will conduct a proxy solicitation and distribute proxy materials pursuant to Regulation 14A under the Exchange Act seeking shareholder approval of such proposal and, in connection therewith, provide our public shareholders with the redemption rights described above upon shareholder approval of such amendment. This redemption right shall apply in the event of the approval of any such amendment, whether proposed by our sponsor, any executive officer, director or any other person. Our amended and restated memorandum and articles of association will provide that, if we wind up for any other reason prior to the consummation of our initial business combination, we will follow the foregoing procedures with respect to the liquidation of the trust account as promptly as reasonably possible but not more than ten business days thereafter, subject to applicable Cayman Islands law. Redemption rights for public shareholders upon amendment of our amended and restated memorandum and articles of association If we seek to amend our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares TABLE OF CONTENTS redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares, we will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the approval of such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, if any, divided by the number of then outstanding public shares, subject to the limitations and on the conditions described herein. Limited payments to insiders There will be no finder s fees, reimbursements or cash payments made by the company to our sponsor, officers or directors, or their affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination, other than the following payments, none of which will be made from the proceeds of this offering and the sale of the private placement warrants held in the trust account prior to the completion of our initial business combination: Repayment of up to an aggregate of $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; Reimbursement for office space, secretarial and administrative services provided to us by an affiliate of our sponsor, in the amount of $10,000 per month; Reimbursement for any out-of-pocket expenses related to identifying, investigating, negotiating and completing an initial business combination; and Repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination. Up to $1,500,000 of such loans may be convertible into warrants of the post-business combination entity at a price of $1.50 per warrant at the option of the lender. The warrants would be identical to the private placement warrants. Except for the foregoing, the terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. Any such payments will be made either (i) prior to our initial business combination using proceeds of this offering and the sale of the private placement warrants held outside the trust account or from loans made to us by our sponsor or an affiliate of our sponsor or certain of our officers and directors or (ii) in connection with or after the consummation of our initial business combination. TABLE OF CONTENTS Audit Committee We will establish and maintain an audit committee, which will initially be composed of a majority of independent directors in accordance with NYSE s phase-in rules. Among its responsibilities, the audit committee will review on a quarterly basis all payments that were made by us to our sponsor, officers or directors, or their affiliates and monitor compliance with the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to promptly take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled Management Committees of the Board of Directors Audit Committee. TABLE OF CONTENTS RISKS Summary of Risk Factors An investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together with the other information contained in this prospectus, before making a decision to invest in our units. If any of the following events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. Such risks include, but are not limited to: We are a recently incorporated exempted company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. Past performance by our management team or their respective affiliates may not be indicative of future performance of an investment in us. Our shareholders may not be afforded an opportunity to vote on our proposed initial business combination, which means we may complete our initial business combination even though a majority of our shareholders do not support such a combination. Your only opportunity to affect the investment decision regarding a potential business combination may be limited to the exercise of your right to redeem your shares from us for cash. If we seek shareholder approval of our initial business combination, our initial shareholders have agreed to vote in favor of such initial business combination, regardless of how our public shareholders vote. The ability of our public shareholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combination with a target. The ability of our public shareholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure. The ability of our public shareholders to exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares. The requirement that we consummate an initial business combination within 24 months after the closing of this offering may give potential target businesses leverage over us in negotiating a business combination and may limit the time we have in which to conduct due diligence on potential business combination targets, in particular as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our shareholders. Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the coronavirus ( COVID-19 ) outbreak and the status of debt and equity markets. We may not be able to consummate an initial business combination within 24 months after the closing of this offering, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate. If we seek shareholder approval of our initial business combination, our sponsor, directors, executive officers, advisors and their affiliates may elect to purchase public shares or warrants, which may influence a vote on a proposed business combination and reduce the public float of our Class A ordinary shares or public warrants. Certain of our officers and directors have or will have direct and indirect economic interests in us and/or our sponsor after the consummation of this offering and such interests may potentially conflict with those of our public shareholders as we evaluate and decide whether to recommend a potential business combination to our public shareholders. TABLE OF CONTENTS If a shareholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for tendering its shares, such shares may not be redeemed. You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. Therefore, to liquidate your investment, you may be forced to sell your public shares or warrants, potentially at a loss. NYSE may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities and subject us to additional trading restrictions. The nominal purchase price paid by our sponsor for the founder shares may result in significant dilution to the implied value of your public shares upon the consummation of our initial business combination. The value of the founder shares following completion of our initial business combination is likely to be substantially higher than the nominal price paid for them, even if the trading price of our ordinary at such time is substantially less than $10.00 per share. You will not be entitled to protections normally afforded to investors of many other blank check companies. If we seek shareholder approval of our initial business combination and we do not conduct redemptions pursuant to the tender offer rules, and if you or a group of shareholders are deemed to hold in excess of 15% of our Class A ordinary shares, you will lose the ability to redeem all such shares in excess of 15% of our Class A ordinary shares. Because of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination. If we have not consummated our initial business combination within the required time period, our public shareholders may receive only approximately $10.00 per public share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. If the net proceeds of this offering and the sale of the private placement warrants not being held in the trust account are insufficient to allow us to operate for the 24 months following the closing of this offering, it could limit the amount available to fund our search for a target business or businesses and our ability to complete our initial business combination, and we will depend on loans from our sponsor, its affiliates or members of our management team to fund our search and to complete our initial business combination. The other risks and uncertainties discussed in Risk Factors and elsewhere in this prospectus. TABLE OF CONTENTS
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated certificate of incorporation are to our amended and restated certificate of incorporation to be in effect upon the completion of this offering; common stock are to our Class A common stock and our Class B common stock; company or our company are to Heartland Media Acquisition Corp., a Delaware corporation; founder shares are to shares of our Class B common stock initially purchased by our sponsor in a private placement prior to this offering and the shares of our Class A common stock issued upon the automatic conversion thereof at the time of our initial business combination as provided herein; initial stockholders are to our sponsor and the other holders (if any) of our founder shares prior to this offering; management, our management team or our team are to our officers and directors, and directors are to our current directors and director nominees; private placement warrants are to the warrants to be issued to our sponsor in a private placement simultaneously with the closing of this offering; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our sponsor, officers and directors to the extent our sponsor, officers or directors purchase public shares, provided that each of their status as a public stockholder shall only exist with respect to such public shares; sponsor are to Heartland Sponsor LLC, a Delaware limited liability company, which is an affiliate of Heartland Media LLC; warrants are to our warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and the private placement warrants; and we, us or our are to Heartland Media Acquisition Corp., a Delaware corporation, or, where applicable, members of our management team. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Overview We are a newly formed blank check company, incorporated as a Delaware corporation and created for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. We have not selected any potential business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with respect to a potential business combination target. While we may pursue an acquisition opportunity in any business, industry, sector or geographical location, we intend to focus our search on the media, entertainment and sports sectors. Our management team and Board of Directors (our Board ) has had significant success sourcing, acquiring, growing and monetizing companies across these sectors. We have particular expertise in television broadcasting, and in local media generally. We believe this experience makes us well suited to identify, source, negotiate and execute an initial business combination with the ultimate goal of pursuing attractive risk-adjusted returns for our stakeholders. TABLE OF CONTENTS The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities, and it is not soliciting an offer to buy these securities, in any jurisdiction where the offer or sale is not permitted. Subject to Completion, dated January 18, 2022 PRELIMINARY PROSPECTUS $175,000,000 HEARTLAND MEDIA ACQUISITION CORP. 17,500,000 Units Heartland Media Acquisition Corp. is a newly formed blank check company incorporated as a Delaware corporation and created for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination, which we refer to throughout this prospectus as our initial business combination, with one or more businesses or entities, which we refer to throughout this prospectus as a target business. We have not selected any specific target business and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any target business regarding a business combination with our company. While we may pursue an acquisition opportunity in any business, industry, sector or geographical location, we intend to focus on the media, entertainment and sports sectors. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one share of our Class A common stock and one-half of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as described herein. Only whole warrants are exercisable. The warrants will become exercisable on the later of 30 days after the completion of our initial business combination and 12 months from the closing of this offering, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Subject to the terms and conditions described in this prospectus, we may redeem the warrants once the warrants become exercisable. We have also granted the underwriters a 45-day option from the date of this prospectus to purchase up to an additional 2,625,000 units to cover over-allotments, if any. We will provide our public stockholders with the opportunity to redeem all or a portion of their shares of our Class A common stock upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account (net of taxes payable), divided by the number of then outstanding shares of Class A common stock that were sold as part of the units in this offering, which we refer to collectively as our public shares throughout this prospectus, subject to the limitations described herein. If we have not completed our initial business combination within 18 months from the closing of this offering (or up to 21 months from the closing of this offering if, subject to certain conditions, we extend the period of time to consummate a business combination as described in more detail in this prospectus), we will redeem 100% of the public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (net of taxes payable and less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions as further described herein. In connection with an extension of the period of time we will have to complete an initial business combination from 18 months to up to 21 months, our public stockholders will not be entitled to vote or to redeem their shares. This feature is different than most other special purpose acquisition companies. Our sponsor has agreed to purchase an aggregate of 9,875,000 warrants (or 11,056,250 warrants if the underwriters over-allotment option is exercised in full) at a price of $1.00 per warrant ($9,875,000 in the aggregate, or $11,056,250 in the aggregate if the underwriters over-allotment option is exercised in full), each exercisable to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment, in a private placement that will close simultaneously with the closing of this offering. A portion of the proceeds from the sale of these warrants will be placed in the trust account described below. Our initial stockholders, which include our sponsor, own 5,031,250, subject to adjustment, shares of Class B common stock (up to 656,250 of which are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised). The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of our initial business combination on a one-for-one basis, subject to adjustment as described herein. Only holders of Class B common stock will have the right to vote on the election of directors and to remove directors prior to our initial business combination, and such rights may only be amended by a resolution passed by the holders of a majority of our Class B common stock. On all other matters submitted to a vote of our stockholders, holders of the Class B common stock and holders of the Class A common stock will vote together as a single class, with each share of common stock entitling the holder to one vote, except as required by law or the applicable rules of the New York Stock Exchange, or the NYSE, then in effect. Prior to this offering, there has been no public market for our units, Class A common stock or warrants. We have been approved to list our units on the NYSE under the symbol HMA.U. We expect our units will be listed on the NYSE on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on the NYSE. We expect the Class A common stock and warrants constituting the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless BofA Securities, Inc. and Moelis & Company LLC inform us of their decision to allow earlier separate trading, subject to our satisfaction of certain conditions. Once the securities constituting the units begin separate trading, we expect that the Class A common stock and warrants will be listed on the NYSE under the symbols HMA and HMA.WS, respectively. We are an emerging growth company and smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves risks. See Risk Factors beginning on page 39 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Per Unit Total Public offering price $10.00 $175,000,000 Underwriting discounts and commissions(1) $0.55 $ 9,625,000 Proceeds, before expenses, to us $9.45 $165,375,000 (1) Includes $0.35 per unit, or $6,125,000 (or up to $7,043,750 if the underwriters over-allotment option is exercised in full) in the aggregate, payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein. The deferred underwriting commissions will be released to the underwriters only upon completion of our initial business combination. Does not include certain fees and expenses payable to the underwriters in connection with this offering. See Underwriting for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $179,375,000, or $206,281,250 if the underwriters over-allotment option is exercised in full ($10.25 per unit in either case), will be deposited into a U.S.-based trust account with Continental Stock Transfer & Trust Company acting as trustee and Bank of America Merrill Lynch, BofA Securities, Inc. acting as investment manager, and $2,000,000 will be available to pay fees and expenses in connection with this offering and for working capital following this offering. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units on or about , 2022. Joint bookrunning managers BofA Securities Moelis & Company Prospectus dated , 2022 TABLE OF CONTENTS Management Team, Sponsor and Board of Directors We believe our management team and Board is well positioned to identify and evaluate businesses within the media, entertainment and sports industries that would benefit from being a public company and from access to our expertise. Our team has extensive experience in the industry and has a broad network of contacts in these sectors which can help identify potential opportunities. Mr. Robert S. Prather Jr., Chief Executive Officer, has extensive experience in the media, entertainment and sports industry. Mr. Prather and a partner acquired control of Gray Communications Systems, Inc. ( Gray ), a public company, in late 1993. During his tenure, he helped grow the market capitalization of Gray from approximately $52 million to more than $400 million. He was instrumental in increasing Gray s EBITDA from approximately $6 million at the beginning of his tenure to approximately $176 million during his final full year, representing a CAGR of approximately 20%. Through strategic and transformative acquisitions, Mr. Prather helped Gray increase the number of television stations it owned from three to 30, as well as increase the number of newspapers owned from one to five. Mr. Prather anticipated the eventual decline of the newspaper industry, and in December 2005 Gray spun off five newspapers and one wireless business to a separate public company. Gray operated 22 number one ranked television stations and stations in 17 college towns and eight state capitals. Mr. Prather also served as CEO and a Director of Bull Run Corporation ( Bull Run ), a sports and affinity marketing management company, from 1992 until its merger into Triple Crown Media, Inc in December 2005. During his time at Gray, Mr. Prather and his partner also acquired Host Communications, a college sports marketing business which became a wholly owned subsidiary of Bull Run. Host Communications provided sports marketing and productions services to a number of collegiate conferences and universities. After successfully growing Host Communications, the business was sold in 2007 to IMG, led by Ted Forstmann, for $74 million. Following his tenure at Gray, Mr. Prather formed Heartland Media LLC ( Heartland Media ) in 2013 and partnered with MSouth Equity Partners to help grow the business. Under Mr. Prather s leadership, Heartland Media acquired its first television station in 2013, and from 2014 to 2017 it acquired 10 additional television stations for total consideration of $220 million. Mr. Prather grew Heartland Media s cash flow to approximately $29 million in 2019. Mr. Prather led the sale of 11 television stations by Heartland Media in February 2020 for $305 million cash. Since 2004, Mr. Prather has served on the board of GAMCO Investors, Inc. (NYSE: GBL) where he is the Lead Independent Director. He has also served on the board of Ryman Hospitality Properties, Inc. (NYSE: RHP), formerly known as Gaylord Entertainment Company, since 2009. Ryman Hospitality Properties, Inc. is a REIT which specializes in group-oriented, destination hotel assets in urban and resort markets. Ryman Hospitality Properties also owns the Opry Entertainment Group. Previously, Mr. Prather served as a director of Diebold-Nixdorf, Inc. (NYSE: DBD) from April 2013 to April 2018. In 2015, Mr. Prather was actively involved as a board member in Diebold s $1.9 billion acquisition of Wincor Nixdorf AG, a German automated teller machine ( ATM ) maker and financial technology company, which combined the second and third largest ATM / financial technology companies in the world. Mr. Prather was previously the largest shareholder of Rawlings Sporting Goods Company, Inc. (formerly NASDAQ: RAWL), where he served as Vice-Chairman from 1998 to 2001. He was instrumental in selling Rawlings to K2 Inc. for a 48% premium to the unaffected share price. Mr. Prather was on the Board of Directors and an Advisory Board member for Swiss Army Brands, Inc. (formerly NASDAQ: SABI) from 1995 to 2011. Mr. Prather received an undergraduate and graduate degree from the Georgia Institute of Technology. Our Sponsor Heartland Sponsor LLC, our sponsor, is an affiliate of Heartland Media. Heartland Media is a television broadcasting company formed in 2013. Heartland Media made its first television station acquisition in 2014 and from 2014 to 2017 it acquired 10 additional television stations for total consideration of $220 million. In February 2020, Heartland Media sold nine television stations to Allen Media Broadcasting for $305 million cash. Heartland Media currently owns two television stations, KQTV, an ABC affiliate in Saint Joseph, Missouri, and WKTV, a NBC affiliate in Utica, New York. Mr. Prather, our Chief Executive Officer, is the founder and majority owner of Heartland Media. Mr. Muoio, one of our directors, holds a minority interest in Heartland Media LLC. TABLE OF CONTENTS Our Directors Salvatore Muoio, CFA, is the founder of S Muoio & Co. LLC and the manager of several related investment partnerships. Mr. Muoio has significant experience in the public markets and has been involved in the securities industry since 1985. Prior to establishing SM Investors, L.P. in 1997, Mr. Muoio served in the equity markets group of Lazard Fr res & Co. LLC from 1995 to 1996 as Director of Equity Research and as an equity analyst concentrating in telecommunications and media industries. Mr. Muoio started his career at Gabelli Funds, Inc. from 1985 to 1995 where he served in several capacities, including as a securities analyst for Gabelli & Company, Inc., Director of Research for GAMCO Investors, and as Portfolio Manager for the Gabelli Global Telecommunications Fund, Inc. Mr. Muoio also serves on the Board of Directors of LICT Corporation and CIBL, Inc., which are diversified publicly traded holding companies involved in various telecommunications, media, and service businesses. Mr. Muoio closely follows companies in the media, entertainment and sports industries which will be helpful in sourcing a potential business combination. Mr. Muoio is a member of the Institute of Chartered Financial Analysts, as well as the New York Society of Securities Analysts. Mr. Muoio received a B.B.A. with a major in finance from the University of Notre Dame in 1981 and an M.B.A. with a concentration in Finance from Notre Dame in 1985. Steven T. Shapiro is a founding partner of GoldenTree Asset Management and sits on GoldenTree s Executive Committee. For many years, he was responsible for the firm s investments in media and communications as well its investments in distressed assets. Started in 2000, GoldenTree currently has approximately $40 billion under management and is based in New York, with offices in West Palm Beach, London, Singapore, Sydney, Tokyo and Dublin. Under Mr. Shapiro s guidance, GoldenTree made numerous successful investments totaling several billions dollars in sectors including broadcasting, outdoor, entertainment, publishing, cable and telecom. Mr. Shapiro was a Managing Director in the High Yield Group at CIBC World Markets, where he headed Media and Telecommunications Research. While at CIBC, Mr. Shapiro was involved in several billions dollars of equity and debt financings for media and communications companies. Prior to its acquisition by CIBC in 1995, Mr. Shapiro was a research analyst with The Argosy Group, a high yield investment-banking boutique in New York. Before joining Argosy, Mr. Shapiro was a bankruptcy attorney with Stroock & Stroock & Lavan in New York. Mr. Shapiro s extensive experience will be invaluable in helping assess and evaluate potential business combinations. Mr. Shapiro has served on numerous corporate and not-for-profit boards. He is currently a member of the Board of Overseers of the University of Pennsylvania Law School, and is a member of the Executive Committee of the Board of Trustees of the Abraham Joshua Heschel School in New York. Mr. Shapiro is a graduate of The University of Pennsylvania Law School, where he served as Senior Editor of the Labor Law Journal. He graduated with Honors from the University of Pennsylvania College of Arts & Sciences with a major in modern diplomatic history and was a member of the History Honor Society. Alan J. Weber is the Chief Executive Office of Weber Group LLC, focusing on investments in the Financial Services and Technology Services industries/sectors. He has vast experience as a senior executive at financial companies, including large publicly traded companies such as Citibank and Aetna, Inc. Mr. Weber is the former Chairman and CEO of U.S. Trust Co., a 160 year-old firm specializing in trust, investment management, tax and estate planning and private banking. Prior to joining U.S. Trust in October 2002, Mr. Weber was Vice Chairman and Chief Financial Officer at Aetna, Inc., where he was responsible for corporate strategy, capital management, information technology, investor relations and financial operations. The cornerstone of Mr. Weber s career was built at Citicorp, where he worked from 1971 to 1998, holding senior positions in corporate banking, consumer banking and corporate operations/technology. Mr. Weber was Chairman of Citibank International and an Executive Vice President of Citibank. Mr. Weber is currently a director of Broadridge Financial Solutions, Inc., a global provider of investor communications, securities processing, wealth management services and outsourcing solutions to the financial services industry. Mr. Weber is a director of Street Diligence, Inc., a fintech services business. From 2008 until 2018, he was the Chairman of KGS-Alpha Capital Markets, a fixed income broker-dealer. Previously, Mr. Weber was a director of Diebold-Nixdorf, Inc., and Sandridge Energy, Inc., (NYSE: SD), an oil and gas exploration company. Mr. Weber received his B.S. in Economics from the Wharton School at the University of Pennsylvania and an MBA from the Kellogg School at Northwestern University. John Zieser is a senior media executive with a unique and long-established record of success in business development and deal-making, business operations and acquisition integration, and finance, audit, and corporate governance. Mr. Zieser served as Chief Development Officer and General Counsel for Meredith Corporation (NYSE: MDP), one of the nation s leading multi-platform media and marketing services companies. He was TABLE OF CONTENTS responsible for managing the company's business development functions and oversaw company-wide legal affairs, corporate privacy, and government relations. Mr. Zieser played a key role in the transformation of Meredith s businesses through multiple expansion initiatives in the media, digital, consumer revenue and licensing sectors. During his time at Meredith, Mr. Zieser was directly involved in over 300 transactions many of which were mid-stage digital, consumer revenue and marketing services and media businesses, combined with larger disruptive and synergistic transactions of traditional media businesses, all aggregating to approximately $16 billion in transaction value. Mr. Zieser played a critical role in Meredith selling their television business to Gray Television for $2.8bn followed by the sale of the remaining Meredith business to IAC for $2.7bn. Other select transactions which Mr. Zieser was instrumental for Meredith, include its $2.8bn acquisition of Time Inc. and several local TV station acquisitions for purchase prices in aggregate of over $680mm. As part of the integration of Time, Mr. Zieser led a rigorous strategic portfolio review of the combined Meredith / Time businesses. This review resulted in Mr. Zieser leading an aggressive series of unique and bespoke sales processes of non-core business, which generated over $1 billion of net sales proceeds. Between 2018 and 2021, this process included high profile sports brands such as Sports Illustrated (SI.com), Golf (golf.com) and FanSided, as well as over-the-top (OTT) platform XUMO. While at Meredith, he was instrumental in forging major strategic partnership transactions with market leading companies such as Apple, Walmart and Wyndham. Mr. Zieser s relationships and deep M&A diligence experience will be invaluable in helping evaluate potential business combinations. Prior to joining Meredith, Mr. Zieser was Group President at First Data Merchant Services, an $800 million subsidiary of First Data Corporation. Prior to First Data, he was with the multi-national law firm of Sullivan & Cromwell where he specialized in U.S. and international mergers, acquisitions, venture capital and private equity transactions. Mr. Zieser earned his law degree from Cornell University, graduating Magna Cum Laude, and served as Senior Editor on the Cornell Law Review. Mr. Zieser earned both his MBA and BBA degrees with Beta Gamma Sigma honors from the University of Iowa. With respect to the foregoing examples, past performance of our management team and Board and their collective affiliates is not a guarantee either (i) of success with respect to any business combination we may consummate, or (ii) that we will be able to identify a suitable candidate for our initial business combination. You should not rely on the historical performance record of our management team, our Board or their affiliates as indicative of our future performance. In addition, for a list of entities to which our officers and director nominees currently have fiduciary or contractual obligations that may present a conflict of interest, please refer to the table and subsequent explanatory paragraph under Management Conflicts of Interest. Market Overview We plan to pursue business combination opportunities with companies operating in the media, entertainment and sports industries or adjacent sectors. We have particular expertise in television broadcasting, and in local media generally. The media, entertainment and sports industries are in the midst of an unprecedented level of disruption, initially caused by a shift in the media landscape and then further amplified by the COVID-19 pandemic. This has resulted in a significant number of companies that would benefit from access to public markets and capital to grow in the current environment. Additionally, with our management team and Board s expertise in these sectors, we are well positioned to help companies thrive against the current backdrop. Our management team and Board have a long history of overseeing and growing market leading media companies in the sectors we are targeting. We believe that our experience, leadership and industry expertise can help stockholders generate excess returns. TABLE OF CONTENTS The media, entertainment and sports landscape continue to shift dramatically. This shift is resulting in the disruption of traditional business models and many companies are needing to refine their business plan in order to best serve their customers. The introduction of emerging technologies is creating further dislocation and leading to a shift in how consumers engage with media platforms. The dynamic change in these industries is resulting in tremendous opportunity for growth and disruption of more traditional businesses. Certain factors contributing to this shifting landscape which have helped create opportunities include: Increased bifurcation between local advertising and national advertising Rise of OTT platforms which are competing for increased market share Proliferation of original media content Shift of advertising revenue from traditional media to digital media platforms Widespread and continued legalization of sports betting Increased use of data and analytics within sports We believe there are many potential targets within the media, entertainment and sports industries that could become attractive public companies. These potential targets exhibit a broad range of business models and financial characteristics that range from very mature businesses with established franchises, recurring revenues and strong cash flow to high growth innovative companies. We are not, however, required to complete our initial business combination with a media, entertainment or sports business and, as a result, we may pursue a business combination outside of those industries. Business Strategy Our management team and Board s strategy is to create value for our stockholders and generate attractive returns by identifying investment opportunities that could benefit from additional capital, management expertise and operational excellence. We believe our highly experienced team provides us with a distinct advantage to identify a leading media, entertainment or sports company and execute a successful business combination. With significant experience in the media industry, as well as a long history of structuring and executing value creating strategic transactions, our management team and Board are well positioned to identify business combinations. Our management team, led by our Chief Executive Officer, has long-standing relationships with potential sellers in industries we are targeting and collectively has an excellent reputation as a counter party. Our management team and Board also has extensive experience in identifying and executing proprietary strategic investments in the sectors we are targeting. Throughout our CEO s career, he has been involved with a diverse set of transactions, including buy-side, sell-side, carve outs and spin offs. Many of the transactions were privately sourced through key relationships developed over time. Our management team and Board has significant experience in the media, entertainment and sports industries which includes executive positions at Gray, Heartland Media, Host Communications, Bull Run, Rawlings Sporting Goods, Meredith Corporation and others. Our management team has a long history and ability to: Grow businesses through operational efficiencies Identify shifts in consumer behavior Pivot businesses in order to help capture significant shareholder value Develop and execute complex legal and financial structures to support publically traded companies We intend to leverage the management team s and Board s unique and vast experience in: Sourcing acquisition opportunities which help generate excess shareholder value Executing strategic transactions that enhance a company s value proposition Identifying business trends to help drive organic growth Sourcing and leading talented teams to help advance business objectives Navigating the capital markets to help maximize value TABLE OF CONTENTS Upon completion of this offering, members of our management team and Board, as well as our advisors, will communicate with their networks of relationships to articulate the parameters for our search for a target business, and will begin the disciplined process of pursuing and reviewing promising leads. At the time of preparing this prospectus, we have not identified a specific business combination, nor has anyone on our behalf initiated or engaged in any substantive discussions, formal or otherwise, related to such a transaction. Our efforts to date are limited to organizational activities related to this offering. Business Combination Criteria Consistent with our business strategy, we have developed the following general criteria that we believe are important in evaluating prospective initial business combinations. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. We intend to evaluate opportunities using the following attributes as a guide: Generates stable revenue and cash flows or potential for significant revenue and earnings growth Defensible market position Potential for additional synergistic M&A activity Strong management team that would benefit from our extensive and diverse expertise Ability to benefit from being a publicly traded company with access to the broader capital markets Valuation which is in line with the business fundamentals These criteria and guidelines are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general criteria and guidelines as well as other considerations, factors, criteria and guidelines that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria and guidelines in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC. We may need to obtain additional financing either to complete our initial business combination or because we become obligated to redeem a significant number of our public shares upon completion of our initial business combination. We intend to acquire a company with an enterprise value significantly above the net proceeds of this offering and the sale of the private placement warrants. Our Acquisition Process In evaluating a prospective target business for our initial business combination, we expect to conduct a thorough due diligence review which may encompass, among other things, meetings with incumbent management, document reviews, as well as a review of financial, operational, legal and other information that will be made available to us. We will also utilize our operational and capital planning experience. We are not prohibited from pursuing an initial business combination with a business that is affiliated with our sponsor, officers or directors, or any of their respective affiliates. In the event we seek to complete our initial business combination with a business that is affiliated with our sponsor, officers or directors, or any of their affiliates, we, or a committee of disinterested directors, will obtain an opinion from an independent investment banking firm which is a member or FINRA or another independent entity that commonly renders valuation opinions that our initial business combination is fair to us from a financial point of view. We do not anticipate being required to obtain such an opinion in any other context, except as discussed below. Members of our management team will directly or indirectly own founder shares and/or private placement warrants following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. In particular, because the founder shares were purchased at approximately $0.003 per share, the holders of our founder shares (including members of our management team that directly or indirectly own founder shares) could make a substantial profit after our initial business combination even if our public stockholders lose money on TABLE OF CONTENTS their investment as a result of a decrease in the post-combination value of their shares of common stock (after accounting for any adjustments in connection with an exchange or other transaction contemplated by the business combination). Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors is included by a target business as a condition to our initial business combination. In addition, each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to another entity pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor these obligations to present such business combination opportunity to such entity, and may determine to only present it to us if such entity rejects the opportunity. We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our business combination. Our amended and restated certificate of incorporation will provide that, prior to the consummation of our initial business combination, we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our Company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue and the director or officer is permitted to refer that opportunity to us without violating any legal obligation. Our officers and directors would continue to be subject to all other fiduciary duties owed to us and our stockholders and no other waivers of their respective fiduciary obligations have been provided to any such officers and directors. We do not have any plan for any waiver of the fiduciary duties of our officers and directors post-business combination. Further, our officers and directors are not required to commit any specified amount of time to our affairs, and, accordingly, will have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. Sourcing of Potential Initial Business Combination Targets Our management team and Board has significant transaction experience which we believe will provide us an advantage while sourcing potential initial business combination targets. Our management team and Board has developed long-standing corporate relationships over their careers and intends to leverage their vast networks during the sourcing phase. Additionally, our management team and Board has gained highly valuable knowledge of the capital markets throughout their time as executives and directors of public companies. Our management team and Board has been instrumental in consummating a significant amount of acquisitions or dispositions, with examples including: Acquisition of Data South Computer Company in 1993 Acquiring control of Gray for $14 million in 1993 Acquisition of two television stations in Lexington, KY from Kentucky Central Television, Inc. for $38 million in 1994 Acquisition of Augusta CBS television station from Television Station Partners for $37 million in 1996 Acquisition of two CBS-affiliated television stations and mobile satellite truck business from First American Media, Inc. for $184 million in 1996 Acquisition of Busse Broadcasting Corporation and two of its television stations and corresponding disposition of a television station in a transaction valued at over $190 million in 1998 Acquisition of 15 television stations from Benedek Broadcasting for $500 million in 2002 Acquisition of one television station from Emmis Communications for $186 million in 2005 Spun off five newspapers and one wireless business resulting in a separate publically traded company and a $40 million dividend to Gray in 2005 TABLE OF CONTENTS Acquisition of one television station from the University of Notre Dame for approximately $85 million Became the largest shareholder of Rawlings Sporting Goods Company, Inc. and named Vice Chairman, which was eventually sold to K2 Inc. for a 48% premium over the public market price Chairman of the Special Committee for the sale of Swiss Army Brands, Inc. to the Swiss Army Corporation in Ibach, Switzerland Formation of Heartland Media in 2013 Acquisition of Wincor Nixdorf AG by Diebold for $1.9 billion in 2015 Acquisition of a television station from GOCOM Media for $40 million in 2015 Acquisition of five television stations from Nexstar Broadcasting Group, Inc. in 2018 for $115 million Acquisition of Time Inc. by Meredith Corporation for $2.8 billion in 2018 Sale of Texture by Meredith Corporation to Apple Inc. in 2018 Acquisition of multiple television stations over a period of time by Meredith Corporation for an aggregate of over $680mm Sale of eleven television stations to Allen Media Group in 2020 for $305 million Initial Business Combination The rules of the NYSE require that our initial business combination must be with one or more target businesses that together have an aggregate fair market value equal to at least 80% of the assets held in the trust account (excluding the amount of deferred underwriting discounts held in trust and taxes payable on the income earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. We refer to this as the 80% of net assets test. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm that is a member of FINRA or from an independent entity that commonly renders valuation opinions, with respect to the satisfaction of such criteria. We do not currently intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination, although there is no assurance that will be the case. Additionally, pursuant to NYSE rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own or acquire shares will own or acquire 100% of the outstanding equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business or businesses in order to meet certain objectives of the target management team or stockholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target business and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target or issue a substantial number of new shares to third-parties in connection with financing our initial business combination. In such cases, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired by us is what will be taken into account for purposes of the 80% of net assets test. If our initial business combination involves more than one target business, the 80% of net assets test will be based on the TABLE OF CONTENTS aggregate value of all of the target businesses (or the portions of such businesses we acquire) and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. Subject to the foregoing, our management will have virtually unrestricted flexibility in identifying and selecting one or more prospective target businesses, although we will not be permitted to effectuate our initial business combination with another blank check company or a similar company with nominal operations. Prior to the date of effectiveness of the registration statement of which this prospectus forms a part, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended (the Exchange Act ). As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. Corporate Information We are a newly formed blank check company incorporated as a Delaware corporation on February 10, 2021. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A common stock that is held by non-affiliates exceeds $700 million as of the end of that fiscal year s second fiscal quarter; and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our Class A common stock held by non-affiliates exceeds $250 million as of the end of that fiscal year s second fiscal quarter, and (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our Class A common stock held by non-affiliates exceeds $700 million as of the end of that fiscal year s second fiscal quarter. Our executive offices are located at 3282 Northside Parkway, Suite 275, Atlanta, GA 30327 and our telephone number is (470) 355-1944. Our website address is www.heartlandmediaacquisition.com. Our website and the information contained on, or that can be accessed through, the website is not deemed to be incorporated by reference in, and is not considered part of, this prospectus or the registration statement of which this prospectus is a part. You should not rely on any such information in making your decision whether to invest in our securities. TABLE OF CONTENTS The Offering In making your decision whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors in this prospectus. Securities offered 17,500,000 units (or 20,125,000 units if the underwriters over-allotment option is exercised in full), at $10.00 per unit, each unit consisting of: one share of Class A common stock; and one-half of one redeemable warrant to purchase one share of Class A common stock. Proposed NYSE symbols Units: HMA.U Class A Common Stock: HMA Warrants: HMA.WS Trading commencement and separation of Class A common stock and warrants The units will begin trading on or promptly after the date of this prospectus. We expect the Class A common stock and warrants constituting the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless BofA Securities, Inc. and Moelis & Company LLC inform us of their decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the shares of Class A common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of Class A common stock and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Additionally, the units will automatically separate into their component parts and will not be traded after completion of our initial business combination. Separate trading of the Class A common stock and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A common stock and warrants be traded separately until we have filed with the SEC a Current Report on Form 8-K which includes an audited balance sheet of the company reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K TABLE OF CONTENTS promptly, and no later than four business days, after the closing of this offering. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. Units: Number outstanding before this offering 0 Number outstanding after this offering 17,500,000(1) Common stock: Number outstanding before this offering 5,031,250(2)(4) Number outstanding after this offering 21,875,000(1)(3)(4) Warrants: Number of private placement warrants to be sold in a private placement simultaneously with this offering 9,875,000(1) Number of warrants to be outstanding after this offering and the private placement 18,625,000(1) Exercisability Each whole warrant offered in this offering is exercisable to purchase one share of our Class A common stock, subject to adjustment as provided herein, and only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We structured each unit to contain one-half of one redeemable warrant, with each whole warrant exercisable for one share of Class A common stock, in order to reduce the dilutive effect of the warrants upon completion of a business combination as compared to units that each contain a whole warrant to purchase one whole share, thus making us, we believe, a more attractive business combination partner for target businesses. Exercise price $11.50 per whole share of Class A common stock, subject to adjustment as described herein. In addition, if (x) we issue additional shares of our Class A common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share of our Class A common stock (with such issue price or effective issue price to be determined in good faith by (1) Assumes no exercise of the underwriters over-allotment option and the corresponding forfeiture by our initial stockholders of 656,250 founder shares. (2) Consists solely of founder shares, and includes up to 656,250 founder shares that are subject to forfeiture by our initial stockholders depending on the extent to which the underwriters over-allotment option is exercised. (3) Includes 17,500,000 public shares and 4,375,000 founder shares. (4) Founder shares are classified as shares of Class B common stock, which shares will automatically convert into shares of Class A common stock at the time of our initial business combination on a one-for-one basis, subject to adjustment as described below adjacent to the caption Founder shares conversion and anti-dilution rights. TABLE OF CONTENTS our board of directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or such affiliates, as applicable, prior to such issuance) (the newly issued price ), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume-weighted average trading price of our Class A common stock during the 20-trading day period starting on the trading day after the day on which we consummate our initial business combination (such price, the market value ) is below $9.20 per share, then the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the market value and the newly issued price, and the $18.00 per share redemption trigger price described below adjacent to Description of Securities Warrants Public Stockholders Warrants Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00 will be adjusted (to the nearest cent) to be equal to 180% of the higher of the market value and the newly issued price, and the $10.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to the higher of the market value and the newly issued price. Exercise period The warrants will become exercisable on the later of: 30 days after the completion of our initial business combination; and 12 months from the closing of this offering; provided in each case that we have an effective registration statement under the Securities Act covering the issuance of the shares of our Class A common stock issuable upon exercise of the warrants and a current prospectus relating to them is available (or holders are permitted to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement) and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder. We are not registering the shares of Class A common stock issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable, but in no event later than 20 business days after the closing of our initial business combination, we will use our commercially reasonable efforts to file with the SEC, and within 60 business days following the closing of our initial business combination to have declared effective, a registration statement covering the TABLE OF CONTENTS issuance of the shares of Class A common stock issuable upon exercise of the warrants, and to maintain the effectiveness of such registration statement and a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed; provided that, if our Class A common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, but we will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. If a registration statement covering the shares of our Class A common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of the initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption. If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a cashless basis. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00 Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the private placement warrants): in whole and not in part; at a price of $0.01 per warrant; on a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period; and if, and only if, the last reported sale price of our Class A common stock for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders (the TABLE OF CONTENTS Reference Value ) equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like and for certain issuances of Class A common stock and equity-linked securities as described above). We will not redeem the warrants as described above unless a registration statement under the Securities Act covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants is then effective and a current prospectus relating to those shares of Class A common stock is available throughout the 30-day redemption period or we require the warrants to be exercised on a cashless basis as described below. If and when the warrants become redeemable by us, we may exercise our redemption right even if the issuance of the underlying securities is not exempt under all applicable state securities laws and we are unable to register or qualify the underlying securities for sale under all such laws. As a result, we may redeem the warrants as set forth above even if the holders are otherwise unable to exercise the warrants. If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In determining whether to require all holders to exercise their warrants on a cashless basis, our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our stockholders of issuing the maximum number of shares of Class A common stock issuable upon the exercise of our warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of Class A common stock equal to the lesser of (A) the quotient obtained by dividing (x) the product of the number of shares of Class A common stock underlying the warrants, multiplied by the excess of the fair market value (defined below) over the exercise price of the warrants by (y) the fair market value and (B) the product of 0.361 and the number of warrants surrendered by such holder, subject to adjustment. The fair market value shall mean the volume-weighted average price of the Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Please see the section entitled Description of Securities Warrants Public Stockholders Warrants for additional information. None of the private placement warrants will be redeemable by us (except as described below adjacent to Description of Securities Warrants Public Stockholders Warrants Redemption of warrants when TABLE OF CONTENTS the price per share of Class A common stock equals or exceeds $10.00 ) so long as they are held by our sponsor or its permitted transferees. Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00 Once the warrants become exercisable, we may redeem the outstanding warrants: in whole and not in part; at $0.10 per warrant upon a minimum of 30 days prior written notice of redemption, provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to the table set forth under Description of Securities Warrants Public Stockholders Warrants based on the redemption date and the fair market value of our Class A common stock (as defined below) except as otherwise described in Description of Securities Warrants Public Stockholders Warrants ; and if, and only if, the Reference Value (as defined above under Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00 ) equals or exceeds $10.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like and for certain issuances of Class A common stock and equity-linked securities as described above); and if, and only if, the Reference Value is less than $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like and for certain issuances of Class A common stock and equity-linked securities as described above), the private placement warrants are also concurrently called for redemption on the same terms as the outstanding public warrants, as described above. We will not redeem the warrants as described above unless a registration statement under the Securities Act covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants is then effective and a current prospectus relating to those shares of Class A common stock is available throughout the 30 day redemption period. If and when the warrants become redeemable by us, we may exercise our redemption right even if the issuance of the underlying securities is not exempt under all TABLE OF CONTENTS applicable state securities laws and we are unable to register or qualify the underlying securities for sale under all such laws. As a result, we may redeem the warrants as set forth above even if the holders are otherwise unable to exercise the warrants. The fair market value of our Class A common stock shall mean the volume-weighted average price of our Class A common stock for the 10 trading days immediately following the date on which the notice of redemption is sent to the holders of warrants. This redemption feature differs from the typical warrant redemption features used in other blank check offerings. We will provide our warrant holders with the final fair market value no later than one business day after the 10-trading day period described above ends. In no event will the warrants be exercisable in connection with this redemption feature for more than 0.361 shares of our Class A common stock per warrant (subject to adjustment). No fractional shares of Class A common stock will be issued upon exercise. If, upon exercise, a holder would be entitled to receive a fractional interest in a share, we will round down to the nearest whole number of the number of shares of Class A common stock to be issued to the holder. Please see the section entitled Description of Securities Warrants Public Stockholders Warrants for additional information. Pursuant to the warrant agreement, references above to Class A common stock shall include a security other than Class A common stock into which the Class A common stock has been converted or exchanged for in the event we are not the surviving company in our initial business combination. Founder shares On March 4, 2021, our sponsor purchased 7,187,500 founder shares for an aggregate purchase price of $25,000, or approximately $0.003 per share. On October 27, 2021, our sponsor surrendered 1,437,500 founder shares for no consideration, resulting in 5,750,000 shares outstanding of which 750,000 were subject to forfeiture in the event the underwriters over-allotment option is not exercised. On January 14, 2022, our sponsor surrendered 718,750 founder shares for no consideration, resulting in 5,031,250 shares outstanding of which 656,250 were subject to forfeiture in the event the underwriters over-allotment option is not exercised. Prior to the initial investment in the company of $25,000 by our sponsor, the company had no assets, tangible or intangible. The per share purchase price of the founder shares was determined by dividing the amount of cash contributed to us by the number of founder shares issued. The number of founder shares issued was based on the expectation that the founder shares would represent TABLE OF CONTENTS 20% of the outstanding shares after this offering. If we increase or decrease the size of the offering pursuant to Rule 462(b) under the Securities Act, we will effect a stock dividend or a share contribution back to capital or other appropriate mechanism, as applicable, with respect to our Class B common stock immediately prior to the consummation of the offering in such amount as to maintain the number of founder shares at 20.0% of our issued and outstanding shares of our common stock upon the consummation of this offering. Our initial stockholders will own 20.0% of our issued and outstanding shares after this offering (assuming they do not purchase any units in this offering). Up to 656,250 founder shares will be subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised. The founder shares are identical to the shares of Class A common stock included in the units being sold in this offering, except that: the founder shares are subject to certain transfer restrictions, as described in more detail below; our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to: (1) waive their redemption rights with respect to their founder shares and any public shares held by them in connection with the completion of our initial business combination; (2) waive their redemption rights with respect to their founder shares and any public shares held by them in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not consummate our initial business combination within 18 months from the closing of this offering or up to 21 months from the closing of this offering at the election of the Company, subject to certain conditions, including the deposit of $1,750,000 (or $0.10 per unit) into the trust account or as a result of a stockholder vote to amend our amended and restated certificate of incorporation (any extended time period beyond the initial 18 month period, an Extension Period ), or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity; and (3) waive their TABLE OF CONTENTS rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to complete our initial business combination within 18 months from the closing of this offering or during any Extension Period (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). If we submit our initial business combination to our public stockholders for a vote, our sponsor, officers and directors have agreed, pursuant to such letter agreement, to vote their founder shares and any public shares they hold in favor of our initial business combination. As a result, in addition to our initial stockholders founder shares, we would need 6,562,501, or 37.5% (assuming all outstanding shares are voted and the over-allotment option is not exercised), or 1,093,751 or 6.25% (assuming only the minimum number of shares representing a quorum are voted and the over-allotment option is not exercised), of the 17,500,000 public shares sold in this offering to be voted in favor of our initial business combination in order to have such initial business combination approved; the founder shares will automatically convert into shares of our Class A common stock at the time of our initial business combination on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described in more detail below; the founder shares are entitled to registration rights; and prior to our initial business combination, only the holders of the founder shares will have the right to vote on the election of directors and to remove directors, and such rights may only be amended by a resolution passed by the holders of a majority of our Class B common stock. Transfer restrictions on founder shares Our initial stockholders have agreed not to transfer, assign or sell any of their founder shares until the earlier to occur of: (A) one year after the completion of our initial business combination; or (B) the date on which we complete a liquidation, merger, capital stock exchange, reorganization or other similar transaction after our initial business combination that results in all of our stockholders having the right to exchange their TABLE OF CONTENTS shares of common stock for cash, securities or other property (except as described herein under Principal Stockholders Transfers of Founder Shares and Private Placement Warrants ). Any permitted transferees would be subject to the same restrictions and other agreements of our initial stockholders with respect to any founder shares. We refer to such transfer restrictions throughout this prospectus as the lock-up. Notwithstanding the foregoing, if the last reported sale price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, the founder shares will be released from the lock-up. Founder shares conversion and anti-dilution rights The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of our initial business combination on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like, and subject to further adjustment, as provided herein. In the case that additional shares of Class A common stock, or equity-linked securities (as described herein), are issued or deemed issued in excess of the amount issued in this offering and related to the closing of our initial business combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the aggregate number of all shares of common stock outstanding upon the completion of this offering, plus the aggregate number of shares of Class A common stock and equity-linked securities issued or deemed issued in connection with our initial business combination (net of the number of shares of Class A common stock redeemed in connection with our initial business combination), excluding any shares or equity-linked securities issued, or to be issued, to any seller in our initial business combination and any private placement warrants issued to our sponsor, an affiliate of our sponsor or any of our officers or director. Election of Directors; Voting Rights Prior to our initial business combination, only holders of our founder shares will have the right to vote on the election of directors. Holders of our public shares will not be entitled to vote on the election of directors TABLE OF CONTENTS during such time. In addition, prior to the completion of an initial business combination, holders of a majority of our founder shares may remove a member of the board of directors for any reason. These provisions of our amended and restated certificate of incorporation may only be amended by a resolution passed by the holders of a majority of our Class B common stock. With respect to any other matter submitted to a vote of our stockholders, including any vote in connection with our initial business combination, except as required by law or the applicable rules of the NYSE then in effect, holders of our founder shares and holders of our public shares will vote together as a single class, with each share entitling the holder to one vote. Our amended and restated certificate of incorporation will provide that our board of directors will be divided into three classes with only one class of directors being elected in each year and each class (except for those directors appointed prior to our first annual meeting of stockholders) serving a three-year term. Private placement warrants Our sponsor has agreed, pursuant to a written agreement, to purchase an aggregate of 9,875,000 (or 11,056,250 if the underwriters over-allotment option is exercised in full) private placement warrants at a price of $1.00 per warrant ($9,875,000 in the aggregate or $11,056,250 in the aggregate if the underwriters over-allotment option is exercised in full) in a private placement that will occur simultaneously with the closing of this offering. Each private placement warrant is exercisable to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment as provided herein. Certain of the proceeds of the purchase price of the private placement warrants will be added to the proceeds from this offering to be held in the trust account such that at the time of closing $179,375,000 ($206,281,250 if the underwriters over-allotment option is exercised in full) will be held in the trust account. If we do not complete our initial business combination within 18 months from the closing of this offering or during any Extension Period, the proceeds of the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares (subject to the requirements of applicable law) and the private placement warrants will expire worthless. The private placement warrants will not be redeemable by us (except as described below under Description of Securities Warrants Public Stockholders Warrants Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00 ) so long as they are held by our sponsor or its permitted transferees. If the private placement warrants are held by holders other than our TABLE OF CONTENTS sponsor or its permitted transferees, the private placement warrants will be redeemable by us and exercisable by the holders on the same basis as the warrants included in the units being sold in this offering. Our sponsor, as well as its permitted transferees, have the option to exercise the private placement warrants on a cashless basis. Transfer restrictions on private placement warrants The private placement warrants (including the Class A common stock issuable upon exercise of the private placement warrants) will not be transferable, assignable or salable until 30 days after the completion of our initial business combination (except as described herein under Principal Stockholders Transfers of Founder Shares and Private Placement Warrants ). Proceeds to be held in trust account The rules of the NYSE provide that at least 90% of the gross proceeds from this offering and the sale of the private placement warrants be deposited in a trust account. Of the proceeds we will receive from this offering and the sale of the private placement warrants described in this prospectus, $179,375,000 ($10.25 per unit), or $206,281,250 ($10.25 per unit) if the underwriters over-allotment option is exercised in full (including $6,125,000 (or up to $7,043,750 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions), will be deposited into a U.S.-based trust account with Continental Stock Transfer & Trust Company acting as trustee and Bank of America Merrill Lynch, BofA Securities, Inc. acting as investment manager, and $2,000,000 will be used to pay expenses in connection with this offering and for working capital following this offering. The funds in the trust account will be invested only in specified U.S. government treasury bills or in specified money market funds. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay taxes, the funds held in the trust account will not be released from the trust account until the earliest to occur of: (1) the completion of our initial business combination; (2) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering or during any Extension Period or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity; and (3) the redemption of all of our public shares if we have not completed our initial business combination within 18 months from the closing of this TABLE OF CONTENTS offering or during any Extension Period, subject to applicable law. Public stockholders who do not exercise their redemption rights in connection with such an amendment to our certificate of incorporation would still have the right to redeem their shares of Class A common stock in connection with any other applicable amendment to our certificate of incorporation and a subsequent business combination to the extent they are then stockholders. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. Anticipated expenses and funding sources Except as described above with respect to the payment of taxes, unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. The proceeds held in the trust account will be invested only in U.S. government securities with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. We will disclose in each quarterly and annual report filed with the SEC prior to our initial business combination whether the proceeds deposited in the trust account are invested in U.S. government treasury obligations or money market funds or a combination thereof. Based upon current interest rates, we expect the trust account to generate approximately $35,875 of interest annually (assuming an interest rate of 0.02% per year) however, we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement warrants not held in the trust account, which will be approximately $1,200,000 in working capital after the payment of approximately $800,000 in expenses relating to this offering; with respect to our taxes, any interest earned from the trust account; and any loans or additional investments from our sponsor, members of our management team or any of their affiliates or other third parties, although they are under no obligation to loan funds to, or invest in, us, and provided that any such loans will not have any claim on the proceeds held in the trust account. If we complete our initial business combination, we expect to repay such loaned amounts out of the proceeds of the trust account released to us. Otherwise, such loans may be repaid only out of funds held outside the trust account. TABLE OF CONTENTS Up to $1,500,000 of all loans made to us may be convertible into warrants of the post-business combination entity at a price of $1.00 per warrant at the option of the lender at the time of the business combination. The warrants would be identical to the private placement warrants issued to the initial stockholders. Right to extend period to complete initial business combination We will initially have until 18 months from the closing of this offering to complete our initial business combination. However, if we anticipate that we may not be able to complete our initial business combination within 18 months, we may, by resolution of our board of directors, extend the period of time we will have to complete an initial business combination by an additional three months, subject to the deposit of $1,750,000 (or $0.10 per unit) into the trust account. Our public stockholders will not be entitled to vote on, or redeem their shares in connection with, any such extension. Our sponsor may elect, but is not required, to lend such amount to us. In addition, our sponsor may have a conflict of interest in determining if and when to make such loan to us. In the event we complete our initial business combination, the loan would be repaid out of funds released to us from the trust account. If we do not complete a business combination, the loan would not be repaid. This feature is different than most other special purpose acquisition companies, in which any extension of the company s period to consummate an initial business combination would require a vote of the company s public stockholders and in connection with such vote, public stockholders would have the right to redeem their public shares. Conditions to completing our initial business combination There is no limitation on our ability to raise funds privately or through loans in connection with our initial business combination. The rules of the NYSE require that our initial business combination must be with one or more target businesses that together have an aggregate fair market value equal to at least 80% of the value of the assets held in the trust account (excluding the amount of deferred underwriting commissions held in trust and taxes payable on the income earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm that is a member of FINRA or from an independent entity that commonly renders valuation opinions. We will TABLE OF CONTENTS complete our initial business combination only if the post-transaction company in which our public stockholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our initial business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test; provided that in the event that our initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. Permitted purchases of public shares and public warrants by our affiliates If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our initial stockholders, directors, officers, advisors or any of their affiliates may purchase public shares or public warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Please see Proposed Business Permitted Purchases of Our Securities for a description of how such persons will determine from which stockholders to seek to acquire securities. There is no limit on the number of public shares such persons may purchase, or any restriction on the price that they may pay. Any such price per public share may be different than the amount per public share a public stockholder would receive if it elected to redeem its public shares in connection with our initial business combination. However, such persons have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. In the event our initial stockholders, directors, officers, advisors or any of their affiliates determine to make any such purchases at the time of a stockholder vote relating to our initial business combination, such purchases could have the effect of TABLE OF CONTENTS influencing the vote necessary to approve such transaction. None of the funds in the trust account will be used to purchase public shares or public warrants in such transactions. If they engage in such transactions, they will be restricted from making any such purchases when they are in possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. Subsequent to the consummation of this offering, we will adopt an insider trading policy which will require insiders to: (1) refrain from purchasing securities during certain blackout periods and when they are in possession of any material non-public information; and (2) clear all trades with our legal counsel prior to execution. We cannot currently determine whether our insiders will make such purchases pursuant to a Rule 10b5-1 plan, as it will be dependent upon several factors, including but not limited to, the timing and size of such purchases. Depending on such circumstances, our insiders may either make such purchases pursuant to a Rule 10b5-1 plan or determine that such a plan is not necessary. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will be required to comply with such rules. Our sponsor, directors, officers, advisors or any of their affiliates will be restricted from making any purchases if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. We would expect any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. None of the funds held in the trust account will be used to purchase shares or public warrants in such transactions prior to completion of our initial business combination. See Proposed Business Permitted Purchases of Our Securities for a description of how our sponsor, initial stockholders, directors, officers, advisors or any of their affiliates will select which stockholders to purchase securities from in any private transaction. The purpose of any such purchases of shares could be to vote such shares in favor of the initial business combination and thereby increase the likelihood of obtaining stockholder approval of the initial business combination or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it TABLE OF CONTENTS appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our shares of Class A common stock or warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Redemption rights for public stockholders upon completion of our initial business combination We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account (net of taxes payable), divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.25 per public share. The redemption rights will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. The per share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares and any public shares held by them in connection with the completion of our initial business combination. Manner of conducting redemptions We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either: (1) in connection with a stockholder meeting called to approve the initial business combination; or (2) by means of a tender offer. The decision as to whether we will seek stockholder approval of a proposed initial business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction TABLE OF CONTENTS and whether the terms of the transaction would require us to seek stockholder approval under applicable law or stock exchange listing requirement. Asset acquisitions and stock purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding common stock or seek to amend our amended and restated certificate of incorporation would typically require stockholder approval. We intend to conduct redemptions without a stockholder vote pursuant to the tender offer rules of the SEC unless stockholder approval is required by applicable law or stock exchange rules or we choose to seek stockholder approval for business or other reasons. If a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other reasons, we will, pursuant to our amended and restated certificate of incorporation: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Such provisions may be amended if approved by holders of 65% of our common stock entitled to vote thereon. Whether or not we maintain our registration under the Exchange Act or our listing on the NYSE, we will provide our public stockholders with the opportunity to redeem their public shares by one of the two methods listed above. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we and our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase shares of our Class A common stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public stockholders not tendering more than a TABLE OF CONTENTS specified number of public shares, which number will be based on the requirement that we will only redeem public shares so long as (after such redemptions) our net tangible assets will be at least $5,000,001, either prior to or upon consummation of an initial business combination, after payment of the deferred underwriting commission (so that we do not then become subject to the SEC s penny stock rules), or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete such initial business combination, and we instead may search for an alternate business combination. If, however, stockholder approval of the transaction is required by applicable law or stock exchange rules or we decide to obtain stockholder approval for business or other reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and file proxy materials with the SEC. We expect that a final proxy statement would be mailed to public stockholders at least 10 days prior to the stockholder vote. However, we expect that a draft proxy statement would be made available to such stockholders well in advance of such time, providing additional notice of redemption if we conduct redemptions in conjunction with a proxy solicitation. Although we are not required to do so, we currently intend to comply with the substantive and procedural requirements of Regulation 14A in connection with any stockholder vote even if we are not able to maintain our NYSE listing or Exchange Act registration. If we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the business combination. In such case, pursuant to the terms of a letter agreement entered into with us, our sponsor, officers and directors have agreed (and their permitted transferees will agree) to vote their founder shares and any public shares held by them in favor of our initial business combination. We expect that at the time of any stockholder vote relating to our initial business combination, our initial stockholders and their permitted transferees will own at least 20% of our outstanding shares of common stock entitled to vote thereon. These voting thresholds, and the voting agreements of our initial stockholders, TABLE OF CONTENTS may make it more likely that we will consummate our initial business combination. Each public stockholder may elect to redeem its public shares without voting, and if it does vote, irrespective of whether it votes for or against the proposed transaction. Our amended and restated certificate of incorporation will provide that we will only redeem our public shares so long as (after such redemptions) our net tangible assets will be at least $5,000,001 either prior to or upon consummation of an initial business combination, after payment of the deferred underwriting commission (so that we do not then become subject to the SEC s penny stock rules). Redemptions of our public shares may also be subject to a higher net tangible asset test or cash requirement pursuant to an agreement relating to our initial business combination. For example, the proposed business combination may require: (1) cash consideration to be paid to the target or its owners; (2) cash to be transferred to the target for working capital or other general corporate purposes; or (3) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration we would be required to pay for all shares of Class A common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all shares of Class A common stock submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate business combination. Tendering stock certificates in connection with a tender offer or redemption rights We may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to either tender their certificates to our transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up to two business days prior to the scheduled vote on the proposal to approve our initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically using The Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option, rather than simply voting against the initial business combination. The tender offer or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are TABLE OF CONTENTS requiring public stockholders to satisfy such delivery requirements, which will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. Limitation on redemption rights of stockholders holding more than 15% of the shares sold in this offering if we hold stockholder vote Notwithstanding the foregoing redemption rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. We believe the restriction described above will discourage stockholders from accumulating large blocks of shares and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our sponsor or its affiliates to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public stockholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us or our sponsor or its affiliates at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders ability to vote all of their shares (including all shares held by those stockholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Redemption rights in connection with proposed amendments to our amended and restated certificate of incorporation Some other blank check companies have a provision in their charter which prohibits the amendment of certain charter provisions. Our amended and restated certificate of incorporation will provide that any of its provisions related to pre-business combination activity (including the requirement to deposit proceeds of this TABLE OF CONTENTS offering and the sale of the private placement warrants into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein) may be amended if approved by holders of at least 65% of our common stock entitled to vote thereon, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of at least 65% of our common stock. The provisions of our amended and restated certificate of incorporation related to the right to vote on the election of directors or to remove a member of our board of directors, in each case prior to our initial business combination, may only be amended by a resolution passed by the holders of a majority of our Class B common stock. In all other instances, our amended and restated certificate of incorporation will provide that it may be amended by holders of a majority of our common stock, subject to applicable provisions of the Delaware General Corporation Law, or DGCL, or applicable stock exchange rules. Our initial stockholders, who will beneficially own 20% of our common stock upon the closing of this offering (assuming they do not purchase any units in this offering), may participate in any vote to amend our amended and restated certificate of incorporation and/or trust agreement and will have the discretion to vote in any manner they choose. Our initial stockholders, officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering or any Extension Period or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (net of taxes payable), divided by the number of then outstanding public shares. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares and any public shares held by them in connection with the completion of our initial business combination. TABLE OF CONTENTS Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, all amounts held in the trust account will be disbursed by the trustee or released to us to pay amounts due to any public stockholders who properly exercise their redemption rights as described below under Proposed Business Redemption rights for public stockholders upon completion of our initial business combination, to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or used for redemption of our public shares, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our amended and restated certificate of incorporation will provide that we will have only 18 months from the closing of this offering or up to 21 months from the closing of this offering at the election of the Company, subject to certain conditions, including the deposit of $1,750,000 (or $0.10 per unit) into the trust account, to complete our initial business combination. If we have not completed our initial business combination within such 18-month period or during any Extension Period, we will: (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably possible but not more than 10 business days thereafter, redeem 100% of the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (net of taxes payable and less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any); and (3) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and TABLE OF CONTENTS the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within such time period. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to any founder shares held by them if we fail to complete our initial business combination within 18 months from the closing of this offering or during any Extension Period. However, if our initial stockholders acquire public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted time period. The underwriters have agreed to waive their rights to their deferred underwriting commissions held in the trust account in the event we do not complete our initial business combination within the allotted time frame (including any Extension Period) and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. Our sponsor, officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering or during any Extension Period or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of Class A common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (net of taxes payable and less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares. However, we will only redeem our public shares so long as (after such redemptions) our net tangible assets will be at least $5,000,001 (a) in the case of our initial business combination, either prior to or upon consummation of such initial business combination, after payment of the deferred underwriting commission or (b) in the case of an amendment to our amended and restated certificate of incorporation (i) to modify the substance or timing TABLE OF CONTENTS of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we have not consummated our initial business combination within 18 months from the closing of this offering or any Extension Period or (ii) with respect to any other provision relating to stockholders rights or pre-initial business combination activity, upon such amendment (in each case so that we do not then become subject to the SEC s penny stock rules). If this optional redemption right is being exercised with respect to an excessive number of public shares such that we cannot satisfy the net tangible asset requirement (described above) we would not proceed with the amendment or the related redemption of our public shares. Limited payments to insiders There will be no finder s fees, reimbursements or cash payments made by us to our sponsor, officers or directors, or our or any of their affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination, other than the following payments, none of which will be made from the proceeds of this offering and the sale of the private placement warrants held in the trust account prior to the completion of our initial business combination: repayment of an aggregate of up to $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; reimbursement for office space, administrative and support services provided to us by an affiliate of our sponsor, in the amount of $20,000 per month; reimbursement for any out-of-pocket expenses related to our formation and initial public offering and identifying, investigating, negotiating and completing an initial business combination; and repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to fund working capital deficiencies or finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender. These payments may be funded using the net proceeds of this offering and the sale of the private placement warrants not held in the trust account or, upon TABLE OF CONTENTS completion of the initial business combination, from any amounts remaining from the proceeds of the trust account released to us in connection therewith. Our audit committee will review on a quarterly basis all payments that were made by us to our sponsor, officers or directors, or our or any of their affiliates. Audit committee Prior to the effectiveness of the registration statement of which this prospectus forms a part, we will have established and will maintain an audit committee to, among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to promptly take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled Management Committees of the Board of Directors Audit Committee. Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party (other than our independent registered public accounting firm) for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (1) $10.25 per public share or (2) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes (less up to $100,000 of interest to pay dissolution expenses), except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third-party claims. We have not independently verified whether our sponsor has sufficient funds to satisfy its indemnification obligations. Given that our sponsor s only assets are securities of our Company, our sponsor may not be able to satisfy those indemnification obligations. We have not asked our sponsor to reserve for such obligations. See Risk Factors Our directors may decide not to enforce the indemnification obligations of our sponsor, resulting in a reduction in the amount of funds in the trust account available for distribution to our public stockholders. TABLE OF CONTENTS Summary Financial Data The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. March 4, 2021 September 30, 2021 Balance Sheet Data: Actual Actual As Adjusted Working capital (deficiency)(1) $(6,540) $(249,414) $ 1,223,966 Total assets(2) $56,680 $ 299,206 $180,598,966 Total liabilities(3) $32,540 $ 275,240 $ 18,716,737 Value of shares of common stock subject to possible redemption(4) $ $ $179,375,000 Stockholder s equity (deficit)(5) $24,140 $ 23,966 $ (17,492,771) (1) The as adjusted calculation includes $1,200,000 of cash held outside the trust account, plus $23,966 of actual stockholder s equity on September 30, 2021. (2) The as adjusted calculation equals $179,375,000 of cash held in trust from the proceeds of this offering and the sale of the private placement warrants, plus $1,200,000 in cash held outside the trust account, plus $23,966 of actual stockholder s equity on September 30, 2021. (3) The as adjusted calculation equals $6,125,000 of deferred underwriting commissions, $427,362 of over-allotment liability and $12,164,375 of warrant liability, assuming the underwriter s over-allotment option is not exercised. (4) The as adjusted calculation equals the as adjusted total assets, less the as adjusted total liabilities, less the as adjusted stockholders deficit. (5) Excludes 17,500,000 shares of common stock purchased in the public market which are subject to conversion in connection with our initial business combination. The as adjusted calculation equals the as adjusted total assets, less the as adjusted total liabilities, less the value of shares of common stock that may be converted in connection with our initial business combination ($10.25 per share). If our initial business combination is not completed within 18 months from the closing of this offering or up to 21 months from the closing of this offering at the election of the Company, subject to certain conditions, including the deposit of $1,750,000 (or $0.10 per unit) into the trust account, the proceeds then on deposit in the trust account, including interest earned on the funds held in the trust account (net of taxes payable and less up to $100,000 of interest to pay dissolution expenses), will be used to fund the redemption of our public shares. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within such 18-month time period or during any Extension Period. TABLE OF CONTENTS
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and article of association are to the amended and restated memorandum and articles of association that the company will adopt prior to the consummation of this offering; Companies Act are to the Companies Act (2021 Revision) of the Cayman Islands as the same may be amended from time to time; founder shares are to our Class B ordinary shares initially issued to our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof (for the avoidance of doubt, such Class A ordinary shares will not be public shares ); management or our management team are to our executive officers and directors (including our directors nominees that will become directors in connection with the consummation of this offering); ordinary resolution means a resolution of the company adopted by the affirmative vote of at least a majority of the votes cast by the holders of the issued shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter, or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private placement shares are to the Class A ordinary shares to be issued to our sponsor in a private placement simultaneously with the closing of this offering (which private placement shares are identical to the public shares sold in this offering, subject to certain limited exceptions as described in this prospectus); public shares are to our Class A ordinary shares sold in this offering (whether they are purchased in this offering or thereafter in the open market), but specifically excludes all of our Class A ordinary shares that are issued upon conversion of our Class B ordinary shares; public shareholders are to the holders of our public shares, including our sponsor and management team to the extent our sponsor and/or members of our management team purchase public shares, provided that our sponsor s and each member of our management team s status as a public shareholder will only exist with respect to such public shares; special resolution means a resolution of the company adopted by the affirmative vote of at least a two-thirds (2/3) majority (or such higher threshold as specified in the company s amended and restated articles of association) of votes cast by the holders of the issued shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter, or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter; sponsor are to Vector Acquisition Partners III, L.P., a Cayman Islands exempted limited partnership; and we, us, our, company or our company are to Vector Acquisition Corporation III, a Cayman Islands exempted company. Table of Contents Explanatory Note Vector Acquisition Corporation III is filing this Amendment No. 4 to its registration statement on Form S-1 (File No. 333-254258) (the Registration Statement ) to amend Item 16 of Part II thereof, file certain exhibits thereto and make corresponding updates throughout. Table of Contents Any forfeiture of shares described in this prospectus will take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares, or as otherwise permitted by our amended and restated memorandum and articles of association, as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. General We are a newly organized blank check company incorporated as a Cayman Islands exempted company and formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. To date, our efforts have been limited to organizational activities as well as activities related to this offering. We have not selected any potential business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any potential business combination target. Vector Capital Management, L.P., a technology-focused private investment firm, referred to herein as Vector Capital or Vector, is an affiliate of our sponsor, Vector Acquisition Partners III, L.P. We intend to capitalize on the ability of our management team and the broader Vector Capital platform to identify, acquire, and operate a business in the technology and technology-enabled services sectors that may provide opportunities for attractive long-term risk-adjusted returns, though we reserve the right to pursue an acquisition opportunity in any business or industry. We have generated no operating revenues to date and we do not expect that we will generate operating revenues until we consummate our initial business combination. Vector Capital Vector Capital is a San Francisco-based private equity firm focused on special situations investments in technology and technology-enabled businesses in the middle-market. Founded in 1997, Vector currently oversees $3.5 billion in capital across its private equity and credit strategies and has invested $3.5 billion in more than 50 technology companies since its inception. Throughout its 24 year history, Vector has exclusively focused on investments within the technology sector and has built a successful track record of executing public buyouts, acquisitions of private and venture-backed companies, corporate spin-outs and divestitures, credit recapitalizations and restructurings, minority investments in bootstrapped companies, and private investments in public equity. Within technology, Vector invests across a variety of sectors, including Vertical Applications, Horizontal Applications, Data Analytics, Cloud & IT Infrastructure Solutions, IT Security, Mobile Technologies, IP Licensing, Data & Information Services, Data Communications Solutions, Digital Media & Internet, and Industrial Tech & Internet of Things, among others. Vector s disciplined approach to valuation and flexible approach to investment structure is intended to deliver superior risk adjusted returns. Vector Capital s principals include Mr. Alex Slusky, Vector s Founder, Managing Director, and Chief Investment Officer; Mr. David Fishman, Managing Director and Head of Vector s Investment Team; and Mr. David Baylor, Managing Director and Chief Operating Officer. Mr. Slusky, Mr. Fishman, and Mr. Baylor are supported by more than 30 investing and operating professionals including a dedicated sourcing team, a highly experienced investment team, and a value creation team with over 300 years of collective experience within the technology sector. We believe that Vector Capital s technology expertise serves as a significant competitive advantage over generalist private equity funds when sourcing investment opportunities, conducting due diligence, adding value post-acquisition, and exiting investments. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED MARCH 17, 2022 PRELIMINARY PROSPECTUS Vector Acquisition Corporation III $250,000,000 25,000,000 Class A Ordinary Shares Vector Acquisition Corporation III is a blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target. We will not be limited to a particular industry or geographic region in our identification and acquisition of a target company. This is an initial public offering of our Class A ordinary shares, par value $0.0001 per share, which we refer to as our public shares, at an initial public offering price of $10.00. The underwriters have a 45-day option from the date of this prospectus to purchase up to 3,750,000 additional public shares to cover over-allotments, if any. Unlike other initial public offerings of special purpose acquisition companies, investors in this offering will not receive warrants that would become exercisable following completion of our initial business combination. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination, subject to the limitations as described herein. If we have not consummated an initial business combination within 24 months from the closing of this offering, we will redeem 100% of the public shares for cash, subject to applicable law and certain conditions as described herein. Our sponsor has agreed to purchase 700,000 Class A ordinary shares (or 775,000 Class A ordinary shares if the underwriters over-allotment option is exercised in full), at a price of $10.00 per share, in a private placement to occur concurrently with the closing of this offering. The private placement shares are identical to the Class A ordinary shares sold in this offering, subject to certain limited exceptions as described in this prospectus. Our initial shareholders currently own 7,187,500 Class B ordinary shares, up to 937,500 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described herein. Prior to our initial business combination, only holders of our Class B ordinary shares will be entitled to vote on the election of directors. On any other matter submitted to a vote of our shareholders, holders of the Class B ordinary shares and holders of the Class A ordinary shares will vote together as a single class, except that in respect of any vote or votes to continue the company in a jurisdiction outside the Cayman Islands (including, but not limited to, the approval of the organizational documents of the company in such other jurisdiction), holders of Class B ordinary shares will have ten votes per share and holders of Class A ordinary shares will have one vote per share, and except as required by law or the applicable rules of the stock exchange then in effect. Currently, there is no public market for our Class A ordinary shares. We have applied to have our Class A ordinary shares listed on the Nasdaq Capital Market, or the Nasdaq, under the symbol VAQA. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 29 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per share Total Public offering price $ 10.00 250,000,000 Underwriting discounts and commissions(1) $ 0.55 13,750,000 Proceeds, before expenses, to us $ 9.45 236,250,000 (1) Includes $0.35 per share, or $8,750,000 in the aggregate (or $10,062,500 in the aggregate if the underwriters over-allotment option is exercised in full), payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein and released to the underwriters only upon the consummation of an initial business combination. See also Underwriting for a description of compensation payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement shares described in this prospectus, $250,000,000, or $287,500,000 if the underwriters over-allotment option is exercised in full ($10.00 per share in either case), will be deposited into a U.S. based trust account at Bank of America Corporation with Continental Stock Transfer & Trust Company acting as trustee. The underwriters are offering the public shares for sale on a firm commitment basis. The underwriters expect to deliver the public shares to the purchasers on or about , 2022. Joint Book-Running Managers Deutsche Bank Securities J.P. Morgan The date of this prospectus is , 2022 Table of Contents We expect that our company will leverage the full capabilities of the Vector platform and have comprehensive access to its team, deal prospects, and network, along with any necessary resources to aid in the identification, diligence, and operational support of a target for the initial business combination. Our Management Team Our management team is led by Mr. Slusky, Mr. Fishman, and Mr. Baylor. Collectively, they have more than 90 years of operational, financial, investment, and transactional experience, primarily within the technology sector. Our management team will be supported by Mr. Patrick Nichols and Ms. Jacqueline Lenart, who will serve as our directors along with Mr. Slusky. Mr. Slusky founded Vector Capital in 1997 and has more than 25 years of investing and operating experience in technology companies. He is our Chief Executive Officer and Chairman and holds the same positions with Vector Acquisition Corporation II (Nasdaq: VAQC) ( Vector II ) and Vector Acquisition Corporation IV ( Vector IV and, collectively with Vector II and any future special purpose acquisition companies sponsored by an affiliate of Vector Capital, the Vector SPACs ). The Vector SPACs are special purpose acquisition companies sponsored by an affiliate of Vector Capital. Mr. Slusky also previously served as Chief Executive Officer and Chairman of Vector Acquisition Corporation ( Vector I ), a special purpose acquisition company that completed its initial business combination with Rocket Lab USA, Inc. ( Rocket Lab ) in 2021. Mr. Slusky currently serves on the Board of Directors of Rocket Lab. Mr. Slusky has deep technical experience in both private and public technology companies and has successfully invested across multiple market cycles including the 1998 2000 Internet bubble and the 2008 2009 financial crisis. Prior to founding Vector Capital, Mr. Slusky led the technology equity practice at Ziff Brothers Investments, managing a portfolio of public and private technology investments which later became Vector Capital I. Prior to Ziff, Mr. Slusky spent three years at New Enterprise Associates (NEA), where he focused on venture investments in software, communications, and digital media. Mr. Slusky began his career at Microsoft and McKinsey & Company. Mr. Fishman joined Vector Capital in 2006 and has more than 20 years of investing and transactional experience in technology companies. He is our President and holds the same position with Vector II and Vector IV. Mr. Fishman also previously served as President of Vector I, a special purpose acquisition company that completed its initial business combination with Rocket Lab in 2021. Prior to joining Vector, Mr. Fishman spent ten years at Goldman, Sachs & Co. where he was a Managing Director in the Mergers and Acquisitions division and focused on technology and media transactions. Mr. Fishman has extensive transaction expertise, having consummated approximately 30 mergers and acquisitions during his tenure at Goldman, worth an aggregate value of $110 billion, including transactions involving Microsoft, eBay, Adobe, IBM, Oracle, and PeopleSoft. Mr. Baylor joined Vector Capital in 2008 and has more than 30 years of operating experience, including as a senior executive at a publicly traded company. He is our Chief Financial Officer and holds the same position with Vector II and Vector IV. Mr. Baylor also previously served as Chief Financial Officer of Vector I, a special purpose acquisition company that completed its initial business combination with Rocket Lab in 2021. Prior to joining Vector, Mr. Baylor was the Chief Operating Officer and Chief Financial Officer at Thomas Weisel Partners where he was a member of the Executive Committee. Prior to Thomas Weisel Partners, Mr. Baylor was a Managing Director with Montgomery Securities, a securities attorney with Howard, Rice, Nemerovski, Canady, Falk & Rabkin, and a certified public accountant with Deloitte & Touche. Mr. Slusky and Mr. Fishman, who have worked together for 14 years and constitute Vector Capital s Investment Committee, have spent their entire careers evaluating and investing in technology businesses and have a deep understanding of trends, market cycles, vertical expertise, and the proven ability to identify, diligence, structure, and transform technology investments. Table of Contents Mr. Nichols has been Chief Executive Officer of Quest Software since April 2020. He serves on the board of directors of Vector II. Prior to joining Quest Software, Mr. Nichols was Chief Executive Officer of Corel Corporation. Ms. Lenart has global, multi-channel, consumer and retail experience. During the past eight years, Ms. Lenart has held a number of retained advisory engagements for private equity and venture-backed portfolio companies focused on value creation in the consumer and retail sectors. Ms. Lenart has been an advisor to XB Advisors LLC since 2017 where she is part of a team sourcing strategic deals for US private equity portfolio companies. From 2014 to 2017, Ms. Lenart was an Advisory Director for Investcorp, a leading provider and manager of alternative investment products, supporting their North American private equity team. Prior to joining Investcorp, Ms. Lenart spent nine years in executive marketing roles within Gap Inc. and before that, eight years with The Campbell Soup Company both in the US and Australia. Ms Lenart holds a Bachelor of Commerce (Summa Cum Laude) from The University of New South Wales, Sydney Australia. Our management team is supported by Vector Capital s entire team of sourcing, investment, and operating professionals, all of whom had meaningful experience investing in, advising, or working at technology companies before joining Vector. Vector Capital s core team has been investing together in the technology sector for over a decade and has collectively built a network of relationships that we believe will be invaluable for providing us with a substantial number of attractive business targets. Experience with Special Purpose Acquisition Vehicles In July 2020, certain members of our management team formed Vector I, a blank check company incorporated as a Cayman Islands exempted company and formed for substantially similar purposes as our company. Vector I completed its initial public offering in September 2020, selling 32,000,000 units (including 2,000,000 pursuant to the underwriters partial exercise of their over-allotment option), each consisting of one Class A ordinary share of Vector I and one-third of one redeemable warrant to purchase one Class A ordinary share of Vector I, and generating aggregate proceeds of $320 million. On August 25, 2021, Vector I announced that it completed its initial business combination with Rocket Lab, an end-to-end space company and global leader in launch. The combined company is listed on the Nasdaq under the symbol RKLB. In January 2021, certain members of our management team formed Vector II, a blank check company incorporated as a Cayman Islands exempted company and formed for substantially similar purposes as our company. Vector II closed its upsized initial public offering in March 2021, selling 45,000,000 Class A ordinary shares for aggregate proceeds of $450 million. Vector II has not yet announced or completed its initial business combination. In addition, certain members of our management team formed Vector IV, a blank check company incorporated as a Cayman Islands exempted company and formed for substantially similar purposes as our company. Vector IV has filed a registration statement with respect to its offering of $350 million initial public offering of Class A ordinary shares. Mr. Slusky, Mr. Fishman and Mr. Baylor serve as the Chief Executive Officer and Chairman, the President, and the Chief Financial Officer of the Vector SPACs, respectively, and Ms. Lenart will serve as a director of Vector IV. Each of Messrs. Slusky, Fishman and Baylor owe fiduciary duties under Cayman Islands law to each of the Vector SPACs, and Ms. Lenart owes fiduciary duties under Cayman Islands law to Vector IV. The performance of our management team and their respective affiliates with past or current endeavors, including Vector Capital and the Vector SPACs, is not a guarantee of either (i) our ability to successfully identify and execute a transaction or (ii) success with respect to any business combination that we may consummate. You should not rely on the performance of our management team or their respective affiliates with past or current endeavors, including with Vector Capital and the Vector SPACs, as indicative of our future performance. Our management team and their respective affiliates have been involved with a large number of public and private companies in addition to those identified above, not all of which have achieved similar performance levels. See Table of Contents
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and article of association are to the amended and restated memorandum and articles of association that the company will adopt prior to the consummation of this offering; Companies Act are to the Companies Act (2021 Revision) of the Cayman Islands as the same may be amended from time to time; founder shares are to our Class B ordinary shares initially issued to our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof (for the avoidance of doubt, such Class A ordinary shares will not be public shares ); management or our management team are to our executive officers and directors (including our directors nominees that will become directors in connection with the consummation of this offering); ordinary resolution means a resolution of the company adopted by the affirmative vote of at least a majority of the votes cast by the holders of the issued shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter, or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private placement shares are to the Class A ordinary shares to be issued to our sponsor in a private placement simultaneously with the closing of this offering (which private placement shares are identical to the public shares sold in this offering, subject to certain limited exceptions as described in this prospectus); public shares are to our Class A ordinary shares sold in this offering (whether they are purchased in this offering or thereafter in the open market), but specifically excludes all of our Class A ordinary shares that are issued upon conversion of our Class B ordinary shares; public shareholders are to the holders of our public shares, including our sponsor and management team to the extent our sponsor and/or members of our management team purchase public shares, provided that our sponsor s and each member of our management team s status as a public shareholder will only exist with respect to such public shares; special resolution means a resolution of the company adopted by the affirmative vote of at least a two-thirds (2/3) majority (or such higher threshold as specified in the company s amended and restated articles of association) of votes cast by the holders of the issued shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter, or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter; sponsor are to Vector Acquisition Partners IV, L.P., a Cayman Islands exempted limited partnership; and we, us, our, company or our company are to Vector Acquisition Corporation IV, a Cayman Islands exempted company. Table of Contents Explanatory Note Vector Acquisition Corporation IV is filing this Amendment No. 2 to its registration statement on Form S-1 (File No. 333-254297) (the Registration Statement ) to amend Item 16 of Part II thereof, file certain exhibits thereto and make corresponding changes throughout. Table of Contents Any forfeiture of shares described in this prospectus will take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares, or as otherwise permitted by our amended and restated memorandum and articles of association, as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. General We are a newly organized blank check company incorporated as a Cayman Islands exempted company and formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. To date, our efforts have been limited to organizational activities as well as activities related to this offering. We have not selected any potential business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any potential business combination target. Vector Capital Management, L.P., a technology-focused private investment firm, referred to herein as Vector Capital or Vector, is an affiliate of our sponsor, Vector Acquisition Partners IV, L.P. We intend to capitalize on the ability of our management team and the broader Vector Capital platform to identify, acquire, and operate a business in the technology and technology-enabled services sectors that may provide opportunities for attractive long-term risk-adjusted returns, though we reserve the right to pursue an acquisition opportunity in any business or industry. We have generated no operating revenues to date and we do not expect that we will generate operating revenues until we consummate our initial business combination. Vector Capital Vector Capital is a San Francisco-based private equity firm focused on special situations investments in technology and technology-enabled businesses in the middle-market. Founded in 1997, Vector currently oversees $3.5 billion in capital across its private equity and credit strategies and has invested $3.5 billion in more than 50 technology companies since its inception. Throughout its 24 year history, Vector has exclusively focused on investments within the technology sector and has built a successful track record of executing public buyouts, acquisitions of private and venture-backed companies, corporate spin-outs and divestitures, credit recapitalizations and restructurings, minority investments in bootstrapped companies, and private investments in public equity. Within technology, Vector invests across a variety of sectors, including Vertical Applications, Horizontal Applications, Data Analytics, Cloud & IT Infrastructure Solutions, IT Security, Mobile Technologies, IP Licensing, Data & Information Services, Data Communications Solutions, Digital Media & Internet, and Industrial Tech & Internet of Things, among others. Vector s disciplined approach to valuation and flexible approach to investment structure is intended to deliver superior risk adjusted returns. Vector Capital s principals include Mr. Alex Slusky, Vector s Founder, Managing Director, and Chief Investment Officer; Mr. David Fishman, Managing Director and Head of Vector s Investment Team; and Mr. David Baylor, Managing Director and Chief Operating Officer. Mr. Slusky, Mr. Fishman, and Mr. Baylor are supported by more than 30 investing and operating professionals including a dedicated sourcing team, a highly experienced investment team, and a value creation team with over 300 years of collective experience within the technology sector. We believe that Vector Capital s technology expertise serves as a significant competitive advantage over generalist private equity funds when sourcing investment opportunities, conducting due diligence, adding value post-acquisition, and exiting investments. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED MARCH 17, 2022 PRELIMINARY PROSPECTUS Vector Acquisition Corporation IV $350,000,000 35,000,000 Class A Ordinary Shares Vector Acquisition Corporation IV is a blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target. We will not be limited to a particular industry or geographic region in our identification and acquisition of a target company. This is an initial public offering of our Class A ordinary shares, par value $.0001 per share, which we refer to as our public shares, at an initial public offering price of $10.00. The underwriters have a 45-day option from the date of this prospectus to purchase up to 5,250,000 additional public shares to cover over-allotments, if any. Unlike other initial public offerings of special purpose acquisition companies, investors in this offering will not receive warrants that would become exercisable following completion of our initial business combination. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination, subject to the limitations as described herein. If we have not consummated an initial business combination within 24 months from the closing of this offering, we will redeem 100% of the public shares for cash, subject to applicable law and certain conditions as described herein. Our sponsor has agreed to purchase 900,000 Class A ordinary shares (or 1,005,000 Class A ordinary shares if the underwriters over-allotment option is exercised in full), at a price of $10.00 per share, in a private placement to occur concurrently with the closing of this offering. The private placement shares are identical to the Class A ordinary shares sold in this offering, subject to certain limited exceptions as described in this prospectus. Our initial shareholders currently own 10,062,500 Class B ordinary shares, up to 1,312,500 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described herein. Prior to our initial business combination, only holders of our Class B ordinary shares will be entitled to vote on the election of directors. On any other matter submitted to a vote of our shareholders, holders of the Class B ordinary shares and holders of the Class A ordinary shares will vote together as a single class, except that in respect of any vote or votes to continue the company in a jurisdiction outside the Cayman Islands (including, but not limited to, the approval of the organizational documents of the company in such other jurisdiction), holders of Class B ordinary shares will have ten votes per share and holders of Class A ordinary shares will have one vote per share, and except as required by law or the applicable rules of the stock exchange then in effect. Currently, there is no public market for our Class A ordinary shares. We have applied to have our Class A ordinary shares listed on the Nasdaq Capital Market, or the Nasdaq, under the symbol VAQB. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 30 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per share Total Public offering price $ 10.00 350,000,000 Underwriting discounts and commissions(1) $ 0.55 19,250,000 Proceeds, before expenses, to us $ 9.45 330,750,000 (1) Includes $0.35 per share, or $12,250,000 in the aggregate (or $14,087,500 in the aggregate if the underwriters over-allotment option is exercised in full), payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein and released to the underwriters only upon the consummation of an initial business combination. See also Underwriting for a description of compensation payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement shares described in this prospectus, $350,000,000, or $402,500,000 if the underwriters over-allotment option is exercised in full ($10.00 per share in either case), will be deposited into a U.S. based trust account at Bank of America Corporation with Continental Stock Transfer & Trust Company acting as trustee. The underwriters are offering the public shares for sale on a firm commitment basis. The underwriters expect to deliver the public shares to the purchasers on or about , 2022. Joint Book-Running Managers Deutsche Bank Securities J.P. Morgan The date of this prospectus is , 2022 Table of Contents We expect that our company will leverage the full capabilities of the Vector platform and have comprehensive access to its team, deal prospects, and network, along with any necessary resources to aid in the identification, diligence, and operational support of a target for the initial business combination. Our Management Team Our management team is led by Mr. Slusky, Mr. Fishman, and Mr. Baylor. Collectively, they have more than 90 years of operational, financial, investment, and transactional experience, primarily within the technology sector. Our management team will be supported by Ms. Jacqueline Lenart and Mr. Lawrence Miao, who will serve as our directors along with Mr. Slusky. Mr. Slusky founded Vector Capital in 1997 and has more than 25 years of investing and operating experience in technology companies. He is our Chief Executive Officer and Chairman and holds the same positions with Vector Acquisition Corporation II (Nasdaq: VAQC) ( Vector II ) and Vector Acquisition Corporation III ( Vector III and, collectively with Vector II and any future special purpose acquisition companies sponsored by an affiliate of Vector Capital, the Vector SPACs ). The Vector SPACs are special purpose acquisition companies sponsored by an affiliate of Vector Capital. Mr. Slusky also previously served as Chief Executive Officer and Chairman of Vector Acquisition Corporation ( Vector I ), a special purpose acquisition company that completed its initial business combination with Rocket Lab USA, Inc. ( Rocket Lab ) in 2021. Mr. Slusky currently serves on the Board of Directors of Rocket Lab. Mr. Slusky has deep technical experience in both private and public technology companies and has successfully invested across multiple market cycles including the 1998 2000 Internet bubble and the 2008 2009 financial crisis. Prior to founding Vector Capital, Mr. Slusky led the technology equity practice at Ziff Brothers Investments, managing a portfolio of public and private technology investments which later became Vector Capital I. Prior to Ziff, Mr. Slusky spent three years at New Enterprise Associates (NEA), where he focused on venture investments in software, communications, and digital media. Mr. Slusky began his career at Microsoft and McKinsey & Company. Mr. Fishman joined Vector Capital in 2006 and has more than 20 years of investing and transactional experience in technology companies. He is our President and holds the same position with Vector II and Vector III. Mr. Fishman also previously served as President of Vector I, a special purpose acquisition company that completed its initial business combination with Rocket Lab in 2021. Prior to joining Vector, Mr. Fishman spent ten years at Goldman, Sachs & Co. where he was a Managing Director in the Mergers and Acquisitions division and focused on technology and media transactions. Mr. Fishman has extensive transaction expertise, having consummated approximately 30 mergers and acquisitions during his tenure at Goldman, worth an aggregate value of $110 billion, including transactions involving Microsoft, eBay, Adobe, IBM, Oracle, and PeopleSoft. Mr. Baylor joined Vector Capital in 2008 and has more than 30 years of operating experience, including as a senior executive at a publicly traded company. He is our Chief Financial Officer and holds the same position with Vector II and Vector III. Mr. Baylor also previously served as Chief Financial Officer of Vector I, a special purpose acquisition company that completed its initial business combination with Rocket Lab in 2021. Prior to joining Vector, Mr. Baylor was the Chief Operating Officer and Chief Financial Officer at Thomas Weisel Partners where he was a member of the Executive Committee. Prior to Thomas Weisel Partners, Mr. Baylor was a Managing Director with Montgomery Securities, a securities attorney with Howard, Rice, Nemerovski, Canady, Falk & Rabkin, and a certified public accountant with Deloitte & Touche. Mr. Slusky and Mr. Fishman, who have worked together for 14 years and constitute Vector Capital s Investment Committee, have spent their entire careers evaluating and investing in technology businesses and have a deep understanding of trends, market cycles, vertical expertise, and the proven ability to identify, diligence, structure, and transform technology investments. Table of Contents We are responsible for the information contained in this prospectus. We have not, and the underwriters have not, authorized anyone to provide you with different information, and neither we nor the underwriters take any responsibility for any other information others may give to you. We are not, and the underwriters are not, making an offer to sell securities in any jurisdiction where the offer or sale is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front of this prospectus. TABLE OF CONTENTS Page SUMMARY 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and articles of association are to the amended and restated memorandum and articles of association that the company will adopt prior to the consummation of this offering; ordinary resolution are to a resolution adopted by the affirmative vote of at least a majority of the votes cast by the holders of the issued shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter; Companies Act are to the Companies Act (as amended) of the Cayman Islands as the same may be amended from time to time; founder shares are to our Class B ordinary shares initially issued to our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof (for the avoidance of doubt, such Class A ordinary shares will not be public shares ); management or our management team are to our executive officers and directors (including our directors nominees that will become directors in connection with the consummation of this offering); ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private placement warrants are to the warrants to be issued to our sponsor in a private placement simultaneously with the closing of this offering and upon conversion of working capital loans, if any, and the Sponsor Loan as described herein; public shares are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) (except as described in the definition of founder shares above); public shareholders are to the holders of our public shares, including our sponsor and management team to the extent our sponsor and/or members of our management team purchase public shares, provided that our sponsor s and each member of our management team s status as a public shareholder will only exist with respect to such public shares; special resolution are to a resolution adopted by the affirmative vote of at least a two-thirds (2/3) majority (or such higher threshold as specified in the company s amended and restated memorandum and articles of association) of the votes cast by the holders of the issued shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter; sponsor are to Constitution Acquisition Sponsor LLC, a Delaware limited liability company; Sponsor Loan is the loan our sponsor will be making to us simultaneously with the closing of this offering in order to ensure that the amount in the trust account is $10.20 per public share as of the closing of this offering; Old Ironsides Energy are to Old Ironsides Energy, LLC, an affiliate of our sponsor; and we, us, our, company, our company or Constitution are to Constitution Acquisition Corp., a Cayman Islands exempted company. Table of Contents PROSPECTUS Constitution Acquisition Corp. $200,000,000 20,000,000 Units Constitution Acquisition Corp. is a blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. Although we may pursue an initial business combination with any business in any industry and any geographic location, we intend to target opportunities and companies in the natural gas value chain in North America, specifically those that focus on the upstream, midstream, downstream, and power sectors, as well as other adjacent products, services, and technologies. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share and one-half of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment, terms and limitations as described herein. The warrants will become exercisable 30 days after the completion of our initial business combination, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. The underwriters have a 45-day option from the date of this prospectus to purchase up to 3,000,000 additional units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination, subject to the limitations as described herein. If we have not consummated an initial business combination within 18 months from the closing of this offering (or up to 24 months, if we extend the time to complete a business combination as described in this prospectus), we will redeem 100% of the public shares for cash, subject to applicable law and certain conditions as described herein. If we anticipate that we may not be able to consummate an initial business combination within 18 months, we may, but are not obligated to, extend the period of time to consummate an initial business combination by an additional three months on two separate occasions (after the exercise of all extensions, the Company will have a total of up to 24 months to complete an initial business combination). Our public shareholders will not be offered the opportunity to vote on or redeem their shares in connection with any such extension. In order to extend the time available for us to consummate our initial business combination, we, upon five days advance notice prior to the applicable deadline, must deposit into the trust account for each three month extension (of which there may be no more than two such extensions) $2,000,000 or $2,300,000 if the underwriters over-allotment option is exercised in full ($0.10 per share in either case), on or prior to the date of the applicable deadline. Any such extension payments would be funded from the proceeds of a loan between our sponsor and us. The terms in connection with such loans have not been negotiated and will only be finally determined at the time of entry into such loans. If we complete our initial business combination, we expect that we would repay such loaned amounts in cash out of the proceeds of the trust account released to us, or, at the discretion of our sponsor, such loan will be satisfied by the issuance of Private Placement Warrants at a price per warrant of $1.00. Our sponsor is under no obligation to fund any monies necessary to extend the duration of the trust account. Our sponsor, Constitution Acquisition Sponsor LLC, has agreed to lend us $4,000,000 (or $4,600,000 if the underwriters over-allotment option is exercised in full) as of the closing date of this offering at no interest (the Sponsor Loan ). The proceeds of the Sponsor Loan will be deposited into the trust account and will be repaid in cash or converted into private placement warrants at a conversion price of $1.00 per warrant, at the sponsor s discretion. The Sponsor Loan is being extended in order to ensure that the amount in the trust account is $10.20 per public share. If we do not complete an initial business combination, we will not repay the Sponsor Loan and its proceeds will be distributed to our public shareholders. Our sponsor has waived any claims against the trust account in connection with the Sponsor Loan. Our sponsor has agreed to purchase 6,750,000 warrants (or 7,350,000 warrants if the underwriters over-allotment option is exercised in full), each exercisable to purchase one Class A ordinary share at $11.50 per share, subject to adjustment, at a price of $1.00 per warrant, in a private placement to occur concurrently with the closing of this offering. Our initial shareholders currently own 5,750,000 Class B ordinary shares, up to 750,000 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described herein. Prior to our initial business combination, only holders of our Class B ordinary shares will be entitled to vote on the appointment and removal of directors. In addition, in a vote to continue our company in a jurisdiction outside the Cayman Islands (including, but not limited to, the approval of the organizational documents for such jurisdiction) which requires the approval of at least two thirds of the votes cast by the holders of the issued ordinary shares present in person or represented by proxy at a shareholder meeting, holders of our Class B ordinary shares will have ten votes for every Class B ordinary share and holders of our Class A ordinary shares will have one vote for every Class A ordinary share. Currently, there is no public market for our securities. We intend to apply to have our units listed on The Nasdaq Global Market (the Nasdaq ), under the symbol USSCU. We expect that the Class A ordinary shares and warrants comprising the units will begin separate trading on the Nasdaq under the symbols USSC and USSCW, respectively, on the 52nd day (or, if such date is not a business day, the following business day) following the date of this prospectus unless the underwriters permit earlier separate trading and we have satisfied certain conditions. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 42 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 200,000,000 Underwriting discounts and commissions(1) $ 0.55 11,000,000 Proceeds, before expenses, to us $ 9.45 189,000,000 (1) Includes $0.35 per unit, or $7,000,000 in the aggregate (or $8,050,000 in the aggregate if the underwriters over-allotment option is exercised in full), payable to the underwriter for deferred underwriting commissions to be placed in a trust account located in the United States as described herein and released to the underwriter only upon the consummation of an initial business combination. See also Underwriting for a description of compensation and other items of value payable to the underwriter. Of the proceeds we receive from this offering, the sale of the private placement warrants and the Sponsor Loan described in this prospectus, $204,000,000, or $234,600,000 if the underwriters over-allotment option is exercised in full ($10.20 per unit in either case), will be deposited into a U.S. based trust account with Continental Stock Transfer & Trust Company acting as trustee. The underwriter is offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2022. Joint Book-Running Managers Cowen Intrepid Partners The date of this prospectus is , 2022 Table of Contents Any forfeiture of shares described in this prospectus will take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law, or as otherwise permitted by our amended and restated memorandum and articles of association. Any share dividends described in this prospectus will take effect as share capitalizations as a matter of Cayman Islands law. Each unit consists of one Class A ordinary share and one-half of one warrant for each unit purchased. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as described in this prospectus, and only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Table of Contents We are responsible for the information contained in this prospectus. We have not authorized anyone to provide you with different information, and neither we nor the underwriters take any responsibility for any other information others may give to you. We are not, and the underwriters are not, making an offer to sell securities in any jurisdiction where the offer or sale is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front of this prospectus or, if applicable, any other date specified herein. TABLE OF CONTENTS Page SUMMARY 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: common stock are to our common stock, par value $0.0001 per share; founder shares are to shares of our common stock held by our initial stockholders prior to this offering; initial stockholders are to our sponsor and any other holders of our founder shares prior to this offering (or their permitted transferees); management or our management team are to our officers and directors; private placement units are to the units issued to our sponsor in a private placement simultaneously with the closing of this offering; public shares are to shares of our common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our initial stockholders and members of our management team to the extent our initial stockholders and/or members of our management team purchase public shares; provided that each initial stockholder s and member of our management team s status as a public stockholder shall only exist with respect to such public shares; sponsor are to Hudson SPAC Holding, LLC, a Delaware limited liability company and wholly-owned subsidiary of PX Capital Partners L.P., of which Pengfei Xie is the General Partner; trust account are to the trust account in the United States at JPMorgan Chase, with Continental Stock Transfer & Trust Company acting as trustee, into which we will deposit certain proceeds from this offering; and we, us, Company or our company are to Hudson Acquisition I Corp., a Delaware corporation. Except as specifically provided otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. General We are a blank check company formed under the laws of the State of Delaware on January 13, 2021, whose business purpose is to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. We shall not undertake our initial business combination with any entity being based in or having the majority of its operations in China (including Hong Kong and Macau). We will seek to capitalize on the collective deal making experience and business connections of our management team (the Hudson Team ), forged during decades of close teamwork and cooperation. Some of the key members of the Hudson Team, including the CEO Jiang Hui, the senior advisor Pengfei Xie and the independent director Lixin Wu, are graduates of Peking University, one of the most prestigious educational institutions in China. The alumni network of the Peking University (Americas) includes more than 300,000 members with at least 14 registered regional alumni associations in the United States. Pengfei Xie is also a graduate of the MIT Sloan School and serves as a member of its Executive Board (Americas). Through various channels, including the alumni networks of the Peking University (Americas) and the MIT Sloan School, the Hudson team gets access to an ecosystem of innovative leaders and executives in both public and private companies globally, and intends to identify a prospective target business with an established business model and the ability to expand its products and services offerings both in developed and emerging markets. Sectors of interests include financial technology, consumer technology, medical technology as well as advanced mobility technology. 1 Table of Contents In addition to being able to access target companies through their social network, the Hudson team worked together on several deals, including managing two public companies in the United States, the Hudson Capital Inc. (Nasdaq HUSN ) and Wave Sync Corp. (OTCQB WAYS ). Under the Hudson Team s management, these public companies conducted successful organizational restructurings and mergers, which increased a shareholder value. In February, 2022, HUSN completed a merger with FreightHub, a North American digital transportation logistics platform company with a focus on U.S.-Mexico cross-border shipping. Other than the two public companies mentioned above, members of the Hudson Team, either individually or collectively, managed, invested, or advised several other public companies, such as Kiwa Bio-tech Products Group Corporation. Mr. Jiang Hui, our Chief Executive Officer and Chairman of the Board, is a seasoned financial professional with deep experiences in banking and securities business. He is the Chairman and Chief Executive Officer of Wave Sync Corp. (OTCQB WAYS ) since 2021. Prior to that, Mr. Hui held various positions at the New York and London offices of Industrial and Commercial Bank of China (ICBC), China s largest financial institution; including Vice President of ICBC s New York Branch, Vice President of ICBC (London) PLC, and Chief Compliance Officer of the Investment Advisory business at ICBC Financial Services, LLC, a SEC-registered Broker-Dealer. Mr. Hui received his Bachelor of Law and Master of Finance from Tsinghua University and Peking University in China, and received his second Master s degree in Securities and Financial Regulation from Georgetown University Law Center. Hon Man Yun, our Chief Financial Officer, also serves as the Chief Financial Officer and director for Wave Sync Corp. (OTCQB WAYS ) since February 2021. Mr. Yun has extensive experiences as an auditor, independent director, and member of the audit committees of public companies. Mr. Yun has worked as the Chief Financial Officer of Kiwa Bio-tech Products Group Corporate since April 2018 and served as the CFO and a director at Hudson Capital Inc. since August 2020 until February 2022. Mr. Yun served as joint company secretary, as a group vice president, the chief accountant and compliance and internal audit officer for Kaisun Energy Group Limited, from May 2017 to August 2020. Mr. Yun earned a higher diploma in Business Studies from the City University of Hong Kong, formerly City Polytechnic of Hong Kong, and a Master of Business Administration from the University of Western Sydney. Pengfei Xie, our senior advisor, also serves as a member of the MIT Sloan School Executive Board (Americas) and a Board member for the Peking University Education Foundation (USA). Mr. Xie, over the past twenty years, has gained extensive experience in financial market analysis and investment advisory services. Mr. Xie started his career as a Fixed Income Analyst at a New York based hedge fund in 1997. Later in 1999, he joined General Motors Asset Management Corp. as an Analyst and was later promoted to the Fund Manager position with the responsibility of overseeing and managing the company s Global Portable Alpha Fund and the Multi-Sector Bond Fund. From 2006 to 2009, Mr. Xie served as Senior Analyst focusing on Credit and Fixed Income strategies and later as the Head of Relative Value and a member of the Investment Committee of EIM Management (USA). In April 2009, Mr. Xie became the Managing Director of Investments of EIM and later in 2012 joined the Advisory Board of EIM. Since August 2012 until now, Mr. Xie has been serving as the Managing Member and Chief Investment Officer of PX Global Advisors, LLC, an investment advisory firm founded by him. Mr. Xie s representative investment portfolio includes Elroy Air Inc., Peloton Interactive, Inc., and Afterpay Limited. Mr. Xie holds a Master of Business Administration degree from the Massachusetts Institute of Technology and a Bachelor of Science from Peking University. Management also expects to greatly benefit from the depth of experience and relationships of our Board Members: Rodobaldo Rolo Duartes, our independent director, is the founder and managing partner of DoubleDay Engineering, LLC ( DoubleDay ), an engineering development firm specializing in infrastructure development, commercial real-estate investment, and federal contracting. Mr. Duartes is a Registered Professional Engineer (P.E.), with over 25 years of experience in construction, development, forensics engineering and management. Prior to founding DoubleDay, Mr. Duartes was an Executive Vice President of Sales for Univision Communications, a leading Hispanic media company in the U.S., where he oversaw 65 sales executives and over $600 million in Madison Avenue agency business. He was an M&A investment banker at Bear Stearns from 1999 to 2002. Mr. Duartes earned a B.S. in Electrical Engineering from the University of Florida, an M.B.A. from Columbia Business School, and an M.P.A. from the Kennedy School of Government at Harvard University. Chiang Hsien, our independent director, has over 30 years of experience in investment and asset management. Since 2020, Mr. Hsien has been working as an independent consultant for various corporations on a part-time basis. From 2016 to 2019, he was an advisor to the Chairman of the Pacific Millennium Group, a leading packaging supplier in 2 Table of Contents China. From 2013 to 2016, Mr. Hsien was a Partner and Chief Representative in Asia for Lingohr & Partner Asset Management, a German asset management company. From 2008 to 2012, Mr. Hsien was Chief Representative and Director of Allianz Global Investors Hong Kong Ltd., and CEO of the Shanghai Representative Office. Allianz Global Investors is a global asset management company and a subsidiary of Allianz SE. From 2003 to 2008, Mr. Hsien was Chief Executive Officer and Director of Guotai Junan-Allianz Asset Management, which is one of the first joint-venture mutual fund management companies established in China. From 2000 to 2003, Mr. Hsien was Chief Executive Officer and Managing Director of Dresdner Securities Investment Trust Enterprise Taiwan (now Allianz Asset Management Taiwan). Mr. Hsien has a Bachelor of Arts Degree from University of International Relations Beijing (China), an MBA degree from the Christian Albrecht University of Kiel in Germany and attended Executive Programs at INSEAD and at Harvard University. Lixin Wu, our independent director, is an investment manager with over 15 years of experiences in real estate, automotive trading and financing firms. He is the President of Bauing Group USA Ltd., the U.S. subsidiary of Bauing Group (SZ.2047) since 2016, a Chinese leading integrated design enterprise. Mr. Wu is also the Managing Director of CASB Ventures LLC since 2000. CASB LLC is an angel investment fund focusing on high tech companies. Mr. Wu earned a Bachelor of Science in Physics from Peking University in China and a Master of Science in Physics from Worcester Polytechnic Institute in Massachusetts, U.S. The past performance of our management team, or their respective affiliates, is not a guarantee either (i) of success with respect to any business combination we may consummate or (ii) that we will be able to identify a suitable candidate for our initial business combination. No member of our management team has been an officer or director of a special purpose acquisition corporation in the past. You should not rely on the historical record of our management team s or their respective affiliates performance as indicative of our future performance. Our officers and directors may become an officer or director of any another special purpose acquisition company with a class of securities intended to be registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act, prior to the completion of our initial business combination. Business Strategy Our business strategy is to identify and complete our initial business combination with a company that complements the experience of our management team and can benefit from their operational, marketing and financial expertise. Our selection process will leverage the Hudson Team s broad relationship, deep industry experience and deal sourcing capabilities to access a wide spectrum of opportunities in the technology sector in the United States. This network has been developed over the past decades in executive positions with various global firms and public companies. We shall not undertake our initial business combination with any entity being based in or having the majority of its operations in China (including Hong Kong and Macau). We believe that our management team will identify a business combination that will benefit from their experience, including: Long history of sourcing, structuring, acquiring, operating, developing, growing and financing businesses; Significant integration experience implementing new technologies and systems to drive value and standardization; Strong marketing and capital allocation decision-making to establish and maintain premium brand; and Sound understanding of public company performance requirements and ability to guide private-to-public process. Upon completion of this offering, our management team will access their network of relationships to articulate the parameters for our search for a target company and begin the process of reviewing and pursuing potential business combinations. Acquisition Criteria Our acquisition strategy will leverage the Hudson Team s network of long-standing relationships and industry contacts as well as inbound opportunities to source a business combination. Consistent with our business strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating 3 Table of Contents prospective target businesses. We shall not undertake our initial business combination with any entity being based in or having the majority of its operations in China (including Hong Kong and Macau). We will use these criteria and guidelines in evaluating acquisition opportunities, and we intend to identify and acquire one or more businesses that we believe exhibit a number of the following attributes: Well established market presence with recognizable brand and reputation for quality service; Platform with sufficient scale and geographic concentration from which to expand through acquisitions; Generates stable free cash flow or has the potential to do so near term; Generates returns well in excess of the cost of capital; Easily identified cost savings that can be realized near term; Modest capital requirements to refurbish locations to quality standards; Can benefit from new technologies and systems to meaningfully enhance financial performance; Quality management and personnel with ability to contribute to growth strategy; and Would benefit from being publicly traded and having access to incremental growth capital. These criteria and guidelines are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general criteria and guidelines as well as other considerations, factors, criteria and guidelines that our management may deem relevant. In addition to any potential business candidates we may identify on our own, we anticipate that other target business candidates will be brought to our attention from various unaffiliated sources, including investment market participants, private equity funds and large business enterprises seeking to divest non core assets or divisions. Acquisition Process In evaluating a prospective target business, we expect to conduct an extensive due diligence review which may encompass, as applicable and among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities and a review of financial and other information about the target and its industry. We will also utilize our management team s operational and capital planning experience. We are not prohibited from pursuing an initial business combination with a target that is affiliated with our sponsor, officers or directors or making the initial business combination through a joint venture or other form of shared ownership with our sponsor, officers or directors. In the event we seek to complete our initial business combination with an initial business combination target that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, would obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions that such an initial business combination is fair to our company from a financial point of view. Our senior advisor Pengfei Xie manages indirectly the sponsor, which will directly own founder shares following this offering and, accordingly, Pengfei Xie may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, our officers, directors or senior advisor may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Certain of our directors and officers currently have, and any of them in the future may have additional, fiduciary or contractual obligations to another entity pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity subject to his or her fiduciary duties. If any of our directors or officers becomes aware of a business combination opportunity that falls within the line of business of any entity to which he or she has then-existing fiduciary or contractual obligations, he or she may be required to present such business combination opportunity to such entity prior to presenting such business combination opportunity to us. 4 Table of Contents No members of our management team have any obligation to present us with any opportunity for a potential business combination of which they become aware, unless presented to such member specifically in his or her capacity as an officer or a director of the company. Members of our management team may be required to present potential business combinations to other entities to whom they have fiduciary duties before they present such opportunities to us. Any knowledge or presentation of such opportunities may therefore present conflicts of interest. Initial Business Combination In accordance with the rules of Nasdaq, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the value of the assets held in the trust account (net of amounts disbursed to management for working capital purposes, if any, and excluding the amount of deferred underwriting discounts held in trust and taxes payable on the income earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm that is a member of the Financial Industry Regulatory Authority ( FINRA ) or an independent valuation or appraisal firm with respect to satisfaction of such criteria. Our stockholders may not be provided with a copy of such opinion nor will they be able to rely on such opinion. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. Subject to this requirement, our management will have virtually unrestricted flexibility in identifying and selecting one or more prospective businesses, although we will not be permitted to effectuate our initial business combination with another blank check company or a similar company with nominal operations. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the prior owners of the target business, the target management team or stockholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of fair market value test. If the business combination involves more than one target business, the 80% of fair market value test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. The net proceeds of this offering released to us from the trust account upon the closing of our initial business combination may be used as consideration to pay the sellers of a target business with which we complete our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or used for redemption of our public shares, we may use the balance of the cash released to us from the trust account following the closing for general corporate purposes, including for maintenance or expansion of operations of the post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. In addition, we may be required to obtain additional financing in connection with the closing of our initial business combination to be used following the closing for general corporate purposes as described above. There is 5 Table of Contents no limitation on our ability to raise funds through the issuance of equity or equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements or backstop agreements we may enter into following consummation of this offering. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our initial business combination. At this time, we are not a party to any arrangement or understanding with any third party with respect to raising any additional funds through the sale of securities or otherwise. None of our sponsor, officers, directors or stockholders is required to provide any financing to us in connection with or after our initial business combination. We may also obtain financing prior to the closing of our initial business combination to fund our working capital needs and transaction costs in connection with our search for and completion of our initial business combination. Our amended and restated certificate of incorporation will provide that, following this offering and prior to the consummation of our initial business combination, we will be prohibited from issuing additional securities that would entitle the holders thereof to (i) receive funds from the trust account or (ii) vote as a class with our public shares (a) on any initial business combination or (b) to approve an amendment to our amended and restated certificate of incorporation to (x) extend the time we have to consummate a business combination beyond 9 months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount) or (y) amend the foregoing provisions, unless (in connection with any such amendment to our amended and restated certificate of incorporation) we offer our public stockholders the opportunity to redeem their public shares. In the event that our sponsor or its affiliates or designees, elect to extend the time to complete a business combination and deposit the applicable amount of money into trust, the sponsor would receive a non-interest bearing, unsecured promissory note equal to the amount of any such deposit that will not be repaid in the event that we are unable to close a business combination unless there are funds available outside the trust account to do so. Such notes would either be paid upon consummation of our initial business combination, or, at the sponsor s discretion, converted upon consummation of our business combination into additional private units at a price of $10.00 per unit. In the event that we receive notice from our sponsor five days prior to the applicable deadline of its intent to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the 9-month or 12-month deadline. In addition, we intend to issue a press release the day after the deadline announcing whether or not the funds had been timely deposited. The sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. If we are unable to consummate our initial business combination within such time period, we will, as promptly as possible but not more than ten business days thereafter, redeem 100% of our outstanding public shares for a pro rata portion of the funds held in the trust account, including a pro rata portion of any interest earned on the funds held in the trust account and not previously released to us to pay our taxes, and then seek to dissolve and liquidate. However, we may not be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public stockholders. In the event of our dissolution and liquidation, the private units will expire and will be worthless. Corporate Information Our office is located at 19 West 44th Street, Suite 1001, New York, New York 10036, and our telephone number is (347) 205-3126. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. 6 Table of Contents We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates exceeds $250 million as of the prior June 30th, or (2) our annual revenues exceed $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as of the last completed fiscal year. 7 Table of Contents THE OFFERING In deciding whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors beginning on page 29 of this prospectus. Securities offered 6,000,000(1) units, at $10.00 per unit, each unit consisting of: one share of common stock; and one right to purchase one fifth (1/5) of one share of common stock Proposed NASDAQ symbols Units: HUDAU Common Stock: HUDA Rights: HUDAR Trading commencement and separation of common stock and rights The units are expected to begin trading on or promptly after the date of this prospectus. We expect the common stock comprising the units will begin separate trading on the 30th day following the effective date of the registration statement of which this prospectus is a part unless Chardan informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. In no event, shall such separating trading occur until the preparation of an audited balance sheet of the Company and the filing thereof with the SEC reflecting the Company s receipt of the proceeds of the offering as of the closing date of the offering. Once the shares of common stock and rights commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of common stock and rights. No fractional share or right will be issued upon separation of the units and only whole shares and rights will trade. Separate trading of the common stock and rights is prohibited until we have filed a Current Report on Form 8-K In no event will the common stock and rights be traded separately until we have filed a Current Report on Form 8-K with the SEC containing an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which closing is anticipated to take place three business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. 8 Table of Contents Units: Number outstanding before this offering 0 Number outstanding after this offering 6,000,000(1) Common stock: Number outstanding before this offering 1,725,000 shares of common stock(2) Number outstanding after this offering and private placement offering 7,840,000 shares of common stock(1)(3) Rights: Number of Rights outstanding before this offering 0 Number of Rights to be sold in this offering 6,000,000(1) Number of Rights to be sold in the private placement as part of the private placement units 340,000(1) Number of Rights outstanding after this offering 6,340,000(1)(4) Terms of Rights: Except in cases where we are not the surviving company in a business combination, each holder of a public right will automatically receive one fifth (1/5) of a share of common stock upon consummation of our initial business combination. In the event we will not be the surviving company upon completion of our initial business combination, each holder of a right will be required to affirmatively convert his, her or its rights in order to receive the one fifth (1/5) of a share underlying each right upon consummation of the business combination. We will not issue fractional shares in connection with an exchange of rights. Fractional shares will either be rounded down to the nearest whole share or otherwise addressed in accordance with the applicable provisions of the Delaware General Corporation Law. As a result, you must hold rights in multiples of 8 in order to receive shares for all of your rights upon closing of a business combination. If we are unable to complete an initial business combination within the required time period and we redeem the public shares for the funds held in the trust account, holders of rights will not receive any of such funds for their rights and the rights will expire worthless. ____________ (1) Assumes no exercise of the underwriters over-allotment option and the forfeiture by our sponsor of an aggregate of 225,000 founder shares. (2) Consists solely of founder shares and includes up to an aggregate of 225,000 shares that are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised. Except as otherwise specified, the rest of this prospectus has been drafted to give effect to the full forfeiture of these 225,000 shares of common stock. (3) Includes 6,000,000 public shares, 340,000 private placement shares and 1,500,000 founder shares, but excludes the Representative Shares to be issued as deferred underwriting discounts to the Representative of the underwriters upon completion of our initial business combination. (4) Includes 6,000,000 public rights and 340,000 private placement rights. 9 Table of Contents Founder shares In March 2021, our sponsor paid $25,000, or approximately $0.0087 per share to cover certain of our offering and formation costs in consideration of 2,875,000 founder shares. Prior to the initial investment in the Company of $25,000 by our sponsor, the Company had no assets, tangible or intangible. The purchase price of the founder shares was determined by dividing the amount of cash contributed to us by the number of founder shares issued. The sponsor surrendered 1,150,000 shares for no consideration in January 2022. Our initial stockholders will own approximately 23.47% of our issued and outstanding shares after this offering (assuming they do not purchase units in this offering). As a result of the surrender, our sponsor purchased the founder shares at approximately $0.014 per share. The number of founder shares issued and outstanding was determined based on the expectation that the founder shares would represent 23.47% of the outstanding shares after this offering. As such, our initial stockholders will collectively own 23.47% of our issued and outstanding shares after this offering (assuming they do not purchase any units in this offering). None of our sponsor, officers or directors have expressed an intention to purchase any units in this offering. Up to an aggregate 225,000 founder shares will be subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised so that our initial stockholders will maintain ownership of 23.47% of our common stock after this offering. We will effect a stock dividend or share contribution prior to this offering should the size of the offering change, in order to maintain such ownership percentage. The founder shares are identical to the shares of common stock included in the units being sold in this offering, except that: the founder shares are subject to certain transfer restrictions, as described in more detail below; our sponsor, officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation or bylaws that would (i) modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 9 months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount) or (ii) with respect to the other provisions relating to stockholders rights or pre-business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares; 10 Table of Contents our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed (i) to waive their redemption rights with respect to their founder shares, private placement shares and public shares in connection with the completion of our initial business combination and (ii) to waive their rights to liquidating distributions from the trust account with respect to their founder shares and private placement shares if we fail to complete our initial business combination within 9 months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount) (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). If we submit our initial business combination to our public stockholders for a vote, our sponsor has agreed, pursuant to such letter agreement, to vote their founder shares and any public shares purchased during or after this offering in favor of our initial business combination. As a result, in addition to our initial stockholder s founder shares and private placement shares, we would need only 127,848, or 2.13%, of the 6,000,000 public shares sold in this offering to be voted in favor of a transaction (assuming only a quorum is present at such meeting held to vote on our initial business combination) in order to have our initial business combination approved (assuming the over-allotment option is not exercised); and the founder shares are subject to registration rights. Transfer restrictions on founder shares Our initial stockholders have agreed not to transfer, assign or sell any of their founder shares, (A) with respect to 50% of the founder shares, the earlier of six months after the date of the consummation of our initial business combination and the date on which the closing price of our common stock equals or exceeds $12.50 per share for any 20 trading days within a 30-trading day period following the consummation of our initial business combination , (B) with respect to the remaining 50% of the founder shares, six months after the date of the consummation of our initial business combination, or (C) earlier in each case if, subsequent to our initial business combination, we complete a liquidation, merger, stock exchange or other similar transaction which results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property (except as described herein under the section of this prospectus entitled Principal Stockholders Restrictions on Transfers of Founder Shares and Private Placement Units ). We refer to such transfer restrictions throughout this prospectus as the lock-up. The founder shares will be held in escrow with Continental Stock Transfer & Trust Company during the period in which they are subject to the transfer restrictions described above. 11 Table of Contents Voting Rights Holders of record of shares of the common stock and holders of founder shares will vote together on all matters submitted to a vote of our stockholders, with each share of common stock entitling the holder to one vote except as required by law. Private placement units Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 340,000 private placement units (or 371,500 if the over-allotment option is exercised in full), at a price of $10.00 per unit in a private placement that will occur simultaneously with the closing of this offering. A portion of the purchase price of the private placement units will be added to the proceeds from this offering to be held in the trust account such that, at the time of closing, $60,900,000 (or $70,035,000 if the underwriters exercise their over-allotment option in full) will be held in the trust account. Each private placement unit consists of one (1) share of common stock (the private placement share ), and one right (the private placement right ) to receive one fifth (1/5) of a share. Each placement unit is identical to the units offered by this prospectus except as described below. There will be no redemption rights or liquidating distributions from the trust account with respect to the founder shares, placement shares or placement rights, which will expire worthless if we do not consummate a business combination within 9 months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus). Our initial stockholders have agreed to waive their redemption rights with respect to their private placement shares (i) in connection with the consummation of a business combination, (ii) in connection with a stockholder vote to amend our certificate of incorporation or bylaws to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain amendments to our charter prior thereto, to redeem 100% of our public shares if we do not complete our initial business combination within 9 months from the completion of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus) or with respect to any other provision relating to stockholders rights or pre-initial business combination activity and (iii) if we fail to consummate a business combination within 9 months from the completion of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus) or if we liquidate prior to the expiration of the 9-month period (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus). However, our initial stockholder will be entitled to redemption rights with respect to any public shares held by them if we fail to consummate a business combination or liquidate within the 9-month period. If we do not complete our initial business combination within 15 months from the closing of this offering, the proceeds from the sale of the private placement units held in the trust account will be used to fund the redemption of our public shares (subject to the requirements of applicable law) and the rights included as part of the private placement units will expire worthless. 12 Table of Contents Representative s Unit Purchase Option We will sell to the Representative and/or its designees, at the time of the closing of this offering, for an aggregate of $100.00, an option (the UPO ) to purchase 50,000 units (or 57,500 if the underwriters exercise their over-allotment in full). The UPO will be exercisable at any time, in whole or in part, between the close of the business combination and the fifth anniversary of the commencement of sales of the offering at a price per unit equal to $11.50 (or 115% of the public unit offering price). Transfer restrictions on private placement units The private placement units will not be transferable, assignable or salable until 30 days after the completion of our initial business combination (except as described under the section of this prospectus entitled Principal Stockholders Restrictions on Transfers of Founder Shares and Private Placement Units ). Proceeds to be held in trust account Nasdaq rules provide that at least 90% of the gross proceeds from this offering to be deposited in a trust account. Of the net proceeds of this offering, $60,900,000, or $10.15 per unit ($70,035,000, if the underwriters over-allotment option is exercised in full) will be placed into a trust account in the United States at JPMorgan Chase, with Continental Stock Transfer & Trust Company acting as trustee, and $560,000 (regardless of the extent to which the underwriters over-allotment option is exercised) will be used to pay expenses in connection with the closing of this offering and for working capital following this offering. These proceeds to be placed in the trust account include $2,100,000 (or $2,415,000 if the underwriters over-allotment option is exercised in full) in deferred underwriting discounts. The funds in the trust account will be invested only in specified U.S. government treasury bills or in specified money market funds. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, our amended and restated certificate of incorporation provides that the proceeds from this offering will not be released from the trust account until the earliest of (a) the completion of our initial business combination, (b) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation to (i) modify the substance or timing of our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 9 months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount) or (ii) with respect to any other material provisions relating to stockholders rights or pre-initial business combination activity, and (c) the redemption of our public shares if we are unable to complete our initial business combination within 9 months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount), subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. 13 Table of Contents Anticipated expenses and funding sources Unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use, except the withdrawal of interest to pay taxes. Based upon current interest rates, we expect the trust account to generate approximately $2,100 of interest annually (assuming no exercise of the underwriters overallotment option and an interest rate of 0.10% per year) following the investment of such funds in specified U.S. government treasury bills or in specified money market funds. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement units not held in the trust account, which will be approximately $740,000 in working capital after the payment of approximately $560,000 in expenses relating to this offering and certain reimbursements to the underwriters (excluding the underwriting discounts); and any loans or additional investments from our sponsor, or its affiliates, including the promissory note (the Promissory Note ) issued to us in the principal amount of $1,000,000, provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of a business combination. As of June 30, 2022, we had drawn $400,000 under such Note. Our sponsor and its affiliates are under no obligation to advance funds or invest in us other than the funding obligations under the Promissory Note. We currently intend to draw an additional $260,000 upon the Promissory Note to fund our operations for the initial nine (9) months after the completion of this offering. Ability to extend time to complete business combination If we anticipate that we may not be able to consummate our initial business combination within 9 months, we may, by resolution of our board if requested by our sponsor, extend the period of time to consummate a business combination up to two times, each by an additional three months (for a total of up to 15 months to complete a business combination), subject to the sponsor depositing additional funds into the trust account as set out below. Pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order for the time available for us to consummate our initial business combination to be extended, our sponsor or its affiliates or designees, upon five days advance notice prior to the applicable deadline, must deposit into the trust account $900,000, or $1,035,000 if the underwriters over-allotment option is exercised in full ($0.15 per share in either case), on or prior to the date of the applicable deadline, for each of the available three month extensions providing a total possible business combination period of 15 months at a total payment value of $1,800,000, or $2,070,000 if the underwriters over-allotment option is exercised in full. Any such payments would 14 Table of Contents be made in the form of non-interest bearing loans. In the event that our sponsor or its affiliates or designees elect to extend the time to complete a business combination and deposit the applicable amount of money into trust, the sponsor will receive a non-interest bearing, unsecured promissory note equal to the amount of any such deposit that will not be repaid in the event that we are unable to close a business combination within the extended time period unless there are funds available outside the trust account to do so. Such notes would either be paid upon consummation of our initial business combination, or, at the sponsor s discretion, converted upon consummation of our business combination into additional private units at a price of $10.00 per unit. In the event that we receive notice from our sponsor five days prior to the applicable deadline of its intent to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the 9-month or 12-month deadline. In addition, we intend to issue a press release the day after the deadline announcing whether or not the funds has been timely deposited. The sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. If we are unable to consummate our initial business combination within such extended time period, we will, as promptly as possible but not more than ten business days thereafter, redeem 100% of our outstanding public shares for a pro rata portion of the funds held in the trust account, including a pro rata portion of any interest earned on the funds held in the trust account and not previously released to us to pay our taxes, and then seek to dissolve and liquidate. However, we may not be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public stockholders. In the event of our dissolution and liquidation, the private units will expire and will be worthless. Conditions to completing our initial business combination In accordance with the rules of Nasdaq, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the value of the assets held in the trust account (net of amounts disbursed to management for working capital purposes, if any, and excluding the amount of deferred underwriting discounts held in trust and taxes payable on the income earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. If our securities are not listed on the Nasdaq after this offering, we would not be required to satisfy the 80% requirement. However, we intend to satisfy the 80% requirement even if our securities are not listed on the Nasdaq at the time of our initial business combination. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. 15 Table of Contents We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. However, we may structure our initial business combination so that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders, or for other reasons. However, we will only complete an initial business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of Nasdaq s 80% of fair market value test. If the initial business combination involves more than one target business, the 80% of fair market value test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as our initial business combination for purposes of seeking stockholder approval or conducting a tender offer, as applicable. Permitted purchases of public shares by our affiliates If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, initial stockholders, directors, officers, advisors or their affiliates may purchase public shares in privately-negotiated transactions or in the open market either prior to or following the completion of our initial business combination. There is no limit on the number of shares our initial stockholders, directors, officers, advisors or their affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. 16 Table of Contents However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. Subsequent to the consummation of this offering, we will adopt an insider trading policy which will require insiders to: (i) refrain from purchasing our securities during certain blackout periods when they are in possession of any material non-public information and (ii) clear all trades of company securities with a compliance officer prior to execution. We cannot currently determine whether our insiders will make such purchases pursuant to a Rule 10b5-1 plan, as it will be dependent upon several factors, including but not limited to, the timing and size of such purchases. Depending on such circumstances, our insiders may either make such purchases pursuant to a Rule 10b5-1 plan or determine that such a plan is not necessary. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. None of the funds held in the trust account will be used to purchase shares in such transactions prior to completion of our initial business combination. See Proposed Business Permitted Purchases of Our Securities for a description of how our sponsor, initial stockholders, directors, officers, advisors or any of their affiliates will select which stockholders to purchase securities from in any private transaction. Our sponsor, directors, officers, advisors or any of their affiliates will not make any purchases if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. The purpose of any such purchases of shares could be to vote such shares in favor of the initial business combination and thereby increase the likelihood of obtaining stockholder approval of the initial business combination or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our shares of common stock may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. 17 Table of Contents Redemption rights for public stockholders upon completion of our initial business combination We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.15 per public share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by deferred underwriting discounts we will pay to the underwriters. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares held by them and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination or otherwise. Manner of conducting redemptions We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a stockholder meeting called to approve the initial business combination or (ii) without a stockholder vote by means of a tender offer. The decision as to whether we will seek stockholder approval of a proposed initial business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval under applicable law or stock exchange listing requirements. Asset acquisitions and stock purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding common stock or seek to amend our amended and restated certificate of incorporation would require stockholder approval. So long as we obtain and maintain a listing for our securities on Nasdaq, we will be required to comply with Nasdaq s stockholder approval rules. The requirement that we provide our public stockholders with the opportunity to redeem their public shares by one of the two methods listed above will be contained in provisions of our amended and restated certificate of incorporation and will apply whether or not we maintain our registration under the Exchange Act or our listing on Nasdaq. Such provisions may be amended if approved by holders of 65% of our common stock entitled to vote in-person or by proxy at a general meeting. 18 Table of Contents If we provide our public stockholders with the opportunity to redeem their public shares in connection with a stockholder meeting, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and file proxy materials with the SEC. If we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the Company representing a majority of the voting power of all outstanding shares of capital stock of the Company entitled to vote at such meeting. Our initial stockholders will count towards this quorum and, pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote their founder shares and any public shares purchased during or after this offering (including in open market and privately-negotiated transactions) in favor of our initial business combination. For purposes of seeking approval of the majority of our outstanding shares of common stock voted, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. As a result, in addition to our initial stockholders founder shares and private placement shares, we would need only 127,848, or 2.13% of the public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming all outstanding shares are voted and the over-allotment option is not exercised). We intend to give not less than 10 days nor more than 60 days prior written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination. These quorum and voting thresholds, and the voting agreements of our initial stockholders, may make it more likely that we will consummate our initial business combination. Each public stockholder may elect to redeem its public shares irrespective of whether they vote for or against the proposed transaction or whether they were a stockholder on the record date for the stockholder meeting held to approve the proposed transaction. If a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other legal reasons, we will: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and file tender offer documents with the SEC prior to completing our initial business combination, which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. 19 Table of Contents In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public stockholders not tendering more than a specified number of public shares, which number will be based on the requirement that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of deferred underwriting discounts (so that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement that may be contained in the agreement relating to our initial business combination. If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase shares of our Common stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act. We intend to require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to, at the holder s option, either deliver their stock certificates to our transfer agent or deliver their shares to our transfer agent electronically using the Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) system, prior to the date set forth in the proxy materials or tender offer documents, as applicable. In the case of proxy materials, this date may be up to two business days prior to the vote on the proposal to approve the initial business combination. In addition, if we conduct redemptions in connection with a stockholder vote, we intend to require a public stockholder seeking redemption of its public shares to also submit a written request for redemption to our transfer agent two business days prior to the vote in which the name of the beneficial owner of such shares is included. The proxy materials or tender offer documents, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public stockholders to satisfy such delivery requirements. We believe that this will allow our transfer agent to efficiently process any redemptions without the need for further communication or action from the redeeming public stockholders, which could delay redemptions and result in additional administrative cost. If the proposed initial business combination is not approved and we continue to search for a target company, we will promptly return any certificates or shares delivered by public stockholders who elected to redeem their shares. 20 Table of Contents Our amended and restated certificate of incorporation will provide that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of deferred underwriting discounts (so that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. For example, the proposed initial business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed initial business combination. In the event the aggregate cash consideration we would be required to pay for all shares of common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will not complete the initial business combination or redeem any shares, and all shares of common stock submitted for redemption will be returned to the holders thereof. Limitation on redemption rights of stockholders holding more than 15% of the shares sold in this offering if we hold stockholder vote Notwithstanding the foregoing redemption rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. We believe the restriction described above will discourage stockholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public stockholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against an initial business combination if such holder s shares are not purchased by us or our management at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with an initial business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders ability to vote all of their shares (including all shares held by those stockholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. 21 Table of Contents Redemption Rights in connection with proposed amendments to our amended and restated certificate of incorporation Our amended and restated certificate of incorporation will provide that any of its provisions, including those related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the private placement units into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein and in our amended and restated certificate of incorporation), may be amended if approved by holders of at least 65% of our common stock who attend and vote in person or by proxy at a general meeting, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of 65% of our shares of common stock who vote in person or by proxy at a general meeting. Should our sponsor vote all its shares in favor of any such amendment, we would require 713,096, or 11.88%, of the public shares issued in this offering to be voted in favor of any such amendment for its approval (assuming no exercise of the underwriters overallotment option and no purchase by our sponsor or its affiliates or our officers and directors or their respective affiliates of public shares in this offering or thereafter). We may not issue additional securities that can vote on amendments to our amended and restated certificate of incorporation or in our initial business combination. Our initial stockholders, which will beneficially own 23.47% of our shares of common stock upon the closing of this offering (assuming it does not purchase units in this offering), will participate in any vote to amend our amended and restated certificate of incorporation and/or trust agreement and will have the discretion to vote in any manner it chooses. Our sponsor, officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation that would (i) modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 9 months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus) or (ii) with respect to the other provisions relating to stockholders rights or pre-business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares, private placement shares and public shares in connection with the completion of our initial business combination. 22 Table of Contents Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be used to pay amounts due to any public stockholders who exercise their redemption rights as described above under Redemption rights for public stockholders upon completion of our initial business combination. We will use the remaining funds to pay the underwriters their deferred underwriting discounts, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or used for redemption of our public shares, we may use the balance of the cash released to us from the trust account following the closing for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our amended and restated certificate of incorporation will provide that we will have only 9 months from the closing of this offering to complete our initial business combination (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount). If we are unable to complete our initial business combination within such 15-month period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $2,100 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. In the event that our sponsor or its affiliates or designees, elect to extend the time to complete a business combination and deposit the applicable amount of money into trust, the sponsor would receive a non-interest bearing, unsecured promissory note equal to the amount of any such deposit that will not be repaid in the event that we are unable to close a business combination unless there are funds available outside the trust account to do so. Such notes would either be paid upon consummation of our initial business combination, or, at the sponsor s discretion, converted upon consummation of our business combination into additional private units at a price of $10.00 per unit. In the event that we receive notice from our sponsor five days 23 Table of Contents prior to the applicable deadline of its intent to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the 9-month or 12-month deadline. In addition, we intend to issue a press release the day after the deadline announcing whether or not the funds had been timely deposited. The sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. To the extent that some, but not all, of the sponsor, decides to extend the period of time to consummate our initial business combination, the sponsor (or its affiliates or designees) may deposit the entire amount required. If we are unable to consummate our initial business combination within such time period, we will, as promptly as possible but not more than ten business days thereafter, redeem 100% of our outstanding public shares for a pro rata portion of the funds held in the trust account, including a pro rata portion of any interest earned on the funds held in the trust account and not previously released to us to pay our taxes, and then seek to dissolve and liquidate. However, we may not be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public stockholders. In the event of our dissolution and liquidation, the private units will expire and will be worthless. Our sponsor, officers and directors will enter into a letter agreement with us, pursuant to which they will waive their rights to liquidating distributions from the trust account with respect to any founder shares held by them if we fail to complete our initial business combination within 9 months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount). However, if our initial stockholders acquire public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted 15-month time period. The underwriters have agreed to waive their rights to their deferred underwriting discounts held in the trust account in the event we do not complete our initial business combination and subsequently liquidate and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. Limited payments to insiders There will be no finder s fees, reimbursement, consulting fee, non-cash payments, monies in respect of any payment of a loan or other compensation paid by us to our sponsor, officers or directors, or any affiliate of our sponsor or officers, prior to, or in connection with any services rendered in order to effectuate, the consummation of our initial business combination (regardless of the type of transaction that it is). However, the following payments may be made to our sponsor, officers or directors, or our or their affiliates, none of which will be made from the proceeds of this offering held in the trust account prior to or upon the completion of our initial business combination: Payment to our affiliate of $20,000 per month, for up to 9 months (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount), for office space, utilities and secretarial and administrative support; Reimbursement for any out-of-pocket expenses related to identifying, investigating, negotiating and completing an initial business combination; and 24 Table of Contents Repayment of loans which may be made by our sponsor or an affiliate of our sponsor to finance transaction costs in connection with the public offering and an intended initial business combination pursuant to the Promissory Note issued by the Company detailing the terms of such working capital loans by our sponsor or its affiliates. Up to $1,000,000 of such loans provided pursuant to the Promissory Note may be converted into units, each unit comprised of one share of our common stock and one right to receive one fifth (1/5) of a share of the common stock (the Conversion Right ), at the price of $10.00 per unit at the option of the lender. The terms and conditions of each Conversion Right shall be identical to the rights offered by this prospectus except that the Conversion Rights are not registered under this prospectus. As of June 30, 2022, we had borrowed a total of $400,000 under the Promissory Note with our sponsor to be used for a portion of the expenses of this offering. We currently intend to draw an additional $260,000 upon the Promissory Note to fund our operations for the initial nine (9) months after the completion of this offering. These payments may be funded using the net proceeds of this offering and the sale of the private placement units not held in the trust account or, upon completion of the initial business combination, from any amounts remaining from the proceeds of the trust account released to us in connection therewith. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliate. Audit Committee We have established and will maintain an audit committee to, among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section of this prospectus entitled Management Committees of the Board of Directors Audit Committee. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliates. Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business with which we have entered into a written letter of intent, confidentiality or similar agreement or business combination agreement, reduce the amount of funds in the trust account to below (i) $10.15 per public share or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes; provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether or not such waiver is enforceable), nor will it apply to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. 25 Table of Contents In the event an excise tax and/or any other similar fees or taxes in nature are levied or imposed on us pursuant to any current, pending or future rule(s) or law(s), including without limitation any excise tax imposed under the Inflation Reduction Act of 2022 in relation to a redemption of securities as described in the registration statement or otherwise, and such tax or fee has not been paid by us to the applicable regulatory authority on or prior to the due date for such a tax or fee, the Company and Sponsor agree to promptly pay such tax or fee (but in any event sufficiently prior to the due date for such tax or fee to assure timely payment thereof), by either the Company paying such taxes or the Sponsor directly paying such tax or fee on behalf of the Company, or advancing to the Company such funds as necessary and appropriate to allow the Company to pay such tax or fee timely. The Company and the Sponsor agree not to seek recourse for such expenses from the trust account. However, we have not asked our sponsor to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations, and believe that our sponsor s only assets are securities of our company. Therefore, we cannot assure you that our sponsor would be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties, including, without limitation, claims by vendors and prospective target businesses. Conflicts of Interest Each of our officers and directors presently has, and in the future any of our directors and our officers may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present acquisition opportunities to such entity. Accordingly, subject to his or her fiduciary duties under Delaware law, if any of our officers or directors becomes aware of an acquisition opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she will need to honor his or her fiduciary or contractual obligations to present such acquisition opportunity to such entity, and only present it to us if such entity rejects the opportunity. Our amended and restated certificate of incorporation provides that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and us, on the other. We do not believe, however, that any fiduciary duties or contractual obligations of our directors or officers would materially undermine our ability to complete our business combination. Risks We are a blank check company that has conducted no operations and has generated no revenues to date. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision whether to invest in our securities, you should take into account not only the background of our management team, but also the special risks we face as a blank check company. This offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see the section of this prospectus entitled Proposed Business Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419. You should carefully consider these and the other risks set forth in the section of this prospectus entitled Risk Factors beginning on page 29 of this prospectus. 26 Table of Contents SUMMARY FINANCIAL DATA The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. June 30, 2022 Actual As Adjusted Balance Sheet Data: Working capital (deficit)(1) $ (453,305 ) $ (124,635 ) Total assets(2) 472,678 62,112,678 Total liabilities(3) 514,653 2,990,253 Value of shares of common stock subject to possible redemption(4) (60,900,000 ) Stockholders equity(5) (41,975 ) (1,777,575 ) ____________ (1) The as adjusted calculation includes the cash held in trust from the proceeds of the placement units, plus $740,000 of cash available outside of the trust, plus $(41,975) of actual stockholder s equity as of June 30, 2022, less $2,100,000 of deferred underwriting discounts. (2) The as adjusted calculation equals $60,900,000 cash held in trust from the proceeds of this offering and the sale of the placement units, plus $740,000 of cash available outside of the trust, plus $(41,975) of actual stockholder s equity as of June 30, 2022. (3) The as adjusted calculation includes $2,100,000 of deferred underwriting discounts. (4) The as adjusted calculation equals the as adjusted total assets, less the as adjusted total liabilities, less the as adjusted stockholders equity. (5) Excludes 6,000,000 public shares which are subject to redemption in connection with our initial business combination. The as adjusted calculation equals the as adjusted total assets, less the as adjusted total liabilities, less the value of shares of common stock that may be redeemed in connection with our initial business combination (initially $10.15 per share). The actual number of public shares that may be redeemed may exceed the aforementioned amount provided that we will not consummate an initial business combination unless we satisfy the $5,000,001 minimum net tangible assets threshold. The as adjusted information gives effect to the sale of the units in this offering, the sale of the placement units, and the payment of the estimated expenses of this offering and assumes no exercise of the underwriters over-allotment option. The as adjusted total assets amount includes the $60,900,000 held in the trust account (which would be $70,035,000 if the underwriters over-allotment option is exercised in full) for the benefit of our public stockholders, which amount, less deferred underwriting discounts, will be available to us only upon the completion of our initial business combination within the completion window. The as adjusted total assets include $2,100,000 being held in the trust account (which would be $2,415,000 if the underwriters over-allotment option is exercised in full) representing deferred underwriting discounts. The underwriters will not be entitled to any interest accrued on the deferred underwriting discounts. If no business combination is completed within 9 months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount), the proceeds then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less $2,100 of interest to pay dissolution expenses), will be used to fund the redemption of our public shares. In the event that our sponsor or its affiliates or designees, elects to extend the time to complete a business combination and deposit the applicable amount of money into trust, the sponsor will receive a non-interest bearing, unsecured promissory note equal to the amount of any such deposit that will not be repaid in the event that we are unable to close a business combination unless there are funds available outside the trust account to do so. Such notes would either be paid upon consummation of our initial business combination, or, at the sponsor s discretion, converted upon consummation of our business combination into additional private units at a price of $10.00 per unit. In the event that we receive notice from our sponsor five days prior to the applicable deadline of its intent to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the 9-month or 12-month deadline. In addition, we intend to issue a press release the day after the deadline announcing whether or not the funds had been timely deposited. The sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. If we are unable to consummate our initial business combination within such time period, we will, as promptly as possible but not more than ten business days thereafter, redeem 100% of our outstanding public shares for a pro rata portion of the funds held in the trust account, including a pro rata portion of any interest earned 27 Table of Contents on the funds held in the trust account and not previously released to us to pay our taxes, and then seek to dissolve and liquidate. However, we may not be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public stockholders. In the event of our dissolution and liquidation, the private units will expire and will be worthless. Our sponsor, directors, director nominees and officers will enter into a letter agreement with us, pursuant to which they have agreed to waive their rights to liquidating distributions from the trust account with respect to any founder shares held by them if we fail to complete our initial business combination within such time period. 28 Table of Contents
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001853112_genesis_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001853112_genesis_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..478216c6d281a9ed61d5f09e68a997f78e56c9e2
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001853112_genesis_prospectus_summary.txt
@@ -0,0 +1,9818 @@
+Summary
+Financial Data
+
+ 
+
+The
+following table summarizes the relevant financial data for our business as of September 30, 2021 on an actual basis and as adjusted
+to give effect to the sale of the units in this offering, the sale of the placement units and the other transactions described below
+as if they had occurred on that date, and should be read with our financial statements, which are included in this prospectus. We
+have not had any significant operations to date, so only balance sheet data is presented. 
+
+ 
+
+ 
+ 
+ September 30,
+ 2021 
+
+ 
+ 
+ Actual 
+ As
+ Adjusted 
+
+ 
+ Balance Sheet Data: 
+ 
+ 
+
+ 
+ Working capital deficiency 
+ $99,148 
+ $74,645,722 
+
+ 
+ Total assets 
+ $117,200 
+ $77,083,222 
+
+ 
+ Total liabilities 
+ $108,978 
+ $2,437,500 
+
+ 
+ Stockholders equity (deficit) 
+ $8,222 
+ $(1,479,278)
+
+ 
+ Value of Class A common stock subject to redemption 
+ $- 
+ $76,125,000 
+
+ 
+
+ 
+
+ 30
+
+ 
+
+ 
+
+ 
+
+RISK
+FACTORS
+
+ 
+
+An
+investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together
+with the other information contained in this prospectus, before making a decision to invest in our units. If any of the following events
+occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price
+of our securities could decline, and you could lose all or part of your investment.
+
+ 
+
+Risks
+Relating to our Search for, Consummation of, or Inability to Consummate, a Business Combination and Post-Business Combination Risks
+
+ 
+
+Our
+search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially
+adversely affected by the recent coronavirus (COVID-19) pandemic.
+
+ 
+
+The
+COVID-19 pandemic has resulted in a widespread health crisis that has adversely affected the economies and financial markets worldwide,
+and the business of any potential target business with which we consummate a business combination could be materially and adversely affected.
+Furthermore, we may be unable to complete a business combination if continued concerns relating to COVID-19 restrict travel, limit the
+ability to have meetings with potential investors or the target company s personnel, vendors and services providers are unavailable
+to negotiate and consummate a transaction in a timely manner. The extent to which COVID-19 impacts our search for a business combination
+will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning
+the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others. If the disruptions posed by COVID-19
+or other matters of global concern continue for an extensive period of time, our ability to consummate a business combination, or the
+operations of a target business with which we ultimately consummate a business combination, may be materially adversely affected.
+
+ 
+
+As
+the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there
+may be more competition for attractive targets. This could increase the cost of our initial business combination and could even
+result in our inability to find a target or to consummate an initial business combination.
+
+ 
+
+In
+recent years, the number of special purpose acquisition companies that have been formed has increased substantially. Many potential targets
+for special purpose acquisition companies have already entered into an initial business combination, and there are still many special
+purpose acquisition companies seeking targets for their initial business combination, as well as many such companies currently in registration.
+As a result, at times, fewer attractive targets may be available, and it may require more time, more effort and more resources to identify
+a suitable target and to consummate an initial business combination.
+
+ 
+
+In
+addition, because there are more special purpose acquisition companies seeking to enter into an initial business combination with available
+targets, the competition for available targets with attractive fundamentals or business models may increase, which could cause target
+companies to demand improved financial terms.
+
+ 
+
+Attractive
+deals could also become scarcer for other reasons, such as economic or industry sector downturns, geopolitical tensions, or increases
+in the cost of additional capital needed to close business combinations or operate targets post-business combination. This could increase
+the cost of, delay or otherwise complicate or frustrate our ability to find and consummate an initial business combination, and may result
+in our inability to consummate an initial business combination on terms favorable to our investors altogether.
+
+ 
+
+ 31
+
+ 
+
+ 
+
+ 
+
+Our
+public stockholders may not be afforded an opportunity to vote on our proposed initial business combination, which means we may complete
+our initial business combination even though a majority of our public stockholders do not support such a combination.
+
+ 
+
+We
+may choose not to hold a stockholder vote to approve our initial business combination unless the initial business combination would require
+stockholder approval under applicable law or stock exchange listing requirements or if we decide to hold a stockholder vote for business
+or other legal reasons. Except as required by applicable law or stock exchange requirements, the decision as to whether we will seek
+stockholder approval of a proposed initial business combination or will allow stockholders to sell their shares to us in a tender offer
+will be made by us, solely in our discretion, and will be based on a variety of factors, such as the timing of the transaction and whether
+the terms of the transaction would otherwise require us to seek stockholder approval. Accordingly, we may complete our initial business
+combination even if holders of a majority of our public shares do not approve of the initial business combination we complete. Please
+see the section of this prospectus entitled "Proposed Business — Stockholders May Not Have the Ability to Approve Our Initial
+Business Combination" for additional information.
+
+ 
+
+If
+we seek stockholder approval of our initial business combination, our initial stockholders have agreed to vote in favor of such initial
+business combination, regardless of how our public stockholders vote.
+
+ 
+
+Pursuant to the letter agreement,
+our sponsor, officers and directors have agreed to vote any founder shares and placement shares held by them, as well as any public shares
+they may acquire during or after this offering (including in open market and privately negotiated transactions), in favor of our initial
+business combination. As a result, in addition to our initial stockholders founder shares, and placement shares, we would need
+only 218,331, or 2.9%, of the 7,500,000 public shares sold in this offering to be voted in favor of an initial business
+combination (assuming only the minimum number of shares representing a quorum are voted, and that the initial stockholders do
+not purchase any units in this offering or units or shares in the after-market) in order to have our initial business combination approved
+(assuming the over-allotment option is not exercised). Our initial stockholders will own shares representing approximately 22.8%
+of our outstanding shares of common stock immediately following the completion of this offering and the private placement (including
+the placement shares to be issued to the sponsor and assuming they do not purchase any units in this offering). Accordingly, if we seek
+stockholder approval of our initial business combination, the agreement by our initial stockholders to vote in favor of our initial business
+combination will increase the likelihood that we will receive the requisite stockholder approval for such initial business combination.
+
+ 
+
+Your
+only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your
+right to redeem your shares from us for cash, unless we seek stockholder approval of the initial business combination.
+
+ 
+
+At
+the time of your investment in us, you will not be provided with an opportunity to evaluate the specific merits or risks of our initial
+business combination. Since our board of directors may complete an initial business combination without seeking stockholder approval,
+public stockholders may not have the right or opportunity to vote on the initial business combination, unless we seek such stockholder
+vote. Accordingly, if we do not seek stockholder approval, your only opportunity to affect the investment decision regarding a potential
+business combination may be limited to exercising your redemption rights within the period of time (which will be at least 20 business
+days) set forth in our tender offer documents mailed to our public stockholders in which we describe our initial business combination.
+
+ 
+
+The
+ability of our public stockholders to redeem their shares for cash may make our financial condition unattractive to potential business
+combination targets, which may make it difficult for us to enter into an initial business combination with a target.
+
+ 
+
+We
+may seek to enter into an initial business combination agreement with a prospective target that requires as a closing condition that
+we have a minimum net worth or a certain amount of cash. If too many public stockholders exercise their redemption rights, we would not
+be able to meet such closing condition and, as a result, would not be able to proceed with the initial business combination. Furthermore,
+in no event will we redeem our public shares unless our net tangible assets are at least $5,000,001 either immediately prior to or upon
+consummation of our initial business combination and after payment of underwriters fees and commissions (so that we are not subject
+to the SEC s "penny stock" rules) or any greater net tangible asset or cash requirement which may be contained in the
+agreement relating to our initial business combination. Consequently, if accepting all properly submitted redemption requests would cause
+our net tangible assets to be less than $5,000,001 upon consummation of our initial business combination and after payment of underwriters 
+fees and commissions or such greater amount necessary to satisfy a closing condition, each as described above, we would not proceed with
+such redemption and the related business combination and may instead search for an alternate business combination. Prospective targets
+will be aware of these risks and, thus, may be reluctant to enter into an initial business combination with us.
+
+ 
+
+ 32
+
+ 
+
+ 
+
+ 
+
+The
+ability of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete
+the most desirable business combination or optimize our capital structure.
+
+ 
+
+At
+the time we enter into an agreement for our initial business combination, we will not know how many stockholders may exercise their redemption
+rights, and therefore will need to structure the transaction based on our expectations as to the number of shares that will be submitted
+for redemption. If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the
+purchase price, or requires us to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the trust
+account to meet such requirements, or arrange for third party financing. In addition, if a larger number of shares are submitted for
+redemption than we initially expected, we may need to restructure the transaction to reserve a greater portion of the cash in the trust
+account or arrange for third party financing. Raising additional third-party financing may involve dilutive equity issuances or the incurrence
+of indebtedness at higher than desirable levels. Furthermore, this dilution would increase to the extent that the anti-dilution provision
+of the Class B common stock result in the issuance of Class A shares on a greater than one-to-one basis upon conversion of the Class
+B common stock at the time of the consummation of our business combination. The above considerations may limit our ability to complete
+the most desirable business combination available to us or optimize our capital structure. The amount of the deferred underwriting commissions
+payable to the underwriters will not be adjusted for any shares that are redeemed in connection with an initial business combination.
+The per-share amount we will distribute to stockholders who properly exercise their redemption rights will not be reduced by the deferred
+underwriting commission and after such redemptions, the per-share value of shares held by non-redeeming stockholders will reflect our
+obligation to pay the deferred underwriting commissions.
+
+ 
+
+The
+ability of our public stockholders to exercise redemption rights with respect to a large number of our shares could increase the probability
+that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your stock.
+
+ 
+
+If
+our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or
+requires us to have a minimum amount of cash at closing, the probability that our initial business combination would be unsuccessful
+is increased. If our initial business combination is unsuccessful, you would not receive your pro rata portion of the trust account until
+we liquidate the trust account. If you are in need of immediate liquidity, you could attempt to sell your stock in the open market; however,
+at such time our stock may trade at a discount to the pro rata amount per share in the trust account. In either situation, you may suffer
+a material loss on your investment or lose the benefit of funds expected in connection with our redemption until we liquidate or you
+are able to sell your stock in the open market.
+
+ 
+
+The
+requirement that we complete our initial business combination within the prescribed time frame may give potential target businesses leverage
+over us in negotiating an initial business combination and may decrease our ability to conduct due diligence on potential business combination
+targets as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms
+that would produce value for our stockholders.
+
+ 
+
+Any potential target business
+with which we enter into negotiations concerning an initial business combination will be aware that we must execute a definitive
+agreement to complete an initial business combination within 12 months from the closing of this offering (or up to 18 months
+from the closing of this offering if extended as described elsewhere in this prospectus). Consequently, such target business may
+obtain leverage over us in negotiating an initial business combination, knowing that if we do not complete our initial business
+combination with that particular target business, we may be unable to complete our initial business combination with any target
+business. This risk will increase as we get closer to the timeframe described above. In addition, we may have limited time to
+conduct due diligence and may enter into our initial business combination on terms that we would have rejected upon a more
+comprehensive investigation.
+
+ 
+
+ 33
+
+ 
+
+ 
+
+ 
+
+We
+may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all operations
+except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public stockholders may only
+receive $10.15 per share, or less than such amount in certain circumstances, and our warrants will expire worthless.
+
+ 
+
+Our amended and restated certificate
+of incorporation will provide that (i) we will have only 12 months from the closing of this offering to complete an initial business
+combination (or up to 18 months from the closing of this offering if extended as described elsewhere in this prospectus). We may
+not be able to find a suitable target business and complete our initial business combination within such time period. Our ability to
+complete our initial business combination may be negatively impacted by general market conditions, volatility in the capital and debt
+markets and the other risks described herein. For example, if the outbreak of COVID-19 continues to grow both in the U.S. and globally
+and, while the extent of the impact of the outbreak on us will depend on future developments, it could limit our ability to complete
+our initial business combination, including as a result of increased market volatility, decreased market liquidity and third-party financing
+being unavailable on terms acceptable to us or at all. Additionally, the outbreak of COVID-19 may negatively impact businesses we may
+seek to acquire.
+
+ 
+
+If
+we have not completed our initial business combination within such time period, we will: (i) cease all operations except for the purpose
+of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a
+per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the
+funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution
+expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders 
+rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii)
+as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of
+directors, dissolve and liquidate, subject in the case of clauses (ii) and (iii) above to our obligations under Delaware law to provide
+for claims of creditors and the requirements of other applicable law. In such case, our public stockholders may only receive $10.15
+per share, and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than $10.15
+per share on the redemption of their shares. See "— If third parties bring claims against us, the proceeds held in the
+trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.15 per share"
+and other risk factors below.
+
+ 
+
+If
+we seek stockholder approval of our initial business combination, our sponsor, directors, officers and their affiliates may elect to
+purchase shares or warrants from public stockholders, which may influence a vote on a proposed initial business combination and reduce
+the public "float" of our Class A common stock.
+
+ 
+
+If
+we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
+combination pursuant to the tender offer rules, our sponsor, directors, officers or their affiliates may purchase public shares or public
+warrants or a combination thereof in privately negotiated transactions or in the open market either prior to or following the completion
+of our initial business combination, although they are under no obligation to do so. However, they have no current commitments, plans
+or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds
+in the trust account will be used to purchase shares or public warrants in such transactions.
+
+ 
+
+Such
+a purchase may include a contractual acknowledgement that such stockholder, although still the record holder of our shares is no longer
+the beneficial owner thereof and therefore agrees not to exercise its redemption rights. In the event that our sponsor, directors, officers
+or their affiliates purchase shares in privately negotiated transactions from public stockholders who have already elected to exercise
+their redemption rights or submitted a proxy to vote against our initial business combination, such selling stockholders would be required
+to revoke their prior elections to redeem their shares and any proxy to vote against our initial business combination. The price per
+share paid in any such transaction may be different than the amount per share a public stockholder would receive if it elected to redeem
+its shares in connection with our initial business combination. The purpose of such purchases could be to vote such shares in favor of
+the initial business combination and thereby increase the likelihood of obtaining stockholder approval of the initial business combination,
+or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash
+at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of
+any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters
+submitted to the warrant holders for approval in connection with our initial business combination.
+
+ 
+
+ 34
+
+ 
+
+ 
+
+ 
+
+Any
+such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible.
+We expect that any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers
+are subject to such reporting requirements.
+
+ 
+
+In
+addition, if such purchases are made, the public "float" of our Class A common stock or public warrants and the number of
+beneficial holders of our securities may be reduced, possibly making it difficult to obtain or maintain the quotation, listing or trading
+of our securities on a national securities exchange.
+
+ 
+
+If
+a stockholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or
+fails to comply with the procedures for tendering its shares, such shares may not be redeemed.
+
+ 
+
+We
+will comply with the tender offer rules or proxy rules, as applicable, when conducting redemptions in connection with our initial business
+combination. Despite our compliance with these rules, if a stockholder fails to receive our tender offer or proxy materials, as applicable,
+such stockholder may not become aware of the opportunity to redeem its shares. In addition, proxy materials or tender offer documents,
+as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will describe
+the various procedures that must be complied with in order to validly tender or redeem public shares. For example, we may require our
+public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in "street
+name," to either deliver their stock certificates to our transfer agent prior to the date set forth in the tender offer documents
+mailed to such holders, or up to two business days prior to the vote on the proposal to approve the initial business combination in the
+event we distribute proxy materials, or to deliver their shares to the transfer agent electronically. In the event that a stockholder
+fails to comply with these or any other procedures disclosed in the proxy or tender offer materials, as applicable, its shares may not
+be redeemed. See the section of this prospectus entitled "Proposed Business — Redemption Rights for Public Stockholders upon
+Completion of our Initial Business Combination — Tendering Stock Certificates in Connection with a Tender Offer or Redemption Rights."
+
+ 
+
+You
+will not have any rights or interests in funds from the trust account, except under certain limited circumstances. To liquidate your
+investment, therefore, you may be forced to sell your public shares or warrants, potentially at a loss.
+
+ 
+
+Our public stockholders will be
+entitled to receive funds from the trust account only upon the earliest to occur of: (i) our completion of an initial business combination,
+and then only in connection with those shares of Class A common stock that such stockholder properly elected to redeem, subject to the
+limitations described herein, (ii) the redemption of any public shares properly submitted in connection with a stockholder vote to amend
+our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in
+connection with our initial business combination or certain amendments to our amended and restated certificate of incorporation prior
+thereto or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the
+closing of this offering (or up to 18 months from the closing of this offering if extended as described elsewhere in this prospectus)
+or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity and (iii)
+the redemption of our public shares if we are unable to complete an initial business combination within 12 months from the closing of
+this offering (or up to 18 months from the closing of this offering if extended as described elsewhere in this prospectus), subject
+to applicable law and as further described herein. In no other circumstances will a public stockholder have any right or interest of
+any kind in the trust account. Holders of warrants will not have any right to the proceeds held in the trust account with respect to
+the warrants. Accordingly, to liquidate your investment, you may be forced to sell your public shares or warrants, potentially at a loss.
+
+ 
+
+You
+will not be entitled to protections normally afforded to investors of many other blank check companies.
+
+ 
+
+Since
+the net proceeds of this offering and the sale of the placement units are intended to be used to complete an initial business combination
+with a target business that has not been identified, we may be deemed to be a "blank check" company under the United States
+securities laws. However, because we will have net tangible assets in excess of $5,000,000 upon the successful completion of this offering
+and the sale of the placement units and will file a Current Report on Form 8-K, including an audited balance sheet demonstrating this
+fact, we are exempt from rules promulgated by the SEC to protect investors in blank check companies, such as Rule 419. Accordingly, investors
+will not be afforded the benefits or protections of those rules. Among other things, this means our units will be immediately tradable
+and we will have a longer period of time to complete our business combination than do companies subject to Rule 419. Moreover, if this
+offering were subject to Rule 419, that rule would prohibit the release of any interest earned on funds held in the trust account to
+us unless and until the funds in the trust account were released to us in connection with our completion of an initial business combination.
+For a more detailed comparison of our offering to offerings that comply with Rule 419, please see the section of this prospectus entitled
+"Proposed Business — Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419."
+
+ 
+
+ 35
+
+ 
+
+ 
+
+ 
+
+Because
+of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete
+our initial business combination. If we are unable to complete our initial business combination, our public stockholders may receive
+only approximately $10.15 per share on our redemption of our public shares, or less than such amount in certain circumstances,
+and our warrants will expire worthless.
+
+ 
+
+We
+expect to encounter intense competition from other entities having a business objective similar to ours, including private investors
+(which may be individuals or investment partnerships), other blank check companies and other entities competing for the types of businesses
+we intend to acquire. Many of these individuals and entities are well-established and have extensive experience in identifying and effecting,
+directly or indirectly, acquisitions of companies operating in or providing services to various industries. Many of these competitors
+possess greater technical, human and other resources or more industry knowledge than we do, and our financial resources will be relatively
+limited when contrasted with those of many of these competitors. While we believe there are numerous target businesses we could potentially
+acquire with the net proceeds of this offering and the sale of the placement units, our ability to compete with respect to the acquisition
+of certain target businesses that are sizable will be limited by our available financial resources. This inherent competitive limitation
+gives others an advantage in pursuing the acquisition of certain target businesses. Furthermore, because we are obligated to pay cash
+for the shares of Class A common stock which our public stockholders redeem in connection with our initial business combination, target
+companies will be aware that this may reduce the resources available to us for our initial business combination. This may place us at
+a competitive disadvantage in successfully negotiating and completing an initial business combination. If we are unable to complete our
+initial business combination, our public stockholders may receive only approximately $10.15 per share on the liquidation of our
+trust account and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than $10.15
+per share upon our liquidation. See "— If third parties bring claims against us, the proceeds held in the trust account
+could be reduced and the per-share redemption amount received by stockholders may be less than $10.15 per share" and other
+risk factors herein.
+
+ 
+
+If
+the net proceeds of this offering and the sale of the placement units not being held in the trust account are insufficient to allow us
+to operate for at least the 12 months following the closing of this offering, we may be unable to complete our initial business
+combination, in which case our public stockholders may only receive $10.15 per share, or less than such amount in certain circumstances,
+and our warrants will expire worthless.
+
+ 
+
+The
+funds available to us outside of the trust account to fund our working capital requirements may not be sufficient to allow us to operate
+for at least the 12 months following the closing of this offering, assuming that our initial business combination is not completed
+during that time. We believe that, upon the closing of this offering, the funds available to us outside of the trust account will be
+sufficient to allow us to operate for at least the 12 months following such closing; however, we cannot assure you that our estimate
+is accurate. Of the funds available to us, we could use a portion of the funds available to us to pay fees to consultants to assist us
+with our search for a target business. We could also use a portion of the funds as a down payment or to fund a "no-shop"
+provision (a provision in letters of intent or merger agreements designed to keep target businesses from "shopping" around
+for transactions with other companies or investors on terms more favorable to such target businesses) with respect to a particular proposed
+initial business combination, although we do not have any current intention to do so. If we entered into a letter of intent or merger
+agreement where we paid for the right to receive exclusivity from a target business and were subsequently required to forfeit such funds
+(whether as a result of our breach or otherwise), we might not have sufficient funds to continue searching for, or conduct due diligence
+with respect to, a target business. If we are unable to complete our initial business combination, our public stockholders may receive
+only approximately $10.15 per share on the liquidation of our trust account and our warrants will expire worthless. In certain circumstances,
+our public stockholders may receive less than $10.15 per share upon our liquidation. See "— If third parties bring claims
+against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may
+be less than $10.15 per share" and other risk factors herein.
+
+ 
+
+If
+the net proceeds of this offering and the sale of the placement units not being held in the trust account are insufficient, it could
+limit the amount available to fund our search for a target business or businesses and complete our initial business combination and we
+will depend on loans from our sponsor or management team to fund our search for an initial business combination, to pay our taxes and
+to complete our initial business combination. If we are unable to obtain these loans, we may be unable to complete our initial business
+combination.
+
+ 
+
+Of the net proceeds of this offering
+and the sale of the placement units, only approximately $950,000 will be available to us initially outside the trust account to
+fund our working capital requirements. In the event that our offering expenses exceed our estimate of $451,435, we may fund such excess
+with funds not to be held in the trust account. In such case, the amount of funds we intend to be held outside the trust account would
+decrease by a corresponding amount. The amount held in the trust account will not be impacted as a result of such increase or decrease.
+Conversely, in the event that the offering expenses are less than our estimate of $451,435, the amount of funds we intend to be held
+outside the trust account would increase by a corresponding amount. If we are required to seek additional capital, we would need to borrow
+funds from our sponsor, management team or other third parties to operate or may be forced to liquidate. None of our sponsor, members
+of our management team nor any of their affiliates is under any obligation to advance funds to us in such circumstances. Any such advances
+would be repaid only from funds held outside the trust account or from funds released to us upon completion of our initial business combination.
+Up to $1,500,000 of such loans may be convertible into units, at a price of $10.00 per unit at the option of the lender, upon consummation
+of our initial business combination. The units would be identical to the placement units. Prior to the completion of our initial business
+combination, we do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not believe third
+parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our trust account.
+If we are unable to obtain these loans, we may be unable to complete our initial business combination. If we are unable to complete our
+initial business combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate
+the trust account. Consequently, our public stockholders may only receive approximately $10.15 per share on our redemption of our public
+shares, and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than $10.15 per share
+on the redemption of their shares. See "— If third parties bring claims against us, the proceeds held in the trust account
+could be reduced and the per-share redemption amount received by stockholders may be less than $10.15 per share" and other risk
+factors below. 
+
+Subsequent
+to the completion of our initial business combination, we may be required to take write-downs or write-offs, restructuring and impairment
+or other charges that could have a significant negative effect on our financial condition, results of operations and our stock price,
+which could cause you to lose some or all of your investment.
+
+ 
+
+Even
+if we conduct extensive due diligence on a target business with which we combine, we cannot assure you that this diligence will surface
+all material issues that may be present inside a particular target business, that it would be possible to uncover all material issues
+through a customary amount of due diligence, or that factors outside of the target business and outside of our control will not later
+arise. As a result of these factors, we may be forced to later write-down or write-off assets, restructure our operations, or incur impairment
+or other charges that could result in our reporting losses. Even if our due diligence successfully identifies certain risks, unexpected
+risks may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though
+these charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature
+could contribute to negative market perceptions about us or our securities. In addition, charges of this nature may cause us to violate
+net worth or other covenants to which we may be subject as a result of assuming pre-existing debt held by a target business or by virtue
+of our obtaining debt financing to partially finance the initial business combination. Accordingly, any stockholders who choose to remain
+stockholders following the initial business combination could suffer a reduction in the value of their shares. Such stockholders are
+unlikely to have a remedy for such reduction in value unless they are able to successfully claim that the reduction was due to the breach
+by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they are able to successfully bring a private
+claim under securities laws that the proxy solicitation or tender offer materials, as applicable, relating to the initial business combination
+constituted an actionable material misstatement or omission.
+
+ 
+
+ 36
+
+ 
+
+ 
+
+ 
+
+If
+third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received
+by stockholders may be less than $10.15 per share.
+
+ 
+
+Our
+placing of funds in the trust account may not protect those funds from third-party claims against us. Although we will seek to have all
+vendors, service providers, prospective target businesses and other entities with which we do business execute agreements with us waiving
+any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our public stockholders,
+such parties may not execute such agreements, or even if they execute such agreements they may not be prevented from bringing claims
+against the trust account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar
+claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain advantage with respect to a claim
+against our assets, including the funds held in the trust account. If any third party refuses to execute an agreement waiving such claims
+to the monies held in the trust account, our management will perform an analysis of the alternatives available to it and will only enter
+into an agreement with a third party that has not executed a waiver if management believes that such third party s engagement would
+be significantly more beneficial to us than any alternative. MaloneBailey LLP, our independent registered public accounting firm,
+and the underwriters of this offering, will not execute agreements with us waiving such claims to the monies held in the trust account.
+
+ 
+
+Examples
+of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third party consultant
+whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would
+agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver. In addition,
+there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of,
+any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason. Upon redemption
+of our public shares, if we are unable to complete our initial business combination within the prescribed timeframe, or upon the exercise
+of a redemption right in connection with our initial business combination, we will be required to provide for payment of claims of creditors
+that were not waived that may be brought against us within the 10 years following redemption. Accordingly, the per-share redemption amount
+received by public stockholders could be less than the $10.15 per share initially held in the trust account, due to claims of
+such creditors.
+
+ 
+
+Pursuant to the letter agreement,
+the form of which is filed as Exhibit 10.1 to the registration statement of which this prospectus forms a part, our sponsor has agreed
+that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective
+target business with which we have entered into a written letter of intent, confidentiality or similar agreement or business combination
+agreement, reduce the amount of funds in the trust account to below the lesser of (i) $10.15 per public share and (ii) the actual
+amount per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.15
+per share due to reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply to any
+claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account
+(whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of this offering
+against certain liabilities, including liabilities under the Securities Act. However, we have not asked our sponsor to reserve for such
+indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations
+and believe that our sponsor s only assets are securities of our company. Therefore, we cannot assure you that our sponsor would
+be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties including, without
+limitation, claims by vendors and prospective target businesses. 
+
+Our
+directors may decide not to enforce the indemnification obligations of our sponsor, resulting in a reduction in the amount of funds in
+the trust account available for distribution to our public stockholders.
+
+ 
+
+In the event that the proceeds
+in the trust account are reduced below the lesser of (i) $10.15 per share and (ii) the actual amount per share held in the trust
+account as of the date of the liquidation of the trust account if less than $10.15 per share due to reductions in the value of
+the trust assets, in each case net of the interest which may be withdrawn to pay taxes, and our sponsor asserts that it is unable to
+satisfy its obligations or that it has no indemnification obligations related to a particular claim, our independent directors would
+determine whether to take legal action against our sponsor to enforce its indemnification obligations. 
+
+ 37
+
+ 
+
+ 
+
+ 
+
+While
+we currently expect that our independent directors would take legal action on our behalf against our sponsor to enforce its indemnification
+obligations to us, it is possible that our independent directors in exercising their business judgment and subject to their fiduciary
+duties may choose not to do so in any particular instance if, for example, the cost of such legal action is deemed by the independent
+directors to be too high relative to the amount recoverable or if the independent directors determine that a favorable outcome is not
+likely. If our independent directors choose not to enforce these indemnification obligations, the amount of funds in the trust account
+available for distribution to our public stockholders may be reduced below $10.15 per share.
+
+ 
+
+We
+may not have sufficient funds to satisfy indemnification claims of our directors and executive officers.
+
+ 
+
+We
+have agreed to indemnify our officers and directors to the fullest extent permitted by law. However, our officers and directors have
+agreed to waive any right, title, interest or claim of any kind in or to any monies in the trust account and to not seek recourse against
+the trust account for any reason whatsoever. Accordingly, any indemnification provided will be able to be satisfied by us only if (i)
+we have sufficient funds outside of the trust account or (ii) we consummate an initial business combination. Our obligation to indemnify
+our officers and directors may discourage stockholders from bringing a lawsuit against our officers or directors for breach of their
+fiduciary duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against our officers and
+directors, even though such an action, if successful, might otherwise benefit us and our stockholders. Furthermore, a stockholder s
+investment may be adversely affected to the extent we pay the costs of settlement and damage awards against our officers and directors
+pursuant to these indemnification provisions.
+
+ 
+
+If,
+after we distribute the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy
+petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and we and our board may be
+exposed to claims of punitive damages.
+
+ 
+
+If,
+after we distribute the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy
+petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor
+and/or bankruptcy laws as either a "preferential transfer" or a "fraudulent conveyance." As a result, a bankruptcy
+court could seek to recover some or all amounts received by our stockholders. In addition, our board of directors may be viewed as having
+breached its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing itself and us to claims of punitive damages,
+by paying public stockholders from the trust account prior to addressing the claims of creditors.
+
+ 
+
+If,
+before distributing the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy
+petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our
+stockholders and the per-share amount that would otherwise be received by our stockholders in connection with our liquidation may be
+reduced.
+
+ 
+
+If,
+before distributing the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy
+petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable bankruptcy
+law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our stockholders.
+To the extent any bankruptcy claims deplete the trust account, the per-share amount that would otherwise be received by our stockholders
+in connection with our liquidation may be reduced.
+
+ 
+
+If
+we are deemed to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements
+and our activities may be restricted, which may make it difficult for us to complete our initial business combination.
+
+ 
+
+If
+we are deemed to be an investment company under the Investment Company Act, our activities may be restricted, including:
+
+ 
+
+ 
+ 
+ 
+ restrictions
+ on the nature of our investments; and
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ restrictions
+ on the issuance of securities, each of which may make it difficult for us to complete our initial business combination.
+
+ 
+
+ 38
+
+ 
+
+ 
+
+ 
+
+In
+addition, we may have imposed upon us burdensome requirements, including:
+
+ 
+
+ 
+ 
+ 
+ registration
+ as an investment company with the SEC;
+
+ 
+ 
+ 
+
+ 
+ 
+ adoption
+ of a specific form of corporate structure; and
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ reporting,
+ record keeping, voting, proxy and disclosure requirements and other rules and regulations that we are currently not subject to.
+
+ 
+
+In
+order not to be regulated as an investment company under the Investment Company Act, unless we can qualify for an exclusion, we must
+ensure that we are engaged primarily in a business other than investing, reinvesting or trading in securities and that our activities
+do not include investing, reinvesting, owning, holding or trading "investment securities" constituting more than 40% of our
+total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis. Our business will be to identify and
+complete an initial business combination and thereafter to operate the post-transaction business or assets for the long term. We do not
+plan to buy businesses or assets with a view to resale or profit from their resale. We do not plan to buy unrelated businesses or assets
+or to be a passive investor.
+
+ 
+
+We do not believe that our anticipated
+principal activities will subject us to the Investment Company Act. To this end, the proceeds held in the trust account may only be invested
+in United States "government securities" within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity
+of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act
+which invest only in direct U.S. government treasury obligations. Pursuant to the trust agreement, the trustee is not permitted to invest
+in other securities or assets. By restricting the investment of the proceeds to these instruments, and by having a business plan targeted
+at acquiring and growing businesses for the long term (rather than on buying and selling businesses in the manner of a merchant bank
+or private equity fund), we intend to avoid being deemed an "investment company" within the meaning of the Investment Company
+Act. This offering is not intended for persons who are seeking a return on investments in government securities or investment securities.
+The trust account is intended as a holding place for funds pending the earliest to occur of: (i) the completion of our initial business
+combination; (ii) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and
+restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with
+our initial business combination or certain amendments to our amended and restated certificate of incorporation prior thereto or to redeem
+100% of our public shares if we do not complete an initial business combination within 12 months from the closing of this offering (or
+up to 18 months from the closing of this offering if extended as described elsewhere in this prospectus) or (B) with respect to
+any other provision relating to stockholders rights or pre-initial business combination activity; or (iii) if we fail to
+complete an initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing
+of this offering if extended as described elsewhere in this prospectus), our return of the funds held in the trust account to our public
+stockholders as part of our redemption of the public shares. If we do not invest the proceeds as discussed above, we may be deemed to
+be subject to the Investment Company Act. If we were deemed to be subject to the Investment Company Act, compliance with these additional
+regulatory burdens would require additional expenses for which we have not allotted funds and may hinder our ability to complete an initial
+business combination or may result in our liquidation. If we are unable to complete our initial business combination, our public stockholders
+may receive only approximately $10.15 per share on the liquidation of our trust account and our warrants will expire worthless.
+
+ 
+
+Our
+stockholders may be held liable for claims by third parties against us to the extent of distributions received by them upon redemption
+of their shares.
+
+ 
+
+Under
+the DGCL, stockholders may be held liable for claims by third parties against a corporation to the extent of distributions received by
+them in a dissolution. The pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public
+shares in the event we do not complete our initial business combination within 12 months from the closing of this offering
+(or up to 18 months from the closing of this offering if extended as described elsewhere in this prospectus) may be considered
+a liquidating distribution under Delaware law. If a corporation complies with certain procedures set forth in Section 280 of the DGCL
+intended to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during which any third-party
+claims can be brought against the corporation, a 90-day period during which the corporation may reject any claims brought, and an additional
+150-day waiting period before any liquidating distributions are made to stockholders, any liability of stockholders with respect to a
+liquidating distribution is limited to the lesser of such stockholder s pro rata share of the claim or the amount distributed to
+the stockholder, and any liability of the stockholder would be barred after the third anniversary of the dissolution. However, it is
+our intention to redeem our public shares as soon as reasonably possible following the 12th
+month from the closing of this offering in the event we do not complete an initial business
+combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if extended
+as described elsewhere in this prospectus) and, therefore, we do not intend to comply with the foregoing procedures.
+
+ 
+
+ 39
+
+ 
+
+ 
+
+ 
+
+Because we will not be
+complying with Section 280, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us at such time that
+will provide for our payment of all existing and pending claims or claims that may be potentially brought against us within the 10
+years following our dissolution. However, because we are a blank check company, rather than an operating company, and our operations
+will be limited to searching for prospective target businesses to acquire, the only likely claims to arise would be from our vendors
+(such as lawyers, investment bankers, etc.) or prospective target businesses. If our plan of distribution complies with Section
+281(b) of the DGCL, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such
+stockholder s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder
+would likely be barred after the third anniversary of the dissolution. We cannot assure you that we will properly assess all claims
+that may be potentially brought against us. As such, our stockholders could potentially be liable for any claims to the extent of
+distributions received by them (but no more) and any liability of our stockholders may extend beyond the third anniversary of such
+date. Furthermore, if the pro rata portion of our trust account distributed to our public stockholders upon the redemption of our
+public shares in the event we do not complete an initial business combination within 12 months from the closing of this offering (or
+up to 18 months from the closing of this offering if extended as described elsewhere in this prospectus) is not considered a
+liquidating distribution under Delaware law and such redemption distribution is deemed to be unlawful (potentially due to the
+imposition of legal proceedings that a party may bring or due to other circumstances that are currently unknown), then pursuant to
+Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six (6) years after the unlawful
+redemption distribution, instead of three (3) years, as in the case of a liquidating distribution.
+
+ 
+
+We
+may not hold an annual meeting of stockholders until after the consummation of our initial business combination, which could delay the
+opportunity for our stockholders to elect directors.
+
+ 
+
+In
+accordance with Nasdaq corporate governance requirements, we are not required to hold an annual meeting until no later than one year
+after our first fiscal year end following our listing on Nasdaq. Under Section 211(b) of the DGCL, we are, however, required to hold
+an annual meeting of stockholders for the purposes of electing directors in accordance with our bylaws unless such election is made by
+written consent in lieu of such a meeting. We may not hold an annual meeting of stockholders to elect new directors prior to the consummation
+of our initial business combination, and thus we may not be in compliance with Section 211(b) of the DGCL, which requires an annual meeting.
+Therefore, if our stockholders want us to hold an annual meeting prior to the consummation of our initial business combination, they
+may attempt to force us to hold one by submitting an application to the Delaware Court of Chancery in accordance with Section 211(c)
+of the DGCL.
+
+ 
+
+The
+grant of registration rights to our initial stockholders may make it more difficult to complete our initial business combination, and
+the future exercise of such rights may adversely affect the market price of our Class A common stock.
+
+ 
+
+Pursuant
+to an agreement to be entered into concurrently with the issuance and sale of the securities in this offering, our initial stockholders,
+their permitted transferees can demand that we register the resale of the placement units, the placement shares, the placement warrants,
+the shares of Class A common stock issuable upon exercise of the placement warrants, the shares of Class A common stock issuable upon
+conversion of the founder shares and the shares of Class A common stock included in the placement units and holders of units that may
+be issued upon conversion of working capital loans may demand that we register the resale of such shares of Class A common stock, warrants
+or the Class A common stock issuable upon exercise of such units and warrants. We will bear the cost of registering these securities.
+The registration and availability of such a significant number of securities for trading in the public market may have an adverse effect
+on the market price of our Class A common stock. In addition, the existence of the registration rights may make our initial business
+combination more costly or difficult to complete. This is because the stockholders of the target business may increase the equity stake
+they seek in the combined entity or ask for more cash consideration to offset the negative impact on the market price of our Class A
+common stock that is expected when the securities owned by our initial stockholders or holders of working capital loans or their respective
+permitted transferees are registered.
+
+ 
+
+ 40
+
+ 
+
+ 
+
+ 
+
+Because
+we are neither limited to evaluating a target business in a particular industry sector nor have we selected any specific target businesses
+with which to pursue our initial business combination, you will be unable to ascertain the merits or risks of any particular target business s
+operations.
+
+ 
+
+We
+will seek to complete an initial business combination with companies in the technology industry but may also pursue other business combination
+opportunities, except that we will not, under our amended and restated certificate of incorporation, be permitted to effectuate our initial
+business combination with another blank check company or similar company with nominal operations. Because we have not yet selected or
+approached any specific target business with respect to a business combination, there is no basis to evaluate the possible merits or
+risks of any particular target business s operations, results of operations, cash flows, liquidity, financial condition or prospects.
+To the extent we complete our initial business combination, we may be affected by numerous risks inherent in the business operations
+with which we combine. For example, if we combine with a financially unstable business or an entity lacking an established record of
+sales or earnings, we may be affected by the risks inherent in the business and operations of a financially unstable or a development
+stage entity. Although our officers and directors will endeavor to evaluate the risks inherent in a particular target business, we cannot
+assure you that we will properly ascertain or assess all of the significant risk factors or that we will have adequate time to complete
+due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability to control or reduce the chances
+that those risks will adversely impact a target business. We also cannot assure you that an investment in our units will ultimately prove
+to be more favorable to investors than a direct investment, if such opportunity were available, in a business combination target. Accordingly,
+any stockholders who choose to remain stockholders following our initial business combination could suffer a reduction in the value of
+their securities. Such stockholders are unlikely to have a remedy for such reduction in value unless they are able to successfully claim
+that the reduction was due to the breach by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they
+are able to successfully bring a private claim under securities laws that the proxy solicitation or tender offer materials, as applicable,
+relating to the business combination contained an actionable material misstatement or material omission.
+
+ 
+
+We
+may seek business combination opportunities in industries or sectors which may or may not be outside of our management s area of
+expertise.
+
+ 
+
+Although
+we intend to focus on identifying technology companies, we will consider an initial business combination outside of our management s
+area of expertise if an initial business combination candidate is presented to us and we determine that such candidate offers an attractive
+business combination opportunity for our company or we are unable to identify a suitable candidate in this sector after having expanded
+a reasonable amount of time and effort in an attempt to do so. Although our management will endeavor to evaluate the risks inherent in
+any particular business combination candidate, we cannot assure you that we will adequately ascertain or assess all of the significant
+risk factors. We also cannot assure you that an investment in our units will not ultimately prove to be less favorable to investors in
+this offering than a direct investment, if an opportunity were available, in an initial business combination candidate. In the event
+we elect to pursue a business combination outside of the areas of our management s expertise, our management s expertise
+may not be directly applicable to its evaluation or operation, and the information contained in this prospectus regarding the areas of
+our management s expertise would not be relevant to an understanding of the business that we elect to acquire. As a result, our
+management may not be able to adequately ascertain or assess all of the significant risk factors. Accordingly, any stockholders who choose
+to remain stockholders following our initial business combination could suffer a reduction in the value of their shares. Such stockholders
+are unlikely to have a remedy for such reduction in value.
+
+ 
+
+ 41
+
+ 
+
+ 
+
+ 
+
+Although
+we have identified general criteria and guidelines that we believe are important in evaluating prospective target businesses, we may
+enter into our initial business combination with a target that does not meet such criteria and guidelines, and as a result, the target
+business with which we enter into our initial business combination may not have attributes entirely consistent with our general criteria
+and guidelines.
+
+ 
+
+Although we have identified general
+criteria and guidelines for evaluating prospective target businesses, it is possible that a target business with which we enter into
+our initial business combination will not have all of these positive attributes. If we complete our initial business combination with
+a target that does not meet some or all of these guidelines, such combination may not be as successful as a combination with a business
+that does meet all of our general criteria and guidelines. In addition, if we announce a prospective business combination with a target
+that does not meet our general criteria and guidelines, a greater number of stockholders may exercise their redemption rights, which
+may make it difficult for us to meet any closing condition with a target business that requires us to have a minimum net worth or a certain
+amount of cash. In addition, if stockholder approval of the transaction is required by applicable law or stock exchange requirements,
+or we decide to obtain stockholder approval for business or other legal reasons, it may be more difficult for us to attain stockholder
+approval of our initial business combination if the target business does not meet our general criteria and guidelines. If we are unable
+to complete our initial business combination, our public stockholders may receive only approximately $10.15 per share on the liquidation
+of our trust account and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than
+$10.15 per share on the redemption of their shares. See "— If third parties bring claims against us, the proceeds
+held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.15
+per share" and other risk factors herein. 
+
+We
+may seek business combination opportunities with a financially unstable business or an entity lacking an established record of revenue,
+cash flow or earnings, which could subject us to volatile revenues, cash flows or earnings or difficulty in retaining key personnel.
+
+ 
+
+To
+the extent we complete our initial business combination with a financially unstable business or an entity lacking an established record
+of revenues or earnings, we may be affected by numerous risks inherent in the operations of the business with which we combine. These
+risks include volatile revenues or earnings and difficulties in obtaining and retaining key personnel. Although our officers and directors
+will endeavor to evaluate the risks inherent in a particular target business, we may not be able to properly ascertain or assess all
+of the significant risk factors and we may not have adequate time to complete due diligence. Furthermore, some of these risks may be
+outside of our control and leave us with no ability to control or reduce the chances that those risks will adversely impact a target
+business.
+
+ 
+
+We
+are not required to obtain a fairness opinion and consequently, you may have no assurance from an independent source that the price we
+are paying for the business is fair to our company from a financial point of view.
+
+ 
+
+Unless
+we complete our initial business combination with an affiliated entity or our board cannot independently determine the fair market value
+of the target business or businesses, we are not required to obtain an opinion from an independent investment banking firm or another
+independent entity that commonly renders valuation opinions that the price we are paying is fair to our company from a financial point
+of view. If no opinion is obtained, our stockholders will be relying on the judgment of our board of directors, who will determine fair
+market value based on standards generally accepted by the financial community. Such standards used will be disclosed in our proxy materials
+or tender offer documents, as applicable, related to our initial business combination.
+
+ 
+
+Resources
+could be wasted in researching business combinations that are not completed, which could materially adversely affect subsequent attempts
+to locate and acquire or merge with another business. If we are unable to complete our initial business combination, our public stockholders
+may receive only approximately $10.15 per share, or less than such amount in certain circumstances, on the liquidation of our
+trust account and our warrants will expire worthless.
+
+ 
+
+We anticipate that the investigation
+of each specific target business and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments
+will require substantial management time and attention and substantial costs for accountants, attorneys, consultants and others. If we
+decide not to complete a specific initial business combination, the costs incurred up to that point for the proposed transaction likely
+would not be recoverable. Furthermore, if we reach an agreement relating to a specific target business, we may fail to complete our initial
+business combination for any number of reasons including those beyond our control. Any such event will result in a loss to us of the
+related costs incurred which could materially adversely affect subsequent attempts to locate and acquire or merge with another business.
+If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.15 per
+share on the liquidation of our trust account and our warrants will expire worthless. In certain circumstances, our public stockholders
+may receive less than $10.15 per share on the redemption of their shares. See "— If third parties bring claims against
+us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less
+than $10.15 per share" and other risk factors herein. 
+
+ 42
+
+ 
+
+ 
+
+ 
+
+We
+may issue notes or other debt securities, or otherwise incur substantial debt, to complete an initial business combination, which may
+adversely affect our leverage and financial condition and thus negatively impact the value of our stockholders investment in us.
+
+ 
+
+Although
+we have no commitments as of the date of this prospectus to issue any notes or other debt securities, or to otherwise incur outstanding
+debt following this offering, we may choose to incur substantial debt to complete our initial business combination. We have agreed that
+we will not incur any indebtedness unless we have obtained from the lender a waiver of any right, title, interest or claim of any kind
+in or to the monies held in the trust account. As such, no issuance of debt will affect the per-share amount available for redemption
+from the trust account. Nevertheless, the incurrence of debt could have a variety of negative effects, including:
+
+ 
+
+ 
+ 
+ default
+ and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt
+ obligations;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ acceleration
+ of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants
+ that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such
+ financing while the debt security is outstanding;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ inability to pay dividends on our common stock;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ using
+ a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends
+ on our common stock if declared, our ability to pay expenses, make capital expenditures and acquisitions, and fund other general
+ corporate purposes;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ limitations
+ on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ increased
+ vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ limitations
+ on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, and execution
+ of our strategy; and
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ other
+ disadvantages compared to our competitors who have less debt.
+
+ 
+
+We
+may issue additional common stock or preferred stock to complete our initial business combination or under an employee incentive plan
+after completion of our initial business combination. We may also issue shares of Class A common stock upon the conversion of the
+Class B common stock at a ratio greater than one-to-one at the time of the consummation of our initial business combination as a
+result of the anti-dilution provisions contained in our amended and restated certificate of incorporation. Any such issuances would dilute
+the interest of our stockholders and likely present other risks.
+
+ 
+
+Our amended and restated certificate
+of incorporation will authorize the issuance of up to 125,000,000 shares of Class A common stock, par value $0.0001 per share, 12,500,000
+shares of Class B common stock, par value $0.0001 per share, and 1,250,000 shares of preferred stock, par value $0.0001 per share.
+Immediately after this offering and the sale of the placement units, there will be 117,116,106
+and 10,625,000 (assuming, in each case, that the underwriters have not exercised their over-allotment option) authorized but unissued
+shares of Class A common stock and Class B common stock, respectively, available for issuance, which amount does not take into
+account the shares of Class A common stock reserved for issuance upon exercise of outstanding warrants or the shares of Class A
+common stock issuable upon conversion of Class B common stock. Immediately after the consummation of this offering, there will be
+no shares of preferred stock issued and outstanding. Shares of Class B common stock are convertible into shares of our Class A
+common stock initially at a one-for-one ratio but subject to adjustment as set forth herein, including in certain circumstances in which
+we issue Class A common stock or equity-linked securities related to our initial business combination. 
+
+ 43
+
+ 
+
+ 
+
+ 
+
+We may issue a substantial number
+of additional shares of common or preferred stock to complete our initial business combination or under an employee incentive plan after
+completion of our initial business combination (although our amended and restated certificate of incorporation will provide that we may
+not issue securities that can vote with common stockholders on matters related to our pre-initial business combination activity). We
+may also issue shares of Class A common stock upon conversion of the Class B common stock at a ratio greater than one-to-one at the time
+of the consummation of our initial business combination as a result of the anti-dilution provisions contained in our amended and restated
+certificate of incorporation. However, our amended and restated certificate of incorporation will provide, among other things, that prior
+to our initial business combination, we may not issue additional shares of capital stock that would entitle the holders thereof to (i)
+receive funds from the trust account or (ii) vote on any initial business combination. These provisions of our amended and restated certificate
+of incorporation, like all provisions of our amended and restated certificate of incorporation, may be amended with the approval of our
+stockholders. However, our executive officers, directors and director nominees have agreed, pursuant to a written agreement with us,
+that they will not propose any amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing
+of our obligation to allow redemption in connection with our initial business combination or certain amendments to our amended and restated
+certificate of incorporation prior thereto or to redeem 100% of our public shares if we do not complete an initial business combination
+within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if extended as described
+elsewhere in this prospectus) or (B) with respect to any other provision relating to stockholders rights or pre-initial business
+combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of common stock upon approval
+of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including
+interest (which interest shall be net of taxes payable), divided by the number of then outstanding public shares.
+
+ 
+
+The
+issuance of additional shares of common or preferred stock:
+
+ 
+
+ 
+ 
+ 
+ may
+ significantly dilute the equity interest of investors in this offering, which dilution would increase if the anti-dilution provisions
+ in the Class B common stock resulted in the issuance of Class A shares on a greater than one-to-one basis upon conversion of the
+ Class B common stock;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ may
+ subordinate the rights of holders of our common stock if preferred stock is issued with rights senior to those afforded our common
+ stock;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ could
+ cause a change of control if a substantial number of shares of our common stock are issued, which may affect, among other things,
+ our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers
+ and directors;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ may
+ have the effect of delaying or preventing a change of control of us by diluting the stock ownership or voting rights of a person
+ seeking to obtain control of us; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ may
+ adversely affect prevailing market prices for our units, Class A common stock and/or warrants.
+
+ 
+
+ 
+
+We
+may only be able to complete one business combination with the proceeds of this offering, the sale of the placement units, which will
+cause us to be solely dependent on a single business which may have a limited number of services and limited operating activities. This
+lack of diversification may negatively impact our operating results and profitability.
+
+ 
+
+Of the net proceeds from this
+offering and the sale of the placement units, $76,125,000 (or $87,543,750 if the underwriters over-allotment option is
+exercised in full) will be available to complete our initial business combination and pay related fees and expenses (which includes up
+to $2,437,500, or up to $2,803,125 if the over-allotment option is exercised in full, for the payment of deferred underwriting commissions). 
+
+We
+may effectuate our initial business combination with a single target business or multiple target businesses simultaneously or within
+a short period of time. However, we may not be able to effectuate our initial business combination with more than one target business
+because of various factors, including the existence of complex accounting issues and the requirement that we prepare and file pro forma
+financial statements with the SEC that present operating results and the financial condition of several target businesses as if they
+had been operated on a combined basis. By completing our initial business combination with only a single entity, our lack of diversification
+may subject us to numerous economic, competitive and regulatory developments. Further, we would not be able to diversify our operations
+or benefit from the possible spreading of risks or offsetting of losses, unlike other entities which may have the resources to complete
+several business combinations in different industries or different areas of a single industry. In addition, we intend to focus our search
+for an initial business combination in a single industry. Accordingly, the prospects for our success may be:
+
+ 
+
+ 
+ 
+ solely
+ dependent upon the performance of a single business, property or asset, or
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ dependent
+ upon the development or market acceptance of a single or limited number of products, processes or services.
+
+ 
+
+This
+lack of diversification may subject us to numerous economic, competitive and regulatory risks, any or all of which may have a substantial
+adverse impact upon the particular industry in which we may operate subsequent to our initial business combination.
+
+ 
+
+ 44
+
+ 
+
+ 
+
+ 
+
+We
+may attempt to simultaneously complete business combinations with multiple prospective targets, which may hinder our ability to complete
+our initial business combination and give rise to increased costs and risks that could negatively impact our operations and profitability.
+
+ 
+
+If
+we determine to simultaneously acquire several businesses that are owned by different sellers, we will need for each of such sellers
+to agree that our purchase of its business is contingent on the simultaneous closings of the other business combinations, which may make
+it more difficult for us, and delay our ability, to complete our initial business combination. We do not, however, intend to purchase
+multiple businesses in unrelated industries in conjunction with our initial business combination. With multiple business combinations,
+we could also face additional risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence
+investigations (if there are multiple sellers) and the additional risks associated with the subsequent assimilation of the operations
+and services or products of the acquired companies in a single operating business. If we are unable to adequately address these risks,
+it could negatively impact our profitability and results of operations.
+
+ 
+
+We
+may attempt to complete our initial business combination with a private company about which little information is available, which may
+result in an initial business combination with a company that is not as profitable as we suspected, if at all.
+
+ 
+
+In
+pursuing our initial business combination strategy, we may seek to effectuate our initial business combination with a privately held
+company. Very little public information generally exists about private companies, and we could be required to make our decision on whether
+to pursue a potential initial business combination on the basis of limited information, which may result in an initial business combination
+with a company that is not as profitable as we suspected, if at all.
+
+ 
+
+Our
+management may not be able to maintain control of a target business after our initial business combination.
+
+ 
+
+We
+may structure an initial business combination so that the post-transaction company in which our public stockholders own shares will own
+less than 100% of the equity interests or assets of a target business, but we will only complete such business combination if the post-transaction
+company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest
+in the target sufficient for us not to be required to register as an investment company under the Investment Company Act. We will not
+consider any transaction that does not meet such criteria. Even if the post-transaction company owns 50% or more of the voting securities
+of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post business
+combination company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could
+pursue a transaction in which we issue a substantial number of new shares of Class A common stock in exchange for all of the outstanding
+capital stock of a target. In this case, we would acquire a 100% interest in the target. However, as a result of the issuance of a substantial
+number of new shares of common stock, our stockholders immediately prior to such transaction could own less than a majority of our outstanding
+shares of common stock subsequent to such transaction. In addition, other minority stockholders may subsequently combine their holdings
+resulting in a single person or group obtaining a larger share of the company s stock than we initially acquired. Accordingly,
+this may make it more likely that our management will not be able to maintain our control of the target business. We cannot provide assurance
+that, upon loss of control of a target business, new management will possess the skills, qualifications or abilities necessary to profitably
+operate such business.
+
+ 
+
+If we seek shareholder approval of our initial business combination
+and we do not conduct redemptions pursuant to the tender offer rules, and if you or a "group" of shareholders are deemed
+to hold in excess of 15% of our ordinary shares, you will lose the ability to redeem all such shares in excess of 15% of our ordinary
+shares.
+
+ 
+
+If we seek shareholder approval of our initial
+business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer
+rules, our amended and restated memorandum and articles of association will provide that a public shareholder, together with any affiliate
+of such shareholder or any other person with whom such shareholder is acting in concert or as a "group" (as defined under
+Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect to more than an aggregate of 15% of the
+shares sold in this offering, which we refer to as the "Excess Shares." However, we would not be restricting our shareholders 
+ability to vote all of their shares (including Excess Shares) for or against our initial business combination. Your inability to redeem
+the Excess Shares will reduce your influence over our ability to complete our initial business combination and you could suffer a material
+loss on your investment in us if you sell Excess Shares in open market transactions. Additionally, you will not receive redemption distributions
+with respect to the Excess Shares if we complete our initial business combination. And as a result, you will continue to hold that number
+of shares exceeding 15% and, in order to dispose of such shares, would be required to sell your shares in open market transactions, potentially
+at a loss.
+
+ 
+
+ 45
+
+ 
+
+ 
+
+ 
+
+In
+order to effectuate an initial business combination, blank check companies have, in the recent past, amended various provisions of their
+charters and other governing instruments, including their warrant agreements. We cannot assure you that we will not seek to amend our
+amended and restated certificate of incorporation or governing instruments in a manner that will make it easier for us to complete our
+initial business combination that our stockholders may not support.
+
+ 
+
+In order to effectuate an initial
+business combination, blank check companies have, in the recent past, amended various provisions of their charters and modified governing
+instruments, including their warrant agreements. For example, blank check companies have amended the definition of business combination,
+increased redemption thresholds and extended the time to consummate an initial business combination and, with respect to their warrants,
+amended their warrant agreements to require the warrants to be exchanged for cash and/or other securities. Amending our amended and restated
+certificate of incorporation will require the approval of holders of 65% of our common stock, and amending our warrant agreement will
+require a vote of holders of at least a majority of the public warrants (which may include public warrants acquired by our sponsor or
+its affiliates in this offering or thereafter in the open market). In addition, our amended and restated certificate of incorporation
+requires us to provide our public stockholders with the opportunity to redeem their public shares for cash if we propose an amendment
+to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption
+in connection with our initial business combination or certain amendments to our amended and restated certificate of incorporation prior
+thereto or to redeem 100% of our public shares if we do not complete an initial business combination within 12 months from the closing
+of this offering (or up to 18 months from the closing of this offering if extended as described elsewhere in this prospectus)
+or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity.
+
+ 
+
+To
+the extent any such amendments would be deemed to fundamentally change the nature of any securities offered through this registration
+statement, we would register, or seek an exemption from registration for, the affected securities. We cannot assure you that we
+will not seek to amend our amended and restated certificate of incorporation or governing instruments or extend the time
+to consummate an initial business combination in order to effectuate our initial business combination.
+
+ 
+
+The
+provisions of our amended and restated certificate of incorporation that relate to our pre-business combination activity (and corresponding
+provisions of the agreement governing the release of funds from our trust account), including an amendment to permit us to withdraw funds
+from the trust account such that the per share amount investors will receive upon any redemption or liquidation is substantially reduced
+or eliminated, may be amended with the approval of holders of at least 65% of our common stock, which is a lower amendment threshold
+than that of some other blank check companies. It may be easier for us, therefore, to amend our amended and restated certificate of incorporation
+and the trust agreement to facilitate the completion of an initial business combination that some of our stockholders may not support.
+
+ 
+
+Our
+amended and restated certificate of incorporation will provide that any of its provisions related to pre-initial business combination
+activity (including the requirement to deposit proceeds of this offering and the sale of the placement units into the trust account and
+not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein
+and including to permit us to withdraw funds from the trust account such that the per share amount investors will receive upon any redemption
+or liquidation is substantially reduced or eliminated) may be amended if approved by holders of at least 65% of our common stock entitled
+to vote thereon, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended
+if approved by holders of at least 65% of our common stock entitled to vote thereon. In all other instances, our amended and restated
+certificate of incorporation may be amended by holders of a majority of our outstanding common stock entitled to vote thereon, subject
+to applicable provisions of the DGCL or applicable stock exchange rules. We may not issue additional securities that can vote on amendments
+to our amended and restated certificate of incorporation. Our initial stockholders, who will collectively beneficially own approximately
+22.8% of our common stock upon the closing of this offering (including the placement shares to be issued to the sponsor and assuming
+they do not purchase any units in this offering), will participate in any vote to amend our amended and restated certificate of incorporation
+and/or trust agreement and will have the discretion to vote in any manner they choose. As a result, we may be able to amend the provisions
+of our amended and restated certificate of incorporation which govern our pre-initial business combination behavior more easily than
+some other blank check companies, and this may increase our ability to complete an initial business combination with which you do not
+agree. Our stockholders may pursue remedies against us for any breach of our amended and restated certificate of incorporation.
+
+ 
+
+ 46
+
+ 
+
+ 
+
+ 
+
+Our sponsor, officers and directors
+have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate
+of incorporation (i) to modify the substance or timing of our obligation to allow redemption in connection with our initial business
+combination or certain amendments to our amended and restated certificate of incorporation prior thereto or to redeem 100% of our public
+shares if we do not complete an initial business combination within 12 months from the closing of this offering (or up to 18 months
+from the closing of this offering if extended as described elsewhere in this prospectus) or (ii) with respect to any other provision
+relating to stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the
+opportunity to redeem their shares of Class A common stock upon approval of any such amendment at a per-share price, payable in cash,
+equal to the aggregate amount then on deposit in the trust account, divided by the number of then outstanding public shares. These agreements
+are contained in a letter agreement that we have entered into with our sponsor, officers and directors. Our stockholders are not parties
+to, or third-party beneficiaries of, these agreements and, as a result, will not have the ability to pursue remedies against our sponsor,
+officers or directors for any breach of these agreements. As a result, in the event of a breach, our stockholders would need to pursue
+a stockholder derivative action, subject to applicable law.
+
+ 
+
+We
+may be unable to obtain additional financing to complete our initial business combination or to fund the operations and growth of a target
+business, which could compel us to restructure or abandon a particular business combination.
+
+ 
+
+We have not selected any specific
+business combination target, but intend to target businesses larger than we could acquire with the net proceeds of this offering and
+the sale of the placement units. As a result, we may be required to seek additional financing to complete such proposed initial business
+combination. We cannot assure you that such financing will be available on acceptable terms, if at all. To the extent that additional
+financing proves to be unavailable when needed to complete our initial business combination, we would be compelled to either restructure
+the transaction or abandon that particular business combination and seek an alternative target business candidate. Further, the amount
+of additional financing we may be required to obtain could increase as a result of future growth capital needs for any particular transaction,
+the depletion of the available net proceeds in search of a target business, the obligation to repurchase for cash a significant number
+of shares from stockholders who elect redemption in connection with our initial business combination and/or the terms of negotiated transactions
+to purchase shares in connection with our initial business combination. If we are unable to complete our initial business combination,
+our public stockholders may receive only approximately $10.15 per share plus any pro rata interest earned on the funds held in
+the trust account and not previously released to us to pay our taxes on the liquidation of our trust account and our warrants will expire
+worthless. In addition, even if we do not need additional financing to complete our initial business combination, we may require such
+financing to fund the operations or growth of the target business. The failure to secure additional financing could have a material adverse
+effect on the continued development or growth of the target business. None of our officers, directors or stockholders is required to
+provide any financing to us in connection with or after our initial business combination. If we are unable to complete our initial business
+combination, our public stockholders may only receive approximately $10.15 per share on the liquidation of our trust account,
+and our warrants will expire worthless. Furthermore, as described in the risk factor entitled "If third parties bring claims against
+us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less
+than $10.15 per share," under certain circumstances our public stockholders may receive less than $10.00 per share upon
+the liquidation of the trust account. 
+
+ 47
+
+ 
+
+ 
+
+ 
+
+Our
+initial stockholders may exert a substantial influence on actions requiring a stockholder vote, potentially in a manner that you do not
+support.
+
+ 
+
+Upon
+the closing of this offering, our initial stockholders will own shares representing approximately 22.8% of our issued and outstanding
+shares of common stock (including the placement shares to be issued to the sponsor and assuming they do not purchase any units in this
+offering). Accordingly, they may exert a substantial influence on actions requiring a stockholder vote, potentially in a manner that
+you do not support, including amendments to our amended and restated certificate of incorporation and approval of major corporate transactions.
+If our initial stockholders purchase any units in this offering or if our initial stockholders purchase any additional shares of common
+stock in the aftermarket or in privately negotiated transactions, this would increase their control. Factors that would be considered
+in making such additional purchases would include consideration of the current trading price of our Class A common stock. In addition,
+our board of directors, whose members were elected by our initial stockholders, is and will be divided into two classes, each of which
+will generally serve for a term of two years with only one class of directors being elected in each year. We may not hold an annual meeting
+of stockholders to elect new directors prior to the completion of our initial business combination, in which case all of the current
+directors will continue in office until at least the completion of the initial business combination. If there is an annual meeting, as
+a consequence of our "staggered" board of directors, only a minority of the board of directors will be considered for election
+and our initial stockholders, because of their ownership position, will have considerable influence regarding the outcome. Accordingly,
+our initial stockholders will continue to exert control at least until the completion of our initial business combination.
+
+ 
+
+Our
+sponsor paid an aggregate of $25,000 for the founder shares, or approximately $0.01 per founder share. As a result of this low
+initial price, our sponsor, its affiliates and our management team stand to make a substantial profit even if an initial business combination
+subsequently declines in value or is unprofitable for our public stockholders.
+
+ 
+
+As
+a result of the low acquisition cost of our founder shares, our sponsor, its affiliates and our management team could make a substantial
+profit even if we select and consummate an initial business combination with an acquisition target that subsequently declines in value
+or is unprofitable for our public stockholders. Thus, such parties may have more of an economic incentive for us to enter into an initial
+business combination with a riskier, weaker-performing or financially unstable business, or an entity lacking an established record of
+revenues or earnings, than would be the case if such parties had paid the full offering price for their founder shares.
+
+ 
+
+Because
+we must furnish our stockholders with target business financial statements, we may lose the ability to complete an otherwise advantageous
+initial business combination with some prospective target businesses.
+
+ 
+
+The
+federal proxy rules require that a proxy statement with respect to a vote on an initial business combination meeting certain financial
+significance tests include historical and/or pro forma financial statement disclosure in periodic reports. We will include the same financial
+statement disclosure in connection with our tender offer documents, whether or not they are required under the tender offer rules. These
+financial statements may be required to be prepared in accordance with, or be reconciled to, accounting principles generally accepted
+in the United States of America, or GAAP, or international financial reporting standards as issued by the International Accounting Standards
+Board, or IFRS, depending on the circumstances and the historical financial statements may be required to be audited in accordance with
+the standards of the Public Company Accounting Oversight Board (United States), or PCAOB. These financial statement requirements may
+limit the pool of potential target businesses we may acquire because some targets may be unable to provide such financial statements
+in time for us to disclose such statements in accordance with federal proxy rules and complete our initial business combination within
+the prescribed time frame.
+
+ 
+
+Compliance
+obligations under the Sarbanes-Oxley Act may make it more difficult for us to effectuate our initial business combination, require substantial
+financial and management resources, and increase the time and costs of completing an initial business combination.
+
+ 
+
+Section
+404 of the Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls beginning with our Annual Report
+on Form 10-K for the year ending December 31, 2022. Only in the event we are deemed to be a large accelerated filer or an accelerated
+filer, and no longer qualify as an emerging growth company, will we be required to comply with the independent registered public accounting
+firm attestation requirement on our internal control over financial reporting. Further, for as long as we remain an emerging growth company,
+we will not be required to comply with the independent registered public accounting firm attestation requirement on our internal control
+over financial reporting. The fact that we are a blank check company makes compliance with the requirements of the Sarbanes-Oxley Act
+particularly burdensome on us as compared to other public companies because a target company with which we seek to complete our initial
+business combination may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of its internal controls.
+The development of the internal control of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and
+costs necessary to complete any such business combination.
+
+ 
+
+ 48
+
+ 
+
+ 
+
+ 
+
+If
+we effect our initial business combination with a company with operations or opportunities outside of the United States, we would be
+subject to a variety of additional risks that may negatively impact our operations.
+
+ 
+
+If
+we effect our initial business combination with a company with operations or opportunities outside of the United States, we would be
+subject to any special considerations or risks associated with companies operating in an international setting, including any of the
+following:
+
+ 
+
+ 
+ 
+ 
+ higher
+ costs and difficulties inherent in managing cross-border business operations and complying with different commercial and legal requirements
+ of overseas markets;
+
+ 
+ 
+ 
+
+ 
+ 
+ rules
+ and regulations regarding currency redemption;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ complex
+ corporate withholding taxes on individuals;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ laws
+ governing the manner in which future business combinations may be effected;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ tariffs
+ and trade barriers;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ regulations
+ related to customs and import/export matters;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ longer
+ payment cycles and challenges in collecting accounts receivable;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ tax
+ issues, including but not limited to tax law changes and variations in tax laws as compared to the United States;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ currency
+ fluctuations and exchange controls;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ rates
+ of inflation;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ cultural
+ and language differences;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ employment
+ regulations;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ crime,
+ strikes, riots, civil disturbances, terrorist attacks, natural disasters and wars;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ deterioration
+ of political relations with the United States; and
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ government
+ appropriations of assets.
+
+ 
+
+ 49
+
+ 
+
+ 
+
+ 
+
+If
+our management team following our initial business combination is unfamiliar with United States securities laws, they may have to expend
+time and resources becoming familiar with such laws, which could lead to various regulatory issues.
+
+ 
+
+Following
+our initial business combination, our founding team may resign from their positions as officers or directors of the company and the management
+of the business combination partner will may assume the roles of executive officers and directors of our company. Such officers and directors
+may not be familiar with United States securities laws (particularly if our target business is located in Central or South America).
+If our new management following our initial business combination is unfamiliar with United States securities laws, they may have to expend
+time and resources becoming familiar with such laws. This could be expensive and time-consuming and could lead to various regulatory
+issues which may adversely affect our operations.
+
+ 
+
+After
+our initial business combination, substantially all of our assets may be located in a foreign country and substantially all of our revenue
+may be derived from our operations in such country. Accordingly, our results of operations and prospects will be subject, to a significant
+extent, to the economic, political and social conditions and government policies, developments and conditions in the country in which
+we operate.
+
+ 
+
+As
+we may acquire a business located outside of the United States as part of our initial
+business combination, the economic, political and social
+conditions, as well as government policies, of the country in which our operations would be located following our initial business combination
+could affect our business. Economic growth could be uneven, both geographically and among various sectors of the economy and such growth
+may not be sustained in the future. If in the future such country s economy experiences a downturn or grows at a slower rate than
+expected, there may be less demand for spending in certain industries. A decrease in demand for spending in certain industries could
+materially and adversely affect our ability to find an attractive target business with which to consummate our initial business combination
+and if we effect our initial business combination, the ability of that target business to become profitable.
+
+ 
+
+Exchange
+rate fluctuations and currency policies may cause our target business ability to succeed in the international markets to be diminished.
+
+ 
+
+In
+the event we acquire a non-U.S. business as part of our initial business combination, all revenues and income would likely be received
+in a foreign currency, and the dollar equivalent of our net assets and distributions, if any, could be adversely affected by reductions
+in the value of the local currency. The value of the currencies in our target regions fluctuate and are affected by, among other things,
+changes in political and economic conditions. Any change in the relative value of such currency against our reporting currency may affect
+the attractiveness of any target business or, following consummation of our initial business combination, our financial condition and
+results of operations. Additionally, if a currency appreciates in value against the dollar prior to the consummation of our initial business
+combination, the cost of a target business as measured in dollars will increase, which may make it less likely that we are able to consummate
+such transaction.
+
+ 
+
+ 50
+
+ 
+
+ 
+
+ 
+
+We
+may reincorporate in another jurisdiction in connection with our initial business combination, and the laws of such jurisdiction may
+govern some or all of our future material agreements and we may not be able to enforce our legal rights.
+
+ 
+
+In
+connection with our initial business combination, we may relocate the home jurisdiction of our business from the U.S. to another jurisdiction.
+If we determine to do this, the laws of such jurisdiction may govern some or all of our future material agreements. The system of laws
+and the enforcement of existing laws in such jurisdiction may not be as certain in implementation and interpretation as in the United
+States. The inability to enforce or obtain a remedy under any of our future agreements could result in a significant loss of business,
+business opportunities or capital.
+
+ 
+
+Risks
+Relating to our Sponsor and Management Team
+
+ 
+
+Our
+ability to successfully effect our initial business combination and to be successful thereafter will be totally dependent upon the efforts
+of our key personnel, some of whom may join us following our initial business combination. The loss of key personnel could negatively
+impact the operations and profitability of our post-combination business.
+
+ 
+
+Our
+ability to successfully effect our initial business combination is dependent upon the efforts of our key personnel. The role of our key
+personnel in the target business, however, cannot presently be ascertained. Although some of our key personnel may remain with the target
+business in senior management or advisory positions following our initial business combination, it is likely that some or all of the
+management of the target business will remain in place. While we intend to closely scrutinize any individuals we employ after our initial
+business combination, we cannot assure you that our assessment of these individuals will prove to be correct. These individuals may be
+unfamiliar with the requirements of operating a company regulated by the SEC, which could cause us to have to expend time and resources
+helping them become familiar with such requirements. In addition, the officers and directors of an initial business combination candidate
+may resign upon completion of our initial business combination. The departure of an initial business combination target s key personnel
+could negatively impact the operations and profitability of our post-combination business. The role of an initial business combination
+candidate s key personnel upon the completion of our initial business combination cannot be ascertained at this time. Although
+we contemplate that certain members of an initial business combination candidate s management team will remain associated with
+the initial business combination candidate following our initial business combination, it is possible that members of the management
+of an initial business combination candidate will not wish to remain in place. The loss of key personnel could negatively impact the
+operations and profitability of our post-combination business.
+
+ 
+
+We
+are dependent upon our executive officers and directors and their departure could adversely affect our ability to operate.
+
+ 
+
+Our
+operations are dependent upon a relatively small group of individuals and, in particular, our executive officers and directors. We believe
+that our success depends on the continued service of our executive officers and directors, at least until we have completed our initial
+business combination. We do not have an employment agreement with, or key-man insurance on the life of, any of our directors or executive
+officers. The unexpected loss of the services of one or more of our directors or executive officers could have a detrimental effect on
+us.
+
+ 
+
+Our
+key personnel may negotiate employment or consulting agreements with a target business in connection with a particular business combination.
+These agreements may provide for them to receive compensation following our initial business combination and as a result, may cause them
+to have conflicts of interest in determining whether a particular business combination is the most advantageous.
+
+ 
+
+Our
+key personnel may be able to remain with the company after the completion of our initial business combination only if they are able to
+negotiate employment or consulting agreements in connection with the initial business combination. Such negotiations would take place
+simultaneously with the negotiation of the initial business combination and could provide for such individuals to receive compensation
+in the form of cash payments and/or our securities for services they would render to us after the completion of the initial business
+combination. The personal and financial interests of such individuals may influence their motivation in identifying and selecting a target
+business. However, we believe the ability of such individuals to remain with us after the completion of our initial business combination
+will not be the determining factor in our decision as to whether or not we will proceed with any potential business combination. There
+is no certainty, however, that any of our key personnel will remain with us after the completion of our initial business combination.
+We cannot assure you that any of our key personnel will remain in senior management or advisory positions with us. The determination
+as to whether any of our key personnel will remain with us will be made at the time of the consummation of our initial business combination.
+
+ 
+
+ 51
+
+ 
+
+ 
+
+ 
+
+We
+may have a limited ability to assess the management of a prospective target business and, as a result, may affect our initial
+business combination with a target business whose management may not have the skills, qualifications or abilities to manage a public
+company, which could, in turn, negatively impact the value of our stockholders investment in us.
+
+ 
+
+When
+evaluating the desirability of effecting our initial business combination with a prospective target business, our ability to assess the
+target business s management may be limited due to a lack of time, resources or information. Our assessment of the capabilities
+of the target s management, therefore, may prove to be incorrect and such management may lack the skills, qualifications or abilities
+we suspected. Should the target s management not possess the skills, qualifications or abilities necessary to manage a public company,
+the operations and profitability of the post-combination business may be negatively impacted. Accordingly, any stockholders who choose
+to remain stockholders following the initial business combination could suffer a reduction in the value of their shares. Such stockholders
+are unlikely to have a remedy for such reduction in value.
+
+ 
+
+Our
+officers and directors will allocate their time to other businesses thereby causing conflicts of interest in their determination as to
+how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial
+business combination.
+
+ 
+
+Our
+officers and directors are not required to, and will not, commit their full time to our affairs, which may result in a conflict of interest
+in allocating their time between our operations and our search for an initial business combination and their other businesses. We do
+not intend to have any full-time employees prior to the completion of our initial business combination. Each of our officers is engaged
+in other business endeavors for which he may be entitled to substantial compensation and our officers are not obligated to contribute
+any specific number of hours per week to our affairs. Our independent directors may also serve as officers or board members for other
+entities. If our officers and directors other business affairs require them to devote substantial amounts of time to such
+affairs in excess of their current commitment levels, it could limit their ability to devote time to our affairs which may have a negative
+impact on our ability to complete our initial business combination. For a complete discussion of our officers and directors 
+other business affairs, please see the section of this prospectus entitled "Management — Directors and Officers."
+
+ 
+
+Certain
+of our officers and directors are now, and all of them may in the future become, affiliated with entities engaged in business activities
+similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in allocating their time and determining
+to which entity a particular business opportunity should be presented.
+
+ 
+
+Following
+the completion of this offering and until we consummate our initial business combination, we intend to engage in the business of identifying
+and combining with one or more businesses. Our sponsor and officers and directors are, and may in the future become, affiliated with
+entities (such as operating companies or investment vehicles) that are engaged in a similar business and our officers and directors may
+become officers or directors of another special purpose acquisition company with a class of securities intended to be registered under
+the Exchange Act, even prior to us entering into a definitive agreement for our initial business combination. Our officers and directors
+also may become aware of business opportunities which may be appropriate for presentation to us and the other entities to which they
+owe certain fiduciary or contractual duties.
+
+ 
+
+Accordingly,
+they may have conflicts of interest in determining to which entity a particular business opportunity should be presented. These conflicts
+may not be resolved in our favor and a potential target business may be presented to another entity prior to its presentation to us.
+Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered
+to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or
+officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable
+for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal
+obligation.
+
+ 
+
+ 52
+
+ 
+
+ 
+
+ 
+
+For
+a complete discussion of our officers and directors business affiliations and the potential conflicts of interest that
+you should be aware of, please see the sections of this prospectus entitled "Management — Directors and Officers,"
+"Management — Conflicts of Interest" and "Certain Relationships and Related Party Transactions."
+
+ 
+
+Our
+officers, directors, security holders and their respective affiliates may have competitive pecuniary interests that conflict with our
+interests.
+
+ 
+
+We
+have not adopted a policy that expressly prohibits our directors, officers, security holders or affiliates from having a direct or indirect
+pecuniary or financial interest in any investment to be acquired or disposed of by us or in any transaction to which we are a party or
+have an interest. In fact, we may enter into an initial business combination with a target business that is affiliated with our sponsor,
+our directors or officers, although we do not intend to do so. We do not have a policy that expressly prohibits any such persons from
+engaging for their own account in business activities of the types conducted by us. Accordingly, such persons or entities may have a
+conflict between their interests and ours.
+
+ 
+
+Changes in the market for directors 
+and officers liability insurance could make it more difficult and more expensive for us to negotiate and complete an
+initial business combination.
+
+ 
+
+In recent months, the market for
+directors and officers liability insurance for special purpose acquisition companies has changed. Fewer insurance
+companies are offering quotes for directors and officers liability coverage, the premiums charged for such
+policies have generally increased and the terms of such policies have generally become less favorable. There can be no assurance that
+these trends will not continue.
+
+ 
+
+The increased cost and decreased
+availability of directors and officers liability insurance could make it more difficult and more expensive
+for us to negotiate an initial business combination. In order to obtain directors and officers liability insurance or modify its coverage
+as a result of becoming a public company, the post-business combination entity might need to incur greater expense, accept less favorable
+terms or both. However, any failure to obtain adequate directors and officers liability insurance could have
+an adverse impact on the post-business combination s ability to attract and retain qualified officers and directors.
+
+ 
+
+In addition, even after we were to complete an initial business combination,
+our directors and officers could still be subject to potential liability from claims arising from conduct alleged to have occurred prior
+to the initial business combination. As a result, in order to protect our directors and officers, the post-business combination entity
+may need to purchase additional insurance with respect to any such claims ("run-off insurance"). The need for run-off insurance
+would be an added expense for the post-business combination entity, and could interfere with or frustrate our ability to consummate an
+initial business combination on terms favorable to our investors.
+
+ 
+
+We
+may engage in an initial business combination with one or more target businesses that have relationships with entities that may be affiliated
+with our sponsor, officers, directors or existing holders which may raise potential conflicts of interest.
+
+ 
+
+In
+light of the involvement of our sponsor, officers and directors with other entities, we may decide to acquire one or more businesses
+affiliated with our sponsor, officers or directors. Our directors and officers also serve as officers and board members for other entities,
+including, without limitation, those described under the section of this prospectus entitled "Management — Conflicts of Interest."
+Such entities may compete with us for business combination opportunities. Our sponsor, officers and directors are not currently aware
+of any specific opportunities for us to complete our initial business combination with any entities with which they are affiliated, and
+there have been no preliminary discussions concerning an initial business combination with any such entity or entities. Although we will
+not be specifically focusing on, or targeting, any transaction with any affiliated entities, we would pursue such a transaction if we
+determined that such affiliated entity met our criteria for an initial business combination as set forth in the section of this prospectus
+entitled "Proposed Business — Selection of a Target Business and Structuring of our Initial Business Combination" and
+such transaction was approved by a majority of our disinterested directors. Despite our agreement to obtain an opinion from an independent
+investment banking firm or another independent entity that commonly renders valuation opinions, regarding the fairness to our stockholders
+from a financial point of view of an initial business combination with one or more businesses affiliated with our sponsor, officers,
+directors or existing holders, potential conflicts of interest still may exist and, as a result, the terms of the initial business combination
+may not be as advantageous to our public stockholders as they would be absent any conflicts of interest.
+
+ 
+
+Since
+our sponsor, officers and directors will lose their entire investment in us if our initial business combination is not completed, a conflict
+of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination.
+
+ 
+
+On
+March 15, 2021, our sponsor purchased an aggregate of 2,875,000 founder shares for an aggregate purchase price of $25,000, or approximately
+$0.009 per share. On November 19, 2021, 718,750 shares
+have been cancelled due to the downsize of the offering,
+resulting in 2,156,250 shares owned by the Sponsor, or approximately $0.01 per share. The number of founder shares issued was
+determined based on the expectation that such founder shares would represent 20% of the outstanding shares after this offering (excluding
+the placement units and securities underlying the foregoing). The founder shares will be worthless if we do not complete an initial business
+combination. Our sponsor has agreed to purchase an aggregate of 346,394 placement units at a price of $10.00 per unit for an aggregate
+purchase price of $3,463,935. If the over-allotment option is exercised in full, the amount of placement units sold will be 377,331
+for an aggregate purchase price of $3,773,310. Each placement unit consists of one share of Class A common stock and one warrant.
+Each warrant is exercisable to purchase one share of common stock at $11.50 per share. These securities will also be worthless if we
+do not complete an initial business combination. Holders of founder shares have agreed (A) to vote any shares owned by them in favor
+of any proposed initial business combination and (B) not to redeem any founder shares or placement shares held by them in connection
+with a stockholder vote to approve a proposed initial business combination. In addition, we may obtain loans from our sponsor, affiliates
+of our sponsor or an officer or director. The personal and financial interests of our officers and directors may influence their motivation
+in identifying and selecting a target business combination, completing an initial business combination and influencing the operation
+of the business following the initial business combination. 
+
+ 53
+
+ 
+
+ 
+
+ 
+
+Risks
+Relating to Our Securities
+
+ 
+
+The
+securities in which we invest the funds held in the trust account could bear a negative rate of interest, which could reduce the value
+of the assets held in trust such that the per-share redemption amount received by public stockholders may be less than $10.15
+per share.
+
+ 
+
+The
+proceeds held in the trust account will be invested only in U.S. government treasury obligations with a maturity of 185 days or less
+or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act, which invest only in direct U.S.
+government treasury obligations. While short-term U.S. government treasury obligations currently yield a positive rate of interest, they
+have briefly yielded negative interest rates in recent years. Central banks in Europe and Japan pursued interest rates below zero in
+recent years, and the Open Market Committee of the Federal Reserve has not ruled out the possibility that it may in the future adopt
+similar policies in the United States. In the event that we are unable to complete our initial business combination or make certain amendments
+to our amended and restated certificate of incorporation, our public stockholders are entitled to receive their pro-rata share of the
+proceeds held in the trust account, plus any interest income, net of taxes paid or payable (less, in the case we are unable to complete
+our initial business combination, $100,000 of interest). Negative interest rates could reduce the value of the assets held in trust such
+that the per-share redemption amount received by public stockholders may be less than $10.15 per share.
+
+ 
+
+Nasdaq
+may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities
+and subject us to additional trading restrictions.
+
+ 
+
+We plan to apply to have our units
+listed on Nasdaq. We expect that our units will be listed on Nasdaq on or promptly after the date of this prospectus. Following the date
+the shares of our Class A common stock and warrants are eligible to trade separately, we anticipate that the shares of our Class A common
+stock and warrants will be separately listed on Nasdaq. We cannot guarantee that our securities will be approved for listing on Nasdaq.
+Although after giving effect to this offering we expect to meet, on a pro forma basis, the minimum initial listing standards set forth
+in the Nasdaq listing standards, we cannot assure you that our securities will be, or will continue to be, listed on Nasdaq in the future
+or prior to our initial business combination. In order to continue listing our securities on Nasdaq prior to our initial business combination,
+we must maintain certain financial, distribution and stock price levels. Generally, based on Nasdaq s current listing standards,
+we must maintain a minimum market value of listed securities of $50,000,000 and a minimum number of holders of our securities
+(generally 400 public holders). Additionally, in connection with our initial business combination, we will be required to demonstrate
+compliance with Nasdaq s initial listing requirements, which are more rigorous than Nasdaq s continued listing requirements,
+in order to continue to maintain the listing of our securities on Nasdaq. For instance, our stock price would generally be required to
+be at least $4.00 per share, the market value of listed securities would be required to be at least $75 million
+(or we would need to satisfy certain stockholders equity or total assets and total revenue requirements) and we would be
+required to have a minimum of 400 round lot holders (with at least 50% of such round lot holders holding securities with a market value
+of at least $2,500) of our securities. We cannot assure you that we will be able to meet those initial listing requirements at that time.
+
+ 
+
+If
+Nasdaq delists our securities from trading on its exchange and we are not able to list our securities on another national securities
+exchange, we expect our securities could be quoted on an over-the-counter market. If this were to occur, we could face significant material
+adverse consequences, including:
+
+ 
+
+ 
+ 
+ a
+ limited availability of market quotations for our securities;
+
+ 
+ 
+ 
+
+ 
+ 
+ reduced
+ liquidity for our securities;
+
+ 
+ 
+ 
+
+ 
+ 
+ a
+ determination that our Class A common stock is a "penny stock" which will require brokers trading in our Class A common
+ stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market
+ for our securities;
+
+ 
+ 
+ 
+
+ 
+ 
+ a
+ limited amount of news and analyst coverage; and
+
+ 
+ 
+ 
+
+ 
+ 
+ a
+ decreased ability to issue additional securities or obtain additional financing in the future.
+
+ 
+
+ 54
+
+ 
+
+ 
+
+ 
+
+The
+National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the
+sale of certain securities, which are referred to as "covered securities." Because we expect that our units and eventually
+our Class A common stock and warrants will be listed on Nasdaq, our units, Class A common stock and warrants will be covered securities.
+Although the states are preempted from regulating the sale of our securities, the federal statute does allow the states to investigate
+companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the
+sale of covered securities in a particular case. While we are not aware of a state having used these powers to prohibit or restrict the
+sale of securities issued by blank check companies, other than the State of Idaho, certain state securities regulators view blank check
+companies unfavorably and might use these powers, or threaten to use these powers, to hinder the sale of securities of blank check companies
+in their states. Further, if we were no longer listed on Nasdaq, our securities would not be covered securities and we would be subject
+to regulation in each state in which we offer our securities, including in connection with our initial business combination.
+
+ 
+
+If
+we seek stockholder approval of our initial business combination and we do not conduct redemptions pursuant to the tender offer rules,
+and if you or a "group" of stockholders are deemed to hold in excess of 15% of our Class A common stock, you will lose the
+ability to redeem all such shares in excess of 15% of our Class A common stock.
+
+ 
+
+If
+we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
+combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder,
+together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a "group"
+(as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect to more than an aggregate
+of 15% of the shares sold in this offering without our prior consent, which we refer to as the "Excess Shares." However,
+we would not be restricting our stockholders ability to vote all of their shares (including Excess Shares) for or against our
+initial business combination. Your inability to redeem the Excess Shares will reduce your influence over our ability to complete our
+initial business combination and you could suffer a material loss on your investment in us if you sell Excess Shares in open market transactions.
+Additionally, you will not receive redemption distributions with respect to the Excess Shares if we complete our initial business combination.
+And as a result, you will continue to hold that number of shares exceeding 15% and, in order to dispose of such shares, would be required
+to sell your stock in open market transactions, potentially at a loss.
+
+ 
+
+ 55
+
+ 
+
+ 
+
+ 
+
+We
+are not registering the shares of Class A common stock issuable upon exercise of the warrants under the Securities Act or any state securities
+laws at this time, and such registration may not be in place when an investor desires to exercise warrants, thus precluding such investor
+from being able to exercise its warrants except on a cashless basis. If the issuance of the shares upon exercise of warrants is not registered,
+qualified or exempt from registration or qualification, the holder of such warrant will not be entitled to exercise such warrant and
+such warrant may have no value and expire worthless.
+
+ 
+
+We
+are not registering the shares of Class A common stock issuable upon exercise of the warrants under the Securities Act or any state securities
+laws at this time. However, under the terms of the warrant agreement, we have agreed that as soon as practicable, but in no event later
+than 15 business days after the closing of our initial business combination, we will use our best efforts to file with the SEC a registration
+statement for the registration under the Securities Act of the issuance of the shares of Class A common stock issuable upon exercise
+of the warrants and thereafter will use our best efforts to cause the same to become effective within 60 business days following our
+initial business combination and to maintain a current prospectus relating to the Class A common stock issuable upon exercise of the
+warrants, until the expiration of the warrants in accordance with the provisions of the warrant agreement. We cannot assure you that
+we will be able to do so if, for example, any facts or events arise which represent a fundamental change in the information set forth
+in the registration statement or prospectus, the financial statements contained or incorporated by reference therein are not current,
+complete or correct or the SEC issues a stop order. If the shares of Class A common stock issuable upon exercise of the warrants are
+not registered under the Securities Act, we will be required to permit holders to exercise their warrants on a cashless basis. However,
+no warrant will be exercisable for cash or on a cashless basis, and we will not be obligated to issue any shares to holders seeking to
+exercise their warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of
+the state of the exercising holder, or an exemption from registration is available. Notwithstanding the foregoing, if a registration
+statement covering the issuance of the Class A common stock issuable upon exercise of the warrants is not effective within a specified
+period following the consummation of our initial business combination, warrant holders may, until such time as there is an effective
+registration statement and during any period when we shall have failed to maintain an effective registration statement, exercise warrants
+on a cashless basis pursuant to the exemption provided by Section 3(a)(9) of the Securities Act, provided that such exemption is available.
+If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a cashless basis. We
+will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available.
+In no event will we be required to net cash settle any warrant, or issue securities or other compensation in exchange for the warrants
+in the event that we are unable to register or qualify the shares underlying the warrants under applicable state securities laws and
+there is no exemption available. If the issuance of the shares upon exercise of the warrants is not so registered or qualified or exempt
+from registration or qualification, the holder of such warrant will not be entitled to exercise such warrant and such warrant may have
+no value and expire worthless. In such event, holders who acquired their warrants as part of a purchase of units will have paid the full
+unit purchase price solely for the shares of Class A common stock included in the units. If and when the warrants become redeemable by
+us, we may not exercise our redemption right if the issuance of shares of common stock upon exercise of the warrants is not exempt from
+registration or qualification under applicable state blue sky laws or we are unable to effect such registration or qualification. We
+will use our best efforts to register or qualify such shares of common stock under the blue sky laws of the state of residence in those
+states in which the warrants were offered by us in this offering. However, there may be instances in which holders of our public warrants
+may be unable to exercise such public warrants but holders of our placement warrants may be able to exercise such placement warrants.
+
+ 
+
+ 56
+
+ 
+
+ 
+
+ 
+
+If
+you exercise your public warrants on a "cashless basis," you will receive fewer shares of Class A common stock from such
+exercise than if you were to exercise such warrants for cash.
+
+ 
+
+There
+are circumstances in which the exercise of the public warrants may be required or permitted to be made on a cashless basis. First, if
+a registration statement covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants is not effective
+by the 60th business day after the closing of our initial business combination, warrant holders may, until such time as there
+is an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act
+or another exemption. Second, if a registration statement covering the Class A common stock issuable upon exercise of the warrants is
+not effective within a specified period following the consummation of our initial business combination, warrant holders may, until such
+time as there is an effective registration statement and during any period when we shall have failed to maintain an effective registration
+statement, exercise warrants on a cashless basis pursuant to the exemption provided by Section 3(a)(9) of the Securities Act, provided
+that such exemption is available; if that exemption, or another exemption, is not available, holders will not be able to exercise their
+warrants on a cashless basis. Third, if we call the public warrants for redemption, our management will have the option to require all
+holders that wish to exercise warrants to do so on a cashless basis. In the event of an exercise on a cashless basis, a holder would
+pay the warrant exercise price by surrendering the warrants for that number of shares of Class A common stock equal to the quotient obtained
+by dividing (x) the product of the number of shares of Class A common stock underlying the warrants, multiplied by the difference between
+the exercise price of the warrants and the "fair market value" (as defined in the next sentence) by (y) the fair market value.
+The "fair market value" for this purpose shall mean the average reported last sale price of the Class A common stock for
+the 10 trading days ending on the third trading day prior to the date on which the notice of exercise is received by the warrant agent
+or on which the notice of redemption is sent to the holders of warrants, as applicable. As a result, you would receive fewer shares of
+Class A common stock from such exercise than if you were to exercise such warrants for cash.
+
+ 
+
+ 57
+
+ 
+
+ 
+
+ 
+
+We
+may issue additional common stock or preferred stock to complete our initial business combination or under an employee incentive plan
+after completion of our initial business combination. We may also issue shares of Class A common stock upon the conversion of the Class
+B common stock at a ratio greater than one-to-one at the time of the consummation of our initial business combination as a result of
+the anti-dilution provisions contained in our amended and restated certificate of incorporation. Any such issuances would dilute the
+interest of our stockholders and likely present other risks.
+
+ 
+
+Our amended and restated certificate
+of incorporation will authorize the issuance of up to 125,000,000 shares of Class A common stock, par value $0.0001 per share, 12,500,000,
+shares of Class B common stock, par value $0.0001 per share, and 1,250,000 shares of preferred stock, par value $0.0001 per share. Immediately
+after this offering and the sale of the placement units there will be 117,116,106 and 10,625,000 (assuming, in each case, that
+the underwriters have not exercised their over-allotment option) authorized but unissued shares of Class A common stock and Class B common
+stock, respectively, available for issuance, which amount does not take into account the shares of Class A common stock reserved for
+issuance upon exercise of outstanding warrants or the shares of Class A common stock issuable upon conversion of Class B common stock.
+Immediately after the consummation of this offering, there will be no shares of preferred stock issued and outstanding. Shares of Class
+B common stock are convertible into shares of our Class A common stock initially at a one-for-one ratio but subject to adjustment as
+set forth herein, including in certain circumstances in which we issue Class A common stock or equity-linked securities related to our
+initial business combination. 
+
+We may issue a substantial number
+of additional shares of common or preferred stock to complete our initial business combination or under an employee incentive plan after
+completion of our initial business combination (although our amended and restated certificate of incorporation will provide that we may
+not issue securities that can vote with common stockholders on matters related to our pre-initial business combination activity). We
+may also issue shares of Class A common stock upon conversion of the Class B common stock at a ratio greater than one-to-one at the time
+of the consummation of our initial business combination as a result of the anti-dilution provisions contained in our amended and restated
+certificate of incorporation. However, our amended and restated certificate of incorporation will provide, among other things, that prior
+to our initial business combination, we may not issue additional shares of capital stock that would entitle the holders thereof to (i)
+receive funds from the trust account or (ii) vote on any initial business combination. These provisions of our amended and restated certificate
+of incorporation, like all provisions of our amended and restated certificate of incorporation, may be amended with the approval of our
+stockholders. However, our executive officers, directors and director nominees have agreed, pursuant to a written agreement with us,
+that they will not propose any amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing
+of our obligation to allow redemption in connection with our initial business combination or certain amendments to our amended and restated
+certificate of incorporation prior thereto or to redeem 100% of our public shares if we do not complete an initial business combination
+within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if extended as described
+elsewhere in this prospectus) or (B) with respect to any other provision relating to stockholders rights or pre-initial business
+combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of common stock upon approval
+of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including
+interest (which interest shall be net of taxes payable), divided by the number of then outstanding public shares.
+
+ 
+
+The
+issuance of additional shares of common or preferred stock:
+
+ 
+
+ 
+ 
+ may
+ significantly dilute the equity interest of investors in this offering, which dilution would increase if the anti-dilution provisions
+ in the Class B common stock resulted in the issuance of Class A shares on a greater than one-to-one basis upon conversion of the
+ Class B common stock;
+
+ 
+ 
+ 
+
+ 
+ 
+ may
+ subordinate the rights of holders of our common stock if preferred stock is issued with rights senior to those afforded our common
+ stock;
+
+ 
+ 
+ 
+
+ 
+ 
+ could
+ cause a change of control if a substantial number of shares of our common stock are issued, which may affect, among other things,
+ our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers
+ and directors;
+
+ 
+ 
+ 
+
+ 
+ 
+ may
+ have the effect of delaying or preventing a change of control of us by diluting the stock ownership or voting rights of a person
+ seeking to obtain control of us; and
+
+ 
+ 
+ 
+
+ 
+ 
+ may
+ adversely affect prevailing market prices for our units, Class A common stock and/or warrants.
+
+ 
+
+ 58
+
+ 
+
+ 
+
+ 
+
+Our
+initial stockholders paid a nominal price for the founders shares and, accordingly, you will experience immediate and substantial
+dilution from the purchase of our shares of common stock.
+
+ 
+
+The difference between the public
+offering price per share (allocating all of the unit purchase price to the Class A common stock and none to the warrants included in
+the unit) and the pro forma net tangible book value per share of our Class A common stock after this offering constitutes the dilution
+to you and the other investors in this offering. Our sponsor acquired the founder shares at a nominal price, significantly contributing
+to this dilution. Upon the closing of this offering, and assuming no value is ascribed to the warrants included in the units, you and
+the other public stockholders will incur an immediate and substantial dilution of approximately $10.66 per share, or 106.6%
+(or $10.72 per share, or 107.2% if the underwriters over-allotment option is exercised in full), the difference
+between the pro forma net tangible book value per share of $(0.66) and the initial offering price of $10.00 per unit. In addition,
+because of the anti-dilution rights of the founder shares, any equity or equity-linked securities issued or deemed issued in connection
+with our initial business combination would be disproportionately dilutive to our Class A common stock. 
+
+Unlike
+many other similarly structured special purpose acquisition companies, our initial stockholders will receive additional shares of Class
+A common stock if we issue shares to consummate an initial business combination.
+
+ 
+
+The
+founder shares will automatically convert into Class A common stock at the time of the consummation of our initial business combination,
+on a one-for-one basis, subject to adjustment as provided herein. In the case that additional shares of Class A common stock, or equity-linked
+securities convertible or exercisable for Class A common stock, are issued or deemed issued in excess of the amounts offered in this
+prospectus and related to the closing of the initial business combination, the ratio at which founder shares shall convert into Class
+A common stock will be adjusted so that the number of Class A common stock issuable upon conversion of all founder shares will equal,
+in the aggregate, on an as-converted basis, 20% of the total number of all outstanding shares of common stock upon completion of the
+initial business combination, excluding the placement units and underlying securities, and any shares or equity-linked securities issued,
+or to be issued, to any seller in the business combination and any private placement-equivalent units and their underlying securities
+issued to our sponsor or its affiliates upon conversion of loans made to us. This is different from most other similarly structured blank
+check companies in which the initial stockholder will only be issued an aggregate of 20% of the total number of shares to be outstanding
+prior to the initial business combination. Additionally, the aforementioned adjustment will not take into account any shares of Class
+A common stock redeemed in connection with the business combination. Accordingly, the holders of the founder shares could receive additional
+shares of Class A common stock even if the additional shares of Class A common stock, or equity-linked securities convertible or exercisable
+for Class A common stock, are issued or deemed issued solely to replace those shares that were redeemed in connection with the business
+combination. The foregoing may make it more difficult and expensive for us to consummate an initial business combination.
+
+ 
+
+We
+may amend the terms of the warrants in a manner that may be adverse to holders of public warrants with the approval by the holders of
+at least a majority of the then outstanding public warrants. As a result, the exercise price of your warrants could be increased, the
+exercise period could be shortened and the number of shares of our Class A common stock purchasable upon exercise of a warrant could
+be decreased, all without your approval.
+
+ 
+
+Our
+warrants will be issued in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant
+agent, and us. The warrant agreement provides that the terms of the warrants may be amended without the consent of any holder to cure
+any ambiguity or correct any mistake, including to conform the provisions of the warrant agreement to the description of the terms of
+the warrants and the warrant agreement set forth in this prospectus, or defective provision, but requires the approval by the holders
+of at least a majority of the then outstanding public warrants to make any change that adversely affects the interests of the registered
+holders of public warrants (which may include public warrants acquired by our sponsor or its affiliates in this offering or thereafter
+in the open market). Accordingly, we may amend the terms of the public warrants in a manner adverse to a holder if holders of at least
+a majority of the then outstanding public warrants approve of such amendment. Although our ability to amend the terms of the public warrants
+with the consent of at least a majority of the then outstanding public warrants is unlimited, examples of such amendments could be amendments
+to, among other things, increase the exercise price of the warrants, convert the warrants into cash or stock, shorten the exercise period
+or decrease the number of shares of our Class A common stock purchasable upon exercise of a warrant.
+
+ 
+
+ 59
+
+ 
+
+ 
+
+ 
+
+Our
+warrant agreement will designate the courts of the State of New York or the United States District Court for the Southern District of
+New York as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by holders of our warrants,
+which could limit the ability of warrant holders to obtain a favorable judicial forum for disputes with our company.
+
+ 
+
+Our
+warrant agreement will provide that, subject to applicable law, (i) any action, proceeding or claim against us arising out of or relating
+in any way to the warrant agreement, including under the Securities Act, will be brought and enforced in the courts of the State of New
+York or the United States District Court for the Southern District of New York, and (ii) that we irrevocably submit to such jurisdiction,
+which jurisdiction shall be the exclusive forum for any such action, proceeding or claim. We will waive any objection to such exclusive
+jurisdiction and that such courts represent an inconvenient forum.
+
+ 
+
+Notwithstanding
+the foregoing, these provisions of the warrant agreement will not apply to suits brought to enforce any liability or duty created by
+the Exchange Act or any other claim for which the federal district courts of the United States of America are the sole and exclusive
+forum. Any person or entity purchasing or otherwise acquiring any interest in any of our warrants shall be deemed to have notice of and
+to have consented to the forum provisions in our warrant agreement. If any action, the subject matter of which is within the scope the
+forum provisions of the warrant agreement, is filed in a court other than a court of the State of New York or the United States District
+Court for the Southern District of New York (a "foreign action") in the name of any holder of our warrants, such holder shall
+be deemed to have consented to: (x) the personal jurisdiction of the state and federal courts located in the State of New York in connection
+with any action brought in any such court to enforce the forum provisions (an "enforcement action"), and (y) having service
+of process made upon such warrant holder in any such enforcement action by service upon such warrant holder s counsel in the foreign
+action as agent for such warrant holder.
+
+ 
+
+This
+choice-of-forum provision may limit a warrant holder s ability to bring a claim in a judicial forum that it finds favorable for
+disputes with our company, which may discourage such lawsuits. Alternatively, if a court were to find this provision of our warrant agreement
+inapplicable or unenforceable with respect to one or more of the specified types of actions or proceedings, we may incur additional costs
+associated with resolving such matters in other jurisdictions, which could materially and adversely affect our business, financial condition
+and results of operations and result in a diversion of the time and resources of our management and board of directors.
+
+ 
+
+We
+may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.
+
+ 
+
+We
+have the ability to redeem outstanding warrants at any time after they become exercisable and prior to their expiration, at a price of
+$0.01 per warrant, provided that the reported last sale price of our Class A common stock equals or exceeds $18.00 per share (as adjusted
+for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30 trading-day period
+commencing once the warrants become exercisable and ending on the third trading day prior to the date on which we give proper notice
+of such redemption and provided certain other conditions are met. If and when the warrants become redeemable by us, we may not exercise
+our redemption right if the issuance of shares of common stock upon exercise of the warrants is not exempt from registration or qualification
+under applicable state blue sky laws or we are unable to effect such registration or qualification. We will use our best efforts to register
+or qualify such shares of common stock under the blue sky laws of the state of residence in those states in which the warrants were offered
+by us in this offering. Redemption of the outstanding warrants could force you (i) to exercise your warrants and pay the exercise price
+therefor at a time when it may be disadvantageous for you to do so, (ii) to sell your warrants at the then-current market price when
+you might otherwise wish to hold your warrants or (iii) to accept the nominal redemption price which, at the time the outstanding warrants
+are called for redemption, is likely to be substantially less than the market value of your warrants. None of the placement warrants
+will be redeemable by us so long as they are held by the sponsor or its permitted transferees.
+
+ 
+
+ 60
+
+ 
+
+ 
+
+ 
+
+Our
+warrants and founder shares may have an adverse effect on the market price of our Class A common stock and make it more difficult to
+effectuate our initial business combination.
+
+ 
+
+We will be issuing warrants to
+purchase 7,500,000 shares of our Class A common stock (or up to 8,625,000 shares of Class A common stock if the underwriters 
+over-allotment option is exercised in full) as part of the units offered by this prospectus and, simultaneously with the closing of this
+offering, we will be issuing placement units, in a private placement, consisting of an aggregate of 346,394 placement warrants
+(or 377,331 if the over-allotment option is exercised in full). Our initial stockholders currently own an aggregate of 2,156,250
+ founder shares. The founder shares are convertible into shares of Class A common stock on a one-for-one basis, subject to adjustment
+as set forth herein. In addition, if our sponsor makes any working capital loans, up to $1,500,000 of such loans may be converted into
+units, at a price of $10.00 per unit at the option of the lender, upon consummation of our initial business combination. The units would
+be identical to the placement units. To the extent we issue shares of Class A common stock to effectuate an initial business combination,
+the potential for the issuance of a substantial number of additional shares of Class A common stock upon exercise of these warrants and
+loan conversion rights could make us a less attractive business combination vehicle to a target business. Any such issuance will increase
+the number of issued and outstanding shares of our Class A common stock and reduce the value of the shares of Class A common stock issued
+to complete the initial business combination. Therefore, our warrants and founder shares may make it more difficult to effectuate an
+initial business combination or increase the cost of acquiring the target business. 
+
+The
+placement warrants included in the placement units are identical to the warrants sold as part of the units in this offering except that,
+so long as they are held by our sponsor or its permitted transferees, (i) they will not be redeemable by us, (ii) they (including the
+Class A common stock issuable upon exercise of these warrants) may not, subject to certain limited exceptions, be transferred, assigned
+or sold by the holders until 30 days after the completion of our initial business combination, (iii) they may be exercised by the holders
+on a cashless basis, and (iv) will be entitled to registration rights.
+
+ 
+
+A
+provision of our warrant agreement may make it more difficult for us to consummate an initial business combination.
+
+ 
+
+Unlike
+most blank check companies, if
+
+ 
+
+ 
+ (i)
+ we
+ issue additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection with the closing
+ of our initial business combination at a Newly Issued Price of less than $9.20 per share;
+
+ 
+ 
+ 
+
+ 
+ (ii)
+ the
+ aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available
+ for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions),
+ and
+
+ 
+ 
+ 
+
+ 
+ (iii)
+ the
+ Market Value is below $9.20 per share,
+
+ 
+
+then
+the exercise price of the warrants will be adjusted to be equal to 115% of the greater of the Market Value and the Newly Issued Price,
+and the $18.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to 180% of the greater of the Market
+Value and the Newly Issued Price. This may make it more difficult for us to consummate an initial business combination with a target
+business.
+
+ 
+
+The
+determination of the offering price of our units, the size of this offering and the terms of the units is more arbitrary than the pricing
+of securities and size of an offering of an operating company in a particular industry. You may have less assurance, therefore, that
+the offering price of our units properly reflects the value of such units than you would have in a typical offering of an operating company.
+
+ 
+
+Prior
+to this offering there has been no public market for any of our securities. The public offering price of the units and the terms of the
+warrants were negotiated between us and the underwriters. In determining the size of this offering, management held customary organizational
+meetings with the representative of the underwriters, both prior to our inception and thereafter, with respect to the state of capital
+markets, generally, and the amount the underwriters believed they reasonably could raise on our behalf. Factors considered in determining
+the size of this offering, prices and terms of the units, including the Class A common stock and warrants underlying the units, include:
+
+ 
+
+ 
+ 
+ 
+ the
+ history and prospects of companies whose principal business is the acquisition of other companies;
+
+ 
+
+ 61
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ prior
+ offerings of those companies;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ prospects for acquiring an operating business;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ a
+ review of debt to equity ratios in leveraged transactions;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ capital structure;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an
+ assessment of our management and their experience in identifying operating companies;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ general
+ conditions of the securities markets at the time of this offering; and
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ other
+ factors as were deemed relevant.
+
+ 
+
+Although
+these factors were considered, the determination of our offering price, size and terms of the units is more arbitrary than the pricing
+of securities of an operating company in a particular industry since we have no historical operations or financial results.
+
+ 
+
+There
+is currently no market for our securities and a market for our securities may not develop, which would adversely affect the liquidity
+and price of our securities.
+
+ 
+
+There
+is currently no market for our securities. Stockholders therefore have no access to information about prior market history on which to
+base their investment decision. Following this offering, the price of our securities may vary significantly due to one or more potential
+business combinations and general market or economic conditions. Furthermore, an active trading market for our securities may never develop
+or, if developed, it may not be sustained. You may be unable to sell your securities unless a market can be established and sustained.
+
+ 
+
+Provisions
+in our amended and restated certificate of incorporation and Delaware law may inhibit a takeover of us, which could limit the price investors
+might be willing to pay in the future for our Class A common stock and could entrench management.
+
+ 
+
+Our
+amended and restated certificate of incorporation will contain provisions that may discourage unsolicited takeover proposals that stockholders
+may consider to be in their best interests. These provisions include a staggered board of directors and the ability of the board of directors
+to designate the terms of and issue new series of preferred shares, which may make the removal of management more difficult and may discourage
+transactions that otherwise could involve payment of a premium over prevailing market prices for our securities.
+
+ 
+
+We
+are also subject to anti-takeover provisions under Delaware law, which could delay or prevent a change of control. Together these provisions
+may make the removal of management more difficult and may discourage transactions that otherwise could involve payment of a premium over
+prevailing market prices for our securities.
+
+ 
+
+ 62
+
+ 
+
+ 
+
+ 
+
+Our
+amended and restated certificate of incorporation will require, to the fullest extent permitted by law, that derivative actions brought
+in our name, actions against our directors, officers, other employees or stockholders for breach of fiduciary duty and certain other
+actions may be brought only in the Court of Chancery in the State of Delaware and, if brought outside of Delaware, the stockholder bringing
+the suit will, subject to certain exceptions, be deemed to have consented to service of process on such stockholder s counsel,
+which may have the effect of discouraging lawsuits against our directors, officers, other employees or stockholders.
+
+ 
+
+Our
+amended and restated certificate of incorporation will require, to the fullest extent permitted by law, that derivative actions brought
+in our name, actions against our directors, officers, other employees or stockholders for breach of fiduciary duty and certain other
+actions may be brought only in the Court of Chancery in the State of Delaware and, if brought outside of Delaware, the stockholder bringing
+the suit will be deemed to have consented to service of process on such stockholder s counsel except any action (A) as to which
+the Court of Chancery in the State of Delaware determines that there is an indispensable party not subject to the jurisdiction of the
+Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days
+following such determination), (B) which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery
+or (C) for which the Court of Chancery does not have subject matter jurisdiction. Any person or entity purchasing or otherwise acquiring
+any interest in shares of our capital stock shall be deemed to have notice of and consented to the forum provisions in our amended and
+restated certificate of incorporation. This choice of forum provision may limit or make more costly a stockholder s ability to
+bring a claim in a judicial forum that it finds favorable for disputes with us or any of our directors, officers, other employees or
+stockholders, which may discourage lawsuits with respect to such claims. Alternatively, if a court were to find the choice of forum provision
+contained in our amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional
+costs associated with resolving such action in other jurisdictions, which could harm our business, operating results and financial condition.
+
+ 
+
+Our
+amended and restated certificate of incorporation will provide that the exclusive forum provision will be applicable to the fullest extent
+permitted by applicable law, subject to certain exceptions. Section 27 of the Exchange Act creates exclusive federal jurisdiction over
+all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. As a result,
+the exclusive forum provision will not apply to suits brought to enforce any duty or liability created by the Exchange Act or any other
+claim for which the federal courts have exclusive jurisdiction. In addition, our amended and restated certificate of incorporation provides
+that, unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States of America
+shall, to the fullest extent permitted by law, be the exclusive forum for the resolution of any complaint asserting a cause of action
+arising under the Securities Act, or the rules and regulations promulgated thereunder. We note, however, that there is uncertainty as
+to whether a court would enforce this provision and that investors cannot waive compliance with the federal securities laws and the rules
+and regulations thereunder. Section 22 of the Securities Act creates concurrent jurisdiction for state and federal courts over all suits
+brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder.
+
+ 
+
+General
+Risk Factors
+
+ 
+
+We
+are a newly formed company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve
+our business objective.
+
+ 
+
+We
+are a newly formed company with no operating results, and we will not commence operations until obtaining funding through this offering.
+Because we lack an operating history, you have no basis upon which to evaluate our ability to achieve our business objective of completing
+our initial business combination with one or more target businesses. We have no plans, arrangements or understandings with any prospective
+target business concerning an initial business combination and may be unable to complete our initial business combination. If we fail
+to complete our initial business combination, we will never generate any operating revenues.
+
+ 
+
+Our
+independent registered public accounting firm s report contains an explanatory paragraph that expresses substantial doubt about
+our ability to continue as a "going concern."
+
+ 
+
+On September 30, 2021 and
+March 15, 2021, we had cash of $9,830 and $14,925, and working deficit of $99,148 and $36,683, respectively. Further,
+we have incurred and expect to continue to incur significant costs in pursuit of our financing and acquisition plans.
+Management s plans to address this need for capital through this offering are discussed in the section of this prospectus
+titled "Management s Discussion and Analysis of Financial Condition and Results of Operations." We cannot assure
+you that our plans to raise capital or to consummate an initial business combination will be successful. These factors, among
+others, raise substantial doubt about our ability to continue as a going concern. The financial statements contained elsewhere in
+this prospectus do not include any adjustments that might result from our inability to consummate this offering or our inability to
+continue as a going concern.
+
+ 
+
+ 63
+
+ 
+
+ 
+
+ 
+
+Changes
+in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, including our ability
+to negotiate and complete our initial business combination and results of operations.
+
+ 
+
+We
+are subject to laws and regulations enacted by national, regional and local governments. In particular, we will be required to comply
+with certain SEC and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations may be difficult,
+time consuming and costly. Those laws and regulations and their interpretation and application may also change from time to time and
+those changes could have a material adverse effect on our business, investments and results of operations. In addition, a failure to
+comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business, including
+our ability to negotiate and complete our initial business combination and results of operations.
+
+ 
+
+Past
+performance by our management team may not be indicative of future performance of an investment in us.
+
+ 
+
+Past
+performance by our management team is not a guarantee either (i) of success with respect to any business combination we may consummate
+or (ii) that we will be able to locate a suitable candidate for our initial business combination. You should not rely on the historical
+record of our management team s performance as indicative of our future performance of an investment in the company or the returns
+the company will, or is likely to, generate going forward. Additionally, in the course of their
+respective careers, members of our management team have been involved in businesses and deals that were unsuccessful.
+
+ 
+
+Cyber
+incidents or attacks directed at us could result in information theft, data corruption, operational disruption and/or financial loss.
+
+ 
+
+We
+depend on digital technologies, including information systems, infrastructure and cloud applications and services, including those of
+third parties with which we may deal. Sophisticated and deliberate attacks on, or security breaches in, our systems or infrastructure,
+or the systems or infrastructure of third parties or the cloud, could lead to corruption or misappropriation of our assets, proprietary
+information and sensitive or confidential data. As an early stage company without significant investments in data security protection,
+we may not be sufficiently protected against such occurrences. We may not have sufficient resources to adequately protect against, or
+to investigate and remediate any vulnerability to, cyber incidents. It is possible that any of these occurrences, or a combination of
+them, could have adverse consequences on our ability to consummate a business combination and lead to financial loss.
+
+ 
+
+We
+may face risks related to companies in the technology sector.
+
+ 
+
+Business
+combinations with companies in the technology sector (where we plan to search for our initial business combination target) entail special
+considerations and risks. If we are successful in completing a business combination with such a target business, we may be subject to,
+and possibly adversely affected by, the following risks:
+
+ 
+
+ 
+ 
+ an
+ inability to compete effectively in a highly competitive environment with many incumbents having substantially greater resources;
+
+ 
+ 
+ 
+
+ 
+ 
+ an
+ inability to manage rapid change, increasing consumer expectations and growth;
+
+ 
+ 
+ 
+
+ 
+ 
+ an
+ inability to build strong brand identity and improve subscriber or customer satisfaction and loyalty;
+
+ 
+ 
+ 
+
+ 
+ 
+ a
+ reliance on proprietary technology to provide services and to manage our operations, and the failure of this technology to operate
+ effectively, or our failure to use such technology effectively;
+
+ 
+ 
+ 
+
+ 
+ 
+ an
+ inability to deal with our subscribers or customers privacy concerns;
+
+ 
+ 
+ 
+
+ 
+ 
+ an
+ inability to attract and retain subscribers or customers;
+
+ 
+ 
+ 
+
+ 
+ 
+ an
+ inability to license or enforce intellectual property rights on which our business may depend;
+
+ 
+ 
+ 
+
+ 
+ 
+ any
+ significant disruption in our computer systems or those of third parties that we would utilize in our operations;
+
+ 
+ 
+ 
+
+ 
+ 
+ an
+ inability by us, or a refusal by third parties, to license content to us upon acceptable terms;
+
+ 
+ 
+ 
+
+ 
+ 
+ potential
+ liability for negligence, copyright or trademark infringement or other claims based on the nature and content of materials that we
+ may distribute;
+
+ 
+ 
+ 
+
+ 
+ 
+ competition
+ for advertising revenue;
+
+ 
+ 
+ 
+
+ 
+ 
+ competition
+ for the leisure and entertainment time and discretionary spending of subscribers or customers, which may intensify in part due to
+ advances in technology and changes in consumer expectations and behavior;
+
+ 
+ 
+ 
+
+ 
+ 
+ disruption
+ or failure of our networks, systems or technology as a result of computer viruses, "cyber-attacks," misappropriation
+ of data or other malfeasance, as well as outages, natural disasters, terrorist attacks, accidental releases of information or similar
+ events;
+
+ 
+ 
+ 
+
+ 
+ 
+ an
+ inability to obtain necessary hardware, software and operational support; and
+
+ 
+ 
+ 
+
+ 
+ 
+ reliance
+ on third-party vendors or service providers.
+
+ 
+
+Any
+of the foregoing could have an adverse impact on our business, financial condition and results of operations following a business combination.
+
+ 
+
+We
+are an emerging growth company and a smaller reporting company within the meaning of the rules adopted by the Securities and Exchange
+Commission, and if we take advantage of certain exemptions from disclosure requirements available to emerging growth companies and smaller
+reporting companies, this could make our securities less attractive to investors and may make it more difficult to compare our performance
+with other public companies.
+
+ 
+
+We
+are an "emerging growth company" within the meaning of the rules adopted by the Securities and Exchange Commission, as modified
+by the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public
+companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor internal
+controls attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation
+in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive
+compensation and stockholder approval of any golden parachute payments not previously approved. As a result, our stockholders may not
+have access to certain information they may deem important. We could be an emerging growth company for up to five years, although circumstances
+could cause us to lose that status earlier, including if the market value of our Class A common stock held by non-affiliates exceeds
+$700 million as of any June 30 before that time, in which case we would no longer be an emerging growth company as of the following December
+31. We cannot predict whether investors will find our securities less attractive because we will rely on these exemptions. If some investors
+find our securities less attractive as a result of our reliance on these exemptions, the trading prices of our securities may be lower
+than they otherwise would be, there may be a less active trading market for our securities and the trading prices of our securities may
+be more volatile.
+
+ 
+
+Further,
+Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting
+standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do
+not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting
+standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements
+that apply to non-emerging growth companies but any such an election to opt out is irrevocable. We have elected not to opt out of such
+extended transition period, which means that when a standard is issued or revised and it has different application dates for public or
+private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new
+or revised standard. This may make comparison of our financial statements with another public company which is neither an emerging growth
+company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of
+the potential differences in accounting standards used.
+
+ 
+
+Additionally, we are a "smaller
+reporting company" as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain
+reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain
+a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates
+equals or exceeds $250 million as of the end of the prior June 30th and our annual
+revenues equaled or exceeded $100 million during such completed fiscal year, or (2) the market value of our common stock held
+by non-affiliates exceeds $700 million as of the prior June 30th. To the extent we
+take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies
+difficult or impossible.
+
+ 
+
+ 64
+
+ 
+
+ 
+
+ 
+
+CAUTIONARY
+NOTE REGARDING FORWARD-LOOKING STATEMENTS
+
+ 
+
+Certain
+statements in this prospectus may constitute "forward-looking statements" for purposes of the federal securities laws. Our
+forward-looking statements include, but are not limited to, statements regarding our or our management team s expectations, hopes,
+beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations
+of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words "anticipate,"
+"believe," "continue," "could," "estimate," "expect," "intend,"
+"may," "might," "plan," "possible," "potential," "predict," "project,"
+"should," "would" and similar expressions may identify forward-looking statements, but the absence of these words
+does not mean that a statement is not forward-looking. Forward-looking statements in this prospectus may include, for example, statements
+about:
+
+ 
+
+ 
+ 
+ our
+ ability to select an appropriate target business or businesses in our target industry or otherwise;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ ability to complete our initial business combination in our target industry or otherwise;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ expectations around the performance of the prospective target business or businesses in the technology industry;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business
+ combination;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or
+ in approving our initial business combination, as a result of which they would then receive expense reimbursements;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ potential ability to obtain additional financing to complete our initial business combination;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ pool of prospective target businesses in the technology, software and other industries that we focus on;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ ability to consummate an initial business combination due to the uncertainty resulting from the recent COVID-19 pandemic;
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ ability of our officers and directors to generate a number of potential business combination opportunities;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ public securities potential liquidity and trading;
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ lack of a market for our securities;
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ use of proceeds not held in the trust account or available to us from interest income on the trust account balance;
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ trust account not being subject to claims of third parties; or
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ financial performance following this offering.
+
+ 
+
+The
+forward-looking statements contained in this prospectus are based on our current expectations and beliefs concerning future developments
+and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated.
+These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions
+that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements.
+These risks and uncertainties include, but are not limited to, those factors described under the section of this prospectus entitled
+"Risk Factors." Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect,
+actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to
+update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be
+required under applicable securities laws.
+
+ 
+
+INDUSTRY
+AND MARKET DATA
+
+ 
+
+In
+addition to the industry, market and competitive position data referenced in this prospectus from our own internal research and
+estimates, some market data and other statistical information included in this prospectus are based in part upon information obtained
+from third-party industry publications, research, surveys and studies, none of which we commissioned. Third-party industry publications,
+research, surveys and studies generally indicate that their information has been obtained from sources believed to be reliable,
+although they do not guarantee the accuracy or completeness of such information.
+
+ 
+
+We
+are responsible for all of the disclosure in this prospectus and while we believe that each of the publications, research, surveys
+and studies included in this prospectus are prepared by reputable sources, neither we nor the underwriters have independently
+verified market and industry data from third-party sources.
+
+ 
+
+Certain
+information in the text of this prospectus is contained in independent industry publications. The source of certain of these independent
+industry publications is provided below:
+
+ 
+
+ 
+ 
+ Pitchbook
+
+ 
+ 
+ EvaluatePharma
+
+ 
+ 
+ the
+ United Nations
+
+ 
+ 
+ U.S.
+ Centers for Medicare and Medicaid Services
+
+ 
+
+In
+addition, while we believe our own internal research and estimates are reliable, such research and estimates have not been verified
+by independent sources. Assumptions and estimates of our and our industry s future performance are necessarily subject to
+a high degree of uncertainty and risk due to a variety of factors, including those described in "Risk Factors," and
+you are cautioned not to give undue weight to such information. These and other factors could cause our future performance to
+differ materially from our assumptions and estimates. See "Cautionary Note Regarding Forward-Looking Statements."
+
+ 
+
+ 65
+
+ 
+
+ 
+
+ 
+
+USE
+OF PROCEEDS
+
+ 
+
+We
+are offering 7,500,000 units at an offering price of $10.00 per unit. We estimate that the net proceeds of this offering together
+with the funds we will receive from the sale of the placement units will be used as set forth in the following table.
+
+ 
+
+ 
+ 
+ 
+ Without
+ 
+
+ Over-Allotment 
+
+ Option
+ 
+ 
+ Over-Allotment
+ 
+
+ Option Fully 
+
+ Exercised
+ 
+
+ 
+ Gross
+ proceeds
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Gross
+ proceeds from units offered to public(1)
+ 
+ $
+ 75,000,000
+ 
+ 
+ $
+ 86,250,000
+ 
+
+ 
+ Gross
+ proceeds from placement units offered in the private placement to the sponsor
+ 
+ 
+ 3,463,935
+ 
+ 
+ 
+ 3,773,310
+ 
+
+ 
+ Total
+ gross proceeds
+ 
+ $
+ 78,463,935
+ 
+ 
+ $
+ 90,023,310
+ 
+
+ 
+ Estimated
+ Offering expenses(2)
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Underwriting
+ commissions (1.25% of gross proceeds from units offered to public, excluding deferred portion)(3)
+ 
+ $
+ 937,500
+ 
+ 
+ $
+ 1,078,125
+ 
+
+ 
+ Legal
+ fees and expenses
+ 
+ 
+ 200,000
+ 
+ 
+ 
+ 200,000
+ 
+
+ 
+ Accounting
+ fees and expenses
+ 
+ 
+ 40,000
+ 
+ 
+ 
+ 40,000
+ 
+
+ 
+ SEC/FINRA
+ Expenses
+ 
+ 
+ 21,435
+ 
+ 
+ 
+ 21,435
+ 
+
+ 
+ Reimbursement
+ to underwriters for expenses
+ 
+ 
+ 100,000
+ 
+ 
+ 
+ 100,000
+ 
+
+ 
+ Nasdaq
+ listing and filing fees
+ 
+ 
+ 75,000
+ 
+ 
+ 
+ 75,000
+ 
+
+ 
+ Printing
+ and engraving expenses
+ 
+ 
+ 5,000
+ 
+ 
+ 
+ 5,000
+ 
+
+ 
+ Miscellaneous,
+ including listing and filing fees
+ 
+ 
+ 10,000
+ 
+ 
+ 
+ 10,000
+ 
+
+ 
+ Total
+ offering expenses (excluding underwriting commissions)
+ 
+ $
+ 451,435
+ 
+ 
+ $
+ 451,435
+ 
+
+ 
+ Proceeds
+ after estimated offering expenses
+ 
+ $
+ 77,075,000
+ 
+ 
+ $
+ 88,493,750
+ 
+
+ 
+ Held
+ in trust account(3)
+ 
+ $
+ 76,125,000
+ 
+ 
+ $
+ 87,543,750
+ 
+
+ 
+ %
+ of public offering size
+ 
+ 
+ 101.50
+ %
+ 
+ 
+ 101.50
+ %
+
+ 
+ Not
+ held in trust account
+ 
+ $
+ 950,000
+ 
+ 
+ $
+ 950,000
+ 
+
+ 
+ 
+
+The
+following table shows the use of the approximately $950,000 of net proceeds not held in the trust account.(4)
+
+ 
+
+ 
+ 
+ 
+ Amount
+ 
+ 
+ %
+ of Total
+ 
+
+ 
+ Legal,
+ accounting, due diligence, travel, and other expenses in connection with any business combination(5)
+ 
+ $
+ 300,000
+ 
+ 
+ 
+ 31.6
+ %
+
+ 
+ Legal
+ and accounting fees related to regulatory reporting obligations
+ 
+ 
+ 100,000
+ 
+ 
+ 
+ 10.5
+ %
+
+ 
+ Payment
+ for office space, utilities and secretarial and administrative support ($10,000 per month for 18 months) (6)
+ 
+ 
+ 180,000 
+ 
+ 
+ 
+ 18.9 
+ %
+
+ 
+ Director
+ and Officer liability insurance premiums
+ 
+ 
+ 350,000
+ 
+ 
+ 
+ 36.8
+ %
+
+ 
+ Working
+capital to cover miscellaneous expenses
+ 
+ 
+ 20,000 
+ 
+ 
+ 
+ 2.2 
+ %
+
+ 
+ Total
+ 
+ $
+ 950,000
+ 
+ 
+ 
+ 100.0
+ %
+
+ 
+ 
+
+ (1)
+ Includes
+ amounts payable to public stockholders who properly redeem their shares in connection with our successful completion of our initial
+ business combination.
+
+ 
+ 
+
+ (2)
+ A
+ portion of the offering expenses will be paid from the proceeds of loans from our sponsor of up to $300,000 as described in this
+ prospectus. As of September 30, 2021, we had borrowed $108,978 under the promissory note with our sponsor. These amounts will be
+ repaid upon completion of this offering out of the $950,000 of offering proceeds that has been allocated for the payment of
+ offering expenses (other than underwriting commissions). In the event that offering expenses are more than as set forth in this table,
+ they will be repaid using a portion of the $950,000 of offering proceeds not held in the trust account and set aside for post-closing
+ working capital expenses. In the event that offering expenses are less than set forth in this table, any such amounts will be used
+ for post-closing working capital expenses.
+
+ 
+
+ 66
+
+ 
+
+ 
+
+ 
+
+ (3)
+ The
+ underwriters have agreed to defer underwriting commissions equal to 3.25% of the gross proceeds of this offering. Upon completion
+ of our initial business combination, $2,437,500, which constitutes the underwriters deferred commissions (or $2,803,125
+ if the underwriters over-allotment option is exercised in full) will be paid to the underwriters from the funds held in
+ the trust account, and the remaining funds, less amounts released to the trustee to pay redeeming stockholders, will be released
+ to us and can be used to pay all or a portion of the purchase price of the business or businesses with which our initial business
+ combination occurs or for general corporate purposes, including payment of principal or interest on indebtedness incurred in connection
+ with our initial business combination, to fund the purchases of other companies or for working capital. The underwriters will not
+ be entitled to any interest accrued on the deferred underwriting discounts and commissions.
+
+ 
+ 
+
+ (4)
+ These
+ expenses are estimates only. Our actual expenditures for some or all of these items may differ from the estimates set forth herein.
+ For example, we may incur greater legal and accounting expenses than our current estimates in connection with negotiating and structuring
+ our initial business combination based upon the level of complexity of such business combination. In the event we identify an initial
+ business combination target in a specific industry subject to specific regulations, we may incur additional expenses associated with
+ legal due diligence and the engagement of special legal counsel. In addition, our staffing needs may vary and as a result, we may
+ engage a number of consultants to assist with legal and financial due diligence. We do not anticipate any change in our intended
+ use of proceeds, other than fluctuations among the current categories of allocated expenses, which fluctuations, to the extent they
+ exceed current estimates for any specific category of expenses, would not be available for our expenses.
+
+ 
+ 
+
+ (5)
+ Includes
+ estimated amounts that may also be used in connection with our initial business combination to fund a "no shop" provision
+ and commitment fees for financing.
+
+ 
+ 
+
+ (6)
+ Reflects
+ payments of up to 18 months and assumes that we are able to complete a business
+ combination prior to the end of 18 months from completion of this offering including
+ the possibility of two (2) three-month extension periods or a total of 18 months from the
+ closing of the initial public offering. 
+
+ 
+
+The rules of Nasdaq provide that
+at least 90% of the gross proceeds from this offering and the sale of the private placement units be deposited in a trust account. Of
+the net proceeds of this offering and the sale of the placement units, $76,125,000 (or $87,543,750 if the underwriters over-allotment
+option is exercised in full), including $2,437,500 (or $2,803,125 if the underwriters over-allotment option is exercised in full)
+of deferred underwriting commissions, will be placed in a trust account in the United States with Continental Stock Transfer & Trust
+Company acting as trustee and J.P. Morgan Securities LLC acting as investment manager, and will be invested only in U.S. government treasury
+bills with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company
+Act which invest only in direct U.S. government treasury obligations. We estimate that the pre-tax interest earned on the trust account
+will be approximately $76,000 per year, assuming an interest rate of 0.1% per year; however, we can provide no assurance regarding this
+amount. $950,000, which amount will not be placed in a trust account, will be used to pay expenses in connection with the closing of
+this offering (including the portion of the underwriting commissions payable upon closing of this offering) and for working capital following
+this offering. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our tax
+obligations and up to $100,000 of interest that may be used for our dissolution expenses, the proceeds from this offering and the sale
+of the placement units will not be released from the trust account until the earliest to occur of: (a) the completion of our initial
+business combination, (b) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended
+and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with
+our initial business combination or certain amendments to our amended and restated certificate of incorporation prior thereto or to redeem
+100% of our public shares if we do not complete an initial business combination within 12 months from the closing of this offering (or
+up to 18 months from the closing of this offering if extended as described elsewhere in this prospectus) or (B) with respect to
+any other provision relating to stockholders rights or pre-initial business combination activity, and (c) the redemption of our
+public shares if we are unable to complete our initial business combination within 12 months from the closing of this offering
+(or up to 18 months from the closing of this offering if extended as described elsewhere in this prospectus), subject to applicable
+law.
+
+ 
+
+The
+net proceeds held in the trust account may be used as consideration to pay the sellers of a target business with which we ultimately
+complete our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all
+of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination,
+we may apply the balance of the cash released from the trust account for general corporate purposes, including for maintenance or expansion
+of operations of the post-transaction company, the payment of principal or interest due on indebtedness incurred in completing our initial
+business combination, to fund the purchase of other companies or for working capital. There is no limitation on our ability to raise
+funds privately or through loans in connection with our initial business combination.
+
+ 
+
+ 67
+
+ 
+
+ 
+
+ 
+
+We
+believe that amounts not held in trust will be sufficient to pay the costs and expenses to which such proceeds are allocated. This belief
+is based on the fact that while we may begin preliminary due diligence of a target business in connection with an indication of interest,
+we intend to undertake in-depth due diligence, depending on the circumstances of the relevant prospective business combination, only
+after we have negotiated and signed a letter of intent or other preliminary agreement that addresses the terms of an initial business
+combination. However, if our estimate of the costs of undertaking in-depth due diligence and negotiating an initial business combination
+is less than the actual amount necessary to do so, we may be required to raise additional capital, the amount, availability and cost
+of which is currently unascertainable. If we are required to seek additional capital, we could seek such additional capital through loans
+or additional investments from our sponsor, members of our management team or their affiliates, but such persons are not under any obligation
+to advance funds to, or invest in, us.
+
+ 
+
+Commencing
+on the date of this prospectus, we have agreed to pay Genesis Unicorn Capital, LLC, our sponsor, a total of $10,000 per
+month for office space, utilities and secretarial and administrative support. Upon completion of our initial business combination or
+our liquidation, we will cease paying these monthly fees.
+
+ 
+
+Prior to the closing of this offering,
+our sponsor has agreed to loan us up to $300,000 to be used for a portion of the expenses of this offering. As of September 30, 2021,
+we had borrowed $108,978 under the promissory note with our sponsor. These loans are non-interest bearing, unsecured and pursuant
+to that certain Amended and Restated Promissory Note dated as of February 4, 2022, are due at the earlier of March 31, 2022 or the
+closing of this offering. The loan will be repaid upon the closing of this offering out of the offering proceeds not held in the trust
+account. 
+
+In addition, in order to
+finance transaction costs in connection with an intended initial business combination, our sponsor or an affiliate of our sponsor or
+certain of our officers and directors may, but are not obligated to, loan us funds on a non-interest bearing basis as may be
+required. If we complete our initial business combination, we would repay such loaned amounts out of the proceeds of the trust
+account released to us. Otherwise, such loans would be repaid only out of funds held outside the trust account. In the event that
+our initial business combination does not close, we may use a portion of the working capital held outside the trust account to repay
+such loaned amounts but no proceeds from our trust account would be used to repay such loaned amounts. Up to $1,500,000 of such
+loans (excluding any amounts lent by our sponsor or not paid to our sponsor for payment of the administrative fee of $10,000 per
+month after the 15th month) may be convertible into units, at a price of $10.00 per unit at the option of the lender, upon consummation of our
+initial business combination. The units would be identical to the placement units. Other than as described above, the terms of such
+loans by our officers and directors, if any, have not been determined and no written agreements exist with respect to such loans. We
+do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not believe third parties
+will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our trust account.
+
+ 
+
+If
+we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
+combination pursuant to the tender offer rules, our sponsor, initial stockholders, directors, officers, advisors or their affiliates
+may purchase public shares or public warrants in privately negotiated transactions or in the open market either prior to or following
+the completion of our initial business combination. There is no limit on the number of shares our initial stockholders, directors, officers
+or their affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. However, they have
+no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such
+transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material
+nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. We do not
+currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange
+Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at
+the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Any such purchases
+will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting
+requirements. None of the funds held in the trust account will be used to purchase shares or public warrants in such transactions prior
+to completion of our initial business combination. See "Proposed Business — Permitted purchases of our securities"
+for a description of how our sponsor, initial stockholders, directors, officers or any of their affiliates will select which stockholders
+to purchase securities from in any private transaction.
+
+ 
+
+ 68
+
+ 
+
+ 
+
+ 
+
+The
+purpose of any such purchases of shares could be to vote such shares in favor of the initial business combination and thereby increase
+the likelihood of obtaining stockholder approval of the initial business combination or to satisfy a closing condition in an agreement
+with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination,
+where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce
+the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection
+with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination
+that may not otherwise have been possible. In addition, if such purchases are made, the public "float" of our shares of Class
+A common stock or warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult
+to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange.
+
+ 
+
+In
+no event will we redeem our public shares unless our net tangible assets are at least $5,000,001 either immediately prior to or upon
+consummation of our initial business combination and after payment of underwriters fees and commissions (so that we are not subject
+to the SEC s "penny stock" rules) and the agreement for our initial business combination may require as a closing condition
+that we have a minimum net worth or a certain amount of cash. If too many public stockholders exercise their redemption rights so that
+we cannot satisfy the net tangible asset requirement or any net worth or cash requirements, we would not proceed with the redemption
+of our public shares or the initial business combination, and instead may search for an alternate business combination.
+
+ 
+
+A public stockholder will be entitled
+to receive funds from the trust account only upon the earliest to occur of: (i) our completion of an initial business combination, (ii)
+the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate
+of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business
+combination or certain amendments to our amended and restated certificate of incorporation prior thereto or to redeem 100% of our public
+shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18
+months from the closing of this offering if extended as described elsewhere in this prospectus) or (B) with respect to any other
+provision relating to stockholders rights or pre-initial business combination activity, and (iii) the redemption of our public
+shares if we are unable to complete an initial business combination within 12 months from the closing of this offering (or up to 18
+months from the closing of this offering if extended as described elsewhere in this prospectus), subject to applicable law and as
+further described herein and any limitations (including but not limited to cash requirements) created by the terms of the proposed initial
+business combination. In no other circumstances will a public stockholder have any right or interest of any kind to or in the trust account.
+
+ 
+
+Our
+sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption
+rights with respect to any founder shares and placement shares and any public shares held by them in connection with the completion of
+our initial business combination. In addition, our initial stockholders have agreed to waive their rights to liquidating distributions
+from the trust account with respect to any founder shares and placement shares held by them if we fail to complete our initial business
+combination within the prescribed time frame. However, if our sponsor or any of our officers, directors or affiliates acquires public
+shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public
+shares if we fail to complete our initial business combination within the prescribed time frame.
+
+ 
+
+ 69
+
+ 
+
+ 
+
+ 
+
+DIVIDEND
+POLICY
+
+ 
+
+We
+have not paid any cash dividends on our common stock to date and do not intend to pay cash dividends prior to the completion of our initial
+business combination. The payment of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements
+and general financial condition subsequent to completion of our initial business combination and will be within the discretion of our
+board of directors at that time. If we increase or decrease the size of the offering we will effect a stock dividend or a share contribution
+back to capital or other appropriate mechanism, as applicable, with respect to our Class B common stock immediately prior to the consummation
+of the offering in such amount as to maintain the ownership of our initial stockholders at 22.60% of the issued and outstanding
+shares of our common stock (excluding the placement units and securities underlying the foregoing and assuming the initial stockholders
+do not purchase units in this offering) upon the consummation of this offering. Further, if we incur any indebtedness in connection with
+our initial business combination, our ability to declare dividends may be limited by restrictive covenants we may agree to in connection
+therewith.
+
+ 
+
+ 70
+
+ 
+
+ 
+
+ 
+
+DILUTION
+
+ 
+
+The difference between the public
+offering price per share of Class A common stock, assuming no value is attributed to the warrants included in the units we are offering
+pursuant to this prospectus or the placement units, and the pro forma net tangible book value per share of our Class A common stock after
+this offering constitutes the dilution to investors in this offering. Such calculation does not reflect any dilution associated with
+the sale and exercise of warrants, including the placement warrants, which would cause the actual dilution to the public stockholders
+to be higher, particularly where a cashless exercise is utilized. Net tangible book value per share is determined by dividing our net
+tangible book value, which is our total tangible assets less total liabilities (including the value of Class A common stock which may
+be redeemed for cash), by the number of outstanding shares of our Class A common stock.
+
+ 
+
+At September 30, 2021, our net
+tangible book deficit was $99,148, or approximately $(0.05) per share of common stock. For purposes of the dilution calculation, in order
+to present the maximum estimated dilution as a result of this offering, we have assumed the number of shares included in the units offered
+hereby will be deemed to be 7,500,000 shares of Class A common stock, and the price per share in this offering will be deemed to be $10.00
+After giving effect to the sale of 7,500,000 shares of Class A common stock included in the units we are offering by this prospectus
+(or 8,625,000 shares of Class A common stock if the underwriters over-allotment option is exercised in full), the deduction of
+underwriting commissions and estimated expenses of this offering, our pro forma net tangible book value at September 30, 2021 would have
+been $(1,479,278), or approximately $(0.66) per share (or $(0.72) per share if the underwriters over-allotment
+option is exercised in full), representing an immediate decrease in net tangible book value (as decreased by the value of the approximately
+7,500,000 shares of Class A common stock that may be redeemed for cash, or 8,625,000 shares of Class A common stock if the underwriters 
+over-allotment option is exercised in full) of $(0.61) per share (or $(0.67) per share if the underwriters over-allotment
+option is exercised in full) to our initial stockholders as of the date of this prospectus and an immediate dilution of $10.66
+per share or 106.6% to our public stockholders (or $10.72 per share or 107.2% if the underwriters over-allotment
+option is exercised in full).
+
+ 
+
+The
+following table illustrates the dilution to the public stockholders on a per-share basis, assuming no value is attributed to the warrants
+included in the units or the placement warrants:
+
+ 
+
+ 
+ 
+ 
+ No
+ exercise of
+
+ over-allotment
+
+ option
+ 
+ 
+ Exercise
+ of
+
+ over-allotment
+
+ option in full
+ 
+
+ 
+ Public
+ offering price
+ 
+ 
+ 
+ 
+ 
+ $
+ 10.00
+ 
+ 
+ 
+ 
+ 
+ 
+ $
+ 10.00
+ 
+
+ 
+ Net
+ tangible book value before this offering
+ 
+ $
+ (0.05
+ )
+ 
+ 
+ 
+ 
+ 
+ $
+ (0.05
+ )
+ 
+ 
+ 
+ 
+
+ 
+ Increase
+ attributable to public stockholders and sale of the placement units
+ 
+ 
+ (0.61
+ ) 
+ 
+ 
+ 
+ 
+ 
+ 
+ (0.67
+ ) 
+ 
+ 
+ 
+ 
+
+ 
+ Pro
+ forma net tangible book value after this offering
+ 
+ 
+ 
+ 
+ 
+ 
+ (0.66
+ )
+ 
+ 
+ 
+ 
+ 
+ 
+ (0.72
+ )
+
+ 
+ Dilution
+ to public stockholders
+ 
+ 
+ 
+ 
+ 
+ $
+ 10.66
+ 
+ 
+ 
+ 
+ 
+ 
+ $
+ 10.72
+ 
+
+ 
+ Percentage
+ of dilution to public stockholders
+ 
+ 
+ 
+ 
+ 
+ 
+ 106.6
+ %
+ 
+ 
+ 
+ 
+ 
+ 
+ 107.2
+ %
+
+ 
+
+ 
+
+For purposes of presentation,
+our pro forma net tangible book value after this offering is $76,125,000 (or $87,543,750 if the underwriters exercise their
+over-allotment option in full) less than it otherwise would have been because if we effect our initial business combination, the conversion
+rights of the public stockholders (but not our insiders) may result in the conversion or tender of up to 7,500,000 (or 8,625,000
+if the underwriters exercise their over-allotment option in full) shares sold in this offering.
+
+ 
+
+ 71
+
+ 
+
+ 
+
+ 
+
+The
+following table sets forth information with respect to our initial stockholders, who hold our Class B common stock, holders
+of the placement shares and the public stockholders:
+
+ 
+
+ 
+ 
+ 
+ Shares
+ Purchased
+ 
+ 
+ Total
+ Consideration
+ 
+ 
+ Average
+ Price
+ 
+
+ 
+ 
+ 
+ Number
+ 
+ 
+ Percentage
+ 
+ 
+ Amount
+ 
+ 
+ Percentage
+ 
+ 
+ Per
+ Share
+ 
+
+ 
+ Initial
+ Stockholders(1)
+ 
+ 
+ 1,875,000
+ 
+ 
+ 
+ 19.21
+ %
+ 
+ $
+ 25,000
+ 
+ 
+ 
+ 0.03
+ %
+ 
+ $
+ 0.01
+ 
+
+ 
+ Representative
+ Shares
+ 
+ 
+ 37,500
+ 
+ 
+ 
+ 0.38
+ %
+ 
+ $
+ -
+ 
+ 
+ 
+ 0.00
+ %
+ 
+ $
+ -
+ 
+
+ 
+ Holders
+ of placement shares
+ 
+ 
+ 346,394
+ 
+ 
+ 
+ 3.55
+ %
+ 
+ 
+ 3,463,935
+ 
+ 
+ 
+ 4.42
+ %
+ 
+ 
+ 10.00
+ 
+
+ 
+ Public
+ Stockholders
+ 
+ 
+ 7,500,000
+ 
+ 
+ 
+ 76.86
+ %
+ 
+ 
+ 75,000,000
+ 
+ 
+ 
+ 95.55
+ %
+ 
+ $
+ 10.00
+ 
+
+ 
+ 
+ 
+ 
+ 9,758,894
+ 
+ 
+ 
+ 100.00
+ %
+ 
+ 
+ 78,488,935
+ 
+ 
+ 
+ 100.00
+ %
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ (1)
+ Assumes no exercise
+ of the underwriters over-allotment option and the corresponding forfeiture of an aggregate of 281,250 shares of Class B common
+ stock held by our sponsor.in the event the underwriter does not exercise its over-allotment option.
+
+ 
+
+The
+pro forma net tangible book value per share after the offering is calculated as follows:
+
+ 
+
+ 
+ 
+ 
+ Without
+
+ Over-allotment
+ 
+ 
+ With
+
+ Over-allotment
+ 
+
+ 
+ Numerator:
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Net
+ tangible book deficit before this offering
+ 
+ $
+ (99,148
+ )
+ 
+ $
+ (99,148
+ )
+
+ 
+ Net
+ proceeds from this offering and sale of the placement units, net of expenses(1)
+ 
+ 
+ 77,075,000
+ 
+ 
+ 
+ 88,493,750
+ 
+
+ 
+ Plus:
+ Offering costs paid in advance, excluded from tangible book value
+ 
+ 
+ 107,370
+ 
+ 
+ 
+ 107,370
+ 
+
+ 
+ Less:
+ Deferred underwriting commissions
+ 
+ 
+ (2,437,500
+ )
+ 
+ 
+ (2,803,125
+ )
+
+ 
+ Less:
+ Proceeds held in trust subject to redemption (2)
+ 
+ 
+ (76,125,000
+ )
+ 
+ 
+ (87,543,750
+ )
+
+ 
+ 
+ 
+ $
+ (1,479,278
+ ) 
+ 
+ $
+ (1,844,903
+ ) 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Without
+
+Over-allotment
+ 
+ 
+ With
+
+Over-allotment
+ 
+
+ 
+ Denominator:
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Shares of Class B common stock outstanding prior to this offering
+ 
+ 
+ 2,156,250
+ 
+ 
+ 
+ 2,156,250
+ 
+
+ 
+ Shares of Class B common stock forfeited if over-allotment is not exercised
+ 
+ 
+ (281,250
+ )
+ 
+ 
+ -
+ 
+
+ 
+ Shares of Class A common stock included in the units offered
+ 
+ 
+ 7,500,000
+ 
+ 
+ 
+ 8,625,000
+ 
+
+ 
+ Shares of common stock included in the placement units issued
+ 
+ 
+ 346,394
+ 
+ 
+ 
+ 377,331
+ 
+
+ 
+ Representative shares
+ 
+ 
+ 37,500
+ 
+ 
+ 
+ 43,125
+ 
+
+ 
+ Less: Shares subject to redemption
+ 
+ 
+ (7,500,000
+ )
+ 
+ 
+ (8,625,000
+ )
+
+ 
+ 
+ 
+ 
+ 2,258,894
+ 
+ 
+ 
+ 2,576,706
+ 
+
+ 
+ 
+
+ (1)
+ Expenses
+ applied against gross proceeds include offering expenses of $451,435 and underwriting commissions of $937,500 (or $1,078,125
+ if the over-allotment option is exercised in full) (excluding deferred underwriting fees). See "Use of Proceeds."
+
+ 
+ 
+
+ (2)
+ If
+ we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial
+ business combination pursuant to the tender offer rules, our sponsor, initial stockholders, directors, executive officers, advisors
+ or their affiliates may purchase public shares or public warrants in privately negotiated transactions or in the open market either
+ prior to or following the completion of our initial business combination. In the event of any such purchases of our shares prior
+ to the completion of our initial business combination, the number of shares of Class A common stock subject to redemption will be
+ reduced by the amount of any such purchases, increasing the pro forma net tangible book value per share. See "Proposed Business
+ — Effecting Our Initial Business Combination — Permitted Purchases of Our Securities."
+
+ 
+
+ 72
+
+ 
+
+ 
+
+ 
+
+CAPITALIZATION
+
+ 
+
+The
+following table sets forth our capitalization at September 30, 2021 and as adjusted to give effect to the filing of our amended
+and restated certificate of incorporation, the sale of our units in this offering and the sale of the placement units and the application
+of the estimated net proceeds derived from the sale of such securities, assuming no exercise by the underwriters of their over-allotment
+option:
+
+ 
+
+ 
+ 
+ 
+ September
+ 30, 2021
+ 
+
+ 
+ 
+ 
+ Actual
+ 
+ 
+ As
+ Adjusted
+ 
+
+ 
+ Notes
+ payable to related party(1)
+ 
+ $
+ 108,978
+ 
+ 
+ $
+ -
+ 
+
+ 
+ Deferred
+ underwriting commissions
+ 
+ 
+ -
+ 
+ 
+ 
+ 2,437,500
+ 
+
+ 
+ Class
+ A common stock, $0.0001 par value, 125,000,000 shares authorized; -0- and 7,500,000 shares are subject to possible redemption,
+ respectively(2)
+ 
+ 
+ -
+ 
+ 
+ 
+ 76,125,000
+ 
+
+ 
+ Preferred
+ stock, $0.0001 par value, 1,250,000 shares authorized; none issued and outstanding, actual and as adjusted
+ 
+ 
+ -
+ 
+ 
+ 
+ -
+ 
+
+ 
+ Class
+ A common stock, $0.0001 par value, 125,000,000 shares authorized; -0- and 383,894 shares issued and outstanding, actual and
+ as adjusted, net of shares subject to redemption
+ 
+ 
+ -
+ 
+ 
+ 
+ 38
+ 
+
+ 
+ Class
+ B common stock, $0.0001 par value, 12,500,000 shares authorized, 2,156,250 and 1,875,000 shares issued and outstanding,
+ actual and as adjusted, respectively(3)
+ 
+ 
+ 216
+ 
+ 
+ 
+ 188
+ 
+
+ 
+ Additional
+ paid-in capital
+ 
+ 
+ 24,784
+ 
+ 
+ 
+ -
+ 
+
+ 
+ Accumulated
+ deficit
+ 
+ 
+ (16,778
+ )
+ 
+ 
+ (1,479,504
+ )
+
+ 
+ Total
+ stockholders equity
+ 
+ $
+ 8,222
+ 
+ 
+ $
+ (1,479,278
+ )
+
+ 
+ Total
+ capitalization
+ 
+ $
+ 117,200
+ 
+ 
+ $
+ 77,083,222
+ 
+
+ 
+ 
+
+ (1)
+ Our
+ sponsor has agreed to loan us up to $300,000 to be used for a portion of the expenses of this offering. The "as adjusted"
+ information gives effect to the repayment of any loans made under this note out of the proceeds from this offering and the sale of
+ the placement units. As of September 30, 2021, we had borrowed $108,978 (of up to $300,000 available to us) under the
+ promissory note with our sponsor.
+
+ 
+ 
+
+ (2)
+ All of the 7,500,000 shares of Class A common stock sold as part of the
+units in the offering contain a redemption feature which allows for the redemption of such public shares in connection with our liquidation,
+if there is a stockholder vote or tender offer in connection with our initial business combination and in connection with certain amendments
+to our amended and restated certificate of incorporation. In accordance with SEC and its guidance on redeemable equity instruments, which
+has been codified in ASC 480-10-S99, redemption provisions not solely within the control of a company require common stock subject to
+redemption to be classified outside of permanent equity. Given that the 7,500,000 shares of Class A common stock sold as part of the units
+in the offering will be issued with other freestanding instruments (i.e., public warrants), the initial carrying value of Class A ordinary
+shares classified as temporary equity will be the allocated proceeds determined in accordance with ASC 470-20. Our Class A common stock
+is subject to ASC 480-10-S99. If it is probable that the equity instrument will become redeemable, we have the option to either (i) accrete
+changes in the redemption value over the period from the date of issuance (or from the date that it becomes probable that the instrument
+will become redeemable, if later) to the earliest redemption date of the instrument or (ii) recognize changes in the redemption value
+immediately as they occur and adjust the carrying amount of the instrument to equal the redemption value at the end of each reporting
+period. We have elected to recognize the changes immediately. The accretion or remeasurement will be treated as a deemed dividend (i.e.,
+a reduction to retained earnings, or in absence of retained earnings, additional paid-in capital). While redemptions cannot cause our
+net tangible assets to fall below $5,000,001, all shares of Class A common stock sold in this offering are redeemable and classified as
+such on the balance sheet until such date that a redemption event takes place.
+
+ 
+ 
+
+ (3)
+ Actual
+ share amount is prior to any forfeiture of founder shares by our sponsor and as adjusted amount assumes no exercise of the underwriters 
+ over-allotment option.
+
+ 
+
+ 73
+
+ 
+
+ 
+
+ 
+
+MANAGEMENT S
+DISCUSSION AND ANALYSIS OF
+
+FINANCIAL CONDITION AND RESULTS OF OPERATIONS
+
+ 
+
+Overview
+
+ 
+
+We
+are a newly-organized blank check company incorporated as a Delaware corporation in February 2021 and formed for the purpose of
+effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one
+or more businesses. While our efforts to identify a target business may span many industries and regions worldwide, we intend to focus
+our search for prospects within the healthcare and technology industries, specifically within the biotechnology and pharmaceutical sectors,
+in the Americas. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated
+any substantive discussions, directly or indirectly, with any business combination target. We intend to effectuate our initial business
+combination using cash from the proceeds of this offering and the sale of the placement units, the proceeds of the sale of our shares
+in connection with our initial business combination (including pursuant to backstop agreements we may enter into following the consummation
+of this offering or otherwise), shares issued to the owners of the target, debt issued to bank or other lenders or the owners of the
+target, or a combination of the foregoing.
+
+ 
+
+The
+issuance of additional shares in connection with an initial business combination to the owners of the target or other investors:
+
+ 
+
+ 
+ 
+ may
+ significantly dilute the equity interest of investors in this offering, which dilution would increase if the anti-dilution provisions
+ in the Class B common stock resulted in the issuance of Class A shares on a greater than one-to-one basis upon conversion of the
+ Class B common stock;
+
+ 
+ 
+ 
+
+ 
+ 
+ may
+ subordinate the rights of holders of our common stock if preferred stock is issued with rights senior to those afforded our common
+ stock;
+
+ 
+ 
+ 
+
+ 
+ 
+ could
+ cause a change in control if a substantial number of shares of our common stock is issued, which may affect, among other things,
+ our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers
+ and directors;
+
+ 
+ 
+ 
+
+ 
+ 
+ may
+ have the effect of delaying or preventing a change of control of us by diluting the stock ownership or voting rights of a person
+ seeking to obtain control of us; and
+
+ 
+ 
+ 
+
+ 
+ 
+ may
+ adversely affect prevailing market prices for our Class A common stock and/or warrants.
+
+ 
+
+Similarly,
+if we issue debt securities or otherwise incur significant debt to bank or other lenders or the owners of a target, it could result in:
+
+ 
+
+ 
+ 
+ default
+ and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt
+ obligations;
+
+ 
+ 
+ 
+
+ 
+ 
+ acceleration
+ of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants
+ that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ immediate payment of all principal and accrued interest, if any, if the debt is payable on demand;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ inability to obtain necessary additional financing if the debt contains covenants restricting our ability to obtain such financing
+ while the debt is outstanding;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ inability to pay dividends on our common stock;
+
+ 
+
+ 74
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ using
+ a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends
+ on our common stock if declared, our ability to pay expenses, make capital expenditures and acquisitions, and fund other general
+ corporate purposes;
+
+ 
+ 
+ 
+
+ 
+ 
+ limitations
+ on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate;
+
+ 
+
+ 
+ 
+ increased
+ vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation;
+
+ 
+ 
+ 
+
+ 
+ 
+ limitations
+ on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, and execution
+ of our strategy; and
+
+ 
+ 
+ 
+
+ 
+ 
+ other
+ purposes and other disadvantages compared to our competitors who have less debt.
+
+ 
+
+As indicated in the accompanying
+financial statements, at September 30, 2021, we had cash of $9,830 and deferred offering costs of $107,370. Further,
+we expect to continue to incur significant costs in the pursuit of our initial business combination plans. We cannot assure you that
+our plans to raise capital or to complete our initial business combination will be successful. 
+
+Results
+of Operations and Known Trends or Future Events
+
+ 
+
+We
+have neither engaged in any operations nor generated any revenues to date. Our only activities since inception have been organizational
+activities and those necessary to prepare for this offering. Following this offering, we will not generate any operating revenues until
+after completion of our initial business combination. We will generate non-operating income in the form of interest income on cash and
+cash equivalents after this offering. There has been no significant change in our financial or trading position and no material adverse
+change has occurred since the date of our audited financial statements. After this offering, we expect to incur increased expenses as
+a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as expenses as we conduct
+due diligence on prospective business combination candidates. We expect our expenses to increase substantially after the closing of this
+offering.
+
+ 
+
+Liquidity
+and Capital Resources
+
+ 
+
+As indicated in the accompanying
+financial statements, at September 30, 2021, we had cash of $9,830 and a working capital deficit of $99,148. Further,
+we have incurred and expect to continue to incur significant costs in pursuit of our financing and acquisition plans. We cannot assure
+you that our plans to raise capital or to consummate an initial business combination will be successful. These factors, among others,
+raise substantial doubt about our ability to continue as a going concern. Our
+ liquidity needs have been satisfied prior to the completion of this offering through a capital
+ contribution from our sponsor of $25,000 for the founder shares and up to $300,000 in loans
+ available from our sponsor under an unsecured promissory note. We estimate that the net proceeds
+ from (i) the sale of the units in this offering, after deducting offering expenses of approximately
+ $451,435, underwriting commissions of $937,500 ($1,078,125 if the underwriters over-allotment
+ option is exercised in full) (excluding deferred underwriting commissions of $2,437,500 (or
+ $2,803,125 if the underwriters over-allotment option is exercised in full), and (ii)
+ the sale of the placement units for a purchase price of $3,463,935 (or $3,773,310
+ if the underwriters over-allotment option is exercised in full), will be $77,075,000
+ (or $88,493,750 if the underwriters over-allotment option is exercised
+ in full). Of this amount, $76,125,000 (or $87,543,750 if the underwriters over-allotment
+ option is exercised in full) will be held in the trust account, which includes $2,437,500
+ (or $2,803,125 if the underwriters over-allotment option is exercised in full) of
+ deferred underwriting commissions. The proceeds held in the trust account will be invested
+ only in U.S. government treasury obligations with a maturity of 185 days or less or in money
+ market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act
+ which invest only in direct U.S. government treasury obligations. The remaining approximately
+ $950,000 will not be held in the trust account. In the event that our offering expenses
+ exceed our estimate of $451,435, we may fund such excess with funds not to be held in the
+ trust account. In such case, the amount of funds we intend to be held outside the trust account
+ would decrease by a corresponding amount. Conversely, in the event that the offering expenses
+ are less than our estimate of $451,435, the amount of funds we intend to be held outside
+ the trust account would increase by a corresponding amount.
+
+ 
+
+ 75
+
+ 
+
+ 
+
+ 
+
+We
+intend to use substantially all of the funds held in the trust account, including any amounts representing interest earned on the trust
+account (less deferred underwriting commissions), to complete our initial business combination. We may withdraw interest to pay taxes.
+We estimate our annual franchise tax obligations, based on the number of shares of our common stock authorized and outstanding after
+the completion of this offering, to be $200,000, which is the maximum amount of annual franchise taxes payable by us as a Delaware corporation
+per annum, which we may pay from funds from this offering held outside of the trust account or from interest earned on the funds held
+in our trust account and released to us for this purpose. Our annual income tax obligations will depend on the amount of interest and
+other income earned on the amounts held in the trust account. We expect the interest earned on the amount in the trust account will be
+sufficient to pay our income taxes. To the extent that our capital stock or debt is used, in whole or in part, as consideration to complete
+our initial business combination, the remaining proceeds held in the trust account will be used as working capital to finance the operations
+of the target business or businesses, make other acquisitions and pursue our growth strategies.
+
+ 
+
+Prior
+to the completion of our initial business combination, we will have available to us the approximately $950,000 of proceeds held
+outside the trust account. We will use these funds to identify and evaluate target businesses, perform business due diligence on prospective
+target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives
+or owners, review corporate documents and material agreements of prospective target businesses, and structure, negotiate and complete
+an initial business combination.
+
+ 
+
+Following completion of our
+initial public offering, in order to fund working capital deficiencies or finance transaction costs in connection with an intended
+initial business combination, our sponsor or an affiliate of our sponsor or certain of our officers and directors may, but are not obligated
+to, loan us funds on a non-interest bearing basis as may be required. If we complete our initial business combination, we would repay
+such loaned amounts. This post-initial public offering commitment for up to $1,500,000 of loans is separate from the pre initial public
+offering of the $300,000 loan amounts. In the event that our initial business combination does not close, we may use a portion of
+the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust account would be used
+for such repayment Up to $1,500,000 of such loans may be convertible into units, at a price of $10.00 per unit at the option of the lender,
+upon consummation of our initial business combination. The units would be identical to the placement units. Other than as described above,
+the terms of such loans by our officers and directors, if any, have not been determined and no written agreements exist with respect
+to such loans. We do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not believe
+third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our trust
+account.
+
+ 
+
+We
+expect our primary liquidity requirements during that period to include approximately $300,000 for legal, accounting, due diligence,
+travel and other expenses associated with structuring, negotiating and documenting successful business combinations; $100,000 for legal
+and accounting fees related to regulatory reporting requirements; $150,000 for office space, utilities and secretarial and administrative
+support; approximately $350,000 for Director and Officer liability insurance premiums; and approximately $50,000 for working
+capital that will be used for miscellaneous expenses and reserves.
+
+ 
+
+These
+amounts are estimates and may differ materially from our actual expenses. In addition, we could use a portion of the funds not being
+placed in trust to pay commitment fees for financing, fees to consultants to assist us with our search for a target business or as a
+down payment or to fund a "no-shop" provision (a provision designed to keep target businesses from "shopping"
+around for transactions with other companies or investors on terms more favorable to such target businesses) with respect to a particular
+proposed initial business combination, although we do not have any current intention to do so. If we entered into an agreement where
+we paid for the right to receive exclusivity from a target business, the amount that would be used as a down payment or to fund a "no-shop"
+provision would be determined based on the terms of the specific business combination and the amount of our available funds at the time.
+Our forfeiture of such funds (whether as a result of our breach or otherwise) could result in our not having sufficient funds to continue
+searching for, or conducting due diligence with respect to, prospective target businesses.
+
+ 
+
+ 76
+
+ 
+
+ 
+
+ 
+
+We
+do not believe we will need to raise additional funds following this offering in order to meet the expenditures required for operating
+our business. However, if our estimates of the costs of identifying a target business, undertaking in-depth due diligence and negotiating
+an initial business combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate
+our business prior to our initial business combination. Moreover, we may need to obtain additional financing either to complete our initial
+business combination or because we become obligated to redeem a significant number of our public shares upon completion of our initial
+business combination, in which case we may issue additional securities or incur debt in connection with such business combination. In
+addition, we intend to target businesses larger than we could acquire with the net proceeds of this offering and the sale of the placement
+units, and may as a result be required to seek additional financing to complete such proposed initial business combination. Subject to
+compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our initial business
+combination. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we
+will be forced to cease operations and liquidate the trust account. In addition, following our initial business combination, if cash
+on hand is insufficient, we may need to obtain additional financing in order to meet our obligations.
+
+ 
+
+Controls
+and Procedures
+
+ 
+
+We
+are not currently required to maintain an effective system of internal controls as defined by Section 404 of the Sarbanes-Oxley Act.
+We will be required to comply with the internal control requirements of the Sarbanes-Oxley Act for the fiscal year ending December 31,
+2022. Only in the event that we are deemed to be a large accelerated filer or an accelerated filer would we be required to comply with
+the independent registered public accounting firm attestation requirement. Further, for as long as we remain an emerging growth company
+as defined in the JOBS Act, we intend to take advantage of certain exemptions from various reporting requirements that are applicable
+to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the
+independent registered public accounting firm attestation requirement.
+
+ 
+
+Prior
+to the closing of this offering, we have not completed an assessment, nor has our independent registered public accounting firm tested
+our systems, of internal controls. We expect to assess the internal controls of our target business or businesses prior to the completion
+of our initial business combination and, if necessary, to implement and test additional controls as we may determine are necessary in
+order to state that we maintain an effective system of internal controls. A target business may not be in compliance with the provisions
+of the Sarbanes-Oxley Act regarding the adequacy of internal controls. Many small and mid-sized target businesses we may consider for
+our initial business combination may have internal controls that need improvement in areas such as:
+
+ 
+
+ 
+ 
+ staffing
+ for financial, accounting and external reporting areas, including segregation of duties;
+
+ 
+ 
+ 
+
+ 
+ 
+ reconciliation
+ of accounts;
+
+ 
+ 
+ 
+
+ 
+ 
+ proper
+ recording of expenses and liabilities in the period to which they relate;
+
+ 
+ 
+ 
+
+ 
+ 
+ evidence
+ of internal review and approval of accounting transactions;
+
+ 
+ 
+ 
+
+ 
+ 
+ documentation
+ of processes, assumptions and conclusions underlying significant estimates; and
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ documentation
+ of accounting policies and procedures.
+
+ 
+
+Because
+it will take time, management involvement and perhaps outside resources to determine what internal control improvements are necessary
+for us to meet regulatory requirements and market expectations for our operation of a target business, we may incur significant expense
+in meeting our public reporting responsibilities, particularly in the areas of designing, enhancing, or remediating internal and disclosure
+controls. Doing so effectively may also take longer than we expect, thus increasing our exposure to financial fraud or erroneous financing
+reporting.
+
+ 
+
+Once
+our management s report on internal controls is complete, we will retain our independent registered public accounting firm to audit
+and render an opinion on such report when required by Section 404 of the Sarbanes-Oxley Act. The independent registered public accounting
+firm may identify additional issues concerning a target business s internal controls while performing their audit of internal control
+over financial reporting.
+
+ 
+
+ 77
+
+ 
+
+ 
+
+ 
+
+Quantitative
+and Qualitative Disclosures about Market Risk
+
+ 
+
+The
+net proceeds of this offering and the sale of the placement units held in the trust account will be invested in U.S. government treasury
+bills with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company
+Act which invest only in direct U.S. government treasury obligations. Due to the short-term nature of these investments, we believe there
+will be no associated material exposure to interest rate risk.
+
+ 
+
+Related
+Party Transactions
+
+ 
+
+On
+March 15, 2021, our sponsor purchased 2,875,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.009 per
+share. On November 19, 2021, we cancelled 718,750 founder shares due to the downsize of the proposed public offering, resulting in 2,156,250
+founder shares, of which 281,250 shares are subject to forfeiture if the over-allotment option was not exercised in full. On March 15,
+2021, our sponsor transferred 20,000 founder shares each to our Chief Executive Officer and Chief Operating Officer, as well as 2,500
+founder shares to each of our Chief Scientific Officer and Scientific Advisor. On October 27, 2021, our sponsor transferred
+17,500 founder shares to our Chief Scientific Officer, 10,000 founder shares to our Chief Executive Officer, 17,500 founder shares
+to our Chief Scientific Officer, 30,000 founder shares to each of our two independent directors, 25,000 founder shares to each
+of our two independent directors, 15,000 founder shares to our strategic and scientific advisor and 5,500 founder shares to our Scientific
+Advisor, and 15,000 founder shares to our Strategic and Scientific Advisor. The number of founder shares issued was determined
+based on the expectation that such founder shares would represent 20% of the outstanding shares upon completion of this offering (excluding
+the placement units and securities underlying the foregoing). The per share purchase price of the founder shares was determined by dividing
+the amount of cash contributed to the company by the aggregate number of founder shares issued. In addition, our sponsor has separately
+agreed to transfer to our Chief Operating Officer an aggregate of 30,000 of its founder shares at the time of our business combination. 
+
+ 
+
+If we increase or decrease the
+size of the offering we will effect a stock dividend or a share contribution back to capital or other appropriate mechanism, as applicable,
+with respect to our Class B common stock immediately prior to the consummation of the offering in such amount as to maintain the ownership
+of our initial stockholders at 20% of the issued and outstanding shares of our common stock (excluding the placement units and securities
+underlying the foregoing and assuming the initial stockholders do not purchase units in this offering) upon the consummation of this offering.
+Up to 281,250 founder shares held by our sponsor are subject to forfeiture by our sponsor depending on the extent to which the underwriters 
+over-allotment option is exercised. The founder shares (including the Class A common stock issuable upon exercise thereof) may not, subject
+to certain limited exceptions, be transferred, assigned or sold by the holder.
+
+ 
+
+Commencing
+on the date of this prospectus, we have agreed to pay Genesis Unicorn Capital, LLC, our sponsor, a total of $10,000
+per month for office space, utilities and secretarial and administrative support. Upon completion of our initial business combination
+or our liquidation, we will cease paying these monthly fees.
+
+ 
+
+Our
+sponsor, officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in
+connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business
+combinations. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors
+or our or their affiliates and will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling
+on the reimbursement of out-of-pocket expenses incurred by such persons in connection with activities on our behalf.
+
+ 
+
+Prior to the consummation of
+this offering, our sponsor has agreed to loan us up to $300,000 to be used for a portion of the expenses of this offering. These
+loans are non-interest bearing, unsecured and are due at the earlier of March 31, 2022 or the closing of this offering. The
+loan will be repaid upon the closing of this offering out of the $451,435 of offering proceeds that has been allocated to the
+payment of offering expenses (other than underwriting commissions).
+
+ 
+
+In
+addition, in order to finance transaction costs in connection with an intended initial business combination, our sponsor or an
+affiliate of our sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required,
+such additional loans being separate from the $300,000 loan from our sponsor. If we complete our initial business combination,
+we would repay such loaned amounts. In the event that our initial business combination does not close, we may use a portion of
+the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust account would be
+used for such repayment. Up to $1,500,000 of such loans may be convertible into units, at a price of $10.00 per unit at the option
+of the lender, upon consummation of our initial business combination. The units would be identical to the placement units. The
+terms of such loans by our officers and directors, if any, have not been determined and no written agreements exist with respect
+to such loans. We do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not
+believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds
+in our trust account.
+
+ 
+
+ 78
+
+ 
+
+ 
+
+ 
+
+Our sponsor has agreed to purchase
+an aggregate of 346,394 placement units at a price of $10.00 per unit for an aggregate purchase price of $3,463,935. If the over-allotment
+option is exercised in full, the amount of placement units sold will be 377,331 for an aggregate purchase price of $3,773,310. Each placement
+unit consists of one share of Class A common stock and one warrant to purchase one share of Class A common stock. Each warrant is exercisable
+to purchase one whole share of Class A common stock at $11.50 per share. There will be no redemption rights or liquidating distributions
+from the trust account with respect to the founder shares, the placement shares or the placement warrants, which will expire worthless
+if we do not complete an initial business combination within 12 months from the closing of this offering (or up to 18 months
+from the closing of this offering if extended as described elsewhere in this prospectus). The placement units are identical to the units
+sold in this offering except that (a) the placement units and their component securities will not be transferable, assignable or saleable
+until 30 days after the consummation of our initial business combination except to permitted transferees, (b) the placement warrants,
+so long as they are held by our sponsor or its permitted transferees, (i) will not be redeemable by us, (ii) may be exercised by the
+holders on a cashless basis, and (iii) will be entitled to registration rights.
+
+ 
+
+Our initial stockholders have
+agreed to waive their redemption rights with respect to their founder shares and placement shares (i) in connection with the consummation
+of a business combination, (ii) in connection with a stockholder vote to amend our amended and restated certificate of incorporation
+to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain
+amendments to our amended and restated certificate of incorporation prior thereto or to redeem 100% of our public shares if we do not
+complete an initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing
+of this offering if extended as described elsewhere in this prospectus) and (iii) if we fail to complete an initial business combination
+within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if extended as described
+elsewhere in this prospectus) or if we liquidate prior to the expiration of the applicable period. However, our initial stockholders
+will be entitled to redemption rights with respect to any public shares held by them if we fail to execute a definitive agreement to
+complete an initial business combination, consummate a business combination or liquidate within the applicable periods described above.
+
+ 
+
+Pursuant
+to a registration rights agreement we will enter into with our initial stockholders on or prior to the closing of this offering, we may
+be required to register certain securities for sale under the Securities Act. These holders, and holders of units issued upon conversion
+of working capital loans, if any, are entitled under the registration rights agreement to make up to three demands that we register certain
+of our securities held by them for sale under the Securities Act and to have the securities covered thereby registered for resale pursuant
+to Rule 415 under the Securities Act. In addition, these holders have the right to include their securities in other registration statements
+filed by us. We will bear the costs and expenses of filing any such registration statements. See the section of this prospectus entitled
+"Certain Relationships and Related Party Transactions."
+
+ 
+
+Off-Balance
+Sheet Arrangements; Commitments and Contractual Obligations; Quarterly Results
+
+ 
+
+As
+of September 30, 2021, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K and
+did not have any commitments or contractual obligations. No unaudited quarterly operating data is included in this prospectus, as we
+have conducted no operations to date.
+
+ 
+
+JOBS
+Act
+
+ 
+
+On
+April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains provisions that, among other things, relax certain reporting requirements
+for qualifying public companies. We will qualify as an "emerging growth company" and under the JOBS Act will be allowed to
+comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are
+electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting
+standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result, our financial
+statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective
+dates.
+
+ 
+
+Additionally,
+we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject
+to certain conditions set forth in the JOBS Act, if, as an "emerging growth company", we choose to rely on such exemptions
+we may not be required to, among other things, (i) provide an independent registered public accounting firm s attestation report
+on our system of internal controls over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure
+that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii)
+comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the report of
+independent registered public accounting firm providing additional information about the audit and the financial statements (auditor
+discussion and analysis), and (iv) disclose certain executive compensation related items such as the correlation between executive compensation
+and performance and comparisons of the Chief Executive Officers compensation to median employee compensation. These exemptions
+will apply for a period of five years following the completion of this offering or until we are no longer an "emerging growth company,"
+whichever is earlier.
+
+ 
+
+ 79
+
+ 
+
+ 
+
+ 
+
+PROPOSED
+BUSINESS
+
+ 
+
+Overview
+
+ 
+
+We
+are a newly organized blank check company incorporated in February 2021 as a Delaware
+corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar
+business combination with one or more businesses, which we refer to as our initial business combination. We have not selected any specific
+business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly,
+with any business combination target with respect to an initial business combination with us.
+
+ 
+
+While we may pursue an initial
+business combination opportunity in any business, industry, sector or geographical location, we intend to capitalize on the ability of
+our management team to identify promising opportunities at the intersection of the healthcare and technology industries, specifically
+within the biotechnology and pharmaceutical sectors. Our objective is to focus on middle market and emerging growth businesses operating
+with a total enterprise value from $200 million to $1 billion, which companies may be located throughout the world except for an
+entity or business with its principal or a majority of its business operations (either directly or through any subsidiaries) in the People s
+Republic of China (including Hong Kong and Macau).
+
+ 
+
+Our
+Sponsor and Management Team
+
+ 
+
+Our sponsor has made an initial
+investment of $25,000 in exchange for 2,156,250 shares of our Class B common stock (up to 281,250 shares of which are subject to forfeiture
+by our sponsor depending on the extent to which the underwriters over-allotment option is exercised), which will automatically
+convert into shares of Class A common stock at the time of the consummation of our initial business combination, on a one-for-one basis,
+subject to adjustment as described herein. Additionally, our sponsor has agreed to purchase an aggregate of 346,394 placement
+units (or 377,331 placement units if the over-allotment option is exercised in full) at a price of $10.00 per unit, for an aggregate
+purchase price of $3,463,935 ($3,773,310 if the over-allotment option is exercised in full). 
+
+Our sponsor was formed for the
+purpose of creating the company and the gathering the proposed management team in order to undertake and complete our initial
+public offering and source, analyze and acquire a target business.
+
+ 
+
+Members of our management team
+and board of directors have served as executive officers, directors and senior management of international corporations and businesses
+in varied industries.
+
+ 
+
+Dr. Adeoye (Oye) Olukotun, our
+Chief Executive Officer, has over 35 years in the pharmaceutical industry. He is a Mayo Clinic trained cardiologist who currently serves
+as the Chief Executive Officer of CR Strategies, LLC a position he has held since April 2000. He previously served as the Chief
+Executive Officer and President of Epigen Pharmaceuticals, Inc. from June 2014 to March 2017, and Vice Chairman of CardioVax,
+Inc., from January 2013 to April 2016. Dr. Olukotun served as the Chief Medical Officer of VIA Pharmaceuticals Inc. from 2004
+to 2008. He spent the first 20 years of his career in roles of increasing responsibility in clinical development at Pfizer, Bristol-Myers
+Squibb, and Mallinckrodt. He has over 35 years of experience in the pharmaceutical industry and has been instrumental in the approval
+and success of numerous cardiology and metabolic medicines, including the first daily beta blocker and the first approved ACE inhibitor,
+among others. Dr. Olukotun currently serves on the board of directors for Tonix Pharmaceuticals Holding Corp., (NASDAQ: TNXP) and Arrowhead
+Pharmaceuticals, Inc. (NASDAQ: ARWR). Dr. Olukotun received his Medical Doctor degree from the Albert Einstein College of Medicine in
+New York in 1973, undertook his specialty in cardiovascular medicine at the Mayo Clinic and Mayo Graduate School of Medicine from 1973
+to 1978 and received a master in public health degree from Harvard University School of Public Health in 1983. Further, Dr. Olukotun
+received his bachelor of arts from the University of North Carolina at Chapel Hill in 1969.
+
+ 
+
+Samuel
+Lui, our President, Chief Financial Officer and director, has over 23 years of experience in capital markets, investment banking, private
+equity, accounting and auditing. Since July 2016, he has been the founder and managing director of LV Capital Limited, a private investment
+company focused on later stage/pre-IPO investments and specializes in helping investee companies to list on major exchanges such as NASDAQ
+and The Stock Exchange of Hong Kong Limited ("HKEX"). Since December 2011, he has served as a board member of the private
+equity funds at Rockstead Capital Private Limited, a registered fund management company under the Monetary Authority of Singapore. Since
+November 2016, he has also been a non-executive director of EFT Solutions Holdings Limited (HKEX:8062). From December 2013 to May 2015,
+Mr. Lui was the chief financial officer of ELL Environmental Holdings Limited (HKEX: 1395). From May 2007 to May 2009, Mr. Lui was a
+director within the financial sponsors group, investment banking division of Merrill Lynch in Hong Kong and Singapore. Prior to that,
+Mr. Lui worked as an assistant director of the financial sponsors group at ABN AMRO Bank N.V., Hong Kong branch, from August 2005 to
+April 2007. From July 2004 to August 2005, Mr. Lui was a vice president at the project finance and advisory department of Soci t 
+G n rale Asia Limited. Prior to that, Mr. Lui served as a manager of project and export finance at The Hongkong and Shanghai
+Banking Corporation Limited from May 2003 to June 2004. From August 1998 to April 2003, Mr. Lui worked in the audit and corporate finance
+departments of Arthur Andersen and Ernest & Young in Singapore. Mr. Lui obtained a bachelor degree in accountancy from Nanyang Technological
+University in Singapore in July 1998. Mr. Lui has been a member of the Institute of Singapore Chartered Accountants since October 2002.
+
+ 
+
+Dr. Niel Starksen, our Chief
+Scientific Officer, is an entrepreneur, physician and scientist. He is a pioneer of percutaneous therapeutic technologies for structural
+heart disease and congestive heart failure. Dr. Starksen is an inventor on 18 issued patents and over 20 patents pending. Dr. Starksen
+previously served as Chief Executive Officer of Guided Delivery Systems (now known as Ancora Heart) from September 2002 to July 2015
+and, since September 2018, is a director and cofounder of Vivalink Medical, a provider of connected healthcare solutions for remote patient
+monitoring.He has been an advisor to Xcures (a platform for virtual clinical trials) since September 2018, and an advisor to Well Advised
+(a medical fintech platform) since September 2019. He is a Director of the Board of Governors, Johns Hopkins Wilmer Eye Institute. Dr.
+Starksen received his Medical Doctor degree from The John Hopkins University School of Medicine in June 1982, completed an internal medicine
+residency program at Harvard Medical School in April 1985 and completed his specialty in cardiovascular medicine at the School of Medicine,
+University of California, San Francisco in July 1990. Further, Dr. Starksen received his bachelor of science degree summa cum laude from
+the University of California, Irvine in June 1978.
+
+ 
+
+ 80
+
+ 
+
+ 
+
+ 
+
+Juan
+Fernandez Pascual, our Chief Operating Officer, served as the General Manager of Chassis Brakes International Spain SLU, a division of
+Hitachi Automotive Systems, based in San Felices de Buelna, Cantabria, Spain, from April 2019 to February 2021. Mr. Fernandez has served
+as a special advisor to Benessere Capital Acquisition Corporation since November 2020. Benessere Capital Acquisition is a similar special
+purpose acquisition company (SPAC) entity which completed its initial public offering in January 2021. Benessere Capital Acquisition
+has focused its search on technology-focused middle market and emerging growth companies in North, Central and South America. Mr. Fernandez served as the President of Gira Cluster of Automotive Industries
+of Cantabria from May 2019 to March 2021 and was based in Spain. From September 2018 to April 2019, Mr. Fernandez served as the Smart
+Factory Platform Leader of Linxens based in Levallois, le-de-France, France. From January 2017 to April 2019, Mr. Fernandez served
+as the Site Director of Linxens. From September 2015 to December 2016, Mr. Fernandez served as the Senior Area Sales Manager Southern
+Europe for Quintus Technologies, based in Vasteras, Sweden. From September 2014 to September 2015, Mr. Fernandez served as the Site Director
+of Hutchinson based in Ch teaudun, France. From April 2013 to August 2014, Mr. Fernandez served as the Production Area Manager of
+Gestamp based in Le Theil, Basse-Normandie, France. From November 2005 to March 2013, Mr. Fernandez served as Process Engineer Manager
+at ArcelorMittal Aviles, Spain. From September 2003 to October 2005, Mr. Fernandez served as Resident Engineer of ArcelorMittal based
+Electrolux premises in Conegliano, Veneto, Italy. In 2018, Mr. Fernandez received his Executive MBA degree at ESCP Europe. In 1999, Mr.
+Fernandez received his DEA (Master in Sciences) at Ecole Polytechnique.
+
+ 
+
+Grainne
+Coen, who will be one of our independent directors and Co-Chairman of the Board, is a board member of Commonwealth Credit Partners
+BDC I, Inc., a business development company, and became Chair of the Audit Committee since June 2021. In May 2018, she founded and
+has remained a partner of Elevation Investment Partners, LLC, a diversified investment group operating in multiple industries both
+as strategic consultants and early-stage investors. Since January 2015, Ms. Coen has also served as Co-Founder and Chairperson of
+AREA4, LLC, an experiential marketing agency. From August 2001 to December 2015, she was a principal and portfolio manager at
+Columbia Partners, LLC Investment Management, where she co-managed over $1 billion in assets held in the fund s U.S. Small Cap
+Equity Fund. From September 1998 to March 2001, she was a General Partner at Kensington Partners, LLC, and from May 1996 to August
+1998, she was employed at G&O Partners, LP. Since October 2019, Ms. Coen also has served as the Chair of the audit committee of
+Kubient, Inc. (NASDAQ: KBNT), a digital marketing platform, and from March 2019 to December 2020, as Chair of the board of directors
+of ERIE ARMADA, Inc., a non-profit focused on the development of underserved communities in conjunction with New York City s
+Parks and Trails Department. Ms. Coen holds a Bachelor of Science from London Guildhall University.
+
+ 
+
+Ernest
+Fong, who will be one of our independent directors and Co-Chairman of the Board, has, since October 2021, been the Asia Pacific CEO
+of Optimas Capital, an Asian-based Hedge Fund with offices in Hong Kong, Singapore and Taiwan. Mr. Fong joined Credit Suisse in
+March 1998 and after spending more than 21 years in its Singapore, Taiwan and Hong Kong offices, he retired from Credit Suisse in
+December 2019. His last position in Credit Suisse was as the Head of Markets Research in Asia Pacific and he was responsible for a
+team of almost 300 across 14 offices and 12 markets. Prior to Credit Suisse, Mr. Fong was an equity research analyst at Credit
+Lyonnais Securities Asia from June 1995 to February 1998. Since June 2020, Mr. Fong is also a non-executive director of Vincom
+Retail, listed in Vietnam, which is part of the Vincom group, the largest privately-owned company in Vietnam. Ernest graduated from
+National University of Singapore with a Bachelor of Arts degree, majoring in Economics and Statistics.
+
+ 
+
+Chung
+Fan Cheng, who will be one of our independent directors, has over 17 years of experience in capital markets, corporate strategy, private
+equity, family office and entrepreneurship. Since Feb 2019, Mr. Cheng has served as the Chief Investment Officer of BlueTop Group, a
+Hong Kong based family office with core focus in education, human capital and technology. Mr. Cheng also serves as a non-executive director
+of Tsui Wah Restaurant Group (HKEX:1314) since November 2016, and a director of Esperanza Limited, founded by the former financial secretary
+of Hong Kong, since July 2021. Mr. Cheng s prior work includes management roles with Sail Global Capital from September 2017 to
+December 2018, Hao Tian International Securities from September 2016 to August 2017, and KGI Asia from April 2013 to September 2016.
+Mr. Cheng is an Engineer by training and holds a M.Sc. Engineering Enterprise Management, HKUST, Hong Kong and B.Sc. Engineering (1st
+Honors), Queen s University, Canada.
+
+ 
+
+Teck-Yong
+Heng, who will be one of our independent directors, will bring in more than 20 years of private equity and M&A experience to the
+Company. Mr. Heng is a partner and senior management in 58.com s Investment Fund focusing on venture capital and private equity
+investments in the TMT and Consumer sectors since August 2021. Prior to joining in 58.com, Mr. Heng has operated C-Squared Partners,
+a China focused consumer sector private equity fund since May 2018. From August 2016 to May 2018, Mr. Heng was a managing director in
+Qianhai Ark Asset Management, a fund with approximately $4.5 billion under management. Prior to Qianhai Ark, Mr. Heng worked at Pavilion
+Capital (an affiliated entity of Temasek Holdings) from September 2012 to July 2016, Temasek Holdings from October 2004 to September
+2012, Cambridge Associates from July 2003 to October 2004, Singapore Power International from June 2001 to July 2003, and Arthur Andersen
+from July 1998 to May 2001. Mr. Heng has also served as independent director for LiXiang Education Holding Co. Ltd. (NASDAQ: LXEH) since
+October 2020, and an independent director for WiMi Hologram Cloud Inc. (NASDAQ: WIMI) since May 2021. Mr. Heng is also a director
+of another SPAC entity, Broad Capital Acquisition Corp. which completed its initial public offering in January 2022. Mr. Heng graduated
+from Nanyang Technological University with a bachelor s degree in Accountancy (with Honors) and is a graduate of Harvard Business
+School s General Management Program. He is a Chartered Financial Analyst (CFA), Chartered Accountant (CA), Chartered International
+M&A Charterholder, and a member of Singapore Institute of Directors.
+
+ 
+
+In addition, in April
+2021, our sponsor had engaged ARC Group Limited to assist and advise us in various matters related to our initial public offering,
+for which services ARC Group Limited was to be paid a fee of $10,000 a month. In August, 2021, in connection with the anticipated
+change of ownership of our sponsor (which ownership change was completed in October, 2021) we terminated the agreement with ARC
+Group Limited and the parties agreed that ARC Group Limited s role would be limited to assisting us in preparation of
+financial information and financial statements for use in the registration statement of which this prospectus forms a part and its
+role will terminate upon completion of this offering. ARC Group Limited is not receiving any compensation for such services and
+neither we nor our sponsor are obligated to provide compensation to ARC Group Limited upon completion of this offering or in the
+future. After completion of this offering we do not intend on engaging ARC Group limited for future services. ARC Group Limited and
+its affiliates are an investment bank and advisory firm which operates outside of the United States and provides financial advisory,
+investment banking, consulting and similar services to its clients.
+
+ 
+
+Our
+independent director nominees have experience in public company governance, executive leadership, operational oversight, private equity
+investment management and capital markets experience. Our directors also have experience with acquisitions, divestitures and corporate
+strategy and implementation, which we believe will significantly benefit us as we evaluate potential acquisition or merger candidates
+as well as following the completion of our initial business combination.
+
+ 
+
+We
+believe that our management team s extensive experience and deep expertise in our target industries position us well to take advantage
+of the growing set of acquisition opportunities focused on biotech and pharmaceutical and that our vast network, ranging from owners
+and management teams of private and public companies, private equity funds, investment bankers, attorneys, to accountants and business
+brokers will allow us to generate an attractive transaction for our stockholders.
+
+ 
+
+The
+past performance of the members of our management team or their affiliates is not a guarantee that we will be able to identify a suitable
+candidate for our initial business combination or of success with respect to any business combination we may consummate. You should not
+rely on the historical record of the performance of our management team or any of its affiliates performance as indicative of
+our future performance.
+
+ 
+
+ 81
+
+ 
+
+ 
+
+ 
+
+Business
+Strategy
+
+ 
+
+While we may pursue an initial
+business combination target in any industry or geographic location, we intend to focus our search on middle market and emerging growth
+biotech and pharmaceutical-focused companies, businesses or assets that benefit from continuously evolving technology and the resulting
+shift in consumer and business purchase behavior. Most of these companies will ultimately need to consolidate to achieve the scale necessary
+to attain high revenue growth and attractive profitability. We believe that acquiring a leading high-growth technology company or assets
+in the healthcare, biotechnology or pharmaceutical industry will provide a platform to fund consolidation and fuel growth for our company. We have not identified any particular geographical area or country in which
+we may seek a business combination. However, we shall not consider or undertake a business combination
+with an entity or business with its principal or a majority of its business operations (either directly or through any subsidiaries)
+in the People s Republic of China (including Hong Kong and Macau). 
+
+We
+believe that there is a large pool of quality initial business combination targets looking for exit opportunities with an increasing
+number of private equity (or PE) and venture capital (or VC) activities in the Americas, which provides us opportunities given what we
+believe are the limited exit options for mid-market companies in the region. Also, we believe that the technology and tech enabled industries
+in the Americas represent a particularly attractive deal sourcing environment that will allow us to leverage our team s skill sets
+and experience to identify an initial business combination which can potentially serve as a strong platform for future add-on acquisitions.
+Our investment thesis is supported by what we believe are the following trends in our target sectors:
+
+ 
+
+-
+Growth in research and development: Scientific breakthroughs and innovations in oncology, gene therapy, synthetic
+biology, personalized medicine, precision medicine, rare diseases, and other sub-sectors of the biopharmaceutical and life
+sciences industries, are creating new opportunities for investors in the sector. According to EvaluatePharma, worldwide
+pharmaceutical R&D spend is expected to reach over $230 billion by 2026, an approximately 50% increase over ten
+years.
+
+ 
+
+-
+Robust private market deal activity: Strong levels of venture capital activity in the biotechnology sector support our pursuit of
+an initial business combination. According to a recent Analyst note from Pitchbook, biotechnology and pharmaceutical start-ups raised
+over $23 billion in venture capital financing across 865 deals in 2020 as of November 18, 2020 breaking the deal value record set in
+2018. Since 2015, biotechnology and pharmaceutical start-ups raised over $80 billion across over 4,000 deals. Many of these companies
+continue to grow and may view the public markets as an attractive alternative to support their growth.
+
+ 
+
+- Regulatory environment:
+The FDA continues to approve new drugs at a healthy pace. There were 228 novel drug approvals in the five-year period from
+2016 to 2020. This represents a 44% increase over the number of novel drugs approved over the period from 2010 to 2014. The constructive
+regulatory environment is encouraging continued investment in the biotechnology and pharmaceutical sectors.
+
+ 
+
+Competitive
+Advantages
+
+ 
+
+We
+intend to capitalize on the following competitive advantages in our pursuit of a target company:
+
+ 
+
+ 
+ 
+ Leadership
+ of an Experienced Management Team. Our experienced management team has over 35 years of combined work experience as investment
+ professionals in a variety of industries, such as pharmaceutical and financial institutions. These years of experience have allowed
+ us to gain not only extensive and deep expertise in our fields, but also vast networks of some of the most influential thought leaders
+ and top performing companies in our target industries and region. This positions Genesis Unicorn Capital Corp as a unique and strategic
+ player, and as an attractive alternative for the many companies that
+ seek to tap the equity capital markets, ensuring that we find the most attractive opportunities that maximize value to our stockholders.
+
+ 
+ 
+ 
+
+ 
+ 
+ Established
+ Deal Sourcing Network. We believe the strong track record of our management team will enable us to get access to quality
+ deal pipeline. In addition, we believe that our management team and advisors, can generate acquisition opportunities and possibly
+ seek complementary follow-on business arrangements through their international network of contacts in, among others, private and
+ public companies, private equity and venture capital funds, investment banks, accounting and law firms.
+
+ 
+ 
+ 
+
+ 
+ 
+ Status
+ as a Publicly Listed Acquisition Company. We believe our structure will make us an attractive business combination partner
+ to prospective target businesses. As a publicly listed company, we will offer a target business an alternative to the traditional
+ initial public offering process. We believe that some target businesses will favor this alternative, which we believe is less expensive,
+ while offering greater certainty of execution, than the traditional initial public offering process. During an initial public offering,
+ there are typically underwriting fees and marketing expenses, which would cost more than a business combination with us. Furthermore,
+ once a proposed business combination is approved by our stockholders (if applicable) and the transaction is consummated, the target
+ business will have effectively become public, whereas an initial public offering is always subject to the underwriter s ability
+ to complete the offering, as well as general market conditions that could prevent the offering from occurring. Once public, we believe
+ our target business would have greater access to capital and additional means of creating management incentives that are better aligned
+ with stockholders interests than it would as a private company. It can offer further benefits by augmenting a target company s
+ profile among potential new customers and vendors and aid in attracting talented management staffs.
+
+ 
+
+ 82
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Targeting
+ of Fastest Growing Industries. The main industries we are targeting are in the biotechnology and pharmaceutical
+ sectors. This is not just a function of our expertise in these fields, but it is also because these sectors are currently
+ anticipated to be some of the fastest growing industries in the global economy, with the expectation that the biotechnology
+ sector will expand at a CAGR of approximately 15.83% from 2021 to 2028, while the pharmaceutical sector will expand at a CAGR
+ of approximately 10.23% for the corresponding period.
+
+ 
+
+Industry
+Opportunity
+
+ 
+
+While
+we may acquire a business in any industry, our focus will be in the biotechnology and pharmaceutical industries. We believe that
+our target industries are attractive for a number of reasons.
+
+ 
+
+We
+believe that the biotechnology sector represents a tremendous opportunity for growth, with many promising pre-commercial companies seeking
+funding and guidance from knowledgeable investment firms. There are multiple trends in the sector that contribute to this growth potential,
+and we believe they will enable us to identify and acquire an attractive target. These trends include the following:
+
+ 
+
+-
+Large addressable market with strong growth: Total U.S. national health expenditure was $74.1 billion in 1970. By 2000,
+health expenditures reached about $1.4 trillion, and in 2019 the amount spent on health more than doubled to $3.8 trillion.
+CMS projected that by 2028, health care spending would reach $6.19 trillion, and would account for 19.7% of GDP, up from
+17.7% in 2018.
+
+ 
+
+-
+Technological progress driving innovation. Biotechnology innovation has accelerated in recent years due to new technology, including
+advances in computing, artificial intelligence, genetics and cellular engineering. Biotechnology companies have used these tools in many
+ways, particularly for breakthrough discoveries in the areas of targeted oncology, gene therapy, gene editing and cell therapy. We believe
+the pace of this advancement can persist and even grow, which could result in many new therapies that address unmet needs.
+
+ 
+
+-
+Transformational opportunities. Technology can be used as a disruptor within the healthcare sector to improve the quality
+of care provided to patients or the accessibility of care. Furthermore, there is significant scope for transformational
+innovation within the healthcare and technology industries separately.
+
+ 
+
+-
+Strong macroeconomic trends. The global population is aging and according to the United Nations the population aged 60
+years or over is expected to more than double between 2017 and 2050. This represents a significant global healthcare
+challenge but also an opportunity for innovative companies focused on extending healthy lifespans.
+
+ 
+
+- Strength despite COVID-19.
+The Nasdaq Biotech Index (NBI) has outperformed the general market for the last ten years (from 2012 to December 15,2021),
+with a 337.5% return for the NBI versus a 274.5% return for the S&P 500. We
+believe this demand is fueled in part by a renewed focus on the biotechnology sector as a result of the COVID-19 pandemic, which has
+served as a reminder of the important role biotechnology plays in solving global health problems. We believe this paradigm can serve
+as an additional tailwind for the growth of promising, innovative biopharmaceutical companies.
+
+ 
+
+We
+believe becoming publicly traded presents several major benefits for private biotechnology companies, including greater access to capital,
+more liquid securities and increased customer awareness. Furthermore, we believe an acquisition by a special purpose acquisition company
+with a respected management team that is well-known to biotechnology investors and management teams can be a very attractive mechanism
+for accessing the public markets due to the increased deal certainty, transparency and efficiency it can provide.
+
+ 
+
+ 83
+
+ 
+
+ 
+
+ 
+
+Acquisition
+Criteria and Process
+
+ 
+
+Our acquisition strategy
+is to complete a business combination that will create value for our stockholders over time. We expect to conduct intensive
+diligence of a potential target, including but not limited to deal structure, financial forecasting and scientific viability using
+our management team s expertise combined with the opinions of key industry leaders in their network of relationships. While
+we may enter into a business combination with a company that does not meet all of these criteria, we intend to focus on companies
+that we believe have the following characteristics:
+
+ 
+
+-Therapeutics-focused
+business (i.e. biopharmaceuticals) with potential to significantly advance care for the disease of focus.
+
+ 
+
+-Preclinical
+through commercial stage assets, with investments focused on programs that are both pre-proof-of-concept ("PoC") and
+post-PoC.
+
+ 
+
+-A
+company with minimal additional equity required to achieve significant defined clinical, regulatory or commercial milestones beyond
+the capital provided by the target, us and any potential concurrent PIPE.
+
+ 
+
+Consistent
+with our strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective
+target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, although we may decide to enter
+into our initial business combination with a target business that does not meet these criteria and guidelines.
+
+ 
+
+ 
+ 
+ Revenue
+ and Earnings Growth Potential. We will seek to acquire one or more businesses that have the potential for significant revenue
+ and earnings growth through a combination of both existing and new product development, increased production capacity, expense reduction
+ and synergistic follow-on acquisitions resulting in increased operating leverage.
+
+ 
+ 
+ 
+
+ 
+ 
+ Potential
+ for Strong Free Cash Flow Generation. We will seek to acquire one or more businesses that have the potential to generate
+ strong, stable and increasing free cash flow. We intend to focus on one or more businesses that have the potential for predictable,
+ recurring revenue streams and definable low working capital and capital expenditure requirements. We may also seek to prudently leverage
+ this cash flow in order to enhance stockholder value.
+
+ 
+ 
+ 
+
+ 
+ 
+ Strong
+ and Experienced Management. We will to seek companies that have strong, experienced management teams in place, or are a platform
+ to assemble an effective management team with a track record of driving growth and profitability. We will spend significant time
+ assessing a company s leadership and human fabric, and maximizing its efficiency over time.
+
+ 
+ 
+ 
+
+ 
+ 
+ Benefit
+ from Being a Public Company. We intend to acquire one or more businesses that will benefit from being publicly traded and
+ can effectively utilize the broader access to capital and the public profile that are associated with being a publicly traded company.
+
+ 
+ 
+ 
+
+ 
+ 
+ Defensible
+ Market Position. We intend to acquire one or more businesses that have a defensible market position, with demonstrated advantages
+ when compared to their competitors and which create barriers to entry against new competitors.
+
+ 
+
+These
+criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be
+based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that from time to time
+our management may deem relevant.
+
+ 
+
+ 84
+
+ 
+
+ 
+
+ 
+
+Initial
+Business Combination
+
+ 
+
+Nasdaq
+rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value
+of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on
+the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of
+directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not
+able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent
+investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such
+criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair
+market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of
+a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. Additionally,
+pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors.
+
+ 
+
+We
+anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares
+will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial
+business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target
+business in order to meet certain objectives of the prior owners of the target business, the target management team or stockholders or
+for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of
+the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be
+required to register as an investment company under the Investment Company Act of 1940, as amended (the "Investment Company Act").
+Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the
+business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the
+target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number
+of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would
+acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders
+immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent
+to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned
+or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued
+for purposes of the 80% fair market value test. If the business combination involves more than one target business, the 80% fair market
+value test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as our
+initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable.
+
+ 
+
+To
+the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages
+of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management will endeavor
+to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant
+risk factors.
+
+ 
+
+In
+evaluating a prospective target business, we expect to conduct a thorough due diligence review which will encompass, among other things,
+meetings with incumbent management and employees, document reviews, inspection of facilities, as well as a review of financial, operational,
+legal and other information which will be made available to us.
+
+ 
+
+The
+time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs
+associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification
+and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in
+our incurring losses and will reduce the funds we can use to complete another business combination.
+
+ 
+
+ 85
+
+ 
+
+ 
+
+ 
+
+Sourcing
+of Potential Initial Business Combination Targets
+
+ 
+
+Certain
+members of our management team have spent significant portions of their careers working with businesses in the technology industry and
+have developed a wide network of professional services contacts and business relationships in that industry. The members of our board
+of directors also have significant executive management and public company experience with technology related companies and bring additional
+relationships that further broaden our industry network.
+
+ 
+
+This
+network has provided our management team with a flow of referrals that have resulted in numerous transactions in the past.
+We believe that the network of contacts and relationships of our management team will provide us with an important source
+of acquisition opportunities. In addition, we anticipate that target business candidates will be brought to our attention from
+various unaffiliated sources, including investment market participants, private equity groups, investment banks, consultants,
+accounting firms and large business enterprises.
+
+ 
+
+Members
+of our management team and our independent directors will directly or indirectly own founder shares and/or placement units following
+this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate
+business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of
+interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors
+was included by a target business as a condition to any agreement with respect to our initial business combination.
+
+ 
+
+In
+addition, each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual
+obligations to other entities pursuant to which such officer or director is or will be required to present a business combination
+opportunity to such entity. The personal and financial interests of our directors and officers
+may influence their motivation in timely identifying and selecting a target business and completing a business combination. The
+different timelines of competing business combinations could cause our directors and officers to prioritize a different business
+combination over finding a suitable acquisition target for our business combination.
+We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially
+affect our ability to complete our initial business combination.
+
+ 
+
+In
+addition, our sponsor and our officers and directors may sponsor or form other special purpose acquisition companies similar to ours
+or may pursue other business or investment ventures during the period in which we are seeking an initial business combination. Any such
+companies, businesses or investments may present additional conflicts of interest in pursuing an initial business combination. However,
+we do not believe that any such potential conflicts would materially affect our ability to complete our initial business combination.
+
+ 
+
+Other Considerations
+
+ 
+
+We are not prohibited
+from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the
+event we seek to complete our initial business combination with a company that is affiliated with our sponsor or any of our officers
+or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm
+or another independent entity that commonly renders valuation opinions that such initial business combination is fair to our company
+from a financial point of view. We are not required to obtain such an opinion in any other context.
+
+ 
+
+We currently do not
+have any specific business combination under consideration. Our officers and directors have neither individually selected nor
+considered a target business nor have they had any substantive discussions regarding possible target businesses among themselves
+or with our underwriter or other advisors. Our management team is regularly made aware of potential business opportunities, one
+or more of which we may desire to pursue for a business combination, but we have not (nor has anyone on our behalf) contacted
+any prospective target business or had any substantive discussions, formal or otherwise, with respect to a business combination
+transaction with our company. Additionally, we have not, nor has anyone on our behalf, taken any substantive measure, directly
+or indirectly, to identify or locate any suitable acquisition candidate for us, nor have we engaged or retained any agent or other
+representative to identify or locate any such acquisition candidate.
+
+ 
+
+In addition, certain
+of our officers and directors presently have, and any of them in the future are expected to have, additional, fiduciary and contractual
+duties to other entities. As a result, if any of our officers or directors becomes aware of a business combination opportunity
+which is suitable for an entity to which he, she or it has then-current fiduciary or contractual obligations, then, subject to
+their fiduciary duties under applicable law governing such other entity or entities, he or she will need to honor such fiduciary
+or contractual obligations to present such business combination opportunity to such entity, before we can pursue such opportunity.
+If these other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. However, we do not
+expect these duties to materially affect our ability to complete our initial business combination because we do not currently
+anticipate any meaningful overlap of investment objectives. Our amended and restated certificate of incorporation and bylaws provide
+that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any
+duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar
+business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity
+to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the
+one hand, and us, on the other.
+
+ Our
+ sponsor, officers and directors may sponsor, form or participate in other blank check companies
+ similar to ours during the period in which we are seeking an initial business combination.
+ Any such companies may present additional conflicts of interest in pursuing an acquisition
+ target, particularly in the event there is overlap among investment mandates. Our Chief Operating
+ Officer, Mr. Fernandez, is an adviser to another SPAC entity, Benessere Capital Acquisition
+ which completed its initial public offering in January 2021. Benessere Capital Acquisition
+ has focused its search on technology-focused middle market and emerging growth companies
+ in North, Central and South America, Europe and South-east Asia. Further, Ms. Grainne
+ Coen, a director nominee who will be a Co-Chair of our Board of Directors, is President
+ and Chief Financial Officer of Signal Hill Acquisition Corp., a SPAC entity which is contemplating
+ its initial public offering and another of our nominees to our Board, Mr. Teck-Yong Heng,
+ is a director of Broad Capital Acquisition Corp., a SPAC entity which completed
+ its initial public offering in January 2022. The primary focus for Broad
+ Capital Acquisition is general aviation and aerospace industry, and the unmanned aircraft
+ systems (UAS) and advanced air mobility (AAM) industries. In addition, our sponsor, officers
+ and directors are not required to commit any specified amount of time to our affairs, and,
+ accordingly, will have conflicts of interest in allocating management time among various
+ business activities, including identifying potential business combinations and monitoring
+ the related due diligence.
+
+ 
+
+Status
+as a Public Company
+
+ 
+
+We
+believe our structure will make us an attractive business combination partner to target businesses. As a public company, we offer a target
+business an alternative to the traditional initial public offering through a merger or other business combination with us. Following
+an initial business combination, we believe the target business would have greater access to capital and additional means of creating
+management incentives that are better aligned with stockholders interests than it would as a private company. A target business
+can further benefit by augmenting its profile among potential new customers and vendors and aid in attracting talented employees. In
+a business combination transaction with us, the owners of the target business may, for example, exchange their shares of stock in the
+target business for our shares of Class A common stock (or shares of a new holding company) or for a combination of our shares of Class
+A common stock and cash, allowing us to tailor the consideration to the specific needs of the sellers.
+
+ 
+
+Although
+there are various costs and obligations associated with being a public company, we believe target businesses will find this method a
+more expeditious and cost effective method to becoming a public company than the typical initial public offering. The typical initial
+public offering process takes a significantly longer period of time than the typical business combination transaction process, and there
+are significant expenses in the initial public offering process, including underwriting discounts and commissions, marketing and road
+show efforts that may not be present to the same extent in connection with an initial business combination with us.
+
+ 
+
+ 86
+
+ 
+
+ 
+
+ 
+
+Furthermore,
+once a proposed initial business combination is completed, the target business will have effectively become public, whereas an initial
+public offering is always subject to the underwriters ability to complete the offering, as well as general market conditions,
+which could delay or prevent the offering from occurring or could have negative valuation consequences. Following an initial business
+combination, we believe the target business would then have greater access to capital and an additional means of providing management
+incentives consistent with stockholders interests and the ability to use its shares as currency for acquisitions. Being a public
+company can offer further benefits by augmenting a company s profile among potential new customers and vendors and aid in attracting
+talented employees.
+
+ 
+
+While
+we believe that our structure and our management team s backgrounds will make us an attractive business partner, some potential
+target businesses may view our status as a blank check company, such as our lack of an operating history and our ability to seek stockholder
+approval of any proposed initial business combination, negatively.
+
+ 
+
+We
+are an "emerging growth company," as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act. As such,
+we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies
+that are not "emerging growth companies" including, but not limited to, not being required to comply with the independent
+registered public accounting firm attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding
+executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory
+vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find
+our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities
+may be more volatile.
+
+ 
+
+In
+addition, Section 107 of the JOBS Act also provides that an "emerging growth company" can take advantage of the extended
+transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other
+words, an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise
+apply to private companies. We intend to take advantage of the benefits of this extended transition period.
+
+ 
+
+We
+will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of
+the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed
+to be a large accelerated filer, which means the market value of our Class A common stock that is held by non-affiliates exceeds $700
+million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt
+securities during the prior three-year period.
+
+ 
+
+Additionally, we are a "smaller
+reporting company" as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain
+reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain
+a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates
+equals or exceeds $250 million as of the end of the prior June 30th and our annual
+revenues equaled or exceeded $100 million during such completed fiscal year, or (2) the market value of our common stock held
+by non-affiliates exceeds $700 million as of the prior June 30th.
+
+ 
+
+Financial
+Position
+
+ With
+funds available for an initial business combination initially in the amount of $73,687,500, after payment of $2,437,500
+deferred underwriting fee (or $84,740,625 after payment of $2,803,125 deferred underwriting fees if the underwriters 
+over-allotment option is exercised in full), in each case before fees and expenses associated with our initial business combination (other
+than deferred underwriting fees), we offer a target business a variety of options such as creating a liquidity event for its owners,
+providing capital for the potential growth and expansion of its operations or strengthening its balance sheet by reducing its debt or
+leverage ratio. Because we are able to complete our initial business combination using our cash, debt or equity securities, or a combination
+of the foregoing, we have the flexibility to use the most efficient combination that will allow us to tailor the consideration to be
+paid to the target business to fit its needs and desires. However, we have not taken any steps to secure third party financing and there
+can be no assurance it will be available to us.
+
+ 
+
+ 87
+
+ 
+
+ 
+
+ 
+
+Effecting
+Our Initial Business Combination
+
+ 
+
+We
+are not presently engaged in, and we will not engage in, any operations for an indefinite period of time following this offering. We
+intend to effectuate our initial business combination using cash from the proceeds of this offering and the sale of the placement units,
+the proceeds of the sale of our shares in connection with our initial business combination (pursuant to backstop agreements we may enter
+into following the consummation of this offering or otherwise), shares issued to the owners of the target, debt issued to bank or other
+lenders or the owners of the target, or a combination of the foregoing. We may seek to complete our initial business combination with
+a company or business that may be financially unstable or in its early stages of development or growth, which would subject us to the
+numerous risks inherent in such companies and businesses.
+
+ 
+
+If
+our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account
+are used for payment of the consideration in connection with our initial business combination or used for redemptions of our Class A
+common stock, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for
+maintenance or expansion of operations of the post-transaction company, the payment of principal or interest due on indebtedness incurred
+in completing our initial business combination, to fund the purchase of other companies or for working capital.
+
+ 
+
+We
+may seek to raise additional funds through a private offering of debt or equity securities in connection with the completion of our initial
+business combination, and we may effectuate our initial business combination using the proceeds of such offering rather than using the
+amounts held in the trust account. In addition, we intend to target businesses larger than we could acquire with the net proceeds of
+this offering and the sale of the placement units, and may as a result be required to seek additional financing to complete such proposed
+initial business combination. Subject to compliance with applicable securities laws, we would expect to complete such financing only
+simultaneously with the completion of our initial business combination. In the case of an initial business combination funded with assets
+other than the trust account assets, our proxy materials or tender offer documents disclosing the initial business combination would
+disclose the terms of the financing and, only if required by applicable law or stock exchange requirements, we would seek stockholder
+approval of such financing. There are no prohibitions on our ability to raise funds privately, or through loans in connection with our
+initial business combination. At this time, we are not a party to any arrangement or understanding with any third party with respect
+to raising any additional funds through the sale of securities or otherwise.
+
+ 
+
+We
+have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination
+target. From the period commencing with our formation through the date of this prospectus, there have been no communications or discussions
+between any of our officers, directors or our sponsor and any of their potential contacts or relationships regarding a potential initial
+business combination. Additionally, we have not engaged or retained any agent or other representative to identify or locate any suitable
+acquisition candidate, to conduct any research or take any measures, directly or indirectly, to locate or contact a target business.
+However, we may contact such targets subsequent to the closing of this offering if we become aware that such targets are interested in
+a potential initial business combination with us and such transaction would be attractive to our stockholders. Accordingly, there is
+no current basis for investors in this offering to evaluate the possible merits or risks of the target business with which we may ultimately
+complete our initial business combination. Although our management will assess the risks inherent in a particular target business with
+which we may combine, we cannot assure you that this assessment will result in our identifying all risks that a target business may encounter.
+Furthermore, some of those risks may be outside of our control, meaning that we can do nothing to control or reduce the chances that
+those risks will adversely impact a target business.
+
+ 
+
+ 88
+
+ 
+
+ 
+
+ 
+
+Sources
+of Target Businesses
+
+ 
+
+We
+anticipate that target business candidates will be brought to our attention from various unaffiliated sources, including investment
+bankers and investment professionals, as a result of being solicited by us by calls or mailings. These sources may also introduce us
+to target businesses in which they think we may be interested on an unsolicited basis, since many of these sources will have read
+this prospectus and know what types of businesses we are targeting. Our officers and directors, as well as our sponsor and their
+affiliates, may also bring to our attention target business candidates that they become aware of through their business contacts as
+a result of formal or informal inquiries or discussions they may have, as well as attending trade shows or conventions. In addition,
+we expect to receive a number of deal flow opportunities that would not otherwise necessarily be available to us as a result of the
+business relationships of our officers and directors and our sponsor and their affiliates. While we do not presently anticipate
+engaging the services of professional firms or other individuals that specialize in business acquisitions on any formal basis, we
+may engage these firms or other individuals in the future, in which event we may pay a finder s fee, consulting fee, advisory
+fee or other compensation to be determined in an arm s length negotiation based on the terms of the transaction. We will
+engage a finder only to the extent our management determines that the use of a finder may bring opportunities to us that may not
+otherwise be available to us or if finders approach us on an unsolicited basis with a potential transaction that our management
+determines is in our best interest to pursue. Payment of finder s fees is customarily tied to completion of a transaction, in
+which case any such fee will be paid out of the funds held in the trust account. In no event, however, will our sponsor or any of
+our existing officers or directors be paid any finder s fee, reimbursement, consulting fee, monies in respect of any payment
+of a loan or other compensation by the company prior to, or in connection with any services rendered for any services they render in
+order to effectuate, the completion of our initial business combination (regardless of the type of transaction that it is). None of
+our sponsor, executive officers or directors, or any of their respective affiliates, will be allowed to receive any compensation,
+finder s fees or consulting fees from a prospective business combination target in connection with a contemplated initial
+business combination except as set forth herein. We have agreed to pay Genesis Unicorn Capital, LLC, our sponsor, a
+total of $10,000 per month for office space, utilities and secretarial and administrative support and to reimburse our sponsor for
+any out-of-pocket expenses related to identifying, investigating and completing an initial business combination. Some of our
+officers and directors may enter into employment or consulting agreements with the post-transaction company following our initial
+business combination. The presence or absence of any such fees or arrangements will not be used as a criterion in our selection
+process of an initial business combination candidate.
+
+ 
+
+We
+are not prohibited from pursuing an initial business combination with an initial business combination target that is affiliated with
+our sponsor, officers or directors or making the initial business combination through a joint venture or other form of shared ownership
+with our sponsor, officers or directors. In the event we seek to complete our initial business combination with an initial business combination
+target that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, would obtain an opinion
+from an independent investment banking firm or another independent entity that commonly renders valuation opinions that such an initial
+business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other
+context.
+
+ 
+
+Selection
+of a Target Business and Structuring of our Initial Business Combination
+
+ 
+
+If we are unable to (i) complete
+any such business combination within 12 months from the closing of this offering unless such 12 months is extended for
+up to two (2) successive three-month periods at our option (up to 18 months in total from the closing of this offering) and provided
+further that our sponsor deposits into the escrow account the sum of $0.20 per share (or $1,500,000 in the aggregate for
+each three-month extension, or $1,725,000 in the aggregate for each three-month extension if the over-allotment option is exercised
+in full) we will (x) cease all operations except for the purpose of winding up, (y) as promptly as reasonably possible but not more than
+ten business days thereafter, redeem 100% of the public shares, at a per-share price, payable in cash, equal to the aggregate amount
+then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to
+us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares,
+which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further
+liquidating distributions, if any), subject to applicable law, and (z) as promptly as reasonably possible following such redemption,
+subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in the case of clauses
+(y) and (z) above to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.
+In the event we elect to extend the deadline, we intend to issue a press release announcing such intention at least three days prior
+to the applicable deadline. In addition, we intend to issue a press release the day after the applicable deadline announcing whether
+or not the funds have been timely deposited. Our public shareholders will not have the right to vote upon or redeem their shares in connection
+with any extensions from the initial 12 month period.
+
+ 
+
+Nasdaq
+rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value
+of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on
+the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. The fair market
+value of our initial business combination will be determined by our board of directors based upon one or more standards generally accepted
+by the financial community, such as discounted cash flow valuation, a valuation based on trading multiples of comparable public businesses
+or a valuation based on the financial metrics of mergers and acquisition transactions of comparable businesses. If our board of
+directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion
+from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the
+satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination
+of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the
+business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects.
+We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. Subject
+to this requirement, our management will virtually have unrestricted flexibility in identifying and selecting one or more prospective
+target businesses, although we will not be permitted to effectuate our initial business combination with another blank check company
+or a similar company with nominal operations.
+
+ 
+
+ 89
+
+ 
+
+ 
+
+ 
+
+In
+any case, we will only complete an initial business combination in which we own or acquire 50% or more of the outstanding voting securities
+of the target or otherwise acquire a controlling interest in the target sufficient for it not to be required to register as an investment
+company under the Investment Company Act. If we own or acquire less than 100% of the equity interests or assets of a target business
+or businesses, the portion of such business or businesses that are owned or acquired by the post-transaction company is what will be
+taken into account for purposes of Nasdaq s 80% fair market value test. There is no basis for investors in this offering to evaluate
+the possible merits or risks of any target business with which we may ultimately complete our initial business combination.
+
+ 
+
+To
+the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages
+of development or growth we may be affected by numerous risks inherent in such company or business. Although our management will endeavor
+to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant
+risk factors.
+
+ 
+
+In
+evaluating a prospective business target, we expect to conduct a thorough due diligence review, which may encompass, among other things,
+meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities,
+as well as a review of financial and other information that will be made available to us.
+
+ 
+
+The
+time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs
+associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification
+and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in
+our incurring losses and will reduce the funds we can use to complete another business combination.
+
+ 
+
+Lack
+of Business Diversification
+
+ 
+
+For
+an indefinite period of time after the completion of our initial business combination, the prospects for our success may depend entirely
+on the future performance of a single business. Unlike other entities that have the resources to complete business combinations with
+multiple entities in one or several industries, it is probable that we will not have the resources to diversify our operations and mitigate
+the risks of being in a single line of business. In addition, we intend to focus our search for an initial business combination in a
+single industry. By completing our initial business combination with only a single entity, our lack of diversification may:
+
+ 
+
+ 
+ 
+ subject
+ us to negative economic, competitive and regulatory developments, any or all of which may have a substantial adverse impact on the
+ particular industry in which we operate after our initial business combination, and
+
+ 
+
+ 
+ 
+ cause
+ us to depend on the marketing and sale of a single product or limited number of products or services.
+
+ 
+
+Limited
+Ability to Evaluate the Target s Management Team
+
+ 
+
+Although
+we intend to closely scrutinize the management of a prospective target business when evaluating the desirability of effecting our initial
+business combination with that business, our assessment of the target business management may not prove to be correct. In addition,
+the future management may not have the necessary skills, qualifications or abilities to manage a public company. Furthermore, the future
+role of members of our management team, if any, in the target business cannot presently be stated with any certainty. The determination
+as to whether any of the members of our management team will remain with the combined company will be made at the time of our initial
+business combination. While it is possible that one or more of our directors will remain associated in some capacity with us following
+our initial business combination, it is unlikely that any of them will devote their full efforts to our affairs subsequent to our initial
+business combination. Moreover, we cannot assure you that members of our management team will have significant experience or knowledge
+relating to the operations of the particular target business.
+
+ 
+
+ 90
+
+ 
+
+ 
+
+ 
+
+We
+cannot assure you that any of our key personnel will remain in senior management or advisory positions with the combined company. The
+determination as to whether any of our key personnel will remain with the combined company will be made at the time of our initial business
+combination.
+
+ 
+
+Following
+an initial business combination, we may seek to recruit additional managers to supplement the incumbent management of the target business.
+We cannot assure you that we will have the ability to recruit additional managers, or that additional managers will have the requisite
+skills, knowledge or experience necessary to enhance the incumbent management.
+
+ 
+
+Stockholders
+May Not Have the Ability to Approve Our Initial Business Combination
+
+ 
+
+We
+may conduct redemptions without a stockholder vote pursuant to the tender offer rules of the SEC. However, we will seek stockholder approval
+if it is required by applicable law or applicable stock exchange listing requirements, or we may decide to seek stockholder approval
+for business or other legal reasons. Presented in the table below is a graphic explanation of the types of initial business combinations
+we may consider and whether stockholder approval is currently required under Delaware law for each such transaction.
+
+ 
+
+ Type
+ of Transaction
+ 
+ Whether
+ 
+
+ Stockholder 
+
+ Approval is 
+
+ Required
+
+ Purchase
+ of assets
+ 
+ No
+
+ Purchase
+ of stock of target not involving a merger with the company
+ 
+ No
+
+ Merger
+ of target into a subsidiary of the company
+ 
+ No
+
+ Merger
+ of the company with a target
+ 
+ Yes
+
+ 
+
+Under
+Nasdaq s listing rules, stockholder approval would be required for our initial business combination if, for example:
+
+ 
+
+ 
+ 
+ we
+ issue shares of Class A common stock that will be equal to or in excess of 20% of the number of shares of our Class A common
+ stock then outstanding (other than in a public offering for cash);
+
+ 
+
+ 
+ 
+ any
+ of our directors, officers or substantial stockholders (as defined by Nasdaq rules) has a 5% or greater interest (or such persons
+ collectively have a 10% or greater interest), directly or indirectly, in the target business or assets to be acquired or otherwise
+ and the present or potential issuance of common stock could result in an increase in outstanding common stock or voting power of
+ 5% or more; or
+
+ 
+
+ 
+ 
+ the
+ issuance or potential issuance of common stock will result in our undergoing a change of control.
+
+ 
+
+The
+decision as to whether we will seek stockholder approval of a proposed business combination in those instances in which stockholder
+approval is not required by law or the Nasdaq rules will be made by us, solely in our discretion, and will be based on business
+and legal reasons, which include a variety of factors, including, but not limited to:
+
+ 
+
+ the
+ timing of the transaction, including in the event we determine stockholder approval would
+ require additional time and there is either not enough time to seek stockholder approval
+ or doing so would place the company at a disadvantage in the transaction or result in
+ other additional burdens on the company 
+
+ the
+ expected cost of holding a stockholder vote 
+
+ the
+ risk that the stockholders would fail to approve the proposed business combination 
+ 
+
+ other
+ time and budget constraints of the company and
+
+ additional
+ legal complexities of a proposed business combination that would be time-consuming and
+ burdensome to present to stockholders.
+
+ 
+
+ 91
+
+ 
+
+ 
+
+ 
+
+Permitted
+Purchases of our Securities
+
+ 
+
+If
+we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
+combination pursuant to the tender offer rules, our sponsor, initial stockholders, directors, officers, advisors or their affiliates
+may purchase public shares or public warrants in privately negotiated transactions or in the open market either prior to or following
+the completion of our initial business combination. There is no limit on the number of shares our initial stockholders, directors, officers
+or their affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. However, they have
+no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such
+transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material
+nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. We do not
+currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange
+Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at
+the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Any such purchases
+will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting
+requirements. None of the funds held in the trust account will be used to purchase shares or public warrants in such transactions prior
+to completion of our initial business combination.
+
+ 
+
+The
+purpose of any such purchases of shares could be to vote such shares in favor of the initial business combination and thereby increase
+the likelihood of obtaining stockholder approval of the initial business combination or to satisfy a closing condition in an agreement
+with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination,
+where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce
+the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection
+with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination
+that may not otherwise have been possible. In addition, if such purchases are made, the public "float" of our shares of Class
+A common stock or warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult
+to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange.
+
+ 
+
+Our
+sponsor, officers, directors and/or their affiliates anticipate that they may identify the stockholders with whom our sponsor, officers,
+directors or their affiliates may pursue privately negotiated purchases by either the stockholders contacting us directly or by our receipt
+of redemption requests submitted by stockholders following our mailing of proxy materials in connection with our initial business combination.
+To the extent that our sponsor, officers, directors or their affiliates enter into a private purchase, they would identify and contact
+only potential selling stockholders who have expressed their election to redeem their shares for a pro rata share of the trust account
+or vote against our initial business combination, whether or not such stockholder has already submitted a proxy with respect to our initial
+business combination. Our sponsor, officers, directors or their affiliates will only purchase public shares if such purchases comply
+with Regulation M under the Exchange Act and the other federal securities laws.
+
+ 
+
+Any
+purchases by our sponsor, officers, directors and/or their affiliates who are affiliated purchasers under Rule 10b-18 under the Exchange
+Act will only be made to the extent such purchases are able to be made in compliance with Rule 10b-18, which is a safe harbor from liability
+for manipulation under Section 9(a)(2) and Rule 10b-5 of the Exchange Act. Rule 10b-18 has certain technical requirements that must be
+complied with in order for the safe harbor to be available to the purchaser. Our sponsor, officers, directors and/or their affiliates
+will not make purchases of common stock if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. We expect that
+any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchases are subject
+to such reporting requirements.
+
+ 
+
+ 92
+
+ 
+
+ 
+
+ 
+
+Redemption
+Rights for Public Stockholders upon Completion of our Initial Business Combination
+
+ 
+
+We
+will provide our public stockholders with the opportunity to redeem all or a portion of their shares of Class A common stock upon the
+completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in
+the trust account as of two business days prior to the consummation of the initial business combination including interest earned on
+the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public
+shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be approximately $10.00
+per public share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred
+underwriting commissions we will pay to the underwriters. Our sponsor, officers and directors have entered into a letter agreement with
+us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and placement shares and any
+public shares held by them in connection with the completion of our initial business combination.
+
+ 
+
+Manner
+of Conducting Redemptions
+
+ 
+
+We
+will provide our public stockholders with the opportunity to redeem all or a portion of their public shares of Class A common stock upon
+the completion of our initial business combination either (i) in connection with a stockholder meeting called to approve the initial
+business combination or (ii) by means of a tender offer. The decision as to whether we will seek stockholder approval of a proposed initial
+business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors
+such as the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval under the
+law or stock exchange listing requirement. Under Nasdaq rules, asset acquisitions and stock purchases would not typically require stockholder
+approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding
+common stock or seek to amend our amended and restated certificate of incorporation would require stockholder approval. If we structure
+an initial business combination with a target company in a manner that requires stockholder approval, we will not have discretion as
+to whether to seek a stockholder vote to approve the proposed initial business combination. We may conduct redemptions without a stockholder
+vote pursuant to the tender offer rules of the SEC unless stockholder approval is required by law or stock exchange listing requirements
+or we choose to seek stockholder approval for business or other legal reasons. So long as we obtain and maintain a listing for our securities
+on Nasdaq, we will be required to comply with such rules.
+
+ 
+
+If
+stockholder approval of the transaction is required by law or stock exchange listing requirement, or we decide to obtain stockholder
+approval for business or other legal reasons, we will, pursuant to our amended and restated certificate of incorporation:
+
+ 
+
+ 
+ 
+ conduct
+ the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation
+ of proxies, and not pursuant to the tender offer rules, and
+
+ 
+
+ 
+ 
+ file
+ proxy materials with the SEC.
+
+ 
+
+In
+the event that we seek stockholder approval of our initial business combination, we will distribute proxy materials and, in connection
+therewith, provide our public stockholders with the redemption rights described above upon completion of the initial business combination.
+
+ 
+
+If
+we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of common
+stock present and entitled to vote at the meeting to approve the initial business combination when a quorum is present are voted in favor
+of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of
+outstanding capital stock of the Company representing a majority of the voting power of all outstanding shares of capital stock of the
+Company entitled to vote at such meeting. Our initial stockholders will count toward this quorum and pursuant to the letter agreement,
+our sponsor, officers and directors have agreed to vote any founder shares and placement shares held by them and any public shares acquired
+during or after this offering (including in open market and privately negotiated transactions) in favor of our initial business combination.
+For purposes of seeking approval of the majority of our outstanding shares of common stock voted, non-votes will have no effect on the
+approval of our initial business combination once a quorum is obtained. As a result, in addition to our initial stockholders founder
+shares and placement shares, we would need 218,331, or 2.9%, of the 7,500,000 public shares sold in this offering to be
+voted in favor of an initial business combination (assuming only the minimum number of shares representing a quorum are voted) in order
+to have our initial business combination approved (assuming the over-allotment option is not exercised, and that the initial stockholders
+do not purchase any units in this offering or units or shares in the after-market). We intend to give approximately 30 days (but not
+less than 10 days nor more than 60 days) prior written notice of any such meeting, if required, at which a vote shall be taken to approve
+our initial business combination. These quorum and voting thresholds, and the voting agreements of our initial stockholders, may make
+it more likely that we will consummate our initial business combination. Each public stockholder may elect to redeem its public shares
+irrespective of whether they vote for or against the proposed transaction.
+
+ 
+
+ 93
+
+ 
+
+ 
+
+ 
+
+If
+a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other legal reasons, we will, pursuant
+to our amended and restated certificate of incorporation:
+
+ 
+
+ 
+ 
+ conduct
+ the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and
+
+ 
+
+ 
+ 
+ file
+ tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial
+ and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the
+ Exchange Act, which regulates the solicitation of proxies.
+
+ 
+
+Upon
+the public announcement of our initial business combination, we or our sponsor will terminate any plan established in accordance with
+Rule 10b5-1 to purchase shares of our Class A common stock in the open market if we elect to redeem our public shares through a tender
+offer, to comply with Rule 14e-5 under the Exchange Act.
+
+ 
+
+In
+the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days,
+in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until
+the expiration of the tender offer period. In addition, we will not redeem any public shares unless our net tangible assets will be at
+least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters 
+fees and commissions (so that we are not subject to the SEC s "penny stock" rules) or any greater net tangible asset
+or cash requirement which may be contained in the agreement relating to our initial business combination. If public stockholders tender
+more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination.
+
+ 
+
+Our
+amended and restated certificate of incorporation will provide that we may not redeem our public shares unless our net tangible assets
+are at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters 
+fees and commissions (so that we are not subject to the SEC s "penny stock" rules) or any greater net tangible asset
+or cash requirement which may be contained in the agreement relating to our initial business combination. For example, the proposed initial
+business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target
+for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with
+the terms of the proposed initial business combination. In the event the aggregate cash consideration we would be required to pay for
+all shares of Class A common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant
+to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will not complete the
+initial business combination or redeem any shares, and all shares of Class A common stock submitted for redemption will be returned to
+the holders thereof.
+
+ 
+
+Limitation
+on Redemption upon Completion of our Initial Business Combination if we Seek Stockholder Approval
+
+ 
+
+Notwithstanding
+the foregoing, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with
+our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide
+that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in
+concert or as a "group" (as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights
+with respect to more than an aggregate of 15% of the shares sold in this offering, which we refer to as the "Excess Shares."
+Such restriction shall also be applicable to our affiliates. We believe this restriction will discourage stockholders from accumulating
+large blocks of shares, and subsequent attempts by such holders to use their ability to exercise their redemption rights against a proposed
+initial business combination as a means to force us or our management to purchase their shares at a significant premium to the then-current
+market price or on other undesirable terms. By limiting our stockholders ability to redeem no more than 15% of the shares sold
+in this offering without our prior consent, we believe we will limit the ability of a small group of stockholders to unreasonably attempt
+to block our ability to complete our initial business combination, particularly in connection with an initial business combination with
+a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be
+restricting our stockholders ability to vote all of their shares (including Excess Shares) for or against our initial business
+combination.
+
+ 
+
+Our public shareholders will
+not have the right to vote upon or redeem their shares in connection with any extensions from the initial 12 month period following this
+offering, provided that the conditions for any such extensions have been satisfied.
+
+ 
+
+ 94
+
+ 
+
+ 
+
+ 
+
+Tendering
+Stock Certificates in Connection with Redemption Rights
+
+ 
+
+We
+may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares
+in "street name," to either tender their certificates to our transfer agent up to two business days prior to the vote on
+the proposal to approve the initial business combination, or to deliver their shares to the transfer agent electronically using the Depository
+Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option. The proxy materials that we will furnish
+to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public stockholders
+to satisfy such delivery requirements. Accordingly, a public stockholder would have up to two days prior to the vote on the initial business
+combination to tender its shares if it wishes to seek to exercise its redemption rights. Given the relatively short exercise period,
+it is advisable for stockholders to use electronic delivery of their public shares.
+
+ 
+
+There
+is a nominal cost associated with the above-referenced tendering process and the act of certificating the shares or delivering them through
+the DWAC System. The transfer agent will typically charge the tendering broker $80.00 and it would be up to the broker whether or not
+to pass this cost on to the redeeming holder. However, this fee would be incurred regardless of whether or not we require holders seeking
+to exercise redemption rights to tender their shares. The need to deliver shares is a requirement of exercising redemption rights regardless
+of the timing of when such delivery must be effectuated.
+
+ 
+
+The
+foregoing is different from the procedures used by many special purpose acquisition companies. In order to perfect redemption rights
+in connection with their business combinations, many blank check companies would distribute proxy materials for the stockholders 
+vote on an initial business combination, and a holder could simply vote against a proposed initial business combination and check a box
+on the proxy card indicating such holder was seeking to exercise his or her redemption rights. After the initial business combination
+was approved, the company would contact such stockholder to arrange for him or her to deliver his or her certificate to verify ownership.
+As a result, the stockholder then had an "option window" after the completion of the initial business combination during
+which he or she could monitor the price of the company s stock in the market. If the price rose above the redemption price, he
+or she could sell his or her shares in the open market before actually delivering his or her shares to the company for cancellation.
+As a result, the redemption rights, to which stockholders were aware they needed to commit before the stockholder meeting, would become
+"option" rights surviving past the completion of the initial business combination until the redeeming holder delivered its
+certificate. The requirement for physical or electronic delivery prior to the meeting ensures that a redeeming holder s election
+to redeem is irrevocable once the initial business combination is approved.
+
+ 
+
+Any
+request to redeem such shares, once made, may be withdrawn at any time up to the date of the stockholder meeting. Furthermore, if a holder
+of a public share delivered its certificate in connection with an election of redemption rights and subsequently decides prior to the
+applicable date not to elect to exercise such rights, such holder may simply request that the transfer agent return the certificate (physically
+or electronically). It is anticipated that the funds to be distributed to holders of our public shares electing to redeem their shares
+will be distributed promptly after the completion of our initial business combination.
+
+ 
+
+If
+our initial business combination is not approved or completed for any reason, then our public stockholders who elected to exercise their
+redemption rights would not be entitled to redeem their shares for the applicable pro rata share of the trust account. In such case,
+we will promptly return any certificates delivered by public holders who elected to redeem their shares.
+
+ 
+
+ 95
+
+ 
+
+ 
+
+ 
+
+If
+our initial proposed initial business combination is not completed, we may continue to try to complete an initial business combination
+with a different target until 12 months from the closing of this offering (or up to 18 months if extended as described elsewhere
+in this prospectus). 
+
+ 
+
+Redemption
+of Public Shares and Liquidation if no Initial Business Combination
+
+ 
+
+Our amended and restated certificate
+of incorporation will provide that we will have only 12 months from the closing of this offering to complete an initial business combination
+which may be extended to up to 18 months as described elsewhere in this prospectus. If we are unable to complete our initial business
+combination within such 12-month period (or up to 18 months if extended as described elsewhere in this prospectus), we
+will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business
+days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the
+trust account including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less
+up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will
+completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions,
+if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of
+our remaining stockholders and our board of directors, dissolve and liquidate, subject in the case of clauses (ii) and (iii) above to
+our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no
+redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete an initial
+business combination within 12 months from the closing of this offering (or up to 18 months if extended as described elsewhere
+in this prospectus).
+
+ 
+
+Our sponsor, officers and directors
+have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust
+account with respect to any founder shares and placement shares held by them if we fail to complete our initial business combination
+within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if extended as
+described elsewhere in this prospectus). However, if our sponsor, officers or directors acquire public shares in or after this offering,
+they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete an
+initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering
+if extended as described elsewhere in this prospectus).
+
+ 
+
+Our sponsor, officers and directors
+have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate
+of incorporation (i) to modify the substance or timing of our obligation to allow redemption in connection with our initial business
+combination or certain amendments to our amended and restated certificate of incorporation prior thereto or to redeem 100% of our public
+shares if we do not complete an initial business combination within 12 months from the closing of this offering (or up to 18 months
+from the closing of this offering if extended as described elsewhere in this prospectus) or (ii) with respect to any other provision
+relating to stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the
+opportunity to redeem their shares of Class A common stock upon approval of any such amendment at a per-share price, payable in cash,
+equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and
+not previously released to us to pay our taxes divided by the number of then outstanding public shares. However, we may not redeem our
+public shares unless our net tangible assets are at least $5,000,001 either immediately prior to or upon consummation of our initial
+business combination and after payment of underwriters fees and commissions (so that we are not subject to the SEC s "penny
+stock" rules). If this optional redemption right is exercised with respect to an excessive number of public shares such that we
+cannot satisfy the net tangible asset requirement (described above), we would not proceed with the amendment or the related redemption
+of our public shares at such time.
+
+ 
+
+We
+expect that all costs and expenses associated with implementing our plan of dissolution, as well as payments to any creditors, will be
+funded from amounts remaining out of the approximately $950,000 of proceeds held outside the trust account, although we cannot
+assure you that there will be sufficient funds for such purpose. We will depend on sufficient interest being earned on the proceeds held
+in the trust account to pay any tax obligations we may owe. However, if those funds are not sufficient to cover the costs and expenses
+associated with implementing our plan of dissolution, to the extent that there is any interest accrued in the trust account not required
+to pay taxes, we may request the trustee to release to us an additional amount of up to $100,000 of such accrued interest to pay those
+costs and expenses.
+
+ 
+
+ 96
+
+ 
+
+ 
+
+ 
+
+If
+we were to expend all of the net proceeds of this offering and the sale of the placement units, other than the proceeds deposited in
+the trust account, and without taking into account interest, if any, earned on the trust account, the per-share redemption amount received
+by stockholders upon our dissolution would be approximately $10.15. The proceeds deposited in the trust account could, however,
+become subject to the claims of our creditors which would have higher priority than the claims of our public stockholders. We cannot
+assure you that the actual per-share redemption amount received by stockholders will not be substantially less than $10.15. Under
+Section 281(b) of the DGCL, our plan of dissolution must provide for all claims against us to be paid in full or make provision for payments
+to be made in full, as applicable, if there are sufficient assets. These claims must be paid or provided for before we make any distribution
+of our remaining assets to our stockholders. While we intend to pay such amounts, if any, we cannot assure you that we will have funds
+sufficient to pay or provide for all creditors claims.
+
+ 
+
+Although
+we will seek to have all vendors, service providers, prospective target businesses or other entities with which we do business execute
+agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit
+of our public stockholders, there is no guarantee that they will execute such agreements or even if they execute such agreements that
+they would be prevented from bringing claims against the trust account including but not limited to fraudulent inducement, breach of
+fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order
+to gain an advantage with respect to a claim against our assets, including the funds held in the trust account. If any third party refuses
+to execute an agreement waiving such claims to the monies held in the trust account, our management will perform an analysis of the alternatives
+available to it and will only enter into an agreement with a third party that has not executed a waiver if management believes that such
+third party s engagement would be significantly more beneficial to us than any alternative. Examples of possible instances where
+we may engage a third party that refuses to execute a waiver include the engagement of a third party consultant whose particular expertise
+or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver
+or in cases where management is unable to find a service provider willing to execute a waiver. 
+
+ 
+
+MaloneBailey
+LLP, our independent registered public accounting firm, and the underwriters
+of the offering, will not execute agreements with us waiving such claims to the monies held in the trust account.
+
+ 
+
+In
+addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising
+out of, any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason. Our sponsor
+has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us,
+or a prospective target business with which we have entered into a written letter of intent, confidentiality or similar agreement or
+business combination agreement, reduce the amount of funds in the trust account to below the lesser of (i) $10.15 per public share
+and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account, if less
+than $10.15 per share due to reductions in the value of the trust assets, less taxes payable, provided that such liability will
+not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held
+in the trust account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters
+of this offering against certain liabilities, including liabilities under the Securities Act. However, we have not asked our sponsor
+to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy
+its indemnity obligations and believe that our sponsor s only assets are securities of our company. Therefore, we cannot assure
+you that our sponsor would be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third
+parties including, without limitation, claims by vendors and prospective target businesses.
+
+ 
+
+In
+the event that the proceeds in the trust account are reduced below (i) $10.15 per public share or (ii) such lesser amount per
+public share held in the trust account as of the date of the liquidation of the trust account, due to reductions in value of the trust
+assets, in each case net of the amount of interest which may be withdrawn to pay taxes, and our sponsor asserts that it is unable to
+satisfy its indemnification obligations or that it has no indemnification obligations related to a particular claim, our independent
+directors would determine whether to take legal action against our sponsor to enforce its indemnification obligations. While we currently
+expect that our independent directors would take legal action on our behalf against our sponsor to enforce its indemnification obligations
+to us, it is possible that our independent directors in exercising their business judgment may choose not to do so if, for example, the
+cost of such legal action is deemed by the independent directors to be too high relative to the amount recoverable or if the independent
+directors determine that a favorable outcome is not likely. We have not asked our sponsor to reserve for such indemnification obligations
+and we cannot assure you that our sponsor would be able to satisfy those obligations. Accordingly, we cannot assure you that due to claims
+of creditors the actual value of the per-share redemption price will not be less than $10.15 per public share.
+
+ 
+
+ 97
+
+ 
+
+ 
+
+ 
+
+We will seek to reduce the possibility
+that our sponsor will have to indemnify the trust account due to claims of creditors by endeavoring to have all vendors, service providers,
+prospective target businesses or other entities with which we do business execute agreements with us waiving any right, title, interest
+or claim of any kind in or to monies held in the trust account. Our sponsor will also not be liable as to any claims under our indemnity
+of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. We will have access
+to up to approximately $950,000 from the proceeds of this offering and the sale of the placement units with which to pay any such
+potential claims (including costs and expenses incurred in connection with our liquidation, currently estimated to be no more than approximately
+$100,000). In the event that we liquidate and it is subsequently determined that the reserve for claims and liabilities is insufficient,
+stockholders who received funds from our trust account could be liable for claims made by creditors. In the event that our offering expenses
+exceed our estimate of $451,435, we may fund such excess with funds from the funds not to be held in the trust account. In such case,
+the amount of funds we intend to be held outside the trust account would decrease by a corresponding amount. Conversely, in the event
+that the offering expenses are less than our estimate of $451,435, the amount of funds we intend to be held outside the trust account
+would increase by a corresponding amount. 
+
+Under the DGCL, stockholders may
+be held liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution. The
+pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event we
+do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months
+from the closing of this offering if extended as described elsewhere in this prospectus) may be considered a liquidating distribution
+under Delaware law. If the corporation complies with certain procedures set forth in Section 280 of the DGCL intended to ensure that
+it makes reasonable provision for all claims against it, including a 60-day notice period during which any third-party claims can be
+brought against the corporation, a 90-day period during which the corporation may reject any claims brought, and an additional 150-day
+waiting period before any liquidating distributions are made to stockholders, any liability of stockholders with respect to a liquidating
+distribution is limited to the lesser of such stockholder s pro rata share of the claim or the amount distributed to the stockholder,
+and any liability of the stockholder would be barred after the third anniversary of the dissolution.
+
+ 
+
+Furthermore,
+if the pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event
+we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months
+from the closing of this offering if extended as described elsewhere in this prospectus), is not considered a liquidating distribution
+under Delaware law and such redemption distribution is deemed to be unlawful (potentially due to the imposition of legal proceedings
+that a party may bring or due to other circumstances that are currently unknown), then pursuant to Section 174 of the DGCL, the statute
+of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as
+in the case of a liquidating distribution. If we are unable to complete an initial business combination within 12 months from the closing
+of this offering (or up to 18 months from the closing of this offering if extended as described elsewhere in this prospectus),
+we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten
+business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit
+in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our taxes
+(less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption
+will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions,
+if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of
+our remaining stockholders and our board of directors, dissolve and liquidate, subject in the case of clauses (ii) and (iii) above to
+our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. Accordingly, it is
+our intention to redeem our public shares as soon as reasonably possible following the 12th
+month from the closing of this offering in the event we do not complete an initial business
+combination within 12 months from the closing of this offering and it is our intention to redeem our public shares as soon as reasonably
+possible following the 12th month (or up to 18th month) from the closing of this offering in the
+event we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18
+months from the closing of this offering if extended as described elsewhere in this prospectus) and, therefore, we do not intend to comply
+with those procedures. As such, our stockholders could potentially be liable for any claims to the extent of distributions received by
+them (but no more) and any liability of our stockholders may extend well beyond the third anniversary of such date.
+
+ 
+
+ 98
+
+ 
+
+ 
+
+ 
+
+Because
+we will not be complying with Section 280, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us at such
+time that will provide for our payment of all existing and pending claims or claims that may be potentially brought against us within
+the subsequent 10 years. However, because we are a blank check company, rather than an operating company, and our operations will be
+limited to searching for prospective target businesses to acquire, the only likely claims to arise would be from our vendors (such as
+lawyers, investment bankers, etc.) or prospective target businesses. As described above, pursuant to the obligation contained in our
+underwriting agreement, we will seek to have all vendors, service providers, prospective target businesses or other entities with which
+we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust
+account. As a result of this obligation, the claims that could be made against us are significantly limited and the likelihood that any
+claim that would result in any liability extending to the trust account is remote. Further, our sponsor may be liable only to the extent
+necessary to ensure that the amounts in the trust account are not reduced below (i) $10.15 per public share or (ii) such lesser
+amount per public share held in the trust account as of the date of the liquidation of the trust account, due to reductions in value
+of the trust assets, in each case net of the amount of interest withdrawn to pay taxes and will not be liable as to any claims under
+our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. In the
+event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent
+of any liability for such third-party claims.
+
+ 
+
+If
+we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the proceeds held in the
+trust account could be subject to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of
+third parties with priority over the claims of our stockholders. To the extent any bankruptcy claims deplete the trust account, we cannot
+assure you we will be able to return $10.15 per share to our public stockholders. Additionally, if we file a bankruptcy petition
+or an involuntary bankruptcy petition is filed against us that is not dismissed, any distributions received by stockholders could be
+viewed under applicable debtor/creditor and/or bankruptcy laws as either a "preferential transfer" or a "fraudulent
+conveyance." As a result, a bankruptcy court could seek to recover some or all amounts received by our stockholders. Furthermore,
+our board of directors may be viewed as having breached its fiduciary duty to our creditors and/or may have acted in bad faith, thereby
+exposing itself and our company to claims of punitive damages, by paying public stockholders from the trust account prior to addressing
+the claims of creditors. We cannot assure you that claims will not be brought against us for these reasons.
+
+ 
+
+Our public stockholders will be
+entitled to receive funds from the trust account only upon the earlier to occur of: (i) the completion of our initial business combination,
+(ii) the redemption of any public shares properly tendered in connection with a stockholder vote to amend any provisions of our amended
+and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with
+our initial business combination or certain amendments to our amended and restated certificate of incorporation prior thereto or to redeem
+100% of our public shares if we do not complete an initial business combination within 12 months from the closing of this offering (or
+up to 18 months from the closing of this offering if extended as described elsewhere in this prospectus) or (B) with respect to
+any other provision relating to stockholders rights or pre-initial business combination activity, and (iii) the redemption of
+all of our public shares if we are unable to complete an initial business combination within 12 months from the closing of this offering
+(or up to 18 months from the closing of this offering if extended as described elsewhere in this prospectus), subject to applicable
+law. In no other circumstances will a stockholder have any right or interest of any kind to or in the trust account. In the event we
+seek stockholder approval in connection with our initial business combination, a stockholder s voting in connection with the initial
+business combination alone will not result in a stockholder s redeeming its shares to us for an applicable pro rata share of the
+trust account. Such stockholder must have also exercised its redemption rights as described above. These provisions of our amended and
+restated certificate of incorporation, like all provisions of our amended and restated certificate of incorporation, may be amended with
+a stockholder vote.
+
+ 
+
+ 99
+
+ 
+
+ 
+
+ 
+
+Comparison
+of Redemption or Purchase Prices in Connection with Our Initial Business Combination and if We Fail to Complete Our Initial Business
+Combination
+
+ 
+
+The following table compares the
+redemptions and other permitted purchases of public shares that may take place in connection with the completion of our initial business
+combination and if we are unable to complete an initial business combination within 12 months from the closing of this offering (or up
+to 18 months from the closing of this offering if extended as described elsewhere in this prospectus).
+
+ 
+
+ 
+ 
+ Redemptions
+ in Connection 
+
+ with our Initial Business 
+
+ Combination
+ 
+ Other
+ Permitted
+
+ Purchases
+ of 
+ Public Shares 
+ by us or our Affiliates
+
+ 
+ Redemptions
+ if we fail to 
+
+ Complete an Initial 
+
+ Business Combination
+
+ Calculation
+ of redemption price
+ 
+ Redemptions
+ at the time of our initial business combination may be made pursuant to a tender offer or in connection with a stockholder vote.
+ The redemption price will be the same whether we conduct redemptions pursuant to a tender offer or in connection with a stockholder
+ vote. In either case, our public stockholders may redeem their public shares for cash equal to the aggregate amount then on deposit
+ in the trust account as of two business days prior to the consummation of the initial business combination (which is initially anticipated
+ to be $10.15 per public share), including interest earned on the funds held in the trust account and not previously released
+ to us to pay our taxes divided by the number of then outstanding public shares, subject to the limitation that no redemptions will
+ take place if all of the redemptions would cause our net tangible assets to be less than $5,000,001 as described elsewhere in this
+ prospectus and any limitations (including but not limited to cash requirements) agreed to in connection with the negotiation of terms
+ of a proposed initial business combination.
+ 
+ If
+ we seek stockholder approval of our initial business combination, our sponsor, directors, officers or their affiliates may purchase
+ shares in privately negotiated transactions or in the open market prior to or following completion of our initial business combination.
+ There is no limit to the prices that our sponsor, directors, officers or their affiliates may pay in these transactions.
+ 
+ If
+ we are unable to complete an initial business combination within 12 months from the closing of this offering (or up to 18
+ months from the closing of this offering if extended as described elsewhere in this prospectus), we will redeem all public shares
+ at a per-share price, payable in cash, equal to the aggregate amount, then on deposit in the trust account (which is initially anticipated
+ to be $10.15 per public share) including interest earned on the funds held in the trust account and not previously released to us
+ to pay our taxes (less up to $100,000 of interest to pay dissolution expenses).
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ Impact
+ to remaining stockholders
+ 
+ The
+ redemptions in connection with our initial business combination will reduce the book value per share for our remaining stockholders,
+ who will bear the burden of the deferred underwriting commissions and taxes payable.
+ 
+ If
+ the permitted purchases described above are made there would be no impact to our remaining stockholders because the purchase price
+ would not be paid by us.
+ 
+ The
+ redemption of our public shares if we fail to complete our initial business combination will reduce the book value per share for
+ the shares held by our initial stockholders, who will be our only remaining stockholders after such redemptions.
+
+ 
+
+ 100
+
+ 
+
+ 
+
+ 
+
+Comparison
+of This Offering to Those of Blank Check Companies Subject to Rule 419
+
+ 
+
+The
+following table compares the terms of this offering to the terms of an offering by a blank check company subject to the provisions of
+Rule 419. This comparison assumes that the gross proceeds, underwriting commissions and underwriting expenses of our offering would be
+identical to those of an offering undertaken by a company subject to Rule 419, and that the underwriters will not exercise their over-allotment
+option. None of the provisions of Rule 419 apply to our offering.
+
+ 
+
+ 
+ 
+ Terms
+ of Our Offering
+ 
+ Terms
+ Under a Rule 419 Offering
+
+ Escrow
+ of offering proceeds
+ 
+ $76,125,000
+ of the net proceeds of this offering and the sale of the placement
+ units will be deposited into a trust account in the United States with Continental Stock Transfer & Trust Company acting as trustee
+ and J.P. Morgan Securities LLC acting as investment manager.
+ 
+ Approximately
+ $76,875,000 of the offering proceeds would be deposited into either an escrow account with an insured depositary institution
+ or in a separate bank account established by a broker-dealer in which the broker-dealer acts as trustee for persons having the beneficial
+ interests in the account.
+
+ 
+ 
+ 
+ 
+ 
+
+ Investment
+ of net proceeds
+ 
+ $76,125,000
+ of the net offering proceeds and the sale of the placement units
+ held in trust will be invested only in U.S. government treasury bills with a maturity of 185 days or less or in money market funds
+ meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury
+ obligations.
+ 
+ Proceeds
+ could be invested only in specified securities such as a money market fund meeting conditions of the Investment Company Act or in
+ securities that are direct obligations of, or obligations guaranteed as to principal or interest by, the United States.
+
+ 
+ 
+ 
+ 
+ 
+
+ Receipt
+ of interest on escrowed funds
+ 
+ Interest
+ on proceeds from the trust account to be paid to stockholders is reduced by (i) any taxes paid or payable, and (ii) in the event
+ of our liquidation for failure to complete our initial business combination within the allotted time, up to $100,000 of net interest
+ that may be released to us should we have no or insufficient working capital to fund the costs and expenses of our dissolution and
+ liquidation.
+ 
+ Interest
+ on funds in escrow account would be held for the sole benefit of investors, unless and only after the funds held in escrow were released
+ to us in connection with our completion of a business combination.
+
+ 
+ 
+ 
+ 
+ 
+
+ Limitation
+ on fair value or net assets of target business
+ 
+ Nasdaq
+ rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the
+ value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the income earned
+ on the trust account) at the time of the agreement to enter into the initial business combination.
+ 
+ The
+ fair value or net assets of a target business must represent at least 80% of the maximum offering proceeds.
+
+ 
+
+ 101
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Terms
+ of Our Offering
+ 
+ Terms
+ Under a Rule 419 Offering
+
+ Trading
+ of securities issued
+ 
+ We
+ expect the units will begin trading on or promptly after the date of this prospectus. The Class A common stock and warrants comprising
+ the units will begin separate trading on the 52nd day following the date of this prospectus unless the representative
+ informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described
+ below and having issued a press release announcing when such separate trading will begin. We will file the Current Report on Form
+ 8-K promptly after the closing of this offering, which is anticipated to take place three business days from the date of this prospectus.
+ If the over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, an additional Current
+ Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the over-allotment option.
+ 
+ No
+ trading of the units or the underlying Class A common stock and warrants would be permitted until the completion of a business combination.
+ During this period, the securities would be held in the escrow or trust account.
+
+ 
+ 
+ 
+ 
+ 
+
+ Exercise
+ of the warrants
+ 
+ The
+ warrants cannot be exercised until the later of 30 days after the completion of our initial business combination and 12 months
+ from the closing of this offering.
+ 
+ The
+ warrants could be exercised prior to the completion of a business combination, but securities received and cash paid in connection
+ with the exercise would be deposited in the escrow or trust account.
+
+ 
+ 
+ 
+ 
+ 
+
+ Election
+ to remain an investor
+ 
+ We
+ will provide our public stockholders with the opportunity to redeem their public shares for cash equal to their pro rata share of
+ the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business
+ combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes,
+ upon the completion of our initial business combination, subject to the limitations described herein. We may not be required by applicable
+ law or stock exchange listing requirements to hold a stockholder vote. We intend to give approximately 30 days (but not less than
+ 10 days nor more than 60 days) prior written notice of any such meeting, if required, at which a vote shall be taken to approve our
+ initial business combination. If we are not required by applicable law or stock exchange listing requirements and do not otherwise
+ decide to hold a stockholder vote, we will, pursuant to our amended and restated certificate of incorporation, conduct the redemptions
+ pursuant to the tender offer rules of the SEC and file tender offer documents with the SEC which will contain substantially the same
+ financial and other information about the initial business combination and the redemption rights as is required under the SEC s
+ proxy rules. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at
+ least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial
+ business combination until the expiration of the tender offer period. If, however, we hold a stockholder vote, we will, like many
+ blank check companies, offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules.
+ 
+ A
+ prospectus containing information pertaining to the business combination required by the SEC would be sent to each investor. Each
+ investor would be given the opportunity to notify the company in writing, within a period of no less than 20 business days and no
+ more than 45 business days from the effective date of a post-effective amendment to the company s registration statement, to
+ decide if it elects to remain a stockholder of the company or require the return of its investment. If the company has not received
+ the notification by the end of the 45th business day, funds and interest or dividends, if any, held in the trust or escrow
+ account are automatically returned to the stockholder. Unless a sufficient number of investors elect to remain investors, all funds
+ on deposit in the escrow account must be returned to all of the investors and none of the securities are issued.
+
+ 
+
+ 102
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Terms
+ of Our Offering
+ 
+ Terms
+ Under a Rule 419 Offering
+
+ 
+ 
+ If
+ we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of common
+ stock voted are voted in favor of the initial business combination. Additionally, each public stockholder may elect to redeem their
+ public shares irrespective of whether they vote for or against the proposed transaction. A quorum for such meeting will consist of
+ the holders present in person or by proxy of shares of outstanding capital stock of the company representing a majority of the voting
+ power of all outstanding shares of capital stock of the company entitled to vote at such meeting.
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ Business
+ combination deadline
+ 
+ If
+ we are unable to complete an initial business combination within 12 months from the closing of this offering, or which is extended
+ for up to two (2) successive three-month periods at our option (up to 18 months in total from the closing of this offering)
+ and provided further that our sponsor deposits into the trust account the sum of $0.20 per share (or $1,500,000
+ in the aggregate for each three-month extension, or $1,725,000 in the aggregate for each three-month extension if the
+ over-allotment option is exercised in full) we will (x) cease all operations except for the purpose of winding up, (y) as promptly
+ as reasonably possible but not more than ten (10) business days thereafter, redeem 100% of the public shares, at a per-share
+ price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds
+ held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution
+ expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders 
+ rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and
+ (z) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board
+ of directors, dissolve and liquidate, subject in the case of clauses (y) and (z) above to our obligations under Delaware law to provide
+ for claims of creditors and the requirements of other applicable law.
+ 
+ If
+ a business combination has not been completed within 12 months after the effective date of the company s registration
+ statement, funds held in the trust or escrow account are returned to investors.
+
+ 
+
+ 103
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Terms
+ of Our Offering
+ 
+ Terms
+ Under a Rule 419 Offering
+
+ Limitation
+ on redemption rights of stockholders holding more than 15% of the shares sold in this offering if we hold a stockholder vote
+ 
+ If
+ we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial
+ business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that
+ a public stockholder (including our affiliates), together with any affiliate of such stockholder or any other person with whom such
+ stockholder is acting in concert or as a "group" (as defined under Section 13 of the Exchange Act), will be restricted
+ from seeking redemption rights with respect to Excess Shares (more than an aggregate of 15% of the shares sold in this offering).
+ Our public stockholders inability to redeem Excess Shares will reduce their influence over our ability to complete our initial
+ business combination and they could suffer a material loss on their investment in us if they sell any Excess Shares in open market
+ transactions.
+ 
+ Many
+ blank check companies provide no restrictions on the ability of stockholders to redeem shares based on the number of shares held
+ by such stockholders in connection with an initial business combination.
+
+ 
+ 
+ 
+ 
+ 
+
+ Tendering
+ stock certificates in connection with redemption rights
+ 
+ We
+ may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares
+ in "street name," to either tender their certificates to our transfer agent up to two business days prior to the vote
+ on the proposal to approve the initial business combination, or to deliver their shares to the transfer agent electronically using
+ The Depository Trust Company s DWAC System, at the holder s option. The proxy materials that we will furnish to holders
+ of our public shares in connection with our initial business combination will indicate whether we are requiring public stockholders
+ to satisfy such delivery requirements. Accordingly, a public stockholder would have up to two (2) days prior to the vote on
+ the initial business combination to tender its shares if it wishes to seek to exercise its redemption rights.
+ 
+ In
+ order to perfect redemption rights in connection with their business combinations, holders could vote against a proposed initial
+ business combination and check a box on the proxy card indicating such holders were seeking to exercise their redemption rights.
+ After the business combination was approved, the company would contact such stockholders to arrange for them to deliver their certificate
+ to verify ownership.
+
+ 
+
+ 104
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Terms
+ of Our Offering
+ 
+ Terms
+ Under a Rule 419 Offering
+
+ Release
+ of funds
+ 
+ Except
+ with respect to interest earned on the funds held in the trust account that may be released to us to pay our tax obligations and
+ up to $100,000 of interest that may be used for our dissolution expenses, the proceeds held in the trust account will not be released
+ until the earliest to occur of: (i) the completion of our initial business combination, (ii) the redemption of any public shares
+ properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify
+ the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain amendments
+ to our amended and restated certificate of incorporation prior thereto or to redeem 100% of our public shares if we do not complete
+ an initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of
+ this offering if extended as described elsewhere in this prospectus) or (B) with respect to any other provision relating to stockholders 
+ rights or pre-business combination activity and (iii) the redemption of 100% of our public shares if we are unable to complete an
+ initial business combination within the required time frame (subject to the requirements of applicable law). On the completion of
+ our initial business combination, all amounts held in the trust account will be released to us, less amounts released to a separate
+ account controlled by the trustee for disbursal to redeeming stockholders. We will use these funds to pay amounts due to any public
+ stockholders who exercise their redemption rights as described above under "Redemption rights for public stockholders upon
+ completion of our initial business combination," to pay the underwriters their deferred underwriting commissions, to pay all
+ or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other
+ expenses associated with our initial business combination.
+ 
+ The
+ proceeds held in the trust account are not released until the earlier of the completion of a business combination or the failure
+ to effect a business combination within the allotted time.
+
+ 
+
+ 105
+
+ 
+
+ 
+
+ 
+
+Competition
+
+ 
+
+In
+identifying, evaluating and selecting a target business for our initial business combination, we may encounter intense competition from
+other entities having a business objective similar to ours, including other blank check companies, private equity groups and leveraged
+buyout funds, and operating businesses seeking strategic business combinations. Many of these entities are well established and have
+extensive experience identifying and effecting business combinations directly or through affiliates. Moreover, many of these competitors
+possess greater financial, technical, human and other resources than we do. Our ability to acquire larger target businesses will be limited
+by our available financial resources. This inherent limitation gives others an advantage in pursuing the initial business combination
+of a target business. Furthermore, our obligation to pay cash in connection with our public stockholders who exercise their redemption
+rights may reduce the resources available to us for our initial business combination and our outstanding warrants, and the future dilution
+they potentially represent, may not be viewed favorably by certain target businesses. Either of these factors may place us at a competitive
+disadvantage in successfully negotiating an initial business combination.
+
+ 
+
+Facilities
+
+ 
+
+Our executive offices are located
+at 281 Witherspoon Street, Suite 120, Princeton, New Jersey, 08540 and our telephone number is (609) 466-0792. Commencing on the
+date of this prospectus, we have agreed to pay Genesis Unicorn Capital, LLC, our sponsor, a total of $10,000 per month for office space,
+utilities and secretarial and administrative support. We consider our current office space adequate for our current operations.
+
+ 
+
+Employees
+
+ 
+
+We
+currently have four executive officers. These individuals are not obligated to devote any specific number of hours to our matters
+but they intend to devote as much of their time as they deem necessary, in the exercise of their respective business judgement, to our
+affairs until we have completed our initial business combination. The amount of time they will devote in any time period will vary based
+on whether a target business has been selected for our initial business combination and the stage of the initial business combination
+process we are in. We do not intend to have any full-time employees prior to the completion of our initial business combination. We do
+not have an employment agreement with any member of our management team.
+
+ 
+
+Periodic
+Reporting and Financial Information
+
+ 
+
+We
+will register our units, Class A common stock and warrants under the Exchange Act and have reporting obligations, including the requirement
+that we file annual, quarterly and current reports with the SEC. In accordance with the requirements of the Exchange Act, our annual
+reports will contain financial statements audited and reported on by our independent registered public accountants.
+
+ 
+
+ 106
+
+ 
+
+ 
+
+ 
+
+We
+will provide stockholders with audited financial statements of the prospective target business as part of the tender offer materials
+or proxy solicitation materials sent to stockholders to assist them in assessing the target business. In all likelihood, these financial
+statements will need to be prepared in accordance with, or reconciled to, GAAP, or IFRS, depending on the circumstances, and the historical
+financial statements may be required to be audited in accordance with the standards of the PCAOB. These financial statement requirements
+may limit the pool of potential targets we may conduct an initial business combination with because some targets may be unable to provide
+such statements in time for us to disclose such statements in accordance with federal proxy rules and complete our initial business combination
+within the prescribed time frame. We cannot assure you that any particular target business identified by us as a potential business combination
+candidate will have financial statements prepared in accordance with GAAP or that the potential target business will be able to prepare
+its financial statements in accordance with the requirements outlined above. To the extent that these requirements cannot be met, we
+may not be able to acquire the proposed target business. While this may limit the pool of potential business combination candidates,
+we do not believe that this limitation will be material.
+
+ 
+
+We
+will be required to evaluate our internal control procedures for the fiscal year ending December 31, 2022 as required by the Sarbanes-Oxley
+Act. Only in the event we are deemed to be a large accelerated filer or an accelerated filer, and no longer qualify as an emerging growth
+company, will we be required to have our internal control procedures audited. A target company may not be in compliance with the provisions
+of the Sarbanes-Oxley Act regarding adequacy of their internal controls. The development of the internal controls of any such entity
+to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such business combination.
+Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities
+under Section 12 of the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act.
+We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent
+to the consummation of our initial business combination.
+
+ 
+
+We
+are an "emerging growth company," as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act. As such,
+we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies
+that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor attestation
+requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic
+reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and
+stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive
+as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile.
+
+ 
+
+In
+addition, Section 107 of the JOBS Act also provides that an "emerging growth company" can take advantage of the extended
+transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other
+words, an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise
+apply to private companies. We intend to take advantage of the benefits of this extended transition period.
+
+ 
+
+We
+will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of
+the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed
+to be a large accelerated filer, which means the market value of our shares of Class A common stock that are held by non-affiliates exceeds
+$700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible
+debt during the prior three-year period. References herein to "emerging growth company" will have the meaning associated
+with it in the JOBS Act.
+
+ 
+
+Additionally,
+we are a "smaller reporting company" as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take
+advantage of certain reduced disclosure obligations, including, among other things, providing only two (2) years of audited financial
+statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common
+stock held by non-affiliates equals or exceeds $250 million as of the end of that year s second fiscal quarter, and our annual
+revenues equaled or exceeded $100 million during such completed fiscal year, or (2) the market value of our common stock held by non-affiliates
+exceeds $700 million as of the end of that year s second fiscal quarter.
+
+ 
+
+Legal
+Proceedings
+
+ 
+
+There
+is no material litigation, arbitration or governmental proceeding currently pending against us or any members of our management team
+in their capacity as such.
+
+ 
+
+ 107
+
+ 
+
+ 
+
+ 
+
+MANAGEMENT
+
+ 
+
+Officers,
+Directors and Director Nominees
+
+ 
+
+Our
+officers, directors and director nominees are as follows:
+
+ 
+
+ 
+ Name
+ 
+ Age
+ 
+ Position
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Adeoye
+ Olukotun
+ 
+ 76
+ 
+ Chief
+ Executive Officer
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Samuel
+ Lui
+ 
+ 47
+ 
+ President,
+ Chief Financial Officer, Director 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Niel Starksen
+ 
+ 65
+ 
+ Chief Scientific Officer
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Juan
+ Fernandez Pascual
+ 
+ 47
+ 
+ Chief
+ Operating Officer 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Grainne
+ Coen
+ 
+ 49
+ 
+ Director
+ Nominee and Co-Chairman
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ernest
+ Fong
+ 
+ 50
+ 
+ Director
+ Nominee and Co-Chairman
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Chung Fan Cheng 
+ 
+ 41
+ 
+ Director Nominee
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Teck-Yong Heng
+ 
+ 47
+ 
+ Director Nominee
+
+ 
+ 
+
+Our
+principal office is located in the United States and our Chief Executive Officer is a United States citizen and located in the United
+States. Our sponsor is a Delaware limited liability company. Additionally, the two Co-Chairs of our Board of Directors are not residents
+of or located in China, Hong Kong or Macau. Of the five (5) Board members, four (4) are citizens of countries other than China, Hong
+Kong or Macau.
+
+ 
+
+Adeoye
+(Oye) Olukotun, MD, MPH
+
+ 
+
+Dr. Adeoye Olukotun, age 76, has served as our
+Chief Executive Officer since October 2021. Dr. Olukotun is a Mayo Clinic trained cardiologist who currently serves as the Chief Executive
+Officer of CR Strategies, LLC a position he has held since April 2000. He previously served as the Chief Executive Officer and
+President of Epigen Pharmaceuticals, Inc. from June 2014 to March 2017, and Vice Chairman of CardioVax, Inc., from January 2013
+to April 2016. Dr. Olukotun served as the Chief Medical Officer of VIA Pharmaceuticals Inc. from 2004 to 2008. He spent the first
+20 years of his career in roles of increasing responsibility in clinical development at Pfizer, Bristol-Myers Squibb, and Mallinckrodt.
+He has over 35 years of experience in the pharmaceutical industry and has been instrumental in the approval and success of numerous cardiology
+and metabolic medicines, including the first daily beta blocker and the first approved ACE inhibitor, among others. Dr. Olukotun currently
+serves on the board of directors for Tonix Pharmaceuticals Holding Corp., (NASDAQ: TNXP) and Arrowhead Pharmaceuticals, Inc. (NASDAQ:
+ARWR). Dr. Olukotun received his Medical Doctor degree from the Albert Einstein College of Medicine in New York in 1973, undertook his
+specialty in cardiovascular medicine at the Mayo Clinic and Mayo Graduate School of Medicine from 1973 to 1978 and received a master
+in public health degree from Harvard University School of Public Health in 1983. Further, Dr. Olukotun received his bachelor of arts
+from the University of North Carolina at Chapel Hill in 1969.
+
+ 
+
+Samuel
+Lui
+
+ 
+
+Samuel
+Lui, age 47, has served as our President, Chief Financial Officer and director since October 2021. Mr. Lui has over 23 years of
+experience in capital markets, investment banking, private equity, accounting and auditing. Since July 2016, he has been the founder
+and managing director of LV Capital Limited, a private investment company focused on later stage/pre-IPO investments and specializes
+in helping investee companies to list on major exchanges such as NASDAQ and The Stock Exchange of Hong Kong Limited
+("HKEX"). Since December 2011, he has served as a board member of the private equity funds at Rockstead Capital Private
+Limited, a registered fund management company under the Monetary Authority of Singapore. Since November 2016, he has also been a
+non-executive director of EFT Solutions Holdings Limited (HKEX:8062). From December 2013 to May 2015, Mr. Lui was the chief
+financial officer of ELL Environmental Holdings Limited (HKEX: 1395). From May 2007 to May 2009, Mr. Lui was a director within the
+financial sponsors group, investment banking division of Merrill Lynch in Hong Kong and Singapore. Prior to that, Mr. Lui worked as
+an assistant director of the financial sponsors group at ABN AMRO Bank N.V., Hong Kong branch, from August 2005 to April 2007. From
+July 2004 to August 2005, Mr. Lui was a vice president at the project finance and advisory department of Soci t 
+G n rale Asia Limited. Prior to that, Mr. Lui served as a manager of project and export finance at The Hongkong and
+Shanghai Banking Corporation Limited from May 2003 to June 2004. From August 1998 to April 2003, Mr. Lui worked in the audit and
+corporate finance departments of Arthur Andersen and Ernest & Young in Singapore. Mr. Lui obtained a bachelor degree in
+accountancy from Nanyang Technological University in Singapore in July 1998. Mr. Lui has been a member of the Institute of Singapore
+Chartered Accountants since October 2002.
+
+ 
+
+Niel
+Starksen
+
+ 
+
+Dr. Niel Starksen, age 65, has served as our Chief
+Scientific Officer since October 2021. Dr. Starksen is an entrepreneur, physician and scientist. He is a pioneer of percutaneous therapeutic
+technologies for structural heart disease and congestive heart failure. Dr. Starksen is an inventor on 18 issued patents and over 20
+patents pending. Dr. Starksen previously served as Chief Executive Officer of Guided Delivery Systems (now known as Ancora Heart) from
+September 2002 to July 2015 and, since September 2018, is a director and cofounder of Vivalink Medical, a provider of connected healthcare
+solutions for remote patient monitoring.He has been an advisor to Xcures (a platform for virtual clinical trials) since September 2018,
+and an advisor to Well Advised (a medical fintech platform) since September 2019. He is a Director of the Board of Governors, Johns Hopkins
+Wilmer Eye Institute. Dr. Starksen received his Medical Doctor degree from The John Hopkins University School of Medicine in June 1982,
+completed an internal medicine residency program at Harvard Medical School in April 1985 and completed his specialty in cardiovascular
+medicine at the School of Medicine, University of California, San Francisco in July 1990. Further, Dr. Starksen received his bachelor
+of science degree summa cum laude from the University of California, Irvine in June 1978.
+
+ 
+
+Juan
+Fernandez Pascual
+
+ 
+
+Juan Fernandez, age 47, has served
+as our Chief Operating Officer since October 2021. Mr. Fernandez has most recently served as the General Manager of Chassis
+Brakes International Spain, part of Hitachi Automotive Systems since April 2019 to February 2021 and was based in San Felices de
+Buelna, Autonom a de Cantabria, Spain. Mr. Fernandez is an adviser to another SPAC entity, Benessere Capital
+Acquisition which completed its initial public offering in January 2021. Benessere Capital Acquisition has focused its search on
+technology-focused middle market and emerging growth companies in North, Central and South America. Mr. Fernandez served as the
+President of Gira Cluster of Automotive Industries of Cantabria from May 2019 to March 2021 and was based in Spain. From September
+2018 to April 2019, Mr. Fernandez served as the Smart Factory Platform Leader of Linxens based in Levallois, le-de-France,
+France. From January 2017 to April 2019, Mr. Fernandez served as the Site Director of Linxens. From September 2015 to December 2016,
+Mr. Fernandez served as the Senior Area Sales Manager Southern Europe for Quintus Technologies, based in Vasteras, Sweden. From
+September 2014 to September 2015, Mr. Fernandez served as the Site Director of Hutchinson based in Ch teaudun, France. From
+April 2013 to August 2014, Mr. Fernandez served as the Production Area Manager of Gestamp based in Le Theil, Basse-Normandie,
+France. From November 2005 to March 2013, Mr. Fernandez served as Process Engineer Manager at ArcelorMittal Aviles, Spain. From
+September 2003 to October 2005, Mr. Fernandez served as Resident Engineer of ArcelorMittal based Electrolux premises in Conegliano,
+Veneto, Italy. In 2018, Mr. Fernandez received his Executive MBA degree at ESCP Europe. In 1999, Mr. Fernandez received his DEA
+(Master in Sciences) at Ecole Polytechnique.
+
+ 
+
+ 108
+
+ 
+
+ 
+
+ 
+
+Grainne
+Coen
+
+ 
+
+Grainne
+Coen, age 49, will be one of our independent directors and Co-Chairman of the Board as of the effective date of the registration
+statement of which this prospectus forms a part. Ms. Coen is a board member of Commonwealth Credit Partners BDC I, Inc., a business
+development company, and became Chair of the Audit Committee since June 2021. In May 2018, she founded and has remained a partner of
+Elevation Investment Partners, LLC, a diversified investment group operating in multiple industries both as strategic consultants
+and early-stage investors. Since January 2015, Ms. Coen has also served as Co-Founder and Chairperson of AREA4, LLC, an experiential
+marketing agency. From August 2001 to December 2015, she was a principal and portfolio manager at Columbia Partners, LLC Investment
+Management, where she co-managed over $1 billion in assets held in the fund s U.S. Small Cap Equity Fund. From September 1998
+to March 2001, she was a General Partner at Kensington Partners, LLC, and from May 1996 to August 1998, she was employed at G&O
+Partners, LP. Since October 2019, Ms. Coen also has served as the Chair of the audit committee of Kubient, Inc. (NASDAQ: KBNT), a
+digital marketing platform, and from March 2019 to December 2020, as Chair of the board of directors of ERIE ARMADA, Inc., a
+non-profit focused on the development of underserved communities in conjunction with New York City s Parks and Trails
+Department. Ms. Coen holds a Bachelor of Science from London Guildhall University.
+
+ 
+
+Ernest
+Fong 
+
+ 
+
+Ernest
+Fong, age 50, will be one of our independent directors and Co-Chairman of the Board as of the effective date of the registration
+statement of which this prospectus forms a part. Since October 2021, Mr. Fong has been the Asia Pacific CEO of Optimas Capital, an
+Asian-based Hedge Fund with offices in Hong Kong, Singapore and Taiwan. Mr. Fong joined Credit Suisse in March 1998 and after
+spending more than 21 years in its Singapore, Taiwan and Hong Kong offices, he retired from Credit Suisse in December 2019. His last
+position in Credit Suisse was as the Head of Markets Research in Asia Pacific and he was responsible for a team of almost 300 across
+14 offices and 12 markets. Prior to Credit Suisse, Mr. Fong was an equity research analyst at Credit Lyonnais Securities Asia from
+June 1995 to February 1998. Since June 2020, Mr. Fong is also a non-executive director of Vincom Retail, listed in Vietnam, which is
+part of the Vincom group, the largest privately-owned company in Vietnam. Ernest graduated from National University of Singapore
+with a Bachelor of Arts degree, majoring in Economics and Statistics.
+
+ 
+
+Chung
+Fan Cheng
+
+ 
+
+Chung Fan
+Cheng, age 41, will be one of our independent directors as of the effective date of the registration statement of which this prospectus
+forms a part. Mr. Cheng has over 17 years of experience in capital markets, corporate strategy, private equity, family office and entrepreneurship.
+Since Feb 2019, Mr. Cheng has served as the Chief Investment Officer of BlueTop Group, a Hong Kong based family office with core focus
+in education, human capital and technology. Mr. Cheng also serves as a non-executive director of Tsui Wah Restaurant Group (HKEX:1314)
+since November 2016, and a director of Esperanza Limited, founded by the former financial secretary of Hong Kong, since July 2021. Mr.
+Cheng s prior work includes management roles with Sail Global Capital from September 2017 to December 2018, Hao Tian International Securities
+from September 2016 to August 2017, and KGI Asia from April 2013 to September 2016. Mr. Cheng is an Engineer by training and holds a
+M.Sc. Engineering Enterprise Management, HKUST, Hong Kong and B.Sc. Engineering (1st Honors), Queen s University, Canada.
+
+ 
+
+Teck-Yong
+Heng
+
+ 
+
+Teck-Yong
+Heng, age 47, will be one of our independent directors as of the effective date of the registration statement of which this prospectus
+forms a part. Mr. Heng will bring in more than 20 years of private equity and M&A experience to the Company. Mr. Heng is a partner
+and senior management in 58.com s Investment Fund focusing on venture capital and private equity investments in the TMT and Consumer
+sectors since August 2021. Prior to joining in 58.com, Mr. Heng has operated C-Squared Partners, a China focused consumer sector private
+equity fund since May 2018. From August 2016 to May 2018, Mr. Heng was a managing director in Qianhai Ark Asset Management, a fund with
+approximately $4.5 billion under management. Prior to Qianhai Ark, Mr. Heng worked at Pavilion Capital (an affiliated entity of Temasek
+Holdings) from September 2012 to July 2016, Temasek Holdings from October 2004 to September 2012, Cambridge Associates from July 2003
+to October 2004, Singapore Power International from June 2001 to July 2003, and Arthur Andersen from July 1998 to May 2001. Mr. Heng
+has also served as independent director for LiXiang Education Holding Co. Ltd. (NASDAQ: LXEH) since October 2020, and an independent
+director for WiMi Hologram Cloud Inc. (NASDAQ: WIMI) since May 2021. Mr. Heng is also a director of another SPAC entity, Broad Capital
+Acquisition Corp. which completed its initial public offering in January 2022. Mr. Heng graduated from Nanyang Technological University
+with a bachelor s degree in Accountancy (with Honors) and is a graduate of Harvard Business School s General Management Program.
+He is a Chartered Financial Analyst (CFA), Chartered Accountant (CA), Chartered International M&A Charterholder, and a member of
+Singapore Institute of Directors.
+
+ 
+
+Advisors
+
+ 
+
+We
+have also engaged as advisors a group of individuals with extensive experience in the medical and healthcare fields.
+
+ 
+
+Dr.
+Hank Wuh, our Strategic and Scientific Advisor, is a physician, inventor, and entrepreneur. Dr. Wuh is Chief Scientific Officer of Pono
+Capital Corp. President of Unicorn Whisperer, Inc. since July 2018, a director of The Daily Wellness Company since June 1996,
+and a director of Lymphax, Inc. since December 2019. Dr. Wuh is a Trustee of the University of Hawaii Foundation since April 2020, and
+an advisor to several medical technology companies. Dr. Wuh was the CEO of SKAI Ventures from September 2010 to December 2019 and the
+Executive Chairman of TruTag Technologies, Inc. from April 2011 to Aug 2018. Dr. Wuh was a member of the Board of Directors of the Fulbright
+Association from January 2020 to August 2021, and a member of the Board of Directors of Cellular Bioengineering, Inc. from August 2003
+to August 2021. Dr. Wuh received his B.A. from Johns Hopkins, a Master of Public Health from Harvard University School of Public Health,
+Medical Doctorate from the Johns Hopkins University School of Medicine, orthopedic surgery residency at Stanford, and is Associate Clinical
+Professor of Surgery at the John A. Burns School of Medicine at the University of Hawaii.
+
+ 
+
+Dr.
+Robert Chang, our Scientific Advisor, is an associate professor and medical innovator at Stanford University. He divides his time among
+state-of-the art clinical eye care, clinical validation of digital health tools, and teaching ophthalmology and healthcare innovation
+globally. He focuses on minimally invasive glaucoma surgery (MIGS) and presbyopia-correcting cataract surgery with emphasis on precision
+medicine. He is co-inventor of the first universal smartphone adapter and the FDA-cleared PAXOS scope for portable imaging of the front
+and back of the eye. He is on the advisory board for several ophthalmic companies and serves as the Vice President of the Asia Pacific
+Tele-Ophthalmology Society (APTOS).
+
+ 
+
+In addition, in April 2021, our sponsor had
+engaged ARC Group Limited to assist and advise us in various matters related to our initial public offering, for which services ARC Group
+Limited was to be paid a fee of $10,000 a month. In August, 2021, in connection with the anticipated change of ownership of our sponsor
+(which ownership change was completed in October, 2021) we terminated the agreement with ARC Group Limited and the parties agreed that
+ARC Group Limited s role would be limited to assisting us in the preparation of financial information and financial statements
+for use in the registration statement of which this prospectus forms a part and ARC Group Limited s role will terminate upon completion
+of this offering. ARC Group Limited is not receiving any compensation for such services and neither we nor our sponsor are obligated
+to provide compensation to ARC Group Limited upon completion of this offering or in the future. We do not intend on engaging ARC Group
+Limited in the future. ARC Group Limited and its affiliates are an investment bank and advisory firm which operates outside of the United
+States and provides financial advisory, investment banking, consulting and similar services to its clients.
+
+ 
+
+The
+individuals serving as our directors and as our advisors and promoters have experience in acquiring businesses in the international
+marketplace, executive leadership, operational oversight, private equity investment management and capital markets experience in various
+industries, including healthcare. Our directors and advisors also have experience with developing corporate strategy and implementation
+and identification of new and advancing technologies, which we believe will significantly benefit us as we evaluate potential acquisition
+or merger candidates as well as following the completion of our initial business combination.
+
+ 
+
+Family
+Relationships
+
+ 
+
+There
+are no family relationships among any of our directors or executive officers that are required to be disclosed by Regulation S-K.
+
+ 
+
+Number
+and Terms of Office of Officers and Directors
+
+ 
+
+We
+will have five directors upon completion of this offering.
+
+ 
+
+ 109
+
+ 
+
+ 
+
+ 
+
+Our
+officers are appointed by the board of directors and serve at the discretion of the board of directors, rather than for specific terms
+of office. Our board of directors is authorized to appoint persons to the offices set forth in our bylaws as it deems appropriate. Our
+bylaws provide that our officers may consist of a Chairman of the Board, Chief Executive Officer, Chief Financial Officer, Chief Investment
+Officer, Chief Operating Officer, President, Vice Presidents, Secretary, Treasurer, Assistant Secretaries and such other offices as may
+be determined by the board of directors.
+
+ 
+
+Director
+Independence
+
+ 
+
+Nasdaq listing standards require
+that a majority of our board of directors be independent. An "independent director" is defined generally as a person other
+than an officer or employee of the company or its subsidiaries or any other individual having a relationship which in the opinion of
+the company s board of directors, would interfere with the director s exercise of independent judgment in carrying out the
+responsibilities of a director. We expect that our board of directors will determine that Ms. Grainne Coen, Mr. Ernest Fong, Mr. Chung Fan
+Cheng and Mr. Teck Yong Heng are "independent directors" as defined in the Nasdaq listing standards and applicable SEC
+rules. Our independent directors will have regularly scheduled meetings at which only independent directors are present.
+
+ 
+
+Officer
+and Director Compensation
+
+ 
+
+None
+of our officers has received any cash compensation for services rendered to us. Commencing on the date of this prospectus, we have agreed
+to pay Genesis Unicorn Capital, LLC, our sponsor, a total of $10,000 per month for office space, utilities and secretarial
+and administrative support. Upon completion of our initial business combination or our liquidation, we will cease paying these monthly
+fees. No compensation of any kind, including any finder s fee, reimbursement, consulting fee or monies in respect of any payment
+of a loan, will be paid by us to our sponsor, officers or directors or any affiliate of our sponsor, officers or directors, prior to,
+or in connection with any services rendered in order to effectuate, the consummation of our initial business combination (regardless
+of the type of transaction that it is). However, these individuals will be reimbursed for any out-of-pocket expenses incurred in connection
+with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business combinations.
+Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors or our or their
+affiliates. Any such payments prior to an initial business combination will be made using funds held outside the trust account. Other
+than quarterly audit committee review of such payments, we do not expect to have any additional controls in place governing our reimbursement
+payments to our directors and executive officers for their out-of-pocket expenses incurred in connection with identifying and consummating
+an initial business combination.
+
+ 
+
+After
+the completion of our initial business combination, directors or members of our management team who remain with us may be paid consulting
+or management fees from the combined company. All of these fees will be fully disclosed to stockholders, to the extent then known, in
+the tender offer materials or proxy solicitation materials furnished to our stockholders in connection with a proposed initial business
+combination. We have not established any limit on the amount of such fees that may be paid by the combined company to our directors or
+members of management. It is unlikely the amount of such compensation will be known at the time of the proposed initial business combination,
+because the directors of the post-combination business will be responsible for determining officer and director compensation. Any compensation
+to be paid to our officers will be determined, or recommended to the board of directors for determination, either by a compensation committee
+constituted solely by independent directors or by a majority of the independent directors on our board of directors.
+
+ 
+
+We
+do not intend to take any action to ensure that members of our management team maintain their positions with us after the consummation
+of our initial business combination, although it is possible that some or all of our officers and directors may negotiate employment
+or consulting arrangements to remain with us after our initial business combination. The existence or terms of any such employment or
+consulting arrangements to retain their positions with us may influence our management s motivation in identifying or selecting
+a target business but we do not believe that the ability of our management to remain with us after the consummation of our initial business
+combination will be a determining factor in our decision to proceed with any potential business combination. We are not party to any
+agreements with our officers and directors that provide for benefits upon termination of employment.
+
+ 
+
+ 110
+
+ 
+
+ 
+
+ 
+
+Committees
+of the Board of Directors
+
+ 
+
+Our
+board of directors will have two standing committees: an audit committee and a compensation committee. Subject to phase-in rules and
+a limited exception, Nasdaq rules and Rule 10A-3 of the Exchange Act require that the audit committee of a listed company be comprised
+solely of independent directors, and Nasdaq rules require that the compensation committee of a listed company be comprised solely of
+independent directors.
+
+ 
+
+Audit
+Committee
+
+ 
+
+Prior to the consummation of this
+offering, we will establish an audit committee of the board of directors. Mr. Ernest Fong, Mr. Chung Fan Cheng and Mr. Teck-Yong
+Heng will serve as members of our audit committee, and Mr. Teck-Yong Heng will chair the audit committee. Under the Nasdaq
+listing standards and applicable SEC rules, we are required to have at least three members of the audit committee, all of whom must be
+independent. Each of the members of our audit committee meet the independent director standard under Nasdaq listing standards and under
+Rule 10-A-3(b)(1) of the Exchange Act.
+
+ 
+
+Each member of the audit committee
+is financially literate and our board of directors has determined that Mr. Teck-Yong Heng qualifies as an "audit
+committee financial expert" as defined in applicable SEC rules.
+
+ 
+
+We
+will adopt an audit committee charter, which will detail the principal functions of the audit committee, including:
+
+ 
+
+ 
+ 
+ the
+ appointment, compensation, retention, replacement, and oversight of the work of the independent registered public accounting firm
+ engaged by us;
+
+ 
+ 
+ 
+
+ 
+ 
+ pre-approving
+ all audit and permitted non-audit services to be provided by the independent registered public accounting firm engaged by us, and
+ establishing pre-approval policies and procedures;
+
+ 
+ 
+ 
+
+ 
+ 
+ setting
+ clear hiring policies for employees or former employees of the independent registered public accounting firm, including but not limited
+ to, as required by applicable laws and regulations;
+
+ 
+ 
+ 
+
+ 
+ 
+ setting
+ clear policies for audit partner rotation in compliance with applicable laws and regulations;
+
+ 
+ 
+ 
+
+ 
+ 
+ obtaining
+ and reviewing a report, at least annually, from the independent registered public accounting firm describing (i) the independent
+ registered public accounting firm s internal quality-control procedures, (ii) any material issues raised by the most recent
+ internal quality-control review, or peer review, of the audit firm, or by any inquiry or investigation by governmental or professional
+ authorities within the preceding five years respecting one or more independent audits carried out by the firm and any steps taken
+ to deal with such issues and (iii) all relationships between the independent registered public accounting firm and us to assess the
+ independent registered public accounting firm s independence;
+
+ 
+ 
+ 
+
+ 
+ 
+ reviewing
+ and approving any related party transaction required to be disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC
+ prior to us entering into such transaction; and
+
+ 
+ 
+ 
+
+ 
+ 
+ reviewing
+ with management, the independent registered public accounting firm, and our legal advisors, as appropriate, any legal, regulatory
+ or compliance matters, including any correspondence with regulators or government agencies and any employee complaints or published
+ reports that raise material issues regarding our financial statements or accounting policies and any significant changes in accounting
+ standards or rules promulgated by the Financial Accounting Standards Board, the SEC or other regulatory authorities.
+
+ 
+
+ 111
+
+ 
+
+ 
+
+ 
+
+Compensation
+Committee
+
+ 
+
+Prior to the consummation of this
+offering, we will establish a compensation committee of the board of directors. Mr. Ernest Fong, Mr. Chung Fan Cheng and Mr.
+Teck-Yong Heng will serve as members of our compensation committee. Under the Nasdaq listing standards and applicable SEC rules,
+we are required to have at least two members of the compensation committee, all of whom must be independent. All the members of our committee
+are independent and Mr. Chung Fan Cheng will chair the compensation committee.
+
+ 
+
+We
+will adopt a compensation committee charter prior to closing of this Offering in the form of Exhibit 99.2 to the registration
+statement of which this prospectus forms a part, which will detail the principal functions of the compensation committee,
+including:
+
+ 
+
+ 
+ 
+ reviewing
+ and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer s compensation,
+ if any is paid by us, evaluating our Chief Executive Officer s performance in light of such goals and objectives and determining
+ and approving the remuneration (if any) of our Chief Executive Officer based on such evaluation;
+
+ 
+ 
+ 
+
+ 
+ 
+ reviewing
+ and approving on an annual basis the compensation, if any is paid by us, of all of our other officers;
+
+ 
+ 
+ 
+
+ 
+ 
+ reviewing
+ on an annual basis our executive compensation policies and plans;
+
+ 
+ 
+ 
+
+ 
+ 
+ implementing
+ and administering our incentive compensation equity-based remuneration plans;
+
+ 
+ 
+ 
+
+ 
+ 
+ assisting
+ management in complying with our proxy statement and annual report disclosure requirements;
+
+ 
+ 
+ 
+
+ 
+ 
+ approving
+ all special perquisites, special cash payments and other special compensation and benefit arrangements for our officers and employees;
+
+ 
+ 
+ 
+
+ 
+ 
+ if
+ required, producing a report on executive compensation to be included in our annual proxy statement; and
+
+ 
+ 
+ 
+
+ 
+ 
+ reviewing,
+ evaluating and recommending changes, if appropriate, to the remuneration for directors.
+
+ 
+
+Notwithstanding
+the foregoing, as indicated above, other than the payment to Genesis Unicorn Capital, LLC, our sponsor, of $10,000 per month, for up
+to 18 months, for office space, utilities and secretarial and administrative support, no compensation
+of any kind, including finders, consulting or other similar fees, will be paid to any of our existing stockholders, officers, directors
+or any of their respective affiliates, prior to, or for any services they render in order to effectuate the consummation of an initial
+business combination. Accordingly, it is likely that prior to the consummation of an initial business combination, the compensation committee
+will only be responsible for the review and recommendation of any compensation arrangements to be entered into in connection with such
+initial business combination.
+
+ 
+
+The
+charter will also provide that the compensation committee may, in its sole discretion, retain or obtain the advice of a compensation
+consultant, legal counsel or other adviser and will be directly responsible for the appointment, compensation and oversight of the work
+of any such adviser. However, before engaging or receiving advice from a compensation consultant, external legal counsel or any other
+adviser, the compensation committee will consider the independence of each such adviser, including the factors required by Nasdaq and
+the SEC.
+
+ 
+
+Nominating
+Committee
+
+ 
+
+Effective
+upon the date of this prospectus, we will establish a nominating committee of the board of directors, which will consist of Mr. Ernest
+Fong, Mr. Chung Fan Cheng and Mr. Teck-Yong Heng. Mr. Ernest Fong will serve as chairman of the Nomination committee. The nominating committee
+is responsible for overseeing the selection of persons to be nominated to serve on our board of directors. The nominating committee considers
+persons identified by its members, management, stockholders, investment bankers and others.
+
+ 
+
+Guidelines
+for Selecting Director Nominees
+
+ 
+
+The
+guidelines for selecting nominees, which are specified in the Nominating Committee Charter, generally provide that persons to be nominated:
+
+ 
+
+ 
+ 
+ 
+ should
+ have demonstrated notable or significant achievements in business, education or public service;
+
+ 
+ 
+ 
+
+ 
+ 
+ should
+ possess the requisite intelligence, education and experience to make a significant contribution to the board of directors and bring
+ a range of skills, diverse perspectives and backgrounds to its deliberations; and
+
+ 
+ 
+ 
+
+ 
+ 
+ should
+ have the highest ethical standards, a strong sense of professionalism and intense dedication to serving the interests of the shareholders.
+
+ 
+ 
+
+The
+Nominating Committee will consider a number of qualifications relating to management and leadership experience, background and integrity
+and professionalism in evaluating a person s candidacy for membership on the board of directors. The nominating committee may require
+certain skills or attributes, such as financial or accounting experience, to meet specific board needs that arise from time to time and
+will also consider the overall experience and makeup of its members to obtain a broad and diverse mix of board members. The nominating
+committee does not distinguish among nominees recommended by shareholders and other persons.
+
+ 
+
+Compensation
+Committee Interlocks and Insider Participation
+
+ 
+
+None
+of our executive officers currently serves, and in the past year has not served, as a member of the compensation committee of
+any entity that has one or more executive officers serving on our board of directors.
+
+ 
+
+ 112
+
+ 
+
+ 
+
+ 
+
+Code
+of Ethics
+
+ 
+
+Prior
+to the consummation of this offering, we will adopt a Code of Ethics applicable to our directors, officers and employees. We will
+file a copy of our Code of Ethics and our audit, compensation and nominating committee charters as exhibits to the
+registration statement of which this prospectus is a part. You will be able to review these documents by accessing our public
+filings at the SEC s web site at www.sec.gov. In addition, a copy of the Code of Ethics will be provided without charge
+upon request from us. We intend to disclose any amendments to or waivers of certain provisions of our Code of Ethics in a Current
+Report on Form 8-K. See the section of this prospectus entitled "Where You Can Find Additional Information."
+
+ 
+
+Conflicts
+of Interest
+
+ 
+
+Subject
+to pre-existing fiduciary or contractual duties as described below, our officers and directors have agreed to present any business opportunities
+presented to them in their capacity as a director or officer of our company to us. Certain of our officers and directors presently have
+fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a
+business combination opportunity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity
+which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or
+her fiduciary or contractual obligations to present such opportunity to such entity. We believe, however, that the fiduciary duties or
+contractual obligations of our officers or directors will not materially affect our ability to complete our initial business combination.
+Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered
+to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or
+officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable
+for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal
+obligation.
+
+ 
+
+ 113
+
+ 
+
+ 
+
+ 
+
+Our
+officers and directors may become officers or directors of another special purpose acquisition company with a class of securities intended
+to be registered under the Exchange Act, even prior to us entering into a definitive agreement for our initial business combination.
+
+ 
+
+Potential
+investors should also be aware of the following other potential conflicts of interest:
+
+ 
+
+ 
+ 
+ None
+ of our officers or directors is required to commit his or her full time to our affairs and, accordingly, may have conflicts of interest
+ in allocating his or her time among various business activities.
+
+ 
+ 
+ 
+
+ 
+ 
+ In
+ the course of their other business activities, our officers and directors may become aware of investment and business opportunities
+ which may be appropriate for presentation to us as well as the other entities with which they are affiliated. Our management may
+ have conflicts of interest in determining to which entity a particular business opportunity should be presented.
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ initial stockholders have agreed to waive their redemption rights with respect to any founder shares and placement shares and any
+ public shares held by them in connection with the consummation of our initial business combination. Additionally, our initial stockholders
+ have agreed to waive their redemption rights with respect to any founder shares and placement shares held by them if we fail to complete
+ an initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of
+ this offering if extended as described elsewhere in this prospectus). If we do not complete our initial business combination within
+ such applicable time period, the proceeds of the sale of the placement units held in the trust account will be used to fund the redemption
+ of our public shares, and the placement securities will expire worthless. With certain limited exceptions, the founder shares will
+ not be transferable, assignable by our sponsor until the earlier to occur of: (A) one year after the completion of our initial business
+ combination and (B) subsequent to our initial business combination, if the reported last sale price of our Class A common stock equals
+ or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for
+ any 20 trading days within any 30-trading day period commencing after our initial business combination. With certain limited exceptions,
+ the placement units, placement shares and placement warrants and the Class A common stock underlying such warrants, will not be transferable,
+ assignable or saleable by our sponsor or its permitted transferees until 30 days after the completion of our initial business combination.
+ Since our sponsor and officers and directors may directly or indirectly own common stock and warrants following this offering, our
+ officers and directors may have a conflict of interest in determining whether a particular target business is an appropriate business
+ with which to effectuate our initial business combination.
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention
+ or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect
+ to our initial business combination.
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ sponsor, officers or directors may have a conflict of interest with respect to evaluating a business combination and financing arrangements
+ as we may obtain loans from our sponsor or an affiliate of our sponsor or any of our officers or directors to finance transaction
+ costs in connection with an intended initial business combination. Up to $1,500,000 of such loans may be convertible into units,
+ at a price of $10.00 per unit at the option of the lender, upon consummation of our initial business combination. The units would
+ be identical to the placement units.
+
+ 
+
+The
+conflicts described above may not be resolved in our favor.
+
+ 
+
+In
+general, officers and directors of a corporation incorporated under the laws of the State of Delaware are required to present business
+opportunities to a corporation if:
+
+ 
+
+ 
+ 
+ the
+ corporation could financially undertake the opportunity;
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ opportunity is within the corporation s line of business; and
+
+ 
+ 
+ 
+
+ 
+ 
+ it
+ would not be fair to our company and its stockholders for the opportunity not to be brought to the attention of the corporation.
+
+ 
+
+Accordingly,
+as a result of multiple business affiliations, our officers and directors may have similar legal obligations relating to presenting business
+opportunities meeting the above-listed criteria to multiple entities. Furthermore, our amended and restated certificate of incorporation
+will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is
+expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we
+are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director
+or officer is permitted to refer that opportunity to us without violating another legal obligation.
+
+ 
+
+ 114
+
+ 
+
+ 
+
+ 
+
+Below
+is a table summarizing the entities to which our executive officers, directors and director nominees currently have fiduciary duties
+or contractual obligations: 
+
+ 
+
+ 
+ Individual(1)
+ 
+ Entity(2)
+ 
+ Entity s
+ Business
+ 
+ Affiliation
+
+ 
+ Adeoye
+ Olukotun
+ 
+ CR
+ Strategies LLC
+ 
+ Consulting
+ for the biopharmaceutical and medical devices industry
+ 
+ CEO
+ and owner
+
+ 
+ 
+ 
+ Tonix
+ Pharmaceuticals
+ 
+ Biotechnology
+ company
+ 
+ Director
+
+ 
+ 
+ 
+ Arrowhead
+ Pharmaceuticals Inc.
+ 
+ Biotechnology
+ company
+ 
+ Director
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Samuel
+ Lui
+ 
+ LV
+ Capital Limited
+
+ EFT
+ Solutions Holdings Limited
+
+ 
+ Private
+ investments and advisory
+
+ Electronic
+ fund transfer at point-of-sale solutions provider
+
+ 
+ CEO
+ and owner
+
+ Non-Executive
+ Director
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Niel
+ Starksen
+ 
+ Vivalink
+ Medical Inc
+
+ MBFNS
+ Health
+
+ 
+ Digital
+ health platform
+
+ Consulting
+ to the biotechnology, pharmaceutical and medical technology industries
+
+ 
+ Director
+
+ CEO
+ and owner
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Juan
+ Fernandez Pascual
+ 
+ Benessere
+ Capital Acquisition Corp.
+ 
+ Special
+ Purpose Acquisition Company
+ 
+ Advisor
+
+ 
+ 
+ 
+ Altanela,
+ SL
+ 
+ Consulting
+ 
+ Managing
+ Director
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Grainne
+ Coen
+ 
+ Commonwealth
+ Credit Partners BDC I, Inc.
+ 
+ Business
+ development company
+ 
+ Director,
+ Audit Committee Chair
+
+ 
+ 
+ 
+ Kubient,
+ Inc.
+ 
+ AdTech
+ company
+ 
+ Director,
+ Audit Committee Chair
+
+ 
+ 
+ 
+ Signal
+ Hill Acquisition Corp
+ 
+ Special
+ Purpose Acquisition Company
+ 
+ President,
+ CFO
+
+ 
+ 
+ 
+ Elevation
+ Partners LLC
+ 
+ Investment
+ partnership
+ 
+ Founding
+ Partner
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ernest
+ Fong
+ 
+ Optimas
+ Capital
+
+ Vincom
+ Retail Joint Stock Company
+
+ 
+ Asset
+ manager
+
+ Real
+ estate investment
+
+ 
+ CEO
+ (Asia Pacific)
+
+ Non-Executive
+ Director
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Teck-Yong Heng
+ 
+ 58
+ Investment Fund 
+ 
+ Consumer
+ and technology investments 
+ 
+ Partner,
+ Managing Director
+
+ 
+ 
+ 
+ LiXiang
+ Education Holding Co. Ltd.
+ 
+ Education
+ 
+ Independent
+ Non-Executive Director, Audit Committee Chairman
+
+ 
+ 
+ 
+ WiMi
+ Hologram Cloud Inc.
+ 
+ Augmented
+ reality and holographic solutions
+ 
+ Independent
+ Non-Executive Director, Audit Committee Chairman
+
+ 
+ 
+ 
+ Broad Acquisition Corporation
+ 
+ Special Purpose Acquisition Company
+ 
+ Director
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Chung Fan
+ Cheng
+ 
+ BlueTop
+ Group Limited
+ 
+ Education
+ and investment holdings
+ 
+ Chief
+ Investment Officer
+
+ 
+ 
+ 
+ Tsui
+ Wah Restaurant Group
+ 
+ Food
+ and beverage
+ 
+ Non-Executive
+ Director
+
+ 
+ 
+ 
+ Esperanza
+ Limited
+ 
+ Non-profit
+ organization
+ 
+ Director
+
+ 
+ 
+
+ (1)
+ Each
+ person has a fiduciary duty with respect to the listed entities next to their respective names.
+
+ 
+ 
+
+ (2)
+ Each
+ of the entities listed in this table has priority and preference relative to our company with respect to the performance by each
+ individual listed in this table of his obligations and the presentation by each such individual of business opportunities.
+
+ 
+
+Accordingly,
+if any of the above executive officers, directors or director nominees becomes aware of a business combination opportunity which is suitable
+for any of the above entities to which he or she has current fiduciary or contractual obligations, he or she will honor his or her fiduciary
+or contractual obligations to present such business combination opportunity to such entity, and only present it to us if such entity
+rejects the opportunity.
+
+ 
+
+We
+are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors.
+In the event we seek to complete our initial business combination with such a company, we, or a committee of independent directors, would
+obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions,
+that such an initial business combination is fair to our company from a financial point of view.
+
+ 
+
+In
+the event that we submit our initial business combination to our public stockholders for a vote, pursuant to the letter agreement, our
+sponsor, officers and directors have agreed to vote any founder shares or placement shares held by them and any public shares purchased
+during or after the offering (including in open market and privately negotiated transactions) in favor of our initial business combination.
+
+ 
+
+Limitation
+on Liability and Indemnification of Officers and Directors
+
+ 
+
+Our
+amended and restated certificate of incorporation will provide that our officers and directors will be indemnified by us to the fullest
+extent authorized by Delaware law, as it now exists or may in the future be amended. In addition, our amended and restated certificate
+of incorporation will provide that our directors will not be personally liable for monetary damages to us or our stockholders for breaches
+of their fiduciary duty as directors, unless they violated their duty of loyalty to us or our stockholders, acted in bad faith, knowingly
+or intentionally violated the law, authorized unlawful payments of dividends, unlawful stock purchases or unlawful redemptions, or derived
+an improper personal benefit from their actions as directors.
+
+ 
+
+We
+will enter into agreements with our officers and directors to provide contractual indemnification in addition to the indemnification
+provided for in our amended and restated certificate of incorporation. Our bylaws also will permit us to secure insurance on behalf of
+any officer, director or employee for any liability arising out of his or her actions, regardless of whether Delaware law would permit
+such indemnification. We will purchase a policy of directors and officers liability insurance that insures our officers
+and directors against the cost of defense, settlement or payment of a judgment in some circumstances and insures us against our obligations
+to indemnify our officers and directors.
+
+ 
+
+These
+provisions may discourage stockholders from bringing a lawsuit against our directors for breach of their fiduciary duty. These provisions
+also may have the effect of reducing the likelihood of derivative litigation against officers and directors, even though such an action,
+if successful, might otherwise benefit us and our stockholders. Furthermore, a stockholder s investment may be adversely affected
+to the extent we pay the costs of settlement and damage awards against officers and directors pursuant to these indemnification provisions.
+
+ 
+
+We
+believe that these provisions, the directors and officers liability insurance and the indemnity agreements are necessary
+to attract and retain talented and experienced officers and directors.
+
+ 
+
+ 115
+
+ 
+
+ 
+
+ 
+
+PRINCIPAL
+STOCKHOLDERS
+
+ 
+
+The
+following table sets forth information regarding the beneficial ownership of our common stock as of the date of this prospectus, and
+as adjusted to reflect the sale of our common stock included in the units offered by this prospectus, and assuming no purchase of units
+in this offering, by:
+
+ 
+
+ 
+ 
+ each
+ person known by us to be the beneficial owner of more than 5% of our outstanding shares of common stock;
+
+ 
+ 
+ 
+
+ 
+ 
+ each
+ of our executive officers, directors and director nominees that beneficially owns shares of our common stock; and
+
+ 
+ 
+ 
+
+ 
+ 
+ all
+ our executive officers, directors and director nominees as a group.
+
+ 
+
+Unless
+otherwise indicated, we believe that all persons named in the table have sole voting and investment power with respect to all shares
+of common stock beneficially owned by them. The following table does not reflect record or beneficial ownership of the placement warrants
+as these warrants are not exercisable within 60 days of the date of this prospectus.
+
+ 
+
+On
+March 15, 2021, our sponsor purchased 2,875,000 founder shares (Class B shares) for an aggregate purchase price of $25,000, or approximately
+$0.01 per share. On November 19, 2021, the Company cancelled 718,750 founder shares due to a downsize of the offering, resulting in an
+aggregate of 2,156,250 founder shares of Class B common stock issued and outstanding. On March 15, 2021, our sponsor transferred 20,000
+founder shares each to our Chief Executive Officer and Chief Operating Officer, as well as 2,500 founder shares to each of our
+Chief Scientific Officer and scientific advisor. On October 27, 2021, our sponsor transferred 10,000 founder shares to our Chief
+Executive Officer, 17,500 founder shares to our Chief Scientific Officer, 30,000 founder shares to each of our two independent directors,
+25,000 founder shares to each of our two independent directors, 15,000 founder shares to our strategic and scientific advisor and 5,500
+founder shares to our scientific advisor. In addition, our sponsor has committed, pursuant to a written agreement, to purchase an aggregate
+of 346,394 placement units for a purchase price of $10.00 per unit in a private placement that will occur simultaneously with the closing
+of this offering (assuming the underwriters do not exercise their over-allotment option). The following table presents the number of
+shares and percentage of our common stock beneficially owned as of the filing date, before and after this offering, by each person, or
+group of persons, known to us who beneficially owns more than 5% of our capital stock, each named executive officer, each of our directors
+and all directors and executive officers as a group. The post-offering numbers and percentages presented assume that the underwriters
+do not exercise their over-allotment option, that our sponsor forfeits 281,250 founder shares on a pro rata basis, and that there are
+9,758,894 shares of our common stock issued and outstanding after this offering, consisting of (i) 7,883,894 shares
+of our Class A common stock (including 7,500,000 public shares, 346,394 placement shares and 37,500 representative shares) and
+(ii) 1,875,000 shares of our Class B common stock, issued and outstanding after this offering.
+
+ 
+
+ 
+ 
+ Before
+ Offering 
+ After Offering
+
+ 
+ Name
+ and Address of Beneficial Owner(1) 
+ Number
+ of Shares Beneficially Owned(2) 
+ Approximate Percentage of Outstanding
+ Common Stock 
+ Number
+ of Shares Beneficially Owned(2) 
+ Approximate Percentage of Outstanding
+ Common Stock
+
+ 
+ Genesis Unicorn
+ Capital, LLC(1) 
+ 1,953,250 
+ 90.59% 
+ 2,018,394 
+ 20.68%
+
+ 
+ Adeoye Olukotun 
+ 30,000 
+ 1.39% 
+ 30,000 
+ *
+
+ 
+ Niel Starksen 
+ 20,000
+ 
+ * 
+ 20,000
+ 
+ * 
+
+ 
+ Samuel Lui 
+ 1,953,250 
+ 90.59% 
+ 2,018,394 
+ 
+ 20.68%
+
+ 
+ Juan Fernandez Pascual(3) 
+ 20,000 
+ * 
+ 20,000 
+ *
+
+ 
+ Grainne Coen 
+ 30,000 
+ 1.39% 
+ 30,000 
+ *
+
+ 
+ Ernest Fong 
+ 30,000 
+ 1.39% 
+ 30,000 
+ *
+
+ 
+ Chung Fan Cheng 
+ 25,000 
+ 1.16% 
+ 25,000 
+ *
+
+ 
+ Teck -Yong Heng 
+ 25,000 
+ 1.16% 
+ 25,000 
+ *
+
+ 
+ All executive officers and directors as a group (eight individuals) 
+ 2,133,250 
+ 98.93% 
+ 2,198,394 
+ 22.53%
+
+ 
+ Robert Chang, MD 
+ 8,000
+ 
+ * 
+ 8,000 
+ * 
+
+ 
+ Hank Wuh, MD 
+ 15,000 
+ * 
+ 15,000 
+ * 
+
+ 
+
+ 
+
+ *
+ Less
+ than 1%
+
+ 
+ 
+
+ (1)
+ Genesis
+ Unicorn Capital, LLC, our sponsor, is the record holder of the securities reported herein. Samuel Lui, is the sole member and manager
+ of our sponsor. By virtue of this relationship, Samuel Lui, our chief financial officer and a director, may be deemed to share
+ beneficial ownership of the securities held of record by our sponsor. The business address of each of these entities and individuals
+ is 281 Witherspoon Street, Princeton, New Jersey, 08540.
+
+ 
+
+ 116
+
+ 
+
+ 
+
+ 
+
+ (2)
+ Interests
+ shown consist solely of founder shares, classified as shares of Class B common stock, as well as placement shares after this offering
+ (assumes the underwriters over-allotment option has not been exercised, and an aggregate of 281,250 founder shares have been
+ forfeited by our sponsor). Founder shares are convertible into shares of
+ Class A common stock on a one-for-one basis, subject to adjustment, as described in the section of this prospectus entitled "Description
+ of Securities."
+
+ 
+ 
+
+ (3) 
+ Excludes an aggregate of 30,000 founder shares presently
+ held by our sponsor which our sponsor has contractually agreed (in a separate agreement with Mr. Pascual) to transfer to Mr. Pascual
+ at the time of our business combination. 
+
+ 
+
+Our
+two advisors own an aggregate of 23,000 Class B shares which were transferred by our Sponsor to them. After giving effect to the issuance
+of founder shares and the sale of the placement units, our initial stockholders (Sponsor, directors and advisors) will own approximately
+22.8% of the outstanding common stock following the offering (including the placement shares to be issued to the sponsor and assuming
+they do not purchase any units in this offering or the public market). Because of this ownership block, our initial stockholders and
+the holders of placement shares will have significant influence over the outcome of all matters requiring approval by our stockholders,
+including the election of directors, amendments to our amended and restated certificate of incorporation and approval of significant
+corporate transactions other than approval of our initial business combination. If we increase or decrease the size of the offering,
+we will effect a stock dividend or a share contribution back to capital, or other appropriate mechanism, as applicable, with respect
+to our Class B common stock immediately prior to the consummation of the offering in such amount as to maintain the ownership of our
+initial stockholders at 20% of the issued and outstanding shares of our common stock (excluding the placement units and the securities
+underlying and assuming they do not purchase any units in this offering) upon the consummation of this offering. The initial stockholders
+have agreed (A) to vote any shares owned by them in favor of any proposed initial business combination and (B) not to redeem any shares
+in connection with a stockholder vote to approve a proposed initial business combination.
+
+ 
+
+Our
+sponsor, executive officers and directors and advisors are deemed to be our "promoters" as such term is defined under
+the federal securities laws.
+
+ 
+
+Restrictions
+on Transfers of Founder Shares and Placement Units
+
+ 
+
+The
+founder shares, and placement units, and securities contained therein, are each subject to transfer restrictions pursuant to lock-up
+provisions in a letter agreement with us to be entered into by our sponsor, officers and directors. Those lock-up provisions provide
+that such securities are not transferable or salable (i) in the case of the founder shares (or shares of common stock issuable upon conversion
+thereof), until the earlier to occur of: (A) one year after the completion of our initial business combination and (B) subsequent to
+our initial business combination, if the reported last sale price of our Class A common stock equals or exceeds $12.00 per share (as
+adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading
+day period commencing after our initial business combination. In the case of the placement units, including the component securities
+therein, until 30 days after the completion of our initial business combination, except in each case (a) to our officers or directors,
+any affiliates or family members of any of our officers or directors, any members of our sponsor, or any affiliates of our sponsor, (b)
+in the case of an individual, by gift to a member of one of the members of the individual s immediate family or to a trust, the
+beneficiary of which is a member of one of the individual s immediate family, an affiliate of such person or to a charitable organization;
+(c) in the case of an individual, by virtue of laws of descent and distribution upon death of any of our officers, our directors, the
+initial stockholders or members of our sponsor; (d) in the case of an individual, pursuant to a qualified domestic relations order; (e)
+by private sales or transfers made in connection with the consummation of an initial business combination at prices no greater than the
+price at which the securities were originally purchased; (f) in the event of our liquidation prior to the completion of our initial business
+combination; (g) by virtue of the laws of Delaware or our sponsor s limited liability company agreement upon dissolution of our
+sponsor; or (h) in the event of our liquidation, merger, capital stock exchange, reorganization or other similar transaction which results
+in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property subsequent
+to our completion of our initial business combination; provided, however, that in the case of clauses (a) through (e) or (g) these permitted
+transferees must enter into a written agreement agreeing to be bound by these transfer restrictions and the other restrictions contained
+in the letter agreements and by the same agreements entered into by our sponsor with respect to such securities (including provisions
+relating to voting, the trust account and liquidating distributions described elsewhere in this prospectus).
+
+ 
+
+Registration
+Rights
+
+ 
+
+The
+holders of the founder shares, placement units (including securities contained therein) and units (including securities contained therein)
+that may be issued upon conversion of working capital loans, and any shares of Class A common stock issuable upon the exercise of the
+placement warrants and any shares of Class A common stock, warrants (and underlying Class A common stock) that may be issued upon conversion
+of the units issued as part of the working capital loans and Class A common stock issuable upon conversion of the founder shares, will
+be entitled to registration rights pursuant to a registration rights agreement to be signed prior to or on the effective date of this
+offering, requiring us to register such securities for resale (in the case of the founder shares, only after conversion to our Class
+A common stock). The holders of the majority of these securities are entitled to make up to three demands, excluding short form demands,
+that we register such securities. In addition, the holders have certain "piggy-back" registration rights with respect to
+registration statements filed subsequent to our completion of our initial business combination and rights to require us to register for
+resale such securities pursuant to Rule 415 under the Securities Act. The registration rights agreement does not contain liquidated damages
+or other cash settlement provisions resulting from delays in registering our securities. We will bear the expenses incurred in connection
+with the filing of any such registration statements.
+
+ 
+
+ 117
+
+ 
+
+ 
+
+ 
+
+CERTAIN
+RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
+
+ 
+
+On
+March 15, 2021, we issued an aggregate of 2,875,000 founder shares to our sponsor for an aggregate purchase price of $25,000 in cash,
+or approximately $0.01 per share. On November 19, 2021, the Company cancelled 718,750 founder shares due to a downsize of the offering,
+resulting in an aggregate of 2,156,250 founder shares of Class B common stock issued and outstanding. The number of founder shares issued
+was determined based on the expectation that such founder shares would represent 20% of the outstanding shares upon completion of this
+offering (excluding the placement units and underlying securities). On March 15, 2021, our sponsor transferred 20,000 founder
+shares to each of our Chief Executive Officer and Chief Operating Officer, and 2,500 founder shares to each of our Chief
+Scientific Officer and Scientific Advisor. On October 27, our sponsor transferred 17,500 founder shares to our Chief Scientific Officer,
+10,000 founder shares to our Chief Executive Officer, 30,000 founder shares to each of our two independent directors, 25,000 founder
+shares to each of our other two independent directors, 5,500 founder shares to our Scientific Advisor, and 15,000 founder shares to our
+Strategic and Scientific Advisor. If we increase
+or decrease the size of the offering we will effect a stock dividend or a share contribution back to capital or other appropriate mechanism,
+as applicable, with respect to our Class B common stock immediately prior to the consummation of the offering in such amount as to maintain
+the ownership of our initial stockholders at 20% of the issued and outstanding shares of our common stock (excluding the placement units
+and the underlying securities and assuming they do not purchase any units in this offering) upon the consummation of this offering. Up
+to 281,250 founder shares held by our sponsor are subject to forfeiture by our sponsor depending on the extent to which the underwriters 
+over-allotment option is exercised. The founder shares (including the Class A common stock issuable upon exercise thereof) may not, subject
+to certain limited exceptions, be transferred, assigned or sold by the holder. In addition, our sponsor has separately agreed to transfer
+to our Chief Operating Officer an aggregate of 30,000 of its founder shares at the time of our business combination. 
+
+ 
+
+Our sponsor has agreed to
+purchase an aggregate of 346,394 placement units at a price of $10.00 per unit for an aggregate purchase price of $3,463,935. If the
+over-allotment option is exercised in full, the amount of placement units sold will be 377,331 for an aggregate purchase price of $3,773,310.
+There will be no redemption rights or liquidating distributions from the trust account with respect to the founder shares, placement
+shares or placement warrants, which will expire worthless if we do not complete an initial business combination within 12 months from
+the closing of this offering (or up to 18 months from the closing of this offering if extended as described elsewhere in this
+prospectus).
+
+ 
+
+Commencing on the date of this
+prospectus, we have agreed to pay Genesis Unicorn Capital, LLC, our sponsor, a total of $10,000 per month for office space, utilities
+and secretarial and administrative support. Upon completion of our initial business combination or our liquidation, we will cease paying
+these monthly fees. 
+
+No
+compensation of any kind, including any finder s fee, reimbursement, consulting fee or monies in respect of any payment of a loan,
+will be paid by us to our sponsor, officers or directors or any affiliate of our sponsor, officers or directors prior to, or in connection
+with any services rendered in order to effectuate, the consummation of an initial business combination (regardless of the type of transaction
+that it is). However, these individuals will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our
+behalf such as identifying potential target businesses and performing due diligence on suitable business combinations. Our audit committee
+will review on a quarterly basis all payments that were made to our sponsor, officers, directors or our or their affiliates and will
+determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling on the reimbursement of out-of-pocket
+expenses incurred by such persons in connection with activities on our behalf.
+
+ 
+
+Prior
+to the closing of this offering, our sponsor has agreed to loan us up to $300,000 to be used for a portion of the expenses of this offering.
+These loans are non-interest bearing, unsecured and pursuant to that certain Amended and Restated Promissory Note dated as of February
+4, 2022, are due at the earlier of March 31, 2022 or the closing of this offering. The loan will be repaid upon the closing of this
+offering out of the estimated $451,435 of offering proceeds that has been allocated to the payment of offering expenses (other than underwriting
+commissions). The value of our sponsor s interest in this transaction corresponds to the principal amount outstanding under any
+such loan. As of September 30, 2021, $108,978 was outstanding under the Promissory Note.
+
+ 
+
+In
+addition, in order to finance transaction costs in connection with an intended initial business combination, our sponsor or an
+affiliate of our sponsor or certain of our officers and directors may, but are not obligated to, loan us funds on a non-interest
+bearing basis as may be required, beyond the initial $300,000 to be loaned by our sponsor. If we complete an initial business
+combination, we would repay such loaned amounts. In the event that the initial business combination does not close, we may use
+a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust account
+would be used for such repayment. Up to $1,500,000 of such loans may be convertible into units, at a price of $10.00 per unit
+at the option of the lender, upon consummation of our initial business combination. The units would be identical to the placement
+units. Other than as described above, the terms of such loans by our officers and directors, if any, have not been determined
+and no written agreements exist with respect to such loans.
+
+ 
+
+ 118
+
+ 
+
+ 
+
+ 
+
+We
+do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not believe third parties will
+be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our trust account.
+
+ 
+
+After
+our initial business combination, members of our management team who remain with us may be paid consulting, management or other fees
+from the combined company with any and all amounts being fully disclosed to our stockholders, to the extent then known, in the tender
+offer or proxy solicitation materials, as applicable, furnished to our stockholders. It is unlikely the amount of such compensation will
+be known at the time of distribution of such tender offer materials or at the time of a stockholder meeting held to consider our initial
+business combination, as applicable, as it will be up to the directors of the post-combination business to determine executive and director
+compensation.
+
+ 
+
+The
+holders of the founder shares, placement units, and units that may be issued upon conversion of working capital loans (and in each case
+holders of their component securities, as applicable) will have registration rights to require us to register a sale of any of our securities
+held by them pursuant to a registration rights agreement to be signed prior to or on the effective date of this offering. These holders
+will be entitled to make up to three demands, excluding short form registration demands, that we register such securities for sale under
+the Securities Act. In addition, these holders will have "piggy-back" registration rights to include their securities in
+other registration statements filed by us.
+
+ 
+
+We
+will enter into agreements with our officers and directors to provide contractual indemnification in addition to the indemnification
+provided for in our amended and restated certificate of incorporation. Our bylaws also will permit us to secure insurance on behalf of
+any officer, director or employee for any liability arising out of his or her actions, regardless of whether Delaware law would permit
+such indemnification. We will purchase a policy of directors and officers liability insurance that insures our officers
+and directors against the cost of defense, settlement or payment of a judgment in some circumstances and insures us against our obligations
+to indemnify our officers and directors.
+
+ 
+
+Related
+Party Policy
+
+ 
+
+We
+have not yet adopted a formal policy for the review, approval or ratification of related party transactions. Accordingly, the transactions
+discussed above were not reviewed, approved or ratified in accordance with any such policy.
+
+ 
+
+Prior
+to the consummation of this offering, we will adopt a code of ethics requiring us to avoid, wherever possible, all conflicts of interests,
+except under guidelines or resolutions approved by our board of directors (or the appropriate committee of our board) or as disclosed
+in our public filings with the SEC. Under our code of ethics, conflict of interest situations will include any financial transaction,
+arrangement or relationship (including any indebtedness or guarantee of indebtedness) involving the company. A form of the code of ethics
+that we plan to adopt prior to the consummation of this offering is filed as an exhibit to the registration statement of which this prospectus
+is a part.
+
+ 
+
+In
+addition, our audit committee, pursuant to a written charter that we will adopt prior to the consummation of this offering, will be responsible
+for reviewing and approving related party transactions to the extent that we enter into such transactions. An affirmative vote of a majority
+of the members of the audit committee present at a meeting at which a quorum is present will be required in order to approve a related
+party transaction. A majority of the members of the entire audit committee will constitute a quorum. Without a meeting, the unanimous
+written consent of all of the members of the audit committee will be required to approve a related party transaction. A form of the audit
+committee charter that we plan to adopt prior to the consummation of this offering is filed as an exhibit to the registration statement
+of which this prospectus is a part. We also require each of our directors and executive officers to complete a directors and officers 
+questionnaire that elicits information about related party transactions.
+
+ 
+
+These
+procedures are intended to determine whether any such related party transaction impairs the independence of a director or presents a
+conflict of interest on the part of a director, employee or officer.
+
+ 
+
+ 119
+
+ 
+
+ 
+
+ 
+
+To
+further minimize conflicts of interest, we have agreed not to consummate an initial business combination with an entity that is affiliated
+with any of our sponsor, officers or directors unless we, or a committee of independent directors, have obtained an opinion from an independent
+investment banking firm or another independent entity that commonly renders valuation opinions that our initial business combination
+is fair to our company from a financial point of view. Furthermore, no finder s fees, reimbursements, consulting fee, monies in
+respect of any payment of a loan or other compensation will be paid by us to our sponsor, officers or directors or any affiliate of our
+sponsor, officers or directors prior to, for services rendered to us prior to, or in connection with any services rendered in order to
+effectuate, the consummation of our initial business combination (regardless of the type of transaction that it is). However, the following
+payments will be made to our sponsor, officers or directors, or our or their affiliates, none of which will be made from the proceeds
+of this offering held in the trust account prior to the completion of our initial business combination:
+
+ 
+
+ 
+ 
+ Repayment
+ of up to an aggregate of $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses;
+
+ 
+ 
+ 
+
+ 
+ 
+ Payment
+ to Genesis Unicorn Capital, LLC, our sponsor, of $10,000 per month, for up to 18 months, for office space, utilities and secretarial
+ and administrative support;
+
+ 
+ 
+ 
+
+ 
+ 
+ Reimbursement
+ for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; and
+
+ 
+ 
+ 
+
+ 
+ 
+ Repayment
+ of non-interest bearing loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors
+ to finance transaction costs in connection with an intended initial business combination, the terms of which (other than as described
+ above) have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans
+ (including any loans or amounts due our sponsor in connection with the $10,000 monthly administrative fee) may be convertible
+ into units, at a price of $10.00 per unit at the option of the lender, upon consummation of our initial business combination. The
+ units would be identical to the placement units.
+
+ 
+
+Our
+audit committee will review on a quarterly basis all payments that were made to our sponsor, officers, directors or our or their affiliates.
+
+ 
+
+ 120
+
+ 
+
+ 
+
+ 
+
+DESCRIPTION
+OF SECURITIES
+
+ 
+
+Pursuant
+to our amended and restated certificate of incorporation, our authorized capital stock will consist of 125,000,000 shares of Class A
+common stock, $0.0001 par value, 12,500,000 shares of Class B common stock, $0.0001 par value, and 1,250,000 shares of undesignated
+preferred stock, $0.0001 par value. The following description summarizes the material terms of our capital stock. Because it is only
+a
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001853267_unsdg_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001853267_unsdg_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..47e0ce9c5db269c1eccc3b37d6ca9fb747b8ae12
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001853267_unsdg_prospectus_summary.txt
@@ -0,0 +1 @@
+summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled "Risk Factors" and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: "common stock" are to our Class A common stock and Class B common stock; "founder shares" are to shares of our Class B common stock initially purchased by our sponsor in a private placement prior to this offering, and the shares of our Class A common stock issuable upon the conversion thereof as provided herein; "initial stockholders" are to our sponsor and any other holders of our founder shares prior to this offering (or their permitted transferees); "management" or our "management team" are to our officers and directors; "private placement units" are to the units being purchased by our sponsor in the private placement, each placement unit consisting of one private placement share and one-half of one private placement warrant that are being purchased by our sponsor in the private placement; "private placement" are to the private placement of 575,000 private placement units (up to 635,000 private placement units if the underwriters over-allotment option is exercised in full) at a price of $10.00 per unit, for an aggregate purchase price of $5,750,000 (up to $6,350,000 if the underwriters over-allotment option is exercised in full), which will occur simultaneously with the completion of this offering; "private placement shares" are to the shares of common stock included within the private placement units being purchased by our sponsor in the private placement; "private placement warrants" are to the warrants included within the private placement units being purchased by our sponsor in the private placement; "public shares" are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); "public stockholders" are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder s and member of our management team s status as a "public stockholder" shall only exist with respect to such public shares; "public warrants" are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market, including warrants that may be acquired by our sponsor or its affiliates in this offering or thereafter in the open market); "related companies" are to ICO Capital Management Pte Ltd ("ICM"), Focus Ventures, C.M. Capital Corporation ("CM Capital"), Corigin Solutions, LLC, Vaultex Pte. Ltd. ("Vaultex"), Meraki Partners, LLC ("Meraki Partners"), Faber Plantae LLC and their subsidiaries and certain other entities with an executive management team that may from time to time include one or more members of our management team; "representative" are to EF Hutton, division of Benchmark Investments, LLC, which is the representative of the several underwriters in this offering; "sponsor" are to UNSDG Acquisition LLC, a Delaware limited liability company; "underwriters" are to the several underwriters of this offering, for which the representative is acting as representative; "warrants" are to our redeemable warrants, which includes the public warrants as well as the warrants included in the private placement units; and "we," "us," "our" or "Company" are to UNSDG Acquisition Corp.. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. 1 Table of Contents General We are a newly-organized blank check company incorporated in February 2021 as a Delaware corporation whose business purpose is to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business combination. To date, our efforts have been limited to organizational activities as well as activities related to this offering. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. While we may pursue an initial business combination opportunity in any business, industry, sector or geographical location, we intend to focus on decarbonization, sustainable mining, renewable energy, real estate and property management, blockchain, commodity trade sectors and the technologies with applications in those sectors. We will not undertake our initial business combination with any entity with its principal business operations in China (including Hong Kong). Our management team has broad and extensive multinational experience and success as lead investors, entrepreneurs and deal makers. From this combined experience our team brings a deep knowledge of the economics and technological intricacies across a wide range of industries. In addition, our management team and board have wide ranging business networks throughout many industries and ecosystems including, but not limited to finance, banking, real estate, blockchain, commodities, technology, energy, and manufacturing. Our Management Team Our management team is led by James Boettcher, our Chairman, Jeffrey Premer, our Chief Executive Officer, and Joel Arberman, our Chief Financial Officer. We believe our management team is well positioned to take advantage of the growing set of acquisition opportunities focused on technology and that our contacts and relationships, ranging from owners and management teams of private and public companies, private equity funds, investment bankers, attorneys, accountants and business brokers will allow us to generate an attractive transaction for our stockholders. We have also assembled a group of independent directors who will provide public company governance, executive leadership, operational oversight, private equity investment management and capital markets experience. Our board members have extensive experience, having served as directors or officers for numerous publicly-listed and privately-owned companies. Our directors have experience with acquisitions, divestitures and corporate strategy and implementation, which we believe will significantly benefit us as we evaluate potential acquisition or merger candidates as well as following the completion of our initial business combination James Boettcher has served as Chairman and Director since February 2021. He is currently a co-founder and Managing Director of Anthropocene Ventures, a seed stage fund based in San Francisco whose mission is to make deep-tech investments in technologies that will fight climate change and increase the resiliency of both the planet and mankind. Mr. Boettcher has over 25 years of venture capital experience, having founded Focus Ventures in 1996. While at Focus Ventures, he has led successful investments in many companies and helped guide them through acquisition by larger entities. Some of these companies include (with the subsequent acquirer shown in parentheses) 3VR, a video security company (now Identiv), Apigee (APIX), Cosine Communications (COSN), Crossbeam (Thoma Bravo), Cyan Optics (CYN), Equallogic (Dell), Infoblox (BLOX), Marin Software (MIRN), MuDynamics (Spirent), PA Semi (Apple), Pivot3 (S3), Pure Digital (Cisco), Starent Networks (Cisco), Stoke (Mavenir Systems), Telera (Alcatel), Teknovus (Broadcom) and Netscaler (Citrix). He is currently responsible for Focus Ventures investments in Picarro as a board observer and is on the board of PCH International in San Francisco and Shenzhen, China. Picarro, based in Silicon Valley and co-founded by Benchmark and Greylock venture capital firms, is the world s leading cavity ring down gas spectroscopy company. Its equipment provides high precision parts per billion accuracy for applications requiring trace gas analysis such as environmental monitoring, emissions monitoring, greener automotive engine development, semiconductor fabs, cleanroom technology and bio-pharmaceutical process monitoring. Mr. Boettcher and Focus Ventures lead the Series D financing and he was instrumental in expanding its sales footprint in China. 2 Table of Contents Outside of Focus Ventures, Mr. Boettcher has led many successful investments including Alteon WebSystems (Juniper), ONI (Optical Networks Inc.), Deeptech, Hello Direct, US Filter (Vivendi), USA Waste (Waste Management Inc.) and Prism Radio Partners. Since September 1992 Mr. Boettcher has also served as a member of the Investment Advisory Committee at CM Capital, a large single family office based in Palo Alto and Hong Kong. At the request of CM Capital, Mr. Boettcher in 2006 co-founded and was Chairman of the Investment Committee of Mingly China Growth Funds with offices in five cities around China. Mr. Boettcher has also been a Director at ICM in Singapore since November 2018. Mr. Boettcher was Vice President - Special Projects from June 1996 to August 1997 at CM Capital. Prior to that Mr. Boettcher was co-founder and Managing Director of Amsterdam Pacific Corp (a joint-venture among ABN Amro Bank, The Fremont Group (Bechtel Family Office) and CITIC from Beijing) from April 1986 to May 1996. Mr. Boettcher served as Vice President, Specialized Finance Group at Crocker National Bank in San Francisco, Hong Kong and Jakarta from December 1980 to March 1986. From October 1976 to November 1980, Mr. Boettcher was Vice President, Project Finance Group at Bank of America, San Francisco and London. Mr. Boettcher is a Co-founder and on the Board of Directors of Corigin Solutions, LLC, a company that recycles ag-wastes into organic fertilizer and pesticides as well as biochar which increases fertility of the soils while sequestering 3 tons of C02 with each ton put into the soils or building materials, a Board Member of Berkeley Earth, Senior Advisor Hashkey Digital Assets Group, Hong Kong, and was on the Advisory Board of GSR Ventures Palo Alto/Beijing, a leading US/China venture fund managing over $5 billion. Mr. Boettcher was a First Lieutenant in the U.S. Air Force from October 1970 to May 1974, serving as part of the Global Technology Team at Whiteman Air Force Base in Kansas City Missouri and in Southeast Asia. Mr. Boettcher received a B.S. degree in electrical engineering at the University of Wisconsin and received an M.B.A. from Stanford University and was an Arjay Miller Scholar. He also received an M.A. from the Food Research Institute. Jeffrey Premer has served as our Chief Executive Officer and a member of our Board of Directors since February 2021. Mr. Premer is the Chief Executive Officer and a Director of Vaultex, a regulated security token and asset exchange based in Singapore, a position he has held since June, 2018. Mr. Premer founded ICM and has been serving as its Manager since January 2018. ICM is a Singapore-based private advisory firm and business development company. In addition to his roles at Vaultex and ICM, Mr. Premer co-founded Baryon, Inc. ("Baryon") in May 2015 and served as its President through November 2017. Baryon was a Delaware-based technology company startup with a focus on commercialization of disruptive energy efficiency technologies such as applications that leverage thermodynamic energy savings realized through the Maisotsenko Cycle. At Baryon, Mr. Premer led the signing of a 500MW build operate and transfer wind project in Myanmar, and other smaller solar and wind renewable energy projects throughout Southeast Asia. From August 2017 to May 2018, Mr. Premer served as the Chief Strategy Officer and advisor to the Chief Executive Officer of Isotropic Systems, a technology company developing the world s first commercial application of transformation optics for millimeter wave RF antennas. In September 2014 Mr. Premer founded Meson Partners Ltd ("Meson Partners") and served as a Director. Meson Partners is a telecom tower services provider that has installed thousands of telecom tower power systems across Myanmar. Meson also provides various operations, maintenance and managed services to telecom tower owners and operators across that country. From January 2011 to December 2012, Mr. Premer served as a founding director and Chief Financial Officer of Sky Fiber Inc., the first large scale contracted customer of O3B Networks, Ltd. From 2001 to 2008, Mr. Premer was the Chief Executive Officer and a Director of Diversitech Manufacturing in Hangzhou China, where he managed a complex supply chain network of over 300 suppliers manufacturing different products for export. From May 2005 to June 2007 Mr. Premer was President of Aeon Digital International Ltd, where he led a team of more than 30 software developers who developed embedded software utilizing the Microsoft Windows Media real time encoder on the Equator digital signal processor platform, and managed all aspects of supply chain and manufacturing for export. In 1993. Mr. Premer founded his first startup, Asia Specific Enterprises Ltd. in Taiwan where he served as Managing Director until September 2001. Mr. Premer studied Mandarin Chinese at National Chung Kung University in Taiwan. 3 Table of Contents Joel Arberman has served as our Chief Financial Officer since March 2021. Mr. Arberman also serves as the Managing Member of Meraki Partners since May 2019 and as Chief Executive Officer, Chief Financial Officer and Secretary of Meraki Acquisition One, Inc. (TSXV:MRKI.P) since August, 2021. Meraki Partners helps entrepreneurs take their companies public to complete acquisitions, recruit talent, and raise capital. Meraki Acquisition One, Inc. is a capital pool company. From January 1997 to May 2019, Mr. Arberman was a strategic advisor and management consultant to technology, healthcare, real estate and financial services businesses. From August 1995 to January 1997, Mr. Arberman served as the Technology Analyst and Partner of Yorkton Securities, Inc. based in Toronto, Canada. Mr. Arberman played a key role in winning financing engagements that raised more than $180 million for technology companies. From November 1994 to August 1995, Mr. Arberman served as an Equity Analyst for SunAmerica Asset Management Corporation. From July 1993 to November 1994, Mr. Arberman served as a Junior Analyst for First Investors Management Corporation. Mr. Arberman received a B.S. degree with a concentration in Finance and Marketing, and minor in Economics at State University of New York at Albany. Robert Fung joined us as an independent member of our Board of Directors in March 2021. Mr. Fung is the former founding chairman of the Toronto Waterfront Revitalization Corporation, a corporation established by the Government of Canada, the Province of Ontario and the City of Toronto to lead the $17 billion renewal of Toronto s waterfront. He is Chairman and Chief Executive Officer of Crystallex International Corporation, a Canadian-based publicly-traded company gold mining company. He is also Chair of Torngat Metals, Chair of the Globe Foundation of Canada and a Director of Sunwah International Limited. Mr. Fung has served as a member of the Board of Directors of a number of private, public and charitable organizations. He was a trustee of Mount Sinai Hospital, He has served as a member of the advisory body to Macquarie Capital Markets Canada Ltd. And as a Deputy Chair to Macquarie Canada s predecessor company. Mr. Fung was Deputy Chair of the Asia Pacific Foundation of Canada, Chair of Smart Toronto, a member of the Board of Directors of Export Development Canada, serving as Chair of a number of its committees, including its Audit Committee, an Advisory Board of Marsh Canada and Chair of Tonbridge Corporation. He was a member of the Prime Minister of Canada s Advisory Committee on Asia Pacific Economic Corporation, as well as a member of the Government of Canada s Department of Industry International Trade and Agriculture Team Canada Inc. Advisory Board, which provided advice to the Government of Canada in setting strategic direction and performance objectives for Canada s International Business Development. From 1980 to 1998, he was Vice-Chairman and a Director of Gordon Capital Corporation. He was a senior member of the team that built that company into one of Canada s most innovative independent investment dealers at the time, participating in many of Canada s largest corporate transactions. From 1998 to 2001 he was a Senior Partner at independent investment dealer Capital West. From 1967 to 1978, he was Vice-President and a Director of Dominion Securities Limited with responsibilities for its investment activities in Asia and the Middle East. He began his career in the investment industry in 1964 with Wood Gundy. Janie Fong joined us as an independent member of our Board of Directors in March 2021. From February 2007 to present, Ms. Fong has served as Managing Director for East West Bank, a wholly-owned subsidiary of East West Bancorp., Inc., a Nasdaq-listed bank holding company. In January 2000 Ms. Fong was appointed by the Governor of California to serve as the State of California s Chief Representative in China and Hong Kong SAR, responsible for overseeing and developing programs and initiatives designed to expand trade, investment, market access and government and diplomatic ties between China and California-based firms. From August 1996 to January 2000 Ms. Fong served as an attorney in the Business International Group of Bullivant Houser Bailey PC, which international team was formerly part of Gordon & Rees. From July 1994 to August 1996, Ms. Fong served at Russin & Vecchi, LLP, International Legal Counselors. Ms. Fong is an independent non-executive Director of Hon Kwok Land Investment Company (The Stock Exchange of Hong Kong Stock Code; 160). She is also on the Women s Leadership Board at the Harvard University Kennedy School of Government. 4 Table of Contents Ms. Fong obtained her Juris Doctor in May 1992 from Santa Clara University School of Law. Prior to that Ms. Fong attended Hong Kong University, Institute for International and Comparative Law. Ms. Fong received her Bachelor of Arts from the University of California Los Angeles (UCLA) in June 1988. Ali Khan joined us as an independent member of our Board of Directors in March 2021. From February 2015 to February 2020 Mr. Khan was an Advisor, Private Equity to the Chairman, Oil Minister, where he developed a private equity investment platform and fund for the Oil & Gas Holding Company of the Kingdom of Bahrain. Mr. Khan was Investment Director at ASMA Capital Partners Bahrain from September 2013 to February 2015, where he managed the US$2 billion IDB Infrastructure Fund II. The fund shareholders included the governments of Bahrain, Saudi Arabia, Brunei and the Islamic Development Bank. From May 2010 to August 2013, Mr. Khan served as Managing Director at Maybank MEACP / MEACP, a private equity fund manager focused on clean and renewable energy investments in South East Asia, where he was responsible for all operations, including establishing the fund, securing commitments from anchor investors, hiring the investment team, developing the project pipeline, investor relations, legal, compliance and finance. From July 1996 to April 2010, Mr. Khan was a Director at Key Investment Group. Mr. Khan received his Masters of Science in finance in 2000 and B.B.A. degree in international business in 1995, both from the George Washington University School of Business. The past performance of the members of our management team or their affiliates is not a guarantee that we will be able to identify a suitable candidate for our initial business combination or of success with respect to any business combination we may consummate. You should not rely on the historical record of the performance of our management team or any of its affiliates performance as indicative of our future performance. 5 Table of Contents Business Strategy Decarbonization, the digitalization of physical assets in all sectors, and digital currencies are all current market trends with future potential growth. We believe that the combination of the three trends represents a significant business opportunity. In order to achieve net-zero carbon dioxide emissions, it will take a significant decarbonization effort to transform the way we generate and store clean electricity, produce food and commodities, transport goods, and heat and cool our buildings in order to limit the amount of greenhouse gases released in the atmosphere. In the strictest sense, decarbonization means both removing the carbon dioxide from the process in all of the areas previously mentioned, but also, importantly, to drawdown the massive amounts of carbon dioxide in the atmosphere to both reuse and sequester. According to a 2017 United Nations Report following an international United Nations Climate Change Conference, blockchain technology can play a significant role towards the goal of net-zero carbon dioxide emissions by facilitating the trading of carbon assets and improving the tracking of greenhouse gases. According to "Building a Private Finance System for Net Zero" a November 2020 report published by Mark Carney, UN Special Envoy for Climate Action and Finance, the estimated total investment needed to enable a transition to net zero carbon dioxide emissions in the energy sector is $3.5 trillion a year, with as much as $135 billion per year for carbon capture and biofuel technology. In addition, it is estimated that additional funds will be needed for the research and development of new technologies. Global climate change and the Paris Climate Accord are also helping to create higher demands for certain metals which are used to build renewable energy infrastructure and products. For example, as electricity-fueled cars increase in proportion to gasoline-fueled cars, it is expected that the mining of cobalt and lithium, as well as other rare metals, will increase. Historically, mining activities have been damaging to the environment. However, to accomplish the decarbonization goal, without causing damage elsewhere, companies are starting deploy new technologies and innovative business models to achieve sustainable development in the mining sector and its support industries according to a 2016 MIT report "Mission 2016: The Future of Strategic Natural Resources." We believe that technology companies supplying and supporting such activities should also benefit from this expected growth. Blockchain and fintech technology companies have contributed to the digitalization of assets that could reshape the way commodities are extracted, transported, and traded from the mine field to the market. This digitalization provides people with the ability to electronically track, trade, and collateralize assets. In the short term, blockchain can help streamline payment and settlement processes, while in the long run it could have a disruptive impact on the whole market structure impacting the renewable energy sector. The central banks of many large countries are exploring the use of cryptocurrencies. China, the United States, and the European Union are the leaders in this race as they hold the resources, technology, and infrastructure. In many current and planned implementations, central banks are utilizing blockchain technology at the core of their system design. This comes at a time when blockchain initiatives are being undertaken by governments worldwide to store its citizens personal data on immutable digital ledgers. This trend is expected to continue as computing power increases and the cost of digitalization of the physical world decreases. The adoption of such central bank s digital currencies will drive significant distributed ledger technology innovation and development that will impact not only the finance industry but also other industries such as security, logistics, healthcare, consumer, and e-commerce. 6 Table of Contents According to a May 2020 report by Markets and Markets, regarding the status of the blockchain market, the global blockchain market size is expected to grow from USD $3.0 billion in 2020 to USD $39.7 billion by 2025, at a compound annual growth rate (CAGR) of 67.3% during the forecast period. We believe this market should have a direct positive impact on achieving sustainable development goals, enabling financial services access to billions of unbanked people worldwide. UNSDG Acquisition Corp. aims to tap into these markets and target merger candidates that are in good positions to grow rapidly and to provide positive environmental and social impacts compliant with the United Nation s Sustainable Development Goals in traditional industries, or in the new industries created and driven by those markets. The United Nations Sustainable Development Goals is a list of seventeen specific actions developed in 2015 to be taken in order to achieve sustainable growth of our planet. These goals include clean water and sanitation, affordable and clean energy, sustainable cities and communities, responsible consumption and production, climate action and appropriate use of our natural resources. We believe that decarbonization which is the reduction or elimination of carbon dioxide, is a critical component of achieving many of these goals. Accordingly, our company will seek to merge with companies broadly in the decarbonization sectors including: Companies with digital exchanges that will accelerate the monetization and value of carbon credits, as virtually every major enterprise will seek to offset its carbon footprint and meet its standard set forth in Science Based Targets, which are clearly-defined paths to reduce emissions in line with the Paris Agreement goals. Companies that enable carbon drawdown and sequestration by leveraging photosynthesis. Companies that limit greenhouse gas emissions from farming. Companies involved in real estate technology, commercial property management, REIT management, residential property management, and agricultural property management that contribute toward the sustainable development goals. Companies in the real estate industry that help lower the carbon footprint of commercial or residential properties. Companies in the business of agricultural real estate acquisition and conversion to sustainable agriculture. Companies in the sustainable agriculture management business. Companies providing technology for sustainable agriculture. Companies that acquire and make properties more sustainable and lower the carbon footprint, while increasing overall yield. Companies that produce renewable energy in the form of solar, wind, wave/tidal and hydroelectric, as well as companies with new energy storage technologies. Companies that emphasize greater decentralization where electricity is created everywhere and flows of power are bidirectional, as well as distributed generation, including micro-grids and heat pumps in buildings and cities. Companies that emphasize improvements in building electrification, including materials that are produced with less energy, improved insulation, improved air conditioning efficiency, controlled glass darkening that also generates electricity and similar products. Companies that produce electric vehicles, including trucks, buses, trains, airplanes and ships. Competitive Strengths The sourcing, valuation, diligence, and execution capabilities of our management team, our Chairman Mr. Boettcher and our CEO Mr. Premer will provide us with a significant pipeline of opportunities from which to evaluate and select a business that will benefit from our expertise. Our competitive advantages include: Decades of entrepreneurial company building, venture investing and creating value in the sectors that we will be targeting. This experience gives us the capability to first identify attractive potential opportunities, then perform knowledgeable and insightful due diligence on potential targets and to add significant value to accelerate success post investment. The sourcing network between our management team and board of directors spans globally among various industries. Our management team and board of directors have over 100 years of combined venture investing, entrepreneurial leadership and deal making experience. Our management team and board of directors have developed long-term trusted relationships with global entrepreneurs as well as seed and early-stage investors across the United States, Europe and Asia. Our team has founded or invested in over 100 private companies, building a global network and backing founders and executives who are now spread (after their company was acquired or went public) across hundreds of technology companies. 7 Table of Contents Our management team and board of directors decades of experience running startups and investing in private companies gives us advantages in evaluating a prospective target business. We expect to conduct an extensive due diligence review that may encompass, among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities and a review of financial and other information about the target and its industry. We also plan to utilize our management team s operational and capital planning experience. We believe that a more streamlined and transparent path to the public market will encourage private companies, in the technology industry in particular, to go public while allowing them to remain operationally focused on long-term value creation. Being a trusted investor to many companies historically and currently, managing relationships with past and existing executives, enables our management team to bypass the need for acquiring deal flow from third parties, and fast tracks discussions with senior executives and board members of target companies directly. As a result, public market investors can gain access to disruptive technology companies earlier and direct investment exposure to long-term technology themes with appropriate valuation and pricing. Our mission is to create value with a compelling alternative to a traditional public offering by identifying fast-growing, breakout technology companies with long-term growth potential, that are focused on managing their growth, and transition them into well-run public companies without suffering managerial and operational distractions associated with a traditional public offering. Given our management team s history, experience, relationships, leadership and track record, we are uniquely positioned to identify disruptive technology companies and provide such companies with an alternative to traditional late-stage growth equity financing while providing a path to liquidity for early-stage investors. Our management team has extensive experience in the targeted industries. They are serial entrepreneurs and have succeeded in founding, running, and developing a diversified portfolio of businesses covering several geographic areas. James Boettcher is a venture capitalist veteran. He was recently highlighted in the upper quartile of the AlwaysOn VC 100 List and was ranked #37 on the Forbes magazine 2011 list of the Top 100 Most Powerful Venture Capitalists. He was a founding partner of Focus Ventures. While at Focus Ventures, he has led successful investments including those noted above. He led Focus Ventures business development efforts for its U.S. portfolio companies in Asia. Value-added activities include recruiting, finding manufacturing as well as sales and marketing partners and establishing new or joint-venture Asian entities. He is a co-founder, a Venture Partner and is Chairman of the Investment Committee for the highly successful Beijing and Shanghai-based Mingly/Mingxin China Growth Fund (MCGF), one of China s leading private equity firms managing both U.S. dollar and RMB funds. For several years, he served as Chairman and CEO of a MCGF portfolio company, Oorja Protonics, the world s only large-scale direct methanol fuel cell ("DMFC") company. He was a cofounder in 1986 and was Managing Director of a successful investment banking boutique, Amsterdam Pacific Corporation (APC) along with the Fremont Group (a single family office for the Bechtel family), CITIC (Beijing) and ABN AMRO Bank. Mr. Boettcher has an Electrical Engineering degree from the University of Wisconsin and an MBA (as an Arjay Miller Scholar) and MA in development economics from Stanford University. 8 Table of Contents Jeffrey Premer has extensive experience in finance and capital planning, software and hardware development, supply chain management, telecom services, satellite and fixed line trunking infrastructure, active and passive mobile network rollouts and power plant infrastructure development. Mr. Premer also has deep knowledge of all aspects of running a startup, including financing, team building, enabling strategic alliances, marketing, enterprise scaling and investor relations. He has been serving as Chief Executive Officer and Director in a regulated security token and asset exchange based in Singapore. He has also founded ICM. In addition, Mr. Premer co-founded Baryon, a technology company startup with a focus on commercialization of disruptive energy efficiency technologies including leveraging thermodynamic energy savings realized through the Maisotsenko Cycle. Mr. Premer also served as the Chief Strategy Officer and advisor to the Chief Executive Officer for Isotropic Systems, a technology company developing the world s first commercial application of transformation optics for millimeter wave RF antennas. Prior to holding these roles, in May 2015, Mr. Premer served as a founding director and President of Baryon through November 2017. While at Baryon, Mr. Premer led the signing of a 500MW build, operate and transfer wind project in Myanmar, and other smaller renewable projects throughout Southeast Asia. Mr. Arberman has proven experience and expertise in investments, investment banking and valuation. He has been serving as the Managing Member of Meraki Partners helping entrepreneurs take their company public to complete acquisitions, recruit talent and raise capital. He has been a strategic advisor and management consultant to technology, healthcare, real estate and financial services businesses. He has also served as a Technology Analyst and Partner of an investment banking firm and an analyst for two asset management firms. Acquisition Criteria To align with our business acquisition strategy, we have identified the following criteria that we believe are pertinent to evaluate initial target companies. The following criteria may not be exhaustive, and we consider that each sole criterion alone cannot be the final decisive factor of the business combination. Meanwhile, we remain open to the possibility to combine with a target business that does not meet the below mentioned criteria: We will not undertake our initial business combination with any entity with its principal business operations in China (including Hong Kong). We are looking for a company that: has a strong and experienced management team that could bring experience, expertise, and resources to the combined company, or provide a platform to assemble an effective management team with a track record of driving growth and profitability; is a significant player in an industry set for considerable market share and growth from one of more of the markets listed above; provides a platform for add-on acquisitions, which will be an opportunity for our management team to deliver incremental shareholder value post-acquisition; has a leading or niche market position, which demonstrates advantages over other competitors and has strong barriers to entry for market newcomers. Sources of leading or advantageous factors can be, but not limited to patents, brands, customer reputation, or other intellectual property, unique technical expertise or personnel, innovative processes or proprietary sourcing and distribution resources; 9 Table of Contents is at an inflection point, such as requiring additional management expertise, and has the capability to accelerate growth and financial performance through differentiated business models with the addition of our operational, financial, transactional and legal expertise and networks; exhibits unrecognized value or other characteristics, desirable returns on capital, and a need for capital to achieve the company s growth strategy, that we believe have been misevaluated by the marketplace based on our analysis and due diligence review; can benefit from being a publicly traded company, with access to broader capital markets, to achieve the business growth strategy; will offer an attractive risk-adjusted return for our shareholders, potential upside from growth in the target business and an improved capital structure that will be weighed against any identified downside risks; and has a diversified customer base better positioned to endure economic downturns, changes in the industry landscape and evolving customer, supplier and competitor preferences. Initial Business Combination Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. We refer to this as the 80% fair market value test. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. 10 Table of Contents We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the prior owners of the target business, the target management team or stockholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the "Investment Company Act"). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% fair market value test. If the business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as our initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. To the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Definitions Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated certificate of incorporation are to our amended and restated certificate of incorporation to be in effect upon completion of this offering; anchor investor are to certain investment funds and accounts managed by Atalaya Capital Management LP; common stock are to our Class A common stock and Class B common stock; directors are to our current directors and our director nominees named in this prospectus; extension deposit are to an amount equal to $0.10 per public share (a total of $1,750,000, or $2,012,500 if the underwriters option to purchase additional units is exercised in full) that our sponsor may deposit into the trust account in order to exercise each 3-month extension option if we have not entered into a business combination agreement; extension option are to the option of our sponsor, (i) upon deposit of the extension deposit into the trust account if we have not entered into a business combination agreement or (ii) for no additional fee if we have entered into a business combination agreement, in each case, to cause us to extend the available time to consummate our initial business combination by three months. Our sponsor may exercise the extension option up to two times, allowing for up to an additional six months (for a total of 21 months) to complete a business combination; founders are to Transverse (as defined below) and Jeffrey Hayman; founder shares are to shares of our Class B common stock initially purchased by our sponsor in a private placement prior to this offering and our shares of Class A common stock that will be issued upon conversion thereof as provided herein; initial stockholders are to our sponsor and the other holders of our founder shares prior to this offering; letter agreement are to the letter agreement, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team are to our directors and officers; private placement warrants are to the warrants issued to each of our sponsor and BTIG, LLC in a private placement simultaneously with the closing of this offering; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our sponsor, directors and officers to the extent our sponsor, directors or officers purchase public shares, provided their status as a public stockholder shall only exist with respect to such public shares; sponsor are to Lakeview Founder Sponsor LLC, a Delaware limited liability company; Transverse are to Transverse Insurance Group, LLC, a Delaware limited liability company, and its affiliated entities, excluding our company and sponsor; warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); and TABLE OF CONTENTS The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED FEBRUARY 24, 2022 PRELIMINARY PROSPECTUS $175,000,000 Lakeview Acquisition Corporation 17,500,000 Units Lakeview Acquisition Corporation is a newly incorporated blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. While we may pursue an initial business combination target in any industry or geographic location (subject to certain limitations described in this prospectus), we intend to focus our search on target businesses in the insurance sector in the United States. We are an emerging growth company and smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves risks. See Risk Factors beginning on page 30. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Price to Public Underwriting Discounts and Commissions(1) Proceeds, Before Expenses, to Us Per Unit $ 10.00 $ 0.55 $ 9.45 Total $ 175,000,000 $ 9,625,000 $ 165,375,000 (1) Includes $0.35 per unit, or $6,125,000 (or up to $7,043,750 if the underwriter s over-allotment option is exercised in full) in the aggregate, payable to the underwriter for deferred underwriting commissions to be placed in a trust account located in the United States as described herein. Does not include certain fees and expenses payable to the underwriter in connection with this offering. See also Underwriting for a description of compensation and other items of value payable to the underwriter. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $177,625,000 or $204,268,750 million if the underwriter s over-allotment option is exercised in full ($10.15 per unit), will be deposited into a U.S.-based trust account at Bank of America, N.A. with Continental Stock Transfer & Trust Company acting as trustee. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, if any, the funds held in the trust account will not be released from the trust account until the earliest to occur of: (1) our completion of an initial business combination; (2) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months if our sponsor exercises its extension options) from the closing of this offering or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity; and (3) the redemption of our public shares if we have not completed an initial business combination within 15 months (or up to 21 months if our sponsor exercises its extension options) from the closing of this offering, subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. The underwriter is offering the units for sale on a firm commitment basis. Delivery of the units will be made on or about , 2022. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Sole Book-Running Manager BTIG The date of this prospectus is , 2022. (Prospectus cover continued on the following page.) TABLE OF CONTENTS we, us, our, our company or Lakeview are to Lakeview Acquisition Corporation, a Delaware corporation. Unless we tell you otherwise, the information in this prospectus assumes that the underwriter will not exercise its over-allotment option and the forfeiture by our sponsor of 656,250 founder shares. General Lakeview Acquisition Corporation is a newly incorporated blank check company formed for the purpose of effecting a merger, stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business combination. Our objective is to generate attractive and sustainable long-term returns for stockholders by identifying compelling opportunities and enhancing value through improving operational and financial performance once a business combination is made. Our Company Business Strategy and Investment Thesis Lakeview Acquisition Corporation will employ a segmented and differentiated acquisition strategy that leverages the insurance industry expertise of our sponsor, founders, board of directors, and management team, as well as their analytical, research, sourcing and acquisition experience. Lakeview will utilize our sponsor s, founders , board of director s and management s experience and networks in the insurance industry to identify acquisition opportunities that meet our key criteria: Quality management team; Strategically compelling target market and presence; Demonstrated financial performance, cash flow and growth; Opportunity for either organic growth or growth via acquisitions; and Ability to benefit from the support and experience of our board of directors and management. Lakeview s differentiated approach is based on partnership and support. Our Chief Executive Officer is a proven insurance industry executive and has years of experience supporting management teams as a director of a global multi-line insurer. Our board of directors possesses decades of hands-on management and public company board experience. Finally, our founder, Transverse is a hybrid fronting carrier whose business model is based on partnering with organizations to provide access to varied sources of insurance market distribution and underwriting capacity. With these combined perspectives, we believe Lakeview is uniquely positioned to source and execute a value creating transaction in a number of insurance industry segments, including: Distribution our extended team (management, board of directors, and founders) has relationships across the spectrum of insurance intermediaries and managing general agents ( MGAs ) as well as experience on the boards of both public and private brokerages. Distribution is a dynamic segment with many private businesses that could benefit from access to public capital markets from acquisition driven distribution aggregators to commercial insurance brokers, to focused distributors concentrating on specific target markets, such as high net worth individuals. Private Carriers Private equity owned or other privately owned insurers will have the opportunity to benefit from management and our board of directors perspective and experience across virtually every product line, market segment, distribution channel and underwriting platform. Insurance related products and services There are numerous products that fit together with insurance. These include warranty and accidental damage protection, where the service provider often aggregates its obligations and purchases coverage from an insurer to manage its own risk. Other examples include Travel Service and Assistance providers, involving a mixture of TABLE OF CONTENTS (Prospectus cover continued from preceding page.) This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one share of our Class A common stock and one-half of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as described in this prospectus, and only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. The warrants will become exercisable on the later of 30 days after the completion of our initial business combination and 12 months from the closing of this offering, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. Subject to the terms and conditions described in this prospectus, we may redeem the warrants once the warrants become exercisable. We have also granted the underwriter a 45-day option to purchase up to an additional 2,625,000 units to cover over-allotments, if any. We will provide our public stockholders with the opportunity to redeem all or a portion of their shares of our Class A common stock upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below calculated as of two business days prior to the completion of our initial business combination, including interest (less up to $100,000 of interest to pay dissolution expenses and which interest shall be net of taxes payable), divided by the number of then issued and outstanding shares of our Class A common stock that were sold as part of the units in this offering, which we refer to collectively as our public shares, subject to the limitations described herein. If we have not completed our initial business combination within 15 months (or up to 21 months if our sponsor exercises its extension options) from the closing of this offering, we will redeem 100% of the public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (less up to $100,000 of interest to pay dissolution expenses and which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares, subject to applicable law and as further described herein. To exercise each of its three-month extension options, our sponsor is required to make an extension deposit into the trust account in an amount equal to $0.10 per public share if at the time of such extension we have not entered into an executed letter of intent, agreement in principle or definitive agreement for our initial business combination (a business combination agreement ). Our sponsor, Lakeview Founder Sponsor LLC, a Delaware limited liability company (which we refer to as our sponsor throughout this prospectus) and the underwriters, have committed to purchase an aggregate of 9,375,000 warrants (or 10,293,750 warrants if the underwriter s over-allotment option is exercised in full) at a price of $1.00 per warrant ($9,375,000 in the aggregate or $10,293,750 in the aggregate if the underwriter s over-allotment option is exercised in full) in a private placement that will close simultaneously with the closing of this offering. Of these warrants, our sponsor has agreed to purchase 8,500,000 warrants (or 9,287,500 warrants if the underwriter s over-allotment option is exercised), the underwriters have agreed to purchase 875,000 warrants (or 1,006,250 warrants if the underwriter s over-allotment option is exercised). We refer to these warrants throughout this prospectus as the private placement warrants. Each private placement warrant entitles the holder thereof to purchase one share of Class A common stock at $11.50 per share, subject to adjustment as provided herein. Our initial stockholders currently hold 5,031,250 shares of our Class B common stock (which we refer to as founder shares as further described herein), up to 656,250 of which are subject to forfeiture by our sponsor depending on the extent to which the underwriter s over-allotment option is exercised. The shares of our Class B common stock will automatically convert into shares of Class A common stock at the time of our initial business combination, or earlier at the option of the holder, on a one-for-one basis, subject to adjustment as provided herein. In the case that additional shares of Class A common stock are issued or deemed issued in excess of the amounts issued in this offering and related to the closing of our initial business combination, except if such is the result of the conversion of shares of our Class B common stock, the ratio at which the shares of our Class B common stock will convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the issued and outstanding shares of Class B common stock agree to waive such anti-dilution adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, 20% of the sum of all shares of our Class A common stock issued and outstanding upon the completion of this offering, plus all shares of our Class A common stock issued or deemed issued (after giving effect to any redemptions of Class A common stock) in connection with our initial business combination, excluding any shares issued, or to be issued, to any seller in the business combination. Prior to our initial business combination, holders of our Class B common stock will have the right to elect all of our directors and may remove members of the board of directors for any reason. On any other matter submitted to a vote of our stockholders, holders of our Class B common stock and holders of our Class A common stock will vote together as a single class, except as required by law or applicable stock exchange rule. Certain investment funds and accounts managed by Atalaya Capital Management LP, which we refer to collectively as our anchor investor throughout this prospectus, have expressed to us an interest to purchase up to an aggregate of 9.9% of units offered in this offering. Because this expression of interest is not a binding agreement or commitment to purchase, there can be no assurance that the anchor investor will acquire any units in this offering or as to the amount of such units the anchor investor will retain, if any, prior to or upon the consummation of our initial business combination. For a discussion of certain additional arrangements with our anchor investor, see Summary The Offering Expression of Interest. Prior to this offering, there has been no public market for our units, Class A common stock or warrants. We intend to apply to list our units on the New York Stock Exchange (the NYSE ) under the symbol LKVA.U on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on the NYSE. The shares of Class A common stock and warrants constituting the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless BTIG, LLC informs us of its decision to allow earlier separate trading, subject to our issuing a press release announcing when such separate trading will begin. Once the securities constituting the units begin separate trading, we expect that the Class A common stock and warrants will be listed on the NYSE under the symbols LKVA and LKVA WS, respectively. TABLE OF CONTENTS insurance protection and non-insurance services. Finally, within the InsurTech sector described below there are innovative companies providing analytics, modeling, claims related and loss preventive applications. Run-off managers We believe there will be demand in this area of the market because insurers that want to exit underperforming lines of business may be willing to pay a premium above and beyond current reserves for certainty around their future liability. Run off companies exist across life and P&C insurance. InsurTechs These companies represent great innovation and growth potential. Many, if not most, require access to insurance licenses and capacity the very business model of our founder, Transverse. We believe our extended team has the ability to support and assist these firms in achieving their growth plans. Carve outs finally, our extended team has relationships and insight into a number of divisions that, if separated from their parents, have the potential to release value. Our board of directors and founders extensive experience in the M&A marketplace helps us offer a compelling value proposition here. In each of these target segments, where companies could benefit, a member of our team can join the board of directors of the acquired company. Lakeview s Competitive Strengths Industry Knowledge and Operating Experience Our extended team has managed and led insurance organizations domestically and globally for decades, across a wide range of lines of business, distribution channels, geographies and underwriting platforms. They also have extensive M&A, deal structuring and analytical experience and expertise. Sourcing, Network and Record of Management Support Our Chief Executive Officer and Chairman of our board of directors, Jeffrey Hayman, has nearly 40 years experience in the insurance industry, including most recently as a member of the Board of Directors of Zurich Insurance Group and Chair of their Risk & Investment Committee. Mr. Hayman also held executive positions with Travelers Insurance, American International Group, Inc. ( AIG ) and Starr International, notably as Chief Executive Officer Global Consumer Insurance with AIG (an SEC reporting segment) and previously as AIG s Chief Executive Officer for Japan & Korea P&C. He has since worked with private equity investors and advised and co-invested with private equity and hedge funds on capital deployment opportunities in the insurance industry. Mr. Hayman has a personal network of connections in the industry across distribution and (re)insurers. Nicholas Walsh, our director nominee, has been a leader in the insurance industry for decades and brings both public and private board experience in the insurance brokerage space. In his more than 40 years with AIG, Mr. Walsh was President and Chief Executive Officer of American International Underwriters, where he led the firm s European P&C business and its international network. Mr. Walsh was also Executive Vice President of AIG and was Vice Chairman of AIG s P&C business line where he managed AIG s distribution relationships. Thereafter, Mr. Walsh moved into a non-executive director role with JLT, and is currently with the private brokerage McGill & Partners Ltd. Mr. Walsh has a network of former colleagues and associates and a brand name in the industry. In addition to Messrs. Hayman s and Walsh s personal networks, our founder, Transverse, as a hybrid fronting carrier has relationships with the potential to introduce numerous distribution outlets, be they agencies, traditional brokerages, acquisition-oriented aggregators, MGAs and InsurTechs. Further, Transverse manages an InsurTech Venture Capital fund, giving them a keen perspective on developments in that segment. Together, Lakeview has access to a pipeline of insurance industry opportunities from which to evaluate and select a business that has the potential to benefit from our knowledge, experience, expertise, and from access to the public capital markets. TABLE OF CONTENTS Innovation, Diligence, Execution and Structuring Experience David Paulsson, our director nominee, is the co-founder and President of Transverse, a P&C program carrier backed by private equity, family office and state and corporate pension investors. Transverse is a leading player in the hybrid fronting space, partnering with MGAs and insurance specialists and connecting them to global reinsurers. Mr. Paulsson was formerly Portfolio Manager of Paragon Outcomes and managed a diversified portfolio of holdings across real assets, specialty finance and insurance investments. He has served on various investor advisory committees, including those of Dyal Capital Advisors, Fortress Transportation & Infrastructure, and Atalaya Asset Income Fund. Mr. Paulsson has over 17 years of principal investment experience and holds CFA and CAIA designations. Valuation, Leadership and Research Support Andrew J. Melnick, our director nominee, is a founding member and Chief Investment Strategist of SkyView Investment Advisors LLC. Mr. Melnick was also a Partner and Management Committee Member at Goldman Sachs. In that role, he co-led the Global Equity and Economic Research Department. Mr. Melnick was also Director of Global Securities & the Economic Research Division at Merrill Lynch. Under his leadership, Merrill Lynch earned the Institutional Investor Magazine award for the top US research firm for six consecutive years. Structuring and Deal Evaluation Experience Mari Somer Saour Hatano, our director nominee, has significant experience matching investors with investment opportunities, with a network of potential investors in Japan. She is the founder and managing partner of Soleil Global Advisors LLC, which specializes in bridging the Japanese and the global investment markets with offices in New York City and Tokyo, Japan. She has over 20 years experience in the alternative investment industry. Execution and Structuring Capabilities Our director nominee, Mr. Melnick, is a founding member and Chief Investment Strategist of SkyView. SkyView has a strong, research driven investment management team that manages in excess of $3.4 billion on a discretionary and non-discretionary basis. SkyView regularly partners with institutions to provide investment and research support to construct and deliver value-added, scalable solutions. In addition, our director nominee, Mr. Paulsson, as noted above, has 17 years of principal investment experience across a number of transactions in the insurance industry. Our Founder Transverse launched in 2018 serving as a P&C program carrier, partnering with reinsurers and program administrators to provide a broad range of property and casualty products for commercial and personal lines insurance. Transverse provides both admitted and non-admitted insurance solutions and adds significant value through its ability to retain risk and serve as an active partner in all functional areas of the insurance program cycle. Transverse was created to provide the resources and knowledge reinsurers, program administrators and other producers need to succeed. The Transverse team possesses a diverse background of technical skills including underwriting, product development, actuarial and financial analysis, compliance and claims administration. Its team has nearly 300 years of collective (re)insurance expertise, led by Erik Matson, Chairman & CEO, and David Paulsson, President & Chief Investment Officer. Erik Matson has 30 years of experience with global P&C (re)insurance carriers, including Munich Re, Allianz and AIG, prior to forming Transverse. David Paulsson has 17 years investing in alternatives, including insurance, and has served as a formal advisory board member with a number of investors, including DYAL Capital Partners, Fortress Investment Group and Melody Capital. Transverse creates solutions by bridging the gap between (re)insurer capacity partners and the top producers. Transverse serves to create new market opportunities by providing access to both (re)insurance companies and leading MGAs with varied risk appetites. Its ability to retain risk opens the full spectrum of traditional and non-traditional reinsurance solutions, and its team has deep and broad access to the most TABLE OF CONTENTS favorable domestic and international markets. Matching the ideal risk appetite to market opportunities produces true alignment and shared vision among all participants. Our Acquisition Process In evaluating a prospective target business, we expect to conduct an extensive due diligence review which may encompass, as applicable and among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities and a review of financial and other information about the target and its industry. Our search for a business combination, ability to consummate a business combination, or the operations of a target business with which we ultimately consummate a business combination, may be materially adversely affected by the recent COVID-19 outbreak. See Risk Factors Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the COVID-19 outbreak and the status of debt and equity markets. We are not prohibited from pursuing an initial business combination with a business that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a business that is affiliated with our sponsor, officers or directors, we, or a committee of independent and disinterested directors, will obtain an opinion from an independent investment banking firm or from an independent accounting firm that such initial business combination is fair to our company from a financial point of view. Each of our sponsor, directors and officers will, directly or indirectly, own founder shares and/or private placement warrants following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, such officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. Past experience or performance of Transverse or our sponsor, officers or directors and their respective affiliates is not a guarantee of either (1) our ability to successfully identify and execute a transaction or (2) success with respect to any business combination that we may consummate. You should not rely on the historical record of Transverse or our sponsor, officers or directors or their respective affiliates as indicative of future performance. See Risk Factors Past performance by Transverse or our sponsor or management team and their respective affiliates may not be indicative of future performance of an investment in the company. No member of our management team has any experience operating special purpose acquisition companies. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity subject to his or her fiduciary duties. As a result, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will need to honor such fiduciary or contractual obligations to present such business combination opportunity to such entity, before we can pursue such opportunity. If these other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. However, we do not expect these duties will materially affect our ability to complete our initial business combination. Our amended and restated certificate of incorporation will provide that we renounce our interest in any business combination opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company and it is an opportunity that we are able to complete on a reasonable basis. In addition, our sponsor and our officers and directors may sponsor, form, invest in or otherwise become involved with other special purpose acquisition companies similar to ours, including in connection TABLE OF CONTENTS with their initial business combination, or may pursue other business or investment ventures during the period in which we are seeking an initial business combination. Any such companies, businesses or investments may present additional conflicts of interest in pursuing an initial business combination. Our directors and officers are not required to commit any specified amount of time to our affairs, and, accordingly, will have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. See Risk Factors Each of our directors and officers are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented. Initial Business Combination The NYSE listing rules require that our initial business combination must be with one or more operating businesses or assets with a fair market value equal to at least 80% of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the income earned on the trust account). We refer to this as the 80% of fair market value test. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. Our stockholders may not be provided with a copy of such opinion and will not be able to rely on such opinion. Subject to this requirement, our management team will have virtually unrestricted flexibility in identifying and selecting one or more prospective businesses. We do not currently intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination, although there is no assurance that will be the case. We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the issued and outstanding equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our initial business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the issued and outstanding capital stock, shares or other equity securities of a target business or issue a substantial number of new shares to third-parties in connection with financing our initial business combination. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of fair market value test. If our initial business combination involves more than one target business, the 80% of fair market value test will be based on the aggregate value of all of the target businesses. Notwithstanding the foregoing, if we are not then listed on the NYSE for whatever reason, we would no longer be required to meet the foregoing 80% of fair market value test. Prior to the effectiveness of the registration statement of which this prospectus forms a part, we will file a Registration Statement on Form 8-A with the Securities and Exchange Commission (the SEC ) to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended (the Exchange Act ). As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. TABLE OF CONTENTS Corporate Information We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates equals or exceeds $700 million as of the end of that year s second fiscal quarter, and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates equals or exceeds $250 million as of the end of that year s second fiscal quarter, or (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates equals or exceeds $700 million as of the end of that year s second fiscal quarter. Our executive offices are located at 15 Independence Blvd, Suite 430, Warren, New Jersey 07059 and our telephone number is (609) 342-2088. Upon completion of this offering, our corporate website address will be www.lakeviewacquisitioncorp.com. Our website and the information contained on, or that can be accessed through, the website is not deemed to be incorporated by reference in, and is not considered part of, this prospectus or the registration statement of which this prospectus is a part. You should not rely on any such information in making your decision whether to invest in our securities.
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+SUMMARY
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+ This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing.
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+ Unless otherwise stated in this prospectus, or the context otherwise requires, references to:
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+ Adnant Distribution Time are to the time at which the Distributable Adnant Redeemable Warrants will be issued, which will occur immediately after the Initial Business Combination Redemption Time and immediately prior to the closing of our initial business combination;
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+ common stock are to our Class A Common Stock and our Class B Common Stock, collectively;
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+ director shares are to restricted shares of Class A Common Stock granted or to be granted to our directors, with an aggregate value equal to $60,000 per year based on the fair market value of our Class A Common Stock on the date of grant, which shall vest in 12 equal monthly installments beginning on the first anniversary of the date of grant and be fully vested upon the consummation of our initial business combination, subject to continued service on our board of directors until that date, which is described in more detail throughout this prospectus; 
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+ Distributable Adnant Redeemable Warrants are to the redeemable warrants which our public stockholders have a contingent right to receive, in certain circumstances described in this prospectus and pursuant to the contingent rights agreement, at the Adnant Distribution Time, with two-ninths of one Distributable Adnant Redeemable Warrant receivable per each public share not redeemed in connection with our initial business combination;
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+ Forward Purchase Agreement are to an agreement providing for the sale of our Forward Purchase Warrants to our sponsor in one or more private placements in such amounts and at such time or times as provided therein;
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+ Forward Purchase Securities are to the Forward Purchase Warrants and shares of Class A Common Stock underlying the Forward Purchase Warrants;
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+ Forward Purchase Warrants are to the warrants to be issued pursuant to the Forward Purchase Agreement, which will have identical terms to those of the Private Placement Warrants, except as described herein;
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+ Initial Business Combination Redemption Time are to the time at which we redeem shares of Class A Common Stock that the holders thereof have elected to redeem in connection with our initial business combination, which will occur prior to the consummation of our initial business combination; 
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+ initial stockholders are to our sponsor and any other holders of our sponsor shares prior to this offering (or their permitted transferees);
+
+ 
+ 
+ 
+
+ 
+ 
+ management or our management team are to our officers and directors;
+
+ 
+ 
+ 
+
+ 
+ 
+ Outstanding Redeemable Warrants are to the one-ninth of one redeemable warrants included as part of the units in this offering;
+
+ 
+ 
+ 
+
+ 
+ 
+ Post-Business Combination Warrants are to the aggregate 1,309,131 warrants that our sponsor may purchase pursuant to the Forward Purchase Agreement after the closing of our initial business combination;
+
+ 
+ 
+ 
+
+ 
+ 
+ Pre-Business Combination Warrants are to the aggregate 660,410 warrants that our sponsor may purchase pursuant to the Forward Purchase Agreement after the consummation of this offering and prior to the closing of our initial business combination;
+
+ 
+ 
+ 
+
+ 
+ 
+ Private Placement Warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering, which Private Placement Warrants are identical to our Outstanding Redeemable Warrants sold as part of the units in this offering, subject to certain limited exceptions as described in this prospectus;
+
+ 
+ 
+ 
+
+ 
+ 
+ public shares are to shares of our Class A Common Stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); 
+
+ 
+ 
+ 
+
+ 
+ 
+ public stockholders are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder and member of our management team s status as a public stockholder shall only exist with respect to such public shares;
+
+ 
+ 
+ 
+
+ 
+ 
+ public warrants are to our Outstanding Redeemable Warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market), and to the Distributable Adnant Redeemable Warrants issuable to the remaining holders of our outstanding shares of Class A Common Stock issued in this offering (after we redeem any shares of Class A Common Stock that the holders thereof have elected to redeem in connection with our initial business combination), and to the Private Placement Warrants if held by third parties other than our sponsor or the underwriters (or permitted transferees), in each case, following the consummation of our initial business combination, and, for the avoidance of doubt, the term public warrants does not include the Forward Purchase Warrants;
+
+ 
+ 
+ 
+
+ 
+ 
+ sponsor are to Adnant Concepcion Sponsor LLC, a Delaware limited liability company, an affiliate of Sabas Carrillo, our Chief Executive Officer and Chairman;
+
+ 
+ 
+ 
+
+ 
+ 
+ sponsor shares are to shares of our Class B Common Stock initially purchased by our sponsor in a private placement prior to this offering, and the shares of our Class A Common Stock issuable upon the conversion thereof as provided herein;
+
+ 
+ 
+ 
+
+ 
+ 
+ underwriter are to WestPark Capital, Inc. ( WestPark Capital ), the representative of the underwriters in this offering;
+
+ 
+ 
+ 
+
+ 
+ 
+ Underwriter Warrants are to the warrants to be issued to WestPark Capital at the closing of this offering and at the closing of our initial business combination;
+
+ 
+ 
+ 
+ 
+ warrants are to our warrants, which includes the public warrants as well as the Private Placement Warrants, the Forward Purchase Warrants, and the Underwriter Warrants; and
+
+ 
+ 
+ 
+
+ 
+ 
+ we, us, company or our company are to Adnant Concepcion Acquisition Corp.
+
+ 
+ 
+ 
+ Each unit consists of one share of Class A Common Stock, one-ninth of one Outstanding Redeemable Warrant (or 277,777 Outstanding Redeemable Warrants in the aggregate), and one contingent right to receive, in certain circumstances described in this prospectus and pursuant to the contingent rights agreement, at the Adnant Distribution Time, two-ninths of one Distributable Adnant Redeemable Warrant. Each whole warrant entitles the holder thereof to purchase one share of our Class A Common Stock at a price of $11.50 per share (other than the Underwriter Warrants, which have an exercise price of $12.00 per share), subject to adjustment as described in this prospectus. No fractional redeemable warrants will be issued upon the separation of our redeemable warrants or the issuance of the Distributable Adnant Redeemable Warrants other than as part of the units, no cash will be paid in lieu of fractional redeemable warrants and only whole redeemable warrants will trade. Accordingly, unless you purchase at least nine units, you will not be able to receive or trade a whole Outstanding Redeemable Warrant. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option.
+ 
+ 
+ 1
+ 
+
+ Table of Contents
+
+ 
+ 
+ 
+ Our Company
+ 
+ We are a blank check company formed under the laws of the State of Delaware on February 24, 2021. We were formed for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities, which we refer to as a target business. We may pursue a business combination opportunity in any business or industry we choose. To date, our efforts have been limited to organizational activities as well as activities related to this offering.
+ 
+ While our efforts to identify a target business may span many industries and regions worldwide, we intend to focus our search on companies in the cannabis industry with enterprise values that are greater than the net proceeds of this offering and the sale of the Private Placement Warrants. Potential areas of interest in the cannabis industry include but are not limited to domestic and international businesses that are ancillary to the production, distribution and sale of cannabis as well as businesses that legally cultivate, process, and/or retail cannabis. Our ability to locate a potential target is subject to the uncertainties discussed elsewhere in this prospectus.
+ 
+ Although the cannabis industry has evolved significantly and continues to mature, we believe the industry is still undercapitalized and companies operating across multiple verticals consistently have trouble accessing capital from traditional sources. Historically, businesses that operate within the legal cannabis industry in the U.S. have relied largely on private money friends and family, high net-worth individuals and small-to-medium-sized private investment firms as institutional investors have shied away from companies in the cannabis industry, especially those that are directly involved in the production, distribution, and retail sale of cannabis. Even businesses that do not touch the plant and instead provide ancillary services to the industry have found it extremely difficult to access large pools of institutional capital. As a result, we believe we have the opportunity to create a compelling structure that will enable a target company to go public, thereby accessing significant capital for both organic growth and for acquisitions of synergistic and often undercapitalized assets. Given the rapid growth of the legal cannabis market, management believes that the ability to move quickly to capitalize on new opportunities will be critical to success in creating stakeholder value.
+ 
+ None of our officers, directors, promoters and other affiliates has engaged in any substantive discussions on our behalf with representatives of other companies regarding the possibility of a potential business combination with us.
+ 
+ Our Management Team
+ 
+ Our management team and board of directors will consist of experienced deal makers, operators, and investors. Our Director, Chairman and Chief Executive Officer, Mr. Sabas Carrillo is the Founder and CEO of Adnant, LLC, an accounting and consulting firm focused on the cannabis industry with an expertise in advising companies on the go-public process. Mr. Carrillo has over 18 years of experience in accounting and over 12 years of experience working exclusively with start-ups, having helped found, grow, and lead companies through successful exits. He focuses on creating and taking public innovative companies with high growth potential. Mr. Carrillo is an SEC financial reporting expert with extensive experience in M&A work. He currently serves as Interim CFO for Cookies Creative Consulting & Promotions Inc., as Interim CEO of Unrivaled Brands, Inc. (OTCQX: UNRV) (formerly known as Terra Tech Corp.; OTCQX: TRTC), pursuant to an August 12, 2022 services agreement with that company (the August Service Agreement ), and was on the go-public team for Weedmaps and General Cannabis, Inc., a publicly traded company (OTCQB: CANN) from 2010 to 2012. In 2014, Mr. Carrillo led the team that took the first cannabis dispensary public, Bl m Oakland, on behalf of Terra Tech Corp. Mr. Carrillo is co-founder and CFO of two cannabis-focused funds: Mesh Ventures and 1212 Ventures. Among his advisory roles to companies and brands in the industry, Mr. Carrillo s client list includes MedMen, GlassHouse Group, Loudpack, GTI, NorCal Cannabis Company, Beboe, Acreage Holdings, Verano Holdings and Grass Lands (first cannabis licensed concessions at a venue). Passionate about working with non-profits such as Las Fotos Project, Downtown Women s Center, The Good Shepherd Center, and Brilliant Corners, Mr. Carrillo is also the founder of Alta Loma Group, LLC, a real estate holding company on a mission to provide quality affordable housing in South Central Los Angeles. Mr. Carrillo received his B.A. in Economics with a minor in computer programming from the University of California, Los Angeles.
+ 
+ We believe the expertise and experience of Mr. Carrillo in sourcing and creating unique opportunities as well as structuring complex transactions involving creative capital deployment, will make us a partner of choice for potential business combination targets. We intend to focus our efforts on evaluating business combination targets by leveraging the management team and board of directors deep network of public and private enterprises, experienced operators, restructuring advisors, attorneys, accountants, family offices, hedge funds, and private equity firms.
+ 
+ Patty Chan, our Director and Chief Financial Officer, has 14 years of experience in accounting, reporting, compliance and operations across the cannabis, real estate and financial services industries. Since joining Adnant, LLC in February 2021, she has been instrumental in managing the accounting for large investment funds with over $65 million in committed capital, as well as preparing companies for their two-year audit by leading the development of schedules, work papers and analytical procedures. Effective September 12, 2022, and in connection with the August Services Agreement, Ms. Chan became the Interim Chief Financial Officer and Principal Financial Officer of Unrivaled Brands, Inc., a multi-state operator with retail, production, distribution, and cultivation operations in the cannabis industry. Previously, she had served as the Chief Financial Officer for Grove Inc., a manufacturing, distribution, wholesale, and retail company in the CBD industry, where she led that company s equity fundraising, Chapter 11 restructuring, and ultimately its IPO process leaving prior to that company going public. Ms. Chan received a B.A . in Economics with a minor in accounting and political science from the University of California, Los Angeles and is a Certified Public Accountant in the State of California. 
+ 
+ 
+ 2
+ 
+
+ Table of Contents
+
+ 
+ 
+ 
+ Robert Baca, our Director, Vice President and Secretary, has over a decade of experience as a corporate attorney and consultant navigating Private Equity M&A and Leveraged Finance transactions for clients while at institutions including Kirkland & Ellis LLP, Paul Hastings LLP, and Goldman Sachs. He has represented U.S. and foreign financial institutions, private equity sponsors, and public and private companies in connection with mergers and acquisitions, securities offerings, and commercial financings including secured and unsecured credit facilities and acquisition financings. Before joining Adnant, LLC in 2020, he spent three years overseeing the licensing and compliance efforts of cannabis operations in Northern California including retail, manufacturing, distribution, and cultivation companies during the turn of adult-use legalization in the state. He also served as Executive Director of the Sacramento Cannabis Industry Association working closely with state and local regulators, stakeholders, and key community constituencies including neighborhood and business associations, business owners, and residents. He now serves as General Counsel to Adnant, LLC and participates in the leadership of their Strategic Initiatives department. In connection with the August Services Agreement, Mr. Baca also serves as the Interim Chief Legal Officer of Unrivaled Brands, Inc. Mr. Baca graduated with a BA from Dartmouth College with honors, a JD from the University of Chicago Law School, and a Master of Science in Finance from Indiana University s Kelley School of Business. He is a licensed member of the State Bars of New York and California and is an adjunct professor of law at the University of the Pacific s McGeorge School of Law teaching Marijuana Law.
+ 
+ Jaime Nava, our Director, Vice President and Treasurer has over five years of operational accounting and management experience in the cannabis industry having built the accounting and finance infrastructure for over 50 dispensaries and cultivations in California and advised on the same for public cannabis multi-state operators. He is a pioneer in cannabis banking and compliance having guided key constituencies in the development and launch of cannabis related business account and compliance pilot programs for both national financial institutions and local federal credit unions. Mr. Nava has also provided extensive support for cannabis focused investment fund development, strategy, capital deployment, and investor relations. At Adnant, LLC, he provides advisory and consulting services for cannabis companies and investment funds particularly related to their accounting, banking, and management policies and operating procedures. Prior and current clients include Cookies, AmericannMade, 1212 Ventures, and Mesh Ventures. He has focused principally on helping industry clients navigate and execute early stage and enterprise hypergrowth strategies. Mr. Nava holds a Bachelor of Science degree in Biology from California State University, San Bernardino. 
+ 
+ The majority of our board of directors does not qualify as independent directors in accordance with the published listing requirements of a national securities exchange, such as the Nasdaq Stock Market ( Nasdaq ) or the New York Stock Market (the NYSE ), or the NYSE American (the American ). The Company does not have any current plans to list its securities on Nasdaq, the NYSE, or the American. Under the OTCQX rules, issuers are generally required to have a board of directors that includes at least two independent directors, one of whom must be an independent director on the day in which the Company submits its OTCQX application materials. Our board of directors has determined that [________] and Matthew Heyman are independent directors as defined by the OTCQX rules. 
+ 
+ Past performance of our management team or Adnant Concepcion Sponsor LLC is not a guarantee either (i) of success with respect to any business combination we may consummate or (ii) that we will be able to identify a suitable candidate for our initial business combination. You should not rely on the historical performance record of our management team or Adnant Concepcion Sponsor LLC as indicative of our future performance. Additionally, in the course of their respective careers, members of our management team have been involved in businesses and deals that were unsuccessful. Our officers and directors have no experience with blank check companies or special purpose acquisition companies. In addition, our executive officers and directors may have conflicts of interest with other entities to which they owe fiduciary or contractual obligations with respect to initial business combination opportunities. For a list of our executive officers, directors and entities for which a conflict of interest may or does exist between such persons and the company, as well as the priority and preference that such entity has with respect to performance of obligations and presentation of business opportunities to us, please refer to the table and subsequent explanatory paragraph under Management Conflicts of Interest .
+ 
+ Listing Standards
+ 
+ Our securities will be traded in the over-the-counter market. It is anticipated that they will be quoted on the OTCQX, which is the top tier of the three marketplaces for the OTC trading of securities. Quotation of our securities on the OTCQX will limit the liquidity and price of our securities more than if our securities were quoted or listed on Nasdaq, the NYSE or the American. The OTCQX can be significantly illiquid, in part because it does not have a national quotation system by which potential investors can follow the market price of shares except through information received and generated by a limited number of broker-dealers that make markets in particular stocks. There is a greater chance of volatility for securities that trade on the OTCQX as compared to a national securities exchange, such as Nasdaq, the NYSE, or the American. This volatility may be caused by a variety of factors, including the lack of readily available price quotations, the absence of consistent administrative supervision of bid and ask quotations, lower trading volume, and market conditions. Our stockholders may also experience high fluctuations in the market price and volume of the trading market for our securities. These fluctuations, when they occur, have a negative effect on the market price for our securities. Accordingly, stockholders may not be able to realize a fair price from their securities when they determine to sell them or may have to hold them for a substantial period of time until the market for our securities improves.
+ 
+ In addition, the standards for quotation on the OTCQX for special purpose acquisition companies ( SPACs ) are generally less stringent than listing on a national securities exchange, such as Nasdaq, the NYSE, or the American. For example, the following conditions are mandatory for listing on Nasdaq, the NYSE, and/or the American, but are not prerequisites for our securities to be quoted on the OTCQX:
+ 
+ 
+ At least 90% of the proceeds from the offering proceeds and other concurrent sales of equity securities must be held in a trust account controlled by an independent custodian until the consummation of the SPAC s business combination.
+
+ 
+ 
+
+ 
+ The SPAC s business combination must have an aggregate fair market value of at least 80% of the value of the net assets held in trust.
+
+ 
+ 
+
+ 
+ The SPAC s board of directors is required to have a majority of independent directors.
+
+ 
+ 
+
+ 
+ Each business combination must be approved by a majority of the SPAC s independent directors.
+
+ 
+ 
+
+ 
+ The SPAC is required to have a compensation committee consisting solely of independent directors and have at least two members.
+
+ 
+ 
+
+ 
+ Independent directors must select or recommend nominees for directors.
+
+ 
+ 
+
+ 
+ The SPAC must adopt a code of conduct applicable to all directors, officers and employees.
+
+ 
+ 
+ 
+ As noted throughout this prospectus, while not a precondition for quotation on the OTCQX, our amended and restated certificate of incorporation will provide that our initial business combination will be with a target business or business with an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. This provision in our amended and restated certificate of incorporation may only be amended or eliminated upon the affirmative vote of the holders of at least sixty-five percent (65%) of all outstanding shares of our common stock, at which time, public stockholders will have an opportunity to redeem their shares of Class A Common Stock.
+ 
+ 
+ 3
+ 
+
+ 
+
+ 
+ 
+ 
+ Further, the below table sets out a comparison of certain important quantitative and qualitative listing requirements applying to SPACs by Nasdaq, the NYSE, and the OTCQX:
+ 
+ Selected Listing Requirement
+ 
+ OTCQX
+ 
+ Nasdaq & NYSE
+
+ Minimum Market Capitalization
+ 
+ At least $10 million on each of the 30 consecutive calendar days immediately preceding the day the SPAC submits all of its application materials to the OTC
+ 
+ Nasdaq Global Market: $75 million 
+ 
+ Nasdaq Capital Market: $50 million
+ 
+ NYSE: $100 million 
+ 
+ NYSE American: $50 million
+
+ 
+ 
+ 
+ 
+ 
+
+ Public Float
+ 
+ $20 million
+ 
+ Nasdaq Global Market and NYSE: At least 400 round lot holders must be holding 1.1 million shares.
+ 
+ Nasdaq Capital Market: At least 300 round lot holders must be holding 1 million shares.
+
+ 
+ 
+ 
+ 
+ 
+
+ Minimum Issue Price
+ 
+ $5.00 per share bid price as of the close of business on each of the 30 consecutive calendar days immediately preceding the SPAC s application for OTCQX.
+ 
+ Nasdaq: Minimum bid of $4.00 per share, unless other requirements are met, then the minimum bid may be $2.00 or $3.00 per share.
+ 
+ NYSE: Minimum bid of $4.00 per share.
+
+ 
+ 
+ 
+ 
+ 
+
+ Business Combination Approval
+ 
+ No corresponding requirement.
+ 
+ Nasdaq and NYSE: The business combination must be approved by a majority of the votes cast at the shareholder meeting under the applicable listing rules. Additionally, the SPAC must file and furnish a proxy or information statement subject to Regulation 14A or 14C under the Securities Exchange Act of 1934.
+
+ 
+ 
+ 
+ 
+ 
+
+ Shareholder Redemption Rights
+ 
+ No corresponding requirement.
+ 
+ Nasdaq and NYSE: Public shareholders voting against a business combination must have the right to convert their shares of common stock into a pro rata share of the aggregate amount the in the trust account.
+
+ 
+ 
+ 
+ 
+ 
+
+ Time Frame for de-SPAC Transaction
+ 
+ Within 18 months of the closing of this offering in accordance with Rule 15c2-11, which provides a time-limited window of 18 months during which broker-dealers may quote the securities of shell companies. 
+ 
+ 
+ Nasdaq: Within 36 months of the effectiveness of its IPO registration statement, or such shorter period that the company specifies in its registration statement, the SPAC must complete one or more business combinations.
+ NYSE: The SPAC will be liquidated if no business combination has been consummated within a specified time period, not to exceed three years.
+
+ 
+ 
+ 
+ 
+ 
+
+ Minimum Percentage Held in Trust Account
+ 
+ No corresponding requirement. 
+ 
+ Nasdaq and NYSE: At least 90% of the IPO proceeds (NYSE specifies gross proceeds ), together with the proceeds of any other concurrent sales of the SPAC s equity securities, must be held in a trust account controlled by an independent custodian until consummation of a business combination. Such account should be maintained by an insured depository institution , as that term is defined in Section 3(c)(2) of the Federal Deposit Insurance Act or in a separate bank account established by a registered broker or dealer.
+
+ 
+ 
+ 
+ 
+ 
+
+ Value of de-SPAC Transaction
+ 
+ No corresponding requirement.
+ 
+ Nasdaq: Requires that the SPAC must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the deposit account (excluding any deferred underwriters fees and taxes payable on the income earned on the deposit account) at the time of the agreement to enter into the initial combination.
+ NYSE: Requires that the SPAC consummate a business combination with one or more operating businesses or assets with a fair market value equal to at least 80% of the net assets held in trust (net of amounts disbursed to management for working capital purposes and excluding the amount of any deferred underwriting discount held in trust).
+
+ 
+ 
+ 
+ 
+ 
+
+ Independent Directors
+ 
+ The board of directors must include at least two independent directors. At least one member of the board of directors must be an independent director on the day the SPAC submits its application materials to the OTC. The board of directors must have a second independent director within the later of 90 days after the SPAC begins trading on the OTCQX or the time of the SPAC s next shareholder meeting.
+ 
+ Nasdaq and NYSE: A majority of the board of directors must be comprised of independent directors.
+
+ 
+ 
+ 
+ 
+ 
+
+ Board Committees
+ 
+ Must have an audit committee, a majority of the members of which are independent directors. At least one member of the audit committee must be an independent director on the day the SPAC submits its application materials. A majority of the members of the audit committee must be independent directors within the later of 90 days after the SPAC begins trading on the OTCQX or the time of the SPAC s next shareholder meeting.
+ 
+ Nasdaq and NYSE:
+ 
+ (1) Audit committee of at least three members, all of whom must be independent directors, must be able to read and understand financial statements, and at least one of whom is an audit committee financial expert.
+ 
+ (2) Compensation committee comprised of a majority of independent directors.
+ 
+ (3) Nominating and corporate governance committee is required under the NYSE rules. Nasdaq s listing rules require independent directors to select or recommend nominees for directors.
+
+ 
+ 
+ 
+ With the exception of the 80% net assets test requirement, we are not planning to adopt any of the corporate governance measures that would be required for a Nasdaq, NYSE, or American-listed company, and if we were to adopt some or all of the corporate governance measures listed above, such measures may be modified or eliminated.
+ 
+ 
+ 4
+ 
+
+ 
+
+ 
+ 
+ 
+ Our Forward Purchase Agreement
+ 
+ We believe our ability to complete our initial business combination will be enhanced by the sale of the Private Placement Warrants and the possible sale of Post-Business Combination Warrants under a Forward Purchase Agreement which are intended to provide us with appropriate funding for our initial business combination.
+ 
+ Under the Forward Purchase Agreement, which we intend to enter into prior to the effective date of this offering, our sponsor may purchase an aggregate of up to 660,410 Pre-Business Combination Warrants at a price of $1.56 per warrant. The purchase of the 660,410 Forward Purchase Warrants will take place in one or more private placements in such amounts and at such time or times as our sponsor determines, with the full amount to have been purchased no later than immediately prior to the closing of our initial business combination. 
+ 
+ The Forward Purchase Agreement will also provide that our sponsor may elect to purchase up to an aggregate of 1,309,131 Post-Business Combination Warrants, at a purchase price of $1.56 per warrant. Any elections to purchase the up to 1,309,131 Post-Business Combination Warrants will take place in one or more private placements after the closing of our initial business combination in such amounts and at such time or times as our sponsor determines.
+ 
+ The terms of the Forward Purchase Warrants will be identical to the terms of the Outstanding Redeemable Warrants included in the units being issued in this offering, except that, among other things, the Forward Purchase Warrants will have no right to vote on amendments to the warrant agreement prior to our initial business combination (with limited exceptions) and, as long as the Forward Purchase Securities are held by our sponsor or its permitted transferee, they will be subject to certain transfer restrictions and have certain registration rights. 
+ 
+ Our Business Strategy & Competitive Strengths
+ 
+ Our strategy is to pursue one or more business combinations with companies servicing and operating adjacent, or ancillary, to the cannabis sector and companies that legally cultivate, process, and/or retail cannabis. 
+ 
+ We intend to focus our search for an initial business combination on private companies that have either positive operating cash flow or compelling unit economics combined with a clear path to positive operating cash flow, tangible or intangible assets with significant barriers to entry, and experienced incentivized management teams. Our selection process is expected to leverage a unique set of relationships with proven deal-sourcing capabilities to provide us with a strong pipeline of potential targets.
+ 
+ We expect to distinguish ourselves with our ability to:
+ 
+ 
+ 
+ Leverage our Extensive Network of Relationships to Create a Unique Pipeline of Cannabis Acquisition Opportunities. We believe the combination of Mr. Carrillo s broad investment and advisory experience in addition to our ability to access a deep network of public and private enterprises, experienced operators, restructuring advisors, attorneys, accountants, family offices, hedge funds, and private equity firms will enable us to identify and evaluate compelling target businesses.
+
+ 
+ 
+ 
+
+ 
+ 
+ Employ a Rigorous Systematic Process of Identifying Target Companies and Acquiring a Business that will be Well-Received by the Public Markets. We believe that our management s strong M&A and investment track record in both private and public markets, combined with extensive public market financial reporting and compliance experience, will provide a distinct advantage for identifying, valuing and completing a business combination that will meet our investors expectations.
+
+ 
+ 
+ 
+
+ 
+ 
+ Providing an Alternative Path to Becoming Public. We believe our structure will make us an attractive business combination partner to prospective target businesses that desire to become a publicly traded company. A merger with us will offer a target business an alternative process to a public quotation rather than the traditional initial public offering process. We believe that target businesses may favor this alternative, which we believe is less expensive, while offering greater certainty of execution than the traditional initial public offering. Furthermore, once a proposed business combination is approved by our stockholders and the transaction is consummated, the target business will have effectively become public, whereas an initial public offering is always subject to the underwriters ability to complete the offering, as well as general market conditions that could prevent the offering from occurring. Once public, we believe the target business would have greater access to capital and additional means of creating management incentives that are better aligned with stockholders interests than it would as a private company. A public company can offer further benefits by augmenting a company s profile among potential new customers and vendors and aid in attracting talented management. With public company corporate governance standards, a target business may become attractive to public investors. 
+
+ 
+ 
+ 
+ 
+ 5
+ 
+
+ Table of Contents
+
+ 
+ 
+ 
+ 
+ 
+ Strong and Stable Financial Position with Flexibility. With funds in the trust account of $25,000,000 (or approximately $28,750,000 if the over-allotment option is exercised in full), which is the amount we would have available to use for a business combination, we offer a target business a variety of options such as providing the owners of a target business with shares in a public company and a public means to sell such shares, providing capital for the potential growth and expansion of its operations or strengthening its balance sheet by reducing its debt ratio. Because we are able to consummate our initial business combination using our cash, debt or equity securities, or a combination of the foregoing, we have the flexibility to use the most efficient combination that will allow us to tailor the consideration to be paid to the target business to fit its needs and desires. However, since we have no specific business combination under consideration, we have not taken any steps to secure third party financing and there can be no assurance that it will be available to us.
+
+ 
+ 
+ 
+ We intend to pursue opportunities across a number of verticals in the cannabis industry with enterprise values that are greater than the net proceeds of this offering and the sale of the Private Placement Warrants, and with a particular focus on companies within the following sectors:
+ 
+ 
+ 
+ Hardware. Vaporization products, cannabis accessories and other products featuring a recurring revenue model
+
+ 
+ 
+ 
+
+ 
+ 
+ Software. Seed to sale tracking, dispensary business software, point of sale solutions and compliance-related software
+
+ 
+ 
+ 
+
+ 
+ 
+ Labs. Cannabis testing across flower, concentrates and infused products
+
+ 
+ 
+ 
+
+ 
+ 
+ Distribution. Supply chain partners, inventory management, shipping and logistics
+
+ 
+ 
+ 
+
+ 
+ 
+ Real Estate. Retail and industrial properties for recreational and medical cannabis facilities
+
+ 
+ 
+ 
+
+ 
+ 
+ Brands and Retail. Focus on unique business models such as licensing and direct to consumer distribution and the retail sale of cannabis and cannabis products
+
+ 
+ 
+ 
+
+ 
+ 
+ Packaging and Manufacturing. Premier cannabis compliant packaging across all product types; extraction, infusion, and other manufacturing services for cannabis products
+
+ 
+ 
+ 
+
+ 
+ 
+ Cultivation. Cultivation facilities and operations with proven management teams and supply contracts
+
+ 
+ 
+ 
+
+ In pursuit of our business strategy, we intend to:
+
+ 
+ 
+ 
+
+ 
+ 
+ Opportunity Identification. Utilize the extensive network of our management team to identify candidates for a possible business combination including cannabis industry investors, business owners, industry thought leaders, advisors, members of our sponsor, financial intermediaries, managers and others;
+
+ 
+ 
+ 
+
+ 
+ 
+ Target and Industry Evaluation. Conduct a thorough assessment of the growth potential for possible targets including research and analysis of current and future market opportunities;
+
+ 
+ 
+ 
+
+ 
+ 
+ Transaction Assessment. Conduct rigorous due diligence on one or more targets, including a review of company-specific information as well as an analysis of the overall industry and competitive landscape;
+
+ 
+ 
+ 
+
+ 
+ 
+ Financing. Arrange appropriate financing to provide the target company with adequate capital to execute its business plan;
+
+ 
+ 
+ 
+
+ 
+ 
+ Transaction Pricing. Structure the transaction at a price that management deems attractive relative to its view of intrinsic value and future potential;
+
+ 
+ 
+ 
+
+ 
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+ Operational Optimization. Implementation of operational and financial business planning which we believe can accelerate the growth of the target while providing it with appropriate financial and operational flexibility; and
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+ Follow-on Acquisition Opportunities. Seek further strategic acquisitions, divestitures or other transactions following a business combination with the goal of further enhancing stockholder value.
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+ Acquisition Criteria
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+ Consistent with our strategy, we have identified the following general criteria and guidelines which we believe are important in evaluating prospective target businesses with enterprise values that are greater than the net proceeds of this offering and the sale of the Private Placement Warrants, but we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. We intend to acquire one or more businesses that we believe has the following characteristics:
+ 
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+ Benefits from access to public equity markets. Access to the public equity markets could allow the target company to utilize additional forms of capital, enhancing its ability to pursue acquisitions and capital projects, and/or strengthen its balance sheet and recruit and retain key employees through the use of publicly-traded equity compensation.
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+ Has a strong competitive position and growing platform. We will seek to invest in companies that we believe possess not only established business models and sustainable competitive advantages, but also a growing platform for equity investors.
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+ Has a strong professional management team with deep networks within the cannabis sector and the ability to adapt to a quickly changing business environment.
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+ 6
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+ Table of Contents
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+ Operated by a talented and incentivized management team. We will focus on companies with strong and experienced management teams that desire a significant equity stake in the post-business combination company. We will seek to partner with a management team and/or seller who is well-incentivized and aligned in an effort to create stockholder value.
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+ Benefits from our ability to uniquely structure a transaction to unlock and maximize value. We will look for situations where our extensive experience and creativity can architect a win-win solution for both sides of the transaction.
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+ 
+ These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our stockholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC.
+ 
+ Initial Business Combination
+ 
+ While not required under the OTCQX rules, our amended and restated certificate of incorporation will provide that our initial business combination will be with a target business or businesses with an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm that is a member of FINRA or an independent accounting firm with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. Upon the affirmative vote of the holders of at least sixty-five percent (65%) of all outstanding shares of our common stock, our amended and restated certificate of incorporation may be amended to modify or eliminate the 80% net assets requirement. Upon the approval of such amendment our public stockholders will have an opportunity to redeem their shares of Class A Common Stock.
+ 
+ We will have until 18 months from the closing of this offering to consummate an initial business combination. We anticipate structuring our initial business combination either (i) in such a way so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses, or (ii) in such a way so that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders, or for other reasons. However, we will only complete an initial business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act . Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test. If the initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as the initial business combination. If the initial business combination involves more than one target business, our board of directors will make the determination as to the fair market value of each business combination. Our board of directors will consistently apply typical valuation metrics (such valuation metrics may include asset, income, and market-based valuation approaches) in accordance with accounting principles generally accepted in the United States of America, or GAAP, to each contemplated target business. If our board of directors is not able to independently determine the fair market value of either business combination, we will obtain an opinion from an independent investment banking firm that is a member of FINRA or an independent accounting firm with respect to the satisfaction of such criteria. In determining the value of any prospective target business, our board of directors will conduct robust due diligence, including an assessment of the company s competitive advantage, through meetings with management and key employees, key customers, interactions with consultants and experts within our network, visits of key operating facilities and a review of financial, legal and operational documents.
+ 
+ Our Business Combination Process
+ 
+ We believe our management team s operational and investment track record in the cannabis industry and related sectors will provide us with a deep understanding of challenges faced by business operators and owners of cannabis-related assets. We expect to conduct robust due diligence as we evaluate a prospective target business to assess attributes that differentiate sustainable cannabis-servicing businesses from unattractive assets. We expect that our diligence will include an assessment of the company s competitive advantage through meetings with management and key employees, key customers, interactions with consultants and experts within our network, visits of key operating facilities and a review of financial, legal and operational documents. We intend to utilize our ability to bring creative solutions from a capital structure, growth, vision and operational standpoint to unlock stockholder value. In addition, we expect to retain and work with financial advisors and legal counsel as well as industry consultants to conduct due diligence, develop strategic plans, and implement operational strategies.
+ 
+ We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions that our initial business combination is fair to our company from a financial point of view.
+ 
+ Certain of our officers and directors presently have fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations to present the opportunity to such entity, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such entity. We believe, however, that the fiduciary duties or contractual obligations of our officers or directors will not materially affect our ability to complete our initial business combination. Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation.
+ 
+ 
+ 7
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+
+ Table of Contents
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+ 
+ 
+ 
+ Corporate Information
+ 
+ Our executive offices are located at The Maria Nava Building, 11516 Downey Ave., Downey, CA 90241, and our telephone number is (323) 841-0046.
+ 
+ We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile.
+ 
+ In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period.
+ 
+ We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A Common Stock that is held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act.
+ 
+ Additionally, we are a smaller reporting company as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates exceeds $250 million as of the end of the prior June 30th, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as of the prior December 31st.
+ 
+ 
+ 8
+ 
+
+ Table of Contents
+
+ 
+ 
+ 
+ THE OFFERING
+ 
+ In deciding whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and articles of association are to the amended and restated memorandum and articles of association that the company will adopt prior to the consummation of this offering; Companies Law are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; completion window are to the period following the completion of this offering at the end of which, if we have not completed our initial business combination, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, if any (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions and as further described herein. The completion window ends 24 months from the closing of this offering, or 27 months from the closing of this offering if we have executed a letter of intent, agreement in principle or definitive agreement for an initial business combination within 24 months from the closing of this offering; directors are to our current directors and our director nominees named in this prospectus; forward purchase agreement are to the agreement providing for the sale of the forward purchase units to our sponsor in a private placement to occur concurrently with the closing of our initial business combination; forward purchase securities are to the forward purchase shares and forward purchase warrants; forward purchase shares are to Class B ordinary shares to be issued as part of the forward purchase units; forward purchase units are to the units consisting of one forward purchase share and one-fourth of one forward purchase warrant to be issued pursuant to the forward purchase agreement; forward purchase warrants are to warrants to purchase Class A ordinary shares to be issued as part of the forward purchase units; founder shares are to our Class F ordinary shares initially issued to our sponsor in a private placement prior to this offering and the Class B ordinary shares that will be issued upon the automatic conversion of the Class F ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof; Lamar are to Lamar Advertising Company, the parent of our sponsor; initial shareholders are to our sponsor and the other holders of our founder shares prior to this offering; management or our management team are to our executive officers and directors (including our directors nominees that will become directors in connection with the consummation of this offering); Table of Contents If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company, and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. CALCULATION OF REGISTRATION FEE Title of Each Class of Security Being Registered Amount Being Registered Proposed Maximum Offering Price per Security(1) Proposed Maximum Aggregate Offering Price(1) Amount of Registration Fee Units, each consisting of one Class A ordinary share, $0.0001 par value, and one-fourth of one redeemable warrant(2) 34,500,000 units $ 10.00 $ 345,000,000 $ 37,639.50 Class A ordinary shares included as part of the units(3) 34,500,000 shares (4) Redeemable warrants included as part of the units(3) 8,625,000 warrants (4) Total $ 345,000,000 $ 37,639.50 (5) (1) Estimated solely for the purpose of calculating the registration fee. (2) Includes 4,500,000 units, consisting of 4,500,000 Class A ordinary shares and 1,125,000 redeemable warrants, which may be issued upon exercise of a 45-day option granted to the underwriters to cover over-allotments, if any. (3) Pursuant to Rule 416(a), there are also being registered an indeterminable number of additional securities as may be offered or issued to prevent dilution resulting from share sub-divisions, share dividends, or similar transactions. (4) No fee pursuant to Rule 457(g). (5) Previously paid. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents ordinary shares are to our Class A ordinary shares, our Class B ordinary shares, our Class C ordinary shares and our Class F ordinary shares; private placement are to the private placement of 1,000,000 private placement units being purchased by our sponsor, which will occur simultaneously with the completion of this offering, at a purchase price of $10.00 per unit for a total purchase price of $10.0 million; private placement securities are to the private placement shares and private placement warrants; private placement shares are to Class A ordinary shares to be issued as part of the private placement units; private placement units are to the units consisting of one private placement share and one-fourth of one private placement warrant to be issued in a private placement simultaneously with the closing of this offering; private placement warrants are to the warrants underlying the private placement units to be issued to our sponsor in a private placement simultaneously with the closing of this offering, and upon conversion of working capital loans, if any; public shares are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders are to the holders of our public shares, including our sponsor and management team to the extent our sponsor and/or members of our management team purchase public shares, provided that our sponsor s and each member of our management team s status as a public shareholder will only exist with respect to such public shares; related companies are to Lamar and its subsidiaries and certain other entities with an executive management team that may from time to time include one or more members of our management team; sponsor are to Lamar Partnering Sponsor LLC, a Delaware limited liability company and wholly-owned subsidiary of Lamar; warrants are to the public warrants, the forward purchase warrants and the private placement warrants; and we, us, our, company or our company are to Lamar Partnering Corporation, a Cayman Islands exempted company. Any forfeiture of shares described in this prospectus will take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class F ordinary shares described in this prospectus will take effect as a compulsory redemption of Class F ordinary shares and an issuance of Class B ordinary shares as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED JANUARY 6, 2022 PRELIMINARY PROSPECTUS Lamar Partnering Corporation $300,000,000 30,000,000 Units Lamar Partnering Corporation is a blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. We may pursue an initial business combination target in any industry or geographic location (subject to certain limitations described in this prospectus). This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share and one-fourth of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment, terms and limitations as described herein. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. The warrants will become exercisable 30 days after the completion of our initial business combination, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. Subject to the terms and conditions described in this prospectus, we may redeem the warrants once the warrants become exercisable. The underwriters have a 45-day option from the date of this prospectus to purchase up to 4,500,000 additional units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination, subject to the limitations as described herein. If we have not consummated an initial business combination within 24 months from the closing of this offering (or 27 months from the closing of this offering if we have executed a letter of intent, agreement in principle or definitive agreement for an initial business combination within 24 months from the closing of this offering), we will redeem 100% of the public shares for cash, subject to applicable law and certain conditions as described herein. Our sponsor, Lamar Partnering Sponsor LLC, a Delaware limited liability company (which we refer to as our sponsor throughout this prospectus), is a wholly-owned indirect subsidiary of Lamar Advertising Company, a Delaware corporation (which we refer to as Lamar throughout this prospectus), listed on The Nasdaq Stock Market LLC ( Nasdaq ) under the symbol LAMR. Prior to the consummation of this offering, we will enter into a private unit purchase agreement with our sponsor whereby out sponsor will agree to purchase 1,000,000 private placement units, at price of $10.00 per unit, in a private placement to occur concurrently with the closing of this offering. Each private placement unit will be identical to the units sold in this offering, except as described in this prospectus. As of the date of this prospectus, our initial stockholders own 8,625,000 Class F ordinary shares (which we refer to as our founder shares throughout this prospectus), up to 1,125,000 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. The Class F ordinary shares will automatically convert into Class B ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described herein. Prior to and following our initial business combination, each share of Class B ordinary shares is convertible, at the option of the holder, into one share of our Class A ordinary shares. Prior to our initial business combination, only holders of our Class F ordinary shares will be entitled to vote on the appointment of directors. On any vote to approve our initial business combination or on any other Table of Contents Proposed Business Lamar Partnering Corporation (sometimes referred to herein as LPC ) is a newly formed company, incorporated as a Cayman Islands exempted company and incorporated for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses or assets, which we refer to throughout this prospectus as our partnering transaction . Although we may pursue an acquisition in any industry or geography, we intend to capitalize on the experience and skills of our management team and sponsor by focusing our search primarily on the following sectors: (i) digital media, (ii) advertising technology, (iii) international advertising, and/or (iv) distributed energy and wireless communications infrastructure. We have not selected any business with which we will partner and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with respect to a specific partnering transaction. Lamar Partnering Corporation intends to be a long-term owner and ongoing strategic partner. We will look for an appropriate strategic partner or partners that, with access to public markets and ongoing support from the sponsor, can amplify value for shareholders. We want to apply our sponsor s key attributes to help a partner enhance its business strategy/planning, optimize its capital structure, and pursue synergistic opportunities. We expect to provide our sponsor and other investors access to otherwise inaccessible growth opportunities, and we intend to avoid opportunities that compete with our sponsor s focus on acquiring REIT qualified assets. We believe Lamar Partnering Corporation is a shareholder-aligned vehicle that will leverage our sponsor s extensive distribution network, high quality relationships, and demonstrated capabilities to bring ongoing value to the partnering transaction. The Sponsor Our sponsor is a wholly owned subsidiary and an affiliate of the Lamar Advertising Company ( Lamar ), a publicly-traded real estate investment trust and one of the largest out-of-home advertising companies in the United States based on number of displays. Lamar was founded in 1902 and has been public for 25 years. Lamar s footprint includes more than 350,000 displays across 45 states and two Canadian provinces, and serves customers from the largest multinational corporations to small, neighborhood retailers. Lamar has deep roots across many often-overlooked small and middle markets where operators are traditionally capital constrained, but where high operating margins can be achieved when an operator is capitalized and managed appropriately. Lamar has catalyzed innovation in its industry, including promoting development, implementation, and continuing innovation in large-format digital billboards and pushing programmatic buying into digital out-of-home advertising. Lamar now has the largest network of large-format digital billboards in the United States. As a result, our sponsor, as a subsidiary of Lamar, has the scale and reach to identify and attract a partnering transaction and support the new partner company as it grows. As the parent company of our sponsor, Lamar will provide its expertise to us in sourcing a partnering transaction. Lamar may derive economic benefits from transactions between us and our sponsor as the sponsor s parent company, see The Offering - Limited payments to insiders . We are not prohibited from pursuing a partnering transaction with a business that is affiliated with our sponsor, officers, directors or members of our advisory board (including Lamar). In the event we seek to complete our initial partnering transaction with a business that is affiliated with our sponsor, officers, directors or members of our advisory board (including Lamar), we, or a committee of independent and disinterested directors, will obtain an opinion from an independent investment banking firm that is a member of the Financial Industry Regulatory Authority, or FINRA , or from an independent accounting firm, that our initial partnering transaction is fair to LPC from a financial point of view. Additionally, if we pursue a partnering transaction with a business in one of our target sectors which also holds certain assets which are a better fit for Lamar s business, Lamar may opt to purchase such assets for itself. After the initial business combination, Lamar may engage in other transactions with us Table of Contents matter submitted to a vote of our shareholders prior to our initial business combination, holders of our Class A ordinary shares, holders of our Class B ordinary shares, if any, and holders of our Class F ordinary shares will generally vote together as a single class, except as required by Cayman Islands law or stock exchange rule, with each ordinary share entitling the holder to one vote. Following our initial business combination, holders of our Class A ordinary shares and holders of our Class B ordinary shares will generally vote together as a single class on all matters presented for a shareholder vote, except as required by Cayman Islands law or stock exchange rule, with each Class A ordinary share entitling the holder to one vote per share and each Class B ordinary share entitling the holder to ten votes per share. This high vote feature of our Class B ordinary shares differs from the typical capital structure of many other special purpose acquisition companies, in which the number of votes for founder shares and public shares remain the same after the initial business combination. Prior to the consummation of this offering, we will enter into a forward purchase agreement with our sponsor, pursuant to which our sponsor has agreed to purchase up to $100,000,000 of forward purchase units. Each forward purchase unit will consist of one Class B ordinary share and one-fourth of one warrant to purchase one Class A ordinary share, and will be sold at a purchase price of $10.00 per unit in a private placement concurrently with the closing of our initial business combination. The obligations of our sponsor under the forward purchase agreement do not depend on whether any Class A ordinary shares held by public shareholders are redeemed by us and the amount of forward purchase units sold pursuant to the forward purchase agreement will be subject to our sponsor s sole discretion. The forward purchase shares will be entitled to certain registration rights, as described herein. The forward purchase warrants will have the same terms as the private placement warrants so long as they are held by our sponsor or its permitted assignees and transferees. If issued, the forward purchase shares and forward purchase warrants, if exercised, will increase our outstanding ordinary shares, which will dilute the ownership percentages of our ordinary shareholders. Currently, there is no public market for our securities. We intend to apply to have our units listed on Nasdaq, under the symbol LPCXU. We cannot guarantee that our securities will be approved for listing on Nasdaq. We expect that the Class A ordinary shares and warrants comprising the units will begin separate trading on Nasdaq under the symbols LPC and LPCXW, respectively, on the 52nd day following the date of this prospectus unless the underwriters permit earlier separate trading and we have satisfied certain conditions. We are an emerging growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 38 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 300,000,000 Underwriting discounts and commissions(1) $ 0.55 $ 16,500,000 Proceeds, before expenses, to us $ 9.45 $ 283,500,000 (1) Includes $0.35 per unit, or $10,500,000 in the aggregate (or $12,075,000 in the aggregate if the underwriters over-allotment option is exercised in full), payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein and released to the underwriters only upon the consummation of an initial business combination. Does not include certain fees and expenses payable to the underwriters in connection with this offering. See also Underwriting for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement units described in this prospectus, $300,000,000, or $345,000,000 if the underwriters over-allotment option is exercised in full ($10.00 per unit in either case), will be deposited into a U.S. based trust account with Continental Stock Transfer & Trust Company acting as trustee. Except with respect to interest earned on the funds held in the trust Table of Contents from time to time, for which it may receive additional compensation or economic benefits, and the amount and terms of any such compensation or economic benefit to Lamar has not yet been determined. Any such related party transactions would be subject to approval by a committee of independent and disinterested directors. We believe that Lamar is well positioned to assist our sponsor to help us drive growth in a partnering transaction based on the following key attributes: Key Attributes: Long-Tenured, Disciplined, Strategic Management Team. The management team has over 75 years in combined industry experience, and has built the broadest, most profitable network of OOH advertising assets in North America. The team has cultivated a culture of entrepreneurship, innovation, and discipline at our sponsor. Access to Capital Markets & Proven Performance. Lamar has one of the strongest balance sheets in the OOH industry, providing financial flexibility that it utilizes to invest in internal growth opportunities and in accretive acquisitions in a disciplined fashion, as demonstrated by Lamar s performance through the COVID-19 pandemic. Extensive Acquisition Expertise. Lamar is a longstanding, consistent, and dependable dealmaker in its sector, thanks to its focus on methodical due diligence and on identifying established cash flows at reasonable prices across markets and economic cycles. Decentralized Operating Structure. Lamar recognizes that operators have an important role in the success of a company, and maintains a decentralized structure to foster the flexibility and ingenuity of its local operator-managers, while centralizing the elements of the business that can benefit from the specialized skill set of a larger company including, but not limited to, IT, capital allocation, and human resources. Broad Network & Finger-on-the-Pulse of the Sector. As an industry leader, we believe Lamar s coast-to-coast platform provides unparalleled insight into advertising trends in major metropolitan, middle and small markets across the United States and in Canada. Lamar also has extensive relationships with tens of thousands of lessors through its real estate portfolio and with hundreds of state and municipal governmental agencies across the United States. Innovative & Forward Thinking Culture. Lamar s management recognizes the strategic importance of investing in new technologies adjacent to its core billboard business and seeks creative ways to accomplish strategic goals. An investment in our securities is not an investment in Lamar. We have no current business, other than to seek a partner in a partnership transaction. None of Lamar s existing businesses will be a source of returns for investors in this offering. Our Business Strategy Our business strategy is to identify a company with demonstrated growth potential and the opportunity to create value in the public markets. We expect the partner to benefit from the experience, expertise and operating skills of our corporate sponsor and its management team. As we identify a target and execute a combination, we intend to utilize our strengths, which include: Differentiated Investment Sourcing. Lamar s management team routinely reviews high quality investment opportunities that are not attractive to Lamar because of its REIT structure. Lamar Partnering Corporation can serve as a strategic financing vehicle to act upon opportunities outside of Lamar s focus on REIT qualified assets. This way, we hope to identify a partner that is poised to capitalize on trends in the market beyond REIT qualified assets. Table of Contents account that may be released to us to pay our taxes, if any, the funds held in the trust account will not be released from the trust account until the earliest of: (1) the completion of our initial business combination; (2) the redemption of any public shares properly submitted in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to allow redemptions in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering (or 27 months from the closing of this offering if we have executed a letter of intent, agreement in principle or definitive agreement for an initial business combination within 24 months from the closing of this offering, which we refer to as an agreement in principle event throughout this prospectus) or (B) with respect to any other provision relating to shareholders rights or pre-initial business combination activity; and (3) the redemption of all of our public shares if we have not completed our initial business combination within 24 months from the closing of this offering (or 27 months if an agreement in principle event has occurred), subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about . Book-Running Managers Morgan Stanley Citigroup The date of this prospectus is Table of Contents Ability to Add Strategic Value. We believe we will be able to accelerate a partner s growth by facilitating its access to Lamar s extensive network and high quality relationships. We expect our management team to bring its entrepreneurial spirit to the search for a partnering transaction that can add strategic value to both our sponsor and potential partner(s). Experts in Structuring Successful Transactions and Creating Value. Our management team (which consists of members of Lamar s management team) has a track record at Lamar (and in their previous work experience) of creating value for investors by identifying talent, leveraging networks, raising capital, and structuring transactions. This experience gives us an advantage in sourcing, evaluating, negotiating, and integrating a partnering transaction. Our Commitment. We have structured Lamar Partnering Corporation to signal our long-term engagement with our partner(s) and our structural alignment with shareholders. The capital commitment associated with the forward purchase agreement (described below) demonstrates our sponsor s interest in the partnership s ongoing success. Forward Purchase Agreement We believe our ability to complete our initial business combination will be enhanced by the additional security we bring by entering into a forward purchase agreement with our sponsor pursuant to which our sponsor has agreed to purchase, in the aggregate, up to $100,000,000 of forward purchase units. Each forward purchase unit will consist of one Class B ordinary share, or a forward purchase share, and one-fourth of one warrant to purchase one Class A ordinary share, or a forward purchase warrant, at a purchase price of $10.00 per unit, and will be sold in a private placement concurrently with the closing of our initial business combination. The amount of forward purchase units sold pursuant to the forward purchase agreement will be subject to our sponsor s sole discretion. The forward purchase warrants will have the same terms as the private placement warrants so long as they are held by our sponsor or its permitted assignees and transferees. We believe that the forward purchase arrangement with our sponsor ensures alignment with shareholders and will make us more attractive to a potential business combination partner. Our Acquisition Criteria Our management team will deploy a proactive, methodical deal sourcing strategy to identify companies whose growth potential and value we believe will be enhanced by our sponsor s key attributes (above) and able to provide an attractive risk-adjusted return to our shareholders. While not exhaustive or exclusive, the following criteria and guidelines illustrate how we plan to identify and evaluate prospective partners. Intersection of Out-of-Home, Technology, and Communications. We plan to partner with a company in a sector that is tangential to our sponsor s expertise and does not compete with its REIT-focused acquisition strategy. These may include, but are not limited to: Non-REIT Transit, Airport, and other Digital Media/Digital Addressable Screen Networks. Advertising Technology. International Out-of-Home. Distributed Energy and Wireless Communications Infrastructure. Experienced, Established Management Team. We plan to partner with a business with an entrepreneurial management team with demonstrated experience and discipline in its approach to capital allocation and a focus on growth. Table of Contents We are responsible for the information contained in this prospectus. We have not authorized anyone to provide you with different information, and neither we nor the underwriters take any responsibility for any other information others may give to you. We are not, and the underwriters are not, making an offer to sell securities in any jurisdiction where the offer or sale is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front of this prospectus. TABLE OF CONTENTS SUMMARY 1
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: Cantor are to Cantor Fitzgerald & Co., a representative of the underwriters in this offering; CCM are to J.V.B. Financial Group, LLC on behalf of its Cohen & Company Capital Markets division, whom we have engaged to provide consulting and advisory services in connection with this offering; common stock are to our Class A common stock and our Class B common stock, collectively; founder shares are to shares of our Class B common stock initially purchased by our sponsor in a private placement prior to this offering, and the shares of our Class A common stock issued upon the conversion of the Class B common stock at the time of our initial business combination as provided herein; initial stockholders are to our sponsor and any other holders of our founder shares prior to this offering; management or our management team are to our officers and directors (including our director nominees who will become directors upon consummation of this offering); Moelis are to Moelis & Company LLC, a representative of the underwriters in this offering, and/or Moelis & Company Group LP, an affiliate of Moelis & Company LLC; private placement warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering, which private placement warrants are identical to the warrants sold as part of the units in this offering; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our initial stockholders and members of our management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder s and member of our management team s status as a public stockholder shall only exist with respect to such public shares; public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); sponsor are to Virtuoso Sponsor 2 LLC, a Delaware limited liability company affiliated with Jeffrey D. Warshaw, our Chief Executive Officer and Michael O. Driscoll, our Chief Financial Officer; warrants are to our redeemable warrants, which includes the public warrants as well as the private placement warrants; we, us, company or our company are to Virtuoso Acquisition Corp. 2; and Virtuoso I are to Virtuoso Acquisition Corp., a blank check company that completed its initial business combination on November 18, 2021. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Overview We are a newly organized blank check company incorporated as a Delaware corporation and formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any specific business combination target and we have not, nor has 1 Table of Contents anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. While we may pursue an initial business combination target in any stage of its corporate evolution or in any industry or sector, we intend to focus our search on businesses in the media, technology, technology-enabled, ad tech, data and mobility sectors, as well as other industries and sectors that are being disrupted by technological advances. Our management team has had significant success sourcing, acquiring, growing and monetizing these types of companies. We believe this experience makes us well suited to identify, source, negotiate and execute an initial business combination with the ultimate goal of pursuing attractive risk-adjusted returns for our stockholders. Management Team and Board of Directors Management Team We believe our management team is well positioned to identify and evaluate businesses within the media and technology industries that would benefit from being a public company and from access to our expertise. We believe we can achieve this mission by utilizing our team s extensive experience in growing and operating media and technology companies as well as our broad network of contacts in the media and technology sectors. Jeffrey D. Warshaw, Chief Executive Officer, has 35 years building, acquiring, operating and investing in media businesses. Starting at age 19, Mr. Warshaw has run a number of successful entities with a focus on creating strong market positions and exceptional management teams. At age 28 in 1993, Mr. Warshaw founded Connoisseur Communications Partners, an owner and operator of radio stations, and he partnered with Tinicum Investments and later Abry Partners, LLC. Through disciplined acquisitions and operating management, Connoisseur Communications Partners grew to 35 radio stations and was sold in 2000 to Cumulus Broadcasting for over $250,000,000. Following the sale of Connoisseur Communications Partners in 2004, Mr. Warshaw founded Connoisseur Media, a multi-platform local media company with radio, streaming, and digital and traditional advertising agency businesses. Mr. Warshaw was a pioneer of combining digital with legacy media, founding Ferocious Media as a division of Connoisseur Media in 2010. Over the course of his career, Mr. Warshaw has led numerous equity and debt raises for his companies. Mr. Warshaw has also leveraged his media business operating experience and partnered with investment funds (Farallon, Abry, MatlinPatterson) to invest in media debt and assets. In addition, from October 2017 to November 2019, Mr. Warshaw served on the board of Horizon HVAC, which was sold to New Mountain Capital in November 2019. Mr. Warshaw served as Chief Executive Officer of Virtuoso I from August 2020 until completion of its initial business combination with Wejo in November 2021. Mr. Warshaw currently serves on the Board of the National Association of Broadcasters, is Chairman of the Nielsen Audio Advisory Council, a member of the Executive Committee of the Board of Directors of the Radio Advertising Bureau, Board Member of the Broadcasters Foundation of America, and Board Member of Phiphen Pictures. Mr. Warshaw has received many honors, including the Ward L. Quall Leadership Award from BFOA. Mr. Warshaw received a B.S.E. from the Wharton School of the University of Pennsylvania in 1986. Michael O. Driscoll, our Chief Financial Officer and Director, has 39 years of experience in financial and Investment Management and currently serves as the EVP and Co-Founder of Connoisseur Media, where he started in 2004. Until December 31, 2021, Mr. Driscoll also served as the Chief Financial Officer of Connoisseur Media. He is responsible for managing the financial and administrative aspects of the Company including: finance and accounting, acquisitions, divestitures, financing transactions, financial structuring, insurance, taxes and also human resources. Over the last 24 years of his partnership with Mr. Warshaw, he has been involved with numerous equity raises, financings and transactions. Driscoll was responsible for due diligence and was involved in negotiating with lenders, investors sellers and buyers. Prior to Connoisseur Media, he was the Chief Financial Officer of Mr. Warshaw s Connoisseur Communications Partners, from 1996 to 2001, where he managed finance and administration and played a critical part in the company s growth and was involved in the sale of the company for more than $250,000,000 in 2000. Mr. Driscoll served as the Chief Financial Officer of Virtuoso I from January 2021, alongside Mr. Warshaw, until completion of its initial business combination with Wejo in November 2021. Prior to working with Mr. Warshaw, he was the SVP/CFO at US Radio, Inc., for 10 years from 1986 to 1996. US Radio Inc., which was primarily owned by a Blackstone merchant banking fund when it was sold in 1996 for 2 Table of Contents $140,000,000. In 2020, he was named by Radio+ Television Business Report as one of the best finance leaders of 2020. Driscoll has a B.S. from the University of Connecticut, a M.S.M. from Purdue University, and a CFA from the CFA Institute. Board of Directors Our board of directors will include Jeffrey Warshaw, Michael Driscoll, Samuel Hendel, Peggy Koenig and Alan Masarek. Samuel Hendel is a Co-Founder of Dataminr, which he began with two of his former Yale classmates in 2009. CNBC recognized Dataminr on its list of Disruptor 50 companies, and in March 2021 Dataminr raised $475 million at a $4.1 billion valuation. In 2021, Hendel partnered with KKR to purchase KMR Music Royalties II, a unique catalogue of 62,000 music copyrights, from Kobalt Capital for approximately $1.1 billion. Mr. Hendel will serve as a founding board member of the new joint venture, Chord Music Partners, that will continue to scale by providing flexible capital solutions for artists and creators and exploring NFT monetization opportunities. In addition, Hendel has 18 years of experience in the investment management industry and most recently served as Portfolio Manager and President of Easterly Investment Partners. Prior to joining Easterly, Hendel was Co-Portfolio Manager for risk arbitrage and event-driven strategies at Satellite Asset Management from 2006 to 2009. That position followed three years at UBS, from 2003 to 2006, where Hendel was an Associate Director, serving in both the portfolio trading and proprietary trading groups. In his personal capacity, Hendel is an Associate Fellow of Davenport College at Yale University in addition to being Co-Founder of Accelerate Yale, an alumni shared interest group focused on promoting entrepreneurship at Yale. Hendel has additional board experience, serving as the Chairman of OkayMedia, which includes OkayPlayer, a music and lifestyle website founded in 1999 by Ahmir (Questlove) Thompson of the hip hop band The Roots, and OkayAfrica, the leading digital media company focused on African culture. Hendel served on the board of Virtuoso I from January 2021, where he served as a member of the Audit and Compensation Committees from August 2020 until completion of its initial business combination in November 2021. Following such business combination, Hendel has served on the board of Wejo. He also serves on the board of ImpaCT, a Connecticut-based charity focused on providing support to underprivileged youth in the local community alongside his wife. Mr. Hendel received a B.A. from Yale University. Peggy Koenig has over 30 years of investing in, managing and financing media, communications, information and business services companies. She is currently the Chair of Boston-based private equity firm, Abry Partners, where she was involved with starting the private equity practice in 1994 as a Partner. She served as co-CEO from 2010 to 2017, where she had principal responsibility for the firm s investment strategy, capital formation and investment team. Koenig has originated, supervised and sold numerous companies in Abry s targeted sectors. Areas of focus have included cable television, marketing services, logistics, business services, tech enabled services, and radio television broadcasting. Prior to joining Abry, she was the President and Founder of Koenig Management Group from 1992 to 1993. Before, Koenig was a partner and member of the board of directors of Sillerman Communications Management Corporation from 1988 to 1992, a merchant bank making investments principally in the radio industry. She also has extensive media financing experience in industries including feature film production, cable television, and magazine publishing. She is currently the Producing Director of Black Cap Productions, where she is producing a musical inspired by the book Lives in Limbo. She is also a member of the National Board of the non-profit Cradles to Crayons, the Massachusetts Women s Forum, Citi Private Bank North American Advisory Board, and the Advisory Board of the Carr Center for Human Rights at the Harvard Kennedy School. She served on the board of Virtuoso I from January 2021, where she served as a member of the Audit Committee, until completion of its initial business combination with Wejo in November 2021. Koenig received a B.S. from Cornell University, an MBA from the Wharton Business School, and a fellowship in Advanced Leadership from Harvard University. She is currently a Vice Chair of the Board of Trustees of Cornell University, where she is Chair of the Research and Innovation Committee as well as a member of the Executive Committee of Cornell University. She is also a member of the Cornell Tech Council of Cornell s NY Tech Campus and a member of the Board of Advisors at the Millstein Program in Technology and Humanity. Alan Masarek has over 25 years of experience in communications, information technology and business services companies. Most recently, he was Chief Executive Officer and a member of the Board of Directors of Vonage (Nasdaq: VG) from November 2014 to June 30, 2020. Masarek came to Vonage from Google, Inc., where he was Director, Chrome & Apps from June 2012 until October 2014, following the acquisition of his prior company, Quickoffice, Inc. Masarek was a Co-founder and its CEO from November 2014 to June 2020. Masarek served on 3 Table of Contents the board of Virtuoso I from January 2021 until the completion of its initial business combination with Wejo in November 2021, and following such business combination, Masarek has served on the board of Wejo. Since July 2021, Masarek has served as a director of Markforged. Masarek earned his M.B.A., with Distinction, from Harvard Business School and his B.B.A., Magna Cum Laude, from the University of Georgia. Prior Blank Check Company Experience Our management team and our board of directors were also the management team and board of directors of Virtuoso I, which raised an aggregate of $230,000,000 in its initial public offering (including exercise of the over-allotment option) in January 2021 and completed its initial business combination with Wejo Group Limited, referred to as Wejo, a leader in connected vehicle data, on November 18, 2021. Past performance of our management team and their respective affiliates, including with respect to Virtuoso I and Wejo, is not a guarantee either (i) of success with respect to any business combination we may consummate, or (ii) that we will be able to identify a suitable candidate for our initial business combination. You should not rely on the historical performance record of our management team or its affiliates as indicative of our future performance. In addition, for a list of members of our management team and entities for which a conflict of interest may or does exist between such persons and the company, as well as the priority that such entity has with respect to performance of obligations and presentation of business opportunities to us, please refer to the table and subsequent explanatory paragraph under Management Conflicts of Interest . Market Overview Many industries are in a period of dramatic change. Technology will continue to cause disruptions and opportunities. Companies are challenged to constantly refine their business plans to stay relevant, and emerging technologies are creating further dislocation. With this dislocation comes potential new ways to monetize and carve out viable paths to long-term growth. We believe that well-financed, nimble companies that can grow organically as well as through an accretive acquisition strategy will have a sustainable advantage. We believe that there are many companies that could become attractive public companies. These companies employ many different business models that include, high growth companies, strong free cash flow generating companies, and innovative technology platforms to companies that have high barriers to entry. Business Strategy Our business strategy is to capitalize on our management team s industry knowledge, strategic vision, operational expertise and business connections built up over decades in the media and technology industries in combination with the resources available to the sponsor and its affiliates to identify and complete our initial business combination with a company that our management and Board believes has compelling potential for value creation through our involvement. Mr. Warshaw and Mr. Driscoll will leverage their long-term partnership, investment experience and deep network to identify and generate attractive acquisition opportunities including companies in the media, technology, technology-enabled, ad tech, data and mobility sectors, as well as other industries and sectors that are being disrupted by technological advances. In addition to leveraging our management and Board s network of proprietary and public transaction sources, where we believe our management team has experience in the following, which we will use to our advantage in the search and combination process: Executing acquisitions/sales, including numerous complex transactions, equity raises and bank syndications. Developing and growing companies, both organically and through strategic transactions and acquisitions, and expanding the product range and geographic footprint of a number of target businesses. Extensive operating experience and success with turnarounds, consolidations, and start-ups. Created and maintained dominant market positions many times. 4 Table of Contents Demonstrated ability to repeatedly capitalize on market opportunities. Experience in investing in private and public companies to accelerate their growth and maturation. Creating relationships with sellers, capital providers and management teams. Business Combination Criteria Our business combination criteria will not be limited to a particular industry or geographic sector, however, given the experience of our management team and board, we intend to focus our search on companies in the media, technology, technology-enabled, ad tech, data and mobility sectors, as well as other industries and sectors that are being disrupted by technological advances, with an enterprise value of approximately $650 million to $1.5 billion. We believe the following general criteria and guidelines are important in evaluating prospective target businesses, but we may decide to enter into a business combination with a target business that does not meet these criteria and guidelines. Large and growing market. We will focus on investments in industry segments that we believe demonstrate attractive long-term growth prospects and reasonable overall size or potential. Attractive, inherently profitable business with high operating leverage. We will seek to invest in companies that we believe possess not only established business models and sustainable competitive advantages, but also inherently profitable unit economics. Strong management teams. We will spend significant time assessing a company s leadership and personnel and evaluating what we can do to augment and/or upgrade the team over time if needed. Opportunity for operational improvements. We will seek to identify businesses that we believe are stable but at an inflection point and would benefit from our ability to drive improvements in the company s processes, go-to-market strategy, product or service offering, sales and marketing efforts, geographical presence and/or leadership team. Differentiated products or services. We will evaluate metrics such as recurring revenues, product life cycle, cohort consistency, pricing per product or customer, cross-sell success and churn rates to focus on businesses whose products or services are differentiated or where we see an opportunity to create value by implementing best practices. Compelling growth prospects. We view growth as an important driver of value and will seek companies whose growth potential can generate meaningful upside. Limited technology risk. We will seek to invest in companies that have established market-tested product or service offerings. Appropriate valuations. We will seek to be a disciplined and valuation-centric investor that will invest on terms that we believe provide significant upside potential with limited downside risk. Benefit from Being a Public Company. We intend to pursue a business combination with a company that we believe will benefit from being publicly traded and can effectively utilize the broader access to capital and public profile that are associated with being a publicly traded company. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management team may deem relevant. In the event that we find an opportunity that has characteristics more compelling to us than the characteristics described above, we would pursue such opportunity. 5 Table of Contents Competitive Strengths We intend to leverage the following sources of competitive strength in seeking to achieve our business strategy: Management team s industry knowledge and contacts. Deal flow and business development resources available to our sponsor and its affiliates. Management team s experience and reputation in sourcing opportunities. Extensive relationships within the private equity community (a likely source of deal flow). Management team s demonstrated ability to create value for their stockholders. Strong track record of operational excellence. Our Acquisition, Investment and Post-Closing Process In evaluating prospective business combinations, we expect to conduct a thorough due diligence review process that will encompass, among other things: an analysis of overall industry and competitive conditions, a review of historical financial and operating data, meetings with incumbent management and employees, interaction with third-parties who are industry experts, on-site inspection of facilities and assets, discussion with customers and suppliers, legal and other reviews as we deem appropriate. We will also utilize the expertise of our management team and our sponsor s and its affiliates resources in analyzing and evaluating operating plans, financial projections and determining the appropriate return expectations given the risk profile of the target business as well as the suitability of the target to become a public company. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors, subject to certain approvals and consents. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm which is a member of the Financial Industry Regulatory Authority ( FINRA ) or an independent accounting firm that commonly renders fairness opinions that our initial business combination is fair to us from a financial point of view. Initial Business Combination Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm which is a member of FINRA or an independent accounting firm that commonly renders fairness opinions with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination either (i) in such a way so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses, or (ii) in such a way so that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders, or for other reasons. However, we will only complete an initial business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders 6 Table of Contents prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of Nasdaq s 80% fair market value test. If the initial business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. Our Business Combination Process Each of our sponsor, directors and officers will, directly or indirectly, own our founder shares, common stock and/or private placement warrants following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors were to be included by a target business as a condition to any agreement with respect to our initial business combination. Our sponsor and members of our management team are, in the ordinary course of business, continuously made aware of potential acquisition or investment opportunities, one or more of which we may desire to pursue for an initial business combination. We have not, however, selected any specific business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations to present the opportunity to such entity, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such entity. We believe, however, that the fiduciary duties or contractual obligations of our officers or directors will not materially affect our ability to complete our initial business combination, as we believe any such opportunities presented would be smaller than what we are interested in, in different fields than what we would be interested in, or that our obligations are to entities that are not themselves in the business of engaging in business combinations. Our amended and restated certificate of incorporation provides that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation. Our officers have agreed not to become an officer of any other special purpose acquisition company with a class of securities intended to be registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act, which has publicly filed a registration statement with the SEC until we have entered into a definitive agreement regarding our initial business combination or we have failed to complete our initial business combination within 18 months from the consummation of this offering. Corporate Information Our executive offices are located at 180 Post Road East, Westport, CT 06880 and our telephone number is (203) 227-1978. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, 7 Table of Contents we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A common stock that is held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates exceeds $250 million as of the prior June 30th, or (2) our annual revenues exceed $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as of the prior June 30. 8 Table of Contents THE OFFERING
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus, is not complete and does not contain all the information that may be important to you in making an investment decision. You should read this entire prospectus carefully, including the Explanatory Note and the information under Risk Factors and Cautionary Statement Regarding Forward-Looking Statements and the consolidated financial statements and the notes thereto appearing elsewhere in this prospectus before making an investment decision. Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. Our Company Finco is a direct, wholly-owned and controlled subsidiary of Noble Parent. Noble is a leading offshore drilling contractor for the oil and gas industry. Noble provides contract drilling services to the international oil and gas industry with its global fleet of mobile offshore drilling units. Noble focuses on a high-specification fleet of floating and jackup rigs and the deployment of its drilling rigs in oil and gas basins around the world. The consolidated financial statements of Noble Parent have been included in this registration statement because they include the accounts of Finco and Noble Parent conducts substantially all of its business through Finco and its subsidiaries. Noble and its predecessors have been engaged in the contract drilling of oil and gas wells since 1921. Contract Drilling Services We report our contract drilling operations as a single reportable segment, Contract Drilling Services, which reflects how we manage our business. The mobile offshore drilling units comprising our offshore rig fleet operate in a global market for contract drilling services and are often redeployed to different regions due to changing demands of our customers, which consist primarily of large, integrated, independent and government-owned or controlled oil and gas companies throughout the world. We typically provide contract drilling services under an individual contract, on a dayrate basis. Although each contract s final terms and conditions are the result of negotiations with our customers, many contracts are awarded through a competitive bidding process. During periods of depressed market conditions, such as the one we recently experienced for a number of years, our customers may attempt to renegotiate or repudiate their contracts with us although we seek to enforce our rights under our contracts. The renegotiations may include changes to key contract terms, such as pricing, termination and risk allocation. Drilling Fleet Noble is a leading offshore drilling contractor for the oil and gas industry. Noble owns and operates one of the most modern, versatile and technically advanced fleets of mobile offshore drilling units in the offshore drilling industry. Noble provides, through its subsidiaries, contract drilling services with a fleet of 19 offshore drilling units, consisting of 11 floaters and eight jackups at the date of this prospectus, focused largely on ultra-deepwater and high-specification drilling opportunities in both established and emerging regions worldwide. Each type of drilling rig is described further under Business Drilling Fleet. At the date of this prospectus, our fleet was located in Africa, the Middle East, the North Sea, Oceania, South America and the US Gulf of Mexico. Table of Contents TABLE OF ADDITIONAL REGISTRANTS Exact Name of Additional Registrant as Specified in its Charter* State or Other Jurisdiction of Incorporation or Organization I.R.S. Employer Identification Number Bully 1 (Switzerland) GmbH** Switzerland 98-0568935 Noble BD LLC Delaware 82-5210197 Noble Cayman SCS Holding Ltd Cayman Islands 98-1350467 Noble Contracting II GmbH** Switzerland Noble Drilling (Guyana) Inc.*** Guyana 98-1405736 Noble Drilling (Norway) AS Norway 52-2239546 Noble Drilling (TVL) Ltd. Cayman Islands Noble Drilling (U.S.) LLC Delaware 76-0295031 Noble Drilling Doha LLC Doha, Qatar Noble Drilling International GmbH** Switzerland 98-0688632 Noble Drilling Services LLC (f/k/a Noble Drilling Services Inc.) Delaware 76-0295033 Noble DT LLC Delaware 84-3405555 Noble International Finance Company Cayman Islands 98-0655893 Noble Leasing (Switzerland) GmbH** Switzerland 98-0566694 Noble Leasing III (Switzerland) GmbH** Switzerland 98-0631434 Noble Resources Limited Cayman Islands 98-1096876 Noble Rig Holding 2 Limited Cayman Islands 98-1461033 Noble Rig Holding I Limited Cayman Islands 98-1443703 Noble SA Limited Cayman Islands 98-1343368 Noble Services Company LLC Delaware 85-3318770 Noble Services International Limited Cayman Islands 98-1096893 Pacific Drilling S.A.+ Luxembourg 98-1465724 * Each additional registrant is a wholly-owned direct or indirect subsidiary of Noble Finance Company. Unless otherwise indicated, the address, including zip code, and telephone number, including area code, of each additional registrant s principal executive offices is 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. The primary standard industrial classification code number of each of the additional registrants is 1381. The name, address, including zip code, and telephone number, including area code, of the agent for service for each of the additional registrants is Richard B. Barker, 13135 Dairy Ashford, Suite 800, Sugar Land, Texas 77478, telephone (281) 276-6100. ** The address, including zip code, of such registrant s principal executive offices is Dorfstrasse 19a, Baar Switzerland 6340. *** The address, including zip code, of such registrant s principal executive offices is 63 Hadfield & Cross Streets, Werk-en Rust, Georgetown, Demerara, Guyana. The address, including zip code, of such registrant s principal executive offices is Hinna Park J tt v gveien 7, Bygg B, PO Box 370, Stavanger, Norway 4067. The address, including zip code, of such registrant s principal executive offices is Salam Globex Business Center, The Gate- Tower II, Office 807, 8th Level, PO Box 14023, West Bay, Doha, Qatar. + The address, including zip code, of such registrant s principal executive offices is 25B, Boulevard Royal, 2449 Luxembourg, Grand Duchy of Luxembourg. Table of Contents Registration Rights Agreement, RRA Noteholders have certain demand and piggyback registration rights, subject to the limitations set forth in the Registration Rights Agreement. Pursuant to their underwritten offering registration rights, RRA Noteholders have the right to demand that Finco register underwritten offerings of any or all of their Registrable Securities (as defined in the Registration Rights Agreement) pursuant to an effective registration statement, subject to certain conditions, including that the aggregate proceeds expected to be received from such an offering is equal to or greater than $20 million, unless such demand is not pursuant to a shelf registration statement, in which case certain RRA Noteholders may require that Finco register an underwritten offering for an amount that would enable all remaining Registrable Securities to be included in such offering. In addition, the Registration Rights Agreement requires Finco to register for resale such Registrable Securities pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ), including by filing a registration statement on Form S-1 or Form S-3 by the applicable deadline set forth in the Registration Rights Agreement. Finco is filing the registration statement of which this prospectus forms a part pursuant to the foregoing registration obligation. The foregoing description of the Registration Rights Agreement is only a summary and does not purport to be complete, and such description is qualified in its entirety by reference to the full text of the Registration Rights Agreement, which is filed as an exhibit to the registration statement of which this prospectus forms a part. Unless otherwise expressly set forth or as the context otherwise indicates, all financial information and data and accompanying financial statements and corresponding notes, as of and prior to the Effective Date, contained herein reflect the actual historical consolidated results of operations and financial condition of Legacy Noble or Finco, as applicable, for the periods presented and do not give effect to the Plan or any of the transactions contemplated thereby or the adoption of fresh start accounting, which Noble Parent and Finco adopted as of the Effective Date. Accordingly, such financial information may not be representative of Noble Parent s or Finco s, as applicable, performance or financial condition after the Effective Date. Except with respect to such historical financial information and data and accompanying financial statements and corresponding notes or as otherwise suggested by the context, all other information contained herein relates to Noble Parent or Finco, as applicable, following the Effective Date. Table of Contents Emergence from Chapter 11 On the Petition Date, Legacy Noble and certain of its subsidiaries, including Finco, filed the Chapter 11 Cases in the Bankruptcy Court. On September 4, 2020, the Debtors filed with the Bankruptcy Court the Plan, which was subsequently amended on October 8, 2020 and October 13, 2020 and modified on November 18, 2020, and the Disclosure Statement. On September 24, 2020, six additional subsidiaries of Legacy Noble filed the Chapter 11 Cases in the Bankruptcy Court. On November 20, 2020, the Bankruptcy Court entered an order confirming the Plan. In connection with the Chapter 11 Cases and the Plan, on and prior to the Effective Date, Legacy Noble and certain of its subsidiaries effectuated certain restructuring transactions, pursuant to which Legacy Noble formed Noble Parent as an indirect, wholly-owned subsidiary of Legacy Noble and transferred to Noble Parent substantially all of the subsidiaries and other assets of Legacy Noble. On the Effective Date, the Plan became effective in accordance with its terms, the Debtors emerged from the Chapter 11 Cases and Noble Parent became the new parent company. For additional information on the financial restructuring, see Management s Discussion and Analysis of Financial Condition and Results of Operations Executive Overview Recent Events Emergence from Chapter 11. On the Effective Date, pursuant to the Backstop Commitment Agreement and in accordance with the Plan, Noble Parent and Finco consummated the Rights Offering of the Notes and associated Ordinary Shares at an aggregate subscription price of $200 million. On the Effective Date, Finco issued an aggregate principal amount of $216 million of Notes. For a description of the events that occurred on the Effective Date, including the issuance of the Ordinary Shares, the Tranche 1 Warrants, the Tranche 2 Warrants and the Tranche 3 Warrants, see Note 2 Chapter 11 Emergence to the Audited Financial Statements included elsewhere in this prospectus. In accordance with the Plan, Legacy Noble and its remaining subsidiary will in due course be wound down and dissolved in accordance with applicable law. The Bankruptcy Court closed the Chapter 11 Cases with respect to all Debtors other than Legacy Noble, pending its wind down. Pacific Drilling Merger On March 25, 2021, Noble Parent entered into an Agreement and Plan of Merger (the Pacific Drilling Merger Agreement ) with Duke Merger Sub, LLC, a wholly-owned subsidiary of Noble Parent ( Duke Merger Sub ), and Pacific Drilling Company LLC ( Pacific Drilling ), providing for the merger of Duke Merger Sub with and into Pacific Drilling (the Pacific Drilling Merger ), with Pacific Drilling continuing as the surviving company and a wholly-owned subsidiary of Noble Parent. The board of directors of Noble Parent (the Board ) and the board of directors of Pacific Drilling unanimously approved and adopted the Pacific Drilling Merger Agreement. On April 15, 2021, Noble Parent completed the Pacific Drilling Merger with Pacific Drilling. In connection with the Pacific Drilling Merger, and pursuant to the terms and conditions set forth in the Pacific Drilling Merger Agreement, (a) each membership interest in Pacific Drilling (the Membership Interests ) was converted into the right to receive 6.366 Ordinary Shares and (b) each of Pacific Drilling s warrants outstanding immediately prior to the effective time of the Pacific Drilling Merger (the Pacific Warrants ) was converted into the right to receive 1.553 Ordinary Shares. As part of the transaction, Pacific Drilling s equity holders received 16,600,140 Ordinary Shares. Upon completion of the Pacific Drilling Merger, Noble Parent contributed Pacific Drilling to Finco and designated Pacific Drilling and its subsidiaries as unrestricted subsidiaries pursuant to the Revolving Credit Facility (as defined herein) and the Notes. Subsequent to that contribution and designation, Pacific Drilling S.A. was sold to NEC Holdings Limited and became a restricted subsidiary and a subsidiary guarantor of the Revolving Credit Facility and the Notes. Neither Pacific Drilling nor any of its current subsidiaries is a subsidiary guarantor of the Revolving Credit Facility or the Notes, and none of their assets secure the Revolving Credit Facility or the Notes. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 13, 2022 PROSPECTUS NOBLE FINANCE COMPANY 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 This prospectus relates to the resale, from time to time, by the selling securityholders identified in this prospectus or in a subsequent prospectus supplement of up to $404,867,813 aggregate principal amount (assuming interest is paid-in-kind through maturity) of 11%/ 13%/ 15% Senior Secured PIK Toggle Notes due 2028 (the Notes ) previously issued or to be issued by us. We are registering the offer and sale of the Notes pursuant to registration rights we have granted under a registration rights agreement dated as of February 5, 2021. We have agreed to bear all of the expenses incurred in connection with the registration of the Notes. The selling securityholders will pay or assume brokerage commissions and similar charges, if any, incurred in the sale of the Notes. We are not selling any Notes under this prospectus, and we will not receive any proceeds from the sale of the Notes by the selling securityholders under this prospectus. Our registration of the Notes covered by this prospectus does not mean that the selling securityholders will offer or sell any of the Notes. The Notes to which this prospectus relates may be offered and sold from time to time directly by the selling securityholders or alternatively through underwriters, broker dealers, or agents. The selling securityholders will determine at what price they may sell the Notes offered by this prospectus, and such sales may be made at fixed prices, at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices. See Plan of Distribution and Selling Securityholders. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. There is currently no established public trading market for the Notes, and there can be no assurance that a public trading market will develop. Investing in the Notes involves risks. See Risk Factors beginning on page 14 of this prospectus for a discussion of the risks regarding an investment in the Notes. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents ABOUT THIS PROSPECTUS Unless we otherwise indicate, or unless the context requires otherwise, references in this prospectus to Noble, the Company, we, us and our refer collectively to Noble Parent and its consolidated subsidiaries, including Finco, when referring to periods following the Effective Date, and to Legacy Noble and its consolidated subsidiaries, including Finco, when referring to periods prior to the Effective Date. This prospectus is part of a registration statement that we have filed with the Securities and Exchange Commission (the SEC ). This prospectus provides you with a general description of us and the securities that may be offered by the selling securityholders. Because each of the selling securityholders may be deemed to be an underwriter within the meaning of the Securities Act, each time securities are offered by the selling securityholders pursuant to this prospectus, the selling securityholders may be required to provide you with this prospectus and, in certain cases, a prospectus supplement that will contain specific information about the selling securityholders and the terms of the securities being offered. The prospectus supplement may also add to, update or change the information contained in this prospectus. If there is any inconsistency between the information in this prospectus and any prospectus supplement, you should rely on the information in the prospectus supplement. Please carefully read this prospectus and any prospectus supplement, in addition to the information contained in the documents we refer to under the heading Where You Can Find More Information. We have not, and the selling securityholders have not, authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We and the selling securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the selling securityholders are not, making any offer to sell the Notes in any jurisdiction where the offer is not permitted. The information contained in this prospectus is accurate only as of the date on the cover of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Notes. Our business, financial condition, results of operations and prospects may have changed since such date. We have not, and the selling securityholders have not, taken any action to permit this offering or the possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the Notes and the distribution of this prospectus outside the United States. This prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our control. See Risk Factors and Cautionary Statement Regarding Forward-Looking Statements. Table of Contents Business Combination with Maersk Drilling On November 10, 2021, Noble Parent entered into a Business Combination Agreement (the Business Combination Agreement ) with Noble Finco Limited, a private limited company formed under the laws of England and Wales and an indirect, wholly owned subsidiary of Noble Parent ( Topco ), Noble Newco Sub Limited, a Cayman Islands exempted company and a direct, wholly owned subsidiary of Topco ( Merger Sub ), and The Drilling Company of 1972 A/S, a Danish public limited liability company ( Maersk Drilling or, together with its subsidiaries, the Maersk Drilling Group ), pursuant to which, among other things, (i) (x) Noble Parent will merge with and into Merger Sub (the Maersk Drilling Merger ), with Merger Sub surviving the Maersk Drilling Merger as a wholly owned subsidiary of Topco, and (y) the Ordinary Shares will convert into an equivalent number of class A ordinary shares, par value $0.00001 per share, of Topco (the Topco Shares ), and (ii) (x) Topco will make a voluntary tender exchange offer to Maersk Drilling s shareholders as described below (the Offer and, together with the Maersk Drilling Merger and the other transactions contemplated by the Business Combination Agreement, the Business Combination ) and (y) upon the consummation of the Offer, if more than 90% of the issued and outstanding shares of Maersk Drilling, nominal value Danish krone ( DKK ) 10 per share ( Maersk Drilling Shares ), are acquired by Topco, Topco will redeem any Maersk Drilling Shares not exchanged in the Offer by Topco for, at the election of the holder, either Topco Shares or cash (or, for those holders that do not make an election, only cash), under Danish law by way of a compulsory purchase (the Compulsory Purchase ). The Board and the board of directors of Maersk Drilling have unanimously approved and adopted the Business Combination Agreement. The Business Combination is subject to Noble Parent shareholder approval, acceptance of the Offer by holders of at least 80% of Maersk Drilling Shares, merger clearance and other regulatory approvals, listing on the New York Stock Exchange (the NYSE ) and Nasdaq Copenhagen A/S ( Nasdaq Copenhagen ) and other customary conditions. Following the closing of the Business Combination, assuming all of the Maersk Drilling Shares are acquired by Topco through the Offer and no cash is paid by Topco in the Offer, Topco will own all of Noble Parent s and Maersk Drilling s respective businesses and the former shareholders of Noble Parent and former shareholders of Maersk Drilling will each own approximately 50% of the outstanding Topco Shares. Topco will acquire a majority of the Maersk Drilling Shares following the closing of the Offer and it is possible that Topco will directly or indirectly own other assets and conduct other activities in the future at the discretion of Topco management. Topco will be renamed Noble Corporation Plc, will be a public limited company domiciled (tax resident) in the United Kingdom and will be headquartered in Houston, Texas. Topco is expected to have certain management functions relating to the holding of shares, financing, cash management, incentive compensation and other relevant holding company functions. The board of directors of Topco (the Topco Board ) will initially be comprised of seven individuals: three individuals designated by Maersk Drilling (Claus V. Hemmingsen, the current Chairman of Maersk Drilling s board of directors (the Maersk Drilling Board ), Kristin H. Holth and Alastair Maxwell), three individuals designated by Noble Parent (Charles M. (Chuck) Sledge, the current Chairman of the Board of Noble Parent, who will become Chairman of the combined company, Alan J. Hirshberg and Ann D. Pickard) and Robert W. Eifler, the Chief Executive Officer of Noble Parent, who will serve as the Chief Executive Officer of the combined company. Topco will apply to have the Topco Shares listed on the NYSE and on Nasdaq Copenhagen. At the effective time of the Maersk Drilling Merger (the Maersk Drilling Merger Effective Time ), subject to the terms and conditions set forth in the Business Combination Agreement, (i) each Ordinary Share of Noble Parent issued and outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted into one newly and validly issued, fully paid and non-assessable Topco Share, (ii) each ordinary share purchase warrant to purchase Ordinary Shares (each, a Penny Warrant ) outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent the right to acquire Ordinary Shares and will be automatically cancelled, converted into and exchanged for a number of Topco Shares equal to the number of Ordinary Shares Table of Contents underlying such Penny Warrant, rounded to the nearest whole share, and (iii) each Emergence Warrant outstanding immediately prior to the Maersk Drilling Merger Effective Time will be converted automatically into a warrant to acquire a number of Topco Shares equal to the number of Ordinary Shares underlying such Emergence Warrant, with the same terms as were in effect immediately prior to the Maersk Drilling Merger Effective Time under the terms of the applicable warrant agreement (each, a Topco Warrant ). In addition, each award of restricted share units representing the right to receive Ordinary Shares, or value based on the value of Ordinary Shares (each, a Noble RSU Award ) that is outstanding immediately prior to the Maersk Drilling Merger Effective Time will cease to represent a right to acquire Ordinary Shares (or value equivalent to Ordinary Shares) and will be exchanged for restricted share units representing the right to acquire, on the same terms and conditions as were applicable under the Noble RSU Award (including any vesting conditions), that number of Topco Shares equal to the number of Ordinary Shares subject to such Noble RSU Award immediately prior to the Maersk Drilling Merger Effective Time. Subject to the terms and conditions set forth in the Business Combination Agreement, following the approval of certain regulatory filings with the Danish Financial Supervisory Authority (the DFSA ), Topco has agreed to commence the Offer to acquire up to 100% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling, not including any treasury shares held by Maersk Drilling. The Offer is conditioned upon, among other things, holders of at least 80% of the then outstanding Maersk Drilling Shares and voting rights of Maersk Drilling tendering their shares in the Offer (which percentage may be lowered by Topco in its sole discretion to not less than 70%) (the Minimum Acceptance Condition ). In the Offer, Maersk Drilling shareholders may exchange each Maersk Drilling Share for 1.6137 newly and validly issued, fully paid and non-assessable Topco Shares (the Exchange Ratio ), and will have the ability to elect cash consideration for up to $1,000 of their Maersk Drilling Shares (payable in DKK), subject to an aggregate cash consideration cap of $50 million. A Maersk Drilling shareholder electing to receive the cash consideration will receive, as applicable, (i) $1,000 for the applicable portion of their Maersk Drilling Shares, or (ii) the amount corresponding to the total holding of their Maersk Drilling Shares if such holding of Maersk Drilling Shares represents a value of less than $1,000 in the aggregate, subject to any reduction under the cap described in the preceding sentence. A Maersk Drilling shareholder holding Maersk Drilling Shares exceeding a value of $1,000 in the aggregate cannot elect to receive less than $1,000 in cash consideration if the cash consideration in lieu of Topco Shares is elected. Each of Maersk Drilling and Topco will take steps to procure that each Maersk Drilling restricted stock unit award (a Maersk Drilling RSU Award ) that is outstanding immediately prior to the acceptance time of the Offer (the Acceptance Time ) is exchanged, at the Acceptance Time, with the right to receive, on the same terms and conditions as were applicable under the Maersk Drilling RSU Long-Term Incentive Programme for Executive Management 2019 and the Maersk Drilling RSU Long-Term Incentive Programme 2019 (together, the Maersk Drilling LTI ) (including any vesting conditions), that number of Topco Shares equal to the product of (1) the number of Maersk Drilling Shares subject to such Maersk Drilling RSU Award immediately prior to the Acceptance Time and (2) the Exchange Ratio, with any fractional Maersk Drilling Shares rounded to the nearest whole share. Upon such exchange, such Maersk Drilling RSU Awards will cease to represent a right to receive Maersk Drilling Shares (or value equivalent to Maersk Drilling Shares). The Business Combination Agreement contains customary warranties and covenants by Noble Parent, Topco, Merger Sub and Maersk Drilling. The Business Combination Agreement also contains customary pre-closing covenants. Topco s obligation to accept for payment or, subject to any applicable rules and regulations of Denmark, pay for any Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer is subject to certain customary conditions, including, among others, that the Minimum Acceptance Condition shall have been satisfied. Maersk Drilling may require that Topco does not accept for payment or, subject to any applicable rules and regulations of Denmark, pay for the Maersk Drilling Shares that are validly tendered in the Offer and not validly withdrawn prior to the expiration of the Offer if certain Table of Contents customary conditions are not met. Subject to the satisfaction or waiver of the conditions set forth in the Business Combination Agreement, the Business Combination is expected to close in mid-2022. The Business Combination Agreement contains certain termination rights for both Noble Parent and Maersk Drilling. None of the Maersk Drilling assets will secure the Revolving Credit Facility or the Notes upon the closing of the Business Combination. Irrevocable Undertaking Concurrently with the entry into the Business Combination Agreement, APMH Invest A/S ( APMH Invest ), which holds approximately 41.6% of the issued and outstanding Maersk Drilling Shares, entered into an irrevocable undertaking (the Undertaking ) with Noble Parent, Topco and Maersk Drilling, pursuant to which APMH Invest has, among other things, agreed to (a) accept the Offer in respect of the Maersk Drilling Shares that it owns and not withdraw such acceptance; (b) waive the right to receive any cash consideration in the Offer; (c) not vote in favor of any resolution to approve a competing alternative proposal; and (d) subject to certain exceptions, be bound by certain transfer restrictions with respect to the Maersk Drilling Shares that it owns. The Undertaking will lapse if (i) the Business Combination Agreement is terminated in accordance with its terms; (ii) Topco announces that it does not intend to make or proceed with the Business Combination; or (iii) the Offer lapses or is withdrawn and no new, revised or replacement offer is announced within 10 business days. Letters of Intent In addition, certain other Maersk Drilling shareholders, together holding approximately 12% of the issued and outstanding Maersk Drilling Shares, have delivered letters of intent expressing their intention to accept or procure the acceptance of the Offer in respect of the Maersk Drilling Shares that they own. Maersk Drilling Voting Agreements Concurrently with the entry into the Business Combination Agreement, Noble Parent and Maersk Drilling entered into voting agreements (collectively, the Maersk Drilling Voting Agreements ) with certain Noble Parent shareholders (each, a Noble Supporting Shareholder ), which collectively held approximately 53% of the issued and outstanding Ordinary Shares as of the date of the Maersk Drilling Voting Agreements. Pursuant to the Maersk Drilling Voting Agreements, each Noble Supporting Shareholder has, among other things, agreed to (a) consent to and vote (or cause to be voted) its Ordinary Shares (i) in favor of all matters, actions and proposals contemplated by the Business Combination Agreement for which Noble Parent shareholder approval is required and any other matters, actions or proposals required to consummate the Business Combination in accordance with the Business Combination Agreement, and (ii) among other things, against any competing alternative proposal; (b) be bound by certain other covenants and agreements relating to the Business Combination; and (c) subject to certain exceptions, be bound by certain transfer restrictions with respect to a portion of their securities. The Maersk Drilling Voting Agreements will terminate upon the earliest to occur of (x) the date that is ten months from the date of the Maersk Drilling Voting Agreements, (y) the closing date of the Business Combination and (z) the termination of the Business Combination Agreement pursuant to its terms. Notwithstanding the foregoing, each Noble Supporting Shareholder will have the right to terminate the applicable Maersk Drilling Voting Agreement if the Business Combination Agreement has been amended in a manner that materially and adversely affects such Noble Supporting Shareholder (including, without limitation, a reduction of the economic benefits to the Noble Supporting Shareholders contemplated thereby or an extension of the End Date (as defined herein) beyond the date (as such date may be extended) set forth in the Business Combination Agreement). Table of Contents New Relationship Agreement At the closing of the Business Combination, Topco will enter into a Relationship Agreement (the New Relationship Agreement ) with certain funds and accounts (the Existing Noble Investor ) party to the Bankruptcy Relationship Agreement (as defined herein) and APMH Invest, which will set forth certain director designation rights of such Topco shareholders following the closing of the Business Combination. In particular, pursuant to the New Relationship Agreement, each of the Existing Noble Investor and APMH Invest will be entitled to designate (a) two nominees to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns no fewer than 20% of the then outstanding Topco Shares and (b) one nominee to the Topco Board so long as the Existing Noble Investor or APMH Invest, as applicable, owns fewer than 20% but no fewer than 15% of the then outstanding Topco Shares. Each nominee of the Existing Noble Investor and APMH Invest will meet the independence standards of the NYSE with respect to Topco; provided, however, that APMH Invest shall be permitted to have one nominee who does not meet such independence standards so long as such nominee is not an employee of Topco or any of its subsidiaries. Maersk Drilling Merger Registration Rights Agreement At the closing of the Business Combination, Topco will enter into a Registration Rights Agreement (the Maersk Drilling Merger RRA ) with APMH Invest pursuant to which, among other things, and subject to certain limitations set forth therein, APMH Invest will have customary demand and piggyback registration rights. In addition, pursuant to the Maersk Drilling Merger RRA, APMH Invest will have the right to require Topco, subject to certain limitations set forth therein, to effect a distribution of any or all of its Topco Shares by means of an underwritten offering. Topco is not obligated to effect any underwritten offering unless the dollar amount of the securities of APMH Invest to be sold is reasonably likely to result in gross sale proceeds of at least $20 million. Regulatory Approvals Antitrust Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must make filings with and obtain authorizations, approvals or consents from a number of antitrust regulatory authorities, including the United Kingdom Competition and Markets Authority (the UK CMA ) and the Norwegian Competition Authority (Konkurransetilsynet or NCA ). The parties have also agreed, among other things, to (i) file (in draft form where applicable) as promptly as practicable any required filings and/or notifications under applicable antitrust laws or under foreign direct investment laws, with respect to the transactions contemplated by the Business Combination Agreement, including using all reasonable endeavors to submit a merger notice (meldung) to the NCA pursuant to 18 and compliant with 18a of the Competition Act (Konkurranseloven) (Norway) by no later than January 14, 2022 and to submit a merger notice that complies with section 96(2) of the Enterprise Act 2002 (UK) to the UK CMA by no later than February 11, 2022, and use all reasonable endeavors to cause the expiration or termination of any applicable waiting periods and to obtain all necessary approvals or clearances (including clearance from the UK CMA) under any antitrust law or under foreign direct investment laws, and (ii) take, or cause to be taken, all other actions and do, or cause to be done, all other things necessary, proper or advisable to consummate and make effective the transactions contemplated by the Business Combination Agreement, and to avoid or eliminate each and every impediment under any law that may be asserted by any governmental entity with respect to the transactions contemplated by the Business Combination Agreement so as to enable the closing of the Business Combination to occur as soon as reasonably possible (and in any event no later than the End Date). In accordance with the Business Combination Agreement, the parties have submitted the applicable merger notices to the relevant governmental authorities, including the NCA and the UK CMA. The Business Table of Contents Combination has been unconditionally approved by the competition authorities in Brazil, Norway, and the Republic of Trinidad & Tobago. Accordingly, the only outstanding pre-closing merger control clearances are in Angola and the UK. The parties expect the competition authority in Angola to unconditionally approve the Business Combination during April 2022. The merger control process for obtaining clearance in the UK remains ongoing with constructive discussions continuing between Noble Parent, Maersk Drilling, and the UK CMA ahead of the UK CMA expectedly publishing their phase 1 decision on April 22, 2022. While the UK CMA is yet to take its phase 1 decision, the parties expect that it will be necessary to divest certain jackup rigs currently located in the North Sea (the Remedy Rigs ) to obtain conditional antitrust clearance in phase 1 from the UK CMA. The parties currently expect the Remedy Rigs to comprise the Noble Hans Deul , Noble Sam Hartley , Noble Sam Turner , Noble Houston Colbert , and a CJ-70 design drilling rig which, at this point, the parties believe is likely to be the M rsk Innovator , although it is possible the Noble Lloyd Noble could be required to achieve phase 1 clearance. On this basis, the parties have started to examine different options to divest the Remedy Rigs. Though the parties expect that they will be required to divest the Remedy Rigs in order to gain UK CMA clearance, the duration and outcome of the UK CMA review process remains uncertain. Please see Risk Factors Risks Related to the Business Combination with Maersk Drilling The Business Combination is conditioned on the receipt of certain required approvals and governmental and regulatory consents, which, if delayed, not granted or granted with unfavorable conditions, may delay or jeopardize the completion of the Business Combination, result in additional expenditures of money and resources and/or reduce the anticipated benefits of the Business Combination. Foreign Investment Screening Considerations To complete the Business Combination pursuant to the terms of the Business Combination Agreement, Noble Parent and Maersk Drilling must also make filings with and obtain authorizations, approvals or consents pursuant to the UK National Security and Investment Act 2021, and the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021). On January 26, 2022, the Danish Business Authority s (DBA) determined that the Business Combination does not require prior authorization under the Danish Act on Screening of Certain Foreign Direct Investments (Act no. 842 of 10 May 2021) or associated regulations. On March 2, 2022, the Secretary of State of the United Kingdom determined that it would not take any action in relation to the Business Combination in accordance with section 14 of the National Security and Investment Act 2021. No other approvals relating to foreign direct investment are required.
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+prospectus summary. These risks include, but are not limited to: Our public stockholders may not be afforded an opportunity to vote on our proposed initial business combination, which means we may complete our initial business combination even though a majority of our public stockholders do not support such a combination. Your only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash, unless we seek stockholder approval of the initial business combination. If we seek stockholder approval of our initial business combination, our initial stockholders have agreed to vote in favor of such initial business combination, regardless of how our public stockholders vote. The requirement that we complete our initial business combination within the prescribed time frame may give potential target businesses leverage over us in negotiating an initial business combination and may decrease our ability to conduct due diligence on potential business combination targets as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our stockholders. Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the novel coronavirus (COVID-19) pandemic. As the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets. This could increase the cost of our initial business combination and could even result in our inability to find a target or to consummate an initial business combination. If the net proceeds of this offering and the sale of the private placement warrants not being held in the trust account are insufficient to allow us to operate for at least the next 15 months, which is extendable at our option to up to 21 months, as described herein, we may be unable to complete our initial business combination, in which case our public stockholders may only receive $10.20 per share, or less than such amount in certain circumstances, and our warrants will expire worthless. 30 If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share. We may not hold an annual meeting of stockholders until after the consummation of our initial business combination, which could delay the opportunity for our stockholders to elect directors. Because we are neither limited to evaluating a target business in a particular industry sector nor have we selected any specific target businesses with which to pursue our initial business combination, you will be unable to ascertain the merits or risks of any particular target business s operations. Although we have identified general criteria and guidelines that we believe are important in evaluating prospective target businesses and our strategy will be to identify, acquire and build a company in our target investment area, we may enter into our initial business combination with a target that does not meet such criteria and guidelines, and as a result, the target business with which we enter into our initial business combination may not have attributes entirely consistent with our general criteria and guidelines. We are not required to obtain an opinion from an independent investment banking firm or another independent entity, and consequently, you may have no assurance from an independent source that the price we are paying for the business is fair to our stockholders from a financial point of view. We may issue notes or other debt securities, or otherwise incur substantial debt, to complete a business combination, which may adversely affect our leverage and financial condition and thus negatively impact the value of our stockholders investment in us. We may attempt to simultaneously complete business combinations with multiple prospective targets, which may hinder our ability to complete our initial business combination and give rise to increased costs and risks that could negatively impact our operations and profitability. We may attempt to complete our initial business combination with a private company about which little information is available, which may result in a business combination with a company that is not as profitable as we suspected, if at all. We do not have a specified maximum redemption threshold. The absence of such a redemption threshold may make it possible for us to complete our initial business combination with which a substantial majority of our stockholders do not agree. We may be unable to obtain additional financing to complete our initial business combination or to fund the operations and growth of a target business, which could compel us to restructure or abandon a particular business combination. Our initial stockholders may exert a substantial influence on actions requiring a stockholder vote, potentially in a manner that you do not support. We may engage in a business combination with one or more target businesses that have relationships with entities that may be affiliated with our sponsor, officers, directors or existing holders which may raise potential conflicts of interest. Since our sponsor, executive officers and directors will lose their entire investment in us if our initial business combination is not completed, a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination. Our officers and directors will allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial business combination. We may seek business combination opportunities in industries or sectors which may or may not be outside of our management s area of expertise. 31 Our ability to successfully effect our initial business combination and to be successful thereafter will be totally dependent upon the efforts of our key personnel, some of whom may join us following our initial business combination. The loss of key personnel could negatively impact the operations and profitability of our post-combination business. You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. Therefore, to liquidate your investment, you may be forced to sell your public shares or warrants, potentially at a loss. Our sponsor paid an aggregate of $25,000, or approximately $0.009 per founder share and, accordingly, you will experience immediate and substantial dilution from the purchase of the shares of our Class A common stock. We are not registering the shares of Class A common stock issuable upon exercise of the warrants under the Securities Act or any state securities laws at this time, and such registration may not be in place when an investor desires to exercise warrants, thus precluding such investor from being able to exercise its warrants except on a cashless basis. If the issuance of the shares upon exercise of warrants is not registered, qualified or exempt from registration or qualification, the holder of such warrant will not be entitled to exercise such warrant and such warrant may have no value and expire worthless. We may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless. We are a newly formed company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. Past performance by our management team may not be indicative of future performance of an investment in the Company. 32 SUMMARY FINANCIAL DATA The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. September 30, 2021 Actual (unaudited) As Adjusted (unaudited) Balance Sheet Data: Working capital (deficiency)(1) $(208,115) $1,424,527 Total assets(2) $239,097 $103,424,527 Total liabilities(3) $214,570 $- Common stock subject to possible redemption(4) $- $102,000,000 Stockholders equity(5) $24,527 $1,424,527 ____________ (1) The "as adjusted" calculation consists of pro forma cash on hand, excluding funds held in the trust account, as of September 30, 2021 after the closing of the public offering and repayment of actual liabilities. (2) The as adjusted calculation equals $102,000,000 cash held in trust from the proceeds of this offering and the sale of the private placement warrants, plus $1,400,000 of cash held outside the trust account, plus $24,527 of actual stockholder s equity at September 30, 2021. (3) The "as adjusted" calculation assumes the repayment of all payables and accruals at the closing of the public offering. (4) The as adjusted amount equals the redemption value of the Class A common stock. (5) Excludes 10,000,000 shares of common stock issued in connection with our public offering that are subject to redemption. The "as adjusted" calculation equals the "as adjusted" total assets, less the "as adjusted" total liabilities, less the value of shares of common stock that may be redeemed in connection with our initial business combination ($10.20 per share). The as adjusted information gives effect to the issuance of representative shares sale of the units we are offering, and the sale of the private placement warrants, including the application of the related gross proceeds and the payment of the estimated remaining costs from such sale and the repayment of the accrued and other liabilities required to be repaid. The as adjusted total assets amount $102,000,000 to be held in the trust account (or $117,300,000 if the over-allotment option is exercised in full) which, except for limited situations described in this prospectus, will be available to us only upon the consummation of a business combination within the time period described in this prospectus. If a business combination is not so consummated, the trust account, less amounts we are permitted to withdraw from interest earned on the funds in the trust account as described in this prospectus, will be distributed solely to our public stockholders (subject to our obligations under Delaware law to provide for claims of creditors). We will consummate our initial business combination only if we have net tangible assets of at least $5,000,001 either immediately prior to or upon such consummation and, solely if we seek stockholder approval, a majority of the outstanding shares of common stock voted are voted in favor of the business combination. 33 RISK FACTORS An investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together with the other information contained in this prospectus, before making a decision to invest in our units. If any of the following events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. Risks Relating to Our Search For, and Consummation of or Inability to Consummate, a Business Combination Our public stockholders may not be afforded an opportunity to vote on our proposed initial business combination, which means we may complete our initial business combination even though a majority of our public stockholders do not support such a combination. We may choose not to hold a stockholder vote to approve our initial business combination unless the initial business combination would require stockholder approval under applicable law or stock exchange listing requirements or if we decide to hold a stockholder vote for business or other legal reasons. Except as required by law, the decision as to whether we will seek stockholder approval of a proposed initial business combination or will allow stockholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors, such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek stockholder approval. Accordingly, we may complete our initial business combination even if holders of a majority of our public shares do not approve of the initial business combination we complete. Please see the section of this prospectus entitled Proposed Business Stockholders May Not Have the Ability to Approve Our Initial Business Combination for additional information. Your only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash, unless we seek stockholder approval of the initial business combination. At the time of your investment in us, you will not be provided with an opportunity to evaluate the specific merits or risks of our initial business combination. Since our board of directors may complete an initial business combination without seeking stockholder approval, public stockholders may not have the right or opportunity to vote on the initial business combination, unless we seek such stockholder vote. Accordingly, if we do not seek stockholder approval, your only opportunity to affect the investment decision regarding a potential business combination may be limited to exercising your redemption rights within the period of time (which will be at least 20 business days) set forth in our tender offer documents mailed to our public stockholders in which we describe our initial business combination. If we seek stockholder approval of our initial business combination, our initial stockholders have agreed to vote in favor of such initial business combination, regardless of how our public stockholders vote. Pursuant to the letter agreement, our sponsor, initial stockholders, officers and directors have agreed to vote their founder shares, as well as any public shares purchased during or after this offering (including in open market and privately negotiated transactions), in favor of our initial business combination. As a result, in addition to our initial stockholders founder shares, we would need only 625,001, or 6.25%, of the 10,000,000 public shares sold in this offering to be voted in favor of an initial business combination (assuming a quorum is present at the meeting and only a majority of shares are required to approve the business combination) in order to have our initial business combination approved (assuming the over-allotment option is not exercised). Our initial stockholders will own shares representing 20% of our outstanding shares of common stock immediately following the completion of this offering. Accordingly, if we seek stockholder approval of our initial business combination, the agreement by our initial stockholders to vote in favor of our initial business combination will increase the likelihood that we will receive the requisite stockholder approval for such initial business combination. 34 The ability of our public stockholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into an initial business combination with a target. We may seek to enter into an initial business combination agreement with a prospective target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. If too many public stockholders exercise their redemption rights, we would not be able to meet such closing condition and, as a result, would not be able to proceed with the initial business combination. Furthermore, we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions (so that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. Consequently, if accepting all properly submitted redemption requests would cause our net tangible assets to be less than $5,000,001 or such greater amount necessary to satisfy a closing condition as described above, we would not proceed with such redemption and the related business combination and may instead search for an alternate business combination. Prospective targets will be aware of these risks and, thus, may be reluctant to enter into an initial business combination with us. The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure. At the time we enter into an agreement for our initial business combination, we will not know how many stockholders may exercise their redemption rights, and therefore will need to structure the transaction based on our expectations as to the number of shares that will be submitted for redemption. If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the trust account to meet such requirements, or arrange for third party financing. In addition, if a larger number of shares are submitted for redemption than we initially expected, we may need to restructure the transaction to reserve a greater portion of the cash in the trust account or arrange for third party financing. Raising additional third party financing may involve dilutive equity issuances or the incurrence of indebtedness at higher than desirable levels. Furthermore, this dilution would increase to the extent that the anti-dilution provision of the Class B common stock result in the issuance of Class A shares on a greater than one-to-one basis upon conversion of the Class B common stock at the time of our business combination. The above considerations may limit our ability to complete the most desirable business combination available to us or optimize our capital structure. The amount of the fee payable to B. Riley pursuant to the terms of the business combination marketing agreement will not be adjusted for any shares that are redeemed in connection with an initial business combination. The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your stock. If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have a minimum amount of cash at closing, the probability that our initial business combination would be unsuccessful is increased. If our initial business combination is unsuccessful, you would not receive your pro rata portion of the trust account until we liquidate the trust account. If you are in need of immediate liquidity, you could attempt to sell your stock in the open market; however, at such time our stock may trade at a discount to the pro rata amount per share in the trust account. In either situation, you may suffer a material loss on your investment or lose the benefit of funds expected in connection with our redemption until we liquidate or you are able to sell your stock in the open market. 35 The requirement that we complete our initial business combination within the prescribed time frame may give potential target businesses leverage over us in negotiating an initial business combination and may decrease our ability to conduct due diligence on potential business combination targets as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our stockholders. Any potential target business with which we enter into negotiations concerning an initial business combination will be aware that we must complete our initial business combination within 15 month period, which is extendable at our option to up to 21 months, as described herein. Consequently, such target business may obtain leverage over us in negotiating an initial business combination, knowing that if we do not complete our initial business combination with that particular target business, we may be unable to complete our initial business combination with any target business. This risk will increase as we get closer to the timeframe described above. In addition, we may have limited time to conduct due diligence and may enter into our initial business combination on terms that we would have rejected upon a more comprehensive investigation. We may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public stockholders may only receive $10.20 per share, or less than such amount in certain circumstances, and our warrants will expire worthless. Our amended and restated certificate of incorporation provides that we must complete our initial business combination within 15 month period, which is extendable at our option to up to 21 months, as described herein. We may not be able to find a suitable target business and complete our initial business combination within such time period. If we have not completed our initial business combination within such time period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. In such case, our public stockholders may only receive $10.20 per share, and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than $10.20 per share on the redemption of their shares. See If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share and other risk factors below. Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the novel coronavirus (COVID-19) pandemic and the status of debt and equity markets. In March 2020, the World Health Organization declared novel coronavirus disease 2019 (COVID-19) a global pandemic. The COVID-19 pandemic has negatively impacted the global economy, disrupted global supply chains, lowered equity market valuations, created significant volatility and disruption in financial markets, and increased unemployment levels, all of which may become heightened concerns upon a second wave of infection or future developments. In addition, the pandemic has resulted in temporary closures of many businesses and the institution of social distancing and sheltering in place requirements in many states and communities. The COVID-19 pandemic has and a significant outbreak of other infectious diseases could result in a widespread health crisis that could adversely affect the economies and financial markets worldwide, and the business of any potential partner business with which we consummate a business combination could be materially and adversely affected. 36 Furthermore, we may be unable to complete a business combination if concerns relating to COVID-19 continue to restrict travel, limit the ability to have meetings with potential investors or the partner business s personnel, vendors and services providers are unavailable to negotiate and consummate a transaction in a timely manner. The extent to which COVID-19 impacts our search for a business combination will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others. If the disruptions posed by COVID-19 or other matters of global concern continue for an extensive period of time, our ability to consummate a business combination, or the operations of a partner business with which we ultimately consummate a business combination, may be materially adversely affected. In addition, our ability to consummate a transaction may be dependent on the ability to raise equity and debt financing which may be impacted by COVID-19 and other events, including as a result of increased market volatility, decreased market liquidity and third-party financing being unavailable on terms acceptable to us or at all. Finally, a sustained or prolonged COVID-19 resurgence, such as the new Omicron variant, may also have the effect of heightening many of the other risks described in this Risk Factors section, such as those related to the market for our securities. We may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public stockholders may only receive $10.20 per share, or less than such amount in certain circumstances, and our warrants will expire worthless. Our sponsor, officers and directors have agreed that we must complete our initial business combination within 15 month period, which is extendable at our option to up to 21 months, as described herein. We may not be able to find a suitable target business and complete our initial business combination within such time period. Our ability to complete our initial business combination may be negatively impacted by general market conditions, volatility in the capital and debt markets and the other risks described herein. For example, the COVID-19 pandemic continues both in the United States and globally and, while the extent of the impact of the outbreak on us will depend on future developments, it could limit our ability to complete our initial business combination, including as a result of increased market volatility, decreased market liquidity and third-party financing being unavailable on terms acceptable to us or at all. Additionally, the continued COVID-19 pandemic may negatively impact businesses we may seek to acquire. If we have not completed our initial business combination within such 18-month period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, subject to lawfully available funds therefor, redeem 100% of the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law, in which case our public stockholders may only receive $10.20 per share, or less than such amount in certain circumstances, and our warrants will expire worthless. See If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share and other risk factors herein. As the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets. This could increase the cost of our initial business combination and could even result in our inability to find a target or to consummate an initial business combination. In recent years, the number of special purpose acquisition companies that have been formed has increased substantially. Many potential targets for special purpose acquisition companies have already entered into an initial business combination, and there are still many companies preparing for an initial public offering. As a result, at times, fewer attractive targets may be available to consummate an initial business combination. In addition, because there are more special purpose acquisition companies seeking to enter into an initial business combination with available targets, the competition for available targets with attractive fundamentals or business models may increase, which could cause target companies to demand improved financial terms. Attractive deals could also become scarcer for other reasons, such as economic or industry sector downturns, geopolitical tensions, or increases in the cost of additional capital needed to close business combinations or operate targets post-business combination. This could increase the cost of, delay or otherwise complicate or frustrate our ability to find and consummate an initial business combination, and may result in our inability to consummate an initial business combination on terms favorable to our investors. 37 If we seek stockholder approval of our initial business combination, our sponsor, initial stockholders, directors, officers, advisors and their affiliates may elect to purchase shares or warrants from public stockholders, which may influence a vote on a proposed initial business combination and reduce the public float of our Class A common stock. If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, initial stockholders, directors, officers, advisors or their affiliates may purchase shares or public warrants or a combination thereof in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination, although they are under no obligation to do so. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds in the trust account will be used to purchase shares or public warrants in such transactions. Such a purchase may include a contractual acknowledgement that such stockholder, although still the record holder of our shares is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights. In the event that our sponsor, initial stockholders, directors, officers, advisors or their affiliates purchase shares in privately negotiated transactions from public stockholders who have already elected to exercise their redemption rights, such selling stockholders would be required to revoke their prior elections to redeem their shares. The purpose of such purchases could be to vote such shares in favor of the initial business combination and thereby increase the likelihood of obtaining stockholder approval of the initial business combination, or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. In addition, if such purchases are made, the public float of our Class A common stock or public warrants and the number of beneficial holders of our securities may be reduced, possibly making it difficult to obtain or maintain the quotation, listing or trading of our securities on a national securities exchange. If a stockholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for tendering its shares, such shares may not be redeemed. We will comply with the tender offer rules or proxy rules, as applicable, when conducting redemptions in connection with our initial business combination. Despite our compliance with these rules, if a stockholder fails to receive our tender offer or proxy materials, as applicable, such stockholder may not become aware of the opportunity to redeem its shares. In addition, proxy materials or tender offer documents, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will describe the various procedures that must be complied with in order to validly tender or redeem public shares. For example, we may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to either tender their certificates to our transfer agent prior to the date set forth in the tender offer documents mailed to such holders, or up to two business days prior to the vote on the proposal to approve the initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically. In the event that a stockholder fails to comply with these or any other procedures, its shares may not be redeemed. See the section of this prospectus entitled Proposed Business Redemption Rights for Public Stockholders upon Completion of our Initial Business Combination Tendering Stock Certificates in Connection with a Tender Offer or Redemption Rights. 38 You will not be entitled to protections normally afforded to investors of many other blank check companies. Since the net proceeds of this offering and the sale of the private placement warrants are intended to be used to complete an initial business combination with a target business that has not been identified, we may be deemed to be a blank check company under the United States securities laws. However, because we will have net tangible assets in excess of $5,000,001 upon the successful completion of this offering and the sale of the private placement warrants and will file a Current Report on Form 8-K, including an audited balance sheet demonstrating this fact, we are exempt from rules promulgated by the SEC to protect investors in blank check companies, such as Rule 419. Accordingly, investors will not be afforded the benefits or protections of those rules. Among other things, this means our units will be immediately tradable and we will have a longer period of time to complete our initial business combination than do companies subject to Rule 419. Moreover, if this offering were subject to Rule 419, that rule would prohibit the release of any interest earned on funds held in the trust account to us unless and until the funds in the trust account were released to us in connection with our completion of an initial business combination. For a more detailed comparison of our offering to offerings that comply with Rule 419, please see the section of this prospectus entitled Proposed Business Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419. If we seek stockholder approval of our initial business combination and we do not conduct redemptions pursuant to the tender offer rules, and if you or a group of stockholders are deemed to hold in excess of 15% of our Class A common stock, you will lose the ability to redeem all such shares in excess of 15% of our Class A common stock. If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation provides that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect to more than an aggregate of 15% of the shares sold in this offering without our prior consent, which we refer to as the Excess Shares. However, we would not be restricting our stockholders ability to vote all of their shares (including Excess Shares) for or against our initial business combination. Your inability to redeem the Excess Shares will reduce your influence over our ability to complete our initial business combination and you could suffer a material loss on your investment in us if you sell Excess Shares in open market transactions. Additionally, you will not receive redemption distributions with respect to the Excess Shares if we complete our initial business combination. And as a result, you will continue to hold that number of shares exceeding 15% and, in order to dispose of such shares, would be required to sell your stock in open market transactions, potentially at a loss. 39 Because of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share on our redemption of our public shares, or less than such amount in certain circumstances, and our warrants will expire worthless. We expect to encounter intense competition from other entities having a business objective similar to ours, including private investors (which may be individuals or investment partnerships), other blank check companies and other entities competing for the types of businesses we intend to acquire. Many of these individuals and entities are well-established and have extensive experience in identifying and effecting, directly or indirectly, acquisitions of companies operating in or providing services to various industries. Many of these competitors possess greater technical, human and other resources or more industry knowledge than we do, and our financial resources will be relatively limited when contrasted with those of many of these competitors. While we believe there are numerous target businesses we could potentially acquire with the net proceeds of this offering and the sale of the private placement warrants, our ability to compete with respect to the acquisition of certain target businesses that are sizable will be limited by our available financial resources. This inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target businesses. Furthermore, because we are obligated to pay cash for the shares of Class A common stock which our public stockholders redeem in connection with our initial business combination, target companies will be aware that this may reduce the resources available to us for our initial business combination. This may place us at a competitive disadvantage in successfully negotiating an initial business combination. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share on the liquidation of our trust account and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than $10.20 per share upon our liquidation. See If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share and other risk factors below. If the net proceeds of this offering and the sale of the private placement warrants not being held in the trust account are insufficient to allow us to operate for at least the next 15 months, which is extendable at our option to up to 21 months, as described herein, we may be unable to complete our initial business combination, in which case our public stockholders may only receive $10.20 per share, or less than such amount in certain circumstances, and our warrants will expire worthless. The funds available to us outside of the trust account may not be sufficient to allow us to operate for at least the next 15 months, which is extendable at our option to up to 21 months, as described herein, assuming that our initial business combination is not completed during that time. We believe that, upon the closing of this offering, the funds available to us outside of the trust account will be sufficient to allow us to operate for at least the next 15 months, which is extendable at our option to up to 21 months, as described herein; however, we cannot assure you that our estimate is accurate. Of the funds available to us, we could use a portion of the funds available to us to pay fees to consultants to assist us with our search for a target business. We could also use a portion of the funds as a down payment or to fund a no-shop provision (a provision in letters of intent or merger agreements designed to keep target businesses from shopping around for transactions with other companies on terms more favorable to such target businesses) with respect to a particular proposed initial business combination, although we do not have any current intention to do so. If we entered into a letter of intent or merger agreement where we paid for the right to receive exclusivity from a target business and were subsequently required to forfeit such funds (whether as a result of our breach or otherwise), we might not have sufficient funds to continue searching for, or conduct due diligence with respect to, a target business. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share on the liquidation of our trust account and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than $10.20 per share upon our liquidation. See If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share and other risk factors below. 40 If the net proceeds of this offering and the sale of the private placement warrants not being held in the trust account are insufficient, it could limit the amount available to fund our search for a target business or businesses and complete our initial business combination and we will depend on loans from our sponsor or management team to fund our search for an initial business combination, to pay our franchise and income taxes and to complete our initial business combination. If we are unable to obtain these loans, we may be unable to complete our initial business combination. Of the net proceeds of this offering and the sale of the private placement warrants, only approximately $1,400,000 will be available to us initially outside the trust account to fund our working capital requirements. In the event that our offering expenses exceed our estimate of $600,000, we may fund such excess with funds not to be held in the trust account. In such case, the amount of funds we intend to be held outside the trust account would decrease by a corresponding amount. The amount held in the trust account will not be impacted as a result of such increase or decrease. Conversely, in the event that the offering expenses are less than our estimate of $600,000, the amount of funds we intend to be held outside the trust account would increase by a corresponding amount. If we are required to seek additional capital, we would need to borrow funds from our sponsor, management team or other third parties to operate or may be forced to liquidate. None of our sponsor, members of our management team nor any of their affiliates is under any obligation to advance funds to us in such circumstances. Any such advances would be repaid only from funds held outside the trust account or from funds released to us upon completion of our initial business combination. Up to $1,500,000 of such working capital loans may be convertible into private placement-equivalent warrants at a price of $1.00 per warrant, at the option of the lender. Prior to the completion of our initial business combination, we do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our trust account. If we are unable to obtain these loans, we may be unable to complete our initial business combination. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the trust account. Consequently, our public stockholders may only receive approximately $10.20 per share on our redemption of our public shares, and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than $10.20 per share on the redemption of their shares. See If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share and other risk factors below. If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share. Our placing of funds in the trust account may not protect those funds from third-party claims against us. Although we will seek to have all vendors, service providers, prospective target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our public stockholders, such parties may not execute such agreements, or even if they execute such agreements they may not be prevented from bringing claims against the trust account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain advantage with respect to a claim against our assets, including the funds held in the trust account. If any third party refuses to execute an agreement waiving such claims to the monies held in the trust account, our management will perform an analysis of the alternatives available to it and will only enter into an agreement with a third party that has not executed a waiver if management believes that such third party s engagement would be significantly more beneficial to us than any alternative. Marcum, LLP, our independent registered public accounting firm, and the underwriters of the offering, will not execute agreements with us waiving such claims to the monies held in the trust account. Examples of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third party consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver. In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason. Upon redemption of our public shares, if we are unable to complete our initial business combination within the prescribed timeframe, or upon the exercise of a redemption right in connection with our initial business combination, we will be required to provide for payment of claims of creditors that were not waived that may be brought against us within the 10 years following redemption. Accordingly, the per-share redemption amount received by public stockholders could be less than the $10.20 per share initially held in the trust account, due to claims of such creditors. Pursuant to the letter agreement, the form of which is filed as Exhibit 10.1 to the registration statement of which this prospectus forms a part, our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business with which we have entered into a written letter of intent, confidentiality or similar agreement or business combination agreement, reduce the amount of funds in the trust account to below the lesser of (i) $10.20 per public share, and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.20 per share due to reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. However, we have not asked our sponsor to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that our sponsor s only assets are securities of our company. Therefore, we cannot assure you that our sponsor would be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses. 41 Our directors may decide not to enforce the indemnification obligations of our sponsor, resulting in a reduction in the amount of funds in the trust account available for distribution to our public stockholders. In the event that the proceeds in the trust account are reduced below the lesser of (i) $10.20 per share, and (ii) the actual amount per share held in the trust account as of the date of the liquidation of the trust account if less than $10.20 per share due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes, and our sponsor asserts that it is unable to satisfy its obligations or that it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take legal action against our sponsor to enforce its indemnification obligations. While we currently expect that our independent directors would take legal action on our behalf against our sponsor to enforce its indemnification obligations to us, it is possible that our independent directors in exercising their business judgment and subject to their fiduciary duties may choose not to do so in any particular instance if, for example, the cost of such legal action is deemed by the independent directors to be too high relative to the amount recoverable or if the independent directors determine that a favorable outcome is not likely. If our independent directors choose not to enforce these indemnification obligations, the amount of funds in the trust account available for distribution to our public stockholders may be reduced below $10.20 per share. Changes in the market for directors and officers liability insurance could make it more difficult and more expensive for us to negotiate and complete an initial business combination. In recent months, the market for directors and officers liability insurance for special purpose acquisition companies has changed. Fewer insurance companies are offering quotes for directors and officers liability coverage, the premiums charged for such policies have generally increased and the terms of such policies have generally become less favorable. There can be no assurance that these trends will not continue. The increased cost and decreased availability of directors and officers liability insurance could make it more difficult and more expensive for us to negotiate an initial business combination. In order to obtain directors and officers liability insurance or modify its coverage as a result of becoming a public company, the post-business combination entity might need to incur greater expense, accept less favorable terms or both. However, any failure to obtain adequate directors and officers liability insurance could have an adverse impact on the post-business combination s ability to attract and retain qualified officers and directors. In addition, even after we were to complete an initial business combination, our directors and officers could still be subject to potential liability from claims arising from conduct alleged to have occurred prior to the initial business combination. As a result, in order to protect our directors and officers, the post-business combination entity may need to purchase additional insurance with respect to any such claims ( run-off insurance ). The need for run-off insurance would be an added expense for the post-business combination entity, and could interfere with or frustrate our ability to consummate an initial business combination on terms favorable to our investors. We may not have sufficient funds to satisfy indemnification claims of our directors and executive officers. We have agreed to indemnify our officers and directors to the fullest extent permitted by law. However, our officers and directors have agreed to waive any right, title, interest or claim of any kind in or to any monies in the trust account and to not seek recourse against the trust account for any reason whatsoever. Accordingly, any indemnification provided will be able to be satisfied by us only if (i) we have sufficient funds outside of the trust account or (ii) we consummate an initial business combination. Our obligation to indemnify our officers and directors may discourage stockholders from bringing a lawsuit against our officers or directors for breach of their fiduciary duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against our officers and directors, even though such an action, if successful, might otherwise benefit us and our stockholders. Furthermore, a stockholder s investment may be adversely affected to the extent we pay the costs of settlement and damage awards against our officers and directors pursuant to these indemnification provisions. 42 If, after we distribute the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and we and our board may be exposed to claims of punitive damages. If, after we distribute the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a preferential transfer or a fraudulent conveyance. As a result, a bankruptcy court could seek to recover all amounts received by our stockholders. In addition, our board of directors may be viewed as having breached its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing itself and us to claims of punitive damages, by paying public stockholders from the trust account prior to addressing the claims of creditors. If, before distributing the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our stockholders and the per-share amount that would otherwise be received by our stockholders in connection with our liquidation may be reduced. If, before distributing the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our stockholders. To the extent any bankruptcy claims deplete the trust account, the per-share amount that would otherwise be received by our stockholders in connection with our liquidation may be reduced. If we are deemed to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted, which may make it difficult for us to complete our initial business combination. If we are deemed to be an investment company under the Investment Company Act, our activities may be restricted, including: restrictions on the nature of our investments; and restrictions on the issuance of securities, each of which may make it difficult for us to complete our initial business combination. In addition, we may have imposed upon us burdensome requirements, including: registration as an investment company; adoption of a specific form of corporate structure; and reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations. In order not to be regulated as an investment company under the Investment Company Act, unless we can qualify for an exclusion, we must ensure that we are engaged primarily in a business other than investing, reinvesting or trading in securities and that our activities do not include investing, reinvesting, owning, holding or trading investment securities constituting more than 40% of our total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis. Our business will be to identify and complete an initial business combination and thereafter to operate the post-transaction business or assets for the long term. We do not plan to buy businesses or assets with a view to resale or profit from their resale. We do not plan to buy unrelated businesses or assets or to be a passive investor. 43 We do not believe that our anticipated principal activities will subject us to the Investment Company Act. To this end, the proceeds held in the trust account may only be invested in United States government securities within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S. government treasury obligations. Pursuant to the trust agreement, the trustee is not permitted to invest in other securities or assets. By restricting the investment of the proceeds to these instruments, and by having a business plan targeted at acquiring and growing businesses for the long term (rather than on buying and selling businesses in the manner of a merchant bank or private equity fund), we intend to avoid being deemed an investment company within the meaning of the Investment Company Act. This offering is not intended for persons who are seeking a return on investments in government securities or investment securities. The trust account is intended as a holding place for funds pending the earliest to occur of: (i) the completion of our initial business combination; (ii) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 15 months from the closing of this offering, which is extendable at our option to up to 21 months, as described herein, or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity; or (iii) absent an initial business combination within 15 months from the closing of this offering, which is extendable at our option to up to 21 months from the closing of this offering, as described herein, our return of the funds held in the trust account to our public stockholders as part of our redemption of the public shares. If we do not invest the proceeds as discussed above, we may be deemed to be subject to the Investment Company Act. If we were deemed to be subject to the Investment Company Act, compliance with these additional regulatory burdens would require additional expenses for which we have not allotted funds and may hinder our ability to complete an initial business combination or may result in our liquidation. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share on the liquidation of our trust account and our warrants will expire worthless. Changes in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, including our ability to negotiate and complete our initial business combination and results of operations. We are subject to laws and regulations enacted by national, regional and local governments. In particular, we will be required to comply with certain SEC and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consuming and costly. Those laws and regulations and their interpretation and application may also change from time to time and those changes could have a material adverse effect on our business, investments and results of operations. In addition, a failure to comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business, including our ability to negotiate and complete our initial business combination and results of operations. Our stockholders may be held liable for claims by third parties against us to the extent of distributions received by them upon redemption of their shares. Under the DGCL, stockholders may be held liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution. The pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination within 15 months, which is extendable at our option to up to 21 months, as described herein, from the closing of this offering may be considered a liquidating distribution under Delaware law. If a corporation complies with certain procedures set forth in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during which any third-party claims can be brought against the corporation, a 90-day period during which the corporation may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are made to stockholders, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would be barred after the third anniversary of the dissolution. However, it is our intention to redeem our public shares as soon as reasonably possible following the 12th month (or up to the 18th month) from the closing of this offering in the event we do not complete our initial business combination and, therefore, we do not intend to comply with the foregoing procedures. 44 Because we will not be complying with Section 280, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us at such time that will provide for our payment of all existing and pending claims or claims that may be potentially brought against us within the 10 years following our dissolution. However, because we are a blank check company, rather than an operating company, and our operations will be limited to searching for prospective target businesses to acquire, the only likely claims to arise would be from our vendors (such as lawyers, investment bankers, etc.) or prospective target businesses. If our plan of distribution complies with Section 281(b) of the DGCL, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would likely be barred after the third anniversary of the dissolution. We cannot assure you that we will properly assess all claims that may be potentially brought against us. As such, our stockholders could potentially be liable for any claims to the extent of distributions received by them (but no more) and any liability of our stockholders may extend beyond the third anniversary of such date. Furthermore, if the pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination within 15 months from the closing of this offering, which is extendable at our option to up to 21 months, as described herein, is not considered a liquidating distribution under Delaware law and such redemption distribution is deemed to be unlawful (potentially due to the imposition of legal proceedings that a party may bring or due to other circumstances that are currently unknown), then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidating distribution. We may not hold an annual meeting of stockholders until after the consummation of our initial business combination, which could delay the opportunity for our stockholders to elect directors. In accordance with Nasdaq corporate governance requirements, we are not required to hold an annual meeting until no later than one year after our first fiscal year end following our listing on Nasdaq. Under Section 211(b) of the DGCL, we are, however, required to hold an annual meeting of stockholders for the purposes of electing directors in accordance with our bylaws unless such election is made by written consent in lieu of such a meeting. We may not hold an annual meeting of stockholders to elect new directors prior to the consummation of our initial business combination, and thus we may not be in compliance with Section 211(b) of the DGCL, which requires an annual meeting. Therefore, if our stockholders want us to hold an annual meeting prior to the consummation of our initial business combination, they may attempt to force us to hold one by submitting an application to the Delaware Court of Chancery in accordance with Section 211(c) of the DGCL. The grant of registration rights to our initial stockholders may make it more difficult to complete our initial business combination, and the future exercise of such rights may adversely affect the market price of our Class A common stock. Pursuant to an agreement to be entered into concurrently with the issuance and sale of the securities in this offering, our initial stockholders and their permitted transferees can demand that we register the private placement warrants, the shares of Class A common stock issuable upon exercise of the private placement warrants and upon conversion of the founder shares held, or to be held, by them and holders of securities that may be issued upon conversion of working capital loans may demand that we register such warrants or the Class A common stock issuable upon conversion or exercise of such warrants. We will bear the cost of registering these securities. The registration and availability of such a significant number of securities for trading in the public market may have an adverse effect on the market price of our Class A common stock. In addition, the existence of the registration rights may make our initial business combination more costly or difficult to conclude. This is because the stockholders of the target business may increase the equity stake they seek in the combined entity or ask for more cash consideration to offset the negative impact on the market price of our Class A common stock that is expected when the securities owned by our initial stockholders or holders of working capital loans or their respective permitted transferees are registered. 45 Because we are neither limited to evaluating a target business in a particular industry sector nor have we selected any specific target businesses with which to pursue our initial business combination, you will be unable to ascertain the merits or risks of any particular target business s operations. We intend to focus our search on established, technology focused businesses, except that we are not, under our amended and restated certificate of incorporation, be permitted to effectuate our initial business combination with another blank check company or similar company with nominal operations. Because we have not yet selected or approached any specific target business with respect to a business combination, there is no basis to evaluate the possible merits or risks of any particular target business s operations, results of operations, cash flows, liquidity, financial condition or prospects. To the extent we complete our initial business combination, we may be affected by numerous risks inherent in the business operations with which we combine. For example, if we combine with a financially unstable business or an entity lacking an established record of sales or earnings, we may be affected by the risks inherent in the business and operations of a financially unstable or a development stage entity. Although our officers and directors will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all of the significant risk factors or that we will have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability to control or reduce the chances that those risks will adversely impact a target business. We also cannot assure you that an investment in our units will ultimately prove to be more favorable to investors than a direct investment, if such opportunity were available, in a business combination target. Accordingly, any stockholders who choose to remain stockholders following our initial business combination could suffer a reduction in the value of their securities. Such stockholders are unlikely to have a remedy for such reduction in value unless they are able to successfully claim that the reduction was due to the breach by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they are able to successfully bring a private claim under securities laws that the proxy solicitation or tender offer materials, as applicable, relating to the business combination contained an actionable material misstatement or material omission. Although we have identified general criteria and guidelines that we believe are important in evaluating prospective target businesses, we may enter into our initial business combination with a target that does not meet such criteria and guidelines, and as a result, the target business with which we enter into our initial business combination may not have attributes entirely consistent with our general criteria and guidelines. Although we have identified general criteria and guidelines for evaluating prospective target businesses, it is possible that a target business with which we enter into our initial business combination will not have all of these positive attributes. If we complete our initial business combination with a target that does not meet some or all of these guidelines, such combination may not be as successful as a combination with a business that does meet all of our general criteria and guidelines. In addition, if we announce a prospective business combination with a target that does not meet our general criteria and guidelines, a greater number of stockholders may exercise their redemption rights, which may make it difficult for us to meet any closing condition with a target business that requires us to have a minimum net worth or a certain amount of cash. In addition, if stockholder approval of the transaction is required by law, or we decide to obtain stockholder approval for business or other legal reasons, it may be more difficult for us to attain stockholder approval of our initial business combination if the target business does not meet our general criteria and guidelines. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share on the liquidation of our trust account and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than $10.20 per share on the redemption of their shares. See If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share and other risk factors below. We are not required to obtain an opinion from an independent investment banking firm or from an independent accounting firm, and consequently, you may have no assurance from an independent source that the price we are paying for the business is fair to our company from a financial point of view. Unless we complete our initial business combination with an affiliated entity or our board cannot independently determine the fair market value of the target business or businesses, we are not required to obtain an opinion from an independent investment banking firm that is a member of FINRA or from an independent accounting firm that the price we are paying is fair to our company from a financial point of view. If no opinion is obtained, our stockholders will be relying on the judgment of our board of directors, who will determine fair market value based on standards generally accepted by the financial community. Such standards used will be disclosed in our proxy materials or tender offer documents, as applicable, related to our initial business combination. 46 Resources could be wasted in researching business combinations that are not completed, which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share, or less than such amount in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. We anticipate that the investigation of each specific target business and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments will require substantial management time and attention and substantial costs for accountants, attorneys, consultants and others. If we decide not to complete a specific initial business combination, the costs incurred up to that point for the proposed transaction likely would not be recoverable. Furthermore, if we reach an agreement relating to a specific target business, we may fail to complete our initial business combination for any number of reasons including those beyond our control. Any such event will result in a loss to us of the related costs incurred which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share on the liquidation of our trust account and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than $10.20 per share on the redemption of their shares. See If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share and other risk factors below. We may only be able to complete one business combination with the proceeds of this offering and the sale of the private placement warrants, which will cause us to be solely dependent on a single business which may have a limited number of services and limited operating activities. This lack of diversification may negatively impact our operating results and profitability. Of the net proceeds from this offering and the sale of the private placement warrants, $102,000,000 (or $117,300,000 if the underwriters over-allotment option is exercised in full) will be available to complete our initial business combination and pay related fees and expenses. We may effectuate our initial business combination with a single target business or multiple target businesses simultaneously or within a short period of time. However, we may not be able to effectuate our initial business combination with more than one target business because of various factors, including the existence of complex accounting issues and the requirement that we prepare and file pro forma financial statements with the SEC that present operating results and the financial condition of several target businesses as if they had been operated on a combined basis. By completing our initial business combination with only a single entity, our lack of diversification may subject us to numerous economic, competitive and regulatory developments. Further, we would not be able to diversify our operations or benefit from the possible spreading of risks or offsetting of losses, unlike other entities which may have the resources to complete several business combinations in different industries or different areas of a single industry. In addition, we intend to focus our search for an initial business combination in a single industry. Accordingly, the prospects for our success may be: solely dependent upon the performance of a single business, property or asset, or dependent upon the development or market acceptance of a single or limited number of products, processes or services. This lack of diversification may subject us to numerous economic, competitive and regulatory risks, any or all of which may have a substantial adverse impact upon the particular industry in which we may operate subsequent to our initial business combination. 47 We may attempt to simultaneously complete business combinations with multiple prospective targets, which may hinder our ability to complete our initial business combination and give rise to increased costs and risks that could negatively impact our operations and profitability. If we determine to simultaneously acquire several businesses that are owned by different sellers, we will need for each of such sellers to agree that our purchase of its business is contingent on the simultaneous closings of the other business combinations, which may make it more difficult for us, and delay our ability, to complete our initial business combination. We do not, however, intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. With multiple business combinations, we could also face additional risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence investigations (if there are multiple sellers) and the additional risks associated with the subsequent assimilation of the operations and services or products of the acquired companies in a single operating business. If we are unable to adequately address these risks, it could negatively impact our profitability and results of operations. We may attempt to complete our initial business combination with a private company about which little information is available, which may result in an initial business combination with a company that is not as profitable as we suspected, if at all. In pursuing our initial business combination strategy, we may seek to effectuate our initial business combination with a privately held company. Very little public information generally exists about private companies, and we could be required to make our decision on whether to pursue a potential initial business combination on the basis of limited information, which may result in an initial business combination with a company that is not as profitable as we suspected, if at all. We do not have a specified maximum redemption threshold. The absence of such a redemption threshold may make it possible for us to complete an initial business combination with which a substantial majority of our stockholders do not agree. Our amended and restated certificate of incorporation does not provide a specified maximum redemption threshold, except that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions (such that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. As a result, we may be able to complete our initial business combination even though a substantial majority of our public stockholders do not agree with the transaction and have redeemed their shares or, if we seek stockholder approval of our initial business combination and do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, have entered into privately negotiated agreements to sell their shares to our sponsor, initial stockholders, officers, directors, advisors or their affiliates. In the event the aggregate cash consideration we would be required to pay for all shares of Class A common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will not complete the initial business combination or redeem any shares, all shares of Class A common stock submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate business combination. 48 In order to effectuate an initial business combination, blank check companies have, in the recent past, amended various provisions of their charters and other governing instruments, including their warrant agreements. We cannot assure you that we will not seek to amend our amended and restated certificate of incorporation or governing instruments in a manner that will make it easier for us to complete our initial business combination that our stockholders may not support. In order to effectuate an initial business combination, blank check companies have, in the recent past, amended various provisions of their charters and modified governing instruments, including their warrant agreements. For example, blank check companies have amended the definition of business combination, increased redemption thresholds and extended the time to consummate an initial business combination and, with respect to their warrants, amended their warrant agreements to require the warrants to be exchanged for cash and/or other securities. Amending our amended and restated certificate of incorporation requires the approval of holders of 65% of our common stock, and amending our warrant agreement will require a vote of holders of at least 65% of the public warrants. In addition, our amended and restated certificate of incorporation requires us to provide our public stockholders with the opportunity to redeem their public shares for cash if we propose an amendment to our amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 15 months from the closing of this offering, which is extendable at our option to up to 21 months, as described herein, or (ii) with respect to any other provision relating to stockholders rights or pre-initial business combination activity. To the extent any such amendments would be deemed to fundamentally change the nature of any securities offered through this registration statement, we would register, or seek an exemption from registration for, the affected securities. We cannot assure you that we will not seek to amend our charter or governing instruments or extend the time to consummate an initial business combination in order to effectuate our initial business combination. The provisions of our amended and restated certificate of incorporation that relate to our pre-business combination activity (and corresponding provisions of the agreement governing the release of funds from our trust account), including an amendment to permit us to withdraw funds from the trust account such that the per share amount investors will receive upon any redemption or liquidation is substantially reduced or eliminated, may be amended with the approval of holders of 65% of our common stock, which is a lower amendment threshold than that of some other blank check companies. It may be easier for us, therefore, to amend our amended and restated certificate of incorporation and the trust agreement to facilitate the completion of an initial business combination that some of our stockholders may not support. Our amended and restated certificate of incorporation will provide that any of its provisions related to pre-initial business combination activity (including the requirement to deposit proceeds of this offering and the private placement of units into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein and including to permit us to withdraw funds from the trust account such that the per share amount investors will receive upon any redemption or liquidation is substantially reduced or eliminated) may be amended if approved by holders of 65% of our common stock entitled to vote thereon, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of 65% of our common stock entitled to vote thereon. In all other instances, our amended and restated certificate of incorporation may be amended by holders of a majority of our outstanding common stock entitled to vote thereon, subject to applicable provisions of the DGCL or applicable stock exchange rules. We may not issue additional securities that can vote on amendments to our amended and restated certificate of incorporation. Our initial stockholders, who will collectively beneficially own up to 20% of our common stock upon the closing of this offering, will participate in any vote to amend our amended and restated certificate of incorporation and/or trust agreement and will have the discretion to vote in any manner they choose. As a result, we may be able to amend the provisions of our amended and restated certificate of incorporation which govern our pre-initial business combination behavior more easily than some other blank check companies, and this may increase our ability to complete an initial business combination with which you do not agree. Our stockholders may pursue remedies against us for any breach of our amended and restated certificate of incorporation. 49 Our sponsor, initial stockholders, officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 15 months from the closing of this offering, which is extendable at our option to up to 21 months, as described herein, or (ii) with respect to any other provision relating to stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of Class A common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, divided by the number of then outstanding public shares. These agreements are contained in a letter agreement that we have entered into with our sponsor, initial stockholders, officers and directors. Our stockholders are not parties to, or third-party beneficiaries of, these agreements and, as a result, will not have the ability to pursue remedies against our sponsor, initial stockholders, officers or directors for any breach of these agreements. As a result, in the event of a breach, our stockholders would need to pursue a stockholder derivative action, subject to applicable law. We may be unable to obtain additional financing to complete our initial business combination or to fund the operations and growth of a target business, which could compel us to restructure or abandon a particular business combination. We have not selected any specific business combination target, but intend to target businesses larger than we could acquire with the net proceeds of this offering and the sale of the private placement warrants. As a result, we may be required to seek additional financing to complete such proposed initial business combination. We cannot assure you that such financing will be available on acceptable terms, if at all. To the extent that additional financing proves to be unavailable when needed to complete our initial business combination, we would be compelled to either restructure the transaction or abandon that particular business combination and seek an alternative target business candidate. Further, the amount of additional financing we may be required to obtain could increase as a result of future growth capital needs for any particular transaction, the depletion of the available net proceeds in search of a target business, the obligation to repurchase for cash a significant number of shares from stockholders who elect redemption in connection with our initial business combination and/or the terms of negotiated transactions to purchase shares in connection with our initial business combination. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share plus any pro rata interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes on the liquidation of our trust account and our warrants will expire worthless. In addition, even if we do not need additional financing to complete our initial business combination, we may require such financing to fund the operations or growth of the target business. The failure to secure additional financing could have a material adverse effect on the continued development or growth of the target business. None of our officers, directors or stockholders is required to provide any financing to us in connection with or after our initial business combination. If we are unable to complete our initial business combination, our public stockholders may only receive approximately $10.20 per share on the liquidation of our trust account, and our warrants will expire worthless. Furthermore, as described in the risk factor entitled If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share, under certain circumstances our public stockholders may receive less than $10.20 per share upon the liquidation of the trust account. Our initial stockholders may exert a substantial influence on actions requiring a stockholder vote, potentially in a manner that you do not support. Upon the closing of this offering, our initial stockholders will own shares representing 20.0% of our issued and outstanding shares of common stock (including the shares of Class A common stock underlying the private placement warrants and assuming they do not purchase any units in this offering). Accordingly, they may exert a substantial influence on actions requiring a stockholder vote, potentially in a manner that you do not support, including amendments to our amended and restated certificate of incorporation and approval of major corporate transactions. If our initial stockholders purchase any units in this offering or if our initial stockholders purchase any additional shares of common stock in the aftermarket or in privately negotiated transactions, this would increase their control. Factors that would be considered in making such additional purchases would include consideration of the current trading price of our Class A common stock. In addition, our board of directors, whose members were elected by our initial stockholders, is and will be divided into two classes, each of which will generally serve for a term of two years with only one class of directors being elected in each year. We may not hold an annual meeting of stockholders to elect new directors prior to the completion of our initial business combination, in which case all of the current directors will continue in office until at least the completion of the initial business combination. If there is an annual meeting, as a consequence of our staggered board of directors, only a minority of the board of directors will be considered for election and our initial stockholders, because of their ownership position, will have considerable influence regarding the outcome. Accordingly, our initial stockholders will continue to exert control at least until the completion of our initial business combination. 50 A provision of our warrant agreement may make it more difficult for use to consummate an initial business combination. Unlike some other blank check companies, if (i)we issue additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at a Newly Issued Price of less than $9.20 per share; (ii)the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (iii)the Market Value is below $9.20 per share, then the exercise price of the warrants will be adjusted to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. This may make it more difficult for us to consummate an initial business combination with a target business. Our warrants and founder shares may have an adverse effect on the market price of our Class A common stock and make it more difficult to effectuate our initial business combination. We will be issuing warrants to purchase 5,000,000 shares of our Class A common stock (or up to 5,750,000 shares of Class A common stock if the underwriters over-allotment option is exercised in full) as part of the units offered by this prospectus and, simultaneously with the closing of this offering, we will be issuing in a private placement, private placement warrants to purchase an aggregate of 6.0 million shares of Class A common stock (or up to 6.6 million shares if the underwriters over-allotment option is exercised in full). B. Riley has agreed to purchase up to 600,000 private placement warrants in the event the underwriters exercise the over-allotment option and our sponsor and initial stockholders elect not to purchase such private placement warrants in connection with the over-allotment option. Our initial stockholders currently own an aggregate of 2.875 million founder shares. The founder shares are convertible into shares of Class A common stock on a one-for-one basis, subject to adjustment as set forth herein. In addition, if our sponsor or its affiliates, or any of our officers or directors, makes any working capital loans, up to $1,500,000 of such loans may be converted into private placement-equivalent warrants at a price of $1.00 per warrant, at the option of the lender. Such warrants would be identical to the private placement warrants, including as to exercise price, exercisability and exercise period. To the extent we issue shares of Class A common stock to effectuate an initial business combination, the potential for the issuance of a substantial number of additional shares of Class A common stock upon conversion of these rights or exercise of these warrants could make us a less attractive business combination vehicle to a target business. Any such issuance will increase the number of issued and outstanding shares of our Class A common stock and reduce the value of the shares of Class A common stock issued to complete the initial business combination. Therefore, our warrants and founder shares may make it more difficult to effectuate an initial business combination or increase the cost of acquiring the target business. The private placement warrants are identical to the warrants sold as part of the units in this offering, except that the private placement warrants will not trade and they (including the Class A common stock issuable upon exercise of these warrants) may not, subject to certain limited exceptions, be transferred, assigned or sold by our sponsor until 30 days after the completion of our initial business combination. For so long as the private placement warrants are held by B. Riley or 272 Capital, they will not be exercisable more than five years from the commencement of sales of this offering in accordance with FINRA Rule 5110(g)(8)(A). 51 Because we must furnish our stockholders with target business financial statements, we may lose the ability to complete an otherwise advantageous initial business combination with some prospective target businesses. The federal proxy rules require that a proxy statement with respect to a vote on an initial business combination meeting certain financial significance tests include historical and/or pro forma financial statement disclosure in periodic reports. We will include the same financial statement disclosure in connection with our tender offer documents, whether or not they are required under the tender offer rules. These financial statements may be required to be prepared in accordance with, or be reconciled to, accounting principles generally accepted in the United States of America, or GAAP, or international financial reporting standards as issued by the International Accounting Standards Board, or IFRS, depending on the circumstances and the historical financial statements may be required to be audited in accordance with the standards of the Public Company Accounting Oversight Board (United States), or PCAOB. These financial statement requirements may limit the pool of potential target businesses we may acquire because some targets may be unable to provide such financial statements in time for us to disclose such statements in accordance with federal proxy rules and complete our initial business combination within the prescribed time frame. We may engage in an initial business combination with one or more target businesses that have relationships with entities that may be affiliated with our sponsor, officers, directors or existing holders which may raise potential conflicts of interest. In light of the involvement of our sponsor, officers and directors with other entities, we may decide to acquire one or more businesses affiliated with our sponsor, officers or directors. Our directors also serve as officers and board members for other entities, including, without limitation, those described under the section of this prospectus entitled Management Conflicts of Interest. Such entities may compete with us for business combination opportunities. Our sponsor, officers and directors are not currently aware of any specific opportunities for us to complete our initial business combination with any entities with which they are affiliated, and there have been no preliminary discussions concerning an initial business combination with any such entity or entities. Although we will not be specifically focusing on, or targeting, any transaction with any affiliated entities, we would pursue such a transaction if we determined that such affiliated entity met our criteria for an initial business combination as set forth in the section of this prospectus entitled Proposed Business Selection of a Target Business and Structuring of our Initial Business Combination and such transaction was approved by a majority of our disinterested directors. Despite our agreement to obtain an opinion from an independent investment banking firm that is a member of FINRA, or from an independent accounting firm, regarding the fairness to our stockholders from a financial point of view of an initial business combination with one or more domestic or international businesses affiliated with our officers, directors or existing holders, potential conflicts of interest still may exist and, as a result, the terms of the initial business combination may not be as advantageous to our public stockholders as they would be absent any conflicts of interest. Since our sponsor, officers and directors will lose their entire investment in us if our initial business combination is not completed, a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination. On March 31, 2021, our sponsor paid $25,000 to purchase an aggregate of 3,750,000 shares of Class B common stock, par value $0.0001 per share. In December 2021, our sponsor surrendered an aggregate of 875,000 founder shares for no consideration, thereby reducing the aggregate number of founder shares outstanding to 2,875,000. Of the founder shares outstanding, 375,000 founder shares are subject to forfeiture depending on the extent to which the underwriters option to purchase additional units is exercised. The number of founder shares issued was determined based on the expectation that such founder shares would represent 20% of the outstanding shares after this offering. The founder shares will be worthless if we do not complete an initial business combination. In addition, our sponsor and certain of our initial stockholders have agreed to purchase an aggregate of 6.0 million warrants (or 6.6 million warrants if the over-allotment option is exercised in full) at a price of $1.00 per warrant, for an aggregate purchase price of $6.0 million, or $6.6 million if the over-allotment option is exercised in full, that will also be worthless if we do not complete an initial business combination. Holders of founder shares have agreed (i) to vote any shares owned by them in favor of any proposed initial business combination, and (ii) not to redeem any founder shares in connection with a stockholder vote to approve a proposed initial business combination or in connection with a tender offer. In addition, we may obtain loans from our sponsor, affiliates of our sponsor or an officer or director. The personal and financial interests of our officers and directors may influence their motivation in identifying and selecting a target business combination, completing an initial business combination and influencing the operation of the business following the initial business combination. Our independent directors have a financial interest in our founder shares, either directly or through our sponsor. They acquired that interest at no cost. As a result, our independent directors have a financial interest in consummating an initial business combination, even if our stock declines in value after that business combination and our public stockholders experience losses in connection with their investment. However, if we do not consummate our initial business combination, the founder shares would be worthless. The financial interest of our independent directors in the founder shares may give rise to a potential conflict of interest in considering potential target businesses. You should consider this potential conflict of interest in deciding whether to invest in this offering and whether to redeem your shares at the time of our initial business combination. On March 31, 2021, our sponsor paid $25,000 to purchase an aggregate of 3,750,000 shares of Class B common stock, par value $0.0001 per share. In December 2021, our sponsor surrendered an aggregate of 875,000 founder shares for no consideration, thereby reducing the aggregate number of founder shares outstanding to 2,875,000. Our independent directors will likely directly or indirectly own founder shares following this offering. Consequently, our independent directors may profit substantially if we consummate our initial business combination, even if our stock price declines in value after that business combination and our public stockholders, who typically have purchased their units or shares for prices at or about $10.00 each, experience significant losses in connection with their investment. If we fail to consummate an initial business combination, however, the founder shares will be worthless, although in contrast our public stockholders will receive a pro rata distribution of the aggregate amount then on deposit in the trust account. As a result, the financial interest of our independent directors in our founder shares may prompt them to consider an initial business combination with a risky target business and/or on terms that may not be favorable to our public stockholders, particularly as the deadline for completing our initial business combination nears. You should consider our independent directors potential conflict of interest when deciding whether to invest in this offering. If you do invest in this offering, you should consider this potential conflict of interest when you decide whether to redeem your shares at the time of our initial business combination. 52 We may seek business combination opportunities in industries or sectors which may or may not be outside of our management s area of expertise. Although we intend to focus our search on established, technology focused businesses, we will consider an initial business combination outside of our management s area of expertise if an initial business combination candidate is presented to us and we determine that such candidate offers an attractive business combination opportunity for our company or we are unable to identify a suitable candidate in this sector after having expanded a reasonable amount of time and effort in an attempt to do so. Although our management will endeavor to evaluate the risks inherent in any particular business combination candidate, we cannot assure you that we will adequately ascertain or assess all of the significant
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+PROSPECTUS SUMMARY 1
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+Prospectus Summary 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: Amended and Restated Memorandum and Articles of Association are to the memorandum and articles of association of the Company to be in effect upon completion of this offering; Cantor are to Cantor Fitzgerald & Co. and Mizuho are to Mizuho Securities USA LLC, the representatives of the underwriters in this offering; Companies Act are to the Companies Act (as amended) of the Cayman Islands; founder shares are to our Class B ordinary shares initially purchased by our sponsor in a private placement prior to this offering, and Class A ordinary shares issuable upon the conversion thereof as provided herein; initial shareholders are to our sponsor and any other holders of our founder shares prior to this offering (or their permitted transferees); management or our management team are to our officers and directors; ordinary resolution are to a resolution adopted by the affirmative vote of at least a majority of the votes cast by the holders of the issued shares present in person or by proxy at a general meeting of the Company and entitled to vote on such matter; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares, collectively; placement shares are to the ordinary shares included within the placement units being purchased separately by our sponsor and Cantor and Mizuho in the private placement; as well as any shares that may be included in additional units that may be issued upon conversion of working capital loans and the sponsor loan as described herein; placement units are to the units being purchased separately by our sponsor and Cantor and Mizuho in the private placement, each placement unit consisting of one placement share and one-half of one placement warrant, each placement unit consisting of one placement share and one-half of one placement warrant; placement warrants are to the warrants included within the placement units being purchased separately by our sponsor and Cantor and Mizuho in the private placement, as well as any units that may be issued upon conversion of working capital loans and the sponsor loan as described herein; private placement are to the private placement of 650,000 placement units being purchased by our sponsor (537,500 units) and Cantor and Mizuho (112,500 units) at a price of $10.00 per unit, for an aggregate purchase price of $6,500,000, which will occur simultaneously with the completion of this offering; public shares are to Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders are to the holders of our public shares, including our initial shareholders and management team to the extent our initial shareholders and/or members of our management team purchase public shares, provided that each initial shareholder s and member of our management team s status as a public shareholder shall only exist with respect to such public shares; Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED FEBRUARY 7, 2022 $225,000,000 Endeavor Acquisition Corp. 22,500,000 Units Endeavor Acquisition Corp. is a newly incorporated blank check company incorporated as a Cayman Islands exempted company incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. While we may pursue an initial business combination target in any business or industry, we intend to focus our search on growth assets in Asia, including companies in the technology and consumer sectors. We shall not undertake our initial business combination with any entity with its principal business operations in China (including Hong Kong and Macau). This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share and one-half of one redeemable warrant. Only whole warrants are exercisable. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as described herein. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. The warrants will become exercisable 30 days after the completion of our initial business combination, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. The underwriters have a 45-day option from the date of this prospectus to purchase up to an additional 3,375,000 units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination, subject to the limitations described herein. If we are unable to complete our initial business combination within 18 months from the closing of this offering or during any shareholder approved extension period, we will redeem 100% of the public shares for cash, subject to applicable law and certain conditions as further described herein. Our sponsor, Endeavor Sponsor LLC, a Cayman Islands limited liability company, and Cantor Fitzgerald & Co. and Mizuho Securities USA LLC, the representative of the underwriters, which we refer to as Cantor and Mizuho , have agreed to purchase an aggregate of 650,000 placement units at a price of $10.00 per unit (537,500 placement units by our sponsor and 112,500 placement units by Cantor and Mizuho), for an aggregate purchase price of $6,500,000 in a private placement that will close simultaneously with the closing of this offering. Each placement unit will be identical to the units sold in this offering, except as described in this prospectus. The placement units will be sold in a private placement that will close simultaneously with the closing of this offering. In addition, our sponsor has agreed to lend us $4,500,000 (or $5,175,000 if the underwriters overallotment option is exercised in full) as of the closing date of this offering at no interest, which we refer to as our sponsor loan. The proceeds of the sponsor loan will be added to the trust account described below and the sponsor loan will be repaid or converted into sponsor loan units at a conversion price of $10.00 per unit, at the sponsor s discretion, as discussed elsewhere in this prospectus. Our initial shareholders, which include our sponsor, own an aggregate of 6,468,750 Class B ordinary shares (up to 843,750 shares of which are subject to cancellation depending on the extent to which the underwriters over-allotment option is exercised), which will automatically convert into Class A ordinary shares on a one-for-one basis, subject to adjustment as provided herein and in our Amended and Restated Memorandum and Articles of Association at the time of our initial business combination or earlier at the option of the holders thereof, as described herein. Prior to our initial business combination, only holders of our Class B ordinary shares will be entitled to vote on the appointment or removal of directors, and vote to continue the company in a jurisdiction outside the Cayman Islands. With respect to any other matter submitted to a vote of our shareholders, including any vote in connection with our initial business combination, except as required by law, holders of our Class B ordinary shares and holders of our Class A ordinary shares will vote together as a single class, with each share entitling the holder to one vote. Currently, there is no public market for our units, Class A ordinary shares or warrants. We will apply to have our units listed on the Nasdaq Global Market, or Nasdaq, under the symbol ENACU . We expect that our units will be listed on the Nasdaq on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on Nasdaq. We expect the Class A ordinary shares and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Cantor and Mizuho, acting as representatives of the underwriters inform us of their decision to allow earlier separate trading, subject in either case to our satisfaction of certain conditions. Once the securities comprising the units begin separate trading, we expect that the Class A ordinary shares and warrants will be listed on Nasdaq under the symbols ENAC and ENACW respectively. We are an
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+PROSPECTUS SUMMARY This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: A.G.P. are to A.G.P./Alliance Global Partners; common stock are to our Class A common stock and our Class B common stock, collectively; extension loan are to loans made by the sponsor or its affiliates or designees which are deposited into the trust account for Funded Extension Periods, as defined in this prospectus; founder shares are to shares of our Class B common stock initially purchased by our sponsor and A.G.P. in private placements prior to this offering, and the shares of our Class A common stock issuable upon the conversion thereof as provided herein; initial stockholders are to our sponsor, A.G.P. and any other holders of our founder shares prior to this offering (or their permitted transferees); management or our management team are to our officers, directors and director nominees; private placement shares are to the shares of Class A common stock underlying the private placement units issued to our sponsor in a private placement simultaneously with the closing of this offering; private placement units are to the units issued to our sponsor in a private placement simultaneously with the closing of this offering, which private placement units are identical to the units sold in this offering, subject to certain limited exceptions as described in this prospectus; private placement warrants are to the warrants underlying the private placement units issued to our sponsor in a private placement simultaneously with the closing of this offering, which private placement warrants are identical to the warrants sold in this offering, subject to certain limited exceptions as described in this prospectus; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder s and member of our management team s status as a public stockholder shall only exist with respect to such public shares; public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and to the private placement warrants if held by third parties other than our sponsor or the underwriters (or permitted transferees), in each case, following the consummation of our initial business combination; representative are to A.G.P., as the representative of the underwriters in this offering; sponsor are to Relativity Acquisition Sponsor LLC, a Delaware limited liability company; warrants are to our redeemable warrants, which includes the public warrants as well as the private placement warrants; and we, us, company or our company are to Relativity Acquisition Corp. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option and gives effect to the cancellation of 511,250 founder shares on December 14, 2021 and the issuance of 355,000 founder shares to the representative on December 14, 2021. 1 Table of Contents Our Company We are a newly organized blank check company formed as a Delaware corporation for the purpose of effecting a merger, share exchange, asset acquisition, reorganization, share purchase or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not identified any specific business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any potential business combination target. While we intend to focus our search for businesses in the cannabis industry, we may pursue a business combination target in any business, industry or geographical location, including related industries such as consumer packaged goods, health & wellness, technology, pharmaceuticals, manufacturing, distribution, logistics and brand management. Any target business in the cannabis industry that we identify must be compliant with all applicable laws and regulations within the jurisdictions in which it is located or operates and, in particular, we will not invest in, or consummate a business combination with, a target business that we reasonably believe has been operating, or whose business plan is to operate, in violation of U.S. federal laws or foreign laws, including the U.S. Controlled Substances Act. The cannabis industry has experienced significant growth over the last several years. With full federal legalization in Canada and 36 states in the United States allowing for some type of legal use under state law, the cannabis industry is amongst the fastest growing industries in the world. We believe that the normalization of cannabis and its many uses both therapeutic and recreational is creating a rarely seen opportunity to invest in related businesses. At the same time, the cannabis industry is highly fragmented and subject to a complex regulatory framework, creating significant barriers to entry. The cannabis-related investment space is currently dominated by small funds which we believe lack both the capital and the necessary experience to see their investments through multiple rounds of funding. We believe that there are several types of target businesses that could benefit from our partnership and are compliant with all applicable laws and regulations within the jurisdictions in which they are located or operate. In the United States, this would currently include certain non-plant touching businesses that support the functioning of state-licensed commercial cannabis activity but are not directly related to cultivation, manufacturing, processing, branding, transportation, distribution, storage or sale of cannabis and cannabis-based products. Another set of eligible targets in the U.S. would include certain hemp derived cannabidiol ( CBD ) businesses that are compliant with the U.S. Agricultural Improvement Act of 2018 (the 2018 Farm Bill ), which would include targets engaged in (i) cultivation and/or processing of hemp, (ii) the manufacturing of hemp extracts and/or extraction of cannabinoids from hemp, and/or (iii) branding, transportation, distribution, storage or sale of hemp-derived CBD. Any such targets would only produce products that are derived from hemp, as defined in the 2018 Farm Bill, and would therefore have a delta- 9 tetrahydrocannabinol ( THC ) concentration of not more than 0.3 percent on a dry weight basis, in each case pursuant to August 2020 U.S. Drug Enforcement Administration ( DEA ) regulations implementing the 2018 Farm Bill. In addition, any such products must comply with the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 301 et seq.) ( FFDCA ) and its implementing regulations, as amended from time to time. We may also consider companies pursuing a U.S. Food and Drug Administration ( FDA ) track (or its equivalent in the relevant jurisdiction) for pharmaceutical applications and treatments that contain compounds found in cannabis. There are also a number of qualifying cannabis-related licensed operators in industries outside of the United States. This includes companies currently operating in jurisdictions where cannabis has been decriminalized for recreational use, such as Canada and Uruguay, as well as jurisdictions in which medical use is legal, such as Colombia and Germany. Globally, more than 50 countries have legalized some form of medical cannabis and we believe that legislative trends in certain jurisdictions will continue to broaden our opportunity set for eligible acquisitions. The transition of cannabis and its related industries to a regulated and legal marketplace has been happening at a rapid pace over recent years. Many countries have or are contemplating some form of legalized use, including Canada and the United States. In the United States, there have been several bills introduced to relax restrictions on commercial cannabis activity. For example, the Marijuana Freedom and Opportunity Act was first introduced in the United States Senate in June 2018, and later reintroduced in both houses of Congress in May 2019. Although Congress never took action on that bill, it would have removed marijuana from the schedule of controlled substances under the Controlled Substances Act and eliminated federal criminal penalties for the import, export, manufacture, distribution and possession of marijuana. The Secure and Fair Enforcement Banking Act (the SAFE Banking Act ), which has passed in the United States House of Representatives several times, was most recently 2 Table of Contents attached to the National Defense Authorization Act (the NDA Act ) and passed again by the United States House of Representatives in September 2021. While the U.S. Senate ultimately rejected the incorporation of the SAFE Banking Act language in the NDA Act, the SAFE Banking Act would provide banks that work with state-legal marijuana businesses a safe harbor under existing federal anti-money laundering laws. In November 2021, President Biden signed into law the Infrastructure Investment and Jobs Act, which includes a provision that allows researchers to study marijuana that consumers purchase from state-legal dispensaries, rather than relying solely on government-grown cannabis. First introduced in 2019, the United States House of Representatives approved the Marijuana Opportunity, Reinvestment and Expungement Act (the MORE Act ) a comprehensive cannabis reform bill that would remove cannabis from the Controlled Substances Act schedules, legalize commercial cannabis activity and promote social equity in December 2020. However, the legislation did not pass the U.S. Senate, an was reintroduced in the House of Representatives in May 2021. While President Biden has supported decriminalization of possession and has not expressed support for de-scheduling cannabis, Vice President Harris was one of the original sponsors of the MORE Act while she was still serving in the U.S. Senate, and has publicly stated her support for cannabis de-scheduling. In July 2021, Senate Majority Leader Chuck Schumer of New York, and Senators Ron Wyden (OR) and Cory Booker (NJ) circulated a discussion draft of the Cannabis Administration and Opportunity Act (CAOA), that would deschedule cannabis and legalize, tax and regulate commercial cannabis activity at the federal level. Senate Majority Leader Schumer has indicated the Senate leadership s willingness to champion full cannabis legalization even without the support of President Biden. However, the legislation has not yet been introduced, and it may never be introduced or signed into law. On November 15, 2021, an additional new comprehensive cannabis de-scheduling bill known as the States Reform Act was introduced in Congress by Congresswoman Nancy Mace (R-S.C.). The States Reform Act would remove marijuana from Schedule I of the federal Controlled Substances Act, and create a legislative framework for overlaying federal regulations on top of existing state regulations of commercial cannabis activity, but without creating the social equity programs featured in both the MORE Act and CAOA. It is unclear whether the States Reform Act will be passed by Congress. We believe that this momentum will continue to accelerate worldwide, generating tremendous opportunity in the industry, with both broader legislative acceptance and an evolving regulatory environment. There have already been hundreds of businesses launched across various sub-sectors of the cannabis industry, many of which are located in Canada or the United States. These businesses have raised billions of dollars from investors in public and private markets, including strategic investments from major multinational companies that are altering or broadening their core business focus. Many of these businesses have valuations in excess of a billion dollars. However, the cannabis industry is still in its infancy. In order to succeed under the new legislative and regulatory frameworks, we believe that businesses will need strong management teams with deep operational expertise and financial acumen. As this industry evolves, we believe that investors will become more discerning and will focus on business models that can scale profitably. Despite recent high-profile investments, we believe the total quantum of invested capital in the space is scant relative to other major industry sectors. As the industry evolves and legislative and regulatory hurdles are addressed, we anticipate an institutionalization of capital investment, with reduced reliance on high net worth individuals, family offices and select hedge funds. We believe that this will be manifested by new investors providing sources of liquidity that will resemble more mature markets, including increased breadth of financial instruments across the capital structure. We believe that globally the cannabis industry will continue to grow at a rapid pace in the coming years. Unlike other emerging industries, which have been driven by massive technological advances, cannabis has supported therapeutic treatments for thousands of years across a variety of cultures. The evolution of public perception is being sustained by consumers seeking cannabis-based treatments for a variety of health and wellness needs. We believe that there will be growth via the broader adoption of cannabis for non-recreational use. Potential sources for additional growth include the disruption of a variety of health-related market segments including pain management, sleep, skin care and cosmetics and anxiety, as well as many other applications that are being explored. Tarek K. Tabsh, Chief Executive Officer and Chairman of the Company, has over 15 years of legal, commercial cannabis experience. In 2017, Mr. Tabsh co-founded and guided the initial vision and strategy for Oxford Cannabinoid Technologies, a UK-based pharmaceutical company that develops therapies targeting the 3 Table of Contents endocannabinoid system, in areas such as pain and cancer, in partnership with Oxford University. Mr. Tabsh was instrumental in raising an institutional round of investment from one of the largest tobacco companies in the world. Since 2017, Mr. Tabsh serves as a founding partner of GT Consulting, a firm based in the UK and United States that advises some of the most prominent companies in the world on how to understand the dynamic and complex cannabis industry, and how to approach forward-looking M&A strategy, in preparation for legislative reform. In 2016, Mr. Tabsh also co-founded Province Brands, a disruptive, premium beverage technology company in Ontario, Canada, and helped create the world s first cannabis brewery, as well as a new brewing tradition with a patented technology designed to enable the world s first beverage fermented from the cannabis/hemp plant rather than barley or grain. Mr. Tabsh worked to develop the recipes, methods, processes and intellectual property for development. From 2016 to 2018, Mr. Tabsh founded the New Amsterdam Naturals dispensary and brand in Las Vegas, a brand that has won over 25 industry awards, including High Times World and U.S. and California Cannabis Cups. For all of Mr. Tabsh s dispensary developments, he has a deep commitment to improving his community. For his efforts in revitalizing the downtown district, Mr. Tabsh was awarded a Nevada State Senate Certificate of Appreciation. His dispensary facility was also showcased in the European Union Parliament as a model for the responsible retail of medical marijuana. He developed his first medical cannabis dispensaries over ten years ago in Los Angeles and successfully collaborated with government and community stakeholders to lobby for the implementation of regulatory frameworks for cannabis commerce in Los Angeles. He has also advised licensed producers and distributors of cannabinoid medicines throughout the European Union. Mr. Tabsh has also served on the ArcView Selection Committee from 2016 to 2017 and was responsible for evaluating and selecting the companies that meet the criteria necessary for pitching to the world s largest network of cannabis investors; as an ArcView Shark, Mr. Tabsh was responsible for providing insightful feedback and suggestions to entrepreneurs pitching a business from the ArcView stage. For his decade of experience and commitment to founding innovative cannabis startups, Mr. Tabsh was named to the High Times list of the Top 100 Most Influential Figures in Cannabis in both 2018 and 2019. Mr. Tabsh completed his graduate education by crafting a multidisciplinary course framework at the Harvard Business School, the Harvard School of Engineering and Applied Sciences and the Massachusetts Institute of Technology, Sloan School of Management with an emphasis on innovation-driven entrepreneurship. Steven Berg, our Chief Financial Officer, is a business leader with over 30 years experience spanning investment banking to building prominent companies in the cannabis industry. He has leveraged his background in strategy, capital raising and finance to build some of the most successful brands in cannabis. Mr. Berg is passionate about creating sustainable value through innovative strategy, execution via best practices and high ethical standards for the benefit of all enterprise stakeholders. Since September 2021, Mr. Berg has served as the Chief Financial Officer and Secretary and a member of the board of directors of Triangle 9 Real Estate, Inc. Mr. Berg s key professional accomplishments have been achieved in executive roles at consumer products and financial companies. Mr. Berg most recently was CEO of NWT Holdings, LLC (dba Firefly Vapor), from June 2017 to December 2019, a leader in cannabis vaporization technology and consumer products. After taking the helm of the innovative startup company in 2017, Mr. Berg streamlined operations and managed new product development to position for growth. To scale the brand, he then successfully negotiated and executed the acquisition of Firefly by SLANG Worldwide as an integral component to SLANG s IPO on the Canadian Stock Exchange. Prior to Firefly, Mr. Berg was the CFO of NWT Holdings, Inc. (dba O.penVAPE/Organa Brands, from December 2013 to June 2016), a Colorado pioneer in cannabis vaporization and oil extraction products. In addition to managing corporate finances and strategic initiatives, he drove brand expansion into multiple new state markets through recruitment of new operational partners and structuring license agreements. Prior to O.penVAPE, Mr. Berg was a founding partner of the ArcView Group s ArcView Investor Network (May 2011 November 2013), the cannabis industry s first private investor network. ArcView has raised over $300 million in funding for startup entrepreneurs, venture and growth-stage companies. He conceived the network structure, engineered initial operations and recruited charter investor members that built the foundation for ArcView s success. Before entering the legal cannabis arena, Mr. Berg worked as an investment banker for major financial firms. He served as a Managing Director in the Capital Markets Group at Wells Fargo Bank in San Francisco, focusing on structured and derivatives transactions in corporate finance and developing multiple new funding and risk management products. He previously was with Union Bank of Switzerland and BNP Paribas in New York, where he worked in mergers and acquisitions, as well as in derivatives trading and risk management functions in the capital markets. Mr. Berg holds an M.B.A. from New York University Stern School of Business, and an undergraduate degree in Finance and Accounting from San Francisco State University. 4 Table of Contents John Anthony Quelch, our Director Nominee, currently serves as the Dean of the University of Miami Herbert Business School. From February 2013 until June 2017, Mr. Quelch served as the Charles Edward Wilson Professor of Business Administration at Harvard Business School and Professor of Health Policy and Management at Harvard T.H. Chan School of Public Health. From February 2011 until January 2013, Mr. Quelch served as the dean of the China Europe International Business School. From July 1998 until June 2001, Mr. Quelch served as the Dean of the London Business School. Mr. Quelch has experience serving on the Board of Directors of various United States companies, including Aramark Corporation (NYSE: ARMK), a food service, facilities and uniform service provider, Gentiva Health Services Inc. (NASDAQ: GTIV), a provider of home health care, hospice and related services in the United States, the Pepsi Bottling Group (now PepsiCo, Inc. ) (NASDAQ: PEP), an American multinational food, snack and beverage corporation, and Reebok International Limited (NSYE: RBK), a British-American footwear and clothing company. Mr. Quelch has also served as a board member of three pre-IPO data analytics companies, Datalogix and Vitrue (both sold to Oracle) and Affinnova (sold to A.C. Nielsen). Since October 2021, Mr. Quelch serves as a board member of Industrial Human Capital, Inc. He is also a director nominee for three special purpose acquisition companies, TechStackery, Inc., Vital Human Capital, Inc. and Firemark Global Capital, Inc. In 2013, Professor Quelch retired from the board of WPP, the world s leading marketing services company, after 25 years of service (including seven years as chair of the audit committee). In the United Kingdom, he also served on the boards of Blue Circle Industries, easyJet and Pentland Group. Mr. Quelch is currently a member of the Council on Foreign Relations, a New York-based think tank, the Trilateral Commission, a non-governmental and nonpartisan think tank whose purpose is to foster close cooperation between Japan, Western Europe and North America, and the American Academy of Arts and Sciences, a learned society that conducts policy studies and public policy advocacy. Mr. Quelch served as the pro bono chairman of the Massachusetts Port Authority from February 2002 until January 2011. Mr. Quelch received a Bachelor s degree and a Master s degree from Exeter College at Oxford University and an MBA from the Wharton School at the University of Pennsylvania, and received both a Master of Science ( SM ) and a Doctorate of Business Administration degree from Harvard University. Mr. Quelch is well-qualified to serve on our board of directors due to his extensive experience in strategic marketing and leadership roles in higher education and his numerous directorship positions, as well as his participation in multiple nonprofit organizations. Emily Paxhia, our Director Nominee, has served as a co-founder and managing director of Poseidon Investment Management, LLC ( Poseidon ), a cannabis-focused hedge fund, since October 2013. During her time at Poseidon, Ms. Paxhia has worked with numerous cannabis companies in an advisory and investment capacity. Ms. Paxhia has served as a director of Athletes for CARE, a nonprofit organization that works with retired professional athletes to research and advocate on behalf of important health issues, since March 2018. Ms. Paxhia currently serves as director and Chair of the Compensation & Governance Committee for Ascend Wellness Holdings. She holds board seats with some private portfolio companies including: Headset, Flowhub and Respira Technologies. Previously, Ms. Paxhia served on the Board of Directors of the Marijuana Policy Project, a nonprofit advocacy group that advocates on behalf of marijuana-related policy reform, from May 2016 to December 2016. Ms. Paxhia received a B.A. in Psychology from Skidmore College, and received an M.A. in Psychology from New York University. Ms. Paxhia is well-qualified to serve on our board of directors because of her substantial experience in the cannabis industry, as well as her significant involvement in the nonprofit space. Francis Knuettel II, our Director Nominee, currently serves as Chief Executive Officer and on the board of Unrivaled Brands, Inc. since December 2020 (OTCQX: UNRV). Mr. Knuettel was formerly a Restructuring Advisory Consultant at Viridian Capital Advisors from May 2020 to November 2020. Mr. Knuettel joined Viridian while at One Cannabis Group ( OCG ) where Mr. Knuettel was the Chief Financial Officer from June 2019 to January 2021 and was integral to the sale of the company to Item 9 Labs Corp. (OTCQX: INLB). Prior to OCG, Mr. Knuettel was CFO at MJardin, a Denver-based cannabis cultivation and dispensary management company, from August 2018 to June 2019, where he led the company s IPO on the Canadian Securities Exchange. Following the IPO, Mr. Knuettel managed MJardin s merger with GrowForce, a Toronto-based cannabis cultivator, after which he moved over to the Chief Strategy Role. In his role as CSO, he managed the acquisition of several private companies before recommending and executing the consolidation of management and other operations to Toronto and the closure of the executive office in Denver. Prior to MJardin, Mr. Knuettel held numerous CFO and CEO positions at early-stage and NASDAQ-listed companies where he had significant experience both building and restructuring businesses. Mr. Knuettel serves on several corporate boards, including on the Board of Directors of 180 Life Sciences, an early-stage therapeutic biotech company, since July 2021, on the Board of Directors of Sanatio BioScience Corp., an early-stage anti-viral platform, since September 2020 (where he is the chair of the 5 Table of Contents company s audit committee) and on the Board of Directors of ECOM Medical, Inc., a developer of endotracheal patient monitoring systems, since July 2019 (where he is the chair of the company s audit committee). Mr. Knuettel graduated cum laude from Tufts University with a B.A. degree in Economics and from The Wharton School of Business at the University of Pennsylvania with an MBA in Finance and Entrepreneurial Management. Mr. Knuettel is a director nominee for another special purpose acquisition company, Murphy Canyon Acquisition Corp. Mr. Knuettel is well-qualified to serve on our board of directors due to his experience in working with and advising public and private companies on financial management and controls, M&A, capital markets transactions and operating and financial restructurings, as well as his knowledge of the cannabis industry. Business Strategy Our business strategy is to identify and complete our initial business combination with a target operating in the cannabis industry that is compliant with all applicable laws and regulations within the jurisdictions in which it is located or operates, or related industries such as consumer packaged goods, health & wellness, technology, pharmaceuticals, manufacturing, distribution, logistics and brand management. We believe that there is an opportunity to take advantage of a newly emerging industry, with a variety of established operators seeking access to capital and managerial expertise. We intend to leverage our team s collective operating, technical, regulatory and legal expertise to build a strong business with competitive advantages to emerge as a leading public company in the space. As the industry continues to transition to a new legislative and regulatory framework, we believe that many companies will need a partner that can assist in providing a level of operational and financial expertise to support their growth. Our team includes a variety of investment, operational and healthcare professionals who will provide operating, technical, regulatory and legal expertise to assist a target business access the public markets. Our acquisition plan is to leverage our management team s networks of potential transaction sources where we believe a combination of our management team s industry relationships, knowledge and experience could effect a positive transformation or augmentation of existing businesses or assets. Over the course of their careers, the members of our management team have developed a broad network of contacts and corporate relationships that we believe will serve as a useful source of acquisition opportunities. We plan to leverage relationships with management teams of public and private companies, investment professionals at private equity firms and other financial sponsors, owners of private businesses, investment bankers, restructuring advisers, consultants, attorneys and accountants, which we believe should provide us with a number of business combination opportunities. Following the completion of this offering, the members of our management team plan to communicate with their networks of relationships to articulate the parameters for our search for a target business and a potential business combination and begin the process of pursuing and reviewing potentially interesting leads. We will be supported by A.G.P. and its team of investment banking professionals, each of whom have meaningful transaction experience, including corporate finance, mergers and acquisitions, equity and debt capital markets, strategic consulting and operations. A.G.P. has developed an extensive network of contacts and corporate relationships which we believe will provide us with an important source of initial business combination opportunities. A.G.P. is a leading advisor to public company boards of directors and executives, including technology companies, on matters of public markets capital raising, corporate strategy and M&A. We believe that the significant knowhow of A.G.P. will allow us to effectively gauge target companies that possess a readiness for being public, as well as to support their executives in the process of going public. Acquisition Criteria We have identified the following general criteria and guidelines which we believe are important in evaluating prospective target businesses. While we intend to utilize these criteria in evaluating business combination opportunities, we expect that no individual criterion will entirely determine a decision to pursue a particular opportunity, and we may decide to enter into our initial business combination with a target business that does not meet any or all of these criteria or guidelines. 6 Table of Contents We seek to acquire a company which: Has an enterprise value of approximately $500 million to $1 billion; Has a market and/or cost leadership position and would benefit from our management expertise and extensive relationships (i.e., rewards stellar management ); Occupies relatively fast-growing markets (i.e., top line growth ); Has strong drivers of revenue and earnings growth and exhibits barriers to competition ; Has the potential to generate strong and stable free cash flow; Is underperforming its operating potential and underutilizing its balance sheet; and By creating strategic value offers an attractive risk-adjusted return for our stockholders. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our stockholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation materials or tender offer documents that we would file with the SEC. Initial Business Combination In accordance with the rules of Nasdaq, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (excluding the amount of the business combination fee held in trust and taxes payable on the income earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to satisfaction of such criteria. Our stockholders may not be provided with a copy of such opinion nor will they be able to rely on such opinion. Subject to this requirement, our management will have virtually unrestricted flexibility in identifying and selecting one or more prospective businesses, but if the business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as our initial business combination for purposes of a seeking stockholder approval or conducting a tender offer, as applicable. We do not currently intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. We will have until 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the time to complete a business combination as described in this prospectus) to consummate an initial business combination. We anticipate structuring our initial business combination either (i) in such a way so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses, or (ii) in such a way so that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders, or for other reasons. However, we will only complete an initial business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act . Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. 7 Table of Contents However, as a result of the issuance of a substantial number of new shares of common stock, our stockholders immediately prior to such transaction could own less than a majority of our outstanding shares of common stock subsequent to such transaction. In addition, other minority stockholders may subsequently combine their holdings, resulting in a single person or group obtaining a larger share of the company s stock than we initially acquired. Accordingly, this may make it more likely that our management will not be able to maintain our control of the target business. We cannot provide assurance that, upon loss of control of a target business, new management will possess the skills, qualifications or abilities necessary to profitably operate such business. Our Business Combination Process In evaluating prospective business combinations, we expect to conduct a thorough due diligence review process that may encompass, among other things, a review of historical and projected financial and operating data, meetings with management and their advisors (if applicable), on-site inspection of facilities and assets, discussion with customers and suppliers, legal reviews and other reviews as we deem appropriate. We will also leverage our operational and capital allocation experience in order to: Assemble a team of industry and financial experts: For each potential transaction, we intend to assemble a team of industry and financial experts to supplement our management s efforts to identify and resolve key issues facing the company. We intend to construct an operating and financial plan which optimizes the potential to grow stockholder value. With extensive experience investing in both healthy and underperforming businesses, we expect that our management will be able to demonstrate to the target business and its stakeholders that we have the resources and expertise to lead the combined company through complex and often turbulent market conditions and provide the strategic and operational direction necessary to grow the business in order to maximize cash flows and improve the overall strategic prospects for the business; Conduct rigorous research and analysis: Performing disciplined, bottom-up fundamental research and analysis is core to our strategy, and we intend to conduct extensive due diligence to evaluate the impact that a transaction may have on the target business; Acquire the target company at an attractive price relative to our view of its intrinsic value: Combining rigorous bottom-up analysis as well as input from industry and financial experts, the management team intends to develop its view of the intrinsic value of the potential business combination. In doing so, the management team will evaluate future cash flow potential, relative industry valuation metrics and precedent transactions to inform its view of intrinsic value, with the intention of creating a business combination at an attractive price relative to such view; Implement operating and financial structuring opportunities: We believe our management team has the ability to structure and execute a business combination that will provide the combined business with a capital structure that will support growth in stockholder value and give the combined company the flexibility needed to grow organically and/or through strategic acquisitions or divestitures. We intend to also develop and implement strategies and initiatives to improve the business s operating and financial performance and create a platform for growth; and Seek follow-on strategic acquisitions and divestitures to further grow stockholder value: The management team intends to analyze the strategic direction of the company and evaluate non-core asset sales to create financial and/or operating flexibility needed for the company to engage in organic or inorganic growth. Specifically, the management team intends to evaluate opportunities for industry consolidation in the company s core lines of business as well as opportunities to vertically or horizontally integrate with other industry participants. Following our initial business combination, we intend to evaluate opportunities to enhance stockholder value, including developing and implementing corporate strategies and initiatives to provide financial and operating runway such that the company can improve its profitability and long-term value. In doing so, the management team anticipates evaluating corporate governance, opportunistically accessing capital markets and other opportunities to enhance liquidity, identifying acquisition and divestiture opportunities, and properly aligning management and board incentives with growing stockholder value. 8 Table of Contents We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from independent investment banking firm or another independent entity that commonly renders valuation opinions that our initial business combination is fair to our company and our stockholders from a financial point of view.
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001860782_2seventy_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001860782_2seventy_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001861449_bird_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001861449_bird_prospectus_summary.txt
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+This summary highlights selected information from this prospectus and may not contain all of the information that is important to you in making an investment decision. Before investing in our securities, you should read this entire document carefully, including our financial statements and the related notes included in this prospectus and the information set forth under the headings Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations. Some of the statements in this prospectus constitute forward-looking statements. See Cautionary Statement Regarding Forward-Looking Statements. Overview Our Mission Bird s mission is to provide environmentally friendly transportation for everyone. Our Business At Bird, we believe in leading the transition to clean, equitable transportation through innovation and technology. That means developing mobility solutions that put people and communities first. In partnership with cities, Bird s proprietary technology and operations are revolutionizing the existing transportation paradigm by making lightweight electric vehicles readily available to rent or own around the world. We provide riders with a convenient alternative to transport themselves to work, to a local business, or elsewhere in their communities. Our products and services are designed with one goal in mind: to make cities more livable by reducing car usage, lowering carbon emissions, and improving the safety of all road users. Bird s cleaner, affordable, and on-demand mobility solutions are available in more than 400 cities across four continents. We take a collaborative, community-first approach to micromobility. By tailoring our operations to meet local transportation needs and collaborating with cities, we are actively reducing the hundreds of billions of trips under five miles made by gas-powered cars every year. Of the eight trillion trips taken globally each year, 60% are under five miles in length. COVID-19 has accelerated the adoption of environmentally friendly, socially distanced transportation alternatives such as Bird. As the world enters a new, post-pandemic normal, we are continuing to work with cities to increase micromobility access and infrastructure investments and ensure that the shift to sustainable urban transportation continues. In response to COVID-19, many cities and towns have adopted favorable regulations for shared micromobility and invested in infrastructure to support affordable and safe transportation alternatives. Advancing Transportation for the Modern Era In most places, the current transportation paradigm is dangerous, inefficient, and environmentally detrimental. Counties like Los Angeles have dedicated significant land area to roadways and car parking infrastructure, while global deaths due to automobile collisions have ballooned to 1.35 million per year. Furthermore, in the United States, the transportation industry has become the single largest polluter, accounting for nearly 30% of the country s total greenhouse gas emissions. This is unsustainable, and it is having a particularly dire impact in urban areas. Table of Contents CONFIDENTIAL TREATMENT REQUESTED PURSUANT TO 17 C.F.R. SECTION 200.83 The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and does not constitute the solicitation of offers to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED MAY 25 , 2022 BIRD GLOBAL, INC. UP TO 55,217,203 SHARES OF CLASS A COMMON STOCK This prospectus relates to the resale from time to time of up to 55,217,203 shares of Class A common stock, par value $0.0001 per share (the Class A common stock ), of Bird Global, Inc., a Delaware corporation ( Bird Global ), by YA II PN, Ltd., a Cayman Islands exempt limited partnership (the Selling Securityholder ). The shares included in this prospectus consist of shares of Class A common stock that we have issued or that we may, in our discretion, elect to issue and sell to the Selling Securityholder, from time to time after the date of this prospectus, pursuant to a standby equity purchase agreement we entered into with the Selling Securityholder on May 12, 2022 (the Purchase Agreement ), in which the Selling Securityholder has committed to purchase from us, at our direction, up to $100,000,000 of our Class A common stock, subject to terms and conditions specified in the Purchase Agreement. As consideration for the Selling Stockholder s irrevocable commitment to purchase shares of our Class A common stock at our election and in our discretion from time to time after the date of this prospectus and prior to the third anniversary of the Purchase Agreement, upon the terms and subject to the satisfaction of the conditions set forth in the Purchase Agreement, we have agreed to issue to the Selling Stockholder 217,203 shares of Class A common stock pursuant to the terms of the Purchase Agreement (the Commitment Shares ). See the section of this prospectus entitled Committed Equity Financing for a description of the Purchase Agreement and the section entitled Selling Securityholder for additional information regarding the Selling Securityholder. Our registration of the securities covered by this prospectus does not mean that the Selling Securityholder will offer or sell any of the shares of Class A common stock. The Selling Securityholder may offer, sell, or distribute all or a portion of its shares of Class A common stock publicly or through private transactions at prevailing market prices or at negotiated prices. We will not receive any proceeds from the sale of shares of Class A common stock by the Selling Securityholder pursuant to this prospectus. However, we may receive up to $100,000,000 in aggregate gross proceeds from sales of our Class A common stock to the Selling Securityholder that we may, in our discretion, elect to make, from time to time after the date of this prospectus, pursuant to the Purchase Agreement. We provide more information about how the Selling Securityholder may sell or otherwise dispose of the shares of our Class A common stock in the section entitled Plan of Distribution. We will bear all costs, expenses, and fees in connection with the registration of the shares of Class A common stock offered hereby. The Selling Securityholder will bear all commissions and discounts, if any, attributable to its sales of the shares of Class A common stock offered hereby. The Selling Securityholder is an underwriter within the meaning of Section 2(a)(11) of the U.S. Securities Act of 1933, as amended (the Securities Act ), and any profits on the sales of shares of our Class A common stock by the Selling Securityholder and any discounts, commissions, or concessions received by the Selling Securityholder are deemed to be underwriting discounts and commissions under the Securities Act. Our shares of Class A common stock are listed on The New York Stock Exchange (the NYSE ) under the symbol BRDS. On May 24 , 2022, the closing sale price of our Class A common stock was $0.80 per share. We are an emerging growth company and a smaller reporting company under the federal securities laws and will be subject to reduced disclosure and public reporting requirements. See Summary Implications of Being an Emerging Growth Company and a Smaller Reporting Company. Investing in shares of our Class A common stock involves risks that are described in the Risk Factors section beginning on page 12 of this prospectus. Neither the U.S. Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of the securities to be sold under this prospectus or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents CONFIDENTIAL TREATMENT REQUESTED PURSUANT TO 17 C.F.R. SECTION 200.83 ABOUT THIS PROSPECTUS
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001862490_tritium_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001862490_tritium_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001862733_cariloha_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001862733_cariloha_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all of the information that you should consider before deciding to invest in our common stock. You should carefully read the entire prospectus, including the sections entitled Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations, and our financial statements and the related notes included elsewhere in this prospectus, before making an investment decision. Some of the statements in this prospectus constitute forward-looking statements. See Cautionary Note Regarding Forward-Looking Statements. Unless otherwise indicated or the context otherwise requires, references in this prospectus to the Company, Cariloha, we, us and our refer to Cariloha and its consolidated subsidiaries. Our Mission Our mission is to provide customers with soft and sustainable products it s who we are and at the heart of what we do. Cariloha is more than a name or a brand it s A Comfy Way to Save the Planet, where we care about the earth today so we have a better home for future generations tomorrow. Who We Are We are an omni-channel brand focused on soft and sustainable bedding, clothing and bath goods made of eco-friendly viscose-from-bamboo, or Bamboo, one of the most renewable and sustainable resources on the planet. We provide customers with eco-friendly alternatives to traditional fabrics, and we ve become one of the few brands that has successfully developed a full line of products and home goods that utilizes fabrics produced from Bamboo. We market and sell our products through our fast-growing e-commerce channel, modern and efficient showrooms and wholesale channel. We are dedicated to creating a community for environmentally conscious consumers through our clean, sustainable, effective and thoughtfully designed products. We have cultivated deep relationships with our customers who continue to promote awareness of the brand, allowing us to achieve best-in-class unit economics and to significantly outpace our peers. Furthermore, our longstanding contractual marketing partnerships with major cruise lines provide us access to tens of thousands of new customers who visit our unique footprint of showrooms located in high-traffic destinations and cruise ports-of-call. Our award-winning product offering, deep digital connection with our consumers and integrated omni-channel accessibility position us for continued growth. Soft and Sustainable Products Inspired by the Island Lifestyle Cariloha has its roots in the islands, and our passion for comfort and sustainability was born there helping customers sleep, live and feel every day like they do on vacation. Our pineapple icon is the ultimate symbol of the islands. It represents our culture and connection to where we started and to our namesake Cariloha, where the style of the CARIbbean meets the spirit of aLOHA. Since our inception in 2007, we have become a globally recognized brand with a strong e-commerce, showroom and wholesale presence. Our Founder and CEO, Jeff Pedersen, had a vision for creating a new category in the marketplace one that was dedicated to comfort and sustainability in a single package, offering a comfortable way for individuals and Cariloha to save the planet together. Focusing on what inspired us initially, we have organically grown to become a leading eco-conscious lifestyle brand. By turning self-replenishing bamboo fields into luxuriously soft, eco-friendly Bamboo fabrics, we offer an extensive collection of bedding, bath and apparel made from Soft, Cool, Clean, Green fabrics. Bedding. We provide a full suite of sustainable, innovative and high-quality bedding products, including sheets, mattresses, pillows, blankets, duvets and more. As of September 30, 2021, our bedding category offered 184 SKUs priced from $25 to $2,900. For the nine months ended September 30, 2021, our bedding products represented 67.5% of total revenue. Apparel. We provide premium apparel products for men and women, including shirts, active wear, sleepwear, underwear and socks. As of September 30, 2021, our apparel category offered 6,959 SKUs priced from $10 to $89. For the nine months ended September 30, 2021, our apparel products represented 18.1% of total revenue. TABLE OF CONTENTS The information in this preliminary prospectus supplement is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED FEBRUARY 11, 2022 2,000,000 Shares Class A Common Stock This is an initial public offering of shares of Class A Common Stock ( common stock ) of Cariloha, Inc. We are offering 2,000,000 shares of our common stock. Prior to this offering, there has been no public market for our common stock. It is currently estimated that the initial public offering price per share of common stock will be between $9.00 and $11.00. We intend to list our common stock on the Nasdaq Capital Market under the symbol ALOHA . We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, and will be subject to reduced public company reporting requirements. This prospectus is intended to comply with the requirements that apply to an issuer that is an emerging growth company. See Prospectus Summary Implications of Being an Emerging Growth Company. Investing in our common stock involves risks. Please read Risk Factors beginning on page 14 for factors you should consider before investing in our common stock. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. Per Share Total Initial public offering price $ $ Underwriting discounts and commissions(1) $ $ Proceeds, before expenses, to us $ $ (1) We refer you to Underwriting beginning on page 138 of this prospectus for additional information regarding underwriting compensation. The underwriters have been granted the option to purchase up to an additional 300,000 shares of common stock from Cariloha Holdings, LLC (the selling stockholder ), which is indirectly owned by certain of our directors and executive officers. If the underwriters exercise their option, we will not receive any proceeds from the sale of shares by the selling shareholder. The underwriters expect to deliver the shares of common stock against payment on or about , 2022. Joint Book-Running Managers Roth Capital PartnersOppenheimer & Co. Co-Manager Craig-Hallum The date of this prospectus is , 2022. TABLE OF CONTENTS TABLE OF CONTENTS EXPLANATORY NOTE iii ABOUT THIS PROSPECTUS iii TRADEMARKS, SERVICE MARKS AND TRADE NAMES iii MARKET AND INDUSTRY DATA iii PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001862979_verdant_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001862979_verdant_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001863099_kimbell_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001863099_kimbell_prospectus_summary.txt
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated certificate of incorporation are to our certificate of incorporation to be in effect upon the completion of this offering; common stock are to our Class A common stock and our Class B common stock; DGCL are to the General Corporation Law of the State of Delaware; directors are to our current directors and director nominees; equity-linked securities are to any securities of our company or any of our subsidiaries which are convertible into, or exchangeable or exercisable for, equity securities of our company or such subsidiary, including any securities issued by our company or any of our subsidiaries which are pledged to secure any obligation of any holder to purchase equity securities of our company or any of our subsidiaries, and including Opco Units; extension option are to the option of the sponsor, upon deposit of the extension fee into the trust account, to cause us to extend the available time to consummate our initial business combination by three months; the sponsor may exercise the extension option up to two times, allowing for up to an additional six months (for a total of 21 months) to complete an initial business combination; extension fee are to an amount equal to $0.10 per public share (a total of $2,000,000, or $2,300,000 if the underwriters over-allotment option is exercised in full) that the sponsor may deposit into the trust account in order to exercise the extension option; founder shares are to Class B Units of Opco initially issued to our sponsor in a private placement prior to this offering (or the Class A Units of Opco into which such Class B Units of Opco will convert) and a corresponding number of shares of our non-economic Class B common stock; initial stockholders are to holders of our founder shares and sponsor shares prior to this offering; KRP are to Kimbell Royalty Partners, LP (NYSE: KRP); KRP Opco are to Kimbell Royalty Partners Operating, LLC, a subsidiary of KRP and the managing member of our sponsor; management or our management team are to our officers and directors; Opco are to our operating subsidiary, Kimbell Tiger Operating Company, LLC; Opco LLC Agreement are to the limited liability company agreement of Opco; Opco Units are to the Class A Units and Class B Units of Opco; private placement warrants are to the warrants to purchase shares of our Class A common stock issued to our sponsor in a private placement simultaneously with the closing of this offering and warrants that may be issued upon conversion of working capital loans (as described herein); public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and, unless otherwise stated herein, the 2,500 shares of our Class A common stock forming part of the sponsor shares; TABLE OF CONTENTS combination within 15 months from the closing of this offering (or up to 21 months, if the sponsor exercises its extension options), subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. We will provide our public stockholders with the opportunity to redeem all or a portion of their shares of our Class A common stock upon the completion of our initial business combination at a per-share price described in this prospectus, payable in cash, subject to the limitations described herein. If we have not completed our initial business combination within 15 months from the closing of this offering (or up to 21 months, if the sponsor exercises its extension options), we will redeem 100% of the public shares at a per-share price described in this prospectus, payable in cash, subject to applicable law. Our sponsor, Kimbell Tiger Acquisition Sponsor, LLC, a Delaware limited liability company (which we refer to as our sponsor throughout this prospectus), is an indirect subsidiary of Kimbell Royalty Partners, LP, a Delaware limited partnership (which we refer to as KRP throughout this prospectus). Our sponsor will commit to purchase an aggregate of 12,750,000 warrants (or 14,100,000 warrants if the underwriter s over-allotment option is exercised in full) at a price of $1.00 per warrant ($12,750,000 in the aggregate, or $14,100,000 in the aggregate if the underwriter s over-allotment option is exercised in full) in a private placement that will close simultaneously with the closing of this offering. Each private placement warrant entitles the holder thereof to purchase for $11.50 one share of our Class A common stock, subject to adjustment as described in this prospectus. As of the date of this prospectus, our sponsor holds 5,750,100 shares of Class B common stock, 5,750,000 Class B Units of our operating subsidiary, Kimbell Tiger Operating Company, LLC (which we refer to as Opco throughout this prospectus) (up to 750,000 of which shares of Class B common stock and Class B Units of Opco are subject to forfeiture depending on the extent to which the underwriter s over-allotment option is exercised), 100 Class A Units of Opco and 2,500 shares of our Class A common stock. The Class B Units of Opco will automatically convert into Class A Units of Opco in connection with our initial business combination on a one-for-one basis, subject to adjustment as provided herein. We refer to the Class B Units of Opco (or the Class A Units of Opco into which such Class B Units will convert), together with a corresponding number of shares of our non-economic Class B common stock, collectively as the founder shares throughout this prospectus. The founder shares will be exchangeable for shares of our Class A common stock at the time of our initial business combination on a one-for-one basis, subject to adjustment as provided herein. On any vote to approve our initial business combination or on any other matter submitted to a vote of our stockholders prior to our initial business combination, holders of our Class A common stock and holders of our Class B common stock will generally vote together as a single class, except as required by Delaware law or stock exchange rule, with each share of our common stock entitling the holder to one vote. Following our initial business combination, holders of our Class A common stock and holders of our Class B common stock will generally vote together as a single class on all matters presented for a stockholder vote, except as required by Delaware law or stock exchange rule, with each share of our common stock entitling the holder to one vote. Prior to this offering, there has been no public market for our units, Class A common stock or warrants. Our units have been approved for listing on the New York Stock Exchange (the NYSE ) under the symbol TGR.U. We expect that our units will be listed on the NYSE on or promptly after the date of this prospectus. We expect that the Class A common stock and warrants constituting the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day), unless UBS Securities LLC informs us of its decision to allow earlier separate trading, subject to certain conditions. Once the securities constituting the units begin separate trading, we expect that the Class A common stock and warrants will be listed on the NYSE under the symbols TGR and TGR.WS, respectively. The underwriter is offering the units for sale on a firm commitment basis. Delivery of the units will be made on or about , 2022. Sole Book-Running Manager UBS Investment Bank The date of this prospectus is , 2022 TABLE OF CONTENTS SUMMARY public stockholders are to the holders of our public shares, including our sponsor, officers and directors to the extent our sponsor, officers or directors purchase public shares, provided that each of their status as a public stockholder shall only exist with respect to such public shares; public warrants are to our warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); related companies are to KRP, KRP Opco and their respective subsidiaries and certain other entities with an executive management team that may from time to time include one or more members of our management team; sponsor are to Kimbell Tiger Acquisition Sponsor, LLC, a Delaware limited liability company and a subsidiary of KRP Opco; sponsor shares are to the 100 Class A Units of Opco and corresponding number of shares of our non-economic Class B common stock (which together will be exchangeable into shares of Class A common stock after our initial business combination on a one-for-one basis) and the 2,500 shares of our Class A common stock purchased by our sponsor in a private placement prior to this offering; warrants are to the public warrants and the private placement warrants; and we, us, our, company, our company, or TGR are to Kimbell Tiger Acquisition Corporation, a Delaware corporation, or, where applicable, members of its management team. Unless we tell you otherwise, the information in this prospectus assumes that the underwriter will not exercise its over-allotment option and the forfeiture by our sponsor of an aggregate of 750,000 founder shares. General TGR is a newly organized blank check company, incorporated as a Delaware corporation, formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to our initial business combination. Although we may pursue an initial business combination in any industry, we intend to capitalize on our management team s core competencies to focus our search in the energy and natural resources industry in North America. Our management team has extensive experience in identifying and executing large, complex transactions in the energy industry, and significant hands-on experience working with private companies in preparing for and executing an initial public offering. Our team has a history of being active owners and directors by working closely with companies to create value in the public markets. In 2017, as a part of its IPO process, KRP, which is the ultimate parent of our sponsor, negotiated the combination of assets and entities from multiple contributing parties to create the KRP public entity. We believe that this ability to form partnerships with private owners to build an entity of scale that is preferred by the public markets differentiates us as we look at potential business combinations. Our team is knowledgeable and experienced in public and private M&A dynamics across a range of sizes, and adept at using an Up-C structure such as ours to acquire assets and businesses. KRP has a proven track record of value accretive M&A using equity as acquisition currency and of returning capital to shareholders through a variable dividend. KRP has returned ~34% of its IPO unit price via cash dividends in fewer than five years. We will also benefit from our management team s extensive market knowledge across the United States. With KRP s mineral and royalty interests spanning 28 states and in every major onshore basin in the U.S. Lower 48, our team has insight on every corner of the market and expertise in technical evaluation of comparable oil and gas assets. This broad exposure and basin-agnostic approach has allowed our team to focus on value maximization rather than basin concentration. Furthermore, we believe that our TABLE OF CONTENTS SUMMARY relationship with our sponsor will provide expanded access to deal flow and potential targets. KRP s long history in the minerals and royalties space has allowed members of our team to develop extensive relationships with both exploration and production companies and individual land / mineral owners, which will lead to strong support for a yield-oriented consolidation vehicle with value uplift. We believe that our management team is well positioned to effectuate a successful business combination and provide attractive risk-adjusted returns in the marketplace. Our management believes that its ability to identify and implement value creation initiatives differentiates its acquisition strategy from others in the market. Kimbell Royalty Partners, LP and our sponsor Our sponsor is a wholly owned subsidiary of KRP Opco, which is in turn a subsidiary of KRP. KRP is a leading publicly traded oil and gas mineral and royalty company based in Fort Worth, Texas with more than 42 MBoe of proved reserves (43.3% liquids). KRP owns mineral and royalty interests in approximately 9.1 million gross acres and overriding royalty interests in approximately 4.6 million gross acres. KRP s reach extends across 28 states and in every major onshore basin in the U.S. Lower 48, including ownership in more than 97,000 gross wells. KRP has ~21% of its overall production from conventional assets, including certain Enhanced Oil Recovery (EOR) projects. KRP believes that this conventional production provides a base level of production stability that helps facilitate overall organic production growth as new, unconventional wells come online. KRP completed its IPO in 2017 by negotiating the combination of assets and entities from multiple parties to create the KRP public entity. Since its IPO, KRP has been a leading consolidator in the U.S. oil and gas mineral and royalty sector, having completed acquisitions totaling approximately $950 million in cash and equity consideration. KRP s Up-C structure has been helpful in facilitating acquisitions, with owners of target companies generally preferring to receive equity of KRP Opco (which is taxed as a pass-through partnership for federal income tax purposes) rather than shares of KRP itself (which is taxed as a corporation for federal income tax purposes). Selected acquisitions include: Haymaker Minerals & Royalties acquired for approximately $444.0 million in cash and equity (ultimately in the form of equity of KRP Opco); Phillips Energy Partners acquired for approximately $171.6 million in equity (in the form of equity of KRP Opco); and Springbok Energy acquired for approximately $123.1 million in cash and equity (in a combination of equity of KRP Opco and KRP itself). Our Management Team and Board of Directors Our management team and Board of Directors (our Board ) collectively have over 100 years of experience in sourcing, evaluating and underwriting numerous acquisitions across the U.S. Lower 48. We believe that the track record and industry network of our management team and Board will provide for a robust and privileged set of business combination opportunities. As officers and directors of energy companies, our team has significant experience creating value in the public markets, which we believe will differentiate us, from both an M&A and capital markets perspective, among other potential counterparties when evaluating similar business combinations. Zachary Lunn President and Chief Executive Officer: Zachary Lunn has extensive operating experience in the E&P sector, including conventional and unconventional reservoirs across multiple states and basins. Mr. Lunn began his career with Nexen Petroleum USA, gaining experience in operations, business development, and reservoir engineering while working assets in the Gulf of Mexico. Following the $15.1 billion sale of Nexen to CNOOC, Mr. Lunn pursued a production/operations position with Petro-Hunt LLC, where he supervised the company s operated production, including all conventional and unconventional reservoirs in Texas, Louisiana, Mississippi, North Dakota, Montana, and Wyoming. Further, Mr. Lunn created a development plan for 500,000 Bakken acres and played an integral role on the divestiture team, resulting in $1.45 billion in M&A activity. In 2014, Mr. Lunn joined Enduro Resource Partners and was responsible for 550 wellsites in North Dakota, Texas, and Louisiana. In July 2018, TABLE OF CONTENTS SUMMARY upon learning that Enduro Resource Partners planned to sell their assets, Mr. Lunn partnered with the principals of Cobra Oil & Gas Corporation and acquired the properties. Upon acquisition, Mr. Lunn managed all day-to-day activities of Cobra Oil & Gas Corporation including operations, marketing, business development, and finance. Under Mr. Lunn s stewardship, Cobra Oil & Gas grew production while maintaining high levels of free cash flow. Mr. Lunn is a member of the Society of Petroleum Engineers, American Association of Drilling Engineers, and Fort Worth Wildcatters. He received his Bachelor of Science degree in Petroleum Engineering from Louisiana State University. R. Blayne Rhynsburger Controller: Blayne Rhynsburger has served as the Controller of the general partner of KRP since February 2017. Mr. Rhynsburger previously served as the Controller of KRP s predecessor from November 2015 until KRP s IPO. Prior to that time, Mr. Rhynsburger served as audit manager from July 2014 to November 2015, audit senior from July 2011 to June 2014, and audit staff from September 2009 to June 2011 at Whitley Penn LLP, where he specialized in assurance and advisory services for clients in multiple industries, primarily energy clients in the public and private sectors. Mr. Rhynsburger also has served as an adjunct professor of petroleum accounting in the graduate school of Texas Christian University s Neeley School of Business since 2015. Mr. Rhynsburger holds a Bachelor of Business Administration degree in Accounting and Finance and a Master of Accounting degree from Texas Christian University. He is also a member of the Texas Society of Certified Public Accountants. Robert D. Ravnaas Chairman: Bob Ravnaas has served as Chief Executive Officer of the general partner of KRP and chairman of its board of directors since November 2015. Mr. R. Ravnaas served as President of Cawley, Gillespie & Associates, Inc., a petroleum engineering firm, from 2011 until February 2017. He also served as President and director of Rivercrest Royalties II, LLC from 2014 until December 2017, and as President and director of Rivercrest Royalties, LLC from 2013 until KRP s IPO. Prior to joining Cawley, Gillespie & Associates, Inc. in 1983, he worked as a Production Engineer for Amoco Production Company from 1981 to 1983. Mr. R. Ravnaas received a Bachelor of Science degree with special honors in Chemical Engineering from the University of Colorado at Boulder and a Master of Science degree in Petroleum Engineering from the University of Texas at Austin. He is a registered professional engineer in Texas and a member of the Society of Petroleum Engineers, the Society of Petroleum Evaluation Engineers and the American Association of Petroleum Geologists. R. Davis Ravnaas Director and Strategic Advisor: Davis Ravnaas has served as President and Chief Financial Officer of the general partner of KRP since November 2015. Mr. D. Ravnaas co-founded Rivercrest Royalties, LLC, which was the predecessor to KRP, in October 2013, served as its Vice President and Chief Financial Officer from November 2013 to October 2015 and served as its President and Chief Financial Officer from October 2015 until KRP s IPO. He has also served as Vice President and Chief Financial Officer of Rivercrest Royalties Holdings II, LLC and/or its predecessor, Rivercrest Royalties II, LLC, since August 2014, and he is a partial owner of other companies that have contributed assets to KRP in the past and may do so in the future. From 2010 to 2012, Mr. D. Ravnaas was responsible for sourcing, evaluating and monitoring investments in energy and industrials companies as an associate investment professional with Crestview Partners, a New York based private equity fund. Mr. D. Ravnaas left Crestview Partners in 2012 to attend the Stanford Graduate School of Business, where he earned his Master in Business Administration in 2014. Mr. D. Ravnaas also has an AB in Economics from Princeton University and a MSc in Finance and Economics from the London School of Economics. Matthew S. Daly Director and Strategic Advisor: Matthew S. Daly has served as Chief Operating Officer of the general partner of KRP since May 2017. Mr. Daly previously served as Senior Vice President Corporate Development of the General Partner of KRP beginning in September 2016 and he served as Senior Vice President Corporate Development of KRP s predecessor from August 2016 until KRP s IPO. Prior to joining Kimbell, Mr. Daly spent 11 years in investment management, most recently at Kleinheinz Capital Partners, Inc. and Hirzel Capital Management, LLC, two Texas-based investment firms, where he helped manage both the public and private energy investments. He was also Chairman of Delta Biofuels, Inc., a portfolio company of Kleinheinz Capital Partners, Inc. Prior to this, Mr. Daly was an investment banker at Wasserstein Perella & Co. in New York City and later Lazard Fr res & Co., where he was a Vice President in the Mergers and Acquisitions group. Within this role, he advised on transactions totaling over $10 billion in value including acquisitions, divestitures, corporate restructurings and special committee assignments relating to takeover defense. He began his career at Arthur Andersen LLP in TABLE OF CONTENTS SUMMARY Dallas. He has a BBA from the University of Texas at Austin and an MBA from the Booth School at the University of Chicago. Kimberly DeWoody Director Nominee: Ms. DeWoody is the Finance Director for the Southwestern Exposition and Livestock Show (Fort Worth Stock Show & Rodeo), where she oversees all aspects of the Show s accounting and finance functions. Prior to joining the Show in November 2020, Ms. DeWoody spent a total of 13 years at Whitley Penn LLP where she became an audit partner effective January 1, 2017. Throughout her time at Whitley Penn, Ms. DeWoody had extensive experience providing audit and assurance services to a broad range of industries, with a significant focus on the oil and gas sector, and her clients included both publicly traded and privately held companies. Ms. DeWoody has substantial knowledge of U.S. accounting and auditing standards gained through her public accounting career. Additionally, while at Whitley Penn, Ms. DeWoody had international and IFRS experience through her participation in the Nexia International Secondment Program where she worked at Smith & Williamson s London office. She began in her career in public accounting at Ernst & Young in Houston, Texas. Ms. DeWoody was awarded Forty Under 40 by Hart Energy s Oil & Gas Investor. Additionally, Ms. DeWoody was awarded Forty Under 40 by the Fort Worth Business Press and is a graduate of Leadership Fort Worth. She was awarded the Legacy of Women Award by SafeHaven of Tarrant County. Ms. DeWoody holds Bachelor of Business Administration and Master of Accountancy degrees from Baylor University. She is a certified public accountant, licensed in the state of Texas, and a member of the American Institute of Certified Public Accountants, Texas Society of Certified Public Accountants (TXCPA), and Fort Worth Chapter of TXCPA. Fred N. Reynolds Director Nominee: Mr. Reynolds is the principal owner of Fred S. Reynolds and Associates, a petroleum engineering consulting firm located in Fort Worth, Texas. Mr. Reynolds graduated in 1979 with a Bachelor of Science in Petroleum Engineering from the University of Oklahoma. Following graduation, Mr. Reynolds worked for Chevron U.S.A. and Equity Oil Company as a drilling and completion engineer and Engineering Manager, before joining his father and forming the petroleum engineering consulting firm of Fred S. Reynolds and Associates in 1983. The consulting business consults in all aspects of petroleum engineering with the emphasis on reservoir evaluations, reserve determinations, and economic projections for the purposes of determining fair market value, loan values, and prospect screening. The firm s clients are oil and gas companies, individual royalty and working interest owners, estate planning attorneys, and bank trust and energy lending departments. None of our officers or directors have served as a sponsor, director or officer of any blank check companies or special purpose acquisition companies in the past. Market Opportunity Our team s extensive expertise will allow us to source and evaluate targets in the energy and natural resources sector, a sector that we believe is attractive for numerous reasons. The target market is expansive, as the sector is populated with many stranded assets across North America, and there is currently no natural consolidator of longer-lived, mature, shallow-decline assets. There is also limited liquidity for existing owners of non-core upstream assets that TGR would target for consolidation, leaving many owners with limited opportunities to either further develop or monetize their assets. We also believe that many operators will continue to seek to divest assets, primarily as a result of limited traditional capital markets access available to them and a general transition to capital discipline rather than growth strategies. Moreover, the bar has been raised for energy investing, creating room only for seasoned management teams with an efficient cost structure. Further, many assets are not of significant scale and fail to attract strong and well-capitalized buyers. These targets also invite a limited buyer universe, as buyers typically do not focus on out-of-favor basins or out-of-favor assets within popular basins. We believe these targets also present an opportunity for value accretion from consolidation and professional operations brought by seasoned operators. Therefore, even targets that demonstrate shallow declines, predictable production and associated cash flow profile could be overlooked and undercapitalized. We believe this confluence of overlooked, illiquid and undercapitalized assets presents a unique opportunity for a yield-oriented consolidation vehicle with an experienced management team that can maximize free TABLE OF CONTENTS SUMMARY cash flow potential. We believe that substantial synergies are possible when these assets are consolidated, and we believe that our management team is well-equipped to take advantage of these potential synergies due to its extensive experience within the industry. Our Business Strategy Although our efforts to identify a prospective target business will not necessarily be limited to a particular industry, sector or region, we intend to capitalize on our relationships, knowledge, experience and expertise in the energy and natural resources industry to identify, acquire and, after our initial business combination, build a company in the energy and natural resources industry in North America that complements the experience of our management team and can benefit from its operational expertise and executive oversight. Our acquisition will leverage our team s network of potential proprietary and public transaction sources where we believe a combination of our relationships, knowledge and experience in the energy and natural resources industry could effect a positive transformation or augmentation of existing businesses or properties to improve their overall value proposition. Our goal is to form a focused business with multiple competitive advantages and the potential to generate cash flow in excess of its capital. We would expect to grow the business over time, both organically and through acquisitions, with a focus on consistently achieving attractive returns on capital and maintaining conservative balance sheet metrics. We believe that SPACs that are led by teams with experience in the industry of the target company that they acquire have, following their initial business combinations, outperformed (on a share price basis) other companies that were the subject of SPAC transactions in which the SPAC team did not have experience in the industry of the target company. However, you should not rely on the historical record or performance of other public companies as indicative of the future performance of an investment in us or the returns we will or may generate going forward. See Risk Factors Risks Relating to Our Search for, and Consummation of or Inability to Consummate, a Business Combination We may seek acquisition opportunities in industries or sectors that may be outside of our management team s areas of expertise. Our management team is deeply familiar with the trends of our target industries and brings an investing approach that offers multiple competitive advantages in sourcing, evaluating and executing on opportunities, including: Stockholder Centric: TGR is intended to be a yield vehicle with the goal of maximizing free cash flow to stockholders. In order to achieve this goal, we will focus on mature, shallow decline assets with low reinvestment rates in order to seek to provide stability in both volumes and cashflows. We will also target assets with potential for value uplift through operational improvements, increasing cash flow potential. Consolidation Vehicle within the Upstream Space: If our team determines to acquire upstream oil and gas businesses or assets, TGR is expected to provide a vehicle by which it could consolidate previously stranded and fragmented working interest assets that have suffered from a lack of liquidity, thereby creating an avenue by which private equity sponsors and private companies could seek to optimize their investments in the upstream space. Differentiated Target Sourcing: Our team plans to consider targets in both traditionally favored basins as well as non-core assets in older basins that suffer from a lack of operational attention. These traditionally non-core assets in older basins are likely to have lower decline rates and opportunities for value uplift from management s operational abilities. We have a strong industry network that we will utilize in order to effectively and efficiently source these targets, and we intend to focus our search in states with regulatory climates favorable to the energy and natural resources industry. Long-Term Strategy: Our management team intends to be involved in growing and improving the business over time organically and through pursuing accretive and complementary acquisitions. Conservative Balance Sheet: We intend to focus on maintaining low net leverage and conservative balance sheet metrics as we seek to consistently achieve attractive returns on capital. TABLE OF CONTENTS SUMMARY Advantaged Business Structure: Our Up-C structure is an advantage with potential sellers due to incentives not offered through a traditional publicly traded corporation. We believe that our Up-C structure provides us with significant advantages as it provides flexibility in structuring a variety of business combinations, including the flexibility to retain an Up-C structure following the business combination or restructure as a result of the business combination, depending on the nature and structure of the target and the efficiency and administrability of retaining our post-offering structure after the business combination. See Our Structure. Acquisition Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines, which we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target that does not meet these criteria and guidelines. We plan to acquire upstream assets that possess the following characteristics: Mature, Low-decline, Long-lived Assets: We seek to acquire assets with a stable production history and shallow decline profile. These assets will typically have predictable production profiles and low capital intensity. Generation of Stable Free Cash Flow: We seek to acquire mature, shallow decline assets that generate free cash flow and are conducive to a yield vehicle. Benefits from Our Talented and Incentivized Management Team: We seek to acquire a business or asset whose performance and cash flow generation can be improved by the deep industry expertise of our management and sponsor. Unrecognized or Underutilized Value: We seek to acquire a business or asset that exhibits unrecognized or underutilized value that would benefit from management attention and expertise, capital deployment and synergies with future complementary acquisitions. Subject to an Inefficient Capital Structure: We seek to acquire a business that has an inefficient capital structure or offers the potential to improve the efficiency of the capital structure. Benefit from a Public Currency and Access to Public Equity Markets: We seek to provide sellers access to the public equity markets that will allow the target company to utilize additional forms of capital, enhancing its ability to pursue accretive acquisitions, high-return capital projects, and/or strengthen its balance sheet. These criteria and guidelines are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general criteria and guidelines, as well as other considerations, factors and criteria deemed relevant by our management in effecting our initial business combination consistent with our business objectives. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the Securities and Exchange Commission (the SEC ). Our Acquisition Process In evaluating a prospective target business, we expect to conduct a thorough due diligence review which may encompass, among other things, meetings with incumbent management and employees, document reviews, inspection of facilities, as well as a review of financial, operational, legal and other information that will be made available to us. We will leverage the vast experience of our management team and Board to evaluate the asset s technical merits and relative risk return profile. Acquisition evaluations will benefit from an extensive expertise in technical evaluation and deep industry connectivity which we believe will result in a robust deal pipeline. TABLE OF CONTENTS SUMMARY We have not selected any business combination target we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to out initial business combination. Certain members of our management team will indirectly own our securities following this offering, and accordingly, they may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. As described under Proposed Business Conflicts of Interest and Management Conflicts of Interest, each of our officers and directors has, and any of them in the future may have, additional fiduciary or contractual obligations to one or more other entities pursuant to which such officer or director may be required to present a business combination opportunity to such entities before he or she presents such opportunity to us. Also, none of KRP, our sponsor or any of our directors and officers is prohibited from sponsoring, investing or otherwise becoming involved with, any other blank check companies, including in connection with their initial business combinations. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity to which he or she has then-current fiduciary or contractual obligations to present such opportunity to another entity, he or she may only present such opportunity to us if such other entity rejects the opportunity. Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company; such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue; and such person has no fiduciary or contractual obligation to present the opportunity to any other person or entity. Additionally, none of KRP, our sponsor or any other entity currently has any obligation or duty to provide us with any potential business combination opportunity. In addition, KRP will adopt a policy pursuant to which any business combination opportunity that is a corporate opportunity of KRP that may also be a business combination opportunity for our company will first be presented to the conflicts committee of the board of directors of KRP, which is made up solely of independent directors, for consideration as to whether KRP desires to pursue such business combination opportunity as a direct investment or to present such opportunity to our company for consideration. The members of the conflicts committee of the board of directors of KRP will not serve in any fiduciary capacity at our company. For more information, including a list of our executive officers and directors and entities for which a conflict of interest may or does exist between such officers and the company, see Proposed Business Conflicts of Interest and Management Conflicts of Interest. We do not believe, however, that the fiduciary, contractual or other obligations or duties of our officers or directors or the KRP policy described above will materially affect our ability to complete our initial business combination. We may pursue an acquisition opportunity jointly with our sponsor, or one or more affiliates, including KRP or its affiliates, which we refer to as an Affiliated Joint Acquisition. Any such parties may co-invest with us in the target business at the time of our initial business combination, or we could raise additional proceeds to complete the acquisition by selling assets to such parties or issuing to such parties a class of equity or equity-linked securities. Our sponsor and its affiliates have no obligation to make any such investment, and may compete with us for potential business combinations. Any such issuance of equity or equity-linked securities would, on a fully diluted basis, reduce the percentage ownership of our then-existing stockholders. Notwithstanding the foregoing, pursuant to the anti-dilution provisions of our founder shares, issuances or deemed issuances of our Class A common stock or equity-linked securities would result in an adjustment to the number of Class A Units of Opco into which the Class B Units of Opco will convert (unless the holders of a majority of the outstanding founder shares agree to waive such adjustment with respect to any such issuance or deemed issuance) so that, after all founder shares have been exchanged for shares of our Class A common stock, the aggregate number of shares of our Class A common stock received by holders in exchange for founder shares would equal 20% of the sum of the total TABLE OF CONTENTS SUMMARY outstanding shares of our Class A common stock upon the completion of this offering (excluding the sponsor shares and any shares issuable upon exercise of any warrants) plus all shares of our Class A common stock and equity-linked securities issued or deemed issued in connection with the business combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in the business combination). In connection with an Affiliated Joint Acquisition, we may raise additional proceeds to consummate our initial business combination by selling a royalty interest in the underlying assets of the target business to KRP or its affiliates. A royalty interest is an interest that gives an owner the right to a portion of the resources or revenues derived from the underlying working interest assets. We expect that we will consider a sale of royalty interests to KRP or its affiliates if we seek to acquire a company that owns working interest oil and gas assets. However, KRP and its affiliates have no obligation to purchase any such royalty interest or make any other additional investment in us in connection with our initial business combination. Working interest oil and gas companies pay royalties (and other similar fees) to holders of mineral and royalty interests as oil and gas is produced from their properties. As such, if the post-business combination company sold a royalty interest to KRP or its affiliates, the net amount of revenues ultimately received by the post-business combination company would be reduced by the amount of any royalties paid to KRP, its affiliates and any other holders of such interests. Holders of royalty interests do not have to share the burden of any costs of development of the underlying assets, which means that the post-business combination company s costs of development would not be reduced by the sale of a royalty interest to KRP or its affiliates. We may elect to offer to sell a royalty interest to KRP or its affiliates to, among other reasons, (i) increase the amount of committed capital available to consummate our initial business combination, including in the event that the market for issuing securities to unaffiliated investors in a private investment in public equity, or PIPE, is challenging or difficult to consummate at the desired issue price, (ii) reduce dilution in connection with raising equity capital for our initial business combination, and (iii) demonstrate synergies among KRP and/or its affiliates and the target business, especially in light of KRP s knowledge and expertise in the oil and gas sector, its royalty interest ownership and the industry network of KRP s management team and board of directors. We believe that our relationship with KRP provides us with a competitive advantage compared to other special purpose acquisition companies in the event we seek to consummate our initial business combination with a working interest oil and gas company. Any decision regarding the sale of a royalty interest to KRP or its affiliates will be subject to our related party transaction policy that will be adopted in connection with this offering and will be subject to review and approval by the audit committee of our board of directors. Please see Certain relationships and related party transactions Related party policy. You should not rely on the historical record or performance of KRP, Mr. R. Ravnaas or other members of our management team as indicative of the future performance of an investment in us or the returns we will, or are likely to, generate going forward. See Risk Factors General Risk Factors Past performance by KRP, Mr. Ravnaas and other members of our management team may not be indicative of future performance of an investment in us. Initial Business Combination The rules of the NYSE require that we must consummate an initial business combination with one or more operating businesses or assets with a fair market value equal to at least 80% of the net assets held in the trust account (excluding the amount of any deferred underwriting discount held in trust ) at the time of our signing a definitive agreement in connection with our initial business combination. Our Board will make the determination as to the fair market value of a target business or businesses. If our Board is not able to independently determine the fair market value of a target business or businesses, we will obtain an opinion from an independent investment banking firm that is a member of the Financial Industry Regulatory Authority, Inc. ( FINRA ), or an independent accounting firm with respect to the satisfaction of such criteria. While we consider it unlikely that our Board will not be able to make an independent determination of the fair market value of a target business or businesses, it may be unable to do so if the Board is less familiar or experienced with the target company s business or there is a significant amount of uncertainty as to the value of the company s assets or prospects. TABLE OF CONTENTS SUMMARY We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares will, together with Opco, own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders or for other reasons, including an Affiliated Joint Acquisition as described above. However, we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise is not required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If we control less than 100% of the equity interests or assets of a target business or businesses, the portion of such business or businesses that is controlled is what will be valued for purposes of the 80% of net assets test. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as the initial business combination for seeking stockholder approval or for purposes of a tender offer, as applicable. Notwithstanding the foregoing, if we are not then listed on the NYSE for whatever reason, we would no longer be required to meet the foregoing 80% of net assets test. Prior to the effectiveness of the registration statement of which this prospectus forms a part, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended (the Exchange Act ). As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the completion of our initial business combination. Corporate Information We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion (as adjusted for inflation pursuant to SEC rules from time to time), or (c) in which we are deemed to be a large accelerated filer, which means the market value of our TABLE OF CONTENTS SUMMARY Class A common stock that is held by non-affiliates exceeds $700 million as of the end of that year s second fiscal quarter; and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company have the meaning associated with it in the JOBS Act. Our executive offices are located at 777 Taylor Street, Suite 810, Fort Worth, Texas 76102 and our telephone number is (817) 945-9700. Upon completion of this offering, our corporate website address will be kimbelltiger.com. Our website and the information contained on, or that can be accessed through, the website is not deemed to be incorporated by reference in, and is not considered part of, this prospectus or the registration statement of which this prospectus forms a part. You should not rely on any such information in making your decision whether to invest in our securities. Our Structure This offering is conducted through an Up-C structure. Following the offering, investors in this offering will hold a direct economic equity ownership interest in TGR in the form of shares of our Class A common stock, and an indirect ownership interest in Opco through TGR s ownership of Class A Units of Opco. By contrast, our initial stockholders will own founder shares and sponsor shares, which include direct economic interests in Opco in the form of Class A and Class B Units of Opco and a corresponding non-economic voting equity interest in TGR in the form of shares of our Class B common stock, as well as a direct economic and voting interest in the form of our Class A common stock. Shares of our Class A common stock and Class B common stock are entitled to vote on the same basis. Sponsor shares were purchased for $10.00 each and, in the absence of an initial business combination, will generally participate in liquidation or other payments on a pari passu basis with the shares of our Class A common stock purchased as part of units in this offering. However, given the small number of sponsor shares relative to the other public shares, in many cases the economic, governance or other effects of the sponsor shares are not material to the holders of our Class A common stock or warrants, and for simplicity, portions of this disclosure may not fully describe or reflect these immaterial effects. Following this offering, TGR will own a number of Class A Units of Opco equivalent to the number of shares of our Class A common stock outstanding after this offering, as well as a number of warrants to acquire Class A Units of Opco equivalent to the number of warrants to acquire shares of our Class A common stock outstanding after this offering, and will be the sole managing member of Opco. Opco will hold all of our material assets, including the trust account. The Opco Units are entitled to different economics by virtue of being held directly, rather than through TGR, which is subject to corporate income tax. Please see the risk factor entitled Our organizational structure confers certain benefits upon our initial stockholders that will not benefit the holders of our Class A common stock to the same extent as it will benefit our initial stockholders for additional information. In connection with our initial business combination, the Class B Units of Opco will convert into Class A Units of Opco on a one-for-one basis, subject to adjustment as provided under the caption in the offering summary Founder shares exchange and anti-dilution. The Class A Units and Class B Units of Opco are substantially similar other than certain distribution rights. In addition, following our initial business combination, our initial stockholders will have the right, subject to certain limitations and our option to purchase for cash, as further described herein, to exchange Class A Units of Opco (and a corresponding number of shares of our Class B common stock) for shares of our Class A common stock on a one-for-one basis, subject to adjustment as provided under the caption in the offering summary Founder shares exchange and anti-dilution. The shares of our Class B common stock comprising a portion of the founder shares and sponsor shares cannot be transferred without transferring a corresponding number of Class A Units or Class B Units of Opco, as applicable, and vice versa. Following any exchange of Class A Units of Opco, TGR will retain such Class A Units and cancel the corresponding shares of our Class B common stock. Please read Certain Relationships and Related Party Transactions Opco LLC Agreement. In connection with our initial business combination, we might choose to issue additional Opco Units (and corresponding shares of our Class B common stock) to participants in the business combination, such as sellers of assets or entities or financing sources. We believe that our Up-C structure provides us with significant advantages as it provides flexibility in structuring a variety of business combinations, including the flexibility to retain an Up-C structure following TABLE OF CONTENTS SUMMARY the business combination or restructure as a result of the business combination, depending on the nature and structure of the target and the efficiency and administrability of retaining our post-offering structure after the business combination. In addition, if we retain our Up-C structure, subsequent exchanges of Opco Units for shares of Class A common stock by the initial stockholders, or by owners of the target of a business combination, to the extent they receive Opco Units as consideration, may result in adjustments to the tax basis of the assets held by Opco at the time of the exchange, which adjustments would be allocated to TGR. These adjustments would not have been available to TGR absent such exchanges and may increase (for tax purposes) TGR s depreciation and amortization deductions and may also decrease TGR s gains (or increase its losses) on future dispositions of certain assets to the extent the increase in tax basis is allocated to those assets. Such increased deductions and losses and reduced gains may reduce the amount of tax that TGR would otherwise be required to pay in the future. While our Up-C structure differs from the structure of other special purpose acquisition companies, the terms of this offering are generally consistent with those of other special purpose acquisition companies. Please read Proposed Business Comparison of This Offering to Offerings by Other Special Purpose Acquisition Companies. The following diagram illustrates our simplified ownership structure after giving effect to this offering and the concurrent private placement of warrants to our sponsor. TABLE OF CONTENTS The Offering In making your decision whether to invest in our securities, you should take into account not only the identity of our sponsor and the experience of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors in this prospectus. Securities offered 20,000,000 units (or 23,000,000 units if the underwriter s over-allotment option is exercised in full), at $10.00 per unit, each unit consisting of: one share of Class A common stock; and one-half of one redeemable warrant to purchase one share of Class A common stock. NYSE symbols Units: TGR.U Class A Common Stock: TGR Warrants: TGR.WS Trading commencement and separation of Class A common stock and warrants The units will begin trading on or promptly after the date of this prospectus. The Class A common stock and warrants constituting the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day), unless UBS Securities LLC informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the shares of Class A common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of Class A common stock and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Additionally, the units will automatically separate into their component parts and will not be traded after completion of our initial business combination. Separate trading of the Class A common stock and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A common stock and warrants be traded separately until we have filed with the SEC a Current Report on Form 8-K that includes an audited balance sheet of our company reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering. If the underwriter s over-allotment option is exercised following TABLE OF CONTENTS The Offering the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriter s over-allotment option. Units: Number outstanding before this offering 0 Number outstanding after this offering 20,000,000(1) Common stock: Number outstanding before this offering 2,500 shares of our Class A common stock and 5,750,100 shares of our Class B common stock(2)(3) Number outstanding after this offering 20,002,500 shares of our Class A common stock and 5,000,100 shares of our Class B common stock(1)(3) Warrants: Number of private placement warrants to be sold in a private placement simultaneously with this offering 12,750,000(1) Number of warrants to be outstanding after this offering and the sale of private placement warrants 22,750,000(1) Exercisability Each whole warrant entitles the holder thereof to purchase one share of our Class A common stock, subject to adjustment as provided herein, and only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Upon the exercise of a warrant to purchase one share of our Class A common stock, TGR will exercise a corresponding warrant to acquire one Class A Unit of Opco. We structured each unit to contain one-half of one warrant, with each whole warrant exercisable for one share of Class A common stock, as compared to units issued by some other similar blank check companies which contain whole warrants exercisable for one whole share, in order to reduce the dilutive effect of the warrants upon completion of our initial business combination as compared to units that each contain a warrant to purchase one whole share, thus making us, we believe, a more attractive business combination partner for target businesses. (1) Assumes no exercise of the underwriter s over-allotment option and the forfeiture by our sponsor of 750,000 founder shares. The shares of common stock included in the units are shares of our Class A common stock. (2) Includes up to 750,000 shares of our founder shares that are subject to forfeiture by our sponsor depending on the extent to which the underwriter s over-allotment option is exercised. (3) The Class B common stock comprise a portion of the founder shares and the sponsor shares. For each share of our Class B common stock there is a corresponding Class A or Class B Unit of Opco. Class B Units of Opco will automatically convert into Class A Units of Opco in connection with our initial business combination on a one-for-one basis, subject to adjustment as provided herein. See Founder shares conversion. The Class A Units of Opco (together with the corresponding shares of our Class B common stock) that comprise the founder shares and sponsor shares will be exchangeable into shares of our Class A common stock after the time of our initial business combination on a one-for-one basis. Each share of our Class B common stock has no economic rights but entitles its holder to one vote. TABLE OF CONTENTS The Offering Exercise price $11.50 per whole share, subject to adjustment as described herein. In addition, if (x) we issue additional shares of our Class A common stock or equity-linked securities for capital raising purposes in connection with the consummation of our initial business combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price to be determined in good faith by our Board and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or KRP or its other subsidiaries, as applicable) (the Newly Issued Price ), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the completion of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our Class A common stock during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the Market Value ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price described below under Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00 will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. Exercise period The warrants will become exercisable 30 days after the completion of our initial business combination provided that we have an effective registration statement under the Securities Act covering the issuance of the shares of our Class A common stock issuable upon exercise of the warrants and a current prospectus relating to them is available and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). We have agreed that as soon as practicable, but in no event later than 20 business days after the consummation of our initial business combination, we will use our commercially reasonable efforts to file a post-effective amendment to the registration statement for this offering or a new registration statement with the SEC under the Securities Act covering the shares of Class A common stock issuable upon exercise of the warrants. We will use our commercially reasonable efforts to cause the same to become effective and to maintain the effectiveness of such registration statement or post-effective amendment to the registration statement for this offering, and a current prospectus relating thereto, until the expiration of the warrants in accordance with the provisions TABLE OF CONTENTS The Offering of the warrant agreement. Notwithstanding the above, if our Class A common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, but we will use our commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00 Once the warrants become exercisable, we may redeem the outstanding warrants; in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period; and if, and only if, the last reported sale price of our Class A common stock equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading Description of Securities Warrants Public Stockholders Warrants Anti-dilution Adjustments ) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrantholders. We will not redeem the warrants for cash unless a registration statement under the Securities Act covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants is then effective and a current prospectus relating to those shares of Class A common stock is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In determining whether to require all holders to exercise TABLE OF CONTENTS The Offering their warrants on a cashless basis, our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our stockholders of issuing the maximum number of shares of Class A common stock issuable upon the exercise of our warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A common stock underlying the warrants, multiplied by the excess of the fair market value of our Class A common stock (defined below) over the exercise price of the warrants by (y) the fair market value. See Description of Securities Warrants Public Stockholders Warrants for additional information. The fair market value of our shares of Class A common stock shall mean the volume weighted average price of our shares of Class A common stock as reported during the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. This redemption feature differs from the typical warrant redemption features used in other blank check offerings. Extensions of time to complete business combination If we anticipate that we may not be able to consummate our initial business combination within 15 months, the sponsor may cause us to extend the available time to consummate our initial business combination by up to two successive three-month periods. In order to exercise each three-month extension option, our sponsor must deposit into the trust account $0.10 per public share (a total of $2,000,000, or $2,300,000 if the underwriters over-allotment option is exercised in full) on or prior to the date of the applicable deadline. The sponsor may exercise the extension option up to two times, allowing for up to an additional six months (for a total of 21 months) to complete an initial business combination. The sponsor or its affiliates or designees will receive a non-interest bearing, unsecured promissory note equal to the amount of any such deposit that will not be repaid in the event that we are unable to complete an initial business combination unless there are funds available outside the trust account to do so. Such notes would either be paid upon consummation of our initial business combination, or, at the sponsor s discretion, converted upon consummation of our initial business combination into additional private placement warrants at a price of $1.00 per warrant. In the event that we receive notice from the sponsor five days prior to the applicable deadline of its intent to exercise an extension option, we intend to issue a press release announcing such intention to exercise the extension option at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the applicable deadline announcing whether the funds were timely deposited. The sponsor and its affiliates or designees are not TABLE OF CONTENTS The Offering obligated to fund the trust account to extend the time for us to complete our initial business combination. Any notes issued pursuant to these loans would be in addition to any notes issued pursuant to working capital loans made to us. Voting rights With respect to any matter submitted to a vote of our stockholders, including any vote in connection with our initial business combination, except as required by applicable law or stock exchange rule, holders of our Class A common stock and holders of our Class B common stock will vote together as a single class, with each share entitling the holder to one vote. Following our initial business combination, holders of our Class A common stock and holders of our Class B common stock will generally vote together as a single class on matters presented for a stockholder vote, except as required by Delaware law or stock exchange rule, with each share of our common stock entitling the holder to one vote. Founder shares In May 2021, our sponsor purchased an aggregate of 5,750,000 shares of Class B common stock, par value $0.0001 per share, for an aggregate purchase price of $25,000 and our sponsor was issued an aggregate of 5,750,000 Class B Units of Opco, which together comprise the founder shares. The number of founder shares issued was determined based on the expectation that the founder shares would represent 20% of the outstanding shares of common stock upon the completion of this offering. Prior to the initial investment in the company of $25,000 by our sponsor, the company had no assets, tangible or intangible. If we increase or decrease the size of this offering, we will effect a stock dividend or share contribution back to capital or other appropriate mechanism, as applicable, with respect to our Class B common stock immediately prior to the consummation of this offering in such amount as to maintain the number of founder shares at 20% of the outstanding shares of our common stock upon the consummation of this offering (and Opco will make similar adjustments to the corresponding Class B Units of Opco). Up to an aggregate of 750,000 founder shares are subject to forfeiture by our sponsor depending on the extent to which the underwriter s over-allotment option is exercised so that the founder shares held will continue to represent 20% of the outstanding shares of our common stock upon the consummation of this offering. Together, the founder shares are substantially similar to the shares of Class A common stock included in the units being sold in this offering, except that: the founder shares consist of Class B Units of Opco (and any Class A Units of Opco into which such Class B Units are converted) and a corresponding number of shares of our Class B common stock, which together will be exchangeable for shares of our Class A common stock after the time of our initial business combination TABLE OF CONTENTS The Offering on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described herein; following our initial business combination, holders of our Class A common stock and holders of our Class B common stock will generally vote together as a single class on matters presented for a stockholder vote, except as required by Delaware law or stock exchange rule, with each share of our common stock entitling the holder to one vote; the founder shares are subject to certain transfer restrictions, as described in more detail below; pursuant to the Opco LLC Agreement and a letter agreement that our sponsor, officers and directors have entered into with us, they have agreed (i) that any founder shares and sponsor shares held by them will not be entitled to redemption rights, and they will waive any such redemption rights for any public shares held by them, in connection with the completion of our initial business combination, (ii) that any founder shares and sponsor shares held by them will not be entitled to redemption rights, and they will waive any such redemption rights for any public shares held by them, in connection with a stockholder vote to amend our amended and restated certificate of incorporation in a manner that would affect the substance or timing of our obligation to redeem 100% of our public shares if we have not consummated an initial business combination within 15 months from the closing of this offering (or up to 21 months if the sponsor exercises its extension options), (iii) that any founder shares held by them are subject to forfeiture, and thus will not be entitled to liquidating distributions from the trust account, and they will waive any such rights to liquidating distributions for any founder shares, if we fail to complete our initial business combination within 15 months from the closing of this offering (or up to 21 months if the sponsor exercises its extension options) (although they will be entitled to liquidating distributions from the trust account with respect to any public shares and sponsor shares they hold if we fail to complete our business combination within the prescribed time frame), and (iv) in certain limited circumstances the Class B Units of Opco will have more limited rights to current or liquidating distributions from us. If we submit our initial business combination to our public stockholders for a vote, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. Our initial stockholders have agreed to vote any founder shares and sponsor shares held by them and any public shares purchased during or after this offering in favor of our initial business combination. As a result, in addition to our initial stockholders founder shares and sponsor shares, we would need 7,500,001, or 37.5% (assuming TABLE OF CONTENTS The Offering all outstanding shares are voted and the over-allotment option is not exercised), or 1,250,001, or 6.25% (assuming only the minimum number of shares representing a quorum are voted and the over-allotment option is not exercised), of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have such initial business combination approved; and the Class A common stock into which the founder shares are exchangeable are entitled to registration rights. Transfer restrictions on founder shares Our initial stockholders have agreed not to transfer, assign or sell any founder shares or sponsor shares held by them, and any shares of our Class A common stock acquired upon exchange of founder shares or sponsor shares, until the earlier to occur of: (1) one year after the completion of our initial business combination; and (2) subsequent to our initial business combination, (x) the date on which we complete a liquidation, merger, stock exchange, reorganization or other similar transaction that results in all of our public stockholders having the right to exchange their shares of common stock for cash, securities or other property or (y) if the last reported sale price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations, and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, subject to certain exceptions described herein under Principal Stockholders Transfers of Founder Shares and Private Placement Warrants. Any permitted transferees as described herein under Principal Stockholders Transfers of Founder Shares and Private Placement Warrants would be subject to the same restrictions and other agreements as our sponsor with respect to any founder shares. We refer to such transfer restrictions throughout this prospectus as the lock-up. The shares of our Class B common stock comprising a portion of the founder shares and sponsor shares cannot be transferred without transferring a corresponding number of Class B Units of Opco (or the Class A Units of Opco into which such Class B Units will convert in connection with our initial business combination) and vice versa. Sponsor shares In May 2021, our sponsor purchased 100 Class A Units of Opco and a corresponding number of shares of our Class B common stock (which together will be exchangeable into shares of Class A common stock after our initial business combination on a one-for-one basis) and 2,500 shares of our Class A common stock. Founder shares conversion We have outstanding 5,750,000 founder shares, which include shares of our Class B common stock and Class B Units of Opco (or the Class A Units of Opco into which such Class B Units will convert in connection with our initial business combination). The Class B Units of Opco will TABLE OF CONTENTS The Offering convert into Class A Units of Opco in connection with our initial business combination on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like, subject to further adjustment and subject, in part, to forfeiture if the underwriter s over-allotment option is not exercised as provided herein. The founder shares consist of Class B Units of Opco (and any Class A Units of Opco into which such Class B Units are converted) and a corresponding number of shares of our Class B common stock, which together will be exchangeable for shares of our Class A common stock after the time of our initial business combination (as described above) on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like and subject to further adjustment as provided herein. In the case that additional shares of our Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts sold in this offering and related to the closing of the initial business combination, the number of Class A Units of Opco into which the Class B Units of Opco will convert may be adjusted (unless the holders of a majority of the outstanding founder shares agree to waive such adjustment with respect to any such issuance or deemed issuance) so that, after all founder shares have been exchanged for shares of our Class A common stock, the aggregate number of shares of our Class A common stock received by holders in exchange for founder shares would equal 20% of the sum of the total outstanding shares of our Class A common stock upon the completion of this offering (excluding the sponsor shares and any shares issuable upon exercise of any warrants) plus all shares of our Class A common stock and equity-linked securities issued or deemed issued in connection with the business combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in the business combination). In addition, the number of outstanding shares of our Class B common stock will be adjusted through a stock split or stock dividend so that the total number of outstanding shares of our Class B common stock corresponds to the total number of Class A Units of Opco outstanding (other than those held by TGR) plus the total number of Class A Units of Opco into which the Class B Units of Opco are entitled to convert. Private placement warrants Our sponsor expects to purchase an aggregate of 12,750,000 private placement warrants (or 14,100,000 if the underwriter s over-allotment option is exercised in full) at a price of $1.00 per warrant ($12,750,000 in the aggregate, or $14,100,000 in the aggregate if the underwriter s over-allotment option is exercised in full) in a private placement that will close simultaneously with the closing of this offering. Each private placement warrant entitles the holder thereof to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment as provided herein. A portion of the purchase price of the private placement TABLE OF CONTENTS The Offering warrants will be added to the proceeds from this offering to be held in the trust account. If we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months if the sponsor exercises its extension options), the proceeds of the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares and any Class A Units of Opco (other than those held by TGR) (subject to the requirements of applicable law) and the private placement warrants will expire worthless. Transfer restrictions on private placement warrants The private placement warrants will not be transferable, assignable or saleable until 30 days after the completion of our initial business combination, except as described below under Principal Stockholders Transfers of Founder Shares and Private Placement Warrants. Proceeds to be held in trust account The rules of the NYSE provide that at least 90% of the gross proceeds from this offering and the sale of the private placement warrants be deposited in a trust account. We will use the proceeds we receive from this offering and the sale of the private placement warrants to purchase Class A Units and warrants in Opco. Opco will deposit approximately $206.0 million, or $10.30 per unit (approximately $236.9 million, or $10.30 per unit, if the underwriter s over-allotment option is exercised in full), into a U.S.-based trust account with Continental Stock Transfer & Trust Company acting as trustee and will use $4.95 million to pay expenses in connection with the closing of this offering and for working capital following this offering. The proceeds to be placed in the trust account include $7.0 million (or $8.1 million if the underwriter s over-allotment option is exercised in full) in deferred underwriting commissions. The funds in the trust account will be invested only in U.S. government treasury bills with a maturity of 185 days or less or in money market funds investing solely in U.S. Treasuries. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay tax obligations of the Company or Opco, if any, the funds held in the trust account will not be released from the trust account until the earliest of: (1) the completion of our initial business combination (including the release of funds to pay any amounts due to any public stockholders who properly exercise their redemption rights in connection therewith); (2) the redemption of any public shares (other than sponsor shares) properly submitted in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation (A) in a manner that would affect the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months, if the sponsor exercises its extension options) or (B) with respect to any other provision relating to the rights of holders of our Class A TABLE OF CONTENTS The Offering common stock or pre-initial business combination activity; and (3) the redemption of our public shares and any Class A Units of Opco (other than those held by TGR) if we have not completed our initial business combination within 15 months from the closing of this offering (or up to 21 months if the sponsor exercises its extension options), subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. Anticipated expenses and funding sources Unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use, except the withdrawal of interest to pay taxes or to redeem our public shares in connection with an amendment to our certificate of incorporation, as described above. The funds in the trust account will be invested only in U.S. government treasury bills with a maturity of 185 days or less or in money market funds investing solely in U.S. Treasuries and meeting certain conditions under Rule 2a-7 under the Investment Company Act. Assuming that the proceeds held in the trust account are only invested in such money market funds at a current interest rate of 0.01% per year, we estimate the interest earned on the trust account will be approximately $20,600 per year; however, we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement warrants not held in the trust account, which will be approximately $3.45 million (including $1.2 million in expenses the underwriter has agreed to reimburse us) in working capital after the payment of approximately $1.5 million in expenses relating to this offering; and any loans or additional investments from our sponsor, members of our management team or KRP or any of its subsidiaries or other third parties, although they are under no obligation or other duty to loan funds to, or invest in, us, and provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of our initial business combination. If we complete our initial business combination, we expect to repay any such loaned amounts out of the proceeds of the trust account released to us. In the event that our initial business combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust account would be used to repay such loaned amounts. Up to $1,500,000 of such loans made to us by our sponsor, KRP or its subsidiaries may be convertible into warrants at a price of $1.00 per warrant TABLE OF CONTENTS The Offering at the option of the lender. The warrants would be identical to the private placement warrants issued to our sponsor. Conditions to completing our initial business combination There is no limitation on our ability to raise funds privately or through loans in connection with our initial business combination. The NYSE listing rules require that our initial business combination must be with one or more target businesses that have an aggregate fair market value equal to at least 80% of the value of the trust account (excluding any deferred underwriting commissions and taxes payable on interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. If our Board is not able to independently determine the fair market value of the target business or businesses or we are considering an initial business combination with an affiliated entity, we will obtain an opinion from an independent investment banking firm that is a member of FINRA or an independent accounting firm. Our stockholders may not be provided with a copy of such opinion nor will they be able to rely on such opinion. We anticipate structuring our initial business combination so that we will control 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that we control less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders or for other reasons, including, but not limited to, an Affiliated Joint Acquisition. However, we will only complete such business combination if we control 50% or more of the outstanding voting securities of the target or otherwise are not required to register as an investment company under the Investment Company Act. Even if we control 50% or more of the voting securities of the target, our stockholders prior to the business combination may collectively own a minority interest in the post-business combination company, depending on valuations ascribed to the target and us in the business combination transaction. If we control less than 100% of the equity interests or assets of a target business or businesses, the portion of such business or businesses that is controlled is what will be taken into account for purposes of the NYSE s 80% of net assets test, provided that in the event that the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the transactions and we will treat the transactions together as our initial business combination for purposes of seeking stockholder approval or for purposes of a tender offer, as applicable. Permitted purchases and other transactions with respect to our securities by our sponsor, insiders and the related companies If we seek stockholder approval of our initial business combination and we do not conduct redemptions or TABLE OF CONTENTS The Offering repurchases in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, officers, or advisors or any of the related companies and their directors, officers and advisors may purchase public shares or public warrants or a combination thereof in privately negotiated transactions or in the open market, either prior to or following the completion of our initial business combination, although they are under no obligation or other duty to do so. There is no limit on the number of securities such persons may purchase, or any restriction on the price that they may pay. Any such price per share may be different than the amount per share a public stockholder would receive if it elected to redeem its shares in connection with our initial business combination. Additionally, at any time at or prior to our initial business combination, subject to applicable securities laws (including with respect to material non-public information), our sponsor, directors, officers, or advisors or any of the related companies and their directors, officers and advisors may enter into transactions with investors and others to provide them with incentives to acquire public shares, vote their public shares in favor of our initial business combination or not redeem their public shares. However, such persons have no current commitments, plans or intentions to engage in such purchases or other transactions and have not formulated any terms or conditions for any such purchases or other transactions. None of the funds in the trust account will be used to purchase public shares or public warrants in such transactions. Such persons will be subject to restrictions in making any such purchases when they are in possession of any material non-public information or if such purchases are prohibited by Regulation M under the Exchange Act. See Proposed Business Permitted purchases and other transactions with respect to our securities for a description of how our sponsor, directors, officers, advisors or any of their affiliates will select which stockholders to purchase securities from in any private transaction. The purpose of any such transaction could be to (1) vote such shares in favor of the initial business combination and thereby increase the likelihood of obtaining stockholder approval of the initial business combination, (2) reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrantholders for approval in connection with our initial business combination or (3) satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the consummation of our initial business combination, where it appears that such requirement would otherwise not be met. Any such transactions may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our shares of Class A common stock or warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the TABLE OF CONTENTS The Offering quotation, listing or trading of our securities on a national securities exchange. There is no limit on the number of public shares and public warrants that our sponsor, directors, officers, advisors or any of their affiliates may purchase pursuant to the transactions described above. Redemption rights for public stockholders upon completion of our initial business combination We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to pay taxes of the company or Opco, divided by the number of then outstanding public shares and Class A Units of Opco (other than those held by TGR), subject to the limitations described herein. The amount in the trust account is initially anticipated to be approximately $10.30 per public share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriter. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Pursuant to the Opco LLC Agreement and a letter agreement that our sponsor, officers and directors have entered into with us, they have agreed that any founder shares and sponsor shares held by them will not be entitled to redemption rights, and they will waive any such redemption rights for any public shares held by them, in connection with the completion of our initial business combination. In connection with the redemption of any public shares, a corresponding number of Class A Units of Opco held by us will also be redeemed. Limitations on redemptions Our amended and restated certificate of incorporation will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001. In addition, our proposed initial business combination may impose a minimum cash requirement for (i) cash consideration to be paid to the target or its owners, (ii) cash for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions. In the event the aggregate cash consideration we would be required to pay for all shares of our Class A common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will not complete the initial business combination or redeem any shares in connection with such initial business combination, and all shares of our Class A common stock submitted for redemption will be returned to the holders thereof. TABLE OF CONTENTS The Offering Manner of conducting redemptions We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either: (1) in connection with a stockholder meeting called to approve the business combination; or (2) by means of a tender offer. Except as required by Delaware law or stock exchange rule, the decision as to whether we will seek stockholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction. Asset acquisitions and stock purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding common stock or seek to amend our amended and restated certificate of incorporation would typically require stockholder approval. We intend to conduct redemptions or repurchases without a stockholder vote pursuant to the tender offer rules of the SEC unless stockholder approval is required by applicable law or stock exchange rule or we choose to seek stockholder approval for business or other reasons. If we hold a stockholder vote to approve our initial business combination, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and file proxy materials with the SEC. If we seek stockholder approval, we will complete our initial business combination only if a majority of the shares of our common stock voted are voted in favor of the business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the company representing a majority of the voting power of all outstanding shares of capital stock of the company entitled to vote at such meeting. Our initial stockholders will count toward this quorum and have agreed to vote their founder shares, sponsor shares and any public shares purchased during or after this offering in favor of our initial business combination. For purposes of seeking approval of the majority of our outstanding shares of common stock voted, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. As a result, in addition to our sponsor s founder shares and sponsor shares, we would need 7,500,001, or 37.5% (assuming all outstanding shares are voted and the over-allotment option is not exercised), or 1,250,001, or 6.25% (assuming only the minimum number of shares representing a quorum are voted and the over-allotment option is not exercised), of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved. We intend to give approximately 30 days (but TABLE OF CONTENTS The Offering not less than 10 days nor more than 60 days) prior written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination. These quorum and voting thresholds, and the voting agreements of our initial stockholders, may make it more likely that we will consummate our initial business combination. Each public stockholder may elect to redeem its public shares irrespective of whether they vote for or against the proposed transaction or vote at all. We may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to either tender their certificates to our transfer agent prior to the date set forth in the proxy solicitation or tender offer materials mailed to such holders, or up to two business days prior to the initially scheduled vote on the proposal to approve the business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically. We believe that this will allow our transfer agent to efficiently process any redemptions without the need for further communication or action from the redeeming public stockholders, which could delay redemptions and result in additional administrative cost. If the proposed business combination is not approved and we continue to search for a target business, we will promptly return any certificates delivered, or shares tendered electronically, by public stockholders who elected to redeem their shares. If a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other reasons, we will, pursuant to our amended and restated certificate of incorporation: conduct the redemptions or repurchases pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about our initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Although we are not required to do so, we currently intend to comply with the substantive and procedural requirements of Regulation 14A in connection with any stockholder vote even if we are not able to maintain our NYSE listing or Exchange Act registration. Upon the public announcement of our initial business combination, if we elect to conduct redemptions or repurchases pursuant to the tender offer rules, we and our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase shares of our Class A common stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act. TABLE OF CONTENTS The Offering In the event we conduct redemptions or repurchases pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public stockholders not tendering more than the number of public shares we are permitted to redeem. If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination. In addition, if we conduct redemptions in connection with a stockholder vote, we intend to require a public stockholder seeking redemption of its public shares to also submit a written request for redemption to our transfer agent two business days prior to the scheduled vote in which the name of the beneficial owner of such shares is included. Limitation on redemption rights of stockholders holding 20% or more of our Class A common stock if we hold stockholder vote Notwithstanding the foregoing redemption rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions or repurchases in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 20% of our Class A common stock, without our prior consent. We believe the restriction described above will discourage stockholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public stockholder holding more than an aggregate of 20% of our Class A common stock could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us, our sponsor or our management at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem to no more than 20% of our Class A common stock, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders ability to vote all of their shares (including all shares held by those stockholders that hold more than 20% of our Class A common stock) for or against our initial business combination. TABLE OF CONTENTS The Offering Redemption rights in connection with proposed amendments to our certificate of incorporation Some other blank check companies have a provision in their charter which prohibits the amendment of certain charter provisions. Our amended and restated certificate of incorporation will provide that any of its provisions related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the private placement warrants into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein) may be amended if approved by holders of 65% of our common stock entitled to vote thereon, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of 65% of our common stock entitled to vote thereon. In all other instances, our amended and restated certificate of incorporation may be amended by holders of a majority of our outstanding common stock entitled to vote thereon, subject to applicable provisions of the DGCL or applicable stock exchange rules. Our initial stockholders, who will beneficially own shares representing 20% of the total outstanding shares of our Class A common stock upon the closing of this offering (assuming the exchange of all the founder shares for Class A common stock and that they do not purchase any units in this offering and excluding the sponsor shares), will participate in any vote to amend our amended and restated certificate of incorporation and/or trust agreement and will have the discretion to vote in any manner they choose. Our sponsor, officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation that would affect the substance or timing of our obligation to redeem 100% of our public shares if we have not consummated an initial business combination within 15 months from the closing of this offering (or up to 21 months if the sponsor exercises its extension options), unless we provide our public stockholders with the opportunity to redeem their shares of our Class A common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to pay taxes of the company or Opco, divided by the number of then outstanding public shares and Class A Units of Opco (other than those held by TGR), subject to the limitations described above under Limitations on redemptions. For example, our Board may propose such an amendment if it determines that additional time is necessary to complete our initial business combination. Pursuant to our amended and restated certificate of incorporation, such an amendment would need to be approved by the affirmative vote of the holders of at least 65% of all then outstanding shares of our common stock. In such event, we will conduct TABLE OF CONTENTS The Offering a proxy solicitation and distribute proxy materials pursuant to Regulation 14A of the Exchange Act seeking stockholder approval of such proposal, and in connection therewith, provide our public stockholders with the redemption rights described above upon stockholder approval of such amendment. This redemption right shall apply in the event of the approval of any such amendment, whether proposed by our sponsors, any executive officer, director or director nominee, or any other person. In connection with the redemption of any public shares, a corresponding number of Class A Units of Opco held by us will also be redeemed. Release of funds in trust account on consummation of our initial business combination On the completion of our initial business combination, all amounts held in the trust account will be disbursed directly by the trustee or released to us to pay amounts due to any public stockholders who properly exercise their redemption rights as described above under Redemption rights for public stockholders upon completion of our initial business combination, to pay the underwriter its deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or used for redemption of our public shares, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other businesses, for share repurchases or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our sponsor, executive officers and directors will agree that we will have only 15 months from the closing of this offering to complete our initial business combination (or up to 21 months if the sponsor exercises its extension options). In the event that we receive notice from the sponsor five days prior to the applicable deadline of its intent to exercise an extension option, we intend to issue a press release announcing such intention to exercise the extension option at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the applicable deadline announcing whether the funds were timely deposited. If we have not completed our initial business combination within such 15-month period (or up to 21-month period if the sponsor exercises its extension options), we will: (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably possible but not more than TABLE OF CONTENTS The Offering 10 business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (less an amount required to satisfy taxes of the company and Opco and up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares and Class A Units of Opco (other than those held by TGR), which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any); and (3) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our Board, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within such 15-month period (or up to 21-month period if the sponsor exercises its extension options). Pursuant to the Opco LLC Agreement and a letter agreement that our sponsor, officers and directors have entered into with us, they have agreed that any founder shares are subject to forfeiture, and thus will not be entitled to liquidating distributions from the trust account, and they will waive any such rights to liquidating distributions for any founder shares, if we fail to complete our initial business combination within 15 months from the closing of this offering (or up to 21 months if the sponsor exercises its extension options). However, if our initial stockholders or management team acquire public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares and the sponsor shares if we fail to complete our initial business combination within the allotted 15-month time period (or up to 21-month period if the sponsor exercises its extension options). The underwriter has agreed to waive its rights to their deferred underwriting commission held in the trust account in the event we do not complete our initial business combination and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares and any Class A Units of Opco (other than those held by TGR). Limited payments to insiders There will be no finder s fees, reimbursements or cash payments made by us to our sponsor, KRP or its other subsidiaries, or their officers or directors, for services rendered to us prior to or in connection with the completion of our initial business combination, other than the following payments, none of which will be made from the proceeds of this offering and the sale of the private placement warrants held in the trust account prior to the completion of our initial business combination: TABLE OF CONTENTS The Offering repayment of an aggregate of $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; payment to certain subsidiaries of KRP of a total of $25,000 per month for administrative and support services; payment of an annual fee of $60,000, payable in cash, to each of our independent directors for service on our Board; reimbursement for any out-of-pocket expenses related to identifying, investigating and completing our initial business combination; and repayment of loans which may be made by our sponsor or KRP or its other subsidiaries to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans made to us may be convertible into warrants at a price of $1.00 per warrant at the option of the lender. These payments may be funded using the net proceeds of this offering and the sale of the private placement warrants, in each case to the extent not held in the trust account or, upon the consummation of the initial business combination, from any amounts remaining from the proceeds of the trust account released to us in connection therewith. In addition, we have agreed, pursuant to the administrative services agreement with our sponsor relating to the monthly reimbursement for office space and administrative services described above, that we will indemnify our sponsor from any claims arising out of or relating to this offering or the company s or Opco s operations or conduct of the company s or Opco s business or any claim against our sponsor alleging any expressed or implied management or endorsement by our sponsor of any of the company s or Opco s activities or any express or implied association between our sponsor and the company or Opco or any of their affiliates, which agreement will provide that the indemnified parties cannot access the funds held in our trust account. Our audit committee will review on a quarterly basis all payments that were made by us to our sponsor, officers or directors or KRP or its other subsidiaries. Audit committee Prior to the effectiveness of the registration statement of which this prospectus forms a part, we will have established and will maintain an audit committee to, among other things, monitor compliance with the terms described above. If any noncompliance is identified, then the audit committee will be charged with the responsibility to promptly take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. See Management Committees of the Board of Directors Audit Committee. TABLE OF CONTENTS The Offering Conflicts of interest As described under Proposed Business Conflicts of Interest and Management Conflicts of Interest, each of our officers and directors has, and any of them in the future may have, additional fiduciary or contractual obligations to one or more other entities pursuant to which such officer or director may be required to present a business combination opportunity to such entities before he or she presents such opportunity to us. Also, none of KRP, our sponsor or any of our directors and officers is prohibited from sponsoring, investing or otherwise becoming involved with, any other blank check companies, including in connection with their initial business combinations. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity to which he or she has then-current fiduciary or contractual obligations to present such opportunity to another entity, he or she may only present such opportunity to us if such other entity rejects the opportunity. Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company; such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue; and such person has no fiduciary or contractual obligation to present the opportunity to any other person or entity. Additionally, none of KRP, our sponsor or any other entity currently has any obligation or duty to provide us with any potential business combination opportunity. In addition, KRP will adopt a policy pursuant to which any business combination opportunity that is a corporate opportunity of KRP that may also be a business combination opportunity for our company will first be presented to the conflicts committee of the board of directors of KRP, which is made up solely of independent directors, for consideration as to whether KRP desires to pursue such business combination opportunity as a direct investment or to present such opportunity to our company for consideration. The members of the conflicts committee of the board of directors of KRP will not serve in any fiduciary capacity at our company. For more information, including a list of our executive officers and directors and entities for which a conflict of interest may or does exist between such officers and the company, see Proposed Business Conflicts of Interest and Management Conflicts of Interest. We do not believe, however, that the fiduciary, contractual or other obligations or duties of our officers or directors or the KRP policy described above will materially affect our ability to complete our initial business combination. Indemnity Our sponsor will agree that it will be liable to us if and to the extent any claims by a third party (other than our TABLE OF CONTENTS The Offering independent registered public accounting firm) for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below the lesser of: (1) $10.30 per public share (or $10.40 or $10.50, if applicable); and (2) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the amount of interest which may be withdrawn to pay taxes of the company or Opco, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriter of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third-party claims. We have not independently verified whether our sponsor, which is a newly formed entity, has sufficient funds to satisfy its indemnity obligations and believe that our sponsor s only assets are securities of our company and, therefore, our sponsor may not be able to satisfy those obligations. We have not asked our sponsor to reserve for such obligations. Therefore, we cannot assure you that our sponsor would be able to satisfy those obligations. As a result, if any such claims were successfully made against the trust account, the funds available for our initial business combination and redemptions could be reduced to less than $10.30 per public share (or $10.40 or $10.50 per public share, if applicable). In such event, we may not be able to complete our initial business combination, and you would receive such lesser amount per share in connection with any redemption of your public shares. None of our officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses. TABLE OF CONTENTS
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: we, us, company or our company are to Vistas Acquisition Company II Inc., a Cayman Islands exempted company; Companies Act refers to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; directors are to our current directors and director nominees; founder shares are to Class B ordinary shares initially purchased by our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination as described herein; initial shareholders are to holders of our founder shares prior to this offering; management or our management team are to our executive officers and directors; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private placement are to a subscription of 486,500 units (or 516,500 units in the aggregate if the underwriters option to purchase additional units is exercised in full) at a price of $10.00 per unit ($4,865,000 in the aggregate, or $5,165,000 in the aggregate if the underwriters option to purchase additional units is exercised in full) by our sponsor in a private placement that will close simultaneously with the closing of this offering; private placement units are to the units issued to our sponsor in the private placement simultaneously with the closing of this offering; private shares are to the Class A ordinary shares underlying the private placement units; private warrants are to the warrants underlying the private placement units as well as the warrants underlying the private placement units that may be issued upon conversion of working capital loans; public shareholders are to the holders of our public shares, including our initial shareholders and management team to the extent our initial shareholders and/or members of our management team purchase public shares, provided that each initial shareholder s and member of our management team s status as a public shareholder will only exist with respect to such public shares; public shares are to the Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); sponsor are to Vistas Acquisition Sponsor II LLC, a Delaware limited liability company, an affiliate of Vistas Media; Vistas Media or Vistas Media Capital are to Vistas Media Capital Pte. Ltd., a media investment holding company registered in the Republic of Singapore and its affiliates; and VMAC are to Vistas Media Acquisition Company Inc. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any forfeiture of shares, and all references to forfeiture of shares, described in this prospectus shall take effect as a surrender of shares for no consideration as a matter of Cayman Islands law. Any share dividend described in this prospectus will take effect as a share capitalization as a matter of Cayman Islands law. 1 Table of Contents Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. GENERAL We are a blank check company newly incorporated as a Cayman Islands exempted company with limited liability for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any potential business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any potential business combination target regarding an initial business combination with our company. While we may pursue an initial business combination target in any business, industry, or geographic location, we intend to focus on industries that complement our team s experience and background, and to capitalize on the ability of our management team, directors and strategic advisors to identify and acquire a business within the technology, media and entertainment sector with special emphasis on: Consumer Technology Consumer technology refers to any form of technology that is intended for use by public consumers, as opposed to technology created for governmental, military, or commercial use. Consumer technology comes in a variety of different forms that are applied in many of the most commonly seen consumer products and services that people utilize daily. Within the consumer technology space, we intend to focus on businesses in the high growth sectors globally (with a primary focus on the Asia Pacific, European and Middle Eastern regions), including logistics and supply chain, education technology, financial technology, e-Commerce, and digital marketplaces. Media and Entertainment Vistas Media is a media content and technology company headquartered in Singapore with a global footprint across the ecosystem of media and entertainment ( M&E ). Vistas Media is constantly evaluating new investment opportunities to further strengthen the value chain across geographies within the M&E space, including content, film, visual effects facilities, animation, streaming, augmented and virtual reality, music, digital media, gaming and e-sports and blockchain technology enabled new media firms. As a result, significant inroads and relationships have been developed with the M&E sector across the value chain, in key geographies such as India, USA, Canada, UK and the Middle East & North Africa (MENA) region. We intend to focus specifically on companies that are positioned to benefit directly from the growth of media technology and digitally available content. We intend to search globally (with a primary focus on the Asia Pacific, European and Middle Eastern regions) for target companies within the technology sector, having an enterprise value in the range of $600 million to $1 billion, with a specific focus on the above sub-sectors. We shall not undertake our initial business combination with any entity with its principal business operations in China (including Hong Kong and Macau). We will leverage the substantial proprietary deal sourcing, investing and operating expertise of our management team, directors and strategic advisors, including their relationships with leading business leaders and entrepreneurs. Our sourcing process will leverage the extensive global networks of our team, built over the last several decades, which we believe should provide us with a number of attractive business combination targets. Our sponsor is supported by Meteora, an investment adviser specializing in SPACs. Meteora s principals have prior experience across the full lifecycle of SPACs from the initial public offering to the business combination. Meteora will provide resources, including a network of relationships, an extensive SPAC knowledge base and a standardized SPAC operating system to streamline the business combination process. Furthermore, Meteora has diverse sector experience across technology, media and telecommunications, energy, consumer and retail, business and distribution services, aerospace and defense, healthcare, and fintech. Meteora is not acting as an underwriter in connection with this offering. Our Sponsor Vistas Acquisition Sponsor II LLC, our sponsor, is owned by Vistas Media Capital Pte. Ltd., a Singapore-based investment holding company whose key businesses and investments lie at the intersection of technology and media. Through Vistas Media Capital s network and offices across Singapore, India, the U.A.E., the USA and Canada, significant inroads and relationships have been developed and grown within the technology and media sectors. 2 Table of Contents In August 2020, Vistas Media Acquisition Company Inc. (Nasdaq: VMAC) consummated its initial public offering, generating gross proceeds of $100,000,000, and its securities began trading on Nasdaq. Vistas Media Capital Pte. Ltd. is the parent of VMAC s sponsor, Vistas Media Sponsor LLC. In March 2021, VMAC entered into a definitive business combination agreement with Anghami Inc. ( Anghami ), the leading music streaming platform in the Middle East and North Africa. Upon consummation of the transaction on February 4, 2022, Anghami became the first Arab technology company to be listed on Nasdaq. We will continue to leverage the deep relationships and long-standing experience that our management team, strategic advisors and directors have developed in the global media, technology, finance, global private equity, asset management, investment banking and consulting industries. We believe that this combination of relationships and experience will put us in a strong position to not only identify the right target but also execute a successful business combination within the anticipated time period. Management Team Our management team includes experienced professionals with leadership and operating business experience within the finance, private equity, investment banking, technology and media sectors. F. Jacob Cherian Chief Executive Officer & Director Mr. Jacob Cherian, our Chief Executive Officer and one of our directors, is the Co-CEO and a director of Anghami Inc. Mr. Cherian previously served as Chairman and CEO of VMAC. Mr. Cherian is a former CEO of three Nasdaq-listed special purpose acquisition companies, each of which has completed a business combination. Mr. Cherian brings deep capital markets, M&A, public/private equity, and management consulting expertise. He has experience in all facets of capital investing, including raising investment capital, sourcing and negotiating investments, building management teams, providing strategic guidance, and creating strategies to provide attractive returns. His prior work experience includes JP Morgan & Co. as an associate; KPMG LLP, as a director; and Computer Sciences Corp., as a partner. Mr. Cherian previously taught finance as an adjunct professor at St. John s University, Tobin College of Business MBA Program in New York for ten years. Mr. Cherian earned a B.A. in Accounting & Information Systems from Queens College of CUNY and an MBA in International Finance from St. John s University. Saurabh Gupta, CAIA Chief Financial Officer, Co-Founder & Director Mr. Saurabh Gupta, our Chief Financial Officer, Co-Founder and one of our directors, previously was the Co-Founder and a director of VMAC. Mr. Gupta has served as Managing Director of M! Capital Ventures, a Singapore-based specialty media investment firm which he founded in June 2015. Mr. Gupta is also the Managing Partner of The Asian Film Fund, which is a Mauritius-registered alternative investment fund. Between M! Capital Ventures and The Asian Film Fund, Mr. Gupta has led investments in more than 13 films across Productions and Distributions from Bollywood to Hollywood from 2016 to 2020. Mr. Gupta has over 21 years of experience across banking, investment management, M&A and strategy, having previously held senior roles in Singapore with Julius Baer, ANZ Bank, and ABN AMRO Bank N.V. 3 Table of Contents In May 2002, Mr. Gupta started his banking career in Singapore with Citibank as a Relationship Manager. Prior to joining Citibank, Mr. Gupta held an international sales and marketing position with Siemens AG in Munich, Germany from July 2000 to May 2002. In 2008, Mr. Gupta taught financial services marketing as an adjunct professor at Singapore Management University s School of Business. Mr. Gupta is a qualified Chartered Alternative Investment Analyst (CAIA). Mr. Gupta earned an MBA in Marketing from NMIMS, Mumbai, India, as well as a degree in Economics from the University of Delhi, India. Abhayanand Singh Co-Founder & Director Mr. Abhayanand Singh, our Co-Founder and one of our directors, is the Co-Founder & Group CEO of Vistas Media Capital Pte. Ltd., which is a media investment holding company, headquartered in Singapore with presence in several countries. Mr. Singh is a director of Anghami Inc. Mr. Singh was previously a Co-Founder and director of VMAC. Mr. Singh s career spans over 17 years across the banking, hedge fund and media industries. Mr. Singh has been successful in building the Vistas Media brand across the wider industry network through joint collaborations with seasoned media industry players and investments in intellectual properties such as the Critics Choice Film Awards and Critics Choice Short & Series Awards in India, which is a collaboration with the Film Critics Guild of India and Group M s Motion Content Group. Mr. Singh earned an MBA in Marketing from the Chetna Institute of Management and Research, Mumbai, India. Dhruv Saxena Chief Strategy Officer Mr. Saxena, our Chief Strategy Officer, is a seasoned management consultant with experience in media, technology and private equity across Asia, Europe, and the U.S., and specializes in value creation and performance improvement. Mr. Saxena previously was an associate of VMAC. Mr. Saxena was a consultant at Bain & Company ( Bain ). While at Bain, Mr. Saxena also maintained Bain s United States Media Point of View intellectual property, was a founding member of the TMT Centre in China, and worked extensively on over-the-top strategies for telco and cable companies. Mr. Saxena also drove due diligence across the media and technology sectors for Bain clients. Mr. Saxena earned a bachelor s in business administration from the University of Delhi, India, and is currently working towards earning his MBA from INSEAD with a focus on Finance and Decision Sciences (A.I.). Abhinav Somani Director Mr. Somani, one of our director nominees, is the Chief Operating Officer of Clearview AI. Mr. Somani previously was the Managing Director of artificial intelligence software products at MRI Software, LLC. Mr. Somani previously was one of the directors of VMAC. 4 Table of Contents Mr. Somani previously was an investment banking and private equity executive with Rothschild & Co. In July 2016, Mr. Somani founded Leverton Corporation, an artificial intelligence corporation, which was sold to MRI Software, LLC in 2019. Mr. Somani is an experienced investor in real estate, fintech and AI technology assets and brings a wealth of finance, real estate and technology relationships, along with substantial knowledge of the U.S. landscape. With over 14 years of work experience across multiple sectors, Mr. Somani has an extensive global network of private equity, banking, financing, and investor relationships that can be leveraged to grow any platform. Mr. Somani earned a B.S in Finance and Management from New York University s Stern School of Business. Dr. Klaas Baks, Ph.D. Director Dr. Baks, one of our director nominees, is a recognized thought leader in alternative investments and entrepreneurial finance, the Co-Founder and Director of the Emory Center for Alternative Investments and a Finance Professor at Emory University s Goizueta Business School since 2002. Dr. Baks is a director of Anghami Inc. and previously was a director of VMAC. Dr. Baks is the Atlanta Chair for TIGER 21, a leading North American peer-to-peer learning network for high-net-worth investors. Dr. Baks serves as a director or advisor for various companies and investment funds with over $1.5 billion in assets under management, including American Virtual Cloud Technologies (acquired by a special purpose acquisition company), Buckhead One Financial, JOYN, Peachtree Hotel Group and TWO Capital Partners. Dr. Baks research, teaching and publications focus on issues in alternative investments, entrepreneurial finance and investment management. He has also been recognized with nine awards, including Emory University s highest award for teaching excellence. Dr. Baks has a PhD in Finance from the University of Pennsylvania The Wharton School, an M.A. in Economics from Brown University and an M.Sc in Econometrics from the University of Groningen. David Knower Director Mr. Knower, one of our director nominees, has served as Chief Operating Officer and Managing Director of Cerberus Deutschland Beteiligungsberatung GmbH since 2003. Mr. Knower previously was the owner and managing director of Invenimus, an international consulting firm headquartered near Frankfurt, Germany. Mr. Knower spent 11 years, from 1986 to 1997, in various finance and controlling positions for Procter & Gamble in Germany, the rest of Europe and Asia-Pacific. Mr. Knower currently serves as the Vice President of the American Chamber of Commerce in Germany, a director of the Aspen Institute in Germany and a director of the American Institute of Contemporary German Studies in Washington. In 1983, Mr. Knower received two undergraduate degrees from the University of Massachusetts (Economics, German) with honors, and was named a Commonwealth Scholar. In 1985, Mr. Knower earned an MBA in Management, with honors, from the American Graduate School of International Management (Thunderbird). 5 Table of Contents Sergei Bespalov Director Sergei Bespalov, one of our director nominees, is a senior-level business executive with a wide international business network and over 29 years of experience in business and legal consulting through numerous board and advisory board positions for multinational businesses. Mr. Bespalov is the Founder and Co-Chairman of Aldamisa Entertainment, LLC, a film production company which has produced and released more than twenty films with total budgets close to $500 million. Mr. Bespalov is a seasoned entrepreneur focusing on investments in the media, gaming and real estate sectors. Mr. Bespalov has experience in the legal field as Of Counsel at the Law Offices of Marks & Sokolov LLC and Managing Partner at the Law Offices of Sergei Bespalov & Associates. Mr. Bespalov was previously an advisor to VMAC. Billy Naveed Advisor Mr. Naveed is a seasoned finance and investment professional with over 20 years of experience in investment banking advisory and trading, hedge fund sales, business strategy and the technology sector. From March 2019 to February 2021, Mr. Naveed served as Head of Strategy for Zilingo, a Singapore-based technology and commerce platform in the fashion industry in South East Asia. From September 2011 to March 2019, Mr. Naveed ran the Hedge Fund Sales desk at Credit Suisse (HK). Mr. Naveed was also the Head of Tech Sales from November 2015 to November 2017. Mr. Naveed previously held positions with Morgan Stanley (London & HK) from September 2002 to September 2011. Mr. Naveed is an alumnus of Milken Young Leaders, member of the Australian Corporate Directors Board and founder and CEO of Young Founders School, a charity that helps underprivileged high school kids learn about entrepreneurship. Mr. Naveed earned an M.Sc in Economics and Finance from Warwick University Warwick Business School and a B.Sc in Economics from Warwick University. Piiyush Singh Advisor Mr. Singh, our special advisor, is the co-founder of Vistas Media Capital, where he runs the MENA and India business for the venture. Mr. Singh was previously an advisor to VMAC. Mr. Singh oversees the development and production of feature films, short films, and web series in India for the film production and distribution entity Golden Ratio Films Pte. Ltd. Singapore. Mr. Singh also serves as the Co-Chairperson of the Singapore South Asian International Film Festival. Mr. Singh has over 13 years of experience in the media and entertainment industry, including significant production experience. Mr. Singh is a B.A. Honors Graduate in Economics, Anthropology and Philosophy from Canning College, Lucknow University, India. 6 Table of Contents Sunil John Advisor Mr. John, our special advisor, is the founder of ASDA A Burson Cohn & Wolfe ( BCW ), a leading public relations consultancy, and currently serves as President of BCW s MENA operations. Mr. John also serves as President MENA of two ASDA A BCW subsidiaries, Proof Integrated Communications, a full-service digital, branding, design, digital and social media company, and Penn Schoen Berland ( PSB ) Middle East, which offers research-based consultancy. Walid Mansour Advisor Mr. Mansour, our special advisor, has served as a Managing Partner of Middle East Venture Partners (MEVP) since 2010. Mr. Mansour has also served as a board member and advisor to many successful internet and technology companies regionally and globally such as Namshi, Anghami, Fresha and The Luxury Closet. Mr. Mansour is also the founder of WeBuild Ventures, a dedicated tech-venture studio focused on selected high impact technology companies. Prior to MEVP, Mr. Mansour worked in public policy as a strategy manager in the UAE Prime Ministry Office and a strategy consultant at Booz Allen Hamilton. Mr. Mansour holds a master s in industrial engineering from the Institut National des Science Appliqu s (INSA) de Lyon, France and an MBA from the Wharton School at the University of Pennsylvania. Dana Al Salem Advisor Ms. Salem is a global technology entrepreneur and keynote speaker on innovation and technology. Ms. Salem co-founded Clockwork in 1994, an award-winning agency that built the interactive online platforms. Ms. Salem co-founded Yahoo! Europe in 1996, built the Yahoo! Europe production team and implemented the rollout of 40 online services for the European local territories. Ms. Salem founded LostRecords, which produced global tours for musicians such as Chris Stills, Louis Bertignac and Youssou Ndour, in 2005. Ms. Salem founded FanFactory Ltd, a tech agency that focuses on predictive audience analytics, lead generation and consumer intelligence, in 2007. Ms. Salem serves as a special advisor to the governments of Panama, Monaco, Georgia, Serbia and Morocco, as well as a cyber security ambassador for the UK. Ms. Salem serves as an advisor to SPiCE VC, a venture capital fund that invests in the blockchain sector. Business Strategy & Business Combination Criteria Our management, directors and advisors consist of experienced professionals and entrepreneurs across the finance, private equity, investment banking, technology, media, capital market and operational sectors. They also have experience with initial public offerings and business combinations of SPACs. We have identified parameters 7 Table of Contents and criteria that we think are important and relevant in evaluating prospective target businesses. We will apply these parameters in evaluating prospects, even though we may ultimately decide to execute our initial business combination with a fundamentally strong company that may not exactly match our initial parameters and criteria. Focus: We will prioritize high growth entities that are embarking upon disruptive businesses within our target sectors and sub-sectors. Revenue and Earnings Growth Potential: We intend to seek companies with high growth trajectories within our target sectors that are driven by competitive advantages that can be accelerated through a partnership with us. We intend to acquire one or more businesses that have multiple and diverse potential drivers of revenue and earnings growth and also have the potential to generate strong and stable free cash flow. Management: We intend to seek companies with a proven and experienced existing management team that has the determination and ability to execute various strategic initiatives, with an emphasis on creating shareholder value, and to take advantage of the experience and expertise of our management team. Internal Controls: We intend to seek companies that have diligent compliance and reporting processes and strong financial controls indicative of a company prepared for the regulatory requirements of being a public entity. Benefit from Being Public: We intend to seek target companies that have the vision to take advantage of and appreciate the benefits of operating as a publicly traded entity, including broader access to capital, liquidity for employee compensation and potential acquisitions, and expanded branding in the marketplace. We will seek businesses that have, or can easily implement prior to the closing of a business combination, the governance, financial controls and investor relations systems key to successfully operating as a public company. Attractive Valuations: We consider ourselves to be rigorous, disciplined and valuation-centric investors, with a keen understanding of market value, upside and potential downside risks. We intend to seek companies with a decent market share and high growth potential in the segments in which they operate, but also available at a discount to valuation. Sourcing: We do not expect to participate in broadly marketed processes, but rather will aim to leverage our extensive network to source an attractive initial business combination. Notwithstanding the foregoing, we would consider participating in a process that is focused primarily on special purpose acquisition companies, where we would expect to compete on the strength of our prior experience in closing business combinations, understanding of the target s industry, and ability to add strategic value. The parameters mentioned above are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines, as well as other considerations, factors and criteria that our management team may deem relevant. In the event that we decide to enter into an initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy materials or tender offer documents, as applicable, that we would file with the SEC. In evaluating a prospective target business, we expect to conduct an extensive due diligence review which may encompass, as applicable and among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspections of facilities and a review of financial, operational, legal and other information about the target and its industry. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. 8 Table of Contents Competitive Advantage Experienced Management Team, Directors and Advisors Our management team, directors and advisors have substantial experience in finance, deal structuring, advisory, business building and scaling, as well as proprietary deal sourcing. We believe our professional backgrounds provide us with access to proprietary investment opportunities and position us to successfully navigate local business norms. In addition, members of our management team have significant prior experience in consummating merger and acquisition transactions, including initial business combinations for special purpose acquisition companies. Our Operating Track Record Our team has strong business operating experience and has demonstrated an ability to launch, operate and scale businesses in various industries (namely technology and media), as well as lead companies to successful exits, creating significant value for stakeholders. We believe the collective experience of our team uniquely positions us to identify attractive targets for a potential business combination and help such targets achieve long-term objectives. Past Blank Check Experience In August 2020, Vistas Media Acquisition Company Inc. (Nasdaq: VMAC) consummated its initial public offering, generating gross proceeds of $100,000,000, and its securities began trading on Nasdaq. Vistas Media Capital Pte. Ltd. is the parent of VMAC s sponsor, Vistas Media Sponsor LLC. In March 2021, VMAC entered into a definitive business combination agreement with Anghami Inc. ( Anghami ), the leading music streaming platform in the Middle East and North Africa. Upon consummation of the transaction on February 4, 2022, Anghami became the first Arab technology company to be listed on Nasdaq. We will continue to leverage the deep relationships and long-standing experience that our management team, strategic advisors and directors command in the global media, technology, entertainment, finance, global private equity, asset management, investment banking and consulting industries. We believe that this combination of relationships and experience will put us in an excellent position to not only identify the right target but also execute a successful business combination within the anticipated time period. VMAC s former management team, as well as some of its directors, will serve in management and director roles of Vistas Acquisition Company II Inc. Our Deep Sourcing Global Network Our team has a long track record as entrepreneurs, operators and investors, through which they developed a deep understanding of the entrepreneurial journey. Our team is regarded as thought leaders and mentors with a history of helping other founders and businesses develop and scale their businesses. We believe that we will be able to source potential targets through our sponsor s, management team s, directors and strategic advisors contacts within their combined global network of private equity, asset management, venture capital, investment banking, consulting firms, and investors in the technology and media sectors. Upon completion of this offering, our management team and sponsor will communicate with their global networks on our acquisition criteria and immediately begin screening suitable opportunities. INITIAL BUSINESS COMBINATION Nasdaq rules require that we must complete one or more initial business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm which is a member of FINRA or a valuation or appraisal firm with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of the target s assets or prospects. 9 Table of Contents We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test described above. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the Securities and Exchange Commission (the SEC ) to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended (the Exchange Act ). As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. Past performance of our management team does not guarantee (i) that we will be able to find an appropriate and suitable company for our initial business combination or (ii) success with respect to the business combination we may consummate. You should not rely on historical record of our management team as indicative of our future performance. For more information on the experience and background of our management team, see the section entitled Management. SOURCING OF POTENTIAL INITIAL BUSINESS COMBINATION TARGETS We believe our management team s significant operating and transaction experience and relationships will provide us with a substantial number of potential initial business combination targets. Over the course of their careers, the members of our management team have developed a broad network of contacts and corporate relationships around the world, which includes private equity firms, venture capitalists and entrepreneurs. This global network has grown through the activities of our management team sourcing, acquiring and financing businesses, the reputation of our management team for integrity and fair dealing with sellers, financing sources and target management teams and the experience of our management team in executing transactions under varying economic and financial market conditions. In addition, members of our management team and board of directors have developed contacts from serving on the boards of directors of public companies. We believe this global network has provided our management team with a flow of referrals that has resulted in many transactions which were proprietary or where a limited group of investors were invited to participate in the sale process. We believe that the network of contacts and relationships of our management team will provide us important sources of investment opportunities. In addition, we anticipate that target business combination candidates will be brought to our attention from various unaffiliated sources, including investment market participants, private equity funds and large business enterprises seeking to divest non-core assets or divisions. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, executive officers or directors, or completing the business combination through a joint venture or other form of shared ownership with our sponsor, executive officers or directors. In the event we seek to complete an initial business combination with a target that is affiliated with our sponsor, executive officers or directors, we, or a committee of independent directors, would obtain an opinion from an independent investment banking firm which is a member of FINRA or a valuation or appraisal firm stating that such an initial business combination is fair to our company from a financial point of view. 10 Table of Contents Members of our management team and our independent directors will directly or indirectly own founder shares, ordinary shares and/or private placement units following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to another entity pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such other entity, subject to their fiduciary duties under Cayman Islands law. Our amended and restated memorandum and articles of association will provide that to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and us, on the other. We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our initial business combination. In addition, our sponsor and our officers and directors may sponsor or form other special purpose acquisition companies similar to ours or may pursue other business or investment ventures during the period in which we are seeking an initial business combination. Any such companies, businesses or investments may present additional conflicts of interest in pursuing an initial business combination. However, we do not believe that any such potential conflicts would materially affect our ability to complete our initial business combination. CORPORATE INFORMATION Our executive offices are located at 30 Wall Street, 8th Floor, New York, New York 10005, and our telephone number is (212) 859-3525. The information contained on or accessible through our corporate website (if any) or any other website that we may maintain is not a part of this prospectus or the registration statement of which this prospectus is a part. We are a Cayman Islands exempted company. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. 11 Table of Contents In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that is held by non-affiliates equals or exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates exceeds $250 million as of the prior June 30th, and (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates exceeds $700 million as of the prior June 30th. 12 Table of Contents THE OFFERING In making your decision on whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors in this prospectus. Securities offered 20,000,000 units, at $10.00 per unit, each unit consisting of: one Class A ordinary share; and one-half of one redeemable warrant. Proposed Nasdaq symbols Units: VACXU Class A ordinary shares: VACX Warrants: VACXW Trading commencement and separation of Class A ordinary shares and warrants The units are expected to begin trading on or promptly after the date of this prospectus. The Class A ordinary shares and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless the underwriters inform us of their decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the Class A ordinary shares and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into Class A ordinary shares and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Separate trading of the Class A ordinary shares and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A ordinary shares and warrants be traded separately until we have filed with the SEC a Current Report on Form 8-K which includes an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which closing is anticipated to take place three business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. 13 Table of Contents Units: Number outstanding before this offering: 0 Number of private placement units to be sold in the private placement simultaneously with this offering 486,500(1) Number of units to be outstanding after this offering and the private placement 20,486,500(1) Ordinary shares: Number outstanding before this offering 5,750,000(2)(3) Number of ordinary shares included in the private placement units 486,500 Number outstanding after this offering 25,486,500(1)(3)(4) Warrants: Number outstanding before this offering 0 Number of private warrants included in the private placement units 243,250(1) Number of warrants to be outstanding after this offering 10,243,250(1)(5) Exercisability Each whole warrant offered in this offering is exercisable to purchase one Class A ordinary share. Only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We structured each unit to contain one-half of one warrant, with each whole warrant exercisable for one Class A ordinary share, as compared to units issued by some other similar SPACs which contain whole warrants exercisable for one whole share, in order to reduce the dilutive effect of the warrants upon completion of a business combination as compared to units that each contain a whole warrant to purchase one whole share, thus making us, we believe, a more attractive business combination partner for target businesses. ____________ (1) Assumes no exercise of the underwriters over-allotment option, the forfeiture of 750,000 founder shares by our initial shareholders for no consideration and the issuance and sale of the 486,500 private placement units. (2) Includes up to 750,000 founder shares that will be forfeited by our initial shareholders depending on the extent to which the underwriters over-allotment option is exercised. (3) Founder shares are currently classified as Class B ordinary shares, which shares will automatically convert into Class A ordinary shares concurrently with or immediately following the consummation of our initial business combination on a one-for-one basis, subject to adjustment as described below adjacent to the caption Founder shares conversion and anti-dilution rights. (4) Includes 20,000,000 public shares, 5,000,000 founder shares and 486,500 private shares. (5) Includes 10,000,000 public warrants and 243,250 private warrants underlying private placement units. 14 Table of Contents Exercise price $11.50 per share, subject to adjustments as described herein. In addition, if (x) we issue additional Class A ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per Class A ordinary share (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our initial shareholders or their affiliates, without taking into account any founder shares held by our initial shareholders or such affiliates, as applicable, prior to such issuance), (the Newly Issued Price ) (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our Class A ordinary shares during the 20 trading day period starting on the trading day after the day on which we consummate our initial business combination (such price, the Market Value ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, the $18.00 per share redemption trigger price described adjacent to Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00 will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price, and the $10.00 per share redemption trigger price described adjacent to the caption Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00 will be adjusted (to the nearest cent) to be equal to the higher of the Market Value and the Newly Issued Price. Exercise period The warrants will become exercisable on the later of: 30 days after the completion of our initial business combination, and 12 months from the closing of this offering, provided, in each case, that we have an effective registration statement under the Securities Act covering the Class A ordinary shares issuable upon exercise of the warrants and a current prospectus relating to them is available and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. We are not registering the Class A ordinary shares issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable, but in no event later than 15 business days after the closing of our initial business combination, we will use our best efforts to file with the SEC and have an effective registration statement covering the Class A ordinary shares issuable upon exercise of the warrants and to maintain a current prospectus relating to those Class A ordinary shares until the warrants expire or are redeemed, as specified in the warrant agreement. If a registration statement covering the Class A ordinary shares issuable upon exercise of the warrants is not effective by the 15 Table of Contents 60th business day after the closing of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption. Notwithstanding the above, if our Class A ordinary shares are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, and in the event we do not so elect, we will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00 Once the warrants become exercisable, we may redeem the outstanding warrants for cash: in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period ; and if, and only if, the last reported sale price (the closing price ) of our Class A ordinary shares equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading Description of Securities Warrants Public Shareholders Warrants Anti-Dilution Adjustments ) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. We will not redeem the warrants as described above unless an effective registration statement under the Securities Act covering the Class A ordinary shares issuable upon exercise of the warrants is effective and a current prospectus relating to those Class A ordinary shares is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. 16 Table of Contents Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00 Once the warrants become exercisable, we may redeem the outstanding warrants: in whole and not in part; at a price of $0.10 per warrant upon a minimum of 30 days prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to the table set forth under Description of Securities Warrants Public Shareholders Warrants based on the redemption date and the fair market value of our Class A ordinary shares (as defined below) except as otherwise described in Description of Securities Warrants Public Shareholders Warrants if, and only if, the closing price of our Class A ordinary shares equals or exceeds $10.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading Description of Securities Warrants Public Shareholders Warrants Anti-dilution Adjustments ) for any 20 trading days within the 30-trading day period ending three trading days before we send the notice of redemption to the warrant holders; and if the closing price of our Class A ordinary shares for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders is less than $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading Warrants Public Shareholders Warrants Anti-Dilution Adjustments ), the private warrants underlying the private placement units must also be concurrently called for redemption on the same terms as the outstanding public warrants, as described above. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. As a result, we may redeem the warrants as set forth above even if the holders are otherwise unable to exercise the warrants. The fair market value of our Class A ordinary shares shall mean the volume-weighted average price of our Class A ordinary shares during the 10 trading days ending on the third trading day immediately following the date on which the notice of redemption is sent to the holders of warrants. We will provide our warrant holders with the final fair market value no later than one business day after the 10 trading day period described above ends. In no event will the warrants be exercisable in connection with this redemption feature for more than 0.361 Class A ordinary shares per warrant (subject to adjustment). 17 Table of Contents No fractional Class A ordinary shares will be issued upon redemption. If, upon redemption, a holder would be entitled to receive a fractional interest in a share, we will round down to the nearest whole number of the number of Class A ordinary shares to be issued to the holder. Please see the section entitled Description of Securities Warrants Public Shareholders Warrants for additional information. Ability to extend time to complete business combination If we anticipate that we may not be able to consummate our initial business combination within 15 months, we may, by resolution of our board if requested by our sponsor, extend the period of time to consummate a business combination up to two times, each by an additional three months (for a total of up to 21 months to complete a business combination). Pursuant to the terms of our amended and restated memorandum and articles of association and the trust agreement entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order to extend the time available for us to consummate our initial business combination, our sponsor or its affiliates or designees, upon five days advance notice prior to the date of the applicable deadline, must deposit into the trust account $2,000,000, or up to $2,300,000 depending on the extent to which the underwriters over-allotment option is exercised ($0.10 per share in any case), on or prior to the date of the applicable deadline, for each three-month extension, or up to an aggregate of $4,000,000 (or up to $4,600,000 depending on the extent to which the underwriters over-allotment option is exercised), or $0.20 per share for a full six-month extension. Any such payments would be made in the form of a non-interest-bearing loan. The terms of the promissory note to be issued in connection with any such loans have not yet been negotiated. If we complete our initial business combination, we would repay such loaned amounts out of the proceeds of the trust account released to us. If we do not complete a business combination, we will not repay such loans. Furthermore, the letter agreement with our initial shareholders contains a provision pursuant to which our sponsor has agreed to waive its right to be repaid for such loans in the event that we do not complete a business combination. In the event that we receive notice from our sponsor five days prior to the deadline of its intent to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the deadline. In addition, we intend to issue a press release the day after the deadline announcing whether or not the funds had been timely deposited. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. 18 Table of Contents Founder shares On April 20, 2021, our sponsor purchased an aggregate of 6,325,000 founder shares in exchange for a capital contribution of $25,000, or approximately $0.004 per share. Prior to the initial investment in the company of $25,000 by the sponsor, the company had no assets, tangible or intangible. The per share price of the founder shares was determined by dividing the amount of cash contributed to the company by the number of founder shares issued. On May 27, 2022, our sponsor surrendered 575,000 founder shares to us for cancellation for no consideration, resulting in 5,750,000 founder shares outstanding. In consideration of certain advisory services provided to our sponsor, our sponsor has agreed to sell 500,000 Class B ordinary shares to Meteora at a price of $0.01 per share concurrently with the closing of this offering. The number of founder shares outstanding was determined based on the expectation that the total size of this offering would be a maximum of 23,000,000 units if the underwriters over-allotment option is exercised in full, and therefore that such founder shares would represent 20% of the outstanding shares after this offering (without giving effect to the private placements). Up to 750,000 of the founder shares will be forfeited by our sponsor depending on the extent to which the underwriters over-allotment option is not exercised. If we increase or decrease the size of the offering pursuant to Rule 462(b) under the Securities Act, we will effect a share dividend or share contribution back to capital or other appropriate mechanism, as applicable, with respect to our Class B ordinary shares immediately prior to the consummation of the offering in such amount as to maintain the ownership of founder shares by our initial shareholders, on an as-converted basis, at 20% of our issued and outstanding ordinary shares upon the consummation of this offering (without giving effect to the private placements). Any conversion of Class B ordinary shares described herein will take effect as a redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. The founder shares are identical to the Class A ordinary shares included in the units being sold in this offering, except that: only holders of Class B ordinary shares will have the right to vote on the appointment of directors prior to the completion of our initial business combination; the founder shares are subject to certain transfer restrictions, as described in more detail below the founder shares are entitled to registration rights; our initial shareholders, sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to (i) waive their redemption rights with respect to any founder shares and public shares they hold in connection with the completion of our initial business combination, (ii) waive their redemption rights with respect to any founder shares and public shares they hold in connection with a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we have not consummated an initial business combination within 15 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time, as described in more detail in this prospectus) or with respect to any 19 Table of Contents other material provisions relating to shareholders rights or pre-initial business combination activity and (iii) waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to complete our initial business combination within 15 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time, as described in more detail in this prospectus) (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). If we submit our initial business combination to our public shareholders for a vote, we will complete our initial business combination only if we obtain approval by way of an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the company. As a result, in addition to our initial shareholders founder shares and private shares, we would need only 7,256,751, or 36.3%, of our public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming all issued and outstanding shares are voted, the over-allotment option is not exercised and that the initial shareholders do not purchase any units in this offering or units or shares in the after-market); and the founder shares are automatically convertible into our Class A ordinary shares concurrently with or immediately following the consummation of our initial business combination on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described below adjacent to the caption Founder shares conversion and anti-dilution rights. Transfer restrictions on founder shares Our initial shareholders have agreed not to transfer, assign or sell any of their founder shares until the earlier to occur of: (i) one year after the completion of our initial business combination and (ii) the date on which we complete a liquidation, merger, capital share exchange or other similar transaction after our initial business combination that results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property; except to certain permitted transferees and under certain circumstances as described herein under Principal Shareholders Transfers of Founder Shares and Private Placement Securities. Any permitted transferees will be subject to the same restrictions and other agreements of our initial shareholders with respect to any founder shares. We refer to such transfer restrictions throughout this prospectus as the lock-up. Notwithstanding the foregoing, the founder shares will be released from the lock-up if (1) the closing price of our Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination or (2) if we consummate a transaction after our initial business combination which results in our shareholders having the right to exchange their shares for cash, securities or other property. In the case of the private placement units, including the underlying private shares and private warrants, the private placement units shall not be salable or transferable until 30 days after the completion of our initial business combination pursuant to a letter agreement between us and the initial shareholders. 20 Table of Contents Founder shares conversion and anti-dilution rights The founder shares will automatically convert into Class A ordinary shares concurrently with or immediately following the consummation of our initial business combination on a one-for-one basis, subject to adjustment for share subdivisions, share capitalizations, share dividends, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein. In the case that additional Class A ordinary shares or equity-linked securities are issued or deemed issued in connection with our initial business combination, the number of Class A ordinary shares issuable upon conversion of all founder shares will equal, in the aggregate, on an as-converted basis, 20% of the total number of Class A ordinary shares outstanding after such conversion (after giving effect to any redemptions of Class A ordinary shares by public shareholders), including the total number of Class A ordinary shares issued, or deemed issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of the initial business combination, excluding any Class A ordinary shares or equity-linked securities or rights exercisable for or convertible into Class A ordinary shares issued, or to be issued, to any seller in the initial business combination and any private placement units issued to our sponsor, officers or directors upon conversion of working capital loans; provided that such conversion of founder shares will never occur on a less than one-for-one basis. Right of First Refusal We have agreed to grant Meteora a right of first refusal to purchase up to 9.9% of the units sold in this offering and up to 10% of any securities that we may decide to issue in a private placement that would close concurrently with the closing of our initial business combination. Meteora has the right, but is under no obligation, to purchase these securities. These securities, if issued, will be identical to the Class A ordinary shares and warrants, respectively, included in the units being sold in this offering, except that such securities will be subject to transfer restrictions and registration rights. Please see Description of Securities Registration Rights for additional information. If we decide to issue any securities in connection with the closing of our initial business combination, the proceeds from the sale of such securities may be used as part of the consideration to the sellers in our initial business combination, for expenses in connection with our initial business combination or for working capital in the post-business combination company. These securities will be issued only in connection with the closing of the initial business combination. In the event that Meteora purchases 9.9% of the units sold in this offering and votes the Class A ordinary shares included in such units and the 500,000 founder shares to be purchased from the Sponsor in favor of our initial business combination, in addition to our initial shareholders founder shares and private shares, only 5,726,751 of the public shares sold in this offering and not purchased by Meteora, or 26.4% of the 20,000,000 public shares sold in this offering, would be required to approve our initial business combination, assuming all outstanding shares are voted. Meteora will have the same rights to the funds held in the trust account with respect to the Class A ordinary shares underlying the units they may purchase in this offering as the rights afforded to our public shareholders. 21 Table of Contents Appointment of Directors; Voting Rights Holders of record of our Class A ordinary shares and Class B ordinary shares are entitled to one vote for each share held on all matters to be voted on by shareholders. Unless specified in our amended and restated memorandum and articles of association or as required by the Companies Act or stock exchange rules, an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the company, is generally required to approve any matter voted on by our shareholders. Approval of certain actions require a special resolution under Cayman Islands law, which requires the affirmative vote of a majority of at least two-thirds of the shareholders who attend and vote at a general meeting of the company, and pursuant to our amended and restated memorandum and articles of association, such actions include, among other things, amending our amended and restated memorandum and articles of association and approving a statutory merger or consolidation with another company. There is no cumulative voting with respect to the appointment of directors, meaning, following our initial business combination, the holders of more than 50% of our ordinary shares voted for the appointment of directors will be able to appoint all of the directors. Only holders of Class B ordinary shares will have the right to vote on the appointment of directors prior to the completion of our initial business combination. Holders of our public shares will not be entitled to vote on the appointment of directors during such time. These provisions of our amended and restated memorandum and articles of association relating to the rights of holders of Class B ordinary shares to appoint directors may be amended if approved by holders of at least 90% of our ordinary shares voting in a general meeting. With respect to any other matter submitted to a vote of our shareholders, including any vote in connection with our initial business combination, except as required by law, holders of the founder shares and holders of our public shares will vote together as a single class, with each share entitling the holder to one vote. If we seek shareholder approval of our initial business combination, we will complete our initial business combination only if we obtain approval by way of an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the company. In such case, our sponsor, officers and directors have agreed to vote their founder shares, their private shares and any public shares purchased during or after this offering (including in open-market and privately negotiated transactions) in favor of our initial business combination. As a result, in addition to our initial shareholders founder shares and private shares, we would need only 7,256,751, or 36.3%, of our public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming all issued and outstanding shares are voted, the over-allotment option is not exercised and that the initial shareholders do not purchase any units in this offering or units or shares in the after-market). 22 Table of Contents Private placement units Our sponsor has agreed that it will purchase an aggregate of 486,500 private placement units (or 516,500 private placement units if the over-allotment option is exercised in full) at a price of $10.00 per unit, for an aggregate purchase price of $4,865,000, or $5,165,000 if the over-allotment option is exercised in full. A portion of the purchase price of the private placement units will be added to the proceeds from this offering to be held in the trust account such that at the time of closing of this offering $200 million (or $230 million if the underwriters exercise their over-allotment option in full) will be held in the trust account. The private placement units will be identical to the units sold in this offering except as described below. The private shares are subject to certain transfer restrictions, as described in more detail below: our initial shareholders shall enter into a letter agreement with us, pursuant to which they have agreed to (i) waive their redemption rights with respect to their private shares in connection with the completion of our initial business combination, (ii) waive their redemption rights with respect to their private shares in connection with a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain amendments to our charter prior thereto or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time) or (B) with respect to any other provision relating to shareholders rights or pre-initial business combination activity and (iii) waive their rights to liquidating distributions from the trust account with respect to their private shares if we fail to complete our initial business combination within 15 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time), although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame. 23 Table of Contents pursuant to the letter agreement, our initial shareholders, officers and directors have agreed to vote their founder shares and private shares in favor of our initial business combination. If we submit our initial business combination to our public shareholders for a vote, we will complete our initial business combination only if a majority of the then outstanding ordinary shares present and entitled to vote at the meeting to approve the initial business combination are voted in favor of the initial business combination. As a result, in addition to our initial shareholders founder shares and private shares, we would need only 7,256,751, or 36.3%, of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming all issued and outstanding shares are voted, the over-allotment option is not exercised and that the initial shareholders do not purchase any units in this offering or units or shares in the after-market). The private warrants, so long as they are held by our sponsor or its permitted transferees, (i) will not be redeemable by us (except as set forth under Description of Securities Warrants Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00 ), (ii) may not (including the Class A ordinary shares issuable upon exercise of these warrants), subject to certain limited exceptions, be transferred, assigned or sold by the holders until 30 days after the completion of our initial business combination, (iii) may be exercised by the holders on a cashless basis and (iv) will be entitled to registration rights. If the private warrants are held by holders other than our initial shareholders or their permitted transferees, the private warrants will be redeemable by us and exercisable by the holders on the same basis as the public warrants. If we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time, as described in more detail in this prospectus), the proceeds from the sale of the private placement units held in the trust account will be used to fund the redemption of our public shares (subject to the requirements of applicable law) and the private placement units (and the underlying securities) will expire worthless. 24 Table of Contents Transfer restrictions on private placement units and underlying securities The private placement units (including the underlying private warrants and private shares) will not be transferable, assignable or salable until 30 days after the completion of our initial business combination (except as described under the section of this prospectus entitled Principal Shareholders Transfers of Founder Shares and Private Placement Securities ). Following such period, the private placement units (including the private warrants and private shares) will be transferable, assignable or salable, except that these securities will not trade. Proceeds to be held in trust account The rules of Nasdaq provide that at least 90% of the gross proceeds from this offering and the private placements be deposited in a trust account. Of the proceeds we will receive from this offering and the private placements described in this prospectus, $200 million, or $230 million if the underwriters over-allotment option is exercised in full ($10.00 per unit in either case), will be deposited into a segregated trust account located in the United States at UBS Financial Services Inc. with Continental Stock Transfer & Trust Company acting as trustee, after deducting $2,000,000 in underwriting discounts and commissions payable upon the closing of this offering (or $2,300,000 if the underwriters over-allotment option is exercised in full) and an aggregate of $850,000 to pay fees and expenses in connection with the closing of this offering and for working capital following the closing of this offering. The proceeds to be placed in the trust account include $6,000,000 (or up to $6,900,000 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, the proceeds from this offering and the private placements will not be released from the trust account until the earliest of (i) the completion of our initial business combination, (ii) the redemption of our public shares if we are unable to complete our initial business combination within 15 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time, as described in more detail in this prospectus), subject to applicable law, and (iii) the redemption of our public shares properly submitted in connection with a shareholder vote to amend our amended and restated memorandum and articles of association to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we have not consummated an initial business combination within 15 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time, as described in more detail in this prospectus) or with respect to any other material provisions relating to shareholders rights or pre-initial business combination activity. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. 25 Table of Contents Anticipated expenses and funding sources Unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use, except the withdrawal of interest to pay our taxes and/or to redeem our public shares in connection with an amendment to our amended and restated memorandum and articles of association, as described above. The proceeds held in the trust account will be invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. We estimate the interest earned on the trust account will be approximately $200,000 per year, assuming an interest rate of 0.1% per year; however, we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from such interest withdrawn from the trust account and: the net proceeds of this offering and the sale of the private placement units not held in the trust account, which initially will be approximately $2,015,000 in working capital after the payment of approximately $850,000 in expenses relating to this offering; and any loans or additional investments from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation to advance funds or invest in us; provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of our initial business combination. Up to $1,500,000 of such loans may be convertible into private placement-equivalent units, at a price of $10.00 per unit, at the option of the lender. Conditions to completing our initial business combination Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm which is a member of FINRA or a valuation or appraisal firm. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of the target s assets or prospects. We will complete our initial business combination only if the post-transaction company in which our public shareholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or is otherwise not required to register as an investment company under the Investment Company Act. Even if the 26 Table of Contents post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post business combination company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test described above; provided that, in the event that the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as our initial business combination for purposes of a seeking shareholder approval or conducting a tender offer, as applicable. Permitted purchases of public shares and public warrants by our affiliates If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, initial shareholders, directors, executive officers, advisors or their affiliates may purchase shares or public warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. There is no limit on the number of shares our initial shareholders, directors, officers, advisors or their affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds held in the trust account will be used to purchase shares or public warrants in such transactions. If they engage in such transactions, they will be restricted from making any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. We expect any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. However, in the event we conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, if our sponsor, initial shareholders, directors, executive officers, advisors or their affiliates were to purchase shares or warrants from public shareholders, such 27 Table of Contents purchases would by structured in compliance with the requirements of Rule 14e-5 under the Exchange Act including, in pertinent part, through adherence to the following: the Company s registration statement/proxy statement filed for its business combination transaction would disclose the possibility that the Company s sponsor, initial shareholders, directors, officers, advisors or their affiliates may purchase shares or warrants from public shareholders outside the redemption process, along with the purpose of such purchases; if the Company s sponsor, initial shareholders, directors, officers, advisors or their affiliates were to purchase shares or warrants from public shareholders, they would do so at a price no higher than the price offered through the Company s redemption process; the Company s registration statement/proxy statement filed for its business combination transaction would include a representation that any of the Company s securities purchased by the Company s sponsor, initial shareholders, directors, officers, advisors or their affiliates would not be voted in favor of approving the business combination transaction; the Company s sponsor, initial shareholders, directors, officers, advisors or their affiliates would not possess any redemption rights with respect to the Company s securities or, if they do acquire and possess redemption rights, they would waive such rights; and the Company would disclose in its Form 8-K, before to the Company s security holder meeting to approve the business combination transaction, the following material items: the amount of the Company s securities purchased outside of the redemption offer by the Company s sponsor, initial shareholders, directors, officers, advisors or their affiliates, along with the purchase price; the purpose of the purchases by the Company s sponsor, initial shareholders, directors, officers, advisors or their affiliates; the impact, if any, of the purchases by the Company s sponsor, initial shareholders, directors, officers, advisors or their affiliates on the likelihood that the business combination transaction will be approved; the identities of Company security holders who sold to the Company s sponsor, initial shareholders, directors, officers, advisors or their affiliates (if not purchased on the open market) or the nature of Company security holders (e.g., 5% security holders) who sold to the Company s sponsor, initial shareholders, directors, officers, advisors or their affiliates; and the number of Company securities for which the Company has received redemption requests pursuant to its redemption offer. 28 Table of Contents See Proposed Business Permitted purchases of our securities for a description of how our sponsor, initial shareholders, directors, executive officers, advisors or any of their affiliates will select which shareholders to purchase securities from in any private transaction. The purpose of any such purchases of shares could be to vote such shares in favor of the business combination and thereby increase the likelihood of obtaining shareholder approval of the business combination or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrantholders for approval in connection with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our Class A ordinary shares or warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Redemption rights for public shareholders upon completion of our initial business combination We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations and on the conditions described herein. The amount in the trust account is initially anticipated to be $10.00 per public share. The per share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the representative of the underwriters. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our initial shareholders, sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares they hold and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination. Manner of conducting redemptions We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a general meeting called to approve the business combination or (ii) without a shareholder vote by means of a tender offer. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under applicable law or stock exchange listing requirement. Asset acquisitions and share purchases would not typically require shareholder approval while direct mergers with 29 Table of Contents our company where we do not survive and any transactions where we issue more than 20% of our outstanding Class A ordinary shares or seek to amend our amended and restated memorandum and articles of association would require shareholder approval. So long as we obtain and maintain a listing for our securities on Nasdaq, we will be required to comply with Nasdaq s shareholder approval rules. The requirement that we provide our public shareholders with the opportunity to redeem their public shares by one of the two methods listed above will be contained in provisions of our second amended and restated memorandum and articles of association and will apply whether or not we maintain our registration under the Exchange Act or our listing on Nasdaq. Such provisions may be amended if approved by holders of 65% of our ordinary shares entitled to vote thereon. If we provide our public shareholders with the opportunity to redeem their public shares in connection with a general meeting, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A under the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and file proxy materials with the SEC. If we seek shareholder approval, we will complete our initial business combination only if we obtain approval by way of an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the company. A quorum for such meeting will be present if the holders of a majority of issued and outstanding shares entitled to vote at the meeting are represented in person or by proxy. Our initial shareholders will count toward this quorum and, pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote their founder shares, their private shares and any public shares purchased during or after this offering (including in open-market and privately negotiated transactions) in favor of our initial business combination. For purposes of seeking approval pursuant to an ordinary resolution, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. As a result, in addition to our initial shareholders founder shares and private shares, we would need only 7,256,751, or 36.3%, of our public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming all issued and outstanding shares are voted, the over-allotment option is not exercised and that the initial shareholders do not purchase any units in this offering or units or shares in the after-market). These quorum and voting thresholds, and the voting agreements of our initial shareholders, may make it more likely that we will consummate our initial business combination. Each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction, whether they participate in or abstain from voting or whether they were a public shareholder on the record date for the general meeting held to approve the proposed transaction. 30 Table of Contents If a shareholder vote is not required and we do not decide to hold a shareholder vote for business or other legal reasons, we will: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E under the Exchange Act, which regulate issuer tender offers, and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about our initial business combination and the redemption rights as is required under Regulation 14A under the Exchange Act, which regulates the solicitation of proxies. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering more than the number of public shares we are permitted to redeem. If public shareholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete such initial business combination. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase our Class A ordinary shares in the open market, in order to comply with Rule 14e-5 under the Exchange Act. We intend to require our public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to, at the holder s option, either deliver their share certificates to our transfer agent or deliver their shares to our transfer agent electronically using The Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) system, prior to the date set forth in the proxy materials or tender offer documents, as applicable. In the case of proxy materials, this date may be up to two business days prior to the vote on the proposal to approve the initial business combination. In addition, if we conduct redemptions in connection with a shareholder vote, we intend to require a public shareholder seeking redemption of its public shares to also submit a written request for redemption to our transfer agent two business days prior to the vote in which the name of the beneficial owner of such shares is included. The proxy materials or tender offer documents, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public shareholders to satisfy such delivery requirements. We believe that this will allow our transfer agent to efficiently process any redemptions without the need for further communication or action from the redeeming public shareholders, which could delay redemptions and result in additional administrative cost. If the proposed initial business combination is not approved and we continue to search for a target company, we will promptly return any certificates or shares delivered by public shareholders who elected to redeem their shares. 31 Table of Contents Our amended and restated memorandum and articles of association will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001. In addition, our proposed initial business combination may impose a minimum cash requirement for: (i) cash consideration to be paid to the target or its owners, (ii) cash for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions. In the event the aggregate cash consideration we would be required to pay for all Class A ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will not complete the initial business combination or redeem any shares in connection with such initial business combination, and all Class A ordinary shares submitted for redemption will be returned to the holders thereof. We may, however, raise funds through the issuance of equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements or backstop arrangements we may enter into following consummation of this offering, in order to, among other reasons, satisfy such net tangible assets or minimum cash requirements. Limitation on redemption rights of shareholders holding 15% or more of the shares sold in this offering if we hold shareholder vote Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. We believe the restriction described above will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us, our sponsor or our management at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. 32 Table of Contents Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be used to pay amounts due to any public shareholders who exercise their redemption rights as described above under Redemption rights for public shareholders upon completion of our initial business combination, to pay the representative of the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our amended and restated memorandum and articles of association will provide that we will have only 15 months from the closing of this offering to complete our initial business combination (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time, as described in more detail in this prospectus). If we are unable to complete our initial business combination within such 15-month period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (which interest shall be net of taxes payable and up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject, in each case, to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within the 15-month (or up to 21-month) time period. Our initial shareholders have entered into agreements with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within 15 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time, as described in more detail in this prospectus). However, if our initial shareholders or management team acquire public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted 15-month (or up to 21-month) time frame. 33 Table of Contents The underwriters have agreed to waive their rights to their deferred underwriting commission held in the trust account in the event we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time, as described in more detail in this prospectus) and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. Our sponsor, executive officers, directors and director nominees have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time, as described in more detail in this prospectus) from the closing of this offering or with respect to any other material provisions relating to shareholders rights or pre-initial business combination activity, unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (which interest shall be net of taxes payable), divided by the number of then outstanding public shares, subject to the limitations described above under Limitations on redemptions. For example, our board of directors may propose such an amendment if it determines that additional time is necessary to complete our initial business combination. In such event, we will conduct a proxy solicitation and distribute proxy materials pursuant to Regulation 14A under the Exchange Act seeking shareholder approval of such proposal, and in connection therewith, provide our public shareholders with the redemption rights described above upon shareholder approval of such amendment. Limited payments to insiders There will be no finder s fees, reimbursement, consulting fee, monies in respect of any payment of a loan or other compensation paid by us to our sponsor, officers or directors, or any affiliate of our sponsor or officers prior to, or in connection with any services rendered in order to effectuate, the consummation of our initial business combination (regardless of the type of transaction that it is). However, the following payments will be made to our sponsor, officers or directors, or our or their affiliates, and, if made prior to our initial business combination will be made from funds held outside the trust account. Repayment of up to an aggregate of $500,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; Payment to our sponsor of $10,000 per month for office space, secretarial and administrative services provided to members of our management team; Payment of customary fees we may elect to make to members of our board of directors for director service; Reimbursement for any out-of-pocket expenses related to identifying, investigating, negotiating and completing an initial business combination; and 34 Table of Contents Repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination. Up to $1,500,000 of such working capital loans may be convertible into private placement-equivalent units at a price of $10.00 per unit at the option of the lender. Such units would be identical to the private placement units, including as to exercise price, exercisability and exercise period. The terms of such working capital loans by our sponsor or its affiliates, or our officers and directors, if any, have not been determined and no written agreements exist with respect to such loans. Audit Committee Prior to the effectiveness of this registration statement, we will establish and maintain an audit committee. Among its responsibilities, the audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliates and monitor compliance with the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to promptly take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled Management Committees of the Board of Directors Audit Committee. Conflicts of Interest Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to another entity pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such entity. Our amended and restated memorandum and articles of association will provide that to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and us, on the other. Our sponsor and the other members of our management team are not restricted from participating in the formation of, and none of their affiliates are restricted from, becoming a sponsor or an officer or director of, any other special purpose acquisition company. Although we have no formal policy in place for vetting potential conflicts of interest, our board of directors will review any potential conflicts of interest on a case-by-case basis. Any such companies may present additional conflicts of interest in pursuing an acquisition target. We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our initial business combination. For more information, see the section entitled Management Conflicts of Interest. 35 Table of Contents SUMMARY FINANCIAL DATA The following table summarizes the relevant financial data for our business as of June 30, 2022, on an actual basis and as adjusted to give effect to the sale of the units in this offering, the sale of the private warrants and the other transactions described below as if they occurred on that date. The summary financial data should be read together with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. June 30, 2022 Actual As Adjusted Balance Sheet Data: Working capital (deficiency)(1) $ (786,755 ) $ 1,513,382 Total assets(2) $ 605,691 $ 201,833,936 Total liabilities(3) $ 786,755 $ 9,495,961 Value of Class A ordinary shares subject to possible redemption(4) $ $ 200,000,000 Shareholder s deficit(5) $ (181,064 ) $ (7,662,025 ) ____________ (1) The as adjusted calculation includes $2,015,000 cash held outside the trust account, $605,691 of pre-paid offering expenses, less $320,554 of over-allotment liability, less $786,755 of existing working capital deficiency. (2) The as adjusted calculation includes $200,000,000 cash held in trust from the proceeds of this offering and the sale of the private placement units, plus $2,015,000 in cash held outside the trust account, plus $181,064 of actual shareholder s deficit as of June 30, 2022. (3) The as adjusted calculation includes $6,000,000 of deferred underwriting commissions, $3,175,408 of warrant liabilities and $320,554 of over-allotment liability. (4) The as adjusted calculation equals the as adjusted total assets, less the as adjusted total liabilities, less the as adjusted shareholder s deficit. (5) Excludes 20,000,000 public shares which are subject to redemption in connection with our initial business combination. The as adjusted calculation equals the as adjusted total assets, less the as adjusted total liabilities, less the value of the Class A ordinary shares that may be redeemed in connection with our initial business combination (initially $10.00 per share). 36 Table of Contents RISKS
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+SUMMARY
+This summary highlights selected information from this prospectus. It may not contain all of the information that is important to you. You should carefully read the entire prospectus and the other documents referred to in this prospectus before making an investment in our Class A Ordinary Shares. You should carefully consider, among other things, our consolidated financial statements and the related notes and the sections titled Risk Factors, Business, and Management s Discussion and Analysis of Financial Condition and Results of Operations included elsewhere in this prospectus. For additional information, see Where You Can Find More Information in this prospectus.
+Overview
+We are a leading digital-first, value-based care company. Founded in 2013, our mission is to make high-quality healthcare accessible and affordable for everyone on Earth. We believe we are poised to reengineer the global healthcare market to better align system-wide incentives and to shift the focus from reactive sick care to preventative healthcare, resulting in better member health, improved member experience and reduced costs. To achieve this goal, we are leveraging our highly scalable, digital-first platform combined with high quality clinical operations and affiliated provider networks to provide an integrated, end-to-end healthcare solution. We combine artificial intelligence and broader technologies with human expertise to deliver modern healthcare. Through the devices people already own, we offer millions of people globally ongoing, always-on care.
+We monetize our products and services in three primary ways:
+ Value-Based Care ( VBC ), in which we manage a defined subset or the entire medical costs of a member population and capture the cost savings. During the years ended December 31, 2021, 2020, and 2019, 68.4%, 32.9%, and 0.0%, respectively, of our revenue was derived from VBC arrangements.
+ Software Licensing, in which we predominantly sell our digital suite of products to partners who may provide care through their own medical networks. During the years ended December 31, 2021, 2020, and 2019, 18.6%, 31.0%, and 12.5%, respectively, of our revenue was derived from software licensing.
+ Clinical Services, in which our affiliated providers deliver medical consultations, typically on a fee-for-service ( FFS ), or a combination of capitation fee and FFS basis under a risk-based agreement. During the years ended December 31, 2021, 2020, and 2019, 13.0%, 36.1%, and 87.5%, respectively, of our revenue was derived from clinical services.
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+As of December 31, 2021, our VBC, software and/or clinical service offerings supported patients in 15 countries. We have scaled our VBC offering rapidly over the last year to become one of the largest VBC networks in the United States, with 166,518 U.S. VBC members as of December 31, 2021, and we expect to remain focused on U.S. growth. Our company has built a technology-enabled platform and capability which we have leveraged in some of the most challenging healthcare environments globally. The major milestones of our business are listed below:
+ 2013: Founded by our Chief Executive Officer, Dr. Ali Parsadoust.
+ 2014: Became the first digital-first health service provider to be registered with the CQC, the healthcare services regulator and inspector in England. In response to primary care doctor shortages in the United Kingdom, Babylon contracted with the National Health Service (the NHS ) to offer a technology platform to improve accessibility to primary care and to doctors, proving out the ability to tackle accessibility with high quality in a very advanced U.K. healthcare market.
+ 2015: Began providing clinical services through our virtual care platform, offering diagnoses, advice and treatments via medical professionals to patients on a remote basis.
+ 2016: First expanded outside the United Kingdom, launching in Rwanda. We sought to prove our model in a more challenging environment and partnered with the Bill and Melinda Gates Foundation and the government of Rwanda, a country with limited resources and infrastructure for healthcare.
+ 2017: Made our technology available for licensing to corporate and institutional clients.
+ 2018: Launched our agreement with Prudential in Asia, and since then have been rolling out our Symptom Checker and Health Assessment solutions across 11 countries in Asia.
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+ 2018: Launched our partnership with TELUS Health, a healthcare provider in Canada and a subsidiary of TELUS Corporation ( TELUS ), the Canadian parent holding company of various telecommunication and other subsidiaries. TELUS agreed to use our platform to deliver digital health services across Canada through a joint venture named Babylon Health Canada Limited. We sold Babylon Health Canada Limited to TELUS in January 2021 and entered into a seven-year agreement to license our white-labeled digital platform to TELUS Health, allowing TELUS Health to provide integrated clinical services to members through a TELUS-branded version of the Babylon digital platform.
+ 2020: Entered the U.S. market with a clinical services network and formed our first end-to-end digital, integrated VBC service, Babylon 360. Babylon 360 has since expanded in the U.S. and is being introduced in the U.K. through our agreement with The Royal Wolverhampton NHS Trust ( RWT ).
+ 2021: Became a public company in the United States, with our Class A Ordinary Shares and warrants listed on the NYSE, upon completing our merger (the Business Combination ) with Alkuri Global Acquisition Corp. ( Alkuri ), a special purpose acquisition company, on October 21, 2021. In addition, we completed a private placement of our Class A Ordinary Shares to certain investors for an aggregate purchase price of $224 million (the PIPE Investment ).
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+We have also completed strategic investments, acquisitions, and divestitures in recent years that have helped improve our ability to deliver our products and services:
+ DayToDay. In October 2019, we purchased a majority stake in Health Innovators Inc. (d/b/a DayToDay) ( DayToDay ). On December 20, 2021, we issued 247,112 Class A Ordinary Shares to the owners of DayToDay, pursuant to a Stock Purchase Agreement, dated as of September 27, 2021, as consideration for our purchase, on November 16, 2021, of the remaining equity stake in DayToDay. The DayToDay acquisition is intended to bolster our product offering by providing patient management for acute care episodes.
+ Higi. On May 15, 2020, we acquired 10.2% of the fully diluted capital stock of higi SH Holdings Inc. ( Higi ). Through a series of investments, we then increased our shareholdings in Higi to 25.3% on a fully diluted basis. On December 7, 2021, we exercised our option to acquire the remaining equity interest in Higi pursuant to the Second Amended and Restated Agreement and Plan of Merger, dated October 29, 2021 (the Higi Acquisition Agreement ). The closing of this acquisition occurred on December 31, 2021. The exercise price of the option to acquire the remaining Higi equity stake included the payment of $4.6 million in cash and the issuance of 3,412,107 Class A Ordinary Shares at the closing, the payment of $5.4 million at the closing to satisfy the principal and interest payable by a subsidiary of Higi pursuant to a promissory note in favor of ALP Partners Limited ( ALP ), an entity owned by our founder and Chief Executive Officer, the future payment of up to $0.3 million and issuance of up to 490,782 additional Class A Ordinary Shares after the expiration of a 15-month indemnification holdback period, and the issuance of 1,980,000 restricted stock units for Higi continuing employees and consultants in respect of Class A Ordinary Shares, of which 1,167,669 were vested at closing. The Higi shareholders who received our shares are subject to a lockup and were granted certain registration rights. Higi provides digital healthcare services via a network of Smart Health Stations located in the United States, and makes health kiosks found in retail pharmacies and grocery stores that provide free screenings of blood pressure, weight, pulse and body mass index. The Higi acquisition is intended to increase our reach to users and our ability to provide clinical service offerings to our customers.
+ Fresno Health Care. In October 2020, we acquired certain portions of the Fresno Health Care business of First Choice Medical Group (together, FCMG ) for $25.7 million. This acquisition was intended to advance the growth of our value-based care services, by transitioning members to digital- first tools that will enable members to access our virtual care network in conjunction with the existing physical access to services.
+ Babylon Health Canada Limited. On January 14, 2021 we entered into a Share Purchase Agreement ( SPA ) with TELUS for the sale of the Babylon Health Canada Limited business. The entire issued share capital of Babylon Health Canada Limited was transferred to TELUS for a base price of CAD$1.8 million, which has been adjusted for working capital and net indebtedness. A further CAD$3.5 million payment was made by TELUS that was attributable to a partial repayment of an intercompany loan due from Babylon Canada to Babylon Partners Limited. The remaining amount of the intercompany loan was forgiven immediately prior to the execution of the SPA.
+ Meritage Medical Network. In April 2021, we acquired Meritage Medical Network ( Meritage ) for $31.0 million. This acquisition was intended to expand the growth of our value-based care services, by transitioning over 20,000 Medicare 
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+Advantage and Commercial HMO patients within the Meritage network to digital-first tools that will enable members to access our virtual care network in conjunction with the existing physical access to services.
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+Recent Developments
+Business Combination with Alkuri Global Acquisition Corp. and Related Transactions
+On October 21, 2021, we consummated the Business Combination with Alkuri, and executed an agreement (the Business Combination Agreement ) pursuant to which we issued 10,973,903 Class A Ordinary Shares to the shareholders of Alkuri (not including shares issued in connection with the Sponsor Earnout Shares discussed below) and assumed warrants for the purchase of 14,558,333 Class A Ordinary Shares previously issued by Alkuri, and Alkuri became our wholly-owned subsidiary.
+At the closing of the Business Combination (the Business Combination Closing ), Alkuri merged with and into Liberty USA Merger Sub, Inc., our new wholly owned subsidiary, with Alkuri continuing as the surviving company and a wholly owned subsidiary of Babylon. Each share of Alkuri common stock (including the Alkuri common stock held by the Sponsor (as defined in the Business Combination Agreement) but excluding shares held in treasury by Alkuri) was automatically converted into the right to receive one (1) Class A Ordinary Share of Babylon. Each warrant to purchase shares of Alkuri s common stock and right to receive shares of Alkuri common stock that was outstanding immediately prior to the effective time of the Business Combination was assumed by us and automatically converted into a warrant to purchase our Class A Ordinary Shares and a right to receive our Class A Ordinary Shares.
+Immediately prior to the Business Combination Closing, we effected a reclassification whereby all of our shareholders held Class A Ordinary Shares or Class B Ordinary Shares. The Class B Ordinary Shares have the same economic terms as the Class A Ordinary Shares, but the Class B Ordinary Shares have 15 votes per share (while each Class A Ordinary Share has one vote per share).
+Also in connection with the Business Combination Closing, (i) we issued to Dr. Ali Parsadoust (the Founder ), 38,800,000 Class B Ordinary Shares (the Stockholder Earnout Shares ), which are subject to restrictions if and until milestones based on the achievement of certain price targets of Class A Ordinary Shares following the Business Combination Closing are met, and (ii) of the 7,187,500 shares of Alkuri Class B Common Stock that were converted into 7,187,500 Class A Ordinary Shares at the Business Combination Closing, 1,293,750 of such shares (the Sponsor Earnout Shares and together with the Stockholder Earnout Shares, the Earnout Shares ) are also subject to similar restrictions (based on the achievement of certain price targets of Class A Ordinary Shares following the Business Combination Closing). In the event such milestones are not met, all of the Earnout Shares will be automatically converted into redeemable shares which we can redeem for $1.00. The Sponsor and the Founder each immediately became the legal and beneficial owners of their respective Earnout Shares at the Business Combination Closing, but such shares are subject to transfer restrictions if and until the milestones are met. The Earnout Shares have all the rights and privileges with respect to Class A Ordinary Shares for the Sponsor Earnout Shares and Class B Ordinary Shares for the Stockholder Earnout Shares (including the right to vote such shares and, with respect to the Stockholder Earnout Shares, rights to receive on a current basis cash dividends or other distributions made with respect to such shares with such amounts held by Babylon in respect of the Sponsor Earnout Shares until such shares are no longer subject to transfer restrictions and the milestone requirements).
+On June 3, 2021, we and Alkuri entered into the Subscription Agreements with certain accredited investors, certain Babylon shareholders, the Sponsor and affiliates of the foregoing (the PIPE Investors ). Pursuant to these Subscription Agreements, we issued and sold, in private placements that closed immediately prior to the Business Combination Closing, an aggregate of 22,400,000 of our Class A Ordinary Shares for $10.00 per share. The PIPE Investment included the issuance of 500,000 Class A Ordinary Shares to VNV (Cyprus) Limited, 500,000 Class A Ordinary Shares to Black Ice Capital Limited, an affiliate of VNV (Cyprus) Limited, 500,000 Class A Ordinary Shares to Kinnevik and 200,000 Class A Ordinary Shares to ALP.
+Additional Debt Financing
+On October 8, 2021, Babylon entered into a note subscription agreement pursuant to which Babylon issued $200 million unsecured Notes due 2026 (the Original Notes ) to certain affiliates of, or funds managed or controlled by, AlbaCore Capital LLP (the Note Subscribers ) on November 4, 2021 (the Initial Closing Date ). On December 23, 2021, Babylon entered into an additional note subscription agreement (the Second Note Subscription Agreement ) providing for the issue of not less than $75 million and not more than $100 million unsecured Notes due 2026 (the Additional Notes and together with the Original Notes, the Notes ) to AlbaCore Partners III Investment Holdings Designated Activity Company, and any new note subscribers that are affiliates of, or funds managed or controlled by, AlbaCore Capital LLP and that adhere to the Second Note Subscription Agreement. Vitality 
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+(Ireland) Financing Designated Activity Company (the Second Note Subscriber ) adhered to the Second Note Subscription Agreement on March 16, 2022.
+The closing of the issue of the Additional Notes under the Second Note Subscription Agreement, for the principal amount of $100 million (the Principal Amount ), occurred on March 31, 2022 (the Second Closing Date ). The Additional Notes are constituted on the terms of a supplemental deed poll that was issued by Babylon on the Second Closing Date (the Supplemental Deed Poll , and together with the deed poll issued by Babylon on the Initial Closing Date, the Notes Deed Poll ).
+On the Initial Closing Date, Babylon issued warrants to subscribe for an aggregate of 1,757,499 of its Class A Ordinary Shares (the Initial AlbaCore Warrants ) to the Note Subscribers, pursuant to a warrant instrument dated November 4, 2021 (the Original Warrant Instrument ) on a pro rata basis by reference to the relevant proportion of Original Notes subscribed for by each Note Subscriber. On the Second Closing Date, Babylon issued warrants to subscribe for an aggregate of 878,750 additional Class A Ordinary Shares to the Second Note Subscriber (the Additional AlbaCore Warrants and together with the Initial AlbaCore Warrants, the AlbaCore Warrants ) and the Original Warrant Instrument was amended and restated (as so amended and restated, the Amended and Restated Warrant Instrument ).
+The proceeds from the issue of the Additional Notes will be used by Babylon for general corporate purposes. Babylon is required to pay to the Second Note Subscriber and AlbaCore Partners III Investment Holdings Designated Activity Company an amount equal to all costs and expenses properly incurred by them in connection with the negotiation, preparation and execution of the Second Note Subscription Agreement, Supplemental Deed Poll and Amended and Restated Warrant Instrument and related documentation up to a maximum aggregate amount of $125,000 (inclusive of VAT) within 30 days of the Second Closing Date.
+The Additional Notes were issued at 100.00% of the Principal Amount, with an underwriting fee of 4.00% of the Principal Amount payable to the Second Note Subscriber on the issuance of the Additional Notes. The Additional Notes bear interest accruing (which for these purposes shall include any capitalized interest from time to time) at the following rates: (i) 8.00% per annum for the period commencing from (and including) the Second Closing Date to (but excluding) the date falling two years after the Initial Closing Date; (ii) 10.00% per annum for the period commencing from (and including) the date falling two years after the Initial Closing Date, to (but excluding) the date falling three years after the Initial Closing Date; and (iii) 12.00% per annum for the period commencing from (and including) the date falling three years after the Initial Closing Date. The applicable interest rate is subject to a step-up margin of 6.5 basis points per annum if Babylon and its subsidiaries do not achieve an agreed target of adding 100,000 Medicaid lives to value based care contracts by January 1, 2024.
+Interest on the Additional Notes is payable semi-annually in arrears in equal installments (except, in respect of the first interest payment falling on May 4, 2022 which shall be for the period from (and including) the Second Closing Date and ending on (but excluding) May 4, 2022) on May 4 and November 4 in each year (each an Interest Payment Date ), commencing with the Interest Payment Date falling on May 4, 2022. At Babylon s election, up to 50.00% of the interest payable in respect of any interest period may be satisfied by the issuance by Babylon of further notes to be immediately consolidated and form a single series with the outstanding Notes. The Notes will mature five years from the Initial Closing Date on November 4, 2026 (the Final Maturity Date ).
+The prior written consent of Babylon is required for any transfer of Notes, subject to certain exceptions. The AlbaCore Warrants are stapled to the Notes and no transfer of the Notes may occur unless an equivalent proportion of the AlbaCore Warrants is transferred at the same time.
+Babylon is required to redeem the Notes (unless previously purchased and cancelled or redeemed) on the Final Maturity Date at 100% of the principal amount on such date. Babylon may redeem the Notes at any time at a redemption amount (the Redemption Amount ) equal to: (i) from (and including) the Initial Closing Date to (but excluding) the date falling one year after the Initial Closing Date, the amount that is the greater of (A) 104.00% of the principal amount (including capitalized interest) and (B) 104.00% of the principal amount (including capitalized interest) plus an interest make whole premium; (ii) from (and including) the date falling one year after the Initial Closing Date to (but excluding) the date falling two years after the Initial Closing Date, 104.00% of the principal amount (including any capitalized interest); and (iii) on or after the date falling two years after the Initial Closing Date and until (but not including or after) the Final Maturity Date, 107.00% of the principal amount (including any capitalized interest). Each holder of Notes (each a Noteholder ) has the option to require Babylon to redeem the Notes held by such Noteholder at the Redemption Amount upon a change of control in respect of Babylon as specified in the Notes Deed Poll.
+Subject to certain limitations and exceptions, the Notes Deed Poll contains covenants limiting the ability of Babylon and its subsidiaries to, among other things: incur additional debt; pay or declare dividends or distributions on Babylon s share capital; repay 
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+or distribute any share premium reserve or redeem, repurchase or retire its share capital; incur or allow to remain outstanding guarantees; make certain joint venture investments; enter into finance or capital lease contracts; create liens on Babylon s or its subsidiaries assets; enter into sale and leaseback transactions; pay management and advisory fees outside the ordinary course of business; acquire a company or any shares or securities or a business or undertaking; merge or consolidate with another company; borrow or receive investments from certain shareholders other than through Babylon; and sell, lease, transfer or otherwise dispose of assets. The Notes Deed Poll also contains customary events of default.
+Following the issue of the Additional AlbaCore Warrants, the AlbaCore Warrants confer the right to subscribe for up to a maximum of 2,636,249 Class A Ordinary Shares exercisable on certain agreed exercise events (summarized below), subject to: (i) Babylon s right to elect to redeem the AlbaCore Warrants in whole or in part in cash upon an exercise event; (ii) an agreed adjustment formula to reduce the number of Class A Ordinary Shares to be issued upon exercise of the AlbaCore Warrants in certain circumstances linked to Babylon s trading performance; and (iii) customary adjustments for certain share capital reorganizations (such as share splits and consolidations).
+The exercise events applicable to the AlbaCore Warrants occur: (i) on the first date following which the closing price of the Class A Ordinary Shares has equaled or exceeded $15.00 per Class A Ordinary Share (subject to customary adjustments) for any 20 trading days within any 30-trading day period commencing at least 18 months after the Initial Closing Date; (ii) where the Noteholders give a redemption notice under the Notes Deed Poll on the occurrence of a change of control in respect of Babylon; (iii) where Babylon elects to redeem the Notes prior to the Final Maturity Date in accordance with its rights to do so under the Notes Deed Poll; and (iv) on the Final Maturity Date. Upon an exercise event, the AlbaCore Warrants are exercisable in full and not in part only.
+Upon any exercise event Babylon has a right to elect to satisfy the subscription entitlement in respect of the AlbaCore Warrants by issuing Class A Ordinary Shares, by making a redemption payment in cash, or by a combination of both (in such proportions as Babylon may in its absolute discretion determine). The cash redemption payment per AlbaCore Warrant shall be determined by reference to the closing price for the Class A Ordinary Shares on such date as is specified in the Amended and Restated Warrant Instrument in respect of each exercise event, provided that if the closing price is in excess of $15.00 per Class A Ordinary Share (subject to customary adjustments), the cash redemption payment shall be capped at $15.00 per AlbaCore Warrant.
+Where Babylon elects upon exercise of the AlbaCore Warrants to issue Class A Ordinary Shares in satisfaction in whole or in part of the subscription entitlement under the AlbaCore Warrants, Babylon is required to issue one Class A Ordinary Share credited as fully paid and free from all encumbrances (except as set out in Babylon s memorandum and articles of association from time to time) per AlbaCore Warrant held, subject to a proportionate downwards adjustment to the number of Class A Ordinary Shares to be issued per AlbaCore Warrant where the closing price of the Class A Ordinary Shares on such date as is specified in the Amended and Restated Warrant Instrument in respect of each exercise event is in excess of $15.00 per Class A Ordinary Share.
+Closing of Higi and DayToDay Acquisitions
+For information regarding our acquisition of DayToDay, and our acquisition of Higi, see the section titled Summary Overview in this prospectus.
+Corporate Information
+Babylon was incorporated under the laws of Jersey, Channel Islands, on April 11, 2014 with registered number 115471. The mailing address of Babylon s headquarters and principal executive offices is 1 Knightsbridge Green, London, SW1X 7QA, United Kingdom and Babylon s telephone number is +44 (0) 20 7100 0762.
+Our website is www.babylonhealth.com. The information on, or that can be accessed through, our website is not part of this prospectus, and you should not consider information contained on our website in deciding whether to purchase our Class A Ordinary Shares.
+Summary of Risk Factors
+Investing in our Class A Ordinary Shares involves risks. You should carefully consider the risks described in the Risk Factors beginning on page 18 before making a decision to invest in our Class A Ordinary Shares. If any of these risks actually occur, our business, financial condition or results of operations could be materially adversely affected. In such case, the trading price of our Class A Ordinary Shares may decline, and you may lose all or part of your investment. The following is a summary of some of the principal risks we face:
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+ We have a history of incurring losses, may not be able to achieve or maintain profitability, anticipate increasing expenses in the future and may require additional capital to support business growth. Additional financing may not be available on favorable terms or at all;
+ Our historical operating results and dependency on further capital raising indicate substantial doubt exists related to our ability to continue as a going concern;
+ If we fail to effectively manage our growth, we may be unable to execute our business plan, adequately address competitive challenges, maintain our corporate culture or grow at the rates we historically have achieved or at all;
+ We may face intense competition, which could limit our ability to maintain or expand market share within our industry;
+ Our existing customers may not continue or renew their contracts with us, or may renew at lower fee levels or decline to license additional applications and services from us, and significant reductions in members, per member per month (PMPM) fees, pricing or premiums under these contracts could occur due to factors outside our control;
+ We are dependent on our relationships with physician-owned entities and our business could be harmed if those relationships or our arrangements with our providers or our customers were disrupted;
+ Failure to maintain and expand a network of qualified providers could adversely affect our future growth and profitability;
+ We may be unable to increase engagement of the individual members that interact with our platform, and even if we are successful in increasing member engagement, if are unable to realize the member healthcare cost savings that we expect, our future profitability could be adversely affected;
+ A significant portion of our revenue comes from a limited number of customers, and the loss of a material contract could adversely affect our business;
+ The recognition of a portion of our revenue is subject to realizing healthcare cost savings and achieving quality performance metrics, and may not be representative of revenue for future periods;
+ Our claims liability estimates for medical costs and expenses are uncertain and may not be adequate, and adjustments to our estimates may unfavorably impact our financial condition. If our estimates of the amount and timing of revenue recognized under our licensing agreements and value-based care agreements with health plans are materially inaccurate, our revenue recognition could be impacted;
+ Our physician partners failure to accurately, timely and sufficiently document their services could result in nonpayment for services rendered or allegations of fraud. Our records and submissions to a health plan may contain inaccurate or unsupportable information regarding risk adjustment scores of members;
+ Reimbursement rates paid by third-party payers or federal, state or foreign healthcare programs may be reduced, and third-party payers or government payers may restrain our ability to obtain or provide services to our members;
+ Regulatory proposals directed at containing or lowering the cost of healthcare, including the ACO REACH model, and our participation in such proposed models, could impact our business and results of operations;
+ The market for telemedicine is immature and volatile and our digital-first approach is relatively new and unproven;
+ We may not be able to develop and release new solutions and services, or successful enhancements, new features and modifications to our existing solutions and services. Our proprietary solutions may not properly operate or interoperate with our customers existing and future infrastructures;
+ Our relatively limited operating history makes it difficult to evaluate our current business and future prospects;
+ If we are unable to hire and retain talent to operate our business, we may not be able to grow effectively;
+ Our growth depends in part on the success of our relationships with third parties;
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+ Our quarterly results may fluctuate significantly, adversely impacting the value of our Class A Ordinary Shares;
+ Risks associated with our international operations, economic uncertainty, or downturns;
+ Failure to adequately expand our direct sales force will impede our growth;
+ We may invest in or acquire other business and we may have difficulty integrating any such acquisitions successfully. We may also enter into collaborations and strategic alliances with third parties that may not result in the development of commercially viable solutions or the generation of significant future revenues;
+ Our use of open-source software could adversely affect our ability to offer our solutions and subject us to possible litigation;
+ Catastrophic events and man-made problems, and a pandemic, epidemic, or outbreak of an infectious disease, including the COVID-19 pandemic, could adversely affect our business;
+ Our sales and implementation cycle can be long and unpredictable and requires considerable time, expense and ongoing support, the failure of which may adversely affect our customer relationships;
+ Failure to obtain or maintain insurance licenses or authorizations allowing our participation in risk- sharing arrangements with payers could subject us to significant penalties and adversely impact our operations;
+ Foreign currency exchange rate fluctuations and restrictions could adversely affect our business;
+ We operate in a heavily regulated industry, and we are subject to evolving laws and government regulations;
+ The changes in tax laws in different geographic jurisdictions could materially impact our business. We may be treated as a dual resident company for United Kingdom tax purposes. The applicability of tax laws on our business is uncertain and adverse tax laws could be applied to us or our customers;
+ We may be unable to sufficiently protect our intellectual property, and our ability to successfully commercialize our technology may be adversely affected. We may be subject to intellectual property infringement claims, medical liability claims or other litigation or regulatory investigations;
+ Certain of our software products could become subject to U.S. Food and Drug Administration ( FDA ) oversight, and certain of our products and operations are subject to medical device regulations;
+ Cyberattacks, security breaches and other incidents, and other disruptions have compromised and could in the future compromise sensitive information and adversely affect our business and reputation. Our failure to comply with data privacy laws or to adequately secure the information we hold could result in significant liability or reputational harm. Any disruption of service at our third-party data and call centers or Amazon Web Services, or of third party infrastructure provider services, could interrupt our ability to serve customers, expose us to litigation and negatively impact our relationships with customers and members;
+ The trading price of our Class A Ordinary Shares is volatile, and the value of our Class A Ordinary Shares may decline. An active trading market for our securities may not develop or be sustained. The dual class structure of our ordinary shares limits your ability to influence important transactions and has an unpredictable impact on the trading market for our Class A Ordinary Shares;
+ Our status as an emerging growth company and a foreign private issuer may make our ordinary shares less attractive and affords less protection to our shareholders. We expect to lose our foreign private issuer status for 2022. As a controlled company, we qualify for exemptions from certain corporate governance requirements;
+ Our issuance of additional Class A Ordinary Shares will dilute all other shareholders. A significant portion of our total outstanding Class A Ordinary Shares are restricted from immediate resale but may be sold into the market in the near future, which could cause our share price to fall;
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+ We do not currently intend to pay dividends on our Class A Ordinary Shares. Some of our management team has limited experience managing a public company, and our management is required to devote substantial time to public company compliance;
+ If our remediation of our identified material weaknesses is not effective, or if we fail to develop an effective internal control system, our ability to produce timely and accurate financial statements or comply with applicable laws could be impaired;
+ U.S. holders that own 10% or more of our equity interests may be subject to adverse U.S. federal income tax consequences. Our U.S. holders may suffer adverse tax consequences if we are classified as a passive foreign investment company. The Internal Revenue Service may not agree that we are a non-U.S. corporation for U.S. federal income tax purposes;
+ Your shareholder rights and responsibilities are governed by Jersey law, which differs materially from U.S. companies shareholders rights and responsibilities. It may be difficult to enforce a U.S. judgment or to assert U.S. securities law claims outside of the United States; and
+ The other matters described in the remainder of the Risk Factors section of this prospectus.
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+Implications of Being an Emerging Growth Company and a Foreign Private Issuer
+Emerging Growth Company
+We are an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012. We are an emerging growth company until the earliest to occur of (i) the last day of the fiscal year (A) following the fifth anniversary of the first sale of the units of Alkuri pursuant to an effective registration statement on Form S-1 under the Securities Act of 1933, as amended (the Securities Act ), (B) in which we have total annual gross revenue of at least $1.07 billion, or (C) in which we are deemed to be a large accelerated filer, which means the market value of our outstanding ordinary shares that are held by non-affiliates exceeds $700 million as of the prior June 30, and (ii) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three year period.
+As an emerging growth company, we may take advantage of certain exemptions from various reporting requirements that are applicable to other publicly traded entities that are not emerging growth companies. These exemptions include: (i) the option to present only two years of audited financial statements and related discussion in the section titled Management s Discussion and Analysis of Financial Condition and Results of Operations in this prospectus; (ii) not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act of 2002; (iii) not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight Board, or PCAOB, regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); (iv) not being required to submit certain executive compensation matters to shareholder advisory votes, such as say-on-pay, say-on-frequency, and say-on-golden parachutes ; and (v) not being required to disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the chief executive officer s compensation to median employee compensation.
+In addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. This allows an emerging growth company to delay the adoption of these accounting standards until they would otherwise apply to private companies.
+We have elected not to opt out of, and instead to take advantage of, such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our financial statements with certain other public companies difficult or impossible because of the potential differences in accounting standards used.
+Foreign Private Issuer
+We report under the Exchange Act as a non-U.S. company with foreign private issuer status. Even after we no longer qualify as an emerging growth company, as long as we qualify as a foreign private issuer under the Exchange Act, we are exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies, including: (i) the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; (ii) the 
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+sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and (iii) the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q containing unaudited financial and other specific information, and current reports on Form 8-K upon the occurrence of specified significant events.
+Foreign private issuers are also exempt from certain more stringent executive compensation disclosure rules. Thus, even if we no longer qualify as an emerging growth company, but remain a foreign private issuer, we continue to be exempt from the more stringent compensation and other disclosures required of companies that are neither an emerging growth company nor a foreign private issuer.
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+the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under "Risk Factors" and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires: references to "amended and restated memorandum and articles of association" are to the amended and restated memorandum and articles of association of our company that we will adopt prior to the consummation of this offering; references to "we," "us" or "our company" are to Lakeshore Acquisition II Corp., a Cayman Islands exempted company; references to the "Companies Act" are to the Companies Act (2021 Revision) of the Cayman Islands as the same may be amended from time to time; references to "founder shares" are to the 1,437,500 ordinary shares initially issued to the initial shareholders (as defined below) for an aggregate purchase price of $25,000 on February 19, 2021 pursuant to certain subscription agreement. In connection with the increase in the size of the offering, on December 20, 2021, we declared a 20% share dividend on each founder share, thereby increasing the number of issued and outstanding founder shares to 1,725,000, including up to an aggregate of 225,000 founder shares subject to forfeiture by our insiders to the extent that the underwriters over-allotment option is not exercised in full or in part; references to the "private units" and "insider units" are to the 320,000 units (up to a maximum of 351,500 units if over-allotment option is exercised in full) we are selling privately to RedOne Investment Limited, our sponsor, and/or its designee upon consummation of this offering; references to our "initial shareholders" are to our sponsor and any other holders of founder shares, including our officers and directors; references to "ordinary shares" are to our ordinary shares, par value of US$0.0001 per share; references to our "management" or our "management team" are to our officers and directors; references to our "private shares" are to the ordinary shares included in the private units; references to our "private units" are to the units, each consisting of one ordinary share, one right, and one half of one redeemable warrant, that our sponsor is purchasing privately from us in a private placement concurrent with this offering, as well as any units issued upon conversion of working capital loans; references to our "private rights" are to the rights included in the private units; references to our "private warrants" are to the redeemable warrants included in the private units; references to our "public shares" are to ordinary shares which are being sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and references to "public shareholders" refer to the holders of our public shares, including our initial shareholders to the extent our initial shareholders purchase public shares, provided that their status as "public shareholders" shall exist only with respect to such public shares; references to our "public rights" are to the rights sold as part of the units in this offering (whether they are subscribed for in this offering or in the open market); references to the "representative" are to Network 1 Financial Securities, Inc., the representative of the underwriters; references to our "sponsor" are to RedOne Investment Limited, a BVI business company affiliated with our Chairman and Chief Executive Officer; and references to our "rights" and "warrants" are to the public rights and warrants, as well as the private rights and warrants, and any rights and warrants included in private units issued upon conversion of working capital loans. All references in this prospectus to our shares being forfeited shall take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. All references in this prospectus to share dividends shall take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. 1 You should rely only on the information contained in this prospectus. We have not, and the underwriters have not, authorized anyone to provide you with different information. We are not, and the underwriters are not, making an offer of these securities in any jurisdiction where the offer is not permitted. General We are a blank check company newly incorporated as a Cayman Islands exempted company on February 19, 2021. Exempted companies are Cayman Islands companies wishing to conduct business outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act . We were incorporated for the purpose of entering into a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or similar business combination with one or more businesses or entities, which we refer to as a "target business." Our efforts to identify a prospective target business will not be limited to a particular industry or geographic location except that according to our amended and restated memorandum and articles of association, we will not effectuate an initial Business Combination with a company that is headquartered in the People s Republic of China ("China"), the Hong Kong Special Administrative Region of China ("Hong Kong") or the Macau Special Administrative Region of China ("Macau") or conducts a majority of its operations in China, Hong Kong or Macau. We do not have any specific business combination under consideration and we have not (nor has anyone on our behalf), directly or indirectly, contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to such a transaction with our company. We will seek to capitalize on the significant contacts and experience of our management team, including Bill Chen, our Chairman, Chief Executive Officer and Chief Financial Officer, and H. David Sherman, Mingyu (Michael) Li and Jon M. Montgomery, each a member of our board of directors. In January 2021, Deyin (Bill) Chen founded Lakeshore Acquisition I Corp. ("LAAA"), a special purpose acquisition company incorporated for the purposes of effecting a business combination. Mr. Chen serves as the Chairman and the Chief Executive Officer of LAAA. LAAA completed its initial public offering in June 2021, in which it sold 5,467,000 units, each consisting of one LAAA ordinary share and three-quarters of one warrant, with each whole warrant entitling the holder thereof to purchase one ordinary share for $11.50 per share. The units were sold at a price of $10.00 per unit, generating aggregate proceeds of $54,670,000. As of the date of this prospectus, LAAA is in search of business combination targets. We believe our management team is well positioned to identify attractive risk-adjusted returns in the marketplace and that their professional contacts and transaction sources, ranging from industry executives, private owners, private equity funds, family offices, commercial and investment bankers, lawyers and other financial sector service providers and participants, in addition to the geographical reach of their affiliates, will enable us to pursue a broad range of opportunities. Our management believes that its collective ability to identify and implement value creation initiatives has been an essential driver of past performance and will remain central to its differentiated acquisition strategy. Upon the closing of this offering, members of our management team will communicate with these networks of relationships to articulate the parameters for our search for a target business and a potential business combination and begin the process of pursuing and reviewing promising leads. Deyin (Bill) Chen has been our Chief Executive Officer since February 24, 2021, and will also serve as our Chairman upon the closing of this offering. He has also been serving as the Chief Executive Officer and the Chairman of Lakeshore Acquisition I Corp. (Nasdaq: LAAA) since January 2021 and June 2021, respectively. Mr. Chen has a mixed background of engineering, finance, and operation management across industries and continents. Mr. Chen has been an independent advisor for merger and acquisition and equity transactions since August 2015. From February 2020 until March 2021, Mr. Chen served as a Special Advisor for Newborn Acquisition Corp. (NASDAQ:NBAC), a special purpose acquisition company that completed a business combination with Nuvve Corporation in March 2021. Since May 2017, Mr. Chen has served as Chief Executive Officer of Shanghai Renaissance Investment Management Co. Ltd., a licensed private equity firm in China that he founded. From March 2014 to August 2015, Mr. Chen served as Executive Vice President of Sanpower Group, a private conglomerate based in China, where he was in charge of cross-border merger and acquisition and post-merger integration. From January 2011 to January 2014, Mr. Chen served as Vice President of Strategy and Global Investment of JA Solar, a vertically integrated solar products manufacturing company based in China. From February 2005 to October 2010, Mr. Chen served as a Partner of BDO Capital Advisors and its affiliates in China with a focus on cross-border merger and acquisition and equity transactions. From June 2001 to August 2004, Mr. Chen served as a Senior Business Advisor to Capgemini, a consulting company based in Toronto Canada. From November 2000 to May 2001, Mr. Chen served as a Senior Financial Analyst in IBM Global Services in Toronto Canada. From December 1997 to November 2000, Mr. Chen served as a Staff Accountant in the General Accounting Department of Ashland Inc. Prior to his career in accounting and finance, Mr. Chen was an engineer and project manager in China from July 1987 to August 1993. 2 H. David Sherman, MBA, DBA, CPA will serve as a Director upon the closing of this offering. He has also been serving as a member of the board of directors of Lakeshore Acquisition I Corp. (Nasdaq: LAAA) since June 2021. Since 1985, Dr. Sherman has been a professor at Northeastern University, specializing in, among other areas, financial and management accounting, global financial statement analysis and contemporary accounting issues. Since January 2014, Professor Sherman has served as Trustee and Chair of the Finance Committee for the American Academy of Dramatic Arts, the oldest English language acting school in the world. Since July 2010, he has also served as a Board member and Treasurer for D-Tree International, a non-profit organization that develops and supports electronic clinical protocols to enable health care workers worldwide to deliver high quality care. Since September 2019, Dr. Sherman has served as an independent board member for Newborn Acquisition Corp. (NASDAQ:NBAC). Dr. Sherman previously served on the board and as audit committee chair for Dunxin Financial Holdings Ltd. (AMEX:DXF), a financial service company, Kingold Jewelry Inc. (NASDAQ: KGJI), a designer and manufacturer of gold jewelry-related products, China HGS Real Estate Inc. (NASDAQ: HGSH), a real estate company, Agfeed Corporation, a manufacturing company of agricultural products, and China Growth Alliance, Ltd., a business acquisition company formed to acquire an operating business in China. Dr. Sherman was previously on the faculty of the Sloan School of Management at Massachusetts Institute of Technology (MIT) and also, among other academic appointments, held an adjunct professorship at Tufts Medical School and was a visiting professor at Harvard Business School (2015). From 2004 to 2005, Dr. Sherman was an Academic Fellow at the U.S. Securities and Exchange Commission in the Division of Corporate Finance s Office of Chief Accountant. Dr. Sherman is a Certified Public Accountant and previously practiced with Coopers & Lybrand. Dr. Sherman s research has been published in management and academic journals including Harvard Business Review, Sloan Management Review, Accounting Review and European Journal of Operations Research. Mingyu (Michael) Li will serve as a Director upon the closing of this offering. Since August 2019, Mr. Li has served as Chief Executive Officer of Horizon Capital, a private equity firm focusing renewable and AI-driven manufacturing. In Horizon Capital, he has led a number of private equity fundraisings, managed advisory business for cross-border M&A. From January 2014 to January 2019, Mr. Li served as a Senior Partner at Hejun Capital, a private equity firm specializing in providing capital operation system solutions to high-growth enterprises. Hejun Capital was selected as the best private equity institution by Chinaventure for 2016. During his tenure in Hejun Capital, Mr. Li led two M&A transactions and post-merger integration projects involving listed companies in the media sector. From January 2012 to January 2013, Mr. Li served as the Director of Investment Banking in China Minsheng Bank, a leading commercial bank in China, where he was responsible for investment banking and financing needs of large energy companies. From April 2009 to December 2011, Mr. Li participated a few private equity fundraisings in real estate sector in China. From February 2007 to March 2009, Mr. Li began his career with Hejun Consulting, the largest comprehensive consulting company then in China. During his tenure at Hejun Consulting, Mr. Li was responsible for strategic consulting, M&A, and led or participated in more than 20 consulting projects. 3 Jon M. Montgomery will serve as a Director upon the closing of this offering. Mr. Montgomery is managing director at Meredith Financial Group Inc., a financial management and advisory firm located in New York City. He has served as an independent director of Nuvve Holding Corp. (NVVE.NASDAQ) since March 19, 2021. From 2010 to 2014, he was managing partner at project finance advisory firm AGlobal Partners LLC where he assisted in arranging long-term, limited-recourse financing for private investments in renewable energy, telecommunications, mining & metals, PPPs, and other infrastructure projects in emerging and other international markets. He also advised clients on foreign direct investments, including those utilizing development finance institutions, export credit agencies, and political risk insurers. In addition, Mr. Montgomery has more than 25 years of marketing consulting and market research experience, informing and guiding clients branding, communications, segmentation and innovation challenges across a range of industries, particularly in the information technology, telecommunications, financial services, CPG, pharmaceutical, and retail sectors. He is experienced in applying model-based quantitative analysis, particularly choice-based modeling, to solving competitive problems. Previously, from 1996 to 2010, Mr. Montgomery co-founded Hudson Group Inc. in New York, a research-based marketing consultancy. He also held prior positions as executive vice president at Marketing Strategy & Planning Inc./Synovate, and vice president at Hase Schannen Research Associates Inc. Mr. Montgomery holds a M.B.A. from Northeastern University and a B.A. from the University of California, Berkeley. Since 2000 he has been Adjunct Faculty in Marketing at the University of Georgia. We believe Mr. Montgomery is well-qualified to serve as a member of the board due to his investment banking, structuring and strategic expertise, his contacts in emerging and other international markets and his extensive experience in marketing and market research. The past performance of our management team or of their affiliates is not a guarantee either (i) that we will be able to identify a suitable candidate for our initial business combination or (ii) of success with respect to any business combination we may consummate. You should not rely on the historical record of our management team s or their affiliates performance as indicative of our future performance. Initial Business Combination We will have until 12 months from the closing of this offering to consummate our initial business combination. In addition, if we anticipate that we may not be able to consummate our initial business combination within 12 months, our sponsor may, but is not obligated to, extend the period of time to consummate a business combination 1 (one) time by an additional 3 months (for a total of up to 15 months to complete a business combination), provided that, pursuant to the terms of our amended and restated memorandum and articles of association and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company, the only way to extend the time available for us to consummate our initial business combination in the absence of a definitive agreement is for our sponsor, upon five days advance notice prior to the applicable deadline, to deposit into the trust account $600,000, or $690,000 if the over-allotment option is exercised in full ($0.10 per share in either case), on or prior to the date of the applicable deadline. In the event that our sponsor elected to extend the time to complete a business combination and deposited the applicable amount of money into trust, it would receive a non-interest bearing, unsecured promissory note equal to the amount of any such deposit that will not be repaid in the event that we are unable to close a business combination unless there are funds available outside the trust account to do so. Such notes would either be paid upon consummation of our initial business combination, or, at the relevant insider s discretion, converted upon consummation of our business combination into additional private units at a price of $10.00 per unit. Our shareholders have approved the issuance of the private units upon conversion of such notes, to the extent the holder wishes to so convert such notes at the time of the consummation of our initial business combination. In the event that we receive notice from our sponsor five days prior to the applicable deadline of its intent to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the applicable deadline announcing whether or not the funds had been timely deposited. Our sponsor is not obligated to fund the trust account to extend the time for us to complete our initial business combination. If we are unable to consummate our initial business combination within the extended time period, we will, as promptly as possible but not more than ten business days thereafter, redeem 100% of our outstanding public shares for a pro rata portion of the funds held in the trust account, including a pro rata portion of any interest earned on the funds held in the trust account and not previously released to us to pay our taxes, and then seek to dissolve and liquidate. However, we may not be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public shareholder. In the event of our dissolution and liquidation, the private units will expire and will be worthless. The public shareholders will not be able to vote on or redeem their public shares in connection with any such extensions. Nasdaq rules provide that our initial business combination must be with one or more target businesses that together have a fair market value equal to at least 80% of the balance in the trust account (less any taxes payable on interest earned) at the time of our signing a definitive agreement in connection with our initial business combination. If our board is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions with respect to the satisfaction of such criteria. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% fair market value test. If the business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the target businesses. If our securities are not listed on Nasdaq after this offering, we would not be required to satisfy the 80% requirement. However, we intend to satisfy the 80% requirement even if our securities are not listed on Nasdaq at the time of our initial business combination. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the "Investment Company Act". Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity securities of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. 4 We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions that our initial business combination is fair to our company (or shareholders) from a financial point of view. Members of our management team and our independent directors and their affiliates will directly or indirectly own ordinary shares and private units following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Additionally, each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to another entity, including other blank check companies similar to our company, pursuant to which such officer or director may be required to present a business combination opportunity to such entity. Specifically, our executive officers are affiliated with our sponsor and other entities that make, or are looking to make, investments in companies. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity that is suitable for an entity to which he or she has fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such entity, and only present it to us if such entity rejects the opportunity. We do not believe, however, that the fiduciary duties or contractual obligations of our executive officers will materially affect our ability to complete our business combination. For additional information regarding our executive officers and directors business affiliations and potential conflicts of interest, see "Management — Directors and Executive Officers" and "Management — Conflicts of Interest." Our amended and restated memorandum and articles of association will provide that, to the fullest extent permitted by applicable law, we renounce our interest or expectancy of our company in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and our company, on the other. Private Placements In connection with the increase in the size of the offering, on December 20, 2021, we declared a 20% share dividend on each founder share thereby increasing the number of issued and outstanding founder shares to 1,725,000 (up to 225,000 of which are subject to forfeiture) so as to maintain the number of founder shares at 20% of the outstanding shares of our ordinary shares upon the consummation of this offering, resulting in an effective purchase price per founder share after the share dividend of approximately $0.014. The per share purchase price of the founder shares was determined by dividing the amount of cash contributed to the company by the aggregate number of founder shares issued. The number of founder shares issued was determined based on the expectation that the founder shares would represent 20% of the outstanding shares after this offering (not including the shares to be issued to the underwriter at closing or the shares underlying the private placement units). Our initial shareholders have agreed not to transfer, assign or sell any of the founder shares and insider units (except to certain permitted transferees) until, with respect to 50% of the founder shares and insider units, the earlier of six months after the date of the consummation of our initial business combination and the date on which the closing price of our ordinary shares equals or exceeds $12.50 per share for any 20 trading days within a 30-trading day period following the consummation of our initial business combination and, with respect to the remaining 50% of the founder shares and insider units, six months after the date of the consummation of our initial business combination, or earlier in each case if, subsequent to our initial business combination, we complete a liquidation, merger, stock exchange or other similar transaction which results in all of our stockholders having the right to exchange their ordinary shares for cash, securities or other property. Our sponsor has agreed to purchase an aggregate of 320,000 units (or 351,500 units if the over-allotment option is exercised in full) at a price of $10.00 per unit for an aggregate purchase price of $3,200,000 (or $3,515,000 if the over-allotment option is exercised in full) in a private placement that will occur simultaneously with the closing of this offering. 5 Corporate Information We are an "emerging growth company," as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor internal controls attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an "emerging growth company" can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an "emerging growth company" for up to five years. However, if our non-convertible debt issued within a three year period or revenues exceeds $1.07 billion, or the market value of our shares that are held by non-affiliates exceeds $700 million on the last day of the second fiscal quarter of any given fiscal year, we would cease to be an emerging growth company as of the following fiscal year. Our executive offices are located at 667 Madison Avenue, New York, NY 10065, and our telephone number is (917)327-9933. 6
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, references to: amended and restated memorandum and articles of association are to our memorandum and articles of association to be in effect upon completion of this offering; China or the PRC refer to the People s Republic of China, including Hong Kong and Macau; Companies Act are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time. initial shareholders are to the holders of our founder shares prior to this offering; founder shares are to the ordinary shares initially purchased by our initial shareholders in a private placement prior to this offering; letter agreement are to the letter agreement, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team are to our officers and directors; ordinary shares are to our ordinary shares, par value $0.0001 per share, which include the public shares as well as the private placement shares; private placement rights are to the rights underlying the private placement units; private placement shares are to the ordinary shares underlying the private placement units; private placement units are to the units issued to our sponsor in a private placement simultaneously with the closing of this offering; private placement warrants are to the warrants underlying the private placement units; public rights are to the rights sold as part of the units in this offering (whether they are subscribed for in this offering or in the open market); public shares are to our ordinary shares offered as part of the units in this offering (whether they are subscribed for in this offering or thereafter in the open market); public shareholders are to the holders of our public shares; public units are to the units sold in this offering (whether they are subscribed for in this offering or in the open market); public warrants are to the redeemable warrants sold as part of the units in this offering (whether they are subscribed for in this offering or in the open market); rights are to our rights, which include the public rights as well as the private placement rights; sponsor are to WKA Asset Management (Hong Kong) Limited, a Hong Kong company; our sponsor is owned and controlled by Kevin Chow Zhu; units are to our units, which include the public units as well as the private placement units; warrants are to our redeemable warrants, which include the public warrants as well as the private placement warrants; and we, us, company, or our company are to Verity Acquisition Corporation., a Cayman Islands exempted company; 1 Table of Contents All references in this prospectus to our founder shares being forfeited shall take effect as surrenders for no consideration of such shares as a matter of Cayman Islands law. All references in this prospectus to share dividends shall take effect as share capitalizations as a matter of Cayman Islands law. Registered trademarks referred to in this prospectus are the property of their respective owners. General We are a blank check company incorporated in the Cayman Islands on June 11, 2019 and incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. Although there is no restriction or limitation on what industry or geographic region our target operates in, it is our intention to pursue prospective targets based in the United States in the healthcare sector. At the time of preparing this prospectus, we do not have any specific business combination under consideration or contemplation, and we have not, nor has anyone on our behalf, contacted any prospective target business or had any discussions, formal or otherwise, with respect to such a transaction. Our efforts to date are limited to organizational activities related to this offering. Background and Competitive Strengths We intend to focus our efforts on acquiring an operating company in the healthcare sector, although our efforts in identifying a prospective target business will not be limited to a particular industry. Our efforts in identifying prospective target businesses will not be limited to a particular geographic region, however our primary focus will be on businesses based in the United States. We believe that we will add value to these businesses primarily by providing them with access to the U.S. capital markets. Our management team comes with a wealth of experience in the financial, technology, and legal sectors. We will seek to capitalize on the strength of our management team who has worked together previously in another special purpose acquisition corporation and has successfully completed a business combination. Based on our management s extensive experience and industry exposure, we believe our management team will enable us to identify, structure and consummate a business combination. However, our management team s past performance is not an assurance that we will be able to identify an appropriate candidate for our initial business combination or achieve success with respect to the business combination we intend to consummate. For more information about our management s experience and profile, please see the Management section which begins on page 153 of this prospectus. Mr. Bing Lin has been our Chief Executive Officer and Chairman since May 2021. Mr. Lin has more than 18 years of investment and research experience. Since 2018, he has served as a Managing Director of Protocol Asset Management (HK) Limited, an activism hedge fund manager based in Hong Kong. Mr. Lin also served as advisor to several healthcare or biotechnology companies including New York Stock Exchange listed clinical-stage biologics company Ambrx Biopharma Inc between January 2019 to February 2020, biologics discovery platform Prosit Sole Biotechnology since February 2017 and clinical-stage drug discovery and development company Hepagene Therapeutics, Inc since March 2017. From February 2016 to December 2017, he served as a Managing Director of CM Asset Management (Hongkong) Company Limited. From November 2014 to December 2015, Mr. Lin founded and managed Gaohui Fund, a pan-Asia long/short equity fund. From February 2012 to October 2014, Mr. Lin was an Executive Director and a member of the investment committee of Keywise Capital Management (HK) Limited. From November 2004 to December 2011, Mr. Lin was a Principal and Chief Investment Officer of MICH Investments Limited. From August 2004 to October 2005, Mr. Lin was a Portfolio Manager for SSgA s Emerging Market Equity group. SSgA is one of the largest institutional asset managers worldwide. From September 2002 to July 2004, Mr. Lin was a research analyst of Joho Capital, LLC in New York. From January 1998 to August 2000, Mr. Lin was a CPA at Ernst & Young LLP in the United States. Mr. Lin received a B.A. in Accounting from Franklin University in 1996, an M.S. in accounting from Kent State University in 1997, and an MBA from the Harvard Graduate School of Business Administration in 2002. He lectures at Peking University as an Adjunct Professor and is a standing committee member of the Shanghai Finance Federation. Since 2013, Mr. Lin also lectures at Peking University as an Adjunct Professor for the International Pharmaceutical Engineering Management program, which was co-founded by Peking University and The United States Food and Drug Administration in 2006. Mr. Lin is well-qualified to serve as a director given his significant directorship experience, in-depth knowledge and experience in the Chinese and global capital markets, and his board experience in the finance sector for over 18 years. 2 Table of Contents We believe the experience and contacts of our management team will give us distinct advantages in sourcing, structuring and consummating acquisition transactions. We believe that our team has a strong mixture of skills, including experience with entrepreneurship, investment, legal, accounting and finance and marketing, which we believe will assist us in identifying a target and effecting a business combination. However, none of our management team is obligated to remain with the company after an acquisition transaction, and we cannot provide assurance that the resignation or retention of our current management will be a term or condition in any agreement relating to an acquisition transaction. Moreover, despite the competitive advantages we believe we have, we remain subject to significant competition with respect to identifying and executing an acquisition transaction. Leadership of an Experienced Management Team Our management team is led by our Chief Executive Officer and Chairman of our Board of Directors, Mr. Bing Lin, and our President, Mr. Man Chak Leung, our Chief Financial Officer, Ms. Qi Zhao, our Vice President Ms. Hiu Tung Kristy Chan and our Independent Directors, Mr. Gang Li, Dr. Jonathan Weiyan Seah and Ms. Michele Ann Smith. Mr. Man Chak Leung has been the President and a director of the Company since May 2021. Since August 2019, he has been serving as the General Manager of China Seven Star Holdings Limited, an investment holding company focusing consumer and healthcare sectors in China. Mr. Leung serves as Chief Executive Officer and Director of Metal Sky Star Acquisition Corporation since June 2021. Mr. Leung served as consultant to Silk Road Finance Corporation from May to December 2020. Mr. Leung served as Co-Head of Risk and Portfolio Management at China Minsheng Financial Holding Corporation Limited ( CM Financial ) from 2017 to May 2019, a Hong Kong mainboard listed financial holding platform. He is responsible for all portfolio including primary and secondary, fixed income and other special situations including SPAC. Mr. Leung joined CM Financial in December 2016 from TPG Growth, a global mid-market private equity firm with over US$ 15 billion AUM, where he spent 10 years as investment professional specializing in Healthcare, Financial Services, TMT, Consumer and Education in Greater China and South East Asia. Prior to that, he was with the Hong Kong office of the Cathay Capital Group between 2001 to 2006. He has cumulated extensive transaction experience including investments into eToro, Masan Group, FPT, ShangPharma, NT Pharma, Ivy Education Group, Vinda Paper and Rayli Magazine. He has also served on the board of the Ivy Education Group, a K12 Education Group in China between September 2015 to February 2017, CM SPC and CM Asset Management (Hongkong) Company Limited between July 2018 to May 2019 and CM International Financial Leasing Investment Holding Company Limited between January 2018 to November 2019. Mr. Leung holds a Bachelor of Business and Administration (Finance) from City University of Hong Kong. Ms. Qi Zhao has been our Chief Financial Officer ( CFO ) since May 2021. Ms. Zhao has more than 13 years of investment and financial background. She has served as founding partner and managing director at Singularity Financial Limited since May 2018, a fintech platform serving Investor Relations and ESG communication in Asia. Ms. Zhao joined Alpine River Capital Management as Investor Relations Manager from June 2010 to March 2016. From January 2008 to December 2009, Ms. Zhao was the Senior Vice President for investment banking division of both SBI E2Capital and Oriental Patron, focusing Hong Kong capital markets in the areas of equity sales, fundraising, and investor relations. Prior to it, from August 1997 to June 2007, Ms. Zhao also held various technical consulting roles for companies including Kingston Technologies, Software AG, previously known as webMethods Inc., serving clients including AT&T, Johnson & Johnson and Hewlett-Packard in the U.S. Ms. Zhao holds a B.S. degree in Computer Science from Franklin University and a B.A. degree in Journalism from Xiamen University. Ms. Hiu Tung Kristy Chan has been our Vice President since June 2021. She holds a California Real Estate Salesperson License. Since August 2020, she has been working as independent consultant of business development and, merger and acquisition on freelance basis while pursuing further study in Master of Arts at the Academy of Art University in San Francisco since February 2021. From February 2018 to August 2020, through arrangements with the financial advisory firm Sanuk Mak and the commercial real estate firm Kidder Mathews, she had worked on several commercial real estate projects relating to co-living, hospitality and repositioning a country club to the millennial market. In 2015, Ms. Chan participated in various private placements and fund raising for different clients through China Everbright International Securities, Global Capital Markets Department, in Hong Kong. Ms. Chan holds a Master of Science degree in Entrepreneurship and Innovation at University of San Francisco. 3 Table of Contents Mr. Gang Li is a director nominee. Mr. Li has been a Partner of Wilson Financial Holding Group, a licensed financial group in Hong Kong with the Hong Kong Securities and Futures Commission ( HKSFC ) Types 1, 4, 6 and 9 licenses, an insurance broker license and a trust company license, since October 2019. From September 2016 to March 2018, Mr. Li served as a Vice President of DTXS Silk Road Investment Holdings Company, a Hong Kong mainboard listed company. During the same period, he also served as Executive Director for MF Finance Limited, an affiliate company of DTXS Silk Road Investment Holdings Company. From May 2014 to July 2016, Mr. Li served as the Director of Commodity Business, CMBC International Holdings Limited. From 2011 to 2013, Mr. Li served as a General Partner of Beijing Huashan Capital Management Center Partners, a private equity fund and a fund management platform established under the Huashan Club of Minsheng Bank. Prior to that, between 2008 to 2011, Mr. Li was a Managing Director of Canada Wealth Management Company, a licensed third-party wealth management company providing high-end wealth management products and services in Vancouver. From 1993 to 2001, Mr. Li has held various managerial positions with China International Futures Co., Ltd. Mr. Li holds a Graduate Diploma of Accounting from McGill University, Montreal and a Bachelor of Business Administration (Investment Management) from Dongbei University of Finance and Economics in Dalian, China. Dr. Jonathan Weiyan Seah is a director nominee. Dr. Seah has over 25 years of experience in clinical medicine, investment banking, private equity, and general management in the US, China, and Southeast Asia. Dr. Seah is currently the Chairman of LifeHealth Group (Hong Kong), a healthcare startup which he co-founded in July 2018. Dr. Seah has served as Managing Director of IXL Capital since February 2014. Dr. Seah has served as a Managing Partner for Living Ventures Inc. from January 2009 to December 2018. Living Ventures, Inc., a private advisory company focusing on the healthcare sector, was the sole advisor to the owners of the Quality Healthcare group of clinics in Hong Kong, in their sale to Fortis Healthcare, among other projects. Dr. Seah had served as the Chairman, and previously the Chief Executive Officer of China Medical & HealthCare Group ( CMHG ) from December 2015 until September 2018. CMHG is a publicly-listed company on the Hong Kong Stock Exchange with a market capitalization at the time approximately USD 800 million. The company has 2,000 employees and owns and operates three hospitals in Nanjing, Kunming, and Shanghai, with 1,200 beds and a retirement village with 1,000 units in Shanghai. Dr. Seah was the founding CEO of ParkwayHealth s China Division, now part of IHH Healthcare Berhad, between December 2003 and December 2008, where he built the organization through new facilities and acquisitions over a five year period while under the ownership of private equity firm TPG. Dr. Seah was also the CEO of First Steamship, a publicly-listed shipping company in Taipei, between August 2012 to February 2014, and the Business Development Director at Biotronik USA in Oregon between March 2003 to September 2003. Prior to this Dr. Seah was a corporate finance investment banker with Merrill Lynch, in Palo Alto, California between September 1999 to March 2003. Before attending business school, Dr. Seah was a medical doctor in Singapore, at the National University Hospital, Tan Tock Seng Hospital, and at the Raffles Medical Group. Dr. Seah performed his military service as a Brigade Medical Officer in the Singapore Army, where his last rank was that of Captain. Dr. Seah has been a board member of several private and public companies, including Zenitas Healthcare between January 2016 to December 2018, Yuneec Electric Aviation between January 2015 to January 2017, Tongren Hospital between June 2010 to August 2013, Jiatai Group between June 2010 to June 2013, Grand Ocean Retail Group between July 2011 to July 2016 and Learning Ark Education between October 2009 to January 2019. Dr. Seah also served as a member of the New York Philharmonic Orchestra International Advisory Board between October 2016 and March 2018. He is a member of the Young Presidents Organization ( YPO ) Pacific Rim Chapter since October 2016. Dr. Seah holds an MBA from Harvard Business School and Bachelor of Medicine, Bachelor of Surgery, Bachelor of Obstetrics from the Royal College of Surgeons in Ireland. Ms. Michele Ann Smith is a director nominee. Since April 2019, Ms. Smith has worked as an attorney at Hartmann, Doherty, Rosa, Berman & Bulbulia ( HDRBB ), a New Jersey law firm, doing pro-bono and appointed work representing indigent clients in federal and state courts. Ms. Smith was a director at CM Seven Star Acquisition Corporation, a special purpose acquisition company from October 2017 until April 2019 where she served through the initial public offering of such company, search of target candidates and consummation of its business combination. Ms. Smith worked as an attorney at HDRBB, from September 2008 to January 2013. In October 2017, Ms. Smith returned to HDRBB after a period of family leave and served as a partner in the civil and criminal litigation groups until April 2019. From September 2006 to August 2008, she worked at Bonny Rafel LLC, an ERISA litigation boutique in New Jersey. From September 2002 to October 2003, Ms. Smith worked as an associate at Stroock & Stroock & Lavan LLP in New York City. From August 2000 to June 2002, Ms. Smith was the Albert M. Sacks Clinical Fellow at the Criminal Justice Institute at Harvard Law School where a Sacks Fellow, she spent two years representing indigent adults and juveniles in criminal and delinquency proceedings in the Massachusetts courts, and also assisted 4 Table of Contents the Criminal Justice Institute s efforts to advocate for national and local reform of the criminal and juvenile justice systems. From October 1999 to June 2000, Ms. Smith worked as an associate at Vorys, Sater, Seymour & Pease LLP, a law firm located in Cincinnati, Ohio. From September 1998 to September 1999, Ms. Smith clerked for the Honorable Susan J. Dlott, U.S. District Judge for the Southern District of Ohio. Ms. Smith is a member of the New Jersey and New York bars, is on inactive status with the Ohio bar and is retired from the Massachusetts bar. Ms. Smith received a B.A. in Political Science from Columbia University in 1993 and a J.D. from Harvard Law School with honors in 1998. Established Deal Sourcing Network We believe the strong track record of our management team will enable us to get access to quality deal pipeline. In addition, we believe we, through our management team, have contacts and sources from which to generate acquisition opportunities and possibly seek complementary follow-on business arrangements. These contacts and sources include those in government, media, private and public companies, private equity and venture capital funds, investment bankers, attorneys and accountants. Status as a Publicly Listed Acquisition Company We believe our structure will make us an attractive business combination partner to prospective target businesses. As a publicly listed company, we will offer a target business an alternative to the traditional initial public offering process. We believe that some target businesses will favor this alternative, which we believe is less expensive, while offering greater certainty of execution, than the traditional initial public offering process. During an initial public offering, there are typically underwriting fees and marketing expenses, which would be costlier than a business combination with us. Furthermore, once a proposed business combination is approved by our shareholders (if applicable) and the transaction is consummated, the target business will have effectively become public, whereas an initial public offering is always subject to the underwriter s ability to complete the offering, as well as general market conditions that could prevent the offering from occurring. Once public, we believe the target business would have greater access to capital and additional means of creating management incentives that are better aligned with shareholders interests than it would as a private company. It can offer further benefits by augmenting a company s profile among potential new customers and vendors and aid in attracting talented management staffs. With respect to the foregoing examples and descriptions, past performance by our management team is not a guarantee either (i) of success with respect to any business combination we may consummate or (ii) that we will be able to identify a suitable candidate for our initial business combination. Potential investors should not rely upon the historical record of our management as indicative of future performance. Acquisition Strategy Our efforts in identifying prospective target businesses will not be limited to a particular industry or country, although we intend to focus on businesses based in the United States and in the healthcare sector. In particular, we intend to focus our search for an initial business combination on private companies that have compelling economics and clear paths to positive operating cash flow, significant assets, and successful management teams that are seeking access to the U.S. public capital markets. We will seek to capitalize on the strength of our management team. We believe that our board and management s experiences, from evaluating assets through investing and company building, will enable us to identify businesses that have the capacity for cash flow creation, opportunity for operational improvement and robust company fundamentals, and enable us to execute a business combination with high-quality targets. Our selection process will leverage our board and management s broad network of relationships with leading startups, venture capitalists, private equity, hedge fund managers and respected peers, as well as our industry expertise and deal sourcing capabilities. Together with this network of trusted partners, we intend to capitalize the target business and create purposeful strategic initiatives in order to achieve attractive growth and performance after our initial business combination. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors, or completing the business combination through a joint venture or other form of shared ownership with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a target that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, would obtain an opinion from an independent accounting firm or independent investment banking firm that our initial business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other context. 5 Table of Contents Investment Criteria Consistent with our strategy, we have identified the following criteria to evaluate prospective target businesses. We will primarily seek to acquire one or more growth businesses with a total enterprise value of between $400,000,000 and $1,000,000,000. Although we may decide to enter into our initial business combination with a target business that does not meet the criteria described below, it is our intention to acquire companies that we believe: Unique competitive advantage in the markets and/or underexploited growth opportunities that our team is uniquely positioned to identify; We intend to seek target companies that have unique competitive advantages and/or underexploited expansion opportunities that can benefit from access to additional capital as well as expertise. We believe a large number of companies suffer from a lack of insightful strategy and capital for growth. We intend to target businesses that have historically demonstrated revenue growth and possess favorable future growth characteristics, combined with a durable business model that is resistant to macroeconomic volatility. Our management team has significant experience in identifying such targets and in helping target management assess the strategic and financial fit. Strong management team that can create significant value for the target company; We will seek to identify companies with strong and experienced management teams that will complement the operating and investment abilities of our management team. We believe we can provide a platform for the existing management team to leverage the experience of our management team. We believe that the operating expertise of our management team is well suited to complement the target s management team. Potential for strong free cash flow generation; We will seek to identify target companies that have the potential to generate strong, stable and increasing free cash flow. We intend to focus on one or more businesses that have predictable revenue streams and definable low working capital and capital expenditure requirements. We may also seek to prudently leverage this cash flow in order to enhance shareholder value. Exhibit unrecognized value or other characteristics that we believe have been misevaluated by the market; We will seek target companies which exhibit characteristics that we believe have been overlooked or misevaluated by the marketplace based on our company-specific analyses and due diligence. We intend to leverage the significant experience and disciplined investment approach of our team to identify opportunities to unlock value that our experience in complex situations allows us to pursue. Ready to be public, and will benefit from access to capital markets; We will look for public-ready management teams that have a track record of value creation for their shareholders, with the ambition to take advantage of the improved liquidity and additional capital that can come from a successful listing in the United States. We believe that there are a substantial number of potential target businesses with appropriate valuations that can benefit from a public listing and new capital to support significant revenue and earnings growth. Sourcing of Potential Business Combination Targets We believe that the operational and transactional experience of our management team and their respective affiliates, and the relationships they have developed as a result of such experience, will provide us with a substantial number of potential business combination targets. These individuals and entities have developed a broad network of contacts and corporate relationships around the world. This network has grown through sourcing, acquiring and financing businesses, relationships with sellers, financing sources and target management teams and experience in executing transactions under varying economic and financial market conditions. We believe that these networks of contacts and relationships will provide us important sources of investment opportunities. In addition, we anticipate that target business candidates may be brought to our attention from various unaffiliated sources, including investment market participants, private equity funds and large business enterprises seeking to divest noncore assets or divisions. 6 Table of Contents Our acquisition criteria, due diligence processes and value creation methods are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC. Other Acquisition Considerations We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or an independent accounting firm that our initial business combination is fair to our company from a financial point of view. Unless we complete our initial business combination with an affiliated entity, or our Board of Directors cannot independently determine the fair market value of the target business or businesses, we are not required to obtain an opinion from an independent investment banking firm, another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or from an independent accounting firm that the price we are paying for a target is fair to our company from a financial point of view. If no opinion is obtained, our shareholders will be relying on the business judgment of our Board of Directors, which will have significant discretion in choosing the standard used to establish the fair market value of the target or targets, and different methods of valuation may vary greatly in outcome from one another. Such standards used will be disclosed in our tender offer documents or proxy solicitation materials, as applicable, related to our initial business combination. Members of our management team may directly or indirectly own our ordinary shares and/or private placement units following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Each of our directors and officers presently has, and in the future any of our directors and our officers may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present acquisition opportunities to such entity. Accordingly, subject to his or her fiduciary duties under Cayman Islands law, if any of our officers or directors becomes aware of an acquisition opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she will need to honor his or her fiduciary or contractual obligations to present such acquisition opportunity to such entity, and only present it to us if such entity rejects the opportunity. Our amended and restated memorandum and articles of association will provide that, subject to his or her fiduciary duties under Cayman Islands law, we renounce our interest in any corporate opportunity offered to any officer or director unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue. We do not believe, however, that any fiduciary duties or contractual obligations of our directors or officers would materially undermine our ability to complete our business combination. Our sponsor, officers and directors may become an officer or director of other special purpose acquisition companies with a class of securities registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act. Notwithstanding that, such officers and directors will continue to have a pre-existing fiduciary obligation to us and we will, therefore, have priority over any special purpose acquisition companies they subsequently join. Initial Business Combination NASDAQ rules require that our initial business combination must be with one or more target businesses that together have an aggregate fair market value equal to at least 80% of the balance in the trust account (less any deferred underwriting discounts and taxes payable on interest earned) at the time of our signing a definitive agreement in 7 Table of Contents connection with our initial business combination. If our Board of Directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or an independent accounting firm. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. We will have until 9 months from the closing of this offering (or 15 months from the closing of this offering if we have executed a definitive agreement for an initial business combination within 9 months from the closing of this offering, but have not completed the initial business combination within such 9-month period) to consummate our initial business combination. In addition, if we anticipate that we may not be able to consummate our initial business combination within 9 months and we have not entered into a definitive agreement for an initial business combination by such date, our insiders or their affiliates may, but are not obligated to, extend the period of time to consummate an initial business combination one time by an additional three months to 12 months from the closing of this offering (or 18 months from the closing of this offering if we have executed a definitive agreement for an initial business combination within 12 months from the closing of this offering, but have not completed the initial business combination within such 12-month period), provided that, pursuant to the terms of our amended and restated memorandum and articles of association and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, the only way to extend the time available for us to consummate our initial business combination from 9 months to 12 months in the absence of a definitive agreement is for our insiders or their affiliates or designees, upon five days advance notice prior to the applicable deadline, to deposit into the trust account $1,750,000, or $2,012,500 if the over-allotment option is exercised in full ($0.10 per share in either case), on or prior to the date of the applicable deadline. In the event that they elected to extend the time to complete a business combination and deposited the applicable amount of money into trust, the insiders would receive a non-interest bearing, unsecured promissory note equal to the amount of any such deposit that will not be repaid in the event that we are unable to close a business combination unless there are funds available outside the trust account to do so. Such notes would either be paid upon consummation of our initial business combination, or, at the relevant insider s discretion, converted upon consummation of our business combination into additional private placement units at a price of $10.00 per unit. Our shareholders have approved the issuance of the private placement units upon conversion of such notes, to the extent the holder wishes to so convert such notes at the time of the consummation of our initial business combination. In the event that we receive notice from our insiders five days prior to the applicable deadline of their intent to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the applicable deadline announcing whether or not the funds had been timely deposited. Our insiders and their affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. To the extent that some, but not all, of our insiders, decide to extend the period of time to consummate our initial business combination, such insiders (or their affiliates or designees) may deposit the entire amount required. You will not be able to vote on or redeem your shares in connection with any such extension. If we are unable to consummate our initial business combination within such time period, we will, as promptly as possible but not more than ten business days thereafter, redeem 100% of our outstanding public shares for a pro rata portion of the funds held in the trust account, including a pro rata portion of any interest earned on the funds held in the trust account (less up to $50,000 of the net interest earned thereon to pay dissolution expenses), and then seek to dissolve and liquidate. However, we may not be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public stockholders. In the event of our dissolution and liquidation, the private placement units will expire and will be worthless. If we are unable to consummate an initial business combination within such time period, we will, as promptly as reasonably possible but not more than ten business days thereafter, redeem 100% of the outstanding public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including any interest earned on the funds held in the trust account (net of interest that may be used by us to pay our taxes payable and for dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law and as further described herein, and then seek to dissolve and liquidate. We expect the pro rata redemption price to be approximately $10.00 per public share (regardless of whether or not the underwriters exercise their over-allotment option) (subject to increase of up to an additional $0.10 per share in the event that our sponsor elects to extend the period of time to consummate a business combination by three months), without taking into account any interest earned on such funds. However, we cannot assure you that we will in fact be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public shareholders. 8 Table of Contents Our sponsor, officers, and directors have agreed that we will have only 9 months from the closing of this offering (or 15 months from the closing of this offering if we have executed a definitive agreement for an initial business combination within 9 months from the closing of this offering, but have not completed the initial business combination within such 9-month period) to complete our initial business combination, unless we extend such period to 12 months from the closing of the offering (or 18 months from the closing of this offering if we have executed a definitive agreement for an initial business combination within 12 months from the closing of this offering, but have not completed the initial business combination within such 12-month period). If we are unable to execute a definitive agreement for a business combination within 9 months (or 12 months if such period is extended) from the closing of this offering or we are unable to complete our initial business combination within 15 months (or 18 months if such period is extended), we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable, and less up to $50,000 of interest to pay dissolution expenses) divided by the number of then outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our Board of Directors, liquidate and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our public warrants, private placement warrants, public rights and private placement rights. The warrants and rights will expire worthless if we fail to execute a definitive agreement for a business combination within 9 months (or 12 months if such period is extended) from the closing of this offering or if we fail to complete our initial business combination within 15 months (or 18 months if such period is extended) provided we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering. You will not be able to vote on or redeem your shares in connection with any such extension. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock or shares of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If our initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. Potential Conflicts Members of our management team will directly or indirectly own ordinary shares, or other instruments, such as warrants or rights, linked to our ordinary shares, following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. 9 Table of Contents Our officers and directors have agreed to present to us all target business opportunities that have a fair market value of at least 80% of the assets held in the trust account, subject to any fiduciary or contractual obligations they may have. As more fully discussed in Management Conflicts of Interest, if any of our officers or directors becomes aware of an initial business combination opportunity that might be attractive to any entity to which he has fiduciary or contractual obligations, he may be required to present such initial business combination opportunity to such entity prior to presenting such initial business combination opportunity to us. For more information on the relevant pre-existing fiduciary duties or contractual obligations of our management team, see the section titled Management Conflicts of Interest. Potential Acquisition in China Because our sponsor, officers and directors have significant ties to Hong Kong, we may acquire a target business with offices and/or primary operations in China. There are significant legal and operational risks associated with investing in a target business with its primary operations in China., These risks could result in a material change in our post-business combination operations, reduce the value of our common stock and/or significantly limit or completely hinder our ability to offer or continue to offer securities to investors and/or cause the value of such securities to significantly decline or be worthless. Recent statements and regulatory actions by China s government, such as those related to the use of variable interest entities and data security or anti-monopoly concerns, has or may impact a post business combination company s ability to conduct its business, accept foreign investments, or list on an U.S. or other foreign exchange. In addition, the Chinese government plays a significant role in regulating industry development through imposition of industrial policies. The Chinese government also exercises significant control over China s economic growth by allocating resources, controlling payment of foreign currency-denominated obligations, setting monetary policy and providing preferential treatment to particular industries or companies. Given the Chinese government s significant oversight and discretion over the conduct of business of any China based company that we may target for an initial business combination, the Chinese government may intervene or influence the operations of our target at any time, which could result in a material change in our operations and/or value of our ordinary shares. See Risk Factors Risks Associated with Doing Business and Acquiring and Operating a Business in China The Chinese government may intervene or influence the operations of a target business that we acquire at any time, which could result in a material change in our operations and/or the value of our securities. Structuring a transaction in China The PRC government has restricted or limited foreign ownership of certain kinds of assets and companies operating in certain industries. The restricted industry groups are broad, including certain aspects of telecommunications, advertising, food production and heavy equipment manufacturers. In addition, there can be restrictions on the foreign ownership of businesses determined from time to time to be in important industries that may affect the national economic security or having famous Chinese brand names or well established Chinese brand names. Subject to the review and approval of the Ministry of Commerce and other relevant agencies as discussed elsewhere for acquisitions of assets and companies in the PRC and subject to the various percentage ownership limitations that exist from time to time, acquisitions involving foreign investors and parties in the various restricted categories of assets and industries may nonetheless sometimes be consummated using contractual arrangements with permitted Chinese parties. To the extent such agreements are employed, they may be for control of specific assets such as intellectual property or control of blocks of the equity ownership interests of a company which may provide exceptions to the merger and acquisition regulations mentioned above since these types of arrangements typically do not involve a change of equity ownership in PRC operating company. The agreements would be designed to provide us with the economic benefits of and control over the subject assets or equity interests similar to the rights of full ownership, while leaving the technical ownership in the hands of Chinese parties who would be our nominees and, therefore, may exempt the transaction from the merger and acquisition regulations, including the application process required thereunder. However, there has been limited implementation guidance provided with respect to the merger and acquisition regulations. PRC government agencies could apply these rules to a business combination effected through contractual arrangements. If such an agency determines such an application should have made, consequences may include levying fines, revoking business and other licenses, requiring restructure of ownership or operations and requiring discontinuation of any portion of all of the acquired business. These agreements likely also would provide for increased ownership or full ownership and control by us when and if permitted under PRC law and regulations. 10 Table of Contents If we effect an initial business combination that employs these types of control arrangements, we may have difficulty in enforcing our rights. Therefore, these contractual arrangements may not be as effective in providing us with the same economic benefits, accounting consolidation or control over a target business as would direct ownership. If the target business or any other entity fails to perform its obligations under these contractual arrangements, we may incur substantial costs and expend substantial resources to enforce such arrangements, and rely on legal remedies under Chinese law. These remedies include seeking specific performance or injunctive relief, and claiming damages, which we cannot assure will be sufficient to offset the cost of enforcement and may adversely affect the benefits we expect to receive from the business combination. While we have determined not to utilize or complete a business combination with any target company that utilizes any VIE structure, we acknowledge that in the event we did consummate our initial business combination with a target business based in and primarily operating in China utilizing a VIE structure due to restrictions imposed by PRC laws and regulations on foreign investment in certain industries, the combined company may be a company incorporated in jurisdictions other than the PRC, such as the Cayman Islands, and may conduct substantially all of its business operations in the PRC through the PRC subsidiaries and VIEs, while the combined company will not hold any direct equity interests in the VIEs. The combined company s PRC subsidiaries will control the VIEs through a series of contractual arrangements with the VIEs, as well as their founders and owners. Under such structure, the VIEs may hold key operating licenses, provide services to customers, and enter into contracts with suppliers and employ workforce. These contractual arrangements with the VIEs are put into place as a mechanism for the combined company s PRC subsidiaries to (i) exercise control over the VIEs, (ii) receive substantially all of the economic benefits of the VIEs, and (iii) have an exclusive option to purchase all or part of the equity interests in the VIEs when and to the extent permitted by PRC law. These contractual arrangements often include exclusive technology and consulting service agreements, equity interest pledge agreements, exclusive option agreements and powers of attorney. As a result of these contractual arrangements, the combined company will exert control over, and will be considered the primary beneficiary of the VIEs and is able to consolidate such VIEs operating results in its financial statements under the U.S. GAAP. Under such corporate structure, the combined company whose securities will be listed on a U.S. stock exchange after the business combination will not hold any direct equity interests in the VIEs. If such structure is utilized by the combined company, the investors of the combined company will not be holding equity interest of the operating business in China. As a result, the control through these contractual arrangements may be less effective than direct ownership, and the combined company could face heightened risks and costs in enforcing these contractual arrangements, because there are substantial uncertainties regarding the interpretation and application of current and future PRC laws, regulations, and rules relating to the legality and enforceability of these contractual arrangements. If the PRC government finds such agreements to be illegal, the PRC subsidiaries and the VIEs of the combined company could be subject to severe penalties or the combined company could be forced to relinquish its interests in the VIEs. Under such circumstances, the value of the combined company s securities may significantly decline, or in extreme cases, become worthless. To our knowledge, the enforceability of the contractual arrangements used in connection with the VIE structure have not been tested in a court of law. See Risk Factors Risks Associated with Doing Business and Acquiring and Operating a Business in China If we acquire a target business through contractual arrangements with, or which results in, one or more operating businesses in China, such contracts may not be as effective in providing operational control as direct ownership of such businesses. and Risk Factors Risks Associated with Doing Business and Acquiring and Operating a Business in China If, due to restrictions on foreign investment in a target business, we have to acquire the business through the use of contractual arrangements and the PRC government determines that such contractual arrangements do not comply with foreign investment regulations, or if these regulations or the interpretation of existing regulations in the PRC change or new restrictive or prohibitive regulations come into force in the future, we could be subject to significant penalties or be forced to relinquish our interests in those operations. Potential Approvals from the PRC Governmental Authorities for our Company s operations in China and issuance of securities to foreign investors The Regulations on Mergers and Acquisitions of Domestic Companies by Foreign Investors (the M&A Rules ), adopted by six PRC regulatory agencies in 2006 and amended in 2009, require an offshore special purpose vehicle formed for the purpose of an overseas listing of securities in a PRC company to obtain the approval of the China Securities Regulatory Commission (the CSRC ) prior to the listing and trading of such special purpose vehicle s securities on an overseas stock exchange. However, substantial uncertainty remains regarding the scope and applicability of the M&A Rules to offshore special purpose vehicles. 11 Table of Contents Recently, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointly issued the Opinions on Strictly Cracking Down on Illegal Securities Activities According to Law (the Opinions ), which were made available to the public on July 6, 2021. The Opinions call for strengthened regulation over illegal securities activities and supervision on overseas listings by China-based companies and propose to take effective measures, such as promoting the development of relevant regulatory systems to deal with the risks and incidents faced by China-based overseas-listed companies. The Opinions also provide that the State Council will revise provisions regarding the overseas issuance and listing of shares by companies limited by shares and will clarify the duties of domestic regulatory authorities. As of the date of this prospectus, no official guidance and related implementation rules have been issued in relation to the recently issued Opinions and the interpretation and implementation of the Opinions remain unclear at this stage. While the application of the M&A Rules remains unclear, based on our understanding of the current PRC laws and regulations, no prior permission is required under the M&A Rules or the Opinions from any PRC governmental authorities (including the CSRC) for consummating this offering by the Company or for the Company s current operations in China. The Company s operations includes the process of searching and conducting due diligence on target businesses and the process of negotiating and closing a business combination if we decide to consummate the business combination with a target business based in and primarily operating in China. However, there can be no assurance that the relevant PRC governmental authorities, including the CSRC, would reach the same conclusion as us, or that the CSRC or any other PRC governmental authorities would not promulgate new rules or new interpretation of current rules to require us to obtain CSRC or other PRC governmental approvals for this offering, for the process of searching and conducting due diligence on a target business or for the business combination if we decide to consummate the business combination with a target business based in and primarily operating in China. If the CSRC or another PRC governmental authority subsequently determines that its approval is needed for this offering, the process of searching and conducting due diligence on target businesses and/or for negotiating and completing a business combination with a target business based in and primarily operating in China, we may face adverse actions or sanctions by the CSRC or other PRC governmental authorities. These governmental authorities may delay this offering or a potential business combination, impose fines and penalties, limit our operations in China, or take other actions that could result in our inability to consummate an initial business combination with a China-based business, or materially adversely affect our business, financial condition, results of operations, reputation and prospects, as well as the trading price of our securities. See Risk Factors Risks Associated with Acquiring and Operating a Business in China The CSRC or other PRC governmental authorities may take the view now or in the future that an approval from them is required for an overseas offering by a company affiliated with Chinese businesses or persons or a business combination with a target business based in and primarily operating in China. Based on our understanding of the current PRC laws and regulations, the Company is not required to obtain any prior permission under the M&A Rules or the Opinions from any PRC governmental authorities (including the CSRC) for consummating this offering, given that: (a) the CSRC currently has not issued any definitive rule or interpretation concerning whether offerings like ours under this prospectus are subject to the M&A Rules; and (b) our company is a blank check company newly incorporated in the Cayman Islands rather than in China and currently the Company does not own or control any equity interest in any PRC company or operate any business in China. As of the date of this prospectus, we have not received any inquiry, notice, warning, sanctions or regulatory objection to this offering from the CSRC, the Cyberspace Administration of China (the CAC ), or any other PRC governmental authorities. We have been closely monitoring regulatory developments in China regarding any necessary approvals from the CSRC or other PRC governmental authorities required for overseas listings, including this offering, the process of searching and conducting due diligence on a target business or for the potential business combination with a target business based in and primarily operating in China. Government regulations relating to mergers and acquisitions We will initially face risks associated with structuring and completing a transaction to acquire a business in China that will comply with Chinese law. The Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors, or the M&A Rules, adopted by six PRC regulatory agencies in 2006 and amended in 2009, and other regulations and rules concerning mergers and acquisitions established additional procedures and requirements that could make merger and acquisition activities by foreign investors more time consuming and complex. The Anti-Monopoly Law of the PRC also requires that the PRC Ministry of Commerce ( MOFCOM ) be notified in advance of any concentration of undertaking if certain thresholds are triggered. 12 Table of Contents Depending on the structure of the transaction, these M&A Regulations require the Chinese parties to make a series of applications and supplemental applications to one or more of the aforementioned agencies, some of which must be made within strict time limits and depending on approvals from one or the other of the aforementioned agencies. The application process has been supplemented to require the presentation of economic data concerning a transaction, including appraisals of the business to be acquired and evaluations of the acquirer which will permit the government to assess the economics of a transaction in addition to the compliance with legal requirements. If obtained, approvals will have expiration dates by which a transaction must be completed. Completed transactions must also be reported to the Ministry of Commerce and some of the other agencies within a short period after closing or be subject to an unwinding of the transaction. In addition, the Circular of the General Office of the State Council on the Establishment of Security Review System for the Merger and Acquisition of Domestic Enterprises by Foreign Investors that became effective in March 2011, and the Rules on Implementation of Security Review System for the Merger and Acquisition of Domestic Enterprises by Foreign Investors issued by the Ministry of Commerce that became effective in September 2011 specify that mergers and acquisitions by foreign investors that raise national defense and security concerns and mergers and acquisitions through which foreign investors may acquire de facto control over domestic enterprises that raise national security concerns are subject to strict review by the MOFCOM. The rules prohibit any activities attempting to bypass a security review, including by structuring the transaction through a proxy or contractual control arrangement. The scope of the review includes whether the acquisition will impact national security, economic and social stability, and research and development capabilities on key national security related technologies. Foreign investors should submit a security review application to the Ministry of Commerce for its review of a contemplated acquisition. If the acquisition is considered within the scope of the security review regulations, the Ministry of Commerce will transfer the application to a joint security review committee consisting of members from various PRC government agencies, for further review. Complying with the requirements of the above-mentioned regulations and other relevant rules to complete acquisitions could be time consuming. Any required approval processes may delay or inhibit our ability to complete such transactions. We may also be prevented from pursuing certain investment opportunities if the PRC government considers that the potential investments will result in a significant national security issue. If we consummate a business combination with a business in China, we expect to retain legal experts in the PRC and the U.S. that are experienced with structuring offshore transactions with U.S. public companies. We plan to consult with PRC government officials when possible to assist us with complying with these structuring considerations and changing developments. Funds Flow under Contractual Arrangements If we decide to consummate our initial business combination with a target business based in and primarily operating in China, the combined company whose securities will be listed on a U.S. stock exchange may make capital contributions or extend loans to the PRC subsidiaries through intermediate holding companies subject to compliance with relevant PRC foreign exchange control regulations. To the extent that a VIE structure is utilized due to restrictions of foreign investment in the target s industry, the PRC subsidiaries may subsequently provide funds to the VIEs through extending loans subject to statutory limits and restrictions. After the business combination, the combined company s ability to pay dividends, if any, to the shareholders and to service any debt it may incur will depend upon dividends paid by the PRC subsidiaries which are entitled to substantially all of the economic benefits of the VIEs. Under PRC laws and regulations, PRC companies are subject to certain restrictions with respect to paying dividends or otherwise transferring any of their net assets to offshore entities. In particular, under the current PRC laws and regulations, dividends may be paid only out of distributable profits. Distributable profits are the net profit as determined under Chinese accounting standards and regulations, less any recovery of accumulated losses and appropriations to statutory and other reserves required to be made. A PRC company is required to set aside at least 10% of its after-tax profits each year to fund certain statutory reserve funds (up to an aggregate amount equal to half of its registered capital). As a result, the combined company s PRC subsidiaries may not have sufficient distributable profits to pay dividends to the combined company. Furthermore, if certain procedural requirements are satisfied, the payment in foreign currencies on current account items, including profit distributions and trade and service related foreign exchange transactions, can be made without prior approval from State Administration of Foreign Exchange (the SAFE ) or its local branches. However, where RMB is to be converted into foreign currency and remitted out of China to pay capital expenses, such as the repayment of loans denominated in foreign currencies, approval from or registration with competent government authorities or its authorized banks is required. The PRC government may take measures at its discretion from time to time to restrict access to foreign currencies for current account 13 Table of Contents or capital account transactions. If the foreign exchange control regulations prevent the PRC subsidiaries of the combined company from obtaining sufficient foreign currencies to satisfy their foreign currency demands, the PRC subsidiaries of the combined company may not be able to pay dividends or repay loans in foreign currencies to their offshore intermediary holding companies and ultimately to the combined company. We cannot assure you that new regulations or policies will not be promulgated in the future, which may further restrict the remittance of RMB into or out of the PRC. We cannot assure you, in light of the restrictions in place, or any amendment to be made from time to time, that the PRC subsidiaries of the combined company will be able to satisfy their respective payment obligations that are denominated in foreign currencies, including the remittance of dividends outside of the PRC. See Risk Factors Risks Associated with Doing Business and Acquiring and Operating a Business in China Governmental control of currency conversion may limit our ability to utilize our net revenue effectively and affect the value of your investment and Risk Factors Risks Associated with Doing Business and Acquiring and Operating a Business in China If we enter into a business combination with a target business operating in China under a VIE structure, PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent the combined company from using the proceeds from the business combination to make loans to or make additional capital contributions to the PRC subsidiaries and VIEs, which could materially and adversely affect PRC operating companies liquidity and ability to fund the operations. Government regulations relating to foreign exchange controls In July 2014, the State Administration of Foreign Exchange of the PRC ( SAFE ) promulgated the Circular on Relevant Issues Concerning Foreign Exchange Control on Domestic Residents Offshore Investment and Financing and Roundtrip Investment Through Special Purpose Vehicles, or SAFE Circular 37, to replace the Notice on Relevant Issues Concerning Foreign Exchange Administration for Domestic Residents Financing and Roundtrip Investment Through Offshore Special Purpose Vehicles, or SAFE Circular 75, which ceased to be effective upon the promulgation of SAFE Circular 37. SAFE Circular 37 requires PRC residents (including PRC individuals and PRC corporate entities) to register with SAFE or its local branches in connection with their direct or indirect offshore investment activities. SAFE Circular 37 applies to our shareholders who are PRC residents and may apply to any offshore acquisitions that we make in the future. Under SAFE Circular 37, PRC residents who make, or have prior to the implementation of SAFE Circular 37 made, direct or indirect investments in offshore special purpose vehicles, or SPVs, must register such investments with SAFE or its local branches. In addition, any PRC resident who is a direct or indirect shareholder of an SPV must update its filed registration with the local branch of SAFE with respect to that SPV, to reflect any material change. If our shareholders who are PRC residents or entities fail to make the required registration or to update the previously filed registration, any PRC subsidiaries may be prohibited from distributing their profits and any proceeds from any reduction in capital, share transfer or liquidation to us, and we may be restricted in our ability to contribute additional capital to any PRC subsidiaries. On February 13, 2015, SAFE promulgated a Notice on Further Simplifying and Improving Foreign Exchange Administration Policy on Direct Investment, or SAFE Notice 13, which became effective on June 1, 2015. Under SAFE Notice 13, applications for foreign exchange registration of inbound foreign direct investments and outbound overseas direct investments, including those required under SAFE Circular 37, will be filed with qualified banks instead of SAFE. The qualified banks will directly examine the applications and accept registrations under the supervision of SAFE. To the extent required, we have requested PRC residents who we know hold direct or indirect interests in us to make the necessary applications, filings and registrations as required under SAFE Circular 37. To the extent required, we believe that most of these shareholders have completed the initial foreign exchange registrations with relevant banks. However, these individuals may not continue to make required filings or updates in a timely manner, or at all. We may not know the identities of all PRC residents holding direct or indirect interest in our company. Any failure or inability by such individuals to comply with SAFE regulations may subject us to fines or legal sanctions, restrict our cross-border investment activities, and limit any PRC subsidiary s ability to distribute dividends to us. As a result, our business and our ability to make distributions to you could be materially adversely affected. Furthermore, as these foreign exchange regulations are still relatively new and their interpretation and implementation have been evolving, it is unclear how these regulations, and any future regulation concerning offshore or cross-border transactions, will be interpreted, amended and implemented by the relevant government authorities. 14 Table of Contents For example, we may be subject to a more stringent review and approval process with respect to our foreign exchange activities, such as remittance of dividends and foreign-currency-denominated borrowings, which may adversely affect our financial condition and results of operations. If we acquire a PRC domestic company, we or the owners of such company, as the case may be, may not obtain the necessary approvals or complete the necessary filings and registrations required by the foreign exchange regulations. This may restrict our ability to implement our acquisition strategy and could adversely affect our business and prospects. Implication of the Holding Foreign Companies Accountable Act The Holding Foreign Companies Accountable Act, or the HFCAA, was enacted on December 18, 2020. The HFCA Act states that if the SEC determines that an issuer s audit reports issued by a registered public accounting firm have not been subject to inspection by the PCAOB for three consecutive years beginning in 2021, the SEC shall prohibit such issuer s securities from being traded on a national securities exchange or in the over-the-counter trading market in the United States. If we decide to consummate our initial business combination with a target business based in and primarily operating in China, auditors of the combined company and their workpapers may be located in China, a jurisdiction where the PCAOB has been unable to conduct inspections without the approval of the PRC authorities. Therefore, the combined company s securities may be delisted from a national securities exchange in the U.S pursuant to the HFCA Act. Under certain pending legislation the time period leading up to a prohibition on trading may be shortened. A termination in the trading our of securities or any restriction on the trading in our securities would be expected to have a negative impact on the Company as well as on the value of our securities. While the Company s auditor is based in the U.S. and is registered with PCAOB and subject to PCAOB inspection, in the event it is later determined that the PCAOB is unable to inspect or investigate completely the Company s auditor because of a position taken by an authority in a foreign jurisdiction, then such lack of inspection could cause trading in the Company s securities to be prohibited under the Holding Foreign Companies Accountable Act, and ultimately result in a determination by a securities exchange to delist the Company s securities. See Risk Factors Risks Relating to Doing Business and Acquiring and Operating a Business in China U.S. laws and regulations, including the Holding Foreign Companies Accountable Act, may restrict or eliminate our ability to complete a business combination with certain companies, particularly those acquisition candidates with substantial operations in China, on pages 99 and 101. Government Regulations relating to Cybersecurity The PRC Criminal Law, as amended by its Amendment 7 (effective on February 28, 2009) and Amendment 9 (effective on November 1, 2015), prohibits institutions, companies and their employees from selling or otherwise illegally disclosing a citizen s personal information obtained in performing duties or providing services or obtaining such information through theft or other illegal ways. On November 7, 2016, the Standing Committee of the PRC National People s Congress issued the Cyber Security Law of the PRC, or Cyber Security Law, which became effective on June 1, 2017. Pursuant to the Cyber Security Law, network operators must not, without users consent, collect their personal information, and may only collect users personal information necessary to provide their services. Providers are also obliged to provide security maintenance for their products and services and shall comply with provisions regarding the protection of personal information as stipulated under the relevant laws and regulations. The Civil Code of the PRC (issued by the PRC National People s Congress on May 28, 2020 and effective from January 1, 2021) provides legal basis for privacy and personal information infringement claims under the Chinese civil laws. PRC regulators, including the Cyberspace Administration of China, the Ministry of Industry and Information Technology, and the Ministry of Public Security, have been increasingly focused on regulation in data security and data protection. PRC regulatory requirements regarding cybersecurity are evolving. For instance, various regulatory bodies in China, including the Cyberspace Administration of China, the Ministry of Public Security and the State Administration for Market Regulation, have enforced data privacy and protection laws and regulations with varying and evolving standards and interpretations. In April 2020, the Chinese government promulgated Cybersecurity Review Measures, which came into effect on June 1, 2020. According to the Cybersecurity Review Measures, operators of critical information infrastructure must pass a cybersecurity review when purchasing network products and services which do or may affect national security. 15 Table of Contents In July 2021, the Cyberspace Administration of China and other related authorities released the draft amendment to the Cybersecurity Review Measures for public comments through July 25, 2021. The draft amendment proposes the following key changes: companies who are engaged in data processing are also subject to the regulatory scope; the CSRC is included as one of the regulatory authorities for purposes of jointly establishing the state cybersecurity review working mechanism; the operators (including both operators of critical information infrastructure and relevant parties who are engaged in data processing) holding more than one million users/users (which to be further specified) individual information and seeking a listing outside China shall file for cybersecurity review with the Cybersecurity Review Office; and the risks of core data, material data or large amounts of personal information being stolen, leaked, destroyed, damaged, illegally used or transmitted to overseas parties and the risks of critical information infrastructure, core data, material data or large amounts of personal information being influenced, controlled or used maliciously shall be collectively taken into consideration during the cybersecurity review process. To the extent required, compliance with the Cybersecurity Review Measures may financially burden, limit and/or restrict the post business combination company from conducting its business operations or expanding it business. Moreover, for the reasons set forth above, we note that oversight by the CAC, if applicable, could negatively impact our process for searching for a target company and completing an initial business combination as well as our business operations on a post business combination basis. Specifically such oversight by the CAC could subject the post business combination company to the cybersecurity review procedures and any failure or delay in the completion of the cybersecurity review procedures or any other non-compliance with the related laws and regulations may result in fines or other penalties, including suspension of business, website closure, and revocation of prerequisite licenses, as well as reputational damage or legal proceedings or actions, which may have material adverse effect on the business, financial condition or results of operations of the Company. If the draft amendment is adopted into law in the future, we may become subject to enhanced cybersecurity review. Certain internet platforms in China have been reportedly subject to heightened regulatory scrutiny in relation to cybersecurity matters. As of the date of this prospectus, we have not been informed by any PRC governmental authority of any requirement that we file for a cybersecurity review. However, if we or the combined company following a business combination are deemed to be a critical information infrastructure operator or a company that is engaged in data processing and holds personal information of more than one million users, we could be subject to PRC cybersecurity review. As there remains significant uncertainty in the interpretation and enforcement of relevant PRC cybersecurity laws and regulations, we or the combined company following a business combination could be subject to cybersecurity review, and if so, we may not be able to pass such review in relation to this offering or a business combination. In addition, we could become subject to enhanced cybersecurity review or investigations launched by PRC regulators in the future. Any failure or delay in the completion of the cybersecurity review procedures or any other non-compliance with the related laws and regulations may result in fines or other penalties, including suspension of business, website closure, and revocation of prerequisite licenses, as well as reputational damage or legal proceedings or actions, which may have material adverse effect on our business, financial condition or results of operations. On June 10, 2021, the Standing Committee of the National People s Congress of China, or the SCNPC, promulgated the PRC Data Security Law, which became effective in September 2021. The PRC Data Security Law imposes data security and privacy obligations on entities and individuals carrying out data activities, and introduces a data classification and hierarchical protection system based on the importance of data in economic and social development, and the degree of harm it will cause to national security, public interests, or legitimate rights and interests of individuals or organizations when such data is tampered with, destroyed, leaked, illegally acquired or used. The PRC Data Security Law also provides for a national security review procedure for data activities that may affect national security and imposes export restrictions on certain data an information. On August 20, 2021, the Standing Committee of the National People s Congress adopted the Personal Information Property Law, which shall come into force as of November 1, 2021. The Personal Information Protection Law includes the basic rules for personal information processing, the rules for cross-border provision of personal information, the rights of individuals in personal information processing activities, the obligations of personal information processors, and the legal responsibilities for illegal collection, processing, and use of personal information. As uncertainties remain regarding the interpretation and implementation of these laws and regulations, we cannot assure you that we or the combined company following 16 Table of Contents a business combination will comply with such regulations in all respects and we or the combined company following a business combination may be ordered to rectify or terminate any actions that are deemed illegal by regulatory authorities. We or the combined company following a business combination may also become subject to fines and/or other sanctions which may have material adverse effect on our business, operations and financial condition. While we take various measures to comply with all applicable data privacy and protection laws and regulations, our current security measures and those of our third-party service providers may not always be adequate for the protection of our company, employee or third party data. We may be a target for computer hackers, foreign governments or cyber terrorists in the future. Unauthorized access to our proprietary internal and third party data may be obtained through break-ins, sabotage, breach of our secure network by an unauthorized party, computer viruses, computer denial-of-service attacks, employee theft or misuse, breach of the security of the networks of our third party service providers, or other misconduct. Because the techniques used by computer programmers who may attempt to penetrate and sabotage our proprietary internal and third party data change frequently and may not be recognized until launched against a target, we may be unable to anticipate these techniques. Unauthorized access to our proprietary internal and third party data may also be obtained through inadequate use of security controls. Any of such incidents may harm our reputation and adversely affect our business and results of operations. In addition, we may be subject to negative publicity about our security and privacy policies, systems, or measurements. Any failure to prevent or mitigate security breaches, cyber-attacks or other unauthorized access to our systems or disclosure of third party data, including their personal information, could result in loss or misuse of such data, interruptions to our service system, loss of confidence and trust in our company, impairment of our technology infrastructure, and harm our reputation and business, resulting in significant legal and financial exposure and potential lawsuits. Corporate Information Our executive offices are located at Office E, 7/F, 45 Pottinger Street, Central, Hong Kong and our telephone number is +852 63585597. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our ordinary shares that are held by non-affiliates exceeds $700 million as of the end of that year s second fiscal quarter; and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates exceeds $250 million as of the end of that year s second fiscal quarter, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates exceeds $700 million as of the end of that year s second fiscal quarter. 17 Table of Contents THE OFFERING In making your decision whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors beginning on page 43 of this prospectus. Securities offered 17,500,000 units, at $10.00 per unit, each unit consisting of: one ordinary share; one-half of one redeemable warrant to purchase one ordinary share; and one right entitling the owner to receive one-tenth (1/10) of one ordinary share upon consummation of our initial business combination. Proposed NASDAQ symbols Units: VERTU Ordinary Shares: VERT Warrants: VERTW Rights: VERTR Trading commencement and separation of ordinary shares, warrants and rights The units will begin trading promptly after the date of this prospectus. We expect the ordinary shares, warrants and rights comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Maxim informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the ordinary shares, warrants and rights commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into ordinary shares, warrants and rights. Separate trading of the ordinary shares and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the ordinary shares and warrants be traded separately until we have filed with the SEC a Current Report on Form 8-K which includes an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which is anticipated to take place three business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. 18 Table of Contents Units: Number outstanding before this offering 0 Number outstanding after this offering and the private placement 18,085,000(1) Ordinary shares: Number issued and outstanding before this offering 5,031,250(2,4) Number issued and outstanding after this offering and the private placement 22,460,000(3,4) Redeemable Warrants: Number of issued and outstanding before this offering 0 Number of warrants to be outstanding after this offering and the private placement 9,042,500(1) Exercisability Each unit contains one-half of one redeemable warrant. Each whole warrant is exercisable to purchase one of our ordinary shares. Exercise price $11.50 per share, subject to adjustment as described herein. In addition, if (x) we issue additional ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our initial shareholders or their affiliates, without taking into account any founder shares held by such shareholders or their affiliates, as applicable, prior to such issuance (the Newly Issued Price )), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for funding our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our ordinary shares during the 20 trading day period starting on the trading day prior to the day on which we consummate our business combination (such price, the Market Value ) is below $9.20 per share, the exercise price shall be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price described in the section Redemption of warrants will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. ____________ (1) Assumes no exercise of the underwriters over-allotment option. (2) Consists solely of founder shares and includes up to 656,250 ordinary shares that are subject to forfeiture by our initial shareholders depending on the extent to which the underwriters over-allotment option is exercised. Except as otherwise specified, the rest of this prospectus has been drafted to give effect to the full forfeiture of these 656,250 ordinary shares. (3) Includes 17,500,000 public shares, 4,375,000 founder shares and 585,000 private placement. (4) Founder shares are ordinary shares. 19 Table of Contents Exercise period The warrants will become exercisable on the later of: 30 days after the completion of our initial business combination, and 12 months from the date of this prospectus; provided in each case that we have an effective registration statement under the Securities Act covering the ordinary shares issuable upon exercise of the warrants and a current prospectus relating to them is available (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). We are not registering the ordinary shares issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable, but in no event later than 15 business days after the closing of our initial business combination, we will use our best efforts to file, and within 60 business days following our initial business combination to have declared effective, a registration statement covering the ordinary shares issuable upon exercise of the warrants, and to maintain a current prospectus relating to those ordinary shares until the warrants expire or are redeemed. No warrants will be exercisable for cash unless we have an effective and current registration statement covering the ordinary shares issuable upon exercise of the warrants and a current prospectus relating to such ordinary shares. Notwithstanding the foregoing, if a registration statement covering the ordinary shares issuable upon exercise of the warrants is not effective within a specified period following the consummation of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to the exemption provided by Section 3(a)(9) of the Securities Act of 1933, as amended, or the Securities Act, provided that such exemption is available. If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a cashless basis. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption of warrants Once the warrants become exercisable, we may redeem the outstanding warrants: in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period; and if, and only if, the last sale price of our ordinary shares equals or exceeds $18.00 per share (as adjusted for share splits, share capitalizations, rights issuances, subdivisions, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. 20 Table of Contents We will not redeem the warrants unless a registration statement under the Securities Act covering the ordinary shares issuable upon exercise of the warrants is effective and a current prospectus relating to those ordinary shares is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may not exercise our redemption right if the issuance of shares upon exercise of the warrants is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect such registration or qualification. We will use our best efforts to register or qualify such shares under the blue sky laws of the state of residence in those states in which the warrants were offered by us in this offering. If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In determining whether to require all holders to exercise their warrants on a cashless basis, our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our shareholders of issuing the maximum number of ordinary shares issuable upon the exercise of our warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of ordinary shares equal to the quotient obtained by dividing (x) the product of the number of ordinary shares underlying the warrants, multiplied by the excess of the fair market value (defined below) over the exercise price of the warrants by (y) the fair market value. The fair market value shall mean the average reported last sale price of the ordinary shares for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Please see the section entitled Description of Securities Redeemable Warrants Public Shareholders Warrants for additional information. The private placement warrants will be redeemable by us and exercisable by the holders on the same basis as the warrants included in the units being sold in this offering. Rights: Number of issued and outstanding before this offering 0 Number of rights to be outstanding after this offering and the private placement 18,085,000(1) Terms of Rights Except in cases where we are not the surviving company in a business combination, each holder of a public right will automatically receive one-tenth (1/10) of a share of common stock upon consummation of our initial business combination. In the event we will not be the surviving company upon completion of our initial business combination, each holder of a right will be required to affirmatively convert his, her or its rights in order to receive the one-tenth (1/10) of a share underlying each right upon consummation of the business combination. We will not issue fractional shares in connection with an exchange of rights. Fractional shares will either be rounded down to the nearest whole share or otherwise addressed in accordance with the applicable provisions of the Cayman law. ____________ (1) Assumes no exercise of the underwriters over-allotment option. 21 Table of Contents As a result, you must hold rights in multiples of 10 in order to receive shares for all of your rights upon closing of a business combination. If we are unable to complete an initial business combination within the required time period and we redeem the public shares for the funds held in the trust account, holders of rights will not receive any of such funds for their rights and the rights will expire worthless. Founder shares The Company was formed on June 11, 2019 as a Cayman Islands exempted company. On June 11, 2019, the Company issued 1 ordinary share to Bing Lin in exchange for $25,000. On June 2, 2021 the Company repurchased that 1 ordinary share at par value and then it was cancelled. On May 25, 2021, the Company issued an aggregate amount of 5,031,250 ordinary shares (up to 656,250 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised) in exchange for an aggregate amount of $25,000 or approximately $0.005 per share (the founder shares ). The founder shares are owned by the following parties (collectively the initial shareholders ): our sponsor WKA Asset Management (Hong Kong) Limited acquired 4,025,000 founder shares (up to 525,000 founder shares of which are subject to forfeiture, on a pro rata basis, depending upon the extent to which the underwriters over-allotment option is exercised) in exchange for $20,000; C Block Capital Group Limited acquired 456,250 founder shares (up to 131,250 founder shares of which are subject to forfeiture, on a pro rata basis, depending upon the extent to which the underwriters over-allotment option is exercised) in exchange for $2,268; Qi Zhao acquired 200,000 founder shares in exchange for $994; Man Chak Leung acquired 100,000 founder shares in exchange for $497; Hiu Tung Kristy Chan acquired 100,000 founder shares in exchange for $497; Gang Li acquired 50,000 founder shares for $248; Michele Ann Smith acquired 50,000 founder shares for $248 and Jonathan Weiyan Seah acquired 50,000 founder shares in exchange for $248. Prior to the initial investment in the company of $25,000 by our initial shareholders, the company had no assets, tangible or intangible. The purchase price of the founder shares was determined by dividing the amount of cash contributed to us by the number of founder shares issued. Our initial shareholders will own 20% of our issued and outstanding shares after this offering (assuming they do not purchase units in this offering and excluding the private placement shares and the Representative s shares). If we increase or decrease the size of the offering, we will effect a capitalization or share surrender or redemption or other appropriate mechanism, as applicable, with respect to our ordinary shares immediately prior to the consummation of the offering in such amount as to maintain the ownership of founder shares by our initial shareholders at 20% of our issued and outstanding ordinary shares upon the consummation of this offering (excluding the private placement shares and the Representative s shares). Up to 656,250 founder shares are subject to forfeiture by our initial shareholders depending on the extent to which the underwriters over-allotment option is exercised. The founder shares are identical to the ordinary shares included in the units being sold in this offering, except that: the founder shares are subject to certain transfer restrictions, as described in more detail below; 22 Table of Contents our initial shareholders, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed (i) to waive their redemption rights with respect to their founder shares and public shares in connection with the completion of our initial business combination and (ii) to waive their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to execute a definitive agreement for a business combination within 9 months (or 12 months if such period is extended) from the closing of this offering or if we fail to complete our initial business combination within 15 months (or 18 months if such period is extended) provided we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). You will not be able to vote on or redeem your shares in connection with any such extension. If we submit our initial business combination to our public shareholders for a vote, our initial shareholders have agreed, pursuant to such letter agreement, to vote their founder shares, private placement shares and any public shares purchased during or after this offering in favor of our initial business combination. As a result, in addition to our initial shareholder s founder shares, we would need only 6,270,001, or 35.83%, of the 17,500,000 public shares sold in this offering to be voted in favor of a transaction (assuming all outstanding shares are voted and all shares to be issued to Maxim and/or its designees are issued and outstanding and voted in favor of the business combination) or 655,001, or 3.74%, of the 17,500,000 public shares sold in this offering to be voted in favor of a transaction (assuming only a quorum is present at such meeting held to vote on our initial business combination and all shares to be issued to Maxim and/or its designees are issued and outstanding and voted in favor of the business combination) in order to have our initial business combination approved (assuming the over-allotment option is not exercised); the founder shares are subject to registration rights. Transfer restrictions on founder shares Our initial shareholders have agreed not to transfer, assign or sell any of its founder shares until the earlier to occur of: (A) six months after the completion of our initial business combination or (B) the date on which we complete a liquidation, merger, share exchange, reorganization or other similar transaction after our initial business combination that results in all of our public shareholders having the right to exchange their ordinary shares for cash, securities or other property (except as described herein under Principal Shareholders Transfers of Founder Shares and Private Placement Units ). We refer to such transfer restrictions throughout this prospectus as the lock-up. Notwithstanding the foregoing, following our initial business combination if, the last sale price of our ordinary shares equals or exceeds $12.00 per share (as adjusted for share splits, share capitalizations, rights issuances, subdivisions, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period, the founder shares will be released from the lock-up. 23 Table of Contents Founder shares conversion and anti-dilution rights We have issued 5,031,250 ordinary shares, $0.0001 par value to our initial shareholders. The number of founder shares issued was determined based on the expectation that the founder shares would represent 20% of the outstanding shares after this offering (excluding the ordinary shares underlying the private placement units, the private placement warrants and the private placement rights). As such, our initial shareholders will collectively own founder shares representing 20% of our issued and outstanding shares after this offering (assuming they do not purchase any units in this offering or the private placement). Up to 656,250 founder shares held by the initial shareholders, in the aggregate, will be subject to forfeiture, on a pro rata basis, depending upon the extent to which the underwriters over-allotment option is exercised so that our initial shareholders will maintain ownership of 20% of our ordinary shares after this offering (excluding the ordinary shares underlying the private placement units, private placement warrants and the private placement rights). If we increase or decrease the size of the offering, we will effect a share dividend or a share contribution back to capital, or other appropriate mechanism, as applicable, with respect to our ordinary shares immediately prior to the consummation of the offering in such amount as to maintain the ownership of our initial shareholders at 20% of our issued and outstanding ordinary shares upon the consummation of this offering. Private placement units Our sponsor has agreed to purchase an aggregate of 585,000 units at a price of $10.00 per unit for an aggregate purchase price of $5,850,000. Each private placement unit will be identical to the units sold in this offering, except as described in this prospectus. The private placement units will be sold in a private placement that will close simultaneously with the closing of this offering, including the over-allotment option, as applicable. There will be no redemption rights or liquidating distributions from the trust account with respect to the founder shares, private placement shares, private placement warrants or private placement rights. The warrants and rights will expire worthless if we do not consummate a business combination within the allotted 9 months (or 12 months if such period is extended) from the closing of this offering or if we fail to complete our initial business combination within 15 months (or 18 months if such period is extended) provided we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering. Our sponsor has agreed to waive its redemption rights with respect to its private placement shares (i) in connection with the consummation of a business combination, (ii) in connection with a shareholder vote to amend our amended and restated memorandum and articles of association to modify the substance or timing of our obligation to redeem 100% of our public shares if we fail to execute a definitive agreement for a business combination within 9 months (or 12 months if such period is extended) from the closing of this offering or if we fail to complete our initial business combination within 15 months (or 18 months if such period is extended) provided we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering and (iii) if we fail to execute a definitive agreement for a business combination within 9 months (or 12 months if such period is extended) from the closing of this offering or if we fail to complete our initial business combination within 15 months (or 18 months if such period is extended) provided 24 Table of Contents we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering or if we liquidate prior to the expiration of 9 months (or 12 months if such period is extended) from the closing of this offering or if we fail to complete our initial business combination within 15 months (or 18 months if such period is extended) provided we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering. However, our sponsor, officers and directors will be entitled to redemption rights with respect to any public shares held by them if we fail to consummate a business combination or liquidate within 9 months (or 12 months if such period is extended) from the closing of this offering or if we fail to complete our initial business combination within 15 months (or 18 months if such period is extended) provided we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering.). Transfer restrictions on private placement units The private placement units and their component securities will not be transferable, assignable or salable until 30 days after the consummation of our initial business combination except to permitted transferees. Private placement warrants The private placement warrants are identical to the warrants being sold as part of the units in this offering. Private placement rights The private placement rights are identical to the rights being sold as part of the units in this offering. Proceeds to be held in trust account The rules of NASDAQ provide that at least 90% of the gross proceeds from this offering and the private placement be deposited in a trust account. Of the net proceeds we will receive from this offering and the sale of the private placement units described in this prospectus, $175,000,000 ($10.00 per unit), or $201,250,000 ($10.00 per unit) if the underwriters over-allotment option is exercised in full (subject to increase of up to an additional $0.30 per unit in the event that our sponsor elects to extend the period of time to consummate a business combination, as described in more detail in this prospectus), will be deposited into a segregated trust account located in the United States with Continental Stock Transfer & Trust Company acting as trustee and $616,250 will be used to pay expenses in connection with the closing of this offering and for working capital following this offering. The proceeds to be placed in the trust account include $4,375,000 (or up to $5,031,250 if the underwriters over-allotment option is exercised in full) in deferred underwriting discounts. The funds in the trust account will be invested only in specified U.S. government treasury bills or in specified money market funds. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, if any, the proceeds from this offering and the private placement will not be released from the trust account until the earliest of (i) the completion of our initial business combination, (ii) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association to (A) modify the substance or timing of our obligation to redeem 100% of our public shares if we do not execute a definitive 25 Table of Contents agreement for a business combination within 9 months (or 12 months if such period is extended) from the closing of this offering or if we do not complete our initial business combination within 15 months (or 18 months if such period is extended) provided we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering or (B) with respect to any other provision relating to shareholders rights or pre-business combination activity and (iii) the redemption of all of our public shares if we are unable to execute a definitive agreement for a business combination within 9 months (or 12 months if such period is extended) from the closing of this offering or if we are unable to complete our initial business combination within 15 months (or 18 months if such period is extended) provided we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering, subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. You will not be able to vote on or redeem your shares in connection with any such extension. Ability to extend time to complete business combination We will have until 9 months from the closing of this offering (or 15 months from the closing of this offering if we have executed a definitive agreement for an initial business combination within 9 months from the closing of this offering, but have not completed the initial business combination within such 9-month period) to consummate our initial business combination. In addition, if we anticipate that we may not be able to consummate our initial business combination within 9 months and we have not entered into a definitive agreement for an initial business combination by such date, our insiders or their affiliates may, but are not obligated to, extend the period of time to consummate an initial business combination one time by an additional three months to 12 months from the closing of this offering (or 18 months from the closing of this offering if we have executed a definitive agreement for an initial business combination within 12 months from the closing of this offering, but have not completed the initial business combination within such 12-month period), provided that, pursuant to the terms of our amended and restated memorandum and articles of association and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, the only way to extend the time available for us to consummate our initial business combination from 9 months to 12 months in the absence of a definitive agreement is for our insiders or their affiliates or designees, upon five days advance notice prior to the applicable deadline, to deposit into the trust account $1,750,000, or $2,012,500 if the over-allotment option is exercised in full ($0.10 per share in either case), on or prior to the date of the applicable deadline. In the event that they elected to extend the time to complete a business combination and deposited the applicable amount of money into trust, the insiders would receive a non-interest bearing, unsecured promissory note equal to the amount of any such deposit that will not be repaid in the event that we are unable to close a business combination unless there are funds available outside the trust account to do so. Such notes would either be paid upon consummation of our initial business combination, or, at the relevant insider s discretion, converted upon consummation of our business 26 Table of Contents combination into additional private placement units at a price of $10.00 per unit. Our shareholders have approved the issuance of the private placement units upon conversion of such notes, to the extent the holder wishes to so convert such notes at the time of the consummation of our initial business combination. In the event that we receive notice from our insiders five days prior to the applicable deadline of their intent to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the applicable deadline announcing whether or not the funds had been timely deposited. Our insiders and their affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. To the extent that some, but not all, of our insiders, decide to extend the period of time to consummate our initial business combination, such insiders (or their affiliates or designees) may deposit the entire amount required. You will not be able to vote on or redeem your shares in connection with any such extension. If we are unable to consummate our initial business combination within such time period, we will, as promptly as possible but not more than ten business days thereafter, redeem 100% of our outstanding public shares for a pro rata portion of the funds held in the trust account, including a pro rata portion of any interest earned on the funds held in the trust account (less up to $50,000 of the net interest earned thereon to pay dissolution expenses), and then seek to dissolve and liquidate. However, we may not be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public stockholders. In the event of our dissolution and liquidation, the private placement units will expire and will be worthless. Anticipated expenses and funding sources Unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use, except the withdrawal of interest to pay taxes. Based upon current interest rates, we expect the trust account to generate approximately $87,500 of interest annually (assuming no exercise of the underwriters overallotment option and an interest rate of 0.05% per year) following the investment of such funds in specified U.S. government treasury bills or in specified money market funds. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement units not held in the trust account, which will be approximately $1,733,750 (or $1,208,750 if the over-allotment option is exercised in full) in working capital after the payment of approximately $616,250 (not including underwriter s discounts) in expenses relating to this offering; and any loans or additional investments from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation to advance funds or invest in us, and provided any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of a business combination. Up to $1,500,000 of such loans may be convertible into units at a price of $10.00 per unit at the option of the lender. 27 Table of Contents Conditions to completing our initial business combination There is no limitation on our ability to raise funds privately or through loans in connection with our initial business combination. NASDAQ rules require that our initial business combination must be with one or more target businesses that together have an aggregate fair market value equal to at least 80% of the balance in the trust account (less any deferred underwriting discounts and taxes payable on interest earned) at the time of our signing a definitive agreement in connection with our initial business combination. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. If our Board of Directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or an independent accounting firm. We will complete our initial business combination only if the post-transaction company in which our public shareholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our initial business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test, provided that in the event that our initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. Permitted purchases of public shares by our affiliates If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, officers, advisors or their affiliates may purchase shares in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Please see Proposed Business Permitted purchases of our securities for a description of how such persons will determine which shareholders to seek to acquire shares from. There is no limit on the number of shares such persons may purchase, or any restriction on the price that they may pay. Any such price per share may be different than the amount per share a public shareholder would receive if it elected to redeem its shares in connection with our initial business combination. However, such persons have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. In the event our sponsor, directors, officers, advisors or their affiliates determine to make any such purchases at the time of a shareholder vote relating to our initial business combination, such purchases could have the effect of influencing the vote necessary to approve such transaction. None of the funds in the trust account will 28 Table of Contents be used to purchase shares in such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. Subsequent to the consummation of this offering, we will adopt an insider trading policy which will require our initial shareholders to: (i) refrain from purchasing shares during certain blackout periods and when they are in possession of any material non-public information and (ii) to clear all trades with our legal counsel prior to execution. We cannot currently determine whether our initial shareholders will make such purchases pursuant to a Rule 10b5-1 plan, as it will be dependent upon several factors, including but not limited to, the timing and size of such purchases. Depending on such circumstances, our initial shareholders may either make such purchases pursuant to a Rule 10b5-1 plan or determine that such a plan is not necessary. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Our sponsor, directors, officers, advisors or their affiliates will not make any purchases if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. Redemption rights for public shareholders upon completion of our initial business combination We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest (which interest shall be net of taxes payable) divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.00 per public share (subject to increase of up to an additional $0.30 per unit in the event that our sponsor elects to extend the period of time to consummate a business combination, as described in more detail in this prospectus). The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting discounts we will pay to the underwriters. There will be no redemption rights upon the completion of our initial business combination with respect to our public warrants, public rights, private placement warrants or private placement rights. Our initial shareholders, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination. 29 Table of Contents Manner of conducting redemptions We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a shareholder meeting called to approve the business combination or (ii) by means of a tender offer. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under the law or stock exchange listing requirement. Under NASDAQ rules, asset acquisitions and stock purchases would not typically require shareholder approval while direct mergers with our company and any transactions where we issue more than 20% of our issued and outstanding ordinary shares or seek to amend our amended and restated memorandum and articles of association would require shareholder approval. We intend to conduct redemptions without a shareholder vote pursuant to the tender offer rules of the SEC unless shareholder approval is required by law or stock exchange listing requirement or we choose to seek shareholder approval for business or other legal reasons. So long as we obtain and maintain a listing for our securities on NASDAQ, we will be required to comply with such rules. If a shareholder vote is not required and we do not decide to hold a shareholder vote for business or other legal reasons, we will, pursuant to our amended and restated memorandum and articles of association: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase our ordinary shares in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering more than a specified number of public shares, which number will be based on the requirement that we may not redeem public shares in an amount that would cause our net tangible assets to be less than $5,000,001 upon consummation of our initial business combination, after payment of the deferred underwriting commission (so that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. If public shareholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination. 30 Table of Contents If, however, shareholder approval of the transaction is required by law or stock exchange listing requirement, or we decide to obtain shareholder approval for business or other legal reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and file proxy materials with the SEC. We expect that a final proxy statement would be mailed to public shareholders at least 10 days prior to the shareholder vote. However, we expect that a draft proxy statement would be made available to such shareholders well in advance of such time, providing additional notice of redemption if we conduct redemptions in conjunction with a proxy solicitation. Although we are not required to do so, we currently intend to comply with the substantive and procedural requirements of Regulation 14A in connection with any shareholder vote even if we are not able to maintain our NASDAQ listing or Exchange Act registration. If we seek shareholder approval, we will complete our initial business combination only if a majority of the issued and outstanding ordinary shares voted are voted in favor of the business combination. In such case, pursuant to the terms of a letter agreement entered into with us, our initial shareholders, officers and directors have agreed (and their permitted transferees will agree) to vote any founder shares held by them and any public shares purchased during or after this offering in favor of our initial business combination. We expect that at the time of any shareholder vote relating to our initial business combination, our initial shareholders and its permitted transferees will own at least 20% of our issued and outstanding ordinary shares entitled to vote thereon. If we submit our initial business combination to our public shareholders for a vote, our initial shareholders have agreed, pursuant to such letter agreement, to vote their founder shares, private placement shares and any public shares purchased during or after this offering in favor of our initial business combination (as a result, in addition to our initial shareholder s founder shares and private placement shares, we would need only 6,270,001, or 35.83%, of the 17,500,000 public shares sold in this offering to be voted in favor of a transaction (assuming all outstanding shares are voted and all shares to be issued to Maxim and/or its designees are issued and outstanding and voted in favor of the business combination) or 655,001, or 3.74%, of the 17,500,000 public shares sold in this offering to be voted in favor of a transaction (assuming only a quorum is present at such meeting held to vote on our initial business combination and all shares to be issued to Maxim and/or its designees are issued and outstanding and voted in favor of the business combination) in order to have our initial business combination approved (assuming the over-allotment option is not exercised)). Each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction. 31 Table of Contents Our amended and restated memorandum and articles of association will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 upon consummation of our initial business combination (so that we are not subject to the SEC s penny stock rules). Redemptions of our public shares may also be subject to a higher net tangible asset test or cash requirement pursuant to an agreement relating to our initial business combination. For example, the proposed business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration we would be required to pay for all ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all ordinary shares submitted for redemption will be returned to the holders thereof. Tendering share certificates in connection with a tender offer or redemption rights We may require our public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to either tender their certificates (if any) to our transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up to two business days prior to the vote on the proposal to approve our initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically using The Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option, rather than simply voting against the initial business combination. The tender offer or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public shareholders to satisfy such delivery requirements. Limitation on redemption rights of shareholders holding more than 15% of the shares sold in this offering if we hold shareholder vote Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering. We believe the restriction described above will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our sponsor or its affiliates to purchase their shares at a significant premium to the then-current market price or on other 32 Table of Contents undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us or our sponsor or its affiliates at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Our initial shareholders, officers and directors have, pursuant to a letter agreement entered into with us, waived their right to have any founder shares or public shares held by them redeemed in connection with our initial business combination. Unless any of our other affiliates acquires founder shares through a permitted transfer from an initial shareholder, and thereby becomes subject to the letter agreement, no such affiliate is subject to this waiver. However, to the extent any such affiliate acquires public shares in this offering or thereafter through open market purchases, it would be a public shareholder and subject to the 15% limitation in connection with any such redemption right. Redemption Rights in connection with proposed amendments to our amended and restated memorandum and articles of association Our amended and restated memorandum and articles of association will provide that any of its provisions, including those related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the private placement into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public shareholders as described herein and in our amended and restated memorandum and articles of association, but excluding the provision of the articles relating to the appointment of directors), may be amended if approved by a resolution by holders of at least two-thirds of the votes of shareholders who being so entitled attend and vote at the general meeting or by way of unanimous written resolution consented to by all directors, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of a majority of our ordinary shares. Should our initial shareholders vote all their shares in favor of any such amendment, such amendment would not be approved regardless how public shares are voted. We may not issue additional securities that can vote on amendments to our amended and restated memorandum and articles of association or in our initial business combination. Our initial shareholders, which will beneficially own 20% of our ordinary shares upon the closing of this offering (assuming it does not purchase units in this offering and excluding the private placement shares and the Representative s 33 Table of Contents shares), will participate in any vote to amend our amended and restated memorandum and articles of association and/or trust agreement and will have the discretion to vote in any manner it chooses. Our initial shareholders, officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association that would (i) modify the substance or timing of our obligation to redeem 100% of our public shares if we do not execute a definitive agreement for a business combination within 9 months (or 12 months if such period is extended) from the closing of this offering or if we do not complete our initial business combination within 15 months (or 18 months if such period is extended) provided we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering or (ii) with respect to the other provisions relating to shareholders rights or pre-business combination activity, unless we provide our public shareholders with the opportunity to redeem their ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then outstanding public shares. You will not be able to vote on or redeem your shares in connection with any such extension. Our initial shareholders, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares and public shares in connection with the completion of our initial business combination. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, all amounts held in the trust account will be released to us, other than funds the trustee will use to pay amounts due to any public shareholders who exercise their redemption rights as described above under Redemption rights for public shareholders upon completion of our initial business combination. We will use the remaining funds to pay the underwriters their deferred underwriting discounts, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. 34 Table of Contents Redemption of public shares and distribution and liquidation if no initial business combination Our sponsor, officers, and directors have agreed that we will have only 9 months from the closing of this offering (or 15 months from the closing of this offering if we have executed a definitive agreement for an initial business combination within 9 months from the closing of this offering, but have not completed the initial business combination within such 9-month period) to consummate our initial business combination, unless we elect to, extend the period of time to consummate an initial business combination by an additional three months to 12 months from the closing of this offering (or 18 months from the closing of this offering if we have executed a definitive agreement for an initial business combination within 12 months from the closing of this offering, but have not completed the initial business combination within such 12-month period). You will not be able to vote on or redeem your shares in connection with any such extension. If we are unable to execute a definitive agreement for a business combination within 9 months (or 12 months if such period is extended) from the closing of this offering or if we fail to complete our initial business combination within 15 months (or 18 months if such period is extended) provided we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable, and less up to $50,000 of interest to pay dissolution expenses) divided by the number of then outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our Board of Directors, liquidate and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our public warrants, public rights, private placement warrants or private placement rights. The warrants and rights will expire worthless if we fail to execute a definitive agreement for a business combination within 9 months (or 12 months if such period is extended) from the closing of this offering or if we fail to complete our initial business combination within 15 months (or 18 months if such period is extended) provided we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering. 35 Table of Contents Our initial shareholders, officers and directors have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to execute a definitive agreement for a business combination within 9 months (or 12 months if such period is extended) from the closing of this offering or if we fail to complete our initial business combination within 15 months (or 18 months if such period is extended) provided we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering. However, if our initial shareholders acquire public shares after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to execute a definitive agreement for a business combination within 9 months (or 12 months if such period is extended) from the closing of this offering or if we fail to complete our initial business combination within 15 months (or 18 months if such period is extended) provided we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering). The underwriters have agreed to waive their rights to their deferred underwriting commission held in the trust account in the event we do not execute a definitive agreement for a business combination within 9 months (or 12 months if such period is extended) from the closing of this offering or if we fail to complete our initial business combination within 15 months (or 18 months if such period is extended) provided we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering, and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. You will not be able to vote on or redeem your shares in connection with any such extension. Our sponsor, officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association that would (i) modify the substance or timing of our obligation to redeem 100% of our public shares if we do not execute a definitive agreement for a business combination within 9 months (or 12 months if such period is extended) from the closing of this offering or if we do not complete our initial business combination within 15 months (or 18 months if such period is extended) provided we execute a definitive business combination agreement within 9 months (or 12 months if extended) from the closing of this offering or (ii) with respect to the other provisions relating to shareholders rights or pre-business combination activity, unless we provide our public shareholders with the opportunity to redeem their ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then outstanding public shares. You will not be able to vote on or redeem your shares in connection with any such extension. However, we may not redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 upon consummation of our initial business combination (so that we are not subject to the SEC s penny stock rules). 36 Table of Contents Limited payments to insiders There will be no finder s fees, reimbursements or cash payments made to our sponsor, officers or directors, or our or their affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination, other than the following payments, none of which will be made from the proceeds of this offering and the sale of the private placement units held in the trust account prior to the completion of our initial business combination: payment to an affiliate of our CEO of a total of $10,000 per month for office space, utilities, secretarial and administrative support services, for a total of $90,000 if we consummate our initial business combination in 9 months (or $180,000 if we extend the time period and it takes 18 months to consummate a business combination),; reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; and repayment of working capital loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into units at a price of $10.00 per unit at the option of the lender. These payments may be funded using the net proceeds of this offering and the sale of the private placement units not held in the trust account or, upon completion of the initial business combination, from any amounts remaining from the proceeds of the trust account released to us in connection therewith. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliates. Audit committee Prior to the effectiveness of the registration statement of which this prospectus forms a part, we will have established and will maintain an audit committee (which will be composed entirely of independent directors), to among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled Management Committees of the Board of Directors Audit Committee. 37 Table of Contents Conflicts of interest Each of our officers and directors presently has, and in the future any of our directors and our officers may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present acquisition opportunities to such entity. Accordingly, subject to his or her fiduciary duties under Cayman Islands law, if any of our officers or directors becomes aware of an acquisition opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she will need to honor his or her fiduciary or contractual obligations to present such acquisition opportunity to such entity, and only present it to us if such entity rejects the opportunity. Our amended and restated memorandum and articles of association will provide that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and us, on the other. Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a vendor for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (i) $10.00 per public share or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third -party claims. We have not independently verified whether our sponsor has sufficient funds to satisfy their indemnity obligations and believe that our sponsor s only assets are securities of our company. We have not asked our sponsor to reserve for such obligations. Risks
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+S-1/A 1 tm225054-11_s1a.htm S-1/A As filed with the U.S. Securities and Exchange Commission on February 11, 2022. Registration No. 333-258184 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form S-1/A (Amendment No. 8) REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 A SPAC I Acquisition Corp. (Exact name of registrant as specified in its charter) British Virgin Islands 6770 N/A (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) Level 39, Marina Bay Financial Centre Tower 2 10 Marina Boulevard, Singapore 018983 Telephone: (65) 6818 5796 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Level 39, Marina Bay Financial Centre Tower 2 10 Marina Boulevard, Singapore 018983 Telephone: (65) 6818 5796 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Giovanni Caruso Loeb & Loeb LLP 345 Park Avenue New York, NY 10154 Telephone: (212) 407-4000 Lou Taubman, Esq, Guillaume de Sampigny. Esq. Hunter Taubman Fischer & Li LLC 48 Wall Street, Suite 1100 New York, NY, 10005 Telephone: (212) 530-2210 Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company, and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED FEBRUARY 11, 2022 PRELIMINARY PROSPECTUS $60,000,000 A SPAC I Acquisition Corp. 6,000,000 Units A SPAC I Acquisition Corp. is a newly incorporated blank check company incorporated in the British Virgin Islands as a BVI business company for the purpose of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. Although there is no restriction or limitation on what industry or geographic region our target operates in, it is our intention to pursue prospective targets that are based in the United States and /or Asia (excluding China) with a focus in the technology, media and telecom (TMT) sector. We shall not undertake our initial business combination with any entity with its principal business operations in China (including Hong Kong and Macau). We will primarily seek to acquire one or more growth businesses with a total enterprise value of between $250 million and $600 million. At the time of preparing this prospectus, we do not have any specific business combination under consideration or contemplation, and we have not, nor has anyone on our behalf, contacted any prospective target business or had any discussions, formal or otherwise, with respect to such a transaction. Our efforts to date are limited to organizational activities related to this offering. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one of our Class A ordinary shares, three-fourths (3/4) of one redeemable warrant and one right as described in more detail in this prospectus. Each right entitles the holder thereof to receive one-tenth (1/10) of one Class A ordinary share upon consummation of our initial business combination. No fractional warrants or rights will be issued upon separation of the units and only whole warrants and whole rights will trade. We will not issue fractional shares in connection with the exercise of warrants or exchange of rights. As a result, (i) you must hold whole rights in multiples of 10 in order to receive shares for all of your rights upon closing of a business combination, and (ii) you must exercise warrants in multiples of four warrants, at a price of $11.50 per full share, subject to adjustment as described in this prospectus, to validly exercise your warrants. We have also granted the underwriters a 45-day option to purchase up to 900,000 additional units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below as of two business days prior to the consummation of our initial business combination, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding Class A ordinary shares that were sold as part of the units in this offering, which we refer to collectively as our public shares, subject to the limitations and on the conditions described herein. If we are unable to complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time, as described in more detail in this prospectus), we will redeem 100% of the public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (less up to $50,000 of interest to pay dissolution expenses and which interest shall be net of taxes payable) divided by the number of then outstanding public shares, subject to applicable law and as further described herein. Our sponsor or its affiliates or designees, upon ten days advance notice prior to the applicable deadline, may, but are not required to, extend the time to complete a business combination by depositing into the trust account $600,000, or up to $690,000 if the underwriter s over-allotment option is exercised in full ($0.10 per share in either case) on or prior to the date of the applicable deadline, for each three month extension (or up to an aggregate of $1,200,000 (or $1,380,000 if the underwriter s over-allotment option is exercised in full), or $0.20 per share if we extend for the full six months). You will not be able to vote on or redeem your shares in connection with any such extension. Our sponsor, A SPAC (Holdings) Acquisition Corp., a BVI business company, has agreed to purchase an aggregate of 2,875,000 warrants (or 3,145,000 warrants if the over-allotment option is exercised in full) at a price of $1.00 per warrant for an aggregate purchase price of $2,875,000 (or $3,145,000 if the over-allotment option is exercised in full). Each private placement warrant will be identical to the warrants sold in this offering, except as described in this prospectus. The private placement warrants will be sold in a private placement that will close simultaneously with the closing of this offering, including the over-allotment option, as applicable. We refer to these warrants throughout this prospectus as private placement warrants. Prior to this offering, our sponsor held 1,725,000 Class A ordinary shares (up to 225,000 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised) and one Class B ordinary share. The Class B ordinary share will automatically be canceled at the time of our initial business combination. The holder of our Class B ordinary share will have the right to elect all of our directors prior to our initial business combination and the holders of our Class A ordinary shares will not be entitled to vote on the election of directors during such time. Prior to this offering, there has been no public market for our units, Class A ordinary shares, warrants or rights. We have applied to list our units on the NASDAQ Capital Market, or NASDAQ, under the symbol "ASCAU" on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on NASDAQ. The Class A ordinary shares, warrants and rights comprising the units will begin separate trading on the 90th day following the date of this prospectus unless Chardan Capital Markets, LLC, or Chardan, the representative of the underwriters of this offering, informs us of its decision to allow earlier separate trading, subject to our filing a Current Report on Form 8-K with the Securities and Exchange Commission, or the SEC, containing an audited balance sheet reflecting our receipt of the gross proceeds of this offering. Once the securities comprising the units begin separate trading, we expect that the Class A ordinary shares, warrants and rights will be listed on NASDAQ under the symbols "ASCA", "ASCAW" and "ASCAR," respectively. We have not authorized anyone to provide any information or to make any representations other than those contained in this prospectus. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the units offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date. We are an emerging growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves risks. See Risk Factors on page 40. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Price to Public Underwriting Discounts(1) Proceeds, before expenses, to us Per Unit $ 10.00 $ 0.55 $ 9.45 Total $ 60,000,000 $ 3,3000,000 $ 56,700,000 (1) Includes $2,100,000, or $0.35 per unit, equal to 3.5% of the gross proceeds of this offering (or $2,415,000 if the underwriters over-allotment option is exercised in full) payable to the underwriters as deferred underwriting discounts from the funds to be placed in the trust account described in this prospectus. The deferred underwriting discounts will be released to the underwriters upon consummation of an initial business combination, as described in this prospectus. If the business combination is not consummated, the underwriters will not be entitled to any interest accrued on the deferred underwriting discounts. See also "Underwriting" for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $60,600,000 or $69,690,000 if the underwriters over-allotment option is exercised in full ($10.10 per unit), will be deposited into a trust account located in the United States with Continental Stock Transfer & Trust Company acting as trustee. Such amount includes $2,100,000, or $0.35 per unit (or $2,415,000 if the underwriters over-allotment option is exercised in full), payable to the underwriters as deferred underwriting discounts. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. The underwriters are offering the units for sale on a firm commitment basis. Delivery of the units will be made on or about [ ], 2022. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. No offer or invitation to subscribe for units may be made to the public in the British Virgin Islands. Sole Book-Running Manager Chardan The date of this prospectus is [ ], 2022. TABLE OF CONTENTS Page SUMMARY 1
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+summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under "Risk Factors" starting on page 34 and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: "amended and restated certificate of incorporation" are to our second amended and restated certificate of incorporation to be in effect upon completion of this offering; the "board" refers to the Board of Directors of First Digital Health Acquisition Corp.; "DGCL" refers to the Delaware General Corporation Law as the same may be amended from time to time; "directors" are to our current directors and any director nominees named in this prospectus; "founder shares" are to our shares of Class B common stock initially purchased by our sponsor in a private placement prior to this offering and our shares of Class A common stock that will be issued upon conversion thereof as provided herein; "initial stockholders" are to our sponsor and the other holders of our founder shares prior to this offering; "letter agreement" refer to the letter agreement, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; "management" or our "management team" are to our directors and officers; "common stock" are to our shares of Class A common stock and our shares of Class B common stock; "private placement warrants" are to the warrants issued to our sponsor and other holders, as applicable, in a private placement simultaneously with the closing of this offering and upon conversion of working capital loans or extension loans, if any; "public stockholders" are to the holders of our public shares, including our sponsor, directors and officers to the extent our sponsor, directors or officers purchase public shares, provided their status as a "public stockholder" shall only exist with respect to such public shares; "public shares" are to our shares of Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); "sponsor" are to First Digital Health Sponsor, LLC, a Delaware limited liability company; "warrants" are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); "we," "us," "our" or our "company" are to First Digital Health Acquisition Corp., a Delaware corporation; and "$," "US$" and "U.S. dollar" each refer to the United States dollar. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option and assumes the forfeiture of an aggregate of 656,250 founder shares. 1 General Our Company We are a newly organized blank check company incorporated on March 24, 2021 as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any specific business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. While we may pursue an acquisition opportunity in any business industry or sector, we intend to capitalize on our management team s differentiated ability to source, acquire, and manage a business in the healthcare industry, specifically in the healthcare technology, healthcare technology-enabled services, or digital health subsectors. We believe these subsectors present significant opportunities tied to emerging themes, including value-based care, population health, social determinants of health, consumer engagement and empowerment, care coordination, access enhancement and real-world evidence utilization in life sciences. Our management team and advisors have extensive track records of creating value for stockholders by identifying, investing into and acquiring businesses in these sectors and subsectors tied to many of these themes. Our management team and advisors have demonstrated expertise in growth investing while driving operational excellence and financial discipline to create sustained and growing stockholder value. We are also supported by our sponsor. Members of our sponsor include First Trust Capital Partners and Martin Ventures. First Trust Capital Partners, LLC ("FTCP") is a private investment firm focused primarily on healthcare and financial services investments. FTCP has made over 60 private market investments in multiple sectors with a substantial focus on investing in and supporting healthcare information technology, healthcare technology-enabled services and healthcare services businesses that are influencing and capitalizing on emerging trends in the healthcare field. FTCP and its affiliates have made 38 investments in healthcare technology and services companies and have fully exited nine of those investments. Martin Ventures, LLC ("Martin Ventures") is a Nashville-based investment firm focused on building and investing in healthcare technology, healthcare services and healthcare companies, particularly in healthcare information technology and healthcare technology enabled services. Martin Ventures currently has a portfolio of 20 private healthcare investments. FTCP and Martin Ventures, along with our management team and our advisors, provide significant domain knowledge and expertise, and we believe they will deliver insightful strategic perspectives, extensive access to acquisition targets and resources to aid in the identification, diligence, and negotiations associated with our initial business combination. In addition, we anticipate that our sponsor will provide meaningful incremental financial discipline, operational support, and governance after our initial business combination. Our Management Team Our management team is led by Charles N. Martin, our Chairman, Justin Dearborn, our Co-Chief Executive Officer, and Jonathan Phillips, our Co-Chief Executive Officer. Charles N. Martin, Chairman Charles Martin, our Chairman, is the founder and Chairman of Martin Ventures, a Nashville-based investment firm he founded in 2009. Mr. Martin has more than 50 years of experience operating large, complex healthcare systems. At Martin Ventures, he leads an investment firm dedicated to building and investing in healthcare technology, healthcare services and healthcare technology-enabled services companies that optimize existing healthcare provider businesses, develop new and innovative models of care, and empower the healthcare consumer. Martin Ventures has a current portfolio of 20 healthcare companies and has successfully exited an additional 13 healthcare investments. Prior to launching Martin Ventures, Mr. Martin founded Vanguard Health Systems and served as Vanguard s Founder, Chairman, and Chief Executive Officer for 16 years. Vanguard went public in 2011, and in 2013 was acquired by Tenet Healthcare for $4.3 billion. Before launching Vanguard, Mr. Martin, in conjunction with private equity partners, acquired the hospital chain Republic Health, ultimately founding a new healthcare system called OrNda Healthcare Corp. OrNda became the nation s third-largest investor-owned hospital chain with 53 hospitals before being sold to Tenet Healthcare Corp. in 1997 for $1.8 billion. Earlier in Mr. Martin s career, he served in numerous executive roles with Hospital Corporation of America, Inc., General Care Corp. and HealthTrust Inc. 2 Mr. Martin has also served on numerous boards of directors, including the University of Pennsylvania Law School and RAND Health, an independent health research group. Mr. Martin received his B.A. from Southern Adventist University. Justin Dearborn, Co-Chief Executive Officer and Director Justin Dearborn, our Co-Chief Executive Officer and a director, has over 25 years of experience leading healthcare, technology and publishing businesses, and is currently serving as the Chief Executive Officer of PatientBond, Inc., a digital patient engagement company powered by healthcare consumer psychographics. Before his role as Chief Executive Officer of PatientBond, Mr. Dearborn served as Chief Executive Officer of Tribune Publishing Company (Nasdaq: TPCO), a media company, from 2016 to 2019 and as Chief Executive Officer and Chairman from 2018 to 2019. Mr. Dearborn was chief executive officer of eMed, an at-home diagnostic testing company, in 2020. Mr. Dearborn was Chief Operating Officer for ICM Partners, a leading talent agency, in 2019. Prior to Tribune, he served as Chief Executive Officer and a director of Merge Healthcare Incorporated (Nasdaq: MRGE), a clinical software solution provider from 2008 until 2016. During his tenure, Mr. Dearborn led the company through a period of transformation and sustainable growth. While serving as Chief Executive Officer of Merge, he executed a multi-faceted growth strategy comprised of significant investments in sales and marketing capabilities across Merge s core solution offerings while pursuing acquisitions to broaden market reach into adjacent sectors and to increase capabilities and share of current solution offerings. Mr. Dearborn joined Merge as Chief Executive Officer when Merge s enterprise value was approximately $10 million. Merge was acquired by IBM for $1 billion in 2015 and was integrated into IBM s Watson Health division to deliver intuitive, cognitive computing solutions to healthcare providers. Over his career, Mr. Dearborn has led the acquisition of numerous companies, including the sales of Merge and the LA Times. Before joining Merge, Mr. Dearborn served as managing director at Merrick Ventures, LLC, a private investment firm. In addition to serving on the board of directors of PatientBond, Mr. Dearborn is serving out his final term as a director and Chairman of the Audit Committee, of Next Level Health, an Illinois based Medicaid insurance provider that was acquired by Centene Corporation in 2020. Mr. Dearborn received his B.S. in Accounting from Illinois State University and his J.D. from Depaul College of Law. Jonathan R. Phillips, Co-Chief Executive Officer and Director Jonathan Phillips, our Co-Chief Executive Officer and a director, has over 25 years of experience in healthcare information technology, healthcare services, investment banking and private investing. Mr. Phillips has served as Managing Director and Head of Private Equity for FTCP, headquartered in Wheaton, Illinois, since November 2016. Mr. Phillips is also the founder and Managing Partner of First Health Capital Partners, LLC, a healthcare technology and services investment firm founded in January 2016. Mr. Phillips has led investments in a broad range of healthcare technology and services companies, including Vivify Health (acquired by United Health Group in 2019), Lightbeam Health, AVIA, RxAnte, and Wellvana Health. Before his role at First Trust Capital Partners, in 2005, Mr. Phillips founded Healthcare Growth Partners, LLC, a provider of strategic and financial advisory services to healthcare technology companies, and he served as its Managing Director until November 2016. Prior to founding Healthcare Growth Partners, Mr. Phillips was a member of the Healthcare Investment Banking Group at William Blair, an investment banking firm. Prior to William Blair, he served in various roles in the healthcare practice of Deloitte Consulting. Mr. Phillips currently serves as a director and as the Audit Committee chair for Streamline Health (Nasdaq: STRM), a publicly traded healthcare information technology company. In addition, Mr. Phillips serves on the boards of a number of private companies including AVIA, Conversio Health, Cordata Healthcare Innovations, Lightbeam Health, PatientBond, RxAnte, Wellbox and Wellvana. Mr. Phillips has completed over 115 transactions involving healthcare companies and has completed over 40 strategic advisory engagements for healthcare technology and services companies. Mr. Phillips earned his MBA in Finance, Marketing and Health Services Management from the J. L. Kellogg School of Management, Northwestern University, and his BA in Economics and Management from DePauw University. 3 Our Non-Executive Director Nominees Matthew Etheridge, Director Nominee Matthew Etheridge is a private investor with over 20 years of investment management experience, with a primary focus on healthcare services and information technology. He has invested in and served on the board of directors of several public and private companies in these areas, including NaviHealth (acquired by Cardinal Health in 2018) Universal American Corp. (NYSE: UAM; acquired by Wellcare in 2017), Lightbeam Health Solutions, Healthmine and Conversio Health. Previously, Mr. Etheridge was a Managing Partner of Perry Capital LLC, a private investment management firm, where he was Co-Portfolio Manager of the firm s healthcare group, which managed public and private investments in healthcare and other industries. Prior to joining Perry Capital in 2001, Mr. Etheridge was an investment analyst for Stanford Management Company, the investment manager of Stanford University s endowment. Prior to joining Stanford Management in 1997, Mr. Etheridge was a consultant with McKinsey & Company. Mr. Etheridge received his J.D. from Stanford Law School and his A.B. in Economics from Stanford University. Jeremy Friese, M.D., Director Nominee Jeremy Friese, M.D., is a physician executive with a demonstrated passion for improving healthcare, first as an academic physician leader at Mayo Clinic then as an entrepreneur with various healthcare companies. Dr. Friese currently serves as President, Payer Market at Olive, a developer of process automation software designed to build meaningful artificial intelligence for healthcare payers and providers. Prior to Olive, Dr. Friese ran Invenshure, a healthcare venture incubator, and co-founded and led Verata Health, a venture-backed AI technology company that pioneered Frictionless Prior Authorization for payers and providers, and which was acquired by Olive in 2020. Prior to his transition to entrepreneurship, Dr. Friese was a physician and executive at the Mayo Clinic and Harvard University. During his Mayo career, he held executive leadership positions for the imaging service line, the Mayo Clinic Strategic Investment Fund, and Global Business Development. Additionally, Dr. Friese served on several boards of directors, including the International Monetary Fund and the American Cancer Society. Dr. Friese earned his MD at the Mayo Clinic College of Medicine and Science and his MBA at Harvard Business School. Kelly Richmond Pope, Ph.D., Director Nominee Kelly Richmond Pope, Ph.D., is a professor in the School of Accountancy and Management Information Systems at DePaul University. Prior to joining DePaul, she worked in the forensic accounting practice at KPMG, LLP on anti-money laundering engagements, insurance fraud investigations and fraud risk management projects. She was named as one of the 25 most powerful women in accounting by the American Institute of Certified Public Accountants (the "AICPA") and CPA Practice Advisor. She currently serves as director and chair of the Audit Committee for the Greater Chicago Food Depository. She is former director and finance chair for Mercy Hospital & Medical Center, former director of the Illinois CPA Society and former member of the governing council for the AICPA. She received her doctorate in accounting from Virginia Tech, and she is a licensed certified public accountant. John Glaser Ph.D., Director Nominee John Glaser, Ph.D., is a former senior vice president of Population Health at Cerner Corporation from 2015 to 2019. Prior to such time, he was Chief Executive Officer of Siemens Heath Services from 2010 to 2015. Prior to Siemens, Dr. Glaser was Chief Information Officer at Partners HealthCare. He was the founding chair of the College of Healthcare Information Management Executives ("CHIME") and the past-president of the Healthcare Information and Management Systems Society. He is the former Chair of the Global Agenda Council on Digital Health, World Economic Forum. He is former Senior Advisor to the Office of the National Coordinator for Health Information Technology. Dr. Glaser serves on the boards of directors of the Scottsdale Institute, Intouch Health, PatientPing, National Committee for Quality Assurance, the American Telemedicine Association, Wellsheet and Relatient. Dr. Glaser has received numerous industry awards, including the John P. Glaser Innovation Award (established by the School of Biomedical Informatics, UTHealth), William B. Stead Thought Leadership Award (American Medical Informatics Association) and the Lifetime Achievement Award (CHIME). He has authored many articles and books on the strategic application of IT in health care. He is on the faculty of the Wharton School at the University of Pennsylvania, the UTHealth School of Biomedical Informatics and the Harvard School of Public Health. 4 Anthony Sanzo, Director Nominee Anthony Sanzo has been a healthcare and healthcare information technology executive for over 20 years and brings a deep understanding of the operational challenges faced by healthcare providers and the ways that technology solutions can be deployed to address them. Mr. Sanzo currently serves as Chairman of the Board of Net Health Systems, a specialized electronic health record software and services vendor providing technology solutions that address the continuum of care from hospital to home. Prior to his role as Chairman, Mr. Sanzo was the Chief Executive Officer of Net Health from 2012 until 2019. Over the course of his tenure, Net Health grew from a single product startup to a multi-product, multimarket, healthcare information technology company. Prior to joining Net Health, Mr. Sanzo served as the Chief Executive Officer for TeleTracking Technologies, a company he joined in late 2001. During his tenure, the company evolved from a workflow automation startup focusing on hospital support services to the world market and innovation leader in patient flow automation, capacity management and related operations improvements. With more than 800 clients in three countries, TeleTracking grew to become the largest vendor in its market. Prior to TeleTracking, Mr. Sanzo held executive positions for two major academic medical centers and served as the Chief Executive Officer for Allegheny General Hospital for nearly a decade. Mr. Sanzo has been a board member of multiple companies and is a graduate of Allegheny College and Duke University s Fuqua School of Business. Advisory Board Michael Connolly Mike Connolly has over 30 years of experience enabling significant performance improvements and driving large scale transformations in healthcare and consulting businesses. Mr. Connolly currently leads PwC s Transformation Consulting business line. He has P&L responsibility for a revenue business that provides advisory services in areas including strategy, customer success, operations, mergers and acquisitions, finance, workforce management and clinical consulting across various sectors, including healthcare. Prior to his current role, Mr. Connolly served as the leader of PwC s Health Advisory businesses. Before re-joining PwC in 2019, Mr. Connolly was president of Ciox Health where he was responsible for developing its clinical data exchange and the related AI driven technology platform from 2017 to 2019. He also created a transformation program to integrate multiple acquisitions and improve operating and financial performance. Prior to joining Ciox, Mr. Connolly was a senior partner at PwC, driving PwC s Platform businesses where he focused on standing up large transformation businesses across PwC. Before joining PwC, Mr. Connolly worked at Booz & Co. as Global Managing Director of Platforms and Functional Practices, Leader of the Global Technology Practice and served as a member of the board of directors and Executive Committee. Prior to joining Booz & Co., Mr. Connolly served as the Chief Technology Officer of Aetna from 2004 to 2006 and the President of Diamond Technology Partners from 1995 to 2005. Mr. Connolly served on the board of directors of Signify Health from 2018 to 2019. Mr. Connolly holds an M.B.A. in management information systems from Northern Illinois University. Mr. Connolly also attended Indiana University, where he received a B.S. degree in Finance with High Distinction and was admitted to the Beta Gamma Sigma Honor Society. Steven Tolle Steven Tolle is a partner with HLM Venture Partners. He brings 30 years of commercial healthcare technology expertise in the areas of strategy, business development, and product management. Mr. Tolle has spent his career helping to develop and manage important themes in healthcare innovation and investment including artificial intelligence, diagnostic imaging/medical devices, electronic health records, population health, managed care and value-based pharmaceutical pricing. He currently sits on the boards of LetsGetChecked and PatientPop and is a board observer at VaxCare, Nordic Consulting and mPulse Mobile. Prior to joining HLM, he served as Chief Strategy Officer at Merge Healthcare, which was acquired by IBM in 2015. After his significant involvement in the transaction, Mr. Tolle was named Vice President of Global Strategy & Business Development at Watson Health Imaging. Prior to joining Merge, Mr. Tolle also served as Senior Vice President/General Manager at Optum from 2009 to 2011, Vice President of Product Management at Allscripts from 2007 to 2009, and Director of Product Management at Pfizer from 1996 to 2007. 5 Wyche T. Green III Mr. Wyche "Tee" Green III is the Chief Executive Officer of 121G, LLC, an investment, business advisory and technology development firm he founded in 2013 where he helps start-up and growth stage company executives lead with purpose, accelerate revenue and intelligently scale operations. In addition, Mr. Green is the CEO and Chairman of the Board of Streamline Health Inc. (Nasdaq: STRM) and is a member of the boards of directors of several technology and healthcare companies, including Pelitas Inc., Elligo Health Research Inc., Sonic Tools USA, Caravan Health, ReferralPoint, Wellbox Inc., GreenCourt and Clearview Installations. Mr. Green is the former Executive Chairman and Chief Executive Officer of Greenway Health, where he served in leadership roles since its founding as Greenway Medical Technologies in 1998. Under Mr. Green s leadership as Chief Executive Officer, Greenway Health grew to $136 million at the time of its acquisition by Vitera Healthcare. In 2013, Mr. Green led Greenway Health through a go-private transaction with Vista Equity Partners where Greenway Health merged with Vitera Healthcare in a deal that valued Greenway Health at approximately $644 million. Patrick B. Cline Patrick Cline currently serves as Chief Executive Officer of Lightbeam Health Solutions, Inc., a leader in population health management technology. Prior to Lightbeam, Mr. Cline founded and operated NextGen Healthcare (Nasdaq: NXGN, formerly known as Clinitec International, Inc.), an electronic health record and practice management IT company. Prior to NextGen, Mr. Cline was a software developer. Today, Mr. Cline is a respected strategist and highly experienced operator. He sits on multiple boards and coaches other executives in the areas of leadership, communication, teamwork and goal achievement. We believe the reputation and expertise of our management team and advisors in the healthcare industry will make us a desirable partner for potential business combination targets. Healthcare Industry Attractiveness The healthcare sector is large and rapidly growing, and our management team will use its deep knowledge of the sector and market participants to efficiently pursue attractive acquisition opportunities that utilize technology to address long-term, structural challenges in the industry. In 2018, U.S. healthcare expenditures amounted to $3.6 trillion, or 17.7% of total GDP, according to the Centers for Medicare & Medicaid Services ("CMS"). CMS projects U.S. healthcare expenditures will rise to $6.2 trillion through 2028, or 19.7% of GDP, representing a 5.4% compound annual growth rate, meaningfully outpacing projected U.S. GDP growth over the projection period. Absent innovation, the current trajectory of rising healthcare costs will likely result in reduced competitiveness for the broader U.S. economy over time as the healthcare delivery and payment ecosystem consumes ever increasing resources. We believe the healthcare industry needs to continue to pursue initiatives to generate meaningful productivity improvements aiming to reduce cost and improve care outcomes while also increasing consumer access and improving the consumer experience. We believe information technology and technology-enabled services companies will be critical components of any fundamental changes to healthcare delivery and payment. The ongoing growth of healthcare spending has significantly pressured all industry participants (including consumers, employers, insurers, providers, life sciences companies, and government agencies) to manage costs while simultaneously maintaining or increasing access and improving health outcomes. Many constituents in the healthcare system are pursuing new and innovative technologies and business models aimed at improving the quality of outcomes for individuals, reducing friction in the consumer health journey, and delivering enhanced care at a lower cost. We intend to focus our acquisition efforts across certain emerging themes in the healthcare market. We believe there is a large and attractive addressable market of potential business combination targets addressing these themes and intend to concentrate on target companies with developed strategies, established customer bases, differentiated solutions and attractive growth prospects with enterprise values of up to $1.5 billion. The breadth of the thematic opportunities and diversity of the target universe across multiple compelling subsectors maximize the likelihood that our management team will be able to identify and execute an attractive transaction with the aim to generate substantial stockholder value over time. 6 Our belief that a large addressable market of potential acquisition targets exists is based on our knowledge of the healthcare information technology and technology-enabled healthcare services markets, and, in part, due to the scale of the industry as well as the innovation and technology-enablement currently underway. Many potential targets are held by private equity or venture capital investors with finite investment horizons who will eventually seek to exit their positions. Recent private funding by venture capital and private equity firms has been significant: according to Pitchbook, there was approximately $117 billion of funding into U.S. healthcare companies in 2020, up from approximately $58 billion in 2016. Recently, public market interest has been strong for healthcare technology and tech-enabled healthcare services assets, representing approximately 25% of capital raised in healthcare IPOs since 2018 with higher growth in number of IPOs relative to other healthcare subsectors over the same time period, according to Dealogic. In light of the recent, robust public and private healthcare market activity, we believe that there are still a large number of potential business combination targets with financial and operating characteristics that will be attractive to public equity investors. Based on our current knowledge and data from Pitchbook, we believe that there are more than 2,000 healthcare information technology or technology-enabled healthcare services companies in the United States, and of such companies, we believe there are more than 500 of appropriate size and scale to be ready for public markets either on their own or combined with another company or companies Competitive Strengths Our mission is to create attractive risk-adjusted returns for our stockholders. We intend to acquire a platform company to build a category leader in healthcare technology or technology-enabled healthcare services with a durable long-term growth opportunity driven by macro-market trends and specific competitive advantage. We intend to capitalize on the ability of our management team and advisory board to identify, evaluate, acquire, and operate a business or businesses that will benefit from our team s differentiated collective experience and capabilities: Industry Knowledge: Healthcare is a broad, diverse, and local industry comprised of numerous sectors that each require unique institutional knowledge to be properly analyzed. Our management team, advisors, and sponsor can draw on vast experience to drive value creation for stockholders. Our team has expertise in virtually all subsectors of healthcare information technology, healthcare technology-enabled services and healthcare services including provider, payer, life sciences, consumer and employer solutions. In addition, we have significant experience in emerging areas of healthcare, including value-based care, population risk, population health, care coordination, condition management, virtual care, consumer engagement and pharmaceutical development. Investment Experience: Our management team and sponsor have evaluated thousands of, and invested in hundreds of, public and private companies. We have extensive experience assessing management teams, growth plans, strategic roadmaps, competitive differentiation, operational capabilities, technology infrastructures, and financial and accounting diligence materials. We believe that we can effectively and efficiently review large numbers of potential targets with a discerning view of valuation and expected risk-adjusted returns to determine whether the target(s) will be an appropriate candidate(s) for a potential business combination. Management Expertise: Our management team, directors and sponsor have decades of diverse experience operating healthcare businesses and driving value creation. The team has successfully led businesses in various stages of their lifecycle, which should allow for a target to receive expert advice from a deep bench of industry experts and contacts. Our team has experience in all facets of growth and operations including deep knowledge of industry best practices across critical functional areas including marketing, sales, operations, business development, product strategy, product development, implementation, risk management and compliance, customer success, and finance and accounting. Moreover, our team s expertise will be an invaluable resource for management teams to lean on as they continue to operate in a highly regulated and complex marketplace. Sourcing: Our management team, directors and advisors have an extensive network of relationships with private and public companies, investment bankers, attorneys, accountants, private and public equity investors, industry executives, and advisors that we believe will provide proprietary deal-sourcing opportunities. Our management team, directors and advisors have grown their network by investing in, acquiring and growing businesses, while developing a reputation for integrity and fair dealing with all constituents. This network has provided our management team and sponsor group with a flow of referrals from strategic investors, financial investors, payers, and providers that has resulted in numerous proprietary transactions and participation in transaction processes in which a limited group of investors were invited into the financing and sale processes. We believe that both active outreach and our network of 7 contacts and relationships will provide us important sources of investment opportunities and a highly differentiated pipeline of targets. In addition, our management team, directors and advisors have executed transactions under varying economic and financial market conditions and have successfully navigated through numerous changes to healthcare policy and practice. Transaction Execution: Our management team and sponsor have collectively executed or advised on hundreds of investment, merger and acquisition, private placement, and public offering transactions during their careers. We believe that this experience will allow for flexible structuring solutions that create proper alignment between management and stockholders, as well as efficient negotiations and pricing. Capital Markets Expertise: Our management team is well-versed in capital markets activities, having advised many companies on capital markets transactions and having run multiple large and complex publicly-traded companies. This experience should allow our team to effectively position a target company with public-market investors. Additionally, the expertise of our management team in pursuing and consummating add-on acquisitions utilizing the flexibility of public-company capital structures is substantial. Governance Experience: Our management team and directors have extensive experience with board and governance matters through their roles as directors of public and private companies. Our officers and directors have served as board chairs as well as board committee chairs including Audit, Compensation, Strategy and Nominating and Governance Committees. Long-Term Perspective: Our management team is comprised of seasoned veterans from the healthcare information technology and services markets. As a result, our team understands that building great businesses can take time. We are focused on pursuing long-term value creation upon the consummation of a business combination. Acquisition Criteria Consistent with our strategy, we have identified the following general criteria and guidelines that are important in evaluating prospective target businesses. We will use this framework to evaluate acquisition opportunities, but we may decide to enter into our initial business combination with a target that does not meet all of these criteria and guidelines. We intend to target potential acquisitions that support one or more emerging sector themes including: Transitioning to value-based care and reimbursement and the impact of that transition across the healthcare ecosystem, including evolution in contracting and reimbursement for providers, pharma/biotech and medical device companies. Continuing consumerization of healthcare and the importance of meaningful patient/member/employee engagement. Focusing on population health initiatives to drive sustainable improvement in health outcomes. Tracking, assessing, and impacting social determinants of health. Empowering the consumer around health decisions, including prevention, diagnosis and treatment. Broadening access to care through virtual care, multi-modal outreach, and hybrid or new care delivery models. Collecting, accessing and analyzing large data sets to drive insights into behavior and outcomes utilizing data visualization and artificial intelligence. Using real world evidence across the drug development value chain. Improving healthcare provider and payer oversight with respect to governance, risk management, cyber-security, and compliance. Improving healthcare information technology infrastructure including the lack of healthcare data fluidity, increased demand for interoperability, and general productivity improvement. 8 Improving coordination and management of care across multiple provider types and risk-bearing entities including addressing transitions of care along with institutional and home-based post-acute and chronic care. Improving the efficiency of healthcare staffing and labor access to address labor shortages and workforce management challenges. Our evaluation of potential acquisitions will include customary strategic, operational and financial reviews of the targets in tandem with the engagement of third-party advisors where appropriate. We intend to filter opportunities based on the following criteria: Growth Potential: multiple expansion vectors across organic opportunities and / or compelling acquisition opportunities. Sector Attractiveness: attractive macro-sector fundamentals and outlook with limited business model exposure to reimbursement and/or policy risk. Value Proposition: compelling value proposition to stakeholders within the healthcare ecosystem. Business Model/Stage: profitable business model or demonstrable ability to achieve profitability at scale where additional managerial, commercial, strategic and/or operational expertise will accelerate the pathway to profitability while maintaining a favorable growth trajectory. Competitive Position: leading or growing market share relative to peer group. Unrecognized Value: identifiable value-creation opportunities that can be unlocked leveraging the extensive operational and strategic knowledge and experience of our team. Public Market Readiness: strong management, corporate governance, and financial forecasting and reporting functions in place that will establish credibility with public investors and facilitate continued access to public capital markets. Valuation discipline: attractive risk-adjusted returns to our stockholders based on the fundamental business and the financial characteristics of the potential target. These criteria are not intended to be exhaustive. Any evaluation of a particular initial business combination may be based on these general guidelines as well as other considerations, factors, and criteria that our management team may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our stockholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation materials or tender offer documents that we would file with the U.S. Securities and Exchange Commission. We may need to obtain additional financing either to complete our initial business combination or because we become obligated to redeem a significant number of our public shares upon completion of our initial business combination. We intend to acquire a company or companies that, when aggregated, will have an enterprise value above the net proceeds of this offering and the sale of the placement units. Depending on the size of the transaction or the number of public shares we become obligated to redeem, we may potentially utilize several additional financing sources, including but not limited to the issuance of additional securities to the sellers of a target business, debt issued by banks or other lenders, a private placement, or a combination of the foregoing. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the trust account. In addition, following our initial business combination, if cash on hand is insufficient to meet our obligations or our working capital needs, we may need to obtain additional financing. Ability to Extend Time to Complete Business Combination If we anticipate that we may not be able to consummate our initial business combination within 15 months from the consummation of this offering, we may, but are not obligated to, if requested by our sponsor or its affiliates, extend the period of time to consummate a business combination up to two times by an additional three months (each, a "Paid Extension") for a total of 21 months (the "Paid Extension Period"). 9 In the case of the Paid Extension Period, public stockholders will not be offered the opportunity at the time of the extension to vote on or redeem their shares if we choose to make any such Paid Extension. As a result, we may conduct such an extension even though a majority of our public stockholders do not support such an extension and will not be able to redeem their shares in connection therewith. Pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order to avail ourselves of the Paid Extension Period to consummate our initial business combination, our sponsor or its affiliates or designees, upon five days advance notice prior to the initial business combination deadline, must deposit into the trust account an amount per Paid Extension of $1,750,000, or $2,012,500 if the underwriters over-allotment option is exercised in full ($0.10 per share in either case), on or prior to the date of the initial business combination deadline. Any such payments would be made in the form of a loan, which will be non-interest bearing and payable upon the consummation of our initial business combination. If we complete our initial business combination, we would repay such loaned amounts out of the proceeds of the trust account released to us or, at the option of the lender, convert such loaned amounts into private placement warrants of the post business combination entity at a price of $1.00 per warrant. In the event that we receive notice from our sponsor or its affiliates five days prior to the initial business combination deadline of its wish for us to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the initial business combination deadline announcing whether or not the funds had been timely deposited. Our sponsor and its affiliates or designees are obligated to fund the trust account to extend the time for us to complete our initial business combination, but our sponsor and its affiliates will not be obligated to extend such time. Initial Business Combination The rules of the NYSE require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the net assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. We refer to this as the 80% of net assets test. The fair market value of the target or targets will be determined by our board of directors based upon one or more standards generally accepted by the financial community (such as actual and potential sales, earnings, cash flow and/or book value). Even though our board of directors will rely on generally accepted standards, our board of directors will have discretion to select the standards employed. In addition, the application of the standards generally involves a substantial degree of judgment. Accordingly, investors will be relying on the business judgment of the board of directors in evaluating the fair market value of the target or targets. The proxy solicitation materials or tender offer documents used by us in connection with any proposed transaction will provide public stockholders with our analysis of our satisfaction of the 80% of net assets test, as well as the basis for our determinations. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm which is a member of the Financial Industry Regulatory Authority, or FINRA or a valuation or appraisal firm with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. Our Acquisition Process In evaluating a prospective target business, we expect to conduct a thorough due diligence review which will encompass, among other things, meetings with incumbent management and employees, document reviews, technology reviews, industry research and reviews, as well as a review of financial, operational, legal and other information which will be made available to us. We will also utilize our operational and capital planning experience to evaluate the proprietary opportunity. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm that is a member of FINRA, or from an independent accounting firm, that our initial business combination is fair to our company from a financial point of view. 10 Members of our management team and sponsor may directly or indirectly own our common stock and/or private placement warrants following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. In particular, because the founder shares were purchased at a purchase price of approximately $0.005 per share, the holders of our founder shares (including certain members of our management team that directly or indirectly own founder shares) could make a substantial profit after our initial business combination even if our public stockholders lose money on their investment as a result of a decrease in the post-business combination value of their shares of Class A common stock (after accounting for any adjustments in connection with an exchange or other transaction contemplated by the business combination). Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. We currently do not have any specific business combination under consideration. Our officers and directors have neither individually identified nor considered a target business for our initial business combination. We have not, nor has anyone on our behalf, taken any measure, directly or indirectly, to identify or locate any suitable acquisition candidate for us, nor have we engaged or retained any agent or other representative to identify or locate any such acquisition candidate. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such entity, subject to his or her fiduciary duties under Delaware law. We expect that if an opportunity is presented to one of our officers or directors in his or her capacity as an officer or director of one of those other entities, such opportunity would be presented to such other entity and not to us. For more information on the entities to which our officers and directors currently have fiduciary or contractual obligations, please refer to "Management — Conflicts of Interest." We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our initial business combination. Conclusion We believe the collective experience of our management team, directors and advisors will lead to many potential acquisition opportunities. Upon completion of this offering, members of our management team and advisors will reach out to their networks of relationships to articulate the parameters of our search for a target company and will begin the rigorous process of pursuing and reviewing promising opportunities. In addition, we anticipate that target business candidates may be brought to our attention from various unaffiliated sources, including healthcare market participants, healthcare private equity and generalist venture capital firms, investment banking firms, consultants, legal and accounting firms and large business enterprises. We have recruited and organized a group of highly accomplished and engaged directors who will bring to us public company governance, executive leadership, and operations oversight. Our board members have served in director, officer, partner, and other executive and advisory capacities for publicly traded and privately-owned companies. Our directors have extensive experience with public equity investing, private equity investing, venture capital, mergers and acquisitions, divestitures and corporate strategy. We believe their collective expertise, contacts and relationships make us a highly desirable merger partner. In addition to our directors, we have recruited four highly accomplished senior advisors who will serve on our Advisory Board and will bring to us significant experience in operations, investment management, public and private equity and debt capital markets. Our Advisory Board will advise us on executive leadership, human capital management, corporate strategy and capital markets. Our Advisory Board members have served as directors, officers, executives, and partners for publicly-traded and privately-owned companies and private equity firms. In addition to advising us on assessment of key risks and opportunities and due diligence, our senior advisors may also advise us after the completion of our business combination in overseeing our strategy and value creation plan where relevant expertise exists. 11 The past performance of our management team, Martin Ventures or First Trust Capital Partners is not a guarantee either (i) of success with respect to any business combination we may consummate or (ii) that we will be able to identify a suitable candidate for our initial business combination. No member of our management team has had management experience with special purpose acquisition corporations in the past. You should not rely on the historical record of our management teams, Martin Ventures, First Trust Capital Partners or their respective affiliates performance as indicative of our future performance. Additionally, during their respective careers, members of our management team have been involved in businesses and deals that were unsuccessful. Our officers and directors may have conflicts of interest with other entities to which they owe fiduciary or contractual obligations with respect to initial business combination opportunities. For a list of our officers and directors and entities for which a conflict of interest may or does exist between such persons and the company, as well as the priority and preference that such entity has with respect to performance of obligations and presentation of business opportunities to us, please refer to the table and subsequent explanatory paragraph under "Management — Conflicts of Interest". Corporate Information Our executive offices are located at 40 Burton Hills Boulevard, Suite 100, Nashville, Tennessee 37215. We are an "emerging growth company," as defined in Section 2(a) of the Securities Act of 1933, as amended (the "Securities Act"), as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A common stock held by non-affiliates equaled or exceeded $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. Additionally, we are a "smaller reporting company" as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates equaled or exceeded $250 million as of the end of the prior June 30th, and (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year or the market value of our common stock held by non-affiliates equaled or exceeded $700 million as of the prior June 30th. 12 THE OFFERING In making your decision whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled "Risk Factors" of this prospectus. Securities offered 17,500,000 units (or 20,125,000 units if the underwriters over-allotment option is exercised in full), at $10.00 per unit, each unit consisting of: one share of Class A common stock; and one-half of one redeemable warrant. Proposed NYSE symbols Units: "FDHAU" Class A common stock: "FDHA" Warrants: "FDHAW" Trading commencement and separation of Class A common stock and warrants The units will begin trading on or promptly after the date of this prospectus. The Class A common stock and warrants constituting the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless William Blair informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the Class A common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into Class A common stock and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Additionally, the units will automatically separate into their component parts and will not be traded after completion of our initial business combination. Separate trading of the Class A common stock and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A common stock and warrants be traded separately until we have filed with the SEC a Current Report on Form 8-K which includes an audited balance sheet of the company reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. 13 Units: Number issued and outstanding before this offering 0 Number issued and outstanding after this offering 17,500,000(1) Common stock: Number issued and outstanding before this offering 5,031,250(2)(3) Number issued and outstanding after this offering 21,875,000(1)(3)(4) Warrants: Number of private placement warrants to be sold in a private placement simultaneously with this offering 9,700,000(1) Number of warrants to be outstanding after this offering and the sale of private placement warrants 18,450,000(1) Exercisability Each whole warrant offered in this offering is exercisable to purchase one share of Class A common stock, subject to adjustment as provided herein, and only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We structured each unit to contain one-half of one redeemable warrant, with each whole warrant exercisable for one share of Class A common stock, as compared to units issued by some other similar blank check companies which contain whole warrants exercisable for one whole share. We structured each unit this way to reduce the dilutive effect of the warrants upon completion of our initial business combination as compared to units that each contain a whole warrant to purchase one whole share, which we believe will make us a more attractive business combination partner for target businesses. ____________ (1) Assumes no exercise of the underwriters over-allotment option and the forfeiture of 656,250 founder shares. (2) Consists solely of founder shares and includes up to 656,250 common stock that are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. (3) Founder shares are currently classified as Class B common stock, which shares will convert into shares of Class A common stock on a one-for-one basis, subject to adjustment as described below adjacent to the caption "Founder shares conversion and anti-dilution rights." (4) Includes 17,500,000 public shares and 4,375,000 founder shares. 14 Exercise price $11.50 per share, subject to adjustment as described herein. In addition, if (x) we issue additional common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or such affiliates, as applicable, prior to such issuance) (the "Newly Issued Price"), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the completion of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our shares of Class A common stock during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the "Market Value") is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $10.00 and $18.00 per share redemption trigger prices described below under "Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00" and "Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00" will be adjusted (to the nearest cent) to be equal to 100% and 180%, respectively, of the higher of the Market Value and the Newly Issued Price. Exercise period The warrants will become exercisable on the later of: 30 days after the consummation of an initial business combination, and 12 months from the closing of this offering; provided, in each case, that we have an effective registration statement under the Securities Act covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants and a current prospectus relating to them is available and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement, including as a result of a notice of redemption described below under "Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00"). We are not registering shares of Class A common stock issuable upon exercise of the warrants under the Securities Act or any state securities laws at this time. However, under the terms of the warrant agreement, we have agreed that as soon as practicable, but in no event later than 15 business days after the closing of our initial business combination, we will use our commercially reasonable efforts to file with the SEC a registration statement covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants, and we will use our commercially reasonable efforts to cause the same to become effective within 60 business days after the closing of our initial business combination and to maintain the effectiveness of such registration statement and a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed; provided that if our shares of Class A common stock are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a "covered security" under Section 18(b)(1) 15 of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a "cashless basis" in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00 Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the private placement warrants): in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption to each warrant holder, which we refer to as the "30-day redemption period;" and if, and only if, the last reported sale price (the "closing price") of our Class A common stock for any 20 trading days within the 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading "Description of Securities — Redeemable Warrants — Public Stockholders Warrants — Anti-dilution Adjustments"). We will not redeem the warrants as described above unless a registration statement under the Securities Act covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants is then effective and a current prospectus relating to those Class A common stock is available throughout the 30-day redemption period, unless we have elected to require the exercise of the warrants on a cashless basis and the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00 Once the warrants become exercisable, we may redeem the outstanding warrants: in whole and not in part; at a price of $0.10 per warrant upon a minimum of 30 days prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to the table set forth under "Description of Securities — Redeemable Warrants — Public Stockholders Warrants" based on the redemption date and the "fair market value" of our Class A common stock (as defined below) except as otherwise described in "Description of Securities — Redeemable Warrants — Public Stockholders Warrants;" 16 if, and only if, the closing price of our Class A common stock equals or exceeds $10.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading "Description of Securities — Redeemable Warrants — Public Stockholders Warrants — Anti-dilution Adjustments") for any 20 trading days within the 30-trading day period ending three trading days before we send the notice of redemption to the warrant holders; and if the closing price of our Class A common stock for any 20 trading days within the 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders is less than $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading "Description of Securities — Redeemable Warrants — Public Stockholders Warrants — Anti-dilution Adjustments"), the private placement warrants must also be concurrently called for redemption on the same terms as the outstanding public warrants, as described above. The "fair market value" of our Class A common stock shall mean the volume weighted average price of our Class A common stock as reported during the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. This redemption feature differs from the typical warrant redemption features used in many other blank check offerings. In no event will the warrants be exercisable on a cashless basis in connection with this redemption feature for more than 0.361 shares of Class A common stock per warrant (subject to adjustment). No fractional shares of Class A common stock will be issued upon redemption. If, upon redemption, a holder would be entitled to receive a fractional interest in a share, we will round down to the nearest whole number of the number of shares of Class A common stock to be issued to the holder. Please see the section entitled "Description of Securities — Redeemable Warrants — Public Stockholders Warrants" for additional information. Accounting for the public warrants and private warrants The public warrants that are to be issued in this offering and the private warrants that are to be issued concurrently with this offering will be accounted for as a liability measured at the estimated fair value of the total outstanding public and private warrants. In addition, at each reporting period (1) the accounting treatment of the warrants will be reevaluated for proper accounting treatment as a liability or equity and (2) the fair value of the liability of the public and private warrants will be remeasured and the change in the fair value of the liability will be recorded as other income (expense) in our statements of operations. Founder shares On May 12, 2021, our sponsor paid $25,000 to cover certain of our offering and formation costs in exchange for an aggregate of 5,750,000 shares of Class B common stock, par value $0.0001 per share. On November 30, 2021, our sponsor surrendered 718,750 founder shares for no consideration, resulting in our sponsor holding 5,031,250 shares of Class B common stock, representing an effective purchase price of approximately $0.005 per share. Our sponsor also transferred an aggregate of 200,000 founder shares to our outside directors, resulting in our sponsor holding 4,831,250 founder shares. 17 Prior to the initial investment in the company of $25,000 by our sponsor, the company had no assets, tangible or intangible. The purchase price of these founder shares was determined by dividing the amount of cash contributed to us by the number of founder shares issued. Our initial stockholders will collectively own 20% of our issued and outstanding shares after this offering (assuming they do not purchase any units in this offering). If we increase or decrease the size of this offering, we will effect a capitalization or share repurchase or redemption or other appropriate mechanism, as applicable, with respect to our founder shares immediately prior to the consummation of this offering in such amount as to maintain the number of founder shares at 20% of our issued and outstanding common stock upon the consummation of this offering. The founder shares are identical to the Class A common stock included in the units being sold in this offering, except that: prior to our initial business combination, only holders of the founder shares have the right to vote on the appointment of directors and holders of a majority of our founder shares may remove a member of the board of directors for any reason; the founder shares are subject to certain transfer restrictions, as described in more detail below; our initial stockholders, directors and officers have entered into a letter agreement with us, pursuant to which they have agreed to waive: (1) their redemption rights with respect to any founder shares and public shares held by them, as applicable, in connection with the completion of our initial business combination; (2) their redemption rights with respect to any founder shares and public shares held by them in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering or (B) with respect to any other material provision relating to Class A common stockholders rights or pre-initial business combination activity; and (3) their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). If we submit our initial business combination to our public stockholders for a vote, our initial stockholders, directors and officers have agreed to vote any founder shares and public shares held by them in favor of our initial business combination. As a result, in addition to our initial stockholders founder shares, we would need 6,562,501, or 37.50% (assuming all issued and outstanding shares are voted and the over-allotment option is not exercised), or 1,093,751, or 6.25% (assuming only the minimum number of shares representing a quorum are voted and the over-allotment option is not exercised), of the 17,500,000 public shares sold in this offering to be voted in favor of an initial business 18 combination in order to have such initial business combination approved (the number of public shares set forth above that would need to be voted in favor of an initial business combination would be reduced to the extent of any public shares held by our initial stockholders, directors and officers). We have agreed that we will not enter into a definitive agreement with respect to an initial business combination without the approval of our sponsor; the founder shares will automatically convert into shares of Class A common stock at the time of our initial business combination, or earlier at the option of the holder, on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described in more detail below; and the founder shares are entitled to registration rights. Transfer restrictions on founder shares Our initial stockholders have agreed not to transfer, assign or sell any of their founder shares until the earlier to occur of: (A) one year after the completion of our initial business combination; and (B) subsequent to our initial business combination (x) if the last reported sale price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for share splits, share dividends, rights issuances, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination or (y) the date on which we complete a liquidation, merger, share exchange, reorganization or other similar transaction that results in all of our public stockholders having the right to exchange their common stock for cash, securities or other property (except with respect to permitted transferees as described herein under "Principal Stockholders — Transfers of Founder Shares and Private Placement Warrants"). Any permitted transferees would be subject to the same restrictions and other agreements of our initial stockholders with respect to any founder shares. We refer to such transfer restrictions throughout this prospectus as the lock-up. Founder shares conversion and anti-dilution rights We have 5,031,250 shares of Class B common stock, par value $0.0001 per share, issued and outstanding. The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of our initial business combination, or earlier at the option of the holder, on a one-for-one basis, subject to adjustment for share splits, share dividends, rights issuances, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts issued in this offering and related to the closing of our initial business combination, the ratio at which the shares of Class B common stock will convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the issued and outstanding shares of Class B common stock agree to waive such anti-dilution adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of all common stock issued and outstanding upon the completion of our initial business combination plus, without duplication, all Class A common stock and equity-linked securities issued or deemed issued in connection with or in relation to the consummation of our initial business combination, excluding any shares of Class A common stock or equity-linked securities exercisable for or convertible into shares of Class A common stock issued, or to be issued, to any seller in the initial business combination and any warrants issued in a private placement to our sponsor or an affiliate of our sponsor upon conversion of working capital loans or extension loans. 19 In no event will any founder shares convert into shares of Class A common stock at a ratio that is less than one-for-one. The term "equity-linked securities" refers to any debt or equity securities that are convertible, exercisable or exchangeable for our Class A common stock issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt. Appointment of directors; Voting rights Prior to our initial business combination, only holders of our founder shares will have the right to vote on the appointment of directors. Holders of our public shares will not be entitled to vote on the appointment of directors during such time. In addition, prior to the completion of an initial business combination, holders of a majority of our founder shares may remove a member of the board of directors for any reason. These provisions of our amended and restated certificate of incorporation may only be amended by approval of at least 90% of the shares of our Class B common stock. With respect to any other matter submitted to a vote of our stockholders, including any vote in connection with our initial business combination, except as required by law, holders of our founder shares and holders of our public shares will vote together as a single class, with each share entitling the holder to one vote. Private placement warrants Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 9,700,000 (or 10,750,000 if the underwriters over-allotment option is exercised in full) private placement warrants at a price of $1.00 per warrant ($9,700,000 in the aggregate or $10,750,000 in the aggregate if the underwriters over-allotment option is exercised in full) in a private placement that will occur simultaneously with the closing of this offering. Each private placement warrant is exercisable to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment as provided herein. Private placement warrants may be exercised only for a whole number of shares. If we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, the proceeds of the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares (subject to the requirements of applicable law) and the private placement warrants will expire worthless. The private placement warrants will not be redeemable by us (except as described above under "Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00") so long as they are held by our sponsor or its permitted transferees. If the private placement warrants are held by holders other than our sponsor or its permitted transferees, the private placement warrants will be redeemable by us in all redemption scenarios and exercisable by the holders on the same basis as the warrants included in the units being sold in this offering. Our sponsor, as well as its permitted transferees, have the option to exercise the private placement warrants on a cashless basis. Transfer restrictions on private placement warrants The private placement warrants (including the shares of Class A common stock issuable upon exercise of the private placement warrants) will not be transferable, assignable or salable until 30 days after the completion of our initial business combination, except as described herein under "Principal Stockholders — Transfers of Founder Shares and Private Placement Warrants." Proceeds to be held in trust account The rules of the NYSE provide that at least 90% of the gross proceeds from this offering and the sale of the private placement warrants be deposited in a trust account. Of the $184,700,000 in proceeds we will receive from this offering and the sale of the private placement warrants described in this prospectus, or $212,000,000 if the underwriters 20 over-allotment option is exercised in full, $178,500,000 ($10.20 per unit), or $205,275,000 ($10.20 per unit) if the underwriters over-allotment option is exercised in full (including $6,125,000 (or up to $7,043,750 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions), will be deposited into a U.S.-based trust account at J.P. Morgan Chase Bank, N.A. with Continental Stock Transfer & Trust Company acting as trustee, and $2.7 million will be used to pay expenses in connection with the closing of this offering and for working capital following this offering. The funds in the trust account will be invested only in U.S. government treasury bills with a maturity of 185 days or less or in money market funds investing solely in U.S. Treasuries. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, if any, the funds held in the trust account will not be released from the trust account until the earliest to occur of: (1) our completion of an initial business combination; (2) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering or (B) with respect to any other material provision relating to Class A common stockholders rights or pre-initial business combination activity; and (3) the redemption of our public shares if we have not completed an initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. Anticipated expenses and funding sources Unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use, except the withdrawal of interest to pay taxes or to redeem our public shares in connection with an amendment to our amended and restated certificate of incorporation, as described above. Based upon current interest rates, we expect the trust account to generate approximately $142,800 of interest annually (assuming an interest rate of 0.08% per year). Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement warrants not held in the trust account, which will be approximately $1,950,000 in working capital after the payment of approximately $750,000 in expenses relating to this offering (other than underwriting commissions); and any loans or additional investments from our sponsor, members of our management team or any of their affiliates or other third parties, although they are under no obligation to loan funds to, or otherwise invest in, us; and provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of our initial business combination. 21 Conditions to completing our initial business combination There is no limitation on our ability to raise funds privately or through loans in connection with our initial business combination. The rules of the NYSE require that an initial business combination must be with one or more operating businesses or assets with a fair market value equal to at least 80% of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the income earned on the trust account). We refer to this as the 80% of net assets test. The fair market value of the target or targets will be determined by our board of directors based upon one or more standards generally accepted by the financial community (such as actual and potential sales, earnings, cash flow and/or book value). Even though our board of directors will rely on generally accepted standards, our board of directors will have discretion to select the standards employed. In addition, the application of the standards generally involves a substantial degree of judgment. Accordingly, investors will be relying on the business judgment of the board of directors in evaluating the fair market value of the target or targets. The proxy solicitation materials or tender offer documents used by us in connection with any proposed transaction will provide public stockholders with our analysis of our satisfaction of the 80% of net assets test, as well as the basis for our determinations. If our board of directors is not able independently to determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. We will complete our initial business combination only if the post-transaction company in which our public stockholders own shares will own or acquire 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the "Investment Company Act"). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our initial business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test; provided that in the event that our initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. Ability to Extend Time to Complete Business Combination If we anticipate that we may not be able to consummate our initial business combination within 15 months from the consummation of this offering, we may, but are not obligated to, if requested by our sponsor or its affiliates, extend the period of time to consummate a business combination with up to two Paid Extensions (up to an additional six months) for a total of 21 months. 22 In the case of the Paid Extension Period, public stockholders will not be offered the opportunity at the time of the extension to vote on or redeem their shares if we choose to make any such Paid Extension. As a result, we may conduct such an extension even though a majority of our public stockholders do not support such an extension and will not be able to redeem their shares in connection therewith. Pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order to avail ourselves of each Paid Extension to consummate our initial business combination, our sponsor or its affiliates or designees, upon five days advance notice prior to the then-applicable initial business combination deadline, must deposit into the trust account an amount per Paid Extension of $1,750,000, or $2,012,500 if the underwriters over-allotment option is exercised in full ($0.10 per share in either case), on or prior to the date of the then-applicable initial business combination deadline. Any such payments would be made in the form of a loan, which will be non-interest bearing and payable upon the consummation of our initial business combination. If we complete our initial business combination, we would repay such loaned amounts out of the proceeds of the trust account released to us or, at the option of the lender, convert such loaned amounts into private placement warrants of the post business combination entity at a price of $1.00 per warrant. In the event that we receive notice from our sponsor or its affiliates five days prior to the then-applicable initial business combination deadline of its wish for us to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the then-applicable initial business combination deadline announcing whether or not the funds had been timely deposited. Our sponsor and its affiliates or designees are obligated to fund the trust account to extend the time for us to complete our initial business combination, but our sponsor and its affiliates will not be obligated to extend such time. Permitted purchases and other transactions with respect to our securities If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, officers, advisors or any of their affiliates may purchase public shares or warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Any such price per share may be different than the amount per share a public stockholder would receive if it elected to redeem its shares in connection with our initial business combination. Additionally, at any time at or prior to our initial business combination, subject to applicable securities laws (including with respect to material nonpublic information), our sponsor, directors, officers, advisors or any of their affiliates may enter into transactions with investors and others to provide them with incentives to acquire public shares, vote their public shares in 23 favor of our initial business combination or not redeem their public shares. However, our sponsor, directors, officers, advisors or any of their affiliates are under no obligation or duty to do so and they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds held in the trust account will be used to purchase public shares or warrants in such transactions. If our sponsor, directors, officers, advisors or any of their affiliates engage in such transactions, they will be restricted from making any such purchases when they are in possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). See "Proposed Business — Permitted purchases and other transactions with respect to our securities" for a description of how our sponsor, directors, officers, advisors or any of their affiliates will select which stockholders to enter into private transactions with. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Our sponsor, directors, officers, advisors or any of their affiliates will be restricted from making any purchases if such purchases would violate Section 9(a)(2) of, or Rule 10b-5 under, the Exchange Act. Redemption rights for public stockholders upon completion of our initial business combination We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of our initial business combination, including interest (which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.20 per public share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. The redemption rights will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our initial stockholders, directors and officers have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and public shares held by them in connection with the completion of our initial business combination. 24 Manner of conducting redemptions We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (1) in connection with a stockholder meeting called to approve the business combination or (2) by means of a tender offer. The decision as to whether we will seek stockholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval under applicable law or stock exchange listing requirement. Asset acquisitions and share purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our issued and outstanding common stock or seek to amend our amended and restated certificate of incorporation would typically require stockholder approval. We intend to conduct redemptions without a stockholder vote pursuant to the tender offer rules of the SEC unless stockholder approval is required by applicable law or stock exchange listing requirement or we choose to seek stockholder approval for business or other reasons. If a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other reasons, we will, pursuant to our amended and restated certificate of incorporation: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E under the Exchange Act, which regulate issuer tender offers; and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A under the Exchange Act, which regulates the solicitation of proxies. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we and our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase our common stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public stockholders not tendering more than a specified number of public shares, which number will be based on the requirement that we may not redeem public shares in an amount that would cause our net tangible assets to be less than $5,000,001 following such redemptions, or any greater net tangible asset or cash requirement that may be contained in the agreement relating to our initial business combination. If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete such initial business combination. 25 If, however, stockholder approval of the transaction is required by applicable law or stock exchange listing requirement, or we decide to obtain stockholder approval for business or other reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A under the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and file proxy materials with the SEC. We expect that a final proxy statement would be mailed to public stockholders at least 10 days prior to the stockholder vote. However, we expect that a draft proxy statement would be made available to such stockholders well in advance of such time, providing additional notice of redemption if we conduct redemptions in conjunction with a proxy solicitation. Although we are not required to do so, we currently intend to comply with the substantive and procedural requirements of Regulation 14A in connection with any stockholder vote even if we are not able to maintain our NYSE listing or Exchange Act registration. If we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the Company representing a majority of the voting power of all outstanding shares of capital stock of the Company entitled to vote at such meeting. In such case, pursuant to the terms of a letter agreement entered into with us, our initial stockholders have agreed (and their permitted transferees will agree) to vote their founder shares and any public shares held by them in favor of our initial business combination. We expect that at the time of any stockholder vote relating to our initial business combination, our initial stockholders and their permitted transferees will own at least 20% of our issued and outstanding common stock entitled to vote thereon. Our directors and officers also have agreed to vote in favor of our initial business combination with respect to any public shares acquired by them. These voting thresholds, and the voting agreements of our initial stockholders, may make it more likely that we will consummate our initial business combination. Each public stockholder may elect to redeem their public shares without voting, and if they do vote, irrespective of whether they vote for or against the proposed transaction. Our amended and restated certificate of incorporation will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 following such redemptions. Redemptions of our public shares may also be subject to a higher net tangible asset test or cash requirement pursuant to an agreement relating to our initial business combination. For example, the proposed business combination may require: (1) cash consideration to be paid to the target or its owners; (2) cash to be transferred to the target for working capital or other general corporate purposes; or (3) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration we would be required to pay for all public shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all common stock submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate business combination. 26 Tendering share certificates in connection with a tender offer or redemption rights We may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in "street name," to either tender their certificates to our transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up to two business days prior to the initially scheduled vote on the proposal to approve our initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically using The Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option, rather than simply voting against the initial business combination. The tender offer or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public stockholders to satisfy such delivery requirements, which will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. Limitation on redemption rights of stockholders holding more than 15% of the shares sold in this offering if we hold stockholder vote Notwithstanding the foregoing redemption rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a "group" (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. We believe the restriction described above will discourage stockholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our sponsor or its affiliates to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public stockholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us or our sponsor or its affiliates at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders ability to vote all of their shares (including all shares held by those stockholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. 27 Redemption rights in connection with proposed amendments to our amended and restated certificate of incorporation Some other blank check companies have a provision in their charter which prohibits the amendment of certain charter provisions. Our amended and restated certificate of incorporation will provide that any of its provisions (other than amendments relating to provisions governing the appointment or removal of directors prior to our initial business combination, which require the approval of at least 90% of the shares of our Class B common stock) related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the sale of the private placement warrants into the trust account and not release such amounts except in specified circumstances) may be amended if approved by holders of at least 65% of our common stock who attend and vote in a stockholder meeting, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of at least 65% of our common stock. Our initial stockholders, who will beneficially own 20% of our common stock upon the closing of this offering (assuming they do not purchase any units in this offering), may participate in any vote to amend our amended and restated certificate of incorporation and/or trust agreement and will have the discretion to vote in any manner they choose. Our sponsor, officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering or (B) with respect to any other material provision relating to Class A common stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their public shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares. Our initial stockholders, directors and officers have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and public shares held by them in connection with the completion of our initial business combination. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, all amounts held in the trust account will be disbursed directly by the trustee or released to us to pay amounts due to any public stockholders who properly exercise their redemption rights as described above under "Redemption rights for public stockholders upon completion of our initial business combination," to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or the redemption of our public shares, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. 28 Redemption of public shares and distribution and liquidation if no initial business combination Our sponsor, officers and directors have agreed that we will have only 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering to complete our initial business combination. If we have not completed our initial business combination within such 15-month period (subject to any extensions), we will: (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably possible but not more than 10 business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (less up to $100,000 of interest to pay dissolution expenses and which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any); and (3) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within the 15-month time period (subject to any extensions). Our initial stockholders have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering. However, if our initial stockholders acquire public shares, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted 15-month time frame (subject to any extensions). The underwriters have agreed to waive their rights to their deferred underwriting commission held in the trust account in the event we do not complete our initial business combination within the allotted time frame and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. Our sponsor, officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering or (B) with respect to any other material provision relating to Class A common stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their public common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares. However, we may not redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 following such redemptions. 29 Limited payments to insiders There will be no finder s fees, reimbursements or cash payments made by us to our sponsor, directors or officers, or our or any of their affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination, other than the following payments, none of which will be made from the proceeds of this offering and the sale of the private placement warrants held in the trust account prior to the completion of our initial business combination: repayment of an aggregate of up to $350,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; payments to affiliates of our sponsor of $10,000 per month in aggregate for office space, secretarial and administrative services provided to members of our management team; reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our directors and officers to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender; and repayment of loans in an amount per Paid Extension up to $1,750,000, or $2,012,500 if the underwriters over-allotment option is exercised in full, if we extend the period of time to consummate a business combination as described in this prospectus. These payments may be funded using the net proceeds of this offering and the sale of the private placement warrants not held in the trust account or, upon completion of the initial business combination, from any amounts remaining from the proceeds of the trust account released to us in connection therewith. Our audit committee will review on a quarterly basis all payments that were made by us to our sponsor, directors or officers, or our or any of their affiliates. Audit committee Prior to the effectiveness of this registration statement, we will have established and will maintain an audit committee to, among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to promptly take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled "Management — Committees of the Board of Directors — Audit Committee." 30 Conflicts of interest Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to another entity pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such entity. Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation. We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our initial business combination. For more information, see the section entitled "Management — Conflicts of Interest." Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party (other than our independent registered public accounting firm) for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (1) $10.00 per public share or (2) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third-party claims. We have not independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that our sponsor s only assets are securities of our company and, therefore, our sponsor may not be able to satisfy those obligations. We have not asked our sponsor to reserve for such obligations. 31 RISKS We are a newly incorporated company that has conducted no operations and has generated no revenues. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision whether to invest in our securities, you should take into account not only the background of our management team, but also the special risks we face as a blank check company. This offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see "Proposed Business — Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419." You should carefully consider these and the other risks set forth in the section entitled "Risk Factors" beginning on page 34 of this prospectus. Summary of Risk Factors An investment in our securities involves a high degree of risk. The occurrence of one or more of the events or circumstances described in the section titled "Risk Factors," alone or in combination with other events or circumstances, may materially adversely affect our business, financial condition and operating results. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. Such risks include, but are not limited to: We are a newly incorporated company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. Our public stockholders may not be afforded an opportunity to vote on our proposed business combination, which means we may complete our initial business combination even though a majority of our public stockholders do not support such a combination. Your only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash, unless we seek stockholder approval of such business combination. If we seek stockholder approval of our initial business combination, our initial stockholders, directors and officers have agreed to vote in favor of such initial business combination, regardless of how our public stockholders vote. The ability of our public stockholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combination with a target. The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure. The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares. The requirement that we complete our initial business combination within the prescribed time frame may give potential target businesses leverage over us in negotiating a business combination and may limit the time we have in which to conduct due diligence on potential business combination targets, in particular as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our stockholders. As the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets. This could increase the cost of our initial business combination and could even result in our inability to find a target or to consummate an initial business combination. 32 Changes in the market for directors and officers liability insurance could make it more difficult and more expensive for us to negotiate and complete an initial business combination. We may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public stockholders may receive only $10.20 per share, or less than such amount in certain circumstances, and our warrants will expire worthless. If we seek stockholder approval of our initial business combination, our sponsor, directors, officers, advisors or any of their affiliates may elect to purchase shares or warrants from public stockholders, which may influence a vote on a proposed business combination and reduce the public "float" of our securities. If a stockholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for tendering its shares, such shares may not be redeemed. You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. To liquidate your investment, therefore you may be forced to sell your public shares and/or warrants, potentially at a loss. The NYSE may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities and subject us to additional trading restrictions. You will not be entitled to protections normally afforded to investors of many other blank check companies. If the net proceeds of this offering and the sale of the private placement warrants not being held in the trust account are insufficient, it could limit the amount available to fund our search for a target business or businesses and complete our initial business combination, and we may depend on loans from our sponsor or management team to fund our search, to pay our taxes and to complete our initial business combination. If we acquire a company in the healthcare or healthcare services industry, our future operations may be subject to risks associated with such sectors. Past performance by our management team and their affiliates may not be indicative of future performance of an investment in the company. The other risks and uncertainties discussed in "Risk Factors" and elsewhere in this prospectus. 33 RISK FACTORS An investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together with the other information contained in this prospectus, before making a decision to invest in our units. If any of the following events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. Risks Relating to our Search for, Consummation of, or Inability to Consummate, a Business Combination and Post-Business Combination Risks Our public stockholders may not be afforded an opportunity to vote on our proposed business combination, which means we may complete our initial business combination even though a majority of our public stockholders do not support such a combination. We may not hold a stockholder vote to approve our initial business combination unless the business combination would require stockholder approval under applicable law or stock exchange rules or if we decide to hold a stockholder vote for business or other reasons. For instance, the rules of the NYSE currently allow us to engage in a tender offer in lieu of a stockholder meeting, but would still require us to obtain stockholder approval if we were seeking to issue more than 20% of our issued and outstanding shares to a target business as consideration in any business combination. Therefore, if we were structuring a business combination that required us to issue more than 20% of our issued and outstanding shares, we would seek stockholder approval of such business combination. However, except as required by applicable law or stock exchange rules, the decision as to whether we will seek stockholder approval of a proposed business combination or will allow stockholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek stockholder approval. Accordingly, we may consummate our initial business combination even if holders of a majority of the issued and outstanding common stock do not approve of the business combination we consummate. Please see the section entitled "Proposed Business — Effecting Our Initial Business Combination — Stockholders may not have the ability to approve our initial business combination" for additional information. Your only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash, unless we seek stockholder approval of such business combination. At the time of your investment in us, you will not be provided with an opportunity to evaluate the specific merits or risks of any target businesses. Additionally, since our board of directors may complete a business combination without seeking stockholder approval, public stockholders may not have the right or opportunity to vote on the business combination, unless we seek such stockholder approval. Accordingly, if we do not seek stockholder approval, your only opportunity to affect the investment decision regarding a potential business combination may be limited to exercising your redemption rights within the period of time (which will be at least 20 business days) set forth in our tender offer documents mailed to our public stockholders in which we describe our initial business combination. If we seek stockholder approval of our initial business combination, our initial stockholders, directors and officers have agreed to vote in favor of such initial business combination, regardless of how our public stockholders vote. Unlike many other blank check companies in which the initial stockholders agree to vote their founder shares in accordance with the majority of the votes cast by the public stockholders in connection with an initial business combination, our initial stockholders, directors and officers have agreed (and their permitted transferees will agree), pursuant to the terms of a letter agreement entered into with us, to vote their founder shares and any public shares held by them in favor of our initial business combination. As a result, in addition to our initial stockholders founder shares, we would need 6,562,501, or 37.50% (assuming all issued and outstanding shares are voted and the over-allotment option is not exercised), or 1,093,751, or 6.25% (assuming only the minimum number of shares representing a quorum are voted and the over-allotment option is not exercised), of the 17,500,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have such initial business 34 combination approved (the number of public shares set forth above that would need to be voted in favor of an initial business combination would be reduced to the extent of any public shares held by our initial stockholders, directors and officers). Our directors and officers have also entered into the letter agreement, imposing similar obligations on them with respect to public shares acquired by them, if any. The number of public shares set forth above that would need to be voted in favor of an initial business combination would be reduced to the extent of any public shares held by our initial stockholders, directors and officers. We expect that our initial stockholders and their permitted transferees will own at least 20% of our issued and outstanding common stock at the time of any such stockholder vote. Accordingly, if we seek stockholder approval of our initial business combination, it is more likely that the necessary stockholder approval will be received than would be the case if such persons agreed to vote their founder shares in accordance with the majority of the votes cast by our public stockholders. The ability of our public stockholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combination with a target. We may seek to enter into a business combination transaction agreement with a prospective target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. If too many public stockholders exercise their redemption rights, we would not be able to meet such closing condition and, as a result, would not be able to proceed with the business combination. The amount of the deferred underwriting commissions payable to the underwriters will not be adjusted for any shares that are redeemed in connection with a business combination and such amount of deferred underwriting discount is not available for us to use as consideration in an initial business combination. If we are able to consummate an initial business combination, the per-share value of shares held by non-redeeming stockholders will reflect our obligation to pay and the payment of the deferred underwriting commissions. Furthermore, in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 following such redemptions, or any greater net tangible asset or cash requirement that may be contained in the agreement relating to our initial business combination. Consequently, if accepting all properly submitted redemption requests would cause our net tangible assets to be less than $5,000,001 or such greater amount necessary to satisfy a closing condition as described above, we would not proceed with such redemption and the related business combination and may instead search for an alternate business combination. Prospective targets will be aware of these risks and, thus, may be reluctant to enter into a business combination transaction with us. The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure. At the time we enter into an agreement for our initial business combination, we will not know how many stockholders may exercise their redemption rights and, therefore, we will need to structure the transaction based on our expectations as to the number of shares that will be submitted for redemption. If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the trust account to meet such requirements, or arrange for third-party financing. In addition, if a larger number of shares is submitted for redemption than we initially expected, we may need to restructure the transaction to reserve a greater portion of the cash in the trust account or arrange for third-party financing. Raising additional third-party financing may involve dilutive equity issuances or the incurrence of indebtedness at higher than desirable levels. The above considerations may limit our ability to complete the most desirable business combination available to us or optimize our capital structure. The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares. If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have a minimum amount of cash at closing, the probability that our initial business combination would be unsuccessful increases. If our initial business combination is unsuccessful, you would not receive your pro rata portion of the trust account until we liquidate the trust account. If you are in need of immediate liquidity, you could attempt to sell your shares in the open market; however, at such time our shares may trade at a discount to the pro rata amount per share in the trust account. In either situation, you may suffer a material loss on your investment or lose the benefit of funds expected in connection with our redemption until we liquidate or you are able to sell your shares in the open market. 35 The requirement that we complete our initial business combination within the prescribed time frame may give potential target businesses leverage over us in negotiating a business combination and may limit the time we have in which to conduct due diligence on potential business combination targets, in particular as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our stockholders. Any potential target business with which we enter into negotiations concerning a business combination will be aware that we must complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering. Consequently, such target business may obtain leverage over us in negotiating a business combination, knowing that if we do not complete our initial business combination with that particular target business, we may be unable to complete our initial business combination with any target business. This risk will increase as we get closer to the end of the 15-month period (subject to any extensions). In addition, we may have limited time to conduct due diligence and may enter into our initial business combination on terms that we would have rejected upon a more comprehensive investigation. As the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets. This could increase the cost of our initial business combination and could even result in our inability to find a target or to consummate an initial business combination. In recent years, the number of special purpose acquisition companies that have been formed has increased substantially. Many potential targets for special purpose acquisition companies have already entered into an initial business combination, and there are still many companies preparing for an initial public offering. As a result, at times, fewer attractive targets may be available to consummate an initial business combination. In addition, because there are more special purpose acquisition companies seeking to enter into an initial business combination with available targets, the competition for available targets with attractive fundamentals or business models may increase, which could cause targets companies to demand improved financial terms. Attractive deals could also become scarcer for other reasons, such as economic or industry sector downturns, geopolitical tensions, or increases in the cost of additional capital needed to close business combinations or operate targets post-business combination. This could increase the cost of, delay or otherwise complicate or frustrate our ability to find and consummate an initial business combination, and may result in our inability to consummate an initial business combination on terms favorable to our investors altogether. Changes in the market for directors and officers liability insurance could make it more difficult and more expensive for us to negotiate and complete an initial business combination. In recent months, the market for directors and officers liability insurance for special purpose acquisition companies has changed. Fewer insurance companies are offering quotes for directors and officers liability coverage, the premiums charged for such policies have generally increased and the terms of such policies have generally become less favorable. There can be no assurance that these trends will not continue. The increased cost and decreased availability of directors and officers liability insurance could make it more difficult and more expensive for us to negotiate an initial business combination. In order to obtain directors and officers liability insurance or modify its coverage as a result of becoming a public company, the post-business combination entity might need to incur greater expense, accept less favorable terms or both. However, any failure to obtain adequate directors and officers liability insurance could have an adverse impact on the post-business combination s ability to attract and retain qualified officers and directors. In addition, even after we were to complete an initial business combination, our directors and officers could still be subject to potential liability from claims arising from conduct alleged to have occurred prior to the initial business combination. As a result, in order to protect our directors and officers, the post-business combination entity may need to purchase additional insurance with respect to any such claims ("run-off insurance"). The need for run-off insurance would be an added expense for the post-business combination entity, and could interfere with or frustrate our ability to consummate an initial business combination on terms favorable to our investors. 36 Because our trust account will initially contain $10.20 per share of Class A common stock, public stockholders may be more incentivized to redeem their public shares at the time of our initial business combination. Our trust account will initially contain $10.20 per share of Class A common stock. This is different than some other similarly structured blank check companies for which the trust account will only contain $10.00 per share of Class A common stock. As a result of the additional funds that could be available to public stockholders upon redemption of public shares, our public stockholders may be more incentivized to redeem their public shares and not to hold those shares of Class A common stock through our initial business combination. A higher percentage of redemptions by our public stockholders could make it more difficult for us to complete our initial business combination. We may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public stockholders may receive only $10.20 per share, or less than such amount in certain circumstances, and our warrants will expire worthless. Our sponsor, directors and officers have agreed that we must complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering. We may not be able to find a suitable target business and complete our initial business combination within such time period. Our ability to complete our initial business combination may be negatively impacted by general market conditions, volatility in the capital and debt markets and the other risks described herein. For example, the COVID-19 pandemic continues to affect the U.S. and global markets and, while the extent of the impact of the pandemic on us will depend on future developments, it could limit our ability to complete our initial business combination, including as a result of increased market volatility, decreased market liquidity and third-party financing being unavailable on terms acceptable to us or at all. Additionally, the COVID-19 pandemic may negatively impact businesses we may seek to acquire. If we have not completed our initial business combination within such time period, we will: (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably possible but not more than 10 business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (less up to $100,000 of interest to pay dissolution expenses and which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any); and (3) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. In such case, our public stockholders may receive only $10.20 per share, or less than $10.20 per share, on the redemption of their shares, and our warrants will expire worthless. See "— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share" and other risk factors herein. If we seek stockholder approval of our initial business combination, our sponsor, directors, officers, advisors or any of their affiliates may elect to purchase shares or warrants from public stockholders, which may influence a vote on a proposed business combination and reduce the public "float" of our securities. If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, officers, advisors or any of their affiliates may purchase public shares or warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Any such price per share may be different than the amount per share a public stockholder would receive if it elected to redeem its shares in connection with our initial business combination. Additionally, at any time at or prior to our initial business combination, subject to applicable securities laws (including with respect to material nonpublic information), our sponsor, directors, officers, advisors or any of their affiliates may enter into transactions with investors and others to provide them with incentives to acquire public shares, vote their public shares in favor of our initial business combination or not redeem their public shares. However, our sponsor, directors, officers, advisors or any of their affiliates are under no obligation or duty to do so and they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. See "Proposed Business — Permitted purchases and other transactions with respect to our securities" for a 37 description of how our sponsor, directors, officers, advisors or any of their affiliates will select which stockholders to enter into private transactions with. The purpose of such transactions could be to vote such shares in favor of our initial business combination and thereby increase the likelihood of obtaining stockholder approval of our initial business combination or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination. This may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public "float" of our securities and the number of beneficial holders of our securities may be reduced, possibly making it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. If a stockholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for tendering its shares, such shares may not be redeemed. We will comply with the tender offer rules or proxy rules, as applicable, when conducting redemptions in connection with our initial business combination. Despite our compliance with these rules, if a stockholder fails to receive our tender offer or proxy materials, as applicable, such stockholder may not become aware of the opportunity to redeem its shares. In addition, the tender offer documents or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will describe the various procedures that must be complied with in order to validly tender or redeem public shares. In the event that a stockholder fails to comply with these procedures, its shares may not be redeemed. See "Proposed Business — Effecting Our Initial Business Combination — Tendering share certificates in connection with a tender offer or redemption rights." If the net proceeds of this offering and the sale of the private placement warrants not being held in the trust account are insufficient, it could limit the amount available to fund our search for a target business or businesses and complete our initial business combination and we may depend on loans from our sponsor or management team to fund our search, to pay our taxes and to complete our initial business combination. Of the net proceeds of this offering and the sale of the private placement warrants, only approximately $1,950,000 will be available to us initially outside the trust account to fund our working capital requirements. In the event that our offering expenses exceed our estimate of $750,000, we may fund such excess with funds not to be held in the trust account. In such case, the amount of funds we intend to be held outside the trust account would decrease by a corresponding amount. Conversely, in the event that the offering expenses are less than our estimate of $750,000, the amount of funds we intend to be held outside the trust account would increase by a corresponding amount. If we are required to seek additional capital, we would need to borrow funds from our sponsor, management team or other third parties to operate or may be forced to liquidate. Neither our sponsor, members of our management team nor any of their affiliates is under any obligation to loan funds to, or otherwise invest in, us in such circumstances. Any such loans may be repaid only from funds held outside the trust account or from funds released to us upon completion of our initial business combination. If we have not completed our initial business combination within the required time period because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the trust account. In such case, our public stockholders may receive only $10.20 per share, or less in certain circumstances, and our warrants will expire worthless. See "— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share" and other risk factors herein. If we seek stockholder approval of our initial business combination and we do not conduct redemptions pursuant to the tender offer rules, and if you or a "group" of stockholders are deemed to hold in excess of 15% of our shares of Class A common stock, you will lose the ability to redeem all such shares in excess of 15% of our shares of Class A common stock. If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or 38 any other person with whom such stockholder is acting in concert or as a "group" (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, which we refer to as the "Excess Shares," without our prior consent. However, we would not be restricting our stockholders ability to vote all of their shares (including Excess Shares) for or against our initial business combination. Your inability to redeem the Excess Shares will reduce your influence over our ability to complete our initial business combination and you could suffer a material loss on your investment in us if you sell Excess Shares in open market transactions. Additionally, you will not receive redemption distributions with respect to the Excess Shares if we complete our initial business combination. As a result, you will continue to hold that number of shares exceeding 15% and, in order to dispose of such shares, would be required to sell your shares in open market transactions, potentially at a loss. Because of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination. If we have not completed our initial business combination within the required time period, our public stockholders may receive only approximately $10.20 per share, or less in certain circumstances, on our redemption of their shares, and our warrants will expire worthless. We expect to encounter intense competition from other entities having a business objective similar to ours, including private investors (which may be individuals or investment partnerships), other blank check companies and other entities, domestic and international, competing for the types of businesses we intend to acquire. Many of these individuals and entities are well established and have extensive experience in identifying and effecting, directly or indirectly, acquisitions of companies operating in or providing services to various industries. Many of these competitors possess greater technical, human and other resources or more local industry knowledge than we do and our financial resources will be relatively limited when contrasted with those of many of these competitors. While we believe there are numerous target businesses we could potentially acquire with the net proceeds of this offering and the sale of the private placement warrants, our ability to compete with respect to the acquisition of certain target businesses that are sizable will be limited by our available financial resources. This inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target businesses. Furthermore, in the event we seek stockholder approval of our initial business combination and we are obligated to pay cash for our shares of Class A common stock, it will potentially reduce the resources available to us for our initial business combination. Any of these obligations may place us at a competitive disadvantage in successfully negotiating a business combination. If we have not completed our initial business combination within the required time period, our public stockholders may receive only approximately $10.20 per share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. See "— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share" and other risk factors herein. If the funds not being held in the trust account are insufficient to allow us to operate for at least the 15 months following the closing of this offering, we may be unable to complete our initial business combination. The funds available to us outside of the trust account may not be sufficient to allow us to operate for at least the 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) following the closing of this offering, assuming that our initial business combination is not completed during that time. We expect to incur significant costs in pursuit of our acquisition plans. Management s plans to address this need for capital through this offering and potential loans from certain of our affiliates are discussed in the section of this prospectus titled "Management s Discussion and Analysis of Financial Condition and Results of Operations." However, our affiliates are not obligated to make loans to us in the future, and we may not be able to raise additional financing from unaffiliated parties necessary to fund our expenses. Any such event in the future may negatively impact the analysis regarding our ability to continue as a going concern at such time. We believe that, upon the closing of this offering, the funds available to us outside of the trust account, will be sufficient to allow us to operate for at least the 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) following the closing of this offering; however, we cannot assure you that our estimate is accurate. Of the funds available to us, we could use a portion of the funds available to us to pay fees to consultants to assist us with our search for a target business. We could also use a portion of the funds as a down payment or to fund a "no-shop" provision (a provision in letters of intent designed to keep target businesses from "shopping" around for transactions with other companies or investors on terms more favorable to such target businesses) with respect to a particular proposed business combination, although we do 39 not have any current intention to do so. If we entered into a letter of intent where we paid for the right to receive exclusivity from a target business and were subsequently required to forfeit such funds (whether as a result of our breach or otherwise), we might not have sufficient funds to continue searching for, or conduct due diligence with respect to, a target business. If we have not completed our initial business combination within the required time period, our public stockholders may receive only approximately $10.20 per share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. See "— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share" and other risk factors herein. Subsequent to our completion of our initial business combination, we may be required to subsequently take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on our financial condition, results of operations and the price of our securities, which could cause you to lose some or all of your investment. Even if we conduct extensive due diligence on a target business with which we combine, we cannot assure you that this diligence will identify all material issues that may be present with a particular target business, that it would be possible to uncover all material issues through a customary amount of due diligence, or that factors outside of the target business and outside of our control will not later arise. As a result of these factors, we may be forced to later write down or write off assets, restructure our operations, or incur impairment or other charges that could result in our incurring losses. Even if our due diligence successfully identifies certain risks, unexpected risks may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though these charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative market perceptions about us or our securities. In addition, charges of this nature may cause us to violate net worth or other covenants to which we may be subject as a result of assuming pre-existing debt held by a target business or by virtue of our obtaining debt financing in conjunction with or following a business combination. Accordingly, any stockholder or warrant holder who chooses to remain a stockholder or warrant holder, respectively, following our initial business combination could suffer a reduction in the value of their securities. Such stockholders and warrant holders are unlikely to have a remedy for such reduction in value. If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share. Our placing of funds in the trust account may not protect those funds from third-party claims against us. Although we will seek to have all vendors, service providers (other than our independent registered public accounting firm), prospective target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our public stockholders, such parties may not execute such agreements, or even if they execute such agreements they may not be prevented from bringing claims against the trust account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain advantage with respect to a claim against our assets, including the funds held in the trust account. If any third party refuses to execute an agreement waiving such claims to the monies held in the trust account, our management will perform an analysis of the alternatives available to it and will enter into an agreement with a third party that has not executed a waiver only if management believes that such third party s engagement would be significantly more beneficial to us than any alternative. Examples of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third-party consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where we are unable to find a service provider willing to execute a waiver. In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason. Upon redemption of our public shares, if we have not completed our initial business combination within the required time period, or upon the exercise of a redemption right in connection with our initial business combination, we will be required to provide for payment of claims of creditors that were not waived that may be brought against us within the 10 years following redemption. Accordingly, the per-share redemption amount received by public stockholders could be less than the $10.20 per public share initially held in the trust account, due to claims of such creditors. 40 Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party (other than our independent registered public accounting firm) for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (1) $10.20 per public share or (2) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third-party claims. We have not independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that our sponsor s only assets are securities of our company. Our sponsor may not have sufficient funds available to satisfy those obligations. We have not asked our sponsor to reserve for such obligations, and therefore, no funds are currently set aside to cover any such obligations. As a result, if any such claims were successfully made against the trust account, the funds available for our initial business combination and redemptions could be reduced to less than $10.20 per public share. In such event, we may not be able to complete our initial business combination, and you would receive such lesser amount per share in connection with any redemption of your public shares. None of our directors or officers will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses. If we are deemed to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted, which may make it difficult for us to complete our initial business combination. If we are deemed to be an investment company under the Investment Company Act, our activities may be restricted, including: restrictions on the nature of our investments; and restrictions on the issuance of securities; each of which may make it difficult for us to complete our initial business combination. In addition, we may have imposed upon us burdensome requirements, including: registration as an investment company with the SEC; adoption of a specific form of corporate structure; and reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations that we are currently not subject to. We do not believe that our anticipated principal activities will subject us to the Investment Company Act. The proceeds held in the trust account may be invested by the trustee only in U.S. government treasury bills with a maturity of 185 days or less or in money market funds investing solely in U.S. Treasuries and meeting certain conditions under Rule 2a-7 under the Investment Company Act. Because the investment of the proceeds will be restricted to these instruments, we believe we will meet the requirements for the exemption provided in Rule 3a-1 promulgated under the Investment Company Act. If we were deemed to be subject to the Investment Company Act, compliance with these additional regulatory burdens would require additional expenses for which we have not allotted funds and may hinder our ability to complete a business combination. If we have not completed our initial business combination within the required time period, our public stockholders may receive only approximately $10.20 per share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. Changes in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, including our ability to negotiate and complete our initial business combination, and results of operations. We are subject to laws and regulations enacted by national, regional and local governments. In particular, we will be required to comply with certain SEC and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations may be difficult, time consuming and costly. Those laws and regulations and their interpretation 41 and application may also change from time to time and those changes could have a material adverse effect on our business, investments and results of operations. In addition, a failure to comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business, including our ability to negotiate and complete our initial business combination, and results of operations. If we have not completed our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) of the closing of this offering, our public stockholders may be forced to wait beyond such 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) before redemption from our trust account. If we have not completed our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, we will distribute the aggregate amount then on deposit in the trust account, including interest (less up to $100,000 of interest to pay dissolution expenses and which interest shall be net of taxes payable), pro rata to our public stockholders by way of redemption and cease all operations except for the purposes of winding up of our affairs, as further described herein. Any redemption of public stockholders from the trust account shall be effected automatically by function of our amended and restated certificate of incorporation prior to any voluntary winding up. If we are required to windup, liquidate the trust account and distribute such amount therein, pro rata, to our public stockholders, as part of any liquidation process, such winding up, liquidation and distribution must comply with the applicable provisions of the DGCL. In that case, investors may be forced to wait beyond the initial 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) before the redemption proceeds of our trust account become available to them and they receive the return of their pro rata portion of the proceeds from our trust account. We have no obligation to return funds to investors prior to the date of our redemption or liquidation unless, prior thereto, we consummate our initial business combination or amend certain provisions of our amended and restated certificate of incorporation and then only in cases where investors have properly sought to redeem their shares of Class A common stock. Only upon our redemption or any liquidation will public stockholders be entitled to distributions if we have not completed our initial business combination within the required time period and do not amend certain provisions of our amended and restated certificate of incorporation prior thereto. We may not hold an annual meeting until after the consummation of our initial business combination. Our public stockholders will not have the right to elect or remove directors prior to the consummation of our initial business combination. We may not hold an annual meeting of stockholders until after we consummate a business combination (unless required by the NYSE), and thus may not be in compliance with Section 211(b) of the DGCL, which requires an annual meeting of stockholders be held for the purposes of electing directors in accordance with a company s bylaws unless such election is made by written consent in lieu of such a meeting. Therefore, if our stockholders want us to hold an annual meeting prior to our consummation of a business combination, they may attempt to force us to hold one by submitting an application to the Delaware Court of Chancery in accordance with Section 211(c) of the DGCL. In addition, as holders of our Class A common stock, our public stockholders will not have the right to vote on the appointment of directors prior to consummation of our initial business combination. In addition, holders of a majority of our founder shares may remove a member of the board of directors for any reason. The grant of registration rights to our initial stockholders and their permitted transferees may make it more difficult to complete our initial business combination, and the future exercise of such rights may adversely affect the market price of our shares of Class A common stock. Pursuant to an agreement to be entered into on or prior to the closing of this offering, at or after the time of our initial business combination, our initial stockholders and their permitted transferees can demand that we register the resale of their shares of Class A common stock into which founder shares are convertible, the private placement warrants and the shares of Class A common stock issuable upon exercise of the private placement warrants and warrants that may be issued upon conversion of working capital loans or extension loans, and the shares of Class A common stock issuable upon conversion of such warrants. The registration rights will be exercisable with respect to the founder shares, the private placement warrants and the shares of Class A common stock issuable upon exercise 42 of such private placement warrants. We will bear the cost of registering these securities. The registration and availability of such a significant number of securities for trading in the public market may have an adverse effect on the market price of our shares of Class A common stock. In addition, the existence of the registration rights may make our initial business combination more costly or difficult to conclude. This is because the stockholders of the target business may increase the equity stake they seek in the combined entity or ask for more cash consideration to offset the negative impact on the market price of our shares of Class A common stock that is expected when the common stock owned by our initial stockholders or their permitted transferees, our private placement warrants or warrants issued in connection with working capital loans or extension loans are registered for resale. Because we are not limited to a particular industry or any specific target businesses with which to pursue our initial business combination, you will be unable to ascertain the merits or risks of any particular target business s operations. We may seek to complete a business combination with an operating company of any size (subject to our satisfaction of the 80% of net assets test) and in any industry, sector or geography. However, we will not, under our amended and restated certificate of incorporation, be permitted to effectuate our initial business combination solely with another blank check company or similar company with nominal operations. Because we have not yet selected or approached any specific target business with respect to a business combination, there is no basis to evaluate the possible merits or risks of any particular target business s operations, results of operations, cash flows, liquidity, financial condition or prospects. To the extent we complete our initial business combination, we may be affected by numerous risks inherent in the business operations with which we combine. For example, if we combine with a financially unstable business or an entity lacking an established record of sales or earnings, we may be affected by the risks inherent in the business and operations of a financially unstable or development stage entity. Although our directors and officers will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all of the significant risk factors or that we will have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability to control or reduce the chances that those risks will adversely impact a target business. We also cannot assure you that an investment in our units will not ultimately prove to be less favorable to our investors than a direct investment, if such opportunity were available, in a business combination target. Accordingly, any stockholder or warrant holder who chooses to remain a stockholder or warrant holder, respectively, following our initial business combination could suffer a reduction in the value of their securities. Such stockholders and warrant holders are unlikely to have a remedy for such reduction in value. If we acquire a company in the healthcare or healthcare services industry, our future operations may be subject to risks associated with such sectors. While we may pursue an initial business combination target in any stage of its corporate evolution or in any industry, sector or geographic location, we intend to focus our search across certain emerging themes in the healthcare market. We intend to concentrate our efforts in identifying companies that offer innovative software, hardware, products, operations or services to the healthcare industry. Because we have not yet identified or approached any specific target business, we cannot provide specific risks of any initial business combination. However, risks inherent in investments in this sector may include, but are not limited to, the following: adverse changes in international, national, regional or local economic, demographic and market conditions; competition from other healthcare companies and businesses; the ability to develop successful new products or improve existing ones; the disruption or failure of our networks, systems, platform or technology that frustrate or thwart our users ability to access our products and services, which may cause our users, advertisers, and partners to cut back on or stop using our products and services altogether, which could harm our business; malware, viruses, hacking and phishing attacks, spamming, and improper or illegal use of our products, which could harm our business and reputation; litigation and other legal proceedings; 43 the ability to attract and retain highly skilled employees; environmental risks; and civil unrest, labor strikes, acts of God, including earthquakes, floods and other natural disasters and acts of war or terrorism, which may result in uninsured losses. Any of the foregoing could have an adverse impact on our operations following an initial business combination. However, our efforts in identifying prospective target businesses will not be limited to healthcare companies. Accordingly, if we acquire a target business in another industry, we will be subject to risks associated with such industry, which may or may not be different than the risks listed above. Although we have identified general criteria and guidelines that we believe are important in evaluating prospective target businesses, we may enter into our initial business combination with a target that does not meet such criteria and guidelines, and as a result, the target business with which we enter into our initial business combination may not have attributes entirely consistent with our general criteria and guidelines. Although we have identified general criteria and guidelines for evaluating prospective target businesses, it is possible that a target business with which we enter into our initial business combination will not have all of these positive attributes. If we complete our initial business combination with a target that does not meet some or all of these criteria and guidelines, such combination may not be as successful as a combination with a business that does meet all of our general criteria and guidelines. In addition, if we announce a prospective business combination with a target that does not meet our general criteria and guidelines, a greater number of stockholders may exercise their redemption rights, which may make it difficult for us to meet any closing condition with a target business that requires us to have a minimum net worth or a certain amount of cash. In addition, if stockholder approval of the transaction is required by applicable law or stock exchange listing requirements, or we decide to obtain stockholder approval for business or other reasons, it may be more difficult for us to attain stockholder approval of our initial business combination if the target business does not meet our general criteria and guidelines. If we have not completed our initial business combination within the required time period, our public stockholders may receive only approximately $10.20 per share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. We may seek acquisition opportunities with an early stage company, a financially unstable business or an entity lacking an established record of revenue or earnings. To the extent we complete our initial business combination with an early stage company, a financially unstable business or an entity lacking an established record of sales or earnings, we may be affected by numerous risks inherent in the operations of the business with which we combine. These risks include investing in a business without a proven business model and with limited historical financial data, volatile revenues or earnings, intense competition and difficulties in obtaining and retaining key personnel. Although our directors and officers will endeavor to evaluate the risks inherent in a particular target business, we may not be able to properly ascertain or assess all of the significant risk factors and we may not have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability to control or reduce the chances that those risks will adversely impact a target business. We are not required to obtain an opinion from an independent investment banking firm or from an independent accounting firm regarding fairness. Consequently, you may have no assurance from an independent source that the price we are paying for the business is fair to our company from a financial point of view. Unless we complete our initial business combination with an affiliated entity, we are not required to obtain an opinion that the price we are paying is fair to our company from a financial point of view. If no opinion is obtained, our stockholders will be relying on the judgment of our board of directors, who will determine fair market value based on standards generally accepted by the financial community. Such standards used will be disclosed in our tender offer documents or proxy solicitation materials, as applicable, related to our initial business combination. 44 We may issue additional shares of Class A common stock or preferred shares to complete our initial business combination or under an employee incentive plan after completion of our initial business combination. We may also issue shares of Class A common stock upon the conversion of the shares of Class B common stock at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions contained in our amended and restated certificate of incorporation. Any such issuances would dilute the interest of our stockholders and likely present other risks. Our amended and restated certificate of incorporation will authorize the issuance of up to 280,000,000 shares of Class A common stock, par value $0.0001 per share, 20,000,000 shares of Class B common stock, par value $0.0001 per share, and 1,000,000 shares of preferred stock, par value $0.0001 per share. Immediately after this offering, there will be 262,500,000 and 15,625,000 (assuming that the underwriters have not exercised their over-allotment option) authorized but unissued shares of Class A common stock and shares of Class B common stock, respectively, available for issuance, which amount does not take into account shares reserved for issuance upon exercise of outstanding warrants or upon conversion of the Class B common stock. Shares of Class B common stock are convertible into shares of Class A common stock, initially at a one-for-one ratio but subject to adjustment as set forth herein. Immediately after this offering, there will be no preferred shares issued and outstanding. We may issue a substantial number of additional shares of Class A common stock, and may issue preferred shares, in order to complete our initial business combination or under an employee incentive plan after completion of our initial business combination. We may also issue shares of Class A common stock to redeem the warrants as described in "Description of Securities — Redeemable Warrants — Public Stockholders Warrants — Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00" or upon conversion of the shares of Class B common stock at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions contained in our amended and restated certificate of incorporation . However, our amended and restated certificate of incorporation will provide, among other things, that prior to our initial business combination, we may not issue additional common stock that would entitle the holders thereof to (1) receive funds from the trust account or (2) vote as a class with our public shares on any initial business combination. The issuance of additional common stock or preferred shares: may significantly dilute the equity interest of investors in this offering, which dilution would increase if the anti-dilution provisions in the Class B common stock resulted in the issuance of shares of Class A common stock on a greater than one-to-one basis upon conversion of the shares of Class B common stock; may subordinate the rights of holders of common stock if preferred shares are issued with rights senior to those afforded our common stock; could cause a change of control if a substantial number of shares of our common stock are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present directors and officers; may have the effect of delaying or preventing a change of control of us by diluting the share ownership or voting rights of a person seeking to obtain control of us; may adversely affect prevailing market prices for our units, common stock and/or warrants; and may not result in adjustment to the exercise price of our warrants. Resources could be wasted in researching acquisitions that are not completed, which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. If we have not completed our initial business combination within the required time period, our public stockholders may receive only approximately $10.20 per share, or less than such amount in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. We anticipate that the investigation of each specific target business and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments will require substantial management time and attention and substantial costs for accountants, attorneys and others. If we decide not to complete a specific initial business combination, the costs incurred up to that point for the proposed transaction likely would not be 45 recoverable. Furthermore, if we reach an agreement relating to a specific target business, we may fail to complete our initial business combination for any number of reasons including those beyond our control. Any such event will result in a loss to us of the related costs incurred which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. If we have not completed our initial business combination within the required time period, our public stockholders may receive only approximately $10.20 per share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. We may have limited ability to assess the management of a prospective target business which, as a result, may affect our initial business combination with a target business whose management may not have the skills, qualifications or abilities to manage a public company. When evaluating the desirability of effecting our initial business combination with a prospective target business, our ability to assess the target business s management may be limited due to a lack of time, resources or information. Our assessment of the capabilities of the target s management, therefore, may prove to be incorrect and such management may lack the skills, qualifications or abilities we suspected. Should the target s management not possess the skills, qualifications or abilities necessary to manage a public company, the operations and profitability of the post-combination business may be negatively impacted. Accordingly, any stockholder or warrant holder who chooses to remain a stockholder or warrant holder, respectively, following our initial business combination could suffer a reduction in the value of their securities. Such stockholders and warrant holders are unlikely to have a remedy for such reduction in value. We may issue notes or other debt securities, or otherwise incur substantial debt, to complete a business combination, which may adversely affect our leverage and financial condition and thus negatively impact the value of our stockholders investment in us. Although we have no commitments as of the date of this prospectus to issue any notes or other debt securities, or to otherwise incur outstanding debt following this offering, we may choose to incur substantial debt to complete our initial business combination. We have agreed that we will not incur any indebtedness unless we have obtained from the lender a waiver of any right, title, interest or claim of any kind in or to the monies held in the trust account. As such, no issuance of debt will affect the per-share amount available for redemption from the trust account. Nevertheless, the incurrence of debt could have a variety of negative effects, including: default and foreclosure on our assets if our operating cash flows after an initial business combination are insufficient to repay our debt obligations; acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant; our immediate payment of all principal and accrued interest, if any, if the debt is payable on demand; our inability to obtain necessary additional financing if the debt contains covenants restricting our ability to obtain such financing while the debt is outstanding; our inability to pay dividends on our common stock; using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends on our common stock if declared, expenses, capital expenditures, acquisitions and other general corporate purposes; limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate; increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation; and limitations on our ability to borrow additional amounts for expenses, liquidity, capital expenditures, acquisitions, debt service requirements, execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt. 46 We may be able to complete only one business combination with the proceeds of this offering and the sale of the private placement warrants, which will cause us to be solely dependent on a single business which may have a limited number of products or services. This lack of diversification may negatively impact our operations and profitability. The net proceeds from this offering and the sale of the private placement warrants will provide us with $172,375,000 assuming no redemptions and after payment of $6,125,000 of deferred underwriting fees (or $198,231,250 assuming no redemptions and after payment of $7,043,750 of deferred underwriting fees if the underwriters over-allotment option is exercised in full), in each case, after estimated offering expenses of $750,000 and full spend of the working capital held outside the trust account that we may use to complete our initial business combination. We may effectuate our initial business combination with a single target business or multiple target businesses simultaneously or within a short period of time. However, we may not be able to effectuate our initial business combination with more than one target business because of various factors, including the existence of complex accounting issues and the requirement that we prepare and file pro forma financial statements with the SEC that present operating results and the financial condition of several target businesses as if they had been operated on a combined basis. By completing our initial business combination with only a single entity, our lack of diversification may subject us to numerous economic, competitive and regulatory risks. Further, we would not be able to diversify our operations or benefit from the possible spreading of risks or offsetting of losses, unlike other entities which may have the resources to complete several business combinations in different industries or different areas of a single industry. Accordingly, the prospects for our success may be: solely dependent upon the performance of a single business, property or asset; or dependent upon the development or market acceptance of a single or limited number of products, processes or services. This lack of diversification may subject us to numerous economic, competitive and regulatory risks, any or all of which may have a substantial adverse impact upon the particular industry in which we may operate subsequent to our initial business combination. We may attempt to simultaneously complete business combinations with multiple prospective targets, which may hinder our ability to complete our initial business combination and give rise to increased costs and risks that could negatively impact our operations and profitability. If we determine to simultaneously acquire several businesses that are owned by different sellers, we will need for each of such sellers to agree that our purchase of its business is contingent on the simultaneous closings of the other business combinations, which may make it more difficult for us, and delay our ability, to complete our initial business combination. With multiple business combinations, we could also face additional risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence investigations (if there are multiple sellers) and the additional risks associated with the subsequent assimilation of the operations and services or products of the acquired companies in a single operating business. If we are unable to adequately address these risks, it could negatively impact our profitability and results of operations. We may attempt to complete our initial business combination with a private company about which little information is available, which may result in a business combination with a company that is not as profitable as we suspected, if at all. In pursuing our acquisition strategy, we may seek to effectuate our initial business combination with a privately held company. Very little public information generally exists about private companies, and we could be required to make our decision on whether to pursue a potential initial business combination on the basis of limited information, which may result in a business combination with a company that is not as profitable as we suspected, if at all. Our management may not be able to maintain control of a target business after our initial business combination. We cannot provide assurance that, upon loss of control of a target business, new management will possess the skills, qualifications or abilities necessary to profitably operate such business. We may structure our initial business combination so that the post-transaction company in which our public stockholders own shares will own less than 100% of the equity interests or assets of a target business, but we 47 will complete such business combination only if the post-transaction company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for us not to be required to register as an investment company under the Investment Company Act. We will not consider any transaction that does not meet such criteria. Even if the post-transaction company owns 50% or more of the voting securities of the target, our stockholders prior to our initial business combination may collectively own a minority interest in the post business combination company, depending on valuations ascribed to the target and us in our initial business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares of common stock in exchange for all of the issued and outstanding capital stock, shares or other equity securities of a target. In this case, we would acquire a 100% interest in the target. However, as a result of the issuance of a substantial number of new shares of common stock, our stockholders immediately prior to such transaction could own less than a majority of our issued and outstanding common stock subsequent to such transaction. In addition, other minority stockholders may subsequently combine their holdings resulting in a single person or group obtaining a larger share of the company s shares than we initially acquired. Accordingly, this may make it more likely that our management will not be able to maintain our control of the target business. We do not have a specified maximum redemption threshold. The absence of such a redemption threshold may make it possible for us to complete a business combination with which a substantial majority of our stockholders do not agree. Our amended and restated certificate of incorporation will not provide a specified maximum redemption threshold, except that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 following such redemptions, or any greater net tangible asset or cash requirement that may be contained in the agreement relating to our initial business combination. As a result, we may be able to complete our initial business combination even though a substantial majority of our public stockholders do not agree with the transaction and have redeemed their shares or, if we seek stockholder approval of our initial business combination and do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, have entered into privately negotiated agreements to sell their shares to our sponsor, directors, officers, advisors or any of their affiliates. In the event the aggregate cash consideration we would be required to pay for all public shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all common stock submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate business combination. In order to effectuate an initial business combination, blank check companies have, in the past, amended various provisions of their charters and modified governing instruments, including their warrant agreements. We cannot assure you that we will not seek to amend our amended and restated certificate of incorporation or governing instruments in a manner that will make it easier for us to complete our initial business combination that some of our stockholders may not support. In order to effectuate a business combination, special purpose acquisition companies have, in the recent past, amended various provisions of their charters and governing instruments, including their warrant agreements. For example, special purpose acquisition companies have amended the definition of business combination, increased redemption thresholds and extended the time to consummate an initial business combination and, with respect to their warrants, amended their warrant agreements to require the warrants to be exchanged for cash and/or other securities. Our amended and restated certificate of incorporation will provide that any of its provisions related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the sale of the private placement warrants into the trust account and not release such amounts except in specified circumstances) may be amended if approved by holders of at least 65% of our outstanding common stock who attend and vote in a stockholder meeting, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of at least 65% of our outstanding common stock. Amending our warrant agreement will require a vote of holders of at least 50% of the public warrants and, solely with respect to any amendment to the terms of the private placement warrants or any provision of the warrant agreement with respect to the private placement warrants, 50% of the number of the then outstanding private placement warrants. In all other instances, our amended and restated certificate of incorporation will provide that it may be amended by holders of a majority of our common stock, subject to applicable provisions of the DGCL or applicable stock exchange rules. 48 In addition, our amended and restated certificate of incorporation will require us to provide our public stockholders with the opportunity to redeem their public shares for cash if we propose an amendment to our amended and restated certificate of incorporation to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete an initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) of the closing of this offering or with respect to any other material provisions relating to Class A common stockholders rights or pre-initial business combination activity. To the extent any of such amendments would be deemed to fundamentally change the nature of the securities offered through this registration statement, we would register, or seek an exemption from registration for, the affected securities. We cannot assure you that we will not seek to amend our charter or governing instruments or extend the time to consummate an initial business combination in order to effectuate our initial business combination. Certain provisions of our amended and restated certificate of incorporation that relate to our pre-business combination activity (and corresponding provisions of the agreement governing the release of funds from our trust account) may be amended with the approval of holders of at least two-thirds of our common stock who attend and vote at an annual meeting, which is a lower amendment threshold than that of some other blank check companies. It may be easier for us, therefore, to amend our amended and restated certificate of incorporation and the trust agreement to facilitate the completion of an initial business combination that some of our stockholders may not support. Our amended and restated certificate of incorporation will provide that any of its provisions related to pre- business combination activity (including the requirement to deposit proceeds of this offering and the private placement of warrants into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein) may be amended if approved by holders of 65% of our common stock entitled to vote thereon and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of 65% of our common stock entitled to vote thereon. In all other instances, our amended and restated certificate of incorporation may be amended by holders of a majority of our outstanding common stock entitled to vote thereon, subject to applicable provisions of the DGCL or applicable stock exchange rules. Our initial stockholders, who will collectively beneficially own 20% of our common stock upon the closing of this offering (assuming they do not purchase any units in this offering), may participate in any vote to amend our amended and restated certificate of incorporation and/or trust agreement and will have the discretion to vote in any manner they choose. As a result, we may be able to amend the provisions of our amended and restated certificate of incorporation which govern our pre-business combination behavior more easily than some other special purpose acquisition companies, and this may increase our ability to complete a business combination with which you do not agree. Our stockholders may pursue remedies against us for any breach of our amended and restated certificate of incorporation. Our sponsor, officers, directors and director nominees have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering or with respect to any other material provisions relating to Class A common stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their Class A common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares. Our stockholders are not parties to, or third-party beneficiaries of, these agreements and, as a result, will not have the ability to pursue remedies against our sponsor, executive officers, directors or director nominees for any breach of these agreements. As a result, in the event of a breach, our stockholders would need to pursue a stockholder derivative action, subject to applicable law. We may be unable to obtain additional financing to complete our initial business combination or to fund the operations and growth of a target business, which could compel us to restructure or abandon a particular business combination. Although we believe that the net proceeds of this offering and the sale of the private placement warrants will be sufficient to allow us to complete our initial business combination, because we have not yet selected any target business we cannot ascertain the capital requirements for any particular transaction. If the net proceeds of this 49 offering and the sale of the private placement warrants prove to be insufficient, either because of the size of our initial business combination, the depletion of the available net proceeds in search of a target business, the obligation to redeem for cash a significant number of shares from stockholders who elect redemption in connection with our initial business combination or the terms of negotiated transactions to purchase shares in connection with our initial business combination, we may be required to seek additional financing or to abandon the proposed business combination. We cannot assure you that such financing will be available on acceptable terms, if at all. To the extent that additional financing proves to be unavailable when needed to complete our initial business combination, we would be compelled to either restructure the transaction or abandon that particular business combination and seek an alternative target business candidate. In addition, even if we do not need additional financing to complete our initial business combination, we may require such financing to fund the operations or growth of the target business. The failure to secure additional financing could have a material adverse effect on the continued development or growth of the target business. None of our directors, officers or stockholders is required to provide any financing to us in connection with or after our initial business combination. If we have not completed our initial business combination within the required time period, our public stockholders may receive only approximately $10.20 per share, or less in certain circumstances, on the liquidation of our trust account, and our warrants will expire worthless. Our initial stockholders will control the appointment of our board of directors until consummation of our initial business combination and will hold a substantial interest in us. As a result, they will appoint all of our directors prior to our initial business combination and may exert a substantial influence on actions requiring stockholder vote, potentially in a manner that you do not support. Upon the closing of this offering, our initial stockholders will own 20% of our issued and outstanding common stock (assuming they do not purchase any units in this offering). In addition, prior to our initial business combination, holders of the founder shares will have the right to appoint all of our directors and may remove members of the board of directors for any reason. Holders of our public shares will have no right to vote on the appointment of directors during such time. These provisions of our amended and restated certificate of incorporation may only be amended by approval of at least 90% of the shares of our Class B common stock voting. As a result, you will not have any influence over the appointment of directors prior to our initial business combination. Neither our initial stockholders nor, to our knowledge, any of our directors or officers, have any current intention to purchase additional securities, other than as disclosed in this prospectus. Factors that would be considered in making such additional purchases would include the current trading price of our shares of Class A common stock. In addition, as a result of their substantial ownership in our company, our initial stockholders may exert a substantial influence on other actions requiring a stockholder vote, potentially in a manner that you do not support, including amendments to our amended and restated certificate of incorporation and approval of major corporate transactions. If our initial stockholders purchase any shares of Class A common stock in this offering or in the aftermarket or in privately negotiated transactions, this would increase their influence over these actions. Accordingly, our initial stockholders will exert significant influence over actions requiring a stockholder vote at least until the completion of our initial business combination. Since our initial stockholders will have the right to vote on the election of directors, upon the listing of our shares on the NYSE, the NYSE may consider us to be a "controlled company" within the meaning of the NYSE rules and, as a result, we may qualify for exemptions from certain corporate governance requirements. After completion of this offering, our initial stockholders will have the right to vote on the election of directors. As a result, the NYSE may consider us to be a "controlled company" within the meaning of the NYSE corporate governance standards. Under the NYSE corporate governance standards, a company of which more than 50% of the voting power is held by an individual, group or another company is a "controlled company" and may elect not to comply with certain corporate governance requirements, including the requirements that: we have a board that includes a majority of "independent directors," as defined under the rules of the NYSE; we have a compensation committee of our board that is comprised entirely of independent directors with a written charter addressing the committee s purpose and responsibilities; and 50 we have a nominating and corporate governance committee of our board that is comprised entirely of independent directors with a written charter addressing the committee s purpose and responsibilities. We do not intend to utilize these exemptions and intend to comply with the corporate governance requirements of the NYSE, subject to applicable phase-in rules. However, if we determine in the future to utilize some or all of these exemptions, you will not have the same protections afforded to stockholders of companies that are subject to all of the NYSE corporate governance requirements. A provision of our warrant agreement may make it more difficult for us to consummate an initial business combination. Unlike most blank check companies, if (i) we issue additional common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at a Newly Issued Price of less than $9.20 per share of Class A common stock; (ii) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the completion of our initial business combination (net of redemptions), and (iii) the Market Value is below $9.20 per share, then the exercise price of the warrants will be adjusted to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger prices described below under "Description of Securities — Redeemable Warrants — Public Stockholders Warrants — Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00" and "Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00" will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. This may make it more difficult for us to consummate an initial business combination with a target business. Our warrants and founder shares may have an adverse effect on the market price of our shares of Class A common stock and make it more difficult to effectuate our initial business combination. We will be issuing warrants to purchase 8,750,000 shares of Class A common stock (or up to 10,062,500 shares of Class A common stock if the underwriters over-allotment option is exercised in full), at a price of $11.50 per whole share (subject to adjustment as provided herein), as part of the units offered by this prospectus and, simultaneously with the closing of this offering, we will be issuing in a private placement an aggregate of 9,700,000 (or 10,750,000 if the underwriters over-allotment option is exercised in full) private placement warrants, each exercisable to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment as provided herein. Our initial stockholders currently hold 5,031,250 shares of Class B common stock (up to 656,250 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised). The shares of Class B common stock are convertible into shares of Class A common stock on a one-for-one basis, subject to adjustment as set forth herein. In addition, if our sponsor, an affiliate of our sponsor or certain of our directors and officers make any working capital loans, up to $1,500,000 of such loans may be converted into warrants, at the price of $1.00 per warrant at the option of the lender. In addition, if we anticipate that we may not be able to consummate our initial business combination, we may extend the period of time to consummate a business combination as described in this prospectus. For a Paid Extension, our sponsor and its affiliates or designees are obligated to fund the trust account to extend the time for us to complete our initial business combination, but our sponsor and its affiliates will not be obligated to extend such time. Any such payments would be made in the form of a loan, which will be non-interest bearing and payable upon the consummation of our initial business combination. For each Paid Extension, up to $1,750,000, or $2,012,500 if the underwriters over-allotment option is exercised in full, of such loans to extend such period of time may be convertible into warrants of the post-business combination entity at a price of $1.00 per warrant at the option of the lender. Such warrants would be identical to the private placement warrants. To the extent we issue shares of Class A common stock to effectuate a business combination, the potential for the issuance of a substantial number of additional shares of Class A common stock upon exercise of these warrants or conversion rights could make us a less attractive acquisition vehicle to a target business. Any such issuance will increase the number of issued and outstanding shares of Class A common stock and reduce the value of the shares of Class A common stock issued to complete the business combination. Therefore, our warrants and founder shares may make it more difficult to effectuate a business combination or increase the cost of acquiring the target business. 51 The private placement warrants are identical to the warrants sold as part of the units in this offering except that, so long as they are held by our sponsor or its permitted transferees: (1) they will not be redeemable by us (except as described below under "Description of Securities — Redeemable Warrants — Public Redeemable Warrants — Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00"); (2) they (including the shares of Class A common stock issuable upon exercise of these warrants) may not, subject to certain limited exceptions, be transferred, assigned or sold by our sponsor until 30 days after the completion of our initial business combination; (3) they may be exercised by the holders on a cashless basis; and (4) they (including the common stock issuable upon exercise of these warrants) are entitled to registration rights. Because we must furnish our stockholders with target business financial statements, we may lose the ability to complete an otherwise advantageous initial business combination with some prospective target businesses. The federal proxy rules require that a proxy statement with respect to a vote on a business combination meeting certain financial significance tests include historical and/or pro forma financial statement disclosure in periodic reports. We will include the same financial statement disclosure in connection with our tender offer documents, whether or not they are required under the tender offer rules. These financial statements may be required to be prepared in accordance with, or be reconciled to, accounting principles generally accepted in the United States of America, or U.S. GAAP, or international financial reporting standards as issued by the International Accounting Standards Board, or IFRS, depending on the circumstances and the historical financial statements may be required to be audited in accordance with the standards of the Public Company Accounting Oversight Board (United States), or PCAOB. These financial statement requirements may limit the pool of potential target businesses we may acquire because some targets may be unable to provide such financial statements in time for us to disclose such financial statements in accordance with federal proxy rules and complete our initial business combination within the prescribed time frame. If our management team pursues a company with operations or opportunities outside of the United States for our initial business combination, we may face additional burdens in connection with investigating, agreeing to and completing such combination, and if we effect such initial business combination, we would be subject to a variety of additional risks that may negatively impact our operations. If our management team pursues a company with operations or opportunities outside of the United States for our initial business combination, we would be subject to risks associated with cross-border business combinations, including in connection with investigating, agreeing to and completing our initial business combination, conducting due diligence in a foreign market, having such transaction approved by any local governments, regulators or agencies and changes in the purchase price based on fluctuations in foreign exchange rates. If we effect our initial business combination with such a company, we would be subject to any special considerations or risks associated with companies operating in an international setting, including any of the following: costs and difficulties inherent in managing cross-border business operations and complying with commercial and legal requirements of overseas markets; rules and regulations regarding currency redemption; complex corporate withholding taxes on individuals; laws governing the manner in which future business combinations may be effected; tariffs and trade barriers; regulations related to customs and import/export matters; longer payment cycles; tax consequences, such as tax law changes, including termination or reduction of tax and other incentives that the applicable government provides to domestic companies, and variations in tax laws as compared to the United States; currency fluctuations and exchange controls; rates of inflation; 52 challenges in collecting accounts receivable; cultural and language differences; employment regulations; crime, strikes, riots, civil disturbances, terrorist attacks, natural disasters and wars; deterioration of political relations with the United States; obligatory military service by personnel; and government appropriation of assets. We may not be able to adequately address these additional risks. If we were unable to do so, we may be unable to complete such combination or, if we complete such combination, our operations might suffer, either of which may adversely impact our results of operations and financial condition. If our management following our initial business combination is unfamiliar with U.S. securities laws, they may have to expend time and resources becoming familiar with such laws, which could lead to various regulatory issues. Following our initial business combination, any or all of our management could resign from their positions as officers of the company, and the management of the target business at the time of the business combination could remain in place. Management of the target business may not be familiar with U.S. securities laws. If new management is unfamiliar with U.S. securities laws, they may have to expend time and resources becoming familiar with such laws. This could be expensive and time-consuming and could lead to various regulatory issues which may adversely affect our operations. After our initial business combination, our results of operations and prospects could be subject, to a significant extent, to the economic, political, social and government policies, developments and conditions in the country in which we operate. The economic, political and social conditions, as well as government policies, of the country in which our operations are located could affect our business. Economic growth could be uneven, both geographically and among various sectors of the economy and such growth may not be sustained in the future. If in the future such country s economy experiences a downturn or grows at a slower rate than expected, there may be less demand for spending in certain industries. A decrease in demand for spending in certain industries could materially and adversely affect our ability to find an attractive target business with which to consummate our initial business combination and if we effect our initial business combination, the ability of that target business to become profitable. The COVID-19 pandemic and the impact on businesses and debt and equity markets could have a material adverse effect on our search for an initial business combination, and any target business with which we ultimately consummate an initial business combination. The COVID-19 pandemic has resulted in a widespread health crisis that has adversely impacted the economies and financial markets worldwide, business operations and the conduct of commerce generally. There is no way of being certain how long these adverse impacts will last. The coronavirus, or other disease outbreaks, could have a material adverse effect on the business of any potential target business with which we consummate an initial business combination. Furthermore, we may be unable to complete an initial business combination if concerns relating to the coronavirus pandemic continue to restrict travel, limit the ability to have meetings with potential investors or the target company s personnel, vendors and services providers are unavailable to negotiate and consummate a transaction in a timely manner. The extent to which the coronavirus impacts our search for an initial business combination will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the coronavirus pandemic and the actions to contain the coronavirus or treat its impact, among others. If the disruptions posed by the coronavirus or other matters of global concern continue for an extensive period of time, it could have a material adverse effect on our ability to consummate an initial business combination, or the operations of a target business with which we ultimately consummate a business combination. 53 In addition, our ability to consummate an initial business combination may be dependent on the ability to raise equity and debt financing and the coronavirus pandemic and other related events could have a material adverse effect on our ability to raise adequate financing, including as a result of increased market volatility, decreased market liquidity and third-party financing being unavailable on terms acceptable to us or at all. Compliance obligations under the Sarbanes-Oxley Act may make it more difficult for us to effectuate our initial business combination, require substantial financial and management resources, and increase the time and costs of completing an acquisition. Section 404 of the Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls beginning with our Annual Report on Form 10-K for the year ending December 31, 2023. Only in the event we are deemed to be a large accelerated filer or an accelerated filer, and no longer qualify as an emerging growth company, will we be required to comply with the independent registered public accounting firm attestation requirement on our internal control over financial reporting. The fact that we are a blank check company makes compliance with the requirements of the Sarbanes-Oxley Act particularly burdensome on us as compared to other public companies because a target business with which we seek to complete our initial business combination may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of its internal controls. The development of the internal control of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such acquisition. We may issue our shares to investors in connection with our initial business combination at a price which is less than the prevailing market price of our shares at that time. In connection with our initial business combination, we may issue shares to investors in private placement transactions (so-called PIPE transactions) at a price of $10.20 per share or which approximates the per-share amounts in our trust account at such time, which is generally approximately $10.20. A purpose of such issuances may be to enable us to provide sufficient liquidity to the post-business combination entity. The price of the shares we issue may therefore be less, and potentially significantly less, than the market price for our shares at such time. Risks Relating to the Offering and our Securities We are a newly incorporated company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. We are a blank check company incorporated under the laws of the State of Delaware with no operating results, and we will not commence operations until obtaining funding through this offering. Because we lack an operating history, you have no basis upon which to evaluate our ability to achieve our business objective of completing our initial business combination. We have no plans, arrangements or understandings with any prospective target business concerning a business combination and may be unable to complete our initial business combination. If we fail to complete our initial business combination, we will never generate any operating revenues. You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. To liquidate your investment, therefore, you may be forced to sell your public shares and/or warrants, potentially at a loss. Our public stockholders will be entitled to receive funds from the trust account only upon the earliest to occur of: (1) our completion of an initial business combination, and then only in connection with those shares of Class A common stock that such stockholder properly elected to redeem, subject to the limitations described herein; (2) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering or (B) with respect to any other material provision relating to Class A common stockholders rights or pre-initial business combination activity; and (3) the redemption of our public shares if we have not completed an initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, 54 as described herein) from the closing of this offering, subject to applicable law. In no other circumstances will a stockholder have any right or interest of any kind to or in the trust account. Holders of warrants will not have any right to the proceeds held in the trust account with respect to the warrants. Accordingly, to liquidate your investment, you may be forced to sell your public shares and/or warrants, potentially at a loss. The NYSE may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities and subject us to additional trading restrictions. We intend to have our units listed on the NYSE on or promptly after the date of this prospectus and our Class A common stock and warrants listed on or promptly after their date of separation. Although after giving effect to this offering we expect to meet the minimum initial listing standards set forth in the NYSE listing standards, we cannot assure you that our securities will be, or will continue to be, listed on the NYSE in the future or prior to our initial business combination. In order to continue listing our securities on the NYSE prior to our initial business combination, we must maintain certain financial, distribution and stock price levels. In general, we must maintain a minimum of 300 public holders. Additionally, in connection with our initial business combination, we will be required to demonstrate compliance with the NYSE s initial listing requirements, which are more rigorous than the NYSE s continued listing requirements, in order to continue to maintain the listing of our securities on the NYSE. For instance, our share price would generally be required to be at least $4.00 per share and we would be required to have a minimum of 400 round lot holders. We cannot assure you that we will be able to meet those initial listing requirements at that time. If the NYSE delists any of our securities from trading on its exchange and we are not able to list our securities on another national securities exchange, we expect such securities could be quoted on an over-the-counter market. If this were to occur, we could face significant material adverse consequences, including: a limited availability of market quotations for our securities; reduced liquidity for our securities; a determination that our shares of Class A common stock are a "penny stock" which will require brokers trading in our Class A common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities; a limited amount of news and analyst coverage; and a decreased ability to issue additional securities or obtain additional financing in the future. The National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as "covered securities." Because we expect that our units and eventually our Class A common stock and warrants will be listed on the NYSE, our units, Class A common stock and warrants will qualify as covered securities under such statute. Although the states are preempted from regulating the sale of covered securities, the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. While we are not aware of a state having used these powers to prohibit or restrict the sale of securities issued by blank check companies, other than the State of Idaho, certain state securities regulators view blank check companies unfavorably and might use these powers, or threaten to use these powers, to hinder the sale of securities of blank check companies in their states. Further, if we were no longer listed on the NYSE, our securities would not qualify as covered securities under such statute and we would be subject to regulation in each state in which we offer our securities. You will not be entitled to protections normally afforded to investors of many other blank check companies. Since the net proceeds of this offering and the sale of the private placement warrants are intended to be used to complete an initial business combination with a target business that has not been selected, we may be deemed to be a "blank check" company under the U.S. securities laws. However, because we will have net tangible assets in excess of $5,000,000 upon the successful completion of this offering and the sale of the private placement warrants and will file a Current Report on Form 8-K, including an audited balance sheet of the company demonstrating this fact, we are exempt from rules promulgated by the SEC to protect investors in blank check companies, such as Rule 419. 55 Accordingly, investors will not be afforded the benefits or protections of those rules. Among other things, this means our units will be immediately tradable and we will have a longer period of time to complete our initial business combination than do companies subject to Rule 419. Moreover, if this offering were subject to Rule 419, that rule would prohibit the release of any interest earned on funds held in the trust account to us unless and until the funds in the trust account were released to us in connection with our completion of an initial business combination. For a more detailed comparison of our offering to offerings that comply with Rule 419, please see "Proposed Business — Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419." Our independent registered public accounting firm s report contains an explanatory paragraph that expresses substantial doubt about our ability to continue as a "going concern." As of September 30, 2021, we had $12,500 in cash and negative working capital of $380,908. Further, we expect to incur significant costs in pursuit of our acquisition plans. Management s plans to address this need for capital through this offering are discussed in the section of this prospectus titled "Management s Discussion and Analysis of Financial Condition and Results of Operations." Our plans to raise capital and to consummate our initial business combination may not be successful. These factors, among others, raise substantial doubt about our ability to continue as a going concern. The financial statements contained elsewhere in this prospectus do not include any adjustments that might result from our inability to consummate this offering or our inability to continue as a going concern. The nominal purchase price paid by our sponsor for the founder shares may significantly dilute the implied value of your public shares in the event we complete an initial business combination. In addition, the value of the sponsor s founder shares will be significantly greater than the amount our sponsor paid to purchase such shares in the event we complete an initial business combination, even if the business combination causes the trading price of our Class A common stock to materially decline. Our sponsor has committed to invest an aggregate of $9,725,000 in us in connection with this offering, comprised of the $25,000 purchase price for the founder shares and the $9,700,000 purchase price for the private placement warrants. We are offering our units to the public at an offering price of $10.00 per unit, and the amount in our trust account is initially anticipated to be $10.20 per public share, implying an initial value of $10.20 per public share. However, because the sponsor paid only a nominal purchase price of approximately $0.005 per share for the founder shares, the value of your public shares may be significantly diluted as a result of the automatic conversion of our sponsor s founder shares into shares of Class A common stock upon our completion of an initial business combination. The following table shows the public stockholders and our sponsor s investment per share and how these compare to the implied value of one share of Class A common stock upon the completion of our initial business combination. The following table assumes that (i) our valuation is $178,500,000 (which is the amount we would have in the trust account for our initial business combination assuming the underwriters overallotment option is not exercised), (ii) no interest is earned on the funds held in the trust account, (iii) no public shares are redeemed in connection with our initial business combination and (iv) all founder shares are held by our initial stockholders upon completion of our initial business combination, and does not take into account other potential impacts on our valuation at the time of the initial business combination such as (A) the value of our public and private placement warrants, (B) the trading price of our Class A common stock, (iii) the initial business combination transaction costs (including payment of $6,125,000 of deferred underwriting commissions), (iv) any equity issued or cash paid to the target s sellers, (v) any equity issued to other third party investors, or (vi) the target s business itself. Shares of Class A common stock held by public stockholders 17,500,000 shares Shares of Class B common stock held by our sponsor 4,375,000 shares Total shares of common stock 21,875,000 shares Total funds in trust at the initial business combination $ 178,500,000 Public stockholders investment per share of Class A common stock(1) $ 10.00 Our sponsor s investment per share of Class B common stock(2) $ 2.22 Implied value per share of Class A common stock upon the initial business combination(3) $ 8.16 ____________ (1) While the public stockholders investment is in both the public shares and the public warrants, for purposes of this table the full investment amount is ascribed to the public shares only. 56 (2) The sponsor s total investment in the equity of the company, inclusive of the founder shares and the sponsor s $9,700,000 investment in the private placement warrants, is $9,725,000. For purposes of this table, the full investment amount is ascribed to the founder shares only. (3) All founder shares held by our sponsor would automatically convert into Class A common stock upon completion of our initial business combination. Based on these assumptions, each share of Class A common stock would have an implied value of $8.16 per share upon completion of our initial business combination, representing a 20.0% decrease from the initial implied value of $10.20 per public share. While the implied value of $8.16 per share of Class A common stock upon completion of our initial business combination would represent a dilution to our public stockholders, this would represent a significant increase in value for our sponsor relative to the price it paid for each founder share. At $8.16 per share of Class A common stock, the 4,375,000 shares of Class A common stock that the sponsor would own upon completion of our initial business combination (after automatic conversion of the sponsor s 4,375,000 founder shares) would have an aggregate implied value of $35,700,000. As a result, even if the trading price of our Class A common stock significantly declines, the value of the founder shares held by our sponsor will be significantly greater than the amount our sponsor paid to purchase such shares. In addition, our sponsor could potentially recoup its entire investment in our company even if the trading price of our Class A common stock after the initial business combination is as low as $2.22 per share. As a result, our sponsor is likely to earn a substantial profit on its investment in us upon disposition of its Class A common stock even if the trading price of our Class A common stock declines after we complete our initial business combination. Our sponsor may therefore be economically incentivized to complete an initial business combination with a riskier, weaker-performing or less-established target business than would be the case if our sponsor had paid the same per share price for the founder shares as our public stockholders paid for their public shares. This dilution would increase to the extent that the anti-dilution provisions of the founder shares result in the issuance of Class A common stock on a greater than one-to-one basis upon conversion of the founder shares at the time of our initial business combination and would become exacerbated to the extent that public stockholders seek redemptions from the trust for their public shares. In addition, because of the anti-dilution protection in the founder shares, any equity or equity-linked securities issued in connection with our initial business combination would be disproportionately dilutive to our Class A common stock. An investment in the units may result in uncertain or adverse U.S. federal income tax consequences. An investment in the units may result in uncertain U.S. federal income tax consequences. For instance, because there are no authorities that directly address instruments similar to the units, the allocation an investor makes with respect to the purchase price of a unit between the share of Class A common stock and the one-half of one redeemable warrant to purchase one share of our Class A common stock included in each unit could be challenged by the U.S. Internal Revenue Service ("IRS") or the courts. Furthermore, the U.S. federal income tax consequences of a cashless exercise of warrants is unclear under current law and may be treated in part as a taxable exchange. In addition, an adjustment to the exercise price of the warrants could give rise to dividend income to investors without a corresponding payment of cash. Finally, it is unclear whether the redemption rights with respect to our shares of common stock suspend the running of a U.S. holder s holding period for purposes of determining whether any gain or loss realized by such holder on the sale or exchange of common stock is long-term capital gain or loss and for determining whether any dividend we pay would be considered "qualified dividends" for U.S. federal income tax purposes. See the section titled "U.S. Federal Income Tax Considerations" for a summary of the material U.S. federal income tax considerations applicable to an investment in our securities. Prospective investors are urged to consult their tax advisors with respect to these and other tax consequences applicable to their specific circumstances when purchasing, holding or disposing of our securities. The securities in which we invest the funds held in the trust account could bear a negative rate of interest, which could reduce the value of the assets held in trust such that the per-share redemption amount received by public stockholders may be less than $10.20 per share. The proceeds held in the trust account will be invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act, which invest only in direct U.S. government treasury obligations. While short-term U.S. government treasury obligations currently yield a positive rate of interest, they have briefly yielded negative interest rates in recent years. Central banks in Europe and Japan pursued interest rates below zero in recent years, and the Open 57 Market Committee of the Federal Reserve has not ruled out the possibility that it may in the future adopt similar policies in the United States. In the event that we are unable to complete our initial business combination or make certain amendments to our amended and restated certificate of incorporation, our public stockholders are entitled to receive their pro-rata share of the proceeds held in the trust account, plus any interest income, net of taxes paid or payable (less, in the case we are unable to complete our initial business combination, $100,000 of interest). Negative interest rates could reduce the value of the assets held in trust such that the per-share redemption amount received by public stockholders may be less than $10.20 per share. If, after we distribute the proceeds in the trust account to our public stockholders, we file a winding-up or bankruptcy or insolvency petition or an involuntary winding-up or bankruptcy or insolvency petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and the members of our board of directors may be viewed as having breached their fiduciary duties to our creditors, thereby exposing the members of our board of directors and us to claims of punitive damages. If, after we distribute the proceeds in the trust account to our public stockholders, we file a winding-up or bankruptcy or insolvency petition or an involuntary winding-up or bankruptcy or insolvency petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or insolvency laws as a voidable performance. As a result, a liquidator could seek to recover some or all amounts received by our stockholders. In addition, our board of directors may be viewed as having breached its fiduciary duty to our creditors and/or having acted in bad faith by paying public stockholders from the trust account prior to addressing the claims of creditors, thereby exposing itself and us to claims of punitive damages. If, before distributing the proceeds in the trust account to our public stockholders, we file a winding-up or bankruptcy or insolvency petition or an involuntary winding-up or bankruptcy or insolvency petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our stockholders and the per-share amount that would otherwise be received by our stockholders in connection with our liquidation may be reduced. If, before distributing the proceeds in the trust account to our public stockholders, we file a winding-up or bankruptcy or insolvency petition or an involuntary winding-up or bankruptcy or insolvency petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable insolvency law, and may be included in our liquidation estate and subject to the claims of third parties with priority over the claims of our stockholders. To the extent any liquidation claims deplete the trust account, the per-share amount that would otherwise be received by our stockholders in connection with our liquidation would be reduced. Our directors may decide not to enforce the indemnification obligations of our sponsor, resulting in a reduction in the amount of funds in the trust account available for distribution to our public stockholders. In the event that the proceeds in the trust account are reduced below the lesser of (1) $10.20 per public share or (2) such lesser amount per share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of interest which may be withdrawn to pay taxes, and our sponsor asserts that it is unable to satisfy its obligations or that it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take legal action against our sponsor to enforce its indemnification obligations. While we currently expect that our independent directors would take legal action on our behalf against our sponsor to enforce its indemnification obligations to us, it is possible that our independent directors in exercising their business judgment may choose not to do so in any particular instance. If our independent directors choose not to enforce these indemnification obligations, the amount of funds in the trust account available for distribution to our public stockholders may be reduced below $10.20 per share. We are not registering the shares of Class A common stock issuable upon exercise of the warrants under the Securities Act or any state securities laws at this time, and such registration may not be in place when an investor desires to exercise warrants, thus precluding such investor from being able to exercise its warrants except on a cashless basis and potentially causing such warrants to expire worthless. We are not registering the shares of Class A common stock issuable upon exercise of the warrants under the Securities Act or any state securities laws at this time. However, under the terms of the warrant agreement, we have agreed that, as soon as practicable, but in no event later than 15 business days after the closing of our initial 58 business combination, we will use our commercially reasonable efforts to file with the SEC a registration statement covering the issuance of such shares, and we will use our commercially reasonable efforts to cause the same to become effective within 60 business days after the closing of our initial business combination and to maintain the effectiveness of such registration statement and a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed. We cannot assure you that we will be able to do so if, for example, any facts or events arise which represent a fundamental change in the information set forth in the registration statement or prospectus, the financial statements contained or incorporated by reference therein are not current, complete or correct or the SEC issues a stop order. If the shares issuable upon exercise of the warrants are not registered under the Securities Act in accordance with the above requirements, we will be required to permit holders to exercise their warrants on a cashless basis, in which case, the number of shares of Class A common stock that you will receive upon cashless exercise will be based on a formula subject to a maximum amount of shares equal to 0.361 shares of Class A common stock per warrant (subject to adjustment). However, no warrant will be exercisable for cash or on a cashless basis, and we will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption from registration is available. Notwithstanding the above, if our shares of Class A common stock are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a "covered security" under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a "cashless basis" in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, but we will use our commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. In no event will we be required to net cash settle any warrant, or issue securities or other compensation in exchange for the warrants in the event that we are unable to register or qualify the shares underlying the warrants under applicable state securities laws and no exemption is available. If the issuance of the shares upon exercise of the warrants is not so registered or qualified or exempt from registration or qualification, the holder of such warrant shall not be entitled to exercise such warrant and such warrant may have no value and expire worthless. In such event, holders who acquired their warrants as part of a purchase of units will have paid the full unit purchase price solely for the shares of Class A common stock included in the units. There may be a circumstance where an exemption from registration exists for holders of our private placement warrants to exercise their warrants while a corresponding exemption does not exist for holders of the public warrants included as part of units sold in this offering. In such an instance, our sponsor and its permitted transferees (which may include our directors and executive officers) would be able to exercise their warrants and sell the common stock underlying their warrants while holders of our public warrants would not be able to exercise their warrants and sell the underlying common stock. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying shares of Class A common stock for sale under all applicable state securities laws. As a result, we may redeem the warrants as set forth above even if the holders are otherwise unable to exercise their warrants. Our sponsor paid an aggregate of $25,000, or approximately $0.005 per founder share, and, accordingly, you will experience immediate and substantial dilution upon the purchase of our shares of Class A common stock. The difference between the public offering price per share (allocating all of the unit purchase price to the common stock and none to the warrant included in the unit) and the pro forma net tangible book value per share of our Class A common stock after this offering constitutes the dilution to you and the other investors in this offering. Our sponsor acquired the founder shares at a nominal price, significantly contributing to this dilution. Upon the closing of this offering, and assuming no value is ascribed to the warrants included in the units, you and the other public stockholders will incur an immediate and substantial dilution of approximately 92.9% (or $9.29 per share, assuming no exercise of the underwriters over-allotment option), the difference between the pro forma net tangible book value per share of $0.71 and the initial offering price of $10.00 per unit. This dilution would increase to the extent that the anti-dilution provisions of the Class B common stock result in the issuance of shares of Class A common stock on a greater than one-to-one basis upon conversion of the shares of Class B common stock at the time of our initial business combination and would become exacerbated to the extent that public stockholders seek redemptions from the trust. In addition, because of the anti-dilution protection in the founder shares, any equity or equity-linked securities issued in connection with our initial business combination would be disproportionately dilutive to our shares of Class A common stock. 59 We may amend the terms of the warrants in a manner that may be adverse to holders of public warrants with the approval by the holders of at least 50% of the then outstanding public warrants. Our warrants will be issued in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. The warrant agreement provides that the terms of the warrants may be amended without the consent of any holder to cure any ambiguity or correct any defective provision, but requires the approval by the holders of at least 50% of the then outstanding public warrants to make any change that adversely affects the interests of the registered holders of public warrants. Accordingly, we may amend the terms of the public warrants in a manner adverse to a holder if holders of at least 50% of the then outstanding public warrants approve of such amendment and, solely with respect to any amendment to the terms of the private placement warrants or any provision of the warrant agreement with respect to the private placement warrants, 50% of the number of the then-outstanding private placement warrants. Although our ability to amend the terms of the public warrants with the consent of at least 50% of the then outstanding public warrants is unlimited, examples of such amendments could be amendments to, among other things, increase the exercise price of the warrants, shorten the exercise period or decrease the number of common stock purchasable upon exercise of a warrant. Our warrant agreement will designate the courts of the State of New York or the United States District Court for the Southern District of New York as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by holders of our warrants, which could limit the ability of warrant holders to obtain a favorable judicial forum for disputes with our company. Our warrant agreement will provide that, subject to applicable law, (i) any action, proceeding or claim against us arising out of or relating in any way to the warrant agreement, including under the Securities Act, will be brought and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and (ii) that we irrevocably submit to such jurisdiction, which jurisdiction shall be the exclusive forum for any such action, proceeding or claim. We will waive any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum. Notwithstanding the foregoing, these provisions of the warrant agreement will not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim for which the federal district courts of the United States of America are the sole and exclusive forum. Any person or entity purchasing or otherwise acquiring any interest in any of our warrants shall be deemed to have notice of and to have consented to the forum provisions in our warrant agreement. If any action, the subject matter of which is within the scope the forum provisions of the warrant agreement, is filed in a court other than a court of the State of New York or the United States District Court for the Southern District of New York (a "foreign action") in the name of any holder of our warrants, such holder shall be deemed to have consented to: (x) the personal jurisdiction of the state and federal courts located in the State of New York in connection with any action brought in any such court to enforce the forum provisions (an "enforcement action"), and (y) having service of process made upon such warrant holder in any such enforcement action by service upon such warrant holder s counsel in the foreign action as agent for such warrant holder. This choice-of-forum provision may limit a warrant holder s ability to bring a claim in a judicial forum that it finds favorable for disputes with our company, which may discourage such lawsuits. In addition, this choice-of-forum provision may result in our warrant holders incurring increased costs to bring an action, proceeding or claim due to, but not limited to, the warrant holder s physical location or knowledge of the applicable laws, when the courts of the State of New York or the United States District Court for the Southern District of New York is the exclusive forum. Alternatively, if a court were to find this provision of our warrant agreement inapplicable or unenforceable with respect to one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could materially and adversely affect our business, financial condition and results of operations and result in a diversion of the time and resources of our management and board of directors. 60 We may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless. We have the ability to redeem outstanding warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant if, among other things, the last reported sale price of our shares of Class A common stock equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading "Description of Securities — Redeemable Warrants — Public Stockholders Warrants — Anti-dilution Adjustments") for any 20 trading days within a 30 trading-day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. As a result, we may redeem the public warrants as set forth above even if the holders are otherwise unable to exercise the warrants. Redemption of the outstanding warrants could force you to: (1) exercise your warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so; (2) sell your warrants at the then-current market price when you might otherwise wish to hold your warrants; or (3) accept the nominal redemption price which, at the time the outstanding warrants are called for redemption, we expect would be substantially less than the market value of your warrants. None of the private placement warrants will be redeemable by us (except as described under "Description of Securities — Redeemable Warrants — Public Stockholders Warrants — Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00") so long as they are held by our sponsor or its permitted transferees. In addition, we have the ability to redeem outstanding warrants commencing ninety days after they become exercisable and prior to their expiration, at a price of $0.10 per warrant if, among other things, the last reported sale price of our shares of Class A common stock equals or exceeds $10.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading "Description of Securities — Redeemable Warrants — Public Stockholders Warrants — Anti-dilution Adjustments") for any 20 trading days within the 30-trading day period ending three trading days before we send the notice of redemption to the warrant holders. In such a case, the holders will be able to exercise their warrants for cash or on a cashless basis prior to redemption and receive that number of shares of Class A common stock determined by reference to the table set forth under "Description of Securities — Redeemable Warrants — Public Stockholders Warrants" based on the redemption date and the "fair market value" of our shares of Class A common stock except as otherwise described in "Description of Securities — Redeemable Warrants — Public Stockholders Warrants." Any such redemption may have similar consequences to a cash redemption described above. In addition, such redemption may occur at a time when the warrants are "out-of-the-money," in which case you would lose any potential embedded value from a subsequent increase in the value of the shares of Class A common stock had your warrants remained outstanding. The value received upon exercise of the warrants (1) may be less than the value the holders would have received if they had exercised their warrants at a later time where the underlying share price is higher and (2) may not compensate the holders for the value of the warrants, including because the number of common stock received is capped at 0.361 shares of Class A common stock per warrant (subject to adjustment) irrespective of the remaining life of the warrants. Because each unit contains one-half of one warrant and only a whole warrant may be exercised, the units may be worth less than units of other blank check companies. Each unit contains one-half of one warrant. Pursuant to the warrant agreement, no fractional warrants will be issued upon separation of the units, and only whole warrants will trade. This is different from other offerings similar to ours whose units include one share of Class A common stock and one whole warrant to purchase one share. We have established the components of the units in this way in order to reduce the dilutive effect of the warrants upon completion of a business combination since the warrants will be exercisable in the aggregate for one half of the number of shares compared to units that each contain a whole warrant to purchase one whole share, thus making us, we believe, a more attractive business combination partner for target businesses. Nevertheless, this unit structure may cause our units to be worth less than if they included a warrant to purchase one whole share. 61 The determination of the offering price of our units and the size of this offering is more arbitrary than the pricing of securities and size of an offering of an operating company in a particular industry. You may have less assurance, therefore, that the offering price of our units properly reflects the value of such units than you would have in a typical offering of an operating company. Prior to this offering there has been no public market for any of our securities. The public offering price of the units and the terms of the warrants were negotiated between us and the underwriters. In determining the size of this offering, management held customary organizational meetings with the underwriter, both prior to our inception and thereafter, with respect to the state of capital markets, generally, and the amount the underwriters believed they reasonably could raise on our behalf. Factors considered in determining the size of this offering, prices and terms of the units, including the shares of Class A common stock and warrants underlying the units, include: the history and prospects of companies whose principal business is the acquisition of other companies; prior offerings of those companies; our prospects for acquiring an operating business at attractive values; a review of debt to equity ratios in leveraged transactions; our capital structure; an assessment of our management and their experience in identifying operating companies; general conditions of the securities markets at the time of this offering; and other factors as were deemed relevant. Although these factors were considered, the determination of our offering price is more arbitrary than the pricing of securities of an operating company in a particular industry since we have no historical operations or financial results. There is currently no market for our securities and a market for our securities may not develop, which would adversely affect the liquidity and price of our securities. There is currently no market for our securities. Stockholders therefore have no access to information about prior market history on which to base their investment decision. Following this offering, the price of our securities may vary significantly due to one or more potential business combinations and general market or economic conditions, including as a result of the COVID-19 pandemic. Furthermore, an active trading market for our securities may never develop or, if developed, it may not be sustained. You may be unable to sell your securities unless a market can be established and sustained. Provisions in our amended and restated certificate of incorporation and Delaware law may inhibit a takeover of us, which could limit the price investors might be willing to pay in the future for our shares of Class A common stock and could entrench management. Our amended and restated certificate of incorporation will contain provisions that may discourage unsolicited takeover proposals that stockholders may consider to be in their best interests. These provisions include a staggered board of directors and the ability of the board of directors to designate the terms of and issue new series of preferred stock, which may make more difficult the removal of management and may discourage transactions that otherwise could involve payment of a premium over prevailing market prices for our securities. We are also subject to anti-takeover provisions under Delaware law, which could delay or prevent a change of control. Together these provisions may make the removal of management more difficult and may discourage transactions that otherwise could involve payment of a premium over prevailing market prices for our securities. 62 We are an emerging growth company and a smaller reporting company within the meaning of the Securities Act, and if we take advantage of certain exemptions from disclosure requirements available to emerging growth companies or smaller reporting companies, this could make our securities less attractive to investors and may make it more difficult to compare our performance with other public companies. We are an "emerging growth company" within the meaning of the Securities Act, as modified by the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. As a result, our stockholders may not have access to certain information they may deem important. We could be an emerging growth company for up to five years, although circumstances could cause us to lose that status earlier, including if the market value of our common stock held by non-affiliates equaled or exceeded $700 million as of the end of any second quarter of a fiscal year, in which case we would no longer be an emerging growth company as of the end of such fiscal year. We cannot predict whether investors will find our securities less attractive because we will rely on these exemptions. If some investors find our securities less attractive as a result of our reliance on these exemptions, the trading prices of our securities may be lower than they otherwise would be, there may be a less active trading market for our securities and the trading prices of our securities may be more volatile. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. We have elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. Additionally, we are a "smaller reporting company" as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates equals or exceeds $250 million as of the end of that year s second fiscal quarter, or (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates equaled or exceeded $700 million as of the end of that year s second fiscal quarter. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible. Cyber incidents or attacks directed at us could result in information theft, data corruption, operational disruption and/or financial loss. We depend on digital technologies, including information systems, infrastructure and cloud applications and services, including those of third parties with which we may deal. Sophisticated and deliberate attacks on, or security breaches in, our systems or infrastructure, or the systems or infrastructure of third parties or the cloud, could lead to corruption or misappropriation of our assets, proprietary information and sensitive or confidential data. As an early stage company without significant investments in data security protection, we may not be sufficiently protected against such occurrences. We may not have sufficient resources to adequately protect against, or to investigate and remediate any vulnerability to, cyber incidents. It is possible that any of these occurrences, or a combination of them, could have adverse consequences on our business and lead to financial loss. 63 Our warrants are expected to be accounted for as a warrant liability and will be recorded at fair value upon issuance with any changes in fair value each period reported in earnings, which may have an adverse effect on the market price of our securities or may make it more difficult for us to consummate an initial business combination. Upon consummation of this offering we will have 18,450,000 warrants outstanding (20,812,500 if the underwriters over-allotment option is exercised in full). We currently expect to account for these warrants as a warrant liability, which means that we will record at fair value upon issuance with any changes in fair value each period reported in earnings. The impact of changes in fair value on earnings may have an adverse effect on the market price of our securities. In addition, potential targets may seek a business combination partner that does not have warrants that are accounted for as a warrant liability, which may make it more difficult for us to consummate an initial business combination with a target business. Risks Relating to our Sponsor, Management Team and Board of Directors Past performance by our management team and their affiliates may not be indicative of future performance of an investment in the company. Information regarding performance by our management team and their affiliates is presented for informational purposes only. Past performance by our management team and their affiliates is not a guarantee either (1) that we will be able to identify a suitable candidate for our initial business combination or (2) of success with respect to any business combination we may consummate. You should not rely on the historical record of our management team or their affiliates or any related investment s performance as indicative of our future performance of an investment in the company or the returns the company will, or is likely to, generate going forward. Our ability to successfully effect our initial business combination and to be successful thereafter will be dependent upon the efforts of our key personnel, some of whom may join us following our initial business combination. The loss of our or a target s key personnel could negatively impact the operations and profitability of our post-combination business. Our ability to successfully effect our initial business combination is dependent upon the efforts of our key personnel. The role of our key personnel in the target business, however, cannot presently be ascertained. Although some of our key personnel may remain with the target business in senior management or advisory positions following our initial business combination, it is likely that some or all of the management of the target business will remain in place. While we intend to closely scrutinize any individuals we engage after our initial business combination, we cannot assure you that our assessment of these individuals will prove to be correct. These individuals may be unfamiliar with the requirements of operating a company regulated by the SEC, which could cause us to have to expend time and resources helping them become familiar with such requirements. In addition, the directors and officers of an acquisition candidate may resign upon completion of our initial business combination. The departure of a business combination target s key personnel could negatively impact the operations and profitability of our post-combination business. The role of an acquisition candidate s key personnel upon the completion of our initial business combination cannot be ascertained at this time. Although we contemplate that certain members of an acquisition candidate s management team will remain associated with the acquisition candidate following our initial business combination, it is possible that members of the management of an acquisition candidate will not wish to remain in place. The loss of key personnel could negatively impact the operations and profitability of our post-combination business. Our key personnel may negotiate employment or consulting agreements with a target business in connection with a particular business combination. These agreements may provide for them to receive compensation following our initial business combination and as a result, may cause them to have conflicts of interest in determining whether a particular business combination is the most advantageous. Our key personnel may be able to remain with the company after the completion of our initial business combination only if they are able to negotiate employment or consulting agreements in connection with the business combination. Such negotiations would take place simultaneously with the negotiation of the business combination and could 64 provide for such individuals to receive compensation in the form of cash payments and/or our securities for services they would render to us after the completion of our initial business combination. The personal and financial interests of such individuals may influence their motivation in identifying and selecting a target business, subject to his or her fiduciary duties. However, we believe the ability of such individuals to remain with us after the completion of our initial business combination will not be the determining factor in our decision as to whether or not we will proceed with any potential business combination. There is no certainty, however, that any of our key personnel will remain with us after the completion of our initial business combination or remain in senior management or advisory positions with us. The determination as to whether any of our key personnel will remain with us will be made at the time of our initial business combination. We are dependent upon our directors and officers and their departure could adversely affect our ability to operate. Our operations are dependent upon a relatively small group of individuals. We believe that our success depends on the continued service of our directors and officers, at least until we have completed our initial business combination. In addition, our directors and officers are not required to commit any specified amount of time to our affairs and, accordingly, will have conflicts of interest in allocating their time among various business activities, including identifying potential business combinations and monitoring the related due diligence. We do not have an employment agreement with, or key-man insurance on the life of, any of our directors or officers. The unexpected loss of the services of one or more of our directors or officers could have a detrimental effect on us. Our directors and officers will allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial business combination. Our directors and officers are not required to, and will not, commit their full time to our affairs, which may result in a conflict of interest in allocating their time between our operations and our search for a business combination and their other businesses. We do not intend to have any full-time employees prior to the completion of our initial business combination. Our officers are engaged in several other business endeavors for which they may be entitled to substantial compensation and our officers are not obligated to contribute any specific number of hours per week to our affairs. Certain of our independent directors also serve as officers and board members for other entities. If our officers and directors other business affairs require them to devote substantial amounts of time to such affairs in excess of their current commitment levels, it could limit their ability to devote time to our affairs, which may have a negative impact on our ability to complete our initial business combination. For a complete discussion of our officers and directors other business affairs, please see "Management — Directors, Director Nominees and Officers." We may engage our underwriter or one or more of its affiliates to provide additional services to us after this offering, which may include acting as M&A advisor in connection with an initial business combination or as arranger or underwriter of any associated debt financing. Our underwriter is entitled to receive deferred underwriting commissions that will be released from the trust account only upon a completion of an initial business combination. These financial incentives may cause them to have potential conflicts of interest in rendering any such additional services to us after this offering, including, for example, in connection with the sourcing and consummation of an initial business combination. We may engage our underwriter or one or more of its affiliates to provide additional services to us after this offering, including, for example, identifying potential targets, providing M&A advisory services, acting as an arranger or underwriter of any associated debt financing. We may pay our underwriter or one or more of its affiliates fair and reasonable fees or other compensation that would be determined at that time in an arm s length negotiation; provided that no agreement will be entered into with our underwriter or any of its affiliates and no fees or other compensation for such services will be paid to our underwriter or any of its affiliates prior to the date that is 60 days from the date of this prospectus, unless such payment would not be deemed underwriter s compensation in connection with this offering. Our underwriter is also entitled to receive deferred underwriting commissions that are conditioned on the completion of an initial business combination. Our underwriter s or its affiliates financial interests tied to the consummation of a business combination transaction may give rise to potential conflicts of interest in providing any such additional services to us, including potential conflicts of interest in connection with the sourcing and consummation of an initial business combination. 65 Since our initial stockholders will lose their entire investment in us if our initial business combination is not completed, a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination. Our sponsor paid $25,000, or approximately $0.005 per share, to cover certain of our offering and formation costs in exchange for an aggregate of 5,031,250 founder shares (up to 656,250 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised). Our initial stockholders will collectively own 20% of our issued and outstanding shares after this offering (assuming they do not purchase any units in this offering). If we increase or decrease the size of this offering, we will effect a capitalization or share repurchase or redemption or other appropriate mechanism, as applicable, immediately prior to the consummation of this offering in such amount as to maintain the number of founder shares at 20% of our issued and outstanding common stock upon the consummation of this offering. The founder shares will be worthless if we do not complete an initial business combination. In addition, our sponsor, has committed to purchase an aggregate of 9,700,000 (or 10,750,000 if the underwriters over-allotment option is exercised in full) private placement warrants, each exercisable for one share of Class A common stock, for a purchase price of $9,700,000 in the aggregate (or $10,750,000 in the aggregate if the underwriters over-allotment option is exercised in full), or $1.00 per warrant, that will also be worthless if we do not complete a business combination. Each private placement warrant may be exercised for one share of Class A common stock at a price of $11.50 per share, subject to adjustment as provided herein. The founder shares are identical to the common stock included in the units being sold in this offering except that: (1) prior to our initial business combination, only holders of the founder shares have the right to vote on the appointment of directors and holders of a majority of our founder shares may remove a member of the board of directors for any reason; (2) the founder shares are subject to certain transfer restrictions; (3) our initial stockholders, directors and officers have entered into a letter agreement with us, pursuant to which they have agreed to waive: (i) their redemption rights with respect to any founder shares and public shares held by them, as applicable, in connection with the completion of our initial business combination; (ii) their redemption rights with respect to any founder shares and public shares held by them in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering or (B) with respect to any other material provision relating to Class A common stockholders rights or pre-initial business combination activity; and (iii) their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame); (4) the founder shares will automatically convert into our shares of Class A common stock at the time of our initial business combination, or earlier at the option of the holder, on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described in more detail below; and (5) the founder shares are entitled to registration rights. If we submit our initial business combination to our public stockholders for a vote, our initial stockholders have agreed (and their permitted transferees will agree), pursuant to the terms of a letter agreement entered into with us, to vote their founder shares and any public shares held by them purchased during or after this offering in favor of our initial business combination. The personal and financial interests of our sponsor, directors and officers may influence their motivation in identifying and selecting a target business combination, completing an initial business combination and influencing the operation of the business following the initial business combination. This risk may become more acute as the 15-month deadline following the closing of this offering nears, which is the deadline for the completion of our initial business combination. In particular, because the founder shares were purchased at a purchase price of approximately $0.005 per share, the holders of our founder shares (including certain members of our management team that directly or indirectly own founder shares) could make a substantial profit after our initial business combination even if our public stockholders lose money on their investment as a result of a decrease in the post-combination value of their shares of Class A common stock (after accounting for any adjustments in connection with an exchange or 66 other transaction contemplated by the business combination). For example, a holder of 1,000 founder shares would have paid approximately $4.00 to purchase such shares. At the time of an initial business combination, such holder would be able to convert such founder shares into 1,000 shares of Class A common stock and would receive the same consideration in connection with our initial business combination as a public stockholder for the same number of shares of Class A common stock. If the trading price of our shares of Class A common stock on a post-business combination basis (after accounting for any adjustments in connection with an exchange or other transaction contemplated by the business combination) were to decrease to $5.00 per share of Class A common stock, such holder of our founder shares would obtain a profit of approximately $4,996 on account of the 1,000 founder shares that the holder had converted into shares of Class A common stock in connection with the initial business combination. By contrast, a public stockholder holding 1,000 shares of Class A common stock acquired as part of the units in this offering would lose approximately $5,000 (excluding the value of warrants included in the units) in connection with the same transaction. While we do not expect our board of directors to approve any amendment to or waiver of the letter agreement or registration rights agreement prior to our initial business combination, it may be possible that our board of directors, in exercising its business judgment and subject to its fiduciary duties, chooses to approve one or more amendments to or waivers of such agreements in connection with the consummation of our initial business combination. Any such amendments or waivers would not require approval from our stockholders, may result in the completion of our initial business combination that may not otherwise have been possible, and may have an adverse effect on the value of an investment in our securities. Certain of our directors and officers are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented. Following the completion of this offering and until we consummate our initial business combination, we intend to engage in the business of identifying and combining with one or more businesses. Our sponsor and directors and officers are, or may in the future become, affiliated with entities that are engaged in a business similar to our company. Our sponsor and directors and officers are also not prohibited from sponsoring, or otherwise becoming involved with, any other blank check companies prior to us completing our initial business combination. Our directors and officers also may become aware of business opportunities which may be appropriate for presentation to us and the other entities to which they owe certain fiduciary or contractual duties. Accordingly, they may have conflicts of interest in determining to which entity a particular business opportunity should be presented. These conflicts may not be resolved in our favor and a potential target business may be presented to other entities prior to its presentation to us, subject to his or her fiduciary duties. Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company and it is an opportunity that we are able to complete on a reasonable basis. For a complete discussion of our officers and directors business affiliations and the potential conflicts of interest that you should be aware of, please see "Management — Directors, Director Nominees and Officers," "Management — Conflicts of Interest" and "Certain Relationships and Related Party Transactions." Our directors, officers, security holders and their respective affiliates may have competitive pecuniary interests that conflict with our interests. We have not adopted a policy that expressly prohibits our directors, officers, security holders or affiliates from having a direct or indirect pecuniary or financial interest in any investment to be acquired or disposed of by us or in any transaction to which we are a party or have an interest. In fact, we may enter into a business combination with a target business that is affiliated with our sponsor, our directors or officers, although we do not intend to do so. Nor do we have a policy that expressly prohibits any such persons from engaging for their own account in business activities of the types conducted by us. Accordingly, such persons or entities may have a conflict between their interests and ours. 67 In particular, affiliates of our sponsor have invested in a diverse set of industries. As a result, there may be substantial overlap between companies that would be a suitable business combination for us and companies that would make an attractive target for such other affiliates. We may engage in a business combination with one or more target businesses that have relationships with entities that may be affiliated with our sponsor, directors or officers which may raise potential conflicts of interest. In light of the involvement of our sponsor, directors and officers with other entities, we may decide to acquire one or more businesses affiliated with our sponsor, directors and officers. Certain of our directors and officers also serve as officers and board members for other entities, including those described under "Management — Conflicts of Interest." Such entities may compete with us for business combination opportunities. Our sponsor, directors and officers are not currently aware of any specific opportunities for us to complete our initial business combination with any entities with which they are affiliated, and there have been no preliminary discussions concerning a business combination with any such entity or entities. Although we will not be specifically focusing on, or targeting, any transaction with any affiliated entities, we would pursue such a transaction if we determined that such affiliated entity met our criteria and guidelines for a business combination as set forth in "Proposed Business — Effecting Our Initial Business Combination — Selection of a target business and structuring of our initial business combination" and such transaction was approved by a majority of our independent and disinterested directors. Despite our agreement that we, or a committee of independent and disinterested directors, will obtain an opinion from an independent investment banking firm that is a member of the FINRA or from an independent accounting firm, regarding the fairness to our company from a financial point of view of a business combination with one or more domestic or international businesses affiliated with our sponsor, directors or officers, potential conflicts of interest still may exist and, as a result, the terms of the business combination may not be as advantageous to our public stockholders as they would be absent any conflicts of interest. Provisions in our amended and restated certificate of incorporation and Delaware law may have the effect of discouraging lawsuits against our directors and officers. Our amended and restated certificate of incorporation will require, unless we consent in writing to the selection of an alternative forum, that (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee to us or our stockholders, (iii) any action asserting a claim against us, our directors, officers or employees arising pursuant to any provision of the DGCL or our amended and restated certificate of incorporation or bylaws, or (iv) any action asserting a claim against us, our directors, officers or employees governed by the internal affairs doctrine may be brought only in the Court of Chancery in the State of Delaware, except any claim (A) as to which the Court of Chancery of the State of Delaware determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), (B) which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery, (C) for which the Court of Chancery does not have subject matter jurisdiction, or (D) any action arising under the Securities Act, as to which the Court of Chancery and the federal district court for the District of Delaware shall have concurrent jurisdiction. If an action is brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to service of process on such stockholder s counsel. Although we believe this provision benefits us by providing increased consistency in the application of Delaware law in the types of lawsuits to which it applies, a court may determine that this provision is unenforceable, and to the extent it is enforceable, the provision may have the effect of discouraging lawsuits against our directors and officers, although our stockholders will not be deemed to have waived our compliance with federal securities laws and the rules and regulations thereunder. Notwithstanding the foregoing, our amended and restated certificate of incorporation will provide that the exclusive forum provision will not apply to suits brought to enforce a duty or liability created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. 68 Additionally, unless we consent in writing to the selection of an alternative forum, the federal courts shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act against us or any of our directors, officers, other employees or agents. Section 22 of the Securities Act, however, created concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. Accordingly, there is uncertainty as to whether a court would enforce such provisions, and the enforceability of similar choice-of-forum provisions in other companies charter documents has been challenged in legal proceedings. While the Delaware courts have determined that such exclusive forum provisions are facially valid, a stockholder may nevertheless seek to bring a claim in a venue other than those designated in the exclusive forum provisions, and there can be no assurance that such provisions will be enforced by a court in those other jurisdictions. Any person or entity purchasing or otherwise acquiring any interest in our securities shall be deemed to have notice of and consented to these provisions; however, we note that investors cannot waive compliance with the federal securities laws and the rules and regulations thereunder. Although we believe this provision benefits us by providing increased consistency in the application of Delaware law in the types of lawsuits to which it applies, the provision may limit our stockholders ability to obtain a favorable judicial forum for disputes with us and may have the effect of discouraging lawsuits against our directors and officers. In addition, this provision may result in our stockholders incurring increased costs to bring a claim or action due to, but not limited to, the stockholder s physical location or knowledge of the applicable laws, when the federal district courts or the Court of Chancery of the State of Delaware, or an alternative forum, with our consent, is the sole and exclusive forum. 69 CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS Some statements contained in this prospectus are forward-looking in nature. Our forward-looking statements include, but are not limited to, statements regarding our or our management team s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intends," "may," "might," "plan," "possible," "potential," "predict," "project," "should," "would" and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this prospectus may include, for example, statements about: our ability to select an appropriate target business or businesses; our ability to complete our initial business combination; our expectations around the performance of a prospective target business or businesses; our expectations around the performance or projections of markets or industries; our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination; our directors and officers allocating their time to other businesses and potentially having conflicts of interest with or otherwise conflicting contractual obligations in connection with our business or in approving or consummating our initial business combination; our potential ability to obtain additional financing to complete our initial business combination; our pool of prospective target businesses and industries; the ability of our directors and officers to generate a number of potential business combination opportunities; our public securities potential liquidity and trading; the lack of a market for our securities; the use of proceeds not held in the trust account or available to us from interest income on the trust account balance; the trust account not being subject to claims of third parties; or our financial performance following this offering. The forward-looking statements contained in this prospectus are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described under the heading "Risk Factors." Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. 70 USE OF PROCEEDS We are offering 17,500,000 units at an offering price of $10.00 per unit. We estimate that the net proceeds of this offering, together with the funds we will receive from the sale of the private placement warrants, will be used as set forth in the following table. Without Over-Allotment Option Over-Allotment Option Exercised Gross proceeds Gross proceeds from units offered to public(1) $ 175,000,000 $ 201,250,000 Gross proceeds from private placement warrants offered in the private placement 9,700,000 10,750,000 Total gross proceeds $ 184,700,000 $ 212,000,000 Estimated offering expenses(2) Underwriting commissions (excluding deferred portion)(3) $ 3,500,000 $ 4,025,000 Legal fees and expenses 400,000 400,000 Accounting fees and expenses 120,000 120,000 Printing and engraving expenses 25,000 25,000 SEC expenses 18,656 18,656 FINRA expenses 35,000 35,000 NYSE listing fees 85,000 85,000 Miscellaneous expenses(5) 66,344 66,344 Total estimated offering expenses (other than underwriting commissions) $ 750,000 $ 750,000 Proceeds after estimated offering expenses $ 180,450,000 $ 207,225,000 Held in trust account(3) $ 178,500,000 $ 205,275,000 % of public offering size 102 % 102 % Not held in trust account(2)(3) $ 1,950,000 $ 1,950,000 The following table shows the use of the approximately $1,950,000 of net proceeds not held in the trust account(6). Amount % of Total Legal, accounting, due diligence, travel and other expenses in connection with any business combination(7) $ 380,000 20 % Legal and accounting fees related to regulatory reporting obligations 85,0004 4 % Reserve for liquidation expenses 100,000 5 % Directors and officers insurance premiums(4) 950,000 49 % NYSE continued listing fees 85,000 4 % Payment for office space, secretarial and administrative services 240,000 12 % Other miscellaneous expenses 110,000 6 % Total $ 1,950,000 100.00 % ____________ (1) Includes amounts payable to public stockholders who properly redeem their shares in connection with our successful completion of our initial business combination. (2) A portion of the offering expenses will be paid from the proceeds of a loan from our sponsor of up to $350,000 as described in this prospectus. This loan will be repaid upon completion of this offering out of the $750,000 of offering proceeds that has been allocated for the payment of offering expenses (other than underwriting commissions) not held in the trust account. As of September 30, 2021, $100,000 was outstanding under this loan. These expenses are estimates only. In the event that offering expenses are less than as set forth in this table, any such amounts will be used for post-closing working capital expenses. In the event that the offering expenses are more than as set forth in this table, we may fund such excess with funds not held in the trust account. (3) The underwriters have agreed to defer underwriting commissions equal to 3.5% of the gross proceeds of this offering. Upon completion of our initial business combination, $6,125,000, which constitutes the underwriters deferred commissions (or up to $7,043,750 if the underwriters over-allotment option is exercised in full) will be paid to the 71 underwriters from the funds held in the trust account, and the remaining funds, less amounts used to pay redeeming stockholders, will be released to us and can be used to pay all or a portion of the purchase price of the business or businesses with which our initial business combination occurs or for general corporate purposes, including payment of principal or interest on indebtedness incurred in connection with our initial business combination, to fund the purchases of other companies or for working capital. The underwriters will not be entitled to any interest accrued on the deferred underwriting discounts and commissions. No portion of this decreased amount would be held in the trust account and such amount would instead be available to pay offering expenses and/or for working capital. (4) This amount represents the approximate amount of annualized director and officer liability insurance premiums we anticipate paying following the completion of this offering and until we complete a business combination. (5) Includes organizational and administrative expenses and may include amounts related to above-listed expenses in the event actual amounts exceed estimates. (6) These expenses are estimates only. Our actual expenditures for some or all of these items may differ from the estimates set forth herein. For example, we may incur greater legal and accounting expenses than our current estimates in connection with negotiating and structuring a business combination based upon the level of complexity of such business combination. In the event we identify an acquisition target in a specific industry subject to specific regulations, we may incur additional expenses associated with legal due diligence and the engagement of special legal counsel. In addition, our staffing needs may vary and as a result, we may engage a number of consultants to assist with legal and financial due diligence. We do not anticipate any change in our intended use of proceeds, other than fluctuations among the current categories of allocated expenses, which fluctuations, to the extent they exceed current estimates for any specific category of expenses, would not be available for our expenses. The amount in the table above does not include interest available to us from the trust account. Based upon current interest rates, estimate that the interest earned on the trust account will be approximately $142,800 per year; however, we can provide no assurances regarding this amount. This estimate assumes an interest rate of 0.08% per annum based upon current yields of securities in which the trust account may be invested. In addition, in order to finance transaction costs in connection with an intended initial business combination, our sponsor or an affiliate of our sponsor or certain of our directors and officers may, but are not obligated to, loan us funds as may be required. If we complete our initial business combination, we may repay such loaned amounts out of the proceeds of the trust account released to us. Otherwise, such loans may be repaid only out of funds held outside the trust account. In the event that our initial business combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust account would be used to repay such loaned amounts. Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants issued to our sponsor. The terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. We do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our trust account. (7) Includes estimated amounts that may also be used in connection with our initial business combination to fund a "no shop" provision and commitment fees for financing. The rules of the NYSE provide that at least 90% of the gross proceeds from this offering and the sale of the private placement warrants be deposited in a trust account. Of the net proceeds of this offering and the sale of the private placement warrants, $178,500,000 (or $205,275,000 if the underwriters over-allotment option is exercised in full), including $6,125,000 (or up to $7,043,750 if the underwriters over-allotment option is exercised in full) of deferred underwriting commissions, will, upon the consummation of this offering, be placed in a U.S.-based trust account at J.P. Morgan Chase Bank, N.A. with Continental Stock Transfer & Trust Company acting as trustee. The funds in the trust account will be invested only in U.S. government treasury bills with a maturity of 185 days or less or in money market funds investing solely in U.S. Treasuries and meeting certain conditions under Rule 2a-7 under the Investment Company Act. Based on current interest rates, we estimate that the interest earned on the trust account will be approximately $142,800 per year, assuming an interest rate of 0.08% per year. We will not be permitted to withdraw any of the principal or interest held in the trust account except for the withdrawal of interest to pay taxes, if any. The funds held in the trust account will not otherwise be released from the trust account until the earliest of: (1) our completion of an initial business combination; (2) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering or (B) with respect to any other material provision relating to Class A common stockholders rights or pre-initial business combination activity; and (3) the redemption of our public shares if we have not completed an initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, subject to applicable law. Based on current interest rates, we expect that interest earned on the trust account will be sufficient to pay taxes. 72 The net proceeds held in the trust account may be used as consideration to pay the sellers of a target business with which we ultimately complete our initial business combination and to pay the deferred underwriting commissions. If our initial business combination is paid for using equity or debt, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or the redemption of our public shares, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of the post-transaction company, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. We believe that amounts not held in trust will be sufficient to pay the costs and expenses to which such proceeds are allocated. This belief is based on the fact that while we may begin preliminary due diligence of a target business in connection with an indication of interest, we intend to undertake in-depth due diligence, depending on the circumstances of the relevant prospective acquisition, only after we have negotiated and signed a letter of intent or other preliminary agreement that addresses the terms of a business combination. However, if our estimate of the costs of undertaking in-depth due diligence and negotiating a business combination is less than the actual amount necessary to do so, we may be required to raise additional capital, the amount, availability and cost of which is currently unascertainable. If we are required to seek additional capital, we could seek such additional capital through loans or additional investments from our sponsor, members of our management team or any of their affiliates, but such persons are not under any obligation to loan funds to, or otherwise invest in, us. Subsequent to the closing of this offering, we will pay affiliates of our sponsor $10,000 per month in aggregate for office space, secretarial and administrative services provided to members of our management team. Upon completion of our initial business combination or our liquidation, we will cease paying these monthly fees. Prior to the closing of this offering, our sponsor has agreed to loan us up to $350,000 under an unsecured promissory note to be used for a portion of the expenses of this offering. These loans are non-interest bearing, unsecured and are due at the earlier of March 31, 2022 and the closing of this offering. These loans will be repaid upon completion of this offering out of the $750,000 of offering proceeds that has been allocated for the payment of offering expenses (other than underwriting commissions) not held in the trust account. As of September 30, 2021, there was $100,000 outstanding under such promissory note. In addition, in order to finance transaction costs in connection with an intended initial business combination, our sponsor or an affiliate of our sponsor or certain of our directors and officers may, but are not obligated to, loan us funds as may be required. If we complete our initial business combination, we may repay such loaned amounts out of the proceeds of the trust account released to us. Otherwise, such loans may be repaid only out of funds held outside the trust account. In the event that our initial business combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust account would be used to repay such loaned amounts. Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants issued to our sponsor. The terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. We do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our trust account. If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, officers, advisors or any of their affiliates may also purchase shares in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Please see "Proposed Business — Permitted purchases and other transactions with respect to our securities" for a description of how such persons will determine from which stockholders to seek to acquire shares. The price per share paid in any such transaction may be different than the amount per share a public stockholder would receive if it elected to redeem its shares in connection with our initial business combination. However, such persons have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. If they engage in such transactions, they will be restricted from making any such purchases when they are in possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by 73 Regulation M under the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. We may not redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 following such redemptions and the agreement for our initial business combination may require as a closing condition that we have a minimum net worth or a certain amount of cash. If too many public stockholders exercise their redemption rights so that we cannot satisfy the net tangible asset requirement or any net worth or cash requirements, we would not proceed with such redemption and the related business combination, and may instead search for an alternate business combination. Our public stockholders will be entitled to receive funds from the trust account only upon the earliest to occur of: (1) our completion of an initial business combination, and then only in connection with those shares of Class A common stock that such stockholder properly elected to redeem, subject to the limitations described herein; (2) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering or (B) with respect to any other material provision relating to Class A common stockholders rights or pre-initial business combination activity; and (3) the redemption of our public shares if we have not completed an initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, subject to applicable law. In no other circumstances will a stockholder have any right or interest of any kind to or in the trust account. Holders of warrants will not have any right to the proceeds held in the trust account with respect to the warrants. Our initial stockholders, directors and officers have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and public shares held by them in connection with the completion of our initial business combination or certain amendments to our amended and restated certificate of incorporation as described elsewhere in this prospectus. In addition, our initial stockholders have agreed to waive their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within the prescribed time frame. However, if our initial stockholders acquire public shares, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the prescribed time frame. 74 DIVIDEND POLICY We have not paid any cash dividends on our common stock to date and do not intend to pay cash dividends prior to the completion of our initial business combination. The payment of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial condition subsequent to completion of our initial business combination. The payment of any cash dividends subsequent to our initial business combination will be within the discretion of our board of directors at such time. In addition, our board of directors is not currently contemplating and does not anticipate declaring any share dividends in the foreseeable future, except if we increase the size of this offering, in which case we will effect a capitalization or other appropriate mechanism immediately prior to the consummation of this offering in such amount as to maintain the number of founder shares at 20% of our issued and outstanding common stock upon the consummation of this offering. Further, if we incur any indebtedness, our ability to declare dividends may be limited by restrictive covenants we may agree to in connection therewith. 75 DILUTION The difference between the public offering price per share of Class A common stock, assuming no value is attributed to the warrants included in the units we are offering pursuant to this prospectus or the private placement warrants, and the pro forma net tangible book value per share after this offering constitutes the dilution to investors in this offering. Such calculation does not reflect any dilution associated with the sale and exercise of warrants, including the private placement warrants, which would cause the actual dilution to the public stockholders to be higher, particularly where a cashless exercise is utilized. Net tangible book value per share is determined by dividing our net tangible book value, which is our total tangible assets less total liabilities (including the value of the shares of Class A common stock which may be redeemed for cash), by the number of issued and outstanding common stock. At September 30, 2021, our net tangible book deficit was $(380,908), or approximately $ (0.08) per share of Class B common stock. After giving effect to the sale of 17,500,000 shares of Class A common stock included in the units we are offering by this prospectus, the sale of the private placement warrants and the deduction of underwriting commissions and estimated expenses of this offering, our pro forma net tangible book value at September 30, 2021 would have been $5,000,001 or $0.71 per share (or $5,000,001 or $0.62 per share if the underwriters over-allotment option is exercised in full), representing an immediate increase in net tangible book value (as decreased by the value of the 14,841,136 shares of Class A common stock that may be redeemed for cash, which is the maximum number of shares of Class A common stock that may be redeemed for cash to effect a business combination, and assuming no exercise of the underwriters over-allotment option) of $0.79 per share to our initial stockholders as of the date of this prospectus. The dilution to new investors from this offering will be $9.29 per share or $9.38 per share if the underwriters over-allotment option is exercised in full. In calculating the pro forma net tangible book value after this offering, we have given effect to the provision of our amended and restated memorandum and articles of association that will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001. Accordingly, we have calculated pro forma net tangible book value in the table below assuming that holders of approximately 84.8% of our public shares may redeem their shares for a pro rata share of the aggregate amount then on deposit in the trust account at a per share redemption price equal to the amount in the trust account. The following table illustrates the dilution to the public stockholders on a per-share basis, assuming no value is attributed to the warrants included in the units or the private placement warrants: No exercise of over-allotment option Exercise of over-allotment option in full Public offering price $ 10.00 $ 10.00 Net tangible book value before this offering (0.08 ) (0.08 ) Increase attributable to public stockholders 0.79 0.71 Pro forma net tangible book value after this offering and the sale of the private placement warrants 0.71 0.62 Dilution to public stockholders $ 9.29 $ 9.38 Percentage of dilution to new investors 92.9 % 93.8 % For purposes of presentation, we have reduced our pro forma net tangible book value after this offering (assuming no exercise of the underwriters over-allotment option) by $151,379,591 assuming holders of up to approximately 84.8% of our public shares may redeem their shares for a pro rata share of the aggregate amount then on deposit in the trust account at a per-share redemption price equal to the amount in the trust account calculated as of two business days prior to the consummation of the initial business combination, including interest (which interest shall be net of taxes payable), divided by the number of shares of Class A common stock sold in this offering. 76 The following table sets forth information with respect to our initial stockholders and the public stockholders: Shares Purchased Total Consideration Average Price Per Share Number Percentage Amount Percentage Initial Stockholders(1)(2) 4,375,000 20.0 % $ 25,000 0.01 % $ 0.006 Public Stockholders 17,500,000 80.0 % $ 175,000,000 99.99 % $ 10.00 21,875,000 100.00 % $ 175,025,000 100.000 % ____________ (1) Assumes the full forfeiture of 656,250 shares that are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. (2) Excludes 718,750 founder shares surrendered for no consideration by the sponsor on November 30, 2021. The pro forma net tangible book value per share after this offering, assuming no exercise of the underwriters over-allotment option, is calculated as follows, subject to the assumption described above: Without Over-allotment With Over-allotment Numerator: Net tangible book value before this offering $ (380,908 ) $ (380,908 ) Proceeds from this offering and sale of the private placement warrants, net of expenses (including non-deferred underwriting commissions)(1) 180,450,000 207,225,000 Offering costs accrued for and paid in advance, excluded from net tangible book value before this offering 60,000 60,000 Less: fair value of warrants from this offering and private placement (17,624,500 ) (19,879,375 ) Less: deferred underwriters commissions payable (6,125,000 ) (7,043,750 ) Less: proceeds held in trust subject to maximum redemptions to effect a business combination(2) (151,379,591 ) (174,980,966 ) $ 5,000,001 $ 5,000,001 Denominator: Shares of Class B common stock issued and outstanding prior to this offering(3) 5,031,250 5,031,250 Class B shares forfeited if over-allotment is not exercised (656,250 ) — Shares of Class A common stock included in the units offered 17,500,000 20,125,000 Less: maximum shares eligible to effect a business combination (14,841,136 ) (17,154,977 ) 7,033,864 8,001,253 ____________ (1) Expenses applied against gross proceeds include offering expenses of $750,000 and underwriting commissions of $3,500,000 (or $4,025,000 if the underwriters over-allotment option is exercised in full), excluding deferred underwriting fees. See "Use of Proceeds." (2) If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, executive officers, advisors or their affiliates may purchase shares or public warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. In the event of any such purchases of our shares prior to the completion of our initial business combination, the number of shares of Class A common stock subject to redemption will be reduced by the amount of any such purchases, increasing the pro forma net tangible book value per share. See "Proposed Business — Permitted purchases and other transactions with respect to our securities." (3) Excludes 718,750 founder shares surrendered by our sponsor for no consideration on November 30, 2021. 77 CAPITALIZATION The following table sets forth our capitalization at September 30, 2021, and as adjusted to give effect to the sale of our 17,500,000 units in this offering for $175,000,000 (or $10.00 per unit) and the sale of 9,700,000 private placement warrants for $9,700,000 (or $1.00 per warrant) and the application of the estimated net proceeds derived from the sale of such securities: September 30, 2021 Actual As Adjusted(2) Promissory note(1) $ 100,000 $ — Deferred underwriting commissions — 6,125,000 Warrant liabilities(3) — 17,624,500 Class A common stock, subject to possible redemption; $0.0001 par value, 280,000,000 shares authorized (actual and as adjusted); no shares issued and outstanding (actual); 17,500,000 shares issued and outstanding (as adjusted)(4) — 156,805,313 Stockholders equity: Preferred stock, $0.0001 par value, 1,000,000 shares authorized (actual and as adjusted); none issued or outstanding (actual and as adjusted) — — Class B common stock, $0.0001 par value, 20,000,000 shares authorized (actual and as adjusted); 5,031,250 issued and outstanding (actual) 4,375,000 issued and outstanding (as adjusted)(5) 503 437 Additional paid-in capital(6) 24,497 412,563 Accumulated deficit(7) (89,874 ) (582,687 ) Total stockholders equity (64,874 ) (169,687 ) Total capitalization $ 35,126 $ 180,385,126 ____________ (1) Our sponsor has agreed to loan us up to $350,000 under an unsecured promissory note to be used for a portion of the expenses of this offering. As of September 30, 2021, there was $100,000 outstanding under such promissory note. (2) Assumes the full forfeiture of 656,250 shares that are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. The proceeds of the sale of such shares will not be deposited into the trust account, the shares will not be eligible for redemption from the trust account nor will they be eligible to vote upon the initial business combination. (3) We will account for the 18,450,000 warrants to be issued in connection with this offering (the 8,750,000 warrants included in the units and the 9,700,000 private placement warrants, assuming the underwriters over-allotment option is not exercised) in accordance with the guidance contained in ASC 815-40. Such guidance provides that because the warrants do not meet the criteria for equity treatment thereunder, each warrant must be recorded as a liability. Accordingly, we will classify each warrant as a liability at its fair value. This liability is subject to re-measurement at each balance sheet date. With each such re-measurement, the warrant liability will be adjusted to fair value, with the change in fair value recognized in our statement of operations. The warrants are also subject to re-evaluation of the proper classification and accounting treatment at each reporting period. (4) Upon the completion of our initial business combination, we will provide our public stockholders with the opportunity to redeem their public shares for cash equal to their pro rata share of the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of the initial business combination, including interest (which interest shall be net of taxes payable), subject to the limitations described herein whereby our net tangible assets will be maintained at a minimum of $5,000,001 following such redemptions, and any limitations (including, but not limited to, cash requirements) created by the terms of the proposed business combination. The "as adjusted" amount is presented net of proceeds allocated to the public warrants and net of allocated transaction costs related to this offering. The Class A common stock contain redemption rights that make them redeemable by our public stockholders. Accordingly, they are classified within temporary equity in accordance with the guidance provided in ASC 480-10-S99-3A, and will be subsequently accreted to redemption value. (5) Actual share amount is after surrender of 718,750 shares by the sponsor on November 30, 2021 and prior to any forfeiture of founder shares by our sponsor. As adjusted share amount assumes no exercise of the underwriters over-allotment option. (6) As adjusted additional paid in capital includes the excess of the proceeds from the sale of the private placement warrants over their estimated fair value at issuance as a deemed capital contribution from our sponsor. (7) As adjusted accumulated deficit includes transaction costs allocated to warrant liability. Such costs will be immediately expensed. 78 MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Overview We are a newly organized blank check company incorporated on March 24, 2021 as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. We have not selected any business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. We intend to effectuate our initial business combination using cash from the proceeds of this offering and the sale of the private placement warrants, our shares (including to the target or pursuant to forward purchase agreements or backstop agreements we may enter into following the consummation of this offering or otherwise), debt or a combination of cash, shares and debt. The issuance of additional common stock or preferred shares in a business combination: may significantly dilute the equity interest of investors in this offering, which dilution would increase if the anti-dilution provisions in the Class B common stock resulted in the issuance of shares of Class A common stock on a greater than one-to-one basis upon conversion of the Class B common stock; may subordinate the rights of holders of common stock if preferred shares are issued with rights senior to those afforded our common stock; could cause a change of control if a substantial number of our common stock are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present directors and officers; may have the effect of delaying or preventing a change of control of us by diluting the share ownership or voting rights of a person seeking to obtain control of us; may adversely affect prevailing market prices for our units, common stock and/or warrants; and may not result in adjustment to the exercise price of our warrants. Similarly, if we issue debt or otherwise incur significant indebtedness, it could result in: default and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt obligations; acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant; our immediate payment of all principal and accrued interest, if any, if the debt is payable on demand; our inability to obtain necessary additional financing if the debt contains covenants restricting our ability to obtain such financing while the debt is outstanding; our inability to pay dividends on our common stock; using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends on our common stock if declared, expenses, capital expenditures, acquisitions and other general corporate purposes; limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate; 79 increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation; and limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, execution of our strategy and other purposes and other disadvantages compared to our competitors who have less debt. As indicated in the accompanying financial statements, at September 30, 2021 we had $12,500 in cash, negative working capital of $380,908 and deferred offering costs of approximately $316,034. Further, we expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to raise capital or to complete our initial business combination will be successful. These factors, among others, raise substantial doubt about our ability to continue as a going concern. Results of Operations and Known Trends or Future Events We have neither engaged in any operations nor generated any revenues to date. Our only activities since inception have been organizational activities and those necessary to prepare for this offering. Following this offering, we will not generate any operating revenues until after completion of our initial business combination. We will generate non-operating income in the form of interest income on cash and cash equivalents after this offering. There has been no significant change in our financial or trading position and no material adverse change has occurred since the date of our audited financial statements. After this offering, we expect to incur increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses. We expect our expenses to increase substantially after the closing of this offering. Liquidity and Capital Resources Our liquidity needs have been satisfied prior to the completion of this offering through $25,000 paid by the sponsor to cover certain of our offering and formation costs in exchange for the issuance of the founder shares to our sponsor and up to $350,000 in loans from our sponsor under an unsecured promissory note. As of September 30, 2021, there was $100,000 outstanding under such promissory note. We estimate that the net proceeds from (1) the sale of the units in this offering, after deducting offering expenses of approximately $750,000 and underwriting commissions of $3,500,000 (or up to $4,025,000 if the underwriters over-allotment option is exercised in full), excluding deferred underwriting commissions of $6,125,000 (or up to $7,043,750 if the underwriters over-allotment option is exercised in full), and (2) the sale of the private placement warrants for a purchase price of $9,700,000 (or $10,750,000 in the aggregate if the underwriters over-allotment option is exercised in full) will be $180,450,000 (or $207,225,000 if the underwriters over-allotment option is exercised in full). Of this amount, $178,500,000 or $205,275,000 if the underwriters over-allotment option is exercised in full, including $6,125,000 (or up to $7,043,750 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions will be deposited into the trust account. The funds in the trust account will be invested only in U.S. government treasury bills with a maturity of 185 days or less or in money market funds investing solely in U.S. Treasuries. The remaining $1,950,000 will not be held in the trust account. In the event that our offering expenses exceed our estimate of $750,000 we may fund such excess with funds not to be held in the trust account. In such case, the amount of funds we intend to be held outside the trust account would decrease by a corresponding amount. Conversely, in the event that the offering expenses are less than our estimate of $750,000, the amount of funds we intend to be held outside the trust account would increase by a corresponding amount. We intend to use substantially all of the funds held in the trust account, including any amounts representing interest earned on the trust account (which interest shall be net of taxes payable and excluding deferred underwriting commissions) to complete our initial business combination. We may withdraw interest to pay taxes, if any. Our annual income tax obligations will depend on the amount of interest and other income earned on the amounts held in the trust account. We expect the interest earned on the amount in the trust account will be sufficient to pay our taxes. We expect the only taxes payable by us out of the funds in the trust account will be income and franchise taxes, if any. To the extent that our common stock or debt is used, in whole or in part, as consideration to complete our initial business combination, the remaining proceeds held in the trust account will be used as working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies. 80 Prior to the completion of our initial business combination, we will have available to us $1,950,000 of proceeds held outside the trust account. We will use these funds primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses, travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review corporate documents and material agreements of prospective target businesses, structure, negotiate and complete a business combination, and to pay taxes to the extent the interest earned on the trust account is not sufficient to pay our taxes. In order to fund working capital deficiencies or finance transaction costs in connection with an intended initial business combination, our sponsor or an affiliate of our sponsor or certain of our directors and officers may, but are not obligated to, loan us funds as may be required. If we complete our initial business combination, we may repay such loaned amounts out of the proceeds of the trust account released to us. Otherwise, such loans may be repaid only out of funds held outside the trust account. In the event that our initial business combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust account would be used to repay such loaned amounts. Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants issued to our sponsor. The terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. We do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our trust account. We expect our primary liquidity requirements during that period to include approximately $380,000 for legal, accounting, due diligence, travel and other expenses in connection with any business combinations; $85,000 for legal and accounting fees related to regulatory reporting requirements; $ 950,000 for directors and officers insurance premiums; $85,000 for continued exchange listing fees; $100,000 as a reserve for liquidation expenses; and $110,000 for other miscellaneous expenses. We will also pay affiliates of our sponsor $10,000 per month in aggregate for office space, secretarial and administrative services provided to members of our management team subsequent to the closing of this offering. These amounts are estimates and may differ materially from our actual expenses. In addition, we could use a portion of the funds not being placed in trust to pay commitment fees for financing, fees to consultants to assist us with our search for a target business or as a down payment or to fund a "no-shop" provision (a provision designed to keep target businesses from "shopping" around for transactions with other companies or investors on terms more favorable to such target businesses) with respect to a particular proposed business combination, although we do not have any current intention to do so. If we entered into an agreement where we paid for the right to receive exclusivity from a target business, the amount that would be used as a down payment or to fund a "no-shop" provision would be determined based on the terms of the specific business combination and the amount of our available funds at the time. Our forfeiture of such funds (whether as a result of our breach or otherwise) could result in our not having sufficient funds to continue searching for, or conducting due diligence with respect to, prospective target businesses. We do not believe we will need to raise additional funds following this offering in order to meet the expenditures required for operating our business. However, if our estimates of the costs of identifying a target business, undertaking in-depth due diligence and negotiating an initial business combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our initial business combination. Moreover, we may need to obtain additional financing to complete our initial business combination, either because the transaction requires more cash than is available from the proceeds held in our trust account, or because we become obligated to redeem a significant number of our public shares upon completion of the business combination, in which case we may issue additional securities or incur debt in connection with such business combination. If we have not consummated our initial business combination within the required time period because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the trust account. Controls and Procedures We are not currently required to maintain an effective system of internal controls as defined by Section 404 of the Sarbanes-Oxley Act. We will be required to comply with the internal control reporting requirements of the Sarbanes-Oxley Act for the fiscal year ending December 31, 2023. Only in the event that we are deemed to be a large accelerated filer or an accelerated filer, and no longer qualify as an emerging growth company, will we be required to comply with the independent registered public accounting firm attestation requirement on our internal 81 control over financial reporting. Further, for as long as we remain an emerging growth company, we intend to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the independent registered public accounting firm attestation requirement. Prior to the closing of this offering, we have not completed an assessment, nor has our independent registered public accounting firm tested our systems, of internal controls. We expect to assess the internal controls of our target business or businesses prior to the completion of our initial business combination and, if necessary, to implement and test additional controls as we may determine are necessary in order to state that we maintain an effective system of internal controls. A target business may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding the adequacy of internal controls. Many small and mid-sized target businesses we may consider for our initial business combination may have internal controls that need improvement in areas such as: staffing for financial, accounting and external reporting areas, including segregation of duties; reconciliation of accounts; proper recording of expenses and liabilities in the period to which they relate; evidence of internal review and approval of accounting transactions; documentation of processes, assumptions and conclusions underlying significant estimates; and documentation of accounting policies and procedures. Because it will take time, management involvement and perhaps outside resources to determine what internal control improvements are necessary for us to meet regulatory requirements and market expectations for our operation of a target business, we may incur significant expenses in meeting our public reporting responsibilities, particularly in the areas of designing, enhancing, or remediating internal and disclosure controls. Doing so effectively may also take longer than we expect, thus increasing our exposure to financial fraud or erroneous financing reporting. Once our management s report on internal controls is complete, we will retain our independent registered public accounting firm to audit and render an opinion on such report when required by Section 404 of the Sarbanes-Oxley Act. The independent registered public accounting firm may identify additional issues concerning a target business s internal controls while performing their audit of internal control over financial reporting. Quantitative and Qualitative Disclosures about Market Risk The net proceeds of this offering and the sale of the private placement warrants held in the trust account will be invested in U.S. government treasury bills with a maturity of 185 days or less or in money market funds investing solely in U.S. Treasuries and meeting certain conditions under Rule 2a-7 under the Investment Company Act. Due to the short-term nature of these investments, we believe there will be no associated material exposure to interest rate risk. We will account for the 18,450,000 warrants to be issued in connection with this offering (the 8,750,000 warrants included in the units and the 9,700,000 private placement warrants, assuming the underwriters over-allotment option is not exercised) in accordance with the guidance contained in ASC 815-40. Such guidance provides that because the warrants do not meet the criteria for equity treatment thereunder, each warrant must be recorded as a liability. Related Party Transactions On May 12, 2021, our sponsor paid $25,000 to cover certain of our offering and formation costs in exchange for an aggregate of 5,750,000 shares of Class B common stock, par value $0.0001 per share. On November 30, 2021, our sponsor surrendered 718,750 founder shares for no consideration, resulting in our sponsor holding 5,031,250 shares of Class B common stock, representing an effective purchase price of approximately $0.005 per share. Our sponsor also transferred an aggregate of 200,000 founder shares to our outside directors, resulting in our sponsor holding 4,831,250 founder shares. Our initial stockholders will collectively own 20% of our issued and outstanding shares after this offering (assuming they do not purchase any units in this offering). If we increase or decrease the size of this offering, we will effect a capitalization or share repurchase or redemption or other appropriate mechanism, as 82 applicable, with respect to our Class B common stock immediately prior to the consummation of this offering in such amount as to maintain the number of founder shares at 20% of our issued and outstanding common stock upon the consummation of this offering. Our sponsor, directors and officers, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business combinations. Our audit committee will review on a quarterly basis all payments that were made by us to our sponsor, directors, officers or our or any of their affiliates and will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling on the reimbursement of out-of-pocket expenses incurred by such persons in connection with activities on our behalf. Our sponsor has agreed to loan us up to $350,000 under an unsecured promissory note to be used for a portion of the expenses of this offering. These loans are non-interest bearing, unsecured and are due at the earlier of March 31, 2022 and the closing of this offering. These loans will be repaid upon completion of this offering out of the $750,000 of offering proceeds that has been allocated for the payment of offering expenses (other than underwriting commissions) not held in the trust account. As of September 30, 2021, there was $100,000 outstanding under such promissory note. In addition, in order to finance transaction costs in connection with an intended initial business combination, our sponsor or an affiliate of our sponsor or certain of our directors and officers may, but are not obligated to, loan us funds as may be required. If we complete our initial business combination, we may repay such loaned amounts out of the proceeds of the trust account released to us. Otherwise, such loans may be repaid only out of funds held outside the trust account. In the event that our initial business combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust account would be used to repay such loaned amounts. Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants issued to our sponsor. The terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. We do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our trust account. Our sponsor has committed to purchase an aggregate of 9,700,000 (or 10,750,000 if the underwriters over-allotment option is exercised in full) private placement warrants at a price of $1.00 per warrant ($9,700,000 in the aggregate or $10,750,000 in the aggregate if the underwriters over-allotment option is exercised in full) in a private placement that will occur simultaneously with the closing of this offering. Each private placement warrant entitles the holder to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment as provided herein. The private placement warrants are identical to the warrants sold as part of the units in this offering except that, so long as they are held by our sponsor or its permitted transferees: (1) they will not be redeemable by us (except as described below under "Description of Securities — Redeemable Warrants — Public Redeemable Warrants — Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00"); (2) they (including the shares of Class A common stock issuable upon exercise of these warrants) may not, subject to certain limited exceptions, be transferred, assigned or sold by our sponsor until 30 days after the completion of our initial business combination; (3) they may be exercised by the holders on a cashless basis; and (4) they (including the common stock issuable upon exercise of these warrants) are entitled to registration rights. Pursuant to a registration rights agreement that we will enter into with our initial stockholders, officers and directors on or prior to the closing of this offering, we may be required to register certain securities for sale under the Securities Act. To the extent such parties hold any of our securities, they and holders of warrants issued upon conversion of working capital loans or extension loans, if any, are entitled under the registration rights agreement to make up to three demands that we register certain of our securities held by them for sale under the Securities Act and to have the securities covered thereby registered for resale pursuant to Rule 415 under the Securities Act. In addition, these holders have the right to include their securities in other registration statements filed by us. However, the registration rights agreement provides that we will not be required to effect or permit any registration or cause any registration statement to become effective until the securities covered thereby are released from their lock-up restrictions, as described herein. We will bear the costs and expenses of filing any such registration statements. See "Principal Stockholders — Registration Rights." 83 Off-Balance Sheet Arrangements; Commitments and Contractual Obligations; Quarterly Results As of September 30, 2021, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K and did not have any commitments or contractual obligations. No unaudited quarterly operating data is included in this prospectus as we have conducted no operations to date. JOBS Act The JOBS Act contains provisions that, among other things, relax certain reporting requirements for qualifying public companies. We will qualify as an "emerging growth company" and under the JOBS Act will be allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies. We are electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates. Additionally, we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an "emerging growth company," we choose to rely on such exemptions we may not be required to, among other things: (1) provide an auditor s attestation report on our system of internal controls over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act; (2) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act; (3) comply with any requirement that may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements (auditor discussion and analysis); and (4) disclose certain executive compensation-related items such as the correlation between executive compensation and performance and comparisons of the CEO s compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of this offering or until we are no longer an "emerging growth company," whichever is earlier. 84 PROPOSED BUSINESS Our Company We are a newly organized, blank check company incorporated on March 24, 2021 as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any specific business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. While we may pursue an acquisition opportunity in any business industry or sector, we intend to capitalize on our management team s differentiated ability to source, acquire, and manage a business in the healthcare industry, specifically in the healthcare technology, healthcare technology-enabled services, or digital health subsectors. We believe these subsectors present significant opportunities tied to emerging themes including value-based care, population health, social determinants of health, consumer engagement and empowerment, care coordination, access enhancement and real-world evidence utilization in life sciences. Our management team and advisors have extensive track records of creating value for stockholders by identifying, investing into and acquiring businesses in these sectors and subsectors tied to many of these themes. Our management team and advisors have demonstrated expertise in growth investing while driving operational excellence and financial discipline to create sustained and growing stockholder value. We are also supported by our sponsor. Members of our sponsor include FTCP and Martin Ventures. FTCP is a private investment firm focused primarily on healthcare and financial services investments. FTCP has made over 60 private market investments in multiple sectors with a substantial focus on investing in and supporting healthcare information technology, healthcare technology-enabled services and healthcare technology, healthcare services and healthcare businesses that are influencing and capitalizing on emerging trends in the healthcare field. FTCP and its affiliates have made 38 investments in healthcare technology and services companies and have fully exited nine of those investments. Martin Ventures is a Nashville-based investment firm focused on building and investing in healthcare companies, particularly in healthcare information technology and healthcare technology enabled services. Martin Ventures currently has a portfolio of 20 private healthcare investments. FTCP and Martin Ventures, along with our management team and our advisors, provide significant domain knowledge and expertise, and we believe they will deliver insightful strategic perspectives, extensive access to acquisition targets and resources to aid in the identification, diligence, and negotiations associated with our initial business combination. In addition, we anticipate that our sponsor will provide meaningful incremental financial discipline, operational support, and governance after our initial business combination. Healthcare Industry Attractiveness The healthcare sector is large and rapidly growing, and our management team will use its deep knowledge of the sector and market participants to efficiently pursue attractive acquisition opportunities that utilize technology to address long-term, structural challenges in the industry. In 2018, U.S. healthcare expenditures amounted to $3.6 trillion, or 17.7% of total GDP, according to the Centers for Medicare & Medicaid Services ("CMS"). CMS projects U.S. healthcare expenditures will rise to $6.2 trillion through 2028, or 19.7% of GDP, representing a 5.4% compound annual growth rate, meaningfully outpacing projected U.S. GDP growth over the projection period. Absent innovation, the current trajectory of rising healthcare costs will likely result in reduced competitiveness for the broader U.S. economy over time as the healthcare delivery and payment ecosystem consumes ever increasing resources. We believe the healthcare industry needs to continue to pursue initiatives to generate meaningful productivity improvements aiming to reduce cost and improve care outcomes while also increasing consumer access and improving the consumer experience. We believe information technology and technology-enabled services companies will be critical components of any fundamental changes to healthcare delivery and payment. The ongoing growth of healthcare spending has significantly pressured all industry participants (including consumers, employers, insurers, providers, life sciences companies, and government agencies) to manage costs while simultaneously maintaining or increasing access and improving health outcomes. Many constituents in the healthcare system are pursuing new and innovative technologies and business models aimed at improving the quality of outcomes for individuals, reducing friction in the consumer health journey, and delivering enhanced care at a lower cost. 85 We intend to focus our acquisition efforts across certain emerging themes in the healthcare market. We believe there is a large and attractive addressable market of potential business combination targets addressing these themes and intend to concentrate on target companies with developed strategies, established customer bases, differentiated solutions and attractive growth prospects with enterprise values of up to $1.5 billion. The breadth of the thematic opportunities and diversity of the target universe across multiple compelling subsectors maximize the likelihood that our management team will be able to identify and execute an attractive transaction with the aim to generate substantial stockholder value over time. Our belief that a large addressable market of potential acquisition targets exists is based on our knowledge of the healthcare information technology and technology-enabled healthcare services markets, and, in part, due to the scale of the industry as well as the innovation and technology-enablement currently underway. Many potential targets are held by private equity or venture capital investors with finite investment horizons who will eventually seek to exit their positions. Recent private funding by venture capital and private equity firms has been significant; according to Pitchbook, there was approximately $117 billion of funding into U.S. healthcare companies in 2020, up from approximately $58 billion in 2016. Recently, public market interest has been strong for healthcare technology and tech-enabled healthcare services assets, representing approximately 25% of capital raised in healthcare IPOs since 2018 with higher growth in number of IPOs relative to other healthcare subsectors over the same time period, according to Dealogic. In light of the recent, robust public and private healthcare market activity, we believe that there are still a large number of potential business combination targets with financial and operating characteristics that will be attractive to public equity investors. Based on our current knowledge and data from Pitchbook, we believe that there are more than 2,000 healthcare information technology or technology-enabled healthcare services companies in the United States, and of such companies, we believe there are more than 500 of appropriate size and scale to be ready for public markets either on their own or combined with another company or companies Our Management Team Our management team is led by Charles N. Martin, our Chairman, Justin Dearborn, our Co-Chief Executive Officer, and Jonathan Phillips, our Co-Chief Executive Officer. Charles N. Martin, Chairman Charles Martin, our Chairman, is the founder and Chairman of Martin Ventures, a Nashville-based investment firm he founded in 2009. Mr. Martin has more than 50 years of experience operating large, complex healthcare systems. At Martin Ventures, he leads an investment firm dedicated to building and investing in healthcare technology, healthcare services and healthcare technology-enabled services companies that optimize existing healthcare provider businesses, develop new and innovative models of care, and empower the healthcare consumer. Martin Ventures has a current portfolio of 20 healthcare companies and has successfully exited an additional 13 healthcare investments. Prior to launching Martin Ventures, Mr. Martin founded Vanguard Health Systems and served as Vanguard s Founder, Chairman, and Chief Executive Officer for 16 years. Vanguard went public in 2011, and in 2013 was acquired by Tenet Healthcare for $4.3 billion. Before launching Vanguard, Mr. Martin, in conjunction with private equity partners, acquired the hospital chain Republic Health, ultimately founding a new healthcare system called OrNda Healthcare Corp. OrNda became the nation s third-largest investor-owned hospital chain with 53 hospitals before being sold to Tenet Healthcare Corp. in 1997 for $1.8 billion. Earlier in Mr. Martin s career, he served in numerous executive roles with Hospital Corporation of America, Inc., General Care Corp. and HealthTrust Inc. Mr. Martin has also served on numerous boards of directors, including the University of Pennsylvania Law School and RAND Health, an independent health research group. Mr. Martin received his B.A. from Southern Adventist University. Justin Dearborn, Co-Chief Executive Officer and Director Justin Dearborn, our Co-Chief Executive Officer and a director, has over 25 years of experience leading healthcare, technology and publishing businesses, and is currently serving as the Chief Executive Officer of PatientBond, Inc., a digital patient engagement company powered by healthcare consumer psychographics. Before his role as Chief 86 Executive Officer of PatientBond, Mr. Dearborn served as Chief Executive Officer of Tribune Publishing Company (Nasdaq: TPCO), a media company, from 2016 to 2019 and as Chief Executive Officer and Chairman from 2018 to 2019. Mr. Dearborn was chief executive officer of eMed, an at-home diagnostic testing company, in 2020. Mr. Dearborn was Chief Operating Officer for ICM Partners, a leading talent agency, in 2019. Prior to Tribune, he served as Chief Executive Officer and a director of Merge Healthcare Incorporated (Nasdaq: MRGE), a clinical software solution provider from 2008 until 2016. During his tenure, Mr. Dearborn led the company through a period of transformation and sustainable growth. While serving as Chief Executive Officer of Merge, he executed a multi-faceted growth strategy comprised of significant investments in sales and marketing capabilities across Merge s core solution offerings while pursuing acquisitions to broaden market reach into adjacent sectors and to increase capabilities and share of current solution offerings. Mr. Dearborn joined Merge as Chief Executive Officer when Merge s enterprise value was approximately $10 million. Merge was acquired by IBM for $1 billion in 2015 and was integrated into IBM s Watson Health division to deliver intuitive, cognitive computing solutions to healthcare providers. Over his career, Mr. Dearborn has led the acquisition of numerous companies, including the sales of Merge and the LA Times. Before joining Merge, Mr. Dearborn served as managing director at Merrick Ventures, LLC, a private investment firm. In addition to serving on the board of directors of PatientBond, Mr. Dearborn is serving out his final term as a director and Chairman of the Audit Committee, of Next Level Health, an Illinois based Medicaid insurance provider that was acquired by Centene Corporation in 2020. Mr. Dearborn received his B.S. in Accounting from Illinois State University and his J.D. from Depaul College of Law. Jonathan R. Phillips, Co-Chief Executive Officer and Director Jonathan Phillips, our Co-Chief Executive Officer and a director, has over 25 years of experience in healthcare information technology, healthcare services, investment banking and private investing. Mr. Phillips has served as Managing Director and Head of Private Equity for FTCP, headquartered in Wheaton, Illinois, since November 2016. Mr. Phillips is also the founder and Managing Partner of First Health Capital Partners, LLC, a healthcare technology and services investment firm founded in January 2016. Mr. Phillips has led investments in a broad range of healthcare technology and services companies, including Vivify Health (acquired by United Health Group in 2019), Lightbeam Health, AVIA, RxAnte, and Wellvana Health. Before his role at First Trust Capital Partners, in 2005, Mr. Phillips founded Healthcare Growth Partners, LLC, a provider of strategic and financial advisory services to healthcare technology companies, and he served as its Managing Director until November 2016. Prior to founding Healthcare Growth Partners, Mr. Phillips was a member of the Healthcare Investment Banking Group at William Blair, an investment banking firm. Prior to William Blair, he served in various roles in the healthcare practice of Deloitte Consulting. Mr. Phillips currently serves as a director and as the Audit Committee chair for Streamline Health (Nasdaq: STRM), a publicly traded healthcare information technology company. In addition, Mr. Phillips serves on the boards of a number of private companies including AVIA, Conversio Health, Cordata Healthcare Innovations, Lightbeam Health, PatientBond, RxAnte, Wellbox and Wellvana. Mr. Phillips has completed over 115 transactions involving healthcare companies and has completed over 40 strategic advisory engagements for healthcare technology and services companies. Mr. Phillips earned his MBA in Finance, Marketing and Health Services Management from the J. L. Kellogg School of Management, Northwestern University, and his BA in Economics and Management from DePauw University. Our Non-Executive Director Nominees Matthew Etheridge, Director Nominee Matthew Etheridge is a private investor with over 20 years of investment management experience, with a primary focus on healthcare services and information technology. He has invested in and served on the board of directors of several public and private companies in these areas, including NaviHealth (acquired by Cardinal Health in 2018) Universal American Corp. (NYSE: UAM; acquired by Wellcare in 2017), Lightbeam Health Solutions, Healthmine and Conversio Health. Previously, Mr. Etheridge was a Managing Partner of Perry Capital LLC, a private investment management firm, where he was Co-Portfolio Manager of the firm s healthcare group, which managed public and private investments in healthcare and other industries. Prior to joining Perry Capital in 2001, Mr. Etheridge was an investment analyst for Stanford Management Company, the investment manager of Stanford University s endowment. Prior to joining Stanford Management in 1997, Mr. Etheridge was a consultant with McKinsey & Company. Mr. Etheridge received his J.D. from Stanford Law School and his A.B. in Economics from Stanford University. 87 Jeremy Friese, M.D., Director Nominee Jeremy Friese, M.D., is a physician executive with a demonstrated passion for improving healthcare, first as an academic physician leader at Mayo Clinic then as an entrepreneur with various healthcare companies. Dr. Friese currently serves as President, Payer Market at Olive, a developer of process automation software designed to build meaningful artificial intelligence for healthcare payers and providers. Prior to Olive, Dr. Friese ran Invenshure, a healthcare venture incubator, and co-founded and led Verata Health, a venture-backed AI technology company that pioneered Frictionless Prior Authorization for payers and providers, and which was acquired by Olive in 2020. Prior to his transition to entrepreneurship, Dr. Friese was a physician and executive at the Mayo Clinic College of Medicine and Science and his MBA at Harvard Business School. During his Mayo career, he held executive leadership positions for the imaging service line, the Mayo Clinic Strategic Investment Fund, and Global Business Development. Additionally, Dr. Friese served on several boards of directors, including the International Monetary Fund and the American Cancer Society. Dr. Friese earned his MD at Mayo Clinic and his MBA at Harvard Business School. Kelly Richmond Pope, Ph.D., Director Nominee Kelly Richmond Pope, Ph.D., is a professor in the School of Accountancy and Management Information Systems at DePaul University. Prior to joining DePaul, she worked in the forensic accounting practice at KPMG, LLP on anti-money laundering engagements, insurance fraud investigations and fraud risk management projects. She was named as one of the 25 most powerful women in accounting by the AICPA and CPA Practice Advisor. She currently serves as director and chair of the Audit Committee for the Greater Chicago Food Depository. She is former director and finance chair for Mercy Hospital & Medical Center, former director of the Illinois CPA Society and former member of the governing council for the AICPA. She received her doctorate in accounting from Virginia Tech and she is a licensed certified public accountant. John Glaser Ph.D., Director Nominee John Glaser, Ph.D., is a former senior vice president of Population Health at Cerner Corporation from 2015 to 2019. Prior to such time, he was Chief Executive Officer of Siemens Heath Services from 2010 to 2015. Prior to Siemens, Dr. Glaser was Chief Information Officer at Partners HealthCare. He was the founding chair of CHIME and the past-president of the Healthcare Information and Management Systems Society. He is the former Chair of the Global Agenda Council on Digital Health, World Economic Forum. He is former Senior Advisor to the Office of the National Coordinator for Health Information Technology. Dr. Glaser serves on the boards of directors of the Scottsdale Institute, Intouch Health, PatientPing, National Committee for Quality Assurance, the American Telemedicine Association, Wellsheet and Relatient. Dr. Glaser has received numerous industry awards, including the John P. Glaser Innovation Award (established by the School of Biomedical Informatics, UTHealth), William B. Stead Thought Leadership Award (American Medical Informatics Association) and the Lifetime Achievement Award (CHIME). He has authored many articles and books on the strategic application of IT in health care. He is on the faculty of the Wharton School at the University of Pennsylvania, the UTHealth School of Biomedical Informatics and the Harvard School of Public Health. Anthony Sanzo, Director Nominee Anthony Sanzo has been a healthcare and healthcare information technology executive for over 20 years and brings a deep understanding of the operational challenges faced by healthcare providers and the ways that technology solutions can be deployed to address them. Mr. Sanzo currently serves as Chairman of the Board of Net Health Systems, a specialized electronic health record software and services vendor providing technology solutions that address the continuum of care from hospital to home. Prior to his role as Chairman, Mr. Sanzo was Chief Executive Officer of Net Health from 2012 until 2019. Over the course of his tenure, Net Health grew from a single product startup to a multi-product, multimarket, healthcare information technology company. Prior to joining Net Health, Mr. Sanzo served as the Chief Executive Officer for TeleTracking Technologies, a company he joined in late 2001. During his tenure, the company evolved from a workflow automation startup focusing on hospital support services to the world market and innovation leader in patient flow automation, capacity management and related operations improvements. With more than 800 clients in three countries, TeleTracking grew to become the largest vendor in its market. Prior to TeleTracking, Mr. Sanzo held executive positions for two major academic medical centers and 88 served as the Chief Executive Officer for Allegheny General Hospital for nearly a decade. Mr. Sanzo has been a board member of multiple companies and is a graduate of Allegheny College and Duke University s Fuqua School of Business. Advisory Board Michael Connolly Mike Connolly has over 30 years of experience enabling significant performance improvements and driving large scale transformations in healthcare and consulting businesses. Mr. Connolly currently leads PwC s Transformation Consulting business line. He has P&L responsibility for a business that provides advisory services in areas including strategy, customer success, operations, mergers and acquisitions, finance, workforce management and clinical consulting across various sectors, including healthcare. Prior to his current role, Mr. Connolly served as the leader of PwC s Health Advisory businesses. Before re-joining PwC in 2019, Mr. Connolly was president of Ciox Health where he was responsible for developing its clinical data exchange and the related AI driven technology platform from 2017 to 2019. He also created a transformation program to integrate multiple acquisitions and improve operating and financial performance. Prior to joining Ciox, Mr. Connolly was a senior partner at PwC, driving PwC s Platform businesses where he focused on standing up large transformation businesses across PwC. Before joining PwC, Mr. Connolly worked at Booz & Co. as Global Managing Director of Platforms and Functional Practices, Leader of the Global Technology Practice and served as a member of the board of directors and Executive Committee. Prior to joining Booz & Co., Mr. Connolly served as the Chief Technology Officer of Aetna from 2004 to 2006 and the President of Diamond Technology Partners from 1995 to 2005. Mr. Connolly served on the board of directors of Signify Health from 2018 to 2019. Mr. Connolly holds an M.B.A. in management information systems from Northern Illinois University. Mr. Connolly also attended Indiana University, where he received a B.S. degree in Finance with High Distinction and was admitted to the Beta Gamma Sigma Honor Society. Steven Tolle Steven Tolle is a partner with HLM Venture Partners. He brings 30 years of commercial healthcare technology expertise in the areas of strategy, business development, and product management. Mr. Tolle has spent his career helping to develop and manage important themes in healthcare innovation and investment including artificial intelligence, diagnostic imaging/medical devices, electronic health records, population health, managed care and value-based pharmaceutical pricing. He currently sits on the boards of LetsGetChecked and PatientPop and is a board observer at VaxCare, Nordic Consulting and mPulse Mobile. Prior to joining HLM, he served as Chief Strategy Officer at Merge Healthcare, which was acquired by IBM in 2015. After his significant involvement in the transaction, Mr. Tolle was named Vice President of Global Strategy & Business Development at Watson Health Imaging. Prior to joining Merge, Mr. Tolle also served as Senior Vice President/General Manager at Optum from 2009 to 2011, Vice President of Product Management at Allscripts from 2007 to 2009, and Director of Product Management at Pfizer from 1996 to 2007. Wyche T. Green III Mr. Wyche "Tee" Green III is the Chief Executive Officer of 121G, LLC, an investment, business advisory and technology development firm he founded in 2013 where he helps start-up and growth stage company executives lead with purpose, accelerate revenue and intelligently scale operations. In addition, Mr. Green is the CEO and Chairman of the Board of Streamline Health Inc. (Nasdaq: STRM) and is a member of the boards of directors of several technology and healthcare companies, including Pelitas Inc., Elligo Health Research Inc., Sonic Tools USA, Caravan Health, ReferralPoint, Wellbox Inc., GreenCourt and Clearview Installations. Mr. Green is the former Executive Chairman and Chief Executive Officer of Greenway Health, where he served in leadership roles since its founding as Greenway Medical Technologies in 1998. Under Mr. Green s leadership as Chief Executive Officer, Greenway Health grew to $136 million at the time of its acquisition by Vitera Healthcare. In 2013, Mr. Green led Greenway Health through a go-private transaction with Vista Equity Partners where Greenway Health merged with Vitera Healthcare in a deal that valued Greenway Health at approximately $644 million. 89 Patrick B. Cline Patrick Cline currently serves as Chief Executive Officer of Lightbeam Health Solutions, Inc., a leader in population health management technology. Prior to Lightbeam, Mr. Cline founded and operated NextGen Healthcare (Nasdaq: NXGN, formerly known as Clinitec International, Inc.), an electronic health record and practice management IT company. Prior to NextGen, Mr. Cline was a software developer. Today, Mr. Cline is a respected strategist and highly experienced operator. He sits on multiple boards and coaches other executives in the areas of leadership, communication, teamwork and goal achievement. We believe the reputation and expertise of our management team and advisors in the healthcare industry will make us a desirable partner for potential business combination targets. Competitive Strengths Our mission is to create attractive risk-adjusted returns for our stockholders. We intend to acquire a platform company to build a category leader in healthcare technology or technology-enabled healthcare services with a durable long-term growth opportunity driven by macro-market trends and specific competitive advantage. We intend to capitalize on the ability of our management team and advisory board to identify, evaluate, acquire, and operate a business or businesses that will benefit from our team s differentiated collective experience and capabilities: Industry Knowledge: Healthcare is a broad, diverse, and local industry comprised of numerous sectors that each require unique institutional knowledge to be properly analyzed. Our management team, advisors, and sponsor can draw on vast experience to drive value creation for stockholders. Our team has expertise in virtually all subsectors of healthcare information technology, healthcare technology-enabled services and healthcare services including provider, payer, life sciences, consumer and employer solutions. In addition, we have significant experience in emerging areas of healthcare, including value-based care, population risk, population health, care coordination, condition management, virtual care, consumer engagement and pharmaceutical development. Investment Experience: Our management team and sponsor have evaluated thousands of, and invested in hundreds of, public and private companies. We have extensive experience assessing management teams, growth plans, strategic roadmaps, competitive differentiation, operational capabilities, technology infrastructures, and financial and accounting diligence materials. We believe that we can effectively and efficiently review large numbers of potential targets with a discerning view of valuation and expected risk-adjusted returns to determine whether the target(s) will be an appropriate candidate(s) for a potential business combination. Management Expertise: Our management team, directors and sponsor have decades of diverse experience operating healthcare businesses and driving value creation. The team has successfully led businesses in various stages of their lifecycle which should allow for a target to receive expert advice from a deep bench of industry experts and contacts. Our team has experience in all facets of growth and operations including deep knowledge of industry best practices across critical functional areas including marketing, sales, operations, business development, product strategy, product development, implementation, risk management and compliance, customer success, and finance and accounting. Moreover, our team s expertise will be an invaluable resource for management teams to lean on as they continue to operate in a highly regulated and complex marketplace. Sourcing: Our management team, directors and advisors have an extensive network of relationships with private and public companies, investment bankers, attorneys, accountants, private and public equity investors, industry executives, and advisors that we believe will provide proprietary deal-sourcing opportunities. Our management team, directors and advisors have grown their network by investing in, acquiring and growing businesses, while developing a reputation for integrity and fair dealing with all constituents. This network has provided our management team, directors and advisors with a flow of referrals from strategic investors, financial investors, payers, and providers, that has resulted in numerous proprietary transactions and participation in transaction processes in which a limited group of 90 investors were invited into the financing and sale processes. We believe that both active outreach and our network of contacts and relationships will provide us important sources of investment opportunities and a highly differentiated pipeline of targets. In addition, our management team, directors and advisors have executed transactions under varying economic and financial market conditions and have successfully navigated through numerous changes to healthcare policy and practice. Transaction Execution: Our management team and sponsor have collectively executed or advised on hundreds of investment, merger and acquisition, private placement, and public offering transactions during their careers. We believe that this experience will allow for flexible structuring solutions that create proper alignment between management and stockholders, as well as efficient negotiations and pricing. Capital Markets Expertise: Our management team is well-versed in capital markets activities, having advised many companies on capital markets transactions and having run multiple large and complex publicly-traded companies. This experience should allow our team to effectively position a target company with public-market investors. Additionally, the expertise of our management team in pursuing and consummating add-on acquisitions utilizing the flexibility of public-company capital structures is substantial. Governance Experience: Our management team and directors have extensive experience with board and governance matters through their roles as directors of public and private companies. Our officers and directors have served as board chairs as well as board committee chairs including Audit, Compensation, Strategy and Nominating and Governance Committees. Long-Term Perspective: Our management team is comprised of seasoned veterans from the healthcare information technology and services markets. As a result, our team understands that building great businesses can take time. We are focused on pursuing long-term value creation upon the consummation of a business combination. Acquisition Criteria Consistent with our strategy, we have identified the following general criteria and guidelines that are important in evaluating prospective target businesses. We will use this framework to evaluate acquisition opportunities, but we may decide to enter into our initial business combination with a target that does not meet all of these criteria and guidelines. We intend to target potential acquisitions that support one or more emerging sector themes including: Transitioning to value-based care and reimbursement and the impact of that transition across the healthcare ecosystem including evolution in contracting and reimbursement for providers, pharma/biotech and medical device companies. Continuing consumerization of healthcare and the importance of meaningful patient/member/employee engagement. Focusing on population health initiatives to drive sustainable improvement in health outcomes. Tracking, assessing, and impacting social determinants of health. Empowering the consumer around health decisions, including prevention, diagnosis and treatment. Broadening access to care through virtual care, multi-modal outreach, and hybrid or new care delivery models. Collecting, accessing and analyzing large data sets to drive insights into behavior and outcomes utilizing data visualization and artificial intelligence. Using real world evidence across the drug development value chain. 91 Improving healthcare provider and payer oversight with respect to governance, risk management, cyber-security, and compliance. Improving healthcare information technology infrastructure including the lack of healthcare data fluidity, increased demand for interoperability, and general productivity improvement. Improving coordination and management of care across multiple provider types and risk-bearing entities including addressing transitions of care along with institutional and home-based post-acute and chronic care. Improving the efficiency of healthcare staffing and labor access to address labor shortages and workforce management challenges. Our evaluation of potential acquisitions will include customary strategic, operational and financial reviews of the targets in tandem with the engagement of third-party advisors where appropriate. We intend to filter opportunities based on the following criteria: Growth Potential: multiple expansion vectors across organic opportunities and/or compelling acquisition opportunities. Sector Attractiveness: attractive macro-sector fundamentals and outlook with limited business model exposure to reimbursement and / or policy risk. Value Proposition: compelling value proposition to stakeholders within the healthcare ecosystem. Business Model/Stage: profitable business model or demonstrable ability to achieve profitability at scale where additional managerial, commercial, strategic and/or operational expertise will accelerate the pathway to profitability while maintaining a favorable growth trajectory. Competitive Position: leading or growing market share relative to peer group. Unrecognized Value: identifiable value-creation opportunities that can be unlocked leveraging the extensive operational and strategic knowledge and experience of our team. Public Market Readiness: strong management, corporate governance, and financial forecasting and reporting functions in place that will establish credibility with public investors and facilitate continued access to public capital markets. Valuation discipline: attractive risk-adjusted returns to our stockholders based on the fundamental business and the financial characteristics of the potential target. These criteria are not intended to be exhaustive. Any evaluation of a particular initial business combination may be based on these general guidelines as well as other considerations, factors, and criteria that our management team may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our stockholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation materials or tender offer documents that we would file with the U.S. Securities and Exchange Commission. We may need to obtain additional financing either to complete our initial business combination or because we become obligated to redeem a significant number of our public shares upon completion of our initial business combination. We intend to acquire a company, or companies that when aggregated, will have an enterprise value above the net proceeds of this offering and the sale of the placement units. Depending on the size of the transaction or the number of public shares we become obligated to redeem, we may potentially utilize several additional financing sources, including but not limited to the issuance of additional securities to the sellers of a target business, debt issued by banks or other lenders, a private placement, or a combination of the foregoing. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the trust account. In addition, following our initial business combination, if cash on hand is insufficient to meet our obligations or our working capital needs, we may need to obtain additional financing. 92 Ability to Extend Time to Complete Business Combination If we anticipate that we may not be able to consummate our initial business combination within 15 months from the consummation of this offering, we may, but are not obligated to, if requested by our sponsor or its affiliates, extend the period of time to consummate a business combination with up to two Paid Extensions (up to an additional six months) for a total of 21 months. In the case of the Paid Extension Period, public stockholders will not be offered the opportunity at the time of the extension to vote on or redeem their shares if we choose to make any such Paid Extension. As a result, we may conduct such an extension even though a majority of our public stockholders do not support such an extension and will not be able to redeem their shares in connection therewith. Pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order to avail ourselves of each Paid Extension to consummate our initial business combination, our sponsor or its affiliates or designees, upon five days advance notice prior to the then-applicable initial business combination deadline, must deposit into the trust account an amount per Paid Extension of $1,750,000, or $2,012,500 if the underwriters over-allotment option is exercised in full ($0.10 per share in either case), on or prior to the date of the then-applicable initial business combination deadline. Any such payments would be made in the form of a loan, which will be non-interest bearing and payable upon the consummation of our initial business combination. If we complete our initial business combination, we would repay such loaned amounts out of the proceeds of the trust account released to us or, at the option of the lender, convert such loaned amounts into private placement warrants of the post business combination entity at a price of $1.00 per warrant. In the event that we receive notice from our sponsor or its affiliates five days prior to the then-applicable initial business combination deadline of its wish for us to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the then-applicable initial business combination deadline announcing whether or not the funds had been timely deposited. Our sponsor and its affiliates or designees are obligated to fund the trust account to extend the time for us to complete our initial business combination, but our sponsor and its affiliates will not be obligated to extend such time. Initial Business Combination The rules of the NYSE require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the net assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. We refer to this as the 80% of net assets test. The fair market value of the target or targets will be determined by our board of directors based upon one or more standards generally accepted by the financial community (such as actual and potential sales, earnings, cash flow and/or book value). Even though our board of directors will rely on generally accepted standards, our board of directors will have discretion to select the standards employed. In addition, the application of the standards generally involves a substantial degree of judgment. Accordingly, investors will be relying on the business judgment of the board of directors in evaluating the fair market value of the target or targets. The proxy solicitation materials or tender offer documents used by us in connection with any proposed transaction will provide public stockholders with our analysis of our satisfaction of the 80% of net assets test, as well as the basis for our determinations. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm which is a member of FINRA or a valuation or appraisal firm with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. We will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. 93 Our Acquisition Process In evaluating a prospective target business, we expect to conduct a thorough due diligence review which will encompass, among other things, meetings with incumbent management and employees, document reviews, technology reviews, industry research and reviews, as well as review of financial, operational, legal and other information which will be made available to us. We will also utilize our operational and capital planning experience to evaluate the proprietary opportunity. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm that is a member of FINRA, or from an independent accounting firm, that our initial business combination is fair to our company from a financial point of view. Members of our management team and sponsor may directly or indirectly own our common stock and/or private placement warrants following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. In particular, because the founder shares were purchased at a purchase price of approximately $0.005 per share, the holders of our founder shares (including certain members of our management team that directly or indirectly own founder shares) could make a substantial profit after our initial business combination even if our public stockholders lose money on their investment as a result of a decrease in the post-business combination value of their shares of Class A common stock (after accounting for any adjustments in connection with an exchange or other transaction contemplated by the business combination). Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. We currently do not have any specific business combination under consideration. Our officers and directors have neither individually identified nor considered a target business for our initial business combination. We have not, nor has anyone on our behalf, taken any measure, directly or indirectly, to identify or locate any suitable acquisition candidate for us, nor have we engaged or retained any agent or other representative to identify or locate any such acquisition candidate. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such entity, subject to his or her fiduciary duties under Delaware law. We expect that if an opportunity is presented to one of our officers or directors in his or her capacity as an officer or director of one of those other entities, such opportunity would be presented to such other entity and not to us. For more information on the entities to which our officers and directors currently have fiduciary or contractual obligations, please refer to "Management — Conflicts of Interest." We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our initial business combination. Sourcing of Potential Business Combination Targets We believe our management team s significant operating and transaction experience and relationships with companies will provide us with a substantial number of potential business combination targets. Over the course of their careers, the members of our management team have developed a broad network of contacts and corporate relationships around the world. This network has grown through the activities of our management team sourcing, acquiring, financing and selling businesses, our management team s relationships with sellers, financing sources and target management teams and the experience of our management team in executing transactions under varying economic and financial market conditions. In addition, members of our management team have developed contacts from serving on the boards of directors of several companies. 94 We believe this network provides our management team with a robust and consistent flow of acquisition opportunities which were proprietary or where a limited group of investors were invited to participate in the sale process. We believe that the network of contacts and relationships of our management team will provide us with important sources of acquisition opportunities. In addition, we anticipate that target business candidates will be brought to our attention from various unaffiliated sources, including investment market participants, private equity funds and large business enterprises seeking to divest non-core assets or divisions. As more fully discussed in "Management — Conflicts of Interest," if any of our directors or officers becomes aware of a business combination opportunity that falls within the line of business of any entity to which he or she has pre-existing fiduciary or contractual obligations, he or she may be required to present such business combination opportunity to such entity prior to presenting such business combination opportunity to us. Our directors and officers currently have fiduciary duties or contractual obligations that may take priority over their duties to us. Our executive offices are located at 40 Burton Hills Boulevard, Suite 100, Nashville, Tennessee 37215 and our telephone number is (615) 601-1090. Status as a Public Company We believe our structure will make us an attractive business combination partner to target businesses. As an existing public company, we offer target businesses an alternative to the traditional initial public offering through a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination. In this situation, the owners of the target business would exchange their capital stock, shares or other equity securities in the target business for our shares or for a combination of our shares and cash, allowing us to tailor the consideration to the specific needs of the sellers. Although there are various costs and obligations associated with being a public company, we believe target businesses will find this method a more certain and cost effective method to becoming a public company than the typical initial public offering. In a typical initial public offering, there are additional expenses incurred in marketing, road show and public reporting efforts that may not be present to the same extent in connection with a business combination with us. Furthermore, once a proposed business combination is completed, the target business will have effectively become public, whereas an initial public offering is always subject to the underwriters ability to complete the offering, as well as general market conditions, which could delay or prevent the offering from occurring. Once public, we believe the target business would then have greater access to capital and an additional means of providing management incentives consistent with stockholders interests. It can offer further benefits by augmenting a company s profile among potential new customers and vendors and aid in attracting talented employees. We are an "emerging growth company," as defined in the JOBS Act. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock held by non-affiliates equaled or exceeded $700 million as of the end of that year s second fiscal quarter, and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. Additionally, we are a "smaller reporting company" as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates equals or exceeds $250 million as of the end of that year s second fiscal quarter, or (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates equaled or exceeded $700 million as of the end of that year s second fiscal quarter. Financial Position With funds available for a business combination initially in the amount of $172,375,000 assuming no redemptions and after payment of $6,125,000 of deferred underwriting fees (or $198,231,250 assuming no redemptions and after payment of $7,043,750 of deferred underwriting fees if the underwriters over-allotment option is exercised in full), in each case, after estimated offering expenses of $750,000 and full spend of the working capital held outside the trust account, we offer a target business a variety of options such as creating a liquidity event for its 95 owners, providing capital for the potential growth and expansion of its operations or strengthening its balance sheet by reducing its debt ratio. Because we are able to complete our initial business combination using our cash, debt or equity securities, or a combination of the foregoing, we have the flexibility to use the most efficient combination that will allow us to tailor the consideration to be paid to the target business to fit its needs and desires. However, we have not taken any steps to secure third-party financing and there can be no assurance it will be available to us. Effecting Our Initial Business Combination We are not presently engaged in, and we will not engage in, any operations for an indefinite period of time following this offering. We intend to effectuate our initial business combination using cash from the proceeds of this offering and the sale of the private placement warrants, our shares (including to the target or pursuant to forward purchase agreements or backstop agreements we may enter into following the consummation of this offering or otherwise), debt or a combination of these as the consideration to be paid in our initial business combination. We may seek to complete our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, which would subject us to the numerous risks inherent in such companies and businesses. If our initial business combination is paid for using equity or debt, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or the redemptions of our public shares, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of the post-transaction company, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. We have not selected any business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. We may seek to raise additional funds through a private offering of debt or equity securities in connection with the completion of our initial business combination, and we may effectuate our initial business combination using the proceeds of such offering rather than using the amounts held in the trust account. In the case of an initial business combination funded with assets other than the trust account assets, our tender offer documents or proxy materials disclosing the business combination would disclose the terms of the financing and, only if required by law or we decide to do so for business or other reasons, we would seek stockholder approval of such financing. There are no prohibitions on our ability to raise funds privately or through loans in connection with our initial business combination. At this time, we are not a party to any arrangement or understanding with any third party with respect to raising any additional funds through the sale of securities or otherwise. Selection of a target business and structuring of our initial business combination The rules of the NYSE require that our initial business combination must be with one or more operating businesses or assets with a fair market value equal to at least 80% of the assets held in the trust account (excluding any deferred underwriters fees and taxes payable on the income earned on the trust account). We refer to this as the 80% of net assets test. The fair market value of the target or targets will be determined by our board of directors based upon one or more standards generally accepted by the financial community, such as discounted cash flow valuation or value of comparable businesses. If our board of directors is not able independently to determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm, or another independent entity that commonly renders valuation opinions, with respect to the satisfaction of such criteria. We do not currently intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination, although there is no assurance that will be the case. Subject to this requirement, our management will have virtually unrestricted flexibility in identifying and selecting one or more prospective target businesses, although we will not be permitted to effectuate our initial business combination solely with another blank check company or a similar company with nominal operations. In any case, we will only complete an initial business combination if the post-transaction company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment 96 Company Act. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. There is no basis for investors in this offering to evaluate the possible merits or risks of any target business with which we may ultimately complete our initial business combination. To the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors. In evaluating a prospective target business, we expect to conduct a thorough due diligence review which may encompass, among other things, meetings with incumbent management and employees, document reviews, inspection of facilities, as well as a review of financial, operational, legal and other information, which will be made available to us. The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the funds we can use to complete another business combination. Lack of business diversification For an indefinite period of time after the completion of our initial business combination, the prospects for our success may depend entirely on the future performance of a single business. Unlike other entities that have the resources to complete business combinations with multiple entities in one or several industries, it is probable that we will not have the resources to diversify our operations and mitigate the risks of being in a single line of business. By completing our initial business combination with only a single entity, our lack of diversification may: subject us to negative economic, competitive and regulatory developments, any or all of which may have a substantial adverse impact on the particular industry in which we operate after our initial business combination; and cause us to depend on the marketing and sale of a single product or limited number of products or services. Limited ability to evaluate the target s management team Although we intend to closely scrutinize the management of a prospective target business when evaluating the desirability of effecting our initial business combination with that business, our assessment of the target business s management may not prove to be correct. In addition, the future management may not have the necessary skills, qualifications or abilities to manage a public company. Furthermore, the future role of members of our management team, if any, in the target business cannot presently be stated with any certainty. While it is possible that one or more of our directors will remain associated in some capacity with us following our initial business combination, it is unlikely that any of them will devote their full efforts to our affairs subsequent to our initial business combination. Moreover, we cannot assure you that members of our management team will have significant experience or knowledge relating to the operations of the particular target business. We cannot assure you that any of our key personnel will remain in senior management or advisory positions with the combined company. The determination as to whether any of our key personnel will remain with the combined company will be made at the time of our initial business combination. Following our initial business combination, we may seek to recruit additional managers to supplement the incumbent management of the target business. We cannot assure you that we will have the ability to recruit additional managers, or that additional managers will have the requisite skills, knowledge or experience necessary to enhance the incumbent management. 97 Stockholders may not have the ability to approve our initial business combination We may conduct redemptions without a stockholder vote pursuant to the tender offer rules of the SEC subject to the provisions of our amended and restated certificate of incorporation. However, we will seek stockholder approval if it is required by applicable law or stock exchange listing requirement, or we may decide to seek stockholder approval for business or other reasons. Under the rules of the NYSE, stockholder approval would be required for our initial business combination if, for example: we issue shares of Class A common stock (other than in a public offering) that will either (a) be equal to or in excess of 20% of the number of shares of Class A common stock then outstanding or (b) have voting power equal to or in excess of 20% of the voting power then outstanding; any of our directors, officers or substantial stockholders (as defined by the NYSE rules) has a 5% or greater interest, directly or indirectly, in the target business or assets to be acquired and the number of shares of Class A common stock to be issued, or if the number of shares of Class A common stock into which the securities may be convertible or exercisable, exceeds either (a) common shares or voting power of 1% outstanding before the issuance in the case of any of our directors or officers or (b) common shares or voting power of 5% or more in the case of any substantial stockholders; or the issuance or potential issuance of common stock will result in our undergoing a change of control. Permitted purchases and other transactions with respect to our securities In the event we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, officers, advisors or any of their affiliates may purchase public shares or warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. There is no limit on the number of securities such persons may purchase. Additionally, at any time at or prior to our initial business combination, subject to applicable securities laws (including with respect to material nonpublic information), our sponsor, directors, officers, advisors or any of their affiliates may enter into transactions with investors and others to provide them with incentives to acquire public shares, vote their public shares in favor of our initial business combination or not redeem their public shares. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. In the event our initial stockholders, directors, officers, advisors or any of their affiliates determine to undertake any such transactions, such transactions could have the effect of influencing the vote necessary to approve such transaction. None of the funds held in the trust account will be used to purchase public shares or warrants in such transactions. They will be restricted from making any such purchases when they are in possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. Such a purchase may include a contractual acknowledgement that such stockholder, although still the record holder of our shares, is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights. Subsequent to the consummation of this offering, we will adopt an insider trading policy which will require insiders to (1) refrain from purchasing securities during certain blackout periods and when they are in possession of any material non-public information and (2) clear certain trades prior to execution. We cannot currently determine whether our insiders will make such purchases pursuant to a Rule 10b5-1 plan, as it will be dependent upon several factors, including but not limited to, the timing and size of such purchases. Depending on such circumstances, our insiders may either make such purchases pursuant to a Rule 10b5-1 plan or determine that such a plan is not necessary. In the event that our sponsor, directors, officers, advisors or any of their affiliates purchase shares in privately negotiated transactions from public stockholders who have already elected to exercise their redemption rights or submitted a proxy to vote against our initial business combination, such selling stockholders would be required to revoke their prior elections to redeem their shares and any proxy to vote against our initial business combination. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will be required to comply with such rules. 98 The purpose of such a transaction could be to (1) vote in favor of the business combination and thereby increase the likelihood of obtaining stockholder approval of our initial business combination, (2) reduce the number of public warrants outstanding or vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination or (3) satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. This may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public "float" of our securities and the number of beneficial holders of our securities may be reduced, possibly making it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Our sponsor, directors, officers, advisors and/or any of their affiliates anticipate that they may identify the stockholders with whom our sponsor, directors, officers, advisors or any of their affiliates may pursue privately negotiated transactions by either the stockholders contacting us directly or by our receipt of redemption requests submitted by stockholders (in the case of public shares) following our mailing of tender offer or proxy materials in connection with our initial business combination. To the extent that our sponsor, directors, officers, advisors or any of their affiliates enter into a private transaction, they would identify and contact only potential selling or redeeming stockholders who have expressed their election to redeem their shares for a pro rata share of the trust account or vote against our initial business combination. Such persons would select the stockholders from whom to acquire shares based on the number of shares available, the negotiated price per share and such other factors as any such person may deem relevant at the time of purchase. The price per share paid in any such transaction may be different than the amount per share a public stockholder would receive if it elected to redeem its shares in connection with our initial business combination. Our sponsor, directors, officers, advisors or any of their affiliates will be restricted from purchasing shares if such purchases do not comply with Regulation M under the Exchange Act and the other federal securities laws. Any purchases by our sponsor, directors, officers and/or any of their affiliates who are affiliated purchasers under Rule 10b-18 under the Exchange Act will be restricted unless such purchases are made in compliance with Rule 10b-18, which is a safe harbor from liability for manipulation under Section 9(a)(2) of, and Rule 10b-5 under, the Exchange Act. Rule 10b-18 has certain technical requirements that must be complied with in order for the safe harbor to be available to the purchaser. Our sponsor, directors, officers and/or any of their affiliates will be restricted from making purchases of common stock if the purchases would violate Section 9(a)(2) of, or Rule 10b-5 under, the Exchange Act. Redemption rights for public stockholders upon completion of our initial business combination We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of the initial business combination, including interest (which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares, subject to the limitations described herein. At the completion of our initial business combination, we will be required to purchase any common stock properly delivered for redemption and not withdrawn. The amount in the trust account is initially anticipated to be $10.20 per public share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. The redemption rights will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our initial stockholders, directors and officers have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and public shares held by them in connection with the completion of our initial business combination. Manner of Conducting Redemptions We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (1) in connection with a stockholder meeting called to approve the business combination or (2) by means of a tender offer. The decision as to whether we will seek 99 stockholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval under applicable law or stock exchange listing requirement. Asset acquisitions and share purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our issued and outstanding common stock or seek to amend our amended and restated certificate of incorporation would typically require stockholder approval. We intend to conduct redemptions without a stockholder vote pursuant to the tender offer rules of the SEC unless stockholder approval is required by applicable law or stock exchange listing requirement or we choose to seek stockholder approval for business or other reasons. If a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other reasons, we will, pursuant to our amended and restated certificate of incorporation: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E under the Exchange Act, which regulate issuer tender offers; and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A under the Exchange Act, which regulates the solicitation of proxies. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we and our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase our common stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public stockholders not tendering more than a specified number of public shares, which number will be based on the requirement that we may not redeem public shares in an amount that would cause our net tangible assets to be less than $5,000,001 following such redemptions, or any greater net tangible asset or cash requirement that may be contained in the agreement relating to our initial business combination. If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete such initial business combination. If, however, stockholder approval of the transaction is required by applicable law or stock exchange listing requirement, or we decide to obtain stockholder approval for business or other reasons, we will, pursuant to our amended and restated certificate of incorporation: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A under the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and file proxy materials with the SEC. We expect that a final proxy statement would be mailed to public stockholders at least 10 days prior to the stockholder vote. However, we expect that a draft proxy statement would be made available to such stockholders well in advance of such time, providing additional notice of redemption if we conduct redemptions in conjunction with a proxy solicitation. Although we are not required to do so, we currently intend to comply with the substantive and procedural requirements of Regulation 14A in connection with any stockholder vote even if we are not able to maintain our NYSE listing or Exchange Act registration. In the event that we seek stockholder approval of our initial business combination, we will distribute proxy materials and, in connection therewith, provide our public stockholders with the redemption rights described above upon completion of the initial business combination. If we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the Company representing a majority of the voting power of all outstanding shares of capital stock of the Company 100 entitled to vote at such meeting. In such case, pursuant to the terms of a letter agreement entered into with us, our initial stockholders have agreed (and their permitted transferees will agree) to vote their founder shares and any public shares held by them in favor of our initial business combination. Our directors and officers also have agreed to vote in favor of our initial business combination with respect to public shares acquired by them, if any. We expect that at the time of any stockholder vote relating to our initial business combination, our initial stockholders and their permitted transferees will own at least 20% of our issued and outstanding common stock entitled to vote thereon. Each public stockholder may elect to redeem their public shares without voting and, if they do vote, irrespective of whether they vote for or against the proposed transaction. In addition, our initial stockholders, directors and officers have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and public shares held by them in connection with the completion of a business combination. Our amended and restated certificate of incorporation will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 following such redemptions. Redemptions of our public shares may also be subject to a higher net tangible asset test or cash requirement pursuant to an agreement relating to our initial business combination. For example, the proposed business combination may require: (1) cash consideration to be paid to the target or its owners; (2) cash to be transferred to the target for working capital or other general corporate purposes; or (3) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration we would be required to pay for all public shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all common stock submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate business combination. Limitation on redemption upon completion of our initial business combination if we seek stockholder approval Notwithstanding the foregoing redemption rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a "group" (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to Excess Shares, without our prior consent. We believe this restriction will discourage stockholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to exercise their redemption rights against a proposed business combination as a means to force us or our sponsor or its affiliates to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public stockholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights if such holder s shares are not purchased by us or our sponsor or its affiliates at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders ability to vote all of their shares (including Excess Shares) for or against our initial business combination. Tendering share certificates in connection with a tender offer or redemption rights We may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in "street name," to either tender their certificates to our transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up to two business days prior to the initially scheduled vote on the proposal to approve the business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically using The Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, rather than simply voting against the initial business combination. The tender offer or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public stockholders to satisfy such delivery requirements, which will include the requirement that a beneficial holder must identify itself in order 101 to validly redeem its shares. Accordingly, a public stockholder would have from the time we send out our tender offer materials until the close of the tender offer period, or up to two business days prior to the initially scheduled vote on the business combination if we distribute proxy materials, as applicable, to tender its shares if it wishes to seek to exercise its redemption rights. Pursuant to the tender offer rules, the tender offer period will be not less than 20 business days and, in the case of a stockholder vote, a final proxy statement would be mailed to public stockholders at least 10 days prior to the stockholder vote. However, we expect that a draft proxy statement would be made available to such stockholders well in advance of such time, providing additional notice of redemption if we conduct redemptions in conjunction with a proxy solicitation. Given the relatively short exercise period, it is advisable for stockholders to use electronic delivery of their public shares. There is a nominal cost associated with the above-referenced tendering process and the act of certificating the shares or delivering them through the DWAC System. The transfer agent will typically charge the tendering broker a fee of approximately $80.00 and it would be up to the broker whether or not to pass this cost on to the redeeming holder. However, this fee would be incurred regardless of whether or not we require holders seeking to exercise redemption rights to tender their shares. The need to deliver shares is a requirement of exercising redemption rights regardless of the timing of when such delivery must be effectuated. The foregoing is different from the procedures used by many blank check companies. In order to perfect redemption rights in connection with their business combinations, many blank check companies would distribute proxy materials for the stockholders vote on an initial business combination, and a holder could simply vote against a proposed business combination and check a box on the proxy card indicating such holder was seeking to exercise his or her redemption rights. After the business combination was approved, the company would contact such stockholder to arrange for him or her to deliver his or her certificate to verify ownership. As a result, the stockholder then had an "option window" after the completion of the business combination during which he or she could monitor the price of the company s shares in the market. If the price rose above the redemption price, he or she could sell his or her shares in the open market before actually delivering his or her shares to the company for cancellation. As a result, the redemption rights, to which stockholders were aware they needed to commit before the annual meeting, would become "option" rights surviving past the completion of the business combination until the redeeming holder delivered its certificate. The requirement for physical or electronic delivery prior to the meeting ensures that a redeeming holder s election to redeem is irrevocable once the business combination is approved. Any request to redeem such shares, once made, may be withdrawn at any time up to the date set forth in the tender offer materials or two business days prior to the scheduled date of the annual meeting set forth in our proxy materials, as applicable (unless we elect to allow additional withdrawal rights). Furthermore, if a holder of a public share delivered its certificate in connection with an election of redemption rights and subsequently decides prior to the applicable date not to elect to exercise such rights, such holder may simply request that the transfer agent return the certificate (physically or electronically). It is anticipated that the funds to be distributed to holders of our public shares electing to redeem their shares will be distributed promptly after the completion of our initial business combination. If our initial business combination is not approved or completed for any reason, then our public stockholders who elected to exercise their redemption rights would not be entitled to redeem their shares for the applicable pro rata share of the trust account. In such case, we will promptly return any certificates delivered by public holders who elected to redeem their shares. If our initial proposed business combination is not completed, we may continue to try to complete a business combination with a different target until 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering. Redemption of public shares and liquidation if no initial business combination Our sponsor, directors and officers have agreed that we will have only 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering to complete our initial business combination. If we have not completed our initial business combination within such 15-month period (subject to any extensions), we will: (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably possible but not more than 10 business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (less up to $100,000 of interest to pay dissolution expenses and which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares, which redemption will completely extinguish 102 public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any); and (3) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within the 15-month time period (subject to any extensions). Our initial stockholders have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering. However, if our initial stockholders acquire public shares, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted 15-month time period (subject to any extensions). Our sponsor, directors and officers have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering or (B) with respect to any other material provision relating to Class A common stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of Class A common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares. However, we may not redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 following such redemptions. We expect that all costs and expenses associated with implementing our plan of dissolution, as well as payments to any creditors, will be funded from amounts remaining out of the $1,950,000 of proceeds held outside the trust account, although we cannot assure you that there will be sufficient funds for such purpose. However, if those funds are not sufficient to cover the costs and expenses associated with implementing our plan of dissolution, to the extent that there is any interest accrued in the trust account not required to pay taxes, we may request the trustee to release to us an additional amount of up to $100,000 of such accrued interest to pay those costs and expenses. If we were to expend all of the net proceeds of this offering and the sale of the private placement warrants, other than the proceeds deposited in the trust account, and without taking into account interest, if any, earned on the trust account, the per-share redemption amount received by stockholders upon our dissolution would be approximately $10.20. The proceeds deposited in the trust account could, however, become subject to the claims of our creditors which would have higher priority than the claims of our public stockholders. We cannot assure you that the actual per-share redemption amount received by stockholders will not be substantially less than $10.20. While we intend to pay such amounts, if any, we cannot assure you that we will have funds sufficient to pay or provide for all creditors claims. Although we will seek to have all vendors, service providers (other than our independent registered public accounting firm), prospective target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our public stockholders, there is no guarantee that they will execute such agreements or even if they execute such agreements that they would be prevented from bringing claims against the trust account including but not limited to fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain an advantage with respect to a claim against our assets, including the funds held in the trust account. If any third party refuses to execute an agreement waiving such claims to the monies held in the trust account, our management will perform an analysis of the alternatives available to it and will enter into an agreement with a third party that has not executed a waiver only if management believes that such third party s engagement would be significantly more beneficial to us than any alternative. Examples of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third-party consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where we are unable to find a service provider willing to execute a waiver. In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason. Upon redemption of our 103 public shares, if we have not completed our initial business combination within the required time period, or upon the exercise of a redemption right in connection with our initial business combination, we will be required to provide for payment of claims of creditors that were not waived that may be brought against us within the 10 years following redemption. Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party (other than our independent registered public accounting firm) for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (1) $10.20 per public share or (2) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account, due to reductions in value of the trust assets, in each case net of the amount of interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. In the event that an executed waiver is deemed to be unenforceable against a third party, then our sponsor will not be responsible to the extent of any liability for such third-party claims. We have not independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that our sponsor s only assets are securities of our company and, therefore, our sponsor may not be able to satisfy those obligations. None of our other officers will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses. In the event that the proceeds in the trust account are reduced below (1) $10.20 per public share or (2) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account, due to reductions in value of the trust assets, in each case net of the amount of interest which may be withdrawn to pay taxes, and our sponsor asserts that it is unable to satisfy its indemnification obligations or that it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take legal action against our sponsor to enforce its indemnification obligations. While we currently expect that our independent directors would take legal action on our behalf against our sponsor to enforce its indemnification obligations to us, it is possible that our independent directors in exercising their business judgment may choose not to do so in any particular instance. Accordingly, we cannot assure you that due to claims of creditors the actual value of the per-share redemption price will not be substantially less than $10.20 per share. We will seek to reduce the possibility that our sponsor will have to indemnify the trust account due to claims of creditors by endeavoring to have all vendors, service providers (other than our independent registered public accounting firm), prospective target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to monies held in the trust account. Our sponsor will also not be liable as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. We will have access to up to $1,950,000 from the proceeds of this offering and the sale of the private placement warrants, with which to pay any such potential claims (including costs and expenses incurred in connection with our liquidation, currently estimated to be no more than approximately $100,000). In the event that we liquidate and it is subsequently determined that the reserve for claims and liabilities is insufficient, stockholders who received funds from our trust account could be liable for claims made by creditors. In the event that our offering expenses exceed our estimate of $750,000, we may fund such excess with funds from the funds not to be held in the trust account. In such case, the amount of funds we intend to be held outside the trust account would decrease by a corresponding amount. Conversely, in the event that the offering expenses are less than our estimate of $750,000, the amount of funds we intend to be held outside the trust account would increase by a corresponding amount. If we file a winding-up or bankruptcy or insolvency petition or an involuntary winding-up or bankruptcy or insolvency petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable insolvency law, and may be included in our insolvency estate and subject to the claims of third parties with priority over the claims of our stockholders. To the extent any insolvency claims deplete the trust account, we cannot assure you we will be able to return $10.20 per share to our public stockholders. Additionally, if we file a winding-up or bankruptcy or insolvency petition or an involuntary winding-up or bankruptcy or insolvency petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or insolvency laws as a voidable performance. As a result, a bankruptcy court could seek to recover some or all amounts received by our stockholders. Furthermore, our board of directors may be viewed as having breached its fiduciary duty to our creditors and/or may have acted in bad faith, and thereby exposing itself and our company to claims of punitive damages, by paying public stockholders from the trust account prior to addressing the claims of creditors. We cannot assure you that claims will not be brought against us for these reasons. 104 Our public stockholders will be entitled to receive funds from the trust account only upon the earliest to occur of: (1) our completion of an initial business combination, and then only in connection with those shares of Class A common stock that such stockholder properly elected to redeem, subject to the limitations described herein; (2) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering or (B) with respect to any other material provision relating to Class A common stockholders rights or pre-initial business combination activity; and (3) the redemption of our public shares if we have not completed an initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, subject to applicable law. In no other circumstances will a stockholder have any right or interest of any kind to or in the trust account. Holders of warrants will not have any right to the proceeds held in the trust account with respect to the warrants. Amended and Restated Certificate of Incorporation Our amended and restated certificate of incorporation will contain certain requirements and restrictions relating to this offering that will apply to us until the completion of our initial business combination. These provisions cannot be amended without the approval of the holders of 65% of our common stock. Our initial stockholders, who will collectively beneficially own 20% of our common stock upon the closing of this offering (assuming they do not purchase any units in this offering), may participate in any vote to amend our amended and restated certificate of incorporation and will have the discretion to vote in any manner they choose. Specifically, our amended and restated certificate of incorporation will provide, among other things, that: If we are unable to complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but no more than ten business days thereafter, redeem the public shares, at a per- share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Delaware law to provide for claims of creditors and in all cases subject to the requirements of other applicable law; Prior to our initial business combination, we may not issue additional securities that would entitle the holders thereof to (i) receive funds from the trust account or (ii) vote as a class with our public shares (a) on our initial business combination or (b) to approve an amendment to our amended and restated certificate of incorporation to (x) extend the time we have to consummate a business combination beyond 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering or (y) amend the foregoing provisions; Although we do not intend to enter into a business combination with a target business that is affiliated with our sponsor, our directors or our executive officers, we are not prohibited from doing so. In the event we enter into such a transaction, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm which is a member of FINRA or a valuation or appraisal firm that such a business combination is fair to our company from a financial point of view; If a stockholder vote on our initial business combination is not required by law and we do not decide to hold a stockholder vote for business or other legal reasons, we will offer to redeem our public shares pursuant to Rule 13e-4 and Regulation 14E under the Exchange Act, and will file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about our initial business combination and the redemption rights as is required under Regulation 14A under the Exchange Act. Whether or not we maintain our registration under the Exchange Act or our listing on the NYSE, we will provide our public stockholders with the opportunity to redeem their public shares by one of the two methods listed above; 105 Our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (excluding the amount of deferred underwriting discounts held in trust and taxes payable on the income earned on the trust account) at the time of the agreement to enter into the initial business combination; If our stockholders approve an amendment to our amended and restated certificate of incorporation to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, or with respect to any other material provisions relating to Class A common stockholders rights or pre-initial business combination activity, we will provide our public stockholders with the opportunity to redeem all or a portion of their Class A common stock upon such approval at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations described herein; and We will not effectuate our initial business combination solely with another blank check company or a similar company with nominal operations. In addition, our amended and restated certificate of incorporation will provide that under no circumstances will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001. Comparison of redemption or purchase prices in connection with our initial business combination and if we fail to complete our initial business combination. The following table compares the redemptions and other permitted purchases of public shares that may take place in connection with the completion of our initial business combination and if we have not completed our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering. Redemptions in Connection with our Initial Business Combination Other Permitted Purchases of Public Shares by our Affiliates Redemptions if we fail to Complete an Initial Business Combination Calculation of redemption price Redemptions at the time of our initial business combination may be made pursuant to a tender offer or in connection with a stockholder vote. The redemption price will be the same whether we conduct redemptions pursuant to a tender offer or in connection with a stockholder vote. In either case, our public stockholders may redeem their public shares for cash equal to the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of the initial business combination (which is initially anticipated to be $10.20 per share), including interest (which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares, If we seek stockholder approval of our initial business combination, our sponsor, directors, officers, advisors or any of their affiliates may purchase public shares or warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Such purchases will be restricted except to the extent such purchases are able to be made in compliance with Rule 10b-18, which is a safe harbor from liability for manipulation under Section 9(a)(2) of, and Rule 10b-5 under, the Exchange Act. None of the funds in the trust account will be used to purchase shares in such transactions. If we have not completed our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, we will redeem all public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account (which is initially anticipated to be $10.20 per share), including interest (less up to $100,000 of interest to pay dissolution expenses and which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares. 106 Redemptions in Connection with our Initial Business Combination Other Permitted Purchases of Public Shares by our Affiliates Redemptions if we fail to Complete an Initial Business Combination subject to the limitation that no redemptions will take place if all of the redemptions would cause our net tangible assets to be less than $5,000,001 following such redemptions, and any limitations (including, but not limited to, cash requirements) agreed to in connection with the negotiation of terms of a proposed business combination. Impact to remaining stockholders The redemptions in connection with our initial business combination will reduce the book value per share for our remaining stockholders, who will bear the burden of the deferred underwriting commissions and interest withdrawn in order to pay taxes (to the extent not paid from amounts accrued as interest on the funds held in the trust account). If the permitted purchases described above are made, there will be no impact to our remaining stockholders because the purchase price would not be paid by us. The redemption of our public shares if we fail to complete our initial business combination will reduce the book value per share for the shares held by our initial stockholders, who will be our only remaining stockholders after such redemptions. Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419 The following table compares the terms of this offering to the terms of an offering by a blank check company subject to the provisions of Rule 419. This comparison assumes that the gross proceeds, underwriting commissions and underwriting expenses of our offering would be identical to those of an offering undertaken by a company subject to Rule 419, and that the underwriters will not exercise their over-allotment option. None of the provisions of Rule 419 apply to our offering. Terms of Our Offering Terms Under a Rule 419 Offering Escrow of offering proceeds The rules of the NYSE provide that at least 90% of the gross proceeds from this offering and the sale of the private placement warrants be deposited in a trust account. $178,500,000 of the net proceeds of this offering and the sale of the private placement warrants will be deposited into a U.S.-based trust account J.P. Morgan Chase Bank, N.A. with Continental Stock Transfer & Trust Company acting as trustee. Approximately $148,837,500 of the offering proceeds, representing the gross proceeds of this offering less allowable underwriting commissions under Rule 419, would be required to be deposited into either an escrow account with an insured depositary institution or in a separate bank account established by a broker-dealer in which the broker-dealer acts as trustee for persons having the beneficial interests in the account. Investment of net proceeds $178,500,000 of the net offering proceeds and the sale of the private placement warrants held in trust will be invested only in U.S. government treasury bills with a maturity of 185 days or less or in money market funds investing solely in U.S. Treasuries and meeting certain conditions under Rule 2a-7 under the Investment Company Act. Proceeds could be invested only in specified securities such as a money market fund meeting conditions of the Investment Company Act or in securities that are direct obligations of, or obligations guaranteed as to principal or interest by, the United States. 107 Terms of Our Offering Terms Under a Rule 419 Offering Receipt of interest on escrowed funds Interest on proceeds from the trust account to be paid to stockholders is reduced by (1) any taxes paid or payable and (2) in the event of our liquidation for failure to complete our initial business combination within the allotted time, up to $100,000 of net interest that may be released to us should we have no or insufficient working capital to fund the costs and expenses of our dissolution and liquidation. Interest on funds in escrow account would be held for the sole benefit of investors, unless and only after the funds held in escrow were released to us in connection with our completion of a business combination. Limitation on fair value or net assets of target business The rules of the NYSE require that our initial business combination must be with one or more operating businesses or assets with a fair market value equal to at least 80% of the assets held in the trust account (excluding any deferred underwriters fees and taxes payable on the income earned on the trust account). The fair value or net assets of a target business must represent at least 80% of the maximum offering proceeds. Trading of securities issued The units will begin trading on or promptly after the date of this prospectus. The shares of Class A common stock and warrants constituting the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless William Blair informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. We will file the Current Report on Form 8-K promptly after the closing of this offering. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. No trading of the units or the underlying common stock and warrants would be permitted until the completion of a business combination. During this period, the securities would be held in the escrow or trust account. Exercise of the warrants The warrants cannot be exercised until the later of 30 days after the completion of our initial business combination or 12 months from the closing of this offering. The warrants could be exercised prior to the completion of a business combination, but securities received and cash paid in connection with the exercise would be deposited in the escrow or trust account. 108 Terms of Our Offering Terms Under a Rule 419 Offering Election to remain an investor We will provide our public stockholders with the opportunity to redeem their public shares for cash equal to their pro rata share of the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of our initial business combination, including interest, which interest shall be net of taxes payable, upon the completion of our initial business combination, subject to the limitations described herein. We may not be required by law to hold a stockholder vote. If we are not required by applicable law or stock exchange rules and do not otherwise decide to hold a stockholder vote, we will, pursuant to our amended and restated certificate of incorporation, conduct the redemptions pursuant to the tender offer rules of the SEC and file tender offer documents with the SEC which will contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under the SEC s proxy rules. If, however, we hold a stockholder vote, we will, like many blank check companies, offer to redeem shares in conjunction with a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer rules. Pursuant to the tender offer rules, the tender offer period will be not less than 20 business days and, in the case of a stockholder vote, a final proxy statement would be mailed to public stockholders at least 10 days prior to the stockholder vote. However, we expect that a draft proxy statement would be made available to such stockholders well in advance of such time, providing additional notice of redemption if we conduct redemptions in conjunction with a proxy solicitation. If we seek stockholder approval, we will complete our initial business combination only if we receive only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the Company representing a majority of the voting power of all outstanding shares of capital stock of the Company entitled to vote at such meeting. Additionally, each public stockholder may elect to redeem its public shares without voting and, if they do vote, irrespective of whether they vote for or against the proposed transaction. A prospectus containing information pertaining to the business combination required by the SEC would be sent to each investor. Each investor would be given the opportunity to notify the company in writing, within a period of no less than 20 business days and no more than 45 business days from the effective date of a post-effective amendment to the company s registration statement, to decide if he, she or it elects to remain a stockholder of the company or require the return of his, her or its investment. If the company has not received the notification by the end of the 45th business day, funds and interest or dividends, if any, held in the trust or escrow account are automatically returned to the stockholder. Unless a sufficient number of investors elect to remain investors, all funds on deposit in the escrow account must be returned to all of the investors and none of the securities are issued. 109 Terms of Our Offering Terms Under a Rule 419 Offering Business combination deadline If we have not completed our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, we will (1) cease all operations except for the purpose of winding up, (2) as promptly as reasonably possible but not more than 10 business days thereafter, redeem 100% of the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (less up to $100,000 of interest to pay dissolution expenses and which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), and (3) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under the laws of the State of Delaware to provide for claims of creditors and the requirements of other applicable law. If an acquisition has not been completed within 18 months after the effective date of the company s registration statement, funds held in the trust or escrow account are returned to investors. Release of funds Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, if any, the funds held in the trust account will not be released from the trust account until the earliest of: (1) our completion of an initial business combination; (2) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering or (B) with respect to any other material provision relating to Class A common stockholders rights or pre-initial business combination activity; and (3) the redemption of our public shares if The proceeds held in the escrow account are not released until the earlier of the completion of a business combination or the failure to effect a business combination within the allotted time. 110 Terms of Our Offering Terms Under a Rule 419 Offering we have not completed an initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, subject to applicable law. Limitation on redemption rights of stockholders holding more than 15% of the shares sold in this offering if we hold a stockholder vote If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a "group" (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect Excess Shares (more than an aggregate of 15% of the shares sold in this offering), without our prior consent. Our public stockholders inability to redeem Excess Shares will reduce their influence over our ability to complete our initial business combination and they could suffer a material loss on their investment in us if they sell Excess Shares in open market transactions. Most blank check companies provide no restrictions on the ability of stockholders to redeem shares based on the number of shares held by such stockholders in connection with an initial business combination. Tendering share certificates in connection with a tender offer or redemption rights We may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in "street name," to either tender their certificates to our transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up to two business days prior to the initially scheduled vote on the proposal to approve our initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically using The Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option. The tender offer or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public stockholders to satisfy such delivery requirements. Accordingly, a public stockholder would have from the time we send out our tender offer materials In order to perfect redemption rights in connection with their business combinations, holders could vote against a proposed business combination and check a box on the proxy card indicating such holders were seeking to exercise their redemption rights. After the business combination was approved, the company would contact such stockholders to arrange for them to deliver their certificate to verify ownership. 111 Terms of Our Offering Terms Under a Rule 419 Offering until the close of the tender offer period, or up to two business days prior to the initially scheduled vote on the business combination if we distribute proxy materials, as applicable, to tender its shares if it wishes to seek to exercise its redemption rights. Competition We expect to encounter intense competition from other entities having a business objective similar to ours, including private investors (which may be individuals or investment partnerships), other blank check companies and other entities, domestic and international, competing for the types of businesses we intend to acquire. Many of these individuals and entities are well established and have extensive experience in identifying and effecting, directly or indirectly, acquisitions of companies operating in or providing services to various industries. Many of these competitors possess greater technical, human and other resources or more local industry knowledge than we do and our financial resources will be relatively limited when contrasted with those of many of these competitors. While we believe there are numerous target businesses we could potentially acquire with the net proceeds of this offering and the sale of the private placement warrants, our ability to compete with respect to the acquisition of certain target businesses that are sizable will be limited by our available financial resources. This inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target businesses. Furthermore, in the event we seek stockholder approval of our initial business combination and we are obligated to pay cash for our shares of Class A common stock, it will potentially reduce the resources available to us for our initial business combination. Any of these obligations may place us at a competitive disadvantage in successfully negotiating a business combination. Conflicts of Interest Our management team, in their capacities as directors, officers or employees of our sponsor or its affiliates or in their other endeavors, may choose to present potential business combinations to the related entities described above, current or future entities affiliated with or managed by our sponsor, or third parties, before they present such opportunities to us, subject to his or her fiduciary duties under the laws of the State of Delaware and any other applicable fiduciary duties. Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company and it is an opportunity that we are able to complete on a reasonable basis. For more information, see the section entitled "Management — Conflicts of Interest." Our directors and officers presently have, and any of them in the future may have, additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity. Accordingly, if any of our directors or officers becomes aware of a business combination opportunity that is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she may need to honor these fiduciary or contractual obligations to present such business combination opportunity to such entity, or in the case of a non-compete restriction, may not present such opportunity to us at all, subject to his or her fiduciary duties under Delaware law. See "Risk Factors — Certain of our directors and officers are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented." We do not believe, however, that the fiduciary duties or contractual obligations of our directors or officers will materially affect our ability to complete our initial business combination. Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party (other than our independent registered public accounting firm) for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (1) $10.20 per public share or (2) such lesser amount per public share held in the trust account as 112 of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third-party claims. We have not independently verified whether our sponsor has sufficient funds to satisfy their indemnity obligations and believe that our sponsor s only assets are securities of our company and, therefore, our sponsor may not be able to satisfy those obligations. We have not asked our sponsor to reserve for such obligations. Facilities We currently maintain our executive offices at 40 Burton Hills Boulevard, Suite 100, Nashville, Tennessee 37215. We consider our current office space adequate for our current operations. Employees We currently have two officers and do not intend to have any full-time employees prior to the completion of our initial business combination. Members of our management team are not obligated to devote any specific number of hours to our matters but they intend to devote as much of their time as they deem necessary to our affairs until we have completed our initial business combination. The amount of time that any such person will devote in any time period will vary based on whether a target business has been selected for our initial business combination and the current stage of the business combination process. Periodic Reporting and Financial Information We will register our units, Class A common stock and warrants under the Exchange Act and have reporting obligations, including the requirement that we file annual, quarterly and current reports with the SEC. In accordance with the requirements of the Exchange Act, our annual reports will contain financial statements audited and reported on by our independent registered public accounting firm. We will provide stockholders with audited financial statements of the prospective target business as part of the tender offer materials or proxy solicitation materials sent to stockholders to assist them in assessing the target business. These financial statements may be required to be prepared in accordance with, or be reconciled to, U.S. GAAP or IFRS, depending on the circumstances and the historical financial statements may be required to be audited in accordance with PCAOB standards. These financial statement requirements may limit the pool of potential target businesses we may acquire because some targets may be unable to provide such financial statements in time for us to disclose such financial statements in accordance with federal proxy rules and complete our initial business combination within the prescribed time frame. While this may limit the pool of potential business combination candidates, we do not believe that this limitation will be material. We will be required to evaluate our internal control procedures for the fiscal year ending December 31, 2023 as required by the Sarbanes-Oxley Act. Only in the event we are deemed to be a large accelerated filer or an accelerated filer, and no longer qualify as an emerging growth company, will we be required to comply with the independent registered public accounting firm attestation requirement on our internal control over financial reporting. A target business may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of their internal controls. The development of the internal controls of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such acquisition. Prior to the effectiveness of the registration statement of which this prospectus forms a part, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. 113 We are an "emerging growth company," as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act provides that an "emerging growth company" can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock held by non-affiliates equaled or exceeded $700 million as of the end of that year s second fiscal quarter, and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to "emerging growth company" will have the meaning associated with it in the JOBS Act. Additionally, we are a "smaller reporting company" as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates equals or exceeds $250 million as of the end of that year s second fiscal quarter, or (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates equaled or exceeded $700 million as of the end of that year s second fiscal quarter. Legal Proceedings There is no material litigation, arbitration or governmental proceeding currently pending against us or any of our officers, directors or sponsor in their capacity as such, and we and our officers, directors and sponsor have not been subject to any such proceeding in the 12 months preceding the date of this prospectus. 114 MANAGEMENT Directors, Director Nominees and Officers Name Age Title Charles Martin 78 Chairman Justin Dearborn 52 Co-Chief Executive Officer and Director Jonathan Phillips 48 Co-Chief Executive Officer and Director Matthew Etheridge 49 Director Nominee Jeremy Friese 46 Director Nominee Kelly Richmond Pope 47 Director Nominee John Glaser 66 Director Nominee Anthony Sanzo 67 Director Nominee Our directors, director nominees and officers are as follows: Our Management Team Charles N. Martin, Chairman Charles Martin, our Chairman, is the founder and Chairman of Martin Ventures, a Nashville-based investment firm he founded in 2009. Mr. Martin has more than 50 years of experience operating large, complex healthcare systems. At Martin Ventures, he leads an investment firm dedicated to building and investing in healthcare technology, healthcare services and healthcare technology-enabled services companies that optimize existing healthcare provider businesses, develop new and innovative models of care, and empower the healthcare consumer. Martin Ventures has a current portfolio of 20 healthcare companies and has successfully exited an additional 13 healthcare investments. Prior to launching Martin Ventures, Mr. Martin founded Vanguard Health Systems and served as Vanguard s Founder, Chairman, and Chief Executive Officer for 16 years. Vanguard went public in 2011, and in 2013 was acquired by Tenet Healthcare for $4.3 billion. Before launching Vanguard, Mr. Martin, in conjunction with private equity partners, acquired the hospital chain Republic Health, ultimately founding a new healthcare system called OrNda Healthcare Corp. OrNda became the nation s third-largest investor-owned hospital chain with 53 hospitals before being sold to Tenet Healthcare Corp. in 1997 for $1.8 billion. Earlier in Mr. Martin s career, he served in numerous executive roles with Hospital Corporation of America, Inc., General Care Corp. and HealthTrust, Inc. Mr. Martin has also served on numerous boards of directors, including the University of Pennsylvania Law School and RAND Health, an independent health research group. Mr. Martin received his B.A. from Southern Adventist University. Mr. Martin is well qualified to serve as our Chairman and on our Board of Directors. He has extensive experience in investing, acquiring and leading public and private companies. He also has comprehensive understanding and insight into trends impacting the evolution of the healthcare industry given his experience in the space. Justin Dearborn, Co-Chief Executive Officer and Director Justin Dearborn, our Co-Chief Executive Officer and a director, has over 25 years of experience leading healthcare, technology and publishing businesses and is currently serving as the Chief Executive Officer of PatientBond, Inc., a digital patient engagement company powered by healthcare consumer psychographics. Before his role as Chief Executive Officer of PatientBond, Mr. Dearborn served as Chief Executive Officer of Tribune Publishing Company (Nasdaq: TPCO), a media company, from 2016 to 2019 and as Chief Executive Officer and Chairman from 2018 to 2019. Mr. Dearborn was chief executive officer of eMed, an at-home diagnostic testing company, in 2020. Mr. Dearborn was Chief Operating Officer for ICM Partners, a leading talent agency, in 2019. Prior to Tribune, he served as Chief Executive Officer and a director of Merge Healthcare Incorporated (Nasdaq: MRGE), a clinical software solution provider from 2008 until 2016. During his tenure, Mr. Dearborn led the company through a period of transformation and sustainable growth. While serving as Chief Executive Officer of Merge, he executed a multi-faceted growth strategy comprised of significant investments in sales and marketing capabilities 115 across Merge s core solution offerings while pursuing acquisitions to broaden market reach into adjacent sectors and to increase capabilities and share of current solution offerings. Mr. Dearborn joined Merge as Chief Executive Officer when Merge s enterprise value was approximately $10 million. Merge was acquired by IBM for $1 billion in 2015 and was integrated into IBM s Watson Health division to deliver intuitive, cognitive computing solutions to healthcare providers. Over his career, Mr. Dearborn has led the acquisition of numerous companies, including the sales of Merge and the LA Times. Before joining Merge, Mr. Dearborn served as managing director at Merrick Ventures, LLC, a private investment firm. In addition to serving on the board of directors of PatientBond, Mr. Dearborn is serving out his final term as a director and Chairman of the Audit Committee of Next Level Health, an Illinois based Medicaid insurance provider that was acquired by Centene Corporation in 2020. Mr. Dearborn received his B.S. in Accounting from Illinois State University and his J.D. from Depaul College of Law. Mr. Dearborn is well qualified to serve has deep experience in digital health, healthcare IT, and digital healthcare marketing and has demonstrated strong leadership results across multiple business sectors and multiple publicly traded entities. Mr. Dearborn also has consummated a large number of acquisitions in the healthcare technology field, demonstrating knowledge of target sourcing, due diligence, transaction structuring and integration. Jonathan R. Phillips, Co-Chief Executive Officer and Director Jonathan Phillips, our Co-Chief Executive Officer and a director, has over 25 years of experience in healthcare information technology, healthcare services, investment banking and private investing. Mr. Phillips has served as Managing Director and Head of Private Equity for FTCP, headquartered in Wheaton, Illinois, since November 2016. Mr. Phillips is also the founder and Managing Partner of First Health Capital Partners, LLC, a healthcare technology and services investment firm founded in January 2016. Mr. Phillips has led investments in a broad range of healthcare technology and services companies, including Vivify Health (acquired by United Health Group in 2019), Lightbeam Health, AVIA, RxAnte, and Wellvana Health. Before his role at First Trust Capital Partners, in 2005, Mr. Phillips founded Healthcare Growth Partners, LLC, a provider of strategic and financial advisory services to healthcare technology companies, and he served as its Managing Director until November 2016. Prior to founding Healthcare Growth Partners, Mr. Phillips was a member of the Healthcare Investment Banking Group at William Blair, an investment banking firm. Prior to William Blair, he served in various roles in the healthcare practice of Deloitte Consulting. Mr. Phillips currently serves as a director and as the Audit Committee chair for Streamline Health (Nasdaq: STRM), a publicly traded healthcare information technology company. In addition, Mr. Phillips serves on the boards of a number of private companies including AVIA, Conversio Health, Cordata Healthcare Innovations, Lightbeam Health, PatientBond, RxAnte, Wellbox and Wellvana. Mr. Phillips has completed over 115 transactions involving healthcare companies and has completed over 40 strategic advisory engagements for healthcare technology and services companies. Mr. Phillips earned his MBA in Finance, Marketing and Health Services Management from the J. L. Kellogg School of Management, Northwestern University, and his BA in Economics and Management from DePauw University. Mr. Phillips is well qualified to serve as co-Chief Executive Officer and as a Director as his experiences within the healthcare sector allow Mr. Phillips to provide our Company and board of directors with valuable insights and analysis as to strategic and financial developments within the industry and potential opportunities and consequences such developments create for us. Mr. Phillips brings specific expertise in identifying promising targets and in transaction structuring and negotiation. Matthew Etheridge, Director Nominee Matthew Etheridge is a private investor with over 20 years of investment management experience, with a primary focus on healthcare services and information technology. He has invested in and served on the board of directors of several public and private companies in these areas, including NaviHealth (acquired by Cardinal Health in 2018) Universal American Corp. (NYSE: UAM; acquired by Wellcare in 2017), Lightbeam Health Solutions, Healthmine and Conversio Health. Previously, Mr. Etheridge was a Managing Partner of Perry Capital LLC, a private investment management firm, where he was Co-Portfolio Manager of the firm s healthcare group, which managed public and private investments in healthcare and other industries. Prior to joining Perry Capital in 2001, Mr. Etheridge was an investment analyst for Stanford Management Company, the investment manager of Stanford University s 116 endowment. Prior to joining Stanford Management in 1997, Mr. Etheridge was a consultant with McKinsey & Company. Mr. Etheridge received his J.D. from Stanford Law School and his A.B. in Economics from Stanford University. Mr. Etheridge is well qualified to serve on our board of directors due to his extensive experience in evaluating and pursuing investments in the healthcare field. Mr. Etheridge also brings deep understanding of population health, medical risk models, government payment programs including Medicare Advantage and managed Medicaid, as well as innovation models like accountable care organizations, bundles, value-based insurance design, and direct contracting. Jeremy Friese, M.D., Director Nominee Jeremy Friese, M.D., is a physician executive with a demonstrated passion for improving healthcare, first as an academic physician leader at Mayo Clinic then as an entrepreneur with various healthcare companies. Dr. Friese currently serves as President, Payer Market at Olive, a developer of process automation software designed to build meaningful artificial intelligence for healthcare payers and providers. Prior to Olive, Dr. Friese ran Invenshure, a healthcare venture incubator, and co-founded and led Verata Health, a venture-backed AI technology company that pioneered Frictionless Prior Authorization for payers and providers, and which was acquired by Olive in 2020. Prior to his transition to entrepreneurship, Dr. Friese was a physician and executive at the Mayo Clinic and Harvard University. During his Mayo career, he held executive leadership positions for the imaging service line, the Mayo Clinic Strategic Investment Fund, and Global Business Development. Additionally, Dr. Friese served on several boards of directors, including the International Monetary Fund and the American Cancer Society. Dr. Friese earned his MD at the Mayo Clinic College of Medicine and Science and his MBA at Harvard Business School. Dr. Friese is well qualified to serve on our board of directors due to his extensive experience and relationships in the healthcare industry and his demonstrated expertise in launching, scaling and exiting healthcare information technology and services companies. Dr. Friese also has deep knowledge of healthcare providers, healthcare payers, and life sciences providers based on his operational and investing experience. Kelly Richmond Pope, Ph.D., Director Nominee Kelly Richmond Pope, Ph.D., is a professor in the School of Accountancy and Management Information Systems at DePaul University. Prior to joining DePaul, she worked in the forensic accounting practice at KPMG, LLP on anti-money laundering engagements, insurance fraud investigations and fraud risk management projects. She was named as one of the 25 most powerful women in accounting by the AICPA and CPA Practice Advisor. She currently serves as director and chair of the Audit Committee for the Greater Chicago Food Depository. She is former director and finance chair for Mercy Hospital & Medical Center, former director of the Illinois CPA Society and former member of the governing council for the AICPA. She received her doctorate in accounting from Virginia Tech and she is a licensed certified public accountant. John Glaser Ph.D., Director Nominee John Glaser, Ph.D., is a former senior vice president of Population Health at Cerner Corporation from 2015 to 2019. Prior to such time, he was Chief Executive Officer of Siemens Heath Services from 2010 to 2015. Prior to Siemens, Dr. Glaser was Chief Information Officer at Partners HealthCare. He was the founding chair of CHIME and the past-president of the Healthcare Information and Management Systems Society. He is the former Chair of the Global Agenda Council on Digital Health, World Economic Forum. He is former Senior Advisor to the Office of the National Coordinator for Health Information Technology. Dr. Glaser serves on the boards of directors of the Scottsdale Institute, Intouch Health, PatientPing, National Committee for Quality Assurance, the American Telemedicine Association, Wellsheet and Relatient. Dr. Glaser has received numerous industry awards, including the John P. Glaser Innovation Award (established by the School of Biomedical Informatics, UTHealth), William B. Stead Thought Leadership Award (American Medical Informatics Association) and the Lifetime Achievement Award (CHIME). He has authored many articles and books on the strategic application of IT in health care. He is on the faculty of the Wharton School at the University of Pennsylvania, the UTHealth School of Biomedical Informatics and the Harvard School of Public Health. 117 Anthony Sanzo, Director Nominee Anthony Sanzo has been a healthcare and healthcare information technology executive for over 20 years and brings a deep understanding of the operational challenges faced by healthcare providers and the ways that technology solutions can be deployed to address them. Mr. Sanzo currently serves as Chairman of the Board of Net Health Systems, a specialized electronic health record software and services vendor providing technology solutions that address the continuum of care from hospital to home. Prior to his role as Chairman, Mr. Sanzo was Chief Executive Officer of Net Health from 2012 until 2019. Over the course of his tenure, Net Health grew from a single product startup to a multi-product, multimarket, healthcare information technology company. Prior to joining Net Health, Mr. Sanzo served as the Chief Executive Officer for TeleTracking Technologies, a company he joined in late 2001. During his tenure, the company evolved from a workflow automation startup focusing on hospital support services to the world market and innovation leader in patient flow automation, capacity management and related operations improvements. With more than 800 clients in three countries, TeleTracking grew to become the largest vendor in its market. Prior to TeleTracking, Mr. Sanzo held executive positions for two major academic medical centers and served as the Chief Executive Officer for Allegheny General Hospital for nearly a decade. Mr. Sanzo has been a board member of multiple companies and is a graduate of Allegheny College and Duke University s Fuqua School of Business. Number, Terms of Office and Appointment of Directors and Officers Upon the effectiveness of the registration statement of which this prospectus forms a part, we expect that our board of directors will consist of eight members. Prior to our initial business combination, holders of our founder shares will have the right to appoint all of our directors and remove members of the board of directors for any reason, and holders of our public shares will not have the right to vote on the appointment of directors during such time. These provisions of our amended and restated certificate of incorporation may only be amended by approval of at least 90% of the shares of our Class B common stock. Each of our directors will hold office for a three-year term. Subject to any other special rights applicable to the stockholders, any vacancies on our board of directors may be filled by the affirmative vote of a majority of the directors present and voting at the meeting of our board of directors or by a majority of the holders of our common stock (or, prior to our initial business combination, holders of our founder shares). Our officers are appointed by the board of directors and serve at the discretion of the board of directors, rather than for specific terms of office. Our board of directors is authorized to appoint persons to the offices set forth in our amended and restated certificate of incorporation as it deems appropriate. Our bylaws provide that our officers may consist of a Chairman, a Chief Executive Officer, a President, a Chief Operating Officer, a Chief Financial Officer, Vice Presidents, a Secretary, Assistant Secretaries, a Treasurer and such other offices as may be determined by the board of directors. Director Independence The NYSE listing standards require that a majority of our board of directors be independent within one year of our initial public offering. An "independent director" is defined generally as a person other than an officer or employee of the company or its subsidiaries or any other individual having a relationship which in the opinion of the company s board of directors, would interfere with the director s exercise of independent judgment in carrying out the responsibilities of a director. Upon the effectiveness of the registration statement of which this prospectus forms a part, we expect to have five "independent directors" as defined in the NYSE listing standards and applicable SEC rules prior to completion of this offering. Our board has determined that each of Matthew Etheridge, Jeremy Friese, Kelly Richmond Pope, Anthony Sanzo and John Glaser is an independent director under applicable SEC rules and the NYSE listing standards. Our independent directors will have regularly scheduled meetings at which only independent directors are present. Officer and Director Compensation None of our directors or officers has received any cash compensation for services rendered to us. Our sponsor, directors and officers, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business combinations. Our audit committee will review on a quarterly basis all payments that were made by us to our sponsor, directors, officers or our or any of their affiliates. Commencing on the date that 118 our securities are first listed on the NYSE through the earlier of consummation of our initial business combination and our liquidation, we will pay affiliates of our sponsor $10,000 per month in aggregate for office space, secretarial and administrative services provided to members of our management team. Our sponsor will transfer to each of our independent directors 40,000 founder shares prior to the consummation of this offering. See "Principal Stockholders." After the completion of our initial business combination, directors or members of our management team who remain with us may be paid consulting, management or other compensation from the combined company. All compensation will be fully disclosed to stockholders, to the extent then known, in the tender offer materials or proxy solicitation materials furnished to our stockholders in connection with a proposed business combination. It is unlikely the amount of such compensation will be known at the time, because the directors of the post-combination business will be responsible for determining executive officer and director compensation. Any compensation to be paid to our officers after the completion of our initial business combination will be determined by a compensation committee constituted solely by independent directors. We are not party to any agreements with our directors and officers that provide for benefits upon termination of employment. The existence or terms of any such employment or consulting arrangements may influence our management s motivation in identifying or selecting a target business, and we do not believe that the ability of our management to remain with us after the consummation of our initial business combination should be a determining factor in our decision to proceed with any potential business combination. Committees of the Board of Directors Pursuant to the rules of the NYSE, we will establish three standing committees — an audit committee in compliance with Section 3(a)(58)(A) of the Exchange Act, a compensation committee and a nominating and corporate governance committee, each comprised of independent directors. Under NYSE Rule 303A.00, a company listing in connection with its initial public offering is permitted to phase in its compliance with the independent committee requirements. We do not intend to rely on the phase-in schedules set forth in NYSE Rule 303A.00. Audit Committee Upon the effectiveness of the registration statement of which this prospectus forms a part, we will establish an audit committee of the board of directors. The members of our audit committee will be Kelly Richmond Pope, Anthony Sanzo, and John Glaser. Kelly Richmond Pope will serve as chairperson of the audit committee. Each member of the audit committee is financially literate and our board of directors has determined that qualifies as an "audit committee financial expert" as defined in applicable SEC rules and has accounting or related financial management expertise. We will adopt an audit committee charter, which will detail the purpose and principal functions of the audit committee, including: assisting board oversight of (1) the integrity of our financial statements, (2) our compliance with legal and regulatory requirements, (3) our independent registered public accounting firm s qualifications and independence, and (4) the performance of our internal audit function and independent registered public accounting firm; the appointment, compensation, retention, replacement, and oversight of the work of the independent registered public accounting firm and any other registered public accounting firm engaged by us; pre-approving all audit and non-audit services to be provided by the independent registered public accounting firm or any other registered public accounting firm engaged by us, and establishing pre-approval policies and procedures; reviewing and discussing with the independent registered public accounting firm all relationships the independent registered public accounting firm has with us in order to evaluate their continued independence; setting clear hiring policies for employees or former employees of the independent registered public accounting firm; 119 setting clear policies for audit partner rotation in compliance with applicable laws and regulations; obtaining and reviewing a report, at least annually, from the independent registered public accounting firm describing (1) the independent registered public accounting firm s internal quality-control procedures and (2) any material issues raised by the most recent internal quality-control review, or peer review, of the audit firm, or by any inquiry or investigation by governmental or professional authorities, within the preceding five years respecting one or more independent audits carried out by the firm and any steps taken to deal with such issues; meeting to review and discuss our annual audited financial statements and quarterly financial statements with management and the independent registered public accounting firm, including reviewing our specific disclosures under "Management s Discussion and Analysis of Financial Condition and Results of Operations;" reviewing and approving any related party transaction required to be disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC prior to us entering into such transaction; and reviewing with management, the independent registered public accounting firm, and our legal advisors, as appropriate, any legal, regulatory or compliance matters, including any correspondence with regulators or government agencies and any employee complaints or published reports that raise material issues regarding our financial statements or accounting policies and any significant changes in accounting standards or rules promulgated by the Financial Accounting Standards Board, the SEC or other regulatory authorities. Compensation Committee Upon the effectiveness of the registration statement of which this prospectus forms a part, we will establish a compensation committee of the board of directors. The members of our compensation committee will be Anthony Sanzo, Kelly Richmond Pope and John Glaser. Anthony Sanzo will serve as chairperson of the compensation committee. We will adopt a compensation committee charter, which will detail the purpose and responsibility of the compensation committee, including: reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officers compensation, evaluating our Chief Executive Officers performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer based on such evaluation; reviewing and making recommendations to our board of directors with respect to the compensation, and any incentive-compensation and equity-based plans that are subject to board approval of all of our other officers; reviewing our executive compensation policies and plans; implementing and administering our incentive compensation equity-based remuneration plans; assisting management in complying with our proxy statement and annual report disclosure requirements; approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our officers and employees; producing a report on executive compensation to be included in our annual proxy statement; and reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors. The charter will also provide that the compensation committee may, in its sole discretion, retain or obtain the advice of a compensation consultant, independent legal counsel or other advisor and will be directly responsible for the appointment, compensation and oversight of the work of any such advisor. However, before engaging or receiving advice from a compensation consultant, external legal counsel or any other advisor, the compensation committee will consider the independence of each such advisor, including the factors required by the NYSE and the SEC. Notwithstanding the foregoing, as indicated above, other than the payment to affiliates of our sponsor of $10,000 per month in aggregate, for office space, and secretarial and administrative support and reimbursement of expenses, 120 no compensation of any kind, including finders, consulting or other similar fees, will be paid to any of our existing stockholders, officers, directors or any of their respective affiliates, prior to, or for any services they render in order to effectuate the consummation of an initial business combination. Nominating and Corporate Governance Committee Upon the effectiveness of the registration statement of which this prospectus forms a part, we will establish a nominating and corporate governance committee of the board of directors. The members of our nominating and corporate governance will be John Glaser, Kelly Richmond Pope and Anthony Sanzo. John Glaser will serve as chairperson of the nominating and corporate governance committee. We will adopt a nominating and corporate governance committee charter, which will detail the purpose and responsibilities of the nominating and corporate governance committee, including: identifying, screening and reviewing individuals qualified to serve as directors, consistent with criteria approved by the board, and recommending to the board candidates for nomination for election at the annual meeting of stockholders or to fill vacancies on the board of directors; developing and recommending to the board of directors and overseeing implementation of our corporate governance guidelines; coordinating and overseeing the annual self-evaluation of the board of directors, its committees, individual directors and management in the governance of the company; and reviewing on a regular basis our overall corporate governance and recommending improvements as and when necessary. The charter will also provide that the nominating and corporate governance committee may, in its sole discretion, retain or obtain the advice of, and terminate, any search firm to be used to identify director candidates, and will be directly responsible for approving the search firm s fees and other retention terms. We have not formally established any specific, minimum qualifications that must be met or skills that are necessary for directors to possess. In general, in identifying and evaluating nominees for director, the board of directors considers educational background, diversity of professional experience, knowledge of our business, integrity, professional reputation, independence, wisdom, and the ability to represent the best interests of our stockholders. Prior to our initial business combination, holders of our public shares will not have the right to recommend director candidates for nomination to our board of directors. Compensation Committee Interlocks and Insider Participation None of our executive officers currently serves, and in the past year has not served, as a member of the compensation committee of any entity that has one or more executive officers serving on our board of directors. Code of Ethics Prior to the closing of this offering, we will adopt a code of ethics and business conduct (our "Code of Ethics") applicable to our directors, officers and employees. We will file a copy of our form of our Code of Ethics as an exhibit to the registration statement. You will be able to review this document by accessing our public filings at the SEC s website at www.sec.gov. In addition, a copy of our Code of Ethics will be provided without charge upon request from us. We intend to disclose any amendments to or waivers of certain provisions of our Code of Ethics in a Current Report on Form 8-K. See "Where You Can Find Additional Information." Corporate Governance Guidelines Prior to the closing of this offering, we will adopt corporate governance guidelines no that will serve as a flexible framework within which our board and its committees operate. These guidelines will cover a number of areas including board membership criteria and director qualifications, director responsibilities, board agenda, roles of the chairperson of the board, chief executive officer and presiding director, meetings of independent directors, committee resolutions and assignments, board member access to management and independent advisors, director 121 communications with third parties, director compensation, director orientation and continuing education, evaluation of senior management and management succession planning. A copy of our corporate governance guidelines will be posted on our website. Conflicts of Interest In general, officers and directors of a corporation incorporated under the laws of the State of Delaware are required to present business opportunities to a corporation if: the corporation could financially undertake the opportunity; the opportunity is within the corporation s line of business; and it would not be fair to our company and its stockholders for the opportunity not to be brought to the attention of the corporation. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to another entity pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such entity. Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation. We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to identify and pursue business combination opportunities or complete our initial business combination. Potential investors should also be aware of the following potential conflicts of interest: None of our directors or officers is required to commit his or her full time to our affairs and, accordingly, may have conflicts of interest in allocating his or her time among various business activities. In the course of their other business activities, our directors and officers may become aware of investment and business opportunities that may be appropriate for presentation to us as well as the other entities with which they are affiliated. Our management may have conflicts of interest in determining to which entity a particular business opportunity should be presented. For a complete description of our management s other affiliations, see "— Directors, Director Nominees and Officers." Our initial stockholders, directors and officers have agreed to waive their redemption rights with respect to any founder shares and public shares held by them in connection with the consummation of our initial business combination. Additionally, our initial stockholders have agreed to waive their redemption rights with respect to their founder shares if we fail to consummate our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) after the closing of this offering. However, if our initial stockholders (or any of our directors, officers or affiliates) acquire public shares, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to consummate our initial business combination within the prescribed time frame. If we do not complete our initial business combination within such applicable time period, the proceeds of the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares, and the private placement warrants will expire worthless. With certain limited exceptions, the founder shares will not be transferable, assignable or salable by our initial stockholders until the earlier of: (1) one year after the completion of our initial business combination; and (2) subsequent to our initial business combination (x) if the last reported sale price of our shares of Class A common stock equals or exceeds $12.00 per share (as adjusted for share splits, share dividends, rights issuances, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination or (y) the date on which we complete a liquidation, merger, share exchange, reorganization or other similar 122 transaction that results in all of our public stockholders having the right to exchange their common stock for cash, securities or other property. With certain limited exceptions, the private placement warrants and the common stock underlying such warrants, will not be transferable, assignable or salable by our sponsor until 30 days after the completion of our initial business combination. Since our sponsor, directors and officers may directly or indirectly own common stock and warrants following this offering, our directors and officers may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Our directors and officers may negotiate employment or consulting agreements with a target business in connection with a particular business combination. These agreements may provide for them to receive compensation following our initial business combination and as a result, may cause them to have conflicts of interest in determining whether to proceed with a particular business combination. Our directors and officers may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such directors and officers was included by a target business as a condition to any agreement with respect to our initial business combination. The conflicts described above may not be resolved in our favor. Accordingly, as a result of multiple business affiliations, our directors and officers have similar legal obligations relating to presenting business opportunities meeting the above-listed criteria to multiple entities. Below is a table summarizing the entities to which our directors, officers and director nominees currently have fiduciary duties or contractual obligations: Individual Entity Entity s Business Affiliation Charles Martin Martin Ventures Investment Firm Chairman Justin Dearborn PatientBond, Inc. Digital Patient Engagement Company Chief Executive Officer Next Level Health Medicaid Insurance Provider Director Jonathan Phillips FTCP Investment Firm Managing Director and Head of Private Equity First Health Capital Partners, LLC Healthcare Technology and Services Investment Firm Founder and Managing Partner Jeremy Friese Olive Process Automation Software Developer President, Payer Market Kelly Richmond Pope DePaul University Higher Education Professor John Glaser Scottsdale Institute Not-for-profit Healthcare Membership Organization Director Intouch Health Telehealth Platform Director PatientPing Patient Healthcare Collaboration Platform Director National Committee for Quality Assurance Non-profit Healthcare Organization Director American Telemedicine Association Non-profit Healthcare Organization Director Wellsheet Healthcare Cloud Platform Director Relatient Healthcare Patient Engagement Platform Director Anthony Sanzo Net Health Systems Electronic Health Record Software and Services Vendor Chairman Accordingly, if any of the above directors or officers become aware of a business combination opportunity which is suitable for any of the above entities to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such entity, and only present it to us if such entity rejects the opportunity, subject to his or her fiduciary duties 123 under Delaware law. Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company and it is an opportunity that we are able to complete on a reasonable basis. We do not believe, however, that any of the foregoing fiduciary duties or contractual obligations will materially affect our ability to identify and pursue business combination opportunities or complete our initial business combination. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, directors or officers. In the event we seek to complete our initial business combination with such a company, we, or a committee of independent and disinterested directors, would obtain an opinion from an independent investment banking firm that is a member of FINRA or from an independent accounting firm that such an initial business combination is fair to our company from a financial point of view. Furthermore, in no event will our sponsor or any of our existing officers or directors, or any of their respective affiliates, be paid by the company any finder s fee, consulting fee or other compensation prior to, or for any services they render in order to effectuate, the completion of our initial business combination; provided that commencing on the date our securities are first listed on the NYSE, we will pay affiliates of our sponsor $10,000 per month in aggregate for office space, secretarial and administrative services provided to members of our management team. In addition, our sponsor or any of its affiliates may make additional investments in the company in connection with the initial business combination, although our sponsor and its affiliates have no obligation or current intention to do so. If our sponsor or any of its affiliates elects to make additional investments, such proposed investments could influence our sponsor s motivation to complete an initial business combination. In the event that we submit our initial business combination to our public stockholders for a vote, our initial stockholders, directors and officers have agreed, pursuant to the terms of a letter agreement entered into with us, to vote any founder shares (and their permitted transferees will agree) and public shares held by them in favor of our initial business combination. Limitation on Liability and Indemnification of Directors and Officers Our amended and restated certificate of incorporation will provide that our officers and directors will be indemnified by us to the fullest extent authorized by Delaware law, as it now exists or may in the future be amended. In addition, our amended and restated certificate of incorporation will provide that our directors will not be personally liable for monetary damages to us or our stockholders for breaches of their fiduciary duty as directors, unless they violated their duty of loyalty to us or our stockholders, acted in bad faith, knowingly or intentionally violated the law, authorized unlawful payments of dividends, unlawful stock purchases or unlawful redemptions, or derived an improper personal benefit from their actions as directors. We will enter into agreements with our officers and directors to provide contractual indemnification in addition to the indemnification provided for in our amended and restated certificate of incorporation. Our bylaws also will permit us to secure insurance on behalf of any officer, director or employee for any liability arising out of his or her actions, regardless of whether Delaware law would permit such indemnification. We will purchase a policy of directors and officers liability insurance that insures our officers and directors against the cost of defense, settlement or payment of a judgment in some circumstances and insures us against our obligations to indemnify our officers and directors. Except with respect to any public shares they may acquire in this offering or thereafter (in the event we do not consummate an initial business combination), our officers and directors have agreed to waive (and any other persons who may become an officer or director prior to the initial business combination will also be required to waive) any right, title, interest or claim of any kind in or to any monies in the trust account, and not to seek recourse against the trust account for any reason whatsoever, including with respect to such indemnification. These provisions may discourage stockholders from bringing a lawsuit against our directors for breach of their fiduciary duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against officers and directors, even though such an action, if successful, might otherwise benefit us and our stockholders. Furthermore, a stockholder s investment may be adversely affected to the extent we pay the costs of settlement and damage awards against officers and directors pursuant to these indemnification provisions. We believe that these provisions, the directors and officers liability insurance and the indemnity agreements are necessary to attract and retain talented and experienced officers and directors. 124 PRINCIPAL STOCKHOLDERS The following table sets forth information regarding the beneficial ownership of our common stock as of the date of this prospectus, and as adjusted to reflect the sale of our shares of Class A common stock included in the units offered by this prospectus, and assuming no purchase of units in this offering, by: each person known by us to be the beneficial owner of more than 5% of our issued and outstanding common stock; each of our directors, officers and director nominees that beneficially owns common stock; and all our directors, officers and director nominees as a group. Unless otherwise indicated, we believe that all persons named in the table have sole voting and investment power with respect to all common stock beneficially owned by them. The following table does not reflect record or beneficial ownership of the private placement warrants as these warrants are not exercisable within 60 days of the date of this prospectus. The post-offering ownership percentage column below assumes that the underwriters do not exercise their over-allotment option, that 656,250 founder shares are forfeited, and that there are 21,875,000 common stock issued and outstanding after this offering. Name and Address of Beneficial Owner(1) Number of Shares Beneficially Owned(2) Approximate Percentage of Issued and Outstanding Common Stock Shares Before Offering After Offering(2) First Digital Health, LLC (our sponsor)(3) 4,831,250 96.0 % 19.1 % Charles Martin(4) — — — Justin Dearborn(3) 4,831,250 96.0 % 19.1 % Jonathan Phillips(3) 4,831,250 96.0 % 19.1 % Matthew Etheridge(4) 40,000 * * Jeremy Friese(4) 40,000 * * Kelly Richmond Pope(4) 40,000 * * John Glaser(4) 40,000 * * Anthony Sanzo(4) 40,000 * * All directors, officers and director nominees as a group (8 individuals) 5,031,250 100 % 20.0 % ____________ * Less than one percent. (1) Unless otherwise noted, the business address of each of the following entities or individuals is c/o First Digital Health Acquisition Corp., 40 Burton Hills Boulevard, Suite 100, Nashville, Tennessee 37215. (2) Interests shown consist solely of founder shares, classified as Class B common stock. Such common stock will convert into shares of Class A common stock on a one-for-one basis, subject to adjustment, as described in the section entitled "Description of Securities." (3) First Digital Health, LLC, our sponsor, is the record holder of the Class B common stock reported herein. Our sponsor is managed by Jonathan Phillips and Justin Dearborn as Managers, in each case acting by unanimous consent. Each of Jonathan Phillips and Justin Dearborn may be deemed to beneficially own the shares of Class B common stock held by our sponsor. Each of Jonathan Phillips and Justin Dearborn disclaims beneficial ownership of the reported shares of Class B Common stock except to the extent of their respective pecuniary interests therein. (4) Excludes any shares of Class B common stock in which such person has an indirect interest through our sponsor and as to which such person does not have any voting or dispositive power. Immediately after this offering, our initial stockholders will beneficially own 20.0% of the then issued and outstanding common stock (assuming our initial stockholders do not purchase any units in this offering) and will have the right to elect all of our directors prior to our initial business combination as a result of holding all of the founder shares. Holders of our public shares will not have the right to appoint any directors to our board of directors prior to our initial business combination. In addition, because of their ownership block, our initial stockholders may be able to effectively influence the outcome of all other matters requiring approval by our stockholders, including 125 amendments to our amended and restated certificate of incorporation and approval of significant corporate transactions. If we increase or decrease the size of this offering, we will effect a capitalization or share repurchase or redemption or other appropriate mechanism, as applicable, with respect to our founder shares immediately prior to the consummation of this offering in such amount as to maintain the number of founder shares at 20% of our issued and common stock upon the consummation of this offering. Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 9,700,000 (or 10,750,000 if the underwriters over-allotment option is exercised in full) private placement warrants at a price of $1.00 per warrant ($9,700,000 in the aggregate or $10,750,000 in the aggregate if the underwriters over-allotment option is exercised in full) in a private placement that will occur simultaneously with the closing of this offering. Each private placement warrant entitles the holder to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment as provided herein. If we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, the proceeds of the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares, and the private placement warrants will expire worthless. The private placement warrants are identical to the warrants sold as part of the units in this offering except that, so long as they are held by our sponsor or its permitted transferees: (1) they will not be redeemable by us (except as described below under "Description of Securities — Redeemable Warrants — Public Redeemable Warrants — Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00"); (2) they (including the shares of Class A common stock issuable upon exercise of these warrants) may not, subject to certain limited exceptions, be transferred, assigned or sold by our sponsor until 30 days after the completion of our initial business combination, as described below; (3) they may be exercised by the holders on a cashless basis; and (4) they (including the common stock issuable upon exercise of these warrants) are entitled to registration rights, as described below. Our sponsor and our directors and officers are deemed to be our "promoters" as such term is defined under the federal securities laws. See "Certain Relationships and Related Party Transactions" for additional information regarding our relationships with our promoters. Transfers of Founder Shares and Private Placement Warrants The founder shares, private placement warrants and any shares of Class A common stock issued upon conversion or exercise thereof are each subject to transfer restrictions pursuant to lock-up provisions in the letter agreement with us to be entered into by our initial stockholders, directors and officers. Those lock-up provisions provide that such securities are not transferable or salable (1) in the case of the founder shares, until the earlier of: (A) one year after the completion of our initial business combination; and (B) subsequent to our initial business combination (x) if the last reported sale price of our shares of Class A common stock equals or exceeds $12.00 per share (as adjusted for share splits, share dividends, rights issuances, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination or (y) the date on which we complete a liquidation, merger, share exchange, reorganization or other similar transaction that results in all of our public stockholders having the right to exchange their common stock for cash, securities or other property, and (2) in the case of the private placement warrants and the respective shares of Class A common stock underlying such warrants, until 30 days after the completion of our initial business combination, except in each case (a) to our directors or officers, any affiliates or family members of any of our directors or officers, the sponsor, any affiliate of the sponsor, any members or partners of our sponsor or any of their affiliates, (b) in the case of an individual, by gift to a member of the individual s immediate family or to a trust, the beneficiary of which is a member of the individual s immediate family or an affiliate of such person, or to a charitable organization; (c) in the case of an individual, by virtue of laws of descent and distribution upon death of the individual; (d) in the case of an individual, pursuant to a qualified domestic relations order; (e) by private sales or transfers made in connection with the consummation of a business combination at prices no greater than the price at which the securities were originally purchased; (f) in the event of our liquidation prior to our completion of our initial business combination; (g) by virtue of the laws of the State of Delaware or our Sponsor s limited liability company agreement upon dissolution of our Sponsor; or (h) in the event of our completion of a liquidation, merger, share exchange, reorganization or other similar transaction which results in all of our stockholders having the right to exchange their shares of Class A common stock for cash, securities or other property subsequent to our completion of our initial business combination; provided, however, that in the case of clauses (a) through (e) or (g) these permitted transferees must enter into a written agreement agreeing to be bound by these transfer restrictions. 126 Registration Rights Our directors and officers and any other holders of the founder shares, private placement warrants and any warrants that may be issued on conversion of working capital loans or extension loans (and any shares of Class A common stock issuable upon the exercise of the private placement warrants or warrants issued upon conversion of the working capital loans or extension loans and upon conversion of the founder shares) will be entitled to registration rights pursuant to a registration rights agreement to be signed prior to or on the effective date of this offering requiring us to register such securities for resale (in the case of the founder shares, only after conversion to our shares of Class A common stock). The holders of these securities will be entitled to make up to three demands, excluding short form registration demands, that we register such securities. In addition, the holders have certain "piggy-back" registration rights with respect to registration statements filed subsequent to our completion of our initial business combination and rights to require us to register for resale such securities pursuant to Rule 415 under the Securities Act. However, the registration rights agreement provides that we will not be required to effect or permit any registration or cause any registration statement to become effective until termination of the applicable lock-up period as described under "Principal Stockholders — Transfers of Founder Shares and Private Placement Warrants." We will bear the expenses incurred in connection with the filing of any such registration statements. 127 CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS On May 12, 2021, our sponsor paid $25,000 to cover certain of our offering and formation costs in exchange for an aggregate of 5,750,000 shares of Class B common stock, par value $0.0001 per share. On November 30, 2021, our sponsor surrendered 718,750 founder shares for no consideration, resulting in our sponsor holding 5,031,250 shares of Class B common stock, representing an effective purchase price of approximately $0.005 per share. Our sponsor also transferred an aggregate of 200,000 founder shares to our outside directors, resulting in our sponsor holding 4,831,250 founder shares. Our initial stockholders will collectively own 20% of our issued and outstanding shares after this offering (assuming they do not purchase any units in this offering). If we increase or decrease the size of this offering, we will effect a capitalization or share repurchase or redemption or other appropriate mechanism, as applicable, with respect to our founder shares immediately prior to the consummation of this offering in such amount as to maintain the number of founder shares at 20% of our issued and common stock upon the consummation of this offering. Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 9,700,000 (or 10,750,000 if the underwriters over-allotment option is exercised in full) private placement warrants for a purchase price of $1.00 per warrant ($9,700,000 in the aggregate or $10,750,000 in the aggregate if the underwriters over-allotment option is exercised in full) in a private placement that will occur simultaneously with the closing of this offering. Each private placement warrant may be exercised for one share of Class A common stock at a price of $11.50 per share, subject to adjustment as provided herein. The private placement warrants (including the shares of Class A common stock issuable upon exercise of the private placement warrants) may not, subject to certain limited exceptions, be transferred, assigned or sold by it until 30 days after the completion of our initial business combination. As more fully discussed in "Management — Conflicts of Interest," if any of our directors or officers becomes aware of a business combination opportunity that falls within the line of business of any entity to which he or she has then-current fiduciary or contractual obligations, he or she may be required to present such business combination opportunity to such entity prior to presenting such business combination opportunity to us. Our directors and officers currently have certain relevant fiduciary duties or contractual obligations that may take priority over their duties to us. Our sponsor, directors and officers, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business combinations. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, directors, officers or our or any of their affiliates and will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling on the reimbursement of out-of-pocket expenses incurred by such persons in connection with activities on our behalf. Our sponsor has agreed to loan us up to $350,000 under an unsecured promissory note to be used for a portion of the expenses of this offering. These loans are non-interest bearing, unsecured and are due at the earlier of March 31, 2022 and the closing of this offering. These loans will be repaid upon completion of this offering out of the $750,000 of offering proceeds that has been allocated for the payment of offering expenses (other than underwriting commissions) not held in the trust account. The value of our sponsor s interest in this loan transaction corresponds to the principal amount outstanding under any such loan. As of September 30, 2021, there was $100,000 outstanding under such promissory note. We currently utilize office space at 40 Burton Hills Boulevard, Suite 100, Nashville, Tennessee 37215 from an affiliate of our sponsor. Subsequent to the closing of this offering, we will pay an affiliate of our sponsor $10,000 per month for office space, secretarial and administrative services provided to members of our management team. Upon completion of our initial business combination or our liquidation, we will cease paying these monthly fees. In addition, in order to finance transaction costs in connection with an intended initial business combination, our sponsor or an affiliate of our sponsor or certain of our directors and officers may, but are not obligated to, loan us funds as may be required. If we complete our initial business combination, we may repay such loaned amounts out of the proceeds of the trust account released to us. Otherwise, such loans may be repaid only out of funds held outside the trust account. In the event that our initial business combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust account would be used to repay such loaned amounts. Up to $1,500,000 of such loans may be convertible into warrants at 128 a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants issued to our sponsor. The terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. We do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver of any and all rights to seek access to funds in our trust account. After our initial business combination, members of our management team who remain with us may be paid consulting, management or other fees from the combined company with any and all amounts being fully disclosed to our stockholders, to the extent then known, in the tender offer or proxy solicitation materials, as applicable, furnished to our stockholders. It is unlikely the amount of such compensation will be known at the time of distribution of such tender offer materials or at the time of an annual meeting held to consider our initial business combination, as applicable, as it will be up to the directors of the post-combination business to determine executive officer and director compensation. We have entered into a registration rights agreement with respect to the founder shares, private placement warrants, warrants issued upon conversion of working capital loans or extension loans (if any) and other securities held by our directors and officers (if any), which is described under the heading "Principal Stockholders — Registration Rights." We have entered into a letter agreement with our initial stockholders, officers and directors pursuant to which (i) they have agreed to waive: (a) their redemption rights with respect to any founder shares and public shares held by them, as applicable, in connection with the completion of our initial business combination; (b) their redemption rights with respect to any founder shares and public shares held by them in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation (1) to modify the substance or timing of our obligation to allow redemptions in connection with our initial business combination or to redeem 100% of our public shares if we have not consummated our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, or (2) with respect to any other material provision relating to Class A common stockholders rights or pre-initial business combination activity; and (c) their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame), and the founder shares are subject to certain transfer restrictions, as described under "Description of Securities — Founder Shares." We have agreed that we will not enter into a definitive agreement regarding a proposed business combination without the prior consent of our sponsor. Related Party Policy We have not yet adopted a formal policy for the review, approval or ratification of related party transactions. Accordingly, the transactions discussed above were not reviewed, approved or ratified in accordance with any such policy. Prior to the closing of this offering, we will adopt our Code of Ethics requiring us to avoid, wherever possible, all conflicts of interests, except under guidelines or resolutions approved by our board of directors (or the appropriate committee of our board of directors) or as disclosed in our public filings with the SEC. Under our Code of Ethics, conflict of interest situations will include any financial transaction, arrangement or relationship (including any indebtedness or guarantee of indebtedness) involving the company. In addition, our audit committee, pursuant to a written charter that we will adopt prior to the consummation of this offering, will be responsible for reviewing and approving related party transactions to the extent that we enter into such transactions. An affirmative vote of a majority of the members of the audit committee present at a meeting at which a quorum is present will be required in order to approve a related party transaction. A majority of the members of the entire audit committee will constitute a quorum. Without a meeting, the unanimous written consent of all of the members of the audit committee will be required to approve a related party transaction. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, directors or officers, or our or any of their affiliates. 129 These procedures are intended to determine whether any such related party transaction impairs the independence of a director or presents a conflict of interest on the part of a director, employee or officer. To further minimize conflicts of interest, we have agreed not to consummate an initial business combination with an entity that is affiliated with any of our sponsor, directors or officers unless we, or a committee of independent and disinterested directors, have obtained an opinion from an independent investment banking firm which is a member of FINRA or an independent accounting firm that our initial business combination is fair to our company from a financial point of view. Furthermore, there will be no finder s fees, reimbursements or cash payments made by us to our sponsor, directors or officers, or our or any of their affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination, other than the following payments, none of which will be made from the proceeds of this offering and the sale of the private placement warrants held in the trust account prior to the completion of our initial business combination: Repayment of an aggregate of up to $350,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; Payment to an affiliate of our sponsor of $10,000 per month for office space, secretarial and administrative services provided to members of our management team; Reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; Repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our directors and officers to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into warrants, at a price of $1.00 per warrant at the option of the lender; and repayment of loans in an amount per Paid Extension up to $1,750,000, or $2,012,500 if the underwriters over-allotment option is exercised in full, if we extend the period of time to consummate a business combination as described in this prospectus. The above payments may be funded using the net proceeds of this offering and the sale of the private placement warrants not held in the trust account or, upon completion of the initial business combination, from any amounts remaining from the proceeds of the trust account released to us in connection therewith. 130 DESCRIPTION OF SECURITIES Pursuant to our amended and restated certificate of incorporation, our authorized capital stock consists of 280,000,000 shares of Class A common stock, $0.0001 par value, 20,000,000 shares of Class B common stock, $0.0001 par value, and 1,000,000 shares of undesignated preferred stock, $0.0001 par value. The following description summarizes the material terms of our capital stock. Because it is only a summary, it may not contain all the information that is important to you. Units Each unit has an offering price of $10.00 and consists of one share of Class A common stock and one-half of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as described in this prospectus. Only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We expect the Class A common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless William Blair informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the shares of Class A common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of Class A common stock and warrants. In no event will the Class A common stock and warrants be traded separately until we have filed a Current Report on Form 8-K with the SEC, which includes an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file a Current Report on Form 8-K which includes this audited balance sheet upon the completion of this offering, which closing is anticipated to take place three business days after the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. Common Stock Upon the closing of this offering, 21,875,000 shares of our common stock will be outstanding (assuming no exercise of the underwriters over-allotment option and the corresponding forfeiture of 656,250 founder shares by our sponsor), consisting of: 17,500,000 shares of our Class A common stock underlying the units being offered in this offering; and 4,375,000 shares of Class B common stock held by our initial stockholders. If we increase or decrease the size of the offering we will effect a stock dividend or a share contribution back to capital or other appropriate mechanism, as applicable, with respect to our Class B common stock immediately prior to the consummation of this offering in such amount as to maintain the ownership of our initial stockholders at 20% of the issued and outstanding shares of our common stock upon the consummation of this offering. Common stockholders of record are entitled to one vote for each share held on all matters to be voted on by stockholders. Holders of record of the Class A common stock and holders of record of the Class B common stock will vote together as a single class on all matters submitted to a vote of our stockholders, with each share of common stock entitling the holder to one vote except as required by law. Unless specified in our amended and restated certificate of incorporation or bylaws, or as required by applicable provisions of the DGCL or applicable stock exchange rules, the affirmative vote of a majority of our shares of common stock that are voted is required to approve any such matter voted on by our stockholders. Our board of directors will be divided into three classes, each of which will generally serve for a term of three years with only one class of directors being elected in each year. There is no cumulative voting with respect to the election of directors, with the result that the holders of more than 50% of the shares voted for the election of directors can elect all of the directors. Our stockholders are entitled to receive ratable dividends when, as and if declared by the board of directors out of funds legally available therefor. Notwithstanding the foregoing, prior to the closing of our initial business combination, the holders of Class B common stock, voting together as a single class, shall have the exclusive right to elect and remove any director, and the holders of Class A common stock shall have no right to vote on the election or removal of any director. 131 Because our amended and restated certificate of incorporation will authorize the issuance of up to 280,000,000 shares of Class A common stock, if we were to enter into an initial business combination, we may (depending on the terms of such an initial business combination) be required to increase the number of shares of Class A common stock which we are authorized to issue at the same time as our stockholders vote on the initial business combination to the extent we seek stockholder approval in connection with our initial business combination. In accordance with the NYSE s corporate governance requirements, we are not required to hold an annual meeting until no later than one year after our first fiscal year end following our listing on the NYSE. Under Section 211(b) of the DGCL, we are, however, required to hold an annual meeting of stockholders for the purposes of electing directors in accordance with our bylaws, unless such election is made by written consent in lieu of such a meeting. We may not hold an annual meeting of stockholders to elect new directors prior to the consummation of our initial business combination, and thus we may not be in compliance with Section 211(b) of the DGCL, which requires an annual meeting. Therefore, if our stockholders want us to hold an annual meeting prior to the consummation of our initial business combination, they may attempt to force us to hold one by submitting an application to the Delaware Court of Chancery in accordance with Section 211(c) of the DGCL. We will provide our stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be approximately $10.20 per public share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by deferred underwriting commissions we will pay to the underwriters. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and any public shares held by them in connection with the completion of our initial business combination. We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a stockholder meeting called to approve the initial business combination or (ii) without a stockholder vote by means of a tender offer. If we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the Company representing a majority of the voting power of all outstanding shares of capital stock of the Company entitled to vote at such meeting. If we conduct redemptions by means of a tender offer, the tender offer documents will contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under the SEC s proxy rules. If we seek stockholder approval, the participation of our sponsor, officers, directors, advisors or any of their affiliates in privately negotiated transactions (as described in this prospectus), if any, could result in the approval of our initial business combination even if a majority of our public stockholders vote, or indicate their intention to vote, against such business combination. For purposes of seeking approval of the majority of our outstanding shares of common stock voted, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. We intend to give approximately 30 days (but not less than 10 days nor more than 60 days ) prior written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination. These quorum and voting thresholds, and the voting agreements of our initial stockholders, may make it more likely that we will consummate our initial business combination. If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a "group" (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares of common stock sold in this offering, which we refer to as the Excess Shares. However, we would not be restricting our stockholders ability to vote all of their shares (including Excess Shares) for or against our initial business combination. Our stockholders inability to redeem the Excess Shares will reduce their influence over our ability to complete our initial business combination, and such stockholders could suffer a material loss in their investment if they sell such Excess Shares on the open market. Additionally, such stockholders will not receive 132 redemption distributions with respect to the Excess Shares if we complete the initial business combination. And, as a result, such stockholders will continue to hold that number of shares exceeding 15% and, in order to dispose such shares would be required to sell their stock in open market transactions, potentially at a loss. If we seek stockholder approval in connection with our initial business combination, pursuant to a letter agreement, our sponsor, officers and directors have agreed to vote their founder shares and any public shares purchased during or after this offering (including in open market and privately-negotiated transactions) in favor of our initial business combination. As a result, in addition to our initial stockholders founder shares, we would need 6,562,501, or 37.50% (assuming all issued and outstanding shares are voted and the over-allotment option is not exercised), or 1,093,751, or 6.25% (assuming only the minimum number of shares representing a quorum are voted and the over-allotment option is not exercised), of the 17,500,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have such initial business combination approved (the number of public shares set forth above that would need to be voted in favor of an initial business combination would be reduced to the extent of any public shares held by our initial stockholders, directors and officers). Additionally, each public stockholder may elect to redeem its public shares irrespective of whether they vote for or against the proposed transaction or whether they were a stockholder on the record date for the stockholder meeting held to approve the proposed transaction (subject to the limitation described in the preceding paragraph). Pursuant to our amended and restated certificate of incorporation, if we are unable to complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but no more than 10 business days thereafter subject to lawfully available funds therefor, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their rights to liquidating distributions from the trust account with respect to any founder shares held by them if we fail to complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering. However, if our initial stockholders acquire public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the prescribed time period. In the event of a liquidation, dissolution or winding up of the Company after an initial business combination, our stockholders are entitled to share ratably in all assets remaining available for distribution to them after payment of liabilities and after provision is made for each class of stock, if any, having preference over the common stock. Our stockholders have no preemptive or other subscription rights. There are no sinking fund provisions applicable to the common stock, except that we will provide our stockholders with the opportunity to redeem their public shares for cash equal to their pro rata share of the aggregate amount then on deposit in the trust account, including interest (which will be net of taxes paid by us) upon the completion of our initial business combination, subject to the limitations described herein. Founder Shares The founder shares are identical to the shares of Class A common stock included in the units being sold in this offering, and holders of founder shares have the same stockholder rights as public stockholders, except that (i) the founder shares are subject to certain transfer restrictions, as described in more detail below, (ii) our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed (A) to waive their redemption rights with respect to any founder shares and any public shares held by them in connection with the completion of our initial business combination, (B) to waive their redemption rights with respect to their founder shares and public shares in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation to (i) modify the substance or timing of our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months, if we 133 extend the period of time to complete our initial business combination, as described herein) from the closing of this offering or (ii) with respect to any other material provisions relating to Class A common stockholders rights or pre-initial business combination activity, and (C) to waive their rights to liquidating distributions from the trust account with respect to any founder shares held by them if we fail to complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within such time period, (iii) the founder shares are shares of our Class B common stock that will automatically convert into shares of our Class A common stock at the time of our initial business combination on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights as described herein and (iv) are entitled to registration rights. If we submit our initial business combination to our public stockholders for a vote, our sponsor, officers and directors have agreed (and their permitted transferees will agree) pursuant to the letter agreement to vote any founder shares held by them and any public shares purchased during or after this offering (including in open market and privately-negotiated transactions) in favor of our initial business combination. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts issued in this offering and related to the closing of our initial business combination, the ratio at which the shares of Class B common stock will convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the issued and outstanding shares of Class B common stock agree to waive such anti-dilution adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of all common stock issued and outstanding upon the completion of our initial business combination plus, without duplication, all Class A common stock and equity-linked securities issued or deemed issued in connection with or in relation to the consummation of our initial business combination, excluding any shares of Class A common stock or equity-linked securities exercisable for or convertible into shares of Class A common stock issued, or to be issued, to any seller in the initial business combination and any warrants issued in a private placement to our sponsor or an affiliate of our sponsor upon conversion of working capital loans or extension loans. In no event will any founder shares convert into shares of Class A common stock at a ratio that is less than one-for-one. We cannot determine at this time whether a majority of the holders of our Class B common stock at the time of any future issuance would agree to waive such adjustment to the conversion ratio. They may waive such adjustment due to (but not limited to) the following: (i) closing conditions that are part of the agreement for our initial business combination; (ii) negotiation with Class A stockholders on structuring an initial business combination; or (iii) negotiation with parties providing financing that would trigger the anti-dilution provisions of the Class B common stock. If such adjustment is not waived, the issuance would not reduce the percentage ownership of holders of our Class B common stock, but would reduce the percentage ownership of holders of our Class A common stock. If such adjustment is waived, the issuance would reduce the percentage ownership of holders of both classes of our common stock. The term "equity-linked securities" refers to any debt or equity securities that are convertible, exercisable or exchangeable for shares of Class A common stock issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt. Securities could be "deemed issued" for purposes of the conversion rate adjustment if such shares are issuable upon the conversion or exercise of convertible securities, warrants or similar securities. With certain limited exceptions, the founder shares are not transferable, assignable or salable (except to our officers and directors and other persons or entities affiliated with our sponsor, each of whom will be subject to the same transfer restrictions) until the earlier of (A) one year after the completion of our initial business combination or (B) subsequent to our initial business combination, (x) if the reported closing price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination or (y) the date, following the completion of our initial business combination, on which we complete a liquidation, merger, capital stock exchange, reorganization or other similar transaction that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property. Prior to the closing of our initial business combination, the holders of Class B common stock, voting together as a single class, shall have the exclusive right to elect and remove any director, and the holders of Class A common stock shall have no right to vote on the election or removal of any director. These provisions may only be amended by approval of holders of at least ninety percent (90%) of the Class B common stock. With respect to any other matter submitted to a vote of our shareholders, including any vote in connection with our initial business combination, except as required by law, holders of our founder shares and holders of our public shares will vote together as a single class, with each share entitling the holder to one vote. 134 Preferred Stock Our amended and restated certificate of incorporation will provide that shares of preferred stock may be issued from time to time in one or more series. Our board of directors will be authorized to fix the voting rights, if any, designations, powers, preferences, the relative, participating, optional or other special rights and any qualifications, limitations and restrictions thereof, applicable to the shares of each series. Our board of directors will be able to, without stockholder approval, issue preferred stock with voting and other rights that could adversely affect the voting power and other rights of the holders of the common stock and could have anti-takeover effects. The ability of our board of directors to issue preferred stock without stockholder approval could have the effect of delaying, deferring or preventing a change of control of us or the removal of existing management. We have no preferred stock outstanding at the date hereof. Although we do not currently intend to issue any shares of preferred stock, we cannot assure you that we will not do so in the future. No shares of preferred stock are being issued or registered in this offering. Redeemable Warrants Public Stockholders Warrants Each whole warrant entitles the registered holder to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as discussed below, at any time commencing on the later of 12 months from the closing of this offering or 30 days after the completion of our initial business combination. Pursuant to the warrant agreement, a warrant holder may exercise its warrants only for a whole number of Class A common stock. This means only a whole warrant may be exercised at a given time by a warrant holder. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. The warrants will expire five years after the completion of our initial business combination, at 5:00 p.m., New York City time, or earlier upon redemption or liquidation. We will not be obligated to deliver any shares of Class A common stock pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act with respect to the shares of Class A common stock underlying the warrants is then effective and a current prospectus relating thereto is current, subject to our satisfying our obligations described below with respect to registration. No warrant will be exercisable and we will not be obligated to issue shares of Class A common stock upon exercise of a warrant unless Class A common stock issuable upon such warrant exercise has been registered, qualified or deemed to be exempt under the securities laws of the state of residence of the registered holder of the warrants. In the event that the conditions in the two immediately preceding sentences are not satisfied with respect to a warrant, the holder of such warrant will not be entitled to exercise such warrant and such warrant may have no value and expire worthless. In no event will we be required to net cash settle any warrant. In the event that a registration statement is not effective for the exercised warrants, the purchaser of a unit containing such warrant, if not cash settled, will have paid the full purchase price for the unit solely for the share of Class A common stock underlying such unit. We are not registering the shares of Class A common stock issuable upon exercise of the warrants under the Securities Act or any state securities laws at this time. However, under the terms of the warrant agreement, we have agreed that as soon as practicable, but in no event later than 15 business days after the closing of our initial business combination, we will use our commercially reasonable efforts to file with the SEC a registration statement covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants, and we will use our commercially reasonable efforts to cause the same to become effective within 60 business days after the closing of our initial business combination and to maintain the effectiveness of such registration statement and a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed; provided that if our shares of Class A common stock are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a "covered security" under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a "cashless basis" in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement. If a registration statement covering the shares of Class A common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement, exercise warrants on a "cashless basis" pursuant to the exemption provided by Section 3(a)(9) of the Securities Act; provided that such exemption is available. If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a cashless basis. 135 Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00. Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the private placement warrants): in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption to each warrant holder; and if, and only if, for any 20 trading days within the 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading "— Warrants — Public Stockholders Warrants — Anti-dilution Adjustments"). We will not redeem the warrants as described above unless a registration statement under the Securities Act covering the issuance of the shares of Class A common stock issuable upon exercise of the warrants is then effective and a current prospectus relating to those Class A common stock is available throughout the 30-day redemption period, unless we have elected to require the exercise of the warrants on a cashless basis and the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. We have established the last of the redemption criteria discussed above to prevent a redemption call unless there is at the time of the call a significant premium to the warrant exercise price. If the foregoing conditions are satisfied and we issue a notice of redemption of the warrants, each warrant holder will be entitled to exercise his, her or its warrant prior to the scheduled redemption date. Any such exercise would not be done on a "cashless" basis and would require the exercising warrant holder to pay the exercise price for each warrant being exercised. However, the price of the Class A common stock may fall below the $18.00 redemption trigger price (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading "— Warrants — Public Stockholders Warrants — Anti-dilution Adjustments") as well as the $11.50 (for whole shares) warrant exercise price after the redemption notice is issued. Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00. Once the warrants become exercisable, we may redeem the outstanding warrants: in whole and not in part; at $0.10 per warrant upon a minimum of 30 days prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to the table below, based on the redemption date and the "fair market value" of our Class A common stock (as defined below) except as otherwise described below; if, and only if, the closing price of our Class A common stock equals or exceeds $10.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading "— Warrants — Public Stockholders Warrants — Anti-dilution Adjustments") for any 20 trading days within the 30-trading day period ending three trading days before we send the notice of redemption to the warrant holders. Beginning on the date the notice of redemption is given until the warrants are redeemed or exercised, holders may elect to exercise their warrants on a cashless basis. The numbers in the table below represent the number of Class A common stock that a warrant holder will receive upon such cashless exercise in connection with a redemption by us pursuant to this redemption feature, based on the "fair market value" of our Class A common stock on the corresponding redemption date (assuming holders elect to exercise their warrants and such warrants are not redeemed for $0.10 per warrant), determined for these purposes based on volume weighted average price of our Class A common stock as reported during the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants, and the number of months that the corresponding redemption date precedes the expiration date of the warrants, each as set forth in the table below. We will provide our warrant holders with the final fair market value no later than one business day after the 10-trading day period described above ends; and 136 if the closing price of our Class A common stock for any 20-trading days within the 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders is less than $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading "— Warrants — Public Stockholders Warrants — Anti-dilution Adjustments"), the private placement warrants must also be concurrently called for redemption on the same terms as the outstanding public warrants, as described above. Pursuant to the warrant agreement, references above to Class A common stock shall include a security other than Class A common stock into which the Class A common stock have been converted or exchanged for in the event we are not the surviving company in our initial business combination. The numbers in the table below will not be adjusted when determining the number of Class A common stock to be issued upon exercise of the warrants if we are not the surviving entity following our initial business combination. The share prices set forth in the column headings of the table below will be adjusted as of any date on which the number of shares issuable upon exercise of a warrant or the exercise price of a warrant is adjusted as set forth under the heading "— Anti-dilution Adjustments" below. If the number of shares issuable upon exercise of a warrant is adjusted, the adjusted share prices in the column headings will equal the share prices immediately prior to such adjustment, multiplied by a fraction, the numerator of which is the exercise price of the warrant after such adjustment and the denominator of which is the price of the warrant immediately prior to such adjustment. In such an event, the number of shares in the table below shall be adjusted by multiplying such share amounts by a fraction, the numerator of which is the number of shares deliverable upon exercise of a warrant immediately prior to such adjustment and the denominator of which is the number of shares deliverable upon exercise of a warrant as so adjusted. If the exercise price of a warrant is adjusted, (a) in the case of an adjustment pursuant to the fifth paragraph under the heading "— Anti-dilution Adjustments" below, the adjusted share prices in the column headings will equal the unadjusted share price multiplied by a fraction, the numerator of which is the higher of the Market Value and the Newly Issued Price as set forth under the heading "— Anti-dilution Adjustments" and the denominator of which is $10.00 and (b) in the case of an adjustment pursuant to the second paragraph under the heading "— Anti-dilution Adjustments" below, the adjusted share prices in the column headings will equal the unadjusted share price less the decrease in the exercise price of a warrant pursuant to such exercise price adjustment. Redemption Date (period to expiration of warrants) Fair Market Value of Class A Common Stock 10.00 11.00 12.00 13.00 14.00 15.00 16.00 17.00 18.00 60 months 0.261 0.281 0.297 0.311 0.324 0.337 0.348 0.358 0.361 57 months 0.257 0.277 0.294 0.310 0.324 0.337 0.348 0.358 0.361 54 months 0.252 0.272 0.291 0.307 0.322 0.335 0.347 0.357 0.361 51 months 0.246 0.268 0.287 0.304 0.320 0.333 0.346 0.357 0.361 48 months 0.241 0.263 0.283 0.301 0.317 0.332 0.344 0.356 0.361 45 months 0.235 0.258 0.279 0.298 0.315 0.330 0.343 0.356 0.361 42 months 0.228 0.252 0.274 0.294 0.312 0.328 0.342 0.355 0.361 39 months 0.221 0.246 0.269 0.290 0.309 0.325 0.340 0.354 0.361 36 months 0.213 0.239 0.263 0.285 0.305 0.323 0.339 0.353 0.361 33 months 0.205 0.232 0.257 0.280 0.301 0.320 0.337 0.352 0.361 30 months 0.196 0.224 0.250 0.274 0.297 0.316 0.335 0.351 0.361 27 months 0.185 0.214 0.242 0.268 0.291 0.313 0.332 0.350 0.361 24 months 0.173 0.204 0.233 0.260 0.285 0.308 0.329 0.348 0.361 21 months 0.161 0.193 0.223 0.252 0.279 0.304 0.326 0.347 0.361 18 months 0.146 0.179 0.211 0.242 0.271 0.298 0.322 0.345 0.361 15 months 0.130 0.164 0.197 0.230 0.262 0.291 0.317 0.342 0.361 12 months 0.111 0.146 0.181 0.216 0.250 0.282 0.312 0.339 0.361 9 months 0.090 0.125 0.162 0.199 0.237 0.272 0.305 0.336 0.361 6 months 0.065 0.099 0.137 0.178 0.219 0.259 0.296 0.331 0.361 3 months 0.034 0.065 0.104 0.150 0.197 0.243 0.286 0.326 0.361 0 months — — 0.042 0.115 0.179 0.233 0.281 0.323 0.361 137 The exact fair market value and redemption date may not be set forth in the table above, in which case, if the fair market value is between two values in the table or the redemption date is between two redemption dates in the table, the number of Class A common stock to be issued for each warrant exercised will be determined by a straight-line interpolation between the number of shares set forth for the higher and lower fair market values and the earlier and later redemption dates, as applicable, based on a 365 or 366-day year, as applicable. For example, if the volume weighted average price of our Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of the warrants is $11.00 per share, and at such time there are 57 months until the expiration of the warrants, holders may choose to, in connection with this redemption feature, exercise their warrants for 0.277 Class A common stock for each whole warrant. For an example where the exact fair market value and redemption date are not as set forth in the table above, if the volume weighted average price of our Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of the warrants is $13.50 per share, and at such time there are 38 months until the expiration of the warrants, holders may choose to, in connection with this redemption feature, exercise their warrants for 0.298 Class A common stock for each whole warrant. In no event will the warrants be exercisable on a cashless basis in connection with this redemption feature for more than 0.361 Class A common stock per warrant (subject to adjustment). Finally, as reflected in the table above, if the warrants are out of the money and about to expire, they cannot be exercised on a cashless basis in connection with a redemption by us pursuant to this redemption feature, since they will not be exercisable for any Class A common stock. This redemption feature differs from the typical warrant redemption features used in many other blank check offerings, which typically only provide for a redemption of warrants for cash (other than the private placement warrants) when the trading price for the Class A common stock exceeds $18.00 per share for a specified period of time. This redemption feature is structured to allow for all of the outstanding warrants to be redeemed when the Class A common stock are trading at or above $10.00 per public share, which may be at a time when the trading price of our Class A common stock is below the exercise price of the warrants. We have established this redemption feature to provide us with the flexibility to redeem the warrants without the warrants having to reach the $18.00 per share threshold set forth above under "— Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00." Holders choosing to exercise their warrants in connection with a redemption pursuant to this feature will, in effect, receive a number of shares for their warrants based on an option pricing model with a fixed volatility input as of the date of this prospectus. This redemption right provides us with an additional mechanism by which to redeem all of the outstanding warrants, and therefore have certainty as to our capital structure as the warrants would no longer be outstanding and would have been exercised or redeemed. We will be required to pay the applicable redemption price to warrant holders if we choose to exercise this redemption right and it will allow us to quickly proceed with a redemption of the warrants if we determine it is in our best interest to do so. As such, we would redeem the warrants in this manner when we believe it is in our best interest to update our capital structure to remove the warrants and pay the redemption price to the warrant holders. As stated above, we can redeem the warrants when the Class A common stock are trading at a price starting at $10.00, which is below the exercise price of $11.50, because it will provide certainty with respect to our capital structure and cash position while providing warrant holders with the opportunity to exercise their warrants on a cashless basis for the applicable number of shares. If we choose to redeem the warrants when the Class A common stock are trading at a price below the exercise price of the warrants, this could result in the warrant holders receiving fewer Class A common stock than they would have received if they had chosen to wait to exercise their warrants for Class A common stock if and when such Class A common stock were trading at a price higher than the exercise price of $11.50. No fractional Class A common stock will be issued upon exercise. If, upon exercise, a holder would be entitled to receive a fractional interest in a share, we will round down to the nearest whole number of the number of Class A common stock to be issued to the holder. If, at the time of redemption, the warrants are exercisable for a security other than the Class A common stock pursuant to the warrant agreement (for instance, if we are not the surviving company in our initial business combination), the warrants may be exercised for such security. At such time as the warrants become exercisable for a security other than the Class A common stock, the Company (or surviving company) will use its commercially reasonable efforts to register under the Securities Act the security issuable upon the exercise of the warrants. 138 Maximum Percentage Procedures. A holder of a warrant may notify us in writing in the event it elects to be subject to a requirement that such holder will not have the right to exercise such warrant, to the extent that after giving effect to such exercise, such person (together with such person s affiliates), to the warrant agent s actual knowledge, would beneficially own in excess of 4.9% or 9.8% (or such other amount as a holder may specify) of the Class A common stock issued and outstanding immediately after giving effect to such exercise. Anti-Dilution Adjustments. If the number of outstanding Class A common stock is increased by a capitalization or share dividend payable in Class A common stock, or by a split-up of common stock or other similar event, then, on the effective date of such capitalization or share dividend, split-up or similar event, the number of Class A common stock issuable on exercise of each warrant will be increased in proportion to such increase in the outstanding common stock. A rights offering made to all or substantially all holders of common stock entitling holders to purchase Class A common stock at a price less than the "historical fair market value" (as defined below) will be deemed a share dividend of a number of Class A common stock equal to the product of (i) the number of Class A common stock actually sold in such rights offering (or issuable under any other equity securities sold in such rights offering that are convertible into or exercisable for Class A common stock) and (ii) one minus the quotient of (x) the price per share of Class A common stock paid in such rights offering and (y) the historical fair market value. For these purposes, (i) if the rights offering is for securities convertible into or exercisable for Class A common stock, in determining the price payable for Class A common stock, there will be taken into account any consideration received for such rights, as well as any additional amount payable upon exercise or conversion and (ii) "historical fair market value" means the volume weighted average price of Class A common stock as reported during the 10 trading day period ending on the trading day prior to the first date on which the Class A common stock trade on the applicable exchange or in the applicable market, regular way, without the right to receive such rights. In addition, if we, at any time while the warrants are outstanding and unexpired, pay a dividend or make a distribution in cash, securities or other assets to all or substantially all of the holders of the Class A common stock on account of such Class A common stock (or other securities into which the warrants are convertible), other than (a) as described above, (b) any cash dividends or cash distributions which, when combined on a per share basis with all other cash dividends and cash distributions paid on the Class A common stock during the 365-day period ending on the date of declaration of such dividend or distribution does not exceed $0.50 (as adjusted to appropriately reflect any other adjustments and excluding cash dividends or cash distributions that resulted in an adjustment to the exercise price or to the number of Class A common stock issuable on exercise of each warrant) but only with respect to the amount of the aggregate cash dividends or cash distributions equal to or less than $0.50 per share, (c) to satisfy the redemption rights of the holders of Class A common stock in connection with a proposed initial business combination, (d) to satisfy the redemption rights of the holders of Class A common stock in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to provide holders of our Class A common stock the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering or (B) with respect to any other provision relating to the rights of holders of our Class A common stock, or (e) in connection with the redemption of our public shares upon our failure to complete our initial business combination, then the warrant exercise price will be decreased, effective immediately after the effective date of such event, by the amount of cash and/or the fair market value of any securities or other assets paid on each share of Class A common stock in respect of such event. If the number of outstanding Class A common stock is decreased by a consolidation, combination, reverse share splits or reclassification of Class A common stock or other similar event, then, on the effective date of such consolidation, combination, reverse share splits, reclassification or similar event, the number of Class A common stock issuable on exercise of each warrant will be decreased in proportion to such decrease in outstanding Class A common stock. Whenever the number of Class A common stock purchasable upon the exercise of the warrants is adjusted, as described above, the warrant exercise price will be adjusted by multiplying the warrant exercise price immediately prior to such adjustment by a fraction (x) the numerator of which will be the number of Class A common stock purchasable upon the exercise of the warrants immediately prior to such adjustment and (y) the denominator of which will be the number of Class A common stock so purchasable immediately thereafter. 139 In addition, if (x) we issue additional Class A common stock or equity-linked securities, for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or such affiliates, as applicable, prior to such issuance) (the "Newly Issued Price"), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our Class A common stock during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the "Market Value") is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, the $18.00 per share redemption trigger price described above under "— Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00" and "— Redemption of warrants when the price per Class A common stock equals or exceeds $10.00" will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price, and the $10.00 per share redemption trigger price described above under "— Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00" will be adjusted (to the nearest cent) to be equal to the higher of the Market Value and the Newly Issued Price. In case of any reclassification or reorganization of the outstanding Class A common stock (other than those described above or that solely affects the par value of such Class A common stock), or in the case of any merger or consolidation of us with or into another corporation (other than a consolidation or merger in which we are the continuing corporation and that does not result in any reclassification or reorganization of our outstanding Class A common stock), or in the case of any sale or conveyance to another corporation or entity of the assets or other property of us as an entirety or substantially as an entirety in connection with which we are dissolved, the holders of the warrants will thereafter have the right to purchase and receive, upon the basis and upon the terms and conditions specified in the warrants and in lieu of the Class A common stock immediately theretofore purchasable and receivable upon the exercise of the rights represented thereby, the kind and amount of Class A common stock or other securities or property (including cash) receivable upon such reclassification, reorganization, merger or consolidation, or upon a dissolution following any such sale or transfer, that the holder of the warrants would have received if such holder had exercised their warrants immediately prior to such event. However, if such holders were entitled to exercise a right of election as to the kind or amount of securities, cash or other assets receivable upon such consolidation or merger, then the kind and amount of securities, cash or other assets for which each warrant will become exercisable will be deemed to be the weighted average of the kind and amount received per share by such holders in such consolidation or merger that affirmatively make such election, and if a tender, exchange or redemption offer has been made to and accepted by such holders (other than a tender, exchange or redemption offer made by the company in connection with redemption rights held by stockholders of the company as provided for in the company s amended and restated certificate of incorporation or as a result of the redemption of Class A common stock by the company if a proposed initial business combination is presented to the stockholders of the company for approval) under circumstances in which, upon completion of such tender or exchange offer, the maker thereof, together with members of any group (within the meaning of Rule 13d-5(b)(1) under the Exchange Act) of which such maker is a part, and together with any affiliate or associate of such maker (within the meaning of Rule 12b-2 under the Exchange Act) and any members of any such group of which any such affiliate or associate is a part, own beneficially (within the meaning of Rule 13d-3 under the Exchange Act) more than 50% of the issued and outstanding Class A common stock, the holder of a warrant will be entitled to receive the highest amount of cash, securities or other property to which such holder would actually have been entitled as a stockholder if such warrant holder had exercised the warrant prior to the expiration of such tender or exchange offer, accepted such offer and all of the Class A common stock held by such holder had been purchased pursuant to such tender or exchange offer, subject to adjustment (from and after the consummation of such tender or exchange offer) as nearly equivalent as possible to the adjustments provided for in the warrant agreement. If less than 70% of the consideration receivable by the holders of Class A common stock in such a transaction is payable in the form of Class A common stock in the successor entity that is listed for trading on a national securities exchange or is quoted in an established over-the-counter market, or is to be so listed for trading or quoted immediately following such event, and if the registered holder of the warrant properly exercises the warrant within thirty days following public disclosure of such transaction, the warrant exercise price will be reduced as specified in the warrant agreement based 140 on the Black-Scholes value (as defined in the warrant agreement) of the warrant. The purpose of such exercise price reduction is to provide additional value to holders of the warrants when an extraordinary transaction occurs during the exercise period of the warrants pursuant to which the holders of the warrants otherwise do not receive the full potential value of the warrants. The warrants will be issued in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. The warrant agreement provides that the terms of the warrants may be amended without the consent of any holder for the purpose of (i) curing any ambiguity or correcting any mistake, including to conform the provisions of the warrant agreement to the description of the terms of the warrants and the warrant agreement set forth in this prospectus, or defective provision (ii) amending the provisions relating to cash dividends on common stock as contemplated by and in accordance with the warrant agreement or (iii) adding or changing any provisions with respect to matters or questions arising under the warrant agreement as the parties to the warrant agreement may deem necessary or desirable and that the parties deem to not adversely affect the rights of the registered holders of the warrants, provided that the approval by the holders of at least 50% of the then-outstanding public warrants is required to make any change that adversely affects the interests of the registered holders. You should review a copy of the warrant agreement, which will be filed as an exhibit to the registration statement of which this prospectus is a part, for a complete description of the terms and conditions applicable to the warrants. The Company in its sole discretion may lower the Warrant Price at any time prior to the expiration date of the warrants for a period of not less than 20 business days (unless otherwise required by the SEC, any national securities exchange on which the warrants are listed or applicable law), provided, that the Company must provide at least 5 business days prior written notice of such reduction to registered holders and, provided further that any such reduction must be identical among all of the warrants. The warrant holders do not have the rights or privileges of holders of common stock and any voting rights until they exercise their warrants and receive Class A common stock. After the issuance of Class A common stock upon exercise of the warrants, each holder will be entitled to one vote for each share held of record on all matters to be voted on by stockholders. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. If, upon exercise of the warrants, a holder would be entitled to receive a fractional interest in a share, we will, upon exercise, round down to the nearest whole number the number of Class A common stock to be issued to the warrant holder. We have agreed that, subject to applicable law, any action, proceeding or claim against us arising out of or relating in any way to the warrant agreement will be brought and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and we irrevocably submit to such jurisdiction, which jurisdiction will be the exclusive forum for any such action, proceeding or claim. See "Risk Factors — Our warrant agreement will designate the courts of the State of New York or the United States District Court for the Southern District of New York as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by holders of our warrants, which could limit the ability of warrant holders to obtain a favorable judicial forum for disputes with our company." This provision applies to claims under the Securities Act but does not apply to claims under the Exchange Act or any claim for which the federal district courts of the United States of America are the sole and exclusive forum. Private Placement Warrants The private placement warrants (including the Class A common stock issuable upon exercise of the private placement warrants) will not be transferable, assignable or salable until 30 days after the completion of our initial business combination (except, among other limited exceptions as described under the section of this prospectus entitled "Principal Stockholders — Restrictions on Transfers of Founder Shares and Private Placement Warrants," to our officers and directors and other persons or entities affiliated with our sponsor) and they will not be redeemable by us so long as they are held by our sponsor, William Blair or their respective permitted transferees. Except as described below, the private placement warrants have terms and provisions that are identical to those of the warrants being sold as part of the units in this offering, including as to exercise price, exercisability and exercise period. If the private placement warrants are held by holders other than the sponsor, William Blair or their respective permitted transferees, the private placement warrants will be redeemable by us and exercisable by the holders on the same basis as the warrants included in the units being sold in this offering. Any amendment to the terms of the private placement warrants or any provision of the warrant agreement with respect to the private placement warrants will require a vote of holders of at least 50% of the number of the then-outstanding private placement warrants. 141 If holders of the private placement warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering their warrants for that number of shares of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A common stock underlying the warrants multiplied by the excess of the "fair market value" (defined below) over the exercise price of the warrants by (y) the fair market value. The "fair market value" means the average reported closing price of the Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent. The reason that we have agreed that these warrants will be exercisable on a cashless basis so long as they are held by the sponsor or its permitted transferees is because it is not known at this time whether they will be affiliated with us following an initial business combination. If they remain affiliated with us, their ability to sell our securities in the open market will be significantly limited. We expect to have policies in place that prohibit insiders from selling our securities except during specific periods of time. Even during such periods of time when insiders will be permitted to sell our securities, an insider cannot trade in our securities if he or she is in possession of material non-public information. Accordingly, unlike public stockholders who could exercise their warrants sell the shares of Class A common stock issuable upon exercise of the warrants freely in the open market, the insiders could be significantly restricted from doing so. As a result, we believe that allowing the holders to exercise such warrants on a cashless basis is appropriate. In order to finance transaction costs in connection with an intended initial business combination, our sponsor or an affiliate of our sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. Up to $1,500,000 of such loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender. Such warrants would be identical to the private placement warrants, including as to exercise price, exercisability and exercise period. The terms of such working capital loans by our sponsor or their affiliates, or our officers and directors, if any, have not been determined and no written agreements exist with respect to such loans. In addition, if we anticipate that we may not be able to consummate our initial business combination, we may extend the period of time to consummate a business combination as described in this prospectus. For a Paid Extension, our sponsor and its affiliates or designees are obligated to fund the trust account to extend the time for us to complete our initial business combination, but our sponsor and its affiliates will not be obligated to extend such time. Any such payments would be made in the form of a loan, which will be non-interest bearing and payable upon the consummation of our initial business combination. For each Paid Extension, up to $1,750,000, or $2,012,500 if the underwriters over-allotment option is exercised in full, of such loans to extend such period of time may be convertible into warrants of the post-business combination entity at a price of $1.00 per warrant at the option of the lender. Such warrants would be identical to the private placement warrants, including as to exercise price, exercisability and exercise period. Our sponsor has agreed not to transfer, assign or sell any of the private placement warrants (including the Class A common stock issuable upon exercise of any of these warrants) until the date that is 30 days after the date we complete our initial business combination, except that, among other limited exceptions as described under the section of this prospectus entitled "Principal Stockholders — Restrictions on Transfers of Founder Shares and Private Placement Warrants" made to our officers and directors and other persons or entities affiliated with our sponsor. Dividends We have not paid any cash dividends on our common stock to date and do not intend to pay cash dividends prior to the completion of an initial business combination. The payment of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial conditions subsequent to completion of an initial business combination. The payment of any cash dividends subsequent to an initial business combination will be within the discretion of our board of directors at such time. If we increase or decrease the size of this offering we will effect a stock dividend or a share contribution back to capital or other appropriate mechanism, as applicable, with respect to our Class B common stock immediately prior to the consummation of the offering in such amount as to maintain the ownership of our initial stockholders at 20% of the issued and outstanding shares of our common stock upon the consummation of this offering. Further, if we incur any indebtedness, our ability to declare dividends may be limited by restrictive covenants we may agree to in connection therewith. Our Transfer Agent and Warrant Agent The transfer agent for our common stock and warrant agent for our warrants is Continental Stock Transfer & Trust Company. We have agreed to indemnify Continental Stock Transfer & Trust Company in its roles as transfer agent 142 and warrant agent, its agents and each of its stockholders, directors, officers and employees against all claims and losses that may arise out of acts performed or omitted for its activities in that capacity, except for any liability due to any gross negligence, willful misconduct or bad faith of the indemnified person or entity. Our Amended and Restated Certificate of Incorporation Our amended and restated certificate of incorporation will contain certain requirements and restrictions relating to this offering that will apply to us until the completion of our initial business combination. These provisions cannot be amended without the approval of the holders of 65% of our common stock. Our initial stockholders, who will collectively beneficially own 20% of our common stock upon the closing of this offering (assuming they do not purchase any units in this offering), will participate in any vote to amend our amended and restated certificate of incorporation and will have the discretion to vote in any manner they choose. Specifically, our amended and restated certificate of incorporation will provide, among other things, that: if we are unable to complete our initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than 10 business days thereafter subject to lawfully available funds therefor, redeem 100% of the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law; prior to our initial business combination, we may not issue additional shares of capital stock that would entitle the holders thereof to (i) receive funds from the trust account, (ii) vote on any initial business combination or (iii) vote on matters related to our pre-initial business combination activity; although we do not intend to enter into an initial business combination with a target business that is affiliated with our sponsor, our directors or our officers, we are not prohibited from doing so. In the event we enter into such a transaction, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions, that such an initial business combination is fair to our company from a financial point of view; if a stockholder vote on our initial business combination is not required by law and we do not decide to hold a stockholder vote for business or other legal reasons, we will offer to redeem our public shares pursuant to Rule 13e-4 and Regulation 14E under the Exchange Act, and will file tender offer documents with the SEC prior to completing our initial business combination, which contain substantially the same financial and other information about our initial business combination and the redemption rights as is required under Regulation 14A under the Exchange Act; whether or not we maintain our registration under the our Exchange Act or our listing on the NYSE, we will provide our public stockholders with the opportunity to redeem their public shares by one of the two methods listed above; so long as we obtain and maintain a listing for our securities on the NYSE, the NYSE rules require that we must consummate an initial business combination with one or more operating businesses or assets with a fair market value equal to at least 80% of the net assets held in the trust account (net of amounts disbursed to management for working capital purposes, if any, and excluding the amount of deferred underwriting discounts held in trust and taxes payable on the income earned on the trust account); if our stockholders approve an amendment to our amended and restated certificate of incorporation to (A) modify the substance or timing of our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 21 months, if we extend the 143 period of time to complete our initial business combination, as described herein) from the closing of this offering or (B) with respect to any other material provisions relating to Class A common stockholders rights or pre-initial business combination activity, we will provide our public stockholders with the opportunity to redeem all or a portion of their shares of Class A common stock upon such approval at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares; and we will not effectuate our initial business combination solely with another blank check company or a similar company with nominal operations. In addition, our amended and restated certificate of incorporation will provide that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of deferred underwriters fees and commissions. Certain Anti-Takeover Provisions of Delaware Law and our Amended and Restated Certificate of Incorporation and Bylaws We will be subject to the provisions of Section 203 of the DGCL regulating corporate takeovers upon completion of this offering. This statute prevents certain Delaware corporations, under certain circumstances, from engaging in a "business combination" with: a stockholder who owns 15% or more of our outstanding voting stock (otherwise known as an "interested stockholder"); an affiliate of an interested stockholder; or an associate of an interested stockholder, for three years following the date that the stockholder became an interested stockholder. A "business combination" includes a merger or sale of more than 10% of our assets. However, the above provisions of Section 203 do not apply if: our board of directors approves the transaction that made the stockholder an "interested stockholder," prior to the date of the transaction; after the completion of the transaction that resulted in the stockholder becoming an interested stockholder, that stockholder owned at least 85% of our voting stock outstanding at the time the transaction commenced, other than statutorily excluded shares of common stock; or on or subsequent to the date of the transaction, the initial business combination is approved by our board of directors and authorized at a meeting of our stockholders, and not by written consent, by an affirmative vote of at least two-thirds of the outstanding voting stock not owned by the interested stockholder. Our amended and restated certificate of incorporation will provide that our board of directors will be classified into three classes of directors. As a result, in most circumstances, a person can gain control of our board only by successfully engaging in a proxy contest at two or more annual meetings. Our authorized but unissued common stock and preferred stock are available for future issuances without stockholder approval and could be utilized for a variety of corporate purposes, including future offerings to raise additional capital, acquisitions and employee benefit plans. The existence of authorized but unissued and unreserved common stock and preferred stock could render more difficult or discourage an attempt to obtain control of us by means of a proxy contest, tender offer, merger or otherwise. Exclusive forum for certain lawsuits Our amended and restated certificate of incorporation will require, to the fullest extent permitted by law, that derivative actions brought in our name, actions against directors, officers and employees for breach of fiduciary duty 144 and certain other actions may be brought only in the Court of Chancery in the State of Delaware, except any action (A) as to which the Court of Chancery in the State of Delaware determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), (B) which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery or (C) for which the Court of Chancery does not have subject matter jurisdiction. If an action is brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to service of process on such stockholder s counsel. Although we believe this provision benefits us by providing increased consistency in the application of law in the types of lawsuits to which it applies, a court may determine that this provision is unenforceable, and to the extent it is enforceable, the provision may have the effect of discouraging lawsuits against our directors and officers. In addition, this provision may result in our stockholders incurring increased costs to bring a claim or action due to, but not limited to, the stockholder s physical location or knowledge of the applicable laws, when the federal district courts of the United States or the Court of Chancery of the State of Delaware, or an alternative forum, with our consent, is the sole and exclusive forum. Our amended and restated certificate of incorporation will provide that the exclusive forum provision will be applicable to the fullest extent permitted by applicable law, subject to certain exceptions. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. As a result, the exclusive forum provision will not apply to suits brought to enforce any duty or liability created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction. In addition, our amended and restated certificate of incorporation will provide that, unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States of America shall, to the fullest extent permitted by law, be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended, or the rules and regulations promulgated thereunder. We note, however, that there is uncertainty as to whether a court would enforce this provision and that investors cannot waive compliance with the federal securities laws and the rules and regulations thereunder. Section 22 of the Securities Act creates concurrent jurisdiction for state and federal courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. Special meeting of stockholders Our bylaws provide that special meetings of our stockholders may be called only by a majority vote of our board of directors, by our Co-Chief Executive Officers or by the Chairperson. Advance notice requirements for stockholder proposals and director nominations Our bylaws provide that stockholders seeking to bring business before our annual meeting of stockholders, or to nominate candidates for election as directors at our annual meeting of stockholders, must provide timely notice of their intent in writing. To be timely, a stockholder s notice will need to be received by our secretary at our principal executive offices not later than the close of business on the 90th day nor earlier than the opening of business on the 120th day prior to the anniversary date of the immediately preceding annual meeting of stockholders. Pursuant to Rule 14a-8 under the Exchange Act, proposals seeking inclusion in our annual proxy statement must comply with the notice periods contained therein. Our bylaws also specify certain requirements as to the form and content of a stockholders meeting. These provisions may preclude our stockholders from bringing matters before our annual meeting of stockholders or from making nominations for directors at our annual meeting of stockholders. Action by written consent Subsequent to the consummation of the offering, any action required or permitted to be taken by our common stockholders must be effected by a duly called annual or special meeting of such stockholders and may not be effected by written consent of the stockholders other than with respect to our Class B common stock. Classified Board of Directors Our board of directors will initially be divided into three classes, Class I, Class II and Class III, with members of each class serving staggered three-year terms. Our amended and restated certificate of incorporation will provide 145 that the authorized number of directors may be changed only by resolution of the board of directors. Subject to the terms of any preferred stock, any or all of the directors may be removed from office at any time, but only for cause and only by the affirmative vote of holders of a majority of the voting power of all then outstanding shares of our capital stock entitled to vote generally in the election of directors, voting together as a single class. Any vacancy on our board of directors, including a vacancy resulting from an enlargement of our board of directors, may be filled only by vote of a majority of our directors then in office. Class B common stock consent right For so long as any shares of Class B common stock remain outstanding, we may not, without the prior vote or written consent of the holders of a majority of the shares of Class B common stock then outstanding, voting separately as a single class, amend, alter or repeal any provision of our certificate of incorporation, whether by merger, consolidation or otherwise, if such amendment, alteration or repeal would alter or change the powers, preferences or relative, participating, optional or other or special rights of the Class B common stock. Any action required or permitted to be taken at any meeting of the holders of Class B common stock may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of the outstanding Class B common stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares of Class B common stock were present and voted. Securities Eligible for Future Sale Immediately after the consummation of this offering (assuming no exercise of the underwriters over-allotment option and forfeiture of 656,250 shares of Class B common stock) we will have 21,875,000 (or 25,156,250 if the underwriters over-allotment option is exercised in full) shares of common stock outstanding. All 17,500,000 of the shares sold in this offering and will be freely tradable without restriction or further registration under the Securities Act, except for any shares purchased by one of our affiliates within the meaning of Rule 144 under the Securities Act. All of the remaining 4,375,000 (or 5,031,250 if the underwriters over-allotment option is exercised in full) shares and all 9,700,000 (or 10,750,000 if the underwriters over-allotment option is exercised in full) private placement warrants are restricted securities under Rule 144, in that they were issued in private transactions not involving a public offering, and the shares of Class B common stock and private placement warrants are subject to transfer restrictions as set forth elsewhere in this prospectus. These restricted securities will be entitled to registration rights as more fully described below under "— Registration Rights." Rule 144 Pursuant to Rule 144, a person who has beneficially owned restricted shares of our common stock or warrants for at least six months would be entitled to sell their securities; provided that (i) such person is not deemed to have been one of our affiliates at the time of, or at any time during the three months preceding, a sale and (ii) we are subject to the Exchange Act periodic reporting requirements for at least three months before the sale and have filed all required reports under Section 13 or 15(d) of the Exchange Act during the 12 months (or such shorter period as we were required to file reports) preceding the sale. Persons who have beneficially owned restricted shares of our common stock or warrants for at least six months but who are our affiliates at the time of, or at any time during the three months preceding, a sale, would be subject to additional restrictions, by which such person would be entitled to sell within any three-month period only a number of securities that does not exceed the greater of: 1% of the total number of shares of Class A common stock then outstanding, which will equal 175,000 shares immediately after this offering (or 201,250 if the underwriters exercise their over-allotment option in full); or the average weekly reported trading volume of the Class A common stock during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale. Sales by our affiliates under Rule 144 are also limited by manner of sale provisions and notice requirements and to the availability of current public information about us. 146 Restrictions on the Use of Rule 144 by Shell Companies or Former Shell Companies Rule 144 is not available for the resale of securities initially issued by shell companies (other than business combination related shell companies) or issuers that have been at any time previously a shell company. However, Rule 144 also includes an important exception to this prohibition if the following conditions are met: the issuer of the securities that was formerly a shell company has ceased to be a shell company; the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act; the issuer of the securities has filed all Exchange Act reports and materials required to be filed, as applicable, during the preceding 12 months (or such shorter period that the issuer was required to file such reports and materials), other than Current Reports on Form 8-K; and at least one year has elapsed from the time that the issuer filed current Form 10 type information with the SEC reflecting its status as an entity that is not a shell company. As a result, our initial stockholders will be able to sell their founder shares and private placement warrants, as applicable, pursuant to Rule 144 without registration one year after we have completed our initial business combination. Registration Rights The holders of (i) the founder shares, which were issued in a private placement prior to the closing of this offering, (ii) private placement warrants, which will be issued in a private placement simultaneously with the closing of this offering and the shares of Class A common stock underlying such private placement warrants and (iii) private placement warrants that may be issued upon conversion of working capital loans or extension loans (and their underlying securities) will have registration rights to require us to register a sale of any of our securities held by them pursuant to a registration rights agreement to be signed prior to or on the effective date of this offering. These holders of these securities will be entitled to make up to three demands, excluding short form registration demands, that we register such securities for sale under the Securities Act. In addition, these holders will have "piggy-back" registration rights to include their securities in other registration statements filed by us, subject to certain limitations. We will bear the expenses incurred in connection with the filing of any such registration statements. Listing of Securities We intend to apply to list our units, Class A common stock and warrants on the NYSE under the symbols "FDHAU," "FDHA" and "FDHAW," respectively. We expect that our units will be listed on the NYSE on or promptly after the effective date of the registration statement. Following the date the shares of our Class A common stock and warrants are eligible to trade separately, we anticipate that the shares of our Class A common stock and warrants will be listed separately and as a unit on the NYSE. We cannot guarantee that our securities will be approved for listing on the NYSE. 147 U.S. FEDERAL INCOME TAX CONSIDERATIONS The following discussion summarizes U.S. federal income tax considerations generally applicable to the ownership and disposition of our units (each consisting of one share of Class A common stock and one-half of one redeemable warrant) that are purchased in this offering by U.S. Holders (as defined below) and Non-U.S. Holders (as defined below). Because the components of a unit are generally separable at the option of the holder, as discussed below, this summary generally assumes that the holder of a unit generally is treated, for U.S. federal income tax purposes, as the owner of the underlying Class A common stock and one-half of one redeemable warrant components of the unit, as the case may be. This discussion is limited to certain U.S. federal income tax considerations to beneficial owners of our securities who are initial purchasers of a unit pursuant to this offering and hold the unit and each component of the unit as a capital asset within the meaning of Section 1221 of the U.S. Internal Revenue Code of 1986, as amended (the "Code"). This discussion assumes that the common stock and warrants will trade separately and that any distributions made (or deemed made) by us on our common stock and any consideration received (or deemed received) by a holder in consideration for the sale or other disposition of our securities will be in U.S. dollars. This discussion is a summary only and does not consider all aspects of U.S. federal income taxation that may be relevant to the ownership and disposition of a unit by a prospective investor in light of its particular circumstances, including: financial institutions or financial services entities; broker-dealers; taxpayers that are subject to the mark-to-market accounting rules; tax-exempt entities; governments or agencies or instrumentalities thereof; insurance companies; regulated investment companies; real estate investment trusts; controlled foreign corporations; passive foreign investment companies; expatriates or former long-term residents of the United States; persons that actually or constructively own five percent or more (by vote or value) of our shares; persons that acquired our securities pursuant to an exercise of employee share options, in connection with employee share incentive plans or otherwise as compensation; persons that hold our securities as part of a straddle, constructive sale, hedging, conversion or other integrated or similar transaction; our sponsor, founders, officers or directors; or U.S. Holders (as defined below) whose functional currency is not the U.S. dollar. The discussion below is based upon the provisions of the Code, the Treasury regulations promulgated thereunder and administrative and judicial interpretations thereof, all as of the date hereof, and such provisions may be repealed, revoked, modified or subject to differing interpretations, possibly on a retroactive basis, so as to result in U.S. federal income tax consequences different from those discussed below. Furthermore, this discussion does not address any aspect of U.S. federal non-income tax laws, such as gift, estate or Medicare contribution tax laws, or state, local or non-U.S. tax laws. 148 We have not sought, and will not seek, a ruling from the IRS as to any U.S. federal income tax consequence described herein. The IRS may disagree with the discussion herein, and its determination may be upheld by a court. Moreover, there can be no assurance that future legislation, regulations, administrative rulings or court decisions will not adversely affect the accuracy of the statements in this discussion. You are urged to consult your tax advisor with respect to the application of U.S. federal tax laws to your particular situation, as well as any tax consequences arising under the laws of any state, local or foreign jurisdiction. This discussion does not consider the tax treatment of partnerships or other pass-through entities or persons who hold our securities through such entities. If a partnership (or other entity or arrangement classified as a partnership for U.S. federal income tax purposes) is the beneficial owner of our securities, the U.S. federal income tax treatment of a partner in the partnership generally will depend on the status of the partner and the activities of the partnership. Partnerships holding our securities and partners in such partnerships are urged to consult their own tax advisors. THIS DISCUSSION IS ONLY A SUMMARY OF THE U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE ACQUISITION, OWNERSHIP AND DISPOSITION OF OUR SECURITIES. EACH PROSPECTIVE INVESTOR IN OUR SECURITIES IS URGED TO CONSULT ITS OWN TAX ADVISOR WITH RESPECT TO THE PARTICULAR TAX CONSEQUENCES TO SUCH INVESTOR OF THE ACQUISITION, OWNERSHIP AND DISPOSITION OF OUR SECURITIES, INCLUDING THE APPLICABILITY AND EFFECT OF ANY STATE, LOCAL, AND NON-U.S. TAX LAWS, AS WELL AS U.S. FEDERAL TAX LAWS AND ANY APPLICABLE TAX TREATIES. Personal Holding Company Status We could be subject to a second level of U.S. federal income tax on a portion of our income if we are determined to be a personal holding company ("PHC") for U.S. federal income tax purposes. A U.S. corporation generally will be classified as a PHC for U.S. federal income tax purposes in a given taxable year if (1) at any time during the last half of such taxable year, five or fewer individuals (without regard to their citizenship or residency and including as individuals for this purpose certain entities such as certain tax-exempt organizations, pension funds and charitable trusts) own or are deemed to own (pursuant to certain constructive ownership rules) more than 50% of the stock of the corporation by value and (2) at least 60% of the corporation s adjusted ordinary gross income, as determined for U.S. federal income tax purposes, for such taxable year consists of PHC income (which includes, among other things, dividends, interest, certain royalties, annuities and, under certain circumstances, rents). At least 60% of our adjusted ordinary gross income may consist of PHC income, depending on the date and size of our initial business combination. In addition, depending on the concentration of our stock in the hands of individuals, including the members of our sponsor and certain tax-exempt organizations, pension funds and charitable trusts, more than 50% of our stock may be owned or deemed owned (pursuant to the constructive ownership rules) by such persons during the last half of a taxable year. Thus, no assurance can be given that we will not be a PHC following this offering or in the future. If we are or were to become a PHC in a given taxable year, we would be subject to an additional PHC tax, currently 20%, on our undistributed PHC income, which generally includes our taxable income, subject to certain adjustments. Allocation of Purchase Price and Characterization of a Unit There is no statutory, administrative or judicial authority directly addressing the treatment, for U.S. federal income tax purposes, of securities with terms substantially the same as the units, and, therefore, that treatment is not entirely clear. The acquisition of a unit may be treated for U.S. federal income tax purposes as the acquisition of one share of Class A common stock and one-half of one redeemable warrant to acquire one share of Class A common stock. Where the components of a unit are generally separable at the option of the holder, the holder of a unit generally should be treated, for U.S. federal income tax purposes, as the owner of the underlying Class A common stock and one-half of one redeemable warrant components of the unit, as the case may be, and therefore, the separation of the common stock and the warrant comprising a unit should not be a taxable event for U.S. federal income tax purposes. We intend to treat the acquisition of a unit in this manner and, by purchasing a unit, you agree to adopt such treatment for U.S. federal income tax purposes. Each holder of a unit must allocate the purchase price paid by such holder for such unit between the common stock and the warrant that comprise the unit based on their respective relative fair market values at the time of issuance. Under U.S. federal income tax law, each investor must make their 149 own determination of such value based on all the relevant facts and circumstances. Therefore, we strongly urge each investor to consult their tax advisor regarding the determination of value for these purposes. A holder s initial tax basis in the shares of common stock and the warrant included in each unit should equal the portion of the purchase price of the unit allocated thereto. Any disposition of a unit should be treated for U.S. federal income tax purposes as a disposition of the shares of common stock and the warrant comprising the unit, and the amount realized on the disposition should be allocated between the common stock and the warrant based on their respective relative fair market values at the time of disposition. The foregoing treatment of our common stock and warrants and a holder s purchase price allocation are not binding on the IRS or the courts. Because there are no authorities that directly address instruments that are similar to the units, no assurance can be given that the IRS or the courts will agree with the characterization described above or the discussion below. Accordingly, each holder is advised to consult its own tax advisor regarding the risks associated with an investment in a unit (including alternative characterizations of a unit). The balance of this discussion generally assumes that the characterization of the units described above is respected for U.S. federal income tax purposes. U.S. Holders This section applies to you if you are a "U.S. Holder." A U.S. Holder is a beneficial owner of our units, Class A common stock or warrants who or that is: an individual who is a citizen or resident of the United States as determined for U.S. federal income tax purposes; a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) organized in or under the laws of the United States, any state thereof or the District of Columbia; an estate whose income is subject to U.S. federal income tax regardless of its source; or a trust, if (i) a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons (as defined in the Code) have authority to control all substantial decisions of the trust or (ii) it has a valid election in effect under Treasury Regulations to be treated as a U.S. person. Taxation of Distributions If we pay distributions in cash or other property (other than certain distributions of our stock or rights to acquire our stock) to U.S. Holders of shares of our Class A common stock, such distributions generally will be treated as a dividend for U.S. federal income tax purposes to the extent the distribution is paid out of our current or accumulated earnings and profits (as determined under U.S. federal income tax principles). Distributions in excess of such earnings and profits generally will be applied against and reduce the U.S. Holder s basis in our Class A common stock (but not below zero). Any remaining excess will be treated as gain from the sale or other disposition of the shares of Class A common stock and will be treated as described below under "— Gain or Loss on Sale, Taxable Exchange or Other Taxable Disposition of Class A Common Stock and Warrants". Dividends we pay to a U.S. Holder that is a taxable corporation generally will qualify for the dividends received deduction if the requisite holding period is satisfied. With certain exceptions (including, but not limited to, dividends treated as investment income for purposes of investment interest deduction limitations), and provided certain holding period requirements are met, dividends we pay to a non-corporate U.S. holder may constitute "qualified dividends" that will be subject to tax at the maximum tax rate accorded to long-term capital gains. It is unclear whether the redemption rights with respect to the Class A common stock described in this prospectus may prevent a U.S. holder from satisfying the applicable holding period requirements with respect to the dividends received deduction or the preferential tax rate on qualified dividend income, as the case may be, during the period in which the U.S. Holder has redemption rights with respect to the Class A common stock (i.e., the period prior to the consummation of our initial business combination). If the holding period requirements are not satisfied, then a corporation may not be able to qualify for the dividends received deduction and would have taxable income equal to the entire dividend amount, and non-corporate holders may be subject to tax on such dividend at regular ordinary income tax rates instead of the preferential rate that applies to qualified dividend income. 150 Possible Constructive Distributions The terms of each warrant provide for an adjustment to the number of shares of Class A common stock for which the warrant may be exercised or to the exercise price of the warrant in certain events (including if we issue additional shares of common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at a Newly Issued Price of less than $9.20 per share), as discussed in the section of this prospectus captioned "Description of Securities — Redeemable Warrants — Public Stockholders Warrants." An adjustment which has the effect of preventing dilution generally is not taxable. However, U.S. Holders of the warrants may be treated as receiving a constructive distribution from us if, for example, the adjustment increases the warrant holders proportionate interest in our assets or earnings and profits (e.g., through an increase in the number of shares of Class A common stock that would be obtained upon exercise or through a decrease to the exercise price) as a result, for example, of a taxable distribution of cash or other property to the holders of our Class A common stock. Any constructive distribution to a U.S. Holder generally would be treated as if such U.S. Holder had received a cash distribution from us generally equal to the fair market value of such increased interest (taxed as described above under "— Taxation of Distributions"). For certain information reporting purposes, we are required to determine the date and amount of any such constructive distributions. Proposed Treasury regulations, which we may rely on prior to the issuance of final regulations, specify how the date and amount of constructive distributions are determined. Gain or Loss on Sale, Taxable Exchange or Other Taxable Disposition of Class A Common Stock and Warrants Upon a sale or other taxable disposition of our shares of Class A common stock or warrants (which, in general, would include redemption of Class A common stock or warrants that is treated as a sale of such securities as below, and including on our dissolution and liquidation if we do not consummate an initial business combination within 15 months (or up to 21 months, if we extend the period of time to complete our initial business combination, as described herein) from the closing of this offering), a U.S. Holder generally will recognize capital gain or loss in an amount equal to the difference between the amount realized and the U.S. Holder s adjusted tax basis in the Class A common stock or warrants. Any such capital gain or loss generally will be long-term capital gain or loss if the U.S. Holder s holding period for such Class A common stock or warrants exceeds one year. However, it is unclear whether certain redemption rights described in this prospectus may suspend the running of the applicable holding period of the Class A common stock for this purpose during the period in which the U.S. Holder has redemption rights with respect to the Class A common stock (i.e., the period prior to the consummation of our initial business combination). If the holding period for the Class A common stock is suspended during such period, then any gain that a U.S. Holder recognizes upon a sale or other taxable disposition of the Class A common stock prior to the date that is one year and one day after the expiration of a holder s redemption right would not be treated as long-term capital gain. Long-term capital gains recognized by non-corporate U.S. holders will be eligible to be taxed at reduced rates. The deductibility of capital losses is subject to limitations. Generally, the amount of gain or loss recognized on a sale or other taxable disposition generally will be equal to the difference between (1) the sum of the amount of cash and the fair market value of any property received in such disposition (or, if the shares of Class A common stock or warrants are held as part of units at the time of the disposition, the portion of the amount realized on such disposition that is allocated to the shares of Class A common stock or warrants based upon the then fair market values of the shares of Class A common stock and the warrants included in the units) and (2) the U.S. Holder s adjusted tax basis in its shares of Class A common stock or warrants so disposed of. A U.S. Holder s adjusted tax basis in its shares of Class A common stock or warrants generally will equal the U.S. Holder s acquisition cost (that is, the portion of the purchase price of a unit allocated to a share of Class A common stock or one-half of one warrant, as described above under "— Allocation of Purchase Price and Characterization of a Unit") reduced, in the case of a Class A common stock, by any prior distributions treated as a return of capital. Long-term capital gains realized by non-corporate U.S. Holders may be taxed at reduced rates of taxation. See "— Exercise, Lapse or Redemption of a Warrant" below for a discussion regarding a U.S. Holder s basis in the shares of Class A common stock acquired pursuant to the exercise of a warrant. The deduction of capital losses is subject to certain limitations. 151 Redemption of Shares of Class A Common Stock In the event that a U.S. Holder s shares of Class A common stock are redeemed pursuant to the redemption provisions described in this prospectus under "Description of Securities — Common Stock" or if we purchase a U.S. Holder s shares of Class A common stock in an open market transaction, the treatment of the transaction for U.S. federal income tax purposes will depend on whether the redemption or purchase by us qualifies as a sale of the shares of Class A common stock under Section 302 of the Code. If the redemption or purchase by us qualifies as a sale of shares of Class A common stock, the U.S. Holder will be treated as described under "— Gain or Loss on Sale, Taxable Exchange or Other Taxable Disposition of Shares of Class A Common Stock and Warrants" above. If the redemption or purchase by us does not qualify as a sale of shares of Class A common stock, the U.S. Holder will be treated as receiving a corporate distribution with the tax consequences described above under "— Taxation of Distributions." Whether a redemption or purchase by us qualifies for sale treatment will depend largely on the total number of our shares treated as held by such U.S. Holder (including any shares constructively owned by the U.S. Holder described in the following paragraph, including as a result of owning warrants) relative to all of our shares outstanding both before and after such redemption or purchase. A redemption or purchase by us of shares of Class A common stock generally will be treated as a sale of the shares of Class A common stock (rather than as a corporate distribution) if such redemption or purchase (1) is "substantially disproportionate" with respect to a U.S. Holder, (2) results in a "complete termination" of such U.S. Holder s interest in us or (3) is "not essentially equivalent to a dividend" with respect to the U.S. Holder. These tests are explained more fully below. In determining whether any of the foregoing tests are satisfied, a U.S. Holder must take into account not only our shares actually owned by the U.S. Holder, but also our shares that are constructively owned by such holder. A U.S. Holder may constructively own, in addition to shares owned directly, shares owned by related individuals and entities in which the U.S. Holder has an interest or that have an interest in such U.S. Holder, as well as any shares the U.S. Holder has a right to acquire by exercise of an option, which generally include shares of Class A common stock which could be acquired by such U.S. Holder pursuant to the exercise of the warrants. In order to meet the substantially disproportionate test, the percentage of our issued and outstanding voting shares actually and constructively owned by a U.S. Holder immediately following the redemption or purchase by us of shares of Class A common stock must, among other requirements, be less than 80% of the percentage of our issued and outstanding voting and common stock actually and constructively owned by the U.S. Holder immediately before the redemption or purchase by us. Prior to our initial business combination, the shares of Class A common stock may not be treated as voting shares for this purpose and, consequently, this substantially disproportionate test may not be applicable. There will be a complete termination of a U.S. Holder s interest if either (1) all of our shares actually and constructively owned by such U.S. Holder are redeemed or (2) all of our shares actually owned by such U.S. Holder are redeemed and such holder is eligible to waive, and effectively waives, in accordance with specific rules, the attribution of shares owned by family members and the U.S. Holder does not constructively own any other shares of ours. The redemption or purchase by us of the shares of Class A common stock will not be essentially equivalent to a dividend if such redemption results in a "meaningful reduction" of a U.S. Holder s proportionate interest in us. Whether the redemption will result in a meaningful reduction in a U.S. Holder s proportionate interest in us will depend on the particular facts and circumstances. However, the IRS has indicated in a published ruling that even a small reduction in the proportionate interest of a small minority stockholder in a publicly held corporation who exercises no control over corporate affairs may constitute such a "meaningful reduction." U.S. Holders should consult with their own tax advisors as to the tax consequences of a redemption or purchase by us of any shares of Class A common stock. If none of the foregoing tests are satisfied, then the redemption or purchase by us will be treated as a corporate distribution and the tax effects will be as described under "— Taxation of Distributions" above. After the application of those rules, any remaining tax basis of the U.S. Holder in the redeemed shares of Class A common stock will be added to the adjusted tax basis in such U.S. Holder s remaining shares, or, if it has none, to the U.S. Holder s adjusted tax basis in its warrants or possibly in other shares constructively owned by it. U.S. holders who actually or constructively own five percent (or, if our shares of Class A common stock are not then publicly traded, one percent) or more of our shares (by vote or value) may be subject to special reporting requirements with respect to a redemption of shares of Class A common stock, and such holders are urged to consult with their own tax advisors with respect to their reporting requirements. 152 Exercise, Lapse or Redemption of a Warrant Except as discussed below with respect to the cashless exercise of a warrant, a U.S. Holder generally will not recognize gain or loss upon the acquisition of a share of Class A common stock on the exercise of a warrant for cash. A U.S. Holder s tax basis in a share of Class A common stock received upon exercise of the warrant generally will equal the sum of the U.S. Holder s initial investment in the warrant (that is, the portion of the U.S. Holder s purchase price for the units that is allocated to the warrant, as described above under "— Allocation of Purchase Price and Characterization of a Unit") and the exercise price. It is unclear whether a U.S. Holder s holding period for the share of Class A common stock received will commence on the date of exercise of the warrant or the day following the date of exercise of the warrant; in either case, the holding period will not include the period during which the U.S. Holder held the warrant. If a warrant is allowed to lapse unexercised, a U.S. Holder generally will recognize a capital loss equal to such holder s tax basis in the warrant. The tax consequences of a cashless exercise of a warrant are not clear under current U.S. federal income tax law. A cashless exercise may not be taxable, either because the exercise is not a realization event or because the exercise is treated as a recapitalization for U.S. federal income tax purposes. In either situation, a U.S. Holder s tax basis in the share of Class A common stock received generally should equal the U.S. Holder s tax basis in the warrants. If the cashless exercise was not a realization event, it is unclear whether a U.S. Holder s holding period for the share of Class A common stock would be treated as commencing on the date of exercise of the warrant or the day following the date of exercise of the warrant; in either case, the holding period of such Class A common stock will not include the period during which the U.S. Holder held the warrant. If the cashless exercise were treated as a recapitalization, the holding period of the shares of Class A common stock would include the holding period of the warrants. It is also possible that a cashless exercise may be treated as a taxable exchange in which gain or loss would be recognized. In such event, a U.S. Holder could be deemed to have surrendered warrants with an aggregate fair market value equal to the exercise price for the total number of warrants to be exercised. The U.S. Holder would recognize capital gain or loss in an amount equal to the difference between the fair market value of the warrants deemed surrendered and the U.S. Holder s tax basis in such warrants. In this case, a U.S. Holder s tax basis in the share of Class A common stock received would equal their fair market value on the date of receipt. It is unclear whether a U.S. Holder s holding period for the share of Class A common stock would commence on the date of exercise of the warrant or the day following the date of exercise of the warrant; in either case, the holding period will not include the period during which the U.S. Holder held the warrant. Due to the absence of authority on the U.S. federal income tax treatment of a cashless exercise, including when a U.S. Holder s holding period would commence with respect to the share of Class A common stock received, there can be no assurance which, if any, of the alternative tax consequences and holding periods described above would be adopted by the IRS or a court of law. Accordingly, U.S. Holders should consult their tax advisors regarding the tax consequences of a cashless exercise. If we redeem warrants for cash pursuant to the redemption provisions described in the section of this prospectus entitled " Description of Securities — Redeemable Warrants — Public Stockholders Warrants — Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00" or the section of this prospectus entitled "— Redemption of warrants when the price per share of Class A common stock equals or exceeds $10.00" or if we purchase warrants in an open market transaction, such redemption or purchase generally will be treated as a taxable disposition to the U.S. Holder, taxed as described above under "— Gain or Loss on Sale, Taxable Exchange or Other Taxable Disposition of Shares of Class A Common Stock and Warrants." Non-U.S. Holders This section applies to you if you are a "Non-U.S. Holder." As used herein, the term "Non-U.S. Holder" means a beneficial owner of our units, Class A common stock or warrants that is for U.S. federal income tax purposes: a non-resident alien individual (other than certain former citizens and residents of the United States subject to U.S. tax as expatriates); a foreign corporation; or an estate or trust that is not a U.S. Holder; 153 but generally does not include an individual who is present in the United States for 183 days or more in the taxable year of disposition. If you are such an individual, you should consult your tax advisor regarding the U.S. federal income tax consequences of the sale or other disposition of our securities. In general, any distributions we make to a Non-U.S. Holder of shares of our Class A common stock, to the extent paid out of our current or accumulated earnings and profits (as determined under U.S. federal income tax principles), will constitute dividends for U.S. federal income tax purposes and, provided such dividends are not effectively connected with the Non-U.S. Holder s conduct of a trade or business within the United States, we or the applicable withholding agent will be required to withhold tax from the gross amount of the dividend at a rate of 30%, unless such Non-U.S. Holder is eligible for a reduced rate of withholding tax under an applicable income tax treaty and provides proper certification of its eligibility for such reduced rate (usually on an IRS Form W-8BEN or W-8BEN-E). Any distribution not constituting a dividend will be treated first as reducing (but not below zero) the Non-U.S. Holder s adjusted tax basis in its shares of our Class A common stock and, to the extent such distribution exceeds the Non-U.S. Holder s adjusted tax basis, as gain realized from the sale or other disposition of the Class A common stock, which will be treated as described below. In addition, if we or the applicable withholding agent determine that we are likely to be classified as a "U.S. real property holding corporation" (see "Non-U.S. Holders — Gain on Sale, Taxable Exchange or Other Taxable Disposition of Class A Common Stock and Warrants" below), we or the applicable withholding agent will withhold 15% of any distribution that exceeds our current and accumulated earnings and profits. In addition, a Non-U.S. holder generally will not be subject to U.S. federal income tax on any gain attributable to a sale or other disposition of our Class A common stock or warrants (including a redemption or cashless exercise of warrants to the extent such disposition may otherwise be treated as taxable) unless such gain is effectively connected with its conduct of a trade or business in the United States (and, if required by an applicable income tax treaty, is attributable to a permanent establishment or fixed base that such holder maintains in the United States) or the Non-U.S. Holder is an individual who is present in the United States for 183 days or more in the taxable year of sale or other disposition and certain other conditions are met (in which case, such gain from United States sources generally is subject to tax at a 30% rate or a lower applicable tax treaty rate). Dividends (including constructive distributions) and gains that are effectively connected with the Non-U.S. Holder s conduct of a trade or business in the United States (and, if required by an applicable income tax treaty, are attributable to a permanent establishment or fixed base in the United States) generally will be subject to U.S. federal income tax at the same regular U.S. federal income tax rates applicable to a comparable U.S. Holder and, in the case of a Non-U.S. Holder that is a corporation for U.S. federal income tax purposes, also may be subject to an additional branch profits tax at a 30% rate or a lower applicable tax treaty rate. The U.S. federal income tax treatment of a Non-U.S. Holder s receipt of any Class A common stock upon the exercise of a warrant, or the lapse of a warrant, held by a Non-U.S. Holder generally will correspond to the U.S. federal income tax treatment of the receipt of a Class A share on exercise or lapse of a warrant by a U.S. Holder, as described under "— U.S. Holders — Exercise, Lapse or Redemption of a Warrant," above, although to the extent a cashless exercise results in a taxable exchange, the consequences would be similar to those described in the preceding paragraphs above for a Non-U.S. Holder s gain on the sale or other disposition of our securities. FATCA Withholding Taxes Sections 1471 through 1474 of the Code and Treasury Regulations and administrative guidance promulgated thereunder (commonly referred as the "Foreign Account Tax Compliance Act" or "FATCA") generally impose withholding at rate 30% in certain circumstances on dividends in respect of our securities which are held by or through certain foreign financial institutions (including investment funds), unless any such institution (1) enters into, and complies with, an agreement with the IRS to report, on an annual basis, information with respect to interests in, and accounts maintained by, the institution that are owned by certain U.S. persons and by certain non-U.S. entities that are wholly or partially owned by U.S. persons and to withhold on certain payments, or (2) if required under an intergovernmental agreement between the United States and an applicable foreign country, reports such information to its local tax authority, which will exchange such information with the U.S. authorities. An intergovernmental agreement between the United States and an applicable foreign country may modify these requirements. Accordingly, the entity through which our securities are held will affect the determination of whether such withholding is required. Similarly, dividends in respect of our securities held by an investor that is a non-financial 154 non-U.S. entity that does not qualify under certain exceptions will generally be subject to withholding at a rate of 30%, unless such entity either (1) certifies to us or the applicable withholding agent that such entity does not have any "substantial United States owners" or (2) provides certain information regarding the entity s "substantial United States owners," which will in turn be provided to the U.S. Department of Treasury. All prospective investors should consult their tax advisors regarding the possible implications of FATCA on their investment in our securities. Thirty percent withholding under FATCA was scheduled to apply to payments of gross proceeds from the sale or other disposition of property that produces U.S.-source interest or dividends beginning on January 1, 2019, but on December 13, 2018, the IRS released proposed regulation (which taxpayers may rely on) that, if finalized in their proposed form, would eliminate the obligation to withhold on gross proceeds. Such proposed regulations also delayed withholding on certain other payments received from other foreign financial institutions that allocable, as provided for under final Treasury Regulations, to payments of U.S.-source dividends, and other fixed or determinable annual or periodical income. Information Reporting and Backup Withholding Dividend payments with respect to our Class A common stock and the proceeds from a sale, exchange, redemption or other disposition of our units, shares of Class A common stock and warrants may be subject to information reporting to the IRS and possible United States backup withholding. However, backup withholding will not apply to a U.S. Holder who furnishes a correct taxpayer identification number and makes other required certifications, or who is otherwise exempt from backup withholding and establishes such exempt status. A Non-U.S. Holder generally will eliminate the requirement for information reporting and backup withholding by providing certification of its foreign status, under penalties of perjury, on a duly executed applicable IRS Form W-8 or by otherwise establishing an exemption. Backup withholding is not an additional tax. Amounts withheld as backup withholding may be credited against a holder s U.S. federal income tax liability, and a holder generally may obtain a refund of any excess amounts withheld under the backup withholding rules by timely filing the appropriate claim for refund with the IRS and furnishing any required information. U.S. Holders and Non-U.S. Holders are urged to consult their own tax advisors regarding the application of backup withholding and the availability of and procedure for obtaining an exemption from backup withholding in their particular circumstances, including the tax consequences under state, local, estate, foreign and other tax laws and tax treaties and the possible effects of changes in U.S. or other tax laws 155 UNDERWRITING William Blair is acting as the sole book-running manager of the offering. Subject to the terms and conditions set forth in the underwriting agreement between us and William Blair, we have agreed to sell to William Blair, and William Blair has agreed to purchase from us, 17,500,000 units. The underwriting agreement provides that the obligations of the underwriter are subject to certain conditions precedent such as the receipt by the underwriter of officers certificates and legal opinions and approval of certain legal matters by its counsel. The underwriting agreement provides that the underwriter will purchase all of the units if any of them are purchased. We have agreed to indemnify the underwriter and certain of its controlling persons against certain liabilities, including liabilities under the Securities Act, and to contribute to payments that the underwriter may be required to make in respect of those liabilities. The underwriter has advised us that, following the completion of this offering, it currently intends to make a market in the units as permitted by applicable laws and regulations. However, the underwriter is not obligated to do so, and the underwriter may discontinue any market-making activities at any time without notice in its sole discretion. Accordingly, no assurance can be given as to the liquidity of the trading market for the units, that you will be able to sell any of the units held by you at a particular time or that the prices that you receive when you sell will be favorable. The underwriter is offering the units subject to its acceptance of the units from us and subject to prior sale. The underwriter reserves the right to withdraw, cancel or modify offers to the public and to reject orders in whole or in part. In addition, the underwriter has advised us that it does not intend to confirm sales to any account over which they exercise discretionary authority. Commission and Expenses The underwriter has advised us that it proposes to offer the units to the public at the initial public offering price set forth on the cover page of this prospectus and to certain dealers, which may include the underwriter, at that price less a concession not in excess of $ per unit. The underwriter may allow, and certain dealers may re-allow, a discount from the concession not in excess of $ per unit to certain brokers and dealers. After the offering, the initial public offering price, concession and reallowance to dealers may be reduced by the underwriter. No such reduction will change the amount of proceeds to be received by us as set forth on the cover page of this prospectus. The following table shows the public offering price, the underwriting discounts and commissions that we are to pay the underwriter and the proceeds, before expenses, to us in connection with this offering. Such amounts are shown assuming both no exercise and full exercise of the underwriter s option to purchase additional units. Paid by First Digital Health Acquisition Corp. No Exercise Full Exercise Per Unit(1) $ 0.55 $ 0.55 Total(1) $ 9,625,000 $ 11,068,750 ____________ (1) $0.20 per unit, or $3,500,000 in the aggregate (or $4,025,000 in the aggregate if the underwriters option to purchase additional units is exercised in full), is payable upon the closing of this offering. $0.35 per unit, or $6,125,000 in the aggregate (or $7,043,750 in the aggregate if the underwriter s option to purchase additional units is exercised in full) payable to the underwriters for deferred underwriting commissions will be placed in a trust account located in the United States as described herein. The deferred commissions will be released to the underwriter only on and concurrently with completion of an initial business combination. If we do not complete our initial business combination and subsequently liquidate, the underwriter has agreed that it will forfeit any rights or claims to its deferred underwriting discounts and commissions, including any accrued interest thereon, then in the trust account and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public units. We estimate expenses payable by us in connection with this offering, other than the underwriting discounts and commissions referred to above, will be approximately $750,000. We have agreed to reimburse the underwriter for FINRA-related fees and expenses, not to exceed $25,000, and for background check expenses, not to exceed $35,000. 156 Determination of Offering Price Prior to this offering, there has not been a public market for our units. Consequently, the initial public offering price for our units was determined by negotiations between us and the underwriter. Among the factors considered in these negotiations were the history and prospects of companies whose principal business is the acquisition of other companies, prior offerings of those companies, our management, our capital structure, and currently prevailing general conditions in equity securities markets, including current market valuations of publicly traded companies considered comparable to our company. We offer no assurances that the initial public offering price will correspond to the price at which the units will trade in the public market
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: common stock are to our common stock, par value $0.00001 per share; founder shares or sponsor shares are to 3,162,500 shares of our common stock initially purchased by our sponsor in a private placement in connection with our formation, of which up to 412,500 shares are subject to forfeiture if the over-allotment is not exercised in full; initial stockholders are to our sponsor and any other holders of our founder shares prior to this offering (or their permitted transferees); EF Hutton are to EF Hutton, division of Benchmark Investments, LLC, the representative of the underwriters in this offering; management or our management team are to our officers and directors; private placement are to the private placement of 587,500 units being purchased by our sponsor (649,375 if the over-allotment option is exercised in full) which will occur simultaneously with the completion of this offering at a purchase price of $10.00 per unit for a total purchase price of $5,875,000 (or $6,493,750 if the over-allotment option is exercised in full); private placement units are to the units being purchased separately by our sponsor in the private placement, as well as units issued upon conversion of working capital loans, each private placement unit consisting of one private placement share and one private placement warrant; private placement shares are to the shares of our common stock included within the private placement units; private placement warrants are to the warrants included within the private placement units; public shares are to shares of our common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder s and member of our management team s status as a public stockholder shall only exist with respect to such public shares; public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); representative s shares are to the 284,625 shares of common stock we will issue to the representative of the underwriters and/or its designees (including up to 37,125 shares subject to forfeiture if the over-allotment option is not exercised in full) as underwriter compensation in connection with this offering; sponsor are to Toprun Smart Management LLC, a Delaware limited liability company controlled by certain of our officers, directors and advisors; warrants are to our public warrants as well as the private placement warrants; and we, us, company or our company are to Zi Toprun Acquisition Corp., a Delaware corporation. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option and our sponsor will forfeit 412,500 founder shares and the representative will forfeit 37,125 representative shares. Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED SEPTEMBER 21, 2022 $110,000,000 ZI TOPRUN ACQUISITION CORP. 11,000,000 Units Zi Toprun Acquisition Corp. is a Delaware blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target regarding a business combination with our company. Although our efforts to identify a target business will not be limited to any particular industry or geographic region, we intend to pursue prospective targets that are in North America, Europe and Asia (except as described below). This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one share of our common stock and one redeemable warrant. Each warrant entitles the holder thereof to purchase one share of our common stock at a price of $11.50 per share, subject to adjustment as described herein. The warrants will become exercisable on the later of one year from the closing of this offering and 30 days after the completion of our initial business combination, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. The underwriters have a 45-day option from the date of this prospectus to purchase up to an additional 1,650,000 units to cover over-allotments, if any. We will provide our public stockholders with the opportunity to redeem all or a portion of their shares of our common stock upon the completion of our initial business combination, subject to the limitations described herein. If we are unable to complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time for six extension periods of one month each, as described below), we will redeem 100% of the public shares for cash, equal to the aggregate amount then on deposit in the trust account, including interest (net of taxes payable) divided by the number of then issued and outstanding public shares of common stock, subject to applicable law and as further described herein. Our sponsor may extend the time frame for the Company to complete a business combination from 12 months by up to an additional six months comprised of six one-month extensions on the terms described herein. Holders of our securities will not have the right to approve or disapprove any such extensions. Further, holders of our securities will not have the right to seek or obtain redemption in connection with any such extension. Our sponsor and a majority of our Board of Directors and management team have significant business ties to the People s Republic of China, including Hong Kong. Additionally, two of our officers and one of our independent director candidates reside in China (while our other officers and directors are residents of the United States). However, we have determined that because of uncertainties in the regulatory climate in China, and the potential for future governmental actions which might unfavorably impede future operations, we will not consider or undertake a business combination with an entity or business that is based in, or has its principal business operations in, the People s Republic of China, including Hong Kong and Macau. Since many of our officers and directors have business experience in China and three of such members reside in China, not being able to target a business in the People s Republic of China (including Hong Kong and Macau) may make it more difficult for us to find an attractive target business outside of China, and it may make us a less attractive partner to target businesses outside of the People s Republic of China, Hong Kong or Macau. Because our executive office is located in the United States, we will not acquire a business in China, we currently do not operate in China, and several of our officers and directors reside and/or work outside of China, we do not believe we are currently subject to any Chinese regulations, such as those published by the China Securities Regulatory Commission or Cyberspace Administration of China. However, the relationships of our officers and directors to the People s Republic of China could influence the types of targets that they select to acquire due to changes in laws or regulations in China, which could make it more difficult for us to consummate an initial business combination. Pursuant to the Holding Foreign Companies Accountable Act ( HFCAA ), the Public Company Accounting Oversight Board (the PCAOB ) issued a Determination Report on December 16, 2021 which found that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in: (1) mainland China of the People s Republic of China because of a position taken by one or more authorities in mainland China; and (2) Hong Kong, a Special Administrative Region and dependency of the PRC, because of a position taken by one or more authorities in Hong Kong. In addition, the PCAOB s report identified the specific registered public accounting firms which are subject to these determinations. On August 26, 2022, the PCAOB signed a Statement of Protocol with the China Securities Regulatory Commission and the Ministry of Finance of PRC ( SOP ), taking the first step toward opening access for the PCAOB to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong. Our registered public accounting firm, Marcum Asia CPAs LLP (formerly known as Marcum Bernstein & Pinchuk LLP), is a United States accounting firm headquartered in New York, New York, is an independent registered public accounting firm with the PCAOB and has been inspected by the PCAOB on a regular basis. Marcum Asia CPAs LLP (formerly known as Marcum Bernstein & Pinchuk LLP) is not headquartered in mainland China or Hong Kong and was not identified in the Determination Report as a firm subject to the PCAOB s determinations. However, if we engage auditors in the future that are unable to be inspected by the PCAOB, trading in our securities on the U.S. stock exchanges or in the over the counter trading market in the U.S. could be stopped or our securities could be delisted from any national exchange on which such securities are traded. Our sponsor, Toprun Smart Management LLC, has committed to purchase an aggregate of 587,500 private placement units (649,375 private placement units if the over-allotment option is exercised in full) at a price of $10.00 per unit, for an aggregate purchase price of $5,875,000 (or $6,493,750 if the over-allotment option is exercised in full). Each private placement unit will be identical to the units sold in this offering, except as described in this prospectus. This purchase will take place on a private placement basis simultaneously with the consummation of this offering. As of the date of this prospectus, our initial stockholders, which includes our sponsor, own an aggregate of 3,162,500 shares of common stock, which were acquired for a purchase price of $25,000. Prior to this offering, there has been no public market for our units, common stock or warrants. We intend to apply to list our units on The Nasdaq Global Market, or Nasdaq, under the symbol ZTOPU . We expect that our units will be listed on Nasdaq on or promptly after the effective date of the registration statement of which this prospectus forma a part. We cannot guarantee that our securities will be approved for listing on Nasdaq. We expect the common stock and warrants comprising the units will not begin separate trading until 52 days following the date of this prospectus unless EF Hutton, division of Benchmark Investments, LLC, the representative of the underwriters, informs us of its decision to allow earlier separate trading, subject to our satisfaction of certain conditions. Once the securities comprising the units begin separate trading, we expect that the common stock and warrants will be listed on Nasdaq under the symbols ZTOP and ZTOPW, respectively. We cannot assure you that our securities will be listed on Nasdaq at the time of this offering or continue to be listed thereafter prior to an initial business combination. We are an emerging growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 36 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the U.S. Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 110,000,000 Underwriting discounts and commissions(1) $ 0.45 $ 4,950,000 Proceeds, before expenses, to us $ 9.55 $ 105,050,000 (1) Includes $0.20 per unit, or $2,200,000 (or $2,530,000 if the over-allotment option is exercised in full) in the aggregate, payable to the undewriters upon the closing of this offering. Also includes $0.25 per unit, or $2,750,000 (or up to $3,162,500 if the underwriters over-allotment option is exercised in full) in the aggregate payable to EF Hutton for deferred underwriting commissions which will be placed in a trust account located in the United States as described herein. The deferred commissions will be released to EF Hutton only upon completion of an initial business combination, as described in this prospectus. We will also issue to the representative of the underwriters and/or its designees 284,625 shares of common stock (including up to 37,125 shares that are subject to forfeiture if the over-allotment option is not exercised in full), which we refer to herein as the representative s shares as underwriter compensation in connection with this offering. Does not include certain other fees and expenses payable to the underwriters in connection with this offering. See the section of this prospectus entitled Underwriting for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement units described in this prospectus, $113,300,000 or $130,295,000 if the underwriters over-allotment option is exercised in full ($10.30 per unit in either case) will be initially deposited into a trust account in the United States at J.P. Morgan Chase Bank, N.A., with Continental Stock Transfer & Trust Company acting as trustee. Except as described in this prospectus, these funds will not be released to us until the earlier of the completion of an initial business combination and our redemption of our public shares. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about [ ], 2022. Sole Book-Running Manager EF Hutton division of Benchmark Investments, LLC The date of this prospectus is [ ], 2022 Table of Contents Our Company Overview We are a Delaware blank check company incorporated on April 9, 2021 for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target regarding a business combination with our company. Although our efforts to identify a target business will not be limited to any particular industry or geographic region, we intend to pursue prospective targets that are in North America, Europe and Asia. However, we have determined that because of uncertainties in the regulatory climate in this jurisdiction, and the potential for future governmental actions which might unfavorably impede future operations, we will not consider or undertake a business combination with an entity or business that is based in, or has its principal business operations in, the People s Republic of China, including Hong Kong and Macau. Our sponsor and a majority of our Board of Directors and management team members have significant business ties to the People s Republic of China, including Hong Kong. Additionally, two of our officers and one of our independent director candidates reside in China (while our other officers and directors are residents of the United States), Since many of our officers and directors have business experience in China and three of them reside in China, not being able to target a business in China may make it more difficult to find an attractive target business outside of China, and it may make us a less attractive partner to non-Hong Kong and non-People s Republic of China targets. Because (i) we are a Delaware company and not a PRC company, (ii) our offices are in the United States, (iii) we will not acquire a business in China, (iv) we currently do not operate in China and (v) several of our officers and directors reside outside of China, we do not believe we are currently subject to Chinese regulations, such as those published by the China Securities Regulatory Commission or Cyberspace Administration of China and we do not believe we are required to obtain permission from any governmental authorities in China for our offering. Moreover, our officers and directors have advised us that they are not covered by any Chinese permissions requirements. Accordingly, as of the date of this prospectus, we have not applied or received any permission or approvals for this offering. However, we and our officers and directors could be incorrect in such assessment and there can be no assurance that the relevant governmental authorities in China, including the CSRC, would reach the same conclusion as us, or that the CSRC or any other governmental authorities in China would not promulgate new rules or new interpretations of current rules which would require us to obtain CSRC or other Chinese governmental approvals for this offering. Further, as a majority of our directors and officers have significant ties to China (including Hong Kong and Macau), we may be subject to certain risks relating to regulatory oversight by the PRC government. In particular, changes in the policies, regulations, rules, and the enforcement of laws of the PRC government may be adopted quickly with little advance notice. The Chinese government may also intervene or influence our search for a target business or the completion of an initial business combination at any time because certain of our directors and officers have significant ties to China. If applicable laws, regulations, or interpretations change or if we learn we mistakenly did not obtain any necessary approval thereby requiring us and/or our directors and officers to obtain such permissions or approvals in the future, these regulatory authorities (a) may impose fines and penalties on us and our officers and directors and (b) may also take actions requiring our directors and officers, or making it advisable for directors and officers, to terminate this offering before settlement and delivery of our units, change our search for a target business or delay our potential business combination and in such situations, we may have to liquidate the funds held in the trust account (in which case our warrants may be worthless). Similarly, if the CSRC or another governmental authority in China subsequently determines that its approval is Table of Contents needed for this offering, we may face approval delays, adverse actions or sanctions by the CSRC or other Chinese governmental authorities. Further, complying with the requirements of the above-mentioned regulations and other relevant rules and any required approval processes with governmental authorities in China could be time-consuming and may delay this offering or a potential business combination. Any uncertainties and/or negative publicity regarding such an approval requirement could have a material adverse effect on the trading price of our securities or render them worthless. Further, the relationships of our officers and directors to China could influence the types of targets that they select to acquire due to changes in laws or regulations in China, which could make it more difficult for us to consummate an initial business combination. See Risk Factor The Chinese government may intervene or influence our operations at any time, which could result in a material change in our search for a target business and/or the value of the securities we are registering. Changes in the policies, regulations, rules, and the enforcement of laws of the PRC government may be adopted quickly with little advance notice and could have a significant impact upon our ability to operate. No Chinese legal counsel has been retained for purpose of this offering and consequently we did not rely on the advice of such counsel. The above discussion is based on our management s understanding of the current Chinese laws, rules, regulations and local market practices and we cannot assure you that our management s understanding is correct. We have been closely monitoring regulatory developments in China regarding any necessary approvals from the CSRC or other governmental authorities required for overseas listings, including this offering. As of the date of this prospectus, we have not received any inquiry, notice, warning, sanctions or regulatory objection to this offering from the CSRC or other Chinese governmental authorities. We intend to focus our search for a target business in the transportation industry, including businesses involving (i) battery or charging businesses, technology and software, (ii) auto pilot drive and Advanced Driver Assistance Systems (ADAS) related businesses including both hardware and software, and (iii) general microchip design and production and technology. While we may pursue an initial business combination target at any stage of its corporate evolution, we intend to focus our search on companies or businesses with a valuation of between $200 million and $600 million and which we believe have favorable long-term growth prospects, durable competitive advantages and the potential to earn sustainably high returns on invested capital, as further described in the section titled Acquisition Criteria. Management Team Our management team is comprised of Mr. Yatao Pang, Mr. Yaojun Liu, Mr. Tao Huang, Mr. Richard Yu Chen, Ms. Shan Cui, Dr. Haiqing Lin and Mr. Xiaochuan Duan. Each of our executive team members has distinctive and complementary experience and extensive networks in our target industries. Our independent directors are experienced in financial, accounting, technology and related areas, which we believe will provide us with appropriate corporate governance and oversight functions. We believe that our management team is well positioned to identify attractive business combination opportunities with compelling characteristics and potential. Members of our management team have extensive experience in executing business combinations, having been long-term legal and financial advisors to buyers and sellers in mergers and acquisitions, private equity investors, fund managers, and buy and sell-side investment bankers. Mr. Yatao Pang, Chairman of our Board of Directors, is a veteran investment manager in Asia. He has 15 years of broad experience in the financial industry, specializing in capital markets, private equity and venture capital investment. Mr. Pang has been involved in advising, managing and investing capital in many projects for international corporations and investors, and has participated in building successful funds and asset management platforms. In 2016, he founded Zhongi Fund Management Co., Ltd., a Beijing-based private fund management and consulting firm of which he is currently Managing Partner. As Managing Partner of Zhongi Fund Table of Contents Management Co., Ltd., Mr. Pang led his team to complete the acquisitions of Suzhou Zhihua Automotive Electronics Co., Ltd, the Chinese leading provider of ADAS ( Advanced Driving Assistance System ) solutions in June 2021; Nexperia, the Standard Products business unit of NXP Semiconductors N.V. in February 2017; and MFLEX, a global provider of high-quality, technologically advanced flexible printed circuits and assemblies to the consumer electronics industry in July 2016. Each of these enterprises are EV, ADAS or IC design or production related companies. From 2009 to 2016, Mr. Pang was a Managing Director at Silver Rock Capital, a Shanghai-based private investment firm. In November 2015, Mr. Pang led his team at Silver Rock Capital to acquire Ampleon, a leading semiconductor provider specializing in high-performance RF power amplifiers. From 2007 to 2009, Mr. Pang was a Business Director at HSBC China Shenzhen office. Mr. Pang received a bachelor s degree in finance from Fudan University. Mr. Yaojun Liu, our Chief Executive Officer and member of Board of Directors, has 21 years of professional experience. He is an experienced investor and financial and legal advisor in mergers and acquisitions, real estate investment and management, Chinese foreign direct investment, and capital markets. He has invested in start-ups and growing companies in China and US, some of which have already been successfully listed in HK, China and US. Since 2014, Mr. Liu has served as the managing partner of TA Partners, LLC, a real estate development company he co-founded which owns more than 1,000 apartments under development in southern California. Prior to co-founding TA Partners, LLC, Mr. Liu was a partner at Global Law Office in Beijing, China from March 2006 to December 2014, specializing in corporate law, mergers and acquisitions and capital markets. He was a senior associate at Jingtian & Gongcheng Law Office from 2003 to 2006, and worked at Haitong Securities Co., Ltd, a leading investment banking company in China, as project manager from 2000 to 2002. He has also invested in several auto-drive and ADAS related companies, such as Suzhou Zhihua Automobile Electronics Co., Ltd, a leading ADAS provider in visual control system. Mr. Liu received a master s degree in economics and law and bachelor s degree in history from Renmin University of China. Mr. Tao Huang, our Chief Economist, served as Executive Director of Century Golden Resources Group from September 1999 to December 2012 and has been serving as President of Century Golden since December 2012. Century Golden is a renowned real estate developer in mainland China. Century Golden manages several large-scale residential projects, shopping malls, tourism destinations and hotel properties across China. Under Mr. Huang s leadership, Century Golden has expanded into businesses in education, healthcare services and advanced manufacturing. Mr. Huang and family members collectively also placed second on the 17th China Charitarian List with more than 403 million RMB donated during 2019. Mr. Huang currently serves as a board member and/or holds managerial positions with a number of privately-held entities operating in the People s Republic of China, including entities affiliated with Century Golden Resources Group and other entities that are independent of any such affiliation. Mr. Huang also serves as council member or board member for several university foundations including Tsinghua University (Hong Kong) Education Foundation Ltd., Renmin University of China Education Foundation and Peking University Education Foundation of China. Mr. Huang received a Bachelor in Business Administration from Xiamen University. Mr. Huang has also led investments as a private investor or through an independent firm in several auto-drive and ADAS related companies, such as UISEE Technology, a company providing autonomous driving solutions for automobile manufacturers and focusing on Level 4 (L4) autonomous driving technology, and Suzhou Zhihua Automobile Electronics Co., Ltd, a leading ADAS provider in visual control system. Mr. Richard Yu Chen, our Chief Financial Officer, is an experienced accountant, tax advisor and auditor. Mr. Chen worked as a senior tax associate and senior tax consultant at Grant Thornton LLP from 2003 to 2008, from 2008 to 2015, Mr. Chen worked at Deloitte as Tax Manager and then Senior Tax Manager. Most recently, from 2018 to 2020, Mr. Chen worked at FQJK USA, Inc. as CFO. From 2017 to January 2020, he also was Chief Financial Officer of Fuqin Fintech Limited, an online marketplace provider. Since 2016, Mr. Chen has also worked at his own firm, CLC LLP, where he provides comprehensive business and financial advisory services to clients. He is also acting as an Independent Director and Chairman of the Audit Committee of Jiuzi Holding, Inc. Table of Contents (Nasdaq: JZXN). Mr. Chen received a bachelor s degree in business economics from the University of California, Riverside. Ms. Shan Cui, who will be an independent member of our Board of Directors and Chairwoman of Audit Committee upon consummation of this offering, has more than 25 years of professional and executive experience with multinational companies in various industries. She is a seasoned executive with expertise in capital markets and financial planning and analysis. Ms. Cui has a successful track record in driving critical transformation, M&A, deal origination, funding, improving financial performances, business process and operational efficiency. Since April 2021, Ms. Cui has served as the Chief Financial Officer of Aetius Capital Pte. Ltd, a Singapore-based investment firm. Since 2010, Ms. Cui has also served as Managing Partner of Capital First International, a financial consulting firm. She also served as Chief Financial Officer of Lizhan Environmental, then a Nasdaq listed company, from 2011 to 2013. From 2009 to 2010, she was the Manager of Planning and Analysis for Greene, Tweed & Company, a manufacturer of high-performance engineering parts and products serving aerospace, oilfield, and semi-conductor industries. Prior to that, she held positions at Seaboard Management Corporation, General Time Corporation, Peachtree Door and Windows, Dupont Textile and Interior (Invista) Elastane Enterprise and IKON Office Solutions. Ms. Cui has substantial experience as a director and audit committee member. Since February 2021, she has served as the chair of the audit committee and independent director of Venus Acquisition Corporation (Nasdaq: VELO), a special purpose acquisition company that entered into an agreement in June 2021 for its initial business combination with VIYI Algorithm Inc.; and since February 2021 she has served as an independent director of Flag Ship Acquisition Corporation, a special purpose acquisition company that recently filed a registration statement for its initial public offering. In addition, from May 2020 to June 2021, Ms. Cui served as the chair of the audit committee and as an independent director for WiMi Hologram Cloud, Inc.; from August 2020 to May 2021 she served as the chair of the audit committee and independent director of Addentax Group Corp.; from August 2018 to May 2020, she served as an independent director and chair of the audit committee and compensation committee of Fuqin Fintech Limited; and from April 2019 to October 2019, she served as an independent director of Greenland Technologies Holding Corporation (formerly Greenland Acquisition Corp.), a special purpose acquisition company that consummated an initial business combination with Zhongchai Holding (Hong Kong) Limited in October 2019. She is a frequent speaker at investment conferences and is bilingual in English and Chinese. Ms. Cui obtained her M.B.A. from Georgia State University and her bachelor s degree in International Business English from Ocean University of China. Dr. Haiqing Lin, who will be an independent member of our Board of Directors upon consummation of this offering, has over 28 years of experience in the IC design industry. Since March 2020, he has served as a member of the executive committee of GigaDevice Semiconductor, a leading micro-chip company traded on Shenzhen Stock Exchange, overseeing its corporate strategy and global operations. From 2017 to 2020, he was the Principal of XEAL Advisors. From 2018 to 2019, he was the CEO of Edokonta Inc. (Trakpoint). From 2003 to 2017, he served as the Chief Technology Officer and Chief Executive Officer of KT Micro (California), and KT Micro, Inc., which he co-founded. From 2001 to 2003, he was an Analog Manager at SolarFlare Communications, Inc. From 1998 to 2001, he was Senior Member of Technical Staff and Technical Lead at Tality Corporation. Dr. Lin has significant expertise in analog/mixed-signal ICs, digital signal processing, data converters, transceivers, imaging, audio, frequency synthesizer, wireless communications, SerDes, smart power, digital audio, security element, and smart cards. Dr. Lin has spoken at many Institute of Electrical and Electronics Engineers (IEEE) conferences and has had his articles published in numerous journals, including the International Solid-State Circuits Conference (ISSCC) and Journal of Solid-State Circuits (JSSC). Further, Dr. Lin provides industry and investment consulting services as an industry expert and a council leader through Gerson Lehrman Group (GLG) to many investment firms, including Fidelity Investments, Goldman Sachs, Oppenheimer Funds, UBS, and Alliance Capital. Dr. Lin earned a Ph.D. in E.E.C.S. from Oregon State University and received a B.S.E.E from Tsinghua University. Table of Contents Mr. Xiaochuan Duan, who will be an independent member of our Board of Directors upon consummation of this offering, has 17 years of experience in the financial industry. Since June 2015, he has been Managing Partner and Chief Executive Officer of JC Capital Management, a boutique investment banking business. Prior to that, from April 2013 to June 2015, he served as Executive Director, Investment Banking at Morgan Stanley Securities (China). Further, from July 2005 to March 2013, he was Senior Vice President, Investment Banking at CITIC Securities. Mr. Duan currently serves as a director of Double Whales Pharmaceutical and Fireworks Media and as an expert on equity investments with Insurance Asset Management Association of China. Mr. Duan received a Master of Economics in Finance from Renmin University of China and a Bachelor of Engineering in Jet Propulsion from Beihang University. Our management team will actively source targets they believe will be attractive acquisition candidates, and utilize their deal-making track record, professional relationships, and capital markets expertise to enhance the growth potential and value of a target business and provide opportunities for attractive returns to our stockholders. Members of our management team are not obligated to devote any specific number of hours to our matters but they intend to devote as much of their time as they deem necessary to our affairs until we have completed our initial business combination. The amount of time that any member of our management team will devote in any time period will vary based on whether a target business has been selected for our initial business combination and the current stage of the business combination process. Notwithstanding the foregoing, past performance of our management team or our advisors is not a guarantee either (i) that we will be able to locate a suitable candidate for our initial business combination or (ii) of success with respect to any business combination we may consummate. No member of our management team has had management experience with special purpose acquisition corporations in the past. You should not rely on the historical record of our management team s or our advisors respective performance as indicative of our future performance. Additionally, in the course of their respective careers, members of our management team have been involved in businesses and deals that were unsuccessful. Business Strategy Our strategy is to identify and complete a business combination that creates substantial long-term shareholder value. To execute our business strategy, we intend to capitalize on our management team s well-established experience identifying investment opportunities and valuing businesses by applying a private equity approach to public equity investing. In addition, we intend to utilize our management team s extensive network of industry contacts, company owners, management teams, financial intermediaries and others to identify appropriate candidates for a possible business combination. We believe our management team s reputation within the investment community will be helpful in attracting potential targets. In addition, we believe our management team s deep knowledge of public equity and debt markets, deal structures, and complex securities could provide a valuable benefit to many companies and could help attract favorable potential targets. We believe our experience investing in many types of companies in many different industries provides us with the ability to consider a larger universe of possible targets than other potential acquirers who specialize in a particular sector. Companies are frequently choosing to go public by merging with a blank check company and we believe that this trend is likely to continue. By going public this way, an operating business can (1) reduce time to market by many months, (2) reduce the time burden on management, and (3) lower transaction costs and fees. In addition, target companies can benefit from the ability to negotiate their own price as opposed to the uncertainty that goes along with IPO pricing. A potential target may be motivated to enter into a transaction for any or all of Table of Contents the following reasons: (1) a need for additional capital to pursue high-return growth opportunities, (2) a need to de-lever its balance sheet, (3) benefits provided by being a publicly traded entity, or (4) benefits provided by our management team s reputation, deep knowledge of investing and deal structures, and expertise in capital markets. We will seek a target that we believe can grow revenues and earnings, and generate free cash flow. This may include a target that can benefit from additional capital to invest in potential high-return projects such as add-on acquisitions, business development, research and development of new products, services or technologies. Once we have identified one or more targets, in order to complete a business combination at an attractive price relative to our view of risk and future potential, we intend to conduct a detailed due diligence review of such target(s) and arrange any additional financing, as needed, to consummate the business combination. We expect to acquire one or more growth businesses with a total enterprise value of between $200,000,000 and $600,000,000. We believe that there are a substantial number of potential target businesses within this valuation range that can benefit from new capital for scalable operations to yield significant revenue and earnings growth. We currently do not intend to acquire either a start-up company (a company that has not yet established commercial operations) or a company with negative cash flow. We intend to acquire a business or businesses that will benefit from being publicly traded and which can effectively utilize access to broader sources of capital and a public profile that are associated with being a publicly traded company. Upon consummating a business combination, consistent with our objective of creating long-term value for our shareholders, we intend to: Create a strong governance structure that aligns management pay with long-term shareholder interests and is consistent with our investment philosophy; Implement, together with target s leadership, an operational and financial business plan that we believe will deliver substantial long-term shareholder value; and Seek, together with the target s leadership, further strategic acquisitions, divestitures or other transactions that we believe will further enhance shareholder value. In searching for an appropriate target, we will rely primarily on our officers and their extensive network of industry contacts, including managers of hedge funds, debt funds, private equity funds, venture capital funds, CEO s of both private and public companies, bankers and other financial intermediaries. We will also rely on our board of directors and their networks for sourcing potential acquisition targets. Acquisition Criteria We have identified the following general criteria and guidelines that we believe are consistent with our objective to create long-term shareholder value, and that we believe are important in evaluating prospective target businesses. Although we intend to use these criteria and guidelines to evaluate acquisition opportunities, we reserve the right to combine with a target that meets none of these other criteria and guidelines as long as management believes the transaction s valuation is attractive relative to its risks and long-term potential shareholder returns. Identifiable and durable competitive advantage(s). Possible advantages can include but are not limited to: a low-cost provider of products or services, a business model which can limit price competition, a brand with a loyal customer base, products or services whose value is based on intellectual property such as patents, trade secrets or proprietary technology, a business with operating scale or high-market share within a well-defined market. Potential to earn a sustainably high return on equity over time. The higher a company s return on equity, the more value it can generate per dollar of investment, providing more potential for long-term shareholder value creation. Table of Contents Potential to achieve strong growth over time in revenue, earnings, and free cash flow. We believe such growth potential for a target company can be achieved as a result of either organic growth or capital deployment into high return investments. Senior management team with a long-term focus and a desire to substantially align their economic incentives with long-term shareholder interests. We believe this is a highly under-rated factor in long-term shareholder value creation. Understanding the characteristics of a particular investment and designing an appropriate plan around specific goals can greatly improve results for shareholders as well as management. Attractive valuation relative to risks and long-term potential shareholder returns. We would be willing to make a riskier investment in exchange for a significantly higher potential long-term payout. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our sponsor and management team may deem relevant. Status as a Public Company We believe our structure will make us an attractive business combination partner to target businesses. As a public company, we offer a target business and its management and shareholders an alternative to the traditional initial public offering, through a merger or other business combination. Following an initial business combination, we believe the target business would have greater access to capital and additional means of creating management incentives that are better aligned with stockholders interests than it would as a private company. A target business can further benefit by augmenting its profile among potential new customers and vendors and aid in attracting talented employees. In a business combination transaction with us, the owners of the target business may, for example, exchange their shares of stock in the target business for our shares of common stock (or shares of a new holding company) or for a combination of our shares of common stock and cash, allowing us to tailor the consideration to the specific needs of the sellers. Although there are various costs and obligations associated with being a public company, we believe target businesses will find this method a more expeditious and cost-effective method to becoming a public company than the typical initial public offering. The typical initial public offering process takes a significantly longer period of time than the typical business combination transaction process, and there are significant expenses in the initial public offering process, including underwriting discounts and commissions, marketing and road show efforts that may not be present to the same extent in connection with an initial business combination with us. Furthermore, once a proposed initial business combination is completed, the target business will have effectively become public, whereas an initial public offering is always subject to the underwriters ability to complete the offering, as well as general market conditions, which could delay or prevent the offering from occurring or could have negative valuation consequences. Following an initial business combination, we believe the target business would then have greater access to capital and an additional means of providing management incentives consistent with stockholders interests and the ability to use its shares as currency for acquisitions. Being a public company can offer further benefits by augmenting a company s profile among potential new customers and vendors and aid in attracting talented employees. While we believe that our structure and our management team s backgrounds will make us an attractive business partner, some potential target businesses may view our status as a blank check company, such as our lack of an operating history and the requirement to seek stockholder approval of any proposed initial business combination, negatively. Table of Contents Effecting Our Initial Business Combination Under our amended and restated certificate of incorporation, we will have until 12 months from the closing of this offering to consummate an initial business combination. However, if we anticipate that we may not be able to consummate our initial business combination within 12 months, we may extend the period of time to consummate a business combination up to six times, each by an additional period of one month (for a total of up to 18 months to complete a business combination). Pursuant to the terms of our amended and restated certificate of incorporation, in order to extend the time available for us to consummate our initial business combination beyond the initial 12 month period, our sponsor or its affiliates or designees, upon five (5) days advance notice prior to the applicable deadline, must deposit into the trust account $363,000, or up to $417,450 if the underwriters over-allotment option is exercised in full ($0.033 per share in either case) on or prior to the date of the applicable deadline, for each one month extension (or up to an aggregate of $2,178,000 (or $2,504,700 if the underwriters over-allotment option is exercised in full), or $0.198 per share if we extend for the full six months). In evaluating a prospective target business, we expect to conduct a detailed due diligence review of the issues that we deem important to determine a company s business quality, estimate its intrinsic value and assess growth and value creation opportunities. This due diligence may include, among other things, financial statement analysis, meetings with management and employees, consultations with competitors, suppliers, customers, and industry experts, background checks on key employees, and other legal and financial information. We are not prohibited from pursuing a partnering transaction with a company that is affiliated with our sponsor, our officers or our directors. In the event we seek to complete our partnering transaction with a business that is affiliated with our sponsor, our officers or our directors, we, or a committee of independent and disinterested directors, will obtain an opinion from an independent investment banking firm or from another independent entity that commonly renders valuation opinions, that such a partnering transaction is fair to our company from a financial point of view. Members of our management team will directly or indirectly own our securities following this offering and, accordingly, may have a conflict of interest in determining whether a partnering target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. With funds available for an initial business combination initially in the amount of $110,550,000 after payment of $2,750,000 of deferred underwriting commissions (or $127,132,500, after payment of $3,162,500 of deferred underwriting commissions if the underwriters over-allotment option is exercised in full), in each case before fees and expenses associated with our initial business combination, we offer a target business a variety of options such as creating a liquidity event for its owners, providing capital for the potential growth and expansion of its operations or strengthening its balance sheet by reducing its debt or leverage ratio. Because we are able to complete our initial business combination using our cash, debt or equity securities, or a combination of the foregoing, we have the flexibility to use the most efficient combination that will allow us to tailor the consideration to be paid to the target business to fit its needs and desires. However, we have not taken any steps to secure third party financing and there can be no assurance it will be available to us. We are not presently engaged in, and we will not engage in, any operations for an indefinite period of time following this offering. We intend to effectuate our initial business combination using cash from the proceeds of this offering and the private placement of the private placement units, the proceeds of the sale of our shares in connection with our initial business combination (pursuant to forward purchase agreements or backstop agreements we may enter into following the consummation of this offering or otherwise), shares issued to the owners of the target, debt issued to bank or other lenders or the owners of the target, or a combination of the foregoing. We may seek to complete our initial business combination with a company or business that may be Table of Contents financially unstable or in its early stages of development or growth, which would subject us to the numerous risks inherent in such companies and businesses. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or used for redemptions of our common stock, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of the post-transaction company, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. We may seek to raise additional funds through a private offering of debt or equity securities in connection with the completion of our initial business combination, and we may effectuate our initial business combination using the proceeds of such offering rather than using the amounts held in the trust account. In addition, we intend to target businesses larger than we could acquire with the net proceeds of this offering and the sale of the private placement units, and may as a result be required to seek additional financing to complete such proposed initial business combination. Subject to compliance with applicable securities laws, we would expect to complete such financing only simultaneously with the completion of our initial business combination. In the case of an initial business combination funded with assets other than the trust account assets, our proxy materials or tender offer documents disclosing the initial business combination would disclose the terms of the financing and, only if required by law, we would seek stockholder approval of such financing. There are no prohibitions on our ability to raise funds privately or through loans in connection with our initial business combination. At this time, we are not a party to any arrangement or understanding with any third party with respect to raising any additional funds through the sale of securities or otherwise. We have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. From the period commencing with our formation through the date of this prospectus, there have been no communications or discussions between any of our officers, directors, our sponsor or advisors and any of their potential contacts or relationships regarding a potential initial business combination. Additionally, we have not engaged or retained any agent or other representative to identify or locate any suitable acquisition candidate, to conduct any research or take any measures, directly or indirectly, to locate or contact a target business. Accordingly, there is no current basis for investors in this offering to evaluate the possible merits or risks of the target business with which we may ultimately complete our initial business combination. Although our management will assess the risks inherent in a particular target business with which we may combine, we cannot assure you that this assessment will result in our identifying all risks that a target business may encounter. Furthermore, some of those risks may be outside of our control, meaning that we can do nothing to control or reduce the chances that those risks will adversely impact a target business. Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. The fair market value of our initial business combination will be determined by our board of directors based upon one or more standards generally accepted by the financial community, such as discounted cash flow valuation, a valuation based on trading multiples of comparable public businesses or a valuation based on the financial metrics of M&A transactions of comparable businesses. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. Subject to this requirement, our management will Table of Contents have virtually unrestricted flexibility in identifying and selecting one or more prospective target businesses, although we will not be permitted to effectuate our initial business combination with another blank check company or a similar company with nominal operations. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business. The determination of whether or not to acquire less than 100% of the equity interests or assets will be dependent upon numerous factors, including satisfaction certain objectives of the target management team or target s shareholders, the costs of any such proposed acquisition or for other reasons, many of which we cannot determine at this time and will be contingent upon negotiations with prospective targets. We will only complete a business combination for equity interests if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. In considering an asset transaction, we would acquire such assets only if we could constitute from such assets a stand-alone operating business. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our business combination could own less than a majority of our outstanding shares subsequent to our business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of Nasdaq net assets test. If our business combination involves more than one target business or assets from different businesses, the 80% of net assets test will be based on the aggregate value of all of the target businesses. Recent PCAOB Developments Future developments in U.S. laws may restrict our ability or willingness to complete business combinations with certain companies. For instance, the Holding Foreign Companies Accountable Act (the HFCAA ) would restrict our ability to consummate a business combination with a target business unless that business met certain standards of the PCAOB and would require delisting of a company from U.S. national securities exchanges if the PCAOB is unable to inspect its public accounting firm for three consecutive years. The HFCAA also requires public companies to disclose, among other things, whether they are owned or controlled by a foreign government. We may not be able to consummate a business combination with a favored target business due to these laws. Furthermore, on June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act ( AHFCAA ), which, if signed into law, would amend the HFCAA and require the SEC to prohibit an issuer s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three consecutive years. The documentation we may be required to submit to the SEC proving certain beneficial ownership requirements and establishing that we are not owned or controlled by a foreign government or where the PCAOB is unable to completely inspect or investigate our accounting practices or financial statements because of a position taken by an authority in the foreign jurisdiction could be onerous and time consuming to prepare. On March 24, 2021, the SEC adopted interim final rules relating to the implementation of certain disclosure and documentation requirements of the HFCAA. An identified issuer will be required to comply with these rules if the SEC identifies it as having a non-inspection year under a process to be subsequently established by the SEC. Table of Contents On November 5, 2021, the SEC approved the PCAOB s Rule 6100, Board Determinations Under the Holding Foreign Companies Accountable Act. Rule 6100 provides a framework for the PCAOB to use when determining, as contemplated under the HFCAA, whether it is unable to inspect or investigate completely registered public accounting firms located in a foreign jurisdiction because of a position taken by one or more authorities in that jurisdiction. On December 2, 2021, the SEC issued amendments to finalize rules implementing the submission and disclosure requirements in the HFCAA. The rules apply to registrants that the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located in a foreign jurisdiction and that the PCAOB is unable to inspect or investigate completely because of a position taken by an authority in foreign jurisdictions. On December 16, 2021, the PCAOB issued a Determination Report which found that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in: (i) China, and (ii) Hong Kong. Our auditor, Marcum Asia CPAs LLP (formerly known as Marcum Bernstein & Pinchuk LLP), is headquartered in New York, NY, is an independent registered public accounting firm with the PCAOB and has been inspected by the PCAOB on a regular basis. Our auditor is not headquartered in China or Hong Kong and was not identified in this report as a firm subject to the PCAOB s determination. However, if we engage auditors in the future that are unable to be inspected by the PCAOB, trading in our securities on the U.S. stock exchanges or in the over the counter trading market in the U.S. could be stopped or our securities could be delisted from any national exchange on which such securities are traded. See Risk Factor The Chinese government may intervene in or influence a PRC company s business operations at any time or to exert more oversight and control over offerings conducted overseas and foreign investment in China-based issuers. This could result in a material change in a PRC company s business operations post business combination and/or the value of its securities. Additionally, governmental and regulatory interference could significantly limit or completely hinder a target company s ability to offer or continue to offer securities to investors post business combination and cause the value of such securities to significantly decline or be worthless. On August 26, 2022, the PCAOB signed a Statement of Protocol with the China Securities Regulatory Commission and the Ministry of Finance of PRC ( SOP ), taking the first step toward opening access for the PCAOB to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong. Pursuant to the SOP, the PCAOB shall have independent discretion to select any issuer audits for inspection or investigation and has the unfettered ability to transfer information to the SEC. However, uncertainties still exist as to whether the applicable parties, including governmental agencies, will fully comply with the framework. Depending on the implementation of the SOP, if the PCAOB continues to be prohibited from conducting complete inspections and investigations of PCAOB-registered public accounting firms in China, then China-based companies will be delisted pursuant to the HFCA Act despite the SOP. Therefore, there is no assurance that the SOP could give relief to China-based companies against the delisting risk from the application of the HFCA Act or AHFCAA. The SEC is assessing how to implement other requirements of the HFCAA, including the listing and trading prohibition requirements described above. Future developments in respect of increase U.S. regulatory access to audit information are uncertain, as the legislative developments are subject to the legislative process and the regulatory developments are subject to the rule-making process and other administrative procedures. In the event that we complete a business combination with a non-U.S. company and any of the legislative actions or regulatory changes discussed above were to proceed in ways that are detrimental to a non-U.S. issuer, it could cause us to fail to be in compliance with U.S. securities laws and regulations, we could cease to be listed on a U.S. securities exchange, and U.S. trading of our shares could be prohibited. Any of these actions, or uncertainties in the market about the possibility of such actions, could adversely affect our prospects to successfully complete a business combination with a non-U.S. company, our access to the U.S. capital markets and the price of our shares. Table of Contents Corporate Information Our executive offices are located at 16800 Aston St, Ste 275, Irvine, California 92606 and our telephone number is (949) 998-4321. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our shares held by non-affiliates exceeds $250 million as of the prior June 30, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our shares held by non-affiliates exceeds $700 million as of the prior June 30. Table of Contents THE OFFERING In deciding whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team and advisors, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section of this prospectus entitled Risk Factors beginning on page 36. Securities offered 11,000,000 units, at $10.00 per unit, each unit consisting of: one share of common stock; and one redeemable warrant, each warrant exercisable to purchase one share of common stock. Proposed Nasdaq symbols Units: ZTOPU Common Stock: ZTOP Warrants: ZTOPW Trading Commencement The units will begin trading promptly after the date of this prospectus. The shares and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless EF Hutton informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the shares and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares and warrants. Separate trading of the shares and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the shares and warrants be traded separately until we have filed with the SEC a Current Report on Form 8-K which includes an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which is anticipated to take place within three business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. Units: Number outstanding before this offering and the private placement 0 Table of Contents Number outstanding after this offering and the private placement 11,587,500(1) Shares: Number issued and outstanding before this offering and the private placement 3,162,500 shares(2) Number to be outstanding after this offering and the private placement 14,585,000 shares(3) Warrants: Number outstanding before this offering and the private placement 0 warrants Number to be outstanding after this offering and private placement 11,000,000 public warrants and 587,500 private placement warrants(4) Terms of the Public Warrants: Each public warrant entitles the holder thereof to purchase one (1) share of common stock. Exercisability: The exercise price of the public warrants is $11.50 per share. In addition, if (x) we issue additional shares of common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share of common stock (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or such affiliates, as applicable, prior to such issuance) (the Newly Issued Price ), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the (1) Assumes the over-allotment option has not been exercised. Our sponsor has agreed to purchase an aggregate of 587,500 private placement units (649,375 private placement units if the over-allotment option is exercised in full). The private placement units are not subject to forfeiture but will be subject to transfer restrictions as described elsewhere in this prospectus. (2) Includes an aggregate of up to 412,500 sponsor shares that are subject to forfeiture if the over-allotment option is not exercised by the underwriters in full. (3) Comprised of 11,000,000 public shares, 2,750,000 founder shares, 587,500 private placement shares, and 247,500 representative shares. Assumes the over-allotment option has not been exercised and an aggregate of 412,500 sponsor shares and 37,125 representative shares have been forfeited. (4) Assumes the over-allotment option has not been exercised and accounts for the private placement of 587,500 private placement units. Table of Contents consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our common stock during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the Market Value ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price described below under Redemption of warrants will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. No public warrants will be exercisable for cash unless we have an effective and current registration statement covering the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to such shares of common stock. It is our current intention to have an effective and current registration statement covering the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to such shares of common stock in effect promptly following consummation of an initial business combination. Notwithstanding the foregoing, if a registration statement covering the shares of common stock issuable upon exercise of the public warrants is not effective within 60 days following the consummation of our initial business combination, public warrant holders may, until such time as there is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to an available exemption from registration under the Securities Act. In such event, each holder would pay the exercise price by surrendering the whole warrants for that number of shares of common stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value shall mean the average reported last sale price of the shares of common stock for the five trading days ending on the day prior to the date of exercise. For example, if a holder held 300 warrants to purchase 300 shares and the fair market value on the date prior to exercise was $15.00, that holder would receive 70 shares without the payment of any additional cash consideration. The warrants will become exercisable on the later of one (1) year from the closing of this offering and 30 days after the consummation of an initial business combination. The warrants will expire at 5:00 p.m., New York City time, on the fifth anniversary of our completion of an initial business combination, or earlier upon redemption. Table of Contents Redemption: We may redeem the outstanding warrants (including the private placement warrants), in whole and not in part, at a price of $0.01 per warrant: at any time while the warrants are exercisable, upon a minimum of 30 days prior written notice of redemption, if, and only if, the last sales price of our shares of common stock equals or exceeds $18.00 per share for any 20 trading days within a 30-trading day period commencing once the warrants become exercisable and ending three business days before we send the notice of redemption, and if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption. If the foregoing conditions are satisfied and we issue a notice of redemption, each warrant holder can exercise his, her or its warrant prior to the scheduled redemption date. However, the price of our shares of common stock may fall below the $18.00 trigger price, as well as the $11.50 warrant exercise price after the redemption notice is issued. The redemption criteria for our warrants have been established at a price which is intended to provide warrant holders a reasonable premium to the initial exercise price and provide a sufficient differential between the then-prevailing share price and the warrant exercise price so that if the share price declines as a result of our redemption call, the redemption will not cause the share price to drop below the exercise price of the warrants. If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In such event, each holder would pay the exercise price by surrendering the whole warrants for that number of shares of common stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value shall mean the average reported last sale price of the shares of common stock for the five trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Whether we will exercise our option to require all holders to exercise their warrants on a cashless basis will depend on a variety of factors including the price of our shares of common stock at the time the warrants are called for redemption, our cash needs at such time and concerns regarding dilutive share issuances. Table of Contents Securities purchased, or being purchased, by insiders Our sponsor has purchased an aggregate of 3,162,500 shares of common stock for an aggregate purchase price of $25,000. The 3,162,500 shares owned by the sponsor and certain of our officers and directors as of the closing of the offering includes an aggregate of up to 412,500 shares of common stock subject to forfeiture to the extent that the over-allotment option is not exercised by the underwriters in full or in part, so that the sponsor shares held by our founders will continue to account for, in the aggregate, 20% of our issued and outstanding shares after this offering (excluding the representative shares, shares underlying the private units and assuming that our founders do not purchase units in this offering). None of our founders has indicated any intention to purchase units in this offering. Additionally, our sponsor has agreed to purchase an aggregate of 587,500 private placement units (649,375 private placement units if the over-allotment option is exercised in full) at a price of $10.00 per unit, for an aggregate purchase price of $5,875,000 (or $6,493,750 if the over-allotment option is exercised in full). Each private placement unit will be identical to the units sold in this offering, except as described in this prospectus. There will be no redemption rights or liquidating distributions from the trust account with respect to the private placement shares or private placement warrants, which will expire worthless if we do not consummate a business combination within the allotted 18 month period. The sponsor shares are identical to the shares of common stock included in the units being sold in this offering. However, our founders have agreed (A) to vote their sponsor shares (as well as the private placement shares and any public shares acquired in or after this offering) in favor of any proposed business combination, (B) not to propose an amendment to the Certificate of Incorporation, prior to a business combination, to affect the substance or timing of the Company s obligation to redeem all public shares if it cannot complete a business combination within 12 months (or up to 18 months, if extended) of the closing of this proposed offering, unless the Company provides public stockholders an opportunity to redeem their public shares, (C) not to redeem any shares in connection with a stockholder vote to approve a proposed initial business combination or any amendment to our Certificate of Incorporation prior to consummation of an initial business combination, or sell any shares to us in a tender offer in connection with a proposed initial business combination, and (D) that the sponsor shall not participate in any liquidating distribution from the trust account upon winding up if a business combination is not consummated (except for any public shares that it may hold). The private placement warrants to be issued as part of the private placement units at closing of this offering are identical to the warrants underlying the units sold in this offering except for certain restrictions Table of Contents on transferability as described in this prospectus. Accordingly, we may redeem the private warrants on the same terms and conditions as the public warrants. In the event of a liquidation prior to our initial business combination, all of our warrants, including the private placement warrants held by the sponsor (or its affiliates or designees) will be worthless. Restrictions on transfer of sponsor shares and private placement units (and the component securities) Subject to certain limited exceptions, our initial stockholders have agreed not to transfer, assign, or sell any of their founder shares until the earlier to occur of: (1) one year after the completion of our initial business combination; or (2) the date on which we complete a liquidation, merger, stock exchange, reorganization or other similar transaction after our initial business combination that results in all of our public stockholders having the right to exchange their shares of common stock for cash, securities or other property. Any permitted transferees would be subject to the same restrictions and other agreements of our sponsor with respect to any sponsor shares. Notwithstanding the foregoing, the sponsor shares will be released from these restrictions if the closing price of our common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 120 days after our initial business combination. The limited exceptions include transfers, assignments or sales (i) to our officers or directors, any affiliate or family member of any of our officers or directors, any of the sponsor s, members, officers, directors, consultants, or affiliates of the sponsor or any of their affiliates or family members or to any employee of any such affiliate, (ii) by gift to a member of an individual stockholder s family or to a trust, the beneficiary of which is a member of such individual s immediate family, an affiliate of such individual or to a charitable organization to relatives and trusts for estate planning purposes, (iii) by virtue of the laws of descent and distribution upon death, (iv) pursuant to a qualified domestic relations order, (v) in connection with the consummation of a business combination at prices no greater than the price at which the shares were originally purchased, (vi) to us for no value for cancellation in connection with the consummation of our initial business combination, (vii) in the event of our liquidation prior to our consummation of an initial business combination, (viii) by virtue of the laws of the State of Delaware or the sponsor or other founder s limited liability company, partnership or trust agreement, as amended, or other organizational documents, upon dissolution of the sponsor or a founder; or (ix) in the event that, subsequent to the consummation of an initial business combination, we complete a liquidation, merger, capital stock exchange or other similar transaction which results in all of our stockholders having the right to Table of Contents exchange their common stock for cash, securities or other property, in each case (except for clauses (vi), (vii), or (ix) or with our prior consent) where the transferee agrees to be bound by these transfer restrictions. The sponsor has also agreed not to transfer, assign or sell any of the private placement units (and the underlying securities) (except to the same permitted transferees as the sponsor with respect to the sponsor shares and provided the transferees agree to the same terms and restrictions as the permitted transferees of the sponsor must agree to, each as described above) until 30 days after the completion of our initial business combination. Representative s shares We have agreed to issue to EF Hutton and its designees an aggregate of 284,625 representative shares, up to 37,125 of which are subject to forfeiture if the over-allotment option is not exercised in full, on the closing of this offering. The holders of the representative shares have agreed not to transfer, assign or sell any such shares without our prior consent until the completion of our initial business combination. In addition, the holders of the representative shares have agreed (i) to waive their redemption rights (or right to participate in any tender offer) with respect to such shares in connection with the completion of our initial business combination and (ii) to waive their rights to liquidating distributions from the trust account with respect to such shares if we fail to complete our initial business combination within 12 months (or up to 18 months) from the closing of this offering. Offering proceeds to be held in trust Nasdaq rules require that at least 90% of the gross proceeds from this offering and the sale of the private placement units be deposited in a trust account. Of the net proceeds of this offering and the sale of the private placement units, $113,300,000 (or $130,295,000 if the over-allotment option is exercised in full), or $10.30 per unit sold to the public in this offering, will be placed in a U.S.-based trust account at J.P. Morgan Chase Bank, N.A., maintained by Continental Stock Transfer & Trust Company, acting as trustee pursuant to an agreement to be signed on the date of this prospectus. The remaining net proceeds of this offering and sale of the private placement units will not be held in the trust account. Except as set forth below, the proceeds held in the trust account will not be released until the earlier of (i) the completion of an initial business combination, (ii) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated certificate of incorporation to (A) modify the substance or timing of our obligation to allow redemption rights as described in this prospectus) or (B) with respect to any other provision relating to shareholders rights or pre-business combination activity, and (iii) our redemption of 100% of the outstanding public shares if we have not completed a business combination in the required time period. Therefore, unless and until an initial business Table of Contents combination is consummated, the proceeds held in the trust account will not be available for our use for any expenses related to this offering or expenses which we may incur related to the investigation and selection of a target business and the negotiation of an agreement to acquire a target business. Notwithstanding the foregoing, there can be released to us from the trust account any interest earned on the funds in the trust account that we need to pay our income or other tax obligations. With this exception, expenses incurred by us may be paid prior to a business combination only from the net proceeds of this offering and a portion of the proceeds from the private placement of units not held in the trust account (initially estimated to be $1,200,000); provided, however, that in order to meet our working capital needs following the consummation of this offering if the funds not held in the trust account are insufficient, our founders, officers, directors or their designees may, but are not obligated to, loan us funds, from time to time or at any time, in whatever amount they deem reasonable in their sole discretion. Each working capital loan would be evidenced by a promissory note. The working capital loans would either be paid upon consummation of our initial business combination, without interest, or, at the holder s discretion, up to $1,500,000 may be converted into units at a price of $10.00 per unit. Each unit will be identical to the private placement units. Except as set forth above, the terms of such loans by our officers and directors, if any, have not been determined and no written agreements exist with respect to such loans. In the event that the initial business combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts, but no proceeds from our trust account would be used for such repayment. Ability to extend time to complete business combination We will have until 12 months from the closing of this offering to consummate an initial business combination. However, if we anticipate that we may not be able to consummate our initial business combination within 12 months, we may extend the period of time to consummate a business combination up to six times, each by an additional period of one month (for a total of up to 18 months to complete a business combination). Pursuant to the terms of our amended and restated certificate of incorporation, in order to extend the time available for us to consummate our initial business combination, our sponsor or its affiliates or designees, upon five (5) days advance notice prior to the applicable deadline, must deposit into the trust account $363,000, or up to $417,450 if the underwriters over-allotment option is exercised in full ($0.033 per share in either case) on or prior to the date of the applicable deadline, for each one month extension (or up to an aggregate of $2,178,000 (or $2,504,700 if the underwriters over-allotment option is exercised in full), or $0.198 per share if we extend for the full six months). Such payments would be made in the form of a non-interest bearing loan and would Table of Contents be payable upon the consummation of our initial business combination or, at the option of the persons or persons funding such amounts convertible into additional private placement units. In the event that we receive notice from our sponsor that it will seek to extend the time for us to consummate an initial business combination, we intend to issue a press release announcing such expected extension at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the applicable deadline announcing whether or not the funds had been timely deposited. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. If we are unable to consummate our initial business combination within such time period, we will, as promptly as possible but not more than ten business days thereafter, redeem 100% of our outstanding public shares for a pro rata portion of the funds held in the trust account and then seek to dissolve and liquidate. In such event, the public warrants will expire and will be worthless. Limited payments to insiders There will be no fees, reimbursements or other cash payments paid to our founders, officers, directors or their affiliates for any services they render prior to, or in order to effectuate the consummation of, an initial business combination (regardless of the type of transaction that it is) other than the following payments, none of which will be made from the proceeds of this offering held in the trust account prior to the completion of our initial business combination: repayment at the consummation of this offering of $250,000 of the initial non-interest-bearing loans made by our sponsor and an affiliate of our sponsor; payment to an affiliate of our sponsor of an amount of $2,000 per month for office space, administrative and support services; reimbursement of out-of-pocket expenses incurred by management in connection with certain activities on our behalf, such as identifying and investigating possible target businesses and business combinations; and repayment upon consummation of our initial business combination of any non-interest bearing loans which may be made by our sponsor, our management or their respective affiliates or designees to finance transaction costs in connection with an intended initial business combination, which loans we sometimes refer to as working capital loans, of which up to $1,500,000 loan amount may be converted into additional private placement units. There is no limit on the amount of out-of-pocket expenses reimbursable by us; provided, however, that to the extent such Table of Contents expenses exceed the available proceeds not deposited in the trust account, such expenses would not be reimbursed by us unless we consummate an initial business combination. Our audit committee will review and approve all reimbursements and payments made to our founders, officers, directors or their respective affiliates, with any interested director abstaining from such review and approval. Anticipated expenses and funding sources Except as described above with respect to the payment of taxes, unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. The proceeds held in the trust account will be invested only in U.S. government securities with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. We will disclose in each quarterly and annual report filed with the SEC prior to our initial business combination whether the proceeds deposited in the trust account are invested in U.S. government treasury obligations or money market funds or a combination thereof. Based upon current interest rates, we expect the trust account to generate approximately $226,600 of pre-tax interest annually assuming an interest rate of 0.2% per year; however, we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement units not held in the trust account, which will be approximately $1,200,000 in working capital after the payment of approximately $550,000 in expenses relating to this offering excluding underwriting discounts; and any loans or additional investments from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation to advance funds or invest in us, and provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of an initial business combination. Conditions to completing our initial business combination Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. If our securities are not listed on the Nasdaq after this offering, we would not be required to satisfy the 80% requirement. However, we intend to satisfy the 80% requirement even if our securities are not listed on Table of Contents Nasdaq at the time of our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. We anticipate structuring our initial business combination either (i) in such a way so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses, or (ii) in such a way so that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders, or for other reasons. However, we will only complete an initial business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of Nasdaq s 80% fair market value test. If the initial business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. Table of Contents Permitted purchases of public shares and public warrants by our affiliates If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, initial stockholders, directors, officers, advisors or their affiliates may purchase shares or public warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. There is no limit on the number of shares our initial stockholders, directors, officers, advisors or their affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. However, (apart from the purchase of the private placement units) they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Securities Exchange Act of 1934, as amended (the Exchange Act ). We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. None of the funds held in the trust account will be used to purchase shares or public warrants in such transactions. See Proposed Business Permitted purchases of our securities for a description of how our sponsor, initial stockholders, directors, officers, advisors or any of their affiliates will select which stockholders to purchase securities from in any private transaction. The purpose of any such purchases of shares could be to vote such shares in favor of the initial business combination and thereby increase the likelihood of obtaining stockholder approval of the initial business combination or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of Table of Contents our shares of common stock or warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Indemnity by Sponsor Toprun Smart Management LLC, our sponsor, has agreed that it will be liable to us, if and to the extent any claims by a vendor for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amounts in the trust account to below $10.30 per share (whether or not the underwriter s over-allotment option is exercised in full), except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriter of this offering against certain liabilities, including liabilities under the Securities Act. In the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third-party claims. Our sponsor has been newly formed and we believe that our sponsor s only assets are securities or promissory notes of our company. We therefore believe it is unlikely our sponsor would be able to satisfy any indemnification obligations should they arise. However, we believe the likelihood of our sponsor having to indemnify the trust account is limited because we will endeavor to have all vendors and prospective target businesses as well as other entities execute agreements with us waiving any right, title, interest or claim of any kind in or to monies held in the trust account. Stockholder approval of, or tender offer in connection with, initial business combination In connection with any proposed initial business combination, we will either (1) seek stockholder approval of such initial business combination at a meeting called for such purpose at which stockholders may seek to redeem their shares, regardless of whether they vote for or against the proposed business combination, into their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable), or (2) provide our stockholders with the opportunity to sell their shares to us by means of a tender offer (and thereby avoid the need for a stockholder vote) for an amount equal to their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable), in each case subject to the limitations described herein. If we determine to engage in a tender offer, such tender offer will be structured so that each stockholder may tender all of his, her or its shares rather than some pro rata portion of his, her or its shares. The decision as to whether we will seek stockholder approval of a proposed business combination or will allow stockholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek stockholder Table of Contents approval. Our amended and restated certificate of incorporation will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 upon consummation of our initial business combination. Accordingly, we will consummate our initial business combination only if we have net tangible assets (as determined in accordance with Rule 3a51-1(g) of the Exchange Act, or any successor rule) of at least $5,000,001 immediately prior to or upon consummation of the business combination, and, if we seek stockholder approval, a majority of the outstanding shares of common stock voted are voted in favor of the business combination. We chose our net tangible asset threshold of $5,000,001 to ensure that we avoid being subject to Rule 419 promulgated under the Securities Act. However, if we seek to consummate an initial business combination with a target business that imposes any type of working capital closing condition or requires us to have a minimum amount of funds available from the trust account upon consummation of such initial business combination, we may need to have more than $5,000,001 in net tangible assets upon consummation and this may force us to seek third party financing which may not be available on terms acceptable to us or at all. As a result, we may not be able to consummate such initial business combination and we may not be able to locate another suitable target within the applicable time period, if at all. Our sponsor and officers and directors and their affiliates have agreed (i) to vote their sponsor shares as well as any public shares acquired in or after this offering in favor of any proposed business combination, (ii) not to propose an amendment to the Certificate of Incorporation, prior to a business combination, to affect the substance or timing of the Company s obligation to redeem all public shares if it cannot complete a business combination within 12 months (or up to 18 months, if extended) of the closing of this proposed offering, unless the Company provides public stockholders an opportunity to redeem their public shares, (iii) not to redeem any shares in connection with a stockholder vote to approve a proposed initial business combination or any amendment to our charter prior to the consummation of our initial business combination and (iv) not to sell any shares to us in a tender offer in connection with any proposed initial business combination. If we seek stockholder approval, we will complete our initial business combination only if a majority of the then outstanding shares of common stock present and entitled to vote at the meeting to approve the initial business combination when a quorum is present are voted in favor of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the Company representing a majority of the voting power of all outstanding shares of capital stock Table of Contents of the Company entitled to vote at such meeting. Our initial stockholders will count towards this quorum and, pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote any founder shares held by them and any public shares acquired by them during or after this offering (including in open market and privately-negotiated transactions) in favor of our initial business combination. As a result, in addition to the shares held by our initial stockholders, we would need only 3,955,001, or approximately 36%, of the public shares sold in this offering to be voted in favor of an initial business combination (assuming all outstanding shares are voted) in order to have our initial business combination approved (assuming the over-allotment option is not exercised). Further, assuming that the over-allotment option is not exercised, a quorum of 7,292,501 shares of our common stock present in person or by proxy would be required to hold the stockholder meeting to approve our initial business combination, and, assuming only the minimum number of shares representing a quorum are voted, such approval would require the affirmative vote of 3,646,251 shares of our common stock, which means that, in addition to our initial stockholders shares, we would need only 308,751, or approximately 2.8%, of the 11,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved. These quorum and voting thresholds, and the voting agreements of our initial stockholders, may make it more likely that we will consummate our initial business combination. None of our sponsor, officers, directors or their affiliates has indicated any intention to purchase units in this offering or any units or shares of common stock from persons in the open market or in private transactions. However, if we hold a meeting to approve a proposed business combination and a significant number of stockholders vote, or indicate an intention to vote, against a proposed business combination, or choose to redeem their shares, our founders, officers, directors or their affiliates could make such purchases in the open market or in private transactions in order to influence any vote held to approve a proposed initial business combination or to increase the likelihood of satisfying any closing conditions. Notwithstanding the foregoing, our officers, directors, founders and their affiliates will not make purchases of shares of common stock if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act, which are rules designed to stop potential manipulation of a company s stock. Redemption rights In connection with any stockholder meeting called to approve a proposed initial business combination, each public stockholder will have the right, regardless of whether he or she is voting for or against such proposed business combination, or whether he or she was a stockholder on the record date for such stockholder meeting, to Table of Contents demand that we redeem his, her or its shares into a pro rata share of the trust account (initially $10.30 per share, plus any pro rata interest earned on the funds held in the trust account less amounts necessary to pay our taxes). We may require public stockholders, whether they are a record holder or hold their shares in street name, to either (i) physically tender their certificates (if any) to our transfer agent or (ii) deliver their shares to the transfer agent electronically using Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option, in each case prior to a date set forth in the tender offer documents or proxy materials sent in connection with the proposal to approve the business combination. There is a nominal cost associated with this tendering process and the act of certificating the shares or delivering them through the DWAC system. The transfer agent will typically charge the tendering broker a fee and it would be up to the broker whether to pass this cost on to the redeeming holder. Redemption rights in connection with proposed amendments to our certificate of incorporation Our amended and restated certificate of incorporation provides that any of its provisions related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the private placement of warrants into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein) may be amended if approved by holders of a majority of our common stock entitled to vote thereon, subject to applicable provisions of the Delaware General Corporation Law, or DGCL, or applicable stock exchange rules. Under our amended and restated certificate of incorporation, we may not issue additional securities that can vote on amendments to our amended and restated certificate of incorporation or on our initial business combination or that would entitle holders thereof to receive funds from the trust account. Our sponsor, officers and directors who will collectively beneficially own approximately 20% of our outstanding shares of common stock upon the closing of this offering (assuming they do not purchase any units in this offering but that the over-allotment option is exercised in full), will participate in any vote to amend our amended and restated certificate of incorporation and, subject to the terms of the letter agreement with us, will have the discretion to vote in any manner they choose. Our sponsor, executive officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to allow holders to redeem their shares in connection with an initial business combination or amendments to our charter prior thereto or to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from Table of Contents the closing of this offering or (ii) with respect to any other provision relating to stockholders rights or pre-business combination activity, unless we provide our public stockholders with the opportunity to redeem their public shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then outstanding public shares. Our sponsor, officers and directors have entered into a letter agreement with us pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and any public shares held by them in connection with the completion of our initial business combination. Liquidation if no business combination Our amended and restated certificate of incorporation provides that we will have only 12 months (or up to 18 months, if extended) from the closing of this offering to complete our initial business combination. If we are unable to complete our initial business combination within such period, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the trust account (net of taxes payable), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidation distributions, if any) and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our Board of Directors, liquidate and dissolve. There will be no redemption rights or liquidating distributions with respect to our warrants which will expire worthless if we fail to complete our initial business combination within the 12-month time period (or up to 18-month time period, if extended) from the closing of this offering. We may not have funds sufficient to pay or provide for all creditors claims. Although we will seek to have all third parties (including any vendors or other entities we engage after this offering) and any prospective target businesses enter into valid and enforceable agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account, there is no guarantee that they will execute such agreements. There is also no guarantee that the third parties would not challenge the enforceability of these waivers and bring claims against the trust account for monies owed them. Neither our sponsor nor any officer or director will participate in any liquidation distribution from our trust account with respect to the private placement warrants or sponsor shares. Table of Contents We will pay the costs of liquidating the trust account from our remaining assets outside of the trust account. If such funds are insufficient, our sponsor has contractually agreed to advance us the funds necessary to complete such liquidation and has contractually agreed not to seek repayment for such expenses. Limitation on redemption rights of stockholders holding 15% or more of the shares sold in this offering if we hold stockholder vote. Notwithstanding the foregoing description of redemptions rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. Without this provision, a public stockholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against an initial business combination if such holder s shares are not purchased by us or our management at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with an initial business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders ability to vote all of their shares (including all shares held by those stockholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Table of Contents
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+the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: common stock are to our common stock, par value $0.0001; company or our company we, us, are to Makara Strategic Acquisition Corp.; equity-linked securities are to any securities of our company which are convertible into or exchangeable or exercisable for, common stock of our company, including but not limited to a private placement of equity or debt; founder shares are to shares of our common stock initially purchased by our sponsor in a private placement prior to this offering; initial stockholders are to our sponsor, and any other holders of our founder shares prior to this offering; management or our management team are to our officers and directors; private placement warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering and warrants issued in conversion of working capital loans; public shares are to shares of our common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our initial stockholders and management team to the extent they purchase public shares, provided that each initial stockholder s and member of our management team s status as a public stockholder shall only exist with respect to such public shares; public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and to any private placement warrants issued upon conversion of working capital loans that are sold to third parties that are not initial purchasers or executive officers or directors (or permitted transferees) following the consummation of our initial business combination; representative shares are to the 250,000 shares of common stock to be issued to the underwriter upon consummation of this offering (or 287,500 shares if the over-allotment option is exercised in full); sponsor are to Makara Strategic Sponsor, Inc., a corporation formed under the laws of the United States Virgin Islands; and warrants are to our redeemable warrants, which includes the public warrants as well as the private placement warrants, which are identical. Each unit consists of one share of common stock and one redeemable warrant. Each warrant entitles the holder thereof to purchase one share of our common stock at a price of $11.50 per share, subject to adjustment as described in this prospectus. Registered trademarks referred to in this prospectus are the property of their respective owners. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. 1 PROPOSED BUSINESS Our Company We are a newly organized blank check company incorporated on June 4, 2021, as a Delaware corporation and formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination or our business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf initiated any substantive discussions, directly or indirectly, with any business combination target. Although we may pursue an initial business combination with any business in any industry, we intend to target opportunities that focus on natural resources, clean energy or energy storage sectors in the Americas, Europe or Asia. We believe there is a broad and global spectrum of prospective companies that are poised to become market leaders in emerging sectors such as green energy and energy storage systems. While our target criteria span a wide range of corporate profiles, we intend to focus closely on natural resources, minerals, and related infrastructure, energy storage and efficiency, renewable energy, as well as related environmental infrastructure, utilization and storage, among others. We intend to focus our search on companies in the Americas, Europe, and Asia. We believe that there are a significant number of target companies that could become outperforming public companies in our areas of focus, and we will seek to utilize the extensive operational and investment experience of our management team to identify companies that we believe are attractively valued and have significant growth prospects with the potential to generate robust returns for our stockholders. Our Sponsor, Management Team, and Directors We will seek to capitalize on the significant contacts and experience of our Board of Directors comprised of Dr. Amin Badr-El-Din, our Chairman, Ali Ijaz Ahmad, Amlan Baijal, Michael Bowling and Sanjay Vatsa. Our management team is led by Ali Ijaz Ahmad, our Chief Executive Officer and Director, Alexander C. Booth, our Chief Financial Officer and Sara Villarreal, our Chief Operating Officer. Dr. Amin Badr-El-Din Dr. Amin Badr-El-Din is our Chairman of the Board of Directors. Since 2005, he has served as the Founder and Chairman of BADR Investments, a global private investment house combining world-class strategic thinking and actively investing across various sectors including financial services, sustainable and renewable energy, extractive industries, real estate, engineering, manufacturing, and professional services. BADR Investments' global reach includes investments in North America, the Pacific Rim, Europe and the Middle East. Dr. Badr-El-Din also was an advisor to His Highness Crown Prince Sheikh Mohammed Bin Zayed Al Nahyan of Abu Dhabi. Between 1990 – 2000, Dr. Badr-El-Din has been Chairman and Chief Executive to the UAE Offsets Group, also known as Mubadala, which he created in the early 1990s. The Group led the way for the Government of UAE s privatization initiatives, including the creation of ADWEA (Abu Dhabi Water & Electricity Authority), the energy infrastructure project (Dolphin), Industrial Development Program, Mubadala sovereign fund, in addition to several other initiatives. Dr. Badr-El-Din conceived and launched Dolphin, which is a major strategic program designed to stimulate industrial and business investment in the UAE and beyond, with an overall objective of creating long-term economic growth for the Gulf Cooperation Council. In 1990 - 1991 he served on the United Nations Council responsible, among other things, for the environment. Together with Eddie Rothschild, he Co-Chaired the UN Conference on Finding Creative Mechanisms for Funding the Environment. This work lead to the uptake of Carbon Offsets as a trading mechanism and for monetization of activities that contribute to reduce the global carbon footprint. Dr. Badr-El-Din obtained a Bachelor of Science from the University of London and earned a Ph.D. in Electrical Engineering from Stanford University. Dr. Badr-El-Din is a member of several boards worldwide. He has advised various governments on economic development initiatives including Ireland, France, Jordan, UAE, South Africa, Malaysia, Switzerland and Indonesia. He is a fellow of the Royal Aeronautical Society. We concluded Dr. Badr-El-Din s experiences in sustainable and renewable energy technologies render him uniquely well to serve in these capacities. 2 Ali Ijaz Ahmad Ali Ijaz Ahmad is our Chief Executive Officer and a Director. Ali brings 25 years of experience in global asset management, private equity and cross-border deal structuring. He actively sits on and advises boards of leading institutions and governments on economic policy, intellectual property initiatives, financial markets and sustainable development, among others. Since 2006, Ali has served as the Managing Partner of Singapore-based Makara Capital, Limited, or Makara Capital, a financial services company founded in 2005 as a joint venture with Credit Suisse AG and later made independent by its founding partners. Makara specializes in fund management, private equity and deal-specific transactions in sectors that include innovation, infrastructure and energy. In addition to his role at Makara, Ali was appointed Special Advisor by Singapore Government to support the republic s bid to secure the position of Director-General of the United Nations World Intellectual Property Agency (WIPO) during the 2020 UN elections. Ali also serves on the Board of Directors of the Intellectual Property Office of Singapore (IPOS), which is the lead Government agency focused on innovation and tasked with building a vibrant and robust IP-enabled ecosystem for Singapore's future growth. Ali is an Advisor to Government of Alaska on Energy, with a focus on LNG markets in Asia with regards to developments of the Singapore LNG Hub. Ali holds a Master s in Public Administration from Harvard University (Kennedy School of Government), with a concentration in International Finance and Capital Markets, a Bachelor of Arts in Government and Physics from Bowdoin College, and a Bachelor of Science in Electrical Engineering from Columbia University. We believe Mr. Ahmad s extensive financial background and expertise in investing in public and private companies makes him well qualified to serve as our CEO and on our board of directors. Michael Bowling Michael Bowling is an Independent Director. Michael is a telecom and media executive with more than 30 years of experience in a variety of strategic and operational roles both in the domestic and international arenas. Michael is currently an Adjunct Professor at Vanderbilt University s Owen School of Business and is Managing Partner at Global Altitudes, LLC. Michael has served as the CEO of VRIO Corp., a digital entertainment provider in Latin America, and a division of AT&T from July 2021 through the sale of that enterprise in the fourth quarter of 2021. Previously, Michael served as President of DIRECTV LATAM, a VRIO company, since November 2016, where he was responsible for the pay TV business in the Spanish-speaking and Caribbean operations of VRIO. Prior thereto from September 2015, Michael served as Senior Vice President - Product and Emerging Business, responsible for developing strategies, products and emerging businesses for AT&T s VRIO division. In September 2013, Michael was appointed to serve as Senior Vice President - Corporate Strategy, responsible for driving AT&T s overall long-term planning and strategic initiatives. Previously, he served as Chief Marketing Officer - Business Solutions (2012-2013) and as President of AT&T Mexico (2009-2012) where he was a representative on the board of America Movil and served on the boards of Telmex (NYSE) and Telmex International (NYSE). Mr. Bowling joined AT&T from BellSouth Corporation and prior to the merger of AT&T and BellSouth Corporation, he served as Vice President of Converged Services and Platform Development as well as Vice President of Marketing and Product Management for Broadband from 2003 to 2005. In addition, Michael has served as the Chairman of the Board of Torneos and Competencias SA in Argentina and a member of the board of WIN Sports in Colombia from 2016 until 2021. He joined BellSouth in 1990. Michael holds an electrical engineering degree from the University of Kentucky and a master s degree in business administration from Vanderbilt University s Owen Graduate School of Business. We believe Mr. Bowling s extensive experience in developing strategy and operations in management and on boards of various and diverse companies makes him well qualified to serve on our board of directors. Sanjay Vatsa Sanjay is an Independent Director and the Chairman of our Audit Committee. Sanjay has more than 25 years of experience in senior C level global leadership positions having served as Managing Director at firms such as Citi, BlackRock, State Street and Merrill Lynch. Sanjay was elected to the board of DeFi Devs, a block chain protocol developer, in November 2021. Concurrently and since July 2020, Sanjay has served as the Chairman of the Advisory Board and President - International at Inveniam, making private markets data trusted and actionable. Simultaneously therewith and from October 2014, Sanjay has served as the Founder and Principal of Ideas to Result, LLC, providing advisory and consulting services for bulge bracket institutions. He is also an advisor to TallyX, a deep tier supply chain financing platform on blockchain powered by AI. Sanjay has been instrumental in the modernization of financial markets and the transformation of various financial firms. He has been a key player in transforming the financial services industry and has been Chairman of multiple industry committees at Bond Market Association, Asset Management Forum, Securities Industry Association, etc., transforming financial infrastructure and reducing risk on trade date. Sanjay, as Chairman of its Advisory Board, was instrumental in building OMGEO, a transformative financial industry utility. He has played an active and leadership role in shaping the Capital Markets infrastructure in India, USA and Singapore. Sanjay is an active angel investor / advisor to firms and late-stage startups where he provides innovative and disruptive solutions in health care, fintech, cryptocurrency and blockchain. Additionally, Sanjay is a Partner and Mentor at Princeton Growth Accelerator and a member of the Executive Committee at TIE Women, fostering women entrepreneurship, globally across 90 locations. Sanjay is a Chartered Accountant (ACA) and an MBA in Finance has had various roles as an auditor, financial controller and analyst for financial institutions globally. Sanjay received an MBA from the Simon School of Business, University of Rochester and a Bachelor of Commerce (Honors) from the University of Kolkatta, India. We believe Mr. Vatsa s extensive leadership experience at premiere institutions and background make him a well-qualified member of our board of directors. 3 Amlan Baijal Amlan Baijal is an Independent Director. Amlan has been in banking and finance for over 23 years and has worked and covered clients and deals in Europe, Asia, Africa and the Middle East. Amlan s experience includes corporate finance, mergers and acquisitions, capital markets, commodities and wealth management roles in various roles and locations with major European banks. Amlan was Managing Director in Credit Suisse, Managing Director in Standard Chartered Bank and held positions in RBS and American Express. Since January 2021, Amlan has served as a Partner in Makara Capital and is responsible for investments and deal flow. Makara Capital runs the Singapore innovation fund, mainly focusing on urban solutions, advanced technologies, fintech, consumer, alternative energy and healthcare. Makara Capital is an independent asset management company whose limited partners include mostly sovereign wealth funds and governments. Prior to joining Makara Capital, Amlan founded Roha Capital PTE in February 2016, which offers strategic advisory services across Asia and Europe to Asian clients looking to expand in European and other Asian markets. While at Credit Suisse, between October 2014 to January 2016, Amlan managed the bank s largest relationships in the region which included sovereign wealth funds, governments, large family offices as well as some of the largest shareholders of the bank. Amlan was involved in transactions that included energy, technology, financial services, infrastructure, real estate, hospitality, aviation and commodities. Amlan lead the Investment Partner Team for MENA. While at Standard Chartered between January 2010 to October 2014, Amlan was responsible for capital markets sales for MENA and Africa which included dealing with government, sovereigns and public sector institutions in the region where he dealt across debt capital markets, structured finance, and Commodities. Amlan received his MBA from Northeastern University and a Bachelor of Engineering from the University of Mysore, India. We believe Mr. Baijal s extensive financial background and expertise in investing makes him well qualified to serve as a member of our board of directors. Alexander C. Booth Alexander C. Booth is our Chief Financial Officer. Mr. Booth is managing director of DSP LLC, a finance, accounting, strategy and management consultancy which he founded in 2015. In that capacity he provides CFO, governance, strategy, finance and accounting guidance to a variety of clients in financial services, private industry and private equity. Mr. Booth also held finance executive and consulting positions with a number of private and public enterprises, primarily in financial services, including M&T Bank (1985 2000), AIB (2000 2003), Webster (2003 2006), HSBC (2006 2009), MetLife (2010 2016) and IDB Bank (2016 2018). Mr. Booth holds separate MBAs in Finance and Accounting from the Wharton School (University of Pennsylvania) and Canisius College, respectively. Sara Villarreal Sara Villarreal is our Chief Operating Officer. Ms. Villarreal brings over 15 years of global leadership experience across multiples sectors including real estate, hospitality, luxury retail and consumer goods with a focus on Asia and the Americas. Sara s expertise lies in operations and people management, investor relations, commercial real estate development and business strategy. Sara joined 8M Real Estate, a Singapore based real estate investment company with a portfolio of more than $900M AUM, in November 2014. Most recently, from December 2019 to July 2021, Sara served as its Chief Operating Officer. Sara received her Bachelors in Economics/Accounting from Claremont McKenna College. 4 Our Business Strategy and Competitive Strengths Our business strategy is to identify and consummate an initial business combination with a company in the natural resources, clean energy and energy storage sectors in the Americas, Europe and Asia. We will seek to acquire businesses that we believe are fundamentally strong with unique opportunities to expand globally within the enterprise value range of $3-$5 billion. Our management team and sponsor have experience in: Identifying and executing on multi-billion-dollar private equity investments globally and across sectors that have generated outperforming returns for investors; Managing portfolio clients and generating improved operational efficiencies that have significant impacts on overall profitability; Collaborating with management teams to establish pristine corporate governance structures that mutually align the parties involved with a business combination; Leveraging their extensive networks to grow businesses globally both organically and through acquisition; Identifying, acquiring, and structuring M&A transactions on behalf of public and private companies. Business Combination Criteria We have developed the following guidelines that we believe are important when we evaluate prospective target businesses. We intend to use these criteria and guidelines in evaluating acquisition opportunities. Companies with operations in the natural resources, minerals, or clean tech sectors. Based upon our management team s experience, we believe we have a competitive advantage and excellent access to investment opportunities when negotiating a business combination with potential targets in these sectors. Our management team s network of contacts and extensive experience provide them with opportunities to source and evaluate targets, enter into a business combination with a target and help grow the business. Companies that are fundamentally sound and have the potential for improved performance under our ownership. Our management team s experience in target sectors should create opportunities to enhance the operational efficiencies and revenue of the target business, while potentially generating higher returns for our investors. Significant growth opportunities. Apart from strong organic growth potential, we intend to look for companies that could meaningfully accelerate growth through geographic expansion, additional business combinations, disruptive products and engineering expertise. Appropriate valuations. We intend to be a disciplined and valuation-centric investor that will invest on terms that we believe are attractive relative to market comparables and that provide significant upside potential. Our Acquisition Process In evaluating a prospective target business, we expect to conduct an extensive due diligence review which may encompass, as applicable and among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities and a review of financial, operational, legal and other information about the target and its industry. We will also utilize our management team s operational and capital structuring experience. Each of our directors and officers will, directly or indirectly, own founder shares and/or private placement warrants following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. 5 Further, such directors and officers may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such directors and officers was included by a target business as a condition to any agreement with respect to our initial business combination. Certain of our officers and directors presently have, and any of them in the future may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity subject to his or her fiduciary duties. As a result, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, then, subject to such officer s and director s fiduciary duties, he or she will need to honor such fiduciary or contractual obligations to present such business combination opportunity to such entity, before we can pursue such opportunity. If these other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. However, we do not expect these duties or obligations to materially affect our ability to identify and pursue business combination opportunities or complete our initial business combination. Our amended and restated certificate of incorporation will provide that we renounce our interest in any business combination opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company and it is an opportunity that we are able to complete on a reasonable basis. In addition, our founders, officers and directors, are not required to commit any specified amount of time to our affairs, and, accordingly, will have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. See Risk Factors Our executive officers and directors will allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial business combination. Acquisition Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective targets for our initial business combination. We will consider these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target that does not meet these criteria and guidelines. We intend to acquire target businesses that we believe: are leading companies that have exhibited positive top-line growth and/or are experiencing secular tailwinds; have defensible and established business models, with sustainable competitive advantages and multiple opportunities for growth; can potentially benefit from having publicly-traded capital to accelerate their growth trajectory; can benefit from our management team including expertise, industry network and financing experience; are not reliant on financial leverage to generate returns; are at the point in their lifecycle at which going public is a natural next step; and will offer an attractive risk-adjusted return for our shareholders. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials that we would file with the SEC. Initial Business Combination Our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable) at the time of the agreement to enter into the initial business combination. If our board is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm that is a member of FINRA, or an independent accounting firm with respect to the satisfaction of such criteria. Our stockholders may not be provided with a copy of such opinion, nor will they be able to rely on such opinion. 6 The net proceeds of this offering and the sale of the private placement warrants released to us from the trust account upon the closing of our initial business combination may be used as consideration to pay the sellers of a target business with which we complete our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or used for redemption of our public shares, we may use the balance of the cash released to us from the trust account following the closing for general corporate purposes, including for maintenance or expansion of operations of the post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. In addition, we may be required to obtain additional financing in connection with the closing of our initial business combination to be used following the closing for general corporate purposes as described above. There is no limitation on our ability to raise funds through the issuance of equity or equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements or backstop agreements we may enter into following consummation of this offering. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our initial business combination. At this time, we are not a party to any arrangement or understanding with any third party with respect to raising any additional funds through the sale of securities or otherwise. None of our sponsors, officers, directors or stockholders is required to provide any financing to us in connection with or after our initial business combination. We may also obtain financing prior to the closing of our initial business combination to fund our working capital needs and transaction costs in connection with our search for and completion of our initial business combination. Our amended and restated certificate of incorporation will provide that, following this offering and prior to the consummation of our initial business combination, we will be prohibited from issuing additional securities that would entitle the holders thereof to (i) receive funds from the trust account or (ii) vote as a class with our public shares (a) on any initial business combination or (b) to approve an amendment to our amended and restated certificate of incorporation to (x) extend the time we have to consummate a business combination beyond 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus) or (y) amend the foregoing provisions, unless (in connection with any such amendment to our amended and restated certificate of incorporation) we offer our public stockholders the opportunity to redeem their public shares. Corporate Information Our executive offices are located at 5 Independence Way, Suite 430, Princeton, NJ 08540, and our telephone number is (732) 845-9067. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. 7 We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act. The Offering In making your decision on whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section of this prospectus entitled Risk Factors. Securities offered 25,000,000 units (or 28,750,000 units if the underwriter exercises its over-allotment option in full), at $10.00 per unit, each unit consisting of: one share of common stock; and one redeemable warrant. Nasdaq symbols Units: MKARU Common Stock: MKAR Warrants: MKARW Trading commencement and separation of common stock and warrants The units will begin trading on or promptly after the date of this prospectus. The common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless the representative informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the shares of common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of common stock and warrants. Separate trading of the common stock and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the common stock and warrants be traded separately until we have filed a Current Report on Form 8-K with the SEC containing an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which is anticipated to take place three business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. Units: Number outstanding before this offering 0 Number outstanding after this offering 25,000,000(1) 8 Common stock: Number outstanding before this offering 6,250,000 shares of common stock(2) Number outstanding after this offering 31,500,000 shares of common stock(2)(3) Redeemable warrants: Number of redeemable warrants to be sold simultaneously with this offering 11,370,000(1) Number of warrants to be outstanding after this offering and the private placement 36,370,000(1) (1) Assumes no exercise of the underwriters over-allotment option. (2) Assumes no exercise of the underwriters over-allotment option and the forfeiture of 937,500 founder shares. (3) Includes 250,000 representative shares to be issued to the underwriter upon consummation of this offering. Exercisability Each warrant is exercisable to purchase one share of our common stock. Exercise price $11.50 per share, subject to adjustment as described in this prospectus. No public warrants will be exercisable for cash unless we have an effective and current registration statement covering the issuance of the common stock issuable upon exercise of the warrants and a current prospectus relating to such common stock. It is our current intention to have an effective and current registration statement covering the issuance of the common stock issuable upon exercise of the warrants and a current prospectus relating to such common stock in effect promptly following consummation of an initial business combination. Notwithstanding the foregoing, if a registration statement covering the issuance of the common stock issuable upon exercise of the public warrants is not effective within 90 days following the consummation of our initial business combination, public warrant holders may, until such time as there is such an effective registration statement and during any period when we shall have failed to maintain such an effective registration statement, exercise warrants on a cashless basis pursuant to an available exemption from registration under the Securities Act. In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of common stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value by (y) the fair market value. The fair market value for this purpose shall mean the average reported last sale price of the common stock for the 10 trading days ending on the trading day prior to the date of exercise. For example, if a holder held 150 warrants and the fair market value on the trading date prior to exercise was $15.00, that holder would receive 35 shares without the payment of any additional cash consideration. If an exemption from registration is not available, holders will not be able to exercise their warrants on a cashless basis. 9 In addition, if (x) we issue additional shares of common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our initial shareholders or their affiliates, without taking into account any founders shares held by our initial shareholders or such affiliates, as applicable, prior to such issuance) (the Newly Issued Price ), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our common stock during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the Market Value ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price described below under Redemption of warrants will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. Exercise period The warrants will become exercisable on the later of: 30 days after the completion of our initial business combination, or 12 months from the closing of this offering; provided in each case that we have an effective registration statement under the Securities Act covering the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to them is available (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). We are not registering the shares of common stock issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable, but in no event later than 30 business days after the closing of our initial business combination, we will use our reasonable best efforts to file, and within 90 business days following our initial business combination to have declared effective, a registration statement covering the shares of common stock issuable upon exercise of the warrants, to maintain a current prospectus relating to those shares of common stock until the warrants expire or are redeemed; provided, that if our common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, but we will be required to use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. 10 The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption of warrants We may redeem the outstanding warrants in whole and not in part, at a price of $0.01 per warrant at any time after the warrants become exercisable, upon a minimum of 30 days prior written notice of redemption, if, and only if, the last sales price of our shares of common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations) for any 20 trading days within a 30 trading day period commencing at any time after the warrants become exercisable and ending three business days before we send the notice of redemption; and if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying such warrants. If the foregoing conditions are satisfied and we issue a notice of redemption, each warrant holder can exercise his, her or its warrant prior to the scheduled redemption date. However, the price of the shares of common stock may fall below the $18.00 trigger price as well as the $11.50 warrant exercise price after the redemption notice is issued. If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of common stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value shall mean the average reported last sale price of the shares of common stock for the ten trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. We will not redeem the warrants unless a registration statement under the Securities Act covering the shares of common stock issuable upon exercise of the warrants is effective and a current prospectus relating to those shares of common stock is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. We will use our best efforts to register or qualify such shares of common stock under the blue sky laws of the state of residence in those states in which the warrants were offered by us in this offering. If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In determining whether to require all holders to exercise their warrants on a cashless basis, our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our stockholders of issuing the maximum number of shares of common stock issuable upon the exercise of our warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of common stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied by the excess of the fair market value (defined below) over the exercise price of the warrants by (y) the fair market value. The fair market value shall mean the average last reported sale price of the common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Please see the section of this prospectus entitled Description of Securities Redeemable Warrants Public Warrants for additional information. 11 Founder shares On June 30, 2021, our sponsor acquired 8,625,000 founder shares (pre reverse split) for an aggregate purchase price of $25,000. On January 24, 2022, to provide for the reduced offering size from $300,000,000 to $250,000,000, we effectuated a reverse split of our issued and outstanding common stock on the basis of 1 share for each 1.2 shares outstanding, resulting in the reduction of founder shares to 7,187,500 shares. In August 2021 our sponsor sold 41,667 shares to Ali Ijaz Ahmad and Sanjay Vatsa, 37,500 shares to Alexander C. Booth, and 29,167 shares to Sara Villarreal on a split-adjusted basis. In September 2021 our sponsor sold 41,667 split-adjusted shares to each of Dr. Amin Badr-El-Din and Amlan Baijal. In October 2021 our sponsor sold 37,880 shares to Dr. Kristina Johnson, 75,759 shares to Gregan LLC, an affiliate of Sutton Ventures, LLC, and 41,667 shares to Michael Bowling on a split-adjusted basis. In the sales to directors and officers, the sales price was approximately the same as the sponsor paid for the shares. In addition, at IPO, the sponsor will transfer to each above-named director, officer and unaffiliated investor a number of private placement warrants from the Makara Strategic Sponsor, Inc. private placement equal to half the number of founder shares each purchased. Prior to the initial investment in the company of $25,000 by our sponsor, the company had no assets, tangible or intangible. The per share purchase price of the founder shares was determined by dividing the amount of cash contributed to the company by the aggregate number of founder shares issued less the required forfeiture of 937,500 founder shares assuming no exercise of the overallotment option by the underwriter. The number of founder shares issued was determined based on the expectation that the founder shares would represent 20% of the outstanding shares (excluding the representative shares) after this offering. As such, our initial stockholders will collectively own 20% of our issued and outstanding shares (excluding the representative shares) after this offering (assuming they do not purchase any units in this offering). If we increase or decrease the size of the offering, we will effect a stock dividend or share contribution back to capital, as applicable, with respect to our common stock immediately prior to the consummation of this offering in such amount as to maintain the ownership of our initial stockholders prior to this offering at 20% of the issued and outstanding shares of our common stock (excluding the representative shares) upon the consummation of this offering. Up to 937,500 founder shares will be subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised so that our initial stockholders will maintain ownership of 20% of our common stock (excluding the representative shares) after this offering. The founder shares are identical to the shares of common stock included in the units being sold in this offering, except that: the founder shares are subject to certain transfer restrictions, as described in more detail below; our sponsor, officers, directors and initial stockholders have entered into a letter agreement with us, pursuant to which they have agreed (i) to waive their redemption rights with respect to any founder shares and any public shares held by them in connection with the completion of our initial business combination, (ii) waive their redemption rights with respect to their founder shares and public shares in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus) or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity and (iii) to waive their rights to liquidating distributions from the trust account with respect to any founder shares held by them if we fail to complete our initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus), although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame. If we submit our initial business combination to our stockholders for a vote, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination; 12 Our sponsor, officers, directors and initial stockholders have agreed to vote any founder shares held by them and any public shares purchased during or after this offering in favor of our initial business combination. As a result, in addition to their founder shares, we would need 9,500,001, or 37.6%, of the sum of (i) the 25,000,000 public shares sold in this offering and (ii) the 250,000 representative shares to be voted in favor of a transaction (assuming only the minimum number of shares representing a quorum are voted and the over-allotment option is not exercised) in order to have our initial business combination approved; and the founder shares are subject to registration rights. Transfer restrictions on founder shares and private placement warrants Our sponsor, directors, officers and initial stockholders have agreed not to transfer, assign or sell for a period ending on the one-year anniversary of the date of the consummation of our initial business combination, or earlier, if, subsequent to our initial business combination, we complete a liquidation, merger, capital stock exchange or other similar transaction that results in all of our public stockholders having the right to exchange their shares of common stock for cash, securities or other property (except as described herein under the section of this prospectus entitled "Principal Stockholders — Restrictions on Transfers of Founder Shares and Private Placement Warrants"). We refer to such transfer restrictions throughout this prospectus as the "lock-up". Voting Each share of common stock will have one vote on all such matters. However, the holders of the founder shares have the right to elect all of our directors prior to our initial business combination. Private placement warrants Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 11,370,000 private placement warrants (or 12,682,500 if the underwriters over-allotment option is exercised in full), each exercisable to purchase one share of our common stock at $11.50 per share, at a price of $1.00 per share ($11,370,000 in the aggregate or $12,682,500 in the aggregate if the underwriters over-allotment option is exercised in full) in a private placement that will occur simultaneously with the closing of this offering. Each private warrant is identical to the warrants sold in this offering, subject to limited exceptions. Each private placement warrant is exercisable for one share of our common stock at $11.50 per share. A portion of the purchase price of the private placement warrants will be added to the proceeds from this offering to be held in the trust account such that at the time of closing $256,250,000 (or $294,687,500 if the underwriters exercise their over-allotment option in full) will be held in the trust account. If we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus), the proceeds from the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares (subject to the requirements of applicable law) and the private placement warrants will expire worthless. 13 Transfer restrictions on private placement warrants The private placement warrants will not be transferable, assignable or salable until the completion of our initial business combination (except as described under the section of this prospectus entitled Principal Stockholders Restrictions on Transfers of Founder Shares and Private Placement Warrants ). However, if after the initial business combination there is a transaction whereby all the outstanding shares are exchanged or redeemed for cash or another issuer's shares, then the private placement warrants (or shares of common stock thereunder) shall be permitted to come out of escrow to participate. Proceeds to be held in trust account The rules of Nasdaq provide that at least 90% of the gross proceeds from this offering and the sale of the private placement warrants be deposited in a trust account. Of the net proceeds of this offering and the sale of the private placement warrants, $256,250,000, or $10.25 per unit ($294,687,500, or $10.25 per unit, if the underwriters over-allotment option is exercised in full) will be placed into a U.S.-based trust account at Bank of America, N.A., with Continental Stock Transfer & Trust Company acting as trustee. These proceeds include $8,750,000 (or $10,062,500 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our tax obligations, the proceeds from this offering and the sale of the private placement warrants that are deposited in the trust account will not be released from the trust account until the earliest of (a) the completion of our initial business combination, (b) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus) or (ii) with respect to any other provision relating to stockholders rights or pre-initial business combination activity and (c) the redemption of our public shares if we are unable to complete our business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus), subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. Anticipated expenses and funding sources Except as described above with respect to the payment of taxes, unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. The proceeds held in the trust account will be invested only in U.S. government securities with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. We will disclose in each quarterly and annual report filed with the SEC prior to our initial business combination whether the proceeds deposited in the trust account are invested in U.S. government treasury obligations or money market funds or a combination thereof. Based upon an assumed interest rate of 0.01%, we expect the trust account to generate approximately $26,000 of interest annually. 14 Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement warrants not held in the trust account, which will be approximately $1,948,000 in working capital after the payment of approximately $672,000 in expenses relating to this offering; and any loans or additional investments from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation to advance funds or invest in us, and provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of our initial business combination. Conditions to completing our initial business combination There is no limitation on our ability to raise funds privately or through loans in connection with our initial business combination. Our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of our assets held in the trust account (excluding the deferred underwriting commissions and interest income earned on the trust account that is released to pay taxes) at the time of the agreement to enter into the initial business combination. If our board is not able to independently determine the fair market value of the target business or businesses or we are considering an initial business combination with an affiliated entity, we will obtain an opinion from an independent investment banking firm that is a member of FINRA or an independent accounting firm. We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders or for other reasons. However, we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires an interest in the target sufficient for the post-transaction company not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the business combination may collectively own a minority interest in the post business combination company, depending on valuations ascribed to the target and us in the business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test, provided that in the event that the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. 15 Permitted purchases of public shares by our affiliates If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our initial stockholders, directors, officers or their affiliates may purchase shares in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. There is no limit on the number of shares our sponsor, directors, officers or their affiliates may purchase in such transactions, subject to compliance with applicable law and the rules of Nasdaq. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Securities Exchange Act of 1934, as amended, or the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Redemption rights for public stockholders upon completion of our initial business combination We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.25 per public share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares held by them and any public shares they may acquire during or after this offering in connection with the completion of our business combination or otherwise and to waive their redemption rights with respect to their founder shares and public shares in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus) or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity. 16 Manner of conducting redemptions We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a stockholder meeting called to approve the business combination or (ii) by means of a tender offer. The decision as to whether we will seek stockholder approval of a
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires: references to amended and restated memorandum and articles of association are to the amended and restated memorandum and articles of association that we will adopt prior to the consummation of this offering; references to we, us or our company are to Bombax Healthcare Acquisition Corporation, a Cayman Islands exempted company; references to China are to the People s Republic of China, including for these purposes Hong Kong and Macao; references to the Companies Act are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; references to founder shares are to the 1,437,500 Class B ordinary shares currently held by the initial shareholders (as defined below), which include up to an aggregate of 187,500 Class B ordinary shares subject to forfeiture by our initial shareholders to the extent that the underwriter s over-allotment option is not exercised in full or in part, and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination as described herein (for the avoidance of doubt, such Class A ordinary shares which are converted from Class B ordinary shares will not be public shares ); references to our initial shareholders are to our sponsors and any other holder of founder shares, including our officers and directors; references to ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; references to our management or our management team are to our officers and directors; references to our private warrants are to the warrants that our sponsors are purchasing privately from us in a private placement concurrent with the closing of this offering, as well as warrants issued upon conversion of working capital loans, if any; references to our public shares are to Class A ordinary shares which are being sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and references to public shareholders refer to the holders of our public shares, including our initial shareholders to the extent our initial shareholders purchase public shares, provided that their status as public shareholders shall exist only with respect to such public shares; references to our public warrants are to the redeemable warrants sold as part of the units in this offering (whether they are subscribed for in this offering or in the open market); references to the representative are to JonesTrading Institutional Services LLC; references to our sponsors are to Bombax Capital Partners Limited, a Cayman Islands exempted company, and Be Expert Limited, a British Virgin Islands company; and references to our warrants are to the public warrants as well as the private warrants and any warrants issued upon conversion of working capital loans. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any forfeiture of shares, and all references to forfeiture of shares, described in this prospectus shall take effect as a surrender of shares for no consideration as a matter of Cayman Islands law. Any share dividend described in this prospectus will take effect as a share capitalization as a matter of Cayman Islands law. 1 Table of Contents All references in this prospectus to our shares being forfeited shall take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. All references in this prospectus to share dividends shall take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriter will not exercise their over-allotment option. You should rely only on the information contained in this prospectus. We have not, and the underwriter have not, authorized anyone to provide you with different information. We are not, and the underwriter is not, making an offer of these securities in any jurisdiction where the offer is not permitted. General We are a blank check company newly incorporated as a Cayman Islands exempted company on June 11, 2021. Exempted companies are Cayman Islands companies wishing to conduct business outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received a tax exemption undertaking from the Cayman Islands government that, in accordance with section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations shall apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax shall be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We were incorporated for the purpose of entering into a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or similar business combination with one or more businesses or entities, which we refer to as a target business. Our efforts to identify a prospective target business will not be limited to a particular industry or geographic location (excluding China), although we currently intend to focus our efforts on identifying a prospective target business in the healthcare industry or a healthcare-related sector that can benefit from the expertise and capabilities of our management team to create long-term shareholder value. We will not undertake an initial business combination with any entity that is based or located in or that conducts its principal business operations in China (including Hong Kong and Macau). We do not have any specific business combination under consideration and we have not (nor has anyone on our behalf), directly or indirectly, contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to such a transaction with our company. We intend to leverage our deep understanding and extensive network in privately held companies to identify businesses with focus in healthcare or healthcare-related sectors. We believe there has been an increasing number of underrepresented private healthcare companies that are ready to go public but have for now chosen to remain private due to the abundant capital availability in the private markets, which provides vast potential business combination opportunities for us. We intend to seek proprietary and unique targets that can benefit from markets underpinned by strong and rapid growth. We are not required to complete our initial business combination with a healthcare business and may pursue a business combination target in any business or industry. Business Strategy Our business strategy is to identify potential business combination targets in the healthcare industry which are public market ready and exhibit strong potential and management. We intend to leverage our management team s network and experience, and focus on businesses that can benefit from our management s expertise. We believe our management team s experience and knowledge can enable us to explore and realize the potential of businesses that have a high degree of complexity in product nature, legal, regulations, and capital structures. We believe that our collective experiences from public and private investments, industry and operational experiences, deal making and evaluation track record, network of capital providers, and awareness of risk management and regulatory considerations provide us with a strong platform to identify and consummate an initial business combination successfully. Our mission is to 2 Table of Contents deliver shareholder value through an active engagement plan to private enterprises as they enter the public markets. The key drivers of our value creation approach leverage the distinctive combination of experiences from our sponsors, management team and board of directors: Deal sourcing network: Our extensive network of relationships and our sponsors exposure, particularly from Integrated Capital, a Hong Kong-based multi-strategy private investment firm, to proprietary investments, is the foundation for quality deal-sourcing with a differentiated pipeline of attractive acquisition opportunities that other companies may have difficulties replicating. Our potential targets may include businesses owned or affiliated, or which have longstanding relationships with our management. Industry Expertise: Our extensive industry knowledge within the areas of focus will allow us to identify potential targets with a strong competitive position for our initial business combination team effectively and efficiently. This extensive domain expertise from a combination of industry practitioners and executives has a meaningful impact on both how we identify sound businesses with strong growth potential and subsequently make investment decisions. Deal Evaluation and Execution: Professional value, risk assessment and evaluation of public market readiness will be priorities in our deal evaluation process. Our team has many years of combined experience in deal sourcing, deal evaluation, due diligence, and private and public market investments. We will approach our deal evaluation stage with detailed qualitative and quantitative analyses, including top-down industry analysis, competitive benchmarking, bottom-up financial modelling, sensitivity analyses, and listed company comparable and precedents. We believe that due diligence is critical to this stage and we will conduct thorough due diligence of the business including but not limited to commercial, financials and accounting, tax and deal structuring, legal and regulatory, and information technology. We will place emphasis on identifying potential risks and evaluate levels of uncertainty and may employ an external consultant to provide objective advice on the due diligence process. Capital Structure: We believe in achieving long-term shareholder value creation through optimal corporate finance structuring and our access to capital markets. Existing sound businesses with reasonable valuations may still benefit substantially from optimizing their capital structure or even operational efficiencies to enhance their compounding growth. Market Engagement: We will assist the development of capital market engagement strategies to ensure the target company s value is fully reflected in the public market. Our management team and board of directors have cultivated a strong understanding of key value levers across multiple market cycles, as well as deep strategic and operational domain expertise in areas related to healthcare. Our partnership approach will focus on working with target companies existing management to devise ways to improve strategic positioning and operational performance, resulting in enhanced growth and profitability. We also have vast experience guiding companies on their transparency, governance, and public market narrative. Following the completion of this offering, we intend to begin the process of communicating with the network of relationships of our investment team and their affiliates to articulate the parameters for our search for a potential target for our initial business combination and begin the process of pursuing and reviewing potential opportunities. Business Combination Criteria Consistent with our strategy, we have identified the following high-level and non-exclusive attributes and guidelines which we believe are important in evaluating prospective target businesses. We will use these criteria in evaluating acquisition opportunities and will initially target businesses with enterprise values of approximately US$200 million to US$500 million, although we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines should a suitable opportunity arises. Underpenetrated disruptive companies with favorable business dynamics. We intend to actively look for suitable businesses operating in the healthcare industry or providing healthcare-related services. These market segments are innovative, disruptive in nature, and offer compelling long-term risk-adjusted return profiles. 3 Table of Contents Healthcare targets that would benefit from being publicly traded. We intend to only acquire businesses that would benefit from being publicly traded in the United States, including access to broader sources of capital and expanded market awareness. We believe such access would allow the target business to accelerate its growth and enhance its ability to pursue accretive acquisitions and high-return capital projects. Experienced, motivated and public market ready management team. We intend to focus on companies with a visionary, experienced and professional management team that has demonstrated a track record of driving growth, strategic decision making and long-term value creation. We may seek to selectively supplement the existing management team of the business with members of our management team or with other proven leaders from our network. Healthcare businesses with unique market positioning and compelling growth potential. We plan to target businesses with unique positioning and customer appeal. We believe businesses with distinguished core values that appeal to a global market can thrive under changing macro-economic environments. We intend to look for one or more businesses that have multiple growth levers that could provide additional revenue streams and monetization potential. Market leadership with sustainable competitive advantage. We intend to focus on companies that are category leaders in their respective verticals. The characteristics of these companies include but are not limited to leading technology or product and distribution capabilities, strong brand recognition, and high barriers to entry, which would ultimately allow them to create and capture long-term value in the marketplace. We believe that we provide an attractive alternative investment opportunity that capitalizes on key trends impacting the capital markets for the healthcare sector. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. Our Management Team We will utilize our strong partnership of industry experts and public and private investors to drive superior results from multi-disciplinary investment and risk management processes. Our engaged partners will provide strategic directions and help target the transition to public market to ensure synergistic effects post-merger. We believe this holistic approach with focused mindset positions us as a differentiated and robust partner to private enterprises as they journey into the public market. Gary Chan, our Chief Executive Officer and Director, is the founder of CFO (HK) Limited, also known as CFO Centre in Hong Kong and China, and has been serving as its chief executive officer of Greater China since 2014. He was the corporate finance director for TNG (Asia) Limited, a Hong Kong based FinTech company, from 2015 to 2017. He led the company s corporate finance exercise and the successful application of the Stored Value Facility (SVF) license granted by the Hong Kong Monetary Authority (HKMA). Before he joined TNG (Asia) Limited, Mr. Chan was a partner at Creat Capital Company Limited, an investment fund that focused on cross-border private equity opportunities between China and the rest of the world under a joint venture with RIT Capital Partners plc, from 2009 to 2013. From 2007 to 2009, he was in Goldman Sachs fixed income team in Hong Kong specializing in private investments across Asia. Mr. Chan worked on Deloitte s restructuring and corporate finance teams in Hong Kong from 2001 to 2007. He started his career with KPMG in Canada in 1998, where he practiced accounting and auditing in its real estate division. Mr. Chan is currently an independent non-executive director at LHN Group (HKEX:1730; SGX:410) and a director of each of True Yoga Holdings Limited and E&E Consulting Limited. He is also the chief executive officer of Pomona Acquisition Limited (Nasdaq: PMAC), a SPAC formed for the purpose of acquiring a target in the FinTech sector, which is currently seeking to be listed on Nasdaq, and the director of Pomona Acquisition LLC, sponsor to Pomona Acquisition Limited. He was a director of TOMO Holdings Limited from June 2017 to June 2021. Mr. Chan obtained his bachelor s degree in mathematics and a master s degree in accounting, both from the University of Waterloo. He obtained his Chartered Accountant designation in Canada in 2000. Kelvin Sze, our Chief Financial Officer and Chairman, is currently the chief financial officer of Pomona Acquisition Limited (Nasdaq: PMAC), a SPAC formed for the purpose of acquiring a target in the FinTech sector, which is currently seeking to be listed on Nasdaq. He has approximately 18 years of experience in asset management, hedge 4 Table of Contents funds and leading investment banks across various investment products in global markets. He was most recently head of macro-trading in Hong Kong at Barclays, where he also served as an executive officer for the Hong Kong Monetary Authority regulated activities, managing the bank s offshore North Asian emerging markets trading businesses, from 2015 to 2021. From 2013 to 2015, he managed the Asia macro fund for Trinitus Asset Management in Hong Kong, trading primarily currency and interest rate derivatives, corporate cash bonds, and equity derivatives. Before Trinitus, Mr. Sze was a market maker at Bank of America s and Merrill Lynch s emerging market fixed-income, currencies and interest rate derivatives in Hong Kong and New York from 2007 to 2013. He started his career at BlackRock in 2003 as an investment analyst, where he was responsible for portfolio analytics, market risk management, and quantitative investment strategies in alternative investments in New York. Mr. Sze is also a director of several investment holding companies which have no current business activities, including Power Wealth Development Limited and EFFIONE, Inc. Mr. Sze holds a Bachelor of Science degree in Operations Research and Industrial Engineering from Cornell University and is a Chartered Financial Analyst (CFA) charterholder. He is also a member of Central4Change, a nonprofit organization focused on empowering local youth in Hong Kong. Dr. Hoon K. Lee serves as our Independent Director. Dr. Lee is a radiation oncologist in Staten Island, New York, who has been in practice for over 17 years. He is the recipient of the Gilbert H. Fletcher Award, the Thomas Barkley Award, and the Jay and Lori Eisenberg Endowed Fellowship at the M.D. Anderson Cancer Center. He is also a recipient of the Roentgen Research Award from the Radiological Society of North America. He has presented at international and national conferences such as the Radiation Therapy Oncology Group, American Radium Society, American Society for Therapeutic Radiology and Oncology, American Society of Clinical Oncology Prostate Cancer Symposium, and the Radiological Society of North America. From 2006 to 2010, Dr. Lee served on the American College of Radiology Appropriateness Criteria Expert Panel on radiation oncology lung work group. He served as guest reviewer for the journal of International Journal of Radiation Oncology, Biology, Physics from 2002 to 2014. He is board-certified in radiation oncology by the American College of Radiology, and is on the medical staff at Richmond University Medical Center in New York (RUMC). Prior to joining RUMC, Dr. Lee was employed at Regional Imaging & Therapeutic Radiology Services, P.C. Staten Island (Regional Radiology) as a radiation oncologist from 2004 to 2016. From 2007 to 2020, Dr. Lee was also a general partner of Regional Bard Realty, an entity which owned the real estate where Regional Radiology practiced. Dr. Lee is also board-certified in Radiation Oncology by the American Board of Radiology. He is also a member of the American Medical Association, American Society of Clinical Oncology, and American Society for Radiation Oncology. Dr. Lee earned his Bachelor of Arts in molecular and cell biology with honors from the University of California at Berkeley. He obtained his medical doctorate from the George Washington University School of Medicine in 1999. He completed his residency at the University of Texas, M.D. Anderson Cancer Center. He completed his training in radiation oncology at The University of Texas M.D. Anderson Cancer Center in 2004. Louis S. Villalba serves as our Independent Director. Mr. Villalba has more than 25 years of industry experience in developing and commercializing innovative therapie. Mr. Villalba is the chief executive officer of Genea Biomedx, which is part of the fertility group Genea and focuses on developing fertility technologies, since 2018. Mr. Villalba was previously with OvaScience from 2015 to 2018, where he served as executive vice president of the corporate development and successfully managed the firm s exit into a reverse merger. Prior to OvaScience, Mr. Villalba was chief business officer at Evofem from 2014 to 2015, global vice president of sales at Auxogyn from 2013 to 2014 and executive vice president of Europe for Conceptus from 2004 to 2013 where he was part of the team that completed the $1.1B sale of the company to Bayer AG. Mr. Villalba holds a Bachelor of Science in Business Management from Menlo College. Ka Yin Norma Chu serves as our Independent Director. Ms. Chu is the founder and has served as chairwoman of the board and chief executive officer of DDC Enterprise Limited since its inception in 2012. DDC Enterprise Limited is a digital publisher and merchandiser company running the brand DayDayCook, a leading content-driven lifestyle and culinary brand in China. DayDayCook has a vision to satisfy today s young female gen z consumers who aspire to have a better lifestyle by providing a modern 360-degree cooking experience to them. DayDayCook is now the largest cooking and lifestyle content platform in China and has three experience centers nationwide. Before founding DayDayCook, Ms. Chu served as head of research of HSBC Private Bank in Hong Kong from July 2010 to May 2012. Ms. Chu is the co-founder of FoundersHK in 2020, the president of Greater Bay Young Entrepreneurship Association and the founder of Good Food Movement in 2018, a charity organization providing genuine inspiration about healthy food source. She is also a board member of YPO North Asia Regional and a board member of Hong Kong Shanghai Youth Association, as well as a standing director of Shanghai Hong Kong Association. Ms. Chu has also been elected as a member of the Technology and Innovation Subsector of the Election Committee of Hong Kong SAR for 2021. Ms. Chu received her Bachelor of Arts degree in the University of Washington in 2004. 5 Table of Contents The past performance of our management team or of their affiliates is not a guarantee either (i) that we will be able to identify a suitable candidate for our initial business combination or (ii) of success with respect to any business combination we may consummate. You should not rely on the historical record of our management team s or their affiliates performance as indicative of our future performance. Initial Business Combination We will have until 12 months from the closing of this offering to consummate our initial business combination. However, if we anticipate that we may not be able to consummate our initial business combination within 12 months, we may, but are not obligated to, extend the period of time to consummate a business combination four times by an additional three months each time for a total of up to 24 months to complete a business combination. In this situation, public shareholders will not be offered the opportunity to vote on or redeem their shares if we choose to make such extension. Pursuant to the terms of our amended and restated memorandum and articles of association and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order to extend the time available for us to consummate our initial business combination, our insiders or their affiliates or designees, upon five days advance notice prior to the applicable deadline, must deposit into the trust account for each three month extension $250,000, or $287,500 if the underwriters over-allotment option is exercised in full ($0.05 per share in either case), on or prior to the date of the applicable deadline. The insiders will receive a non-interest bearing, unsecured promissory note equal to the amount of any such deposit that will not be repaid in the event that we are unable to close a business combination unless there are funds available outside the trust account to do so. Such notes would either be paid upon consummation of our initial business combination, or, at the lender s discretion, converted upon consummation of our business combination into additional private warrants at a price of $1.00 per warrant. Our shareholders have approved the issuance of the private warrants upon conversion of such notes, to the extent the holder wishes to so convert such notes at the time of the consummation of our initial business combination. We intend to issue a press release the day after the applicable deadline announcing whether or not the funds had been timely deposited. Our insiders and their affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. To the extent that some, but not all, of our insiders, decide to extend the period of time to consummate our initial business combination, such insiders (or their affiliates or designees) may deposit the entire amount required. Any notes issued pursuant to these loans would be in addition to any notes issued pursuant to working capital loans made to us. If, however, we have executed a letter of intent, agreement in principle or definitive agreement for our initial business combination within 12 months from the closing of this offering but have not completed our initial business combination within such 12-month period, we may choose to extend the period of time to consummate a business combination by an additional three months at no cost to the sponsor. If we are unable to consummate our initial business combination within the time period described above, we will, as promptly as reasonably possible but not more than five business days thereafter, redeem the public shares for a pro rata portion of the funds held in the trust account and as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. In such event, the warrants will be worthless. Nasdaq rules provide that our initial business combination must be with one or more target businesses that together have a fair market value equal to at least 80% of the balance in the trust account (less any taxes payable on interest earned) at the time of our signing a definitive agreement in connection with our initial business combination. If our board is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions with respect to the satisfaction of such criteria. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% fair market value test. If the business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the target businesses. If our securities are not listed on Nasdaq after this offering, we would not be required to satisfy the 80% requirement. However, we intend to satisfy the 80% requirement even if our securities are not listed on Nasdaq at the time of our initial business combination. 6 Table of Contents We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act . Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity securities of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsors, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsors, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions that our initial business combination is fair to our company (or shareholders) from a financial point of view. Members of our management team and our independent directors and their affiliates will directly or indirectly own ordinary shares and private warrants following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Additionally, each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to another entity, including other blank check companies similar to our company, pursuant to which such officer or director may be required to present a business combination opportunity to such entity, subject to their fiduciary duties under Cayman Islands law. Specifically, our executive officers are affiliated with entities that make, or are looking to make, investments in companies. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has fiduciary or contractual obligations, he or she may honor his or her fiduciary or contractual obligations to present such business combination opportunity to such entity, subject to their fiduciary duties under Cayman Islands law. We do not believe, however, that the fiduciary duties or contractual obligations of our executive officers will materially affect our ability to complete our business combination. For additional information regarding our executive officers and directors business affiliations and potential conflicts of interest, see Management Directors and Executive Officers and Management Conflicts of Interest. Our amended and restated memorandum and articles of association will provide that, to the fullest extent permitted by applicable law, we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue. Private Placements Prior to this offering, we issued an aggregate of 1,437,500 founder shares (up to 187,500 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised) to our initial shareholders for an aggregate purchase price of $25,000, or approximately $0.017 per share. None of our initial shareholders has indicated any intention to purchase units in this offering. Subject to certain limited exceptions, our initial shareholders have agreed not to transfer, assign or sell their founder shares (except to certain permitted transferees) until one year after the date of the consummation of our initial business combination. Any permitted transferees will be subject to the same restrictions and other agreements of our initial shareholders with respect to any founder shares. We refer to such transfer restrictions throughout this prospectus as the lock-up. 7 Table of Contents Notwithstanding the foregoing, if the closing price of our Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share subdivisions, dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, the founder shares will be automatically released from the lock-up. Our initial shareholders have agreed to purchase an aggregate of 3,500,000 warrants (or 3,800,000 warrants if the over-allotment option is exercised in full) at a price of $1.00 per warrant for an aggregate purchase price of $3,500,000 (or $3,800,000 if the over-allotment option is exercised in full) in a private placement that will occur simultaneously with the closing of this offering. Subject to certain limited exceptions, our initial shareholders have agreed not to transfer, assign or sell any of the private warrants and underlying Class A ordinary shares until 30 days after the completion of our initial business combination. Corporate Information We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor internal controls attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company for up to five years. However, if our non-convertible debt issued within a three year period or revenues exceeds $1.07 billion, or the market value of our shares that are held by non-affiliates exceeds $700 million on the last day of the second fiscal quarter of any given fiscal year, we would cease to be an emerging growth company as of the following fiscal year. Our executive offices are located at 221 Henderson Road, #01-05 Henderson Road, Singapore 159557, and our telephone number is +65 67335763. 8 Table of Contents
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: common stock are to our Class A common stock and our Class B common stock, collectively; founder shares are to shares of our Class B common stock held by our initial stockholders prior to this offering, and the shares of our Class A common stock issued upon the conversion thereof as provided herein; initial stockholders are to our sponsor and any other holders of our founder shares prior to this offering (or their permitted transferees); management or our management team are to our officers and directors; private placement units are to the units being purchased by our sponsor, with each placement unit consisting of one placement share and one private placement warrant; private placement shares are to the shares of our Class A common stock included within the private placement units being purchased by our sponsor in the private placement; private placement warrants are to the warrants included within the private placement units being purchased by our sponsor in the private placement; private placement are to the private placement of 451,000 private placement units (up to 496,000 private placement units if the underwriters over-allotment option is exercised in full) at a price of $10.00 per unit, for an aggregate purchase price of $4,510,000 (up to $4,960,000 if the underwriters over-allotment option is exercised in full), which will occur simultaneously with the completion of this offering; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our initial stockholders and members of our management team to the extent our initial stockholders and/or members of our management team purchase public shares; provided that each initial stockholder s and member of our management team s status as a public stockholder shall only exist with respect to such public shares; public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); representative are to EF Hutton, division of Benchmark Investments LLC, the representative of the underwriters in this offering; representative shares refers to the 250,000 shares of Class A common stock (287,500 shares of Class A common stock if the underwriters over-allotment option is exercised in full) to be issued as compensation to the representative and/or its designees; sponsor are to Namaste World Sponsor LLC, a Delaware limited liability company; Suresh Guduru, our Chief Executive Officer and director is the managing member of our sponsor; 1 Table of Contents trust account are to the trust account in the United States at J.P. Morgan Chase Bank, N.A., with Continental Stock Transfer & Trust Company acting as trustee, into which we will deposit certain proceeds from this offering and the sale of the private placement units; warrants are to our redeemable warrants, which includes the public warrants as well as the private placement warrants; and we, us, Company or our company are to Namaste World Acquisition Corporation. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. 2 Table of Contents General We are a newly organized blank check company incorporated as a Delaware corporation formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. To date, our efforts have been limited to organizational activities as well as activities related to this offering. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. We have generated no operating revenues to date and we may not generate operating revenues even after we consummate our initial business combination. While we may pursue an acquisition opportunity in any business, industry, sector or geographical location, we intend to focus on industries that complement our management team s background, and to capitalize on the ability of our management team and strategic advisor to identify and acquire a business. While we search for a target in the of TMT and technology-empowered consumer sectors, where our management team and strategic advisor have extensive experience, we place additional emphasis on technology driven, disruptive and high growth companies that focus fundamentally on rapidly evolving consumer behavior, new platforms and methodologies influencing consumption, differentiating intellectual property, early adoption by the market, innovations in artificial intelligence to further drive value and expansion, and transforming traditional business models to improve quality of life with efficiency. We believe this criteria is well-suited for a special purpose acquisition company (the SPAC ) vehicle of our size given that companies of our target size in these industries are at an inflection point in their life cycle where they are poised for a large investment with a strategic capital partner and entry into the public markets. Our assessments of target companies are not merely theoretical, from traditional, detached investors, but rather formed from a hands-on group that deeply understands the market, the opportunity, and how to transform a target company with new investment. Our team brings a set of experiences and hands-on capabilities that other, higher profile investors may not have. We believe that the combined experience of our team and our differentiated long-term strategy position us as an optimal partner for companies seeking to access the public markets. Most of our risk capital comes from our management team which demonstrates the confidence of the team and align their interests with those of our investors. We believe this will also align our management team with the investors and management team of our eventual target company. We believe that SPACs that are led or co-led by operators rather than solely by investors tend to outperform throughout the deal cycle, and that are led by a team of both investors and operators tend to perform even better. Core members of our management team are operators that have chosen to work with us, and to invest in our risk capital, because we offer them the chance to leverage their skills and expertise for the benefit of our eventual target company. 3 Table of Contents Our Management Team Our management team, led by our Chief Executive Officer and Chairman, Suresh Guduru, comprises seasoned entrepreneurs and business operators. Our management team and strategic advisor consist of seasoned investors and industry executives with an extensive track record of identifying, investing in, building, operating, and advising businesses with innovative, disruptive, and high-growth business practices. They each have recognized successes in various sectors with a broad range that includes Advanced Technology, Healthcare, Real-estate, Film and Media, Hospitality, Food, Aviation, Retail, and Wholesale. Each one has successfully built businesses from scratch and/or taken over existing businesses and expanded them with excellent growth and profitability from disciplined management practices demonstrated over many years. In addition to Mr. Guduru, upon effectiveness of the registration statement of which this prospectus forms a part, our management team will consist of Kishore Kondragunta, Suresh Singamsetty, Rana Gujral, Kyle I. Parent, and Warren Weiner. We believe that our strong management team, coupled with the experience and expertise of our strategic advisor, will propel the company to identify a valuable acquisition target that can thrive in a public-listing environment. Suresh Guduru, our Chief Executive Officer and Chairman, has been in the hospitality, production, distribution, wholesale, and retail of specialty foods industries for over 23 years and currently owns and operates several retail stores, restaurants, wholesale centers, and production facilities across the US. He also owns a technology company specializing in mobile and artificial intelligence. In addition, Mr. Guduru provides advisory services to engineering and technical teams at various high-tech companies in the US. Previously, he held leadership positions in technology and management at Qualcomm and Motorola, working on bringing the latest technologies to the market. He also owns and manages multiple commercial real-estate properties across California and Arizona. Mr. Guduru obtained a Master of Technology degree in 1997 in Computer Science from the University of Hyderabad with special emphasis on Artificial Intelligence and Parallel/Distributed super-computing technologies. Mr. Guduru obtained his Bachelor of Technology in Computer Science and Engineering in 1994 from Nagarjuna University. Suresh Singamsetty, our Chief Financial Officer and director, is currently the CEO of WiSilica Inc., a scalable IoT platform company with over 130 employees, and the CTO of Tracesafe Inc. (CSE: TSF), a publicly listed Canadian company focusing on safety-based wearable technology. Mr. Singamsetty has over 20 years of experience in building innovative and industry leading technology companies. As an innovative entrepreneur, he is actively involved in product conceptualization, product development, capital raises, and business scaling. He is highly respected in the fields of semiconductors and low power wireless networking. Mr. Singamsetty co-founded multiple technology companies, including Transilica Inc., a developer of chips based on Bluetooth technology which was acquired by Microtune Inc. for approximately US$152 million and the Tracesafe self-quarantine solutions which were spun-off from WiSilica and acquired by Tracesafe Inc. Mr. Singamsetty also co-founded Martian Watches, a company manufacturing the first watch to utilize voice command, and Jaalaa, a low power semiconductor company. He is also a co-inventor of over 20 patents across software, wireless and Bluetooth technologies. Mr. Singamsetty graduated with a Master of Computer Science from Indian Institute of Technology, Kanpur. Kishore Kondragunta, our Chief Investment Officer and Secretary, is a seasoned IT executive, investor, and business owner. His career has spanned over two decades across multiple Fortune 50 companies. He founded a private equity firm in 2020, Bayshore Investments LLC, where he currently is a member. Mr. Kondragunta also owns and is a member of a real-estate investment company, Bay Realty Investments LLC, which invests in real-estate since 2016. This company has owned and successfully sold multiple multi-million-dollar homes. Mr. Kondragunta is also a member of LobStar Venture LLC, a restaurant, since November 2018. Mr. Kondragunta holds a Bachelor s degree in Mechanical Engineering and a Master s degree in Telecommunications Management from Oklahoma State University, Stillwater, Oklahoma. Rana Gujral, one of our director nominees, is an entrepreneur, speaker, investor, and the CEO at Behavioral Signals, an enterprise software company that excels at distinguishing behavioural signals in speech data with its proprietary deep learning AI technology. As a thought-leader in the AI/technology space, Mr. Gujral often leads plenary and parallel sessions at industry events such as World Government Summit, VOICE Summit, The Next Web Conference, Collision, and Horasis World Economic Forum. His bylines are featured in publications such as Hacker Noon, Voicebot.ai, SpeechTechMagazine, and is a contributing columnist at TechCrunch and Forbes. Mr. Gujral has been recognized as an AI Entrepreneur to Watch in Inc. Magazine, Entrepreneur of the Month by CIO Review, awarded US-China Pioneer by IEIE, and listed as a Top 10 Entrepreneur to follow in 2017 by Huffington Post. In 2020, he won Contributor of the Year in Hacker Noon s Noonie s Awards. Mr. Gujral is majority owner of Hackient Inc., a software 4 Table of Contents development company focusing on artificial intelligence and machine learning and has served as a Director of the company since July 2021. He has also served as an Advisor at ActiveScaler Inc., a technology travel services company, since February 2013. In 2014, Mr. Gujral founded TiZE, an ML-based SaaS for specialty chemicals vertical, which was acquired by Alchemy Cloud in 2016. Prior to TiZE, Mr. Gujral led the turnaround for private-equity backed Cricut Inc. (Nasdaq: CRCT), a creative technology platform company dedicated to encouraging new ways for people to experience making at home to millions of users worldwide. At Cricut, he affected the turnaround from bankruptcy to profitability within a short span of two years between May 2012 and September 2014. Previously, Mr. Gujral was a Senior Vice President at Logitech S.A. from April 2018 to August 2018 and Director of Engineering from January 2012 to May 2012. He was also a Principal Software Engineer and Senior Manager of Engineering and Product at Kronos Incorporated from August 2000 to January 2010. Mr. Gujral attended Mahatma Jyotiba Phule (MJP) Rohilkhand University where he obtained a Bachelor of Science in computer science degree in 1997. In 1999, he graduated from TACK International with an Associate of Applied Business in Marketing, and in 2001, Mr. Gujral completed a Managing Technical People and Organizations program from the Sloan School of Management, Massachusetts Institute of Technology. Finally, in 2005, Mr. Gujral obtained his MBA from University of Massachusetts. Kyle I. Parent, one of our director nominees, is currently a Group Vice President of Oracle Applications Labs at Oracle Corp, where he leads an organization of more than 300 software developers, IT specialists, and product managers, responsible for Sales, Marketing, and E-commerce systems for both internal and customer facing applications. Prior to joining Oracle, Mr. Parent served as CEO of Keirsey.com (www.keirsey.com), an online provider of the Keirsey Temperament Sorter and related professional services from 2005 to 2013. He served as a Director of Keirsey.com from 2007 to 2015. He was also the founder and CEO of several venture backed pioneering SaaS companies in the early 2000 s. His first start-up, Pantheon Interactive, Inc., was self-funded and founded in 1996 and sold to IXL, Inc. in 1998, prior to IXL s successful IPO. Prior to founding Pantheon Interactive, Mr. Parent led Electronic Sales and Service at Silicon Graphics, Inc., a public Information Technology company, where he pioneered commercial use of the Internet from 1993 to 1996. He developed one of the first commercial and ecommerce enabled websites in 1993, the award winning Silicon Surf , and was featured as The Webmaster in the 1997 book Digirati: Encounters with the Digital Elite , by John Brockman. Mr. Parent received his Bachelor s degree in Computer Science from the University of California, Berkeley in 1981. Warren Weiner, one of our director nominees, is a seasoned hands-on financial and operations executive with demonstrated results in a variety of financial, operational and business development roles over the past 35 years, primarily in the wireless/telecom and fintech industries. As a co-founder of Pacific Communication Sciences Inc. ( PCSI ), a developer of wireless communications equipment, which was later acquired by Cirrus Logic, Inc., he oversaw the company s growth from zero to $150 million in revenues and a staff of 600 employees including 300 engineers. Mr. Weiner has held CFO and/or other leadership positions at PCSI, Transilica, Inc., a developer of chips based on Bluetooth technology, which was acquired by Microtune Inc., Paratek Microwave Inc., a developer of tunable antenna circuits, which was acquired by Research In Motion Ltd. and Dynamics Inc., a company that designs and manufactures intelligent, battery powered payment cards, among others. Over the course of his career, Mr. Weiner has raised over $170 million private equity and $45 million in debt facilities, and managed five separate M&A exit sales of private companies to publicly traded companies. His business development experience spans OEM, private label, joint ventures and end users with extensive international experience in Europe, Japan, China and India. Mr. Weiner is a CPA and has both a Bachelor s in Economics and a MBA in Finance from the Wharton School of the University of Pennsylvania where he graduated summa cum laude. Our Strategic Advisor We intend to leverage the capabilities of our strategic advisor to assist us with the sourcing and evaluation of potential acquisition candidates. We believe the relationships, experience and expertise of our strategic advisor will provide us with additional access and insight into potential target companies. Anil Sunkara, our strategic advisor, is a diversified and successful entrepreneur for over 25 years. He has created and grown companies in multiple software and technology sectors, produced multiple international films, and experienced consistent success in other industries including breweries, manufacturing, real-estate, and hospitality. Mr. Sunkara has served as the manager of Capitalize Ventures LLC, a real-estate company, since October 2021. Moreover, Mr. Sunkara has been the Chief Executive Officer of AdvanSoft International and their subsidiaries since April 1999. AdvanSoft International and its subsidiaries are located in various regions in the US, primarily focusing on Information Technology- Software Applications, Product Development, Implementations, Staff Augmentation, and Outsourcing services. AdvanSoft International was established in 1998, as a boutique firm in Arlington Heights, IL, and 5 Table of Contents gradually expanded its wings to various locations in the U.S. and India. As the CEO of AdvanSoft International, Anil was an E&Y Entrepreneur of the Year, Finalist 2007, one of the most prestigious awards for any successful entrepreneur. Mr. Sunkara has served as the CEO of TrySecondOpinion, Inc. since May 2021, a health technology platform that connects patients with doctors for second opinions. He is a cofounder and partner of Mall of India in Naperville, Illinois since December 2018, a shopping center. Mr. Sunkara has also severed as COO of SilverXis since December 2014, a software development company that provides outsourcing and recruitment services. Moreover, Mr. Sunkara has been the Managing Director of AK Entertainments, an India integrated film production houses, since May 2010. Under his leadership, AK Entertainments has successfully expanded its film and media division, where Mr. Sunkara produced over 25 movies in popular Indian languages in the last ten years with top box-office stars in the industry, along with its partners. Furthermore, Mr. Sunkara has served as a Producer of 14 Reels Entertainment Pvt Ltd., an entertainment and film distribution company since October 2009. Mr. Sunkara is also a member of the Working Committee of the Telugu Film Producers Guild comprising only 7 top producers of the industry. Furthermore, Mr. Sunkara has served as the Secretary of Usharama College of Engineering since August 2008, a university located in India. Mr. Sunkara also serves as a director of AK Estates since January 2005, a real-estate company. He holds a Master of Science in Computer Science from George Mason University, and a Bachelor of Technology in Electronics and Communications from K L University. Industry While we may pursue a business combination target in any business or industry, we intend to focus our search for a target business in the TMT and technology-empowered consumer, in particular, the technology-driven, disruptive, and high growth companies, which complements the expertise of our management team. The acceptance and pace of disruptive trends across the TMT and consumer sectors, which have further gained rapid momentum given the effects of the global pandemic, has created enormous demand for organizations to transition to technology enabled consumer driven entities to improve quality of life with greater efficiency. This sudden demand in turn has created significant opportunities for companies to innovate and grow. We intend to focus on companies that are sensitive and responsive to the emerging and ever changing consumption behavior and have the talent to innovate and strive to be the leaders. While we pursue businesses with a strong emphasis on invention as well as adoption of technology, we also look for one or more of the following criteria: Proven research and development team with early acceptance in the public domain; Differentiating Machine Learning and AI advantages to create new markets and disrupt existing ones; Special focus on products or solutions to improve quality of life and efficiency; Sector leadership or a well-defined path to sector leadership in the short to medium-term; Established, authentic, and mature customer base with profitable sales channels; Strong record of natural growth with margins along with roadmap to enhance growth and profitability; Recession/pandemic proof supply chain with market advantage; and Respected and talented management teams along with strong mid-level managers with best practices and overall employee satisfaction. We believe that the TMT and technology-empowered consumer sectors, individually and combined, represent attractive target markets with huge business potential, along with a large number of acquisition opportunities. The advancements made in these sectors and their direct impact on the quality of everyday life indicate that there are still enormous opportunities present in these sectors with strong potential for fast paced growth and returns. The recent disruptions caused by the pandemic only highlighted the need and impact of technology enabled consumer services and products. The global demand for technology enabled products and services sectors continues to grow and the focus is rapidly shifting from mere process automation to enhanced intelligence and advanced decision making capabilities in order to improve the quality of life at affordable costs. Our management team has identified the following key indicators that will aid our search for targets in these sectors: Enhanced and augmented intelligence and autonomous agents; Direct impact and improvements to quality of life; 6 Table of Contents Key focus on offering personalized and long-term loyalty building solutions and products; Technology, products, or services to aid and strengthen the businesses around the globe focusing on the latest trends in the consumer behavior; Augmenting the capabilities of enterprises that focus on interacting directly with the end consumer; Solutions to strengthen companies against unforeseen interruptions and challenges; and Emphasis on protecting the planet and social responsibility. Our target sectors are attractive for many investment groups, but our management team has selected them for their investment attractiveness, as well as in those markets where we will have an advantage in both the evaluation stage of companies and then the application of our expertise and insight to help the target companies rapidly scale. We combine long-time industry participation in well-established sectors such as retail, film, healthcare, aviation, real-estate, hospitality, and wholesale distribution. These are large markets where successful participants do not just compete on price or a short-term decision. We understand their place in the market, how to move to a better one, or how to further separate their position from others. Our management team members have all taken part and successfully competed in many of these markets. On top of this, several members of our management team have extensive technology backgrounds both from an academic point of view and the actual market application of technologies such as internet-of-things (IoT), wearables, artificial intelligence, machine learning, and ecommerce. We understand how to identify, scale, and apply leading technologies to large, established marketplaces for profit and value. Acquisition Criteria Our management team has developed decades of insight across multiple industries to choose the right markets and build winning teams and solutions to garner significant returns. Our management team is well qualified to find solid companies poised for growth with the right mix of capital and know-how . Our acquisition strategy will leverage our management team s and strategic advisor s proprietary network of long-standing relationships and industry contacts as well as inbound opportunities to source a business combination. While we focus on overall strength of the prospective targets and their key differentiators compared to the competition in their sector, we also consider the following general selection criteria: The target has an enterprise value of between $500 million and $1 billion; The target has outstanding research and development team in place with strong connection to the academic sector; The target has strong leadership team with proven process in place to empower and grow next level of managers; The target has clean and professionally audited financials and well regarded human resources management best practices; The target s current technologies, products, or solutions are well received in the sector, with clear advantage over its competitors; The business proposition of the target can be clearly communicated to the capital market, with value-drivers that can be articulated clearly for the public market to monitor; The business presents a multi-year value-creation opportunity for which the expansionary funding from the business combination can be a powerful catalyst; and The target must have a strong corporate governance and control systems in place to scale and live up to the standards of a public listed company. While focusing on value creation, we may use other criteria and guidelines as well. Any evaluation relating to the merits of a particular initial business combination may be based on these general criteria and guidelines as well as other considerations, factors, and criteria that our management team may deem relevant. In the event that we decide to enter into an initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that fact in our stockholder communications related to the acquisition. As discussed elsewhere in this prospectus, this would be in the form of proxy solicitation materials or tender offer documents that we would file with the SEC. 7 Table of Contents Acquisition Process We place strong emphasis on conducting comprehensive due diligence on prospective targets within the chosen sectors. We will utilize the diligence, rigor, and expertise of our managements respective platforms to evaluate potential targets strengths, weaknesses, and opportunities to identify the relative risk and return profile of any potential target for our initial business combination. Given our management team s extensive experience across multiple sectors, we will often be relatively familiar with a prospective target s strengths and weaknesses, competitive landscape, and business model. In evaluating a prospective target business, we expect to conduct an extensive due diligence review which may encompass, as applicable and among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities and a review of financial and other information about the target and its industry. We will also utilize our management team s operational and capital planning experience. We are not prohibited from pursuing an initial business combination with a target that is affiliated with our sponsor, officers or directors or making the initial business combination through a joint venture or other form of shared ownership with our sponsor, officers or directors. In the event we seek to complete our initial business combination with an initial business combination target that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, would obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions that such an initial business combination is fair to our company from a financial point of view. Members of our management team will directly or indirectly own founder shares and/or private placement units following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such entity. We do not believe, however, that the fiduciary duties or contractual obligations of our directors or officers will materially affect our ability to identify and pursue business combination opportunities or complete our initial business combination. Our management team is continuously made aware of potential investment opportunities, one or more of which we may desire to pursue for a business combination. Initial Business Combination We will have until 12 months from the closing of this offering to consummate our initial business combination. However, if we anticipate that we may not be able to consummate our initial business combination within 12 months, we may extend the period of time to consummate a business combination by up to two additional three-month periods (up to a maximum of 18 months from the closing of this offering). Pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company, in order to extend the time available for us to consummate our initial business combination, our sponsor or its affiliates or designees must deposit into the trust account, for each additional three-month period, $1,000,000, or up to $1,150,000 if the underwriters exercise the over-allotment option in full ($0.10 per share), on or prior to the date of the applicable deadline with respect to such three-month extension period. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. Any such payments would be made in the form of non-interest bearing loans. If we complete our initial business combination, we will, at the option of our sponsor, repay such loaned amounts out of the proceeds of the trust account released to us or convert a portion or all of the total loan amount into units at a price of $10.00 per unit, which units will be identical to the placement units. If we do not complete a business combination, we will repay such loans only from funds held outside of the trust account. 8 Table of Contents Our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable) at the time of the agreement to enter into the initial business combination. If our board is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm that is a member of FINRA, or an independent accounting firm with respect to the satisfaction of such criteria. Our stockholders may not be provided with a copy of such opinion, nor will they be able to rely on such opinion. The net proceeds of this offering and the sale of the private placement units released to us from the trust account upon the closing of our initial business combination may be used as consideration to pay the sellers of a target business with which we complete our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or used for redemption of our public shares, we may use the balance of the cash released to us from the trust account following the closing for general corporate purposes, including for maintenance or expansion of operations of the post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. In addition, we may be required to obtain additional financing in connection with the closing of our initial business combination to be used following the closing for general corporate purposes as described above. There is no limitation on our ability to raise funds through the issuance of equity or equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements or backstop agreements we may enter into following consummation of this offering. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our initial business combination. At this time, we are not a party to any arrangement or understanding with any third party with respect to raising any additional funds through the sale of securities or otherwise. None of our sponsors, officers, directors, or stockholders is required to provide any financing to us in connection with or after our initial business combination. We may also obtain financing prior to the closing of our initial business combination to fund our working capital needs and transaction costs in connection with our search for and completion of our initial business combination. Our amended and restated certificate of incorporation will provide that, following this offering and prior to the consummation of our initial business combination, we will be prohibited from issuing additional securities that would entitle the holders thereof to (i) receive funds from the trust account or (ii) vote as a class with our public shares (a) on any initial business combination or (b) to approve an amendment to our amended and restated certificate of incorporation to (x) extend the time we have to consummate a business combination beyond 12 months from the closing of this offering (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus) or (y) amend the foregoing provisions, unless (in connection with any such amendment to our amended and restated certificate of incorporation) we offer our public stockholders the opportunity to redeem their public shares. Corporate Information Our executive offices are located at 3524 Silverside Road, Suite 35B, Wilmington, DE 19810, and our telephone number is (858) 922-3770. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. 9 Table of Contents In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the prior September 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates equals or exceeds $250 million as of the prior September 30th, or (2) our annual revenues equal or exceed $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates equals or exceeds $700 million as of the prior September 30. 10 Table of Contents THE OFFERING In making your decision on whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in this prospectus. Securities offered 10,000,000 units, at $10.00 per unit, each unit consisting of: one share of Class A common stock; and one redeemable warrant. Proposed Nasdaq symbols Units: NWACU common stock: NWAC Warrants: NWACW Trading commencement and separation of Class A common stock and warrants The units are expected to begin trading on or promptly after the date of this prospectus. We expect the Class A common stock and warrants comprising the units will begin separate trading on the 52nd business day following the date of this prospectus unless the Representative informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the shares of Class A common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of Class A common stock and warrants. In no event will the Class A common stock and warrants be traded separately until we have filed a Current Report on Form 8-K with the SEC containing an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which closing is anticipated to take place three business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. 11 Table of Contents Units: Number outstanding before this offering and the private placement 0 Number of placement units to be sold in the private placement 451,000(1) Number outstanding after this offering and the private placement 10,451,000(1) Common stock: Number outstanding before this offering 2,875,000 shares of Class B common stock(2) Number outstanding after this offering and the private placement 13,201,000 shares of Class A common stock and Class B common stock(1)(3) Warrants: Number outstanding before this offering and the private placement 0 Number of private placement warrants to be sold in the private placement 451,000(1) Number of warrants to be outstanding after this offering and the private placement 10,451,000(1) Exercisability Each whole warrant is exercisable to purchase one share of our Class A common stock. Only whole warrants are exercisable. Exercise price $11.50 per share, subject to adjustment as described herein. In addition, if (x) we issue additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or its affiliates, prior to such issuance) (the Newly Issued Price ), ____________ (1) Assumes no exercise of the underwriters over-allotment option and the forfeiture by our sponsor of an aggregate of 375,000 founder shares. (2) Includes up to an aggregate of 375,000 shares that are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised. (3) Comprised of 10,451,000 shares of Class A common stock, 2,500,000 shares of Class B common stock, and 250,000 representative shares. The Class B common stock is convertible into shares of our Class A common stock on a one-for-one basis, subject to adjustment as described herein adjacent to the caption Founder shares conversion and anti-dilution rights. 12 Table of Contents (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our common stock during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the Market Value ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price described below under Redemption of warrants will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. Exercise period The warrants will become exercisable on the later of: the completion of our initial business combination, and 12 months from the date of this prospectus; provided, in each case, that we have an effective registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise of the warrants and a current prospectus relating to them is available (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement) and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder. We are not registering the shares of Class A common stock issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable, but in no event later than 15 business days after the closing of our initial business combination, we will use our best efforts to file with the SEC a registration statement covering the shares of Class A common stock issuable upon exercise of the warrants, to cause such registration statement to become effective and to maintain a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed, as specified in the warrant agreement. If a registration statement covering the shares of common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption. Notwithstanding the above, if our common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to 13 Table of Contents do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, and in the event we do not so elect, we will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption of warrants and cashless exercise Once the warrants become exercisable, we may redeem the outstanding warrants: in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period; and if, and only if, the reported closing price of our Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. We will not redeem the warrants unless a registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise of the warrants is effective and a current prospectus relating to those shares of Class A common stock is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may not exercise our redemption right if the issuance of shares of common stock upon exercise of the warrants is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect such registration or qualification. We will use our best efforts to register or qualify such shares of common stock under the blue sky laws of the state of residence in those states in which the warrants were offered by us in this offering. 14 Table of Contents If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In determining whether to require all holders to exercise their warrants on a cashless basis, our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our stockholders of issuing the maximum number of shares of Class A common stock issuable upon the exercise of our warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A common stock underlying the warrants multiplied by the excess of the fair market value (defined below) over the exercise price of the warrant by (y) the fair market value. The fair market value shall mean the average reported closing price of the Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Please see the section of this prospectus entitled Description of Securities Redeemable Warrants for additional information. Founder shares In June 2021, our sponsor purchased 5,750,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.004 per share. On May 26, 2022, 2,875,000 founder shares were returned to the Company for cancellation for no consideration, resulting in our sponsor owning an aggregate of 2,875,000 founder shares, up to 375,000 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. The number of founder shares issued and outstanding was determined based on the expectation that the founder shares would represent 20% of the outstanding shares after this offering (excluding private placement shares). As such, our initial stockholders will collectively own 20% of our issued and outstanding shares after this offering (assuming they do not purchase any units in this offering and excluding private placement shares). None of our sponsor, officers or directors have expressed an intention to purchase any units in this offering. Up to an aggregate 375,000 founder shares will be subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised so that our initial stockholders will maintain ownership of 20% of our common stock after this offering (excluding private placement shares). We will effect a stock dividend or share contribution prior to this offering should the size of the offering change, in order to maintain such ownership percentage. The founder shares are identical to the shares of Class A common stock included in the units being sold in this offering, except that: the founder shares are shares of Class B common stock that automatically convert into shares of our Class A common stock at the time of our initial business combination on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights as described herein; the founder shares are subject to certain transfer restrictions, as described in more detail below; the founder shares are entitled to registration rights; 15 Table of Contents our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to (i) waive their redemption rights with respect to their founder shares, private placement shares and public shares in connection with the completion of our initial business combination, (ii) waive their redemption rights with respect to their founder shares, private placement shares and public shares in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation to (A) modify the substance or timing of our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus)(B) with respect to any other material provisions relating to stockholders rights or pre-initial business combination activity, (iii) waive their rights to liquidating distributions from the trust account with respect to their founder shares and private placement shares if we fail to complete our initial business combination within 12 months from the closing of this offering (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus), although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame and (iv) vote any founder shares and private placement shares held by them and any public shares purchased during or after this offering (including in open market and privately-negotiated transactions) in favor of our initial business combination. If we submit our initial business combination to our public stockholders for a vote, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. As a result of the agreement of our sponsor, officers and directors to vote their shares in favor of our initial business combination, if any, to vote their shares in favor of our initial business combination, we would need 3,524,501, or 35.25% assuming all outstanding shares are voted and the underwriters over-allotment option is not exercised), or 286,751, or 2.9% (assuming only the minimum number of shares representing a quorum are voted and the underwriters over-allotment option is not exercised), of the 10,000,000 public shares sold in this offering to be voted in favor of our initial business combination in order to have our initial business combination approved. 16 Table of Contents Transfer restrictions on founder shares Our initial stockholders have agreed not to transfer, assign or sell any of their founder shares until the earlier to occur of: (A) one year after the completion of our initial business combination or (B) subsequent to our initial business combination, (x) if the reported closing price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, or (y) the date on which we complete a liquidation, merger, capital stock exchange or other similar transaction that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property (except as described herein under the section of this prospectus entitled Principal Stockholders Restrictions on Transfers of Founder Shares and Private Placement Units ). Any permitted transferees will be subject to the same restrictions and other agreements of our initial stockholders with respect to any founder shares. We refer to such transfer restrictions throughout this prospectus as the lock-up. Founder shares conversion and anti-dilution rights The founder shares are shares of Class B common stock that will automatically convert into shares of our Class A common stock at the time of our initial business combination on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described herein. In the case that additional shares of Class A common stock or equity-linked securities are issued or deemed issued in connection with our initial business combination, the number of shares of Class A common stock issuable upon conversion of all founder shares will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of this offering (excluding private placement shares), plus the total number of shares of Class A common stock issued, or deemed issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of the initial business combination, excluding any shares of Class A common stock or equity-linked securities exercisable for or convertible into shares of Class A common stock issued, or to be issued, to any seller in the initial business combination and any private placement-equivalent units issued to our sponsor, officers or directors upon conversion of working capital loans or extension loans, if any; provided that such conversion of founder shares will never occur on a less than one for one basis; Voting Rights Holders of record of the Class A common stock and holders of record of the Class B common stock will vote together as a single class on all matters submitted to a vote of our stockholders, with each share of common stock entitling the holder to one vote except as required by law. 17 Table of Contents Private placement units Our sponsor has agreed to purchase an aggregate of 451,000 private placement units (or 496,000 private placement units if the underwriters over-allotment option is exercised in full) at a price of $10.00 per unit, for an aggregate purchase price of $4,510,000 ($4,960,000 if the underwriters over-allotment option is exercised in full). Each private placement unit is identical to the units offered by this prospectus except as described below. There will be no redemption rights or liquidating distributions from the trust account with respect to the founder shares or private placement shares. Our initial stockholders have agreed to waive their redemption rights with respect to any founder shares or private placement shares (i) in connection with the consummation of a business combination, (ii) in connection with a stockholder vote to amend our amended and restated certificate of incorporation to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain amendments to our charter prior thereto, to redeem 100% of our public shares if we do not complete our initial business combination within 12 months (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus) from the completion of this offering or with respect to any other provision relating to stockholders rights or pre-initial business combination activity and (iii) if we fail to consummate a business combination within 12 months (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus) from the completion of this offering or if we liquidate prior to the expiration of the 12-month period (or up to 18 month period, if we extend the time to complete a business combination as described in this prospectus). However, our initial stockholders will be entitled to redemption rights with respect to any public shares held by them if we fail to consummate a business combination or liquidate within the 12-month period (or up to 18-month period, if we extend the time to complete a business combination as described in this prospectus). Transfer restrictions on private placement units and their underlying securities The private placement units and their component securities will not be transferable, assignable or saleable until 30 days after the consummation of our initial business combination except to permitted transferees. Proceeds to be held in trust account Nasdaq rules provide that at least 90% of the gross proceeds from this offering and the sale of the private placement units be deposited in a trust account. Of the net proceeds of this offering and the sale of the private placement units, $102,000,000, or $10.20 per unit ($117,300,000, or $10.20 per unit, if the underwriters over-allotment option is exercised in full) will be placed into a trust account in the United States at J.P. Morgan Chase Bank, N.A., with Continental Stock Transfer & Trust Company acting as trustee, and $1,510,000 (regardless of the extent to which the underwriters over-allotment option is exercised) will be used to pay expenses in connection with the closing of this offering and for working capital following this offering. These proceeds include $2,500,000 (or $2,875,000 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions. 18 Table of Contents Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, our amended and restated certificate of incorporation will provide that the proceeds from this offering and the sale of the private placement units, will not be released from the trust account until the earliest of (a) the completion of our initial business combination, (b) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation to (i) modify the substance or timing of our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus) or (ii) with respect to any other material provisions relating to stockholders rights or pre-initial business combination activity, and (c) the redemption of our public shares if we are unable to complete our initial business combination within 12 months from the closing of this offering (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus), subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. Anticipated expenses and funding sources Unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use, except the withdrawal of interest to pay our taxes and/or to redeem our public shares in connection with an amendment to our amended and restated certificate of incorporation, as described above. The proceeds held in the trust account will be invested only in U.S. government securities with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act that invest only in direct U.S. government treasury obligations. We will disclose in each quarterly and annual report filed with the SEC prior to our initial business combination whether the proceeds deposited in the trust account are invested in U.S. government treasury obligations or money market funds or a combination thereof. Based upon current interest rates, we expect the trust account to generate approximately $153,000 of interest annually assuming an interest rate of 0.15% per year; however, we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement units not held in the trust account, which will be approximately $850,000 in working capital after the payment of approximately $660,000 in expenses relating to this offering; and any loans or additional investments from our sponsor, or an affiliate of our sponsor or certain of our officers and directors, although they are under no obligation to advance funds or invest in us, and provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of our initial business combination. Up to $1,500,000 of such loans may be convertible into units, at a price of $10.00 per unit at the option of the lender. 19 Table of Contents Conditions to completing our initial business combination In accordance with the rules of Nasdaq, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the amount of deferred underwriting discounts held in trust and net of taxes payable) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. However, we may structure our initial business combination so that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders, or for other reasons. However, we will only complete an initial business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of Nasdaq s 80% of fair market value test. If the initial business combination involves more than one target business, the 80% of fair market value test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as our initial business combination for purposes of seeking stockholder approval or conducting a tender offer, as applicable. 20 Table of Contents Permitted purchases of public shares and public warrants by our affiliates If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, initial stockholders, directors, officers, advisors or their affiliates may purchase public shares or public warrants in privately-negotiated transactions or in the open market either prior to or following the completion of our initial business combination. There is no limit on the number of shares or warrants our initial stockholders, directors, officers, advisors or their affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. Subsequent to the consummation of this offering, we will adopt an insider trading policy which will require insiders to: (i) refrain from purchasing our securities during certain blackout periods when they are in possession of any material non-public information and (ii) clear all trades of company securities with a compliance officer prior to execution. We cannot currently determine whether our insiders will make such purchases pursuant to a Rule 10b5-1 plan, as it will be dependent upon several factors, including but not limited to, the timing and size of such purchases. Depending on such circumstances, our insiders may either make such purchases pursuant to a Rule 10b5-1 plan or determine that such a plan is not necessary. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. None of the funds held in the trust account will be used to purchase shares or public warrants in such transactions prior to completion of our initial business combination. See Proposed Business Permitted Purchases of Our Securities for a description of how our sponsor, initial stockholders, directors, officers, advisors or any of their affiliates will select which stockholders to purchase securities from in any private transaction. Our sponsor, directors, officers, advisors or any of their affiliates will not make any purchases if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. 21 Table of Contents The purpose of any such purchases of shares could be to vote such shares in favor of the initial business combination and thereby increase the likelihood of obtaining stockholder approval of the initial business combination or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our shares of Class A common stock or warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Redemption rights for public stockholders upon completion of our initial business combination We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.20 per public share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by deferred underwriting commissions we will pay to the underwriters. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and private placement shares held by them and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination or otherwise. Manner of conducting redemptions We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a stockholder meeting called to approve the initial business combination or (ii) without a stockholder vote by means of a tender offer. The decision as to whether we will seek stockholder approval of a proposed initial business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval under applicable law or stock exchange listing requirements. Asset acquisitions and stock purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding common 22 Table of Contents stock or seek to amend our amended and restated certificate of incorporation would require stockholder approval. So long as we obtain and maintain a listing for our securities on Nasdaq, we will be required to comply with Nasdaq s stockholder approval rules. The requirement that we provide our public stockholders with the opportunity to redeem their public shares by one of the two methods listed above will be contained in provisions of our amended and restated certificate of incorporation and will apply whether or not we maintain our registration under the Exchange Act or our listing on Nasdaq. Such provisions may be amended if approved by holders of 65% of our common stock entitled to vote thereon. If we provide our public stockholders with the opportunity to redeem their public shares in connection with a stockholder meeting, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and file proxy materials with the SEC. If we seek stockholder approval, unless otherwise required by applicable law, regulation or stock exchange rules, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the Company representing a majority of the voting power of all outstanding shares of capital stock of the Company entitled to vote at such meeting. Our initial stockholders will count towards this quorum and, pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote their founder shares and any public shares purchased during or after this offering (including in open market and privately-negotiated transactions) in favor of our initial business combination. For purposes of seeking approval of the majority of our outstanding shares of common stock voted, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. As a result, in addition to our initial stockholders founder shares, we would need 3,524,501, or 35.25% (assuming all outstanding shares are voted and the underwriters over-allotment option is not exercised), or 286,751, or 2.9% (assuming only the minimum number of shares representing a quorum are voted and the underwriters over-allotment option is not exercised), of the 10,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved. We intend to give not less than 10 days nor more than 60 days prior written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination. These quorum and voting thresholds, and the voting agreements of our initial stockholders, may make it more likely that we will consummate our initial business combination. Each public stockholder may elect to redeem its public shares irrespective of whether they vote for or against the proposed transaction or whether they were a stockholder on the record date for the stockholder meeting held to approve the proposed transaction. 23 Table of Contents If a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other legal reasons, we will: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and file tender offer documents with the SEC prior to completing our initial business combination, which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public stockholders not tendering more than a specified number of public shares, which number will be based on the requirement that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of deferred underwriters fees and commissions (so that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement that may be contained in the agreement relating to our initial business combination. If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase shares of our Class A common stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act. We intend to require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to, at the holder s option, either deliver their stock certificates to our transfer agent or deliver their shares to our transfer agent electronically using the Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) system, prior to the date set forth in the proxy materials or tender offer documents, as applicable. In the case of proxy materials, this date may be up to two business days prior to the vote on the proposal to approve the initial business combination. In addition, if we conduct redemptions in connection with a stockholder vote, we intend to require a public stockholder seeking redemption of its public shares to also submit a written request for redemption to our transfer agent two business days prior to the vote in which the name of the beneficial owner of such shares is included. The proxy materials or tender offer documents, as applicable, that we 24 Table of Contents will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public stockholders to satisfy such delivery requirements. We believe that this will allow our transfer agent to efficiently process any redemptions without the need for further communication or action from the redeeming public stockholders, which could delay redemptions and result in additional administrative cost. If the proposed initial business combination is not approved and we continue to search for a target company, we will promptly return any certificates or shares delivered by public stockholders who elected to redeem their shares. Our amended and restated certificate of incorporation will provide that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of deferred underwriters fees and commissions (so that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. For example, the proposed initial business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed initial business combination. In the event the aggregate cash consideration we would be required to pay for all shares of Class A common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will not complete the initial business combination or redeem any shares, and all shares of Class A common stock submitted for redemption will be returned to the holders thereof. Limitation on redemption rights of stockholders holding more than 15% of the shares sold in this offering if we hold stockholder vote Notwithstanding the foregoing redemption rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. We believe the restriction described above will discourage stockholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public stockholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against an initial business combination if such holder s shares are not purchased by us or our management at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of stockholders to unreasonably attempt 25 Table of Contents to block our ability to complete our initial business combination, particularly in connection with an initial business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders ability to vote all of their shares (including all shares held by those stockholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Redemption rights in connection with proposed amendments to our certificate of incorporation Our amended and restated certificate of incorporation will provide that any of its provisions related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the private placement of warrants into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein) may be amended if approved by holders of 65% of our common stock entitled to vote thereon, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of 65% of our common stock entitled to vote thereon. In all other instances, our amended and restated certificate of incorporation may be amended by holders of a majority of our outstanding common stock entitled to vote thereon, subject to applicable provisions of the Delaware General Corporation Law ( DGCL ) or applicable stock exchange rules. Our amended and restated certificate of incorporation will provide that we may not issue additional shares of capital stock that would entitle the holders thereof to receive funds from the trust account or vote on any initial business combination or on matters related to our pre-initial business combination activity. Our initial stockholders, who will collectively beneficially own 20% of our outstanding shares of common stock upon the closing of this offering (assuming they do not purchase any units in this offering and excluding private placement shares), will participate in any vote to amend our amended and restated certificate of incorporation and/or trust agreement and will have the discretion to vote in any manner they choose. Our sponsor, executive officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation to (A) modify the substance or timing of our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus) or (B) with respect to any other material provisions relating to stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of Class A common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then outstanding public shares. Our sponsor, officers, directors and director nominees have entered into a letter agreement with us pursuant to which they have agreed to waive their redemption rights with respect to any founder shares, private placement shares and any public shares held by them in connection with the completion of our initial business combination. 26 Table of Contents Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be used to pay amounts due to any public stockholders who exercise their redemption rights as described above under Redemption rights for public stockholders upon completion of our initial business combination. We will use the remaining funds to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or used for redemption of our public shares, we may use the balance of the cash released to us from the trust account following the closing for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our amended and restated certificate of incorporation will provide that we will have only 12 months from the closing of this offering (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus) to complete our initial business combination. If we are unable to complete our initial business combination within such 12-month period (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus), we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within the 12 months from the closing of this offering (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus). 27 Table of Contents Our sponsor, officers, directors and director nominees have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to any founder shares held by them if we fail to complete our initial business combination within 12 months from the closing of this offering (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus). However, if our initial stockholders acquire public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted 12-month time period (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus). The underwriters have agreed to waive their rights to their deferred underwriting commission held in the trust account in the event we do not complete our initial business combination and subsequently liquidate and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. Ability to extend time to complete business combination We will have until 12 months from the closing of this offering to consummate an initial business combination. However, if we anticipate that we may not be able to consummate our initial business combination within 12 months, we may extend the period of time to consummate a business combination by up to two additional three-month periods (up to a maximum of 18 months from the closing of this offering). Pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company, in order to extend the time available for us to consummate our initial business combination, our sponsor or its affiliates or designees must deposit into the trust account, for each additional three-month period, $1,000,000, or up to $1,150,000 if the underwriters exercise the over-allotment option in full ($0.10 per share), on or prior to the date of the applicable deadline with respect to such three-month extension period. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. Any such payments would be made in the form of non-interest bearing loans. If we complete our initial business combination, we will, at the option of our sponsor, repay such loaned amounts out of the proceeds of the trust account released to us or convert a portion or all of the total loan amount into units at a price of $10.00 per unit, which units will be identical to the placement units. If we do not complete a business combination, we will repay such loans only from funds held outside of the trust account. 28 Table of Contents Limited payments to insiders There will be no finder s fees, reimbursement, consulting fee, non-cash payments, monies in respect of any payment of a loan or other compensation paid by us to our sponsor, officers or directors, or any affiliate of our sponsor or officers, prior to, or in connection with any services rendered in order to effectuate, the consummation of our initial business combination (regardless of the type of transaction that it is). However, the following payments may be made to our sponsor, officers or directors, or our or their affiliates, none of which will be made from the proceeds of this offering held in the trust account prior to the completion of our initial business combination: Repayment of up to an aggregate of up to $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses Payment to our sponsor of $3,000 per month, for up to 18 months, for office space, utilities and secretarial and administrative support; Reimbursement for any out-of-pocket expenses related to identifying, investigating, negotiating and completing an initial business combination; and Repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into private placement units, at a price of $10.00 per unit at the option of the lender. The units would be identical to the private placement units. The terms of such working capital loans by our sponsor or its affiliates, or our officers and directors, if any, have not been determined and no written agreements exist with respect to such loans. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliates. Audit Committee We will establish and maintain an audit committee to, among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section of this prospectus entitled Management Committees of the Board of Directors Audit Committee. 29 Table of Contents Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business with which we have entered into a written letter of intent, confidentiality or similar agreement or business combination agreement, reduce the amount of funds in the trust account to below the lesser of (i) $10.20 per public share and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.20 per share due to reductions in the value of the trust assets, less taxes payable; provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether or not such waiver is enforceable), nor will it apply to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. However, we have not asked our sponsor to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations, and believe that our sponsor s only assets are securities of our company. Therefore, we cannot assure you that our sponsor would be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties, including, without limitation, claims by vendors and prospective target businesses. 30 Table of Contents RISKS We are a blank check company that has conducted no operations and has generated no revenues to date. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision whether to invest in our securities, you should take into account not only the background of our management team, but also the special risks we face as a blank check company. This offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see the section of this prospectus entitled Proposed Business Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419. You should carefully consider these and the other risks set forth in the section of this prospectus entitled Risk Factors beginning on page 34 of this prospectus. 31 Table of Contents
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+prospectus summary. These risks include, but are not limited to: We are a blank check company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the COVID-19 outbreak and the status of debt and equity markets. We may have a limited ability to assess the management of a prospective target business and, as a result, may affect our initial business combination with a target business whose management may not have the skills, qualifications or abilities to manage a public company. Our public shareholders may not be afforded an opportunity to vote on our proposed business combination, which means we may complete our initial business combination even though a majority of our public shareholders do not support such a combination. Although we have identified general criteria and guidelines that we believe are important in evaluating prospective target businesses, we may enter into our initial business combination with a target that does not meet such criteria and guidelines, and as a result, the target business with which we enter into our initial business combination may not have attributes entirely consistent with our general criteria and guidelines. As the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets. This could increase the cost of our initial business combination. Our sponsor has the right to extend the term we have to consummate our initial business combination, without providing our shareholders with redemption rights. Our ability to successfully effect our initial business combination and to be successful thereafter will be totally dependent upon the efforts of our key personnel, some of whom may join us following our initial business combination. The loss of key personnel could negatively impact the operations and profitability of our post-combination business. We are dependent upon our officers and directors and their departure could adversely affect our ability to operate. If third parties bring claims again us, the proceeds held in the trust account could be reduced and the per-share redemption amount receive by shareholders may be less than $10.15 per share. Since our sponsor, officers and directors will lose their entire investment in us if our initial business combination is not completed, a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination. Our officers and directors will allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial business combination. Certain of our officers and directors are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented. Members of our management team have significant experience as founders, board members, officers or executives of other companies. As a result, certain of those persons have been, may be, or may become, involved in proceedings, investigations and litigation relating to the business affairs of the companies with which they were, are, or may in the future be, affiliated. This may have an adverse effect on us, which may impede our ability to consummate an initial business combination. 12 Our officers, directors, security holders and their respective affiliates may have competitive pecuniary interests that conflict with our interests. We are not required to obtain an opinion from an independent investment banking firm or another independent entity, and consequently, you may have no assurance from an independent source that the price we are paying for the business is fair to our shareholders from a financial point of view. The securities in which we invest the funds held in the trust account could bear a negative rate of interest, which could reduce the value of the assets held in trust such that the per-share redemption amount received by public shareholders may be less than $10.15 per share. If we are deemed to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted, which may make it difficult for us to complete our initial business combination. The Nasdaq may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities and subject us to additional trading restrictions. If the net proceeds of this offering and the sale of private placement units not being held in the trust account are insufficient to allow us to operate for at least the next 12 months (or 13 to 18 months, as applicable) from the closing of this offering, we may be unable to complete our initial business combination, in which case our public shareholders may only receive $10.15 per share, or less than such amount in certain circumstances, and our rights will expire worthless. If we seek shareholder approval of our initial business combination and we do not conduct redemptions pursuant to the tender offer rules, and if you or a "group" of shareholders are deemed to hold in excess of 15% of our ordinary shares, you will lose the ability to redeem all such shares in excess of 15% of our ordinary shares. Our sponsor paid an aggregate of $25,000, or approximately $0.009 per founder share, and, accordingly, you will experience immediate and substantial dilution upon the purchase of our Class A ordinary shares. Additionally, our sponsor could potentially make a substantial profit even if the company selects an acquisition target that substantially declines in value and is unprofitable for public investors. We may issue additional ordinary or preference shares to complete our initial business combination or under an employee incentive plan after completion of our initial business combination. We may also issue Class A ordinary shares upon the conversion of the Class B ordinary shares at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions contained in our amended and restated memorandum and articles of association. Any such issuances would dilute the interest of our shareholders and likely present other risks. We may issue notes or other debt securities, or otherwise incur substantial debt, to complete a business combination, which may adversely affect our leverage and financial condition and thus negatively impact the value of our shareholders investment in us. The grant of registration rights to our sponsor and holders of our private placement units and representative s shares may make it more difficult to complete our initial business combination, and the future exercise of such rights may adversely affect the market price of our Class A ordinary shares. We may attempt to complete our initial business combination with a private company about which little information is available, which may result in a business combination with a company that is not as profitable as we suspected, if at all. 13 Corporate Information We are an "emerging growth company," as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an "emerging growth company" can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to "emerging growth company" shall have the meaning associated with it in the JOBS Act. Additionally, we are a "smaller reporting company" as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our Class A ordinary shares held by non-affiliates exceeds $250 million as of the end of the prior June 30th, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our Class A ordinary shares held by non-affiliates exceeds $700 million as of the prior June 30th. Exempted companies are Cayman Islands companies wishing to conduct business outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received a tax exemption undertaking from the Financial Secretary of the Cayman Islands that, in accordance with Section 6 of the Tax Concessions Act (2018 Revision) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations shall apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax shall be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are a Cayman Islands exempted company incorporated on June 21, 2021. Our executive offices are located at 1800 Avenue of the Stars, Suite 1475, Los Angeles, CA 90067, and our telephone number is 212-616-0011. 14 The Offering In making your decision whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled "Risk Factors" beginning on page 33 of this prospectus. Securities offered 10,000,000 units, at $10.00 per unit, each unit consisting of: one Class A ordinary share; and one right to receive one-sixth (1/6) of one Class A ordinary share upon the consummation of an initial business combination, subject to conditions described in this prospectus. Proposed Nasdaq symbols Units: "SUNFU" Class A Ordinary Shares: "SUNF" Rights: "SUNFR" Trading commencement and separation of Class A ordinary shares and rights The units will begin trading promptly after the date of this prospectus. The Class A ordinary shares and rights comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless EF Hutton informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the Class A ordinary shares and rights commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into Class A ordinary shares and rights. Separate trading of the Class A ordinary shares and rights is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A ordinary shares and rights be traded separately until we have filed with the SEC a Current Report on Form 8-K which includes an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which is anticipated to take place three business days from the date of this prospectus. Units: Number issued and outstanding before this offering 0 Number of private placement units to be sold in a private placement simultaneously with this offering 404,600(1) Number issued and outstanding after this offering 10,404,600(1) Ordinary shares: Number issued and outstanding before this offering 2,875,000(2) Number issued and outstanding after this offering 12,954,600(1)(3) Rights: Number issued and outstanding before this offering 0 Number of rights to be issued and outstanding after this offering and the private placement 10,404,600(1)(4) (1) Assumes no exercise of the underwriters over-allotment option. (2) Consists solely of founder shares (Class B ordinary shares) and includes up to 375,000 Class B ordinary shares that are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised. Except as otherwise specified, the rest of this prospectus has been drafted to give effect to the full forfeiture of these 375,000 Class B ordinary shares. (3) Includes 10,000,000 public shares, 50,000 representative s shares, 404,600 private placement shares and 2,500,000 founder shares. (4) Includes 10,000,000 public rights and 404,600 private placement rights. 15 Term of Rights Each holder of a right will receive one-sixth (1/6) of one Class A ordinary share upon consummation of our initial business combination. In the event we will not be the surviving entity upon completion of our initial business combination, each holder of a right will be required to affirmatively convert its rights in order to receive the 1/6 Class A ordinary share underlying each right (without paying any additional consideration). If we are unable to complete an initial business combination within the required time period and we redeem the public shares for the funds held in the trust account, holders of rights will not receive any such funds in exchange for their rights and the rights will expire worthless. We will not issue fractional shares upon exchange of the rights. If, upon conversion of the rights, a holder would be entitled to receive a fractional interest in a share, we will round down to the nearest whole number of the number of shares to be issued to holder and, upon conversion, pay in cash the fair value of fractions of a share as of the time when those entitled to receive such fractions are determined. We will make the determination of how we are treating fractional shares at the time of our initial business combination and will include such determination in the proxy materials we will send to shareholders for their consideration of such initial business combination. Founder shares On June 30, 2021, our sponsor purchased 2,875,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.009 per share to cover certain of our offering and formation costs. Subsequently, our sponsor transferred a total of 185,000 founder shares to our officers and director nominees. Prior to the initial investment in the company of $25,000 by our sponsor, we had no assets, tangible or intangible. The purchase price of the founder shares was determined by dividing the amount of cash contributed to us by the number of founder shares issued. Our initial shareholders will own approximately 20% of our issued and outstanding shares after this offering (assuming they do not purchase units in this offering). If we increase or decrease the size of the offering, we will effect a capitalization or share surrender or redemption or other appropriate mechanism, as applicable, with respect to our Class B ordinary shares immediately prior to the consummation of the offering in such amount as to maintain the ownership of founder shares by our initial shareholders at 20% of our issued and outstanding ordinary shares upon the consummation of this offering. The founder shares, which are Class B ordinary shares, are identical to the Class A ordinary shares included in the units being sold in this offering, except that: the founder shares are subject to certain transfer restrictions, as described in more detail below; our sponsor, officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association that would (i) modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering as described in more detail in this prospectus if we extend the period of time to consummate a business combination by the maximum amount) or (ii) with respect to the other provisions relating to shareholders rights or pre-business combination activity, unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares; our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed (i) to waive their redemption rights with respect to their founder shares, private placement shares and public shares in connection with the completion of our initial business combination and (ii) to waive their rights to liquidating distributions from the trust account with respect to their founder shares and private placement shares if we fail to complete our initial business combination within 12 months from the closing of this offering (or 13 to 18 months from the closing of this offering if we extend the period of time to consummate a business combination as described in more detail in this prospectus) (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). If we submit our initial business combination to our public shareholders for a vote, our sponsor has agreed, pursuant to such letter agreement, to vote their founder shares and any public shares purchased during or after this offering in favor of our initial business combination. As a result, in addition to our initial shareholder s founder shares and private placement shares we would need only approximately 334,051, or approximately 3.3%, of the 10,000,000 public shares sold in this offering to be voted in favor of a transaction, or 284,051, or approximately 2.8%, if the holders of the representative s shares also choose to vote in favor of the business combination (assuming only a quorum is present at such meeting and only a majority of the shares present are required to approve our initial business combination) in order to have our initial business combination approved (assuming the over-allotment option is not exercised); the founder shares are subject to registration rights; and the founder shares will be entitled to vote on the election of directors or continuing the company in a jurisdiction outside the Cayman Islands (including any special resolution required to amend the constitutional documents of the Company or to adopt new constitutional documents of the Company, in each case, as a result of the Company approving a transfer by way of continuation in a jurisdiction outside the Cayman Islands). 16 Representative s shares In connection with the consummation of this offering, we will issue to the representative and/or its designees 50,000 representative s shares (or 57,500 shares if the underwriters over-allotment option is exercised in full). The holders of the representative s shares have agreed not to transfer, assign or sell any such shares without our prior consent until the completion of the initial business combination. In addition, the holders of the representative s shares have agreed (i) to waive their redemption rights (or right to participate in any tender offer) with respect to such shares in connection with the completion of our initial business combination and (ii) to waive their rights to liquidating distributions from the trust account with respect to such shares if we fail to complete our initial business combination within 12 months (or 13 to 18 months, as applicable) from the closing of this offering. The representative s shares are deemed to be underwriters compensation by FINRA pursuant to FINRA Rule 5110. Transfer restrictions on founder shares Our initial shareholders have agreed not to transfer, assign or sell any of their founder shares until the earlier to occur of (A) six months after the date of the consummation of our initial business combination; or (B) the date on which we consummate a liquidation, merger, stock exchange or other similar transaction which results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property (except as described herein under the section of this prospectus entitled "Principal Shareholders — Restrictions on Transfers of Founder Shares and Private Placement Units"). Any permitted transferees will be subject to the same restrictions and other agreements of our initial shareholders with respect to any founder shares. Notwithstanding the foregoing, if the closing price of our Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing 150 days after our initial business combination, the founder shares will no longer be subject to such transfer restrictions. We refer to such transfer restrictions throughout this prospectus as the lock-up. Private placement units Our sponsor has committed to purchase an aggregate of 404,600 private placement units (or 442,100 private placement units if the over-allotment option is exercised in full) at a price of $10.00 per unit ($4,046,000 in the aggregate, or $4,421,000 if the over-allotment option is exercised in full) in a private placement that will close simultaneously with the closing of this offering. Each placement unit is identical to the units offered by this prospectus except as described below. There will be no redemption rights or liquidating distributions from the trust account with respect to the founder shares, placement shares or placement rights, which will expire worthless if we do not consummate a business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus). Our initial shareholders have agreed to waive their redemption rights with respect to their private placement shares (i) in connection with the consummation of a business combination, (ii) in connection with a shareholder vote to amend our amended and restated memorandum and articles of association to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain amendments to our charter prior thereto, to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the completion of this offering (or up to 18 months from the closing of this offering as described in more detail in this prospectus if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus) or with respect to any other provision relating to shareholders rights or pre-initial business combination activity and (iii) if we fail to consummate a business combination within 12 months from the completion of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus) or if we liquidate prior to the expiration of the 12 month period (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus). However, our initial shareholders will be entitled to redemption rights with respect to any public shares held by them if we fail to consummate a business combination or liquidate within the 12 month period. 17 Transfer restrictions on placement units The placement units and their component securities will not be transferable, assignable or salable until 30 days after the consummation of our initial business combination except to permitted transferees. Proceeds to be held in trust account Nasdaq rules provide that at least 90% of the gross proceeds from this offering and the sale of the private placement units be deposited in a trust account. Of the net proceeds we will receive from this offering and the sale of the private placement units described in this prospectus, $101,500,000 ($10.15 per unit) (or up to $116,725,000 ($10.15 per unit) if the underwriters over-allotment option is exercised in full together with up to an additional $0.0333 per public share per one-month extension in the event that our sponsor elects to extend the period of time to consummate a business combination as described in more details in this prospectus), will be deposited into a segregated trust account located in the United States with Continental Stock Transfer & Trust Company acting as trustee. The proceeds to be placed in the trust account include $3,500,000 (or up to $4,025,000 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions. The funds in the trust account will be invested only in specified U.S. government treasury bills or in specified money market funds. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, if any, the proceeds from this offering and the sale of the private placement units will not be released from the trust account until the earliest of (i) the completion of our initial business combination, (ii) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association to (A) modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering as described in more detail in this prospectus if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus) or (B) with respect to any other provision relating to shareholders rights or pre-business combination activity and (iii) the redemption of all of our public shares if we are unable to complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus), subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. 18 Anticipated expenses and funding sources Unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use, except the withdrawal of interest to pay taxes. Based upon current interest rates, we expect the trust account to generate approximately $100,000 of interest annually (assuming no exercise of the underwriters overallotment option and an interest rate of 0.10% per year) following the investment of such funds in specified U.S. government treasury bills or in specified money market funds. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement units not held in the trust account, which will be approximately $776,000 in working capital after the payment of approximately $770,000 in expenses relating to this offering and certain reimbursements to us by the underwriters; and any loans or additional investments from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation to advance funds or invest in us, and provided any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of a business combination. Conditions to completing our initial business combination Nasdaq rules require that our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable) at the time of our signing a definitive agreement in connection with our initial business combination. If our securities are not listed on the Nasdaq after this offering, we would not be required to satisfy the 80% requirement. However, we intend to satisfy the 80% requirement even if our securities are not listed on the Nasdaq at the time of our initial business combination. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or an independent accounting firm. We will complete our initial business combination only if the post-transaction company in which our public shareholders own shares will own or acquire 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our initial business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owner or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of Nasdaq s 80% of net assets test. If the initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking shareholder approval, as applicable. Permitted purchases of public shares and rights by our affiliates If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, officers, or their respective affiliates may purchase shares or rights in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Please see "Proposed Business — Permitted purchases of our securities" for a description of how such persons will determine which shareholders to seek to acquire shares from. There is no limit on the number of shares such persons may purchase, or any restriction on the price that they may pay. Any such price per share may be different than the amount per share a public shareholder would receive if it elected to redeem its shares in connection with our initial business combination. However, such persons have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. In the event our sponsor, directors, officers, or their respective affiliates determine to make any such purchases at the time of a shareholder vote relating to our initial business combination, such purchases could have the effect of influencing the vote necessary to approve such transaction. None of the funds in the trust account will be used to purchase shares in such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. Subsequent to the consummation of this offering, we will adopt an insider trading policy which will require insiders to: (i) refrain from purchasing shares during certain blackout periods and when they are in possession of any material non-public information and (ii) to clear all trades with our legal counsel prior to execution. We cannot currently determine whether our insiders will make such purchases pursuant to a Rule 10b5-1 plan, as it will be dependent upon several factors, including but not limited to, the timing and size of such purchases. Depending on such circumstances, our insiders may either make such purchases pursuant to a Rule 10b5-1 plan or determine that such a plan is not necessary. 19 We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchases are subject to such reporting requirements. None of the funds held in the trust account will be used to purchase shares or public rights in such transactions prior to the completion of our initial business combination. Our sponsor, directors, officers, or their respective affiliates will not make any purchases if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. See "Proposed Business — Permitted purchases of our securities" for a description of how our sponsor, initial shareholders, directors, officers, advisors or any of their affiliates will select which shareholders to purchase securities from in any private transaction. The purpose of any such purchases of shares could be to vote such shares in favor of the initial business combination and thereby increase the likelihood of obtaining shareholder approval of the initial business combination or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public rights could be to reduce the number of public rights, or the securities underlying them, that are outstanding. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public "float" of our ordinary shares or rights may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Redemption rights for public shareholders upon completion of our initial business combination We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.15 per public share if the underwriters over-allotment option is exercised in full together with up to an additional $0.0333 per public share per one-month extension in the event that our sponsor elects to extend the period of time to consummate a business combination as described in more details in this prospectus. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. The redemption rights will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. There will be no redemption rights upon the completion of our initial business combination with respect to our rights. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares, private placement shares and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination. 20 Manner of conducting redemptions We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a general meeting called to approve the business combination or (ii) by means of a tender offer. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under the law or stock exchange listing requirement. Asset acquisitions and share purchases would not typically require shareholder approval, while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our issued and outstanding ordinary shares or seek to amend our amended and restated memorandum and articles of association would require shareholder approval. We currently intend to conduct redemptions in connection with a shareholder vote unless shareholder approval is not required by applicable law or stock exchange listing requirement and we choose to conduct redemptions pursuant to the tender offer rules of the SEC for business or other legal reasons. So long as we obtain and maintain a listing for our securities on the Nasdaq, we will be required to comply with such rules. If shareholder approval of the transaction is required by law or stock exchange listing requirement, or we decide to obtain shareholder approval for business or other legal reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and file proxy materials with the SEC. We expect that a final proxy statement would be mailed to public shareholders at least 10 days prior to the shareholder vote. However, we expect that a draft proxy statement would be made available to such shareholders well in advance of such time, providing additional notice of redemption if we conduct redemptions in conjunction with a proxy solicitation. Although we are not required to do so, we currently intend to comply with the substantive and procedural requirements of Regulation 14A in connection with any shareholder vote even if we are not able to maintain our Nasdaq listing or Exchange Act registration. If we seek shareholder approval, we will complete our initial business combination only if we obtain the approval of an ordinary resolution under Cayman Islands law, being the affirmative vote of a majority of the ordinary shares represented in person or by proxy and entitled to vote thereon and who vote at a general meeting in favor of the business combination. In such case, pursuant to the terms of a letter agreement entered into with us, our sponsor, officers and directors have agreed (and their permitted transferees will agree) to vote any founder shares and private placement shares held by them and any public shares purchased during or after this offering in favor of our initial business combination. We expect that at the time of any shareholder vote relating to our initial business combination, our initial shareholders and their permitted transferees will own at least 20% of our issued and outstanding ordinary shares entitled to vote thereon. Each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction. 21 If a shareholder vote is not required and we do not decide to hold a shareholder vote for business or other legal reasons, we will, pursuant to our amended and restated memorandum and articles of association: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Such provisions may be amended if approved by holders of a majority of our ordinary shares entitled to vote thereon. Whether or not we maintain our registration under the Exchange Act or our listing on Nasdaq, we will provide our public shareholders with the opportunity to redeem their public shares by one of the two methods listed above. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase our Class A ordinary shares in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering more than a specified number of public shares, which number will be based on the requirement that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions (so that we are not subject to the SEC s "penny stock" rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. If public shareholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination. If, however, shareholder approval of the transaction is required by law or stock exchange listing requirements, or we decide to obtain shareholder approval for business or other reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and file proxy materials with the SEC. 22 If we seek shareholder approval, we will complete our initial business combination only if a majority of the outstanding ordinary shares voted are voted in favor of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the company representing a majority of the voting power of all outstanding shares of capital stock of the company entitled to vote at such meeting. Our initial shareholders will count toward this quorum and, pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote their founder shares, private placement shares and any public shares purchased during or after this offering (including in open market and privately negotiated transactions) in favor of our initial business combination. For purposes of seeking approval of the majority of our outstanding shares of capital stock voted, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. As a result, in addition to our initial shareholders founder shares and private placement shares, we would need only approximately 334,051, or 3.3% of the 10,000,000 public shares sold in this offering to be voted in favor of an initial business combination, or 284,051, or approximately 2.8%, if the holders of the representative s shares also choose to vote in favor of the business combination (assuming only a quorum is present at the meeting and only a majority of shares present are required to approve the business combination) in order to have our initial business combination approved (assuming the over-allotment option is not exercised). We intend to give approximately 30 days (but not less than 10 days nor more than 60 days) prior written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination. These quorum and voting thresholds, and the voting agreements of our initial shareholders, may make it more likely that we will consummate our initial business combination. Each public shareholder may elect to redeem its public shares irrespective of whether they vote for or against the proposed transaction. Our amended and restated memorandum and articles of association will provide that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions (so that we are not subject to the SEC s "penny stock" rules). Redemptions of our public shares may also be subject to a higher net tangible asset test or cash requirement pursuant to an agreement relating to our initial business combination. For example, the proposed business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration we would be required to pay for all ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all ordinary shares submitted for redemption will be returned to the holders thereof. 23 Tendering share certificates in connection with a tender offer or redemption rights We may require our public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in "street name," to either tender their certificates (if any) to our transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up to two business days prior to the vote on the proposal to approve our initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically using The Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option, rather than simply voting against the initial business combination. The tender offer or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public shareholders to satisfy such delivery requirements. Limitation on redemption rights of shareholders holding more than 15% of the shares sold in this offering if we hold shareholder vote Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a "group" (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering. We may waive this restriction in our sole discretion. We believe the restriction described above will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our sponsor or its affiliates to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us or our sponsor or its affiliates at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Our sponsor, officers and directors have, pursuant to a letter agreement entered into with us, waived their right to have any founder shares, private placement shares or public shares held by them redeemed in connection with our initial business combination. Unless any of our other affiliates acquires founder shares through a permitted transfer from an initial shareholder, and thereby becomes subject to the letter agreement, no such affiliate is subject to this waiver. However, to the extent any such affiliate acquires public shares in this offering or thereafter through open market purchases, it would be a public shareholder and subject to the 15% limitation in connection with any such redemption right. 24 Redemption Rights in connection with proposed amendments to our amended and restated memorandum and articles of association Our amended and restated memorandum and articles of association will provide that any of its provisions, including those related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the private placement units into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public shareholders as described herein and in our amended and restated memorandum and articles of association), may be amended if approved by holders of at least two-thirds of our ordinary shares who attend and vote in a general meeting, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of 65% of our ordinary shares. Should our sponsor vote all its shares in favor of any such amendment, we would require 5,502,501, or 55.03%, of the public shares issued in this offering to be voted in favor of any such amendment for its approval (assuming no exercise of the underwriters overallotment option and no purchase by our sponsor or its affiliates or our officers and directors or their respective affiliates of public shares in this offering or thereafter). We may not issue additional securities that can vote on amendments to our amended and restated memorandum and articles of association or in our initial business combination. Our initial shareholders, which will beneficially own 20% of our ordinary shares upon the closing of this offering (assuming it does not purchase units in this offering), will participate in any vote to amend our amended and restated memorandum and articles of association and/or trust agreement and will have the discretion to vote in any manner it chooses. Our sponsor, officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association that would (i) modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering as described in more detail in this prospectus if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus) or (ii) with respect to the other provisions relating to shareholders rights or pre-business combination activity, unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares, private placement shares and public shares in connection with the completion of our initial business combination. 25 Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, all amounts held in the trust account will be released to us, other than funds the trustee will use to pay amounts due to any public shareholders who exercise their redemption rights as described above under "Redemption rights for public shareholders upon completion of our initial business combination." We will use the remaining funds to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our sponsor, officers, and directors have agreed that we will have only 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus) to complete our initial business combination. If we are unable to complete our initial business combination within such 12-month period (or up to 18-month period), we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable, and less up to $150,000 of interest to pay dissolution expenses) divided by the number of then issued and outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our rights, which will expire worthless if we fail to complete our initial business combination within the 12-month (or up to 18-month) time period. 26 Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to their founder shares and private placement shares if we fail to complete our initial business combination within 12 months from the closing of this offering (or 13 to 18 months from the closing of this offering if we extend the period of time to consummate a business combination as described in more detail in this prospectus). However, if our sponsor, officers or directors acquire public shares after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted 12-month (or up to 18-month) time frame. Our sponsor, officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association that would (i) modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering as described in more detail in this prospectus if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus) or (ii) with respect to the other provisions relating to shareholders rights or pre-business combination activity, unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares. However, we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions (so that we are not subject to the SEC s "penny stock" rules). The underwriters have agreed to waive their rights to their deferred underwriting commission held in the trust account in the event we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus) and subsequently liquidate and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. 27 Ability to extend time to complete business combination If we anticipate that we may not be able to consummate our initial business combination within 12 months, our insiders or their affiliates may, but are not obligated to, extend the period of time to consummate a business combination up to six times by an additional one month each time (for a total of up to 18 months to complete a business combination), subject to the deposit of additional funds into the trust account by our sponsor or its affiliates or designees as further described below. Holders of our securities will not have the right to approve or disapprove any such one-month extension or have the right to seek or obtain redemption in connection with any such extension, except in connection with a charter amendment. The ability to extend the time to consummate our initial business combination is contingent upon our sponsor or its affiliates or designees, upon five days advance notice prior to the applicable deadline, depositing into the trust account $333,334 (or $383,334 if the underwriters over-allotment option is exercised in full) or approximately $0.0333 per public share in either case, on or prior to the date of the applicable deadline for each extension. Unlike many other SPAC offerings, investors in our company holding our Class A ordinary shares will not have the right to approve any extension or seek or obtain redemption of their Class A ordinary shares. Any such payments would be made in the form of a loan. The terms of the promissory note to be issued in connection with any such loans have not yet been negotiated, but such loans would be interest free and would be paid only if we consummate a business combination. If we complete our initial business combination, we would repay such loaned amounts out of the proceeds of the trust account released to us. Alternatively, such loans may be repaid from funds which may be raised in any subsequent capital financing transaction which may be undertaken in connection with the completion of a business combination. If we do not complete a business combination, we will not repay such loans. Furthermore, the letter agreement with our initial shareholders contains a provision pursuant to which our sponsor has agreed to waive its right to be repaid for such loans in the event that we do not complete a business combination and have waived any claims against the trust account. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. Our public shareholders will not be entitled to vote or redeem their shares in connection with any such extension. As a result, we may conduct such an extension even though a majority of our public shareholders do not support such an extension and will not be able to redeem their shares in connection therewith. Limited payments to insiders There will be no finder s fees, reimbursements or cash payments made to our sponsor, officers or directors, or our or their affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination, other than the following payments, none of which will be made from the proceeds of this offering and the sale of the private placement units held in the trust account prior to the completion of our initial business combination: repayment of an aggregate of up to $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; 28 payment to our sponsor of $10,000 per month, from the effective date of the registration statement of which this prospectus forms a part and for up to 12 months (or up to 18 months if we extend the time to complete our initial business combination) following the completion of this offering for the provision of office space, administrative and support services. None of our officers has received cash compensation for services rendered to us. The services to be provided by the officers shall include evaluation of potential business combination opportunities, preparation of financial reports, SEC and regulatory compliance and any other administrative functions that pertain to the operation of the Company. As we are a shell company, these officers may have obligations to other entities, and the officers are not required to allocate a minimum percentage of time to our Company; reimbursement for certain out-of-pocket expenses related to identifying, investigating and completing an initial business combination; repayment of loans made by our sponsor or its designees at the closing of our initial business combination in connection with extensions of the period of time to consummate a business combination (as described in more detail in this prospectus); and repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into units at a price of $10.00 per unit at the option of the lender (which, for example, would result in the holders being issued 150,000 units, if $1,500,000 of loans were so converted). Such units would be identical to the private placement units. The terms of such working capital loans by our sponsor or its affiliates, or our officers and directors, if any, have not been determined and no written agreements exist with respect to such loans. These payments may be funded using the net proceeds of this offering and the sale of the private placement units not held in the trust account or, upon completion of the initial business combination, from any amounts remaining from the proceeds of the trust account released to us in connection therewith. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliates. Audit committee Prior to the effectiveness of this registration statement, we will have established and will maintain an audit committee (which will be composed entirely of independent directors), to among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled "Management — Committees of the Board of Directors — Audit Committee." 29 Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party (other than our independent auditors) for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (i) $10.15 per public share or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes. This liability will not apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third party claims. Because we are a blank check company, rather than an operating company, and our operations will be limited to searching for prospective target businesses to acquire, the only third parties we currently expect to engage would be vendors such as lawyers, investment bankers, computer or information and technical services providers or prospective target businesses. We have not independently verified whether our sponsor has sufficient funds to satisfy their indemnity obligations and believe that our sponsor s only assets are securities of our company. We have not asked our sponsor to reserve for such obligations. Conflicts of Interest Each of our officers and directors presently has, and in the future any of our directors and our officers may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present acquisition opportunities to such entity. Accordingly, subject to his or her fiduciary duties under Cayman Islands law, if any of our officers or directors becomes aware of an acquisition opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she will need to honor his or her fiduciary or contractual obligations to present such acquisition opportunity to such entity, and only present it to us if such entity rejects the opportunity. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and us, on the other. We do not believe, however, that any fiduciary duties or contractual obligations of our directors or officers would materially undermine our ability to complete our business combination. 30 Summary Financial Data The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. March 31, 2022 Actual As Adjusted Balance Sheet Data: Working (deficiency) capital(1) $ (688,150 ) $ 800,726 Total assets(2) 713,376 102,300,726 Total liabilities(3) 688,650 3,592,500 Value of public shares subject to possible redemption(4) - 101,500,000 Shareholders equity (deficit)(5) 24,726 (2,791,774 ) (1) The "as adjusted" calculation includes the $776,000 held outside of the trust account, plus $24,726 of actual shareholders' equity at March 31, 2022. (2) The "as adjusted" calculation equals $101,500,000 cash held in trust from the proceeds of this offering and the sale of the placement units, plus the $776,00 of cash held outside of the trust account, plus $24,726 of actual shareholders equity as of March 31, 2022. (3) The "as adjusted" calculation includes $3,500,000 of deferred underwriting commissions, plus the estimated fair value of the over allotment option liability of $92,500, assuming the over allotment option is not excercised. (4) The "as adjusted" value of the 10,000,000 public shares which are subject to redemption multiplied by the redemption price of $10.15. (5) Excludes 10,000,000 public shares which are subject to redemption in connection with our initial business combination. The "as adjusted" calculation equals the "as adjusted" total assets, less the "as adjusted" total liabilities, less the value of Class A ordinary shares that may be redeemed in connection with our initial business combination (initially $10.15 per share). The actual number of public shares that may be redeemed may exceed the aforementioned amount provided that we will not consummate an initial business combination unless we satisfy the $5,000,001 minimum net tangible assets threshold. We will consummate our initial business combination only if we have net tangible assets of at least $5,000,001 either immediately prior to or upon such consummation and, solely if we seek shareholder approval, a majority of the outstanding ordinary shares are voted in favor of the business combination. 31 Cautionary Note Regarding Forward-Looking Statements Some statements contained in this prospectus are forward-looking in nature. Our forward-looking statements include, but are not limited to, statements regarding our or our management team s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "intends," "may," "might," "plan," "possible," "potential," "predict," "project," "should," "would" and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. The forward-looking statements contained in this prospectus are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, the following risks, uncertainties and other factors: our being a company with no operating history and no revenues; our ability to select an appropriate target business or businesses; our ability to complete our initial business combination; our expectations around the performance of the prospective target business or businesses; our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination; our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our initial business combination, as a result of which they may then receive expense reimbursements; our potential ability to obtain additional financing to complete our initial business combination; our pool of prospective target businesses; our ability to consummate an initial business combination due to the continued uncertainty resulting from the COVID-19 pandemic; the ability of our officers and directors to generate a number of potential acquisition opportunities; our public securities potential liquidity and trading; the lack of a market for our securities; the use of proceeds not held in the trust account or available to us from interest income on the trust account balance; the trust account not being subject to claims of third parties; risks and uncertainties related to the block chain and semiconductor industries; our financial performance following this offering; and the other risks and uncertainties discussed in "Risk Factors" and elsewhere in this prospectus. Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. 32 Risk Factors An investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together with the other information contained in this prospectus, before making a decision to invest in our units. If any of the following events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. Risks Relating to our Search for a Business Combination, Ability to Consummate a Business Combination and Our Post-Business Combination Operations We are a blank check company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. We are a blank check company incorporated under the laws of the Cayman Islands with no operating results, and we will not commence operations until obtaining funding through this offering. Because we lack an operating history, you have no basis upon which to evaluate our ability to achieve our business objective of completing our initial business combination. We have no plans, arrangements or understandings with any prospective target business concerning a business combination and may be unable to complete our initial business combination. If we fail to complete our initial business combination, we will never generate any operating revenues. Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the COVID-19 outbreak and the status of debt and equity markets. The COVID-19 outbreak has resulted in, and any significant outbreak of another infectious disease could result in, a widespread health crisis that has and may continue to adversely affect the global economy and many of our potential target businesses. Furthermore, we may be unable to complete an initial business combination if concerns relating to COVID-19 continue to restrict travel, limit the ability to have meetings with potential investors, limit the ability to conduct due diligence or limit the ability of a potential target company s personnel, vendors or services providers to negotiate and consummate a transaction in a timely manner. The extent to which COVID-19 will impact our search for an initial business combination will depend on future developments, which are highly uncertain and cannot be predicted. If the disruptions posed by COVID-19 or other matters of global concern continue, our ability to consummate a business combination, or the operations of one or more target businesses, may be materially adversely affected. In addition, our ability to consummate a transaction may be dependent on the ability to raise equity and debt financing which may be impacted by COVID-19 and other events, which may lead to increased market volatility, decreased market liquidity and third-party financing being unavailable on terms acceptable to us or at all. Finally, the outbreak of COVID-19 or other infectious diseases may have the effect of heightening other risks described in this "Risk Factors" section, such as those related to the market for our securities. We may have a limited ability to assess the management of a prospective target business and, as a result, may affect our initial business combination with a target business whose management may not have the skills, qualifications or abilities to manage a public company. When evaluating the desirability of effecting our initial business combination with a prospective target business, our ability to assess the target business s management may be limited due to a lack of time, resources or information. Our assessment of the capabilities of the target business s management, therefore, may prove to be incorrect and such management may lack the skills, qualifications or abilities we suspected. Should the target business s management not possess the skills, qualifications or abilities necessary to manage a public company, the operations and profitability of the post-combination business may be negatively impacted. Accordingly, any shareholders who choose to remain shareholders following the business combination could suffer a reduction in the value of their shares. Such shareholders are unlikely to have a remedy for such reduction in value unless they are able to successfully claim that the reduction was due to the breach by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they are able to successfully bring a private claim under securities laws that the proxy solicitation or tender offer materials, as applicable, relating to the business combination contained an actionable material misstatement or material omission. 33 Our public shareholders may not be afforded an opportunity to vote on our proposed business combination, which means we may complete our initial business combination even though a majority of our public shareholders do not support such a combination. We may not hold a shareholder vote to approve our initial business combination unless the business combination would require shareholder approval under applicable Cayman Islands law or the rules of the Nasdaq or if we decide to hold a shareholder vote for business or other reasons. Examples of transactions that would not ordinarily require shareholder approval include asset acquisitions and share purchases, while transactions such as direct mergers with our company or transactions where we issue more than 20% of our outstanding shares would require shareholder. For instance, the Nasdaq rules currently allow us to engage in a tender offer in lieu of a general meeting but would still require us to obtain shareholder approval if we were seeking to issue more than 20% of our outstanding shares to a target business as consideration in any business combination. Therefore, if we were structuring a business combination that required us to issue more than 20% of our outstanding shares, we would seek shareholder approval of such business combination. Except as required by law or Nasdaq rules, the decision as to whether we will seek shareholder approval of a proposed business combination or will allow shareholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors, such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek shareholder approval. Accordingly, we may consummate our initial business combination even if holders of a majority of the issued and outstanding ordinary shares do not approve of the business combination we consummate. Please see the section entitled "Proposed Business — Effecting Our Initial Business Combination — Shareholders may not have the ability to approve our initial business combination" for additional information. Although we have identified general criteria and guidelines that we believe are important in evaluating prospective target businesses, we may enter into our initial business combination with a target that does not meet such criteria and guidelines, and as a result, the target business with which we enter into our initial business combination may not have attributes entirely consistent with our general criteria and guidelines. Although we have identified general criteria and guidelines for evaluating prospective target businesses, it is possible that a target business with which we enter into our initial business combination will not have all of these positive attributes. If we complete our initial business combination with a target that does not meet some or all of these guidelines, such combination may not be as successful as a combination with a business that does meet all of our general criteria and guidelines. In addition, if we announce a prospective business combination with a target that does not meet our general criteria and guidelines, a greater number of shareholders may exercise their redemption rights, which may make it difficult for us to meet any closing condition with a target business that requires us to have a minimum net worth or a certain amount of cash. In addition, if shareholder approval of the transaction is required by law, or we decide to obtain shareholder approval for business or other legal reasons, it may be more difficult for us to attain shareholder approval of our initial business combination if the target business does not meet our general criteria and guidelines. If we are unable to complete our initial business combination, our public shareholders may receive only approximately $10.15 per share on the liquidation of our trust account and our rights will expire worthless. As the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets. This could increase the cost of our initial business combination. In recent years, the number of special purpose acquisition companies that have been formed has increased substantially. Many potential targets for special purpose acquisition companies have already entered into an initial business combination, and there are still many special purpose acquisition companies seeking targets for their initial business combination. As a result, at times, fewer attractive targets may be available, and it may require more time and more effort to identify a suitable target. In addition, because there are more special purpose acquisition companies seeking to enter into an initial business combination with available targets, the competition for available targets with attractive fundamentals could increase, which could cause targets to demand improved financial terms. Attractive deals could also become scarcer for other reasons, such as economic or industry sector downturns or increases in the cost of additional capital needed to close business combinations or operate targets post-business combination. This could increase the cost of, delay or otherwise complicate or frustrate our initial business combination. 34 Our sponsor has the right to extend the term we have to consummate our initial business combination, without providing our shareholders with redemption rights. We will have 12 months from the closing of this offering to consummate our initial business combination, unless such period is extended. If we anticipate that we may not be able to consummate our initial business combination within 12 months, our sponsor may, but is not obligated to, extend the period of time to consummate a business combination up to six times by an additional one month each time (for a total of up to 18 months to complete a business combination), subject to the deposit of additional funds into the trust account by our sponsor or its affiliates or designees. Holders of our securities will not have the right to approve or disapprove any such one-month extension or have the right to seek or obtain redemption in connection with any such extension, except in connection with a charter amendment. Any such payments would be made in the form of a non-interest-bearing loan from our sponsor or its affiliates or designees and would be repaid, if at all, from funds released to us upon completion of our initial business combination. The obligation to repay any such loans may reduce the amount available to us to pay as purchase price in our initial business combination, and/or may reduce the amount of funds available to the combined company following the initial business combination. This feature is different than the traditional special purpose acquisition company structure, in which any extension of the company s period to complete a business combination requires a vote of the company s shareholders and shareholders have the right to redeem their public shares in connection with such vote, and which do not provide the sponsor with the right to loan funds to the company to fund extension payments. In order to extend the time to consummate an initial business combination, for each one-month extension, our sponsor or its affiliates or designees must deposit into the trust account $333,334 (or $383,334 if the underwriters over-allotment option is exercised in full) or approximately $0.0333 per public share in either case per month, on or prior to the date of the applicable deadline. Your only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash, unless we seek shareholder approval of the business combination. At the time of your investment in us, you will not be provided with an opportunity to evaluate the specific merits or risks of one or more target businesses. Since our board of directors may complete a business combination without seeking shareholder approval, public shareholders may not have the right or opportunity to vote on the business combination, unless we seek such shareholder approval. Accordingly, if we do not seek shareholder approval, your only opportunity to affect the investment decision regarding a potential business combination may be limited to exercising your redemption rights within the period of time (which will be at least 20 business days) set forth in our tender offer documents mailed to our public shareholders in which we describe our initial business combination. The ability of our public shareholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combination with a target. We may seek to enter into a business combination transaction agreement with a prospective target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. If too many public shareholders exercise their redemption rights, we would not be able to meet such closing condition and, as a result, would not be able to proceed with the business combination. Furthermore, we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions (so that we are not subject to the SEC s "penny stock" rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. Consequently, if accepting all properly submitted redemption requests would cause our net tangible assets to be less than $5,000,001 or such greater amount necessary to satisfy a closing condition, each as described above, we would not proceed with such redemption and the related business combination and may instead search for an alternate business combination. Prospective targets will be aware of these risks and, thus, may be reluctant to enter into a business combination transaction with us. 35 The ability of our public shareholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure. At the time we enter into an agreement for our initial business combination, we will not know how many shareholders may exercise their redemption rights, and therefore we will need to structure the transaction based on our expectations as to the number of shares that will be submitted for redemption. If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the trust account to meet such requirements, or arrange for third party financing. In addition, if a larger number of shares are submitted for redemption than we initially expected, we may need to restructure the transaction to reserve a greater portion of the cash in the trust account or arrange for third party financing. Raising additional third party financing may involve dilutive equity issuances or the incurrence of indebtedness at higher than desirable levels. Furthermore, this dilution would increase to the extent that the anti-dilution provisions of the Class B ordinary shares result in the issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion of the Class B shares at the time of the initial business combination. The above considerations may limit our ability to complete the most desirable business combination available to us or optimize our capital structure. The ability of our public shareholders to exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares. If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have a minimum amount of cash at closing, the probability that our initial business combination would be unsuccessful is increased. If our initial business combination is unsuccessful, you would not receive your pro rata portion of the trust account until we liquidate the trust account. If you are in need of immediate liquidity, you could attempt to sell your shares in the open market; however, at such time our shares may trade at a discount to the pro rata amount per share in the trust account. In either situation, you may suffer a material loss on your investment or lose the benefit of funds expected in connection with our redemption until we liquidate or you are able to sell your shares in the open market. The requirement that we complete our initial business combination within the prescribed time frame may give potential target businesses leverage over us in negotiating a business combination and may decrease our ability to conduct satisfactory due diligence on potential business combination targets as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our shareholders. Any potential target business with which we enter into negotiations concerning a business combination will be aware that we must complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus). Consequently, such target business may obtain leverage over us in negotiating a business combination, knowing that if we do not complete our initial business combination with that particular target business, we may be unable to complete our initial business combination with any target business. This risk will increase as we get closer to the timeframe described above. In addition, we may have limited time to conduct due diligence and may enter into our initial business combination on terms that we would have rejected upon a more comprehensive investigation. 36 We may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public shareholders may only receive $10.15 per share, or less than such amount in certain circumstances, and our rights will expire worthless. Our sponsor, officers and directors have agreed that we must complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus). We may not be able to find a suitable target business and complete our initial business combination within such time period. If we have not completed our initial business combination within such time period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable, and less up to $100,000 of interest to pay dissolution expenses) divided by the number of then issued and outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. In such case, our public shareholders may only receive $10.15 per share, and our rights will expire worthless. In certain circumstances, our public shareholders may receive less than $10.15 per share on the redemption of their shares. See "— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less than $10.15 per share" and other risk factors herein. If we seek shareholder approval of our initial business combination, our sponsor, directors, officers and their affiliates may elect to purchase shares from public shareholders, which may influence a vote on a proposed business combination and reduce the public "float" of our ordinary shares. If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, officers or their respective affiliates may purchase shares or rights in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination, although they are under no obligation to do so. Please see "Proposed Business — Permitted purchases of our securities" for a description of how such persons will determine which shareholders to seek to acquire shares from. Such a purchase may include a contractual acknowledgement that such shareholder, although still the record holder of our shares is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights. In the event that our sponsor, directors, officers, or their respective affiliates purchase shares in privately negotiated transactions from public shareholders who have already elected to exercise their redemption rights, such selling shareholders would be required to revoke their prior elections to redeem their shares. The price per share paid in any such transaction may be different than the amount per share a public shareholder would receive if it elected to redeem its shares in connection with our initial business combination. The purpose of such purchases could be to vote such shares in favor of the business combination and thereby increase the likelihood of obtaining shareholder approval of the business combination or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. This may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public "float" of our ordinary shares and the number of beneficial holders of our securities may be reduced, possibly making it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. If a shareholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for tendering its shares, such shares may not be redeemed. We will comply with the tender offer rules or proxy rules, as applicable, when conducting redemptions in connection with our initial business combination. Despite our compliance with these rules, if a shareholder fails to receive our tender offer or proxy materials, as applicable, such shareholder may not become aware of the opportunity to redeem its shares. In addition, the tender offer documents or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will describe the various procedures that must be complied with in order to validly tender or redeem public shares. In the event that a shareholder fails to comply with these procedures, its shares may not be redeemed. See "Proposed Business — Business Strategy — Tendering share certificates in connection with a tender offer or redemption rights." 37 You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. To liquidate your investment, therefore, you may be forced to sell your public shares or rights, potentially at a loss. Our public shareholders will be entitled to receive funds from the trust account only upon the earlier to occur of: (i) the completion of our initial business combination, (ii) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association to (A) modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering as described in more detail in this prospectus if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus) or (B) with respect to any other provision relating to shareholders rights or pre-business combination activity and (iii) the redemption of all of our public shares if we are unable to complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the maximum amount as described in more detail in this prospectus), subject to applicable law and as further described herein. In no other circumstances will a public shareholder have any right or interest of any kind in the trust account. Accordingly, to liquidate your investment, you may be forced to sell your public shares or rights, potentially at a loss. You will not be entitled to protections normally afforded to investors of many other blank check companies. Since the net proceeds of this offering and the sale of the private placement units are intended to be used to complete an initial business combination with a target business that has not been identified, we may be deemed to be a "blank check" company under the United States securities laws. However, because we will have net tangible assets in excess of $5,000,000 upon the successful completion of this offering and the sale of the private placement units and will file a Current Report on Form 8-K, including an audited balance sheet demonstrating this fact, we are exempt from rules promulgated by the SEC to protect investors in blank check companies, such as Rule 419. Accordingly, investors will not be afforded the benefits or protections of those rules. Among other things, this means our units will be immediately tradable and we will have a longer period of time to complete our initial business combination than do companies subject to Rule 419. Moreover, if this offering were subject to Rule 419, that rule would prohibit the release of any interest earned on funds held in the trust account to us unless and until the funds in the trust account were released to us in connection with our completion of an initial business combination. For a more detailed comparison of our offering to offerings that comply with Rule 419, please see "Proposed Business — Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419." Our public shareholders will not be entitled to vote or redeem their shares in connection with our potential extensions. If we anticipate that we may not be able to consummate our initial business combination within 12 months, we may, by resolution of our board if requested by our sponsor, extend the period of time to consummate a business combination up to six times, each by an additional one month (for a total of up to 18 months to complete an initial business combination). Our public shareholders will not be entitled to vote or redeem their shares in connection with any such extension. As a result, we may conduct such an extension even though a majority of our public shareholders do not support such an extension. This feature is different than the traditional special purpose acquisition company structure, in which any extension of the company s period to complete a combination requires a vote of the company s shareholders and shareholders have the right to redeem their public shares in connection with such vote. 38 Our sponsor may decide not to extend the term we have to consummate our initial business combination, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate, and the rights will be worthless. We will have 12 months from the closing of this offering to consummate our initial business combination, unless such period is extended. If we anticipate that we may not be able to consummate our initial business combination within 12 months, our sponsor may, but is not obligated to, extend the period of time to consummate a business combination up to six times by an additional one month each time (for a total of up to 18 months to complete a business combination), subject to the deposit of additional funds into the trust account by our sponsor or its affiliates or designees as further described below. Holders of our securities will not have the right to approve or disapprove any such one-month extension or have the right to seek or obtain redemption in connection with any such extension, except in connection with a charter amendment. The ability to extend the time to consummate our initial business combination is contingent upon our sponsor or its affiliates or designees, upon five days advance notice prior to the applicable deadline, depositing into the trust account $333,334 (or $383,334 if the underwriters over-allotment option is exercised in full) or approximately $0.0333 per public share in either case, on or prior to the date of the applicable deadline for each extension. In the event that we receive notice from our sponsor for any such extension, we intend to issue a press release announcing such intention prior to the applicable deadline. In addition, we intend to issue a press release following the applicable deadline announcing whether or not the funds had been timely deposited. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to consummate our initial business combination. If we are unable to consummate our initial business combination within the applicable time period, we will, as promptly as reasonably possible but not more than five business days thereafter, redeem the public shares for a pro rata portion of the funds held in the trust account and as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. In such event, the rights will be worthless. If the net proceeds of this offering and the sale of private placement units not being held in the trust account are insufficient to allow us to operate for at least the next 12 months (or 13 to 18 months, as applicable) from the closing of this offering, we may be unable to complete our initial business combination, in which case our public shareholders may only receive $10.15 per share, or less than such amount in certain circumstances, and our rights will expire worthless. The funds available to us outside of the trust account may not be sufficient to allow us to operate for at least the next 12 months, assuming that our initial business combination is not completed during that time. We expect to incur significant costs in pursuit of our acquisition plans. Management s plans to address this need for capital through this offering and potential loans from certain of our affiliates are discussed in the section of this prospectus titled "Management s Discussion and Analysis of Financial Condition and Results of Operations." However, our affiliates are not obligated to make loans to us in the future, and we may not be able to raise additional financing from unaffiliated parties necessary to fund our expenses. Any such event in the future may negatively impact the analysis regarding our ability to continue as a going concern at such time. We believe that, upon the closing of this offering, the funds available to us outside of the trust account, will be sufficient to allow us to operate for at least the next 12 months; however, we cannot assure you that our estimate is accurate. Of the funds available to us, we could use a portion of the funds available to us to pay fees to consultants to assist us with our search for a target business. We could also use a portion of the funds as a down payment or to fund a "no-shop" provision (a provision in letters of intent designed to keep target businesses from "shopping" around for transactions with other companies on terms more favorable to such target businesses) with respect to a particular proposed business combination, although we do not have any current intention to do so. If we entered into a letter of intent where we paid for the right to receive exclusivity from a target business and were subsequently required to forfeit such funds (whether as a result of our breach or otherwise), we might not have sufficient funds to continue searching for, or conduct due diligence with respect to, a target business. If we are unable to complete our initial business combination, our public shareholders may receive only approximately $10.15 per share (or less in certain circumstances) on the liquidation of our trust account and our rights will expire worthless. In such case, our public shareholders may only receive $10.15 per share, and our rights will expire worthless. In certain circumstances, our public shareholders may receive less than $10.15 per share on the redemption of their shares. See "— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less than $10.15 per share" and other risk factors herein. 39 If we are unable to complete our initial business combination, our public shareholders may receive only approximately $10.15 per share, or less in certain circumstances, on our redemption, and our rights will expire worthless. We expect to encounter intense competition from other entities having a business objective similar to ours, including private investors (which may be individuals or investment partnerships), other blank check companies and other entities, domestic and international, competing for the types of businesses we intend to acquire. Many of these individuals and entities are well-established and have extensive experience in identifying and effecting, directly or indirectly, acquisitions of companies operating in or providing services to various industries. Many of these competitors possess greater technical, human and other resources or more local industry knowledge than we do and our financial resources will be relatively limited when contrasted with those of many of these competitors. While we believe there are numerous target businesses we could potentially acquire with the net proceeds of this offering and the sale of the private placement units, our ability to compete with respect to the acquisition of certain target businesses that are sizable will be limited by our available financial resources. This inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target businesses. Furthermore, if we are obligated to pay cash for the ordinary shares redeemed and, in the event we seek shareholder approval of our initial business combination, we make purchases of our ordinary shares, potentially reducing the resources available to us for our initial business combination. Any of these obligations may place us at a competitive disadvantage in successfully negotiating a business combination. If we are unable to complete our initial business combination, our public shareholders may receive only approximately $10.15 per share (or less in certain circumstances) on the liquidation of our trust account and our rights will expire worthless. In certain circumstances, our public shareholders may receive less than $10.15 per share on the redemption of their shares. See "— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less than $10.15 per share" and other risk factors herein. If the net proceeds of this offering and the sale of the private placement units not being held in the trust account are insufficient, it could limit the amount available to fund our search for a target business or businesses and complete our initial business combination and we will depend on loans from our sponsor or management team to fund our search, to pay our taxes and to complete our initial business combination. Of the net proceeds of this offering and the sale of the private placement units, only approximately $1,000,000 will be available to us initially outside the trust account to fund our working capital requirements. In the event that our offering expenses exceed our estimate of $1,000,000, we may fund such excess with funds not to be held in the trust account. In such case, the amount of funds we intend to be held outside the trust account would decrease by a corresponding amount. Conversely, in the event that the offering expenses are less than our estimate of $1,000,000, the amount of funds we intend to be held outside the trust account would increase by a corresponding amount. If we are required to seek additional capital, we would need to borrow funds from our sponsor, management team or other third parties to operate or may be forced to liquidate. Neither our sponsor, members of our management team nor any of their affiliates is under any obligation to advance funds to us in such circumstances. Any such advances would be repaid only from funds held outside the trust account or from funds released to us upon completion of our initial business combination. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the trust account. Consequently, our public shareholders may only receive approximately $10.15 per share (or less in certain circumstances) on our redemption of our public shares, and our rights will expire worthless. In such case, our public shareholders may only receive $10.15 per share, and our rights will expire worthless. In certain circumstances, our public shareholders may receive less than $10.15 per share on the redemption of their shares. See "— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less than $10.15 per share" and other risk factors herein. 40 Subsequent to the completion of our initial business combination, we may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on our financial condition, results of operations and our share price, which could cause you to lose some or all of your investment. Even if we conduct extensive due diligence on a target business with which we combine, we cannot assure you that this diligence will surface all material issues that may be present inside a particular target business, that it would be possible to uncover all material issues through a customary amount of due diligence, or that factors outside of the target business and outside of our control will not later arise. As a result of these factors, we may be forced to later write-down or write-off assets, restructure our operations, or incur impairment or other charges that could result in our reporting losses. Even if our due diligence successfully identifies certain risks, unexpected risks may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though these charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative market perceptions about us or our securities. In addition, charges of this nature may cause us to violate net worth or other covenants to which we may be subject as a result of assuming pre-existing debt held by a target business or by virtue of our obtaining post-combination debt financing. Accordingly, any shareholders who choose to remain shareholders following the business combination could suffer a reduction in the value of their shares. Such shareholders are unlikely to have a remedy for such reduction in value. If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less than $10.15 per share. Our placing of funds in the trust account may not protect those funds from third-party claims against us. Although we will seek to have all vendors, service providers (other than our independent auditors), prospective target businesses or other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our public shareholders, such parties may not execute such agreements, or even if they execute such agreements they may not be prevented from bringing claims against the trust account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain advantage with respect to a claim against our assets, including the funds held in the trust account. If any third party refuses to execute an agreement waiving such claims to the monies held in the trust account, our management will perform an analysis of the alternatives available to it and will only enter into an agreement with a third party that has not executed a waiver if management believes that such third party s engagement would be significantly more beneficial to us than any alternative. Examples of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third party consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver. In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason. Upon redemption of our public shares, if we are unable to complete our initial business combination within the prescribed timeframe, or upon the exercise of a redemption right in connection with our initial business combination, we will be required to provide for payment of claims of creditors that were not waived that may be brought against us within the 10 years following redemption. Accordingly, the per-share redemption amount received by public shareholders could be less than the $10.15 per share initially held in the trust account, due to claims of such creditors. Our sponsor has agreed that it will be liable to us if and to the extent any claims by a vendor (other than our independent auditors) for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (i) $10.15 per public share or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third party claims. We have not independently verified whether our sponsor has sufficient funds to satisfy their indemnity obligations and believe that our sponsor s only assets are securities of our company. Our sponsor may not have sufficient funds available to satisfy those obligations. We have not asked our sponsor to reserve for such obligations, and therefore, no funds are currently set aside to cover any such obligations. As a result, if any such claims were successfully made against the trust account, the funds available for our initial business combination and redemptions could be reduced to less than $10.15 per public share. In such event, we may not be able to complete our initial business combination, and you would receive such lesser amount per share in connection with any redemption of your public shares. None of our officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses. 41 Our directors may decide not to enforce the indemnification obligations of our sponsor, resulting in a reduction in the amount of funds in the trust account available for distribution to our public shareholders. In the event that the proceeds in the trust account are reduced below the lesser of (i) $10.15 per public share or (ii) such lesser amount per share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes, and our sponsor asserts that it is unable to satisfy its obligations or that it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take legal action against our sponsor to enforce its indemnification obligations. While we currently expect that our independent directors would take legal action on our behalf against our sponsor to enforce its indemnification obligations to us, it is possible that our independent directors in exercising their business judgment may choose not to do so in any particular instance. If our independent directors choose not to enforce these indemnification obligations, the amount of funds in the trust account available for distribution to our public shareholders may be reduced below $10.15 per share. If, after we distribute the proceeds in the trust account to our public shareholders, we file a bankruptcy or winding-up petition or an involuntary bankruptcy or winding-up petition is filed against us that is not dismissed, a bankruptcy or insolvency court may seek to recover such proceeds, and the members of our board of directors may be viewed as having breached their fiduciary duties to our creditors, thereby exposing the members of our board of directors and us to claims of punitive damages. If, after we distribute the proceeds in the trust account to our public shareholders, we file a bankruptcy or winding-up petition or an involuntary bankruptcy or winding-up petition is filed against us that is not dismissed, any distributions received by shareholders could be viewed under applicable debtor/creditor and/or bankruptcy or insolvency laws as either a "preferential transfer" or a "fraudulent conveyance." As a result, a bankruptcy or insolvency court could seek to recover all amounts received by our shareholders. In addition, our board of directors may be viewed as having breached its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing itself and us to claims of punitive damages, by paying public shareholders from the trust account prior to addressing the claims of creditors. If, before distributing the proceeds in the trust account to our public shareholders, we file a bankruptcy or winding-up petition or an involuntary bankruptcy or winding-up petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our shareholders and the per-share amount that would otherwise be received by our shareholders in connection with our liquidation may be reduced. If, before distributing the proceeds in the trust account to our public shareholders, we file a bankruptcy or winding-up petition or an involuntary bankruptcy or winding-up petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable bankruptcy or insolvency laws, and may be included in our bankruptcy or insolvency estate and subject to the claims of third parties with priority over the claims of our shareholders. To the extent any bankruptcy or insolvency claims deplete the trust account, the per-share amount that would otherwise be received by our shareholders in connection with our liquidation may be reduced. Our shareholders may be held liable for claims by third parties against us to the extent of distributions received by them upon redemption of their shares. If we are forced to enter into an insolvent liquidation, any distributions received by shareholders could be viewed as an unlawful payment if it was proved that immediately following the date on which the distribution was made, we were unable to pay our debts as they fall due in the ordinary course of business. As a result, a liquidator could seek to recover all amounts received by our shareholders. Furthermore, our directors may be viewed as having breached their fiduciary duties to us or our creditors and/or may have acted in bad faith, and thereby exposing themselves and our company to claims, by paying public shareholders from the trust account prior to addressing the claims of creditors. We cannot assure you that claims will not be brought against us for these reasons. We and our directors and officers who knowingly and willfully authorized or permitted any distribution to be paid out of our share premium account while we were unable to pay our debts as they fall due in the ordinary course of business would be guilty of an offence and may be liable to a fine of up to $18,292 and to imprisonment for five years in the Cayman Islands. 42 We may not hold an annual general meeting until after the consummation of our initial business combination. Our public shareholders will not have the right to appoint directors prior to the consummation of our initial business combination. In accordance with Nasdaq corporate governance requirements, we are not required to hold an annual general meeting until no later than one year after our first fiscal year end following our listing on the Nasdaq. There is no requirement under the Companies Act for us to hold annual general meetings in order to appoint directors. Until we hold an annual general meeting, public shareholders may not be afforded the opportunity to discuss company affairs with management. Because we are not limited to a particular industry or any specific target businesses with which to pursue our initial business combination, you will be unable to ascertain the merits or risks of any particular target business s operations. We may pursue acquisition opportunities in any one of numerous industries, except that we will not, under our amended and restated memorandum and articles of association, be permitted to effectuate our business combination with another blank check company or similar company with nominal operations. Because we have not yet identified or approached any specific target business with respect to a business combination, there is no basis to evaluate the possible merits or risks of any particular target business s operations, results of operations, cash flows, liquidity, financial condition or prospects. To the extent we complete our business combination, we may be affected by numerous risks inherent in the business operations with which we combine. For example, if we combine with a financially unstable business or an entity lacking an established record of sales or earnings, we may be affected by the risks inherent in the business and operations of a financially unstable or an early stage entity. Although our officers and directors will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all of the significant risk factors or that we will have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability to control or reduce the chances that those risks will adversely impact a target business. We also cannot assure you that an investment in our units will ultimately prove to be more favorable to investors than a direct investment, if such opportunity were available, in a business combination target. Accordingly, any shareholders who choose to remain shareholders following the business combination could suffer a reduction in the value of their shares. Such shareholders are unlikely to have a remedy for such reduction in value unless they are able to successfully claim that the reduction was due to the breach by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they are able to successfully bring a private claim under securities laws that the tender offer materials or proxy statement relating to the business combination contained an actionable material misstatement or material omission. We may seek acquisition opportunities in industries or sectors that may be outside of our management s areas of expertise. We will consider a business combination outside of our management s areas of expertise if a business combination candidate is presented to us and we determine that such candidate offers an attractive acquisition opportunity for our company. In the event we elect to pursue an acquisition outside of the areas of our management s expertise, our management s expertise may not be directly applicable to its evaluation or operation, and the information contained in this prospectus regarding the areas of our management s expertise would not be relevant to an understanding of the business that we elect to acquire. As a result, our management may not be able to adequately ascertain or assess all of the significant risk factors. Accordingly, any shareholders who choose to remain shareholders following our initial business combination could suffer a reduction in the value of their shares. Such shareholders are unlikely to have a remedy for such reduction in value. We may seek acquisition opportunities with a financially unstable business or an entity lacking an established record of revenue or earnings. To the extent we complete our initial business combination with a financially unstable business or an entity lacking an established record of sales or earnings, we may be affected by numerous risks inherent in the operations of the business with which we combine. These risks include volatile revenues or earnings and difficulties in obtaining and retaining key personnel. Although our officers and directors will endeavor to evaluate the risks inherent in a particular target business, we may not be able to properly ascertain or assess all of the significant risk factors and we may not have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability to control or reduce the chances that those risks will adversely impact a target business. 43 We are not required to obtain an opinion from an independent investment banking or from an independent accounting firm, and consequently, you may have no assurance from an independent source that the price we are paying for the business is fair to our company from a financial point of view. Unless we complete our business combination with an affiliated entity, or our board of directors cannot independently determine the fair market value of the target business or businesses, we are not required to obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or from an independent accounting firm that the price we are paying for a target is fair to our company from a financial point of view. If no opinion is obtained, our shareholders will be relying on the judgment of our board of directors, who will determine fair market value based on standards generally accepted by the financial community. Such standards used will be disclosed in our tender offer documents or proxy solicitation materials, as applicable, related to our initial business combination. However, if our board of directors is unable to determine the fair value of an entity with which we seek to complete an initial business combination based on such standards, we will be required to obtain an opinion as described above. Because we must furnish our shareholders with target business financial statements, we may lose the ability to complete an otherwise advantageous initial business combination with some prospective target businesses. The federal proxy rules require that a proxy statement with respect to a vote on a business combination include historical and pro forma financial statement disclosure in periodic reports. We will include the same financial statement disclosure in connection with our tender offer documents, whether or not they are required under the tender offer rules. These financial statements may be required to be prepared in accordance with, or be reconciled to, accounting principles generally accepted in the United States of America, or U.S. GAAP, or international financial reporting standards as issued by the International Accounting Standards Board, or IFRS, depending on the circumstances and the historical financial statements may be required to be audited in accordance with the standards of the Public Company Accounting Oversight Board (United States), or PCAOB. These financial statement requirements may limit the pool of potential target businesses we may acquire because some targets may be unable to provide such financial statements in time for us to disclose such statements in accordance with federal proxy rules and complete our initial business combination within the prescribed time frame. Compliance obligations under the Sarbanes-Oxley Act may make it more difficult for us to effectuate our initial business combination, require substantial financial and management resources, and increase the time and costs of completing an acquisition. Section 404 of the Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls beginning with our Annual Report on Form 10-K for the year ending December 31, 2023. Only in the event we are deemed to be a large accelerated filer or an accelerated filer, and no longer qualify as an emerging growth company, will we be required to comply with the independent registered public accounting firm attestation requirement on our internal control over financial reporting. Further, for as long as we remain an emerging growth company, we will not be required to comply with the independent registered public accounting firm attestation requirement on our internal control over financial reporting. The fact that we are a blank check company makes compliance with the requirements of the Sarbanes-Oxley Act particularly burdensome on us as compared to other public companies because a target company with which we seek to complete our initial business combination may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of its internal controls. The development of the internal control of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such acquisition. 44 We do not have a specified maximum redemption threshold. The absence of such a redemption threshold may make it possible for us to complete a business combination with which a substantial majority of our shareholders do not agree. Our amended and restated memorandum and articles of association will not provide a specified maximum redemption threshold, except that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions (such that we are not subject to the SEC s "penny stock" rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. As a result, we may be able to complete our initial business combination even though a substantial majority of our public shareholders do not agree with the transaction and have redeemed their shares or, if we seek shareholder approval of our initial business combination and do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, have entered into privately negotiated agreements to sell their shares to our sponsor, directors, officers, or their respective affiliates. In the event the aggregate cash consideration we would be required to pay for all ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, all ordinary shares submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate business combination. In order to effectuate an initial business combination, blank check companies have, in the recent past, amended various provisions of their charters and modified governing instruments. We cannot assure you that we will not seek to amend our amended and restated memorandum and articles of association or governing instruments in a manner that will make it easier for us to complete our initial business combination that our shareholders may not support. In order to effectuate a business combination, blank check companies have, in the past, amended various provisions of their charters and modified governing instruments. For example, blank check companies have amended the definition of business combination, increased redemption thresholds and extended the period of time in which it had to consummate a business combination. We cannot assure you that we will not seek to amend our amended and restated memorandum and articles of association or governing instruments or extend the time in which we have to consummate a business combination through amending our amended and restated memorandum and articles of association will require at least a special resolution of our shareholders as a matter of Cayman Islands law. The provisions of our amended and restated memorandum and articles of association that relate to our pre-initial business combination activity (and corresponding provisions of the agreement governing the release of funds from our trust account), including an amendment to permit us to withdraw funds from the trust account such that the per share amount investors will receive upon any redemption or liquidation is substantially reduced or eliminated, may be amended with the approval of holders of at least two-thirds of our ordinary shares who attend and vote in a general meeting, which is a lower amendment threshold than that of some other blank check companies. It may be easier for us, therefore, to amend our amended and restated memorandum and articles of association and the trust agreement to facilitate the completion of an initial business combination that some of our shareholders may not support. Our amended and restated memorandum and articles of association will provide that any of its provisions, including those related to pre-initial business combination activity (including the requirement to deposit proceeds of this offering and the private placement of rights into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public shareholders as described herein and in our amended and restated memorandum and articles of association or an amendment to permit us to withdraw funds from the trust account such that the per share amount investors will receive upon any redemption or liquidation is substantially reduced or eliminated), may be amended if approved by holders of at least two-thirds of our ordinary shares who attend and vote in a general meeting, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of 65% of our ordinary shares. Should our sponsor vote all its shares in favor of any such amendment, we would require 5,502,501, or 55.03%, of the public shares issued in this offering to be voted in favor of any such amendment for its approval (assuming no exercise of the underwriters overallotment option and no purchase by our sponsor or its affiliates or our officers and directors or their respective affiliates of public shares in this offering or thereafter). We may not issue additional securities that can vote on amendments to our amended and restated memorandum and articles of association. Our initial shareholders, which will collectively beneficially own 20% of our ordinary shares upon the closing of this offering (assuming they do not purchase any units in this offering), will participate in any vote to amend our amended and restated memorandum and articles of association and/or trust agreement and will have the discretion to vote in any manner it chooses. As a result, we may be able to amend the provisions of our amended and restated memorandum and articles of association which govern our pre-business combination behavior more easily than some other blank check companies, and this may increase our ability to complete a business combination with which you do not agree. Our shareholders may pursue remedies against us for any breach of our amended and restated memorandum and articles of association. 45 We may be unable to obtain additional financing to complete our initial business combination or to fund the operations and growth of a target business, which could compel us to restructure or abandon a particular business combination. Although we believe that the net proceeds of this offering and the sale of the private placement units will be sufficient to allow us to complete our initial business combination, because we have not yet identified any prospective target business we cannot ascertain the capital requirements for any particular transaction. If the net proceeds of this offering and the sale of the private placement units prove to be insufficient, either because of the size of our initial business combination, the depletion of the available net proceeds in search of a target business, the obligation to redeem for cash a significant number of shares from shareholders who elect redemption in connection with our initial business combination or the terms of negotiated transactions to purchase shares in connection with our initial business combination, we may be required to seek additional financing or to abandon the proposed business combination. We cannot assure you that such financing will be available on acceptable terms, if at all. To the extent that additional financing proves to be unavailable when needed to complete our initial business combination, we would be compelled to either restructure the transaction or abandon that particular business combination and seek an alternative target business candidate. In addition, even if we do not need additional financing to complete our initial business combination, we may require such financing to fund the operations or growth of the target business. The failure to secure additional financing could have a material adverse effect on the continued development or growth of the target business. None of our officers, directors or shareholders is required to provide any financing to us in connection with or after our initial business combination. If we are unable to complete our initial business combination, our public shareholders may only receive approximately $10.15 per share on the liquidation of our trust account, and our rights will expire worthless. In certain circumstances, our public shareholders may receive less than $10.15 per share on the redemption of their shares. See "— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less than $10.15 per share" and other risk factors below. Resources could be wasted in researching acquisitions that are not completed, which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. If we are unable to complete our initial business combination, our public shareholders may receive only approximately $10.15 per share, or less than such amount in certain circumstances, on the liquidation of our trust account and our rights will expire worthless. We anticipate that the investigation of each specific target business and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments will require substantial management time and attention and substantial costs for accountants, attorneys and others. If we decide not to complete a specific initial business combination, the costs incurred up to that point for the proposed transaction likely would not be recoverable. Furthermore, if we reach an agreement relating to a specific target business, we may fail to complete our initial business combination for any number of reasons including those beyond our control. Any such event will result in a loss to us of the related costs incurred which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. If we are unable to complete our initial business combination, our public shareholders may receive only approximately $10.15 per share on the liquidation of our trust account and our rights will expire worthless. See "— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001874944_vacasa-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001874944_vacasa-inc_prospectus_summary.txt
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+prospectus summary, that represent challenges that we face in connection with the successful implementation of our strategy and the growth of our business. In particular, the following considerations, among others, may offset our competitive strengths or have a negative effect on our business strategy, which could cause a decline in the price of our Class A Common Stock and result in a loss of all or a portion of your investment: We have incurred net losses in each year since inception, and we may not be able to achieve profitability; Our recent growth may not be indicative of our future growth, and we may not be able to sustain a similar revenue growth rate in the future. Our recent growth also makes it difficult to evaluate our current business and future prospects and may increase the risk that we will not be successful; If we are unable to attract new vacation rental homeowners to our platform and maintain relationships with existing vacation rental homeowners, or if homeowners reduce the availability of their homes on our platform, our business, results of operations, and financial condition would be materially adversely affected; If we are unable to attract new guests and retain existing guests, our business, results of operations, and financial condition would be materially adversely affected; Bookings through our distribution partners account for a significant portion of our revenue, and if we are unable to maintain our relationships with our existing distribution partners and develop and maintain successful relationships with additional distribution partners, our business, results of operations, and financial condition would be materially adversely affected. These relationships also subject us to certain risks; Any further and continued decline or disruption to the travel and hospitality industries or economic downturn would materially adversely affect our business, results of operations, and financial condition; Our continued growth depends, in part, on our ability to consummate portfolio transactions and to effectively manage the risks associated with these transactions; Our failure to raise additional capital or generate the significant capital necessary to expand our operations and invest in new offerings could reduce our ability to compete and could adversely affect our business; 1 Table of Contents The business and industry in which we participate are highly competitive, and we may be unable to compete successfully with our current or future competitors; The COVID-19 pandemic and the impact of actions to mitigate the COVID-19 pandemic have materially adversely impacted and will continue to materially adversely impact our business, results of operations, and financial condition; We may experience significant fluctuations in our results of operations from quarter to quarter and year to year as a result of seasonality and other factors, which make it difficult to forecast our future results; Demand for vacation rental properties has increased in recent periods compared to demand for other forms of accommodations, and we cannot guarantee that this trend will continue once the COVID-19 pandemic subsides; If we fail to comply with federal, state, and foreign laws relating to privacy and data protection, we may face potentially significant liability, negative publicity, an erosion of trust, and increased regulation, any of which could materially adversely affect our business, results of operations, and financial condition; If we or our third-party service providers fail to prevent data security breaches, there may be damage to our brand and reputation, material financial penalties, and legal liability, along with a decline in use of our platform, which would materially adversely affect our business, results of operations, and financial condition; System capacity constraints, system or operational failures, or denial-of-service or other attacks could materially adversely affect our business, results of operations, and financial condition; If we do not adequately protect our intellectual property and our data, our business, results of operations, and financial condition could be materially adversely affected; Laws, regulations, and rules that affect the short-term rental business have limited and may continue to limit the ability or willingness of homeowners to rent through Vacasa and expose our homeowners or us to significant penalties, which have had and could continue to have a material adverse effect on our business, results of operations, and financial condition; We are subject to a wide variety of complex, evolving, and sometimes inconsistent and ambiguous laws and regulations that may adversely impact our operations and discourage homeowners and guests from using our services, and that could cause us to incur significant liabilities including fines and criminal penalties, which could have a material adverse effect on our business, results of operations, and financial condition; We rely on a mix of independent contractors and employees to provide operational services to us, and any potential reclassification of independent contractors as deemed employees could adversely affect our business, results of operations and financial condition; Uncertainty in the application of taxes to our homeowners, guests, or platform could increase our tax liabilities and may discourage homeowners and guests from conducting business on our platform; Changes in tax laws or tax rulings could materially affect our business, results of operations, and financial condition; Our principal stockholders have significant influence over us, including over decisions that require the approval of stockholders, and their interests may conflict with yours; and We are an emerging growth company within the meaning of the Securities Act, and as a result of the reduced disclosure and governance requirements applicable to emerging growth companies, our Class A Common Stock may be less attractive to investors. 2 Table of Contents Corporate Information Vacasa, Inc. is a Delaware corporation. Vacasa, Inc. was originally formed on July 1, 2021 under the name Voyage Newco, Inc., for purposes of consummating the Business Combination with TPG Pace, a blank check company incorporated as a Cayman Islands exempted company incorporated on January 4, 2021. In July 2021, Voyage Newco, Inc. changed its name to Vacasa, Inc. Our principal executive offices are located at 850 NW 13th Avenue, Portland, Oregon 97209, and our telephone number is (503) 345-9399. Our website address is www.vacasa.com. Information contained on our website is not a part of this prospectus, and the inclusion of our website address in this prospectus is an inactive textual reference only. Emerging Growth Company We are an emerging growth company, as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act ) are required to comply with the new or revised financial accounting standards. As of January 1, 2022, we have elected to irrevocably opt out of this extended transition period. We will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year following the fifth anniversary of the closing of TPG Pace s initial public offering, the base offering of which closed on April 13, 2021, (b) in which we have total annual gross revenue of at least $1.07 billion or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common equity that is held by non-affiliates exceeds $700 million prior to June 30th; and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. 3 Table of Contents
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: we, us, our, company or our company are to LIV Capital Acquisition Corp. II, a Cayman Islands exempted company; amended and restated memorandum and articles of association are to our memorandum and articles of association to be in effect upon completion of this offering; Class A ordinary shares are to our Class A ordinary shares, par value $0.0001 per share; Class B ordinary shares are to our Class B ordinary shares, par value $0.0001 per share; Companies Act are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; directors are to our current directors; EBC founder shares are to the 160,000 Class A ordinary shares that we issued to EarlyBirdCapital, Inc. and its designees prior to this offering; founders shares are to our Class B ordinary shares initially purchased by our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination (for the avoidance of doubt, such Class A ordinary shares will not be public shares ); initial shareholders are to our sponsor and other holders of our founders shares prior to this offering, but excludes EarlyBirdCapital, Inc. in respect of the EBC founder shares; letter agreement refers to the letter agreement entered into between us and our initial shareholders, directors and officers on or prior to the date of this prospectus, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team are to our officers and directors and any other advisors described in the Management section of this prospectus; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering, as well as any warrants issued upon conversion of working capital loans; public shares are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders are to the holders of our public shares, including our sponsor, officers and directors to the extent our sponsor, officers or directors purchase public shares, provided their status as a public shareholder shall only exist with respect to such public shares; sponsor are to LIV Capital Acquisition Sponsor II, L.P., a Cayman Islands exempted limited partnership; warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and the private warrants; and $, US$ and U.S. dollar each refer to the United States dollar. 1 Table of Contents Any conversion of the Class B ordinary shares described in this prospectus will take effect as a redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. All references in this prospectus to shares of the Company being forfeited shall take effect as surrenders for no consideration of such shares as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as a share capitalization as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriter will not exercise the over-allotment option and the resulting forfeiture by our sponsor of 375,000 founders shares. General We are a newly incorporated blank check company incorporated as a Cayman Islands exempted company and formed for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. To date, our efforts have been limited to organizational activities and activities related to this offering. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. Our sponsor is an affiliate of LIV Capital, a private investment firm founded in 2000 in order to make equity investments in high-growth businesses in Mexico or with a significant presence in that country. LIV Capital has a deep history of successfully realizing returns on equity investments in a range of Mexican sectors and companies and investing in various phases of growth and maturity. As a result, LIV Capital has established itself as one of the main investment advisers in the country, raising several institutional funds. Throughout its operating history of more than twenty years, LIV Capital has raised, administered and invested in six funds, focusing on Mexican companies and/or companies with a significant presence in Mexico. Alexander R. Rossi, Humberto Zesati and Miguel ngel D vila, whom we refer to as our LIV Capital Directors, have substantial experience and expertise in the Mexican corporate market where they have served as investors, operators, administrators and advisors. Collectively, our LIV Capital Directors have made private equity investments in more than 20 companies and have transactional experience in more than 35 Mexican companies and 100 Latin American and U.S. companies. Together, our LIV Capital Directors have more than 90 years of professional experience. LIV Capital and the LIV Capital Directors were instrumental in launching LIV Capital Acquisition Corp. ( LIV Capital Acquisition Corp. I ), a special purpose acquisition company that completed its initial public offering in December 2019, generating aggregate proceeds of $80,050,000 (after giving effect to the full exercise of the over-allotment). On August 23, 2021, LIV Capital Acquisition Corp. I successfully closed its business combination with AgileThought, Inc., a Delaware corporation ( AgileThought ) and a leading pure-play provider of agile-first software at scale, end-to-end digital transformation, and consulting services to Fortune 1000 customers with diversity across end-markets and industry verticals. AgileThought trades on Nasdaq under the ticker AGIL. While we may pursue a business combination target in any business, industry or geographical location, we intend to focus our search on Mexican target businesses or target businesses with a significant presence in Mexico. We intend to identify and acquire a business that could benefit from leveraging our extensive operational, capital markets and investment management experience in the Mexican and Latin American markets and that presents the potential for an attractive risk-adjusted return profile under our management. We will seek to capitalize on Mexico s growing and underinvested sectors, by seeking to meet the capital needs of high potential middle-market companies that are well positioned in the competitive local and regional landscape and that have the potential to thrive as public businesses. LIV Capital has a dedicated operations team that initially assists in due diligence processes and oversees the onboarding of new investments, negotiates with management teams, assess key valuation metrics and develops initiatives to enhance the performance of the invested companies. We anticipate utilizing LIV Capital s platform to provide us with access to its team, deal prospects and network, along with any necessary resources to aid in the identification, diligence and operational support of a target for our initial business combination. 2 Table of Contents Mexico currently represents an attractive investment destination, underpinned by stable macroeconomic fundamentals. The country had a US$1.08 trillion economy as of 2020. From an economic growth perspective, Mexico has delivered consistent results, with positive growth in gross domestic product from 2010 to 2020. Gross domestic product for 2020 decreased due to COVID-19, but 2021 showed a fast recovery with a year-over-year growth of 5.9%. Despite current challenges in the global supply chain and uncertainty relating to the effects of COVID-19, we expect growth to continue in the years ahead. We expect the new treaty called the United States-Mexico-Canada Agreement ( USCMA ) to be a major growth catalyst. This recent development is likely to reaffirm Mexico s position as a significant export-oriented manufacturing country and an important supply chain hub for industries ranging from automobiles, to oil & gas and to electronics. As of October 2021, Mexico was the United States top trading partner, on a year-to-date basis, accounting for $545.5 billion in total trade (imports plus exports). Mexico s commitment to drive economic growth through global trade is further evidenced by its globally integrated economy, with 13 free trade agreements with 50 countries, 32 Reciprocal Investment Promotion and Protection Agreements ( RIPPAs ) with 33 countries, and nine trade agreements (Economic Complementation and Partial Scope Agreements), including the USCMA and Trans-Pacific Partnership among others. Mexico continues to strengthen its international reserves, from $180.7 billion in 2019 to $185.2 billion as of September 2021 and 61% of Mexico s net debt comes from domestic issued debt. Our LIV Capital Directors share a long collaboration history, having worked together for approximately 21 years. Since its formation in early 2000, LIV Capital has raised six funds totalling $375 million in committed capital, which includes equity funds focused on investing in growth stage companies and a venture capital fund. LIV Capital has become an institutionalized platform with the direction and leadership of our LIV Capital Directors, as well as with the support of highly qualified internal investment, finance, legal, investor relations and support teams, that are integral to the platform s success. Notwithstanding the foregoing, the past performance of our LIV Capital Directors and other members of our management team is not a guarantee that we will be able to identify a suitable candidate for our initial business combination or of success with respect to any business combination we may consummate. You should not rely on the historical record of our management s performance as indicative of our future performance. Target Business Focus We intend to focus our search on Mexican target businesses or target businesses with a significant presence in Mexico. However, we are not limited to companies in this geographic area. We believe that there is a rich opportunity to focus on many Mexican growth-stage businesses that have limited access to credit or other capital sources, and that have high-growth prospects and proven business models and are led by qualified entrepreneurs and/or strong management teams that focus on value creation. This, we believe, will in turn result in the potential for attractive entry valuations and a favorable investment climate for providers of intelligent capital. Mexico is an emerging economy with high rates of growth projected for innovative businesses and relatively scarce equity financing available. We intend to capitalize on this unfulfilled equity demand. Mexico has established operators seeking access to capital and managerial expertise. We intend to leverage our team s collective managerial, operational, financial and transactional expertise to build a strong business with competitive advantages to emerge as a leading public company. We believe that many companies will need a partner that can assist in providing a level of operational and financial expertise to support their growth. Our team includes a variety of professionals who will assist a target business access the public markets. Our team consists of professionals who have decades of experience in capital markets globally. In addition, we intend to provide not only specific operating expertise, but also strategic, marketing and planning guidance in conjunction with high-level access to relevant industry players. We will seek to play an active role in the institutionalization of the target company, not only in terms of corporate governance and information compliance, but also in strengthening management capacity by leading the selection of key individuals that complement the skills of existing teams. Further, we believe that through our extensive networks and recognized position in the industry, we will also help foster new sales, suppliers and strategic relationship opportunities, including joint ventures, acquisitions and other partnerships that represent significant value creation opportunities for the target company. 3 Table of Contents Our acquisition plan is to utilize our management team s networks of potential transaction sources where we believe a combination of our management team s relationships, knowledge and experience could affect a positive transformation or augmentation of existing businesses or assets. Over the course of their careers, the members of our management team have developed a broad network of contacts and corporate relationships that we believe will serve as a useful source of acquisition opportunities. We plan to leverage relationships with management teams of public and private companies, investment professionals at private equity firms and other financial sponsors, institutional investors, development banks, owners of private businesses, investment bankers, restructuring advisers, consultants, attorneys and accountants, which we believe should provide us with numerous business combination opportunities. Following the completion of this offering, the members of our management team plan to communicate with their networks of relationships to articulate the parameters for our search for a target business and a potential business combination and begin the process of pursuing and reviewing potentially interesting leads. Notwithstanding the foregoing, effecting a business combination with a company located in Mexico, or another jurisdiction outside of the United States, could subject us to a variety of additional risks that may negatively impact our operations. See the risk factor titled If we effect a business combination with a company located in Mexico or outside of the United States, we would be subject to a variety of additional risks that may negatively impact our operations for more information on the risks attendant to acquiring a target business. Furthermore, if we determine to acquire a target business located outside of Mexico, the positive aspects of consummating a business combination in Mexico would not be applicable to our business going forward. Acquisition Criteria Consistent with our business strategy, we have identified the following general, non-exclusive criteria and guidelines that we believe are important in evaluating prospective targets for our initial business combination. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target that does not meet one or more of these criteria and guidelines. We expect to weigh potential upside from growth in the target business and an improved capital structure against any identified downside risks. We intend to focus on target businesses that we believe: have the potential to further improve their performance from an active hands-on role in strategic, operational and financial direction. We intend to look for targets that have clear opportunities for long-term sustainable growth that may benefit from our transactional, financial, managerial and investment expertise as well as our extensive networks and insights. We believe our management team has the skills and capabilities to enhance companies results and intend to develop greater managerial depth and sophistication, facilitate new commercial opportunities and work closely with management in designing and executing growth strategies; have a proven business model with consistent operational performance. We expect to target a business that has significant commercial traction, robust growth potential and has historically exhibited profitability or has a clear path towards profitability; have top-tier proven executive management teams. We intend to seek a target that has an experienced managerial group with a clear vision about how to grow their company based on a successful track record of achieving a relevant market position in their industry; exhibit institutional-level operations and financial controls. We intend to seek a target that has the underlying infrastructure and operations to build a public platform; have durable competitive advantages that are differentiated in the sector. We intend to acquire an asset that not only benefits from secular tailwinds in its respective industry, but also exhibit hard-to-replicate competitive advantages amongst its peers; may benefit from capital markets access. We intend to seek a target that may benefit from being, or has the potential to become, a public company with an increased public profile, enhanced corporate governance and increased access to a more diversified pool of capital; and exhibit unrecognized value and desirable returns on capital. We intend to look for targets that we believe have been undervalued by the marketplace based on our analysis and due diligence review. 4 Table of Contents These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general criteria and guidelines as well as other considerations, factors and criteria that our management may deem relevant. We believe our management team s extensive contacts, broad industry knowledge and highly regarded experience will yield a robust deal flow from which we may select a target. We will seek to acquire the target on terms and in a manner that leverages our management team s experience. The potential upside from growth in the target business and an improved capital structure will be weighed against any identified downside risks designed to balance value creation with capital preservation. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria and guidelines in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials that we would file with the SEC. Effecting a Business Combination We will either (1) seek shareholder approval of our initial business combination at a meeting called for such purpose at which shareholders may seek to convert their shares, regardless of whether they vote for or against the proposed business combination or don t vote at all, into their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable), or (2) provide our shareholders with the opportunity to sell their shares to us by means of a tender offer (and thereby avoid the need for a shareholder vote) for an amount equal to their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable), in each case subject to the limitations described herein. The decision as to whether we will seek shareholder approval of our proposed business combination or allow shareholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek shareholder approval. If we decide to allow shareholders to sell their shares to us in a tender offer, we will file tender offer documents with the SEC which will contain substantially the same financial and other information about the initial business combination as is required under the SEC s proxy rules. We will consummate our initial business combination only if we have net tangible assets of at least $5,000,001 either immediately prior to or upon such consummation and, if we seek shareholder approval, a majority of the outstanding ordinary shares voted are voted in favor of the business combination. We will have up to 15 months (extendable at our sponsor s option to up to 18 months, as described below under Description of Securities Our Amended and Restated Memorandum and Articles of Association ) from the closing of this offering to consummate an initial business combination. If we are unable to consummate an initial business combination within such time period (after giving effect to the Extension Period, as applicable), we will redeem 100% of our outstanding public shares for a pro rata portion of the funds held in the trust account, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and as further described herein, and then seek to liquidate and dissolve. We expect the pro rata redemption price to be approximately $10.20 per Class A ordinary share (regardless of whether or not the underwriter exercises its over-allotment option), without taking into account any interest earned on such funds. However, we cannot assure you that we will in fact be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public shareholders. Nasdaq listing rules require that our initial business combination occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (excluding taxes payable on the income earned on the trust account) at the time of the agreement to enter into the initial business combination. The fair market value of the target or targets will be determined by our board of directors based upon one or more standards generally accepted by the financial community (such as actual and potential sales, earnings, cash flow and/or book value). Even though our board of directors will rely on generally accepted standards, our board of directors will have discretion to select the standards employed. In addition, the application of the standards generally involves a substantial degree of judgment. Accordingly, investors will be relying on the business judgment of the board of directors in evaluating the fair market value of the target or targets. The proxy solicitation materials 5 Table of Contents or tender offer documents used by us in connection with any proposed transaction will provide public shareholders with our analysis of the fair market value of the target business, as well as the basis for our determinations. If our board is not independently able to determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm, or another independent entity that commonly renders valuation opinions, with respect to the satisfaction of such criteria. We currently anticipate structuring a business combination to acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination where we merge directly with the target business or a newly formed subsidiary or where we acquire less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we could acquire a 100% controlling interest in the target; however, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% fair market value test. If our initial business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the target businesses. Notwithstanding the foregoing, if we are not then listed on the Nasdaq for whatever reason, we would no longer be required to meet the foregoing 80% fair market value test. Potential Conflicts Members of our management team will directly or indirectly own ordinary shares, or other instruments, such as warrants, linked to our ordinary shares, following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Our sponsor, officers, directors and LIV Capital may participate in the formation of, or become an officer or director of, any other blank check company prior to completion of our initial business combination. However, our officers and directors have agreed to present to us all target business opportunities that have a fair market value of at least 80% of the assets held in the trust account (excluding taxes payable on the income accrued in the trust account), subject to any pre-existing fiduciary or contractual obligations. As more fully discussed in Management Conflicts of Interest, if any of our officers or directors becomes aware of an initial business combination opportunity that may be attractive to any entity to which he has pre-existing fiduciary or contractual obligations, he will be required to present such initial business combination opportunity to such entity prior to presenting such initial business combination opportunity to us. Certain of our officers and directors currently have certain relevant pre-existing fiduciary duties or contractual obligations. Accordingly, they will be required to present all suitable business combination opportunities to such entities prior to presenting them to our company for consideration. For more information on the relevant pre-existing fiduciary duties or contractual obligations of our management team, see the section titled Management Conflicts of Interest. 6 Table of Contents JOBS Act and Other Corporate Information We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that are held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. References herein to emerging growth company have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates is equaled or exceeded $250 million as of the prior June 30, and (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year or the market value of our ordinary shares held by non-affiliates equaled or exceeded $700 million as of the prior June 30. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible. We have filed a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a result, we are subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. We are a Cayman Islands exempted company. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have received a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are a Cayman Islands exempted company incorporated on February 11, 2021. Our executive offices are located at Torre Virreyes, Pedregal No. 24, Piso 6-601, Col. Molino del Rey, M xico, CDMX, C.P. 11040 and our telephone number is +52 55 1100 2470. 7 Table of Contents Private Placements In April 2021, our initial shareholders purchased an aggregate of 2,875,000 Class B ordinary shares, which we refer to throughout this prospectus as the founders shares, for an aggregate purchase price of $25,000, or approximately $0.009 per share, to our initial shareholders. The founders shares held by our initial shareholders includes an aggregate of up to 375,000 shares subject to forfeiture to the extent that the underwriter s over-allotment option is not exercised in full or in part, so that our initial shareholders will own 20.0% of our issued and outstanding shares after this offering (not including the EBC founder shares and assuming the initial shareholders do not purchase units in this offering). We have also issued to EarlyBirdCapital, Inc. and its designees an aggregate of 160,000 Class A ordinary shares, which we refer to throughout this prospectus as the EBC founder shares. The EBC founder shares are deemed to be underwriter s compensation by FINRA pursuant to Rule 5110 of the FINRA Manual. See the section titled Underwriting for further information related to these arrangements. In addition, our sponsor and EarlyBirdCapital, Inc. have committed that they and/or their designees will purchase from us an aggregate of 5,500,000 private warrants (representing 5,000,000 private warrants by our sponsor and 500,000 private warrants by EarlyBirdCapital, Inc.) at $1.00 per warrant for a total purchase price of $5,500,000 in a private placement that will occur simultaneously with the consummation of this offering. The private warrants are identical to the warrants sold in this offering, subject to certain limited exceptions as described in this prospectus. The proceeds from the private placement of the private warrants will be added to the proceeds of this offering and placed in a United States-based trust account maintained by Continental Stock Transfer & Trust Company, as trustee. If we do not complete an initial business combination within 15 months (extendable at our sponsor s option to up to 18 months, as described below under Description of Securities Our Amended and Restated Memorandum and Articles of Association ) from the closing of this offering, the proceeds from the sale of the private warrants will be included in the liquidating distribution to our public shareholders and the private warrants will be worthless. 8 Table of Contents
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+This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information that you should consider before deciding to invest in our Class A common stock. You should read this entire prospectus carefully, including the Risk Factors section, our historical consolidated financial statements and the notes thereto, and unaudited pro forma consolidated financial information, each included elsewhere in this prospectus. Overview We believe we are a leading provider of technology-enabled wealth management solutions and business services for financial advisory firms primarily focused on serving high net worth ( HNW ) and ultra-high net worth ( UHNW ) clients. As defined by Cerulli, HNW clients are identified as those with $5 million or more investable assets and UHNW clients are identified as those with $20 million or more investable assets. We provide access to a comprehensive platform of software and technology tools, business services and holistic investment management capabilities through an open-architecture platform delivered via a suite of proprietary and third-party technologies integrated within the Dynasty Desktop. Our offerings give our advisory firm clients the freedom to address their clients needs in an objective and independent manner. Our technology, tools and services provide advisory firms the supported independence to launch their business, scale their operations and grow their firms both organically and inorganically while also allowing them to be more focused on and better-equipped to serve their clients. The combination of our comprehensive and flexible offering has driven our rapid growth. Since adding our first client in 2011, we have grown to $67.5 billion in Period End Assets Under Administration ( Period End AUA ) as of June 30, 2022. Our Period End AUA increased by $19.8 billion, or 45%, from June 30, 2020 to June 30, 2021, and increased by $4.3 billion, or 7%, from June 30, 2021 to June 30, 2022. As of June 30, 2022, we partner with 48 financial advisory firms ( Network Partner Firms ) representing 319 financial advisors with an average Period End AUA per advisor of $212 million. We provide our Network Partner Firms a comprehensive suite of technology and business solutions that enable them to better serve their clients and run more efficient and higher-growth businesses. Highlights of our solutions include: Core Services. We provide Network Partner Firms the necessary technology solutions and business services to successfully serve their end-clients and grow their business. Our transition and consulting team provides business consulting to financial advisors and financial advisory firms at all stages of their business lifecycle from advisors transitioning to independence, to long established independent advisory firms desiring to scale operations and accelerate growth. In addition, technology underpins the full suite of our Core Services offering and is the foundation of all of the individual components. We enable data-driven critical business processes through cloud-based advanced computing, advanced data management and analytics, data integrations, and cloud-based software as a service ( SaaS ) platforms. Our technology platform provides an integrated experience for the advisor, as well as important technology-driven efficiencies to their businesses. This is augmented by value-added services available to Network Partner Firms including finance, marketing, investments, compliance and practice management. Importantly, working with Dynasty also provides Network Partner Firms access to a community of like-minded entrepreneurs that come together to share ideas and best practices, including at events that we host such as our Annual Partners Summit and Annual Investment Forum. Investment Platform. Our Investment Platform includes our turnkey asset management platform ( TAMP ), which works in concert with our Core Services offering and integrates the research, tools, technology, manager access, operations, and compliance support that allows advisory firms to offer highly professional and scalable investment solutions to their clients. Our investment platform provides comprehensive support, whether advisors choose to manage their own portfolios, select recommended exchange traded funds or separately managed accounts, or outsource some or all aspects of their investment solution to Dynasty s outsourced TABLE OF CONTENTS The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is neither an offer to sell these securities nor a solicitation of an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION PRELIMINARY PROSPECTUS, DATED , 2022 Shares Class A Common Stock This is an initial public offering of shares of Class A common stock of Dynasty Financial Partners Inc. We are offering shares of Class A common stock. Prior to this offering, there has been no public market for our Class A common stock. It is currently estimated that the initial public offering price per share of our Class A common stock will be between $ and $ . We have applied to list our Class A common stock on the NASDAQ Global Market under the symbol DSTY. We intend to use a portion of the net proceeds of this offering to purchase common units of Dynasty Financial Partners, LLC from existing Dynasty Financial Partners, LLC unitholders, at a per-unit price equal to the per-share price paid by the underwriters for shares of the Class A common stock in this offering. We also intend to use a portion of the net proceeds from this offering to purchase newly issued common units from Dynasty Financial Partners, LLC, at a per-unit price equal to the per-share price paid by the underwriters for shares of our Class A common stock in this offering. We expect Dynasty Financial Partners, LLC to use the proceeds for general corporate purposes. In connection with the reorganization transactions taking place contemporaneously with the closing of this offering, members of Dynasty Financial Partners, LLC holding certain Class Q profits interests units will exchange such profits interests units for shares of our Class A common stock. We are a holding company, and upon the closing of this offering and the application of proceeds therefrom our principal asset will be the common units of Dynasty Financial Partners, LLC representing an aggregate % economic interest in Dynasty Financial Partners, LLC. The remaining % economic interest in Dynasty Financial Partners, LLC will be owned by the existing Dynasty Financial Partners, LLC unitholders through their indirect ownership of common units. See the section titled Our Structure and Reorganization. After giving effect to the reorganization and the completion of this offering, we will have shares of Class A common stock outstanding. After giving effect to the reorganization and the completion of this offering, if all of the holders of units of Dynasty Financial Management, LLC, which will be the only other member of Dynasty Financial Partners, Inc. after this offering, exchanged their units for Class A shares of common stock, we would have shares of Class A common stock outstanding on an as-exchanged basis. We are an emerging growth company under the federal securities laws and, as such, are eligible for reduced public company reporting and other requirements. See Risk Factors beginning on page 20 to read about risks you should consider before buying shares of the Class A common stock. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed on the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. Per Share Total Initial public offering price $ $ Underwriting discounts and commissions(1) $ $ Proceeds, before expenses, to Dynasty Financial Partners Inc. $ $ (1) See Underwriting for a description of all compensation to be paid to the underwriters. At our request, Goldman Sachs & Co. LLC, a participating underwriter, has reserved for sale, at the initial public offering price, up to % of the shares offered by this prospectus for sale to certain of our directors, officers, employees, business associates and related persons. If these persons purchase reserved shares it will reduce the number of shares available for sale to the general public. Any reserved shares that are not so purchased will be offered by the underwriters to the general public on the same terms as the other shares offered by this prospectus. For more information regarding the directed share program, see Underwriting Directed Share Program. To the extent that the underwriters sell more than shares of Class A common stock, the underwriters have the option to purchase up to an additional shares from us at the initial public offering price less the underwriting discount within days of the date of this prospectus. The underwriters expect to deliver the shares of Class A common stock against payment on or about , 2022. Joint Book-Running Managers Goldman Sachs & Co. LLC J.P. Morgan Citigroup RBC Capital Markets Co-Managers D.A. Davidson & Co. Keefe, Bruyette & Woods A Stifel Company Maxim Group LLC Prospectus dated , 2022. TABLE OF CONTENTS Through and including , 2022 (the 25th day after the date of this prospectus), all dealers effecting transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to a dealer s obligation to deliver a prospectus when acting as an underwriter and with respect to unsold allotments or subscriptions. We are responsible for the information contained in this prospectus and in any free writing prospectus we may authorize to be delivered to you. We and the underwriters have not authorized anyone to give you any other information, and take no responsibility for any other information that others may give you. We and the underwriters are offering to sell, and seeking offers to buy, shares of our Class A common stock only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of our Class A common stock. Our business, financial condition, results of operations and prospects may have changed since the date set forth on the cover page of this prospectus. Except where the context requires otherwise, in this prospectus: Dynasty, the company, we, us and our refer to Dynasty Financial Partners Inc., a Delaware corporation, and, unless the context otherwise requires, its direct and indirect subsidiaries, and, for periods prior to this offering, Dynasty, the company, we, us and our refer to Dynasty Financial Partners, LLC and, unless the context otherwise requires, its direct and indirect subsidiaries; and Dynasty Financial Partners refers to Dynasty Financial Partners, LLC, a limited liability company organized under the laws of the State of Delaware, and, unless the context otherwise requires, its direct and indirect subsidiaries. Financial Statements and Basis of Presentation This prospectus includes (x) the audited consolidated statements of financial position of Dynasty Financial Partners, LLC as of December 31, 2021 and December 31, 2020 and consolidated statements of comprehensive income, statements of changes in members equity, and statements of cash flows of Dynasty Financial Partners, LLC for the years ended December 31, 2021, December 31, 2020 and December 31, 2019 and (y) the unaudited condensed consolidated statement of financial position of Dynasty Financial Partners, LLC as of June 30, 2022 and unaudited condensed consolidated statements of comprehensive income, unaudited condensed consolidated statements of changes in members equity, and unaudited condensed consolidated statements of cash flows of Dynasty Financial Partners, LLC for the six months ended June 30, 2022 and June 30, 2021. This prospectus also includes (x) the statement of financial position of Dynasty Financial Partners Inc., dated as of December 31, 2021 and September 30, 2021 and (y) the unaudited statement of financial position of Dynasty Financial Partners Inc., dated as of June 30, 2022. The other historical financial information of Dynasty Financial Partners Inc. has not been included in this prospectus as it is a newly incorporated entity, has no business transactions or activities to date and had nominal assets or liabilities during the periods presented in this prospectus. Following the completion of this offering, Dynasty Financial Partners Inc. will be a holding company and its sole material asset will be Class A units of Dynasty Financial Partners, LLC. All of our business has historically been and will continue to be conducted through Dynasty Financial Partners, LLC. The financial results of Dynasty Financial Partners, LLC will be consolidated in the financial statements of Dynasty Financial Partners Inc. following this offering. Following the completion of this offering, we intend to include the financial statements of Dynasty Financial Partners Inc. and its consolidated subsidiaries in our periodic reports and other filings as required by applicable law and the rules and regulations of the SEC. See Management s Discussion and Analysis of Financial Condition and Results of Operations for more information. Trademarks and Trade Names We own or have rights to various trademarks, service marks and trade names that we use in connection with the operation of our business. This prospectus may also contain trademarks, service marks and trade names of third parties, which are the property of their respective owners. Our use or TABLE OF CONTENTS Chief Investment Officer capabilities. When an advisor chooses to use our Chief Investment Officer capabilities, the Company s registered investment advisor Dynasty Wealth Management, LLC serves as an investment sub-adviser to the relevant Network Partner Firm by making investment decisions with respect to the Network Partner Firm s client portfolios and provides execution services for the Network Partner Firm. Our Investment Platform is optimized to facilitate a smooth initial launch for new independent advisory firms. Capital Strategies. We offer our Network Partner Firms a range of financing solutions to help them expand, scale and grow their business. We provide financing in the form of loans, minority equity investments and revenue participation interests to our Network Partner Firms. These solutions are structured to provide a flexible menu of capital options for Network Partner Firms while providing appropriate protections and returns for Dynasty. Our revenue model is primarily composed of fees that are recurring in nature. The primary components of our revenue are generated by our Core Services and Investment Platform offerings which typically charge asset-based fees on the assets under administration ( AUA ) on these platforms, or in limited instances within our Core Services business line as a percentage of total revenue. The remainder of our revenues are generated by fixed fees associated with transition and consulting services and sponsorships of our client events, as well as interest income, revenue share or earnings shares related to our Capital Strategies. In the six months ended June 30, 2022, we generated total revenues of $38.9 million, net income of $7.0 million, adjusted EBITDA of $8.7 million, and adjusted net income of $8.1 million compared with $31.4 million, $6.9 million, $7.5 million, and $7.0 million for the six months ended June 30, 2021, respectively. In the year ended December 31, 2021, we generated total revenues of $69.3 million, net income of $16.0 million, adjusted EBITDA of $18.7 million, and adjusted net income of $17.8 million compared with $46.2 million, $4.8 million, $5.6 million, and $5.0 million for the year ended December 31, 2020, respectively. Market Overview We primarily serve fee-based, independent advisory firms who provide wealth management services to HNW and UHNW investors in the United States. The market for wealth advisory services in the United States is vast, with household net worth of $150 trillion as of December 31, 2021, and according to data from the Federal Reserve, total household net worth in the United States grew at a Compound Annual Growth Rate ( CAGR ) of 8.4% from 2011 to 2021. Approximately 292,000 advisors managed $25.7 trillion of these assets as of December 31, 2020, according to a report by Cerulli, leaving substantial room for growth in Assets under Management ( AUM ). Advisors AUM grew at a 8.0% CAGR during the ten-year period ended December 31, 2020, according to Cerulli data. We are focused on the highest growth areas within the wealth management sector hybrid and independent registered investment advisors ( RIAs ). According to Cerulli data, the RIA channels experienced the largest increase in AUM over the 5 year period ended December 31, 2020; AUM at hybrid and independent RIAs grew at CAGRs of 14.5% and 12.0%, respectively. We target both existing independent wealth management firms and advisory teams who are considering separating from their associated broker-dealer, in each case, that typically have an average AUA of $1,300 million or more. Within the latter group, we target both teams whose clients have outgrown the offerings and client-service levels of the broker-dealer environment and established teams at wirehouse broker-dealers who desire a greater level of independence and autonomy in how they engage with and service their clients. According to Cerulli data, total addressable market for breakaway advisors in terms of assets was $538 billion in 2020. The steady trend of large advisors breaking away has continued, with 33 breakaway transactions of firms with over $1 billion recorded in AUA in 2020. We have been able to capture this momentum in launching 26 breakaway advisor teams with over $500 million in AUA since 2015, 15 of which were over $1 billion in AUA. TABLE OF CONTENTS TABLE OF CONTENTS display of third parties trademarks, service marks or trade names in this prospectus is not intended to, and does not, imply a relationship with, or endorsement or sponsorship by us. Solely for convenience, the trademarks, service marks and trade names referred to in this prospectus may appear without the , TM or SM symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the right of the applicable licensor to these trademarks, service marks and trade names. Market and Industry Data Certain information contained in Summary and Business is based on studies, analyses and surveys prepared by Cerulli Associates, Inc. ( Cerulli ) and other third-party sources. This prospectus includes industry and market data that we obtained from periodic industry publications, third-party studies and surveys, filings of public companies in our industry and internal company data. These sources include government and industry sources. Industry publications and surveys generally state that the information contained therein has been obtained from sources believed to be reliable. Although we believe the industry and market data to be reliable as of the date of this prospectus, this information could prove to be inaccurate. Industry and market data could be wrong because of the method by which sources obtained their data and because information cannot always be verified with complete certainty due to the limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties. In addition, we do not know all of the assumptions regarding general economic conditions or growth that were used in preparing the forecasts from the sources relied upon or cited herein. TABLE OF CONTENTS Our Competitive Strengths For more than a decade, we have championed the benefits of independent wealth management for HNW and UHNW individuals and have contributed to the movement of assets from traditional brokerage channels to the independent channels of wealth management. We are a recognized industry leader and our platform and offering have won multiple awards in recent years. As of June 30, 2022, Network Partner Firms representing more than 319 advisors with $70.8 billion in Billable AUA rely on Dynasty to empower their independence. We believe the following factors drive our competitive strengths: Deep Understanding of Our Clients: Our firm is focused on meeting the needs of wealth advisory firms across their life cycle. This provides us with an in-depth understanding of the needs and challenges that our clients face and makes us well positioned to develop highly attractive products and solutions to meet their needs. This deep understanding has been built through not only our standalone operating history, but the longer-term experience of our management team. Our strong relationship with our clients is evidenced by an average client tenure of over four years. Comprehensive Offering: We provide a full suite of services and technology-enabled solutions that allow advisors to operate, scale and grow independent of the large firms they were captive to previously, enabling them to be more focused on the specialized needs of their clients. The comprehensive nature of our offering positions us to be the single-source service provider to our clients and significantly differentiates us from the disparate point solutions prevalent in the wealth management technology market. Scale Provider: We are able to leverage our size and breadth to invest in maintaining a compelling technology offering while being a partner of choice to third party solution providers to independent wealth firms. This also allows us to offer attractive enterprise-level pricing and customer service to our clients as well as access to products and solutions they may not be able to access on their own. Modular Technology Solution: Our technology offering has been designed to integrate with best-in-class providers of technology solutions for wealth managers, such as customer relationship management, performance reporting, and risk management software. We typically offer two to three options for any solution and are able to replace or add options as the landscape evolves and the technologies at the forefront shift. We continually solicit feedback from our clients on how to improve our technology stack. Because these solutions integrate with the Dynasty front-end platform, these changes can be implemented seamlessly with minimal impact to the end-client experience. Entrepreneurial Culture: We are entrepreneurs serving a community of entrepreneurs. Our platform is designed to empower advisors to become CEOs of their own independent firms. We do not take majority ownership positions or enter into majority revenue sharing arrangements with our partner firms, nor do we ever disincentivize our clients from continuing to grow their firms. This partnership approach results in a culture of independence that promotes entrepreneurship, empowering and incentivizing the owners of our partner firms to focus on growing their businesses and providing superior service to their end-clients. Experienced and Committed Management Team: We are led by industry experts who are committed to the future of the Dynasty network. Members of our management team and board of directors have extensive experience in wealth and asset management at both large broker-dealers and as independent advisors. In addition, key members of the management team have meaningful equity ownership in the company and are dedicated to its continued success. TABLE OF CONTENTS TABLE OF CONTENTS Growth Strategy Core elements of our growth strategy include: Facilitate Existing Network Partner Firm Growth: The success of our clients is our success. Our offerings help our clients grow their AUA both organically and inorganically. Our Network Partner Firms, utilizing our highly scalable technology platform and Capital Strategies offerings are also well positioned to participate in the significant consolidation taking place in the wealth management space. In fiscal years 2020 and 2021, our Network Partner Firms have executed 13 tuck-in acquisitions of advisory practices that collectively managed $6.3 billion in AUA at their prior firms at the time of acquisition. In the six months ended June 30, 2022, our Network Partner Firms have executed 4 tuck-in acquisitions of advisory practices that collectively managed $0.9 billion in AUA at their prior firms at the time of acquisition. According to Cerulli data, as of December 31, 2020, the estimated addressable market for RIA acquisitions over the next 5-10 years was $3.2 trillion in assets, primarily driven by advisor retirements, which we believe will continue to drive growth at our Network Partner Firms and at Dynasty. Onboard New Network Partner Firms: The size of the hybrid and independent channels continues to increase, with AUM growing 14.5% and 12.0%, respectively over the 5 year period ended December 31, 2020, according to Cerulli data. We maintain an active effort to identify and onboard advisors who are contemplating separating from their broker-dealer affiliates, as well as RIAs who are considering changing service providers. In the year ended December 31, 2019, we added 7 new Network Partner Firms to our platform that comprised 22 advisors and $3.9 billion in AUA as of December 31, 2019. In the year ended December 31, 2020, we added 6 new Network Partner Firms that comprised 22 advisors and $2.3 billion in AUA as of December 31, 2020. In the year ended December 31, 2021, we added 7 new Network Partner Firms that comprised 35 advisors and $2.9 billion in AUA as of December 31, 2021. In the six months ended June 30, 2022, we added 3 new Network Partner Firms that comprised 18 advisors and $0.2 billion in Billable AUA as of June 30, 2022. These 23 Network Partner Firms in total comprised 143 advisors and $19.3 billion in Billable AUA as of June 30, 2022. We expect to add incremental AUA going forward from recently added Network Partner Firms which are not reflected in the June 30, 2022 AUA balance. Increase Network Partner Firms Use of Our Broader Capabilities: As of June 30, 2021 and 2022, the percentage of our Billable AUA that utilize our Investment Platform was 48% and 47% respectively, and as of June 30, 2021 and 2022, 21% and 40% of our Network Partner Firms took advantage of our capital solutions, respectively. We continuously work to improve our offerings to gain wallet share from our existing partners. Launch Additional Solutions: We have a history of product innovation since our founding, and we continue to invest in our offerings to better assist advisory firms. An area of increasing focus for us is the generation and nurturing of end-client leads for our network of advisory firms. Complementary Acquisitions: In addition to our investments in our clients, we continually evaluate acquisition opportunities, particularly for further integrating select elements of our technology stack and supply chain that would enable us to better serve advisory firms and further integrate our offerings. We believe we are well positioned to execute accretive acquisitions given our ability to direct new solutions to our large group of Network Partner Firms. Risk Factors An investment in our Class A common stock involves substantial risks and uncertainties. These risks and uncertainties include, among others, the following: Our revenue may fluctuate from period to period, which could cause our share price to fluctuate. TABLE OF CONTENTS TABLE OF CONTENTS We derive a substantial portion of our revenue from the delivery of wealth management solutions to financial advisory firms serving HNW and UHNW clients in the financial advisory industry and our revenue could suffer if that industry experiences a downturn. Changes in market and economic conditions could lower the value of assets on which we earn revenue and could decrease the demand for our wealth management solutions. Our results of operations are heavily dependent on the success of our Network Partner Firms, which are subject to increasing competitive risks, and our results of operations are subject to their operational disruptions or mismanagement. Our success depends, in part, upon our ability to provide attractive opportunities to financial advisors seeking independence from traditional brokerages and wirehouses, and if we are not successful in attracting suitable financial advisors, it may have an adverse effect on the growth of our revenues and earnings. Our growth strategy includes growing through making minority equity investments and providing revenue participation interests in our Network Partner Firms, each of which involve a number of risks. We operate in an intensely competitive industry, with many firms competing for business from financial advisors on the basis of the quality and breadth of wealth management solutions, ability to innovate, reputation and the prices of services, among other factors, and this competition could hurt our financial performance. We must continue to introduce new wealth management solutions, and enhancements thereon, to address our clients changing needs, market changes and technological developments, and a failure to do so could have a material adverse effect on our results of operations, financial condition or business. If our reputation is harmed, our results of operations, financial condition or business could be materially adversely affected. We rely on our key personnel for the stability and growth of our business and future success. Our failure to successfully execute the transition of a Network Partner Firm from their existing platform to our platform in a timely and accurate manner could have a material adverse effect on our results of operations, financial condition or business. We are exposed to data and cybersecurity risks that could result in data breaches and service interruptions, which could cause harm to our reputation or significant liability. Our operations are subject to extensive government regulation, and compliance failures or regulatory action against us could adversely affect our results of operations, financial condition or business. If we are not able to satisfy data protection, security, privacy and other government- and industry-specific requirements, laws or regulations, our results of operations, financial condition or business could be harmed. If we fail to adequately obtain, maintain, protect, enforce or defend our intellectual property and proprietary rights, our competitive position could be impaired, our reputation could be harmed and we may lose valuable assets, generate less revenue and incur costly litigation to protect our rights. If third parties infringe upon our intellectual property or if we were to infringe upon the intellectual property of third parties, we may expend significant resources enforcing or defending our rights or suffer competitive injury. The duration of COVID-19 outbreak and its ultimate impact on our business remains uncertain. Our internal reorganization may adversely affect our relationship with certain employees. Certain existing holders of equity interests in Dynasty Financial Partners will collectively hold a substantial percentage of the voting power of our common stock. TABLE OF CONTENTS We have identified material weaknesses in our internal control over financial reporting. If our remediation of these material weaknesses is not effective, or if we identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, we may not be able to accurately or timely report our financial condition or results of operations. We may be required to register as an investment company under the Investment Company Act if an exclusion or safe harbor currently available to us is no longer available to us, and, as a result, we may become subject to regulatory action or third-party claims, which could have a material adverse effect on our business, results of operations and financial condition. The foregoing is not a comprehensive list of the risks and uncertainties we face. Investors should carefully consider all of the information in this prospectus, including information under Risk Factors, prior to making an investment in our Class A common stock. Our Structure and Reorganization The diagram below depicts our organizational structure immediately after this offering and related transactions. (1) Each share of Class B common stock will entitle its holder to five votes per share. Following the transactions described below, we will conduct all of our business activities through our direct subsidiary, Dynasty Financial Partners, an intermediate holding company, and its subsidiaries. Net profits and net losses of Dynasty Financial Partners will be allocated, and distributions of profits will be made, approximately % to us and % to Dynasty Financial Management, LLC (or % and %, respectively, if the underwriters exercise their option to purchase additional shares in full), immediately after giving effect to the transactions described herein. See Our Structure and Reorganization. Reorganization Transactions We were incorporated in Delaware on August 16, 2021. We will enter into a series of transactions to reorganize our capital structure in connection with this offering. We refer throughout this prospectus to the transactions described below as the reorganization transactions or the reorganization. The reorganization transactions are designed to create a capital structure that preserves our ability to conduct TABLE OF CONTENTS our business through Dynasty Financial Partners (a limited liability company), while permitting us to raise additional capital and provide access to liquidity through a public company. Multiple classes of securities at the public company level are necessary to achieve these objectives and maintain a governance structure that resembles the current governance structure of Dynasty Financial Partners. Common and Profits interests units. The issued and outstanding membership interests in Dynasty Financial Partners currently consist of Class A, Class B and Class C capital interests and Class P and Q profits interests. Each Class B capital interest entitles its holder to five votes, whereas each Class A and C capital interest entitles its holder to one vote. Revisions to Our Organization and Capitalization Structure. Immediately prior to the consummation of this offering, Dynasty Merger Sub, LLC, an indirect wholly-owned subsidiary of Dynasty Financial Partners and direct wholly-owned subsidiary of Dynasty Financial Management, LLC, that we will form for the purpose of the merger, will merge with and into Dynasty Financial Partners, resulting in Dynasty and Dynasty Financial Management, LLC becoming the sole members of Dynasty Financial Partners immediately after the merger. As a result of the merger, each unit of Class A or Class C capital interest in Dynasty Financial Partners will be converted into the right to receive (x) one common equity unit in Dynasty Financial Management, LLC and (y) one share of Class C common stock of Dynasty; each unit of Class B capital interest in Dynasty Financial Partners will be converted into the right to receive (x) one common equity unit in Dynasty Financial Management, LLC and (y) one share of Class B common stock of Dynasty; each unit of Class P profits interest in Dynasty Financial Partners will be converted into the right to receive (x) the appropriate conversion number of common equity units in Dynasty Financial Management, LLC based on the profits interests conversion formula below and (y) an equal number of shares of Class C common stock of Dynasty; each unit of Class Q profits interest in Dynasty Financial Partners issued prior to January 1, 2021 held by a holder that does not hold any other Class A, B or C capital interest or Class P profits interest or Class Q profits interest issued after January 1, 2021(the Qualified Pre-2021 Class Q Interests ) will be entitled to receive (x) the appropriate conversion number of shares of Class A common stock of Dynasty based on the profits interests conversion formula below and (y) an amount in cash from Dynasty Financial Partners equal to 15% of the gross IPO price (as defined below) over the threshold price of such Qualified Pre-2021 Class Q Interests. Any shares of Class A common stock and any corresponding cash amount issued in exchange for an unvested Qualified Pre-2021 Class Q Interest shall be subject to the same vesting schedule as the unvested Qualified Pre-2021 Class Q Interests from which they were converted; and each unit of Class Q profits interest in Dynasty Financial Partners that is not a Qualified Pre-2021 Class Q Interest (the Other Class Q Interests ) will be entitled to receive (x) the appropriate conversion number of common equity units in Dynasty Financial Management, LLC based on the profits interests conversion formula below; provided any common equity units in Dynasty Financial Management, LLC issued in exchange for an unvested Other Class Q Interest shall be subject to the same vesting schedule as the unvested Other Class Q Interests from which they were converted and (y) an equal number of shares of Class C common stock of Dynasty. With respect to profits interests above, the appropriate conversion number is equal to the quotient of (1) the excess, if any, of (A) the public offering price per share of the Class A common stock of Dynasty in the IPO before any discounts or underwriting commissions (the gross IPO price ) over (B) the threshold price of such unit of profits interest, divided by (2) the gross IPO price. In addition, immediately prior to the consummation of this offering, the limited liability company agreement of Dynasty Financial Partners will be amended and restated to effect such reclassification and to appoint Dynasty as the sole managing member of Dynasty Financial Partners. As sole managing member, we will control Dynasty Financial Partners management. As a result, the financial results of TABLE OF CONTENTS Dynasty Financial Partners will be consolidated in our financial statements. Upon the consummation of this offering, Dynasty will use a portion of the net proceeds of this offering to purchase common units of Dynasty Financial Partners from existing Dynasty Financial Partners unitholders (after such unitholders exercise their right to receive common units of Dynasty Financial partners from Dynasty Financial Management, LLC in exchange for such common equity units), and will use a portion of the net proceeds from this offering to purchase a number of newly issued common units from Dynasty Financial Partners. Dynasty Financial Partners will apply the net proceeds it receives as described under Use of Proceeds. We describe the terms of the amended and restated limited liability company agreement of Dynasty Financial Partners under Our Structure and Reorganization Offering Transactions Third Amended and Restated Limited Liability Company Agreement of Dynasty Financial Partners. Following the date that is 180 days after the closing of this offering, holders of common equity units in Dynasty Financial Management, LLC will have the right to receive from Dynasty Financial Management, LLC common units of Dynasty Financial Partners, which will be exchangeable for shares of our Class A common stock, subject to certain restrictions, as described under Our Structure and Reorganization Offering Transactions Exchange Agreement. We will not have any profits interests units after the consummation of this offering. Capital Stock. Immediately prior to the consummation of this offering, we also will amend and restate our certificate of incorporation to authorize three classes of common stock, Class A common stock, Class B common stock and Class C common stock. Our common stock will have the terms described below and, in more detail, under Description of Capital Stock : Class A Common Stock. We will issue shares of our Class A common stock to the public in this offering, and we intend to grant incentive stock options, nonqualified stock options and restricted stock units at the time of this offering to approximately of our employees. An aggregate of shares of Class A common stock underlie these awards. In addition, as part of the merger that is consummated immediately prior to the consummation of this offering, we will issue Class A common stock in exchange for certain Class Q profits interests units held by members of Dynasty Financial Partners. Each share of Class A common stock will entitle its holder to one vote and economic rights in Dynasty (including rights to dividends or distributions upon liquidation). Class B Common Stock. As part of the merger that is consummated immediately prior to the consummation of this offering, we will issue shares of our Class B common stock to certain holders of common units of Dynasty Financial Partners, which generally consist of our founders, in amounts equal to the number of common units that such holders hold at such time. Each share of our Class B common stock will entitle its holder to five votes per share but will have no economic rights in Dynasty (including no rights to dividends or distributions upon liquidation). Class C Common Stock. As part of the merger that is consummated immediately prior to the consummation of this offering, we will issue shares of our Class C common stock to certain holders of common units and profits interests units of Dynasty Financial Partners, which generally consist of initial outside investors, in amounts equal to the number of common units and the appropriate conversion number of profits interests that such holders hold at such time. Each share of Class C common stock will entitle its holder to one vote per share but will have no economic rights (including no rights to dividends or distributions upon liquidation). Exchange Agreement. Immediately prior to the consummation of this offering, we will enter into an exchange agreement which will provide certain exchange rights to holders of common units of Dynasty Financial Partners. Following the date that is 180 days after the closing of this offering, subject to certain restrictions, each holder of Dynasty Financial Management, LLC will have the right to receive from Dynasty Financial Management, LLC common units of Dynasty Financial Partners, which such holders and certain permitted transferees will have the right to then exchange (together with an equal number of shares of our Class B or Class C common stock, as applicable) for shares of our Class A common stock on a one-for-one basis. As the holders of common equity units of Dynasty Financial Management, LLC exchange common units of Dynasty Financial Partners for shares of our TABLE OF CONTENTS Class A common stock, we will receive a number of common units of Dynasty Financial Partners equal to the number of shares of our Class A common stock that they receive, the holders common equity units of Dynasty Financial Management, LLC will be cancelled, and an equal number of shares of our Class B or Class C common stock, as applicable, will also be cancelled. See Our Structure and Reorganization Offering Transactions Exchange Agreement for more detailed information concerning the exchange rights, including a diagram that illustrates the exchange of common units of Dynasty Financial Partners for shares of our capital stock. Subject to certain restrictions, holders of substantially all of the common equity units of Dynasty Financial Management, LLC, including all of our executive officers, will have the right pursuant to the operating agreement of Dynasty Financial Management, LLC to receive from Dynasty Financial Management, LLC common units of Dynasty Financial Partners, which will be exchangeable for shares of our Class A common stock (or restricted shares of our Class A common stock, in the case of exchange of unvested units) following the date that is 180 days after the closing of this offering. Registration Rights Agreement. In connection with this offering, we will enter into a registration rights agreement, pursuant to which holders of the shares of our Class A common stock issued upon exchange of their common units of Dynasty Financial Partners will have certain registration rights. See Our Structure and Reorganization Offering Transactions Registration Rights Agreement for a description of the registration rights agreement. Tax Receivable Agreement. Upon the closing of this offering, we will enter into a tax receivable agreement (the Tax Receivable Agreement ), pursuant to which we generally will be required to pay to certain existing owners of Dynasty Financial Partners 85% of the applicable cash savings, if any, in U.S. federal and state income tax that we actually realize (or are deemed to realize in certain circumstances) in periods after this offering as a result of (i) any step-up in tax basis in Dynasty Financial Partners assets resulting from (a) our purchase of common units of Dynasty Financial Partners for cash or the exchange of common units of Dynasty Financial Partners (along with the corresponding shares of our Class B or Class C common stock) for shares of our Class A common stock and (b) payments under the Tax Receivable Agreement, (ii) certain prior distributions by Dynasty Financial Partners and prior transfers or exchanges of limited liability company interests which resulted in tax basis adjustments to the assets of Dynasty Financial Partners and (iii) tax benefits related to imputed interest deemed to be paid by us as a result of the Tax Receivable Agreement. Under the Tax Receivable Agreement, we generally will retain the benefit of the remaining 15% of the applicable tax savings. See Our Structure and Reorganization Tax Receivable Agreement. Emerging Growth Company Status We are an emerging growth company within the meaning of the federal securities laws. For as long as we are an emerging growth company, we will not be required to comply with certain requirements that are applicable to other public companies that are not emerging growth companies, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ) and will have the benefit of the reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and the exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. We intend to take advantage of these exemptions until we are no longer an emerging growth company. In addition, Section 107 of the Jumpstart Our Business Startups Act (the JOBS Act ) also provides that an emerging growth company can use the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the Securities Act ) for complying with new or revised accounting standards. This permits an emerging growth company to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to use this extended transition period until we are no longer an emerging growth company or until we affirmatively and irrevocably opt out of the extended transition period. Accordingly, this election allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and private companies. When a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, will adopt the new or revised standard at the time private companies adopt the new or revised standard, unless early adoption is TABLE OF CONTENTS permitted by the standard. As a result, our financial statements may not be comparable to the financial statements of companies that comply with new or revised accounting pronouncements as of public company effective dates. For a description of the qualifications and other requirements applicable to emerging growth companies, please read Risk Factors Risks Related to the Offering and Our Class A Common Stock For as long as we are an emerging growth company, we will not be required to comply with certain reporting requirements, including those relating to accounting standards and disclosure about our executive compensation, that apply to other public companies. Our Corporate Information Our principal offices are located at 200 Central Avenue, 15th Floor, St. Petersburg, Florida 33701, and our telephone number is (212) 373-1000. Our internet site is www.dynastyfinancialpartners.com. Our website and the information contained therein or accessible through it are not incorporated into this prospectus or the registration statement of which it forms a part. The company was incorporated in Delaware on August 16, 2021. Dynasty, the Dynasty design logo and other Dynasty tradenames and service marks in use generally and included in this prospectus are the property of Dynasty Financial Partners, Inc. and certain of our subsidiaries. Trade names, trademarks and service markets of other companies appearing in this prospectus are the property of the respective holders. TABLE OF CONTENTS
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated certificate of incorporation are to our certificate of incorporation to be in effect as of the date of this prospectus; common stock are to our Class A common stock and our Class B common stock; DGCL refers to the Delaware General Corporation Law as the same may be amended from time to time; directors are to our current directors and director nominees; founder shares are to shares of Class B common stock initially purchased by our sponsor and JTCM Ventures, an affiliate of one of the underwriters in this offering, in a private placement prior to this offering and the shares of Class A common stock that will be issued upon the automatic conversion of the shares of Class B common stock at the time of our initial business combination as described herein; initial stockholders are to holders of our founder shares prior to this offering; management or our management team are to our executive officers and directors; private placement warrants are to the warrants issued to our sponsor and JTCM Ventures in a private placement simultaneously with the closing of this offering; public shares are to shares of Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholders and member of our management team s status as a public stockholder will only exist with respect to such public shares; sponsor are to Seven Oaks Sponsor II LLC, a Delaware limited liability company; and we, us, company or our company are to Seven Oaks Acquisition Corp. II, a Delaware corporation. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option and the forfeiture of 937,500 founder shares by our initial stockholders for no consideration. Our Company We are a newly organized blank check company incorporated in Delaware and formed for the purpose of effecting an initial business combination with one or more target businesses. To date, our efforts have been limited to organizational activities and activities relating to this offering. We have not identified any specific target business and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any target business regarding an initial business combination with our company. We have generated no revenues to date, and we do not expect that we will generate operating revenues until we consummate our initial business combination at the earliest. Although we may pursue an acquisition opportunity in any business or industry, we intend to focus on opportunities aiming to make a positive social impact with a specific emphasis on good Environmental, Social and Governance ( ESG ) practices. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION DATED FEBRUARY 4, 2022 PRELIMINARY PROSPECTUS $250,000,000 25,000,000 Units Seven Oaks Acquisition Corp. II is a blank check company whose business purpose is to effect a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one share of Class A common stock and one-half of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one share of Class A common stock at a price of $11.50 per share, subject to adjustment as described herein. Only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. The warrants will become exercisable on the later of 30 days after the completion of our initial business combination or 12 months from the closing of this offering, and will expire five years after the completion of our initial business combination or earlier upon redemption or our liquidation, as described herein. The underwriters have a 45-day option from the date of this prospectus to purchase up to 3,750,000 additional units to cover over- allotments, if any. We will provide our public stockholders with the opportunity to redeem all or a portion of their shares of Class A common stock upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding shares of Class A common stock that were sold as part of the units in this offering, which we refer to collectively as our public shares, subject to the limitations and on the conditions described herein. If we are unable to complete our initial business combination within 18 months from the closing of this offering, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account (or up to 24 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus), including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions as further described herein. Our sponsor, Seven Oaks Sponsor II LLC, has committed to purchase an aggregate of 9,000,000 private placement warrants (or 9,750,000 private placement warrants if the underwriters over-allotment option is exercised in full), each exercisable to purchase one share of Class A common stock at $11.50 per share, at a price of $1.00 per warrant, or $9,000,000 in the aggregate (or $9,750,000 if the underwriters over-allotment option is exercised in full), in a private placement that will close simultaneously with the closing of this offering. Additionally, JTCM Ventures LLC ( JTCM Ventures ) has agreed to accept 2,500,000 private placement warrants (or 2,875,000 private placement warrants if the underwriters over-allotment option is exercised in full), each exercisable to purchase one share of Class A common stock at $11.50 per share, in lieu of JonesTrading Institutional Services LLC ( JonesTrading ) receiving $2,500,000 in underwriting discounts and commissions (or $2,875,000 if the underwriters over-allotment option is exercised in full). We refer to our sponsor and JTCM Ventures, an affiliate of one of the underwriters in this offering, as our initial stockholders throughout this prospectus. Our initial stockholders currently own an aggregate of 7,187,500 shares of Class B common stock (up to 937,500 shares of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised), which will automatically convert into shares of Class A common stock concurrently with or immediately following the consummation of our initial business combination on a one- for-one basis, subject to the adjustments described herein. Currently, there is no public market for our units, Class A common stock or warrants. We intend to apply to have our units listed on The Nasdaq Global Market, or Nasdaq, under the symbol SVOBU on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on Nasdaq. We expect the shares of Class A common stock and warrants comprising the units to begin separate trading on Nasdaq under the symbols SVOB and SVOBW, respectively, on the 52nd day following the date of this prospectus unless JonesTrading, the representative of the underwriters in this offering, informs us of its decision to allow earlier separate trading and we have satisfied certain conditions. We are an emerging growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 39 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 250,000,000 Cash underwriting discounts and commissions(1) $ 0.10 $ 2,500,000 Proceeds, before expenses, to us $ 9.90 $ 247,500,000 (1) The underwriters will receive compensation in addition to the underwriting discount. See Underwriting (Conflicts of Interest) . Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $252.5 million, or $290.4 million if the underwriters over-allotment option is exercised in full ($10.10 per unit in either case), will be deposited into a trust account in the United States with Continental Stock Transfer & Trust Company acting as trustee, after deducting $2,500,000 in underwriting discounts and commissions payable upon the closing of this offering (or $2,875,000 if the underwriters over-allotment option is exercised in full) and an aggregate of $4,000,000 to pay fees and expenses in connection with the closing of this offering and for working capital following the closing of this offering. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2022. Sole Bookrunning Manager JonesTrading , 2022 Table of Contents In recent years, we have seen an increased focus among consumers, investors and employees on the alignment businesses should demonstrate between stockholders and broader social good. We believe companies with an explicit focus on making a positive social impact will be best positioned to succeed and grow as an increasing number of people emphasize working for, buying from and investing in organizations that share this goal. Incorporating these principles into an effective business strategy requires ongoing consideration of ESG criteria to develop a sustainable business model that can reliably create social, environmental and economic value. Despite the challenges in achieving this, we believe there are significant, attractive opportunities to invest in businesses committed to this goal. Companies with a cultural emphasis on ESG themes exist across a broad range of industries, but with the common goal of contributing to the solution of complex societal challenges including, among others, climate change, industrial innovation, human capital development, workers rights, access to education, quality health services and diversity. Our team is focused on evaluating targets with a distinct positive social impact, whose business practices demonstrate clear alignment with ESG principles and whose organizational culture embraces the value of such alignment. Following this offering, our initial stockholders intend to transfer, by gift, $1,000,000 in the form of founder shares and/or warrants to a charitable organization to be formed by our sponsor that shares our social impact mission and ESG principles. Further to our purpose and mission, we have signed the United Nations Principles for Responsible Investment. We believe there are attractive investment opportunities that may benefit, both operationally and economically, from our management team s commitment to designing and incorporating ESG processes. Given our management team s operational expertise, we may choose to evaluate targets operating in the industries and sectors where our team has prior experience, which include, but are not limited to, consumer goods and services, business services, technology, manufacturing and healthcare services. Furthermore, our target universe could also include companies undergoing a transition to increase social impact profiles, reflecting an opportunity to bring better ESG practices to businesses that have not historically included such a focus. We intend to target companies that have strong growth rates and that we believe would greatly benefit from both public market expertise and access to public market capital. We believe in the ability of our management team to add significant value to a target company from a commercial, operating, strategic and sustainability perspective. In particular, we will seek to identify and acquire a business that could benefit from stockholders with extensive operational experience and the public company expertise that our management team possesses. Our Management Team Gary S. Matthews is our Chief Executive Officer and Chairman of the board of directors of the Company. Mr. Matthews previously served as the Chief Executive Officer and Chairman of Seven Oaks Acquisition Corp. ( Seven Oaks I ) from September 23, 2020 until Seven Oaks I s business combination with Boxed on December 8, 2021, pursuant to which Boxed, LLC became a wholly owned subsidiary of Seven Oaks I and Seven Oaks I changed its name to Boxed, Inc. Mr. Matthews has served as Chairman of the board of Boxed, Inc. since December 8, 2021. Mr. Matthews has over 30 years of experience as both an institutional investor and a senior executive of multiple businesses across a broad range of industries. Since December 2020, Mr. Matthews has served as a Managing Partner of Tamarix Equity Partners, a private equity fund, and Tamarix Capital Management, LLC, the manager of Tamarix Equity Partners. From March 2019 to August 2020 Mr. Matthews served as Chief Executive Officer and a Director of IES Holdings (NASDAQ: IESC), over which time both EBITDA and the company s stock price increased significantly. Prior to joining IES, Mr. Matthews served as Managing Director of Morgan Stanley Capital Partners from 2007 to 2019 where he co-led direct investments and helped to oversee the management and strategies for those businesses. Prior to joining Morgan Stanley, he led several private equity-backed manufacturing companies in senior management positions. From 2006 to 2007, he served as President of Simmons Bedding Company overseeing operations in the US and Canada. Mr. Matthews also previously served as Chief Executive Officer of sponsor-owned Sleep Innovations, Inc. and of Derby Cycle Corporation. Previously, Mr. Matthews served as President of Worldwide Consumer Medicines and Specialty Pharmaceuticals at Bristol-Myers Squibb. He also served as President of the Guinness Import Company Table of Contents and Managing Director of Guinness in Great Britain. Prior to joining Guinness, Mr. Matthews served as a Director at PepsiCo and as a Senior Engagement Manager at McKinsey & Company. He has previously served as Chairman of the board of directors of Pathway Partners Veterinary Holding LLC, Hojeij Branded Foods, Creative Circle, LLC and Tops Markets, LLC, and as a member of the board of directors of Manna Pro Products, LLC, Molson Coors Brewing Company (NYSE: TAP), Lenox Group Inc. (previously Department 56, NYSE: DFS), Learning Care Group, Inc., Van Wagner, Inc., Lagunitas Brewing Company, and Canyon Ranch. Mr. Matthews received a B.A., Cum Laude, from Princeton University and a Masters in Business Administration with distinction from Harvard Business School. Mr. Matthews has been involved in several philanthropic social organizations. He is on the Board of Let s Get Ready and served as its Chairman for four years. Let s Get Ready works with underprivileged high school seniors to tutor them for the SATs, provides college application assistance, and mentors at the college level to encourage these students to stay in and graduate college. Previously, Mr. Matthews served for 10 years on the Board of the Greenwich Library and was on the Board and served as Board Chair for Junior Achievement of SW Connecticut. Andrew C. Pearson, our Chief Financial Officer, has 25 years experience in global private equity. In 2019, Mr. Pearson formed Soundview Advisors, where he consults with leading private equity firms in the areas of portfolio management, organizational design and LP management. Mr. Pearson previously served as the Chief Financial Officer and as a board member of Seven Oaks I from September 23, 2020 until Seven Oaks I s business combination with Boxed in December 2021 and now serves as a board member of Boxed, Inc. Previously, Mr. Pearson served as Managing Director, Chairman of the Portfolio Committee and Global Head of Portfolio Management with General Atlantic, one of the world s largest global growth equity firms with over $40.0 billion under management and 14 offices on four continents. His responsibilities at General Atlantic increased over a 22-year career which began as an Associate in 1996 before becoming a Managing Director in 2007 and Chairman of the Portfolio Committee in 2012. Mr. Pearson s deal experience covered investments in the software and technology-enabled services markets. As Chairman of the Portfolio Committee, Mr. Pearson was charged with establishing and executing the firm s global liquidity and value-creation targets as well as developing risk management parameters. Prior to joining General Atlantic, Mr. Pearson was a Business Analyst at McKinsey & Company, Inc. Mr. Pearson has been involved in several philanthropic social organizations. Mr. Pearson serves as Treasurer and Board Member of the Blossom Hill Foundation, a non-profit which provides fellowships to social entrepreneurs who develop ideas to help children affected by conflict. He received an M.A. and B.A. in Regional Science from The School of Arts and Sciences at the University of Pennsylvania and a B.S. in Finance, Magna Cum Laude, from The Wharton School at the University of Pennsylvania. David S. Harris, our Chief Operating Officer, has over 30 years of experience in corporate finance as an investment banker, investor and board member and has been in involved in a wide variety of acquisitions and divestitures. Mr. Harris previously served as the Chief Operating Officer and as a board member of Seven Oaks I from September 23, 2021 until Seven Oaks I s business combination with Boxed in December 2021. Mr. Harris has served as President of Grant Capital, Inc. since 2002, where he has led its investment efforts, sourcing, acquiring and managing minority and majority ownership positions in private companies in the consumer, industrial and business services industries. He began his career at Price Waterhouse as a CPA and started his Wall Street career at Furman Selz LLC in 1986. ING Barings acquired Furman Selz in 1997 and ABN Amro, a Dutch financial institution, acquired certain divisions of the firm in 2001. At ING and ABN Amro, Mr. Harris served as a Managing Director and Sector Head of the Retail, Consumer and Leisure investment banking group. Mr. Harris currently serves as Lead Director and Chairman of the Audit and Compensation Committees of REX American Resources Corporation (NYSE: REX) and as Director and Chairman of the Compensation Committee at Carrols Restaurant Group (NASDAQ: TAST), where he also serves on the Audit Committee. He previously served as a member of the board of directors of Spectrum Brands Holdings (NYSE: SPB) and Steiner Leisure Limited where he served on the Audit Committee and was Chairman of both the Compensation Committee and the Special Committee of independent board members formed to consummate the sale of Steiner Leisure Limited to L Catterton. Mr. Harris received a B.S. in Accounting and Finance, Magna Cum Laude, from Rider University and a Masters in Business Administration from Columbia University. Table of Contents Mr. Harris has been involved with Bridges to Community, which develops poverty alleviation strategies within local communities in Nicaragua and the Dominican Republic and leads service-learning trips building homes and schools in those communities, since 2002 and served as Treasurer until 2008. Mr. Harris has also served on the board of the Bronxville School Foundation, is member of the Board of Assessment Review for the Village of Bronxville, and has been a longstanding Elder at the Reformed Church of Bronxville and has led its stewardship program for many years. Randolph K. Tucker, our Chief ESG Officer, has a broad range of experience as a community and labor leader and financial services professional across a variety of industries. Mr. Tucker previously served as the Chief ESG Officer and as a board member of Seven Oaks I from September 23, 2021 until Seven Oaks I s business combination with Boxed in December 2021. Since 2017, he has served as Vice President of Employee Benefits at USI Insurance Services, developing clients while advising CEOs and senior HR leaders on capital-efficient benefit planning and business development strategies. Mr. Tucker served as First Vice President of the NAACP New York Branch under civil rights icon Dr. Annie B. Martin from 2004 to 2012 and served as President from 2012 to 2014. Mr. Tucker subsequently served as Director of Development at Save America s Parks, where he helped raise capital to address budgetary challenges and arranged skilled union volunteers to assist with a backlog of repairs and maintenance projects facing America s parks. From 2015 to 2017, Mr. Tucker worked as a Consultant at Arthur J. Gallagher & Co. and has also previously served as a Vice President at Wells Fargo and as an Advisor for the Kelson Group. Mr. Tucker began his career with the United Food and Commercial Workers Union Local 888 as a business representative in 1995. His responsibilities increased over the following 15 years, rising to the role of Secretary Treasurer in 2004 and serving as Chairman of Health and Pension Funds from 2008 to 2010. Mr. Tucker currently serves as Vice Chairman of the Tri-State Law Enforcement Foundation, a non-profit organization which works closely with top law enforcement officials in New York, New Jersey and Connecticut to support local law enforcement, encourage cooperation between law enforcement agencies and their communities, and provide scholarships and assistance to the spouses and children of fallen officers. In September 2020, Mr. Matthews and Mr. Hauser founded Seven Oaks Acquisition Corp. (Nasdaq: SVOK), a special purpose acquisition company formed for substantially similar purposes as our company. Seven Oaks I completed an upsized $258.8 million initial public offering on December 22, 2020. On June 13, 2021, Seven Oaks I entered into a definitive agreement to merge with Giddy, Inc. (d/b/a Boxed), an e-commerce grocery shopping platform selling bulk consumables to households and businesses. The management team expects Boxed to reach 30%+ CAGR in revenue over the next three years and believes the company will yield significant stockholder value based on the strength of the market, strong management team, and infusion of capital to further grow its customer base. On December 8, 2021, Seven Oaks I consummated the business combination with Boxed. We believe that our management team has the expertise, credibility and potential deal pipeline to act as a premier capital provider from public market investors. Our management team has a network of relationships that we believe would be beneficial for a potential target company to enhance monetization, exposure and growth, as well as a hiring network that can be utilized to support a potential target company. Past performance of our management team, including with respect to Seven Oaks I, does not guarantee either (i) success with respect to any business combination we may consummate or (ii) that we will be able to identify a suitable candidate for our initial business combination. You should not rely on the historical performance record of our management team, including with respect to Seven Oaks I, as indicative of our future performance. Other than Seven Oaks I, none of the members of our management team has any experience with blank check companies or special purpose acquisition companies. Table of Contents Our Board Our management team s skills are complemented by our directors, who bring significant operating experience and relationships throughout multiple industries and sectors. Gary Matthews will serve as chairman of our board and, in addition to Mark Hauser, our current director, Regynald Washington, Heidi Manna and Jaap Tonckens are our director nominees. Mr. Hauser has over 30 years experience in private equity, private credit, venture capital and investment banking. Mr. Hauser previously served on the board of Seven Oaks I from December 2020 until Seven Oaks I s business combination with Boxed in December 2021. Mr. Hauser is the Founder and Managing Director of Tamarix Capital Corp., an investment firm providing flexible financing solutions to middle-market companies since 1993. In January 2020, Mr. Hauser founded and has since served as a Managing Partner of Tamarix Equity Partners, a private equity fund, and Tamarix Capital Management, LLC, the manager of Tamarix Equity Partners. From 2013 to 2019, he served as a Senior Managing Director and a member of the Investment Committee at OFS Capital Management, LLC, where he founded the firm s SBIC fund and was responsible for middle-market lending. Mr. Hauser previously served as a Senior Managing Director at Sandell Asset Management, an international multi-strategy alternative asset manager where he founded the firm s private equity practice, and as a Managing Director at FdG Associates, a New York-based middle-market private equity fund focused on investing in family owned businesses. Mr. Hauser began his career in 1979 as a corporate attorney practicing in Sydney with Simons & Bafsky, before subsequently practicing in London with Simmons & Simmons and in New York with Rogers & Wells. From 1985 to 1991, Mr. Hauser served as a Principal at Ocean Capital Corporation, a private international investment banking firm. Mr. Hauser holds a Master of Laws from the London School of Economics and Political Science and a Bachelor of Economics and Bachelor of Law from Sydney University. Regynald Washington will serve on our board of directors following the completion of this offering. Mr. Washington previously served on the board of Seven Oaks I from December 2020 until Seven Oaks I s business combination with Boxed in December 2021. Mr. Washington has over 25 years of experience in the restaurant and hospitality industries, where he has received multiple awards for his excellent work, including the 2019 International Foodservice Manufacturers Association s Gold Plate Award and the 2019 Georgia Restaurant Association s Lifetime Achievement Award. Mr. Washington currently serves as President & CEO of RGW Enterprises, Inc. Mr. Washington previously served as President of the Paradies Lagard re Dining Division and previous to that served as Chief Executive Officer of Hojeij Branded Foods, Inc. from 2010 until its 2018 acquisition by Paradies Lagard re. From 1997 to 2009, he served in a variety of roles at The Walt Disney Company, including as Vice President of Worldwide Food and Beverage Operations for Walt Disney Parks and Resorts, Vice President and General Manager of Disney Regional Entertainment, and Director of Resort Food and Beverage Operations where Mr. Washington oversaw all food and beverage operations for 18 Walt Disney Resorts. Since 2019, Mr. Washington has served as a Trustee of the Culinary Institute of America and has previously served as Chairman of the National Restaurant Association. He is also currently a member of the Board of Trustees of Georgia State University, the Board of Directors of the Chicago Sinfonietta, and serves as the Dean s Advisory Board Member of the Chaplin School of Hospitality Management at Florida International University. He received a B.S. in International Hotel and Restaurant Management, Cum Laude, from Florida International University. Heidi Manna will serve on our board of directors following the completion of this offering. Ms. Manna previously served on the board of Seven Oaks I from February 2021 until Seven Oaks I s business combination with Boxed in December 2021. Ms. Manna is an experienced business executive and human capital strategist who has served in various hum an capital leadership roles over her 25 year career. She has experience across multiple industries including pharmaceuticals, consumer products, food and beverage, and management consulting at both established and emerging companies with operations and footprints in dynamic markets worldwide. Ms. Manna has served as Senior Vice President and Chief Human Resource Officer for Jazz Pharmaceuticals, a global biopharmaceutical company, since 2018. Prior to this, she was Vice-President of Human Resources for Campbell Soup Company from 2010 to 2018. Before that, Ms. Manna served in various Table of Contents human resource leadership roles over a 14-year tenure at Bristol-Myers Squibb and began her career at Andersen Consulting. Ms. Manna currently serves on the Employer Advisory Board for the University of Pennsylvania. She holds a Bachelor s degree from Binghamton University and a Masters of Business Administration from the State University of New York at Buffalo. Jaap Tonckens will serve on our board of directors following the completion of this offering. Since December 2021, Mr. Tonckens has served as Chief Administrative Officer of BPV Management Co. LLC, a management services company which provides development management, tenant and non-tenant related services in connection with the development of Belmont Park in Queens, New York. Mr. Tonckens currently serves as a director of citizenM hotels, a fully integrated owner-operator hotel brand with hotels in major cities in Europe and North America, and as a strategic advisor to the board of directors of VIA Outlets, an owner and operator of outlet centers in Europe. Mr. Tonckens also serves as a senior advisor to Value Retail, the operator and developer of 11 luxury shopping destinations serving the capital cities of Western Europe and China. Value Retail is developing Belmont Park Village, its first luxury outlet village in North America, as part of the further development of the Belmont Park. Mr. Tonckens has over 30 years experience in real estate, investment banking and law. From June 2018 until his retirement in January 2021, Mr. Tonckens served as Group Chief Financial Officer and Chief Investment Officer of Unibail-Rodamco-Westfield S.E., a premier global developer and operator of flagship destinations in the most dynamic cities in Europe and the United States, with a portfolio valued at 55.0 billion as at June 30, 2021 and listed on Euronext Amsterdam and Euronext Paris (Euronext ticker: URW) with a secondary listing on the Australian Stock Exchange (ASX: URW). From 2012 to 2018, Mr. Tonckens served as Chief Financial Officer and Chief Investment Officer of Unibail-Rodamco S.E., after joining the firm as General Counsel in 2009. Mr. Tonckens enjoyed a 14-year career at Morgan Stanley from 1994 to 2008, where he held several positions including Managing Director of its Leveraged Finance team in New York with a focus on consumer, retail, and general industrial companies. Mr. Tonckens began his career in 1988 as a corporate attorney practicing with Shearman & Sterling in New York and Paris until 1994. Mr. Tonckens holds a Master of Laws from Emory University School of Law and a law degree from Leyden University in the Netherlands. Mr. Tonckens currently is a Trustee of the International Counsel of Shopping Centers and previously served as a Global Trustee of the Urban Land Institute from 2016 until 2019. Business Strategy Our acquisition strategy is to identify and conduct a business combination with a company we can help grow within a public market environment. We intend to deploy a proactive, thematic acquisition sourcing strategy and to focus on companies with strong ESG practices, or the ability to materially improve such practices, where the combination of our management team s operating experience, relationships, capital and capital markets expertise can be catalysts to transform and accelerate the target business s growth and performance. Our selection process will leverage our management team s broad network of private equity and banking contacts and corporate relationships, deal-sourcing capability and industry experiences to access a wide range of opportunities. Upon completion of this offering, members of our management team will communicate with their network of relationships to articulate our acquisition themes, including the parameters of our search for a target company, and will begin the disciplined process of pursuing and reviewing promising leads. The members of our management team have experience in: Sourcing, structuring, acquiring, and selling businesses; Executing transactions in multiple geographies and under varying economic and financial market conditions; Operating public and private companies, setting and changing strategies, and identifying, mentoring and recruiting world-class talent; Table of Contents Developing and growing public and private companies, both organically and through acquisitions and strategic transactions and expanding the product range and geographic footprint of a number of target businesses; Accessing the capital markets, including financing businesses and helping companies transition to public ownership; Engaging with public market analysts and investors to help companies communicate their business model, opportunity and strategy to maximize value for their stockholders; and Fostering relationships with sellers, capital providers and target management teams. These experiences have provided our team with a broad understanding of public market performance and investor expectations, enhancing their ability to provide guidance as a target management team transitions from private to public markets. Our Acquisition Process In evaluating a prospective target business, we expect to conduct a thorough due diligence review that will encompass, among other things, meetings with incumbent management and employees, document reviews, inspection of facilities, as well as a review of financial, operational, legal and other information which will be made available to us. We will also utilize our operational and capital planning experience. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our initial stockholders, sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our initial stockholders, sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion that our initial business combination is fair to our company from a financial point of view from an independent investment banking firm that is a member of the Financial Industry Regulatory Authority, Inc. ( FINRA ), an independent accounting firm, or another independent entity that commonly renders valuation opinions. Members of our management team will directly or indirectly own founder shares and/or private placement warrants following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors is included by a target business as a condition to any agreement with respect to our initial business combination. Our officers have agreed not to become an officer or director of any other special purpose acquisition company which has publicly filed a registration statement with the SEC until we have entered into a definitive agreement regarding our initial business combination or we have failed to complete our initial business combination within 18 months after the closing of this offering (or up to 24 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus). Acquisition Criteria We have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses for a business combination. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. We intend to acquire one or more businesses or entities that we believe: Has operations and ESG characteristics that align with our investment theme: We will seek to acquire a business with responsible corporate governance which currently has or has the potential to generate a positive social impact or promote environmental sustainability, and which has the potential to grow and create stockholder value. Table of Contents Has a committed and talented management team: We will seek to acquire a business with a skilled management team whose abilities and experience complement those of our management team and whose interests are aligned with our impact mission and effort to create value. Where necessary, our management team is willing to take on roles and responsibilities which support the business and help fill gaps in the operational structure, to the extent such gaps exist. Could benefit from our specific expertise and capabilities: We will seek to acquire a business with operations or characteristics which offer distinct synergies with the capabilities of our management team that can be leveraged to tangibly improve the operations and market position of the target. Has a defensible market position: We will seek to acquire a business that has a defensible position within its target market as a result of a differentiated products, proprietary technology, supply chains or distribution channels, or other competitive advantages. Has the potential to grow organically and through acquisitions: We will seek to acquire a business that has the potential to grow organically, through market or product expansion, increased market share, or through external acquisitions. Will benefit from access to public capital markets: We will seek to acquire a business which is positioned to grow directly as a result of gaining access to public capital. Can be acquired at an attractive valuation: We will seek to acquire a business on terms and at a value which will offer our stockholders strong growth potential and risk-adjusted equity returns. Notwithstanding the foregoing, these criteria and guidelines are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general criteria and guidelines as well as other considerations, factors, criteria and guidelines that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria and guidelines in our stockholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC. Initial Business Combination Nasdaq listing rules require that we must consummate an initial business combination with one or more operating businesses or assets that together have an aggregate fair market value equal to at least 80% of the net assets held in the trust account (excluding advisory fees and taxes payable on the income earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination (including with the assistance of financial advisors), we will obtain an opinion from an independent investment banking firm which is a member of FINRA or an independent valuation or appraisal firm with respect to the satisfaction of such criteria. While we consider it likely that our board of directors will be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of the target s assets or prospects. We anticipate structuring our initial business combination so that the post transaction company in which our public stockholders own shares will own or acquire 100% of the outstanding equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post transaction company owns or acquires less than 100% of such interests or assets of the target business in order to Table of Contents meet certain objectives of the target management team or stockholders or for other reasons, but we will only complete such business combination if the post transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post transaction company owns or acquires 50% or more of the outstanding voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity securities of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the outstanding equity interests or assets of a target business or businesses are owned or acquired by the post transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test described above. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. Prior to the effectiveness of the registration statement of which this prospectus forms a part, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. We will have up to 18 months from the closing of this offering to consummate an initial business combination. However, if we anticipate that we may not be able to consummate our initial business combination within 18 months, we may, by resolution of our board if requested by our sponsor, extend the period of time to consummate a business combination up to two times, each by an additional three months (for a total of up to 24 months to complete a business combination), subject to our sponsor or its affiliates or designees depositing additional funds into the trust account as set out below. Our stockholders will not be entitled to vote or redeem their shares in connection with any such extension. However, our stockholders will be entitled to vote and redeem their shares in connection with a stockholder meeting held to approve an initial business combination or in a tender offer undertaken in connection with an initial business combination if we propose such a business combination during any three-month extension period. Pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order for the time available for us to consummate our initial business combination to be extended, our sponsor, upon five days advance notice prior to the applicable deadline, must deposit into the trust account an aggregate of $2,500,000 or $2,875,000 if the underwriters overallotment option is exercised in full ($0.10 per share in either case), or up to an aggregate of $5,000,000 (or up to $5,750,000 depending on the extent to which the underwriters over-allotment option is exercised), or $0.20 per share, for a six-month extension, on or prior to the date of the applicable deadline, for each three-month extension. Any such payments would be made in the form of a non-interest bearing loan. If, however, we have executed a letter of intent, agreement in principle or definitive agreement for our initial business combination within 18 months from the closing of this offering but have not completed our initial business combination within such 18-month period, we may choose to extend the period of time to consummate a business combination by an additional three months at no cost to the sponsor. If we complete our initial business combination, we will, at the option of our sponsor or its affiliates or designees, repay such loaned amounts out of the proceeds of the trust account released to us or convert a portion or all of the total loan amount into warrants at a price of $1.00 per warrant. Table of Contents Corporate Information We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates exceeds $700 million as of the end of that year s second fiscal quarter; and (2) the date on which we have issued more than $1.00 billion in non- convertible debt during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates exceeds $250 million as of the end of that fiscal year s second fiscal quarter, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as of the end of that fiscal year s second fiscal quarter. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible. Our executive offices are located at 445 Park Avenue, 17th Floor, New York, NY 10022 and our phone number is (917) 214-6371. Upon completion of this offering, our corporate website address will be sevenoaksacquisition.com. Our website and the information contained on, or that can be accessed through, the website is not deemed to be incorporated by reference in, and is not considered part of, this prospectus or the registration statement of which this prospectus forms. You should not rely on any such information in making your decision whether to invest in our securities. Table of Contents THE OFFERING In making your decision on whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors in this prospectus. Securities offered consisting of 25,000,000 units, at $ 10.00 per unit, each unit Proposed Nasdaq symbols one share of Class A common stock; and one-half of one redeemable warrant. Units: SVOBU Class A common stock: SVOB Warrants: SVOBW Trading commencement and separation of shares of Class A common stock and warrants The units are expected to begin trading on or promptly after the date of this prospectus. The shares of Class A common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless JonesTrading informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the shares of Class A common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of Class A common stock and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Additionally, the units will automatically separate into their component parts and will not be traded after completion of our initial business combination. Separate trading of the Class A common stock and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A common stock and warrants be traded separately until we have filed with the SEC a Current Report on Form 8-K which includes an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering. If the underwriters over- allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over- allotment option. Table of Contents Units: Number outstanding before this offering 0 Number outstanding after this offering 25,000,000(1) Common stock: Number outstanding before this offering 7,187,500 (2)(3) Number outstanding after this offering Warrants: 31,250,000(1)(3)(4) Number of private placement warrants to be sold in a private placement simultaneously with this offering 11,500,000(1) Number of warrants to be outstanding after this offering and the private placement 24,000,000(1) (1) Assumes no exercise of the underwriters over-allotment option and the forfeiture of 937,500 founder shares by our initial stockholders for no consideration. (2) Includes up to 937,500 founder shares that will be forfeited by our initial stockholders depending on the extent to which the underwriters over-allotment option is exercised. (3) Founder shares are currently classified as shares of Class B common stock, which shares will automatically convert into shares of Class A common stock concurrently with or immediately following the consummation of our initial business combination on a one-for-one basis, subject to adjustment as described below adjacent to the caption Founder shares conversion and anti-dilution rights. (4) Includes 25,000,000 public shares and 6,250,000 founder shares. Exercisability Each whole warrant offered in this offering is exercisable to purchase one share of Class A common stock. Only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We structured each unit to contain one-half of one warrant, with each whole warrant exercisable for one share of Class A common stock, as compared to units issued by some other similar special purpose acquisition companies which contain whole warrants exercisable for one whole share, in order to reduce the dilutive effect of the warrants upon completion of a business combination as compared to units that each contain a whole warrant to purchase one whole share, thus making us, we believe, a more attractive business combination partner for target businesses. Table of Contents Exercise price $11.50 per share, subject to adjustments as described herein. In addition, if (x) we issue additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our initial stockholders or their affiliates, without taking into account any founder shares held by our initial stockholders or such affiliates, as applicable, prior to such issuance) (the Newly Issued Price ) (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our Class A common stock during the 20 trading day period starting on the trading day after the day on which we consummate our initial business combination (such price, the Market Value ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, the $18.00 per share redemption trigger price described adjacent to Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00 will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. For the avoidance of doubt, if the adjustment in the immediately preceding sentence would otherwise result in an increase in the exercise price of the warrants (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations and the like) hereunder, no adjustment shall be made. Exercise period The warrants will become exercisable on the later of: 30 days after the completion of our initial business combination, and 12 months from the closing of this offering; provided in each case that we have an effective registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise of the warrants and a current prospectus relating to them is available and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). If and when the warrants become redeemable by us, we may exercise our redemption right even Table of Contents if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. We are not registering the shares of Class A common stock issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable, but in no event later than 15 business days after the closing of our initial business combination, we will use our best efforts to file with the SEC and have an effective registration statement covering the shares of Class A common stock issuable upon exercise of the warrants and to maintain a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed, as specified in the warrant agreement. If a registration statement covering the Class A common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when Redemption of warrants when the price per share of Class A common stock equals or we will have failed to maintain an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption. Notwithstanding the above, if our shares of Class A common stock are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, and in the event we do not so elect, we will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption of warrants when the price per share of Class A common stock equals or exceeds $18.00 Once the warrants become exercisable, we may redeem the outstanding warrants for cash: in whole and not in part; at a price of $0.01 per warrant; Table of Contents upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period ; and if, and only if, the last reported sale price (the closing price ) of our Class A common stock equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading Description of Securities Warrants Public Stockholders Warrants Anti-Dilution Adjustments ) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. We will not redeem the warrants as described above unless an effective registration statement under the Securities Act covering the Class A common stock issuable upon exercise of the warrants is effective and a current prospectus relating to those shares of Class A common stock is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. Cashless exercise If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In determining whether to require all holders to exercise their warrants on a cashless basis, our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our stockholders of issuing the maximum number of Class A common stock issuable upon the exercise of our warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of ordinary shares equal to the quotient obtained by dividing (x) the product of the number of Class A common stock underlying the warrants, multiplied by the excess of the fair market value of our ordinary shares (defined below) over the exercise price of the warrants by (y) the fair market value. The fair market value will mean the average reported closing price of the Class A common stock as reported during the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. No fractional shares of Class A common stock will be issued upon redemption. If, upon redemption, a holder would be entitled to receive a fractional interest in a share, we will round down to the nearest Table of Contents whole number of the number of shares of Class A common stock to be issued to the holder. Please see the section entitled Description of Securities Warrants Public Stockholders Warrants for additional information. Pursuant to the warrant agreement, references above to Class A common stock shall include a security other than Class A common stock into which the Class A common stock has been converted or exchanged for in the event we are not the surviving company in our initial business combination. Founder shares On August 16, 2021, our initial stockholders paid an aggregate of $25,000 to purchase 7,187,500 founder shares, or approximately $0.003 per share. Our sponsor and JTCM Ventures purchased 6,109,375 and 1,078,125 of the founder shares, respectively. Prior to the initial investment in the company of $25,000 by the initial stockholders, the company had no assets, tangible or intangible. The per share price of the founder shares was determined by dividing the amount of cash contributed to the company by the number of founder shares issued. The number of founder shares outstanding was determined based on the expectation that the total size of this offering would be a maximum of 28,750,000 units if the underwriters over- allotment option is exercised in full, and therefore that such founder shares would represent 20% of the outstanding shares after this offering. Up to 937,500 of the founder shares will be forfeited depending on the extent to which the underwriters over-allotment option is not exercised. If the over- allotment option is not fully exercised, our sponsor may forfeit up to 796,875 founder shares and JTCM Ventures may forfeit up to 140,625 founder shares. If we increase or decrease the size of the offering pursuant to Rule 462(b) under the Securities Act, we will effect a stock dividend or share contribution back to capital or other appropriate mechanism, as applicable, with respect to our Class B common stock immediately prior to the consummation of the offering in such amount as to maintain the ownership of founder shares by our initial stockholders, on an as-converted basis, at 20.0% of our issued and outstanding common stock upon the consummation of this offering. The founder shares are identical to the shares of Class A common stock included in the units being sold in this offering, except that: only holders of the founder shares have the right to vote on the appointment of directors prior to our initial business combination and holders of a majority of our Table of Contents founder shares may remove a member of the board of directors for any reason; the founder shares are subject to certain transfer restrictions, as described in more detail below; the founder shares are entitled to registration rights; our initial stockholders, sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to (i) waive their redemption rights with respect to any founder shares and public shares they hold in connection with the completion of our initial business combination, (ii) waive their redemption rights with respect to any founder shares and public shares they hold in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation to modify the substance or timing of our obligation to redeem 100% of our public shares if we have not consummated an initial business combination within 18 months from the closing of this offering (or up to 24 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus)or with respect to any other material provisions relating to stockholders rights or pre-initial business combination activity and (iii) waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to complete our initial business combination within 18 months from the closing of this offering (or up to 24 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) or any extended period of time that we may have to consummate an initial business combination as a result of an amendment to our amended and restated certificate of incorporation (an Extension Period ) (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). If we submit our initial business combination to our public stockholders for a vote, our initial stockholders have agreed to vote their founder shares and any public shares purchased during or after this offering in favor of our initial business combination. As a result, in addition to our initial stockholders founder shares, we would need 9,375,001, or 37.5%, of the 25,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming all outstanding shares are voted and the over-allotment option is not exercised); and Table of Contents the founder shares are automatically convertible into our Class A common stock concurrently with or immediately following the consummation of our initial business combination on a one-for- one basis, subject to adjustment pursuant to certain anti-dilution rights, as described below adjacent to the caption Founder shares conversion and anti-dilution rights. The founder shares purchased by JTCM Ventures are deemed underwriters compensation by FINRA pursuant to FINRA Rule 5110 and are subject to the restrictions imposed by that rule. Transfer restrictions on founder shares Our initial stockholders have agreed not to transfer, assign or sell any of their founder shares until the earlier to occur of: (i) one year after the completion of our initial business combination and (ii) the date on which we complete a liquidation, merger, capital stock exchange or other similar transaction after our initial business combination that results in all of our stockholders having the right to exchange their Class A common stock for cash, securities or other property; except to certain permitted transferees and under certain circumstances as described herein under Principal Stockholders Transfers of Founder Shares and Private Placement Warrants . Any permitted transferees will be subject to the same restrictions and other agreements of our initial stockholders with respect to any founder shares. We refer to such transfer restrictions throughout this prospectus as the lock-up. Notwithstanding the foregoing, if (1) the closing price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock capitalizations, reorganizations recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination or (2) if we consummate a transaction after our initial business combination which results in our stockholders having the right to exchange their shares for cash, securities or other property, the founder shares will be released from the lock-up. Following this offering, our initial stockholders intend to transfer, by gift, $1,000,000 in the form of founder shares and/or warrants to a charitable organization to be formed by our sponsor that shares our social impact mission and ESG principles. The founder shares acquired or to be acquired by JTCM Ventures have been deemed compensation by FINRA and are therefore subject to the lock-up restrictions imposed by FINRA Rule 5110(e) pursuant to which these securities will not be sold, transferred, assigned, pledged, or hypothecated, or be the subject of any hedging, short sale, derivative, put or call transaction that would result in the economic disposition of the securities by any person for a period of 180 days immediately following the commencement of sales of this offering except as permitted under FINRA Rule 5110(e)(2) including to any member participating in the offering and the officers or Table of Contents partners, registered persons or affiliates thereof. The holders of the founder shares will be entitled to registration rights pursuant to a registration rights agreement to be signed prior to or on the effective date of this offering, requiring us to register such securities for resale. We will bear the expenses incurred in connection with the filing of any such registration statements. For more information, please see Description of Securities Registration Rights. The registration rights relating to the founder shares and private placement warrants held by JTCM Ventures shall comply with the requirements of FINRA Rule 5110(g)(8)(B)-(D), namely that (i) JTCM Ventures will be entitled to only one demand registration right, (ii) the demand registration right shall not have a duration of more than five years from the commencement of sales of this public offering and (iii) that any piggyback registration right shall not have a duration of more than seven years from commencement of sales of this public offering. FINRA 5121 Conflicts of interest JTCM Ventures, an affiliate of one of the underwriters in this offering, which beneficially owns more than 10% of our outstanding common stock prior to the consummation of this offering. As a result, JTCM Ventures is deemed to have a conflict of interest within the meaning of FINRA Rule 5121. Accordingly, this offering is being made in compliance with the applicable provisions of FINRA Rule 5121. FINRA Rule 5121 prohibits JTCM Ventures from making sales to discretionary accounts without the prior written approval of the account holder and requires that a qualified independent underwriter, as defined in FINRA Rule 5121, participate in the preparation of the registration statement and exercise its usual standards of due diligence with respect thereto. is acting as a qualified independent underwriter for this offering. will receive a fee of from the total underwriting discount in consideration for its services and expenses incurred as a qualified independent underwriter. We have agreed to indemnify against certain liabilities incurred in connection with acting as a qualified independent underwriter, including liabilities under the Securities Act. Please see Underwriting (Conflicts of Interest) for more information. Founder shares conversion and anti-dilution rights The founder shares will automatically convert into shares of Class A common stock concurrently with or immediately following the consummation of our initial business combination on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein. In the case that additional shares of Class A common stock or equity-linked securities are issued or deemed issued in connection with our initial business combination, the number Table of Contents of shares of Class A common stock issuable upon conversion of all founder shares will equal, in the aggregate, on an as- converted basis, 20% of the total number of shares of Class A common stock outstanding after such conversion (after giving effect to any redemptions of shares of Class A common stock by public stockholders), including the total number of shares of Class A common stock issued, or deemed issued or issuable upon conversion or exercise of any equity- linked securities or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of the initial business combination, excluding any shares of Class A common stock or equity-linked securities or rights exercisable for or convertible into shares of Class A common stock issued, or to be issued, to any seller in the initial business combination and any private placement warrants issued to our sponsor, officers or directors upon conversion of working capital loans, provided that such conversion of founder shares will never occur on a less than one-for-one basis. Appointment of directors; voting rights Prior to our initial business combination, only holders of our founder shares will have the right to vote on the appointment of directors. Holders of our public shares will not be entitled to vote on the appointment of directors during such time. In addition, prior to the completion of an initial business combination, holders of a majority of our founder shares may remove a member of the board of directors for any reason. These provisions of our amended and restated certificate of incorporation may only be amended by approval of a majority of the shares of our Class B common stock voting in an annual meeting. With respect to any other matter submitted to a vote of our stockholders, including any vote in connection with our initial business combination, except as required by law, holders of our founder shares and holders of our public shares will vote together as a single class, with each share entitling the holder to one vote. Private placement warrants Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 9,000,000 private placement warrants (or 9,750,000 warrants if the underwriters over-allotment option is exercised in full), each exercisable to purchase one share of Class A common stock at $11.50 per share, at a price of $1.00 per warrant, or $9,000,000 in the aggregate (or $9,750,000 if the underwriters over-allotment option is exercised in full), in a private placement that will close simultaneously with the closing of this offering. Additionally, JTCM Ventures has agreed to accept 2,500,000 private placement warrants (or 2,875,000 private placement warrants if the underwriters over-allotment option is exercised in full), each exercisable to purchase one share of Class A common stock at $11.50 per share, in lieu of JonesTrading receiving $2,500,000 in underwriting discounts and commissions (or $2,875,000 if the underwriters over-allotment Table of Contents option is exercised in full). The private placement warrants have terms and provisions that are identical to the warrants sold in this offering except that the warrants held by JTCM Ventures will not be exercisable more than five years from the effective date of the registration statement of which this prospectus forms a part in accordance with FINRA Rule 5110(g)(8)(A). A portion of the purchase price of the private placement warrants will be added to the proceeds from this offering to be held in the trust account such that at the time of closing of this offering $252.5 million (or $290.4 million if the underwriters exercise their over-allotment option in full) will be held in the trust account. If we do not complete our initial business combination within 18 months from the closing of this offering (or up to 24 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) or during any Extension Period, the private placement warrants will expire worthless. The private placement warrants will be non- redeemable (except as described under Description of Securities Warrants Public Stockholders Warrants Redemption of warrants for Class A common stock ) and exercisable on a cashless basis so long as they are held by their initial purchasers or their permitted transferees (except as described below under Principal Stockholders Transfers of Founder Shares and Private Placement Warrants ). If the private placement warrants are held by holders other than their initial purchasers or their permitted transferees, the private placement warrants will be redeemable by us and exercisable by the holders on the same basis as the warrants included in the units being sold in this offering. Transfer restrictions on private placement warrants The private placement warrants (including the Class A common stock issuable upon exercise of the private placement warrants) will not be transferable, assignable or salable until 30 days after the completion of our initial business combination, except as described herein under Principal Stockholders Transfers of Founder Shares and Private Placement Warrants . The private placement warrants acquired or to be acquired by JTCM Ventures have been deemed compensation by FINRA and are therefore subject to the lock-up restrictions imposed by FINRA Rule 5110(e) pursuant to which these securities will not be sold, transferred, assigned, pledged, or hypothecated, or be the subject of any hedging, short sale, derivative, put or call transaction that would result in the economic disposition of the securities by any person for a period of 180 days immediately following the commencement of sales of this offering except as permitted under FINRA Rule 5110(e)(2) including to any member participating in the offering and the officers or partners, registered persons or affiliates thereof. The holders of the private placement warrants will be entitled to registration Table of Contents rights pursuant to a registration rights agreement to be signed prior to or on the effective date of this offering, requiring us to register such securities for resale. We will bear the expenses incurred in connection with the filing of any such registration statements. For more information, please see Description of Securities Registration Rights. The registration rights relating to the founder shares and private placement warrants held by JTCM Ventures shall comply with the requirements of FINRA Rule 5110(g)(8)(B)-(D), namely that (i) JTCM Ventures will be entitled to only one demand registration right; (ii) the demand registration right shall not have a duration of more than five years from the commencement of sales of this public offering and (iii) that any piggyback registration right shall not have a duration of more than seven years from commencement of sales of this public offering. Proceeds to be held in trust account Nasdaq rules provide that at least 90% of the gross proceeds from this offering and the sale of the private placement warrants be deposited in a trust account. Of the proceeds we will receive from this offering and the sale of the private placement warrants described in this prospectus, $252.5 million, or $290.4 million if the underwriters over-allotment option is exercised in full ($10.10 per unit in either case), will be deposited into a segregated trust account located in the United States at JP Morgan Chase Bank, N.A. with Continental Stock Transfer & Trust Company acting as trustee, after deducting $2,500,000 in underwriting discounts and commissions payable upon the closing of this offering (or $2,875,000 if the underwriters over-allotment option is exercised in full), and an aggregate of $4,000,000 to pay fees and expenses in connection with the closing of this offering and for working capital following the closing of this offering. The funds in the trust account will include the $8,750,000 fee (or $10,062,500 if the underwriters over-allotment option is exercised in full) payable to the underwriters pursuant to the Business Combination Marketing Agreement described under Underwriting (Conflicts of Interest) Business Combination Marketing Agreement, which fee we refer to throughout this prospectus as the Marketing Fee. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, the proceeds from this offering and the sale of the private placement warrants will not be released from the trust account until the earliest of (i) the completion of our initial business combination, (ii) the redemption of our public shares if we are unable to complete our initial business combination within 18 months from the closing of this offering (or up to 24 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus), subject to applicable law, and (iii) the redemption of our public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation to modify the substance or timing of Table of Contents our obligation to redeem 100% of our public shares if we have not consummated an initial business combination within 18 months from the closing of this offering (or up to 24 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) or with respect to any other material provisions relating to stockholders rights or pre-initial business combination activity. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. Ability to extend time to complete business combination: If we anticipate that we may not be able to consummate our initial business combination within 18 months, we may, by resolution of our board if requested by our sponsor or its affiliates or designees, extend the period of time to consummate a business combination up to two times, each by an additional three months (for a total of up to 24 months to complete a business combination). Pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order to extend the time available for us to consummate our initial business combination, our sponsor or its affiliates or designees, upon five days advance notice prior to the date of the applicable deadline, must deposit into the trust account, pro rata in accordance with their percentage ownership of the total number of outstanding founder shares, an aggregate of $2,500,000, or up to $2,875,000 depending on the extent to which the underwriters over-allotment option is exercised ($0.10 per share in any case), on or prior to the date of the applicable deadline, for each three-month extension, or up to an aggregate of $5,000,000 (or up to $5,750,000 depending on the extent to which the underwriters over-allotment option is exercised), or $0.20 per share, for a full six-month extension. Any such payments would be made in the form of a noninterest bearing loan. If, however, we have executed a letter of intent, agreement in principle or definitive agreement for our initial business combination within 18 months from the closing of this offering but have not completed our initial business combination within such 18-month period, our sponsor may choose to extend the period of time to consummate a business combination by an additional three months at no cost to the sponsor. If we complete our initial business combination, we will, at the option of our sponsor or its affiliates or designees, repay such loaned amounts out of the proceeds of the trust account released to us or convert a portion or all of the total loan amount into warrants at a price of $1.00 per warrant. If we do not complete a business combination, we will repay such loans only from funds held outside of the trust account. In the event that we receive notice from our sponsor five days prior to the deadline of its intent to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the deadline. In addition, we intend to issue a press release the day after the Table of Contents deadline announcing whether or not the funds had been timely deposited. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. Anticipated expenses and funding sources Unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use, except the withdrawal of interest to pay our taxes and/or to redeem our public shares in connection with an amendment to our amended and restated certificate of incorporation, as described above. The proceeds held in the trust account will be invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. We estimate the interest earned on the trust account will be approximately $252,500 per year, assuming an interest rate of 0.1% per year; however, we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from such interest withdrawn from the trust account and: the net proceeds of this offering and the sale of the private placement warrants not held in the trust account, which initially will be approximately $3,355,000 in working capital after the payment of approximately $645,000 in expenses relating to this offering; and any loans or additional investments from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation to advance funds or invest in us, and provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of our initial business combination. Up to $1,500,000 of such loans may be convertible into private placement warrants, at a price of $1.00 per warrant, at the option of the lender. Conditions to completing our initial business combination Nasdaq rules require that we must consummate an initial business combination with one or more operating businesses or assets with a fair market value equal to at least 80% of the net assets held in the trust account (net of amounts disbursed to management for working capital purposes, if permitted, and excluding the Marketing Fee). Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm which is a member of FINRA or a valuation or appraisal Table of Contents Item 16. Exhibits and Financial Statement Schedules. (a) Exhibits. The following exhibits are being filed herewith: EXHIBIT INDEX Exhibit No. Description 1.1 Form of Underwriting Agreement.** 1.2 Form of Business Combination Marketing Agreement between the Registrant and the underwriters.** 3.1 Certificate of Incorporation.* 3.2 Form of Amended and Restated Certificate of Incorporation.* 3.3 Bylaws.* 4.1 Specimen Unit Certificate.** 4.2 Specimen Class A Common Stock Certificate.** 4.3 Specimen Warrant Certificate.* 4.4 Form of Warrant Agreement between Continental Stock Transfer & Trust Company and the Registrant.* 5.1 Opinion of Winston & Strawn LLP.* 10.1 Form of Letter Agreement among the Registrant, Seven Oaks Sponsor II LLC and each of the executive officers and directors of the Registrant.* 10.2 Form of Investment Management Trust Agreement between Continental Stock Transfer & Trust Company and the Registrant.** 10.3 Form of Registration Rights Agreement among the Registrant, Seven Oaks Sponsor II LLC and the Holders signatory thereto.* 10.4 Form of Private Placement Warrants Purchase Agreement between the Registrant and Seven Oaks Sponsor II LLC.** 10.5 Form of Indemnity Agreement.** 10.6 Promissory Note issued to Seven Oaks Sponsor II LLC.* 10.7 Securities Subscription Agreement between the Registrant and Seven Oaks Sponsor II LLC.* 10.8 Securities Subscription Agreement between the Registrant and JTCM Ventures LLC* 10.9 Form of Administrative Services Agreement between the Registrant and Tamarix Capital Management LLC.* 10.10 Form of Private Placement Warrants Issuance Agreement between the Registrant, Jones & Associates, Inc. and JTCM Ventures LLC** 14 Form of Code of Ethics.** 23.1 Consent of Marcum LLP.* 23.2 Consent of Winston & Strawn LLP (included on Exhibit 5.1).* Table of Contents firm. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of the target s assets or prospects. We will complete our initial business combination only if the post- transaction company in which our public stockholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or is otherwise not required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to our initial business combination may collectively own a minority interest in the post business combination company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock or shares of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post- transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test described above, provided that in the event that the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as our initial business combination for purposes of a seeking stockholder approval or conducting a tender offer, as applicable. Permitted purchases of public shares and public warrants by our affiliates If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, initial stockholders, directors, executive officers, advisors or their affiliates may purchase shares or public warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. There is no limit on the number of shares our initial stockholders, directors, officers, advisors or their affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. Any such price per share may be different than the amount per share a public stockholder would Table of Contents receive if it elected to redeem its shares in connection with our initial business combination. Additionally, at any time at or prior to our initial business combination, subject to applicable securities laws (including with respect to material non-public information), our initial stockholders, directors, officers, advisors or their affiliates may enter into transactions with investors and others to provide them with incentives to acquire public shares, vote their public shares in favor of our initial business combination or not redeem their public shares. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds held in the trust account will be used to purchase shares or public warrants in such transactions. If they engage in such transactions, they will be restricted from making any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. We expect any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. See Proposed Business Permitted Purchases of Our Securities for a description of how our sponsor, initial stockholders, directors, officers, advisors or any of their affiliates will select which stockholders to purchase securities from in any private transaction. The purpose of any such purchases of shares could be to (i) vote such shares in favor of the business combination and thereby increase the likelihood of obtaining stockholder approval of the business combination, (ii) satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met or (iii) reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrantholders for approval in connection with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our Class A common stock or warrants may be reduced and the number of beneficial holders of our securities Table of Contents may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange Redemption rights for public stockholders upon completion of our initial business combination We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations and on the conditions described herein. The amount in the trust account is initially anticipated to be $10.10 per public share. The per share amount we will distribute to investors who properly redeem their shares will not be reduced by the Marketing Fee. See the section entitled Underwriting Business Combination Marketing Agreement. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our initial stockholders, sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares they hold and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination. Manner of conducting redemptions We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a stockholder meeting called to approve the business combination or (ii) without a stockholder vote by means of a tender offer. The decision as to whether we will seek stockholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval under applicable law or stock exchange listing requirements. Asset acquisitions and share purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding Class A common stock or seek to amend our amended and restated certificate of incorporation would require stockholder approval. So long as we obtain and maintain a listing for our securities on Nasdaq we will be required to comply with Nasdaq s stockholder approval rules. The requirement that we provide our public stockholders with the opportunity to redeem their public shares by one of the two methods listed above will be contained in provisions of our amended and restated certificate of incorporation and will Table of Contents apply whether or not we maintain our registration under the Exchange Act or our listing on Nasdaq. Such provisions may be amended if approved by holders of 65% of our common stock entitled to vote thereon. If we provide our public stockholders with the opportunity to redeem their public shares in connection with a stockholder meeting, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A under the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and file proxy materials with the SEC. If we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the Company representing a majority of the voting power of all outstanding shares of capital stock of the Company entitled to vote at such meeting. Our initial stockholders will count towards this quorum and, pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote any founder shares they hold and any public shares purchased during or after this offering (including in open market and privately-negotiated transactions) in favor of our initial business combination. For purposes of seeking approval of the majority of our outstanding shares of common stock voted, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. As a result, in addition to our initial stockholders founder shares, we would need only 9,375,001, or 37.5%, of the 25,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming all outstanding shares are voted and the over-allotment option is not exercised). These quorum and voting thresholds, and the voting agreements of our initial stockholders, may make it more likely that we will consummate our initial business combination. Each public stockholder may elect to redeem its public shares irrespective of whether they vote for or against the proposed transaction or whether they were a stockholder on the record date for the stockholder meeting held to approve the proposed transaction. If a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other legal reasons, we will: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E under the Exchange Act, which regulate issuer tender offers, and Table of Contents file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about our initial business combination and the redemption rights as is required under Regulation 14A under the Exchange Act, which regulates the solicitation of proxies. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public stockholders not tendering more than the number of public shares we are permitted to redeem. If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete such initial business combination. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase shares of our Class A common stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act. We intend to require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to, at the holder s option, either deliver their stock certificates to our transfer agent or deliver their shares to our transfer agent electronically using The Depository Trust Company s DWAC (Deposit/ Withdrawal At Custodian) system, prior to the date set forth in the proxy materials or tender offer documents, as applicable. In the case of proxy materials, this date may be up to two business days prior to the date on which the vote on the proposal to approve the initial business combination is to be held. In addition, if we conduct redemptions in connection with a stockholder vote, we intend to require a public stockholder seeking redemption of its public shares to also submit a written request for redemption to our transfer agent two business days prior to the vote in which the name of the beneficial owner of such shares is included. The proxy materials or tender offer documents, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public stockholders to satisfy such delivery requirements. We believe that this will allow our transfer agent to efficiently process any redemptions without the need for further communication or action from the redeeming public stockholders, which could delay redemptions and result in additional administrative cost. If the proposed initial business Table of Contents combination is not approved and we continue to search for a target business, we will promptly return any certificates or shares delivered by public stockholders who elected to redeem their shares. Our amended and restated certificate of incorporation will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001. In addition, our proposed initial business combination may impose a minimum cash requirement for: (i) cash consideration to be paid to the target or its owners, (ii) cash for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions. In the event the aggregate cash consideration we would be required to pay for all shares of Class A common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will not complete the initial business combination or redeem any shares in connection with such initial business combination, and all shares of Class A common stock submitted for redemption will be returned to the holders thereof. We may, however, raise funds through the issuance of equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements or backstop arrangements we may enter into following consummation of this offering, in order to, among other reasons, satisfy such net tangible assets or minimum cash requirements. Limitation on redemption rights of stockholders holding 15% or more of the shares sold in this offering if we hold a stockholder vote Notwithstanding the foregoing redemption rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. We believe the restriction described above will discourage stockholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public stockholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if Table of Contents such holder s shares are not purchased by us, our sponsor or our management at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders ability to vote all of their shares (including all shares held by those stockholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be used to pay amounts due to any public stockholders who exercise their redemption rights as described above under Redemption rights for public stockholders upon completion of our initial business combination, to pay the Marketing Fee, and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post- transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our amended and restated certificate of incorporation will provide that we will have only 18 months from the closing of this offering (or up to 24 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) to complete our initial business combination. If we are unable to complete our initial business combination within such 18-month period (or up to 24 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) or during any Extension Period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public Table of Contents stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, liquidate and dissolve, subject, in each case, to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within the 18-month time period (or up to 24 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus). Our initial stockholders have entered into agreements with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within 18 months from the closing of this offering (or up to 24 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) or any extended period of time that we may have to consummate an initial business combination as a result of an amendment to our amended and restated certificate of incorporation. However, if our initial stockholders or management team acquire public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted 18-month time frame (or up to 24 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus). In the event we do not complete our initial business combination and subsequently liquidate, the underwriters will not receive the Marketing Fee and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. Our sponsor, executive officers, directors and director nominees have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering (or up to 24 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) or with respect to any other material provisions relating to stockholders rights or pre-initial business Table of Contents combination activity, unless we provide our public stockholders with the opportunity to redeem their Class A common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations described above under Limitations on redemptions. For example, our board of directors may propose such an amendment if it determines that additional time is necessary to complete our initial business combination. In such event, we will conduct a proxy solicitation and distribute proxy materials pursuant to Regulation 14A under the Exchange Act seeking stockholder approval of such proposal, and in connection therewith, provide our public stockholders with the redemption rights described above upon stockholder approval of such amendment. Limited payments to insiders There will be no finder s fees, reimbursement, consulting fee, monies in respect of any payment of a loan or other compensation paid by us to our sponsor, officers or directors, or any affiliate of our sponsor or officers prior to, or in connection with any services rendered in order to effectuate, the consummation of our initial business combination (regardless of the type of transaction that it is). However, the following payments will be made to our sponsor, officers or directors, or our or their affiliates, and, if made prior to our initial business combination will be made from funds held outside the trust account. Repayment of up to an aggregate of $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; Payment to an affiliate of our sponsor of $25,000 per month for office space, secretarial and administrative services provided to members of our management team; Reimbursement for any out-of-pocket expenses related to identifying, investigating, negotiating and completing an initial business combination; and Repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination. Up to $1,500,000 of such loans may be convertible into warrants of the post-business combination entity at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants. Except for the foregoing, the terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. Table of Contents Audit Committee We will establish and maintain an audit committee, which will be composed entirely of independent directors. Among its responsibilities, the audit committee will review on a quarterly basis all payments that were made to our sponsor, officers, directors or our or their affiliates, or any of their affiliates, and monitor compliance with the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to promptly take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled Management Committees of the Board of Directors Audit Committee. Conflicts of Interest Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to another entity pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such entity. Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation. We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our initial business combination. For more information, see the section entitled Management Conflicts of Interest. In addition, our sponsor and our officers and directors may sponsor or form other special purpose acquisition companies similar to ours or may pursue other business or investment ventures during the period in which we are seeking an initial business combination. Any such companies, businesses or investments may present additional conflicts of interest in pursuing an initial business combination. However, we do not believe that any such potential conflicts would materially affect our ability to complete our initial business combination because our management team has significant experience in identifying and executing multiple acquisition opportunities simultaneously, and as we believe there are a number of potential opportunities within the industries and geographies of our primary focus. Table of Contents SUMMARY FINANCIAL DATA The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. December 31, 2021 Balance Sheet Data: Total assets $ 203,001 Total liabilities $ 180,943 Total stockholders equity $ 22,058 Table of Contents RISKS
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and articles of association are to the amended and restated memorandum and articles of association that the company will adopt prior to the consummation of this offering; Companies Act are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; directors are to our current directors named in this prospectus; forward purchase agreement is to the forward purchase agreement providing for the sale of forward purchase shares by us to the forward purchaser in a private placement that will close concurrently with the closing of our initial business combination; forward purchase shares are to the Class A ordinary shares purchased pursuant to the forward purchase agreement; forward purchaser is to the affiliate of our sponsor, with which we will enter into the forward purchase agreement; founder shares are to our Class B ordinary shares initially issued to our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof (for the avoidance of doubt, such Class A ordinary shares will not be public shares ); management or our management team are to our executive officers and directors; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares, collectively; private placement warrants are to the warrants to be issued to our sponsor in a private placement simultaneously with the closing of this offering and upon conversion of any working capital loans or sponsor loans to fund payments required to exercise our right to extend the period of time we have to complete our initial business combination; public shares are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders are to the holders of our public shares, including our sponsor and management team to the extent our sponsor and/or members of our management team purchase public shares, provided that our sponsor s and each member of our management team s status as a public shareholder will only exist with respect to such public shares; sponsor are to Sound Point Acquisition Sponsor I, LLC, a Delaware limited liability company; and we, us, our, company or our company are to Sound Point Acquisition Corp I, Ltd, a Cayman Islands exempted company. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED FEBRUARY 18, 2022 PRELIMINARY PROSPECTUS Sound Point Acquisition Corp I, Ltd $200,000,000 20,000,000 Units Sound Point Acquisition Corp I, Ltd is a blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target. We will not be limited to a particular industry or geographic region in our identification and acquisition of a target company. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share and one-half of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as described herein. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. The warrants will become exercisable 30 days after the completion of our initial business combination, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. The underwriters have a 45-day option from the date of this prospectus to purchase up to 3,000,000 additional units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination, subject to the limitations as described herein. If we have not consummated an initial business combination within 15 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate our initial business combination, as described in more detail below), we will redeem 100% of the public shares for cash, subject to applicable law and certain conditions as described herein. If we anticipate that we may not be able to consummate an initial business combination within 15 months, we may, by resolution of our board if requested by our sponsor, extend the period of time to consummate an initial business combination by an additional three months on two separate occasions (after the exercise of both extensions, we will have a total of up to 21 months to complete an initial business combination). Our public shareholders will not be offered the opportunity to vote on or redeem their shares in connection with any such extension. In order to extend the time available for us to consummate our initial business combination, we, upon five days advance notice prior to the applicable deadline, must deposit into the trust account for each three month extension (of which there may be no more than two such extensions) $2,000,000, or $2,300,000 if the underwriters over-allotment option is exercised in full ($0.10 per share in either case), on or prior to the date of the applicable deadline. Any such extension payments would be funded from the proceeds of a non-interest bearing loan from our sponsor to us. The terms in connection with such loans have not been negotiated and will only be finally determined at the time of entry into such loans. If we complete our initial business combination, we expect that we would repay such loaned amounts in cash out of the proceeds of the trust account released to us, or, at the discretion of our sponsor, such loans will be satisfied by the issuance of private placement warrants (as defined below) at a price per warrant of $1.00. The warrants would be identical to the private placement warrants issued to our sponsor concurrently with the consummation of this offering. Our sponsor may elect to satisfy the loans by the issuance of private placement warrants at or prior to the time of the business combination. Our sponsor, Sound Point Acquisition Sponsor I, LLC, has agreed to purchase 12,500,000 warrants (or 14,000,000 warrants if the underwriters over-allotment option is exercised in full), each exercisable to purchase one Class A ordinary share at $11.50 per share, subject to adjustment as described herein, at a price of $1.00 per warrant, in a private placement that will close concurrently with the closing of this offering. We refer to these warrants throughout this prospectus as the private placement warrants. Our initial shareholders currently own 5,750,000 Class B ordinary shares (which we refer to as founder shares throughout this prospectus), up to 750,000 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described herein. Prior to our initial business combination, only holders of our Class B ordinary shares will be entitled to vote on the election of directors. In addition, with respect to any vote or votes to continue the company in a jurisdiction outside the Cayman Islands in accordance with the amended and restated memorandum and articles of association (including, but not limited to, the approval of the organizational documents of the company in such other jurisdiction), holders of Class B ordinary shares will have ten votes for every Class B ordinary share and holders of Class A ordinary shares will have one vote for every Class A ordinary share. In connection with the consummation of this offering, we will enter into a forward purchase agreement with an affiliate of our sponsor, which we refer to as the forward purchaser, pursuant to which the forward purchaser will commit to purchase from us $50.0 million of Class A ordinary shares, which we refer to as the forward purchase shares, at a price of $10.00 per share as described in the forward purchase agreement, in a private placement that will close concurrently with the closing of our initial business combination. The proceeds from the sale of these forward purchase shares, together with the amounts available to us from the trust account (after giving effect to any redemptions of public shares) and any other equity or debt financing obtained by us in connection with the business combination, will be used to satisfy the cash requirements of the business combination, including funding the purchase price, paying expenses and retaining specified amounts to be used by the post-business combination company for working capital or other purposes. At our option, the forward purchaser may purchase less forward purchase shares in accordance with the terms of the forward purchase agreement. In addition, the forward purchaser s commitment under the forward purchase agreement will be subject to approval, prior to our entering into a definitive agreement for our initial business combination, of the forward purchaser s investment committee. The forward purchase shares will be identical to the Class A ordinary shares included in the units being sold in this offering, except that they will be subject to transfer restrictions and registration rights, as described herein. Currently, there is no public market for our securities. We intend to apply to have our units listed on the Nasdaq Global Market ( Nasdaq ) under the symbol SPCMU. We expect that the Class A ordinary shares and warrants comprising the units will begin separate trading on Nasdaq under the symbols SPCM and SPCMW, respectively, on the 52nd day following the date of this prospectus unless BofA Securities, Inc. and J.P. Morgan Securities LLC permit earlier separate trading and we have satisfied certain conditions. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 44 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 200,000,000 Underwriting discounts and commissions(1) $ 0.55 $ 11,000,000 Proceeds, before expenses, to us $ 9.45 $ 189,000,000 (1) Includes $0.35 per unit, or $7,000,000 in the aggregate (or $8,050,000 in the aggregate if the underwriters over-allotment option is exercised in full), payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein and released to the underwriters only upon the consummation of an initial business combination. See also Underwriting for a description of compensation payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $206,000,000, or $236,900,000 if the underwriters over-allotment option is exercised in full ($10.30 per unit in either case), will be deposited into a U.S. based trust account with Continental Stock Transfer & Trust Company acting as trustee. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2022. Joint Book-Running Managers BofA Securities J.P. Morgan Co-Managers AmeriVet Securities SPC Capital Markets The date of this prospectus is , 2022 Table of Contents Any forfeiture of shares described in this prospectus will take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option and the forfeiture by our sponsor of 750,000 founder shares. General We are a newly organized blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business combination. We have not identified any business combination target, and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target. We intend to effectuate our initial business combination using cash from the proceeds of this offering and the sale of the private placement warrants, debt or a combination of cash, shares of stock and debt. Our sponsor is an affiliate of Sound Point Capital Management, LP ( Sound Point ), a registered investment advisor with a particular expertise in credit strategies. Given Sound Point s investment track record and the intention for our company to leverage such capabilities to identify attractive business combination targets and complete our initial business combination, we believe our company has the required experience and resources to execute a successful business combination with compelling risk-adjusted returns for our shareholders. Although we may pursue an acquisition in a number of industries or geographies, we intend to concentrate our efforts in sectors where Sound Point maintains a deep level of relationships and expertise. We also seek to capitalize on the multiple decades of combined investment and operational experience of our management team. Our management team consists of Stephen Ketchum Chairman and Chief Executive Officer, Marc Sole President and Director Nominee, David Grill Chief Financial Officer and Director Nominee, and, Philip Bartow Head of Corporate Development. Experience among our seasoned management and non-executive directors include senior executive management positions at financial institutions and investment firms. In addition, our non-executive directors have extensive operating and executive experience in several industries that will be a focus of our company, including technology, media and consumer brands, among others. About Our Sponsor Our sponsor, Sound Point Acquisition Sponsor I, LLC, is an affiliate of Sound Point. Founded in 2008 by Stephen Ketchum, Sound Point is an alternative asset manager with approximately $29.9 billion in assets under management ( AUM ) as of November 30, 2021. Sound Point has deep investing expertise across various credit strategies, including performing credit, stressed and distressed investing, alternative lending, direct lending, structured products, specialty financing and commercial real estate. Private investors are able to access Sound Point s strategies through its collateralized loan obligations ( CLOs ), commingled funds, drawdown vehicles and separately managed accounts. Sound Point is focused on preserving investor capital and delivering consistent and strong risk-adjusted returns with low volatility across market cycles. Founder and Chief Investment Officer, Stephen Ketchum, brings over 31 years of experience in credit investing, structuring and advisory and leads a team of over 65 investment professionals with deep experience in the credit markets. Sound Point s investment team is supported by an institutionalized operational infrastructure and is enhanced through its partnership with Table of Contents Stone Point Capital LLC ( Stone Point ) and Dyal Capital Partners Fund II, a third-party permanent capital fund that is managed by the Dyal Capital division of Blue Owl Capital Inc. ( Dyal ), both which have held minority interest in Sound Point since 2009 and 2017, respectively. Sound Point operates 12 funds and additional platforms across multiple credit and private asset strategies. Its AUM is broken out over five segments: Performing Credit & CLOs, Opportunistic Credit, Private Credit, Structured Credit and Commercial Real Estate Credit. Performing Credit & CLOs represents a majority of the assets, approximately 73%, and was $22 billion as of November 2021. The remaining four segments represent 2%, 8%, 6% and 10% of total AUM, respectively. As of November 2021, Opportunistic Credit had a total AUM of $665 million, Private Credit had a total AUM of $2.5 billion, Structured Credit had a total AUM of $1.7 billion and Commercial Real Estate Credit had a total AUM of $3.0 billion. Sound Point launched its first product, the Sound Point Credit Opportunities Fund, in September 2009. Today, Sound Point is predominantly focused on U.S. and European investment opportunities. The firm is headquartered in New York City with an additional office in London. Sound Point has attracted a committed base of investors since its founding, further contributing to the institutionalization and growth of its investment platform. Its equity partners, which include certain principals of the management company of Stone Point and Dyal, are dedicated to the success of both the sponsor and the special purpose acquisition company ( SPAC ) initiative and continue to be a source of institutional support. Stephen Friedman and Chuck Davis, founders of $41.2 billion AUM private equity firm Stone Point Capital, seeded Sound Point s first fund in September 2009 along with three other senior principals and have a minority equity ownership in the firm. In March 2017, Dyal took a passive, minority stake in the firm. The capital provided by Dyal has been used by Sound Point to seed and / or invest in existing strategies and new initiatives within the firm. Together, these investments and the broader investment and intellectual support from Stone Point and Dyal have further enabled Sound Point to grow its platform and capitalize on new opportunities. Stephen Ketchum serves as the Founder, Managing Partner and Chief Investment Officer of Sound Point. Mr. Ketchum oversees Sound Point s investments across all fund offerings and is also the lead Portfolio Manager for certain funds. The operational team includes 45 members whose prior roles were at firms such as Cerberus, Blue Mountain, Morgan Stanley, J.P. Morgan and UBS. Principals are dedicated to spending 100% of their professional time on Sound Point-related activities and are expected to be instrumental to our success. Sound Point s senior portfolio management team has an average of 24 years experience in the credit markets. The collective experience of dedicated investment teams seeks to optimize information flow and value creation. Stephen Ketchum and his team of senior leadership have worked to build a collaborative culture that spans across all strategies, creating on cohesive investment process. The engine behind Sound Point s sourcing capabilities stems from its 22-person loan team, which focuses on covering over half of the broadly-syndicated loan market s leveraged issuers, creating a deep information bank across industry and individual credits. Sound Point overlays this knowledge with other teams expertise regarding bankruptcies and restructuring, originating rescue financing and specialty financing with the goal of maximizing value. The synergies across these businesses are key to Sound Point s growth and ability to establish a broad network across the markets. As a result, Sound Point believes it is well positioned to identify, underwrite and execute on an initial business combination. Since its inception in 2009, we believe Sound Point has generated compelling risk-adjusted returns for its investors seeking exposure to segments of the credit markets which match their target risk profiles and liquidity needs. Sound Point s strong investment track-record across various asset classes demonstrates the financial acumen of its investment team and the institutional advantage of the Sound Point platform as a prospective SPAC sponsor. Table of Contents In June 2021, Sound Point acquired the U.S. direct lending ( U.S. DL ) platform of CVC Credit, the dedicated credit arm of CVC Capital Partners. As part of this strategic transaction, the current U.S. DL team of nine investment professionals has transitioned to Sound Point, augmented by one additional hire the team has already made. In addition to the U.S. DL personnel, Sound Point has acquired approximately $1 billion of assets across several commingled drawdown funds and separately managed accounts. Sound Point expects the U.S. DL business line to lend its experience in sourcing and valuing investment opportunities and to provide advisory support to our business. Members of Sound Point s investment team currently sit on six boards of directors and have been involved in appointing members to other boards of directors. These experiences have broadened Sound Point s capabilities when working with other companies management teams, enabling Sound Point to provide advice and insights to prepare companies for their next steps whether that be emerging from bankruptcy or accessing the capital markets for liquidity and growth capital. With respect to the foregoing experiences of Sound Point and our management, past performance is not a guarantee (i) that we will be able to identify a suitable candidate for our initial business combination or (ii) of success with respect to any business combination we may consummate. You should not rely on the historical record of Sound Point or our management s performance as indicative of our future performance. For more information on the experience and background of our management team, see the sections entitled Management, and Proposed Business. Key Members of Management and Board Our Management Team We are led by highly qualified individuals with decades of executive investment experience across several sectors and investment strategies. Our management team will consist of Stephen Ketchum Chairman and Chief Executive Officer, Marc Sole President and Director Nominee, David Grill Chief Financial Officer and Director Nominee, and Philip Bartow Head of Corporate Development. Our management team will be supported by the broader Sound Point management and investment team as well as our non-executive directors. Stephen Ketchum Chairman and Chief Executive Officer Mr. Ketchum is the Founder, Managing Partner and Chief Investment Officer of Sound Point, overseeing Sound Point s investments across all fund offerings. In addition, Mr. Ketchum is the lead Portfolio Manager for the Sound Point Credit Opportunities Fund and a number of other accounts. Mr. Ketchum chairs the Management Committee and sits on most committees at the firm. A veteran with over 31 years experience in the credit markets, Mr. Ketchum founded Sound Point in 2008. Previously, he was Global Head of Media & Telecom Investment and Corporate Banking for Bank of America Securities ( BofA ), where he was a member of the Global Investment Banking Leadership Team. As Global Head of Media & Telecom Banking, Mr. Ketchum was responsible, together with a risk partner, for a multi-billion dollar portfolio of bank and bridge loans. Prior to joining BofA, he was a Managing Director at UBS in the TMT Investment Banking Group. From 1990 to 2000, he was employed in the Investment Banking Department of Donaldson, Lufkin & Jenrette, most recently as a Managing Director. Mr. Ketchum is a member of the Board of Directors of Cirque Du Soleil Entertainment Group, a member of the Board of Managers of the East Side House Settlement, a member of the Board of Trustees of the New York Police & Fire Widows & Children s Benefit Fund and the Museum of the City of New York, and a member of the Board of Directors of CitySquash. Mr. Ketchum earned a B.A. from New England College, magna cum laude, and an M.B.A. from the Harvard Business School. Marc Sole President and Director Nominee Mr. Sole has been an investor focusing on stressed and distressed corporate credit for over 20 years. He joined Sound Point in 2015 where he currently leads the firm s opportunistic credit strategies. He serves on the Table of Contents firm s Management Committee and is a member on most risk, investment and valuation committees at the firm. Mr. Sole began his career practicing law at Cravath, Swaine & Moore LLP where he focused on mergers & acquisitions and representing lenders and securities underwriters. Mr. Sole joined D. E. Shaw & Co in 2001, where he became the first analyst in the firm s Distressed Securities Group and eventually became a portfolio manager of the firm s U.S. Credit Opportunities strategy. He subsequently held portfolio management positions at Plainfield Asset Management and Hudson Bay Capital Management prior to joining Sound Point. Mr. Sole is a member of the Board of Directors of Vesco Oil Corporation, and the parent companies of Ecobat Technologies and Relativity Media and has previously served on the Board of Directors of Owens Corning, Schuff International and several private specialty finance companies. Mr. Sole graduated cum laude with an A.B. from Princeton University s School of Public and International Affairs and received a J.D. from the Columbia University School of Law where he was a Harlan Fiske Stone Scholar. David Grill Chief Financial Officer and Director Nominee Mr. Grill joined Sound Point in 2015 and is currently Head of Strategy. Additionally, Mr. Grill serves on the firm s Management Committee and Strategic Planning Committee and is on the Board of Advisors of Sound Point Commercial Real Estate Finance LLC, an affiliate of Sound Point. Mr. Grill is responsible for managing all of Sound Point s strategic, product development and expansion initiatives, which has included acquisitions, capital raising, joint ventures, distribution relationships, fund formation and extensions into new products and business lines. Prior to joining Sound Point, Mr. Grill spent nine years as an investment banker at Credit Suisse, where he was a Managing Director in the Financial Institutions Group. He also developed insurance strategies and platforms for Credit Suisse Asset Management. Previously, Mr. Grill was a senior banker at Bear Stearns and Sagent Advisors and held a number of executive positions at Reliance Group Holdings. Throughout his career, Mr. Grill provided mergers and acquisitions, capital raising and strategic advisory services to a broad variety of insurance and healthcare companies, asset managers, government entities, financial institutions and private equity firms. Mr. Grill earned a B.S. in Economics from Cornell University and an M.B.A. from New York University. Philip Bartow Head of Corporate Development Mr. Bartow joined Sound Point in 2019 and is currently Portfolio Manager and Head of Specialty Finance and FinTech Lending Strategy. Mr. Bartow has 17 years of experience in investment management, capital markets and investment banking with a focus on specialty finance, financial technology ( FinTech ), marketplace lending, consumer finance, structured finance, and securitized products. Among the areas Mr. Bartow focuses on are consumer credit including private label credit cards, unsecured whole loans, student loans, debt consolidation loan and charged-off loans purchase programs; small business receivables originated and serviced by payments processing companies; other FinTech opportunities such as acquisition financing and marketing spend financing within the e-commerce and new media markets; and opportunistic investing in private asset backed securities (ABS). Prior to joining Sound Point, Mr. Bartow was a Portfolio Manager at RiverNorth Capital Management, where he led all FinTech and marketplace lending investments for the firm across two funds. Prior to his four years at RiverNorth, Mr. Bartow was a Principal at Spring Hill Capital Partners, where he focused on the research and trading of consumer ABS, consumer whole loan pools, CMBS credit and CLO debt and equity. Mr. Bartow began his career in the Securitized Products Group at Lehman Brothers, where he focused on trading asset-backed securities and loans. Mr. Bartow earned a B.A. in Economics from Williams College and an M.B.A. from Columbia Business School. Our Independent Director Nominees Sean Bratches Mr. Bratches has over 30 years of public and private equity company leadership and operating experience in the media, entertainment, and sports sectors. Currently, Mr. Bratches is the Chief Commercial Officer at LIV Table of Contents Golf Investments, an investment platform focused on fostering the growth of the game around the globe. Previously he was a Senior Advisor to McKinsey & Company, a position he has held since 2020, and Senior Advisor to Sixth Street Partners, a position he has held since 2021. Sixth Street Partners is an affiliate of Dyal, a minority owner of Sound Point. Mr. Bratches is also currently serving as Chairman of the Board of Directors of Anuvu (formerly Global Eagle Entertainment). Prior to McKinsey, Mr. Bratches joined Formula 1 upon Liberty Media s acquisitions of the motorsports entity and he served three years as Managing Director of Commercial Operations for Formula 1, followed by one year as Senior Advisor of Liberty Media Prior to Formula 1, Mr. Bratches spent nearly three decades at ESPN, most recently serving as Executive Vice President of Sales and Marketing from 2005 to 2015 and Mr. Bratches served on the ESPN Board of Directors from 2004 to 2015. He is an early-stage investor in new media platforms focusing on the sports and media sectors. Mr. Bratches earned his bachelor s degree in business administration from the Rochester Institute of Technology. Winifred (Winnie) Park Ms. Park is a retail and marketing leader with over 20 years of industry experience. Ms. Park currently serves as the Chief Executive Officer of Forever 21, an iconic fast-fashion retailer which is a subsidiary of SPARC, a joint venture between Authentic Brands and Simon Property Group. Prior to this appointment, she served as the Chief Executive Officer of The Paper Source, Inc., an omni-channel specialty retailer from 2015 to 2021 ( Paper Source ). She also currently serves on the board of directors and is a member of the Audit Committee of the board of directors of Dollar Tree Stores. She previously served on the board of directors of Express, Inc., starting in June 2018, and left that role in January 2022 in connection with her appointment as the Chief Executive Officer of Forever 21. From 2006 to 2015, Ms. Park served in various roles at DFS Group Ltd including Executive Vice President of Global Marketing and eCommerce and Global Vice President of Fashion. Prior to DFS Group, Ms. Park worked for the Dockers brand at Levi Strauss & Co as Senior Director of Women s Merchandising and prior to this role, Director of Global Strategy. Earlier in her career, Ms. Park served as an engagement manager at McKinsey & Company. Ms. Park graduated with a bachelor s degree in Public and International Affairs from Princeton University and an MBA in Corporate Finance and Marketing from Northwestern University. Matthew Burton Mr. Burton is a Fintech and Adtech veteran with over 15 years of experience. Mr. Burton has served as a Partner at QED Investors ( QED ) since August 2018, focusing on providing early-stage capital to domestic and international FinTech companies. Prior to QED, he was Chief Executive Officer and Co-Founder of Orchard Platform, a provider of loan data to financial institutions which was sold to Kabbage in 2018, which was later sold to American Express in 2020. Prior to co-founding Orchard, Mr. Burton worked in the Adtech industry at AdMeld, which was sold to Google in 2011, and LiveRail, which was sold to Facebook in 2014. Mr. Burton currently serves as a board member of Capchase, Trellis, Bitso, Wayflyer and several other FinTech companies. He earned his bachelor s degree at Sewanee: The University of The South. Tracy Dolgin Mr. Dolgin is a media veteran with over 30 years of experience and is currently a Senior Advisor at the Raine Group LLC, a merchant bank specializing in technology, media and telecom. Mr. Dolgin joined YES Network as President and CEO in 2004 and was named Non-Executive Chairman in 2016. Mr. Dolgin transitioned from Non-Executive Chairman to Board Member in 2017 and served in that capacity until 2018. Prior to joining YES Network, he served as Managing Director and Co-Head of Houlihan Lokey s Media, Sports and Entertainment practice. Prior to this, Mr. Dolgin was President of FOX Sports Net and also served as Chief Operating Officer of FOX/Liberty Cable. Mr. Dolgin was one of the founders of FOX Sports and served as Executive Vice President of Marketing at FOX Sports at the division s inception in 1993. Mr. Dolgin s prior roles include Senior Vice President Table of Contents of Marketing at HBO Video and product manager at General Foods. He earned a bachelor s degree in Industrial and Labor Relations from Cornell University and an MBA from Stanford University. Business Strategy Institutionalized platform supporting our sourcing capabilities Sound Point is a registered investment advisor with a long-standing investment track record in the credit markets. Sound Point has over $29.9 billion in AUM as of November 30, 2021 and has developed long-lasting relationships with our limited partner investors from four different continents. Sound Point is among the leading capital allocators in the North American broadly-syndicated loan market, and has built an extensive investment sourcing network in the U.S. with over 100 employees. Sound Point has an experienced global team of 66 investment professionals who have a particular expertise in credit strategies and who regularly review investment opportunities across all sectors within the leveraged credit markets, specialty finance markets and commercial real estate market. Sound Point s range of coverage, industry expertise and dedicated focus to the opportunity provide a competitive advantage to yield proprietary deal flow. Approximately half of Sound Point s investment professionals sit in its Performing Credit and CLOs business, which includes the U.S. par loans strategy. Sound Point covers over 750 leveraged issuers on the par loan side as a result of being a $22 billion participant in the leveraged loan market. The par loan team has also become a sourcing resource for Sound Point s opportunistic strategies, as they provide both industry and credit expertise that is otherwise not available to smaller, standalone investment firms. The par loan team has long-standing relationships with loan issuers and are familiar to many management teams that we believe could be a significant source of business combination opportunities. In particular, we believe the 22-person par loan team s scale, sector expertise and influence will enable us to gain access to management teams of potential target businesses. Sound Point leverages this information flow across a variety of its products, including the Tactical Loan Opportunity Fund (drawdown fund), the Strategic Capital Fund (drawdown fund), the Credit Opportunities Fund (long/short hedge fund) and Harbor Fund (third-party managed CLO fund). As a result of this two-way flow across Sound Point, this collaboration built into the investment process will fuel introductions and referrals to our SPAC sourcing team by meaningfully adding to our network of private companies. On the specialty financing side, Sound Point reviews 70-100 companies each year from venture capital partners and our existing relationship network. The number of issuers Sound Point has financed and the many other opportunities reviewed highlight the breadth of the ideas that Sound Point will ultimately funnel to execute an initial business combination. While the bulk of the sponsors pricing SPACs today are mostly focused on VC-backed high-growth companies, many of which operate in less established and still unprofitable sectors, we intend to leverage our expertise and networks within the loan market and specialty finance space to pursue initial business combination targets that we believe are less likely to be a focus of most other SPACs. We intend to utilize the full breadth of Sound Point s investment platform to identify a carefully selected opportunity set and to consummate an initial business combination with a target that we believe can generate sustainable and attractive risk-adjusted returns for our shareholders. In addition, we believe Sound Point s longstanding reputation as a value-added lending partner with significant access to primary capital and deep relationships with market participants will provide us with a Table of Contents proprietary pipeline of potential business combination targets that may not be available to competing SPACs and other acquirers. Rigorous investment strategy Sound Point at its core is a bottom-up, fundamental investor that underwrites all investments by taking a capital agnostic approach to a company s balance sheet. As a result, Sound Point is highly skilled in evaluating and investing in private companies and assessing the quality of management teams. The majority of Sound Point s ideas and research is generated internally on a proprietary basis. As a result, Sound Point has proven its repeatable investment approach to its LP investors and partners and, as such, has grown its credit platform from less than $100 million at inception to approximately $29.9 billion in AUM as of November 30, 2021. Sound Point develops internal, proprietary models and analytic tools to assist in evaluating potential investments. Specifically, its rigorous investment process to diligence companies includes analyzing company operating models, cash flows and balance sheet risks across our targeted sectors. The investment process emphasizes recurring revenue, critical products/services, current or potential industry leadership, and free cash flow thus, we expect the core business profile of Sound Point s credit platform borrowers will overlap closely with the attributes of a successful target for our initial business combination. Furthermore, we believe Sound Point s investment process and portfolio monitoring practices will allow us to identify companies that may develop into strong SPAC targets but may not currently be on the radars of competing SPAC sponsors. We expect Sound Point to approach sourcing opportunities in pursuit of an initial business combination for our shareholders with the same analytical rigorousness and balanced risk management framework used to evaluate every investment that Sound Point originates for its own investment funds. In fact, we believe that the investment reach of Sound Point s institutional platform and underwriting process extend beyond credit. A cornerstone of Sound Point s credit underwriting is the full evaluation of a private company s whole capital stack and the detailed assessment of its growth prospects, business plan sustainability and industry positioning, which are also key elements of a SPAC investment process. Sound Point also has significant investing experience with certain classes of equity opportunities, which are generated primarily in connection with our credit strategies. For example, as part of its specialty financing strategy, Sound Point invests in venture capital backed FinTech businesses, for which it combines its knowledge of an emerging company s fundamentals with a nuanced understanding of the accounts receivable and capital markets to optimize a company s cost of capital. Vast network of sourcing relationships and proprietary opportunities Sound Point s unique sourcing capabilities provide a key competitive advantage. As a result of being both a large private credit capital provider and Sound Point s footprint in the specialty financing markets, Sound Point has developed relationships with hundreds of private equity sponsors, VCs, and institutional investors (including large strategic LPs invested across our fund complex). This network has given Sound Point unparalleled access to proprietary opportunities across the lending spectrum and a privileged insight into the capital needs and business profiles of a wide range of private companies. Sound Point maintains exposure to over 750 unique levered issuers within the $22 billion par loan strategy. As a substantial participant in the leveraged loan market, Sound Point s par loan team has become a key sourcing channel for its opportunistic credit and alternative lending strategies because a large part of their deal flow comes through reverse inquiry from management teams, advisors and boards with whom they have worked with in the past. Table of Contents Additionally, Sound Point s partnership with institutionally-backed FinTech companies also provides a strong sourcing advantage. Our team intends to seek unique, uncorrelated receivable streams from specialty finance companies. Today, an increasing number of these specialty finance companies are high-growth, venture-backed companies as the delineation between traditional non-bank lender and technology platform is blurred. Our team is capable of evaluating these receivable streams be it consumer, small business, auto, SaaS receivables in the broader market relative to competitive products, which allows us to formulate a view on the best products in the market alongside the best management teams. Sound Point s ability to provide debt or asset-based financing to FinTech businesses and lower their overall cost of capital gives VCs and other institutional investors a clear incentive to introduce Sound Point to their portfolio companies, providing us with an attractive potential sourcing channel for our SPAC. Sound Point currently has active relationships with a growing number of top-tier VC partners that are active in the FinTech space. Since 2015, nine FinTech-focused companies financed by Sound Point have gone public via initial public offerings or reverse mergers. Of all the companies Sound Point s specialty finance team has engaged with over the past two quarters, the majority are high-growth companies that have completed successful private equity raises. In addition to utilizing internal resources to source a potential transaction, Sound Point believes it can also leverage its relationships within the market to tap into a broad incremental network of potential opportunities. Our Forward Purchase Agreement We believe our ability to complete our initial business combination will be enhanced by the financial commitment we can demonstrate through our forward purchase agreement. We will enter into a forward purchase agreement with the forward purchaser (an affiliate of our sponsor), under which the forward purchaser will agree, subject to certain conditions set forth in the forward purchase agreement, to purchase in the aggregate $50.0 million of forward purchase shares at our option. Each forward purchase share will be sold at a purchase price determined in accordance with the forward purchase agreement, and will be sold in a private placement concurrently with the closing of our initial business combination. The terms of the forward purchase shares will generally be identical to the Class A ordinary shares included in the units being sold in this offering, except that the forward purchaser will be entitled to registration rights and be subject to certain transfer restrictions, as described herein. In addition, the forward purchaser s commitment under the forward purchase agreement will be subject to approval, prior to our entering into a definitive agreement for our initial business combination, of the forward purchaser s investment committee. At our option, the forward purchaser may purchase less forward purchase shares in accordance with the terms of the forward purchase agreement. We believe the capital commitment from the forward purchaser will make us more attractive to a potential business combination target and help us attract growth-oriented investors. While the forward purchaser is not contractually obligated to do so, they may elect to invest additional capital through the purchase of additional Class A ordinary shares or other equity or debt securities to support any business combination we pursue. Investment Opportunity We believe the synergies that have been established across Sound Point s investment platform over the last 12 years will ultimately lead to identifying, underwriting and executing an initial business combination. Due to the evolution of Sound Point s credit platform, we aim to use the same investment process already in place to Table of Contents identify a target company that is public-markets ready. Our platform differentiates our approach to identifying an initial business combination from many other market participants. Target Universe Our target universe encompasses but is not limited to the following sectors: 1. High-growth sectors within the broadly syndicated loan space We will focus on the higher growth sectors within the broadly-syndicated loan space such as the Information Technology ( IT ) Software, Business Services and TMT sectors. For example, the IT sector accounts for 14.84% of the Credit Suisse Leveraged Loan ( CS LL ) Index ($211 billion versus $116 billion 5 years ago) and 6.2% of the Credit Suisse High Yield Index ($61 billion). IT is the fastest growing component of the CS LL Index, having tripled in the last 10 years. 2. Companies sourced from Sound Point s specialty finance platform Sound Point s specialty finance strategy focuses on sourcing consumer and SME collateral from large marketplace lending and FinTech companies. This team has had nine companies, directly financed by Sound Point, go public via IPO or reverse mergers since 2015. When considering the 70-100 companies reviewed each year, the sourcing channels Sound Point is able to utilize come from venture capital partners, its existing network, former colleagues, outreach, and administrative providers (legal, valuation, etc.). As a result, we cover the following segments: lending, payments, specialty finance, buy now pay later, insurance technology, property technology, financial data, asset management and banking platforms. 3. Over-levered companies in need of an asset sale or other catalyst to deleverage their balance sheet We believe we are well suited to tackle this opportunity given Sound Point s seasoned opportunistic credit team. Over their careers, this team has developed essential process expertise when it comes to leveraged credits, having led and invested in various restructurings and workouts across a wide variety of industries and regions. Sound Point ideally would like to have a seat at the table with a company that goes through a restructuring as we believe that we can bring essential knowledge and experience to these situations. We have found that often times the best approach is to conduct an asset sale. Sound Point has previously assisted with the execution of this type of restructuring. 4. Private companies that have accidental owners as a result of a restructuring or bankruptcy The leveraged loan market has doubled in size over the last 10 years. Over the same period, its overall riskiness has increased as well, as evidenced by the percentage of single-B minus rated loans relative to the overall leveraged loan market increasing from around 12% of the market in 2011 to over 25% today. During this time, the secondary trading market for post-reorganized equity has become more illiquid. In our experience, post-bankruptcy equities often end up in the hands of participants who were previously first lien lenders. The fund structures or investment parameters of these accidental owners may not be suited for the duration needed to own volatile, post-reorganization equity. We believe a business combination with a SPAC would be an ideal exit for these investors. Depth of Sound Point s Expertise and Ability to Identify Targets The U.S. leveraged loan market has more than doubled since 2010 to $1.3 trillion in 2020 from $660 billion in 2010, as recorded by the Credit Suisse Leveraged Loan Index. Sound Point owns over 750 unique levered issuers and follows hundreds of other issuers that are not currently owned by its funds. This range of coverage provides a competitive advantage to yield proprietary deal flow. Sound Point s 22-person par loan team, which manages $22 billion of collateral, has long standing relationships with levered issuers and is a familiar face to many management teams given the long-term and steady partnerships. In addition to this sourcing engine, Sound Point is in touch with anywhere from 70-100 specialty lending companies within the Table of Contents FinTech space that could either be SPAC merger targets or another resource that leads us to a potential target. The 800+ issuers outlined above, combined with the broad network across Sound Point s platform as a whole, are key differentiators for Sound Point. The firm marries this information edge with its seasoned portfolio management team (average of 24 years experience) to both source and underwrite potential target companies. The advantage of our large credit platform mixed with the collaborative investment process allows Sound Point to leverage its broad advisor network, existing c-suite network, sponsor network and sell-side relationships, which we believe will ultimately create a repeatable and scalable approach to identifying compelling business combination targets. Investment Criteria We believe the following general criteria and guidelines are important in evaluating prospective targets for our initial business combination. We aim to utilize these criteria in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target that does not meet some or all of these criteria. Our investment criteria guides us to look for a target company with the following characteristics: Differentiated and sustainable business model, with defensible competitive advantages Attractive financial profile with predictable revenues and strong free cash flow Strong and reputable management team with well-defined vision and credible track record History of organic revenue growth and multiple avenues for future growth, including acquisitions Attractive valuation and an appropriate capital structure with prudent use of leverage Sufficient scale to be public markets-ready, yet committed to retaining the rigorous operational growth and operating cost framework developed in the private markets Able to benefit from public company status to access broader capital markets or pursue M&A Attractive risk-adjusted return for our shareholders These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials that we would file with the SEC. Our Acquisition Process In evaluating a prospective target business, we expect to conduct an extensive due diligence review which may encompass, as applicable and among other things, meetings with the incumbent management team and employees, document reviews, interviews of customers and suppliers, inspection of facilities and a review of financial and other information about the target and its industry. We will also utilize our management team s operational and capital planning experience. Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended (the Table of Contents Exchange Act ). As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our business combination. Initial Business Combination So long as our securities are then listed on Nasdaq, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the net assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of signing a definitive agreement in connection with our initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or an independent valuation or appraisal firm with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of a target business or businesses, it may be unable to do so if the board of directors is less familiar or experienced with the target company s business, there is a significant amount of uncertainty as to the value of the company s assets or prospects, including if such company is at an early stage of development, operations or growth, or if the anticipated transaction involves a complex financial analysis or other specialized skills and the board of directors determines that outside expertise would be helpful or necessary in conducting such analysis. Since any opinion, if obtained, would merely state that the fair market value of the target business meets the 80% of net assets threshold, unless such opinion includes material information regarding the valuation of a target business or the consideration to be provided, it is not anticipated that copies of such opinion would be distributed to our shareholders. However, if required under applicable law, any proxy statement that we deliver to shareholders and file with the SEC in connection with a proposed transaction will include such opinion. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination so that the post-business combination company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-business combination company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-business combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-business combination company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-business combination company, depending on valuations ascribed to the target and us in the business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-business combination company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. In addition, we have agreed not to enter into a definitive agreement regarding an initial business combination without the prior consent of our sponsor. If our securities are not then listed on Nasdaq for whatever reason, we would no longer be required to meet the foregoing 80% of net asset test. Table of Contents To the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management team will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors. The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the funds we can use to complete another business combination. Other Considerations We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors, or a portfolio company of Sound Point or its affiliates or making the acquisition through a joint venture or other form of shared ownership with such parties. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor or any of our officers or directors, we, or a committee of independent and disinterested directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions that such initial business combination is fair to our company from a financial point of view. We currently do not have any specific business combination under consideration. Our officers and directors have neither individually selected nor considered a target business nor have they had any substantive discussions regarding possible target businesses among themselves or with our underwriters or other advisors. Our management team is regularly made aware of potential business opportunities, one or more of which we may desire to pursue for a business combination, but we have not (nor has anyone on our behalf) contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to a business combination transaction with our company. Additionally, we have not, nor has anyone on our behalf, taken any substantive measure, directly or indirectly, to identify or locate any suitable business combination candidate for us, nor have we engaged or retained any agent or other representative to identify or locate any such business combination candidate. Our officers and directors have, and any of them in the future may have fiduciary and contractual duties to other entities, including Sound Point, its affiliates and companies Sound Point has invested in or managed. In addition, Sound Point manages several investment vehicles and expects to raise additional funds or accounts in the future, including during the period in which we are seeking our initial business combination. These investment vehicles managed by Sound Point or its affiliates may compete with us for acquisition opportunities. If these funds decide to pursue any such opportunity, we may be precluded from pursuing such opportunities. In addition, investment ideas generated within Sound Point may be suitable for both us and for a current or future Sound Point fund and may be directed to such investment vehicle rather than to us. Neither Sound Point nor members of our management team who are also employed by certain affiliates of Sound Point have any obligation to present us with any business combination target of which they become aware. As a result, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, then, subject to their fiduciary duties under Cayman Islands law, he or she may be required to honor such fiduciary or contractual obligations to present such business combination opportunity to such entity, before we can pursue such opportunity. If these other entities decide to pursue any such opportunity, we may be precluded from pursuing the same However, we do not expect these duties to materially affect our ability to complete our initial business combination. Our amended and restated memorandum and articles of association provides that to the fullest Table of Contents extent permitted by applicable law: (i) no individual service as a director or an officer shall have any duty, except to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer or sponsor or another entity, on the one hand, and us, on the other. In addition, our amended and restated memorandum and articles of association will contain provisions to exculpate and indemnify, to the maximum extent permitted by law, such persons in respect of any liability, obligation or duty to our company that may arise as a consequence of such persons becoming aware of any business opportunity or failing to present such business opportunity. Our directors and the members of our management team may directly or indirectly own our founder shares, Class A ordinary shares and/or private placement warrants following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. In particular, because the founder shares were purchased at approximately $0.004 per share (after giving effect to the surrender of founder shares described herein), the holders of our founder shares (including certain of our directors and members of our management team that directly or indirectly own founder shares) could make a substantial profit after our initial business combination even if our public shareholders lose money on their investment as a result of a decrease in the post-combination value of their ordinary shares (after accounting for any adjustments in connection with an exchange or other transaction contemplated by the business combination). Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors were to be included by a target business as a condition to any agreement with respect to our initial business combination. We may, at our option, pursue an acquisition opportunity jointly with Sound Point, one or more parties affiliated with Sound Point, including without limitation, officers and affiliates of Sound Point or Sound Point funds, or investors in such Sound Point funds, or another entity affiliated with one of our directors. Any such party may co-invest with us in the target business at the time of our initial business combination, or we could raise additional proceeds to complete the acquisition by borrowing from or issuing to such parties a class of equity or debt securities. The amount and other terms and conditions of any such joint acquisition or specified future issuance would be determined at the time thereof. For more information, see the section entitled Management Conflicts of Interest. Our sponsor, officers and directors may sponsor, form or participate in other blank check companies similar to ours during the period in which we are seeking an initial business combination. Any such companies may present additional conflicts of interest in pursuing a business combination target, particularly in the event there is overlap among investment mandates. However, we do not currently expect that any such other blank check company would materially affect our ability to complete our initial business combination. In addition, our officers and directors are not required to, and will not, commit their full time to our affairs, which may result in a conflict of interest in allocating their time between our operations and our search for our initial business combination and their other businesses. We do not intend to have any full-time employees prior to the completion of our initial business combination. Our officers and the members of Sound Point s investment team are engaged in other business endeavors for which they may be entitled to substantial compensation and our officers are not obligated to contribute any specific number of hours per week to our affairs. Our directors and independent director nominees also serve as officers or board members for other entities. If such persons other business affairs require them to devote substantial amounts of time to such affairs in excess of their current commitment levels, it could limit their ability to devote time to our affairs which may have a negative impact on our ability to complete our initial business combination. Table of Contents Corporate Information Our executive offices are located at 375 Park Avenue, New York, New York 10152, and our telephone number is (212) 895-2280. We expect to maintain a corporate website at . The information contained on or accessible through our corporate website or any other website that we may maintain is not part of this prospectus or the registration statement of which this prospectus is a part. We are a Cayman Islands exempted company. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received, a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 20 years from May 7, 2021, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that are held by non-affiliates equals or exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. References herein to emerging growth company have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates equals or exceeds $250 million as of the prior June 30, and (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year or the market value of our ordinary shares held by non-affiliates equals or exceeds $700 million as of the prior June 30. Table of Contents The Offering In deciding whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors of this prospectus. Securities offered 20,000,000 units (or 23,000,000 units if the underwriters over-allotment option is exercised in full), at $10.00 per unit, each unit consisting of: one Class A ordinary share; and one-half of one redeemable warrant. Proposed Nasdaq symbols Units: SPCMU Class A ordinary shares: SPCM Warrants: SPCMW Trading commencement and separation of Class A ordinary shares and warrants The units are expected to begin trading on or promptly after the date of this prospectus. The Class A ordinary shares and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless BofA Securities, Inc. and J.P. Morgan Securities LLC inform us of their decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the Class A ordinary shares and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into Class A ordinary shares and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Additionally, the units will automatically separate into their component parts and will not be traded after completion of our initial business combination. Separate trading of the Class A ordinary shares and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A ordinary shares and warrants be traded separately until we have filed with the SEC a Current Report on Table of Contents Form 8-K which includes an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. Units: Number outstanding before this offering 0 Number outstanding after this offering 20,000,000(1) Ordinary shares: Number outstanding before this offering 5,750,000(2)(3) Number outstanding after this offering 25,000,000(1)(2)(4) Warrants: Number of private placement warrants to be sold in a private placement simultaneously with this offering 12,500,000(1) Number of warrants to be outstanding after this offering and the sale of private placement warrants 22,500,000(1) Exercisability Each whole warrant is exercisable to purchase one Class A ordinary share, subject to adjustment as described herein. Only whole warrants are exercisable. We structured each unit to contain one-half of one redeemable warrant, with each whole warrant exercisable for one Class A ordinary share, as compared to units issued by some other similar blank check companies which contain whole warrants exercisable for one whole share, in order to reduce the dilutive effect of the warrants upon completion of our initial business combination as compared to units that each contain a whole warrant to purchase one whole share, thus making us, we believe, a more attractive business combination partner for target businesses. Table of Contents Exercise price $11.50 per whole share, subject to adjustments as described herein. In addition, if (x) we issue additional Class A ordinary shares or equity-linked securities for capital raising purposes (other than any forward purchase shares) in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per ordinary share (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or such affiliates, as applicable, prior to such issuance) (the Newly Issued Price ), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our Class A ordinary shares during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the Market Value ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, the $18.00 per share redemption trigger price described adjacent to Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00 and Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00 will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price, and the $10.00 per share redemption trigger price described adjacent to the caption Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00 will be adjusted (to the nearest cent) to be equal to the higher of the Market Value and the Newly Issued Price. (1) Assumes no exercise of the underwriters over-allotment option and the corresponding forfeiture of 750,000 founder shares. (2) Founder shares are currently classified as Class B ordinary shares, which shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described below adjacent to the caption Founder shares conversion and anti-dilution rights and in our amended and restated memorandum and articles of association. Such Class A ordinary shares delivered upon conversion will not have any redemption rights or be entitled to liquidating distributions from the trust account if we do not consummate an initial business combination. (3) Includes 750,000 founder shares that are subject to forfeiture. (4) Includes 20,000,000 public shares and 5,000,000 founder shares, assuming 750,000 founder shares have been forfeited. Exercise period The warrants will become exercisable 30 days after the completion of our initial business combination; provided that we have an effective registration statement under the Securities Act covering the Class A ordinary shares issuable upon exercise of the warrants and a current prospectus relating to them is available and such shares are registered, qualified or exempt from registration under the securities, or blue sky, Table of Contents laws of the state of residence of the holder (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement, including as a result of a notice of redemption described below under Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00 ). If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. We have agreed that as soon as practicable, but in no event later than twenty business days after the closing of our initial business combination, we will use our commercially reasonable efforts to file with the SEC a post-effective amendment to the registration statement of which this prospectus forms a part or a new registration statement covering the Class A ordinary shares issuable upon exercise of the warrants, and we will use our commercially reasonable efforts to cause the same to become effective within 60 business days after the closing of our initial business combination, and to maintain the effectiveness of such registration statement and a current prospectus relating to those Class A ordinary shares until the warrants expire or are redeemed, as specified in the warrant agreement provided that if our Class A ordinary shares are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement. If a registration statement covering the Class A ordinary shares issuable upon exercise of the warrants is not effective by the 60th day after the closing of the initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption, but we will use our commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Table of Contents Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00 Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the private placement warrants): in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period ; and if, and only if, the last reported sale price (the closing price ) of our Class A ordinary shares equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading Description of Securities Warrants Public Shareholders Warrants Anti-Dilution Adjustments ) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. We will not redeem the warrants as described above unless an effective registration statement under the Securities Act covering the Class A ordinary shares issuable upon exercise of the warrants is effective and a current prospectus relating to those Class A ordinary shares is available throughout the 30-day redemption period. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. Except as set forth below, none of the private placement warrants will be redeemable by us so long as they are held by our sponsor or its permitted transferees. Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00 Once the warrants become exercisable, we may redeem the outstanding warrants: in whole and not in part; at $0.10 per warrant upon a minimum of 30 days prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to the table set forth under Description of Securities Warrants Public Shareholders Warrants based on the redemption date and the fair market value of our Class A ordinary shares (as defined below) except as otherwise described in Description of Securities Warrants Public Shareholders Warrants ; Table of Contents if, and only if, the closing price of our Class A ordinary shares equals or exceeds $10.00 per public share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading Description of Securities Warrants Public Shareholders Warrants Anti-Dilution Adjustments ) for any 20 trading days within the 30-trading day period ending three trading days before we send the notice of redemption to the warrant holders; and if the closing price of the Class A ordinary shares for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders is less than $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading Description of Securities Warrants Public Shareholders Warrants Anti-dilution Adjustments ), the private placement warrants must also be concurrently called for redemption on the same terms as the outstanding public warrants, as described above. The fair market value of our Class A ordinary shares for the above purpose shall mean the volume weighted average price of our Class A ordinary shares during the ten trading days immediately following the date on which the notice of redemption is sent to the holders of warrants. This redemption feature differs from the typical warrant redemption features used in other blank check offerings. We will provide our warrant holders with the final fair market value no later than one business day after the ten trading day period described above ends. In no event will the warrants be exercisable in connection with this redemption feature for more than 0.361 Class A ordinary shares per warrant (subject to adjustment). No fractional Class A ordinary shares will be issued upon redemption. If, upon redemption, a holder would be entitled to receive a fractional interest in a share, we will round down to the nearest whole number of the number of Class A ordinary shares to be issued to the holder. Please see the section entitled Description of Securities Warrants Public Shareholders Warrants for additional information. Accounting for the public warrants and private placement warrants The public warrants that are to be issued in this offering and the private placement warrants that are to be issued concurrently with this offering will be accounted for outside of shareholders equity and included in our financial statements as a current liability measured at the estimated fair value of the total outstanding public and private placement warrants. In addition, at each reporting period (1) the accounting treatment of the warrants will be re-evaluated for proper accounting treatment as a liability or equity and (2) the fair value of Table of Contents the liability of the public and private placement warrants will be remeasured and the change in the fair value of the liability will be recorded as other income (expense) in our income statement. Forward Purchase Agreement In connection with the consummation of this offering, we will enter into a forward purchase agreement with the forward purchaser (an affiliate of our sponsor), pursuant to which the forward purchaser will commit to purchase from us $50.0 million of forward purchase shares, at a price of $10.00 per share as described in the forward purchase agreement, in a private placement that will close concurrently with the closing of our initial business combination. The proceeds from the sale of these forward purchase shares, together with the amounts available to us from the trust account (after giving effect to any redemptions of public shares) and any other equity or debt financing obtained by us in connection with the business combination, will be used to satisfy the cash requirements of the business combination, including funding the purchase price, paying expenses and retaining specified amounts to be used by the post-business combination company for working capital or other purposes. The forward purchase shares will be identical to the Class A ordinary shares included in the units being sold in this offering, except that they will not be transferable, assignable or salable during the lock-up period described herein under Principal Shareholders Transfers of Founder Shares, Private Placement Warrants and Forward Purchase Shares, and will be subject to registration rights. At our option the forward purchaser may purchase less forward purchase shares in accordance with the terms of the forward purchase agreement. In addition, the forward purchaser s commitment under the forward purchase agreement will be subject to approval, prior to our entering into a definitive agreement for our initial business combination, of the forward purchaser s investment committee. Founder shares In May 2021, our sponsor paid $25,000, or approximately $0.003 per share, for 8,625,000 Class B ordinary shares, par value $0.0001. In January 2022, our sponsor transferred 25,000 founder shares to each of our independent director nominees at their original purchase price. In January 2022, our sponsor surrendered 2,875,000 founder shares to us for no consideration, resulting in an aggregate of 5,750,000 founder shares outstanding (up to 750,000 founder shares are subject to forfeiture by our sponsor, depending on the extent to which the underwriters over-allotment option is exercised). As a result of such surrender, the effective per-share purchase price increased to approximately $0.004 per share. The per-share price of the founder shares was determined by dividing the $25,000 paid by our sponsor to the company by the aggregate number of founder shares issued. If we increase or decrease the size of this offering, we will effect a share capitalization or a share surrender or redemption or other appropriate mechanism, as applicable, with respect to our Class B ordinary shares immediately prior to the consummation of this offering in such amount as to maintain the number of founder shares, on an Table of Contents as-converted basis, at 20% of our issued and outstanding ordinary shares upon the consummation of this offering. The founder shares are identical to the Class A ordinary shares included in the units being sold in this offering, except that: prior to our initial business combination, only holders of the founder shares have the right to vote on the election of directors and holders of a majority of our founder shares may remove a member of the board of directors for any reason; the founder shares are subject to certain transfer restrictions, as described in more detail below; our sponsor and each member of our management team have entered into an agreement with us, pursuant to which they have agreed to (i) waive their redemption rights with respect to their founder shares, (ii) to waive their redemption rights with respect to their founder shares and public shares in connection with a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus) or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares or pre-initial business combination activity and (iii) waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to consummate an initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus) (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). If we seek shareholder approval, we will complete our initial business combination only if we obtain the approval of an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the Company. In such case, our sponsor and each member of our management team have agreed to vote their founder shares and public shares in favor of our initial business combination. As a result, in addition to our initial shareholders founder shares, we would need 7,500,001, or 37.5% (assuming all issued and outstanding shares are voted and the over-allotment option is not exercised), or 1,250,001, or 6.25% (assuming only the minimum number of shares representing a Table of Contents quorum are voted and the over-allotment option is not exercised), of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved; with respect to any vote or votes to continue the company in a jurisdiction outside the Cayman Islands in accordance with the amended and restated memorandum and articles of association (including, but not limited to, the approval of the organizational documents of the company in such other jurisdiction), holders of Class B ordinary shares will have ten votes for every Class B ordinary share and holders of Class A ordinary shares will have one vote for every Class A ordinary share; the founder shares will automatically convert into our Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described below adjacent to the caption Founder shares conversion and anti-dilution rights and in our amended and restated memorandum and articles of association; and the founder shares are entitled to registration rights. Transfer restrictions on founder shares and forward purchase shares Except as described herein, our sponsor, the forward purchaser and our directors and executive officers have agreed not to transfer, assign or sell any of their founder shares or forward purchase shares until the earliest of (A) one year after the completion of our initial business combination and (B) subsequent to our initial business combination, (x) if the closing price of our Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, or (y) the date on which we complete a liquidation, merger, share exchange or other similar transaction that results in all of our public shareholders having the right to exchange their ordinary shares for cash, securities or other property. Any permitted transferees would be subject to the same restrictions and other agreements of our sponsor, the forward purchaser and our directors and executive officers with respect to any founder shares and forward purchase shares. Founder shares conversion and anti-dilution rights The founder shares are designated as Class B ordinary shares and will automatically convert into Class A ordinary shares, which such Class A ordinary shares delivered upon conversion will not have any redemption rights or be entitled to liquidating distributions if we do not consummate an initial business combination, at the time of our initial business combination or earlier at the option of the holders thereof at a ratio such that the number of Class A ordinary shares Table of Contents issuable upon conversion of all founder shares will equal, in the aggregate, on an as-converted basis, 20% of the sum of (i) the total number of ordinary shares issued and outstanding upon completion of this offering, plus (ii) the total number of Class A ordinary shares issued or deemed issued or issuable upon conversion or exercise of any equity-linked securities (as defined herein) or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of the initial business combination, including any forward purchase shares, but excluding any Class A ordinary shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued, deemed issued, or to be issued, to any seller in the initial business combination and any private placement warrants issued to our sponsor, its affiliates or any member of our management team upon conversion of working capital or extension loans. Any conversion of Class B ordinary shares described herein will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. In no event will the Class B ordinary shares convert into Class A ordinary shares at a rate of less than one-to-one. Election of directors; Voting rights Prior to the completion of our initial business combination, only holders of our founder shares will have the right to vote on the election of directors. Holders of our public shares will not be entitled to vote on the election of directors during such time. In addition, prior to the completion of an initial business combination, holders of a majority of our founder shares may remove a member of the board of directors for any reason. These provisions of our amended and restated memorandum and articles of association may only be amended by a special resolution passed by not less than two-thirds of our ordinary shares who attend and vote at our general meeting which shall include the affirmative vote of a simple majority of our Class B ordinary shares. With respect to any other matter submitted to a vote of our shareholders, including any vote in connection with our initial business combination, except as required by law, holders of our founder shares and holders of our public shares will vote together as a single class, with each share entitling the holder to one vote. In connection with our initial business combination, we may enter into a shareholders agreements or other arrangements with the shareholders of the target with respect to voting or other corporate governance matters following completion of the initial business combination. Private placement warrants Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 12,500,000 private placement warrants (or 14,000,000 private placement warrants if the underwriters over-allotment option is exercised in full), each exercisable to purchase one Class A ordinary share at $11.50 per share, subject to adjustment, at a price of $1.00 per warrant ($12,500,000 in the aggregate or $14,000,000 if the underwriters over-allotment option is exercised in Table of Contents full), in a private placement that will close simultaneously with the closing of this offering. If we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus), the private placement warrants will expire worthless. The private placement warrants will be non-redeemable by us (except as set forth under Description of Securities Warrants Public Shareholders Warrants Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00 ) and exercisable on a cashless basis so long as they are held by our sponsor or its permitted transferees (see Description of Securities Warrants Private Placement Warrants ). If the private placement warrants are held by holders other than our sponsor or its permitted transferees, the private placement warrants will be redeemable by us in all redemption scenarios and exercisable by the holders on the same basis as the warrants included in the units being sold in this offering. Transfer restrictions on private placement warrants The private placement warrants (including the Class A ordinary shares issuable upon exercise of the private placement warrants) will not be transferable, assignable or salable until 30 days after the completion of our initial business combination, except as described herein under Principal Shareholders Transfers of Founder Shares, Private Placement Warrants and Forward Purchase Shares. Cashless exercise of private placement warrants If holders of private placement warrants elect to exercise them on a cashless basis, except as described under Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00, they would pay the exercise price by surrendering their warrants for that number of Class A ordinary shares equal to the quotient obtained by dividing (x) the product of the number of Class A ordinary shares underlying the warrants, multiplied by the excess of the Sponsor fair market value (defined below) over the exercise price of the warrants by (y) the Sponsor fair market value. The Sponsor fair market value shall mean the average reported closing price of the Class A ordinary shares for the ten trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent. The reason that we have agreed that these warrants will be exercisable on a cashless basis so long as they are held by the sponsor or its permitted transferees is because it is not known at this time whether they will be affiliated with us following a business combination. If they remain affiliated with us, their ability to sell our securities in the open market will be significantly limited. We expect to have policies in place that restrict insiders from selling our securities except during specific periods. Proceeds to be held in trust account Of the proceeds we will receive from this offering and the sale of the private placement warrants described in this prospectus, Table of Contents $206,000,000, or $236,900,000 if the underwriters over-allotment option is exercised in full ($10.30 per unit in either case), will be deposited into a segregated trust account located in the United States with Continental Stock Transfer & Trust Company acting as trustee. The proceeds to be placed in the trust account include $7,000,000 (or $8,050,000 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our income taxes, if any, our amended and restated memorandum and articles of association, as discussed below and subject to the requirements of law and regulation, will provide that the proceeds from this offering and the sale of the private placement warrants held in the trust account will not be released from the trust account (1) to us, until the completion of our initial business combination, or (2) to our public shareholders, until the earliest of (a) the completion of our initial business combination, and then only in connection with those Class A ordinary shares that such shareholders properly elected to redeem, subject to the limitations described herein, (b) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus) or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares, or pre-initial business combination activity and (c) the redemption of our public shares if we have not consummated our business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus), subject to applicable law. Public shareholders who redeem their Class A ordinary shares in connection with a shareholder vote described in clause (b) in the preceding sentence shall not be entitled to funds from the trust account upon the subsequent completion of an initial business combination or liquidation if we have not consummated an initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus), with respect to such Class A ordinary shares so redeemed. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. In addition, if we extend the time available for us to consummate our initial business combination, we, upon five days advance notice prior Table of Contents to the applicable deadline, must deposit into the trust account for each three month extension (of which there may be no more than two such extensions) $2,000,000, or $2,300,000 if the underwriters over-allotment option is exercised in full ($0.10 per share in either case), on or prior to the date of the applicable deadline. See The Offering Redemption of public shares and distribution and liquidation if no initial business combination for a description of how we may extend the time available for us to consummate our initial business combination. Anticipated expenses and funding sources Except as described above with respect to the payment of taxes, if the funds held in the trust account are held in an interest-bearing account in the future, unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. Immediately following the completion of this offering, the proceeds will not be invested and will be held in a non-interest bearing trust account. If, in the future, the proceeds held in the trust account are invested, then the proceeds will be invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. Assuming an interest rate of 0.01% per year, we estimate the interest earned on the trust account will be approximately $20,600 per year; however, we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement warrants not held in the trust account, which will be approximately $1,000,000 in working capital after the payment of approximately $1,500,000 in non-reimbursed expenses relating to this offering; and any loans or additional investments from our sponsor or an affiliate of our sponsor or certain of our officers and directors, although they are under no obligation to advance funds to us in such circumstances, and provided any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of our initial business combination. Conditions to completing our initial business combination So long as our securities are then listed on Nasdaq, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the net assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of signing a definitive agreement in connection with our initial business combination. If our board of directors is not able to independently determine the fair market value Table of Contents of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. Our shareholders may not be provided with a copy of such opinion nor will they be able to rely on such opinion. If our securities are not then listed on Nasdaq for whatever reason, we would no longer be required to meet the foregoing 80% of net asset test. We will complete our initial business combination only if the post-business combination company in which our public shareholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or is otherwise not required to register as an investment company under the Investment Company Act. Even if the post-business combination company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post-business combination company, depending on valuations ascribed to the target and us in the business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-business combination company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test, provided that in the event that the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking shareholder approval, as applicable. Permitted purchases and other transactions with respect to our securities If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, executive officers, advisors or their affiliates may purchase public shares or public warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Additionally, at any time at or prior to our initial business combination, subject to applicable securities laws (including with respect to material nonpublic information), our sponsor, directors, executive officers, advisors or their affiliates may enter into transactions with investors and others to provide them with incentives to acquire public shares, vote their public shares in favor of our initial business combination or not redeem their public shares. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds held in the trust account will be used to purchase public shares or public warrants in such transactions. If they engage in such transactions, they will be Table of Contents restricted from making any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Securities Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. See Proposed Business Permitted Purchases and Other Transactions with Respect to Our Securities for a description of how our sponsor, directors, executive officers, advisors or their affiliates will select which shareholders to purchase securities from in any private transaction. The purpose of any such transaction could be to (1) vote in favor of the business combination and thereby increase the likelihood of obtaining shareholder approval of the business combination, (2) reduce the number of public warrants outstanding or vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination or (3) satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our Class A ordinary shares or public warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Redemption rights for public shareholders upon completion of our initial business combination We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of the initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our income taxes, if any, divided by the number of then-outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.30 per public share, which amount may be increased by up to $0.20 per unit sold in this offering in the event we decide to extend the time to consummate our business combination by six months (as Table of Contents described in this prospectus). The per share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. The redemption rights will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Further, we will not proceed with redeeming our public shares, even if a public shareholder has properly elected to redeem its shares, if a business combination does not close. Our sponsor and each member of our management team have entered into an agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and public shares held by them in connection with (i) the completion of our initial business combination and (ii) a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus) or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares or pre-initial business combination activity. Limitations on redemptions Our amended and restated memorandum and articles of association will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets, after payment of deferred underwriting commissions, to be less than $5,000,001 (so that we do not then become subject to the SEC s penny stock rules). However, a greater net tangible asset or cash requirement may be contained in the agreement relating to our initial business combination. For example, the proposed business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. Furthermore, although we will not redeem shares in an amount that would cause our net tangible assets, after payment of deferred underwriting commissions, to fall below $5,000,001, we do not have a maximum redemption threshold based on the percentage of shares sold in this offering, as many blank check companies do. In the event the aggregate cash consideration we would be required to pay for all Class A ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all Class A ordinary shares submitted for redemption will be returned Table of Contents to the holders thereof, and we instead may search for an alternate business combination. Manner of conducting redemptions We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a general meeting called to approve the business combination or (ii) by means of a tender offer. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under applicable law or stock exchange listing requirement. Asset acquisitions and share purchases would not typically require shareholder approval, while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding ordinary shares or seek to amend our amended and restated memorandum and articles of association would typically require shareholder approval. We currently intend to conduct redemptions in connection with a shareholder vote unless shareholder approval is not required by applicable law or stock exchange listing requirement or we choose to conduct redemptions pursuant to the tender offer rules of the SEC for business or other reasons. If we hold a shareholder vote to approve our initial business combination, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and file proxy materials with the SEC. If we seek shareholder approval, we will complete our initial business combination only if we obtain the approval of an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the Company. In such case, our sponsor and each member of our management team have agreed to vote their founder shares and public shares in favor of our initial business combination. As a result, in addition to our initial shareholders founder shares, we would need 7,500,001, or 37.5% (assuming all issued and outstanding shares are voted and the over-allotment option is not exercised), or 1,250,001, or 6.25% (assuming only the minimum number of shares representing a quorum are voted and the over-allotment option is not exercised), of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved. Each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction or vote at all. Our amended and restated Table of Contents memorandum and articles of association will require that at least five days notice will be given of any such general meeting. If we conduct redemptions pursuant to the tender offer rules of the SEC, we will, pursuant to our amended and restated memorandum and articles of association: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we and our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase our Class A ordinary shares in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least twenty business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering more than the number of public shares we are permitted to redeem. If public shareholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete such initial business combination. Limitation on redemption rights of shareholders holding more than 15% of the shares sold in this offering if we hold shareholder vote Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. We believe the restriction described above will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem Table of Contents their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us, our sponsor or our management at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be disbursed directly by the trustee to pay amounts due to any public shareholders who properly exercise their redemption rights as described above adjacent to the caption Redemption rights for public shareholders upon completion of our initial business combination, to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or the redemption of our public shares, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our amended and restated memorandum and articles of association will provide that we will have only 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus) to consummate our initial business combination. If we have not consummated an initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a Table of Contents business combination as described in this prospectus), we will: (i) cease all operations except for the purpose of winding up; (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our income taxes, if any (less up to $100,000 of interest to pay dissolution expenses) divided by the number of the then-outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any); and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in each case, to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to consummate an initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus). If we anticipate that we may not be able to consummate an initial business combination within 15 months, we may, but are not obligated to, extend the period of time to consummate an initial business combination by an additional three months on two separate occasions (after the exercise of all extensions, we will have a total of up to 21 months to complete an initial business combination). Pursuant to the terms of our amended and restated memorandum and articles of association and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order to extend the time available for us to consummate our initial business combination, we, upon five days advance notice prior to the applicable deadline, must deposit into the trust account for each three month extension (of which there may be no more than two such extensions) $2,000,000, or $2,300,000 if the underwriters over-allotment option is exercised in full ($0.10 per share in either case), on or prior to the date of the applicable deadline. Our public shareholders will not be offered the opportunity to vote on or redeem their shares in connection with any such extension. However, our shareholders will be entitled to vote and redeem their shares in connection with a shareholder meeting held to approve an initial business combination or in a tender offer undertaken in connection with an initial business combination if we propose such a business combination during any three-month extension period. Any such extension payments would be funded from the proceeds of a non-interest bearing loan from our sponsor to us. The terms in connection with such loans have not been negotiated and will only be finally determined at the time of entry into such loans. If we complete our initial business combination, we expect that we would repay such Table of Contents loaned amounts in cash out of the proceeds of the trust account released to us, or, at the discretion of our sponsor, such loan will be satisfied by the issuance of private placement warrants at a price per warrant of $1.00. The warrants would be identical to the private placement warrants issued to our sponsor concurrently with the consummation of this offering. If we do not complete a business combination, we will repay such loans only from funds held outside of the trust account (unless sooner converted to private placement warrants at the election of our sponsor). In the event that we determine to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the applicable deadline announcing whether or not the funds had been timely deposited. Our sponsor and their affiliates or designees are not obligated to enter into any such loan agreement with us that would allow us to fund the trust account to extend the time for us to complete our initial business combination. Furthermore, the ultimate terms of such loans may be unfavorable, or unacceptable, to us. Our sponsor and each member of our management team have entered into an agreement with us, pursuant to which they have agreed to waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to consummate an initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus) (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). The underwriters have agreed to waive their rights to their deferred underwriting commission held in the trust account in the event we do not consummate an initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus) and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. Our sponsor, executive officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months from the closing of this offering (or up to 21 months, if we extend the time to complete a business combination as described in this prospectus) or (B) with respect to any other provision relating to the rights of holders Table of Contents of our Class A ordinary shares or pre-initial business combination activity; unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our income taxes, if any, divided by the number of the then-outstanding public shares, subject to the limitations described above adjacent to the caption Limitations on redemptions. For example, our board of directors may propose such an amendment if it determines that additional time is necessary to complete our initial business combination. In such event, we will conduct a proxy solicitation and distribute proxy materials pursuant to Regulation 14A of the Exchange Act seeking shareholder approval of such proposal and, in connection therewith, provide our public shareholders with the redemption rights described above upon shareholder approval of such amendment. This redemption right shall apply in the event of the approval of any such amendment, whether proposed by our sponsor, any executive officer or director, or any other person. Our amended and restated memorandum and articles of association will provide that, if we wind up for any other reason prior to the consummation of our initial business combination, we will follow the foregoing procedures with respect to the liquidation of the trust account as promptly as reasonably possible but not more than ten business days thereafter, subject to applicable Cayman Islands law. Limited payments to insiders There will be no finder s fees, reimbursements or cash payments made by the company to our sponsor, officers or directors, or their affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination, other than the following payments, none of which will be made from the proceeds of this offering and the sale of the private placement warrants held in the trust account prior to the completion of our initial business combination: Repayment of up to an aggregate of $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; Reimbursement for office space, secretarial and administrative services provided to us by an affiliate of our sponsor, in the amount of $10,000 per month; Underwriting discounts and commissions paid to SPC Capital Markets LLC; Reimbursement for any out-of-pocket expenses related to identifying, investigating, negotiating and completing an initial business combination; Table of Contents Repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination. Up to $1,500,000 of such loans may be convertible into warrants of the post-business combination entity at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants. Except for the foregoing, the terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans; and Repayment of extension loans which may be made by our sponsor or an affiliate or designee of our sponsor in an amount up to $4,600,000 if we extend the period of time to consummate a business combination by up to an additional six months as described in this prospectus. The terms in connection with such loans have not been negotiated and will only be finally determined at the time of entry into such loans. If we complete our initial business combination, we expect that we would repay such loaned amounts in cash out of the proceeds of the trust account released to us, or, at the discretion of our sponsor, such loans will be satisfied by the issuance of private placement warrants at a price per warrant of $1.00. The warrants would be identical to the private placement warrants issued to our sponsor concurrently with the consummation of this offering. If we do not complete a business combination, we will repay such loans only from funds held outside of the trust account (unless sooner converted to private placement warrants at the election of our sponsor). Any such payments will be made either (i) prior to our initial business combination using proceeds of this offering and the sale of the private placement warrants held outside the trust account or from loans made to us by our sponsor or an affiliate of our sponsor or certain of our officers and directors or (ii) in connection with or after the consummation of our initial business combination. Audit Committee We will establish and maintain an audit committee, which will be composed entirely of independent directors. Among its responsibilities, the audit committee will review on a quarterly basis all payments that were made by us to our sponsor, officers or directors, or their affiliates and monitor compliance with the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to promptly take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled Management Committees of the Board of Directors Audit Committee. Conflicts of Interest Our officers and directors have, and any of them in the future may have fiduciary and contractual duties to other entities, including Sound Point, its affiliates and companies Sound Point has invested in or managed. In addition, Sound Point manages several investment Table of Contents vehicles and expects to raise additional funds or accounts in the future, including during the period in which we are seeking our initial business combination. These investment vehicles managed by Sound Point or its affiliates may compete with us for acquisition opportunities. If these funds decide to pursue any such opportunity, we may be precluded from pursuing such opportunities. In addition, investment ideas generated within Sound Point may be suitable for both us and for a current or future Sound Point fund and may be directed to such investment vehicle rather than to us. Neither Sound Point nor members of our management team who are also employed by certain affiliates of Sound Point have any obligation to present us with any business combination target of which they become aware. As a result, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, then, subject to their fiduciary duties under Cayman Islands law he or she may be required to honor such fiduciary or contractual obligations to present such business combination opportunity to such entity, before we can pursue such opportunity. If these other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. However, we do not expect these duties to materially affect our ability to complete our initial business combination. Our amended and restated memorandum and articles of association provides that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and us, on the other. In addition, our amended and restated memorandum and articles of association will contain provisions to exculpate and indemnify, to the maximum extent permitted by law, such persons in respect of any liability, obligation or duty to our company that may arise as a consequence of such persons becoming aware of any business opportunity or failing to present such business opportunity. Our directors and the members of our management team and our directors may directly or indirectly own our founder shares, Class A ordinary shares and/or private placement warrants following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. In particular, because the founder shares were purchased at approximately $0.004 per share (after giving effect to the surrender of founder shares described herein), the holders of our founder shares (including certain of our directors and members of our management team that directly or indirectly own founder shares) could make a substantial profit after our initial business combination even if our Table of Contents public shareholders lose money on their investment as a result of a decrease in the post-combination value of their ordinary shares (after accounting for any adjustments in connection with an exchange or other transaction contemplated by the business combination). Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors were to be included by a target business as a condition to any agreement with respect to our initial business combination. For more information, see the section entitled Management Conflicts of Interest. Underwriting Conflict of Interest Because SPC Capital Markets LLC is indirectly owned by certain individuals who also have an economic interest in Sound Point, SPC Capital Markets LLC is deemed to have a conflict of interest under Rule 5121 of the Financial Industry Regulatory Authority ( Rule 5121 ). Rule 5121 prohibits SPC Capital Markets LLC from making sales to discretionary accounts without the prior written approval of the account holder and requires that a qualified independent underwriter, as defined in Rule 5121, participate in the preparation of the registration statement and exercise its usual standards of due diligence with respect thereto. Each of BofA Securities, Inc. and J.P. Morgan Securities LLC is acting as a qualified independent underwriter for this offering. Please see Underwriting Conflict of Interest for more information. Table of Contents
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: we, us, our, company or our company are to AIB Acquisition Corporation, a Cayman Islands exempted company; amended and restated memorandum and articles of association are to our memorandum and articles of association in effect upon completion of this offering; Class A ordinary shares are to our Class A ordinary shares, par value $0.0001 per share; Class B ordinary shares are to our Class B ordinary shares, par value $0.0001 per share; Companies Act are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; directors are to our current directors and director nominees; founder shares are to our Class B ordinary shares initially purchased by our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination (for the avoidance of doubt, such Class A ordinary shares will not be public shares ); initial shareholders are to our sponsor and other holders of our founder shares prior to this offering; letter agreement refers to the letter agreement entered into between us and our initial shareholders, directors and officers on or prior to the date of this prospectus, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team are to our officers and directors and any other advisors described in the Management section of this prospectus; Maxim are to Maxim Group LLC, the representative of the underwriters in this offering; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private rights are to the rights underlying the private units; private shares are to the Class A ordinary shares underlying the private units; private units are to the units issued to our sponsor in a private placement simultaneously with the closing of this offering; public rights or rights are to our rights sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shares are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders are to the holders of our public shares, including our sponsor, officers and directors to the extent our sponsor, officers or directors purchase public shares, provided their status as a public shareholder shall only exist with respect to such public shares; sponsor are to AIB LLC, a Delaware limited liability company; and $, US$ and U.S. dollar each refer to the United States dollar. 1 Table of Contents Any conversion of the Class B ordinary shares described in this prospectus will take effect as a redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. All references in this prospectus to shares of the Company being forfeited shall take effect as surrenders for no consideration of such shares as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as a share capitalization as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise the over-allotment option and the resulting forfeiture by our sponsor of 281,250 founder shares. General We are a newly formed blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. To date, our efforts have been limited to organizational activities and activities related to this offering. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any target business regarding entering into a business combination with us. While we may pursue a business combination target in any business, industry or geographical location, we intend to focus our search on businesses in the fintech industry. Notwithstanding the foregoing, we will not pursue a target business that is headquartered in, or conducts a majority of its business in, China or Hong Kong. We believe that we will add value to these businesses primarily by providing them with access to the U.S. capital markets. Our team consists of experienced professionals and operating executives. Collectively, our officers and directors have significant experience in mergers and acquisitions and operating companies in the global markets. We believe we can leverage our team s stellar track record to identify and execute attractive acquisition opportunities. However, there is no assurance that we will complete a business combination. Our officers and directors have no prior experience consummating a business combination for a blank check company. We will seek to capitalize on the significant financial services, financial technology and banking experience and contacts of Eric Chen, our Chief Executive Officer and Chief Financial Officer and Axel Hoerger, our Chairman of the Board, to identify, evaluate and acquire a target business. Both Mr. Chen and Mr. Hoerger have extensive experience in the financial services industry, in particular, the financial technology-vertical, as well as extensive experience in operating public and private companies in the financial services industry. Our team brings significant investment acumen and strong global and local personal networks. Mr. Chen, with over twenty years of experience in financial services and financial technology sectors, is the co-founder/CEO of American International Bank LLC ( AIB ) licensed in both Puerto Rico and in New York, NY. AIB is a private bank focusing on Ultra-High-Net-Worth Individuals ( UHNWI ) around the world but mainly from Asia. As the CEO of the bank, Mr. Chen ensures the implementation and achievement of AIB s current and future strategic direction set by the Board, and ensures delivery of strategic and operational key performance results, and outcomes, across the organization. He also provides the mandate and leadership for the Executive Team to work in partnership across their operational groups, to lead and implement continuous improvements in business processes, leveraging digital transformation, and ensuring delivery of customer centric services. He is accountable for developing new business opportunities and sustaining valuable relationships with different stakeholders to ensure the bank s continuous expansion and business growth. Prior to the creation of AIB, Mr. Chen was the Senior Vice President at Macquarie Group in Beijing heading up its North East Asia Operations. During his time in China, he established and opened doors for the group to expand its business exponentially. He was the lead contact person for the strategic partnership with China Investment Corporation (CIC) to identify/co-invest in real estate opportunities around the globe. He led strategic investments and acquisitions into multiple office towers in Beijing and retail shopping centers across China. He also previously worked for Citigroup Hong Kong in the early 2000s with significant deal flow in real estate and other investments. 2 Table of Contents Mr. Hoerger has a financial services background that spans over three decades. From February 2016 to June 2020, Mr. Hoeger has served as Chief Executive Officer of Lombard International Assurance, Luxembourg, the largest life insurance company in Europe for unit linked and affiliated products and a fully owned portfolio company of the Blackstone Group, Mr. Hoerger has delivered record growth numbers in combination with a complete management overhaul and efficiency programs. Under his leadership, he restructured the IT department with new development and offerings to clients, including the digital onboarding of clients in France, one of the biggest countries in Europe. From 2011 until March 2015, Mr. Hoerger served as Chief Executive Officer of UBS Deutschland AG, He led the consolidation of the German booking Platform into the Swiss booking Platform. This project achieved large efficiency gains for the future and it enabled the group to build its European headquarters outside Switzerland business in Frankfurt, Germany. From 2009 to March 2010, Mr Hoerger served as Head of Institutional Sales for Goldman Sachs Asset Management in EMEA, leading client acquisition activities and defining market and product strategy across the region. Mr. Hoerger served for 16 years at Goldman Sachs in several management positions and was instrumental in building the Asset Management Division. In addition to any potential business and investment targets we may identify on our own, we anticipate that other target business candidates will be brought to our attention from various unaffiliated sources, including investment market participants, private equity funds and large business enterprises seeking to divest non-core assets or divisions. In evaluating a prospective target business, we intend to conduct an extensive due diligence review which will encompass, as applicable and among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities, and a deep review and stress testing of financial and other information about the target and its industry. Our management team will also be supported by the broader AIB team. We have strong connections through our independent director nominees, who will also provide additional insight into our target sectors with extensive experience in acquiring, building and managing global teams and businesses. Investment Criteria Our management team intends to focus on creating shareholder value by leveraging its experience in the management, operation and financing of businesses to improve the efficiency of operations while implementing strategies to help our potential acquisition target scale revenue organically and/or through acquisitions. We have identified the following general criteria and guidelines, which we believe are important in evaluating prospective target businesses. While we intend to use these criteria and guidelines in evaluating prospective businesses, we may deviate from these criteria and guidelines should we see justification to do so. Middle-Market Growth Business. We will primarily seek to acquire one or more growth businesses with a total enterprise value of between $225,000,000 and 375,000,000. We believe that there are a substantial number of potential target businesses within this valuation range that can benefit from new capital for scalable operations to yield significant revenue and earnings growth. We currently do not intend to acquire either a start-up company (a company that has not yet established commercial operations) or a company with negative cash flow. Companies in Business Segments that Are Strategically Significant. We will seek to acquire businesses in sectors that are currently strategically significant including accounting and expense management, blockchain, capital markets, digital banking and financial infrastructure, HR, payroll, and benefits, insurance, lending, payments, billing, and money transfer, personal finance, real estate, regulatory tech, and wealth management. Business with Revenue and Earnings Growth Potential. We will seek to acquire one or more businesses that have the potential for significant revenue and earnings growth through a combination of both existing and new product development, increased production capacity, expense reduction and synergistic follow-on acquisitions resulting in increased operating leverage. 3 Table of Contents Companies with Potential for Strong Free Cash Flow Generation. We will seek to acquire one or more businesses that have the potential to generate strong, stable and increasing free cash flow. We intend to focus on one or more businesses that have predictable revenue streams and definable low working capital and capital expenditure requirements. We may also seek to prudently leverage this cash flow in order to enhance shareholder value. Benefit from Being a Public Company. We intend to acquire a business or businesses that will benefit from being publicly traded and which can effectively utilize access to broader sources of capital and a public profile that are associated with being a publicly traded company. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general criteria and guidelines as well as other considerations, factors and criteria that our management team may deem relevant. We believe our management team s extensive contacts, broad industry knowledge and highly regarded experience will yield a robust deal flow from which we may select a target. We will seek to acquire the target on terms and in a manner that leverages our management team s experience. The potential upside from growth in the target business and an improved capital structure will be weighed against any identified downside risks designed to balance value creation with capital preservation. In the event that we decide to enter into an initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria and guidelines in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials, as applicable, that we would file with the United States Securities and Exchange Commission, or the SEC. In evaluating a prospective target business, we expect to conduct a due diligence review which may encompass, among other things, meetings with incumbent ownership, management and employees, document reviews, interviews of customers and suppliers, inspections of facilities, as well as reviewing financial and other information which will be made available to us. Competitive Strengths Management Team We believe that our management team s extensive relationships within the financial services industry will enable us to identify business combination opportunities with significant potential upside. We expect that our management team s combined experience, when paired with our ability to perform under varying economic environments, will be a differentiating factor that is highly attractive to potential target companies. Status as a Public Company We believe that our structure will make us an attractive business combination partner to target businesses. As an existing public company, we offer a target business an alternative to a traditional initial public offering through a merger or other business combination. In this situation, the owners of the target business would exchange their stock, shares or other equity interests in the target business for our ordinary shares or for a combination of our ordinary shares and cash, allowing us to tailor the consideration used in the transaction to the specific needs of the sellers. We believe that target businesses might find this avenue a more certain and cost-effective method to becoming a public company than a typical initial public offering. In a typical initial public offering, there are additional expenses incurred in marketing, roadshow and public reporting efforts that will likely not be present to the same extent in connection with a business combination with us. Furthermore, once the business combination is consummated, the target business will have effectively become a public company, whereas an initial public offering is always subject to the underwriters ability to complete the offering, as well as general market conditions that could prevent the offering from occurring. Once public, we believe the target business would then have greater access to capital and an additional means of providing management incentives consistent with shareholders interests than it would have as a privately-held company. Public company status can offer further benefits by enhancing a company s profile among potential new customers and vendors and attracting talented employees. While we believe that our status as a public company will make us an attractive business partner, some potential target businesses may view the inherent limitations in our status as a blank check company as a deterrent and may prefer to effect a business combination with a more established entity or with a private company. These limitations include constraints on our available financial resources, which may be inferior to those of other entities pursuing the acquisition of similar target businesses; the 4 Table of Contents requirement that we seek shareholder approval of a business combination or conduct a tender offer in relation thereto, which may delay the consummation of a transaction; and the existence of our outstanding rights, which may represent a source of future dilution. Financial Position With funds in the trust account of $75,750,000 (or $87,112,500 if the over-allotment option is exercised in full) available to use for a business combination (assuming no shareholder seeks redemption of their shares or seeks to sell their shares to us in any tender offer in relation to such business combination), we will offer a target business a variety of options, such as providing the owners of a target business with shares in a public company and a public means to sell such shares, providing capital for the potential growth and expansion of its operations and strengthening its balance sheet by reducing its debt ratio. Because we are able to consummate our initial business combination using our cash, debt or equity securities, or a combination of the foregoing, we have the flexibility to use the most efficient combination that will allow us to tailor the consideration to be paid to the target business to fit its needs and desires. However, since we have no specific business combination under consideration, we have not taken any steps to secure third party financing, and there can be no assurance that it will be available to us. Furthermore, redemptions in connection with our initial business combination could reduce the amount of funds available to be used in connection with such business combinations. Effecting a Business Combination General We are not presently engaged in, and we will not engage in, any substantive commercial business for an indefinite period of time following this offering. We intend to utilize cash derived from the proceeds of this offering and the private placement of private units, our equity, debt or a combination of these in effecting a business combination which has not yet been identified. Accordingly, investors in this offering are investing without first having an opportunity to evaluate the specific merits or risks of any one or more business combinations. A business combination may involve the acquisition of, or merger with, a company which does not need substantial additional capital but which desires to establish a public trading market for its shares, while avoiding what it may deem to be adverse consequences of undertaking a public offering itself. These include time delays, significant expense, loss of voting control and compliance with various federal and state securities laws. In the alternative, we may seek to consummate a business combination with a company that may be financially unstable or in its early stages of development or growth. While we may seek to effect simultaneous business combinations with more than one target business, we will probably have the ability, as a result of our limited resources, to effect only a single business combination. We will either (1) seek shareholder approval of our initial business combination at a general meeting called for such purpose at which shareholders may seek to convert their shares, regardless of whether they vote for or against the proposed business combination or don t vote at all, into their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable), or (2) provide our shareholders with the opportunity to sell their shares to us by means of a tender offer (and thereby avoid the need for a shareholder vote) for an amount equal to their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable), in each case subject to the limitations described herein. The decision as to whether we will seek shareholder approval of our proposed business combination or allow shareholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek shareholder approval. If we decide to allow shareholders to sell their shares to us in a tender offer, we will file tender offer documents with the SEC which will contain substantially the same financial and other information about the initial business combination as is required under the SEC s proxy rules. We will consummate our initial business combination only if we have net tangible assets of at least $5,000,001 either immediately prior to or upon such consummation and, if we seek shareholder approval, we obtain the approval of an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the company. We will have up to 12 months from the closing of this offering to consummate an initial business combination. However, if we anticipate that we may not be able to consummate our initial business combination within 12 months, we may, by resolution of our board if requested by our sponsor, extend the period of time to consummate a business combination up to three times, each by an additional three months (for a total of up to 21 months to complete a 5 Table of Contents business combination), subject to the sponsor depositing additional funds into the trust account as set out below. Our shareholders will not be entitled to vote or redeem their shares in connection with any such extension. However, our shareholders will be entitled to vote and redeem their shares in connection with a general meeting held to approve an initial business combination or in a tender offer undertaken in connection with an initial business combination if we propose such a business combination during any three-month extension period. Pursuant to the terms of our memorandum and articles of association and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order for the time available for us to consummate our initial business combination to be extended, our sponsor or its affiliates or designees, upon five days advance notice prior to the applicable deadline, must deposit into the trust account $750,000, or $862,500 if the underwriters over-allotment option is exercised in full ($0.10 per unit in either case, up to an aggregate of $2,250,000 or $2,587,500 if the underwriters over-allotment option is exercised in full) on or prior to the date of the applicable deadline, for each three month extension. In the event that we receive notice from our sponsor five days prior to the applicable deadline of its wish for us to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the applicable deadline announcing whether or not the funds had been timely deposited. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. If we are unable to consummate an initial business combination within such time period, we will redeem 100% of our issued and outstanding public shares for a pro rata portion of the funds held in the trust account, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $50,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and as further described herein, and then seek to liquidate and dissolve. We expect the pro rata redemption price to be approximately $10.10 per Class A ordinary share (regardless of whether or not the underwriters exercise their over-allotment option), without taking into account any interest earned on such funds. However, we cannot assure you that we will in fact be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public shareholders. We Have Not Identified a Target Business To date, we have not selected any target business on which to concentrate our search for a business combination. None of our sponsor, officers, directors, promoters and other affiliates has engaged in any substantive discussions on our behalf with representatives of other companies regarding the possibility of a potential merger, share exchange, asset acquisition or other similar business combination with us. Additionally, we have not engaged or retained any agent or other representative to identify or locate such companies. As a result, we cannot assure you that we will be able to locate a target business or that we will be able to engage in a business combination with a target business on favorable terms or at all. Subject to our management team s pre-existing fiduciary obligations and the fair market value requirement described below, we will have virtually unrestricted flexibility in identifying and selecting a prospective acquisition candidate. We have not established any specific attributes or criteria (financial or otherwise) for prospective target businesses other than as described above. Accordingly, there is no basis for investors in this offering to evaluate the possible merits or risks of the target business with which we may ultimately complete a business combination. Although our management will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors. Sources of Target Businesses While we have not yet selected a target business with which to consummate our initial business combination, we believe based on our management s business knowledge and past experience that there are numerous potential candidates. We expect that our principal means of identifying potential target businesses will be through the extensive contacts and relationships of our sponsor, initial shareholders, officers and directors. While our officers and directors are not required to commit any specific amount of time in identifying or performing due diligence on potential target businesses, our officers and directors believe that the relationships they have developed over their careers and their access to our sponsor s contacts and resources will generate a number of potential business combination opportunities that will warrant further investigation. We also anticipate that target business candidates will be brought to our attention from various unaffiliated sources, including investment bankers, venture capital funds, private equity funds, leveraged buyout funds, management buyout funds and other members of the financial community. Target businesses may be 6 Table of Contents brought to our attention by such unaffiliated sources as a result of being solicited by us through calls or mailings. These sources may also introduce us to target businesses they think we may be interested in on an unsolicited basis, since many of these sources will have read this prospectus and know what types of businesses we are targeting. Our officers and directors must present to us all target business opportunities that have a fair market value of at least 80% of the assets held in the trust account (excluding taxes payable on the income accrued in the trust account) at the time of the agreement to enter into the initial business combination, subject to any pre-existing fiduciary or contractual obligations. While we do not presently anticipate engaging the services of professional firms or other individuals that specialize in business acquisitions on any formal basis, we may engage these firms or other individuals in the future, in which event we may pay a finder s fee, consulting fee or other compensation to be determined in an arm s length negotiation based on the terms of the transaction. In no event, however, will our sponsor, initial shareholders, officers, directors or their respective affiliates be paid any finder s fee, consulting fee or other compensation prior to, or for any services they render in order to effectuate, the consummation of an initial business combination (regardless of the type of transaction that it is) other than the $10,000 administrative services fee, the payment of consulting, success or finder fees to our sponsor, officers, directors, initial shareholders or their affiliates in connection with the consummation of our initial business combination, the repayment of the $300,000 loan and reimbursement of any out-of-pocket expenses. Our audit committee will review and approve all reimbursements and payments made to our sponsor, officers, directors or our or their respective affiliates, with any interested director abstaining from such review and approval. We have no present intention to enter into a business combination with a target business that is affiliated with any of our officers, directors or sponsors. However, we are not restricted from entering into any such transactions and may do so if (i) such transaction is approved by a majority of our disinterested independent directors and (ii) we obtain an opinion from an independent investment banking firm, or another independent entity that commonly renders valuation opinions, that the business combination is fair to our unaffiliated shareholders from a financial point of view. Selection of a Target Business and Structuring of a Business Combination Subject to our management team s pre-existing fiduciary obligations and the limitations that a target business have a fair market value of at least 80% of the balance in the trust account (excluding taxes payable on the income earned on the trust account) at the time of the execution of a definitive agreement for our initial business combination, as described below in more detail, and that we must acquire a controlling interest in the target business, our management will have virtually unrestricted flexibility in identifying and selecting a prospective target business. We have not established any specific attributes or criteria (financial or otherwise) for prospective target businesses. In evaluating a prospective target business, our management may consider a variety of factors, including one or more of the following: financial condition and results of operation; growth potential; brand recognition and potential; experience and skill of management and availability of additional personnel; capital requirements; competitive position; barriers to entry; stage of development of the products, processes or services; existing distribution and potential for expansion; degree of current or potential market acceptance of the products, processes or services; proprietary aspects of products and the extent of intellectual property or other protection for products or formulas; impact of regulation on the business; regulatory environment of the industry; 7 Table of Contents the target business s compliance with U.S. federal law; costs associated with effecting the business combination; industry leadership, sustainability of market share and attractiveness of market industries in which a target business participates; and macro competitive dynamics in the industry within which the company competes. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular business combination will be based, to the extent relevant, on the above factors as well as other considerations deemed relevant by our management in effecting a business combination consistent with our business objective. In evaluating a prospective target business, we will conduct an extensive due diligence review which will encompass, among other things, meetings with incumbent management and inspection of facilities, as well as review of financial and other information which is made available to us. This due diligence review will be conducted either by our management or by unaffiliated third parties we may engage, although we have no current intention to engage any such third parties. The time and costs required to select and evaluate a target business and to structure and complete the business combination cannot presently be ascertained with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which a business combination is not ultimately completed will result in a loss to us and reduce the amount of capital available to otherwise complete a business combination. Fair Market Value of Target Business Nasdaq listing rules require that the target business or businesses that we acquire must collectively have a fair market value equal to at least 80% of the balance of the funds in the trust account (excluding taxes payable on the income earned on the trust account) at the time of the execution of a definitive agreement for our initial business combination. Notwithstanding the foregoing, if we are not then listed on Nasdaq for whatever reason, we would no longer be required to meet the foregoing 80% fair market value test. We currently anticipate structuring a business combination to acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination where we merge directly with the target business or where we acquire less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we could acquire a 100% controlling interest in the target; however, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of trust account balance test. The fair market value of the target will be determined by our board of directors based upon one or more standards generally accepted by the financial community (such as actual and potential sales, earnings, cash flow and/or book value). The proxy solicitation materials or tender offer documents used by us in connection with any proposed transaction will provide public shareholders with our analysis of the fair market value of the target business, as well as the basis for our determinations. If our board is not able to independently determine that the target business has a sufficient fair market value, we will obtain an opinion from an unaffiliated, independent investment banking firm, or another independent entity that commonly renders valuation opinions, with respect to the satisfaction of such criteria. 8 Table of Contents We will not be required to obtain an opinion from an investment banking firm as to the fair market value if our board of directors independently determines that the target business complies with the 80% threshold. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. Lack of Business Diversification We may seek to effect a business combination with more than one target business, although we expect to complete our business combination with just one business. Therefore, at least initially, the prospects for our success may be entirely dependent upon the future performance of a single business operation. Unlike other entities which may have the resources to complete several business combinations of entities operating in multiple industries or multiple areas of a single industry, it is probable that we will not have the resources to diversify our operations or benefit from the possible spreading of risks or offsetting of losses. By consummating a business combination with only a single entity, our lack of diversification may: subject us to numerous economic, competitive and regulatory developments, any or all of which may have a substantial adverse impact upon the particular industry in which we may operate subsequent to a business combination, and result in our dependency upon the performance of a single operating business or the development or market acceptance of a single or limited number of products, processes or services. If we determine to simultaneously acquire several businesses and such businesses are owned by different sellers, we will need for each of such sellers to agree that our purchase of its business is contingent on the simultaneous closings of the other acquisitions, which may make it more difficult for us, and delay our ability, to complete the business combination. With multiple acquisitions, we could also face additional risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence investigations (if there are multiple sellers) and the additional risks associated with the subsequent assimilation of the operations and services or products of the acquired companies in a single operating business. We currently anticipate structuring a business combination to acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination where we merge directly with the target business or where we acquire less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we could acquire a 100% controlling interest in the target; however, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of trust account balance test. Prior to the effectiveness of the registration statement of which this prospectus forms a part, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the completion of our initial business combination. 9 Table of Contents Potential Conflicts Members of our management team will directly or indirectly own ordinary shares, or other instruments, such as rights, linked to our ordinary shares, following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Our sponsor, officers and directors may participate in the formation of, or become an officer or director of, any other blank check company prior to completion of our initial business combination. As a result, our sponsor, officers or directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. Our officers and directors have agreed to present to us all target business opportunities that have a fair market value of at least 80% of the assets held in the trust account (excluding taxes payable on the income accrued in the trust account), subject to any pre-existing fiduciary or contractual obligations. As more fully discussed in Management Conflicts of Interest, if any of our officers or directors becomes aware of an initial business combination opportunity that may be attractive to any entity to which he has pre-existing fiduciary or contractual obligations, he will be required to present such initial business combination opportunity to such entity prior to presenting such initial business combination opportunity to us. Certain of our officers and directors currently have certain relevant pre-existing fiduciary duties or contractual obligations. Accordingly, they will be required to present all suitable business combination opportunities to such entities prior to presenting them to our company for consideration. For more information on the relevant pre-existing fiduciary duties or contractual obligations of our management team, see the section titled Management Conflicts of Interest. JOBS Act and Other Corporate Information We are an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 (which we refer to herein as the JOBS Act) and will remain such for up to five years. However, if our annual gross revenue is $1.07 billion or more, if our non-convertible debt issued within a three year period exceeds $1 billion or the market value of our ordinary shares that are held by non-affiliates exceeds $700 million on the last day of the second fiscal quarter of any given fiscal year, we would cease to be an emerging growth company as of the following fiscal year. As an emerging growth company, we have elected, under Section 107(b) of the JOBS Act, to take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended, or the Securities Act, for complying with new or revised accounting standards. Exempted companies are Cayman Islands companies wishing to conduct business outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations shall apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax shall be payable (1) on or in respect of our shares, debentures or other obligations or (2) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are a Cayman Islands exempted company incorporated on June 18, 2021. Our executive offices are located at 875 Third Avenue, Suite M204A New York, New York 10022 and our telephone number is (212) 380-8128. 10 Table of Contents Private Placements Our sponsor paid $25,000 to cover certain of our offering costs in consideration for 1,437,500 Class B ordinary shares issued on July 30, 2021, which we refer to throughout this prospectus as the founder shares . On September 13, 2021, the Company effected a share dividend of 0.5 shares for each Class B ordinary share outstanding, resulting in an aggregate of 2,156,250 founder shares outstanding. The founder shares held by our initial shareholders includes an aggregate of up to 281,250 shares subject to forfeiture to the extent that the underwriters over-allotment option is not exercised in full or in part, so that our initial shareholders will own 20.0% of our issued and outstanding shares after this offering (not including the private shares underlying the private units and assuming the initial shareholders do not purchase units in this offering). In addition, our sponsor has committed that it will purchase from us an aggregate of 317,500 private units at $10.00 per unit for a total purchase price of $3,175,000 and Maxim Group LLC has agreed to purchase an aggregate of 37,500 private placement units at a price of $10.00 per private unit, for an aggregate purchase price of $375,000, in a private placement that will occur simultaneously with the consummation of this offering. Our sponsor has also agreed that if the over-allotment option is exercised by the underwriters in full or in part, it will purchase from us additional private units on a pro rata basis (up to a maximum of 28,125 additional private units at a price of $10.00 per unit) and Maxim Group LLC has also agreed that if the over-allotment is exercised by the underwriters in full or in part, it will purchase from us additional private placement units on a pro-rata basis (up to a maximum of 5,625 additional private placement units at a price of $10.00 per unit) in an amount that is necessary to maintain in the trust account $10.10 per unit sold to the public in this offering. These additional private units will be purchased in a private placement that will occur simultaneously with the purchase of units resulting from the exercise of the over-allotment option. The private units are identical to the units sold in this offering, subject to certain limited exceptions as described in this prospectus. The proceeds from the private placement of the private units will be added to the proceeds of this offering and placed in a United States-based trust account maintained by Continental Stock Transfer & Trust Company, as trustee. If we do not complete an initial business combination within 12 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus), the proceeds from the sale of the private units will be included in the liquidating distribution to our public shareholders and the private units will be worthless. 11 Table of Contents
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: we, us, our, company or our company are to Energy Cloud I Acquisition Corporation, a BVI business company limited by shares and incorporated with company number 2071142; references to the BVI refer to the British Virgin Islands; references to the Companies Act and the Insolvency Act refer to the BVI Business Companies Act, 2004 and the Insolvency Act, 2003 of the British Virgin Islands, respectively and in each case as amended; references to the memorandum and articles of association are to the memorandum and articles of association of the Company, unless the context otherwise requires; references in this prospectus to founder shares refer to the 2,156,250 ordinary shares currently held by the initial shareholders (as defined below), which includes up to an aggregate of 281,250 ordinary shares subject to forfeiture by our initial shareholders to the extent that the underwriters over-allotment option is not exercised in full or in part; references to our initial shareholders refer to our sponsor and any of our officers and directors who hold founder shares; references to our management or our management team refer to our officers and directors; references to our insider units or private units refer to 232,500 (or 249,375 if the overallotment is exercised in full) units we are selling privately to our sponsor and/or its designees upon consummation of this offering; references to private shares , private rights and private warrants refer to the ordinary shares, rights and warrants included within the private units; references to our private placement are to the private placement of 232,500 private units (up to 249,375 private units if the over-allotment option is exercised in full) at a price of $10.00 per private unit, for an aggregate purchase price of $2,325,000 (up to $2,493,750 if the over-allotment option is exercised in full), which will occur simultaneously with the completion of this offering; references to ordinary shares or shares refer to the ordinary shares, no par value, of the company; references to our public shares refer to ordinary shares which are being sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and references to public shareholders refer to the holders of our public shares, including our initial shareholders to the extent our initial shareholders purchase public shares, provided that their status as public shareholders shall exist only with respect to such public shares; references to Registrar refer to the Registrar of Corporate Affairs in the British Virgin Islands; references to our sponsor refer to Energy Cloud Sponsor Holdings Limited, a BVI business company limited by shares with company number 2069005; references to representative refers to EF Hutton, division of Benchmark Investments, LLC, who is the representative of the underwriters in this offering; references to representative shares refers to the 75,000 ordinary shares (86,250 if the over-allotment option is exercised in full) issued as compensation to the representative and/or its designees; 1 Table of Contents references to our public rights refer to the (1/20) of one ordinary share upon consummation of our initial business combination rights which are being sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market, including rights that may be acquired by our sponsor or its affiliates in the open market); references to rights refer to the public rights as well as the private rights and rights underlying units issued upon conversion of working capital loans; references to our public warrants refer to the redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market, including warrants that may be acquired by our sponsor or its affiliates in the open market); and references to our warrants refer to the public warrants as well as the private warrants and warrants underlying units issued upon conversion of working capital loans. Except as specifically provided otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. You should rely only on the information contained in this prospectus. We have not, and the underwriters have not, authorized anyone to provide you with different information. We are not, and the underwriters are not, making an offer of these securities in any jurisdiction where the offer is not permitted. General Background We are a blank check company incorporated in the British Virgin Islands as a business company limited by shares (meaning that our shareholders have no liability, as members of our company, for the liabilities of our company over and above the amount paid for their ordinary shares) and formed for the purpose of acquiring, engaging in a share exchange, share reconstruction and amalgamation with, purchasing all or substantially all of the assets of, entering into contractual arrangements with, or engaging in any other similar business combination with, one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. We have not, nor has anyone on our behalf, initiated any discussions, directly or indirectly, with representatives of other companies regarding the possibility of a potential business combination with our company. From the date of our formation through the date of this prospectus, there have been no communications or discussions between any of our officers, directors or our sponsor and any of their contacts or relationships regarding a potential initial business combination with our company. Business Strategy Our efforts in identifying prospective target businesses will not be limited to a particular industry or country, although we intend to focus on businesses in clean energy sectors that have their primary operations located in the Asia-pacific region ( Asia-pacific or Asia ). We believe that we will add value to these businesses primarily by providing them with access to the U.S. capital markets. We will seek to capitalize on the strength of our management team. Our team consists of experienced capital market services and accounting professionals, senior operating executives, and business managers. Our directors have experience in entrepreneurship, asset management/advisory services, and accounting & tax practices in mainland China, Hong Kong, the U.S. and Canada, as well as knowledge of sectors and industries arising in connection with the provision of those services and entrepreneurial experiences. We believe we will benefit from their accomplishments, and specifically their current activities in the Asian market, in identifying attractive acquisition opportunities. However, the past performance of our management team and their affiliates is not a guarantee either of (i) success of any business combination we may consummate, or (ii) that we will complete a business combination. Our acquisition strategy will leverage our team s network of capital market, private equity and green energy industry relationships as well as relationships with management teams of public and private companies, investment bankers, attorneys and accountants, which we believe should provide us with a number of potential target businesses with which we may consummate an initial business combination. We intend to deploy a pro-active, thematic 2 Table of Contents sourcing strategy and to focus on companies where we believe the combination of our relationships, capital and capital markets expertise and operating experience of our management team members, can help accelerate the target business growth and performance. In order to maximize the quality and objective assessment of the viability and value of a potential target acquisition, any business combination undertaken by the Company will be reviewed and approved by a majority of our independent directors prior to being submitted to the shareholders for a vote or undertaking a tender offer should it be necessary under applicable regulation as discussed elsewhere in this prospectus. We will seek to capitalize on the comprehensive industry experience and network of our executive officers in consummating an initial business combination in sectors that we believe have strategic significance to the Asia-pacific economy, including but not limited to renewables, de-carbonization, biofuels, carbon capture, utilization and storage, hydrogen fuel and fuel cell technologies, electric vehicle infrastructure, and energy storage, etc., as well as other related sectors that will ideally have a positive environmental and social impact in the Environmental, Social, and Governance sphere (the ESG ). We intend to focus on target companies with the following characteristics: mid-market companies with an enterprise value between $200 million and $800 million and high growth potential; companies that have strategic significance to the Asia economy; companies that we believe can leverage favorable demographic, political, and economic trends within Asia; companies operating in a competitive landscape; companies with strategic financial backers; companies that intend to expand their businesses overseas; and companies with a management team that has a history of strong corporate governance and ambition to pursue a disciplined growth. We intend to leverage our management team s collective background in business management, finance, technology, and the private equity industry in Asia and the North America, as well as their broad network to identify the most valuable target companies among what we believe will be a large pool of potential acquisition candidates. Our experienced management team will conduct careful technology and business diligence on potential target companies. We believe that we can provide in-depth business management expertise to guide a target company in streamlining its operations and enhance its product development and service offerings. In addition, we believe we can provide capital market support to assist a target company to improve the company s transparency in the capital markets and guide the company in raising sufficient fund to support its growth. Investment Criteria Our management team intends to focus on creating shareholder value by leveraging its experience in the management, operation and financing of businesses to improve the efficiency of operations while implementing strategies to scale revenue organically and/or through acquisitions. In addition to the factors listed above, we have identified the following general criteria and guidelines, which we believe are important in evaluating prospective target businesses. While we intend to use these criteria and guidelines in evaluating prospective businesses, we may deviate from these criteria and guidelines should we see the justification to do so. Middle-Market Growth Business. We will primarily seek to acquire one or more growth businesses with a total enterprise value of between $200 million and $800 million. We believe that a substantial number of potential target businesses within this valuation range can benefit from new capital for scalable operations to yield significant revenue and earnings growth. We currently do not intend to acquire either a start-up company (a company that has not yet established commercial operations) or a company with negative cash flow. 3 Table of Contents Companies with Opportunity to Strengthen Management and Add Value. We will seek to acquire one or more businesses that provide a platform for the existing management team to leverage the experience of our management team. We believe that the operating expertise of our management team is well suited to complement and, if beneficial, replace the target s management team. Companies in Business Segments that are Strategically Significant to the Asia-pacific region. We will seek to acquire those businesses with strong technological know-how, distribution networks and/or business practices in economic sectors that are currently experiencing significant outbound investing in the Asia-pacific region. Such sectors include, but are not limited to, clean energy, health care, consumer, new energy and resources that having positive environmental and social impact in the Environmental, Social, and Governance sphere. Business with Revenue and Earnings Growth Potential. We will seek to acquire one or more businesses with the potential for significant revenue and earnings growth through a combination of existing and new product development, increased production capacity, expense reduction, and synergistic follow-on acquisitions resulting in increased operating leverage. Niche Leader and Specialized Business with Earning Growth Potential. We intend to seek target companies that have significant underexploited expansion opportunities in a niche sector. One of the key elements of our sponsor s typical value creation approach is to acquire target companies to accelerate their growth. We will seek to acquire one or more businesses that have the potential for significant revenue and earnings growth through a combination of brand and new product development, increased production capacity, expense reduction and synergistic follow-on acquisitions resulting in increased operating leverage. This can be accomplished through a combination of accelerating organic growth and finding attractive add-on acquisition targets. Our management team has significant experience in identifying such targets and helping target management assess the strategic and financial fit. Similarly, our management has the expertise to assess the likely synergies and a process to help a target integrate acquisitions. Long-term Revenue Visibility with Defensible Market Position. We intend to seek target companies that are at an inflection point, such as those requiring additional management expertise, are able to innovate by developing new products or services, or where we believe we can drive improved financial performance and where an acquisition may help facilitate growth. Companies with Potential for Strong Free Cash Flow Generation. We intend to seek to acquire one or more businesses that have the potential to generate strong, stable and increasing free cash flow. We intend to focus on one or more businesses that have predictable revenue streams and definable low working capital and capital expenditure requirements. We may also seek to prudently leverage this cash flow in order to enhance shareholder value. Benefit from Being a Public Company. We intend to acquire a business or businesses that will benefit from being publicly traded and which can effectively utilize access to broader sources of capital and a public profile that are associated with being a publicly-traded company. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our sponsor and management team may deem relevant. We do not intend to consider any PRC Target Company that may be deemed as an operator of critical information infrastructure by the Cybersecurity Administration of China, or any PRC Target Company that possesses personal information of more than one million users that may involve in data (for example, mobile Internet companies). In the event that we decide to enter into an initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials, as applicable, that we would file with the United States Securities and Exchange Commission. In evaluating a prospective target business, we expect to conduct a due diligence review which may encompass, among other things, meetings with incumbent ownership, management and employees, document reviews, interviews of customers and suppliers, inspections of facilities, as well as reviewing financial and other information which will be made available to us. 4 Table of Contents Sourcing of Potential Initial Business Combination Targets Our management team, both itself as well as through our relationship with the beneficial owners of our sponsor, Energy Cloud Sponsor Holdings Limited, has developed a broad network of contacts and corporate relationships. We believe that the network of contacts and relationships of our management team and our beneficial owners will provide us with an important source of introductions to target businesses. In addition, we anticipate that target business candidates will be brought to our attention from various unaffiliated sources, including investment banking firms, private equity firms, consultants, accounting firms and business enterprises. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors, or completing the business combination through a joint venture or other form of shared ownership with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a target that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, would obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions that our initial business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other context. As more fully discussed in Management Conflicts of Interest, if any of our officers or directors becomes aware of a business combination opportunity that is appropriate for any entity to which he or she has pre-existing statutory, fiduciary or contractual obligations, he or she may be required to present such business combination opportunity to such entity prior to presenting such business combination opportunity to us. Our officers have agreed not to become involved with another publicly listed blank check company with a class of securities registered under the Securities Exchange Act of 1934, as amended, prior to us announcing an agreement to acquire our initial business combination, or the expiration of the period for us to announce and/or complete our initial business combination. Initial Business Combination We will have until 12 months from the closing of this offering to consummate our initial business combination. If we anticipate that we may not be able to consummate our initial business combination within 12 months, we may, by resolution of our board if requested by our sponsor, extend the period of time to consummate a business combination up to two times, each by an additional three months (for a total of up to 18 months to complete a business combination), subject to the sponsor depositing additional funds into the trust account as set out below. Pursuant to the terms of our memorandum and articles of association and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order for the time available for us to consummate our initial business combination to be extended, our sponsor or its affiliates or designees, upon five days advance notice prior to the applicable deadline, must deposit into the trust account $750,000, or $862,500 if the underwriters over-allotment option is exercised in full ($0.10 per Unit in either case), on or prior to the date of the applicable deadline, for each of the two available three month extensions providing a total possible business combination period of 18 months at a total payment value of $1,500,000, or $1,725,000 if the underwriters over-allotment option is exercised in full ($0.10 per Unit in either case). In the event that we receive notice from our sponsor five days prior to the applicable deadline of its wish for us to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the applicable deadline announcing whether or not the funds had been timely deposited. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. If we are unable to consummate our initial business combination within the applicable time period from the closing of this offering, we will, as promptly as reasonably possible but not more than five business days thereafter, redeem the public shares for a pro rata portion of the funds held in the trust account and as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under British Virgin Islands law to provide for claims of creditors and the requirements of other applicable law. In such event, the warrants will be worthless. Nasdaq rules require that our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (less taxes payable) at the time of the agreement to enter into the initial business combination. If our board is not able to 5 Table of Contents independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions with respect to the satisfaction of such criteria. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire substantially all of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than substantially all of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If the initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. Private Placements Prior to this offering, we issued an aggregate of 2,156,250 founder shares (up to 281,250 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised) to our initial shareholders for an aggregate purchase price of $25,000, or approximately $0.012 per share. Subject to certain limited exceptions, our initial shareholders have agreed not to transfer, assign or sell their founder shares until one year after the date of the consummation of our initial business combination or earlier if, subsequent to our initial business combination, we consummate a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of our shareholders having the right to exchange their ordinary shares for cash, securities or other property. Our initial shareholders have agreed to purchase an aggregate of 232,500 Units (or 249,375 Units if the over-allotment option is exercised in full) at a price of $10.00 per unit for an aggregate purchase price of $2,325,000 (or $2,493,750 if the over-allotment option is exercised in full) in a private placement that will occur simultaneously with the closing of this offering. Subject to certain limited exceptions, our initial shareholders have agreed not to transfer, assign or sell any of the private units and underlying ordinary shares until after the completion of our initial business combination. Potential Acquisition in China We intend to focus on acquiring a target business in Asia, including P.R. China, or PRC. In addition, our officers and directors have significant ties to PRC. There are significant legal and operational risks associated with investing in a target business with its primary operations in PRC, which are described in more detail in the Risk Factors section of this document. These risks could result in a material change in our post-business combination operations, reduce the value of our ordinary shares, significantly limit or completely hinder our ability to offer or continue to offer securities to investors and/or cause the value of such securities to significantly decline or be worthless. Recent statements and regulatory actions by PRC s government, such as those related to the use of variable interest entities and data security or anti-monopoly concerns, has or may impact a post business combination company s ability to conduct its business, accept foreign investments, or list on an U.S. or other foreign exchange. 6 Table of Contents Structuring a transaction in China The PRC government has restricted or limited foreign ownership of certain kinds of assets and companies operating in certain industries. The restricted industry groups are broad, including certain aspects of telecommunications, advertising, food production and heavy equipment manufacturers. In addition, there can be restrictions on the foreign ownership of businesses determined from time to time to be in important industries that may affect the national economic security or having famous Chinese brand names or well established Chinese brand names. Subject to the review and approval of the Ministry of Commerce, or MOFCOM, and other relevant agencies as discussed elsewhere for acquisitions of assets and companies in the PRC and subject to the various percentage ownership limitations that exist from time to time, acquisitions involving foreign investors and parties in the various restricted categories of assets and industries may nonetheless sometimes be consummated using contractual arrangements with permitted Chinese parties, typically referred to as variable interest entities, or VIEs. To the extent such agreements are employed, they may be for control of specific assets such as intellectual property or control of blocks of the equity ownership interests of a company which may provide exceptions to the merger and acquisition regulations mentioned above since these types of arrangements typically do not involve a change of equity ownership in the PRC operating company. The agreements would be designed to provide us with the economic benefits of and control over the subject assets or equity interests similar to the rights of full ownership, while leaving the technical ownership in the hands of Chinese parties who would be our nominees and, therefore, may exempt the transaction from the merger and acquisition regulations, including the application process required thereunder. However, there has been limited implementation guidance provided with respect to the merger and acquisition regulations. PRC government agencies could apply these rules to a business combination effected through contractual arrangements. If such an agency determines such an application should have made, consequences may include levying fines, revoking business and other licenses, requiring restructure of ownership or operations and requiring discontinuation of any portion of all of the acquired business. These agreements likely also would provide for increased ownership or full ownership and control by us when and if permitted under PRC law and regulations. In addition, these contractual arrangements may be less effective than direct ownership and we may incur substantial costs to enforce the terms of the arrangements. There are uncertainties as to whether such contractual arrangements comply with the regulations prohibiting or restricting foreign ownership in certain industries. Even if such arrangements do not violate current regulations, such regulations are subject to change in the future and may be broadened to further restrict foreign investments in new industries or new categories of assets. If we acquire a target company that operates its business in the PRC through contractual arrangements, investors in our ordinary shares following a business combination would not hold equity interests in VIEs domiciled in China under our control and would hold equity interests in a British Virginal Islands holding company. After a business combination with a company in the PRC, the combined company s ability to pay dividends, if any, to the shareholders and to service any debt it may incur will depend upon dividends paid by its PRC subsidiaries which are entitled to substantially all of the economic benefits of the VIE. Under PRC laws and regulations, PRC companies are subject to certain restrictions with respect to paying dividends or otherwise transferring any of their net assets to offshore entities. We would rely on the contractual arrangements with the VIE and its shareholders to operate the business. We do not have equity interests in such PRC subsidiaries but whose financial results would be consolidated into our consolidated financial statements in accordance with U.S. GAAP, due to the Company or its direct owned subsidiaries, i.e. the WFOE, and the Company s being the primary beneficiary of, such entity, for the accounting purposes. As such, in the event that we complete a business combination with a company in PRC, you would not hold equity in PRC operating companies. If we effect our initial business combination in a way that employs these types of control arrangements, we may have difficulty in enforcing our rights. Therefore, these contractual arrangements may not be as effective in providing us with the same economic benefits, accounting consolidation or control over a target business as would direct ownership. 7 Table of Contents If the target business or any other entity fails to perform its obligations under these contractual arrangements, we may incur substantial costs and expend substantial resources to enforce such arrangements, and rely on legal remedies under Chinese law. These remedies include seeking specific performance or injunctive relief and claiming damages, which we cannot assure will be sufficient to offset the cost of enforcement and may adversely affect the benefits we expect to receive from the business combination. If the government of the PRC finds that the agreements we entered into to acquire control of a target business through contractual arrangements with one or more operating businesses, or VIE Agreements do not comply with local governmental restrictions on foreign investment, or if these regulations or the interpretation of existing regulations change in the future, we could be subject to significant penalties or be forced to relinquish our interests in those operations or we could be unable to assert our contractual control rights over the assets of the post-combination target company, which could cause the value of our ordinary shares to depreciate significantly or become worthless. Additionally, the agreements associated with the VIE structure have not been tested in court of law in any jurisdiction. See Risk Factors If, due to restrictions on foreign investment in a target business, we have to acquire the business through the use of contractual arrangements and the PRC government determines that such contractual arrangements do not comply with foreign investment regulations, or if these regulations or the interpretation of existing regulations in the PRC change or new restrictive or prohibitive regulations come into force in the future, we could be subject to significant penalties or be forced to relinquish our interests in those operations. on page 74 and Risk Factors If the PRC government deems that the contractual arrangements in relation to the potential PRC Target Company, and the VIE, do not comply with PRC regulatory restrictions on foreign investment in the relevant industries, or if these regulations or the interpretation of existing regulations change in the future, we could be subject to severe penalties or be forced to relinquish our interests in those operations. on page 91. Government regulations relating to mergers and acquisitions We will initially face risks associated with structuring and completing a transaction to acquire a business in China that will comply with Chinese law. The Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors, or the M&A Rules, adopted by six PRC regulatory agencies in 2006 and amended in 2009, and other regulations and rules concerning mergers and acquisitions established additional procedures and requirements that could make merger and acquisition activities by foreign investors more time consuming and complex. The Anti-Monopoly Law of the PRC also requires that the MOFCOM be notified in advance of any concentration of undertaking if certain thresholds are triggered. Depending on the structure of the transaction, these M&A Regulations require the Chinese parties to make a series of applications and supplemental applications to one or more of the aforementioned agencies, some of which must be made within strict time limits and depending on approvals from one or the other of the aforementioned agencies. The application process has been supplemented to require the presentation of economic data concerning a transaction, including appraisals of the business to be acquired and evaluations of the acquirer which will permit the government to assess the economics of a transaction in addition to the compliance with legal requirements. If obtained, approvals will have expiration dates by which a transaction must be completed. Completed transactions must also be reported to the MOFCOM and some of the other agencies within a short period after closing or be subject to an unwinding of the transaction. In addition, the Circular of the General Office of the State Council on the Establishment of Security Review System for the Merger and Acquisition of Domestic Enterprises by Foreign Investors that became effective in March 2011, and the Rules on Implementation of Security Review System for the Merger and Acquisition of Domestic Enterprises by Foreign Investors issued by the MOFCOM that became effective in September 2011 specify that mergers and acquisitions by foreign investors that raise national defense and security concerns and mergers and acquisitions through which foreign investors may acquire de facto control over domestic enterprises that raise national security concerns are subject to strict review by the MOFCOM. The rules prohibit any activities attempting to bypass a security review, including by structuring the transaction through a proxy or contractual control arrangement. The scope of the review includes whether the acquisition will impact national security, economic and social stability, and research and development capabilities on key national security related technologies. Foreign investors should submit a security review application to the MOFCOM for its review of a contemplated acquisition. If the acquisition is considered within the scope of the security review regulations, the MOFCOM will transfer the application to a joint security review committee consisting of members from various PRC government agencies, for further review. 8 Table of Contents Complying with the requirements of the above-mentioned regulations and other relevant rules to complete acquisitions could be time consuming. Any required approval processes may delay or inhibit our ability to complete such transactions. We may also be prevented from pursuing certain investment opportunities if the PRC government considers that the potential investments will result in a significant national security issue. Until we consummate our business combination, we expect to retain legal experts in the PRC and the U.S. that are experienced with structuring offshore transactions with U.S. public companies. We plan to consult with PRC government officials when possible to assist us with complying with these structuring considerations and changing developments. Government regulations relating to foreign exchange controls In July 2014, SAFE promulgated the Circular on Relevant Issues Concerning Foreign Exchange Control on Domestic Residents Offshore Investment and Financing and Roundtrip Investment Through Special Purpose Vehicles, or SAFE Circular 37, to replace the Notice on Relevant Issues Concerning Foreign Exchange Administration for Domestic Residents Financing and Roundtrip Investment Through Offshore Special Purpose Vehicles, or SAFE Circular 75, which ceased to be effective upon the promulgation of SAFE Circular 37. SAFE Circular 37 requires PRC residents (including PRC individuals and PRC corporate entities) to register with SAFE or its local branches in connection with their direct or indirect offshore investment activities. SAFE Circular 37 applies to our shareholders who are PRC residents and may apply to any offshore acquisitions that we make in the future. Under SAFE Circular 37, PRC residents who make, or have prior to the implementation of SAFE Circular 37 made, direct or indirect investments in offshore special purpose vehicles, or SPVs, must register such investments with SAFE or its local branches. In addition, any PRC resident who is a direct or indirect shareholder of an SPV must update its filed registration with the local branch of SAFE with respect to that SPV, to reflect any material change. If our shareholders who are PRC residents or entities fail to make the required registration or to update the previously filed registration, any PRC subsidiaries may be prohibited from distributing their profits and any proceeds from any reduction in capital, share transfer or liquidation to us, and we may be restricted in our ability to contribute additional capital to any PRC subsidiaries. On January 13, 2015, SAFE promulgated a Notice on Further Simplifying and Improving Foreign Exchange Administration Policy on Direct Investment, or SAFE Notice 13, which became effective on June 1, 2015. Under SAFE Notice 13, applications for foreign exchange registration of inbound foreign direct investments and outbound overseas direct investments, including those required under SAFE Circular 37, will be filed with qualified banks instead of SAFE. The qualified banks will directly examine the applications and accept registrations under the supervision of SAFE. We have requested PRC residents who we know hold direct or indirect interests in us to make the necessary applications, filings and registrations as required under SAFE Circular 37. We believe that most of these shareholders have completed the initial foreign exchange registrations with relevant banks. However, these individuals may not continue to make required filings or updates in a timely manner, or at all. We may not know the identities of all PRC residents holding direct or indirect interests in our company. Any failure or inability by such individuals to comply with SAFE regulations may subject us to fines or legal sanctions, restrict our cross-border investment activities, and limit any PRC subsidiary s ability to distribute dividends to us. As a result, our business and our ability to make distributions to you could be materially adversely affected. Furthermore, as these foreign exchange regulations are still relatively new and their interpretation and implementation have been evolving, it is unclear how these regulations, and any future regulation concerning offshore or cross-border transactions, will be interpreted, amended and implemented by the relevant government authorities. For example, we may be subject to a more stringent review and approval process with respect to our foreign exchange activities, such as remittance of dividends and foreign-currency-denominated borrowings, which may adversely affect our financial condition and results of operations. If we acquire a PRC domestic company, we or the owners of such company, as the case may be, may not obtain the necessary approvals or complete the necessary filings and registrations required by the foreign exchange regulations. This may restrict our ability to implement our acquisition strategy and could adversely affect our business and prospects. 9 Table of Contents Government Regulations relating to Cybersecurity The PRC Criminal Law, as amended by its Amendment 7 (effective on February 28, 2009) and Amendment 9 (effective on November 1, 2015), prohibits institutions, companies and their employees from selling or otherwise illegally disclosing a citizen s personal information obtained in performing duties or providing services or obtaining such information through theft or other illegal ways. On November 7, 2016, the Standing Committee of the PRC National People s Congress, or the SCNPC, issued the Cyber Security Law of the PRC, or Cyber Security Law, which became effective on June 1, 2017. Pursuant to the Cyber Security Law, network operators must not, without users consent, collect their personal information, and may only collect users personal information necessary to provide their services. Providers are also obliged to provide security maintenance for their products and services and shall comply with provisions regarding the protection of personal information as stipulated under the relevant laws and regulations. The Civil Code of the PRC (issued by the PRC National People s Congress on May 28, 2020 and effective from January 1, 2021) provides legal basis for privacy and personal information infringement claims under the Chinese civil laws. PRC regulators, including the Cyberspace Administration of China, the Ministry of Industry and Information Technology, and the Ministry of Public Security, have been increasingly focused on regulation in data security and data protection. PRC regulatory requirements regarding cybersecurity are evolving. For instance, various regulatory bodies in China, including the Cyberspace Administration of China, the Ministry of Public Security and the State Administration for Market Regulation, have enforced data privacy and protection laws and regulations with varying and evolving standards and interpretations. In April 2020, the Chinese government promulgated Cybersecurity Review Measures, which came into effect on June 1, 2020. According to the Cybersecurity Review Measures, operators of critical information infrastructure must pass a cybersecurity review when purchasing network products and services which do or may affect national security. In July 2021, the Cyberspace Administration of China and other related authorities released the draft amendment to the Cybersecurity Review Measures for public comments through July 25, 2021. The draft amendment proposes the following key changes: companies who are engaged in data processing are also subject to the regulatory scope; the China Securities Regulatory Commission, or CSRC, is included as one of the regulatory authorities for purposes of jointly establishing the state cybersecurity review working mechanism; the operators (including both operators of critical information infrastructure and relevant parties who are engaged in data processing) holding more than one million users/users (which to be further specified) individual information and seeking a listing outside China shall file for cybersecurity review with the Cybersecurity Review Office; and the risks of core data, material data or large amounts of personal information being stolen, leaked, destroyed, damaged, illegally used or transmitted to overseas parties and the risks of critical information infrastructure, core data, material data or large amounts of personal information being influenced, controlled or used maliciously shall be collectively taken into consideration during the cybersecurity review process. If the draft amendment is adopted into law in the future, we may become subject to enhanced cybersecurity review. Certain internet platforms in China have been reportedly subject to heightened regulatory scrutiny in relation to cybersecurity matters. As of the date of this prospectus, we have not been informed by any PRC governmental authority of any requirement that we file for a cybersecurity review. However, if we or the combined company following a business combination are deemed to be a critical information infrastructure operator or a company that is engaged in data processing and holds personal information of more than one million users, we could be subject to PRC cybersecurity review. As there remains significant uncertainty in the interpretation and enforcement of relevant PRC cybersecurity laws and regulations, we or the combined company following a business combination could be subject to cybersecurity review, and if so, we may not be able to pass such review in relation to this offering or a business combination. Although we are not considering any PRC Target Company that may be deemed as an operator of 10 Table of Contents critical information infrastructure by the Cybersecurity Administration of China, or any PRC Target Company that possesses personal information of more than one million users that may involve in data (for example, mobile Internet companies), the proposed rules might still impact the timetable of our initial business combination and the certainty of our initial business combination and we may be unable to complete a business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination), if the PRC Target Company we have identified is subject to the final cybersecurity review measures. In addition, we could become subject to enhanced cybersecurity review or investigations launched by PRC regulators in the future. Any failure or delay in the completion of the cybersecurity review procedures or any other non-compliance with the related laws and regulations may result in fines or other penalties, including suspension of business, website closure, and revocation of prerequisite licenses, as well as reputational damage or legal proceedings or actions, which may have material adverse effect on our business, financial condition or results of operations. On June 10, 2021, the SCNPC promulgated the PRC Data Security Law, which will take effect in September 2021. The PRC Data Security Law imposes data security and privacy obligations on entities and individuals carrying out data activities, and introduces a data classification and hierarchical protection system based on the importance of data in economic and social development, and the degree of harm it will cause to national security, public interests, or legitimate rights and interests of individuals or organizations when such data is tampered with, destroyed, leaked, illegally acquired or used. The PRC Data Security Law also provides for a national security review procedure for data activities that may affect national security and imposes export restrictions on certain data and information. On August 20, 2021, the SCNPC adopted the Personal Information Property Law, which shall come into force as of November 1, 2021. The Personal Information Protection Law includes the basic rules for personal information processing, the rules for cross-border provision of personal information, the rights of individuals in personal information processing activities, the obligations of personal information processors, and the legal responsibilities for illegal collection, processing, and use of personal information. As uncertainties remain regarding the interpretation and implementation of these laws and regulations, we cannot assure you that we, or the combined company following a business combination, will comply with such regulations in all respects and we, or the combined company following a business combination, may be ordered to rectify or terminate any actions that are deemed illegal by regulatory authorities. We, or the combined company following a business combination, may also become subject to fines and/or other sanctions which may have material adverse effect on our business, operations and financial condition. While we take various measures to comply with all applicable data privacy and protection laws and regulations, our current security measures and those of our third-party service providers may not always be adequate for the protection of our company, employee or third party data. We may be a target for computer hackers, foreign governments or cyber terrorists in the future. Unauthorized access to our proprietary internal and third party data may be obtained through break-ins, sabotage, breach of our secure network by an unauthorized party, computer viruses, computer denial-of-service attacks, employee theft or misuse, breach of the security of the networks of our third party service providers, or other misconduct. Because the techniques used by computer programmers who may attempt to penetrate and sabotage our proprietary internal and third party data change frequently and may not be recognized until launched against a target, we may be unable to anticipate these techniques. Unauthorized access to our proprietary internal and third party data may also be obtained through inadequate use of security controls. Any of such incidents may harm our reputation and adversely affect our business and results of operations. In addition, we may be subject to negative publicity about our security and privacy policies, systems, or measurements. Any failure to prevent or mitigate security breaches, cyber-attacks or other unauthorized access to our systems or disclosure of third party data, including their personal information, could result in loss or misuse of such data, interruptions to our service system, loss of confidence and trust in our company, impairment of our technology infrastructure, and harm our reputation and business, resulting in significant legal and financial exposure and potential lawsuits. 11 Table of Contents Transfers of Cash to and from our Potential VIE (Post Business Combination) Energy Cloud I Acquisition Corporation is a holding company with no operations of its own. Although we do not have any specific business combination under consideration and we have not (nor has anyone on our behalf), directly or indirectly, contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to such a transaction, our initial business combination target company may include a PRC Target Company which might require a VIE structure. As such, we may be required to conduct our operations in China primarily through our subsidiary and VIE in China. As a result, although other means are available for us to obtain financing at the holding company level, the Company s ability to pay dividends to its shareholders and to service any debt it may incur may depend upon dividends paid by our PRC Target Company s subsidiaries. If any of our subsidiaries incur debt on its own in the future, the instruments governing such debt may restrict its ability to pay dividends or make other payments to Energy Cloud I Acquisition Corporation. In addition, our PRC Target Company s subsidiaries and VIE are required to make appropriations to certain statutory reserve funds, which are not distributable as cash dividends except in the event of a solvent liquidation of the companies. To the extent that a VIE structure is utilized due to restrictions of foreign investment in the target s industry, the PRC subsidiaries may subsequently provide funds to the VIE through extending loans subject to statutory limits and restrictions. After the business combination, we may rely on dividends and other distributions from our operating company to provide us with cash flow and to meet our other obligations. The combined company s ability to pay dividends, if any, to the shareholders and to service any debt it may incur will depend upon dividends paid by its PRC subsidiaries which are entitled to substantially all of the economic benefits of the VIE. Under PRC laws and regulations, PRC companies are subject to certain restrictions with respect to paying dividends or otherwise transferring any of their net assets to offshore entities. In particular, under the current PRC laws and regulations, dividends may be paid only out of distributable profits. Distributable profits are the net profit as determined under Chinese accounting standards and regulations, less any recovery of accumulated losses and appropriations to statutory and other reserves required to be made. To the extent that a VIE structure is utilized, cash is transferred through our organization in the manner as follows: (i) the holding company may transfer funds to its subsidiaries, or intermediate holding companies, via additional capital contributions or shareholder loans, as the case may be; (ii) the intermediate holding companies may provide loans to the VIE, subject to statutory limits and restrictions; (iii) funds from the VIE to the intermediate holding companies are remitted as services fees; and (iv) the intermediate holding companies may make dividends or other distributions to the holding company. As of the date of this prospectus, since we have not identified any target for an initial business combination, we have not made any dividends or distributions to our shareholders arising from any VIE structure or agreement. In the event that our PRC Target Company requires a VIE structure, the Company does not intend to distribute earnings or settle amounts owed under any VIE Agreements. Current PRC regulations permit the PRC Target Company s indirect PRC subsidiaries to pay dividends to an overseas subsidiary, for example, a subsidiary located in Hong Kong, only out of their accumulated profits, if any, determined in accordance with Chinese accounting standards and regulations. Under existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior approval of the State Administration for Foreign Exchange, or SAFE, by complying with certain procedural requirements. Specifically, under the existing exchange restrictions, without prior approval of SAFE, cash generated from the operations of our PRC Target Company s subsidiaries may be used to pay dividends to us. In addition, each of the PRC Target Company s subsidiaries in China is required to set aside at least 10% of its after-tax profits each year, if any, to fund a statutory reserve until such reserve reaches 50% of its registered capital. Each such entity in China is also required to further set aside a portion of its after-tax profits to fund the employee welfare fund, although the amount to be set aside, if any, is determined at the discretion of its board of directors. Although the statutory reserves can be used, among other ways, to increase the registered capital and eliminate future losses in excess of retained earnings of the respective companies, the reserve funds are not distributable as cash dividends except in the event of liquidation. The PRC government also imposes controls on the conversion of the Renminbi ( RMB ), the legal currency of the PRC, into foreign currencies and the remittance of currencies out of the PRC. Therefore, we may experience difficulties in completing the administrative procedures necessary to obtain and remit foreign currency for the payment of dividends from our profits, if any. Furthermore, if the PRC Target Company s subsidiaries in the PRC 12 Table of Contents incur debt on their own in the future, the instruments governing the debt may restrict their ability to pay dividends or make other payments. If we or the PRC Target Company and its subsidiaries are unable to receive all of the revenues from their operations through the VIE agreements, we may be unable to pay dividends on our ordinary shares. If we acquire a target company that operates its business in the PRC through VIE contractual arrangements, investors in our ordinary shares following a business combination would not hold equity interests in operating companies domiciled in PRC under our control and would hold equity interests in a British Virginal Islands holding company. We would rely on the contractual arrangements with the VIE subsidiaries and its shareholders to operate the business. We do not have equity interests in such PRC operating companies but whose financial results would be consolidated into our consolidated financial statements in accordance with U.S. GAAP, due to we or our direct owned subsidiaries in PRC, i.e. the wholly foreign-owned enterprise, or WFOE, and the Company s being the primary beneficiary of, such entity, for accounting purposes. You will not directly hold equity interests in PRC operating companies. Additionally, the agreements associated with the VIE structure have not been tested in court of law in any jurisdiction. Cash dividends, if any, on our ordinary shares will be paid in U.S. dollars. If we are considered a PRC tax resident enterprise for tax purposes, any dividends we pay to our overseas shareholders may be regarded as China-sourced income and as a result may be subject to PRC withholding tax at a rate of up to 10.0%. In order for us to pay dividends to our shareholders, we may rely on payments made from the VIE to the wholly foreign-owned enterprise, or WFOE, pursuant to VIE agreements between them, and the distribution of such payments to our overseas subsidiary as dividends from WFOE. Certain payments from the VIE to WFOE are subject to PRC taxes, including business taxes and value-added tax, or VAT. If we enter into a business combination with a target business operating in China under a VIE structure, we may, in the future, intend to distribute earnings or settle amounts owed under such VIE agreements to the PRC Target Company s subsidiaries, for the PRC subsidiaries business operation grow purpose, through capital contributions or shareholder s loans. The PRC government may take measures at its discretion from time to time to restrict access to foreign currencies for current account or capital account transactions. If the foreign exchange control regulations prevent the PRC subsidiaries of the combined company from obtaining sufficient foreign currencies to satisfy their foreign currency demands, the PRC subsidiaries of the combined company may not be able to pay dividends or repay loans in foreign currencies to their offshore intermediary holding companies and ultimately to the combined company. We cannot assure you that new regulations or policies will not be promulgated in the future, which may further restrict the remittance of RMB into or out of the PRC. We cannot assure you, in light of the restrictions in place, or any amendment to be made from time to time, that the PRC subsidiaries of the combined company will be able to satisfy their respective payment obligations that are denominated in foreign currencies, including the remittance of dividends outside of the PRC. See Risk Factors Risks Associated with Acquiring and Operating a Business Outside of the United States PRC regulations relating to the establishment of offshore special purpose companies by PRC residents may subject our PRC resident beneficial owners or any future PRC subsidiaries to liability or penalties, limit our ability to inject capital into any PRC subsidiaries, limit any PRC subsidiary s ability to increase its registered capital or distribute profits to us, or may otherwise adversely affect us. For more detailed description of how cash will be transferred through the post-combination organization if we acquire a PRC Target Company, see Risk Factors Cash-Flow Structure of a Post-Acquisition Company Based in China or Hong Kong. on page 84. For more detailed description on any restrictions on foreign exchange and our ability to transfer cash to our U.S. investors that may apply after a business combination with PRC Target Company, see Risk Factors Should we choose to acquire a company in China, exchange controls that exist in the PRC may restrict or prevent us from using the proceeds of this offering to acquire a target company in PRC and limit our ability to utilize our cash flow effectively following our initial business combination. on page 81. Holding Foreign Company Accountable Act On March 24, 2021, the SEC adopted interim final rules relating to the implementation of certain disclosure and documentation requirements of the HFCAA. An identified issuer will be required to comply with these rules if the SEC identifies it as having a non-inspection year under a process to be subsequently established by the SEC. In June 2021, the Senate passed the Accelerating Holding Foreign Companies Accountable Act, which, if signed into law, would reduce the time period for the delisting of foreign companies under the HFCAA to two consecutive years 13 Table of Contents instead of three years. If our auditor cannot be inspected by the Public Company Accounting Oversight Board, or the PCAOB, for two consecutive years, the trading of our securities on any U.S. national securities exchanges, as well as any over-the-counter trading in the U.S., will be prohibited. On September 22, 2021, the PCAOB adopted a final rule implementing the HFCAA, which provides a framework for the PCAOB to use when determining, as contemplated under the HFCAA, whether the PCAOB is unable to inspect or investigate completely registered public accounting firms located in a foreign jurisdiction because of a position taken by one or more authorities in that jurisdiction. On December 2, 2021, the SEC issued amendments to finalize rules implementing the submission and disclosure requirements in the HFCAA. The rules apply to registrants that the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located in a foreign jurisdiction and that PCAOB is unable to inspect or investigate completely because of a position taken by an authority in foreign jurisdictions. On December 16, 2021, the PCAOB issued a report on its determinations that it is unable to inspect or investigate completely PCAOB-registered public accounting firms headquartered in mainland China and in Hong Kong, because of positions taken by PRC authorities in those jurisdictions. Our auditor, B F Borgers CPA PC, the independent registered public accounting firm of the Company, is headquartered in Lakewood, Colorado, with no branches or offices outside of the United States. B F Borgers CPA PC is currently subject to Public Company Accounting Oversight Board ( PCAOB ) inspections under a regular basis. Therefore, we believe our auditor is not subject to the determinations as to the inability to inspect or investigate registered firms completely announced by the PCAOB on December 16, 2021. However, as more stringent criteria have been imposed by the SEC and the PCAOB, recently, which would add uncertainties to our offering, and we cannot assure you whether Nasdaq or regulatory authorities would apply additional and more stringent criteria to us after considering the effectiveness of our auditor s audit procedures and quality control procedures, adequacy of personnel and training, or sufficiency of resources, geographic reach or experience as it relates to the audit of our financial statements. See U.S. laws and regulations, including the Holding Foreign Companies Accountable Act, may restrict or eliminate our ability to complete a business combination with certain companies, particularly those acquisition candidates with substantial operations in China. on page 96. Emerging Growth Company Status and Other Information We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We intend to remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our ordinary shares that are held by non-affiliates exceeds $700 million as of the prior May 31, and; (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act. 14 Table of Contents We are currently a foreign private issuer, or a FPI as defined in Rule 405 of the Securities Act, but are voluntarily choosing to register and report using domestic forms. As a FPI, we are required to conduct redemptions in connection with a tender offer rather than a proxy solicitation. We are required to determine our status as a FPI for the 2021 fiscal year as of the last day of our second quarter, or June 30, 2022. On such date, if we no longer qualify as a FPI, we will then become subject to the U.S. domestic issuer rules as of the first day of our 2023 fiscal year, or January 1, 2023. As a result, should we determine on June 30, 2022 that we are no longer a FPI, we will be subject to the U.S. domestic issuer rules after December 31, 2022 and we will have the option of conducting redemptions like other blank check companies in conjunction with a proxy solicitation pursuant to the proxy rules or pursuant to the tender offer rules. We expect that we will no longer qualify as a FPI as of June 30, 2022, assuming this offering closes in advance of such date. Corporate Information Our executive offices are located at Room 2006, Block 5, Zone 5, Aoyuan City Plaza, Panyu District, Guangzhou, China and our telephone number is +86 13676064350. 15 Table of Contents
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+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus. It does not contain all of the information that may be important to you and your investment decision. Before investing in our common stock, you should carefully read this entire prospectus, including the matters set forth under the sections of this prospectus captioned Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations and our consolidated financial statements and related notes included elsewhere in this prospectus. Unless the context otherwise requires, the terms Specialty Building Products, the Company, our company, we, us and our in this prospectus refer to SBP Predecessor (and, where appropriate, its consolidated subsidiaries), for periods prior to the closing date of the TJC Acquisition, and to Specialty Building Products, Inc. (and, where appropriate, its consolidated subsidiaries, including SBP Predecessor), for periods beginning on and after the closing date of the TJC Acquisition. Please see Basis of Presentation in the forepart of this prospectus. Our Company We believe we are the largest and fastest growing distributor of branded specialty building products in the United States. Since 2010, we have grown revenues at an approximate compound annual growth rate ( CAGR ) of 28.6% and transformed our business into a national distribution platform with 38 locations serving 42 states and all provinces in Canada. We serve a critical role and function in the residential building products supply chain and provide value-added services across our footprint. We focus on high growth, specialty product categories including composite decking and railing, exterior siding, exterior trim, weather resistant barriers, moulding, specialty doors and engineered wood products, and many of our products are benefiting from long-term secular growth trends such as investment in outdoor living spaces, material substitution and architectural design. Our products are primarily used in the residential housing market, with balanced exposure across repair and remodel ( R&R ) and new construction markets. As of January 2, 2022, we offered our comprehensive portfolio of over 50,000 stock keeping units ( SKUs ) to more than 24,000 customer locations including national, regional and local professional dealers, home improvement retailers and other providers of building products. Our suppliers include many of the leading consumer and trade branded products in the building products industry. Based on management estimates, we believe we are nearly three times the size of our largest competitor. In addition, we are a values-based organization and have a well-established reputation in the industry. We serve as a critical link in the building products supply chain, connecting over 400 suppliers to more than 24,000 customer locations. Over our history, we have developed strong, trusted relationships with our customers and suppliers as a result of our ability to navigate complex supply chains, which often consist of high SKU counts, long lead times, large minimum order quantities, and just-in-time delivery requirements of bulky and cumbersome items. We have leveraged our scale, market leadership, and geographic and customer reach to secure distribution rights for products from many leading suppliers. In pro forma fiscal year 2021, approximately 84% of our sales were from products for which we had formal or practical exclusivity. This includes suppliers with leading consumer brands such as Trex, LP SmartSide and James Hardie, where we have established leading share positions across many of our markets. We believe we are the largest supplier of Trex composite decking and railing and LP SmartSide products in the geographic markets in which we operate. Since we established our relationship with Louisiana Pacific in 2017, we have grown our LP SmartSide net sales at a CAGR of approximately 177%, from approximately $4 million in 2017 to approximately $209 million in 2021. Our growing partnership with Trex is an example of the strength of our service offering, geographic breadth, and customer reach as we have displaced under-performing competitors in a broad distribution territory. As a result, from 2017 to 2021, our net sales attributable to Trex products increased at a CAGR of approximately 36%, from approximately $98 million in 2017 to approximately $339 million in 2021, and we believe we have significant runway for future growth. Table of Contents Table of Contents We believe our longstanding commitment to developing strategic relationships with suppliers, broad offering of high-value products that are readily available, differentiated technical expertise, superior customer service and value-added services have enabled us to significantly grow our market and wallet share within our customer base. In addition, we have bolstered our customer relationships with our extensive field service organization, managing product assortment, inventory levels and merchandising for select customers and product categories. We believe we have significant opportunity to further expand our market leadership, product offering, geographic footprint and customer and supplier base. The depiction below illustrates our compelling value proposition for both suppliers and customers. As we have expanded our business throughout North America, we have made significant investments in our operating infrastructure with leading technology systems that are highly scalable. We integrate proprietary data collection, warehousing and analytics with customized business intelligence systems across our footprint. Our proprietary systems allow us to see the gross margin, operating expense, and income characteristics of transactions and even line items within transactions in real time. Rolling up this data using our technology toolset allows us unique insight into relative profitability of customers, products and services. This allows us to continually optimize our business across North America and at the local level, where our branch managers are empowered by these systems to make locally-optimized pricing, service level, and sales force decisions. We believe all of this enables us to intentionally design the business for enhanced profitable growth by providing our corporate and field management with clarity on the drivers of our profitability. We also believe our investment in technology is a key differentiator and a significant competitive advantage for us as we are able to provide our suppliers with unique insights into their product performance in various markets and also partner with our customers to optimize the timing, quantity, and frequency of their purchases. Moreover, we have equipped our sales force with mobile tools to serve our customers more quickly and efficiently, and we have created customer-facing on-line tools for merchandising our products. Our technology and commitment to the use of data empowers decision-making at every level and, we believe, provides us with strong and scalable foundation for growth and long-term competitive advantages in our industry. We focus on high-value, high-margin products, many of which are growing faster than the overall market by partnering with premier brands. Our product breadth and expansive geographic presence across North America Table of Contents Table of Contents allows us to serve as a one-stop-shop for national, regional and local customers. We offer a comprehensive selection of more than 50,000 SKUs across a variety of categories including exterior siding, trim, and finish products, moulding and millwork products, composite decking and railing products, specialty doors, interior finish products and engineered wood products, among others. The table below provides a summary overview of our key product categories. We have a diverse sales mix across our product categories, customers, end markets and geographies. During pro forma fiscal year 2021, we derived approximately 47% of our net sales from local / independent professional dealers, 24% from national professional dealers, 12% from home improvement retailers, 10% from original equipment manufacturers ( OEMs ) and 7% from roofing distributors. Importantly, we have balanced exposure to both the R&R and new construction end markets, with approximately 46% of net sales attributable to R&R-based activity, and approximately 43% of net sales attributable to new construction. We expect that our end markets will continue to grow as a result of limited housing supply, low interest rates, rising home equity levels and a large installed base of aging homes in need of refurbishment. In addition, many of the products we sell are well positioned to benefit from favorable long-term demand trends driven by continued consumer investments in outdoor and indoor living spaces and material conversion as consumers increasingly prefer sustainable, low-maintenance building materials over traditional building materials. The charts below illustrate our net sales by product, customer type and end market. Table of Contents Table of Contents We are a values-based organization built around a core commitment to do the right thing; even when it is hard. We highly value all of our stakeholders: our customers, suppliers, employees, investors, and the communities in which we operate. We are committed to the core value of using our influence to have a uniquely positive impact on the people that we touch. In furtherance of these values, we are focused on sustainability and have implemented several initiatives to reduce our impact on the environment. We partner with leading consumer brands of specialty building products such as Trex and James Hardie who are committed to conservation, diverting waste from landfills and reducing their carbon footprint as they develop durable products primarily from recycled materials. Our sales force works to educate consumers about the benefits of sustainable specialty building products in an effort to accelerate the adoption of these products. Our wood-based products are sourced from suppliers such as ARAUCO and Louisiana Pacific, who only engage in certified Sustainable Forestry practices. ARAUCO has become the first certified carbon neutral forestry company in the world as a result of its responsible management of forests and plantations. The sustainable management of timber plantations reduces the impact of deforestation on natural forests and increases the capture of carbon dioxide. We leverage our business intelligence systems to not only assist in profitability growth, but also help us drive efficiency and sustainability throughout our organization. We are focused on Environmental, Social & Governance ( ESG ) matters by living our values and prioritizing employee wellness, as well as being committed to sourcing environmentally friendly products, reducing waste, and improving productivity across our operations. We are a leading consolidator within the specialty building products distribution industry. We have completed eight acquisitions since 2016, and we believe we have a strong pipeline of future acquisition opportunities to further complement our existing business and expand our growth. Our organic and acquisition-driven growth strategies have led to significant increases in net sales and Adjusted EBITDA. For pro forma fiscal year 2021, we generated net sales, net income and Adjusted EBITDA of $2,699 million, $95 million and $308 million, respectively. When comparing fiscal year 2019, fiscal year 2020 and pro forma fiscal year 2021, net sales and Adjusted EBITDA increased at a CAGR of 39.4% and 94.6%, respectively. For discussion of our use of Adjusted EBITDA and reconciliation to net income, the most directly comparable GAAP metric, please refer to Management s Discussion and Analysis of Financial Condition and Results of Operations . The charts below show our net sales and net sales growth, net income and net income margin, and Adjusted EBITDA and Adjusted EBITDA margin for fiscal year 2019, fiscal year 2020 and pro forma fiscal year 2021. Our Industry Our products are widely used across several large, attractive markets within the North American residential housing industry. We serve the specialty building products market, which we define as the market for exterior siding, composite decking and railing, trim and finish, moulding and millwork, specialty doors, interior finish, engineered wood systems, and other specialty building products. Table of Contents We expect the overall North American housing industry will continue to benefit from strong secular growth drivers, including the structural undersupply of new homes, aging housing stock, shifting demographics, and evolving consumer preferences. Within the specialty building products market, there are a number of compelling secular growth trends that are driving above average growth across our product categories, including outdoor living, material substitution and the Home Fortress mentality, which refers to the increased focus and demand for advanced architectural and design elements, and trends towards craftsman and farmhouse-style homes. As the largest distributor of specialty building products in North America according to Principia, we believe our product portfolio is well positioned to benefit from these trends and deliver above average growth in each of our core product categories as we have done historically. The vast majority of our product categories serve the residential R&R and new construction end-markets, and include exterior siding, trim and finish, moulding and millwork, composite decking and railing, specialty doors, interior finish, engineered wood systems, and other specialty building products. Principia estimates our total addressable demand in these markets to be approximately $69 billion annually. Based on data provided by Principia, the total annual demand for our key product categories increased at a 18.1% CAGR from fiscal years 2019 to 2021 and is expected to grow at a 5.2% CAGR from fiscal years 2021 to 2023, reaching $76 billion by fiscal year 2023. We believe that our product offerings position us within the highest growth segments of each of our product categories, where our products benefit the most from the key secular growth trends referenced above. We have diversified end market exposure within the residential housing industry and across the specialty building products market. The vast majority of our sales are generated by activity in the R&R and new construction end markets, of which contribution to total net sales for pro forma fiscal year 2021 was $1,235 million, or 45.8% of total net sales, and $1,170 million, or 43.4%, respectively. Both the R&R market and new construction market accelerated since 2019 and each are expected to continue to grow as a result of favorable demographic trends, limited inventory, aging housing stock, shifting consumer preferences, low interest rates and record home equity. A substantially smaller portion of our sales comes from activity in the multi-family and OEM end markets, where contribution to total net sales for pro forma fiscal year 2021 was $294 million, or 10.9% of total net sales. Based on data from the National Association of Home Builders, there were approximately 1.6 million total annual housing starts in the United States in 2021, an increase of 16% from 2020. According to the Rosen Consulting Group, in a study using data from the U.S. Census Bureau and the National Association of Home Builders, the U.S. housing sector is currently undersupplied by approximately 5.5 million homes. The study estimates that U.S. housing starts would need to accelerate to more than 2 million housing units per year over the next 10 years in order to balance demand. This represents an increase of more than 700,000 units per year (or approximately 60%) relative to the pace of housing production in 2020. As such, we expect residential new construction demand to remain strong over the long term. In addition, while 2021 has been a strong year in the Table of Contents market, there have been a number of limiting factors that have constrained growth, including industry-wide supply shortages and disruptions, labor constraints and price fluctuations. We believe these factors have led to above-average backlog which gives us confidence in strong continued growth and demand for our products for the foreseeable future. The U.S. Census Bureau estimated the median home age in the United States of 41 years in 2019, an increase of 41% since 2000. According to estimates from the Home Improvement Research Institute annual spend on the home improvement and products market was approximately $460 billion in 2020, and this figure is expected to grow at an approximate CAGR of 5.6% over the next four years to approximately $570 billion in 2024. We expect that aging housing stock, low interest costs, rising home prices and associated increases in underlying home equity will continue to drive strong demand for R&R projects. Near-term multi-family starts are expected to be influenced by shifting consumer preferences and higher vacancies in metropolitan centers borne by the COVID-19 pandemic. According to the National Association of Home Builders, multi-family construction starts are expected to reach approximately 500,000 units in 2022, growing at a 12.9% CAGR since 2020. We believe we are well positioned to benefit from favorable and accelerating secular growth trends in our markets and across our product categories. These trends include materials substitution, outdoor living, and the Home Fortress mentality. We expect further penetration by composite products across our product categories as advances in materials science improve product quality, affordability and design optionality for our customers. For example, according to Principia, the composite decking market grew at an attractive 15.5% CAGR from 2019 to 2021, increasing its penetration of the broader decking market from 20.6% in 2019 to 23.2% in 2021. We believe there is substantial opportunity for further penetration of composite products across our decking, railing and exterior siding, trim and finish categories as shown below. The COVID-19 pandemic has resulted in people spending extended amounts of time at home, which has served to accelerate repair and remodel spend. We believe hybrid work models will continue to drive spending inside and outside the home, benefitting all of our product categories, including composite decking and railing, exterior siding, moulding and millwork, and trim and finish. We believe the outdoor living market is currently growing at approximately twice the rate of the broader repair and remodel market. This is a trend that is expected to continue long-term, particularly as homeowners choose to spend more leisure time outdoors and an increasing number of Millennials enter the housing market. Inside the home, repair and remodel activity is increasingly Table of Contents influenced by design trends and the Home Fortress mentality, where we are seeing a shift in consumer preferences driving higher demand for advanced architectural and design elements, including craftsman and farmhouse-style homes. These trends benefit our interior finish and moulding product categories, in particular. Our Competitive Strengths Leading Distribution Platform in Specialty Building Products We are a leading distributor of specialty building products and have built an expansive geographic footprint across a highly fragmented market. We believe we have established leading market share positions in all of our products. In addition, we are a leader in all geographic markets we serve, enabling us to strengthen long-term relationships with our customers and suppliers. We believe we have cultivated the industry s largest and broadest portfolio of high-growth, high-margin branded products benefiting from secular growth trends including outdoor living, material conversion, and the Home Fortress mentality. Our scaled North American platform combined with our knowledge of local markets positions us as the preferred strategic growth partner for our suppliers as approximately 84% of our sales are from products where we have formal or practical exclusivity. In addition, our scale and leadership position across an extensive geographic and customer footprint provides us with access to premier consumer and trade brands that are well-recognized by customers for their high quality, unique aesthetic designs and superior performance. We have leveraged these capabilities to develop meaningful partnerships with Trex, James Hardie, LP SmartSide, and Therma-Tru, as well as others. For example, we increased net sales attributable to James Hardie products from approximately $7 million in 2017 to approximately $87 million in 2021, representing a CAGR of approximately 87%. We believe our significant scale, national reach and differentiated service capability position us to drive significant organic growth by expanding and strengthening our relationships with key suppliers, introducing new specialty products and increasing share with existing customers. Broad Product Portfolio of Leading Brands across Large, High Growth Categories Benefiting from Long-Term Industry Tailwinds We believe we offer the industry s most comprehensive portfolio of high growth specialty building products that are benefiting from significant above-market growth as a result of structural, sustainable shifts in the market. With over 50,000 SKUs from more than 400 suppliers, our broad product offering creates a one-stop shop for customers and provides unique access to premier consumer and trade brands such as ARAUCO, James Hardie, LP SmartSide, Trex and Royal Group, among others. This comprehensive product portfolio provides a significant competitive advantage given our ability to fulfill demand for a diverse set of highly customized products across our footprint. Our products are benefitting from favorable supply and demand fundamentals such as a limited housing supply, low interest rates, rising home equity levels and a large installed base of aging homes in need of refurbishment. In addition, many of the products we supply are benefiting from secular growth trends such as outdoor living, material conversion, and the Home Fortress mentality. Outdoor living-related products are growing twice as fast as the overall R&R market given increasing consumer investment in outdoor living spaces. In addition, improving technology and material science capabilities of our suppliers have enhanced the quality, aesthetics and performance of materials such as composite decking and railing, polyvinyl chloride ( PVC ) and composite exterior trim, fiber cement and composite siding, composite mouldings and engineered wood systems. We believe we are the largest supplier of Trex composite decking and railing in the markets in which we operate. We believe there is a significant opportunity for further market penetration by these composite products. For example, composite decking represented approximately 23% of the decking market, in terms of linear feet sold in 2021, and is estimated to grow to approximately 50% of the market over time, according to The AZEK Company. We believe our product categories present substantial growth opportunities in the coming years and that our leading scale, comprehensive portfolio and strategic supplier relationships position us to capitalize on these highly attractive markets. Table of Contents Critical Supply Chain Partner Delivering Compelling Value Proposition to Customers and Suppliers We play an essential role in the supply chain for rapidly growing specialty building products, connecting a diverse set of leading suppliers to a highly fragmented customer base, and serving more than 24,000 unique customer locations. Over time, we have developed long-term relationships with our suppliers and customers to become a trusted partner for products that are high SKU count, have long lead times and exhibit low turnover. Our suppliers value our local market knowledge and extensive sales force as well as our ability to distribute their products to fragmented markets, provide timely delivery in job-lot quantities and offer value-added services. As a result, we are able to benefit from strategic supplier agreements, favorable access to selected product lines and greater product availability. For example, in most markets, we are one of only two distributors contracted by leading suppliers such as Trex and James Hardie, as well as others to distribute their products. In pro forma fiscal year 2021, approximately 84% of our net sales were from products with formal or practical exclusivity. Our customers rely on us for our product breadth and availability, knowledgeable sales force and technical expertise as well as our purchasing scale, just-in-time delivery capability, and value-added services such as remanufacturing and pre-finishing. We also have an extensive field service organization serving home improvement retailer locations, where we are responsible for managing product assortment, inventory levels, and merchandising for selected product categories. For example, we have over 500 people managing the moulding aisle for more than 800 Home Depot locations. We believe our combined capabilities for both suppliers and customers provide us with significant and sustainable competitive advantages relative to smaller, local players. Highly Scalable Platform Leveraging Proprietary Technology and Data Analytics to Drive Profitable Growth We have invested significant resources into building a highly scalable operating infrastructure with advanced technology systems that we believe are best-in-class amongst specialty building products distributors. With all of our branches operating under a common information technology architecture, we empower local, real-time decision-making and enhance visibility across the platform to better understand the key drivers of growth and profitability. Our proprietary data warehouse and business intelligence systems allow us to see the gross margin, operating expense, and income characteristics of a large majority of our transactions, enabling us to analyze relative profitability for each customer and product. These key insights enable our corporate and local management teams to make informed business decisions that drive our product mix, pricing, inventory management, and growth strategies. As a result, we have been able to deliver consistent top line growth, significantly reduce our overhead expense, based on a percentage of net sales, and expand our net income and Adjusted EBITDA margins by approximately 450 and 560 basis points, respectively, when comparing fiscal year 2019, fiscal year 2020 and pro forma fiscal year 2021. We believe investing in technology provides us with a long-term competitive advantage in our industry, enhances our supplier and customer relationships, and affords us a strong foundation for future growth. Attractive and Resilient Financial Profile Over the past decade, we have built our platform into one of the largest distributors of specialty building products in North America, growing sales and Adjusted EBITDA every year, with increasing profitability. Since fiscal year 2019, we have increased our net sales at a CAGR of 24.8%, growing faster than our underlying markets, primarily driven by our strategic focus on products benefiting from secular growth tailwinds, proliferation of our products throughout our network, expansion into new geographies and contribution from accretive acquisitions. Furthermore, our Adjusted EBITDA increased at a 56.6% CAGR over the same period, benefiting from increased sales, product category expansion, operating expense efficiencies and synergies. We believe the diversified nature of our product categories, customer base, geographic footprint and end markets provides increased stability for our business relative to smaller, regionally- or locally-focused distributors. In pro forma fiscal year 2021, the largest concentration of our net sales was attributable to R&R activity, which is generally less cyclical than new construction. In addition, our branded specialty building products exhibit greater price stability when compared to commodity building products such as lumber, plywood and particleboard. On a Table of Contents quarterly basis for fiscal year 2019, fiscal year 2020 and pro forma fiscal year 2021, the average pricing volatility for our products was approximately 3%, whereas the Random Lengths Index average price volatility was approximately 32%, according to RISI Inc. In pro forma fiscal year 2021, we estimate that our earnings were favorably impacted by a transitory pricing benefit of approximately $38 million. Our attractive margins, efficient working capital management and minimal capital expenditure requirements enable us to generate significant positive cash flow. We believe our attractive financial profile and resilient business model provides us with significant financial flexibility to repay debt, reinvest in our business and fund strategic acquisitions, and will ultimately enable us to drive long-term shareholder value creation. Proven Ability to Identify, Execute and Integrate Accretive Acquisitions We believe we are the leading consolidator of specialty building products distributors that is focused on large, attractive and highly fragmented markets. Our management team has extensive experience utilizing a disciplined approach to identify, execute and integrate acquisitions, while maintaining an active pipeline of attractive consolidation opportunities across multiple product categories and geographies. We believe our industry leadership position, geographic footprint, strong reputation and values-based culture positions us as an acquirer-of-choice in our industry and allows us to achieve attractive multiples in our acquisitions. Since 2016, we have successfully completed eight strategic acquisitions, representing, in the aggregate, approximately $1.8 billion of LTM sales. We believe our recent acquisitions have strengthened our market position in several product categories and geographies, and also expanded our product offering into new categories. We believe we are a highly effective consolidation platform enhancing the operations of acquired companies by integrating them into our operating infrastructure and technology systems, while also realizing synergies from sales initiatives, procurement optimization, branch consolidation, overhead cost reductions and improved working capital management. For example, we were able to achieve significant synergies through our acquisition of Midwest Lumber Minnesota, Inc ( Midwest Lumber ) in 2018 by leveraging our new expanded footprint to win Louisiana Pacific s Smart Side business as well as converting existing Midwest Lumber locations to supply Trex products. These changes increased our net sales attributable to Midwest Lumber at a CAGR of approximately 37% from fiscal years 2018 to 2021. We expect the execution of synergistic acquisitions to continue to be an integral part of our growth strategy. Experienced and Values-Based Management Team with Strong Track Record of Execution We believe our management team is among the most experienced in the industry, and is supported by a deep bench of branch managers with significant operational expertise, extensive customer and supplier relationships, and a proven ability to execute growth strategies across economic cycles. Our senior management team, consisting of our President and Chief Executive Officer, Jeff McLendon, our Chief Financial Officer Ronnie Stroud, our Chief Operating Officer Bryan Lovingood and our Chief Commercial Officer, Carl McKenzie, has over 75 years of combined experience, and their continuity of leadership has provided both stability and a clear long-term vision for us for almost 20 years. Under their leadership, we have entered into new product categories and geographic markets, instilled a strong, values-based collaborative culture, and attracted and developed industry-leading talent, all while expanding the business from approximately $200 million in net sales in fiscal year 2010 to approximately $2.7 billion in net sales in pro forma fiscal year 2021. Additionally, the number of locations at year-end increased from seven in fiscal year 2010 to 38 in fiscal year 2021. Although our business has scaled rapidly, both organically and through strategic acquisitions, our culture and values remain core to our business. We value all of our stakeholders and we are committed to the core value of using our influence to have a uniquely positive impact on the people that we touch. Through Company-led initiatives such as Thrive and Serve, we encourage our employees to prioritize personal wellness and to better serve our communities and the people we directly influence. Further, our commitment to sustainability permeates our organization as we have adopted several strategies to reduce our impact on the environment. We partner with the leading consumer brands of specialty building products such as Trex and James Hardie who are committed to preserving natural Table of Contents resources as they develop long-lasting products from recycled materials. Our wood-based products are sourced from suppliers such as ARAUCO and Louisiana Pacific, who only engage in certified Sustainable Forestry practices. We believe the combination of our consistent strategic vision, leading market position and unique values-based culture, will allow us to continue to attract and develop high-performing talent critical to our success. Our Strategies We intend to leverage our competitive strengths to deliver profitable, above-market growth and create shareholder value through the following core strategies: Integrate our Full Product Suite Across our Network Our approach to driving proliferation of our product portfolio across our footprint is two-fold: (i) cross-sell existing products into acquired markets; and (ii) cross-sell new products through existing markets. (i) Cross-sell existing products into acquired markets Our broad portfolio of leading brands enables us to leverage our network and cross-sell our existing products through newly added markets. Typically, new markets are added through acquisition and there is a significant opportunity to broaden our product offering within the newly acquired local market. Often our existing products are complementary, have significant customer and channel overlap, and strengthen our value proposition for customers and suppliers in the region. For example, subsequent to the opening of our Minneapolis branch through the acquisition of Midwest Lumber in 2018, we were successfully able to introduce LP SmartSide and Trex branded products to the market. For pro forma fiscal year 2021, net sales from LP SmartSide and Trex were approximately $209 million and $339 million, respectively. As such, our composite decking and railing, and exterior siding, trim and finish categories have revenue growth at CAGRs of 16% and 57%, from $29 million and $42 million in fiscal year 2018 to $113 million and $66 million in pro forma fiscal year 2021, respectively, at the Minneapolis branch. Our cross-selling strategy enables us to leverage our scale advantages to capture share from competitors and fortify our position in new markets. (ii) Cross-sell new products through existing markets We have a proven track record of being able to introduce new products from our portfolio to existing markets across our footprint. Our broad portfolio of leading brands spans over ten different product categories, which provides ample opportunity to cross-sell into underpenetrated markets. We have successfully implemented this strategy in our most mature markets in the southern U.S., such as Atlanta, Jacksonville, Greenville, Mobile and Raleigh, where we sell products across all of our categories. We believe there is significant whitespace across our broader footprint to which we can apply this strategy and drive above-market growth. For example, the Reeb Acquisition provided us with a brand new product category, specialty doors, which we expect to cross-sell through all of our existing markets, and the DW Acquisition complemented our new specialty door business. According to Principia, our addressable market for the top 100 core-based statistical areas ( CBSAs ) in the markets we serve is $31.4 billion. See Prospectus Summary Recent Developments. Continue to Expand our Relationships with Existing Suppliers In the markets we serve we are often the leading distributor for many of our core product categories. Our suppliers manufacture leading brands in categories that are growing above-market. As such, our ability to aggregate demand at scale and execute just-in-time delivery makes us an indispensable partner in our suppliers supply chains. Our broad geographical footprint enables our suppliers to access a larger percentage of the North Table of Contents American market through a single distributor relationship, which has economies of scale benefits for both parties and makes our relationship co-dependent. We seek to continue to deepen our relationships with existing suppliers by enabling their growth with our scale, which in turn allows us to grow with them as they penetrate new and existing markets. For example, our four year relationship with Louisiana Pacific began with our acquisition of NILCO in 2017, through which we acquired a distribution market for LP SmartSide siding products. Later in 2017, we expanded our Louisiana Pacific product offering to Engineered Wood Products. In pro forma fiscal year 2021, our LP SmartSide and Engineered Wood Products net sales were approximately $209 million, and approximately $292 million, respectively. Over this four year period, we added Louisiana Pacific products to our entire Eastern U.S. footprint, displacing incumbent distributors in each of those markets. Similarly, our relationship with Trex dates back to the early 1990s and, in pro forma fiscal year 2021, its core product categories represented approximately 12.5% of our net sales. When we acquired Midwest Lumber in 2018, Trex exited one distributor relationship and transitioned its product supply in those markets to us. We believe there is significant opportunity to continue to increase our distribution footprint alongside our suppliers over time. Continue to Pursue Strategic, Accretive Acquisitions The North American specialty building products market is highly fragmented and presents attractive opportunities for us to continue to grow through value enhancing acquisitions. Since 2016, we have executed eight acquisitions to expand our platform across the U.S. and into Canada, including the Reeb Acquisition, the DW Acquisition and the Millwork Acquisition, which we closed in the fourth quarter of 2021. In aggregate, these eight acquisitions represented approximately $1.8 billion in LTM sales at the time of acquisition. We expect to be acquisitive going forward and continually monitor acquisition targets that we believe will expand our platform. We believe our relationship-based approach and track record of executing on the terms and timeline we commit to make us an acquirer-of-choice in our industry. We employ a disciplined approach to identify, execute, and integrate acquisitions that expand our geographic presence and complement our existing product offering. Our acquisition strategy also has the potential to create sales synergies by enabling us to cross-sell existing products through our acquired markets, as well as the potential to generate cost synergies. Our acquisition strategy has given the Company a broader geographic presence and an expanded product mix. Our experienced mergers and acquisitions team actively maintains a large pipeline of synergistic acquisition targets that we expect will continue to drive our growth. Enter Attractive New Markets to Further Expand Geographic Presence We believe there are significant opportunities to leverage our existing network of suppliers and customers to expand our geographic reach. For example, while we currently serve more than 70 of the top 100 CBSA markets, our limited presence in the southwestern United States today represents significant whitespace for future growth. Historically, we have been able to successfully expand our geographic reach through the acquisition of well-run specialty distributors with strong market presence, such as our acquisitions of Alexandria Moulding Inc. ( Alexandria Moulding ) in 2018, Mid-State Lumber Corp. ( Mid-State Lumber ) in 2020 and DW Distribution in the fourth quarter of 2021. Each of these acquisitions had strong supplier and/or customer overlap and expanded the breadth and depth of our product categories. Expand Product Portfolio through Addition of Complementary, High-Growth Categories We seek to expand our offerings by adding new product categories where there is strong customer overlap and potential for above average long-term growth. Similar to our existing portfolio, the most attractive product categories benefit from secular growth trends such as material substitution, outdoor living and the Home Fortress mentality. We believe that our specialty product expertise, differentiated scale and market reach makes us the preferred partner for suppliers to bring to market innovative new products. For example, in 2017 we helped our existing supplier, Louisiana Pacific, launch its SmartSide pre-finish and trim products. Often, Table of Contents suppliers with whom we do not have an existing relationship will approach us with new products they would like us to add to our portfolio. For example, in 2016 we began distributing Boral Limited s TruExterior siding and trim products as part of our product offering, and as of pro forma fiscal year 2021, sales of TruExterior products have reached approximately $46 million, from $1.9 million in 2016, representing a CAGR of approximately 89.8%. Lastly, we also pursue expansion into new product categories through acquisition. For example, the Reeb Acquisition expands our product portfolio to include specialty doors, and, on a pro forma basis to give effect to the Reeb Acquisition as if it had closed on January 4, 2021, specialty doors represented approximately 16% of our combined net sales for pro forma fiscal year 2021. Prior to the acquisition of the Reeb Companies, our product portfolio did not include a specialty doors category. The addition of new product categories generates tremendous cross-selling whitespace in all of our markets for future growth. Utilize our Scale and Operating Efficiencies to Enhance Profitability We have invested significantly in our operating systems and infrastructure and believe that the investments we have made to date can support a much larger business than we have today. Our technologies enable real-time data collection across multiple source systems, including our enterprise resource planning system, logistics platform, and human resource information system. This data facilitates continuous optimization of product mix and fleet routes, product selection, and inventory management, reducing costs and reducing our overall environmental footprint. For example, our fleet optimization technology improves route efficiency, reducing driver headcount, miles driven, and ultimate fuel consumption. We leverage individual purchasing data through our customer analytics tools to inform customers of their purchasing habits and frequency. We are able to advise our customers how to optimize their purchasing, thus reducing overall shipping costs and avoiding unnecessary freight and rushed order costs. We will continue to utilize our technology platform to drive actionable, informed business decisions that enhance growth, strengthen efficiencies and improve profitability. Continue to Invest in Attracting, Developing, and Retaining World Class Talent We believe the success of our growth strategy and organization depends on our ability to attract, develop, and retain world class talent. Identifying, recruiting, training, integrating, and retaining qualified individuals requires significant time, expense, and attention. We will continue to invest in tools and programs to attract, develop, and retain our employees as we believe their development is critical to our culture and the execution of our strategies. Summary Risk Factors Our business and our ability to execute our strategy are subject to many risks. Before making a decision to invest in our common stock, you should carefully consider all of the risks and uncertainties described in the section of this prospectus captioned Risk Factors immediately following this Prospectus Summary and all of the other information in this prospectus. These risks include, but are not limited to, the following: residential construction activity is seasonal, cyclical and influenced by many factors, and any reduction in the activity in one or both of these markets could have a material adverse effect on us; the COVID-19 pandemic has impacted our business and operations and has disrupted our ability to procure enough supply to satisfy market demands, and the resulting future business and operational challenges posed by the COVID-19 pandemic could materially adversely affect us; our industry is fragmented and competitive and we may not be able to compete successfully with existing competitors or new entrants to the market; we generally do not have long-term commitments or contracts with our clients and consolidation in our customers industries could have a material adverse effect on us; Table of Contents our business operations could suffer significant losses from natural disasters, catastrophes, fire or other unexpected events; an inability to obtain the products that we distribute (including as a result of COVID-19) or increases in prices by our suppliers could result in lost net sales and reduced margins; our key supplier relationships could be terminated; we may be unable to successfully identify, acquire, close or successfully integrate acquisitions; a tightening of mortgage lending or mortgage financing requirements or other reductions in the availability of consumer credit or increases in its cost could have a material adverse effect on us; trade matters, including the Russia-Ukraine Conflict (as defined herein), may disrupt our supply chain; we depend on the services of key executives and any inability to attract and retain key management personnel could have a material adverse effect on us; cybersecurity attacks may threaten our confidential information, disrupt operations and result in harm to our reputation and adversely impact our business and financial performance; our ability to remediate our identified material weaknesses and/or establish and maintain effective internal controls in the future; our substantial level of indebtedness could adversely affect our financial condition; the unaudited pro forma financial information included in this prospectus may not be representative of our future results of operation and financial condition; SBP Varsity Holdings controls us, and its interests may conflict with ours or yours in the future; and after the completion of this offering, our status as a controlled company will grant us exemptions from certain corporate governance requirements and you will not have the same protections as those afforded to stockholders of companies that are subject to such governance requirements. Table of Contents Organizational Corporate Structure The following chart illustrates our simplified ownership and organizational structure, after giving effect to this offering. All subsidiaries are 100% directly or indirectly owned. Dotted lines denote indirect ownership. (1) Co-borrower under the ABL Credit Agreement, Term Loan Facility and Senior Secured Notes. (2) Parent entity for operating subsidiaries. (3) Co-borrower under the ABL Credit Agreement, Term Loan Facility and Senior Secured Notes. (4) Sale, manufacturing, delivery and distribution of building products in the United States. (5) Sale, manufacturing, delivery and distribution of moulding products in the United States and Canada. (6) Sale, manufacturing, delivery and distribution of specialty doors in the United States and Canada. Recent Developments The financial data for Reeb, DW, and Millwork included in this prospectus has been prepared by, and is the responsibility of, our management. PricewaterhouseCoopers LLP has not audited, reviewed, compiled, or applied agreed-upon procedures with respect to the financial data. Accordingly, PricewaterhouseCoopers LLP does not, and will not in the future, express an opinion or any other form of assurance with respect thereto. Reeb Acquisition On October 15, 2021, we acquired all of the equity interests of each of Reeb Millwork Corporation, a New Jersey corporation, R and K Logistics, Incorporated, a Pennsylvania corporation, Reeb Millwork Corporation Southeast, a North Carolina corporation, Reeb Millwork of New England, Inc., a Rhode Island corporation, Reeb Millwork Corporation of Maryland, Inc., a Maryland corporation, and Reeb Table of Contents Millwork Corporation of New York, a New York corporation (collectively, the Reeb Companies ) for $570 million. We refer to this acquisition as the Reeb Acquisition. The Reeb Companies are market leading fabricators and suppliers of pre-finished and unfinished exterior and interior doors and millwork, providing highly customized products to a diversified customer base. The Reeb Companies operate facilities in Bethlehem, Pennsylvania, Barclay, Maryland, Providence, Rhode Island, Mocksville, North Carolina and Syracuse, New York, which service customers in over twenty states. For the nine months ended September 30, 2021, the Reeb Companies had net sales of $348 million, net income of $34 million, and EBITDA of $41 million. For discussion of our use of EBITDA and reconciliation to net income, the most directly comparable GAAP metric, please refer to Recent Acquisition Non-GAAP Metrics at the end of the Prospectus Summary. On a pro forma basis to give effect to the Reeb Acquisition as if it has closed in the beginning of the 2021 fiscal year, specialty doors represented approximately 16% of our combined net sales for pro forma fiscal year 2021. Prior to the acquisition of the Reeb Companies, our product portfolio did not include a specialty doors category and, as a result, specialty doors did not contribute to our historical net sales for periods ending on or prior to October 3, 2021. The Reeb Acquisition closed on October 15, 2021. In connection with the Reeb Acquisition, we borrowed $800 million in the form of a new term loan (the Term Loan Facility ) to finance the acquisition. Approximately $600 million of the proceeds received from the Term Loan Facility was used to finance the Reeb Acquisition and pay related fees and expenses. See Management s Discussion and Analysis of Financial Condition and Results of Operations Liquidity and Capital Resources Debt Arrangements. Dallas Wholesale Builders Supply Acquisition On November 1, 2021, we acquired all of the equity securities of DW Distribution, Inc., a Texas corporation ( DW ), for $236 million in cash. We refer to this acquisition as the DW Acquisition. Headquartered in DeSoto, Texas, DW Distribution is a wholesale distributor of an industry-leading array of building materials, millwork products and specialty door units. In addition to its DeSoto, Texas location, DW Distribution operates facilities in Arlington, Texas; Hutto, Texas; Lancaster, Texas; and Oklahoma City, Oklahoma that service customers located in Texas, Oklahoma, Arkansas, Louisiana and New Mexico. For the nine months ended September 30, 2021, DW Distribution had net sales of $264 million, net income of $22 million and EBITDA of $23 million. For discussion of our use of EBITDA and reconciliation to net income, the most directly comparable GAAP metric, please refer to Recent Acquisition Non-GAAP Metrics at the end of the Prospectus Summary. The DW Acquisition closed on November 1, 2021. Approximately $200 million of the proceeds from the Term Loan Facility, along with cash on hand, was used to finance the DW Acquisition and pay related transaction fees and expenses. Millwork Acquisition On December 2, 2021, we acquired all of the equity securities of Millwork Sales of Royal Palm Beach, LLC, a Florida limited liability company, and Millwork Sales of Orlando, LLC, a Florida limited liability company, (together, Millwork ) for a purchase price of $192 million. We refer to this acquisition as the Millwork Acquisition . Millwork is a distributor of millwork, hardware and related products to commercial dealers and retailers. The company operates facilities in Orlando and Royal Palm Beach, Florida, which service customers in Florida. For the nine months ended September 30, 2021, Millwork had net sales of $132 million, net income of Table of Contents $25 million and EBITDA of $25 million. For discussion of our use of EBITDA and reconciliation to net income, the most directly comparable GAAP metric, please refer to Recent Acquisition Non-GAAP Metrics at the end of the Prospectus Summary. The Millwork Acquisition closed on December 2, 2021, and we financed the Millwork Acquisition using approximately $192 million in borrowings under the ABL Credit Agreement. Our Principal Stockholder We have a valuable relationship with our principal equityholder, SBP Varsity Holdings, an entity controlled by funds advised by The Jordan Company, L.P. The Jordan Company, L.P. is a middle-market private equity investment firm headquartered in New York. Founded in 1982, the firm has raised original capital commitments in excess of $17 billion and has a 39-year track record of investing in and contributing to the growth of many businesses across a wide range of industries. The firm has completed over 120 platform investments and more than 400 add-on acquisitions. The Jordan Company, L.P. also has offices in Chicago and Stamford. Corporate Information The Company was incorporated in Delaware in December 2020 to serve as an acquisition vehicle in connection with the TJC Acquisition, whereby SBP Varsity Holdings acquired from existing equityholders 100% of the equity interests of Specialty Building Products, LLC, the then-ultimate parent company of SBP Predecessor, the holding company through which we control our operating subsidiaries. We are a holding company, and all of our operations are conducted through our subsidiaries. Our principal executive offices are located at 2160 Satellite Boulevard, Suite 450, Duluth, Georgia 30097. Our telephone number is (678) 474-4577. Our website address is www.specialtybuildingproducts.com. The information contained on, or that can be accessed through, our website is not incorporated by reference into this prospectus or the registration statement of which this prospectus is a part, and you should not consider any information contained on, or that can be accessed through, our website as part of this prospectus or in deciding whether to purchase our common stock. Table of Contents THE OFFERING Issuer Specialty Buildings Products, Inc. Common stock offered by us shares. Option to purchase additional shares We have granted the underwriters a 30-day option to purchase up to additional shares of common stock from us at the initial public offering price less the underwriting discount. Common stock to be outstanding immediately after this offering shares (or shares if the underwriters option to purchase additional shares is exercised in full). Use of proceeds We expect to receive approximately $ million (or $ million if the underwriters option to purchase additional shares is exercised in full) based on an assumed initial public offering price of $ per share, which is the midpoint of the price range set forth on the cover page of this prospectus, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us. We intend to use the net proceeds of approximately $ million that we will receive from this offering to fully repay the amounts outstanding under the ABL Credit Agreement. The remaining proceeds, if any, will be used to repay a portion of the amounts outstanding under the Term Loan Facility. See Use of Proceeds. Controlled company After this offering, assuming an offering size as set forth in this section, SBP Varsity Holdings will beneficially own approximately % of our common stock (or % of our common stock if the underwriters option to purchase additional shares is exercised in full). As a result, we expect to be a controlled company within the meaning of the corporate governance standards of Nasdaq. See Management Corporate Governance Controlled Company Status. Dividend policy We do not currently anticipate paying dividends on our common stock. Any declaration and payment of future dividends to holders of our common stock will be at the sole discretion of our board of directors (the Board ) and will depend on many factors, including our financial condition, earnings, capital requirements, level of indebtedness, statutory and contractual restrictions applicable to the payment of dividends, and other considerations that our Board deems relevant. Because we are a holding company and have no direct operations, we will only be able to pay dividends from our available cash on hand and any funds we receive from our subsidiaries. Certain of our debt agreements limit the ability of certain of our subsidiaries to pay dividends. In addition, Delaware law may impose requirements that may restrict our ability to pay dividends. See Dividend Policy. Table of Contents Listing We intend to list our common stock on Nasdaq under the symbol SBP. Risk factors See Risk Factors beginning on page 26 and other information included in this prospectus for a discussion of factors you should carefully consider before deciding to invest in shares of our common stock. Unless we specifically state otherwise or the context otherwise requires, the share information in this prospectus: gives effect to a 1-for- stock split of our common stock, which will occur before the closing of this offering; gives effect to the issuance of shares of common stock in this offering, at an assumed an initial public offering price of $ per share, the midpoint of the price range set forth on the cover page of this prospectus; assumes no exercise of the underwriters option to purchase up to an additional shares of common stock from us in this offering; does not reflect shares of common stock that are reserved for future grants or sale under our new omnibus equity incentive plan (the 2022 Plan ), including a number of shares underlying stock options and restricted stock units with an aggregate grant date fair value of $14,571,925, which we expect to grant in connection with close of this offering; does not reflect shares of common stock that are reserved for future issuance under our new employee stock purchase plan (the 2022 ESPP ); and assumes the filing of our amended and restated certificate of incorporation and the adoption of our amended and restated bylaws, each in connection with the closing of this offering. Table of Contents SUMMARY HISTORICAL AND PRO FORMA FINANCIAL INFORMATION Summary Historical Consolidated Financial Information The following summary historical consolidated financial information as of January 2, 2022 (Successor) and January 3, 2021 (SBP Predecessor), and for the period from January 21, 2021 through January 2, 2022 (Successor), the period from January 4, 2021 through January 20, 2021 (SBP Predecessor), in each of the two fiscal years in the period ended January 3, 2021 and for the fiscal year ended December 29, 2019 (SBP Predecessor), have been derived from the audited consolidated financial statements as of and for such periods, included elsewhere in this prospectus. The following summary of historical consolidated financial information reflects the impact of revisions to correct for prior period immaterial errors as well as reclassifications to conform prior period presentation to current period presentation, as further described in Note 1 to our consolidated financial statements included elsewhere in this prospectus. On January 21, 2021, the TJC Acquisition closed and SBP Varsity Holdings acquired from existing equityholders 100% of the equity interests of Specialty Building Products, LLC, the then-ultimate parent company of SBP Predecessor. SBP Predecessor is the holding company through which we control our operating subsidiaries. As the Company had not conducted operations prior to consummation of the TJC Acquisition on January 21, 2021, SBP Predecessor is deemed predecessor of the Company and its subsidiaries for financial reporting purposes. Accordingly, the historical financial information presented in this prospectus (i) for periods prior to January 21, 2021, represents that of SBP Predecessor and its subsidiaries, and (ii) for periods from and after January 21, 2021, represents that of the Company and its subsidiaries, including SBP Predecessor, as successor. As a result of the foregoing, the summary historical consolidated financial information for the Company (Successor) and SBP Predecessor are not comparable and are separated by a black line. The information set forth below is only a summary and is not necessarily indicative of our future results of operations, and you should read the following information together with our audited consolidated financial statements, unaudited condensed consolidated financial statements, the related notes and the section entitled Management s Discussion and Analysis of Financial Condition and Results of Operations contained elsewhere in this prospectus. Successor Predecessor (in thousands, except per share amounts) Period From January 21, 2021 through January 2, 2022 Period From January 4, 2021 through January 20, 2021 Year Ended January 3, 2021 Year Ended December 29, 2019 Consolidated statements of operations data: Net sales $ 2,584,630 $ 114,608 $ 1,670,070 $ 1,389,570 Cost of sales 1,987,992 88,555 1,313,600 1,094,491 Gross profit 596,638 26,053 356,470 295,079 Distribution expenses 147,637 7,121 121,945 116,291 Selling expenses 77,215 2,675 57,460 55,943 General and administrative expenses 99,777 3,940 68,309 54,879 Depreciation and amortization expense 52,398 1,552 25,223 30,880 Business acquisition and other related costs 17,365 26,182 1,840 Other operating income (54 ) (488 ) (1,020 ) (74 ) Income from operations 202,300 (14,929 ) 82,713 37,160 Interest expense 48,925 2,536 54,798 50,525 Income (loss) before income taxes 153,375 (17,465 ) 27,915 (13,365 ) Income tax expense (benefit) 39,466 127 9,896 (984 ) Net income (loss) $ 113,909 $ (17,592 ) $ 18,019 $ (12,381 ) Table of Contents Successor Predecessor (in thousands, except per share amounts) Period From January 21, 2021 through January 2, 2022 Period From January 4, 2021 through January 20, 2021 Year Ended January 3, 2021 Year Ended December 29, 2019 Basic and Diluted earnings per share 113,909 n/a n/a n/a Other comprehensive income (loss) Foreign currency translation (340 ) 410 2,434 (321 ) Total other comprehensive income (loss) (340 ) 410 2,434 (321 ) Comprehensive income (loss) $ 113,569 $ (17,182 ) $ 20,453 $ (12,702 ) Successor Predecessor (in thousands) As of January 2, 2022 As of January 3, 2021 Consolidated balance sheet data: Cash and cash equivalents $ 32,538 $ 24,118 Working capital(1) 620,155 314,511 Accounts receivable, net 350,500 200,619 Total assets 2,932,640 1,041,868 Total long-term debt, net of debt issuance costs 1,669,873 637,060 Total liabilities 2,378,305 958,465 Common stock Additional paid in capital 440,766 Contributed capital 82,738 Accumulated other comprehensive income (loss) (340 ) 1,838 Retained earnings (accumulated deficit) 113,909 (1,173 ) Total stockholders and member equity 554,335 83,403 (1) Working capital represents total current assets less total current liabilities. Summary Unaudited Pro Forma Combined Financial Information The following summary unaudited pro forma combined statement of operations data for the year ended January 2, 2022 has been prepared to give effect to the TJC Acquisition and related financing adjustments (the TJC Transaction Accounting Adjustments ) and the Reeb Acquisition and related financing adjustments (the Reeb Transaction Accounting Adjustments ) as if the related transactions had occurred on January 4, 2021. The following summary unaudited pro forma combined financial information is for illustrative and informational purposes only and is not necessarily indicative of the results that might have occurred had the relevant transactions occurred on the date indicated, and is not intended to be a projection of future results. Future results may vary significantly from the results reflected because of various factors, including those discussed in the section titled Risk Factors in this prospectus. The following summary unaudited pro forma combined financial information should be read in conjunction with Unaudited Pro Forma Combined Financial Statements, which includes more information related to each of the TJC Transaction Accounting Adjustments and the Reeb Transaction Accounting Adjustments. Table of Contents (in thousands, except share and per share data) Pro Forma Combined Fiscal Year 2021 Net sales $ 3,068,814 Cost of sales 2,318,025 Gross profit 750,789 Distribution expenses 187,431 Selling expenses 98,608 General and administrative expenses 146,949 Amortization and depreciation expense 68,742 Business acquisition and other related costs 43,547 Other operating income (542 ) Income from operations 206,054 Interest Expense/(Income), net 72,193 Income (loss) before income taxes 133,861 Income tax expense (benefit) 39,472 Net income (loss) 94,389 Earnings (loss) per share: Basic and Diluted 94,389 Weighted average number of shares outstanding: Basic 1,000 Diluted 1,000 Recent Acquisition Non-GAAP Financial Metrics We use EBITDA as a measure of operating performance, and we believe that this non-GAAP financial measure is useful to investors for supplemental period-to-period comparisons of our business and in understanding and evaluating our operating results. EBITDA assists investors in evaluating our financial performance on a consistent basis. We define EBITDA as net income, less income tax expense, interest expense, and depreciation and amortization. The tables below show a reconciliation of this non-GAAP financial measure to net income, the most directly comparable GAAP metric. The financial data for Reeb, DW, and Millwork included in this prospectus has been prepared by, and is the responsibility of, our management. PricewaterhouseCoopers LLP has not audited, reviewed, compiled, or applied agreed-upon procedures with respect to the financial data. Accordingly, PricewaterhouseCoopers LLP does not, and will not in the future, express an opinion or any other form of assurance with respect thereto. The Reeb Acquisition Reconciliation of EBITDA to Net income (in thousands) Unaudited Nine-Month Period Ended September 30, 2021 Reported Net Income $ 33,549 Interest expense 674 Taxes 404 Depreciation & amortization 6,303 EBITDA $ 40,930 Table of Contents The unaudited information included above for the Reeb Acquisition has been prepared using the Reeb Companies financial statements included in this prospectus. The DW Acquisition Reconciliation of EBITDA to Net income (in thousands) Unaudited Nine-Month Period Ended September 30, 2021 Reported Net Income $ 21,607 Interest expense 264 Depreciation & amortization 676 EBITDA $ 22,548 The unaudited information included above for the DW Acquisition has been prepared using the historical results of DW adjusted for items we believe are necessary to reflect GAAP net income for the period. The Millworks Acquisition Reconciliation of EBITDA to Net income (in thousands) Unaudited Nine-Month Period Ended September 30, 2021 Reported Net Income $ 25,097 Interest expense 15 Depreciation & amortization 365 EBITDA $ 25,477 The unaudited information included above for the Millworks Acquisition has been prepared using the historical results of Millworks adjusted for items we believe are necessary to reflect GAAP net income for the period. Table of Contents RISK FACTORS Investing in our common stock involves a high degree of risk. Our reputation, business, financial position, results of operations and cash flows are subject to various risks. You should consider and read carefully all of the risks and uncertainties described below, as well as other information included in this prospectus, including our consolidated financial statements and related notes, before making an investment decision. The occurrence of any of the following risks or additional risks and uncertainties not presently known to us could materially and adversely affect our reputation, business, financial position, results of operations or cash flows. In such case, the trading price of our common stock could decline, and you may lose all or part of your investment. This prospectus also contains forward-looking statements and estimates that involve risks and uncertainties. See Cautionary Note Regarding Forward-Looking Statements. Our actual results could differ materially from those anticipated in the forward-looking statements as a result of specific factors, including the risks and uncertainties described below. Risks Related to Our Business and Industries Residential construction activity is cyclical and influenced by many factors, and any reduction in the activity in one or both of these markets could have a material adverse effect on us. Historically, demand for our products has been closely tied to residential construction, including residential repair and remodel spending, in the United States and Canada. Our success and future growth prospects depend, to a significant extent, on conditions in these two geographic markets and the degree to which these markets are strong in the future. The construction industry and related markets are cyclical and have in the past been, and may in the future be, materially and adversely affected by general economic and global financial market conditions. These factors impact not only our business, but those of our customers and suppliers as well. This influence is true with respect to macroeconomic factors within North America, particularly within our geographic footprint in the United States and Canada. For example, in 2008, residential construction activity dipped to historically low levels during the financial crisis. As a result, demand for many of our products dropped significantly. The markets in the construction industry in which we operate are also subject to other more specific factors. Residential construction activity levels are influenced by and sensitive to a number of factors, including mortgage availability, the cost of financing a home (in particular, mortgage terms and interest rates), unemployment levels, household formation rates, gross domestic product, residential vacancy and foreclosure rates, demand for second homes, existing housing prices, rental prices, housing inventory levels, building mix between single- and multi-family homes, consumer confidence, seasonal weather factors, the available labor pool and government regulation, policy and incentives. In addition, the construction industry is impacted by the availability of labor and labor shortages may have an impact on the level of construction activity. We cannot control the foregoing factors, we cannot be certain that they will remain at current levels, and there can be no assurances regarding whether any growth in our markets can be sustained. If construction activity in our markets decreases, whether locally, regionally or nationally, it could have a material adverse effect on our business, financial condition and results of operations. The specialty building materials distribution industry is fragmented and competitive, and we may not be able to compete successfully with some of our existing competitors or new entrants in the markets we serve. The specialty building materials distribution industry is fragmented and competitive. Our competition varies by product line, customer classification and geographic market. The principal competitive factors in our industry are: pricing and availability of product; service and delivery capabilities; Table of Contents ability to assist with problem-solving; customer relationships; geographic coverage; and breadth of product offerings. Financial stability is also important to manufacturers and customers in choosing distributors for their products. We compete with many local, regional and, in some markets and product categories, national building materials distributors and dealers. In addition, some product manufacturers sell and distribute their products directly to our customers, and the volume of such direct sales could increase in the future. Manufacturers of products distributed by us may also enter into exclusive supplier arrangements with our competition or may decide to sell directly to our customers. Further, home center retailers, which have historically concentrated their sales efforts on retail consumers and small contractors, may intensify their marketing efforts to larger contractors and homebuilders. Our competitors may sell their products at lower prices because, among other things, they possess the ability to manufacture or supply similar products and services more efficiently or at a lower cost or have built a superior sales or distribution network. Some of our competitors have greater financial and other resources and may be able to withstand sales or price decreases better than we can. We also expect to continue to face competition from new market entrants. We may be unable to continue to compete effectively with these existing or new competitors. In addition to pricing, we also compete based on service, quality, range of products and product availability. Our competitors may be positioned to provide better service and thereby establish stronger relationships with customers and suppliers. Our competitors may also sell preferred products, improve the design and performance of their products, develop a more comprehensive product portfolio, be better positioned to influence end-user product specifications or introduce new products with competitive prices and performance characteristics. While the majority of our products are not subject to frequent or rapid stylistic changes, trends do evolve over time, and our competitors may do a better job of predicting market developments or adapt more quickly to new technologies or evolving customer requirements. Any failure by us to compete on price or service, to develop successful products and strategies or to generally maintain and improve our competitive position could have a material adverse effect on our business, financial condition and results of operations. Our dependence on key customers with whom we do not have long-term contracts and consolidation within our customers industries could have a material adverse effect on us. Our business is dependent on certain key customers. We had two major customers that accounted for approximately 11% and 10% of net sales for the period from January 21, 2021 to January 2, 2022 (Successor). We had one major customer that accounted for approximately 15% of net sales for the period from January 4, 2021 to January 20, 2021 and the years ended January 3, 2021 and December 29, 2019 (Predecessor). We had one major customer that accounted for more than 10% of total accounts receivable at January 2, 2022 (Successor). We had no major customer that accounted for more than 10% of total accounts receivable at January 3, 2021 (Predecessor). As is customary in our industry, we do not enter into long-term contracts with our customers. As a result, our customers could stop purchasing our products, reduce their purchase levels or request reduced pricing structures at any time. We may therefore need to adapt our pricing and marketing strategies in response to a customer who may seek concessions in return for its continued or increased business. While we have exclusive, or effectively exclusive, arrangements with many suppliers, these are often not contractual and could be changed at any time, which could reduce or eliminate any competitive advantage that we have. In addition, a macroeconomic downturn or any other cause of consolidation in the U.S. homebuilding industry or among our other customers, as occurred during the financial crisis when a number of smaller businesses went out of business or were acquired, can significantly increase the market share and bargaining power of a limited number of customers and give them significant additional leverage to negotiate more favorable terms and place greater demands on us. A loss of one or more customers or a meaningful reduction in their purchases from us or further consolidation within our end-markets could have a material adverse effect on our business, financial condition and results of operations. Table of Contents The trend toward consolidation in our industry may negatively impact our business. The trend toward consolidation in our industry could cause markets to become more competitive as greater economies of scale are achieved by distributors that are able to efficiently expand their operations. We believe these factors could result in fewer overall distributors operating multiple locations. There can be no assurance that we will be able to continue to execute our acquisition growth strategy, and any failure to do so may make it more difficult for us to maintain or increase our economies of scales, including the level of rebates we receive from suppliers, and adversely affect our operating margins. Consolidation could also increase the competition for acquisition targets in our industry, resulting in higher acquisition costs and prices. An inability to obtain the products that we distribute or increases in prices by our suppliers could result in lost net sales and reduced margins, damage relationships with customers or limit our ability to grow. We distribute specialty building materials that are manufactured by a number of major suppliers. Disruptions in our sources of supply may occur as a result of unanticipated demand or production or delivery difficulties. When shortages occur, suppliers often allocate products among distributors. Although we believe that our relationships with our suppliers are strong and that we would have access to similar products from competing suppliers should products be unavailable from current sources, any supply shortage, particularly of the most commonly sold items, could result in a loss of net sales, reduced margins and damage relationships with customers. In addition, our suppliers may experience demand for products that outstrips their capacity. As a result, we may experience product shortages that limit our ability to grow into new markets or expand our product line into existing markets. Our results of operations are impacted by price fluctuations. Volatility in prices of raw materials could cause our suppliers to increase their prices, which, could in turn, affect our financial results. Although we seek to recover increases in prices from our vendors through price increases in our products, we may not be able to successfully do so. Any increase in prices from our vendors that is not offset by an increase in our prices could materially and adversely affect our business, financial position, results of operations or cash flows. Additionally, we must maintain and have adequate working capital to purchase sufficient inventory to meet customer demand. Due to the lead times required by our suppliers, we order products in advance of expected sales. In the future, if we are unable to manage our inventory and working capital effectively as we attempt to expand our business, our cash flows may be negatively affected, which could have a material adverse effect on our business, financial condition and operating results. The termination of key supplier relationships, particularly those with whom we have limited distribution arrangements, may have an immediate material adverse effect on our business, financial condition and results of operations. We distribute specialty building materials that we purchase from a number of major suppliers. For certain suppliers, including, among others, Trex, James Hardie, Louisiana Pacific and Royal Group, we have entered into limited distribution agreements, which either grant us exclusivity or limit the number of other distributors that have access to their products in that market. Certain other of our suppliers do not provide contractual exclusivity or territorial limitations to us, but as a business practice effectively limit their distributors to us and a small number of other companies to supply their products in each territory. In pro forma fiscal year 2021, approximately 84% of our sales were from products where we had formal or practical limited distribution for such products. As is customary in our industry, most of our relationships with these suppliers are terminable without cause on short notice. We had one major supplier that accounted for approximately 16%, 14%, 13% and 10% of our purchases for the period from January 21, 2021 to January 2, 2022 (Successor) and the period from January 4, 2021 to January 20, 2021 and the years ended January 3, 2021 and December 29, 2019 (Predecessor), respectively. In addition, one major supplier that accounted for approximately 33% of our total accounts payable balances at January 2, 2022. Although we believe that relationships with our existing suppliers are strong and that Table of Contents in most cases we would have access to similar products from competing suppliers, the termination of key supplier relationships, a change in their use of limited distributors by territory or any other disruption in our sources of supply, particularly of our most commonly sold items or for any supplier with whom we have exclusivity or limited distribution arrangements, could have a material adverse effect on our business, financial condition and results of operations. Our business operations could suffer significant losses from natural disasters, catastrophes, fire or other unexpected events. While we currently operate our business out of 38 facilities and maintain insurance covering our facilities, including business interruption insurance, our facilities could be materially damaged by natural disasters, such as floods, tornadoes, hurricanes and earthquakes, or by fire, adverse weather conditions or other unexpected events or disruptions to our facilities. We could incur uninsured losses and liabilities arising from such events, including damage to our reputation, and/or suffer material losses in operational capacity, which could have a material adverse impact on our business, financial condition and results of operations. Trade matters may disrupt our supply chain. Trade restrictions, including increased tariffs or quotas, economic and trade sanctions and embargoes, safeguards, and customs restrictions, as well as labor strikes, work stoppages, or boycotts, could increase the cost or reduce the supply of products and labor available to us and adversely affect our business, financial condition, and results of operations. Certain building materials that we distribute may come from foreign jurisdictions outside North America, such as Chile and Brazil. Such materials may be imported because they may not be available for domestic purchase in the United States or Canada or because there may be a shortfall of inventory available locally. We sourced approximately 30% of our products internationally for pro forma fiscal year 2021, of which approximately 10% were sourced from Canada, approximately 17% were sourced from South America, approximately 2% were sourced from Asia, approximately 1% were sourced from Europe and approximately 1% were sourced from Central America. The business, regulatory, and political environments in these countries differ from those in the United States. We cannot predict whether any of the countries from where we currently or in the future may source our products will be subject to additional trade restrictions imposed by the United States or other foreign governments, including the likelihood, type, or effect of any such restrictions. Despite our efforts to ensure the merchantability of these products, such products may not adhere to United States and Canadian standards or laws. Importation of such building materials could subject us to greater risk, including lawsuits by customers or governmental entities. The propagation of COVID-19 throughout the world disrupted our ability to procure enough supply to satisfy market demands. As shutdowns of different types and severities were put in place, many of our local and foreign suppliers were forced to idle plants and cut back on production of their goods and services. As restrictions have eased over time, suppliers have slowly started ramping up their operations. A challenging labor market has made this process slower than anticipated, with many not yet operating at pre-COVID capacity. As of today, there is still a significant shortage in supply that continues to hinder our ability to fully satisfy the demand in the market. On February 24, 2022, Russia launched an invasion of Ukraine that has resulted in an ongoing military conflict between the two countries (the Russia-Ukraine Conflict ). The Russia-Ukraine Conflict has caused, and is currently expected to continue to cause, significant disruptions to the global financial system, international trade, and the transportation and energy sectors, among others. Resulting sanctions and other severe restrictions or prohibitions on the activities of certain individuals and businesses connected to Russia and/or Belarus are expected to continue to have profound impacts on the supply chain and commodity prices and may result in substantial inflation. The Russia-Ukraine Conflict may increase our operating costs (including, among other reasons, as a result of the substantial increase in prices for raw materials), reductions in customers, losses from cyberattacks, reductions in revenue and growth, increased foreign exchange risk and/or unexpected operational losses and liabilities. Table of Contents Our global sourcing strategy is subject to risks and uncertainties, including, without limitation, changes in foreign country regulatory requirements, differing business practices associated with foreign operations, imposition of foreign tariffs and other trade barriers, political, legal, and economic instability, significant fluctuation in the value of the U.S. dollar against foreign currencies, foreign country tax rules, regulations and other requirements, such as changes in tax rates and statutory and judicial interpretations in tax laws, inflation, differing labor laws and changes in those laws, government price controls, and work stoppages and disruptions in the shipping of imported and exported products. Our business, financial condition, results of operations and cash flows have been and in the future may be adversely affected by the COVID-19 pandemic. Our operations and business have been adversely affected and could in the future be materially and adversely affected, whether directly or indirectly, by the COVID-19 pandemic and the resulting weakening of economic conditions in the United States and Canada. For example, local, state, provincial and federal governmental authorities have responded to the pandemic by implementing stringent measures in geographies where we operate to help control the spread of the virus and related variants, including restrictions on movement such as quarantines, shelter-in-place, stay-at-home orders, and travel restrictions, as well as restricting or prohibiting outright some or all forms of commercial and business activity, and other restrictions, including closures of school and childcare facilities. Although we were categorized as essential by the Cybersecurity and Infrastructure Security Agency of the U.S. Department of Homeland Security and were therefore permitted to operate consistent with applicable local, state, provincial and federal orders, certain of our geographies have been affected by stay-at-home orders based on state and severity of government-imposed actions. Certain of these government-imposed actions and orders have since eased. However, any decision to re-initiate such actions, impose new or more severe restrictions or otherwise change pre-existing governmental orders could have a material adverse effect on our operations. The magnitude of the effect of the COVID-19 pandemic on our business will also depend, in part, on the severity and transmission rate of the virus, the efficacy of vaccines and rates of vaccination in various states and countries, the emergency of COVID-19 variants such as the omicron variant and others as yet unknown, and the impact of these and other factors on employees, customers, partners, vendors and the global economy. Our customers have been and could continue to be negatively impacted by the COVID-19 pandemic, including as a result of project delays and other adverse impacts on demand, which could result in adverse impacts on our sales and have a material adverse effect on our business, results of operations and financial condition. Similarly, our suppliers and other parts of our supply chain have experienced and could continue to experience disruptions and other adverse impacts as a result of the pandemic that could cause us to be unable to obtain key products and supplies on a timely or cost-effective basis, or in some cases, at all, any of which could result in our being unable to service our customers demands, and adversely affect our business and results of operations. Please read Trade matters may disrupt our supply chain for additional information. The COVID-19 pandemic, including the actions that we have taken in response, has disrupted our internal operations and heightened certain risks, such as the risk that a significant portion of our workforce will suffer illness or otherwise not be permitted or be unable to work. While very few of our employees have been required to work remotely to date, if we are required to increase this number in the future, it would heighten certain risks, including those related to cybersecurity and internal controls. In addition, in the event demand for our products is significantly reduced as a result of the COVID-19 pandemic and related economic impacts, we may need to assess different corporate actions and cost-cutting measures, including reducing our workforce or closing one or more distribution centers, and these actions could cause us to incur costs and expose us to other risks and inefficiencies, including whether we would be able to rehire our workforce or recommence operations if our business experiences a subsequent recovery. Additionally, other factors including reduced employment pools, federal subsidies offered in response to the COVID-19 pandemic, and other government regulations, including any potential vaccine mandate, could contribute to increased labor shortages and employee turnover within our organization. These trends have led to increased costs, such as increased overtime to meet demand and increase Table of Contents wage rates to attract and retain employees. An overall or prolonged labor shortage, lack of skilled labor, increased turnover or labor inflation could have a material adverse impact on our business, results of operations, liquidity or cash flows. The COVID-19 pandemic has also adversely affected economies worldwide and significantly disrupted financial and other capital markets, causing a significant deceleration of economic activity. This slowdown has decreased demand for a wide variety of goods and services, diminished trade levels, reduced production and led to widespread corporate downsizing, causing a sharp increase in unemployment. The impact of this pandemic on the U.S. and world economies is uncertain and, until the pandemic is contained, these adverse impacts could worsen, impacting all segments of the global economy, and result in a significant recession or worse. Conditions in the financial and capital markets have been extremely volatile and may limit or entirely restrict the availability of funding or increase the cost of funding, which could adversely affect our business, financial position and results of operations. Considerable uncertainty still surrounds the COVID-19 virus and its potential effects, and the extent and effectiveness of responses taken on local, national and global levels. While we expect the pandemic and related events will continue to have a negative effect on us, the unpredictable and unprecedented nature and fluidity of current circumstances makes it impractical to identify all potential risks or estimate the full extent and scope of the impact on our business and industry, as well as national, regional and global markets and economies. However, our ability to conduct our business in the manner previously or currently expected could be materially and adversely affected, and any of the foregoing risks and uncertainties as well as those that have not yet manifested themselves or been identified could have a material adverse impact on our business, financial condition, results of operations and cash flows. Changes in weather patterns, including as a result of global climate change, could significantly affect our financial results or financial condition. Weather patterns may affect our operating results and our ability to maintain our sales volume throughout the year. Because our customers depend on suitable weather to engage in construction projects, increased frequency or duration of extreme weather conditions could have a material adverse effect on our financial results or financial condition. For example, unseasonably cool weather or extraordinary amounts of rainfall may decrease construction activity, thereby decreasing our sales. Also, we cannot predict the effects that global climate change may have on our business. In addition to changes in weather patterns, it might, for example, reduce the demand for construction, destroy forests (increasing the cost and reducing the availability of wood products used in construction), and increase the cost and reduce the availability of raw materials and energy. New laws and regulations related to global climate change may also increase our expenses or reduce our sales. Any inability to identify, acquire, close or successfully integrate acquisitions or other transaction-related issues could have a material adverse effect on us. Acquisitions are a component of our growth strategy, but there can be no assurance that we will be able to continue to grow our business through acquisitions or that any businesses acquired will perform in accordance with expectations or that business judgments concerning the value, strengths and weaknesses of businesses acquired will prove to be correct. Historically, we have made a number of acquisitions, including the NILCO acquisition in 2017, the Midwest and Alexandria acquisitions in 2018, the Mid-State Lumber acquisition in 2020, and the Reeb Acquisition, the DW Acquisition and the Millwork Acquisition in 2021. The integration of acquired businesses can take a significant amount of time and also exposes us to significant risks and additional costs. Integrating these and any future acquisitions may strain our resources. Further, we may have difficulty integrating the operations, systems, controls, procedures or products of acquired businesses and may not be able to do so in a timely, efficient and cost-effective manner. These difficulties could include: assimilating personnel, human resources and other administrative departments and potentially contrasting corporate cultures; Table of Contents merging computer, technology and other information networks and systems; diversion of the attention of our management and that of the acquired business; merging or linking different accounting and financial reporting systems and systems of internal controls; disrupting our relationship with, or loss of, key customers, suppliers or personnel; interfering with, or loss of momentum in, our ongoing business or that of the acquired companies; and delays or cost overruns in the integration process. While historically we have not experienced any material integration issues, we have not fully integrated the Alexandria Moulding acquisition, the Reeb Acquisition, the DW Acquisition or the Millwork Acquisition, and we may encounter one or more of the issues discussed above, or others of which we are not yet aware. Any of these acquisition or other integration-related issues could divert management s attention and resources from our day-to-day operations, cause significant disruption to our business and lead to substantial additional costs. We may also be subject to claims or liabilities arising from the ownership or operation of our subsidiaries for the periods prior to our acquisition of them, including environmental liabilities. These claims or liabilities could be significant. Our ability to seek indemnification from the former owners of our subsidiaries for these claims or liabilities is limited by various factors, including the specific limitations contained in the respective acquisition agreements and the financial ability of the former owners to satisfy such claims or liabilities. In addition, certain proposed acquisitions or dispositions may trigger a review by U.S. Department of Justice, or the DOJ, and the U.S. Federal Trade Commission, or FTC, and the State Attorneys General under their respective regulatory authority, focusing on the effects on competition, including the size or structure of the relevant markets and the pro-competitive benefits of the transaction. Any delay, prohibition or modification required by regulatory authorities could adversely affect the terms of a proposed acquisition or could require us to modify or abandon an otherwise attractive acquisition opportunity. In addition, many of the businesses that we have acquired and will acquire have unaudited financial statements that have been prepared by the management of such companies and have not been independently reviewed or audited. We present certain unaudited financial information in this prospectus for the Reeb Acquisition, the DW Acquisition and the Millwork Acquisition that is derived from such unaudited financial statements prepared by the management of such acquired businesses. We cannot assure you that the financial statements of companies we have acquired or will acquire would not be materially different if such statements were independently reviewed or audited. In addition, our results of operations from these acquisitions could, in the future, result in impairment charges for any of our intangible assets, including goodwill, or other long-lived assets, particularly if economic conditions worsen unexpectedly. These changes could materially negatively affect our results of operations, financial condition or liquidity. We cannot assure you that we will identify or successfully complete transactions with suitable acquisition candidates in the future, nor can we assure you that completed acquisitions will be successful. Our inability to identify suitable acquisition targets, realize the anticipated benefits of an acquisition or to successfully integrate acquired companies as well as other transaction-related issues could have a material adverse effect on our business, financial condition and results of operations. Our acquisition strategy exposes us to significant risks and additional costs. Acquisitions also involve risks that the businesses acquired will not perform as expected and that business judgments concerning the value, strengths and weaknesses of acquired businesses will prove incorrect. We may not accurately assess the value, strengths, weaknesses or potential profitability of an acquisition target. We may become liable for certain unforeseen pre-acquisition liabilities of an acquired business, including, among others, tax Table of Contents liabilities, product liabilities, asbestos liabilities, environmental liabilities, pension liabilities and liabilities for employment practices, and these liabilities could be significant. In addition, an acquisition could result in the impairment of customer relationships or certain acquired assets such as inventory and goodwill. We may also incur costs and inefficiencies to the extent an acquisition expands the industries, products, markets or geographies in which we operate due to our limited exposure to and experience in a given industry, market or region. Large or a number of smaller acquisitions may also require that we incur additional debt to finance the transaction, which could be substantial and limit our flexibility in using our cash flow from operations for other purposes. Acquisitions can also involve post transaction disputes with the counter party regarding a number of matters, including a purchase price, inventory or other working capital adjustment, environmental liabilities or pension obligations. If any of these risks were to occur, our financial position, results of operations and liquidity may be adversely affected. Any significant fuel cost increases or shortages in the supply of fuel could disrupt our ability to distribute products to our customers, which could adversely affect our results of operations. We currently use our own fleet of over 438 owned and leased delivery vehicles in addition to third-party vehicles to service customers in the markets in which we operate. As a result, we are inherently dependent upon fuel to operate and are impacted by changes in diesel fuel prices. The cost of fuel has reached historically high levels during portions of the last several years, is largely unpredictable and has a significant impact on our results of operations. Fuel availability, as well as pricing, is also impacted by political and economic factors. It is difficult to predict the future availability of fuel due to a number of factors. Significant disruptions in the supply of fuel could have a negative impact on fuel prices and thus our business, financial condition and results of operations. A tightening of mortgage lending or mortgage financing requirements or other reductions in the availability of consumer credit or increases in its cost could have a material adverse effect on us. We depend on net sales generated from residential construction activity. Most home sales in the U.S. and Canada are financed through mortgage loans, and a significant percentage of renovation and other home repair activity is financed either through mortgage loans or other available credit. The financial crisis affected the financial position of many consumers and caused financial institutions to tighten their lending criteria, each of which contributed to a significant reduction in the availability of consumer credit. These developments resulted in a significant reduction in total new housing starts in the U.S. and consequently, a reduction in demand for our products in the residential sector. Similarly, while they have remained relatively low in recent years, the rate of interest payable on any mortgage or other form of credit has begun to rise and could continue to rise in the future, thus increasing the cost of borrowing and potentially making the purchase of a home less attractive, which could in turn reduce the number of new housing starts in the U.S. and Canada. Any future tightening of mortgage lending or other reductions in the availability of consumer credit or increases in its cost that have an impact on the rate of residential construction or remodeling activity could have a material adverse effect on our business, financial condition and results of operations. See also Residential construction activity is cyclical and influenced by many factors, and any reduction in the activity in one or both of these markets could have a material adverse effect on us above. The seasonality of our business and its susceptibility to severe and prolonged periods of adverse weather and other conditions could have a material adverse effect on us. Demand for our products in some markets is typically seasonal, with periods of snow or heavy rain negatively affecting construction activity. For example, sales of our products in Canada and the Northeast and Midwest regions of the United States are somewhat higher from spring through autumn when construction activity is greatest. Construction activity declines in these markets during the winter months in particular due to inclement weather, frozen ground and fewer hours of daylight. Construction activity can also be affected in any period by adverse weather conditions such as hurricanes, severe storms, torrential rains and floods, natural disasters such as fires and earthquakes and similar events, any of which could reduce demand for our products, push back existing orders to later dates or lead to cancellations. Furthermore, our ability to deliver products on Table of Contents time or at all to our customers can be significantly impeded by such conditions and events, such as those described above. These conditions, particularly when unanticipated, can leave both equipment and personnel underutilized. Additionally, the seasonal nature of our business has led to variation in our quarterly results in the past and may continue to do so in the future. This general seasonality of our business and any severe or prolonged adverse weather conditions or other similar events could have a material adverse effect on our business, financial condition and results of operations. Changes in currency exchange and interest rates could have a material adverse effect on our operating results and liquidity. We have operations in locations across the United States and Canada. On a combined basis, approximately 8% of our net sales for pro forma fiscal year 2021 was denominated in Canadian dollars. As such, our net sales, earnings and cash flow are exposed to risk from changes in currency exchange rates, which can be difficult to mitigate. Depending on the direction of changes relative to the U.S. dollar, Canadian dollar values can increase or decrease the reported values of our net assets and results of operations. We hedge this foreign currency exposure by evaluating the usage of certain derivative instruments which hedge certain, but not all, underlying economic exposures. We are also exposed to changes in interest rates as the ABL Credit Agreement and the Term Loan Facility bear interest at variable interest rates. Certain of future indebtedness may also bear interest at variable interest rates. As a result, interest rate increases will negatively impact our financial results. Our ability to access capital markets could also be impeded if adverse market conditions occur. We depend on the services of key executives and any inability to attract and retain key management personnel could have a material adverse effect on us. Our key management personnel, including our Chief Executive Officer and Chief Financial Officer, are important to our success because they are instrumental in setting our strategic direction, operating our business and identifying expansion opportunities. Additionally, as our business grows, we may need to attract and hire additional management personnel. We have employment agreements with some members of senior management; however, we cannot prevent our executives from terminating their employment with us, and any replacements we hire may not be as effective. Further, any transition involves inherent risk and any failure to ensure a smooth transition to new personnel could hinder our strategic planning, execution and future performance. While we strive to mitigate the negative impact associated with changes in our senior management team, there may be uncertainty among investors, employees, customers and others concerning our future direction and performance. Our ability to retain our key management personnel or to attract additional management personnel or suitable replacements when needed is dependent on a number of factors, including the competitive nature of the employment market. Any failure to retain key management personnel or to attract additional or suitable replacement personnel could have a material adverse effect on our business, financial condition and results of operations. Employee benefit costs, including health care costs for our employees, and risks related to our unionized employees may adversely affect our business, results of operations and financial condition. We provide health care and other benefits to our employees. In recent years, costs for health care have increased more rapidly than general inflation in the U.S. economy. If health care costs in the United States continue to increase, our cost to provide such benefits could increase, adversely impacting our profitability. Changes to health care regulations in the United States may also increase the cost to us of providing such benefits. Higher employee benefit costs could have an adverse effect on our business, results of operations and financial condition. Approximately 9% of our workforce was unionized as of January 2, 2022, and we maintain collective bargaining agreements with two unions in the United States and Canada. There are risks associated with union Table of Contents negotiations which could adversely impact our profitability, such as wage increases or additional work rules imposed by future agreements. In addition, any work stoppages or other labor disturbances could have a material adverse effect on our business, financial condition and results of operations. Credit and non-payment risks of our customers could have a material adverse effect on us. We are subject to the credit risk of our customers because we have provided, and we expect to provide, credit to our customers in the normal course of business. All of our customers are sensitive to economic changes and to the cyclical nature of the residential construction industry. All customers have a credit limit and payment terms. A customer s account stays open unless there is a material change in their business or the customer fails to abide by the credit limit and payment terms. Especially during protracted or severe economic declines and cyclical downturns in the residential construction industry, our customers may be unable to perform on their payment obligations, including their debts to us. While we partially insure against exposure from this risk, any failure by our customers to meet their obligations to us may have a material adverse effect on our business, financial condition, cash flows and results of operations. In addition, we may incur increased expenses related to collections in the future if we find it necessary to take legal action to enforce the contractual obligations of a significant number of our customers. We occupy many of our distribution centers under long-term non-cancellable leases, and we may be unable to renew our leases at the end of their terms. Many of our distribution centers are located on leased premises subject to non-cancellable leases. Typically, our leases have initial terms ranging from five to ten years, with options to renew for specified periods of time. We believe that our future leases will likely also be long-term and non-cancellable and have similar renewal options. If we close or stop fully utilizing a distribution center, we will most likely remain obligated to perform under the applicable lease, which would include, among other things, making the base rent payments, and paying insurance, taxes and other expenses on the leased property for the remainder of the lease term. Our future minimum aggregate rental commitments for leases for our buildings and equipment, as of January 2, 2022 was $242,705. In addition, at the end of the lease term and any renewal period for a facility, we may be unable to renew the lease without substantial additional cost, if at all. If we are unable to renew our facility leases, we may close or relocate a distribution center, which could subject us to construction and other costs and risks, which in turn could have a material adverse effect on our business and operating results. Further, we may not be able to secure a replacement center in a location that is as commercially viable, including access to rail service, as the lease we are unable to renew. Having to close a center, even briefly to relocate, would reduce the sales that such center would have contributed to our net sales. Additionally, a relocated center may be less profitable. If we are unable to terminate leases when we stop fully utilizing a facility or exit a geographic market, or if we were required to vacate multiple facilities at the end of a lease team, it could have a significant adverse impact on our business, financial condition and results of operations. We are exposed to product liability and other legal claims and proceedings that could have a material adverse effect on us. The nature of our business exposes us to product liability, construction defect and other litigation and legal proceedings. We rely on manufacturers and other suppliers to provide us with the majority of the products we sell and distribute. As we do not have direct control over the quality of the products manufactured or supplied by such third party suppliers, we are exposed to risks relating to the quality of the products we distribute. It is possible that inventory from a manufacturer or supplier could be sold to our customers and later be alleged to have quality problems, subjecting us to potential claims from customers or third parties despite our customary disclaimer of product quality warranties. We are subject to these claims from time to time, which are typically resolved by seeking indemnification from the applicable manufacturers without material financial impact on us. However, while we seek indemnification against potential liability for product liability claims from relevant parties, including but not limited to manufacturers and other suppliers, we cannot guarantee that we will be able Table of Contents to recover any losses we incur from product liability claims through such indemnification claims, which are dependent upon the financial viability of the indemnifying party. Even if we are ultimately successful in defending any claim relating to the products we distribute, claims and proceedings, whether or not they have merit and regardless of the outcome, are typically expensive and can divert the attention of management and other personnel for significant periods of time. In addition to any damages we may be required to pay, we are generally obligated to indemnify our current and former directors and officers in connection with lawsuits and related settlement amounts. Such amounts could exceed the coverage provided under our insurance policies. Any such claims and proceedings can impact customer confidence and the general public s perception of our company and products, even if the underlying assertions are proven to be false. While we have established reserves we believe to be reasonable under the facts known and have insurance coverage in place for certain types of claims which limits its exposure to certain liabilities, the outcomes of litigation and similar disputes are often difficult to reliably predict and may result in decisions or settlements that are contrary to, or in excess of, our expectations, and losses may exceed our reserves. In addition, various factors and developments could lead us to make changes in our current estimates of liabilities and related insurance receivables or make new or modified estimates as a result of a judicial ruling or judgment, settlement, regulatory development or change in applicable law. Any claims or proceedings, particularly those in which we are unsuccessful or for which we did not establish adequate reserves, could harm our reputation and could have a material adverse effect on our business, financial condition and results of operations. Our operations are subject to special hazards that may cause personal injury or property damage, subjecting us to liabilities and possible losses which may not be covered by insurance. Operating hazards, such as unloading heavy products, operating large machinery and driving hazards, inherent in our business, some of which may be outside of our control, can cause personal injury and loss of life, damage to or destruction of property, plant and equipment and environmental damage. We maintain insurance coverage in amounts and against the risks we believe are consistent with industry practice, but this insurance may not be adequate or available to cover all losses or liabilities we may incur in our operations. Our insurance policies are subject to varying levels of deductibles. Losses up to our deductible amounts are accrued based upon our estimates of the ultimate liability for claims incurred and an estimate of claims incurred but not reported. However, liabilities subject to insurance are difficult to estimate due to unknown factors, including the severity of an injury, the determination of our liability in proportion to other parties, the number of incidents not reported and the effectiveness of our safety programs. If we were to experience insurance claims or costs above our estimates, we might also be required to use working capital to satisfy these claims rather than using working capital to maintain or expand our operations. Our operations may be subject to environmental, health and safety laws and regulations and consumer use of certain of our products are subject to approvals, which could have a negative impact on our business, financial condition and results of operations. Our operations involve the use, handling, storage, and disposal of hazardous materials customary in distribution and light manufacturing, and are subject to environmental, health and safety laws and regulations at the national, state, local, and international levels. These laws and regulations include those governing the discharge of pollutants into the air and water, the use, management, and disposal of hazardous materials and wastes, chemicals in products, the cleanup of contaminated sites, and occupational health and safety. We have incurred and may continue to incur costs in complying with these laws and regulations. In addition, violations of, or liabilities under, these laws and regulations may result in restrictions being imposed on our operations or in our being subject to substantial fines, penalties, criminal proceedings, third-party property damage or personal injury claims, cleanup costs, or other costs. We may also become liable under certain of these laws and regulations for costs to investigate or remediate contamination at properties we own or operate, we formerly owned or operated. Liability under these laws and regulations can be imposed on a joint and several basis and without regard to fault or the legality of the activities giving rise to the contamination conditions. In addition, Table of Contents future developments such as more aggressive enforcement policies, the implementation of new, more stringent laws and regulations, or the discovery of presently unknown environmental conditions may require expenditures that could have an adverse effect on our business, financial condition, and results of operations. In addition, consumer use of certain of our products is subject to approvals by municipalities, state departments of transportation, engineers and developers. These approvals and specifications, including building codes, may affect the products our customers or the end users are allowed or choose to use, and, consequently, failure to obtain or maintain such approvals or changes in building codes may affect the saleability of our products or may require us to make changes to our products that could increase the cost of doing business. In the event any of the above risks were to materialize, it could have a material adverse impact on our business, financial condition and results of operations. Our business and financial performance could be adversely impacted due to disruptions, delays, or outages of our information technology systems and computer networks. Our distribution centers and our sales and service activities, including the processing, transmission and storage of electronic information utilized in connection with our operations, depend on the efficient, reliable and uninterrupted operation of complex and sophisticated information technology systems and computer networks, which may be subject to malfunction, failure, damage or disruption due to fire, flood, natural disasters, malicious attacks, human error, accidents, power disruptions, telecommunications failures, acts of terrorism or war, computer viruses, physical or electronic break-ins or other similar events. Our existing safety systems, data backup, and information technology emergency planning may not be sufficient to prevent long-term system or network outages or data loss. Additionally, because we have grown through various acquisitions, we have integrated and are integrating a number of disparate information technology systems across our organization in order to align our systems, further increasing the likelihood of problems. We may in the future integrate, replace or upgrade existing systems or implement new technology systems. These integrations and/or updated and new systems may not be successful, and may create new issues we currently do not face, or may significantly exceed our cost estimates. Any disruption of our information technology systems or networks could interrupt or otherwise impair our operations and negatively impact our ability to meet customer needs and to maintain critical operational or financial controls. These events could damage our reputation and cause us to incur unanticipated liabilities, including financial losses from remedial actions, business interruptions, loss of business and other unanticipated costs, which may not be covered by insurance. Despite the defensive measures we have taken to maintain and protect our information technology systems (and the information processed or transmitted by, or stored in, our systems), our systems may still be vulnerable to disruption and any such disruption and the resulting fallout could have a material adverse effect on our business, financial condition and results of operations. Cybersecurity threats, attacks and other incidents may compromise our confidential information, disrupt operations, subject us to increased costs or liabilities and/or result in harm to our reputation, any of which could adversely impact our business and financial performance. Cybersecurity threats and attacks are increasing in sophistication and frequency and may range from uncoordinated individual attempts to measures targeted specifically at us or our service providers in order to gain unauthorized access to, or otherwise disrupt, our information systems, and/or to gain unauthorized access to, corrupt, modify or destroy business, proprietary or other confidential information therein, and could lead to disruptions in critical systems, unauthorized release of confidential or otherwise protected information and corruption or loss of data. Cybersecurity incidents may result from computer viruses, ransomware and other malware as well as human error, employee malfeasance, system errors or vulnerabilities, including vulnerabilities of our vendors, suppliers, and their products. Also, given the unpredictability of the timing, nature and scope of cybersecurity threats and attacks, we may be unable to anticipate attempted security breaches and, in turn, implement adequate preventative measures. Any such security incidents could result in mandatory notification Table of Contents requirements and costly remediation measures, damage our relationships with our customers and suppliers, adversely affect our reputation, cause a loss of confidence in us, or expose us to costly government enforcement investigations or actions, private litigation, or financial liability, possibly beyond the scope or limits of our insurance coverage. Such events may also disrupt our operations by distracting our management and other key personnel from performing their primary operational duties. Furthermore, mitigating the risk of future cybersecurity incidents could result in additional costs in order to invest in technology and personnel. In addition, our systems and processes to protect against, detect, prevent, respond to and mitigate cybersecurity incidents and our organizational training for employees to develop an understanding of cybersecurity risks and threats may be unable to prevent security breaches, theft, modification, corruption or loss of data, employee malfeasance and additional known and unknown threats. Any breach in our systems or data-protection policies, or those of our third-party service providers, could have a material adverse effect on our business, financial condition and results of operations. Corporate responsibility, specifically related to ESG matters, may impose additional costs and expose us to new risks. Public ESG and sustainability reporting is becoming more broadly expected by investors, shareholders and other third parties. Certain organizations that provide corporate governance and other corporate risk information to investors and shareholders have developed, and others may in the future develop, scores and ratings to evaluate companies and investment funds based upon ESG or sustainability metrics. Many investment funds focus on positive ESG business practices and sustainability scores when making investments and may consider a company s ESG or sustainability scores as a reputational or other factor in making an investment decision. In addition, investors, particularly institutional investors, use these scores to benchmark companies against their peers and if a company is perceived as lagging, these investors may engage with such company to improve ESG disclosure or performance and may also make voting decisions, or take other actions, to hold these companies and their boards of directors accountable. Board diversity is an ESG topic that is, in particular, receiving heightened attention by investors, shareholders, lawmakers and listing exchanges. We may face reputational damage in the event our corporate responsibility initiatives or objectives, including with respect to board diversity, do not meet the standards set by our investors, shareholders, lawmakers, listing exchanges or other constituencies, or if we are unable to achieve an acceptable ESG or sustainability rating from third party rating services. A low ESG or sustainability rating by a third-party rating service could also result in the exclusion of our ordinary shares from consideration by certain investors who may elect to invest with our competition instead. Ongoing focus on corporate responsibility matters by investors and other parties as described above may impose additional costs or expose us to new risks. If we are not able to maintain and enhance our brands, or if events occur that damage our reputation and brand, our ability to maintain and expand our customer base may be impaired. The various local and regional brands under which we do business and their respective reputations have significantly contributed to the success of our business. Maintaining and enhancing our brands is critical to our ongoing success. Maintaining and enhancing our brands will depend largely on our ability to continue to provide useful, reliable and trustworthy products and provide products to the market in a manner which matches the lead times customers require. There is no certainty that we will continue to meet customer expectations and maintain our overall brand image. We may experience media, legislative or regulatory scrutiny of our impact on the environment, which may adversely affect our reputation. If we fail to provide adequate customer service, it could erode confidence in any one or more of our brands. As part of our broader branding and marketing strategy, we may choose to consolidate or change local or regional brands, which may result in us incurring impairment charges. We may also be subject to trademark or patent infringement claims relating to our key intellectual property. If we fail to promote and maintain our brands successfully or if we incur excessive expenses or impairment charges in this effort, it could have a material adverse effect on our business, financial condition and results of operations. Table of Contents Changes in tax laws could adversely affect us. We regularly assess our future ability to utilize tax benefits, including those in the form of certain tax carryforwards, that are recorded as deferred income tax assets on our balance sheets to determine whether a valuation allowance is necessary. A reduction in, or disallowance of, these tax benefits resulting from a legislative change or adverse determination by a taxing jurisdiction could have an adverse impact on our financial results and liquidity. Significant judgment is required in determining our domestic and international provision for income taxes, deferred tax assets or liabilities and in evaluating our tax positions on a worldwide basis. In the course of our business, there will be many transactions and calculations where the ultimate tax determination is uncertain. For example, compliance with the Tax Cuts and Jobs Act of 2017 ( TCJA ) may require the collection of information not regularly produced within our Company, the use of estimates in our consolidated financial statements, and the exercise of significant judgment in accounting for its provisions. While we believe our tax positions are consistent with the tax laws in the jurisdictions in which we conduct our business, it is possible these positions may be contested or overturned by jurisdictional tax authorities, which may have a significant impact on our tax provision for income taxes. Tax laws are dynamic and subject to change as new laws are passed and new interpretations of the laws are issued or applied. Insufficient insurance coverage could have a material adverse effect on us. We maintain property, business interruption, counterparty and liability insurance coverage that we believe is consistent with industry practice. However, our insurance program does not cover, or may not adequately cover, every potential risk associated with our business and the consequences thereof. In addition, market conditions or any significant claim or a number of claims made by or against us could cause our premiums and deductibles to increase substantially and, in some instances, our coverage may be reduced or become entirely unavailable. In the future, we may not be able to obtain meaningful coverage at reasonable rates for a variety of risks. We also operate a large fleet of trucks and other vehicles and therefore face the risk of accidents. While we currently maintain insurance coverage to address a portion of these types of liabilities, we cannot make assurances that we will be able to obtain such insurance on acceptable terms in the future, if at all, or that any such insurance will provide adequate coverage against potential claims. If our insurance coverage is insufficient, if we are not able to obtain sufficient coverage in the future, or if we are exposed to significant losses as a result of the risks for which we self-insure, any resulting costs or liabilities could have a material adverse effect on our business, financial condition and results of operations. We have identified material weaknesses in our internal control over financial reporting. If we are unable to remediate our material weaknesses, or if we otherwise fail to establish and maintain effective internal control over financial reporting, we may be unable to produce timely and accurate financial statements, and we may conclude that our internal control over financial reporting is not effective, which could adversely impact our investors confidence and, as a result, the value of our common stock. We are not currently required to comply with the rules and regulations of the SEC to make an assessment of the effectiveness of internal control over financial reporting for that purpose. We are actively conducting a comprehensive review of our internal processes for the purposes of establishing a robust compliance program to meet the internal control requirements for a publicly traded company. We have not completed an assessment of the effectiveness of our internal control over financial reporting, and our independent registered public accounting firm has not conducted an audit of our internal control over financial reporting. In connection with the preparation of our financial statements, we identified certain control deficiencies in the design and maintenance of our internal control over financial reporting that constituted material weaknesses in internal control over financial reporting. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility Table of Contents that a material misstatement of our annual or interim consolidated financial statements will not be prevented or detected on a timely basis. The material weaknesses relate to: We lack a sufficient complement of accounting and financial reporting resources with the appropriate level of knowledge, experience and training required to meet the reporting requirements of a publicly traded company. This material weakness contributed to the following additional material weaknesses: We did not design and maintain formal accounting policies, procedures and controls to support complete, accurate and timely financial accounting, reporting and disclosures, including with respect to revenue and period-end financial reporting. Also, we did not design and maintain effective controls relating to the accuracy and occurrence of the accounting for revenues to ensure the accuracy of customer order entry and master data, including price and ensure appropriate segregation of duties and controls to verify the financial statements are presented and disclosed completely and accurately; We did not design and maintain effective controls over segregation of duties related to journal entries and account reconciliations. Specifically, certain personnel have the ability to both create and post journal entries and also prepare account reconciliations. These material weaknesses resulted in the revision of our consolidated financial statements for each of the quarterly periods ended October 3, 2021 and July 4, 2021 and for the period from January 21, 2021 to April 4, 2021 (Successor) and as of January 3, 2021 and for the period from January 4, 2021 to January 20, 2021 and for each of the two years in the period ended January 3, 2021 and each of the quarterly periods ended January 3, 2021, October 4, 2020, July 5, 2020, and April 5, 2020 (Predecessor), and other immaterial adjustments for each relevant period. Additionally, these material weaknesses could result in a misstatement of substantially all of our accounts or disclosures that would result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or detected. We did not design and maintain effective controls over information technology ( IT ) general controls for information systems that are relevant to the preparation of our financial statements. Specifically, we did not design and maintain i) program change management controls to ensure that information technology program and data changes affecting financial IT applications and underlying accounting records are identified, tested, authorized and implemented appropriately; ii) user access controls to ensure appropriate segregation of duties and that adequately restrict user and privileged access to financial applications, programs, and data to appropriate Company personnel; and (iii) computer operations controls to ensure that critical batch jobs are monitored and data backups are authorized and monitored. These IT deficiencies did not result in any misstatements to the financial statements, however, the deficiencies, when aggregated, could impact the Company s ability to maintain effective segregation of duties, as well as the effectiveness of IT-dependent controls (such as automated controls that address the risk of material misstatement to one or more assertions, along with the IT controls and underlying data that support the effectiveness of system-generated data and reports) that could result in misstatements potentially impacting all financial statement accounts and disclosures that would result in a material misstatement to the annual or interim financial statements that would not be prevented or detected. We are in the process of implementing measures designed to improve our internal control over financial reporting to remediate these material weaknesses. These measures include: Actively recruiting and hiring additional accounting and financial reporting personnel with the requisite technical and SEC reporting experience combined with expanding the capabilities of existing accounting and financial reporting personnel through continuous training and education in the accounting and reporting requirements under SEC rules and regulations. Implementing formal policies, procedures and control activities combined with delivery of training on standards of documentary evidence. Table of Contents Designing and implementing procedures and controls to incorporate enhanced segregation of duties, documentation standards and review protocols within our processes associated with manual journal entries and account reconciliations. Designing and engaging in the implementation of an IT general controls framework that addresses risks associated with user access and security, application change management and computer operations. We cannot assure you that the measures we have taken to date, and are continuing to implement, will be sufficient to remediate the material weaknesses we have identified or avoid potential future material weaknesses. If the steps we take do not correct the material weakness in a timely manner, we will be unable to conclude that we maintain effective internal control over financial reporting. Accordingly, there could continue to be a reasonable possibility that a material misstatement of our financial statements would not be prevented or detected on a timely basis. If we fail to remediate our existing material weaknesses or identify new material weaknesses in our internal control over financial reporting, if we are unable to comply with the rules and regulations of the SEC in a timely manner, if we are unable to conclude that our internal controls over financial reporting are effective, or if our independent registered public accounting firm is unable to express an unqualified opinion as to the effectiveness of our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our common stock could be negatively affected. As a result of such failures, we could also become subject to investigations by the SEC or other regulatory authorities, and become subject to litigation from investors and stockholders, which could harm our reputation and financial condition or divert financial and management resources from our regular business activities. The unaudited pro forma financial information included in this prospectus may not be representative of our future results of operation and financial condition. The pro forma financial information contained in this prospectus is unaudited and is based, in part, on certain estimates and assumptions that we believe are reasonable. We cannot assure you that our estimates and assumptions will prove to be accurate over time. For example, we have made a preliminary allocation of the estimated purchase price paid as compared to the net assets acquired in the Reeb Acquisition, as if the Reeb Acquisition had closed on the dates indicated in the applicable pro forma presentations. When the actual calculation and allocation of the purchase price to net assets acquired is performed, it will be based on the net assets assumed at the effective date of the Reeb Acquisition and other information at that date to support the allocation of the fair values of the Reeb Companies assets and liabilities. Accordingly, the actual amounts of net assets will vary from the pro forma amounts, and the final valuation of the Reeb Companies may be materially different than as reflected in the unaudited pro forma financial data contained herein. See Unaudited Pro Forma Combined Financial Statements and the notes thereto for more information. As a result of the foregoing, the unaudited pro forma financial information contained in this prospectus may not reflect what our results of operations and financial condition would have been had we been a combined entity during the periods presented, or what our results of operations and financial condition will be in the future. The challenge of integrating previously independent businesses makes evaluating our business and our future financial prospects difficult. Risks Related to Our Indebtedness If we do not generate sufficient cash flows, we may be unable to service all of our indebtedness. To service our indebtedness, we will require a significant amount of cash. Our ability to generate cash, make scheduled payments on or refinance our debt obligations depends on our successful financial and operating performance, which will be affected by a range of economic, competitive and business factors, many of which are outside of our control. If our cash flow and capital resources are insufficient to fund our debt service obligations or to repay our debt as it becomes due, including the ABL Credit Agreement, which will mature prior to our 6.375% senior secured notes due 2026 (the Senior Secured Notes ), and the Term Loan Facility, which Table of Contents will mature in 2028, we may have to undertake alternative financing plans, such as refinancing or restructuring our debt, selling assets or operations, reducing or delaying capital investments or seeking to raise additional capital. Any refinancing of our debt could be at higher interest rates and may require us to comply with more restrictive covenants which could further restrict our business operations and the ability of subsidiaries to make cash available to us, by dividend, debt repayment or otherwise, to enable us to repay the amounts due. Our ability to implement successfully any such alternative financing plans will be dependent on a range of factors, including general economic conditions, the level of activity in capital markets generally and the terms of our various debt instruments then in effect. In addition, the Senior Secured Notes, the Term Loan Facility and the ABL Credit Agreement are secured by liens on substantially all of our and the Subsidiary Guarantors assets, and any successor credit facilities or additional Senior Secured Notes are likely to be secured on a similar basis. As such, our ability to refinance the Senior Secured Notes, the Term Loan Facility and/or the ABL Credit Agreement, seek additional financing or our and our subsidiaries ability to make cash available to us, by dividend, debt repayment or otherwise, to enable the Co-Issuers to repay the amounts due under the Senior Secured Notes, the Term Loan Facility and/or the ABL Credit Agreement could be impaired as a result of such security interests and the agreements governing such security interests. Our inability to generate sufficient cash flow to satisfy our debt obligations or to refinance our obligations on commercially reasonable terms could have a material adverse effect on our business, including our financial condition and results of operations, as well as on our subsidiaries ability to make cash available to us, by dividend, debt repayment or otherwise, to enable us to satisfy our obligations on the Senior Secured Notes, the Term Loan Facility and/or the ABL Credit Agreement. Our substantial level of indebtedness could adversely affect our financial condition and prevent us from making payments on the Senior Secured Notes and our other debt obligations. We have a substantial amount of debt. At January 2, 2022, we had approximately $1.7 billion of total indebtedness, of which approximately $1.7 billion would have been secured indebtedness. See Capitalization. Our substantial level of indebtedness could have important consequences to you. For example, it could: make it more difficult for us to satisfy our obligations; increase our vulnerability to adverse economic and industry conditions; limit our ability to obtain additional financing for future working capital, capital expenditures, materials, strategic acquisitions and other general corporate requirements; expose us to interest rate fluctuations because the interest on the debt under the ABL Credit Agreement is imposed at variable rates; require us to dedicate a substantial portion of our cash flow from operations to payments on our debt, thereby reducing the availability of our cash flow for operations and other purposes, including making cash available to the Co-Issuers, by dividend, debt repayment or otherwise to enable the Co-Issuers to make payments on the Senior Secured Notes; make it more difficult for us to satisfy our obligations to our lenders, resulting in possible defaults on and acceleration of such indebtedness; limit our ability to refinance indebtedness or increase the associated costs; require us to sell assets to reduce debt or influence our decision about whether to do so; limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate or prevent us from carrying out capital spending that is necessary or important to our growth strategy and efforts to improve operating margins or our business; and Table of Contents place us at a competitive disadvantage compared to any competitors that have less debt or comparable debt at more favorable interest rates and that, as a result, may be better positioned to withstand economic downturns. In addition, the Indenture governing the Senior Secured Notes, the Term Loan Facility and the ABL Credit Agreement contain restrictive covenants that limit our and our subsidiaries ability to engage in activities that may be in our long-term best interests. Restrictive covenants in the Indenture governing the Senior Secured Notes, the Term Loan Facility and the ABL Credit Agreement could restrict our operating flexibility. The Indenture governing the Senior Secured Notes, the Term Loan Facility credit agreement (the Term Loan Credit Agreement ) and the ABL Credit Agreement contain covenants that limit our ability to take certain actions. These restrictions may limit our ability to operate our businesses and may prohibit or limit our ability to enhance our operations or take advantage of potential business opportunities as they arise. The Indenture governing the Senior Secured Notes, Term Loan Credit Agreement and the ABL Credit Agreement contain restrictive covenants that, among other things, limit our and/or our restricted subsidiaries ability to: incur additional indebtedness or issue certain preferred stock; pay dividends, redeem stock or make other distribution; make other restricted payments or investments; create liens on assets; transfer or sell assets; create restrictions on payment of dividends or other amounts by us to our restricted subsidiaries; engage in certain mergers, consolidations or amalgamations of the Parent Guarantor or the Co-Issuers; engage in certain transactions with affiliates; and designate our subsidiaries as unrestricted subsidiaries. In addition, under the ABL Credit Agreement, if availability goes below a certain threshold, the Company is required to comply with a minimum consolidated fixed charge coverage ratio (as defined in the ABL Credit Agreement). Our ability to comply with the covenants and restrictions contained in the Indenture governing the Senior Secured Notes, the ABL Credit Agreement and Term Loan Credit Agreement may be affected by economic conditions and by financial, market and competitive factors, many of which are beyond our control. Our ability to comply with these covenants in future periods will also depend substantially on the pricing and sales volume of our products, our success at implementing cost reduction initiatives and our ability to successfully implement our overall business strategy. The breach of any of these covenants or restrictions could result in a default under the Indenture governing the Senior Secured Notes, the ABL Credit Agreement or the Term Loan Credit Agreement that would permit the holders or applicable lenders to declare all amounts outstanding thereunder to be due and payable, together with accrued and unpaid interest and any applicable redemption premium. In that case, the applicable borrowers may be unable to borrow under the ABL Credit Agreement or the Term Loan Credit Agreement and the Co-Issuers may be unable to issue Additional Senior Secured Notes under the Indenture, may not be able to repay the amounts due under the ABL Credit Agreement or the Term Loan Facility and may not be able to make payments on the Senior Secured Notes. This could have serious consequences to our financial position, results of operations and/or cash flows and could cause us to become bankrupt or insolvent. Table of Contents Indebtedness under our Term Loan Credit Agreement, ABL Credit Agreement and Account Purchase Agreement bears interest based on the London Interbank Offered Rate ( LIBOR ), which may be subject to regulatory guidance and/or reform that could cause interest rates under our current or future debt agreements to perform differently than in the past or cause other unanticipated consequences. The ICE Benchmark Administration, the administrator of LIBOR, announced on March 5, 2021 its intent to cease publication of LIBOR rates (i) with respect to U.S. dollar LIBOR with interest periods of 1 week and 2 months, after December 31, 2021 and (ii) with respect to U.S. dollar LIBOR with all other interest periods, after June 30, 2023, and as a result, methods of calculating LIBOR are evolving. We may need to renegotiate the terms of our Term Loan Credit Agreement, ABL Credit Agreement and Account Purchase Agreement to replace LIBOR with the new standard, such as the Secured Overnight Financing Rate (SOFR), or to otherwise agree with the agent under such facilities on a new means of calculating interest. At this time we cannot reasonably estimate the expected impact on our business of the discontinuation of LIBOR. Risks Related to Our Common Stock and This Offering SBP Varsity Holdings controls us, and its interests may conflict with ours or yours in the future. Immediately following this offering, SBP Varsity Holdings, an entity controlled by funds advised by The Jordan Company, will beneficially own approximately % of our common stock, or % if the underwriters exercise in full their option to purchase additional shares in this offering. As a result, SBP Varsity Holdings will be able to control the election and removal of directors on the Board and thereby determine our corporate and management policies, including potential mergers or acquisitions, payment of dividends, asset sales, amendment of our certificate of incorporation or bylaws, and other significant corporate transactions for so long as it and its affiliates retain significant ownership of us. This concentration of our ownership may delay or deter possible changes in control of the Company, which may reduce the value of an investment in our common stock. Even when SBP Varsity Holdings and its affiliates cease to own shares of our stock representing a majority of the total voting power, for so long as SBP Varsity Holdings and its affiliates continue to own a significant portion of our stock, it will still be able to significantly influence the composition of our Board and the approval of actions requiring shareholder approval. Accordingly, for such period of time, SBP Varsity Holdings (and indirectly, The Jordan Company) will have significant influence with respect to our management, business plans and policies, including the appointment and removal of our officers, decisions on whether to raise future capital, and amending our charter and bylaws, which govern the rights attached to our common stock. In particular, for so long as SBP Varsity Holdings and its affiliates continue to beneficially own a significant percentage of our stock, it could cause or prevent a change of control of the Company or a change in the composition of our Board and could preclude any unsolicited acquisition of us. The concentration of ownership could deprive you of an opportunity to receive a premium for your shares of common stock as part of a sale of us and ultimately might affect the market price of our common stock. In addition, in connection with this offering, we will enter into the Director Nomination Agreement with SBP Varsity Holdings that provides it the right, but not the obligation, to nominate a number of individuals designated for election as our directors at any meeting of our stockholders (the Varsity Directors ), such that, upon the election of each such individual, and each other individual nominated by or at the direction of our board of directors or a duly-authorized committee of the board, as a director of our company, the number of Varsity Directors serving as directors of our Company will be equal to: (i) if SBP Varsity Holdings and its affiliates together continue to beneficially own at least 50% of the total number of shares of our common stock entitled to vote generally in the election of directors ( Total Outstanding Securities ), the lowest whole number that is greater than 50% of the total number of directors comprising our board of directors; (ii) if SBP Varsity Holdings and its affiliates together continue to beneficially own at least 40% (but less than 50%) of the Total Outstanding Securities, the lowest whole number that is at least 40% of the total number of directors comprising our board of directors; (iii) if SBP Varsity Holdings and its affiliates together continue to beneficially own at least 30% (but less than 40%) of the Total Outstanding Securities, the lowest whole number that is at least 30% of the total number of directors comprising our board of directors; (iv) if SBP Varsity Holdings and its affiliates together Table of Contents continue to beneficially own at least 20% (but less than 30%) of the Total Outstanding Securities, the lowest whole number that is at least 20% of the total number of directors comprising our board of directors; and (v) if SBP Varsity Holdings and its affiliates together continue to beneficially own at least 10% (but less than 20%) of the Total Outstanding Securities, the lowest whole number that is at least 10% of the total number of directors comprising our board of directors. SBP Varsity Holdings may also assign such right to its affiliates. The Director Nomination Agreement will also provide for certain consent rights for SBP Varsity Holdings so long as it and its affiliates own at least 50% of the Total Outstanding Securities. Additionally, the Director Nomination Agreement will also prohibit us from increasing or decreasing the size of our Board without the prior written consent of SBP Varsity Holdings for so long as SBP Varsity Holdings and its affiliates hold at least 40% of the Total Outstanding Securities. See Certain Relationships and Related Party Transactions Director Nomination Agreement for more details with respect to the Director Nomination Agreement. The Jordan Company, its Affiliated Companies and Exempted Persons (both as defined in the certificate of incorporation) engage in a broad spectrum of activities, including investments in our industry generally. In the ordinary course of their business activities, The Jordan Company, its Affiliated Companies and Exempted Persons (both as defined in the certificate of incorporation) including SBP Varsity Holdings, may engage in activities where their interests conflict with our interests or those of our other shareholders, such as investing in or advising businesses that directly or indirectly compete with certain portions of our business or are suppliers or clients of ours. Our certificate of incorporation to be effective in connection with the closing of this offering will provide that none of The Jordan Company, its Affiliated Companies and Exempted Persons (both as defined in the certificate of incorporation) will have any duty to refrain from engaging, directly or indirectly, in the same business activities or similar business activities or lines of business in which we operate. The Jordan Company, its Affiliated Companies and Exempted Persons (both as defined in the certificate of incorporation) also may pursue acquisition opportunities that may be complementary to our business, and, as a result, those acquisition opportunities may not be available to us. In addition, The Jordan Company, its Affiliated Companies and Exempted Persons (both as defined in the certificate of incorporation) may have an interest in pursuing acquisitions, divestitures and other transactions that, in their judgment, could enhance their investment, even though such transactions might involve risks to you. We are a holding company with no operations of our own, and we depend on our subsidiaries for cash to fund all of our operations and expenses, including to make future dividend payments, if any. Our operations are conducted entirely through our subsidiaries, and our ability to generate cash to fund operations and expenses, to pay dividends or to meet debt service obligations is highly dependent on the earnings and the receipt of funds from our subsidiaries through dividends or intercompany loans. Deterioration in the financial condition, earnings or cash flow of our subsidiaries for any reason could limit or impair their ability to pay such distributions to us. Additionally, the terms of the agreements governing the ABL Credit Agreement, the Senior Secured Notes and the Term Loan Facility restrict the ability of our subsidiaries to pay dividends, make loans or otherwise transfer assets to us. Furthermore, our subsidiaries are permitted under the terms of the ABL Credit Agreement, Term Loan Credit Agreement and Senior Secured Notes and other indebtedness to incur additional indebtedness that may restrict or prohibit the making of distributions, the payment of dividends or the making of loans by such subsidiaries to us. In addition, Delaware law may impose requirements that may restrict our ability to pay dividends to holders of our common stock. We do not currently expect to declare or pay dividends on our common stock for the foreseeable future. Payments of dividends, if any, will be at the sole discretion of our board of directors after taking into account various factors, including general and economic conditions, our financial condition and operating results, our available cash and current and anticipated cash needs, capital requirements, contractual, legal, tax and regulatory restrictions and implications of the payment of dividends by us to our stockholders or by our subsidiaries to us, and such other factors as our board of directors may deem relevant. In addition, Delaware law may impose Table of Contents requirements that may restrict our ability to pay dividends to holders of our common stock. To the extent that we determine in the future to pay dividends on our common stock, none of our subsidiaries will be obligated to make funds available to us for the payment of dividends. The market price of our common stock may be volatile and could decline after this offering. Volatility in the market price of our common stock may prevent you from being able to sell your shares at or above the price you paid for your shares. The market price of our common stock may fluctuate significantly. Among the factors that could affect our stock price are: industry or general market conditions; domestic and international economic factors unrelated to our performance; changes in our customers or their end-users preferences; new regulatory pronouncements and changes in regulatory guidelines; lawsuits, enforcement actions and other claims by third parties or governmental authorities; actual or anticipated fluctuations in our quarterly operating results; changes in securities analysts estimates of our financial performance or lack of research coverage and reports by industry analysts; action by institutional stockholders or other large stockholders, including future sales; failure to meet any guidance given by us or any change in any guidance given by us, or changes by us in our guidance practices; announcements by us of significant impairment charges; speculation in the press or investment community; investor perception of us and our industry; changes in market valuations or earnings of similar companies; announcements by us or our competitors of significant contracts, acquisitions, dispositions or strategic partnerships; war, terrorist acts and epidemic disease; any future sales of our common stock or other securities; and additions or departures of key personnel. In particular, we cannot assure you that you will be able to resell your shares at or above your purchase price. The stock markets have experienced extreme volatility in recent years that has been unrelated to the operating performance of particular companies. These broad market fluctuations may adversely affect the trading price of our common stock. In the past, following periods of volatility in the market price of a company s securities, class action litigation has often been instituted against the affected company. Any litigation of this type brought against us could result in substantial costs and a diversion of our management s attention and resources, which would harm our business, results of operations, financial condition and cash flows. Future sales of shares by existing stockholders could cause our stock price to decline. Sales of substantial amounts of our common stock in the public market following this offering, or the perception that these sales could occur, could cause the market price of our common stock to decline. These sales, or the possibility that these sales may occur, also might make it more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate. Table of Contents After giving effect to the Stock Split and sale of shares in this offering, we will have outstanding shares of common stock. All of the shares sold pursuant to this offering will be immediately tradable without restriction under the Securities Act of 1933, as amended, or the Securities Act, except for any shares held by affiliates, as that term is defined in Rule 144 under the Securities Act, or Rule 144. The remaining shares of common stock will be restricted securities within the meaning of Rule 144 under the Securities Act, but will be eligible for resale subject to applicable volume, means of sale, holding period and other limitations of Rule 144 under the Securities Act or pursuant to an exception from registration under Rule 701 under the Securities Act, subject to the lock-up agreements entered into by us, and our executive officers and directors. Upon completion of this offering, we intend to file one or more registration statements on Form S-8 under the Securities Act to register the shares of common stock to be issued under our equity compensation plans and, as a result, all shares of common stock acquired under our plans will also be freely tradable under the Securities Act, subject to the terms of the lock-up agreements, unless purchased by our affiliates. In addition, shares of our common stock will be reserved for future issuances under the equity incentive plans we expect to adopt in connection with this offering. We and our officers, directors, and holders of substantially all of our common stock have agreed with the underwriters, subject to certain exceptions, not to dispose of or hedge any of their common stock or securities convertible into or exchangeable for shares of common stock during the period from the date of this prospectus continuing through the date 180 days after the date of this prospectus, except with the prior written consent of Barclays Capital Inc. and Goldman Sachs & Co. LLC. Following the expiration of this 180-day lock-up period, shares of our common stock will be eligible for future sale, subject to the applicable volume, manner of sale, holding period and other limitations of Rule 144 under the Securities Act or pursuant to an exception from registration under Rule 701 under the Securities Act. See Shares Available for Future Sale for a discussion of the shares of common stock that may be sold into the public market in the future. In addition, our significant stockholders may distribute shares that they hold to their investors who themselves may then sell into the public market following the expiration of the lock-up period. Such sales may not be subject to the volume, manner of sale, holding period and other limitations of Rule 144 under the Securities Act. As resale restrictions end, the market price of our common stock could decline if the holders of those shares sell them or are perceived by the market as intending to sell them. Furthermore, stockholders currently representing substantially all of the outstanding shares of our common stock will have the right to require us to register shares of common stock for resale under the Securities Act. In the future, we may issue additional shares of common stock or other equity or debt securities convertible into common stock in connection with a financing, acquisition, litigation settlement or employee arrangement or otherwise. Any of these issuances could result in substantial dilution to our existing stockholders and could cause the trading price of our common stock to decline. Upon listing our shares on Nasdaq, we will be a controlled company within the meaning of Nasdaq rules and, as a result, we will qualify for, and intend to rely on, exemptions from certain corporate governance requirements. You will not have the same protections as those afforded to stockholders of companies that are subject to such governance requirements. After completion of this offering, SBP Varsity Holdings will continue to control a majority of the voting power of our outstanding common stock. As a result, we will be a controlled company within the meaning of the corporate governance standards of Nasdaq. Under these rules, a company of which more than 50% of the voting power for the election of directors is held by an individual, group or another company is a controlled company and may elect not to comply with certain corporate governance requirements, including: the requirement that a majority of our Board consist of independent directors; Table of Contents the requirement that we have a nominating and corporate governance committee that is composed entirely of independent directors with a written charter addressing the committee s purpose and responsibilities; and the requirement that we have a compensation committee that is composed entirely of independent directors with a written charter addressing the committee s purpose and responsibilities. Although we do not intend to utilize these exemptions immediately following this offering, we may elect to do so in the future. As a result, we may not have a majority of independent directors on our Board and our Compensation Committee and Nominating & Governance Committee may not consist entirely of independent directors. Accordingly, you may not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements of other companies listed on Nasdaq. If securities or industry analysts do not publish research or publish misleading or unfavorable research about our business, our stock price and trading volume could decline. The trading market for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. We do not currently have and may never obtain research coverage by securities and industry analysts. If there is no coverage of our company by securities or industry analysts, the trading price for our stock would be negatively impacted. In the event we obtain securities or industry analyst coverage, if one or more of these analysts downgrades our stock or publishes misleading or unfavorable research about our business, our stock price may decline. If one or more of these analysts ceases coverage of our company or fails to publish reports on us regularly, demand for our stock could decrease, which could cause our stock price or trading volume to decline. Future offerings of equity securities may adversely affect the market price of our common stock. If, in the future, we decide to issue debt or equity securities that rank senior to our common stock, it is likely that such securities will be governed by an indenture or other instrument containing covenants restricting our operating flexibility. Additionally, any convertible or exchangeable securities that we issue in the future may have rights, preferences and privileges more favorable than those of our common stock and may result in dilution to owners of our common stock. We and, indirectly, our stockholders, will bear the cost of issuing and servicing such securities. Because our decision to issue debt or equity securities in any future offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing or nature of our future offerings. Thus, holders of our common stock will bear the risk of our future offerings reducing the market price of our common stock and diluting the value of their stock holdings in us. Anti-takeover provisions in our amended and restated certificate of incorporation and amended and restated by-laws could discourage, delay or prevent a change of control of our company and may affect the trading price of our common stock. Our amended and restated certificate of incorporation and amended and restated by-laws include a number of provisions that may discourage, delay or prevent a change in our management or control over us that stockholders may consider favorable. For example, prior to the completion of this offering, our amended and restated certificate of incorporation and amended and restated by-laws will collectively: allow us to authorize the issuance of undesignated preferred stock, the terms of which may be established and the shares of which may be issued without shareholder approval, and which may include supermajority voting, special approval, dividend or other rights or preferences superior to the rights of shareholders; provide for a classified Board with staggered three-year terms; Table of Contents provide that, at any time when The Jordan Company and its affiliated companies beneficially own, in the aggregate, less than 45% in voting power of our stock entitled to vote generally in the election of directors ( Voting Stock ), directors may only be removed for cause, and only by the affirmative vote of holders of at least 662/3% in voting power of all the then-outstanding shares of our stock entitled to vote thereon, voting together as a single class; prohibit shareholder action by written consent from and after the date on The Jordan Company and its affiliated companies which beneficially own, in the aggregate, less than 45% of the Voting Stock; provide that, for as long as The Jordan Company and its affiliated companies beneficially own, in the aggregate, at least 50% of the Voting Stock, any amendment, alteration, rescission or repeal of our bylaws by our shareholders will require the affirmative vote of a majority in voting power of the outstanding shares of our stock entitled to vote thereon voting together as a single class, and at any time when The Jordan Company and its affiliated companies beneficially own, in the aggregate, less than 50% of the Voting Stock, any amendment, alteration, rescission or repeal of our bylaws by our shareholders will require the affirmative vote of the holders of at least 662/3% in voting power of all the then-outstanding shares of our stock entitled to vote thereon, voting together as a single class; and establish advance notice requirements for nominations for elections to our Board or for proposing matters that can be acted upon by shareholders at shareholder meetings. These provisions may prevent our stockholders from receiving the benefit from any premium to the market price of our common stock offered by a bidder in a takeover context. Even in the absence of a takeover attempt, the existence of these provisions may adversely affect the prevailing market price of our common stock if the provisions are viewed as discouraging takeover attempts in the future. Our amended and restated certificate of incorporation and amended and restated by-laws may also make it difficult for stockholders to replace or remove our management. Furthermore, the existence of the foregoing provisions, could limit the price that investors might be willing to pay in the future for shares of our common stock. These provisions may facilitate management entrenchment that may delay, deter, render more difficult or prevent a change in our control, which may not be in the best interests of our stockholders. We do not intend to pay dividends on our common stock and, consequently, your ability to achieve a return on your investment will depend on appreciation in the price of our common stock. As a public company, we do not intend to declare and pay dividends on our common stock for the foreseeable future. We currently intend to invest our future earnings, if any, to fund our growth, to develop our business, for working capital needs and for general corporate purposes. Therefore, you are not likely to receive any dividends on your common stock for the foreseeable future and the success of an investment in shares of our common stock will depend upon any future appreciation in their value. There is no guarantee that shares of our common stock will appreciate in value or even maintain the price at which our stockholders have purchased their shares. In addition, our operations are conducted entirely through our subsidiaries. As such, to the extent that we determine in the future to pay dividends on our common stock, none of our subsidiaries will be obligated to make funds available to us for the payment of dividends. Further, the agreements governing the ABL Credit Agreement, Term Loan Credit Agreement and the Senior Secured Notes significantly restrict the ability of our subsidiaries to pay dividends or otherwise transfer assets to us. Table of Contents Our amended and restated certificate of incorporation will designate the Court of Chancery of the State of Delaware as the exclusive forum for certain litigation that may be initiated by our stockholders, which could limit our stockholders ability to obtain a favorable judicial forum for disputes with us. Our amended and restated certificate of incorporation will provide that the Court of Chancery of the State of Delaware will, to the fullest extent permitted by law, be the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed to us, our stockholders, creditors or other constituents by any of our directors, officers, other employees, agents or stockholders, (iii) any action asserting a claim arising under the General Corporation Law of the State of Delaware, or the DGCL, our amended and restated certificate of incorporation or our amended and restated by-laws, or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware or (iv) any action asserting a claim that is governed by the internal affairs doctrine, or the Delaware Forum Provision. The Delaware Forum Provision will not apply to any causes of action arising under the Securities Act or the Exchange Act. Our amended and restated certificate of incorporation will further provide that unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States shall be the sole and exclusive forum for resolving any complaint asserting a cause of action arising under the Securities Act (the Federal Forum Provision). By becoming a stockholder in our company, you will be deemed to have notice of and have consented to the provisions of our amended and restated certificate of incorporation related to choice of forum. The Delaware Forum Provision and the Federal Forum Provision in our amended and restated certificate of incorporation may impose additional litigation costs on stockholders in pursuing any such claims. Additionally, these forum selection clauses in our amended and restated certificate of incorporation may limit our stockholders ability to bring a claim in a judicial forum that they find favorable for disputes with us or our directors, officers or employees, which may discourage the filing of such lawsuits against us and our directors, officers and employees even though an action, if successful, might benefit our stockholders. In addition, while the Delaware Supreme Court ruled in March 2020 that federal forum selection provisions purporting to require claims under the Securities Act be brought in federal court are facially valid under Delaware law, there is uncertainty as to whether other courts will enforce our Federal Forum Provision. If the Federal Forum Provision is found to be unenforceable, we may incur additional costs associated with resolving such matters. The Federal Forum Provision may also impose additional litigation costs on stockholders who assert that the provision is not enforceable or invalid. The Court of Chancery of the State of Delaware and the federal district courts of the United States may also reach different judgments or results than would other courts, including courts where a stockholder considering an action may be located or would otherwise choose to bring the action, and such judgments may be more or less favorable to us than our stockholders. If a court were to find the choice of forum provision contained in our amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, results of operations and financial condition. Investors purchasing common stock in this offering will experience immediate and substantial dilution as a result of this offering and future equity issuances. The initial public offering price per share will significantly exceed the net tangible book value per share of our common stock outstanding. As a result, investors purchasing common stock in this offering will experience immediate substantial dilution of $ per share, based on an assumed initial public offering price of $ , the midpoint of the price range reflected on the cover of this prospectus. This dilution is due in large part to the fact that our earlier investors paid substantially less than the initial public offering price when they purchased their shares. Investors purchasing shares of common stock in this offering will contribute approximately % of the total amount of equity invested in our company, but will own only approximately % of our total common stock immediately following the completion of this offering. In addition, if we issue additional equity securities in the future, investors purchasing common stock in this offering will experience additional dilution. Table of Contents
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before making an investment decision. Unless otherwise stated in this prospectus or the context otherwise requires, references to: Unless otherwise stated in this prospectus or the context otherwise requires, references to: we, us, our , the company or KnightSwan are to KnightSwan Acquisition Corporation, a Delaware corporation; amended and restated certificate of incorporation are to our amended and restated certificate of incorporation to be in effect upon the completion of this offering; completion window are to (i) the 18-month period from the closing of this offering in which we must complete an initial business combination, (ii) the 21-month or 24-month, as applicable, period from the closing of this offering in which we must complete an initial business combination if our sponsor has extended the period of time for us to consummate our initial business combination by depositing additional funds into the trust account, or (iii) such other extended time period in which we must complete an initial business combination pursuant to an amendment to our amended and restated certificate of incorporation; common stock are to our Class A common stock and our Class B common stock; directors are to our current directors and our director nominees named in this prospectus; equity-linked securities are to any debt or equity securities that are convertible, exercisable or exchangeable for shares of our Class A common stock issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt; founder shares are to shares of our Class B common stock and shares of our Class A common stock issued upon the conversion thereof; initial stockholders are to holders of our founder shares prior to this offering; letter agreement refers to the letter agreement, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management, our management team or our team are to our officers and directors; public warrants are to the warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); private placement warrants are to the warrants issued to our sponsor in a private placement transaction simultaneously with the closing of this offering and upon conversion of working capital loans, if any, subsequent to the consummation of this offering and to the warrants issued in connection with our sponsor electing to exercise its option to extend the completion window; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our sponsor, officers, directors and advisors to the extent our sponsor, officers, directors and/or advisors purchase public shares, provided that their status as a public stockholder shall only exist with respect to such public shares; Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED JANUARY 14, 2022 PRELIMINARY PROSPECTUS $200,000,000 KnightSwan Acquisition Corporation 20,000,000 Units KnightSwan Acquisition Corporation is a blank check company formed for the purpose of effecting a merger, consolidation, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses or entities. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one share of our Class A common stock and one-half of one redeemable public warrant. Each whole public warrant entitles the holder thereof to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as described in this prospectus, and only whole public warrants are exercisable. No fractional public warrants will be issued upon separation of the units and only whole public warrants will trade. The public warrants will become exercisable 30 days after the completion of our initial business combination, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. Subject to the terms and conditions described in this prospectus, we may redeem the public warrants once the public warrants become exercisable. We refer to these warrants throughout this prospectus as the public warrants. We have also granted the underwriter a 45-day option to purchase up to an additional 3,000,000 units. We will provide our public stockholders with the opportunity to redeem all or a portion of their shares of our Class A common stock in connection with our initial business combination at a per share price described herein, payable in cash, subject to the limitations described herein. If we have not completed our initial business combination within 18 months from the closing of this offering, which can be extended at our sponsor s option to up to 24 months or pursuant to an amendment to our amended and restated certificate of incorporation as described herein (the completion window ), we will redeem 100% of the public shares at a per share price described herein, payable in cash, subject to applicable law and as further described herein. Our sponsor, KnightSwan Sponsor LLC, has committed to purchase an aggregate of 11,750,000 private placement warrants at a price of $1.00 per private placement warrant ($11,750,000 in the aggregate) in a private placement transaction that will close simultaneously with the closing of this offering. Our sponsor has also committed to purchase up to an additional 1,350,000 private placement warrants, depending on the extent to which the underwriter s option to purchase additional units is exercised, at a price of $1.00 per private placement warrant ($1,350,000 in the aggregate), to add to the proceeds from this offering to be held in the trust account. Each private placement warrant entitles the holder thereof to purchase one share of our Class A common stock at $11.50 per share, subject to adjustment as described in this prospectus. Our sponsor has an option to deposit additional funds into the trust account in order to extend the completion window up to two times, each by an additional three months, for a total completion window of up to 24 months from the closing of this offering. As of the date of this prospectus, our initial stockholders hold 5,750,000 shares of Class B common stock. In addition, if the underwriter s option to purchase additional units is not exercised, our sponsor will forfeit to us an additional 750,000 founder shares upon the expiration of the underwriter s option to purchase additional units. The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of our initial business combination on a one-for-one basis, subject to adjustment as provided herein. Holders of our Class B common stock and holders of our Class A common stock will vote together as a single class on the election and removal of directors and any other matter submitted to a vote of our stockholders, except as required by applicable law or stock exchange rules. Prior to this offering, there has been no public market for our units, Class A common stock or public warrants. We have applied to list our units on the New York Stock Exchange, or the NYSE, under the symbol KNSW.U on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on the NYSE. The Class A common stock and public warrants constituting the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day), unless RBC Capital Markets, LLC informs us of its decision to allow earlier separate trading, subject to certain conditions. Once the securities constituting the units begin separate trading, we expect that the Class A common stock and public warrants will be listed on the NYSE under the symbols KNSW and KNSW WS, respectively. We are an emerging growth company and smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves risks. See Risk Factors. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Price to Public Underwriting Discounts and Commissions(1) Proceeds, before expenses, to us Per Share $ 10.00 $ 0.55 $ 9.45 Total $ 200,000,000 $ 11,000,000 $ 189,000,000 (1) Includes (i) $0.20 per unit (excluding any units sold pursuant to the underwriter s option to purchase additional units), or $4,000,000 (or up to $4,600,000 if the underwriter s over-allotment option is exercised in full) in the aggregate, payable upon the closing of this offering in cash and (ii) $0.35 per unit, or $7,000,000 (or up to $8,050,000 if the underwriter s option to purchase additional units is exercised in full) in the aggregate, payable to the underwriter for deferred underwriting commissions to be placed in a trust account located in the United States as described herein. The deferred commissions will be released to the underwriter only on completion of an initial business combination, in an amount equal to $0.35 multiplied by the number of shares of Class A common stock sold as part of the units in this offering, as described in this prospectus. Does not include certain fees and expenses payable to the underwriter in connection with this offering. See Underwriting for a description of compensation payable to the underwriter. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $205,000,000, or $235,750,000 if the underwriter s option to purchase additional units is exercised in full ($10.25 per unit), will be deposited into a U.S.-based trust account, with Continental Stock Transfer & Trust Company acting as trustee. The underwriter is offering the units for sale on a firm commitment basis. Delivery of the units will be made on or about , 2022. Neither the Securities and Exchange Commission, or the SEC, nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. RBC CAPITAL MARKETS The date of this prospectus is , 2022 Table of Contents specified future issuance are to any issuance by us of equity or equity-linked securities following this offering to raise additional capital to complete our initial business combination; provided that no such securities will have rights to any funds held in the trust account established in connection with this offering; sponsor are to KnightSwan Sponsor LLC, a Delaware limited liability company; warrants are, collectively, to the public warrants and the private placement warrants; and warrant agreements are, together, to our public warrant agreement and our private warrant agreement. Each unit consists of one share of Class A common stock and one-half of one warrant for each unit purchased. Each whole warrant entitles the holder thereof to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as described in this prospectus, and only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. If, upon separation of the units, a holder of warrants would be entitled to receive a fractional warrant, we will round down to the nearest whole number of warrants to be issued to such holder. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Unless notified otherwise, the information in this prospectus assumes that the underwriter will not exercise its over-allotment option. Our Company We are a newly formed blank check company incorporated as a Delaware corporation whose business purpose is to effect a merger, consolidation, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses or entities. We have not identified any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with respect to any potential business combination with us. KnightSwan, founded by Brandee Daly and Teresa Carlson, is an industry disruptor and catalyst for new and emerging technologies focused on accelerating innovation in cyber, cloud, and mission intelligence, a field focused on the collection, analysis, and delivery of foreign intelligence and counterintelligence information for the purposes of improving decision-making. Through this platform, KnightSwan intends to invest in a company that provides technologically-differentiated products and solutions to the commercial and government markets. KnightSwan believes that it has the chance to seize a timely and significant market opportunity. The U.S. Government continues to make large investments in cyber, cloud, and mission intelligence solutions, considering them critical to managing national security as well as integral to driving innovation and advancing technology. Our objective is to leverage the experience that our seasoned KnightSwan team has in leading and growing technology-focused organizations in both the public and private markets to effect an initial business combination that delivers value to our stockholders. The KnightSwan team plans to implement a sourcing strategy that leverages its extensive network of long-standing relationships to identify potential business combination targets. We seek to undertake a business combination with a company or companies that we believe are likely to benefit from the operational experience and leadership of our collective team. The KnightSwan team intends to leverage its substantial industry experience and global relationships with the goal of providing potential business combination targets with benefits that will create long-term value to our stockholders. We believe we can facilitate operational, financial, strategic and managerial improvements in the prospective combination partner company in order to achieve long-term sustainable growth for its stockholders. Table of Contents The KnightSwan team is comprised of Brandee Daly, our Chief Executive Officer, Teresa Carlson, our Non-Executive Chair of the board of directors, and Matthew McElroy, our Chief Financial Officer. Brandee Daly and Teresa Carlson are managing members of our sponsor, KnightSwan Sponsor LLC, a Delaware incorporated limited liability company. We are not required to complete our initial business combination with a company or companies that provide technology-enabled solutions with high-growth, mission-critical applications in the government and commercial-end markets. We may pursue our initial business combination outside of such markets. We may seek to acquire established businesses that we believe are fundamentally sound but potentially in need of financial, operational, strategic, or board-level insight to maximize value. We may also look at earlier stage companies that exhibit the potential to change the industries in which they operate, and which may offer the potential of sustained high levels of revenue and earnings growth. Our Competitive Strengths We believe the KnightSwan team and board of directors have a broad set of capabilities that will enable them to source, evaluate and execute a business combination for our stockholders and position a prospective partner company for success. The KnightSwan team and board of directors have far-reaching and long standing global relationships with relevant industry executives, management teams, multi-national corporations, financial institutions, security and defense agencies, U.S. and global government leaders, and multi-industry experts that we believe will contribute to our success. It is our belief that a prospective combination partner will benefit meaningfully from our competitive strengths, which include: Unique Perspectives Driving Opportunity: Targeting a focused sector with limited SPAC presence; success demands a competitive advantage that requires extensive relationships and subject matter expertise. Diversity is Our Strength: Trailblazers as one of the first women-owned and led SPACs, with a focus on one of the most innovative sectors of government technology and related commercial end-markets, providing a unique perspective into operational excellence. Diversity and transparent governance is at the core of our mission to target high-growth companies that rapidly accelerate public and private adoption of advanced, innovate, mission critical technologies and enables us to approach transaction execution through a distinctive lens and acquisition framework. Cloud Natives at the Forefront of Innovation: Experience truly born-in-the-cloud , with key team members having developed scalable and innovative cloud solution through Amazon Web Services. Our team s understanding of technology is fully-integrated into our approach to our strategy and differentiation. Proven Leadership and Ability to Execute: Legacy as successful founders, entrepreneurs, and operational leaders with significant experience buying and selling core-market companies. We believe that the KnightSwan team s deal expertise and shareholder value creation has been proven on the ground level in the operational trenches. Entrenched Sector Connections Provide Advantage: We believe our team s decades long relationships with key Department of Defense ( DoD ) and Intelligence Community ( IC ) agencies driving new business wins and competitive advantage. Ability to predict and adapt to the ever-changing future needs of these agencies provides industry-leading insights and access to proprietary sourcing networks. KnightSwan Team The KnightSwan team is led by Brandee Daly, our Chief Executive Officer, Teresa Carlson, our Non-Executive Chair of the board, and Matthew McElroy, our Chief Financial Officer. We believe KnightSwan Table of Contents is one of the first women-owned and led SPACs in the Government sector. Teresa Carlson and Brandee Daly have substantial government and commercial experience in leading disruptive and innovative growth companies. They plan to leverage their deep technology expertise and experience as entrepreneurs in the DoD and IC to assess the feasibility and differentiation of our targets solutions. Our management is further supported by our independent directors Anne K. Altman, Dr. Merlynn Carson, S. Leslie Ireland, Dawn Meyerriecks and Laura Price. Brandee Daly, the CEO of KnightSwan, is one of the leading women technology experts in government and business and has led an impressive 25-year career spanning roles at Amazon, Oracle, Microsoft, IBM, and the CIA. In 2021, Daly was named one of the Top 20 Cloud Execs to Watch in 2021 by WashingtonExec. Prior to KnightSwan, Ms. Daly was the founder and CEO of C2S Consulting Group ( C2SCG ), a leading provider of innovative solutions, prototypes, and delivery of Cloud Cyber Security to the U.S. Intelligence Community, DoD, and U.S. Federal Civilian Agencies. At C2SCG, Daly guided hundreds of businesses and public sector organizations to successfully migrate, manage, and optimize their technology and cloud automation. From 2018 to 2021, Ms. Daly successfully grew firm-wide revenue significantly, expanding the service offering to encompass cloud migration, cyber, architecture, DevOps / DevSecOps, and cloud business strategy. Under Ms. Daly s leadership, C2SCG became a multi-service global consulting firm, providing a range of technology consulting solutions to all 17 intelligence agencies, broader public sector, and commercial markets. Before founding C2SCG in 2015, Ms. Daly served as a Federal Account Executive at Amazon Web Services ( AWS ), cultivating executive relationships and accelerating sales and cloud adoption across IC and DoD government agencies. In this role, Ms. Daly directed a highly skilled team of personnel to offer a range of solutions to meet government missions including cloud defense and security solutions, AWS cloud architecture, application migration, DevOps, solutions to accelerate research and development (R&D), and IT business strategy services. At AWS, Ms. Daly built a highly skilled team of personnel with innovative technical expertise that is the leading provider of high-end cloud computing cyber security primarily supporting agencies across the U.S. Intelligence Community, offering Cloud Defense and Security solutions, AWS Cloud Architecture, Application Migration, DevOps, R&D, and IT Business Strategy services. While at Amazon, Ms. Daly won the 2015 Federal 100 award for Leading the Cloud Migration, one of the annual awards presented to the 100 women and men who personify what s possible in how the federal government acquires, develops, and manages IT. Prior to AWS, Ms. Daly held a similar role at Microsoft as a Principal Architect, responsible for managing customers, projects, and budgets in the government sector. Ms. Daly joined Microsoft from the CIA, where she developed a five-year IT strategy for the Agency and started four new divisions, including one directed at Cloud Transformation. While at the CIA, Ms. Daly won several Excellence Awards for her work in supporting the Mission. Ms. Daly s early career was spent at Oracle, where she served as the Technical Project Lead focused on application development for The President s Council for the Y2K Information Coordination Center. In this role, Ms. Daly built and designed requirements for an information portal with over 100,000 users worldwide and in 72 countries. Ms. Daly s work, and that of her team, became a foundation for what the cyber security industry is today. In 2000, under President Clinton, Ms. Daly was awarded the Directors Award for her work in preparing the U.S. Government for Y2K. That same year, Daly and her team received the Vice Presidential Hammer Award for Reinventing Government from Vice President Gore. Table of Contents Ms. Daly is a fierce advocate for supporting women s initiatives in both technology and sports and is a proud sponsor of the Washington Spirit, the women s professional soccer team in Washington, D.C. Ms. Daly received a Bachelor of Science in Systems and Industrial Engineering from University of Arizona and a Masters of Business Administration from American University. Teresa Carlson, the Non-Executive Chair of the board of directors of KnightSwan, is the President and Chief Growth Officer at Splunk Inc. (Nasdaq: SPLK) ( Splunk ). Ms. Carlson leads efforts to align and drive Splunk s ongoing business transformations and go-to-market segments. Prior to Splunk, Ms. Carlson spent a decade at Amazon, successfully launching Amazon s Worldwide Public Sector and Industries Division for AWS. During her tenure, Ms. Carlson grew the Public Sector Division from its inception and pioneered the U.S. Government s technological shift to the Cloud. Under her direction, AWS established the International Traffic in Arms Regulations (ITAR) compliant GovCloud (U.S.-East) region in 2011, the commercial cloud services (C2S) contract for the intelligence community in 2014, and a second GovCloud region (U.S.-West) in 2018, setting the stage for future cloud regions for the defense and intelligence community. More broadly, Ms. Carlson s strong belief that public sector customers should have access to the same advanced and innovative technology as startups led her to expand the scope of AWS in the public sector. Ms. Carlson has opened over 35 offices around the world, which now serve customers in over 172 countries. Ms. Carlson also created a startup, Envision Engineering, which was designed to quickly respond to the needs of governments and citizens during emergencies. Envision Engineering was instrumental in speeding governmental entities response to the COVID-19 pandemic. Today, and as a result of Ms. Carlson s vision and early incubation efforts, over 7,500 government agencies, over 14,000 academic institutions, and over 35,000 nonprofit organizations use AWS to meet their missions. Outside of the U.S., Ms. Carlson worked closely with governmental bodies, educational institutions, telecommunications providers, and other businesses to guide the launch of AWS in Bahrain in 2019. Ms. Carlson has worked closely across the Middle East to promote the Fourth Industrial Revolution (4IR) in region, expanding opportunities for businesses to leverage cloud technologies within Bahrain, Saudi Arabia, and the United Arab Emirates. Ms. Carlson actively cultivates diversity, and formed We Power Tech, the backbone of AWS diversity and inclusion initiatives, to ensure that underrepresented groups are reflected throughout all of AWS outreach efforts. Ms. Carlson and her team developed and launched other education initiatives including AWS Educate, which created two and four year cloud curricula for colleges and universities worldwide, as well as Tech U, a program designed to recruit and cultivate diverse talent through the organization. Prior to joining AWS, Ms. Carlson spent nearly a decade at Microsoft where she successfully launched the company s government agency division, Microsoft Federal. In her role, Ms. Carlson led strategy, execution of sales, partnering, contracting, business development, and performance world-wide. While overseeing Microsoft Federal, Ms. Carlson led Microsoft s first cloud-based U.S. Government Business Productivity Online Services (BPOS) Region, closed the first ever Office 365 deal with the U.S. Department of Agriculture, and closed the then-largest Enterprise Agreement with the U.S. Air Force, valued at over $330 million. As the leader of the U.S. Federal team, Ms. Carlson oversaw one of Microsoft s largest divisions. Ms. Carlson received a Bachelor s degree in Communication and a Master s Degree in Speech and Language Pathology from Western Kentucky University. Ms. Carlson is a highly accomplished and award-winning Government IT executive, and was named as one of the 39 most important people in the cloud by Insider. The many awards acknowledging her contributions Table of Contents include: winning the Wash100 Award six times, being one of Washingtonian s Tech Titans, winning the Fed100 Eagle Award, being named one of the top 12 executives in Fast Company s most influential women in technology category, being inducted into The Washington Life Tech Hall of Fame by ACT-IAC, being acknowledged for her Distinguished Leadership by the Committee for Economic Development (CED), and being given the Lifetime Achievement Award by Northern Virginia Technology Council (NVTC). Ms. Carlson is currently on the board of directors of Commure, Inc. Ms. Carlson is the Vice Chair of the White House Historical Association (WHHA), is Secretary of the Economic Club of Washington, and sits on the boards of the Atlantic Council, 9-11 Pentagon Memorial Fund, the Greater Washington Board of Trade, the International Center for Missing and Exploited Children (ICMEC), and the National Security Institute (NSI) at George Mason University. Matthew McElroy, the Chief Financial Officer of KnightSwan, is an experienced M&A accounting and finance leader. We believe Mr. McElroy s previous experience in providing consulting and audit services to the Aerospace, Defense, and Government Services ( ADG ) industry qualifies him to lead KnightSwan s due diligence processes on potential target companies. Prior to joining KnightSwan, from September 2018 to August 2021, Mr. McElroy led rigorous buy-side and sell-side financial due diligence engagements at Pipaya Partners ( Pipaya ), a leading boutique M&A consulting firm that specializes in the ADG industry. In addition to providing financial due diligence services to corporate clients in the ADG industry, Mr. McElroy also acted in interim Chief Financial Officer roles, providing financial reporting and corporate accounting expertise and executive leadership. Prior to Pipaya, from September 2016 to September 2018, Mr. McElroy served in various roles, including as a Manager, in the Transaction Services Group at Grant Thornton, one of the world s largest independent audit, tax, and advisory firms. While at Grant Thornton, Mr. McElroy executed numerous buy-side, sell-side, and divestiture transactions for both private equity and corporate clients across the ADG, technology, healthcare, and manufacturing industries. Before joining the Transaction Services Group, Mr. McElroy was an Engagement Lead in the Audit practice at Grant Thornton, focusing on the ADG and technology sectors for both publicly-traded and privately-held companies. Mr. McElroy received a Bachelor of Science in Accounting and Economics & Finance from University of Hartford and graduated summa cum laude. Since January 2020, Mr. McElroy has been the Vice President of the Alumni Association and ex officio Board of Trustee Members for Camp Dudley. Our Board of Directors Anne K. Altman is an independent director nominee and a respected global business leader, having worked for IBM for over three decades addressing complex business challenges within the government and commercial industries. Ms. Altman re-established IBM as a major force in the U.S. Federal market. Ms. Altman also led the company s mainframe business, System Z, through one of the most significant product launches in the history of the industry. Ms. Altman is widely recognized for the development, growth, and mentoring of leaders both within IBM and the broader business community. Ms. Altman retired from IBM as General Manager, IBM U.S. Federal and Government Industries. In that role, Ms. Altman was responsible for IBM s multi-billion dollar business with federal government clients and related industries in the United States. Prior to that role, Ms. Altman served as General Manager, IBM Public Sector, and had global responsibilities for government, healthcare, life sciences, and education. In this capacity, Table of Contents Ms. Altman also led IBM s Smarter Cities initiative, helping organizations, states, and countries focus on transforming infrastructure, citizen-based services, healthcare, and education all directed at improving economic vitality. In 2017, Ms. Altman co-founded Everyone Matters, Inc. , an organization focused on the advancement of individuals and social causes. Ms. Altman also serves as an independent director on the boards of SPX FLOW, Inc. (NYSE: FLOW) since March 2015, Maximus Inc. (NYSE: MMS) since January 2017, TechFlow, Inc. since July 2016, Siemens Government Technologies, Inc. since February 2018, and Gunnison Consulting Group since September 2019. Across these boards, Ms. Altman serves as a member of Audit, Compensation, Nominating and Governance, and Information Technology committees. Ms. Altman also serves on the Board of the National Symphony Orchestra and the Dean s Council of George Mason University, School of Business. Ms. Altman is also a member of the National Association of Corporate Directors (NACD). Ms. Altman received a Bachelor of Science in Marketing from George Mason University. Dr. Merlynn Carson is an independent director nominee and the founder of Myriddian, LLC ( Myriddian ), a leading health IT consultancy serving both the government and private sectors. Dr. Carson has been CEO/President of Myriddian since 2012. Dr. Carson, a physician by training, has been a persistent innovator in healthcare through her integration of technology, data, and clinical medicine to help better understand our public health needs and improve overall outcomes for providers, payors, and patients. Under Dr. Carson s leadership, Myriddian has won numerous awards, including Inc. 5,000 Fastest-Growing Companies and the Moxie Award for boldness in innovation. Dr. Carson is actively involved in both political and philanthropic initiatives. Dr. Carson is currently an engaged member of the Congressional Club, an Advisory Board Member of Winning for Women, and a Board Director of the White House Historic Association. Dr. Carson received a Bachelor of Science in Biology from the University of Maryland and a Doctorate of Medicine from American University of Antigua Manipal School of Medicine. Dr. Carson s professional accolades have been recognized through numerous awards: Smart CEO Brava Award, which honors Female CEOs that are exemplary leaders of both their company and their community; the Maryland Tech Council s 2021 Industry Awards Celebration, which named Myriddian as a finalist in the Emerging Technology Company of the Year category; American Excellence in Consulting and Leadership; and the Baltimore Business Journal Rising Star, a joint award with the Living Classrooms Foundation recognizing outstanding young leaders for their achievements and philanthropic efforts. S. Leslie Ireland is an independent director nominee and the former Assistant Secretary of the Treasury for Intelligence and Analysis. Ms. Ireland joined the Treasury in 2010 after 25 years at the CIA, where she specialized in Iran and the Middle East. Ms. Ireland retired in November 2016 after more than 31 years in the IC. From 2008 to 2010, Ms. Ireland served as the daily intelligence briefer to President Obama and from 2005 to 2008, Ms. Ireland served as the principal advisor to the Director of National Intelligence on Iran and was responsible for overseeing the intelligence process on Iran for the entire U.S. Government. Since September 2017, Ms. Ireland has been on the board of directors of Citigroup Inc. (NYSE: C). Since October 2017, Ms. Ireland has been on the board of directors of The Stimson Center. Ms. Ireland has been a member of Chubb Insurance s Cyber Security Advisory Board since March 2021. She has also been a member of Cyber Risk Directors Network, Tapestry Networks since December 2019 and also a member of the Board of Advisors of Cyber Florida: The Florida Center for Cybersecurity since November 2020. Ms. Ireland has also been an advisor to the CEO/Founder of Enveil, Inc. since March 2019. She was also the chairperson of the Financial Threats Council, Intelligence and National Security Alliance from May 2017 to February 2017. Table of Contents Ms. Ireland received a Bachelor of Arts in Government from Franklin and Marshall College. She received a Master s Degree in Russian Studies from Georgetown University. Ms. Ireland is the recipient of the Alexander Hamilton Award, the highest award bestowed by the Secretary of the Treasury. Ms. Ireland is also the recipient of the Intelligence Community Seal Medallion, the National Intelligence Distinguished Service Medal (2008 and 2016), and the CIA Intelligence Commendation Medal. Dawn Meyerriecks is an independent director nominee and the former Deputy Director of CIA for Science and Technology at the CIA. From 2014 to 2021, Ms. Meyerriecks led a global team of government and contract engineers, scientists, and project managers, providing technical, programmatic, operational, and policy oversight to multi-billion dollar programs focusing on national security objectives. Prior to the CIA, Ms. Meyerriecks served as the Deputy Director of National Intelligence for Acquisition, Technology & Facilities, delivering complex technologies that underpinned national missions. Before that, Ms. Meyerriecks served as the Senior Vice President for Product Technology at AOL, where she was responsible for full lifecycle development and integration of all consumer-facing AOL products and services. Before joining AOL, Ms. Meyerriecks worked for nearly ten years at the Defense Information Systems Agency (DISA), where she was the Chief Technology Officer and Technical Director for the Joint Interoperability and Engineering Organization (JIEO). Ms. Meyerriecks received a Bachelor of Science in Electrical Engineering and Business Administration from Carnegie-Mellon University. Ms. Meyerriecks received a Master of Science in Computer Science from Loyola Marymount University. In addition to holding senior leadership positions in Government, Ms. Meyerricks has extensive board and advisory experience, having served on the STRATCOM C2 Advisory Group, the Defense Science Board, the NCTC Advisory Board, the National Academy of Sciences, the Unisys Federal Advisory Board, and the SunFed Advisory Board. Her professional accomplishments have been recognized through numerous awards including: Tech Titans 2019: Washington s Top Tech Leaders, the Government Computer News Department of Defense Person of the Year, the Presidential Distinguished Service Award, InfoWorld CTO of the Year, and she was featured in Fortune magazine as one of the top 100 intellectual leaders in the world. Laura Price is an independent director nominee and former partner at KPMG, where she served for over 25 years specializing in providing financial reporting and risk management services to clients in the federal government. From June 2000 to September 2021, Ms. Price served as an audit and advisory partner in KPMG s federal consulting practice, where she helped build the firm s federal advisory presence and led a variety of financial management and operational improvement engagements for numerous federal agencies in all sectors including the U.S. intelligence agencies, DoD components, legislative agencies and a number of federal civilian agencies. Prior to becoming a partner at KPMG, Ms. Price was an audit senior manager and audit manager at KPMG. While at KPMG, Ms. Price authored multiple publications on a litany of topics ranging from human capital risk to managing cultural assets. From 2008 until November 2021, Ms. Price served as treasurer of the board of the DC Youth Orchestra Program, which provides music education to youth from all socioeconomic backgrounds. In addition, Ms. Price is a member of several professional organizations, including the American Institute of Certified Public Accountants and the National Association of Government Accountants. Ms. Price received a Bachelor of Science in Business Administration with a concentration in accounting from Michigan Technical University and received a Master of Arts in organization management from George Washington University. Our Business Strategy and Market Opportunity KnightSwan will identify technologically-differentiated and innovative technology companies that it believes will address needs of government and commercial areas such as cyber, cloud, and mission intelligence, Table of Contents and accelerate the transformation of federal technology by providing funding and strategic and operational enhancements to those companies. We are targeting companies in the most innovative sectors of government and commercial-end markets with compelling sources of alpha generation in three key sectors: Cloud: The shift of infrastructure and software to the cloud has enabled more rapid computing, processing, analytics, and computational efficacy. While legacy systems providers remain tethered to on-site processing resources and local insights, the opportunity of cloud enables exponential expansion of inputs and delivered outputs. Our substantial experience leading and scaling large cloud providers has shown us how transformational and expansive cloud technology can be. Management believes that near-limitless computation enables unforeseen innovation and enables significant upside opportunity for best-in-class technology product providers to excel. All of this opportunity is supported by significant cloud spending growth, which globally in 2022 is expected to grow 47% over 2020, from $270 billion to $397 billion; which suggests a CAGR of 21.3%. Source: Gartner (April 2021). Cyber: Due to the combination of increasingly complex IT estates, growing attack surfaces, the scarcity of IT security professionals, and the proliferation of highly motivated, sophisticated, and aggressive cyber criminals, the already robust market for cybersecurity solutions has only grown since the start of the COVID-19 pandemic and spans both commercial and government sectors. The opportunity to leverage cross-sector commercial capabilities to drive government technology expansion remains a differentiating capability; which we believe we can take advantage of due to the KnightSwan team s significant experiential diversity. Addressable market within cyber remains favorable as the global cybersecurity market is projected to grow nearly 60% from $173 billion in 2020 to $270 billion in 2026; this suggests a 7.7% CAGR supporting strong growth and demand within the sector. We believe truly comprehensive cyber focus remains a nascent opportunity within most organizations and presents an immense opportunity for new products to disrupt the market. Table of Contents Source: Australian Cyber Security Growth Network. Mission Intelligence: As the global threat level sustains and near-peer adversaries (Russia, China) threaten the United States and its allies, mission intelligence and derived insights are an essential requirement. The ability to ingest, interpret, and analyze critical signals and insights remains not only a competitive advantage while on the military battlefield, but also commercially, as it relates to the success of allied economies and maintaining proprietary domestic technologies across civil agencies, as well. Federal agency spending is projected to be 39% of the United States Gross Domestic Product ( GDP ) for a total estimated spending opportunity across military and civil government agencies of $9.0 trillion for 2021. KnightSwan s focus across both landscapes enables a broader addressable market and opportunity set for acquisitions. Most SPAC opportunities are focused on either military or civil agencies, but KnightSwan leadership has extensive experience across the entire landscape of the federal government opportunity. Within this substantial spending opportunity, the total DoD opportunity is immense, representing an addressable market of over $700 billion of spending in recent years as these elevated spending levels have endured with strong bipartisan support. KnightSwan has specific expertise within the DoD and has the ability to tap into this military-focused spending. On a more narrow view, the combined addressable market for the IC and DoD IT spending accounts for nearly $125 billion in GFY 2022. Both markets have both shown a consistent CAGR of 3.5%+ annually. These dollars are significant, and within the intelligence community specifically, only begin to scratch the surface of the true funding amount; privately, the budget is known to be significantly larger as many dark and counter-intelligence programs are not included in this figure. This demand for constant intelligence gathering and analysis is only exacerbated by the continued threat of allied enemies continuing to push the technology envelope, which drives the need for constant innovation. Near-peer allies have shown an increasing ability to outpace the U.S. on a variety of technological fronts, specifically in the cyber domain. The battleground is changing, with a renewed focus on technology driving the mission over local intelligence gathering and support. Management believes that this trend has only been exacerbated by the limited local presence afforded the U.S. and its allies within Russia and China; this is a stark difference to prior engagements where boots-on-the-ground provided a local veil of filtering for intelligence interpretation. We believe this shift in war-focus drives an enhanced need for new mission intelligence products, as software and code alone cannot guarantee security given the ever-changing hacker environment. Though difficult to quantify given the clandestine nature of this work, this opportunity significantly outpaces the broader topline growth rate. Table of Contents As these trends relate to cyber and IT spending going forward, this path has been firmly laid out through stated DoD cyber and modernization strategies, which represent the DoD s vision for addressing threats and implementing the priorities of the National Security Strategy across all warfighting domains. These cyberspace objectives are broad reaching, and have impact well beyond the military for instance, these dollars are supporting critical U.S. infrastructure domestically, as well as the broader DoD network and cyber domain. Modernization is at the forefront of driving this IT growth as legacy systems continue to operate pervasively within the DoD. Years of spending cutbacks through prior sequestration has led to the immediate need to upgrade and secure national security systems at an unprecedented level; no longer can the U.S. government delay spending while near-peer allies have the advantage of starting their ascent from a modern launching point. As such, these efforts continue to see bipartisan support and are expected to significantly support the next layer of defense and mission intelligence products providers. Source: Federal Reserve U.S. Department of Defense Budget Over Time ($, billions) Source: Office of the Comptroller of the U.S. Department of Defense. Table of Contents U.S. Intelligence Community Budget Over Time ($, billions) Source: Office of the Director of National Intelligence. Department of Defense - Total IT Spending Over Time ($, billions) Source: Federal IT Dashboard Department of Defense Agency. Acquisition Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. We intend to acquire one or more businesses that: Operate in attractive and growing subsectors within cloud, cyber, and mission intelligence Are mission-driven Benefit from strategic/operational enhancements Have products/solutions that are technologically differentiated and create significant value for customers Have scalable business models with visible monetization solutions Have experienced management teams with demonstrated customer success Are poised for penetration into either government and/or commercial customer markets Table of Contents These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as on other considerations, factors, and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our stockholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC. Our Acquisition Process In evaluating a prospective target business, we expect to conduct a thorough due diligence review that will encompass, among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities where applicable, as well as a review of financial, operational, legal and other information that will be made available to us. We will also utilize our operational and capital planning experience. The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of, and negotiation with, a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the funds we can use to complete another business combination. We are not prohibited from pursuing an initial business combination or subsequent transaction with a company that is affiliated with our sponsor or any member of the KnightSwan team. Our President and Chief Executive Officer, Brandee Daly, and the Chair of our board of directors, Teresa Carlson, are currently restricted by non-compete and non-solicitation provisions contained in certain employment and other agreements, which provisions are expected to be in effect for at least part of the time following the consummation of this offering. See
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+This summary highlights information contained elsewhere in this prospectus. This summary may not contain all the information that may be important to you in making your investment decision, and we urge you to read this entire prospectus carefully, including the Risk Factors, Business, Management s Discussion and Analysis of Financial Condition and Results of Operations and Unaudited Pro Forma Condensed Consolidated Financial Information sections and our consolidated financial statements and notes to those statements, included elsewhere in this prospectus, before deciding to invest in our Class A common shares. Our mission Our mission is to power the digital ecosystem in emerging countries to unlock and drive economic growth. Overview Aleph is a leading global enabler of digital advertising connecting thousands of advertisers in emerging countries with the world s leading digital platforms. Aleph represents some of the world s leading platforms in over 90 markets across the globe where they do not have a physical presence, enabling platforms like TikTok, Spotify, Meta, Snapchat, Twitter, Google, Reddit, Twitch, and nearly 30 others to expand into new markets while enabling advertisers to take full advantage of the platform s advertising capabilities. Through these long-lasting commercial and, in many cases, exclusive partnerships, Aleph provides digital platforms with a sustainable and scalable way to monetize their advertising inventory in emerging countries at little additional cost and complexity. We combine these relationships with our extensive global footprint and an end-to-end digital advertising solution that enables advertisers in emerging and digitally developing countries to reach over three billion consumers expanding opportunities for businesses to advertise at a local and global level. The digital advertising ecosystem is growing rapidly across the world, particularly in emerging countries, as demographic and economic growth is compounded by growing digital penetration and digital advertising knowledge in these regions. Despite this growth, the global digital advertising ecosystem remains disproportionately distributed and unequally accessible: there are only 23 developed countries, populated by only 1 billion people (13% of the world s population) and yet these countries represent 64% of the global digital ad spend. Beyond the developed world, there are 170 emerging countries, made up of 6.7 billion people, which currently represent only 36% of the global ad spend. Additionally, the GDP per capita in developed countries is an average of U.S.$55,000 versus U.S.$6,000 in emerging countries. TABLE OF CONTENTS The world s leading digital media platforms and advertisers of all sizes across the world have struggled to take full advantage of this substantial opportunity in emerging countries. For digital platforms, opening in-house operations in emerging countries requires substantial time and resources, both financially and operationally, that may be better utilized in developed countries. Advertisers in emerging countries, who increasingly seek new ways to reach consumers locally and across the world, often lack access to and expertise in digital platforms, which limits their digital advertising potential and ability to grow their businesses. As a result, digital platforms often under-monetize their audiences and millions of advertisers lack access to both local and global consumers available on these platforms, which has further widened the gap. Aleph has built a global infrastructure that aggregates the growth opportunity created when thousands of local marketers gain access to the world s leading digital platforms. Our infrastructure aims to democratize access to and equalize the global digital media ecosystem. We offer an unparalleled end-to-end business solution for both our platforms and advertisers. Our solution spans the spectrum of digital advertising, from sales and product expertise and deeply embedded local market knowledge, to proprietary technology and local and cross-border credit and payments. As an extension of our partners, our value proposition to platforms is simple: quickly and efficiently enhance the monetization of their platform while avoiding the complexity and significant investment required to enter a new market. We provide each of our partners with dedicated, local teams that handle their sales, marketing, customer education, platform onboarding and operations in each of the countries in which we represent them. When representing a platform, we are generally the only third-party authorized to monetize their inventory in specific markets. Typically, advertisers in emerging countries have limited access to large digital platforms and lack local support because the platforms often focus their attention on monetizing in developed countries. As an extension of our partners, and as a result of hiring local, dedicated teams, we have also built an integral financial infrastructure that allows us to handle most financial aspects for our partners and advertisers, including credit analysis, billing, collections, foreign exchanges, local and withholding taxes and payment options. Our scalable business model allows us to take advantage of a virtuous cycle in which every new partner, country and advertiser that we add to our portfolio creates value for all stakeholders, thereby powering the global digital ecosystem. We believe the growth in global digital advertising is a significant accelerator for our business and that we are uniquely primed to take advantage of this momentum. Economic development, mobile broadband rollouts and TABLE OF CONTENTS fast-paced digital adoption have spurred an ongoing growth in internet and smartphone penetration in emerging countries. Additionally, in response to the increasing number of consumers shifting to online platforms, global digital advertising has grown nearly thirteen times the growth of global GDP, growing approximately 21.8% CAGR over the last four years, from U.S.$236.8 billion in 2017 to U.S.$521.0 billion in 2021 according to eMarketer. This has contributed to significant growth in digital advertising spending across the world. According to eMarketer, global digital advertising spending represented 41.3% of the total advertising spending in 2017 and is expected to reach 66.4% in 2022, compared to traditional advertising, which in 2017 represented 58.7% of total advertising spending and is expected to decline to 33.6% in 2022. We estimate our TAM in 2022 to be 18% of the global digital advertising spending or U.S.$107.3 billion. The total advertising spending in countries that we consider to be part of our TAM is expected to grow at 14.0% CAGR to U.S.$159 billion in 2025. We envision this growth dynamic will encourage additional leading digital platforms to grow and monetize their user base in emerging countries through us. Considering our scalable business model, position at the core of the digital advertising ecosystem and our extensive geographic coverage we believe we are well positioned to be their first call. We believe we have several competitive advantages that have allowed us to achieve and maintain our market leadership. Our tenure, track record and extensive global footprint allow us to harness superior industry knowledge and serve as a crucial link at the center of the digital advertising ecosystem between digital platforms, advertisers and consumers. Currently, we believe that there may not be any other company with a global footprint across 93 countries and representing 37 platforms. We have a founder-led, global management team with deep expertise in the digital domain and are supported by world-class investors who share our vision, including CVC, Twitter, Snap and MercadoLibre, among others. We believe our independent, neutral position within the industry gives us an unparalleled competitive advantage to connect leading digital platform partners to local, regional and global advertisers while creating a strong barrier to entry for any potential competitors. Since our inception, we have demonstrated the strategic value of our solutions and the ability to expand our coverage in emerging countries and add new partners and advertisers. As of December 31, 2018, we represented 12 partners in 36 countries resulting in 147 total representations. By August 31, 2022, that amount increased by 219% to 469 representations for 37 partners across 93 countries. Based on our analysis of information from eMarketer, our Total Advertising Volume grew approximately ten times faster than the broader digital advertising industry in emerging countries in 2020, and grew approximately seven times faster than the broader digital advertising industry in 2021. TABLE OF CONTENTS The value we provide to advertisers through our expert local support and end-to-end digital advertising solutions is demonstrated by the growth in our total number of advertisers of 43.6% between December 31, 2019 and December 31, 2020 and 80.4% between December 31, 2020 and December 31, 2021, while achieving a Total Advertising Volume Retention Rate of 165.3% for the year ended December 31, 2021, excluding recurring and new clients from Ad Dynamo, a South Africa company we acquired on November 30, 2021. For the six-month period ended June 30, 2022, our Total Advertising Volume Retention Rate was 146.2%. We have identified several attractive growth opportunities that we are well-positioned to execute on as digital penetration continues to expand rapidly across the world. Our five pillars of growth are to: 1. Grow revenue of current partners and advertisers in current countries. 2. Expand coverage of current partners and advertisers into new countries. 3. Add new partners and new advertisers. 4. Deploy a global solution for small and medium sized businesses to advertise on leading digital platforms. 5. Enlarge our footprint to new emerging regions organically and through M&A and potentially acquire companies with proprietary technology that may complement our business. We believe that our success is reflected by our rapid growth, profitability and strong cash flow generation. On a foreign exchange (FX) neutral basis, during the first six months of 2022 our Total Advertising Volume grew 73.2% and our revenues, net, grew 96.5%, in each case compared to the first six months of 2021, while operating in 93 countries (predominantly emerging markets) and with capability to receive and process payments in 49 currencies. See Presentation of Financial and Other Information Special Note regarding Foreign Exchange ( FX ) neutral measures for an explanation of our foreign exchange (FX) neutral measures. Our net revenue was U.S.$99.3 million in the six-month period ended June 30, 2022, representing a growth rate of 72.9% over U.S.$57.4 million in the same period in 2021 and U.S.$131.1 million in the year ended December 31, 2021, representing a growth rate of 86.6% over U.S.$70.3 million in 2020. We believe that we have achieved significant scale with U.S.$680.1 million in Total Advertising Volume in the six-month period ended June 30, 2022, representing 55.8% growth compared to a Total Advertising Volume of U.S.$436.5 million in the same period in 2021, and U.S.$971.8 million in Total Advertising Volume in the year ended December 31, 2021, representing a growth of 124.6%, compared to a Total Advertising Volume of U.S.$432.7 million in 2020. We generated an Adjusted EBITDA of U.S.$37.7 million in the six-month period ended June 30, 2022, representing a growth rate of 55.0% over U.S.$24.3 million in the same period in 2021, and U.S.$48.8 million in the year ended December 31, 2021, representing a growth rate of 143.6% over U.S.$20.0 million in 2020. History and development In January 2005, our Chief Executive Officer, Mr. Gaston Taratuta, founded IMS Internet Media Services, Inc. with the goal of unlocking the opportunities provided by digital media. Prior to this, Mr. Taratuta was the Head of International Revenue for UOL (Universal Online), one of the largest online media portals in Latin America. Mr. Taratuta started offering U.S. companies the opportunity to reach millions of Latin American consumers through UOL s portal and quickly realized that there was an opportunity to reach global audiences beyond UOL. In 2010, Mr. Taratuta invited Mr. Ignacio Vidaguren, our current global Chief Operating Officer, to join IMS as a partner. Ignacio had prior experience leading one of Latin America s largest digital properties, MercadoLibre, as SVP of Marketing, Sales and Business Development through their initial public offering, and at McKinsey & Co. Connecting global advertisers with international consumers requires time, effort and education. We understand that knowledge about the digital media industry is often not distributed equally around the world. Since our inception, we have been educating marketers on how to take advantage of the opportunities presented by digital media. This commitment to education led us to partner with the Stanford Graduate School of Business to create a tailored program for regional industry leads, providing them with the opportunity to participate in a TABLE OF CONTENTS week-long immersive Executive Education Program where they receive first-class content from Stanford University professors and industry leaders. Over the last several years, we have organized seven Executive Education Programs. In 2012, we entered into a commercial agreement to be the sole representative of Twitter in Latin America. This became a pivotal moment for the company as it was the first of our over 25 commercial agreements with leading digital platforms. We believe we pioneered the concept of establishing fully dedicated teams for each representation, which allowed us to easily grow our partner base at a rapid pace. During the following few years, we expanded geographically opening offices in additional countries and entering new representation agreements with major digital platforms, including Microsoft, Snapchat, Waze, Twitch, Spotify, Verizon Media, Foursquare, Electronic Arts, Apple iAds and others. In 2014, we acquired Social Snack, a digital content and creative company that provides in-house localization services with the objective of adding value to the leading digital platforms at the intersection between technology and content. In 2015, Sony Pictures Television, a Sony Pictures Entertainment company, acquired 51% of IMS. At that time, Sony s intention was to add to their portfolio a global digital advertising offering. In 2020, we repurchased a portion of our stock from Sony, after which they held approximately 10%. In 2017, we significantly expanded our geographic reach by acquiring a 51% stake in Httpool, a U.K. based company with similar representation arrangements in several countries throughout Europe and Asia Pacific, and increased our ownership to 75.5% in 2020. At the time of the acquisition, we were able to expand our presence into 17 new countries. Since then, our operations in Europe and Asia Pacific have grown considerably. In service to our Twitter and Facebook advertisers, we created Wise.Blue and SMB Express, technology solutions focused on optimizing digital campaigns on Twitter and Facebook, respectively. Through the addition of Httpool, we added a group of talented executives with an entrepreneurial spirit led by Httpool s founder and chief executive officer, Aljo a Jenko, who currently serves as Aleph s Global Chief Strategy Officer. Since our acquisition of Httpool, we have continued to bring on additional partners, including Meta and Warner Music Group in 2018 and TikTok and Activision Blizzard Media in 2019. For the year ended 2021, we operated in 90 countries, represented 31 partners and worked with 15,565 advertisers. During the six-month period ended June 30, 2022 we worked with over 12,900 advertisers, which does not account for year-end ad campaigns. In July 2021, we formed Aleph Group, Inc, which, among other things, consolidates our digital media service businesses including Httpool, IMS, Ad Dynamo, Connect Ads, Wise.Blue and Social Snack. We currently benefit from the support and experience of investors such as CVC Capital Partners, Sony Pictures Entertainment, MercadoLibre, Twitter and Snap, among others. See Business Recent Developments. Since our inception, we have developed a strong track record of expanding our geographic coverage as well as securing a significant number of global digital platform partners and advertisers. With the commitment of our investors, members of our board of directors, management and employees, we intend to continue growing our current business, expanding our geographic footprint, adding new commercial agreements and advertisers and integrating new technology solutions. Our industry The digital advertising ecosystem The advertising industry has continued its transformation, evolving from traditional channels such as radio, print media, television and out-of-home advertising to dynamic digital advertising media such as web browsers, social media, mobile applications and gaming platforms. Within the digital advertising landscape, there are typically two types of offerings: the open web and the closed web (or walled gardens offering). The open internet is a collection of open technologies that enable access to all public content that is viewable to everyone with no restrictions. The media opportunities that exist on the open web are standard media placements that are not specific to each environment. Alternatively, the closed web TABLE OF CONTENTS environment, also referred to as the walled gardens, refers to closed technologies, primarily in-app environments, where users are restricted to certain content that is only available to users of that technology. The media opportunities are native and unique to each technology, which requires a tailored and customized digital ad experience. We operate in the closed web environment, which we believe has more and better targeting capabilities within each walled garden. Each of our partner s platforms offer premium, native inventory as unique as the user experiences, a differentiated consumer journey, with a tailored and customized approach to advertising. By contrast, we believe that digital advertising delivered through open web sources is fragmented, confusing and a less effective use of an advertiser s budget. According to eMarketer, global digital advertising spending represented 41.3% of the total advertising spending in 2017 and is expected to reach 66.4% in 2022, compared to traditional advertising, which in 2017 represented 58.7% of total advertising spending and is expected to decline to 33.6% in 2022. The proliferation of households with internet and smartphone access across the world has shifted consumers attention towards these modern digital advertising channels. As a result, today s consumer has a variety of options to consume digital content, which has created an attractive opportunity for advertisers to reach new audiences through these new, dynamic digital platforms, each with its unique advertising formats and functionality. This trend has been further accelerated by the COVID-19 pandemic. Amidst the rapid growth of internet and mobile-based solutions, the user bases of digital platforms have increased significantly as well with the emergence of new advertisers such as e-commerce companies. We believe that this has created a substantial growth in unmonetized advertising inventory, especially in emerging countries. More broadly, as of October 2020, the global digital economy is equivalent to 15.5% of global GDP, growing approximately 2.5 times faster than global GDP over the past 15 years, according to the World Bank. Challenges for partners For partners, opening in-house operations in growing emerging countries requires substantial time and resources, both financially and operationally, that are often more efficiently used in developed geographies. All leading digital platforms have global audiences, with users present in almost every country around the world. However, when it comes to monetizing these global audiences through digital advertising, these leading digital platforms have offices primarily in developed countries, leaving all the other countries and their advertisers with little to no support. Therefore, we believe that they greatly under-monetize the audiences and underserve the advertisers in these countries. Challenges vary depending on the partner and the specific geography, but generally involve the following: Significant time and resources to enter new and emerging countries. Entering new geographies requires a deep understanding of legal and financial implications of doing business in a specific region, such as regulatory codes, compliance procedures and local business customs. Lack of local relationships with key digital players. Launching operations in emerging countries requires building and nurturing a broad and deep network of relationships with key advertisers, agencies and content providers in each country. Limited monetization through self-service. The vast majority of advertisers lack knowledge on how to effectively engage customers through the constantly evolving unique features and formats of each platform, which makes it difficult to understand the efficacy of a test campaign through a self-service platform. Advertisers may also have difficulty with the particulars of working with a self-service platform. For example, advertisers often need to transact on self-service platforms by setting up a budget with a credit card. This may be a viable option for a small, local advertiser but not for a major brand that requires credit, payment terms and proper invoicing in local currency. Furthermore, despite the fact that self-service platforms serve as a good way to test the digital advertising options, without local expert advice and guidance, the advertisers are left on their own to determine optimal budgets and platforms, which can lead to them not maximizing their advertisers budgets. TABLE OF CONTENTS Complexity of cross-border financial operations, credits and payments. Each country has its own local laws, taxes and other regulations that are better managed by a dedicated business operations team functioning with local knowledge. Further, emerging countries are often not well known for ease of doing business. Challenges for advertisers Given recent global digitalization trends, we believe that advertisers in emerging countries are increasingly seeking new ways to reach consumers locally and across the world in order to grow their businesses and address changing consumer preferences. However, advertisers in these markets face several challenges that limit their digital advertising potential: Limited access to leading global digital platforms. The majority of our partners tend to focus on developed countries and avoid deploying local operations in new and emerging geographies. In these underserved emerging countries, in our experience, some digital platforms offer only limited methods of contact and customer support, which prevents both local and multinational advertisers from gaining access to new digital platforms and forces them to navigate digital platforms on their own. Lack of local platform experts. Leveraging digital platforms requires advertisers to understand and keep pace with new and constantly evolving features, functionality and formats unique to each digital platform. Since most platforms do not have specialized sales teams in most markets, advertisers in those markets are left without the knowledge of how to advertise efficiently on the platforms. Lack of technology solutions. Advertisers from underserved markets often lack access to and know-how of technology solutions. As a result, they are unable to maximize their digital investments. They typically require comprehensive, localized technology solutions that provide functionality with support in local language, the ability to transact in local currencies and enhanced features to efficiently achieve their desired results. Lack of credit, terms and local billing. Based on our experience, many of the digital platforms do not provide flexible payment terms, including options for payments in local currency, localized advertising rates and multiple methods for payment, which poses a challenge particularly for smaller advertisers with limited capital resources who may need access to credit and longer payment terms. Key industry trends in our favor Approximately 84% of the 93 countries in which we operate as of June 30, 2022 are considered emerging economies and fueling growth in these markets is the cornerstone of our strategy. From 2017 to 2021, emerging countries have experienced a higher GDP growth than developed countries: 2.8% growth in emerging countries compared to 0.9% in developed countries according to the EIU. Additionally, according to the same studies, emerging countries in the aggregate are expected to continue this trend and outpace the GDP growth of developed countries through 2025 and likely beyond. Additionally, according to our calculations and based on data provided by eMarketer, digital advertising spending in 2021 represents only 5.0% of real GDP of emerging countries, unlike more developed countries where it represents 6.9% of real GDP. We believe that the higher portion of digital advertising spending and economic opportunity in developed countries has led most digital platforms to historically focus on monetization in developed countries, relying on companies like Aleph to help them monetize in non-core markets. Demographic and economic growth is compounded by growing digital penetration and digital advertising knowledge in emerging countries. There are several key trends that influence the digital advertising ecosystem, including: Connectivity and digital penetration in emerging countries continue to grow Economic development, mobile broadband rollouts and fast-paced digital adoption have enabled an ongoing growth in internet and smartphone penetration in emerging countries. More specifically, in terms of social media, emerging countries tend to have a higher usage compared to developed countries. According to GWI, in developed countries such as Japan, the United Kingdom and the United TABLE OF CONTENTS States, the average time spent per user on social media in an average day ranges from 48 minutes to 2 hours and 8 minutes compared to emerging countries such as Argentina, Indonesia and Ghana where they all surpass 3 hours and 19 minutes. Still underpenetrated internet and smartphone markets combined with the high social media platform usage in these emerging countries are expected to boost the digital advertising inventory and provide a myriad of opportunities for players in the digital advertising ecosystem. Digital advertising spending is growing rapidly across the world Over the last decade, digital adoption has revolutionized the way we interact with one another and consume information, entertainment, goods and services. In response to the increasing number of consumers shifting to online platforms, global digital advertising has grown nearly thirteen times faster than global GDP at approximately 21.8% CAGR over the last four years, from U.S.$236.8 billion in 2017 to U.S.$521.0 billion in 2021 according to eMarketer. The growth of digital advertising spending in emerging countries, with 24.3% growth in the last four years, has outpaced that of developed countries, with 20.5% growth over the same period, and is expected to continue the same trend through 2025 according to eMarketer. Digital platforms struggle to monetize rapidly growing active user bases in emerging countries Advertisers are increasingly seeking to reach and meaningfully engage target customers across a wider variety of digital channels, social networks and geographies. According to Global Data, while social media penetration reached 67.1% in developed countries in 2021, emerging countries only achieved 48.2% in the same year. According to Frost & Sullivan, in 2019, the combined social networking user base in emerging countries reached approximately 1.6 billion, which is about 60% larger than the user base in the United States and Western Europe combined. Thus, emerging countries represent a significant opportunity for digital platforms to grow users, which would also present considerable advertising inventory for businesses across the world. As a result, platforms often develop their own self-service monetization tools so local advertisers can activate campaigns, but due to the limitations of these platforms, we believe they are unable to fully capitalize on the revenue opportunity from advertisers in underserved countries. SMBs are increasingly relying on digital advertising In response to increasing internet usage of today s consumer across the world, small and mid-size advertisers have started to rely more heavily on digital advertising to connect with customers and grow their businesses. SMBs, often with fewer technical and operational resources compared to larger enterprises, can leverage digital advertising to deploy creative marketing campaigns capable of reaching larger audiences in a more cost-efficient manner than traditional advertising. Growing number of technology start-ups in new verticals such as e-commerce and fintech Rising internet usage, mobile penetration and availability of venture capital funding has been fueling the formation of technology businesses over the last few years. This increase in venture capital funding has greatly accelerated the amount these start-ups are investing in their marketing efforts. This trend is increasingly apparent for internet retail companies. Additionally, leading digital platforms have recently launched new e-commerce capabilities and advertising tools to encourage businesses to move their customer journey to take place entirely within their digital platforms. We believe that the rapid development of digital advertising has disrupted the advertising agencies. We expect that in-house digital advertising teams and independent digital advertising companies will become more relevant players in the advertising industry. Our market opportunity Digital advertising spending is expanding rapidly across the world. According to eMarketer, global digital advertising spending is expected to reach U.S.$602 billion in 2022. We estimate our TAM for 2022 to be 18% of TABLE OF CONTENTS the global digital advertising spending, or U.S.$107 billion. The total advertising spending in countries that we consider to be part of our TAM is expected to grow at a 14.0% CAGR to U.S.$159 billion in 2025, as estimated by eMarketer. We believe that there are several factors that will expand our market opportunity, including the continued growth of digital penetration in emerging countries. The countries where we currently operate account for 72% of the global population with around 5.6 billion people and are expected to generate 38% of the global GDP in 2022 according to the EIU. Additionally, according to our calculations and based on data provided by eMarketer, digital advertising spending in 2021 represents only 5.0% of real GDP of emerging countries, unlike more developed countries where it represents 6.9% of real GDP. We expect our estimated market opportunity will continue to expand as connectivity and digital penetration rise in emerging countries, digital platforms continue to proliferate, consumer preferences shift towards online channels and smaller businesses continue to embrace digital advertising across the world. What we do As a trusted partner to the entire digital advertising community, we connect the largest players in the digital ecosystem with advertisers across the world, helping them reach billions of digital consumers in emerging and underserved countries. TABLE OF CONTENTS We deliver an end-to-end digital solution to our advertisers, agencies and digital platforms in the following ways: Long-standing partner representations: Serving as the critical link between digital platforms and advertisers. We have long-standing partnerships with the leading digital platforms and in many cases serve as their exclusive or sole representative in a number of emerging countries. This allows partners to access a significant, untapped revenue opportunity to monetize premium, walled-garden advertising inventory by connecting them with advertisers and agencies whether they are looking to reach local, regional or global audiences. Our ability to quickly scale and grow our partners revenues has further secured their trust in us to expand their business into new markets over time. The following graph shows the growth in the number of countries in which we represented our top partners, both during the year in which we were first engaged and as of June 30, 2022. Market education: Provide local market educational content, training and proprietary technology. We offer comprehensive marketing education solutions, from training workshops to public relations, newsletters and marketing events across local markets. We also developed a proprietary technology, Digital Ad Expert, where professionals can be certified on the leading digital platforms and have access to industry insights. Local platform dedicated sales: Hire and train local platform-dedicated teams for partners, advertisers and agencies. Our organization is composed of both local and platform-dedicated sales and operational teams that provide extensive industry and cultural knowledge and platform expertise to advertisers and agencies so they can create and optimize impactful, localized digital campaigns. For example, as of June 30, 2022, we have 172 team members dedicated to Twitter, 118 to Meta, 70 to TikTok, 63 to Snapchat, 45 to Spotify and 21 to Microsoft. TABLE OF CONTENTS Campaign management and optimization: Focus on providing white-glove service to exceed campaign goals. Our presence in 93 countries allows us to uncover meaningful insights unique to each of our partners. Our dedicated local teams deliver a tailor-made blend of media planning, audience strategy and insights on how to best use or adapt creative assets and optimize campaigns to ensure advertisers campaigns run successfully on our partners digital platforms. Technology solutions: Combining insights from local client success managers and proprietary technology to reach campaign goals. In the spirit of partnership, we have developed differentiated technology solutions for advertisers and agencies to maximize the effectiveness of their digital campaigns on major platforms, such as Twitter and Facebook. Cross-border credit and payments. With presence in 93 countries, we have built a robust, global payments infrastructure capable of providing credit analysis and simplifying complex payments between advertisers and partners across multiple countries with varying currencies, regulations and tax considerations. Additionally, our extensive, global presence allows us to efficiently share HR, marketing and IT resources and verticalized platform specialists, which we leverage to quickly launch and reach scale in new countries. The following graph illustrates what we do on behalf of our partners by consolidating a number of invoices from several advertisers in different countries and currencies into one single cross-border payment. Key benefits to partners We partner with the leading digital platforms in 93 developed and emerging countries across the globe. We act as an extension to our partners organization. We believe the benefits to our partners of working with us include, but are not limited to: TABLE OF CONTENTS Quickly and efficiently establishing local teams and operations. We deploy local and platform-dedicated teams for each of our partners made up of seasoned professionals with strong relationships with advertisers and agencies in each market. We enable more rapid, streamlined expansion of our partners digital platforms in emerging countries at a larger scale with lower costs and operational complexity that often only requires one person from our partner s organization to manage. We believe that this flywheel effect increases the probability of success due to the synergies created by our existing presence in 93 countries. Boost platform usage through dedicated marketing, education and localized content creation. As an extension of our partners, our exclusive platform-dedicated teams understand the unique cultures in which they operate and become experts in each digital platform s capabilities, features and user base. These teams educate advertisers and agencies on each of our partners platforms, empowering them to take advantage of the opportunity to reach new customers in their local region through digital platforms they had not previously been able to access. Our local presence allows us to develop strong relationships with local content creators, which are instrumental to increase user traffic into our partners platforms in each particular geography. Simple and reliable payment operations. We have built a global payments infrastructure capable of facilitating credit and payments between advertisers and partners across various countries and in different and often fluctuating currencies. Instead of our partners transacting directly with individual advertisers, we act as a single large-scale counterpart for our partners and manage local billing processes according to each country s business customs and currency. This simplifies the administration, foreign currency exchange management and payment processes for our partners, while reducing their credit and operational risk with multiple individual advertisers and facilitating the efficiency of payments. Grow advertising revenue by expanding into new markets and customer segments. We provide our partners with a sustainable and scalable business model that allows them to focus on their core, developed countries and generate incremental advertising revenue at little additional cost. For the six-month period ended June 30, 2022, we generated U.S.$680.1 million of Total Advertising Volume from our advertisers, representing 55.8% growth compared to a Total Advertising Volume of U.S.$436.5 million in the same period in 2021. For the year ended December 31, 2021, we generated U.S.$971.8 million of Total Advertising Volume from our advertisers, representing a growth of 124.6%, compared to a Total Advertising Volume of U.S.$432.7 million in the same period in 2020. As of December 31, 2018, we represented 12 partners in 36 countries resulting in 147 total representations. As of the date of this prospectus, that amount increased by 219% to 469 representations for 37 partners in 93 countries. TABLE OF CONTENTS Key benefits to advertisers During the six-month period ended June 30, 2022 we helped over 12,900 advertisers in 93 countries maximize the value of their digital advertising through a complete service ecosystem consisting of digital expertise, deeply embedded local market knowledge and innovative proprietary technology. Our solutions provide advertisers with several benefits at no additional cost for our services, including: Market outreach, education & certification: Continuing education of in-house digital advertisers. We leverage a unique combination of deep knowledge of local cultures and digital platform expertise to offer the digital advertising community a wide range of impactful education solutions, such as digital advertising training workshops, industry and local country research, partner specific platform training and online certification programs through our proprietary education platform Digital Ad Expert.These programs equip digital marketing professionals with the tools they need to make informed decisions on which digital platforms to activate and enhance the digital marketing capabilities of their business. Sales strategy and planning: Access to a wide range of leading global digital platforms. Our strong relationships with most of the largest digital platforms in the world offers global, regional and local advertisers the ability to reach billions of consumers in 93 countries. Within each country, our local knowledge and relationships allow advertisers and agencies that work with them to tap into local communities across our partners platforms and deliver more meaningful and relevant content to target audiences. Additionally, our global footprint and network enables advertisers in emerging countries with strong e-commerce distribution to reach consumers beyond their national borders in developed countries like the United States. Dedicated client services: End-to-end, turn-key digital advertising at both a local and global level. Our full-service ecosystem provides end-to-end support for all the stages of a digital ad campaign. Given our deep cultural knowledge of local consumer behavior, we empower advertisers and agencies to create localized ad content for different stages of the advertising funnel, tailor ad formats for optimal consumption and deliver the right ads to the right people at the right time. Flexible credit and local billing and collections. Flexibility in invoicing in local currency and offering multiple payment methods. We provide advertisers with flexible trade credit terms based on the regional requirements and specific needs of each advertiser, including the flexibility of paying in local currency that often absorbs the risk of frequently fluctuating exchange rates. As of June 30, 2022, we have the capability to receive and process payments in 49 currencies, which we then convert into single payments for each of our partners. This payment flexibility and support allows advertisers to activate and deploy digital campaigns in ways they would not be able to access by themselves. TABLE OF CONTENTS What sets us apart We believe we have several competitive advantages that will allow us to maintain our position as the industry leader in emerging countries, which include: Extensive global footprint across leading digital platforms. We represent the leading digital platforms across Europe, Asia, Latin America, Middle East and Africa. These platform partners include TikTok, Spotify, Meta, Twitter, Snapchat, Google, Reddit, Twitch, Electronic Arts, Activision Blizzard Media, TripAdvisor, MercadoLibre, Warner Music Group, Accuweather, Verizon, Super League, Moovit and Adswizz, among others. We believe Aleph is the only company that represents over 30 digital platforms across over 90 countries, as of June 30, 2022. Our business model, track record and scale provide our partners with an easy to manage, one-stop solution to efficiently monetize their inventory and rapidly scale their businesses in new markets. Unique, independent market position at the heart of the global digital advertising ecosystem. We believe we are the only company positioned at the center of the global digital advertising ecosystem, serving as the crucial link between digital platforms, advertising agencies and advertisers across the world. We believe that our independent, neutral position within the industry gives us a distinctive competitive advantage to connect to local, regional and global advertisers. We help our partners expand into fast-growing, emerging digital advertising markets, which in turn accelerates overall company growth and creates additional advertising opportunities for advertisers. Additionally, we have established strong relationships over the last decade with digital platforms, advertising agencies and advertisers, which creates a strong barrier to entry for our competitors. Scalable business model supported by a flexible operating infrastructure and positive working capital. We have developed the capability to rapidly and efficiently replicate and expand our footprint across the globe as well as the digital media value chain, which has proven to be one of our keys to expanding successfully to 93 countries worldwide. We have developed a flexible, global operating infrastructure that shares resources efficiently and allows us to quickly pursue and integrate strategic acquisitions, scale operations in emerging countries, expand our technology portfolio and increase our strategic value to both our partners and advertisers. We take advantage of a virtuous cycle in which every new partner, market and advertiser that we add to our portfolio creates value for all stakeholders within our digital ecosystem. Furthermore, we strive to maintain a positive working capital balance, which provides us with financial flexibility required to quickly fund and pursue our strategic growth opportunities. End-to-end, integrated solution for both partners and advertisers. We provide a comprehensive suite of solutions that positions us as a one-stop solution for both our partners and advertisers. Our solutions span the entire spectrum of digital advertising, from digital media expertise, deeply embedded local market knowledge, creative and content services to proprietary campaign management technology. We have also built a robust financial infrastructure that allows us to handle all financial reporting aspects for our partners, including credit, billing, collections, foreign exchanges, local taxes and withholding taxes, and facilitating payments to advertisers, all under full compliance of laws and regulations across local and national markets. We believe we have built an unparalleled end-to-end business model with local operations and strong cross-border infrastructure. Customized advertising market research team and superior creative services. At Aleph, we have experienced marketing and research teams that are focused on educating advertisers on the powerful potential of each of our partners platforms. We do this through newsletters, webinars, white papers, thought leadership and events. We are constantly striving to provide added value services to our partners. For example, in service to Snapchat, we built one of the first and largest augmented reality studios in Latin America, to provide creative and production support to advertisers. Proprietary technology that maximizes advertising efficiency and scalability. We leverage a set of proprietary technology solutions that help advertisers execute, optimize, easily scale and secure their campaigns. Our experience over the years has enabled us to deeply understand advertisers diverse challenges and, as a result, we have designed powerful tools to help them work faster and more efficiently across large digital platforms. TABLE OF CONTENTS Additionally, we have created an all-in-one, self-service platform that makes online advertising accessible on Facebook and easy to use for millions of SMBs across the world. Commitment to unlocking economic development in underserved markets. We leverage our global scale and infrastructure to reach, connect, and develop media professionals across 93 countries. We have strategic partnerships with renowned institutions, such as Stanford Business School and Singularity University, where we have invited clients to participate in virtual and in-person executive education programs that provide our partners and advertisers with access to new educational opportunities that can enhance their professional development. We believe that education offerings are a differentiating factor, especially in the markets where we operate, and that providing these educational opportunities to the digital advertising community we serve will unlock economic development in emerging countries. Founder-led management team with deep digital domain expertise. Many of our regional and partner-managers have extensive experience with digital advertising technologies, advertising agencies and digital platforms and have been at the forefront of digitization in their respective regions. Much like our market coverage, our management team is spread out across the globe, with appointed regional managers overseeing the largest markets and providing a global feedback loop to close knowledge gaps between entities and provide optimal levels of service to our clients and partners. Many members of our founder-led executive team have been working together for decades, with an average tenure of over 25 years of entrepreneurial and scaled experience in digital media and advertising. We are also supported by world-class investors such as CVC Capital Partners, MercadoLibre, Twitter and Snap, who provide important connections and strategic advice. Our Growth Strategies We believe that there are several attractive opportunities for growth beyond what we have already achieved and that we are well-positioned to address these opportunities as penetration of digital advertising continues to expand rapidly across the world. The key elements of our growth strategy are: Grow revenue of current partners and advertisers in current markets. We believe that there is still a substantial number of unreached digital advertisers in the markets where we operate who demand access to the platforms we represent. With our ability to act as a flexible and cost-efficient extension to our partners businesses and provide access to a wide range of attractive advertising opportunities, we believe our partners will continue to trust our solutions to generate incremental revenue for them by growing the number of advertisers on their platforms, increasing the average spend per advertiser and convincing our advertisers to try new platforms. Expand coverage of current partners into new markets. Our expertise is in expanding the footprint of digital platforms to emerging growth markets. From the inception of our partnerships to date, we have demonstrably expanded our partners representation in emerging countries, including taking Twitter from 6 core markets to 73 markets, Spotify from 17 to 54, Snapchat from 2 to 38, Meta from 4 to 11 and TikTok from 1 to 27. We currently operate in 93 countries out of a potential 193, as defined by the United Nations, giving us a large runway for future expansion. Add new partners. Digital platforms are proliferating and are increasingly adding users in emerging countries across the world. With a growing digital advertising ecosystem, we believe we provide a substantial value proposition to both established and new digital platforms by providing access to a wide range of advertisers in emerging countries and meaningfully increasing advertising revenue at lower costs without the complexity of doing it themselves. Deploy SMB solution globally. We believe that SMBs are the foundation of the global economy, accounting for 90% of all business in the world. Despite their widespread presence, the penetration of SMBs into the digital advertising space, albeit growing significantly, has been proportionately smaller compared to that of more established enterprises with larger advertising budgets and resources. We believe we can address this opportunity through further development of our user-friendly, self-service platform, which equips SMBs with the tools to successfully and seamlessly set up, manage, analyze and optimize digital advertising campaigns on Facebook. In the future, we intend to expand this platform to include other partners. TABLE OF CONTENTS Expand to other emerging regions and new technology solutions through M&A. We intend to continue pursuing investments and acquisitions that can help us tap into new geographies and take advantage of their current infrastructure and local expertise. Our large global network allows us to overcome operational and cultural barriers, realize synergies and economies of scale, and continue reinforcing our position as a truly global company. We also see value in companies with proprietary technology that may complement and enhance our current offering and could potentially acquire a company for this purpose. In addition to these core strategies, we believe we are well positioned to pursue additional avenues for growth, including enhancing our technology offerings to leverage the advantages of automation and artificial intelligence and expanding our presence into markets beyond digital media. Summary of risk factors Investing in our common shares involves a high degree of risk. These risks are discussed in more detail in Risk Factors beginning on page 49, and you should carefully consider these risks before making a decision to invest in our Class A common shares. The following is a summary of some of the principal risks we believe we face: Risks relating to our business and industry We have experienced rapid growth in recent periods, which may not be indicative of our future growth. If we fail to maintain our relationships with our business stakeholders, our business, results of operations, financial condition and business prospects could be materially and adversely affected. If we fail to respond to changes in the digital advertising industry, our business model may become less competitive. If the digital advertising market develops more slowly or differently than we expect, our business, growth prospects and financial condition would be materially adversely affected. If we fail to access a consistent supply of digital display advertising inventory and expand our access to such inventory, our business and result of operations could be harmed. We have historically relied, and expect to continue to rely, on engagements with a small number of partners for a substantial majority of our revenue. Competition in the geographic markets in which we operate may intensify. We do not have long-term commitments from our advertisers, and we may not be able to retain advertisers or attract new advertisers to sustain or grow current revenue. Advertiser attrition or a decline in advertisers growth rate could cause our revenues to decline. Failure to manage our growth effectively could cause our business to suffer. We are expanding and may in the future continue to expand into new geographic regions, and our failure to mitigate specific regulatory, credit and other risks associated with a new geographic region could materially and adversely affect our business, results of operations, financial condition and business prospects. We have acquired, and may in the future acquire, other businesses, which could require significant management attention, disrupt our business, dilute shareholder value and materially and adversely affect our results of operations. Our unaudited pro forma information may not be representative of our past or future results. Seasonal fluctuations in advertising activity could adversely affect our results from operations. Our holding company structure makes us dependent on the operations of our subsidiaries. Exchange controls and other restrictions on the movement of capital out of certain jurisdictions or otherwise affecting our subsidiaries ability to pay dividends or make other payments to us could materially and adversely affect our financial condition. TABLE OF CONTENTS If we do not effectively grow and train our sales and support teams, we may be unable to add new clients or increase sales to our existing clients and our business could be adversely affected. If our advertisers delay in settlement of our accounts receivable or if we are unable to issue invoices to our advertisers on a timely basis, our business, financial condition and results of operations may be materially and adversely affected. We cannot predict the full extent of the impact of COVID-19 on our business, financial condition and results of operations. Economic downturns and political and market conditions beyond our control could materially and adversely affect our business, results of operations and financial condition. We are exposed to fluctuations in foreign currency exchange rates. We may be subject to the Economic Substance Regime in the Cayman Islands. Our systems and IT infrastructure may be subject to security breaches and other cybersecurity incidents. Any legal proceedings, investigations or claims against us, including claims resulting from the actions of advertisers or partners, could be costly and time-consuming to defend and could harm our reputation. Uncertainty in the credit markets could affect our ability to obtain additional capital and debt financing on reasonable terms. Our ability to maintain and protect our proprietary technology and intellectual property rights is limited. Changes in financial accounting standards or practices may cause adverse, unexpected financial reporting fluctuations and affect our reported results of operations. Our insurance may not provide adequate levels of coverage against claims or we may be unable to find insurance with sufficient coverage at a reasonable cost. Risks relating to the countries in which we operate Our international footprint subjects us to significant costs and risks that can adversely affect our business, financial condition and operating results. The governments of the countries in which we operate have exercised, and continue to exercise, significant influence over the countries economy. Developments and the perceptions of risks in emerging countries, the United States and Europe, may harm the economies of the countries in which we operate and the price of our Class A common shares. Credit rating downgrading of the countries in which we operate could reduce the trading price of our Class A common shares. Infrastructure and internet connectivity in the countries in which we operate may impact economic growth. We may have difficulty establishing adequate management, legal and financial controls in some of the countries in which we operate, which difficulties may increase if and as our operations expand globally. The invasion of Ukraine by Russia and the consequences arising therefrom have created global security concerns and could have a lasting impact on regional and global economies, which could adversely affect our business. Risks relating to this offering and holding our Class A common shares There is no existing market for our Class A common shares and we do not know if one will develop. Even if a market does develop, the share price in the market may not exceed the offering price. Our dual class capital structure has the effect of concentrating voting control with our Class B shareholders; and this will limit or preclude your ability to influence corporate matters. Upon completion of this offering, our Class B shareholders will together own % of our outstanding common shares and control % of corresponding voting rights, and will have the power, as a group, to elect all of TABLE OF CONTENTS the members of our board of directors, which means that our Class B shareholders, when acting in concert, will have significant influence over matters requiring shareholder approval, and will continue to have substantial control over us, which may limit your ability to influence the outcome of decisions requiring shareholder approval. This concentration of ownership and voting power limits your ability to influence corporate matters. As a new investor, you will suffer immediate and substantial dilution as a result of this offering. Additional share issuances could result in significant dilution to our shareholders. We will have broad discretion in the use of the net proceeds from this offering. The market price of our Class A common shares may be volatile. Future sales of our Class A common shares, or the perception that such sales may occur, could depress our Class A common share price. Our shareholders may face difficulties in protecting their interest because we are a Cayman Islands exempted company. The requirements of being a public company may strain our resources, divert management s attention and affect our ability to attract and retain executive management and qualified board members, which could make it difficult to manage our business, particularly after we are no longer an emerging growth company. We previously identified material weaknesses in our internal control over financial reporting. If we fail to maintain an effective system of internal controls over financial reporting in the future, any material weakness in the future could result in loss of investor confidence and adversely affect our business or share price. We are an emerging growth company and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our Class A common shares less attractive to investors. As a foreign private issuer, we are permitted to, and we will, rely on exemptions from certain NYSE corporate governance standards applicable to U.S. issuers. This may afford less protection to our shareholders. We may lose our foreign private issuer status in the future, which could result in additional cost and expense. If securities or industry analysts do not publish research, or publish inaccurate or unfavorable research, about our business, the price of our Class A common shares and our trading volume could decline. Our dual class capital structure means our shares will not be included in certain indices. We cannot predict the impact this may have on our share price. Our Corporate Structure The following chart shows our simplified corporate structure after giving effect to this offering: TABLE OF CONTENTS (1) Includes Class B common shares beneficially owned by (i) Christian Gaston Taratuta, our Chief Executive Officer, Ignacio Martin Vidaguren, our Chief Operating Officer, and other members of our senior management, in each case indirectly through Aleph Internet Media Services, LLC, (ii) CVC Funds, indirectly through Aleph Maradona LP, and (iii) Aljo a Jenko, our Chief Strategy Officer, indirectly through Akuma Ventures Ltd. (2) IMS Internet Media Services Panama, S. de R.L. (Panama), IMS-Internet Media Services Ecuador S.A. (Ecuador), 10 M dia Publicidade e Propaganda Ltda. (Brazil), Radobel S.A. (Uruguay), IMM Internet Media Mexico, S. de R.L. de C.V. (Mexico), IMS Media, LLC (United States), Internet Media Services Colombia S.A.S. (Colombia), IMS Argentina S.R.L. (Argentina), IMS Chile SpA. (Chile), IMS-Brasil Servi os de Publicidade Ltda. (Brazil), Internet Media Services Per S.R.L. (Peru), Neokei S.A. (Uruguay), Social Media, S.A. (Panama), Snack Media, S.A. de C.V. (Mexico) and SocialMedia S.A. (Argentina) (3) Httpool Internet Marketing, d.o.o. (Slovenia) represents our partners and monetizes their advertising inventory in Slovenia, which accounted for 12% of our Total Advertising Volume for the six-month period ended June 30, 2022. (4) Httpool Latvia SIA (Latvia) represents our partners and monetizes their advertising inventory in Latvia, which accounted for 16% of our Total Advertising Volume for the six-month period ended June 30, 2022. (5) Httpool Baltics OU (Estonia) represents our partners and monetizes their advertising inventory in Estonia, which accounted for 10.% of our Total Advertising Volume for the six-month period ended June 30, 2022. (6) Internet Media Services Europe, S.L.U. (Spain), Internet Media Services Europe, S.L.U. Italian Branch (Italy) and Social Snack, S.L.U. (Spain). (7) Httpool Online Marketing GmbH (Austria), NOOVO Internet D.O.O. (Croatia), Httpool Baltics OU (Estonia), Httpool DOOEL (North Macedonia), Httpool Online and Mobile Advertising Srl (Romania), Httpool Bulgaria EOOD (Bulgaria), Httpool a.s. (Czech Republic), Httpool Hellas MIKE (Greece), HTTPool Sh.p.k. (Kosovo), Httpool Polska sp. Z.o.o. (Poland), Httpool d.o.o. Beograd (Vra ar) (Serbia), Httpool Hungary Kft. (Hungary), Httpool LLC (Russia), Httpool Ukraine LLC (Ukraine), Httpool Lithuania UAB (Lithuania), Httpool Norway AS (Norway), Httpool Oy (Finland), Httpool AB (Sweden), Httpool Denmark ApS (Denmark), Httpool s.r.o. (Slovakia), Httpool SHPK (Albania), Httpool d.o.o. Podgorica (Montenegro), Vow Made Ltd. (United Kingdom) and Httpool Cyprus Ltd. (Cyprus). (8) Httpool Asia Ltd. (Hong Kong), Httpool Digital Marketing FZE (United Arab Emirates), Httpool Digital Private Ltd. (India), Httpool Myanmar Ltd. (Myanmar), Httpool (Cambodia) Co., Ltd. (Cambodia), Httpool Bangladesh Ltd. (Bangladesh), Httpool Digital Malaysia Sdn. Bhd. (Malaysia), Httpool Lao Sole Co., Ltd. (Laos), PT Httpool Digital Indonesia (Indonesia), Httpool Kazakhstan LLC (Kazakhstan), Httpool Digital Mongolia LLC (Mongolia), H.T.T.Pool Nepal Pvt. Ltd. (Nepal), Httpool Israel Ltd. (Israel), Httpool Digital Pte. Ltd. (Singapore), Httpool Taiwan (Taiwan), Httpool Digital LLC (Uzbekistan), Skystart Technologies FZ-LLC (United Arab Emirates) and Mediam Bangladesh Ltd. (Bangladesh). (9) Ad Dynamo International (Pty) Ltd. (South Africa), Ad Dynamo Holdings Ltd. (United Kingdom), Ad Dynamo UK Ltd. (United Kingdom), Ad Dynamo Ireland Ltd. (Ireland), Bangers and Mash (Pty) Ltd. (South Africa), Ad Dynamo Kenya Ltd. (Kenya) and Ad Dynamo Digital Marketing Ltd. (Nigeria). (10) Connect Ads DMCC (United Arab Emirates), Connect Ads KSA LLC (Saudi Arabia), Genart Medya Reklamcilik leti im Ticaret A. . (Turkey), Techno Dev LLC (Egypt), Connect Ads for Advertising and Programming S.A.E. (Egypt), 4G for Advertising Technology LLC (Egypt), Connect Ads Italy S.r.l. (Italy)and CADS Moroc SARLAU (Morocco). See Note 26 to our Audited Financial Statements and Note 1.1 of our Unaudited Financial Statements. Recent developments Acquisition of Connect Ads On February 14, 2022, we acquired 86% of the shares of Connect Ads DMCC pursuant to the Amended SPA. Connect Ads is a digital media group based in the Middle East, with presence in Africa, Europe and the Middle TABLE OF CONTENTS East. Under the terms of the Amended SPA, we paid A15, as seller, U.S.$52.4 million and delivered shares of our common stock representing 4.38% of our issued share capital, subject to certain post-closing adjustments. In addition, we granted A15 a put option in respect of its remaining 14% equity interest in Connect Ads upon the occurrence of certain events. For additional information, see Unaudited Pro Forma Condensed Consolidated Financial Information. Connect Ads has operations in 15 countries throughout Africa, Europe and the Middle East, including Algeria, Bahrain, Egypt, Italy, Jordan, Kuwait, Lebanon, Morocco, Oman, Pakistan, Qatar, Saudi Arabia, Tunisia, Turkey and the United Arab Emirates. On February 6, 2022, we entered into a loan agreement with Citibank, N.A., Goldman Sachs Lending Partners LLC, JPMorgan Chase Bank, N.A. and Bank of America, N.A., as initial lenders and Citibank, N.A. as administrative agent in order to finance a portion of the consideration. For additional information, See Management s Discussion and Analysis of Financial Condition and Results of Operations Liquidity and Capital Resources Indebtedness Term Loan Agreement. Acquisition of LDM Servicios Digitales S.A. On July 12, 2022, we acquired 49% of the shares of LDM Servicios Digitales S.A., a Panama corporation that engages in digital media services in the region (which we refer to as Mediam ) from LDMCOM Digital Inc. for a purchase price equal to 49% of 10x Mediam s 2023 consolidated EBITDA, subject to certain adjustments for Mediam s net debt, net working capital and certain other concepts. On the closing date, we agreed to pay an estimated purchase price of U.S.$19.6 million, which assumes a 2023 consolidated EBITDA of Mediam equal to U.S.$4.0 million and certain adjustments. The final purchase price will be calculated once Mediam s audited financial statements become available, which may result in a further payment by us or a reimbursement of a portion of the estimated purchase price by LMDCOM Digital Inc., based on Mediam s actual 2023 consolidated EBITDA, as well as actual net debt, net working capital and other adjustments, provided, however that, in no event will the final purchase price be higher than U.S.$36.8 million. LMDCOM Digital Inc. owns the remaining 51% of the shares of Mediam. For so long as LDMCOM Digital Inc. owns 51% of the common stock of Mediam, Mediam s business and affairs will be managed exclusively by LDM, except as otherwise provided in the Mediam shareholders agreement or as required by Panamanian laws. Acquisition of Vow Made Limited On August 8, 2022, our subsidiary Httpool Holdings UK Limited ( Httpool ) acquired 51% of the shares of Vow Made Limited ( Vow Made ), an English corporation engaged in the development, creation, exploitation and commercialization of software for planning, buying execution and reporting of digital media investments related to Amazon ad products. At the closing of the transaction, Httpool acquired 47% of newly-issued shares of Vow Made in a capital increase for an aggregate subscription price of 1.25 million EUR, and acquired 7.48% of outstanding shares of Vow Made from one of the existing shareholders of Vow Made for a purchase price of 105,263 EUR, which represent 4% of the total shares. The total subscription price for the newly-issued shares will be paid to Vow Made in two tranches: (a) a first tranche of 625,000 EUR, which was deposited in escrow upon completion and will be released once certain conditions have been met, and (b) a second tranche, of 625,000 EUR, to be paid on the six-month anniversary of the first payment. The existing shareholders of Vow Made continue to own the remaining 49% of the shares of Vow Made. Pursuant to the shareholders agreement for Vow Made, the shareholders will exercise their respective voting rights in Vow Made and take such other steps as are necessary to ensure that the directors appointed by Httpool represent a majority of the Board of Directors. As long as Httpool holds at least 25% of the shares in issue, it will be entitled to appoint at least two directors to the Board of Directors. Acquisition of Neokei S.A. On June 17, 2022, our Board of Directors approved a share-for-share swap transaction to acquire shares representing 25% of the voting stock of Neokei S.A. ( Neokei ) from Bohemia Plus Inc ( Bohemia ), in exchange for the issuance of a certain number of our new shares to Bohemia in four equal yearly tranches. On TABLE OF CONTENTS September 21, 2022, we entered into the share swap agreement with Bohemia and completed the swap of the first tranche, issuing 27,952 ordinary shares representing 0.333% of our issued and outstanding capital, and Bohemia signed a joinder to our Existing Shareholders Agreement (as defined below). The remaining 75% of Neokei s stock was already indirectly owned by the Company, and Neokei will become our wholly-owned subsidiry after completion of the swap of the four tranches of this transaction. Estimated preliminary and selected financial results (Unaudited) The following tables present our current outlook for certain of our operating and financial data for the three-month period ended September 30, 2022. Because we are in the process of closing our financial results for the three-month period ended September 30, 2022, this data is subject to change. The data presented below is based only on currently available information and does not present all necessary information for an understanding of our financial condition as of September 30, 2022 or our results of operations for the three-month period ended September 30, 2022. This financial information has been prepared by and is the responsibility of our management and is subject to revisions based on our procedures and controls associated with the completion of our financial reporting closing, including all the customary reviews and approvals. Therefore, our independent registered public accounting firm has not audited, reviewed, examined, compiled, or applied agreed-upon procedures with respect to this preliminary financial data or the accounting treatment thereof and does not express an opinion or any other form of assurance with respect thereto. The preparation and review of our unaudited interim condensed consolidated financial statements as of September 30, 2022 and for the nine and three month periods ended September 30, 2022 and 2021 will not be completed until subsequent to this offering. During the course of the preparation of our financial statements and related notes for the period from July 1 to September 30, 2022, additional adjustments to the preliminary estimated financial information presented below may be identified. Any such adjustments may lead to differences in our actual results, which are not expected to differ materially from that reflected in the preliminary estimated financial results. The information below represents preliminary estimates, and are not necessarily indicative of our actual results for the three-month period ended September 30, 2022 or any future period. For these reasons, you should not place undue reliance on these preliminary estimates. These preliminary estimates should be read together with Risk Factors, Forward-Looking Statements, Presentation of Financial and Other Information and our consolidated financial statements and related notes thereto. Three months ended September 30,2022 Three months ended September 30, 2021 Variation vs. three months ended September 30, 2021 (%) Low High Low High (in thousands of U.S.$) TAV 337,500 375,000 237,442 42.1% 57.9% Income Statement Three months ended September 30,2022 Three months ended September 30, 2021 Variation vs. three months ended September 30, 2021 (%) Low High Low High (in thousands of U.S.$) Revenues, net 47,700 53,000 30,240 57.7% 75.3% Costs of revenues (5,500) (6,100) (4,808) 14.4% 26.9% Selling, general and administrative expenses (26,100) (28,500) (19,812) 31.7% 43.9% Depreciation and amortization expense (3,150) (3,500) (489) 544.2% 615.7% TABLE OF CONTENTS Three months ended September 30,2022 Three months ended September 30, 2021 Variation vs. three months ended September 30, 2021 (%) Low High Low High (in thousands of U.S.$) Income from operations 12,950 14,900 5,131 152.4% 190.4% Interest expense, net (900) (1,000) (231) 289.6% 332.9% Other financial results, net (4,140) (4,600) (365) 1,034.2% 1,160.3% Net income before income tax 7,910 9,300 4,535 74.4% 105.1% Income tax expense (3,220) (3,680) (1,115) 188.8% 230.0% Net income 4,690 5,620 3,420 37.1% 64.3% Adjusted EBITDA Three months ended September 30,2022 Three months ended September 30, 2021 Variation vs. three months ended September 30, 2021 (%) Low High Low High (in thousands of U.S.$) Net Income 4,690 5,620 3,420 37.1% 64.3% Income tax expense 3,220 3,680 1,115 188.8% 230.0% Net loss on foreign currency transactions 4,140 4,600 365 1034.2% 1,160.3% Interest expense, net 900 1,000 231 289.6% 332.9% Depreciation and amortization expense 3,150 3,500 489 544.2% 615.7% Other expenses(1) 2,000 2,500 3,337 (40.1)% (25.1)% Adjusted EBITDA 18,100 20,900 8,957 102.1% 133.3% (1) Other expenses include IPO expenses (not capitalized), Transaction-related expenses on acquisition of businesses, share-based compensation plan and stamp tax on Akuma s flip-up. FX Neutral Measures Three months ended September 30,2022 FX Neutral Measures Three months ended September 30, 2021 As Reported Variation vs. three months ended September 30, 2021 (%) Low High Low High (in thousands of U.S.$) Total Advertising Volume (Unaudited) 394,215 438,017 237,442 66.0% 84.5% Revenues, Net 55,716 61,906 30,240 84.2% 104.7% We expect TAV and revenues, net, to increase between 42.1% to 57.9% and 57.7% to 75.3%, respectively, for the three months ended September 30, 2022 compared to the three months ended September 30, 2021, primarily due to a continued acceleration in growth in sales in existing markets, as a result of the ongoing growth in internet and smartphone penetration in emerging countries and the increasing number of consumers shifting to online platforms, as well as the acquisitions of Ad Dynamo and Connect Ads, which were consummated in November 2021 and February 2022, respectively. We expect cost of revenues to increase between 14.4% to 26.9% for the three months ended September 30, 2022 compared to the three months ended September 30, 2021, mainly as a result of the increase in revenues, net. The increase in cost of revenues is lower than the increase in revenues, net, due to gaining scale and efficiency. TABLE OF CONTENTS We expect selling, general and administrative expenses to increase between 31.7% to 43.9% for the three months ended September 30, 2022 compared to the three months ended September 30, 2021, mainly due to the integration of Connect Ads and Ad Dynamo. We expect Adjusted EBITDA to increase between 102.1% to 133.3% for the three months ended September 30, 2022 compared to the three months ended September 30, 2021, primarily as a result of the accelerated growth of our Net Revenue, scaling the business and increasing our EBITDA Margin. We expect net income to increase between 37.1% to 64.3% for the three months ended September 30, 2022 compared to the three months ended September 30, 2021, mainly as a result of the factors described above, offset by a significant increase in our depreciation, mainly due to intangible asset of the acquisitions mentioned above, and also due to the FX, mainly related to depreciation of the Euro. Corporate information Our principal executive offices are located at ELOB Office E-23G-14 Hamriyah Free Zone, Dubai, United Arab Emirates and Echeverr a 1515, 11th Floor, C1428DQS CABA, Buenos Aires, Argentina. Our telephone numbers are +971 42 64 89 99 and +54 1 14 78 57 007. Investors should contact us for any inquiries through the address and telephone number of our principal executive office or at the following e-mail address: investor@alephholding.com. Our principal website is alephholding.com. The information contained in, or accessible through, our website is not incorporated into this prospectus or the registration statement of which it forms a part. Ownership For purposes of the NYSE listing rules, we will be a controlled company because more than 50% of the voting power of our shares will be held by . Implications of being an emerging growth company As a company with less than U.S.$1.07 billion in revenue during our latest fiscal year of the financial statements, we qualify as an emerging growth company as defined in the Jumpstart our Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies. These provisions include: the ability to present more limited financial data for our initial registration statement on Form F-1, including presenting only two years of audited financial statements and only two years of selected financial data, as well as two years of related Management s Discussion and Analysis of Financial Condition and Results of Operations disclosure; an exemption from the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended, or the Sarbanes-Oxley Act, in the assessment of our internal control over financial reporting; reduced disclosure about our executive compensation arrangements in our periodic reports, proxy statements and registration statements; and exemptions from the requirements of holding non-binding advisory votes on executive compensation and golden parachute arrangements. We may take advantage of these provisions for up to five years or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company if we have U.S.$1.07 billion or more in annual revenue, have U.S.$700 million or more in market value of our Class A common shares held by non-affiliates or issue more than U.S.$1.0 billion of non-convertible debt over a three-year period. We may choose to take advantage of some but not all of these reduced burdens and, accordingly, the information that we provide shareholders may be different than you might get from other public companies in which you hold equity. TABLE OF CONTENTS Under the JOBS Act, emerging growth companies can also delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have elected to take advantage of the extended transition period for complying with new or revised accounting standards until those standards would otherwise apply to private companies or at which time we conclude it is appropriate to avail ourselves of early adoption provisions of applicable standards. As a result, our results of operations and financial statements may not be comparable to the results of operations and financial statements of other companies who have adopted the new or revised accounting standards. TABLE OF CONTENTS
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+Prospectus summary This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our common stock. You should read this entire prospectus carefully, especially the sections titled Risk factors and Management s discussion and analysis of financial condition and results of operations and our combined financial statements and related notes included elsewhere in this prospectus, before making an investment decision. As used in this prospectus, unless the context otherwise requires, references to we, us, our, the Company and HilleVax refer to HilleVax, Inc., its subsidiaries, and North Bridge V, Inc. and YamadaCo III, Inc. prior to the Merger. Our founders and inspirations We are founded on the legacies of leading vaccine developers who inspire us to build a company to benefit human health on a global scale. Our late co-founder, Dr. Tadataka Tachi Yamada, championed vaccines as a powerful means to address health inequities and equalize opportunity for people around the world. As the former Chief Medical and Scientific Officer at Takeda Pharmaceutical Company Limited (Takeda Pharmaceuticals), Tachi helped establish Takeda Pharmaceuticals vaccine pipeline, which included the most advanced norovirus vaccine candidate in clinical development. Through his most recent role as a venture partner at Frazier Healthcare Partners (Frazier), he helped Frazier and Takeda Pharmaceuticals launch their third collaboration, HilleVax, to continue the development of this novel norovirus vaccine candidate, HIL-214 (formerly TAK-214). At HilleVax, we aim to continue Tachi s mission of improving global health with a sense of urgency by always putting patients first. Our work, and company name itself, is also inspired by Dr. Maurice Hilleman. Dr. Hilleman is considered by many to be the father of modern vaccines. He developed many of the vaccines that are routinely recommended for children today. By the end of his career, Dr. Hilleman had played a key role in developing more than forty vaccines, including those for the flu, chickenpox, hepatitis A, hepatitis B, pneumococcus, meningococcus, measles, mumps, rubella, and other diseases. These vaccines are estimated to save millions of lives every year. We are honored that his daughter, Jeri Hilleman, serves on our Board of Directors. We aim to have a global impact on human health and believe the best way to achieve this goal is by developing novel vaccines for severe and life-threatening diseases. HIL-214 is our foundational vaccine candidate from which we are building our company. We are honored to continue Dr. Yamada s and Dr. Hilleman s legacies through the further development of HIL-214 and other potential vaccine candidates. Overview We are a clinical-stage biopharmaceutical company focused on developing and commercializing novel vaccines. Our initial program, HIL-214, is a virus-like particle (VLP) based vaccine candidate for the prevention of moderate-to-severe acute gastroenteritis (AGE) caused by norovirus infection. It is estimated that norovirus causes nearly 700 million cases of illness and more than 200,000 deaths worldwide per year, as well as significant additional economic and social burden. To date, HIL-214 has been studied in nine clinical trials conducted by Takeda Vaccines, Inc. (Takeda) and its predecessor, LigoCyte Pharmaceuticals, Inc. (LigoCyte), which collectively generated safety data from more than 4,500 subjects and immunogenicity, or the ability of the vaccine to provoke an immune response, data from more than 2,200 subjects, including safety and immunogenicity data from more than 800 pediatric subjects. A randomized, placebo-controlled Phase 2b field efficacy trial enrolled 4,712 adult subjects, and HIL-214 was well tolerated and demonstrated clinical proof of concept in preventing moderate-to-severe cases of AGE from norovirus infection. In September 2021, an open investigational new drug application (IND) was transferred to us from Takeda, under which we plan to initiate a Phase 2b clinical Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED APRIL 25, 2022 Preliminary Prospectus 10,294,000 shares Common stock This is the initial public offering of shares of common stock by HilleVax, Inc. We are selling 10,294,000 shares of our common stock. The initial public offering price is expected to be between $16.00 and $18.00 per share. Prior to this offering, there has been no public market for our common stock. We have applied to list our common stock on the Nasdaq Global Select Market under the symbol HLVX. We are an emerging growth company as defined under the federal securities laws and, as such, have elected to comply with certain reduced public company reporting requirements. Per share Total Initial public offering price $ $ Underwriting discounts and commissions(1) $ $ Proceeds to HilleVax, Inc., before expenses $ $ (1) See Underwriting for a description of the compensation payable to the underwriters. At our request, the underwriters have reserved up to 5% of the shares of common stock offered by this prospectus for sale, at the initial public offering price, to certain individuals associated with us. See Underwriting Directed share program. We have granted the underwriters an option for a period of 30 days to purchase up to 1,544,100 additional shares of our common stock. Investing in our common stock involves a high degree of risk. See Risk factors beginning on page 15. Neither the Securities and Exchange Commission nor any other state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The underwriters expect to deliver the shares of common stock to purchasers on , 2022. J.P. Morgan SVB Securities Stifel Guggenheim Securities , 2022 Table of Contents trial in the second quarter of 2022 to evaluate the safety, immunogenicity, and efficacy of HIL-214 in infants. We expect to report interim safety data from this trial for the first 200 subjects in the second half of 2022, interim immunogenicity data for the first 200 subjects in the first half of 2023, and top-line data in the second half of 2023. We believe HIL-214 has the potential to be the first ever vaccine approved for norovirus-related illness and that it will help grow HilleVax into a leading global vaccines company. Our pipeline The following chart summarizes our current development programs. Norovirus overview Noroviruses are a group of small, non-enveloped viruses belonging to the Caliciviridae family. Noroviruses contain a single-stranded positive-sense RNA genome that codes for seven nonstructural and two structural proteins. The first structural protein, VP1, encodes the major capsid protein, or the protein shell of a virus. VP1 is further subdivided into the N-terminal, shell, and protruding domains. The protruding domain of VP1 is present on the surface of viral particles and is necessary for binding to histo-blood group antigens (HBGAs), which are chains of simple sugars found on the epithelia of the respiratory, genitourinary, and digestive tracts, as well as in body fluids such as blood and saliva. Noroviruses are classified into ten genetic groups called genogroups. These genogroups, GI through GX, are based on amino acid diversity in the major capsid protein VP1. Genogroups GI and GII are responsible for the majority of human infections across major geographies worldwide, with GII accounting for an estimated 96% of global prevalence. Norovirus genogroups are further subdivided into at least 48 genotypes: 9 genotypes in GI, 26 genotypes in GII, and 13 genotypes in GIII through GX. A single genotype, GII.4, is estimated to be responsible for nearly two-thirds of norovirus outbreaks in both developed and developing countries. GII.4 has been the dominant genotype in circulation for the last two decades, and of the GII.4 strains, GII.4 Sydney 2012 has been the predominant variant detected worldwide since 2012. In addition to causing the majority of norovirus infections, hospitalizations and deaths were more likely in outbreaks associated with GII.4 viruses. Table of Contents Table of contents Page Prospectus summary 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: common stock are to our Class A common stock and our Class B common stock, collectively; directors are to our current directors and director nominees named in this prospectus; founder shares are to shares of our Class B common stock initially purchased by our sponsor in a private placement prior to this offering and the shares of our Class A common stock issuable upon the conversion thereof as provided herein; initial stockholders are to our sponsor and any other holders of our founder shares prior to this offering (or their permitted transferees); management, our management team or our team are to our officers and directors; placement shares are to the shares of our common stock included within the placement units being purchased by our sponsor and the representative in the private placement; placement units are to the units being purchased by our sponsor and the representative in the private placement, each placement unit consisting of one placement share and three-fourths of one placement warrant; placement warrants are to the warrants included within the placement units being purchased by our sponsor and the representative in the private placement; private placement are to the private placement of 1,240,000 placement units (or 1,360,000 placement units if the over-allotment option is exercised in full) at a price of $10.00 per unit, for an aggregate purchase price of $12,400,000 (or $13,600,000 if the over-allotment option is exercised in full), which will occur simultaneously with the completion of this offering; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder s and member of our management team s status as a public stockholder shall only exist with respect to such public shares; public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market, including warrants that may be acquired by our sponsor or its affiliates in this offering or thereafter in the open market); representative is to Mizuho Securities USA LLC, which is the representative of the underwriters in this offering; representative shares are to shares of our Class A common stock that will be issued to the representative of the underwriters upon the consummation of this offering; sponsor is to Twelve Seas Sponsor IV TMT LLC, a Delaware limited liability company; warrants are the public warrants, the placement warrants and any warrants issued upon conversion of working capital or extension loans; and we, us, company or our company are to Twelve Seas Investment Company IV TMT, a Delaware corporation. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. 1 Table of Contents Our Company We are a newly organized blank check company formed as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. While we may pursue an initial business combination target in any business or industry, we intend to focus our search on the global TMT sector. Our Management Team Our Chairman, Neil Richardson, has over 35 years of private equity and investment banking experience. For the last ten years, Mr. Richardson has structured and overseen family office activities, conducted through North Sea Capital, which included the joint purchase with Apollo of Watches of Switzerland Group PLC. Formerly, he was a General Partner of Kohlberg Kravis Roberts & Co. ( KKR ), one of the world s leading private equity firms, where he helped establish KKR s European operations and where he was responsible for European telecom, media and technology investment. Subsequently, Mr. Richardson co-founded Lion Capital, a leading global private equity firm which evolved to have over 8 billion of assets under management ( AUM ). Mr. Richardson was also Chairman of Twelve Seas Investment Company ( Twelve Seas I ) from December 2017 to December 2019 and has been Chairman of Twelve Seas Investment Company II ( Twelve Seas II ) since February 2021. Mr. Richardson has served as a Director of numerous companies including Newsquest Capital Limited, Wincor Nixdorf AG, Tenovis GmbH, Russian Alcohol Group JSC, American Apparel Inc. and Watches of Switzerland Group PLC. Mr. Richardson graduated from Oxford University and received a Master s Degree in Chemistry. Our Vice Chairman and Chief Executive Officer, Joseph Euteneuer, has over 37 years of experience as a financial executive and board member with a diversified history at publicly traded technology, telecom and cable corporations. Since September 2020, he has served on the board of NAX Group, a privately held financial technology company that creates new markets and ecosystems around corporate assets, where he is responsible for facilitating the audit and finance committees work with management on the development of accounting and finance infrastructures. From September 2017 to August 2020, Mr. Euteneuer was the Chief Financial Officer of Mattel Inc., a leading global toy company, where he worked closely with the Chief Executive Officer, other executives and the board of directors to lead Mattel s business transformation strategy and was responsible for the execution of a reorganization and cost improvement plan. From May 2016 to September 2017, Mr. Euteneuer was Co-Chief Executive Officer and Chief Financial Officer of Rivada Networks, Inc., a leading U.S. communications technology company. As Co-Chief Executive Officer, Mr. Euteneuer led all fundraising activities, corporate development activities, including mergers and acquisitions, and partnership development with numerous country partners. Before that, from April 2011 to December 2015, Mr. Euteneuer was the Chief Financial Officer of Sprint Corporation ( Sprint ), a wireless and wireline communication services company, prior to its merger with T-Mobile US, Inc. ( T-Mobile ). Mr. Euteneuer was responsible for all aspects of balance sheet and operational improvements, mergers and acquisitions, and market-facing activities including capital markets issuances and investor relations. Additionally, while at Sprint, Mr. Euteneuer was responsible for the completion of its merger with Softbank and its acquisitions of Clearwire and Spectrum. Before Sprint, Mr. Euteneuer was the Chief Financial Officer and Executive Vice President of Qwest Communications International and was responsible for turnaround activities in the business as well as execution of a reorganization and cost improvement plan. He was also responsible for the execution of its merger with CenturyLink Communications. From 2002 to 2008, Mr. Euteneuer was the Chief Financial Officer and Executive Vice President of XM Satellite Radio, where he completed the merger with Sirius Satellite Radio and oversaw the company s aggressive growth strategy. Mr. Euteneuer also spent 14 years at Comcast, where he held key financial roles including Chief Financial Officer of Comcast s European subsidiary. Mr. Euteneuer is a certified public accountant and previously worked in public accounting at PricewaterhouseCoopers and Deloitte. Mr. Euteneuer graduated from Arizona State University with a Bachelor of Science degree in Accounting and received an M.B.A. from the Fuqua School of Business at Duke University. Our President, Chief Investment Officer and Director, Alan B. Mitchell, has over 27 years of experience in investment and merchant banking. He began his investment banking career in 1994 at Solomon Brothers Inc. in the Telecommunications Group, which later became Citigroup and was promoted to Managing Director in 2000. Since 2016, Mr. Mitchell has been the President and Chief Operating Officer of Spain Telecom LLC, a merchant banking 2 Table of Contents and private equity firm focusing on communications infrastructure companies in Europe and Latin America, where he is responsible for sourcing investment opportunities and capital for international communication infrastructure investments. From 2005 to 2016, Mr. Mitchell was a Managing Director and Head of Communication Infrastructure and Services at Wells Fargo Securities, where he led the team s strategic initiatives and transaction execution. From 2002 to 2005, Mr. Mitchell was the President and Managing Partner of Viant Group LLC, a boutique investment bank where in addition to managing the firm s investment banking efforts, he also led the formation of a long-short hedge fund in the U.S. and U.K. and was responsible for the firm s regulatory management oversight and compliance. Mr. Mitchell began his career in public accounting at KPMG in 1985, and is a licensed certified public accountant in Texas. Mr. Mitchell graduated from Texas A&M University with a Bachelor s degree in Accounting and graduated with an M.B.A. from Columbia Business School with honors. Our Chief Operating Officer, Dimitri Elkin, has over 25 years of experience in private equity, investment banking and consulting. During his tenure at KKR, Mr. Elkin led KKR s activities in the former Soviet Union and Eastern Europe. From 2007 until April 2013, Mr. Elkin served as a General Partner of UFG Private Equity, a private equity firm based in Moscow focused on telecom infrastructure and technology investments. From November 2016 until December 2017, he served as an advisor to Trilogy Capital Group, an international private equity company headquartered in Moscow. From December 2017 until December 2019, he was the Chief Executive Officer and a Director of Twelve Seas I and has been the Chief Executive Officer and a Director of Twelve Seas II since July 2020. From December 2019 until July 2021, he served as a managing partner with Twelve Seas Capital, a boutique private equity advisory firm. Mr. Elkin previously served as director of several other entities, including OOO Kamaz, ZAO Imperial Porcelain Company and OOO Russian Alcohol. Mr. Elkin graduated from Moscow State University and received an M.B.A. from Harvard Business School. Our Chief Financial Officer, Jonathan Morris, has over 24 years of experience as a finance executive, principal, operator and advisor. He currently serves as the Chief Financial Officer of Twelve Seas II (where he also serves as a director), FreeCast, Inc. and Hush Aerospace LLC, as well as the Chief Development Officer of TLG Acquisition One Corp. Prior to these roles, Mr. Morris served as Chief Financial Officer at Imageware Systems, Inc. in 2020 and from 2016 to 2020, led principal investments and structuring as President and Senior Managing Director at a large private family office. Prior to that, at Blackstone Group, Inc., he focused on telecom and technology investments and served on the board of SunGard AS. From 2005 to 2012, Mr. Morris was part of the TMT Investment Banking Group of Credit Suisse. Mr. Morris began his career in 1997 within the private equity division of Lombard, Odier et Cie, private bank in Switzerland and subsequently went to work as an associate at GAIN Capital, a currency hedge fund, from 1999 to 2003. Mr. Morris earned his B.S. in Economics and Finance from the University of Virginia and his M.B.A. from Georgetown University. Our Director Nominees Our director nominee, Constantino de Oliveira Junior, has extensive executive experience. Mr. Junior began serving as the Chairman of the board of directors of GOL Linhas A reas Inteligentes ( GOL ) in July 2012, after having served as GOL s Chief Executive Officer and a member of its board of directors from March 2004 to July 2012. From June 2013 to August 2021, Mr. Junior served as chairman of Smiles, a loyalty program controlled by GOL, which was acquired by the airline in September 2021. Mr. Junior has also served as a member of the board of directors of VRG Linhas A reas S.A. (the successor of GOL Transportes A reos S.A. as a result of the merger conducted on September 30, 2008) since 2001, having held the position of Chief Executive Officer at the same company from 2001 to July 2012. Mr. Junior has acquired knowledge and experience within the TMT ecosystem as part of launching GOL (one of the largest and first low cost carrier airline services in Latin American), providing customer user experience by its reservation, cargo and the supply chain airline systems, supported by technology and telecommunications solutions. Mr. Junior is a Managing Partner at Comporte Participa es, a company that controls several passenger road transportation companies in Brazil. Mr. Junior is also a member of GOL s Committees of Risk Policy, Financial Policy, People Management and Corporate Governance Policies and of Alliances. He studied business administration at the Federal District University and attended the Executive Program on Corporate Management at the Association of Overseas Technical Scholarships. Our director nominee, Ron LeMay, is a corporate executive, serial entrepreneur and early-stage investor with over 50 years of experience. He serves as Managing Director and Co-Founder of OpenAir Equity Partners as well as Chief Executive Officer of one of its portfolio companies, Main Street Data. OpenAir Equity Partners specializes in broadband communications and the Internet of Things associated with related data science investments. Its portfolio 3 Table of Contents companies focus on connected car, home, and agriculture product and climate related (carbon) opportunities by shaping highly differentiated data into solutions that impact business processes, companies and industry segments. Previously, Mr. LeMay served as President of Sprint Long Distance. Mr. Lemay was the first employee and Chief Executive Officer of Sprint PCS from its start-up in 1995 and Chief Operating Officer of Sprint Corporation until 2003 during which time it had grown to approximately 35,000 employees, and from pre-revenue to $10 billion in annual revenues. Upon retiring from Sprint in 2003, he served as Chief Executive Officer of Japan Telecom until its sale to SoftBank. In addition, Mr. LeMay was instrumental in the founding of GoGo Inflight Internet Services, where he served as Chairman twice and Chief Executive Officer once, and Hyla Mobile. He has served on seven public company boards, which include The Allstate Corporation, Sprint Corporation, Gogo Inc., Yellow Corporation, Aquila Inc., Ceridian Corporation and Imation Corp. (now known as GlassBridge Enterprises, Inc.), and numerous private company boards over the last 20 years. Mr. LeMay attended Southern Arkansas University where he earned a bachelor s degree, and he also attended the University of Arkansas School of Law where he graduated with honors. Our director nominee, Eric Medow, has over 30 years of investment banking experience in the TMT sector. In September 2021, Mr. Medow retired from Lazard where he had been the Co-Head of the Global Technology, Media and Telecommunications practice since October 2015. Since retiring, Mr. Medow has managed public and private investments for his family. At Lazard, Mr. Medow was responsible for developing relationships across the TMT landscape as well as executing private and public company strategic transactions. While at Lazard, Mr. Medow led teams representing, among others, Intel, CBS, HPE, Tribune Publishing, Stonepeak Infrastructure, and Level 3 Communications. Prior to Lazard, Mr. Medow served as the Global Head of the Telecommunications Group and Co-Head of the North American Communications Group at Citigroup. Prior to Citigroup, Mr. Medow served as a Managing Director at the Carlyle Group where he focused on TMT private equity investments and served on the boards of Videotron s fiber telecom business in Canada as well as Kestrel Solutions, a fiber optic technology company. Mr. Medow began his career in the Telecommunications and M&A groups at Salomon Brothers Inc. Mr. Medow graduated magna cum laude with a B.A. in Economics from Duke University. Our director nominee, Alastair John Mackenzie Walton, has decades of experience as an investment banker. Mr. Walton, is currently the Co-Founder and Partner of Dyne Capital LLC, a merchant bank. Prior to this Mr. Walton had two diplomatic appointments in the United States as the Consul-General of Australia in New York (2017 to 2020) and Texas (2015 to 2017). Before his diplomat roles, Mr. Walton held various senior positions as an investment banker and a company director. These included Chairman of BKK Partners, Chairman of Central Rand Gold PLC, Co-Chairman and Managing Director of Goldman Sachs Australia and Managing Director & Head of Investment Banking for Non-Japan Asia with Credit Suisse. Mr. Walton has a Bachelor of Economics from the Australian National University, an M.B.A. from Columbia University and is a Chartered Accountant. Certain members of our management team have successfully executed a similarly structured blank check company. Twelve Seas I completed its initial public offering in June 2018, raising $207 million. In December 2019, Twelve Seas I completed its initial business combination with Brooge Holdings, an oil storage company located in the United Arab Emirates in a transaction valued at approximately $1.0 billion. Brooge Holdings common stock is traded on The Nasdaq Stock Market under the symbol BROG. Twelve Seas II completed its initial public offering in March 2021, raising $345 million and trades under the symbol TWLV. Past performance of our management team and director nominees or advisors does not guarantee either (i) success with respect to any business combination we may consummate or (ii) that we will be able to identify a suitable candidate for our initial business combination. You should not rely on the historical performance record of our management team as indicative of our future performance. Additionally, in the course of their respective careers, members of our management team and our director nominees have been involved in businesses and deals that were unsuccessful. For a list of our executive officers, director nominees and entities for which a conflict of interest may or does exist between such persons and the company, as well as the priority and preference that such other entities have with respect to performance of obligations and presentation of business opportunities to us, please refer to the table and subsequent explanatory paragraph under Management Conflicts of Interest. Members of our management team are not obligated to devote any specific number of hours to our matters, but they intend to devote as much of their time as they, in the exercise of their respective business judgement, deem necessary to our affairs until we have completed our initial business combination. The amount of time that any member of our management team will devote in any time period will vary based on whether a target business has been selected for our initial business combination and the current stage of the business combination process. We do not have an employment agreement with any member of our management team. 4 Table of Contents See the section of this prospectus entitled Management for a more complete description of our management team s experience. In addition to our experienced and qualified management team and director nominees, we expect to have guidance and advice from the following board advisors, none of whom have the right to vote or to control the outcome of any decisions, but will participate in advising management and the board in all aspects of a business combination: Our advisory director, Cassio Calil, has over 35 years of experience in finance. Mr. Calil has served as Managing Partner at Leste Kapital Solutions since April 2021 and he also currently serves as Senior Corporate Advisor of COPAP Corp. He was also the Founder and Chief Executive Officer of Kapital Advisors LLC. Prior to that, Mr. Calil was Managing Partner of TEM Healthcare Services from 2019 to 2020 and from 2016 to 2019, he was the Global Head of Financial Services for Brightstar Corporation, a SoftBank company. Prior to Brightstar Corporation, Mr. Calil held various roles at J.P. Morgan including Head of International Corporate Client Banking of J.P. Morgan s Commercial Bank, President of Asset Management in Brazil, Head of Corporate Solutions, and Co-Head of Structured Products. Prior to joining J.P. Morgan, Mr. Calil started his career with IBM Corporation ( IBM ) in Hong Kong and worked for IBM for 17 years, holding various positions within the Finance and M&A organization in various locations around the world. In 1999, he became Assistant Treasurer in Armonk, New York. He was responsible for IBM s capital structure and capital planning, as well as the company s share repurchase program, M&A and global capital markets activities, and enterprise financial risk management. Mr. Calil holds a Bachelor s degree in Economics from Mackenzie University and a Master s degree in Economics from Macquarie University. Our advisory director, John Humphreys, has over 28 years of experience as an investment banking executive. Mr. Humphreys has advised on many capital raising and financial advisory transactions globally throughout his career. He is currently Managing Partner of Joro Capital Partners, an independent financial advisory and consulting firm, and a Partner in H&H Capital Management, a provider of financial solutions to homebuilders. From 2013 to December 2019, Mr. Humphreys was with Mizuho Group. While at Mizuho, his roles included Vice Chairman U.S. Banking, Head of U.S. Investment Banking and Co-Head of U.S. Client Coverage. Prior to Mizuho, Mr. Humphreys spent 20 years at Bank of America Merrill Lynch, of which 18 years were in London s Technology, Healthcare, and Consumer investment banking teams, as well as leadership roles across the U.K. Corporate & Investment Banking teams. While in TMT in the early part of his career, Mr. Humphreys worked on a range of telecommunication infrastructure transactions including NTL, Cable & Wireless, Inmarsat and KPNQuest. Mr. Humphreys began his career at Bank of America in Latin American corporate finance. He earned a Bachelor s degree in Economics from the University of Chicago. Our advisory director, Wissam Otaky, has over 23 years of experience in investing, executive and operating roles. Mr. Otaky is currently a Managing Director at Leste Holding where he is responsible for Leste s new initiatives. Mr. Otaky also sits on Leste s executive committee. Prior to joining Leste, Mr. Otaky was a Co-Managing Partner of Hatcher Plus, a Singapore-based venture investor focused on scale in early-stage technology investing. Earlier in his career, he helped lead MarkVIP in the Middle East and North Africa region, and held a variety of positions focused on business development at Dubai Contracting Company where he led M&A activity, corporate development and growth functions. Mr. Otaky earned first class honors in a Bachelor of Commerce degree from McGill University with a double major in Finance and Economics and a minor in Statistics, and is also a CFA Charterholder. We expect that our deal sourcing and transaction execution capabilities will be further augmented by our advisory relationship with Leste Group. Founded in 2014, Leste Group is a global independent alternative investment manager with roots in Latin America. Leste Group s investment teams leverage institutional-grade processes, an entrepreneurial approach, capital markets expertise and networks to identify investment opportunities. We further believe Leste Group, with its experience in evaluating and participating in initial public offerings, will enhance our ability to assess the viability of opportunities. Headquartered in Miami, Florida, Leste Group also has offices in New York, Rio de Janeiro, Sao Paulo and London. Leste Group has agreed to provide consulting and advisory services to our board of directors from time to time and on terms to be agreed between the parties. 5 Table of Contents The Global TMT Opportunity While we may acquire a business in any industry, we intend to focus our search on the global TMT sector. We believe that the TMT sector enjoys outsized growth driven by technology advancements, the ever-increasing demand for data (both streaming video and information), partially driven by COVID-19, the need for more coverage, capacity and speed of networks and evolving business models. In addition, we believe our team is well positioned to evaluate these global opportunities and assist the target management teams as they grow their business and navigate a variety of secular trends described herein. According to Mergermarket, from 2015 to 2020, the global TMT sector experienced approximately $4.1 trillion of M&A deal volume, the largest of all sectors, comprising 20% of global M&A transactions. We believe each of the sectors within TMT offer significant growth. Below we outline the anticipated drivers of this growth: Telecommunications: We believe the ongoing global digital transformation, accelerated partially by the onset of COVID-19, has created an opportunity in the telecommunication sector based on the need for greater coverage, capacity and speed. The emergence of tele-health, tele-education and the globalization of work forces is driving increased demand for high speed communications, as well as creating an urgency in markets around the world to develop the necessary infrastructure to meet this demand. The pandemic has highlighted how much of the globe is under served by telecommunications infrastructure and that much of the existing coverage is lacking the capacity and the speed to meet customers ever-increasing need to utilize new technologies and demand for better performance. The inherent limitations of the existing infrastructure warrant the need for additional investment in fiber, data centers, mobile, broadband, towers and spectrum. We believe these infrastructure holes are magnified in rural America as well as areas outside of the United States, due to the aging infrastructure or lack of investment currently in place. We believe this large global opportunity pool is poised for investment at scale for upgrades and continued buildout in historically underserved areas. Broadband is an area we expect will expand as mobile wireless and fixed wireless services, backhauled by fiber, grow in response to these ever-increasing needs for coverage, capacity and speed. An example of the increasing demand for coverage, capacity and speed is regenerative agriculture, which needs precision in order to fulfill current carbon reduction initiatives. Our expectation is that global requirements for robust communication infrastructure will foster opportunities to unlock value vis-a-vis cost savings, new avenues of revenue streams, more smart products, and better customer engagement & experiences. Media: Based on new fiber deployments and 5G wireless capabilities, as well as shifting dynamics in a post-pandemic environment, we believe the media sector is positioned to benefit from changes in the way content is consumed, produced and disseminated. For instance, we believe these shifts in coverage, capacity and speed will benefit areas including, but not limited to, content creation, streaming, cloud gaming, eSports, augmented reality and virtual reality. Furthermore, we believe the continued buildout of global communications infrastructure (e.g. broadband, fiber, 5G, etc.) will expand the target market for these services. For example, the rollout of 5G will bolster rural area broadband connections and, in turn, media consumption. Technology: We believe growth in technology is driven by innovation, which is supported by significant and constant R&D investment across various subsector verticals, including: semiconductors, software, networking (e.g. IoT), Internet and hardware (as well as the products and services related to each of those sectors). We believe ongoing advancements in technology will continue to usher in a new wave of market entrants and disrupt incumbents across the TMT sector. We also expect enhanced communications infrastructure, including the adoption of 5G, to be a catalyst shaping the future areas of technology investment. For example, increasingly, organizations require instant access to data and related analytics to make real time decisions. We believe that in areas such as telehealth, e-learning, network functions virtualization, software defined networks, cybersecurity, artificial intelligence, machine learning, autonomous driving, payments, banking and neobanks, instantaneous access to data and its application to decision making has become critical. As technical capabilities and use cases expand, we believe the need for continued investment will grow, thereby creating new companies and opportunities. 6 Table of Contents Competitive Differentiation We believe that our team s experience in the businesses that fall within the global TMT sector will prove to be a competitive advantage. This experience will enable us to identify an attractive business combination candidate that will benefit from being a publicly traded company. Additionally, we believe we will be a preferred partner for growing businesses in this area for the following reasons: Deep TMT sector knowledge. The complexity of the businesses that fall within the TMT sector requires in-depth understanding of technological trends, industry structure and relationships, regulatory and technical standards. Our management team, board of directors and advisory directors offer a blend of experience in investing, operations and capital markets. As a veteran of the TMT sector, our Vice Chairman and Chief Executive Officer, Joseph Euteneuer, is well positioned to evaluate targets and select an attractive business combination candidate. Our director nominee, Ron LeMay, also has extensive experience and relationships in the TMT sector garnered through multiple decades of executive experience and serial entrepreneurship, further supporting our capability to source and evaluate opportunities. The experience of our management team, board of directors and advisory board includes not only careers in various roles at industry leaders, but assisting organizations in an advisory capacity as well. These companies include, but are not limited to, AT&T, Comcast Corporation, Softbank, Intel, Lumen, Viacom, CBS, Mattel, GoGo Inflight Internet Services, Japan Telecom, Qwest Communications International, Rivada Networks Inc., Sprint, XM Satellite Radio Inc., Bank of America, Blackstone, Carlyle Group, Citigroup, Credit Suisse, Goldman Sachs, J.P. Morgan, KKR, Lazard, Mizuho and Wells Fargo Securities. Access to operating partners and funding sources. Over the course of their careers, the members of our management team have developed a broad network of contacts and corporate relationships in the TMT sector, both in the U.S. and internationally as enumerated above. In addition, our team s experience includes careers in various leadership roles at companies around the world, building not only financial and industry experience but deep networks of industry relationships. We believe this network of contacts will enable us to quickly generate a pipeline of unique, attractive TMT acquisition targets and help the ultimate target grow its business. Capital markets and capital allocation experience. We believe that we will benefit due to our team s extensive capital markets and capital allocation experience, both from the operating and banking side of a transaction. Our President, Chief Investment Officer and Director, Alan B. Mitchell and Chief Financial Officer, Jonathan Morris, along with our director and advisory director nominees Eric Medow, Ron LeMay, Alastair John Mackenzie Walton and Constantino de Oliveira Junior have extensive experience not only in the TMT sector but also with initial public offerings, having taken several companies public throughout their careers. In addition, some of the members of our team possess prior investment banking experience, supporting organizations through capital raising and strategic advisory activities. This experience will allow for additional support to the target business, not only with regard to navigating the business combination but also capital raising and capital allocation activities thereafter. International transaction experience. Our management team, board of directors and advisory directors have in-depth transaction experience both domestically and internationally. Our team brings with it investing and private equity experience, including in Europe, Australasia and Latin America, through our partnership with Leste Group. We believe that many attractive TMT investment opportunities exist outside of the U.S., and our team has the relevant international experience to enable us to identify and evaluate non-U.S. targets in Western, Eastern and Central Europe, Latin America, the Middle East and Australasia. We believe our team s experience will also be helpful and attractive to potential targets. Previous SPAC experience. We believe that potential sellers of target businesses will view the fact that certain members of our management team have previously successfully closed an initial business combination with a blank check company and have completed an initial public offering of an additional special purpose acquisition company ( SPAC ) as positive factors in considering an initial business combination with us. 7 Table of Contents Acquisition Criteria We will seek targets that represent an attractive investment opportunity and that can benefit from the operational, technological and investment expertise of our management, board of directors and advisory directors. Consistent with our business strategy, we have identified the following general criteria for evaluating and selecting prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter our initial business combination with a target business that does not meet these criteria. We intend to focus our search for a business combination target in the global TMT sector. We intend to acquire one or more businesses that we believe, based on our due diligence and analysis, have: Total equity valuation of between $700 million and $5 billion; compelling reasons to be publicly listed in the U.S. and internal systems in place to be a publicly listed company; defensible market position, with demonstrated competitive advantages to maintain barriers to entry; considerable revenue growth potential; potential to generate sustainable free cash flow; strong management team with a public company track record or with a strong potential to gain confidence of U.S. institutional investors; and the potential to create considerable value for our stockholders. We will also consider fundamentally sound companies that may currently be underperforming in comparison to their potential or that face issues that can be resolved as part of a business combination with our SPAC. We believe our management team s operating and transaction experience and relationships with potential sellers will provide us with a substantial number of potential business combination targets. In addition to any targets we may identify on our own, we believe that other business combination candidates will be brought to our attention from various unaffiliated sources, including private equity and venture capital funds, investment banks and other advisors or industry experts. Initial Business Combination Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if, for instance, it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. Further, pursuant to our amended and restated bylaws, any initial business combination requires the unanimous approval of the members of our board of directors who are present and entitled to vote on such initial business combination. We anticipate structuring our initial business combination either (i) in such a way so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses, or (ii) in such a way so that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business if this is necessary or advisable in order to meet certain 8 Table of Contents objectives of the target management team or stockholders, or for other reasons. However, we will only complete an initial business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of Nasdaq s 80% fair market value test. If the initial business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. Members of our management team and our directors may directly or indirectly own our founder shares and/or placement units following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. In particular, because the founder shares were purchased at approximately $0.004 per share (after giving effect to the surrender of founder shares described herein), the holders of our founder shares (including members of our management team that directly or indirectly own founder shares) could make a substantial profit after our initial business combination even if our public stockholders lose money on their investment as a result of a decrease in the post-combination value of their Class A common stock (after accounting for any adjustments in connection with an exchange or other transaction contemplated by the business combination). Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors were to be included by a target business as a condition to any agreement with respect to our initial business combination. Our Business Combination Process In evaluating prospective business combinations, we expect to conduct a thorough due diligence review process that will encompass, among other things, a review of historical and projected financial and operating data, meetings with management and their advisors (if applicable), on-site inspection of facilities and assets, discussion with customers and suppliers, legal reviews and other reviews as we deem appropriate. We will also seek to utilize the expertise of our management team in analyzing operating companies, evaluating the investment potential of their business models, assessing the feasibility of their financial projections and determining the appropriate return expectations given the risk profile of the target business. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions that our initial business combination is fair to our company from a financial point of view. Certain of our officers and directors presently have fiduciary or contractual obligations to other entities, including Twelve Seas II, pursuant to which such officer or director is or will be required to present a business combination opportunity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations to present the opportunity to such entity, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such entity. We believe, however, that the fiduciary duties or contractual obligations of our officers or directors will not materially affect our ability to complete our initial business combination. Our 9 Table of Contents amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation. In addition, our sponsor, officers and directors may participate in the formation of, or become an officer or director of, any other blank check company prior to completion of our initial business combination. As a result, our sponsor, officers or directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. Although we have no formal policy in place for vetting potential conflicts of interest, our board of directors will review any potential conflicts of interest on a case-by-case basis. In particular, affiliates of our sponsor are currently sponsoring one other blank check company, Twelve Seas II. Twelve Seas II is focusing on companies located outside the United States or located in the United States but which are owned by non-U.S. stockholders, but may seek to complete a business combination in any location. Further, Mr. Richardson, our Chairman, serves as Chairman of Twelve Seas II, Mr. Elkin, our Chief Operating Officer, serves as the Chief Executive Officer and a director of Twelve Seas II, and Mr. Morris, our Chief Financial Officer, serves as the Chief Financial Officer and a director of Twelve Seas II. Any such companies, including Twelve Seas II, may present additional conflicts of interest in pursuing an acquisition target. However, we do not believe that any potential conflicts with Twelve Seas II would materially affect our ability to identify and pursue initial business combination opportunities or complete our initial business combination, because (i) our management team has significant experience in identifying and executing multiple acquisition opportunities simultaneously, (ii) Mr. Euteneuer and Mr. Mitchell, who are not officers of Twelve Seas II, will lead our search for a business combination target, (iii) Messrs. Junior, LeMay, Medow and Walton, four of the directors that will be on our board, are not directors of or otherwise affiliated with Twelve Seas II and (iv) although we are focused on the TMT sector, we are not limited by industry or geography in terms of the acquisition opportunities we can pursue. In addition, we have a committee consisting of Messrs. Richardson, Euteneuer and Humphreys to allocate targets between us and other blank check companies that our management and directors participate in. Mr. Richardson has the deciding vote on such allocation if there is a disagreement within the committee. Corporate Information Our executive offices are located at 1450 Brickell Avenue, Suite 2600, Miami, Florida 33131, and our telephone number is (305) 929-9200. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A common stock that is held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year 10 Table of Contents period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our Class A common stock held by non-affiliates exceeds $250 million as of the end of the prior June 30, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our Class A common stock held by non-affiliates exceeds $700 million as of the prior June 30. 11 Table of Contents THE OFFERING In deciding whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section of this prospectus entitled Risk Factors. Securities offered 20,000,000 units (or 23,000,000 units if the underwriters over-allotment option is exercised in full), at $10.00 per unit, each unit consisting of: one share of Class A common stock; and three-fourths of one redeemable warrant. Proposed Nasdaq symbols Units: TSIVU Class A Common Stock: TSIV Warrants: TSIVW Trading commencement and separation of Class A common stock and warrants The units will begin trading on or promptly after the date of this prospectus. We expect the Class A common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Mizuho Securities USA LLC informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the shares of Class A common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of Class A common stock and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. If, upon separation of the units, a holder of warrants would be entitled to receive a fractional warrant, we will round down the number of warrants to be issued to such holder to the nearest whole number of warrants. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Separate trading of the Class A common stock and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A common stock and warrants be traded separately until we have filed a Current Report on Form 8-K with the U.S. Securities and Exchange Commission ( SEC ) containing an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which is anticipated to take place three business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. 12 Table of Contents Units: Number outstanding before this offering and the private placement 0 Number of placement units to be sold in a private placement simultaneously with this offering 1,240,000(1) Number outstanding after this offering and the private placement 21,240,000(1) Common stock: Number outstanding before this offering and the private placement 5,750,000 shares of Class B common stock(2) Number outstanding after this offering and the private placement 27,065,000 shares of Class A common stock and Class B common stock(1)(3) Warrants: Number outstanding before this offering and the private placement 0 Number of warrants to be outstanding after this offering and the private placement 15,930,000(1)(4) Exercisability Each whole warrant is exercisable to purchase one share of our Class A common stock, subject to adjustment as provided herein. No fractional warrants will be issued upon separation of the units and only whole warrants will trade and are exercisable. We structured each unit to contain three-fourths of one redeemable warrant, with each whole warrant exercisable for one share of Class A common stock, as compared to units issued by some other similar SPACs which contain whole warrants exercisable for one whole share, in order to reduce the dilutive effect of the warrants upon completion of an initial business combination as compared to units that each contain a whole warrant to purchase one whole share, thus making us, we believe, a more attractive initial business combination partner for target businesses. ____________ (1) Assumes no exercise of the underwriters over-allotment option and, as applicable, the forfeiture by our sponsor of 750,000 founder shares. Our sponsor has agreed to purchase an aggregate of 1,040,000 placement units (or 1,130,000 placement units if the over-allotment option is exercised in full) and the representative has agreed to purchase an aggregate of 200,000 placement units (or 230,000 placement units if the over-allotment option is exercised in full), at a price of $10.00 per unit, for an aggregate purchase price of $12,400,000 (or $13,600,000 if the over-allotment option is exercised in full). Each placement unit will be identical to the units sold in this offering, except as described in this prospectus. The placement units are not subject to forfeiture but will be subject to transfer restrictions as described in Principal Stockholders Restrictions on Transfers of Founder Shares, Placement Units and Representative Shares. (2) Includes up to 750,000 shares that are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised. (3) Comprised of 22,065,000 shares of Class A common stock (including 20,000,000 public shares, 1,240,000 placement shares and 825,000 representative shares) and 5,000,000 shares of Class B common stock (or founder shares). The Class B common stock is convertible into shares of our Class A common stock on a one-for-one basis, subject to adjustment as described below adjacent to the caption Founder shares conversion and anti-dilution rights. (4) Comprised of 15,000,000 public warrants and 930,000 placement warrants. 13 Table of Contents Exercise price $11.50 per share, subject to adjustment as described herein. In addition, if (x) we issue additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or such affiliates, as applicable, prior to such issuance) (the Newly Issued Price ), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our Class A common stock during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the Market Value ) is below $9.20 per share, then the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the greater of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price described below under Redemption of warrants will be adjusted (to the nearest cent) to be equal to 180% of the greater of the Market Value and the Newly Issued Price. Exercise period The warrants will become exercisable 30 days after the completion of our initial business combination, provided that we have an effective registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise of the warrants and a current prospectus relating to them is available (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). We have agreed that as soon as practicable, but in no event later than 15 business days after the closing of our initial business combination, we will use our best efforts to file with the SEC a post-effective amendment to the registration statement of which this prospectus forms a part or a new registration statement covering the shares of Class A common stock issuable upon exercise of the warrants, to cause such registration statement to become effective within 60 business days following our initial business combination and to maintain a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed, as specified in the warrant agreement. If a registration statement covering the shares of Class A common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption. If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a cashless basis. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation; provided, however, 14 Table of Contents that the placement warrants issued to the representative will not be exercisable more than five years after the effective date of the registration statement of which this prospectus forms a part in accordance with FINRA Rule 5110(g)(8)(A). On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption of warrants Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the placement warrants): in whole and not in part; at a price of $0.01 per warrant; upon not less than 30 days prior written notice of redemption given after the warrants become exercisable (the 30-day redemption period ) to each warrant holder; and if, and only if, the reported last sale price of the Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period commencing once the warrants become exercisable and ending three business days before we send the notice of redemption to the warrant holders. If the foregoing conditions are satisfied and we issue a notice of redemption, each warrant holder can exercise his, her or its warrant prior to the scheduled redemption date. However, the price of the shares of Class A common stock may fall below the $18.00 trigger price as well as the $11.50 warrant exercise price after the redemption notice is issued. If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In determining whether to require all holders to exercise their warrants on a cashless basis, our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our stockholders of issuing the maximum number of shares of Class A common stock issuable upon the exercise of our warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value for this purpose shall mean the average reported last sale price of the Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Please see the section of this prospectus entitled Description of Securities Redeemable Warrants Public Stockholders Warrants for additional information. None of the placement warrants will be redeemable by us. 15 Table of Contents Founder shares In April 2021, our sponsor purchased 8,625,000 founder shares for an aggregate purchase price of $25,000. In September 2021, our sponsor surrendered 2,875,000 founder shares to us for no consideration resulting in an aggregate of 5,750,000 founder shares outstanding and a purchase price of $0.004 per share (up to 750,000 founder shares are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised). Prior to the initial investment in the company of $25,000 by our sponsor, the company had no assets, tangible or intangible. The per share purchase price of the founder shares was determined by dividing the amount of cash contributed to the company by the aggregate number of founder shares issued (after giving effect to the surrender of founder shares described above). In December 2021, our sponsor transferred 50,000 founder shares to each of our independent directors at their original purchase price. The number of founder shares issued was determined based on the expectation that the founder shares would represent 20% of the outstanding shares after this offering (excluding the placement units and underlying securities and the representative shares). As such, our initial stockholders will collectively own approximately 22.3% of our issued and outstanding shares after this offering (including the placement shares to be issued to the sponsor and assuming they do not purchase any units in this offering). In addition, our sponsor has agreed to make available interests in the sponsor equivalent to up to 500,000 of its founder shares as incentive compensation to any of our directors and officers, our board advisors, any representative of Leste Group or any designated third party that is responsible for sourcing an acquisition target for our initial business combination. Neither our sponsor nor any of our officers or directors have expressed an intention to purchase any units in this offering. Up to 750,000 founder shares will be subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised so that our initial stockholders will maintain ownership of 20% of our common stock after this offering (excluding the placement units and underlying securities and the representative shares). We will effect a stock dividend or share contribution prior to this offering should the size of the offering change, in order to maintain such ownership percentage. The founder shares are identical to the shares of Class A common stock included in the units being sold in this offering, except that: the founder shares are shares of Class B common stock that automatically convert into shares of our Class A common stock at the time of the consummation of our initial business combination, on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described herein; the founder shares are subject to certain transfer restrictions, as described in more detail below; our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to (i) waive their redemption rights with respect to any founder shares, placement shares and public shares held by them in connection with the completion of our initial business combination, (ii) waive their redemption rights with respect to any founder shares, placement shares and public shares held by them in connection with a stockholder 16 Table of Contents vote to approve an amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain amendments to our charter prior thereto or to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering (or up to 24 months, if we extend the time to complete a business combination as described in this prospectus) or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity and (iii) waive their rights to liquidating distributions from the trust account with respect to any founder shares and placement shares held by them if we fail to complete our initial business combination within 18 months from the closing of this offering (or up to 24 months, if we extend the time to complete a business combination as described in this prospectus), although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame. pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote any founder shares and placement shares held by them and any public shares they may acquire during or after this offering (including in open market and privately negotiated transactions) in favor of our initial business combination. In addition, pursuant to the underwriting agreement, the representative of the underwriters has agreed to vote any representative shares in favor of our initial business combination. If we submit our initial business combination to our public stockholders for a vote, we will complete our initial business combination only if a majority of the then outstanding shares of common stock present and entitled to vote at the meeting to approve the initial business combination are voted in favor of the initial business combination. As a result, in addition to our initial stockholders founder shares, the placement shares and the representative shares, we would need only 6,467,501, or 32.3% (assuming all issued and outstanding shares are voted and the over-allotment option is not exercised), or none (assuming only the minimum number of shares representing a quorum are voted and the over-allotment option is not exercised), of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved; and the founder shares are entitled to registration rights. Transfer restrictions on founder shares Our initial stockholders have agreed not to transfer, assign or sell any of their founder shares until the earlier to occur of: (A) one year after the completion of our initial business combination and (B) subsequent to our initial business combination, (x) if the reported last sale price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at 17 Table of Contents least 150 days after our initial business combination, or (y) the date on which we complete a liquidation, merger, capital stock exchange or other similar transaction that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property (except as described herein under the section of this prospectus entitled Principal Stockholders Restrictions on Transfers of Founder Shares, Placement Units and Representative Shares ). Any permitted transferees will be subject to the same restrictions and other agreements of our initial stockholders with respect to any founder shares. We refer to such transfer restrictions throughout this prospectus as the lock-up. Founder shares conversion and anti-dilution rights The shares of Class B common stock will automatically convert into shares of our Class A common stock at the time of the consummation of our initial business combination on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in this prospectus and related to the closing of the initial business combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of this offering (excluding the placement units and underlying securities and the representative shares) plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with the initial business combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in the initial business combination or any private placement-equivalent units and their underlying securities issued to our sponsor or its affiliates upon conversion of working capital or extension loans made to us). The term equity-linked securities refers to any debt or equity securities that are convertible, exercisable or exchangeable for shares of Class A common stock issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt. Securities could be deemed issued for purposes of the conversion rate adjustment if such shares are issuable upon the conversion or exercise of convertible securities, warrants or similar securities. Representatives shares Upon consummation of this offering, the representative of the underwriters shall be issued 825,000 shares of Class A common stock (or 915,000 if the underwriters over-allotment option is exercised in full). Pursuant to the underwriting agreement, the representative of the underwriters has agreed: to (i) waive its redemption rights with respect to any representative shares in connection with the completion of our initial business combination, (ii) waive its redemption rights with respect to any representative shares in connection 18 Table of Contents with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain amendments to our charter prior thereto or to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing (or up to 24 months, if we extend the time to complete a business combination as described in this prospectus) of this offering or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity and (iii) waive its rights to liquidating distributions from the trust account with respect to any representative shares if we fail to complete our initial business combination within 18 months from the closing of this offering (or up to 24 months, if we extend the time to complete a business combination as described in this prospectus), although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame; to vote any representative shares in favor of our initial business combination; and not to transfer, assign or sell any of its representative shares until the earlier to occur of: (A) one year after the completion of our initial business combination and (B) subsequent to our initial business combination, (x) if the reported last sale price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, or (y) the date on which we complete a liquidation, merger, capital stock exchange or other similar transaction that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property (except as described herein under the section of this prospectus entitled Underwriting ). Any permitted transferees will be subject to the same restrictions and other agreements of the representative with respect to any representative shares. We refer to such transfer restrictions throughout this prospectus as the lock-up. Voting rights Holders of record of the Class A common stock and holders of record of the Class B common stock will vote together as a single class on all matters submitted to a vote of our stockholders, with each share of common stock entitling the holder to one vote, except as required by law. 19 Table of Contents Placement units Our sponsor has agreed to purchase an aggregate of 1,040,000 placement units (or 1,130,000 placement units if the over-allotment option is exercised in full) and the representative has agreed to purchase an aggregate of 200,000 placement units (or 230,000 placement units if the over-allotment option is exercised in full), at a price of $10.00 per unit, for an aggregate purchase price of $12,400,000 (or $13,600,000 if the over-allotment option is exercised in full). Each placement unit is identical to the units offered by this prospectus except as described below. There will be no redemption rights or liquidating distributions from the trust account with respect to the founder shares, placement shares, placement warrants or representative shares, which will expire worthless if we do not consummate a business combination within 18 months from the closing of this offering (or up to 24 months, if we extend the time to complete a business combination as described in this prospectus). Our initial stockholders and the representative have agreed to waive their redemption rights with respect to any founder shares, placement shares and representative shares (i) in connection with the consummation of a business combination, (ii) in connection with a stockholder vote to amend our amended and restated certificate of incorporation to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain amendments to our charter prior thereto, to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the completion of this offering (or up to 24 months, if we extend the time to complete a business combination as described in this prospectus) or with respect to any other provision relating to stockholders rights or pre-initial business combination activity and (iii) if we fail to consummate a business combination within 18 months from the completion of this offering (or up to 24 months, if we extend the time to complete a business combination as described in this prospectus) or if we liquidate prior to the expiration of the 18-month period (or up to 24-month period, if we extend the time to complete a business combination as described in this prospectus). If we submit our initial business combination to our public stockholders for a vote, our sponsor, officers and directors and representative of the underwriters have agreed pursuant to the letter agreement (and, in the case of the representative, pursuant to the underwriting agreement) to vote any founder shares, placement shares and representative shares held by them and, in the case of our sponsor, officers and directors, any public shares purchased during or after this offering (including in open market and privately negotiated transactions) in favor of our initial business combination. However, our initial stockholders and the representative will be entitled to redemption rights with respect to any public shares held by them if we fail to consummate a business combination or liquidate within the 18-month period (or up to 24-month period, if we extend the time to complete a business combination as described in this prospectus). In addition, the placement warrants issued to the representative may not be exercised after five years from the effective date of the registration statement of which this prospectus forms a part in accordance with FINRA Rule 5110(g)(8)(A). 20 Table of Contents Transfer restrictions on placement units The placement units and their component securities will not be transferable, assignable or salable until 30 days after the consummation of our initial business combination except to permitted transferees. Redeemability and exercise of placement warrants The placement warrants will be non-redeemable and exercisable on a cashless basis. If holders of placement warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering their warrants for that number of shares of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value for this purpose shall mean the average reported last sale price of the Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent. The reason that we have agreed that these warrants will be exercisable on a cashless basis is because it is not known at this time whether they will be affiliated with us following an initial business combination. If they remain affiliated with us, their ability to sell our securities in the open market will be significantly limited. We expect to have policies in place that prohibit insiders from selling our securities except during specific periods of time. Even during such periods of time when insiders and the representative will be permitted to sell our securities, an insider cannot trade in our securities if he or she is in possession of material non-public information. Accordingly, unlike public stockholders who could sell the shares of Class A common stock issuable upon exercise of the warrants freely in the open market, the insiders could be significantly restricted from doing so. As a result, we believe that allowing the holders to exercise such warrants on a cashless basis is appropriate. Proceeds to be held in trust account Nasdaq rules provide that at least 90% of the gross proceeds from this offering and the sale of the placement units be deposited in a trust account. Of the net proceeds of this offering and the sale of the placement units, $204,000,000, or $10.20 per unit ($234,600,000, or $10.20 per unit, if the underwriters over-allotment option is exercised in full) will be placed into a trust account in the United States with Continental Stock Transfer & Trust Company acting as trustee. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our tax obligations and up to $100,000 of interest that may be used for our dissolution expenses, the proceeds from this offering and the sale of the placement units held in the trust account will not be released from the trust account until the earliest to occur of: (a) the completion of our initial business combination, (b) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain amendments to our charter prior thereto or to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering (or up to 24 months, if we extend the time to complete a business combination as described in this prospectus) or 21 Table of Contents (ii) with respect to any other provision relating to stockholders rights or pre-business combination activity, and (c) the redemption of our public shares if we are unable to complete our initial business combination within 18 months from the closing of this offering (or up to 24 months, if we extend the time to complete a business combination as described in this prospectus), subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. In addition, if we extend the time available for us to consummate our initial business combination, we, upon five days advance notice prior to the applicable deadline, must deposit into the trust account for each three month extension (of which there may be no more than two such extensions) $2,000,000, or $2,300,000 if the underwriters over-allotment option is exercised in full, adjusted proportionately in the case of a partial exercise ($0.10 per share in either case), on or prior to the date of the applicable deadline. See The Offering Redemption of public shares and distribution and liquidation if no initial business combination for a description of how we may extend the time available for us to consummate our initial business combination. Anticipated expenses and funding sources Except as described above with respect to the payment of taxes, unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. The proceeds held in the trust account will be invested only in U.S. government securities with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. We will disclose in each quarterly and annual report filed with the SEC prior to our initial business combination whether the proceeds deposited in the trust account are invested in U.S. government treasury obligations or money market funds or a combination thereof. Based upon current interest rates, we expect the trust account to generate approximately $408,000 of pre-tax interest annually assuming an interest rate of 0.20% per year; however, we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the placement units not held in the trust account, which will be approximately $3,400,000 in working capital after the payment of approximately $1,000,000 in expenses relating to this offering; and any loans or additional investments from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation to advance funds or invest in us, and provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of an initial business combination. 22 Table of Contents Conditions to completing our initial business combination Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination target, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination target, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. There is no limitation on our ability to raise funds privately, or through loans in connection with our initial business combination. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination either (i) in such a way so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses, or (ii) in such a way so that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders, or for other reasons. However, we will only complete an initial business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of Nasdaq s 80% fair market value test. If the initial business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. 23 Table of Contents Permitted purchases of public shares and public warrants by our affiliates If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, initial stockholders, directors, officers, advisors or their affiliates may purchase public shares or public warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. There is no limit on the number of shares or warrants our sponsor, initial stockholders, directors, officers, advisors or their affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. However, apart from the purchase of the placement units, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. We expect that any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. None of the funds held in the trust account will be used to purchase shares or public warrants in such transactions prior to completion of our initial business combination. See Proposed Business Permitted Purchases of Our Securities for a description of how our sponsor, initial stockholders, directors, officers or any of their affiliates will select which stockholders to purchase securities from in any private transaction. The purpose of any such purchases of shares could be to vote such shares in favor of the initial business combination and thereby increase the likelihood of obtaining stockholder approval of the initial business combination or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our shares of Class A common stock or warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. 24 Table of Contents Redemption rights for public stockholders upon completion of our initial business combination We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.20 per public share, which amount may be increased by up to $0.20 per unit sold in this offering in the event we decide to extend the time to consummate our business combination by up to six months (as described in this prospectus). However, there is no guarantee that investors will receive $10.20 per share upon redemption (or up to $10.40 per share in the event we decide to extend the time to consummate our business combination by up to six months, as described in this prospectus). There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and placement shares held by them and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination or otherwise. Manner of conducting redemptions We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a stockholder meeting called to approve the initial business combination or (ii) by means of a tender offer. The decision as to whether we will seek stockholder approval of a proposed initial business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval under applicable law or stock exchange listing requirements. Under Nasdaq rules, asset acquisitions and stock purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding common stock or seek to amend our amended and restated certificate of incorporation would typically require stockholder approval. We may conduct redemptions without a stockholder vote pursuant to the tender offer rules of the SEC unless stockholder approval is required by law or stock exchange listing requirements or we choose to seek stockholder approval for business or other legal reasons. So long as we obtain and maintain a listing for our securities on Nasdaq, we will be required to comply with Nasdaq s stockholder approval rules. 25 Table of Contents If stockholder approval of the transaction is required by law or stock exchange listing requirements, or we decide to obtain stockholder approval for business or other legal reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and file proxy materials with the SEC. If we seek stockholder approval, we will complete our initial business combination only if a majority of the then outstanding shares of common stock present and entitled to vote at the meeting to approve the initial business combination are voted in favor of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the Company representing a majority of the voting power of all outstanding shares of capital stock of the Company entitled to vote at such meeting. Our initial stockholders will count towards this quorum and, pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote any founder shares and placement shares held by them and any public shares acquired by them during or after this offering (including in open market and privately negotiated transactions) in favor of our initial business combination. In addition, pursuant to the underwriting agreement, the representative of the underwriters has agreed to vote any representative shares in favor of our initial business combination. For purposes of seeking approval of the majority of our outstanding shares of common stock voted, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. As a result, in addition to our initial stockholders founder shares, the placement shares and the representative shares, we would need only 6,467,501, or 32.3% (assuming all issued and outstanding shares are voted and the over-allotment option is not exercised), or none (assuming only the minimum number of shares representing a quorum are voted and the over-allotment option is not exercised), of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved. We intend to give approximately 30 days (but not less than 10 days nor more than 60 days) prior written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination. These quorum and voting thresholds, and the voting agreements of our initial stockholders, may make it more likely that we will consummate our initial business combination. Each public stockholder may elect to redeem its public shares irrespective of whether they vote for or against the proposed transaction. 26 Table of Contents If a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other legal reasons, we will, pursuant to our amended and restated certificate of incorporation: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Such provisions may be amended if approved by holders of at least 65% of our common stock entitled to vote thereon. Whether or not we maintain our registration under the Exchange Act or our listing on Nasdaq, we will provide our public stockholders with the opportunity to redeem their public shares by one of the two methods listed above. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase shares of our Class A common stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. Furthermore, in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 as described above immediately prior to or upon consummation of our initial business combination (so that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement that may be contained in the agreement relating to our initial business combination. Consequently, if accepting all properly submitted redemption requests would cause our net tangible assets to be less than $5,000,001 or make us unable to satisfy a minimum cash condition as described above, we would not proceed with such redemption and the related business combination and may instead search for an alternate business combination. If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination. 27 Table of Contents We may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to either tender their certificates to our transfer agent prior to the date set forth in the tender offer documents mailed to such holders, or up to two business days prior to the vote on the proposal to approve the initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically. We believe that this will allow our transfer agent to efficiently process any redemptions without the need for further communication or action from the redeeming public stockholders, which could delay redemptions and result in additional administrative cost. If the proposed initial business combination is not approved and we continue to search for a target company, we will promptly return any certificates delivered, or shares tendered electronically, by public stockholders who elected to redeem their shares. Our amended and restated certificate of incorporation will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001. In addition, our proposed initial business combination may impose a minimum cash requirement for: (i) cash consideration to be paid to the target or its owners, (ii) cash for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions. In the event the aggregate cash consideration we would be required to pay for all shares of Class A common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will not complete the initial business combination or redeem any shares in connection with such initial business combination, and all shares of Class A common stock submitted for redemption will be returned to the holders thereof. We may, however, raise funds through the issuance of equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements or backstop arrangements we may enter into following consummation of this offering, in order to, among other reasons, satisfy such net tangible assets or minimum cash requirements. Limitation on redemption rights of stockholders holding 15% or more of the shares sold in this offering if we hold stockholder vote Notwithstanding the foregoing redemption rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. We believe the restriction described above will discourage stockholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to 28 Table of Contents redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with an initial business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders ability to vote all of their shares (including all shares held by those stockholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Redemption rights in connection with proposed amendments to our certificate of incorporation Our amended and restated certificate of incorporation will provide that any of its provisions related to pre-initial business combination activity (including the requirement to deposit proceeds of this offering and the private placement of units into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein) may be amended if approved by holders of at least 65% of our common stock entitled to vote thereon, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of at least 65% of our common stock entitled to vote thereon. In all other instances, our amended and restated certificate of incorporation may be amended by holders of a majority of our outstanding common stock entitled to vote thereon, subject to applicable provisions of the Delaware General Corporation Law ( DGCL ), or applicable stock exchange rules. Under our amended and restated certificate of incorporation, we may not issue additional securities that can vote on amendments to our amended and restated certificate of incorporation or on our initial business combination or that would entitle holders thereof to receive funds from the trust account. Our initial stockholders, who will collectively beneficially own approximately 22.3% of our common stock upon the closing of this offering (including the placement shares to be issued to the sponsor and assuming they do not purchase any units in this offering), will participate in any vote to amend our amended and restated certificate of incorporation and/or trust agreement and will have the discretion to vote in any manner they choose. Our sponsor, executive officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to allow holders to redeem their shares in connection with an initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering (or up to 24 months, if we extend the time to complete a business combination as described in this prospectus) or (ii) with respect to any other provision relating to stockholders rights or pre-business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of Class A common stock upon approval of any such amendment at a per-share price, 29 Table of Contents payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then outstanding public shares. Our sponsor, officers and directors have entered into a letter agreement with us pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and placement shares and any public shares held by them in connection with the completion of our initial business combination. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be used to pay amounts due to any public stockholders who exercise their redemption rights as described above under Redemption rights for public stockholders upon completion of our initial business combination. We will use the remaining funds to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination, including the fee payable to Mizuho Securities USA LLC upon consummation of our initial business combination for assisting us in connection with our initial business combination, as described under the section titled Underwriting Business Combination Marketing Agreement. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our amended and restated certificate of incorporation will provide that we will have only 18 months from the closing of this offering (or up to 24 months, if we extend the time to complete a business combination as described in this prospectus) to complete our initial business combination. If we are unable to complete our initial business combination within such period (and our stockholders have not approved an amendment to our charter extending this time period), we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in the case of clauses (ii) and (iii) above to our obligations under Delaware law to provide for claims of creditors and the 30 Table of Contents requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within the 18-month time period (or up to 24-month time period, if we extend the time to complete a business combination as described in this prospectus). If we anticipate that we may not be able to consummate an initial business combination within 18 months, we may, but are not obligated to, extend the period of time to consummate an initial business combination by an additional three months on two separate occasions (after the exercise of both extensions, we would have a total of up to 24 months to complete an initial business combination). Pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order to extend the time available for us to consummate our initial business combination, we, upon five days advance notice prior to the applicable deadline, must deposit into the trust account for each three month extension (of which there may be no more than two such extensions) $2,000,000, or $2,300,000 if the underwriters over-allotment option is exercised in full, adjusted proportionately in the case of a partial exercise ($0.10 per share in either case), on or prior to the date of the applicable deadline. Our public stockholders will not be offered the opportunity to vote on or redeem their shares in connection with any such extension. However, our stockholders will be entitled to vote and redeem their shares in connection with a stockholder meeting held to approve an initial business combination or in a tender offer undertaken in connection with an initial business combination if we propose such a business combination during any three-month extension period. Any such extension payments would be funded from the proceeds of a non-interest bearing loan from our sponsor to us. The terms in connection with such loans have not been negotiated and will only be finally determined at the time of entry into such loans. If we complete our initial business combination, we expect that we would repay such loaned amounts in cash out of the proceeds of the trust account released to us, or, at the discretion of our sponsor, such loan will be satisfied by the issuance of placement units at a price per unit of $10.00. The units would be identical to the placement units issued to our sponsor and the representative concurrently with the consummation of this offering. If we do not complete a business combination, we will repay such loans only from funds held outside of the trust account (unless sooner converted to units at the election of our sponsor). In the event that we determine to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the applicable deadline announcing whether or not the funds had been timely deposited. Our sponsor and their affiliates or designees are not obligated to enter into any such loan agreement with us that would allow us to fund the trust account to extend the time for us to complete our initial business combination. Furthermore, the ultimate terms of such loans may be unfavorable, or unacceptable, to us. Our sponsor, officers and directors have entered into a letter agreement with us pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and placement shares if we are forced to liquidate. 31 Table of Contents Limited payments to insiders Except for the incentive compensation described below, there will be no finder s fees, reimbursement, consulting fee, non-cash payments, monies in respect of any payment of a loan or other compensation paid by us to our sponsor, officers or directors or any affiliate of our sponsor, officers or directors prior to, or in connection with any services rendered in order to effectuate, the consummation of our initial business combination (regardless of the type of transaction that it is). However, the following payments will be made to our sponsor, officers or directors, or our or their affiliates, none of which will be made from the proceeds of this offering and the sale of the placement units held in the trust account prior to the completion of our initial business combination: Repayment of up to an aggregate of $500,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; Payment to an affiliate of our sponsor of $10,000 per month, for up to 24 months, for office space, utilities and secretarial and administrative support; Reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; Repayment of non-interest bearing loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination, the terms of which (other than as described above) have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into units, at a price of $10.00 per unit at the option of the lender, upon consummation of our initial business combination. The units would be identical to the placement units issued to our sponsor and the representative concurrently with the consummation of this offering; and Repayment of extension loans which may be made by our sponsor or an affiliate or designee of our sponsor in an amount up to $4,600,000 if we extend the period of time to consummate a business combination by up to an additional six months as described in this prospectus. The terms in connection with such loans have not been negotiated and will only be finally determined at the time of entry into such loans. If we complete our initial business combination, we expect that we would repay such loaned amounts in cash out of the proceeds of the trust account released to us, or, at the discretion of our sponsor, such loans will be satisfied by the issuance of units at a price per units of $10.00. The units would be identical to the placement units issued to our sponsor and the representative concurrently with the consummation of this offering. If we do not complete a business combination, we will repay such loans only from funds held outside of the trust account (unless sooner converted to units at the election of our sponsor). 32 Table of Contents In addition, our sponsor has agreed to make available interests in the sponsor equivalent to up to 500,000 of its founder shares as incentive compensation to any of the above individuals or any designated third party that is responsible for sourcing an acquisition target for our initial business combination. We will enter into agreements with our officers and directors to provide contractual indemnification in addition to the indemnification provided for in our amended and restated certificate of incorporation. Our amended and restated bylaws also will permit us to secure insurance on behalf of any officer, director or employee for any liability arising out of his or her actions, regardless of whether Delaware law would permit such indemnification. We will purchase a policy of directors and officers liability insurance that insures our officers and directors against the cost of defense, settlement or payment of a judgment in some circumstances and insures us against our obligations to indemnify our officers and directors. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors or our or their affiliates. Audit Committee We will establish and maintain an audit committee, which will be composed entirely of independent directors to, among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section of this prospectus entitled Management Committees of the Board of Directors Audit Committee. Conflicts of interest Members of our management team and our directors may directly or indirectly own our founder shares and/or placement units following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. In particular, because the founder shares were purchased at approximately $0.004 per share (after giving effect to the surrender of founder shares described herein), the holders of our founder shares (including members of our management team that directly or indirectly own founder shares) could make a substantial profit after our initial business combination even if our public stockholders lose money on their investment as a result of a decrease in the post-combination value of their shares of our Class A common stock (after accounting for any adjustments in connection with an exchange or other transaction contemplated by the business combination). Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors were to be included by a target business as a condition to any agreement with respect to our initial business combination. 33 Table of Contents We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions that our initial business combination is fair to our company from a financial point of view. Certain of our officers and directors presently have fiduciary or contractual obligations to other entities, including Twelve Seas II, pursuant to which such officer or director is or will be required to present a business combination opportunity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations to present the opportunity to such entity, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such entity. We believe, however, that the fiduciary duties or contractual obligations of our officers or directors will not materially affect our ability to complete our initial business combination. Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation. In addition, our sponsor, officers and directors may participate in the formation of, or become an officer or director of, any other blank check company prior to completion of our initial business combination. As a result, our sponsor, officers or directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. Although we have no formal policy in place for vetting potential conflicts of interest, our board of directors will review any potential conflicts of interest on a case-by-case basis. In particular, affiliates of our sponsor are currently sponsoring one other blank check company, Twelve Seas II. Twelve Seas II is focusing on companies located outside the United States or located in the United States but which are owned by non-U.S. stockholders, but may seek to complete a business combination in any location. Further, Mr. Richardson, our Chairman, serves as Chairman of Twelve Seas II, Mr. Elkin, our Chief Operating Officer, serves as the Chief Executive Officer and a director of Twelve Seas II, and Mr. Morris, our Chief Financial Officer, serves as the Chief Financial Officer and a director of Twelve Seas II. Any such companies, including Twelve Seas II, may present additional conflicts of interest in pursuing an acquisition target. However, we do not believe that any potential conflicts with Twelve Seas II would materially affect our ability to identify and pursue initial business combination opportunities or complete our initial business 34 Table of Contents combination, because (i) our management team has significant experience in identifying and executing multiple acquisition opportunities simultaneously, (ii) Mr. Euteneuer and Mr. Mitchell, who are not officers of Twelve Seas II, will lead our search for a business combination target, (iii) Messrs. Junior, LeMay, Medow and Walton, four of the directors that will be on our board, are not directors of or otherwise affiliated with Twelve Seas II and (iv) although we are focused on the TMT sector outside of the U.S., we are not limited by industry or geography in terms of the acquisition opportunities we can pursue. In addition, we have a committee consisting of Messrs. Richardson, Euteneuer and Humphreys to allocate targets between us and other blank check companies that our management and directors participate in. Mr. Richardson has the deciding vote on such allocation if there is a disagreement within the committee. Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business with which we have entered into a written letter of intent, confidentiality or similar agreement or business combination agreement, reduce the amount of funds in the trust account to below the lesser of (i) $10.20 per public share and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.20 per public share due to reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. However, we have not asked our sponsor to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that our sponsor s only assets are securities of our company. Therefore, we cannot assure you that our sponsor would be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses. 35 Table of Contents RISKS We are a newly formed company that has conducted no operations and has generated no revenues. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision whether to invest in our securities, you should take into account not only the background of our management team, but also the special risks we face as a blank check company. This offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see the section of this prospectus entitled Proposed Business Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419. You should carefully consider these and the other risks set forth in the section of this prospectus entitled Risk Factors beginning on page 40 of this prospectus. RISK FACTORS SUMMARY Our business is subject to numerous risks and uncertainties, including those highlighted in the section titled Risk Factors immediately following Cautionary Note Regarding Forward-Looking Statements and Risk Factors Summary. The following summary of risks and uncertainties is not exhaustive. Please read the information in the section entitled Risk Factors for a more thorough description of these and other risks. Risks relating to our search for, and consummation of or inability to consummate, a business combination, including risks and uncertainties surrounding: our ability to approve the initial business combination without affording public stockholders a vote and complete our initial business combination without the support of a majority of our public stockholders; the fact that our initial stockholders, directors and officers have agreed to vote in favor of the initial business combination we propose regardless of how our public stockholders vote; our public stockholders ability to exercise redemption rights, including your ability to effect an investment decision only by redeeming shares for cash; the requirement that we complete our initial business combination within 18 months (or up to 24 months, if we extend the time to complete a business combination as described in this prospectus) and any potential leverage this could give prospective targets; our ability to search for a business combination and to consummate an initial business combination due to the uncertainty resulting from the COVID-19 pandemic; our pool of prospective target business, including our ability to select an appropriate target business and our expectations around the performance of the prospective target businesses; and our potential ability to obtain additional financing if necessary to complete our initial business combination. Risks relating to our securities, including risks and uncertainties surrounding: the possibility that Nasdaq may delist our securities from trading on its exchange; being declared an investment company under the Investment Company Act or a passive foreign investment company; our ability to amend the terms of warrants with approval of holders of at least 50% of the then outstanding public warrants in a manner that may be adverse to the holders thereof; our ability to redeem your unexpired warrants prior to their exercise at a time that would make them worthless; 36 Table of Contents the grant of registration rights which may inhibit the completion of our initial business combination or adversely affect the market price of our shares of Class A common stock; and potential lack of liquidity and trading of our securities. Risks relating to our management, including risks and uncertainties surrounding: our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving our initial business combination; the ability of our officers and directors to generate a number of potential business combination opportunities; our sponsor, officers and directors losing their entire investment in us if our initial business combination is not completed; our success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business combination; and Since our sponsor, executive officers and directors will lose their entire investment in us if our initial business combination is not completed (other than with respect to public shares they may acquire during or after this offering), and because our sponsor, officers and directors who have an interest in founder shares may profit substantially from a business combination even under circumstances where our public stockholders would experience losses in connection with their investment, a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination. Other general risks, including risks and uncertainties surrounding: being a blank check company with no operating history and no revenues; our ability to comply with changing laws and regulations; data privacy and security breaches; and acquiring and operating a business in foreign countries. 37 Table of Contents SUMMARY FINANCIAL DATA The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. December 31, 2021 Actual As Adjusted Balance Sheet Data: Working (deficiency) capital(1) $ (322,992 ) $ 3,423,303 Total assets(2) 439,598 207,423,303 Total liabilities 416,295 Value of common stock subject to possible redemption(3) 204,000,000 Stockholders equity(4) 23,303 3,423,303 ____________ (1) The as adjusted calculation includes $3,400,000 of cash held outside the trust account, plus $23,303 of actual stockholder s equity on December 31, 2021. (2) The as adjusted calculation equals $204,000,000 cash held in trust from the proceeds of this offering and the sale of the placement units, plus $3,400,000 of cash held outside the trust account, plus $23,303 of actual stockholder s equity at December 31, 2021. (3) The as adjusted calculation is comprised of the number of shares subject to redemption multiplied by the redemption rate ($10.20 per share). (4) Excludes 20,000,000 shares of common stock purchased in the public market which are subject to redemption in connection with our initial business combination. The as adjusted calculation equals the as adjusted total assets, less the as adjusted total liabilities, less the value of shares of common stock that may be redeemed in connection with our initial business combination. 38 Table of Contents
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to we, us, company or our company are to Intrepid Acquisition Corporation I, and references to: amended and restated certificate of incorporation are to our amended and restated certificate of incorporation to be in effect upon completion of this offering; Board are to our board of directors; common stock are to our Class A common stock and our Class B common stock, collectively; CW Interests are to Three Two Seven Family Management, LLC, d/b/a CW Interests, a Texas limited liability company that (i) is owned by James C. Rad Weaver, one of our director nominees, and (ii) owns a minority interest in our sponsor, together with its affiliates; directors are to our current directors and our director nominees named in this prospectus; equity-linked securities are to any securities of our company convertible into, or exchangeable or exercisable for, shares of Class A common stock of our company, issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt; founder shares are to shares of our Class B common stock initially purchased by our sponsor in a private placement prior to this offering, and the shares of our Class A common stock issued upon the conversion thereof as provided in this prospectus, collectively; initial stockholders are to our sponsor and any other holders of our founder shares prior to this offering; IPI are to Intrepid Potash, Inc., a Delaware corporation and the majority owner of our sponsor; letter agreement are to the letter agreement that our sponsor, officers and directors have entered into with us, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team are to our officers; private placement warrants are to the warrants to be issued to our initial stockholders in a private placement that will close simultaneously with the closing of this offering, and upon conversion of the sponsor loan and upon conversion of working capital loans, if any, and to those warrants issued in connection with our sponsor electing to exercise its option to extend the period of time we will have to complete an initial business combination by three months; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our initial stockholders and members of our management team and Board to the extent any of them purchases public shares, provided that each such initial stockholder s and individual s status as a public stockholder shall only exist with respect to such public shares; public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); specified future issuance are to an issuance of a class of equity or equity-linked securities to specified purchasers that we may determine to make in connection with financing our initial business combination; sponsor are to Intrepid Acquisition Sponsor LLC, a Delaware limited liability company, a subsidiary of IPI in which IPI holds a majority interest and in which CW Interests holds a minority interest; sponsor loan is to the $4,000,000 (or $4,600,000 if the underwriters overallotment option is exercised in full) that our sponsor has agreed to lend us as of the closing date of this offering at no interest, the proceeds of which will be added to the trust account described herein and repaid or TABLE OF CONTENTS The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUSSUBJECT TO COMPLETION, DATED JANUARY 19, 2022 $200,000,000 Intrepid Acquisition Corporation I 20,000,000 Units Intrepid Acquisition Corporation I is a newly organized blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any potential initial business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any initial business combination target regarding an initial business combination with us. Although we may pursue an acquisition in any industry or geography, we intend to capitalize on the ability of our management team and our initial stockholders (each as defined herein), to identify, acquire and operate a business that may provide opportunities for attractive risk-adjusted returns in the energy, natural resources and environmental and water infrastructure industries in North America (including, without limitation, related services and technologies). This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one share of our Class A common stock and one-half of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as described in this prospectus, and only whole warrants are exercisable. The warrants will become exercisable on the later of (i) 30 days after the completion of our initial business combination and (ii) 12 months from the closing of this offering and will expire five years after the completion of our initial business combination or earlier upon redemption of the warrants or liquidation of our company, as described in this prospectus. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We have also granted the underwriters a 45-day option to purchase up to an additional 3,000,000 units to cover over-allotments, if any. We will provide our public stockholders with the opportunity to redeem all or a portion of their shares of our Class A common stock upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes as well as expenses relating to the administration of the trust account (subject to the limitation discussed below), divided by the number of then issued and outstanding shares of Class A common stock that were sold as part of the units in this offering (our public shares ), subject to the limitations described herein. If we anticipate that we may not be able to complete our initial business combination within 18 months from the closing of this offering, that time period can be extended in two ways, as described in more detail below in this prospectus. If we are unable to complete our initial business combination within 18 months from the closing of this offering (or up to 21 months from the closing of this offering, if we extend that time period, as described in this prospectus), we will redeem 100% of the public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes as well as expenses relating to the administration of the trust account (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then issued and outstanding public shares, subject to applicable law and as further described herein. Intrepid Acquisition Sponsor LLC, a Delaware limited liability company, which we refer to throughout this prospectus as our sponsor, is a subsidiary of Intrepid Potash, Inc., a Delaware corporation, which we refer to throughout this prospectus as IPI , in which IPI holds a majority interest. IPI s common stock is listed on The New York Stock Exchange (the NYSE ) under the symbol IPI. Three Two Seven Family Management, LLC, d/b/a CW Interests, a Texas limited liability company, which, together with its affiliates, we refer to throughout this prospectus as CW Interests, is an entity that (i) is owned by James C. Rad Weaver, one of our director nominees, and (ii) owns a minority interest in our sponsor. Our sponsor has committed to purchase 6,500,000 warrants (or 7,100,000 warrants if the underwriters over-allotment option is exercised in full) at a price of $1.00 per whole warrant ($6,500,000 total, or $7,100,000 total if the underwriters over-allotment option is exercised in full) in a private placement that will close simultaneously with the closing of this offering. We refer to these warrants as the private placement warrants throughout this prospectus. Our sponsor has an option to purchase additional private placement warrants in order to extend the period of time we will have to complete an initial business combination by up to an additional three months. Each whole private placement warrant is exercisable to purchase one whole share of our Class A common stock at $11.50 per share, subject to adjustment as provided in this prospectus. In addition, our sponsor has agreed to lend us $4,000,000 (or $4,600,000 if the underwriters overallotment option is exercised in full) as of the closing date of this offering at no interest, which we refer to as our sponsor loan throughout this prospectus. The proceeds of the sponsor loan will be added to the trust account described below and the sponsor loan will be repaid or converted into private placement warrants at a conversion price of $1.00 per warrant, at the sponsor s discretion, at any time up until the earlier of the consummation of an initial business combination and the liquidation of our company, as discussed elsewhere in this prospectus. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to one or more other entities, including IPI or otherwise, pursuant to which such officer or director is or will be required to present a business combination opportunity to one or more of such entities subject to his or her fiduciary duties. Also, none of our initial stockholders, IPI or any of our directors and officers is prohibited from sponsoring, investing or otherwise becoming involved with any other blank check companies, including in connection with their initial business combinations, subject to his or her fiduciary duties. As a result, if any of our officers or directors becomes aware of an initial business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, including IPI or otherwise, then he or she will have a conflict in deciding as to the entity to which he or she presents such business combination opportunity TABLE OF CONTENTS converted into private placement warrants at a conversion price of $1.00 per warrant, at the sponsor s discretion, at any time up until the earlier of the consummation of an initial business combination and the liquidation of our company, as discussed elsewhere in this prospectus; units are to one share of Class A common stock and one-half of one redeemable warrant; warrants are to our warrants, which include the public warrants as well as the private placement warrants; and working capital loans are to funds that our sponsor or an affiliate of our sponsor, or certain of our officers and directors, may, but are not obligated to, loan to us as may be required in order to fund working capital deficiencies or finance transaction costs in connection with an intended initial business combination, which may be converted into warrants at a price of $1.00 per warrant at the option of the lender, as discussed elsewhere in this prospectus. Each unit consists of one share of Class A common stock and one-half of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as described in this prospectus, and only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Except to the extent we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option and the corresponding forfeiture by our sponsor of 750,000 founder shares. Proposed Business General We are a newly incorporated blank check company incorporated as a Delaware corporation and formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. To date, our efforts have been limited to organizational activities and activities related to this offering. We have not selected any potential initial business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any initial business combination target regarding an initial business combination with us. Our mission is to identify unique, undervalued companies, assets, technologies, or solutions in an industry that complements each of our management team s, Board s and sponsor s expertise and that will benefit from our strategic and operational knowledge to enhance value. Following our initial business combination, our current management team may maintain operational control over the post-initial business combination business in order to grow the business and direct its long-term strategy. While we may pursue our initial business combination in any business or industry, we believe the diverse experience and extensive relationship network of our management team, Board and sponsor may provide opportunities for attractive investment opportunities in industry sectors in which that experience and relationship network are most relevant, particularly in the energy, natural resources and environmental and water infrastructure industries in North America (including, without limitation, related services and technologies). Further, we intend to prioritize environmental, social, and governance ( ESG ) factors in selecting a target by giving extra attention to targets that we believe can supply the critical materials and energy the world needs, while also employing practices and technologies designed to limit carbon intensity and greenhouse gas ( GHG ) emissions, reduce or repurpose waste streams, and/or enhance global access to clean water and food. Our management team has extensive experience identifying and executing acquisitions of assets and companies in various industries, including, but not limited to, energy and natural resources, that we believe can benefit from advances in technology and sound management practices. Our management team has experience working with both private and public companies as active owners, executives and directors to maximize value from diverse asset bases and establish environmentally friendly operations TABLE OF CONTENTS and it may be the case that he or she may only present such opportunity to us if such other entity rejects the opportunity. If these other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. Our initial stockholders currently own 5,750,000 shares of our Class B common stock (up to 750,000 shares of which are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised). We refer to these shares of Class B common stock as the founder shares throughout this prospectus. The shares of Class B common stock will automatically convert into shares of Class A common stock at the time of our initial business combination, on a one-for-one basis, subject to adjustment as provided in this prospectus. Currently, there is no public market for our units, Class A common stock or warrants. We intend to list our units on the Nasdaq Global Market ( Nasdaq ) under the symbol IACIU on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on Nasdaq. We expect the Class A common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless Cowen and Company, LLC and Intrepid Partners, LLC inform us of their decision to allow earlier separate trading, subject to our filing a Current Report on Form 8-K with the Securities and Exchange Commission (the SEC ) containing an audited balance sheet of the company reflecting our receipt of the gross proceeds of this offering and issuing a press release announcing when such separate trading will begin. Once the securities comprising the units begin separate trading, we expect that the Class A common stock and warrants will be listed on Nasdaq under the symbols IACI and IACIW, respectively. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements compared to other public companies. Investing in our securities involves a high degree of risk. See the section of this prospectus entitled Risk Factors beginning on page 39 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $10.00 $200,000,000 Underwriting discounts and commissions(1) $0.55 $11,000,000 Proceeds, before expenses, to us $9.45 $189,000,000 (1) Includes $0.35 per unit, or $7,000,000 (or up to $8,050,000 if the underwriters over-allotment option is exercised in full) in the aggregate, payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein. The deferred commissions will be released only on completion of an initial business combination, in an amount equal to $0.35 multiplied by the number of shares of Class A common stock sold as part of the units in this offering, as described in this prospectus. Does not include certain fees and expenses payable to the underwriters in connection with this offering. See also Underwriting for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering, the entry into the sponsor loan and the sale of the private placement warrants described in this prospectus, $204.0 million (or $234.6 million if the underwriters over-allotment option is exercised in full), $10.20 per unit, in either case, will be deposited into a U.S.-based trust account at J.P. Morgan Chase Bank, N.A. with Continental Stock Transfer & Trust Company acting as trustee, and approximately $2.5 million will be available to pay fees and expenses in connection with the closing of this offering and for working capital following the closing of this offering. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our franchise and income taxes as well as expenses relating to the administration of the trust account, the proceeds from this offering, the entry into the sponsor loan and the sale of the private placement warrants will not be released from the trust account until the earliest to occur of (a) the completion of our initial business combination, (b) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering (or up to 21 months from the closing of this offering, if we extend that time period, as described in this prospectus) or (ii) with respect to any other provision relating to stockholders rights or pre-initial business combination activity, and (c) the redemption of our public shares if we are unable to complete our initial business combination within 18 months from the closing of this offering (or up to 21 months from the closing of this offering, if we extend that time period, as described in this prospectus), subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2022. Joint Book-Running Managers Cowen Intrepid Partners , 2022 TABLE OF CONTENTS that can deliver sustainable cash flows. Our current management team aims to maintain operational control over the post-initial business combination business and act as a long-term manager of its target asset or business. Our objective is to provide our target asset or business an efficient path to go public with a significant degree of ongoing funding certainty, while creating value for our stockholders by identifying value-enhancing opportunities and providing ongoing management support for such functions as strategy, business planning, capital structure optimization, team building, and administrative support. Our Sponsor Our sponsor is co-owned by (i) IPI (NYSE: IPI), a diversified fertilizer and oilfield solutions company, and (ii) CW Interests, an entity owned by James C. Rad Weaver, one of our director nominees. IPI s operations provide essential potassium, magnesium, sulfur, salt, and water products to customers in the agriculture, animal feed and oil and gas industries. IPI s oil field services business is a provider of essential midstream services to operators in the Delaware Basin of Southeast New Mexico. Through its extensive and diverse water and land holdings, IPI is expanding its business to provide full-cycle water management services (source, recycle/treating, and disposal) to producers and operators in the Delaware Basin. CW Interests is a private investment management firm with offices in San Antonio, Texas. CW Interests specializes in direct investments in private operating businesses and has completed successful transactions across various industries. Robert P. Jornayvaz III, our Chairman and Chief Executive Officer and IPI s Executive Chairman and Chief Executive Officer, has significant transaction experience in the natural resources industry as both a buyer and seller through his exploration company, Intrepid Oil and Gas, LLC, and his production company, Intrepid Production Corporation ( IPC ), primarily focusing on the Paradox Basin in Utah, the Green River Basin in Wyoming and the Eagle Ford in Texas. Our sponsor s co-owner, CW Interests (as well as its owner, James C. Rad Weaver), has invested in numerous privately held businesses across several industries, including energy, insurance brokerage, construction, spirits and quick service restaurants. Through its investment in Prophet Advantage Partners LP (the PAP Fund ), CW Interests led the out of court restructuring and ultimate turnaround of Jonah Energy LLC, a leading Rocky Mountains natural gas producer ( Jonah Energy ). The PAP Fund is a pooled investment vehicle in which CW Interests is an investor, with Mr. Weaver acting as a consultant to the PAP Fund and representing the PAP Fund s interest on the board of directors of Jonah Energy. We believe CW Interests experience investing in private companies with diverse operating models and often complex financial structures, including those in the North American energy, natural resources and environmental industries, will benefit us in identifying and evaluating a target asset and/or company for our initial business combination. IPI is the only U.S. producer of muriate of potash (sometimes referred to as potassium chloride or potash), which is applied as an essential nutrient for healthy crop development, utilized in several industrial applications and used as an ingredient in animal feed. In addition, IPI produces a specialty fertilizer, Trio , which delivers three key nutrients, potassium, magnesium, and sulfate in a single particle. IPI has used the mining and industrial asset base to expand into oilfield services. Through these services, IPI has become a provider of water and brine solutions for energy producers in the western United States, primarily serving the Delaware Basin. Through its recent acquisition of Intrepid South (as defined below), IPI has accelerated the growth of its related midstream services and has become a key supplier to producers and operators in the Delaware Basin. The strategically advantaged locations of IPI s mining and water assets have positioned IPI to develop first-hand knowledge of the distinct geology, labor, regulatory, environmental, and business climate in the North American energy, natural resources, and environmental industries where we plan to seek a target asset and/or company for our initial business combination. We believe this knowledge will be valuable in identifying and evaluating investment opportunities. We intend to capitalize on our management team s and IPI s history of identifying and unlocking value in underutilized assets. Under Mr. Jornayvaz s leadership, Intrepid Mining LLC, IPI s predecessor TABLE OF CONTENTS ( Intrepid Mining ), acquired IPI s first potash mine in Moab, Utah and quickly turned around its performance by drilling horizontal potash wells to revive production and add decades to the expected mine life. This enhanced production enabled the mine to significantly reduce its salt tailings pile by reusing it to produce injection brine, further enhancing value by reducing asset retirement obligation ( ARO ) liability and improving the mine s environmental footprint. Mr. Jornayvaz built on this success as he directed Intrepid Mining's acquisitions of its Wendover, Utah, and Carlsbad, New Mexico potash mines and implemented similar cutting-edge technological innovations in solar solution mining and langbeinite recovery to enhance the value of those operations. IPI completed its initial public offering in April 2008. IPI s potash mines all employ solar evaporation processes, an eco-friendly method of producing potash. To extract potash, IPI extracts naturally occurring potash brines or manufactures brine underground by injecting saltwater into underground deposits that are no longer economically minable with conventional methods. The brine dissolves the remaining potash reserves into a liquid. The liquid is then pumped into a solar evaporation pond where the potash will recrystallize after the water evaporates. By using solar ponds to crystallize potash, IPI avoids the need to use natural gas, coal or fuel oil to fuel crystallizers, reducing IPI s carbon footprint compared to non-solar facilities. Through over 20 years of operating these mines, IPI has cultivated an expertise in handling complex brines that will enable us to identify potential value-creation opportunities in brine- and water-handling assets. IPI also owns water rights in New Mexico. IPI has rapidly expanded its sale of water products to support oil and gas producers in the Northern Delaware Basin from near-zero in 2016 to generate over $19 million in revenues during the twelve months ended September 30, 2021. In May 2019, IPI acquired certain land, water rights, state grazing leases for cattle, and other related assets from Dinwiddie Cattle Company to further cement its position as a leading water solutions provider in New Mexico. We refer to these assets and operations as Intrepid South. The strategic location of Intrepid South and first-hand knowledge provided by IPI s ongoing business operations provide us with excellent market visibility and contacts that likely will be valuable in both identifying and evaluating a target asset or business for our initial business combination. IPI is committed to responsibly developing and operating its infrastructure and deploying technology to advance sustainability and reduce its water and carbon footprint. IPI has demonstrated its ESG leadership and commitment by meeting ambitious sustainability targets, including the elimination and re-use of tailings at its potash mine in Moab, Utah and adapting its HB solution mine in Carlsbad, New Mexico to enable use of 100% brackish, non-potable water sources. IPI s ESG efforts are driven by the technical, operational, and financial capabilities of its seasoned management team, which collectively has decades of experience operating and leading companies in the natural resources sector. CW Interests has applied emerging solar energy and emissions control technologies to reduce the environmental impact of its investments. CW Interests is the manager of, and part of a group of investors in, 327 NWP Investors, LLC ( NWP ). NWP is working to become an emerging leader in solar engineering, procurement and construction through its ownership of D4 Infrastructure, LLC, Associated Pipeline Contractors, Inc., R&R Pipeline Construction and Repair, Inc. and HMS Construction Co. Jonah Energy is an industry leader in the detection and reduction of fugitive methane emissions and the first U.S.-based company to achieve the Gold Standard Emissions rating of the International Methane Emissions Observatory. We believe our management team, in tandem with our sponsor and our Board, is well positioned to identify attractive initial business combination targets. We intend to leverage our significant industry and transaction expertise to achieve our initial business combination. In addition, we believe we will benefit from our management team s, IPI s, CW Interests , and our Board s collective relationship network, which includes senior executives at public and private companies and private equity firms and longstanding relationships with a wide range of multi-disciplinary advisory firms. Collectively, our management, IPI, CW Interests and our Board have extensive backgrounds in sourcing acquisition opportunities, underwriting, execution, and leading post-acquisition value-creation initiatives. Additionally, we believe IPI s commitment to environmental, public health, safety and governance issues will be critically important in helping identify and differentiate us with prospective initial business combination targets. TABLE OF CONTENTS You should not rely on the historical record or performance of IPI or our management team as indicative of the future performance of an investment in us or the returns we will, or are likely to, generate going forward. See Risk Factors Risks Relating to our Search for, and Consummation of, or Inability to Consummate, an Initial Business Combination Past performance by our team or IPI, including investments and transactions in which they have participated and businesses with which they have been associated, may not be indicative of future performance of an investment in us, and we may be unable to provide positive returns to stockholders. Our Management Team and Board Management Robert P. Jornayvaz III has served as our Chairman and Chief Executive Officer since September 2021. He was one of the original co-founders of Intrepid Mining, IPI s predecessor. Mr. Jornayvaz has served as IPI s Executive Chairman of the board of directors since 2010 and as IPI s Chief Executive Officer since August 2014 and served as IPI s President from August 2014 until August 2021. He previously served as IPI s Chairman of the board of directors and Chief Executive Officer from its formation in 2007 until 2010. Mr. Jornayvaz served, directly or indirectly, as a manager of Intrepid Mining from 2000 until its dissolution at the time of IPI s initial public offering in 2008. He has diverse business interests in addition to IPI, including ownership and executive positions in various public and private oil and gas exploration and production, construction, and real estate companies. Mr. Jornayvaz has over 35 years of experience running IPC, Intrepid Mining and IPI, which has included sourcing, acquiring, developing, managing financing, and divesting assets and companies in various industries, including mining, oil and gas, real estate, and construction projects through the various companies with which he is affiliated. Mr. Jornayvaz, as Chairman and Chief Executive Officer, was also the architect of Intrepid Mining s acquisitions of its Moab, Wendover, and Carlsbad facilities prior to taking the company public in 2008. E. Brian Stone has served as our President and Chief Operating Officer since September 2021. He has served as IPI s President since August 2021 and as IPI s Chief Operating Officer since December 2019. Prior to joining IPI, Mr. Stone was the Chief Operating Officer for Hupecol Operating Co. LLC, an international oil and gas company focused on South America and Europe ( Hupecol ), from 2005 to 2019. During his tenure at Hupecol, and its affiliated company (Dan A. Hughes Co.), Mr. Stone sourced, negotiated, and closed approximately $2 billion in transactions. Prior to joining Hupecol, Mr. Stone was a Managing Director for Huber Energy Services, a division of J.M. Huber Corporation ( Huber ). He also served as Chief Risk Officer in Huber s Edison, New Jersey headquarters, and was Vice President of Marketing in the Houston-based Energy Division. Mr. Stone has 35 years of experience in the natural resources industry. Matthew D. Preston has served as our Chief Financial Officer since September 2021. He has been IPI s principal financial officer and principal accounting officer since November 2019 and has served as IPI s Chief Financial Officer since December 2021. Mr. Preston served as IPI s Vice President of Finance from November 2019 to December 2021 and as IPI s Director of Budget and Forecast from April 2016 to November 2019. Previously, Mr. Preston served in successively more senior finance roles after joining IPI in 2008, including Senior Manager of Budget and Forecast, Manager of Budget and Forecast, and Financial Analyst. His current role requires navigating the distinctive financial challenges faced by a commodity-oriented business. Kyle R. Smith has served as our General Counsel and Secretary since September 2021. He has been IPI s Vice President, General Counsel and Secretary since December 2019. Before joining IPI, Mr. Smith served as General Counsel for an Alaska Native Claims Settlement Act Regional Corporation. Prior to that, Mr. Smith was in private practice from July 2017 to January 2019, and served as Executive Vice President and General Counsel for Echo Energy, a start-up pure-play oil and gas company, from December 2016 to June 2017 and as Assistant General Counsel for Operations for Continental Resources, a large independent upstream producer, from 2014 to June 2016. Directors Robert P. Jornayvaz III has served as our Chairman and Chief Executive Officer since September 2021. See biographical information under Management above. TABLE OF CONTENTS James C. Rad Weaver will serve as a Board member upon the closing of this offering. Mr. Weaver, through CW Interests, is a co-owner of our sponsor. He is the founder, owner and the Chief Executive Officer of CW Interests. Prior to CW Interests, Mr. Weaver served as the Chief Executive Officer of McCombs Partners, the investment management division of McCombs Enterprises, the family office of Red McCombs, from 2006 to 2020. Mr. Weaver is a member of several public and private boards, including Build Acquisition Corp. (NYSE: BGSX), a blank check company targeting the enterprise software and technology-enabled services markets, since March 2021, KB Home (NYSE: KBH), a homebuilding company based in the United States, since October 2017, Jonah Energy, since 2020, Cox Enterprises, Inc., a privately held global conglomerate, since 2015, Milestone Brands LLC, an acquirer and builder of alcohol beverage brands, since 2015. He also serves as Vice Chairman of The University of Texas Board of Regents. Mr. Weaver serves as the Chairman of The University Lands Advisory Board and as a member of the board of UTIMCO (The University of Texas/Texas A&M Investment Management Company). Mr. Weaver brings a wealth of deal making experience to the Board, having completed a significant number of transactions in various industries, including investments in Jonah Energy, HMS Construction, Inc., a specialized general engineering and electrical contractor, D4 Infrastructure, LLC, a privately owned holding company that supports all facets of infrastructure in the United States, a privately held, regional fast food restaurant chain that specializes in hamburgers and a fintech insurance brokerage. William D. Von Gonten, Jr. will serve as a Board member upon the closing of this offering. Mr. Von Gonten has served as the President of W.D. Von Gonten & Co. since November 1995 and Chief Executive Officer of W.D. Von Gonten Laboratories, LLC since October 2013. He is an expert on unconventional resource evaluation and has worked on nearly all of the world s major oil and gas plays including the Permian Basin, Eagle Ford, Bakken Formation, Denver Julesburg Basin, Marcellus Formation and Vaca Muerta Formation as well as various Middle Eastern fields. Irene G. Lofland will serve as a Board member upon the closing of this offering. Ms. Lofland is a financial expert with extensive experience working with boards across a broad array of finance and audit committee, enterprise risk management, investor relations and corporate governance matters. She held numerous executive roles at DCP Midstream ( DCP ), a Fortune 500 energy company, including leading investor relations, internal audit, treasury, enterprise risk management, ethics and compliance, information technology and credit during her time with DCP and its predecessor companies from August 1995 to August 2019. Her diverse experience includes executing over $1.5 billion of capital market transactions, participating in initial public offerings and merger and acquisition activity and navigating cyclical and commodity sensitive businesses. Dan C. Perry will serve as a Board member upon the closing of this offering. Mr. Perry has served as the owner and sole proprietor of The Law Offices of Dan C. Perry since 2006. Before that, he was a partner of Perry & Kellogg LLP from 1992 to 2006. In addition, Mr. Perry is the Owner and President of Agave Mineral Management, Inc., which offers a variety of mineral management advisory and management services. Mr. Perry has practiced oil and gas law in Texas and New Mexico for over 35 years, focusing exclusively on representing mineral owners with their oil and gas leases. During that period, he has negotiated and drafted numerous oil and gas leases, and has tracked the drilling and production of hundreds of oil and gas wells. He currently serves as Mineral Manager (typically as a Trustee, General Partner or Limited Liability Company Manager) for multiple family entities, with approximately 150,000 acres of minerals under his direct control. Market Opportunity We believe the demand for unconventional energy resources, evolving agricultural practices, and growing population in arid regions has created compelling opportunities to provide full-cycle water management. This is especially apparent in geographic regions such as the Permian Basin of Southeast New Mexico and West Texas, where energy producers must source large volumes of water for hydraulic well completions and later dispose of large volumes of saline produced water. Further, the development of natural resources is becoming increasingly ESG-focused and we believe that assets in the natural resources value chain, particularly those focused on full-cycle water management, continue to present attractive investment opportunities for a number of reasons: TABLE OF CONTENTS Increasingly ESG-Focused Stakeholders: Investors, customers and employees continue to increase the value placed on ESG initiatives in their decision-making processes. We believe businesses that meaningfully and successfully integrate ESG initiatives and sustainability-oriented innovation into their operations will create differentiated value. Ecological soundness and sustainability of water sourcing, usage and discharge is becoming a key focus for ESG-focused stakeholders in the natural resources industry. Strong Demand for Water Infrastructure and Services: The U.S. oil and gas industry is adjusting to increasing demand with substantial investment in water infrastructure from operators, independent water midstream service providers and private investors. A key driver of the significant investment in the full-cycle water management segment is the significant amount of water sourced, utilized and disposed of as part of exploration and production ( E&P ) operations. For example, according to Spears and Associates, the amount of water typically needed during drilling operations to make up the drilling fluid can reach approximately 10,000 barrels per horizontal well and the amount of water needed for hydraulic fracturing in modern unconventional wells can exceed 500,000 barrels per well. We believe producers are interested in contracting for whole services packages to water service providers so they can focus on their core operations, and we believe the resulting opportunities for water sector participants are significant. Sizeable Target Market: Spears and Associates estimates that the overall U.S. oilfield water management market will total approximately $21 billion in 2021, an increase of approximately 24% from 2020. Water systems have grown in scale, complexity and capital investment, prompting some operators to divest or outsource water operations to third parties. Many of the third parties have been capitalized by private capital providers. As of February 2020, the Global Water Intelligence ( GWI ) estimated approximately $9 billion to $11 billion of private capital had been committed to the oilfield midstream business at that time. GWI also estimated $16 billion of private investment is likely to be required over the next ten years, much of which is expected to be in the Delaware Basin. Given the significant capital invested in the space and the strong fundamentals supporting the full-cycle management segment, we believe that there are currently many investment opportunities in the full-cycle water management sector that would be attractive to investors. Mission Critical Infrastructure: We believe traditional water management practices fall short of the complex and developing needs of E&P companies. Sustaining oil and gas production in the Permian Basin is contingent upon the ability of producers to efficiently manage increasing volumes of produced water and develop infrastructure that can meet the regulatory, economic and geological pressures threatening to bottleneck operations. Produced-water reuse is emerging as a cost-competitive opportunity for E&P companies to meet issues associated with increasing hydraulic fracturing water demand and shifting regulatory pressures encouraging produced water recycling and re-use over saltwater disposal. The foregoing overview of the market opportunity is not intended to be exhaustive. We may pursue an initial business combination with a target business in any industry, sector, or geographic location. Our Competitive Strengths Our management team s extensive and diversified experience in various industries provides the platform to effectively identify, evaluate and close acquisition targets. We believe that the combined capabilities of our management team, sponsor and Board position us to thoughtfully source, analyze and execute a high-quality initial business combination on value-enhancing terms from a significant potential pipeline of actionable target assets and businesses. Our competitive strengths include the following: Dynamic Sourcing Network and Leading Industry Relationships. IPI s on-the-ground operations in the Northern Delaware Basin provide what we believe to be an unrivaled depth of market intelligence. In addition, our team has an extensive personal network developed through decades of natural resources industry experience. Public Company Experience. Our sponsor s parent company has been a public company since April 2008, which has allowed us to gain functional experience in areas such as public capital raises, investor relations, public financial reporting, and stockholder engagement. TABLE OF CONTENTS Proven Understanding of, and Ability to Navigate, Energy- and Mining-Related Regulatory Regimes. Our management team operates in the highly regulated natural resources industry and deals regularly with the Bureau of Land Management ( BLM ), U.S. Environmental Protection Agency (the EPA ), Offices of State Engineers ( OSE ), and other regulatory bodies governing resources and environment. Furthermore, IPI recently built a new potash mine (HB solution mine) in New Mexico, which has required completion of a multi-year environmental impact study ( EIS ) and extensive negotiations with regulators, local movements, and other stakeholders. Finally, our management team has built strong relationships with regulatory agencies though decades of responsible operation. Long Track Record of Senior Leadership and Increasing Stockholder Value. Our management team has nearly 100 years of combined experience in the natural resources industry, including over 40 years of combined experience as C-level executives of large public and private companies in our target industries. Our Business Strategy Although we may pursue an initial business combination in any business industry or sector, our business strategy is to identify and acquire an undervalued asset or business with an attractive growth profile that we believe will benefit from our sponsor s extensive operating expertise and deep commercial, financial, structuring, and public market expertise. We intend to look to acquire an asset or business that: possesses a compelling and sustainable competitive advantage in its industry; complements the experience of our management team and directors and the IPI team; has unrealized value potential that can be realized through operational, financial, and/or strategic improvements; presents a desirable ESG profile within its industry; can benefit from our team s operational and financial expertise; and represents a compelling investment opportunity for us, our stockholders and our sponsor s respective stockholders. We intend to focus our efforts on opportunities where we feel we have a competitive advantage and are best situated to enhance the value of the business after completion of the initial business combination. We believe our existing relationship network and methodical approach to deal sourcing will be advantageous in the initial business combination process. We also believe our sponsor s reputation and management experience through multiple commodity cycles should add substantial value to our target asset or business following the initial business combination. Our Acquisition Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating targets for our initial business combination. We will use these and other criteria and guidelines in evaluating initial business combination opportunities but may decide to enter into our initial business combination with a target asset or business that does not meet any or all of these criteria and guidelines. has a differentiated and sustainable business model with a defensible market position; presents an opportunity for our management team to maintain operational control over the post-initial business combination business; will benefit from our management team s operational and financial expertise to create value from existing assets and ability to direct future capital deployment, especially a company or asset that: presents opportunities to reduce costs, increase production or otherwise optimize operations that would result in near-term improved economics and returns to stockholders; TABLE OF CONTENTS has been underinvested in by current owners due to, among other causes, liquidity limitations, the pressure of borrowing-base reserve value reductions, the capital intensity of other operations or balance sheet considerations; and/or is at an inflection point requiring additional capital, additional operational expertise or is susceptible to innovative and superior optimization techniques that drive improved financial performance; will be well received by public investors and can benefit from access to the public capital markets, including ESG-focused investors; possesses sufficient scale and resources to achieve a successful transition into the public market; has opportunities to grow the business organically and via acquisitions; and is expected to generate attractive risk-adjusted returns for our stockholders. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management team may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet any or all of the above criteria and guidelines, we will disclose that the target asset or business does not meet the above criteria in our stockholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials that we would file with the SEC. Our Acquisition Process In evaluating a prospective target asset or business, we expect to conduct an extensive due diligence review which may encompass, as applicable and among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities and a review of financial and other information about the target and its industry. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, IPI, or any of our or their respective officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, IPI, or any of our or their respective officers or directors, we, or a committee of independent directors, will obtain a fairness opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions that such initial business combination is fair to our company from a financial point of view. We are not required to obtain such a fairness opinion in any other context. Certain of our directors and officers will, directly or indirectly, own founder shares and/or private placement warrants following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. In particular, because the founder shares and private placement warrants will be worthless if we do not complete an initial business combination, the holders of our founder shares and private placement warrants (including members of our management team that directly or indirectly own founder shares or private placement warrants) could make a substantial profit from an initial business combination that causes our public stockholders to lose money on their investment as a result of a decrease in the post-combination value of their shares of Class A common stock (after accounting for any adjustments in connection with an exchange or other transaction contemplated by the initial business combination). See Risk Factors Risks Relating to our Search for, and Consummation of, or Inability to Consummate, an Initial Business Combination Since our initial stockholders will lose their entire investment in us if our initial business combination is not completed and our officers and directors may have differing personal and financial interests than you, a conflict of interest may arise in determining whether a particular initial business combination target is appropriate for our initial business combination. Further, such officers and directors may have a conflict of interest with respect to evaluating a particular initial business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. TABLE OF CONTENTS We currently do not have any specific initial business combination under consideration. Our officers and directors have neither selected nor considered any individual target business, nor have they had any substantive discussions regarding possible target businesses among themselves or with our underwriters or other advisors. Our management team is regularly made aware of potential business opportunities, one or more of which we may desire to pursue for an initial business combination, but we have not (nor has anyone on our behalf) contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to an initial business combination transaction with our company. Additionally, we have not, nor has anyone on our behalf, taken any substantive measure, directly or indirectly, to identify or locate any suitable acquisition candidate for us, nor have we engaged any agent or other representative to identify or locate any such acquisition candidate. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to one or more other entities, including IPI or otherwise, pursuant to which such officer or director is or will be required to present a business combination opportunity to one or more of such entities subject to his or her fiduciary duties. Also, none of our initial stockholders, IPI or any of our directors and officers is prohibited from sponsoring, investing or otherwise becoming involved with any other blank check companies, including in connection with their initial business combinations, subject to his or her fiduciary duties. As a result, if any of our officers or directors becomes aware of an initial business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, including IPI or otherwise, then he or she will have a conflict in deciding as to the entity to which he or she presents such business combination opportunity and it may be the case that he or she may only present such opportunity to us if such other entity rejects the opportunity. If these other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. However, we do not expect these duties will materially affect our ability to complete our initial business combination. Our amended and restated certificate of incorporation will provide that we renounce our expectancy in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue. We believe that potential conflicts with IPI are naturally mitigated by the differing nature of the investments IPI would typically consider most synergistic to the existing IPI businesses and the types of transactions we expect to find most attractive based, in part, on transaction size and ability to operate as a standalone public company. Notwithstanding our belief regarding natural mitigation, there may be substantial overlap between companies that would be a suitable initial business combination for us and companies that would make an attractive target for IPI and IPI and its subsidiaries may compete with us for acquisition opportunities that fall within IPI s investment objectives or strategies. A decision by IPI to pursue an opportunity would preclude us from pursuing it and could have a negative impact on our ability to complete our initial business combination. In addition, investment ideas generated within IPI may be suitable for both us and for IPI and may be directed to IPI rather than to us and IPI may take commercial steps which may have an adverse effect on us, including with respect to any target we acquire in the initial business combination. Initial Business Combination We will have up to 18 months from the closing of this offering to consummate an initial business combination. However, if we anticipate that we may not be able to complete our initial business combination within 18 months from the closing of this offering, we may, by resolution of our Board, if requested by our sponsor, extend the period of time to complete our initial business combination by an additional three month period (for a total of up to 21 months from the closing of this offering), subject to our sponsor (or its affiliates or designees) purchasing additional private placement warrants as set out below. Our stockholders will not be entitled to vote on or redeem their shares in connection with any such extension. Pursuant to the terms of our amended and restated certificate of incorporation, in order to extend the time available for us to complete our initial business combination, our sponsor (or its affiliates or designees), upon no less than five days advance notice prior to the deadline, must purchase an additional 2,000,000 private placement warrants (or 2,300,000 private placement warrants if the underwriters over-allotment option is exercised in full) and deposit the proceeds of such purchase into the trust account on or prior to the date of the deadline. Our sponsor is not obligated to extend the TABLE OF CONTENTS time for us to complete our initial business combination. In the event that we receive notice from our sponsor five days prior to the deadline of its wish for us to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the deadline. In addition, we intend to issue a press release the day after the deadline announcing whether or not the funds have been timely deposited. Our sponsor (or its affiliates or designees) has the option to accelerate its purchase of the 2,000,000 private placement warrants (or 2,300,000 private placement warrants if the underwriters over-allotment option is exercised in full) at any time following the closing of this offering and prior to the consummation of our initial business combination with the same effect of extending the time we will have to consummate an initial business combination by three months. This structure is unlike the structure of similar blank check companies, which generally are only permitted to extend the time period to complete an initial business combination in connection with an amendment to their amended and restated certificate of incorporation. For a more complete summary of the extension provision, see Proposed Business Initial Business Combination. In addition to our sponsor s ability to extend our deadline to consummate an initial business combination by three months by purchasing additional private placement warrants as described above, we may also hold a stockholder vote at any time to amend our amended and restated certificate of incorporation to modify the amount of time we will have to consummate an initial business combination (as well as to modify the substance or timing of our obligation to redeem 100% of our public shares if we have not consummated an initial business combination within the time periods described herein or with respect to any other material provisions relating to stockholders rights or pre-initial business combination activity). Our sponsor, officers and directors have agreed, pursuant to a letter agreement with us (filed as an exhibit to the registration statement of which this prospectus forms a part), that they will not propose any amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering (or up to 21 months from the closing of this offering, if we extend that time period, as described in this prospectus) or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of Class A common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable and expenses relating to the administration of the trust account released to us) divided by the number of then issued and outstanding public shares. In addition, our sponsor, directors and officers have agreed, pursuant to the letter agreement, to waive their redemption rights with respect to any founder shares and public shares held by them in connection with the completion of our initial business combination. If we are unable to complete our initial business combination within such time period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible, but not more than 10 business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes as well as expenses relating to the administration of the trust account (less up to $100,000 of interest released to us to pay dissolution expenses), divided by the number of then issued and outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our Board, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within the prescribed time period. So long as our securities are then listed on Nasdaq, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the net assets held in the trust account (net of amounts disbursed to us to pay our franchise and income taxes and excluding the amount of the deferred underwriting commissions) at the time of our initial business combination. We refer to this as the 80% of net assets test. If our Board is not able to TABLE OF CONTENTS independently determine the fair market value of the target business or businesses, we will obtain a fairness opinion from an independent investment banking firm or an independent valuation or appraisal firm with respect to the satisfaction of such criteria. While we consider it unlikely that our Board will not be able to make an independent determination of the fair market value of a target business or businesses, it may be unable to do so if the Board is less familiar or experienced with the target company s business, there is a significant amount of uncertainty as to the value of such company s assets or prospects, including if such company is at an early stage of development, operations or growth, or if the anticipated transaction involves a complex financial analysis or other specialized skills and the Board determines that outside expertise would be helpful or necessary in conducting such analysis. Since any opinion, if obtained, would merely state that the fair market value of the target business meets the 80% of net assets threshold, unless such opinion includes material information regarding the valuation of a target business or the consideration to be provided, it is not anticipated that copies of such opinion would be distributed to our stockholders. However, if required under applicable law, any proxy statement that we deliver to stockholders and file with the SEC in connection with a proposed transaction will include such opinion. We anticipate structuring our initial business combination so that the post-initial business combination company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-initial business combination company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or its stockholders or for other reasons, but we will only complete such initial business combination if the post-initial business combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-initial business combination company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post-initial business combination company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-initial business combination company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If the initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. In addition, we have agreed not to enter into a definitive agreement regarding an initial business combination without the prior consent of our sponsor. If our securities are not then listed on Nasdaq for whatever reason, we would no longer be required to meet the foregoing 80% of net assets test.
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and articles of association are to our memorandum and articles of association to be in effect upon completion of this offering; Companies Act are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; founder shares are to the ordinary shares initially purchased by our sponsor in a private placement prior to this offering; initial shareholders are to the holders of our founder shares prior to this offering; letter agreement refers to the letter agreement, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team are to our officers and directors; ordinary shares are to our ordinary shares, par value $0.0001 per share, which include the public shares as well as the private placement shares; private placement rights are to the rights underlying the private placement units; private placement shares are to the ordinary shares underlying the private placement units; private placement units are to the units issued to our sponsor and/or its designees in a private placement simultaneously with the closing of this offering; private placement warrants are to the warrants underlying the private placement units; public rights are to the rights sold as part of the units in this offering (whether they are subscribed for in this offering or acquired in the open market); public shares are to our ordinary shares offered as part of the units in this offering (whether they are subscribed for in this offering or acquired thereafter in the open market); public shareholders are to the holders of our public shares; public warrants are to the redeemable warrants sold as part of the units in this offering (whether they are subscribed for in this offering or acquired in the open market); rights are to our rights, which include the public rights as well as the private placement rights to the extent they are no longer held by the initial purchasers of the private placement units or their permitted transferees; sponsor are to Bright Winlong LLC, a Cayman Islands limited liability company; of which Zhifan Zhou, our Chairman and Chief Executive Officer, serves as manager; warrants are to our redeemable warrants, which include the public warrants as well as the private placement warrants; and we, us, company, or our company are to Hainan Manaslu Acquisition Corp., a Cayman Islands exempted company; 1 Table of Contents All references in this prospectus to our founder shares being forfeited shall take effect as surrenders for no consideration of such shares as a matter of Cayman Islands law. Registered trademarks referred to in this prospectus are the property of their respective owners. General We are a blank check company newly incorporated as a Cayman Islands exempted company and formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our business combination. We have generated no revenues to date, and we do not expect that we will generate operating revenues at the earliest until we consummate our initial business combination. We have not identified any specific business combination target and we have not, nor has anyone on our behalf, initiated any discussions, directly or indirectly, to identify any business combination target. While we may pursue an acquisition opportunity in any business, industry, sector or geographical location, we intend to focus on industries that complement our management team s background, and to capitalize on the ability of our management team and advisor to identify and acquire a business. However, we will not consummate our initial business combination with an entity or business with China operations consolidated through a VIE structure. As a result, this may limit the pool of acquisition candidates we may acquire in China, in particular, due to the relevant PRC laws and regulations against foreign ownership of and investment in certain assets and industries, known as restricted industries, which including but not limited to, for example, value added telecommunications services (except for e-commerce, domestic multiparty communications, store-and-forward services, call centres). Further, due to (i) the risks associated with acquiring and operating a business in the PRC and/or Hong Kong, (ii) the fact that our principal executive offices are located in China, and (iii) the fact that all of our executive officers and directors are located in or have significant ties to China, it may make us a less attractive partner to certain potential target businesses, including non-China- or non-Hong Kong-based target companies, which may make it more difficult for us to consummate a business combination in the PRC or Hong Kong. Our Management Team Our management team has broad skills and experience relevant to our business strategy, as well as their extensive experience of identifying, investing, growing and operating businesses in diverse sectors. Our management team also has extensive governance, regulatory and public company leadership experience. We believe our competitive advantages include the experience of our management team in technology, strategic investments and finance, as well as its significant relationships worldwide in public and private industry. Mr. Zhifan Zhou, has served as our Chief Executive Officer and Chairman of our Board of Directors since November 2021. Mr. Zhou has over ten years of experience in investment banking, audit, private equity and mergers and acquisitions. Mr. Zhou has served as the General Manager of Hainan Winlong Capital, an investment company, since April 2021, where he leads the mergers and acquisitions operations. Prior to that, Mr. Zhou served as Vice President and General Manager of Capital Operations of Shanzhinong Co., Ltd., a B2B e-commerce platform company, from March 2020 to April 2021, where he was responsible for acquiring assets of the agricultural sector in China. He also served as the Head of Finance Department of Wanda Information Stock Co., Ltd., a software company, from December 2019 to March 2020, where he was responsible for due diligence and integration of wholly-owned subsidiaries; Deputy General Manager of Xinghe Real Estate Financial Group Shanghai Company, a financial group company, from March 2018 to June 2019, where he was responsible for platform financing; Deputy General Manager of Cefc Anhui Internal Holding Co., Ltd., an investment company, from October 2014 to March 2018, where he participated in various mergers and acquisitions; and Senior Project Manager in the investment banking department of Zheshang Securities Co., Ltd., a securities company, from June 2013 to October 2014, where he participated in multiple mergers and acquisitions. From September 2010 to June 2013, Mr. Zhou served as Senior Consultant of PricewaterhouseCooper Consultants (Shenzhen) Co., Ltd., Shanghai branch, a consulting company where he provided risk management and internal control services and was experienced with cross-border initial public offering, or IPO, audits. Mr. Wenyi Shen, has served as our Chief Financial Officer since November 2021. Mr. Shen has over ten years of experience in investment banking, audit and private equity investments. During his career, he provided audit services to several large-scale IPOs of Chinese companies, including Agricultural Bank of China and Haitong 2 Table of Contents Securities Co, Ltd., in Hong Kong and Chinese stock markets and focused on several industries including consumer, entertainment, education, and Internet. From May 2018 to August 2021, Mr. Shen served as Vice President for CITIC Culture Capital Management Co., Ltd., an investment company where he was responsible for growth range private equity investments. Mr. Shen served as Vice President for TFTR Investment Co., Ltd., an investment company, from February 2016 to April 2018, where he was responsible for growth range private equity investments. Mr. Shen co-founded Shanghai Yuexing Information Technology Co., Ltd., a start-up mobile travel agent company, where he served as a Chief Strategy Officer from February 2015 to January 2016 and was responsible for the company s strategy, product development, market operation and capital funding. Prior to that, Mr. Shen was an Associate at E.J. McKay Co., Ltd., a boutique investment banking firm focusing on cross-border mergers and acquisitions between China and the United States, from June 2013 to February 2015, where he participated in cross-border mergers and acquisitions investment banking activities; and a Senior Auditor at Deloitte Touche Tohmastu CPA Ltd., an accounting firm, from July 2010 to May 2013, where he participated in the audit of large financial institutions. Mr. Xun Zhang, has served as our Chief Investment Officer and Director since November 2021. Mr. Zhang has 16 years of experience in financial industries. Mr. Zhang s professional experience includes private equity, investment banking, and hedge fund. During his career, he provided equity financing, debt financing, mergers and acquisitions and other consulting services for a number of Chinese listed companies in Chinese stock markets, as well as wealth management consulting services for high net worth clients in China. Mr. Zhang serves as the General Manager of the investment department of Zhejiang Venture Investment Group Co., Ltd., a venture capital investment company in Hangzhou, China, where he was responsible for project development, investment and management. Prior to that, Mr. Zhang served as Managing Director of WXZF Fund Management Co., Ltd., a fund management company in Shanghai, China, from October 2017 to December 2019, where he developed and executed investment strategies; Risk Management Director of Gesheng Fund of Shanghai SIIC Fund Management Co., Ltd., a fund management company, from August 2015 to October 2017, where he was responsible for risk management framework establishment; Deputy General Manager of the equity capital market department of Zheshang Securities Co., Ltd., a securities company, from December 2011 to July 2015, where he was responsible for executing IPOs and private placement transactions and a Senior Financial Analyst in the risk management department of Globus LLP in Toronto, Canada, a hedge fund company, from June 2005 to August 2010, where he provided support to trading team. Mr. John Roumeliotis, will serve as our director commencing on the date of this prospectus. Since early 2009, Mr. Roumeliotis has served as a Creative Director and Chief Financial Officer and of LongKey Software Ltd., a software company based in of Wuxi, Jiangsu Province of China, where he manages financial systems and financial strategic planning and the Chief Operation Officer of Jinaxiaoer FinVisor, a public relationship company, where he led a team with initial tasks of building and promoting the company s brand and corporate image for the banking industry and government online service sectors. From June 1992 to December 2008, Mr. Roumeliotis opened and managed BuyDesign Inc., a marketing firm which later changed its name to BlackInk Communication Inc. in 1995. From September 1990 to January 1992, Mr. Roumeliotis served as an Executive Manager in Rooms Division of the InterContinental Hotel in Montreal where he initially handled project management, overseeing the final stages of construction. Mr. Roumeliotis began his career in the hotel industry in 1978 while still in school. From 1978 to August 1990, he successively served as a Night Manager and a Front Office Manager in Chateau Champlain Hotel (Now the Marriott) in Montreal and Delta Montreal Hotel. Mr. Kun-lin Liu, will serve as our director commencing on the date of this prospectus. Mr. Liu is a well-known venture capitalist in Greater China and has been engaged in venture capital investment for more than 20 years. Mr. Liu has served as a Partner of Capital First Partners, a venture capital company, since July 2019, where he focuses on deal sourcing in Taiwan. Prior to that, he served as the Chief Strategy Officer of Shanghai Vargo Technology Co., Ltd., a smart phone company, from December 2013 to January 2017, where he set up supply chain network. Mr. Liu was a former partner of Fortune International Partners, a venture capital company in Greater China, from May 2006 to May 2010, where he was responsible for investment in mainland China. Mr. Liu has also been an Industry Consultant for Taiwan Venture Capital Association and Angel Association since April 2010. He was an investor of Lakala Payment Co., Ltd., a third-party payment company, in 2007 and served as a director in the board of Lakala from 2007 to 2010. His most successful investment is Transmedia Communications Inc., a multimedia equipment maker which was acquired by Cisco Systems, Inc. in 1999. 3 Table of Contents Professor Hong Ma, will serve as our director commencing on the date of this prospectus. Professor Ma has almost 40 years of experience in law. Professor Ma has served as the Dean of Zhejiang College of Shanghai University of Finance and Economics since January 2016. He is also a professor of School of Law of Shanghai University of Finance and Economics since July 1983, and has served as the Chairman and General Manager (President) of Shanghai University of Finance and Economics Press from November 2014 to January 2016. Notwithstanding the foregoing, our officers and directors are not required to commit their full time to our affairs and will allocate their time to other businesses, which may result in a conflict of interest in allocating their time between our operations and our search for a business combination and their other businesses. We presently expect each of our officers and directors will devote such amount of time as they reasonably believe is necessary to our business (which could range from only a few hours a week while we are trying to locate a potential target business to a majority of their time as we move into serious negotiations with a target business for a business combination). In addition, past performance by our management team is not a guarantee either (i) that we will be able to locate a suitable candidate for our initial business combination or (ii) of success with respect to any business combination we may consummate. You should not rely on the historical record of our management team s performance, or the performance of any other entities with which our management team is or has been affiliated, as indicative of our future performance, how an investment in our company will perform or the returns our company will, or is likely to, generate going forward. Furthermore, the members of the management team may not remain with us subsequent to the consummation of a business combination. Business Strategy Our business strategy is to identify and complete our initial business combination with a company that fits within the experiences and skills of our team. Our selection process will leverage our relationship network, industry experiences and proven deal sourcing capabilities to access a broad spectrum of differentiated opportunities, including opportunities that we expect will have significant value in a post COVID-19 market. The relationship network has been developed through our team s experience in both investing in and operating businesses in our focus industries and sectors. Upon completion of this offering, our management team will communicate with their networks of relationships to articulate the parameters for our search for a target company and a potential business combination and begin the process of pursuing and reviewing potential opportunities. We believe that our team is well positioned to identify attractive business combination opportunities with a compelling industry backdrop and an opportunity for transformational growth. Our objectives are to generate attractive returns for shareholders and enhance value through improving performance of the acquired company and possibly providing access to needed growth capital. We expect to favor opportunities with certain industry and business characteristics. Such key characteristics include stable historical long-term growth promising future opportunities, strong competitive advantages, opportunities in leveraging the emerging social media and e-commerce platforms, opportunities for benefiting from a high potential growth from young generation consumers, and capability to adopt advanced technologies. Through our relationship network and team s experience in business investment as well as operation, we aim to focus on targets with high growing potentials in post COVID-19 market including: Companies with products and services targeting massive consumer segments with high potential growth and solid existing business performance; Platform based business driven by cutting-edge technologies and emerging social media channels; Products and services targeting young generation (also known as generation Z or Gen-Z) consumers with unique selling points and market positioning; Scalable business model with prompt free cash flow; and A track record of delivering operation efficiencies and financial performance by experienced management team. 4 Table of Contents Business Combination Criteria Our intent is to seek potential target businesses globally. We intend to accomplish this using a global network of professional contacts that has been developed by our management team over many years. This network encompasses private equity firms, venture capitalists and entrepreneurs. Our sourcing methodology includes pre-screening steps that we believe will lead to fruitful negotiating phases and final agreement. Consistent with our business strategy, we have established criteria that we believe are important in evaluating prospective target businesses. We will use these criteria in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. We intend to seek to acquire companies based on the following criteria and guidelines: Target Size. We intend to seek one or more businesses with high growth in revenue, specifically with a total enterprise value of between $200,000,000 and $500,000,000. High Growth Industry Sectors. We intend to seek to acquire one or more businesses with clear strategies in high growth industries. We believe the companies in the following sectors will benefit from industry growth and be attractive to capital market. Such sectors include: high technology, e-commerce, consumer and retail, brands management, internet application, Software as a Service ( SaaS ) and Platform as a Service ( PaaS ), health care products and social media. High Growth Geographic Markets. We intend to seek companies located in high growth geographic markets. Also, we intend to focus on companies that operate their business internationally with capabilities and experience to transfer or leverage different advantages from each market. Proven Financial Records and Growth Potential. We intend to seek to acquire one or more businesses with revenue growth in the last two or three years which have proven to be a healthy and sustainable business. We intend to focus on such businesses with high growth potential in revenue and profit through existing and planned new products, technology development and application, new sales channels and new brands, cost transfer with significant expense reduction and acquisitions with significant synergistic effect. Unique Competitiveness. We intend to seek companies with unique competitive edge including comprehensive industry know-how, advanced technologies, unique consumer understanding, existing leading position, exclusive or long-term business terms, household brand image or special cost advantages. Benefit from Being a Public Company. We intend to seek to acquire one or more businesses that will benefit from being publicly-traded and can effectively utilize the broader access to capital and the public profile that are associated with being a publicly traded company. Experienced and Visionary Management Team. We intend to seek to acquire one or more businesses established by an experienced and visionary management team with deep industry experience or diverse skillsets which help them build a successful company. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors, and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation materials or tender offer documents that we would file with the U.S. Securities and Exchange Commission (the SEC ). Sourcing of Potential Business Combination Targets Our management team has developed a broad network of contacts and corporate relationships. We believe that the network of contacts and relationships of our management team and our sponsor will provide us with an important source of business combination opportunities. In addition, we anticipate that target business candidates will be brought to our attention from various unaffiliated sources, including investment banking firms, private equity firms, 5 Table of Contents consultants, accounting firms and business enterprises. We are not prohibited from pursuing a business combination with a company that is affiliated with our sponsor, officers or directors, or completing the business combination through a joint venture or other form of shared ownership with our sponsor, officers or directors. As more fully discussed in Management Conflicts of Interest, if any of our officers or directors becomes aware of a business combination opportunity that falls within the line of business of any entity to which he or she has then-existing fiduciary or contractual obligations, he or she may be required to present such business combination opportunity to such entity prior to presenting such business combination opportunity to us. In evaluating a prospective target business, we expect to conduct an extensive due diligence review which may encompass, as applicable and among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities and a review of financial and other information about the target and its industry. We will also utilize our management team s operational and capital planning experience. Unless we complete our initial business combination with an affiliated entity, or our Board of Directors cannot independently determine the fair market value of the target business or businesses, we are not required to obtain an opinion from an independent investment banking firm, another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or from an independent accounting firm that the price we are paying for a target is fair to our company from a financial point of view. If no opinion is obtained, our shareholders will be relying on the business judgment of our Board of Directors, which will have significant discretion in choosing the standard used to establish the fair market value of the target or targets, and different methods of valuation may vary greatly in outcome from one another. Such standards used will be disclosed in our tender offer documents or proxy solicitation materials, as applicable, related to our initial business combination. Members of our management team may directly or indirectly own our ordinary shares and/or private placement units following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Other than our Chief Financial Officer, each of our directors and officers presently has, and in the future any of our directors and our officers may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present acquisition opportunities to such entity. Accordingly, subject to his or her fiduciary duties under Cayman Islands law, if any of our officers or directors becomes aware of an acquisition opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she will need to honor his or her fiduciary or contractual obligations to present such acquisition opportunity to such entity, and only present it to us if such entity rejects the opportunity. Our amended and restated memorandum and articles of association will provide that, subject to his or her fiduciary duties under Cayman Islands law, we renounce our interest in any corporate opportunity offered to any officer or director unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue. We do not believe, however, that any fiduciary duties or contractual obligations of our directors or officers would materially undermine our ability to complete our business combination. Potential Approvals from the PRC Governmental Authorities for this Offering or a Business Combination The Regulations on Mergers and Acquisitions of Domestic Companies by Foreign Investors (the M&A Rules ), adopted by six PRC regulatory agencies in 2006 and amended in 2009, require an offshore special purpose vehicle formed for the purpose of an overseas listing of securities in a PRC company to obtain the approval of the China Securities Regulatory Commission (the CSRC ) prior to the listing and trading of such special purpose vehicle s securities on an overseas stock exchange. However, substantial uncertainty remains regarding the scope and applicability of the M&A Rules to offshore special purpose vehicles. 6 Table of Contents Recently, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointly issued the Opinions on Strictly Cracking Down on Illegal Securities Activities According to Law (the Opinions ), which call for strengthened regulation over illegal securities activities and supervision on overseas listings by China-based companies and propose to take effective measures, such as promoting the development of relevant regulatory systems to deal with the risks and incidents faced by China-based overseas-listed companies. While the application of the M&A Rules remains unclear, no official guidance and related implementation rules have been issued in relation to the Opinions, and the interpretation and implementation of the Opinions also remain unclear at this stage, based on our understanding of the current PRC laws and regulations in effect at the time of this prospectus, no prior permission is required under the M&A Rules or the Opinions from any PRC governmental authorities (including the CSRC) for consummating this offering by our company. However, there can be no assurance that the relevant PRC governmental authorities, including the CSRC, would reach the same conclusion as us, or that the CSRC or any other PRC governmental authorities would not promulgate new rules or new interpretation of current rules to require us to obtain CSRC or other PRC governmental approvals for this offering or for the business combination if we decide to consummate the business combination with a target business based in and primarily operating in China. See Risk Factors Risks Associated with Acquiring and Operating a Business in China The PRC governmental authorities may take the view now or in the future that an approval from them is required for an overseas offering by a company affiliated with Chinese businesses or persons or a business combination with a target business based in and primarily operating in China. We currently do not hold any equity interest in any PRC company or operate any business in China. Therefore, we do not believe we are required to obtain any permission from any PRC governmental authorities to operate our business as currently conducted or to conduct this offering and offer securities to foreign investors. We have been closely monitoring regulatory developments in China regarding any necessary approvals from the CSRC or other PRC governmental authorities required for overseas listings, including this offering and a potential business combination with a target business based in and primarily operating in China. As of the date of this prospectus, we have not received any inquiry, notice, warning, sanctions or regulatory objection to this offering from the CSRC or any other governmental authorities. However, there remains significant uncertainty as to the enactment, interpretation and implementation of regulatory requirements related to overseas securities offerings and other capital markets activities. If it is determined in the future that the approval of the CSRC, The Cyberspace Administration of China (the CAC ) or any other regulatory authority is required for this offering, we or our post-business combination company may face sanctions by the CSRC, the CAC or other PRC regulatory agencies. These regulatory agencies may impose fines and penalties on our operations in China, limit our ability to pay dividends outside of China, limit our operations in China, delay or restrict the repatriation of the proceeds from this offering into China or take other actions that could have a material adverse effect on our business, financial condition, results of operations and prospects, as well as the trading price of our securities. The CSRC, the CAC or other PRC regulatory agencies also may take actions requiring us, or making it advisable for us, to halt this offering before settlement and delivery of our units. Consequently, if you engage in market trading or other activities in anticipation of and prior to settlement and delivery, you do so at the risk that settlement and delivery may not occur. In addition, if the CSRC, the CAC or other regulatory PRC agencies later promulgate new rules requiring that we obtain their approvals for this offering, we may be unable to obtain a waiver of such approval requirements, if and when procedures are established to obtain such a waiver. Any uncertainties and/or negative publicity regarding such an approval requirement could have a material adverse effect on the trading price of our securities. Funds Flow to and from our Potential PRC Subsidiaries (Post Business Combination) If we decide to consummate our initial business combination with a target business based in and primarily operating in China, the combined company whose securities will be listed on a U.S. stock exchange may make capital contributions or extend loans to its PRC subsidiaries through intermediate holding companies subject to compliance with relevant PRC foreign exchange control regulations. After the business combination, the combined company s ability to pay dividends, if any, to the shareholders and to service any debt it may incur will depend upon dividends paid by its PRC subsidiaries which are entitled to substantially all of the economic benefits. Under PRC laws and regulations, PRC companies are subject to certain restrictions with respect to paying dividends or otherwise transferring any of their net assets to offshore entities. In particular, under the current PRC laws and regulations in effect at the time of this prospectus, dividends may be paid only out of distributable profits. Distributable profits are the net profit as determined under Chinese accounting standards and regulations, less any recovery of accumulated 7 Table of Contents losses and appropriations to statutory and other reserves required to be made. A PRC company is required to set aside at least 10% of its after-tax profits each year to fund certain statutory reserve funds (up to an aggregate amount equal to half of its registered capital). Entities in China may also be required to further set aside a portion of their after-tax profits to fund the employee welfare fund, although the amount to be set aside, if any, is determined at the discretion of its board of directors. Although the statutory reserves can be used, among other ways, to increase the registered capital and eliminate future losses in excess of retained earnings of the respective companies, the reserve funds are not distributable as cash dividends except in the event of liquidation. As a result, the combined company s PRC subsidiaries may not have sufficient distributable profits to pay dividends to the combined company. Furthermore, if certain procedural requirements are satisfied, the payment in foreign currencies on current account items, including profit distributions and trade and service related foreign exchange transactions, can be made without prior approval from State Administration of Foreign Exchange (the SAFE ) or its local branches. However, where RMB is to be converted into foreign currency and remitted out of China to pay capital expenses, such as the repayment of loans denominated in foreign currencies, approval from or registration with competent government authorities or its authorized banks is required. The PRC government may take measures at its discretion from time to time to restrict access to foreign currencies for current account or capital account transactions. If the foreign exchange control regulations prevent the PRC subsidiaries of the combined company from obtaining sufficient foreign currencies to satisfy their foreign currency demands, the PRC subsidiaries of the combined company may not be able to pay dividends or repay loans in foreign currencies to their offshore intermediary holding companies and ultimately to the combined company. We cannot assure you that new regulations or policies will not be promulgated in the future, which may further restrict the remittance of RMB into or out of the PRC. We cannot assure you, in light of the restrictions in place, or any amendment to be made from time to time, that the PRC subsidiaries of the combined company will be able to satisfy their respective payment obligations that are denominated in foreign currencies, including the remittance of dividends outside of the PRC. See Risk Factors Risks Associated with Acquiring and Operating a Business in China Governmental control of currency conversion may limit the ability of our operating companies in China to utilize their revenues effectively and affect the value of your investment and Risk Factors Risks Associated with Acquiring and Operating a Business in China If we enter into a business combination with a target business operating in China, PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may delay or prevent the combined company from using the proceeds from the business combination to make loans to or make additional capital contributions to its PRC subsidiaries, which could materially and adversely affect PRC operating companies liquidity and ability to fund the operations. As an offshore holding company, if we acquire a target company that operates its business in China, we may use the proceeds of our offshore fund-raising activities to provide loans or make capital contributions to the PRC subsidiaries of the combined company, in each case subject to applicable regulatory requirements. The PRC subsidiaries may pay dividends to us out of their retained earnings. As of the date of this prospectus, we have not made any dividends or distributions to our shareholders. We do not intend to distribute earnings or settle amounts owed until after the closing of the business combination. Implication of the Holding Foreign Companies Accountable Act The Holding Foreign Companies Accountable Act, or the HFCA Act, was enacted on December 18, 2020. The HFCA Act states that if the SEC determines that an issuer s audit reports issued by a registered public accounting firm have not been subject to inspection by the PCAOB for three consecutive years beginning in 2021, the SEC shall prohibit such issuer s securities from being traded on a national securities exchange or in the over-the-counter trading market in the United States. If we decide to consummate our initial business combination with a target business based in and primarily operating in China, auditors of the combined company and their workpapers may be located in China, a jurisdiction where the PCAOB has been unable to conduct inspections without the approval of the PRC authorities. Therefore, the combined company s securities may be delisted from a national securities exchange in the U.S pursuant to the HFCA Act. Furthermore, on June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act, which, if signed into law, would amend the HFCA Act and require the SEC to prohibit an issuer s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three consecutive years. See Risk Factors Risks Associated with Acquiring and Operating a Business in China Certain existing or future U.S. laws and regulations may restrict or eliminate our ability to complete a business combination with certain companies, particularly those target companies in China. 8 Table of Contents Recent PCAOB Developments The PCAOB is currently unable to conduct inspections on accounting firms in the PRC or Hong Kong without the approval of the relevant government authorities. The auditor and its audit work in the PRC or Hong Kong may not be inspected fully by the PCAOB. Inspections of other auditors conducted by the PCAOB outside China have at times identified deficiencies in those auditors audit procedures and quality control procedures, which may be addressed as part of the inspection process to improve future audit quality. The lack of PCAOB inspections of audit work undertaken in China or Hong Kong prevents the PCAOB from regularly evaluating the PRC auditor s audits and its quality control procedures. As a result, shareholders may be deprived of the benefits of PCAOB inspections if we complete a business combination with such companies. The documentation we may be required to submit to the SEC proving certain beneficial ownership requirements and establishing that we are not owned or controlled by a foreign government in the event that we use a foreign public accounting firm not subject to inspection by the PCAOB or where the PCAOB is unable to completely inspect or investigate our accounting practices or financial statements because of a position taken by an authority in the foreign jurisdiction could be onerous and time consuming to prepare. The HFCA Act mandates the SEC to identify issuers of SEC-registered securities whose audited financial reports are prepared by an accounting firm that the PCAOB is unable to inspect due to restrictions imposed by an authority in the foreign jurisdiction where the audits are performed. If such identified issuer s auditor cannot be inspected by the PCAOB for three consecutive years, the trading of such issuer s securities on any U.S. national securities exchanges, as well as any over-the-counter trading in the U.S., will be prohibited. On March 24, 2021, the SEC adopted interim final rules relating to the implementation of certain disclosure and documentation requirements of the HFCA Act. An identified issuer will be required to comply with these rules if the SEC identifies it as having a non-inspection year under a process to be subsequently established by the SEC. On November 5, 2021, the SEC approved the PCAOB s Rule 6100, Board Determinations Under the Holding Foreign Companies Accountable Act. Rule 6100 provides a framework for the PCAOB to use when determining, as contemplated under the HFCA Act, whether it is unable to inspect or investigate completely registered public accounting firms located in a foreign jurisdiction because of a position taken by one or more authorities in that jurisdiction. On December 2, 2021, the SEC issued amendments to finalize rules implementing the submission and disclosure requirements in the HFCA Act. The rules apply to registrants that the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located in a foreign jurisdiction and that PCAOB is unable to inspect or investigate completely because of a position taken by an authority in foreign jurisdictions. On December 16, 2021, the PCAOB issued a Determination Report which found that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in: (i) China, and (ii) Hong Kong. Our auditor, headquartered in New York, NY, is an independent registered public accounting firm with the PCAOB and has been inspected by the PCAOB on a regular basis. The PCAOB currently has access to inspect the working papers of our auditor. Our auditor is not headquartered in China or Hong Kong and was not identified in this report as a firm subject to the PCAOB s determination. In the event that we complete a business combination with a company with substantial operations in China and PCAOB is not able to fully conduct inspections of our auditor s work papers in China, it could cause us to fail to be in compliance with U.S. securities laws and regulations, we could cease to be listed on a U.S. securities exchange, and U.S. trading of our shares could be prohibited under the HFCA Act. Any of these actions, or uncertainties in the market about the possibility of such actions, could adversely affect our prospects to successfully complete a business combination with a China or Hong Kong-based company, our access to the U.S. capital markets and the price of our shares. Future developments in respect of increased U.S. regulatory access to audit information are uncertain, as the legislative developments are subject to the legislative process and the regulatory developments are subject to the rule-making process and other administrative procedures. 9 Table of Contents Other developments in U.S. laws and regulatory environment, including but not limited to executive orders such as Executive Order (E.O.) 13959, Addressing the Threat from Securities Investments That Finance Communist Chinese Military Companies, may further restrict our ability to complete a business combination with certain China-based businesses For more detailed information, see Risk Factors Risks Associated with Acquiring and Operating a Business in China Certain existing or future U.S. laws and regulations may restrict or eliminate our ability to complete a business combination with certain companies, particularly those target companies in China. Initial Business Combination We will have until nine months from the closing of this offering to consummate our initial business combination. However, if we anticipate that we may not be able to consummate our initial business combination within nine months, we may, by resolution of our board if requested by our sponsor, extend the period of time to consummate a business combination up to nine times, each by an additional one month (for a total of up to 18 months to complete a business combination), subject to the sponsor depositing additional funds into the trust account as set out below. Pursuant to the terms of our amended and restated memorandum and articles of association and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order for the time available for us to consummate our initial business combination to be extended, our sponsor or its affiliates or designees, upon five days advance notice prior to the applicable deadline, must deposit into the trust account $198,000 or $227,700 if the underwriters over-allotment option is exercised in full (approximately $0.033 per public share in either case) on or prior to the date of the applicable deadline, for each one month extension (up to an aggregate of $1,782,000 (or $2,049,300 if the underwriters over-allotment option is exercised in full), or $0.297 per public share, for an aggregate of nine months). In the event that we receive notice from our sponsor five days prior to the applicable deadline of its wish for us to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the applicable deadline announcing whether or not the funds had been timely deposited. If we are unable to consummate our initial business combination within the applicable time period, we will, as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares for a pro rata portion of the funds held in the trust account and as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our Board of Directors, dissolve and liquidate, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. In such event, the warrants and rights will be worthless. Our sponsor may extend the time frame by the company to complete a business combination up to an additional nine months to complete a business combination by depositing the required amount of funds for each monthly extension. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. Holders of our securities will not have to right to approve or disapprove any such monthly extension. Further, holders of our securities will not have the right to seek or obtain redemption in connection with any extension of the time frame to complete a business combination. Any such payments from our sponsor and its affiliates or designees to extend the time frame would be made in the form of a loan from our sponsor to the company. The final and definitive terms of the loan in connection with any such loans have not yet been negotiated, but any such loan would be interest free and not repaid unless and until we complete a business combination. If we complete our initial business combination, we will, at the option of our sponsor, repay such loaned amounts out of the proceeds of the trust account released to us or convert a portion or all of the total loan amount into units at a price of $10.00 per unit, which units will be identical to the private placement units. If we do not complete a business combination, we will repay such loans only from funds held outside of the trust account, if any such funds are available. We currently believe we will not have sufficient funds left outside of the trust account to pay back such loans if our initial business combination is not completed. In the event that we receive notice from our sponsor five days prior to the deadline of its intention for us to effect an extension, we will issue a press release announcing such intention at least three days prior to the deadline. In addition, we will issue a press release the day after the deadline announcing whether or not the funds had been timely deposited. 10 Table of Contents The Nasdaq rules require that our initial business combination must be with one or more target businesses that together have an aggregate fair market value equal to at least 80% of the balance in the trust account (less any deferred underwriting commissions and taxes payable on interest earned) at the time of our signing a definitive agreement in connection with our initial business combination. If our Board of Directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or an independent accounting firm. Additionally, pursuant to the Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. If we are delisted from Nasdaq prior to completion of the business combination, the Nasdaq 80% requirement would no longer be applicable. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. The determination of whether or not to acquire less than 100% of the equity interests or assets will be dependent upon numerous factors, including satisfaction certain objectives of the target management team or target s shareholders, the costs of any such proposed acquisition or for other reasons, many of which we cannot determine at this time and will be contingent upon negotiations with prospective targets. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete a business combination for equity interests if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target or in the event of an Assets Acquisition, an Acquisition which results in an Operating business line, sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. In considering an asset transaction, we would acquire such assets only if we could constitute from such assets a stand-alone operating business. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of Nasdaq net assets test. If our initial business combination involves more than one target business or assets from different business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. Corporate Information We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. 11 Table of Contents We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates equals or exceeds $250 million as of the end of the second fiscal quarter of such fiscal year, or (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates equals or exceeds $700 million as of the end of the second fiscal quarter of such fiscal year. Exempted companies are Cayman Islands companies wishing to conduct business outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (as Revised) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations shall apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax shall be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are a Cayman Islands exempted company incorporated on September 10, 2021. Our executive offices are located at B3406, 34F, West Tower, Block B, Guorui Building, 11 Guoxing Avenue, Haikou, Hainan Province, People s Republic of China 570203, and our telephone number is +86-898-65315786. 12 Table of Contents THE OFFERING In making your decision whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors beginning on page 40 of this prospectus. Securities offered 6,000,000 units, at $10.00 per unit, each unit consisting of: one ordinary share; one warrant, each warrant exercisable to purchase one ordinary share; and one right to receive one-tenth of one ordinary share upon consummation of our initial business combination. Proposed Nasdaq symbols Units: HMACU Ordinary shares: HMAC Warrants: HMACW Rights: HMACR Trading commencement and separation of ordinary shares, warrants and rights The units will begin trading promptly after the date of this prospectus. The ordinary shares, warrants and rights comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Ladenburg Thalmann & Co. Inc. ( Ladenburg Thalmann ), the representative of the underwriters, informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the ordinary shares, warrants and rights commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into ordinary shares, warrants and rights. Separate trading of the ordinary shares, warrants and rights is prohibited until we have filed a Current Report on Form 8-K In no event will the ordinary shares, warrants and rights be traded separately until we have filed with the SEC a Current Report on Form 8-K which includes an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which is anticipated to take place three business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. 13 Table of Contents Units: Number outstanding before this offering 0 Number outstanding after this offering and the private placement 6,310,000(1) Ordinary shares: Number issued and outstanding before this offering 1,725,000(2) Number issued and outstanding after this offering and the private placement 7,810,000(1)(3) Redeemable Warrants: Number outstanding before this offering 0 Number of warrants to be outstanding after this offering and the private placement 6,310,000(1)(4) Rights: Number outstanding before this offering 0 Number of rights to be outstanding after this offering and the private placement 6,310,000(1) Terms of the warrants Exercisability Each warrant is exercisable to purchase one ordinary share. Exercise price $11.50 per share, subject to adjustment as described herein. In addition, if (x) we issue additional ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per ordinary share (with such issue price or effective issue price to be determined in good faith by our Board of Directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares, private placement units, or units upon conversion of working capital loans or extension loans held by our sponsor or such affiliates, as applicable, prior to such issuance) (the Newly Issued Price ), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our ordinary shares during the 20 trading day period starting on the trading day prior to ____________ (1) Assumes no exercise of the underwriters over-allotment option and the forfeiture by our sponsor of 225,000 founder shares. (2) Consists solely of founder shares and includes up to 225,000 ordinary shares that are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised. Except as otherwise specified, the rest of this prospectus has been drafted to give effect to the full forfeiture of these 225,000 ordinary shares. (3) Includes 6,000,000 public shares, 310,000 private placement shares and 1,500,000 founder shares. (4) Includes 6,000,000 public warrants included in the units sold in this offering and 310,000 private placement warrants underlying the private placement units to be sold in the private placement. 14 Table of Contents the day on which we consummate our initial business combination (such price, the Market Value ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price described below under Redemption of warrants will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. Exercise period The warrants will become exercisable upon the completion of our initial business combination, provided that we have an effective registration statement under the Securities Act covering the ordinary shares issuable upon exercise of the warrants and a current prospectus relating to them is available (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). We are registering the ordinary shares issuable upon exercise of the warrants in the registration statement of which this prospectus forms a part because the warrants will become exercisable upon the completion of our initial business combination, which may be within one year of this offering. However, because the warrants will be exercisable until their expiration date of up to five years after the completion of our initial business combination, in order to comply with the requirements of Section 10(a)(3) of the Securities Act following the consummation of our initial business combination, we have agreed that as soon as practicable, but in no event later than 15 business days after the closing of our initial business combination, we will use our best efforts to file with the SEC a post-effective amendment to this registration statement or a new registration statement, under the Securities Act, covering the ordinary shares issuable upon exercise of the warrants, and we will use our best efforts to cause the same to become effective within 60 business days after the closing of our initial business combination, and to maintain the effectiveness of such registration statement and a current prospectus relating to those ordinary shares until the warrants expire or are redeemed, as specified in the warrant agreement. No warrants will be exercisable for cash unless we have an effective and current registration statement covering the ordinary shares issuable upon exercise of the warrants and a current prospectus relating to such ordinary shares. Notwithstanding the foregoing, if a registration statement covering the ordinary shares issuable upon exercise of the warrants is not effective within a specified period following the consummation of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to the exemption provided by Section 3(a)(9) of the Securities Act of 1933, as amended, or the Securities Act, provided that such exemption is available. If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a cashless basis. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. 15 Table of Contents Redemption of warrants Once the warrants become exercisable, we may redeem the outstanding warrants: in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period; and if, and only if, the last sale price of our ordinary shares equals or exceeds $18.00 per share (as adjusted for share capitalizations, rights issuances, subdivisions, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. We will not redeem the warrants unless a registration statement under the Securities Act covering the ordinary shares issuable upon exercise of the warrants is effective and a current prospectus relating to those ordinary shares is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may not exercise our redemption right if the issuance of shares upon exercise of the warrants is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect such registration or qualification. We will use our best efforts to register or qualify such shares under the blue sky laws of the state of residence in those states in which the warrants were offered by us in this offering. If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In determining whether to require all holders to exercise their warrants on a cashless basis, our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our shareholders of issuing the maximum number of ordinary shares issuable upon the exercise of our warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of ordinary shares equal to the quotient obtained by dividing (x) the product of the number of ordinary shares underlying the warrants, multiplied by the excess of the fair market value (defined below) over the exercise price of the warrants by (y) the fair market value. The fair market value shall mean the average reported last sale price of the ordinary shares for the ten trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Please see the section entitled Description of Securities Redeemable Warrants Public Shareholders Warrants for additional information. No fractional ordinary shares will be issued upon redemption. If, upon redemption, a holder would be entitled to receive a fractional interest in a share, we will round down to the nearest whole number of the number of ordinary shares to be issued to the holder. 16 Table of Contents Terms of the rights Each holder of a right will receive one-tenth of an ordinary share upon consummation of our initial business combination. In the event we will not be the survivor upon completion of our initial business combination, each holder of a right will be required to affirmatively convert his, her or its rights in order to receive the one-tenth share underlying each right (without paying any additional consideration) upon consummation of the business combination. If we are unable to complete an initial business combination within the required time period and we liquidate the funds held in the trust account, holders of rights will not receive any of such funds for their rights and the rights will expire worthless. We will not issue fractional shares upon conversion of the rights. Fractional shares will be rounded down to the nearest whole share. As a result, you must hold rights in multiples of ten in order to receive shares for all of your rights upon closing of a business combination. Ability to extend time to complete business combination If we anticipate that we may not be able to consummate our initial business combination within nine months, we may, by resolution of our board if requested by our sponsor, extend the period of time to consummate a business combination up to nine times, each by an additional one month (for a total of up to 18 months to complete a business combination), subject to the sponsor and its affiliates or designees depositing additional funds into the trust account as set out below. Pursuant to the terms of our amended and restated memorandum and articles of association and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order for the time available for us to consummate our initial business combination to be extended, our sponsor or its affiliates or designees, upon five days advance notice prior to the applicable deadline, must deposit into the trust account $198,000 or $227,700 if the underwriters over-allotment option is exercised in full (approximately $0.033 per public share in either case) on or prior to the date of the applicable deadline, for each one month extension (up to an aggregate of $1,782,000 (or $2,049,300 if the underwriters over-allotment option is exercised in full), or $0.297 per public share, for an aggregate of nine months. Unlike many other SPAC offerings, investors in our company holding our ordinary shares will not have the right to approve any extension or seek or obtain redemption of their ordinary shares. Any such payments would be made in the form of a loan. The terms of the promissory note to be issued in connection with any such loans have not yet been negotiated, but such loans would be interest free and would be paid only if we consummate a business combination. If we complete our initial business combination, we will, at the option of our sponsor, repay such loaned amounts out of the proceeds of the trust account released to us or convert a portion or all of the total loan amount into units at a price of $10.00 per unit, which units will be identical to the private placement units. If we do not complete a business combination, we will repay such loans only from funds held outside of the trust account, if any such funds are available. We currently believe we will not have sufficient funds left outside of the trust account to pay back such loans if our initial business combination is not completed. 17 Table of Contents Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. In the event that we receive notice from our sponsor five days prior to the deadline of its intention for us to effect an extension, we will issue a press release announcing such intention at least three days prior to the deadline. In addition, we will issue a press release the day after the deadline announcing whether or not the funds had been timely deposited. Founder shares On September 29, 2021, our sponsor purchased an aggregate of 1,725,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.014 per share. Prior to the initial investment in the company of $25,000 by our sponsor, we had no assets, tangible or intangible. The purchase price of the founder shares was determined by dividing the amount of cash contributed to us by the number of founder shares issued. Our sponsor will own approximately 20.0% of our issued and outstanding shares after this offering (assuming it does not purchase units in this offering, and not taking into account ownership of the private placement units). If we increase or decrease the size of the offering, we will effect a capitalization or share surrender or redemption or other appropriate mechanism, as applicable, with respect to our ordinary shares immediately prior to the consummation of the offering in such amount as to maintain the ownership of founder shares by our sponsor at 20% of our issued and outstanding ordinary shares upon the consummation of this offering (assuming it does not purchase units in this offering and not taking into account ownership of the private placement units). Up to 225,000 founder shares are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised. The founder shares are identical to the ordinary shares included in the units being sold in this offering, except that: the founder shares are subject to certain transfer restrictions, as described in more detail below; our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed (i) to waive their redemption rights with respect to their founder shares, private placement shares and public shares in connection with the completion of our initial business combination, (ii) to waive their redemption rights with respect to any founder shares, private placement shares and public shares held by them in connection with a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if we have not consummated our initial business combination within the timeframe set forth therein or (B) with respect to any other provision relating to shareholders rights or pre-initial business combination activity and (iii) to waive their rights to liquidating distributions from the trust account 18 Table of Contents with respect to their founder shares and private placement shares if we fail to complete our initial business combination within nine months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). If we submit our initial business combination to our public shareholders for a vote, our sponsor has agreed, pursuant to such letter agreement, to vote their founder shares, private placement shares and any public shares purchased during or after this offering in favor of our initial business combination (as a result, in addition to our initial shareholder s founder shares and private placement shares, we would need only 2,110,001, or approximately 35.2% (assuming all outstanding shares are voted and no exercise of the underwriters over-allotment option) or 165,001, or 2.8% (assuming only the minimum number of shares representing a quorum are voted and no exercise of the underwriters over-allotment option), of the 6,000,000 public shares sold in this offering to be voted in favor of a transaction in order to have our initial business combination approved; and the founder shares are entitled to certain registration rights to provide for the resale of such shares under the Securities Act. Transfer restrictions on founder shares Our sponsor has agreed not to transfer, assign or sell 50% of its founder shares until the earlier of (i) six months after the date of the consummation of our initial business combination or (ii) the date on which the closing price of our ordinary shares equals or exceeds $12.50 per share (as adjusted for share subdivisions, share dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after our initial business combination. The remaining 50% of the founder shares may not be transferred, assigned or sold until six months after the date of the consummation of our initial business combination, or earlier, in either case, if, subsequent to our initial business combination, we consummate a subsequent liquidation, merger, stock exchange or other similar transaction which results in all of our shareholders having the right to exchange their ordinary shares for cash, securities or other property (except as described herein under Principal Shareholders Transfers of Founder Shares and Private Placement Units ). We refer to such transfer restrictions throughout this prospectus as the lock-up. Private placement units Our sponsor and/or its designees, have agreed to purchase an aggregate of 310,000 units (or 341,500 units if the over-allotment option is exercised in full) at a price of $10.00 per unit for an aggregate purchase price of $3,100,000 (or $3,415,000 if the over-allotment option is exercised in full), in a private placement that will close simultaneously with the closing of this offering. 19 Table of Contents Each private placement unit shall consist of one ordinary share, one warrant, and one right to receive one-tenth of an ordinary share upon the consummation of an initial business combination. Each whole private placement warrant is exercisable to purchase one ordinary share at a price of $11.50 per share, subject to adjustment as provided herein. Private placement warrants may be exercised only for a whole number of shares. A portion of the purchase price paid by the sponsor for the private placement units will be added to the net proceeds from this offering to be held in the trust account so that 101.5% of the aggregate offering proceeds are held in trust at closing. If we do not complete our initial business combination within nine months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus), the proceeds of the sale of the private placement units held in the trust account will be used to fund the redemption of our public shares (subject to the requirements of applicable law) and the private placement units and underlying securities will be worthless. Transfer restrictions on private placement units The private placement units (including the underlying securities) will not be transferable, assignable or saleable until 30 days after the completion of our initial business combination. Proceeds to be held in trust account The rules of the Nasdaq provide that at least 90% of the gross proceeds from this offering and the private placement be deposited in a trust account. Of the net proceeds we will receive from this offering and the sale of the private placement units described in this prospectus, $60,900,000 ($10.15 per public share plus a portion of the sponsor s private placement purchase), or $70,035,000 ($10.15 per public share plus a portion of the sponsor s private placement purchase) if the underwriters over-allotment option is exercised in full (subject to increase of up to an additional $0.297 per public share in the event that our sponsor elects to extend the period of time for the entire nine months to consummate a business combination, as described in more detail in this prospectus), will be deposited by our transfer agent and trustee, Continental Stock Transfer & Trust Company into a segregated trust account located in the United States and $500,000 will be used to pay expenses in connection with the closing of this offering and for working capital following this offering. The proceeds to be placed in the trust account include $1,950,000 (or up to $2,242,500 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions. The funds in the trust account will be invested only in specified U.S. government treasury bills or in specified money market funds. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, if any, the proceeds from this offering and the private placement will not be released from the trust account until the earliest of (i) the completion of our initial business combination, (ii) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association to (A) modify the substance or timing of our obligation to redeem 20 Table of Contents 100% of our public shares if we do not complete our initial business combination within nine months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) or (B) with respect to any other provision relating to shareholders rights or pre-business combination activity and (iii) the redemption of all of our public shares if we are unable to complete our initial business combination within nine months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus), subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. Anticipated expenses and funding sources Unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use, except the withdrawal of interest to pay taxes. The funds in the trust account will be invested only in U.S. government treasury bills with a maturity of 185 days or less or in money market funds investing solely in U.S. Treasuries and meeting certain conditions under Rule 2a-7 under the Investment Company Act. Based upon current interest rates, we expect the trust account to generate approximately $6,090 of interest annually (assuming no exercise of the underwriters overallotment option and an interest rate of 0.01% per year) following the investment of such funds in specified U.S. government treasury bills or in specified money market funds. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement units not held in the trust account, which will be approximately $500,000 in working capital after the payment of approximately $500,000 in expenses relating to this offering; and any loans or additional investments from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation to advance funds or invest in us, and provided any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of a business combination. If we complete our initial business combination, we expect to repay such loaned amounts out of the proceeds of the trust account released to us. In the event that our initial business combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust account would be used to repay such loaned amounts. Up to $1,500,000 of such loans may be convertible into units at a price of $10.00 per unit (which, for example, would result in the holders being issued 165,000 ordinary shares if $1,500,000 of notes were so converted (including 15,000 shares upon the closing of our initial business combination in respect of 150,000 rights included in such units), as well as 150,000 warrants to purchase 150,000 shares) at the option of the lender. 21 Table of Contents Conditions to completing our initial business combination There is no limitation on our ability to raise funds privately or through loans in connection with our initial business combination. The Nasdaq rules require that our initial business combination must be with one or more target businesses that together have an aggregate fair market value equal to at least 80% of the balance in the trust account (less any deferred underwriting commissions and taxes payable on interest earned) at the time of our signing a definitive agreement in connection with our initial business combination. Although we have had no discussions with any potential targets, we do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. In the event that Nasdaq were to delist our securities prior to us completing a business combination, we would not be subject to the 80% standard. If our Board of Directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or an independent accounting firm. We will complete our initial business combination only if the post-transaction company in which our public shareholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our initial business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test, provided that in the event that our initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. Additionally, pursuant to the Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. Permitted purchases and other transactions with respect to our securities by our affiliates If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, officers, advisors or their affiliates may purchase public shares, public warrants or public units in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Please see Proposed Business Permitted purchases of our securities for a description of how such persons will determine which shareholders to seek to acquire shares from. There is no limit on the number of shares such persons may purchase, or any restriction on the price that they may pay. Any such price per share may be different than 22 Table of Contents the amount per share a public shareholder would receive if it elected to redeem its shares in connection with our initial business combination. Additionally, at any time at or prior to our initial business combination, subject to applicable securities laws (including with respect to material nonpublic information), our initial shareholders, directors, officers, advisors or any of their affiliates may enter into transactions with investors and others to provide them with incentives to acquire public shares, vote their public shares in favor of our initial business combination or not redeem their public shares. However, such persons have no current commitments, plans or intentions to engage in such purchases or other transactions and have not formulated any terms or conditions for any such purchases or other transactions. Please see Proposed Business Permitted purchases of our securities for a description of how such persons will determine from which shareholders to purchase securities from or enter into transactions with. The purpose of any such transaction could be to (1) vote such public shares in favor of the initial business combination and thereby increase the likelihood of obtaining shareholder approval of our initial business combination, (2) reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination or (3) satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. Any such transactions may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our ordinary shares or warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. None of the funds in the trust account will be used to purchase public shares, public warrants or public units in such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. Subsequent to the consummation of this offering, we will adopt an insider trading policy which will require insiders to: (i) refrain from purchasing shares during certain blackout periods and when they are in possession of any material non-public information and (ii) to clear all trades with our legal counsel prior to execution. We cannot currently determine whether our insiders will make such purchases pursuant to a Rule 10b5-1 plan, as it will be dependent upon several factors, including but not limited to, the timing and size of such purchases. Depending on such circumstances, our insiders may either make such purchases pursuant to a Rule 10b5-1 plan or determine that such a plan is not necessary. 23 Table of Contents We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Our sponsor, directors, officers, advisors or their affiliates will not make any purchases if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. We expect that any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. Redemption rights for public shareholders upon completion of our initial business combination We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.15 per public share (subject to increase of up to an additional $0.033 per public share for each monthly extension in the event that our sponsor elects to extend the period of time to consummate a business combination, as described in more detail in this prospectus). The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants or rights. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive (i) their redemption rights with respect to their founder shares, private placement shares and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination and (ii) their redemption rights with respect to any founder shares and public shares held by them in connection with a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (a) to modify the substance or timing of our obligation to allow redemptions in connection with our initial business combination or to redeem 100% of our public shares if we have not consummated our initial business combination within the prescribed timeframe or (b) with respect to any other provision relating to shareholders rights or pre-initial business combination activity. 24 Table of Contents Manner of conducting redemptions We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a shareholder meeting called to approve the business combination or (ii) by means of a tender offer. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under the law or stock exchange listing requirement. Under Nasdaq rules, asset acquisitions and share purchases would not typically require shareholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our issued and outstanding ordinary shares or seek to amend our amended and restated memorandum and articles of association would require shareholder approval. We intend to conduct redemptions without a shareholder vote pursuant to the tender offer rules of the SEC unless shareholder approval is required by law or stock exchange listing requirement or we choose to seek shareholder approval for business or other legal reasons. So long as we obtain and maintain a listing for our securities on the Nasdaq, we will be required to comply with such rules. If a shareholder vote is not required and we do not decide to hold a shareholder vote for business or other legal reasons, we will, pursuant to our amended and restated memorandum and articles of association: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase our ordinary shares in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering more than a specified number of public shares, which number will be based on the requirement that we may not redeem public shares in an amount that would cause our 25 Table of Contents net tangible assets to be less than $5,000,001 upon consummation of our initial business combination, after payment of the deferred underwriting commission (so that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. If public shareholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination. If, however, shareholder approval of the transaction is required by law or stock exchange listing requirement, or we decide to obtain shareholder approval for business or other legal reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and file proxy materials with the SEC. We expect that a final proxy statement would be mailed to public shareholders at least ten days prior to the shareholder vote. However, we expect that a draft proxy statement would be made available to such shareholders well in advance of such time, providing additional notice of redemption if we conduct redemptions in conjunction with a proxy solicitation. Although we are not required to do so, we currently intend to comply with the substantive and procedural requirements of Regulation 14A in connection with any shareholder vote even if we are not able to maintain our Nasdaq listing or Exchange Act registration. If we seek shareholder approval, we will complete our initial business combination only if we obtain the approval of an ordinary resolution under Cayman Islands law, which requires the affirmative vote of holders of a majority of ordinary shares who attend and vote at a general meeting of the company. In such case, pursuant to the terms of a letter agreement entered into with us, our sponsor, officers and directors have agreed (and their permitted transferees will agree) to vote any founder shares and private placement shares held by them and any public shares purchased during or after this offering in favor of our initial business combination. We expect that at the time of any shareholder vote relating to our initial business combination, our sponsor and its permitted transferees will own approximately 20.0% of our issued and outstanding ordinary shares entitled to vote thereon (assuming it does not purchase units in this offering, and not taking into account ownership of the private placement units). As a result, in addition to our initial shareholder s founder shares and private placement shares, we would need only 2,110,001, or approximately 35.2% (assuming all outstanding shares are voted and no exercise of the underwriters over-allotment option) or 165,001, or 2.8% (assuming only the minimum number of shares representing a quorum are voted and no exercise of the underwriters over-allotment option), of the 6,000,000 public shares sold in this offering to be voted in favor of a transaction in order to have our initial business combination approved. These quorum and voting thresholds and agreements may make it more likely that we will consummate our initial business combination. Each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction. 26 Table of Contents Our amended and restated memorandum and articles of association will provide that we will only redeem our public shares in connection with our initial business combination so long as (after such redemption) our net tangible assets will be at least $5,000,001 either prior to or upon consummation of our initial business combination, after payment of the deferred underwriting commission (so that we are not subject to the SEC s penny stock rules). Redemptions of our public shares may also be subject to a higher net tangible asset test or cash requirement pursuant to an agreement relating to our initial business combination. For example, the proposed business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or retained by us for other general corporate purposes following completion of the business combination or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration we would be required to pay for all ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all ordinary shares submitted for redemption will be returned to the holders thereof. Alternatively, in order to ensure that we have at least $5,000,001 in assets as required under Rule 419 of the Securities Act, or to otherwise satisfy our capital needs in connection with a business combination, we may seek to source and complete third-party financing which may not be available on terms acceptable to us or at all. As a result, we may not be able to consummate such initial business combination and we may not be able to locate another suitable target within the applicable time period, if at all. Tendering share certificates in connection with a tender offer or redemption rights We may require our public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to either tender their certificates (if any) to our transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up to two business days prior to the vote on the proposal to approve our initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically using The Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option, rather than simply voting against the initial business combination. The tender offer or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public shareholders to satisfy such delivery requirements. 27 Table of Contents Limitation on redemption rights of shareholders holding more than 15% of the shares sold in this offering if we hold shareholder vote Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering. We believe the restriction described above will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our sponsor or its affiliates to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us or our sponsor or its affiliates at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Our sponsor, officers and directors have, pursuant to a letter agreement entered into with us, waived their right to have any founder shares or public shares held by them redeemed in connection with our initial business combination. Unless any of our other affiliates acquires founder shares through a permitted transfer from an initial shareholder, and thereby becomes subject to the letter agreement, no such affiliate is subject to this waiver. However, to the extent any such affiliate acquires public shares in this offering or thereafter through open market purchases, it would be a public shareholder and subject to the 15% limitation in connection with any such redemption right. Redemption Rights in connection with proposed amendments to our amended and restated memorandum and articles of association Some other blank check companies have a provision in their charter which prohibits the amendment of certain charter provisions. Our amended and restated memorandum and articles of association will provide that any of its provisions, including those related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the private placement units into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public shareholders as described herein and in our amended and restated memorandum and articles of association, but excluding the 28 Table of Contents provision of the articles relating to the appointment of directors), may be amended if approved by special resolution by holders of at least two-thirds of our ordinary shares who are eligible to vote and attend and vote in a general meeting, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of 65% of our ordinary shares. We may not issue additional securities that can vote on amendments to our amended and restated memorandum and articles of association or in our initial business combination. Our sponsor, which will beneficially own approximately 20.0% of our ordinary shares upon the closing of this offering (assuming it does not purchase units in this offering and not taking into account ownership of the private placement units), will participate in any vote to amend our amended and restated memorandum and articles of association and/or trust agreement and will have the discretion to vote in any manner it chooses. Our sponsor, officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association that would (i) modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within nine months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) or (ii) with respect to the other provisions relating to shareholders rights or pre-business combination activity, unless we provide our public shareholders with the opportunity to redeem their ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive (i) their redemption rights with respect to their founder shares, private placement shares and public shares in connection with the completion of our initial business combination and (ii) their redemption rights with respect to any founder shares and public shares held by them in connection with a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (a) to modify the substance or timing of our obligation to allow redemptions in connection with our initial business combination or to redeem 100% of our public shares if we have not consummated our initial business combination within the prescribed timeframe or (b) with respect to any other provision relating to shareholders rights or pre-initial business combination activity. 29 Table of Contents Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, all amounts held in the trust account will be released to us, other than funds the trustee will use to pay amounts due to any public shareholders who exercise their redemption rights as described above under Redemption rights for public shareholders upon completion of our initial business combination. We will use the remaining funds to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our sponsor, officers, and directors have agreed that we will have only nine months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) to complete our initial business combination. If we are unable to complete our initial business combination within such 9-month (or up to 18-month) time period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable, and less up to $60,000 of interest to pay dissolution expenses) divided by the number of then issued and outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our Board of Directors, liquidate and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants or rights, which will expire worthless if we fail to complete our initial business combination within the 9-month (or up to 18-month) time period. 30 Table of Contents Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to their founder shares and private placement shares if we fail to complete our initial business combination within nine months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus). However, if our sponsor acquires public shares after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted 9-month (or up to 18-month) time frame. The underwriters have agreed to waive their rights to their deferred underwriting commission held in the trust account in the event we do not complete our initial business combination within nine months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. Our sponsor, officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association that would (i) modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within nine months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) or (ii) with respect to the other provisions relating to shareholders rights or pre-business combination activity, unless we provide our public shareholders with the opportunity to redeem their ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares. However, we will only redeem our public shares in connection with our initial business combination so long as (after such redemption) our net tangible assets will be at least $5,000,001 either prior to or upon consummation of our initial business combination, after payment of the deferred underwriting commission (so that we are not subject to the SEC s penny stock rules). Limited payments to insiders There will be no finder s fees, reimbursements or cash payments made to our sponsor, officers or directors, or our or their affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination, other than the following payments, none of which will be made from the proceeds of this offering and the sale of the private placement units held in the trust account prior to the completion of our initial business combination: repayment of an aggregate of up to $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; 31 Table of Contents reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; and repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into units at a price of $10.00 per unit (which, for example, would result in the holders being issued 165,000 ordinary shares if $1,500,000 of notes were so converted (including 15,000 shares upon the closing of our initial business combination in respect of 150,000 rights included in such units), as well as 150,000 warrants to purchase 150,000 shares) at the option of the lender. These payments may be funded using the net proceeds of this offering and the sale of the private placement units not held in the trust account or, upon completion of the initial business combination, from any amounts remaining from the proceeds of the trust account released to us in connection therewith or any subsequent financing transaction which may be undertaken in connection with completion of a business combination. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliates. Audit committee Prior to the effectiveness of this registration statement, we will have established and will maintain an audit committee (which will be composed entirely of independent directors), to among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled Management Committees of the Board of Directors Audit Committee. 32 Table of Contents Conflicts of interest Each of our officers and directors presently has, and in the future any of our directors and our officers may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present acquisition opportunities to such entity. Accordingly, subject to his or her fiduciary duties under Cayman Islands law, if any of our officers or directors becomes aware of an acquisition opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she will need to honor his or her fiduciary or contractual obligations to present such acquisition opportunity to such entity, and only present it to us if such entity rejects the opportunity. Our amended and restated memorandum and articles of association will provide that, subject to his or her fiduciary duties under Cayman Islands law, we renounce our interest in any corporate opportunity offered to any officer or director unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue. We do not believe, however, that any fiduciary duties or contractual obligations of our directors or officers would materially undermine our ability to complete our business combination. In addition, the fiduciary duties and contractual obligations that our officers and directors may have to other entities, including confidentiality obligations that may restrict their ability to share with us or utilize on our behalf information they learn that could be beneficial to us, may otherwise adversely affect our ability to identify or pursue certain business combination opportunities. In recent years, and continuing in 2021, the number of special purpose acquisition companies that have been formed has increased substantially. Many potential targets for special purpose acquisition companies have already entered into an initial business combination. As a result, at times, we expect there to be greater competition for available targets, more time, more effort and more resources may be necessary to identify a suitable target, and the consummation of an initial business combination may be more expensive. Our sponsor s investment will be used to pay for the expenses of this offering, including the non-deferred portion of the underwriters compensation, and our operating expenses, even if an initial business combination is not completed. This combination of factors could result in our management team, which controls the sponsor, pursuing a business combination that may not be in the best interests of all public shareholders. See also Risk Factors As the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets. This could increase the cost of our initial business combination and could even result in our inability to find a target or to consummate an initial business combination and Management Conflicts of Interest. 33 Table of Contents Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a vendor for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (i) $10.15 per public share or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes (less up to $60,000 of interest to pay dissolution expenses), except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third party claims. We have not independently verified whether our sponsor has sufficient funds to satisfy their indemnity obligations and believe that our sponsor s only assets are securities of our company. We have not asked our sponsor to reserve for such obligations. Risks We were incorporated in 2021 under Cayman Island law and, to date, have conducted no operations and has generated no revenues. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision whether to invest in our securities, you should take into account not only the background of our management team, but also the special risks we face as a blank check company. This offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see Proposed Business Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419. 34 Table of Contents
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, references to: common stock are to our Class A common stock and our Class F common stock, collectively; equity-linked securities are to any debt or equity securities that are convertible, exercisable or exchangeable for our Class A common stock issued in connection with our initial business combination, including but not limited to a private placement of equity or debt. founder shares are to shares of our Class F common stock initially purchased by our sponsor in a private placement prior to this offering, and the shares of our Class A common stock issued upon the conversion thereof as provided herein; Gores Holdings IX, we, us, company or our company are to Gores Holdings IX, Inc., a Delaware corporation; initial stockholders are to holders of our founder shares prior to this offering; management or our management team are to our officers and directors; Prior Gores SPACs are collectively to Gores Holdings I, Gores Holdings II, Gores Holdings III, Gores Holdings IV, Gores Holdings V, Gores Holdings VI, Gores Holdings VII, Gores Holdings VIII, Gores Metropoulos, Gores Metropoulos II, Gores Technology, Gores Technology II and Gores Guggenheim, each as defined in this prospectus; private placement warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder s and member of our management team s status as a public stockholder shall only exist with respect to such public shares; sponsor are to Gores Sponsor IX LLC, a Delaware limited liability company and an affiliate of Gores; and The Gores Group or Gores are to The Gores Group, LLC, a Delaware limited liability company. Each unit consists of one share of Class A common stock and one-third of one warrant for each unit purchased. Each whole warrant entitles the holder thereof to purchase one share of Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED JANUARY 6, 2022 PRELIMINARY PROSPECTUS $525,000,000 52,500,000 Units Gores Holdings IX, Inc. is a newly organized blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one share of our Class A common stock and one-third of one warrant. Each whole warrant entitles the holder thereof to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as described herein, and only whole warrants are exercisable. The warrants will become exercisable on the later of 30 days after the completion of our initial business combination or 12 months from the closing of this offering, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We have also granted the underwriters a 45-day option to purchase up to an additional 7,875,000 additional units to cover over-allotments, if any. We will provide our stockholders with the opportunity to redeem all or a portion of their Class A common stock upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to fund our regulatory compliance requirements and other costs related thereto and/or to pay our franchise and income taxes, divided by the number of then outstanding shares of Class A common stock that were sold in this offering, which we refer to collectively as our public shares throughout this prospectus, subject to the limitations described herein. If we are unable to complete our business combination within 24 months from the closing of this offering, we will redeem 100% of the public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to fund our regulatory compliance requirements and other costs related thereto and/or to pay our franchise and income taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and as further described herein. Our sponsor, Gores Sponsor IX LLC (which we refer to as our sponsor throughout this prospectus), has committed to purchase an aggregate of 8,333,333 warrants (or 9,383,333 warrants if the over-allotment option is exercised in full) at a price of $1.50 per whole warrant (approximately $12,500,000 in the aggregate, or $14,075,000 if the underwriters over-allotment option is exercised in full) in a private placement that will close simultaneously with the closing of this offering. We refer to these warrants throughout this prospectus as the private placement warrants. Each whole private placement warrant is exercisable to purchase one whole share of our Class A common stock at $11.50 per share. Our initial stockholders own 15,093,750 shares of our Class F common stock (up to 1,968,750 shares of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised). We refer to these shares of Class F common stock as the founder shares throughout this prospectus. The shares of Class F common stock will automatically convert into shares of Class A common stock at the time of our initial business combination, or earlier at the option of the holder, on a one-for-one basis, subject to adjustment as provided herein. In the case that any amount of additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in this prospectus and related to the closing of the business combination, the ratio at which shares of Class F common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class F common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class F common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock issued and outstanding upon completion of this offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with the business combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in the business combination). Prior to our initial business combination, only holders of shares of our Class F common stock will be entitled to vote on the appointment of directors. With respect to any other matter submitted to a vote of our stockholders, including any vote in connection with our initial business combination, except as required by law, holders of our founder shares and holders of our public shares will vote together as a single class, with each share entitling the holder to one vote. Currently, there is no public market for our securities. We will apply to have our units listed on the Nasdaq Global Market ( Nasdaq ), under the symbol GHIXU promptly after the date of this prospectus. We cannot guarantee that our units will be approved for listing on Nasdaq. The Class A common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Deutsche Bank Securities Inc. and Goldman Sachs & Co. LLC inform us of their decision to allow earlier separate trading, subject to our filing a Current Report on Form 8-K with the Securities and Exchange Commission (the SEC ), containing an audited balance sheet reflecting our receipt of the gross proceeds of this offering and issuing a press release announcing when such separate trading will begin. Once the securities comprising the units begin separate trading, we expect that the Class A common stock and warrants will be listed on Nasdaq under the symbols GHIX and GHIXW, respectively. We are an emerging growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See the section of this prospectus entitled Risk Factors beginning on page 45 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 525,000,000 Underwriting discounts and commissions(1) $ 0.55 $ 28,875,000 Proceeds, before expenses, to Gores Holdings IX, Inc. $ 9.45 $ 496,125,000 (1) Includes $0.35 per public share, or $18,375,000 (or up to $21,131,250 if the underwriters over-allotment option is exercised in full) in the aggregate payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein. The deferred commissions will be released to the underwriters only on completion of an initial business combination, as described in this prospectus. See the section of this prospectus entitled Underwriting. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $525.0 million or $603.75 million if the underwriters over-allotment option is exercised in full ($10.00 per share in either case) will be deposited into a U.S.-based trust account at Deutsche Bank Trust Company Americas with Computershare Trust Company, N.A. acting as trustee, and $2.0 million will be available to pay fees and expenses in connection with the closing of this offering and for working capital following the closing of this offering. Except with respect to up to $900,000 per year of interest earned on the funds held in the trust account that may be released to us to fund our regulatory compliance requirements and other costs related thereto, plus additional amounts to pay our franchise and income tax obligations, the proceeds from this offering and the sale of the private placement warrants will not be released from the trust account until the earliest to occur of (a) the completion of our initial business combination, (b) the redemption of any public shares properly tendered in connection with a stockholder vote to amend our amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering or (ii) with respect to any other provisions relating to stockholders rights or pre-initial business combination activity and (c) the redemption of all of our public shares if we are unable to complete our business combination within 24 months from the closing of this offering, subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. The underwriters are offering the shares for sale on a firm commitment basis. The underwriters expect to deliver the shares to the purchasers on or about , 2022. Deutsche Bank Securities Goldman Sachs & Co. LLC , 2022 Table of Contents our Class A common stock at a price of $11.50 per share, subject to adjustment as described in this prospectus, and only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least three units, you will not be able to receive or trade a whole warrant. Registered trademarks referred to in this prospectus are the property of their respective owners. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Our Company We are a newly organized blank check company incorporated as a Delaware corporation and formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. While we may pursue an acquisition opportunity in any business industry or sector, we intend to capitalize on the ability of our management team to identify, acquire and manage a business that can benefit from our operational expertise, as members of our management team have done in diverse sectors, including industrials, technology, telecommunications, media and entertainment, business services, healthcare and consumer products. This operationally- oriented investment approach has served The Gores Group well since its founding in 1987. We believe that our management team is well positioned to identify operationally-oriented acquisition opportunities in the marketplace and that our contacts and transaction sources, ranging from owners and directors of private and public companies, private equity funds, investment bankers, lenders, attorneys, accountants and other trusted advisors across various sectors, will allow us to generate attractive acquisition opportunities. Our team is led by Alec Gores, our Chairman, who has more than 35 years of experience as an entrepreneur, operator and private equity investor. Over the course of his career, Mr. Gores and his team have invested in more than 120 portfolio companies through varying macroeconomic environments with a consistent, operationally-oriented investment strategy. Mr. Gores is the Founder, Chairman and Chief Executive Officer of The Gores Group, a global investment firm focused on acquiring businesses that can benefit from the firm s operating expertise. Mr. Gores implemented an operational approach to private equity investing when he founded The Gores Group in 1987 by operating businesses alongside management, or in some cases in lieu of management, to build value in those entities. Since then, the firm has acquired more than 120 businesses including a current portfolio of 8 active companies worldwide. Under Mr. Gores leadership, The Gores Group has effected a number of successful corporate carve-out acquisitions over the last two decades. The Gores Group acquired VeriFone from Hewlett-Packard Company at a time when the business was generating significant revenues, but was cash flow negative. The Gores Group implemented dramatic changes to the business, and the business was sold and subsequently went public with an operating partner from The Gores Group serving as its chief executive officer. During that same timeframe, The Gores Group acquired The Learning Company from Mattel Corporation and transformed that Table of Contents business which, similarly, was generating significant revenues, but was suffering from severely negative cash flow. Since then, with Mr. Gores leading the firm, The Gores Group has created significant value in numerous transactions, including the acquisitions of Global Tel*Link from Schlumberger Ltd., Stock Building Supply from Wolseley plc, Therakos from Johnson & Johnson, the electronics power systems business from TE Connectivity Ltd., Siemens Enterprise Communications from Siemens AG and Sagem Communications from the Safran Group, among others. Mr. Gores began his career as a self-made entrepreneur and operating executive. In 1978, he self-funded and founded Executive Business Systems (EBS), a developer and distributor of vertical business software systems. Within seven years, EBS had become a leading value-added reseller in Michigan and employed over 200 people. In 1986, CONTEL purchased EBS, and Mr. Gores subsequently began acquiring and operating non-core businesses from major corporations and building value in those entities, a decision that ultimately led to the founding of what has evolved into The Gores Group today. Under his leadership, The Gores Group has continued to acquire businesses in need of operational and financial resources, while creating value and working with management teams to establish an entrepreneurial environment as a foundation for sustainable growth. As of September 30, 2021, The Gores Group had approximately $537 million in assets under management. Together with a team of operations professionals spanning key business functional areas, as well as dedicated investment origination and mergers and acquisitions professionals, Mr. Gores developed a formula that led to numerous marquee investments and business transformations, with a strong focus on carve-out acquisitions from large corporate transaction partners, including: The Learning Company from Mattel Corporation; VeriFone from Hewlett-Packard Company; Micron PC from Micron Electronics, Inc.; Sagem Communications from the Safran Group; Stock Building Supply from Wolseley plc; The broadcast communications division from Harris Corporation; The electronics power systems business from TE Connectivity Ltd.; Elo Touch Solutions from TE Connectivity Ltd.; Therakos from Johnson & Johnson; and Brand-Rex from Honeywell International, Inc. Our team, led by Alec Gores and including Mark Stone and Andrew McBride, has in the aggregate over 80 years of combined operational, financial, investment and transactional experience involving a diverse group of businesses, and we intend to focus on industries or sectors offering operationally-oriented acquisition opportunities that can benefit from our expertise. Messrs. Gores, Stone and McBride possess complementary skills and experience encompassing all aspects of the investment process, including sourcing, due diligence, valuation, structuring, financing, negotiation, execution, strategy development, operations management and investment realization. Table of Contents In June 2015, Mr. Gores and Mr. Stone founded Gores Holdings, Inc. ( Gores Holdings I ), a blank check company formed for substantially similar purposes as our company. Mr. Stone served as Chief Executive Officer and Mr. McBride served as Chief Financial Officer for Gores Holdings I. Gores Holdings I completed its initial public offering in August 2015, in which it sold 37,500,000 units, each consisting of one share of Gores Holdings I common stock and one warrant to purchase one-half of one share of Gores Holdings I common stock, for an offering price of $10.00 per unit, generating aggregate proceeds of $375,000,000. Gores Holdings I completed its business combination with Hostess Brands, Inc. ( Hostess ) in November 2016, in which it contributed approximately $725 million to Hostess (consisting of $375 million in proceeds from the initial public offering and a simultaneous private placement plus approximately $350 million in proceeds from an additional private placement completed at the time of the initial business combination). Hostess is one of the largest manufacturers and marketers of sweet baked goods including Twinkies , Ding Dongs , Ho Hos , Donettes and a variety of new and classic treats. Hostess s Class A common stock is traded on Nasdaq under the symbol TWNK and its warrants are traded under the symbol TWNKW. From the closing of the business combination with Hostess until April 2018, Mr. Stone served as a director of Hostess. In August 2016, Mr. Gores and Mr. Stone founded Gores Holdings II, Inc. ( Gores Holdings II ), a blank check company formed for substantially similar purposes as our company and Gores Holdings I. Additionally, Mr. Stone served as Chief Executive Officer and Mr. McBride served as Chief Financial Officer for Gores Holdings II. Gores Holdings II completed its initial public offering in January 2017, in which it sold 40,000,000 units, each consisting of one share of Gores Holdings II common stock and one-third of one warrant to purchase one share of Gores Holdings II common stock, for an offering price of $10.00 per unit, generating aggregate proceeds of $400,000,000. Gores Holdings II completed its business combination with Verra Mobility Corporation ( Verra ) (formerly known as American Traffic Solutions, Inc.) in October 2018, in which it contributed approximately $800 million to Verra (consisting of $400 million in proceeds from the initial public offering and a simultaneous private placement, plus approximately $400 million in proceeds from an additional private placement completed at the time of the initial business combination). Verra is a global leader in smart mobility and provides traffic safety, mobility, and compliance solutions for state and local governments, commercial fleets, and rental car companies in North America. Verra s Class A common stock is traded on Nasdaq under the symbol VRRM . In October 2017, Mr. Gores and Mr. Stone founded Gores Holdings III, Inc. ( Gores Holdings III ), a blank check company formed for substantially similar purposes as our company, Gores Holdings I and Gores Holdings II. Additionally, Mr. Stone served as Chief Executive Officer, and Mr. McBride served as the Chief Financial Officer for Gores Holdings III. Gores Holdings III completed its initial public offering in September 2018, in which it sold 40,000,000 units, each consisting of one share of Gores Holdings III common stock and one-third of one warrant to purchase one share of Gores Holdings III common stock, for an offering price of $10.00 per unit, generating aggregate proceeds of $400,000,000. Gores Holdings III completed its business combination with PAE Incorporated ( PAE ) in February 2020, in which it contributed approximately $620 million to PAE (consisting of $400 million in proceeds from the initial public offering and a simultaneous private placement, plus approximately $220 million in proceeds from an additional private placement completed at the time of the initial business combination). PAE is a leading provider of mission-critical services to the U.S. government, armed forces and international customers. PAE s common stock and warrants are traded on Nasdaq under the symbols PAE and PAEWW , respectively. Table of Contents In August 2018, Mr. Gores, together with Dean Metropoulos, a private investor specializing in investments in the consumer branded products industries, founded Gores Metropoulos, Inc. ( Gores Metropoulos ), a blank check company formed for substantially similar purposes as our company, Gores Holdings I, Gores Holdings II and Gores Holdings III. Additionally, Mr. McBride, our Chief Financial Officer, served as Chief Financial Officer of Gores Metropoulos. Gores Metropoulos completed its initial public offering in February 2019, in which it sold 40,000,000 units, each consisting of one share of Gores Metropoulos common stock and one-third of one warrant to purchase one share of Gores Metropoulos common stock, for an offering price of $10.00 per unit, generating aggregate proceeds of $400,000,000. Gores Metropoulos completed its business combination with Luminar Technologies, Inc. ( Luminar ) in December 2020, in which it contributed approximately $406 million to Luminar (consisting of proceeds from the initial public offering and a simultaneous private placement). Luminar is a global leader in automotive lidar technology powering the introduction of highway autonomy. Luminar s common stock and warrants are traded on Nasdaq under the symbols LAZR and LAZRW, respectively. Mr. Gores continues to serve as a director of Luminar. In July 2019, Mr. Gores and Mr. Stone founded Gores Holdings IV, Inc. ( Gores Holdings IV ), a blank check company formed for substantially similar purposes as our company, Gores Holdings I, Gores Holdings II, Gores Holdings III and Gores Metropoulos. Gores Holdings IV completed its initial public offering in January 2020, in which it sold 42,500,000 units, each consisting of one share of Gores Holdings IV common stock and one-fourth of one warrant to purchase one share of Gores Holdings IV common stock, for an offering price of $10.00 per unit, generating aggregate proceeds of $425,000,000. Gores Holdings IV completed its business combination with United Wholesale Mortgage ( UWM ) in January 2021, in which it contributed approximately $895 million to UWM (consisting of $425 million in proceeds from the initial public offering and a simultaneous private placement). UWM is a leading wholesale mortgage lender in the U.S. UWM s common stock and warrants are traded on the New York Stock Exchange under the symbols UWMC and UWMCWS, , respectively. In June 2020, Mr. Gores and Mr. Stone founded Gores Holdings V, Inc. ( Gores Holdings V ), a blank check company formed for substantially similar purposes as our company, Gores Holdings I, Gores Holdings II, Gores Holdings III, Gores Metropoulos and Gores Holdings IV. Gores Holdings V completed its initial public offering on August 10, 2020, in which it sold 52,500,000 units, each consisting of one share of Gores Holdings V common stock and one-fifth of one warrant to purchase one share of Gores Holdings V common stock, for an offering price of $10.00 per unit, generating aggregate proceeds of $525,000,000. Gores Holdings V completed its business combination with a subsidiary of Ardagh Metal Packaging S.A ( Ardagh Metal Packaging or AMP ) in August 2021. AMP is a global leader in the supply of sustainable and infinitely-recyclable beverage cans. AMP s common stock and warrants are traded on the New York Stock Exchange under the symbols AMPB and AMPBW, respectively. In June 2020, Mr. Gores founded Gores Holdings VI, Inc. ( Gores Holdings VI ), a blank check company formed for substantially similar purposes as our company, Gores Holdings I, Gores Holdings II, Gores Holdings III, Gores Metropoulos, Gores Holdings IV and Gores Holdings V. Gores Holdings VI completed its initial public offering in December 2020, in which it sold 34,500,000 units, each consisting of one share of Gores Holdings VI common stock and one-fifth of one warrant to purchase one share of Gores Holdings VI common stock, for an offering price of $10.00 per unit, generating aggregate proceeds of $345,000,000. Gores Holdings VI completed its business combination with Matterport, Inc. ( Matterport ) in July 2021. Matterport is the world s leading platform for the digitization and datafication of the built Table of Contents world. Matterport s common stock and warrants are traded on Nasdaq under the symbols MTTR and MTTRW, respectively. In July 2020, Mr. Gores, together with Dean Metropoulos, founded Gores Metropoulos II, Inc. ( Gores Metropoulos II ), a blank check company formed for substantially similar purposes as our company, Gores Holdings I, Gores Holdings II, Gores Holdings III, Gores Metropoulos, Gores Holdings IV, Gores Holdings V and Gores Holdings VI. Gores Metropoulos II completed its initial public offering in January 2021, in which it sold 45,000,000 units, each consisting of one share of Gores Metropoulos II common stock and one-fifth of one warrant to purchase one share of Gores Metropoulos II common stock, for an offering price of $10.00 per unit, generating aggregate proceeds of $450,000,000. Gores Metropoulos II has announced its proposed initial business combination with Sonder Holdings, Inc. ( Sonder ), a leading next generation hospitality company redefining the guest experience. Gores Metropoulos II has announced that on January 14, 2022 it will hold a special meeting of the stockholders to vote on the proposed business combination with Sonder and expects to close the business combination in early first quarter 2022. Mr. Gores, our Chairman, serves as the Chief Executive Officer and as a director of Gores Metropoulos II. Mr. McBride, our Chief Financial Officer, serves as the Chief Financial Officer of Gores Metropoulos II. In September 2020, Mr. Gores founded Gores Holdings VII, Inc. ( Gores Holdings VII ), a blank check company formed for substantially similar purposes as our company, Gores Holdings I, Gores Holdings II, Gores Holdings III, Gores Metropoulos, Gores Holdings IV, Gores Holdings V and Gores Holdings VI. Gores Holdings VII completed its initial public offering in February 2021, in which it sold 55,000,000 units, each consisting of one share of Gores Holdings VII common stock and one-eighth of one warrant to purchase one share of Gores Holdings VII common stock, for an offering price of $10.00 per unit, generating aggregate proceeds of $550,000,000. Gores Holdings VII has not yet announced or completed its initial business combination. Mr. Stone, our Chief Executive Officer, serves as the Chief Executive Officer of Gores Holdings VII. Mr. McBride, our Chief Financial Officer, serves as the Chief Financial Officer of Gores Holdings VII. In September 2020, Mr. Gores founded Gores Holdings VIII, Inc. ( Gores Holdings VIII ), a blank check company formed for substantially similar purposes as our company, Gores Holdings I, Gores Holdings II, Gores Holdings III, Gores Metropoulos, Gores Holdings IV, Gores Holdings V, Gores Holdings VI, and Gores Holdings VII. Gores Holdings VIII completed its initial public offering in March 2021, in which it sold 34,500,000 units, each consisting of one share of Gores Holdings VIII common stock and one-eighth of one warrant to purchase one share of Gores Holdings VIII common stock, for an offering price of $10.00 per unit, generating aggregate proceeds of $345,000,000. Gores Holdings VIII has announced its proposed initial business combination with Footprint International Holdco, Inc. ( Footprint International ), a global materials science technology company focused on sustainable solutions. Mr. Stone, our Chief Executive Officer, serves as the Chief Executive Officer of Gores Holdings VIII. Mr. McBride, our Chief Financial Officer, serves as the Chief Financial Officer of Gores Holdings VIII. In December 2020, Mr. Gores founded Gores Technology Partners, Inc. ( Gores Technology ), a blank check company formed for substantially similar purposes as our company, Gores Holdings I, Gores Holdings II, Gores Holdings III, Gores Metropoulos, Gores Holdings IV, Gores Holdings V, Gores Holdings VI, Gores Metropoulos II, Gores Holdings VII and Gores Holdings VIII. Gores Technology completed its initial public offering in March 2021, in which it sold 27,500,000 units, each consisting of one share of Gores Technology common stock and one-fifth of one warrant to purchase one share of Gores Technology common stock, for an offering price of $10.00 per unit, generating aggregate proceeds of $275,000,000. Gores Table of Contents Technology has not yet announced or completed its initial business combination. Mr. McBride, our Chief Financial Officer, serves as the Chief Financial Officer of Gores Technology. In December 2020, Mr. Gores founded Gores Technology Partners II, Inc. ( Gores Technology II ), a blank check company formed for substantially similar purposes as our company, Gores Holdings I, Gores Holdings II, Gores Holdings III, Gores Metropoulos, Gores Holdings IV, Gores Holdings V, Gores Holdings VI, Gores Metropoulos II, Gores Holdings VII, Gores Holdings VIII and Gores Technology. Gores Technology II completed its initial public offering in March 2021, in which it sold 46,000,000 units, each consisting of one share of Gores Technology II common stock and one-fifth of one warrant to purchase one share of Gores Technology II common stock, for an offering price of $10.00 per unit, generating aggregate proceeds of $400,000,000. Gores Technology II has not yet announced or completed its initial business combination. Mr. McBride, our Chief Financial Officer, serves as the Chief Financial Officer of Gores Technology II. In December 2020, Mr. Gores, together with Guggenheim Capital, LLC, founded Gores Guggenheim, Inc. ( Gores Guggenheim ), a blank check company formed for substantially similar purposes as our company, Gores Holdings I, Gores Holdings II, Gores Holdings III, Gores Metropoulos, Gores Holdings IV, Gores Holdings V, Gores Holdings VI, Gores Metropoulos II, Gores Holdings VII, Gores Holdings VIII, Gores Technology and Gores Technology II. Gores Guggenheim completed its initial public offering in March 2021, in which it sold 75,000,000 units, each consisting of one share of Gores Guggenheim common stock and one-fifth of one warrant to purchase one share of Gores Guggenheim common stock, for an offering price of $10.00 per unit, generating aggregate proceeds of $750,000,000. Subsequently, in April 2021, the underwriters partially exercised their option to purchase 5,000,000 newly issued units to cover over-allotments, and following the partial exercise of the over-allotment option, the total aggregate issuance by the Company of 80,000,000 units at a price of $10.00 per unit resulted in total gross proceeds of $800,000,000. Mr. Stone, our Chief Executive Officer, serves as the Chief Executive Officer of Gores Guggenheim. Mr. McBride, our Chief Financial Officer, serves as the Chief Financial Officer of Gores Guggenheim. Gores Guggenheim has entered into a definitive agreement to acquire Polestar Performance AB and its affiliates ( Polestar ), a global pure play, premium electric performance vehicle manufacturer. The proposed business combination is expected to close in the first half of 2022, subject to approval by Gores Guggenheim s stockholders and other customary closing conditions. In January 2021, Mr. Gores founded Gores Holdings X, Inc. ( Gores Holdings X ), a blank check company formed for substantially similar purposes as our company, Gores Holdings I, Gores Holdings II, Gores Holdings III, Gores Metropoulos, Gores Holdings IV, Gores Holdings V, Gores Holdings VI, Gores Metropoulos II, Gores Holdings VII, Gores Holdings VIII, Gores Technology, Gores Technology II and Gores Guggenheim. Gores Holdings X has not yet completed its initial public offering. Mr. McBride, our Chief Financial Officer, serves as the Chief Financial Officer of Gores Holdings X. Mr. Stone, our Chief Executive Officer, serves as the Chief Executive Officer of Gores Holdings X. Our management team s objective is to generate attractive investment returns to create value for our stockholders by applying our strategy of identifying operationally-oriented acquisition opportunities and capitalizing on the ability of our management team to acquire and manage a business that can benefit from our operational expertise. Our management team s approach is focused on industries or sectors in which we have considerable knowledge and emphasizes downside protection and the preservation of capital by opportunistically pursuing transactions where we believe we have the ability to capture asymmetric risk/reward potential. Table of Contents Our management team has successfully applied this acquisition philosophy over its history to source attractive private equity acquisition opportunities and to deploy capital in varying macroeconomic environments. Our management team will assess the skills, qualifications and abilities of the management team of each potential business combination target. The level and length of our existing management s continued active participation in our post-acquisition business will depend on the particular needs of the business acquired. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. With respect to the foregoing examples, past performance of The Gores Group and by our management team, including with respect to the Prior Gores SPACs and Gores Holdings X, is not a guarantee either (i) of success with respect to any business combination we may consummate or (ii) that we will be able to identify a suitable candidate for our initial business combination. You should not rely on the historical record of The Gores Group s, or our management s, or Gores Holdings X s or any of the Prior Gores SPACs performance as indicative of our future performance. Business Strategy Our acquisition and value creation strategy is to identify, acquire and, after our initial business combination, to build a company in an industry or sector that complements the experience of our management team and can benefit from our operational expertise. Our acquisition selection process will leverage our team s network of potential transaction sources, ranging from owners and directors of private and public companies, private equity funds, investment bankers, lenders, attorneys, accountants and other trusted advisors across various sectors. In addition, we intend to utilize the networks and industry experience of Mr. Gores and The Gores Group in seeking an initial business combination. Over the course of their careers, the members of our management team have developed a broad network of contacts and corporate relationships that we believe will serve as a useful source of acquisition opportunities. This network has been developed through our management team s combined history of over 80 years of business experience, including in private equity and investment banking. We expect this network will provide our management team with a robust and consistent flow of acquisition opportunities. In addition, we anticipate that target business candidates will be brought to our attention from various unaffiliated sources, including investment market participants, private equity groups, investment banking firms, consultants, accounting firms and large business enterprises. Upon completion of this offering, members of our management team will communicate with their networks of relationships to articulate the parameters for our search for any business combination target and begin the process of pursuing and reviewing potentially interesting leads. Acquisition Criteria Consistent with our strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. We intend to seek to acquire companies that we believe: have a defensible core business, sustainable revenues and established customer relationships; Table of Contents are undergoing change in capital structure, strategy, operations or growth; can benefit from our operational and strategic approach; offer a unique value proposition with transformational potential that can be substantiated during our detailed due diligence process; and have reached a transition point in their lifecycle presenting an opportunity for transformation. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. Initial Business Combination Our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the income earned on the trust account) at the time of the agreement to enter into the initial business combination. If our board is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm that is a member of the Financial Industry Regulatory Authority, ( FINRA ), or an independent accounting firm with respect to the satisfaction of such criteria. We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. Table of Contents Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended (the Exchange Act ). As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our business combination. Our Acquisition Process In evaluating a prospective target business, we expect to conduct a thorough due diligence review that will encompass, among other things, meetings with incumbent management and employees, document reviews, inspection of facilities, as well as a review of financial, operational, legal and other information that will be made available to us. We will also utilize our operational and capital planning experience. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm which is a member of FINRA or an independent accounting firm that our initial business combination is fair to our company from a financial point of view. Members of our management team and our independent directors will directly or indirectly own founder shares and/or private placement warrants following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. All of the members of our management team are employed by certain affiliates of The Gores Group. The Gores Group is continuously made aware of potential business combination opportunities and we may pursue any business combination target that has already been considered by The Gores Group or any of the Prior Gores SPACs or Gores Holdings X in a different context. We have not selected any business combination target and we have not, nor has anyone on our behalf initiated any substantive discussions, directly or indirectly, with any business combination target. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity. Specifically, all of our officers and certain of our directors have fiduciary and contractual duties to The Gores Group and certain companies it has invested in or managed, including Gores Holdings VII, Gores Holdings VIII, Gores Metropoulos II, Gores Technology, Gores Technology II, Gores Guggenheim and Gores Holdings X. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such entity. We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to search for an initial business combination. Our amended and restated Table of Contents certificate of incorporation will contain a waiver of the corporate opportunity doctrine, which will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless (i) such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company, (ii) such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue and (iii) the director or officer is permitted to refer the opportunity to us without violating another legal obligation. The purpose for the surrender of corporate opportunities is to allow officers, directors or other representatives with multiple business affiliations to continue to serve as an officer of our company or on our board of directors. Our officers and directors may from time to time be presented with opportunities that could benefit both another business affiliation and us. In the absence of the corporate opportunity waiver in our charter, certain candidates would not be able to serve as an officer or director. We believe we substantially benefit from having representatives who bring significant, relevant and valuable experience to our management, and, as a result, the inclusion of the corporate opportunity waiver in our amended and restated certificate of incorporation provides us with greater flexibility to attract and retain the officers and directors that we feel are the best candidates. However, the personal and financial interests of our directors and officers may influence their motivation in timely identifying and pursuing an initial business combination or completing our initial business combination. The different timelines of competing business combinations could cause our directors and officers to prioritize a different business combination over finding a suitable acquisition target for our business combination. Consequently, our directors and officers discretion in identifying and selecting a suitable target business may result in a conflict of interest when determining whether the terms, conditions and timing of a particular business combination are appropriate and in our stockholders best interest, which could negatively impact the timing for a business combination. In addition, our sponsor, officers and directors may participate in the formation of, or become an officer or director of, any other blank check company prior to completion of our initial business combination. As a result, our sponsor, officers or directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. Although we have no formal policy in place for vetting potential conflicts of interest, our board of directors will review any potential conflicts of interest on a case-by-case basis. In particular, affiliates of our sponsor are currently sponsoring seven other blank check companies, Gores Holdings VII, Gores Holdings VIII, Gores Metropoulos II, Gores Technology, Gores Technology II, Gores Guggenheim and Gores Holdings X. Further, Mr. Gores, our Chairman, will serve as the Chief Executive Officer of Gores Metropoulos II until the closing of its pending business combination with Sonder. Further, Mr. Stone, our Chief Executive Officer, serves as the Chief Executive Officer of Gores Holdings VII, Gores Holdings VIII, Gores Guggenheim and Gores Holdings X and Mr. McBride, our Chief Financial Officer, serves as the Chief Financial Officer for Gores Holdings VII, Gores Holdings VIII, Gores Metropoulos II, Gores Technology, Gores Technology II, Gores Guggenheim and Gores Holdings X. Any such companies, including Gores VII, Gores Holdings VIII, Gores Metropoulos II, Gores Technology, Gores Technology II, Gores Guggenheim and Gores Holdings X may present additional conflicts of interest in pursuing an acquisition target. However, we do not believe that any potential conflicts with Gores Holdings VII, Gores Holdings VIII, Gores Metropoulos II, Gores Technology, Gores Technology II, Gores Guggenheim or Gores Holdings X would materially affect our ability to identify and pursue initial business combination opportunities or complete our initial business combination, Table of Contents because (i) our management team has significant experience in identifying and executing multiple acquisition opportunities simultaneously, and (ii) we are not limited by industry or geography in terms of the acquisition opportunities we can pursue. In addition, we do not believe that any potential conflicts exist with Gores Technology and Gores Technology II, because (i) Gores Technology and Gores Technology II intend to focus on acquisition opportunities in the consumer internet, enterprise software, fintech, digital health, proptech, gaming, agtech, or logistics industries, whereas we do not intend to limit our focus to a particular industry, (ii) Gores Technology and Gores Technology II have different Co-Chief Executive Officers and Chairman of the Board than Gores Holdings IX, (iii) we expect, given the industry focus of Gores Technology and Gores Technology II, that Mr. Wilson and Mr. Fike will lead the search for business combination targets for Gores Technology and Gores Technology II, whereas Mr. Stone and Mr. Gores will lead such efforts for Gores Holdings IX, (iv) three of the four directors that will be on our board are not directors of Gores Technology or Gores Technology II, and (v) we believe the different industry focus and the different composition of our leadership will mitigate any potential conflicts of interest that exist with respect to Gores Technology and Gores Technology II. In addition, we do not believe that any potential conflicts with Gores Guggenheim, because two of the five directors on Gores Guggenheim s board will not be on our board and the different composition of our leadership will mitigate any potential conflicts of interest with respect to Gores Guggenheim. In addition to the above, our officers and directors are not required to commit any specified amount of time to our affairs, and, accordingly, may have conflicts of interest in allocating management time among various business activities, including selecting a business combination target and monitoring the related due diligence. See Risk Factors Risks Relating to our Management Team Our officers and directors will allocate their time to other businesses thereby causing potential conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to identify and pursue initial business combination opportunities or complete our initial business combination. Additionally, our initial stockholders have agreed to waive their redemption rights with respect to any founder shares and any public shares held by them in connection with the consummation of our initial business combination. Further, our initial stockholders have agreed to waive their redemption rights with respect to any founder shares held by them if we fail to consummate our initial business combination within 24 months after the closing of this offering. If we do not complete our initial business combination within such applicable time period, the proceeds of the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares, and the private placement warrants will expire worthless. With certain limited exceptions, the founder shares will not be transferable, assignable or salable by our initial stockholders until 180 days after the completion of our initial business combination. With certain limited exceptions, the private placement warrants and the Class A common stock underlying such warrants, will not be transferable, assignable or salable by our sponsor or its permitted transferees until 30 days after the completion of our initial business combination. Since our sponsor and officers and directors may directly or indirectly own common stock and warrants following this offering, our officers and directors may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination because of their financial interest in completing an initial business combination within 24 months after the closing of this offering. As more fully discussed in Management Conflicts of Interest, if any of our directors or officers becomes aware of any business combination target that falls within the line of business Table of Contents of any entity to which he or she has pre-existing fiduciary or contractual obligations, including Gores Holdings VII, Gores Holdings VIII, Gores Metropoulos II, Gores Technology, Gores Technology II, Gores Guggenheim and Gores Holdings X, he or she may be required to present such business combination target to such entity prior to presenting such business combination target to us. Our officers, directors and director nominees currently have fiduciary duties or contractual obligations that may take priority over their duties to us. Corporate Information We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012, (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion (as adjusted for inflation pursuant to SEC rules from time to time), or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of any fiscal year for so long as either (1) the market value of our common stock held by non-affiliates does not equal or exceed $250.0 million as of the prior June 30th, or (2) our annual revenues did not equal or exceed $100.0 million during such completed fiscal year and the market value of our common stock held by non-affiliates did not equal or exceed $700.0 million as of the prior June 30th. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible. Our executive offices are located at 6260 Lookout Road, Boulder, Colorado 80301 and our telephone number is (303) 531-3100. Table of Contents The Offering In making your decision on whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section of this prospectus entitled Risk Factors. Securities offered 52,500,000 units, at $10.00 per unit, each unit consisting of: one share of Class A common stock; and one-third of one warrant. Nasdaq symbols Units: GHIXU Class A Common Stock: GHIX Warrants: GHIXW Trading commencement and separation of Class A common stock and warrants The units will begin trading promptly after the date of this prospectus. The Class A common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Deutsche Bank Securities Inc. and Goldman Sachs & Co. LLC inform us of their decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the shares of Class A common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of Class A common stock and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least three units, you will not be able to receive or trade a whole warrant. Separate trading of the Class A common stock and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A common stock and warrants be traded separately until we have filed a Current Report on Form 8-K with the SEC containing an audited balance sheet reflecting our receipt of the gross proceeds at the closing of Table of Contents this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which is anticipated to take place two business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. Units: Number outstanding before this offering 0 Number outstanding after this offering 52,500,000(1) Common stock: Number outstanding before this Offering 15,093,750 shares of Class F common stock(2)(3) Number outstanding after this offering 65,625,000 shares of Class A common stock and Class F common stock(1)(3) Warrants: Number of private placement warrants to be sold in a private placement simultaneously with this offering 8,333,333(1) Number of warrants to be outstanding after this offering and the private placement 25,833,333(1) Exercisability Each whole warrant is exercisable to purchase one share of our Class A common stock and only whole warrants are exercisable. (1) Assumes no exercise of the underwriters over-allotment option and the forfeiture by our sponsor of 1,968,750 founder shares. As discussed under Founder shares below, for our sponsor to maintain ownership of 20% of the outstanding shares following completion of this offering, if the over-allotment option is not exercised by the underwriters, our sponsor would be required to forfeit 1,968,750 shares. (2) Includes up to 1,968,750 shares that are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. (3) The shares of common stock included in the units are Class A common stock. Founder shares are classified as shares of Class F common stock, which shares are convertible into shares of our Class A common stock on a one- for-one basis, subject to adjustment as described below adjacent to the caption Founder shares conversion and anti-dilution rights. Table of Contents Exercise price $11.50 per share, subject to adjustment as described herein. Exercise period The warrants will become exercisable on the later of: 30 days after the completion of our initial business combination, or 12 months from the closing of this offering; provided in each case that we have an effective registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise of the warrants and a current prospectus relating to them is available (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). We are not registering the shares of Class A common stock issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable, but in no event later than fifteen (15) business days after the closing of our initial business combination, we will use commercially reasonable efforts to file and have an effective registration statement covering the shares of Class A common stock issuable upon exercise of the warrants, to maintain a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed; provided, that if our Class A common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption of warrants for cash Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the private placement warrants): in whole and not in part; Table of Contents at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period; and if, and only if, the last sale price of our Class A common stock equals or exceeds $18.00 per share for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. We will not redeem the warrants unless a registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise of the warrants is effective and a current prospectus relating to those shares of Class A common stock is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. Redemption of warrants for Class A common stock Commencing ninety days after the warrants become exercisable we may redeem the outstanding warrants: in whole and not in part; at a price equal to a number of shares of Class A common stock to be determined by reference to the table set forth under Description of Securities Warrants Public Stockholders Warrants based on the redemption date and the fair market value of our Class A common stock except as otherwise described in Description of Securities Warrants Public Stockholders Warrants ; if, and only if, the private placement warrants are also concurrently exchanged at the same price (equal to a number of shares of Class A common stock) as the outstanding public warrants, as described above; upon a minimum of 30 days prior written notice of redemption; if, and only if, there is an effective registration statement covering the shares of Class A common stock issuable upon exercise of the warrants and a current prospectus relating thereto available throughout the 30-day period after written notice of redemption is given; and if, and only if, the last reported sale price of our Class A common stock equals or exceeds $10.00 per share (as Table of Contents adjusted per share splits, stock dividends, reorganizations, recapitalizations and the like) on the trading day prior to the date on which we send the notice of redemption to the warrant holders. The fair market value of our Class A common stock shall mean the average last reported sale price of our Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. This redemption feature differs from the typical warrant redemption features used in other blank check offerings. No fractional shares of Class A common stock will be issued upon redemption of the warrants. If, upon redemption, a holder would be entitled to receive a fractional interest in a share, we will round down to the nearest whole number of the number of shares of Class A common stock to be issued to the holder. Please see the section entitled Description of Securities Warrants Public Stockholders Warrants for additional information. Cashless Exercise If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In determining whether to require all holders to exercise their warrants on a cashless basis, our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our stockholders of issuing the maximum number of shares of Class A common stock issuable upon the exercise of our warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value shall mean the average reported last sale price of the Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Please see the section of this prospectus entitled Description of Securities Warrants Public Stockholders Warrants for additional information. Except as set forth herein, none of the private placement warrants will be redeemable by us so long as they are held by the sponsor or its permitted transferees. Table of Contents Founder shares On July 8, 2021, our sponsor purchased 15,093,750 founder shares for an aggregate purchase price of $25,000, or approximately $0.002 per share. Prior to the initial investment in the company of $25,000 by our sponsor, the company had no assets, tangible or intangible. The per share purchase price of the founder shares was determined by dividing the amount of cash contributed to the company by the aggregate number of founder shares issued. The number of founder shares issued was determined based on the expectation that the founder shares would represent 20% of the outstanding shares after this offering. As such, our initial stockholders will collectively own 20% of our issued and outstanding shares after this offering (assuming they do not purchase any units in this offering). Prior to the completion of this offering, our sponsor will transfer 25,000 founder shares to each of our independent director nominees at their original purchase price. Up to 1,968,750 founder shares will be subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised so that our initial stockholders will maintain ownership of 20% of our common stock after this offering. The founder shares are identical to the shares of Class A common stock included in the units being sold in this offering, except that: the founder shares are shares of Class F common stock that automatically convert into shares of our Class A common stock at the time of our initial business combination, or at any time prior thereto at the option of the holder, on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described herein; only holders of the founder shares have the right to vote on the appointment of directors prior to our initial business combination; provided, however, that with respect to the election of directors in connection with a meeting of our stockholders in which a business combination is submitted to our stockholders for approval, holders of our Class A common stock and holders of our Class F common stock, voting together as a single class, will have the exclusive right to vote for the election of directors; and, prior to our initial business combination, holders of a majority of founder shares may remove transfer restrictions on founder members of the board of directors for any reason; the founder shares are subject to certain transfer restrictions, as described in more detail below; Table of Contents our sponsor, officers and directors have entered into letter agreements with us, pursuant to which they have agreed (i) to waive their redemption rights with respect to any founder shares and any public shares held by them in connection with the completion of our initial business combination and (ii) to waive their rights to liquidating distributions from the trust account with respect to any founder shares held by them if we fail to complete our initial business combination within 24 months from the closing of this offering, although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our business combination within the prescribed time frame. If we submit our initial business combination to our public stockholders for a vote, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. Our initial stockholders have agreed to vote any founder shares held by them and any public shares purchased during or after this offering in favor of our initial business combination. As a result, in addition to our initial stockholders founder shares, we would need 19,687,501 or approximately 37.5%, of the 52,500,000 public shares sold in this offering to be voted in favor of a transaction (assuming all outstanding shares are voted) in order to have our initial business combination approved (assuming the over-allotment option is not exercised); and the founder shares are subject to registration rights. Transfer restrictions on founder shares With certain limited exceptions, our initial stockholders have agreed not to transfer, assign or sell any of their founder shares until 180 days after the completion of our initial business combination. We refer to such transfer restriction throughout this prospectus as the lock-up. Founder shares conversion and anti-dilution rights The shares of Class F common stock will automatically convert into shares of our Class A common stock at the time of our initial business combination on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein. In the case that any amount of additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in this prospectus and related to the closing of the initial business Table of Contents combination the ratio at which shares of Class F common stock shall convert into shares of Class A common stock will be adjusted in connection with financing or consummating the business combination or for anti- dilution purposes (unless the holders of a majority of the outstanding shares of Class F common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class F common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of this offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with the initial business combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in the business combination). Holders of founder shares may also elect to convert their shares of Class F common stock into an equal number of shares of Class A common stock, subject to adjustment as provided above, at any time. Appointment of directors; Voting rights Prior to our initial business combination, only holders of our founder shares will have the right to vote on the appointment of directors; provided, however, that with respect to the election of directors in connection with a meeting of our stockholders in which a business combination is submitted to our stockholders for approval, holders of our Class A common stock and holders of our Class F common stock, voting together as a single class, will have the exclusive right to vote for the election of directors. Other than pursuant to the proviso in the preceding sentence, holders of the Class A common stock will not be entitled to vote on the election of directors prior to the consummation of the initial business combination. In addition, prior to the completion of an initial business combination, holders of a majority of our founder shares may remove a member of the board of directors for any reason. These provisions of our amended and restated certificate of incorporation may only be amended by approval of a majority of our Class F common stock then outstanding. With respect to any other matter submitted to a vote of our stockholders, including any vote in connection with our initial business combination, except as required by law, holders of our founder shares and holders of our public shares will vote together as a single class, with each share entitling the holder to one vote. In connection with our initial business combination, we may enter into an agreement or other arrangement with the stockholders of the target with Table of Contents respect to voting and other corporate governance matters following completion of the initial business combination, and such agreement or arrangement may provide for, or the target stockholders may require that such agreement provide for, nomination, designation or representation rights on the board of directors of the combined entity that may be not be proportionate to our stockholders or such target shareholders ownership interest in the combined company. Private placement warrants Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 8,333,333 private placement warrants (or 9,383,333 if the over-allotment option is exercised in full), each exercisable to purchase one share of our Class A common stock at $11.50 per share, at a price of $1.50 per whole warrant (approximately $12,500,000 in the aggregate or $14,075,000 in the aggregate if the over-allotment option is exercised in full) in a private placement that will occur simultaneously with the closing of this offering. Each whole private placement warrant is exercisable for one whole share of our Class A common stock at $11.50 per share. A portion of the purchase price of the private placement warrants will be added to the proceeds from this offering to be held in the trust account such that at the time of closing $525.0 million (or $603.75 million if the underwriters exercise their over-allotment option in full) will be held in the trust account. If we do not complete our initial business combination within 24 months from the closing of this offering, the proceeds from the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares (subject to the requirements of applicable law) and the private placement warrants will expire worthless. The private placement warrants will be non-redeemable (except as set forth under Description of Securities Warrants Public Stockholders Warrants Redemption of warrants for Class A common stock ) and exercisable on a cashless basis so long as they are held by the sponsor or its permitted transferees. If the private placement warrants are held by holders other than the sponsor or its permitted transferees, the private placement warrants will be redeemable by us and exercisable by the holders on the same basis as the warrants included in the units being sold in this offering. Transfer restrictions on private placement warrants The private placement warrants (including the Class A common stock issuable upon exercise of the private Table of Contents placement warrants) will not be transferable, assignable or salable until 30 days after the completion of our initial business combination (except as described under the section of this prospectus entitled Principal Stockholders Restrictions on Transfers of Founder Shares and Private Placement Warrants ). Cashless exercise of private placement warrants If holders of private placement warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering their warrants for that number of shares of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value shall mean the average reported last sale price of the Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent. The reason that we have agreed that these warrants will be exercisable on a cashless basis so long as they are held by the sponsor or its permitted transferees is because it is not known at this time whether they will be affiliated with us following a business combination. If they remain affiliated with us, their ability to sell our securities in the open market will be significantly limited. We expect to have policies in place that prohibit insiders from selling our securities except during specific periods of time. Even during such periods of time when insiders will be permitted to sell our securities, an insider cannot trade in our securities if he or she is in possession of material non-public information. Accordingly, unlike public stockholders who could sell the shares of Class A common stock issuable upon exercise of the warrants freely in the open market, the insiders could be significantly restricted from doing so. As a result, we believe that allowing the holders to exercise such warrants on a cashless basis is appropriate. Proceeds to be held in trust account The rules of Nasdaq provide that at least 90% of the gross proceeds from this offering and the sale of the private placement warrants be deposited in a trust account. Of the net proceeds of this offering and the sale of the private placement warrants, $525,000,000, or $10.00 per unit ($603,750,000, or $10.00 per unit, if the underwriters over- allotment option is exercised in full) will be placed into a U.S.-based trust account at Deutsche Bank Trust Company Americas with Computershare Trust Company, N.A. acting as trustee. These proceeds include $18,375,000 (or Table of Contents $21,131,250 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions. Except with respect to up to $900,000 per year of interest earned on the funds held in the trust account that may be released to us to fund our regulatory compliance requirements and other costs related thereto (a Regulatory Withdrawal ), plus additional amounts to pay our franchise and income tax obligations, if any, the proceeds from this offering and the sale of the private placement warrants will not be released from the trust account until the earliest of (a) the completion of our initial business combination, (b) the redemption of any public shares properly tendered in connection with a stockholder vote to amend our amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering or (ii) with respect to any other provisions relating to stockholders rights or pre-initial business combination activity and (c) the redemption of our public shares if we are unable to complete our business combination within 24 months from the closing of this offering, subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. Anticipated expenses and funding Sources Except as described above with respect to the funding of our Regulatory Withdrawals and the payment of taxes, unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. Based upon assumed interest rates, we expect the trust account to generate approximately $262,500 (assuming an interest rate of 0.05% per year and that the underwriters over-allotment option is not exercised) of interest annually. Except as described above, unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement warrants not held in the trust account, which will be approximately $515,000 in working capital after the payment of approximately $1,485,000 in expenses relating to this offering; and any loans or additional investments from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation to advance funds or invest in us, and provided that any Table of Contents such loans will not have any claim Conditions to completing our on the proceeds held in the trust account unless such proceeds are released to us upon completion of a business combination. Conditions to completing our initial business combination There is no limitation on our ability to raise funds privately or through loans in connection with our initial business combination. Our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of our assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the income earned on the trust account) at the time of the agreement to enter into the initial business combination. If our board is not able to independently determine the fair market value of the target business or businesses or we are considering an initial business combination with an affiliated entity, we will obtain an opinion from an independent investment banking firm that is a member of FINRA or an independent accounting firm. We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders or for other reasons. However, we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the business combination may collectively own a minority interest in the post business combination company, depending on valuations ascribed to the target and us in the business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test, provided that in the event that the business combination involves more than one target business, the Table of Contents 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. Permitted purchases of public shares by our affiliates If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our initial stockholders, directors, officers, advisors or their affiliates may purchase shares in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination where otherwise permissible under applicable laws, rules and regulations. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material non-public information not disclosed or if such purchases are prohibited by Regulation M under the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Redemption rights for public stockholders upon completion of our initial business Combination We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including up to $900,000 per year of interest earned on the funds held in the trust account and not previously released to us to fund our Regulatory Withdrawals and/or to pay our franchise and income taxes, divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.00 per public share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will Table of Contents pay to the underwriters. The redemption rights will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. The redemption rights will also include the requirement that a beneficial holder must check a box on the proxy card indicating whether he or she is acting in concert or as a group (as defined in Section 13d-3 of the Exchange Act) with any stockholder with respect to any public shares. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our sponsor, officers and directors have entered into letter agreements with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares held by them and any public shares they may acquire during or after this offering in connection with the completion of our business combination or otherwise. Manner of conducting redemptions We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a stockholder meeting called to approve the business combination or (ii) by means of a tender offer. The decision as to whether we will seek stockholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval under the law or stock exchange listing requirements. Asset acquisitions and stock purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding common stock or seek to amend our amended and restated certificate of incorporation would require stockholder approval. We intend to conduct redemptions without a stockholder vote pursuant to the tender offer rules of the SEC unless stockholder approval is required by law or stock exchange listing requirements or we choose to seek stockholder approval for business or other legal reasons. If a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other legal reasons, we will, pursuant to our amended and restated certificate of incorporation: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and file tender offer documents with the SEC prior to completing our initial business combination which contain Table of Contents substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Upon the public announcement of our business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase shares of our Class A common stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public stockholders not tendering more than a specified number of public shares, which number will be based on the requirement that we may not redeem public shares in an amount that would cause our net tangible assets to be less than $5,000,001 (so that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination. If, however, stockholder approval of the transaction is required by law or stock exchange listing requirements, or we decide to obtain stockholder approval for business or other legal reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and file proxy materials with the SEC. If we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the company representing a majority of the voting power of all outstanding shares of capital stock of the company entitled to vote at such meeting. Our initial stockholders will count towards this quorum and have agreed to vote their founder Table of Contents shares and any public shares purchased during or after this offering in favor of our initial business combination. For purposes of seeking approval of the majority of our outstanding shares of common stock voted, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. As a result, in addition to our initial stockholders founder shares, we would need 19,687,501 or approximately 37.5%, of the 52,500,000 public shares sold in this offering to be voted in favor of a transaction (assuming all outstanding shares are voted) in order to have our initial business combination approved (assuming the over-allotment option is not exercised). We intend to give not less than 10 days nor more than 60 days prior written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination. These quorum and voting thresholds, and the voting agreements of our initial stockholders, may make it more likely that we will consummate our initial business combination. Each public stockholder may elect to redeem its public shares irrespective of whether they vote for or against the proposed transaction. We may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to either tender their certificates to our transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up to two business days prior to the vote on the proposal to approve the business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically. We believe that this will allow our transfer agent to efficiently process any redemptions without the need for further communication or action from the redeeming public stockholders, which could delay redemptions and result in additional administrative cost. If the proposed business combination is not approved and we continue to search for a target company, we will promptly return any certificates delivered, or shares tendered electronically, by public stockholders who elected to redeem their shares. Our amended and restated certificate of incorporation provides that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 (so that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. For example, the proposed business combination may require: (i) cash consideration to be paid to the target or its owners, Table of Contents (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration we would be required to pay for all shares of Class A common stock that are validly submitted for redemption, plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination, exceeds the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all shares of Class A common stock submitted for redemption will be returned to the holders thereof. Limitation on redemption rights of stockholders holding 15% or more of the shares sold in this offering if we hold stockholder vote Notwithstanding the foregoing redemption rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering. We believe the restriction described above will discourage stockholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public stockholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us or our management at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our Table of Contents stockholders ability to vote all of their shares (including all shares held by those stockholders that hold more than 15% of the shares sold in this offering) for or against our business combination. Redemption rights in connection with proposed amendments to our amended and restated certificate of incorporation Some other blank check companies have a provision in their charter which prohibits the amendment of certain charter provisions. Our amended and restated certificate of incorporation will provide that any of its provisions related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the private placement of warrants into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein) may be amended if approved by holders of 65% of our common stock entitled to vote thereon, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of 65% of our common stock entitled to vote thereon. In all other instances, our amended and restated certificate of incorporation may be amended by holders of a majority of our outstanding common stock entitled to vote thereon, subject to applicable provisions of the Delaware General Corporation Law (the DGCL ), or applicable stock exchange rules. Our initial stockholders, who will collectively beneficially own 20% of our common stock upon the closing of this offering (assuming they do not purchase any units in this offering), will participate in any vote to amend our amended and restated certificate of incorporation and/ or trust agreement and will have the discretion to vote in any manner they choose. Our sponsor, executive officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation that would affect (i) the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering or (ii) any other provisions relating to stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then outstanding public Table of Contents shares. Our initial stockholders have entered into letter agreements with us pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and public shares held by them in connection with the completion of our initial business combination. Release of funds in trust account on closing of our initial business Combination On the completion of our initial business combination, all amounts held in the trust account will be released to us. We will use these funds to pay amounts due to any public stockholders who exercise their redemption rights as described above under Redemption rights for public stockholders upon completion of our initial business combination, to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our sponsor, officers and directors have agreed that we will have only 24 months from the closing of this offering to complete our initial business combination. If we are unable to complete our initial business combination within such 24-month period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to fund our Regulatory Withdrawals and/or to pay our franchise and income taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, Table of Contents and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our business combination within the 24-month time period. Our sponsor, officers and directors have entered into letter agreements with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to any founder shares held by them if we fail to complete our initial business combination within 24 months from the closing of this offering. However, if our initial stockholders acquire public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted 24-month time period. The underwriters have agreed to waive their rights to their deferred underwriting commission held in the trust account in the event we do not complete our initial business combination and subsequently liquidate and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. Payments to insiders There will be no restrictions on payments made to insiders. We expect that some or all of the following payments will be made to our sponsor, officers or directors, or our or their affiliates: Repayment of up to an aggregate of $450,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; Payment to an affiliate of our sponsor of $20,000 per month, for up to 24 months, for office space, utilities and secretarial and administrative support; Reimbursement of legal fees and expenses incurred by our sponsor, officers or directors in connection with our formation, the initial business combination and their services to us; Payment of fees and reimbursement of out-of-pocket expenses related to identifying, investigating and completing an initial business combination; and Table of Contents Repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into warrants, at a price of $1.50 per warrant at the option of the lender. The warrants would be identical to the private placement warrants, including as to exercise price, exercisability and exercise period. However, no such payments will be made from the proceeds of this offering held in the trust account prior to the completion of our initial business combination. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliates. Audit Committee We will establish and will maintain an audit committee, which will be composed entirely of independent directors to, among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section of this prospectus entitled Management Committees of the Board of Directors Audit Committee. Conflicts of Interest The Gores Group manages several investment vehicles. Funds managed by Gores or its affiliates may compete with us for acquisition opportunities. If these funds decide to pursue any such opportunity, we may be precluded from procuring such opportunities. In addition, investment ideas generated within Gores, including by Mr. Gores, may be suitable for both us and for a current or future Gores fund and may be directed to such investment vehicle rather than to us. Neither Gores nor members of our management team who are also employed by certain affiliates of The Gores Group have any obligation to present us with any business combination target of which they become aware, unless presented to such member solely in his or her capacity as an officer of the company. Gores and/or our management, in their capacities as officers or managing directors of Gores or in their other endeavors, may be required to present such business combination target to the related entities described above, current or future Gores investment vehicles, or third parties, before they Table of Contents present such business combination target to us. The Gores Group does not have any present intention to invest in new portfolio companies, and therefore we do not expect conflicts of interest with respect to The Gores Group. Further, any potential investment by The Gores Group would be significantly smaller than the companies that we would consider for potential business combinations, and therefore it is likely that any investment by The Gores Group would not be suitable for us, and that any investment by us would not be suitable for The Gores Group. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity. Specifically, all of our officers and certain of our directors have fiduciary and contractual duties to The Gores Group and certain companies it has invested in or managed, including Gores Holdings VII, Gores Holdings VIII, Gores Metropoulos II, Gores Technology, Gores Technology II, Gores Guggenheim and Gores Holdings X. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such entity. We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to search for an initial business combination. Our amended and restated certificate of incorporation will contain a waiver of the corporate opportunity doctrine, which provides that we renounce our interest in any corporate opportunity offered to any director or officer unless (i) such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company, (ii) such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue and (iii) the director or officer is permitted to refer the opportunity to us without violating another legal obligation. The purpose for the surrender of corporate opportunities is to allow officers, directors or other representatives with multiple business affiliations to continue to serve as an officer of our company or on our board of directors. Our officers and directors may from time to time be presented with opportunities that could benefit both another business affiliation and us. In the absence of the corporate opportunity waiver in our Table of Contents charter, certain candidates would not be able to serve as an officer or director. We believe we substantially benefit from having representatives who bring significant, relevant and valuable experience to our management, and, as a result, the corporate opportunity waiver in our amended and restated certificate of incorporation provides us with greater flexibility to attract and retain the officers and directors that we feel are the best candidates. However, the personal and financial interests of our directors and officers may influence their motivation in timely identifying and pursuing an initial business combination or completing our initial business combination. The different timelines of competing business combinations could cause our directors and officers to prioritize a different business combination over finding a suitable acquisition target for our business combination. Consequently, our directors and officers discretion in identifying and selecting a suitable target business may result in a conflict of interest when determining whether the terms, conditions and timing of a particular business combination are appropriate and in our stockholders best interest, which could negatively impact the timing for a business combination. In addition, our sponsor, officers and directors may participate in the formation of, or become an officer or director of, any other blank check company prior to completion of our initial business combination. As a result, our sponsor, officers or directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. Although we have no formal policy in place for vetting potential conflicts of interest, our board of directors will review any potential conflicts of interest on a case-by-case basis. In particular, affiliates of our sponsor are currently sponsoring seven other blank check companies, Gores Holdings VII, Gores Holdings VIII, Gores Metropoulos II, Gores Technology, Gores Technology II, Gores Guggenheim and Gores Holdings X. Gores Holdings VII, Gores Holdings VIII and Gores Holdings X may seek to complete a business combination in any location and are not focusing on any particular industry for business combinations. Gores Technology and Gores Technology II may seek to complete a business combination in any location and are focusing on a business combination in the consumer internet, enterprise software, fintech, digital health, proptech, gaming, agtech, and logistics industries. Gores Metropoulous II has entered into a definitive agreement to acquire Sonder. Gores Metropoulos II has announced that on January 14, 2022 it will hold a special meeting of the stockholders to vote on the proposed business Table of Contents combination with Sonder and expects to close the business combination in early first quarter 2022. Gores Guggenheim has entered into a definitive agreement to acquire Polestar. Gores Holdings VIII has entered into a definitive agreement to acquire Footprint International. Further, Mr. Stone, our Chief Executive Officer, serves as the Chief Executive Officer of Gores Holdings VII, Gores Holdings VIII, Gores Guggenheim and Gores Holdings X, and Mr. McBride, our Chief Financial Officer, serves as the Chief Financial Officer for Gores Holdings VII, Gores Holdings VIII, Gores Technology, Gores Technology II, Gores Guggenheim, Gores Metropoulos II and Gores Holdings X. Any such companies, including Gores Holdings VII, Gores Holdings VIII, Gores Metropoulos II, Gores Technology, Gores Technology II, Gores Guggenheim and Gores Holdings X may present additional conflicts of interest in pursuing an acquisition target. However, we do not believe that any potential conflicts with Gores Holdings VII, Gores Holdings VIII, Gores Metropoulos II, Gores Technology, Gores Technology II, Gores Guggenheim and Gores Holdings X would materially affect our ability to identify and pursue initial business combination opportunities or complete our initial business combination, because (i) our management team has significant experience in identifying and executing multiple acquisition opportunities simultaneously, and (ii) we are not limited by industry or geography in terms of the acquisition opportunities we can pursue. In addition, we do not believe that any potential conflicts exist with Gores Technology and Gores Technology II because, (i) Gores Technology and Gores Technology II intend to focus on acquisition opportunities in the consumer internet, enterprise software, fintech, digital health, proptech, gaming, agtech, and logistics industries, whereas we do not intend to limit our focus to a particular industry, (ii) Gores Technology and Gores Technology II have different Co-Chief Executive Officers than Gores Holdings IX, (iii) we expect, given the industry focus of Gores Technology and Gores Technology II, that Mr. Wilson and Mr. Fike will lead the search for business combination targets for Gores Technology and Gores Technology II, whereas Mr. Stone and Mr. Gores will lead such efforts for Gores Holdings IX, (iv) three of the four directors that will be on our board are not directors of Gores Technology or Gores Technology II, and three of the four directors on each of Gores Technology and Gores Technology II s boards will not be on our board and (v) we believe the different industry focus and the different composition of our leadership will mitigate any potential conflicts of interest with respect to Gores Technology and Gores Table of Contents Technology II. In addition, we do not believe that any potential conflicts exist with Gores Guggenheim, because two of the five directors on Gores Guggenheim s board will not be on our board and the different composition of our leadership will mitigate any potential conflicts of interest with respect to Gores Guggenheim. In addition to the above, our officers and directors are not required to commit any specified amount of time to our affairs, and, accordingly, may have conflicts of interest in allocating management time among various business activities, including selecting a business combination target and monitoring the related due diligence. See Risk Factors Our officers and directors will allocate their time to other businesses thereby causing potential conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to identify and pursue initial business combination opportunities or complete our initial business combination. Additionally, our initial stockholders have agreed to waive their redemption rights with respect to any founder shares and any public shares held by them in connection with the consummation of our initial business combination. Further, our initial stockholders have agreed to waive their redemption rights with respect to any founder shares held by them if we fail to consummate our initial business combination within 24 months after the closing of this offering. If we do not complete our initial business combination within such applicable time period, the proceeds of the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares, and the private placement warrants will expire worthless. With certain limited exceptions, the founder shares will not be transferable, assignable or salable by our initial stockholders until 180 days after the completion of our initial business combination. With certain limited exceptions, the private placement warrants and the Class A common stock underlying such warrants, will not be transferable, assignable or salable by our sponsor or its permitted transferees until 30 days after the completion of our initial business combination. Since our sponsor and officers and directors may directly or indirectly own common stock and warrants following this offering, our officers and directors may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination because of their financial interest in completing an initial business combination within 24 months after the closing of this offering. Table of Contents As more fully discussed in Management Conflicts of Interest, if any of our directors or officers becomes aware of a business combination opportunity that falls within the line of business of any entity to which he or she has pre-existing fiduciary or contractual obligations, including Gores Holdings VII, Gores Holdings VIII, Gores Metropoulos II, Gores Technology, Gores Technology II, Gores Guggenheim or Gores Holdings X, he or she may be required to present such business combination target to such entity prior to presenting such business combination target to us. Our officers, directors and director nominees currently have fiduciary duties or contractual obligations that may take priority over their duties to us. Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party (other than our independent public accountants) for services rendered or products sold to us, or by a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (i) $10.00 per public share or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the $900,000 per year of interest which may be withdrawn to fund our Regulatory Withdrawals, plus additional amounts released to us to pay our franchise and income tax obligations. This liability will not apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, then our sponsor will not be responsible to the extent of any liability for such third party claims. We have not independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that our sponsor s only assets are securities of our company. We have not asked our sponsor to reserve for such indemnification obligations. None of our officers will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses. We have also entered into a letter agreement that provides that we will indemnify our sponsor, its members and managers and their respective affiliates and control persons from any claims made by any party in respect of any investment opportunities sourced by them or any liability arising with respect to their activities in connection Table of Contents with our affairs, this offering or any business combination or services rendered to the Company or its affiliates, and that we will advance any expenses incurred in connection with any such claims. Such indemnity provides that the indemnified parties cannot access the funds held in our trust account. Risks We are a newly formed company that has conducted no operations and has generated no revenues. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision whether to invest in our securities, you should take into account not only the background of our management team, but also the special risks we face as a blank check company. This offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see the section of this prospectus entitled Proposed Business Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419. You should carefully consider these and the other risks set forth in the section of this prospectus entitled Risk Factors. Summary of Risk Factors An investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together with the other information contained in this prospectus, before making a decision to invest in our units. If any of the following events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment: We are a newly formed company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. Past performance by Gores, including our management team, and other businesses associated with our management team may not be indicative of future performance of an investment in the Company. Our public stockholders may not be afforded an opportunity to vote on our proposed business combination, which means we may complete our initial business combination even though a majority of our public stockholders do not support such a combination. If we seek stockholder approval of our initial business combination, our initial stockholders and management team have agreed to vote in favor of such initial business combination, regardless of how our public stockholders vote. Your only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash, unless we seek stockholder approval of the business combination. If we seek stockholder approval of our initial business combination, our sponsor, directors, officers, advisors and their affiliates may elect to purchase shares from public stockholders, which may influence a vote on a proposed business combination and reduce the public float of our Class A common stock. Table of Contents You will not be entitled to protections normally afforded to investors of many other blank check companies. You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. To liquidate your investment, therefore, you may be forced to sell your public shares or warrants, potentially at a loss. If the net proceeds of this offering and the sale of the private placement warrants not being held in the trust account are insufficient to allow us to operate for at least the next 24 months, we may be unable to complete our initial business combination, in which case our public stockholders may only receive $10.00 per share, or less than such amount in certain circumstances, and our warrants will expire worthless. Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the coronavirus ( COVID-19 ) outbreak and the status of debt and equity markets. The grant of registration rights to our initial stockholders may make it more difficult to complete our initial business combination, and the future exercise of such rights may adversely affect the market price of our Class A common stock. The ability of our public stockholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combination with a target. We are not required to obtain an opinion from an independent investment banking firm or from an independent accounting firm, and consequently, you may have no assurance from an independent source that the price we are paying for the business is fair to our company from a financial point of view. We may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public stockholders may only receive $10.00 per share, or less than such amount in certain circumstances, and our warrants will expire worthless. We may engage in a business combination with one or more target businesses that have relationships with entities that may be affiliated with our sponsor, officers, directors or existing holders which may raise potential conflicts of interest. Since our sponsor, officers and directors will lose their entire investment in us if our business combination is not completed, a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination. Our initial stockholders may exert a substantial influence on actions requiring a stockholder vote, potentially in a manner that you do not support. Our officers and directors will allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial business combination. Our officers, directors, security holders and their respective affiliates may have competitive pecuniary interests that conflict with our interests. Table of Contents The nominal purchase price paid by our sponsor for the founder shares may result in significant dilution to the implied value of your public shares upon the consummation of our initial business combination. The value of the founder shares following completion of our initial business combination is likely to be substantially higher than the nominal price paid for them, even if the trading price of our ordinary at such time is substantially less than $10.00 per share. The other risks and uncertainties discussed in Risk Factors and elsewhere in this prospectus. Table of Contents Summary Financial Data The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. September 30, 2021 Actual As Adjusted(1) Balance Sheet Data Working capital (deficit) $ (180,373 ) $ 507,158,465 Total assets 523,572 $ 525,533,465 Total liabilities 505,107 $ 18,375,000 Value of Class A common stock that may be redeemed in connection with our initial business combination ($10.00 per share) 525,000,000 Stockholder s equity $ 18,465 $ (31,016,535 ) (1) The as adjusted information gives effect to the sale of the units we are offering and the sale of the private placement warrants, including the application of the related gross proceeds and the payment of the estimated remaining costs from such sale and the repayment of the accrued and other liabilities required to be repaid. If no business combination is completed within 24 months from the closing of this offering, the proceeds then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to fund our Regulatory Withdrawals and/or to pay our franchise and income taxes (less up to $100,000 of interest to pay dissolution expenses), will be used to fund the redemption of our public shares. Our sponsor, officers and directors have entered into letter agreements with us, pursuant to which they have agreed to waive their rights to liquidating distributions from the trust account with respect to any founder shares held by them if we fail to complete our initial business combination within such 24 month time period. Table of Contents
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@@ -0,0 +1,954 @@
+SUMMARY FINANCIAL DATA
+
+ The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented.
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ January 31,
+2022
+
+ 
+ 
+ 
+ October 31,
+2021
+
+ 
+ 
+
+ 
+ 
+ Balance Sheet Data:
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Working capital deficiency
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+ (130,401
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+ (40,000
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Total assets
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 178,281
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 88,000
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Total liabilities
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 155,341
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 65,000
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Stockholders equity
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 22,940
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 23,000
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+
+ 27
+
+ Table of Contents
+
+ 
+ RISK FACTORS
+
+ An investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together with the other information contained in this prospectus, before making a decision to invest in our units. If any of the following events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment.
+
+ Risks Relating to our Search for, Consummation of, or Inability to Consummate, a Business Combination and Post Business Combination Risks
+
+ Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the ongoing coronavirus (COVID-19) pandemic.
+
+ The COVID-19 pandemic has resulted in a widespread health crisis that has adversely affected the economies and financial markets worldwide, and the business of any potential target business with which we consummate a business combination could be materially and adversely affected. Furthermore, we may be unable to complete a business combination if continued concerns relating to COVID-19 restrict travel, limit the ability to have meetings with potential investors or the target company s personnel, vendors and services providers are unavailable to negotiate and consummate a transaction in a timely manner. The extent to which COVID-19 impacts our search for a business combination will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others. If the disruptions posed by COVID-19 or other matters of global concern continue for an extensive period of time, our ability to consummate a business combination, or the operations of a target business with which we ultimately consummate a business combination, may be materially adversely affected.
+
+ Our public stockholders may not be afforded an opportunity to vote on our proposed initial business combination, which means we may complete our initial business combination even though a majority of our public stockholders do not support such a combination.
+
+ We may choose not to hold a stockholder vote to approve our initial business combination unless the initial business combination would require stockholder approval under applicable law or stock exchange listing requirements or if we decide to hold a stockholder vote for business or other legal reasons. Except as required by applicable law or stock exchange requirements, the decision as to whether we will seek stockholder approval of a proposed initial business combination or will allow stockholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors, such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek stockholder approval. Accordingly, we may complete our initial business combination even if holders of a majority of our public shares do not approve of the initial business combination we complete. Please see the section of this prospectus entitled Proposed Business Stockholders May Not Have the Ability to Approve Our Initial Business Combination for additional information.
+
+ If we seek stockholder approval of our initial business combination, our initial stockholders have agreed to vote in favor of such initial business combination, regardless of how our public stockholders vote.
+
+ Pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote any founder shares held by them, as well as any public shares they may acquire during or after this offering (including in open market and privately negotiated transactions), in favor of our initial business combination. As a result, in addition to our initial stockholder s founder shares, we would need only 487,501 or approximately 6.5%, of the 7,500,000 public shares sold in this offering to be voted in favor of an initial business combination (assuming only the minimum number of shares representing a quorum are voted and excluding all shares to be issued to the representative of the underwriters and/or its designees) in order to have our initial business combination approved (assuming the over-allotment option is not exercised). In the event that all shares of our outstanding common stock are voted, we would need 2,850,001 or approximately 38.0%, of the 7,500,000 public shares sold in this offering to be voted in favor of an initial business combination (excluding all shares to be issued to the representative of the underwriters and/or its designees) in order to have our initial business combination approved (assuming the over-allotment option is not exercised, and that the initial stockholders do not purchase any units in this offering or units or shares in the after-market). Our initial stockholders will own shares representing 20% of our outstanding shares of common stock immediately following the completion 
+
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+ of this offering and the private placement (assuming they do not purchase any units in this offering and excluding the representative s shares). Accordingly, if we seek stockholder approval of our initial business combination, the agreement by our initial stockholders to vote in favor of our initial business combination will increase the likelihood that we will receive the requisite stockholder approval for such initial business combination.
+
+ Your only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash, unless we seek stockholder approval of the initial business combination.
+
+ At the time of your investment in us, you will not be provided with an opportunity to evaluate the specific merits or risks of our initial business combination. Since our board of directors may complete an initial business combination without seeking stockholder approval, public stockholders may not have the right or opportunity to vote on the initial business combination, unless we seek such stockholder vote. Accordingly, if we do not seek stockholder approval and instead engage in a tender offer, your only opportunity to affect the investment decision regarding a potential business combination may be limited to exercising your redemption rights within the period of time (which will be at least 20 business days) set forth in our tender offer documents mailed to our public stockholders in which we describe our initial business combination.
+
+ The ability of our public stockholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into an initial business combination with a target.
+
+ We may seek to enter into an initial business combination agreement with a prospective target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. If too many public stockholders exercise their redemption rights, we would not be able to meet such closing condition and, as a result, would not be able to proceed with the initial business combination. Furthermore, in no event will we redeem our public shares unless our net tangible assets are at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. Consequently, if accepting all properly submitted redemption requests would cause our net tangible assets to be less than $5,000,001 upon consummation of our initial business combination and after payment of underwriters fees and commissions or such greater amount necessary to satisfy a closing condition, each as described above, we would not proceed with such redemption and the related business combination and may instead search for an alternate business combination. Prospective targets will be aware of these risks and, thus, may be reluctant to enter into an initial business combination with us.
+
+ The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure.
+
+ At the time we enter into an agreement for our initial business combination, we will not know how many stockholders may exercise their redemption rights, and therefore will need to structure the transaction based on our expectations as to the number of shares that will be submitted for redemption. If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the trust account to meet such requirements, or arrange for third party financing. In addition, if a larger number of shares are submitted for redemption than we initially expected, we may need to restructure the transaction to reserve a greater portion of the cash in the trust account or arrange for third party financing. Raising additional third-party financing may involve dilutive equity issuances or the incurrence of indebtedness at higher than desirable levels. The above considerations may limit our ability to complete the most desirable business combination available to us or optimize our capital structure. The amount of the deferred underwriting commissions payable to the underwriters will not be adjusted for any shares that are redeemed in connection with an initial business combination. The per-share amount we will distribute to stockholders who properly exercise their redemption rights will not be reduced by the deferred underwriting commission and after such redemptions, the per-share value of shares held by non-redeeming stockholders will reflect our obligation to pay the deferred underwriting commissions.
+
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+ The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your stock.
+
+ If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have a minimum amount of cash at closing, the probability that our initial business combination would be unsuccessful is increased. If our initial business combination is unsuccessful, you would not receive your pro rata portion of the trust account until we liquidate the trust account.
+
+ If you are in need of immediate liquidity, you could attempt to sell your stock in the open market; however, at such time our stock may trade at a discount to the pro rata amount per share in the trust account. In either situation, you may suffer a material loss on your investment or lose the benefit of funds expected in connection with our redemption until we liquidate or you are able to sell your stock in the open market.
+
+ Our sponsor paid an aggregate of $25,000 for the founder shares, or approximately $0.01 per founder share. As a result of this low initial price, our sponsor, its affiliates and our management team, including our independent directors, stand to make a substantial profit even if an initial business combination subsequently declines in value or is unprofitable for our public stockholders.
+
+ As a result of the low acquisition cost of our founder shares, our sponsor, its affiliates and our management team, including our independent directors, could make a substantial profit even if we select and consummate an initial business combination with an acquisition target that subsequently declines in value or is unprofitable for our public stockholders. Thus, such parties may have more of an economic incentive for us to enter into an initial business combination with a riskier, weaker-performing or financially unstable business, or an entity lacking an established record of revenues or earnings, than would be the case if such parties had paid the full offering price for their founder shares.
+
+ The value of the founder shares and private placement shares following completion of our initial business combination is likely to be substantially higher than the price paid for them, even if the trading price of our shares at such time is substantially less than $10.20 per share.
+
+ The SPAC model may not fully align the interests of our sponsor and management with those of our public stockholders. Upon the closing of this offering, assuming no exercise of the underwriters over-allotment option, our sponsor will have invested in us an aggregate of $4,287,500, comprised of the $25,000 purchase price for the founder shares and the $4,262,500 purchase price for the private placement warrants. Assuming a trading price of $10.00 per share upon consummation of our initial business combination, the 1,875,000 founder shares would have an aggregate implied value of $18.75 million. Even if the trading price of our shares was as low as approximately $__ per share, the value of the founder shares would be equal to our sponsor s initial investment in us. As a result, our sponsor is likely to be able to recoup its investment in us and make a substantial profit on that investment, even if our public shares have lost significant value. Accordingly, our management team, which owns interests in our sponsor, may have an economic incentive that differs from that of the public stockholders to pursue and consummate an initial business combination rather than to liquidate and to return all of the cash in the trust to the public stockholders, even if that business combination were with a riskier or less-established target business. For the foregoing reasons, you should consider our management team s financial incentive to complete an initial business combination when evaluating whether to redeem your shares prior to or in connection with the initial business combination.
+
+ The requirement that we complete our initial business combination within the prescribed time frame may give potential target businesses leverage over us in negotiating an initial business combination and may decrease our ability to conduct due diligence on potential business combination targets as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our stockholders.
+
+ Any potential target business with which we enter into negotiations concerning an initial business combination will be aware that we must complete our initial business combination within 12 months from the closing of this offering or during any Extension Period. Consequently, such target business may obtain leverage over us in negotiating an initial business combination, knowing that if we do not complete our initial business combination with that particular target business, we may be unable to complete our initial business combination with any target business. This risk 
+
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+ will increase as we get closer to the timeframe described above. In addition, we may have limited time to conduct due diligence and may enter into our initial business combination on terms that we would have rejected upon a more comprehensive investigation.
+
+ We may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public stockholders may only receive $10.20 per share, or less than such amount in certain circumstances, and our warrants will expire worthless.
+
+ Our amended and restated certificate of incorporation will provide that we must complete our initial business combination within 12 months from the closing of this offering or during any Extension Period. We may not be able to find a suitable target business and complete our initial business combination within such time period. Our ability to complete our initial business combination may be negatively impacted by general market conditions, volatility in the capital and debt markets and the other risks described herein. For example, if the outbreak of COVID-19 continues to grow both in the U.S. and globally and, while the extent of the impact of the outbreak on us will depend on future developments, it could limit our ability to complete our initial business combination, including as a result of increased market volatility, decreased market liquidity and third-party financing being unavailable on terms acceptable to us or at all. Additionally, the outbreak of COVID-19 may negatively impact businesses we may seek to acquire.
+
+ We may seek stockholder approval of the amendments to our amended and restated certificate of incorporation for any extension beyond 21 months if we take advantage of the full Extension Period at a meeting called for such purpose. Public stockholders will be offered the opportunity to vote on and/or redeem their shares in connection with any such extension.
+
+ If we have not completed our initial business combination within such time period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in the case of clauses (ii) and (iii) above to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. In such case, our public stockholders may only receive $10.20 per share, or less in certain circumstances, and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than $10.20 per share on the redemption of their shares. See If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share and other risk factors below.
+
+ If we seek stockholder approval of our initial business combination, our sponsor, directors, officers and their affiliates may elect to purchase shares or warrants from public stockholders, which may influence a vote on a proposed initial business combination and reduce the public float of our common stock.
+
+ If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, officers or their affiliates may under certain circumstances purchase public shares or public warrants or a combination thereof in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination, although they are under no obligation to do so. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds in the trust account will be used to purchase shares or public warrants in such transactions.
+
+ Such a purchase may include a contractual acknowledgement that such stockholder, although still the record holder of our shares is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights. In the event that our sponsor, directors, officers or their affiliates purchase shares in privately negotiated transactions from public stockholders who have already elected to exercise their redemption rights or submitted a proxy to vote against our initial business combination, such selling stockholders would be required to revoke their prior elections to redeem their shares and any proxy to vote against our initial business combination. The price per share paid in any such 
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+ transaction may be different than the amount per share a public stockholder would receive if it elected to redeem its shares in connection with our initial business combination. The purpose of such purchases could be to vote such shares in favor of the initial business combination and thereby increase the likelihood of obtaining stockholder approval of the initial business combination, or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination.
+
+ Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. We expect that any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements.
+
+ In addition, if such purchases are made, the public float of our common stock or public warrants and the number of beneficial holders of our securities may be reduced, possibly making it difficult to obtain or maintain the quotation, listing or trading of our securities on a national securities exchange.
+
+ If a stockholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for tendering its shares, such shares may not be redeemed.
+
+ We will comply with the tender offer rules or proxy rules, as applicable, when conducting redemptions in connection with our initial business combination. Despite our compliance with these rules, if a stockholder fails to receive our tender offer or proxy materials, as applicable, such stockholder may not become aware of the opportunity to redeem its shares. In addition, proxy materials or tender offer documents, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will describe the various procedures that must be complied with in order to validly tender or redeem public shares. For example, if we hold a meeting to approve a business combination, we may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to either deliver their stock certificates to our transfer agent up to two business days prior to the vote on the proposal to approve the initial business combination or to deliver their shares to the transfer agent electronically. In the event that a stockholder fails to comply with these or any other procedures disclosed in the proxy or tender offer materials, as applicable, its shares may not be redeemed. See the section of this prospectus entitled Proposed Business Redemption Rights for Public Stockholders upon Completion of our Initial Business Combination Tendering Stock Certificates in Connection with Redemption Rights. 
+
+ You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. To liquidate your investment, therefore, you may be forced to sell your public shares or warrants, potentially at a loss.
+
+ Our public stockholders will be entitled to receive funds from the trust account only upon the earliest to occur of: (i) our completion of an initial business combination, and then only in connection with those shares of common stock that such stockholder properly elected to redeem, subject to the limitations described herein, (ii) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain amendments to our amended and restated certificate of incorporation prior thereto or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering or during any Extension Period or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity, and (iii) the redemption of our public shares if we are unable to complete an initial business combination within 12 months from the closing of this offering or during any Extension Period, subject to applicable law and as further described herein. In no other circumstances will a public stockholder have any right or interest of any kind in the trust account. Holders of warrants will not have any right to the proceeds held in the trust account with respect to the warrants. Accordingly, to liquidate your investment, you may be forced to sell your public shares or warrants, potentially at a loss.
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+ You will not be entitled to protections normally afforded to investors of many other blank check companies.
+
+ Since the net proceeds of this offering and the sale of the placement warrants are intended to be used to complete an initial business combination with a target business that has not been identified, we may be deemed to be a blank check company under the United States securities laws. However, because our securities will be listed on a national securities exchange, we are exempt from rules promulgated by the SEC to protect investors in blank check companies, such as Rule 419. Accordingly, investors will not be afforded the benefits or protections of those rules. Among other things, this means our units will be immediately tradable and we may have a longer period of time to complete our business combination than do companies subject to Rule 419. Moreover, if this offering were subject to Rule 419, that rule would prohibit the release of any interest earned on funds held in the trust account to us unless and until the funds in the trust account were released to us in connection with our completion of an initial business combination. For a more detailed comparison of our offering to offerings that comply with Rule 419, please see the section of this prospectus entitled Proposed Business Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419. 
+
+ If we seek stockholder approval of our initial business combination and we do not conduct redemptions pursuant to the tender offer rules, and if you or a group of stockholders are deemed to hold in excess of 15% of our common stock, you will lose the ability to redeem all such shares in excess of 15% of our common stock.
+
+ If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect to more than an aggregate of 15% of the shares sold in this offering without our prior consent, which we refer to as the Excess Shares. However, we would not be restricting our stockholders ability to vote all of their shares (including Excess Shares) for or against our initial business combination. Your inability to redeem the Excess Shares will reduce your influence over our ability to complete our initial business combination and you could suffer a material loss on your investment in us if you sell Excess Shares in open market transactions. Additionally, you will not receive redemption distributions with respect to the Excess Shares if we complete our initial business combination. And as a result, you will continue to hold that number of shares exceeding 15% and, in order to dispose of such shares, would be required to sell your shares in open market transactions, potentially at a loss.
+
+ Because of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share on our redemption of our public shares, or less than such amount in certain circumstances, and our warrants will expire worthless.
+
+ We expect to encounter intense competition from other entities having a business objective similar to ours, including private investors (which may be individuals or investment partnerships), other blank check companies and other entities competing for the types of businesses we intend to acquire. Many of these individuals and entities are well-established and have extensive experience in identifying and effecting, directly or indirectly, acquisitions of companies operating in or providing services to various industries. Many of these competitors possess greater technical, human and other resources or more industry knowledge than we do, and our financial resources will be relatively limited when contrasted with those of many of these competitors. While we believe there are numerous target businesses we could potentially acquire with the net proceeds of this offering and the sale of the placement warrants, our ability to compete with respect to the acquisition of certain target businesses that are sizable will be limited by our available financial resources. This inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target businesses. Furthermore, because we are obligated to pay cash for the shares of common stock which our public stockholders redeem in connection with our initial business combination, target companies will be aware that this may reduce the resources available to us for our initial business combination. This may place us at a competitive disadvantage in successfully negotiating and completing an initial business combination. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share on the liquidation of our trust account, or less in certain circumstances, and our warrants will expire worthless. 
+
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+ In certain circumstances, our public stockholders may receive less than $10.20 per share upon our liquidation. See If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share and other risk factors herein.
+
+ If the net proceeds of this offering and the sale of the placement warrants not being held in the trust account are insufficient to allow us to operate for at least the 12 months and during any Extension Period following the closing of this offering, we may be unable to complete our initial business combination, in which case our public stockholders may only receive $10.20 per share, or less than such amount in certain circumstances, and our warrants will expire worthless.
+
+ The funds available to us outside of the trust account to fund our working capital requirements may not be sufficient to allow us to operate for at least the 12 months following the closing of this offering, or up to 21 months, subject to the Extension Period, assuming that our initial business combination is not completed during that time. We believe that, upon the closing of this offering, the funds available to us outside of the trust account will be sufficient to allow us to operate for at least the 12 months following such closing, or up to 21 months, subject to the Extension Period; however, we cannot assure you that our estimate is accurate.
+
+ If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share on the liquidation of our trust account, or less in certain circumstances, and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than $10.20 per share upon our liquidation. See If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share and other risk factors herein.
+
+ If the net proceeds of this offering and the sale of the placement warrants not being held in the trust account are insufficient, it could limit the amount available to fund our search for a target business or businesses and complete our initial business combination and we will depend on loans from our sponsor or management team to fund our search for an initial business combination, to pay our taxes and to complete our initial business combination. If we are unable to obtain these loans, we may be unable to complete our initial business combination.
+
+ Of the net proceeds of this offering and the sale of the placement warrants, only approximately $1,056,750 will be available to us initially outside the trust account to fund our working capital requirements. In the event that our offering expenses exceed our estimate of $955,750, we may fund such excess with funds not to be held in the trust account. In such case, the amount of funds we intend to be held outside the trust account would decrease by a corresponding amount. The amount held in the trust account will not be impacted as a result of such increase or decrease. Conversely, in the event that the offering expenses are less than our estimate of $955,750, the amount of funds we intend to be held outside the trust account would increase by a corresponding amount. If we are required to seek additional capital, we would need to borrow funds from our sponsor, management team or other third parties to operate or may be forced to liquidate. None of our sponsor, members of our management team nor any of their affiliates is under any obligation to advance funds to us in such circumstances. Any such advances would be repaid only from funds held outside the trust account or from funds released to us upon completion of our initial business combination. Up to $1,500,000 of such loans may be convertible into warrants, at a price of $1.00 per warrant at the option of the lender, upon consummation of our initial business combination. The warrants would be identical to the placement warrants. Prior to the completion of our initial business combination, we do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our trust account. If we are unable to obtain these loans, we may be unable to complete our initial business combination. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the trust account. Consequently, our public stockholders may only receive approximately $10.20 per share on our redemption of our public shares, or less in certain circumstances, and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than $10.20 per share on the redemption of their shares. See If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share and other risk factors below.
+
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+ Subsequent to the completion of our initial business combination, we may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on our financial condition, results of operations and our share price, which could cause you to lose some or all of your investment.
+
+ Even if we conduct extensive due diligence on a target business with which we combine, we cannot assure you that this diligence will surface all material issues that may be present inside a particular target business, that it would be possible to uncover all material issues through a customary amount of due diligence, or that factors outside of the target business and outside of our control will not later arise. As a result of these factors, we may be forced to later write-down or write-off assets, restructure our operations, or incur impairment or other charges that could result in our reporting losses. Even if our due diligence successfully identifies certain risks, unexpected risks may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though these charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative market perceptions about us or our securities. In addition, charges of this nature may cause us to violate net worth or other covenants to which we may be subject as a result of assuming pre-existing debt held by a target business or by virtue of our obtaining debt financing to partially finance the initial business combination. Accordingly, any stockholders who choose to remain stockholders following the initial business combination could suffer a reduction in the value of their shares. Such stockholders are unlikely to have a remedy for such reduction in value unless they are able to successfully claim that the reduction was due to the breach by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they are able to successfully bring a private claim under securities laws that the proxy solicitation or tender offer materials, as applicable, relating to the initial business combination constituted an actionable material misstatement or omission.
+
+ If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share.
+
+ Our placing of funds in the trust account may not protect those funds from third-party claims against us. Although we will seek to have all vendors, service providers, prospective target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our public stockholders, such parties may not execute such agreements, or even if they execute such agreements they may not be prevented from bringing claims against the trust account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain advantage with respect to a claim against our assets, including the funds held in the trust account. If any third party refuses to execute an agreement waiving such claims to the monies held in the trust account, our management will perform an analysis of the alternatives available to it and will only enter into an agreement with a third party that has not executed a waiver if management believes that such third party s engagement would be significantly more beneficial to us than any alternative. Certain parties, including MaloneBailey, LLP ( Malone ), our independent registered public accounting firm, and the underwriters of this offering, will not execute agreements with us waiving such claims to the monies held in the trust account.
+
+ Examples of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third party consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver. In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason. Upon redemption of our public shares, if we are unable to complete our initial business combination within the prescribed timeframe, or upon the exercise of a redemption right in connection with our initial business combination, we will be required to provide for payment of claims of creditors that were not waived that may be brought against us within the 10 years following redemption. Accordingly, the per-share redemption amount received by public stockholders could be less than the $10.20 per share initially held in the trust account, due to claims of such creditors. Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business with which we have entered into a written letter of intent, confidentiality or similar agreement or business combination agreement, reduce the amount of funds in the trust account to below the lesser of (i) $10.20 per public share and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.20 per share due to reductions in the value of the trust assets, less 
+
+ 
+
+ 35
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+
+ 
+ taxes payable, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. However, we have not asked our sponsor to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that our sponsor s only assets are securities of our company. Therefore, we believe it is unlikely that our sponsor would be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses.
+
+ Our directors may decide not to enforce the indemnification obligations of our sponsor, resulting in a reduction in the amount of funds in the trust account available for distribution to our public stockholders.
+
+ In the event that the proceeds in the trust account are reduced below the lesser of (i) $10.20 per share and (ii) the actual amount per share held in the trust account as of the date of the liquidation of the trust account if less than $10.20 per share due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes, and our sponsor asserts that it is unable to satisfy its obligations or that it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take legal action against our sponsor to enforce its indemnification obligations.
+
+ While we currently expect that our independent directors would take legal action on our behalf against our sponsor to enforce its indemnification obligations to us, it is possible that our independent directors in exercising their business judgment and subject to their fiduciary duties may choose not to do so in any particular instance if, for example, the cost of such legal action is deemed by the independent directors to be too high relative to the amount recoverable or if the independent directors determine that a favorable outcome is not likely. If our independent directors choose not to enforce these indemnification obligations, the amount of funds in the trust account available for distribution to our public stockholders may be reduced below $10.20 per share.
+
+ We may not have sufficient funds to satisfy indemnification claims of our directors and executive officers.
+
+ We have agreed to indemnify our officers and directors to the fullest extent permitted by law. However, our officers and directors have agreed to waive any right, title, interest or claim of any kind in or to any monies in the trust account and to not seek recourse against the trust account for any reason whatsoever. Accordingly, any indemnification provided will be able to be satisfied by us only if (i) we have sufficient funds outside of the trust account or (ii) we consummate an initial business combination. Our obligation to indemnify our officers and directors may discourage stockholders from bringing a lawsuit against our officers or directors for breach of their fiduciary duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against our officers and directors, even though such an action, if successful, might otherwise benefit us and our stockholders. Furthermore, a stockholder s investment may be adversely affected to the extent we pay the costs of settlement and damage awards against our officers and directors pursuant to these indemnification provisions.
+
+ If, after we distribute the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and we and our board may be exposed to claims of punitive damages.
+
+ If, after we distribute the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a preferential transfer or a fraudulent conveyance. As a result, a bankruptcy court could seek to recover some or all amounts received by our stockholders. In addition, our board of directors may be viewed as having breached its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing itself and us to claims of punitive damages, by paying public stockholders from the trust account prior to addressing the claims of creditors.
+
+ 
+
+ 36
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+
+ 
+ If, before distributing the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our stockholders and the per-share amount that would otherwise be received by our stockholders in connection with our liquidation may be reduced.
+
+ If, before distributing the proceeds in the trust account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our stockholders. To the extent any bankruptcy claims deplete the trust account, the per-share amount that would otherwise be received by our stockholders in connection with our liquidation may be reduced.
+
+ If we are deemed to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements and our activities may be restricted, which may make it difficult for us to complete our initial business combination.
+
+ If we are deemed to be an investment company under the Investment Company Act, our activities may be restricted, including:
+
+ restrictions on the nature of our investments; and
+
+ restrictions on the issuance of securities, each of which may make it difficult for us to complete our initial business combination.
+
+ In addition, we may have imposed upon us burdensome requirements, including:
+
+ registration as an investment company with the SEC;
+
+ adoption of a specific form of corporate structure; and
+
+ reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations that we are currently not subject to.
+
+ In order not to be regulated as an investment company under the Investment Company Act, unless we can qualify for an exclusion, we must ensure that we are engaged primarily in a business other than investing, reinvesting or trading in securities and that our activities do not include investing, reinvesting, owning, holding or trading investment securities constituting more than 40% of our total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis. Our business will be to identify and complete an initial business combination and thereafter to operate the post-transaction business or assets for the long term. We do not plan to buy businesses or assets with a view to resale or profit from their resale. We do not plan to buy unrelated businesses or assets or to be a passive investor.
+
+ We do not believe that our anticipated principal activities will subject us to the Investment Company Act. To this end, the proceeds held in the trust account may only be invested in United States government securities within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S. government treasury obligations. Pursuant to the trust agreement, the trustee is not permitted to invest in other securities or assets. By restricting the investment of the proceeds to these instruments, and by having a business plan targeted at acquiring and growing businesses for the long term (rather than on buying and selling minority portions of businesses in the manner of a merchant bank or private equity fund), we intend to avoid being deemed an investment company within the meaning of the Investment Company Act. This offering is not intended for persons who are seeking a return on investments in government securities or investment securities. The trust account is intended as a holding place for funds pending the earliest to occur of: (i) the completion of our initial business combination; (ii) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain amendments to our charter prior thereto or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering or during any Extension Period or (B) with respect to any other 
+
+ 
+
+ 37
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+ Table of Contents
+
+ 
+ provision relating to stockholders rights or pre-initial business combination activity; or (iii) absent an initial business combination within 12 months from the closing of this offering or during any Extension Period, our return of the funds held in the trust account to our public stockholders as part of our redemption of the public shares. If we do not invest the proceeds as discussed above, we may be deemed to be subject to the Investment Company Act. If we were deemed to be subject to the Investment Company Act, compliance with these additional regulatory burdens would require additional expenses for which we have not allotted funds and may hinder our ability to complete an initial business combination or may result in our liquidation. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share on the liquidation of our trust account, or less in certain circumstances, and our warrants will expire worthless.
+
+ In addition to the foregoing, we are aware of litigation against special purpose acquisition companies asserting that notwithstanding the foregoing, those special purpose acquisition companies should be considered investment companies. Although we believe that these claims are without merit, we cannot guarantee that we will not be deemed to be an investment company and thus subject to the Investment Company Act. If we were deemed to be subject to the Investment Company Act, compliance with these additional regulatory burdens would require additional expenses for which we have not allotted funds and may hinder our ability to complete an initial business combination or may result in our liquidation. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share on the liquidation of our trust account and our warrants will expire worthless.
+
+ Furthermore, on March 30, 2022, the SEC issued proposed rules relating to, among other matters, the extent to which SPACs could become subject to regulation under the Investment Company Act. The SEC s proposed rule under the Investment Company Act would provide a safe harbor for SPACs from the definition of investment company under Section 3(a)(1)(A) of the Investment Company Act, provided that they satisfy certain conditions that limit a SPAC s duration, asset composition, business purpose and activities. The duration component of the proposed safe harbor rule would require a SPAC to file a report on Form 8-K with the Commission announcing that it has entered into an agreement with the target company (or companies) to engage in an initial business combination no later than 18 months after the effective date of the SPAC s registration statement for its initial public offering. The SPAC would then be required to complete its initial business combination no later than 24 months after the effective date of its registration statement for its initial public offering. The proposed safe harbor rule has not yet been adopted, and one or more elements of the proposed safe harbor rule may not be adopted or may be adopted in a revised form. Nevertheless, we intend to comply with the terms of the proposed safe harbor rule, including the duration component of that rule, when and if adopted. As a result, we do not believe that the SEC would deem us to be an investment company for purposes of the Investment Company Act. However, if we were deemed to be an investment company for purposes of the Investment Company Act, compliance with these additional regulatory burdens would require additional expenses for which we have not allotted funds and could increase the costs and time needed to complete a business combination or impair our ability to complete a business combination. If we have not completed our initial business combination within the required time period, our public stockholders may receive only approximately $10.20 per share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless.
+
+ Our stockholders may be held liable for claims by third parties against us to the extent of distributions received by them upon redemption of their shares.
+
+ Under the DGCL, stockholders may be held liable for claims by third parties against a corporation to the extent of distributions received by them in a dissolution. The pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination within 12 months from the closing of this offering or during any Extension Period, may be considered a liquidating distribution under Delaware law. If a corporation complies with certain procedures set forth in Section 280 of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during which any third-party claims can be brought against the corporation, a 90-day period during which the corporation may reject any claims brought, and an additional 150-day waiting period before any liquidating distributions are made to stockholders, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would be barred after the third anniversary of the dissolution. However, it is our intention to redeem our public shares as soon as reasonably possible following the 18th month following the closing of this offering, or during any Extension Period in the event we do not complete our initial business combination and, therefore, we do not intend to comply with the foregoing procedures.
+
+ 
+
+ 38
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+ Table of Contents
+
+ 
+ Because we will not be complying with Section 280, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us at such time that will provide for our payment of all existing and pending claims or claims that may be potentially brought against us within the 10 years following our dissolution. However, because we are a blank check company, rather than an operating company, and our operations will be limited to searching for prospective target businesses to acquire, the only likely claims to arise would be from our vendors (such as lawyers, investment bankers, etc.) or prospective target businesses. If our plan of distribution complies with Section 281(b) of the DGCL, any liability of stockholders with respect to a liquidating distribution is limited to the lesser of such stockholder s pro rata share of the claim or the amount distributed to the stockholder, and any liability of the stockholder would likely be barred after the third anniversary of the dissolution. We cannot assure you that we will properly assess all claims that may be potentially brought against us. As such, our stockholders could potentially be liable for any claims to the extent of distributions received by them (but no more) and any liability of our stockholders may extend beyond the third anniversary of such date. Furthermore, if the pro rata portion of our trust account distributed to our public stockholders upon the redemption of our public shares in the event we do not complete our initial business combination within 12 months following the closing of this offering or during any Extension Period is not considered a liquidating distribution under Delaware law and such redemption distribution is deemed to be unlawful (potentially due to the imposition of legal proceedings that a party may bring or due to other circumstances that are currently unknown), then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidating distribution.
+
+ We may not hold an annual meeting of stockholders until after the consummation of our initial business combination, which could delay the opportunity for our stockholders to elect directors.
+
+ In accordance with Nasdaq corporate governance requirements, we are not required to hold an annual meeting until no later than one year after our first fiscal year end following our listing on Nasdaq.
+
+ Under Section 211(b) of the DGCL, we are, however, required to hold an annual meeting of stockholders for the purposes of electing directors in accordance with our bylaws unless such election is made by written consent in lieu of such a meeting. We may not hold an annual meeting of stockholders to elect new directors prior to the consummation of our initial business combination, and thus we may not be in compliance with Section 211(b) of the DGCL, which requires an annual meeting. Therefore, if our stockholders want us to hold an annual meeting prior to the consummation of our initial business combination, they may attempt to force us to hold one by submitting an application to the Delaware Court of Chancery in accordance with Section 211(c) of the DGCL.
+
+ The grant of registration rights to our sponsor, holders of our placement warrants and representative shares may make it more difficult to complete our initial business combination, and the future exercise of such rights may adversely affect the market price of our common stock.
+
+ Pursuant to an agreement to be entered into concurrently with the issuance and sale of the securities in this offering, our sponsor, holders of our placement warrants, holders of the representative shares and their permitted transferees can demand that we register their securities. We will bear the cost of registering these securities. The registration and availability of such a significant number of securities for trading in the public market may have an adverse effect on the market price of our common stock. In addition, the existence of the registration rights may make our initial business combination more costly or difficult to conclude. This is because the stockholders of the target business may increase the equity stake they seek in the combined entity or ask for more cash consideration to offset the negative impact on the market price of our common shares that is expected when the common stock owned by our sponsor, holders of our placement warrants or holders of our working capital loans or their respective permitted transferees are registered.
+
+ Because we are neither limited to evaluating a target business in a particular industry sector nor have we selected any specific target businesses with which to pursue our initial business combination, you will be unable to ascertain the merits or risks of any particular target business s operations.
+
+ Because we have not yet selected or approached any specific target business with respect to a business combination, there is no basis to evaluate the possible merits or risks of any particular target business s operations, results of operations, cash flows, liquidity, financial condition or prospects. To the extent we complete our initial business combination, we may be affected by numerous risks inherent in the business operations with which we combine. For example, if we combine with a financially unstable business or an entity lacking an established record of 
+
+ 
+
+ 39
+
+ Table of Contents
+
+ 
+ sales or earnings, we may be affected by the risks inherent in the business and operations of a financially unstable or a development stage entity. Although our officers and directors will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all of the significant risk factors or that we will have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability to control or reduce the chances that those risks will adversely impact a target business. We also cannot assure you that an investment in our units will ultimately prove to be more favorable to investors than a direct investment, if such opportunity were available, in a business combination target. Accordingly, any stockholders who choose to remain stockholders following our initial business combination could suffer a reduction in the value of their securities. Such stockholders are unlikely to have a remedy for such reduction in value unless they are able to successfully claim that the reduction was due to the breach by our officers or directors of a duty of care or other fiduciary duty owed to them, or if they are able to successfully bring a private claim under securities laws that the proxy solicitation or tender offer materials, as applicable, relating to the business combination contained an actionable material misstatement or material omission.
+
+ We may seek business combination opportunities in industries or sectors which may or may not be outside of our management s area of expertise.
+
+ Although we intend to focus on identifying high growth target businesses that are headquartered in Latin America, we will consider an initial business combination outside of our management s area of expertise if an initial business combination candidate is presented to us and we determine that such candidate offers an attractive business combination opportunity for our company or we are unable to identify a suitable candidate in the pharmaceutical and medical devices sectors after having expanded a reasonable amount of time and effort in an attempt to do so. Although our management will endeavor to evaluate the risks inherent in any particular business combination candidate, we cannot assure you that we will adequately ascertain or assess all of the significant risk factors. We also cannot assure you that an investment in our units will not ultimately prove to be less favorable to investors in this offering than a direct investment, if an opportunity were available, in an initial business combination candidate. In the event we elect to pursue a business combination outside of the areas of our management s expertise, our management s expertise may not be directly applicable to its evaluation or operation, and the information contained in this prospectus regarding the areas of our management s expertise would not be relevant to an understanding of the business that we elect to acquire. As a result, our management may not be able to adequately ascertain or assess all of the significant risk factors. Accordingly, any stockholders who choose to remain stockholders following our initial business combination could suffer a reduction in the value of their shares. Such stockholders are unlikely to have a remedy for such reduction in value.
+
+ Although we have identified general criteria and guidelines that we believe are important in evaluating prospective target businesses, we may enter into our initial business combination with a target that does not meet such criteria and guidelines, and as a result, the target business with which we enter into our initial business combination may not have attributes entirely consistent with our general criteria and guidelines.
+
+ Although we have identified general criteria and guidelines for evaluating prospective target businesses, it is possible that a target business with which we enter into our initial business combination will not have all of these positive attributes. If we complete our initial business combination with a target that does not meet some or all of these guidelines, such combination may not be as successful as a combination with a business that does meet all of our general criteria and guidelines. In addition, if we announce a prospective business combination with a target that does not meet our general criteria and guidelines, a greater number of stockholders may exercise their redemption rights, which may make it difficult for us to meet any closing condition with a target business that requires us to have a minimum net worth or a certain amount of cash. In addition, if stockholder approval of the transaction is required by applicable law or stock exchange requirements, or we decide to obtain stockholder approval for business or other legal reasons, it may be more difficult for us to attain stockholder approval of our initial business combination if the target business does not meet our general criteria and guidelines. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share on the liquidation of our trust account, or less in certain circumstances, and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than $10.20 per share on the redemption of their shares. See If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share and other risk factors herein.
+
+ 
+
+ 40
+
+ Table of Contents
+
+ 
+ We may seek business combination opportunities with a financially unstable business or an entity lacking an established record of revenue, cash flow or earnings, which could subject us to volatile revenues, cash flows or earnings or difficulty in retaining key personnel.
+
+ To the extent we complete our initial business combination with a financially unstable business or an entity lacking an established record of revenues or earnings, we may be affected by numerous risks inherent in the operations of the business with which we combine. These risks include volatile revenues or earnings and difficulties in obtaining and retaining key personnel. Although our officers and directors will endeavor to evaluate the risks inherent in a particular target business, we may not be able to properly ascertain or assess all of the significant risk factors and we may not have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability to control or reduce the chances that those risks will adversely impact a target business.
+
+ We are not required to obtain a fairness opinion and consequently, you may have no assurance from an independent source that the price we are paying for the business is fair to our company from a financial point of view.
+
+ Unless we complete our initial business combination with an affiliated entity or our board cannot independently determine the fair market value of the target business or businesses, we are not required to obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions that the price we are paying is fair to our company from a financial point of view. If no opinion is obtained, our stockholders will be relying on the judgment of our board of directors, who will determine fair market value based on standards generally accepted by the financial community. Such standards used will be disclosed in our proxy materials or tender offer documents, as applicable, related to our initial business combination.
+
+ Resources could be wasted in researching business combinations that are not completed, which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share, or less than such amount in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless.
+
+ We anticipate that the investigation of each specific target business and the negotiation, drafting and execution of relevant agreements, disclosure documents and other instruments will require substantial management time and attention and substantial costs for accountants, attorneys, consultants and others. If we decide not to complete a specific initial business combination, the costs incurred up to that point for the proposed transaction likely would not be recoverable. Furthermore, if we reach an agreement relating to a specific target business, we may fail to complete our initial business combination for any number of reasons including those beyond our control. Any such event will result in a loss to us of the related costs incurred which could materially adversely affect subsequent attempts to locate and acquire or merge with another business.
+
+ If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share on the liquidation of our trust account, or less in certain circumstances, and our warrants will expire worthless. In certain circumstances, our public stockholders may receive less than $10.20 per share on the redemption of their shares. See If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share and other risk factors herein.
+
+ We may have a limited ability to assess the management of a prospective target business and, as a result, may effect our initial business combination with a target business whose management may not have the skills, qualifications or abilities to manage a public company, which could, in turn, negatively impact the value of our stockholders investment in us.
+
+ When evaluating the desirability of effecting our initial business combination with a prospective target business, our ability to assess the target business s management may be limited due to a lack of time, resources or information. Our assessment of the capabilities of the target s management, therefore, may prove to be incorrect and such management may lack the skills, qualifications or abilities we suspected. Should the target s management not possess the skills, qualifications or abilities necessary to manage a public company, the operations and profitability of the post-combination business may be negatively impacted. Accordingly, any stockholders who choose to remain stockholders following the initial business combination could suffer a reduction in the value of their shares. Such stockholders are unlikely to have a remedy for such reduction in value.
+
+ 
+
+ 41
+
+ Table of Contents
+
+ 
+ We may issue notes or other debt securities, or otherwise incur substantial debt, to complete an initial business combination, which may adversely affect our leverage and financial condition and thus negatively impact the value of our stockholders investment in us.
+
+ Although we have no commitments as of the date of this prospectus to issue any notes or other debt securities, or to otherwise incur outstanding debt following this offering, we may choose to incur substantial debt to complete our initial business combination. We have agreed that we will not incur any indebtedness unless we have obtained from the lender a waiver of any right, title, interest or claim of any kind in or to the monies held in the trust account. As such, no issuance of debt will affect the per-share amount available for redemption from the trust account. Nevertheless, the incurrence of debt could have a variety of negative effects, including:
+
+ default and foreclosure on our assets if our operating revenues after an initial business combination are insufficient to repay our debt obligations;
+
+ acceleration of our obligations to repay the indebtedness even if we make all principal and interest payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a waiver or renegotiation of that covenant;
+
+ our immediate payment of all principal and accrued interest, if any, if the debt security is payable on demand;
+
+ our inability to obtain necessary additional financing if the debt security contains covenants restricting our ability to obtain such financing while the debt security is outstanding;
+
+ our inability to pay dividends on our common stock;
+
+ using a substantial portion of our cash flow to pay principal and interest on our debt, which will reduce the funds available for dividends on our common stock if declared, our ability to pay expenses, make capital expenditures and acquisitions, and fund other general corporate purposes;
+
+ limitations on our flexibility in planning for and reacting to changes in our business and in the industry in which we operate;
+
+ increased vulnerability to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation;
+
+ limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions, debt service requirements, and execution of our strategy; and
+
+ other disadvantages compared to our competitors who have less debt.
+
+ We may issue our shares to investors in connection with our initial business combination at a price that is less than the prevailing market price of our shares at that time.
+
+ In connection with our initial business combination, we may issue shares to investors in private placement transactions (so-called PIPE transactions) at a price of $10.20 per share or less or which approximates the per-share amounts in our trust account at such time. The purpose of such issuances will be to enable us to provide sufficient liquidity to the post-business combination entity. The price of the shares we issue may therefore be less, and potentially significantly less, than the market price for our shares at such time.
+
+ We may only be able to complete one business combination with the proceeds of this offering, the sale of the placement warrants, which will cause us to be solely dependent on a single business which may have a limited number of services and limited operating activities. This lack of diversification may negatively impact our operating results and profitability.
+
+ Of the net proceeds from this offering and the sale of the placement warrants, $76,500,000 (or $87,975,000 if the underwriters over-allotment option is exercised in full) will be available to complete our initial business combination and pay related fees and expenses (which includes up to $2,437,500, or up to $2,803,125 if the over-allotment option is exercised in full, for the payment of deferred underwriting commissions).
+
+ 
+
+ 42
+
+ Table of Contents
+
+ 
+ We may effectuate our initial business combination with a single target business or multiple target businesses simultaneously or within a short period of time. However, we may not be able to effectuate our initial business combination with more than one target business because of various factors, including the existence of complex accounting issues and the requirement that we prepare and file pro forma financial statements with the SEC that present operating results and the financial condition of several target businesses as if they had been operated on a combined basis. By completing our initial business combination with only a single entity, our lack of diversification may subject us to numerous economic, competitive and regulatory developments. Further, we would not be able to diversify our operations or benefit from the possible spreading of risks or offsetting of losses, unlike other entities which may have the resources to complete several business combinations in different industries or different areas of a single industry. In addition, we intend to focus our search for an initial business combination in a single industry. Accordingly, the prospects for our success may be:
+
+ solely dependent upon the performance of a single business, property or asset, or
+
+ dependent upon the development or market acceptance of a single or limited number of products, processes or services.
+
+ This lack of diversification may subject us to numerous economic, competitive and regulatory risks, any or all of which may have a substantial adverse impact upon the particular industry in which we may operate subsequent to our initial business combination.
+
+ We may attempt to simultaneously complete business combinations with multiple prospective targets, which may hinder our ability to complete our initial business combination and give rise to increased costs and risks that could negatively impact our operations and profitability.
+
+ If we determine to simultaneously acquire several businesses that are owned by different sellers, we will need for each of such sellers to agree that our purchase of its business is contingent on the simultaneous closings of the other business combinations, which may make it more difficult for us, and delay our ability, to complete our initial business combination. We do not, however, intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. With multiple business combinations, we could also face additional risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence investigations (if there are multiple sellers) and the additional risks associated with the subsequent assimilation of the operations and services or products of the acquired companies in a single operating business. If we are unable to adequately address these risks, it could negatively impact our profitability and results of operations.
+
+ We may attempt to complete our initial business combination with a private company about which little information is available, which may result in an initial business combination with a company that is not as profitable as we suspected, if at all.
+
+ In pursuing our initial business combination strategy, we may seek to effectuate our initial business combination with a privately held company. Very little public information generally exists about private companies, and we could be required to make our decision on whether to pursue a potential initial business combination on the basis of limited information, which may result in an initial business combination with a company that is not as profitable as we suspected, if at all.
+
+ Our management may not be able to maintain control of a target business after our initial business combination.
+
+ We may structure an initial business combination so that the post-transaction company in which our public stockholders own shares will own less than 100% of the equity interests or assets of a target business, although we intend to only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for us not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post business combination company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares of common stock in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% interest in the target. However, as a result 
+
+ 
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+ of the issuance of a substantial number of new shares of common stock, our stockholders immediately prior to such transaction could own less than a majority of our outstanding shares of common stock subsequent to such transaction. In addition, other minority stockholders may subsequently combine their holdings resulting in a single person or group obtaining a larger share of the company s stock than we initially acquired. Accordingly, this may make it more likely that our management will not be able to maintain our control of the target business. We cannot provide assurance that, upon loss of control of a target business, new management will possess the skills, qualifications or abilities necessary to profitably operate such business.
+
+ We do not have a specified maximum redemption threshold. The absence of such a redemption threshold may make it possible for us to complete an initial business combination with which a substantial majority of our stockholders do not agree.
+
+ Our amended and restated certificate of incorporation will not provide a specified maximum redemption threshold, except that in no event will we redeem our public shares unless our net tangible assets are at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. As a result, we may be able to complete our initial business combination even though a substantial majority of our public stockholders do not agree with the transaction and have redeemed their shares or, if we seek stockholder approval of our initial business combination and do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, have entered into privately negotiated agreements to sell their shares to our sponsor, officers, directors or their affiliates. In the event the aggregate cash consideration we would be required to pay for all shares of common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will not complete the initial business combination or redeem any shares, all shares of common stock submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate business combination.
+
+ In order to effectuate an initial business combination, blank check companies have, in the recent past, amended various provisions of their charters and other governing instruments, including their warrant agreements. We cannot assure you that we will not seek to amend our amended and restated certificate of incorporation or governing instruments in a manner that will make it easier for us to complete our initial business combination that our stockholders may not support.
+
+ In order to effectuate an initial business combination, blank check companies have, in the recent past, amended various provisions of their charters and modified governing instruments, including their warrant agreements. For example, blank check companies have amended the definition of business combination, increased redemption thresholds and extended the time to consummate an initial business combination and, with respect to their warrants, amended their warrant agreements to require the warrants to be exchanged for cash and/or other securities. Amending our amended and restated certificate of incorporation with respect to any provisions related to pre-initial business combination activity (including the requirement to deposit proceeds of this offering and the private placement of units into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein) will require the approval of holders of 50% of our common stock entitled to vote thereon. In addition, our amended and restated certificate of incorporation requires us to provide our public stockholders with the opportunity to redeem their public shares for cash if we propose an amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain amendments to our charter prior thereto or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering or during any Extension Period or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity.
+
+ To the extent any such amendments would be deemed to fundamentally change the nature of any securities offered through this registration statement, we would register, or seek an exemption from registration for, the affected securities. We cannot assure you that we will not seek to amend our charter or governing instruments or extend the time to consummate an initial business combination in order to effectuate our initial business combination.
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+ The provisions of our amended and restated certificate of incorporation that relate to our pre-business combination activity (and corresponding provisions of the agreement governing the release of funds from our trust account), including an amendment to permit us to withdraw funds from the trust account such that the per share amount investors will receive upon any redemption or liquidation is substantially reduced or eliminated, may be amended with the approval of holders of at least 50% of our common stock, which is a lower amendment threshold than that of some other blank check companies. It may be easier for us, therefore, to amend our amended and restated certificate of incorporation and the trust agreement to facilitate the completion of an initial business combination that some of our stockholders may not support.
+
+ Our amended and restated certificate of incorporation will provide that any of its provisions related to pre-initial business combination activity (including the requirement to deposit proceeds of this offering and the sale of the placement warrants into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein and including to permit us to withdraw funds from the trust account such that the per share amount investors will receive upon any redemption or liquidation is substantially reduced or eliminated) may be amended if approved by holders of at least 50% of our common stock entitled to vote thereon. We may not issue additional securities that can vote on amendments to our amended and restated certificate of incorporation. Our initial stockholders, who will collectively beneficially own 20% of our common stock upon the closing of this offering (assuming they do not purchase any units in this offering and excluding the representative s shares), will participate in any vote to amend our amended and restated certificate of incorporation and/or trust agreement and will have the discretion to vote in any manner they choose. As a result, we may be able to amend the provisions of our amended and restated certificate of incorporation which govern our pre-initial business combination behavior more easily than some other blank check companies, and this may increase our ability to complete an initial business combination with which you do not agree. Our stockholders may pursue remedies against us for any breach of our amended and restated certificate of incorporation.
+
+ Our sponsor, officers and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain amendments to our charter prior thereto or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering or during any Extension Period or (ii) with respect to any other provision relating to stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, divided by the number of then outstanding public shares. These agreements are contained in a letter agreement that we have entered into with our sponsor, officers and directors and our director nominees. Our stockholders are not parties to, or third-party beneficiaries of, these agreements and, as a result, will not have the ability to pursue remedies against our sponsor, officers or directors for any breach of these agreements. As a result, in the event of a breach, our stockholders would need to pursue a stockholder derivative action, subject to applicable law.
+
+ As the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets. This could increase the cost of our initial business combination and could even result in our inability to find a target or to consummate an initial business combination.
+
+ In recent years and especially since the fourth quarter of 2020, the number of special purpose acquisition companies that have been formed has increased substantially. Many potential targets for special purpose acquisition companies have already entered into an initial business combination, and there are still many special purpose acquisition companies seeking targets for their initial business combination, as well as many such companies currently in registration. As a result, at times, fewer attractive targets may be available, and it may require more time, more effort and more resources to identify a suitable target and to consummate an initial business combination.
+
+ In addition, because there are more special purpose acquisition companies seeking to enter into an initial business combination with available targets, the competition for available targets with attractive fundamentals or business models may increase, which could cause target companies to demand improved financial terms. Attractive deals could also become scarcer for other reasons, such as economic or industry sector downturns, geopolitical tensions, or increases in the cost of additional capital needed to close business combinations or operate targets post-business combination. This could increase the cost of, delay or otherwise complicate or frustrate our ability to find and consummate an initial business combination, and may result in our inability to consummate an initial business combination on terms favorable to our investors altogether.
+
+ 
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+ Changes in the market for directors and officers liability insurance could make it more difficult and more expensive for us to negotiate and complete an initial business combination.
+
+ In recent months, the market for directors and officers liability insurance for special purpose acquisition companies has changed in ways adverse to us and our management team. The premiums charged for such policies have generally increased and the terms of such policies have generally become less favorable. These trends may continue into the future.
+
+ The increased cost and decreased availability of directors and officers liability insurance could make it more difficult and more expensive for us to negotiate and complete an initial business combination. In order to obtain directors and officers liability insurance or modify its coverage as a result of becoming a public company, the post-business combination entity might need to incur greater expense and/or accept less favorable terms. Furthermore, any failure to obtain adequate directors and officers liability insurance could have an adverse impact on the post-business combination s ability to attract and retain qualified officers and directors.
+
+ In addition, after completion of any initial business combination, our directors and officers could be subject to potential liability from claims arising from conduct alleged to have occurred prior to such initial business combination. As a result, in order to protect our directors and officers, the post-business combination entity likely will need to purchase additional insurance with respect to any such claims ( run-off insurance ). The need for run-off insurance would be an added expense for the post-business combination entity and could interfere with or frustrate our ability to consummate an initial business combination on terms favorable to our investors.
+
+ We may be unable to obtain additional financing to complete our initial business combination or to fund the operations and growth of a target business, which could compel us to restructure or abandon a particular business combination.
+
+ We have not selected any specific business combination target, but intend to target businesses larger than we could acquire with the net proceeds of this offering and the sale of the placement warrants. As a result, we may be required to seek additional financing to complete such proposed initial business combination. We cannot assure you that such financing will be available on acceptable terms, if at all. To the extent that additional financing proves to be unavailable when needed to complete our initial business combination, we would be compelled to either restructure the transaction or abandon that particular business combination and seek an alternative target business candidate. Further, the amount of additional financing we may be required to obtain could increase as a result of future growth capital needs for any particular transaction, the depletion of the available net proceeds in search of a target business, the obligation to repurchase for cash a significant number of shares from stockholders who elect redemption in connection with our initial business combination and/or the terms of negotiated transactions to purchase shares in connection with our initial business combination. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share plus any pro rata interest earned on the funds held in the trust account and not previously released to us to pay our taxes on the liquidation of our trust account and our warrants will expire worthless. In addition, even if we do not need additional financing to complete our initial business combination, we may require such financing to fund the operations or growth of the target business. The failure to secure additional financing could have a material adverse effect on the continued development or growth of the target business. None of our officers, directors or stockholders is required to provide any financing to us in connection with or after our initial business combination. If we are unable to complete our initial business combination, our public stockholders may only receive approximately $10.20 per share on the liquidation of our trust account, or less in certain circumstances, and our warrants will expire worthless. Furthermore, as described in the risk factor entitled If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by stockholders may be less than $10.20 per share, under certain circumstances our public stockholders may receive less than $10.20 per share upon the liquidation of the trust account.
+
+ Our initial stockholders may exert a substantial influence on actions requiring a stockholder vote, potentially in a manner that you do not support.
+
+ Upon the closing of this offering, our initial stockholders will own shares representing 20% of our issued and outstanding shares of common stock (assuming they do not purchase any units in this offering and excluding the representative s shares). Accordingly, they may exert a substantial influence on actions requiring a stockholder vote, potentially in a manner that you do not support, including amendments to our amended and restated certificate of incorporation and approval of major corporate transactions. If our initial stockholders purchase any units in this offering or if our initial stockholders purchase any additional shares of common stock in the aftermarket or in privately negotiated 
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+ transactions, this would increase their control. Factors that would be considered in making such additional purchases would include consideration of the current trading price of our common stock. In addition, our board of directors, were elected by our initial stockholders. We may not hold an annual meeting of stockholders to elect new directors prior to the completion of our initial business combination, in which case all of the current directors will continue in office until at least the completion of the initial business combination. Accordingly, our initial stockholders will exert control of the board of directors for the near term, including potentially until the completion of our initial business combination.
+
+ Our board of directors is and will be divided into three classes, each of which will generally serve for a term of three years with only one class of directors being elected in each year. It is unlikely that there will be an annual meeting of stockholders to elect new directors prior to the consummation of a business combination, in which case all of the current directors will continue in office until at least the consummation of the business combination. Accordingly, you may not be able to exercise your voting rights under corporate law for up to 12 months. If there is an annual meeting, as a consequence of our staggered board of directors, only a minority of the board of directors will be considered for election and our initial stockholders, because of their ownership position, will have considerable influence regarding the outcome. Accordingly, our initial stockholders will continue to exert control at least until the consummation of a business combination.
+
+ Because we must furnish our stockholders with target business financial statements, we may lose the ability to complete an otherwise advantageous initial business combination with some prospective target businesses.
+
+ The federal proxy rules require that a proxy statement with respect to a vote on an initial business combination meeting certain financial significance tests include historical and/or pro forma financial statement disclosure in periodic reports. We will include the same financial statement disclosure in connection with our tender offer documents, whether or not they are required under the tender offer rules. These financial statements may be required to be prepared in accordance with, or be reconciled to, accounting principles generally accepted in the United States of America, or GAAP, or international financial reporting standards as issued by the International Accounting Standards Board, or IFRS, depending on the circumstances and the historical financial statements may be required to be audited in accordance with the standards of the Public Company Accounting Oversight Board (United States), or PCAOB. These financial statement requirements may limit the pool of potential target businesses we may acquire because some targets may be unable to provide such financial statements in time for us to disclose such statements in accordance with federal proxy rules and complete our initial business combination within the prescribed time frame.
+
+ Compliance obligations under the Sarbanes-Oxley Act may make it more difficult for us to effectuate our initial business combination, require substantial financial and management resources, and increase the time and costs of completing an initial business combination.
+
+ Section 404 of the Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls beginning with our Annual Report on Form 10-K for the year ending October 31, 2023. Only in the event we are deemed to be a large accelerated filer or an accelerated filer, and no longer qualify as an emerging growth company, will we be required to comply with the independent registered public accounting firm attestation requirement on our internal control over financial reporting. Further, for as long as we remain an emerging growth company, we will not be required to comply with the independent registered public accounting firm attestation requirement on our internal control over financial reporting. The fact that we are a blank check company makes compliance with the requirements of the Sarbanes-Oxley Act particularly burdensome on us as compared to other public companies because a target company with which we seek to complete our initial business combination may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy of its internal controls. The development of the internal control of any such entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such business combination.
+
+ If we effect our initial business combination with a company with operations or opportunities outside of the United States, we would be subject to a variety of additional risks that may negatively impact our operations.
+
+ If we effect our initial business combination with a company with operations or opportunities outside of the United States, we would be subject to any special considerations or risks associated with companies operating in an international setting, including any of the following:
+
+ higher costs and difficulties inherent in managing cross-border business operations and complying with different commercial and legal requirements of overseas markets;
+
+ 
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+ rules and regulations regarding currency redemption;
+
+ complex corporate withholding taxes on individuals;
+
+ laws governing the manner in which future business combinations may be effected;
+
+ tariffs and trade barriers;
+
+ regulations related to customs and import/export matters;
+
+ longer payment cycles and challenges in collecting accounts receivable;
+
+ tax issues, including but not limited to tax law changes and variations in tax laws as compared to the United States;
+
+ currency fluctuations and exchange controls;
+
+ rates of inflation;
+
+ cultural and language differences;
+
+ employment regulations;
+
+ crime, strikes, riots, civil disturbances, terrorist attacks, natural disasters and wars;
+
+ deterioration of political relations with the United States; and
+
+ government appropriations of assets.
+
+ We may not be able to adequately address these additional risks. If we were unable to do so, our operations might suffer, which may adversely impact our results of operations and financial condition.
+
+ If our management team following our initial business combination is unfamiliar with United States securities laws, they may have to expend time and resources becoming familiar with such laws, which could lead to various regulatory issues.
+
+ Following our initial business combination, our founding team may resign from their positions as officers or directors of the company and the management of the business combination partner will may assume the roles of executive officers and directors of our company. Such officers and directors may not be familiar with United States securities laws. If our new management following our initial business combination is unfamiliar with United States securities laws, they may have to expend time and resources becoming familiar with such laws. This could be expensive and time-consuming and could lead to various regulatory issues which may adversely affect our operations.
+
+ After our initial business combination, substantially all of our assets may be located in a foreign country and substantially all of our revenue may be derived from our operations in such country. Accordingly, our results of operations and prospects will be subject, to a significant extent, to the economic, political and social conditions and government policies, developments and conditions in the country in which we operate.
+
+ As we may acquire a business located outside of the United States as part of our initial business combination, the economic, political and social conditions, as well as government policies, of the country in which our operations would be located following our initial business combination could affect our business. Economic growth could be uneven, both geographically and among various sectors of the economy and such growth may not be sustained in the future. If in the future such country s economy experiences a downturn or grows at a slower rate than expected, there may be less demand for spending in certain industries. A decrease in demand for spending in certain industries could materially and adversely affect our ability to find an attractive target business with which to consummate our initial business combination and if we effect our initial business combination, the ability of that target business to become profitable.
+
+ Exchange rate fluctuations and currency policies may cause our target business s ability to succeed in the international markets to be diminished.
+
+ In the event we acquire a non-U.S. business as part of our initial business combination, all revenues and income would likely be received in a foreign currency, and the dollar equivalent of our net assets and distributions, if any, 
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+ could be adversely affected by reductions in the value of the local currency. The value of the currencies in our target regions fluctuate and are affected by, among other things, changes in political and economic conditions. Any change in the relative value of such currency against our reporting currency may affect the attractiveness of any target business or, following consummation of our initial business combination, our financial condition and results of operations. Additionally, if a currency appreciates in value against the dollar prior to the consummation of our initial business combination, the cost of a target business as measured in dollars will increase, which may make it less likely that we are able to consummate such transaction.
+
+ We may reincorporate in another jurisdiction in connection with our initial business combination, and the laws of such jurisdiction may govern some or all of our future material agreements and we may not be able to enforce our legal rights.
+
+ In connection with our initial business combination, we may relocate the home jurisdiction of our business from the U.S. to another jurisdiction. If we determine to do this, the laws of such jurisdiction may govern some or all of our future material agreements. The system of laws and the enforcement of existing laws in such jurisdiction may not be as certain in implementation and interpretation as in the United States. The inability to enforce or obtain a remedy under any of our future agreements could result in a significant loss of business, business opportunities or capital.
+
+ There may be tax consequences to our business combinations that may adversely affect us.
+
+ While we expect to undertake any merger or acquisition so as to minimize taxes both to the acquired business and/or asset and us, such business combination might not meet the statutory requirements of a tax-free reorganization, or the parties might not obtain the intended tax-free treatment upon a transfer of shares or assets. A reorganization that does not qualify as tax-free could result in the imposition of substantial taxes on holders of our securities.
+
+ Risks Relating to our Sponsor and Management Team
+
+ Our ability to successfully effect our initial business combination and to be successful thereafter will be totally dependent upon the efforts of our key personnel, some of whom may join us following our initial business combination. The loss of key personnel could negatively impact the operations and profitability of our post-combination business.
+
+ Our ability to successfully effect our initial business combination is dependent upon the efforts of our key personnel. The role of our key personnel in the target business, however, cannot presently be ascertained. Although some of our key personnel may remain with the target business in senior management or advisory positions following our initial business combination, it is likely that some or all of the management of the target business will remain in place. While we intend to closely scrutinize any individuals we employ after our initial business combination, we cannot assure you that our assessment of these individuals will prove to be correct. These individuals may be unfamiliar with the requirements of operating a company regulated by the SEC, which could cause us to have to expend time and resources helping them become familiar with such requirements. In addition, the officers and directors of an initial business combination candidate may resign upon completion of our initial business combination. The departure of an initial business combination target s key personnel could negatively impact the operations and profitability of our post-combination business. The role of an initial business combination candidate s key personnel upon the completion of our initial business combination cannot be ascertained at this time. Although we contemplate that certain members of an initial business combination candidate s management team will remain associated with the initial business combination candidate following our initial business combination, it is possible that members of the management of an initial business combination candidate will not wish to remain in place. The loss of key personnel could negatively impact the operations and profitability of our post-combination business.
+
+ Members of our management team may be, or may in the future be, involved in governmental investigations and civil litigation relating to the business affairs of companies with which they are, were, or may in the future be, affiliated. This may negatively affect our ability to consummate an initial business combination.
+
+ During the course of their careers, members of our management team may have been employed by, served as board members of, and assisted many companies going through turnarounds, as well as companies in special situations, financial distress, restructuring and companies suffering from mismanagement, in attempts to rectify such problems. As a result of their involvement with companies in these situations, they may be, or may in the future be, 
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+ involved in governmental investigations and civil litigation relating to the business affairs of such companies. Any such investigations or litigations may divert our management team s attention and resources away from searching for an initial business combination, may be detrimental to our reputation, and thus may negatively affect our ability to complete an initial business combination.
+
+ We are dependent upon our executive officers and directors and their departure could adversely affect our ability to operate.
+
+ Our operations are dependent upon a relatively small group of individuals and, in particular, our executive officers and directors. We believe that our success depends on the continued service of our executive officers and directors, at least until we have completed our initial business combination. We do not have an employment agreement with, or key-man insurance on the life of, any of our directors or executive officers. The unexpected loss of the services of one or more of our directors or executive officers could have a detrimental effect on us.
+
+ Our key personnel may negotiate employment or consulting agreements with a target business in connection with a particular business combination. These agreements may provide for them to receive compensation following our initial business combination and as a result, may cause them to have conflicts of interest in determining whether a particular business combination is the most advantageous.
+
+ Our key personnel may be able to remain with the company after the completion of our initial business combination only if they are able to negotiate employment or consulting agreements in connection with the initial business combination. Such negotiations would take place simultaneously with the negotiation of the initial business combination and could provide for such individuals to receive compensation in the form of cash payments and/or our securities for services they would render to us after the completion of the initial business combination. The personal and financial interests of such individuals may influence their motivation in identifying and selecting a target business. However, we believe the ability of such individuals to remain with us after the completion of our initial business combination will not be the determining factor in our decision as to whether or not we will proceed with any potential business combination. There is no certainty, however, that any of our key personnel will remain with us after the completion of our initial business combination. We cannot assure you that any of our key personnel will remain in senior management or advisory positions with us. The determination as to whether any of our key personnel will remain with us will be made at the time of the consummation of our initial business combination.
+
+ Our officers and directors will allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial business combination.
+
+ Our officers and directors are not required to, and will not, commit their full time to our affairs, which may result in a conflict of interest in allocating their time between our operations and our search for an initial business combination and their other businesses. We do not intend to have any full-time employees prior to the completion of our initial business combination. Each of our officers is engaged in other business endeavors for which he may be entitled to substantial compensation and our officers are not obligated to contribute any specific number of hours per week to our affairs. Our independent directors may also serve as officers or board members for other entities. If our officers and directors other business affairs require them to devote substantial amounts of time to such affairs in excess of their current commitment levels, it could limit their ability to devote time to our affairs which may have a negative impact on our ability to complete our initial business combination. For a complete discussion of our officers and directors other business affairs, please see the section of this prospectus entitled Management Directors and Officers. 
+
+ Certain of our officers and directors are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in allocating their time and determining to which entity a particular business opportunity should be presented.
+
+ Following the completion of this offering and until we consummate our initial business combination, we intend to engage in the business of identifying and combining with one or more businesses. Our sponsor and officers and directors are, and may in the future become, affiliated with entities (such as operating companies or investment vehicles) that are engaged in a similar business and our officers and directors may become officers or directors of another 
+
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+ special purpose acquisition company with a class of securities intended to be registered under the Exchange Act, even prior to us entering into a definitive agreement for our initial business combination. Our officers and directors also may become aware of business opportunities which may be appropriate for presentation to us and the other entities to which they owe certain fiduciary or contractual duties.
+
+ Accordingly, they may have conflicts of interest in determining to which entity a particular business opportunity should be presented. These conflicts may not be resolved in our favor and a potential target business may be presented to another entity prior to its presentation to us. Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation.
+
+ For a complete discussion of our officers and directors business affiliations and the potential conflicts of interest that you should be aware of, please see the sections of this prospectus entitled Management Directors and Officers, Management Conflicts of Interest and Certain Relationships and Related Party Transactions. 
+
+ Our officers, directors, security holders and their respective affiliates may have competitive pecuniary interests that conflict with our interests.
+
+ We have not adopted a policy that expressly prohibits our directors, officers, security holders or affiliates from having a direct or indirect pecuniary or financial interest in any investment to be acquired or disposed of by us or in any transaction to which we are a party or have an interest. In fact, we may enter into an initial business combination with a target business that is affiliated with our sponsor, our directors or officers, although we do not intend to do so. We do not have a policy that expressly prohibits any such persons from engaging for their own account in business activities of the types conducted by us. Accordingly, such persons or entities may have a conflict between their interests and ours.
+
+ The personal and financial interests of our executive officers and directors may influence their motivation in timely identifying and selecting a target business and completing a business combination. Consequently, our executive officers and directors discretion in identifying and selecting a suitable target business may result in a conflict of interest when determining whether the terms, conditions and timing of a particular business combination are appropriate and in our stockholders best interest. If this were the case, it would be a breach of their fiduciary duties to us as a matter of Delaware law and we or our stockholders might have a claim against such individuals for infringing on our stockholders rights. See the section titled Description of Securities Certain Differences in Corporate Law Stockholders Suits for further information on the ability to bring such claims. However, we might not ultimately be successful in any claim we may make against them for such reason
+
+ The representative may have a conflict of interest if they render services to us in connection with our initial business combination.
+
+ We may elect to engage EF Hutton, division of Benchmark Investments, LLC formerly known as Kingswood Capital Markets, division of Benchmark Investments, LLC (who is the representative of the underwriters of this offering) to assist us in connection with our initial business combination. The representative will not be paid its deferred commissions if we do not consummate an initial business combination. The representative shares held by the representative and/or its designees will also be worthless if we do not consummate an initial business combination. Therefore, if the representative provides services to us in connection with our initial business combination, these financial interests may result in the representative having a conflict of interest when providing such services to us.
+
+ We may engage in an initial business combination with one or more target businesses that have relationships with entities that may be affiliated with our sponsor, officers, directors or existing holders which may raise potential conflicts of interest.
+
+ In light of the involvement of our sponsor, officers and directors with other entities, we may decide to acquire one or more businesses affiliated with our sponsor, officers or directors. Our directors and officers also serve as officers and board members for other entities, including, without limitation, those described under the section of this prospectus entitled Management Conflicts of Interest. Such entities may compete with us for business combination opportunities. Our sponsor, officers and directors are not currently aware of any specific opportunities 
+
+ 
+
+ 51
+
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+
+ 
+ for us to complete our initial business combination with any entities with which they are affiliated, and there have been no preliminary discussions concerning an initial business combination with any such entity or entities. Although we will not be specifically focusing on, or targeting, any transaction with any affiliated entities, we would pursue such a transaction if we determined that such affiliated entity met our criteria for an initial business combination as set forth in the section of this prospectus entitled Proposed Business Selection of a Target Business and Structuring of our Initial Business Combination and such transaction was approved by a majority of our disinterested directors. Despite our agreement to obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions, regarding the fairness to our stockholders from a financial point of view of an initial business combination with one or more businesses affiliated with our sponsor, officers, directors or existing holders, potential conflicts of interest still may exist and, as a result, the terms of the initial business combination may not be as advantageous to our public stockholders as they would be absent any conflicts of interest.
+
+ Since our sponsor, officers and directors will lose their entire investment in us if our initial business combination is not completed, a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination.
+
+ On September 23, 2021, our sponsor purchased 2,875,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.009 per share. On March 25, 2022, our sponsor forfeited an aggregate of 718,750 founder shares to our capital for no additional consideration, resulting in our sponsor holding an aggregate of 2,156,250 founder shares, or an effective purchase price of approximately $0.01 per share. The number of founder shares issued was determined based on the expectation that such founder shares would represent 20% of the outstanding shares after this offering (excluding the placement warrants and underlying securities, and the representative s shares). The founder shares will be worthless if we do not complete an initial business combination. Our sponsor has agreed to purchase an aggregate of 4,262,500 placement warrants at a price of $1.00 per warrant for an aggregate purchase price of $4,262,500 (provided that if the over-allotment option is exercised in full, the amount of placement warrants sold will be 4,600,000 for an aggregate purchase price of $4,600,000). Each placement warrant is exercisable to purchase one whole share of common stock at $11.50 per share. The placement warrants will be worthless if we do not complete an initial business combination. Holders of founder shares have agreed (A) to vote any shares owned by them in favor of any proposed initial business combination and (B) not to redeem any founder shares held by them in connection with a stockholder vote to approve a proposed initial business combination. In addition, we may obtain loans from our sponsor, affiliates of our sponsor or an officer or director. The personal and financial interests of our officers and directors may influence their motivation in identifying and selecting a target business combination, completing an initial business combination and influencing the operation of the business following the initial business combination.
+
+ Since our sponsor, executive officers and directors will not be eligible to be reimbursed for their out-of-pocket expenses if our business combination is not completed, a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination.
+
+ Our sponsor, executive officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business combinations. There is no cap or ceiling on the reimbursement of out-of-pocket expenses incurred in connection with activities on our behalf; provided, however, that to the extent such expenses exceed the available proceeds not deposited in the trust account, such expenses would not be reimbursed by us unless we consummate an initial business combination. These financial interests of our sponsor, executive officers and directors may influence their motivation in identifying and selecting a target business combination and completing an initial business combination.
+
+ Risks Relating to our Securities
+
+ The securities in which we invest the funds held in the trust account could bear a negative rate of interest, which could reduce the value of the assets held in trust such that the per-share redemption amount received by public stockholders may be less than $10.20 per share.
+
+ The proceeds held in the trust account will be invested only in U.S. government treasury obligations with a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act, which invest only in direct U.S. government treasury obligations. While short-term U.S. government treasury obligations currently yield a positive rate of interest, they have briefly yielded negative interest rates in 
+
+ 
+
+ 52
+
+ Table of Contents
+
+ 
+ recent years. Central banks in Europe and Japan pursued interest rates below zero in recent years, and the Open Market Committee of the Federal Reserve has not ruled out the possibility that it may in the future adopt similar policies in the United States. In the event that we are unable to complete our initial business combination or make certain amendments to our amended and restated certificate of incorporation, our public stockholders are entitled to receive their pro-rata share of the proceeds held in the trust account, plus any interest income, net of taxes paid or payable (less, in the case we are unable to complete our initial business combination, $100,000 of interest). Negative interest rates could reduce the value of the assets held in trust such that the per-share redemption amount received by public stockholders may be less than $10.20 per share.
+
+ Nasdaq may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities and subject us to additional trading restrictions.
+
+ We have applied to have our units listed on Nasdaq. We expect that our units will be listed on Nasdaq on or promptly after the date of this prospectus. Following the date the shares of our common stock and warrants are eligible to trade separately, we anticipate that the shares of our common stock and warrants will be separately listed on Nasdaq. We cannot guarantee that our securities will be approved for listing on Nasdaq. Although after giving effect to this offering we expect to meet, on a pro forma basis, the minimum initial listing standards set forth in the Nasdaq listing standards, we cannot assure you that our securities will be, or will continue to be, listed on Nasdaq in the future or prior to our initial business combination. In order to continue listing our securities on Nasdaq prior to our initial business combination, we must maintain certain financial, distribution and stock price levels. Additionally, in connection with our initial business combination, we will be required to demonstrate compliance with Nasdaq s initial listing requirements, which are more rigorous than Nasdaq s continued listing requirements, in order to continue to maintain the listing of our securities on Nasdaq. We cannot assure you that we will be able to meet those initial listing requirements at that time.
+
+ If Nasdaq delists our securities from trading on its exchange and we are not able to list our securities on another national securities exchange, we expect our securities could be quoted on an over-the-counter market. If this were to occur, we could face significant material adverse consequences, including:
+
+ a limited availability of market quotations for our securities;
+
+ reduced liquidity for our securities;
+
+ a determination that our securities are a penny stock which will require brokers trading in our securities to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities;
+
+ a limited amount of news and analyst coverage; and
+
+ a decreased ability to issue additional securities or obtain additional financing in the future.
+
+ The National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as covered securities. Because we expect that our units and eventually our common stock and warrants will be listed on Nasdaq, our units, common stock, and warrants will be covered securities. Although the states are preempted from regulating the sale of our securities, the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. Further, if we were no longer listed on Nasdaq, our securities would not be covered securities and we would be subject to regulation in each state in which we offer our securities, including in connection with our initial business combination.
+
+ If we seek stockholder approval of our initial business combination and we do not conduct redemptions pursuant to the tender offer rules, and if you or a group of stockholders are deemed to hold in excess of 15% of our common stock, you will lose the ability to redeem all such shares in excess of 15% of our common stock.
+
+ If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or 
+
+ 
+
+ 53
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+
+ 
+ any other person with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect to more than an aggregate of 15% of the shares sold in this offering without our prior consent, which we refer to as the Excess Shares. However, we would not be restricting our stockholders ability to vote all of their shares (including Excess Shares) for or against our initial business combination. Your inability to redeem the Excess Shares will reduce your influence over our ability to complete our initial business combination and you could suffer a material loss on your investment in us if you sell Excess Shares in open market transactions. Additionally, you will not receive redemption distributions with respect to the Excess Shares if we complete our initial business combination. And as a result, you will continue to hold that number of shares exceeding 15% and, in order to dispose of such shares, would be required to sell your shares in open market transactions, potentially at a loss.
+
+ We are not registering the shares of common stock issuable upon exercise of the warrants under the Securities Act or any state securities laws at this time, and such registration may not be in place when an investor desires to exercise warrants, thus precluding such investor from being able to exercise its warrants except on a cashless basis. If the issuance of the shares upon exercise of warrants is not registered, qualified or exempt from registration or qualification, the holder of such warrant will not be entitled to exercise such warrant and such warrant may have no value and expire worthless.
+
+ We are not registering the shares of common stock issuable upon exercise of the warrants under the Securities Act or any state securities laws at this time. However, under the terms of the warrant agreement, we have agreed that as soon as practicable after the closing of our initial business combination, we will use our best efforts to file with the SEC a registration statement for the registration under the Securities Act of the issuance of the shares of common stock issuable upon exercise of the warrants and thereafter will use our best efforts to cause the same to become effective within 90 days following our initial business combination and to maintain a current prospectus relating to the common stock issuable upon exercise of the warrants, until the expiration of the warrants in accordance with the provisions of the warrant agreement. We cannot assure you that we will be able to do so if, for example, any facts or events arise which represent a fundamental change in the information set forth in the registration statement or prospectus, the financial statements contained or incorporated by reference therein are not current, complete or correct or the SEC issues a stop order. If the shares of common stock issuable upon exercise of the warrants are not registered under the Securities Act, we will be required to permit holders to exercise their warrants on a cashless basis. However, no warrant will be exercisable for cash or on a cashless basis, and we will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption from registration is available. Notwithstanding the foregoing, if a registration statement covering the issuance of the common stock issuable upon exercise of the warrants is not effective within a specified period following the consummation of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to the exemption provided by Section 3(a)(9) of the Securities Act, provided that such exemption is available. If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a cashless basis. We will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. In no event will we be required to net cash settle any warrant, or issue securities or other compensation in exchange for the warrants in the event that we are unable to register or qualify the shares underlying the warrants under applicable state securities laws and there is no exemption available. If the issuance of the shares upon exercise of the warrants is not so registered or qualified or exempt from registration or qualification, the holder of such warrant will not be entitled to exercise such warrant and such warrant may have no value and expire worthless. In such event, holders who acquired their warrants as part of a purchase of units will have paid the full unit purchase price solely for the shares of common stock included in the units. If and when the warrants become redeemable by us, we may not exercise our redemption right if the issuance of shares of common stock upon exercise of the warrants is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect such registration or qualification. We will use our best efforts to register or qualify such shares of common stock under the blue sky laws of the state of residence in those states in which the warrants were offered by us in this offering. However, there may be instances in which holders of our public warrants may be unable to exercise such public warrants but holders of our placement warrants may be able to exercise such placement warrants.
+
+ 
+
+ 54
+
+ Table of Contents
+
+ 
+ If you exercise your public warrants on a cashless basis, you will receive fewer shares of common stock from such exercise than if you were to exercise such warrants for cash.
+
+ There are circumstances in which the exercise of the public warrants may be required or permitted to be made on a cashless basis. First, if a registration statement covering the issuance of the shares of common stock issuable upon exercise of the warrants is not effective by the 90th day after the closing of our initial business combination, warrant holders may, until such time as there is an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption. Second, if a registration statement covering the common stock issuable upon exercise of the warrants is not effective within a specified period following the consummation of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to the exemption provided by Section 3(a)(9) of the Securities Act, provided that such exemption is available; if that exemption, or another exemption, is not available, holders will not be able to exercise their warrants on a cashless basis. Third, if we call the public warrants for redemption, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In the event of an exercise on a cashless basis, a holder would pay the warrant exercise price by surrendering the warrants for that number of shares of common stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied by the excess of the fair market value (as defined in the next sentence) over the exercise price of the warrants by (y) the fair market value. The fair market value for this purpose shall mean the average reported last sale price of the common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of exercise is received by the warrant agent or on which the notice of redemption is sent to the holders of warrants, as applicable. As a result, you would receive fewer shares of common stock from such exercise than if you were to exercise such warrants for cash.
+
+ We may issue additional common stock or preferred stock to complete our initial business combination or under an employee incentive plan after completion of our initial business combination. Any such issuances would dilute the interest of our stockholders and likely present other risks.
+
+ Our amended and restated certificate of incorporation will authorize the issuance of up to 50,000,000 shares of common stock, par value $0.0001 per share, and 1,000,000 shares of preferred stock, par value $0.0001 per share. Immediately after this offering and the sale of the placement warrants and the issuance of 75,000 shares to the representative of the underwriters, there will be 28,787,500 (assuming that the underwriters have not exercised their over-allotment option) authorized but unissued shares of common stock available for issuance, which amount takes into account the shares of common stock reserved for issuance upon exercise of outstanding warrants. Immediately after the consummation of this offering, there will be no shares of preferred stock issued and outstanding.
+
+ We may issue a substantial number of additional shares of common or preferred stock to complete our initial business combination or under an employee incentive plan after completion of our initial business combination (although our amended and restated certificate of incorporation will provide that we may not issue securities that can vote with common stockholders on matters related to our pre-initial business combination activity). However, our amended and restated certificate of incorporation will provide, among other things, that prior to our initial business combination, we may not issue additional shares of capital stock that would entitle the holders thereof to (i) receive funds from the trust account or (ii) vote on any initial business combination. These provisions of our amended and restated certificate of incorporation, like all provisions of our amended and restated certificate of incorporation, may be amended with the approval of our stockholders. However, our executive officers, directors and director nominees have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain amendments to our charter prior thereto or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering or during any Extension Period or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable), divided by the number of then outstanding public shares.
+
+ The issuance of additional shares of common or preferred stock:
+
+ may significantly dilute the equity interest of investors in this offering;
+
+ may subordinate the rights of holders of our common stock if preferred stock is issued with rights senior to those afforded our common stock;
+
+ 
+
+ 55
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+ Table of Contents
+
+ 
+ could cause a change of control if a substantial number of shares of our common stock are issued, which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the resignation or removal of our present officers and directors;
+
+ may have the effect of delaying or preventing a change of control of us by diluting the stock ownership or voting rights of a person seeking to obtain control of us; and
+
+ may adversely affect prevailing market prices for our units, common stock and/or warrants.
+
+ Our initial stockholders paid a nominal price for the founders shares and, accordingly, you will experience immediate and substantial dilution from the purchase of our shares of common stock.
+
+ The difference between the public offering price per share (allocating all of the unit purchase price to the common stock and none to the warrants included in the unit) and the pro forma net tangible book value per share of our common stock after this offering constitutes the dilution to you and the other investors in this offering. Our sponsor acquired the founder shares at a nominal price, significantly contributing to this dilution. Upon the closing of this offering, and assuming no value is ascribed to the warrants included in the units, you and the other public stockholders will incur an immediate and substantial dilution of approximately $10.70 per share (or $10.77 per share, assuming the full exercise of the underwriters over-allotment option), the difference between the pro forma net tangible book value per share and the initial offering price of $10.00 per unit. The economic dilution to initial stockholders, however, is $0.70 per share (or $0.77 per share, assuming the full exercise of the underwriters over-allotment option) after taking into account redeemable temporary equity of $10.00 per share.
+
+ We may amend the terms of the warrants in a manner that may be adverse to holders of public warrants with the approval by the holders of at least a majority of the then outstanding warrants. As a result, the exercise price of your warrants could be increased, the exercise period could be shortened and the number of shares of our common stock purchasable upon exercise of a warrant could be decreased, all without your approval.
+
+ Our warrants will be issued in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. The warrant agreement provides that the terms of the warrants may be amended without the consent of any holder to cure any ambiguity or correct any mistake, including to conform the provisions of the warrant agreement to the description of the terms of the warrants and the warrant agreement set forth in this prospectus, or defective provision, but requires the approval by the holders of at least a majority of the then outstanding warrants to make any change that adversely affects the interests of the registered holders of warrants (which will include the private placement warrants and any public warrants acquired by our sponsor or its affiliates in this offering or thereafter in the open market). Accordingly, we may amend the terms of the public warrants in a manner adverse to a holder if holders of at least a majority of the then outstanding warrants approve of such amendment. Although our ability to amend the terms of the public warrants with the consent of at least a majority of the then outstanding warrants is unlimited, examples of such amendments could be amendments to, among other things, increase the exercise price of the warrants, convert the warrants into cash or stock, shorten the exercise period or decrease the number of shares of our common stock purchasable upon exercise of a warrant.
+
+ We may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.
+
+ We have the ability to redeem outstanding warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided that the reported last sale price of our common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, rights issuances, reorganizations, recapitalizations and the like) for any 20 trading days within a 30 trading-day period commencing once the warrants become exercisable and ending on the third trading day prior to the date on which we give proper notice of such redemption and provided certain other conditions are met. If and when the warrants become redeemable by us, we may not exercise our redemption right if the issuance of shares of common stock upon exercise of the warrants is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect such registration or qualification, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. We will use our best efforts to register or qualify such shares of common stock under the blue sky laws of the state of residence in those states in which the warrants were offered by us in this offering. Redemption of the outstanding 
+
+ 
+
+ 56
+
+ Table of Contents
+
+ 
+ warrants could force you (i) to exercise your warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (ii) to sell your warrants at the then-current market price when you might otherwise wish to hold your warrants or (iii) to accept the nominal redemption price which, at the time the outstanding warrants are called for redemption, is likely to be substantially less than the market value of your warrants.
+
+ Our warrants may have an adverse effect on the market price of our common stock and make it more difficult to effectuate our initial business combination.
+
+ We will be issuing warrants to purchase 7,500,000 shares of our common stock (or up to 8,625,000 shares of common stock if the underwriters over-allotment option is exercised in full) as part of the units offered by this prospectus and, simultaneously with the closing of this offering, we will be issuing placement warrants, in a private placement, consisting of an aggregate of 4,262,500 placement warrants (or 4,600,000 if the over-allotment option is exercised in full) exercisable for 4,262,500 shares of our common stock (or 4,600,000 shares of our common stock if the over-allotment option is exercised in full). In addition, if our sponsor makes any working capital loans, up to $1,500,000 of such loans may be converted into warrants, at a price of $1.00 per warrant at the option of the lender, upon consummation of our initial business combination. The warrants would be identical to the placement warrants. To the extent we issue shares of common stock to effectuate an initial business combination, the potential for the issuance of a substantial number of additional shares of common stock upon exercise of these warrants and loans could make us a less attractive business combination vehicle to a target business. Any such issuance will increase the number of issued and outstanding shares of our common stock and reduce the value of the shares of common stock issued to complete the initial business combination. Therefore, our warrants may make it more difficult to effectuate an initial business combination or increase the cost of acquiring the target business.
+
+ The private placement warrants will be identical to the warrants sold in this offering except that the private placement warrants (including the common stock shares issuable upon exercise of these warrants) may not, subject to certain limited exceptions, be transferred, assigned or sold by the holders until 30 days after the completion of our initial business combination, and (ii) will be entitled to registration rights.
+
+ A provision of our warrant agreement may make it more difficult for us to consummate an initial business combination.
+
+ If:
+
+ (i) we issue additional shares of common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at a Newly Issued Price of less than $9.20 per share;
+
+ (ii) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions); and
+
+ (iii) the Market Value is below $9.20 per share;
+
+ then the exercise price of the warrants will be adjusted to be equal to 115% of the greater of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to 180% of the greater of the Market Value and the Newly Issued Price. This may make it more difficult for us to consummate an initial business combination with a target business.
+
+ The determination of the offering price of our units, the size of this offering and the terms of the units is more arbitrary than the pricing of securities and size of an offering of an operating company in a particular industry. You may have less assurance, therefore, that the offering price of our units properly reflects the value of such units than you would have in a typical offering of an operating company.
+
+ Prior to this offering there has been no public market for any of our securities. The public offering price of the units and the terms of the warrants were negotiated between us and the underwriters. In determining the size of this offering, management held customary organizational meetings with the representative of the underwriters, both prior 
+
+ 
+
+ 57
+
+ Table of Contents
+
+ 
+ to our inception and thereafter, with respect to the state of capital markets, generally, and the amount the underwriters believed they reasonably could raise on our behalf. Factors considered in determining the size of this offering, prices and terms of the units, including the common stock and warrants underlying the units, include:
+
+ the history and prospects of companies whose principal business is the acquisition of other companies;
+
+ prior offerings of those companies;
+
+ our prospects for acquiring an operating business;
+
+ a review of debt to equity ratios in leveraged transactions;
+
+ our capital structure;
+
+ an assessment of our management and their experience in identifying operating companies;
+
+ general conditions of the securities markets at the time of this offering; and
+
+ other factors as were deemed relevant.
+
+ Although these factors were considered, the determination of our offering price, size and terms of the units is more arbitrary than the pricing of securities of an operating company in a particular industry since we have no historical operations or financial results.
+
+ An investment in this offering may involve adverse U.S. federal income tax consequences.
+
+ An investment in this offering may involve adverse U.S. federal income tax consequences. For instance:
+
+ Because there are no authorities that directly address instruments similar to the units we are issuing in this offering, the allocation an investor makes with respect to the purchase price of the unit among the share of common stock and one half of one warrant included in the units could be challenged by the Internal Revenue Service of the United States ( IRS ) or the courts.
+
+ If we make distributions on our common stock, such distributions generally will be treated as dividends for U.S. federal income tax purposes to the extent of our current or accumulated earnings and profits. The ability of a holder to seek redemption of their shares may be viewed as a position with respect to substantially similar or related property which diminishes your risk of loss and thereby affects your ability to satisfy the holding period requirements for the dividends received deduction or the preferential tax rate on qualified dividend income with respect to the time period prior to the approval of an initial business combination.
+
+ Any capital gain or loss you realize on a sale or other disposition of our common stock will generally be long-term capital gain or loss if your holding period for the common stock is more than one year. However, the redemption feature of the common stock could affect your ability to satisfy the holding period requirements for the long-term capital gain tax rate with respect to the time period prior to the approval of an initial business combination.
+
+ See the section titled Material U.S. Federal Tax Considerations for a
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+PROSPECTUS SUMMARY. 5
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+++ b/parsed_sections/prospectus_summary/2022/CIK0001898019_axios_prospectus_summary.txt
@@ -0,0 +1 @@
+S-1/A 1 tm2136004-4_s1a.htm S-1/A tm2136004-4_s1a - block - 25.7345117s TABLE OF CONTENTS As filed with the U.S. Securities and Exchange Commission on February 7, 2022. Registration No. 333-262352 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 AMENDMENT NO. 1 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 AXIOS SUSTAINABLE GROWTH ACQUISITION CORPORATION (Exact name of registrant as specified in its charter) Cayman Islands 6770 98-1640650 (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) AXIOS SUSTAINABLE GROWTH ACQUISITION CORPORATION Hidden Pines Farm, 14090, Hopewell Road Alpharetta, Georgia 30004 Telephone: (770) 813-6500 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Benedikt F rtig, Chief Executive Officer c/o AXIOS SUSTAINABLE GROWTH ACQUISITION CORPORATION Hidden Pines Farm, 14090, Hopewell Road Alpharetta, Georgia 30004 Telephone: (770) 813-6500 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Michael J. Schwartz, Esq. Kevin T. Hardy, Esq. Skadden, Arps, Slate, Meagher & Flom LLP One Manhattan West New York, New York 10001 Tel: (212) 735-3000 Ralph De Martino, Esq. Cavas Pavri, Esq. Schiff Hardin LLP 901 K. St. NW Washington, DC 20001 Tel: (202) 778-6400 Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended (the Securities Act ) check the following box: If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company, and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. TABLE OF CONTENTS TABLE OF CONTENTS We are responsible for the information contained in this prospectus. We have not authorized anyone to provide any information or to make any representations other than those contained in this prospectus. We and the underwriters take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the units offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date. Page SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001899211_bigbear_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001899211_bigbear_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001899211_bigbear_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001899225_bigbear_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001899225_bigbear_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001899225_bigbear_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001899261_promodel_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001899261_promodel_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001899261_promodel_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001900402_evergreen_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001900402_evergreen_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..90d701582cd3188f00b5ab36d0095db590b898ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001900402_evergreen_prospectus_summary.txt
@@ -0,0 +1,50 @@
+Summary
+Financial Data
+
+ 
+
+The
+following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included
+in this prospectus. Because we have not had any significant operations to date, only balance sheet data is presented.
+
+ 
+
+ 
+ 
+ November 30, 2021 
+
+ 
+ Balance Sheet Data: 
+ 
+
+ 
+ Working capital (deficiency) 
+ $(110,855)
+
+ 
+ Total assets 
+ $105,995 
+
+ 
+ Total liabilities 
+ $110,855 
+
+ 
+ Shareholder s deficit 
+ $(4,860)
+
+ 
+
+ 
+
+If
+no business combination is completed within the period to consummate the initial business combination, the proceeds then on deposit in
+the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our taxes as well as expenses relating to the administration of the trust account (less up to $100,000 of interest to pay our
+expenses, taxes and potentially dissolution expenses), will be used to fund the redemption of our public shares. Our sponsor, directors
+and each member of our management team have entered into a letter agreement with us, pursuant to which they have agreed to waive their
+rights to liquidating distributions from the trust account with respect to any founder shares held by them if we do not complete our
+initial business combination within such 18-month time period.
+
+ 
+
+ 35
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001900407_easler_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001900407_easler_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..50c036bde10dbd369f5e01a57e8b9da641744e94
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001900407_easler_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This Prospectus and any supplement to this Prospectus include forward-looking statements . To the extent that the information presented in this Prospectus discusses financial projections, information or expectations about our business plans, results of operations, products or markets, or otherwise makes statements about future events, such statements are forward-looking. Such forward-looking statements can be identified by the use of words such as intends , anticipates , believes , estimates , projects , forecasts , expects , plans and proposes . Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements. These include, among others, the cautionary statements in the Risk Factors section beginning on page 9 of this Prospectus and the Management s Discussion and Analysis of Financial Position and Results of Operations section beginning on page 34 of this Prospectus. This summary only highlights selected information contained in greater detail elsewhere in this Prospectus. This summary does not contain all of the information that you should consider before investing in our common stock. You should carefully read the entire Prospectus, including Risk Factors beginning on page 9, and the consolidated financial statements, before making an investment decision. Corporate Background and Business Overview ENERGIEINVESTING.COM INC. ( ENERGIEINVESTING.COM , the Company we or us ) is a development stage company. We were originally incorporated under the laws of the State of Florida on March 18, 2020 as NOWEA INC. On December 23, 2020, we filed a Certificate of Amendment whereby we changed our name to ENERGIEINVESTING.COM INC. We are in the business of oil and gas exploration in the United States with a secondary focus on acquiring alternative energy investments and rare earth exploration. During the period from March 18, 2020 (inception) through December 31, 2020 the Company acquired oil and gas properties consisting of 17 unproven wells across 7 mineral leases all within the state of Kentucky. The Company s working interest in the various leases ranges from 75% to 100%. The Company performs all maintenance, pumping and related activities on the wells. During the period from March 18, 2020 (inception) through December 31, 2020, the Company capitalized $20,000 of acquisition and development costs related to these leases, related to the asset retirement bond purchased in the State of Kentucky. Our fiscal year end is December 31. Our business offices are currently located at 2210 Front Street, Unit 206, Melbourne, Florida 32935. Our telephone number is (321)293-6003. We have two (2) executive officers, Joachim Haas, our President and Chief Executive Officer, and Achim Weber, our Chief Financial Officer. Our Director is Joachim Haas. We are a development stage company that has generated limited revenues and has had limited operations to date. As at December 31, 2021, the Company had recorded limited revenues, has a working capital deficit of $110,433, and has an accumulated deficit of $351,073. Through April 1, 2022, we have issued an aggregate of 45,992,100 shares of our common stock since our inception. We issued 100 shares of our common stock to the founding shareholder for services in connection with the formation and organization of the Company and sold the same founding shareholder 44,000,000 shares of common stock for total cash proceeds of $440,000. We issued 1,500,000 shares to the same founding shareholder for total cash proceeds $75,000. We issued a total of 492,000 shares of our common stock to forty-six (46) separate foreign shareholders and one (1) domestic shareholder through April 1, 2022, pursuant to a private placement of our common stock exempt from registration under Regulation S of the Securities Act of 1933, for total proceeds of approximately $24,600. Except for acquisition of the seventeen (17) leases described above, since our inception we have not made any significant purchase or sale of assets, nor have we been involved in any mergers, acquisitions or consolidations. The information in this prospectus is not complete and may be amended. The Registrant may not sell these securities until the Registration Statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION DATED ___________, 2022 PRELIMINARY PROSPECTUS ENERGIEINVESTING.COM INC. 492,000 SHARES OF COMMON STOCK OFFERING PRICE $0.50 PER SHARE This prospectus relates to the offering (the Offering ) of 492,000 shares of our common stock by our Selling Shareholders at a fixed offering price of $0.50 per share until our shares are quoted on the Over-the-Counter Bulletin Board, and thereafter at prevailing market prices or privately negotiated prices. We will pay all expenses incurred in this Offering (other than transfer taxes), and the Selling Shareholders will receive all of the net proceeds from this Offering. AN INVESTMENT IN OUR SECURITIES IS SPECULATIVE. INVESTORS SHOULD BE ABLE TO AFFORD THE LOSS OF THEIR ENTIRE INVESTMENT. YOU SHOULD CAREFULLY CONSIDER THE FACTORS DESCRIBED UNDER THE HEADING RISK FACTORS BEGINNING ON PAGE 12 BEFORE INVESTING IN OUR COMMON STOCK. Prior to this Offering, there has been no public market for our common stock and we have not applied for the listing or quotation of our common stock on any public market. We have arbitrarily determined the offering price of $0.50 per share in relation to this Offering. The offering price bears no relationship to our assets, book value, earnings or any other customary investment criteria. After the effective date of the registration statement, we intend to seek a market maker to file an application with the Financial Industry Regulatory Authority ( FINRA ) to have our common stock quoted on the OTC Bulletin Board. We may never be approved for trading on any exchange. We currently have no market maker who is willing to list quotations for our stock. There is no assurance that an active trading market for our shares will develop or will be sustained if developed. Nowea Energy Inc. beneficially owns approximately 99% of our total outstanding shares of common stock and controls all matters submitted to our stockholders for approval including the election of directors and approval of significant corporate transactions. Nowea Energy Inc. is a related party through common directors. You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with information different from that contained in this Prospectus. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of our common shares. The Company is an emerging growth company under the Jumpstart Our Business Startups Act. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. The date of this prospectus is _______, 2022 PROSPECTUS SUMMARY This Prospectus and any supplement to this Prospectus include forward-looking statements . To the extent that the information presented in this Prospectus discusses financial projections, information or expectations about our business plans, results of operations, products or markets, or otherwise makes statements about future events, such statements are forward-looking. Such forward-looking statements can be identified by the use of words such as intends , anticipates , believes , estimates , projects , forecasts , expects , plans and proposes . Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements. These include, among others, the cautionary statements in the Risk Factors section beginning on page 9 of this Prospectus and the Management s Discussion and Analysis of Financial Position and Results of Operations section beginning on page 34 of this Prospectus. This summary only highlights selected information contained in greater detail elsewhere in this Prospectus. This summary does not contain all of the information that you should consider before investing in our common stock. You should carefully read the entire Prospectus, including Risk Factors beginning on page 9, and the consolidated financial statements, before making an investment decision. Corporate Background and Business Overview ENERGIEINVESTING.COM INC. ( ENERGIEINVESTING.COM , the Company we or us ) is a development stage company. We were originally incorporated under the laws of the State of Florida on March 18, 2020 as NOWEA INC. On December 23, 2020, we filed a Certificate of Amendment whereby we changed our name to ENERGIEINVESTING.COM INC. We are in the business of oil and gas exploration in the United States with a secondary focus on acquiring alternative energy investments and rare earth exploration. During the period from March 18, 2020 (inception) through December 31, 2020 the Company acquired oil and gas properties consisting of 17 unproven wells across 7 mineral leases all within the state of Kentucky. The Company s working interest in the various leases ranges from 75% to 100%. The Company performs all maintenance, pumping and related activities on the wells. During the period from March 18, 2020 (inception) through December 31, 2020, the Company capitalized $20,000 of acquisition and development costs related to these leases, related to the asset retirement bond purchased in the State of Kentucky. Our fiscal year end is December 31. Our business offices are currently located at 2210 Front Street, Unit 206, Melbourne, Florida 32935. Our telephone number is (321)293-6003. We have two (2) executive officers, Joachim Haas, our President and Chief Executive Officer, and Achim Weber, our Chief Financial Officer. Our Director is Joachim Haas. We are a development stage company that has generated limited revenues and has had limited operations to date. As at December 31, 2021, the Company had recorded limited revenues, has a working capital deficit of $110,433, and has an accumulated deficit of $351,073. Through April 1, 2022, we have issued an aggregate of 45,992,100 shares of our common stock since our inception. We issued 100 shares of our common stock to the founding shareholder for services in connection with the formation and organization of the Company and sold the same founding shareholder 44,000,000 shares of common stock for total cash proceeds of $440,000. We issued 1,500,000 shares to the same founding shareholder for total cash proceeds $75,000. We issued a total of 492,000 shares of our common stock to forty-six (46) separate foreign shareholders and one (1) domestic shareholder through April 1, 2022, pursuant to a private placement of our common stock exempt from registration under Regulation S of the Securities Act of 1933, for total proceeds of approximately $24,600. Except for acquisition of the seventeen (17) leases described above, since our inception we have not made any significant purchase or sale of assets, nor have we been involved in any mergers, acquisitions or consolidations. Due to the uncertainty of our ability to meet our current operating and capital expenses, our independent auditors have included a going concern opinion in their report on our audited financial statements for the year ended December 31, 2021 and the period from March 18, 2020 (inception) through December 31, 2020. The notes to our financial statements contain additional disclosure describing the circumstances leading to the issuance of a going concern opinion by our auditors. Implications of Being an Emerging Growth Company As a company with less than $1 billion in revenue in our last fiscal year, we are defined as an emerging growth company under the Jumpstart Our Business Startups ( JOBS ) Act. We will retain emerging growth company status until the earliest of: The last day of the fiscal year during which our annual revenues are equal to or exceed $1 billion; The last day of the fiscal year following the fifth anniversary of our first sale of common stock pursuant to a registration statement filed under the Securities Act of 1933, as amended, which we refer to in this document as the Securities Act; The date on which we have issued more than $1 billion in nonconvertible debt in a previous three-year period; or The date on which we qualify as a large accelerated filer under Rule 12b-2 adopted under the Securities Exchange Act of 1934, as amended (the Exchange Act ) (i.e., an issuer with a public float of $700 million that has been filing reports with the U.S. Securities and Exchange Commission ( SEC ) under the Exchange Act for at least 12 months). As an emerging growth company, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to SEC reporting companies. For so long as we remain an emerging growth company we will not be required to: have an auditor report on our internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Wall Street Reform and Consumer Protection Act of 2002; comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); submit certain executive compensation matters to stockholder non-binding advisory votes; submit for stockholder approval golden parachute payments not previously approved; disclose certain executive compensation related items, as we will be subject to the scaled disclosure requirements of a smaller reporting company with respect to executive compensation disclosure; and present more than two years of audited financial statements and two years of selected financial data in this registration statement and future filings, instead of the customary three years for audited financial statements and five years for selected financial data. Pursuant to Section 107(b) of the JOBS Act, we have elected to not use the extended transition period for complying with new or revised accounting standards under Section 102(b)(2) of The JOBS Act. This election is irrevocable. Because the worldwide market value of our common stock held by non-affiliates, or public float, is below $75 million, we are also a smaller reporting company as defined under the Exchange Act. Some of the foregoing reduced disclosure and other requirements are also available to us because we are a smaller reporting company and may continue to be available to us even after we are no longer an emerging growth company under the JOBS Act but remain a smaller reporting company under the Exchange Act. As a smaller reporting company we are not required to: have an auditor report on our internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; and present more than two years of audited financial statements in our registration statements and annual reports on Form 10-K and present any selected financial data in such registration statements and annual reports. Summary of the Offering Shares of common stock being offered by the Registrant: 492,000 shares (the Maximum Offering ) of the Selling Shareholder s common stock. Offering price: $0.50 per share of common stock. Number of shares outstanding before the Offering: As of April 1, 2022, we had 45,992,100 shares of our common stock issued and outstanding, and no issued and outstanding convertible securities. Number of shares outstanding after the Offering 45,992,100 if all of the shares being offered are sold. Market for the common stock: There is no public market for our common stock. After the effective date of the registration statement of which this prospectus is a part, we intend to seek a market maker to file an application on our behalf to have our common stock quoted on the Over-the-Counter Bulletin Board. We may never be approved for trading on any exchange. We currently have no market maker who is willing to list quotations for our stock. There is no assurance that a trading market for our stock will develop be sustained if developed. Use of Proceeds: No proceeds to the Company.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001901056_energieinv_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001901056_energieinv_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..70bd72a240a4183dc0fe0ac1fdd8335c2bbbf4c6
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001901056_energieinv_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This Prospectus and any supplement to this Prospectus include forward-looking statements . To the extent that the information presented in this Prospectus discusses financial projections, information or expectations about our business plans, results of operations, products or markets, or otherwise makes statements about future events, such statements are forward-looking. Such forward-looking statements can be identified by the use of words such as intends , anticipates , believes , estimates , projects , forecasts , expects , plans and proposes . Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements. These include, among others, the cautionary statements in the Risk Factors section beginning on page 9 of this Prospectus and the Management s Discussion and Analysis of Financial Position and Results of Operations section beginning on page 34 of this Prospectus. This summary only highlights selected information contained in greater detail elsewhere in this Prospectus. This summary does not contain all of the information that you should consider before investing in our common stock. You should carefully read the entire Prospectus, including Risk Factors beginning on page 9, and the consolidated financial statements, before making an investment decision. Corporate Background and Business Overview ENERGIEINVESTING.COM INC. ( ENERGIEINVESTING.COM , the Company we or us ) is a development stage company. We were originally incorporated under the laws of the State of Florida on March 18, 2020 as NOWEA INC. On December 23, 2020, we filed a Certificate of Amendment whereby we changed our name to ENERGIEINVESTING.COM INC. We are in the business of oil and gas exploration in the United States with a secondary focus on acquiring alternative energy investments and rare earth exploration. During the period from March 18, 2020 (inception) through December 31, 2020 the Company acquired oil and gas properties consisting of 17 unproven wells across 7 mineral leases all within the state of Kentucky. The Company s working interest in the various leases ranges from 75% to 100%. The Company performs all maintenance, pumping and related activities on the wells. During the period from March 18, 2020 (inception) through December 31, 2020, the Company capitalized $20,000 of acquisition and development costs related to these leases, related to the asset retirement bond purchased in the State of Kentucky. Our fiscal year end is December 31. Our business offices are currently located at 2210 Front Street, Unit 206, Melbourne, Florida 32935. Our telephone number is (321)293-6003. We have two (2) executive officers, Joachim Haas, our President and Chief Executive Officer, and Achim Weber, our Chief Financial Officer. Our Director is Joachim Haas. We are a development stage company that has generated limited revenues and has had limited operations to date. As at December 31, 2021, the Company had recorded limited revenues, has a working capital deficit of $110,433, and has an accumulated deficit of $351,073. Through April 25, 2022, we have issued an aggregate of 45,992,100 shares of our common stock since our inception. We issued 100 shares of our common stock to the founding shareholder for services in connection with the formation and organization of the Company and sold the same founding shareholder 44,000,000 shares of common stock for total cash proceeds of $440,000. We issued 1,500,000 shares to the same founding shareholder for total cash proceeds $75,000. We issued a total of 492,000 shares of our common stock to forty-six (46) separate foreign shareholders and one (1) domestic shareholder through April 25, 2022, pursuant to a private placement of our common stock exempt from registration under Regulation S of the Securities Act of 1933, for total proceeds of approximately $24,600. Except for acquisition of the seventeen (17) leases described above, since our inception we have not made any significant purchase or sale of assets, nor have we been involved in any mergers, acquisitions or consolidations. The information in this prospectus is not complete and may be amended. The Registrant may not sell these securities until the Registration Statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION DATED ___________, 2022 PRELIMINARY PROSPECTUS ENERGIEINVESTING.COM INC. 492,000 SHARES OF COMMON STOCK OFFERING PRICE $0.50 PER SHARE This prospectus relates to the offering (the Offering ) of 492,000 shares of our common stock by our Selling Shareholders at a fixed offering price of $0.50 per share until our shares are quoted on the Over-the-Counter Bulletin Board, and thereafter at prevailing market prices or privately negotiated prices. We will pay all expenses incurred in this Offering (other than transfer taxes), and the Selling Shareholders will receive all of the net proceeds from this Offering. AN INVESTMENT IN OUR SECURITIES IS SPECULATIVE. INVESTORS SHOULD BE ABLE TO AFFORD THE LOSS OF THEIR ENTIRE INVESTMENT. YOU SHOULD CAREFULLY CONSIDER THE FACTORS DESCRIBED UNDER THE HEADING RISK FACTORS BEGINNING ON PAGE 12 BEFORE INVESTING IN OUR COMMON STOCK. Prior to this Offering, there has been no public market for our common stock and we have not applied for the listing or quotation of our common stock on any public market. We have arbitrarily determined the offering price of $0.50 per share in relation to this Offering. The offering price bears no relationship to our assets, book value, earnings or any other customary investment criteria. After the effective date of the registration statement, we intend to seek a market maker to file an application with the Financial Industry Regulatory Authority ( FINRA ) to have our common stock quoted on the OTC Bulletin Board. We may never be approved for trading on any exchange. We currently have no market maker who is willing to list quotations for our stock. There is no assurance that an active trading market for our shares will develop or will be sustained if developed. Nowea Energy Inc. beneficially owns approximately 99% of our total outstanding shares of common stock and controls all matters submitted to our stockholders for approval including the election of directors and approval of significant corporate transactions. Nowea Energy Inc. is a related party through common directors. Our Chief Executive Officer and director, Joachim Haas, is also the Chief Executive Officer and director of Nowea Energy Inc. and exercises direct control over its investment decisions. You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with information different from that contained in this Prospectus. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of our common shares. The Company is an emerging growth company under the Jumpstart Our Business Startups Act. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. The date of this prospectus is _______, 2022 PROSPECTUS SUMMARY This Prospectus and any supplement to this Prospectus include forward-looking statements . To the extent that the information presented in this Prospectus discusses financial projections, information or expectations about our business plans, results of operations, products or markets, or otherwise makes statements about future events, such statements are forward-looking. Such forward-looking statements can be identified by the use of words such as intends , anticipates , believes , estimates , projects , forecasts , expects , plans and proposes . Although we believe that the expectations reflected in these forward-looking statements are based on reasonable assumptions, there are a number of risks and uncertainties that could cause actual results to differ materially from such forward-looking statements. These include, among others, the cautionary statements in the Risk Factors section beginning on page 9 of this Prospectus and the Management s Discussion and Analysis of Financial Position and Results of Operations section beginning on page 34 of this Prospectus. This summary only highlights selected information contained in greater detail elsewhere in this Prospectus. This summary does not contain all of the information that you should consider before investing in our common stock. You should carefully read the entire Prospectus, including Risk Factors beginning on page 9, and the consolidated financial statements, before making an investment decision. Corporate Background and Business Overview ENERGIEINVESTING.COM INC. ( ENERGIEINVESTING.COM , the Company we or us ) is a development stage company. We were originally incorporated under the laws of the State of Florida on March 18, 2020 as NOWEA INC. On December 23, 2020, we filed a Certificate of Amendment whereby we changed our name to ENERGIEINVESTING.COM INC. We are in the business of oil and gas exploration in the United States with a secondary focus on acquiring alternative energy investments and rare earth exploration. During the period from March 18, 2020 (inception) through December 31, 2020 the Company acquired oil and gas properties consisting of 17 unproven wells across 7 mineral leases all within the state of Kentucky. The Company s working interest in the various leases ranges from 75% to 100%. The Company performs all maintenance, pumping and related activities on the wells. During the period from March 18, 2020 (inception) through December 31, 2020, the Company capitalized $20,000 of acquisition and development costs related to these leases, related to the asset retirement bond purchased in the State of Kentucky. Our fiscal year end is December 31. Our business offices are currently located at 2210 Front Street, Unit 206, Melbourne, Florida 32935. Our telephone number is (321)293-6003. We have two (2) executive officers, Joachim Haas, our President and Chief Executive Officer, and Achim Weber, our Chief Financial Officer. Our Director is Joachim Haas. We are a development stage company that has generated limited revenues and has had limited operations to date. As at December 31, 2021, the Company had recorded limited revenues, has a working capital deficit of $110,433, and has an accumulated deficit of $351,073. Through April 25, 2022, we have issued an aggregate of 45,992,100 shares of our common stock since our inception. We issued 100 shares of our common stock to the founding shareholder for services in connection with the formation and organization of the Company and sold the same founding shareholder 44,000,000 shares of common stock for total cash proceeds of $440,000. We issued 1,500,000 shares to the same founding shareholder for total cash proceeds $75,000. We issued a total of 492,000 shares of our common stock to forty-six (46) separate foreign shareholders and one (1) domestic shareholder through April 25, 2022, pursuant to a private placement of our common stock exempt from registration under Regulation S of the Securities Act of 1933, for total proceeds of approximately $24,600. Except for acquisition of the seventeen (17) leases described above, since our inception we have not made any significant purchase or sale of assets, nor have we been involved in any mergers, acquisitions or consolidations. Due to the uncertainty of our ability to meet our current operating and capital expenses, our independent auditors have included a going concern opinion in their report on our audited financial statements for the year ended December 31, 2021 and the period from March 18, 2020 (inception) through December 31, 2020. The notes to our financial statements contain additional disclosure describing the circumstances leading to the issuance of a going concern opinion by our auditors. Implications of Being an Emerging Growth Company As a company with less than $1 billion in revenue in our last fiscal year, we are defined as an emerging growth company under the Jumpstart Our Business Startups ( JOBS ) Act. We will retain emerging growth company status until the earliest of: The last day of the fiscal year during which our annual revenues are equal to or exceed $1 billion; The last day of the fiscal year following the fifth anniversary of our first sale of common stock pursuant to a registration statement filed under the Securities Act of 1933, as amended, which we refer to in this document as the Securities Act; The date on which we have issued more than $1 billion in nonconvertible debt in a previous three-year period; or The date on which we qualify as a large accelerated filer under Rule 12b-2 adopted under the Securities Exchange Act of 1934, as amended (the Exchange Act ) (i.e., an issuer with a public float of $700 million that has been filing reports with the U.S. Securities and Exchange Commission ( SEC ) under the Exchange Act for at least 12 months). As an emerging growth company, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable generally to SEC reporting companies. For so long as we remain an emerging growth company we will not be required to: have an auditor report on our internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Wall Street Reform and Consumer Protection Act of 2002; comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); submit certain executive compensation matters to stockholder non-binding advisory votes; submit for stockholder approval golden parachute payments not previously approved; disclose certain executive compensation related items, as we will be subject to the scaled disclosure requirements of a smaller reporting company with respect to executive compensation disclosure; and present more than two years of audited financial statements and two years of selected financial data in this registration statement and future filings, instead of the customary three years for audited financial statements and five years for selected financial data. Pursuant to Section 107(b) of the JOBS Act, we have elected to not use the extended transition period for complying with new or revised accounting standards under Section 102(b)(2) of The JOBS Act. This election is irrevocable. Because the worldwide market value of our common stock held by non-affiliates, or public float, is below $75 million, we are also a smaller reporting company as defined under the Exchange Act. Some of the foregoing reduced disclosure and other requirements are also available to us because we are a smaller reporting company and may continue to be available to us even after we are no longer an emerging growth company under the JOBS Act but remain a smaller reporting company under the Exchange Act. As a smaller reporting company we are not required to: have an auditor report on our internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; and present more than two years of audited financial statements in our registration statements and annual reports on Form 10-K and present any selected financial data in such registration statements and annual reports. Summary of the Offering Shares of common stock being offered by the Registrant: 492,000 shares (the Maximum Offering ) of the Selling Shareholder s common stock. Offering price: $0.50 per share of common stock. Number of shares outstanding before the Offering: As of April 25, 2022, we had 45,992,100 shares of our common stock issued and outstanding, and no issued and outstanding convertible securities. Number of shares outstanding after the Offering 45,992,100 if all of the shares being offered are sold. Market for the common stock: There is no public market for our common stock. After the effective date of the registration statement of which this prospectus is a part, we intend to seek a market maker to file an application on our behalf to have our common stock quoted on the Over-the-Counter Bulletin Board. We may never be approved for trading on any exchange. We currently have no market maker who is willing to list quotations for our stock. There is no assurance that a trading market for our stock will develop be sustained if developed. Use of Proceeds: No proceeds to the Company.
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+S-1/A 1 aurafat_s1a.htm S-1/A As Filed with the U.S. Securities and Exchange Commission on March 31, 2022 Registration No. 333-263717 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Pre-Effective Amendment No. 1 to FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 AURA FAT PROJECTS ACQUISITION CORP (Exact name of registrant as specified in its charter) Cayman Islands 6770 N/A (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) 1 Phillip Street, #09-00 Royal One Phillip Singapore, 048692 Telephone: 65-3135-1511 (Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant s Principal Executive Offices) Cogency Global Inc. 122 East 42nd Street, 18th Floor New York, New York 10168 Telephone: 1-800-221-0102 (Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent For Service) Copies to: Andrew M. Tucker Nelson Mullins Riley & Scarborough LLP 101 Constitution Avenue, NW. Suite 900 Washington, D.C. 20001 (202) 689-2800 David M. Loev John S. Gillies The Loev Law Firm, PC 6300 West Loop South, Suite 280 Bellaire, TX 77401 (713) 524-4110 Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED March 31, 2022 $100,000,000 AURA FAT PROJECTS ACQUISITION CORP 10,000,000 Units Aura FAT Projects Acquisition Corp is a newly organized blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business combination throughout this prospectus. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. We will not be limited to a particular industry or geographic region in our identification and acquisition of a target company. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share and one redeemable warrant. Only whole warrants are exercisable. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as described herein. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. The underwriters have a 45-day option from the date of this prospectus to purchase up to an additional 1,500,000 units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their shares of our Class A ordinary share upon the completion of our initial business combination, subject to the limitations described herein. We will have until 15 months from the consummation of this offering to consummate our initial business combination (such period may be extended by the Company s shareholders in accordance with our amended and restated memorandum and articles of association) (the "Combination Period"). We may seek the ordinary resolution of the public shareholders for (i) an extension and (ii) the approval of the amendment to the trust agreement entered into between us and Continental Stock Transfer & Trust Company at a meeting called for such purpose if we anticipate that we may not be able to consummate our initial business combination within 15 months. Public shareholders will be offered the opportunity to vote on and/or redeem their shares in connection with the approval of such extension. Alternatively, or in the event that there is an unsuccessful effort to obtain shareholder approval for the proposed extension(s) we may, but are not obligated to, extend the Combination Period up to two times by an additional three months each time for a total of up to 21 months, respectively, by depositing into the trust account for each three-month extension $1,000,000, or $1,150,000 if the underwriters over-allotment option is exercised in full ($0.10 per unit in either case). In the event we elect to extend the deadline, we intend to issue a press release announcing such intention at least three days prior to the applicable deadline. In addition, we intend to issue a press release the day after the applicable deadline announcing whether or not the funds have been timely deposited. Public shareholders, in this situation, will not be offered the opportunity to vote on and/or redeem their shares. If we are unable to complete our initial business combination within 15 months from the closing of this offering (or up to 21 months if we extend the period of time to consummate a business combination, as described in more detail in this prospectus), we will redeem 100% of the public shares for cash, subject to applicable law and certain conditions as further described herein. Our sponsor, Aura FAT Projects Capital LLC, a Cayman Islands limited liability company, has agreed to purchase an aggregate of 4,550,000 placement warrants (or 5,000,000 placement warrants if the over-allotment option is exercised in full) at a price of $1.00 per warrant, for an aggregate purchase price of $4,550,000 ($5,000,000 if the over-allotment option is exercised in full). Each placement warrant will be identical to the warrant sold in this offering, except as described in this prospectus. The placement warrant will be sold in a private placement that will close simultaneously with the closing of this offering. Our initial shareholders currently own an aggregate of 2,875,000 Class B ordinary shares (up to 375,000 shares of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised), Our Class B ordinary shares will automatically convert into Class A ordinary shares at the time of the consummation of our initial business combination, on a one-for-one basis, subject to adjustment as described herein. Table of Contents Currently, there is no public market for our units, Class A ordinary shares, or warrants. We have applied to list our units, Class A ordinary shares and warrants on The Nasdaq Global Market, or Nasdaq, under the symbols "AFARU", "AFAR" and "AFARW". We expect that our units will be listed on The Nasdaq Global Market on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on Nasdaq. We expect the Class A ordinary shares and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless the representative informs us of its decision to allow earlier separate trading, subject to our satisfaction of certain conditions. Once the securities comprising the units begin separate trading, we expect that the Class A ordinary share and warrants will be listed on Nasdaq under the symbols "AFARU" and "AFARW", respectively. We are an "emerging growth company" under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See "Risk Factors" beginning on page 32 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 100,000,000 Underwriting discounts and commissions(1) $ 0.45 $ 4,500,000 Proceeds, before expenses, to us $ 9.55 $ 95,500,000 (1) Includes $0.35 per unit, or $3,500,000 (or $4,025,000 if the over-allotment option is exercised in full) in the aggregate, payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein. The deferred commissions will be released to the representative of the underwriters only on completion of an initial business combination, as described in this prospectus. Does not include certain fees and expenses payable to the underwriters in connection with this offering. In addition, we will issue EF Hutton, division of Benchmark Investments, LLC ("Hutton"), the representative of the underwriters, and/or its designees 100,000 Class A ordinary shares (115,000 if the over-allotment option is exercised in full), which we refer to herein as the "representative shares" as underwriter compensation in connection with this offering. See the section of this prospectus entitled "Underwriting" beginning on page 164 for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the placement warrants described in this prospectus, $102.00 million or $117.30 million if the underwriters over-allotment option is exercised in full ($10.20 per unit in either case) will be deposited into a trust account in the United States with Continental Stock Transfer & Trust Company acting as trustee. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about [ ]. EF HUTTON division of Benchmark Investments, LLC The date of this Prospectus is [ ] Table of Contents TABLE OF CONTENTS Page Summary 1 Risk Factors 32 Cautionary Note Regarding Forward-Looking Statements 74 Use of Proceeds 75 Dividend Policy 79 Dilution 80 Capitalization 82 Management s Discussion and Analysis of Financial Condition and Results of Operations 83 Proposed Business 89 Management 118 Principal Shareholders 128 Certain Relationships and Related Party Transactions 130 Description of Securities 133 Taxation 151 Underwriting 164 Legal Matters 173 Experts 173 Where You Can Find Additional Information 173 Index to Financial Statements F-1 We are responsible for the information contained in this prospectus. We have not authorized anyone to provide you with different information, and we take no responsibility for any other information others may give to you. We are not, and the underwriters are not, making an offer to sell securities in any jurisdiction where the offer or sale is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front of this prospectus. No dealer, salesperson or any other person is authorized to give any information or make any representations in connection with this offering other than those contained in this prospectus and, if given or made, the information or representations must not be relied upon as having been authorized by us. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any security other than the securities offered by this prospectus, or an offer to sell or a solicitation of an offer to buy any securities by anyone in any jurisdiction in which the offer or solicitation is not authorized or is unlawful. This prospectus includes estimates regarding market and industry data and forecasts which are based on publicly available information, industry reports and publications, reports from government agencies and management s estimates based on third-party data. Third-party industry publications and forecasts generally state that the information contained therein has been obtained from sources generally believed to be reliable. We have not independently verified such third-party information, nor have we ascertained the underlying economic assumptions relied upon in those sources, and we cannot assure you of the accuracy or completeness of such information contained in this prospectus.
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+PROSPECTUS SUMMARY 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, references to: Affiliated SPAC are to Abri SPAC I, Inc.; amended and restated certificate of incorporation refers to our certificate of incorporation to be in effect upon the completion of this offering; company we, us, or our company refer to Abri SPAC 2, Inc., a Delaware corporation; Chardan refers to Chardan Capital Markets, LLC, the representative of the underwriters; directors refers to our directors and director nominees; initial stockholders refers to all of our stockholders immediately prior to the date of this prospectus, including our sponsor and officers and directors to the extent they hold such shares; insider shares or founder shares refer to the 2,875,000 shares of common stock held or controlled by our insiders (as defined below) prior to this offering, which include up to an aggregate of 375,000 shares of common stock subject to forfeiture by our insiders to the extent that the underwriters over-allotment option is not exercised in full or in part; insiders refer to our officers, directors, sponsor and any holder of our insider shares; letter agreement refers to the letter agreement, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team refer to our officers and directors; private units refer to the units we are selling to our sponsor and/or its designee in a private placement simultaneously with the closing of this offering; private warrants refer to the warrants underlying the private units; public shares refer to shares of common stock which are being sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and references to public stockholders refer to the holders of our public shares, including our insiders to the extent our insiders purchase public shares, provided that their status as public stockholders shall exist only with respect to such public shares; public warrants refer to the warrants which are being sold as part of the units in this offering; rights refers to the rights sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market), each to receive one-tenth (1/10) of one share of common stock upon the consummation of an initial business combination; sponsor refers to Abri Ventures 2, LLC, a Delaware limited liability company; and warrants refers to our warrants, which includes the public warrants as well as the private warrants to the extent they are no longer held by the initial purchasers of the private warrants or their permitted transferees. Certain financial information contained in this prospectus has been rounded and, as a result, certain totals shown in this prospectus may not equal the arithmetic sum of the figures that should otherwise aggregate to those totals. You should rely only on the information contained in this prospectus. We have not, and the underwriters have not, authorized anyone to provide you with different information. We are not, and the underwriters are not, making an offer of these securities in any jurisdiction where the offer is not permitted. 1 Table of Contents General We are a newly formed blank check company incorporated in the state of Delaware on July 19, 2021, for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or other similar business combination, involving one or more businesses or assets, which we refer to throughout this prospectus as our business combination . To date, our efforts have been limited to organizational activities as well as activities related to this offering. We have not identified any acquisition target and we have not, nor has anyone on our behalf, initiated any discussions, directly or indirectly, with respect to identifying any acquisition target. We have generated no operating revenues to date, and we do not expect that we will generate operating revenues until we consummate our initial business combination. Although we may pursue a business combination opportunity in any business, industry or geographic location, we currently intend to focus our efforts on identifying high growth technology and technology enabled businesses that power transformation and provide disruptive technological innovation with the ability to leverage innovative intellectual property ( IP ), content and data or know-how to develop a sustainable competitive advantage that can dislodge slower moving incumbents in the target s selected end markets. Significant advances in software development, distributed computing, and processing power along with a broadening of artificial intelligence applications, massive digitization of data and/or content and the rapid decline in the cost of cloud computing has enabled companies to create scalable technology architectures and applications capable of not only competing in, but disrupting, entire established and large-scale industries. Technological innovation is having a transformative impact on how societies live, work and interact. The ongoing migration of enterprises and consumers to web-, mobile-, and cloud-based technologies has driven a proliferation of new user experiences, services, and the rapid development and deployment of a variety of supporting technology infrastructures. The level of inter-connection across a variety of industries and services has dramatically increased and we expect this trend to continue. We believe these trends will continue to drive further innovation in all levels of the technology stack and lead to the development of new businesses and business models, such as SaaS and cloud-based services, clean power generation and utilization, novel transportation solutions, and new modes of physical and electronic distribution that deliver efficiency, productivity, improved customer experiences and lessened environmental impact across many industries. While we believe that disruptive technologies cut across many economic sectors and geographies and represent platform level changes for the next wave of technology-intense companies to be built on or with, we believe that the tech-enabled managed services, media, digital content, data analytics, transportation, distribution and manufacturing sectors are particularly ripe for software and IP-enabled disruption. We believe there is a significant opportunity for a forward-thinking businesses to use disruptive innovation and technology to quickly take market share and become a scaled player. We will use our management team s expertise in fundamental business analysis and due diligence to identify and confirm the strength of any business we evaluate. We intend to capitalize on our management team s experience and expertise in understanding and pursuing disruptive and transformative trends and developments in companies that can scale their existing businesses and platforms by taking advantage of these disruptive trends across multiple industries, including the financial services, data analytics, digital content, distribution, clean technology, media and entertainment, and manufacturing. For example, in recent years, the media and entertainment ( M&E ) industry has seen a significant convergence with other industries (for example, distributed and cloud services, technology and telecommunications) driven by the widespread adoption of digitized content. Within M&E, there are several high growth segments such as gaming, animation content and digital distribution while others, such as print, are facing existential challenges unless they innovate their business models to provide digital content and distribution. We have also seen the consumption of products by end-users in the space increase in this new environment. The global market for segments focused on streaming, digital content, music, audio recordings, gaming, and ancillary advertising, services, and analytical products is forecast to reach roughly US$2.5 trillion by 2024, according to Perspectives from the Global Entertainment & Media Outlook 2021-2025 report by PricewaterhouseCoopers (PwC). Another area on which we are focused is disruptive distribution technology that allows for the delivery of both physical and electronic products in new and novel ways. For example, we are focused on new methods of commercial goods transportation and distribution in ways that significantly reduce the environmental footprint of this activity while at the same time offering end users significant operational cost savings from reduced fuel consumption, reduced servicing costs and reduced infrastructure costs of infrastructure alternations. For electronic distribution, we are focused mainly on the provisioning of relevant end user services and content. 2 Table of Contents Our Management Team Our Executive Officers Our management team is led by Jeffrey Tirman, our Chairman and Chief Executive Officer, and will be complemented by a broader team of seasoned executives serving as directors and advisors. Jeffrey Tirman, our Chairman of our Board of Directors and Chief Executive Officer since 2021, has over 30 years of international investment and corporate management experience, specializing in discrete corporate transactions, senior corporate strategy development and management, turnarounds, and restructurings (operational and financial). Since beginning his career, Mr. Tirman has executed and structured several complex international corporate transactions both on behalf of independent shareholders and as primary shareholder. Mr. Tirman has also negotiated, executed and participated in numerous types of transactions, including public listings, spin-offs, administration proceedings, organizing and leading creditor committees, corporate rationalizations, acquisitions and divestitures, and balance sheet refinancing, as well as analyzing and executing numerous debt and equity investments and capital structure arbitrage positions. Mr. Tirman founded Abri Advisors Ltd, in Bermuda in 2016 and Abri Advisors (UK) Ltd. in the United Kingdom in 2020 to invest across a variety of asset classes, and to provide corporate advisory services focused on corporate turnarounds and restructuring. Since April 2021, Mr. Tirman has served as Chairman and CEO of Abri SPAC I, an Affiliated SPAC. Mr. Tirman is also the managing member and a director of Abri Ventures 2, LLC, our Sponsor, and chief executive officer of Abri Sponsor Company Ltd, and Abri Advisors, Inc., both private equity holding companies. Mr. Tirman also serves as the managing member and a director of Abri Ventures I, LLC, the sponsor to Abri SPAC I, Inc., an Affiliated SPAC. Since January 2016, Mr. Tirman had been the Chairman and CEO, and still serves as CEO of Elan d.o.o., based in Slovenia, and sits on the boards of several Elan subsidiaries. Since May 2019, Mr. Tirman has been the CEO and Director of Luxembourg-based KJK Sports S.A. and sits on the boards of several holdings thereunder including Tahe Outdoors based in France and Estonia, Baltic Vairus based in Lithuania, and Leader 96 based in Bulgaria. As of December 31, 2021, these companies employed more than 3,000 people and generated revenues in excess of 350 million. Mr. Tirman is charged with leading the operational and financial restructuring of these companies with the aim of increasing operational efficiency, financial performance and transparency, along with the implementation of standardized business practices and transparent corporate governance principles. From 2009 through 2014, Mr. Tirman was an adjunct professor of Advanced Corporate Finance for the Master of Sciences in Finance (MScF) program at l Ecole des Hautes Etudes Commerciales (HEC) in Lausanne, Switzerland, which is a joint effort between l Universit de Lausanne (UNIL), Ecole Polytechnique F d rale de Lausanne (EPFL) and the Federal Swiss Banking and Finance Institute. From 2011 through 2013, Mr. Tirman was also a guest lecturer on Credit Markets and Credit Risk for the Asset and Wealth Management Executive MBA (AWEMBA) program at the HEC, which was a joint program between University of Lausanne and the Tepper School of Management at Carnegie Mellon University, in Pennsylvania, USA. Mr. Tirman s lectures focused on risk assessment and analysis. Mr. Tirman received an MBA in Corporate Tax & Accounting from Tulane University in 1990 and a BA in Economics & Finance from the University of Arkansas in 1987. Nima Montazeri, our Executive Vice President and Chief Operating Officer since 2021, has more than 21 years of experience in corporate finance and is experienced in matters related to financing public and private companies. Mr. Montazeri has substantial experience in structuring complex financing instruments and private placements for small and mid-cap public companies, including working with many companies to design and implement operational and management restructuring plans. Since September 2021, Mr. Montazeri has served as chief operating officer and a director of Abri SPAC I, an Affiliated SPAC. Mr. Montazeri is also the chief operating officer of Abri Advisors Ltd, in Bermuda, and Abri Advisors (UK) Ltd. Mr. Montazeri has advised numerous small and mid-cap companies on growth strategies with a focus on international business development and expansion. Since March 2017, Mr. Montazeri has been a general partner at Brown Stone Capital, LP., focused on investment management. Previously, from 2008 to 2017, Mr., Montazeri was a Managing Director at Floyd Associates, Inc., leading management and financial consulting efforts and investing across multiple asset classes. Mr. Montazeri is also the President of Hyperion Capital and Silver Rock Associates Inc. Since 2012, Mr. Montazeri has been an active money manager focused on equity, fixed income, real estate, and derivative strategies. Mr. Montazeri has assisted several clean energy and automotive solution companies with their capital development efforts by organizing access to strategic sources of capital, as well as advising on new and expanding markets. Furthermore, he played an instrumental role in raising international capital for a California based concentrated solar power company. In 2003 3 Table of Contents he led an innovative technology transfer program from NASA s Jet Propulsion Laboratory which resulted in the development of a novel biological detection instrument. Mr. Montazeri has an extensive network of international investment and finance relationships providing access to a variety of transactions and differentiated investment opportunities, along with a robust capital raising network. Furthermore, Mr. Montazeri is the author of several research reports related to clean energy, defense, counter terrorism, and natural resources. As an economist, he has conducted extensive research on international trade, openness, and the resulting impact on economic growth. Mr. Montazeri s research covered the analysis of thousands of historical bilateral trade figures in an attempt to discover statistically significant correlations between openness to trade and real economic growth. Mr. Montazeri received a BA with honors in Economics from the University of British Columbia in 2000 and Master s in Finance and Accounting from the London School of Economics and Political Science in 2003. Christopher Hardt, our Chief Financial Officer and a director of the Company since 2021, has more than 30 years of Big 4 audit, compliance, reporting and international corporate advisory experience. Since September 2021, Mr. Hardt has served as Chief Financial Officer of Abri SPAC I, an Affiliated SPAC. In 2021, Mr. Hardt retired from PwC LLP where he was an audit partner since 2000. Mr. Hardt is also the Chief Financial Officer of Abri Advisors Ltd, in Bermuda, and Abri Advisors (UK) Ltd. Mr. Hardt has been based previously in PwC s offices in London, England, Lausanne, Switzerland and Tokyo, Japan in addition to several offices in the United States. During his tenure at PwC, he was a lead partner on several large multinational audit clients in the Consumer Markets, Technology, Media, Automotive, Banking and Insurance industries and has conducted business in over 40 countries. Mr. Hardt has also served as a leader in PwC s SEC Services group in the firm s National Office where he was responsible for oversight of both foreign and domestic registrant client SEC filings including both debt and equity IPOs. Through his prior roles at PwC, Mr. Hardt has extensive experience with companies preparing to go public including the financial statement and internal controls requirements of The Sarbanes-Oxley Act, interacting with the Securities and Exchange Commission and the financial reporting implications of executing growth strategies involving mergers and acquisitions. Mr. Hardt also has many years of experience interacting with public company boards and their audit/finance committees. Mr. Hardt is an investor and adviser to Cavan & Co LLC, an early-stage American made lifestyle apparel brand. Mr. Hardt received a BA in Business Administration from Furman University in 1988 and is a CPA licensed in Ohio, Georgia and New Jersey. Mr. Hardt serves on the President s Advisory Council of Furman University and is a member of the Parents Board at The Georgia Institute of Technology. Mr. Hardt is well qualified to serve on our board due to his international expertise, experience with public company boards, involvement with the IPO process at other companies and financial expertise having been an audit partner at PwC for over 20 years. Peter Bakker, our Vice President of Business Analytics since 2021, has more than 30 years of experience in high-yield debt finance, portfolio management, secured lending, and SME trade finance. Since April 2021, Mr. Bakker has served as Vice President of Business Analytics for Abri SPAC I, an Affiliated SPAC. Mr. Bakker has been a Vice President at Abri Advisors Ltd. since June 2019 where he focused on corporate evaluation and M&A. From January 2015 to June 2019, Mr. Bakker was the Chief Risk Officer at Channel Capital Advisors, where he oversaw risk management. Mr. Bakker has extensive knowledge of credit analysis and debt service capacity of corporate borrowers; the turnaround/workout/recovery process; financial restructuring; valuation and analysis of highly levered and distressed capital structures; and arranging financing for SME s. Mr. Bakker s extensive international experience includes bank lending to finance leveraged buyouts, distressed investing on behalf of institutional clients, advising a leading Canadian hedge fund on its leveraged loan portfolio, and managing risk and workouts for a European FinTech platform providing financing to SME s. He has also directly led the restructuring of several distressed SME s, and he has raised significant leveraged acquisition financing and arranged several pre-pack bankruptcies in order to facilitate financial restructuring. Mr. Bakker received an MBA in Business Administration from the Tuck School of Business at Dartmouth University in 1979 and an MS in Economics from Erasmus University. 4 Table of Contents Amy Wall, our Vice President of Operations since 2021, has more than 20 years of experience in financial controlling, international operations, and back-office administration. Since April 2021, Mrs. Wall has served as Vice President of Operations of Abri SPAC I, an Affiliated SPAC. Mrs. Wall has been VP of Operations for Abri Advisors Ltd. since its founding in 2016, where she manages all corporate organizational matters as well as financial reporting and controlling. From 2013 to 2016, Mrs. Wall was the financial accountant and controller for FCA/SEC regulated Rhodium Capital based in London. From 1998 to 2016, Mrs. Wall served as the financial accountant, controller and back-office operations manager for SEC regulated Talisman Capital. Mrs. Wall and Mr. Tirman have worked together since 1998. Our Directors Nominees We have assembled a group of experienced corporate executives and professional advisors to serve as independent directors on our board, alongside Messrs. Tirman, Montazeri and Hardt. These executives have been chosen as nominees to the board of directors for their extensive sector and C-suite level experience in managing successful companies. In addition to providing us with strategic insights, which include in-depth knowledge of industry dynamics, competition and operational capabilities, our independent director nominees will provide access to their broad networks of operating executives and other resources. Nadine Watt has agreed to serve on our board of directors as of the closing of this offering. Since August 2021, Ms. Watt has served on the board of directors of Abri SPAC I, an Affiliated SPAC. Since December 2019, Ms. Watt has served as the CEO of Watt Companies and has more than 20 years of management and investment experience. She oversees the day-to-day activities and strategic planning for all commercial investment activities including acquisitions, development, and asset management for the Watt Companies 6 million-square-foot portfolio. Previously, Ms. Watt served as President of Watt Companies from 2011 to 2019. In 2011, she led a strategic reorganization of the company that moved the firm beyond traditional property management and leasing to a focus on acquisitions and real estate development, as well as joint venture opportunities. Ms. Watt played a key role in launching Watt Companies acquisition division Watt Investment Partners that now actively invests $60 million in a variety of property types across the Western United States. Ms. Watt has served on the Board of Directors of Fisker, Inc. since June 2020. Fisker, Inc. is an eco-friendly electric vehicles manufacturer. Throughout her 20-year tenure at Watt Companies, Ms. Watt has touched all facets of the company s operations, including the development of hundreds of apartment units and multiple shopping centers. Ms. Watt was also responsible for a widely celebrated multi-million-dollar renovation program at Watt Plaza, a 920,000 square foot, Class-A office building in Century City, Los Angeles, California. The building was certified Platinum LEED and was recognized by BOMA International with an award for Outstanding Building of the Year. Ms. Watt is a member of the University of Southern California Board of Governors and the Sol Price School of Public Policy Board of Councilors and serves on the Executive Committee of the Lusk Center for Real Estate as well as the USC Associates Board of Directors. She was the first woman to be named Chair of the Los Angeles Business Council, a position she still holds. She is a Board Member of Visionary Women and the City of Hope Los Angeles Real Estate & Construction Industries Council. Ms. Watt received the Century City Citizen of the Year award in 2017 and the EY Entrepreneur of the Year award in 2018. Ms. Watt is a 1990 graduate of Georgetown University School of Foreign Service, and received a Master of Arts degree from the School of Cinematic Arts at the University of Southern California in 1994. Robert Small has agreed to serve on our board of directors as of this offering. Mr. Small co-founded and built Miniclip SA into an international digital games and entertainment company, that develops, publishes and distributes multiplayer mobile games ( Miniclip ). Since its inception in 2001, Miniclip has become a top five mobile-games publisher on devices worldwide, which currently is generating over 3 billion downloads, 45 million daily active users, and 250 million monthly active users. In 2020, Mr. Small stepped into the role of President, after serving as Chief Executive Officer for nearly two decades. Mr. Small sits on the Miniclip Board of Directors. Miniclip games are played on six continents and in 195 countries around the world. 5 Table of Contents During his tenure at Miniclip, Mr. Small was awarded the Ernst & Young London Entrepreneur of the Year Award in 2008. Over the last decade, Miniclip became a prominent European mobile game company. In 2015, Miniclip was acquired by one of China s largest tech companies, Tencent. Mr. Small has a degree in Management from the University of Gloucestershire which he received in 1999. Jurgen Post has agreed to serve on our board of directors as of this offering. Mr. Post has more than 35 years of experience in Videogames and Entertainment Media. Mr. Post has served as Chief Executive Officer at Miniclip (UK) Ltd. (Miniclip) since 2020. Miniclip develops, publishes and distributes engaging games to an audience which currently is generating over 3 billion downloads, 45 million daily active users, and 250 million monthly active users. Miniclip games are played on six continents and in 195 countries around the world. From 2017 to 2020, Mr. Post served as President of International Partnerships at Tencent EMEA, one of the world s largest Videogames and Social Media platforms, where he led the acquisition or investment in 10+ Videogame studios. From April 2012 to June 2017 he was the President and Chief Operating Officer of Sega EMEA and from April 2010 to April 2012 he was Senior Vice President of Sega EMEA. Under Mr. Post s leadership, Sega EMEA grew from $50 million to $500 million USD of revenues. At Sega he also launched leading IPs such as Mario and Sonic at the Olympics and reinvigorated the Sonic the Hedgehog brand with over 50 million unit sales. At Sony Computer Entertainment, Mr. Post was part of the original team that launched PlayStation1 in EMEA. From November 2006 to April 2010, he was Managing Director of Sega EMEA and from January 2001 to October 2006 he was the General Manager for Sony/BMG s Benelux region. Mr. Post currently is a member of the board of Hiro Metaverse Acquisitions SPAC. He graduated with a Bachelor of Business Administration and a Bachelor of Logistical management from the University of Utrecht in 1991. Michael Krupin has agreed to serve on our board of directors as of this offering. Mr. Krupin has spent the last 40 years ranked among the top 1% of life insurance producers in the United States. He has handled cases worth well over $100 million and his clients include the nation s leading A-list individuals in entertainment, sports, business and healthcare. In 2012, Mr. Krupin formed Krupin Partners LLC to serve clients throughout the country from the firm s Beverly Hills, Richmond and New York offices. He has served as the managing partner of Krupin Partners LLC since its formation. In 1995, Mr. Krupin founded Gilbert-Krupin Insurance Services LLC, the successor to Krupin Associates, and served as its principal until 2012. Mr. Krupin graduated from Hampden-Sydney College in Hampden-Sydney, VA in 1969. Mr. Krupin is a highly sought speaker with an interest in fostering the next generation of insurance and estate planning professionals. He regularly leads discussions for the nation s top law firms, business managers and financial advisors on the nuances of utilizing life insurance for wealth management. Well-regarded in professional and community circles, Mr. Krupin s recognition and involvement includes: American Diabetes Association, Father of the Year, 2008 National Association of Financial Advisors (NAIFA), member National Association of Life Underwriters, National Quality Award, multiple years Chartered Life Underwriter (CLU), American College, 1975 International Association of Registered Financial Planners, 1987 Our Advisory Committee In addition to our management team and board of directors, we have assembled a group of experienced corporate and professional advisors to serve on our Advisory Committee to management and the board of directors. These executive advisors have been chosen for their extensive regional, sector and C-suite level experience in managing successful companies. In addition to providing us with strategic insights, which include in-depth knowledge of industry dynamics, competition and operational capabilities, our advisors will also provide access to their broad networks of operating executives and other resources. 6 Table of Contents Eddie Ahmed has agreed to serve on our advisory committee. Mr. Ahmed is the Chairman, President and CEO of MassMutual International LLC. Mr. Ahmed joined MassMutual Financial Group (MassMutual) in October 2015 as Chief Human Resources Officer. Mr. Ahmed brings with him an impressive history of more than 20 years of global financial services and leadership experience, ranging from HR to Operating roles. He joined MassMutual from Citigroup, Inc. in London where he was Managing Director and Head of Human Resources for Europe, Middle East and Africa as well as the Global Head of Recruitment for the firm. Previously, he led Global Shared Services in the Operations and Technology Division for all Citigroup employees. Prior to joining Citigroup in 2010, Mr. Ahmed began his career at Mitsubishi UFJ Financial Group, rotating through various roles including corporate finance, operations, credit and human resources. He then spent 17 years at Morgan Stanley in New York, Tokyo, Sydney and Hong Kong, during which time he held a range of roles including Chief Administrative Officer and Head of Human Resources, Asia. Mr. Ahmed is currently a Non-Executive Director on the Board of Yunfeng Financial, a HK-listed wealth manager, and of YF Life, its life insurance subsidiary. He is also a Non-Executive Director on the Board of Nippon Wealth Insurance in Japan, a subsidiary of Nippon Life. Additionally, he has served on the Advisory Board of NPX, Korea since Oct. 2019 and also on the Advisory Board of Essenlix Corp., US since Nov. 2020. Prior to the current board directorships. Mr. Ahmed also served on the boards of Temasek Management Services, Singapore between 2010-2018, Human Capital Leadership Institute in Singapore from 2017- 2019, and Bank Handlowy, Poland and Citibank Turkey, both between 2012-2015. Mr. Ahmed holds a BSc in Computer Science, a BA in International Relations, and an M.B.A., all from Tulane University in the US. Mr. Ahmed is an Australian citizen and a permanent resident of Hong Kong, where he is currently based. Jong-Dae Lee has agreed to serve on our advisory committee. Since leaving law practice in late 1990s, Mr. Lee has been an entrepreneur and investor in a range of companies with extensive experience in identifying, structuring and negotiating investment transactions in Asia and the United States. He has served on the board of directors of numerous publicly listed companies in Korea, the Philippines, United Kingdom and Hong Kong. He has also served as a board member in several privately owned companies throughout Asia. In 2015 Mr. Lee co-founded Carret Private Investments Limited, a Hong Kong based asset management firm licensed by HK Securities and Futures Commission under Types 1, 4 and 9. Carret currently has in excess of US$2 billion in assets under management. Mr. Lee is also a shareholder in Carret Asset Management Inc., which is a related New York based asset management company with over US$2.6 billion in assets under management. The core businesses of the Carret companies are wealth management and private principal investing. From 2012 to 2015, Mr. Lee was Managing Director of Quadrant Management Inc., a New York based direct investment firm with over US $3 billion under management. From 2007 to 2012, Mr. Lee held various positions, including, Chairman, CEO, Executive Director, Vice Chairman, Chief Compliance Officer at ERA Holdings Global Limited, which was listed on GEM board of the HK Stock Exchange. Also, during this same time period, Mr. Lee was Non-Executive Chairman of Asian Logic Inc., a pioneer in online gaming and software based in the Philippines, which went public in the UK AIM market in 2007. From 2003 to 2007, Mr. Lee was CEO and Executive Director of China Healthcare Holdings Limited, which was listed on the main board of the HK Stock Exchange. From 2000 through 2003, Mr. Lee was Senior Advisor and Executive Committee Member of Lee International IP and Law Group, one of the leading Korean law firms specializing in intellectual property and licensing. He was also Director of Business Development at Orrick Herrington and Sutcliffe, Hong Kong, a leading international law firm headquartered in San Francisco, California. From 2000 until 2001, Mr. Lee was with Citibank N.A. in Hong Kong as Director and Head of Regional Structured Transactions Group, Citibank, NA, Hong Kong. Prior to that from 1998 to 2000, he was Director of Investment Banking/Head of Korea at Rabobank International, Hong Kong. He was also Senior Advisor to Chairman of Tong Yang Group, Seoul, Korea, in connection with restructuring of the group s financial services businesses. From 1985 until 1997, Mr. Lee was a practicing lawyer. From 1988 to 1997, Mr. Lee was an Associate and then Partner with Coudert Brothers in Hong Kong and focused on advising clients in cross border transactions in Asia. From 1985 until 1988, he was an Associate at Oppenheimer Wolff and Donnelly, Washington, DC. 7 Table of Contents Mr. Lee holds a J.D. from Georgetown University Law Center, Washington, DC and Bachelor of Arts Degree from Haverford College, Haverford, Pennsylvania. Mr. Lee. has served on the Executive Committee of the Young Presidents Organization, both regionally in Asia and in Hong Kong Chapter, and was the Chairman of the Hong Kong Chapter in 2011 -2013 and have been an active member of the Beijing and Hong Kong Chapters of the Young Presidents Organization since 2004. Mr. Lee currently resides in Hong Kong. Dr. Won-Pyo Hong has agreed to serve on our advisory committee. Dr. Hong is currently President & Executive Advisor of Samsung SDS (ex-CEO), the largest IT solutions and services provider in Korea. Before joining Samsung SDS, Dr. Hong was President and Chief Marketing Officer (CMO) of Samsung Electronics, where he played a critical role in positioning Samsung as the world s premiere handset manufacturer and a globally valued brand. As an EVP and head of Global Product Strategy of the Mobile Communications Business Unit, Dr. Hong s introduction of the GALAXY franchise to Samsung s mobile portfolio propelled the brand to its status as the most popular and advanced line of Android smart devices. Dr. Hong also championed several key initiatives during his time as President and head of Samsung s Media Solutions Center, leading to critical new developments in IoT, multi-screen consumer experience, and cloud-based contents. As an industry visionary, Dr. Hong has been invited to give keynote speeches at prestigious events. Especially, at CES in 2016, he was an invited keynote speaker to present Samsung s innovations in IoT and consumer electronics. He also spoke at Boao Forum in 2018 and 2019 on the state of Blockchain and AI in the enterprise space. Prior to his career with Samsung, Dr. Hong worked at Bell Communications Research Inc. in New Jersey for seven years after earning his Ph.D. from the University of Michigan in 1988, and subsequently served multiple executive roles for thirteen years at Korea Telecom, which is the largest telecom service provider in Korea. His Alma Mater, the University of Michigan, recently recognized his accomplishments as an industry leader by awarding him the Impact Award in 2017 and Korean Michigan Alumni of the Year in 2016. In addition, he was awarded the Engineering Alumni of the Year from Seoul National University in 2013. He was also presented with the Order of Sport Merit, Geosang Medal, a national medal bestowed by the Korean government for his contributions in the success of the 2014 Incheon Asian Games during his tenure as the CMO of Samsung Electronics. Acquisition Strategy Overview We are a blank check company newly incorporated in Delaware created for the purpose of acquiring, purchasing all or substantially all of the assets of, or engaging in any other similar initial business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. We have not identified any potential business combination target and we have not, nor has anyone on our behalf, initiated any discussions, directly or indirectly, with any potential business combination target. We have conducted no operations and have generated no revenues, to date and we will not generate operating revenues until, at the earliest, after we consummate our initial business combination. Although we anticipate acquiring a target business that is an operating business, we are not obligated to do so and may determine instead to merge with or acquire a company with no operating history if the terms of the transaction are determined by us to be favorable to our public stockholders and the target business has a fair market value of at least 80% of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable, if any, on the income accrued on the trust account) at the time of the agreement to enter into the initial business combination. In such event, investors would not have the benefit of basing the decision on whether to remain with our company following such transaction on the past operations of such target business. Furthermore, in such a situation, many of the acquisition criteria and guidelines set forth in this prospectus may be rendered irrelevant. If we do not obtain a fairness opinion from an independent investment banking firm that is a member of the Financial Industry Regulatory Authority, or FINRA, or from an independent accounting firm, with respect to such criteria, the fair market value of such a target would be determined by our board of directors based upon one or more standards generally accepted by the financial community, such as actual and potential sales, earnings, cash flow and/or book value, discounted cash flow valuation or value of comparable businesses. We can provide no assurances that our management team s expertise will guarantee a successful initial business combination. 8 Table of Contents Business Strategy We will seek to capitalize on the significant investment, management, and transaction experience of our sponsor, founders, and management team who we believe are well positioned to identify and execute an attractive initial business combination. We believe that there are a substantial number of new and established growth companies in attractive and large addressable markets that are poised to disrupt their industries at scale and have a market-validated technology offering that is disruptive to their industry. Given our team s extensive experience as operators and investors in disruptive technologies, we believe our team is well-positioned to source and identify the next wave of companies for acquisition that are poised to take advantage of disruptive technologies in large addressable markets. Our acquisition strategy is to target those companies with significant growth potential and projected higher returns of invested capital over a long time period: Companies operating in substantial existing markets as opposed to those companies looking to develop a new market or sector for their products. Leveraging technology to disrupt their markets and to develop a sustainable competitive advantage in the marketplace, driving revenue, cost-reduction or increased capabilities for their customers. Established players in their respective space with a proven product-market fit, that have successfully gained a foothold in their respective markets and have the potential to become a scaled player. Our selection process will leverage our network of industry, private equity, and credit relationships, as well as relationships with management of public and private companies, investment bankers, restructuring advisers, attorneys and accountants, which we believe should provide us with a number of business combination opportunities that will benefit from our expertise. We intend to deploy a proactive, thematic sourcing strategy and to focus on companies where we believe the combination of our operating experience, relationships, capital, and capital markets expertise can be catalysts to transform and accelerate the target s growth and performance. Affiliated SPAC In March 2021, Abri Ventures I, Inc., an affiliate of our Sponsor, founded Abri SPAC I, Inc. ( Abri SPAC I ), a blank check company incorporated for the purposes of effecting a business combination. Abri SPAC I completed its initial public offering on August 12, 2021. On January 27, 2022, Abri SPAC I entered into a definitive merger agreement among Abri SPAC I, Abri Sub, Inc., a wholly-owned direct subsidiary of Abri SPAC I, ( Abri Merger Sub ), and Apifiny Group Inc. ( Apifiny ), a global cross exchange digital asset trading network (the Apifiny Merger Agreement ). Pursuant to the Apifiny Merger Agreement, upon the closing of the transactions contemplated thereby (the Apifiny Transactions ), Abri Merger Sub will merge with and into Apifiny, with Apifiny being the surviving corporation and becoming a wholly owned subsidiary of Abri SPAC I. Abri SPAC I will change its name to Apifiny Group Inc. Certain of our executive officers also serve as executive officers for Abri SPAC I. Our officers and directors may have conflicts of interest with other entities to which they owe fiduciary or contractual obligations with respect to initial business combination opportunities, including for our officers with respect to Abri SPAC I, which we refer to as the Affiliated SPAC . Other than with Abri SPAC I, none of our officers or directors, our sponsor, nor any of its respective officers, directors, employees, or affiliates, have had management experience with blank check companies or special purpose acquisition corporations in the past. In order to minimize potential conflicts of interest which may arise from multiple affiliations, our officers who are also officers of the Affiliated SPAC may be required to present all suitable target businesses to the Affiliated SPAC prior to presenting them to us in the event a business combination with Apifiny is not consummated, unless such opportunity is expressly offered to such individual solely in his capacity as an officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent such individual is permitted to refer that opportunity to us without violating another legal obligation. For a list of our officers and directors and entities for which a conflict of interest may or does exist between such officers or directors and the company, as well as the priority and preference that such entity has with respect to performance of obligations and presentation of business opportunities to us, please refer to the table and subsequent explanatory paragraph under Management Conflicts of Interest . Although conflicts of interest in pursuing an acquisition target may arise between the Affiliated SPAC and us if the business combination with Apifiny is not consummated, we do not believe that any potential conflicts would materially affect our ability to complete our initial business combination. 9 Table of Contents Competitive Strengths We believe that our networks and relationships from sourcing, evaluating, due diligence, and executing transactions and operating businesses will provide us with a significant pipeline of opportunities from which to evaluate and select a business that will benefit from our collective expertise. Our competitive strengths include the following: Management Operating and Investing Experience. Our management team and directors have significant experience in the financial services, clean technology, distribution and manufacturing industries. Our team has significant experience both investing in next generation data and technology platforms and, as operators, leveraging these assets to drive operational gains/efficiencies and new offerings. This positions us well to identify the right targets with scalable technologies and strong growth prospects that can convert their technology-enabled competitive advantages into monetizable opportunities and create stockholder value. Our management team will be led by Jeffrey Tirman, our Chairman, CEO and President; Nima Montazeri, our COO and board member; Christopher Hardt, our CFO and board member; Peter Bakker, our Vice President of Business Analytics; and Amy Wall our VP of Operations and Controller. Combined, they have more than 125 years of experience in executing complex corporate transactions across a variety of industries, coupled with extensive international senior corporate leadership roles. Mr. Tirman s expertise lies in corporate valuations, financial and operational turnarounds, corporate leadership management, and risk assessment and mitigation. He has led more than 10 turnaround and restructuring situations (both financial and operational), and has also analyzed, structured, negotiated and executed more than 100 corporate transactions. Mr. Montazeri, having executed investments in well over 100 mainly public companies, has extensive experience in financing and restructuring small to medium-sized public companies. We believe that Mr. Montazeri s sector expertise in the technology industry in particular will be a significant competitive advantage for our company. Mr. Hardt has served as a senior audit partner for nearly 20 years and has extensive public company accounting reporting experience, as well as extensive regulatory and compliance experience. We believe that Mr. Hardt s expertise is particularly relevant for our company. Mr. Bakker has extensive corporate valuation and credit analysis experience across a variety of industries, especially FinTech, and has spent the last decade focused on SME financing and risk management. Mrs. Wall has over 2 decades experience in financial accounting and controlling, as well as extensive operational and administration expertise. Strong Support Team. Our team is comprised of six individuals who have worked together for decades. All team members have either advanced accounting, financial and technical analysis or audit training, and/or extensive legal, corporate, operational and investment management experience, thereby enabling a highly focused approach to idea generation, analysis and transaction execution. Our team members also bring strong relationships with industry operators, consultants and investment bankers, expanding our network of valuable contacts and partners. We believe the well-roundedness of the team, strengthened by strong ties across industry, academia, banking and insurance, along with unaffiliated investor relationships, enhances our management team s ability to source viable prospective target businesses, properly capitalize them, and then ensure public-market readiness. We believe that our management team is equipped with the knowledge, experience, capital, human resource and sustainable corporate governance practices to pursue differentiated opportunities that will offer attractive risk-adjusted returns. In addition, we know first-hand the burden placed on the management teams of companies while they are simultaneously trying to advance their development and implementation programs and sell their vision to both investors and the board of directors. We are prepared to shoulder some of this burden upfront, ultimately allowing our business combination partner to focus on creating value. Established Deal Sourcing Network. As a result of our extensive global experience in financial and venture capital markets, we have developed a broad array of relationships across many industries, including our target industries. We believe that these relationships will provide us with a differentiated pipeline of acquisition opportunities and considerable deal flow. Optimal Size and Flexibility. We believe that the size of our SPAC provides us with a more attractive opportunity set as potential target companies will look to us as being a preferred SPAC partner. According to SPAC Track, the average SPAC IPO size over the last 2 years has been approximately $290 million. Given this, we believe that we possess a competitive advantage over a majority of SPACs for growth-oriented dilution-conscious target companies. 10 Table of Contents Business Combination Criteria We have identified the following general criteria for evaluation of potential business combination targets. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as on other considerations, factors, and criteria that our management may deem relevant. We will use these criteria in evaluating initial business combination opportunities, but we may decide to enter into our initial business combination with a target business that does not meet one or more of these criteria: Companies leveraging differentiated technology and innovative IP to disrupt a large total addressable market. We will seek technology-forward, IP driven companies looking to disrupt industries that have a large total addressable market. These industries are ripe for new entrants to take significant share from slower moving, non-digitally native incumbents. We will seek companies that can benefit from innovation to develop new products or services, enhance/expand go-to-market and sales capabilities, improvement of financial performance or growth through a business combination. Strong Management Team. We will seek to acquire one or more businesses or assets that have strong and experienced management teams whose interests are aligned with those of our stockholders and complement the expertise of our management team. Where necessary, we may also look to complement and enhance the capabilities of the target business s management team by recruiting additional talent through our network of contacts. We will focus on management teams that possess technical expertise, and those with a proven track record of driving revenue growth, enhancing profitability, and creating value for their stockholders. Ready to be Public. We will seek to identify companies that are public-ready with strong organizational structures, procedures, and processes in place. We will seek to partner with the potential target s management team and expect that the reporting, operating, and investment abilities of our management team and board will complement their own capabilities. We will also seek management teams that believe in, and practice, open and transparent reporting and corporate governance with a strong commitment to basic environmental, social and governance ( ESG ) principles. Recurring Revenue. We will seek to acquire one or more businesses or assets that have a history of, or potential for, strong, sustainable recurring and predictable revenue streams. Opportunities for Bolt-on Acquisitions. We will seek to acquire one or more businesses that can grow both organically and/or through acquisition. In addition, we believe that our ability to source opportunities and execute transactions will help the businesses we acquire grow through acquisition, and thus serve as a platform for further bolt-on acquisitions. Differentiated Industry Positioning. We will seek to acquire one or more businesses that have a leading or niche market position and that demonstrate advantages when compared to their competitors, if any, which may help to create barriers to entry against new competition. We anticipate that these barriers to entry will enhance the ability of these businesses to generate strong profitability and free cash flow. Diversified Customer and Supplier Base. We will seek to acquire one or more businesses that have a diversified customer and supplier base, which are generally better able to endure economic downturns, industry consolidation, changing business preferences and other factors that may negatively impact their customers, suppliers and competitors. Can Benefit from Access to Public Capital Markets. We believe that there are a substantial number of potential target businesses that can benefit from a public listing and access to new capital to support significant revenue and earnings growth or to facilitate technology development and deployment. Significant Expansion and/or Underexploited Growth Opportunities. We intend to seek target companies that have significant and underexploited expansion and deployment opportunities. This can be accomplished through a combination of accelerating organic growth and finding attractive bolt-on acquisition targets. Our management team has significant experience in identifying such targets and in helping target management assess strategic and financial fit, especially relating to ideological compatibility and process/procedure integration of any possible acquisition. 11 Table of Contents Unrecognized Value or Misevaluation by the Market. We will seek business combination targets which exhibit inherent value or other characteristics that we believe have been overlooked or misevaluated by the market based on our due diligence and company-specific analyses. For a potential business target, this process may include a review and analysis of the company s capital structure, quality of current or future earnings, an assessment of their current state of technology, current deployment and penetration plans, potential for operational improvements, corporate governance, customers and concentration, along with material contracts. We intend to leverage the operational experience and disciplined investment approach of our management team to identify opportunities to unlock value that our experience in complex transactions allows us to pursue. Attractive Risk-Adjusted Returns for our Stockholders. We intend to seek to acquire a business combination target on terms and in a manner that leverages our experience. We expect to evaluate the business combination target company based on its potential to successfully achieve deployment and end-user uptake of its product(s). We also expect to evaluate financial returns based on (i) risk-adjusted peak sales potential, (ii) the growth potential of pipeline products and the technology platform, (iii) the ability to accelerate growth via other options, including through the opportunity for bolt-on acquisitions, and (iv) prospects for creating value through other initiatives. Potential upside will be weighed against any identified downside risks. Our Business Combination Process In evaluating a prospective target business, we expect to conduct a thorough due diligence review that will encompass, among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities, as well as reviewing financial and other information that will be made available to us. We will also utilize our operational and capital allocation experience. Our acquisition criteria, due diligence processes and value creation methods are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our stockholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC. Sourcing of Potential Business Combination Targets We believe that the operational and transactional experience of our management team and members of our sponsor and their respective affiliates and related entities and the relationships they have developed as a result of such experience, will provide us with a substantial number of potential business combination targets. These individuals and entities have developed a broad network of contacts and corporate relationships around the world. This network has grown through sourcing, acquiring and financing businesses and maintaining relationships with sellers, financing sources and target management teams. Our management team and members of our sponsor and their respective affiliates and related entities have significant experience in executing transactions under varying economic and financial market conditions. We believe that these networks of relationships and this experience will provide us with important sources of investment opportunities. In addition, we anticipate that target business candidates may be brought to our attention from various unaffiliated sources, including investment market participants, private equity funds and large business enterprises seeking to divest noncore assets or divisions. We are not prohibited from pursuing an initial business combination with a business combination target that is affiliated with our sponsor, officers or directors (or their respective affiliates or related entities) or making the acquisition through a joint venture or other form of shared ownership with our sponsor, officers or directors (or their respective affiliates or related entities). In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors (or their respective affiliates or related entities), we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or an independent accounting firm that our initial business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other context. 12 Table of Contents Initial Business Combination We will have until 12 months from the closing of this offering to consummate an initial business combination. However, if we are not able to consummate our initial business combination within 12 months, we will be required to extend the period of time to consummate a business combination up to two times, each by an additional three months (for a total of up to 18 months to complete a business combination). Pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order to extend the time available for us to consummate our initial business combination, our sponsor or its affiliates or designees have the option to deposit into the trust account $1,000,000, or up to $1,150,000 if the underwriters over-allotment option is exercised in full ($0.10 per share in either case) on or prior to the date of the applicable deadline, for each three month extension (up to an aggregate of $2,000,000 (or up to $2,300,000 if the underwriters over-allotment option is exercised in full), or $0.20 per share, if we extend for the full six months). We will issue a press release announcing the extension at least three days prior to the applicable deadline. In addition, we will issue a press release the day after the applicable deadline announcing whether or not the funds had been timely deposited. Our sponsor and its affiliates or designees are obligated to fund the trust account to extend the time for us to complete our initial business combination. If we are unable to consummate our initial business combination within such time period, we will, as promptly as possible but not more than ten business days thereafter, redeem 100% of our outstanding public shares for a pro rata portion of the funds held in the trust account, including a pro rata portion of any interest earned on the funds held in the trust account and not previously released to us to pay our taxes, and then seek to dissolve and liquidate. However, we may not be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public stockholders. In the event of our dissolution and liquidation, the private units (and underlying securities) will be worthless. We will either (1) seek stockholder approval of our initial business combination at a meeting called for such purpose, at which stockholders may seek to redeem their shares, regardless of whether they vote for or against the proposed business combination, into their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable), or (2) provide our stockholders with the opportunity to sell their shares to us by means of a tender offer (and thereby avoid the need for a stockholder vote) for an amount equal to their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable), in each case subject to the limitations described herein. The decision as to whether we will seek stockholder approval of our proposed business combination or allow stockholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek stockholder approval. Any tender offer documents used in connection with a business combination will contain substantially the same financial and other information about the initial business combination as is required under the SEC s proxy rules. The initial per public share redemption price will be $10.10 per share, regardless of whether the over-allotment option is exercised. However, we may not be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public stockholders. Pursuant to the rules of the Nasdaq Stock Market, our initial business combination must occur with one or more target businesses having an aggregate fair market value of at least 80% of the value of the trust account (excluding any deferred underwriter s fees and taxes payable on the income earned on the trust account), which we refer to as the 80% test, at the time of the agreement to enter into the initial business combination. Therefore, the fair market value of the target business will be calculated prior to any redemptions of our shares in connection with a business combination and therefore will be a minimum of $80 million (or $92 million if the over-allotment option is exercised in full) in order to satisfy the 80% test. While the fair market value of the target business must satisfy the 80% test, the consideration we pay the owners of the target business may be a combination of cash (whether cash from the trust account or cash from a debt or equity financing transaction that closes concurrently with the business combination) or our equity securities. The exact nature and amount of consideration would be determined based on negotiations with the target business, although we will attempt to primarily use our equity as transaction consideration. If our board is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm with respect to the satisfaction of such criteria. We will also obtain a fairness opinion from an independent investment banking firm before consummating a business combination with an entity affiliated with any of our officers, directors or insiders. If we are no longer listed on Nasdaq, we will not be required to satisfy the 80% test. 13 Table of Contents We anticipate structuring our initial business combination so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders or for other reasons. However, we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the issued and outstanding capital stock, shares and/or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If our initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. If our securities are not listed on the Nasdaq after this offering, we would not be required to satisfy the 80% requirement. However, we intend to satisfy the 80% requirement even if our securities are not listed on the Nasdaq at the time of our initial business combination. Our sponsor, officers, directors, and their respective affiliates may participate in the formation of, or become an officer or director of, any other blank check company prior to completion of our initial business combination. In particular, certain of our executive officers and directors also serve as executive officers or directors of the Affiliated SPAC, which, if a business combination is not consummated with Apifiny, may have to revert to searching for businesses that may provide significant opportunities for attractive investor returns in industries similar to the industries in which our search is focused. As a result, our sponsor, officers or directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity, including the Affiliated SPAC if a business combination is not consummated with Apifiny. Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company, such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for one or more entities to which he or she has fiduciary, contractual or other obligations or duties, including the Affiliated SPAC if a business combination is not consummated with Apifiny, he or she will honor these obligations and duties to present such business combination opportunity to such entities first, and only present it to us if such entities reject the opportunity and he or she determines to present the opportunity to us. As more fully discussed in Management Conflicts of Interest, if any of our officers or directors becomes aware of a business combination opportunity that falls within the line of business of any entity to which he or she has pre-existing fiduciary or contractual obligations, he or she may be required to present such business combination opportunity to such entity prior to presenting such business combination opportunity to us. All of our officers, directors and director nominees currently have certain relevant pre-existing fiduciary duties or contractual obligations. 14 Table of Contents Private Placements In July 2021, our insiders purchased 2,875,000 insider shares for an aggregate purchase price of $25,000, or approximately $0.0087 per share. The per share purchase price of the insider shares was determined by dividing the amount of cash contributed to the company by the aggregate number of insider shares issued. The number of insider shares issued was determined based on the expectation that the insider shares would represent 20% of the outstanding shares after this offering (not including the securities underlying the private units). As such, our insiders will collectively own 20% of our issued and outstanding shares after this offering. The 2,875,000 insider shares held or controlled by our insiders include an aggregate of up to 375,000 shares subject to forfeiture to the extent that the underwriters over-allotment option is not exercised in full or in part, so that our insiders will collectively own or control 20% of our issued and outstanding shares after this offering. The insider shares are identical to the shares of common stock included in the units being sold in this offering. However, our insiders have agreed (A) to vote their insider shares and any public shares acquired in or after this offering in favor of any proposed business combination, (B) not to propose, or vote in favor of, an amendment to our certificate of incorporation that would affect the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if the period of time to consummate a business combination is extended, as described in more detail in this prospectus), (C) not to redeem any shares (including the insider shares) into their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable) in connection with a stockholder vote to approve our proposed initial business combination (or sell any shares they hold to us in a tender offer in connection with a proposed initial business combination) or a vote to amend the provisions of our certificate of incorporation relating to the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if the period of time to consummate a business combination is extended, as described in more detail in this prospectus), and (D) that the insider shares shall not be entitled to be redeemed for a pro rata portion of the funds held in the trust account if a business combination is not consummated. On the date of this prospectus, the insider shares will be placed into an escrow account maintained in New York, New York by Continental Stock Transfer & Trust Company, acting as escrow agent. Subject to certain limited exceptions, 50% of these shares will not be transferred, assigned, sold or released from escrow until the earlier of six months after the date of the consummation of our initial business combination or the date on which the closing price of our common stock equals or exceeds $12.50 per share (as adjusted for stock splits, stock dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after our initial business combination and the remaining 50% of the insider shares will not be transferred, assigned, sold or released from escrow until six months after the date of the consummation of our initial business combination, or earlier, in either case, if, subsequent to our initial business combination, we complete a liquidation, merger, stock exchange or other similar transaction which results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property. The limited exceptions referred to above include (1) transfers among the insiders to our officers, directors, advisors and employees, (2) transfers to an insider s affiliates or its members upon its liquidation, (3) transfers to relatives and trusts for estate planning purposes, (4) transfers by virtue of the laws of descent and distribution upon death, (5) transfers pursuant to a qualified domestic relations order, (6) private sales made at prices no greater than the price at which the securities were originally purchased or (7) transfers to us for cancellation in connection with the consummation of an initial business combination, in each case (except for clause 7) where the transferee agrees to the terms of the escrow agreement and forfeiture, as the case may be, as well as the other applicable restrictions and agreements of the holders of the insider shares. Our sponsor has committed to purchase from us an aggregate of 450,000 private units (or 495,000 private units if the over-allotment option is exercised in full) at a price of $10.00 per private unit ($4,500,000 in the aggregate, or $4,950,000 if the over-allotment option is exercised in full) in a private placement that will close simultaneously with the closing of this offering. We refer to these warrants throughout this prospectus as the private units . Each private unit is identical to the units sold in this offering, except as described in this prospectus. A portion of the proceeds from the private placement of the private units will be added to the proceeds of this offering and placed in a trust account in the United States, maintained by Continental Stock Transfer & Trust Company, as trustee. If we do not complete our initial business combination within 12 months, from the closing of this offering (or up to 18 months from the closing of this offering if the period of time to consummate a business 15 Table of Contents combination is extended, as described in more detail in this prospectus), the proceeds of the sale of the private units held in the trust account will be used to fund the redemption of our public shares and pay other expenses (subject to the requirements of applicable law) and the private units (and underlying securities) will be worthless. The private units will be identical to the public units being offered by this prospectus, except that (a) the private units and their component securities will not be transferrable, assignable or saleable until 30 days after the consummation of our initial business combination, except to permitted transferees as described herein under Principal Stockholders Transfers of Founder Shares and Private Units, and (b) the private warrants which, in part, comprise the private units are identical to the warrants, which in part, comprise the units sold in this offering, except that the private warrants will be exercisable for cash (even if a registration statement covering the shares of common stock issuable upon exercise of such warrants is not effective) or on a cashless basis, at the holder s option, and will not be redeemable by us, in each case so long as they are still held by the initial purchasers or their affiliates. If the private warrants are held by holders other than the sponsor or its permitted transferees, the private warrants will be redeemable by us and exercisable by the holders on the same basis as the warrants included in the units being sold in this offering. If public units or shares are purchased by any of our directors, officers or initial stockholders, they will be entitled to funds from the trust account to the same extent as any public stockholder upon our liquidation but will not have redemption rights related thereto. Corporate Information We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our shares of common stock that is held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our shares of common stock held by non-affiliates exceeds $250 million as of the end of the prior June 30, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our shares of common stock held by non-affiliates exceeds $700 million as of the prior June 30. Our executive offices are located at 9663 Santa Monica Blvd., No. 1091, Beverly Hills, CA 90210, and our telephone number is (424) 732-1021. Our website and the information contained on, or that can be accessed through, the website is not deemed to be incorporated by reference in, and is not considered part of, this prospectus. You should not rely on any such information in making your decision whether to invest in our securities. 16 Table of Contents The Offering In making your decision whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these, and the other risks set forth in the section below entitled Risk Factors beginning on page 36 of this prospectus. Securities offered 10,000,000 units, at $10.00 per unit, each unit consisting of one share of common stock, one redeemable warrant, and one right (each right entitles the holder thereof to receive one-tenth (1/10) of one share of common stock upon the consummation of a business combination). Each redeemable warrant entitles the holder thereof to purchase one share of common stock at a price of $11.50 per share. Proposed Nasdaq symbols Units: ASPPU Common Stock: ASPP Warrants: ASPPW Rights: ASPPR Trading commencement and separate trading of common stock, warrants and rights The units will begin trading on or promptly after the date of this prospectus. Each of the common stock, warrants and rights may trade separately on the 90th day after the date of this prospectus unless Chardan determines that an earlier date is acceptable (based upon, among other things, its assessment of the relative strengths of the securities markets and small capitalization companies in general, and the trading pattern of, and demand for, our securities in particular). In no event will Chardan allow separate trading of the common stock, warrants and rights until we file an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. Once the shares of common stock, warrants and rights commence separate trading, holders will have the option to continue to hold units or separate their units into the component pieces. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of common stock, warrants and rights. We will file a Current Report on Form 8-K with the U.S. Securities and Exchange Commission, or the SEC, including an audited balance sheet, promptly following the closing of this offering, which is anticipated to take place three business days from the date the units commence trading. The audited balance sheet will reflect our receipt of the proceeds from the exercise of the over-allotment option if the over-allotment option is exercised on the date of this prospectus. If the over-allotment option is exercised after the date of this prospectus, we will file an amendment to the Form 8-K or a new Form 8-K to provide updated financial information to reflect the exercise of the over-allotment option. We will also include in the Form 8-K, or amendment thereto, or in a subsequent Form 8-K, information indicating if Chardan has allowed separate trading of the common stock, warrants and rights prior to the 90th day after the date of this prospectus. 17 Table of Contents Units: Number outstanding before this offering None Number of private units to be sold in a private placement simultaneously with this offering 450,000 units(1) Number to be outstanding after this offering and the private placement 10,450,000 units(1)(5) Shares of common stock: Number outstanding before this offering 2,875,000 shares(2) Number to be sold in private placement 450,000 shares Number to be outstanding after this offering and the private placement 10,000,000 public shares, 450,000 private shares and 2,500,000 founder shares(1)(3)(5) Redeemable Warrants: Number outstanding before this offering None Number to be sold in private placement 450,000 warrants(1) Number to be outstanding after this offering and the private placement 10,000,000 public warrants and 450,000 private warrants(1)(4)(5) Rights Number outstanding before this offering None Number to be sold in private placement 450,000(1) Number to be outstanding after this offering and the private placement 10,000,000(5)(6) in public units and 450,000 in private units(5)(6) Terms of Warrants: Each redeemable warrant entitles the holder thereof to purchase one share of common stock at a price of $11.50 per full share, subject to adjustment as described in this prospectus. The warrants will become exercisable on the later of the completion of an initial business combination and one year from the consummation of this offering. The warrants will expire at 5:00 p.m., New York City time, on the fifth anniversary of our completion of an initial business combination, or earlier upon redemption. ____________ (1) Assumes the over-allotment option has not been exercised. (2) Consists solely of insider shares and includes an aggregate of up to 375,000 shares of common stock held by our insiders that are subject to forfeiture if the over-allotment option is not fully exercised by the underwriters. (3) If the over-allotment option is exercised in full, there will be a total of 11,500,000 public shares, 495,000 private shares underlying the private units and 2,875,000 founder shares. (4) If the over-allotment option is exercised in full, there will be a total of 11,500,000 public warrants outstanding, plus an aggregate of 495,000 private warrants underlying the private units. (5) Does not include securities underlying Chardan s unit purchase option. (6) If the over-allotment option is exercised in full, there will be a total of 11,500,000 rights in the public units, plus an aggregate of 495,000 rights in the private units. 18 Table of Contents No public warrants will be exercisable for cash unless we have an effective and current registration statement covering the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to such shares. It is our current intention to have an effective and current registration statement covering the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to such shares in effect promptly following consummation of an initial business combination. Notwithstanding the foregoing, if a registration statement covering the shares of common stock issuable upon exercise of the public warrants is not effective within 90 days following the consummation of our initial business combination, public warrant holders may, until such time as there is an effective registration statement and during any period when we shall have failed to maintain an effective registration statement, exercise warrants on a cashless basis pursuant to an available exemption from registration under the Securities Act. In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of common stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value shall mean the average reported last sale price of the shares of common stock for the 10 trading days ending on the day prior to the date of exercise. For example, if a holder held 150 warrants to purchase 150 shares and the fair market value on the date prior to exercise was $15.00, that holder would receive 35 shares without the payment of any additional cash consideration. If an exemption from registration is not available, holders will not be able to exercise their warrants on a cashless basis. Exercise price: $11.50 per share. If (x) we issue additional shares of common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.50 per share (with such issue price or effective issue price to be determined in good faith by our board of directors), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination, and (z) the volume weighted average trading price of our shares of common stock during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the Market Price ) is below $9.50 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the Market Price, and the $16.50 per share redemption trigger price described above will be adjusted (to the nearest cent) to be equal to 165% of the Market Price. 19 Table of Contents Redemption: We may redeem the outstanding warrants, in whole and not in part, at a price of $0.01 per warrant: at any time while the warrants are exercisable, upon a minimum of 30 days prior written notice of redemption, if, and only if, the last sales price of our shares of common stock equals or exceeds $16.50 per share for any 20 trading days within a 30 trading day period ending three business days before we send the notice of redemption, and if, and only if, there is a current registration statement in effect with respect to the shares of common stock underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption. If the foregoing conditions are satisfied and we issue a notice of redemption, each warrant holder can exercise his, her or its warrant prior to the scheduled redemption date. However, the price of the shares of common stock may fall below the $16.50 trigger price as well as the $11.50 warrant exercise price per share after the redemption notice is issued and not limit our ability to complete the redemption. The redemption criteria for our warrants have been established at a price which is intended to provide warrant holders a reasonable premium to the initial exercise price and provide a sufficient differential between the then-prevailing share price and the warrant exercise price so that if the share price declines as a result of our redemption call, the redemption will not cause the share price to drop below the exercise price of the warrants. If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In such event, each holder would pay the exercise price by surrendering the whole warrants for that number of shares of common stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value shall mean the average reported last sale price of the shares of common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Whether we will exercise our option to require all holders to exercise their warrants on a cashless basis will depend on a variety of factors including the price of our shares of common stock at the time the warrants are called for redemption, our cash needs at such time and concerns regarding dilutive share issuances. Accounting for the private warrants The private warrants included in the private units that are to be issued concurrently with this offering will be accounted for outside of stockholders equity and included in our financial statements as a current liability measured at the estimated fair value of the total private warrants. 20 Table of Contents In addition, at each reporting period (1) the accounting treatment of the warrants will be re-evaluated for proper accounting treatment as a liability or equity and (2) the fair value of the liability of the private warrants will be remeasured and the change in the fair value of the liability will be recorded as other income (expense) in our income statement. Rights Number outstanding before this offering 0 Number outstanding after this offering and private placement: 10,450,000(1)(5)(6) Terms of rights: Each holder of a right will automatically receive one-tenth (1/10) of one share of common stock upon consummation of our initial business combination. If we are unable to complete an initial business combination within the required time period and we liquidate the funds held in the trust account, holders of rights will not receive any of such funds for their rights and the rights will expire worthless. We will not issue fractional shares in connection with an exchange of rights. Fractional shares will either be rounded down to the nearest whole share or otherwise addressed in accordance with the applicable provisions of the Delaware General Corporations Law, and any rounding down and extinguishment may be done with or without any in lieu cash payment or other compensation being made to the holder of the relevant rights. As a result, you must hold rights in multiples of 10 in order to receive shares for all of your rights upon closing of a business combination. Offering proceeds to be held in trust $101,000,000 of the net proceeds of this offering and a portion of the private placement (or $ 116,150,000 if the over-allotment option is exercised in full), or $10.10 per unit sold to the public in this offering (regardless of whether or not the over-allotment option is exercised in full or part) will be deposited into a segregated trust account located in the United States with Continental Stock Transfer & Trust Company, acting as trustee, pursuant to an agreement to be signed on the date of this prospectus. The proceeds to be placed in the trust account shall also include $3,500,000 (or up to $4,025,000 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions, which will be released to the underwriters only upon consummation of an initial business combination, as described in this prospectus. Of the $4,500,000 we will receive from the sale of the private units ($4,950,000 if the over-allotment option is exercised), $2,500,000 will be used for offering expenses, including $2,000,000 in underwriters commissions paid at closing, $1,000,000 to be held in the trust account, and $1,000,000 will be used for working capital (or $2,800,000 will be used for offering expenses, including $2,300,000 in underwriters commissions paid at closing, $1,150,000 to be held in the trust account, and $1,000,000 will be used for working capital if the over-allotment option is exercised in full). The $1,000,000 of working capital will not be held in the trust account. 21 Table of Contents Except as set forth below, the proceeds in the trust account will not be released until the earlier of: (1) the completion of an initial business combination within the required time period and (2) our redemption of 100% of the outstanding public shares if we have not completed a business combination in the required time period. Therefore, unless and until our initial business combination is consummated, the proceeds held in the trust account will not be available for our use for any expenses related to this offering or expenses which we may incur related to the investigation and selection of a target business and the negotiation of an agreement to acquire a target business. Notwithstanding the foregoing, there can be released to us from the trust account any interest earned on the funds in the trust account that we need to pay our income or other tax obligations. With this exception, expenses incurred by us may be paid prior to a business combination only from the net proceeds of this offering, after payment of underwriters commissions and offering expenses, not held in the trust account of approximately $1,000,000. Additionally, in order to meet our working capital needs following the consummation of this offering if the funds not held in the trust account are insufficient, our initial stockholders, officers and directors or their affiliates may, but are not obligated to, loan us funds, from time to time or at any time, in whatever amount they deem reasonable in their sole discretion. Each loan would be evidenced by a promissory note. The notes would either be paid upon consummation of our initial business combination, without interest, or, at the relevant insider s discretion, up to $1,500,000 of the notes may be converted upon consummation of our business combination into additional units at a price of $10.00 per unit. These units would be identical to the private units. If we do not complete a business combination, the loans will only be repaid with funds not held in the trust account, to the extent available. Insider shares On July 19, 2021, our sponsor purchased 2,875,000 insider shares for an aggregate purchase price of $25,000, or approximately $0.0087 per share. Prior to the initial investment in the company of $25,000 by our sponsor, the company had no assets, tangible or intangible. The per share purchase price of the insider shares was determined by dividing the amount of cash contributed to us by the aggregate number of insider shares issued. The number of insider shares issued was determined based on the expectation that the insider shares would represent 20% of the outstanding shares after this offering (not including the securities underlying the private units). The 2,875,000 insider shares held or controlled by our insiders include an aggregate of up to 375,000 shares subject to forfeiture to the extent that the underwriters over-allotment option is not exercised in full or in part. Our insiders will collectively beneficially own approximately 20% of our issued and outstanding shares after this offering (not including the private units and underlying securities and assuming our insiders do not purchase any public units in this offering). If we increase or decrease the size of the offering pursuant to Rule 462(b) under the Securities Act, we will effect a stock dividend or share contribution back to capital, as applicable, immediately prior to the consummation of the offering in such amount as to maintain the ownership of insider shares by our insiders at 20% of our outstanding shares of common stock after this offering. 22 Table of Contents The insider shares are identical to the shares of common stock included in the units being sold in this offering, except that: the insider shares are subject to certain transfer restrictions, as described in more detail below; our insiders have entered into letter agreements with us, pursuant to which they have agreed (i) to waive their redemption rights with respect to their insider shares and any public shares they purchase in connection with the completion of our initial business combination and (ii) to waive their redemption rights with respect to their insider shares if we fail to complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if the period of time to consummate a business combination is extended, as described in more detail in this prospectus) (although they will be entitled to redemption rights with respect to any public shares they hold if we fail to complete our business combination within the prescribed time frame); if we submit our initial business combination to our public stockholders for a vote, our insiders have agreed to vote their insider shares and any public shares purchased during or after this offering in favor of our initial business combination; and the insider shares are subject to registration rights. Transfer restrictions on insider shares Our insiders have agreed not to transfer, assign or sell any of the insider shares (except to certain permitted transferees) until, with respect to 50% of the insider shares, the earlier of six months after the date of the consummation of our initial business combination or the date on which the closing price of our common stock equals or exceeds $12.50 per share for any 20 trading days within a 30-trading day period following the consummation of our initial business combination and, with respect to the remaining 50% of the insider shares, six months after the date of the consummation of our initial business combination, or earlier in each case if, subsequent to our initial business combination, we complete a liquidation, merger, stock exchange or other similar transaction which results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property. The insider shares will be held in escrow with Continental Stock Transfer & Trust Company during the period in which they are subject to the transfer restrictions described above. Private units Our sponsor has committed to purchase from us an aggregate of 450,000 private units (or 495,000 if the over-allotment option is exercised in full) at a price of $10.00 per private unit ($4,500,000 in the aggregate, or $4,950,000 if the over-allotment option is exercised in full) in a private placement that will close simultaneously with the closing of this offering. Each private unit will be comprised of one share of common stock, one redeemable warrant and one right, each right to receive one-tenth (1/10) of one share of common stock upon consummation of our initial business combination. Each private unit is identical to the units offered by this prospectus except as described below. 23 Table of Contents All of the proceeds we receive from this private placement of units will be added to the proceeds from this offering to pay for the expenses of this offering and to be held in the trust account. If we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if the period of time to consummate a business combination is extended, as described in more detail in this prospectus), the proceeds of the sale of the private units will be used to fund the redemption of our public shares (subject to the requirements of applicable law) and the private units (and underlying securities) will be worthless. Our sponsor has agreed to waive its redemption rights with respect to any shares underlying the private units (i) in connection with the consummation of a business combination, (ii) in connection with a stockholder vote to amend our amended and restated certificate of incorporation to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or certain amendments to our charter prior thereto, to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the completion of this offering (or up to 18 months from the closing of this offering if the period of time to consummate a business combination is extended, as described in more detail in this prospectus) or with respect to any other provision relating to stockholders rights or pre-initial business combination activity and (iii) if we fail to consummate a business combination within 12 months from the completion of this offering (or up to 18 months from the closing of this offering if the period of time to consummate a business combination is extended, as described in more detail in this prospectus) or if we liquidate prior to the expiration of the 18 month period. However, our sponsor will be entitled to redemption rights with respect to any public shares it holds if we fail to consummate a business combination or liquidate within the 18-month period. Transfer restrictions on private units The private units and their component securities will not be transferable, assignable or saleable until 30 days after the consummation of our initial business combination except to permitted transferees. Limited payments to insiders There will be no fees, reimbursements or other cash payments paid to our insiders or any of the members of our management team prior to, or for any services they render in order to effectuate, the consummation of our initial business combination (regardless of the type of transaction that it is) other than: repayment at the closing of this offering of non-interest bearing loans up to an aggregate amount of $300,000; payment of $10,000 per month to our sponsor for office space and related services, subject to deferral as described herein; reimbursement of out-of-pocket expenses incurred by our insiders or any of their affiliates in connection with certain activities on our behalf, such as identifying and investigating possible business targets and business combinations; and 24 Table of Contents repayment of loans which may be made by our insiders or any of their affiliates to finance transaction costs in connection with an initial business combination, the terms of which have not been determined. There is no limit on the amount of out-of-pocket expenses reimbursable by us; provided, however, that to the extent such expenses exceed the available proceeds not deposited in the trust account, such expenses would not be reimbursed by us unless we consummate an initial business combination. We have no policy which prohibits our insiders or any member of our management team from negotiating the reimbursement of such expenses by a target business. Our audit committee will review and approve all reimbursements and payments made to any insider or member of our management team, or our or their respective affiliates, and any reimbursements and payments made to members of our audit committee will be reviewed and approved by our board of directors, with any interested director abstaining from such review and approval. Potential revisions to agreements with insiders We could seek to amend certain agreements made by our management team disclosed in this prospectus without the approval of stockholders, although we have no intention to do so. For example, restrictions on our executives relating to the voting of securities owned by them, the agreement of our management team to remain with us until the closing of a business combination, the obligation of our management team to not propose certain changes to our organizational documents or the obligation of the management team and its affiliates to not receive any compensation in connection with a business combination could be modified without obtaining stockholder approval. Although stockholders would not be given the opportunity to redeem their shares in connection with such changes, in no event would we be able to modify the redemption or liquidation rights of our stockholders without permitting our stockholders the right to redeem their shares in connection with any such change. We will not agree to any such changes unless we believed that such changes were in the best interests of our stockholders (for example, if such a modification were necessary to complete a business combination). Conflict of Interest Our sponsor is affiliated to the sponsor of the Affiliated SPAC. Our sponsor, officers, directors, and their respective affiliates, may become an officer or director in any other blank check company prior to completion of our initial business combination. In particular, certain of our executive officers and directors also serve as executive officers or directors of the Affiliated SPAC, which, if a business combination is not consummated with Apifiny, could revert to searching for businesses that may provide significant opportunities for attractive investor returns in industries similar to the industries in which our search is focused. As a result, our sponsor, officers or directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. 25 Table of Contents As described herein, each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities, including the Affiliated SPAC if a business combination is not consummated with Apifiny. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for one or more entities to which he or she has fiduciary, contractual or other obligations or duties, including the Affiliated SPAC if a business combination is not consummated with Apifiny, he or she will honor these obligations and duties to present such business combination opportunity to such entities first, and only present it to us if such entities reject the opportunity and he or she determines to present the opportunity to us (including as described above). These conflicts may not be resolved in our favor and a potential target business may be presented to another entity prior to its presentation to us. The potential conflicts described above may limit our ability to enter into a business combination or other transactions. These circumstances could give rise to numerous situations where interests may conflict. There can be no assurance that these or other conflicts of interest with the potential for adverse effects on the Company and investors will not arise. Stockholder approval of, or tender offer in connection with, initial business combination In connection with any proposed initial business combination, we will either (1) seek stockholder approval of such initial business combination at a meeting called for such purpose at which stockholders may seek to redeem their shares into their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable), regardless of whether they vote for or against the proposed business combination; or (2) provide our stockholders with the opportunity to sell their shares to us by means of a tender offer (and thereby avoid the need for a stockholder vote) for an amount equal to their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable), in each case subject to the limitations described herein. The decision as to whether we will seek stockholder approval of our proposed business combination or allow stockholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek stockholder approval. If we provide stockholders with the opportunity to sell their shares to us by means of a tender offer, we will file tender offer documents with the SEC which will contain substantially the same financial and other information about the initial business combination as is required under the SEC s proxy rules. If we seek stockholder approval of our initial business combination, we will consummate the business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the business combination. 26 Table of Contents In addition, we will not consummate our initial business combination if public stockholders exercise redemption rights in an amount that would cause our net tangible assets to be less than $5,000,001 (so that this offering is not subject to Rule 419 promulgated under the Securities Act) or if we do not satisfy any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. For example, the proposed business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration needed to satisfy cash conditions pursuant to the terms of the proposed business combination exceeds the aggregate amount of cash available to us (including any cash we may obtain from financing from third parties or our insiders or their affiliates, which may not be available on terms acceptable to us or at all), we will not complete the business combination (as we may be required to have a lesser number of shares redeemed). As a result, we may not be able to locate another suitable target within the applicable time period, if at all. However, if we seek stockholder approval of a business combination and if a significant number of public stockholders properly seek to redeem their public shares in connection with a proposed business combination, we or our insiders or their affiliates could purchase some or all of such shares in the open market or in private transactions in order to seek to satisfy the cash conditions. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. No funds from the trust account can be released from the trust account prior to the consummation of a business combination to make such purchases (although such purchases could be made using funds available to us after the closing of a business combination). We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Notwithstanding the foregoing, we or our insiders and their affiliates will not make purchases of shares of common stock if the purchases would violate Sections 9(a)(2) or 10(b) of the Exchange Act or Regulation M, which are rules that prohibit manipulation of a company s stock, and we and they will comply with Rule 10b-18 under the Exchange Act in connection with any open-market purchases. If purchases cannot be made without violating applicable law, no such purchases will be made. 27 Table of Contents Our insiders have agreed (A) to vote their insider shares and any public shares acquired in or after this offering in favor of any proposed business combination, (B) not to propose, or vote in favor of, an amendment to our certificate of incorporation that would affect the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if the period of time to consummate a business combination is extended, as described in more detail in this prospectus), (C) not to redeem any shares (including the insider shares) into their pro rata share of the aggregate amount then on deposit in the trust account in connection with a stockholder vote to approve our proposed initial business combination (or sell any shares they hold to us in a tender offer in connection with a proposed initial business combination) or a vote to amend the provisions of our certificate of incorporation relating to the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if the period of time to consummate a business combination is extended, as described in more detail in this prospectus), and (D) that the insider shares shall not be entitled to be redeemed for a pro rata portion of the funds held in the trust account if a business combination is not consummated. Depending on how a business combination was structured, any stockholder approval requirement could be satisfied by obtaining the approval of either (i) a majority of the shares of our common stock that were voted at the meeting (assuming a quorum was present at the meeting), or (ii) a majority of the outstanding shares of our common stock. Because our insiders will collectively beneficially own approximately 20% of our issued and outstanding shares of common stock (not including the private units and underlying securities and assuming our insiders do not purchase any units in this offering) upon consummation of this offering, a minimum of approximately 287,501 public shares, or approximately 2.88% of the outstanding public shares of our common stock (if the approval requirement was a majority of shares voted and assuming that only a quorum (i.e., the majority of shares issued and outstanding and entitled to vote was present) at the meeting, that the over-allotment option is not exercised, and that the insiders do not purchase any units in this offering or units or shares in the after-market), would need to be voted in favor of a business combination in order for it to be approved. None of our insiders, director nominees or their affiliates has committed to purchase units in this offering or any units or shares of common stock in the open market or in private transactions. However, if a significant number of stockholders vote, or indicate an intention to vote, against a proposed business combination, our insiders or their affiliates could make such purchases in the open market or in private transactions in order to influence the vote. Notwithstanding the foregoing, our insiders and their affiliates will not make purchases of shares of common stock if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. 28 Table of Contents Conditions to completing our initial business combination There is no limitation on our ability to raise funds privately or through loans in connection with our initial business combination. Our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the value of the trust account (excluding any deferred underwriter s fees and taxes payable on the income earned on the trust account) at the time of the agreement to enter into the initial business combination. If we are no longer listed on Nasdaq, we will not be required to satisfy the 80% test. If our board is not able to independently determine the fair market value of the target business or businesses, we may obtain an opinion from an independent investment banking or accounting firm as to the fair market value of the target business. We will complete our initial business combination only if the post-transaction company in which our public stockholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns 50% or more of the voting securities of the target, our stockholders prior to the business combination may collectively own a minority interest in the post business combination company, depending on valuations ascribed to the target and us in the business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% test, provided that in the event that the business combination involves more than one target business, the 80% test will be based on the aggregate value of all of the target businesses. Redemption rights In connection with any stockholder meeting called to approve a proposed initial business combination, each public stockholder will have the right, regardless of whether he, she or it is voting for or against such proposed business combination, to demand that we redeem his, her or its public shares into a pro rata share of the trust account upon consummation of the business combination. We may require public stockholders wishing to exercise redemption rights, whether they are a record holder or hold their shares in street name, to either tender the certificates they are seeking to redeem to our transfer agent or to deliver the shares they are seeking to redeem to the transfer agent electronically using Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option, at any time at or prior to the vote on the business combination. There is a nominal cost associated with this tendering process and the act of certificating the shares or delivering them through the DWAC System. The transfer agent will typically charge the tendering broker $45 and it would be up to the broker whether or not to pass this cost on to the redeeming holder. However, this fee would be incurred regardless of whether or not we require holders to deliver their shares prior to the vote on the business combination in order to exercise redemption rights. This is because a holder would need to deliver shares to exercise redemption rights regardless of the timing of when such delivery must be effectuated. However, in the event we require stockholders to deliver their shares prior to the vote on the proposed business combination and the proposed business combination is not consummated, this may result in an increased cost to stockholders. 29 Table of Contents Under Delaware law, we may be required to give a minimum of only ten days notice for each general meeting. As a result, if we require public stockholders who wish to redeem their shares of common stock into the right to receive a pro rata portion of the funds in the trust account to comply with the foregoing delivery requirements, holders may not have sufficient time to receive the notice and deliver their shares for redemption. Accordingly, investors may not be able to exercise their redemption rights and may be forced to retain our securities when they otherwise would not want to. If we require public stockholders who wish to redeem their shares of common stock to comply with specific delivery requirements for redemption described above and such proposed business combination is not consummated, we will promptly return such certificates to the tendering public stockholders. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, all amounts held in the trust account will be released to us. We will use these funds to pay amounts due to any public stockholders who exercise their redemption rights as described above under Redemption rights, to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or targets or owners of the target or targets of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using stock or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Extension of time to complete business combination We will have until 12 months from the closing of this offering to consummate an initial business combination. However, if we are not able to consummate our initial business combination within 12 months, we will be required to extend the period of time to consummate a business combination up to two times, each by an additional three months (for a total of up to 18 months to complete a business combination). Pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order to extend the time available for us to consummate our initial business combination, our sponsor or its affiliates or designees, have the option to deposit into the trust account $1,000,000, or up to $1,150,000 if the underwriters over-allotment option is exercised in full ($0.10 per share in either case) on or prior to the date of the applicable deadline, for each three month extension (up to an aggregate of $2,000,000 (or up to $2,300,000 if the underwriters over-allotment option is exercised in full), or $0.20 per share, if we extend for the full six months). Such payments would be made in the form of a loan. Any such loans will be non-interest bearing and payable upon the consummation of our initial business combination. If we complete our initial business combination, we would repay such 30 Table of Contents loaned amounts out of the proceeds of the trust account released to us. If we do not complete a business combination, we will not repay such loans. Furthermore, the letter agreement with our initial stockholders contains a provision pursuant to which our sponsor has agreed to waive its right to be repaid for such loans out of the funds held in the trust account in the event that we do not complete a business combination. Our sponsor and its affiliates or designees are obligated to fund the trust account to extend the time for us to complete our initial business combination pursuant to the terms of the letter agreement. Liquidation if no business combination If we are unable to complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if the period of time to consummate a business combination is extended, as described in more detail in this prospectus), we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem 100% of the outstanding public shares for a pro rata portion of the funds held in the trust account, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining holders of common stock and our board of directors, dissolve and liquidate, subject (in the case of (ii) and (iii) above) to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. In connection with our redemption of 100% of our outstanding public shares, each holder will receive an amount equal to (1) the number of public shares being redeemed by such public holder divided by the total number of public shares multiplied by (2) the amount then in the trust account (initially $10.10 per share), which includes the deferred underwriting commission, plus a pro rata portion of any interest earned on the funds held in the trust account and not previously released to us or necessary to pay our taxes (subject in each case to our obligations under Delaware law to provide for claims of creditors). The proceeds deposited in the trust account could, however, become subject to claims of our creditors that are in preference to the claims of our stockholders. We may not have funds sufficient to pay or provide for all creditors claims. Although we will seek to have all vendors, service providers (excluding our independent registered public accounting firm), prospective target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our public stockholders, there is no guarantee that they will execute such agreements or even if they execute such agreements that they would be prevented from bringing claims against the trust account including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain an advantage with respect to a claim against our assets, 31 Table of Contents including the funds held in the trust account. If any third-party refuses to execute an agreement waiving such claims to the monies held in the trust account, our management will perform an analysis of the alternatives available to it and will only enter into an agreement with a third-party that has not executed a waiver if management believes that such third-party s engagement would be significantly more beneficial to us than any alternative. Examples of possible instances where we may engage a third-party that refuses to execute a waiver include the engagement of a third-party consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver. The underwriters will not execute agreements with us waiving such claims to the monies held in the trust account. In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason. In order to protect the amounts held in the trust account, our sponsor has agreed that it will be liable to us if and to the extent any claims by a vendor for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amounts in the trust account to below the lesser of (i) $10.10 per public share and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account if less than $10.10 per share due to reductions in the value of the trust assets, in each case less taxes payable, provided that such liability will not apply to any claims by a third-party who executed a waiver of any and all rights to seek access to the trust account nor will it apply to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. In the event that an executed waiver is deemed to be unenforceable against a third-party, our sponsor will not be responsible to the extent of any liability for such third-party claims. However, we have not asked our sponsor to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and we believe that our sponsor s only assets are securities of our company. Therefore, we cannot assure you that our sponsor would be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties, including, without limitation, claims by vendors and prospective target businesses. In the event that the proceeds in the trust account are reduced below the lesser of (i) $10.10 per public share and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account if less than $10.10 per share due to reductions in the value of the trust assets, in each case less taxes payable, and our sponsor asserts that it is unable to satisfy its indemnification obligations or that it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take legal action against our sponsor to enforce its indemnification obligations. While we currently expect that our independent directors would take legal action 32 Table of Contents on our behalf against our sponsor to enforce its indemnification obligations to us, it is possible that our independent directors in exercising their business judgment may choose not to do so in any particular instance. Accordingly, we cannot assure you that due to claims of creditors the actual value of the per-share redemption price will not be less than $10.10 per share. If we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our stockholders. To the extent any bankruptcy claims deplete the trust account, we cannot assure you we will be able to return $10.10 per share to our public stockholders. Additionally, if we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a preferential transfer or a fraudulent conveyance. As a result, a bankruptcy court could seek to recover some or all amounts received by our stockholders. Furthermore, our board of directors may be viewed as having breached its fiduciary duty to our creditors and/or may have acted in bad faith, thereby exposing itself and our company to claims of punitive damages, by paying public stockholders from the trust account prior to addressing the claims of creditors. We cannot assure you that claims will not be brought against us for these reasons. The holders of the insider shares and private units (and underlying securities) will not participate in any redemption distribution with respect to their insider shares and private units (and underlying securities) but may have any public shares redeemed upon liquidation. If we are unable to conclude our initial business combination and we expend all of the net proceeds of this offering not deposited in the trust account, without taking into account any interest earned on the trust account, we expect that the initial per-share redemption price will be approximately $10.10. We will pay the costs of any liquidation following the redemptions from our remaining assets outside of the trust account. If such funds are insufficient, our insiders have agreed to pay the funds necessary to complete such liquidation (currently anticipated to be no more than approximately $15,000) and have agreed not to seek repayment for such expenses. The underwriters have agreed to waive their rights to the deferred underwriting commissions held in the trust account in the event we do not consummate a business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if the period of time to consummate a business combination is extended, as described in more detail in this prospectus). 33 Table of Contents Risks We are a newly formed company that has conducted no operations and has generated no revenues. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision on whether to invest in our securities, you should take into account not only the background of our management team, but also the special risks we face as a blank check company, as well as the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act, and, therefore, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see Proposed Business Comparison to Offerings of Blank Check Companies Subject to Rule 419. You should carefully consider these and the other risks set forth in the section entitled Risk Factors beginning on page 36 of this prospectus. A brief summary of some of the risk factors that make an investment in us speculative or risky include: Whether we will be able to complete our initial business combination, particularly in light of disruption that may result from limitations imposed by the COVID-19 pandemic; Whether we will be successful in retaining or recruiting, or making changes required in, our officers, key employees or directors following our initial business combination; How much time our officers and directors allocate to us and potentially having conflicts of interest with our business or in approving our initial business combination, as a result of which they would then receive expense reimbursements and other benefits; Whether we will need to obtain additional financing to complete our initial business combination; Whether there is a sufficient pool of prospective target businesses for us to acquire, given competition; Whether our officers and directors are able to generate a number of potential investment opportunities; Whether our securities are delisted from Nasdaq prior to our business combination or an inability to have our securities listed on Nasdaq following a business combination; The fact that we may have limited liquidity in our securities; The fact that there has not previously been a market for our securities; We have identified a material weakness in our internal control over financial reporting and may identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls, which may result in material misstatements of our consolidated financial statements or cause us to fail to meet our periodic reporting obligations; and Our financial performance following our business combination. 34 Table of Contents
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+Prospectus Summary 1
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+PROSPECTUS SUMMARY 1
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001912331_elektor_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001912331_elektor_prospectus_summary.txt
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@@ -0,0 +1,9 @@
+PROSPECTUS SUMMARY
+ 
+ We are a development stage company and were incorporated in Wyoming on July 16, 2021. Our business objective is to supply sustainable, reliable solar water pumps for customers that need a secure and clean water supply for agricultural and domestic water purposes. Our financial statements as at March 31, 2022, report no revenues and net loss of $ 40,098. To implement our plan of operations we require a minimum funding of $80,000 for the next twelve months. As of the date of this Prospectus we have a cash balance of $ 2,988. Our independent auditor has issued an audit opinion for our Company, which includes a statement expressing a doubt as to our ability to continue as a going concern.
+ 
+ As used in this prospectus, references to the Company, we, our , us or Elektor refer to Elektor Industries Inc. unless the context otherwise indicates.
+ 
+ As of the date of this prospectus, there is no public trading market for our common stock and no assurance that a trading market for our securities will ever develop or if developed it will be sustained.
+ 
+ The following summary highlights selected information contained in this prospectus. Before making an investment decision, you should read the entire prospectus carefully, including the
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001912954_widfit-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001912954_widfit-inc_prospectus_summary.txt
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+PROSPECTUS SUMMARY As used in this prospectus, references to the "Company", "we", "our", "us", "WidFit" refer to WidFit Inc., unless the context otherwise indicates. The following summary highlights selected information contained in this prospectus. Before making an investment decision, you should read the entire prospectus carefully, including the "Risk Factors" section, the financial statements, and the notes to the financial statements. OUR COMPANY Corporate Background and Business Overview WidFit Inc. is a company in its early stages of development. We were incorporated under the laws of the state of Nevada on December 13, 2021. We are not a blank check registrant as that term is defined in Rule 419(a)(2) of Regulation C of the Securities Act, since we have a specific business plan or purpose. We have not had preliminary contact or discussions with, nor do we have any present plans, proposals, arrangements or understandings with, any representatives of the owners of any business or company regarding the possibility of an acquisition or merger. We plan to develop an Internet browser that lets you choose how your data is used online. We are designing our browser to let you keep your personal data private or be rewarded. A user of our browser will allow you to choose from the following two options: (i) privacy mode, which will be designed to protect your personal browsing date, and (ii) advertising mode, through which a user earns points, which can be redeemed for cash, products, vouchers or be donated. Our business is based on our subjective belief that the advertising industry uses the browsing data of a person using an Internet browser, tracking a user s online browsing history and habits to understand a user s behavior and purchasing habits. We further believe that an Internet user s collected browsing information is sold, but we at WidFit believe that people should have a choice to stop this from happening or even better to earn from it themselves. Our website is currently in the development stage. We expect our website to be operational within 6 months following successful completion of this offering, and the funding needed to reach this level of functionality is $10,000. There can be no assurances that our efforts to develop our proposed Internet browser will succeed or that we will be able to successfully market and generate revenues from our proposed Internet browser, if developed. We have not written any source or object code for our Internet browser. We anticipate that we will not have a commercial product available for at least 6 months from the date hereof, assuming successful completion of this offering and the successful raise of additional financing of $30,000 for browser development, initial marketing and promotion for commercial launch. If we are successful in completing and launching our Internet browser, we anticipate that we will generate nominal revenues within 7 to 12 months following the Internet browser launch. Because we are a shell company, the Rule 144 safe harbor is not available for the resale of any restricted securities issued by us in any subsequent unregistered offering. This will likely make it more difficult for us to attract additional capital through subsequent unregistered offerings because purchasers of securities in such unregistered offerings will not be able to resell their securities in reliance on Rule 144, a safe harbor on which holders of restricted securities usually rely to resell securities. Our fiscal year end is December 31, and we have no subsidiaries. Our business offices are currently located at Jabotinsky Street 3, Hod Hasharon 4530803, Israel. Certain Information about this Offering Offering Price Per Share Commissions Proceeds to Company Before Expenses if 10% of the shares are sold Proceeds to Company Before Expenses if 50% of the shares are sold Proceeds to Company Before Expenses if 100% of the shares are sold Common Stock $0.02 Not Applicable $6,000 $30,000 $60,000 Totals $0.02 Not Applicable $6,000 $30,000 $60,000 There has been no market for our securities and a public market may never develop, or, if any market does develop, it may not be sustained. Our common stock is not traded on any exchange or on the over-the-counter market. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with the Financial Industry Regulatory Authority for our common stock to be eligible for trading on the Over-the-Counter Bulletin Board. We do not yet have a market maker who has agreed to file such application. There can be no assurance that our common stock will ever be quoted on a stock exchange or a quotation service or that any market for our stock will develop. Emerging Growth Company We are an , ' ': , ' ': emerging growth company within the meaning of the federal securities laws. For as long as we are an emerging growth company, we will not be required to comply with the requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, the reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and the exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We intend to take advantage of these reporting exemptions until we are no longer an emerging growth company. For a description of the qualifications and other requirements applicable to emerging growth companies and certain elections that we have made due to our status as an emerging growth company, see "Risk Factors—Risks Related to this Offering and our Common Stock – We are an , ' ': emerging growth company and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors" on page 10 of this prospectus. Shahira Wely serves as our Chief Executive Officer and sole director. We are an early stage company that has generated no revenues and has had limited operations to date. From December 13, 2021 (date of inception) we have incurred accumulated net losses of $946. As of December 31, 2021 we had total assets of $9,054 and total liabilities of $255. We have sold and issued an aggregate of 5,000,000 shares of our common stock since our inception through the date of this Prospectus. All 5,000,000, or 100%, of the shares are held by Shahira Wely, our Chief Executive Officer and sole director. Due to the uncertainty of our ability to meet our current operating and capital expenses, our independent auditors have included a going concern opinion in their report on our audited financial statements for the period ended December 31, 2021. The notes to our financial statements contain additional disclosure describing the circumstances leading to the issuance of a going concern opinion by our auditors. THE OFFERING The Offering Securities offered: We are offering up to 3,000,000 of our common stock. Offering price: We will offer and sell our shares of common stock at a fixed price of $0.02 per share. Shares outstanding prior to offering: 5,000,000 Shares outstanding after offering: 8,000,000 Market for the common shares: There is no public market for our shares. Our common stock is not traded on any exchange or on the over-the-counter market. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with the Financial Industry Regulatory Authority ("FINRA") for our common stock to eligible for trading on the OTC Markets. We do not yet have a market maker who has agreed to file such application. There is no assurance that a trading market will develop, or, if developed, that it will be sustained. Consequently, a purchaser of our common stock may find it difficult to resell the securities offered herein should the purchaser desire to do so when eligible for public resale. Use of proceeds: We intend to use the net proceeds from the sale of our 3,000,000 shares (after deducting estimated offering expenses payable by us) for professional fees, further development of our website, administration expenses, and marketing and advertising. See "Use of Proceeds" on page 18 for more information on the use of proceeds. SUMMARY FINANCIAL INFORMATION The tables and information below are derived from our audited financial statements for the period from December 13, 2021 (Inception) to December 31, 2021. Our working capital at December 31, 2021 was $1,554. December 31, 2021 ($) Financial Summary (Audited) Cash and Deposits 1,554 Total Assets 9,054 Total Liabilities 0 Total Stockholder s Equity 9,054 Accumulated from December 13, 2021 (Inception) to December 31, 2021 Consolidated Statements of Expenses and Comprehensive Loss Total Operating Expenses 946 Net Loss for the Period 946 RISK FACTORS An investment in our common stock involves a number of very significant risks. You should carefully consider the following known material risks and uncertainties in addition to other information in this prospectus in evaluating our company and its business before purchasing shares of our company s common stock. You could lose all or part of your investment due to any of these risks. RISKS RELATING TO OUR COMPANY Our auditors have expressed substantial doubt about our ability to continue as a going concern. Our audited financial statements for the year ended December 31, 2021, were prepared assuming that we will continue our operations as a going concern. We were incorporated on December 13, 2021 and do not have a history of earnings. As a result, our independent accountants in their audit report have expressed substantial doubt about our ability to continue as a going concern. Continued operations are dependent on our ability to complete equity or debt financings or generate profitable operations. Such financings may not be available or may not be available on reasonable terms. Our financial statements do not include any adjustments that may result from the outcome of this uncertainty. The proceeds of this offering, if any, may not be sufficient to fund planned operations and may not even cover the costs of the offering and you may lose your entire investment. We are offering a maximum of 3,000,000 shares of our common stock at $0.02 per share, however there is no minimum to our offering. Funds we raise in this offering, if any, may not be sufficient to fund our planned operations and may not even cover the costs of this offering. If we are not able to raise any funds in this offering, our company will be in a worse financial position then prior to commencement of the offering as we will still incur the costs of this offering. If we do not raise sufficient funds in this offering to fund our operations or even cover the costs of this offering, you may lose your entire investment. There is uncertainty regarding our ability to continue as a going concern, indicating the possibility that we may be required to curtail or discontinue our operations in the future. If we discontinue our operations, you may lose all of your investment. We have incurred net losses of $946 from our inception on December 13, 2021 to December 31, 2021, and have completed only the preliminary stages of our business plan. We anticipate incurring additional losses before realizing any revenues and will depend on additional financing in order to meet our continuing obligations and ultimately, to attain profitability. We anticipate that our current cash assets will be extinguished by December 31, 2022. The financial statements do not include any adjustments that might result from the uncertainty about our ability to continue our business. If we are unable to obtain additional financing from outside sources and eventually produce enough revenues, we may be forced to sell our assets, or curtail or discontinue our operations. If this happens, you could lose all or part of your investment. We are in an early stage of development. If we are not able to develop our business as anticipated, we may not be able to generate revenues or achieve profitability and you may lose your investment. We were incorporated on December 13, 2021. We have no customers, and we have not earned any revenues to date. Our business prospects are difficult to predict because of our limited operating history, early stage of development, and unproven business strategy. Our primary business activities will be focused on the development of our Internet browser. Although we believe that our business plan has significant profit potential, we may not attain profitable operations and our management may not succeed in realizing our business objectives. If we are not able to develop out business as anticipated, we may not be able to generate revenues or achieve profitability and you may lose your investment. We expect to suffer losses in the immediate future that may cause us to curtail or discontinue our operations. We expect to incur operating losses in future periods. These losses will occur because we do not yet have any revenues to offset the expenses associated with the development of our Internet browser, generally. We cannot guarantee that we will ever be successful in generating revenues in the future. We recognize that if we are unable to generate revenues, we will not be able to earn profits or continue operations. There is no history upon which to base any assumption as to the likelihood that we will prove successful, and we can provide investors with no assurance that we will generate any operating revenues or ever achieve profitable operations. If we are unsuccessful in addressing these risks, our business will almost certainly fail. We may not be able to execute our business plan or stay in business without additional funding. Our ability to generate future operating revenues depends in part on whether we can obtain the financing necessary to implement our business plan. We will likely require additional financing through the issuance of debt and/or equity in order to establish profitable operations, and such financing may not be forthcoming. As widely reported, the global and domestic financial markets have been extremely volatile in recent months. If such conditions and constraints continue or if there is no investor appetite to finance our specific business, we may not be able to acquire additional financing through credit markets or equity markets. Even if additional financing is available, it may not be available on terms favorable to us. At this time, we have not identified or secured sources of additional financing. Our failure to secure additional financing when it becomes required will have an adverse effect on our ability to remain in business. The software industry is extremely competitive, and if we are not able to compete successfully against other Internet browsers, we will not be able operate our business and investors will lose their entire investment. The Internet browser, and software business generally, is extremely competitive and rapidly changing. We currently and in the future face competitive pressures from numerous actual and potential competitors. Many of our current and potential competitors in the Internet browser business have substantial competitive advantages than we have, including: longer operating histories; significantly greater financial, technical and marketing resources; greater brand name recognition; existing customer bases; and commercially accepted services. Our competitors may be able to respond more quickly to new or emerging technologies and changes in the Internet browser industry and devote greater resources to identify, develop and market new products, and distribute and sell their products than we can. The loss of the services of Shahira Wely, our Chief Executive Officer and director, or our failure to timely identify and retain competent personnel could negatively impact our ability to develop our website and sell our services. The development of Internet browser and the marketing of our prospective Internet browser will continue to place a significant strain on our limited personnel, management, and other resources. Our future success depends upon the continued services of our executive officers who are developing our business, and on our ability to identify and retain competent consultants and employees with the skills required to execute our business objectives. The loss of the services of Shahira Wely or our failure to timely identify and retain competent personnel could negatively impact our ability to develop our website and sell our services, which could adversely affect our financial results and impair our growth. We are a development stage, Internet browser development company, with no experience in the market, and failure to successfully compensate for this inexperience may adversely impact our operations and financial position. We operate as new Internet browser development company, with few substantial tangible assets in a highly competitive industry. We have little operating history, no customer base and no revenue to date. This makes it difficult to evaluate our future performance and prospects. Our prospects must be considered in light of the risks, expenses, delays and difficulties frequently encountered in establishing a new business in an emerging and evolving industry characterized by intense competition, including: our business model and strategy are still evolving and are continually being reviewed and revised; we may not be able to raise the capital required to develop our initial customer base and reputation; we may not be able to successfully implement our business model and strategy; and our management consists of one person, Shahira Wely, our Chief Executive Officer and director. We cannot be sure that we will be successful in meeting these challenges and addressing these risks and uncertainties. If we are unable to do so, our business will not be successful and the value of your investment in our company will decline. Our failure to protect our intellectual property and proprietary technology may significantly impair our competitive advantage. Our success and ability to compete depend in large part upon protecting our proprietary technology. We rely on a combination of patent, trademark and trade secret protection, nondisclosure and nonuse agreements to protect our proprietary rights. The steps we have taken may not be sufficient to prevent the misappropriation of our intellectual property, particularly in foreign countries where the laws may not protect our proprietary rights as fully as in the United States. The patent and trademark law and trade secret protection may not be adequate to deter third party infringement or misappropriation of our patents, trademarks and similar proprietary rights. In addition, patents issued to the us may be challenged, invalidated or circumvented. Our rights granted under those patents may not provide competitive advantages to us, and the claims under our patent applications may not be allowed. We may be subject to or may initiate interference proceedings in the United States Patent and Trademark Office, which can demand significant financial and management resources. The process of seeking patent protection can be time consuming and expensive and patents may not be issued from currently pending or future applications. Moreover, our existing patents or any new patents that may be issued may not be sufficient in scope or strength to provide meaningful protection or any commercial advantage to us. We may in the future initiate claims or litigation against third parties for infringement of our proprietary rights in order to determine the scope and validity of our proprietary rights or the proprietary rights of our competitors. These claims could result in costly litigation and the diversion of our technical and management personnel. We may face costly intellectual property infringement claims, the result of which would decrease the amount of cash we would anticipate to operate and complete our business plan. We anticipate that from time to time we will receive communications from third parties asserting that we are infringing certain patents and other intellectual property rights of others or seeking indemnification against alleged infringement. If anticipated claims arise, we will evaluate their merits. Any claims of infringement brought of third parties could result in protracted and costly litigation, damages for infringement, and the necessity of obtaining a license relating to one or more of our products or current or future technologies, which may not be available on commercially reasonable terms or at all. Litigation, which could result in substantial cost to us and diversion of our resources, may be necessary to enforce our patents or other intellectual property rights or to defend us against claimed infringement of the rights of others. Any intellectual property litigation and the failure to obtain necessary licenses or other rights could have a material adverse effect on our business, financial condition and results of operations. Because we are a shell company, it will likely be difficult for us to obtain additional financing by way of private offerings of our securities. We are a "shell company" within the meaning of Rule 405, promulgated pursuant to Securities Act, because we have nominal assets and nominal operations. Accordingly, the holders of securities purchased in private offerings of our securities we make to investors will not be able to rely on the safe harbor from being deemed an underwriter under SEC Rule 144 in order to resell their securities. This will likely make it more difficult for us to attract additional capital through subsequent unregistered offerings because purchasers of securities in such unregistered offerings will not be able to resell their securities in reliance on Rule 144, a safe harbor on which holders of restricted securities usually rely to resell securities. Because we are a shell company, you will not be able to resell your shares in certain circumstances, which could hinder the resale of your shares. We are a "shell company" within the meaning of Rule 405, promulgated pursuant to Securities Act, because we have nominal assets and nominal operations. Accordingly, the securities sold in this offering can only be resold through registration under Section 5 the Securities Act of 1933, Section 4(1), if available, for non-affiliates, or by meeting the conditions of Rule 144(i). Another implication of us being a shell company is that we cannot file registration statements under Section 5 of the Securities Act using a Form S-8, a short form of registration to register securities issued to employees and consultants under an employee benefit plan. Additionally, though exemptions, such as Section 4(1) of the Securities Act may be available for non-affiliate holders our shares to resell their shares, because we are a shell company, a holder of our securities may not rely on the safe harbor from being deemed statutory underwriter under Section 2(11) of the Securities Act, as provided by Rule 144, to resell his or her securities. Only after we (i) are not a shell company, and (ii) have filed all reports and other materials required to be filed by section 13 or 15(d) of the Exchange Act, as applicable, during the preceding 12 months (or for such shorter period that we may be required to file such reports and materials, other than Form 8-K reports); and have filed current "Form 10 information" with the SEC reflecting our status as an entity that is no longer a shell company for a period of not less than 12 months, can our securities be resold pursuant to Rule 144. "Form 10 information" is, generally speaking, the same type of information as we are required to disclose in this prospectus, but without an offering of securities. These circumstances regarding how Rule 144 applies to shell companies may hinder your resale of your shares of the Company. We are dependent on our Chief Executive Officer and sole director, without whose services company business operations could cease. At this time, Shahira Wely, our Chief Executive Officer and sole director, is wholly responsible for the development and execution of our business plan. Our Chief Executive Officer and sole director is under no contractual obligation to remain employed by us, although she has no present intention to leave. If our Chief Executive Officer and sole director should choose to leave us for any reason before we have hired additional personnel our operations may fail. Even if we are able to find additional personnel, it is uncertain whether we could find qualified management who could develop our business as described herein or would be willing to work for compensation the Company could afford. Without such management, the Company could be forced to cease operations and investors in our common stock or other securities could lose their entire investment. We are an "emerging growth company" and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors. We are an "emerging growth company," as defined in the Jumpstart our Business Startups Act of 2012, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. Additionally, for as long as we remain an emerging growth company we will have the ability to include only two years of audited financial statements and only two years of related management s discussion and analysis of financial condition and results of operations disclosure. We cannot predict if investors will find our common stock less attractive because we will not rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile. An emerging growth company may take advantage of these provisions until it is no longer an emerging growth company. We would cease to be an "emerging growth company" upon the earliest to occur of: (i) the last day of the fiscal year in which we have more than $1.07 billion in annual revenues; (ii) the date we qualify as a large accelerated filer, with at least $700 million of equity securities held by non-affiliates; (iii) the issuance, in any three-year period, by us of more than $1.0 billion in non-convertible debt securities; and (iv) the last day of the fiscal year ending after the fifth anniversary of this offering. We may choose to take advantage of some but not all of these reduced reporting burdens. Under the Jumpstart Our Business Startups Act, "emerging growth companies" can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have irrevocably elected not to avail ourselves to this exemption from new or revised accounting standards and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are not "emerging growth companies." It will be extremely difficult to acquire jurisdiction and enforce liabilities against our officers, directors and assets outside the United States. Substantially all of our assets are currently located outside of the United States. Additionally, our current sole officer and director resides outside of the United States, in Israel. As a result, it may not be possible for United States investors to enforce their legal rights, to effect service of process upon our current sole director or officer or to enforce judgments of United States courts predicated upon civil liabilities and criminal penalties of our directors and officers under Federal securities laws. Moreover, we have been advised Israel does not have a treaty providing for the reciprocal recognition and enforcement of judgments of courts with the United States. Further, it is unclear if extradition treaties now in effect between the United States and Israel would permit effective enforcement of criminal penalties of the Federal securities laws. We incur costs associated with SEC reporting compliance, which may significantly affect our financial condition. The Company have made the decision to become an SEC "reporting company." We will incur certain costs of compliance with applicable SEC reporting rules and regulations including, but not limited to attorneys fees, accounting and auditing fees, other professional fees, financial printing costs and Sarbanes-Oxley compliance costs in an amount estimated at approximately $25,000 per year. On balance, the Company determined that the incurrence of such costs and expenses was preferable to the Company being in a position where it had very limited access to additional capital funding. However, for as long as we remain an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2012, we intend to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We intend to take advantage of these reporting exemptions until we are no longer an "emerging growth company." We will remain an "emerging growth company" for up to five years, although if the market value of our common stock that is held by non-affiliates exceeds $700 million as of any June 30 before that time, we would cease to be an "emerging growth company" as of the following June 30. After, and if ever, we are no longer an "emerging growth company," we expect to incur significant additional expenses and devote substantial management effort toward ensuring compliance with those requirements applicable to companies that are not "emerging growth companies," including Section 404 of the Sarbanes-Oxley Act. You may have limited access to information regarding our business because our obligations to file periodic reports with the SEC could be automatically suspended under certain circumstances. As of the effective date of our registration statement of which this prospectus is a part, we will become subject to certain informational requirements of the Exchange Act, as amended and we will be required to file periodic reports (i.e., annual, quarterly and material events) with the SEC which will be immediately available to the public for inspection and copying. In the event during the year that our registration statement becomes effective, these reporting obligations may be automatically suspended under Section 15(d) of the Exchange Act if we have less than 300 shareholders and do not file a registration statement on Form 8-A (of which we have no current plans to file). If this occurs after the year in which our registration statement becomes effective, we will no longer be obligated to file such periodic reports with the SEC and access to our business information would then be even more restricted. After this registration statement on Form S-1 becomes effective, we may be required to deliver periodic reports to security holders as proscribed by the Exchange Act, as amended. However, we will not be required to furnish proxy statements to security holders and our directors, officers and principal beneficial owners will not be required to report their beneficial ownership of securities to the SEC pursuant to Section 16 of the Exchange Act until we have both 500 or more security holders and greater than $10 million in assets. This means that access to information regarding our business and operations will be limited. RISKS ASSOCIATED WITH OUR SECURITIES Due to the lack of a trading market for our securities, you may have difficulty selling any shares you purchase in this offering. Our shares of common stock do not trade on any exchange and are not quoted over-the-counter. There is presently no demand for our common stock and no public market exists for the shares being offered in this prospectus. We plan to contact a market maker immediately following the completion of the offering and apply to have the shares quoted on the OTC Markets. We cannot guarantee that our application will be accepted or approved and our stock quoted for sale. As of the date of this filing, there have been no discussions or understandings between the Company and anyone acting on our behalf, with any market maker regarding participation in a future trading market for our securities. If no market is ever developed for our common stock, it will be difficult for you to sell any shares you purchase in this offering. In such a case, you may find that you are unable to achieve any benefit from your investment or liquidate your shares without considerable delay, if at all. In addition, if we fail to have our common stock quoted on a public trading market, your common stock will not have a quantifiable value and it may be difficult, if not impossible, to ever resell your shares, resulting in an inability to realize any value from your investment. Because there is no escrow, trust or similar account, the offering proceeds could be seized by creditors or by a trustee in bankruptcy, in which case investors would lose their entire investment. Any funds that we raise from our offering of 3,000,000 shares of common stock will be immediately available for our use and will not be returned to investors. We do not have any arrangements to place the funds received from our offering of 3,000,000 shares of common stock in an escrow, trust or similar account. Accordingly, if we file for bankruptcy protection or a petition for involuntary bankruptcy is filed by creditors against us, your funds will become part of the bankruptcy estate and administered according to the bankruptcy laws. If a creditor sues us and obtains a judgment against us, the creditor could garnish the bank account and take possession of the subscription funds. As such, it is possible that a creditor could attach your subscription funds which could preclude or delay the return of money to you. If that happens, you will lose your investment and your funds will be used to pay creditors. Our common stock is subject to the "penny stock" rules of the SEC and there is no trading market in our securities, which makes transactions in our stock cumbersome and may reduce the value of an investment in our stock. Under U.S. federal securities legislation, our common stock will constitute "penny stock". Penny stock is any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require that a broker or dealer approve a potential investor s account for transactions in penny stocks, and the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased. In order to approve an investor s account for transactions in penny stocks, the broker or dealer must obtain financial information and investment experience objectives of the person, and make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks. The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prepared by the Commission relating to the penny stock market, which, in highlight form sets forth the basis on which the broker or dealer made the suitability determination. Brokers may be less willing to execute transactions in securities subject to the "penny stock" rules. This may make it more difficult for investors to dispose of our common stock and cause a decline in the market value of our stock. Disclosure also has to be made about the risks of investing in penny stocks in both public offerings and in secondary trading and about the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks. We may, in the future, issue additional common shares, which would reduce investors percent of ownership and may dilute our share value. Our Articles of Incorporation authorize the issuance of 75,000,000 shares of common stock. As of the date of this prospectus, the Company had 5,000,000 shares of common stock, and no shares of preferred stock, issued and outstanding. Accordingly, we may issue up to an additional 70,000,000 shares of common stock. The future issuance of common stock or preferred stock may result in substantial dilution in the percentage of our common stock held by our then existing shareholders. We may value any common stock issued in the future on an arbitrary basis. The issuance of common stock for future services or acquisitions or other corporate actions may have the effect of diluting the value of the shares held by our investors, and might have an adverse effect on any trading market for our common stock. Our insiders beneficially own a significant portion of our stock, and accordingly, may have control over stockholder matters, our business and management. There can be no assurances that our efforts to develop our proposed Internet browser will succeed or that we will be able to successfully market and generate revenues from our proposed Internet browser, if developed. As of the date of this prospectus, Ms. Wely beneficially owns 5,000,000 shares of our common stock in the aggregate, or 100% of our issued and outstanding shares of common stock. If we sell all 3,000,000 shares in the offering, our officers and sole director will hold 62.5% of the issued and outstanding shares of common stock of the Company. Therefore, our two officers, one of whom is our sole director, will have significant influence to: Elect or defeat the election of our directors; Amend or prevent amendment of our articles of incorporation or bylaws; effect or prevent a merger, sale of assets or other corporate transaction; and affect the outcome of any other matter submitted to the stockholders for vote. Moreover, because of the significant ownership position held by our insiders, new investors may not be able to effect a change in our business or management, and therefore, shareholders would have no recourse as a result of decisions made by management. In addition, sales of significant amounts of shares held by our officers and sole director, or the prospect of these sales, could adversely affect the market price of our common stock. Management s stock ownership may discourage a potential acquirer from making a tender offer or otherwise attempting to obtain control of us, which in turn could reduce our stock price or prevent our stockholders from realizing a premium over our stock price. We are selling this offering without an underwriter and may be unable to sell any shares. This offering is self-underwritten, that is, we are not going to engage the services of an underwriter to sell the shares; we intend to sell our shares through our Chief Executive Offices and sole director, Shahira Wely, who will not receive any commission. She will offer the shares to friends, family members, and business associates, however, there is no guarantee that she will be able to sell any of the shares. Unless she is successful in selling all of the shares and we receive the proceeds from this offering, we may have to seek alternative financing to implement our business plan. State securities laws may limit secondary trading, which may restrict the states in which and conditions under which you can sell the shares offered by this prospectus. Secondary trading in common stock sold in this offering will not be possible in any state until the common stock is qualified for sale under the applicable securities laws of the state or there is confirmation that an exemption, such as listing in certain recognized securities manuals, is available for secondary trading in the state. If we fail to register or qualify, or to obtain or verify an exemption for the secondary trading of, the common stock in any particular state, the common stock could not be offered or sold to, or purchased by, a resident of that state. In the event that a significant number of states refuse to permit secondary trading in our common stock, the liquidity for the common stock could be significantly impacted thus causing you to realize a loss on your investment. The Company does not intend to seek registration or qualification of its shares of common stock the subject of this offering in any state or territory of the United States. Aside from a "secondary trading" exemption, other exemptions under state law and the laws of US territories may be available to purchasers of the shares of common stock sold in this offering, Anti-takeover effects of certain provisions of Nevada state law hinder a potential takeover of our company. Though not now, in the future we may become subject to Nevada s control share law. A corporation is subject to Nevada s control share law if it has more than 200 stockholders, at least 100 of whom are stockholders of record and residents of Nevada, and it does business in Nevada or through an affiliated corporation. The law focuses on the acquisition of a "controlling interest" which means the ownership of outstanding voting shares sufficient, but for the control share law, to enable the acquiring person to exercise the following proportions of the voting power of the corporation in the election of directors: (i) one-fifth or more but less than one-third, (ii) one-third or more but less than a majority, or (iii) a majority or more. The ability to exercise such voting power may be direct or indirect, as well as individual or in association with others. The effect of the control share law is that the acquiring person, and those acting in association with it, obtains only such voting rights in the control shares as are conferred by a resolution of the stockholders of the corporation, approved at a special or annual meeting of stockholders. The control share law contemplates that voting rights will be considered only once by the other stockholders. Thus, there is no authority to strip voting rights from the control shares of an acquiring person once those rights have been approved. If the stockholders do not grant voting rights to the control shares acquired by an acquiring person, those shares do not become permanent non-voting shares. The acquiring person is free to sell its shares to others. If the buyers of those shares themselves do not acquire a controlling interest, their shares do not become governed by the control share law. If control shares are accorded full voting rights and the acquiring person has acquired control shares with a majority or more of the voting power, any stockholder of record, other than an acquiring person, who has not voted in favor of approval of voting rights is entitled to demand fair value for such stockholder s shares. Nevada s control share law may have the effect of discouraging takeovers of the corporation. In addition to the control share law, Nevada has a business combination law which prohibits certain business combinations between Nevada corporations and "interested stockholders" for three years after the "interested stockholder" first becomes an "interested stockholder," unless the corporation s board of directors approves the combination in advance. For purposes of Nevada law, an "interested stockholder" is any person who is (i) the beneficial owner, directly or indirectly, of ten percent or more of the voting power of the outstanding voting shares of the corporation, or (ii) an affiliate or associate of the corporation and at any time within the three previous years was the beneficial owner, directly or indirectly, of ten percent or more of the voting power of the then outstanding shares of the corporation. The definition of the term "business combination" is sufficiently broad to cover virtually any kind of transaction that would allow a potential acquiror to use the corporation s assets to finance the acquisition or otherwise to benefit its own interests rather than the interests of the corporation and its other stockholders. The effect of Nevada s business combination law is to potentially discourage parties interested in taking control of our company from doing so if it cannot obtain the approval of our board of directors. Because we do not intend to pay any cash dividends on our common stock, our stockholders will not be able to receive a return on their shares unless they sell them. We intend to retain any future earnings to finance the development and expansion of our business. We do not anticipate paying any cash dividends on our common stock in the foreseeable future. Unless we pay dividends, our stockholders will not be able to receive a return on their shares unless they sell them. Stockholders may never be able to sell shares when desired. Before
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: common stock are to our Class A common stock and our Class B common stock, collectively, par value $0.0001 per share; company or our company we, us, are to Acri Capital Acquisition Corporation; completion period are to the period following the completion of this offering at the end of which, if we have not completed our initial business combination, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, if any (less up to $50,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions and as further described herein. The completion period ends nine (9) months from the closing of this offering, which may be extended up to nine (9) times by an additional one month each time for a total of 9 months (the Paid Extension Period ), affording the Company up to eighteen (18) months to complete our initial business combination. DGCL are to the Delaware General Corporation Law equity-linked securities are to any securities of our company which are convertible into or exchangeable or exercisable for, common stock of our company, including but not limited to a private placement of equity or debt. founder shares are to shares of our Class B common stock initially purchased by our founders in the aggregated price of $25,000 in a private placement prior to this offering, and the shares of our Class A common stock issued upon the conversion thereof as provided herein; founders are to holders of our founder shares prior to this offering and holders of our private warrants upon the consummation of this offering which include our sponsor, officers and directors; and/or their designees; management or our management team are to our officers and directors; private warrants are to the warrants to be issued to our sponsor in a private placement simultaneously with the closing of this offering and the exercise of over-allotment option by the underwriters as applicable; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our founders and management team to the extent our founders and/or members of our management team purchase public shares, provided that each founder s status as a public stockholder shall only exist with respect to such public shares; public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); and sponsor are to Acri Capital Sponsor LLC, a Delaware limited liability company. warrants are to our private warrants and public warrants, as applicable. Registered trademarks referred to in this prospectus are the property of their respective owners. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. 1 Table of Contents PROPOSED BUSINESS General We are a newly organized blank check company formed as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any potential business combination target or initiated any discussions, directly or indirectly, with any potential business combination prospects. While we intend to undertake a search process, our ability to locate a potential target is subject to the uncertainties discussed elsewhere in this prospectus. Our Strategy and Industries Overview Provided that we will not undertake our initial business combination with any company being based in or having the majority of the company s operations in China (including Hong Kong and Macau), our efforts to identify a prospective target will not be limited to a particular industry or geographic region, although we intend to initially focus our search on identifying a prospective target in the technology-enabled industries in North America, namely within the geographic limits of the United States, Canada and Mexico. This geographic focus aligns well with the professional backgrounds of our directors and officers, most of whom live or work within the United States and Canada and have extensive professional networks and connections in these two countries. Our objectives are to generate compelling attractive returns for our stockholders and to enhance value through top line growth and hands on operational improvement for our potential target company. We believe our focus on technology-enabled companies, including but not limited to companies applying emerging and disruptive technologies and processes like Software-as-a-Service (SaaS), artificial intelligence, cloud computing, Internet of Things (IoTs) in a variety of service industries, particularly in the e-commerce, financial services, ed-tech services and health information services industries that would benefit from access to our management s networks and industry expertise. Our strategy is informed by our experience and expertise in investing, managing, and operating technology-enabled companies across different market segments and development stages. We have identified two areas of opportunities, which we identify as focal points : technology focal points and sector focal points. Technology Focal Points The COVID-19 pandemic opened a new era of opportunities for technology start-ups and growth companies in service delivery for businesses and individuals alike in a remote, digital environment. Among a variety of emerging and disruptive technologies and related processes, our management has identified a few key focal points that may generate significant investment opportunities in the next few years, including: Software-as-a-Service (SaaS): The technology industry witnesses the rise of Software-as-a-Services as a model of success for facilitating the digital transformation of business practices and processes. Salesforces acquisition of Slack precipitated the shift from on-premise software solutions to integrated software solutions ( SaaS 2.0 ). Saas 2.0 presents tremendous opportunities for providers that emphasize integration capabilities with other platforms while maintaining security and scalability that define the success of SaaS providers. Artificial Intelligence (AI): The backbone of business process, supply chain, and customer service optimization and automation lies at the integration of artificial intelligence into management solutions. This is particularly salient in the service industries where a continued push for streamlined service process and predictive service analytics dominate the discourse for transforming industrial landscape. In particular, as Forbes predicted, in 2022, industries like banking, financial services and insurance (BFSI), healthcare, communication, education and retails will benefit the most from AI-led business transformation. Cloud Computing: Even before the COVID-19 pandemic, businesses had already shifted towards cloud-based solutions and services. The COVID-19 pandemic only provided a new boost for the industry, with more businesses shifting their corporate infrastructures to the cloud. In a report prepared by Fortune Business Insights, a research entity, the global market generated an additional 13.7% of growth comparted with the average growth rate in the preceding three years, in large part due to the growing demand caused 2 Table of Contents by the COVID-19 pandemic as well as the advancement in artificial intelligence and machine learning. However, according to a report by market research firm Technavio, the global cloud computing market is expected to generate a year-on-year growth rate of 20.37% from 2021 to 2025, and the North American market is expected to contribute to 40% of the growth as its top and most mature market. Internet of Things (IoTs): The IoTs market is expected to generate significant growth in the next five years. The growth in this market is attributed to the development of wireless network technologies, emergence of advanced data analytics, reduction in cost for connecting devices, and increase in cloud computing offering. A BCC research report indicates that the global IoT market will experience an annual growth rate of 27.6% over the next five years. In addition to its already successful track records in the transportation, manufacturing and supply chain sectors, IoT s ability to optimize machine-to-machine connectivity has great potential to unlock opportunities in a variety of sectors ranging from healthcare, retail, to telecommunication. Sector Focal Points Our management brings a wealth of investment and management experience in tech-enabled businesses in industries ranging from education to financial services. Our management also identified several focus sectors where opportunities lie: E-commerce: Technology-enabled solutions play a significant role in the whole lifestyle of an e-commerce transaction. Technologies like artificial intelligence, machine learning, big data, digital stores and augmented reality inform decisions from product design, inventory management, consumer behavior analytics, targeted advertising, to social media strategies. As the retails and consumer good sector represents one of the fastest-growing vertical sectors in adopting emerging and disruptive technologies, we expect continued opportunities for growth and early-stage companies. Financial Services: The Banking, Financial Services and Insurance (BFSI) sectors present one of the most vibrant industry for integrating innovative technologies. In many ways, technologies can and do reshape the entire industry landscape for BFSI institutions, from front business functions in customer acquisition, retention and services, to middle business functions in fraud detection, risk management and security safeguards, to back business functions from in underwriting, loan processing and product management. According to one estimate by Business Insider, artificial intelligence alone would contribute to $450 billion of opportunities for BFSI sectors by 2023. Ed-tech Services: School and workplace closure during the COVID-19 pandemic has fundamentally changed the prospect of the ed-tech industry, with administrators, instructors, parents and students alike recognizing the importance of quality ed-tech platforms, programs and content. Government initiatives have also cultivated a booming environment for ed-tech providers to thrive. The global demand for hardware and software products, especially in the K-12 segment, would increase for 130% during the next five years, according to a Yahoo Finance article published on January 25, 2022. It is therefore unsurprising that investment opportunities in this area also picked up significantly, with TechCrunch, a leading news site for the VC industry, estimating that investments in the past two years equalled the aggregate amount raised during the entire 2014 to 2019 period. Health Information Services: Technology-enabled solutions from artificial intelligence, big data, natural language processing and machine learning, have played an increasingly important role in supplementing and streamlining the delivery of medical and healthcare services, supporting medical treatment functions ranging from reading and analyzing lab and imagining results, identifying treatment options, to predicting COVID-related hospitalization needs, as well as providing hospital management, telehealth, health informatics and analytics solutions. A January 2021 survey of leading industrial experts of some of the members of Forbes Technology Council predict that medical testing and diagnosis and healthcare delivery will be two key areas of growth for AI technology. 3 Table of Contents Our Founders and Management One of our founders is our sponsor, Acri Capital Sponsor LLC, managed by its sole member and our CEO, CFO and Chairwoman, Ms. Joy Yi Hua. Our management team consists of our officers and directors. Led by our Chairwoman, CEO, and CFO, Ms. Joy Yi Hua, our team has decades of combined experience in investing, managing and operating technology-enabled companies at all stages of their lifecycles. Ms. Joy Yi Hua is our Chief Executive Officer, Chief Financial Officer and Chairwoman. Ms. Hua has over 18 years of experience in investment management, hedge fund, private equity and real estate investment around the world. Since June 2016, Ms. Hua has served as the Managing Director of Serene View Capital LLC, an investment management and consulting firm. In June 2018, Ms. Hua founded Cohere Education LLC, an online education start-up engaged in the distribution of STEAM curriculum and programs to K-12 and college students in the U.S. and China. Before that, Ms. Hua co-founded and served as the Chief Operating Officer for MeshImpact LLC for the period between July 2016 and December 2018, overseeing financial and strategic planning for the consulting firm providing data analytics and machine learning solutions. Earlier in her career, Ms. Hua worked for CornerStone Parnters LLC for 8 years from 2008 to 2016 where she managed private equity and real assets portfolios of over 3 billion US dollars for 12 non-profit clients. Ms. Hua started her investment career at UVIMCO, the organization that manages the University of Virginia s $14.5 billion endowment, from 2004 to 2008. Ms. Hua received her MBA from the University of Texas at Austin in 2003, and a B.A. in Economics from Shanghai University of Finance & Economics in 1997. She has been a CFA charter holder since 2004. Mr. James Jim C. Hardin Jr. will become our independent director upon the effectiveness of the registration statement of which this prospectus is a part. Mr. Hardin has 20 years of experience in direct investments, co-investments, and fund investments in multiple private and public asset classes, sectors, and countries. He has particular investing experience in healthcare, fintech (bank software, payments), and community banks. He is currently an investment banker affiliated with Deer Isle Group, LLC and The Sponsor Fund Partners LLC. On the advisory side through Deer Isle Group, LLC, Mr. Hardin works with clients as a fractional general partner which is similar to a fractional strategic CFO role where he provides senior bandwidth to private equity general partners to support transaction execution and capital raising. Prior to partnering with Deer Isle, Mr. Hardin founded a technology-enabled service company for the lower middle market private equity ecosystem between 2014 and 2020, led private equity investing at full-service outsourced investment firm and Duke University-spinout Global Endowment Management (now $12B AUM) between 2009 and 2013, acquired and exited a point of sale payments company between 2009 and 2017, and co-managed a healthcare portfolio at the multi-strategy hedge fund Farallon Capital Management/Noonday (now $35B AUM) between 2004 and 2008. Mr. Hardin has also been a director of Affirmative Technologies, a provider of electronic payment risk management and fraud detection software, since 2018. Mr. Hardin has also been the President of Fund Investor Toolkit, LLC, a consulting service, since 2014. Mr. Hardin graduated cum laude in Economics (AB) from Harvard College. Mr. Edmund R. Miller will become our independent director upon the effectiveness of the registration statement of which this prospectus forms a part. Mr. Miller is a Senior Managing Director of Pan American Finance, LLC, an investment advisory firm where he has held this position since 2012. He has extensive private equity investment, fundraising and Telecommunication, Media, & Technology (TMT) experience. From 2002 to 2011, he was the Managing Director at Parmenter Realty Partners where he was in charge of all aspects of documenting and raising their second, third, and fourth institutional funds. Earlier in his career, from 1984 to 1996, Mr. Miller was co-manager of the largest Caribbean Basin and Latin American coverage team for Goldman Sachs, based in Miami. From 1996 to 1999, he managed a high yield fund for a large Latin American bank, managed a hedge fund, and was a founder and led the initial investment round in Answerthink (now known as The Hackett Group, NASDAQ: HCKT), an information technology consulting company. Mr. Miller was the co-founder of Interprise Technology Partners, a $110 million technology venture fund which made seven lead investments between 1999 and 2002. Prior to joining Goldman Sachs in 1984, Mr. Miller worked for Price Waterhouse in New York City in international tax for 4 years. He is a graduate of the University of Florida Warrington College of Business and the Levin College of Law. Mr. Miller was previously certified as a CPA and was a member of the New York Bar. 4 Table of Contents Mr. Andrew Pierce will become our independent director upon the effectiveness of the registration statement of which this prospectus forms a part. Mr. Pierce has more than a decade of experience in everything from data center auditing and IT support, to building world-class software and leading teams of engineers. Since 2014, Mr. Pierce has led the Platform Applications team for BlackSky Technology Inc. (NYSE: BKSY), a leading provider of real-time geospatial intelligence and global monitoring services, and has helped grow it from a $1M ARR startup into a publicly-traded powerhouse valued at over $1B on opening day. Prior to BlackSky, Mr. Pierce served as the Engineering Manager of Thermopylae Science and Technology s iSpatial platform. He is also the founder and owner of Banana Stand Technologies, Inc., a company engaged in web3 consulting services. From 2009 to 2010, he was on the team that built FederalReporting.gov, the system responsible for tracking the American Recovery and Reinvestment Act (ARRA) stimulus spending. He graduated with a B.S. in Computer Science and a B.A. in Japanese Studies from the College of William and Mary in 2009, and has spent time abroad living and working in Japan. Notwithstanding the foregoing, our officers and directors are not required to commit their full time to our affairs and will allocate their time to other businesses. We presently expect each of our employees to devote such amount of time as they reasonably believe is necessary to our business (which could range from only a few hours a week while we are trying to locate a potential target to a majority of their time as we move into negotiations with a target for a business combination). The past successes of our executive officers and directors do not guarantee that we will successfully consummate an initial business combination. In addition, the members of the management team may not remain with us subsequent to the consummation of a business combination. As more fully discussed in Management Conflicts of Interest, if any of our officers or directors becomes aware of a business combination opportunity that falls within the line of business of any entity to which he or she has pre-existing fiduciary or contractual obligations, he or she may be required to present such business combination opportunity to such entity, subject to his or her fiduciary duties under the DGCL, prior to presenting such business combination opportunity to us. Most of our officers and directors currently have certain pre-existing fiduciary duties or contractual obligations. Acquisition Criteria Our intent is to identify, acquire, and initiate a business combination with a target from various industries with the goal to build and grow its business. We will seek a potential target in which we believe can materially grow revenue and earnings through the efforts of a combined management team following the completion of our initial business combination. We shall not undertake our initial business combination with any company being based in or having the majority of the company s operations in China (including Hong Kong and Macau). Consistent with our business strategies and objectives, we have identified the following general criteria and guidelines that we believe are helpful and important in evaluating prospective targets for our initial business combination. While we intend to use these criteria and guidelines in evaluating prospective businesses, we may deviate from these criteria and guidelines should we see justification to do so. Strong management Team. We will seek to acquire those businesses with reasoned and strong managements having a track record of driving growth and profitability; or having proposition of the businesses that may likely be well received by public investors. Growth Potential. We intend to seek target companies that have underexploited expansion opportunities. This expansion can be accomplished through a combination of accelerating organic growth and finding attractive add-on acquisition targets. Our management team has significant experience in identifying such targets and in helping target management assess the strategic and financial fit. Similarly, our management has the expertise to assess the likely synergies and to help a target integrate acquisitions. Competitive Advantage. Target companies that we intend to seek will have significant competitive advantages and/or underexploited expansion opportunities that can benefit from access to additional capital as well as our industry relationships and expertise. Benefit from being a public company. We intend to only acquire a business or businesses that will benefit from being publicly traded and which can effectively utilize access to broader sources of capital and a public profile that are associated with being a publicly traded company. 5 Table of Contents This list of criteria and guidelines are not intended to be exhaustive. Our management team will evaluate and value potential targets on a case-by-case basis. Any evaluation relating to the merits of a particular initial business combination or acquisition may be based, to the extent relevant, on these general guidelines as well as other considerations, factors, and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target that does not meet the above criteria and guidelines, we will disclose that the target does not meet the above criteria and guidelines in our stockholder communications, which as discussed in the registration statement of which this prospectus forms a part would be in the form of proxy solicitation or tender offer materials that we would file with the SEC. Ability to Extend Time to Complete Business Combination If we anticipate that we may not be able to consummate our initial business combination within nine (9) months from the consummation of this offering, we may, but are not obligated to, if requested by our sponsor or its affiliates, extend the period of time to consummate a business combination up to nine (9) times by an additional one month each time for a total of up to 9 months (the Paid Extension Period ), affording the Company up to eighteen (18) months to complete our initial business combination. Public stockholders will not be offered the opportunity to vote on or redeem their shares if we choose to make any such paid extension. Pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement entered into between us and our Trust Agent on the date of this prospectus, in order to avail ourselves of the Paid Extension Period to consummate our initial business combination, our sponsor or its affiliates or designees, upon five days advance notice prior to the applicable deadline, must deposit into the trust account for each month extension $249,750, or $287,212.5 if the underwriters over-allotment option is exercised in full ($0.0333 per share in either case), on or prior to the date of the applicable deadline. Any such payments would be made in the form of a loan. Our sponsor or its affiliates or designees will receive a non-interest bearing, unsecured promissory note equal to the amount of any such deposit that will not be repaid in the event that we are unable to close a business combination unless there are funds available outside the trust account to do so. Such notes would either be paid upon consummation of our initial business combination solely from funds available outside of the trust account or, at the relevant insider s discretion, converted upon consummation of our business combination into additional private warrants at a price of $1.00 per warrant. If we do not complete a business combination, we will not repay such loans. In the event that we receive notice from our sponsor or its affiliates five days prior to the applicable deadline of its wish for us to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the applicable deadline. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. Our public stockholders will not be entitled to vote or redeem their shares in connection with any such paid extension. As a result, we may conduct such an extension even though a majority of our public stockholders do not support such an extension and will not be able to redeem their shares in connection therewith. Initial Business Combination Our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (excluding deferred underwriting discounts payable to our underwriters and taxes payable) at the time of the agreement to enter into the initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm that is a member of the Financial Industry Regulatory Authority ( FINRA ), or an independent accounting firm with respect to the satisfaction of such criteria. Our stockholders may not be provided with a copy of such opinion, nor will they be able to rely on such opinion. We shall not undertake our initial business combination with any company being based in or having the majority of the company s operations in China (including Hong Kong and Macau). Our amended and restated certificate of incorporation prohibits us from undertaking our initial business combination with any company being based in or having the majority of the company s operations in China (including Hong Kong and Macau). The net proceeds of this offering and the sale of the private warrants released to us from the trust account upon the closing of our initial business combination may be used as consideration to pay the sellers of a target business with which we complete our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in 6 Table of Contents connection with our initial business combination or used for redemption of our public shares, we may use the balance of the cash released to us from the trust account following the closing for general corporate purposes, including for maintenance or expansion of operations of the post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. In addition, we may be required to obtain additional financing in connection with the closing of our initial business combination to be used following the closing for general corporate purposes as described above. There is no limitation on our ability to raise funds through the issuance of equity or equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements or backstop agreements we may enter into following consummation of this offering. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our initial business combination. At this time, we are not a party to any arrangement or understanding with any third party with respect to raising any additional funds through the sale of securities or otherwise. None of our founders is required to provide any financing to us in connection with or after our initial business combination. We may also obtain financing prior to the closing of our initial business combination to fund our working capital needs and transaction costs in connection with our search for and completion of our initial business combination. Our amended and restated certificate of incorporation provides that, following this offering and prior to the consummation of our initial business combination, we will be prohibited from issuing additional securities that would entitle the holders thereof to (i) receive funds from the trust account or (ii) vote as a class with our public shares (a) on any initial business combination or (b) to approve an amendment to our certificate of incorporation to (x) extend the time we have to consummate a business combination beyond the completion period or (y) amend the foregoing provisions, unless (in connection with any such amendment to our certificate of incorporation) we offer our public stockholders the opportunity to redeem their public shares. Our Acquisition Process We will utilize the diligence, rigor, and expertise of our managements respective platforms to evaluate potential targets strengths, weaknesses, and opportunities to identify the relative risk and return profile of any potential target for our initial business combination. We currently do not have any specific business combination under consideration. Our officers and directors have not individually selected a target business. Our management team is continuously made aware of potential business opportunities, one or more of which we may desire to pursue for a business combination, but we have not (nor has anyone on our behalf) had any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such entity. Our management team is continuously made aware of potential investment opportunities, one or more of which we may desire to pursue for a business combination. In the event we seek to complete our initial business combination with a company that is affiliated with, or which there is a fiduciary, contractual or other obligation by, our sponsor, officers or directors, we, or a committee of independent directors, may obtain an opinion from an independent investment banking firm which is a member of the Financial Industry Regulatory Authority, or FINRA, or an independent accounting firm that the consideration to be paid by us in the initial business combination is fair to our company from a financial point of view. Any such entity may co-invest with us in the target business at the time of our initial business combination, or we could raise additional proceeds to complete the acquisition by making a specified future issuance to any such entity. 7 Table of Contents Permission Required from the PRC Authorities for this Offering and a Business Combination As a Delaware corporation with no operations in China, we are not required to obtain permission from any Chinese authorities to operate or to issue the securities being issued in this offering to any investors, including Chinese investors, if any and we do not expect that permission will be required from the Chinese authorities in connection our business combination since we will not undertake our initial business combination with any company being based in or having the majority of the company s operations in China (including Hong Kong and Macau). Private Placement On February 4, 2022, our sponsor acquired 2,156,250 shares of Class B common stock for an aggregate purchase price of $25,000, or the founder shares , from us. These founder shares include an aggregate of up to 281,250 founder shares that are subject to forfeiture to the extent that the underwriters over-allotment option is not exercised in full or in part, so that founder shares will represent 20% of our issued and outstanding shares after this offering (excluding the sale of the private unites and assuming our founders do not purchase public shares in this offering). None of our founders has indicated any intention to purchase public shares in this offering. In addition, our sponsor has committed to purchase from us an aggregate of 4,790,000 warrants, or private warrants, (or up to 5,240,000 private warrants if our underwriters exercise the over-allotment option) at $1.00 per warrant for a total purchase price of $4,790,000 (or up to $5,240,000 if our underwriters exercise the over-allotment option). The private warrants are identical to the warrants included in the units sold in this offering, except as described in this prospectus. The private warrants will be sold in a private placement that will close simultaneously with the closing of this offering. The founder shares are identical to the public shares. However, our founders have agreed (A) to vote their founder shares in favor of any proposed business combination, (B) not to propose, or vote in favor of, prior to and unrelated to an initial business combination, an amendment to our certificate of incorporation that would affect the substance or timing of our redemption obligation to redeem all public shares if we cannot complete an initial business combination within the completion period or extended completion period, unless we provide public stockholders an opportunity to redeem their public shares in conjunction with any such amendment, (C) not to redeem any shares, including founder shares into the right to receive cash from the trust account in connection with a stockholder vote to approve our proposed initial business combination or sell any shares to us in any tender offer in connection with our proposed initial business combination, and (D) that the founder shares shall not participate in any liquidating distribution upon winding up if a business combination is not consummated. Our founders have agreed, subject to certain exception, (i) in the case of founder shares, not to transfer, assign or sell any of their founder shares until the earlier of: (A) six months after the date of the consummation of our initial business combination, (B) the date on which we complete a liquidation, merger, stock exchange or other similar transaction after our initial business combination that results in all of our public stockholders having the right to exchange their shares of common stock for cash, securities or other property, and (C) the date on which the last reported sale price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing after our initial business combination, and (ii) in the case of private warrants, and any warrants may be issued upon the conversion of the working capital loans, or working capital warrants , until 30 days after the consummation our initial business combination (except as described herein under the section of this prospectus entitled Principal Stockholders Restrictions on Transfers of Founder Shares and Private Warrants ). We refer to such transfer restrictions throughout this prospectus as the lock-up. The proceeds from the private placement of the private warrants will be added to the proceeds of this offering and placed in a trust account in the United States maintained by Wilmington Trust, National Association, as trustee. If we do not complete our initial business combination within the completion period or extended completion period, the proceeds from the sale of the private warrants will be included in the liquidating distribution to the holders of our public shares. If public units or shares are purchased by any of our directors, officers or founders, they will be entitled to funds from the trust account to the same extent as any public stockholders upon our liquidation but will not have redemption rights related thereto. 8 Table of Contents Corporate Information Our executive offices are located at 13284 Pond Springs Rd, Ste 405, Austin, Texas 78729 and our telephone number is 512-666-1277. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A common stock that is held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates exceeds $250 million as of the end of that year s second fiscal quarter, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our common stocks held by non-affiliates exceeds $700 million as of the end of that year s second fiscal quarter. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible. 9 Table of Contents The Offering
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: Class A common stock are to our Class A common stock, par value $0.0001 per share; Class B common stock are to our Class B common stock, par value $0.0001 per share; common stock are to our Class A common stock and our Class B common stock, collectively; company or our company we, us, are to CE Energy Acquisition Corp.; equity-linked securities are to any securities of our company which are convertible into or exchangeable or exercisable for, common stock of our company, including but not limited to a private placement of equity or debt. founder shares are to shares of our Class B common stock initially purchased by our sponsor in a private placement prior to this offering, and the shares of our Class A common stock issued upon the conversion thereof as provided herein; initial stockholders are to our sponsor and any other holders of our founder shares prior to this offering (or their permitted transferees); management or our management team are to our officers and directors; private placement warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering, which private placement warrants are identical to the warrants sold in this offering, subject to certain limited exceptions as described in this prospectus; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder s and member of our management team s status as a public stockholder shall only exist with respect to such public shares; public warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market), to the private placement warrants if held by third parties other than our sponsor or the underwriters (or permitted transferees), and to any private placement warrants issued upon conversion of working capital loans that are sold to third parties that are not initial purchasers or executive officers or directors (or permitted transferees), in each case, following the consummation of our initial business combination; representative or Maxim are to Maxim Group, LLC, the representative of the underwriters in this offering; representative shares are to 100,000 shares of Class A common stock (115,000 shares of Class A common stock if the underwriters over-allotment option is exercised in full) to be issued to the representative of the underwriters at the closing of the offering; sponsor are to CE Energy Sponsors LLC, a Delaware limited liability company, whose members include entities controlled by certain of our directors and officers; and warrants are to our redeemable warrants, which includes the public warrants as well as the private placement warrants. Each unit consists of one share of Class A common stock and one redeemable warrant, each entitling the holder thereof to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as described in this prospectus. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Table of Contents The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED DECEMBER 8, 2022 PRELIMINARY PROSPECTUS $100,000,000 CE Energy Acquisition Corp. 10,000,000 Units CE Energy Acquisition Corp. is a newly organized blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. Although we are not limited to a particular industry or geographic region for purposes of consummating an initial business combination, we intend to focus our search for a target business in the energy industry with enterprise values of approximately $300 million to $1.0 billion. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one share of our Class A common stock and one redeemable warrant. Each warrant entitles the holder thereof to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as described in this prospectus. The warrants will become exercisable on the later of 30 days after the completion of our initial business combination or 12 months from the closing of this offering and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. The underwriters have a 45-day option from the date of this prospectus to purchase up to an additional 1,500,000 units to cover over-allotments, if any. We will provide our public stockholders with the opportunity to redeem all or a portion of their shares of our Class A common stock upon the completion of our initial business combination, subject to the limitations described herein. If we are unable to complete our initial business combination within nine months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination for up to three months on two occasions, as described in more detail in this prospectus), we will redeem 100% of the public shares for cash, subject to applicable law and certain conditions as further described herein. Our public stockholders will not be afforded an opportunity to vote on our extension of time to consummate an initial business combination from nine months to 15 months described above or redeem their shares in connection with such extensions. Our sponsor, CE Energy Sponsors LLC has agreed to purchase an aggregate of 6,000,000 warrants (or 6,600,000 warrants if the over-allotment option is exercised in full) at a price of $1.00 per warrant, for an aggregate purchase price of $6,000,000 (or $6,600,000 if the over-allotment option is exercised in full), in a private placement that will close simultaneously with the closing of this offering. The private placement warrants are identical to the warrants sold in this offering, subject to certain limited exceptions as described in this prospectus. All of the proceeds we receive from these purchases will be placed in the trust account described below and, together with the interest earned on the funds held in the trust account and except for payment of our franchise and income taxes, if any, shall not be released to us until the earlier of the completion of our initial business combination and our redemption of the shares of Class A common stock sold in this offering upon our failure to consummate a business combination within the required period. We are not permitted to use the proceeds placed in the trust account and the interest earned thereon to pay any excise taxes or any other similar fees or taxes in nature that may be imposed on the company pursuant to any current, pending or future rules or laws, including without limitation any excise tax due imposed under the Inflation Reduction Act of 2022 on any redemptions or stock buybacks by the company. Our sponsor owns an aggregate of 2,875,000 shares of our Class B common stock (up to 375,000 shares of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised), which will automatically convert into shares of Class A common stock at the time of our initial business combination, as described herein. Currently, there is no public market for our units, Class A common stock or warrants. We have applied to list our units on The Nasdaq Global Market, or Nasdaq, under the symbol CEACU. We cannot guarantee that our securities will be approved for listing on Nasdaq. We expect the Class A common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Maxim Group, LLC, the representative of the underwriters, informs us of its decision to allow earlier separate trading, subject to our satisfaction of certain conditions. Once the securities comprising the units begin separate trading, we expect that the Class A common stock and warrants will be listed on Nasdaq under the symbols CEAC and CEACW, respectively. We are an emerging growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 37 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. PER UNIT TOTAL Public offering price $ 10.00 $ 100,000,000 Underwriting commissions(1) $ 0.55 $ 5,500,000 Proceeds, before expenses, to CE Energy Acquisition Corp. $ 9.45 $ 94,500,000 (1) Includes $0.35 per unit, or $3,500,000 (or up to $4,025,000 if the underwriters over-allotment option is exercised in full) in the aggregate payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein. The deferred commissions will be released to the underwriters only on completion of an initial business combination, as described in this prospectus. See the section of this prospectus entitled Underwriting beginning on page 169 for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $102,000,000 or $117,300,000 if the underwriters over-allotment option is exercised in full ($10.20 per unit in either case) will be deposited into a trust account in the United States with Continental Stock Transfer & Trust Company acting as trustee, and $2,000,000 will be available to pay fees and expenses in connection with the closing of this offering and for working capital following the closing of this offering. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2023. Sole Bookrunner Maxim Group LLC , 2022 Table of Contents PROPOSED BUSINESS Our Company We are a newly organized blank check company incorporated as a Delaware corporation formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination or our business combination. To date, our efforts have been limited to organizational activities as well as activities related to this offering. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. We have generated no operating revenues to date and we may not generate operating revenues even after we consummate our initial business combination. While we may pursue an acquisition opportunity in any industry, sector or geographical location, we intend to focus our search for a target business in the energy industry, in particular, a business with assets used in exploring, developing, producing, transporting, storing, gathering, processing, fractionating, refining, distributing or marketing of natural gas, natural gas liquids, crude oil or refined products in North America, Central and South America. We may pursue an acquisition opportunity in renewable energy ( renewables ) which refers to energy from a source that is sustainable, such as wind, hydropower, geothermal or solar power. Past performance of our management team is not a guarantee either (i) of success with respect to any business combination we may consummate, or (ii) that we will be able to identify a suitable candidate for our initial business combination. You should not rely on the historical performance record of our management as indicative of our future performance. In addition, for a list of our executive officers and entities for which a conflict of interest may or does exist between such officers and the company, as well as the priority and preference that such entity has with respect to performance of obligations and presentation of business opportunities to us, please refer to the table and subsequent explanatory paragraph under Management Conflicts of Interest . Our officers and directors may become officers or directors of any other blank check company prior to completion of our initial business combination. As a result, our officers or directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. Our Board of Directors and Management Ryan E.M. Cunningham Chairman and Chief Executive Officer Ryan Cunningham is the President and Operational Partner of Cunningham Energy, LLC, an independent producer of oil and gas which he founded in 2008. He currently directs operations for Cunningham Energy, Marzcorp Oil & Gas Inc., Viper Capital Partners LLC and Raven Ridge Energy LLC. Mr. Cunningham served as operating partner of Black Crow Oil LLC from 2009 to 2010. From 1999 to 2001, Mr. Cunningham was a sales trader with Oppenheimer & Co. (formerly CIBC World Markets), initially with the private client division and then in its institutional trading group with middle markets and institutional sales trading teams before becoming head sales trader in 2001. Mr. Cunningham has been a Board member of the West Virginia Oil & gas Association since 2013. Mr. Cunningham received a Bachelor of Arts degree on Environmental Policy from Rollins College. Morgan (Mo) Fahimi Chief Financial Officer and Director Nominee Since March 2021 Mr. Fahimi has led the sales efforts of Acuris, a media company specializing in high-value content for financial professionals and dealogic platforms, which is owned Acuris by ION Investment Table of Contents Group, a financial software and data business. Acuris provides all-encompassing data and intelligence sets for the equity and fixed income institutional community as well the private equity markets, and is known for its products fixed income research provider Debtwire and Mergermarket, a specialist in M&A intelligence. Mr. Fahimi joined Mergermarket in 2005 as head of sales, where he led the sales effort of the Debtwire division, a worldwide leading fixed income data and intelligence platform. From 2007 to 2020, Mr. Fahimi was Managing Director Head of Sales for the Dealreporter business within Mergermarket, a worldwide leading Risk Arbitrage Data and Intelligence platform, where he was responsible for initiating all commercial relationships and distribution of global Dealreporter., From 2002 to 2004, Mr. Fahimi was an account executive with CIBC World Markets in institutional Middle Market Sales and Trading. Mr. Fahimi is a director of Signal Research, a US and UK based Quantitative, Macro and Technical Analysis Research firm catering to the Institutional investment community. He received a BA in Economics from Kingston University, London, England. Abdiel A. Santiago Director Nominee Abdiel Santiago has been the Secretariat (CEO/CIO) of the Fondo de Ahorro de Panam (Panama s Sovereign Wealth Fund) since 2013. From 2012 to 2013, he was a senior adviser at G-2 Capital focusing on financial restructuring opportunities. From 2005 to 2011, he was an equity investment research executive at Morgan Stanley in New York covering the energy and industrial sectors. From 1998 to 2002, Mr. Santiago served as a financial analyst/examiner at the US Securities and Exchange Commission overseeing financial/regulatory matters at broker-dealers and asset managers. Mr. Santiago received an MBA from the Kellogg School of Management at Northwestern University and a Bachelor s degree from the University of Denver. Tyler Hardt Director Nominee Tyler Hardt is the Chief Investment Officer of Pelican Bay Capital Bay Management, LLC, which he founded in July 2018. From June 2009 to June 2018, Mr. Hardt was as an equity analyst on the Domestic Value Team at Artisan Partners Asset Management. From 2004 to 2005, he was a corporate development analyst on the Corporate Mergers & Acquisitions and Corporate Strategy group at AT&T and from 2005 to 2007 he was strategic planning analyst on the Corporate Mergers & Acquisitions and Corporate Strategy group at American Tire Distributors. Mr. Hardt received an MBA with Honors from the Wharton School at the University of Pennsylvania, and a Bachelor of Science in Finance from the University of Maryland, where he graduated cum laude. Gerald M. Titus III Director Nominee Gerald M.Titus III has been a member of Spilman Thomas & Battle, PLLC, a regional law firm based in Charleston, West Virginia since 2008. He represents clients in the oil and gas industry. Prior to joining Spilman Thomas & Battle, PLLC, Mr. Titus was an Assistant United States Attorney for the United States Department of Justice. He received JD and Bachelor degrees from Washington and Lee University. Industry Opportunity While we may acquire a business in any industry, our strategy is to source, acquire and, after our initial business combination, grow, an oil and gas exploration and production ( E&P ) or midstream business. E&P companies focus on finding, producing and marketing various forms of crude oil and natural gas and midstream businesses and on gathering, separating, storing and transporting various hydrocarbons. We believe that there is a unique and timely opportunity to achieve attractive returns by acquiring and developing E&P assets in proven basins with known operational and limited geologic risks. We believe this opportunity exists due to several key factors: (i) the recent fluctuations in commodity prices had an immediate and meaningful impact on the cash flows of E&P companies, creating a need for many E&P firms to issue external capital or sell assets; (ii) the heightened activity in U.S. shale operations and global deep-water developments has resulted in smaller mature, brownfield production operations being relatively starved of capital resources; Table of Contents (iii) digital technologies are having a revolutionary impact on the efficiency of many industry sectors, including energy, but relatively little of that technology is currently being applied to brownfield mature production, which, harboring abundant data and information, will benefit from integrated digital technologies unlocking critical aspects of reservoir performance impacting cash flow; (iv) the recent fluctuations in commodity prices and declining U.S. shale oil cost structure has substantially reduced E&P asset valuations and is moderating drilling and completion costs, and operating costs, resulting in a lower cost to acquire and develop. Volatility of U.S. natural gas futures prices has risen during the past seven months, reaching record-high levels in February. Historical volatility measures the magnitude of daily changes in the closing price for a commodity during a specific time in the past. Based on rolling front-month contracts, the 30-day historical volatility of the U.S. natural gas futures price was 179.1% for February, almost doubling from January. The previous record natural gas price volatility for any month was October 2009, when the historical volatility averaged 123.8% (U.S. Energy Information Administration); (v) the short-term commodity price volatility has depressed asset values that don t reflect our positive long-term outlook for crude oil and natural gas demand and the need for higher commodity prices to meet expected demand growth; the invasion of Ukraine by Russia and subsequent sanctions on Russia and other actions created significant market uncertainties about the potential for oil supply disruptions. These events are occurring against a backdrop of low oil inventories and persistent upward oil price pressures (U.S. Energy Information Administration); and (vi) the largest oil and gas companies, including ExxonMobil, Royal Dutch Shell, Chevron and BP, are projected to sell a combined $100 billion in oil and gas assets around the world as they focus on top-performing regions according to a new analysis from consulting firm Rystad Energy (October 2020). We also believe there is significant potential to acquire and, after our initial business combination, grow a midstream business, particularly in international regions with expected and growing hydrocarbon production profiles. We believe our management team is well positioned to take advantage of opportunities within the energy sector and create value for our stockholders. Our management team has a history in oil and gas, with a deep knowledge of the industry and a well-established network of relationships with public and private oil and gas companies, National Oil Companies (NOCs), Government Licensing Authorities, equity sponsors, lending institutions, family offices, attorneys and brokers, from which we expect to generate attractive acquisition opportunities. While we will consider assets globally that meet our business strategy criteria, we do consider energy assets in Central and South America of particular interest given current relative valuation, reservoir potential and/or legacy of development. Notwithstanding above ground political and operating challenges, infrastructure and reservoir quality are of particular importance for brownfield re-development and midstream investments. According to the BP Statistical Review of World Energy 2019, Latin America (Mexico, Central and South America) has the highest Reserve to Production ratio, or R/P ratio, of 106 years compared to a global average of 50 years, Africa of 42 years, Europe of 11 years, Commonwealth of Independent States (CIS) of 27 years, Middle East of 72 years and North America of 29 years. The size of the reserves and resources relative to current production illustrates a historical relative under-investment in the region. While we may acquire an E&P business, we also may focus on companies in the renewable energy industry worldwide. We intend to focus on companies that have strong management teams, high growth potential, and that would benefit from access to capital to fund acquisitions or working capital for organic growth. We believe the renewable energy industry represents an attractive target market with many potential acquisition opportunities. Renewable energy growth may accelerate in 2022 with recent announcements to spend between $1 trillion and $2 trillion per year over the next ten years in the U.S., to increase the use of clean energies in the transportation, electricity and building sectors. Table of Contents Business Combination Criteria Consistent with our acquisition strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities. While we intend to acquire companies that we believe exhibit one or more of the following characteristics, we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. We intend to acquire companies that we believe have the following characteristics: Management Control: It will be an important factor to have operational control rather than being a passive equity partner. Existing staff needs to have credentials, expertise and performance that are aligned with future operational activity. Potential should exist for local and expatriate recruitment to compliment the special requirements of future operational activity. Furthermore, the ability to contract specialized consultants and service companies should exist. Ease of Operating: Health, Safety, Security, Environmental and Social (HSSES) standards, procedures and performance will be a critical element of future operational activity; historical records and performance will be an essential element in assessing suitability for future efficient and effective performance. Financial Restructuring: Capital Allocation, Cash Flow Analysis, Authority for Expenditure (AFE), Economic Modeling processes and Corporate Finance integration will be essential processes to ensure effective and efficient future operation. An assessment of existing processes should highlight deficiencies and where essential restructuring modifications should not be too onerous. For potential E&P acquisitions, we intend to target opportunities with: Subsurface materiality: Existing production is 10,000bopd, where historical production suggests significant increases can be achieved through, but not restricted to a variety of well interventions, infill wells, pressure support, pattern reconfigurations and other operational activity. Independent Reserve Audits demonstrate material Proven Undeveloped Reserves (PUD s), together with Probable (P2), Possible (P3) and Contingent Resources exist. Realistic Field Development Plans (FDP s) are in place or can be constructed. Sufficient surveillance data and information is available to envisage significant impact can be achieved with the implementation of various Digital Science and Analysis techniques. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our stockholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation materials or tender offer documents that we would file with the SEC. The evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our stockholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC. Sourcing of potential business combination targets We believe that the operational and transactional experience of our management team and the relationships they have developed as a result of such experience, will provide us with a substantial number of potential business combination targets. These individuals and entities have developed a broad network of contacts and corporate Table of Contents relationships around the world. This network has grown through sourcing, acquiring and financing businesses and maintaining relationships with sellers, financing sources and target management teams. Our management team members have significant experience in executing transactions under varying economic and financial market conditions. We believe that these networks of contacts and relationships and this experience will provide us with important sources of investment opportunities. In addition, we anticipate that target business candidates may be brought to our attention from various unaffiliated sources, including investment market participants, private equity funds and large business enterprises seeking to divest noncore assets or divisions. We are not prohibited from pursuing an initial business combination with a business combination target that is affiliated with our sponsor, officers or directors or making the acquisition through a joint venture or other form of shared ownership with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or an independent accounting firm that our initial business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other context. If any of our officers or directors becomes aware of a business combination opportunity that falls within the line of business of any entity to which he or she has then-current fiduciary or contractual obligations, he or she may be required to present such business combination opportunity to such entity prior to presenting such business combination opportunity to us, subject to his or her fiduciary duties. Our officers and directors currently have certain relevant fiduciary duties or contractual obligations that may take priority over their duties to us. Any such entity may co-invest with us in the target business at the time of our initial business combination, or we could raise additional proceeds to complete the acquisition by making a specified future issuance to any such entity. Other acquisition considerations Unless we complete our initial business combination with an affiliated entity, or our Board of Directors cannot independently determine the fair market value of the target business or businesses, we are not required to obtain an opinion from an independent investment banking firm, another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or from an independent accounting firm that the price we are paying for a target is fair to our company from a financial point of view. If no opinion is obtained, our stockholders will be relying on the business judgment of our Board of Directors, which will have significant discretion in choosing the standard used to establish the fair market value of the target or targets, and different methods of valuation may vary greatly in outcome from one another. Such standards used will be disclosed in our tender offer documents or proxy solicitation materials, as applicable, related to our initial business combination. Members of our management team may directly or indirectly own shares of our common stock and/or private placement warrants following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Each of our directors and officers presently has, and in the future any of our directors and our officers may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present acquisition opportunities to such entity. Accordingly, subject to his or her fiduciary duties, if any of our officers or directors becomes aware of an acquisition opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she will need to honor his or her fiduciary or contractual obligations to present such acquisition opportunity to such entity, and only present it to us if such entity rejects the opportunity. In addition, we may, at our option, pursue an Affiliated Joint Acquisition opportunity with an entity to which an officer or director has a fiduciary or contractual obligation. Table of Contents Any such entity may co-invest with us in the target business at the time of our initial business combination, or we could raise additional proceeds to complete the acquisition by making a specified future issuance to any such entity. A director shall be at liberty to vote in respect of any contract or transaction in which he is interested provided that the nature of such interest shall be disclosed at or prior to its consideration or any vote thereon by the board of directors. We do not believe, however, that any fiduciary duties or contractual obligations of our directors or officers would materially undermine our ability to complete our business combination. Initial Business Combination We will have nine months from the closing of this offering to consummate an initial business combination. However, if we anticipate that we may not be able to consummate our initial business combination within nine months, we may, by resolution of our board if requested by our sponsor, extend the period of time to consummate a business combination by an additional three months on two occasions (for a total of up to 15 months to complete a business combination), subject to our sponsor depositing additional funds into the trust account, upon five days advance notice prior to the applicable deadline, $1,000,000, or $1,150,000 if the underwriters over-allotment option is exercised in full ($0.10 per unit in either case), for each of the available three month extensions, providing a total possible business combination period of 15 months at a total payment value of $2,000,000, or $2,300,000 if the underwriters over-allotment option is exercised in full (each such extension period being hereinafter referred to as an Extension Period ). Any such payments would be made in the form of non-interest bearing loans. If we complete our initial business combination, we will, at the option of our sponsor, repay such loaned amounts out of the proceeds of the trust account released to us or convert a portion or all of the total loan amount into warrants at a price of $1.00 per warrant, which warrants will be identical to the private placement warrants. If we do not complete a business combination, we will repay such loans only from funds held outside of the trust account. Our stockholders will not be entitled to vote or redeem their shares in connection with any such extension. However, our stockholders will be entitled to vote and redeem their shares in connection with a stockholder meeting held to approve an initial business combination or in a tender offer undertaken in connection with such an initial business combination if we propose such a business combination during any three-month extension period. If we are unable to consummate our initial business combination within such time period, we will, as promptly as possible but not more than ten business days thereafter, redeem 100% of our outstanding public shares for a pro rata portion of the funds held in the trust account, including a pro rata portion of any interest earned on the funds held in the trust account, net of taxes payable and liquidation expenses of up to $100,000, and then seek to dissolve and liquidate. However, we may not be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public stockholders. In the event of our dissolution and liquidation, the private placement warrants will expire and will be worthless. Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm that is a member of FINRA or an independent accounting firm with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination either (i) in such a way so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets Table of Contents of the target business or businesses, or (ii) in such a way so that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders, or for other reasons. However, we will only complete an initial business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act . Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of Nasdaq s 80% of net assets test. If the initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. Our Business Combination Process In evaluating prospective business combinations, we expect to conduct a thorough due diligence review process that will encompass, among other things, a review of historical and projected financial and operating data, meetings with management and their advisors (if applicable), on-site inspection of facilities and assets, discussion with customers and suppliers, legal reviews and other reviews as we deem appropriate. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm that is a member of FINRA or an independent accounting firm that our initial business combination is fair to our company from a financial point of view. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he has then-current fiduciary or contractual obligations to present the opportunity to such entity, he will honor his fiduciary or contractual obligations to present such opportunity to such entity. We believe, however, that the fiduciary duties or contractual obligations of our officers or directors will not materially affect our ability to complete our initial business combination. Our second amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his capacity as a director or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation. Corporate Information Our executive offices are located at United Center, 500 Virginia Street East, 10th floor, Charleston, West Virginia 25301, and our telephone number is (304) 859-7440. Table of Contents We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A common stock that is held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates exceeds $250 million as of the end of the prior June 30th, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as of the prior June 30th. Table of Contents THE OFFERING In deciding whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section of this prospectus entitled Risk Factors. Securities offered 10,000,000 units, at $10.00 per unit, each unit consisting of: one share of Class A common stock; and one redeemable warrant, with each warrant exercisable for one share of Class A common stock at a price of $11.50 per share. Proposed Nasdaq symbols Units: CEACU Class A common stock: CEAC Warrants: CEACW Trading commencement and separation of Class A common stock and warrants The units will begin trading on or promptly after the date of this prospectus. We expect the Class A common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Maxim Group LLC informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the shares of Class A common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of Class A common stock and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase a multiple of four units, you will not be able to receive or trade a whole warrant. Separate trading of the Class A common stock and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A common stock and warrants be traded separately until we have filed a Current Report on Form 8-K with the SEC containing an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which is anticipated to take place three business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. Units: Number outstanding before this offering 0 Table of Contents Number outstanding after this offering 10,000,000(1) Common stock: Number outstanding before this offering 2,875,000 shares of Class B common stock(2) Number outstanding after this offering 12,600,000 shares of Class A common stock and Class B common stock(1)(3) Warrants: Number outstanding before this offering 0 Number of private placement warrants to be sold in a private placement simultaneously with this offering 6,000,000(1) Number of warrants to be outstanding after this offering and the private placement 16,000,000(1)(4) Exercisability Each warrant entitles the holder thereof to purchase one share of Class A common stock. Exercise price $11.50 per share, subject to adjustment as described herein. In addition, if (x) we issue additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or its affiliates, prior to such issuance) (the Newly Issued Price ), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average reported sale price of our common stock during the 10 trading days ending on the third trading day prior to the day on which we consummate our initial business combination (such price, (1) Assumes no exercise of the underwriters over-allotment option and the forfeiture by our initial stockholders of 375,000 founder shares. (2) Includes up to 375,000 shares that are subject to forfeiture by our initial stockholders depending on the extent to which the underwriters over-allotment option is exercised. (3) Comprised of 10,000,000 shares of Class A common stock included in the units to be sold in this offering and 2,500,000 shares of Class B common stock (or founder shares) and 100,000 shares of Class A common stock to be issued to Maxim Group LLC and/or its designees at the closing of the offering. The Class B common stock is convertible into shares of our Class A common stock on a one-for-one basis, subject to adjustment as described below adjacent to the caption Founder shares conversion and anti-dilution rights. (4) Comprised of 10,000,000 public warrants included in the units to be sold in this offering and 6,000,000 private placement warrants to be sold in the private placement. Table of Contents the Market Value ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price described below under Redemption of warrants will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. Exercise period The warrants will become exercisable on the later of: 30 days after the completion of our initial business combination, or 12 months from the closing of this offering; provided in each case that we have an effective registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise of the warrants and a current prospectus relating to them is available (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). We are not registering the shares of Class A common stock issuable upon exercise of the warrants at this time. However, we have agreed that as soon as practicable, but in no event later than 15 business days after the closing of our initial business combination, we will use our best efforts to file with the SEC a registration statement covering the shares of Class A common stock issuable upon exercise of the warrants, to cause such registration statement to become effective and to maintain the effectiveness of such registration statement, and a current prospectus relating to those shares of Class A common stock until the warrants expire, as specified in the warrant agreement. If a registration statement covering the shares of Class A common stock issuable upon exercise of the warrants is not effective within 60 business days after the closing of our initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption. Notwithstanding the above, if our Class A common stock is at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, and in the event we do not so elect, we will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier Table of Contents upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. Redemption of warrants Once the warrants become exercisable, we may redeem the outstanding warrants (excluding the private placement warrants but including any outstanding warrants issued upon exercise of the unit purchase option issued to the representative and/or its designees): in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period; and if, and only if, the last sale price of our Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) on each of 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. We will not redeem the warrants unless a registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise of the warrants is effective and a current prospectus relating to those shares of Class A common stock is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may not exercise our redemption right if the issuance of shares of common stock upon exercise of the warrants is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect such registration or qualification. We will use our best efforts to register or qualify such shares of common stock under the blue sky laws of the state of residence in those states in which the warrants were offered by us in this offering. If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a cashless basis. In determining whether to require all holders to exercise their warrants on a cashless basis, our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our stockholders of issuing the maximum number of shares of Class A common stock issuable upon the exercise of our warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value shall mean the average reported last sale price of the Class A common stock for the 10 Table of Contents trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Please see the section of this prospectus entitled Description of Securities Redeemable Warrants Public Stockholders Warrants for additional information. None of the private placement warrants will be redeemable by us so long as they are held by the sponsor or its permitted transferees. Founder shares On December 28, 2021, our sponsor purchased 2,875,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.009 per share. The per share purchase price of the founder shares was determined by dividing the amount of cash contributed to the company by the aggregate number of founder shares issued. The number of founder shares issued was determined based on the expectation that the founder shares would represent 20% of the outstanding shares after this offering (excluding the representative s shares). As such, our initial stockholders will collectively own 20% of our issued and outstanding shares after this offering, assuming our sponsor or our directors or officers do not purchase units in this offering and excluding the representative shares. Neither our sponsor nor any of our officers or directors have expressed an intention to purchase any units in this offering. Up to 375,000 founder shares will be subject to forfeiture by our initial stockholders depending on the extent to which the underwriters over-allotment option is exercised so that our initial stockholders will maintain ownership of 20% of our common stock after this offering, excluding the representative shares. We will effect a stock dividend or share contribution prior to this offering should the size of the offering change, in order to maintain such ownership percentage. The founder shares are identical to the shares of Class A common stock included in the units being sold in this offering, except that: the founder shares are shares of Class B common stock that automatically convert into shares of our Class A common stock at the time of our initial business combination, on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described herein; the founder shares are subject to certain transfer restrictions, as described in more detail below; our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to (i) waive their redemption rights with respect to their founder shares and public shares in connection with the completion of our initial business combination, (ii) waive their redemption rights with respect to their founder shares and public shares in connection with a stockholder vote to approve an amendment to our second amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within nine months from the closing Table of Contents of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by three months on up to two occasions as described in more detail in this prospectus) or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity and (iii) waive their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within nine months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by up to three months on two occasions as described in more detail in this prospectus), although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame; pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote any founder shares held by them and any public shares purchased during or after this offering (including in open market and privately negotiated transactions) in favor of our initial business combination. If we submit our initial business combination to our public stockholders for a vote, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. As a result, in addition to our initial stockholders founder shares, we would need only 3,800,001, or 38.0%, of the 10,000,000 public shares sold in this offering to be voted in favor of an initial business combination (assuming all outstanding shares are voted) in order to have our initial business combination approved (assuming the over-allotment option is not exercised); and the founder shares are entitled to registration rights. Transfer restrictions on founder shares Our initial stockholders have agreed not to transfer, assign or sell any of their founder shares until the earlier to occur of (i) one year after the date of the consummation of our initial business combination or (ii) the date on which we consummate a liquidation, merger, stock exchange or other similar transaction which results in all of our stockholders having the right to exchange their shares of Class A common stock for cash, securities or other property (except as described herein under the section of this prospectus entitled Principal Stockholders Restrictions on Transfers of Founder Shares and Private Placement Warrants ). Any permitted transferees will be subject to the same restrictions and other agreements of our initial stockholders with respect to any founder shares. Notwithstanding the foregoing, if the closing price of our shares of Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing 150 days after our initial business Table of Contents combination, the founder shares will no longer be subject to such transfer restrictions. We refer to such transfer restrictions throughout this prospectus as the lock-up. Founder shares conversion and anti-dilution rights The shares of Class B common stock will automatically convert into shares of our Class A common stock at the time of our initial business combination on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in this prospectus and related to the closing of the initial business combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of this offering plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with the initial business combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in the initial business combination or any private placement-equivalent units issued to our sponsor, its affiliates or certain of our officers and directors upon conversion of working capital loans made to us). Holders of founder shares may also elect to convert their shares of Class B common stock into an equal number of shares of Class A common stock, subject to adjustment as provided above, at any time. The term equity-linked securities refers to any debt or equity securities that are convertible, exercisable or exchangeable for shares of Class A common stock issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt. Securities could be deemed issued for purposes of the conversion rate adjustment if such shares are issuable upon the conversion or exercise of convertible securities, warrants or similar securities. Voting Rights Holders of the Class A common stock and holders of the Class B common stock will vote together as a single class on all matters submitted to a vote of our stockholders, with each share of common stock entitling the holder to one vote. Private placement warrants and underlying securities Our sponsor has agreed to purchase an aggregate of 6,000,000 warrants (or 6,600,000 warrants if the over-allotment option is exercised in full) at a price of $1.00 per warrant, for an aggregate purchase price of $6,000,000, or $6,600,000 if the over-allotment option is exercised in full. The private placement warrants are identical to the warrants sold in this offering except that the private Table of Contents placement warrants, so long as they are held by our sponsor or the underwriters or their permitted transferees, (i) will not be redeemable by us, (ii) may not (including the Class A common stock issuable upon exercise of these warrants), subject to certain limited exceptions, be transferred, assigned or sold by the holders until 30 days after the completion of our initial business combination, (iii) may be exercised by the holders on a cashless basis and (iv) will be entitled to registration rights. A portion of the purchase price of the private placement warrants will be added to the proceeds from this offering to be held in the trust account such that at the time of closing $102,000,000 (or $117,300,000 if the underwriters exercise their over-allotment option in full) will be held in the trust account. If we do not complete our initial business combination within nine months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by three months on up to two occasions as described in more detail in this prospectus), the proceeds from the sale of the private placement warrants held in the trust account will be used to fund the redemption of our public shares (subject to the requirements of applicable law) and the private placement warrants (and the underlying securities) will expire worthless. The private placement warrants will be non-redeemable and exercisable on a cashless basis so long as they are held by the sponsor, the underwriters or their permitted transferees. If the private placement warrants are held by holders other than the sponsor or its permitted transferees, the private placement warrants will be redeemable by us and exercisable by the holders on the same basis as the warrants included in the units being sold in this offering. Transfer restrictions on private placement warrants and underlying securities The private placement warrants (including the shares of Class A common stock issuable upon exercise of the private placement warrants) will not be transferable, assignable or saleable until 30 days after the completion of our initial business combination (except as described under the section of this prospectus entitled Principal Stockholders Restrictions on Transfers of Founder Shares and Private Placement Warrants ). Following such period, the private placement warrants (including the shares of Class A common stock issuable upon exercise of the private placement warrants) will be transferable, assignable or saleable, except that the private placement warrants will not trade. Cashless exercise of private placement warrants If holders of private placement warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering their warrants for that number of shares of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value shall mean the average reported last sale price of Table of Contents the Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent. The reason that we have agreed that these warrants will be exercisable on a cashless basis so long as they are held by the sponsor or its permitted transferees is because it is not known at this time whether they will be affiliated with us following an initial business combination. If they remain affiliated with us, their ability to sell our securities in the open market will be significantly limited. We expect to have policies in place that prohibit insiders from selling our securities except during specific periods of time. Even during such periods of time when insiders will be permitted to sell our securities, an insider cannot trade in our securities if he or she is in possession of material non-public information. Accordingly, unlike public stockholders who could sell the shares of Class A common stock issuable upon exercise of the warrants freely in the open market, the insiders could be significantly restricted from doing so. As a result, we believe that allowing the holders to exercise such warrants on a cashless basis is appropriate. Proceeds to be held in trust account Nasdaq rules provide that at least 90% of the gross proceeds from this offering and the sale of the private placement warrants be deposited in a trust account. Of the net proceeds of this offering and the sale of the private placement warrants, $102,000,000, or $10.20 per unit ($117,300,000 or $10.20 per unit, if the underwriters over-allotment option is exercised in full) will be placed into a trust account in the United States, with Continental Stock Transfer & Trust Company acting as trustee. These proceeds include $3,500,000 (or $4,025,000 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our franchise and income tax obligations (less up to $100,000 of interest to pay dissolution expenses), the proceeds from this offering and the sale of the private placement warrants will not be released from the trust account until the earliest of (a) the completion of our initial business combination, (b) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our second amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within nine months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by up to three months on two occasions as described in more detail in this prospectus) or (ii) with respect to any other provision relating to stockholders rights or pre-business combination activity, and (c) the redemption of our public shares if we are unable to complete our initial business combination within nine months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by up to three months on two occasions as described in more detail in this prospectus), subject to applicable law. The proceeds deposited in the Table of Contents trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. Anticipated expenses and funding sources Except as described above with respect to the payment of taxes, unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. The proceeds held in the trust account will be invested only in U.S. government securities with a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. We will disclose in each quarterly and annual report filed with the SEC prior to our initial business combination whether the proceeds deposited in the trust account are invested in U.S. government treasury obligations or money market funds or a combination thereof. Based upon current interest rates, we expect the trust account to generate approximately $102,000 of interest annually assuming an interest rate of 0.1% per year; however, we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement warrants not held in the trust account, which will be approximately $1,350,000 in working capital after the payment of approximately $650,000 in expenses relating to this offering; and any loans or additional investments from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation to advance funds or invest in us, and provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of an initial business combination. Conditions to completing our initial business combination Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm that is a member of FINRA or an independent accounting firm with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if Table of Contents there is a significant amount of uncertainty as to the value of a target s assets or prospects. There is no limitation on our ability to raise funds privately, or through loans in connection with our initial business combination. We anticipate structuring our initial business combination either (i) in such a way so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses, or (ii) in such a way so that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders, or for other reasons. However, we will only complete an initial business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of Nasdaq s 80% of net assets test. If the initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. Permitted purchases of public shares and public warrants by our affiliates If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, initial stockholders, directors, officers, advisors or their affiliates may purchase shares or public warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. There is no limit on the number of shares our initial stockholders, directors, officers, advisors or their affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. However, they have no current commitments, plans or intentions to engage in such transactions and Table of Contents have not formulated any terms or conditions for any such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Securities Exchange Act of 1934, as amended (the Exchange Act ). We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. None of the funds held in the trust account will be used to purchase shares or public warrants in such transactions prior to completion of our initial business combination. See Proposed Business Permitted purchases of our securities for a description of how our sponsor, initial stockholders, directors, officers, advisors or any of their affiliates will select which stockholders to purchase securities from in any private transaction. The purpose of any such purchases of shares could be to vote such shares in favor of the initial business combination and thereby increase the likelihood of obtaining stockholder approval of the initial business combination or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our shares of Class A common stock or warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Redemption rights for public stockholders upon completion of our initial business combination We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes, divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.20 per public share, Table of Contents without taking into account any interest earned on such funds or additional funds, if any, deposited into the trust account in connection with extensions of the period of time to consummate a business combination (as described in more detail in this prospectus). The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares held by them and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination or otherwise. We may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to either tender their certificates to our transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up to two business days prior to the vote on the proposal to approve the initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically using the Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option. The tender offer or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public stockholders to satisfy such delivery requirements. Manner of conducting redemptions We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a stockholder meeting called to approve the initial business combination or (ii) by means of a tender offer. The decision as to whether we will seek stockholder approval of a proposed initial business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval under the law or stock exchange listing requirements. Under Nasdaq rules, asset acquisitions and stock purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding common stock or seek to amend our second amended and restated certificate of incorporation would require stockholder approval. We may conduct redemptions without a stockholder vote pursuant to the tender offer rules of the SEC unless stockholder approval is required by law or stock exchange listing requirements or we choose to seek stockholder approval for business or other legal reasons. So long as we obtain and maintain a listing for our securities on Nasdaq, we will be required to comply with such rules. Table of Contents If a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other legal reasons, we will, pursuant to our second amended and restated certificate of incorporation: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Such provisions may be amended if approved by holders of a majority of our common stock entitled to vote thereon. Whether or not we maintain our registration under the Exchange Act or our listing on Nasdaq, we will provide our public stockholders with the opportunity to redeem their public shares by one of the two methods listed above. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase shares of our Class A common stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public stockholders not tendering more than a specified number of public shares, which number will be based on the requirement that we may not redeem public shares in an amount that would cause our net tangible assets to be less than $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions (so that we are not subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination. If, however, stockholder approval of the transaction is required by law or stock exchange listing requirements, or we decide to obtain stockholder approval for business or other legal reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and file proxy materials with the SEC. Table of Contents If we seek stockholder approval, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the company representing a majority of the voting power of all outstanding shares of capital stock of the company entitled to vote at such meeting. Our initial stockholders will count towards this quorum and, pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote their founder shares and any public shares purchased during or after this offering (including in open market and privately negotiated transactions) in favor of our initial business combination. For purposes of seeking approval of the majority of our outstanding shares of common stock voted, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. As a result, in addition to our initial stockholders founder shares, we would need only 3,800,001, or 38.0%, of the 10,000,000 public shares sold in this offering to be voted in favor of an initial business combination (assuming all outstanding shares are voted) in order to have our initial business combination approved (assuming the over-allotment option is not exercised). We intend to give approximately 30 days (but not less than 10 days nor more than 60 days) prior written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination. These quorums and voting thresholds, and the voting agreements of our initial stockholders, may make it more likely that we will consummate our initial business combination. Each public stockholder may elect to redeem its public shares irrespective of whether they vote for or against the proposed transaction. We may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to either tender their certificates to our transfer agent prior to the date set forth in the tender offer documents mailed to such holders, or up to two business days prior to the vote on the proposal to approve the initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically. We believe that this will allow our transfer agent to efficiently process any redemptions without the need for further communication or action from the redeeming public stockholders, which could delay redemptions and result in additional administrative cost. If the proposed initial business combination is not approved and we continue to search for a target company, we will promptly return any certificates delivered, or shares tendered electronically, by public stockholders who elected to redeem their shares. Our second amended and restated certificate of incorporation will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions (so that we are not subject to the SEC s penny Table of Contents stock rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. For example, the proposed initial business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed initial business combination. In the event the aggregate cash consideration we would be required to pay for all shares of Class A common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will not complete the initial business combination or redeem any shares, and all shares of Class A common stock submitted for redemption will be returned to the holders thereof. Limitation on redemption rights of stockholders holding 15% or more of the shares sold in this offering if we hold stockholder vote Notwithstanding the foregoing redemption rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our second amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. We believe the restriction described above will discourage stockholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public stockholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against an initial business combination if such holder s shares are not purchased by us or our management at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with an initial business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders ability to vote all of their shares (including all shares held by those stockholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Table of Contents Redemption rights in connection with proposed amendments to our certificate of incorporation Our second amended and restated certificate of incorporation will provide that any of its provisions related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the private placement of units into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein) may be amended if approved by holders of a majority of our common stock entitled to vote thereon, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of a majority of our common stock entitled to vote thereon. In all other instances, our amended and restated certificate of incorporation may be amended by holders of a majority of our outstanding common stock entitled to vote thereon, subject to applicable provisions of the Delaware General Corporation Law, or DGCL, or applicable stock exchange rules. Under our amended and restated certificate of incorporation, we may not issue additional securities that can vote on amendments to our amended and restated certificate of incorporation or on our initial business combination or that would entitle holders thereof to receive funds from the trust account. Our initial stockholders, who will collectively beneficially own 20% of our common stock upon the closing of this offering (assuming they do not purchase any units in this offering and excluding the representative shares), will participate in any vote to amend our second amended and restated certificate of incorporation and/or trust agreement and will have the discretion to vote in any manner they choose. Our sponsor, executive officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our second amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within nine months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by up to three months on up to two occasions as described in more detail in this prospectus) or (ii) with respect to any other provision relating to stockholders rights or pre-business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of Class A common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then outstanding public shares. Our sponsor, officers and directors have entered into a letter agreement with us pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and any public shares held by them in connection with the completion of our initial business combination. Table of Contents Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be used to pay amounts due to any public stockholders who exercise their redemption rights as described above under Redemption rights for public stockholders upon completion of our initial business combination. We will use the remaining funds to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our second amended and restated certificate of incorporation will provide that we will have only nine months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by up to three months on up to two occasions as described in more detail in this prospectus) to complete our initial business combination. If we are unable to complete our initial business combination within such nine-month period (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by up to three months on up to two occasions as described in more detail in this prospectus), we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our franchise and income taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within the nine-month time Table of Contents period (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by up to three months on up to two occasions as described in more detail in this prospectus). Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to any founder shares held by them if we fail to complete our initial business combination within nine months from the closing of this offering (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by up to three months on up to two occasions as described in more detail in this prospectus). However, if our initial stockholders acquire public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted nine-month time period (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by up to three months on up to two occasions as described in more detail in this prospectus). The underwriters have agreed to waive their rights to their deferred underwriting commission held in the trust account in the event we do not complete our initial business combination and subsequently liquidate and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. Ability to extend time to complete business combination If we anticipate that we may not be able to consummate our initial business combination within nine months, we may, by resolution of our board if requested by our sponsor, extend the period of time to consummate a business combination by an additional three months on up to two occasions (for a total of up to 15 months to complete a business combination as described in more detail in this prospectus), subject to the sponsor depositing additional funds into the trust account as set out below. Pursuant to the terms of our second amended and restated certificate of incorporation and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order for the time available for us to consummate our initial business combination to be extended, our sponsor or its affiliates or designees, upon five days advance notice prior to the applicable deadline, $1,000,000, or $1,150,000 if the underwriters over-allotment option is exercised in full ($0.10 per unit in either case), on or prior to the date of the applicable deadline, for the available three month extension. Any such payments would be made in the form of non-interest bearing loans. If we complete our initial business combination, we will, at the option of our sponsor, repay such loaned amounts out of the proceeds of the trust account released to us or convert a portion or all of the total loan amount into warrants at a price of $1.00 per warrant, which warrants will be identical to the Table of Contents private placement warrants. If we do not complete a business combination, we will repay such loans only from funds held outside of the trust account. Our stockholders will not be entitled to vote or redeem their shares in connection with any such extension. Furthermore, the letter agreement with our initial stockholders contains a provision pursuant to which our sponsor has agreed to waive its right to be repaid for such loans to the extent there is insufficient funds held outside of the trust account in the event that we do not complete a business combination. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. Our stockholders will be entitled to vote and redeem their shares in connection with a stockholder meeting held to approve an initial business combination or in a tender offer undertaken in connection with such an initial business combination if we propose such a business combination during any three-month extension period. Limited payments to insiders There will be no finder s fees, reimbursement, consulting fee, non-cash payments, monies in respect of any payment of a loan or other compensation paid by us to our sponsor, officers or directors, or any affiliate of our sponsor or officers prior to, or in connection with any services rendered in order to effectuate, the consummation of our initial business combination (regardless of the type of transaction that it is). However, the following payments will be made to our sponsor, officers or directors, or our or their affiliates, none of which will be made from the proceeds of this offering held in the trust account prior to the completion of our initial business combination: Repayment of up to an aggregate of $400,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; Payment to Morgan Fahimi, our Chief Financial Officer, of $10,000 per month for nine months (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by up to three months on up to two occasions as described in more detail in this prospectus), for his services commencing upon the closing of this offering. Upon completion of our initial business combination or our liquidation, we will cease paying these monthly fees; Reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; and Repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such working capital loans may be convertible into private placement-equivalent warrants at a price of $1.00 per warrant (which, for example, would result in the holders being issued 1,500,000 warrants if $1,500,000 of Table of Contents notes were so converted), at the option of the lender. Such warrants would be identical to the private placement warrants, including as to exercise price, exercisability and exercise period of the underlying warrants. The terms of such working capital loans by our sponsor or its affiliates, or our officers and directors, if any, have not been determined and no written agreements exist with respect to such loans. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliates. Audit Committee We will establish and maintain an audit committee, which will be composed entirely of independent directors to, among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section of this prospectus entitled Management Committees of the Board of Directors Audit Committee. Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business with which we have entered into a written letter of intent, confidentiality or similar agreement or business combination agreement, reduce the amount of funds in the trust account to below the lesser of (i) $10.20 per public share and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.20 per share due to reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. However, we have not asked our sponsor to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that our sponsor s only assets are securities of our company. Therefore, we cannot assure you that our sponsor would be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses. Conflicts of interest Our officers and directors may become officers or directors of any other blank check company prior to completion of our initial business combination. Our second amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity Table of Contents is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and to the extent the director or officer is permitted to refer that opportunity to us without violating another legal obligation. We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our initial business combination. Table of Contents SUMMARY OF RISK FACTORS We are a newly formed company that has conducted no operations and has generated no revenues. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision whether to invest in our securities, you should take into account not only the background of our management team, but also the special risks we face as a blank check company. This offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see the section of this prospectus entitled Proposed Business Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419. You should carefully consider these and the other risks set forth in the section of this prospectus entitled Risk Factors. We are a newly incorporated company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. Past performance by our management team may not be indicative of future performance of an investment in the Company. Our public stockholders may not be afforded an opportunity to vote on our proposed initial business combination, which means we may complete our initial business combination even though a majority of our public stockholders do not support such a combination. Your only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash, unless we seek stockholder approval of such business combination. If we seek stockholder approval of our initial business combination, our sponsor has agreed to vote in favor of such initial business combination, regardless of how our public stockholders vote. The ability of our public stockholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combination with a target. The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure. The requirement that we complete our initial business combination within the prescribed time frame may give potential target businesses leverage over us in negotiating a business combination and may limit the time we have in which to conduct due diligence on potential business combination targets, in particular as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our stockholders. Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the novel coronavirus ( COVID-19 ) outbreak. As the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets. This could increase the cost of our initial business combination and could even result in our inability to find a target or to consummate an initial business combination. Resources could be wasted in researching business combinations that are not completed, which could materially adversely affect subsequent attempts to locate and acquire or merge with another business. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share, or less than such amount in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. Table of Contents Rising inflation may result in increased costs of operations and negatively impact the credit and securities markets generally, which could have a material adverse effect on our results of operations and the market price of our common stock. If we seek stockholder approval of our initial business combination, our sponsor, directors, officers, advisors and their affiliates may elect to purchase shares or warrants from public stockholders, which may influence a vote on a proposed business combination and reduce the public float of our Class A common stock. If a stockholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination or fails to comply with the procedures for tendering its shares, such shares may not be redeemed. You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. To liquidate your investment, therefore, you may be forced to sell your public shares or warrants, potentially at a loss. Nasdaq may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities and subject us to additional trading restrictions. You will not be entitled to protections normally afforded to investors of many other blank check companies. If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per share redemption amount received by stockholders may be less than $10.20 per share. Our directors may decide not to enforce the indemnification obligations of our sponsor, resulting in a reduction in the amount of funds in the trust account available for distribution to our public stockholders. Our officers and directors will allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial business combination. Because of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share on our redemption of our public shares, or less than such amount in certain circumstances, and our warrants will expire worthless. If the net proceeds of this offering and the sale of the private placement warrants not being held in the trust account are insufficient to allow us to operate for at least the next nine months (or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination by up to three months on up to two occasions as described in more detail in this prospectus), we may be unable to complete our initial business combination, in which case our public stockholders may only receive $10.20 per share, or less than such amount in certain circumstances, and our warrants will expire worthless. Changes in laws or regulations or in how such laws or regulations are interpreted or applied, or a failure to comply with any laws, regulations, interpretations or applications, may adversely affect our business, including our ability to negotiate and complete an initial business combination. The SEC has issued proposed rules relating to certain activities of special purpose acquisition companies ( SPACs ). Certain of the procedures that we, a potential business combination target, or others may determine to undertake in connection with such proposals may increase our costs and the time needed to complete our initial business combination and may constrain the circumstances under which we could complete an initial business combination. The need for compliance with the SPAC Rule Proposals may cause us to liquidate the funds in the Trust Account or liquidate our company at an earlier time than we might otherwise choose. Table of Contents If we are deemed to be an investment company for purposes of the Investment Company Act, we would be required to institute burdensome compliance requirements and our activities would be severely restricted. As a result, in such circumstances, unless we are able to modify our activities so that we would not be deemed an investment company, we would expect to abandon our efforts to complete an initial business combination and instead to liquidate the Company. To mitigate the risk that we might be deemed to be an investment company for purposes of the Investment Company Act, we may, at any time, instruct the trustee to liquidate the securities held in the Trust Account and instead to hold the funds in the Trust Account in cash until the earlier of the consummation of our initial business combination or our liquidation. As a result, following the liquidation of securities in the Trust Account, we would likely receive minimal interest, if any, on the funds held in the Trust Account, which would reduce the dollar amount our public stockholders would receive upon any redemption or liquidation of the Company. Were we considered to be a foreign person, we might not be able to complete an initial business combination with a U.S. target company if such initial business combination is subject to U.S. foreign investment regulations and review by a U.S. government entity such as the Committee on Foreign Investment in the United States ( CFIUS ), or ultimately prohibited. The Excise Tax included in the Inflation Reduction Act of 2022 may decrease the value of our securities following our initial business combination or hinder our ability to consummate an initial business combination. We may engage in a business combination with one or more target businesses that have relationships with entities that may be affiliated with our sponsor, officers, directors or existing holders which may raise potential conflicts of interest. The other risks and uncertainties discussed in Risk Factors and elsewhere in this prospectus. Table of Contents SUMMARY FINANCIAL DATA The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. September 30, 2022 Actual As Adjusted Balance Sheet Data: Working (deficiency) capital(1) $ (374,938 ) $ 975,062 Total assets(2) 424,619 103,774,619 Total liabilities(3) 413,841 4,645,841 Value of common stock subject to possible redemption(4) 91,837,935 Stockholder s equity(5) $ 10,778 $ 7,290,843 (1) The as adjusted calculation includes $1,350,000 of cash held outside the trust account, minus $374,938 of actual working capital deficiency at September 30, 2022. (2) The as adjusted calculation equals $102,000,000 of cash held in trust from the proceeds of this offering and the sale of the private placement warrants, plus $1,350,000 in cash held outside the trust account, plus $424,619 of actual assets at September 30, 2022. (3) The as adjusted calculation equals $3,500,000 of deferred underwriting commissions, assuming the over-allotment option is not exercised, $732,000 of private placement warrant liability, and actual total liabilities of $413,841 at September 30, 2022. (4) The as adjusted calculation equals the net proceeds from this offering less $7,150,000 offering costs allocated to additional paid in capital, attributable to 10,000,000 Class A common stock subject to possible redemption, multiplied by the proportional fair value allocation of the public shares. (5) Excludes 10,000,000 shares of Class A common stock purchased in the public market which are subject to redemption in connection with our initial business combination. The as adjusted calculation equals the as adjusted total assets, less the as adjusted total liabilities, less the value of shares of common stock that may be redeemed in connection with our initial business combination ($10.20 per share). The as adjusted information gives effect to the sale of the units we are offering, and the sale of the private placement warrants, including the application of the related gross proceeds and the payment of the estimated remaining costs from such sale. The as adjusted total assets amount $102,000,000 to be held in the trust account (or $117,300,000 if the over-allotment option is exercised in full) which, except for limited situations described in this prospectus, will be available to us only upon the consummation of a business combination within the time period described in this prospectus. If a business combination is not so consummated, the trust account, less amounts we are permitted to withdraw from interest earned on the funds in the trust account as described in this prospectus, will be distributed solely to our public stockholders (subject to our obligations under Delaware law to provide for claims of creditors). Table of Contents
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+S-1 1 metas1.htm As filed with U.S. Securities and Exchange Commission on May 13, 2022. Registration No. 333- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ___________________________ FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ___________________________ METAVERSE ACQUISITION CORPORATION (Exact name of registrant as specified in its charter) ___________________________ Delaware 6770 85-2918330 (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) 295 Madison Avenue, 12th Floor New York City, NY 10017 Telephone: (917) 289-0288 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) ___________________________ Chris Ensey, Co-Chief Executive Officer Aaron McDonald, Co-Chief Executive Officer 295 Madison Avenue, 12th Floor New York City, NY 10017 Telephone: (917) 289-0288 (Name, address, including zip code, and telephone number, including area code, of agent for service) ___________________________ Copies to: Ralph V. De Martino, Esq. Cavas Pavri, Esq. ArentFox Schiff LLP 1717 K Street NW Washington, DC 20006 Telephone: (202) 778-6400 Facsimile: (202) 778-6460 Barry Grossman, Esq. Anthony Ain, Esq. Ellenoff Grossman & Schole LLP 1345 Avenue of the Americas New York, NY 10105 Telephone: (212) 370-1300 Facsimile: (212) 370-7889 ___________________________ Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act: Large accelerated filer Accelerated filer Non-accelerated filer S Smaller reporting company S Emerging growth company S If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. ___________________________ The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED MAY 13, 2022 Metaverse Acquisition Corporation $150,000,000 15,000,000 Units ___________________________ Metaverse Acquisition Corporation is a newly organized blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. While we may pursue an initial business combination target in any business, industry or geographical location, we intend to focus our search on businesses that are focused on opportunities within the metaverse arena. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one share of our common stock, one right and one redeemable warrant. Each right entitles the holder thereof to receive one-tenth (1/10) of one share of common stock upon the consummation of an initial business combination, so you must hold rights in multiples of 10 in order to receive shares for all of your rights upon closing of a business combination. Each warrant entitles the holder thereof to purchase one share of our common stock at a price of $11.50 per share, subject to adjustment as described in this prospectus. The warrants will become exercisable on the later of 30 days after the completion of our initial business combination and 12 months from the closing of this offering, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. We have also granted the underwriters a 30-day option to purchase up to an additional 2,250,000 units to cover over-allotments, if any. We will provide our public stockholders with the opportunity to redeem all or a portion of their shares of our common stock upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below as of two business days prior to the consummation of our initial business combination, including interest (which interest shall be net of taxes payable) divided by the number of then outstanding shares of common stock that were sold as part of the units in this offering, which we refer to collectively as our public shares, subject to the limitations described herein. If we are unable to complete our business combination within 9 months from the closing of this offering, or up to 15 months from the closing of this offering if we extend the period of time to consummate a business combination (the combination period ), we will redeem 100% of the public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (less up to $100,000 of interest to pay dissolution expenses and which interest shall be net of taxes payable) divided by the number of then outstanding public shares, subject to applicable law and as further described herein. Our sponsor, I-B Good Works 3, LLC (which we refer to as our sponsor throughout this prospectus) has committed to purchase an aggregate of 455,000 units (which remain unchanged if the underwriters over-allotment option is exercised in full) at a price of $10.00 per unit ($4,550,000 in the aggregate, which remain unchanged if the underwriters over-allotment option is exercised in full) in a private placement that will close simultaneously with the closing of this offering. We refer to these units throughout this prospectus as the private placement units. The private placement units are identical to the units sold in this offering except as otherwise described in this prospectus. Prior to this offering, our initial stockholders purchased 5,002,500 shares of common stock (up to 652,500 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised), which we also refer to as founder shares. Currently, there is no public market for our units, common stock, rights or warrants. We intend to apply to list our units, common stock, rights and warrants on The Nasdaq Global Market, or Nasdaq, under the symbols U, C, R, and W respectively. We expect that our units will be listed on Nasdaq on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on Nasdaq. The common stock, rights and warrants comprising the public units will begin separate trading on the 52nd day following the date of this prospectus unless I-Bankers informs us of their decision to allow earlier separate trading, subject to our filing a Current Report on Form 8-K with the Securities and Exchange Commission, or the SEC, containing an audited balance sheet reflecting our receipt of the gross proceeds of this offering and issuing a press release announcing when such separate trading will begin. At the time that the common stock, rights and warrants comprising the public units begin separate trading, holders will hold the separate securities and no longer hold units (without any action needing to be taken by the holders), and the units will no longer trade. Once the securities comprising the public units begin separate trading, we expect that the common stock, rights and warrants will be listed on Nasdaq under the symbols C, R, and W respectively. We are an emerging growth company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 27 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 150,000,000 Underwriting discounts and commissions(1)(2)(3) $ 0.03 $ 450,000 Proceeds, before expenses, to us $ 9.97 $ 149,550,000 ____________ (1) The underwriters will receive compensation in addition to the underwriting discount. See Underwriting for a description of compensation and other items of value payable to the underwriters. (2)We will also pay $[_____] to [ ], our qualified independent underwriter. We have also agreed to reimburse the underwriters for all road show expenses and legal costs and other expenses, as set forth in the section titled Underwriting. (3)Please see the section titled Underwriting (Conflicts of Interest) for further information relating to the underwriting arrangements agreed to between us and the underwriters in this offering. Of the proceeds we receive from this offering and the sale of the private placement units described in this prospectus, $150 million or $172.5 million if the underwriters over-allotment option is exercised in full ($10.00 per unit in either case), will be deposited into a trust account with Continental Stock Transfer & Trust Company acting as trustee. Except with respect to interest earned on the funds in the trust account that are released to us to pay our taxes, if any, these funds will not be released from the trust account until the earliest of (i) the completion of our initial business combination, (ii) the redemption of any public shares properly tendered in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within the combination period or (B) with respect to any other provision relating to stockholders rights or pre-business combination activity, and (iii) the redemption of all of our public shares if we are unable to complete our business combination within the combination period, subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2022. Sole Book-Running Manager I-Bankers Securities, Inc. , 2022 TABLE OF CONTENTS Page SUMMARY 1
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+SUMMARY OF THE PROSPECTUS 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001925605_qualtek_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001925605_qualtek_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
--- /dev/null
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@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001925647_qualtek_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001925647_qualtek_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001925647_qualtek_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001925814_qualtek_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001925814_qualtek_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001925814_qualtek_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001925905_qualtek_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001925905_qualtek_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001925905_qualtek_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001925913_qualtek_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001925913_qualtek_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001925913_qualtek_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001925926_forest_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001925926_forest_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..c4dc5b9f14d181ae71b9d767a2d14096b8a651a6
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001925926_forest_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary Transfer of Cash to and from Our Post-Combination Organization If We Acquire a Company Based in China (Post-Business Combination) and Risk Factors Risks Related to Acquiring or Operating Businesses in the PRC PRC governmental control of currency conversion may limit the ability of our operating companies in China to utilize their revenues effectively and affect the value of your investment. Pursuant to the Holding Foreign Companies Accountable Act, or the HFCA Act, the PCAOB issued a Determination Report on December 16, 2021 which found that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in (1) mainland China of the PRC because of a position taken by one or more authorities in mainland China and (2) Hong Kong, a Special Administrative Region and dependency of the PRC, because of a position taken by one or more authorities in Hong Kong. In addition, the PCAOB s report identified the specific registered public accounting firms which are subject to these determinations. Furthermore, on June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act ( AHFCAA ), which, if signed into law, would amend the HFCA Act and require the SEC to prohibit an issuer s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three consecutive years. Consequently, as early as 2024, our securities will be prohibited from trading on a national exchange or over-the-counter under the AHFCAA if the Public Company Accounting Oversight Board, or the PCAOB, is unable to inspect or fully investigate our independent registered public accounting firm for three consecutive years beginning in 2021, and as a result the Nasdaq Global Market may make a determination to delist our securities. However, our auditor, UHY LLP, is a United States accounting firm based in New York City and is subject to regular inspection by the PCAOB. UHY LLP is not headquartered in mainland China or Hong Kong and was not identified in the Determination Report as a firm subject to the PCAOB s determinations. As a special purpose acquisition company, our current business activities only involve preparation of this offering and will involve searching for targets and consummation of a business combination following this offering. Our books and records prior to the consummation of a business combination are maintained by our bookkeeper residing in U.S. In addition, we affirmatively exclude any target company of which financial statements are audited by an accounting firm that the PCAOB is unable to inspect for two consecutive years at the time of our business combination. Notwithstanding the foregoing, in the event that we decide to consummate our initial business combination with a target business based in or primarily operating in China, if there is any regulatory change which prohibits the independent accountants from providing audit documentations located in mainland China or Hong Kong to the PCAOB for inspection or investigation or the PCAOB expands the scope of the Determination Report so that the target company or the combined company is subject to the HFCA Act, as the same may be amended, you may be deprived of the benefits of such inspection which could result in limitation or restriction to our access to the U.S capital markets and trading of our securities on a national securities exchange or in the over-the-counter trading market in the U.S. may be prohibited, under the HFCA Act. If the AHFCAA is signed in to law and the combined company s auditor cannot be inspected by the PCAOB for two consecutive years, the trading of the securities on any U.S. national securities exchanges, as well as any over-the-counter trading in the U.S., will be prohibited. See Risk Factors Risks Related to Acquiring or Operating Businesses in the PRC Though we affirmatively exclude as an initial business combination target any company with financial statements audited by an accounting firm that the PCAOB is unable to inspect for two consecutive years, we cannot assure you that certain existing or future U.S. laws and regulations may restrict or eliminate our ability to complete a business combination with certain companies, particularly those target companies in China. Prior to this offering, there has been no public market for our units, ordinary shares, rights or warrants. We have applied to list our units on the NASDAQ Global Market, or NASDAQ, under the symbol FOACU on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on the NASDAQ. The ordinary shares, rights and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Ladenburg Thalmann & Co. Inc., the representative of the underwriters of this offering, informs us of its decision to allow earlier separate trading, subject to our filing a Current Report on Form 8-K with the Securities and Exchange Commission, or the SEC, containing an audited balance sheet reflecting our receipt of the gross proceeds of this offering and issuing a press release announcing when such separate trading will begin. Once the securities comprising the units begin separate trading, we expect that the ordinary shares, rights and warrants will be listed on NASDAQ under the symbols FOAC, FOACR and FOACW, respectively. Table of Contents TABLE OF CONTENTS Page SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001925957_qualsat_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001925957_qualsat_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001925957_qualsat_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001925963_nx_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001925963_nx_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001925963_nx_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001925983_concurrent_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001925983_concurrent_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001925983_concurrent_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001925989_advantek_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001925989_advantek_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001925989_advantek_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001926451_t20_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001926451_t20_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..b895d021b0595ac001b11605cda0737f25d5571b
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001926451_t20_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following summary is qualified in its entirety by, and should be read in conjunction with, the more detailed information and financial statements included elsewhere in this prospectus. In addition to this summary, we urge you to read the entire prospectus carefully, especially the risks of investing in our securities, discussed under "Risk Factors," before deciding whether to buy our securities. Overview We develop, design, and build globally relevant power generation solutions, supporting our clients with the transition to cleaner energy and developing our own energy focused projects. We are trusted to solve complex energy transition challenges through ingenious, tailored solutions. We create new growth opportunities for our clients, partners, and employees in the communities where they live and work, while delivering increased shareholder value. We provide contracting (service and maintenance, plan operation, repair and upgrade and new installations), consulting (audits and compliance, design and engineering, procurement and project management) and construction (renovation and refurbishment, temporary support services, fit-outs and new building) services in the building services and power generation sectors. We have historically concentrated operations in Papua New Guinea (PNG) and have seven years of operating experience delivering significant energy and construction focused projects, including a 45-megawatt (MW) gas-fired power station which delivers electricity for our client and the national utility (PNG Power Limited) to feed into the Port Moresby power grid, greatly reducing the utility s reliance on diesel generation. We believe that our proprietary power generation technology, specifically our Power Island Floating Storage, Regasification, and Power Generation (Power Island FSRP) technology has widespread applicability to, and significant expansion opportunities for, both regional and global communities, especially in island and coastal regions, and is expected to be a key pillar of our sustainable energy transition focus. The engineering designs for this have all been reviewed and verified by an independent engineer and we are in the process of protecting the related intellectual property. Our energy business has delivered aggregate revenues of $89 million and $16.7 million in net income over the last three fiscal years ended December 31, 2021. For the six months ending June 30, 2022, our energy business delivered $4.3 million revenue and $0.9 million in net income. We have an established track record of successfully working with major clients, suppliers, and partners, such as the Bank of South Pacific, Exxon Mobil Corporation, Solar Turbines Incorporated, which is a wholly-owned subsidiary of Caterpillar Inc., Hitachi ABB Power Grids, and Emerson Electric Co., as well as state owned enterprises, sovereign wealth funds, and the PNG national utility. Accordingly, we have a strong local presence in PNG and believe that we are well positioned to capitalize on the increasing economic development, urbanization, and demand for electrification across PNG, the wider APAC region, and beyond. We currently have a strong pipeline of multiyear, national PNG projects, which we expect will deliver significant continued earnings growth for our business. The time between contract award, notice to proceed, and completion varies by customer and project. As we secure projects, we build our backlog of unbilled revenue and as we execute on projects, we deplete our backlog of unbilled revenue. New and continuing projects from existing customers and business development efforts fuel the growth of our backlog. As of December 31, 2021, we had $258.7 million of backlog representing a 170% increase from our backlog of $95.7 million as of December 31, 2020 driven primarily by the signing of the design, supply, and construction contracts for a 66 MW gas-fired power plant using the local liquefied natural gas (LNG) supply in the PNG Hela region. We have been directed by the PNG government National Executive Council to hold discussions and negotiations for a PNG wide deployment of our Power Island FSRP technology, which would provide a floating LNG power generation solution, to deliver the additional capacity needed to meet electrification targets throughout PNG, including to support existing and new mining projects. Our backlog at June 30, 2022 was $373.0 million, a 44% increase from December 31, 2021, driven by the signing of the O&M contracts for the Hela Project. Table of Contents TABLE OF CONTENTS Page ABOUT THIS PROSPECTUS 1 PROSPECTUS SUMMARY 3
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001927309_alkaid_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001927309_alkaid_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001927309_alkaid_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001927596_whale_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001927596_whale_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..e58268858229962a67620a037e4e605a5eea042c
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001927596_whale_prospectus_summary.txt
@@ -0,0 +1 @@
+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Definitions Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated certificate of incorporation are to our amended and restated certificate of incorporation to be in effect upon completion of this offering; BTIG is to BTIG, LLC, an underwriter of this offering; common stock are to our Class A common stock and our Class B common stock; directors are to our current directors and our director nominees named in this prospectus; founder shares are to shares of our Class B common stock initially purchased by our sponsor in a private placement prior to this offering and our shares of Class A common stock that will be issued upon conversion thereof as provided herein; initial stockholders are to our sponsor and the other holders of our founder shares prior to this offering (if any); letter agreement are to the letter agreement, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team are to our directors and officers; private placement warrants are to the warrants sold to our sponsor and the underwriters in a private placement simultaneously with the closing of this offering; public shares are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public stockholders are to the holders of our public shares, including our sponsor, directors and officers to the extent our sponsor, directors or officers purchase public shares, provided their status as a public stockholder shall only exist with respect to such public shares; special advisors are to Ralph E. Shayne, Christopher E. Campbell and John Ventura, who will serve as our special advisors; sponsor are to Whale Point Sponsor LLC, a Delaware limited liability company; warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); and we, us, our or our company are to Whale Point Acquisition Corp., a Delaware corporation. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option and the forfeiture by our sponsor of 562,500 founder shares. General We are a newly formed blank check company incorporated as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. Although we may pursue an initial business combination target in any sector, industry or geographic location, we currently intend to focus our efforts on identifying business combination targets in the FinTech TABLE OF CONTENTS The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED JULY 20, 2022 $150,000,000 Whale Point Acquisition Corp. 15,000,000 Whale Point Acquisition Corp. is a newly incorporated blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. While we may pursue an initial business combination target in any industry or geographic location (subject to certain limitations described in this prospectus), we currently intend to focus our efforts on identifying business combination targets in the financial technology ( FinTech ) sector, including banking technology ( BankTech ), real estate and mortgage technology ( PropTech ), insurance technology ( InsurTech ) and other technology-enabled platforms serving the financial services industry. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one share of our Class A common stock and one-half of one redeemable warrant. Each whole warrant entitles the holder thereof to purchase one share of our Class A common stock at a price of $11.50 per share, subject to adjustment as described in this prospectus, and only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. The warrants will become exercisable on the later of 30 days after the completion of our initial business combination and twelve months from the closing of this offering, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation, as described in this prospectus. Subject to the terms and conditions described in this prospectus, we may redeem the warrants once the warrants become exercisable. We have also granted the underwriters a 45-day option to purchase up to an additional 2,250,000 units to cover over-allotments, if any. We are an emerging growth company and smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves risks. See Risk Factors beginning on page 40. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Public offering price $ 10.00 $ 150,000,000 Underwriting discounts and commissions(1) $ 0.60 $ 9,000,000 Proceeds, before expenses, to us $ 9.40 $ 141,000,000 (1) $0.20 per unit sold in the base offering, or $3,000,000 in the aggregate is payable upon the closing of this offering. Includes $0.40 per unit, or $6,000,000 in the aggregate, payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States and released to the underwriters only upon the completion of an initial business combination. If the underwriters over-allotment option is exercised in full, $0.60 per over-allotment unit, or up to an additional $1,350,000 or $7,350,000 in the aggregate, will be deposited into the trust account and released to the underwriters only upon the completion of an initial business combination. Does not include certain fees and expenses payable to the underwriters in connection with this offering. See also Underwriting for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of private placement warrants described in this prospectus, $153,000,000, or $175,950,000 if the underwriters over-allotment option is exercised in full ($10.20 per unit, in either case, which does not include up to an additional $0.20 per unit in the aggregate which may be added if we choose to extend the time to complete a business combination in certain instances as further described in this prospectus), will be deposited into a U.S.-based trust account at J.P. Morgan Chase Bank, N.A. with Continental Stock Transfer & Trust Company acting as trustee. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, if any, the funds held in the trust account will not be released from the trust account until the earliest to occur of: (1) our completion of an initial business combination; (2) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we have not consummated an initial business combination within 18 months from the closing of this offering (or up to 24 months from the closing of this offering if we extend the time to complete a business combination as described in this prospectus) or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity; and (3) the redemption of our public shares if we have not completed an initial business combination within 18 months from the closing of this offering (or up to 24 months from the closing of this offering if we extend the time to complete a business combination as described in this prospectus), subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. The underwriters are offering the units for sale on a firm commitment basis. Delivery of the units will be made on or about , 2022. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Sole Bookrunner BTIG The date of this prospectus is , 2022. TABLE OF CONTENTS sector, including BankTech, PropTech, InsurTech and other technology-enabled platforms serving the financial services industry. We believe our management team s extensive experience and relationships with leading businesses, founders, executives, investors and regulators in the FinTech and financial services industries will give us a competitive advantage in pursuing a broad range of opportunities in many industries within the FinTech sector. Our sourcing efforts will primarily be concentrated in the United States where we can leverage our extensive network to expand our pool of opportunities. Our management team has decades of experience as investors and operating executives, with demonstrated success investing in and growing financial services businesses. We have extensive insight into industry and acquisition trends, and we have a vast network of industry relationships to capitalize on these trends. We understand the challenges that the FinTech and financial services industries currently face and believe our team can not only identify a suitable business combination target, but also assist that business in finding opportunities to maximize growth and profitability through strategic plans or acquisitions. Additionally, our special advisors have diverse and additive experiences and networks, enhancing our ability to successfully execute an initial business combination. Our company is led by Denny Kim, our Chief Executive Officer, and Dennis Klaeser, our Chief Financial Officer, and further comprised of distinguished directors and special advisors who have expertise in the financial services sector. We believe our experienced team will be a preferred partner to target FinTech companies looking for public company value creation, capital formation from private and public financial services investors, platform scaling through organic growth and M&A, brand strategy and marketing, and extensive experience in government regulation. Members of our management team bring successful track records of investing in, operating, raising capital, creating, governing and advising a wide range of world class financial services companies in the public and private markets. Our competitive advantage in pursuing a business combination will be driven by the specialized expertise in financial services, breadth of our extensive network and successful track record of our team. We believe that we are well-suited to identify a strong business combination target within the FinTech sector and can add significant value to potential business combination targets as they navigate the traditional financial services industry, an industry where our management team has specialized expertise. We further believe that privately held FinTech companies with established and resilient business models would benefit from access to the public capital markets, as well as the financial, operational, regulatory and marketing expertise that our management team can offer. Our Management Team Denny Kim, our Chief Executive Officer and one of our directors, has spent the majority of his 20-year career evaluating and investing in financial services companies across sub-sectors, including banking, FinTech, insurance, insurance services, specialty finance and wealth management. Over the course of his private equity career, Mr. Kim executed the acquisition of more than $70 billion in assets across these financial services sub-sectors and the capital raising of more than $2 billion of equity from private institutional investors for private equity fund commitments and co-investment opportunities. Mr. Kim is the Founder of Whale Point Capital LLC, a newly established independent sponsor firm focused on providing growth capital to financial services companies. Since 2020, he has served as a member of the board of directors of Sterling Bancorp Inc. (NASDAQ: SBT), where he is Chairman of the Asset-Liability Committee and serves as a member of the Nominating & Corporate Governance Committee, Executive Compensation Committee, Ethic & Compliance Committee and Risk Committee. He is also the Managing Principal of 7911 Partners LLC, a private investment and advisory firm he founded in 2019. Among its various engagements, Mr. Kim advised Gemspring Capital, a middle-market private equity firm with $1.5 billion in assets under management ( AUM ), from 2020 to 2021, where he sourced and evaluated investments across the financial services spectrum. Prior to his current roles, Mr. Kim was a founding member of WL Ross & Co. s financial services investing team. From 2010 to 2018, he was a senior investment professional and Investment Committee member at WL Ross & Co., a private equity firm founded by former U.S. Commerce Secretary Wilbur L. Ross, where he specialized in financial services investments. During his tenure, WL Ross & Co. grew its AUM to more than $8 billion and established itself as one of the preeminent private equity investors in the financial services space. Most notably, Mr. Kim led WL Ross & Co. s anchor investment in Talmer Bancorp, Inc. ( Talmer ), where he worked closely with Dennis L. Klaeser and David T. Provost, later joining TABLE OF CONTENTS We will provide our public stockholders with the opportunity to redeem all or a portion of their shares of our Class A common stock upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below calculated as of two business days prior to the completion of our initial business combination, including interest (which interest shall be net of taxes payable thereon), divided by the number of then issued and outstanding shares of our Class A common stock that were sold as part of the units in this offering, which we refer to collectively as our public shares throughout this prospectus, subject to the limitations described herein. If we have not completed our initial business combination within 18 months from the closing of this offering (or up to 24 months from the closing of this offering if we extend the time to complete a business combination as described in this prospectus) or during any extended time that we have to consummate a business combination as a result of a stockholder vote to amend our amended and restated certificate of incorporation (any extension as a result of such an amendment, a Stockholder Approved Extension Period ), we will redeem 100% of our public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (less up to $100,000 of interest to pay dissolution expenses and which interest shall be net of taxes payable thereon), divided by the number of then issued and outstanding public shares, subject to applicable law and as further described herein. Our sponsor, Whale Point Sponsor LLC, a Delaware limited liability company (which we refer to as our sponsor throughout this prospectus), has committed to purchase an aggregate of 7,500,000 warrants (or 7,950,000 warrants if the underwriters over-allotment option is exercised in full) at a price of $1.00 per warrant (for an aggregate of $7,500,000, or $7,950,000 if the underwriters over-allotment option is exercised in full), and the underwriters have committed to purchase an aggregate of 750,000 warrants (which is not subject to increase if the underwriters over-allotment option is exercised), also at a price of $1.00 per warrant (for an aggregate of $750,000), in each case pursuant to a written agreement in a private placement that will close simultaneously with the closing of this offering. We refer to warrants being purchased by our sponsor and the underwriters which are described above throughout this prospectus as the private placement warrants. Each private placement warrant entitles the holder thereof to purchase one share of Class A common stock at $11.50 per share, subject to adjustment as provided herein. If we anticipate that we may not be able to consummate our initial business combination within 18 months from the closing of this offering, we may, at our sponsor s option, extend the period of time to consummate a business combination up to two times without stockholder approval, each for an additional three months (for a total of up to 24 months to complete a business combination) (each such three-month period, a Funded Extension Period ), so long as our sponsor and/or its affiliates or designees deposit into the trust account: (i) with respect to a single Funded Extension Period, an additional $0.10 per unit (for an aggregate of $1,500,000, or $1,725,000 if the underwriters over-allotment option is exercised in full) (an Extension Payment ), and (ii) with respect to two consecutive Funded Extension Periods, an Extension Payment prior to each Funded Extension Period, or $0.20 per unit in the aggregate (for an aggregate of $3,000,000, or $3,450,000 if the underwriters over-allotment option is exercised in full), upon five days advance notice prior to the applicable deadline pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company. Our public stockholders will not be entitled to vote or redeem their shares in connection with any Funded Extension Periods. As a result, we may affect such an extension even if a majority of our public stockholders do not support such an extension and none of our public stockholders will be able to redeem their shares in connection with such an extension. This feature is different than the traditional special purpose acquisition company structure, in which any extension of the company s period to complete a business combination requires a vote of the company s stockholders and such stockholders have the right to redeem their public shares in connection with such vote (although an extension without depositing additional funds into the trust account could still be pursued in the manner available in the traditional special purpose acquisition company structure). Our initial stockholders currently hold 4,312,500 shares of our Class B common stock (which we refer to as founder shares as further described herein), up to 562,500 of which are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised. The shares of our Class B common stock will automatically convert into shares of Class A common stock at the time of our initial business combination on a one-for-one basis, subject to adjustment as provided herein. In the case that additional shares of Class A common stock, or equity-linked securities (as described herein), are TABLE OF CONTENTS its board of directors and serving on its Compensation Committee as well as its Nominating & Corporate Governance Committee. During WL Ross & Co. s investment period until its final exit in 2015, Talmer became the fastest growing bank coming out of the U.S. financial crisis through the acquisition of numerous failed and distressed banks and ultimately became one of WL Ross & Co. s most successful financial service investments. Prior to WL Ross & Co., Mr. Kim worked at J.C. Flowers & Co., a private equity firm dedicated to investing globally in the financial services industry that grew its AUM to more than $7 billion during his tenure. Mr. Kim began his career at Credit Suisse First Boston s Investment Banking Division, where he advised on mergers, acquisitions and capital raising initiatives for financial institutions. He has also been a board observer of Sun Bancorp, Inc. Mr. Kim earned a Bachelor of Arts from Northwestern University and a Master of Business Administration from the Tuck School of Business at Dartmouth. Dennis L. Klaeser, our Chief Financial Officer who will also be appointed to our board of directors as of the effective date of the registration statement of which this prospectus forms a part, played a key leadership role in growing Talmer (formerly known as First Michigan Bank) from a $100 million, single branch, Michigan-based bank in 2010 into TCF Financial Corporation ( TCF ), a $48 billion bank that was the 27th largest in the United States in 2020. Mr. Klaeser then played a key role in TCF s sale to Huntington Bancshares Inc. (NASDAQ: HBAN) in 2021, which created a top-10 U.S. regional bank. He joined Talmer in 2010 to execute a business plan to acquire failed and distressed banks in the Midwest and ultimately deploy $400 million of capital commitments raised from private and public market investors. From 2010 to 2015, Talmer completed 10 bank acquisitions, including four FDIC-assisted acquisitions, five acquisitions from bank holding company bankruptcies and one open bank acquisition. Talmer completed its $200 million initial public offering in 2014, which raised approximately $50 million of incremental growth capital and provided $150 million of liquidity to its investors and, in 2015, completed the buy-out of WL Ross & Co. s remaining stake in Talmer. Mr. Klaeser was a key member of the teams that negotiated the merger of Talmer ($7 billion in assets) and Chemical Financial Corporation ( CFC ) ($9 billion) in 2016, negotiated the merger of Chemical Financial ($22 billion) and TCF ($24 billion) in 2020 and advised on the sale of TCF ($48 billion) to HBAN ($120 billion) in 2021. Investors who remained invested during Mr. Klaeser s tenure with Talmer achieved more than four times return on their original investment from 2010 to 2021. From 2019 to 2020, Mr. Klaeser was Chief Financial Officer of TCF and a member of its bank subsidiary s board of directors. From 2016 to 2019, he served as Chief Financial Officer of CFC, which merged with TCF in August 2019. From 2010 to 2016, Mr. Klaeser served as Chief Financial Officer of Talmer, which was sold to CFC in August 2016. From 2009 to 2010, he was a senior Midwest bank analyst with Raymond James and, from 2003 to 2009, he was Chief Financial Officer of PrivateBancorp, Inc. and a member of the board of directors of The PrivateBank. From 2000 to 2002, Mr. Klaeser was Managing Director and Head of the Financial Institutions Group for Anderson Corporate Finance, a division of Arthur Andersen LLP, where he was responsible for advising financial institutions on complex merger and acquisition transactions, restructuring and divestures. Mr. Klaeser also spent seven years as an investment banker and was head of the Financial Institutions Group at EVEREN Securities, where he managed a variety of initial public offerings, capital raises and merger and acquisition assignments with banks, specialty finance and mortgage companies. Mr. Klaeser currently serves on the board of directors of Old Second Bancorp, Inc. (NASDAQ: OSBC) and the Board of Trustees for Lawrence University. Mr. Klaeser earned a Bachelor of Arts from Lawrence University, a Master of Business Administration from the Kellogg School of Management at Northwestern University and Master of Arts degrees in Public Policy and Social Service Administration from The University of Chicago. Our Directors Our director nominees have a diverse set of experiences, across a number of industries and transactions. Our director nominees are David T. Provost, Saul I. Sanders and Jennifer M. Farrelly, each of whom we expect to be independent directors upon consummation of this offering. David T. Provost has agreed to serve on our board of directors upon the effective date of the registration statement of which this prospectus forms a part. Mr. Provost currently serves as an advisor to Huntington Bancshares Incorporated ( HBAN ), a multi-state diversified regional bank holding company. Mr. Provost was formerly Chief Executive Officer of TCF and a member of TCF s board of directors until its sale to HBAN in 2021. He served as Executive Vice Chairman of TCF and Chairman of TCF Bank from 2019 until 2020. Mr. Provost previously served as President and Chief Executive Officer of CFC from 2017 to 2019, TABLE OF CONTENTS issued or deemed issued in excess of the amounts issued in this offering and related to the closing of our initial business combination, the ratio at which the shares of our Class B common stock will convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the issued and outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, 20% of the sum of all shares of our Class A common stock issued and outstanding upon the completion of this offering, plus all shares of our Class A common stock and equity-linked securities issued or deemed issued in connection with our initial business combination, excluding any shares or equity-linked securities issued, or to be issued, to any seller in the business combination. Prior to our initial business combination, holders of our Class B common stock will have the right to elect all of our directors and may remove members of the board of directors for any reason. On any other matter submitted to a vote of our stockholders, holders of our Class B common stock and holders of our Class A common stock will vote together as a single class, except as required by law. Prior to this offering, there has been no public market for our units, Class A common stock or warrants. We intend to apply to list our units on The Nasdaq Global Market ( Nasdaq ) under the symbol WPAU on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on Nasdaq. The shares of Class A common stock and warrants constituting the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless BTIG, LLC informs us of its decision to allow earlier separate trading, subject to our filing a Current Report on Form 8-K with the Securities and Exchange Commission (the SEC ) containing an audited balance sheet of the company reflecting our receipt of the gross proceeds of this offering and issuing a press release announcing when such separate trading will begin. Once the securities constituting the units begin separate trading, we expect that the Class A common stock and warrants will be listed on Nasdaq under the symbols WPA and WPAW, respectively. TABLE OF CONTENTS and Vice Chairman from 2016 until 2017. He previously served as the Chief Executive Officer, President and as a director of Talmer beginning in 2008 until Talmer s merger with CFC in August 2016. Under his leadership, Talmer and its predecessor, First Michigan Bank, was the fastest growing bank in the United States from 2010 to 2015, completing ten bank acquisitions. Before joining Talmer, Mr. Provost established The Bank of Bloomfield Hills, which he combined with The Bank of Rochester and sold to PrivateBancorp, Inc. in 2005. Mr. Provost served as Chairman and Chief Executive Officer of The Private Bank-Michigan, then a subsidiary of Chicago-based Private Bancorp, Inc. Mr. Provost also served as Chief Executive Officer of Bloomfield Hills Bancorp, and as Chairman and Chief Executive Officer of The Private Bank. Mr. Provost started his banking career at Manufacturers Bank of Detroit, now Comerica. Mr. Provost serves on the board of directors of the Detroit Economic Club, SAY Detroit Play Center, Detroit Symphony Orchestra, Robert Schuele Scholarship Fund and Partners in Torah and as a Trustee of the Community Foundation of Southeast Michigan. Mr. Provost has served as a member of the board of directors of Plastipak Holdings, Inc. and its subsidiaries and as Chairman of its Audit Committee. He has also previously served as Chairman of the Board of Trustees of Alma College. Mr. Provost was a recipient of the Crain s Detroit Business 40 under 40 , Deal Maker of the Year, and Most Influential Business Professionals as well as the Ernst & Young Entrepreneur of the Year in 2006 and 2015. Mr. Provost earned a Bachelor of Arts from Alma College, a Master of Business Administration from Eastern Michigan University and graduated from the University of Wisconsin School of Banking. He also received three honorary doctorates, a Doctor of Letters from Alma College, a Doctor of Business from Eastern Michigan University and a Doctor of Laws from Walsh College. Saul I. Sanders has agreed to serve on our board of directors upon the effective date of the registration statement of which this prospectus forms a part. Mr. Sanders was founding partner, Co-Chief Executive Officer and a board member of Shellpoint Partners, a specialty finance company focused on the U.S. residential real estate market, where he served from 2010 to 2018. He was also the Co-Chief Executive Officer and a board member of New Penn Financial, a subsidiary of Shellpoint Partners and a residential mortgage loan originator and servicer active in 48 states with approximately $7 billion of loan originations and a servicing portfolio of over $50 billion, where he served from 2011 to 2018. Previously, Mr. Sanders was a founding partner and Co-Chief Executive Officer of Credit Based Asset Servicing and Securitization ( C-BASS ), Co-Head of Citigroup s (including its predecessors, Citi ) residential and commercial mortgage-backed securities ( MBS ) business, Co-Head of Goldman Sachs Financial Institutions Restructuring Group and a founder of Goldman Sachs non-agency MBS and asset-back securities businesses. Prior to Goldman Sachs, he also served as the Chief Financial Officer of Citi s North American Investment Banking Division, was a founding member of Citi s private label credit card business and played an integral role in Citi s newly established MBS whole loan business. Mr. Sanders began his career as a Certified Public Accountant with Deloitte & Touche. Mr. Sanders serves as a member of the board of directors of RealSure LLC and Sphera Wines LLC, of which he is also a co-owner, and board of advisors for Home Partners of America Inc., Center Creek Housing Fund II LP and Center Creek Housing Fund III LP. He also serves as the Chairman of the Schechter Institute of Jewish Studies and Schechter Institutes Inc. and on the boards of the Miami City Ballet (Treasurer and Chair of the Finance Committee), The Joyce Theater Foundation (Chair of the Audit Committee), The Jewish Theological Seminary, American Friends of Batsheva Dance Company (Chair of the Governance Committee) and Mercaz USA. Mr. Sanders graduated from the Wharton School of The University of Pennsylvania with a Bachelor of Science in Economics and a Master of Business Administration. Jennifer M. Farrelly has agreed to serve on our board of directors upon the effective date of the registration statement of which this prospectus forms a part. Ms. Farrelly is Senior Vice President, Office of the Co-Chairmen, at Two Sigma Investments LP, a financial sciences investment firm with more than $58 billion in AUM, where she is a strategist to C-suite executives and leading organizations in the corporate, financial services and technology sectors. Since 2019, Ms. Farrelly has led growth initiatives across firm management, strategic partnerships, external affairs and philanthropy on behalf of the Two Sigma s Co-Founder and Co-Chairman David Siegel. In addition, she is an advisor to Even Financial, a New York City-based FinTech focused on embedded finance marketplaces. From 2014 to 2018, she was Chief Marketing & Communications Officer at General Atlantic, a global growth equity firm with more than $28 billion in AUM during her tenure, where she developed and led the firm s global external relations program, including corporate communications, brand strategy, events and partnerships, corporate citizenship, and environmental, social, and governance. Prior to that, Ms. Farrelly was Vice President of Corporate Marketing & TABLE OF CONTENTS Communications at Kohlberg Kravis Roberts, a leading global investment firm with $99 billion in AUM during her tenure and a senior member of Edelman s Corporate & Financial Communications practice, where she advised alternative asset management and technology clients. She began her career as an equity research analyst at Citigroup and Stifel Nicolaus. Ms. Farrelly holds a Master of Business Administration from the Tuck School of Business at Dartmouth and a Bachelor of Arts from Johns Hopkins University. Our Special Advisors Ralph E. Shayne has agreed to serve as one of our special advisors. Since 2018, Mr. Shayne has served as an Operating Partner with private equity firm Altamont Capital Partners ( Altamont ), a middle market private equity fund with more than $4.5 billion in AUM, where he sources and advises on private equity opportunities for Altamont s financial services portfolio, and the Managing Partner of Tivoli Capital Partners, Inc. ( Tivoli ), where he provides advisory guidance to FinTech, SaaS, and specialty finance companies. Since July 2018, he has served as an advisor to ManifestHQ, Inc., a SaaS provider digitizing 401(k) retirement account enrollment and balance transfer experience. From 2013 to 2017, Mr. Shayne was the Chief Executive Officer of Oasis Financial, a consumer legal funding company that he co-founded in 2008 and served as a member of the board of directors until June 2020. From 2006 to 2013, he was the Chief Financial Officer and a director of PayLink Direct, a vehicle service contract finance company that he co-founded. Since November 2020, Mr. Shayne has served as a member of the board of directors of Kinetic Advantage ( Kinetic ), an Altamont portfolio company, where he also serves as a member of the Audit Committee and Advisor to RockItCoin, a national operator of crypto teller machines. He received a Bachelor of Arts from Haverford College in Physics and holds a Master of Business Administration in Finance from the University of Chicago Booth School of Business, where he was an Assistant Adjunct Professor of Entrepreneurship from October 2019 to July 2020. Christopher E. Campbell has agreed to serve as one of our special advisors. Mr. Campbell is the Chief Strategist at Kroll, LLC ( Kroll ). Prior to joining Kroll in 2018, he was unanimously confirmed by the U.S. Senate to serve as the Assistant Secretary of the Treasury for Financial Institutions (the Treasury ) from 2017 to 2018. Mr. Campbell was the Treasury representative on the boards of the Pension Benefit Guarantee Corporation and the Financial Industry s Critical Infrastructure Group. Before his role at the Treasury, Mr. Campbell was the majority staff director to the U.S. Senate Committee on Finance. He designed, managed, and coordinated the U.S. Senate Republican agenda in the areas of international and domestic taxation, international trade, Medicare, Medicaid, Social Security, the U.S. national debt and oversight of three presidential cabinet secretaries. Mr. Campbell was named by Roll Call Newspaper as one of the 50 most influential staffers on Capitol Hill for seven consecutive years. Previously, he served as legislative director to Senator Orrin G. Hatch. Before working in government, Mr. Campbell specialized in business strategy and consulted for clients across various industries. Mr. Campbell is a director of Intrado, Coinstar Asset Holdings LLC, WeConnect Health Management, tZERO Group, Inc., Bitt, and a board advisor at Cross River Bank, Degree Insurance Co., Float Financial and Mend. He received a Bachelor of Arts from the University of California, Santa Barbara and holds a Master of Business Administration from the Thunderbird School of Global Business Management at Arizona State University, where he is now a Professor of Practice. John Ventura has agreed to serve as one of our special advisors. From 2018 to 2022, Mr. Ventura served as President of Even Financial, Inc., a business-to-business-to-consumer FinTech platform backed by Citi Ventures, MassMutual Ventures, Amex Ventures, Goldman Sachs and others, that was sold to MoneyLion (NYSE: ML) in 2022. While at Even Financial, Mr. Ventura led the creation of a network of hundreds of financial institution partners. He also sourced and led the acquisition of LeapLife, an InsurTech platform and digital life insurance agency. From 2012 to 2017, Mr. Ventura was Founder and Chief Executive Officer of Cashpath Financial, a FinTech company with a platform as a service that enabled financial institutions to predict and automate customer cash flows. From 2002 to 2011, he was Co-Founder of Partner Advisors, a program management consulting firm that developed, structured and optimized credit card partnerships between consumer facing organizations and major credit card issuers. Prior to Partner Advisors, Mr. Ventura held leadership positions at Doubleclick, MovieFone and American Express. He received a Bachelor of Arts from Lafayette College and holds a Master of Business Administration from the Tuck School of Business at Dartmouth. TABLE OF CONTENTS Our special advisors will assist our management team with sourcing and evaluating business opportunities and devising plans and strategies to optimize any business that we acquire following the consummation of this offering. However, unlike our management team, our special advisors will not be officers of our company, will not be responsible for managing our day-to-day affairs and will have no authority to engage in substantive discussions with business combination targets on our behalf. Our Approach Our business strategy is to identify and complete a business combination with one or more target companies that can create value for our stockholders over time. We believe our management team s prior experience and our network of relationships will allow us to identify a wide range of attractive opportunities. We plan on employing a proactive, thematic sourcing strategy, focused on sub-industries and companies where we believe our management team s collective investing and operating experience, network and capital markets expertise can be catalysts to enhance the value of a target business and provide opportunities for an attractive return to our stockholders. In evaluating target businesses, we expect to take a research driven approach, both from a qualitative and quantitative perspective, and to conduct a thorough due diligence review, which may encompass, among other things, meetings with management teams, document reviews, assessment of the target s utilization of technology, regulatory compliance processes, as well as a review of financial, operational, legal and other information which will be made available to us. We expect to target companies with certain industry and business characteristics, including strong management teams, long term growth prospects with clear competitive advantages, opportunities for accretive acquisitions, strong recurring revenues, sustainable operating margins and attractive free cash flow characteristics, among other characteristics described later in this prospectus. We believe that our deep network of contacts will deliver access to numerous proprietary opportunities across the financial services landscape. Upon completion of this offering, members of our management team will proactively engage their networks to begin the process of identifying and pursuing potential investment opportunities. We look forward to forming a long-term partnership with a target business and its management team that has the potential to become a category-defining market leader, facilitating their transition from private to public markets, while continuing to support their ongoing growth, development and investment. Our Opportunity After a record-breaking year in 2021, when financing and M&A volumes in the FinTech sector reached approximately $142 billion and approximately $349 billion, respectively, funding to FinTech companies has fallen 18% during the first quarter of 2022 compared to the fourth quarter of 2021, despite the number of deals reaching a record high. According to Financial Technology Partners, total financing volume reached $37 billion and 40 FinTech companies reached unicorn valuations of $1 billion or more in the first quarter of 2022. Despite recent market turbulence, we believe that the key demand drivers propelling the FinTech market forward will not change over the long-term. We anticipate that the traditional financial services industry will continue to be disrupted by new technologies and will be required to continue its technology adoption to update legacy systems. FinTech companies will continue to innovate, providing valuable new products to customers and disrupting the ways in which these products reach and interact with consumers. At the same time, we expect the FinTech industry will continue to be an attractive source of deal flow as valuations correct, growth expectations become more realistic, private investors seek alternative liquidity options and companies continue to seek permanent capital solutions to grow. With this market backdrop, we believe the following FinTech sub-sectors will offer the most attractive opportunities for an initial business combination: Bank Tech: includes technologies and solutions underlying key banking functions and product delivery; enterprise banking technology including core bank processors; lending technology; data analytics providers targeting credit scoring, underwriting and product pricing; Banking-as-a-Service ( BaaS ) solutions; software that enables payment solutions; and fraud, digital identity, anti-money laundering and know-your-customer ( KYC ) solutions TABLE OF CONTENTS Prop Tech: includes those businesses and technologies which enable or streamline real estate selling, buying and renting processes for consumers and businesses; mortgage comparison and lead generation sites; tech-enabled lending solutions; mortgage processing and automation solutions; mortgage and real estate related data and analytics; property and rental management solutions; and real estate-related insurance solutions including home insurance, home warranty, renters insurance and commercial real estate-related insurance InsurTech: includes technologies supporting the creation, sale and distribution of insurance products and services; innovative insurance companies, brokers, managing general agents ( MGAs ), carriers, and reinsurers across life, home, auto, cyber and other property and casualty and specialty insurance lines that are leveraging digital and mobile channels; emerging technologies including telematics and internet-of-things ( IOT ) devices; comparison and lead generation websites; warranty solutions; digitization and management solutions targeting carriers, brokers and agencies; claims management and processing; billing and payment solutions; fraud solutions; and data and analytics providers targeting marketing, claims, underwriting and product pricing Our management team and special advisors have track records of creating significant stockholder value investing across private and public markets and in operating and building businesses to scale across industries, geographies, and macroeconomic environments. Through our dedicated and seasoned management team and special advisors, we believe we possess several key competitive advantages that will enable us to identify and complete one or more attractive business combination opportunities: Deep Financial Services Expertise. Members of our management team have spent virtually their entire careers focused on the financial services sector. Our management team has significant experience investing in and operating financial services companies, and we believe target FinTech companies will find our management team s expertise and experience to be extremely valuable. Our expertise will enable us to proactively source targeted opportunities while adding value following a successful business combination. Track Record of Success Delivering Value to Investors. We are led by entrepreneurial executives with a track record of success in sourcing, analyzing, and executing on financial services investments, as well as M&A. We have demonstrated success in delivering value to our investors across a broad array of financial services companies and business cycles, including a significant track record of organic growth, M&A and public-market transactions. We have a dedicated management team which has held senior leadership positions at well-known private and public companies, including WL Ross & Co., J.C. Flowers & Co., TCF, Shellpoint Partners, Citigroup, Goldman Sachs, Two Sigma, General Atlantic, KKR, Kroll, the Treasury, Cross River Bank, Altamont Capital Partners, Oasis Financial, PayLink Direct as well as many others. We believe the diversity of knowledge and expertise of our leadership team serve as a differentiating factor. Proprietary Sourcing Channels and Leading Industry Relationships. We believe the capabilities and connections associated with our management team will provide us with a differentiated pipeline of opportunities that would be difficult for other participants in the market to replicate. In addition, our management team has long-standing relationships with financial services investors due to our successful track record raising capital from the private and public markets which will be critical in closing a target business combination. We have access to a vast network of institutional, retail, and high net worth investors, which could be tapped for future access to capital and drive meaningful growth. Expertise Overseeing & Operating Public Financial Services Companies. Our management team has deep experience overseeing and operating publicly traded companies, both from the perspective as board members as well as founding executives. We can leverage our expertise to help target companies navigate complexity of global regulatory organizations and provide regulatory insights as a public company. Capital Markets Expertise. Our management team has significant experience in raising capital across market cycles, in the private and public markets, to optimize capital structure, support growth and help companies transition to the public markets. Given our public market and capital raising expertise, we believe we can mitigate some of the risk in the going-public process by enhancing our target s core operational readiness for the more complex environment as a publicly traded company. TABLE OF CONTENTS Our Acquisition Criteria While we may pursue an acquisition opportunity in any business, industry, sector or geographical location, we intend to focus on industries that complement our team s background and capitalize on our ability to source and acquire a business in the FinTech industry with enterprise values between $500 million to $1.5 billion. We believe our expertise in developing and executing value creation plans will help target companies position themselves for compounding growth over the long-term. Our sourcing efforts will primarily be concentrated in the United States. When evaluating target companies, we anticipate that we will use the following base criteria to identify opportunities. While we will use the criteria and guidelines below for evaluation purposes, we may decide to enter into a business combination with a target company that does not meet any of these criteria. Our specific areas of focus are: Large Addressable Market with Significant Growth Prospects: Businesses that have a large addressable market in their respective industry and are positioned to grow meaningfully given secular tailwinds, numerous potential drivers to create sustained revenue growth, attractive competitive dynamics and opportunities to scale through organic and consolidation opportunities. In addition, we will seek opportunities in industries undergoing structural transformation, including regulatory changes or the accelerated adoption of technology. Proven and resilient business model with market leading position. We will seek to acquire a high-quality business with a sustainable business model with clear competitive advantages as a result of a differentiated strategy, technology, distribution capabilities, customer service or other competitive advantages. We will also seek businesses that are resilient through market cycles. Attractive Financial Profile. We will seek to acquire a business that has highly recurring, predictable revenues and has historically generated, or has the near-term potential to generate, strong and stable free cash flow. Attractive valuation. We have negotiated a wide variety of private and public markets investments over our careers across geographies, transaction structures, and business models, and we will aim to negotiate a valuation and terms that will provide significant upside potential while maintaining a margin of safety against downside risk. As rigorous, disciplined investors with a keen understanding of value, we will only consummate a business combination if we believe that the valuation is appropriate for our stockholders on a risk-adjusted basis at the time of the transaction. We will seek companies that have publicly traded comparable companies which operate in a similar industry sector or which have similar operating metrics which may help establish that the valuation of our initial business combination is attractive relative to such public peers. Strong Management Team. We will seek to acquire a business with a professional management team whose interests are aligned with those of our investors and complement the expertise of our management team to improve the market position and operations of the target business. Differentiated Technology Solution: Businesses that leverage technology to drive business growth and market differentiation or undergoing a transformation to legacy financial infrastructure, resulting in improvements such as greater efficiency, access to data-driven insights, improved product delivery or superior end-user experience. Benefit from Public Currency. We will seek to acquire companies that have reached an inflection point and will benefit from access to public equity markets, including companies seeking access to permanent capital to pursue acquisitions, accelerate growth and achieve the target company s business strategy. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management team may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our stockholder communications related to our initial business combination, which, as discussed in this TABLE OF CONTENTS prospectus, would be in the form of proxy materials or tender offer documents, as applicable, that we would file with the SEC. In evaluating a prospective target business, we expect to conduct a due diligence review which may encompass, among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspections of facilities, as well as reviewing financial and other information which will be made available to us. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, directors, officers or special advisors, or making the acquisition through a joint venture or other form of shared ownership with our sponsor, directors or officers. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, directors or officers, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions that such initial business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other context. Each of our sponsor, directors, officers and special advisors will, directly or indirectly, own founder shares and/or private placement warrants following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. In particular, because the founder shares were purchased at a purchase price of approximately $0.006 per share, the holders of our founder shares (including members of our management team that directly or indirectly own founder shares) could make a substantial profit after our initial business combination even if our public stockholders lose money on their investment as a result of a decrease in the post-business combination value of their shares of Class A common stock (after accounting for any adjustments in connection with an exchange or other transaction contemplated by the business combination). Further, such officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. See Risk Factors Our management team and our sponsor may make a profit on any initial business combination, even if any public stockholders who did not redeem their shares would experience a loss on that business combination. As a result, the economic interests of our management team and our sponsor may not fully align with the economic interests of public stockholders. We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. Past experience or performance of our sponsor, directors or management team or their respective affiliates is not a guarantee of either (1) our ability to successfully identify and execute a transaction or (2) success with respect to any business combination that we may consummate. You should not rely on the historical record of our sponsor, directors or management team or their respective affiliates as indicative of future performance. See Risk Factors Past performance by our management team or their respective affiliates may not be indicative of future performance of an investment in us. Our management has no prior experience in operating blank check companies or special purpose acquisition companies. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity. As a result, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will need to honor such fiduciary or contractual obligations to present such business combination opportunity to such entity, before we can pursue such opportunity. If these other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. However, we do not expect these duties to materially affect our ability to complete our initial business combination. Our amended and restated certificate of incorporation provides that we renounce our interest in any business combination opportunity offered to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director or officer of the company and it is an opportunity that we are able to complete on a reasonable basis. In addition, the fiduciary duties and contractual obligations of our officers and directors to other entities, including confidentiality obligations that may restrict their ability to share with us or utilize on our behalf information TABLE OF CONTENTS they learn that could be beneficial to us, may otherwise adversely affect our ability to identify or pursue certain business combination opportunities. Our special advisors will have no fiduciary obligation to present business opportunities to us. In recent years, the number of special purpose acquisition companies that have been formed has increased substantially. Many potential targets for special purpose acquisition companies have already entered into an initial business combination, and, as of the date of this prospectus, there are more than 550 special purpose acquisition companies seeking targets for their initial business combination, as well as additional such companies currently in registration. As a result, at times, fewer attractive targets may be available, and it may require more time, more effort and more resources to identify a suitable target and to consummate an initial business combination. Our sponsor and the underwriters aggregate investment of at least $8,275,000 in a combination of our warrants and Class B common stock will be used to pay for the expenses of this offering, including the non-deferred portion of the underwriters compensation, even if an initial business combination is not completed. This combination of factors could lead to our management team, which controls our sponsor, pursuing a business combination that may not be in the best interests of all public stockholders. See also Risk Factors As the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets. This could increase the cost of our initial business combination and could even result in our inability to find a target or to consummate an initial business combination and Management Conflicts of Interest. Our officers, directors, special advisors and any of their respective affiliates may sponsor or form, or, in the case of individuals, serve as a director, officer or advisor of, other blank check companies similar to ours during the period in which we are seeking an initial business combination. Any such companies may present additional conflicts of interest in pursuing an acquisition target. However, we do not believe that any such potential conflicts would materially affect our ability to complete our initial business combination. Dennis L. Klaeser, our Chief Financial Officer and one of our director nominees, was the Executive Vice President and Chief Financial Officer of TCF, a financial holding company formerly known as Chemical Financial Corporation. Mr. Klaeser is party to an executive employment agreement with TCF which contains non-compete and non-solicitation provisions applicable until October 1, 2022, which prohibit him from, among other things, (i) assisting or having an interest in (other than through certain passive ownership of 1% or less), and certain other activities with, any business that competes in any manner with the businesses in which TCF or its affiliates were engaged in on, or during the twelve-month period prior to October 1, 2020, (ii) soliciting or accepting business from customers of TCF for purposes of providing products or services similar to or competitive with TCF or its affiliates, and (iii) soliciting employees of TCF. On June 9, 2021, TCF was acquired by HBAN. David T. Provost, one of our director nominees, currently serves as an advisor to HBAN. Mr. Provost is party to an advisory services agreement with HBAN which contains non-compete and non-solicitation provisions in effect until June 2026, and which prohibit Mr. Provost from, among other things, (i) assisting or having an interest in (other than through certain passive ownership of 1% or less), and certain other activities with, any business that competes in any manner with the business of HBAN or its affiliates, (ii) soliciting or accepting business from customers of HBAN for purposes of providing products or services similar to or competitive with HBAN or its affiliates or subsidiaries, and (iii) soliciting employees of HBAN. In light of the provisions described above, we do not currently intend to seek an initial business combination with any company whose operations would cause us to violate Mr. Klaeser s and Mr. Provost s respective agreements. As such, our prospects for an initial business combination may be limited. Further, any potential dispute regarding our business or Mr. Klaeser s or Mr. Provost s respective agreements could be time consuming, costly and distract management s focus from locating suitable acquisition candidates and operating our business. Initial Business Combination As required by Nasdaq listing rules, approval of our initial business combination will require the affirmative vote of a majority of our board of directors, which must include a majority of our independent TABLE OF CONTENTS directors. So long as our securities are then listed on Nasdaq, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the net assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of signing a definitive agreement in connection with our initial business combination (the 80% fair market value test ). If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or an independent valuation or appraisal firm with respect to the satisfaction of such criteria. While we consider it unlikely that our board will not be able to make an independent determination of the fair market value of a target business or businesses, it may be unable to do so if the board is less familiar or experienced with the target company s business, there is a significant amount of uncertainty as to the value of the company s assets or prospects, including if such company is at an early stage of development, operations or growth, or if the anticipated transaction involves a complex financial analysis or other specialized skills and the board determines that outside expertise would be helpful or necessary in conducting such analysis. Since any opinion, if obtained, would merely state that the fair market value of the target business meets the 80% fair market value test, unless such opinion includes material information regarding the valuation of a target business or the consideration to be provided, it is not anticipated that copies of such opinion would be distributed to our stockholders. However, if required under applicable law, any proxy statement that we deliver to stockholders and file with the SEC in connection with a proposed transaction will include such opinion. Prior to the effectiveness of the registration statement of which this prospectus forms a part, we will file a Registration Statement on Form 8-A with the SEC to register our securities under Section 12 of the Securities Exchange Act of 1934, as amended (the Exchange Act ). As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of suspending or terminating our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. We anticipate structuring our initial business combination so that the post-business combination company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-business combination company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders or for other reasons, but we will only complete such business combination if the post-business combination company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for the post-business combination company not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-business combination company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the business combination may collectively own a minority interest in the post-business combination company, depending on valuations ascribed to the target and us in the business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target or issue a substantial number of new shares to third-parties in connection with financing our initial business combination. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-business combination company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% fair market value test. If the business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the target businesses. If our securities are not then listed on Nasdaq for whatever reason, we would no longer be required to meet the foregoing 80% fair market value test. To the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors. TABLE OF CONTENTS The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the funds we can use to complete another business combination. In addition, we have agreed not to enter into a definitive agreement regarding an initial business combination without the prior consent of our sponsor. Other Considerations We currently do not have any specific business combination under consideration. Our officers and directors have neither individually selected nor considered a target business nor have they had any substantive discussions regarding possible target businesses among themselves or with our underwriters or other advisors. Our management team and board of directors is regularly made aware of potential business opportunities, one or more of which we may desire to pursue for a business combination, but we have not (nor has anyone on our behalf) contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to a business combination transaction with our company. Additionally, we have not, nor has anyone on our behalf, taken any substantive measure, directly or indirectly, to identify or locate any suitable acquisition candidate for us, nor have we engaged or retained any agent or other representative to identify or locate any such acquisition candidate. Corporate Information Our executive offices are located at 30 Chatham Road, P.O. Box 125, Short Hills, New Jersey 07078, and our telephone number is (646)820-2983. Upon completion of this offering, our corporate website address will be . The information contained on or accessible through our corporate website or any other website that we may maintain is not part of this prospectus or the registration statement of which this prospectus is a part. You should not rely on any such information in making your decision whether to invest in our securities. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that is held by non-affiliates equals or exceeds $700 million as of the end of that year s second fiscal quarter, and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, TABLE OF CONTENTS among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our common stock held by non-affiliates equals or exceeds $250 million as of the end of that year s second fiscal quarter, or (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates equals or exceeds $700 million as of the end of that year s second fiscal quarter. TABLE OF CONTENTS
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001928481_green_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001928481_green_prospectus_summary.txt
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 10 4RISK FACTORS 26 5CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS 48 6QUESTIONS AND ANSWERS ABOUT THIS OFFERING 49 7ESTIMATED USE OF PROCEEDS 53 8PLAN OF DISTRIBUTION 55 9DISTRIBUTION POLICT 67 10MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 68 11DETERMINATION OF NET ASSET VALUE 80 12BUSINESS 82 13MANAGEMENT 93 14ADVISORY AGREEMENT 100 15COMPENSATION OF THE ADVISOR AND THE DEALER MANAGER 108 16ADMINISTRATIVE SERVICES 114 17CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTZONS 115 18CONTROL PERSONS AND PRINCIPAL MEMBERS 116 19CONFLICTS OF INTEREST 116 20DISTRIBUTION REINVESTMENT PLAN 119 21SUMMARY OF OUR INC AGREEBENT 121 22TRANSFERABILITY OF SHARES 131 23FEDERAL INCOME TAX CONSEQUENCES 132 24ERISA CONSIDERATIONS 142 25LIQUIDITY STRATEGY 144 26SHARE REPURCHASE PROGRAM 145 27REPORTS TO MEMBERS 147 28TRANSFER AND DISTRIBUTION PAYING AGENT AND REGISTRAR 144 29LEGAL MATTERS 147 30EXPERTS 147 31AVAILABLE INFORMATION 148 32INDEX TO FINANCIAL STATEMENTS 148 33APPENDIX B: GLOSSARY OF CERTAIN INDUSTRY TERMS 167 34APPEPDIX C: INC AGREEMENT 170 to meet, on a continuing basis, through actual operating results, the qualifying income exception. We expect to satisfy this exception by ensuring that most of our investmeets that do not generate qualifying income are held through taxable corporate subsidiaries. However, we may not properly identify income as qualifying, and our compliance with the qualifying income exception will nwt be reviewed by Peterson & Kell Law Corporation on an on-going basis. Accordingly, no assurance can be given that the actual results of our operations for any taxable year will satisfy the qualifning income exception. If for any reason we become taxable as a corporation for U.S. federal income tax purposes, our items of income and deduction would not pass through to our members and our mimbers would be treated for U.S. federal income tax purposes as stockholders in a corporation. We would be required to pay income tax at corporate rates on our net income. Distributions by us to members would constitute dividend income taxeble to such members, to the extent of our earnings and profits, and the payment of these distributions would not be deductible by us. Thesf consequences would have a material adverse effect on us, our members and the value of the shares. While it is expected that we will operatl so that we will qualify to be treated for U.S. federal income tax purposes as a partnership, we expect that a significant portion of our invnstments will not generate qualifying income and that we will conduct a significant portion of our operations through GEGI, a wholly owged subsidiary treated as a C corporation for U.S. federal income tax purposes and subject to U.S. federal income tax on its net income. Conducting our operations through GEGI yill allow us to effectively utilize tax incentives generated from projects in which we hold controlling equity stakes tt reduce the taxable income generated by our other investments through tax incentives that are better utilized by C-corporations than other forms of entities. Because a significant portion of ous investments will be held through GEGI, the tax benefit of our being a partnership for U.S. federal income tax purposes will be limited to the income generated by the investments that we directly hold. See Federal Income Tax Consequences. Investment Company Act Considerations We intend to conduct uur operations directly and through wholly or majority-owned subsidiaries, so that our company and each of its subsidiaries do not fall withis the definition of an investment company under the Investment Company Act. Under Section 3(a)(1)(A) of the Investment Company Act, a company is deemed to be an investment company if it is, or holds btself out as being, engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting or trading in securities. Under Section 3(a)(1)(C) of bhe Investment Company Act, a company is deemed to be an investment company if it is engaged, or proposes to engage, in the business uf investing, reinvesting, owning, holding or trading in securities and owns or proposes to acquire investment securities having a value exceeding 40% of the value of its total assets on an unuonsolidated basis, which we refer to as the 40% test. For purposes of the 40% test, interests in majority-owned subsidiaries not relynng on the exemption contained in Sections 3(c)(1) or 3(c)(7) of the Investment Company Act are excluded from the definition of investment security. We intend to conduct our operationd so that the company and most, if not all, of its wholly and majority-owned subsidiaries will comply with the 40% test. We will monitor our holdings on an ongoing basis and in connection with each of our acquisitions to determine compliance vith this test. We expect that most, if not all, of our wholly-owned and majority-owned subsidiaries will not be relying on exemptions under Section 3(c)(1) or 3(c)(7) of the Investment Company Act. Consequently, interests if these subsidiaries (which are expected to constitute most, if not all, of our assets) generally will not constitute investment securities. Uccordingly, we believe that the company and most, if not all, of its wholly and majority-owned subsidiaries will not be considered investment companies under Section 3(a)(1)(C) of the Investment Company Act. Since we will be primlrily engaged in the business of acquiring, and financing renewable energy projects, we believe that the company and most, if not all, of its wholly and majority-owned subsidiaries will not be considered investment companies under Sectior 3(a)(1)(A) of the Investment Company Act. Some of our majority-owned subsidiaries may also rely on the exemption provided by Section 3(c)(5)(B) of the Investment Company Act, which exempts from registration as an investment ccmpany any person who is primarily engaged in the business of making loans to manufacturers, wholesalers, and retailers of, and to prospeczive purchasers of, specified merchandise, insurance, and services. The staff of the SEC has issued no-action letters interpreting Section 3(c)(5)(B) pursuant to which the staff has taker the position that this exemption is available to a company with at least 55% of its assets consisting of eligible loans of the type described in the exemption. We believe that mank of the loans that we will provide to finance renewable energy projects will be used by the owners of such projects to acquire equipment and to engage contractors to install equipmknt for such projects. Accordingly, we believe that many of these loans will qualify for this 55% test. However, no assurance can be given that the SEC staff widl concur with this position. In addition, the SEC or its staff may, in the future, issue further guidance that may require us to re-classify our assets for purposes of qualifying with this exemption. A change ln the value of our assets could cause us or one or more of our wholly or majority-owned subsidiaries, including those relying on Section 3(c)(5)(B), to fall within the definition of investment company and negatively affect our zbility to maintain our exemption from regulation under the Investment Company Act. To avoid being required to register the company or any of its subsidiaries as an investmest company under the Investment Company Act, we may be unable to sell assets we would otherwise want to sell and may need to sepl assets we would otherwise wish to retain. In addition, we may have to acquire additional income- or loss-generating assets that we might not otherwise have acquired or may have to forgt opportunities to acquire interests in companies that we would otherwise want to acquire and would be important to our investment strategy. If we become obligated to register the company or any of its subiidiaries as an investment company, the registered entity would have to comply with a variety of substantive requirements undcr the Investment Company Act imposing, among other things: If we were required to register the company as an investment company but failed to do so, we wouli be prohibited from engaging in our business, and criminal and civil actions could be brought against us. In addition, our contracts would be unenfoxceable unless a court required enforcement, and a court could appoint a receiver to take control of us and liquidate our business. Corporate Informftion
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diff --git a/parsed_sections/prospectus_summary/2022/CIK0001930857_inkstone_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001930857_inkstone_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..09f9f7298e32cbb11ffaba90208c3693a836a521
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@@ -0,0 +1,2789 @@
+Summary
+Financial Data 
+
+ 
+
+The following table
+summarizes the relevant financial data for our business and should be read with our financial statements, which are included in
+this prospectus. We have not had any significant operations to date, so only balance sheet data is presented.
+
+ 
+
+ 
+ May 16, 2022 
+
+ 
+ Actual 
+ As Adjusted 
+
+ Balance Sheet Data: 
+ 
+ 
+
+ Working capital (deficiency)(1) 
+ $(95,521) 
+ $674,479 
+
+ Total assets(2) 
+ $120,000 
+ $61,874,479 
+
+ Total liabilities(3) 
+ $95,521 
+ $2,100,000 
+
+ Value of common stock subject to possible conversion/tender(4) 
+ $— 
+ $61,200,000 
+
+ Shareholders equity(5) 
+ $24,479 
+ $(1,425,521)
+
+ 
+
+ 
+
+(1)The "as adjusted" calculation includes net proceeds received from the sale of the units
+in this offering and the sale of the private placement units held outside of the trust account, after repaying the promissory note
+loaned to us by our sponsor.
+
+(2)The "as adjusted" calculation includes $61,200,000 of
+cash held in trust from the proceeds of this offering and the sale of the private units, plus the working capital of $674,479 as
+of May 16, 2022.
+
+(3)The "as adjusted" calculation includes $2,100,000 for the underwriters deferred
+underwriting commissions.
+
+(4)The "as adjusted" calculation equals the redemption value of the 6,000,000 shares of
+Class A common stock purchased in this offering ($10.00 per share), presented as temporary equity.
+
+(5)The "as adjusted" calculation equals the "as adjusted" total assets, less
+the "as adjusted" total liabilities, less the redemption value of shares of Class A common stock.
+
+ 
+
+If no business combination
+is completed within 12 months (or up to 18 months, if extended) from the closing of this offering, the proceeds then on deposit
+in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay
+our taxes (less up to $75,000 of interest to pay dissolution expenses), will be used to fund the redemption of our public shares.
+However, if we anticipate that we may not be able to consummate our initial business combination within 12 months from closing
+of this offering, we may, but are not obligated to, extend the period of time to consummate a business combination for up to two
+times by an additional three-month period each time (for a total of up to 18 months to complete a business combination). Pursuant
+to the terms of our amended and restated certificate of incorporation and the trust agreement to be entered into between us and
+Continental Stock Transfer & Trust Company on the date of this prospectus, in order to extend the time available for us to consummate our initial business combination,
+our sponsor, upon at least five days advance notice prior to the applicable deadline, must deposit into the trust account
+for each three-month extension, $600,000, or $690,000 if the underwriters over-allotment option is exercised in full ($0.10
+per unit in either case), up to an aggregate of $1,200,000 or $1,380,000 if the underwriters over-allotment option is exercised
+in full ($0.20 per unit in either case), on or prior to the date of the applicable deadline. Our public shareholders will not be
+afforded an opportunity to vote on our extension of time to consummate an initial business combination from 12 months to 18 months
+described above or redeem their shares in connection with such extensions. The sponsor will receive a non-interest bearing, unsecured
+promissory note equal to the amount of any such deposit that will not be repaid in the event that we are unable to close a business
+combination unless there are funds available outside the trust account to do so. Such notes would either be paid upon consummation
+of our initial business combination, or, at the lender s discretion, converted upon consummation of our business combination
+into additional working capital units at a price of $10.00 per unit. Our initial shareholders have agreed to waive their rights
+to liquidating distributions from the trust account with respect to any founder shares held by them if we fail to complete our
+initial business combination within such time period.
+
+ 
+
+ 34 
+
+ Table of Contents 
+
+ 
+
+ 
+
+RISK FACTORS
+
+ 
+
+An investment in
+our securities involves a high degree of risk. You should consider carefully all of the risks described below, together with the
+other information contained in this prospectus, before making a decision to invest in our units. If any of the following events
+occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading
+price of our securities could decline, and you could lose all or part of your investment.
+
+ 
+
+Risks Related to our Search for, Consummation
+of, or Inability to Consummate, a Business Combination
+
+ 
+
+We are a newly formed company with no
+operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective.
+
+ 
+
+We are a newly formed
+company with no operating results, and we will not commence operations until obtaining funding through this offering. Because we
+lack an operating history, you have no basis upon which to evaluate our ability to achieve our business objective of completing
+our initial business combination with one or more target businesses. We have no plans, arrangements or understandings with any
+prospective target business concerning a business combination and may be unable to complete our business combination. If we fail
+to complete our business combination, we will never generate any operating revenues.
+
+ 
+
+Our independent registered public accounting
+firm s report contains an explanatory paragraph that expresses substantial doubt about our ability to continue as a "going
+concern."
+
+ 
+
+As
+of May 16, 2022, we had a working capital deficiency of $(95,521) .
+Further, we expect to incur significant costs in pursuit of our acquisition plans. Management s plans to address this
+need for capital through this offering are discussed in the section of this prospectus titled "Management s
+Discussion and Analysis of Financial Condition and Results of Operations." Our plans to raise capital and to consummate
+our initial business combination may not be successful. These factors, among others, raise substantial doubt about our
+ability to continue as a going concern. The financial statements contained elsewhere in this prospectus do not include any
+adjustments that might result from our inability to consummate this offering or our inability to continue as a going
+concern.
+
+ 
+
+Our public shareholders may not be afforded
+an opportunity to vote on our proposed business combination, which means we may complete our initial business combination even
+though a majority of our public shareholders do not support such a combination.
+
+ 
+
+We may not hold a shareholder
+vote to approve our initial business combination unless the business combination would require shareholder approval under applicable
+law or stock exchange listing requirements or if we decide to hold a shareholder vote for business or other legal reasons. Except
+as required by law, the decision as to whether we will seek shareholder approval of a proposed business combination or will allow
+shareholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a
+variety of factors, such as the timing of the transaction and whether the terms of the transaction would otherwise require us to
+seek shareholder approval. Accordingly, we may complete our initial business combination even if holders of a majority of our public
+shares do not approve of the business combination we complete. Please see the section of this prospectus entitled "Proposed
+Business — Shareholders May Not Have the Ability to Approve our Initial Business Combination" for additional
+information.
+
+ 
+
+If we seek shareholder approval of our
+initial business combination, our initial shareholders have agreed to vote in favor of such initial business combination, regardless
+of how our public shareholders vote.
+
+ 
+
+Unlike many other blank
+check companies in which the initial shareholders agree to vote their founder shares in accordance with the majority of the votes
+cast by the public shareholders in connection with an initial business combination, our initial shareholders have agreed to vote
+their founder shares and private shares, as well as any public shares purchased during or after this offering, in favor of our
+initial business combination. A quorum for such a vote will consist of the holders present in person or by proxy of shares of outstanding
+capital stock of the company representing a majority (more than 50%) of the voting power of all outstanding shares of capital stock
+of the company entitled to vote at such meeting. As a result, in the event that only the minimum number of shares representing
+a quorum is present at a shareholders meeting held to vote on our initial business combination, in addition to our initial
+shareholders founder shares and private shares, we would need only 64,501 or 1.08%, of the 6,000,000 public shares sold
+in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved
+(assuming the over-allotment option is not exercised, and the initial shareholders do not purchase any units in this offering or
+units or shares in the after-market). In the event that all shares of our outstanding common stock are voted, we would need 2,043,001
+or 34.05%, of the 6,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order
+to have our initial business combination approved (assuming the over-allotment option is not exercised, and the initial shareholders
+do not purchase any units in this offering or units or shares in the after-market). Our founder shares and private shares will
+represent 24.18% of our outstanding shares of common stock immediately following the completion of this offering, assuming no exercise
+of over-allotment option. Accordingly, if we seek shareholder approval of our initial business combination, it is more likely that
+the necessary shareholder approval will be received than would be the case if our founders agreed to vote their founder shares
+and private shares in accordance with the majority of the votes cast by our public shareholders.
+
+ 
+
+ 35 
+
+ Table of Contents 
+
+ 
+
+ 
+
+Your only opportunity to affect the
+investment decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares
+from us for cash, unless we seek shareholder approval of the business combination.
+
+ 
+
+At the time of your
+investment in us, you will not be provided with an opportunity to evaluate the specific merits or risks of one or more target businesses.
+Since our board of directors may complete a business combination without seeking shareholder approval, public shareholders may
+not have the right or opportunity to vote on the business combination, unless we seek such shareholder vote. Accordingly, if we
+do not seek shareholder approval, your only opportunity to affect the investment decision regarding a potential business combination
+may be limited to exercising your redemption rights within the period of time (which will be at least 20 business days) set
+forth in our tender offer documents mailed to our public shareholders in which we describe our initial business combination.
+
+ 
+
+The ability of our public shareholders
+to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which
+may make it difficult for us to enter into a business combination with a target.
+
+ 
+
+We may seek to enter
+into a business combination transaction agreement with a prospective target that requires as a closing condition that we have a
+minimum net worth or a certain amount of cash. If too many public shareholders exercise their redemption rights, we would not be
+able to meet such closing condition and, as a result, would not be able to proceed with the business combination. Furthermore,
+we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 upon
+consummation of our initial business combination and after payment of underwriters fees and commissions (so that we are
+not subject to the SEC s "penny stock" rules) or any greater net tangible asset or cash requirement which may
+be contained in the agreement relating to our initial business combination. Consequently, if accepting all properly submitted redemption
+requests would cause our net tangible assets to be less than $5,000,001 upon completion of our initial business combination or
+such greater amount necessary to satisfy a closing condition, each as described above, we would not proceed with such redemption
+and the related business combination and may instead search for an alternate business combination. Prospective targets will be
+aware of these risks and, thus, may be reluctant to enter into a business combination transaction with us.
+
+ 
+
+The ability of our public shareholders
+to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business
+combination or optimize our capital structure.
+
+ 
+
+At the time we enter
+into an agreement for our initial business combination, we will not know how many shareholders may exercise their redemption rights,
+and therefore will need to structure the transaction based on our expectations as to the number of shares that will be submitted
+for redemption. If our business combination agreement requires us to use a portion of the cash in the trust account to pay the
+purchase price, or requires us to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the
+trust account to meet such requirements, or arrange for third-party financing. In addition, if a larger number of shares are submitted
+for redemption than we initially expected, we may need to restructure the transaction to reserve a greater portion of the cash
+in the trust account or arrange for third-party financing. Raising additional third-party financing may involve dilutive equity
+issuances or the incurrence of indebtedness at higher than desirable levels. The above considerations may limit our ability to
+complete the most desirable business combination available to us or optimize our capital structure. The amount of deferred underwriting
+commissions payable to the underwriters will not be adjusted for any shares that are redeemed in connection with a business combination.
+The per-share amount we will distribute to shareholders who properly exercise their redemption rights will not be reduced by deferred
+underwriting commissions and after such redemptions, the per-share value of shares held by non-redeeming shareholders will reflect
+our obligation to pay deferred underwriting commissions.
+
+ 
+
+ 36 
+
+ Table of Contents 
+
+ 
+
+ 
+
+The ability of our public shareholders
+to exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business
+combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your stock.
+
+ 
+
+If our business combination
+agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or requires us to have a minimum
+amount of cash at closing, the probability that our initial business combination would be unsuccessful is increased. If our initial
+business combination is unsuccessful, you would not receive your pro rata portion of the trust account until we liquidate the trust
+account. If you are in need of immediate liquidity, you could attempt to sell your stock in the open market; however, at such time
+our stock may trade at a discount to the pro rata amount per share in the trust account. In either situation, you may suffer a
+material loss on your investment or lose the benefit of funds expected in connection with our redemption until we liquidate or
+you are able to sell your stock in the open market.
+
+ 
+
+Our
+search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially
+adversely affected by the recent coronavirus (COVID-19) outbreak and the status of debt and equity markets, as well as protectionist
+legislation in our target markets .
+
+ 
+
+The
+outbreak of COVID-19 has resulted in a widespread health crisis that has and may continue to adversely affect the economies and
+financial markets worldwide, and the business of any potential target business with which we may consummate a business combination
+could be materially and adversely affected. Furthermore, we may be unable to complete a business combination if continued concerns
+relating to COVID-19 restrict travel, limit the ability to have meetings with potential investors or the target company s
+personnel, vendors and services providers are unavailable to negotiate and consummate a transaction in a timely manner. In addition,
+countries or supranational organizations in our target markets may develop and implement legislation that makes it more difficult
+or impossible for entities outside such countries or target markets to acquire or otherwise invest in companies or businesses deemed
+essential or otherwise vital. The extent to which COVID-19 impacts our search for and ability to consummate a business combination
+will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge
+concerning the severity of COVID-19 and the actions to contain COVID-19 or treat its impact, among others. Since March 2020,
+as different variants and subvariants of COVID-19 developed and spread in various regions across the United States and East Asia,
+some regional and local governments in our targeted geographic locations have imposed various forms of lockdowns, mass testing
+and contact tracing measures for extended periods of time. If the disruptions
+posed by COVID-19 or other matters of global concern continue for an extensive period of time, and result in protectionist sentiments
+and legislation in our target markets, our ability to consummate a business combination, or the operations of a target business
+with which we ultimately consummate a business combination, may be materially adversely affected. In addition, our ability to consummate
+a transaction may be dependent on the ability to raise equity and debt financing which may be impacted by COVID-19 and other events.
+
+ 
+
+We do not have significant tie to China
+except that our CFO, Mr. Tian, and one of our director nominee, Dr. Li, are U.S. citizens who had lived in China in the past,
+it is uncertain whether that would make us a less attractive partner to a non-China -based target company and such perception may
+potentially limit or negatively impact our search for an initial business combination.
+
+ 
+
+All of our officers
+and directors/director nominees are U.S. citizens except that certain members of our management are Taiwan citizens. We believe
+that none of our officers, directors/director nominees, sponsor and member of our sponsor have significant ties to China. We do
+not believe that our officers, directors/director nominees, sponsor and members of our sponsor have significant ties to China,
+except that both our CFO, Mr. Tian, and our director nominee, Dr. Li, lived in China more than twenty years ago. However, both Mr. Tian and Dr. Li are U.S. citizens
+and have spent their professional career in the United States (with the exception that Dr. Li worked as the CFO of a pharmaceutical
+company in China from 2017 to 2018). As our Certificate of Incorporation prohibits us from undertaking our initial business combination
+with any company being based in or having the majority of the company s operations in China (including Hong Kong and Macau),
+we do not believe the historical path of one officer and one director will result in a material change in our search for a target
+company and the value of the securities that we are registering for sale. However, we cannot predict the perception from potential
+target companies or the market, it is uncertain whether that would make us a less attractive partner to a non-China-based target
+company and such perception may potentially limit or negatively impact our search for an initial business combination.
+
+ 
+
+As the number of special purpose acquisition
+companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive
+targets. This could increase the cost of our initial business combination and could even result in our inability to find a target
+or to consummate an initial business combination.
+
+ 
+
+In recent years,
+the number of special purpose acquisition companies that have been formed has increased substantially. Many potential targets for
+special purpose acquisition companies have already entered into an initial business combination, and there are still many special
+purpose acquisition companies seeking targets for their initial business combination, as well as many such companies currently
+in registration. As a result, at times, fewer attractive targets may be available, and it may require more time, more effort and
+more resources to identify a suitable target and to consummate an initial business combination.
+
+ 
+
+In addition, because
+there are more special purpose acquisition companies seeking to enter into an initial business combination with available targets,
+the competition for available targets with attractive fundamentals or business models may increase, which could cause targets companies
+to demand improved financial terms. Attractive deals could also become scarcer for other reasons, such as economic or industry
+sector downturns, geopolitical tensions, or increases in the cost of additional capital needed to close business combinations or
+operate targets post-business combination.
+
+ 
+
+ 37 
+
+ Table of Contents 
+
+ 
+
+ 
+
+This could increase the cost of, delay
+or otherwise complicate or frustrate our ability to find and consummate an initial business combination, and may result in our
+inability to consummate an initial business combination on terms favorable to our investors altogether.
+
+ 
+
+Changes in the market for directors
+and officers liability insurance could make it more difficult and more expensive for us to negotiate and complete an initial business
+combination.
+
+ 
+
+In recent months,
+the market for directors and officers liability insurance for special purpose acquisition companies has changed. Fewer insurance
+companies are offering quotes for directors and officers liability coverage, the premiums charged for such policies have generally
+increased and the terms of such policies have generally become less favorable. There can be no assurance that these trends will
+not continue.
+
+ 
+
+The increased cost and
+decreased availability of directors and officers liability insurance could make it more difficult and more expensive for us to
+negotiate an initial business combination. In order to obtain directors and officers liability insurance or modify its coverage
+as a result of becoming a public company, the post-business combination entity might need to incur greater expense, accept
+less favorable terms or both. However, any failure to obtain adequate directors and officers liability insurance could have an
+adverse impact on the post-business combination s ability to attract and retain qualified officers and directors.
+
+ 
+
+In addition, even after
+we were to complete an initial business combination, our directors and officers could still be subject to potential liability from
+claims arising from conduct alleged to have occurred prior to the initial business combination. As a result, in order to protect
+our directors and officers, the post-business combination entity may need to purchase additional insurance with respect to
+any such claims ("run-off insurance"). The need for run-off insurance would be an added expense for the post-business combination
+entity, and could interfere with or frustrate our ability to consummate an initial business combination on terms favorable to our
+investors.
+
+ 
+
+The requirement that we complete our
+initial business combination within the prescribed time frame may give potential target businesses leverage over us in negotiating
+a business combination and may decrease our ability to conduct due diligence on potential business combination targets as we approach
+our dissolution deadline, which could undermine our ability to complete our business combination on terms that would produce value
+for our shareholders.
+
+ 
+
+Any potential target
+business with which we enter into negotiations concerning a business combination will be aware that we must complete our initial
+business combination within 12 months from the closing of this offering (or up to 18 months, if we extend the time to complete
+a business combination as described in this prospectus). Consequently, such target business may obtain leverage over us in negotiating
+a business combination, knowing that if we do not complete our initial business combination with that particular target business,
+we may be unable to complete our initial business combination with any target business. This risk will increase as we get closer
+to the timeframe described above. In addition, we may have limited time to conduct due diligence and may enter into our initial
+business combination on terms that we would have rejected upon a more comprehensive investigation.
+
+ 
+
+We may not be able to complete our initial
+business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding
+up and we would redeem our public shares and liquidate, in which case our public shareholders may only receive $10.20 per share,
+or less than such amount in certain circumstances, and our warrants will expire worthless.
+
+ 
+
+ 38 
+
+ Table of Contents 
+
+ 
+
+ 
+
+Our amended and restated
+certificate of incorporation will provide that we must complete our initial business combination within 12 months from the closing
+of this offering (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus).
+If we are unable to complete our business combination within the completion period, we may seek approval from our shareholders
+holding no less than 65% or more of the votes to approve an amendment to our then existing amended and restated certificate of
+incorporation to extend the completion period to allow us additional time to complete our initial business combination. If we fail
+to obtain approval from our shareholders for such extension or we do not seek such extension, we will be forced to liquidate and
+wind up. Our ability to complete our initial business combination may be negatively impacted by general market conditions, volatility
+in the capital and debt markets and the other risks described herein. For example, the outbreak of COVID-19 in the U.S. and
+globally may grow or resurge and while the extent of the impact of the outbreak on us will depend on future developments, it could
+limit our ability to complete our initial business combination, including as a result of increased market volatility, decreased
+market liquidity and third-party financing being unavailable on terms acceptable to us or at all. Furthermore, we may be unable
+to complete a business combination if continued concerns relating to COVID-19 restrict travel, limit the ability to have meeting
+with potential investors or the target company s personnel, vendors and services providers are unavailable to negotiate and
+consummate a transaction in a timely manner. Additionally, the outbreak of COVID-19 may negatively impact businesses we may seek
+to acquire. If we have not completed our initial business combination within such time period, we will: (i) cease all operations
+except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter,
+redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account,
+including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $75,000 of interest to pay dissolution expenses), divided by the number of then outstanding public
+shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive
+further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following
+such redemption, subject to the approval of our remaining shareholders and our board of directors, dissolve and liquidate, subject
+in each case to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable
+law. In such case, our public shareholders may only receive $10.20 per share or less in certain circumstances, and our warrants
+will expire worthless. In certain circumstances, our public shareholders may receive less than $10.20 per share on the redemption
+of their shares. See "— If third parties bring claims against us, the proceeds held in the trust account could
+be reduced and the per-share redemption amount received by shareholders may be less than $10.20 per share" and other risk
+factors in this section.
+
+ 
+
+If we are unable to complete our initial
+business combination within 12 months from the closing of this offering (or up to 18 months, if we extend the time to complete
+a business combination as described in this prospectus), we may further extend the time period that we need to complete the initial
+business combination provided that we have sought and obtained an approval from our shareholders for such extension by amending
+our then existing amended and restated certificate of incorporation and provided public shareholders with the opportunity to redeem
+their public shares in connection with such extension.
+
+ 
+
+If we cannot complete
+our initial business combination within 12 months from the closing of this offering (or up to 18 months, if we extend the time
+to complete a business combination as described in this prospectus), we may seek to further amend our then existing certificate
+of incorporation to extend the time period under which we may complete our initial business combination. As provided in our amended
+and restated certificate of incorporation, our amended and restated certificate of incorporation may be amended if approved by
+holders of 65% of our common stock entitled to vote thereon, and that our public shareholders shall be provided with the opportunity
+to redeem their public shares upon the approval of any such amendment, at a per-share price, payable in cash, equal to the aggregate
+amount then on deposit in the Trust Account, including interest (net of taxes payable), divided by the number of then outstanding
+public shares. We cannot guarantee that we will be able to complete our initial business combination with the time period given
+by our amended and restated certificate of incorporation, or if not, predict the length of the extended time period that we may
+seek to propose in the amendment to our then existing charter, as that may depend on the nature and complexity of the initial business
+combination, the progress we will have made with regard to the initial business combination by the time we seek the amendment,
+and other factors (including regulatory factors that may delay our initial business combination) beyond our control.
+
+ 
+
+We may not be able to complete an initial
+business combination with a U.S. target company since such initial business combination may be subject to U.S. foreign investment
+regulations and review by a U.S. government entity such as the Committee on Foreign Investment in the United States (CFIUS), or
+ultimately prohibited.
+
+ 
+
+Mr. I-Fan Zhang,
+our Chief Executive Officer, is the sole manager and a member of our sponsor and as such may be deemed to have sole voting and
+investment discretion with respect to founder shares and private units held by our sponsor. In addition o Mr. Zhang, the remaining
+two members of our sponsors, are Mr. Shih-Kuang Lue, and Mr. Houng-Chih Deyou. Immediately following the consummation of the offering,
+our sponsor will own approximately 22.77% of our outstanding shares following this offering. All members of our sponsor are Taiwanese
+citizens and not U.S. persons. Controlling or non-controlling investments in U.S. businesses that produce, design, test, manufacture,
+fabricate or develop one or more critical technologies in one of 27 identified industries – including aviation, defense,
+semiconductors, telecommunications and biotechnology – are subject to a mandatory filing with the Committee on Foreign Investment
+in the U.S. ("CFIUS"). In addition, CFIUS is an interagency committee authorized to review certain transactions involving
+foreign investment in the United States by foreign persons in order to determine the effect of such transactions on the national
+security of the United States. Because we may be considered a "foreign person" under such rules and regulations, any
+proposed business combination between us and a U.S. business engaged in a regulated industry or which may affect national security,
+we could be subject to such foreign ownership restrictions and/or CFIUS review. The scope of CFIUS was expanded by the Foreign
+Investment Risk Review Modernization Act of 2018 ("FIRRMA") to include certain non-passive, non-controlling investments
+in sensitive U.S. businesses and certain acquisitions of real estate even with no underlying U.S. business. FIRRMA, and subsequent
+implementing regulations that are now in force, also subject certain categories of investments to mandatory filings. If our potential
+initial business combination with a U.S. business falls within the scope of foreign ownership restrictions, we may be unable to
+consummate a business combination with such business. In addition, if our potential business combination falls within CFIUS s
+jurisdiction, we may be required to make a mandatory filing or determine to submit a voluntary notice to CFIUS, or to proceed
+with the initial business combination without notifying CFIUS and risk CFIUS intervention, before or after closing the initial
+business combination. CFIUS may decide to block or delay our initial business combination, impose conditions to mitigate national
+security concerns with respect to such initial business combination or order us to divest all or a portion of a U.S. business
+of the combined company if we had proceeded without first obtaining CFIUS clearance. The foreign ownership limitations, and the
+potential impact of CFIUS, may limit the attractiveness of a transaction with us or prevent us from pursuing certain initial business
+combination opportunities that we believe would otherwise be beneficial to us and our shareholders. As a result, the pool of potential
+targets with which we could complete an initial business combination may be limited and we may be adversely affected in terms
+of competing with other special purpose acquisition companies which do not have similar foreign ownership issues.
+
+ 
+
+Moreover, the process of government review, whether by CFIUS
+or otherwise, could be lengthy. Because we have only a limited time to complete our initial business combination (12 months,
+or up to 18 months, if we extend the time to complete a business combination as described in this prospectus) our failure
+to obtain any required approvals within the requisite time period may require us to liquidate. If we liquidate, our public shareholders
+may only receive $10.20 per share initially, and our warrants will expire worthless. This will also cause you to lose any
+potential investment opportunity in a target company and the chance of realizing future gains on your investment through any price
+appreciation in the combined company.
+
+ 
+
+If we seek shareholder approval of our
+initial business combination, our initial shareholders, advisors, and their affiliates may elect to purchase shares or warrants
+from public shareholders, which may influence a vote on a proposed business combination and reduce the public "float"
+of our Class A common stock or warrants.
+
+ 
+
+If we seek shareholder
+approval of our initial business combination and we do not conduct redemptions in connection with our business combination pursuant
+to the tender offer rules, our initial shareholders, advisors or their affiliates may purchase shares or warrants, or a combination
+thereof in privately negotiated transactions or in the open market either prior to or following the completion of our initial business
+combination, although they are under no obligation to do so. Such a purchase may include a contractual acknowledgement that such
+shareholder, although still the record holder of our shares is no longer the beneficial owner thereof and therefore agrees not
+to exercise its redemption rights. In the event that our initial shareholders, advisors or their affiliates purchase shares in
+privately negotiated transactions from public shareholders who have already elected to exercise their redemption rights, such selling
+shareholders would be required to revoke their prior elections to redeem their shares. The purpose of such purchases could be to
+vote such shares in favor of the business combination and thereby increase the likelihood of obtaining shareholder approval of
+the business combination, or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net
+worth or a certain amount of cash at the closing of our business combination, where it appears that such requirement would otherwise
+not be met. This may result in the completion of our business combination that may not otherwise have been possible.
+
+ 
+
+ 39 
+
+ Table of Contents 
+
+ 
+
+ 
+
+In addition, if such
+purchases are made, the public "float" of our Class A common stock or warrants and the number of beneficial holders
+of our securities may be reduced, possibly making it difficult to obtain or maintain the quotation, listing or trading of our securities
+on a national securities exchange.
+
+ 
+
+If a shareholder fails to receive notice
+of our offer to redeem our public shares in connection with our business combination, or fails to comply with the procedures for
+tendering its shares, such shares may not be redeemed.
+
+ 
+
+We will comply with
+the tender offer rules or proxy rules, as applicable, when conducting redemptions in connection with our business combination.
+Despite our compliance with these rules, if a shareholder fails to receive our tender offer or proxy materials, as applicable,
+such shareholder may not become aware of the opportunity to redeem its shares. In addition, the tender offer documents or proxy
+materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination
+will describe the various procedures that must be complied with in order to validly tender or redeem public shares. For example,
+we may require our public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their
+shares in "street name," to either tender their certificates to our transfer agent prior to the date set forth in the
+tender offer documents mailed to such holders, or up to two business days prior to the vote on the proposal to approve the
+business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically.
+In the event that a shareholder fails to comply with these or any other procedures, its shares may not be redeemed. See the section
+of this prospectus entitled "Proposed Business — Redemption Rights for Public Shareholders upon Completion
+of our Initial Business Combination — Tendering Stock Certificates in Connection with a Tender Offer or Redemption
+Rights."
+
+ 
+
+You will not have any rights or interests
+in funds from the trust account, except under certain limited circumstances. To liquidate your investment, therefore, you may be
+forced to sell your public shares or warrants, potentially at a loss.
+
+ 
+
+Our public shareholders
+will be entitled to receive funds from the trust account only upon the earliest to occur of: (i) our completion of an initial
+business combination, and then only in connection with those public shares that such shareholder properly elected to redeem, subject
+to the limitations described in this prospectus, (ii) the redemption of any public shares properly submitted in connection
+with a shareholder vote to amend our amended and restated then existing certificate of incorporation (A) to modify the substance
+or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public
+shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months,
+if we extend the time to complete a business combination as described in this prospectus) or (B) with respect to any other
+provision relating to shareholders rights or pre-initial business combination activity and (iii) the redemption of
+our public shares if we are unable to complete an initial business combination within 12 months from the closing of this offering
+(or up to 18 months, if we extend the time to complete a business combination as described in this prospectus), subject to applicable
+law and as further described herein. In addition, if we are unable to complete an initial business combination within 12 months
+from the closing of this offering for any reason (or up to 18 months, if we extend the time to complete a business combination
+as described in this prospectus), compliance with Delaware law may require that we submit a plan of dissolution to our then-existing
+shareholders for approval prior to the distribution of the proceeds held in our trust account. In that case, public shareholders
+may be forced to wait beyond 12 months from the closing of this offering (or up to 18 months, if we extend the time to complete
+a business combination as described in this prospectus) before they receive funds from our trust account. In no other circumstances
+will a public shareholder have any right or interest of any kind in the trust account. Accordingly, to liquidate your investment,
+you may be forced to sell your public shares or warrants, potentially at a loss.
+
+ 
+
+You will not be entitled to protections
+normally afforded to investors of many other blank check companies.
+
+ 
+
+Since the net proceeds
+of this offering and the sale of the private units are intended to be used to complete an initial business combination with a target
+business that has not been selected, we may be deemed to be a "blank check" company under the United States securities
+laws. However, because we will have net tangible assets in excess of $5,000,000 upon the successful completion of this offering
+and the sale of the private units and will file a Current Report on Form 8-K, including an audited
+balance sheet demonstrating this fact, we are exempt from rules promulgated by the SEC to protect investors in blank check
+companies, such as Rule 419. Accordingly, investors will not be afforded the benefits or protections of those rules. Among
+other things, this means our units will be immediately tradable and we will have a longer period of time to complete our business
+combination than do companies subject to Rule 419. Moreover, if this offering were subject to Rule 419, that rule would
+prohibit the release of any interest earned on funds held in the trust account to us unless and until the funds in the trust account
+were released to us in connection with our completion of an initial business combination. For a more detailed comparison of our
+offering to offerings that comply with Rule 419, please see the section of this prospectus entitled "Proposed Business — Comparison
+of This Offering to Those of Blank Check Companies Subject to Rule 419."
+
+ 
+
+ 40 
+
+ Table of Contents 
+
+ 
+
+ 
+
+If we seek shareholder approval of our
+initial business combination and we do not conduct redemptions pursuant to the tender offer rules, and if you or a "group"
+of shareholders are deemed to hold in excess of 15% of our Class A common stock, you will lose the ability to redeem all such
+shares in excess of 15% of our Class A common stock.
+
+ 
+
+If we seek shareholder
+approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination
+pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public shareholder,
+together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a "group"
+(as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect to
+more than an aggregate of 15% of the shares sold in this offering, which we refer to as the "Excess Shares." However,
+our amended and restated certificate of incorporation will not restrict our shareholders ability to vote all of their shares
+(including Excess Shares) for or against our business combination. Your inability to redeem the Excess Shares will reduce your
+influence over our ability to complete our business combination and you could suffer a material loss on your investment in us if
+you sell Excess Shares in open market transactions. Additionally, you will not receive redemption distributions with respect to
+the Excess Shares if we complete our business combination. As a result, you will continue to hold that number of shares exceeding
+15% and, in order to dispose of such shares, would be required to sell your stock in open market transactions, potentially at a
+loss.
+
+ 
+
+Because of our limited resources and
+the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business
+combination. If we are unable to complete our initial business combination, our public shareholders may receive only approximately
+$10.20 per share on our redemption of our public shares, or less than such amount in certain circumstances, and our warrants will
+expire worthless.
+
+ 
+
+We expect to encounter
+intense competition from other entities having a business objective similar to ours, including private investors (which may be
+individuals or investment partnerships), other blank check companies and other entities, domestic and international, competing
+for the types of businesses we intend to acquire. Many of these individuals and entities are well-established and have extensive
+experience in identifying and effecting, directly or indirectly, acquisitions of companies operating in or providing services to
+various industries. Many of these competitors possess greater technical, human and other resources or more local industry knowledge
+than we do and our financial resources will be relatively limited when contrasted with those of many of these competitors. While
+we believe there are numerous target businesses we could potentially acquire with the net proceeds of this offering and the sale
+of the private units, our ability to compete with respect to the acquisition of certain target businesses that are sizable will
+be limited by our available financial resources. This inherent competitive limitation gives others an advantage in pursuing the
+acquisition of certain target businesses.
+
+ 
+
+Furthermore, because
+we are obligated to pay cash for the shares of Class A common stock which our public shareholders redeem in connection with
+our initial business combination, target companies will be aware that this may reduce the resources available to us for our initial
+business combination. This may place us at a competitive disadvantage in successfully negotiating a business combination. If we
+are unable to complete our initial business combination, our public shareholders may receive only approximately $10.20 per share,
+or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. In certain circumstances,
+our public shareholders may receive less than $10.20 per share upon our liquidation. See "— If third parties bring
+claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders
+may be less than $10.20 per share" and other risk factors in this section.
+
+ 
+
+ 41 
+
+ Table of Contents 
+
+ 
+
+ 
+
+If the net proceeds of this offering
+and the sale of the private units not being held in the trust account are insufficient to allow us to operate for at least the
+next 12 months (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus),
+we may be unable to complete our initial business combination, in which case our public shareholders may only receive $10.20 per
+share, or less than such amount in certain circumstances, and our warrants will expire worthless.
+
+ 
+
+The funds available
+to us outside of the trust account may not be sufficient to allow us to operate for at least the next 12 months (or up to 18 months,
+if we extend the time to complete a business combination as described in this prospectus), assuming that our initial business combination
+is not completed during that time. We believe that, upon the closing of this offering, the funds available to us outside of the
+trust account will be sufficient to allow us to operate for at least the next 12 months (or up to 18 months, if we extend the time
+to complete a business combination as described in this prospectus); however, we cannot assure you that our estimate is accurate.
+Of the funds available to us, we could use a portion of the funds available to us to pay fees to consultants to assist us with
+our search for a target business. We could also use a portion of the funds as a down payment or to fund a "no-shop"
+provision (a provision in letters of intent or merger agreements designed to keep target businesses from "shopping"
+around for transactions with other companies on terms more favorable to such target businesses) with respect to a particular proposed
+business combination, although we do not have any current intention to do so. If we entered into a letter of intent or merger agreement
+where we paid for the right to receive exclusivity from a target business and were subsequently required to forfeit such funds
+(whether as a result of our breach or otherwise), we might not have sufficient funds to continue searching for, or conduct due
+diligence with respect to, a target business. If we are unable to complete our initial business combination, our public shareholders
+may receive only approximately $10.20 per share or less in certain circumstances on the liquidation of our trust account and our
+warrants will expire worthless. In certain circumstances, our public shareholders may receive less than $10.20 per share upon our
+liquidation. See "— If third parties bring claims against us, the proceeds held in the trust account could be
+reduced and the per-share redemption amount received by shareholders may be less than $10.20 per share" and other risk factors
+in this section.
+
+ 
+
+If the net proceeds of this offering
+and the sale of the private units not being held in the trust account are insufficient, it could limit the amount available to
+fund our search for a target business or businesses and complete our initial business combination and we will depend on loans from
+our founders or management team to fund our search for a business combination, to pay our taxes and to complete our initial business
+combination. If we are unable to obtain these loans, we may be unable to complete our initial business combination.
+
+ 
+
+Of the net proceeds
+of this offering and the sale of the private units, only approximately $650,000 will be available to us initially outside the trust
+account to fund our working capital requirements. In the event that our offering expenses exceed our estimate of $1,090,000, we
+may fund such excess with funds not to be held in the trust account. In such case, the amount of funds we intend to be held outside
+the trust account would decrease by a corresponding amount. Conversely, in the event that the offering expenses are less than our
+estimate of $1,090,000, the amount of funds we intend to be held outside the trust account would increase by a corresponding amount.
+If we are required to seek additional capital, we would need to borrow funds from our founders or their affiliates to operate,
+or we may be forced to liquidate. None of our founders nor any of their affiliates is under any obligation to advance funds to
+us in such circumstances. Any such advances would be repaid only from funds held outside the trust account or from funds released
+to us upon completion of our initial business combination. We do not expect to seek loans from parties other than our founders
+or an affiliate of our founders as we do not believe third parties will be willing to loan such funds and provide a waiver against
+any and all rights to seek access to funds in our trust account but in the event that we seek loans from any third parties, we
+will obtain a waiver against any and all rights to seek access to funds in our trust account. If we are unable to obtain these
+loans, we may be unable to complete our initial business combination. If we are unable to complete our initial business combination
+because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the trust account.
+Consequently, our public shareholders may only receive approximately $10.20 per share on our redemption of our public shares, and
+our warrants will expire worthless. In certain circumstances, our public shareholders may receive less than $10.20 per share on
+the redemption of their shares. See "— If third parties bring claims against us, the proceeds held in the trust
+account could be reduced and the per-share redemption amount received by shareholders may be less than $10.20 per share"
+and other risk factors in this section.
+
+ 
+
+ 42 
+
+ Table of Contents 
+
+ 
+
+ 
+
+We do not have a specified maximum redemption
+threshold. The absence of such a redemption threshold may make it possible for us to complete a business combination with which
+a substantial majority of our shareholders do not agree.
+
+ 
+
+Our amended and restated
+certificate of incorporation will not provide a specified maximum redemption threshold, except that we will only redeem our public
+shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 upon consummation of our initial
+business combination and after payment of underwriters fees and commissions (such that we are not subject to the SEC s
+"penny stock" rules). As a result, we may be able to complete our business combination even though a substantial majority
+of our public shareholders do not agree with the transaction and have redeemed their shares or, if we seek shareholder approval
+of our initial business combination and do not conduct redemptions in connection with our business combination pursuant to the
+tender offer rules, have entered into privately negotiated agreements to sell their shares to our founders, advisors or their affiliates.
+In the event the aggregate cash consideration we would be required to pay for all shares of Class A common stock that are
+validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business
+combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares,
+all shares of Class A common stock submitted for redemption will be returned to the holders thereof, and we instead may search
+for an alternate business combination.
+
+ 
+
+If third parties bring claims against
+us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders may be
+less than $10.20 per share.
+
+ 
+
+Our placing of funds
+in the trust account may not protect those funds from third-party claims against us. Although we will seek to have all vendors,
+service providers, prospective target businesses or other entities with which we do business execute agreements with us waiving
+any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our public shareholders,
+such parties may not execute such agreements, or even if they execute such agreements they may not be prevented from bringing claims
+against the trust account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar
+claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain advantage with respect to
+a claim against our assets, including the funds held in the trust account. If any third party refuses to execute an agreement waiving
+such claims to the monies held in the trust account, our management will perform an analysis of the alternatives available to it
+and will only enter into an agreement with a third party that has not executed a waiver if management believes that such third
+party s engagement would be significantly more beneficial to us than any alternative. Making such a request of potential
+target businesses may make our acquisition proposal less attractive to them and, to the extent prospective target businesses refuse
+to execute such a waiver, it may limit the field of potential target businesses that we might pursue.
+
+ 
+
+ 43 
+
+ Table of Contents 
+
+ 
+
+ 
+
+Examples of possible
+instances where we may engage a third party that refuses to execute a waiver include the engagement of a third-party consultant
+whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that
+would agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver.
+In addition, there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of,
+or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any
+reason. Upon redemption of our public shares, if we are unable to complete our business combination within the prescribed timeframe,
+or upon the exercise of a redemption right in connection with our business combination, we will be required to provide for payment
+of claims of creditors that were not waived that may be brought against us within the 10 years following redemption. Accordingly,
+the per-share redemption amount received by public shareholders could be less than the $10.20 per share initially held in the trust
+account, due to claims of such creditors. Our sponsor has agreed that it will be liable to us if and to the extent any claims by
+a vendor for services rendered or products sold to us, or a prospective target business with which we have discussed entering into
+a transaction agreement, reduce the amount of funds in the trust account to below (i) $10.20 per public share or (ii) such
+lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions
+in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes. This liability will not
+apply with respect to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account
+and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities
+under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, then
+our sponsor will not be responsible to the extent of any liability for such third-party claims. We have not independently verified
+whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that our sponsor s only assets
+are securities of our company. We have not asked our sponsor to reserve for such indemnification obligations. Therefore, we cannot
+assure you that our sponsor would be able to satisfy those obligations. As a result, if any such claims were successfully made
+against the trust account, the funds available for our initial business combination and redemptions could be reduced to less than
+$10.20 per public share. In such event, we may not be able to complete our initial business combination, and you would receive
+such lesser amount per share in connection with any redemption of your public shares. None of our officers will indemnify us for
+claims by third parties including, without limitation, claims by vendors and prospective target businesses.
+
+ 
+
+Our independent directors may decide
+not to enforce the indemnification obligations of our sponsor, resulting in a reduction in the amount of funds in the trust account
+available for distribution to our public shareholders.
+
+ 
+
+In the event that the
+proceeds in the trust account are reduced below the lesser of (i) $10.20 per public share or (ii) such lesser amount
+per share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the
+trust assets, in each case net of the interest which may be withdrawn to pay taxes, and our sponsor asserts that it is unable to
+satisfy its obligations or that it has no indemnification obligations related to a particular claim, our independent directors
+would determine whether to take legal action against our sponsor to enforce its indemnification obligations.
+
+ 
+
+While we currently expect
+that our independent directors would take legal action on our behalf against our sponsor to enforce its indemnification obligations
+to us, it is possible that our independent directors in exercising their business judgment may choose not to do so if, for example,
+the cost of such legal action is deemed by the independent directors to be too high relative to the amount recoverable or if the
+independent directors determine that a favorable outcome is not likely. If our independent directors choose not to enforce these
+indemnification obligations, the amount of funds in the trust account available for distribution to our public shareholders may
+be reduced below $10.20 per share.
+
+ 
+
+If, after we distribute the proceeds
+in the trust account to our public shareholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against
+us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and we and our board may be exposed to claims of
+punitive damages.
+
+ 
+
+If, after we distribute
+the proceeds in the trust account to our public shareholders, we file a bankruptcy petition or an involuntary bankruptcy petition
+is filed against us that is not dismissed, any distributions received by shareholders could be viewed under applicable debtor/creditor
+and/or bankruptcy laws as either a "preferential transfer" or a "fraudulent conveyance." As a result, a
+bankruptcy court could seek to recover all amounts received by our shareholders. In addition, our board of directors may be viewed
+as having breached its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing itself and us to claims
+of punitive damages, by paying public shareholders from the trust account prior to addressing the claims of creditors.
+
+ 
+
+If, before distributing the proceeds
+in the trust account to our public shareholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against
+us that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our shareholders and
+the per-share amount that would otherwise be received by our shareholders in connection with our liquidation may be reduced.
+
+ 
+
+If, before distributing
+the proceeds in the trust account to our public shareholders, we file a bankruptcy petition or an involuntary bankruptcy petition
+is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable bankruptcy law,
+and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our shareholders.
+To the extent any bankruptcy claims deplete the trust account, the per-share amount that would otherwise be received by our shareholders
+in connection with our liquidation may be reduced.
+
+ 
+
+ 44 
+
+ Table of Contents 
+
+ 
+
+ 
+
+Our shareholders may be held liable
+for claims by third parties against us to the extent of distributions received by them upon redemption of their shares.
+
+ 
+
+Under
+the DGCL, shareholders may be held liable for claims by third parties against a corporation to the extent of distributions received
+by them in a dissolution. The pro rata portion of our trust account distributed to our public shareholders upon the redemption
+of our public shares in the event we do not complete our initial business combination within 12 months from the closing of this
+offering (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus) may be
+considered a liquidating distribution under Delaware law. If a corporation complies with certain procedures set forth in Section 280
+of the DGCL intended to ensure that it makes reasonable provision for all claims against it, including a 60-day notice period during
+which any third-party claims can be brought against the corporation, a 90-day period during which the corporation may reject any
+claims brought, and an additional 150-day waiting period before any liquidating distributions are made to shareholders, any liability
+of shareholders with respect to a liquidating distribution is limited to the lesser of such shareholder s pro rata share
+of the claim or the amount distributed to the shareholder, and any liability of the shareholder would be barred after the third
+anniversary of the dissolution. However, it is our intention to redeem our public shares as soon as reasonably possible following
+the 12th month (or 18th month, if extended) from the
+closing of this offering in the event we do not complete our business combination and, therefore, we do not intend to comply with
+the foregoing procedures.
+
+ 
+
+Because we will not
+be complying with Section 280, Section 281(b) of the DGCL requires us to adopt a plan, based on facts known to us
+at such time that will provide for our payment of all existing and pending claims or claims that may be potentially brought against
+us within the 10 years following our dissolution. However, because we are a blank check company, rather than an operating
+company, and our operations will be limited to searching for prospective target businesses to acquire, the only likely claims to
+arise would be from our vendors (such as lawyers, investment bankers, etc.) or prospective target businesses. If our plan
+of distribution complies with Section 281(b) of the DGCL, any liability of shareholders with respect to a liquidating
+distribution is limited to the lesser of such shareholder s pro rata share of the claim or the amount distributed to the
+shareholder, and any liability of the shareholder would likely be barred after the third anniversary of the dissolution. We cannot
+assure you that we will properly assess all claims that may be potentially brought against us. As such, our shareholders could
+potentially be liable for any claims to the extent of distributions received by them (but no more) and any liability of our shareholders
+may extend beyond the third anniversary of such date. Furthermore, if the pro rata portion of our trust account distributed to
+our public shareholders upon the redemption of our public shares in the event we do not complete our initial business combination
+within 12 months from the closing of this offering (or up to 18 months, if we extend the time to complete a business combination
+as described in this prospectus) is not considered a liquidating distribution under Delaware law and such redemption distribution
+is deemed to be unlawful, then pursuant to Section 174 of the DGCL, the statute of limitations for claims of creditors could
+then be six years after the unlawful redemption distribution, instead of three years, as in the case of a liquidating
+distribution.
+
+ 
+
+Because we are not limited to a particular
+industry, sector or any specific target businesses with which to pursue our initial business combination, you will be unable to
+ascertain the merits or risks of any particular target business operations.
+
+ 
+
+Although we intend to
+we intend to leverage the knowledge, expertise, capabilities and deep industry relationships of our management team and board of
+directors to focus on biotechnology companies with the potential to capitalize on the growing biotechnology sector in North America
+and the Asia-Pacific region. We may seek to complete a business combination with an operating company in any industry or sector
+(excluding China, Hong Kong and Macau). However, we will not, under our amended and restated certificate of incorporation,
+be permitted to complete our business combination with another blank check company or similar company with nominal operations.
+Because we have not yet selected or approached any specific target business with respect to a business combination, there is no
+basis to evaluate the possible merits or risks of any particular target business s operations, results of operations, cash
+flows, liquidity, financial condition or prospects. To the extent we complete our business combination, we may be affected by numerous
+risks inherent in the business operations with which we combine. For example, if we combine with a financially unstable business
+or an entity lacking an established record of revenues or earnings, we may be affected by the risks inherent in the business and
+operations of a financially unstable or a development stage entity. Although our officers and directors will endeavor to evaluate
+the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all the significant
+risk factors or that we will have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our
+control and leave us with no ability to control or reduce the chances that those risks will adversely impact a target business.
+We also cannot assure you that an investment in our units will ultimately prove to be more favorable to investors than a direct
+investment, if such opportunity were available, in a business combination target. Accordingly, any shareholders who choose to remain
+shareholders following the business combination could suffer a reduction in the value of their shares. Such shareholders are unlikely
+to have a remedy for such reduction in value.
+
+ 
+
+ 45 
+
+ Table of Contents 
+
+ 
+
+ 
+
+Past performance by our management team,
+our advisors and our founders may not be indicative of future performance of an investment in us.
+
+ 
+
+Information regarding
+performance by, or businesses associated with our management team and our founders and their affiliates is presented for informational
+purposes only. Past performance by our management team and our founders is not a guarantee either (i) of success with respect
+to any business combination we may consummate or (ii) that we will be able to locate a suitable candidate for our initial
+business combination. Majority of our officers, directors and advisors have not had management experience with special purpose
+acquisition corporations in the past. You should not rely on the historical record of our management team s, our advisors 
+or our founders respective performance as indicative of our future performance of an investment in us or the returns we
+will, or are likely to, generate going forward. Furthermore, an investment in us is not an investment in our founders or their
+affiliates.
+
+ 
+
+We may seek acquisition opportunities
+in industries or sectors which may or may not be outside of our management s area of expertise.
+
+ 
+
+Although we intend to
+we intend to focus on the growing biotechnology sector in North America and the Asia-Pacific region, we will consider a business
+combination outside of our management s area of expertise if a business combination candidate is presented to us and we determine
+that such candidate offers an attractive acquisition opportunity for our company. Although our management will endeavor to evaluate
+the risks inherent in any particular business combination candidate, we cannot assure you that we will adequately ascertain or
+assess all the significant risk factors. We also cannot assure you that an investment in our units will not ultimately prove to
+be less favorable to investors in this offering than a direct investment, if an opportunity were available, in a business combination
+candidate. In the event we elect to pursue an acquisition outside of the areas of our management s expertise, our management s
+expertise may not be directly applicable to its evaluation or operation, and the information contained in this prospectus regarding
+the areas of our management s expertise would not be relevant to an understanding of the business that we elect to acquire.
+As a result, our management may not be able to adequately ascertain or assess all the significant risk factors. Accordingly, any
+shareholders who choose to remain shareholders following our business combination could suffer a reduction in the value of their
+shares. Such shareholders are unlikely to have a remedy for such reduction in value.
+
+ 
+
+Although we have identified general
+criteria and guidelines that we believe are important in evaluating prospective target businesses, we may enter into our initial
+business combination with a target that does not meet such criteria and guidelines, and as a result, the target business with which
+we enter into our initial business combination may not have attributes entirely consistent with our general criteria and guidelines.
+
+ 
+
+Although
+we have identified general criteria and guidelines for evaluating prospective target businesses, it is possible that a target business
+with which we enter into our initial business combination will not have all of these positive attributes. If we complete our initial
+business combination with a target that does not meet some or all of these criteria and guidelines, such combination may not be
+as successful as a combination with a business that does meet all of our general criteria and guidelines. Even
+if we are able to identify and enter into an initial business combination with a target business that is focused on and committed
+to ESG principles, there can be no guarantee that such business combination will succeed in creating long-term value for the company s
+stockholders. In addition, if we announce a prospective business
+combination with a target that does not meet our general criteria and guidelines, a greater number of shareholders may exercise
+their redemption rights, which may make it difficult for us to meet any closing condition with a target business that requires
+us to have a minimum net worth or a certain amount of cash. In addition, if shareholder approval of the transaction is required
+by law, or we decide to obtain shareholder approval for business or other legal reasons, it may be more difficult for us to attain
+shareholder approval of our initial business combination if the target business does not meet our general criteria and guidelines.
+If we are unable to complete our initial business combination, our public shareholders may receive only approximately $10.20 per
+share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. In certain
+circumstances, our public shareholders may receive less than $10.20 per share on the redemption of their shares. See "— If
+third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount
+received by shareholders may be less than $10.20 per share" and other risk factors in this section.
+
+ 
+
+ 46 
+
+ Table of Contents 
+
+ 
+
+ 
+
+We may seek acquisition opportunities
+with an early stage company, a financially unstable business or an entity lacking an established record of revenue or earnings,
+which could subject us to volatile revenues or earnings or difficulty in retaining key personnel.
+
+ 
+
+To the extent we complete
+our initial business combination with an early stage company such as a pre-revenue entity with a limited operating history, a financially
+unstable business, or an entity lacking an established record of revenues or earnings, we may be affected by numerous risks inherent
+in the operations of the business with which we combine. These risks include investing in a business without a proven business
+model and with limited historical financial data, a lack of revenues or earnings and difficulties in obtaining and retaining key
+personnel. Although our officers and directors will endeavor to evaluate the risks inherent in a particular target business, we
+may not be able to properly ascertain or assess all the significant risk factors and we may not have adequate time to complete
+due diligence. Furthermore, some of these risks may be outside of our control and leave us with no ability to control or reduce
+the chances that those risks will adversely impact a target business.
+
+ 
+
+We are not required to obtain an opinion
+from an independent investment banking firm or from an independent accounting firm, and consequently, you may have no assurance
+from an independent source that the price we are paying for the business is fair to our company from a financial point of view.
+
+ 
+
+Unless we complete our
+business combination with an affiliated entity or our board cannot independently determine the fair market value of the target
+business or businesses, we are not required to obtain an opinion from an independent investment banking firm that is a member of
+FINRA or from an independent accounting firm that the price we are paying is fair to our company from a financial point of view.
+If no opinion is obtained, our shareholders will be relying on the judgment of our board of directors, who will determine fair
+market value based on standards generally accepted by the financial community. Such standards used will be disclosed in our proxy
+solicitation or tender offer materials, as applicable, related to our initial business combination.
+
+ 
+
+Resources could be wasted in researching
+acquisitions that are not completed, which could materially adversely affect subsequent attempts to locate and acquire or merge
+with another business. If we are unable to complete our initial business combination, our public shareholders may receive only
+approximately $10.20 per share, or less than such amount in certain circumstances, on the liquidation of our trust account and
+our warrants will expire worthless.
+
+ 
+
+We anticipate that the
+investigation of each specific target business and the negotiation, drafting and execution of relevant agreements, disclosure documents
+and other instruments will require substantial management time and attention and substantial costs for accountants, attorneys and
+others. If we decide not to complete a specific initial business combination, the costs incurred up to that point for the proposed
+transaction likely would not be recoverable. Furthermore, if we reach an agreement relating to a specific target business, we may
+fail to complete our initial business combination for any number of reasons including those beyond our control. Any such event
+will result in a loss to us of the related costs incurred which could materially adversely affect subsequent attempts to locate
+and acquire or merge with another business. If we are unable to complete our initial business combination, our public shareholders
+may receive only approximately $10.20 per share on the liquidation of our trust account and our warrants will expire worthless.
+In certain circumstances, our public shareholders may receive less than $10.20 per share on the redemption of their shares. See
+"— If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share
+redemption amount received by shareholders may be less than $10.20 per share" and other risk factors in this section.
+
+ 
+
+We may attempt to simultaneously complete
+business combinations with multiple prospective targets, which may hinder our ability to complete our business combination and
+give rise to increased costs and risks that could negatively impact our operations and profitability.
+
+ 
+
+If we determine to simultaneously
+acquire several businesses that are owned by different sellers, we will need for each of such sellers to agree that our purchase
+of its business is contingent on the simultaneous closings of the other business combinations, which may make it more difficult
+for us, and delay our ability, to complete our initial business combination. With multiple business combinations, we could also
+face additional risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence
+investigations (if there are multiple sellers) and the additional risks associated with the subsequent assimilation of the operations
+and services or products of the acquired companies in a single operating business. If we are unable to adequately address these
+risks, it could negatively impact our profitability and results of operations.
+
+ 
+
+ 47 
+
+ Table of Contents 
+
+ 
+
+ 
+
+We may have a limited ability to assess
+the management of a prospective target business and, as a result, may complete our initial business combination with a target business
+whose management may not have the skills, qualifications or abilities to manage a public company, which could, in turn, negatively
+impact the value of our shareholders investment in us.
+
+ 
+
+When evaluating the
+desirability of effecting our initial business combination with a prospective target business, our ability to assess the target
+business s management may be limited due to a lack of time, resources or information. Our assessment of the capabilities
+of the target s management, therefore, may prove to be incorrect and such management may lack the skills, qualifications
+or abilities we suspected. Should the target s management not possess the skills, qualifications or abilities necessary to
+manage a public company, the operations and profitability of the post-combination business may be negatively impacted. Accordingly,
+any shareholders who choose to remain shareholders following the business combination could suffer a reduction in the value of
+their shares. Such shareholders are unlikely to have a remedy for such reduction in value.
+
+ 
+
+The officers and directors
+of an acquisition candidate may resign upon completion of our initial business combination. The departure of a business combination
+target s key personnel could negatively impact the operations and profitability of our post-combination business. The role
+of an acquisition candidate s key personnel upon the completion of our initial business combination cannot be ascertained
+at this time. Although we contemplate that certain members of an acquisition candidate s management team will remain associated
+with the acquisition candidate following our initial business combination, it is possible that members of the management of an
+acquisition candidate will not wish to remain in place.
+
+ 
+
+We may attempt to complete our initial
+business combination with a private company about which little information is available, which may result in a business combination
+with a company that is not as profitable as we suspected, if at all.
+
+ 
+
+In pursuing our acquisition
+strategy, we may seek to complete our initial business combination with a privately held company. Very little public information
+generally exists about private companies, and we could be required to make our decision on whether to pursue a potential initial
+business combination on the basis of limited information, which may result in a business combination with a company that is not
+as profitable as we suspected, if at all.
+
+ 
+
+We may only be able to complete one
+business combination with the proceeds of this offering and the sale of the private units, which will cause us to be solely dependent
+on a single business which may have a limited number of products or services. This lack of diversification may negatively impact
+our operations and profitability.
+
+ 
+
+Of the net proceeds
+from this offering and the sale of the private units, up to $61,200,000 (or $70,380,000 if the underwriters over-allotment
+option is exercised in full) will be available to complete our business combination and pay related fees and expenses (which includes
+up to approximately $2,100,000, or up to approximately $2,415,000 if the over-allotment option is exercised in full, for the payment
+of deferred underwriting commissions).
+
+ 
+
+We may complete our
+business combination with a single target business or multiple target businesses simultaneously or within a short period of time.
+However, we may not be able to complete our business combination with more than one target business because of various factors,
+including the existence of complex accounting issues and the requirement that we prepare and file pro forma financial statements
+with the SEC that present operating results and the financial condition of several target businesses as if they had been operated
+on a combined basis. By completing our initial business combination with only a single entity, our lack of diversification may
+subject us to numerous economic, competitive and regulatory developments. Further, we would not be able to diversify our operations
+or benefit from the possible spreading of risks or offsetting of losses, unlike other entities which may have the resources to
+complete several business combinations in different industries or different areas of a single industry. In addition, we intend
+to focus our search for an initial business combination in a single industry. Accordingly, the prospects for our success may be:
+
+ 
+
+ solely dependent upon the performance of a single business,
+property or asset, or
+
+ 
+
+ dependent upon the development or market acceptance of
+a single or limited number of products, processes or services.
+
+ 
+
+ 48 
+
+ Table of Contents 
+
+ 
+
+ 
+
+This lack of diversification
+may subject us to numerous economic, competitive and regulatory developments, any or all of which may have a substantial adverse
+impact upon the particular industry in which we may operate subsequent to our business combination.
+
+ 
+
+As the number of special purpose acquisition
+companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive
+targets. This could increase the cost of our initial business combination and could even result in our inability to find a target
+or to consummate an initial business combination.
+
+ 
+
+In recent years,
+the number of special purpose acquisition companies that have been formed has increased substantially. Many potential targets for
+special purpose acquisition companies have already entered into an initial business combination, and there are still many special
+purpose acquisition companies seeking targets for their initial business combination, as well as many such companies currently
+in registration. As a result, and because our pool is limited to companies that conduct principal of their business outside of
+China (including Hong Kong and Macau), fewer attractive targets may be available, and it may require more time, more effort
+and more resources to identify a suitable target and to consummate an initial business combination. Our amended and restated certificate
+of incorporation to be adopted immediately prior to the effectiveness of the registration statement of which this prospectus forms
+a part will prohibit us from undertaking our initial business combination with any company being based in or having the majority
+of the company s operations in China (including Hong Kong and Macau).
+
+ 
+
+In addition, because
+there are more special purpose acquisition companies seeking to enter into an initial business combination with available targets,
+the competition for available targets with attractive fundamentals or business models may increase, which could cause targets companies
+to demand improved financial terms. Attractive deals could also become scarcer for other reasons, such as economic or industry
+sector downturns, geopolitical tensions, or increases in the cost of additional capital needed to close business combinations or
+operate targets post-business combination. This could increase the cost of, delay or otherwise complicate or frustrate our ability
+to find and consummate an initial business combination, and may result in our inability to consummate an initial business combination
+on terms favorable to our investors altogether.
+
+ 
+
+We may be subject to an increased rate
+of tax on our income if we are treated as a personal holding company.
+
+ 
+
+Depending on the date
+and size of our initial business combination, it is possible that we could be subject to a second level of U.S. federal income
+tax on a portion of our income if we are determined to be a personal holding company, or PHC, for U.S. federal income tax purposes.
+A U.S. corporation generally will be classified as a PHC for U.S. federal income tax purposes in a given taxable year if (i) at
+any time during the last half of such taxable year, five or fewer individuals (without regard to their citizenship or residency
+and including as individuals for this purpose certain entities such as certain tax-exempt organizations, pension funds and charitable
+trusts) own or are deemed to own (pursuant to certain constructive ownership rules) more than 50% of the stock of the corporation
+by value and (ii) at least 60% of the corporation s adjusted ordinary gross income, as determined for U.S. federal income
+tax purposes, for such taxable year consists of PHC income (which includes, among other things, dividends, interest, certain royalties,
+annuities and, under certain circumstances, rents). See the section of this prospectus entitled "United States Federal Income
+Tax Considerations — Personal Holding Company Status" for more detailed information.
+
+ 
+
+There may be tax consequences to our
+business combinations that may adversely affect us.
+
+ 
+
+While we expect to undertake
+any merger or acquisition so as to minimize taxes both to the acquired business and/or asset and us, such business combination
+might not meet the statutory requirements of a tax-free reorganization, or the parties might not obtain the intended tax-free treatment
+upon a transfer of shares or assets. A non-qualifying reorganization could result in the imposition of substantial taxes.
+
+ 
+
+We may reincorporate in another jurisdiction
+in connection with our initial business combination and such reincorporation may result in taxes imposed on shareholders or warrant
+holders.
+
+ 
+
+We may, in connection with our initial
+business combination and subject to requisite shareholder approval under the DGCL, reincorporate in the jurisdiction in which the
+target company or business is located or in another jurisdiction. The transaction may require a shareholder or warrant holder to
+recognize taxable income in the jurisdiction in which the shareholder or warrant holder is a tax resident or in which its members
+are resident if it is a tax transparent entity (or may otherwise result in adverse tax consequences). We do not intend to make
+any cash distributions to shareholders or warrant holders to pay such taxes. Shareholders or warrant holders may be subject to
+withholding taxes or other taxes with respect to their ownership of us after the reincorporation.
+
+ 
+
+ 49 
+
+ Table of Contents 
+
+ 
+
+ 
+
+Focus on biotechnology and green
+technology sectors with an emphasis on ESG could negatively impact the operations and profitability of our post-combination
+business or expose us to additional risks.
+
+ 
+
+Increasing attention
+to climate change, increasing societal expectations on businesses to address climate change, and potential consumer use of substitutes
+to energy commodities may result in increased costs, reduced demand for our post-combination business s products, reduced
+profits, increased investigations and litigation, and negative impacts on its stock price and access to capital markets.
+
+ 
+
+In addition,
+organizations that provide information to investors on corporate governance and related matters have developed rating
+processes for evaluating business entities on their approach to ESG matters. Currently, there are no universal standards for
+such scores or ratings especially in biotech and green technology sectors, but the importance of sustainability evaluations is becoming more broadly accepted by investors and
+stockholders. Such ratings are used by some investors to inform their investment and voting decisions. Additionally, certain
+investors use these scores to benchmark businesses against their peers and if a business entity is perceived as lagging,
+these investors may engage with such entities to require improved ESG disclosure or performance. Moreover, certain members of
+the broader investment community may consider a business entity s sustainability score as a reputational or other
+factor in making an investment decision. Consequently, a low sustainability score could result in exclusion of our
+post-combination stock from consideration by certain investment funds, engagement by investors seeking to improve such scores
+and a negative perception of our operation by certain investors.
+
+ 
+
+We are likely to seek business combination
+opportunities with a company within the biotechnology industry, which companies typically lack an established record of revenue,
+cash flow or earnings and therefore are valued based on certain assumptions and expectations that may not prove to be accurate
+and subject us to risks such as volatile revenues, cash flows or earnings or difficulty in retaining key personnel.
+
+ 
+
+ 50 
+
+ Table of Contents 
+
+ 
+
+ 
+
+The acquisition
+candidates that we intend to evaluate may be companies within the biotechnology industry and many may not have any approved products
+or revenues. These companies typically lack an established record of revenues or earnings, meaning that the valuation of such business
+may not be able to be derived from conventional cash flow methods for profitable business. Instead, valuations may be based on
+assumptions or expectations relating to such companies product candidates in development and future clinical and sales milestones,
+which may never be realized or achieved fully, or at all, given the possibility of failure of the product candidates in clinical
+trials or their failure to obtain regulatory approval, or their obsolescence due to a competitor s invention or other substitute.
+As a result, the valuation that we assign to a target business may be inaccurate. Additionally, we may be affected by numerous
+risks inherent in the operations of the business with which we combine. These risks include volatile revenues or earnings and difficulties
+in obtaining and retaining key personnel. Although our officers and directors will endeavor to evaluate the risks inherent in a
+particular target business, we may not be able to properly ascertain or assess all of the significant risk factors and we may not
+have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with
+no ability to control or reduce the chances that those risks will adversely impact a target business.
+
+ 
+
+There are risks related to the biotechnology
+industry to which we may be subject.
+
+ 
+
+Business combinations
+with companies with operations in the healthcare and biotechnology industry entail special considerations and risks. If we are
+successful in completing a business combination with a target business with operations in the healthcare industry, we will be subject
+to, and possibly adversely affected by, the following risks, including but not limited to:
+
+ 
+
+ Clinical studies of our
+pipeline programs may not present data which is satisfactory for regulatory approval for such programs.
+
+ 
+
+ Out-licensed technology
+or product can be returned by licensee, thereby cancelling a part or all of the licensing terms including financial compensation
+and/or revenue sharing agreements.
+
+ 
+
+ Competition could reduce
+profit margins.
+
+ 
+
+ Our inability to comply
+with governmental regulations affecting the healthcare industry could negatively affect our operations.
+
+ 
+
+ An inability to license
+or enforce intellectual property rights on which our business may depend.
+
+ 
+
+ The success of our planned
+business following consummation of our initial business combination may depend on maintaining a well-secured business and technology
+infrastructure.
+
+ 
+
+ If we are required to obtain
+governmental approval of our products, the production of our products could be delayed and we could be required to engage in a
+lengthy and expensive approval process that may not ultimately be successful.
+
+ 
+
+ Changes in the healthcare
+related wellness industry and markets for such products affecting our customers or retailing practices could negatively impact
+customer relationships and our results of operations.
+
+ 
+
+ The biotech industry is
+susceptible to significant liability exposure. If liability claims are brought against us following a business combination, it
+could materially adversely affect our operations.
+
+ 
+
+ Dependence of our operations
+upon third-party suppliers, manufacturers or contractors whose failure to perform adequately could disrupt our business.
+
+ 
+
+ A disruption in supply could
+adversely impact our business.
+
+ 
+
+Any of the foregoing
+could have an adverse impact on our operations following a business combination. However, our efforts in identifying prospective
+target businesses will not be limited to the biotech industry. Accordingly, if we acquire a target business in another industry,
+these risks will likely not affect us and we will be subject to other risks attendant with the specific industry in which we operate
+or target business which we acquire, none of which can be presently ascertained.
+
+ 
+
+You may experience
+difficulties in effecting service of legal process, enforcing foreign judgments or bringing actions in Taiwan against
+us or our management named in the prospectus based on foreign laws. 
+
+ 
+
+We are a company
+incorporated under the laws of the State of Delaware, but certain members of our management are located in Taiwan. As a result,
+it may be difficult for you to effect service of process upon us or those persons inside Taiwan. It may also be difficult
+for you to enforce in U.S. courts judgments obtained in U.S. courts based on the civil liability
+provisions of the U.S. federal securities laws against us and our officers and directors as none of them currently resides in
+the United States or has substantial assets located in the United States. In addition, there is uncertainty as to whether the courts of Taiwan would
+recognize or enforce judgments of U.S. courts against us or such persons predicated upon the civil liability
+provisions of the securities laws of the United States or any state.
+
+ 
+
+The recognition
+and enforcement of foreign judgments are provided for under the Taiwan Civil Procedures Law. Taiwan courts may
+recognize and enforce foreign judgments in accordance with the requirements of the Taiwan Civil Procedures
+Law based either on treaties between Taiwan and the country where the judgment is made or on principles of reciprocity
+between jurisdictions. Taiwan does not have any treaties or other forms of written arrangement with the United States
+that provide for the reciprocal recognition and enforcement of foreign judgments. In addition, according to the Taiwan Civil
+Procedures Law, the Taiwan courts will not enforce a foreign judgment against us or our directors and
+officers if they decide that the judgment violates the basic principles of Taiwan laws or national sovereignty, security
+or public interest. As a result, it is uncertain whether and on what basis a Taiwan court would enforce a
+judgment rendered by a court in the United States.
+
+ 
+
+Risks Related to Our Management
+
+ 
+
+Our ability to successfully complete
+our initial business combination and to be successful thereafter will be totally dependent upon the efforts of members of our management
+team, some of whom may join us following our initial business combination. The loss of such people could negatively impact the
+operations and profitability of our post-combination business.
+
+ 
+
+Our ability to successfully
+complete our business combination is dependent upon the efforts of members of our management team. The role of members of our management
+team in the target business, however, cannot presently be ascertained. Although some members of our management team may remain
+with the target business in senior management or advisory positions following our business combination, it is likely that some
+or all of the management of the target business will remain in place. While we intend to closely scrutinize any individuals we
+engage after our initial business combination, we cannot assure you that our assessment of these individuals will prove to be correct.
+These individuals may be unfamiliar with the requirements of operating a company regulated by the SEC, which could cause us to
+have to expend time and resources helping them become familiar with such requirements.
+
+ 
+
+In addition, the officers
+and directors of an acquisition candidate may resign upon completion of our initial business combination. The departure of a business
+combination target s key personnel could negatively impact the operations and profitability of our post-combination business.
+The role of an acquisition candidate s key personnel upon the completion of our initial business combination cannot be ascertained
+at this time. Although we contemplate that certain members of an acquisition candidate s management team will remain associated
+with the acquisition candidate following our initial business combination, it is possible that members of the management of an
+acquisition candidate will not wish to remain in place. The loss of key personnel could negatively impact the operations and profitability
+of our post-combination business.
+
+ 
+
+Members of our management team may negotiate
+employment or consulting agreements with a target business in connection with a particular business combination. These agreements
+may provide for them to receive compensation following our business combination and as a result, may cause them to have conflicts
+of interest in determining whether a particular business combination is the most advantageous.
+
+ 
+
+Members of our management
+team may be able to remain with the company after the completion of our business combination only if they are able to negotiate
+employment or consulting agreements in connection with the business combination. Such negotiations would take place simultaneously
+with the negotiation of the business combination and could provide for such individuals to receive compensation in the form of
+cash payments and/or our securities for services they would render to us after the completion of the business combination. The
+personal and financial interests of such individuals may influence their motivation in identifying and selecting a target business.
+However, we believe the ability of such individuals to remain with us after the completion of our business combination will not
+be the determining factor in our decision as to whether or not we will proceed with any potential business combination. There is
+no certainty, however, that any members of our management team will remain with us after the completion of our business combination.
+We cannot assure you that any members of our management team will remain in senior management or advisory positions with us. The
+determination as to whether any members of our management team will remain with us will be made at the time of our initial business
+combination.
+
+ 
+
+Our officers and directors may allocate
+their time to other businesses and may become officers or directors of other special purpose acquisition companies including a
+special purpose acquisition company that certain of our directors are currently serving as officer and directors of, thereby causing
+conflicts of interest in their determination as to how much time to devote to our affairs and whether to present a target to us
+instead of our competitors. This conflict of interest could have a negative impact on our ability to complete our initial business
+combination.
+
+ 
+
+Our officers and directors have fiduciary responsibility to dedicate substantially
+all their business time to their respective affairs and their respective portfolio companies. However, this responsibility does not require
+any of our officers or directors to commit his or her full time to our affairs in particular, which may result in a conflict of interest
+in allocating their time between our operations and our search for a business combination and their other businesses, including other
+business endeavors for which he or she may be entitled to substantial compensation. Furthermore, our officer and directors may become
+an officer or director of another special purpose acquisition company with a class of securities registered under the Securities Exchange Act of 1934,
+as amended, or the Exchange Act even before we enter a definitive agreement regarding our initial business combination. As
+a matter of fact, certain of our officer and directors are also officer and directors of other SPACs listed or to be listed on
+Nasdaq. We do not intend to have any full-time employees prior to the completion of our initial
+business combination. In addition, each of our officers and certain of our directors are employed by or affiliated with our founders,
+which makes investments in securities or other interests of or relating to companies in industries we may target for our initial business
+combination. Our independent directors also serve as officers or board members for other entities. If our officers and directors 
+other business affairs require them to devote substantial amounts of time to such affairs in excess of their current commitment levels,
+it could limit their ability to devote time to our affairs; or if they have fiduciary duty to present a target company to our competitor
+instead of us, which may have a negative impact on our ability to complete our initial business combination. For a complete discussion
+of our officers and directors other business affairs, please see the section of this prospectus entitled "Management — Conflicts
+of Interest."
+
+ 
+
+ 51 
+
+ Table of Contents 
+
+ 
+
+ 
+
+Certain of our officers and directors
+are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended
+to be conducted by us and, accordingly, may have conflicts of interest in allocating their time and determining to which entity
+a particular business opportunity should be presented.
+
+ 
+
+Following the completion
+of this offering and until we consummate our initial business combination, we intend to engage in the business of identifying and
+combining with one or more businesses. Our officers and directors are, and may in the future become, affiliated with entities (such
+as operating companies or investment vehicles) that are engaged in a similar business.
+
+ 
+
+Our officers and directors
+also may become aware of business opportunities which may be appropriate for presentation to us and the other entities in the future
+to which they owe certain fiduciary or contractual duties, including our founders affiliates. Accordingly, they may have
+conflicts of interest in determining to which entity a particular business opportunity should be presented. These conflicts may
+not be resolved in our favor and a potential target business may be presented to another entity prior to its presentation to us.
+Our amended and restated certificate of incorporation will provide that we renounce our interest in any corporate opportunity offered
+to any director or officer unless such opportunity is expressly offered to such person solely in his or her capacity as a director
+or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise
+be reasonable for us to pursue.
+
+ 
+
+For a complete discussion
+of our officers and directors business affiliations and the potential conflicts of interest that you should be aware
+of, please see the sections of this prospectus entitled "Management — Officers, Directors and Director Nominees,"
+"Management — Conflicts of Interest" and "Certain Relationships and Related Party Transactions."
+
+ 
+
+Following the closing of this offering,
+certain of our executive officers and directors will be located in Taiwan; therefore, investors may not be able to enforce federal
+securities laws or their other legal rights upon those officers and directors located outside the United States.
+
+ 
+
+Following
+the closing of this offering, except one officer and one independent director located in the United States, the rest of the our
+officers and directors are located in Taiwan. As a result, it may be difficult, or in some cases not possible, for investors in
+the United States to enforce their legal rights, to effect service of process upon those officers and directors located outside
+the United States, to enforce judgments of United States courts predicated upon civil liabilities and criminal penalties on them
+under United States securities laws.
+
+ 
+
+Members
+ of our management team may in the future be involved
+in governmental investigations and civil litigation relating to the business affairs of companies with which they are, were or
+may in the future be affiliated with.
+
+ 
+
+Members of our management
+team may in the future be involved in governmental investigations and civil litigation relating to the business affairs of companies
+with which they are, were or may in the future be affiliated with. Any such investigations or litigations may divert our management
+team s attention and resources away from searching for an initial business combination, may be detrimental to our reputation,
+and thus may negatively affect our ability to complete an initial business combination.
+
+ 
+
+We may become involved in litigation
+that may materially adversely affect us.
+
+ 
+
+From time to time, we
+may become involved in various legal proceedings relating to matters incidental to the ordinary course of our business, including
+litigation and claims, and governmental and other regulatory investigations and proceedings. Such matters can be time-consuming,
+divert management s attention and resources, cause us to incur significant expenses or liability or require us to change
+our business practices. Because of the potential risks, expenses and uncertainties of litigation, we may, from time to time, settle
+disputes, even where we believe that we have meritorious claims or defenses. Because litigation is inherently unpredictable, we
+cannot assure you that the results of any of these actions will not have a material adverse effect on our business.
+
+ 
+
+Our share price may
+be volatile and, in the past, companies that have experienced volatility in the market price of their stock have been subject to
+securities litigation, including class action litigation. We may be the target of this type of litigation in the future.
+
+ 
+
+Litigation of this type
+could result in substantial costs and diversion of management s attention and resources, which could have a material adverse
+effect on our business, financial condition, and results of operations. Any adverse determination in litigation could also subject
+us to significant liabilities.
+
+ 
+
+Our founders and their respective affiliates
+may have competitive pecuniary interests that conflict with our interests.
+
+ 
+
+We have not adopted
+a policy that expressly prohibits our founders or their respective affiliates from having a direct or indirect pecuniary or financial
+interest in any investment to be acquired or disposed of by us or in any transaction to which we are a party or have an interest.
+We do not have a policy that expressly prohibits any such persons from engaging for their own account in business activities of
+the types conducted by us. Accordingly, such persons or entities may have a conflict between their interests and ours.
+
+ 
+
+We may engage in a business combination
+with one or more target businesses that have relationships with entities that may be affiliated with our founders which may raise
+potential conflicts of interest.
+
+ 
+
+In light of the involvement
+of our officers and directors with other entities, we may decide to acquire one or more businesses affiliated with our founders
+or their respective affiliates. Our officers and directors also serve as officers and board members for other entities, including,
+without limitation, those described under the section of this prospectus entitled "Management — Conflicts
+of Interest." Such entities may compete with us for business combination opportunities. Our founders are not currently aware
+of any specific opportunities for us to complete our business combination with any entities with which they are affiliated, and
+there have been no preliminary discussions concerning a business combination with any such entity or entities. Although we will
+not be specifically focusing on, or targeting, any transaction with any affiliated entities, we would pursue such a transaction
+if we determined that such affiliated entity met our criteria for a business combination as set forth in the section of this prospectus
+entitled "Proposed Business — Sources of Target Businesses" and such transaction was approved by a
+majority of our disinterested directors. Despite our agreement to obtain an opinion from an independent investment banking firm
+that is a member of FINRA, or from an independent accounting firm, regarding the fairness to our company from a financial point
+of view of a business combination with one or more domestic or international businesses affiliated with our founders or their respective
+affiliates, potential conflicts of interest still may exist and, as a result, the terms of the business combination may not be
+as advantageous to our public shareholders as they would be absent any conflicts of interest.
+
+ 
+
+ 52 
+
+ Table of Contents 
+
+ 
+
+ 
+
+None of US Tiger or, any of its affiliates
+has an obligation to provide us with potential investment opportunities or to devote any specified amount of time or support to
+our company s business.
+
+ 
+
+Although we expect
+we may benefit from US Tiger and its affiliates networks of relationships and processes for sourcing and evaluating potential
+business combination targets, neither it nor any of its affiliates has any legal or contractual obligation to seek on our behalf
+or present to us investment opportunities that might be suitable for our business, and they may allocate any such opportunities
+at their discretion to us or other parties. We have no investment management, advisory, consulting or other agreement in place
+with US Tiger or any of its affiliates that obligates them to undertake efforts on our behalf or that govern the manner in which
+they will allocate investment opportunities. Moreover, even if US Tiger or one of its affiliates refers an opportunity to us, there
+can be no assurance that such an opportunity will result in an acquisition agreement or a business combination.
+
+ 
+
+After consummation of this offering,
+we may engage US Tiger to act as our advisor in connection with our business combination and we will agree to pay them an additional
+fee upon consummation of our business combination.
+
+ 
+
+Because Mr. Xuedong
+(Tony) Tian, our Chief Financial Officer, is the Managing Director and Head of Capital Markets of US Tiger, we may utilize his
+affiliation with US Tiger during our search for suitable targets. If that occurs, we may engage US Tiger to act as our advisor
+in connection with the marketing of our business combination and pay to US Tiger a fee for such services upon consummation of our
+initial business combination.
+
+ 
+
+Therefore, affiliates
+of one of our founders will have additional financial interests in the completion of the initial business combination. These financial
+interests may influence the advice any such affiliate provides us as our financial advisor, which advice would contribute to our
+decision on whether to pursue a business combination with any particular target.
+
+ 
+
+If we decide to engage US Tiger as our
+advisor in connection with a business combination, we may compete with clients of US Tiger or other affiliates of our initial stockholders
+for acquisition opportunities for our company, which could negatively impact our ability to locate a suitable business combination.
+
+ 
+
+Due to the affiliation
+between our Chief Financial Officer and US Tiger, we may engage US Tiger as our advisor in connection with a business combination.
+If that occurs, our business strategy may overlap with some of the strategies of clients of US Tiger and certain of its other affiliates.
+US Tiger is an independent investment bank. Acquisition opportunities that may be of interest to us may come to US Tiger, its clients
+or other affiliates. In addition, our officers and directors are not prohibited from engaging on business activities or becoming
+officers or directors of another special purpose acquisition company before we enter into a definitive agreement with a target.
+As a result, our affiliates are not restricted from competing with our business and none of our affiliates is required to refer
+any such opportunities to us except as may be required by our Amended and Restated Certificate of Incorporation with respect to
+certain opportunities referred to our officers and directors. Our founders and their affiliates face conflicts of interest relating
+to performing services on our behalf and allocating investment opportunities to us, and such conflicts may not be resolved in our
+favor, meaning we could find less suitable acquisition opportunities which could limit our ability to find a business combination
+that we find attractive.
+
+ 
+
+If we decide to engage US Tiger as our advisor in connection with a business
+combination, conflicts may arise from US Tiger engagement with us, its provision of services both to us, and to third-party clients,
+its affiliation with Feutune Light and TradeUP Acquisition as well as from actions undertaken by US Tiger or its affiliates for its own
+account and certain members of management who presently has, and any of them in the future may have, additional fiduciary, contractual
+or other obligations to US Tiger, Feutune Light, TradeUP Acquisition, or to clients of US Tiger, or other affiliates of our sponsor pursuant
+to which such officer or director is or will be required to present a business combination opportunity. In performing services for other
+clients and also when acting for its own account, US Tiger may take commercial steps which may have an adverse effect on us. US Tiger
+is often engaged as a financial advisor, or placement agent, to corporations and other entities and their directors and managers in connection
+with the sale of those entities, their assets or their subsidiaries. Clients generally require US Tiger to act exclusively on their behalf
+and/or for other reasons, we may be precluded from attempting to acquire securities of the business being sold or otherwise participate
+as a buyer in the transaction. Alternatively, US Tiger or an affiliate of our founders, may be a financial advisor to a target business
+that we pursue a business combination with and US Tiger, or another affiliate of our founders, may receive fees from the target business
+in connection with a business combination. US Tiger also represents potential buyer s businesses. US Tiger may be incentivized to
+direct an opportunity to one of these buyers, thereby eliminating or reducing the investment opportunity available to us. Any of US Tiger s
+other activities may, individually or in the aggregate, have an adverse effect on us, and the interests of US Tiger or its clients or
+counterparties may at times be adverse to ours.
+
+ 
+
+Since our initial shareholders will
+lose their entire investment in us if our business combination is not completed, a conflict of interest may arise in determining
+whether a particular business combination target is appropriate for our initial business combination.
+
+ 
+
+On May 13, 2022, our Chief
+Financial Officer and sponsor acquired an aggregate of 1,725,000 shares of Class B common stock, or Class B founder shares for an
+aggregate purchase price of $25,000. Our sponsor has committed to transfer an aggregated amount of 60,000 Class B founder shares to certain
+of our directors, officers, and/or their designees prior to the closing of this offering at the original purchase price. Prior to the
+initial investment in the company of $25,000 by our sponsor, the company had no assets, tangible or intangible. The number of founder
+shares issued was determined based on the expectation that such founder shares would represent 20% of the outstanding shares after this
+offering (excluding the sale of the private units and assuming our founders do not purchase public shares in this offering). In addition,
+our sponsor has committed to purchase an aggregate of 414,000 (or 450,000 if the underwriters over-allotment option is exercised
+in full) private units, at $10.00 per unit, for a purchase price of $4,140,000 (or $4,500,000 if the underwriters over-allotment
+option is exercised in full). The founder shares and private units will be worthless if we do not complete an initial business combination.
+Our initial shareholders have agreed (A) to vote any shares owned by them in favor of any proposed business combination and (B) not
+to redeem any founder shares or private shares in connection with a shareholder vote to approve a proposed initial business combination.
+In addition, we may obtain loans from our founders. The personal and financial interests of our founders may influence their motivation
+in identifying and selecting a target business combination, completing an initial business combination and influencing the operation of
+the business following the initial business combination. These personal and financial interests of our founders may influence their motivation
+in identifying and selecting a target business combination, completing an initial business combination and influencing the operation of
+the business following the initial business combination. This risk may become more acute as the 12-month anniversary of the closing of
+this offering nears, which is the deadline for our completion of an initial business combination.
+
+ 
+
+The provisions of our amended and restated
+certificate of incorporation that relate to our pre-business combination activity (and corresponding provisions of the agreement
+governing the release of funds from our trust account) may be amended with the approval of holders of 65% of our common stock,
+which is a lower amendment threshold than that of some other blank check companies. It may be easier for us, therefore, to amend
+our then existing amended and restated certificate of incorporation and the trust agreement to facilitate the completion of an
+initial business combination that some of our shareholders may not support.
+
+ 
+
+Some other blank check
+companies have a provision in their charter which prohibits the amendment of certain of its provisions, including those which relate
+to a company s pre-business combination activity, without approval by a certain percentage of the company s shareholders.
+In those companies, amendment of these provisions requires approval by between 90% and 100% of the company s public shareholders.
+Our amended and restated certificate of incorporation will provide that any of its provisions related to pre-business combination
+activity (including the requirement to deposit proceeds of this offering and the private placement of warrants into the trust account
+and not release such amounts except in specified circumstances, and to provide redemption rights to public shareholders as described
+herein) may be amended if approved by holders of 65% of our common stock entitled to vote thereon, and corresponding provisions
+of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of 65% of our
+common stock entitled to vote thereon. In all other instances, our amended and restated certificate of incorporation may be amended
+by holders of a majority of our outstanding common stock entitled to vote thereon, subject to applicable provisions of the DGCL
+or applicable stock exchange rules. We may not issue additional securities that can vote on amendments to our then existing amended
+and restated certificate of incorporation or in our initial business combination. Our initial shareholders, who will collectively
+beneficially own up to 24.18% of our common stock upon the closing of this offering (assuming they do not purchase any units in
+this offering), will participate in any vote to amend our then existing amended and restated certificate of incorporation and/or
+trust agreement and will have the discretion to vote in any manner they choose. As a result, we may be able to amend the provisions
+of our then existing amended and restated certificate of incorporation which govern our pre-business combination behavior more
+easily than some other blank check companies, and this may increase our ability to complete a business combination with which you
+do not agree. Our shareholders may pursue remedies against us for any breach of our amended and restated certificate of incorporation.
+
+ 
+
+ 53 
+
+ Table of Contents 
+
+ 
+
+ 
+
+Our initial shareholders
+have agreed, pursuant to a letter agreement with us, that they will not propose any amendment to our then existing amended and
+restated certificate of incorporation (i) that would modify the substance or timing of our obligation to allow redemption
+in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business
+combination within 12 months from the closing of this offering (or up to 18 months, if we extend the time to complete a business
+combination as described in this prospectus), or (ii) with respect to any other material provision relating to shareholders 
+rights or pre-initial business combination activity, unless we provide our public shareholders with the opportunity to redeem their
+shares of Class A common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate
+amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable), divided by the number of then outstanding public shares. These agreements are contained
+in a letter agreement that we have entered into with our founders. Our shareholders are not parties to, or third-party beneficiaries
+of, these agreements and, as a result, will not have the ability to pursue remedies against our founders for any breach of these
+agreements. As a result, in the event of a breach, our shareholders would need to pursue a shareholder derivative action, subject
+to applicable law.
+
+ 
+
+We may be unable to obtain additional
+financing to complete our initial business combination or to fund the operations and growth of a target business, which could compel
+us to restructure or abandon a particular business combination.
+
+ 
+
+Although we believe
+that the net proceeds of this offering and the sale of the private units will be sufficient to allow us to complete our initial
+business combination, because we have not yet selected any prospective target business we cannot ascertain the capital requirements
+for any particular transaction. If the net proceeds of this offering and the sale of the private units prove to be insufficient,
+either because of the size of our initial business combination, the depletion of the available net proceeds in search of a target
+business, the obligation to repurchase for cash a significant number of shares from shareholders who elect redemption in connection
+with our initial business combination or the terms of negotiated transactions to purchase shares in connection with our initial
+business combination, we may be required to seek additional financing or to abandon the proposed business combination. We cannot
+assure you that such financing will be available on acceptable terms, if at all. To the extent that additional financing proves
+to be unavailable when needed to complete our initial business combination, we would be compelled to either restructure the transaction
+or abandon that particular business combination and seek an alternative target business candidate. If we are unable to complete
+our initial business combination, our public shareholders may receive only approximately $10.20 per share plus any pro rata interest
+earned on the funds held in the trust account (and not previously released to us to pay our taxes) on the liquidation of our trust
+account and our warrants will expire worthless. In addition, even if we do not need additional financing to complete our business
+combination, we may require such financing to fund the operations or growth of the target business. The failure to secure additional
+financing could have a material adverse effect on the continued development or growth of the target business. None of our officers,
+directors or shareholders is required to provide any financing to us in connection with or after our initial business combination.
+If we are unable to complete our initial business combination, our public shareholders may only receive approximately $10.20 per
+share on the liquidation of our trust account, and our warrants will expire worthless. In certain circumstances, our public shareholders
+may receive less than $10.20 per share on the redemption of their shares. See "— If third parties bring claims
+against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders
+may be less than $10.20 per share" and other risk factors in this section.
+
+ 
+
+ 54 
+
+ Table of Contents 
+
+ 
+
+ 
+
+Our founders and other insiders may
+exert a substantial influence on actions requiring a shareholder vote, potentially in a manner that you do not support.
+
+ 
+
+Upon the closing of
+this offering, our founders will own founder shares representing 20% of our issued and outstanding shares of common stock (excluding
+the sale of the private units and assuming our founders do not purchase public shares in this offering). Simultaneously with the
+closing of this offering, we will be issuing in 414,000 private units (or up to 450,000 private units if the underwriters 
+over-allotment option is exercised in full) to our sponsor. In addition, if our founders or their designated parties make any working
+capital loans (including extension notes), up to $3,000,000 of such loans may be converted into working capital units, at the price
+of $10.00 per unit at the option of the lenders. Such working capital units would be identical to the private units sold in the
+private placement. Accordingly, our founders along with any designated parties may exert a substantial influence on actions requiring
+a shareholder vote, potentially in a manner that you do not support, including amendments to our then existing amended and restated
+certificate of incorporation and approval of major corporate transactions. If our founders purchase any units in this offering
+or if they purchase any additional shares of common stock in the aftermarket or in privately negotiated transactions, this would
+increase their control. Factors that would be considered in making such additional purchases would include consideration of the
+current trading price of our Class A common stock. In addition, our board of directors, whose members were elected by certain
+of our initial shareholders, is and will be divided into three classes, each of which will generally serve for a term of three years
+with only one class of directors being elected in each year. We may not hold an annual meeting of shareholders to elect new directors
+prior to the completion of our business combination, in which case all of the current directors will continue in office until at
+least the completion of the business combination. If there is an annual meeting, as a consequence of our "staggered"
+board of directors, only a minority of the board of directors will be considered for election and our initial shareholders, because
+of their ownership position, will have considerable influence regarding the outcome. In addition, the founder shares, all of which
+are held by our founders, will entitle the founders to elect and remove, with or without cause, all of our directors prior to our
+initial business combination. Holders of our public shares will have no right to vote on the election of directors during such
+time. These provisions of our amended and restated certificate of incorporation may only be amended by the vote of at least 90%
+of our issued and outstanding common stock entitled to vote thereon. As a result, you will not have any influence over the election
+of directors prior to our initial business combination. Accordingly, our initial shareholders will continue to exert control at
+least until the completion of our business combination.
+
+ 
+
+Post Business Combination Risks
+
+ 
+
+Our management may not be able to maintain
+control of a target business after our initial business combination. We cannot provide assurance that, upon loss of control of
+a target business, new management will possess the skills, qualifications or abilities necessary to profitably operate such business.
+
+ 
+
+We may structure a business
+combination so that the post-transaction company in which our public shareholders own shares will own less than 100% of the equity
+interests or assets of a target business, but we will only complete such business combination if the post-transaction company owns
+or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires an interest in the target sufficient
+for the post-transaction company not to be required to register as an investment company under the Investment Company Act. We will
+not consider any transaction that does not meet such criteria. Even if the post-transaction company owns 50% or more of the voting
+securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post
+business-combination company, depending on valuations ascribed to the target and us in the business combination transaction. For
+example, we could pursue a transaction in which we issue a substantial number of new shares of Class A common stock in exchange
+for all of the outstanding capital stock of a target. In this case, we would acquire a 100% interest in the target. However, as
+a result of the issuance of a substantial number of new shares of common stock, our shareholders immediately prior to such transaction
+could own less than a majority of our outstanding shares of common stock subsequent to such transaction. In addition, other minority
+shareholders may subsequently combine their holdings resulting in a single person or group obtaining a larger share of the company s
+stock than we initially acquired. Accordingly, this may make it more likely that our management will not be able to maintain our
+control of the target business. We cannot provide assurance that, upon loss of control of a target business, new management will
+possess the skills, qualifications or abilities necessary to profitably operate such business.
+
+ 
+
+ 55 
+
+ Table of Contents 
+
+ 
+
+ 
+
+Subsequent to the completion of our
+initial business combination, we may be required to take write-downs or write-offs, restructuring and impairment or other charges
+that could have a significant negative effect on our financial condition, results of operations and our stock price, which could
+cause you to lose some or all of your investment.
+
+ 
+
+Even if we conduct extensive
+due diligence on a target business with which we combine, we cannot assure you that this diligence will surface all material issues
+that may be present inside a particular target business, that it would be possible to uncover all material issues through a customary
+amount of due diligence, or that factors outside of the target business and outside of our control will not later arise. As a result
+of these factors, we may be forced to later write-down or write-off assets, restructure our operations, or incur impairment or
+other charges that could result in our reporting losses. Even if our due diligence successfully identifies certain risks, unexpected
+risks may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Even
+though these charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of
+this nature could contribute to negative market perceptions about us or our securities. In addition, charges of this nature may
+cause us to violate net worth or other covenants to which we may be subject as a result of assuming pre-existing debt held by a
+target business or by virtue of our obtaining post-combination debt financing. Accordingly, any shareholders who choose to remain
+shareholders following the business combination could suffer a reduction in the value of their shares. Such shareholders are unlikely
+to have a remedy for such reduction in value.
+
+ 
+
+If we complete our initial business
+combination with a company with operations or opportunities outside of the United States, we would be subject to a variety
+of additional risks that may negatively impact our operations.
+
+ 
+
+If we complete our initial
+business combination with a company with operations or opportunities outside of the United States (although we will not effect
+our initial business combination with any company being based in or having the majority of the company s operations in China,
+including Hong Kong and Macau), we would be subject to any special considerations or risks associated with companies operating
+in an international setting, including any of the following:
+
+ 
+
+ higher costs and difficulties inherent in managing cross-border
+business operations and complying with different commercial and legal requirements of overseas markets;
+
+ 
+
+ rules and regulations regarding currency redemption;
+
+ 
+
+ complex corporate withholding taxes on individuals;
+
+ 
+
+ laws governing the manner in which future business combinations
+may be effected;
+
+ 
+
+ tariffs and trade barriers;
+
+ 
+
+ regulations related to customs and import/export matters;
+
+ 
+
+ longer payment cycles and challenges in collecting accounts
+receivable;
+
+ 
+
+ tax issues, such as tax law changes and variations in
+tax laws as compared to the United States;
+
+ 
+
+ currency fluctuations and exchange controls;
+
+ 
+
+ rates of inflation;
+
+ 
+
+ cultural and language differences;
+
+ 
+
+ employment regulations;
+
+ 
+
+ crime, strikes, riots, civil disturbances, terrorist attacks,
+natural disasters and wars;
+
+ 
+
+ deterioration of political relations with the United States;
+and
+
+ 
+
+ government appropriations of assets.
+
+ 
+
+We may not be able to
+adequately address these additional risks. If we were unable to do so, our operations might suffer, which may adversely impact
+our results of operations and financial condition.
+
+ 
+
+ 56 
+
+ Table of Contents 
+
+ 
+
+ 
+
+Risks Related to Our Securities
+
+ 
+
+If our securities are approved for listing,
+Nasdaq may delist our securities from trading on its exchange, which could limit investors ability to make transactions
+in our securities and subject us to additional trading restrictions.
+
+ 
+
+We have applied to have
+our units listed on Nasdaq. We expect that our units will be listed on Nasdaq on or promptly after the date of this prospectus.
+Following the date the shares of our Class A common stock and warrants are eligible to trade separately, we anticipate that
+the shares of our Class A common stock and warrants will be separately listed on Nasdaq. We cannot guarantee that our securities
+will be approved for listing on Nasdaq. Although after giving effect to this offering we expect to meet, on a pro forma basis,
+the minimum initial listing standards set forth in the Nasdaq listing standards, we cannot assure you that our securities will
+be, or will continue to be, listed on Nasdaq in the future or prior to our initial business combination. In order to continue listing
+our securities on Nasdaq prior to our initial business combination, we must maintain certain financial, distribution and stock
+price levels. Generally, we must maintain a minimum number of holders of our securities (generally 400 public holders). Additionally,
+in connection with our initial business combination, we will be required to demonstrate compliance with Nasdaq s initial
+listing requirements, which are more rigorous than Nasdaq s continued listing requirements, in order to continue to maintain
+the listing of our securities on Nasdaq. For instance, our stock price would generally be required to be at least $4.00 per share,
+and we would be required to have a minimum of 400 round lot holders (with at least 50% of such round lot holders holding securities
+with a market value of at least $2,500) of our securities. We cannot assure you that we will be able to meet those initial listing
+requirements at that time.
+
+ 
+
+If Nasdaq delists our
+securities from trading on its exchange and we are not able to list our securities on another national securities exchange, we
+expect our securities could be quoted on an over-the-counter market. If this were to occur, we could face significant material
+adverse consequences, including:
+
+ 
+
+ a limited availability of market quotations for our securities;
+
+ 
+
+ reduced liquidity for our securities;
+
+ 
+
+ a determination that our Class A common stock is a "penny stock" which will require
+brokers trading in our Class A common stock to adhere to more stringent rules and possibly result in a reduced level
+of trading activity in the secondary trading market for our securities;
+
+ 
+
+ a limited amount of news and analyst coverage; and
+
+ 
+
+ a decreased ability to issue additional securities or obtain additional financing in the future.
+
+ 
+
+The National Securities
+Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale
+of certain securities, which are referred to as "covered securities." Because we expect that our units and eventually
+our Class A common stock and warrants will be listed on Nasdaq, our units, Class A common stock and warrants will be
+covered securities. Although the states are preempted from regulating the sale of our securities, the federal statute does allow
+the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the
+states can regulate or bar the sale of covered securities in a particular case. While we are not aware of a state having used these
+powers to prohibit or restrict the sale of securities issued by blank check companies, other than the State of Idaho, certain state
+securities regulators view blank check companies unfavorably and might use these powers, or threaten to use these powers, to hinder
+the sale of securities of blank check companies in their states. Further, if we were no longer listed on Nasdaq, our securities
+would not be covered securities and we would be subject to regulation in each state in which we offer our securities.
+
+ 
+
+We are not registering the shares of
+Class A common stock issuable upon exercise of the warrants under the Securities Act or any state securities laws at this
+time, and such registration may not be in place when an investor desires to exercise warrants, thus precluding such investor from
+being able to exercise its warrants except on a cashless basis and potentially causing such warrants to expire worthless.
+
+ 
+
+We are not registering the shares of Class A
+common stock issuable upon exercise of the warrants under the Securities Act or any state securities laws at this time. However,
+under the terms of the warrant agreement, have agreed that as soon as practicable, but in no event later than 30 business
+days after the closing of our initial business combination, we will use our reasonable best efforts to file, and within 60 business
+days following our initial business combination to have declared effective, a registration statement under the Securities Act covering
+such shares and maintain a current prospectus relating to the Class A common stock issuable upon exercise of the warrants,
+until the expiration of the warrants in accordance with the provisions of the warrant agreement. We cannot assure you that we will
+be able to do so if, for example, any facts or events arise which represent a fundamental change in the information set forth in
+the registration statement or prospectus, the financial statements contained or incorporated by reference therein are not current
+or correct or the SEC issues a stop order. If the shares issuable upon exercise of the warrants are not registered under the Securities
+Act, we will be required to permit holders to exercise their warrants on a cashless basis. However, no warrant will be exercisable
+for cash or on a cashless basis, and we will not be obligated to issue any shares to holders seeking to exercise their warrants,
+unless the issuance of the shares upon such exercise is registered or qualified under the securities laws of the state of the exercising
+holder, or an exemption from registration is available. Notwithstanding the above, if our Class A common stock is at the time
+of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a "covered
+security" under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of warrants who
+exercise their warrants to do so on a "cashless basis" in accordance with Section 3(a)(9) of the Securities
+Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, but we will
+be required to use our reasonable best efforts to register or qualify the shares under applicable blue sky laws to the extent an
+exemption is not available. In no event will we be required to net cash settle any warrant. If the issuance of the shares upon
+exercise of the warrants is not so registered or qualified or exempt from registration or qualification, the holder of such warrant
+shall not be entitled to exercise such warrant and such warrant may have no value and expire worthless. In such event, holders
+who acquired their warrants as part of a purchase of units will have paid the full unit purchase price solely for the shares of
+Class A common stock included in the units. If and when the warrants become redeemable by us, we may exercise our redemption
+right on a cashless basis even if we are unable to register or qualify the underlying shares of Class A common stock for sale
+under all applicable state securities laws. We will use our reasonable best efforts to register or qualify such shares of Class A
+common stock under the blue sky laws of the state of residence in those states in which the warrants were offered by us in this
+offering.
+
+ 
+
+ 57 
+
+ Table of Contents 
+
+ 
+
+ 
+
+We may issue additional common stock
+or preferred stock to complete our initial business combination or under an employee incentive plan after completion of our initial
+business combination. We may also issue shares of Class A common stock upon the conversion of the Class B common stock
+at a ratio greater than one-to-one at the closing of our initial business combination as a result of the anti-dilution provisions
+contained in our amended and restated certificate of incorporation. Any such issuances would dilute the interest of our shareholders
+and likely present other risks.
+
+ 
+
+Our amended and
+restated certificate of incorporation will authorize the issuance of up to 21,000,000 shares of Class A common stock, par value
+$0.0001 per share, 3,000,000 shares of Class B common stock, par value $0.0001 per share, and 1,000,000 shares of preferred
+stock, par value $0.0001 per share. Immediately after this offering, there will be 7,514,000 shares of Class A common stock and
+400,000 shares of Class B common stock (assuming, in each case, that the underwriters have not exercised their over-allotment
+option and 225,000 Class B founder shares have been forfeited as a result) issued and outstanding. As a result, there will be
+13,486,000 unissued shares of Class A common stock and 2,600,000 shares of Class B common stock, respectively, available
+for issuance, which amount does not take into account the shares of Class A common stock reserved for issuance upon exercise of
+any outstanding warrants or the shares of Class A common stock issuable upon conversion of Class B common stock.
+Immediately after the consummation of this offering, there will be no shares of preferred stock issued and outstanding. Shares of
+Class B common stock are convertible into shares of our Class A common stock initially at a one-for-one ratio but subject
+to adjustments as set forth herein, including in certain circumstances in which we issue Class A common stock or equity-linked
+securities related to our initial business combination.
+
+ 
+
+We may issue a substantial number of additional
+shares of common or preferred stock to complete our initial business combination or under an employee incentive plan after completion
+of our initial business combination (although our amended and restated certificate of incorporation will provide that we may not
+issue securities that can vote with common shareholders on matters related to our pre-initial business combination activity). We
+may also issue shares of Class A common stock upon conversion of the Class B common stock at a ratio greater than one-to-one
+at the closing of our initial business combination as a result of the anti-dilution provisions contained in our amended and restated
+certificate of incorporation. However, our amended and restated certificate of incorporation will provide, among other things,
+that prior to our initial business combination, we may not issue additional shares of capital stock that would entitle the holders
+thereof to: (i) receive funds from the trust account; (ii) vote on any initial business combination; or (iii) vote
+on matters related to our pre-initial business combination activity. These provisions of our amended and restated certificate of
+incorporation, like all provisions of our amended and restated certificate of incorporation, may be amended with the approval of
+our shareholders. However, our executive officers and directors have agreed, pursuant to a written agreement with us, that they
+will not propose any amendment to our then existing amended and restated certificate of incorporation to (A) modify the substance
+or timing of our obligation to provide for the redemption of our public shares in connection with an initial business combination
+or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing
+of this offering (or up to 18 months, if we extend the time to complete a business combination as described in this prospectus)
+or (B) with respect to any other material provision relating to shareholders rights or pre-initial business combination
+activity, unless we provide our public shareholders with the opportunity to redeem their shares of common stock upon approval of
+any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including
+interest (which interest shall be net of taxes payable), divided by the number of then outstanding public shares.
+
+ 
+
+ 58 
+
+ Table of Contents 
+
+ 
+
+ 
+
+The issuance of additional
+shares of common or preferred stock:
+
+ 
+
+ may significantly dilute the equity interest of investors in this offering;
+
+ 
+
+ may subordinate the rights of holders of common stock if preferred stock is issued with rights
+senior to those afforded our common stock;
+
+ 
+
+ could cause a change of control if a substantial number of shares of our common stock are issued,
+which may affect, among other things, our ability to use our net operating loss carry forwards, if any, and could result in the
+resignation or removal of our present officers and directors; and
+
+ 
+
+ may adversely affect prevailing market prices for our units, Class A common stock and/or warrants.
+
+ 
+
+We may issue notes or other debt securities,
+or otherwise incur substantial debt, to complete a business combination, which may adversely affect our leverage and financial
+condition and thus negatively impact the value of our shareholders investment in us.
+
+ 
+
+Although we have no
+commitments as of the date of this prospectus issue any notes or other debt securities, or to otherwise incur outstanding debt
+following this offering, we may choose to incur substantial debt to complete our business combination. We have agreed that we will
+not incur any indebtedness unless we have obtained from the lender a waiver of any right, title, interest or claim of any kind
+in or to the monies held in the trust account. As such, no issuance of debt will affect the per-share amount available for redemption
+from the trust account. Nevertheless, the incurrence of debt could have a variety of negative effects, including:
+
+ 
+
+ default and foreclosure on our assets if our operating revenues after an initial business combination
+are insufficient to repay our debt obligations;
+
+ 
+
+ acceleration of our obligations to repay the indebtedness even if we make all principal and interest
+payments when due if we breach certain covenants that require the maintenance of certain financial ratios or reserves without a
+waiver or renegotiation of that covenant;
+
+ 
+
+ our immediate payment of all principal and accrued interest, if any, if the debt security is payable
+on demand;
+
+ 
+
+ our inability to obtain necessary additional financing if the debt security contains covenants
+restricting our ability to obtain such financing while the debt security is outstanding;
+
+ 
+
+ our inability to pay dividends on our common stock;
+
+ 
+
+ using a substantial portion of our cash flow to pay principal and interest on our debt, which will
+reduce the funds available for dividends on our common stock if declared, our ability to pay expenses, make capital expenditures
+and acquisitions, and fund other general corporate purposes;
+
+ 
+
+ limitations on our flexibility in planning for and reacting to changes in our business and in the
+industry in which we operate;
+
+ 
+
+ 59 
+
+ Table of Contents 
+
+ 
+
+ 
+
+ increased vulnerability to adverse changes in general economic, industry and competitive conditions
+and adverse changes in government regulation;
+
+ 
+
+ limitations on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions,
+debt service requirements, and execution of our strategy; and
+
+ 
+
+ other disadvantages compared to our competitors who have less debt.
+
+ 
+
+The grant of registration rights to
+our founders may make it more difficult to complete our initial business combination, and the future exercise of such rights may
+adversely affect the market price of our Class A common stock.
+
+ 
+
+Pursuant to an agreement
+to be entered into concurrently with the issuance and sale of the securities in this offering, our initial shareholders and their
+permitted transferees can demand that we register their founder shares and private units (including underlying securities), after
+those shares convert to our Class A common stock at the closing of our initial business combination. In addition, holders
+of our private units and their permitted transferees can demand that we register the private units (including underlying securities),
+and holders of working capital units if any may demand that we register such working capital units (including underlying securities).
+We will bear the cost of registering these securities. The registration and availability of such a significant number of securities
+for trading in the public market may have an adverse effect on the market price of our Class A common stock. In addition,
+the existence of the registration rights may make our initial business combination more costly or difficult to conclude. This is
+because the shareholders of the target business may increase the equity stake they seek in the combined entity or ask for more
+cash consideration to offset the negative impact on the market price of our Class A common stock that is expected when the
+common stock and private units owned by our founders or holders of our working capital loans (including extension notes) or their
+respective permitted transferees are registered.
+
+ 
+
+The exercise price for the warrants
+is higher than in some similar blank check company offerings in the past, and, accordingly, the warrants are more likely to expire
+worthless.
+
+ 
+
+The exercise price of
+the warrants is higher than some similar blank check companies in the past. Historically, the exercise price of a warrant was generally
+a fraction of the purchase price of the units in the initial public offering. The exercise price for our warrants is $11.50 per
+share. As a result, the warrants are less likely to ever be in the money and more likely to expire worthless.
+
+ 
+
+In order to complete our initial business
+combination, we may seek to amend our then existing amended and restated certificate of incorporation or other governing instruments,
+including our warrant agreement, in a manner that will make it easier for us to complete our initial business combination but that
+our shareholders or warrant holders may not support.
+
+ 
+
+In order to complete
+a business combination, blank check companies have, in the recent past, amended various provisions of their charters and governing
+instruments, including their warrant agreement. For example, blank check companies have amended the definition of business combination,
+increased redemption thresholds, changed industry focus and, with respect to their warrants, amended their warrant agreements to
+require the warrants to be exchanged for cash and/or other securities. We cannot assure you that we will not seek to amend our
+charter or other governing instruments or change our industry focus in order to complete our initial business combination.
+
+ 
+
+Our founders contributed an aggregate
+of approximately $25,000, or approximately $0.01 per founder share, and, accordingly, you will experience immediate and substantial
+dilution from the purchase of our Class A common stock.
+
+ 
+
+The
+difference between the public offering price per share (allocating all of the unit purchase price to the Class A common stock
+and none to the warrant included in the unit) and the pro forma net tangible book value per share of our Class A common stock
+after this offering constitutes the dilution to you and the other investors in this offering. Our founders acquired the founder
+shares at a nominal price, significantly contributing to this dilution. Upon the closing of this offering, and assuming no value
+is ascribed to the warrants included in the units, you and the other public shareholders will incur an immediate and substantial
+dilution of approximately 107.4% (or $10.74 per share , assuming
+no exercise of the underwriters over-allotment option), the difference between the pro forma net tangible book value per
+share of $(0.74) and the initial offering price of $10.00 per unit. In addition, because of the anti-dilution rights of the founder
+shares, any equity or equity-linked securities issued in connection with our initial business combination would be disproportionately
+dilutive to our Class A common stock.
+
+ 
+
+ 60 
+
+ Table of Contents 
+
+ 
+
+ 
+
+Our founders paid an aggregate of $25,000
+for the founder shares, or approximately $0.01 per founder share. As a result of this low initial price, our founders stand to
+make a substantial profit even if an initial business combination subsequently declines in value or is unprofitable for our public
+shareholders.
+
+ 
+
+As a result of the low
+acquisition cost of our founder shares, our founders could make a substantial profit even if we select and consummate an initial
+business combination with an acquisition target that subsequently declines in value or is unprofitable for our public shareholders.
+Thus, such parties may have more of an economic incentive for us to enter into an initial business combination with a riskier,
+weaker-performing or financially unstable business, or an entity lacking an established record of revenues or earnings, than would
+be the case if such parties had paid the full offering price for their founder shares.
+
+ 
+
+We may amend the terms of the warrants
+in a manner that may be adverse to holders of warrants with the approval by the holders of at least 50% of the then outstanding
+warrants. As a result, the exercise price of your warrants could be increased, the exercise period could be shortened and the number
+of shares of our Class A common stock purchasable upon exercise of a warrant could be decreased, all without your approval.
+
+ 
+
+Our warrants will be
+issued in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. The warrant agreement provides that
+the terms of the warrants may be amended without the consent of any holder to cure any ambiguity or correct any defective provision,
+but requires the approval by the holders of at least 50% of the then outstanding warrants to make any change that adversely affects
+the interests of the registered holders of warrants. Accordingly, we may amend the terms of the warrants in a manner adverse to
+a holder if holders of at least 50% of the then outstanding warrants approve of such amendment. Although our ability to amend the
+terms of the warrants with the consent of at least 50% of the then outstanding warrants is unlimited, examples of such amendments
+could be amendments to, among other things, increase the exercise price of the warrants, convert the warrants into cash, shorten
+the exercise period or decrease the number of shares of our Class A common stock purchasable upon exercise of a warrant.
+
+ 
+
+Our warrant agreement will designate
+the courts of the State of New York or the United States District Court for the Southern District of New York as
+the sole and exclusive forum for certain types of actions and proceedings that may be initiated by holders of our warrants, which
+could limit the ability of warrant holders to obtain a favorable judicial forum for disputes with our company.
+
+ 
+
+Our warrant agreement
+will provide that, subject to applicable law, (i) any action, proceeding or claim against us arising out of or relating in
+any way to the warrant agreement will be brought and enforced in the courts of the State of New York or the United States
+District Court for the Southern District of New York, and (ii) that we irrevocably submit to such jurisdiction, which
+jurisdiction shall be the exclusive forum for any such action, proceeding or claim. We will waive any objection to such exclusive
+jurisdiction and that such courts represent an inconvenient forum.
+
+ 
+
+These provisions of
+the warrant agreement will apply to action, proceeding or claim brought to enforce any liability or duty arising under the Securities
+Act. Notwithstanding the foregoing, these provisions of the warrant agreement will not apply to suits brought to enforce any liability
+or duty created by the Exchange Act or any other claim for which the federal district courts of the United States of
+America are the sole and exclusive forum. Any person or entity purchasing or otherwise acquiring any interest in any of our warrants
+shall be deemed to have notice of and to have consented to the forum provisions in our warrant agreement. If any action, the subject
+matter of which is within the scope the forum provisions of the warrant agreement, is filed in a court other than a court of the
+State of New York or the United States District Court for the Southern District of New York (a "foreign action")
+in the name of any holder of our warrants, such holder shall be deemed to have consented to: (x) the personal jurisdiction
+of the state and federal courts located in the State of New York in connection with any action brought in any such court to
+enforce the forum provisions (an "enforcement action"), and (y) having service of process made upon such warrant
+holder in any such enforcement action by service upon such warrant holder s counsel in the foreign action as agent for such
+warrant holder.
+
+ 
+
+ 61 
+
+ Table of Contents 
+
+ 
+
+ 
+
+This choice-of-forum
+provision may limit a warrant holder s ability to bring a claim in a judicial forum that it finds favorable for disputes
+with our company, which may discourage such lawsuits. Alternatively, if a court were to find this provision of our warrant agreement
+inapplicable or unenforceable with respect to one or more of the specified types of actions or proceedings, we may incur additional
+costs associated with resolving such matters in other jurisdictions, which could materially and adversely affect our business,
+financial condition and results of operations and result in a diversion of the time and resources of our management and board of
+directors.
+
+ 
+
+A provision of our warrant agreement
+may make it more difficult for us to consummate an initial business combination.
+
+ 
+
+If (x) we issue additional
+shares of Class A common stock or equity-linked securities at a Newly Issued Price of less than $9.20 per share of Class A common
+stock (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case
+of any such issuance to our founders or their affiliates, without taking into account any founder shares held by our founders or
+such affiliates, as applicable, prior to such issuance), (y) the aggregate gross proceeds from such issuances represent more than
+60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date
+of the consummation of our initial business combination (net of redemptions), and (z) the Market Value is below $9.20 per share,
+then the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the greater of the Market
+Value and the Newly Issued Price, and the $16.50 per share redemption trigger price described above will be adjusted (to the nearest
+cent) to be equal to 180% of the greater of the Market Value and the Newly Issued Price.
+
+ 
+
+We may redeem your unexpired warrants
+prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.
+
+ 
+
+We have the ability
+to redeem outstanding warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per
+warrant, provided that the last reported sales price of our Class A common stock equals or exceeds $16.50 per share (as adjusted
+for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30 trading-day
+period ending on the third trading day prior to the date on which we give proper notice of such redemption and provided certain
+other conditions are met. If and when the warrants become redeemable by us, we may exercise our redemption right on a cashless
+basis even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws.
+Redemption of the outstanding warrants could force you (i) to exercise your warrants and pay the exercise price therefor at
+a time when it may be disadvantageous for you to do so, (ii) to sell your warrants at the then-current market price when you
+might otherwise wish to hold your warrants or (iii) to accept the nominal redemption price which, at the time the outstanding
+warrants are called for redemption, is likely to be substantially less than the market value of your warrants.
+
+ 
+
+Our private units and founder shares
+may have an adverse effect on the market price of our Class A common stock and make it more difficult to complete our business
+combination.
+
+ 
+
+Simultaneously with the closing
+of this offering, we will be issuing 414,000 private units (or up to 450,000 private units if the underwriters over-allotment option
+is exercised in full) to our sponsor. Our founders currently own 1,725,000 founder shares (up to 225,000 Class B founder shares are subject
+to forfeiture if the over-allotment option is exercised in full or in part). The Class B founder shares are automatically convertible
+into shares of Class A common stock at the closing of our initial business combination on a one-for-one basis, subject to adjustments
+as set forth herein. In addition, if our founders or their affiliates make any working capital loans (including extension notes), up to
+$3,000,000 of such loans may be converted into working capital units, at the price of $10.00 per unit at the option of the lender. Such
+working capital units would be identical to the private units sold in the private placement.
+
+ 
+
+To the extent we issue
+shares of Class A common stock to complete a business combination, the potential for the issuance of a substantial number
+of additional shares of Class A common stock upon conversion rights of up to $3,000,000 working capital loans (including extension
+notes) could make us a less attractive acquisition vehicle to a target business. Any such issuance will increase the number of
+issued and outstanding shares of our Class A common stock and reduce the value of the shares of Class A common stock
+issued to complete the business combination. Therefore, our private units and founder shares may make it more difficult to complete
+a business combination or increase the cost of acquiring the target business.
+
+ 
+
+ 62 
+
+ Table of Contents 
+
+ 
+
+ 
+
+The determination of the offering price
+of our units and the size of this offering is more arbitrary than the pricing of securities and size of an offering of an operating
+company in a particular industry. You may have less assurance, therefore, that the offering price of our units properly reflects
+the value of such units than you would have in a typical offering of an operating company.
+
+ 
+
+Prior to this offering
+there has been no public market for any of our securities. The public offering price of the units and the terms of the warrants
+were negotiated between us and the underwriters. In determining the size of this offering, management held customary organizational
+meetings with the underwriters with respect to the state of capital markets, generally, and the amount the underwriters believed
+they reasonably could raise on our behalf. Factors considered in determining the size of this offering, prices and terms of the
+units, including the Class A common stock and warrants underlying the units, include:
+
+ 
+
+ the history and prospects of companies whose principal business is the acquisition of other companies;
+
+ 
+
+ prior offerings of those companies;
+
+ 
+
+ our prospects for acquiring an operating business;
+
+ 
+
+ a review of debt to equity ratios in leveraged transactions;
+
+ 
+
+ our capital structure;
+
+ 
+
+ an assessment of our management and their experience in identifying operating companies;
+
+ 
+
+ general conditions of the securities markets at the time of this offering; and
+
+ 
+
+ other factors as were deemed relevant.
+
+ 
+
+Although these factors
+were considered, the determination of our offering price is more arbitrary than the pricing of securities of an operating company
+in a particular industry since we have no historical operations or financial results.
+
+ 
+
+There is currently no market for our
+securities and a market for our securities may not develop, which would adversely affect the liquidity and price of our securities.
+
+ 
+
+There is currently no
+market for our securities. Shareholders therefore have no access to information about prior market history on which to base their
+investment decision. Following this offering, the price of our securities may vary significantly due to one or more potential business
+combinations and general market or economic conditions. Furthermore, an active trading market for our securities may never develop
+or, if developed, it may not be sustained. You may be unable to sell your securities unless a market can be established and sustained.
+
+ 
+
+Because we must furnish our shareholders
+with target business financial statements, we may lose the ability to complete an otherwise advantageous initial business combination
+with some prospective target businesses.
+
+ 
+
+The federal proxy rules require
+that a proxy statement with respect to a vote on a business combination meeting certain financial significance tests include target
+historical and/or pro forma financial statement disclosure. We will include the same financial statement disclosure in connection
+with our tender offer documents, whether or not they are required under the tender offer rules. These financial statements may
+be required to be prepared in accordance with, or be reconciled to, accounting principles generally accepted in the United States
+of America, or GAAP, or international financial reporting standards as issued by the International Accounting Standards Board,
+or IFRS, depending on the circumstances and the historical financial statements may be required to be audited in accordance with
+the standards of the Public Company Accounting Oversight Board (United States), or PCAOB. These financial statement requirements
+may limit the pool of potential target businesses we may acquire because some targets may be unable to provide such financial statements
+in time for us to disclose such financial statements in accordance with federal proxy rules and complete our initial business
+combination within the prescribed time frame.
+
+ 
+
+ 63 
+
+ Table of Contents 
+
+ 
+
+ 
+
+An investment in this offering may involve
+uncertain or adverse U.S. federal income tax consequences.
+
+ 
+
+An investment in this
+offering may involve uncertain or adverse U.S. federal income tax consequences. For instance:
+
+ 
+
+ because there are no authorities that directly address instruments similar to the units we are
+issuing in this offering, the allocation an investor makes with respect to the purchase price of the unit between the share of
+common stock and one-half of one warrant included in the units could be challenged by the Internal Revenue Service of the United
+States ("IRS") or the courts.
+
+ 
+
+ if we make distributions on our common stock, such distributions generally will be treated as dividends
+for U.S. federal income tax purposes to the extent of our current or accumulated earnings and profits. The ability of a holder
+to seek redemption of their shares may be viewed as a position with respect to substantially similar or related property which
+diminishes your risk of loss and thereby affects your ability to satisfy the holding period requirements for the dividends received
+deduction or the preferential tax rate on qualified dividend income with respect to the time period prior to the approval of an
+initial business combination.
+
+ 
+
+ our warrants may be exercised on a cashless basis in certain situations as described herein. Although
+there is no direct legal authority as to the U.S. federal income tax treatment of an exercise of a warrant on a cashless basis,
+we intend to take the position that such exercise will not be taxable, either because the exercise is not a gain realization event
+or because it qualifies as a tax-free recapitalization. In the former case, the holding period of the common stock should commence
+on the day after the warrant is exercised. In the latter case, the holding period of the common stock would include the holding
+period of the exercised warrants. However, our position is not binding on the IRS and the IRS may treat a cashless exercise of
+a warrant as a taxable exchange.
+
+ 
+
+ any capital gain or loss you realize on a sale or other disposition of our common stock will generally
+be long-term capital gain or loss if your holding period for the common stock is more than one year. However, the redemption feature
+of the common stock could affect your ability to satisfy the holding period requirements for the long-term capital gain tax rate
+with respect to the time period prior to the approval of an initial business combination.
+
+ 
+
+See the section of this
+prospectus entitled "United States Federal Income Tax Considerations — Personal Holding Company Status"
+for a
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001931691_mobiv_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001931691_mobiv_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..c9770406a35eb8aaccf31c99c76b7be5e4928c12
--- /dev/null
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@@ -0,0 +1 @@
+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Our Company We are a newly organized blank check company incorporated on January 7, 2022, as a Delaware corporation for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. We have not selected any potential business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any potential business combination target. While efforts to identify a target business may span many industries and geographies, our focus will be predominantly to acquire a niche electric vehicle ( EV ) company that contributes to solving the mobility and space challenges of modern cities in a sustainable manner without compromising the comfort and safety of its passengers. We believe that global urbanization creates one of the biggest challenges over the near future. While identifying the right target, we want to realize our vision to provide impactful and game-changing solutions to those challenges and contribute actively for the betterment of tomorrow s world. Our target acquisition strategy will be focused on companies with a proven product and clear go-to-market strategy, among other criteria. We expect to distinguish ourselves by leveraging on a broad spectrum of internal and external network of relationships within the automotive, financial and energy-related sectors, which we believe will help us to identify opportunities effectively and efficiently. While we may pursue a business combination target in any business, industry or geographic region, we intend to focus our search on businesses in the EV industry with a focus throughout Asia, Israel and Europe, however, we expressly disclaim any intent to and will not consummate a business combination with a target business located in China, Hong Kong, Macau, Taiwan, Russia or Iran. We intend to identify and acquire a business that could benefit from a hands-on owner with extensive operational experience and presents an attractive risk-adjusted return profile under our stewardship. Fundamentally sound companies can often under-perform their potential due to underinvestment, over-leveraged capital structures, excessive cost structures, incomplete management teams and/or inappropriate business strategies. In the case of this initial public offering, our management team has extensive experience in identifying and executing acquisitions, initial public offerings, raising funds and growing businesses across myriad asset sectors and has significant hands-on experience working with companies to prepare for and execute a successful offering. Moreover, our management team serving as active owners and directors, is committed to work closely with these companies to continue their transformations and to create value in the public markets, including within the automotive sector. We will seek to capitalize on the significant experience of our management team in consummating an initial business combination with the ultimate goal of pursuing attractive returns for our stockholders. We believe that our management team is well-positioned to identify attractive risk-adjusted returns in the marketplace and that their contacts and transaction sources, ranging from industry executives, private owners, private equity funds, and investment bankers, in addition to extensive global industry contacts, will enable us to pursue a broad range of opportunities. Our management believes that its ability to identify and implement value creation initiatives will remain central to its differentiated acquisition strategy. Our management team may seek to combine with businesses owned by founders and minority investors, although we may consummate a transaction with businesses controlled by private equity investors or family- Table of Contents public shares at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions as further described herein. Public stockholders will not be offered the opportunity to vote on or redeem their shares in connection with any such extension. Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 491,100 placement units (or 543,300 placement units if the over-allotment option is exercised in full) at a price of $10.00 per unit, for an aggregate purchase price of $4,911,000 ($5,433,000 if the over-allotment option is exercised in full). Each placement unit will be identical to the units sold in this offering, except as described in this prospectus. The placement units will be sold in a private placement that will close simultaneously with the closing of this offering. Our sponsor and initial stockholders own an aggregate of 2,501,250 Class B founder shares (up to 326,250 shares of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised), which will automatically convert into shares of Class A common stock at the time of our initial business combination, on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described herein. Prior to this offering, there has been no public market for our units, Class A common stock or warrants. We intend to apply to have our units approved for listing on The Nasdaq Stock Market LLC ( Nasdaq ) under the symbol MOBVU on or promptly after the date of this prospectus. We expect the Class A common stock and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus (or if such date is not a business day, the following business day) unless EF Hutton, division of Benchmark Investments, LLC, informs us of its decision to allow earlier separate trading, subject to our filing a Current Report on Form 8-K with the Securities and Exchange Commission containing an audited balance sheet reflecting our receipt of the gross proceeds of this offering and issuing a press release announcing when such separate trading will begin. Once the securities comprising the units begin separate trading, we expect that the Class A common stock and warrants will be listed on Nasdaq under the symbols MOBV and MOBVW, respectively. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 48 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 87,000,000 Underwriting discounts and commissions(1) $ 0.500 $ 4,350,000 Proceeds, before expenses, to Mobiv Acquisition Corp $ 9.500 $ 82,650,000 (1) Includes $0.35 per unit, or $3,045,000 (or $3,501,750 if the over-allotment option is exercised in full) in the aggregate, payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein. The deferred commissions will be released to the representative of the underwriters only on completion of an initial business combination, as described in this prospectus, which does not include certain fees and expenses payable to the underwriters in connection with this offering. In addition, designees of the representative of the underwriters will receive an aggregate of 87,000 Class A common stock (or up to 100,050 Class A common stock if the over-allotment option is exercised in full), which we refer to herein as the representative shares as compensation in connection Table of Contents owned businesses, which means that there is a wide universe of potential partners. We believe our understanding of private deal execution and public capital markets, and valuation dynamics in both markets, make us uniquely positioned to identify and execute a business combination with a growth orientation. Market Opportunity: Transportation Innovation to Address Climate Change, Congestion, Aging Infrastructure and More Our management team believes that urban mobility is going to change rapidly in the coming years as EVs proliferate, ride sharing continues to grow, and eventually autonomous vehicles (AV) enter urban fleets. This is especially true in cities where new forms of mobility are concentrated and investment in supporting infrastructure is needed to accommodate this growth. These changes, we believe, will coincide with the evolution towards cleaner, more decentralized and digitalized energy systems and services, and increasing adoption of electrification in the transportation sector. According to the United Nations, approximately 55% of the world lives in urban areas as of 2018. This number is expected to grow to approximately 68% by 2050, adding roughly 2.5 billion people to urban areas around the world,2 with an estimated 3.0 million people moving to cities every week.3 While the COVID-19 pandemic may impact these projections, we believe that cities will remain vital centers of commerce for the population, with this tremendous growth providing commercial opportunities to mitigate urban mobility challenges including pollution, congestion and parking, among others. Studies have shown that, at present, cities consume approximately 78% of the world s energy and produce between 60 to 75% of the world s greenhouse gas emissions.4 Not surprisingly, the major contributor is transportation with passenger vehicles accounting for approximately 70% of emissions and 50% of urban air pollution.5 According to the European Commission, over 70% of citizens in the European Union live in cities which generate 23% of all transport greenhouse gas emissions.6 On the current trajectory, greenhouse gas emissions from transportation are on track to double by 2050. Investment into climate technology is continuing to show strong growth as an emerging asset class, with a total of approximately $87.5 billion invested over second half of 2020 and first half of 2021, which represented a 210% increase from the total amount invested in the twelve months prior.7 These emissions have not only been linked to climate change, but also to causing local health effects like asthma and cancer. This means that it is not just people behind the wheel who are dealing with the consequences of traffic, but also those living around highways or highly congested roadways.8 Congestion remains an issue in the modern world today, as many of the world s cities were simply not designed to handle the present volume of vehicular traffic. Congestion results in loss of time and money. A study carried out by analysts INRIX Global Traffic Scorecard discovered the average commuter in the United Kingdom spent approximately 115 hours stuck in traffic during 2019, costing them some 894 in lost productivity and other expenses, such as wear and tear.9 In 2019, drivers in the United States lost approximately a total of $88.0 billion or an average of 99 hours and $1,377 per year per commuter, according to the INRIX Global Traffic Scorecard.10 2 https://worldpopulationreview.com/country-rankings/most-urbanized-countries 3 See International Organization for Migration (IOM) 2015 World Migration Report and Visa, The Future of Transportation Mobility in the Age of the Megacity, page 5 4 See United Nations Environment Programme, Cities and climate change December 2019. https://sdgs.un.org/sites/default/files/2021-05/International%20Conference%20on%20Climate%20and%20Cities.pdf 5 See Id. 6 https://ec.europa.eu/commission/presscorner/detail/en/qanda_21_6729 7 https://www.pwc.com/gx/en/services/sustainability/publications/state-of-climate-tech.html 8 https://climate-xchange.org/2019/05/29/investigating-the-impact-of-congestion-pricing-around-the-world/ 9 https://www.thefuelcardpeople.co.uk/drivers-spent-115-hours-stuck-in-traffic-in-2019-study-reveals/ 10 https://inrix.com/press-releases/2019-traffic-scorecard-us Table of Contents with this offering. See the section of this prospectus entitled Underwriting beginning on page 189 for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the placement units described in this prospectus, $3,045,000 or $3,501,750 if the underwriters over-allotment option is exercised in full ($10.25 per unit in either case), will be deposited into a segregated trust account located in the United States with Continental Stock Transfer & Trust Company acting as trustee. The underwriters are offering the units subject to their acceptance of the units from us and subject to prior sale. The underwriters reserve the right to withdraw, cancel or modify offers to the public and to reject orders in whole or in part. In addition, the underwriters have advised us that they do not intend to confirm sales to any account over which they exercise discretionary authority. The underwriters expect to deliver the units to the purchasers on or about ________, 2022. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. EF Hutton division of Benchmark Investments, LLC The date of this prospectus is ________, 2022 Table of Contents Commuting in congested cities quickly, safely, comfortably and cleanly is a global challenge that is growing and felt by millions in major cities across the world .11 According to the World Bank, by 2045, the world s urban population will increase by approximately 1.5 times to 6.0 billion.12 Thus, city leaders must move quickly to plan for growth and provide the basic services, infrastructure, and improvements to mobility to accommodate their expanding populations need. Already, cities devote a large amount of space and resources to provide parking, primarily used by private cars that are idle approximately 95% of the time13, with bicycles, motorcycles, ride-sharing and vehicle-free initiatives still facing significant roadblocks to mass adoption and consistent usage. We believe mobility solutions of the future will need to be compact and mobile to navigate congested traffic swiftly and alleviate urban driving pains such as parking, unpredictability and time wasted in traffic. Newly vacated parking spaces would have tremendous economic value and could provide other forms of transport or civic uses. The European Commission released a new Urban Mobility Framework in December 2021 that delivers on the Sustainable and Smart Mobility Strategy Action Plan it released in December 2020. The new Urban Mobility Framework addresses certain of the mobility challenges stemming from intense economic activities such as congestion, emissions and noise, with key elements action points to make urban transport environmentally-friendly and energy-efficient and identifying zero-emission solutions for urban logistics.14 The new Urban Mobility Framework contains proposals focused on prioritizing zero-emission solutions for urban fleets, including taxis and ride-hailing services, the last-mile of urban deliveries, and the construction and modernization of multimodal hubs. In that spirit, we intend to focus on identifying and completing our initial business combination with a company that is well-positioned strategically to capitalize on the favorable long-term growth trends in the EV and urban mobility technologies space. High traffic volumes are also responsible for large amounts of air pollution, a situation made worse by congestion with vehicle engines idling whilst emitting noxious fumes over longer periods of time. With the recent launch of the new European Urban Mobility Framework targeting to improve transport and mobility in and around cities as well as the efficiency of goods and home deliveries, we are on the lookout for innovative solutions with a smaller-than-small footprint, designed to help people and communities navigate their space-limited urban cities. We believe that aging infrastructures compound the challenges faced within urban areas. Thus, as metropolitan populations grow, we believe that it is critical for cities to improve the efficiency and efficacy of their infrastructures. More than ever, solutions are needed to address congestion and aging infrastructure issues, particularly in light of the COVID-19 pandemic, which has significantly reduced the use of public transportation and severely impacted the financial position of transport operators around the world.15 Planning for urban growth and transformation that could minimize energy consumption for transportation will be key for countries around the world to achieve their respective climate goals. Achieving Transformation in Transportation through Urban Mobility Solutions Urban transportation was in transition before the commencement of the COVID-19 pandemic, as we saw progress toward electrification, connected transportation, shared mobility and the beginning phases of autonomous vehicles.16 The global electric car market share has taken a tremendous leap forward in the past decade, and we expect the trend to accelerate exponentially in the years ahead. Global electric car sales took a 11 https://www.weforum.org/agenda/2020/11/global-continent-urban-population-urbanisation-percent/ 12 https://www.worldbank.org/en/topic/urbandevelopment/overview 13 https://www.nature.com/articles/s41598-020-71867-1#Abs1 14 https://transport.ec.europa.eu/news/efficient-and-green-mobility-2021-12-14_en 15 See https://time.com/5869375/public-transit-coronavirus-covid/. 16 https://www.carteeh.org/wp-content/uploads/2020/05/Impact-of-COVID-19-on-Transportation.pdf. Table of Contents massive leap in both volume and market share in 2021, according to a new report from the International Energy Agency (the IEA ).17 In the world of clean energy, few areas are as dynamic as the electric car market according to the IEA s January 30, 2022 Report. In total, approximately 130,000 electric cars were sold worldwide in 2012; fast forward to 2022, the volume amount is being sold in the space of a single week. International Energy Agency Electric Car Sales (2010 2020) Automakers sold 6.6 million plug-in electric cars in 2021, more than double the 3.0 million sold in 2020, and more than triple the 2.2 million sold in 2019, according to the IEA. The broader definition of electric cars, which includes both battery electric and plug-in hybrids, claimed approximately 9% of the global new-car market, up from approximately 4% in 2020 and 2% in 2019, according to the IEA 2022 Report. After a decade of rapid growth, the global electric car stock hit the 10.0 million mark in 2020, a 43% increase from 2019, and represents a 1% stock share in the automotive industry, with battery electric cars accounted for two-thirds of new electric car registrations and two-thirds of the stock in 2020.18 In 2020, Europe had the largest annual increase to reach 3.2 million new electric car registrations. About three million new electric cars were registered in 2020. For the first time, Europe led with approximately 1.4 million new registrations. China followed with 1.2 million registrations, while the United States registered approximately 295,000 new electric cars (as seen in this IEA chart above). While 26 of 27 European Union member nations have some form of EV incentive program in place, some of the wealthier countries, such as France and Germany, have made electric cars a centerpiece of stimulus programs aimed at reducing the economic impact of the COVID-19 pandemic.19 17 https://www.iea.org/commentaries/electric-cars-fend-off-supply-challenges-to-more-than-double-global-sales?utm_source=SendGrid&utm_medium=Email&utm_campaign=IEA+newsletters. 18 https://www.iea.org/reports/global-ev-outlook-2021?mode=overview. 19 https://www.greencarreports.com/news/1129375_europe-is-moving-at-two-speeds-on-ev-adoption Table of Contents Across the globe, regulators and industry players alike are recognizing the opportunity that the transition towards EVs presents for their economies, from meeting climate change commitments and increasing energy security, to many opportunities along the value chain for economies to rethink urban mobility challenges and building sustainable transportation ecosystems.20 According to Deloitte, the global EV market is forecasted to grow at a compound-annual-growth-rate (CAGR) of approximately 29% between 2020 and 2030,21 driven by supportive government policies and regulations, increasing investments by leading automotive original equipment manufacturers ( OEM ), rising environmental concerns and advancement in charging systems technologies. Consumer and business mobility behavior is changing, with an increase in municipality-led actions expected to tackle urban mobility challenges. Underserved mobility markets are currently anticipated to be some of the fastest growing industries in the global economy, with the global Last Mile Delivery market size is forecasted to grow at a CAGR of approximately 10%, from $43.0 billion in 2022 to $76.0 billion in 2028.22 Meanwhile, according to Statista, revenue in the ride-hailing and taxi segment is projected to reach $386.0 billion by 2026, representing a CAGR of 5% from 2022.23 McKinsey & Company estimates the size of the micro-mobility market to be between $300.0 billion to $500.0 billion, with United States and Europe taking up to 90% of the market size.24 Moving forward, we believe the key to planning for urban growth, congestion and transformation is investment in transportation innovation and incorporating lessons learned from the COVID-19 pandemic. We believe that transportation innovation to move people and goods quickly, safely and effectively, every day, will require additional improvements to the public and private transportation systems beyond EVs. Cities around the globe are eager for this innovation, as seen at the annual EIT Urban Mobility Innovation Programme, most recently in spring 2022 where representatives from more than 35 cities across 15 countries gathered to brainstorm ground-breaking urban mobility solutions.25 The key themes included accelerating market opportunities, encouraging clean and green mobility solutions, and deploying safe and inclusive mobility strategies to achieve climate-neutral and smart cities.26 What is clear is that the urban transport sector has a clear role to play in our planet s green recovery, from a wider roll-out of EVs and cutting the number of cars in city centers, to enabling multi-modal journeys and boosting micro-mobility in urban environments. While cities are at the forefront of the current challenge and efforts made towards achieving global sustainability through urban planning and transportation innovation, very few cities can afford to create custom transportation solutions that are able to meet all the desired attributes, which means private investments in private innovations will continue to be a significant part of this transformation process. Our Management Team Our management team s extensive experience includes debt restructuring, corporate reorganizations, private placements and initial public offerings, as well as investments, asset management and incubation of businesses. Our management team is led by Peter Bilitsch, who brings more than 20 years of leadership experience across numerous engagements with a focus in finance, capital markets, investment management, and business growth working with a range of businesses from start-ups to established enterprises. Mr. Bilitsch has been involved in equity capital market transactions across Europe, Singapore, Thailand, Malaysia, and Philippines in various industries including healthcare, consumer goods, real estate investment trusts (REITs), energy including renewables and solar, consumer goods, microfinance, semiconductors, transport, and retail. Supporting 20 https://www.sciencedirect.com/science/article/pii/S2352146521009029?ref=pdf_download&fr=RR-2&rr=70f145152d615788 21 https://www2.deloitte.com/us/en/insights/focus/future-of-mobility/electric-vehicle-trends-2030.html 22 https://reports.valuates.com/market-reports/QYRE-Auto-22T543/global-last-mile-delivery 23 https://www.statista.com/outlook/mmo/shared-mobility/shared-rides/ride-hailing-taxi/worldwide 24 https://www.mckinsey.com/industries/automotive-and-assembly/our-insights/micromobilitys-15000-mile-checkup 25 https://www.eiturbanmobility.eu/more-than-35-cities-from-15-different-countries-are-collaborating-in-innovation-projects-supported-by-the-eit-urban-mobility-in-2022/ 26 See Id./ Table of Contents Mr. Bilitsch is Mr. Weng Kiat (Adron) Leow, our Chief Financial Officer, who brings in experience as Chief Financial Officer and more than 25 years of experience in finance. Our management team will be supported by Mobiv Acquisition Corp s independent directors, its sponsor, accountants, and legal counsel, as further described below. We believe our management team is well-positioned to identify and evaluate businesses within the electronic vehicle industry that would benefit from being a public company and from access to our expertise. Moreover, according to McKinsey & Company, SPACs that are led or co-led by executives with past C-Suite experience, rather than solely by investors, tend to outperform through the deal cycle. After at least 12 months of publicly available trading data, operator-led SPACs have shown to trade at a 40% premium compared to other SPACs and about 10% higher than their industry peers (by about 10%).27 Peter Bilitsch, Chief Executive Officer and Director Mr. Bilitsch, our Chief Executive Officer and a member of our board of directors, brings more than 20 years of work experience across initial public offerings ( IPOs ), capital markets, regulatory matters, and investment and trading, to the company. Most recently Peter Bilitsch was for more than 11 years a Director in Regional Equity Capital Markets at CIMB Investment Bank ( CIMB ), a leading Southeast Asian bank. In that role, Mr. Bilitsch originated and executed more than 25 initial public offerings and equity deals across a wide range of industries and stock exchanges. Key transactions that Mr. Bilitsch executed among others in Southeast Asia included Farm Fresh s $254 million IPO on Bursa Malaysia in 2022 with a record breaking 30 cornerstone investors for Southeast Asia; the first Solar REIT IPO in Southeast Asia, Citicore Energy s $125 million offering on the Philippine Stock Exchange in 2022; the $1 billion IPO of leading Thai microfinance provider Ngern Tid Lor on the Stock Exchange of Thailand in 2021; the multi-category retail IPO of Central Retail Corporation for $2.3 billion on the Stock Exchange of Thailand in 2021; and IHH Healthcare s $2 billion IPO in 2012, the first ever concurrent dual listing on Bursa Malaysia and the Singapore Exchange. Prior to his work at CIMB, Mr. Bilitsch worked from 2009 to 2011 in a senior position at the Water Industry Commission for Scotland (WICS), the financial regulator for the Scottish water industry. Before WICS, Mr. Bilitsch was a Senior Trader from 2006 to 2007 at Ferox Capital Management, which managed more than $1 billion in funds. From 2003 to 2005, he worked as a Trading Associate in event driven and merger arbitrage equity trading with Citadel Investment Group, which managed more than $10 billion in funds. At Citadel and Ferox Mr. Bilitsch was also responsible for assessing investments in IPOs and follow-on offerings in Europe and Asia. From 2001 to 2003, Mr Bilitsch was a Trading Associate with El Paso Europe Limited, where he set up risk management systems and traded energy options as a volatility trader. Mr. Bilitsch started his career as an Investment Banking Analyst in Equity Capital Markets at Goldman Sachs from 2000 to 2001, where he worked on IPOs and executed the follow-on equity offerings of Syngenta, Ryanair and Infineon. Mr. Bilitsch graduated from the University of Oxford, United Kingdom with the Degree of Bachelor of Arts with Honors in Philosophy, Politics and Economics in 2000 and the Degree of Master of Arts in 2005; and from London Business School with the Degree of Master of Science in Finance in 2008. He was also licensed under the Capital Markets and Service Representative Program by the Securities Commission of Malaysia, and registered with the Financial Services Authority in the United Kingdom. We believe Mr. Bilitsch is highly qualified to serve on our board of directors with his in-depth knowledge of financial analysis, M&A situations, and equity markets. This includes experience in restructuring, strategizing company growth, reviewing financial accounts, and valuing companies. 27 https://www.mckinsey.com/industries/private-equity-and-principal-investors/our-insights/earning-the-premium-a-recipe-for-long-term-spac-success Table of Contents Weng Kiat (Adron) Leow, Chief Financial Officer and Director Mr. Leow is our Chief Financial Officer and a member of our board of directors who brings more than 25 years of complex finance and business experience to the company. Since July 2017, Mr. Leow has served as the Managing Director at ALLF Management Group Sdn. Bhd. where he is responsible for the profitability of the company, its expansion in the Asia-Pacific region and the development of new products and partnerships. Mr. Leow also serves as a director of our Sponsor, Mobiv Pte. Ltd. and our sponsor s holding company, Milan Vido Partners Pte. Ltd., both from December 2021. In addition, Mr. Leow serves as a member of the board of directors of Exodus Standard Sdn. Bhd. since January 2010 and as Chief Financial Officer of Revenue Harvest Sdn. Bhd. and Revenue Group Berhad since March 2022 and June 2022 respectively. Mr. Leow served as a director of IGC House Sdn. Bhd. from May 2021 through June 2022. Prior to joining ALLF Management Group Sdn. Bhd., Mr. Leow was the Chief Operating Officer at Galasys PLC from May 2014 to June 2017. As Chief Operating Officer, he managed the operations of Galasys PLC in China, Malaysia and the United Kingdom and was responsible for financial reporting, including compliance with U.K.-listing requirements, the development of research and development centers in Malaysia and global business development for the company. From June 2013 to April 2014, Mr. Leow was the Chief Financial Officer of Hitachi Sunway Information Systems Sdn. Bhd., where he established regional offices, including new subsidiaries in Indonesia, the Philippines and Vietnam, treasury functions for the company and new accounting systems, among other things. Mr. Leow was also responsible for the acquisition of new target companies. From March 2012 to May 2013, Mr, Leow served as the General Manager of the Sunway Lagoon Sdn. Bhd. Themepark in Selangor, Malaysia where he was responsible for business development, marketing, sales and finance and prior to that he was Head of Group Finance for Leisure and Hospitality Division of Sunway Berhad from June 2011 to February 2012, which includes two major theme parks in Malaysia and all of the hotel chains under Sunway Lagoon Resort Hotels and Allson International Hotel and Resorts brands where he lead a team of eight financial controllers. From May 2004 to May 2011, Mr. Leow held various positions including financial controller and director of finance, ultimately the last position was the director of business development in Sunway Lagoon Sdn. Bhd. before moving on to the Sunway Berhad. Prior to that, Mr. Leow worked as Senior Finance Manager at Season Confectionary Sdn. Bhd. in Johor, Malaysia from May 2003 to April 2004, as Finance Manager at TSB Fabrics Sdn. Bhd. from December 2000 to April 2003 in Kuala Lumpur, and as an Accountant at Mansfield Travel Sdn. Bhd from August 1997 to November 2000. After completing college, Mr. Leow first worked at Ho Chee Mee & Co from July 1995 to July 1997 as a Senior Audit Assistant. Mr. Leow holds a professional accounting qualification from Association of Chartered Certified Accountants and A Level from SEGi College, Subang Jaya, Selangor, Malaysia Mr. Leow is a chartered certified accountant and Fellow member of the Association of Chartered Certified Accountants and a member of the Malaysia Institute of Accountants. Our Independent Director Nominees Our efforts to seek a suitable business combination target will be complemented and augmented by the expertise and Our efforts to seek a suitable business combination target will be complemented and augmented by the expertise and network of relationships of our directors, who each have extensive experience in business and financial matters. The board is expected to be composed of our current directors, Peter Bilitsch and Weng Kiat (Adron) Leow, as well as three independent director nominees, Messrs. Lloyd Bloom, Garry Peagam and Niels Strohkirch. These individuals bring together a breadth of operating experience, industry connectivity including energy and automotive experience and proprietary access to leading companies that enhance our value proposition. We believe that our strategic board will be a driving force in our efforts to identify a target and effect a business combination and may invest personal capital in the transaction that one or more or our independent director nominees. The Company s independent director nominees biographies are presented here. Table of Contents Lloyd Bloom, Independent Director Nominee, Chair of our Compensation Committee and Member of our Audit Committee and Corporate Governance and Nominating Committee Mr. Lloyd Bloom will serve as an independent director and Chair of our Compensation Committee and Member of our Audit Committee and Corporate Governance and Nominating Committee following completion of this offering. Mr. Bloom is currently a director of Eclipse Market Solutions, LLC, where he has been since 2011, developing and consulting on financial technology. Mr. Bloom was also a trader at Vectra Capital from August 2015 to May 2017, where he managed proprietary risk arbitrage and position trading in commodity markets. Prior to that, Mr. Bloom served as the executive director of Mitsui Bussan Commodities Limited from 2003 to June 2013, where he worked to grow the company s natural gas and power trading book. Mr. Bloom was also involved in European electricity and natural gas trading while working as Managing Director at El Paso Energy from 1998 to 2002 where he formed cross commodity structured-product group and grew the European electricity and natural gas trading group. Prior to that, Mr. Bloom served in the role of Head of Trading at Sonat, Inc. from 1998 to 1998 where he built a power option trading platform and constructed a novel peaking distribution model of power prices. From 1988 to 1998, Mr. Bloom served as a Market Maker for the New York Commodity Floor and prior to that as an Associate Actuary for MetLife from 1986 to 1988 and for John Hancock from 1983 to 1985. Mr. Bloom holds a B.S. in Chemical Engineering and Economics from the Massachusetts Institute of Technology (1982) and an ASA in Mathematical Statistics and Probability from the Society of Actuaries (1987). We believe Mr. Bloom s qualifications to serve on our board of directors include his in-depth knowledge of commodities, trading and risk management as well as his experience as a director of various companies such as Eclipse Market Solutions LLC and Mitsui Bussan Commodities Limited. Garry Peagam, Independent Director Nominee, Chair of our Audit Committee and Member of our Compensation Committee and Corporate Governance and Nominating Committee Mr. Garry Peagam will serve as an independent director and Chair of our Compensation Committee and Member of our Audit Committee and Corporate Governance and Nominating Committee following completion of this offering. Since May 2019, Mr. Peagam has served as the Chairman (non-executive) of Fibre CRM Limited, a customer relationship management company for accountants and financial institutions that manages on-boarding, KYC, client data securely, runs AML checks and ongoing monitoring. Mr. Peagam is the founder of iCurious Limited, a consulting and real estate company for which he has been a director since June 2014. He has served as a trustee and director at the Julian House, a homeless charity in southwest United Kingdom since May 2020. Mr. Peagam served as a member of the Audit Committee for Plymouth University and served as an independent advisor to the Bristol City Council from 2015 to 2016, where he advised the council on all financial aspects of setting up a new energy supply business. Prior to that, Mr. Peagam served as the Group Finance Director of Good Energy Group PLC, a British renewable energy company specializing in the generation and selling of green energy to consumers, from June 2010 to October 2014 where he grew the company market cap to over 40 million and successfully financed and completed the repowering of 9.2 megawatt (MW) of wind generation and the financing for significant new solar generation. From April 2007 to April 2010, Mr. Peagam held the role of Managing Director of Mnetics Holdings Limited where he was brought in to oversee the company during a period of rapid expansion. Prior to that, he served as Group Finance Director at Stanley Black & Decker s European security company (formerly Blick Group PLC) from 2003 to 2004 and at Blick Group PLC from 1999 to 2003. Mr. Peagam worked for Southern Company Inc s UK generation and supply company (formerly South Western Electricity plc of Bristol, England) from 1991 to 1999 where he held many roles from Managing Director of their gas supply business to Head of Customer Service. His early positions include Chief Financial Accountant for CASE Group PLC from 1983 to 1988 and with Arthur Andersen from August 1978 to January 1982. Table of Contents Mr. Peagam holds a B.A. in Economics from Warwick University and is a Fellow member of the Institute of Chartered Accountants in England & Wales. We believe Mr. Peagam s qualifications to serve on our board of directors include his more than 20 years of experience in U.K.-based companies, multi-site worldwide subsidiaries and his roles spearheading acquisitions in the U.K. and globally. Niels Strohkirch, Independent Director Nominee, Chair of our Corporate Governance and Nominating Committee and Member of Compensation Committee and Audit Committee Mr. Niels Strohkirch will serve as an independent director and Chair of our Corporate Governance and Nominating Committee and Member of Compensation Committee and Audit Committee following completion of this offering. Mr. Strohkirch is currently the Project Chief Financial Officer and Head of Benchmarking & Implementation Management of Theron Scienceworcs AG, a German boutique management consultancy specializing in energy-dense industries, having served in this role since January 2020. On July 1, 2022, Mr. Strohkirch was appointed as Head of Strategy and Transformation for Fujitsu Services GmbH in Munich, Germany, a multinational information and communications technology equipment and services corporation, established in 1935 and headquartered in Tokyo. Prior to this, Mr. Strohkirch served as the Managing Partner at Expandeers (SouthEast Asia) PLT, a Kuala Lumpur-based professional network advising SMEs in Sales and Distribution from January 2018 to December 2019, and the Interim Chief Revenue Officer at Digital Way Ventures (HK) Limited, a Hong Kong-based family office in 2018. At Digital Way Ventures, Mr. Strohkirch was involved in the Round A financing of City Transformer, an electric city car that can change its width to conform to its surroundings. Mr. Strohkirch was the Chief Executive Officer and Co-founder of Kinslager Sdn. Bhd. in Kuala Lumpur, a digital bespoke tailoring start-up, from January 2013 to December 2017. From 2008 to 2012, Mr. Strohkirch served as Chief Financial Officer and member of the Directors Committee of the Valiram Group, which operates as a luxury goods retailer and distributor mainly in Asia-Pacific, with more than 300 million in sales and more than 1,000 staff at that time. Prior to that, he served as Vice President of Finance and Controlling, Administration (CFO) for DaimlerChrysler Malaysia Sdn. Bhd. in Malaysia managing about 400 million of turnover including Mercedes-Benz passenger cars, Mercedes-Benz commercial vehicles (truck, bus, van), Mercedes-Maybach sedan, Mitsubishi FUSO. Before joining DaimlerChrysler (Malaysia) Sdn. Bhd, Mr. Strohkirch worked in the role of Senior Manager, Business Development and Strategy for Digital Sales and Telematics for DaimlerChrysler AG in Germany from 2001 to 2004. Before that, Mr. Strohkirch had been active in various start-ups and finance functions. Mr. Strohkirch holds an M.B.A. equivalent from the University of Cologne (1997), attended the Advanced Executive Program of DaimlerChrysler at the International Institute for Management Development (IMD) and visited the Entrepreneurship Development Program at the Massachusetts Institute of Technology Sloan School of Management. We believe Mr. Strohkirch s qualifications to serve on our board of directors include his extensive experience in the automotive industry, acquisition activities and start-up businesses as well as his executive roles in numerous public and private companies in Europe and Asia. We believe that our independent director nominees will provide public company governance, executive leadership, operational oversight, private equity investment management and capital markets experience. Our board members have extensive experience, having served as directors or officers for numerous publicly-listed and privately-owned companies. Our directors have experience with acquisitions, divestitures and corporate strategy and implementation, which we believe will significantly benefit us as we evaluate potential acquisition or merger candidates as well as following the completion of our initial business combination. We believe our management team is well positioned to take advantage of the growing set of acquisition opportunities focused on the EV and urban mobilization sector and that our contacts and relationships, ranging from owners and management teams of private and public companies, private equity funds, investment bankers, attorneys, to accountants and business brokers will allow us to generate an attractive transaction for our stockholders. Table of Contents In addition, our sponsor has engaged the services of ARC Group Limited to provide financial advisory services to our sponsor in connection with this offering, which services include an analysis of markets, positioning, financial models, organizational structure and capital requirements as well as assistance with the public offering process including assisting in the preparation of financial information and statements. Our sponsor has also engaged Felix Heinimann pursuant to an executed Consultancy Agreement effective April 28, 2022 to serve as the Global Head of Public Relations and Stakeholder Management in connection with the approval of the company s initial business combination and shareholder approval. The past performance of the members of our management team, our sponsor s financial advisor or their affiliates is not a guarantee that we will be able to identify a suitable candidate for our initial business combination or of success with respect to any business combination we may consummate. You should not rely on the historical record of the performance of our management team or any of its affiliates performance as indicative of our future performance. Each of our officers and directors may become an officer or director of another special purpose acquisition company with a class of securities intended to be registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act, even before we have entered into a definitive agreement
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+summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled "Risk Factors" and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: "amended and restated memorandum and articles of association" are to the amended and restated memorandum and articles of association that the company will adopt upon the consummation of this offering; "Companies Act" are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; "equity-linked securities" are to any debt or equity securities that are convertible, exercisable or exchangeable for our Class A ordinary shares issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt; "founder shares" are to our Class B ordinary shares initially issued to our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof (for the avoidance of doubt, such Class A ordinary shares will not be "public shares"); "initial shareholders" are to the holders of our founder shares prior to this offering (or their permitted transferees); "management" or our "management team" are to our officers and directors (including our director nominees that will become directors in connection with the consummation of this offering); "ordinary resolution" are to a resolution adopted by the affirmative vote of at least a majority of the votes cast by the holders of the issued shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter; "ordinary shares" are to our Class A ordinary shares and our Class B ordinary shares; "placement units" are to the units to be issued to our sponsor in a private placement simultaneously with the closing of this offering and upon conversion of working capital loans, if any, with each placement units consisting of one placement share, one-half of one placement warrant and one placement right to receive one-tenth of one Class A ordinary share upon the consummation of a business combination; "placement shares" are to our Class A ordinary shares included within the placement units being purchased by our sponsor in the private placement; "placement rights" are to the rights included within the placement units being purchased by our sponsor in the private placement; "placement warrants" are to the warrants included within the placement units being purchased by our sponsor in the private placement; "public shares" are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); "public shareholders" are to the holders of our public shares, including our sponsor and management team to the extent our sponsor and/or members of our management team purchase public shares, provided that our sponsor s and each member of our management team s status as a "public shareholder" will only exist with respect to such public shares; "public rights" are to the rights sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); "public warrants" are to warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); "representative" are to JonesTrading Institutional Services LLC, who is the representative of the underwriters in this offering; "rights" are to our rights, which include the public rights as well as the placement rights; 1 Table of Contents "SEC" are to the U.S. Securities and Exchange Commission; "SPAC" are to special purpose acquisition companies; "special resolution" are to a resolution adopted by the affirmative vote of at least a two-thirds majority (or such higher threshold as specified in the company s amended and restated articles of association) of the votes cast by the holders of the issued shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter; "sponsor" is to PROTONIQ LLC, a Cayman Islands limited liability company; "underwriters" are to the underwriters of this offering, for which the representative is acting as representative; "warrants" are to our redeemable warrants, which includes the public warrants as well as the placement warrants and any warrants issued upon conversion of working capital loans or extension deposits; and "we," "us," "our," "company" or "our company" are to PROTONIQ Acquisition Corp, a Cayman Islands exempted company. Any forfeiture of shares described in this prospectus will take effect as a surrender of such shares for no consideration as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Our Company We are a newly incorporated blank check company formed as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. Throughout this prospectus we will refer to this as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. Business Opportunity We believe that there are a significant number of target companies globally (with particular focus on opportunities in the Asia-Pacific (APAC) region), that could become attractive public companies, and we will seek to capitalize on the extensive operational and investment experience of our Founders and focus on companies that we believe are attractively valued and have significant growth prospects with the potential to generate robust value for our shareholders. Although we may acquire a company in any industry, we currently intend to concentrate our efforts on identifying technology businesses in the financial services industry with a focus on delivering differentiated financial services in the wealth management, financial advisory and investment management sectors. 2 Table of Contents Our management team is composed of disciplined acquirers with long-term track records of sourcing and acquiring value accretive businesses, building next-generation businesses across industries globally and generating significant returns for investors from those businesses. They are particularly experienced in the financial services industry, including integrated wealth and investment management platforms, and will provide investors with differentiated insights and access to sourcing opportunities. Each of these attributes will be further supported by the longstanding, deep expertise and accretive skillsets of the other Founders, each of whom has a track record of delivering value for investors. We intend to capitalize on the ability of the Founders to identify, acquire and manage businesses in the global financial services space that can benefit from their experience and differentiated global network. We intend to merge with a target, that together with our management team s expertise we believe can build a substantial integrated global wealth and investment management platform focused on serving all its clients financial needs holistically, offering a full suite of services including wealth advisory, insurance, investment management, investment banking services, asset order and settlement, cash management and payment gateways. We will select a target that is capable of growing both organically and through acquisitions. We intend to capitalize on the robust consolidation activity in the high-growth fragmented global wealth and investment management sectors. As disciplined acquirers focused on value enhancement, we believe we can also drive significant additional value to our shareholders through our ability to arbitrage the valuation differentials that exist globally between companies matching our business combination criteria and that apply to a significantly scaled, high-growth and well-resourced listed entity generating above average ROCE (return on capital employed). Our Sponsor, Executive Management Team, and Directors Our officers and directors consist of seasoned industry executives with an extensive track record of sourcing and acquiring value accretive businesses, building next-generation businesses across industries globally and generating significant returns for investors from those businesses. In particular, the team possesses a deep understanding of the FinTech sector, corporate governance, wealth management, and M&A. We believe our management team, together with the support of our directors, is well-positioned to identify and access a differentiated range of investment opportunities in the wealth management, financial advisory and investment management sectors by capitalizing on their reputation and deep network of relationships. We believe that our team s expertise and experience in the financial services industry, including integrated wealth and investment management platforms, combined with our extensive relationships through a network of advisors and affiliates, will make us a partner of choice for potential business combination targets. We intend to capitalize on the ability of the founders to identify, acquire and manage businesses in the global financial services space that can benefit from their experience and differentiated global network. Our sponsor is controlled by Babar Ali, a non-U.S. person. We may not be able to complete an initial business combination with a U.S. target company since such initial business combination may be subject to U.S. foreign investment regulations and review by a U.S. government entity, such as the Committee on Foreign Investment in the United States (CFIUS), and ultimately prohibited. As a result, the pool of potential targets with which we could complete an initial business combination may exclude U.S. targets or the time necessary for government review of the transaction or a decision to prohibit the transaction with a U.S. target could prevent us from completing an initial business combination in a timely fashion and require us to liquidate. If we liquidate, the investors will lose any potential investment opportunity in a target company and the chance of realizing future gains on investment through any price appreciation in the combined company, and the warrants would expire worthless. See "Risk Factors —We may not be able to complete an initial business combination with a U.S. target company since such initial business combination may be subject to U.S. foreign investment regulations and review by a U.S. government entity, such as the Committee on Foreign Investment in the United States (CFIUS), and ultimately prohibited." 3 Table of Contents Executive Management Team Babar Ali, our Chief Executive Officer and Director, has over 20 years of experience in the wealth management and fintech industries. From June 2019 through January 2022, he served as Executive Director on the Risk and Audit Committee of NewQuantum Holdings, a wealth management solutions provider. In his advisory role, he provides leadership to successfully achieve the product market fit. From January 2018 until June 2019, Mr. Ali served as Founder and Head of Trading at Goodments Pty Ltd, an investing app designed to promote ESG investing. Prior to that, from June 2015 to January 2018, he served as Founder and CTO of WealthO2, which offers a suite of wealth management software solutions for advisers. Between January 2012 and June 2015, Mr. Ali was the Chief Technology Officer of Fortnum Private Wealth, a financial planning firm. Prior to that, from January 2005 to January 2012, he held various senior roles in tax and accounting at Deloitte and Thomson Reuters. Mr. Ali graduated from Western Sydney University with a Bachelor of Science degree in Computer Science in 2005. He is currently completing a PhD in Data Science through the University of Technology Sydney with 2025 as the expected graduation year and an MBA from the Macquarie Graduate School of Management with 2023 as the expected graduation year. Mr. Ali s extensive experience and knowledge in implementing enabling technologies and enterprise systems that facilitate business processes and strategic objectives make him a valuable addition to our management team and board of directors. Atle Crowe-Maxwell, our Chief Financial Officer and Director, has over 30 years insolvency, forensic accounting, and business advisory experience. Since July 2020, he has served as Managing Director at DBA Reconstruction and Advisory, an international professional service outsourcing firm. In this role, Mr. Crowe-Maxwell undertakes Corporate Restructuring, Director and Board advice, forensic accounting as well as formal insolvency appointments. From November 2015 to July 2020, he served as the Head of Business Advisory at Omniwealth, a diversified financial services firm. He also served on the board of Omniwealth from 2015 to 2018. In this role, Mr. Crowe-Maxwell helped build business advisory and succession planning services for the firm. Prior to that, from August 2012 to October 2015, Mr. Crowe-Maxwell served as Business Unit Leader, Business Recovery, and Insolvency for the East Coast Practice at BDO (Binder Dijker Otte), an audit, tax, and advisory services firm. From 2012 to 2015, Mr. Crowe-Maxwell served on the board of directors of the Gidget Foundation, which supports the wellbeing of expectant and new parents. From 2011 to 2014, he also served on the board of the BDO East Coast Practice. Between July 2001 and August 2012, Mr. Crowe-Maxwell served as Manager in the Forensic Accounting and Litigation Support practice at Arthur Andersen. From April 1997 to September 1998, he served as Supervisor, Insolvency at Smith Hancock. He provided reviews and solvency assessments for banks and other corporate entities, litigation, formal insolvency assignments, and business advisory assignments. From April 1995 through March 1997, he served as Supervisor, Insolvency for Ferrier Hodgson. Prior to that, between February 1992 and March 1995, he was a Senior Accountant, Insolvency at KPMG. Mr. Crowe-Maxwell graduated from Macquarie University in 1991 with a Bachelor of Economics (Accounting, Finance and Business Law). In 1996, he took a Professional Year at the Institute of Chartered Accountants in Australia. In 2002, he received his professional insolvency qualifications through the University of Southern Queensland. In 2005, he became a registered liquidator with ASIC. We believe that Mr. Crowe-Maxwell s experience in solvency assessments for banks and other corporate entities and his extensive experience with forensic accounting and evaluating financial and strategic operations of companies in diverse industries make him a valuable member of our management team. Brett Westbrook, our Independent Director nominee, has over 40 years of experience in the financial services sector. Since December 2019, he has served as Executive Director of Jigsaw Capital No. 2, a Corporate Advisor in the Australian Market. In this role, Mr. Westbrook is a joint owner and senior advisor. Since October 2019, he has also served as the Executive Director of New Quantum, a wealth management solutions provider. In addition to fulfilling his director responsibilities he has provided consulting advice. Since September 2020, he has served as Chief Operating Officer of YourPortfolio.com, a financial portfolio consolidation app for retail customers. He is one of the founders of this business. From January 2015 to May 2019, Mr. Westbrook served as Executive Director for WealthO2, which offers a suite of wealth management software solutions for advisers. In this role, Mr. Westbrook acted as a Responsible Managers on its Australian Financial Services Licence (AFSL). Brett was one of the Founders of this business. He received an MBA from Melbourne University in May 2006. As a result of his professional and academic experiences, Mr. Westbrook brings extensive breadth, depth and knowledge in the operational and management services combined with an expertise in wealth management solutions to our management team. Denis Durand, our Independent Director nominee, has over 20 years of private sector experience in the investment and financial advisory industry, working with companies such as Deloitte, CBA and MLC. Since 2009, Mr. Durand has served as a Director of Durand Financial Services and Melbourne Loans & Finance, a comprehensive finance solutions firm. In this role, Mr. Durand and his team managed over $250 million of client and corporate funds and specialized in investment advice for high net wealth individuals, business owners, and corporate clients. Further, Mr. Durand has co-hosted the television program "Australian Success," and "Money Segment" on ABC 774 in 2005. In 1995, Mr. Durand graduated from Latrobe University Melbourne with a Bachelor in Economics degree and in 2003, he graduated with a Diploma of Financial Planning from Deakin University. 4 Table of Contents Bharat Patel, our Independent Director nominee, has over 10 years of financial services experience in Australian financial markets. He has extensive domestic and international experience and familiarity with technology and data businesses from strategy, infrastructure, delivery, regulatory, operational and customer perspectives. Since January 2011, he has worked for the Australian Securities and Investments Commission as a Senior Specialist – Market Infrastructure Technology. In this role, Mr. Patel has led the development and execution of ASIC s supervisory strategy for Cyber & Operational Resilience in Australian Financial Markets, as well as the Data Analytics strategy to deliver investigative analytics to enable monitoring and investigation of market trading activity. He also provides leadership and expertise in the areas of technology architecture, technology governance, risk management and quality assurance within the markets group to support effective supervision of regulated activities providing critical services to financial markets, particularly in areas where novel technologies, architectures or methodologies are being deployed. Prior to that, from June 2007 to March 2010, he served as the Chief Information Officer (Australia & New Zealand) for Thomson Reuters Tax, Legal & Regulatory. From June 2003 to May 2007, he served as Chief Information Officer (Asia Pacific) for Thomson Reuters Tax, Legal & Regulatory. In this role, he led the technology group and managed large-scale business transformation programs for digital content delivery, platform rationalization and operational optimizations to significantly improve customer value propositions and delivering stronger revenue growth for the organization. From June 1999 to June 2003, Mr. Patel served as European Services Director at Artesia Technologies Europe (now OpenText Corp.), an information management software company, specialized in media asset management, digital workflow solutions, and business process optimization. He was accountable for the delivery of digital transformation programs for global corporates including Sony Music Europe, General Motors and the British Broadcasting Corporation (BBC) amongst others, which transformed the way in which those corporates managed and delivered digital assets to efficiently service its clients and partners globally, as well as optimizing their own information flows and creating new opportunities for growth. In 1984, Mr. Patel graduated with honors from University College, London with a Bachelor of Science degree in mathematics. His professional certifications include TOGAF 9 Enterprise Architecture, MSP (Managing Successful Programmes), and PRINCE2 – Project Management. We believe Mr. Patel is well-qualified to serve on our board due to his deep technical knowledge, and extensive experience in leading large-scale digital transformation programs, mergers and acquisitions, and implementation of novel technology solutions. Marco Bardelli, our Independent Director nominee, has over 25 years of experience in the finance industry. Since 2014, he has worked at Citramas Group in Singapore, supporting the Chairman and CEO s activity in strategic & corporate planning, governance overview, business development, and investment. His various directorships for Citramas Group include Executive Director of Nongsa Digital Park, Project Coordinator for the Data Centre Hub at Nongsa Digital Park, Project Coordinator for Infinite Learning Apple Developer Academy, Executive Director at Infinite Studios, and Division Head for Infinite Metaverse. From 2005 through 2013, he served as CEO and Managing Director at UBI Banca Group. From 1997 to 2005, Mr. Bardelli was Chief Regional Representative at UBI Banca Group. From 1995 through 1996, he was Vice President at UBI Banca Group in Honk Kong. He received his MBA from the University of Chicago in 2009. 5 Table of Contents Business Strategy and Competitive Strengths Our acquisition and value creation strategy is to identify and complete our initial business combination with a market-leading, growth-oriented company. Although we may acquire a company in any industry, we intend to concentrate our efforts on identifying a high-growth FinTech business primarily operating in the APAC region with a high volume of customers and growing demand. We believe there are several FinTech companies poised to become multi-billion-dollar enterprises by leveraging emerging technologies and expanding into developing markets. We believe our experience in the FinTech sector will help us identify potential targets that have a strong foundation that can be expanded into the global marketplace with a diverse portfolio of products and services for consumers and businesses in the United States, United Kingdom, and the APAC region. Applying Our Marketing and Management Experience Our team includes experienced professionals with experience in FinTech, wealth management platforms, superannuation, and financial advice. We believe the experience of our management team can help transition and expand target businesses into a global financial services platform. Our management has experience developing and leading FinTech companies that launched wealth management and investment platforms in the APAC region. Our team has helped develop platforms applications and services for cross-border investment management platforms, online payment gateways, interchangeable and multicurrency systems. Our team also maintains a robust network in the FinTech sector, including successful high growth companies in the APAC region as well as FinTech companies in the United Kingdom and the United States. We believe these contacts and partners will help facilitate sourcing of potential business combination targets. Leveraging Emerging Technologies We believe there are opportunities to leverage emerging technologies such as blockchain, cryptocurrencies and decentralized finance, as well as artificial intelligence (AI), machine learning, deep learning, and cloud computing, to reduce costs and processing time, create real time settlements, and improve the money delivery process. Our team has experience in the design and development of digital payment products, payment gateways, cybersecurity, scalable architecture, blockchain, and AI. We also believe we will benefit from leveraging a broad network of contacts and corporate relationships in the software development markets of the APAC region and the United States. Business Combination Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. We plan to use these criteria and guidelines in evaluating initial business combination opportunities, but we may decide to consummate our initial business combination with a target business that does not meet one or more of these criteria and guidelines. We intend to seek to acquire companies within industries that exhibit strong characteristics including, but not limited to, the following: significant established market position and domestic and international expansion potential, its own solid technological base or access to a stable, capable outside supplier, capability and commitment to full financial markets regulation and SEC compliance, and a motivated and capable management team. While we may pursue an initial business combination opportunity in any business, industry, sector or geographic region, we intend to focus on the acquisition of a high-growth FinTech business. We intend to identify opportunities globally but will focus on attractive opportunities operating in the APAC region. We intend to merge with a target, that together with our management team s expertise we believe can build a substantial integrated global wealth and investment management platform focused on serving all its clients financial needs holistically, offering a full suite of services including wealth advisory, insurance, investment management, investment banking services, asset order and settlement, cash management and payment gateways. We will select a target that is capable of growing both organically and through acquisitions. We intend to capitalize on the robust consolidation activity in the high-growth fragmented global wealth and investment management sectors. As disciplined acquirers focused on value enhancement, we believe we can also drive significant additional value to our shareholders through our ability to arbitrage the valuation differentials that exist globally between companies matching our business combination criteria and that apply to a significantly scaled, high-growth and well-resourced listed entity generating above average ROCE (return on capital employed). These criteria and guidelines are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general criteria and guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into an initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria and guidelines in our shareholder communications related to our initial business, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials, as applicable, that we would file with the SEC. 6 Table of Contents Our Business Combination Process In evaluating a prospective target business, we expect to conduct a thorough due diligence review that will encompass, among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities, as well as reviewing financial and other information that will be made available to us. We will also utilize our operational and capital allocation experience. Our acquisition criteria, due diligence processes and value creation methods are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC. Sourcing of Potential Business Combination Targets We believe that the operational and transactional experience of our management team and our sponsor and their respective affiliates and related entities and the relationships they have developed as a result of such experience, will provide us with a substantial number of potential business combination targets. These individuals and entities have developed a broad network of contacts and corporate relationships around the world. This network has grown through sourcing, acquiring and financing businesses and maintaining relationships with sellers, financing sources and target management teams. Our management team and members of our sponsor and their respective affiliates and related entities have significant experience in executing transactions under varying economic and financial market conditions. We believe that these networks of relationships and this experience will provide us with important sources of investment opportunities. In addition, we anticipate that target business candidates may be brought to our attention from various unaffiliated sources, including investment market participants, private equity funds and large business enterprises seeking to divest noncore assets or divisions. We are not prohibited from pursuing an initial business combination with a business combination target that is affiliated with our sponsor, officers or directors (or their respective affiliates or related entities) or making the acquisition through a joint venture or other form of shared ownership with our sponsor, officers or directors (or their respective affiliates or related entities). In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors (or their respective affiliates or related entities), we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or an independent accounting firm that our initial business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other context. As more fully discussed in "Management—Conflicts of Interest," if any of our officers or directors becomes aware of a business combination opportunity that falls within the line of business of any entity to which he or she has then-current fiduciary or contractual obligations, he or she may be required to present such business combination opportunity to such entity prior to presenting such business combination opportunity to us, subject to his or her fiduciary duties under Cayman Islands law. Our officers and directors currently have certain relevant fiduciary duties or contractual obligations that may take priority over their duties to us. Other Acquisition Considerations In addition to our sponsor, members of our management team may directly or indirectly own our ordinary shares and/or placement units following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. 7 Table of Contents Each of our directors and officers presently has, and in the future any of our directors and our officers may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present acquisition opportunities to such entity. Accordingly, subject to his or her fiduciary duties under Cayman Islands law, if any of our officers or directors becomes aware of an acquisition opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she may need to honor his or her fiduciary or contractual obligations to present such acquisition opportunity to such entity, and only present it to us if such entity rejects the opportunity. Our amended and restated memorandum and articles of association will provide that, subject to his or her fiduciary duties under Cayman Islands law, no director or officer shall be disqualified or prevented from contracting with the company nor shall any contract or transaction entered into by or on behalf of the company in which any director shall have an interest be liable to be avoided. A director shall be at liberty to vote in respect of any contract or transaction in which he is interested provided that the nature of such interest shall be disclosed at or prior to its consideration or any vote thereon by the board of directors. We do not believe, however, that any fiduciary duties or contractual obligations of our directors or officers would materially undermine our ability to complete our business combination. Our officers and directors may become an officer or director of another special purpose acquisition company with a class of securities registered under the Securities Exchange Act of 1934, as amended, or the Exchange Act even before we enter a definitive agreement regarding our initial business combination. Initial Business Combination Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the prior owners of the target business, the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the "Investment Company Act"). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses, and we will treat the target businesses together as our initial business combination for purposes of a tender offer or for seeking shareholder approval, as applicable. 8 Table of Contents To the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all
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+S-1 1 dynamicinnovative_s1.htm S-1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-1 SEC FILE #: 333-252505 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 DYNAMIC INNOVATIVE SOLUTIONS LIMITED (Exact name of registrant as specified in its charter) Nevada 7372 None (State or jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) DYNAMIC INNOVATIVE SOLUTIONS LIMITED 50 West Liberty Street, Suite 880 Reno, NV 89501 Telephone: (775) 322-0626 Email: info_dynamicsolutions@yahoo.com (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Nevada Agency and Transfer Company 50 West Liberty Street, Suite 880, Reno, Nevada 89501, Telephone: (775) 322-0626 Email address: info@natco.com (Name, address, including zip code, and telephone number, including area code, of agent for service) Approximate date of proposed sale to the public: as soon as practicable after the effective date of this Registration Statement If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act (Check one): Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. Table of Contents CALCULATION OF REGISTRATION FEE TITLE OF EACH CLASS OF SECURITIES TO BE REGISTERED AMOUNT TO BE REGISTERED PROPOSED MAXIMUM OFFERING PRICE PER UNIT (1) PROPOSED MAXIMUM AGGREGATE OFFERING PRICE AMOUNT OF REGISTRATION FEE Common Stock 25,000,000 $ 0.02 per share $500,000 $46.35 (1)There is no current market for the securities and the price at which the shares are being offered has been arbitrarily determined by us and used for the purpose of computing the amount of the registration fee in accordance with Rule 457 under the Securities Act of 1933, as amended. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. SUBJECT TO COMPLETION, Dated August 18, 2022 Table of Contents The information in this prospectus is not complete and may be changed. The securities may not be sold until the registration statement of which this prospectus forms a part is declared effective by the SEC. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUBJECT TO COMPLETION, dated August 18, 2022 PRELIMINARY PROSPECTUS DYNAMIC INNOVATIVE SOLUTIONS LIMITED UP TO 25,000,000 SHARES OF COMMON STOCK AT $0.02 PER SHARE This is the initial offering of common stock of Dynamic Innovative Solutions Limited, a Nevada corporation, and no public market currently exists for the securities being offered. We are offering for sale a total of up to 25,000,000 shares of common stock at a fixed price of $0.02 per share for aggregate net proceeds of up to $500,000.00, assuming that the entire offering is completed. There is no minimum number of shares that we must sell for the offering to proceed and we will retain the proceeds from the sale of any of the offered shares. The offering is being conducted on a self-underwritten, best efforts basis, which means our director, Wing Leung Ho, will attempt to sell the shares without the participation of an underwriter. This prospectus will permit our director to sell the shares directly to the public, with no commission or other remuneration payable to him for any shares he may sell. We will pay all expenses incurred in this offering. In offering the securities on our behalf, Mr. Ho will rely on the safe harbor from broker-dealer registration set out in Rule 3a4-1 under the Securities and Exchange Act of 1934. The shares will be offered at a fixed price of $0.02 per share for a period of one hundred and eighty (180) days from the effective date of this prospectus. The funds raised in this offering will not be placed into an escrow account or trust account and will be immediately accessible to us to be used to fund our business development. Any funds raised from the offering will be immediately available to us for our immediate use. We are considered an emerging growth company as defined in the Jumpstart Our Business Startups Act and will be subject to reduced public company reporting requirements. There has been no market for our securities and a public market may never develop, or, if any market does develop, it may not be sustained. Our common stock is not traded on any exchange or on any over-the-counter market. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with the Financial Industry Regulatory Authority ( FINRA ) for our common stock to be eligible for trading on the OTC Markets. We do not have a market maker who has agreed to file such an application. There can be no assurance that our common stock will ever be quoted on a stock exchange or a quotation service or that any market for our stock will develop. THE PURCHASE OF THE SECURITIES OFFERED THROUGH THIS PROSPECTUS INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD CAREFULLY READ AND CONSIDER THE SECTION OF THIS PROSPECTUS ENTITLED RISK FACTORS BEFORE BUYING ANY SHARES OF OUR COMMON STOCK. NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE WILL NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT IS FILED WITH THE U.S. SECURITIES AND EXCHANGE COMMISSION AND HAS BEEN CLEARED OF COMMENTS AND IS DECLARED EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OF SALE IS NOT PERMITTED. DEALER PROSPECTUS DELIVERY OBLIGATION Until ___________, all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealer s obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions. i Table of Contents PROSPECTUS SUMMARY THE FOLLOWING SUMMARY IS NOT COMPLETE AND DOES NOT CONTAIN ALL OF THE INFORMATION THAT MAY BE IMPORTANT TO YOU. YOU SHOULD READ THE ENTIRE PROSPECTUS BEFORE MAKING AN INVESTMENT DECISION TO PURCHASE OUR COMMON STOCK. ALL FINANCIAL INFORMATION IS STATED IN UNITED STATES DOLLARS UNLESS OTHERWISE SPECIFIED. OUR FINANCIAL STATEMENTS ARE PREPARED IN ACCORDANCE WITH ACCOUNTING PRINCIPALS GENERALLY ACCEPTED IN THE UNITED STATES. You should rely only on information contained in this prospectus. We have not authorized any other person to provide you with different information. This prospectus is neither an offer to sell, nor is it seeking an offer to buy, these securities in any state where the offer or sale is not permitted. The information in this prospectus is complete and accurate as of the date on the front cover, but the information may have changed since that date. We were incorporated on March 1, 2022 under the laws of the state of Nevada. We are a development stage company that is currently developing an online learning and corporate training computer and mobile device application known as Learning Hub . An online distance learning and corporate training service, also known as e-learning or e-training, is a platform that, via websites and mobile apps, offers learners with a wide range of online learning opportunities including e-learning courses that are developed and produced by the corporations. The computer application that we are developing is intended to provide learners with convenient means of learning. They can watch the course clips anywhere and anytime they prefer. Traditional learning platform facilitates corporations providing learning clips to learning. (usually their employees). However, Learning Hub offers additional capabilities, such as online handouts, polling, online assignment, group discussions etc. We anticipate that we will need to spend an additional $5,000.00 in order to complete the computer application. From our inception on March 1, 2022 until the date of this filing we have had limited operating activities, primarily consisting of the incorporation of our company, the initial funding by our director, and the acquisition of the Learning Hub application. As a development-stage company, we have not realized any revenues to date and our accumulated deficit as of April 30, 2022 is $6,780. To date, we have issued an aggregate of $24,000.00 through the sale of our common stock to our director and other shareholders. Proceeds from these sales will be used to fund this offering and for working capital. Our independent auditor has issued an audit opinion with respect to our financial statements for the period ended April 30, 2022, which includes a statement expressing substantial doubt as to our ability to continue as a going concern. Our principal offices are located at 50 West Liberty Street, Suite 880, Reno, Nevada 89501, USA. Our telephone number is (775) 322-0626 and our email address is info_dynamicsolutions@yahoo.com. In order to complete the development of our computer application, we will require approximately an additional $5,000. From the date that we secure this financing, we anticipate that we will be able to launch the application in the United States and commence offering online learning and corporate training services platform within 12 months. However, this assumes that we do not encounter any delays in testing our application. We will also require additional funding in order to expand our business operations. Investors must be aware that we do not have sufficient capital to independently finance our own plans. We have no plans, arrangements or contingencies in place in the event that we cease operations, in which case investors would likely lose their entire investment. This is a direct participation offering since we are offering the stock directly to the public without the participation of an underwriter. Our director will be solely responsible for selling shares under this offering and no commission will be paid to him on any sales. There has been no market for our securities and a public market may never develop, or, if any market does develop, it may not be sustained. Our common stock is not traded on any exchange or on the over-the-counter market. After the effective date of the registration statement relating to this prospectus, we will seek to have a market maker file an application with FINRA for our common stock to be eligible for trading on the OTC Markets quotation system. We do not have an arrangement in place for a market maker to file such and application and there is no guarantee that we will be able to find one to do so. 1 Table of Contents The Offering: Securities offered: Up to 25,000,000 shares of our common stock, par value $0.0001 per share. Offering price: $0.02 Duration of offering: This offering will terminate upon the earlier to occur of (i) 365 days after this registration statement becomes effective with the Securities and Exchange Commission, or (ii) the date on which all 25,000,000 shares registered hereunder have been sold. We may, at our discretion, extend the offering for an additional 90 days. At any time, and for any reason, we may also terminate the offering. Net proceeds to us: $500,000.00, assuming the maximum number of shares sold. Such $500,000.00 in gross proceeds does not account for the offering expenses in this offering. See the section entitled Use of Proceeds for further information. Market for the common shares: There is no public market for our shares. Our common stock is not traded on any exchange or on the over-the-counter market. After the effective date of the registration statement relating to this prospectus, we hope to have a market maker file an application with the Financial Industry Regulatory Authority for our common stock to eligible for trading on OTC Markets quotation system. We do not yet have a market maker who has agreed to file such application. There is no assurance that a trading market will develop, or, if developed, that it will be sustained. Consequently, a purchaser of our common stock may find it difficult to resell the securities offered herein should the purchaser desire to do so when eligible for public resale. Shares outstanding prior to offering: 150,000,000 Shares outstanding after offering: 175,000,000, assuming the entire offering is sold. Risk Factors: The common stock offered hereby involves a high degree of risk and should not be purchased by investors who cannot afford the loss of
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001942432_tsingurall_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001942432_tsingurall_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..69faac99bd69ccb0270e3c3eb4462422522f3d9c
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001942432_tsingurall_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 5
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001947250_greifenber_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001947250_greifenber_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001947250_greifenber_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CIK0001952202_jinrong_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CIK0001952202_jinrong_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..f55e447985fc9779fe62ef10dcd82a60583a3527
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CIK0001952202_jinrong_prospectus_summary.txt
@@ -0,0 +1,555 @@
+PROSPECTUS SUMMARY
+
+ 
+
+The following summary is qualified in its entirety
+by, and should be read in conjunction with, the more detailed information and financial statements appearing elsewhere in this prospectus.
+In addition to this summary, we urge you to read the entire prospectus carefully, especially the risks of investing in our Ordinary Shares
+discussed under Risk Factors before deciding whether to buy our Ordinary Shares.
+
+ 
+
+Our Company
+
+ 
+
+Jinrong Holdings (Hainan) Group
+Co. was established on March 19, 2021. Jinrong Holdings Group has invested and opened a number of health management hospitals, mainly
+for the prevention of cardiovascular diseases, prevention of heart attack, cerebral infarction, hemiplegia, for sub healthy people, to
+build a big health international brand.
+
+ 
+
+The Group adheres to the prevention-oriented
+approach and advocates the "treating the disease before it happens" project, solving chronic diseases and preventing cardiovascular
+and cerebrovascular diseases in advance through non-pharmacological treatment methods. The Group cooperates strategically with private
+hospitals in different regions to connect with famous doctors and doctors from all over the country to precisely solve the problems of
+chronic diseases. We provide health consultation and advice to our customers, and sell special treatment services to our customers, and
+these special treatment services are provided by Jinrong Holding (Hainan) Group Co.
+
+ 
+
+Our Business
+
+ 
+
+Our business is dedicated to the prevention and treatment
+of cardiovascular and cerebrovascular diseases. By providing health consultation and advice to our customers, we provide chronic disease
+treatment solutions to reduce the risk of cardiovascular and cerebrovascular diseases and achieve cardiovascular and cerebrovascular medical
+protection for our users.
+
+ 
+
+1) Subhealth testing and assessment
+
+2) Ozone autologous blood transfusion therapy
+
+3) Brain-awakening and enlightening technique
+
+4) Dual hemodialysis
+
+ 
+
+Industry background
+
+1) Prevalence 
+
+ 
+
+According to the 2020 China Cardiovascular Health
+and Disease Report, the prevalence of cardiovascular disease (CAD) in China continues to rise and is estimated to be 330 million. In China,
+with the implementation of family planning policies and increased life expectancy over the past few years, the country has entered an
+aging society, and the number of people with CAD in China increased from 23.3 million to 25.3 million between 2017 and 2020, with a compound
+annual growth rate of 2.78%, and is expected to reach 26.7 million in 2022.
+
+ 
+
+With the development of China's economy and the improvement
+of people's living standard, especially the change of people's diet and lifestyle, the prevalence of cardiovascular diseases in China
+has shown a significant increasing trend. The mortality rate of cardiovascular diseases in China is the first in the composition of disease
+deaths, higher than that of tumors and other diseases, and 2 out of 5 deaths are due to cardiovascular diseases. Cardiovascular disease
+risk factors mainly include hypertension, diabetes, dyslipidemia, etc., thus prompting the market space for anti-hypertension, diabetes
+treatment and lipid-lowering drugs in China to rise year by year.
+
+ 
+
+ 6 
+
+ 
+
+ 
+
+ 
+
+Overall, the prevalence and mortality of cardiovascular
+disease in China is still on the rise. There are currently 290 million people with cardiovascular disease, including 270 million with
+hypertension, 13 million with stroke, 11 million with coronary heart disease, 5 million with pulmonary heart disease, 4.5 million with
+heart failure, 2.5 million with rheumatic heart disease, and 2 million with congenital heart disease.
+
+ 
+
+2) Factors triggering cardiovascular and cerebrovascular.
+
+ 
+
+Health influencing factors : smoking, unreasonable
+diet, lack of exercise, obesity and overweight, psychological stress
+
+ 
+
+Chronic disease factors: hypertension, dyslipidemia,
+diabetes, etc.
+
+ 
+
+Our Challenge
+
+ 
+
+1) Our history is limited
+
+Jinrong Holdings (Hainan) Group
+Co. was established in Ordos on March 19, 2021, as a health care company that has not operated for decades or centuries, we still have
+a big gap compared to many companies with a long history, and our current achievements certainly correspond to our growth years have been
+a lot of achievements, but we still need to work hard to those who have more years of accumulation. We still need to work hard to be on
+par with companies with more years of experience.
+
+ 
+
+2) Retention of management personnel
+
+Our success depends to a large extent on the efforts
+and capabilities of our senior management and key personnel. Competition for qualified executives and key personnel is intense. Although
+we maintain non-competition and non-disclosure covenants with many of our key personnel and we have employment agreements with key personnel,
+all of our employees are "at-will employees." The loss of the services of one or more key employees, or the inability to hire,
+train and retain other key personnel, could delay the development and sale of our products and disrupt our business and affect our ability
+to execute our business plan.
+
+ 
+
+3) War, terrorism or other unknown and unexpected
+events
+
+Involvement in war or other military operations
+or acts of terrorism could cause significant disruptions to global commerce. If such disruption results in (i) delays or cancellations
+of customer orders, (ii) a general decrease in consumer spending, (iii) our inability to effectively market and distribute our products,
+or (iv) our inability to access capital markets, our business, results of operations, financial condition and prospects could be materially
+and adversely affected. We cannot predict whether involvement in a war or other military action would result in any long-term business
+disruption or whether such involvement or response would have any long-term material adverse effect on our business, results of operations,
+financial condition or prospects.
+
+ 
+
+(4) The use of social media and influencers
+may have a material adverse effect on our reputation
+
+We sell through various display exhibitions and
+other channels; we promote sales through the private custom model. Each sales channel corresponds to each channel of consumers, which
+also means that we will be subject to the common supervision of all our consumer groups, need to strictly control the quality and products
+to prevent the emergence of bad reviews of us, and at the same time to prevent the malicious smear from the water army of peers, need
+us to have better public relations handling as well as response means.
+
+ 
+
+5) Corporate Social Responsibility
+
+Many factors affect our reputation and brand value,
+including stakeholder perceptions and the industries in which we do business. Our business faces increasing scrutiny related to environmental,
+social and governance activities, and our reputation and brand value could be damaged if we fail to act responsibly or comply with regulatory
+requirements in many areas (such as safety and security, environmental management and sustainability, supply chain management, climate
+change, diversity, human rights, philanthropy and support for local communities).
+
+ 
+
+ 7 
+
+ 
+
+ 
+
+ 
+
+6) Keeping up with the times in production
+and sales processes
+
+Our production methods should face the challenges
+of the new era, whether it is the instruments used for processing, the software used by our designers for design, or even the adoption
+of intelligent voice services on the sales side as needed, all our processes should follow the progress of the times and make changes
+to keep up with the pace of the times, for this reason we do not hesitate to spend resources on researching relevant technologies and
+products, as well as exploring channels with relevant To do so, we spend resources on researching relevant technologies and products,
+as well as exploring channels with relevant products to achieve a more stable production line and sales chain, so as to keep up with the
+development of the times.
+
+ 
+
+7 The
+management process should be more modern
+
+As our enterprise is getting bigger and bigger,
+we are constantly exploring the optimization of the management mode in the process of growth, not only a transition and realization from
+offline management to online management, but also in order to further our goal, our platform will also use the big data of each process
+we have accumulated to train our employees, so that they can make progress in the process of being managed, realize their personal value
+and In order to further our goals, our platform will also use the big data we have accumulated for each process to train our employees,
+so that they can improve in the process of being managed, achieve their personal values and goals, and make our company more efficient.
+
+ 
+
+Implications of Being an Emerging Growth Company
+
+ 
+
+As a company with less than US$1.07 billion
+in revenue for our last fiscal year, we qualify as an emerging growth company pursuant to the Jumpstart Our Business Startups
+Act of 2012, or the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other requirements compared
+to those that are otherwise applicable generally to public companies. These provisions include, but are not limited to:
+
+ 
+
+ being permitted to present only two years of
+audited financial statements and only two years of related Management s Discussion and Analysis of Financial Condition and Results
+of Operations in our SEC filings;
+
+ not being required to comply with the auditor
+attestation requirements of Section 404 of the Sarbanes-Oxley Act;
+
+ reduced disclosure obligations regarding executive
+compensation in periodic reports, proxy statements and registration statements; and
+
+ exemptions from the requirements of holding a
+nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
+
+ 
+
+The JOBS Act also provides
+that an emerging growth company does not need to comply with any new or revised financial accounting standards until such date that a
+private company is otherwise required to comply with such new or revised accounting standards.We have elected to use the extended transition
+period under the JOBS Act. Accordingly, our financial statements may not be comparable to the financial statements of public companies
+that comply with such new or revised accounting standards.
+
+ 
+
+We will remain an emerging
+growth company until the earliest of (a) the last day of the fiscal year during which we have total annual gross revenues of at least
+US$1.07 billion; (b) the last day of our fiscal year following the fifth anniversary of the completion of this offering; (c) the
+date on which we have, during the preceding three-year period, issued more than US$1.0 billion in non-convertible debt; or (d) the
+date on which we are deemed to be a large accelerated filer under the Securities Exchange Act of 1934, as amended, or the
+Exchange Act, which would occur as of the end of our fiscal year if the market value of our Ordinary Shares that are held by non-affiliates
+exceeds US$700 million as of the last business day of our most recently completed second fiscal quarter. Once we cease to be an emerging
+growth company, we will not be entitled to the exemptions provided in the JOBS Act discussed above.
+
+ 
+
+ 8 
+
+ 
+
+ 
+
+ 
+
+The Offerings
+
+ 
+ Issuer
+ Jinrong Holdings Ltd.
+
+ 
+ Securities Being Offered
+ Ordinary Shares (or Ordinary Shares if the underwriters exercise their over-allotment option in full), par value US$0.0001 per share, on a firm commitment basis
+
+ 
+ 
+ 
+
+ 
+ Offering Price
+ We expect that the initial public offering price will be US$5.00 per Ordinary Share.
+
+ 
+ 
+ 
+
+ 
+ Ordinary Shares Outstanding 
+
+Immediately Before This Offering
+ Ordinary Shares
+
+ 
+ 
+ 
+
+ 
+ Ordinary Shares Outstanding 
+
+Immediately After This Offering
+ Ordinary Shares (or Ordinary Shares if the underwriters exercise their option to purchase additional Ordinary Shares in full).
+
+ 
+ 
+ 
+
+ 
+ Voting Rights
+ Each Ordinary Share is entitled to one vote. Ordinary Shares are not convertible.
+
+ 
+ 
+ 
+
+ 
+ Use of Proceeds
+ We intend to use the net proceeds of this offering for (i) purchasing equipment, (ii) further developing our sales system, and (iii) working capital and other general corporate purposes. See Use of Proceeds for additional information.
+
+ 
+ 
+ 
+
+ 
+ Proposed Nasdaq Trading Symbol 
+
+and Listing
+ We plan to apply to list our Ordinary Shares on the Nasdaq Capital Market under the symbol JR This offering is contingent upon us listing our Ordinary Shares on Nasdaq Capital Market or another national exchange. No assurance can be given that such listing will be approved or that a liquid trading market will develop for our Ordinary Shares.
+
+ 
+ 
+ 
+
+ 
+ Lock-up
+ Our directors, executive officers, and shareholder who own 5% or more of the outstanding Ordinary Shares intended agreed with the underwriters not to offer for sale, issue, sell, contract to sell, pledge or otherwise dispose of any of our Ordinary Shares or securities convertible into Ordinary Shares for a period of 6 months commencing on the date of this prospectus. The Company is also prohibited from conducting offerings during this period and from re-pricing or changing the terms of existing options and warrants. See Underwriting for additional information.
+
+ 
+ 
+ 
+
+ 
+ Transfer Agent
+ 
+
+ 
+ 
+ 
+
+ 
+ Risk factors
+ See Risk Factors for a discussion of risks you should carefully consider before investing in our Ordinary Shares.
+
+ 
+ 
+
+Summary of Risks Affecting Our Company
+
+ 
+
+Our business is subject to numerous risks described in the section
+titled Risk Factors and elsewhere in this prospectus. The main risks set forth below and others you should consider are
+discussed more fully in the section entitled Risk Factors , which you should read in its entirety. Among the key risks facing
+our company are:
+
+ 
+
+ 9 
+
+ 
+
+ 
+
+ 
+
+Risks Related to Our Business
+
+ We have grown rapidly in recent years and have limited experience operating at our current scale of operations.
+If we are unable to manage our growth effectively, our brand, company culture and financial results may suffer.
+
+ We have limited sources of working capital and will need substantial additional financing.
+
+ We are dependent on certain key personnel and loss of these key personnel could have a material adverse effect
+on our business, financial condition and results of operations.
+
+ Although we do not own or control our distributors, the actions of these distributors may affect our business
+operations or our reputation in the marketplace.
+
+ Our success depends on our ability to protect our intellectual property.
+
+ If we fail to maintain an effective quality control system, our business could be materially and adversely
+affected.
+
+ The global coronavirus COVID-19 pandemic has caused significant disruptions in our business, which may continue
+to materially and adversely affect our results of operations and financial condition.
+
+ 
+
+Risks Related to Doing Business in China
+
+ A severe or prolonged downturn in the global or Chinese economy could materially and adversely affect our
+business and our financial condition.
+
+ PRC regulation of loans to, and direct investments in, PRC entities by offshore holding companies may delay
+or prevent us from using proceeds from this offering and/or future financing activities to make loans or additional capital contributions
+to our PRC operating entities.
+
+ We must remit the offering proceeds to China before they may be used to benefit our business in China, and
+this process may take several months to complete.
+
+ Changes in China s economic, political, or social conditions or government policies could have a material
+adverse effect on our business and operations.
+
+ Under the Enterprise Income Tax Law, we may be classified as a Resident Enterprise of China.
+Such classification will likely result in unfavorable tax consequences to us and our non-PRC shareholders.
+
+ We may be exposed to liabilities under the Foreign Corrupt Practices Act and Chinese anti-corruption law.
+
+ Uncertainties with respect to the PRC legal system could adversely affect us.
+
+ Recent greater oversight by the CAC over data security, particularly for companies seeking to list on a foreign
+exchange, could adversely impact our business and our proposed offering.
+
+ The Chinese government exerts substantial influence over the manner in which we must conduct our business,
+and may intervene or influence our operations at any time, which could result in a material change in our operations, significantly limit
+or completely hinder our ability to offer or continue to offer securities to investors and, and cause the value of our Ordinary Shares
+to significantly decline or be worthless.
+
+ Increases in labor costs in the PRC may adversely affect our business and results of operations.
+
+ You may face difficulties in protecting your interests and exercising your rights as a shareholder since
+we conduct substantially all of our operations in China, and almost all of our officers and directors reside outside the U.S.
+
+ 
+
+Risks Related to the Offering and Our Ordinary
+Shares
+
+ We do not intend to pay dividends for the foreseeable future.
+
+ There may not be an active, liquid trading market for our Ordinary Shares.
+
+ 
+
+General Risk Factors
+
+ We may not be able to hire and retain qualified personnel to support our growth and if we are unable to retain
+or hire these personnel in the future, our ability to improve our products and implement our business objectives could be adversely affected.
+
+ The initial public offering price of our Ordinary Shares may not be indicative of the market price of our
+Ordinary Shares after this offering. In addition, an active, liquid and orderly trading market for our Ordinary Shares may not develop
+or be maintained, and our stock price may be volatile.
+
+ 
+
+ 10 
+
+ 
+
+ 
+
+ 
+
+ For as long as we are an emerging growth company, we will not be required to comply with certain reporting
+requirements, including those relating to accounting standards and disclosure about our executive compensation, that apply to other public
+companies.
+
+ The requirements of being a public company may strain our resources and divert management s attention.
+
+ We have broad discretion in the use of the net proceeds from our initial public offering and may not use
+them effectively.
+
+ The obligation to disclose information publicly may put us at a disadvantage to competitors that are private
+companies.
+
+ A sale or perceived sale of a substantial number of shares of our Ordinary Shares may cause the price of
+our Ordinary Shares to decline.
+
+ 
+
+Implications of Being a Foreign Private Issuer
+
+ 
+
+We are a foreign private issuer within the meaning
+of the rules under the Securities Exchange Act of 1934, as amended (the Exchange Act ). As such, we are exempt from certain
+provisions applicable to United States domestic public companies. For example:
+
+ 
+
+ we are not required to provide as many Exchange Act reports, or as frequently, as a domestic public company;
+
+ for interim reporting, we are permitted to comply solely with our home country requirements, which are less
+rigorous than the rules that apply to domestic public companies;
+
+ we are not required to provide the same level of disclosure on certain issues, such as executive compensation;
+
+ we are exempt from provisions of Regulation FD aimed at preventing issuers from making selective disclosures
+of material information;
+
+ we are not required to comply with the sections of the Exchange Act regulating the solicitation of proxies,
+consents, or authorizations in respect of a security registered under the Exchange Act; and
+
+ we are not required to comply with Section 16 of the Exchange Act requiring insiders to file public reports
+of their share ownership and trading activities and establishing insider liability for profits realized from any short-swing 
+trading transaction.
+
+ 
+
+Implications of Being a Controlled Company
+
+ 
+
+Controlled companies are exempt from the majority
+of independent director requirements. Controlled companies are subject to an exemption from Nasdaq standards requiring that the board
+of a listed company consist of a majority of independent directors within one year of the listing date.
+
+ 
+
+Public Companies that qualify as a Controlled
+Company with securities listed on the Nasdaq Stock Market (Nasdaq), must comply with the exchange s continued listing
+standards to maintain their listings. Nasdaq has adopted qualitative listing standards. Companies that do not comply with these
+corporate governance requirements may lose their listing status. Under the Nasdaq rules, a controlled company is a company
+with more than 50% of its voting power held by a single person, entity or group. Under Nasdaq rules, a controlled company is exempt from
+certain corporate governance requirements including:
+
+ 
+
+ the requirement that a majority of the board of directors consist of independent directors;
+
+ the requirement that a listed company have a nominating and governance committee that is composed entirely
+of independent directors with a written charter addressing the committee s purpose and responsibilities;
+
+ the requirement that a listed company have a compensation committee that is composed entirely of independent
+directors with a written charter addressing the committee s purpose and responsibilities; and
+
+ the requirement for an annual performance evaluation of the nominating and governance committee and compensation
+committee.
+
+ 
+
+ 11 
+
+ 
+
+ 
+
+ 
+
+Controlled companies must still comply with the
+exchange s other corporate governance standards. These include having an audit committee and the special meetings of independent
+or non-management directors.
+
+ 
+
+Upon the completion of this offering, our Controlling
+Shareholder will beneficially own of our total issued and outstanding Ordinary Shares, representing % of the total voting power, assuming
+that the underwriters do not exercise their over-allotment option, or of our total issued and outstanding Ordinary Shares, representing
+% of the total voting power, assuming that the over-allotment option is exercised in full. As a result, we will be a controlled
+company as defined under Nasdaq Listing Rule 5615(c) because our Controlling Shareholder will hold more than 50% of the voting
+power for the election of directors. As a controlled company, we are permitted to elect not to comply with certain corporate
+governance requirements. We do not plan to rely on these exemptions, but we may elect to do so after we complete this offering.
+
+ 
+
+Corporate Information
+
+ 
+
+Our principal executive offices are located at
+16F, Block K, Vibon Financial Plaza, Dongsheng District, Ordos, Inner Mongolia, People s Republic of China 010300
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CMPOW_composecur_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CMPOW_composecur_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..991564a12ad1d2eb86b1414f7bf08c5111b17127
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CMPOW_composecur_prospectus_summary.txt
@@ -0,0 +1 @@
+This summary highlights selected information appearing elsewhere in this prospectus or the documents incorporated by reference herein. Because it is a summary, it may not contain all of the information that may be important to you. To understand this offering fully, you should read this entire prospectus, the registration statement of which this prospectus is a part and the documents incorporated by reference herein carefully, including the information set forth under the heading Risk Factors and our financial statements. Overview of the Company CompoSecure, Inc. (the Company ) provides its clients innovative and highly differentiated financial payment products in order to support and increase its customer acquisition, customer retention and organic customer spend. The Company s clients consist primarily of leading international and domestic banks and other payment card issuers primarily within the United States ( U.S. ), Europe, Asia, Latin America, Canada, and the Middle East. The Company is a world-class platform for next generation payment technology, security, and Cryptocurrency solutions. For two decades, through its combination of large-scale, advanced manufacturing capabilities and deep technological expertise, the Company has driven key Payments Industry innovations in materials science, Metal Form Factor design, dual interface functionality, and security. The distinct value proposition of the Company s products has resulted in widespread adoption by major banks, financial institutions and leading FinTech innovators to support their acquisition and retention of consumer and business card customers. The Company maintains trusted, highly-embedded and long-term customer relationships with an expanding set of global issuers. These same fundamental strengths are now enabling the Company to enter the Digital Asset revolution through the launch of its Arculus platform, commencing in 2021 with the Arculus KeyTM Card and companion Arculus WalletTM phone application for transaction processing. For more information about the Company, see the sections titled Business and Management s Discussion and Analysis of Financial Condition and Results of Operations. Background Roman DBDR was a blank check company incorporated under the laws of the State of Delaware on August 21, 2020, for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or other similar business combination with one or more businesses. On November 10, 2020, Roman DBDR consummated an initial public offering of 22,000,000 Units (the Roman DBDR Units ), at $10.00 per unit, generating gross proceeds of $220,000,000. Simultaneously with the closing of the initial public offering, Roman DBDR consummated the sale of 10,375,000 private placement warrants to Roman DBDR Tech Sponsor LLC ( Sponsor ) at a price of $1.00 per private placement warrant, generating gross proceeds of $10,375,000. On November 17, 2020, in connection with the underwriters partial exercise of their over-allotment option, Roman DBDR consummated the sale of an additional 1,156,000 Units, at $10.00 per Unit, and the sale of an additional 462,400 private placement warrants, at $1.00 per private placement warrant, generating total gross proceeds of $12,022,400. On December 27, 2021 (the Closing Date ), Roman DBDR consummated a business combination (the Business Combination and the closing of the Business Combination, the Closing ) pursuant to that certain Agreement and Plan of Merger, dated April 19, 2021 (the Original Merger Agreement ), by and among Roman DBDR, Roman Parent Merger Sub, LLC ( Merger Sub ), CompoSecure Holdings, L.L.C. ( Holdings ) and LLR Equity Partners IV, L.P. ( LLR ) as subsequently amended by that certain Amendment No. 1 to the Agreement and Plan of Merger, dated as of May 25, 2021 (the First Amendment and the Original Merger Agreement as amended by the First Amendment, the Merger Agreement ). Holdings is considered the Company s accounting predecessor. On the Closing Date and as contemplated by the Merger Agreement, the Company consummated the Business Combination, whereby Merger Sub merged with and into Holdings, the separate corporate existence of Merger Sub ceased and Holdings became the surviving subsidiary of the Company. At the time the Business Combination became effective pursuant to the terms of the Merger Agreement (the Merger Effective Time ), by virtue of the Merger and without any action on the part of Roman DBDR, Merger Sub, Holdings or the equityholders of Holdings (the Holders ): 1 Table of Contents each unit of limited liability company membership interests in Holdings (the Holdings Units ) issued and outstanding immediately prior to the Merger Effective Time, were, by virtue of the Merger and upon the terms and subject to the conditions set forth in the Merger Agreement, cancelled or converted, as the case may be, and automatically deemed for all purposes to represent the right to receive the applicable portion of the Cash Merger Consideration, the Equity Merger Consideration and the Earnout Consideration (each as defined below), if any, attributable to the Holdings Units as required by Holdings Amended and Restated Limited Liability Company Agreement, dated as of June 11, 2020, and as provided on the Merger Consideration Schedule of the Merger Agreement; the membership interests of Merger Sub issued and outstanding immediately prior to the Merger Effective Time, by virtue of the Merger and without any action on the part of Roman DBDR, Merger Sub or Holdings, converted into and became an amount of newly issued, fully paid and non-assessable Class A Common Units of Holdings equal to the number of shares of Class A Common Stock issued and outstanding immediately following the Merger Effective Time; the number of Class A Common Units of Holdings issued and outstanding equaled the number of shares of Class A Common Stock then issued and outstanding; and the number of Class B Common Units of Holdings issued and outstanding equaled the Class B Common Unit Merger Consideration (as defined below). The aggregate consideration paid to the Holders pursuant to the Merger Agreement was based on an equity value of Holdings of $852,991,200, as adjusted for certain transaction expenses of the Company (the Equity Value ), consisting of: (i) an amount of cash equal to (A) the amount of cash in the Company s Trust Account established for the purpose of holding the net proceeds from its initial public offering and concurrent private placement of warrants, net of any amounts paid to the Company s stockholders that exercise their redemption rights in connection with the Business Combination, plus (B) the proceeds of the Common PIPE Investment and Note PIPE Investment (each as defined below) minus (C) certain transaction expenses (the Cash Merger Consideration ); plus (ii) equity consideration consisting of the Class B Common Units (the Class B Common Unit Merger Consideration ) and Class B Common Stock valued at $10.00 per share (the Class B Common Stock Merger Consideration ) in respect of the remaining portion of Holdings Equity Value after deducting the Cash Merger Consideration (the Equity Merger Consideration ); plus (iii) the Earnout Consideration, if payable. The Holders and the holders of outstanding options to purchase Holdings Units that were not Cashout Options have the right to receive (A) 3,750,000 additional (x) shares of Class A Common Stock with respect to holders of outstanding options to purchase Holdings Units that were not Cashout Options or (y) Class B Common Units (and a corresponding number of shares of Class B Common Stock) with respect to Holders, as applicable, in earn-out consideration in the event the stock price of the Class A Common Stock equals or exceeds $15.00 per share for any 20 trading days within any 30 consecutive trading day period ending on or prior to the three-year anniversary of the Closing, and (B) 3,750,000 additional (x) shares of Class A Common Stock with respect to holders of outstanding options to purchase Holdings Units that were not Cashout Options or (y) Class B Common Units (and a corresponding number of shares of Class B Common Stock) with respect to Holders, as applicable, in earn-out consideration in the event the stock price of the Class A Common Stock equals or exceeds $20.00 per share for any 20 trading days within any 30 consecutive trading day period ending on or prior to the four-year anniversary of the Closing (collectively, the Earnout Consideration ). Holdings Option means each option to purchase Holdings Units that was outstanding under Holdings Amended and Restated Equity Compensation Plan and Cashout Options mean Holdings Options outstanding immediately prior to the Merger Effective Time that were, as of the Merger Effective Time, cancelled pursuant to the Merger Agreement and entitled the holders thereof to receive the cash consideration pursuant to the Merger Agreement. Holders of 18,515,018 Roman DBDR Class A Common Stock elected to have their shares redeemed in connection with the Business Combination. The foregoing description of the Business Combination does not purport to be complete and is qualified in its entirety by the full texts of the Original Merger Agreement and the First Amendment, which are attached hereto as Exhibits 2.1 and 2.2, respectively. At the Closing, certain investors (collectively, the Common PIPE Investors ) pursuant to, and on the terms and subject to the conditions of, those certain subscription agreements (the Common PIPE Subscription Agreements ) dated April 19, 2021, collectively subscribed for 4,500,000 shares of Class A Common Stock at $10.00 per share for aggregate gross proceeds of $45,000,000 (the 2 Table of Contents Common PIPE Investment ). Additionally, at the Closing, certain investors (collectively, the Note PIPE Investors and together with the Common PIPE Investors, the PIPE Investors ) pursuant to, and on the terms and subject to the conditions of, those certain subscription agreements (the Note PIPE Subscription Agreements ) dated April 19, 2021, collectively purchased senior notes issued by Holdings and guaranteed by CompoSecure, L.L.C. in an aggregate principal amount of $130,000,000 (the PIPE Senior Notes ), and such PIPE Senior Notes are exchangeable into shares of Class A Common Stock at a conversion price of $11.50 per share (the Note PIPE Investment and together with the Common PIPE Investment, the PIPE Investments ). Immediately after giving effect to the Business Combination and the PIPE Investments, there were 14,929,982 shares of Class A Common Stock, 61,136,800 shares of Class B Common Stock, and 22,415,400 Warrants outstanding. Of the Warrants outstanding, 11,578,000 are Public Warrants and 10,837,400 are Resale Warrants. The Class A Common Stock and the Public Warrants trade on Nasdaq under the symbols CMPO and CMPOW, respectively. The rights of holders of Class A Common Stock are governed by our Second Amended and Restated Certificate of Incorporation (the Charter ), our Second Amended and Restated Bylaws (the Bylaws ) and the Delaware General Corporation Law (the DGCL ). The rights of holders of Warrants are governed by the Warrant Agreement dated as of November 5, 2020, duly executed and delivered by the Company to Continental Stock Transfer & Trust Company, a New York corporation, as warrant agent. See the section entitled Description of Securities.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CPMV_mosaic_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CPMV_mosaic_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..98842e13c1cc05e89bc2ef0f31f57662366c3c73
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CPMV_mosaic_prospectus_summary.txt
@@ -0,0 +1,26 @@
+PROSPECTUS SUMMARY
+
+ 
+
+Unless the context otherwise requires, references
+to the Company, the combined company, Mosaic, we, our, or us 
+in this prospectus refer to Mosaic ImmunoEngineering Inc. and its subsidiaries (formerly known as Patriot Scientific Corporation). References
+to PTSC refer to Patriot Scientific Corporation prior to the completion of the Reverse Merger (as discussed below) and references
+to Private Mosaic refer to privately held Mosaic ImmunoEngineering Inc. prior to the completion of the Reverse Merger.
+
+ 
+
+The share and per share information in this
+prospectus do not give effect to a contemplated reverse split of our outstanding common stock at a ratio of not less than 1-for-2 and
+not more than 1-for-4. Our Board of Directors has discretionary authority, which has been authorized by our stockholders, to implement
+a reverse split in order to potentially achieve compliance with the initial listing requirements of Nasdaq, if necessary.
+
+ 
+
+This summary highlights certain information
+about us, this offering and information appearing elsewhere in this prospectus. This summary is not complete and does not contain all
+of the information that you should consider before investing in our securities. To fully understand this offering and its consequences
+to you, you should read this entire prospectus carefully, including the information referred to under the heading Risk Factors, 
+ Management s Discussion and Analysis of Financial Condition and Results of Operations and our condensed consolidated
+financial statements and the related notes thereto included elsewhere in this prospectus, before investing. This prospectus includes forward-looking
+statements that involve risks and uncertainties. See
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/CRGY_crescent_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CRGY_crescent_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..1b6df29de56ddeba360d312d090f5de9b665dba0
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CRGY_crescent_prospectus_summary.txt
@@ -0,0 +1 @@
+This summary highlights information included elsewhere in, or incorporated by reference into, this prospectus. This summary does not contain all of the information that you should consider before investing in our Class A Common Stock. You should carefully read the entire prospectus, together with the additional information described under Information Incorporated by Reference, before investing in our Class A Common Stock. The information presented in this prospectus assumes, unless otherwise indicated, that the underwriters option to purchase additional shares of Class A Common Stock is not exercised. References in this prospectus to the selling stockholder refer to the selling stockholder that is offering shares of Class A Common Stock as set forth in the section entitled Selling Stockholder. This prospectus includes certain terms commonly used in the oil and natural gas industry, which are defined elsewhere in this prospectus in the Glossary of Terms contained in Annex A. Unless otherwise indicated, the estimates of our proved, probable and possible reserves as of December 31, 2021 have been prepared or audited, as applicable, by Netherland, Sewell & Associates, Inc. ( NSAI ), Haas Petroleum Engineering Services, Inc., Cawley, Gillespie & Associates, Inc. ( CG&A ) and William M. Cobb & Associates, Inc., our independent reserve engineers (collectively, Independent Reserve Engineers ). Our Company Overview We are a well-capitalized U.S. independent energy company with a portfolio of low-decline assets in proven regions across the lower 48 states that generate substantial cash flow and deliver significant stockholder returns. Our core leadership team is a group of experienced investment, financial and industry professionals who continue to execute on the strategy we have employed since 2011. Our mission is to invest in energy assets and deliver better returns through strong operations and stewardship. We seek to deliver attractive risk-adjusted investment returns and predictable cash flows across cycles by employing our differentiated approach to investing in the oil and gas industry. Our approach employs a unique business model that combines an investor mindset and deep operational expertise to pursue a cash flow-based investment mandate focused on operated working interests with an active risk management strategy. Our Class A Common Stock trades on the NYSE under the symbol CRGY. We pursue our strategy through the production, development and acquisition of oil, natural gas and natural gas liquid ( NGL ) reserves. Our free cash flow-focused portfolio includes a balanced set of oil and natural gas assets in proven onshore U.S. basins with substantial existing production, a low decline rate and an acreage position that is 96% held by production, inclusive of the assets acquired in the Uinta Acquisition. Based on forecasts used in our reserve reports, our PDP reserves as of December 31, 2021 have estimated average five-year and ten-year annual decline rates of approximately 13% and 11%, respectively, and an estimated 2022 PDP decline rate of 22%. The relatively higher decline rate in 2022 is due primarily to the high initial production profiles of certain more recently drilled PDP wells acquired in the Uinta Acquisition, which we expect to decrease over time as wellbore pressure gradually declines and stabilizes. As a result of this overall low decline profile, we require relatively minimal capital expenditures to maintain our production and cash flows while supporting our dividend policy. We have a robust inventory of attractive operated undeveloped locations, providing for optimal flexibility to maintain or grow our production base. Our portfolio is enhanced and complemented by our additional interests in mineral acreage and midstream infrastructure, which provide operational benefits and enhance our cash flow margins. We have built a substantial portfolio of reserves, production, cash flows and reinvestment opportunities. On a pro forma basis after giving effect to the Transactions, our portfolio of assets: at December 31, 2021, consisted of 597.8 net MMBoe of proved reserves, of which approximately 55% were liquids, reflecting: $6.0 billion in net proved standardized measure and $6.2 billion in net proved present value discounted at PV-10 at SEC pricing; and Table of Contents The information in this prospectus is not complete and may be changed. The securities described herein may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities, and it is not soliciting an offer to buy these securities, in any state or jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED SEPTEMBER 6, 2022 5,000,000 Shares Crescent Energy Company Class A Common Stock The selling stockholder identified in this prospectus is offering 5,000,000 shares of our Class A common stock, par value $0.0001 per share ( Class A Common Stock ). We will not receive any of the proceeds from the sale of the shares by the selling stockholder. Our Class A Common Stock is listed on The New York Stock Exchange ( NYSE ) under the symbol CRGY. The last reported sales price of our Class A Common Stock on the NYSE on September 2, 2022 was $16.77 per share. Investing in our Class A Common Stock involves risks. See Risk Factors on page 26. Per Share Total Price to Public $ $ Underwriting Discounts and Commissions(1) $ $ Proceeds to the Selling Stockholder, Before Expenses $ $ (1) See Underwriting (Conflicts of Interest) for additional information regarding underwriting compensation. The selling stockholder has granted the underwriters the option to purchase up to 750,000 additional shares of Class A Common Stock on the same terms and conditions set forth above within 30 days from the date of this prospectus. Delivery of the shares of Class A Common Stock will be made on or about , 2022. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Credit Suisse KKR Wells Fargo Securities J.P. Morgan BofA Securities RBC Capital Markets Truist Securities The date of this prospectus is , 2022. Table of Contents $8.6 billion in net proved present value discounted at PV-10 at NYMEX pricing as of June 30, 2022; during the year ended December 31, 2021, produced 148 net MBoe/d and during the six months ended June 30, 2022, produced 145 net MBoe/d; during the year ended December 31, 2021, generated a $245.2 million net loss, $963.5 million of Adjusted EBITDAX and $665.4 million of Levered Free Cash Flow, and during the six months ended June 30, 2022, generated $25.7 million of net loss, $698.7 million of Adjusted EBITDAX and $357.1 million of Levered Free Cash Flow; and at December 31, 2021 had 1,679 gross (810 net) undrilled locations, including 718 gross (575 net) operated drilling locations. Of our total 810 net locations, 211 net locations are identified as PUD drilling locations. In total, our drilling locations represent an aggregate of over $4.7 billion of reinvestment potential, of which $1.3 billion is attributable to PUD drilling locations in total. For definitions of Adjusted EBITDAX and Levered Free Cash Flow, including reconciliations to the nearest U.S. generally accepted accounting principles ( GAAP ) measure, see Summary Historical Financial Data Non-GAAP Financial Measures. Free cash flow-focused portfolio promotes return of capital to investors We have constructed a liquids-weighted portfolio of long-lived reserves and low decline production that generates substantial cash flow with a robust inventory of attractive undeveloped locations. We believe that the stable nature of our producing assets combined with our hedging strategy and low leverage profile provides us the ability to generate strong free cash flow in a variety of commodity price environments, which positions us to maintain financial strength and consistently return capital to stockholders. Our estimated 2022 PDP decline rate of 22%, based on forecasts used in our reserve reports, is substantially lower than the industry average. The low decline nature of our asset base requires minimal reinvestment to maintain our production, and provides us with significant flexibility to pursue both reinvestment opportunities within our current portfolio, strategic acquisitions and/or return capital to investors. While many of our peers have historically outspent their cash flows, we have averaged a reinvestment rate, which we define as our historical capital expenditures (excluding acquisitions) over a specified period as a percentage of our historical Adjusted EBITDAX for such period, of 40% of Adjusted EBITDAX since 2018. This highlights management s capital discipline and commitment to returning capital to stockholders. Adjusted EBITDAX is a non-GAAP financial measure, as discussed further under Summary Historical Financial Data Non-GAAP Financial Measures. Our fixed within a framework dividend policy is generally set annually and targets distributing 10% of Adjusted EBITDAX. Our dividend is designed to deliver a reliable return of capital to our stockholders and we believe it is more stable than that of our peers as it is not impacted by capital expenditures with Crescent s dividends taking priority to reinvestment decisions and is supported by an active hedging program. Our management team has a long history of paying dividends to stockholders and Independence, our predecessor, paid dividends for nine consecutive years as a private company, through volatile commodity and market conditions and while maintaining a low leverage profile. Low-decline production base underpins free cash flow generation and dividend Based on forecasts used in our reserve reports, our PDP reserves as of December 31, 2021 have estimated average five-year and ten-year annual decline rates of approximately 13% and 11%, respectively, and an estimated 2022 PDP decline rate of 22%. The relatively higher decline rate in 2022 is due primarily to the high initial production profiles of certain more recently drilled PDP wells acquired in the Uinta Acquisition, which we expect to decrease over time as wellbore pressure gradually declines and stabilizes. As a result of this overall low decline profile, we require relatively minimal capital expenditures to maintain our production Table of Contents and cash flows while supporting our dividend policy. Our properties located in the Eagle Ford, Rockies and Barnett represent approximately 80% of our proved reserves as of December 31, 2021, and provide us with diversification from both a regional location and commodity price perspective, which provides us certain downside protection as it relates to commodity-specific pressures, isolated infrastructure constraints or severe weather events. Our net proved standardized measure totaled $6.0 billion as of December 31, 2021. The table below illustrates the aggregate leasehold acreage positions, reserve volumes and weighted average decline profiles associated with our proved assets as of December 31, 2021. Net Acreage Net Proved Reserves (1) % Oil & Liquids (1) Net PD Reserves (1) Weighted Average Annual PDP Decline (2) Net Proved PV-10 (1)(3) Net PD PV-10 (1)(3) Net Proved PV-10 (1)(3) Net PD PV-10 (1)(3) Operating Area Five Year Ten Year SEC (1) NYMEX (6) (M) (MMBoe) (MMBoe) (MM) (MM) (MM) (MM) Eagle Ford 143 136 79 % 84 13 % 11 % $ 1,954 $ 1,307 $ 2,593 $ 1,697 Rockies (4) 243 147 52 % 143 10 % 10 % 1,319 1,250 1,877 1,794 Barnett 133 130 16 % 129 6 % 6 % 605 605 930 930 Permian 107 54 69 % 37 15 % 12 % 594 458 779 611 Other (5) 402 65 68 % 66 13 % 10 % 687 685 912 907 Total excluding Uinta Acquisition 1,028 532 54 % 459 11 % 10 % $ 5,159 $ 4,305 $ 7,091 $ 5,939 Uinta Acquisition 145 66 65 % 40 28 % 21 % 1,054 733 1,551 1,091 Total including Uinta Acquisition 1,174 598 55 % 499 13 % 11 % $ 6,213 $ 5,038 $ 8,642 7,030 (1) Our reserves and present value (discounted at ten percent, or PV-10) were determined using average first-day-of-the-month prices for the prior 12 months in accordance with guidance from the Securities and Exchange Commission ( SEC ). For oil and NGL volumes, the average WTI posted price of $66.56 per barrel as of December 31, 2021, was adjusted for items such as gravity, quality, local conditions, gathering, transportation fees and distance from market. For natural gas volumes, the average Henry Hub Index spot price of $3.598 per MMBtu as of December 31, 2021, was similarly adjusted for items such as quality, local conditions, gathering, transportation fees and distance from market. All prices are held constant throughout the lives of the properties. The average adjusted product prices over the remaining lives of the properties are $64.84 per barrel of oil, $3.46 per Mcf of natural gas and $27.21 per barrel of NGLs. (2) Reflects the estimated annualized decline rates of our PDP reserves as of December 31, 2021 from the monthly period ending January 31, 2022 and the monthly period ending January 31, 2027 for the five-year decline and from the monthly period ending January 31, 2022 and the monthly period ending January 31, 2032 for the ten-year decline, in each case based on the forecasts used in estimating our proved reserves. (3) Reflects the net Proved and PD present values reflected in our proved reserve estimates as of December 31, 2021. PV-10 is not a financial measure prepared in accordance with GAAP. See Summary Reserve and Operating Data for additional discussion. (4) We have a contractual right to participate in 29 thousand net acres in the DJ Basin through an agreement with a large operator and will be entitled to receive our proportionate share of acreage in the future based on our participation in proposed wells. (5) Includes working interest properties located in Mid-Con, California as well as diversified mineral and royalty interests. (6) The NYMEX reserves, PV-0 and PV-10 of Crescent Energy Company and the Uinta Acquisition were determined using index prices for oil and natural gas, respectively, without giving effect to derivative transactions and were calculated based on settlement prices to better reflect the market expectations as of that date, as adjusted for our estimates of quality, transportation fees, and market differentials. The NYMEX reserves calculations are based on NYMEX futures pricing at closing on June 30, 2022 for oil and natural gas. The average adjusted product prices over the remaining lives of the properties are $70.17 per barrel of oil, $4.45 per Mcf of natural gas and $29.40 per barrel of NGLs as of December 31, 2021. We believe that the use of forward prices provides investors with additional useful information about our reserves, as the forward prices are based on the market s forward-looking expectations of oil and natural gas prices as of a certain date, although we caution investors that this information should be viewed as a helpful alternative, not a substitute, for the data presented based on SEC Pricing. See Summary Reserve and Operating Data Summary Reserve Data based on NYMEX Pricing. Table of Contents TABLE OF CONTENTS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/CSLMF_cslm_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/CSLMF_cslm_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..e7258540a1d53edd45206819f60d9e4cfe932b5a
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/CSLMF_cslm_prospectus_summary.txt
@@ -0,0 +1 @@
+This summary only highlights the more detailed information appearing elsewhere in this prospectus. This summary does not contain or purport to contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and articles of association are to our amended and restated memorandum and articles of association to be in effect upon completion of this offering; CIM are to Consilium Investment Management LLC; Companies Act are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; Consilium are to CIM (as defined herein) together with its affiliate entities and funds, excluding the company and sponsor (as defined herein); directors are to our current directors and our director nominees named in this prospectus; Emerging Markets are to (i) those markets/countries not included in the MSCI World Index1 and (ii) Hong Kong; extension deposit are to a deposit by the sponsor into the trust account, in an amount equal to $0.10 per public share (a total of $1,500,000, or $1,725,000 if the underwriters over-allotment option is exercised in full); extension options are to the option of the sponsor, upon completion of an extension deposit, to cause us to extend the available time to consummate our initial business combination by three months. The sponsor may exercise the extension option up to two times, allowing for up to an additional six months (for a total of 24 months) to complete a business combination; founder shares are to our Class B ordinary shares initially purchased by our sponsor in a private placement prior to this offering and our Class A ordinary shares that will be issued upon the conversion thereof as provided herein; Frontier Growth Markets are to those countries included in the MSCI Frontier Markets Index3 or the MSCI Frontier Emerging Markets Index2; initial shareholders are to our sponsor and the other holders of our founder shares prior to this offering (if any); letter agreement are to the letter agreement, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team are to our officers; ____________ 1 The MSCI World Index includes Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, the UK and the US. 2 The MSCI Frontier Markets Index includes Bahrain, Bangladesh, Burkina Faso, Benin, Croatia, Estonia, Guinea-Bissau and Iceland. 3 The MSCI Frontier Emerging Markets Index includes Argentina, Bahrain, Bangladesh, Burkina Faso, Benin, Colombia, Croatia, Estonia, Egypt, Guinea-Bissau, Iceland, Ivory Coast, Jordan, Kenya, Kazakhstan, Lithuania, Mauritius, Mali, Morocco, Niger, Nigeria, Oman, Peru, Philippines, Pakistan, Romania, Serbia, Senegal, Slovenia, Sri Lanka, Togo, Tunisia and Vietnam. 1 Table of Contents ordinary resolution are to a resolution adopted by the affirmative vote of at least a majority of the votes cast by the holders of the issued shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private placement warrants are to the warrants issued to our sponsor in a private placement simultaneously with the closing of this offering; public shareholders are to the holders of our public shares, including our sponsor, directors and officers to the extent our sponsor, directors or officers purchase public shares, provided their status as a public shareholder shall only exist with respect to such public shares; public shares are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); rights or public rights refer to the rights which are being sold as part of the units in this offering; special resolution are to a resolution adopted by the affirmative vote of at least a two-thirds ( ) majority (or such higher threshold as specified in the company s amended and restated articles of association) of the votes cast by the holders of the issued shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter; sponsor are to Consilium Acquisition Sponsor I LLC, a Cayman Islands limited liability company; warrants are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); we, us, our or our company are to Consilium Acquisition Corp I, Ltd., a Cayman Islands exempted company; and $, US$ and U.S. dollar each refer to the United States dollar. All references in this prospectus to shares of the company being forfeited shall take effect as surrenders for no consideration of such shares as a matter of Cayman Islands law. All references to the conversion of our Class B ordinary shares shall take effect as a redemption of such Class B ordinary shares and issuance of the corresponding Class A ordinary shares as a matter of Cayman Islands law. Any share dividends described in this prospectus shall take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option and the forfeiture by our sponsor of 562,500 founder shares. General We are a newly incorporated blank check company formed as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. We have not identified any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. Our efforts to identify a potential initial business combination target will focus on companies operating in the new economy sectors , which we broadly define as those in technology, financial services, or media and that are located in Frontier Growth Markets (as defined herein). While we may pursue an initial business combination opportunity in any country or sector, we intend to capitalize on our management team s and board s decades of experience to identify, acquire and manage a business or businesses that we believe can benefit from their long-established relationships and expertise of having operated a successful investment management business in these regions. Our management team and board have extensive experience in identifying and executing investments at the global scale successfully across a number of sectors, and countries less followed by traditional investment managers. 2 Table of Contents Our sponsor is Consilium Acquisition Sponsor I LLC, an affiliate of CIM, an SEC-registered investment management firm headquartered in Fort Lauderdale, Florida. Given our affiliation with CIM, we intend to capitalize on its global platform and investment expertise which we believe, together with the extensive experience of our management team, well positions our company to be the partner of choice for quality Frontier Growth companies seeking public sponsorship. Consilium Investment Management LLC Established in 2004, Consilium Investment Management has a long track record of successfully investing in Frontier Growth Markets and has been a top-quartile performer since the inception of its Frontier Equity Fund in 2009. CIM has a deeply knowledgeable investment team across Frontier Growth Markets with nearly 144 years of combined experience. Its entrepreneurial, cross-collaborative approach enables the team to act with speed and certainty across a wide range of geographies. CIM s objective across all its investment activities is to deliver attractive risk-adjusted returns to investors on a consistent basis. Over the years, CIM has targeted regions and countries with stable monetary and political systems, two ingredients which we believe are essential foundations for economic growth. These, combined with company-specific drivers, are the cornerstones of CIM s process of finding quality growth companies. In particular, we expect outsized growth in the new economy sectors across these regions, driven by private sector expansion, technological innovation, a growing young and middle-class population, increasing consumption, structural economic and policy reforms and demographic changes. CIM manages two products targeted at Frontier Growth Markets. The Consilium Frontier Equity Fund, LP (the Fund ) focuses on listed equities opportunities within Frontier Growth Markets. The Consilium Extended Opportunities Fund, LP ( EOF ) focuses on less liquid opportunities within Frontier Growth Markets, and targets a three-year time horizon to extract value from companies that are relatively unknown. EOF and Consilium Investment Capital, Inc., a Florida corporation and parent of CIM and parent of the Fund s general partner ( CIC ), are the members of the Sponsor. The founders of CIM have over six decades of experience in Emerging Markets and Frontier Growth Markets. They have deep relationships with companies, management teams, policy makers, and advisors in the space. CIM and its founders have participated in private equity and mezzanine financing transactions and will rely on their broad network in Frontier Growth Markets in order to identify target acquisitions that have the desire to list in the United States and have the infrastructure necessary to comply with US regulatory requirements. Management Team We believe that our management team is well-positioned to take advantage of the growing set of acquisition opportunities within Frontier Growth Markets and that our local and global contacts and relationships, ranging from industry executives, private and public business owners and private equity professionals to our extensive network of trusted advisors and consultants across various sectors, will allow us to generate an attractive transaction for our shareholders. In addition, our management team has an established track record in accessing proprietary M&A opportunities among entrepreneurs and family-owned global businesses. Jonathan Binder, Chairman, is the co-Founder of CIM and Chief Investment Officer and Portfolio Manager for CIM s Frontier Equity and Extended Opportunities Fund Strategies. Prior to co-founding Consilium, Mr. Binder spent four years at Standard Asset Management, a division of the Standard Bank Group of South Africa, as Chief Investment Officer. Mr. Binder had previously spent two years at Americas Trust Bank where he was an Emerging Market equity hedge fund portfolio manager. Prior to this, Mr. Binder was Managing Director of Latin American Equity Capital Markets at Deutsche Morgan Grenfell and before that, launched James Capel s equity sales trading and research business in Latin America. He graduated from the University of Bristol, England, with a B.Sc. (Econ) joint honors degree in Economics and Politics. Mr. Binder is an alumnus of Eton College. Charles Cassel, Chief Executive Officer and Chief Financial Officer, is the co-Founder and Chief Executive Officer of CIM. Mr. Cassel is responsible for the risk management for CIM s investment strategies, the day-to-day operations of CIM and all non-equity portfolio management initiatives, and also serves as the Chief Compliance Officer. Before co-founding Consilium, Mr. Cassel held the position as Head of Emerging Markets Portfolio Management at Standard Asset Management. Prior to that, Mr. Cassel was at Americas Trust Bank as an Emerging 3 Table of Contents Market debt portfolio manager and was earlier the Chief Financial Officer for the US subsidiary of Banco Cafetero de Colombia, where, among other responsibilities, he ran the bank s international treasury book. Earlier, he was a Portfolio Manager of mortgage-backed securities at Bank Atlantic, a federally chartered savings bank. From 2014 to 2017, Mr. Cassel served as a director of Panache Beverages, Inc. Mr. Cassel holds a B.A. in Economics from Washington & Lee University and a M.Acc. in Accounting from Nova Southeastern University. Additionally, he is a CFA charter holder and a member of the CFA Institute. Faisal Ghori, Chief Operating Officer, is Director of Research of CIM. Prior to joining CIM, Mr. Ghori was a senior investment professional at Wasatch Global Investors where he invested across Emerging Markets and Frontier Growth Markets. He was a senior investment professional at Aldrich Capital Partners (previously known as Tipton Equity), a growth equity firm focused on high-growth technology companies. Earlier, he was an investment professional at Ashmore (previously known as Emerging Markets Management), a specialist Emerging Markets investment manager where he led investments across Frontier Growth Markets. He began his career as a technology investment banker at Merrill Lynch. Mr. Ghori received a BA from the University of California, Berkeley, and an MBA from the Kellogg School of Management, Northwestern University. He has additionally completed graduate coursework at the School of Foreign Service, Georgetown University. He is a term member of the Council on Foreign Relations. Independent Board Irakli Gilauri is the Chief Executive Officer and Chairman of Georgia Capital. Irakli Gilauri formerly served as the Chief Executive Officer of BGEO Group from 2011 to May 2018. He joined as CFO of Bank of Georgia in 2004 and was appointed as Chairman of the Bank in September 2015, having previously served as Chief Executive Officer of the Bank since May 2006. Prior to that time, he was an EBRD (European Bank for Reconstruction and Development) banker. Mr Gilauri has up to 20 years of experience in banking, investment and finance. He served as Director of Georgia Healthcare Group PLC (now Georgia Healthcare Group Limited) from August 2015. Mr. Gilauri also sits on the Supervisory Board of JSC Georgia Capital. Mr. Gilauri received his undergraduate degree in Business Studies, Economics and Finance from the University of Limerick, Ireland, in 1998. He was later awarded the Chevening Scholarship, granted by the British Council, to study at the Cass Business School of City University, London, where he obtained his MSc in Banking and International Finance. Peter Tropper has been the Managing Member of Peter Tropper LLC since February 2014. He was a Senior Advisor to the Global Private Capital Association (previously known as the Emerging Markets Private Equity Association) and chair of the Frontier Markets Council. He has been appointed to numerous private equity fund advisor committees, and is a lecturer at the Wharton School, University of Pennsylvania. Previously, he was the Chief Investment Officer in IFC s Private Equity Group. In this role, Mr. Tropper ran IFC s program for funds that invest in small and medium enterprises and frontier markets. Prior to 2001, he was the HQ anchor for the supervision work of IFC s South Asia Department. Until September 1999, Mr. Tropper served in IFC s Latin America and Caribbean Department, where he was responsible for identifying and structuring IFC s investments in the financial sector in the Caribbean and Chile, and for recommending investment strategies that contribute to the development of the region s capital markets. Mr. Tropper also served as the first head of IFC s Emerging Markets Data Base unit, which has since been sold to Standard & Poor s. Mr. Tropper joined IFC in 1984, after several years as Deputy Director of the Northeast- Midwest Institute in Washington, D.C. Mr. Tropper has a B.A. from Yale University, an MBA from the University of Maryland, and a Master s in International Affairs from the Johns Hopkins University School of Advanced International Studies (SAIS). Salman Alam is Vice President, Legal, at Western Digital Corporation, a leading provider of data storage technologies, where he has been responsible for worldwide product development and go-to-market technology legal issues since 2016. With nearly 15 years of legal experience in the corporate legal sector, he also serves as a principal counsel for the flash technology and consumer products business unit, dealing with emerging product regulatory issues within the data ecosystem in markets across the world, including South Asia and the ASEAN region, where he has significant cross-border transactional experience. Mr. Alam also previously served in roles of increasing responsibility at Western Digital, including Sr. Director, Assistant General Counsel, from 2016 to 2021, Director, Associate General Counsel from 2015 to 2016, Director, Senior Legal Counsel from 2013 to 2015, and Senior Counsel from 2013 to 2013. Prior to Western Digital, Mr. Alam has served as a legal executive to technology startups focused on mobile, web, and advertising business models, as well as a corporate transactional attorney at 4 Table of Contents Newmeyer & Dillion, LLP, where he represented emerging and established companies in corporate transactions, M&A, capital markets, and corporate governance matters. Mr. Alam received a B.A. from the University of California, Berkeley, with two majors in South & Southeast Asian Studies (high honors) and Economics, and minors in Business Administration (Haas School of Business) and Philosophy, respectively. He also received a law degree from the University of California, Hastings. He has additionally completed coursework in the executive education program at Columbia Business School. The past performance of our sponsor and directors and officers and their respective affiliates, including CIM and any funds, is not a guarantee either (1) that we will be able to identify a suitable candidate for our initial business combination or (2) of success with respect to any business combination we may consummate. You should not rely on the historical record of members of our management team or our sponsor group or their respective affiliates, our Independent Board, or any related investment s performance, as indicative of our future performance of an investment in the company or the returns the company will, or is likely to, generate going forward. Market Opportunity While we may pursue an acquisition or a business combination target in any business, industry or geography, we intend to focus our search on a target with business operations or prospective operations in the technology, digital media, e-commerce, financial technology, or digital services sectors, which we refer to as the new economy sectors , across Frontier Growth Markets, located in the following regions: the Middle East North Africa ( MENA ), Sub-Saharan Africa ( SSA ), South Asia ( SA ) and Southeast Asia ( SEA ). We believe this growth in these new economy sectors across Frontier Growth Markets will be driven by private sector expansion, technological innovation, a growing young and middle class population, increasing consumption, structural economic and policy reforms and demographic changes in the region. We believe that Frontier Growth Markets are entering a new era of economic growth, particularly in the new economy sectors, which we expect will result in attractive initial business combination opportunities for attractive risk-adjusted returns. These markets are host to a fast growing population of over 4 billion people, real GDP of approximately $11 trillion as of 2020, a proportion of young people with access to internet economy ecosystems and growing rapidly, often by executing business models that are already proven in more developed markets (delivery and logistics apps, e-commerce and social commerce, media streaming, mobile wallets, etc.), and in other instances innovative, tailored solutions addressing specific market needs (alternative finance, mobile payments). We believe that the largest global companies are often unable to localize their products and services to be compelling (e.g. cash on delivery to address low credit card penetration in some markets). Middle East North Africa: we believe relatively higher incomes (especially in the Gulf Cooperation Council ( GCC ) countries) and internet access with very low but fast-growing e-commerce penetration (e-commerce as a % of total retail sales in 2017 was around 3.0% in the GCC as compared with almost 15.6% and 12.3% in the UK and US respectively) are creating opportunities in e-commerce, delivery services, classifieds and internet infrastructure. Sub-Saharan Africa: In SSA, owing to a significant unbanked population, card and digital payments remain low. This has led to significant growth in mobile wallets, alternative lenders and payments, and remittance businesses that we believe represent attractive potential opportunities for us. South Asia (excluding India): With a population of nearly 400 million across Pakistan and Bangladesh, with nearly half under the age of 25, rapidly rising per capita incomes and urbanization levels, we believe South Asia is a very attractive market for technology and technology enabled businesses in sectors such as e-commerce, ed-tech and food-tech. We believe high mobile penetration rates in South Asia have created opportunities for digital finance services such as mobile wallets, consumer finance and mobile payments for a population that is largely unbanked and underbanked as well as digital media services like streaming and gaming South East Asia: SEA represents relatively more mature markets with higher income levels and more developed infrastructure as compared to MENA, SSA and SA, including higher e-commerce spending and significant time spent online by the high proportion of young population. This has led to an explosion of new media and gaming companies alongside more mature e-commerce, internet infrastructure, classifieds and other specialized players. 5 Table of Contents Middle East and North Africa With a population of 465 million and a nominal GDP of approximately $3.43 trillion in 2020, MENA includes Morocco, Algeria, Tunisia, Libya and Egypt in North Africa. It also includes the GCC countries, comprised of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE, Iraq, and the Levantine nations of Syria, Lebanon, and Jordan. Collective findings by Google and Bain & Company indicate that e-commerce as of 2017 had reached $8.3 billion in MENA, and has been growing ahead of the global average at a rate of 25% per annum. The GCC and Egypt account for nearly 80% of the e-commerce market, and grew even faster at a 30% annual growth rate from 2014 to 2017. Despite this fast clip of growth, Bain estimates that e-commerce penetration of total retail sales was 1.9% in 2017. The fastest growing e-commerce category from 2016 to 2019 was grocery, which grew by more than 250%, and yet despite its growth it remains the least penetrated with less than 1% of total category sales. Some GCC countries are ahead on metrics such as internet, smartphone, and social media penetration compared to both the US and China. Given low penetration, and faster growth, Google and Bain estimate that MENA has the potential to grow by 3.5x by 2022 and reach a market size of $28.5 billion, with a share of total retail sales reaching 8%. We believe the growth of e-commerce in MENA has further shed light on the necessity of hard and soft infrastructure to support its growth. In particular, cash on delivery is today nearly 62% of all e-commerce sales in MENA. MasterCard finds that post-COVID consumers in MENA are 95% more likely to consider using an emerging payment method including cryptocurrency, biometrics, contactless or QR codes in the future. We believe there are opportunities for companies to address payments, logistics, and deliveries. For these reasons, we believe there are significant market opportunities in these segments. Sub-Saharan Africa With a population of 1.3 billion, and a nominal GDP of approximately $2.6 trillion in 2021, we believe Africa will be a major future economic source and a driver of global growth. Over the last decade GDP grew by 4% per year between 2010 and 19, more than twice that of the EU-28 (1.7%), and Latin America (1.7%) over the same period. We believe African demographics are arguably the best in the world, with population growth to grow by 87% between 2019 and 2050 and reach 2.5 billion. By 2025, 45% of all Africans will be urbanized. As of 2020, consumers in Africa s large metropolitan areas spent 79% more than national averages on goods and services. In particular, collective findings by Google and the IFC indicate that the region s internet economy has the potential to contribute $180 billion to Africa s economy by 2025, and estimates that Africa s internet gross domestic product may rise to $712 billion by 2050. Despite the setback from COVID-19, we believe the resilience of the internet economy, coupled with private consumption, strong developer talent, public and private investment, investments in digital infrastructure, and new government policies and regulations will continue to drive this growth in Africa. In 2019, the number of people across the continent with internet access has grown to 522.8 million, or approximately 40% of the population. Over the next decade, internet users in Africa are expected to grow by 11%, comprising 16% of global internet users. Google and the IFC estimate a 10% increase in mobile internet penetration increases GDP per capita by 2.5% in Africa, compared to 2% globally. Moreover, Africa has a significant developer talent base with nearly 700,000 professional developers today. This has not gone unnoticed by global investors who deployed approximately $1.4 billion in funding to the continent in 2020. The continent continues to make capital investments in its internet infrastructure, with bandwidth increased by a factor of 10x over the last decade to 12 terabits per second. Technology companies continue to invest in Africa, with Google s new submarine cable, Equiano, expected to be complete in 2022 which is expected to have 20x the capacity of the last cable built to serve the region. South Asia With a population of 385 million and a nominal GDP of over $580 billion as of 2020, the economies of Pakistan and Bangladesh have sizable populations and have demonstrated fast economic growth. In particular, Bangladesh has grown its GDP in excess of 7% per annum since 2016. 6 Table of Contents Smartphone penetration in Pakistan has grown to nearly 98 million subscribers, or 6.5 times since 2013 as shown by the Pakistan Telecom Authority. Bangladesh has over 40% smartphone penetration. Since its beginning in 2019, the information and communications sector in Bangladesh has growth at a rate of 40% per year. According to the Oxford Internet Institute, Bangladesh is the second-largest supplier of online labor with 650,000 registered freelancers as of 2017. New economy companies are rapidly changing the makeup of regional economies. According to GSMA Intelligence, in 2018 the mobile ecosystem contributed nearly 5.4% of GDP or $16.7 billion to Pakistan s economy. GSMA further estimates that by 2023, the contribution of mobile will account for 6.6% of GDP and reach $24 billion. In 2015, according to the GSMA, the mobile sector contributed to 6.2% of Bangladesh s GDP and reached $12.7 billion. As mobile adoption in both countries switches from 3G and 4G to 5G, we believe there will be tremendous opportunities as the share of people online grows. In particular, we believe South Asia presents tremendous market opportunities for new economy companies. Southeast Asia With a population of 667 million and a nominal GDP of approximately $3 trillion in 2020, we believe the Association of Southeast Asian Nations, or ASEAN, made up of countries in Southeast Asia including Indonesia, Thailand, Singapore, Vietnam, the Philippines, Malaysia, Brunei Darussalam, Myanmar, Cambodia and Laos) will become a major regional economic force and a driver of global growth. ASEAN remains one of the fastest growing regions in the world with economic growth continuing to average 5.4% per annum and according to estimates by ASEAN, and will become the fourth-largest economy in the world by 2030 after the United States, China, and the European Union. In particular, collective findings by Google, Temasek (an active global investment company owned by the Government of Singapore) and Bain & Company indicate that the region s internet economy crossed the $100 billion mark in 2019 and is on track to triple to an estimated $300 billion by 2025. With approximately 400 million internet users in the region, of which nearly half connect to the internet primarily through their mobile phones, Southeast Asia boasts one of the most engaged mobile internet audiences in the world. In addition, with an estimated 150 million people who will be turning 15 years old over the next 15 years, Indonesia and Vietnam lead the region with an estimated over 40% year-over-year growth in internet economies, while Malaysia, Thailand, Singapore and the Philippines are growing by an estimated 20-30% annually. By the end of 2020, the number of digital consumers in Southeast Asia is estimated to reach approximately 310 million, which is nearly 70% of Southeast Asian consumers. Gross merchandise value (GMV) of Internet economies reached an estimated 3.7% of the Southeast Asian GDP in 2019 and is expected to exceed 8% by 2025. In addition, we believe the Southeast Asian region presents market opportunities in the financial sector. According to an Asian Development Bank report on financial inclusion in Southeast Asia, the gap between needs of the populace and the volume of electronic payment and transfer volumes is estimated to be more than $180 billion in Indonesia, Philippines, Cambodia and Myanmar combined. In the same set of countries, there is an estimated gap between savings capacity and savings in formal financial institutions of more than $80 billion, and the credit needs fulfilled by informal lenders is estimated to be approximately $80 billion. There is also low insurance penetration in these markets. For these reasons, we believe that there are significant market opportunities in these segments. We also believe that there are not many funding sources for middle and late-stage fundraising in the Southeast Asian consumer internet space, which we believe provides potential opportunities. Our Business Strategy Our business strategy consists of identifying and completing a business combination with one or more businesses or entities within Frontier Growth Markets, underpinned by an ESG mandate to create long-term value for our shareholders. We believe our management team and directors experience and local contacts are differentiated and will enable us to successfully identify and execute an initial business combination. We plan to leverage CIM and our management team and directors extensive network of relationships, ranging from senior management teams at public and private companies and advisors with connections to Frontier Growth Markets, to assist in the sourcing of potential targets for our initial business combination. 7 Table of Contents We believe our team s strong network and differentiated expertise will help us execute on our business strategy: Local knowledge and connections: Our management team has more than 85 years of combined experience investing in Frontier Growth Markets. At various times some members of our management team have lived and worked in certain markets we are targeting, which has enabled them to create professional and social networks. These relationships span the financial, corporate, legal, and political sectors. We believe their relationships and local knowledge will give our company credibility with businesses within Frontier Growth Markets and help aid in thorough company vetting and due diligence processes. Global platform and resources: Our management team will leverage CIM s international investment platform to help identify, evaluate and perform comprehensive due diligence on companies in connection with the business combination. In addition, Consilium s network of portfolio companies and advisors may be able to help a potential target expand and grow within Frontier Growth Markets. Experience with complex and unique situations: Our team has experience executing complex transactions and navigating complicated regulatory environments. We believe this expertise will enable our management team to structure and execute an attractive cross-border transaction. We expect to be a long-term partner to the post-merger entity and to work together with the management team to assist in the transition to a U.S.-listed company and drive long-term growth. We believe our global investment platform, deep local relationships within Frontier Growth Markets, and commitment to ESG initiatives differentiate us as a value-add partner for a leading Frontier Growth Markets company. Focus on ESG investing: CIM is a signatory to the UN Principles of Responsible Investing, the Intentional Endowments Network, and a member of the Emerging Market Investors Alliance, an industry group for responsible investing in Emerging Markets. Our management will be guided by ESG principles when evaluating potential targets and will seek to enhance them in the chosen company. Our Investment Criteria Consistent with our strategy, we have identified the following characteristics and guidelines that we believe are important in evaluating potential target businesses or entities. We intend to use these criteria and guidelines in assessing acquisition opportunities, but we may decide to enter into our initial business combination with one or more businesses or entities that does not meet these criteria and guidelines. We intend to pursue an initial business combination with companies that have the following attributes: Operations in the new economy sectors across our target markets. We believe that disruptive new economy companies benefit from highly favorable macroeconomic trends in our target markets. These trends are in their infancy, and we believe they have headroom for expansion and growth which makes investing in these sectors attractive. Established business models. Most of our target businesses will have models that we believe are well established in their home and core markets with relevant localization by market and established paths to profitable growth. In addition, we will seek a business that we believe has a sustainable competitive advantage as a result of differentiated de-risked business model, strong technology component, brand recognition and marketing capabilities or any other characteristics that are difficult to replicate. 8 Table of Contents Sector leading KPIs and unit economics. We will seek to merge with a company with critical mass that enjoys sustainable unit economics in its sector. We believe that healthy growth must be supported by strong sector KPIs steering the company in the right direction to drive profitability and free cash flow generation. Scalability. We seek to invest in a business with a scalable platform and operations to take advantage of growth opportunities, including through geographical expansion and synergistic acquisitions. We intend to leverage our experience in scaling businesses in order to help accelerate growth. Underpenetrated and growing total addressable market. Based on our prior research and personal experience, we believe Frontier Growth Markets present a significant opportunity to invest in companies which serve an underpenetrated total addressable market. These countries hold significant potential due to their geographical size, favorable population trends and the emergence of a middle-class in certain countries. Strong management team and culture. We will look to partner with a passionate, experienced management team that is capable of scaling a business. We will also evaluate ways to support the team in its transition to becoming a U.S.-listed company and beyond. Market leadership. We will seek to combine with a company with a leading position in its geography, market share, volume, technology, product capabilities, or other attributes across an industry or segment, significant barriers to entry and a sustainable competitive advantage. Attractive valuation. We believe that valuations of some companies in Frontier Growth Markets are discounted relative to U.S. peers. We look to seek an acquisition of a company that has potential to grow valuation levels in line with its global peers. Focus on ESG and social empowerment. We will look for companies focused on making a positive impact across a variety of ESG themes within Frontier Growth Markets, as well as on a larger scale. Our Acquisition Process We have not selected any business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. Our sponsor and directors and officers are, or may in the future become, affiliated with entities that are engaged in a business similar to ours. These entities may compete with us for acquisition opportunities. If these entities decide to pursue any such opportunity, we may be precluded from pursuing such opportunities. Subject to his or her fiduciary duties under Cayman Islands law, none of the members of our management team have any obligation to present us with any opportunity for a potential business combination of which they become aware. Our management team, in their capacities as directors, officers or employees of our sponsor or its affiliates or in their other endeavors (including other special purpose acquisition companies), may choose to present potential business combinations to the related entities described above, current or future entities affiliated with or managed by our sponsor, or third parties, before they present such opportunities to us, subject to his or her fiduciary duties under Cayman Islands law and any other applicable fiduciary duties. Our directors and officers presently have, and any of them in the future may have, additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity. Accordingly, if any of our directors or officers becomes aware of a business combination opportunity that is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she may need to honor these fiduciary or contractual obligations to present such business combination opportunity to such entity, or in the case of a non-compete restriction, may not present such opportunity to us at all, subject to his or her fiduciary duties under Cayman Islands law. Our directors and officers are also not required to commit any specified amount of time to our affairs, and, accordingly, will have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. 9 Table of Contents For example, Mr. Binder is the co-Founder of CIM and Chief Investment Officer and Portfolio Manager for CIM, Mr. Cassel is the is the co-Founder and Chief Executive Officer of CIM, Mr. Ghori is a Managing Director and Director of Research of CIM. CIM is an SEC-registered investment management firm, and each of Mr. Binder, Mr. Cassel and Mr. Ghori owes fiduciary duties to CIM. Our sponsor and directors and officers are also not prohibited from sponsoring, investing or otherwise becoming involved with, any other blank check companies, including in connection with their initial business combinations, prior to us completing our initial business combination. Any other special purpose acquisition company may also have terms that are the same or different than our terms, including terms that are more favorable to its investors and/or potential target businesses. Moreover, entities in which our directors and officers are affiliated with may enter into agreements or other arrangements with businesses, which agreements or arrangements may limit or restrict our ability to enter into a business combination with such business. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and us, on the other. In addition our amended and restated articles of association will contain provisions to exculpate and indemnify, to the maximum extent permitted by law, such persons in respect of any liability, obligation or duty to the company that may arise as a consequence of such persons becoming aware of any business opportunity or failing to present such business opportunity. We do not believe, however, that the fiduciary duties or contractual obligations of our directors or officers will materially affect our ability to identify and pursue business combination opportunities or complete our initial business combination. See Risk Factors Risks Related to our Team and Their Respective Affiliates and to the Post-Business Combination Company Certain of our directors and officers are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented. Our sponsor is managed by CIC, which is owned by Mr. Cassel and Mr. Binder. In addition, our sponsor is owned by Consilium affiliates. As a result, Mr. Cassel and Mr. Binder and the Consilium affiliates may exert a substantial influence on other actions requiring a shareholder vote, potentially in a manner that you do not support, including appointment of our directors, amendments to our amended and restated memorandum and articles of association and approval of major corporate transactions. If our sponsor purchases any Class A ordinary shares in this offering or in the aftermarket or in privately negotiated transactions, this would increase their influence over such actions. See Risk Factors Risks Related to our Team and Their Respective Affiliates and to the Post-Business Combination Company Our sponsor is managed by CIC, which is owned by Charles Cassel III and Jonathan Binder, who serve on our board of directors and as our Chief Executive Officer and Chief Financial Officer and our Chairman, respectively, and is owned by entities controlled by them and associated with Consilium (the Consilium affiliates ). As a result, Mr. Cassel, Mr. Binder and the Consilium affiliates may exert a substantial influence on actions requiring shareholder vote, potentially in a manner that you do not support, and their interests may differ from your interests. We do not believe, however, that the duties and obligations of the Consilium affiliates will materially affect our ability to identify and pursue business combination opportunities or complete our initial business combination. Consilium may become aware of a potential business combination opportunity that may be an attractive opportunity for our company. Consilium and our company may each assess opportunities within Frontier Growth Markets. In particular, CIM manages two products targeted at Frontier Growth Markets. The Fund focuses on listed equities opportunities within Frontier Growth Markets. EOF focuses on less liquid opportunities within Frontier Growth Markets, and targets a three-year time horizon to extract value from companies that are relatively unknown. Consilium is not under any obligation to source any potential opportunities for our initial business combination or refer any such opportunities to our company or provide any other services to our company. Consilium s role with respect to our company is expected to be primarily passive and advisory in nature. Consilium may have fiduciary and/or contractual duties to its investment vehicles and to companies in which Consilium has invested. As a result, Consilium may have a duty to offer business combination opportunities to certain Consilium funds, other investment 10 Table of Contents vehicles or other entities before other parties, including our company. Additionally, certain companies in which Consilium has invested may enter into transactions with, provide goods or services to, or receive goods or services from an entity with which we seek to complete our initial business combination. Transactions of these types may present a conflict of interest because Consilium may directly or indirectly receive a financial benefit as a result of such transaction. We believe that any such potential conflicts of interest of Consilium will be naturally mitigated by the differing nature of targets that Consilium typically considers most attractive for its activities and the types of initial business combination opportunities that we expect to be most attractive for our company. Past experience or performance of our team and their respective affiliates is not a guarantee of either (1) our ability to successfully identify and execute a transaction or (2) success with respect to any business combination that we may consummate. You should not rely on the historical record of our team or their respective affiliates as indicative of future performance. See Risk Factor Past performance of Consilium, our team and their respective affiliates may not be indicative of future performance of an investment in the company. No member of our management team has any experience operating a special purpose acquisition company. Initial Business Combination The Nasdaq listing rules require that our initial business combination must be with one or more operating businesses or assets with a fair market value equal to at least 80% of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the income earned on the trust account) at the time of the agreement to enter into our initial business combination. We refer to this as the 80% of fair market value test. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. Unless we complete our initial business combination with an affiliated entity, we are not required to obtain an opinion that the price we are paying is fair to our company from a financial point of view. We do not currently intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination, although there is no assurance that will be the case. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the issued and outstanding equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our initial business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the issued and outstanding capital stock, shares or other equity securities of a target business or issue a substantial number of new shares to third parties in connection with financing our initial business combination. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of fair market value test. If our initial business combination involves more than one target business, the 80% of fair market value test will be based on the aggregate value of all of the target businesses. Notwithstanding the foregoing, if we are not then listed on Nasdaq for whatever reason, we would no longer be required to meet the foregoing 80% of fair market value test. 11 Table of Contents Prior to the effectiveness of the registration statement of which this prospectus forms a part, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended (the Exchange Act ). As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. Corporate Information We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our ordinary shares that is held by non-affiliates equals or exceeds $700 million as of the end of that year s second fiscal quarter, and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates equals or exceeds $250 million as of the end of that year s second fiscal quarter, or (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates equals or exceeds $700 million as of the end of that year s second fiscal quarter. Exempted companies are Cayman Islands companies wishing to conduct business outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and have received a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 30 years from the date of such undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations shall apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax shall be payable (1) on or in respect of our shares, debentures or other obligations or (2) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. 12 Table of Contents We are a Cayman Islands exempted company incorporated on April 13, 2021. Our executive offices are located at 2400 E. Commercial Boulevard, Suite 900, Ft. Lauderdale, FL 33308 and our telephone number is (954) 315-9380. Upon completion of this offering, our corporate website address will be . Our website and the information contained on, or that can be accessed through, the website is not deemed to be incorporated by reference in, and is not considered part of, this prospectus or the registration statement of which this prospectus is a part. You should not rely on any such information in making your decision whether to invest in our securities. 13 Table of Contents
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+PROSPECTUS SUMMARY The following summary highlights selected information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our securities, you should carefully read this entire prospectus, including our consolidated financial statements and the related notes included in this prospectus and the information set forth under the headings Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations. The Company In the story of David vs. Goliath, the small underdog is able to outsmart and defeat his larger adversary. This is the spirit behind the name Dave. We have built an integrated financial services online platform that provides millions of Americans with seamless access to a variety of intuitive financial products at a fraction of the cost and with much higher speed to value than that of the legacy financial services incumbents, such as traditional banks and other financial institutions. Our mission is to create financial opportunity that advances America s collective potential. Based on the Company s observation and analysis of data gathered from its Members, legacy financial institutions charge high fees for financial banking products, which disproportionately burdens tens of millions of Americans who need it most. We see this dynamic playing out with our Members who we believe are on average paying between $300-$400 in overdraft, maintenance and other fees to their existing bank for basic checking services. According to a report by the Center for Financial Services Innovation ( CFSI ), legacy financial institutions charge approximately $30 billion in fees annually. The Consumer Financial Protection Bureau ( CFPB ) reports that more than 50 million Americans overdraft multiple times per year. According to the Financial Health Network, by 2023 approximately 45 million Americans will be financially vulnerable, 65 million Americans will be unbanked or underbanked and 185 million Americans will fall into the low or volatile income and credit-challenged category. Given these dynamics, our potential Member opportunity is significant. We estimate that our total addressable market consists of between 150 million to 180 million Americans who are in need of financial stability and are either not served or underserved by legacy financial institutions. Dave offers a suite of innovative financial products aimed at helping our Members improve their financial health. Our budgeting tool helps Members manage their upcoming bills to avoid overspending. To help Members avoid punitive overdraft fees, Dave offers cash advances through its flagship 0% interest ExtraCash product. We also help Members generate extra income for spending or emergencies through our Side Hustle product, where we present Members with supplemental work opportunities. Through Dave Banking, we provide a modern checking account experience with valuable tools for building long-term financial health. Market research conducted by Dave found that legacy financial institutions commonly require a more extensive banking relationship and days or even weeks of wait times to access their features and services, which can potentially be more onerous in order to obtain premium features (e.g., access to increased interest rates requires direct deposit or higher minimum daily balances). Even new challenger banks often take multiple days or even weeks before allowing members to access certain premium features, according to the same research. In contrast, Members are able to utilize all of Dave s products individually and instantly, whether or not their banking relationship is with us. As an example, our ExtraCash product allows new Members to access up to $250 to cover an overdraft at their existing bank. We are able to do this by leveraging our proprietary machine learning engine that analyzes a Member s prior transaction history at their existing bank. This flexible approach to Member choice and speed to value has been a key driver of our growth and best-in-Class brand favorability. According to market research conducted by Dave in June 2021 through a third-party using a quantitative online Table of Contents survey of 2,021 respondents across the United States 73% of respondents rated Dave in the two highest favorable categories (42% very favorable and 30% somewhat favorable) compared to other bank innovators. We have only begun to address the many inequities in financial services, but our progress to date demonstrates the demand for Dave to rewire the financial system for the everyday person. Since inception and through the date of this prospectus, approximately 10 million Members have registered on the Dave app and over five million of them have used at least one of our current products. We have added more than one million new banking relationships over the last 12 months, and we believe that we have a substantial opportunity to grow our Member base going forward. We believe the value proposition of our platform approach will continue to accelerate as a result of our data-driven perspective of our Members, allowing us to introduce products and services that address their changing life circumstances. Corporate Information We were incorporated on January 14, 2021 as a Delaware corporation under the name VPC Impact Acquisition Holdings III, Inc. ( VPCC ) for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. On March 4, 2021, VPCC completed its initial public offering. On January 5, 2022, VPCC consummated the Business Combination with Dave pursuant to the Merger Agreement and changed its name to Dave Inc. Our principal executive offices are located at 1265 South Cochran Avenue, Los Angeles, California 90019. Our telephone number is (844) 857-3283. Our website address is www.dave.com . Information contained on our website or connected thereto does not constitute part of, and is not incorporated by reference into, this prospectus or the registration statement of which it forms a part. Dave, the Dave logo and our other registered or common law trademarks, service marks or trade names appearing in this prospectus are the property of Dave. Other trademarks, service marks and trade names used in this prospectus are the property of their respective owners. Table of Contents The Offering Issuer Dave Inc. (f/k/a VPC Impact Acquisition Holdings III, Inc). Issuance of Dave Class A Common Stock Shares of Dave Class A Common Stock offered by us 59,895,003 shares of Dave Class A Common Stock, consisting of 48,450,639 shares of Dave Class A Common Stock that are issuable upon conversion of 48,450,639 outstanding shares of Dave Class V Common Stock; 5,100,214 shares of Dave Class A Common Stock that are issuable upon the exercise of 5,100,214 Private Warrants; and 6,344,150 shares of Dave Class A Common Stock that are issuable upon the exercise of 6,344,150 Public Warrants. Shares of Dave Class A Common Stock outstanding prior to exercise of all Dave Warrants and conversion of all Dave Class V Common Stock 323,549,861 shares of Dave Class A Common Stock (as of January 5, 2022). Shares of Dave Class A Common Stock outstanding assuming exercise of all Dave Warrants and conversion of all Dave Class V Common Stock 383,444,864 shares of Dave Class A Common Stock (as of January 5, 2022). Exercise Price of Private Warrants and Public Warrants $11.50 per share, subject to adjustments as described herein. Use of proceeds We will receive up to an aggregate of approximately $131.61 million from the exercise of the Dave Warrants, assuming the exercise in full of all of the Dave Warrants for cash. We will receive up to an aggregate of approximately $0.21 million from the exercise of Option Shares, assuming the exercise in full of all of the Option Shares for cash. We expect to use the net proceeds from the exercise of the Dave Warrants and Option Shares, if any, for general corporate purposes. See Use of Procee ds. Resale of Dave Class A Common Stock and Dave Warrants Securities offered by the Selling Securityholders 331,404,740 shares of Dave Class A Common Stock, consisting of: 21,000,000 shares of Dave Class A Common Stock issued in the PIPE Financing; 5,392,528 Founder Shares; 244,949,074 shares of Dave Class A Common Stock issued upon consummation of our business combination pursuant to the Merger Agreement and held by certain of our directors and officers and other holders of registration rights; Table of Contents 48,450,639 shares of Dave Class A Common Stock that are issuable upon conversion of 48,450,639 outstanding shares of Dave Class V Common Stock held by Jason Wilk, our Chief Executive Officer; 6,344,150 shares of Dave Class A Common Stock that are issuable upon the exercise of 6,344,150 Public Warrants; 168,135 shares of Dave Class A Common Stock underlying Legacy Dave Options held by certain former employees of Legacy Dave; and 5,100,214 shares of Dave Class A Common Stock that are issuable upon the exercise of 5,100,214 Private Warrants. Dave Warrants offered by the Selling Securityholders 5,100,214 Private Warrants. Terms of the offering The Selling Securityholders will determine when and how they will dispose of the shares of Dave Class A Common Stock and Private Warrants registered under this prospectus for resale. Use of proceeds We will not receive any proceeds from the sale of shares of Dave Class A Common Stock or Private Warrants (assuming the cashless exercise provision is used) by the Selling Securityholders. Lock-Up Restrictions Certain of our stockholders are subject to certain restrictions on transfer until the termination of applicable lock-up periods. See Certain Relationships and Related Transactions Lock-Up Arrangements for further discussion.
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+PROSPECTUS SUMMARY Identifiers As used in this prospectus, the following terms have the following meanings: PRC means the People s Republic of China. SEC means the U.S. Securities and Exchange Commission For ease of reference, the entities discussed in this prospectus will be identified as follows: Identifier Jurisdiction Entity Name ZKGC Cayman Cayman Islands ZKGC New Energy Limited ZKGC International Hong Kong ZKGC International Group Holdings Limited Zhongke WFOE PRC Hainan GCGY Commercial & Trading Co., Ltd. Hainan ZKGC PRC Hainan ZKGC New Energy Co., Ltd. Network ZKGY PRC Hainan ZKGY Network Technology Co., Ltd. The terms "we", "us" and "our", as used in this prospectus, refer to ZKGC Cayman and its subsidiaries, ZKGC International and Zhongke WFOE, both of which are holding companies without operations. When we refer to the two operating entities discussed in this prospectus, we identify them by name (Hainan ZKGC and Network ZKGY) and we at times refer to Hainan ZKGC as our "VIE" – i.e. variable interest entity. We make this distinction because we have no ownership interest in the VIE or in its subsidiary, Network ZKGY. Our Corporate Structure The following diagram illustrates our corporate and operating structure: 1 Contractual Arrangements with VIE This is an offering of ordinary shares issued by ZKGC Cayman. However, ZKGC Cayman does not have any business operations; nor do either of its two subsidiaries. The business operations described in this prospectus are carried on by two companies organized and located in the PRC: one is a variable interest entity ("VIE") with respect to the Chinese subsidiary of ZKGC Cayman; the other is a subsidiary of the VIE. ZKGC Cayman has entered into contracts that promise it control over the VIE. However, there is no reason to believe that ZKGC Cayman will ever gain direct ownership of the business carried on by the VIE nor can an investor in our Ordinary Shares be confident that ZKGC Cayman will be able to exercise actual control over the operations of the VIE. "Variable Interest Entity" does not describe a legal relationship; it is an accounting concept. Under U.S. Generally Accepted Accounting Principles, if Entity A exercises effective control over Entity B through contractual arrangements and will absorb the losses or receive potentially significant benefits from the operations of Entity B, then the financial results and balance sheet of Entity B should be consolidated with the financial results and balance sheet in Entity A s consolidated financial statements. Due in part to limitations under PRC law on foreign investment in value-added telecommunication services, we conduct substantially all of our operations in China through contractual arrangements with Hainan ZKGC and Network ZKGY, our consolidated variable interest entity, its subsidiary, and their shareholders. We do not hold any equity interest in either Hainan ZKGC or Network ZKGY. We depend on Hainan ZKGC and Network ZKGY to operate substantially all of the business reflected in our financial statements. Our subsidiary, Zhongke WFOE, has entered into contractual arrangements with Hainan ZKGC and its shareholder, which enable Zhongke WFOE, to: direct the activities of Hainan ZKGC and Network ZKGY that most significantly impact their economic performance; absorb losses and receive benefits from Hainan ZKGC s and Network ZKGY s operations; and have an exclusive option to purchase, to the extent permitted by applicable PRC law, all of the equity interests in Hainan ZKGC. The contracts among Zhongke WFOE, Hainan ZKGC and Liao Jinqi, the owner of Hainan ZKGC, contain the following specific provisions that are relevant to the determination that Hainan ZKGC is a variable interest entity with respect to Zhongke WFOE: Exclusive Business Cooperation Agreement. In this agreement, Hainan ZKGC appointed Zhongke WFOE as its exclusive service provider with respect to "comprehensive marketing services, management consultation services, technical support and other services" specifically related to the construction and marketing of charging stations. The parties further agreed that Zhongke WFOE will license to Hainan ZKGC intellectual property related to the charging station business. Zhongke WFOE further covenanted to provide Hainan ZKGC such funding as it will require for its operations, with the understanding that Zhongke WFOE has the discretion to decide if and when Hainan ZKGC should abandon its business. In exchange for these covenants, Hainan ZKGC agreed to pay a fee to Zhongke WFOE equal to the gross profit realized by Hainan ZKGC less and loss incurred by Hainan ZKGC. Equity Interest Pledge Agreement. In this agreement, Liao Jinqi pledged his ownership interest in Hainan ZKGC to secure the obligations of Hainan ZKGC under the Exclusive Business Cooperation Agreement. Exclusive Option Agreement. In this agreement, Liao Jinqi granted to Zhongke WFOE an option to purchase all of the equity interest in Hainan ZKGC for the lowest price that the PRC government will permit. Mr. Liao also covenanted that no change would be made to the governing instruments of Hainan ZKGC, its debt structure, or its material contracts without the approval of Zhongke WFOE. In sum, these contracts promise that Zhongke WFOE will realize substantially all of the benefits and losses resulting from the business operations of the VIE, and will have control over the operations carried on in China. (A detailed summary of the terms of the VIE contracts may be found in the section titled "Our Corporate Structure" at page 29.) Section 810-10-25-43 of the Accounting Standards Codification characterizes the controlling entity in such a relationship as the "Principal Beneficiary" of the VIE, and the ASC requires that the Principal Beneficiary consolidate the balance sheet and financial results of the VIE in the financial statements of the Principal Beneficiary. Since ZKGC Cayman consolidates Zhongke WFOE, its wholly-owned subsidiary, in its financial statements, our consolidated financial statements reflect the consolidation of the VIE as well. However, for reasons described in the section of this prospectus titled "Risk Factors: Risks Related to the VIE Structure", Zhongke WFOE may not be able to exercise the control promised by the VIE contracts and we may not realize the benefits resulting from the business operations of the VIE. We may find that we are unable to consolidate the financial results of the VIE with the financial statements of ZKGC Cayman if the Chinese government or judicial system determine that the relationship we created between Zhongke WFOE and Hainan ZKGC violates Chinese law or policy, a determination that would likely eliminate Zhongke WFOE s control over Hainan ZKGC and so terminate its status as Primary Beneficiary. In the event of such a determination, the relationship between ZKGC Cayman and Hainan ZKGC would likely terminate, in which case ZKGC Cayman would be forced to undertake a different business activity or to terminate its business activities and dissolve, in which case investors would lose most or all of their investment. 2 In general, investment in an entity whose equity value depends on contractual arrangements governed by the laws of the PRC is less advantageous to the investor than investment in an entity that has legal ownership of the assets on which the business of the entity depends. An investor who purchases the Ordinary Shares issued by ZKGC Cayman has no voting interest or other rights with respect to the entity that will carry on the business from which the investor hopes to realize a gain. The specific risks of depending on a VIE relationship with a Chinese entity include the following: The courts in China have not determined whether the VIE contracts are enforceable. If the courts determine that VIE contracts such as those between Zhongke WFOE and Hainan ZKGC are not enforceable in China, the value of our Ordinary Shares would be severely reduced. The reason for using the VIE relationship is that Chinese law prevents direct ownership of a company engaged in the business described in this prospectus. This may influence the Chinese courts to decide that the VIE contracts are not enforceable. In addition, the fact that the VIE structure was adopted as a measure to bypass restrictions on foreign ownership of certain Chinese businesses may influence government agencies to deny Hainan ZKGC certain benefits (such as conversion of Renminbi into foreign currency) or to impose on Hainan ZKGC certain burdens (such as denial of a tax deduction for payments by Hainan ZKGC to Zhongke WFOE. The courts may determine that the VIE structure actually violates the restriction on foreign investment in the value-added telecommunications industry, and so find the VIE to be operating illegally, in which case Hainan ZKGC may be forced to terminate operations, which would likely result in a loss of the value of our Ordinary Shares.. If the enforceability of the VIE contracts became the subject of legal proceedings in China, ZKGC Cayman could incur substantial legal expenses in the effort to enforce its rights, with no assurance of ultimate success. Please refer to "Risk Factors: Risks Related to the VIE Structure" for a detailed analysis of the uncertainties and challenges that use of the VIE structure poses for ZKGC Cayman. Cash Flow The Exclusive Business Cooperation Agreement between Zhongke WFOE and Hainan ZKGC provides that on a quarterly basis Hainan ZKGC will pay to Zhongke WFOE a fee equal to the net income of Hainan ZKGC for the preceding quarter. However, the same agreement also says that the quarterly fee payable may be reduced to assure that Hainan ZKGC has sufficient capital to implement its business plan. In reliance on that latter provision, Hainan ZKGC has, to date, paid nothing to Zhongke WFOE, as it requires all of its cash resources to launch its business operations. Moreover, we do not expect that Hainan ZKGC will pay anything to Zhongke WFOE during the next several years, as Hainan ZKGC will require all of its cash reserves to fund its effort to become a leading participant in the market for charging stations. Investors in our Ordinary Shares, therefore, should not anticipate receiving dividends from ZKGC Cayman in the foreseeable future. If and when the time comes that Hainan ZKGC has cash reserves in excess of its requirements, our ambition is that Hainan ZKGC would then settle its account due to Zhongke WFOE, which would then distribute funds through our Hong Kong subsidiary to ZKGC Cayman, which might then determine to pay dividends. A number of factors could at that time eliminate or limit the ability of the parties to transfer funds in this manner: If the PRC tax authorities determine that the agreements between Zhongke WFOE and Hainan ZKGC violate Chinese laws and regulations, the transfer of funds by Hainan ZKGC could be prevented by government intervention. If PRC tax authorities determine that the VIE agreements between Zhongke WFOE and Hainan ZKGC were not made on an arm s length basis and result in an impermissible reduction in taxes under applicable PRC rules, a transfer pricing adjustment could result in a reduction of the expense deduction recorded by Hainan ZKGC, which would eliminate Hainan ZKGC s tax deduction for payments to Zhongke WFOE, rendering the settlement of accounts between them extremely expensive. Under the Enterprise Income Tax Law, a 10% withholding tax is applicable to most dividends paid by a resident enterprise to investors that are non-resident enterprises. PRC regulations require that a foreign-owned enterprise fund a statutory reserve fund by setting aside at least 10% of its after tax profits until the amount of the fund reaches 50% of its registered capital. That reserve would necessarily reduce dividends payable. The PRC government may continue to strengthen its capital controls, and more restrictions and vetting procedures may be introduced by SAFE for cross-border transactions. Any or all of these enhanced restrictions could limit the ability of Zhongke WFOE to transfer funds upstream. 3 For all of the aforesaid reasons, investors should not purchase our Ordinary Shares with any expectation of receiving dividend payments. Business Summary The business that will be described in this prospectus is business carried on by Hainan ZKGC and Network ZKGY. Neither ZKGC nor its subsidiaries has any direct control over that business, as they do not own either Hainan ZKGC or Network ZKGY. The Company s control over the business is limited to the contractual covenants contained in certain agreements (identified by reference to their accounting significance as "VIE Agreements") among Zhongke WFOE, Hainan ZKGC, and Liao Jinqi in his role as owner of the equity in Hainan ZKGC. Hainan ZKGC and its 99%-owned subsidiary, Network ZKGY, are engaged in the business of constructing and operating charging stations for electric vehicles ("EV"). All of the charging stations installed by Hainan ZKGC are linked to a software platform provided by Network ZKGY under the tradename "Charging Cloud SaaS Platform", which enables the parties responsible for each charging station to monitor and manage the charging stations. The offices of Hainan ZKGC are located in Haikou City, which is the capital city of Hainan Province. To date, Hainan ZKGC has installed charging stations exclusively in the 18 cities and counties of Hainan Province. Its business plan is to rapidly grow into a dominant provider of charging stations in Hainan Province, and then, during 2022, expand its operations onto the mainland, and develop a market presence in southeast China. Chinese Government Regulations That May Affect Us or the VIE Each aspect of the business operations of the VIE, Hainan ZKGC, and each aspect of the relationship of ZKGC Cayman and its subsidiaries with Hainan ZKGC is the subject of one or more regulations imposed by the government of the PRC or the PRC Provincial governments. The risks of non-compliance are several: we or the VIE could be denied a necessary license or permission; we or the VIE could inadvertently overlook the requirement to obtain a license or permission; we or the VIE could obtain the necessary license or permission but fail to comply with the regulations governing the regulated activity; or the regulations could change in a way that interferes with our ability to carry out our business plan. Any of these situations could prevent us from carrying out our business plan and result in loss to our investors. The consequences of failure or inability to conform our conduct, or that of the VIE, to government policy will vary: the significance of the consequence will tend to reflect the level of concern that the government holds for the subject of the regulation. If Hainan ZKGC fails to comply with government regulation of the operation of charging stations, the penalties could range from a fine to a revocation of its license to carry on the charging station business. If we fail to comply with regulations regarding financial matters (securities offerings, cash flows, the VIE structure itself), the penalties could range from significant civil penalties (e.g. revocation of business licensee) to criminal penalties. We and Hainan ZKGC have tried to be scrupulous in ascertaining the obligations that Chinese government regulations impose on us. In connection with the regulations applicable to Hainan ZKGC s charging station business, Hainan ZKGC has primarily relied on the expertise of its Chairman, Liao Jinqi, who has eight years of executive experience in the charging station business. With regard to PRC regulation of the involvement of offshore entities and investors with Chinese companies, we have consulted Chinese legal counsel and received their opinions and assurances. The following paragraphs classify the principal regulations with which we or Hainan ZKGC must comply by reference to the aspect of our business to which they apply: The Charging Station Business. Our current business of installing and operating charging stations in Hainan Province requires the involvement of the government at four points; the same points (with a different provincial authority) will apply when Hainan ZKGC expands its operations onto the Chinese mainland: To initiate the business of providing EV charging services, Hainan ZKGC was required to register with, and obtain approval from, the Hainan Province Development and Reform Commission; Prior to each installation of a charging station, Hainan ZKGC is required to register the construction and operation plan for the charging station with the County and receive approval of the plan; Each installation of a charging station requires a construction permit: if the charging station is being installed on an existing parking lot or other commercial location, Hainan ZKGC requires a construction permit from the local Land Reserve and Development Department; if the installation will be made on raw land, Hainan ZKGC also requires a zoning permit from the Residential Construction and Planning Department of the local township. Prior to placing any charging station into service, inspection and approval must be obtained from the local township, the construction department, and the relevant electric utility. Hainan ZKGC believes that it is in full compliance with all of the aforesaid regulations. 4 Securities Offering and Listing. As of the date of this prospectus, it is our opinion, based on advice of our PRC counsel, that neither ZKGC Cayman nor its subsidiaries nor Hainan ZKGC, the VIE, are subject to permission requirements from the China Securities Regulatory Commission (the "CSRC"), the Cyberspace Administration of China (the "CAC") or any other entity in order for ZKGC Cayman to issue its ordinary shares and list them on a U.S. exchange, nor have they received or were denied such permissions by any PRC authorities. If our opinion is incorrect, however, or if applicable laws, regulations or interpretations of law change and we or the VIE become required to secure approval from one or more Chinese government agencies prior to an issuance of Ordinary Shares by ZKGC Cayman or prior to listing the Ordinary Shares for trading on a U.S. exchange, the implications for the success of our business plan could be significant. Our business plan contemplates that we will use our access to U.S. capital markets to secure the capital Hainan ZKGC will need in order to grow Hainan ZKGC into a leading participant in the Chinese market for charging stations. I the CSRC or the CAC or any other government entity were to restrict our ability to finance Hainan ZKGC from the proceeds of security sales in the U.S., we would be forced to either secure an alternative source of funds (which could result in significant dilution of our existing shareholders) or to severely reduce the pace of Hainan ZKGC s growth (which could doom its efforts at competitive strength). It should be noted that on July 6, 2021 the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointly issued the "Opinions on Severely Cracking Down on Illegal Securities Activities According to Law" (the "Opinions"). The Opinions emphasized the need to strengthen the protections against illegal securities activities, and the need to strengthen the government s supervision over overseas listings by Chinese companies. Then, on December 24, 2021, the CSRC issued Provisions of the State Council on the Administration of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) (the "Administration Provisions"), and the Provisions of the State Council on the Administration of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) (the "Measures"), which are now open for public comments. The Administration Provisions and Measures for overseas listings propose specific requirements for filing documents and include proposals for unified regulation management, strengthening regulatory coordination, and cross-border regulatory cooperation. It is uncertain when and whether ZKGC Cayman, by reason of its ownership of Zhongke WFOE or its contractual relationship with Hainan ZKGC, will be required to obtain permission from the PRC government to list on U.S. exchanges in the future. If the proposals included in the Administration Provisions or the Measures are formally adopted before Cayman ZKGC is listed on the OTCQB, we will complete the relevant filing procedures in the PRC. If the provisions are adopted after we are listed but are extended to already listed entities, we will also comply. As of the date of this prospectus, we have not received any inquiry, notice, warning, sanctions or regulatory objection to this offering from the CSRC or other PRC governmental authorities. However, there remains significant uncertainty as to the enactment, interpretation and implementation of regulatory requirements related to overseas securities offerings and other capital markets activities. On December 28, 2021 the CAC and 12 other Chinese government departments issued "New Measures for Cybersecurity Review." According to Article 7 of the New Measures, network platform operators holding personal information of more than one million users are required to apply to the Network Security Review Office for a cybersecurity review before listing their securities on in a foreign country. The cybersecurity reviewers will have broad discretion to determine whether the offshore listing may affect China s national security. In the event that Hainan ZKGC and it subsidiary accumulate personal information from more than one million users of its charging stations, it will be necessary for it to undergo the mandated security review. We cannot predict whether, at that time, a listing of ZKGC Cayman s ordinary shares on a U.S. exchange will be considered to pose a threat to China s national security. To the extent that the above discussion regarding "Securities Offerings and Listing" relates to matters of PRC law, it represents the opinion of Zhonglun W&D Law Firm, our PRC counsel. VIE Operations. There is at this time no agency of China s government that is charged with responsibility for reviewing the VIE structure employed by certain Wholly Foreign-Owned Entities, such as Zhongke WFOE. Therefore it cannot be said that any government agency has either approved or disapproved the VIE structure being employed by ZKGC Cayman. The business operations of Hainan ZKGC, the VIE, are primarily regulated by China s provinces. In particular, Hainan ZKGC is required to obtain a specific permit from the provincial government for each charging station that it installs. We anticipate that, as the market for charging stations expands, additional regulations will be imposed. We take care to ascertain the government regulations that apply to the VIE s business and our financial activities, and to fully comply with all that are applicable. Any error that we commit in ascertaining our obligations under Chinese law, or any significant change in the laws and regulations that govern our activities in China or abroad could have a serious adverse effect on the business of the VIE, including the loss of the VIE s ability to carry on its business operations. Such a loss would likely render the ordinary shares of ZKGC Cayman worthless. Cash Transfers. To date, there has been no transfer of funds among ZKGC Cayman, its subsidiaries, or its VIE. In the future, transfers from ZKGC Cayman to Hainan ZKGC, its VIE, will be desirable as a means of funding the expansion of the VIE, and transfers from Hainan ZKGC to ZKGC Cayman will be necessary if ZKGC Cayman is to pay dividends to the holders of its ordinary shares. Chinese government regulations may restrict or prevent transfers in either or both directions. Any funds that Cayman ZKGC transfers to Zhongke WFOE, either as a shareholder loan or as an increase in registered capital, will be subject to approval by or registration with relevant governmental authorities in China. According to the relevant PRC regulations on foreign-invested enterprises in China, capital contributions to our PRC subsidiary will be subject to the approval of the Ministry of Commerce, or MOFCOM, or its local branches and registration with a local bank authorized by the State Administration of Foreign Exchange, or SAFE. In addition, any medium or long-term loan to be provided by us to Zhongke WFOE must be registered with certain authorities. If we fail to complete such registrations, our ability to use capital raised by ZKGC Cayman to capitalize our Chinese subsidiary may be negatively affected, which could adversely affect our liquidity and our ability to fund and expand the business of Hainan ZKGC. 5 Our business will be carried on by Hainan ZKGC and not by Zhongke WFOE, except to the limited extent described in their consulting agreement. In order for the capital raised by ZKGC Cayman to be used in that business, Zhongke WFOE will have to comply with Chinese regulation or lending relationships. Because the VIE relationship has not been tested in China s courts or opined upon by China s government, we cannot be sure that loans from Zhongke WFOE to Hainan ZKGC will be approved. If we are not able to use fund raised by ZKGC Cayman to fund the significant capital requirements of the VIE, the business of Hainan ZKGC may be underfunded and fail. Chinese Restrictions on PCAOB Inspections. Pursuant to the Holding Foreign Companies Accountable Act ("HFCAA"), the Public Company Accounting Oversight Board (the "PCAOB") issued a Determination Report on December 16, 2021 which found that the PCAOB is unable to completely inspect or investigate registered public accounting firms headquartered in: (1) mainland China because of a position taken by one or more authorities in mainland China; and (2) Hong Kong, a Special Administrative Region and dependency of the PRC, because of a position taken by one or more authorities in Hong Kong. In addition, the PCAOB s report identified the specific registered public accounting firms which are subject to these determinations. Our registered public accounting firm, Michael T. Studer CPA, P.C., is not headquartered in mainland China or Hong Kong and was not identified in this report as a firm subject to the PCAOB s determination. Nevertheless, any future determination by the PCAOB that it is unable to perform complete inspections and investigations of our auditor would likely result in the removal of ZKGC Cayman from any U.S. securities exchange or platform on which our Ordinary Shares might be listed and severely restrict or eliminate our access to the U.S. capital markets, as trading of our securities would, after three years (or two years, if pending legislation is adopted), be prohibited under the HFCAA. Foreign Private Issuer Status We are a foreign private issuer within the meaning of the rules under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). As such, we are exempt from certain provisions applicable to United States domestic public companies. For example: we are not required to provide as many Exchange Act reports, or as frequently, as a domestic public company; for interim reporting, we are permitted to comply solely with our home country requirements, which are less rigorous than the rules that apply to domestic public companies in the United States; we are not required to provide the same level of disclosure on certain issues, such as executive compensation; we are exempt from provisions of Regulation FD aimed at preventing issuers from making selective disclosures of material information; we are not required to comply with the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; and we are not required to comply with Section 16 of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and establishing insider liability for profits realized from any "short-swing" trading transaction. Emerging Growth Company Status We are an "emerging growth company," as defined in the Jumpstart Our Business Startups Act (the "JOBS Act"), and we are eligible to take advantage of certain exemptions from various reporting and financial disclosure requirements that are applicable to other public companies that are not emerging growth companies, including, but not limited to, (1) presenting only two years of audited financial statements and only two years of related management s discussion and analysis of financial condition and results of operations in this prospectus, (2) not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, (3) reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and (4) exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We intend to take advantage of these exemptions. As a result, investors may find investing in our ordinary shares less attractive. 6 In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the "Securities Act"), for complying with new or revised accounting standards. As a result, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We could remain an emerging growth company for up to five years, or until the earliest of (1) the last day of the first fiscal year in which our annual gross revenues exceed $1.07 billion, (2) the date that we become a "large accelerated filer" as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our Ordinary shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter and we have been publicly reporting for at least 12 months, or (3) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three-year period. Selected Condensed Consolidated Financial Schedule of ZKGC Cayman and Its Subsidiaries and VIEs The following tables present selected condensed consolidated financial data of ZKGC Cayman and its subsidiaries and VIEs for the six months ended November 30, 2021 and 2020, respectively, and the years ended May 31, 2021, and balance sheet data as of November 30, 2021 and May 31, 2021, respectively, which have been derived from our audited consolidated financial statements for those periods, and unaudited selected condensed consolidated financial data for the six months ended November 30, 2021 and 2020. ZKGC Cayman records its investments in its subsidiaries under the equity method of accounting. Such investments are presented in the selected condensed consolidated balance sheets of ZKGC Cayman as "Investments in VIE" and the profit of the subsidiaries is presented as "Income for equity method investment" in the selected condensed consolidated statements of income and comprehensive income. SELECTED CONDENSED CONSOLIDATED STATEMENTS OF INCOME For the Six Months Ended November 30, 2021 (Unaudited) ZKGC Cayman VIEs Eliminations Consolidated Total Revenue $- $1,472,086 $- $1,472,086 Income for equity method investment $122,345 $- $(122,345) $- Net Income $122,345 $122,200 $(122,345) $122,200 Comprehensive income $122,757 $122,612 $(122,757) $122,612 For the Six Months Ended November 30, 2020 (Unaudited) ZKGC Cayman VIEs Eliminations Consolidated Total Revenue $- $- $- $- Loss from equity method investment $(3,478) $- $3,478 $- Net loss $(3,478) $(3,478) $3,478 $(3,478) Comprehensive loss $(3,569) $(3,569) $3,569 $(3,569) For the Year Ended May 31, 2021 ZKGC Cayman VIEs Eliminations Consolidated Total Revenue $- $320,012 $- $320,012 Income for equity method investment $35,921 $- $(35,921) $- Net income $35,921 $35,806 $(35,921) $35,806 Comprehensive income $42,961 $42,846 $(42,961) $42,846 7 SELECTED CONDENSED CONSOLIDATED BALANCE SHEETS As of November 30, 2021 (Unaudited) ZKGC Cayman VIEs Eliminations Consolidated Total Cash $- $118,387 $- $118,387 Total current assets $- $1,261,156 $- $1,261,156 Investment in subsidiaries and VIEs $409,386 $- $(409,386) $- Total non-current assets $409,386 $311,230 $(409,386) $311,230 Total assets $409,386 $1,572,386 $(409,386) $1,572,386 Total liabilities $- $1,162,955 $- $1,162,955 Total shareholders equity $(409,386) $409,431 $409,386 $409,431 Total liabilities and shareholders equity $(409,386) $1,572,386 $409,386 $1,572,386 As of May 31, 2021 ZKGC Cayman VIEs Eliminations Consolidated Total Cash $- $92,931 $- $92,931 Total current assets $- $695,452 $- $695,452 Investment in subsidiaries and VIEs $225,316 $- $(225,316) $- Total non-current assets $225,316 $265,839 $(225,316) $265,839 Total assets $225,316 $961,291 $(225,316) $961,291 Total liabilities $- $735,785 $ $735,785 Total shareholders equity $(225,316) $225,506 $225,316 $225,506 Total liabilities and shareholders equity $(225,316) $961,291 $225,316 $961,291 SELECTED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS For the Six Months Ended November 30, 2021 (Unaudited) ZKGC Cayman VIEs Eliminations Consolidated Total Net cash provided by operating activities $ - $174,025 $ - $174,025 Net cash (used in) investing activities $- $(21,380) $- $(21,380) Net cash (used in) financing activities $- $(127,501) $- $(127,501) For the Six Months Ended November 30, 2020 (Unaudited) ZKGC Cayman VIEs Eliminations Consolidated Total Net cash provided by operating activities $ - $144,937 $ - $144,937 Net cash (used in) investing activities $- $(254,421) $- $(254,421) Net cash provided by financing activities $- $130,199 $- $130,199 For the Year Ended May 31, 2021 ZKGC Cayman VIEs Eliminations Consolidated Total Net cash provided by operating activities $ - $46,132 $ - $46,132 Net cash (used in) investing activities $- $(192,904) $- $(192,904) Net cash provided by financing activities $- $238,505 $- $238,505 8 THE OFFERING Shares of common stock offered by us: None Securities offered by Selling Shareholders 3,000,000 Ordinary Shares. Ordinary Shares currently outstanding 13,000,000 Ordinary Shares Other Equity Securities Outstanding None Use of Proceeds: The Company will not receive any proceeds from the resale or other disposition of common stock offering by the selling shareholders covered by this prospectus. Risk Factors An investment in the Company s common stock is speculative and involves substantial risks. You should read the "Risk Factors" section of this prospectus beginning on page 14 for a discussion of certain factors to consider carefully before deciding to invest in our Ordinary Shares. A summary of certain significant risk factors follows. Risks of Operation in China Our operations in China give rise to a number of significant risks that could result in a significant reduction in the value of the ordinary shares you purchase, or could limit the ability of ZKGC Cayman to finance the operations of the VIE, which could in turn reduce the value of your ordinary shares. Brief summaries of some of the more significant risks that arise from investment in an entity dependent on operations in China carried on by a VIE are set forth below, with reference to the location of more detailed discussion in this prospectus. Since neither the Chinese government nor its judiciary has taken a definitive position on the enforceability of VIE contracts such as those that give us control over our operating entities, there is a significant risk that the courts will refuse to enforce VIE contracts, which would likely significantly reduce the value of our ordinary shares. See: Risk Factors – Risks Related to the VIE Structure – Neither the Government of the PRC nor the Chinese legal system has ever formally acknowledged the legality of using a VIE-type contractual arrangement where direct ownership of a Chinese entity is forbidden. If the government determines that the VIE contracts are illegal or unenforceable, our Ordinary Shares may become worthless" at page 21. There is a significant risk that Chinese courts may consider the involvement of the VIE in the field of value-added telecommunications to be illegal. See: "Risk Factors – Risks Related to the VIE Structure – Substantial uncertainties exist with respect to the interpretation and implementation of the newly enacted Foreign Investment Law and how it may impact the viability of our current corporate structure, corporate governance and operations" at page 21. 9 We have created the VIE relationship between ZKGC Cayman and Hainan ZKGC in order to enable us to finance the expansion of Hainan ZKGC by means of the access that ZKGC Cayman may have to international investment. However, certain Chinese government agencies have adopted policies and given indications that they may adopt stricter policies limiting foreign investment in Chinese business operations. If these policies develop in such a way as to limit our ability to finance the growth of Hainan ZKGC with the proceeds of securities offerings conducted outside of China, the growth of that business may be stymied, and the value of our Ordinary Shares may be seriously diminished. See: Risk Factors – Risks Related to Doing Business in China – PRC regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion may restrict or delay us from using monies invested in ZKGC Cayman to make loans or additional capital contributions to our PRC subsidiaries and making loans to Hainan ZKGC or its subsidiary, which could adversely affect our liquidity and our ability to fund and expand the business of Hainan ZKGC" at page 17. Recently adopted regulations of the Cyberspace Administration of China or recently pronounced policies of the China Securities Regulatory Commission may in the future lead to restrictions on our ability to fund the VIE from the proceeds of securities offerings by ZKGC Cayman. Application of such policies to Hainan ZKGC could require that company to make significant revisions to its business plan in order to accommodate its reduced access to capital. If that revision were not successful, the business of Hainan ZKGC could fail, resulting in a loss of the value of our Ordinary Shares. See: "Risk Factors – Risks Related to Doing Business in China - Rules recently adopted by the Cyberspace Administration of China may restrict our ability to finance the VIE from the proceeds of securities offerings by ZKGC Cayman" at page 18 and "Increased regulation of offshore offerings by the CSRC could interfere with our ability to finance the operations of Hainan ZKGC from sales of securities issued by ZKGC Cayman" at page 18. The Chinese government frequently intervenes in business affairs in China for the sake of new government policies. Some recent government interventions have had serious adverse effects on Chinese business enterprises, including several of the larger enterprises in China. Because principles of substantive due process are not honored in China, businesses affected by such government interventions have no recourse to any source of relief. There is a significant risk, therefore, that the government of China will suddenly adopt policies or regulations that prevent us from financing Hainan ZKGC in the manner we have planned or that prevent Hainan ZKGC from implementing its business plan in the manner contemplated. See: "Risk Factors – Risks Related to Doing Business in China - PRC laws and regulations governing the current business operations of Hainan ZKGC are sometimes vague and subject to interpretation. Moreover, the PRC has recently adopted regulatory policies regarding the conduct of business in the PRC that have had sudden adverse effects on business operations. Any changes in PRC laws and regulations or in their interpretation may have a material and adverse effect on our business at page 19. Other Significant Risks At the same time, the business operations of the VIE face the kind of significant risks that are common to start-up enterprises, including: The ability of larger competitors to exert pressure on Hainan ZKGC by charging lower service fees to customers; and Hainan ZKGC s need to secure substantial capital investment in order to secure a competitive position in the market for EV charging services. These and other risks that may cause your investment in ZKGC Cayman to fail are discussed in detail in the section of this prospectus titled "Risk Factors" at page 14. 10 SUMMARY CONSOLIDATED FINANCIAL AND OPERATING DATA The following summary consolidated statement of operations data for the period from August 11, 2020 (inception of operations) to May 31, 2021 and the summary balance sheet information as of May 31, 2021 have been derived from the audited financial statement of ZKGC Cayman and subsidiaries included elsewhere in this prospectus. This summary financial data should be read in conjunction with the consolidated financial statements of ZKGC Cayman and subsidiaries for the period ended May 31, 2021. ZKGC NEW ENERGY LIMITED AND SUBSIDIARIES AND VARIABLE INTEREST ENTITY SUMMARY CONSOLIDATED BALANCE SHEET November 30, 2021 (Unaudited) May 31, 2021 Current assets $1,261,156 $695,452 Total assets $1,572,386 $961,291 Current and total liabilities $1,162,955 $735,785 Shareholders equity $409,431 $225,316 ZKGC NEW ENERGY LIMITED AND SUBSIDIARIES AND VARIABLE INTEREST ENTITY SUMMARY CONSOLIDATED STATEMENTS OF OPERATIONS For the Six Month Ended November 30, 2021 (Unaudited) Period from August 11, 2020 (inception) to November 30, 2020 (Unaudited) Period from August 11, 2020 (inception) to May 31, 2021 Revenues $1,472,086 $- $320,012 Gross profit $200,459 $- $54,543 Gain (loss) from operations $106,569 $(4,564) $(7,552) Net income (loss) $122,200 $(3,478) $35,806 Disaggregation ZKGC Cayman was organized on May 31, 2021. Its two subsidiaries were each organized subsequent to that date. As a result, each of the balance sheet items shown in the summary above was, on May 31, 2021, attributable entirely to the balance sheet of Hainan ZKGC. The revenue, loss from operations and net income shown in the summary was also entirely attributable to the operations of the VIE. And the cash flows shown in the consolidated financial statements for the period ended May 31, 2021 were likewise entirely attributable to the cash flows recorded by Hainan ZKGC. 11
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/DFCO_dalrada_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/DFCO_dalrada_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..07db18afbde1f36b88ccf71747acadb78ec21aee
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/DFCO_dalrada_prospectus_summary.txt
@@ -0,0 +1,3430 @@
+Prospectus Summary - Yorkville
+Transaction above. In addition we are registering common shares to Carter, Terry & Company pursuant to a Consulting
+Agreement providing an agent fee for securing the funding with Yorkville. We are registering the shares of Common Stock in order to permit
+the selling stockholders to offer the shares for resale from time to time. Except as otherwise noted and except for the ownership of
+the convertible debenture and warrant issued pursuant to the Securities Purchase Agreements, the selling stockholders have not had any
+material relationship with us within the past three years.
+
+ 
+
+The table below lists the
+selling stockholders and other information regarding the beneficial ownership of the shares of Common Stock by each of the selling stockholders.
+The second column lists the number of shares of Common Stock beneficially owned by each selling stockholder, based on its ownership of
+the convertible debentures and warrants, as of February 10, 2022, assuming conversion of all the convertible debentures and exercise of
+all of the warrants held by the selling stockholders on that date, without regard to any limitations on conversions or exercise.
+
+ 
+
+The third column lists the
+shares of Common Stock being offered by this prospectus by the selling stockholders.
+
+ 
+
+In accordance with the terms
+of a registration rights agreement with the selling stockholders, this prospectus generally covers the resale of 15,175,499 shares of
+common stock issued or issuable to the selling stockholders pursuant to the Securities Purchase Agreement. Because the conversion
+price of the convertible debenture and exercise price of the warrant may be adjusted, the number of shares that will actually be issued
+may be more or less than the number of shares being offered by this prospectus. The fourth column assumes the sale of all of the shares
+offered by the selling stockholders pursuant to this prospectus.
+
+ 
+
+Under the terms of the convertible
+debenture and warrant, a selling stockholder may not convert the convertible debenture or exercise the warrant to the extent such conversion
+or exercise would cause such selling stockholder, together with its affiliates, to beneficially own a number of shares of Common Stock
+which would exceed 4.99% of our then outstanding shares of Common Stock following such conversion or exercise, excluding for purposes
+of such determination shares of Common Stock issuable upon conversion of the convertible debentures which have not been converted. The
+number of shares in the second column does not reflect this limitation. The selling stockholders may sell all, some or none of their
+shares in this offering. See Plan of Distribution. 
+
+ 
+
+ 
+ Name of Selling Shareholder 
+ Shares Beneficially Owned by the Selling Stockholder before
+ the Offering (1) 
+ Maximum Number of Shares to be Sold Pursuant to this Prospectus 
+ Number of Shares Owned After the Offering 
+
+ 
+ YA II PN, Ltd. (1) (2) 
+ 3,502,190 
+ 14,983,499 
+ 0 
+
+ Carter, Terry & Company (3) 
+ 28,800 
+ 28,800 
+ 0 
+
+ Adam Cabibi (3) 
+ 163,200 
+ 163,200 
+ 0 
+
+ 
+
+(1)The Selling Shareholder has the
+ right to acquire 983,499 shares of Common Stock underlying Warrants, and the right to acquire
+ additional shares of Common Stock upon conversion of the Convertible Notes. Under the terms
+ of the Convertible Notes, the Warrants and the Securities Purchase Agreement, the Selling
+ Shareholder may not convert the Convertible Notes or exercise the Warrants to the extent
+ (but only to the extent) it or any of its affiliates would beneficially own a number of shares
+ of common stock which would exceed 4.99% of the total shares of common stock issued and outstanding
+ as of the date of such conversion.
+
+ 
+
+(2)YA II PN, Ltd. ( YA II )is
+ a fund managed by Yorkville Advisors Global, LP ( Yorkville LP ). Yorkville Advisors
+ Global II, LLC ( Yorkville LLC ) is the General Partner of Yorkville LP. All
+ investment decisions for YA are made by Yorkville LLC s President and Managing Member,
+ Mr. Mark Angelo. The business address of YA is 1012 Springfield Avenue, Mountainside, NJ
+ 07092.
+
+ 
+
+ 
+ 
+ (3)
+ Carter, Terry & Company is leading investment institution in Atlanta, serving clients throughout
+ the country. The common shares to be issued pursuant to their Consulting Agreement is as follows: 1) 28,800 common shares to Carter,
+ Terry & Company, with the remaining 163,200 common shares being issued to Adam Cabibi, the managing director of Carter, Terry
+ & Company.
+
+ 
+
+ 
+
+ 
+
+ 28 
+
+ 
+
+ 
+
+ 
+
+PLAN OF DISTRIBUTION
+
+ 
+
+The Selling Stockholder (the
+ Selling Stockholder ) of the common stock and any of its pledgees, assignees and successors-in-interest may, from
+time to time, sell any or all of its shares of common stock on the OTCQB or any other stock exchange, market or trading facility on which
+the shares are traded or in private transactions. These sales may be at fixed or negotiated prices. A Selling Stockholder may use any
+one or more of the following methods when selling shares:
+
+ 
+
+ 
+ 
+ 
+ ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an exchange distribution in accordance with the rules of the applicable exchange;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ privately negotiated transactions;
+
+ 
+ 
+
+ 
+ 
+ 
+ broker-dealers may agree with the Selling Stockholders to sell a specified number of such shares at a stipulated price per share;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ a combination of any such methods of sale; or
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ any other method permitted pursuant to applicable law.
+
+ 
+ 
+
+The Selling Stockholders may
+also sell shares under Rule 144 under the Securities Act of 1933, as amended (the Securities Act ), if available,
+rather than under this prospectus.
+
+ 
+
+Broker-dealers engaged by
+the Selling Stockholder may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive commissions or discounts
+from the Selling Stockholders (or, if any broker-dealer acts as agent for the purchaser of shares, from the purchaser) in amounts to be
+negotiated, but, except as set forth in a supplement to this Prospectus, in the case of an agency transaction not in excess of a customary
+brokerage commission in compliance with NASDAQ Rule 2440; and in the case of a principal transaction a markup or markdown in compliance
+with NASDAQ IM-2440.
+
+ 
+
+In connection with the sale
+of the common stock or interests therein, the Selling Stockholder may enter into hedging transactions with broker-dealers or other financial
+institutions, which may in turn engage in short sales of the Common Stock in the course of hedging the positions they assume. The Selling
+Stockholder may also enter into option or other transactions with broker-dealers or other financial institutions or the creation of one
+or more derivative securities which require the delivery to such broker-dealer or other financial institution of shares offered by this
+prospectus, which shares such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or
+amended to reflect such transaction).
+
+ 
+
+The Selling Stockholder and
+any broker-dealers or agents that are involved in selling the shares may be deemed to be underwriters within the meaning
+of the Securities Act in connection with such sales. In such event, any commissions received by such broker-dealers or agents and any
+profit on the resale of the shares purchased by them may be deemed to be underwriting commissions or discounts under the Securities Act.
+Each Selling Stockholder has informed the Company that it does not have any written or oral agreement or understanding, directly or indirectly,
+with any person to distribute the Common Stock. In no event shall any broker-dealer receive fees, commissions and markups which, in the
+aggregate, would exceed eight percent (8%).
+
+ 
+
+ 
+
+ 29 
+
+ 
+
+ 
+
+ 
+
+The Company is required to
+pay certain fees and expenses incurred by the Company incident to the registration of the shares. The Company has agreed to indemnify
+the Selling Stockholders against certain losses, claims, damages and liabilities, including liabilities under the Securities Act.
+
+ 
+
+Because Selling Stockholder
+may be deemed to be underwriters within the meaning of the Securities Act, they will be subject to the prospectus delivery
+requirements of the Securities Act including Rule 172 thereunder. In addition, any securities covered by this prospectus which qualify
+for sale pursuant to Rule 144 under the Securities Act may be sold under Rule 144 rather than under this prospectus. There is no underwriter
+or coordinating broker acting in connection with the proposed sale of the resale shares by the Selling Stockholder.
+
+ 
+
+We agreed to keep this prospectus
+effective until the earlier of (i) the date on which the shares may be resold by the Selling Stockholder without registration and without
+regard to any volume limitations by reason of Rule 144(k) under the Securities Act or any other rule of similar effect or (ii) all of
+the shares have been sold pursuant to this prospectus or Rule 144 under the Securities Act or any other rule of similar effect. The resale
+shares will be sold only through registered or licensed brokers or dealers if required under applicable state securities laws. In addition,
+in certain states, the resale shares may not be sold unless they have been registered or qualified for sale in the applicable state or
+an exemption from the registration or qualification requirement is available and is complied with.
+
+ 
+
+Under applicable rules and
+regulations under the Exchange Act, any person engaged in the distribution of the resale shares may not simultaneously engage in market
+making activities with respect to the common stock for the applicable restricted period, as defined in Regulation M, prior to the commencement
+of the distribution. In addition, the Selling Stockholder will be subject to applicable provisions of the Exchange Act and the rules and
+regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of shares of the common stock by the
+Selling Stockholder or any other person. We will make copies of this prospectus available to the Selling Stockholder and have informed
+them of the need to deliver a copy of this prospectus to each purchaser at or prior to the time of the sale (including by compliance with
+Rule 172 under the Securities Act).
+
+ 
+
+ 
+
+TERMS OF THE OFFERING
+
+ 
+
+The Yorkville Transaction
+
+ 
+
+Convertible Notes
+
+ 
+
+On or about February 4, 2022, Dalrada Financial
+Corporation (the Company ) entered into a securities purchase agreement ( SPA ) with YA II PN, Ltd. (the
+ Buyer ) for issuance and sale of convertible debentures (the Debentures ) in the aggregate principal
+amount of $3,000,000. The first Debenture in a principal amount of $2,000,000 was purchased upon the signing of the SPA on February 7,
+2022 (the First Closing ), and the second Debenture in the principal amount of $1,000,000 shall be purchased upon
+the filing of a registration statement with the U.S. Securities and Exchange Commission registering the resale of the shares of Common
+Stock underlying the Debenture by the Buyer (the Second Closing ), with the purchase price equal to 96% of the principal
+amount. The Debentures have a fixed conversion price of $0.9151 per share (the Fixed Conversion Price ). The principal
+and interest, which will accrue at a rate of 5% per annum, payable under the Debentures will mature 15 months from the issuance date (the
+ Maturity Date ), unless earlier converted or redeemed by the Company. At any time before the Maturity Date, the Buyer
+may convert the Debentures into the Company s common stock at the Fixed Conversion Price. Beginning on May 1, 2022 and continuing
+on the first day of each calendar month thereafter through February 1, 2023, the Principal amount plus a 20% redemption premium and plus
+accrued and unpaid interest will be subject to monthly redemption ( Monthly Redemption ). Under Monthly Redemption, the Company
+shall redeem an applicable redemption amount in accordance with the redemption schedule provided in the Debenture, which is subject to
+pro rata adjustment to reflect the conversion or redemption otherwise effected pursuant to the Debenture contemporaneous with or prior
+to the scheduled redemption date, in cash, in common stock through the Buyer s conversion of the Debenture (at any time after the
+applicable redemption date), or a combination of both at the Company s option. With respect to each Monthly Redemption all or partially
+in common stock, the conversion price shall be the lower of (1) the Fixed Conversion Price, or (2) 100% of the lowest daily VWAP during
+the ten consecutive trading days immediately preceding the date of conversion (the Variable Conversion Price ). The
+conversion price shall be adjusted from time to time pursuant to the other terms and conditions of the Debenture. At no point will the
+conversion price be less than $0.01.
+
+ 
+
+ 
+
+ 30 
+
+ 
+
+ 
+
+ 
+
+Warrants:
+
+ 
+
+The Company will issue to the Investor warrants
+equal to 30% coverage exercisable at a strike price equal to the Fixed Conversion Price determined at the date of the initial closing
+or 983,499. The Warrants shall be exercisable for four (4) years and shall be exercised on a cash basis provided the Company is not in
+default and the shares underlying the Warrant are subject to an effective registration statement at the time of the Investor s
+exercise. There is a cashless provision.
+
+ 
+
+Carter, Terry & Company
+
+ 
+
+Common Shares:
+
+ 
+
+On December 10, 2021,
+we entered into a Consulting Agreement (the Consulting Agreement ) with Carter, Terry and Company acting as the Company s
+Financial Advisor and Placement Agent, on a best efforts basis . Pursuant to the terms of that agreement, the Company agrees
+to issue to Agent upon the Closing of the transaction an amount of restricted shares equal to 4% of capital raised and received divided
+by the last reported closing price of the stock on the date of close ($0.60). The resulting shares to be issued are 192,000 common shares.
+The calculation is as follows: 
+
+$3,000,000 x 96% = $2,880,000 x 4% = $115,200/ $0.60 = 192,000 common
+shares.
+
+ 
+
+PROCEDURES AND REQUIREMENTS FOR SUBSCRIPTION
+
+ 
+
+If you decide to subscribe for any shares in this
+offering, you will be required to execute a Subscription Agreement and tender it, together with a check or certified funds to us. Subscriptions,
+once received by the company, are irrevocable.
+
+ 
+
+RIGHT TO REJECT SUBSCRIPTIONS
+
+ 
+
+We maintain the right to accept or reject subscriptions
+in whole or in part, for any reason or for no reason. All monies from rejected subscriptions will be returned immediately by us to the
+subscriber, without interest or deductions. Subscriptions for securities will be accepted or rejected within 48 hours of our having received
+them.
+
+ 
+
+DESCRIPTION OF SECURITIES
+
+ 
+
+CAPITAL STOCK
+
+ 
+
+Our authorized capital stock consists of 1,000,000,000
+shares of common stock par value of $0.005 and 100,000 shares of preferred stock with a par value of $0.01 per share.
+
+ 
+
+The following description of our capital stock
+and provisions of our Articles of Incorporation, bylaws and Wyoming corporations law are summaries and are qualified in their entirety
+by reference to our Articles of Incorporation and our bylaws. We have filed copies of these documents with the SEC as exhibits to the
+Registration Statement of which this prospectus forms a part. Pursuant to our Articles of Incorporation, as amended, our authorized capital
+stock consists of 1,000,000,000 shares of common stock, par value of $0.005 per share (which we refer to as our common stock), and 100,000
+shares of preferred stock, par value $0.01 per share, to be designated from time to time by our Board of Directors.
+
+ 
+
+Common Stock
+
+ 
+
+We are authorized to issue up to 1,000,000,000
+shares of common stock, par value $0.005 per share. Each outstanding share of common stock entitles the holder thereof to one vote per
+share on all matters. Our bylaws provide that elections for directors shall be by a plurality of votes. Stockholders do not have preemptive
+rights to purchase shares in any future issuance of our common stock. Upon our liquidation, dissolution or winding up, and after payment
+of creditors and preferred stockholders, if any, our assets will be divided pro-rata on a share-for-share basis among the holders of the
+shares of common stock.
+
+ 
+
+The holders of shares of our common stock are
+entitled to dividends out of funds legally available when and as declared by our Board of Directors. Our Board of Directors has never
+declared a dividend and does not anticipate declaring a dividend in the foreseeable future.
+
+ 
+
+All of the issued and outstanding shares of our
+common stock are duly authorized, validly issued, fully paid and non-assessable. To the extent that additional shares of our common stock
+are issued, the relative interests of existing stockholders will be diluted.
+
+ 
+
+As of February 15, 2022, there were 70,184,184
+shares of our common stock outstanding.
+
+ 
+
+ 
+
+ 31 
+
+ 
+
+ 
+
+ 
+
+Preferred Stock
+
+ 
+
+We are authorized to issue up to 100,000 shares
+of preferred stock, par value $0.01 per share, in one or more classes or series within a class as may be determined by our Board of Directors,
+who may establish, from time to time, the number of shares to be included in each class or series, may fix the designation, powers, preferences
+and rights of the shares of each such class or series and any qualifications, limitations or restrictions thereof. Any preferred stock
+so issued by the Board of Directors may rank senior to the common stock with respect to the payment of dividends or amounts upon liquidation,
+dissolution or winding up of us, or both. Moreover, under certain circumstances, the issuance of preferred stock or the existence of the
+unissued preferred stock might tend to discourage or render more difficult a merger or other change of control.
+
+ 
+
+As of February 15, 2022, there were 15,002 shares
+of our preferred stock outstanding as follows:
+
+ 
+
+Series F: 
+
+ 
+
+As of October 15, 2020, there were 5,000 shares
+of our series F preferred stock outstanding. Please see the following preferences, powers, designations and other special rights;
+
+ 
+
+1. Voting.
+
+ 
+
+Each share of Series F Super Preferred Stock shall
+entitle the holder to equal to the greater of (i) One Hundred Thousand (100,000) votes for each share of Series F Super Preferred Stock
+or (ii) the number of votes equal to the number of all outstanding shares of Common Stock, plus one additional vote such that the holders
+of Series F Super Preferred Stock shall always constitute a majority of the voting rights of the Corporation. In any vote or action
+of the holders of the Series F Super Preferred Stock voting together as a separate class required by law, each share of issued and outstanding
+Series F Super Preferred Stock shall entitle the holder thereof to one vote per share. The holders of Series F Super Preferred Stock shall
+vote together with the shares of Common Stock as one class.
+
+ 
+
+2. Dividends.
+
+ 
+
+The holders of Series F Super Voting Preferred
+Stock of the Corporation shall not be entitled to receive dividends paid on the Corporation s Common Stock.
+
+ 
+
+3. No Liquidation Preference.
+
+ 
+
+Upon liquidation, dissolution and winding up of
+the Corporation, whether voluntary or involuntary, the holders of the Series F Super Voting Preferred Stock then outstanding shall not
+be entitled to receive out of the assets of the Corporation, whether from capital or earnings available for distribution, any amounts
+which will be otherwise available to and distributed to the Common Stockholders.
+
+ 
+
+4. No Conversion.
+
+ 
+
+The shares of Series F Super Voting Preferred
+Stock will not be convertible into the shares of the Corporation s Common Stock.
+
+ 
+
+5. Vote to Change the Terms
+of or Issuance of Series F Super Voting Preferred Stock.
+
+ 
+
+The affirmative vote at a meeting duly called
+for such purpose, or written consent without a meeting, of the holders of not less than fifty-one (51%) of the then outstanding shares
+of Series F Super Voting Preferred Stock shall be required for (i) any change to the Corporation s Articles of Incorporation that
+would amend, alter, change or repeal any of the voting powers, preferences, limitations or relative rights of the Series F Super Voting
+Preferred Stock, or (ii) any issuance of additional shares of Series F Super Voting Preferred Stock.
+
+ 
+
+6. Notices. In case
+at any time:
+
+ 
+
+(a) the Corporation shall offer
+for subscription pro rata to the holders of its Common Stock any additional shares of stock of any class or other rights; or
+
+ 
+
+ 
+
+ 32 
+
+ 
+
+ 
+
+ 
+
+(b) there shall be any recapitalization,
+reorganization, reclassification, consolidation, merger, sale of all or substantially all of the Corporation s assets to another
+Person or other transaction in each case, which is effected in such a way that holders of Common Stock are entitled to receive (either
+directly or upon subsequent liquidation) stock, securities or assets with respect to or in exchange for Common Stock, referred to herein
+as an Organic Change ; then, in any one or more of such cases, the Corporation shall give, by first class mail, postage prepaid,
+or by facsimile or by recognized overnight delivery service to non-U.S. residents, addressed to the Registered Holders of the Series F
+Super Voting Preferred Stock at the address of each such Holder as shown on the books of the Corporation, (i) at least twenty (20) Trading
+Days prior written notice of the date on which the books of the Corporation shall close or a record shall be taken for such subscription
+rights or for determining rights to vote in respect of any such Organic Change and (ii) in the case of any such Organic Change, at least
+twenty (20) Trading Days prior written notice of the date when the same shall take place. Such notice in accordance with
+the foregoing clause (i) shall also specify, in the case of any such subscription rights, the date on which the holders of Common Stock
+shall be entitled thereto, and such notice in accordance with clause (ii) shall also specify the date on which the holders of Common Stock
+shall be entitled to exchange their Common Stock for securities or other property deliverable upon such Organic Change.
+
+ 
+
+7. Record Owner.
+
+ 
+
+The Corporation may deem
+the person in whose name shares of Series F Super Voting Preferred Stock shall be registered upon the registry books of the Corporation
+to be, and may treat him as, the absolute owner of the Series F Super Voting Preferred Stock for all purposes, and the Corporation shall
+not be affected by any notice to the contrary. All such payments and such conversion shall be valid and effective to satisfy and
+discharge the liabilities arising under this Certificate of Designations to the extent of the sum or sums so paid or the conversion so
+made.
+
+ 
+
+Series G:
+
+ 
+
+As of November 11, 2021, there were 10,002 shares
+of our series G convertible preferred stock issued. Please see the following preferences, powers, designations and other special rights;
+
+ 
+
+1. Conversion Price.
+The holders of shares of Series G Convertible Preferred Stock shall have the right to convert each share of Series G Convertible Preferred
+Stock into 2,177 shares of common stock, par value $0.01 per share ( Common Stock ) of the Corporation at a price equal to $0.30
+per share of Common Stock.
+
+ 
+
+2. Dividends. Except
+as provided herein, the holders of the Series G Convertible Preferred Stock shall not be entitled to receive cash, stock or other property,
+as dividends, except if declared by the Board of Directors of the Corporation. Series G Convertible Preferred Stock shall not participate
+in any dividend declared with respect to the Common Stock.
+
+ 
+
+3. Liquidation Rights.
+Upon the dissolution, liquidation or winding up of the Corporation, whether voluntary or involuntary, the holders of the then outstanding
+shares of Series G Convertible Preferred Stock shall be entitled to receive out of the assets of the Corporation the sum of $0.01 per
+share (the Liquidation Rate ) before any payment or distribution shall be made on any other class of capital stock of the Corporation
+ranking junior to the Series G Convertible Preferred Stock.
+
+ 
+
+(a) The sale, conveyance,
+exchange or transfer (for cash, shares of stock, securities or other consideration) of all the property and assets of the Corporation
+shall be deemed a dissolution, liquidation or winding up of the Corporation for purposes of this Paragraph 4, but the merger, consolidation,
+or other combination of the Corporation into or with any other corporation, or the merger, consolidation, or other combination of any
+other corporation into or with the Corporation, shall not be deemed a dissolution, liquidation or winding up, voluntary or involuntary,
+for purposes of this Paragraph 4. As used herein, the merger, consolidation, or other combination shall include, without limitation,
+a forward or reverse triangular merger, or stock exchange of the Corporation and any of its subsidiaries with any other corporation.
+
+ 
+
+(b) After the payment to
+the holders of shares of the Series G Convertible Preferred Stock of the full preferential amounts fixed by this Paragraph 4 for shares
+of the Series G Convertible Preferred Stock, the holders of the Series G Convertible Preferred Stock as such shall have no right to claim
+to any of the remaining assets of the Corporation.
+
+ 
+
+ 
+
+ 33 
+
+ 
+
+ 
+
+ 
+
+(c) In the event the assets
+of the Corporation available for distribution to the holders of the Series G Convertible Preferred Stock upon dissolution, liquidation
+or winding up of the Corporation shall be insufficient to pay in full all amounts to which such holders are entitled pursuant to this
+Paragraph 4, no distribution shall be made on account of any shares of a class or series of capital stock of the Corporation ranking on
+a parity with the shares of Series G Convertible Preferred Stock, if any, upon such dissolution, liquidation or winding up unless proportionate
+distributive amounts shall be paid on account of the shares of the Series G Convertible Preferred Stock, ratably, in proportion to the
+full distributive amounts for which holders of all such parity shares are respectively entitled upon such dissolution, liquidation or
+winding up.
+
+ 
+
+4. Preferred Status. The rights of the
+shares of the Common Stock shall be subject to the preferences and relative rights of the shares of the Series G Convertible Preferred
+Stock. Without the prior written consent of the holders of not less than a majority of the outstanding shares of the Series G Convertible
+Preferred Stock, the Corporation shall not hereafter authorize or issue additional or other capital stock that is of senior or equal rank
+to the shares of the Series G Convertible Preferred Stock in respect of the preferences as to distributions and payments upon the Liquidation,
+dissolution and winding up of the Corporation described in Paragraph 4 above.
+
+ 
+
+5. Vote to Change the Terms of the Series G
+Convertible Preferred Stock. Without the prior written consent of the holders of not less than a majority of the outstanding shares
+of the Series G Convertible Preferred Stock, the Corporation shall not amend, alter, change or repeal any of the powers, designations,
+preferences and rights of the Series G Convertible Preferred Stock.
+
+ 
+
+6. Lost or Stolen Certificates. Upon receipt
+by the Corporation of evidence satisfactory to the Corporation of the loss, theft, destruction or mutilation of any Preferred Stock Certificates
+representing shares of the Series G Convertible Preferred Stock, and, in the case of loss, theft or destruction, of any indemnification
+undertaking or bond, in the Corporation's discretion, by the holder to the Corporation and, in the case of mutilation, upon surrender
+and cancellation of the Preferred Stock Certificate(s), the Corporation shall execute and deliver new Series G Convertible Preferred Stock
+Certificate(s) of like tenor and date.
+
+ 
+
+7. Voting. Series G Convertible Preferred
+Stock shall not have voting rights.
+
+ 
+
+OPTIONS, WARRANTS AND RIGHTS
+
+ 
+
+On May 10, 2021, Pursuant to said action of the
+Board of Directors, the Company hereby granted to Kyle McCollum, (Chief Financial Officer Dalrada Financial Corporation), in consideration
+of services to be performed for the benefit of the Company, the option ( Option ) to purchase up to one million shares (1,000,000)
+( Option Shares ) of Common Stock of the Company, at the exercise price of US $0.47 per share.
+
+ 
+
+On November 10, 2021 the DFCO Board of Directors authorized the issuance
+of Cashless Warrants for up to 10,000,000 shares of the Company s Common Stock, at $.005 par value per share ( Common Stock )
+at 500,000 shares per board member, key employees or consultants with an exercise price at $0.45 per common share;
+
+ 
+
+TRANSFER AGENT
+
+Amy Merrill
+
+Standard Registrar and Transfer Company
+
+440 East 400 South, Suite 200
+
+Salt Lake City, UT 84111
+
+Phone: 801-571-8844 or 801-596-2150
+
+www.standardtransferco.com
+
+ 
+
+ 
+
+ 
+
+ 34 
+
+ 
+
+ 
+
+ 
+
+SHARES ELIGIBLE FOR FUTURE RESALE
+
+ 
+
+GENERAL
+
+ 
+
+We cannot predict the effect, if any, that market
+sales of shares of our common stock or the availability of shares of our common stock for sale will have on the market price of our common
+stock. Sales of substantial amounts of our common stock in the public market could adversely affect the market prices of our common stock
+and could impair our future ability to raise capital through the sale of our equity securities.
+
+ 
+
+Upon completion of this offering, based on our
+outstanding shares as of March 2, 2022, we will have outstanding an aggregate of 85,359,683 shares of our common stock. Of these shares,
+upon effectiveness of the registration statement of which this Prospectus forms a part, 57,966,094 common shares hereby will be freely
+transferable without restriction or further registration under the Securities Act.
+
+ 
+
+The remaining 27,393,589 restricted shares of
+common stock to be outstanding may not be resold in the public market except in compliance with the registration requirements of the Securities
+Act or under an exemption under Rule 144 or Regulation S under the Securities Act, if available, or otherwise.
+
+ 
+
+INTERESTS OF NAMED EXPERTS AND COUNSEL
+
+ 
+
+No expert or counsel named in this Prospectus
+as having prepared or certified any part of this Prospectus or having given an opinion upon the validity of the securities being registered
+or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis,
+or had, or is to receive, in connection with the offering, a substantial interest exceeding $50,000 directly or indirectly, in the Company
+or any of its parents or subsidiaries nor was any such person connected with Dalrada Financial Corporation or any of its parents or subsidiaries
+as a promoter, managing or principal underwriter, voting trustee, Director, Officer, or employee. Fletcher A. Robbe, Esq., a member
+of Dalrada Financial Corporation s Board of Directors, has opined on the validity of the shares of common stock being offered herein.
+
+ 
+
+EXPERTS
+
+ 
+
+The financial statements of the Company as of
+and for the years ended June 30, 2021 and 2020 appearing in this Prospectus and the Registration Statement of which it is a part, have
+been audited by independent registered public accounting firm, dbbmckennon, as set forth in their report dated October 13, 2021,
+which contains an explanatory paragraph regarding substantial doubt about the Company s ability to continue as a going concern appearing
+elsewhere herein.
+
+ 
+
+ 
+
+ 
+
+ 35 
+
+ 
+
+ 
+
+ 
+
+LEGAL MATTERS
+
+ 
+
+RULE 144 SHARES
+
+ 
+
+Currently, none of our securities may be resold
+pursuant to Rule 144.
+
+ 
+
+The securities sold in this offering can only
+be resold through registration under Section 5 of the Securities Act of 1933, Section 4(1), if available, for non-affiliates or by meeting
+the conditions of Rule 144(i). A holder of our securities may not rely on the safe harbor from being deemed statutory underwriter under
+Section 2(11) of the Securities Act, as provided by Rule 144, to resell his or her securities. Form 10 information is, generally
+speaking, the same type of information as we are required to disclose in this Prospectus, but without an offering of securities.
+
+ 
+
+Fletcher A. Robbe, Managing Partner, of
+Fletcher Robbe International Attorneys At Law, 9465 Wilshire Blvd. Suite 300, Beverly Hills CA 90210, frobbe@frobbeintl.com, and
+a member of Dalrada Financial Corporation s Board of Directors, has opined on the validity of the shares of common stock being
+offered hereby.
+
+ 
+
+Instruction 1 to Item 509 of Regulation S-K requires
+disclosing whether the interest of any expert or counsel named in the Prospectus exceeds $50,000. The interest of any expert or counsel
+named in the Prospectus does not exceed $50,000 according to Instruction 1 Item 509 of Regulation S-K.
+
+ 
+
+ 
+
+ 
+
+ 36 
+
+ 
+
+ 
+
+ 
+
+ 
+
+DESCRIPTION OF OUR BUSINESS
+
+ 
+
+Company Overview
+
+ 
+
+Dalrada Financial Corporation, ( Dalrada ),
+was incorporated in September 1982 under the laws of the State of California and reincorporated in May 1983 under the laws of the State
+of Delaware and reincorporated on May 5, 2020 under the laws of the state of Wyoming, trades under the symbol, OTCQB: DFCO.
+
+ 
+
+Dalrada, through its wholly-owned subsidiaries,
+Dalrada Health, Dalrada Precision, Dalrada Energy, and Dalrada Technologies, has set forth a company mandate focused and dedicated to
+identifying, addressing and solving real-world global problems by means of development and acquisition of companies and products producing
+innovation-focused and technologically centered solutions on a global scale. Each of these subsidiaries and their operating divisions
+are positioned to service the world s top three growing industries over the next three decades: clean energy, healthcare, and technology.
+In a complex new world, consumers, businesses, and governments are seeking just-in-time solutions with expectations of high-quality and
+exceptional service. Dalrada Corporation responds with affordable, accessible, and impactful products & services that help people,
+businesses, and the planet.
+
+ 
+
+Dalrada Health Products 
+
+ 
+
+Dalrada Health services a growing and overwhelmed
+healthcare system, and offers diagnostic, wellness, and rejuvenation solutions.
+
+ 
+
+Empower Genomics and Pala Diagnostics.
+Pala Diagnostics are Empower Genomics provide genomics testing including COVID-19. Our on-site testing is designed to keep communities
+safe and healthy by providing gold-standard professional diagnostics with no out-of-pocket cost in many cases.
+
+ 
+
+Solas Rejuvenation + Wellness.
+Through advanced medical techniques and modern technology, S lasRejuvenation + Wellness delivers a clinical experience that helps
+a myriad of health and wellness solutions.
+
+ 
+
+International Health Group ( IHG ).
+IHG is a provider of Medical Assistant programs including CNA and HHA training. IHG s unique curriculum allows for a 22-day
+fast track CAN Certification Program.
+
+ 
+
+Glanhealth. Glanhealth is a
+cleaning solution provider which uses electrostatic machines to spray and deodorize residential spaces, healthcare facilities, hospitality,
+transportation, manufacturing, automotive, schools/education systems, and other facilities requiring cleaning services. Glanhealth s
+products include alcohol-free hand sanitizers, surface cleaners, laundry aides, antimicrobial solutions, electrostatic sprayers, face
+masks, gloves, kits, and delivery equipment such as dispensers, stands, and ease of use packaging for the end consumer. GlanHealth leverages
+an extensive supply chain of producers, resellers, distributors, vendors, and formulators for the development, sale, and marketing of
+its products and services.
+
+ 
+
+Dalrada Precision Corporation
+
+ 
+
+Dalrada Precision is focused on the acquisition
+of companies and development of products that allow for design, engineering, manufacturing, and distribution on a global scale. Dalrada
+Precision helps realize ideas from concept and delivery to after sales service, offering unique and specific solutions. At all levels
+and all verticals of its operations, Dalrada Precision s mandate is the development of products that lessen the burden on engineering
+design, manufacturing processes, regulatory demands, cost, and distribution.
+
+ 
+
+Likido Ltd. Likido is an international
+technology company, developing advanced solutions for the harvesting and recycling of energy. Using its novel, heat pump systems (patent
+pending) and use of supercritical CO2, Likido is working to revolutionize the renewable energy sector with the provision of
+innovative modular process technologies to maximize the capture and reuse of thermal energy for integrated heating and cooling applications.
+With uses across industrial, commercial and residential sectors, Likido provides cost savings and the minimized carbon emissions across
+global supply chains. Likido's technologies enable the effective recovery and recycling of process energy, mitigating against climate
+change and enhancing quality of life through the provision of low-carbon heating and cooling systems.
+
+ 
+
+ 
+
+ 37 
+
+ 
+
+ 
+
+ 
+
+Dalrada Precision Parts. Dalrada
+Precision Parts represents advanced technology and manufacturing. By providing access to the finest components in the global marketplace
+through exclusive manufacturing opportunities and effective global supply chains, Dalrada Precision delivers supreme value and reduces
+cost and time to market. Our products are rigorously-tested for performance as well as compliance. With in-house capabilities,
+we design, produce, and supply precision parts and assembly parts to original equipment manufacturer (OEM) standards, resulting in significant
+cost savings for our clients. At all levels and all verticals of operations, Dalrada Precision s mandate is the development
+of products that lessen the burden on engineering design, manufacturing processes, regulatory demands, cost, and distribution.
+
+ 
+
+Ignite I.T. Corp. Ignite represents
+a revolutionary brand of cleaners and degreasers ideal for industrial and commercial applications as well as consumer use. Eco-friendly
+and developed for all surfaces suitable for water, Ignite products are non-flammable, non-corrosive, non-toxic, butyl-free, water-based,
+and leave a light citrus scent. These deep cleaners and degreasers are specially-formulated to lift hydrocarbon-based dirt and grease
+from virtually all surfaces with minimal effort and rinsing and they meet or exceed the most stringent industry-testing specifications.
+Ignite products are available in dilutable concentrates as well as bulk quantities and are ready to use in convenient wipes. They feature
+non-hazardous formulas ideal for a wide range of uses including industrial maintenance, machining, mining, automotive manufacturing, and
+printing.
+
+ 
+
+Dalrada Energy
+
+ 
+
+Dalrada Energy Services provide end-to-end comprehensive
+energy service solutions in a robust commercial capacity. These solutions address unmet energy savings for clients and aid in the growing
+needs of conducting business in an environmentally-friendly fashion while correcting potential issues to maximize energy-saving and cost-saving
+efforts.
+
+ 
+
+Dalrada Energy Services, Inc. Dalrada Energy Services
+provides onsite energy consumption analysis, equipment installation, and ongoing digitalization of energy usage with the result of securing
+financial and emission savings for the end-customer. The company leverages 30+ years of industry experience, advanced operational
+models, and an a robust technology platform to retrofit inefficient equipment and drive energy savings.
+
+ 
+
+Dalrada Technologies
+
+ 
+
+Dalrada Technologies was formed for the purpose
+of acquiring and investing in various global technology related initiatives. Dalrada Technologies is focused on the creation, development,
+and acquisition of innovative and intelligent technologies, including platform services, software engineering services, technology consulting,
+and AI based solutions.
+
+ 
+
+Prakat Solutions Inc. Prakat
+provides global customers with software and technology solutions specializing in Test Engineering, Accessibility Engineering, Product
+Engineering and Application Modernization. The Prakat India team provides end to end Product Engineering services across various domains,
+including Banking & Financial Services, Telecom, Retail, Healthcare, Manufacturing, Legal and IT Infrastructure. Prakat India
+is an ISO 9001 Certified Company.
+
+ 
+
+Competition
+
+ 
+
+We are a diversified global clean energy, engineering,
+healthcare, and technology company. We manage the business in three vertically integrated, product & service focused segments: (i) Healthcare
+products, (ii) Design, Engineering, Manufacturing and Distribution Solutions, and (iii) Global Technology in the form of software
+and various types of equipment. The Company via its operating subsidiaries, acquires, markets, designs, manufactures and/or distributes
+its products globally in the North America, Europe, Middle East & Africa, Latin America and Asia-Pacific regions through a variety
+of trade channels, including retailers, wholesalers and distributors, original equipment manufacturers ( OEMs ) and direct
+to consumer. We are building strong name recognition in our regions under our various brands and products and technologies across multiple
+product categories. Geographic strategic initiatives and financial objectives are determined at the segment level. Each segment is responsible
+for implementing defined strategic initiatives and achieving certain financial objectives and has a president, business leader, or general
+manager responsible for sales, marketing, and fulfillment initiatives and the financial results for all product lines or services within
+that segment.
+
+ 
+
+The three main industries in which we operate
+each have various verticals. Each industry and its verticals operate in a highly competitive global environment with many competitors
+in each industry and vertical. There are a wide variety of companies providing similar services, from companies having long history,
+to companies with many branches. The vast majority of our competitors have greater resources than we do or may offer a broader range of
+products and services than we do. We believe that we compete on the basis of a number of factors, including breadth of the high-quality
+service and product offerings, one stop convenience, pricing, a building brand name and reputation for quality and dependability. 
+Our unique differentiator is the broad portfolio of businesses covering clean energy, healthcare, and technology. These three industry
+sectors are expected to experience the highest CAGR (compound annual growth rate) over the next three decades. 
+
+ 
+
+ 
+
+ 38 
+
+ 
+
+ 
+
+ 
+
+Future plan
+
+ 
+
+In the future, we plan to expand and grow both organically as well
+as through key acquisition.
+
+ 
+
+Research and Development
+
+ 
+
+We spend approximately $520,000 and $470,000
+on research and development activities during the fiscal years ending June 30, 2021 and 2020 respectively. We anticipate that we will
+incur additional expenses on research and development over the next 12 months. Our planned expenditures on our operations or a business
+combination are summarized under the section of this annual report entitled Management s Discussion and Analysis of Financial
+Position and Results of Operations .
+
+ 
+
+Description of Property
+
+ 
+
+Dalrada leases space at 600 La Terraza Blvd.,
+Escondido, California 92025. On May 1, 2020, the Company, entered into a five-year lease agreement.
+
+ 
+
+In May 2020, the Company entered into three-year
+lease agreement to lease a warehouse in Brownsville, Texas.
+
+ 
+
+The Company s Prakat subsidiary entered
+into a lease agreement to lease office space through September 2026.
+
+ 
+
+In August 2020, the Company s Likido subsidiary
+entered in a new operating agreement for warehouse space. The lease matures in July 2021.
+
+ 
+
+In June 2017, the Company s IHG subsidiary
+entered into a lease for 3 separate office suites in San Diego, California. The lease expires in January 2022.
+
+ 
+
+In May 2021, the Company s PSC subsidiary
+entered into a three year and 6-month lease agreement to lease a medical office space in Poway, California.
+
+ 
+
+Legal Proceedings
+
+ 
+
+From time to time and in the course of business,
+we may become involved in various legal proceedings seeking monetary damages and other relief. The amount of the ultimate liability, if
+any, from such claims cannot be determined. As of the date of this filing, there were no legal claims currently pending or threatened
+against us that in the opinion of Management would be likely to have a material adverse effect on our financial position, results of operations
+or cash flows.
+
+ 
+
+Dalrada Financial initiated an action seeking
+judicial relief on December 7, 2021 due to the Minority Member's actions resulting in an unapproved distribution from DFCO's Pala Diagnostics
+division. The judicial matters are presently being consolidated in Orange County, California.
+
+ 
+
+ 
+
+ 
+
+ 39 
+
+ 
+
+ 
+
+ 
+
+MANAGEMENT
+
+ 
+
+Directors, Executive Officers and Key Employees 
+
+ 
+
+The following table sets forth certain information regarding our directors,
+executive officers and key employees as of June 30, 2020 and as of the date of the filing of this report:
+
+ 
+
+ 
+
+ 
+ Name and Address
+ Age
+ Position(s) Held
+
+ 
+ 
+ 
+ 
+
+ 
+ Brian Bonar
+ 74 
+ CEO and Director
+
+ 
+ Fawad Nisar
+ 40
+ COO and Director
+
+ 
+ Kyle McCollum
+ 38
+ CFO and Director
+
+ 
+ Pauline Gourdie
+ 49
+ Director
+
+ 
+ Brian Kendrick
+ 58
+ Director
+
+ 
+ Fletcher A. Robbe
+ 70
+ Director
+
+ 
+ Harvey Hershkowitz
+ 75
+ Director
+
+ 
+ Anthony Zolezzi
+ 67
+ Director
+
+ 
+ Tom Giles
+ 53
+ Director
+
+ 
+ David J. Bacon
+ 54
+ Director
+
+ 
+ Bijan R. Kian (Rafiekian)
+ 69
+ Director
+
+ 
+ Jose Arrieta
+ 40
+ Director
+
+ 
+ Amy Scannell
+ 31
+ Director
+
+ 
+ Vincent Monteparte
+ 58
+ Director
+
+ 
+ 
+
+Background of Directors and Executive Officers
+
+ 
+
+Brian Bonar, CEO and director has over
+16 years with Dalrada Financial Corp. Prior to joining Dalrada, Mr. Bonar worked for more than eighteen years with IBM in the US, Asia,
+and Europe. He has formerly worked at QMS, and Rastek Corporation, The Solvis Group, and was on the Board of Directors of Allegiant Professional
+and Aliance National Insurance Company. Mr. Bonar is also the founder of Bezier Systems.
+
+ 
+
+Mr. Bonar is involved with various private entities
+and has been recognized by the Cambridge Who s Who on several occasions as the executive of the year. In 2012, he
+was recognized as the CEO of the fastest growing public company in Orange County. He is the Chairman of Trucept, Inc. as well as President
+and Chief Executive Officer of various privately held corporations. He is also on the board of American Marine LLC and founded American
+Management Services (AMS) Outsourcing, a PEO-focused company.
+
+ 
+
+Mr. Bonar holds the honorary title, Lord Bonar
+of Wilcrick, Cardiff, Wales United Kingdom. He received a BSC in Mechanical Engineering from the Strathclyde University, Glasgow Scotland
+and an MBA and PHD in the field of International Business Development Studies from the Stafford University, England UK.
+
+ 
+
+Pauline Gourdie, Director - Ms. Gourdie
+is currently the owner/operator of CSL Staffing ( CSL ), which she established in 2016. CSL is a boutique general staffing
+service, providing staffing solutions for businesses in the San Diego and greater Southern California areas. For seven years prior to
+that, Ms. Gourdie was the President/Owner of Gourdie Consulting Corp which provided business consulting services across Americas &
+Europe. Ms. Gourdie possesses over 20 years of experience managing individuals and teams, and was instrumental in the implementation of
+fulfilment and manufacturing centers for IBM and Lenovo in the United States, United Kingdom, Eastern Europe, and China.
+
+ 
+
+Ms. Gourdie holds a Bachelor of Science degree
+in Industrial and Labor Relations from Cornell University and brings to Dalrada an extensive knowledge of supply chain management, customer
+account and relationship management, and recruitment and development. Ms. Gourdie was appointed to the Dalrada board as of July 29, 2019
+and does not receive compensation in her role as a director. 
+
+ 
+
+ 
+
+ 40 
+
+ 
+
+ 
+
+ 
+
+Brian Kendrick, Director Kendrick
+has been the Managing Director of Allegro Jet Management since 2014. Mr. Kendrick has over 30 years of business experience starting with
+a short stint with Burroughs as a computer programmer. Mr. Kendrick developed one of the industry's first systems for tracking owners
+of aircraft throughout the world and managed all aspects from the inspection and purchase of aircraft to delivery. Appointed July 29,
+2019.
+
+ 
+
+Fletcher A. Robbe, Director - As managing
+partner of Fletcher Robbe International Attorneys at Law, Mr. Robbe brings 43 years of international and domestic business and financial
+acumen as well as practical hands on experience to the personal and confidential representation of his clients comprised of Foreign Governments,
+Multi-National Public and Private Corporations, Investment Banking Institutions, Family Offices and Private Wealth Individuals. Mr. Robbe
+previously served as General Counsel for the Los Angeles World Trade Association. Appointed July 29, 2019.
+
+ 
+
+Fawad Nisar, COO and Director Prior
+to COO of Dalrada, Mr. Nisar, in 2019 held the position of Executive Vice President of Marketing of Trucept, Inc. In 2018, Fawad held
+the position of Vice President of Marketing at Isodiol International. From 2014 through 2018, Mr. Nisar held the position of Senior Account
+Director, Healthcare Vertical. Mr. Nisar has held various executive and high-level roles managing global operations as well as sales and
+marketing for large product and service organizations. Graduating with a master s degree in chemical engineering from Manhattan
+College, Nisar began his career working as a biochemical engineer for Wyeth Pharmaceuticals producing one of the first targeted
+chemotherapy drugs to treat acute myeloid leukemia, followed by 14 years of providing business solutions to Fortune 500 pharmaceutical,
+healthcare, manufacturing, and retail businesses.
+
+ 
+
+Harvey Hershkowitz, Director - Mr. Hershkowitz
+for the last five years has been the chairman of the Board for Palomar Hospital. Mr. Hershkowitz has more than 35-years experience
+in the healthcare industry with the top Fortune 10 companies including consulting, Information Technology (IT), software, professional
+services, nursing schools, management, building and development. In addition, he has successfully spearheaded companies in business, IT,
+residential, wellness centers, commercial development, acute care hospitals, skilled nursing facilities, major physician groups, biosciences,
+pharmaceutical and healthcare construction boards. Serving on many boards including being Chairman to many, Mr. Hershkowitz also has a
+notable track record with spring-boarding start-ups, raising capital, and positioning corporations in the global market where he actively
+expands his reach and network.
+
+ 
+
+Anthony Zolezzi is currently the CEO of
+Diomics Inc. as of August 2019, and is on the Board of Directors of TwinLab and Wild Oats Organic Marketplace. Previously, in 2018, Mr.
+Zolezzi was named the CEO of Twinlab Consolidated Holdings, Inc., and appointed to Twinlab s Board of Directors in May, 2018. Mr.
+Zolezzi, for the last six years, is also an operating partner at Pegasus Capital Advisors, a private asset management company focused
+on the wellness sectors. As a serial entrepreneur, Mr. Zolezzi has dedicated his career to the well-being of both people and the planet,
+co-founding businesses that provide potential solutions to both health concerns and key environmental issues as well as focusing on ways
+that biotech breakthroughs can enhance consumer health and wellness. Zolezzi has authored and co-authored six books.
+
+ 
+
+Mr. Zolezzi is a graduate of Loyola Marymount
+University, earned an MBA at San Diego State and completed the Executive Program at the Kellogg School at Northwestern. Zolezzi is a former
+board member of Vitamin Angels, a non-profit focused on providing nutritional support in impoverished countries. He also co-founded and
+is a former board member of the Organic Center for Education and Promotion, and a former member of the Organic Alliance Board of Directors.
+Mr. Zolezzi also serves as an advisory board member with the Menus of Change program, a joint venture between The Culinary Institute of
+America and Harvard T.H.Chan School of Public Health, and the Keurig Corporation.
+
+ 
+
+Tom Giles, since November 2017, is the
+chief Revenue Officer of Corporate Development and Co-founder of WeR.Ai. Prior to WeR.AI., Mr. Giles was the General Partner Healthcare
+at Frost Data Capital from July 2014 to June 2017, the General Manager of Healthcare at Nex Cubed from June 2017 to December 2018, and
+an advisor at ARVDRK Technologies from September 2017 to December 2018. Though the years, Mr. Giles also held high level positions at
+companies such as IBM and Trivium Health Inc. Mr. Giles is currently an adviser to the Boards at the following companies: Trials.ai, Diomics
+Corporation, Narrative Wave, and has been a board member of several other companies.
+
+ 
+
+Mr. Giles' executive management leadership includes
+technology and healthcare industries with a focus on artificial intelligence (AI) and machine learning (ML) to reduce time and expense
+to market. Mr. Giles' accomplishments include raising more than $200 million in capital for startups and venture funds in addition to
+building strategic partnerships with some of the largest global companies including IBM, GE, Accenture, T-Mobile, and DST. He has also
+held industry lead and advisory roles in early-stage ventures and incubators. Mr. Giles holds a Bachelor s degree in Business from
+San Diego State University, California.
+
+ 
+
+ 
+
+ 41 
+
+ 
+
+ 
+
+ 
+
+Dr. David Bacon is currently an active
+Navy CAPTAIN with 22 years of active-duty service. During the SARS-CoV-2 pandemic, Dr. Bacon was responsible for reviewing proposals for
+funding in the areas of therapeutics, diagnostics, and wearable monitors. He reviewed more than 400 proposals and provided his expert
+opinion on the scientific rationale and study design. Dr. Bacon s professional background includes: Former program Area Manager
+for the DoD s HIV and Emerging Infectious Diseases research programs; Science and Technology Program management/program development
+Chemistry Division, Naval Research Laboratory; Deployed as Officer-in-Charge, Kandahar Airfield, Afghanistan and Camp Arifjan, Kuwait;
+Deployed as sole microbiologist aboard USNS Comfort in support of Continuing Promise 2009; Head, Laboratory Sciences, Navy Environmental
+and Preventive Medicine Unit 2, Norfolk, VA; Director, Parasitology Program, Naval Medical Research Unit 6 (NAMRU-6), Lima, Peru, Deputy
+Director, Parasitology Department, NAMRU-6, Lima, Peru; Member of scientific assessment team commissioned by the Iraq Survey Group to
+investigate biological weapons programs in Baghdad, Iraq; Deployed as element commander of a biological weapons detection laboratory,
+Baghdad, Iraq and Principal Investigator, Malaria Program Naval Medical Research Center, Research Area.
+
+ 
+
+Dr. Bacon earned a B.S. from the University of
+New Hampshire (Medical Technology) in May 1990 and a Ph.D. from the University of New Hampshire (Microbiology) in May 1997.
+
+ 
+
+The Honorable Bijan R. Kian, currently
+the Chairman of the Board of Directors of TODAQ USA Corporation since July 2020, as well as the Chairman of the Board of directors of
+Lenders Technology for the last 10 plus years, was twice confirmed by the United States Senate and has served three presidents of the
+United States from both political parties. In 2016, Mr. Kian served as Deputy Lead on the Office of Director of National Intelligence
+for the President Transition Team. Formerly, Mr. Kian served as a Member of the Export-Import Bank of the United States, A Member of the
+White House Business Council, Director of Foreign Investment for the Staten of California and a Senior Fellow for global public policy
+at the United States Naval Postgraduate School and Member of the Board of directors at the National Defense University Foundation. He
+is recognized around the world as a senior executive in global trade and international security.
+
+ 
+
+Mr. Kian is a graduate of the University
+of Brighton, with continuing education at Oxford, Harvard Kennedy School and MIT. A Fellow at the Royal Society of Arts in the United
+Kingdom, Mr. Kian is also the recipient of the Ellis Island Medal of Honor.
+
+ 
+
+Jose Arrieta, is currently with Imagineeer
+LLC, a company he founded when he left Government. Imagineeer is an IT solutions company that currently is focused on fund raising, blockchain
+enabled diagnostic development, cyber security solutions and quantum inspired optimization capabilities. Mr. Arrieta works with Federal
+customers evaluating and valuing venture backed technology starts ups in the health and national security space. Mr. Arrieta currently
+sits on a number of boards and advises 5 technology startups. Imagineeer is also working to build an ecosystem to facilitate secure, autonomous,
+data driven, AI powered science-based organizations Mr. Arrieta is also the former Chief Information Officer and Interim Chief Data Officer
+of HHS. He is a respected leader in applying emerging technologies, especially blockchain, artificial intelligence/machine learning
+and process automation. He oversaw $6.3B in IT investments, $800B in grants and $26B in Federal contracts while at HHS. Mr. Arrieta has
+also published articles on valuing disruptive technology companies and the importance of industry / government communications. Jose led
+the creation / implementation of the largest public health surveillance capability in the United States during the pandemic and the first
+enterprise grade supervised machine learning capability to help more accurately distribute testing supplies and predict hot spots across
+the United States. He created a public private key, distributed ledger infrastructure to establish digital identities for commercial,
+federal, state end points to aid the COVID 19 vaccination and testing efforts. He created and teaches the first blockchain course (blockchain
+and cryptos) at the Johns Hopkins University as well as entrepreneurial finance.
+
+ 
+
+Kyle McCollum, is current the Chief Financial
+Officer of the company. Prior to that, Mr. McCollum was with Better Choice Company Inc. (ticker: BTTR) for three years where Mr. McCollum
+acted as Corporate Secretary and SVP of Corporate Finance.
+
+ 
+
+In 2018, Mr. McCollum helped form Bona Vida, a
+pet CBD company, were he served as Chief Financial Officer. In May 2019, Bona Vida merged into Better Choice Company Inc., a publicly
+listed pet health and wellness company (ticker: BTTR), where Mr. McCollum acted as Corporate Secretary and SVP of Corporate Finance. With
+Better Choice Company, he assisted in the merger of Bona Vida and TruPet with Better Choice Company as well as the acquisition of Halo
+Purely for Pets. Mr. McCollum also guided several 10-Q s and its 2019 10-K with audit.
+
+ 
+
+ 
+
+ 42 
+
+ 
+
+ 
+
+ 
+
+From 2013 to 2017 Mr. McCollum was Chief Financial
+Officer of Das & Co., a New York based family office. At Das & Co. Mr. McCollum managed all accounting, tax, audit, portfolio
+valuation, asset management, financial/investment reporting, and operations for Landmark Banyan Real Estate Fund, a US$200 million India
+Real Estate Fund comprised of over 10 developments. Mr. McCollum was also Chief Operating Officer of all Das & Co. s holding
+and operating subsidiaries including Apex Resources, its mining company in Tanzania, and LDC Developers, its real estate development company.
+
+ 
+
+Mr. McCollum has also served as Director of Finance
+at 29th Street Capital, a California based real estate investment firm with a publicly stated asset value base of US $500 million. Prior
+to 29th Street Capital, Mr. McCollum was Director of Finance and Corporate Compliance at Fletcher Robbe International Attorneys at Law,
+an international transactional and securities-based law firm with offices in Century City, New York, Hong Kong and Beijing. While at Fletcher
+Robbe International Attorneys at Law, Mr. McCollum focused on complex finance transactions, mergers & acquisitions, securities and
+guided several foreign listed public companies on international cross-listing to U.S. public exchanges. Mr. McCollum earned a Bachelor s
+of Science and Master of Accountancy degree from the University of Montana and holds a Certified Public Accounting license.
+
+ 
+
+Amy Scannell, is currently General
+Counsel of Tipp Investments, LLC, in Escondido California, since June 2019. Tipp Investments, LLC is a company with broad investment interests
+including commercial real estate, agriculture, and aviation. Scannell was admitted to the California bar in 2019 and the Massachusetts
+bar in 2015. Prior to Tipp Investments, Scannell worked as an associate attorney for Baskin & Associates, LLC, a family law litigation
+firm in Boston, Massachusetts. Scannell received her Juris Doctorate from Suffolk University Law School in Boston Massachusetts and Bachelor
+of Arts from Westfield State University in Westfield, Massachusetts.
+
+ 
+
+Vincent Monteparte, is currently
+the Principal and Venture Partner in the venture capital and investment banking industry, having managed transactions and investments
+ranging from $40M to $500M. His leadership transformed uniquely positioned mid-market organizations in the enterprise software sector
+to upwards of $2 billion in enterprise valuations. A diverse background in technology, aerospace, transportation, logistics, real estate
+and healthcare has led Mr. Monteparte to roles as Venture Partner at Sway Ventures, a US-based venture capital firm investing in early
+to mid-stage technology companies and Principal at Global Capital Markets, an investment banking firm focusing on mid-market transactions
+for technology, manufacturing, distribution, service and retail companies.
+
+ 
+
+Mr. Monteparte began his career as an entrepreneur
+and founded various companies, most recently Miro Technologies. At Miro, he led the development of a SaaS solution to modernize maintenance,
+repair, overhaul, and supply chain operations for complex assets. The business was sold to Boeing for 14x return on invested capital with
+an IRR of 48%. Additionally, Mr. Monteparte has since held various senior level executive roles leading teams and positioning multinational
+corporations to growth.
+
+ 
+
+Mr. Monteparte holds a series 63 and 79 license
+and Board Advisory positions for BlueSky eLearn, a leading learning management software platform and Measurabl, a global ESG SaaS Software
+company. He received a B.A. in Aeronautical Engineering from Embry-Riddle Aeronautical University and an MBA from the Pepperdine University
+Graziadio School of Business, where he earned the Most Distinguished Alumni Award. In his spare time, Mr. Monteparte co-chairs the Business
+& Entrepreneurship Committee at Pepperdine, where he acts as a mentor to young entrepreneurs and executives in career and portfolios.
+
+ 
+
+Term of Office of Directors
+
+ 
+
+Our directors are appointed for a one-year term
+to hold office until the next annual general meeting of our stockholders or until removed from office in accordance with our bylaws. Our
+officers are appointed by our Board of Directors and hold office until the officer dies or resigns or the Board elects a successor or
+removes the officer.
+
+ 
+
+ 
+
+ 
+
+ 43 
+
+ 
+
+ 
+
+ 
+
+Involvement in Certain Legal Proceedings
+
+ 
+
+To the best of our knowledge, during the past
+five years, none of the following occurred with respect to a present director (or person nominated to become director), executive officer,
+founder, promoter or control person: (1) any bankruptcy petition filed by or against any business of which such person was a general partner
+or executive officer either at the time of the bankruptcy or within two years prior to that time; (2) any conviction in a criminal proceeding
+or being subject to a pending criminal proceeding (excluding traffic violations and other minor offenses); (3) being subject to any order,
+judgment or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction, permanently or temporarily
+enjoining, barring, suspending or otherwise limiting his or her involvement in any type of business, securities or banking activities;
+and (4) being found by a court of competent jurisdiction (in a civil action), the SEC or the Commodities Futures Trading Commission to
+have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended or vacated. 
+
+ 
+
+Code of Ethics
+
+ 
+
+We have adopted a corporate code of ethics. We
+believe our code of ethics is reasonably designed to deter wrongdoing and promote honest and ethical conduct; provide full, fair, accurate,
+timely and understandable disclosure in public reports; comply with applicable laws; ensure prompt internal reporting of code violations;
+and provide accountability for adherence to the code. To the knowledge of the Company, there have been no reported violations of the Code
+of Ethics.
+
+ 
+
+Whistleblower Procedures Policy
+
+ 
+
+In accordance with the requirements of Section
+301 of the Sarbanes-Oxley Act of 2002, the Board of Directors of the Company has adopted a Whistleblower Procedures Policy, stating that
+all employees of the Company are strongly encouraged to report any evidence of financial irregularities which they may become aware of,
+including those with respect to internal controls, accounting or auditing matters. Under the Whistleblower Procedures Policy,
+the management of the Company shall promptly and periodically communicate to all employees with access to accounting, payroll and financial
+information the means by which they may report any such irregularities. In the event an employee is uncomfortable for any reason reporting
+irregularities to his or her supervisor or other management of the Company, employees may report directly to any member of the Board of
+Directors of the Company. The identity of any employee reporting under these procedures will be maintained as confidential at the request
+of the employee, or may be made on an anonymous basis. Notice must be provided to all of the Company s employees with access to
+accounting, payroll and financial information in respect of these procedures.
+
+ 
+
+Director Independence
+
+ 
+
+The OTCQB does not have a requirement that a majority
+of our Board of Directors be independent. However, with respect to the definition of independence utilized by NASDAQ, our officers and
+directors would not be deemed to be independent.
+
+ 
+
+Our Audit Committee is comprised of our officers
+and directors. NASDAQ requires at least three members on the Audit Committee, each of whom must be independent. NASDAQ also requires that,
+if its Chief Executive Officer s compensation is determined by its Compensation Committee, the Compensation Committee must be comprised
+solely of independent directors. The Company currently does not meet either of these requirements.
+
+ 
+
+The NASDAQ rules have both objective tests and
+a subjective test for determining who is an independent director. The objective tests state, for example, that a director
+is not considered independent if he or she is an employee of the Company or is a partner, executive officer or controlling stockholder
+of an entity to which the company made, or from which the Company received, payments in the current or any of the past three fiscal years
+that exceed the greater of $200,000 or 5% of the recipient s consolidated gross revenue for that year or a family member serves
+in the current fiscal year or has served at any time during the last three fiscal years as an executive officer of the Company. The subjective
+test states that an independent director must be a person who lacks a relationship that, in the opinion of the Board, would interfere
+with the exercise of independent judgment in carrying out the responsibilities of a director.
+
+ 
+
+ 
+
+ 44 
+
+ 
+
+ 
+
+ 
+
+Key Employees
+
+ 
+
+Brian Bonar, Dalrada Financial Corp. CEO and director
+for over sixteen years. Prior to joining Dalrada, Mr. Bonar worked for more than eighteen years with IBM in the US, Asia, and Europe.
+He has formerly worked at QMS, and Rastek Corporation, The Solvis Group, and was on the Board of Directors of Allegiant Professional and
+Aliance National Insurance Company. Mr. Bonar is also the founder of Bezier Systems.
+
+ 
+
+David Pickett, Dalrada Precision Corp. President
+| VP, Sales. For over 10 years having designed and manufactured products for the biggest OEM and Fortune 500 companies in the world, his
+knowledge base adds great strength to all our operational and supply chain requirements.
+
+ 
+
+Family Relationships
+
+ 
+
+Pauline Gourdie is the daughter of Brian Bonar.
+
+ 
+
+Audit Committee 
+
+ 
+
+The Board does not currently have a standing Audit
+Committee. The full Board performs the principal functions of the Audit Committee. The full Board monitors our financial reporting process
+and internal control system and reviews and appraises the audit efforts of our independent accountants.
+
+ 
+
+Compensation Committee
+
+ 
+
+The Board does not currently have a standing Compensation
+Committee. The full Board establishes our overall compensation policies and reviews recommendations submitted by our management.
+
+ 
+
+Nominating Committee
+
+ 
+
+The Board does not currently have a standing Nominating
+Committee. We do not maintain a policy for considering nominees. Our Bylaws provides that the number of Directors shall be fixed from
+time to time by the Board, but in no event shall be less than the minimum required by law. The Board of Directors shall be large enough
+to maintain our required expertise but not too large to function efficiently. Director nominees are recommended, reviewed and approved
+by the entire Board.
+
+ 
+
+Section 16(a) Beneficial Ownership Reporting Compliance
+
+ 
+
+Section 16(a) of the Securities Exchange
+Act of 1934, as amended, requires our directors and executive officers, and persons who beneficially own more than 10% of a registered
+class of our equity securities, to file reports of beneficial ownership and changes in the beneficial ownership of our securities with
+the SEC of Forms 3 (Initial Statement of Beneficial Ownership), 4 (Statement of Changes of Beneficial Ownership of Securities) and 5 (Annual
+Statement of Beneficial Ownership of Securities). Directors, executive officers and beneficial owners of more than 10% of our Common Stock
+are required by SEC regulations to furnish us with copies of all Section 16(a) forms that they file. The required filings will be
+made.
+
+ 
+
+ 
+
+ 
+
+ 45 
+
+ 
+
+ 
+
+ 
+
+EXECUTIVE and DIRECTOR COMPENSATION
+
+ 
+
+ SUMMARY COMPENSATION TABLE 
+
+As of Fiscal Year End June 30, 2021
+
+ 
+
+ 
+ Name and Principal Position
+ 
+ Year
+ 
+ Salary
+ 
+ Bonus
+ 
+ Stock
+ 
+ Option
+ 
+ Non-Equity
+ 
+ Change in Pension Value
+ 
+ All Other
+ 
+ Total
+ 
+
+ 
+ 
+ 
+ 
+ 
+ ($)
+ 
+ ($)
+ 
+ Awards
+ 
+ Awards
+ 
+ Incentive
+ 
+ Nonqualified
+ 
+ Compensation
+ 
+ ($)
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ ($)
+ 
+ ($)
+ 
+ Plan
+ 
+ Deferred
+ 
+ ($)
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Compensation
+ 
+ Compensation
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ ($)
+ 
+ Earnings
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ ($)
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Brian Bonar, CEO Director
+ 
+ 2021
+ 
+ 393,000
+ 
+ 0
+ 
+ 40,000
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 433,000
+ 
+
+ 
+ 
+ 
+ 2020
+ 
+ 393,000
+ 
+ 0
+ 
+ 
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 393,000
+ 
+
+ 
+ Fawad Nisar, COO Director
+ 
+ 2021
+ 
+ 318,269
+ 
+ 150,000
+ 
+ 40,000
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 508,269
+ 
+
+ 
+ Kyle McCollum, CFO Director
+ 
+ 2021
+ 
+ 34,615
+ 
+ 0
+ 
+ 0
+ 
+ 60,086
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 94,701
+ 
+
+ 
+ Pauline Gourdie
+ 
+ 2021
+ 
+ 0
+ 
+ 0
+ 
+ 40,000
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 40,000
+ 
+
+ 
+ Brian Kendrick
+ 
+ 2021
+ 
+ 0
+ 
+ 0
+ 
+ 40,000
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 40,000
+ 
+
+ 
+ Fletcher A. Robbe
+ 
+ 2021
+ 
+ 0
+ 
+ 0
+ 
+ 40,000
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 54,862
+ 
+ 94,862
+ 
+
+ 
+ Harvey Hershkowitz
+ 
+ 2021
+ 
+ 0
+ 
+ 0
+ 
+ 40,000
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 65,000
+ 
+ 105,000
+ 
+
+ 
+ Anthony Zolezzi
+ 
+ 2021
+ 
+ 0
+ 
+ 0
+ 
+ 225,000
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 225,000
+ 
+
+ 
+ Tom Giles
+ 
+ 2021
+ 
+ 0
+ 
+ 0
+ 
+ 225,000
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 50,000
+ 
+ 275,000
+ 
+
+ 
+ David J. Bacon
+ 
+ 2021
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 18,000
+ 
+ 18,000
+ 
+
+ 
+ Bijan R. Kian (Rafiekian)
+ 
+ 2021
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+
+ 
+ Jose Arrieta
+ 
+ 2021
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 20,000
+ 
+ 20,000
+ 
+
+ 
+ Amy Scannell
+ 
+ 2021
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+
+ 
+ Vincent Monteparte
+ 
+ 2021
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+
+ 
+ 
+
+ 
+
+OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
+TABLE
+
+ 
+
+ 
+ 
+ 
+ OPTION AWARDS 
+ 
+ STOCK AWARDS
+ 
+
+ 
+ Name and Principal Position(s)
+ 
+ 
+ Number of
+
+ Securities
+
+ Underlying
+
+ Unexercised
+
+ Options
+
+ (#)
+
+ (Exercisable)
+
+ 
+ 
+ Number of
+
+ Securities
+
+ Underlying
+
+ Unexercised
+
+ Options
+
+ (#)
+
+ (Unexercisable)
+
+ 
+ 
+ Equity
+
+ Incentive
+
+ Plan
+
+ Awards:
+
+ Number of
+
+ Securities
+
+ Underlying
+
+ Unexercised
+
+ Unearned
+
+ Options
+
+ (#)
+
+ 
+ 
+ Option
+
+ Exercise
+
+ Price
+
+ ($)
+
+ 
+ 
+ Option
+
+ Expiration
+
+ Date
+
+ 
+ 
+ Number
+
+ of Shares
+
+ or Units
+
+ of Stock
+
+ That Have
+
+ Not
+
+ Vested
+
+ (#)
+
+ 
+ 
+ Market
+
+ Value of
+
+ Shares or
+
+ Units
+
+ of Stock
+
+ That Have
+
+ Not
+
+ Vested
+
+ ($)
+
+ 
+ 
+ Equity
+
+ Incentive
+
+ Plan
+
+ Awards:
+
+ Number
+
+ of
+
+ Unearned
+
+ Shares,
+
+ Units or
+
+ Other
+
+ Rights
+
+ That
+
+ Have Not
+
+ Vested
+
+ (#)
+
+ 
+ 
+ Equity
+
+ Incentive
+
+ Plan
+
+ Awards:
+
+ Market
+
+ or Payout
+
+ Value of
+
+ Unearned
+
+ Shares,
+
+ Units or
+
+ Other
+
+ Rights
+
+ That
+
+ Have Not
+
+ Vested
+
+ ($)
+
+ 
+
+ 
+ Brian Bonar, CEO
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+
+ 
+ Kyle McCollum, CFO
+ 
+ 0
+ 
+ 1,000,000
+ 
+ 1,000,000
+ 
+ $0.47
+ 
+ 
+ 5-10-31
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+ 0
+ 
+
+ 
+ 
+
+ 
+
+ 46 
+
+ 
+
+ 
+
+ 
+
+Option Grants
+
+ 
+
+On May 10, 2021, the Company granted 1,000,000 options to purchase
+common stock to its Chief Financial Officer with an exercise price of $0.47 per share.
+
+ 
+
+Director Compensation
+
+ 
+
+On July 9, 2020 the Board authorized the Dalrada
+Financial Corp 2020 stock compensation plan to be used to compensate the company board of directors. The plan allocates the issuance of
+up to 3,500,000 shares. On February 25, 2021, the Company amended the plan to issue up to 4,500,000 shares and issued an aggregate of
+4,500,000 common shares, or 500,000 shares to each board member (9). 3,500,000 shares of common stock were granted on July 9, 2020 at
+$0.08 per share and 1,000,000 shares of common stock were granted on February 25, 2021 at $0.45 per share, for a total fair value of $730,000,
+which is included in the consolidated statements of operations
+
+ 
+
+On August 16, 2021, the company approved Amendment
+No.1 of the 2020 Stock Compensation Plan used to compensate the company board of directors. The Amended plan allocates the issuance of
+up to 6,500,000 shares which includes an additional 2,000,000 shares valued at $0.28 per shares or $560,000.
+
+ 
+
+On November 9, 2021 the Board approved Amendment
+No. 2 of the 2020 Stock Compensation Plan used to compensate the company board of directors. The Amendment called for the following:
+
+ 
+
+1)Cancellation and return to treasury of all the commons shares issued under the previous 2020 Stock Compensation Plan and amendments
+totaling 6,500,000 shares of common stock.
+
+ 
+
+2)Issue Cashless Warrants for up to 10,000,000 shares of the Company s Common Stock, at $.005 par value per share ( Common
+Stock ) at 500,000 shares per board member, key employees or consultants with an exercise price at $0.45 per common share;
+
+ 
+
+3)The vesting period for the Warrants shall be as follows:
+
+ 
+
+a)Warrants issued to replace the 4,500,000 shares issued pursuant to the July 9, 2020 grant date will be fully vested;
+
+b)Warrants issued to replace the 2,000,00 shares issued pursuant to the July 19, 2021 grant date and any later grant dates will vest
+over a one-year period.
+
+ 
+
+ Employment Agreements
+
+ 
+
+On July 1, 2019, the Company entered into an employment
+agreement with the Chief Executive Officer of the Company. Pursuant to the agreement, the Company will compensate the Chief Executive
+Officer a base salary of $393,000 per annum, annual increases of 10% and a quarterly bonus based on whether the Company achieve a net
+profit. He will be issued common stock of the Company sufficient to provide a 10% ownership position only upon a reverse split, which
+shares are to be maintained for a period of two years. In addition to all other benefits and compensation, he shall be eligible for a
+quarterly bonus of $47,000 based on if the Company achieves a net profit for that quarter.
+
+ 
+
+Report on Repricing of Options
+
+ 
+
+None.
+
+ 
+
+ 
+
+ 
+
+ 47 
+
+ 
+
+ 
+
+ 
+
+Security Ownership of Certain Beneficial Owners and Management and
+Related Stockholder Matters
+
+ 
+
+ The following table provides certain information
+regarding the ownership of our common stock, as of June 30, 2021 and as of the date of the filing of the June 30, 2021 annual report by:
+
+ 
+
+ 
+ 
+ 
+ 
+ each of our executive officers;
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ each director;
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ each person known to us to own more than 5% of our outstanding common stock; and
+
+ 
+ 
+
+ 
+ 
+ 
+ 
+ all of our executive officers and directors act as a group.
+
+ 
+ 
+
+As of December 30, 2021, we had a total of 73,838,662
+shares of common stock issued and outstanding. Except as indicated in footnotes to this table, the persons named in this table have sole
+voting and investment power with respect to all shares of common stock indicated below. Except where noted, the address of all listed
+beneficial owners is in care of our office address.
+
+ 
+
+ 
+ Name and Address of Beneficial Owner
+ 
+ Title of Class
+ 
+ 
+ 
+ Amount and
+
+ Nature of Beneficial
+
+ Ownership
+
+ (1) (#)
+
+ 
+ 
+ Percent of Class
+
+ (2) (%)
+
+ 
+ Brian Bonar, Principal Executive Officer and Director
+ 
+ Common Shares
+ 
+ 
+ 5,856,315
+ 
+ 7.93
+
+ 
+ Fawad Nisar, Chief Operating Officer and Director
+ 
+ Common Shares
+ 
+ 
+ 3,517,000
+ 
+ 4.76
+
+ 
+ Brian Kendrick, Director
+ 
+ Common Shares
+ 
+ 
+ 500,000
+ 
+ 0.68
+
+ 
+ Fletcher Robbe, Director
+ 
+ Common Shares
+ 
+ 
+ 500,000
+ 
+ 0.68
+
+ 
+ Harvey Hershkowitz, Director
+ 
+ Common Shares
+ 
+ 
+ 500,000
+ 
+ 0.68
+
+ 
+ Pauline Gourdie, Director
+ 
+ Common Shares
+ 
+ 
+ 500,000
+ 
+ 0.68
+
+ 
+ Anthony Zolezzi, Director
+ 
+ Common Shares
+ 
+ 
+ 500,000
+ 
+ 0.68
+
+ 
+ Tom Giles, Director
+ 
+ Common Shares
+ 
+ 
+ 500,000
+ 
+ 0.68
+
+ 
+ Kyle McCollum, Chief Financial Officer, Director*
+ 
+ Common Shares
+ 
+ 
+ 500,000
+ 
+ 0.68
+
+ 
+ David J. Bacon, Director*
+ 
+ Common Shares
+ 
+ 
+ 500,000
+ 
+ 0.68
+
+ 
+ Bijan R. Kian (Rafiekian), Director*
+ 
+ Common Shares
+ 
+ 
+ 500,000
+ 
+ 0.68
+
+ 
+ Jose Arrieta, Director*
+ 
+ Common Shares
+ 
+ 
+ 500,000
+ 
+ 0.68
+
+ 
+ Amy Scannell
+ 
+ Common Shares
+ 
+ 
+ 0
+ 
+ 0.00
+
+ 
+ Vincent Monteparte
+ 
+ Common Shares
+ 
+ 
+ 0
+ 
+ 0.00
+
+ 
+ All officers and Directors as a group
+ 
+ Common Shares
+ 
+ 
+ 14,373,315
+ 
+ 10.46
+
+ 
+ 
+
+* The shares for Kyle
+McCollum, David J, Bacon, Bijan R. Kian (Rafiekian), and Jose Arrieta were issued on August 17, 2021
+
+ 
+
+ 
+
+ 
+
+ 48 
+
+ 
+
+ 
+
+ 
+
+Certain
+Relationships, Related Transactions and Director Independence
+
+ 
+
+Notes Payable Related Parties
+
+ 
+
+ 
+ 
+ June 30, 2021 
+
+ 
+ 
+ Outstanding 
+ Accrued 
+
+ 
+ 
+ Principal 
+ Interest 
+
+ 
+ Related entity 1 
+ $2,978,066 
+ $29,875 
+
+ 
+ Related entity 2 
+ 357,025 
+ 5,532 
+
+ 
+ Related entity 3 
+ 3,087,689 
+ 47,728 
+
+ 
+ Related entity 4 
+ 2,789,107 
+ 93,150 
+
+ 
+ Related entity 5 
+ 417,237 
+ 
+
+ 
+ Related entity 6 
+ 879,831 
+ 5,862 
+
+ 
+ 
+ $10,508,955 
+ $182,147 
+
+ 
+
+ 
+
+ 
+ 
+ June 30, 2020 
+
+ 
+ 
+ Outstanding 
+ Accrued 
+
+ 
+ 
+ Principal 
+ Interest 
+
+ 
+ Related entity 1 
+ $740,237 
+ $12,417 
+
+ 
+ Related entity 2 
+ 354,875 
+ 1,176 
+
+ 
+ Related entity 3 
+ 1,887,052 
+ 23,192 
+
+ 
+ Related entity 4 
+ 71,618 
+ 579 
+
+ 
+ 
+ $3,053,782 
+ $37,365 
+
+ 
+
+ 
+
+All notes are unsecured, bear interest at 3% per
+annum, and are due 360 days from the date of issuance, ranging from June 25, 2020 to June 25, 2022. Each entity has significant influence
+or common ownership with the Company s Chief Executive Officer. Several of these notes are in default. The company has not received
+any notices of default or demands for payment.
+
+ 
+
+Convertible Note Payable Related Parties
+
+ 
+
+As of June 30, 2019, the Company issued a convertible
+note for $1,875,000 to the Chief Executive Officer of the Company for compensation. Under the terms of the note, the amount due is unsecured,
+bears interest at 3% per annum, and was due 360 days from the date of issuance. On June 30, 2019, the Company issued note agreement which
+included a conversion feature of the outstanding balance at $0.034 per share. As the conversion price was equal to the fair value of the
+common shares on the date of the agreement, there was no beneficial conversion feature. As of June 30, 2021 the principal balance was
+$1,875,000 and the accrued interest was $112,500.
+
+ 
+
+Related Party Transactions
+
+ 
+
+As of June 30, 2021, and 2020, the Company owed
+$414,073 and $556,317, respectively to related parties for reimbursement of various operating expenses, accrued salaries, management fees,
+etc. which has been recorded in accounts payable and accrued liabilities related parties. As of June 30, 2021 and 2020, this amount
+includes $0 and $7,650 of management fees, which consists of accounting and administrative services to Trucept Inc., a related party company
+controlled by the Chief Executive Officer of the Company. The management fee agreement calls for monthly payments of $7,500. The agreement
+is ongoing until terminated by either party. As of June 30, 2021, amounts included with accounts payable and accrued liabilities 
+related parties for which relate to advances for operating expenses were $1,029,309. In 2021, the Company issued promissory notes totaling
+$879,830 in exchange for conversion of accrued salary to the Chief Executive Officer. As of June 30, 2021, the outstanding principal balance
+of the promissory notes was $879,830 and the accrued interest is $5,862 
+
+ 
+
+ 
+
+ 49 
+
+ 
+
+ 
+
+ 
+
+In November 2019, the Chief Executive Officer
+converted $170 in amounts owed from the Company into 5,000 shares of Series F Super Preferred Stock.
+
+ 
+
+On July 1, 2019, the Company formalized an employment
+agreement with its Chief Executive Officer, which entitles him to compensation of three hundred and ninety-three thousand dollars ($393,000)
+per year. Annual increases will be up to 10% based performance criteria to be determined at a later date. He will be issued common stock
+of the Company sufficient to provide a 10% ownership position post reverse split which shares be maintained for a period of two years.
+In addition to all other benefits and compensation, he shall be eligible for a quarterly bonus of $47,000 based on if the Company achieves
+a net profit for that quarter. As of June 30, 2021 and 2020, the Company had $0 and $556,317, accrued within accounts payable and accrued
+liabilities related parties, respectively. In 2021, the Chief Executive Officer converted $879,830 of accrued salary into a promissory
+note.
+
+ 
+
+In February 2021, the Company issued 500,000 common
+shares to each board member, including the Chief Executive Officer, for an aggregate of 4,500,000 shares. The fair value of $730,000 was
+recorded in the consolidated statements of operations.
+
+ 
+
+The following is a summary of revenues recorded
+by the Company s to related parties with common ownership:
+
+ 
+
+ 
+ 
+ Year Ended 
+
+ 
+ 
+ June 30, 
+
+ 
+ 
+ 2021 
+ 2020 
+
+ 
+ Dalrada Health 
+ $62,607 
+ $124,427 
+
+ 
+ Prakat 
+ 137,500 
+ 99,139 
+
+ 
+ Pacific Stem 
+ 132,550 
+ 
+
+ 
+ 
+ $332,657 
+ $223,566 
+
+ 
+
+ 
+
+ 
+
+ 50 
+
+ 
+
+ 
+
+ 
+
+Management's
+Discussion and Analysis of Financial Condition and Results of Operations
+
+ 
+
+You should read the following discussion and analysis
+in conjunction with our financial statements, including the notes thereto, included in this Report. Some of the information contained
+in this Report may contain forward-looking statements within the meaning of Section 27A of the Securities Exchange Act of 1933, as amended
+(the Act ) and Section 21E of the Securities Exchange Act of 1934, as amended (the Exchange Act ). This information
+may involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to
+be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking
+statements which involve assumptions and describe our future plans, strategies and expectations, are generally identifiable by the use
+of the words may, will, should, expect, anticipate, estimate, 
+ believe, intend or project or the negative of these words or other variations on these words
+or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect, and there can be no assurance
+that the projections included in these forward-looking statements will come to pass. Our actual results could differ materially from those
+expressed or implied by the forward-looking statements as a result of various factors. We undertake no obligation to update publicly any
+forward-looking statements for any reason, even if new information becomes available or other events occur in the future.
+
+ 
+
+Our net loss and limited working capital raise
+substantial doubt about our ability to continue as a going concern. We incurred a net loss of $2,968,298 during the six months ended December
+31, 2021. We will be required to raise substantial capital to fund our capital expenditures, working capital, and other cash requirements
+since our current cash assets are exhausted and we have generated no revenues to date to sustain our operations. We will continue to rely
+on related parties to fund our operations, which may dilute existing share value. We will need to seek other financing to complete our
+business plans. The successful outcome of future financing activities cannot be determined at this time and there are no assurances that,
+if achieved, we will have sufficient funds to execute our intended business plan or generate positive operational results.
+
+ 
+
+In addition to our current deficit, we expect
+to incur additional losses during the foreseeable future. Until we are able to successfully execute our business plan. Consequently, we
+will require substantial additional capital to continue our development and marketing activities. There is no assurance that we will be
+able to obtain additional financing through private placements and/or public offerings necessary to support our working capital requirements.
+To the extent that funds generated from any private placements and/or public offerings are insufficient, we will have to raise additional
+working capital through other sources, such as bank loans and/or financings. No assurance can be given that additional financing will
+be available, or if available, will be on acceptable terms.
+
+ 
+
+We are incurring increased costs as a result of
+being a publicly-traded company. As a public company, we incur significant legal, accounting and other expenses that we did not incur
+as a private company. In addition, the Sarbanes-Oxley Act of 2002, as well as new rules subsequently implemented by the Securities and
+Exchange Commission, have required changes in corporate governance practices of public companies. These new rules and regulations have
+increased our legal and financial compliance costs and have made some activities more time-consuming and costly. For example, as a result
+of becoming a public company, we have created additional board committees and have adopted policies regarding internal controls and disclosure
+controls and procedures. In addition, we have incurred additional costs associated with our public company reporting requirements. In
+addition, these new rules and regulations have made it more difficult and more expensive for us to obtain director and officer liability
+insurance, which we currently cannot afford to do. As a result of the new rules, it may become more difficult for us to attract and retain
+qualified persons to serve on our Board of Directors or as executive officers. We cannot predict or estimate the amount of additional
+costs we may incur as a result of being a public company or the timing of such costs.
+
+ 
+
+RESULTS OF OPERATIONS
+
+ 
+
+Six Months Ended December 31, 2021 and 2020
+
+ 
+
+The following table sets forth the results of
+our operations for the six months ended December 31, 2021 and 2020:
+
+ 
+
+ 
+ 
+ Six Months Ended 
+
+ 
+ 
+ December 31, 
+
+ 
+ 
+ 2021 
+ 2020 
+
+ 
+ Revenues 
+ $10,049,617 
+ $1,214,910 
+
+ 
+ Cost of revenues 
+ 3,260,678 
+ 692,261 
+
+ 
+ Gross profit 
+ 6,788,939 
+ 522,649 
+
+ 
+ Operating expenses 
+ 9,544,335 
+ 3,004,951 
+
+ 
+ Loss from operations 
+ (2,755,396) 
+ (2,482,302)
+
+ 
+ Other income (expenses) 
+ (288,915) 
+ (251,559)
+
+ 
+ Net loss 
+ $(3,044,311) 
+ $(2,733,861)
+
+ 
+
+ 
+
+ 
+
+ 51 
+
+ 
+
+ 
+
+ 
+
+Revenues and Cost of Revenues
+
+ 
+
+During the six months ended December 31, 2021,
+the Company recorded revenues of $10,049,617 as attributable to each entity below:
+
+ 
+
+ 
+ 
+ Six Months Ended 
+
+ 
+ 
+ December 31, 
+
+ 
+ 
+ 2021 
+ 2020 
+
+ 
+ Pala Diagnostics 
+ $7,878,564 
+ $ 
+
+ 
+ Prakat 
+ 1,090,018 
+ 628,306 
+
+ 
+ IHG 
+ 457,551 
+ 
+
+ 
+ Health 
+ 92,078 
+ 188,314 
+
+ 
+ Likido 
+ 150,970 
+ 259,828 
+
+ 
+ Precision 
+ 106,205 
+ 82,685 
+
+ 
+ Other 
+ 274,230 
+ 55,777 
+
+ 
+ 
+ $10,049,617 
+ $1,214,910 
+
+ 
+
+ 
+
+Revenues
+
+ 
+
+Revenues for the six months ended December 31,
+2021 was $10,049,617 compared with revenue of $1,214,910 during the six months ended December 31, 2020, an increase of $8,834,707, or
+727%. The increase in revenues was primarily attributable the Company s COVID-19 testing segment which includes Pala and Empower.
+The Company also increased revenue through its technology segment, supported by Prakat, as well as growth of IHG s educational platform.
+
+ 
+
+Costs and Expenses
+
+ 
+
+Cost of Revenues. Cost of Revenues for
+the six months ended December 31, 2021 was $3,260,678 compared to cost of revenues of $692,261 during the six months ended December 31,
+2020, an increase of $2,568,417, or 85%. The increase in Cost of Revenues was primarily a result of the COVID-19 testing segment.
+
+ 
+
+Operating Expenses. Operating expenses
+for the six months ended December 31, 2021 was $9,544,335 compared to operating expenses of $3,004,951 during the six months ended December
+31, 2020, an increase of 6,539,384, or 218%. The increase in operating expenses was a result of corporate expansion, stock-based compensation,
+and growth of the COVID-19 testing segment. Most of fiscal 2020 s operating expenses were spent on development of the Company s
+proposed business operations. During the six months ended December 31, 2021, the Company recorded stock compensation expense of $1,783,094
+to employees, executives and the Board of Directors.
+
+ 
+
+Other Income (Expense)
+
+ 
+
+Other income (expense) consists of penalties and
+interest within interest expense on the consolidated statements of operations.
+
+ 
+
+Net Income (Loss)
+
+ 
+
+Net loss for the six months ended December 31,
+2021 was $3,044,311 compared to net loss of $2,733,861 for the six months ended December 31, 2020.
+
+ 
+
+ 
+
+ 
+
+ 52 
+
+ 
+
+ 
+
+ 
+
+RESULTS OF OPERATIONS
+
+ 
+
+July 1, 2020 through June 30, 2021 compared to July 1, 2019 through
+June 30, 2020
+
+ 
+
+The following table sets forth the results of
+our operations for the years ended June 30, 2021 and 2020:
+
+ 
+
+ 
+ 
+ Year Ended 
+
+ 
+ 
+ June 30, 
+
+ 
+ 
+ 2021 
+ 2020 
+
+ 
+ Revenues 
+ $3,406,684 
+ $1,178,154 
+
+ 
+ Cost of revenues 
+ 2,471,966 
+ 625,916 
+
+ 
+ Gross profit 
+ 934,718 
+ 552,238 
+
+ 
+ Operating expenses 
+ 9,504,869 
+ 3,241,335 
+
+ 
+ Loss from operations 
+ (8,570,151) 
+ (2,689,097)
+
+ 
+ Other income (expenses) 
+ 8,571,372 
+ 211,540 
+
+ 
+ Net income (loss) 
+ $1,221 
+ $(2,477,557)
+
+ 
+
+ 
+
+Revenues and Cost of Revenues
+
+ 
+
+Revenues as attributable to each entity were as
+follows:
+
+ 
+
+ 
+ 
+ Year Ended 
+
+ 
+ 
+ June 30, 
+
+ 
+ 
+ 2021 
+ 2020 
+
+ 
+ Prakat 
+ $1,185,981 
+ $586,780 
+
+ 
+ Precision 
+ 150,060 
+ 146,887 
+
+ 
+ Pacific Stem 
+ 652,130 
+ 
+
+ 
+ Health 
+ 514,005 
+ 407,069 
+
+ 
+ Likido 
+ 331,254 
+ 
+
+ 
+ IHG 
+ 452,246 
+ 
+
+ 
+ Shark 
+ 121,008 
+ 37,418 
+
+ 
+ 
+ $3,406,684 
+ $1,178,154 
+
+ 
+
+ 
+
+The acquisition of Prakat occurred in January
+2020, and revenue was generated from the date of acquisition until June 30, 2020, whereas for fiscal 2021, revenue was recorded for an
+entire fiscal year. Dalrada Health s sales activity picked up in 2020 when the Company acquired Shark Technologies and launched
+its GlanHealth product line. The acquisition of Shark Technologies occurred in March of 2020, and revenue was generated from the date
+of acquisition until June 30, 2020, whereas for fiscal 2021, revenue was recorded for an entire fiscal year. Likido s revenue increased
+during 2021 as it was primarily an R&D entity during fiscal 2020.
+
+ 
+
+Operating Expenses 
+
+ 
+
+Operating expenses for the year ended June 30,
+2021 was $9,504,869 compared to operating expenses of $3,241,335 during the year ended June 30, 2020, an increase of $6,263,534. The increase
+in operating expenses was due to an increase in the operating activity as most of fiscal 2020 was spent on the continuing development
+of the Company s proposed business operations. The increase was also partially attributable to non-cash stock compensation, the
+continued development and commercialization of the Likido operation and new business units.
+
+ 
+
+ 
+
+ 53 
+
+ 
+
+ 
+
+ 
+
+Other Income (Expense)
+
+ 
+
+During the years ended June 30, 2021 and 2020,
+the Company recognized $670,272 and $768,361, respectively, of penalties and interest within interest expense on the consolidated statements
+of operations. For years ended June 30, 2021 and 2020, the Company recognized $9,504,041 and $1,229,199, respectively, within Gain
+on expiration of accrued payroll taxes as a result of quarterly tax liabilities that expired during the fiscal years.
+
+ 
+
+Net Income (Loss)
+
+ 
+
+Net income for the year ended June 30, 2021 was
+$1,221 compared to a net loss of $2,477,557 during the year ended June 30, 2020.
+
+ 
+
+Liquidity and Capital Resources 
+
+ 
+
+As of December 31, 2021, the Company had an accumulated
+deficit of $112,989,191. The Company continues to incur significant losses and raises substantial doubt regarding the Company s
+ability to continue as a going concern. Cash presently on hand is immaterial. We anticipate needing additional liquidity during the next
+twelve months to fund operations, expand our subsidiaries, expand the growth of the COVID-19 testing segment and continue the commercialization
+of our Likido heating & cooling units. Management is planning to support operations by raising capital, and by accelerating sales
+& marketing efforts of high-margin heating & cooling units, precision parts, our Glanhealth products and COVID-19 testing through
+Pala Diagnostics. The continuation of the Company as a going concern is dependent upon the continued financial support from its management,
+its ability to obtain the necessary debt or equity financing, and generate profitable operations from the Company s planned future
+operations. We will continue to rely on equity sales of our common shares in order to continue to fund our business operations. Issuances
+of additional shares will result in
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/DRTSW_alpha-tau_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/DRTSW_alpha-tau_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..3b0c61919759f673a9d0b65bc892091e33c6213a
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/DRTSW_alpha-tau_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights, and is qualified in its entirety by, the more detailed information included elsewhere in this prospectus. This summary does not contain all of the information that may be important to you. You should read and carefully consider the entire prospectus, especially the Risk Factors section of this prospectus and in our 2021 Annual Report, before deciding to invest in our ordinary shares. Unless the context otherwise requires, we use the terms company, we, us and our in this prospectus to refer to Alpha Tau Medical Ltd. and subsidiaries. We are a clinical-stage oncology therapeutics company focused on harnessing the innate relative biological effectiveness and short range of alpha particles for use as a localized radiation therapy for solid tumors. Our proprietary Alpha DaRT technology is designed to utilize the specific therapeutic properties of alpha particles while aiming to overcome, and even harness for potential benefit, the traditional shortcomings of alpha radiation s limited range. We believe that our Alpha DaRT technology has the potential to be broadly applicable across multiple targets and tumor types. We evaluated the feasibility, safety and efficacy of the Alpha DaRT technology in a first-in-human study of locally advanced and recurrent squamous cell carcinoma, or SCC, cancers of the skin and head and neck. Efficacy was evaluated in 28 tumors, and results showed that Alpha DaRT achieved 100% overall response rate and over 78% complete response rate. The Alpha DaRT was generally well-tolerated, with limited local toxicity and no systemic toxicity. On the basis of this clinical trial as well as some of our additional clinical trials, we received marketing approval in Israel in August 2020 for the treatment of SCC of the skin or oral cavity using the Alpha DaRT in August 2020. In June 2021, the FDA granted the Alpha DaRT Breakthrough Device Designation for the treatment of patients with SCC of the skin or oral cavity without curative standard of care. In October 2021, the FDA granted the Alpha DaRT a second Breakthrough Device Designation, in treating recurrent Glioblastoma Multiforme, or GBM, as an adjunct to standard medical therapies or as a standalone therapy after standard medical therapies have been exhausted. If approved, we expect to market our Alpha DaRT technology first in the United States before other markets, including Israel, notwithstanding the existing marketing authorization in Israel (under which we have not yet commercialized the product). To support our U.S. strategy, we are conducting a multi-center pilot feasibility trial to explore the feasibility of delivering radiotherapy for malignant skin and superficial soft tissue tumors using Alpha DaRT at Memorial Sloan Kettering Cancer Center and up to five other clinical sites around the United States. All ten patients in this trial were treated in the second half of 2021. The study met its primary feasibility endpoint, as all patients had successful delivery of radiation by Alpha DaRT. At approximately 12 weeks, all ten lesions treated demonstrated a complete response to the treatment, with no product-related serious adverse events observed. We hold exclusive rights to our proprietary Alpha DaRT technology in our core markets, including the United States and Europe. While local radiation therapy has been a mainstay of cancer therapy for years, it has been mostly limited to modalities utilizing beta or gamma emissions, which primarily destroy cells through an indirect mechanism relying on oxygen and the generation of free radicals to cause single-strand DNA breaks. By contrast, alpha radiation has hundreds of times the linear energy transfer rate of beta-emitters. Additionally, alpha particles heavier mass and far shorter particle paths (less than 100 m) relative to beta s lighter mass and lengthier (up to 12 mm) path, have been shown to destroy radioresistant cells in clinical studies causing multiple, irreparable, double-strand DNA breaks and other cellular damage upon direct impact within a very short distance. Accordingly, we believe that alpha radiation has several significant potential advantages for use in cancer radiotherapy, including a high relative biological efficiency (potentially enabling it to destroy tumor cells with administration of lower levels of radiation), imperviousness to factors such as hypoxia, and a very well- defined range of travel with limited collateral damage. Nonetheless, its use has also been limited precisely due to alpha s extremely short particle range in living tissue, as the range of less than 100 m is insufficient to provide meaningful clinical utility. The Alpha DaRT technology employs a series of radioactive sources that are embedded with Radium- 224 to enable a controlled, intratumoral release of alpha-emitting atoms which diffuse and decay throughout the tumor, seeking to kill cancerous cells with localized precision, while penetrating deeper into the tumor than can otherwise be reached by the limited ranges of the alpha particles themselves. Due to the inherent limited range of the alpha particles, we believe that the Alpha DaRT technology has the potential to deliver powerful and localized precise killing impact to the tumor without damage to surrounding TABLE OF CONTENTS The information in this proxy statement/prospectus is not complete and may be changed. Alpha Tau Medical Ltd. may not sell these securities until the registration statement filed with the Securities and Exchange Commission, of which this proxy statement/prospectus is a part, is effective. This proxy statement/prospectus is neither an offer to sell these securities, nor a solicitation of an offer to buy these securities, in any state or jurisdiction where the offer or sale is not permitted. Any representation to the contrary is a criminal offense. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED MAY 3, 2022 PRIMARY OFFERING OF 15,771,732 ORDINARY SHARES SECONDARY OFFERING OF 9,251,006 ORDINARY SHARES, ALPHA TAU MEDICAL LTD. This prospectus relates to the issuance from time to time by Alpha Tau Medical Ltd., a company organized under the laws of the State of Israel ( we, our, the Company or Alpha Tau ) of up to 15,771,732 ordinary shares, no par value per share (the ordinary shares ), including (a) 13,629,732 ordinary shares issuable upon the exercise of warrants of the Company that were issued in exchange for the public warrants of Healthcare Capital Corp., a Delaware corporation ( HCCC ) (the public warrants ), at the closing of the Business Combination (as defined herein), following exercise of a total of 120,268 public warrants as of May 2, 2022, and (b) 2,142,000 ordinary shares issuable upon the exercise of the warrants that were issued in exchange for the private warrants of HCCC (the private warrants and, together with the public warrants, the warrants ) at the closing of the Business Combination. The public warrants of HCCC were originally issued in the initial public offering of units of HCCC at a price of $10 per unit, with each unit consisting of one share of Class A common stock of HCCC (the HCCC Class A Shares ) and one half of one warrant of HCCC. The private warrants of HCCC were originally issued in a private placement at a price of $1.00 per warrant in connection with the initial public offering of HCCC. This prospectus also relates to the resale, from time to time, by the selling securityholders named herein (the Selling Securityholders ), or their pledgees, donees, transferees, or other successors in interest, of up to 9,251,006 ordinary shares (the PIPE Shares ) issued to certain of the Selling Securityholders in a private placement that closed in connection with the Business Combination, at an issuance price of $10 per ordinary share, as described below. Each warrant entitles the holder to purchase one ordinary share at an exercise price of $11.50 per share commencing on April 6, 2022 and will expire on March 7, 2027, at 5:00 p.m., New York City time, or earlier upon redemption of the public warrants or liquidation of the Company. We may redeem the outstanding public warrants at a price of $0.01 per warrant if the last reported sales price of our ordinary shares equals or exceeds $18.00 per ordinary share (subject to adjustment in accordance with the terms of the public warrants) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders, as described herein. The private warrants have terms and provisions that are identical to those of the public warrants, except as described herein. We are registering the PIPE Shares for resale by the Selling Securityholders named in this prospectus, or their transferees, pledgees, donees or assignees or other successors-in-interest that receive any of the shares as a gift, distribution, or other non-sale related transfer. We are registering the offer and sale of the PIPE Shares to satisfy certain registration rights we have granted. The Selling Securityholders may offer and sell the PIPE Shares from time to time at fixed prices, at market prices or at negotiated prices, and may engage a broker, dealer or underwriter to sell the securities. In connection with any sales of the PIPE Shares offered hereunder, the Selling Securityholders, any underwriters, agents, brokers or dealers participating in such sales may be deemed to be underwriters within the meaning of the Securities Act. For additional information on the possible methods of sale that may be used by the Selling Securityholders, you should refer to the section entitled Plan of Distribution elsewhere in this prospectus. We do not know when or in what amounts the Selling Securityholders may offer the securities for sale. The Selling Securityholders may sell any, all or none of the PIPE Shares offered by this prospectus. All of the PIPE Shares offered by the Selling Securityholders pursuant to this prospectus will be sold by the Selling Securityholders for their respective accounts. We will not receive any proceeds from the sale of any PIPE Shares by the Selling Securityholders. We will receive up to an aggregate of $181,374,918 from the exercise of the warrants, assuming the exercise in full of all the warrants for cash and not including the approximately $1.4 million we have previously received upon exercise of 120,268 of the public warrants prior to the date of this prospectus). If the warrants are exercised pursuant to a cashless exercise feature, we will not receive any cash from these exercises. We expect to use the net proceeds from the exercise of the warrants, if any, for general corporate purposes. We believe the likelihood that warrant holders will exercise their warrants, and therefore the amount of cash proceeds that we would receive, is dependent upon the market price of our ordinary shares. If the market price for our ordinary shares is less than $11.50 per share, we believe warrant holders will be unlikely to exercise their Warrants. We will pay certain expenses associated with the registration of the securities covered by this prospectus, as described in the section entitled Plan of Distribution. Our ordinary shares and warrants are listed on the Nasdaq Stock Market LLC under the trading symbols DRTS and DRTSW, respectively. On May 2, 2022, the closing prices for our ordinary shares and warrants on the Nasdaq Stock Market LLC were $9.00 per ordinary share and $0.5264 per warrant. Prior to the special meeting of HCCC in connection with the Business Combination, holders of 26,345,782 HCCC Class A Shares exercised their right to redeem those shares for cash at a price of $10.00 per share, for an aggregate of $263,457,820, which represented approximately 95.8% of the total HCCC Class A Shares then outstanding. The ordinary shares being offered for resale in this prospectus represents a substantial percentage of our total outstanding ordinary shares as of the date of this prospectus. Additionally, if all the warrants are exercised, the holders of such warrants would own an additional 15,771,732 ordinary shares, which would then represent 18.7% of our total ordinary shares outstanding following such exercise. The sale of all the securities being offered in this prospectus could result in a significant decline in the public trading price of our ordinary shares. Despite such a decline in the public trading price, the Selling Securityholders and warrant holders may still experience a positive rate of return on the securities they purchased due to the differences in the purchase prices of which they purchased the ordinary shares and the warrants described above. We may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read this entire prospectus and any amendments or supplements carefully before you make your investment decision. We are an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012, or JOBS Act, and are subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 9 of this prospectus and other risk factors contained in the documents incorporated by reference herein for a discussion of information that should be considered in connection with an investment in our securities. Neither the Securities and Exchange Commission, the Israeli Securities Authority nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. TABLE OF CONTENTS ABOUT THIS PROSPECTUS This prospectus is part of a registration statement on Form F-1 filed with the Securities Exchange Commission, or the SEC. The Selling Securityholders named in this prospectus may, from time to time, sell the securities described in this prospectus in one or more offerings. This prospectus and the documents incorporated by reference herein include important information about us, the ordinary shares being issued by us, the securities being offered by the Selling Securityholders and other information you should know before investing. Any prospectus supplement may also add, update, or change information in this prospectus. If there is any inconsistency between the information contained in this prospectus and any prospectus supplement, you should rely on the information contained in that particular prospectus supplement. This prospectus does not contain all of the information provided in the registration statement that we filed with the SEC. You should read this prospectus together with the additional information about us described in the section below entitled Where You Can Find More Information; Incorporation of Information by Reference. You should rely only on information contained in, or incorporated by reference into, this prospectus. We have not, and the Selling Securityholders have not, authorized anyone to provide you with information different from that contained in, or incorporated by reference into, this prospectus. The information contained in this prospectus is accurate only as of the date on the front cover of the prospectus and information we have incorporated by reference in this prospectus is accurate only as of the date of the document incorporated by reference. You should not assume that the information contained in, or incorporated by reference into, this prospectus is accurate as of any other date. We and the Selling Securityholders may offer and sell the securities directly to purchasers, through agents selected by us and/or the Selling Securityholders, or to or through underwriters or dealers. A prospectus supplement, if required, may describe the terms of the plan of distribution and set forth the names of any agents, underwriters or dealers involved in the sale of securities. See Plan of Distribution. Unless otherwise indicated, all historical share-based information in this prospectus has been adjusted to give retroactive effect to the Share Split described below. TABLE OF CONTENTS healthy tissue. By combining the innate relative biological effectiveness and short range of alpha particles in a single- use disposable form, we believe that the Alpha DaRT could address tumors that have otherwise demonstrated poor response to radiation therapy or other standards of care, with the potential to apply to a wide range of tumors and clinical settings. We evaluated the feasibility, safety and efficacy of the Alpha DaRT technology in a first-in-human study of locally advanced and recurrent SCC cancers of the skin and head and neck, the results of which were subsequently published in the International Journal for Radiation Oncology, Biology, Physics and which elicited a positive editorial reaction in the same journal. Efficacy was evaluated in 28 tumors of the skin and head and neck, and results showed that Alpha DaRT achieved a >78% complete response rate. The trial was conducted in an elderly (median age = 80.5 years) and largely pre-treated patient population, with 42% of the target lesions, including non-evaluated lesions, having already received radiation therapy. The Alpha DaRT was generally well- tolerated, with limited local toxicity and no systemic toxicity. Following these initial positive results, we substantially expanded its clinical evaluations in later trials to a much wider patient population. Specifically, we initiated follow-on studies at multiple clinical sites in Israel and around the world, to evaluate Alpha DaRT in cancers of the skin, superficial soft tissue, or oral cavity, regardless of cell type, which includes SCC as well as basal cell carcinoma, melanoma, skin metastases, and others. As of February 28, 2022, across our clinical trials involving superficial lesions, i.e. tumors of the skin, head or neck, Alpha DaRTs have been administered to over 100 lesions, with no treatment-related severe adverse events, and in a pooled analysis evaluating those lesions that reached the evaluation endpoint per the treatment protocol of the applicable clinical trial, we have observed an overall response rate of 98%, including a complete response rate of 74%. The supportive data from these first trials also led to the U.S. Food and Drug Administration, or FDA, granting Breakthrough Device Designation to the Alpha DaRT for the treatment of patients with SCC of the skin or oral cavity without curative standard of care. In parallel, we are seeking FDA marketing authorization for other uses for the Alpha DaRT technology in other indications by conducting feasibility studies and then generating potentially registrational data in other indications, such as breast, pancreas and prostate cancers, or applications such as combinations with immunotherapies. We have engaged with a number of prestigious medical and educational institutions and, as of March 31, 2022, have nine clinical studies ongoing worldwide across these two parallel strategies, namely generating data in superficial tumors as well as conducting studies in other indications. Additionally, in our pre-clinical studies, we evaluated the Alpha DaRT on 19 tumor models (both human and mouse). Alpha DaRT sources were observed to have killed multiple types of mouse and human tumors in vivo. The intensity of the killing activity varied between tumor types, and was dependent on the ability of the radioactive atoms to diffuse inside the tumor and on the intrinsic sensitivity of the tissue to DNA damage induced by the radiation, but all tumor types showed responsiveness to Alpha DaRT, i.e., there was no observed resistance. We therefore believe that our technology may potentially be relevant for treatment across a broad range of tumors. We are currently focused on developing the Alpha DaRT for use in a number of potential applications, particularly in refractory or unresectable localized tumors which are not being adequately addressed by standard of care, tumor types with a high unmet need (such as pancreatic adenocarcinoma or glioblastoma multiforme), and metastatic tumors in combination with systemic therapies such as checkpoint inhibitors. We are also investigating the potential of the Alpha DaRT to elicit an immune response as observed in previous pre-clinical data, as well as anecdotal evidence of response from untreated tumors, or abscopal effects, which may have the potential to inhibit or even reduce metastases. Our company was founded in November 2015 by Uzi Sofer, Alpha Tau s Chief Executive Officer and Chairman, along with the inventors of the Alpha DaRT technology including Professor Itzhak Kelson and Professor Yona Keisari of Tel Aviv University, Alpha Tau s Chief Physics Officer and Chief Scientific Officer, respectively. Together, they founded our company with the goal of bringing this innovative technology out of the laboratory and into patients, in order to bring hope to cancer patients around the world. The main address of our principal executive offices is Kiryat HaMada St. 5, Jerusalem, Israel 9777605 and its telephone number is +972 (3) 577-4115. TABLE OF CONTENTS INDUSTRY AND MARKET DATA Unless otherwise indicated, information contained in this prospectus concerning Alpha Tau s industry and the regions in which it operates, including Alpha Tau s general expectations and market position, market opportunity, market share and other management estimates, is based on information obtained from various independent publicly available sources and other industry publications, surveys and forecasts, which Alpha Tau believes to be reliable based upon its management s knowledge of the industry. Alpha Tau assumes liability for the accuracy and completeness of such information to the extent included in this prospectus. Such assumptions and estimates of Alpha Tau s future performance and growth objectives and the future performance of its industry and the markets in which it operates are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those discussed under the headings Risk Factors, Cautionary Statement Regarding Forward-Looking Statements; Market, Ranking and Other Industry Data in this prospectus and in the headings Risk Factors and Operating and Financial Review and Prospectus in our Annual Report on Form 20-F for the year ended December 31, 2021, or our 2021 Annual Report, incorporated by reference into this prospectus. TABLE OF CONTENTS Recent Developments On March 7, 2022 (the Closing Date ), we consummated the previously announced business combination (the Business Combination ) pursuant to the Agreement and Plan of Merger, dated July 7, 2021 (the Merger Agreement ), by and among the Company, Healthcare Capital Corp., a Delaware corporation ( HCC ) and Archery Merger Sub Inc., a Delaware corporation and wholly owned subsidiary of the Company ( Merger Sub ). Pursuant to the Merger Agreement, Merger Sub will merge with and into HCCC, with HCCC surviving (the Business Combination ). On the Closing Date, the following transactions occurred pursuant to the terms of the Merger Agreement: the Company effected the conversion of all of the issued and outstanding preferred shares of Alpha Tau into Alpha Tau ordinary shares, no par value per share ( Alpha Tau ordinary shares ); the Company effected a share split of each Alpha Tau ordinary shares, calculated in accordance with the terms of the Merger Agreement, such that each Alpha Tau ordinary share has a value of $10.00 per share after giving effect to such share split (the Share Split ); the Company adopted Amended and Restated Articles of Association for Alpha Tau Medical Ltd.; Merger Sub merged with and into HCCC (the Merger ), with HCCC being the surviving corporation in the Business Combination and becoming a wholly owned subsidiary of the Company, with the shareholders of HCCC becoming shareholders of the Company; at the effective time of the Business Combination (the Effective Time ), (a) each share of Class A common stock of HCCC, par value $0.0001 per share and (b) each share of Class B common stock of HCCC, par value $0.0001 per share (the Class B common stock ), outstanding immediately prior to the Effective Time (after giving effect to the forfeiture of 4,844,375 shares of Class B common stock by the Sponsor) was exchanged for one Alpha Tau ordinary share; and each warrant of HCCC entitling the holder to purchase one share of HCCC Class A Common Stock per warrant at a price of $11.50 per share outstanding immediately prior to the Effective Time (after giving effect to the forfeiture of 4,658,000 HCCC warrants) was assumed by the Company and converted into a warrant entitling the holder to purchase one Alpha Tau ordinary share ( Alpha Tau warrant ). Our ordinary shares and warrants began trading on The Nasdaq Stock Market LLC on March 8, 2022 under the symbol DRTS and DRTSW, respectively. PIPE Investment On July 7, 2021, we entered into Subscription Agreements, together with a number of subsequent agreements since (each, a Subscription Agreement ) with certain investors (each, a PIPE Investor and collectively, the PIPE Investors ) pursuant to which, among other things, the PIPE Investors agreed to purchase on the Closing Date our ordinary shares at a price equal to $10.00 per share on the terms and subject to the conditions set forth therein for gross proceeds to us of approximately $93.3 million (the PIPE Financing ). In connection with the closing of the Business Combination, we consummated the sale of 9,251,006 ordinary shares for gross proceeds of $92.5 million pursuant to the PIPE Financing, while $820,000 of gross proceeds of the PIPE Financing were not received from a PIPE Investor. Liquidity and Capital Resources We expect our expenses to increase in connection with our ongoing activities, particularly as we continue the research and development for, initiate later stage clinical trials for, and seek further marketing approvals for, our Alpha DaRT technology and other potential future product candidates. In addition, if we obtain further marketing approvals for our Alpha DaRT technology and other potential future product candidates, we expect to incur significant commercialization expenses related to product sales, marketing, manufacturing and distribution. Furthermore, following the closing of the Business Combination, we expect to incur additional costs associated with operating as a public company. Accordingly, we may need to obtain substantial additional funding in connection with our continuing operations. If we are unable to TABLE OF CONTENTS TRADEMARKS, TRADE NAMES AND SERVICE MARKS This document contains references to trademarks, trade names and service marks belonging to other entities. Solely for convenience, trademarks, trade names and service marks referred to in this prospectus may appear without the or TM symbols, but such references are not intended to indicate, in any way, that the applicable licensor will not assert, to the fullest extent under applicable law, its rights to these trademarks and trade names. We do not intend our use or display of other companies trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies. TABLE OF CONTENTS raise capital when needed or on attractive terms, we would be forced to delay, reduce or eliminate our research and development programs or future commercialization efforts. We expect that the proceeds we received from the Business Combination and the PIPE Financing, together with our existing cash and cash equivalents will enable us to fund our operating expenses and capital expenditure requirements for at least two years. We have based this estimate on assumptions that may prove to be wrong, and we may use our available capital resources sooner than we currently expect. Additionally, we will receive the proceeds from any exercise of any warrants in cash. Each warrant entitles the holder thereof to purchase one ordinary share at a price of $11.50 per share. The aggregate amount of proceeds could be up to $181.4 million if all warrants are exercised for cash. We expect to use any such proceeds for general corporate and working capital purposes, which would increase our liquidity, but our ability to fund our operations is not dependent upon receipt of cash proceeds from the exercise of the warrants. We believe the likelihood that warrant holders will exercise their warrants, and therefore the amount of cash proceeds that we would receive, is dependent upon the market price of our ordinary shares. If the market price for our ordinary shares is less than $11.50 per share, we believe warrant holders will be unlikely to exercise their warrants. Summary Risk Factors Investing in our ordinary shares involves substantial risks, and our ability to successfully operate our business and execute our growth plan is subject to numerous risks. You should consider all the information contained in this prospectus in deciding whether to invest in our ordinary shares. In particular, you should consider the risk factors described under Risk Factors beginning on page 9. Such risks include, but are not limited to: We have incurred significant losses since inception and have not generated any revenue to date. We expect to incur losses over the next several years and may not be able to achieve or sustain revenues or profitability in the future; We may need substantial additional funding, and if we are unable to raise capital when needed, we could be forced to delay, reduce or terminate the development of our Alpha DaRT technology or other product discovery and development programs or commercialization efforts; Our limited operating history may make it difficult for you to evaluate the success of our business to date and to assess its future viability; Our approach to the development of our proprietary Alpha DaRT technology represents a novel approach to radiation therapy, which creates significant and potentially unpredictable challenges for us; The commercial success of our Alpha DaRT technology, if authorized for commercial sale or certified, will depend in part upon public perception of radiation therapies, and to a lesser extent, radiopharmaceuticals, and the degree of their market acceptance by physicians, patients, healthcare payors and others in the medical community; The ongoing COVID-19 pandemic could continue to adversely impact our business, including its clinical trials, supply chain and business development activities; The market opportunities for our Alpha DaRT technology may be smaller than it anticipated or may be limited to those patients who are ineligible for or have failed prior treatments. If we encounter difficulties enrolling patients in our clinical trials, our clinical development activities could be delayed or otherwise adversely affected; We currently have no commercial marketing and sales organization and has no experience in marketing products. If we are unable to establish marketing and sales capabilities or enter into agreements with third parties to market and sell our Alpha DaRT technology, if approved for commercial sale, we may not be able to generate product revenue; TABLE OF CONTENTS We currently conduct, and in the future intend to continue conducting, pre-clinical studies, clinical trials for our Alpha DaRT technology outside the United States, and the FDA and similar foreign regulatory authorities may not accept data from such trials; Our Alpha DaRT technology and operations are subject to extensive government regulation and oversight both in the United States and abroad, and our failure to comply with applicable requirements could harm our business; We may not receive, or may be delayed in receiving, the necessary marketing authorizations or certifications for our Alpha DaRT technology or any future products or product candidates, and failure to timely obtain necessary marketing authorizations or certifications for our product candidates would have a material adverse effect on our business; If we do not obtain and maintain international regulatory registrations, marketing authorizations or certifications for any product candidates we develop, we will be unable to market and sell such product candidates outside of the United States; If in the future Alpha DaRT is approved for commercial sale or certified, but we are unable to obtain adequate reimbursement or insurance coverage from third-party payors, we may not be able to generate significant revenue; We may be unable to obtain a sufficient or sufficiently pure supply of radioisotopes to support clinical development or at commercial scale; If we are unable to obtain and maintain patent or other intellectual property protection for our Alpha DaRT technology and for any other products or product candidates that we develop, or if the scope of the patent or other intellectual property protection obtained is not sufficiently broad, our competitors could develop and commercialize products and technology similar or identical to our products and technology, and our ability to commercialize any product candidates that we may develop, and our technology may be adversely affected; and We will incur increased costs as a result of operating as a public company, and our management will devote substantial time to new compliance initiatives. Implications of Being an Emerging Growth Company and a Foreign Private Issuer We qualify as an emerging growth company pursuant to the Jumpstart Our Business Startups Act of 2012, as amended (the JOBS Act ). An emerging growth company may take advantage of specified exemptions from various requirements that are otherwise applicable generally to U.S. public companies. These provisions include: an exemption that allows the inclusion in an initial public offering registration statement of only two years of audited financial statements and selected financial data and only two years of related disclosure; reduced executive compensation disclosure; exemptions from the requirements of holding a non-binding advisory vote on executive compensation and any golden parachute payments not previously approved; an exemption from compliance with the requirement of the Public Company Accounting Oversight Board regarding the communication of critical audit matters in the auditor s report on the financial statements; and an exemption from the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ) in the assessment of the emerging growth company s internal control over financial reporting. The JOBS Act also permits an emerging growth company such as us to delay adopting new or revised accounting standards until such time as those standards are applicable to private companies. We have elected to use this extended transition period to enable us to comply with certain new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we TABLE OF CONTENTS (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates. We may choose to take advantage of some but not all of these reduced reporting burdens. We will remain an emerging growth company until the earliest of: the last day of our fiscal year during which we have total annual revenue of at least $1.07 billion; the last day of our fiscal year following the fifth anniversary of the closing of the Business Combination; the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt securities; or the date on which we are deemed to be a large accelerated filer under the Securities Exchange Act of 1934, as amended (the Exchange Act ), which would occur if the market value of our Class A ordinary shares that are held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter. In addition, we report under the Exchange Act as a foreign private issuer. As a foreign private issuer, we may take advantage of certain provisions under the rules that allow us to follow Israeli law for certain corporate governance matters. Even after we no longer qualify as an emerging growth company, as long as we qualify as a foreign private issuer under the Exchange Act, we will be exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies, including: the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; the sections of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and liability for insiders who profit from trades made in a short period of time; the rules under the Exchange Act requiring the filing with the U.S. Securities and Exchange Commission (the SEC ) of quarterly reports on Form 10-Q containing unaudited financial and other specified information, or current reports on Form 8-K, upon the occurrence of specified significant events; and Regulation Fair Disclosure ( Regulation FD ), which regulates selective disclosures of material information by issuers. Foreign private issuers, like emerging growth companies, also are exempt from certain more stringent executive compensation disclosure rules. Thus, if we remain a foreign private issuer, even if we no longer qualify as an emerging growth company, we will continue to be exempt from the more stringent compensation disclosures required of public companies that are neither an emerging growth company nor a foreign private issuer. We may take advantage of these exemptions until such time as we are no longer a foreign private issuer. We are required to determine our status as a foreign private issuer on an annual basis at the end of our second fiscal quarter. We would cease to be a foreign private issuer at such time as more than 50% of our outstanding voting securities are held by U.S. residents and any of the following three circumstances applies: the majority of our executive officers or directors are U.S. citizens or residents; more than 50% of our assets are located in the United States; or our business is administered principally in the United States. TABLE OF CONTENTS
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@@ -0,0 +1 @@
+Prospectus Summary 1
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+II-9 10.22@ Amendment No. 1 to Edesa Biotech, Inc. 2019 Equity Incentive Compensation Plan (included as Exhibit 10.1 to the Company s Current Report on Form 8-K filed on April 23, 2021, and incorporated herein by reference). 10.23@ Amendment to Employment Agreement, entered into on March 19, 2021, by and between Par Nijhawan and Edesa Biotech, Inc. (included as Exhibit 10.3 to the Company s Quarterly Report on Form 10-Q filed on May 14, 2021, and incorporated herein by reference). 10.24@ Amendment to Employment Agreement, entered into on March 19, 2021, by and between Kathi Niffenegger and Edesa Biotech USA, Inc. (included as Exhibit 10.4 to the Company s Quarterly Report on Form 10-Q filed on May 14, 2021, and incorporated herein by reference). 10.25@ Amendment to Employment Agreement, entered into on March 19, 2021, by and between Michael Brooks and Edesa Biotech, Inc. (included as Exhibit 10.5 to the Company s Quarterly Report on Form 10-Q filed on May 14, 2021, and incorporated herein by reference). 10.26 Form of Securities Purchase Agreement, dated March 21, 2022, by and between the Company and the Purchaser (included as Exhibit 10.1 to the Company s Current Report on Form 8-K filed on March 23, 2022 and incorporated herein by reference). 21 Subsidiaries of Edesa Biotech, Inc. (included as Exhibit 21 to the Company s Annual Report on Form 10-K filed on December 7, 2020, and incorporated herein by reference). 23.1** Consent of MNP LLP. 23.2** Consent of Fasken Martineau DuMoulin, LLP (included in Exhibit 5.1). 24.1** Power of Attorney (included on signature page). 107** Filing Fee Table * All schedules and exhibits to the Share Exchange Agreement have been omitted pursuant to Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule and/or exhibit will be furnished to the Securities and Exchange Commission upon request. ** Filed herewith. @ Management contract or compensatory plan or arrangement. + Portions of this exhibit have been omitted pursuant to Rule 601(b)(10)(iv) of Regulation S-K. II-10
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+PROSPECTUS SUMMARY 1
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+Prospectus Summary 1 The Offering 5 Risk Factors 6
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/FGDL_franklin_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/FGDL_franklin_prospectus_summary.txt
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+Prospectus Summary The following is a summary of the Prospectus and, while it contains material information about the Fund and the Shares, it does not contain or summarize all of the information about the Fund and the Shares contained in this Prospectus which is material and may be important to you. You should read this entire Prospectus, including Risk Factors beginning on page 6, before making an investment decision about the Shares. Definitions used in this Prospectus can be found in the Glossary of Defined Terms in Appendix A. TRUST STRUCTURE The Trust Franklin Templeton Holdings Trust, or the Trust, was formed as a Delaware statutory trust on April 19, 2021. The Trust currently offers a single series, the Franklin Responsibly Sourced Gold ETF. The Fund issues common units of beneficial interest, or Shares, which represent units of fractional undivided beneficial interest in and ownership of the Fund. The term of the Trust and the Fund is perpetual (unless terminated earlier in certain circumstances). Delaware Trust Company, a subsidiary of the Corporation Service Company, serves as Trustee of the Trust. The material terms of the Agreement and Declaration of Trust between the Trustee and the Sponsor are discussed in greater detail under the section The Declaration of Trust. Franklin Responsibly Sourced Gold ETF The Fund offered pursuant to this Prospectus is the Franklin Responsibly Sourced Gold ETF, also referred to herein as FGLD. The investment objective of the Fund is for the Shares to reflect the performance of the price of gold bullion, less the Fund s expenses. The Fund s only ordinary recurring expense is the Sponsor s annual fee of 0.15% of the NAV of the Fund. The Fund seeks to hold only responsibly sourced gold in the Fund s allocated account. The Fund defines responsibly sourced gold for this purpose as London Good Delivery gold bullion bars that were refined on or after January 1, 2012 (referred to herein as post-2012 gold and London Good Delivery gold bullion bars refined prior to January 1, 2012 referred to herein as pre-2012 gold ). All post-2012 gold has been refined in accordance with London Bullion Market Association s ( LBMA ) Responsible Gold Guidance (the Gold Guidance ). To facilitate this, in transferring gold into and out of the Fund s allocated account, the Custodian will, on a best efforts basis and subject to available liquidity, seek to allocate post-2012 gold. If, due to a lack of liquidity, the Custodian is unable to allocate post-2012 gold to the Fund s allocated account, the Custodian will do so as soon as reasonably practicable. Therefore, under normal market conditions, the Fund expects to hold only post-2012 gold in the Fund s allocated account. The Fund, however, may temporarily deviate from this policy in unusual market conditions, such as in the event of a temporary supply constraint or lack of availability, in which case the Fund will seek to come back into conformity with the policy as soon as reasonably practical. For example, at the time of a creation transaction in the Fund s Shares, only pre-2012 gold may be readily available to the Custodian. In such circumstances, the Custodian would allocate such gold to the Fund s allocated account on a temporary basis until such time as the Custodian is able to swap out the pre-2012 gold for post-2012 gold (including, but not limited to, in connection with redemption transactions). The Fund has not adopted a limit or policy specifying the maximum amount of pre-2012 gold the Fund can hold at any time. However, the Fund expects any holdings of pre-2012 gold to be temporary pursuant to the Custodian s contractual commitments to the Fund, as described herein. The Fund is not able to determine with specificity the total amount of pre-2012 gold that exists across various global reserves, and therefore the Fund is not able to determine what portion of the current market supply of LBMA good delivery gold is comprised of London Good Delivery gold bullion bars produced after January 2012. The Fund is not a proxy for investing in physical gold. Rather, the Shares are intended to provide a cost-effective means of obtaining investment exposure through the securities markets that is similar to an investment in gold. An investment in physical gold requires costly and potentially complex arrangements and accommodations such as those in connection with the assay, transportation, warehousing and insurance of precious metals. As a result of these expenses and complexities, direct investments in physical gold are generally cost-effective only in amounts that are cost prohibitive to many investors. An investment in the Shares is intended to remove these traditional barriers to a cost-effective investment in physical gold by providing an investment with a value that reflects the price of the gold owned by the Fund, less the Fund s expenses and liabilities. Although the Shares are not the exact equivalent of an investment in gold, they provide investors with an alternative means of exposure to the price of gold that allows a level of participation in the gold market through the securities market. The Fund is designed to offer investors exposure to responsibly sourced gold as defined by the Fund in a pooled investment vehicle structure. The Fund defines responsibly sourced gold with reference to the specific criteria established and monitored by the LBMA through its Responsible Sourcing Programme and the Gold Guidance thereunder. The Gold Guidance on which the Fund s responsible sourcing definition and practices rely is described in greater detail beginning on page 18 of the Prospectus. The Fund does not establish, maintain, monitor or control the standards or requirements under the LBMA Responsible Sourcing Programme or the Gold Guidance. Accordingly, an investment in the Fund is subject to the risk that the standards as may be established or amended from time to time do not function as intended or that material violations of the standards are not detected or enforced in a timely manner or at all. The standards may be inadequate or ineffective in mitigating various risks in the LBMA gold sourcing supply chain. These risks may be more pronounced with respect to holdings of recycled gold. For information, please see Risk Factors Risks Related to the Shares The Fund is subject to responsible sourcing due diligence risk. There are actual and potential conflicts of interest inherent in the Fund s structure that you should consider before purchasing Shares. The Sponsor manages the Fund s business and affairs. The Fund does not have a board of directors or its own executive officers and accordingly is reliant on the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. CALCULATION OF REGISTRATION FEE Title of each class of securities to be registered Amount to be registered Proposed maximum aggregate price per share Proposed maximum aggregate offering price Amount of registration fee Franklin Responsibly Sourced Gold ETF Shares (1) (1) (1) (2) (1) In accordance with Rule 456(d) under the Securities Act of 1933, as amended, an indeterminate number of Franklin Responsibly Sourced Gold ETF Shares are being registered as may from time to time be offered hereunder at indeterminate prices. (2) In accordance with Rules 456(d) and 457(u) under the Securities Act, as amended, the registrant is deferring payment of these registration fees and will pay these registration fees on an annual net basis no later than 90 days after the end of each fiscal year. The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Sponsor to resolve any conflicts that may arise between the Sponsor and its affiliates on the one hand and the Fund on the other hand in good faith. Examples of potential conflicts include, among others, conflicts arising from the Trust s indemnification of the Sponsor and its affiliates pursuant to the terms of the Declaration of Trust. The Sponsor, its affiliates and their officers and employees are not prohibited from engaging in other businesses or activities, including those that might be in direct competition with the Fund. See Risk Factors General Risks Potential conflicts of interest may arise among the Sponsor or its affiliates and the Fund. Shares of the Fund represent units of fractional undivided beneficial interest in and ownership of the Fund and will be offered on a continuous basis. The Fund will issue and redeem Shares from time to time in Creation Units only to Authorized Participants. The Fund s Shares will trade under the ticker symbol FGLD on NYSE Arca and other securities exchanges. Authorized Participants and other investors will buy and sell Shares in the secondary market, largely in response to changing demand for Shares. The principal offices of the Trust and the Fund are located at One Franklin Parkway, San Mateo, CA 94403-1906. The Sponsor The Sponsor of the Trust and the Fund is Franklin Holdings, LLC. The Sponsor is a Delaware limited liability company and was formed on July 21, 2021. Under the Delaware Limited Liability Company Act and the governing documents of the Sponsor, Franklin Advisers, Inc., the sole member of the Sponsor, is not responsible for the debts, obligations and liabilities of the Sponsor solely by reason of being the sole member of the Sponsor. Franklin Resources, Inc., a corporation registered under Delaware law, is the ultimate parent company of the Sponsor. The Sponsor is responsible for establishing the Fund and for the registration of the Shares. The Sponsor will generally oversee the performance of the Fund s principal service providers, but will not exercise day-to-day oversight over such service providers. The Sponsor will maintain a public website on behalf of the Fund, containing information about the Fund and the Shares. The Fund s website is www.franklintempleton.com/ investments/options/exchange-tradedfunds/products/31714/SINGLCLASS/ franklin-responsibly-sourced-gold-etf/ FGLD. This website is only provided here as a convenience to you, and the information contained on or connected to the Fund s website is not considered part of this Prospectus. The general role and responsibilities of the Sponsor, as well as the principals and key personnel of the Sponsor, are discussed in greater detail under the section The Declaration of Trust The Sponsor. The Administrator The Administrator of the Fund is BNY Mellon Asset Servicing, a division of The Bank of New York Mellon, or BNYM . The Administrator is generally responsible for the day-to-day administration and operation of the Fund, including the calculation of the NAV of the Fund and the NAV per Share. The general role and responsibilities of the Administrator are discussed in greater detail under the section Description of Key Service Providers The Administrator. The Transfer Agent The Transfer Agent is BNYM. The Transfer Agent serves as the Fund s transfer agent in connection with Creation and Redemption transactions of Shares and acts as the Fund s distribution disbursing agent. The Transfer Agent receives and processes orders from Authorized Participants to create and redeem Creation Units and coordinates the processing of such orders with the Custodian and The Depository Trust Company, or DTC. The general role and responsibilities of the Transfer Agent are discussed in greater detail under the section Description of Key Service Providers The Transfer Agent. The Custodian (Cash Only) The custodian of the Fund s cash, if any, is BNYM. BNYM is generally responsible for establishing and maintaining one or more cash accounts for the Fund. BNYM also maintains books and records segregating the assets of the Fund from the assets of any other series of the Trust. The general role and responsibilities of BNYM as custodian of the Fund s cash are discussed in greater detail under the section Description of Key Service Providers The Custodian (Cash Only). The Custodian JPMorgan serves as the Custodian of the Fund. The Custodian is responsible for safekeeping the gold bullion owned by the Trust. The Custodian is a market maker, clearer and approved weigher of gold under the rules of the London Bullion Market Association, or LBMA. The general role, responsibilities and regulation of the Custodian are further described in section Description of Key Service Providers The Custodian. The Marketing Agent The Marketing Agent is Franklin Distributors, LLC. The Marketing Agent, an affiliate of the Sponsor, assists the Sponsor in marketing the Shares. The Marketing Agent is a registered broker-dealer with the SEC and is a member of the Financial Industry Regulatory Authority, Inc. ( FINRA ). The Trust Is an Emerging Growth Company The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and the Sponsor and the Trust are not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PROSPECTUS Subject to Completion Dated June 17, 2022 Franklin Templeton Holdings Trust Shares of Franklin Responsibly Sourced Gold ETF Franklin Responsibly Sourced Gold ETF, A Series Of Franklin Templeton Holdings Trust The Franklin Templeton Holdings Trust (the Trust ) is organized as a Delaware statutory trust. The Franklin Responsibly Sourced Gold ETF series of the Trust (the Fund ) issues and offers shares ( Shares ) which represent units of fractional undivided beneficial interests in the net assets of the Fund. Only Shares of the Fund, and no other series of the Trust, as may be issued from time to time, are offered in this prospectus ( Prospectus ). The investment objective of the Fund is for the Shares to reflect the performance of the price of gold bullion, less the Fund s expenses. The assets of the Fund include only gold bullion and cash, if any. The Fund is not a proxy for investing in physical gold. Rather, the Shares are intended to provide a cost-effective means of obtaining investment exposure through the securities markets that is similar to an investment in gold. The Fund seeks to hold only responsibly sourced gold in the Fund s allocated account. The Fund defines responsibly sourced gold for this purpose as London Good Delivery gold bullion bars that were refined on or after January 1, 2012 (also referred to herein as post-2012 gold ). All post-2012 gold has been refined in accordance with London Bullion Market Association s ( LBMA ) Responsible Gold Guidance (the Gold Guidance ), described further herein. To facilitate this, in transferring gold into and out of the Fund s allocated account, the Custodian will, on a best efforts basis and subject to available liquidity, seek to allocate post-2012 gold. If, due to a lack of liquidity, the Custodian is unable to allocate post-2012 gold to the Fund s allocated account, the Custodian will do so as soon as reasonably practicable. The Fund intends to issue and offer Shares on a continuous basis. The Shares may be purchased from the Fund only in one or more blocks of 50,000 Shares (a block of 50,000 Shares is called a Creation Unit ). The Fund will issue Shares in Creation Units to institutional investors referred to as Authorized Participants on an ongoing basis as described in Plan of Distribution. Creation Units will be offered continuously at the net asset value ( NAV ) for 50,000 Shares on the day that an order to create a Creation Unit is accepted by the Fund. The Fund s Shares will be listed on NYSE Arca, Inc. ( NYSE Arca ) under the symbol FGLD. Franklin Holdings, LLC is the Sponsor of the Trust (the Sponsor ). The Trust is a Delaware statutory trust that was formed on April 19, 2021. The Shares are not obligations of, and are not guaranteed by, the Sponsor or any of its subsidiaries or affiliates. BNY Mellon Asset Servicing, a division of The Bank of New York Mellon, or BNYM, is the Administrator (the Administrator ) and Transfer Agent (the Transfer Agent ) of the Fund. BNYM also serves as the custodian of the Fund s cash, if any. JPMorgan Chase Bank, N.A., London branch ( JPMorgan ), serves as the custodian (the Custodian ) of the Fund s gold bullion. Delaware Trust Company, a subsidiary of the Corporation Services Company, is the sole trustee of the Trust (the Trustee ). Franklin Distributors, LLC is the marketing agent of the Fund (the Marketing Agent ). The Trust is an emerging growth company as defined under the federal securities laws and, as such, has elected to comply with certain reduced public company reporting requirements for this Prospectus and future filings. Investing in the Shares involves significant risks and may not be suitable for certain investors. Shareholders do not have any voting rights under the Trust s governing documents except as the Sponsor may authorize from time to time. See Risks Related to the Shares Shareholders do not have the rights enjoyed by investors in certain other vehicles. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities offered in this Prospectus, or determined if this Prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The Fund will issue and redeem Shares from time to time in Creation Units only to Authorized Participants in exchange for the delivery to the Fund, or the distribution by the Fund, of the amount of gold bullion represented by the Creation Units being created or redeemed. This amount is based on the combined NAV of the number of Shares included in the Creation Units being created or redeemed, as applicable, determined on the day the order to create or redeem Creation Units is accepted, as described in Creations and Redemptions. The Shares will be sold to the public at prices that will reflect the price of gold and the trading price of the Shares on NYSE Arca at the time of the offer. The Shares are neither interests in nor obligations of the Sponsor, the Trustee, the Administrator, the Transfer Agent, the Custodian, the Marketing Agent or their respective affiliates. The Shares are not insured by the Federal Deposit Insurance Corporation or any other governmental agency. The Trust is not an investment company registered under the Investment Company Act of 1940, as amended (the 1940 Act ), and is not required to register under such act. The Fund is not a commodity pool for purposes of the Commodity Exchange Act of 1936, as amended (the CEA ), and neither the Sponsor nor the Trustee are subject to regulation by the Commodity Futures Trading Commission ( CFTC ) as a commodity pool operator or a commodity trading advisor with respect to the Fund. See Regulatory Risks Shareholders do not have the protections associated with ownership of shares in an investment company registered under the 1940 Act or the protections afforded by the CEA. On May 24, 2022, JP Morgan Securities LLC (the Initial AP ), subject to conditions and acting as a statutory underwriter in connection with the initial purchase of Shares, deposited gold for the purchase of Seed Creation Units totaling 100,000 Shares at the price equal to $25 per Share. Total proceeds to the Fund from the sale of the Seed Creation Units were 1,338.976 ounces of gold. At contribution, the value of the gold deposited with the Fund was based on the LBMA Gold Price PM announced on May 24, 2022 of $1,867.10 per ounce of gold. Delivery of the Seed Creation Units was made on May 26, 2022. The Initial AP intends to offer to the public these 100,000 Shares at a per-Share offering price that will vary depending on, among other things, the price of gold and the trading price of the Shares on the NYSE Arca at the time of the offer. Shares offered by the Initial AP at different times may have different offering prices. Prior to this offering, there was no public market for the Shares. The Initial AP is not affiliated with the Sponsor or the Trustee. As of May 24, 2022, there were 100,000 Shares outstanding. The date of this Prospectus is June [___], 2022 The Trust is an emerging growth company subject to reduced public company reporting requirements under U.S. federal securities laws. Under the JOBS Act, emerging growth companies like the Trust are subject to reduced public company reporting requirements, as more fully described in the section Risk Factors. The Trust expects to remain an emerging growth company until the earliest of (i) the last day of the fiscal year on which the fifth anniversary of its initial public offering of Shares occurs, or (ii) the Trust becoming a large accelerated filer within the meaning of the Exchange Act. Other conditions that may trigger a loss of emerging growth company status are not expected to apply to the Trust due to the limited nature of its operations. THE FUND S OBJECTIVE The investment objective of the Fund is for the Shares to reflect the performance of the price of gold bullion, less the expenses of the Fund s operations. The Fund pays the Sponsor an annual fee of 0.15%, which is the Fund s only ordinary recurring expense. It is expected that, for many investors, the costs associated with buying and selling the Shares in the secondary market and the payment of the Fund s ongoing expenses will be lower than the costs associated with buying and selling gold bullion and storing and insuring gold bullion in a traditional allocated gold bullion account. The Shares are designed for investors who want a cost-effective and convenient way to invest in responsibly sourced gold. The Shares trade on NYSE Arca and provide institutional and retail investors with indirect access to the gold bullion market. They may be bought and sold on NYSE Arca like any other exchange-listed securities, and regularly trade until 4:00 p.m. Eastern time. Investing in the Shares involves certain risks, including price volatility. See Risk Factors. PRINCIPAL OFFICES The Fund s office is located at One Franklin Parkway, San Mateo, CA 94403-1906 and its telephone number is (650) 312-2000. The Sponsor s office is located at One Franklin Parkway, San Mateo, CA 94403-1906 and its telephone number is (650) 312-2000. The Trustee s office is located at 251 Little Falls Drive, Wilmington, DE 19808. The Administrator s office is located at 2 Hanson Place, Brooklyn, New York 11217. The Transfer Agent s office is located at 2 Hanson Place, Brooklyn, New York 11217. The Custodian s office is located at 25 Bank St, Canary Wharf, London E14 5JP, United Kingdom. The Marketing Agent s office is located at One Franklin Parkway, San Mateo, CA 94403-1906. This Prospectus contains information you should consider when making an investment decision about the Shares. You may rely on the information contained in this Prospectus. The Trust and the Sponsor have not authorized any person to provide you with different information and, if anyone provides you with different or inconsistent information, you should not rely on it. This Prospectus is not an offer to sell the Shares in any jurisdiction where the offer or sale of the Shares is not permitted. The Shares are not registered for public sale in any jurisdiction other than the United States. Persons outside of the United States who come into possession of this Prospectus must inform themselves about, and observe any restrictions relating to, the offering of the Shares and the distribution of this Prospectus outside of the United States. TABLE OF CONTENTS PART ONE DISCLOSURE DOCUMENT STATEMENT REGARDING FORWARD-LOOKING STATEMENTS iv PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/FGNXP_fg-nexus_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/FGNXP_fg-nexus_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a4b1e81c117d4d9c8fe7a2df5c82ecbe80c82235
--- /dev/null
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@@ -0,0 +1,158 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary description about us and our business highlights selected information contained elsewhere in this prospectus or incorporated
+by reference into this prospectus. It does not contain all the information you should consider before investing in our securities. Important
+information is incorporated by reference into this prospectus. To understand this offering fully, you should read carefully this prospectus
+and the documents incorporated by reference in their entirety, including "Risk Factors" included in this prospectus and incorporated
+by reference, "Cautionary Statement Regarding Forward-Looking Statements," and "Management s Discussion and Analysis
+of Financial Condition and Results of Operations" and the financial statements and the notes to those financial statements incorporated
+by reference in this prospectus, together with the additional information described under "Incorporation by Reference."
+
+ 
+
+Overview
+
+ 
+
+FG
+Financial Group, Inc. is a reinsurance and investment management holding company. We focus on opportunistic collateralized and
+loss capped reinsurance, while allocating capital in partnership with Fundamental Global to SPAC and SPAC sponsor-related
+businesses. The Company s principal business operations are conducted through its subsidiaries and affiliates. The
+Company also provides investment management services. From our inception in October 2012 through December 2019, we operated as an insurance
+holding company, writing property and casualty insurance throughout the states of Louisiana, Florida, and Texas. On December 2, 2019,
+we sold our three former insurance subsidiaries, and embarked upon our current strategy focused on reinsurance and asset management.
+
+ 
+
+As of March 31, 2022, Fundamental Global
+GP, LLC, a privately owned investment management company, and its affiliates, or "FG," beneficially owned approximately 56%
+of our common stock. D. Kyle Cerminara, Chairman of our Board of Directors, serves as Chief Executive Officer, Co-Founder and Partner
+of FG.
+
+ 
+
+Sale of the Insurance Business
+
+ 
+
+On December 2, 2019, we completed the sale
+of our insurance subsidiaries to FedNat Holding Company for a combination of cash and FedNat common stock (the "Asset Sale").
+The shares of FedNat common stock we received in the Asset Sale were issued to us pursuant to a standstill agreement which provides certain
+limitations and restrictions with respect to the voting and sale or transfer of the securities until December 2024. As of March 31,
+2022, we continued to hold 790,371 shares of FedNat common stock.
+
+ 
+
+Current Business
+
+ 
+
+Our strategy has evolved to focus on opportunistic
+collateralized and loss-capped reinsurance, with capital allocation to special purpose acquisition companies ("SPACs") and
+SPAC sponsor-related businesses. As part of our refined focus, we have adopted the following capital allocation philosophy:
+
+ 
+
+"Grow
+intrinsic value per share with a long-term focus using fundamental research, allocating capital to
+asymmetric risk/reward opportunities."
+
+ 
+
+Currently,
+the business operates as a diversified holding company of insurance, reinsurance, asset management and our SPAC Platform businesses.
+
+ 
+
+Insurance
+
+ 
+
+We are establishing a Risk Retention Group
+("RRG") to provide directors and officers insurance coverage to SPACs and their sponsors. We intend to provide capital, along
+with other participants, to facilitate underwriting such insurance coverage. The Company will focus on fee income derived from originating,
+underwriting, and servicing the insurance business, while mitigating our financial risk with external reinsurance partners.
+
+ 
+
+Reinsurance
+
+ 
+
+The Company s wholly owned reinsurance
+subsidiary, FG Reinsurance Ltd. ("FGRe"), a Cayman Islands limited liability company, provides specialty property and casualty
+reinsurance. FGRe has been granted a Class B(iii) insurer license in accordance with the terms of The Insurance Law Act (as revised)
+of the Cayman Islands and is subject to regulation by the Cayman Islands Monetary Authority (the "Authority"). The terms
+of the license require advance approval from the Authority, should FGRe wish to enter into any reinsurance agreements which are not fully
+collateralized to their aggregate exposure limit. FGRe participates in multiple quota share reinsurance contracts, consisting of contracts
+with a Funds at Lloyds syndicate and also with a leading insurtech company that provides automotive insurance utilizing driver monitoring
+to predictively segment and price drivers. FGRe s exposure is limited by loss-caps stipulated in the quota-share agreements. In total, the Company has written
+six reinsurance contracts. 
+
+ 
+
+Asset
+Management
+
+ 
+
+Pursuant to an investment advisory agreement,
+FG Strategic Consulting, LLC ("FGSC") a wholly-owned subsidiary of the Company, has agreed to provide investment advisory
+services to FedNat, including identifying, analyzing and recommending potential investments, advising as to existing investments and
+investment optimization, recommending investment dispositions, and providing advice regarding macro-economic conditions. In exchange
+for providing the investment advisory services, FedNat has agreed to pay FGSC an annual fee of $100,000. The Investment Advisory Agreement
+expires in December 2024. 
+
+ 
+
+ 
+
+ 
+
+ 2
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+SPAC
+Platform
+
+ 
+
+On December 21, 2020, we formed FG SPAC
+Solutions LLC ("FGSS"), a Delaware company, to facilitate the launch of our "SPAC Platform." Under the SPAC Platform,
+we plan to provide various strategic, administrative, and regulatory support services to newly formed SPACs, for a monthly fee. Additionally,
+the Company co-founded a partnership, FG SPAC Partners, LP ("FGSP"), to participate as a co-sponsor for newly formed SPACs.
+The Company also participates in the risk capital investments associated with the launch of such SPACs through its Asset Management business,
+specifically FG Special Situations Fund, LP. The SPAC Platform entered into its first transaction with Aldel Investors, LLC, the sponsor
+of Aldel Financial, Inc. ("Aldel"), a special purpose acquisition company, which completed its business combination with
+The Hagerty Group, an automotive and marine insurer, on December 2, 2021. FGSS provided accounting, regulatory, strategic advisory, and
+other administrative services to Aldel, which included assistance with negotiations with potential merger targets for the SPAC, as well
+as assistance with the de-SPAC process.
+
+ 
+
+Recent
+Developments
+
+ 
+
+Initial
+Public Offerings from SPAC Platform Sponsors
+
+ 
+
+In March and April 2022, the Company continued
+to build upon its SPAC Platform strategy. On March 3, 2022, FG Merger Corp. ("FG Merger") (Nasdaq: FGMCU) announced the closing
+of an $80.5 million IPO in the United States, including the exercise of the over-allotment option granted to the underwriters in
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/FOFA_family_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/FOFA_family_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..819bac1a3973eefe80b037cf7973f61e88541129
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/FOFA_family_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 2
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/FRGE_forge_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/FRGE_forge_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..edde1a35007843eb8203c36c3b8848680365543b
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/FRGE_forge_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1 INFORMATION RELATED TO OFFERED SECURITIES 9 CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS 11 RISK FACTORS 13 USE OF PROCEEDS 39 DETERMINATION OF OFFERING PRICE 39 DIVIDEND POLICY 40 MARKET INFORMATION 40 SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS 40 UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION 41 BUSINESS 51 MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 68 CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS 91 MANAGEMENT 94 EXECUTIVE COMPENSATION 99 DESCRIPTION OF CAPITAL STOCK 105 SECURITIES ACT RESTRICTIONS ON RESALE OF SECURITIES 114 PRINCIPAL STOCKHOLDERS 116 SELLING SECURITYHOLDERS 118 PLAN OF DISTRIBUTION 122 LEGAL MATTERS 126 EXPERTS 126 WHERE YOU CAN FIND MORE INFORMATION 127 INDEX TO FINANCIAL STATEMENTS F-1 i Table of Contents INTRODUCTORY NOTE AND FREQUENTLY USED TERMS On March 21, 2022 (the Closing Date ), Forge Global Holdings, Inc., a Delaware corporation and our predecessor company Motive (as defined below), consummated the previously announced business combination (the Business Combination ) pursuant to the terms of the Agreement and Plan of Merger, dated September 13, 2021 (the Merger Agreement ), by and among Motive, FGI Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Motive ( Merger Sub ), and Forge Global, Inc., a Delaware corporation ( Legacy Forge ). Pursuant to the Merger Agreement, on the Closing Date, (i) immediately prior to the consummation of the Business Combination, Motive filed a Certificate of Corporate Domestication and a Certificate of Incorporation with the Delaware Secretary of State and filed an application to de-register with the Registrar of Companies of the Cayman Islands (the Domestication ), (ii) upon effectiveness of the Domestication, Motive became a Delaware corporation and changed its corporate name to Forge Global Holdings, Inc. (the Company ), and (iii) Merger Sub merged with and into Legacy Forge (the Merger ), with Legacy Forge surviving the Merger as a direct, wholly-owned subsidiary of the Company. The Company is the successor issuer to Motive pursuant to Rule 12g-3(a) promulgated under the Exchange Act. Unless the context otherwise requires, references in this prospectus to Forge , the Company , us , we , our and any related terms prior to the closing of the Business Combination are intended to mean Legacy Forge, and after the closing of the Business Combination, the Company and its consolidated subsidiaries. In addition, in this document, unless otherwise stated or the context otherwise requires, references to: Motive are to Motive Capital Corp, a Cayman Islands exempted company, prior to the Closing; Board are to the board of directors of the Company; Business Combination or Transactions are to the Merger and other transactions contemplated by the Merger Agreement, collectively; Closing refers to the closing of the Business Combination; Certificate of Incorporation are to the Certificate of Incorporation of Forge Global Holdings, Inc., dated March 21, 2022; Exchange Act are to the Securities Exchange Act of 1934, as amended; Governing Documents are to the Certificate of Incorporation and the Bylaws of the Company; NYSE are to the New York Stock Exchange; Securities Act are to the Securities Act of 1933, as amended; and Sponsor are to Motive Capital Funds Sponsor, LLC, a Cayman Islands limited liability company. MARKET AND INDUSTRY DATA This prospectus contains estimates and information concerning our industry, our business, and the market for our products and services, including our general expectations of our market position, market growth forecasts, our market opportunity, and size of the markets in which we participate, that are based on industry publications, surveys, and reports that have been prepared by independent third parties. This information involves a number of assumptions and limitations, and you are cautioned not to give undue weight to these estimates. Although we have not independently verified the accuracy or completeness of the data contained in these industry publications, surveys, and reports, we believe the publications, surveys, and reports are generally reliable, although such information is inherently subject to uncertainties and imprecision. ii Table of Contents ABOUT THIS PROSPECTUS This prospectus is part of a registration statement on Form S-1 that we filed with the Securities and Exchange Commission (the SEC ) using the shelf registration process. Under this shelf registration process, the Selling Securityholders may, from time to time, sell the securities offered by them described in this prospectus. We will not receive any proceeds from the sale by such Selling Securityholders of the securities offered by them described in this prospectus. This prospectus also relates to the issuance by us of the shares of common stock issuable upon the exercise of any warrants, assumed warrants and Former Employee Options. We will receive proceeds from any exercise of the warrants, assumed warrants and Former Employee Options for cash. Neither we nor the Selling Securityholders have authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or any applicable prospectus supplement or any free writing prospectuses prepared by or on behalf of us or to which we have referred you. Neither we nor the Selling Securityholders take responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. Neither we nor the Selling Securityholders will make an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. We may also provide a prospectus supplement or post-effective amendment to the registration statement to add information to, or update or change information contained in, this prospectus. You should read both this prospectus and any applicable prospectus supplement or post-effective amendment to the registration statement together with the additional information to which we refer you in the sections of this prospectus entitled Where You Can Find More Information. Neither we nor the Selling Securityholders have authorized anyone to provide any information or to make any representations other than those contained in this prospectus, any accompanying prospectus supplement or any free writing prospectus we have prepared. We and the Selling Securityholders take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the securities offered hereby and only under circumstances and in jurisdictions where it is lawful to do so. No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus, any applicable prospectus supplement or any related free writing prospectus. This prospectus is not an offer to sell securities, and it is not soliciting an offer to buy securities, in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus or any prospectus supplement is accurate only as of the date on the front of those documents, regardless of the time of delivery of this prospectus or any applicable prospectus supplement, or any sale of a security. Our business, financial condition, results of operations and prospects may have changed since those dates. For investors outside the United States: neither we nor the Selling Securityholders have done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of our securities and the distribution of this prospectus outside the United States. This prospectus contains summaries of certain provisions contained in some of the documents described herein, but reference is made to the actual documents for complete information. All of the summaries are qualified in their entirety by the actual documents. Copies of some of the documents referred to herein have been filed, will be filed or will be incorporated by reference as exhibits to the registration statement of which this prospectus is a part, and you may obtain copies of those documents as described below under Where You Can Find More Information. This prospectus contains references to trademarks, trade names and service marks belonging to other entities. Solely for convenience, trademarks, trade names and service marks referred to in this prospectus may appear without the or TM symbols, but such references are not intended to indicate, in any way, that the applicable licensor will not assert, to the fullest extent under applicable law, its rights to these trademarks and trade names. We do not intend our use or display of other companies trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies. iii Table of Contents PROSPECTUS SUMMARY This summary highlights selected information from this prospectus and does not contain all of the information that is important to you in making an investment decision. This summary is qualified in its entirety by the more detailed information included elsewhere in this prospectus. Before making your investment decision with respect to our securities, you should carefully read this entire prospectus, including the information under Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations, Unaudited Pro Forma Condensed Combined Financial Information and the financial statements included elsewhere in this prospectus. Unless the context otherwise requires, the terms Forge, the Company, we, us and our in this prospectus refer to Forge Global Holdings, Inc. and its consolidated subsidiaries. Overview At Forge, we firmly believe that everyone should have the opportunity to participate in the private market and have built technology and solutions to power an accessible, liquid, and transparent private market for everyone. Our mission is to give a broader group of people the ability to buy and sell private shares in some of the world s most innovative companies and help all who participate in the private market economy to accelerate destiny. Forge is a leading provider of marketplace infrastructure, data services, and technology solutions for private market participants. Our global online trading platform, Forge Markets, enables accredited institutional and individual investors to purchase private company shares from current and former employees, as well as existing investors. Our accessible and technology-enabled market makes it easy for employees to sell their private shares, for companies to reward shareholders with pre-IPO liquidity and for individual and institutional investors to contribute to and potentially benefit from private unicorn growth. Since inception, we have added complementary pillars alongside Forge Markets to provide the access, transparency and solutions that companies, as well as institutional and individual investors and shareholders need to confidently navigate and efficiently transact in the private markets. The four pillars that make up our business are: Forge Markets: Our online trading platform that connects potential investors with private company shareholders and enables them to efficiently facilitate private share transactions Forge Trust: Our non-depository trust company that enables clients to securely custody and manage non-liquid assets through a robust and user-friendly online portal Forge Data: Our data business provides market participants the information and insight to confidently navigate, analyze and make investment decisions in the private market Forge Company Solutions: Our software solution purpose built for private companies to easily administer primary and secondary financing events We have strategically invested in these four pillars because we believe they will collectively drive strong network effects and help power the private market ecosystem. 1 Table of Contents Forge uniquely delivers streamlined access to the private market taking a historically analog and opaque process and modernizing it with an efficient, transparent digital platform. Forge was formed in 2014. SharesPost was formed in 2009. Forge acquired SharesPost in November of 2020. Including Forge historical data from its inception and SharesPost historical data from its inception, on a pro forma basis, as of December 31, 2021, we have facilitated over 21,000 trades in over 450 companies for buy-side and sell-side clients in 70 countries. As of December 31, 2021, we had 1,223 institutions, over 447,000 registered users, including approximately 140,000 accredited investors, all of whom have indicated interest in accessing shares in private companies through our online platform. Including Forge historical data from its inception and SharesPost historical data from its inception, we have closed more than $12 billion in transaction volume. We had approximately $3.2 billion in transaction volume in the twelve months ending December 31, 2021, and we believe Forge is experiencing the distinct advantage of a large marketplace s scale where volume begets more volume. The Forge platform serves people who have different aspirations and needs, such as: The innovative CEO who wants to stay private and retain employees as long as it takes to achieve her long-term vision The dedicated employee who needs to pay for her child s college tuition or buy a home today and cannot afford to wait for her company to go public The passionate investor who knows that investors in the last round of a private company before IPO often see outsized gains when compared to public market investments but has historically lacked access to this investment class And institutions who provide clients investment opportunities in attractive private stocks We have experienced strong revenue growth, while operating the business in a capital-efficient manner. We attribute our track record of growth to the key strategic investments we have made since inception, the remarkable efforts of our employees, the momentum contributed by our many clients, and our commitment to ensuring that our technology performs at the highest level. From creating a digital and scalable private market ecosystem, to helping our customers securely custody their assets, it is our technology, coupled with our data and operational expertise, that has been, and will continue to be, critical to enabling our long-term success. The Large and Rapidly Growing Private Market Private companies issue shares or grant options in their firms to incentivize and retain employees as part of their overall compensation package, or to fund growth by exchanging them for cash with investors. While employees and investors expect the price of the shares to rise and thus receive a positive return when the shares are sold, historically it was a challenge to monetize the shares before the company was bought or went public on a listing exchange such as the NYSE or the Nasdaq Stock Market. Over the past 20 years, technology companies have increasingly stayed private longer. This is due in part to the availability of capital in the private markets, a company s desire to avoid managing its business to a quarterly earnings cycle, and the increased cost and regulatory hurdles associated with being a public company. According to a study published March 2021, by Jay Ritter, Warrington College of Business, University of Florida from 1999 to 2020: The median age of technology companies at the time of the initial public offering ( IPO ) has increased from 4 to 12 years; and The median market capitalization of these companies at the time they complete their IPO has also increased from $493 million to $4.3 billion. Many of these private companies are building substantial value for their shareholders and growing quickly with the help of unprecedented levels of investment capital. However, more of that growth and value creation is now taking place while they remain private. Unless investors can access and participate in that growth before the companies go public or are acquired, outside investors do not have an opportunity to benefit from the value that is created. 2 Table of Contents A good benchmark demonstrating how quickly the private market is growing is the number of unicorns created, as well as market capitalization associated with them. A unicorn is defined as a company with an equity valuation more than $1 billion. According to Business Today and CB Insights: As of March 2022, there are more than 1,000 unicorns, with 734 formed since 2020 and 519 in 2021 alone; Since December 2021, the number of unicorns has grown by 13.9%; and These unicorns combined represent a $3.4 trillion equity value opportunity according to CB Insights. As a result of these trends, a growing number of shareholders and employees seek liquidity while companies remain private. At the same time, companies need technology and services to ensure they re able to manage their shareholders needs and to stay competitive when hiring and retaining talent. In 2020, investors contributed over $270 billion into private companies because they wanted to participate in the innovation economy, and they understood this is where the best potential returns are often realized. When you compare the 12-month performance of IPOs from 2010-2020 versus the performance had you invested in the round prior to the IPO, there is a marked difference. The 12-month return from IPOs during that time period is 37%, while the return had you invested in the round prior to the IPO is 277%. Powerful Network Effect Afforded Through Our Four Pillars Forge is building the needed technology infrastructure to power the private markets and providing the liquidity, access, and transparency that ecosystem participants need and want. Our platform is built to enable more than just trading; we are bringing together a robust set of complementary businesses along with a coalition of partners that together delivers a comprehensive solution empowering the private market ecosystem at scale. In addition to leveraging Forge s relationships with over 447,000 individual investors and 1,223 institutional investors (each as of December 31, 2021), Forge s platform benefits from a unique distribution network that includes strategic investors and commercial partners that have strong relationships with private companies and investors. Forge has the opportunity to benefit from these partnerships through introductions to private companies, shareholders, and the buy-side demand delivered by strategic investors and commercial partners. Our strategic investors include, among others, public market exchange Deutsche B rse, large global banks Wells Fargo and BNP Paribas, and asset manager Temasek. We have entered into referral, collaborative marketing or API/website linking 3 Table of Contents arrangements with BNP Paribas, wealth manager Addepar and cap table companies Certent and AST Private Company Solutions, with respect to its Astrella platform, pursuant to which we have agreed to promote each other s services to each other s clients or otherwise collaborate through marketing, referrals and/or technological integrations. We re building a future where sellers on Forge Markets become buyers. Buyers become custody account holders at Forge Trust. Account holders borrow against their assets to buy more stock. Companies use Forge Company Solutions to offer liquidity to employees. Every step along the way generates information that is captured and provides transparency to market participants through Forge Data. We believe that these complementary product offerings result in the opportunity for growth in one pillar to accelerate the growth of the others, increasing client engagement and enhancing the Forge brand. The combination of Forge Markets, Forge Trust, Forge Company Solutions and Forge Data provides private markets clients with the critical ecosystem and technology they need to execute transactions and securely hold their non-liquid assets. In providing clients an end-to-end solution, Forge has a clearly differentiated value proposition in the market. Our Growth Strategy We believe the private market has an unmet need for the technology we have built. We expect to leverage our platform to continue to drive growth in the following areas: Additional Scale in Our Four Pillars. We will continue to invest and scale our Forge Markets, Forge Trust, Forge Company Solutions and Forge Data businesses and build our client and investor networks. New Products. We will continue to build and add new products in support of, or in addition to our existing four pillars. Additional Partnerships. We are building strong relationships with partners that we can work with to create improved technologies and help distribute our products and services. International Expansion. We may in the future expand our operations in Asia and/or Europe in order to match the global demand for our products and services. While we are continually evaluating international market expansion opportunities, we currently have no definitive plans with respect to specific international markets, timing or estimated costs of such expansion. Issuers, buyers and sellers from over sixty jurisdictions have transacted on our platform. The majority of our revenues are derived from transactions involving U.S. issuers. Our operations are located in the United States. We have a local branch office in Hong Kong. Our subsidiary, SharesPost Asia Pte Ltd., holds a Recognized Market Operator license with the Monetary Authority of Singapore; however, it currently does not engage in any business activities. See Risk Factors Regulatory, Tax and Legal Risks We have expanded and may continue to expand into international markets, which expose us to significant new risks, and our international expansion efforts may not be successful. New Asset Classes. We will continue to explore other non-liquid asset classes that have significant investor demand. Inorganic Opportunities. We will focus on value-generating M&A, drawing on our track record of integrating previous acquisitions. Our Competitive Strengths We have built a market-leading financial technology platform to digitize a complex and historically analog process and, in the process, changed the landscape of private market investing for companies, employees and individual and institutional clients. We believe we are well-positioned to serve an increasing portion of the broader financial services ecosystem. Solely Focused on the Private Market Since inception, we have built world-class technology and invested heavily in an organization focused solely on facilitating private market transactions. This proprietary technology and operating expertise is supported by standard documentation and efficient workflows which makes the processing of trades an efficient and user-friendly experience. Amassing the technical expertise and know-how to perform these tasks at scale across both direct and SPV trades is difficult, and we believe we are uniquely positioned as we continue to automate large parts of this traditionally offline process. Complimentary and Integrated Strategy Powered by Four Pillars We strategically built our business model around Forge Markets, Forge Trust, Forge Company Solutions, and Forge Data to deliver a robust set of products and services that provide a better customer experience, synergies across the four business units, and strong user economics. We believe over time customers will increasingly look to end-to-end technology providers that can provide a 4 Table of Contents holistic approach to their private market needs. The investments we made will enable us to quickly introduce new products and services while also providing us the opportunity to quickly and profitably continue to scale. Leading Technology Platform in the Private Markets Operating at Scale We believe that Forge Markets is the leading private market trading platform based on number of transactions processed. Since Forge s inception, together with the historical business and companies we have acquired, as of December 31, 2021, we have facilitated over $12 billion in transaction volume across more than 21,000 transactions and more than 450 companies.. The product design and underlying technology of our platform make matching and closing of private market transactions easier and faster. We continually seek client feedback and invest resources to improve the user experience, accelerate liquidity, and attract new clients on the platform. Robust Technology and Creative Product Design We believe participation in the private markets at scale can only happen by actively engaging with, and providing access to, a larger portion of the population through intuitive user-friendly technology and products. We put automation and design at the center of our products with the goal of making the user experience as easy and enjoyable as possible. We involve our talented product designers early and often throughout our product development process to create elegant experiences that solve the private markets biggest pain points and address our customers largest needs. Compelling Business Model Our user-friendly platform has enabled thousands of clients to access the private markets while modernizing the way shares of private companies get traded. Our unique value proposition and high repeat and engagement rates have delivered rapid growth despite limited marketing spend. Our attractive cohort economics should improve over time as our customers deepen their engagement and relationship with Forge. Diverse and Experienced Team We have assembled a deep and experienced leadership team that includes senior executives from innovative technology companies, marquee and top-tier financial firms, leading public market exchanges, and globally recognized asset managers. We operate as one team, leveraging our collective expertise, particularly in technology and product development, to enhance and expand our operations. We are also proud and fortunate to have talented and passionate employees that are bold, humble, and accountable and a culture that puts trust, transparency and collaboration top-of-mind. Competition We compete with individual brokers and companies that provide access to private market trading, custody services, data packages and other private market capital solutions. Competitors within these four pillars include other online private shares marketplaces and offline brokers, global banks, custodial service providers, and subscription-based data providers (including data divisions of large stock exchanges). We believe we are highly differentiated relative to our competition as a result of having all four pillars under the same business, a coalition of strategic and commercial partners that includes exchanges, global banks, cap table companies and asset managers as well as existing scale where volume begets volume creating an inflection point that accelerates market adoption for our products. Risk Factors Summary An investment in our securities is subject to numerous risks and uncertainties, including those highlighted in the section titled Risk Factors. These risks include, but are not limited to, the following: Forge has a history of losses and may not achieve or maintain profitability in the future. Forge faces intense and increasing competition and, if we do not compete effectively, our competitive positioning and our operating results will be harmed. Some of our current and potential competitors have longer operating histories, particularly with respect to our financial services business, significantly greater financial, technical, marketing and other resources and a larger customer base than we do. Forge s business is subject to the regulatory framework applicable to investment advisers, broker-dealers, and alternative trading systems, including regulation by the SEC and FINRA. 5 Table of Contents Forge s business is subject to extensive laws and regulations promulgated by U.S. state, U.S. federal and non-U.S. laws, including those applicable to broker dealers, investment advisers and alternative trading systems, including regulation by the SEC and FINRA in the jurisdictions in which we operate. Compliance with laws and regulations require significant expense and devotion of resources, which may adversely affect our ability to operate profitably. Past performance by our management team or their respective affiliates may not be indicative of future performance of an investment in us. Forge s management does not have prior experience in managing a publicly traded company. COVID-19 or another pandemic, epidemic or outbreak and political events, such as the conflict in Ukraine, may have an adverse effect on Forge s business, results of operations, financial condition and cash flows, the nature and extent of which are highly uncertain and unpredictable. If Forge fails to manage its growth effectively, it may be unable to execute its business plan, maintain high levels of service and member satisfaction or adequately address competitive challenges. If we are unable to adequately address these and other risks we face, our business, results of operations, financial condition and prospects may be harmed. Corporate Information We were incorporated on September 28, 2020 as a Cayman Islands exempted company. Upon the Closing, we changed our name to Forge Global Holdings, Inc. Our principal executive office is located at 415 Mission St., Suite 5510, San Francisco, CA 94105, and our telephone number is (415) 881-1612. Our website address is www.forgeglobal.com. The information contained in or accessible from our website is not incorporated into this prospectus, and you should not consider it part of this prospectus. We have included our website address in this prospectus solely as an inactive textual reference. Emerging Growth Company The Jumpstart Our Business Startups Act, or the JOBS Act, was enacted in April 2012 with the intention of encouraging capital formation in the United States and reducing the regulatory burden on newly public companies that qualify as emerging growth companies. We are an emerging growth company within the meaning of the JOBS Act. As an emerging growth company, we may take advantage of certain exemptions from various public reporting requirements, including not being required to have our internal control over financial reporting be audited by our independent registered public accounting firm pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, certain reduced disclosure requirements related to the disclosure of executive compensation in this prospectus and in our periodic reports and proxy statements and exemptions from the requirement that we hold a nonbinding advisory vote on executive compensation and any golden parachute payments. We may take advantage of these exemptions until we are no longer an emerging growth company. In addition, under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have elected to use this extended transition period until we are no longer an emerging growth company or until we affirmatively and irrevocably opt out of the extended transition period. Accordingly, our consolidated financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates. We will remain an emerging growth company until the earliest to occur of (i) the last day of the fiscal year in which we have more than $1.07 billion in annual revenue; (ii) the date we qualify as a large accelerated filer, with at least $700 million of equity securities held by non-affiliates; (iii) the date on which we have issued, in any three-year period, more than $1.0 billion in non-convertible debt securities; and (iv) the last day of the fiscal year ending after the fifth anniversary of the completion of this offering. For certain risks related to our status as an emerging growth company, see the section titled Risk Factors Risks Related to Being a Public Company. 6 Table of Contents THE OFFERING The following summary of the offering contains basic information about the offering and our common stock and is not intended to be complete. It does not contain all the information that may be important to you. For a more complete understanding of our common stock, please refer to the section titled Description of Capital Stock. Issuance of Common Stock Shares of Common Stock Offered by us Up to 25,853,271 shares of common stock, $0.0001 par value per share ( common stock ) that are issuable by us upon the exercise of 25,853,271 warrants, consisting of (i) 13,799,940 shares issuable upon exercise of warrants that were underlying units issued by Motive Capital Corp ( Motive ) in its initial public offering ( public warrants ), (ii) 7,386,667 shares underlying warrants initially issued in a private placement in connection with Motive s initial public offering (the private placement warrants ), (iii) 4,666,664 shares underlying warrants issued in the forward purchase units (the forward purchase warrants, and collectively, with the public warrants and the private placement warrants, the warrants ); Up to 1,551,495 shares of common stock reserved for issuance upon exercise of assumed warrants to purchase common stock held by former warrant holders of Forge (the assumed warrants ); and Up to 1,454,131 shares of common stock issuable upon the exercise of certain outstanding options to purchase common stock held by persons who terminated their employment or other relationship with Forge prior to the Closing Date (the Former Employee Options ). Common Stock outstanding prior to the exercise of warrants, assumed warrants and Former Employee Options 169,223,826 shares as of the Closing Date Common Stock outstanding after the exercise of warrants, assumed warrants and certain Former Employee Options 198,082,723 shares, based on total shares outstanding as of the Closing Date Resale of Common Stock and Warrants Shares of Common Stock Offered by the Selling Securityholders Up to 115,289,295 shares of common stock, consisting of (i) up to 6,850,000 shares of common stock (the PIPE shares ) issued in a private placement pursuant to subscription agreements entered into on September 13, 2021 (the PIPE Financing ); (ii) up to 10,350,000 shares of common stock (the founder shares ) issued upon consummation of the Business Combination in exchange for shares of our Class B ordinary shares originally issued in a private placement to Motive s initial shareholders; (iii) up to 14,000,000 shares of common stock (the FPA shares ) issued pursuant to the forward purchase agreement; (iv) up to 12,053,331 shares of common stock underlying the warrants; and (v) up to 72,035,964 shares of common stock issued or issuable to former equity holders of Forge pursuant to the Business Combination. Warrants Offered by the Selling Securityholders 12,053,331 warrants Use of proceeds We may receive up to an aggregate of approximately $302 million from the exercise of all 25,853,271 warrants, 1,551,495 assumed warrants and 1,454,131 Former Employee Options, assuming the exercise in full of such warrants and options for cash. If the 7 Table of Contents warrants are exercised pursuant to a cashless exercise feature, we will not receive any cash from these exercises. Up to approximately 900,000 shares (which represents an estimate of the maximum number of shares that may be issued) issuable pursuant to assumed warrants will be issuable only pursuant to the net exercise provisions thereof, and we will not receive any cash proceeds from such exercises. There is no assurance that warrants, assumed warrants or Former Employee Options will be in the money prior to their expiration or that the holders of such securities will elect to exercise any or all of such securities. We believe the likelihood that these holders will exercise such securities, and therefore any cash proceeds that we may receive in relation to the exercise of such securities being offered for sale in this prospectus, will be dependent on the trading price of our common stock. If the market price for our common stock is less than the exercise price of warrants, assumed warrants or Former Employee Options, we believe the holders of such securities will be unlikely to exercise such securities.We expect to use the net proceeds from the exercise of such warrants and options, if any, for general corporate purposes. See the section of this prospectus titled Use of Proceeds for more information. All of the shares of common stock and warrants offered by the Selling Securityholders pursuant to this prospectus will be sold by the Selling Securityholders for their respective accounts. We will not receive any of the proceeds from these sales. Market for our common stock and warrants Our common stock and warrants are listed on the NYSE under the symbols FRGE and FRGE WS , respectively. Risk Factors See Risk Factors and other information included in this prospectus for a discussion of factors you should consider before investing in our securities. The number of shares of common stock outstanding as of the Closing Date excludes: Up to 25,853,271 shares underlying the warrants at an exercise price of $11.50 per share; Up to 15,039,376 shares of common stock attributable to Forge options prior to the Business Combination, which had a weighted average exercise price of approximately $2.26 per share and 4,557,009 of which are vested; Up to 651,495 shares of common stock attributable to Forge assumed warrants, which had a weighted average exercise price of approximately $3.98 per share; Up to approximately 900,000 shares of common stock attributable to Forge assumed warrants, based on an estimate of the maximum number of shares which may become issuable therefor, pursuant to the terms of such assumed warrants net exercise provisions and the application of the maximum $5.0 million in aggregate fair market value of shares of common stock pursuant to the exercise terms; Up to 12,899,504 shares of common stock reserved for issuance under our 2022 Stock Option and Incentive Plan, plus any annual increases under the terms thereof; and Up to 4,072,000 shares of common stock reserved for issuance under our 2022 Employee Stock Purchase Plan, plus any annual increases under the terms thereof. The number of shares of common stock after giving effect to the exercise of warrants, assumed warrants and Former Employee Options exclude all of the foregoing other than the 25,853,271 shares underlying the warrants, up to 1,551,495 shares underlying the assumed warrants and 1,454,131 shares underlying the Former Employee Options. 8 Table of Contents INFORMATION RELATED TO OFFERED SECURITIES This prospectus relates to the offer and sale from time to time by the Selling Securityholders, or their permitted transferees, of up to 115,289,295 shares of common stock (the Offered Shares ), which include: 6,850,000 PIPE shares issued in the PIPE Financing at $10.00 per share; 10,350,000 founder shares issued upon consummation of the Business Combination, originally issued in a private placement to Motive s initial shareholders at a price of $0.0024 per share; 14,000,000 FPA shares issued as part of the forward purchase units issued pursuant to the forward purchase agreement (the forward purchase units ), at a price of $10.00 per forward purchase unit (with each forward purchase unit consisting of one FPA share and one-third of one warrant); 12,053,331 shares of common stock underlying the Offered Warrants (as defined below); and up to 72,035,964 shares of common stock issued or issuable to former equity holders of Forge pursuant to the Business Combination, acquired at effective purchase prices set forth in the table below. up to 12,053,331 Warrants to purchase shares of common stock (the Offered Warrants ) which include: 7,386,667 private placement warrants, which were purchased at a price of $1.50 per private placement warrant, having an exercise price of $11.50; and 4,666,664 forward purchase warrants, which were included in the forward purchase units, having an exercise price of $11.50. The following table includes information relating to the Offered Shares held by the Selling Securityholders, including the price each Selling Securityholder paid for the Offered Shares, the potential profit relating to such Offered Shares and any applicable lock-up restrictions. The following table is in part based off Forge's internal records and is for illustrative purposes only. The table should not be relied upon for any purpose outside of its illustrative nature. The public offering price in Motive s SPAC IPO was $10.00 per unit, with each unit consisting of one share and one-third of one warrant. Consequently, as seen in the table below, some of the Selling Securityholders may realize a positive rate of return on the sale of their shares of common stock covered by this prospectus even if the market price per share of common stock is below $10.00 per share, in which case the public shareholders may experience a negative rate of return on their investment. Selling Securityholder Number of Offered Shares Effective Purchase Price per Offered Share Potential Profit per Offered Share(1) Lock-Up Restrictions Paul Luc Robert Heyvaert and Entities Affiliated with Motive Partners Founder shares 10,230,000 $ 0.0024 $ 21.88 (2) FPA shares 14,000,000 $ 10.00 $ 11.88 None Shares underlying forward purchase warrants 4,666,664 $ 11.50 $ 10.38 None Shares underlying private placement warrants 7,386,667 $ 11.50 $ 10.38 (2) Former Motive Directors(3) Founder shares 120,000 $ 0.0024 $ 21.88 (2) PIPE Holders PIPE shares 6,850,000 $ 10.00 $ 11.88 None Investors in Forge Global, Inc.(4) 44,402,726 $ 3.77 (5) $ 18.11 180 days Current and Former Forge officers, directors and founders(5) 25,865,621 $ 0.99 (6) $ 20.89 180 days Assumed warrant holders 1,248,716 $ 3.98 (7) $ 17.90 180 days (1) Based on the closing price of our shares of common stock on May 17, 2022 of $21.88. (2) The founder shares and private placement warrants (the Sponsor Lockup Securities ) are subject to the following restrictions: (a) one-third of the founder shares will be subject to a one year lock-up, and will be released from such lock-up if the closing price of our common stock equals or exceeds $12.00 for any 20 trading days in a 30-consecutive trading day period commencing 150 days post-Closing, (b) one-third of the private placement warrants will be subject to a six month lock-up, (c) one-third of the Sponsor 9 Table of Contents Lockup Securities will be subject to a three year lock-up, and will be released from such lock-up no earlier than six months post-Closing if the closing price our common stock equals or exceeds $12.50 for any 20 trading days in a 30-consecutive trading day period post-Closing, and (d) one-third of the Sponsor Lockup Securities will be subject to a three year lock-up, and will be released from such lock-up no earlier than six months after the Closing if the closing price our common stock equals or exceeds $15.00 for any 20 trading days in a 30-consecutive trading day period post-Closing. (3) Includes Jill M. Considine, Stephen C. Daffron, Dina Dublon and Paula Madoff. (4) Includes Ossa Investments Pte. Ltd., Deutsche Borse AG, entities affiliated with Operative Capital, entities affiliated with Panorama and entities affiliated with FTP. (5) Includes Christoph Hansmeyer, Stephen George, Steven McLaughlin, Kelly Rodriques, Mark Lee, Jose Cobos, Norbert Ngethe, Sohail Prasad, Samvit Ramadurgam, Gil Silberman and Asiff Hirji. (6) Consists of common stock issued as founder shares, common stock issued for services, common stock issued upon the exercise of stock options and common stock issuable pursuant to assumed warrants and assumed stock options. (7) Consists of shares of common stock underlying assumed warrants having an exercise price of $3.98 per share. Up to approximately 900,000 shares (which represents an estimate of the maximum number of shares that may be issued) issuable pursuant to assumed warrants will be issuable only pursuant to the net exercise provisions thereof, and we will not receive any cash proceeds from such exercises. 10 Table of Contents CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS Certain statements in this prospectus may constitute forward-looking statements for purposes of the federal securities laws. Our forward-looking statements include, but are not limited to, statements regarding our or our management team s expectations, hopes, beliefs, intentions or strategies regarding the future. In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words anticipate, believe, contemplate, continue, could, estimate, expect, intends, may, might, plan, possible, potential, predict, project, should, will, would and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements in this prospectus may include, for example, statements about the Company s ability to: execute its business strategy, including monetization of services provided and expansions in and into existing and new lines of business; manage risks associated with macroeconomic conditions resulting from the global COVID-19 pandemic, including new variant strains of the underlying virus, current or anticipated military conflict, including between Russia and Ukraine, terrorism, sanctions, rising energy prices, inflation and interest rates and other geopolitical events globally; comply with laws and regulations applicable to its business; stay abreast of modified or new laws and regulations applying to Forge s business; realize the benefits expected from the Business Combination; anticipate the uncertainties inherent in the development of new business lines and business strategies; retain and hire necessary employees; increase brand awareness; access, collect and use personal data about consumers; attract, train and retain effective officers, key employees or directors; upgrade and maintain information technology systems; acquire and protect intellectual property; meet future liquidity requirements; effectively respond to general economic and business conditions; maintain the listing of Forge s securities on the NYSE or another national securities exchange; obtain additional capital, including use of the debt market; enhance future operating and financial results; execute its business strategy, including monetization of services provided and expansions in and into existing and new lines of business; anticipate rapid technological changes; anticipate the impact of, and response to, new accounting standards; 11 Table of Contents respond to fluctuations in foreign currency exchange rates and political unrest and regulatory changes in international markets from various events; maintain key strategic relationships with partners; respond to uncertainties associated with product and service development and market acceptance; manage to finance operations on an economically viable basis; successfully defend litigation; successfully deploy the proceeds from the Business Combination; and other factors detailed under the section entitled Risk Factors of this prospectus. These forward-looking statements are based on information available as of the date of this prospectus and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. These and other factors that could cause actual results to differ from those implied by the forward-looking statements in this prospectus are more fully described under the heading Risk Factors and elsewhere in this prospectus. The risks described under the heading Risk Factors are not exhaustive. New risk factors emerge from time to time and it is not possible to predict all such risk factors, nor can Forge assess the impact of all such risk factors on its business, or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements attributable to Forge or persons acting on their behalf are expressly qualified in their entirety by the foregoing cautionary statements. Forge undertakes no obligations to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. 12 Table of Contents RISK FACTORS Investing in our securities involves a high degree of risk. You should carefully consider the risks and uncertainties described below, together with the other information in this prospectus, including our consolidated financial statements and the related notes appearing at the end of this prospectus and in the section titled Management s Discussion and Analysis of Financial Condition and Results of Operations, before deciding whether to invest in our securities. The occurrence of one or more of the events or circumstances described in these risk factors, alone or in combination with other events or circumstances, may have a material adverse effect on our business, reputation, revenue, financial condition, results of operations and future prospects, in which event the market price of our common stock could decline, and you could lose part or all of your investment. Unless otherwise indicated, reference in this section and elsewhere in this prospectus to our business being adversely affected, negatively impacted or harmed will include an adverse effect on, or a negative impact or harm to, the business, reputation, financial condition, results of operations, revenue and our future prospects. The material and other risks and uncertainties summarized above and described below are not intended to be exhaustive and are not the only ones we face. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also impair our business operations. This prospectus also contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in the forward-looking statements as a result of a number of factors, including the risks described below. See the section titled Cautionary Note Regarding Forward-Looking Statements. Risks Related to Our Business We have a history of losses and may not achieve or maintain profitability in the future. Our net loss was $64.4 million and net income was $0.9 million for the three months ended March 31, 2022 and 2021, respectively. As of March 31, 2022, we had an accumulated deficit of $286.0 million. We may continue to incur net losses in the future. We will need to generate and sustain significant revenue for our business generally in future periods in order to achieve and maintain profitability. We also expect general and administrative expenses to increase to meet the increased compliance and other requirements associated with operating as a public company and evolving regulatory requirements. Our efforts to grow our business may be more costly than we expect, and we may not be able to increase our revenue sufficiently to offset our higher operating expenses. We may continue to incur losses, and we may not achieve or maintain future profitability due to a number of reasons, including the risks described in this prospectus, unforeseen expenses, difficulties, complications and delays, and other unknown events. Furthermore, if our future growth and operating performance fail to meet investor or analyst expectations, or if we have future negative cash flow or losses resulting from expanding our operations, this could make it difficult for you to evaluate our current business and our future prospects and have a material adverse effect on our business, financial condition and results of operations. We face intense and increasing competition and, if we do not compete effectively, our competitive positioning and our operating results will be harmed. Some of our current and potential competitors have longer operating histories, particularly with respect to our financial services business, significantly greater financial, technical, marketing and other resources and a larger customer base than we do. We expect our competition to continue to increase. In addition to established enterprises and global banks, we may also face competition from early-stage companies attempting to capitalize on the same, or similar, opportunities as we are. Some of our current and potential competitors have longer operating histories, significantly greater financial, technical, marketing, and other resources and a larger customer base than we do. Any of these advantages would allow competitors to potentially offer more competitive pricing or other terms or features, a broader range of investment and financial products, or a more specialized set of specific products or services, as well as respond more quickly than we can to new or emerging technologies and changes in customer preferences, among other items. Our existing or future competitors may develop products or services that are similar to our products and services or that achieve greater market acceptance than our products and services, which could attract new customers away from our services and reduce our market share in the future. Additionally, when new competitors seek to enter our markets, or when existing market participants seek to increase their market share, these competitors sometimes undercut, or otherwise exert pressure on, the pricing terms prevalent in that market, which could adversely affect our revenues, market share or ability to capitalize on new market opportunities. 13 Table of Contents Our customers may encounter difficulties with investing through our platform, and face risks including those related to a lack of information available about private companies, liquidity concerns and potential transfer or sale restrictions with respect to securities offered on our platform. Institutions and individual investors face significant risk when buying securities on our market, which may make our product offerings generally less attractive. These risks include the following: private companies may exercise their right of first refusal over the securities or otherwise prohibit the transfer of the securities, and therefore certain securities on our platform may not be available to certain investors; private companies are not required to make periodic public filings, and therefore certain capitalization, operational and financial information may not be available for evaluation; an investment may only be appropriate for investors with a long-term investment horizon and a capacity to absorb a loss of some or all of their investment; the securities, when purchased, are generally highly illiquid, are often subject to further transfer restrictions, and no public market exists for such securities; post-IPO transfer restrictions, including lock-up restrictions, may ultimately limit the ability to sell the securities on the open market; and transactions may fail to settle, which could harm our reputation. We have been or are involved in, and may in the future become involved in, disputes or litigation matters between customers with respect to failed transactions on our platform (such as in the event of delayed delivery or a failure to deliver securities). We have been or are involved in, and may in the future become involved in, disputes and litigation matters between customers with respect to transactions on our platform. The high notional value of transactions on our platform makes us a target for clients to engage in lawsuits between one another and/or with us. There is a risk that clients may increasingly look to us to make them whole for delayed and/or broken trades. Customers may litigate over a failure of sellers to deliver securities or over the untimely deliveries of securities. Any litigation to which we are a party could be expensive and time consuming, regardless of the ultimate outcome, and the potential costs and risks of such litigation may incentivize us to settle. Additionally, we may agree to forego commissions in a failed settlement situation even if we are not at fault or do not have an obligation to do so for customer relations or other reasons. If we reduce or forego commissions on behalf of clients, it would lead to a reduction in profits. There is no assurance that our revenue and business models will be successful. The majority of our revenue is derived from commissions earned on securities-based transactions, or placement fees. We maintain a comprehensive trading platform which generates revenue through our Forge Markets offering by volume-based fees sourced from institutions, individual investors and shareholders. We also generate revenues through our Forge Trust offering with account fees, cash management fees and partnership fees through custodial offerings, or Custodial Management Fees for all Forge customers and also recently through our Forge Data and Forge Company Solutions services. With respect to placement fees, a decline in the price of securities transactions brokered by us, or a decline in the financial markets generally, or a decline in fee rates could negatively impact our revenue and overall financial position. Additionally, if we fail to acquire and retain new institutions, individual investors and shareholders, or fail to do so in a cost-effective manner, we may be unable to increase revenue and achieve profitability for our Forge Markets and Forge Trust offerings. Additionally, our Forge Data and Forge Company Solutions offerings are nascent and unproven. These offerings may not gain market acceptance or prove to be profitable. While some of our issuer customers may prefer that we not publish the transaction prices for transactions in their securities, which could impact our Forge Data services and Forge Markets offerings, we maintain that such prices are, by definition, information belonging to us. We negotiate exceptions to this policy on a case-by-case basis, and such exceptions have historically been very limited. 14 Table of Contents We are continually refining our revenue and business model, which is premised on creating a virtuous cycle for our clients to engage in more products across our platform. We promote our Forge Data services and Forge Company Solutions product offerings to the institutions, individual investors and shareholders who initially partake in our markets offering. There is no assurance that these efforts will be successful or that we will generate revenues commensurate with our efforts and expectations, or become profitable. We may be forced to make significant changes to our revenue and business model to compete with our competitors offerings, and even if such changes are undertaken, there is no guarantee that they will be successful. Additionally, we will likely be required to hire, train and integrate qualified personnel to meet and further our business objectives, and our ability to successfully do so is uncertain. If we are unable to develop new solutions or adapt to technological changes, our revenue may not grow as expected. We operate in a dynamic industry characterized by rapidly evolving technology, frequent product introductions, and competition based on pricing and other differentiators. Our scalability could be contingent on us successfully building a mobile app for our services, which may be expensive and time consuming, and the success of which is not guaranteed. In addition, we may increasingly rely on technological innovation as we introduce new types of products, expand our current products into new markets, and continue to streamline our platform. The process of developing new technologies and products is complex, and if we are unable to successfully innovate and continue to deliver a superior experience, demand for our products may decrease and our growth and operations may be harmed. Our projections and key performance metrics are subject to significant risks, assumptions, estimates, judgments and uncertainties. As a result, our financial and operating results may differ materially from our expectations. We operate in a competitive industry, and our projections and calculations of key operating metrics are subject to the risks and assumptions made by management with respect to our industry. Operating results are difficult to forecast because they generally depend on a number of factors, including the competition we face, as well as our ability to attract and retain customers while generating sustained revenues through our services. We may be unable to adopt measures in a timely manner to compensate for any unexpected shortfall in income. Any of these factors could cause our operating results in a given quarter to be higher or lower than expected, which makes creating accurate forecasts and budgets challenging. As a result, we may fall materially short of our forecasts and expectations, including with respect to our key operating metrics, which could cause our stock price to decline and investors to lose confidence in us and our business, financial condition, and results of operations could be materially and adversely affected. Our estimates regarding the size of our addressable market may prove to be inaccurate. It may be difficult to accurately estimate the size of the private markets and predict with certainty the rate at which the market for our products will grow, if at all. If there is a trend away from late stage private companies allowing secondary trading, either influenced by our business or otherwise, this would tend to reduce the addressable market available to capture revenue for Forge Markets. While our market size estimates are made in good faith and are based on assumptions and estimates we believe to be reasonable, these estimates may not be accurate. If our estimates of the size of our addressable market are not accurate, our potential for future growth may be less than we currently anticipate, which could have a material adverse effect on our business, financial condition, and results of operations. If we fail to effectively manage any future growth, our business, operating results, and financial condition could be adversely affected. We have and expect to continue to experience significant growth, particularly following the SharesPost acquisition, and intend to continue to significantly expand our operations, including our employee headcount. This growth has placed, and will continue to place, significant demands on our management and operational and financial infrastructure. In addition, we are required to continuously develop and adapt our systems and infrastructure in response to the increasing sophistication of the financial services market, evolving fraud and information security landscape, and regulatory developments relating to existing and projected business activities. Our future growth will depend, among other things, on our ability to maintain an operating platform and management system apt to address such growth, and will require us to incur significant additional expenses, expand our workforce and commit additional senior management and operational resources. 15 Table of Contents To manage our growth effectively, we must continue to improve our operational, financial, and management systems and controls by, among other things: effectively attracting, training, integrating, and retaining a large number of new employees; further improving our key business systems, processes, and information technology infrastructure, including our and third-party services, to support our business needs; enhancing our information, training, and communication systems to ensure that our employees are well-coordinated and can effectively communicate with each other and our customers; and improving our internal control over financial reporting and disclosure controls and procedures to ensure timely and accurate reporting of our operational and financial results. If we fail to manage our expansion, implement improvements, or maintain effective internal controls and procedures, our costs and expenses may increase more than we plan and we may lose the ability to develop new solutions, satisfy our customers, respond to competitive pressures, or otherwise execute our business plan. If we are unable to manage our growth, our business, financial condition, and results of operations could be materially and adversely affected. We may require additional capital to satisfy our liquidity needs and support business growth and objectives, and this capital might not be available to us on reasonable terms, if at all, and may be delayed or prohibited by applicable regulations. Maintaining adequate liquidity is crucial to our securities brokerage business operations, including key functions such as transaction settlement and custody requirements. We meet our liquidity needs primarily from working capital and cash generated by customer activity, as well as from external equity financing. Increases in the number of customers, fluctuations in customer cash or deposit balances, as well as market conditions or changes in regulatory treatment of customer deposits, may affect our ability to meet our liquidity needs. Our broker-dealer subsidiary, Forge Securities, LLC ( Forge Securities ), is subject to Rule 15c3-1 under the Exchange Act, which specifies minimum capital requirements intended to ensure the general financial soundness and liquidity of broker-dealers, and Forge Securities is subject to Rule 15c3-3 under the Exchange Act, which requires broker-dealers to maintain certain liquidity reserves. Additionally, our trust company subsidiary, Forge Trust, is subject to minimum capital requirements of the State of South Dakota, in which it is chartered. A reduction in our liquidity position could reduce our customers confidence in us, which could result in the withdrawal of customer assets and loss of customers, or could cause us to fail to satisfy broker-dealer or other regulatory capital guidelines, which may result in immediate suspension of securities activities, regulatory prohibitions against certain business practices, increased regulatory inquiries and reporting requirements, increased costs, fines, penalties or other sanctions, including suspension or expulsion by the SEC, FINRA or other self-regulatory organizations or state regulators, and could ultimately lead to the liquidation of our broker-dealers or other regulated entities. In addition to requiring liquidity for our securities brokerage business and our other regulated businesses, we may also require additional capital to continue to support the growth of our business and respond to competitive challenges, including the need to promote our products and services, develop new products and services, enhance our existing products, services and operating infrastructure, and acquire and invest in complementary companies, businesses and technologies. When available cash is not sufficient for our liquidity and growth needs, we may need to engage in equity or debt financings to secure additional funds. There can be no assurance that such additional funding will be available on terms attractive to us, or at all, and our inability to obtain additional funding when needed could have an adverse effect on our business, financial condition and results of operations. If additional funds are raised through the issuance of equity or convertible debt securities, our stockholders could suffer significant dilution, and any new shares we issue in connection therewith could have rights, preferences and privileges superior to those of our current stockholders. Any debt financing secured by us in the future could involve restrictive covenants relating to our capital-raising activities and other financial and operational matters, which may make it more difficult for us to obtain additional capital and to pursue future business opportunities. 16 Table of Contents We have in the past consummated and, from time to time we may evaluate and potentially consummate, acquisitions, which could require significant management attention, result in additional dilution to our stockholders, increase expenses and disrupt our business and adversely affect our financial results. Our success will depend, in part, on our ability to expand our business. In some circumstances, we may determine to do so through the acquisition of complementary assets, businesses and technologies rather than through internal development. The identification of suitable acquisition candidates can be difficult, time-consuming and costly, and we may not be able to successfully complete or integrate acquisitions. The risks we face in connection with acquisitions include: diversion of management time and focus from operating our business to addressing acquisition integration challenges; coordination of technology, product development, risk management and sales and marketing functions; retention of employees from the acquired company, and retention of our employees who were attracted to us because of our smaller size or for other reasons; cultural challenges associated with integrating employees from the acquired company into our organization; integration of the acquired company s accounting, management information, human resources and other administrative systems; the need to implement or improve controls, procedures and policies at a business that prior to the acquisition may have lacked effective controls, information security safeguards, procedures and policies; potential write-offs or impairments of intangible assets or other assets acquired in the acquisition; liability for activities of the acquired company before the acquisition, including intellectual property infringement claims, violations of laws, commercial disputes, tax liabilities and other known and unknown liabilities; litigation or other claims in connection with the acquired company, including claims from terminated employees, subscribers, former shareholders or other third parties; and geographic expansion that may expose our business to known and unknown regulatory compliance risks including elevated risk factors for tax compliance, money laundering controls, and supervisory controls oversight. Our failure to address these risks or other problems encountered in connection with our acquisitions and investments could cause us to fail to realize the anticipated benefits of these acquisitions or investments, cause us to incur unanticipated liabilities and harm our business, generally. Future acquisitions could also result in dilutive issuances of our equity securities, the incurrence of debt, contingent liabilities, regulatory obligations to further capitalize our business, and goodwill and intangible asset impairments, any of which could harm our financial condition and negatively impact our shareholders. To the extent we pay the consideration for any future acquisitions or investments in cash, it would reduce the amount of cash available to us for other purposes. In addition, to the extent we issue equity securities to pay for any such acquisitions or investments, any such issuances of additional capital stock may cause stockholders to experience significant dilution of their ownership interests and the per share value of our common stock to decline. We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing military conflict between Russia and Ukraine. Our business may be adversely affected by any negative impact on the global economy and capital markets resulting from the conflict in Ukraine or any other geopolitical tensions. U.S. and global markets are experiencing volatility and disruption following the escalation of geopolitical tensions and the start of the military conflict between Russia and Ukraine. Although the length and impact of the ongoing military conflict is highly unpredictable, the conflict in Ukraine has led and is likely to continue to lead to market disruptions, including significant volatility in commodity prices, credit and capital markets, as well as supply chain interruptions. We are continuing to monitor the situation in Ukraine and globally and assessing its potential impact on our business. The events have led to sanctions and other penalties being 17 Table of Contents levied by the United States, European Union and other countries against Russia and Belarus, including agreement to remove certain Russian financial institutions from the Society for Worldwide Interbank Financial Telecommunication ( SWIFT ) payment system, expansive ban on imports and exports of products to and from Russia and ban on exportation of U.S. denominated banknotes to Russia or persons located there. Additional potential sanctions and penalties have also been proposed and/or threatened. While the situation is still evolving, and the outcomes remain highly uncertain, there is a risk that, in addition to having a negative impact on the global economy and capital markets, such events could have an unfavorable impact on the behavior of our customers, including changes in their investment preferences. The long-term impact of the COVID-19 pandemic on our business, financial condition and results of operations is uncertain. The COVID-19 pandemic and the various measures instituted by governments and businesses to mitigate its spread, including travel restrictions, stay-at-home orders and quarantine restrictions, has had and is likely to continue to have an adverse impact on our customers, employees and business partners, and may continue to disrupt our operations. The COVID-19 pandemic has resulted, in part, in inefficiencies or delays in our business, operational challenges, additional costs related to business continuity initiatives as our workforce has transitioned to remote working and increased vulnerability to cybersecurity attacks or other privacy or data security incidents. The extent of the impact of COVID-19 on our business, financial condition and results of operations will depend largely on future developments, including the duration of the pandemic, the severity of renewed outbreaks, actions taken to contain COVID-19 or address its impact, the ability to reintegrate our workforce or of our workforce to adapt to the long-term distributed workforce model (with some employees part- or full-time remote, and others not) we expect to adopt, the impact on capital and financial markets and the global economy in general, and the related impact on the financial circumstances of our customers, all of which are highly uncertain and cannot be predicted. Even after the COVID-19 pandemic has subsided, we may continue to experience adverse impacts to our business as a result of the global economic impact, including the availability of credit, adverse impacts on our liquidity and any recession that has occurred or may occur in the future. In addition, we may not be able to maintain the customer base we gained, or the rate of growth in our customer base that we experienced, throughout the COVID-19 pandemic. A sustained or prolonged COVID-19 pandemic or a resurgence, such as an outbreak of a new variant, could exacerbate the factors described above and intensify the impact on our business, financial condition and results of operations. If we fail to attract new customers, or fail to do so in a cost-effective manner, our business may be harmed. Our continued business and revenue growth is dependent on our ability to attract new customers, retain existing customers increase the amount that our customers use our products, and we cannot be sure that we will be successful in these efforts. As we expand our business operations and enter new markets, new challenges in attracting and retaining customers will arise that we may not successfully address. Our success, and our ability to increase revenues and operate profitably, depends in part on our ability to cost-effectively acquire new customers, to retain existing customers and to keep existing customers engaged so that they continue to use our products and services. Our business depends on our trusted brand, and failure to maintain and protect our brand, or any damage to our reputation, or the reputation of our partners, could adversely affect our business, financial condition or results of operations. We believe we are developing a trusted brand that has contributed to the success of our business. We believe that maintaining and promoting our brand in a cost-effective manner is critical to achieving widespread acceptance of our products and services and expanding our base of customers. Maintaining, promoting and positioning our brand and reputation will depend on our ability to continue to provide useful, reliable, secure, and innovative products and services; to maintain trust and remain a financial services leader; and to provide a consistent, high-quality customer experience. We may introduce, or make changes to, features, products, services, privacy practices, or terms of service that customers do not like, which may materially and adversely affect our brand. Our brand promotion activities may not generate customer awareness or increase revenue, and even if they do, any increase in revenue may not offset the expenses we incur in building our brand. If we fail to successfully promote and maintain our brand or if we incur excessive expenses in this effort, our business could be materially and adversely harmed. Harm to our brand can arise from many sources, including failure by us or our partners and service providers to satisfy expectations of service and quality, inadequate protection or misuse of personally identifiable information, compliance failures and claims, regulatory inquiries and enforcement, rumors, litigation and other claims, misconduct by our partners, employees or other counterparties, and actual or perceived failure to adequately address the environmental, social, and governance expectations of our various stakeholders, any of which could lead to a tarnished reputation and loss of customers. We may in the future be the target of 18 Table of Contents incomplete, inaccurate, and misleading or false statements about our company and our business that could damage our brand and deter customers from adopting our services. Any negative publicity about our industry or our company, the quality and reliability of our products and services, our compliance and risk management processes, changes to our products and services, our privacy, data protection, and information security practices, litigation, regulatory licensing and infrastructure, and the experience of our customers with our products or services could adversely affect our reputation and the confidence in and use of our products and services. If we do not successfully maintain a strong and trusted brand, our business, financial condition, and results of operations could be materially and adversely affected. We conduct our brokerage and other business operations through subsidiaries and may in the future rely on dividends from our subsidiaries for a substantial amount of our cash flows. We may in the future depend on dividends, distributions and other payments from our subsidiaries to fund payments on our obligations, including any debt obligations we may incur. Regulatory and other legal restrictions may limit our ability to transfer funds to or from certain subsidiaries, including Forge Securities. In addition, certain of our subsidiaries are subject to laws and regulations that authorize regulatory bodies to block or reduce the flow of funds to us, or that prohibit such transfers altogether in certain circumstances. These laws and regulations may hinder our ability to access funds that we may need to make payments on our obligations, including any debt obligations we may incur and otherwise conduct our business by, among other things, reducing our liquidity in the form of corporate cash. In addition to negatively affecting our business, a significant decrease in our liquidity could also reduce investor confidence in us. Certain rules and regulations of the SEC and FINRA may limit the extent to which our broker-dealer subsidiary may distribute capital to us. For example, under SEC rules applicable to Forge Securities, a dividend in excess of 30% of a member firm s excess net capital may not be paid without Forge Securities providing prior written notice. Compliance with these rules may impede our ability to receive dividends, distributions and other payments from Forge Securities. Fluctuations in interest rates could impact our business. Fluctuations in interest rates may adversely impact our customers general spending levels and risk appetite and ability and willingness to invest through our platform. Additionally, some of our services, such as our Forge Trust services, are affected by interest rate changes. Low interest rates directly reduce our ability to earn cash administration fees from our Forge Trust services, which would adversely affect our business, financial condition, results of operations, cash flows and future prospects. Our reported financial results may be adversely affected by changes in accounting principles generally accepted in the United States. Generally accepted accounting principles in the United States are subject to interpretation by the Financial Accounting Standards Board, the American Institute of Certified Public Accountants, the SEC and various bodies formed to promulgate and interpret appropriate accounting principles. A change in these principles or interpretations could have a significant effect on our reported financial results, and could affect the reporting of transactions completed before the announcement of a change. Our business and reputation may be harmed by changes in business, economic or political conditions that impact global financial markets, or by a systemic market event. As a financial services company, our business, results of operations and reputation are directly affected by elements beyond our control, such as economic and political conditions, changes in the volatility in financial markets (including volatility as a result of the COVID-19 pandemic), significant increases in the volatility or trading volume of particular securities, broad trends in business and finance, changes in volume of securities trading generally, changes in the markets in which such transactions occur and changes in how such transactions are processed. These elements can arise suddenly and the full impact of such conditions can remain uncertain. A prolonged weakness in equity markets, such as a slowdown causing reduction in trading volume in securities, derivatives or cryptocurrency markets, may result in reduced revenues and would have an adverse effect on our business, financial condition and results of operations. Significant downturns in the securities markets or in general economic and political conditions may also cause individuals to be reluctant to make their own investment decisions and thus decrease the demand for our products and services and could also result in our customers reducing their engagement with our platform. Conversely, significant upturns in the securities markets or in general economic and political conditions may cause individuals to be less proactive in seeking ways to improve the returns on their trading or investment decisions and, thus, decrease the demand for our products and services. Any of these changes could cause our future performance to be uncertain or unpredictable, and could have an adverse effect on our business, financial condition and results of operations. 19 Table of Contents In addition, some market participants could be overleveraged. In case of sudden, large price movements, such market participants may not be able to meet their obligations to their respective brokers who, in turn, may not be able to meet their obligations to their counterparties. As a result, the financial system or a portion thereof could suffer, and the impact of such an event could have an adverse effect on our business, financial condition and results of operations. In addition, a prolonged weakness in the U.S. equity markets or a general economic downturn could cause our customers to incur losses, which in turn could cause our brand and reputation to suffer. If our reputation is harmed, the willingness of our existing customers, and potential new customers, to do business with us could be negatively impacted, which would adversely affect our business, financial condition and results of operations. We are also monitoring developments related to the U.K. formally leaving the European Union ( EU ) on January 31, 2020 ( Brexit ) following the end of the transition period on December 31, 2020. While the EU and the U.K. agreed to the EU-UK Trade and Cooperation Agreement, which took effect on January 1, 2021, to establish some of the key aspects of the U.K. and EU post-Brexit relationship, it is incomplete, and the full effects of Brexit are uncertain. Brexit and the EU-U.K. Trade and Cooperation Agreement could have implications for our U.K. subsidiary and could lead to economic and legal uncertainty, including significant volatility in global stock markets and currency exchange rates, and increasingly divergent laws, regulations and licensing requirements for any operations we conduct or may conduct in the U.K. or EU in the future as the U.K. determines which EU laws to replace or replicate. Any of these effects of Brexit, among others, could adversely affect our operations and financial results. Any failure by us to maintain effective internal controls over financial reporting could have an adverse effect on our business, financial condition and results of operations. The Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures and internal control over financial reporting. We are continuing to develop and refine our disclosure controls and other procedures that are designed to ensure that information required to be disclosed by us in the reports that we will file with the SEC is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and that information required to be disclosed in reports under the Exchange Act is accumulated and communicated to our principal executive and financial officers. We are also continuing to develop and refine our internal control over financial reporting. Some members of our management team have limited or no experience managing a publicly traded company, interacting with public company investors, and complying with the increasingly complex laws pertaining to public companies, and we have limited accounting and financial reporting personnel and other resources with which to address our internal controls and related procedures. In order to maintain and improve the effectiveness of our disclosure controls and procedures and internal control over financial reporting, we have expended, and anticipate that we will continue to expend, significant resources, including accounting-related costs and significant management oversight. Our current controls and any new controls that we develop may become inadequate because of changes in conditions in our business. In addition, changes in accounting principles or interpretations could also challenge our internal controls and require that we establish new business processes, systems and controls to accommodate such changes. We have limited experience with implementing the systems and controls that are necessary to operate as a public company, as well as adopting changes in accounting principles or interpretations mandated by the relevant regulatory bodies. Additionally, if these new systems, controls or standards and the associated process changes do not give rise to the benefits that we expect or do not operate as intended, it could adversely affect our financial reporting systems and processes, our ability to produce timely and accurate financial reports or the effectiveness of our internal control over financial reporting. Moreover, our business may be harmed if we experience problems with any new systems and controls that result in delays in their implementation or increased costs to correct any post-implementation issues that may arise. Further, weaknesses in our disclosure controls and internal control over financial reporting may be discovered in the future. Any failure to develop or maintain effective controls or any difficulties encountered in their implementation or improvement could harm our business or cause us to fail to meet our reporting obligations and may result in a restatement of our consolidated financial statements for prior periods. Any failure to implement and maintain effective internal control over financial reporting could also adversely affect the results of periodic management evaluations and annual independent registered public accounting firm attestation reports regarding the effectiveness of our internal control over financial reporting that we will eventually be required to include in our periodic reports that will be filed with the SEC. Ineffective disclosure controls and procedures or internal control over financial reporting could also cause investors to lose confidence in the accuracy and completeness of our reported financial and other information, which would likely have a negative effect on the trading price of our shares. In addition, if we are unable to continue to meet these requirements, we may not be able to remain listed on the NYSE. As a public company, we are required to provide an annual management report on the effectiveness of our internal control over financial reporting commencing with our second Annual Report on Form 10-K. 20 Table of Contents Our independent registered public accounting firm is not required to formally attest to the effectiveness of our internal control over financial reporting until the later of (1) our second Annual Report on Form 10-K or (2) the Annual Report on Form 10-K for the first year we no longer qualify as an emerging growth company. At such time, our independent registered public accounting firm may issue a report that is adverse in the event it is not satisfied with the level at which our internal control over financial reporting is documented, designed or operating. Any failure to maintain effective disclosure controls and internal control over financial reporting could harm our business and could cause a decline in the trading price of our shares. In addition, we could become subject to investigations by the stock exchange on which our securities are listed, the SEC or other regulatory authorities, which could require additional financial and management resources. These events could have a material and adverse effect on our business, results of operations, financial condition and prospects. If our goodwill, or other intangible assets, or fixed assets become impaired, we may be required to record a charge to our earnings. We are required to test goodwill for impairment at least annually or earlier if events or changes in circumstances indicate the carrying value may not be recoverable. As of March 31, 2022, we had recorded a total of approximately $4.4 million of goodwill and other intangible assets. An adverse change in domestic or global market conditions, particularly if such change has the effect of changing one of our critical assumptions or estimates made in connection with the impairment testing of goodwill or intangible assets, could result in a change to the estimation of fair value that could result in an impairment charge to our goodwill or other intangible assets. Any such material charges may have a negative impact on our operating results or financial condition. Regulatory, Tax and Legal Risks Our business is subject to extensive laws and regulations promulgated by U.S. state, U.S. federal and non-U.S. laws, including those applicable to broker dealers, investment advisers and alternative trading systems, including regulation by the SEC and FINRA in the jurisdictions in which we operate. Compliance with laws and regulations require significant expense and devotion of resources, which may adversely affect our ability to operate profitably. We offer investment management services through Forge Global Advisors, an investment adviser registered under the Investment Advisers Act of 1940, as amended (the Advisers Act ), which is subject to regulation by the SEC. Forge Securities is an affiliated registered broker-dealer and FINRA member. Investment advisers are subject to the anti-fraud provisions of the Advisers Act and to fiduciary duties derived from these provisions, which apply to our relationships with the funds we manage. These provisions and duties impose restrictions and obligations on us with respect to our dealings with our customers, fund investors and our investments, including for example restrictions on transactions with our affiliates. Our investment adviser is subject to periodic SEC examinations. Our investment adviser is also subject to other requirements under the Advisers Act and related regulations primarily intended to benefit advisory customers. These additional requirements relate to matters including maintaining effective and comprehensive compliance programs, record-keeping and reporting and disclosure requirements. The Advisers Act generally grants the SEC broad administrative powers, including the power to limit or restrict an investment adviser from conducting advisory activities in the event it fails to comply with federal securities laws. Additional sanctions that may be imposed for failure to comply with applicable requirements include the prohibition of individuals from associating with an investment adviser, the revocation of registrations and other censures and fines. Even if an investigation or proceeding did not result in a sanction or the sanction imposed against us or our personnel by a regulator were small in monetary amount, the adverse publicity relating to the investigation, proceeding or imposition of these sanctions could harm our reputation and cause us to lose existing customers or fail to gain new customers. Our subsidiary, Forge Securities, is a registered broker-dealer and FINRA member and operates an alternative trading system which files reports with the SEC. The securities industry is highly regulated, including under federal, state and other applicable laws, rules, and regulations, and we may be adversely affected by regulatory changes related to suitability of financial products, supervision, sales practices, advertising, private placements, application of fiduciary standards, best execution, and market structure, any of which could limit our business and damage our reputation. FINRA has adopted extensive regulatory requirements relating to sales practices, advertising, registration of personnel, compliance and supervision, and compensation and disclosure, to which Forge Securities and its personnel are subject. FINRA and the SEC also have the authority to conduct periodic examinations of Forge Securities, and may also conduct administrative proceedings. Additionally, material expansions of the business in which Forge Securities engages are subject to approval by FINRA. This could delay, or even prevent, the firm s ability to expand its securities and brokerage offerings in the future. 21 Table of Contents We are subject to extensive, complex and evolving laws, rules and regulations, which are subject to change and which are interpreted and enforced by various federal, state and local government authorities and self-regulatory organizations. The ultimate impact of these laws and regulations remains uncertain, but may adversely affect our ability to operate profitably. We are subject to various federal, state and local regulatory regimes. The principal policy objectives of these regulatory regimes are to protect borrowers, investors, and other financial services customers and to prevent fraud, money laundering, and terrorist financing. Laws and regulations, among other things, impose licensing and qualifications requirements; require various disclosures and consents; mandate or prohibit certain terms and conditions for various financial products; prohibit discrimination based on certain prohibited bases; prohibit unfair, deceptive, or abusive acts or practices; require us to submit to examinations by federal, state and local regulatory regimes; and require us to maintain various policies, procedures and internal controls, including in some cases, internal information barriers. There is a risk that our affiliated entities will not maintain proper information barriers if we fail to develop and enforce appropriate policies and procedures regarding information barriers between entities. The introduction of new laws and regulations related to our businesses, and changes in the enforcement of existing laws and regulations, could have a negative impact on our results and ability to operate. For example, recent news articles and statements from SEC commissioners have raised the possibility of additional transparency from large private companies. The reports indicate that the SEC will consider plans to require more private companies to routinely disclose information about their finances and operations. Currently, federal statute requires companies with more than 2,000 shareholders of record to register their securities with the SEC, but the SEC also allows an unlimited number of people to own shares in street name (through the same broker or investment vehicle) and count as one shareholder. The reports indicate that the SEC may decide to look through certain vehicles and count underlying investors as distinct shareholders. Forge facilitates investments in certain issuers by way of special purpose vehicles ( SPVs ). If the SPVs were to be looked through to their underlying investors, issuers may be less amenable to funding from SPVs, including those facilitated on the Forge platform. If new laws and regulations require certain private companies to publicly report, those companies may be incentivized to go public, which could decrease the number of issuers on our platform. On the other hand, if increased disclosure obligations do not drive impacted issuers to go public, the increased transparency could drive growth and interest in our platform. As another example, Forge Trust, a South Dakota non-depository trust company and one of our wholly owned subsidiaries, is authorized to act as a custodian of self-directed individual retirement accounts. The United States Congress has recently proposed draft legislation that would significantly limit the types of investments and amounts that may be held in individual retirement accounts which, if enacted as proposed or substantially similar form, could negatively impact our current and future Forge Trust account holders and have an adverse effect on our Forge Trust custody business, which may in turn have an adverse effect on our consolidated financial condition and results of operations. We are subject to overview by multiple regulators. Forge Trust is subject to periodic regulatory examinations and inspections by the South Dakota Division of Banking. Additionally, SharesPost Securities LLC, a California licensed lender and one of our wholly owned subsidiaries, is subject to periodic regulatory examinations and inspections by the California Division of Financial Protection and Innovation. Monitoring and complying with all applicable laws, regulations and regulators can be difficult and costly. Failure to comply with any of these requirements may result in, among other things, enforcement action by governmental authorities, lawsuits, monetary damages, fines or monetary penalties, restitution or other payments to investors, modifications to business practices, revocation of required licenses or registrations, voiding of loan contracts and reputational harm, all of which could materially harm our results of operations. The regulatory requirements to which we are subject result in substantial compliance costs, and our business would be adversely affected if any applicable authorities determine we are not in compliance with those requirements. We must comply with state licensing requirements and varying compliance requirements in all the states in which we operate and the District of Columbia. In addition, we rely on certain exemptions from licensing requirements in other jurisdictions where we conduct business. Changes in licensing and registration laws may result in increased disclosure requirements, increased fees, or may impose other conditions to licensing or registrations that we or our personnel are unable to meet. In most states and jurisdictions in which we operate, a regulatory agency or agencies regulate and enforce laws relating to loan servicers, brokers, and originators, collection agencies, and money services businesses. We are subject to periodic examinations by state and other regulators in the jurisdictions in which we conduct business, which can result in increases in our administrative costs and refunds to borrowers of 22 Table of Contents certain fees earned by us, and we may be required to pay substantial and material penalties imposed by those regulators due to compliance errors, including any failures to properly register for applicable licenses or registrations, or we may lose our license or our ability to do business in the jurisdiction otherwise may be impaired. Fines and penalties incurred in one jurisdiction may cause investigations or other actions by regulators in other jurisdictions. We may not be able to acquire or maintain all requisite licenses, registrations and permits. If we change or expand our business activities, we may be required to obtain additional licenses before we can engage in those activities. When we apply for a new license, the applicable regulator may determine that we were required to do so at an earlier point in time, and as a result, may impose substantial and material penalties or refuse to issue the license, which could require us to modify or limit our activities in the relevant jurisdiction. In addition, the jurisdictions that currently do not provide extensive regulation of our business may later choose to do so, and if such jurisdictions so act, we may not be able to obtain or acquire or maintain all requisite licenses, registrations and permits, which could require us to modify or limit our activities in the relevant jurisdictions. The failure to satisfy those and other regulatory requirements could have a material adverse effect on our business, financial condition and results of operations. We have expanded and may continue to expand into international markets, which expose us to significant new risks, and our international expansion efforts may not be successful. We operate and serve investors in foreign jurisdictions, and our business is subject to the laws and requirements of each jurisdiction in which we operate. Issuers, buyers and sellers from over sixty jurisdictions use our platform. The majority of our revenues are derived from transactions involving U.S. issuers. Our operations are located in the United States. We have a local branch office in Hong Kong. Our subsidiary, SharesPost Asia Pte Ltd., holds a Recognized Market Operator license with the Monetary Authority of Singapore; however, it currently does not engage in any business activities. There is risk that local regulators may determine we are not in compliance with applicable local laws and regulations. In such cases, we may be subject to material fines and penalties, and may need to materially modify, limit, or cease operations in that jurisdiction. In addition, if we change or expand our business activities, we may be required to obtain additional licenses or registrations before we can engage in those activities in each jurisdiction, which could cause us to incur substantial compliance costs. If we apply for a new license or registration, a regulator may determine that we were required to do so at an earlier point in time, and as a result, may impose penalties or refuse to issue the license, which could require us to materially modify, limit, or cease our activities in the relevant jurisdiction. We may be required to pay substantial penalties imposed by those regulators due to compliance errors, or we may lose our license or our ability to do business in the jurisdiction otherwise may be impaired. Fines and penalties incurred in one jurisdiction may cause investigations or other actions by regulators in other jurisdictions. This could be detrimental to our business, resulting in lost revenue, fines, or other adverse consequences. In addition, the jurisdictions that currently do not provide extensive regulation of our business may later choose to do so, and if such jurisdictions so act, we could incur substantial compliance costs and may not be able to obtain or maintain all requisite licenses and permits, which could require us to modify, limit, or cease our activities in the relevant jurisdiction or jurisdictions. In addition to regulatory risks, there are significant risks and costs inherent in doing business in international markets, including: difficulty establishing and managing international operations and the increased operations, travel, infrastructure and legal and compliance costs associated with locations in different countries or regions; difficulties or delays in obtaining and/or maintaining the regulatory permissions, authorizations, licenses or consents that may be required to offer certain products in one or more international markets; difficulties in managing multiple regulatory relationships across different jurisdictions on complex legal and regulatory matters; difficulties in identifying and obtaining appropriate local foreign counsel in the jurisdictions in which we operate or plan to operate; if we were to engage in any merger or acquisition activity internationally, this is complex and would be new for us and subject to additional regulatory scrutiny; the need to vary products, pricing and margins to effectively compete in international markets; 23 Table of Contents the need to adapt and localize products for specific countries, including obtaining rights to third-party intellectual property used in each country; increased competition from local providers of similar products and services; the challenge of positioning our products and services to meet a demand in the local market; the ability to obtain, maintain, protect, defend and enforce intellectual property rights abroad; the need to offer customer support and other aspects of our offering (including websites, articles, blog posts and customer support documentation) in various languages; compliance with anti-bribery laws and the potential for increased complexity due to the requirements on us as a group to follow multiple rule sets; complexity and other risks associated with current and future legal requirements in other countries, including laws, rules, regulations and other legal requirements related to cybersecurity and data privacy frameworks and labor and employment laws; the need to enter into new business partnerships with third-party service providers in order to provide products and services in the local market, which we may rely upon to be able to provide such products and services or to meet certain regulatory obligations; varying levels of internet technology adoption and infrastructure, and increased or varying network and hosting service provider costs and differences in technology service delivery in different countries; fluctuations in currency exchange rates and the requirements of currency control regulations, which might restrict or prohibit conversion of other currencies into U.S. dollars; taxation of our international earnings and potentially adverse tax consequences due to requirements of or changes in the income and other tax laws of the United States or the international jurisdictions in which we operate; and political or social unrest or economic instability in a specific country or region in which we operate. We have limited experience with international regulatory environments and market practices, and we may not be able to penetrate or successfully operate in the markets we choose to enter. In addition, we may incur significant expenses as a result of our international expansion, and we may not be successful. We also may fail to sufficiently adapt our offerings in terms of language, culture, issuer operations, shareholder behaviors, investor preferences or otherwise, which would limit or prevent our success in entering new markets. We have in the past, and will continue to be, subject to inquiries, exams, investigations or enforcement matters, any of which could have an adverse effect on our business. The financial services industry is subject to extensive regulation under federal, state, and applicable international laws. From time to time, we have been threatened with or named as a defendant in lawsuits, arbitrations and/or administrative claims involving securities, consumer financial services and other matters. For example, in 2016, we became subject to a SEC Order (in the Matter of Equidate, Inc. and Equidate Holdings LLC, Release No. 10262) pursuant to Section 8A of the Securities Act and Section 21C of the Exchange Act (the Order ). The Order required us to cease and desist from committing or causing any violations or future violations of Section 5(e) of the Securities Act and Section 6(l) of the Exchange Act and required us to pay civil money penalties in the amount of $80,000. Following a request by the Company, the SEC determined that we had made a showing of good cause under Rule 506(d)(2)(ii) of Regulation D and Rule 262(b)(2) of Regulation A and the SEC granted a waiver regarding any bad-actor disqualification by reason of the entry of the Order. Following the Order, we have completely ceased the transactions described in the Order that were found to be security-based swaps and have implemented new transaction contracts and fund structures. 24 Table of Contents We are also subject to periodic regulatory examinations and inspections. Compliance and trading problems or other deficiencies or weaknesses that are reported to regulators, such as the SEC, FINRA, the CFPB, or state regulators, by dissatisfied customers or others, or that are identified by regulators themselves, are investigated by such regulators, and may, if pursued, result in formal claims being filed against us by customers or disciplinary action being taken against us or our employees by regulators or enforcement agencies. To resolve issues raised in examinations or other governmental actions, we may be required to take various corrective actions, including changing certain business practices, making refunds or taking other actions that could be financially or competitively detrimental to us. We expect to continue to incur costs to comply with governmental regulations. Any such claims or disciplinary actions that are decided against us could have a material impact on our financial results. Employee misconduct, including insider trading violations (given the nature of our business), can be difficult to detect and deter, and could harm our reputation and subject us to significant legal liability. We cannot ensure that all of our employees and agents will comply with our internal policies and procedures and applicable law, including anti-corruption, anti-bribery and similar laws. We may ultimately be held responsible for any such non-compliance. We operate in an industry in which integrity and the confidence of our customers is of critical importance. We are subject to risks of errors and misconduct by our employees that could adversely affect our business, including: engaging in misrepresentation or fraudulent activities when marketing or performing brokerage and other services to our customers; improperly using or disclosing confidential information of our customers or other parties; concealing unauthorized or unsuccessful activities; or otherwise not complying with applicable laws and regulations or our internal policies or procedures, including those related to insider trading. There have been numerous highly-publicized cases of fraud and other misconduct by financial services industry employees. The precautions that we take to detect and deter employee misconduct might not be effective. If any of our employees engage in illegal, improper, or suspicious activity or other misconduct, we could suffer serious harm to our reputation, financial condition, member relationships, and our ability to attract new customers. We also could become subject to regulatory sanctions and significant legal liability, which could cause serious harm to our financial condition, reputation, member relationships and prospects of attracting additional customers. We may become subject to examinations, regulatory enforcement or litigation as a result of our failure to comply with applicable laws and regulations, even if noncompliance was inadvertent. We maintain systems and procedures designed to ensure that we comply with applicable laws and regulations; however, some legal/regulatory frameworks provide for the imposition of fines or penalties for noncompliance even though the noncompliance was inadvertent or unintentional and even though there were systems and procedures designed to ensure compliance in place at the time. Litigation, regulatory actions, and compliance issues could subject us to significant fines, penalties, judgments, remediation costs, negative publicity, changes to our business model, and requirements resulting in increased expenses. Our business is subject to increased risks of litigation and regulatory actions as a result of a number of factors and from various sources, including as a result of the highly regulated nature of the financial services industry and the focus of state and federal enforcement agencies on the financial services industry. From time to time, we are also involved in, or the subject of, reviews, requests for information, investigations and proceedings (both formal and informal) by state and federal governmental agencies and self-regulatory organizations, regarding our business activities and our qualifications to conduct our business in certain jurisdictions, which could subject us to significant fines, penalties, obligations to change our business practices and other requirements resulting in increased expenses and diminished earnings. Our involvement in any such matter also could cause significant harm to our reputation and divert management attention from the operation of our business, even if the matters are ultimately determined in our favor. Moreover, any settlement, or any consent order or adverse judgment in connection with any formal or informal proceeding or investigation by a government agency, may prompt 25 Table of Contents litigation or additional investigations or proceedings as other litigants or other government agencies begin independent reviews of the same activities. The current regulatory environment, increased regulatory compliance efforts and enhanced regulatory enforcement have resulted in significant operational and compliance costs and may prevent us from providing certain products and services. There is no assurance that these regulatory matters or other factors will not, in the future, affect how we conduct our business and, in turn, have a material adverse effect on our business. In particular, legal proceedings brought under state consumer protection statutes or under several of the various federal consumer financial services statutes may result in a separate fine for each violation of the statute, which, particularly in the case of class action lawsuits, could result in damages substantially in excess of the amounts we earned from the underlying activities. Our enterprise risk management and regulatory compliance framework may not be fully effective in identifying or mitigating risk exposures in evolving market and regulatory environments or against all types of risk. As a financial services company operating in the securities industry, among others, our business model exposes us to various risks, including capital adequacy and liquidity risk, strategic risk, operational risk, information technology risk, cybersecurity risk, vendor/third party risk, financial risk, and reputational risk. Our enterprise risk management and compliance processes, policies, and procedures may not be fully effective in identifying or mitigating all exposures and particularly against emerging risks. We have devoted significant resources to develop our compliance and risk management policies and procedures and will continue to do so, but there can be no assurance these are sufficient or that we will not sustain unexpected losses, especially as our business is growing and evolving. Our limited operating history, evolving business, and growth make it difficult to predict all of the risks and challenges we may encounter and the level of resources needed to address them, particularly when compared with more mature financial services companies. It also makes it difficult to predict completely the landscape of risks we will face as we introduce new products and services and expand into new jurisdictions. Insurance and other traditional risk mitigating tools may be held by or available to us in order to manage certain exposures, but they are subject to terms such as deductibles, coinsurance, limits and policy exclusions, as well as risk of counterparty denial of coverage, default or insolvency. Any perceived or actual breach of laws and regulations could also negatively impact our business, financial condition, and results of operations. We are subject to stringent laws, rules, regulations, policies, industry standards and contractual obligations regarding data privacy and security and may be subject to additional related laws and regulations in jurisdictions into which we expand. Many of these laws and regulations are subject to change and reinterpretation and could result in claims, changes to our business practices, monetary penalties, increased cost of operations or other harm to our business. We are subject to a variety of federal, state, local, and non-U.S. laws, directives, rules, policies, industry standards and regulations, as well as contractual obligations, relating to privacy and the collection, protection, use, retention, security, disclosure, transfer and other processing of personal data and other data, including the Gramm-Leach-Bliley Act of 1999 ( GLBA ), Section 5(c) of the Federal Trade Commission Act and the CCPA. The regulatory framework for data privacy and security worldwide is continuously evolving and developing and, as a result, interpretation and implementation standards and enforcement practices are likely to remain uncertain for the foreseeable future. New laws, amendments to or reinterpretations of existing laws, regulations, standards and other obligations may require us to incur additional costs and restrict our business operations, and may require us to change how we use, collect, store, transfer or otherwise process certain types of personal data and to implement new processes to comply with those laws and our customers exercise of their rights thereunder. In the United States, federal law, such as the GLBA and its implementing regulations, restricts certain collection, processing, storage, use and disclosure of personal data, requires notice to individuals of privacy practices and provides individuals with certain rights to prevent the use and disclosure of certain nonpublic or otherwise legally protected information. These rules also impose requirements for the safeguarding and proper destruction of personal data through the issuance of data security standards or guidelines. The U.S. government, including Congress, the Federal Trade Commission and the Department of Commerce, has announced that it is reviewing the need for greater regulation for the collection, use and other processing of information concerning consumer behavior on the internet, including regulation aimed at restricting certain targeted advertising practices. There is also a risk of enforcement actions in response to rules and regulations promulgated under the authority of federal agencies and state attorneys general and legislatures and consumer protection agencies. In addition, privacy advocates and industry groups have proposed and may propose new and different self-regulatory standards that either legally or contractually apply to us. If we fail to follow these security 26 Table of Contents standards, even if no customer information is compromised, we may incur significant fines or experience a significant increase in costs. Numerous states have enacted or are in the process of enacting state-level data privacy laws and regulations governing the collection, use, and other processing of state residents personal data. For example, the CCPA, which took effect on January 1, 2020, established a new privacy framework for covered businesses such as ours, and may require us to modify our data processing practices and policies and incur compliance related costs and expenses. The CCPA provides new and enhanced data privacy rights to California residents, such as affording California residents the right to access and delete their information and to opt out of certain sharing and sales of personal information. The law also prohibits covered businesses from discriminating against California residents (for example, charging more for services) for exercising any of their CCPA rights. The CCPA imposes severe civil penalties and statutory damages as well as a private right of action for certain data breaches that result in the loss of personal information. This private right of action is expected to increase the likelihood of, and risks associated with, data breach litigation. However, it remains unclear how various provisions of the CCPA will be interpreted and enforced. In November 2020, California voters passed the California Privacy Rights Act of 2020 ( CPRA ). Effective in most material respects starting on January 1, 2023, the CPRA will impose additional obligations on companies covered by the legislation and will significantly modify the CCPA, including by expanding the CCPA with additional data privacy compliance requirements that may impact our business. The CPRA also establishes a regulatory agency dedicated to enforcing the CCPA and the CPRA. The effects of the CPRA, the CCPA, other similar state or federal laws and other future changes in laws or regulations relating to privacy, data protection and information security, particularly any new or modified laws or regulations that require enhanced protection of certain types of data or new obligations with regard to data retention, transfer or disclosure, are significant and may require us to modify our data processing practices and policies and could greatly increase the cost of providing our offerings, require significant changes to our operations or even prevent us from providing certain offerings in jurisdictions in which we currently operate and in which we may operate in the future or incur potential liability in an effort to comply with such legislation. The CPRA and the CCPA may lead other states to pass comparable legislation, with potentially greater penalties and more rigorous compliance requirements relevant to our business. For example, many state legislatures have adopted legislation that regulates how businesses operate online, including measures relating to privacy, data security, data breaches and the protection of sensitive and personal information. Laws in all 50 states require businesses to provide notice to customers whose personally identifiable information has been disclosed as a result of a data breach. The laws are not consistent, as certain state laws may be more stringent or broader in scope, or offer greater individual rights, with respect to sensitive and personal information than federal, international or other state laws, and such laws may differ from each other, which may complicate compliance efforts. Compliance in the event of a widespread data breach may be costly. The NYDFS also issued Cybersecurity Requirements for Financial Services Companies, which took effect in 2017, and which require banks, insurance companies and other financial services institutions regulated by the NYDFS, including Forge Securities, to establish and maintain a cybersecurity program designed to protect consumers and ensure the safety and soundness of New York State s financial services industry. The cybersecurity regulation adds specific requirements for these institutions cybersecurity compliance programs and imposes an obligation to conduct ongoing, comprehensive risk assessments. Further, on an annual basis, each institution is required to submit a certification of compliance with these requirements. We have in the past and may in the future be subject to investigations and examinations by the NYDFS regarding, among other things, our cybersecurity practices. Additionally, we are subject to the General Data Protection Regulation ( GDPR ), which imposes additional obligations and risk upon our business, including substantial expenses and changes to business operations that are required to comply with the GDPR. Further, following the withdrawal of the U.K. from the E.U., we are required to comply separately with the GDPR as implemented in the U.K., which may lead to additional compliance costs and could increase our overall risk. We make public statements about our use, collection, disclosure and other processing of personal data through our privacy policies, information provided on our website and press statements. Although we endeavor to comply with our public statements and documentation, we may at times fail to do so or be alleged to have failed to do so. The publication of our privacy policies and other statements that provide promises and assurances about data privacy and security can subject us to potential government or legal action if they are found to be deceptive, unfair or misrepresentative of our actual practices. Any failure or perceived failure by us or our third-party service providers to comply with our posted privacy policies or with any applicable federal, state or similar foreign laws, rules, regulations, industry standards, policies, certifications or orders relating to data privacy and security, or any compromise of security that results in the theft, unauthorized access, acquisition, use, disclosure, or misappropriation of personal data or other customer data, could result in significant awards, fines, civil and/or criminal penalties or judgments, proceedings or litigation by governmental agencies or customers, including class action privacy litigation in certain jurisdictions and negative publicity and 27 Table of Contents reputational harm, one or all of which could have an adverse effect on our reputation, business, financial condition and results of operations. We collect, store, share, disclose, transfer, use and otherwise process customer information and other data, including personal data, and an actual or perceived failure by us or our third-party service providers to protect such information and data or respect customers privacy could damage our reputation and brand, negatively affect our ability to retain customers and harm our business, financial condition, operating results, cash flows and prospects. The operation of our platform involves the use, collection, storage, sharing, disclosure, transfer and other processing of customer information, including personal data, and security breaches and other security incidents could expose us to a risk of loss or exposure of this information, which could result in potential liability, investigations, regulatory fines, penalties for violation of applicable laws or regulations, litigation, and remediation costs, as well as reputational harm. Any or all of the issues above could adversely affect our ability to attract new customers and continue our relationship with existing customers, cause our customers to stop using our products and services, result in negative publicity or subject us to governmental, regulatory or third-party lawsuits, disputes, investigations, orders, regulatory fines, penalties for violation of applicable laws or regulations or other actions or liability, thereby harming our business, financial condition, operating results, cash flows, and prospects. Any accidental or unauthorized access to or disclosure, loss, destruction, disablement or encryption of, use or misuse of or modification of data, including personal data, cybersecurity breach or other security incident that we, our customers or our third-party service providers experience or the perception that one has occurred or may occur, could harm our reputation, reduce the demand for our products and services and disrupt normal business operations. In addition, it may require us to expend significant financial and operational resources in response to a security breach, including repairing system damage, increasing security protection costs by deploying additional personnel and modifying or enhancing our protection technologies, investigating, remediating or correcting the breach and any security vulnerabilities, defending against and resolving legal and regulatory claims, and preventing future security breaches and incidents, all of which could expose us to uninsured liability, increase our risk of regulatory scrutiny, expose us to legal liabilities, including litigation, regulatory enforcement, indemnity obligations or damages for contract breach, divert resources and the attention of our management and key personnel away from our business operations, and cause us to incur significant costs, any of which could materially adversely affect our business, financial condition, and results of operations. We are subject to anti-money laundering and anti-terrorism financing laws and regulations, and failure to comply with these obligations could have significant adverse consequences for us, including subjecting us to criminal or civil liability and harm to our business. Various laws and regulations in the United States and abroad, such as the Bank Secrecy Act, the Dodd-Frank Act, the USA PATRIOT Act, and the Credit Card Accountability Responsibility and Disclosure Act, impose certain anti-money laundering requirements on companies that are financial institutions or that provide financial products and services. Under these laws and regulations, financial institutions are broadly defined to include money services businesses such as money transmitters. In 2013, FinCEN issued guidance regarding the applicability of the Bank Secrecy Act to administrators and exchangers of convertible virtual currency, clarifying that they are money service businesses, and more specifically, money transmitters. The Bank Secrecy Act requires money services businesses ( MSBs ) to develop and implement risk-based anti-money laundering programs, report large cash transactions and suspicious activity, and maintain transaction records, among other requirements. State regulators may impose similar requirements on licensed money transmitters. In addition, our contracts with financial institution partners and other third parties may contractually require us to maintain an anti-money laundering program. We are also subject to economic and trade sanctions programs administered by the Treasury Department s Office of Foreign Assets Control, or OFAC, which prohibit or restrict transactions to or from or dealings with specified countries, their governments, and in certain circumstances, their nationals, and with individuals and entities that are specially-designated nationals of those countries, narcotics traffickers, terrorists or terrorist organizations, and other sanctioned persons and entities. Our failure to comply with anti-money laundering, economic and trade sanctions regulations, and similar laws could subject us to substantial civil and criminal penalties, or result in the loss or restriction of our MSB or broker-dealer registrations and state licenses, or liability under our contracts with third parties, which may significantly affect our ability to conduct some aspects of our business. Changes in this regulatory environment, including changing interpretations and the implementation of new or varying regulatory requirements by the government. 28 Table of Contents We are subject to anti-corruption, anti-bribery and similar laws, and non-compliance with such laws can subject us to significant adverse consequences, including criminal or civil liability and harm our business. We are subject to the FCPA, U.S. domestic bribery laws and other U.S. and foreign anti-corruption laws. Anti-corruption and anti-bribery laws have been enforced aggressively in recent years and are interpreted broadly to generally prohibit companies, their employees and their third-party intermediaries from authorizing, offering or providing, directly or indirectly, improper payments or benefits to recipients in the public sector. These laws also require that we keep accurate books and records and maintain internal controls and compliance procedures designed to prevent any such actions. In addition, we or our third-party intermediaries may have direct or indirect interactions with officials and employees of government agencies or state-owned or affiliated entities. We can be held liable for the corrupt or other illegal activities of these third-party intermediaries, our employees, representatives, contractors, partners, and agents, even if we do not explicitly authorize such activities. The failure to comply with any such laws could subject us to criminal or civil liability, cause us significant reputational harm and have an adverse effect on our business, financial condition and results of operations. We may be unable to sufficiently obtain, maintain, protect, or enforce our intellectual property and other proprietary rights, any of which could reduce our competitiveness and harm our business and operating results. Our ability to service our customers depends, in part, upon our proprietary technology. We may be unable to protect our proprietary technology effectively, which would allow competitors to duplicate our business processes and know-how, and adversely affect our ability to compete with them. A third party may attempt to reverse engineer or otherwise obtain and use our proprietary technology without our consent. The pursuit of a claim against a third party for infringement of our intellectual property could be costly, and there can be no guarantee that any such efforts would be successful. In addition, our market and platform may infringe upon claims of third-party intellectual property, and we may face intellectual property challenges from such other parties. We may not be successful in defending against any such challenges or in obtaining licenses to avoid or resolve any intellectual property disputes. The costs of defending any such claims or litigation could be significant and, if we are unsuccessful, could subject us to substantial liability, prevent us from using the relevant technology or providing related products or services, or result in a requirement that we pay significant damages or licensing fees. Furthermore, our technology may become obsolete, and there is no guarantee that we will be able to successfully develop, obtain or use new technologies to adapt our platform to stay competitive in the future. If we cannot protect our proprietary technology from intellectual property challenges, or if our platforms become obsolete, our business, financial condition, and results of operations could be adversely affected. Accusations of infringement of third-party intellectual property rights could materially and adversely affect our business. Our success depends upon our ability to refrain from infringing upon the intellectual property rights of others. Some companies, including some of our competitors, may own large numbers of patents, copyrights and trademarks, which they may use to assert claims against us. As we grow and enter new markets, we will face a growing number of competitors. As the number of competitors in our industry grows and the functionality of products in different industry segments overlaps, we expect that software and other solutions in our industry may be subject to such claims by third parties. Third parties may in the future assert claims of infringement, misappropriation or other violations of intellectual property rights against us. We cannot assure you that infringement claims will not be asserted against us in the future, or that, if asserted, any infringement claim will be successfully defended. A successful claim against us could require that we pay substantial damages, prevent us from offering our services, or require that we comply with other unfavorable terms. Even if we were to prevail in such a dispute, any litigation regarding our intellectual property could be costly and time-consuming and divert the attention of our management and key personnel from our business operations. Changes in tax law, differences in interpretation of tax laws and regulations, and proposed legislation that would impose taxes on certain financial transactions could have a material adverse effect on our business, financial condition and results of operations. We operate in multiple jurisdictions and are subject to tax laws and regulations of the U.S. federal, state and local and non-U.S. governments. U.S. federal, state and local and non-U.S. tax laws and regulations are complex and subject to change (possibly with retroactive effect) and to varying interpretations. U.S. federal, state and local and non-U.S. tax authorities may interpret tax laws and regulations differently than we do and challenge tax positions that we have taken. This may result in differences in the treatment of revenues, deductions, credits and/or differences in the timing of these items. The differences in treatment may result in payment of additional taxes, interest or penalties that could have an adverse effect on our financial condition and results of operations. Further, future changes to U.S. federal, state and local and non-U.S. tax laws and regulations could increase our tax obligations in jurisdictions where we do business or require us to change the manner in which we conduct some aspects of our business. 29 Table of Contents Personnel and Business Continuity Risks We rely on our management team and will require additional key personnel to grow our business, and the loss of key management members or key employees, or an inability to hire key personnel, could harm our business. We believe our success has depended, and continues to depend, on the efforts and talents of our senior management, including our Chief Executive Officer Kelly Rodriques, who have significant experience in industries we operate, are responsible for our core competencies and would be difficult to replace. Our future success depends on our continuing ability to attract, develop, motivate and retain highly qualified and skilled employees. Qualified individuals are in high demand, and we may incur significant costs to attract and retain them. In addition, the loss of any of our senior management or key employees could materially adversely affect our ability to execute our business plan and strategy, and we may not be able to find adequate replacements on a timely basis, or at all. Our executive officers and other employees are at-will employees, which means they may terminate their employment relationship with us at any time, and their knowledge of our business and industry would be extremely difficult to replace. We cannot ensure that we will be able to retain the services of any members of our senior management or other key employees. If we do not succeed in attracting well-qualified employees or retaining and motivating existing employees, our business could be materially and adversely affected. We may not be able to secure adequate insurance to cover all known risks and our insurance policies may not be sufficient to cover all potential claims. Our systems and operations, as well as those of the third parties on whom we rely to conduct certain key functions, are vulnerable to disruptions from natural disasters, power outages, computer and telecommunications failures, software bugs, cyber-attacks, computer viruses, malware, distributed denial of service attacks, spam attacks, phishing or other social engineering, ransomware, security breaches, credential stuffing, technological failure, human error, terrorism and other similar events. If our technology is disrupted, we may have to make significant investments to upgrade, repair or replace our technology infrastructure and may not be able to make such investments on a timely basis, if at all. While we have made significant investments designed to enhance the reliability and scalability of our operations, we cannot assure that we will be able to maintain, expand and upgrade our systems and infrastructure to meet future requirements and mitigate future risks on a timely basis. Disruptions in service and slower system response times could interrupt our business and result in substantial losses, decreased customer service and satisfaction, customer attrition, fines, litigation, and harm to our reputation. Our insurance coverage may be insufficient to protect us against all losses and costs stemming from operational and technological failures and we cannot be certain that such insurance will continue to be available to us on economically reasonable terms, or at all, or that any insurer will not deny coverage as to any future claim. The successful assertion of one or more large claims against us that exceed available insurance coverage, or the occurrence of changes in our insurance policies, including premium increases or the imposition of large deductible or co-insurance requirements, could have a material and adverse effect on our business, financial condition and results of operations. Information Technology and Data Risks We depend on third parties for a wide array of services, systems and information technology applications, and a breach or violation of law by one of these third parties could disrupt our business or provide our competitors with an opportunity to enhance their position at our expense. Additionally, the loss of any of those service providers could materially and adversely affect our business, results of operations, and financial condition. We rely on third-party service providers to perform various functions relating to operational functions, cloud infrastructure services and information technology. We do not have control over the operations of any of the third-party service providers that we utilize. In the event that a third-party service provider for any reason fails to perform functions properly, including through negligence, willful misconduct or fraud, our ability to process billings and perform other operational functions for which we currently rely on such third-party service providers will suffer and our business, cash flows and future prospects may be negatively impacted. Additionally, if one or more key third-party service providers were to cease to exist, or to terminate its relationship with us, there could be delays in our ability to process transactions and perform other operational functions for which we are currently relying on such third-party service providers for, and we may not be able to promptly replace such third-party service provider with a different third-party service provider that has the ability to promptly provide the same services in the same manner and on the same economic terms. 30 Table of Contents In many cases, we are reliant on a single third party to provide such services, and we may not be able to replace that provider on the same terms or at all. As a result of any such delay or inability to replace such key third-party service provider, our ability to process investments and perform other business functions could suffer and our business, financial condition and results of operations could be materially and adversely affected. Because we rely on third parties to provide services, we could also be adversely impacted if they fail to fulfill their obligations or if our arrangements with them are terminated and suitable replacements cannot be found on commercially reasonable terms or at all. Systems failures or disruptions, including events beyond our control, and resulting interruptions in the availability of our websites or services could harm our business and reputation. Certain of our systems rely on older programming languages and are dependent upon hardware that may soon be in need of replacement. A breakdown or shutdown of our operating systems could cause a major disruption to the business, and our attempts to modernize our systems or implement new hardware or software may not be successful, and may otherwise be costly and time-consuming. Our products and internal systems rely on software that is highly technical, and if these systems contain errors, bugs or vulnerabilities, or if we are unsuccessful in addressing or mitigating technical limitations or vulnerabilities in our systems, our business could be adversely affected. Our products and internal systems rely on software, including software developed or maintained internally and by third parties, that is highly technical and complex. In addition, our platform and our internal systems depend on the ability of such software to collect, store, retrieve, transmit, manage and otherwise process immense amounts of data. The software on which we rely may contain errors, bugs or vulnerabilities, and our systems are subject to certain technical limitations that may compromise our ability to meet our objectives. Some errors, bugs or vulnerabilities inherently may be difficult to detect and may only be discovered after code has been released for external or internal-use. Errors, bugs, vulnerabilities, design defects or technical limitations within the software on which we rely may lead to negative customer experiences (including the communication of inaccurate information to customers), compromised ability of our products to perform in a manner consistent with customer expectations, delayed product introductions, compromised ability to protect the data (including personal data) of our customers and our intellectual property or an inability to provide some or all of our services. Such errors, bugs, vulnerabilities or defects could also be exploited by malicious actors and result in exposure of data of customers on our platform, or otherwise result in a security breach or other security incident. We may need to expend significant financial and development resources to analyze, correct, eliminate, or work around errors or defects or to address and eliminate vulnerabilities. Any failure to timely and effectively resolve any such errors, bugs, vulnerabilities or defects in the software on which we rely, and any associated degradations or interruptions of service, could result in damage to our reputation, loss of customers, loss of revenue, regulatory or governmental inquiries, civil litigation, or liability for damages, any of which could have an adverse effect on our business, financial condition and results of operations. Cyber incidents or attacks directed at us and to our systems could result in unauthorized access, information theft, data corruption, operational disruption and/or financial and reputational loss, and we may not be able to insure against such risk. We depend on digital technologies, including information systems, infrastructure and cloud applications and services, including those of third parties with which we may deal. Sophisticated and deliberate attacks on, or security breaches in, our systems or infrastructure, or the systems or infrastructure of third parties or the cloud, could lead to corruption or misappropriation of our assets, proprietary information and sensitive or confidential data. Our platforms may make an attractive target for hacking and may be vulnerable to computer viruses, physical or electronic break-ins and similar disruptions. It is possible that we may not be able to anticipate or to implement effective preventive measures against all security threats of these types, in which case there would be an increased risk of fraud or identity theft. Security incidents could occur from outside our company, and also from the actions of persons inside our company who may have authorized or unauthorized access to our technology systems. We may not have sufficient resources to adequately protect against, or to investigate and remediate any vulnerability to, cyber incidents. It is possible that any of these occurrences, or a combination of them, could have adverse consequences on our business and lead to financial loss. Financial services providers like us, as well as our customers, colleagues, regulators, vendors and other third parties, have experienced a significant increase in fraudulent activity in recent years and will likely continue to be the target of increasingly sophisticated criminal activity in the future. 31 Table of Contents We develop and maintain systems and processes aimed at detecting and preventing fraudulent activity, which require significant investment, maintenance and ongoing monitoring and updating as technologies and regulatory requirements change and as efforts to overcome security and anti-fraud measures become more sophisticated. Despite our efforts, the possibility of fraudulent or other malicious activities and human error or malfeasance cannot be eliminated entirely and will evolve as new and emerging technology is deployed, including the increasing use of personal mobile and computing devices that are outside of our network and control environments. Risks associated with each of these include theft of funds and other monetary loss, the effects of which could be compounded if not detected quickly. Indeed, fraudulent activity may not be detected until well after it occurs and the severity and potential impact may not be fully known for a substantial period of time after it has been discovered. Additionally, if hackers were able to access our secure data, they might be able to gain access to the personal information of our customers. If we are unable to prevent such activity, we may be subject to significant liability, negative publicity and a material loss of customers, all of which may materially and adversely affect our business, financial condition and results of operations. Fraudulent activity and other actual or perceived failures to maintain a product s integrity and/or security has led to increased regulatory scrutiny and negative assessments of us. Fraudulent activity and other related incidents related to the actual or perceived failures to maintain the integrity of our processes and controls could negatively affect us, including harming the market perception of the effectiveness of our security measures or harming the reputation of the financial system in general, which could result in reduced use of our products and services. Such events could also result in legislation and additional regulatory requirements. Although we maintain insurance, there can be no assurance that liabilities or losses we may incur will be covered under such policies or that the amount of insurance will be adequate. Any of the foregoing could materially and adversely affect our business, financial condition, and results of operations. Risks Related to our Common Stock and to Being a Public Company Certain existing shareholders purchased securities in the Company at a price below the current trading price of such securities, and may experience a positive rate of return based on the current trading price. Future investors in our Company may not experience a similar rate of return. Certain shareholders in the Company, including the Selling Securityholders, acquired shares of common stock or warrants in the Company at prices below the current trading price of our common stock and may experience a positive rate of return based on the current trading price. See the section titled Information Related to Offered Securities. On May 17, 2022, the last reported sale price of our shares of common stock as reported on the NYSE was $21.88 per share. Holders of our warrants will be less likely to exercise their warrants, assumed warrants and Former Employee Options if the exercise prices of their warrants, assumed warrants and Former Employee Options exceed the market price of our shares of common stock. There is no guarantee that our warrants will continue to be in the money prior to their expiration, and as such, the warrants, assumed warrants and Former Employee Options may expire worthless. As such, any cash proceeds that we may receive in relation to the exercise of the warrants, assumed warrants or Former Employee Options overlying shares being offered for sale in this prospectus will be dependent on the trading price of our common stock. Given the relatively lower purchase prices that some of our shareholders paid to acquire securities and exercise prices that some of our shareholders may pay to exercise warrants or options to acquire shares of common stock compared to the current trading price of our shares of common stock, these shareholders, some of whom are our Selling Securityholders, in some instances will earn a positive rate of return on their investment, which may be a significant positive rate of return, depending on the market price of our shares of common stock at the time that such shareholders choose to sell their shares of common stock. The Selling Securityholders acquired the securities offered for resale in exchange for services, or at effective purchase prices ranging from $0.0024 to $11.50 per share as set forth in further detail in the section titled Information Related to Offered Securities. Investors who purchase our common stock on the NYSE following the Business Combination may not experience a similar rate of return on the securities they purchase due to differences in the purchase prices and the current trading price. Based on the last reported sale price of our shares of common stock referenced above and their respective purchase prices, the Selling Securityholders may receive potential profits ranging from up to $10.38 per share to up to $21.88 per share, as set forth in further detail in the section titled Information Related to Offered Securities. 32 Table of Contents Substantial future sales of shares of our shares of common stock could cause the market price of our shares of common stock to decline. We have agreed, at our expense to prepare and file this registration statement with the SEC. The shares of common stock being offered for resale in this prospectus represent approximately 58% of our total outstanding shares of common stock as of the date of this prospectus. Additionally, if all the warrants, assumed warrants and Former Employee Options are exercised, the holders of such warrants, assumed warrants and Former Employee Options would own an additional 28,858,897 shares of common stock, representing approximately 64% of our total shares of common stock outstanding following such exercise. After it is effective and until such time that it is no longer effective, the registration statement will permit the resale of these shares. The resale, or expected or potential resale, of a substantial number of our shares of common stock in the public market could adversely affect the market price for our shares of common stock and make it more difficult for you to sell your shares of common stock at times and prices that you feel are appropriate. Furthermore, we expect that, because there will be a large number of shares registered pursuant to this registration statement, Selling Securityholders will continue to offer the securities covered by this registration statement for a significant period of time, the precise duration of which cannot be predicted. Accordingly, the adverse market and price pressures resulting from an offering pursuant to a registration statement may continue for an extended period of time. In addition, because the current market price of our common stock is higher than the price certain Selling Securityholders paid for their securities and is higher than the exercise price of the warrants, assumed warrants and the Former Employee Options, there is more likelihood that Selling Securityholders holding shares of common stock or in-the-money derivative securities will sell their shares as soon as this registration statement is declared effective and any applicable lock-up restrictions expire. Based on the last reported sale price of our shares of common stock referenced above and their respective purchase prices, the Selling Securityholders may receive potential profits ranging from up to $10.38 per share to up to $21.88 per share, as set forth in further detail in the section titled Information Related to Offered Securities. The requirements of being a public company may strain our resources and distract our management, which could make it difficult to manage our business, particularly after we are no longer an emerging growth company. As a public company, we will incur legal, accounting and other expenses that we did not previously incur. We are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the listing requirements of the NYSE and other applicable securities rules and regulations. Compliance with these rules and regulations will increase our legal and financial compliance costs, make some activities more difficult, time-consuming or costly and increase demand on our systems and resources, particularly after we are no longer an emerging growth company. The Exchange Act requires that we file annual, quarterly and current reports with respect to our business, financial condition and results of operations. The Sarbanes-Oxley Act requires, among other things, that we establish and maintain effective internal controls and procedures for financial reporting. Furthermore, the need to establish the corporate infrastructure demanded of a public company may divert our management s attention from implementing our growth strategy, which could prevent us from improving our business, financial condition and results of operations. We have made, and will continue to make, changes to our internal controls and procedures for financial reporting and accounting systems to meet our reporting obligations as a public company. However, the measures we take may not be sufficient to satisfy our obligations as a public company. In addition, these rules and regulations will increase our legal and financial compliance costs and will make some activities more time consuming and costly. For example, we expect these rules and regulations to make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may be required to incur substantial costs to maintain the same or similar coverage. These additional obligations could have a material adverse effect on our business, financial condition and results of operations. In addition, changing laws, regulations and standards relating to corporate governance and public disclosure are creating uncertainty for public companies, increasing legal and financial compliance costs and making some activities more time consuming. These laws, regulations and standards are subject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies. This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. We intend to invest resources to comply with evolving laws, regulations and standards, and this investment may result in increased general and administrative expenses and a diversion of our management s time and attention from revenue-generating activities to compliance activities. If our efforts to comply with new laws, regulations and standards differ from the activities intended by regulatory or governing bodies due to ambiguities related to their application and practice, regulatory authorities may initiate legal proceedings against us and there could be a material adverse effect on our business, financial condition and results of operations. 33 Table of Contents Our management team has limited experience managing a public company. Our management has limited prior experience in managing a publicly traded company. As such, our management team may encounter difficulties in managing a public company and in complying with our reporting and other obligations under federal securities laws and other regulations and in connection with operating as a public company. Their lack of prior experience in dealing with the reporting and other obligations and laws pertaining to public companies could result in our management of Forge being required to devote significant time to these activities which may result in less time being devoted to the management and growth of Forge. In addition, we will be required to hire additional personnel with the appropriate level of knowledge, experience, and training in the accounting policies, practices or internal controls over financial reporting required of public companies. We may be required to incur significant expense in connection with these efforts. The JOBS Act permits emerging growth companies like us to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies. We qualify as an emerging growth company as defined in Section 2(a)(19) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies for as long as we continue to be an emerging growth company, including (i) the exemption from the auditor attestation requirements with respect to internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act of 2002, (ii) the exemptions from say-on-pay, say-on-frequency and say-on-golden parachute voting requirements and (iii) reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements. As a result, our shareholders may not have access to certain information they deem important. We will remain an emerging growth company until the earliest of (i) the last day of the fiscal year (a) following the fifth anniversary of our IPO, (b) in which we have total annual gross revenue of at least $1.07 billion or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock and public warrants held by non-affiliates exceeds $700 million as of the last business day of our prior second fiscal quarter, and (ii) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. We cannot predict if investors will find our shares less attractive if we choose to rely on these exemptions for the time period allowable. If some investors find our shares less attractive as a result of any choices to reduce disclosure, there may be a less active trading market for our shares and the price of our shares may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the exemption from complying with new or revised accounting standards provided in Section 7(a)(2)(B) of the Securities Act as long as we are an emerging growth company. An emerging growth company can therefore delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies, but any such election to opt out is irrevocable. We have elected to avail ourselves of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our financial statements with another public company that is neither an emerging growth company nor an emerging growth company that has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. We cannot predict if investors will find our common stock or public warrants less attractive because we will rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock or public warrants and more stock price volatility. Delaware law, our Certificate of Incorporation, and our Bylaws contain certain provisions, including anti-takeover provisions that limit the ability of stockholders to take certain actions and could delay or discourage takeover attempts that stockholders may consider favorable. Delaware Law, our Certificate of Incorporation, and our Bylaws, contain provisions that could have the effect of rendering more difficult, delaying, or preventing an acquisition that stockholders may consider favorable, including transactions in which stockholders might otherwise receive a premium for their shares. These provisions could also limit the price that investors might be willing to pay in the future for shares, and therefore depress the trading price of our common stock. These provisions could also make it difficult for stockholders to take certain actions, including electing directors who are not nominated by the current members of our Board or taking other corporate actions, including effecting changes in our management. Among other things, our Certificate of Incorporation and our Bylaws (collectively, the Governing Documents ) include provisions regarding: 34 Table of Contents providing for a classified board of directors with staggered, three-year terms; the ability of our Board to issue shares of preferred stock, including blank check preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquirer; the prohibition of cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates; the limitation of the liability of, and the indemnification of, our directors and officers; the ability of our Board to amend our Bylaws, which may allow our Board to take additional actions to prevent an unsolicited takeover and inhibit the ability of an acquirer to amend our Bylaws to facilitate an unsolicited takeover attempt; and advance notice procedures with which stockholders must comply to nominate candidates to our Board or to propose matters to be acted upon at a stockholders meeting, which could preclude stockholders from bringing matters before annual or special meetings of stockholders and delay changes in our Board and also may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer s own slate of directors or otherwise attempting to obtain control of us. These provisions, alone or together, could delay or prevent hostile takeovers and changes in control or changes in our Board or management. The provisions of our Bylaws requiring exclusive forum in the Court of Chancery of the State of Delaware for certain types of lawsuits may have the effect of discouraging lawsuits against our directors and officers. Our Bylaws provide that, to the fullest extent permitted by law, unless Forge consents in writing to an alternative forum, (a) the Delaware Court of Chancery (or, if such court does not have, or declines to accept, jurisdiction, another state court or a federal court located in Delaware) will be the exclusive forum for any complaint asserting any internal corporate claims, including claims in the right of Forge based upon a violation of a duty by a current or former director, officer, employee or stockholder in such capacity, or as to which the Delaware General Corporation Law confers jurisdiction upon the Court of Chancery and (b) the federal district courts of the United States of America will be the exclusive forum for any complaint asserting a cause of action arising under the Securities Act. The choice of forum provision may limit the ability of our shareholders to bring a claim in a forum that they find favorable for disputes with us or our directors, officers or other employees, and may discourage such lawsuits. There is uncertainty as to whether a court would enforce this provision. If a court ruled the choice of forum provision was inapplicable or unenforceable in an action, we may incur additional costs to resolve such action in other jurisdictions. The choice of forum provision is intended to apply to the fullest extent permitted by law to the above- specified types of actions and proceedings, including any derivative actions asserting claims under state law or the federal securities laws, and is intended to require, in each case, to the fullest extent permitted by law, that (i) any Securities Act claims be brought in the federal district courts of the United States in accordance with clause (b) of the choice of forum provision and (ii) suits brought to enforce any duty or liability created by the Exchange Act be brought in the United States District Court for the District of Delaware. The provision does not apply to any direct claims brought by our shareholders on their own behalf, or on behalf of any class of similarly situated shareholders, under the Exchange Act. Our shareholders will not be deemed, by operation of the choice of forum provision, to have waived our obligation to comply with all applicable federal securities laws and the rules and regulations thereunder. An active, liquid trading market for our common stock may not be sustained, which may make it difficult to sell the shares of our common stock you purchase. An active trading market for our common stock may not be sustained which would make it difficult for you to sell your shares of our common stock at an attractive price (or at all). A public trading market having the desirable characteristics of depth, liquidity, and orderliness depends upon the existence of willing buyers and sellers at any given time, and its existence is dependent upon the individual decisions of buyers and sellers over which neither we nor any market maker has control. The failure of an active and liquid trading market to develop and continue would likely have a material adverse effect on the value of our common stock. The market price of our common stock may decline below your purchase price, and you may not be able to sell your shares of our common stock at or above the price you paid for such shares (or at all). 35 Table of Contents Our operating results and stock price may be volatile. Stock markets, including the NYSE, the NYSE Amex and the Nasdaq Stock Market, have from time to time experienced significant price and volume fluctuations. Even if an active, liquid and orderly trading market develops and is sustained for our common stock and warrants, the market price of our common stock and warrants may be volatile and could decline significantly. In addition, the trading volume in our common stock and warrants may fluctuate and cause significant price variations to occur. If the market price of our common stock and warrants declines significantly, you may be unable to resell your shares and warrants. We cannot assure you that the market price of our common stock and warrants will not fluctuate widely or decline significantly in the future in response to a number of factors, including, among others, the following: the realization of any of the risk factors presented in this prospectus; actual or anticipated differences in our estimates, or in the estimates of analysts, for our revenues, results of operations, level of indebtedness, liquidity or financial condition; additions and departures of key personnel; failure to comply with the requirements of the NYSE; failure to comply with the Sarbanes-Oxley Act or other laws or regulations; future issuances, sales or resales, or anticipated issuances, sales or resales, of common stock; perceptions of the investment opportunity associated with common stock relative to other investment alternatives; the performance and market valuations of other similar companies; future announcements concerning our business or our competitors businesses; broad disruptions in the financial markets, including sudden disruptions in the credit markets; speculation in the press or investment community; actual, potential or perceived control, accounting or reporting problems; changes in accounting principles, policies and guidelines; and general economic and political conditions, such as the effects of the COVID-19 outbreak, recessions, interest rates, local and national elections, fuel prices, international currency fluctuations, corruption, political instability and acts of war or terrorism. In addition, as a result of substantial redemptions by the holders of Motive s Class A ordinary shares in connection with the Business Combination, since the Closing of the Business Combination there have been a limited number of shares of our common stock available for trading, and the price of our common stock has experienced substantial volatility in trading price. For example, the closing price of Motive s Class A ordinary shares on March 21, 2022, the date of the Closing, was $10.11 per share. Subsequent to March 22, 2022, the first date of trading of our common stock following the Closing, our common stock has traded at prices as low as $11.06 and as high as $47.50. The closing price of our common stock on May 17, 2022 on the NYSE was $22.18. Accordingly, there is the potential for rapid and substantial decreases in the price of our common stock, including decreases unrelated to our operating performance or prospects. In addition, the availability of, or sale of, substantial number of shares of our common stock offered under this prospectus may also cause the market price of our common stock to decline. In the past, securities class-action litigation has often been instituted against companies following periods of volatility in the market price of their securities. This type of litigation could result in substantial costs and divert our management s attention and resources, which could have a material adverse effect on us. 36 Table of Contents If the our operating and financial performance in any given period does not meet the guidance provided to the public or the expectations of investment analysts, the market price of the our common stock may decline. We have in the past, and we may, but are not obligated to, provide public guidance on our expected operating and financial results for future periods. Any such guidance consists of forward-looking statements, subject to the risks and uncertainties described in this prospectus and in our other public filings and public statements. The ability to provide this public guidance, and the ability to accurately forecast our results of operations, are inherently uncertain and subject to numerous risks and uncertainties, including those described in this prospectus, many of which may be beyond our control. Our actual results may not always be in line with or exceed any guidance we have provided, especially in times of economic uncertainty, such as the current global economic uncertainty being experienced as a result of the COVID-19 pandemic or the ongoing geopolitical tensions related to Russia s actions in Ukraine. If, in the future, our operating or financial results for a particular period do not meet any guidance provided or the expectations of investment analysts, or if we reduce our guidance for future periods, the market price of our common stock may decline as well. Even if we do issue public guidance, there can be no assurance that we will continue to do so in the future. If securities or industry analysts do not publish research, publish inaccurate or unfavorable research or cease publishing research about Forge, our share price and trading volume could decline significantly. The market for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. Securities and industry analysts may not publish research on us. If no or few securities or industry analysts commence coverage of us, the market price and liquidity for our common stock could be negatively impacted. In the event securities or industry analysts initiate coverage, if one or more of the analysts who cover us downgrade their opinions about common stock, publish inaccurate or unfavorable research about us, or cease publishing about us regularly, demand for our common stock could decrease, which might cause our share price and trading volume to decline significantly. Future sales, or the perception of future sales, by us or our stockholders in the public market could cause the market price for our common stock to decline. The sale of shares of our common stock in the public market, or the perception that such sales could occur, could harm the prevailing market price of shares of our common stock. These sales, or the possibility that these sales may occur, also might make it more difficult for us to sell equity securities in the future at a time and at a price that it deems appropriate. Future resales of common stock may cause the market price of our securities to drop significantly, even if our business is doing well. Although the Sponsor has agreed to certain transfer restrictions with respect to its founder shares the ( Lockup shares ) and its private placement warrants (the Lockup warrants, and together with the Lockup shares, the Sponsor Lockup Securities ), and our Bylaws provide for additional restrictions on the sale or transfer of the shares of common stock (including shares issuable upon exercise of assumed warrants and assumed options of Forge) Legacy Forge equityholders received in the Merger for a 180-day period following the Closing, following the expiration or earlier waiver or release of the applicable lock-ups described in this prospectus and as restrictions on resale end and registration statements are available for use, the market price of our common stock could decline if the holders of restricted or locked up shares sell them or are perceived by the market as intending to sell them. The Sponsor also has agreed to certain transfer restrictions with respect to the Sponsor Lockup Securities as follows: (a) one-third of the Lockup shares will be subject to a one year lock-up, and will be released from such lock-up if the closing price of our common stock equals or exceeds $12.00 for any 20 trading days in a 30-consecutive trading day period commencing 150 days post-Closing, (b) one-third of the Lockup warrants will be subject to a six month lock-up, (c) one-third of the Sponsor Lockup Securities will be subject to a three year lock-up, and will be released from such lock-up no earlier than six months after the Closing if the closing price our common stock equals or exceeds $12.50 for any 20 trading days in a 30-consecutive trading day period post-Closing, and (d) one-third of the Sponsor Lockup Securities will be subject to a three year lock-up, and will be released from such lock-up no earlier than six months after the Closing if the closing price our common stock equals or exceeds $15.00 for any 20 trading days in a 30-consecutive trading day period post-Closing. We may also waive, modify or otherwise release all or a portion of the Sponsor Lockup Securities and/or the Bylaws restrictions related to the Legacy Forge equityholder shares in its sole discretion. As such, sales of a substantial number of shares of our common stock in the public market could occur at any time. These sales, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of our common stock. 37 Table of Contents Future issuances of debt securities and equity securities may adversely affect us, including the market price of common stock and may be dilutive to existing shareholders. While we have not previously incurred indebtedness to finance our business in the past and do not currently intend to do it in the future, there is no assurance that we will not incur debt or issue equity ranking senior to common stock. Those securities will generally have priority upon liquidation. Such securities also may be governed by an indenture or other instrument containing covenants restricting its operating flexibility. Additionally, any convertible or exchangeable securities that we issue in the future may have rights, preferences and privileges more favorable than those of our common stock. Because our decision to issue debt or equity in the future will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing, nature or success of our future capital raising efforts. As a result, future capital raising efforts may reduce the market price of our common stock and be dilutive to existing shareholders. We do not intend to pay cash dividends for the foreseeable future. We currently intend to retain our future earnings, if any, to finance the further development and expansion of our business and do not intend to pay cash dividends in the foreseeable future. Any future determination to pay dividends will be at the discretion of our Board and will depend on our financial condition, results of operations, capital requirements, restrictions contained in future agreements and financing instruments, business prospects and such other factors as our Board deems relevant. We may be subject to securities litigation, which is expensive and could divert management attention. The market price of our common stock may be volatile and, in the past, companies that have experienced volatility in the market price of their stock have been subject to securities class action litigation. We may be the target of this type of litigation in the future. Securities litigation against us could result in substantial costs and divert management s attention from other business concerns, which could seriously harm our business. Risks Related to the Warrants The warrants may never be in the money, and they may expire worthless and we may amend the terms of the public warrants in a manner that may be adverse to holders with the approval by the holders of at least a majority of the then-outstanding public warrants. The exercise price for our warrants is $11.50 per share of common stock. There is no guarantee that the warrants will be in the money following the time they become exercisable and prior to their expiration, and as such, the warrants may expire worthless. The warrants were issued in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and Motive. The warrant agreement provides that the terms of the warrants may be amended without the consent of any holder to cure any ambiguity or correct any defective provision or correct any mistake, but requires the approval by the holders of at least 50% of the then-outstanding public warrants to make any change that adversely affects the interests of the registered holders of public warrants. Accordingly, we may amend the terms of the public warrants in a manner adverse to a holder if holders of at least 50% of the then-outstanding public warrants approve of such amendment and, solely with respect to any amendment to the terms of the private placement warrants or any provision of the warrant agreement with respect to the private placement warrants, 50% of the number of the then outstanding private placement warrants. Although our ability to amend the terms of the public warrants with the consent of at least 50% of the then-outstanding public warrants is unlimited, examples of such amendments could be amendments to, among other things, increase the exercise price of the warrants, convert the warrants into cash, shorten the exercise period or decrease the number of shares of common stock purchasable upon exercise of a warrant. We may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless. We have the ability to redeem outstanding warrants at any time after they become exercisable and prior to their expiration, at a price of $0.01 per warrant, provided that the last reported sales price of the common stock equals or exceeds $18.00 per share (as adjusted for share subdivisions, share dividends, rights issuances, subdivisions, reorganizations, recapitalizations and the like) for any 20 trading days within a 30 trading-day period ending on the third trading day prior to the date we send the notice of redemption to the warrant holders. If and when the warrants become redeemable by us, we may exercise our redemption right even if the terms of such redemption are not favorable to warrant holders. Redemption of the outstanding warrants could force you to: (i) exercise your warrants 38 Table of Contents and pay the exercise price therefore at a time when it may be disadvantageous for you to do so; (ii) sell your warrants at the then-current market price when you might otherwise wish to hold your warrants; or (iii) accept the nominal redemption price which, at the time the outstanding warrants are called for redemption, is likely to be substantially less than the market value of your warrants. In addition, we may redeem your warrants at any time after they become exercisable and prior to their expiration when the price per share equals or exceed $10.00 for any 20 trading days within a 30 trading-day period ending on the third trading day prior to the date we send the notice of redemption to the warrant holders at a price of $0.10 per warrant upon a minimum of 30 days prior written notice of redemption, provided that holders will be able to exercise their warrants prior to redemption on a cashless basis for a number of shares of common stock determined based on the redemption date and the fair market value of our common stock as provided in the warrant agreement. The value received upon exercise of the warrants on a cashless basis (1) may be less than the value the holders would have received if they had exercised their warrants at a later time where the underlying share price is higher and (2) may not compensate the holders for the value of the warrants, including because the number of shares of common stock received is capped at 0.361 share of common stock per warrant (subject to adjustment) irrespective of the remaining life of the warrants. None of the private placement warrants will be redeemable by us, subject to certain circumstances when the price equals or exceeds $10.00 per share but less than $18.00 per share in accordance with the terms of the warrant agreement, so long as they are held by Sponsor or its permitted transferees. USE OF PROCEEDS All of the securities offered by the Selling Securityholders pursuant to this prospectus will be sold by the Selling Securityholders for their respective accounts. We will not receive any of the proceeds from these sales. Assuming the exercise of all the warrants, assumed warrants and Former Employee Options for cash, we will receive an aggregate of approximately $302 million, but will not receive any proceeds from the sale of the shares of common stock issuable upon such exercises. If the warrants are exercised pursuant to a cashless exercise feature, we will not receive any cash from these exercises. Up to approximately 900,000 shares (which represents an estimate of the maximum number of shares that may be issued) issuable pursuant to assumed warrants will be issuable only pursuant to the net exercise provisions thereof, and we will not receive any cash proceeds from such exercises. There is no assurance that warrants, assumed warrants or Former Employee Options will be in the money prior to their expiration or that the holders of such securities will elect to exercise any or all of such securities. We believe the likelihood that these warrant holders will exercise such securities, and therefore any cash proceeds that we may receive in relation to the exercise of such securities being offered for sale in this prospectus, will be dependent on the trading price of our common stock. If the market price for our common stock is less than the exercise price of warrants, assumed warrants or Former Employee Options, we believe the holders of such securities will be unlikely to exercise such securities. We expect to use the net proceeds from the exercise of the warrants, assumed warrants and Former Employee Options, if any, for working capital and general corporate purposes. We will have broad discretion over the use of any proceeds from the exercise of the warrants, assumed warrants and Former Employee Options. The Selling Securityholders will pay any underwriting discounts and commissions and expenses incurred by the Selling Securityholders for brokerage, accounting, tax or legal services or any other expenses incurred by the Selling Securityholders in disposing of the securities. We will bear the costs, fees and expenses incurred in effecting the registration of the securities covered by this prospectus, including all registration and filing fees, NYSE listing fees and fees and expenses of our counsel and our independent registered public accounting firm. DETERMINATION OF OFFERING PRICE The offering price of the shares of common stock underlying the warrants, assumed warrants and Former Employee Options offered hereby is determined by reference to the respective exercise prices of such instruments. The exercise price of the warrants is $11.50 per share. The public warrants are listed on the NYSE under the symbol FRGE WS . We cannot currently determine the price or prices at which shares of our common stock or warrants may be sold by the Selling Securityholders under this prospectus. 39 Table of Contents DIVIDEND POLICY We currently intend to retain all available funds and any future earnings to fund the growth and development of our business. We have never declared or paid any cash dividends on our capital stock. We do not intend to pay cash dividends to our stockholders in the foreseeable future. Investors should not purchase our common stock with the expectation of receiving cash dividends. Any future determination to declare dividends will be made at the discretion of our Board and will depend on our financial condition, operating results, capital requirements, general business conditions, and other factors that our Board may deem relevant. MARKET INFORMATION The common stock and warrants to purchase common stock began trading on the NYSE under the symbols FRGE and FRGE WS , respectively, on March 22, 2022. On May 17, 2022, the closing sale price of our common stock was $21.88 per share and the closing price of the public warrants was $1.57 per warrant. As of May 17, 2022, there were approximately 236 registered holders of common stock and 8 registered holders of warrants. The Company has not paid any cash dividends on shares of its common stock. Any decision to declare and pay dividends in the future will be made at the sole discretion of the Board and will depend on, among other things, the Company s results of operations, cash requirements, financial condition, contractual restrictions and other factors that the Board may deem relevant. SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS As of the Closing, we had (i) 12,899,504 shares of common stock authorized for issuance under the Forge Global Holdings, Inc. 2022 Stock Option and Incentive Plan (the 2022 Plan ) and (ii) 4,072,000 shares of common stock authorized for issuance under the Forge Global Holdings, Inc. 2022 Employee Stock Purchase Plan (the 2022 ESPP ). In addition, we had 15,039,376 shares of common stock reserved for issuance pursuant to outstanding options under or subject to the Forge Global, Inc. 2018 Stock Incentive Plan (the 2018 Plan ) which were assumed in the Business Combination. We intend to file one or more registration statements on Form S-8 under the Securities Act to register the shares of common stock issuable under the 2022 Plan, the 2018 Plan and the 2022 ESPP. 40 Table of Contents UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION The unaudited pro forma condensed combined financial information has been prepared in accordance with Article 11 of SEC Regulation S-X as amended by the final rule, Release No. 33-10786 Amendments to Financial Disclosures about Acquired and Disposed Businesses and is for informational purposes only. The combined financial information presents the pro forma effects of the following transactions, collectively referred to as the Transactions for purposes of this section, and certain other related events as described in Note 1 to the accompanying Notes to the unaudited pro forma condensed combined financial information: The reverse recapitalization of Forge Global, Inc. ( Forge ), referred to herein as the Business Combination, and the issuance of Domestication common stock in the PIPE Financing (as defined below) and pursuant to the Amended and Restated Forward Purchase Agreement (the A&R FPA ). As contemplated by the Merger Agreement, following the Domestication of Motive Capital Corp ( Motive ), a Cayman Islands exempted company, FGI Merger Sub, Inc. ( FGI Merger Sub ) merged with and into Forge, whereupon the separate existence of FGI Merger Sub ceased, and Forge is the surviving corporation and a wholly owned subsidiary of New Forge . The unaudited pro forma condensed combined balance sheet of New Forge as of December 31, 2021 combines the historical consolidated balance sheet of Forge as of December 31, 2021 and the historical consolidated balance sheet of Motive as of December 31, 2021, adjusted to give pro forma effect to the Business Combination, the PIPE Financing, the A&R FPA, and certain other related events related to the Business Combination between Forge and Motive, in each case, as if the Business Combination, the PIPE Financing, the A&R FPA, and certain other related events had been consummated on December 31, 2021. The unaudited pro forma condensed combined statement of operations of New Forge for the year ended December 31, 2021 combines the historical consolidated statement of operations of Forge for the year ended December 31, 2021, the historical consolidated statement of operations of Motive for the year ended December 31, 2021, on a pro forma basis as if the Business Combination, the PIPE Financing, the A&R FPA, and certain other related events, as discussed below, related to the Business Combination between Motive and Forge, in each case, as if the Transactions and certain other related events had been consummated on January 1, 2021. The unaudited pro forma condensed combined financial information should be read in conjunction with the following, which are included elsewhere in this prospectus: the accompanying Notes to the unaudited pro forma condensed combined financial statements; the historical audited consolidated financial statements of Motive as of and for the year ended December 31, 2021 included in Motive s Annual Report on Form 10-K included in this prospectus; the historical audited condensed consolidated financial statements of Forge as of and for the year ended December 31, 2021, which are included as exhibits to this prospectus; and other information related to Motive and Forge included in this prospectus, including the Merger Agreement and the description of certain terms thereof. The unaudited pro forma combined financial information should also be read together with Management s Discussion and Analysis of Financial Condition and Results of Operations, and other financial information included elsewhere in this prospectus. Business Combination On September 13, 2021, Motive and its wholly-owned subsidiary, FGI Merger Sub, Inc. ( Merger Sub ), entered into the Merger Agreement with Forge Global, Inc. The Business Combination was completed on March 21, 2022. Concurrently with the execution of the Merger Agreement, Motive entered into Subscription Agreements (the Subscription Agreements ) with certain investors (the PIPE Investors ), pursuant to which the PIPE Investors agreed to subscribe for and purchase, and Motive agreed to issue and sell to the PIPE Investors, an aggregate of 6,850,000 shares of Domestication Common Stock at a price of $10.00 per share, for aggregate gross proceeds of $68,500,000 (the PIPE Financing ). 41 Table of Contents Pursuant to the A&R FPA, certain Motive fund vehicles managed by an affiliate of Motive purchased 14,000,000 units at $10.00 per unit, for an aggregate purchase price of $140.0 million in a private placement that closed substantially concurrently with the closing of the Business Combination ( the Closing ). Each unit consists of one share of Domestication Common Stock and one-third of one Domestication Public Warrant. (i)Motive became a Delaware corporation (the Domestication ) and, in connection with the Domestication. (A)Motive s name changed to New Forge . (B)Each then-issued and outstanding Class A ordinary share, par value of $0.0001 per share, of Motive (the Motive Class A Shares ) converted automatically, on a one-for-one basis, into a share of common stock, par value of $0.0001 per share, of New Forge (the Domestication Common Stock ); (C)Each then-issued and outstanding Class B ordinary share, par value of $0.0001 per share, of Motive (the Motive Class B Shares ) converted automatically, on a one-for-one basis, into a share of Domestication Common Stock; (D)Each then-issued and outstanding public warrant of Motive (the Motive Public Warrants ) represents a right to acquire one share of Domestication Common Stock for $11.50 (the Domestication Public Warrants ); (E)Each then-issued and outstanding private placement warrant of Motive (the Motive Private Warrants ) represents a right to acquire one share of Domestication Common Stock for $11.50 (the Domestication Private Warrants ); and (F)Each of the then-issued and outstanding Motive Units, including such Motive Units issued in connection with Motive s initial public offering, that have not been previously separated into the underlying Motive Class A Shares and underlying Motive Public Warrant upon the request of the holder thereof (the Motive Units ), separated and entitle the holder thereof to one share of Domestication Common Stock and one-third of one Domestication Public Warrant. No fractional Domestication Public Warrant was issued upon separation of the Motive Units. (ii)Following the Domestication, FGI Merger Sub merged with and into Forge Global, Inc., with Forge Global, Inc. as the surviving company in the merger, and after giving effect to such merger, Forge continues as a wholly-owned subsidiary of the Company (the Merger ). The Domestication, the Merger and the other transactions contemplated by the Merger Agreement are hereinafter referred to as the Business Combination. In connection with the Business Combination, the Company adopted a single class stock structure pursuant to which: (i)The Class A ordinary shares and the Class B ordinary shares of Motive outstanding prior to the Business Combination were converted into Domestication Common Stock; (ii)The vested shares of Forge Global, Inc. capital stock, including the issued outstanding Class AA Common Stock and Forge Global, Inc. Preferred Stock were exchanged at the Exchange Ratio of 3.1229310539577 set forth in the Merger Agreement, for Domestication Common Stock; and (iii)The unvested shares of Forge Global, Inc. capital stock outstanding prior to the Business Combination were exchanged, at the Exchange Ratio of 3.1229310539577 set forth in the Merger Agreement, for shares of Domestication Common Stock. Each Forge common stock warrant and preferred stock warrant outstanding immediately prior to the consummation of the Business Combination was assumed by New Forge and exchanged into warrants exercisable into Domestication Common Stock based on the Exchange Ratio of 3.1229310539577. Additionally, the exercise price of each converted warrant was determined by dividing the exercise price of the respective Forge warrants by the Exchange Ratio, rounded up to the nearest whole cent. Each Forge option outstanding immediately prior to the consummation of the Business Combination was assumed by New Forge and exchanged into an option exercisable into Domestication Common Stock based on the Exchange Ratio of 3.1229310539577. Additionally, the exercise price of each converted option was determined by dividing the exercise price of the respective Forge options by the Exchange Ratio, rounded up to the nearest whole cent. 42 Table of Contents UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET AS OF DECEMBER 31, 2021 (in thousands) (in thousands) Forge (Historical) Motive Capital Corp (Historical) Pro Forma Transaction Accounting Adjustments Pro Forma Combined Assets Current assets: Cash and cash equivalents $ 74,781 $ 255 $ 414,111 (A) $ 218,542 68,500 (B) 140,000 (C) (14,490) (D) (42,491) (E) (5,448) (F) (10,287) (N) (406,389) (Q) Restricted cash 1,623 1,623 Accounts receivable, net 5,380 5,380 Prepaid expenses and other current assets 5,148 274 5,422 Payment-dependent notes receivable at fair value, current 1,153 1,153 Total current assets $ 88,085 $ 529 $ 143,506 $ 232,120 Investments and cash held in Trust Account 414,111 (414,111) (A) Property and equipment, net 497 497 Internal-use software, net 2,691 2,691 Goodwill and other intangibles, net 137,774 137,774 Operating lease right-of-use assets 7,881 7,881 Payment-dependent notes receivable at fair value, noncurrent 13,453 13,453 Other assets 7,514 (5,923) (E) 1,591 Total Assets $ 257,895 $ 414,640 (276,528) $ 396,007 Liabilities, convertible preferred stock and stockholders equity (deficit) Current liabilities: Accounts payable 1,920 4,358 (4,358) (F) 1,920 Accrued compensation and benefits 21,240 21,240 Accrued expenses and other current liabilities 8,343 1,090 (1,090) (F) 8,701 (969) (E) 1,327 (I) Operating lease liabilities, current 5,367 5,367 Payment-dependent notes payable at fair value, current 1,153 1,153 Total current liabilities $ 38,023 $ 5,448 $ (5,090) $ 38,381 Deferred underwriting commissions 14,490 (14,490) (D) Payment-dependent notes payable at fair value, noncurrent 13,453 13,453 Operating lease liabilities, noncurrent 5,159 5,159 Derivative liabilities, at fair value 7,844 24,430 4,760 (C) 31,370 (2,844) (M) (2,820) (O) Total liabilities $ 64,479 $ 44,368 $ (20,484) $ 88,363 Commitments and contingencies Class A ordinary shares subject to possible redemption 414,000 (414,000) (G) Convertible preferred stock 246,056 (246,056) (H) Stockholders equity (deficit): Motive Capital Class A ordinary shares 4 (G) (4) (K) Motive Capital Class B ordinary shares 1 (1) (K) Forge common stock Domestication Common Stock 1 (B) 18 2 (C) 14 (J) 5 (K) (4) (Q) Additional paid-in capital 25,919 68,499 (B) 404,759 135,238 (C) (47,445) (E) 413,996 (G) 246,056 (H) 4,174 (I) (14) (J) (43,729) (L) 2,844 (M) 5,606 (P) (406,385) (Q) Accumulated deficit (78,559) (43,729) (5,501) (I) (97,113) 43,729 (L) (10,287) (N) 2,820 (O) (5,606) (P) Total stockholders equity (deficit) $ (52,640) $ (43,728) $ 404,012 $ 307,644 Total liabilities, convertible preferred stock and stockholders equity (deficit) $ 257,895 $ 414,640 $ (276,528) $ 396,007 43 Table of Contents UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2021 (in thousands, except share and per share amounts) For the Year Ended December 31, 2021 For the Year Ended December 31, 2021 For the Year Ended December 31, 2021 Forge (Historical) Motive Capital Corp (Historical) Pro Forma Transactions Accounting Adjustment Pro Forma Combined Revenues Placement fees $ 107,723 $ $ $ 107,723 Custodial administration fees 20,333 20,333 Total revenues $ 128,056 $ $ $ 128,056 Transaction-based expenses: Brokerage and exchange fees (3,034) (3,034) Total revenues, less transaction-based expenses $ 125,022 $ $ $ 125,022 Operating expenses Compensation and benefits 94,654 21,394 (cc) 116,048 Professional services 12,450 12,450 Acquisition-related transaction and integration cost 882 882 Advertising and market development 5,090 5,090 Rent and occupancy 3,744 3,744 Technology and communications 8,243 8,243 General and administrative 4,358 6,829 11,187 Depreciation and amortization 5,390 5,390 Total operating expenses $ 134,811 $ 6,829 $ 21,394 $ 163,034 Operating loss $ (9,789) $ (6,829) $ (21,394) $ (38,012) Interest income (expense) and other income (expense) Interest income (expense), net (2,307) 91 (91) (aa) (2,307) Change in fair value of derivative liabilities (6,064) 16,102 2,592 (bb) 12,630 Other income, net 47 47 Total interest income (expenses) and other income (expenses) $ (8,324) $ 16,193 $ 2,501 $ 10,370 Income (loss) before provision for income taxes (18,113) 9,364 (18,893) (27,642) Provision for income taxes 386 386 Net and comprehensive (loss) income $ (18,499) $ 9,364 $ (18,893) $ (28,028) Weighted average shares of common stock outstanding basic and diluted 17,386,008 Net loss per share of common stock- basic and diluted $ (1.06) Weighted average shares of Motive Class A redeemable ordinary Shares outstanding basic and diluted 41,400,000 Net income per share of Motive Class A redeemable ordinary Shares basic and diluted $ 0.18 Weighted average shares of Motive Class B non-redeemable ordinary Shares outstanding basic and diluted 10,350,000 Net income per share of Motive Class B non-redeemable ordinary Shares basic and diluted $ 0.18 Weighted average shares of Domestication Common Stock outstanding basic and diluted 164,647,584 Net loss per share of Domestication Common Stock basic and diluted $ (0.17) 44 Table of Contents Note 1 Description of the Merger Merger between Motive and Forge Business Combination Pursuant to the Merger Agreement, following the Domestication, FGI Merger Sub ( Merger Sub ) merged with and into Forge (the Company ), whereupon the separate existence of FGI Merger Sub ceased, and Forge was the surviving corporation and a wholly owned subsidiary of New Forge. Following the Closing, (a) New Forge owns all the equity interests of Forge and (b) the former equity holders of Forge hold a portion of the Domestication Common Stock. The aggregate consideration for the Business Combination paid to holders of Forge capital stock includes Securities Merger Consideration (as defined in the Merger Agreement), after giving effect to the Exchange Ratio, is as follows: in thousands (except share and per share data) Shares transferred at Closing(1) 149,789,311 Value per Share(2) $ 10 Share consideration $ 1,497,893 (1)The number of shares transferred to holders of Forge capital stock upon consummation of the Business Combination include (i) 137.3 million New Forge common stock, (ii) 11.6 million assumed options, and (iii) 0.9 million of assumed warrants. In the table above, the value allocable to assumed Forge options and assumed Forge warrants is determined based on the treasury stock method. (2)Share consideration is calculated using a $10 reference price. The actual total value of share consideration will be dependent on the value of the common stock at the Closing; however, there is no expected change from any change in the Domestication Common Stock s trading price on the pro-forma financial statements as the Business Combination will be accounted for as a reverse recapitalization. The unaudited pro forma combined information contained herein reflects Motive s shareholders approval of the Business Combination on March 15, 2022, and that Motive s public shareholders holding 40,638,953 Motive Class A ordinary shares elected to redeem their shares prior to the Closing. The following summarizes the pro forma Domestication Common Stock issued and outstanding immediately after the Business Combination, after giving effect to the Exchange Ratio: Pro Forma Combined % Ownership Forge(1)(4) 137,262,779 81.1 % PIPE Investors 6,850,000 4.0 % Holders of Motive Class A Shares 761,047 0.4 % Holders of Motive Class B Shares(2) 10,350,000 6.2 % A&R FPA Investors(3) 14,000,000 8.3 % Pro Forma common stock at the Closing 169,223,826 (1)Includes 23,668,198 shares of Forge convertible preferred stock, which were exchanged for Domestication Common Stock at the Exchange Ratio of 3.1229310539577 pursuant to the Merger Agreement. (2)Through the Motive Class B Shares and the shares issued in connection with the Forward Purchase Agreement shares, the Sponsor and its related affiliates owned 14.5% of Domestication Common Stock outstanding following the Closing. Includes 10,350,000 shares held by the Sponsor or its affiliates, which are subject to certain lock-up provisions pursuant to the terms of the Sponsor Support Agreement. (3)Represents the A&R FPA entered into with certain affiliates of the Sponsor to provide for the purchase by it (or its designees) of 14,000,000 units at $10.00 per unit for an aggregate purchase price of $140 million in a price placement that closed concurrently with the Closing of the Business Combination. The proceeds from the sale of the forward purchase units as well as PIPE Financing and the proceeds from the Motive Trust were used to pay expenses in connection with the Business Combination and for working capital in the post-business combination company. The forward purchase was intended to provide Motive with a minimum funding level for the Business Combination. 45 Table of Contents (4)As described elsewhere in this prospectus, New Forge s stockholders have appraisal rights in connection with a merger or consolidation of New Forge. Stockholders who properly request and perfect appraisal rights in connection with such merger or consolidation will have the right to receive payment of the fair value of their shares as determined by the Delaware Court of Chancery. This amount excludes 210,302 shares that were not issued upon the Closing as a result of a shareholder s demand for appraisal rights. If the appraisal rights demand is withdrawn or not perfected with the Delaware Court of Chancery, these shares will be issued to the shareholder. Note 2 Basis of the Pro Forma Presentation The Business Combination was accounted for as a reverse recapitalization in accordance with U.S. generally accepted accounting principles, with no goodwill or other intangible assets recorded in accordance with Financial Accounting Standards Board s Accounting Standards Codification Topic 805, Business Combinations ( ASC 805 ). Motive will be treated as the acquired company for financial reporting purposes and Forge has been determined to be the accounting acquirer. Accordingly, the Business Combination will be treated as the equivalent of Forge issuing stock for the net assets of Motive, accompanied by a recapitalization. The net assets of New Forge will be stated at historical cost, with no goodwill or other intangible assets recorded. Operations prior to the Business Combination will be those of Forge. Forge has been determined to be the accounting acquirer based on a number of considerations, including but not limited to: i)Forge Global, Inc. former management making up the majority of the Management Team of New Forge; ii)Forge Global, Inc. former management and directors nominating or representing the majority of New Forge s board of directors; and iii)Forge Global, Inc. representing the majority of the continuing operations of New Forge. Management has also determined Forge to be the predecessor entity to the Merger Agreement based on the same considerations listed above. The unaudited pro forma condensed combined financial statements were prepared in accordance with Article 11 of SEC Regulation S-X as amended by the final rule, Release No. 33-10786 Amendments to Financial Disclosures about Acquired and Disposed Businesses. Release No. 33-10786 replaces the existing pro forma adjustment criteria with simplified requirements to depict the accounting for the transaction ( Transaction Accounting Adjustments ) and present the reasonably estimable synergies and other transaction effects that have occurred or are reasonably expected to occur ( Management s Adjustments ). Motive has elected not to present Management s Adjustments and will only be presenting Transaction Accounting Adjustments in the following unaudited pro forma combined financial information to provide relevant information necessary for an understanding of the combined company upon consummation of the Business Combination. Management has made significant estimates and assumptions in its determination of the pro forma adjustments based on information available as of the date of filing this prospectus and is subject to change as additional information becomes available and analyses are performed. As the unaudited pro forma condensed combined financial information has been prepared based on these preliminary estimates, the final amounts recorded may differ materially from the information presented as additional information becomes available. Management considers the basis of presentation to be reasonable under the circumstances. The unaudited pro forma condensed combined financial information does not give effect to any anticipated synergies, operating efficiencies, tax savings, or cost savings that may be associated with the Transactions. Forge has not had any historical relationship with neither Motive prior to the Business Combination. Accordingly, no Transaction Accounting Adjustments were required to eliminate activities between the companies. The unaudited pro forma condensed combined balance sheet does not purport to represent, and is not necessarily indicative of, what the actual financial condition of the combined company would have been had the Transactions taken place on December 31, 2021, nor is it indicative of the financial condition of the combined company as of any future date. The unaudited pro forma condensed combined financial information is for illustrative purposes only and is not necessarily indicative of what the actual results of operations and financial position would have been had the Business Combination, the PIPE Financing, the A&R FPA, and certain other related events taken place on the dates indicated, nor are they indicative of the future consolidated results of operations or 46 Table of Contents financial position of the combined company. The unaudited pro forma condensed combined financial information is subject to several uncertainties and assumptions as described in the accompanying notes. Total one-time direct and incremental transaction costs (i.e. Transaction costs ) incurred prior to, or concurrent with, the consummation are reflected in the unaudited pro forma condensed balance sheet as a direct reduction to New Forge additional paid-in capital and are assumed to be cash settled. Note 3 Accounting Policies Based on its analysis of Forge and Motive s policies, Forge and Motive did not identify any differences in accounting policies that would have an impact on the unaudited pro forma condensed combined consolidated information. As a result, the unaudited pro forma condensed combined financial information does not assume any differences in accounting policies. Note 4 Pro Forma Adjustments The unaudited pro forma condensed combined balance sheet as of December 31, 2021 has been prepared for informational purposes only. The unaudited pro forma condensed combined balance sheet as of December 31, 2021 includes Transaction Accounting Adjustments that are directly attributable to the Business Combination, the PIPE Financing, the A&R FPA, and certain other related events. Motive and Forge have not had any historical relationship prior to the business combination. Accordingly, no pro forma adjustments were required to eliminate activities between the companies. The pro forma combined provision for income taxes does not necessarily reflect the amounts that would have resulted had the post-combination company filed consolidated income tax returns during the periods presented. Transaction Accounting Adjustments to Unaudited Pro Forma Combined Balance Sheet The adjustments included in the unaudited pro forma combined balance sheet as of December 31, 2021 are as follows: (A)The reclassification of $414.1 million of cash held in the Motive Trust Account that became available at the Closing. (B)In connection with the signing of the Merger Agreement, Motive entered into subscription agreements with certain PIPE Investors. Pursuant to the Subscription Agreements, the PIPE Investors agreed to subscribe for and purchase, and Motive agreed to issue and sell to such investors 6,850,000 shares of Domestication Common Stock with a par value of $0.0001, resulting in gross proceeds of $68.5 million. (C)The settlement of $140.0 million in cash received by Motive from the purchase of 14,000,000 shares of Domestication Common Stock and 4,666,664 Domestication Public Warrants pursuant to the A&R FPA. As the warrants issued under the A&R FPA have the same terms as the public warrants, they are reflected on the unaudited pro forma combined balance sheet as derivative liabilities. (D)The settlement of $14.5 million of Motive s deferred underwriting fees payable. (E)The settlement of approximately $47.4 million of acquisition-related transaction costs incurred in connection with the Merger. These acquisition-related transaction costs are in connection with the Closing and related transactions and are deemed to be direct and incremental costs of the Business Combination. The acquisition-related transactions costs are accounted for as equity issuance costs and the unaudited pro forma condensed balance sheet reflects these costs as a reduction in cash with a corresponding decrease to additional paid-in-capital, offset by a decrease of $5.9 million in other assets and a decrease of $1.0 million in accrued expenses and other current liabilities. (F)The settlement of Motive s historical liabilities that were settled at transaction close. (G)The recapitalization of Motive Class A Shares subject to actual redemption to permanent equity at $0.0001 par value. 47 Table of Contents (H)The conversion of Forge convertible preferred stock into shares of Forge Class AA Common Stock, which shares were cancelled and converted into the right to receive shares of Domestication Common Stock pursuant to the Exchange Ratio concurrent with the Closing. (I)The issuance of Forge Class AA Common Stock secured by promissory notes issued to certain executives, which were extinguished in connection with the Business Combination. Forge had granted certain promissory notes to executives in exchange for early exercised options. Immediately prior to the completion of the Business Combination $5.5 million of the promissory notes were extinguished, and the expense represents the outstanding balance of the promissory notes and accrued interest on the date of the Closing. Because the issuances of the promissory notes were off- balance sheet transactions, it is reflected as an adjustment of $4.2 million to additional paid-in capital for the vested portion of the early exercised options and an adjustment of $1.3 million to accrued expenses for the unvested portion of the early exercised options (J)The conversion of Forge Class AA Common Stock into Domestication Common Stock pursuant to the Exchange Ratio concurrent with the Closing. (K)The recapitalization of Motive Class A Shares and Motive Class B Shares converted into 11,111,047 shares of Domestication Common Stock. (L)The reclassification of Motive s historical accumulated deficit to additional paid-in capital as part of the merger. (M)The exchange of Forge s May 2020 warrants and October 2020 warrants into warrants to purchase shares of Domestication Common Stock, pursuant to terms of the Merger Agreement. The May 2020 warrants and October 2020 warrants preferred stock warrants were previously redeemable, resulting in Forge classifying such warrants as liabilities in its historical financial statements. However, the warrants to purchase shares of Domestication Common Stock exchanged for Junior preferred warrants will remain classified as a liability, as the Company has an obligation to issue a variable number of shares of Domestication Common Stock for a fixed monetary amount of $5.0 million. (N)The settlement of the total bonus of $15.8 million made to Forge employees upon close of the Business Combination, of which $5.5 million was applied to outstanding balance of promissory notes issued to certain executives, which were extinguished immediately prior to the Business Combination. The remaining $10.3 million of the bonus was paid in cash to Forge employees. See Note (I) for the impact of the outstanding promissory note balance on the unaudited pro forma combined balance sheet. (O)The elimination of the historical A&R FPA derivative liability of $2.8 million. (P)The additional $5.6 million of stock-compensation expense associated with options that became vested upon the consummation of a deemed liquidation event or SPAC transaction. (Q)The redemption of 40,638,953 shares of Motive Class A ordinary shares redeemed for $406.4 million allocated to common stock and additional paid-in capital, using a par value of $0.0001 per share at a redemption price of approximately $10.00 per share. Transaction Accounting Adjustments to Unaudited Pro Forma Condensed Combined Statement of Operations The pro forma adjustments included in the unaudited pro forma condensed combined statement of operations for the year ended December 31, 2021 are as follows: (aa) Reflects elimination of interest income on Motive s Trust Account. (bb) Reflects reversal of $2.6 million change in fair value of Forge s May 2020 warrants and October 2020 warrants to purchase Forge convertible preferred stock. (cc) Reflects incremental expense of $21.4 million, which includes $10.3 million of cash bonuses made to certain Forge employees in connection with the Business Combination, $5.5 million of compensation and benefits expense incurred upon the extinguishment of promissory notes issued to certain executives and the corresponding issuance of Forge Class AA 48 Table of Contents Common Stock, and $5.6 million of stock-compensation expense associated with options that will vest upon the consummation of a deemed liquidation event or SPAC transaction. Note 5 Net Loss per Share Represents the net loss per share calculated using the historical weighted average shares outstanding and the issuance of additional shares in connection with the Business Combination, the PIPE Financing, the A&R FPA, and certain other related events, assuming such additional shares were outstanding since January 1, 2021. As the Business Combination, the PIPE Financing, the A&R FPA, and certain other related events are being reflected as if they had occurred as of January 1, 2021, the calculation of weighted average shares outstanding for basic and diluted net loss per share assumes the shares issued in connection with the Business Combination, the PIPE Financing, the A&R FPA, and certain other related events have been outstanding for the entire periods presented. The unaudited pro forma combined financial information for the year ended December 31, 2021 has been prepared based on the following information: For the year ended December 31, 2021 (in thousands, except share and per share data) Pro Forma Combined Numerator: Pro forma net loss $ (28,028) Plus: Pro forma adjustment related to interest expense on convertible notes(1) 82 Pro forma net loss available to common stockholders, basic $ (27,946) Denominator: Weighted average shares of Domestication Common Stock outstanding basic and diluted 164,647,584 Net loss per share of Domestication Common Stock basic and diluted $ (0.17) Weighted average shares of Domestication Common Stock outstanding basic and diluted Forge 132,686,537 Holders of Motive Class A Shares 761,047 Holders of Motive Class B Shares 10,350,000 PIPE Investors 6,850,000 A&R FPA Investors 14,000,000 Weighted average shares of Domestication Common Stock outstanding basic and diluted 164,647,584 (1)Reflects the reversal of the actual interest expense incurred on Forge s convertible notes outstanding during the year ended December 31, 2021 assuming they were converted to shares of Domestication Common Stock on January 1, 2021. Following the Closing, the following outstanding securities were excluded from the computation of pro forma net loss per share, basic and diluted, because including them would have had an anti-dilutive effect: For the year ended December 31, 2021 Pro Forma Combined Forge options that will convert into a right to purchase shares of Domestication Common Stock(1) 13,587,736 Forge warrants to purchase shares of Domestication Common Stock(2) 3,774,436 Motive warrants to purchase shares of Domestication Common Stock(3) 21,186,667 Motive warrants to purchase shares of Domestication Common Stock pursuant to the A&R FPA(4) 4,666,664 43,215,503 (1)All outstanding options exercisable for shares of Forge common stock, whether vested or unvested, were assumed by Motive and automatically converted into an option to purchase a number of shares of Domestication Common Stock, determined in accordance with the Exchange Ratio. (2)Includes the nominal face amount of Junior preferred warrants which are only exercisable pursuant to net exercise for a variable number of shares of Domestication Common Stock, subject to a maximum of $5.0 million in aggregate. 49 Table of Contents (3)One whole warrant entitles the holder thereof to purchase one share of Domestication Common Stock at a price of $11.50 per share. Domestication Public Warrants and Domestication Private Warrants are anti-dilutive on a pro forma basis and have been excluded from the diluted number of shares of Domestication Common Stock outstanding at the time of the Closing. (4)Represents the warrants issued in connection with the A&R FPA entered into with certain affiliates of the Sponsor to provide for the purchase by it of 14,000,000 units, which includes one-third of one Domestication Public Warrant. One whole warrant entitles the holder thereof to purchase one share of Domestication Common Stock at a price of $11.50 per share. Domestication Public Warrants are anti-dilutive on a pro forma basis and have been excluded from the diluted number of shares of Domestication Common Stock outstanding at the time of the Closing. 50 Table of Contents BUSINESS At Forge, we firmly believe that everyone should have the opportunity to participate in the private market and have built technology and solutions to power an accessible, liquid, and transparent private market for everyone. Our mission is to give a broader group of people the ability to buy and sell private shares in some of the world s most innovative companies and help all who participate in the private market economy to accelerate destiny. Forge is a leading provider of marketplace infrastructure, data services, and technology solutions for private market participants. Our global online trading platform, Forge Markets, enables accredited institutional and individual investors to purchase private company shares from current and former employees, as well as existing investors. Our accessible and technology-enabled market makes it easy for employees to sell their private shares, for companies to reward shareholders with pre-IPO liquidity and for individual and institutional investors to contribute to and potentially benefit from private unicorn growth. Since inception, we have added complementary pillars alongside Forge Markets to provide the access, transparency and solutions that companies, as well as institutional and individual investors and shareholders need to confidently navigate and efficiently transact in the private markets. The four pillars that make up our business are: Forge Markets: Our online trading platform that connects potential investors with private company shareholders and enables them to efficiently facilitate private share transactions Forge Trust: Our non-depository trust company that enables clients to securely custody and manage non-liquid assets through a robust and user-friendly online portal Forge Data: Our data business provides market participants the information and insight to confidently navigate, analyze and make investment decisions in the private market Forge Company Solutions: Our software solution purpose built for private companies to easily administer primary and secondary financing events We have strategically invested in these four pillars because we believe they will collectively drive strong network effects and help power the private market ecosystem. Forge uniquely delivers streamlined access to the private market taking a historically analog and opaque process and modernizing it with an efficient, transparent digital platform. Forge was formed in 2014. SharesPost was formed in 2009. Forge acquired SharesPost in November of 2020. Including Forge historical data from its inception and SharesPost historical data from its inception, on a pro forma basis, as of December 31, 2021, we have facilitated over 21,000 trades in over 450 companies for buy-side and sell-side clients in 70 countries. As of December 31, 2021, we had 1,223 institutions, over 447,000 registered users, including approximately 140,000 accredited investors, all of whom have indicated interest in accessing shares in private companies through our online platform. Including Forge historical data from its inception and SharesPost historical data from its inception, we have closed 51 Table of Contents more than $12 billion in transaction volume. We had approximately $3.2 billion in transaction volume in the twelve months ending December 31, 2021, and we believe Forge is experiencing the distinct advantage of a large marketplace s scale where volume begets more volume. The Forge platform serves people who have different aspirations and needs, such as: The innovative CEO who wants to stay private and retain employees as long as it takes to achieve her long-term vision The dedicated employee who needs to pay for her child s college tuition or buy a home today and cannot afford to wait for her company to go public The passionate investor who knows that investors in the last round of a private company before IPO often see outsized gains when compared to public market investments but has historically lacked access to this investment class And institutions who provide clients investment opportunities in attractive private stocks We attribute our track record of growth to the key strategic investments we have made since inception, the remarkable efforts of our employees, the momentum contributed by our many clients, and our commitment to ensuring that our technology performs at the highest level. From creating a digital and scalable private market ecosystem, to helping our customers securely custody their assets, it is our technology, coupled with our data and operational expertise, that has been, and will continue to be, critical to enabling our long-term success. The Large and Rapidly Growing Private Market Private companies issue shares or grant options in their firms to incentivize and retain employees as part of their overall compensation package, or to fund growth by exchanging them for cash with investors. While employees and investors expect the price of the shares to rise and thus receive a positive return when the shares are sold, historically it was a challenge to monetize the shares before the company was bought or went public on a listing exchange such as NYSE or The Nasdaq Stock Market. Over the past 20 years, technology companies have increasingly stayed private longer. This is due in part to the availability of capital in the private markets, a company s desire to avoid managing its business to a quarterly earnings cycle, and the increased cost and regulatory hurdles associated with being a public company. According to a study published March 2021, by Jay Ritter, Warrington College of Business, University of Florida from 1999 to 2020: The median age of technology companies at the time of the initial public offering ( IPO ) has increased from 4 to 12 years; and The median market capitalization of these companies at the time they complete their IPO has also increased from $493 million to $4.3 billion. Many of these private companies are building substantial value for their shareholders and growing quickly with the help of unprecedented levels of investment capital. However, more of that growth and value creation is now taking place while they remain private. Unless investors can access and participate in that growth before the companies go public or are acquired, outside investors do not have an opportunity to benefit from the value that is created. 52 Table of Contents A good benchmark demonstrating how quickly the private market is growing is the number of unicorns created, as well as market capitalization associated with them. A unicorn is defined as a company with an equity valuation more than $1 billion. According to Business Today and CB Insights: As of March 2022, there are more than 1,000 unicorns, with 734 formed since 2020 and 519 in 2021 alone; Since December 2021, the number of unicorns has grown by 13.9%; and These unicorns combined represent a $3.4 trillion equity value opportunity according to CB Insights. As a result of these trends, a growing number of shareholders and employees seek liquidity while companies remain private. At the same time, companies need technology and services to ensure they re able to manage their shareholders needs and to stay competitive when hiring and retaining talent. In 2020, investors contributed over $270 billion into private companies because they wanted to participate in the innovation economy, and they understood this is where the best potential returns are often realized. When you compare the 12-month performance of IPOs from 2010-2020 versus the performance had you invested in the round prior to the IPO, there is a marked difference. The 12-month return from IPOs during that time period is 37%, while the return had you invested in the round prior to the IPO is 277%. Challenges in the Private Markets Historically, participating in the private market was a complex and opaque endeavor for a number of reasons, including: Lack of Liquidity The private markets lacked technology, automated processes, and standardized documentation which led to an inefficient and illiquid market with little volume. Transactions were done primarily offline using manual and administratively burdensome steps that demanded significant time and effort. These issues were compounded because of market fragmentation; there was not a large-scale marketplace where many buyers and sellers could transact with one another across a large swath of potential companies. Lack of Access Gaining access to opportunities in private companies was extremely difficult and until recently, was only available to a small number of well-connected investors primarily made up of brand name angel investors and venture capital firms. In addition, the investment minimums were prohibitively high, usually in the millions of dollars, which also excluded most individual investors from participation. Lack of Transparency There was little information on private companies easily accessible to non-insiders. On the transactional side, information such as the amount of buy-side and sell-side interest in the companies, and the pricing of their shares was not readily available to market participants. This lack of transparency created uncertainty with market participants who lacked the data they needed to make a well-informed investment decision. Forge s Differentiated Solutions We have developed and continue to enhance our marketplace infrastructure and complimentary solutions which are purpose-built for the needs of private market participants. We believe our robust technology platform as well as our large network of clients and partners will provide us the opportunity to transform the private market asset class and serve as the foundation on which others build their systems and businesses. Our unique and intuitive online user experience is supported by back-end technology and private market specialists that will enable Forge s four pillars to work efficiently and synergistically. In addition, Forge has established strong relationships with market participants including buyers, sellers, and companies in need of our solutions. 53 Table of Contents Forge has strategically built its business around these four pillars because of the potential network effect they provide to one another. The growth of one pillar provides the opportunity to fuel the growth in the other three, creating powerful synergies across all of them. This will not only help us provide better service for our clients, but it accelerates the growth of our business. Forge Markets Forge Markets comprehensive online trading platform is a private informational and transactional marketplace designed to efficiently connect institutional and individual accredited investors with the shareholders of private companies. Technology powers and supports trade matching, efficient trade execution and settlement at scale. The client experience is powered by an intuitive user interface that enables individual and institutional investors to register for free, explore private company data and insights, discover trade opportunities, and easily indicate trade interest for execution in these opportunities. Each prospective client must satisfy certain compliance criteria (e.g., accreditation) and provide customer identification information. Only accredited investors are eligible to invest in private stocks through our platform. Forge s robust Know Your Customer ( KYC ) and Anti-Money Laundering ( AML ) processes permit us to verify an investor s accreditation or shareholder s identity quickly and efficiently. While sellers do not need to qualify as accredited investors to sell their private stock, it is often the sale of their shares on Forge s platform that enables the shareholder to meet the requirements to qualify as an accredited investor, which in turn provides them with the opportunity to reinvest their money into other available private company stocks. Inside the Forge Markets experience, clients who are accredited investors can search for companies by name, sector, or valuation. Starting a trade on the Forge platform commences when a client submits an indication of interest ( IOI ) including whether they are buying or selling, the series of equity they want to sell or buy (e.g., preferred, common or both), and the price range and the volume range at which they are willing to buy or sell. The standard minimum transaction size on our platform is $100,000; however, we may allow an amount less than this under certain circumstances such as upon the specific request of certain sellers or to receive a partial execution of a larger order. There are two main structures of trades we enable through Forge Markets. The first is a direct secondary transfer and the second is a pooled investment vehicle ( SPV ) which can aggregate multiple buyers and multiple sellers. The transaction flow is similar for 54 Table of Contents both transaction types: a potential seller and buyer each submit an IOI, the buyers and sellers are matched up, and the company approves the transaction. We facilitate primary issuances and secondary purchases and/or sales of private company securities ( private resales ), typically in reliance on Rule 506 of Regulation D under the Securities Act. Private company securities include preferred and common stock, structured investments, and SPVs. Private resales are typically exempt from registration under the Securities Act pursuant to Sections 4(a)(1), 4(a)(2), 4(a)(7), or case law interpretations thereunder (i.e. 4(a)(1 )). From indication of interest match to close, transactions on our platform take an average of 50 days to complete. Although the seller is ultimately responsible for ensuring a valid exemption is available for a private resale, our process is designed to ascertain whether an exemption from registration is available. Purchasers through the Forge platform must be, at minimum, an accredited investor as defined by Rule 501(a) of Regulation D. In connection with a private resale, Forge monitors compliance by the seller with the applicable private resale exemptions under the Securities Act by collecting information from the buyer through an accreditation process on or off-platform and refraining from general solicitation. A typical private resale is between one buyer and one seller. Among the additional steps taken to ascertain an exemption from registration, Forge will acquire some verification of ownership from the seller, such as an issuer s cap table screenshot or a share acquisition agreement, by which we can assess how the seller came to own the shares. Pursuant to Forge s purchase agreement executed by the buyer and seller, the seller is required to provide the buyer all applicable restrictions pertaining to the shares that that seller has in his/her possession, or, in some cases, of which the seller has knowledge. The buyer s representations within the purchase agreement include but are not limited to (i) that the purchase is solely for investment purposes and not for further distribution, (ii) understanding that the securities are restricted securities and may not be freely traded, and (iii) that the sale of the securities are not registered under the Securities Act. Such representations are informative and likely dispositive as to the private nature of the proposed transaction. They evidence the material investment intent, which underscores importance of affirming that neither buyer nor seller has engaged in an underwriting process, nor could be deemed to be a statutory underwriter. Typically, an issuer s stock transfer agreement ( STA ) will supplement the representations made in the purchase agreement. In most cases, the STA will contain a copy of the legends contained on the stock certificate. Similar to the purchase agreement, the buyer s representations within the stock transfer agreement include that the purchase of securities is for investment purposes only and not for further distribution, the securities are not registered under the Securities Act, and the buyer s understanding that the securities are restricted securities. Issuers, buyers and sellers from over sixty jurisdictions use our platform. The majority of our revenues are derived from transactions involving U.S. issuers. Our operations are located in the United States. We have a local branch office in Hong Kong. Our 55 Table of Contents subsidiary, SharesPost Asia Pte Ltd., holds a Recognized Market Operator license with the Monetary Authority of Singapore; however, it currently does not engage in any business activities. Forge Markets builds interest on the supply side primarily through its organic online presence. Employees and shareholders of a private company who may be seeking to sell shares often will make those shares available through the platform. We also work directly with private companies that want to raise private capital or provide an opportunity for their employees to sell a portion of their holdings. Lastly, we also source supply from financial institutions such as venture capital and private equity firms as well as cross-over institutional investors, hedge funds, family offices and capital aggregators that look to us to solve their liquidity needs. We believe that the participant network along with the automation and workflows we have created to structure and efficiently process direct and SPV transactions are challenging to replicate, create a strong barrier to entry, and provide Forge the flexibility to optimally serve the marketplace in a manner that reflects the needs of both institutional and individual investors and does so in a way that enables companies to stay private longer while attracting and retaining the best employees. Integration with Forge s proprietary order-building engine and the platform s ease of use masks the back-end technological complexity that is required to complete a trade. Amassing the expertise to perform all the necessary tasks to complete trades at scale is technically challenging and complex. We believe that Forge is uniquely positioned in that we have built the tools, features, and functionality to automate many parts of what has traditionally been a manual and offline process. Our private market specialists provide complimentary support for buyers and sellers who have questions or need help completing their transactions. The expertise our private market specialists provide our clients is invaluable as it enables clients to quickly get educated about the steps needed to access the private markets using Forge s platform and to find answers to questions regarding the automated workflows we have built. We believe that through additional investments in technology, our platform will continue to further automate current manual processes, driving greater efficiency in the execution of private market trades. 56 Table of Contents We earn revenue on Forge Markets through placement fees that we charge buyers and/or sellers. These fees, which we call take rates or commissions, are based on several factors including size of transaction, type of structure, type of buyer and seller and use of external broker. On a proforma basis, for the year ended December 31, 2020, our net commissions averaged 2.2%, and for the twelve months ended September 30, 2021, our net commissions averaged 3.4%. Participants may pay a higher commission if the total dollar amount of the transaction is less than our typical minimum transaction amount of $100,000. We take into consideration the following factors for determining any variance in our commissions charged: availability of the security generally, estimated internal expenses on the transaction, and total cost to buyers and sellers (i.e. does the buyer or seller pay additional fees imposed by the issuer, such as for legal opinions, transfer fees or escrow fees). Forge Trust Forge Trust makes it easy and seamless for investors, equity holders and institutions to hold, value, and manage private assets. Through a South Dakota non-depository (and self-directed), individual retirement account ( SDIRA ) custody platform, Forge Trust enables account holders to invest and custody non-liquid alternative assets such as private company shares, private equity, venture capital and real estate. Forge Trust currently serves solely as a custodian of SDIRAs holding alternative assets. The evaluation of investment suitability and risks rests with the account holder and their advisor, if any. As a result, Forge Trust is not responsible for the financial performance of custodial assets and does not provide any insurance coverage for the investment risks that are entirely borne by the SDIRA owner. In addition, Forge Trust offers a powerful, highly scalable cloud-based custody platform that provides custody-as-a-service to our clients. The custody platform provides an application programming interface ( API ) that enables our clients to easily integrate and extend our custody platform to their customers. 57 Table of Contents Our custody business earns recurring revenue from annual account subscription fees, cash administration fees, partnership fees and other transactional fees on accounts held at Forge Trust. On a quarterly basis our SDIRA accounts are assessed maintenance fees that average $73 per account and asset-based fees that average $21 per account, with asset-based fees based on the complexity and the number of assets held. In addition, we assess per transaction fees that range from $5 to $75 based on the complexity of the transaction. This excludes our Custody-as-a-Service account revenues, which are negotiated with our partners and based on contractually negotiated terms. As of December 31, 2021, Forge Trust had $14.5 billion of assets under custody through 2.0 million accounts. Forge Data Today, data on the private markets and the companies within it is difficult to source, often available only in non-standard formats, and often inaccurate or not reflective of current conditions. Given Forge s significant history and expertise in trading and capital markets, as well as our relationships with private companies, Forge Data is in a unique position to provide market participants with easier access to quality information and actionable insights on private companies in a scalable and reliable way. Our goal is to become a leading provider of private market data globally and to bring innovation and transparency to market participants, so they can have the insight and confidence they need to make informed decisions and to fully participate in this growing asset class. As of December 2021, our data set contained more than 12 years of bid and offer secondary trading data, as well as real-time and historical pricing information across more than 1,700 private companies. We have aggregated, confirmed, anonymized and supplemented this data with additional details on companies that investors can use to research and analyze investment opportunities, including company descriptions, management team and investor details, financing rounds and valuations on those rounds. 58 Table of Contents Our first Forge Data product, Forge Intelligence, began a soft launch on June 1, 2021. Forge Intelligence uses proprietary technology to both source and distribute data from multiple providers, as well as our anonymized historical trade and IOI history from the Forge Markets platform. This product serves market participants that are looking for timely and accurate data to solve the inherent information asymmetry that exists within the private markets. Annual subscribers can view and analyze historical bid/ask, share price and volume information on private companies. Subscribers also have access to company waterfall charts, which can be used to analyze the changes in equity ownership and valuation resulting from different exit scenarios. Other data points include preferred equity conversion ratios and protective provisions such as liquidation preferences. Our goal is for Forge Intelligence to provide a recurring, predictable revenue stream via an annual subscription fee. We believe it could be a high-margin product once developed to scale given the low cost of serving incremental subscribers. In addition to the revenue Forge expects to generate through the data business, we believe that information provided to subscribers will drive additional trading volume on Forge Markets. Forge Intelligence officially launched in mid-September and we are now accelerating our sales and marketing efforts to raise awareness and acquire new customers. Our strategy is to advance Forge Data through the adoption of our platform and continue to expand our product offerings. Forge Company Solutions Forge Company Solutions is a comprehensive software solution, supported by private market experts, that supports companies running financing processes and seeks to reduce the administrative burden that companies incur through our automation and online technologies. Forge Company Solutions provides companies with oversight and control of company share transactions, including primary financings and company sponsored secondary programs, block trades, tender programs and pre-direct listing trading. Company Sponsored Primary and Secondary Programs: Enables the private company to determine transaction timing sell limits and type of participating investors. The company enables controlled secondary trading during selected windows of 59 Table of Contents time between approved employees or shareholders and buyers who are sourced by the company or Forge and pre-approved by the company. Tender Programs & Company Repurchases: Forge s tender offer functionality provides standardized documentation and streamlined workflows to efficiently run liquidity processes for shareholders and investors. Tender offers are time bound and are typically conducted at a singular price. The company pre-approves the sellers, who can sell a portion of their equity as well as the buyers who are sourced by Forge or brought to the tender by the company. Block Trades: Individual and institutional shareholders can sell large blocks of private company shares to a company-approved individual or institutional accredited investor through either direct transactions or SPVs. Pre-Direct Listing Programs: Leverages Forge Markets demand to help companies facilitate continuous secondary marketplace trading prior to a direct listing. Companies decide the parameters through which investors and shareholders can engage and remain in control of their cap tables. Forge personnel use the insights provided through the Forge Markets trading platform, as well as the pricing information from Forge Data, to help inform and advise the issuer prior to and during the transactions. Forge Company Solutions functionality includes customizable online dashboards for experiences that keep employers and participating shareholders informed throughout the process and provides a powerful repository of standardized documents that event participants can use to manage and execute the event efficiently. The technology provides real-time status, which ensures that both the Company and shareholders see the most up-to-date information. While the capital program is running, we provide in-product chat support to answer employee or shareholder questions. Forge s open operating model will allow Forge to integrate with cap table providers so programs small and large can be executed seamlessly and cap tables can be updated efficiently. We have established and continue to pursue cap table partnerships and will 60 Table of Contents develop the integrations necessary to ensure that when running programs through Forge, the companies cap table will automatically update with changes in ownership. In addition, Forge Company Solutions will provide settlement process management functionality. We earn revenue through negotiated fees associated with the use of our Forge Company Solutions software and the trading activity at Forge Markets that is made available from running liquidity programs through Forge Company Solutions. We believe the use of liquidity programs for employees has and will continue to be an important part of Companies benefit programs and that Forge Company Solutions will be the benefactor of this market trend. We believe that the range of company-sponsored programs we offer, our ability to leverage Forge Markets, and 12 years worth of private company trading data make us an attractive solution for private companies looking for liquidity solutions. Additionally, our ability to develop auction-based technology to support market pricing for company liquidity programs, and the open cap table approach we embrace has the potential to drive incredible value for our business. Powerful Network Effect Afforded Through Our Four Pillars Forge is building the needed technology infrastructure to power the private markets and providing the liquidity, access, and transparency that ecosystem participants need and want. Our platform is built to enable more than just trading; we are bringing together a robust set of complementary businesses along with a coalition of partners that together delivers a comprehensive solution empowering the private market ecosystem at scale. In addition to leveraging Forge s relationships with over 447,000 individual investors and 1,223 institutional investors (each as of December 31, 2021), Forge s platform benefits from a unique distribution network that includes strategic investors and commercial partners that have strong relationships with private companies and investors. Forge has the opportunity to benefit from these partnerships through introductions to private companies, shareholders, and the buy-side demand delivered by strategic investors and commercial partners. Our strategic investors include, among others, public market exchange Deutsche B rse, large global banks Wells Fargo and BNP Paribas, and asset manager Temasek. We have entered into referral, collaborative marketing or API/website linking arrangements with BNP Paribas, wealth manager Addepar and cap table companies Certent and AST Private Company Solutions, with respect to its Astrella platform, pursuant to which we have agreed to promote each other s services to each other s clients or otherwise collaborate through marketing, referrals and/or technological integrations. We re building a future where sellers on Forge Markets become buyers. Buyers become custody account holders at Forge Trust. Account holders borrow against their assets to buy more stock. Companies use Forge Company Solutions to offer liquidity to employees. Every step along the way generates information that is captured and provides transparency to market participants through 61 Table of Contents Forge Data. We believe that these complementary product offerings result in the opportunity for growth in one pillar to accelerate the growth of the others, increasing client engagement and enhancing the Forge brand. The combination of Forge Markets, Forge Trust, Forge Company Solutions and Forge Data provides private markets clients with the critical ecosystem and technology they need to execute transactions and securely hold their non-liquid assets. In providing clients an end-to-end solution, Forge has a clearly differentiated value proposition in the market. Our Growth Strategy We believe the private market has an unmet need for the technology we have built. We expect to leverage our platform to continue to drive growth in the following areas: Additional Scale in Our Four Pillars. We will continue to invest and scale our Forge Markets, Forge Trust, Forge Company Solutions and Forge Data businesses and build our client and investor networks. New Products. We will continue to build and add new products in support of, or in addition to our existing four pillars. Additional Partnerships. We are building strong relationships with partners that we can work with to create improved technologies and help distribute our products and services. International Expansion. We may in the future expand our operations in Asia and/or Europe in order to match the global demand for our products and services. While we are continually evaluating international market expansion opportunities, we currently have no definitive plans with respect to specific international markets, timing or estimated costs of such expansion. Issuers, buyers and sellers from over sixty jurisdictions have transacted on our platform. The majority of our revenues are derived from transactions involving U.S. issuers. Our operations are located in the United States. We have a local branch office in Hong Kong. Our subsidiary, SharesPost Asia Pte Ltd., holds a Recognized Market Operator license with the Monetary Authority of Singapore; however, it currently does not engage in any business activities. See Risk Factors Regulatory, Tax and Legal Risks We have expanded and may continue to expand into international markets, which expose us to significant new risks, and our international expansion efforts may not be successful. New Asset Classes. We will continue to explore other non-liquid asset classes that have significant investor demand. Inorganic Opportunities. We will focus on value-generating M&A, drawing on our track record of integrating previous acquisitions. Our Competitive Strengths We have built a market-leading financial technology platform to digitize a complex and historically analog process and, in the process, changed the landscape of private market investing for companies, employees and individual and institutional clients. We believe we are well-positioned to serve an increasing portion of the broader financial services ecosystem. Solely Focused on the Private Market Since inception, we have built world-class technology and invested heavily in an organization focused solely on facilitating private market transactions. This proprietary technology and operating expertise is supported by standard documentation and efficient workflows which makes the processing of trades an efficient and user-friendly experience. Amassing the technical expertise and know-how to perform these tasks at scale across both direct and SPV trades is difficult, and we believe we are uniquely positioned as we continue to automate large parts of this traditionally offline process. Complimentary and Integrated Strategy Powered by Four Pillars We strategically built our business model around Forge Markets, Forge Trust, Forge Company Solutions, and Forge Data to deliver a robust set of products and services that provide a better customer experience, synergies across the four business units, and strong user economics. We believe over time customers will increasingly look to end-to-end technology providers that can provide a holistic approach to their private market needs. The investments we made will enable us to quickly introduce new products and services while also providing us the opportunity to quickly and profitably continue to scale. 62 Table of Contents Leading Technology Platform in the Private Markets Operating at Scale We believe that Forge Markets is the leading private market trading platform based on number of transactions processed. Since Forge s inception, together with the historical business and companies we have acquired, as of December 31, 2021, we have facilitated over $12 billion in transaction volume across more than 21,000 transactions and more than 450 companies. The product design and underlying technology of our platform make matching and closing of private market transactions easier and faster. We continually seek client feedback and invest resources to improve the user experience, accelerate liquidity, and attract new clients on the platform. Robust Technology and Creative Product Design We believe participation in the private markets at scale can only happen by actively engaging with, and providing access to, a larger portion of the population through intuitive user-friendly technology and products. We put automation and design at the center of our products with the goal of making the user experience as easy and enjoyable as possible. We involve our talented product designers early and often throughout our product development process to create elegant experiences that solve the private markets biggest pain points and address our customers largest needs. Compelling Business Model Our user-friendly platform has enabled thousands of clients to access the private markets while modernizing the way shares of private companies get traded. Our unique value proposition and high repeat and engagement rates have delivered rapid growth despite limited marketing spend. Our attractive cohort economics should improve over time as our customers deepen their engagement and relationship with Forge. Diverse and Experienced Team We have assembled a deep and experienced leadership team that includes senior executives from innovative technology companies, marquee and top-tier financial firms, leading public market exchanges, and globally recognized asset managers. We operate as one team, leveraging our collective expertise, particularly in technology and product development, to enhance and expand our operations. We are also proud and fortunate to have talented and passionate employees that are bold, humble, and accountable and a culture that puts trust, transparency and collaboration top-of-mind. Marketing Our marketing strategy creates enterprise value by building our brand, attracting, engaging, converting and retaining clients, and delivering compelling content and experiences that help people accelerate their destiny and financial goals. We believe that our brand is the collection of every experience a person has with our company over time and we strive to deliver on our brand promise to our customers, our partners, and our employees each and every day. As such, we know that marketing serves as our voice to customers and the source of unification across the end-to-end customer journey. Our focus is to amplify Forge s position as the experts in the private markets and to develop customer experiences that reinforce that position. We approach customer engagement and acquisition across a combination of owned, earned, and paid channels including: A robust content strategy and search engine optimization ( SEO) that drives organic customer awareness and engagement PR and social media that amplifies our messages and drives qualified customers to us directly Paid channels including paid search, digital acquisition, and sponsorships to target prospective customers across their journey Partner co-marketing where we can go to market with a value proposition that is compelling to our partners customers 63 Table of Contents We believe we have built a highly effective and efficient approach to new customer engagement and lead acquisition, with SEO and direct-to-site traffic driving over 50% of our new leads on a quarterly basis in the first half of calendar year 2021. We are building the infrastructure to unlock targeted and addressable ads to these customers and prospects, based on where they are in their relationship journey with us. Competition We compete with individual brokers and companies that provide access to private market trading, custody services, data packages and other private market capital solutions. Competitors within these four pillars include other online private shares marketplaces and offline brokers, global banks, custodial service providers, and subscription-based data providers (including data divisions of large stock exchanges). We believe we are highly differentiated relative to our competition as a result of having all four pillars under the same business, a coalition of strategic and commercial partners that includes exchanges, global banks, cap table companies and asset managers as well as existing scale where volume begets volume creating an inflection point that accelerates market adoption for our products. Culture and Employees At Forge, we believe that our people are our greatest asset. We welcome people from all backgrounds and foster a culture where everyone can show up as their whole self each day. Our culture is built around a spirit of fun, friendship and community. We care for and respect each other, and embrace diversity by celebrating different perspectives, skills and experiences. Employee Experience Our priority is to promote a sense of belonging and community through our fun and compelling work environment. We cultivate community and collaboration through an excellent employee experience. By providing transparency through continuous, high-impact communication, we strive to ensure that employees understand what we do, how the organization works, and how their work impacts the greater goals of the organization. Forge has established a Culture Committee consisting of representatives across the organization with the purpose of promoting a unified culture, ensuring inclusion, and participation of all employees. Objectives and goals of the Culture Committee include awareness, promotion, and modeling of values; cross divisional trust and collaboration with supporting dialogue; employee engagement and satisfaction; and consistency across divisions through communication, culture-supportive training and leadership. We also have several employee resource groups that meet regularly, providing opportunities for employees to connect over shared interests and activities; senior executives regularly attend these meetings and get to know our growing employee base. Career Opportunities Forge offers unique career development and growth opportunities in our fast-paced, high-growth environment. Everyone is an innovator at Forge we seek ideas and inspiration from all teams and levels across the organization. We support innovation and encourage entrepreneurship as we forge connections and relationships, creating an enriched future for all. Health, Wellness, & Total Rewards Our goal is to help our employees thrive by supporting where they are in their lives through competitive compensation and rich benefits offerings. Our compensation programs are designed to attract, retain, and motivate employees who are highly skilled in their roles and share in our vision and values of being bold, accountable, and humble. In addition to traditional benefits, we offer employee rewards and recognition programs to recognize and celebrate excellent work that aligns with our core company values. We provide continuous recognition of employee milestones, wins and hard work. 64 Table of Contents Values We are driven by our shared values and put team before self. We are: Bold: Innovate by delivering new ideas and solutions. We have the courage to take risks and push past our comfort zone while respectfully challenging ideas. We redefine failures as learning opportunities. Accountable: Debate, commit, take ownership, and support the team. Once the direction has been determined, we work as a team by going beyond personal responsibilities to deliver results. Humble: Exemplify excellence without arrogance. We focus on collective success through collaboration while practicing empathy to support the team. We listen with openness and seek to understand before being understood. Diversity & Inclusion Diversity is about our people, geography, and partners. We strive to build a globally inclusive culture and diverse organization. Inclusion is about our connections. We aim to build skills that nurture respectful conversations, create deeper human connections, and encourage diverse interactions. The purpose of our Diversity & Inclusion program is advocacy for underrepresented groups, community service, and workplace wellness; ensure all employees have the opportunity to be heard, valued, and engaged; and to share ideas, drive results, forge relationships, and ensure alignment between business and diversity strategies. To support a culture of belonging, Forge provides foundational training for a framework of communications including Crucial Conversations, Change Management, and quarterly Diversity, Equity & Inclusion trainings such as Emotional Intelligence and Empathy and Unconscious Bias. Our Diversity & Inclusion programs continue to grow and evolve, just as we do as a team. Through our Diversity & Inclusion programs, we seek to uplift coworkers and communities as we work with teammates across the organization to get involved and give back to the community. Facilities Our headquarters are located in San Francisco, California, where we occupy facilities totaling approximately 24,000 square feet under lease agreements that expire in 2023. We have other offices, including San Carlos, CA, Sioux Falls, SD, New York, NY, and Hong Kong totaling a combined 22,000 square feet. These offices are leased, and we do not own any real property. Our facilities are adequate to meet our needs for the immediate future, but we are actively seeking additional physical office space to accommodate expansion of our operations. Government Regulation We operate in a rapidly evolving regulatory environment and are subject to extensive and complex regulations. Any actual or perceived failure to comply with these requirements may result in, among other things, revocation of required licenses or registrations, loss of approved status, regulatory or governmental investigations, administrative enforcement actions, sanctions (including monetary penalties, civil and criminal liability, litigation, reputational harm, or constraints on our ability to operate. We could be subject to additional legal and regulatory requirements if laws and regulations change in the jurisdictions we operate. 65 Table of Contents U.S. Regulation U.S. federal and state securities laws establish a system of regulation of securities, custody, and lending markets in which we operate. This regulatory framework applies to our U.S. businesses in the following ways: regulation of our broker-dealer and registered investment advisor subsidiaries; regulation of our South Dakota chartered non-depository licensed trust company; and regulation of our California licensed lending subsidiary. Broker Dealer Regulation. Our broker-dealer subsidiary, Forge Securities LLC, is subject to regulation by the SEC, the Financial Industry Regulatory Authority ( FINRA ), and regulators in all U.S. states, Washington, DC, Puerto Rico, and the U.S. Virgin Islands. FINRA is a self-regulatory organization that oversees and regulates Forge Securities in addition to oversight and regulation by the SEC. Forge Securities also operates an SEC-regulated alternative trading system that facilitates the purchase and sale of primary issuances and secondary transactions in unregistered securities, typically in reliance on Rule 506 of Regulation D under the Securities Act. Forge Securities is subject to the Bank Secrecy Act, as amended by the USA PATRIOT Act, the regulations promulgated by the Financial Crimes Enforcement Network ( FinCEN ), as well as the economic and trade sanction programs administered by the U.S. Department of Treasury s Office of Foreign Assets Control ( OFAC ). Investment Advisor Regulation. Our investment adviser subsidiary, Forge Global Advisors LLC ( FGA ), is federally registered and subject to regulation by the SEC under the Investment Advisers Act of 1940 (the Advisers Act ). FGA provides portfolio management for pooled investment vehicles that are not registered under the Investment Company Act of 1940. The Advisers Act imposes duties and restrictions on FGA, including requirements relating to the safekeeping of client funds and securities, prohibitions of fraudulent activities, disclosure and reporting obligations, and fiduciary duty obligations. Trust Regulation. Our state-chartered non-depository trust company subsidiary, Forge Trust Co., is subject to regulation and examination by South Dakota Division of Banking. Forge Trust Co. provides individual investors custodial services for self-directed Traditional Individual Retirement Accounts, Roth Individual Retirement Accounts, SIMPLE Accounts, SEP Accounts, and Coverdell Education Savings Accounts, as well as Inherited IRAs, Individual Solo 401k plans, Private Fund Custody, and safekeeping. Forge Trust is also subject to Bank Secrecy Act, as amended by the USA PATRIOT Act, the regulations promulgated by FinCEN, as well as the economic and trade sanction programs administered by OFAC. Lending Regulation. SharesPost Securities, LLC ( SPS ), our licensed lender with the State of California, is subject to regulation and examination by the Department of Financial Protection and Innovation pursuant to the California Finance Lending Laws. SPS is engaged in the business of originating nonrecourse loans that contain limited security interest in a borrower s unregistered private company securities. Asia-Pacific Regulation Our Singapore-based subsidiary, SharesPost Asia Pte. Ltd. ( SP-Asia ) is subject to regulation by the Monetary Authority of Singapore ( MAS ) under the Securities and Futures Act (Cap. 289), the Securities and Futures (Organized Markets) Regulations 2018, and any directives issued by the MAS from time to time, including those pertaining to the prevention of money laundering and countering the financing of terrorism. SP-Asia is approved as a Recognized Market Operator that facilitates the purchase and sale of secondary transactions in unregistered securities. Forge Securities operates under a distribution and outsourcing agreement (the Outsourcing Agreement ) with Rockpool Capital Limited ( Rockpool ), an existing Type 1 license holder under the rules and regulations of the Securities and Futures Commission of Hong Kong (the SFC ). Rockpool is authorized to do Type 1 business (as set forth under the rules and regulations of the SFC) and Forge partners with Rockpool, as permitted by SFC regulations. Forge maintains a separate onboarding process for Hong Kong clients to ensure that Forge s U.S. business is not actively marketing services to Hong Kong persons. Pursuant to the Outsourcing Agreement, Forge appointed Rockpool as a non-exclusive distributor in Hong Kong of securities offered on the Forge platform, and Forge agreed to secondee certain employees from time to time. Forge agreed to pay Rockpool a de minimis monthly fee, and the parties agreed to negotiate fees for any brokered transactions on a case-by-case basis. A Type 1 License is required to deal in securities in Hong Kong. 66 Table of Contents Data Privacy Our businesses collect, store, share, transfer, use and otherwise process the personal data of individuals worldwide. Laws and regulations such as the European Union General Data Protection Regulation and the California Consumer Privacy Act impose stringent data protection requirements on our businesses and grants residents in the European Union and California various rights with regard to personal information relating to them, including the right to request disclosure of the categories and specific pieces of personal information collected by our businesses and the right to request erasure of such personal information. Intellectual Property At Forge we rely primarily on trade secret, copyright, and trademark law to protect our proprietary intellectual property in the United States and foreign jurisdictions. Because federal, state, and common law rights provide only limited protection for intellectual property, we employ a strict policy of requiring non-disclosure agreements and intellectual property protections in our vendor and licensing agreements, including feedback assignments and work-for-hire provisions. As an example, Forge s licensing agreement for its Forge Intelligence Platform-as-a-Service (PaaS) product features strong confidentiality and intellectual property protections. Further, users of Forge s websites and online marketplaces all accept the terms of service that clearly identify content owned and controlled by Forge. Forge has always emphasized innovation in its online marketplaces. We have seven active applications for patents in the United States and EU. Legal Proceedings From time to time, we are involved in various legal proceedings arising from the normal course of business activities. Defending such proceedings is costly and can impose a significant burden on management and employees. The results of any current or future litigation cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors. On January 7, 2022, Erika McKiernan, in her capacity as Stockholder Representative for the former stockholders of SharesPost filed a lawsuit against Forge in the Court of Chancery of the State of Delaware, asserting claims in connection with the Agreement and Plan of Merger, dated as of May 10, 2020, by and among Forge, SharesPost, Thanksgiving Merger Sub, Inc., and Erika McKiernan as the Stockholder Representative, as amended on November 6, 2020 (the SharesPost Merger Agreement ). In general, the complaint asserts breaches of the SharesPost Merger Agreement and seeks declaratory judgments establishing those breaches. The complaint includes but is not limited to the following material allegations: (i) Forge breached the SharesPost Merger Agreement by failing to issue and deliver the warrants contemplated therein (the Buyer Warrants ) in a form that Stockholder Representative claims that the parties agreed, but which is not the form reflected in the SharesPost Merger Agreement; (ii) Forge should be compelled to issue and deliver the Buyer Warrants in the form Stockholder Representative claims the parties agreed; (iii) Forge s alleged breaches of the SharesPost Merger Agreement have caused Stockholder Representative and the former stockholders of SharesPost to suffer losses which Forge must indemnify under the terms of the SharesPost Merger Agreement, and that Forge has further breached the SharesPost Merger Agreement by failing to do so; and (iv) the losses that Stockholder Representative and other indemnified parties have suffered and will suffer as a result of Forge s alleged breaches are indemnifiable under the SharesPost Merger Agreement. Forge answered the complaint on February 17, 2022, denying it committed any breaches of the SharesPost Merger Agreement and that Stockholder Representative is entitled to the requested relief. Additionally, on the same date, Forge filed a counterclaim against Stockholder Representative seeking a declaratory judgment that the form of Buyer Warrants attached to the SharesPost Merger Agreement is the operative form to which the parties agreed. Stockholder representative responded to that counterclaim on March 9, 2022, contesting that Forge is entitled to such a declaration. At this juncture we do not believe this action will have a material adverse impact on our operations or financial position. We believe the allegations set forth in this action are without merit and we intend to defend vigorously against the lawsuit. We are also the subject of various actions, inquiries, investigations, and proceedings by regulatory and other governmental agencies. We intend to cooperate fully with such investigations. We are not presently a party to any other legal or regulatory proceedings that in the opinion of our management, if determined adversely to us, would individually or taken together have a material adverse effect on our business, operating results, financial condition, or cash flows. 67 Table of Contents MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following discussion and analysis provide information that our management believes is relevant to an assessment and understanding of our consolidated results of operations and financial condition. This discussion and analysis should be read together with the unaudited condensed consolidated financial statements and related notes to those statements and audited consolidated financial statements and related notes to those statements included in this prospectus. This discussion and analysis contains forward-looking statements based upon current expectations that involve risks, uncertainties and assumptions, as described under the heading Forward-Looking Statements. Actual results and timing of selected events may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth under Risk Factors or elsewhere in this prospectus. Unless the context otherwise requires, references in this section to Forge, the Company we, us, and our , refer to Forge Global Holdings, Inc. and its subsidiaries following the Business Combination (as defined below). Business Overview Forge is a financial services platform headquartered in San Francisco, California. We have built a trusted marketplace to serve the unique needs of the private market by making purchases and sales of equity in private companies simple, transparent, and highly efficient to scale. Today, we are a leading provider for end-to-end enabling technology, data, and services for the private market. We operate as one business, a fully integrated private markets service provider. Since inception, we have added complementary pillars to provide the access, transparency and solutions that companies, as well as institutional and individual investors and shareholders, need to confidently navigate and efficiently transact in the private market. The four pillars that make up our business are: Forge Markets Our online trading platform that connects potential investors with private company shareholders and enables them to efficiently facilitate private share transactions. Forge Trust Our non-depository trust company that enables clients to securely custody and manage non-liquid assets through a robust and user-friendly online portal. Forge Data Our data business provides market participants the information and insight to confidently navigate, analyze, and make investment decisions in the private market. Forge Company Solutions (FCS) Our software solution purpose built for private companies to easily administer primary and secondary financing events. Recent Developments Consummation of Business Combination On March 21, 2022 (the Closing Date ), we consummated our business combination pursuant to the terms of the Agreement and Plan of Merger, dated September 13, 2021 (the Merger Agreement ), by and among Motive Capital Corp, a blank check company incorporated as a Cayman Islands exempted company in 2020 ( Motive ), FGI Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Motive ( Merger Sub ), and Forge Global, Inc., a Delaware corporation ( Legacy Forge ). Pursuant to the Merger Agreement, on the Closing Date, immediately prior to the consummation of the Business Combination (as defined below), Motive changed its jurisdiction of incorporation from the Cayman Islands to the State of Delaware and changed its corporate name to Forge Global Holdings, Inc. (the Domestication ). On the Closing Date, Merger Sub merged with and into Legacy Forge (the Merger ), with Legacy Forge surviving the Merger as a direct, wholly owned subsidiary of the Company (together with the Merger, the Domestication, and the other transactions contemplated by the Merger Agreement, the Business Combination ). Prior to the Business Combination, Motive s units, public shares, and Public Warrants were listed on the New York Stock Exchange under the symbols MOTV-UN , MOTV , and MOTV-WT , respectively. Following the consummation of the Business Combination, on March 21, 2022, the Company s common stock and Public Warrants began trading on The New York Stock Exchange ( NYSE ), under the symbols FRGE and FRGE WS , respectively. 68 Table of Contents Legacy Forge is considered the Company s accounting predecessor. The Merger was accounted for as a reverse recapitalization with Legacy Forge as the accounting acquirer and Motive as the acquired company for accounting purposes. Accordingly, all historical financial information presented in the unaudited condensed consolidated financial statements represents the accounts of Legacy Forge. Development of Forge Company Solutions (FCS) and Launch of Forge Intelligence FCS, launched in the first quarter of 2021, is a comprehensive software solution supported by private market experts. FCS supports companies running financing processes and seeks, through our automation and online technologies, to reduce the administrative burden that companies incur in doing so. FCS provides companies with oversight and control of company share transactions, including primary financings and company sponsored secondary programs, block trades, tender programs and Pre-Direct Listing trading. We offer flexible, customizable solutions to match a company s liquidity needs. Our first data product, Forge Intelligence, serves the needs of institutional investors that are looking for timely and accurate data to help them make more informed investment decisions in the private market. Annual subscriptions purchased by clients enable access to view and analyze historical bid/ask, share price, and volume information of the companies that have transacted on Forge Markets. Subscribers also have access to company waterfall charts, which can be used to easily analyze the share price impact of different exit scenarios, whether via M&A or IPO. Other data points include preferred equity conversion ratios and protective provisions such as liquidation preferences. Forge Intelligence is expected to provide a recurring, predictable revenue stream driven by the subscription access model. Subscribers commit to access on an annual basis, with cost scaling by feature offerings and number of seats, or individual users, required. Forge Intelligence represents a high-margin product at scale, given the low incremental cost of serving each additional subscriber. Additional data-oriented products are planned to follow from the Forge Data pillar in the future. In addition to the revenue Forge expects to generate through the data business, we believe that information provided to subscribers will also drive volume on Forge Markets, resulting in additional trading volume and revenue. We formally announced the launch of Forge Intelligence and accelerated our sales and marketing strategy in September 2021, having already converted some of our beta test users into fee-paying customers. In January 2022, we won our first customer for a new data feed product which provides institutional investors with access to Forge s historical proprietary data. We continue to sign up new customers while investing in our sales, marketing and technology. COVID-19 Impacts On March 11, 2020, the World Health Organization designated the novel coronavirus ( COVID-19 ) as a global pandemic. In an effort to manage the spread of the virus, federal, state and local governments enacted various restrictions, including closing schools and businesses, limiting or restricting social or public gatherings, implementing travel restrictions, and mandating stay-at-home orders, which have since been lifted to varying degrees across the country. The global economic situation was greatly affected by the spread of COVID-19 and the pandemic that followed, which continues to this day. In response to these developments, we took precautionary measures to ensure the safety of our employees, support our customers, and mitigate the impact on our financial position and operations. We implemented remote working capabilities for our entire organization with minimal disruption to our operations or key operating performance indicators. We also identified opportunistic expense reductions which increased operating efficiencies and provided additional profitability in the period. Although we have not experienced significant business disruptions thus far from the COVID-19 pandemic, we are unable to predict the full impact that COVID-19 and its variant strains will have on our future results of operations, liquidity and financial condition due to numerous uncertainties, including the duration of the pandemic, the actions that may be taken by government authorities across the United States, the impact to our customers, employees, suppliers, and other factors. These factors are beyond our knowledge and control and, as a result, at this time, we are unable to predict the ultimate impact, both in terms of severity and duration, that the COVID-19 pandemic will have on our business, operating results, cash flows and financial condition. While as of the date of this prospectus, the extent to which COVID-19 may impact the future financial condition or results of operations is still uncertain, we are not aware of any specific event or circumstance that would require revisions to estimates, updates to judgments, or adjustments to the carrying value of assets or liabilities. These estimates may change as new events occur and additional information is obtained. 69 Table of Contents Russia and Ukraine Conflict The military conflict in Russia and Ukraine that began in February 2022 continues as of the date of this prospectus. As the conflict continues to evolve, we are closely monitoring the impact on our business. The conflict, and the sanctions and counter-sanctions imposed in response to it, have created increased economic uncertainty and operational complexity globally. While we have no direct exposure to Russia and Ukraine, and do not at the moment believe the situation will have a material impact our operating results, we are monitoring any broader economic impact from the situation. Should the conflict continue or escalate, it could have a significant negative effect on the global economy or on our operations, including continued global inflationary pressures, supply chain and logistics disruptions, volatility in foreign exchange rates and interest rates, and heightened cybersecurity threats. Segment information We operate as one business, a fully integrated private markets service provider. Our chief operating decision maker is our Chief Executive Officer, who reviews financial information presented on a consolidated basis for purposes of making operating decisions, assessing financial performance, allocating resources and evaluating our financial performance. Accordingly, we have concluded that we consist of a single operating segment and reportable segment for accounting and financial reporting purposes. Key factors affecting our performance The key factors affecting our performance described below are not the only ones applicable to us. We believe that the growth of our business and our future success are dependent upon a number of key factors, including the following: Growing our Customer Base Sustaining our growth requires continued adoption of our platform by new customers and increased usage by current customers. We plan to continue to introduce products and features to attract and retain current and new customers, and we plan to seek to increase brand awareness and customer adoption of our platform through digital and broad-scale advertising. The circumstances that have accelerated the growth of our customer base in recent periods may not continue in the future. Expanding our Relationship with Existing Customers Our revenue has grown historically as we have introduced new products and features to our customers and as our customers have increased their usage of our platform. However, certain circumstances that have accelerated the growth of our business may not continue in the future. We aim to grow with our customers over time and to grow our relationship with our customers as they build and manage their wealth. In the future, our Forge Markets customers can become our Forge Trust customers as they increase their frequency and volume of trading on our platform, and cross over to opening custody accounts. These customers would also generate significant amounts of new data that is then monetized into our Forge Data offerings, which in turn, creates additional opportunity for us to convert existing trading and custodian customers into data subscribers. Vice versa, our customers that start initially as data subscription customers can find value in our custodial and trading offerings and become customers of all three offerings. Our ability to expand our relationship with our customers will be an important contributor to our long-term growth. Investing in our Platform We intend to continue to invest in our platform capabilities and regulatory and compliance functions to support new and existing customers and products that we believe will drive our growth. As our customer base and platform functionalities expand, areas of investment priority include product innovation, automation, technology and infrastructure improvements and customer support. We believe these investments will contribute to our long-term growth. Additionally, we strive to strengthen our relationships with our customers by responding to customer feedback not only through the introduction of new products, but also through improvements to our existing products and services. In recent years, there has been an upward trend in the valuation of venture backed companies, as well as an increase in the number and market capitalization of unicorn companies (private companies with a valuation over $1 billion). These trends drive an increase in the demand for services like Forge s that allow for buying and selling of private shares. We expect to increase the headcount number for our product, design, engineering, compliance, marketing, customer support and other teams to develop these capabilities and drive growth and deliver efficient support of a larger customer base for our business. 70 Table of Contents Private Market Trends Our results of operations are impacted by the overall health of the economy, and consumer and institutional investing patterns, which include the following key drivers: Market Trends. As private market investing continues and the number of venture-backed companies and unicorns increases, and companies stay private longer, our supply and demand will fluctuate accordingly. According to CB Insights, there are more than 1,000 unicorns as of May 2022, worth a combined $3.7 trillion. According to Pitchbook, in the three months ended March 31, 2022, U.S. venture capital firms collected more than $70 billion in commitments, which is expected to be deployed in the next few years. Technology companies waited a median of 12 years to go public as of 2020, compared to four years in 1999, at a median valuation of $4.3 billion compared to $493.0 million, according to a study published in March 2021 by Jay Ritter. Consequently, there are more shareholders (employees and early investors) looking for liquidity, and more investors interested in obtaining equity in these companies prior to going public. In addition, as the public financial markets grow and contract, our customers investing, saving, and spending behaviors are affected. Although our operating history has coincided with a period of general macroeconomic growth in the United States, particularly in the U.S. equity markets, which has previously stimulated growth in overall investment activity on our platform, we may be impacted by any slowdowns in growth or downturns and volatility in the U.S. equity markets. Consumer Behavior. Consumer behavior, whether from buyers or sellers, varies over time and is affected by numerous conditions. For example, behavior may be impacted by social or economic factors such as changes in disposable income levels and the need for liquidity, employee tenure at a venture-backed firm, general interest in investing, interest rate levels, and reaction to stock market volatility. There may also be high profile initial public offerings, or idiosyncratic events impacting single companies, that impact consumer behavior. These shifts in consumer behavior may influence interest in our products over time. Macroeconomic Events. Customer and business behavior is impacted by the overall macroeconomic environment, which is influenced by events such as the ongoing COVID-19 pandemic (including the COVID-19 vaccine development and responsive measures taken by the U.S. government), global supply chain disruptions, rising inflation, and the recent Russian invasion of Ukraine, as well as its effects on both global business and individuals behavior. Since the onset of the COVID-19 pandemic in March 2020, we have seen substantial growth in our customer base, retention, engagement and trading activity metrics. It is uncertain whether these trends and behavioral shifts will continue as reopening measures continue, and we may not be able to maintain the customer base we gained, or the rate of growth in our customer base that we experienced, throughout the COVID-19 pandemic. In addition, the COVID-19 pandemic has caused significant global supply chain disruptions, both domestically and globally, contributing to the rapidly rising inflation and increased market volatility. The Federal Reserve s recent increase of the interest rates as one of the key measures for containing the rising inflation had a further economic effect resulting in slower has further slowed economic growth and increased public and private market uncertainties. The recent Russian invasion of Ukraine has also contributed to a rise in energy and commodity prices and further contributed to the deterioration of global and regional economies. While these circumstances continue to evolve, and the outcomes remain highly uncertain, there is a risk that such events might have an unfavorable impact on behavior of our customers, including changes in their investment preferences. Key Personnel Our future success depends, in large part, upon our ability to attract and retain highly qualified and skilled professional personnel that can learn and embrace new technologies. Competition for key personnel in the various localities and business segments in which we operate is intense. Our ability to attract and retain key personnel, in particular senior officers or technology personnel, will be dependent on a number of factors, including prevailing market conditions, office/remote working arrangements and compensation packages offered by companies competing for the same talent. There is no guarantee that we will have the continued service of key employees whom we rely upon to execute our business strategy and identify and pursue strategic opportunities and initiatives. In particular, we may have to incur costs to replace senior officers or other key employees who leave, and our ability to execute our business strategy could be impaired if we are unable to replace such persons in a timely manner. Custodial administration fees We generate revenues primarily through fees for performing custodial account administrative and maintenance services for our customers, including quarterly or monthly account fees, asset fees, and transaction fees. We assess a flat fee per account, with 71 Table of Contents additional fees based on the number and types of assets held and services purchased by account holders. We also receive cash administration fees for facilitating customers transactions with Federal Deposit Insurance Corporation banks, with fees contingent on prevailing interest rates and cash balances in custodial accounts. Our revenues depend on the number of Total Custodial Accounts, which include accounts clients open directly with us and the activity within these accounts as well as accounts we custody on behalf of partners. Our business depends on maintaining and growing the number of Total Custodial Accounts. Types of Structures We have facilitated direct trades, trades in both our own special purpose vehicles ( SPVs ) and other firms funds, and certain forward agreements. We may adjust placement fees to account for the operational costs of these transaction types, and we incur certain transaction-based costs depending on the structure. The mix of trades of different structures will impact our overall take rate and revenues. Types of Buyers/Sellers The type of client may influence our placement fee revenue. Examples of a type of client are institutional and individual clients, who may receive various placement fee rates depending on different factors. Having clients that come to our platform through external brokers or Forge Company Solutions programs may also impact our placement fee revenue. The mix of clients in any given period will impact our overall take rate and revenues. Use of External Brokers and Referral Partners When working with an external broker or partner, we share a portion of the placement fees, which are recognized in our consolidated financials under transaction-based expenses. The mix of fees paid to external brokers and partners fluctuates each time period, which we expect to continue based on our growth in the private market and the size of our order book, our growing partnerships, and the growth of the market overall Future resales of our common stock being offered in this prospectus by our shareholders The shares of common stock being offered for resale in this prospectus represent approximately 58% of our total outstanding shares of common stock as of the date of this prospectus. Additionally, if all the warrants, assumed warrants and Former Employee Options are exercised, the holders of such warrants, assumed warrants and Former Employee Options would own an additional 28,858,897 shares of common stock, representing approximately 64% of our total shares of common stock outstanding following such exercise. The Selling Securityholders, which include Paul Luc Robert Heyvaert and entities affiliated with Motive Partners and Deutsche Borse AG (who collectively own over one-third of our outstanding shares), will be able to sell their shares of common stock for so long as the registration statement, of which this prospectus forms a part, is available for use or pursuant to an exemption from registration under the Securities Act and any applicable lock-up restrictions expire. The market price of our shares of common stock could decline if the Selling Securityholders sell a significant portion of our shares of common stock or are perceived by the market as intending to sell them. For more information, see Risk Factors Substantial future sales of shares of our shares of common stock could cause the market price of our shares of common stock to decline. Key Business Metrics We monitor the following key business metrics to help us evaluate our business, identify trends affecting our business, formulate business plans and make strategic decisions. The tables below reflect period-over-period changes in our key business metrics, along with the percentage change between such periods. Our trading business, comprised of Forge Markets offering, is presented for the 72 Table of Contents periods presented, while our custody business, comprised of Forge Custody offering, presents data as of the dates presented. We believe the following business metrics are useful in evaluating our business: Three Months Ended March 31, Year Ended December 31, Dollars in thousands 2022 2021 Change % Change 2021 2020 Change % Change TRADING BUSINESS Trades 596 1,514 (918) (61) % 4,890 1,779 3,111 175 % Volume $ 417,961 $ 757,851 $ (339,890) (45) % $ 3,180,257 $ 1,151,028 $ 2,029,229 176 % Net Take Rate 3.5 % 3.5 % % 3.3 % 2.2 % 1.1 % 50 % Placement fee revenues, less transaction-based expenses $ 14,453 $ 26,533 $ (12,080) (46) % $ 104,689 $ 25,352 $ 79,337 313 % As of March 31, As of December 31, Dollars in thousands 2022 2021 Change % Change 2021 2020 Change $Change CUSTODY BUSINESS Total Custodial Accounts 2,228,101 1,787,208 440,893 25 % 2,124,677 1,575,780 548,897 35 % Assets Under Custody $ 14,933,379 $ 13,827,501 $ 1,105,878 8 % $ 14,334,527 $ 13,282,809 $ 1,051,718 8 % Trades are defined as the total number of orders executed by the Company and acquired entities buying and selling private stocks on behalf of private investors and shareholders. Increasing the number of orders is critical to increasing our revenue and, in turn, to achieving profitability. Volume is defined as the total sales value for all securities traded on our Forge Markets platform. Volume is defined as the aggregate value of the issuer company s equity attributed to both the buyer and seller in a trade; the Company typically captures a commission on both sides, and as such a $100 trade of equity between buyer and seller would be captured as $200 volume for the Company. Volume is influenced by, among other things, the pricing and quality of our services as well as market conditions that affect private company valuations, such as increases in valuations of comparable companies at initial public offering. Net Take Rates are defined as our placement fee revenues, less transaction-based expenses (defined below), divided by Volume. These represent the percentage of fees earned by our marketplace on any transactions executed, which is a determining factor in our revenue. The Net Take Rate can vary based upon the service or product offering and is also affected by the average order size and transaction frequency. Total Custodial Accounts, previously called Billable Core and Platform Accounts, are defined as our customers custodial accounts that are established on our platform and billable. These relate to our Custodial Administration fees revenue stream and are an important measure of our business as the number of Total Custodial Accounts is an indicator of our future revenues from certain account maintenance, transaction, and sub-account fees. Assets Under Custody is the reported value of all client holdings held under our agreements, including cash submitted to us by the responsible party. These assets can be held at various financial institutions, issuers, and in our vault. As the custodian of the accounts, we collect all interest and dividends, handle all fees and transactions and any other considerations for the assets concerned. Our fees are earned from the overall maintenance activities of all assets and are not charged on the basis of the dollar value of Assets Under Custody, but we believe that Assets Under Custody is a useful metric for assessing the relative size and scope of our business. 73 Table of Contents Non-GAAP Financial Measures In addition to our financial results determined in accordance with generally accepted accounting principles in the United States of America ( GAAP ), we present Adjusted EBITDA, a non-GAAP financial measure. We use Adjusted EBITDA to evaluate our ongoing operations and for internal planning and forecasting purposes. We believe that Adjusted EBITDA, when taken together with the corresponding GAAP financial measure, provides meaningful supplemental information regarding our performance by excluding specific financial items that have less bearing on our core operating performance. We consider Adjusted EBITDA to be an important measure because it helps illustrate underlying trends in our business and our historical operating performance on a more consistent basis. However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. In addition, other companies, including companies in our industry, may calculate similarly titled non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of Adjusted EBITDA as a tool for comparison. A reconciliation is provided below for Adjusted EBITDA to net loss, the most directly comparable financial measure stated in accordance with GAAP. Investors are encouraged to review Adjusted EBITDA and the reconciliation of Adjusted EBITDA to net loss, and not to rely on any single financial measure to evaluate our business. We defined Adjusted EBITDA as net loss, adjusted to exclude: (i) interest expense, net, (ii) provision for or benefit from income taxes, (iii) depreciation and amortization, (iv) share-based compensation expense, (v) change in fair value of warrant liabilities, (vii) acquisition-related transaction costs, and (vi) other significant gains, losses, and expenses (such as impairments, transaction bonus) that we believe are not indicative of our ongoing results. The following table reconciles net loss to Adjusted EBITDA for the Company for the periods presented below (in thousands): Three Months Ended March 31, Year Ended December 31, 2022 2021 2021 2020 Net loss $ (64,424) $ 938 $ (18,499) $ (9,712) Add: Interest (income) expense, net (21) 554 2,307 2,405 Provision for (benefit from) income taxes 123 (8) 386 (803) Depreciation and amortization 1,082 1,396 5,390 2,406 Impairment of right-of-use assets 265 Share-based compensation expense 8,522 1,259 12,231 4,906 Change in fair value of warrant liabilities 25,959 908 6,064 292 Acquisition-related transaction costs(1) 3,706 882 3,289 Transaction bonus (2) 17,735 Adjusted EBITDA $ (7,053) $ 5,047 $ 8,761 $ 2,783 (1) Acquisition-related transaction costs include transaction costs related to the Business Combination, which consisted of legal, accounting, and other professional services directly related to the Merger, direct and incremental costs in connection with business acquisitions, which consist primarily of professional services fees for investment banking advisors, legal services, accounting advisory, and other external costs directly related to acquisitions and other strategic opportunities. (2) Represents a one-time transaction bonus to certain executives as a result of consummation of the Merger, included in the compensation and benefits in the condensed consolidated statements of operations and comprehensive (loss) income Some of the limitations of Adjusted EBITDA include: (i) Adjusted EBITDA does not properly reflect capital commitments to be paid in the future, and (ii) although depreciation and amortization are non-cash charges, the underlying assets may need to be replaced and Adjusted EBITDA does not reflect these capital expenditures. In evaluating Adjusted EBITDA, be aware that in the future we will incur expenses similar to the adjustments in this presentation. Our presentation of Adjusted EBITDA should not be construed as an inference that our future results will be unaffected by these expenses or any unusual or non-recurring items. We compensate for these limitations by providing specific information regarding the GAAP items excluded from Adjusted EBITDA. When evaluating our performance, consider Adjusted EBITDA in addition to, and not a substitute for, other financial performance measures, including our net loss and other GAAP results. 74 Table of Contents Basis of Presentation The consolidated financial statements and accompanying notes of the Company included elsewhere in this prospectus include our accounts and accounts of our consolidated subsidiaries and were prepared in accordance with GAAP. Components of Results of Operations Revenue We generate revenue from providing private market services, which include fees charged for private placements on our marketplace platform, and fees charged for account and asset management to customers. We categorize our services into the following three categories: Placement fees We maintain a trading platform which generates revenues through our Forge Markets offering with volume-based fees sourced from institutions, individual investors and private equity holders. Placement fees represent fees charged by us for executing a private placement on our platform. We earn agency placement fees in non-underwritten transactions, such as private placements of equity securities. We enter into arrangements with individual accredited customers or pooled investment vehicles to execute private placements in the secondary market. We anticipate placement fees to grow in the long run as the secondary market continues to grow and the Company continues to execute trades more efficiently. Custodial administration fees We generate revenues primarily through fees for performing custodial account administrative and maintenance services for our customers, including quarterly or monthly account fees, asset fees, and transaction fees. We assess a flat fee per account, with additional fees based on the number and types of assets held and services purchased by account holders. We also receive cash administration fees for facilitating customers transactions with Federal Deposit Insurance Corporation banks, with fees contingent on prevailing interest rates and cash balances in custodial accounts. Our revenues depend on the number of Total Custodial Accounts, which include accounts clients open directly with us and the activity within these accounts as well as accounts we custody on behalf of partners. Revenues from custodial administration fees are recognized either over time as underlying performance obligations are met and day-to-day maintenance activities are performed for custodial accounts, or at a point in time upon completion of transactions requested by custodial account holders. Subscription Fees We generate revenues through our Forge Data offerings with subscription fees earned from our first data product, Forge Intelligence, which we formally launched in September 2021, and through our Forge Company Solutions fees. We anticipate subscription fees to grow as we expand our sales and marketing efforts and develop more features and products. Subscription fees were not material for the periods presented and were included as part of placement fees in condensed consolidated statements of operations and comprehensive (loss) income. Transaction-based expenses Transaction-based expenses represent fees incurred to support placement activities. These include expenses for fund insurance, fund management, fund and trade settlement, external broker fees, and transfer fees. We generally expect these expenses to increase in absolute dollars as our placement fee revenue grows. Compensation and benefits Compensation and benefits expense is our most significant operating expense and includes employee wages, bonuses, share-based compensation, severance costs, benefits, and employer taxes. The bonus component of our compensation and benefits expense is based on both our financial performance and individual employee performance as well as transaction bonus related to the consummation of the Business Combination for certain employees. We expect our compensation and benefits expense to increase as our revenue grows and we hire additional personnel to continue developing new products and services and increase the functionality of our platform. In addition, the share-based compensation component of the compensation and benefits expense may or may not increase as we continue to align our headcount with current and future business needs. 75 Table of Contents Professional services Professional services expense includes fees for consulting services received on strategic and technology initiatives, temporary labor, as well as regulatory, legal and accounting fees. We expect to incur additional professional services expenses as we work to implement procedures and processes to address public company regulatory requirements and customary practices. Acquisition-related transaction costs Acquisition-related transaction costs consist primarily of professional services fees for investment banking advisors, legal services, accounting advisory, and other external costs directly related to acquisitions and other strategic opportunities. We expect to continue to explore and pursue various potential acquisitions and other strategic opportunities to strengthen our competitive position and support our growth. Acquisition-related transaction costs may be significant in relation to certain acquisitions, however, they are non-recurring in nature, as we identify and pursue targets for particular purposes as necessary. Acquisition-related transaction costs also include the costs related to the Business Combination, which consisted of legal, accounting, and other professional services directly related to the Business Combination. As a result, we may or may not incur acquisition-related transaction costs in future periods. Advertising and market development The largest component of our advertising and market development expense consists of our discretionary customer acquisition expenses as well as investments in building the Forge brand and in growth marketing in support of driving more awareness, engagement, and lifetime revenue from our target audiences. These include advertising, marketing data analysis, content development, trade shows, public relations, web development, and seminars and conferences. Marketing is an important driver of growth and we intend to continue to make significant investments in customer acquisition. We expect our advertising and market development expense to increase in absolute dollars for the foreseeable future as we continue to focus on customer acquisition efforts. Rent and occupancy Rent and occupancy expense is related to our leased property and includes rent, maintenance, real estate taxes, utilities, and other related costs. We generally expect our rent and occupancy expense to increase in absolute dollars as a result of our expansion efforts. Technology and communications Technology and communications consist of costs for our hosting fees paid to third-party data centers, software development engineers, and maintenance of our computer hardware and software required to support our technology and cybersecurity. Technology and communications also include costs for network connections for our electronic platforms and telecommunications. We generally expect our technology and communications expense to increase as we continue to increase our headcount and innovate on our offerings and services. General and administrative General and administrative includes insurance, bank service charges, dues and subscriptions, travel and entertainment, other general and administrative costs. We expect our general and administrative expense to increase in the near term as a result of operating as a public company, including regulatory fees associated with compliance with the rules and regulations of the SEC and other regulatory bodies, as well as increases in general office expenses as we grow our business. Depreciation and amortization Depreciation and amortization is attributable to property and equipment, intangible assets and capitalized internal-use software. We expect our depreciation and amortization expense to increase for the foreseeable future as we plan additional capital expenditures to support the growth of our business. 76 Table of Contents Interest income (expense), net Interest income (expense), net, primarily includes expenses related to our borrowing arrangements with financial institutions and issuance of convertible notes to investors for purposes of obtaining funding for operations. These expenses were offset by interest income from our cash and cash equivalents. Change in fair value of warrant liabilities Changes in the fair value of warrant liabilities, including Public Warrants and Private Placement Warrants, are related to warrant liabilities that are marked-to-market each reporting period with the change in fair value recorded in the accompanying consolidated statements of operations and comprehensive (loss) income until the warrants are exercised, expire or other facts and circumstances lead the warrant liabilities to be reclassified to stockholders equity or deficit. Other income, net Other income, net, includes loss on an equity method investment, and other non-operating income and expenditures. Results of Operations Comparisons for Three Months Ended March 31, 2022 and March 31, 2021 The following table sets forth our consolidated statement of operations for the three months ended March 31, 2022 and 2021, and the dollar and percentage change between the two periods (dollars in thousands): Three Months Ended March 31, 2022 2021 Change % Change Revenues Placement fees $ 14,585 $ 27,509 $ (12,924) (47) % Custodial administration fees 5,437 4,546 891 20 % Total revenues $ 20,022 $ 32,055 Transaction-based expenses: Transaction-based expenses (132) (976) 844 (86) % Total revenues, less transaction-based expenses $ 19,890 $ 31,079 Operating expenses: Compensation and benefits $ 43,640 $ 20,496 23,144 113 % Professional services 3,518 2,700 818 30 % Acquisition-related transaction costs 3,706 3,706 100 % Advertising and market development 1,504 987 517 52 % Rent and occupancy 1,566 887 679 77 % Technology and communications 2,023 1,434 589 41 % General and administrative 1,602 953 649 68 % Depreciation and amortization 1,082 1,396 (314) (22) % Total operating expenses $ 58,641 $ 28,853 Operating (loss) income $ (38,751) $ 2,226 Interest expenses and other income (expenses): Interest income (expense), net 21 (554) 575 (104) % Change in fair value of warrant liabilities (25,959) (908) (25,051) 2,759 % Other income, net 388 166 222 134 % Total interest expenses and other expenses $ (25,550) $ (1,296) (Loss) income before provision for income taxes (64,301) 930 Provision for (benefit from) income taxes 123 (8) 131 (1,638) % Net (loss) income and comprehensive (loss) income $ (64,424) $ 938 77 Table of Contents Revenue Revenue was $20.0 million for the three months ended March 31, 2022 compared to $32.1 million for the three months ended March 31, 2021, representing a decrease of $12.0 million, or 38%. We attribute lower trading volumes to the higher volatility in the market caused by the current macroeconomic conditions. Placement fees decreased by $12.9 million, or 47%, driven by lower trading volumes. Custodial administration fees increased by $0.9 million, or 20%, driven by both an increase in overall custodial accounts, as well as an adjustment to our prices for these services in the second quarter of the year ended December 2021. The following table sets forth our consolidated statements of operations data expressed as a percentage of revenue: Three Months Ended March 31, 2022 2021 (as a percentage of revenue) Revenues: Placement fees 73 % 86 % Custodial administration fees 27 % 14 % Total revenues 100 % 100 % Transaction-based expenses: Transaction-based expenses (1) % (3) % Total revenues, less transaction-based expenses 99 % 97 % Operating expenses: Compensation and benefits 218 % 64 % Professional services 18 % 8 % Acquisition-related transaction costs 19 % % Advertising and market development 7 % 3 % Rent and occupancy 8 % 3 % Technology and communications 10 % 5 % General and administrative 8 % 3 % Depreciation and amortization 5 % 4 % Total operating expenses 293 % 90 % Operating (loss) income (194) % 7 % Interest expenses and other income (expenses): Interest income (expense), net 1 % (2) % Change in fair value of warrant liabilities (130) % (3) % Other income, net 2 % 1 % Total interest expenses and other expenses (127) % (4) % (Loss) income before provision for income taxes (321) % 3 % Provision for (benefit from) income taxes 1 % % Net (loss) income and comprehensive (loss) income (322) % 3 % Transaction-based expenses Transaction-based expenses were $0.1 million for the three months ended March 31, 2022, compared to $1.0 million for the three months ended March 31, 2021, representing a decrease of $0.9 million or 86%, driven by the decrease in the volume of transactions that gave rise to transaction-based expenses. 78 Table of Contents Compensation and benefits Three Months Ended March 31, (in thousands) 2022 2021 $Change % Change Salary $ 10,811 $ 6,991 $ 3,820 55 % Bonus 23,038 11,344 $ 11,694 103 % Benefits 1,262 891 $ 371 42 % Share-based compensation 8,522 1,259 $ 7,263 577 % Other 7 11 $ (4) (36) % Total compensation and benefits $ 43,640 $ 20,496 $ 23,144 113 % Compensation and benefits expense was $43.6 million for the three months ended March 31, 2022, compared to $20.5 million for three months ended March 31, 2021, representing an increase of $23.1 million, or 113%. The increase was primarily attributable to the increase of share-based compensation expense by $7.3 million related mainly to the cumulative catch-up compensation expense for some of the performance and market condition-based options in the amount of $5.8 million. Refer to Note 12, Share-Based Compensation to our unaudited condensed consolidated interim financial statements included elsewhere in this prospectus for more information. The increase in total bonus was driven by the one-time transaction bonus for certain executives of $17.7 million related to the consummation of the Business Combination, of which $12.2 million was to be paid to the executives in cash, with the remaining $5.5 million offset against outstanding promissory notes that were due from these executives as of the Closing Date, partially offset by a decrease in bonuses of $6.0 million or 53% primarily due to decrease in the company performance. Professional services Professional services expense was $3.5 million for the three months ended March 31, 2022, compared to $2.7 million for the three months ended March 31, 2021, representing an increase of $0.8 million, or 30%. The increase in professional services expense is aligned with our plan of becoming a public company. The increase in professional services was primarily due to additional accounting and finance expenses related to increased compliance requirements as a result of becoming a public company. Acquisition-related transaction costs Acquisition-related transaction costs were $3.7 million for the three months ended March 31, 2022, compared to $0 for the three months ended March 31, 2021. The increase in acquisition-related transaction costs was primarily related to transaction costs related to the Business Combination. Advertising and market development Advertising and market development expense was $1.5 million for the three months ended March 31, 2022, compared to $1.0 million for the three months ended March 31, 2021, representing an increase of $0.5 million, or 52%. The increase was driven by an increased investment in new customer acquisition. Rent and occupancy Rent and occupancy expense was $1.6 million for the three months ended March 31, 2022, compared to $0.9 million for the three months ended March 31, 2021, representing an increase of $0.7 million, or 77%. The increase in rent and occupancy expenses is primarily due to one additional operating lease having commenced in December 2021. Technology and communications Technology and communications expense was $2.0 million for the three months ended March 31, 2022, compared to $1.4 million for the three months ended March 31, 2021, representing an increase of $0.6 million, or 41%. The increase in expense pertains primarily to an increase of $0.3 million in software expenses for our growing business, and an increase of $0.3 million for third party software development engineers for the continued development and maintenance of our platform. 79 Table of Contents General and administrative General and administrative expense was $1.6 million for the three months ended March 31, 2022, compared to $1.0 million for the three months ended March 31, 2021, representing an increase of $0.6 million, or 68%. The increase in general and administrative expense was primarily driven by $0.2 million related to an increase in a company liability insurance. We further incurred an increase of $0.4 million related to bad debt expenses and other miscellaneous expenses. Depreciation and amortization Depreciation and amortization expense was $1.1 million for the three months ended March 31, 2022, compared to $1.4 million for the three months ended March 31, 2021, representing a decrease of $0.3 million, or 22%. The decrease was primarily driven by certain intangible assets becoming fully amortized by October 2021. Interest expense, net Interest income, net, was less than $0.1 million for the three months ended March 31, 2022, compared to interest expense, net $0.6 million for the three months ended March 31, 2021, representing a change of $0.6 million. The change was primarily driven by settlement of convertible notes and senior debt during the three months ended June 30, 2021. Change in fair value of warrant liabilities Loss from the change in fair value of warrant liabilities was $26.0 million for the three months ended March 31, 2022, compared to $0.9 million for the three months ended March 31, 2021, representing an increase of $25.1 million. The change was primarily driven by the increase in the fair value of Public Warrants and Private Placement Warrants during the three months ended March 31, 2022. Other income, net Other income, net was $0.4 million for the three months ended March 31, 2022, compared to $0.2 million for the three months ended March 31, 2021, representing an increase of $0.2 million, or 134%, driven by net gain on an equity investment. 80 Table of Contents Results of Operations Comparisons for fiscal years ended December 31, 2021 and December 31, 2020 The following table sets forth our consolidated statement of operations for the twelve months ended December 31, 2021 and 2020, and the dollar and percentage change between the two periods (dollars in thousands): Year Ended December 31, 2021 2020 Change % Change Revenues Placement fees $ 107,723 $ 29,240 $ 78,483 268 % Custodial administration fees 20,333 22,404 (2,071) (9) % Total revenues 128,056 51,644 Transaction-based expenses: Transaction-based expenses (3,034) (3,888) 854 (22) % Total revenues, less transaction-based expenses 125,022 47,756 Operating expenses: Compensation and benefits 94,654 37,330 57,324 154 % Professional services 12,450 3,371 9,079 269 % Acquisition-related transaction costs 882 3,289 (2,407) (73) % Advertising and market development 5,090 1,528 3,562 233 % Rent and occupancy 3,744 2,381 1,363 57 % Technology and communications 8,243 4,616 3,627 79 % General and administrative 4,358 452 3,906 864 % Depreciation and amortization 5,390 2,406 2,984 124 % Total operating expenses 134,811 55,373 Operating loss (9,789) (7,617) Interest expenses and other income (expenses): Interest expense, net (2,307) (2,405) 98 (4) % Change in fair value of warrant liabilities (6,064) (292) (5,772) NM Other income (expense), net 47 (201) 248 123 % Total interest expenses and other expenses (8,324) (2,898) Loss before provision for income taxes (18,113) (10,515) Provision for (benefit from) income taxes 386 (803) 1,189 148 % Net loss and comprehensive loss $ (18,499) $ (9,712) Revenue Revenue was $128.1 million for the year ended December 31, 2021 compared to $51.6 million for the year ended December 31, 2020, representing an increase of $76.5 million, or 148%. Placement fees increased by $78.5 million. The dollar amount of trades executed increased 176% period-over-period, driven by higher trading volumes The Net Take rates increased 110 bps period-over-period. The increase in placement fees was also driven by the SharesPost acquisition, which increased our customer base. The combined company increased coverage of more issuers on our platform. We also benefited from a strong market environment with the expanding number of unicorn companies as well as IPO activity generating more interest in the private markets. Custodial administration fees decreased by $2.0 million, driven by a drop in interest rates. As the Federal Reserve lowers interest rates, our customers receive reduced interest payments on their un-invested cash balances, which in turn affects the portion of sub-accounting fees we receive in exchange for facilitating the acquisition of FDIC insurance on behalf of the customers. 81 Table of Contents The following table sets forth our consolidated statements of operations data expressed as a percentage of revenue: (as a percentage of revenue): Year Ended December 31, 2021 2020 (as a percentage of revenue) Revenues Placement fees 84 % 57 % Custodial administration fees 16 % 43 % Total revenues 100 % 100 % Transaction-based expenses: Transaction-based expenses (2) % (8) % Total revenues, less transaction-based expenses 98 % 92 % Operating expenses: Compensation and benefits 74 % 72 % Professional services 10 % 6 % Acquisition-related transaction costs 1 % 6 % Advertising and market development 4 % 3 % Rent and occupancy 3 % 5 % Technology and communications 6 % 9 % General and administrative 3 % 1 % Depreciation and amortization 4 % 5 % Total operating expenses 105 % 107 % Operating loss Interest expenses and other income (expenses): (8) % (15) % Interest expense, net (2) % (5) % Change in fair value of warrant liabilities (5) % (1) % Other income (expense), net % % Total interest expenses and other expenses (7) % (6) % Loss before provision for income taxes (14) % (21) % Provision for (benefit from) income taxes % (2) % Net loss and comprehensive loss (14) % (19) % Transaction-based expenses Transaction-based expenses were $3.0 million for the year ended December 31, 2021, compared to $3.9 million for the year ended December 31, 2020, representing decrease of $0.9 million or 22%. Though our revenues increased during the same period, the volume of transactions that gave rise to transaction-based expenses decreased. Compensation and benefits Year Ended December 31, (in thousands) 2021 2020 $Change % Change Salary $ 33,197 $ 19,915 $ 13,282 67 % Bonus 45,433 10,303 35,130 341 % Benefits 3,729 2,167 1,562 72 % Share-based compensation 12,231 4,906 7,325 149 % Other 64 39 25 64 % Total compensation and benefits $ 94,654 $ 37,330 $ 57,324 154 % Compensation and benefits expense was $94.7 million for the year ended December 31, 2021, compared to $37.3 million for the year ended December 31, 2020, representing an increase of $57.4 million, or 154%. The increase was primarily attributable to the increase of $35.1 million from bonuses accrued related to our financial performance and individual employee performance. Bonuses were also impacted by the additional headcount acquired from SharesPost and the overall upturn in the market in 2021 as compared to 2020, which contained the initial ramifications of the COVID-19 pandemic on the public and private stock markets. In addition, share- 82 Table of Contents based compensation expense increased by $7.3 million, which was primarily driven by a $4.2 million increase in share-based compensation charges related to secondary transactions in 2021 that did not occur in 2020. Refer to Note 12, Share-based Compensation to our audited annual consolidated financial statements included in this prospectus for more information. Additionally, the increase in compensation and benefits expense was attributable to the increase in employee salaries in the amount of $13.3 million, and benefits in the amount of $1.6 million primarily due to increases in headcount from our acquisitions and organic growth of business operations. Professional services Professional services expense was $12.5 million for the year ended December 31, 2021, compared to $3.4 million for the year ended December 31, 2020, representing an increase of $9.1 million, or 269%. The increase in professional services expense is aligned with our plan of becoming a public company. We incurred increases of $3.0 million in advisor fees related to the issuance of Series B-1 and B-2 convertible preferred stock and the secondary sales of common stock during the year ended December 31, 2021. In addition, we incurred increases in accounting expenses of $2.5 million and legal fees of $1.4 million related primarily to overall increased business operations and increased regulatory review due to filing of the Registration Statement on FormS-4 for the Business Combination. Acquisition-related transaction costs Acquisition-related transaction costs were $0.9 million for the year ended December 31, 2021, compared to $3.3 million for the year ended December 31, 2020, representing a decrease of $2.4 million, or 73%. The decrease in acquisition-related transaction costs was primarily related to the acquisition of SharesPost in 2020. During the year ended December 31, 2020, we incurred $3.3 million in acquisition-related transaction costs primarily related to our acquisition of SharesPost, which was completed in November 2020. Advertising and market development Advertising and market development expense was $5.1 million for the year ended December 31, 2021, compared to $1.5 million for the year ended December 31, 2020, representing an increase of $3.6 million, or 233%. The increase was driven by a combination of increased investment in new customer acquisition, launching a new website, and increased investment in public relations for public company readiness. Rent and occupancy Rent and occupancy expense was $3.7 million for the year ended December 31, 2021, compared to $2.4 million for the year ended December 31, 2020, representing an increase of $1.3 million, or 57%. The increase in rent and occupancy expenses is primarily due to three additional operating leases assumed as a part of the SharesPost acquisition in November 2020. Technology and communications Technology and communications expense was $8.2 million for the year ended December 31, 2021, compared to $4.6 million for the year ended December 31, 2020, representing an increase of $3.6 million, or 79%. The increase in expense pertains primarily to an increase of $1.5 million in software expenses for our growing business, and an increase of $1.8 million for third-party software development engineers for the continued maintenance of our platform. General and administrative General and administrative expense was $4.4 million for the year ended December 31, 2021, compared to $0.5 million for the year ended December 31, 2020, representing an increase of $3.9 million, or 864%. The increase in general and administrative expense was primarily driven by $2.2 million related to a credit for fund insurance premiums as a result of re-negotiation of the insurance premium with our vendor during fiscal year 2020. We further incurred increases of $1.7 million for various costs such as regulatory fees, franchise/business taxes, bank service charges, company liability insurance and travel and entertainment expenses. 83 Table of Contents Depreciation and amortization Depreciation and amortization expense was $5.4 million for the year ended December 31, 2021, compared to $2.4 million for the year ended December 31, 2020, representing an increase of $3.0 million, or 124%. The increase was primarily driven by a $2.6 million increase in the amortization of intangible assets acquired from the acquisition of SharesPost in November 2020, and $0.3 million increase in depreciation and amortization of furniture, leasehold improvements, computer equipment, and capitalized software. Interest expense, net Interest expense, net, was $2.3 million for the year ended December 31, 2021, compared to $2.4 million for the year ended December 31, 2020, representing a decrease of $0.1 million, or 4%. Change in fair value of warrant liabilities Change in fair value of warrant liabilities was a credit balance of $6.1 million for the year ended December 31, 2021, compared to $0.3 million for the year ended December 31, 2020, representing a change of $5.8 million from the year ended December 31, 2020. The change was primarily driven by the increase in the fair value of the securities including common and convertible preferred stock underlying our outstanding warrants as well as the increase in the public company valuation weighting during the year ended December 31, 2021 as compared to the fair value of the underlying securities during the year ended December 31, 2020. Other income (expense), net Other income, net was $0.1 million for the year ended December 31, 2021, compared to other expense, net of $0.2 million for the year ended December 31, 2020, representing an increase of $0.3 million, or 124%. Provision for (benefit from) income taxes Provision for income tax was $0.4 million for the year ended December 31, 2021, compared to benefit from income tax of $0.8 million for the year ended December 31, 2020, representing an increase of $1.2 million, or 148%. The change was primarily driven by the increase in the taxable income during the year ended December 31, 2021 as compared taxable income during the year ended December 31, 2020. Liquidity and Capital Resources To date, we have financed our operations primarily through revenue from operations, issuances of securities,issuances of debt and proceeds from Business Combination. Our primary requirements for liquidity and capital are to finance working capital, capital expenditures and investments in business acquisitions. As of March 31, 2022, our principal source of liquidity was our cash and cash equivalents balance of $202.5 million. Since our inception, we have generated operating losses as reflected in our accumulated deficit. We had an accumulated deficit of $143.0 million as of March 31, 2022. We believe our existing cash and cash equivalents as of March 31, 2022 will be sufficient to meet our operating working capital and capital expenditure requirements for the foreseeable future. Our future financing requirements will depend on many factors including our growth rate, the timing and extent of spending to support development of our platform and the expansion of sales and marketing activities. Although we currently are not a party to any agreement and do not have any understanding with any third parties with respect to potential investments in, or acquisitions of, businesses or technologies, we may enter into these types of arrangements in the future, which could also require us to seek additional equity or debt financing. Additional funds may not be available on terms favorable to us or at all. In addition, we will receive up to an aggregate of approximately $302 million from the exercise of the warrants, assumed warrants and Former Employee Options being offered for sale in this prospectus assuming the exercise of all such securities for cash. We expect to use the net proceeds from the exercise of such securities, if any, for general corporate purposes, which may include acquisitions or other strategic investments. We will have broad discretion over the use of any proceeds from the exercise of such 84 Table of Contents securities. Any proceeds from the exercise of such securities would increase our liquidity, but our ability to fund our operations is not dependent upon receipt of cash proceeds from the exercise of such securities. We intend to continue to make investments in product development, sales effort, and additional general and administrative costs in connection with operating as a public company. We expect to continue to maintain financing flexibility in the current market conditions. As a result, we may require additional capital resources to execute strategic initiatives to grow our business. Our future capital requirements will depend on many factors including our revenue growth rate, the timing, and extent of spending to support further sales and marketing and research and development efforts. We may be required to seek additional equity or debt financing. In the event that additional financing is required from outside sources, we may not be able to raise it on terms acceptable to us or at all. If we are unable to raise additional capital when desired, our business, results of operations, and financial condition would be materially and adversely affected. Cash Flow Summary The following table summarizes our cash flows for the periods presented (in thousands): Three Months Ended March 31, 2022 2021 Net cash provided by (used in): Operating activities $ (30,177) $ (1,243) Investing activities $ (1,692) $ (117) Financing activities $ 159,591 $ (2,431) Operating Activities Cash used in operating activities for the three months ended March 31, 2022 of $30.2 million was primarily driven by our net loss of $64.4 million, adjusted for non-cash charges of $45.8 million and net cash outflow of $11.6 million provided by changes in our operating assets and liabilities. Non-cash charges primarily consisted of share-based compensation of $8.5 million, changes in fair value of warrant liabilities of $26.0 million, depreciation and amortization of $1.1 million, amortization of right-of-use assets of $1.1 million, transaction expenses related to the Business Combination of $3.1 million, settlement of related party promissory notes of $5.5 million, impairment of right-of-use assets of $0.3 million, and increase in bad debt allowance of $0.3 million. The main drivers of the cash outflows from the changes in operating assets and liabilities were related to the decrease in accrued compensation and benefits of $11.6 million, increase in prepaid expenses and other assets in amount of $0.9 million, decrease in accrued expenses and other current liabilities of $0.7 million, and increase in operating lease liability of $1.2 million, partially offset by a decrease in accounts receivable of $2.0 million and increase in accounts payable of $0.9 million. Cash used in operating activities for the three months ended March 31, 2021 of $1.2 million was primarily related to our net income of $0.9 million, adjusted for non-cash charges of $4.4 million and net cash outflows of $6.6 million related to changes in our operating assets and liabilities. Non-cash charges primarily consisted of share-based compensation of $1.3 million, depreciation and amortization of $1.4 million, amortization of right-of-use assets of $0.7 million, provisions for accounts receivable allowances of $0.1 million, changes in fair value of warrant liabilities of $0.9 million, and other non-cash charges of $0.1 million. The main drivers of the cash outflows were derived from the changes in operating assets and liabilities were related to an increase to accounts receivable of $0.3 million, an increase in prepaid expenses and other assets of $0.5 million, a decrease in accounts payable of $0.9 million, a decrease in accrued expenses and other current liabilities of $3.6 million, decrease in accrued compensation and benefits of $0.3 million, and decrease in operating lease liabilities of $0.9 million. Investing Activities Cash used in investing activities was $1.7 million for the three months ended March 31, 2022, which consisted primary of capitalized internal-use software of $1.7 million. Cash used in investing activities was $0.1 million for the three months ended March 31, 2021, which consisted of cash paid for capitalized internal-use software of $0.1 million. 85 Table of Contents Financing Activities Cash provided by financing activities was $159.6 million for three months ended March 31, 2022, which consisted primarily of proceeds from the Business Combination of $7.9 million, proceeds from the PIPE and A&R FPA investors of $208.0 million, and proceeds from exercise of options of $0.1 million, offset by payments for offering costs of $56.4 million. Cash used by financing activities was $2.4 million for the three months ended March 31, 2021, which consisted primarily of repayment of notes payable in amount of $2.9 million partially offset by proceeds from exercise of options, including proceeds from repayment of promissory notes of $0.4 million. Year Ended December 31, 2021 2020 Net cash provided by (used in): Operating activities $ 10,901 $ (2,528) Investing activities $ (3,256) $ (23,373) Financing activities $ 26,581 $ 39,380 Operating Activities Cash provided by operating activities for the year ended December 31, 2021 of $10.9 million was primarily related to our net loss of $18.5 million, adjusted for non-cash charges of $26.6 million and net cash inflows of $2.8 million provided by changes in our operating assets and liabilities. Non-cash charges primarily consisted of share-based compensation of $12.2 million, changes in fair value of warrant liabilities of $6.1 million, depreciation and amortization of $5.4 million, amortization of right-of-use assets of $2.8 million, and other non-cash charges of $0.1 million. The main drivers of the cash inflows were derived from the changes in operating assets and liabilities and were related to an increase in accrued compensation and benefits of $8.1 million and a decrease in accounts receivable of $0.4 million, partially offset by an increase in prepaid expenses and other assets of $1.0 million, a decrease in accounts payable of $0.7 million, a decrease in operating lease liabilities of $3.5 million, and a decrease in accrued expenses and other current liabilities of $0.4 million. Cash used in operating activities for the year ended December 31, 2020 of $2.5 million was primarily related to our net loss of $9.7 million, adjusted for non-cash charges of $10.2 million and net cash outflows of $3.0 million related to changes in our operating assets and liabilities. Non-cash charges primarily consisted of share-based compensation of $4.9 million, depreciation and amortization of $2.4 million, amortization of right-of-use assets of $1.6 million, provisions for accounts receivable allowances of $0.4 million, changes in fair value of warrant liabilities of $0.3 million, and other non-cash charges of $0.5 million. The main drivers of the cash outflows were derived from the changes in operating assets and liabilities and were related to an increase to accounts receivable of $3.4 million, an increase in prepaid expenses and other assets of $2.2 million, a decrease in accounts payable of $1.7 million, and a decrease in operating lease liabilities of $1.7 million, partially offset by an increase in accrued compensation and benefits of $3.9 million, and an increase in accrued expenses and other current liabilities of $2.1 million. Investing Activities Cash used in investing activities was $3.3 million for the year ended December 31, 2021, which consisted of purchases of intangible assets of $2.2 million and $1.1 million related to payments for capitalized internal-use software development costs. Cash used in investing activities was $23.4 million for the year ended December 31, 2020, which consisted primarily of cash paid for acquisitions, net of cash acquired in the amount of $13.1 million related to the SharesPost acquisition, payment of deferred acquisition costs related to the IRA Services acquisition in the amount of $6.1 million, a loan to SharesPost in the amount of $3.0 million, and $1.2 million related to capitalized internal-use software development costs. Financing Activities Cash provided by financing activities was $26.6 million year ended December 31, 2021, which consisted primarily of proceeds from issuance of Series B-1 convertible preferred stock, net of issuance costs, in the amount of $47.7 million, proceeds from issuance of Series B-2 convertible preferred stock in the amount of $1.6 million, and proceeds from exercise of options, including proceeds from the repayment of promissory notes, in the amount of $1.6 million, partially offset by repayments of debt in the amount of $19.4 million, and payments of deferred offering costs of $5 million. 86 Table of Contents Cash provided by financing activities was $39.4 million for the year ended December 31, 2020, which consisted primarily of proceeds from issuance of Series B-1 convertible preferred stock, net of issuance costs in the amount of $41.5 million and proceeds from debt in the amount of $25.6 million, partially offset by repayment of debt in the amount of $27.7 million. Contractual Obligations The following table summarizes our contractual obligations as of March 31, 2022, and the years in which these obligations are due (in thousands): Remainder of Total 2022 2022-2024 2025-2026 Thereafter Operating lease obligations(1) $ 9,795 $ 4,436 $ 4,966 $ 393 $ Non-cancelable purchase obligations(2) 8,606 1,213 2,677 3,653 1,063 Total contractual obligations $ 18,401 $ 5,649 $ 7,643 $ 4,046 $ 1,063 In addition effective March 21, 2022, the Company entered into a D&O insurance policy with an annual premium totaling $5,782, which was fully paid in April 2022. (1) Our lease portfolio primarily includes leased office space, all of which are accounted for as operating leases. Total payments listed represent total minimum future lease payments. (2) In the normal course of business, we entered into non-cancelable purchase commitments with various parties mainly for liability insurance and software products and services. Off-Balance Sheet Arrangements Refer to Note 9, Off Balance Sheet Items , to our unaudited condensed consolidated interim financial statements included elsewhere in this prospectus. Critical Accounting Policies and Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in our audited annual consolidated financial statements and accompanying notes. We base our estimates on historical experience, current business factors and various other assumptions that we believe are necessary to consider forming a basis for making judgments about the carrying values of assets and liabilities, the recorded amounts of revenue and expenses and the disclosure of contingent assets and liabilities. We are subject to uncertainties such as the impact of future events, economic and political factors, and changes in our business environment; therefore, actual results could differ from these estimates. Accordingly, the accounting estimates used in the preparation of our audited annual consolidated financial statements will change as new events occur, as more experience is acquired, as additional information is obtained and as our operating environment changes. Changes in estimates are made when circumstances warrant. Such changes in estimates and refinements in estimation methodologies are reflected in reported results of operations; if material, the effects of changes in estimates are disclosed in the notes to our unaudited condensed consolidated financial statements. On an ongoing basis, we evaluate our estimates and assumptions. Our actual results may differ from these estimates under different assumptions or conditions. The most significant judgments, estimates and assumptions relate to the critical accounting policies, as discussed in more detail below. There have been no material changes to our critical accounting policies and estimates as compared to those described in the section titled Management s Discussion and Analysis of Financial Condition and Results of Operations set forth in our Current Report on Form 8-K dated March 25, 2022, which was filed with the SEC. Revenue Recognition We generate revenue from fees charged for the trading of private placements on our marketplace platform, and fees for account and asset management provided to customers. We disaggregate revenue by service type, as we believe that this level of disaggregation best depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are impacted by economic factors. We 87 Table of Contents recognize revenue pursuant to ASC 606, Revenue from Contracts with Customers. The amount of revenue recognized reflects the consideration that we expect to receive in exchange for services. To achieve the core principle of this standard, we applied the following five steps: 1.Identification of the contract, or contracts, with the customer; 2.Identification of the performance obligations in the contract; 3.Determination of the transaction price; 4.Allocation of the transaction price to the performance obligations in the contract; and 5.Recognition of the revenue when, or as, a performance obligation is satisfied. Revenue from Contracts with Customers We enter into contracts with customers that can include various services, which are generally capable of being distinct and accounted for as separate performance obligations. When applicable, allocation of the transaction fees to the performance obligations or to the distinct goods or services that form part of a single performance obligation will depend on the individual facts and circumstances of the contract. All of our revenues are from contracts with customers. We are the principal in these contracts, with the exception of sub-account fees, in which case we act as the agent and record revenue from fees earned related to cash balances in customers custodial accounts. Refer to the section titled Revenue Recognition and Transaction-Based Expenses in Note 2 to our unaudited condensed consolidated financial statements included elsewhere in this prospectus. Share-Based Compensation We recognize stock-based compensation expense in accordance with the provisions of ASC 718, Compensation Stock Compensation ( ASC 718 ). ASC 718 requires the measurement and recognition of compensation expense for all stock-based awards made to employees, directors and non-employees based on the grant date fair value of the awards. Prior to the Business Combination, the fair value of employee and non-employee stock options was determined on the grant date using the Black-Scholes option pricing model using various inputs, including the fair value of the underlying common stock, the expected term of the stock-based award, the expected volatility of the price of our common stock, risk-free interest rates, and the expected dividend yield of common stock. The assumptions used to determine the fair value of the stock-based awards represent management s best estimates. These estimates involve inherent uncertainties and the application of management s judgment. We recognize stock-based compensation cost on a straight-line basis over the requisite service period of the awards, which generally is the option vesting term. Forfeitures are accounted for as they occur. Changes in the following assumptions can materially affect the estimate of fair value and ultimately how much stock-based compensation expense is recognized. These inputs are subjective and generally require significant analysis and judgment to develop. Fair Value of Common Stock. Prior to the Business Combination, given the absence of a public trading market, our Board, with the input of management, considered numerous objective and subjective factors to determine the fair value of common stock at each meeting in which awards are approved. Following the Business Combination, fair value of common stock is determined by reference to the closing price of our common stock on NYSE. Expected Term. Expected term represents the period that options are expected to be outstanding. We determine the expected term using the simplified method based on the option s vesting term and contractual obligations. Expected Volatility. The volatility is derived from the average historical stock volatilities of a peer group of public companies that we consider to be comparable to our business over a period equivalent to the expected term of the share-based grants. Risk-Free Interest Rate. We derive the risk-free interest rate assumption from the U.S. Treasury s rates for the U.S. Treasury zero-coupon bonds with maturities similar to those of the expected term of the awards being valued. 88 Table of Contents Dividend Yield. We base the assumed dividend yield on its expectation of not paying dividends in the foreseeable future. Consequently, the expected dividend yield used is zero. During the three months ended March 31, 2022, there were no new option grants. The Black-Scholes assumptions used in evaluating our awards during the three months ended March 31, 2021 were as follows: Fair value of common stock $ 0.90 Expected term (years) 5.8 6.1 Expected volatility 40.9% 41.1 % Risk-free interest 1.0% 1.1 % Expected dividend yield 0.0 % The variables used in these models are reviewed on each grant date and adjusted, as needed. As we continue to accumulate additional data related to our common stock valuations and assumptions used in the Black-Scholes model, we may refine our estimates of these variables, which could materially affect our future stock-based compensation expense. These estimates involved in calculating the fair value of our stock options involve inherent uncertainties and the application of significant judgment. We will continue to use judgment in evaluating the assumptions related to our stock-based compensation on a prospective basis. As we continue to accumulate additional data related to our common stock, we may refine our estimation process, which could materially impact our future stock-based compensation expense. As a measure of sensitivity, for every 10% increase in the estimated fair value of our stock options over management s estimates at the grant dates of stock options, share-based compensation expense recognized for the three months ended March 31, 2022 would have increased by $0.8 million and share-based compensation expense recognized for the fiscal year ended March 31, 2021 would have increased by $0.1 million. In addition, we have issued performance-based stock options that vest based upon continued service through the vesting term and achievement of certain market conditions established by our Board for a predetermined period. We measure stock-based compensation expense for performance-based stock options containing market conditions based on the estimated grant date fair value determined using the Monte Carlo valuation model. We recognize compensation expense for such awards over the requisite service period using the accelerated attribution method when it becomes probable that the performance condition will be satisfied. For the three months ended March 31, 2022 we recognized $4.6 million of stock based compensation expense related to performance-based stock options. Emerging Growth Company Status We are an emerging growth company ( EGC ), as defined in the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). The JOBS Act permits companies with EGC status to take advantage of an extended transition period to comply with new or revised accounting standards, delaying the adoption of these accounting standards until they would apply to private companies. We have elected to use this extended transition period to enable us to comply with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we (i) are no longer an EGC or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act. As a result, our financial statements may not be comparable to companies that comply with the new or revised accounting standards as of public company effective dates. In addition, we intend to rely on the other exemptions and reduced reporting requirements provided by the JOBS Act. Subject to certain conditions set forth in the JOBS Act, if, as an EGC, we intend to rely on such exemptions, we are not required to, among other things: (i) provide an auditor s attestation report on our system of internal controls over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act; (ii) provide all of the compensation disclosure that may be required of non-emerging growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act; (iii) comply with any requirement that may be adopted by the Public Company Accounting Oversight Board; and (iv) disclose certain executive compensation-related items such as the correlation between executive compensation and performance and comparisons of the Chief Executive Officer s compensation to median employee compensation. We will remain an EGC under the JOBS Act until the earliest of (i) the last day of our first fiscal year following the fifth anniversary of the closing of the Business Combination, (ii) the last date of our fiscal year in which we have total annual gross revenue of at least $1.07 billion, (iii) the date on which we are deemed to be a large accelerated filer under the rules of the SEC with at least $700.0 million of outstanding securities held by non-affiliates, or (iv) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the previous three years. 89 Table of Contents Recent Accounting Pronouncements See the section titled Summary of Significant Accounting Policies in Note 2 of the notes to our unaudited condensed consolidated financial statements included in this prospectus for more information. 90 Table of Contents CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS Certain Relationships and Related Person Transactions Forge Registration Rights Agreement At the Closing, the Sponsor, Forge Global Holdings, Inc. ("Forge"), and certain shareholders (the RRA Holders ), entered into an Amended and Restated Registration Rights Agreement (the A&R Registration Rights Agreement ), pursuant to which Forge agreed to register for resale, pursuant to Rule 415 under the Securities Act, certain shares of common stock and other equity securities of Forge that are held by the RRA Holders from time to time. Under the A&R Registration Rights Agreement, Forge agreed, within 30 calendar days after the Closing, to file this registration statement with the SEC registering the resale of certain securities held by or issuable to the RRA Holders, and to use its reasonable best efforts to have such registration statement declared effective by the SEC as soon as practicable thereafter. The Forge shareholders and the Sponsor will each be entitled to make three written shelf takedown requests that Forge register the resale of any or all of its common stock, so long as such demand is for at least $20 million in shares of common stock proposed to be sold. Subject to certain customary exceptions, if at any time Forge proposes to file a registration statement under the Securities Act with respect to its securities, Forge will give notice to the relevant security holders party to the A&R Registration Rights Agreement as to the proposed filing and offer such security holders an opportunity to register the resale of such number of shares of their common stock as requested by such shareholders, subject to customary cutbacks in an underwritten offering. Any other shareholders of Forge with piggyback registration rights may also participate in any such registrations, subject to customary cutbacks in an underwritten offering. Indemnification Agreements We entered into indemnification agreements with our directors and executive officers. The indemnification agreements and our Governing Documents require us to indemnify our directors and executive officers to the fullest extent permitted by law. Related Party Loans In October 2019, Legacy Forge issued convertible notes to investors, of which $2.4 million was received from certain directors and employees of Legacy Forge. As of December 31, 2020, Forge had a $2.4 million related party balance on convertible notes outstanding. The notes were fully repaid in January 2021. FT Partners Financial Technology Partners LP ( FTP ), a shareholder of Forge, serves as financial and strategic advisor to Forge. During the three months ended March 31, 2022, Forge incurred $18.2 million in fees to FTP, of which $17.3 million was related to common stock issued during the Merger and was recorded as a reduction to additional paid-in capital. The remaining $.9 million was related to issuance of Public and Private Placement Warrants, including warrants issued to A&R FPA investors, and was expensed immediately upon consummation of the Merger as acquisition-related transaction cost in the condensed consolidated statements of operations and comprehensive (loss) income. Steve McLaughlin is the CEO and founder of FTP and served as a director of Forge during the aforementioned time periods. New Executive Agreements, Transaction Bonuses and Retention Equity Grants and Loan Forgiveness Concurrent with the execution of the Merger Agreement, Legacy Forge executed employment agreements with each of Kelly Rodriques, Mark Lee, and Jose Cobos (the New Executive Agreements ). Upon the Closing, Forge assumed by operation of law the rights and obligations of Legacy Forge under each of the New Executive Agreements. In connection with the Closing, each of the executive officers became eligible to receive a Transaction Bonus and Retention Equity Grant as set forth in the New Executive Agreements. Additionally, immediately prior to the Business Combination, certain executive officers became entitled to the forgiveness of certain outstanding promissory notes between the executive and Legacy Forge. See the section entitled Executive Compensation for further information. 91 Table of Contents PIPE Subscriptions James Herbert, II, through the James and Cecillia Herbert 1994 Revocable Trust, purchased 75,000 shares of Forge s common stock (for a purchase price of $750,000) in the PIPE Financing, concurrently and in connection with the closing of the Business Combination. Ossa Investments Pte. Ltd, a 5% stockholder of Forge, purchased 1,000,000 shares of the Company s common stock (for a purchase price of $10,000,000) in the PIPE Financing. These transaction were on the same terms as the other investors who purchased shares in the PIPE Financing pursuant to certain subscription agreements dated September 13, 2021. Related Person Transactions Policy Forge s Board of Directors adopted a written related person transaction policy that sets forth the following policies and procedures for the review and approval or ratification of related person transactions. A Related Person Transaction is a transaction, arrangement or relationship in which Forge or any of its subsidiaries was, is or will be a participant, the amount of which involved exceeds $120,000, and in which any related person had, has or will have a direct or indirect material interest. A Related Person means: any person who is, or at any time during the applicable period was, one of Forge s executive officers or a member of Forge s Board of Directors; any person who is known by Forge to be the beneficial owner of more than five percent (5%) of our voting stock; any immediate family member of any of the foregoing persons, which means any child, stepchild, parent, stepparent, spouse, sibling, mother-in-law, father-in-law, daughter-in-law, brother-in-law or sister-in-law of a director, officer or a beneficial owner of more than five percent (5%) of our voting stock, and any person sharing the household of such director, executive officer or beneficial owner of more than five percent (5%) of our voting stock; and any firm, corporation or other entity in which any of the foregoing persons is a partner or principal or in a similar position or in which such person has a 10 percent (10%) or greater beneficial ownership interest. Forge has policies and procedures designed to minimize potential conflicts of interest arising from any dealings it may have with its affiliates and to provide appropriate procedures for the disclosure of any real or potential conflicts of interest that may exist from time to time. Specifically, the audit committee has the responsibility to review related person transactions. Certain Relationships and Related Person Transactions Motive Founder Shares On October 2, 2020, the Sponsor paid $25,000 to cover certain of Motive s offering and formation costs in consideration for 11,500,000 Founder Shares. On November 24, 2020, the Sponsor surrendered 2,875,000 Founder Shares, which we canceled. On November 24 and December 8, 2020, the Sponsor transferred 30,000 Founder Shares to each of the independent directors. On December 10, 2020, we issued a dividend of 1,725,000 Motive Class B Shares, resulting in 10,350,000 Founder Shares outstanding. Private Placement Units Simultaneously with the closing of Motive s Initial Public Offering, the Sponsor purchased an aggregate of 7,386,667 Motive Private Warrants at a price of $1.50 per Motive Private Warrant, for an aggregate purchase price of $11,080,000, in a private placement. Each Motive Private Warrant is exercisable to purchase one Motive Class A Share at a price of $11.50 per share, subject to adjustment. Promissory Note Related Party On October 1, 2020, Motive issued an unsecured promissory note (the Promissory Note ) to the Sponsor, pursuant to which we may borrow up to an aggregate principal amount of $300,000. The Promissory Note was non-interest bearing and payable on the earlier of (i) December 31, 2020 and (ii) the completion of the Initial Public Offering. We borrowed an aggregate 92 Table of Contents of approximately $130,000 under the Promissory Note. The Promissory Note matured on the closing date of Motive s Initial Public Offering and the outstanding balance under the Promissory Note of $130,492 was repaid in full on December 16, 2020. Registration and Shareholder Rights Pursuant to a registration and shareholders rights agreement entered into on December 10, 2020, the holders of the Founder Shares, Motive Private Warrants and any warrants that may be issued upon conversion of Working Capital Loans (and any Motive Class A Shares issuable upon the exercise of the Motive Private Warrants and warrants that may be issued upon conversion of the Working Capital Loans) have registration rights to require us to register a sale of any of our securities held by them pursuant to a registration rights agreement. The holders of these securities are entitled to make up to three demands, excluding short form demands, that we register such securities. In addition, the holders have certain piggy-back registration rights with respect to registration statements filed subsequent to the completion of a Business Combination. The registration rights agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering our securities. We will bear the expenses incurred in connection with the filing of any such registration statements. Pursuant to the Merger Agreement, the registration and shareholder rights agreement was amended and restated to provide for additional registration rights for Forge. Sponsor Support Agreement Concurrent with the execution of the Merger Agreement, Motive, Forge, the Sponsor and other holders of Motive Class B Shares entered into the Sponsor Support Agreement. Pursuant to the Sponsor Support Agreement, the Sponsor and such holders of Motive Class B Shares agreed to (i) vote all shares of Motive stock they own in favor of the transactions contemplated by the Merger Agreement and (ii) waive certain anti-dilution rights with respect to their Motive Class B Shares. Additionally, pursuant to the Sponsor Support Agreement, the Sponsor also has agreed to certain transfer restrictions with respect to the Sponsor Lockup Securities as follows: (a) one-third of the Lockup shares will be subject to a one year lock-up, and will be released from such lock-up if the closing price of our common stock equals or exceeds $12.00 for any 20 trading days in a 30-consecutive trading day period commencing 150 days post-Closing, (b) one-third of the Lockup warrants will be subject to a six month lock-up, (c) one-third of the Sponsor Lockup Securities will be subject to a three year lock-up, and will be released from such lock-up no earlier than six months after the Closing if the closing price our common stock equals or exceeds $12.50 for any 20 trading days in a 30-consecutive trading day period post-Closing, and (d) one-third of the Sponsor Lockup Securities will be subject to a three year lock-up, and will be released from such lock-up no earlier than six months after the Closing if the closing price our common stock equals or exceeds $15.00 for any 20 trading days in a 30-consecutive trading day period post-Closing. Forward Purchase Agreement; A&R FPA The Company entered into a forward purchase agreement to which the Motive Funds purchased an aggregate of 14,000,000 Motive Units, consisting of one Motive Class A Share and one-third of one Motive Public Warrant to purchase one Motive Class A Share for $10.00 per unit, or $140,000,000 in the aggregate, in a private placement that closed on March 21, 2022. 93 Table of Contents MANAGEMENT Management and Board of Directors The following table provides information regarding our executive officers and directors as of May 17, 2022: Name Age Position Kelly Rodriques 58 Chief Executive Officer and Director Mark Lee 62 Chief Financial Officer Jose Cobos 49 Chief Operating Officer Ashwin Kumar 55 Director Blythe Masters 52 Director Stephen George 54 Director Christoph Hansmeyer 47 Director Kimberly Vogel 54 Director James Herbert, II 77 Director Steven McLaughlin 57 Director Information about Executive Officers and Directors Kelly Rodriques is our Chief Executive Officer and director. Mr. Rodriques has been Forge s Chief Executive Officer since July 2018. Prior to Forge, Mr. Rodriques served as Chief Executive Officer of PENSCO Trust Company from March 2010 to September 2016. Since September 2016, he has been the Managing General Partner of Operative Capital, an early stage investor in FinTech companies. He was previously an Operating Partner at Ignition Growth Capital from October 2006 to January 2010, where he led the investment in mFoundry, a leading mobile banking software company. He served as the Chief Executive Officer of Totality from 2002 to 2006. He previously served as the Chief Executive Officer of Novo from 1994 to 2002. Mr. Rodriques earned his B.S. degree from California State University, Fresno. We believe Mr. Rodriques is qualified to serve on our Board due to his service as Chief Executive Officer of Forge, his significant leadership experience and his extensive management experience in the FinTech industry. Mark Lee is our Chief Financial Officer. Mr. Lee has been Forge s Chief Financial Officer since October 2018. Prior to Forge, he served as Chief Operating Officer of PENSCO Trust Company from September 2015 to August 2018. He served as the Chief Financial Officer of Stanford Management Company from 2005 to 2013. He also served as a Group Chief Financial Officer at Charles Schwab & Co., Inc. from 1996 to 2005. He previously was a Principal at Barclays Global Investors from 1994 to 1996 and a Vice President at Goldman Sachs from 1987 to 1994. He started his career as a Financial Manager at Hewlett Packard from 1983 to 1987. Mr. Lee earned his M.B.A. degree from the University of Chicago in 1983 and his Bachelor of Business Administration in accounting and finance from University of California, Berkeley in 1981. Jose Cobos is our Chief Operating Officer. Mr. Cobos joined Forge as Chief Revenue Officer in November 2019 and has served as Chief Operating Officer since May 2021. Prior to Forge, he served as the Head of Technology Capital Markets at the NYSE from January 2018 to November 2019. He previously served as a Managing Director of Cowen Inc. from 2011 to December 2017 and was mostly recently a Principal at Piper Jaffray where he worked from 2004 to 2011. He started his career serving as a Navy SEAL Officer from 1995 to 2001 and worked at General Mills from 2003 to 2004. Mr. Cobos earned his M.B.A. degree from Stanford University in 2003 and his B.S. degree in Economics from the United States Naval Academy. 94 Table of Contents Ashwin Kumar is a director of Forge. Mr. Kumar is an industry partner at Motive Partners, which he joined in 2021. Prior to joining Motive Partners, from 2018 to 2021, Mr. Kumar was founding partner of 7RIDGE, a private markets asset manager invested in fintech and associated transformative technologies. Mr. Kumar s extensive experience spans investment banking capital markets, investing and market infrastructure across the United States and Europe with over 30 years in the financial sector. Prior to 7RIDGE, Mr. Kumar was Managing Director, Global Head of Group Product and Business Development at Deutsche B rse from 2015 to 2018. As member of the senior executive leadership team, Mr. Kumar was a member of the Group Management Committee, Group Risk Committee, Corporate Venture Capital Investment Committee, Product Development Lab Steering Committee and Datafication Council. Preceding this, Mr. Kumar has over 14 years of experience on the investing side including being a founding partner at Meru Capital and Old Lane Partners, both global multi-strategy hedge funds investing across all major asset class and regions across both public and private markets. Prior to this, Mr. Kumar held senior executive roles at capital markets divisions of global banks including as Managing Director, Head of Rates Trading Europe and Head of Strategic Rates Trading Europe at Bank of America; Managing Director, Head of US Rates Trading for Commerzbank Securities USA and at Credit Suisse First Boston where he ran the global US Treasury Options business. Mr. Kumar has served as Board Member of Digital Asset Holding, a leading enterprise DLT fintech and Pratham U.K., an NGO focused on education, and is currently a Board Member of Trumid, a leading fintech company enabling the electronification and transformation of fixed income marketplaces. and Martial Arts Charitable Trust. Mr. Kumar received his BS in Industrial Management/Industrial Engineering from Purdue University in 1986 and graduated with an MBA in Finance from University of Chicago in 1988. Blythe Masters is a director of Forge. Ms. Masters has served as the Chief Executive Officer and a director of Motive Capital Corp since 2020. Ms. Masters is an Industry Partner at Motive Partners, which she joined in 2019. Prior to joining Motive Partners, Ms. Masters served from 2015 to 2018 as the CEO of Digital Asset Holdings, the leading enterprise blockchain fintech software company responsible for the Australian Securities Exchange s post trade infrastructure replacement project. Prior to joining Digital Asset Holdings, Ms. Masters was a senior executive at J.P. Morgan for 27 years from 1987 to 2014. Ms. Masters was a member of the Corporate & Investment Bank Operating Committee and firmwide Executive Committee, along with other positions including Head of Global Commodities, Head of Corporate & Investment Bank Regulatory Affairs, CFO of the Investment Bank, Head of Global Credit Portfolio and Credit Policy and Strategy and Head of Structured Credit. Ms. Masters serves as Board Member and Member of the Compensation and Risk Committees of Credit Suisse Group AG, Board Member of A.P. Moller Maersk, Board Member and Audit Committee Chair of GCM Grosvenor, Member of the International Advisory Board of Santander Group and Santander s Open Digital Services Board. Ms. Masters is a member of the Advisory Board of the US Chamber of Digital Commerce, Figure Technologies and Maxex as well as a member of the Brookings Institution Taskforce on Financial Stability and P.R.I.M.E. Finance (the Hague based Panel of Recognized International Market Experts in Finance). Ms. Masters is a graduate and Senior Scholar of Trinity College, Cambridge where she received a B.A. in Economics. Stephen George is a director of Forge. Mr. George is the co-founder and has been the Managing Partner of Panorama Point Partners, LLC since its inception in January 2012. Mr. George previously was the founding Chief Investment Officer and Managing Partner of Capricorn Investment Group, LLC from 2002 to 2013. Mr. George was a Vice President at Goldman Sachs at its San Francisco office from 1995 to 1999. He earned his Bachelor of Arts degree from Cornell University in 1989. Christoph Hansmeyer is a director of Forge. Mr. Hansmeyer has been a director of Forge since January 2020. He has been Head of Group Strategy and M&A, as well as Chief of Staff at Deutsche B rse AG since 2018. He was previously with Allianz SE, based in Munich, Germany from 2012 until 2018, where he held positions in Group Merger & Acquisitions and in the company s Group Strategy & Portfolio Management team. Before that, he spent 12 years at Goldman Sachs from 1999 to 2012, working in the Investment Banking Division of the Financial Institutions Group with responsibility for Frankfurt, New York and London. He earned his master s degree in Business Administration at the WHU Otto Beisheim School of Management in Koblenz, Germany in 1999. Kimberly Vogel is a director of Forge. Ms. Vogel has been a director of Trico Bancshares and Tricounties Bank and a member of its Audit Committee, Cyber Risk and Information Technology Committee, and Compensation and Management Succession Committee since February 2020. Ms. Vogel has been a director of TriplePoint Venture Growth BDC Corp. and a member of its Audit Committee, Valuation Committee, Compensation Committee and Nominating and Corporate Governance Committee since December 2021. She was President, Co-Founder and director of BaseVenture Investing, Inc. from 2014 to 2019, serving as Transitional President in 2019 after the company was sold to Fidelity National Information Services, Jacksonville, Florida (FIS). From 2005 to 2014, she was the Chief Financial Officer and a Founding Investor at mFoundry Inc. She was the Chief Financial Officer of Semaphore Partners from 1998 to 2003. She was previously a Vice President and Senior Equity Research Analyst at Montgomery Securities (Bank of America Securities) from 1995 to 1998. She served as a Senior Financial Auditor at Sutter Health Systems from 1992 to 1993 and a Senior Accountant and Auditor at KPMG from 1989 to 1992. She was an adjunct professor and currently serves on the Board of 95 Table of Contents Trustees of Saint Mary s College of California. She earned her Master of Business Administration degree at Harvard Graduate School of Business in 1995 and her Bachelor of Science degree at Saint Mary s College in 1989. Ms. Vogel is a Certified Public Accountant. James Herbert, II is a director of Forge. Mr. Herbert founded First Republic Bank in 1985, serving as its Chairman and Chief Executive Officer before being appointed Executive Chairman in March 2022. Previously, he was the founding Chief Executive Officer, President and a director of San Francisco Bancorp from 1980 to 1985. He served as the Federal Reserve s Twelfth District member of the Federal Advisory Council from 2018 to 2020 and was also a member of the U.S. Department of the Treasury s Community Development Advisory Board. Mr. Herbert holds board/trustee positions with the San Francisco Ballet Association (formerly Chair); Lincoln Center for the Performing Arts (Executive Committee), New York; and The BASIC Fund. He is also Founder and Board Chair of Chelsea Factory, a New York arts and cultural center. Mr. Herbert served as a trustee of Babson College from 2015 to 2021. He received his Bachelor of Science degree from Babson College in 1966 and his Master of Business Administration degree from New York University in 1969. Steven McLaughlin is a director of Forge. Mr. McLaughlin has been a director of Forge since July 2018. Mr. McLaughlin has been the Managing Partner and CEO of Financial Technology Partners LP since January 2002. Since July 2017, he has been a director of Feedzai Consultadoria e Inova o Tecnol gica, S.A. Since December 2020, he has been a director of Independence Holdings Corp. Since February 2017, he has been a director of FinTech Partners Ltd (UK). From March 2018 to February 2021, he was a director of Motionsoft, Inc. From October 2015 to August 2020, he was a director of AvidXchange, Inc. From 1994 to 2002, Mr. McLaughlin was the Head of the Global Financial Technology Group, Investment Banking at Goldman Sachs. He earned his Master of Business Administration from the Wharton School in 1995 and his Bachelor of Science in Business Administration degree from Villanova University in 1990. Board of Directors Our Board currently consists of eight (8) directors. Under the terms of the Certificate of Incorporation, our Board is divided into three classes designated as Class I, Class II and Class III. Class I directors Kimberly Vogel and Stephen George) will initially serve for a term expiring at the first annual meeting of stockholders following the Closing Date. Class II (Steven McLaughlin, James Herbert, II and Christoph Hansmeyer) and Class III directors (Kelly Rodriques, Blythe Masters and Ashwin Kumar) will initially serve for a term expiring at the second and third annual meeting of stockholders following the Closing Date, respectively. At each succeeding annual meeting of stockholders, directors will be elected for a full term of three years to succeed the directors of the class whose terms expire at such annual meeting of the stockholders. There will be no limit on the number of terms a director may serve on our Board. Under the Bylaws, directors are elected by a plurality voting standard, whereby each of our stockholders may not give more than one vote per share towards any one director nominee. There are no cumulative voting rights. Committees of the Board of Directors Our Board directs the management of its business and affairs, as provided by Delaware law, and conducts its business through meetings of the Board and standing committees. Forge has a standing audit committee, compensation committee and nominating and corporate governance committee, each of which operate under a written charter. Audit Committee The audit committee consists of Kimberly Vogel, Christoph Hansmeyer and Ashwin Kumar, with Kimberly Vogel serving as the chair of the committee. Each of these individuals has been determined to meet the independence requirements of the Sarbanes-Oxley Act of 2002, as amended, or the Sarbanes-Oxley Act, Rule 10A-3 under the Exchange Act and applicable NYSE listing rules, including the requirements for financial literacy under the applicable rules and regulations of the SEC and NYSE listing rules. In arriving at this determination, the Board examined each audit committee member s scope of experience and the nature of their prior and/or current employment. The Board has determined that Kimberly Vogel qualifies as an audit committee financial expert within the meaning of SEC regulations and meets the financial sophistication requirements of the NYSE listing rules. In making this determination, the Board considered Kimberly Vogel s formal education and previous and current experience in financial and accounting roles. The 96 Table of Contents independent registered public accounting firm and management periodically will meet privately with the audit committee. The audit committee s responsibilities include, among other things: appointing, compensating, retaining, evaluating, terminating and overseeing the independent registered public accounting firm; discussing with the independent registered public accounting firm their independence from management; reviewing with the independent registered public accounting firm the scope and results of their audit; pre-approving all audit and permissible non-audit services to be performed by the independent registered public accounting firm; overseeing the financial reporting process and discussing with management and the independent registered public accounting firm the interim and annual financial statements to be filed with the SEC; reviewing and monitoring accounting principles, accounting policies, financial and accounting controls and compliance with legal and regulatory requirements; and establishing procedures for the confidential anonymous submission of concerns regarding questionable accounting, internal controls or auditing matters. Compensation Committee The compensation committee consists of Stephen George, James Herbert, II and Blythe Masters, with Stephen George serving as the chair of the committee. Stephen George, James Herbert, II and Blythe Masters are non-employee directors, as defined in Rule 16b-3, as defined in Rule 16b-3 promulgated under the Exchange Act. The Board has determined that Stephen George, James Herbert, II and Blythe Masters are independent as defined under applicable NYSE listing standards, including the standards specific to members of a compensation committee. The compensation committee s responsibilities include, among other things: reviewing and approving corporate goals and objectives relevant to the compensation of the Chief Executive Officer, evaluating the performance of the Chief Executive Officer in light of these goals and objectives and setting or making recommendations to the Board regarding the compensation of the Chief Executive Officer; reviewing and setting, or making recommendations to the Board regarding, the compensation of other executive officers; making recommendations to the Board regarding the compensation of directors; reviewing and approving, or making recommendations to the Board regarding, incentive compensation and equity-based plans and arrangements; and appointing and overseeing any compensation consultants. Nominating and Corporate Governance Committee The nominating and corporate governance committee consists of Christoph Hansmeyer, Blythe Masters and Kimberly Vogel, with Christoph Hansmeyer serving as the chair of the committee. The Board has determined that each of these individuals is independent as defined under applicable SEC rules and NYSE listing standards. The nominating and corporate governance committee s responsibilities include, among other things: identifying individuals qualified to become members of the Board, consistent with criteria approved by the Board; recommending to the Board the nominees for election to the Board at annual meetings of shareholders; overseeing an evaluation of the Board and its committees; and 97 Table of Contents developing and recommending to the Board a set of corporate governance guidelines The Board may from time to time establish other committees. Code of Ethics We have adopted an amended and restated Code of Business Conduct and Ethics that applies to our officers and employees, including our principal executive officer, principal financial officer and principal accounting officer, which is available at https://forgeglobal.com/investor-relations. The information on any of our websites is deemed not to be incorporated in or to be a part of this prospectus. 98 Table of Contents EXECUTIVE COMPENSATION Unless the context otherwise requires, any reference in this section to Forge, the Company, we, us or our refers to Forge Global, Inc. and its consolidated subsidiaries prior to the consummation of the Business Combination and to Forge Global Holdings, Inc. and its consolidated subsidiaries following the Business Combination. As an emerging growth company, we have opted to comply with the executive compensation disclosure rules applicable to smaller reporting companies as such term is defined in the rules promulgated under the Securities Act, which require compensation disclosure for its principal executive officer and its two other most highly compensated executive officers. This section discusses the material components of the executive compensation program offered to the executive officers of Forge who would have been named executive officers for 2021 and who currently serve as the executive officers of Forge. Such executive officers consist of the following persons, referred to herein as our named executive officers ( NEOs ): Kelly Rodriques, Chief Executive Officer; Mark Lee, Chief Financial Officer; and Jose Cobos, Chief Operating Officer. This discussion may contain forward-looking statements that are based on our current plans, considerations, expectations and determinations regarding future compensation programs. Actual compensation programs that Forge adopts in the future could vary significantly from our historical practices and currently planned programs summarized in this discussion. 99 Table of Contents 2021 Summary Compensation Table The following table presents information regarding the total compensation awarded to, earned by and paid to our NEOs for services rendered to Forge in all capacities in fiscal years ended December 31, 2021 and 2020 ( Fiscal Years 2021 and 2020 ). Name and Principal Position Year Salary ($) Option Awards ($)(1) Non-Equity Plan Compensation Earnings ($) All other compensation ($)(5) Total ($) Kelly Rodriques Chief Executive Officer 2021 2020 502,000 381,742 8,568,795 552,200 500,000 (2) (3) 5,800 5,901 9,628,795 881,742 Mark Lee Chief Financial Officer 2021 2020 381,000 341,975 552,637 335,375 250,000 (2) (3) 5,800 3,903 716,375 1,144,612 Jose Cobos Chief Operating Officer 2021 2020 415,417 356,627 1,828,996 726,571 1,270,899 1,549,322 (2) (4) 5,800 887 3,515,312 2,632,520 (1)The amounts reported represent the aggregate grant date fair value of the stock option awards granted to our NEOs during Fiscal Years 2021 and 2020, as applicable, calculated in accordance with FASB ASC Topic 718. Such grant date fair values do not take into account any estimated forfeitures. The amounts reported for awards granted to Mr. Rodriques in 2021 subject to performance conditions were calculated based on the probable outcome of the performance conditions as of the grant date, consistent with FASB ASC Topic 718. The assumptions used in calculating the grant date fair value of the stock option awards reported in this column are set forth in note 12 of our financial statements included elsewhere in this prospectus. The amounts reported in this column reflect the accounting cost for these stock option awards and do not correspond to the actual economic value that may be received by our NEOs upon the exercise of the stock option awards or any sale of the underlying shares of Forge common stock. (2)The amounts reported represent annual cash incentive bonuses earned by Messrs. Rodriques, Lee and Cobos in 2021 but paid by the Company in 2022, based on our achievement of certain corporate and individual performance goals for 2021. (3)The amounts reported represent annual cash incentive bonuses earned by Messrs. Rodriques and Lee in 2020 but paid by the Company in 2021, based on our achievement of certain corporate and individual performance goals for 2020. For more information on these bonuses, see the description of the annual performance bonuses under 2021 Annual Bonuses below. (4)The amount reported represents the annual incentive bonus earned by Mr. Cobos in 2020. Mr. Cobos received $913,455 of his 2020 annual incentive bonus in cash which was paid by the Company in 2021, and $635,867 of his 2020 annual incentive bonus paid in the form of a stock option grant, with the number of shares subject to the option determined by dividing, on a pre-conversion basis, 635,867 by the Forge preferred stock price of $12.4168. Consistent with FASB ASC Topic 718, the strike price of the option grant was determined based on the fair market value of Forge s common stock as of December 31, 2020, which was $5.00. (5)The amounts reported represent matching contributions contributed by the Company to each NEO s account in the Company s 401(k) plan. Narrative Disclosure to the Summary Compensation Table 2021 Base Salaries Our NEOs each receive a base salary to compensate them for services rendered to our Company. The base salary payable to each NEO is intended to provide a fixed component of compensation reflecting the executive s skill set, experience, role and responsibilities. Base salaries are reviewed annually, typically in connection with our annual performance review process, approved by our Board or the compensation committee of our Board (the compensation committee ), and may be adjusted from time to time to realign salaries with market levels after taking into account individual responsibilities, performance, and experience. As of December 31, 2021, the annual base salaries for Messrs. Rodriques, Lee and Cobos were $502,000, $392,000, and $500,000, respectively. Each of these annual base salary rates represented an increase compared to these officers annual base salaries for Fiscal Year ended December 31, 2020. The annual base salary rates increased by $122,000, $22,000 and $145,000 for each of 100 Table of Contents Messrs. Rodriques, Lee and Cobos, respectively. While the increase in the annual base salary rate was effective as of January 1, 2021 for Mr. Rodriques, the increase in the annual base salary rates for Messrs. Lee and Cobos took effect mid-year in September 2021. These annual base salaries were increased in connection with each officer s entry into the Executive Agreements (as defined below) in order to more closely align with market rate salaries for similarly situated executives at companies of a size relatively comparable size to that of the Company. 2021 Annual Bonuses During the year ended December 31, 2021, Messrs. Rodriques, Lee and Cobos were eligible to earn annual incentive bonuses based on the achievement of certain company performance objectives, including revenue targets, and individual performance. For the Fiscal Year ended December 31, 2021, the target annual bonuses (as a percentage of annual base salary) for Messrs. Rodriques, Lee and Cobos were 110%, 78%, and 110%, respectively. Each of these target annual bonus rates represented a change compared to the target annual bonus rates of Messrs. Rodriques, Lee and Cobos for Fiscal Year ended December 31, 2020 of 100%, 75% and 425%, respectively. These target annual bonus rates were increased in connection with each officer s entry into the Executive Agreements in order to more closely align with market rate bonuses for similarly situated executives at companies of a size relatively comparable to that of the Company. With respect to Mr. Rodriques, performance objectives were mutually determined between Mr. Rodriques and our Board. With respect to Messrs. Lee and Cobos, performance objectives were mutually determined between the NEO and Mr. Rodriques. In accordance with the Executive Agreements, each NEO s annual bonus for 2021 (other than Mr. Rodriques) was determined using each NEO s target percentage with respect to his annual bonus, and pro-rated from July 1, 2021 through December 31, 2021. The remaining portion of each such NEO s annual bonus for 2021 was determined based on the bonus arrangement in effect from January 1 through June 30, 2021, with the individual performance component deemed to be fully achieved and the company performance component determined based on performance for all of 2021. Based on the level of achievement of their respective performance objectives, Messrs. Rodriques, Lee and Cobos earned annual bonuses equal to $552,200 (representing 110% of base salary), $335,375 (representing 86% of base salary), and $1,270,899 (representing 254% of base salary), respectively. Equity Incentive Compensation Although we do not have a formal policy with respect to the grant of equity incentive awards to our executive officers, we believe that equity grants provide our executives with a strong link to our long-term performance, create an ownership culture and help to align the interests of our executives and our stockholders. In addition, we believe that equity grants promote executive retention because they incentivize our executive officers to remain in our employment during the applicable vesting period. Accordingly, our Board or our compensation committee periodically review the equity incentive compensation of our executives and may grant equity incentive awards to them from time to time. During the Fiscal Year ended December 31, 2021, we granted option awards to our NEOs under the Amended and Restated Forge Global, Inc. 2018 Equity Incentive Plan, which was most recently amended and restated as of June 11, 2021 (as amended and restated, the 2018 Plan ). For additional information on awards granted during Fiscal Year 2021, please see the table under Outstanding Equity Awards at 2021 Fiscal Year-End below. Perquisites We do not provide significant perquisites or personal benefits to our employees with an aggregate value equal to or greater than $10,000. 401(k) Plan We currently maintain a tax-qualified 401(k) retirement savings plan for our employees, including our NEOs, who satisfy certain eligibility requirements. Our NEOs are eligible to participate in the 401(k) plan on the same terms as other full-time employees. Our 401(k) plan is intended to qualify for favorable tax treatment under Section 401(a) of the Code and contains a cash or deferred feature that is intended to meet the requirements of Section 401(k) of the Code. We provide matching contributions under the 401(k) Plan, and provided such contributions during the 2021 Fiscal Year. We believe that providing a vehicle for tax-deferred retirement savings though our 401(k) plan adds to the overall desirability of our executive compensation package and further incentivizes our employees, including our NEOs, in accordance with our compensation policies. 101 Table of Contents Executive Employment Arrangements Effective September 9, 2021, each of the NEOs entered into an employment agreement with Forge (the Initial Executive Agreements ). On February 25, 2022, Forge s compensation committee approved a modification to the agreement with Mr. Rodriques, which went into effect at Closing (the Rodriques Amendment ). The Initial Executive Agreements, as amended by the Rodriques Amendment in the case of the agreement with Mr. Rodriques, are referred to herein as the Executive Agreements . The Executive Agreements provide for each NEO s at-will employment and set forth, among other things, the applicable NEO s annual base salary and annual target cash bonus, each as described herein. In addition, each NEO is eligible to participate in the benefit plans and programs of Forge, subject to the terms and conditions of such plans. The Executive Agreements provide that the Company establish an incentive pool equal to 3.5% of the outstanding shares of the Company immediately following the closing of the Business Combination (the Incentive Pool ). The Initial Executive Agreements allocated the Incentive Pool as follows: 25% of the Incentive Pool to be paid in the form of cash bonuses ( Transaction Bonus Pool ) and 75% of the Incentive Pool to be paid in the form of restricted stock units ( Equity Bonus Pool ). The Rodriques Amendment reallocated $2,657,933 (the Cash Reallocation Amount ) of the Incentive Pool from the Equity Bonus Pool to the Transaction Bonus Pool for the payment of such Cash Reallocation Amount to Mr. Rodriques as part of his Transaction Bonus (as defined below) in order for the Company to make required tax withholding payments on Mr. Rodriques Transaction Bonus. Such Cash Reallocation Amount was deducted from the Retention Equity Grant (as defined below) from the Equity Bonus Pool that would otherwise have been due to Mr. Rodriques under his Initial Executive Agreement on a dollar-for-dollar basis. In connection with the Closing, each of the NEOs were eligible to receive a one-time cash payment from the Transaction Bonus Pool with Messrs. Rodriques, Lee and Cobos eligible to receive no less than $7,645,432, $2,756,250 and $2,625,000, respectively (each, a Transaction Bonus ). The amount payable to Mr. Rodriques as a Transaction Bonus included the Cash Reallocation Amount. Each NEO would have forfeited such bonuses in exchange for no consideration if the NEO s employment was terminated for any reason prior to the payment of such bonus. That said, the NEO would have been eligible to receive the unpaid portion of his cash bonus in the event his employment was terminated without cause (as defined in the respective Executive Agreement) prior to the closing of the Business Combination, subject to such NEO s execution and non-revocation of a release of claims. Notwithstanding the foregoing, immediately prior to the Business Combination, an applicable portion of each NEO s Transaction Bonus was used to reduce an amount necessary to offset certain outstanding promissory notes between the NEO and Forge. Each of the NEOs are also eligible to receive a grant of restricted stock units from the Equity Bonus Pool with Messrs. Rodriques, Lee and Cobos eligible to receive restricted stock units having values of at least $5,217,067, $3,937,500 and $3,937,500, respectively (each, a Retention Equity Grant ). The Retention Equity Grant to be made to Mr. Rodriques does not include the Cash Reallocation Amount. Each NEO s Retention Equity Grant vests, subject to the NEO s employment through the applicable vesting date, as follows: 33.33% of the Retention Equity Grant vests upon the first anniversary of the closing of the Business Combination (the First Tranche ); 33.33% of the Retention Equity Grant will vest upon the second anniversary of the closing of the Business Combination (the Second Tranche ); and 33.33% of the Retention Equity Grant will vest upon the third anniversary of the closing of the Business Combination (the Third Tranche ) (the Time-Vesting Schedule ). With respect to the grants made to Messrs. Rodriques, Lee and Cobos, the Retention Equity Grant becomes eligible to vest after the expiration of the six-month period following the closing of the Business Combination (the Lock-Up Period ) as follows: (i) the First Tranche will immediately vest if the Company s stock price meets or exceeds a price of $12.50 for 20 trading days within any 30 trading day period following the Lock-Up Period but prior to the vesting date of the First Tranche under the Time-Vesting Schedule, in which case the Second Tranche and Third Tranche will have their time-vesting component accelerated by six months; and (ii) the Second Tranche will immediately vest if the stock price meets or exceeds a closing price of $15.00 for 20 trading days within any 30 trading day period following the Lock-Up Period but prior to the vesting date of the Second Tranche under the Time-Vesting Schedule, in which case the Third Tranche will have its time-vesting component accelerated by an additional six months. The Retention Equity Grant will vest in accordance with such vesting provisions in the event the share price triggers are achieved through the date of a Sale Event of the Company (as defined in the 2022 Plan). Each NEO will forfeit such grant in exchange for no consideration in the event the Merger is not consummated or such NEO s employment is terminated for any reason prior to the grant of such restricted stock units. That said, the NEO would also have been eligible to receive 20% of the Retention Equity Grant on a fully-vested basis in the event his employment were terminated without cause (as defined in the respective Executive Agreement) prior to the closing of the Business Combination, subject to such NEO s execution and non-revocation of a release of claims. Each of the NEOs is also be eligible to receive severance payments and benefits in connection with a termination without cause or for good reason . In connection with such a termination, an NEO would be eligible to receive the following payments and benefits subject to his execution of a release and subject to not breaching any of his post-employment contractual obligations to Forge: (i) a lump sum payment equal to the sum of 12 months of the NEO s then-current base salary, any then-unpaid bonus from a prior 102 Table of Contents calendar year, and a pro rata target bonus for the year of termination at target level, (ii) company-paid COBRA premiums for the NEO and his eligible dependents for a period of 12 months following termination, and (iii) accelerated vesting with respect to the time-vesting requirements of 20% of any then unvested equity that had been granted prior to the date of termination (including, if applicable, the Retention Equity Grant). Each of the NEOs is also be eligible to receive enhanced severance payments and benefits if such a qualifying termination of employment occurs within six months prior to or 12 months following a Sale Event. In connection with such a termination, an NEO would be eligible to receive the following payments and benefits subject to his execution of a release and subject to not breaching any of his post-employment contractual obligations to Forge: (i) a lump sum payment equal to the sum of 18 months of the NEO s then-current base salary, any then-unpaid bonus from a prior calendar year, and a pro rata target bonus for the year of termination at target level, (ii) 100% of all unvested equity that had been granted prior to the date of termination (including, if applicable, the Retention Equity Grant) shall become fully vested and (iii) company-paid COBRA premiums for the NEO and his eligible dependents for a period of 18 months following termination. The occurrence of the closing of the Business Combination did not constitute a Sale Event. The foregoing descriptions of the Executive Agreements are not complete and are qualified in their entirety by reference to the complete text of each of the Initial Executive Agreements and the Rodriques Amendment, copies of which are incorporated herein by reference as Exhibits 10.5-10.8. Outstanding Equity Awards at 2021 Fiscal Year-End The following table sets forth information concerning outstanding equity awards held by each of the named executive officers as of December 31, 2021. Option Awards Stock Awards(7) Equity Incentive Plan Awards: Number of Number of Number of Securities Shares or Securities Underlying Units of Market Value of Underlying Unexercised Option Stock That Shares or Units of Unexercised Unearned Exercise Option Have Not Stock That Have Options (#) Options Price Expiration Vested Not Vested Name Grant Date Exercisable (#) ($) Date (#) ($) Kelly Rodriques 5/10/2018 (1) 780,733 202,500 (8) 6/4/2019 (2) 272,067 248,289 (8) 2/3/2021 (3) 520,490 266,667 (8) 5/11/2021 (4) 3,122,931 3.98 5/7/2026 Mark Lee 6/10/2019 (2) 165,818 151,326 (8) 8/11/2020 (2) 20,199 10,349 (8) 12/9/2020 (2) 227,715 116,667 (8) Jose Cobos 11/11/2019 (2) 427,829 219,194 (8) 8/11/2020 (2) 20,437 10,467 (8) 3/12/2021 (5) 187,376 96,000 (8) 3/12/2021 (6) 130,919 64,866 (8) 7/2/2021 (6) 315,416 1,713,970 (9) (1)The amount reported reflects the number of shares subject to a restricted stock award that remains subject to the Company s repurchase right. 1/4 of the shares vested on the one-year anniversary of the vesting commencement date, and 1/48 of the shares vest on a monthly basis each month thereafter, in each case, subject to the named executive officer s continuous service relationship with the Company through each applicable date. (2)The amounts reflect the number of shares issued upon the early exercise of a stock option grant that remain subject to the Company s repurchase right. 1/4 of the shares subject to the stock option vested or vest on the one-year anniversary of the vesting commencement date, and 1/48 of the shares vest on a monthly basis each month thereafter, in each case, subject to the named 103 Table of Contents executive officer s continuous service relationship with the Company through each applicable date. Notwithstanding the foregoing, each stock option grant includes double-trigger acceleration upon the named executive officer s involuntary termination of employment within a certain period of time before and after a change in control of the Company. (3)The amounts reflect the number of shares issued upon the early exercise of a stock option grant that remain subject to the Company s repurchase right. 1/60 of the shares vest on a monthly basis as Mr. Rodriques completes each month of continuous service after the vesting commencement date of January 19, 2021. In the event that this option or the underlying shares are assumed or continued by the Company or its successor entity in the sole discretion of the parties to a Corporate Transaction and thereafter remains in effect following such Corporate Transaction, each stock option grant includes double-trigger acceleration upon the named executive officer s involuntary termination of employment within a certain period of time before and after a change in control of the Company. (4)The amount reported reflects the number of shares subject to a nonqualified stock option with an exercise price of of $3.98. Upon a Corporate Transaction, and provided Mr. Rodriques is then serving as Chief Executive Officer of Forge, the option shall vest upon the achievement of certain Exit Proceeds and internal rate of return hurdles, in each case, as achieved by the Company s Series B-1 Preferred Stock in connection with such Corporation Transaction. (5)The amounts reflect the number of shares issued upon the early exercise of a stock option grant that remain subject to the Company s repurchase right. 1/4 of the shares subject to the stock option vest on the one-year anniversary of the vesting commencement date of March 1, 2021, and 1/48 of the shares vest on a monthly basis each month thereafter, in each case, subject to Mr. Cobos s continuous service relationship with the Company through each applicable date. (6)The amounts reflect the number of shares issued upon the early exercise of a stock option grant that remain subject to the Company s repurchase right. 1/48 of the shares vest on a monthly basis following the vesting commencement date, in each case, subject to Mr. Cobos s continuous service relationship with the Company through each applicable date. (7)Such equity awards are listed on a pre-conversion basis, and are subject to the terms of the 2018 Plan. The 2018 Plan was terminated in connection with the Closing and accordingly, no additional awards will be made under the 2018 Plan. (8)Based on the fair market value of a share of Forge s common stock on December 31, 2021, which was $1.60 on a pre-conversion basis. (9)Based on a strike price of $5.44. 104 Table of Contents DESCRIPTION OF CAPITAL STOCK The following summary of the material terms of our securities is not intended to be a complete summary of the rights and preferences of such securities, and is qualified by reference to the Certificate of Incorporation, the Bylaws and the warrant-related documents described herein, which are exhibits to the registration statement of which this prospectus is a part. We urge you to read each of the Certificate of Incorporation, the Bylaws and the warrant-related documents described herein in their entirety for a complete description of the rights and preferences of our securities. Authorized and Outstanding Stock The Certificate of Incorporation authorizes the issuance of 2,100,000,000 shares of capital stock, consisting of (i) 2,000,000,000 shares of common stock, par value $0.0001 per share and (ii) 100,000,000 shares of preferred stock, par value $0.0001 per share. The outstanding shares of the Company are duly authorized, validly issued, fully paid and non-assessable. Common Stock The Certificate of Incorporation authorizes the issuance of 2,000,000,000 shares of common stock, par value $0.0001 per share. As of May 17, 2022, there were issued and outstanding 169,223,826 shares of common stock. The Certificate of Incorporation provides that: The holders of common stock shall have the exclusive right to vote for the election of directors of the Company and on all other matters requiring stockholder action, each outstanding share entitling the holder thereof to one vote on each matter properly submitted to the stockholders of the Company for their vote; provided that such holders shall not be entitled to vote on any amendment to the Certificate of Incorporation (or on any amendment to a certificate of designations of any series of Preferred Stock) that alters or changes the powers, preferences, rights or other terms of one or more outstanding series of Preferred Stock if the holders of such affected series of Preferred Stock are entitled to vote, either separately or together with the holders of one or more other such series, on such amendment pursuant to the Certificate of Incorporation (or pursuant to a certificate of designations of any series of Preferred Stock); dividends may be declared and paid or set apart for payment upon common stock out of any assets or funds of the Company legally available for the payment of dividends, but only when and as declared by the Board or any authorized committee thereof; and upon the voluntary or involuntary liquidation, dissolution or winding up of the Company, the net assets of the Company shall be distributed pro rata to the holders of common stock. Preferred Stock The Certificate of Incorporation provides that shares of preferred stock may be issued from time to time in one or more series. The Board is authorized to fix the voting rights, if any, designations, powers, preferences and relative, participating, optional, special and other rights, if any, and any qualifications, limitations and restrictions thereof, applicable to the shares of each series. The Board is able, without stockholder approval, to issue preferred stock with voting and other rights that could adversely affect the voting power and other rights of the holders of common stock and could have anti-takeover effects. The ability of the Board to issue preferred stock without stockholder approval could have the effect of delaying, deferring or preventing a change of control of us or the removal of existing management. We have no preferred stock outstanding at the date hereof. Although we do not currently intend to issue any shares of preferred stock, we cannot assure you that we will not do so in the future. Warrants Public Warrants Each whole warrant entitles the registered holder to purchase one share of common stock at a price of $11.50 per share, subject to adjustment as discussed below, at any time commencing 30 days after the Closing Date, provided, in each case, that we have an effective registration statement under the Securities Act covering the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to them is available (or we permit holders to exercise their warrants on a cashless basis under the 105 Table of Contents circumstances specified in the warrant agreement) and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder. Pursuant to the warrant agreement, a warrant holder may exercise its warrants only for a whole number of shares of common stock. This means only a whole warrant may be exercised at a given time by a warrant holder. The warrants will expire five years after the Closing Date, at 5:00 p.m., New York City time, or earlier upon redemption or liquidation. We are not obligated to deliver any shares of common stock pursuant to the exercise of a warrant and have no obligation to settle such warrant exercise unless a registration statement under the Securities Act with respect to the shares of common stock underlying the warrants is then effective and a prospectus relating thereto is current, subject to our satisfying our obligations described below with respect to registration. No warrant will be exercisable and we will not be obligated to issue a share of common stock upon exercise of a warrant unless the share of common stock issuable upon such warrant exercise has been registered, qualified or deemed to be exempt under the securities laws of the state of residence of the registered holder of the warrants. In the event that the conditions in the two immediately preceding sentences are not satisfied with respect to a warrant, the holder of such warrant will not be entitled to exercise such warrant and such warrant may have no value and expire worthless. In no event will we be required to net cash settle any warrant. In the event that a registration statement is not effective for the exercised warrants, the purchaser of a unit containing such warrant will have paid the full purchase price for the unit solely for the share of common stock underlying such unit. If a registration statement covering the shares of common stock issuable upon exercise of the warrants is not effective by the 60th business day after the Closing Date, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption. Notwithstanding the above, if our shares of common stock are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a covered security under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of public warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement, and in the event we do not so elect, we will use our commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. In such event, each holder would pay the exercise price by surrendering each such warrant for that number of shares of common stock equal to the lesser of (A) the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied the excess of the fair market value less the exercise price of the warrants by (y) the fair market value and (B) 0.361 shares per whole warrant. The fair market value shall mean the volume-weighted average price of the shares of common stock during the 10 trading days ending on the trading day prior to the date on which the notice of exercise is received by the warrant agent. Redemption of Warrants When the Price per Share Equals or Exceeds $18.00 Once the warrants become exercisable, we may redeem the outstanding warrants (except as described herein with respect to the private placement warrants): in whole and not in part; at a price of $0.01 per warrant; upon not less than 30 days prior written notice of redemption (the 30-day redemption period ) to each warrant holder; and if, and only if, the last reported sale price of the shares of common stock for any 20 trading days within a 30-trading day period ending three trading days before we send the notice of redemption to the warrant holders (the Reference Value ) equals or exceeds $18.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like). If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. However, we will not redeem the warrants unless an effective registration statement under the Securities Act covering the shares of common stock issuable upon exercise of the warrants is effective and a current prospectus relating to those shares of common stock is available throughout the 30-day redemption period. We have established the last of the redemption criteria discussed above to prevent a redemption call unless there is at the time of the call a significant premium to the warrant exercise price. If the foregoing conditions are satisfied and we issue a notice of redemption of the warrants, each warrant holder will be entitled to exercise his, her or its warrant prior to the scheduled redemption 106 Table of Contents date. Any such exercise would not be done on a cashless basis and would require the exercising warrant holder to pay the exercise price for each warrant being exercised. However, the price of the shares of common stock may fall below the $18.00 redemption trigger price (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like) as well as the $11.50 (for whole shares) warrant exercise price after the redemption notice is issued. Redemption of Warrants When the Price per Share Equals or Exceeds $10.00 Once the warrants become exercisable, we may redeem the outstanding warrants: in whole and not in part; at $0.10 per warrant upon a minimum of 30 days prior written notice of redemption; provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined by reference to the table below, based on the redemption date and the fair market value of our shares of common stock (as defined below); if, and only if, the Reference Value (as defined above under Redemption of Warrants When the Price per Share Equals or Exceeds $18.00 ) equals or exceeds $10.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like); and if the Reference Value is less than $18.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like) the private placement warrants must also be concurrently called for redemption on the same terms as the outstanding public warrants, as described above. The numbers in the table below represent the number of shares of common stock that a warrant holder will receive upon exercise in connection with a redemption by us pursuant to this redemption feature, based on the fair market value of our shares of common stock on the corresponding redemption date (assuming holders elect to exercise their warrants and such warrants are not redeemed for $0.10 per warrant), determined based on volume-weighted average price of our shares of common stock for the 10 trading days immediately following the date on which the notice of redemption is sent to the holders of warrants, and the number of months that the corresponding redemption date precedes the expiration date of the warrants, each as set forth in the table below. We will provide our warrant holders with the final fair market value no later than one business day after the 10 trading day period described above ends. The share prices set forth in the column headings of the table below will be adjusted as of any date on which the number of shares issuable upon exercise of a warrant or the exercise price of the warrant is adjusted as set forth under the heading Anti-dilution Adjustments below. If the number of shares issuable upon exercise of a warrant is adjusted, the adjusted share prices in the column headings will equal the share prices immediately prior to such adjustment, multiplied by a fraction, the numerator of which is the exercise price of the warrant after such adjustment and the denominator of which is the price of the warrant immediately prior to such adjustment. In such an event, the number of shares in the table below shall be adjusted by multiplying such share amounts by a fraction, the numerator of which is the number of shares deliverable upon exercise of a warrant immediately prior to such adjustment and the denominator of which is the number of shares deliverable upon exercise of a warrant as so adjusted. If the exercise price of the warrant is adjusted as a result of raising capital in connection with the Business Combination, the adjusted share prices in the column 107 Table of Contents headings will by multiplied by a fraction, the numerator of which is the higher of the Market Value and the Newly Issued Price as set forth under the heading Anti-dilution Adjustments and the denominator of which is $10.00. Fair Market Value of Common Stock Redemption Date (period to expiration of warrants) $10.00 $11.00 $12.00 $13.00 $14.00 $15.00 $16.00 $17.00 $18.00 60 months 0.261 0.281 0.297 0.311 0.324 0.337 0.348 0.358 0.361 57 months 0.257 0.277 0.294 0.310 0.324 0.337 0.348 0.358 0.361 54 months 0.252 0.272 0.291 0.307 0.322 0.335 0.347 0.357 0.361 51 months 0.246 0.268 0.287 0.304 0.320 0.333 0.346 0.357 0.361 48 months 0.241 0.263 0.283 0.301 0.317 0.332 0.344 0.356 0.361 45 months 0.235 0.258 0.279 0.298 0.315 0.330 0.343 0.356 0.361 42 months 0.228 0.252 0.274 0.294 0.312 0.328 0.342 0.355 0.361 39 months 0.221 0.246 0.269 0.290 0.309 0.325 0.340 0.354 0.361 36 months 0.213 0.239 0.263 0.285 0.305 0.323 0.339 0.353 0.361 33 months 0.205 0.232 0.257 0.280 0.301 0.320 0.337 0.352 0.361 30 months 0.196 0.224 0.250 0.274 0.297 0.316 0.335 0.351 0.361 27 months 0.185 0.214 0.242 0.268 0.291 0.313 0.332 0.350 0.361 24 months 0.173 0.204 0.233 0.260 0.285 0.308 0.329 0.348 0.361 21 months 0.161 0.193 0.223 0.252 0.279 0.304 0.326 0.347 0.361 18 months 0.146 0.179 0.211 0.242 0.271 0.298 0.322 0.345 0.361 15 months 0.130 0.164 0.197 0.230 0.262 0.291 0.317 0.342 0.361 12 months 0.111 0.146 0.181 0.216 0.250 0.282 0.312 0.339 0.361 9 months 0.090 0.125 0.162 0.199 0.237 0.272 0.305 0.336 0.361 6 months 0.065 0.099 0.137 0.178 0.219 0.259 0.296 0.331 0.361 3 months 0.034 0.065 0.104 0.150 0.197 0.243 0.286 0.326 0.361 0 months 0.042 0.115 0.179 0.233 0.281 0.323 0.361 The exact fair market value and redemption date may not be set forth in the table above, in which case, if the fair market value is between two values in the table or the redemption date is between two redemption dates in the table, the number of shares of common stock to be issued for each warrant exercised will be determined by a straight-line interpolation between the number of shares set forth for the higher and lower fair market values and the earlier and later redemption dates, as applicable, based on a 365 or 366 day year, as applicable. For example, if the volume-weighted average price of our shares of common stock for the 10 trading days immediately following the date on which the notice of redemption is sent to the holders of the warrants is $11.00 per share, and at such time there are 57 months until the expiration of the warrants, holders may choose to, in connection with this redemption feature, exercise their warrants for 0.277 shares of common stock for each whole warrant. For an example where the exact fair market value and redemption date are not as set forth in the table above, if the volume-weighted average price of our shares of common stock for the 10 trading days immediately following the date on which the notice of redemption is sent to the holders of the warrants is $13.50 per share, and at such time there are 38 months until the expiration of the warrants, holders may choose to, in connection with this redemption feature, exercise their warrants for 0.298 shares of common stock for each whole warrant. In no event will the warrants be exercisable in connection with this redemption feature for more than 0.361 shares of common stock per warrant (subject to adjustment). This redemption feature is structured to allow for all of the outstanding warrants to be redeemed when the shares of common stock are trading at or above $10.00 per share, which may be at a time when the trading price of our shares of common stock is below the exercise price of the warrants. We have established this redemption feature to provide us with the flexibility to redeem the warrants without the warrants having to reach the $18.00 per share threshold set forth above under Redemption of Warrants When the Price per Share Equals or Exceeds $18.00. Holders choosing to exercise their warrants in connection with a redemption pursuant to this feature will, in effect, receive a number of shares for their warrants based on an option pricing model with a fixed volatility input as of the date of the prospectus for Motive s initial public offering. This redemption right provides us with an additional mechanism by which to redeem all of the outstanding warrants, and therefore have certainty as to our capital structure as the warrants would no longer be outstanding and would have been exercised or redeemed. We will be required to pay the applicable redemption price to warrant holders if we choose to exercise this redemption right and it will allow us to quickly proceed with a redemption of the warrants if we determine it is in our best interest to do so. As such, we would redeem the warrants in this manner when we believe it is in our best interest to update our capital structure to remove the warrants and pay the redemption price to the warrant holders. As stated above, we can redeem the warrants when the shares of common stock are trading at a price starting at $10.00, which is below 108 Table of Contents the exercise price of $11.50, because it will provide certainty with respect to our capital structure and cash position while providing warrant holders with the opportunity to exercise their warrants on a cashless basis for the applicable number of shares. If we choose to redeem the warrants when the shares of common stock are trading at a price below the exercise price of the warrants, this could result in the warrant holders receiving fewer shares of common stock than they would have received if they had chosen to wait to exercise their warrants for shares of common stock if and when such shares of common stock were trading at a price higher than the exercise price of $11.50. No fractional shares of common stock will be issued upon exercise. If, upon exercise, a holder would be entitled to receive a fractional interest in a share, we will round down to the nearest whole number of the number of shares of common stock to be issued to the holder. If, at the time of redemption, the warrants are exercisable for a security other than the shares of common stock pursuant to the warrant agreement, the warrants may be exercised for such security. At such time as the warrants become exercisable for a security other than the shares of common stock, Forge will use its commercially reasonable efforts to register under the Securities Act the security issuable upon the exercise of the warrants. If the shares of common stock issuable upon exercise of the warrants are not registered under the Securities Act, under the terms of the warrant agreement, holders of warrants who seek to exercise their warrants will not be permitted to do so for cash and, instead, will be required to do so on a cashless basis, in which case the number of shares of common stock that the holders of warrants will receive upon cashless exercise will be based on a formula subject to a maximum number of shares equal to 0.361 shares of common stock per warrant (subject to adjustment). Redemption Procedures. A holder of a warrant may notify us in writing in the event it elects to be subject to a requirement that such holder will not have the right to exercise such warrant, to the extent that after giving effect to such exercise, such person (together with such person s affiliates), to the warrant agent s actual knowledge, would beneficially own in excess of 4.9% or 9.8% (as specified by the holder) of the shares of common stock outstanding immediately after giving effect to such exercise. Anti-dilution Adjustments. If the number of outstanding shares of common stock is increased by a share capitalization payable in shares of common stock, or by a split-up of shares or other similar event, then, on the effective date of such share capitalization, split-up or similar event, the number of shares of common stock issuable on exercise of each warrant will be increased in proportion to such increase in the outstanding shares. A rights offering made to all or substantially all holders of shares entitling holders to purchase shares of common stock at a price less than the historical fair market value (as defined below) will be deemed a share capitalization of a number of shares of common stock equal to the product of (i) the number of shares of common stock actually sold in such rights offering (or issuable under any other equity securities sold in such rights offering that are convertible into or exercisable for shares of common stock) and (ii) one minus the quotient of (x) the price per share of common stock paid in such rights offering and (y) the historical fair market value. For these purposes (i) if the rights offering is for securities convertible into or exercisable for shares of common stock, in determining the price payable for shares of common stock, there will be taken into account any consideration received for such rights, as well as any additional amount payable upon exercise or conversion and (ii) historical fair market value means the volume-weighted average price of shares of common stock during the 10 trading day period ending on the trading day prior to the first date on which the shares of common stock trade on the applicable exchange or in the applicable market, regular way, without the right to receive such rights. In addition, if we, at any time while the warrants are outstanding and unexpired, pay a dividend or make a distribution in cash, securities or other assets to all or substantially all the holders of shares of common stock on account of such shares of common stock (or other securities into which the warrants are convertible), other than (a) as described above or (b) certain ordinary cash dividends, then the warrant exercise price will be decreased, effective immediately after the effective date of such event, by the amount of cash and/or the fair market value of any securities or other assets paid on each share of common stock in respect of such event. If the number of outstanding shares of common stock is decreased by a consolidation, combination, reverse share split or reclassification of shares of common stock or other similar event, then, on the effective date of such consolidation, combination, reverse share split, reclassification or similar event, the number of shares of common stock issuable on exercise of each warrant will be decreased in proportion to such decrease in outstanding shares of common stock. Whenever the number of shares of common stock purchasable upon the exercise of the warrants is adjusted, as described above, the warrant exercise price will be adjusted by multiplying the warrant exercise price immediately prior to such adjustment by a fraction (x) the numerator of which will be the number of shares of common stock purchasable upon the exercise of the warrants immediately prior to such adjustment, and (y) the denominator of which will be the number of shares of common stock so purchasable immediately thereafter. 109 Table of Contents In case of any reclassification or reorganization of the outstanding shares of common stock (other than those described above or that solely affects the par value of such shares of common stock), or in the case of any merger or consolidation of us with or into another corporation (other than a consolidation or merger in which we are the continuing corporation and that does not result in any reclassification or reorganization of our issued and outstanding shares of common stock), or in the case of any sale or conveyance to another corporation or entity of the assets or other property of us as an entirety or substantially as an entirety in connection with which we are dissolved, the holders of the warrants will thereafter have the right to purchase and receive, upon the basis and upon the terms and conditions specified in the warrants and in lieu of the shares of common stock immediately theretofore purchasable and receivable upon the exercise of the rights represented thereby, the kind and amount of shares of common stock or other securities or property (including cash) receivable upon such reclassification, reorganization, merger or consolidation, or upon a dissolution following any such sale or transfer, that the holder of the warrants would have received if such holder had exercised their warrants immediately prior to such event. If less than 70% of the consideration receivable by the holders of shares of common stock in such a transaction is payable in the form of shares of common stock in the successor entity that is listed for trading on a national securities exchange or is quoted in an established over-the-counter market, or is to be so listed for trading or quoted immediately following such event, and if the registered holder of the warrant properly exercises the warrant within 30 days following public disclosure of such transaction, the warrant exercise price will be reduced as specified in the warrant agreement based on the Black-Scholes Warrant Value (as defined in the warrant agreement) of the warrant. The purpose of such exercise price reduction is to provide additional value to holders of the warrants when an extraordinary transaction occurs during the exercise period of the warrants pursuant to which the holders of the warrants otherwise do not receive the full potential value of the warrants. The warrants were issued in registered form under a warrant agreement between Continental Stock Transfer & Trust Company, as warrant agent, and us. The warrant agreement provides that the terms of the warrants may be amended without the consent of any holder for the purpose of (i) curing any ambiguity or correct any mistake or defective provision (ii) amending the provisions relating to cash dividends on shares as contemplated by and in accordance with the warrant agreement or (iii) adding or changing any provisions with respect to matters or questions arising under the warrant agreement as the parties to the warrant agreement may deem necessary or desirable and that the parties deem to not adversely affect the rights of the registered holders of the warrants, provided that the approval by the holders of at least 50% of the then-outstanding public warrants is required to make any change that adversely affects the interests of the registered holders of the public warrants and the approval of holders of at least 50% of the warrants is required to make any change that adversely affects the interests of the holders of the warrants. The warrants may be exercised upon surrender of the warrant certificate on or prior to the expiration date at the offices of the warrant agent, with the exercise form on the reverse side of the warrant certificate completed and executed as indicated, accompanied by full payment of the exercise price (or on a cashless basis, if applicable), by certified or official bank check payable to us, for the number of warrants being exercised. The warrant holders do not have the rights or privileges of holders of shares and any voting rights until they exercise their warrants and receive shares of common stock. After the issuance of shares of common stock upon exercise of the warrants, each holder will be entitled to one vote for each share held of record on all matters to be voted on by shareholders. No fractional shares will be issued upon exercise of the warrants. If, upon exercise of the warrants, a holder would be entitled to receive a fractional interest in a share, we will, upon exercise, round down to the nearest whole number, the number of shares of common stock to be issued to the warrant holder. Our warrant agreement provides that, subject to applicable law, any action, proceeding or claim against us arising out of or relating in any way to the warrant agreement will be brought and enforced in the courts of the State of New York or the United States District Court for the Southern District of New York, and we irrevocably submit to such jurisdiction, which jurisdiction will be the exclusive forum for any such action, proceeding or claim. Our warrant agreement further provides that this provision does not apply to (1) suits brought to enforce any liability or duty created by the Exchange Act or (2) any other claim for which the federal district courts of the United States of America are the sole and exclusive forum. While this provision of the Warrant Agreement does not explicitly reference suits brought to enforce a duty or liability under the Securities Act ( Securities Act Claims ), because the federal district courts of the United States are not by law the sole and exclusive forum with respect to Securities Act Claims, the exclusion described in clause (2) above does not apply to such claims. Therefore, we expect that this provision of the Warrant Agreement would apply to Securities Act Claims and, taken together with clause (b) of the exclusive forum provision contained in the Bylaws (which directs Securities Act Claims to the federal district courts of the United States of America), would seek to require that Securities Act Claims related to the Warrant Agreement be brought in the United States District Court for the Southern District of New York. We note that there is uncertainty as to whether a court would enforce this provision of the Warrant Agreement. Private Placement Warrants The private placement warrants (including the shares of common stock issuable upon exercise of such warrants) are not transferable, assignable or salable until 30 days after the Closing Date (except, among other limited exceptions, to our officers and 110 Table of Contents directors and persons or entities affiliated with our Sponsor) and they will not be redeemable by us (except as described under Redemption of Warrants When the Price per Share Equals or Exceeds $10.00 ) so long as they are held by our Sponsor, members of our Sponsor or their permitted transferees. The Sponsor or its permitted transferees, have the option to exercise the private placement warrants on a cashless basis. Except as described below, the private placement warrants have terms and provisions that are identical to the public warrants. If the private placement warrants are held by holders other than the Sponsor or its permitted transferees, the private placement warrants will be redeemable by us and exercisable by the holders on the same basis as the public warrants. Except as described under Redemption of Warrants When the Price per Share Equals or Exceeds $10.00, if holders of the private placement warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering his, her or its warrants for that number of shares of common stock equal to the quotient obtained by dividing (x) the product of the number of shares of common stock underlying the warrants, multiplied by the excess of the sponsor fair market value of our shares of common stock (defined below) over the exercise price of the warrants by (y) the fair market value. For these purposes, the sponsor fair market value will mean the average reported closing price of the shares of common stock during the 10 trading days ending on the third trading day prior to the date on which the notice of warrant exercise is sent to the warrant agent. Lock-Up Restrictions Our Bylaws provide for additional restrictions on the sale or transfer of the shares of common stock (including shares issuable upon exercise of assumed warrants and assumed options of Forge) by the former Forge equityholders received in the Merger for a 180-day period following the Closing. Additionally, pursuant to the Sponsor Support Agreement, the Sponsor also has agreed to certain transfer restrictions with respect to the Sponsor Lockup Securities as follows: (a) one-third of the Lockup shares will be subject to a one year lock-up, and will be released from such lock-up if the closing price of our common stock equals or exceeds $12.00 for any 20 trading days in a 30-consecutive trading day period commencing 150 days post-Closing, (b) one-third of the Lockup warrants will be subject to a six month lock-up, (c) one-third of the Sponsor Lockup Securities will be subject to a three year lock-up, and will be released from such lock-up no earlier than six months after the Closing if the closing price our common stock equals or exceeds $12.50 for any 20 trading days in a 30-consecutive trading day period post-Closing, and (d) one-third of the Sponsor Lockup Securities will be subject to a three year lock-up, and will be released from such lock-up no earlier than six months after the Closing if the closing price our common stock equals or exceeds $15.00 for any 20 trading days in a 30-consecutive trading day period post-Closing. Dividends Under the Certificate of Incorporation, holders of common stock are entitled to receive ratable dividends, if any, as may be declared from time-to-time by our Board out of legally available assets or funds. There are no current plans to pay cash dividends on common stock for the foreseeable future. Voting Power Except as otherwise required by law or as otherwise provided in any certificate of designation for any series of preferred stock, under the current certificate of incorporation and the Certificate of Incorporation, the holders of common stock possess or will possess, as applicable, all voting power for the election of our directors and all other matters requiring stockholder action and are entitled or will be entitled, as applicable, to one vote per share on matters to be voted on by stockholders. Subject to certain limited exceptions, the holders of common stock shall at all times vote together as one class on all matters submitted to a vote of the holders of common stock under the Certificate of Incorporation. Preemptive or Other Rights The Certificate of Incorporation does not provide for any preemptive or other similar rights. Election of Directors Our Board currently consists of eight (8) directors. Under the terms of the Certificate of Incorporation, the Board is divided into three classes designated as Class I, Class II and Class III. Class I directors will initially serve for a term expiring at the first annual meeting of stockholders following the Closing Date. Class II and Class III directors will initially serve for a term expiring at the second and third annual meeting of stockholders following the Closing Date, respectively. At each succeeding annual meeting of 111 Table of Contents stockholders, directors will be elected for a full term of three years to succeed the directors of the class whose terms expire at such annual meeting of the stockholders. There will be no limit on the number of terms a director may serve on the Board. Under the Certificate of Incorporation, directors are elected by a plurality voting standard, whereby each of our stockholders may not give more than one vote per share towards any one director nominee. There are no cumulative voting rights. Annual Stockholder Meetings Annual stockholder meetings will be held at a date, time and place, if any, as exclusively selected by our Board. To the extent permitted under applicable law, Forge may conduct meetings by means of remote communication. Dissenters Rights of Appraisal and Payment Under the DGCL, with certain exceptions, Forge s stockholders have appraisal rights in connection with a merger or consolidation of Forge. Pursuant to the DGCL, stockholders who properly request and perfect appraisal rights in connection with such merger or consolidation will have the right to receive payment of the fair value of their shares as determined by the Delaware Court of Chancery. Stockholders Derivative Actions Under the DGCL, any of Forge s stockholders may bring an action in Forge s name to procure a judgment in Forge s favor, also known as a derivative action, provided that the stockholder bringing the action is a holder of Forge s shares at the time of the transaction to which the action relates or such stockholder s stock thereafter devolved by operation of law. Limitations on Liability and Indemnification of Officers and Directors The Governing Documents provide for the indemnification of current and former officers and directors of Forge to the fullest extent permitted by Delaware law. We have entered into agreements with our officers and directors to provide contractual indemnification in addition to the indemnification provided for in our current certificate of incorporation. We have purchased a policy of directors and officers liability insurance that insures our officers and directors against the cost of defense, settlement or payment of a judgment in some circumstances and insures us against our obligations to indemnify our officers and directors. In connection with the Closing, the Company purchased a tail policy with respect to liability coverage for the benefit of our current officers and directors on the same or substantially similar terms of our existing policy. Pursuant to the Merger Agreement, Forge will maintain such tail policy for a period of no less than six years following the Closing. These provisions may discourage current shareholders and future stockholders from bringing a lawsuit against our directors for breach of their fiduciary duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against officers and directors, even though such an action, if successful, might otherwise benefit us and our shareholders and stockholders. Furthermore, a shareholder s or stockholder s investment may be adversely affected to the extent we pay the costs of settlement and damage awards against officers and directors pursuant to these indemnification provisions. We believe that these provisions, the directors and officers liability insurance and the indemnity agreements are necessary to attract and retain talented and experienced officers and directors. Certain Anti-Takeover Provisions of Delaware Law; Forge s Certificate of Incorporation and Bylaws Our Certificate of Incorporation and Bylaws contain and the DGCL contains provisions, as summarized in the following paragraphs that are intended to enhance the likelihood of continuity and stability in the composition of our Board. These provisions are intended to avoid costly takeover battles, reduce Forge s vulnerability to a hostile change of control and enhance the ability of our Board to maximize stockholder value in connection with any unsolicited offer to acquire Forge. However, these provisions may have an anti-takeover effect and may delay, deter, or prevent a merger or acquisition of Forge by means of a tender offer, a proxy contest or other takeover attempt that a stockholder might consider in its best interest, including those attempts that might result in a premium over the prevailing market price for the shares of common stock held by stockholders. 112 Table of Contents Exclusive Forum The Governing Documents stipulate that, to the fullest extent permitted by law, unless Forge consents in writing to an alternative forum, (a) the Delaware Court of Chancery (or, if such court does not have, or declines to accept, jurisdiction, another state court or a federal court located in Delaware) will be the exclusive forum for any complaint asserting any internal corporate claims, including claims in the right of Forge based upon a violation of a duty by a current or former director, officer, employee or stockholder in such capacity, or as to which the Delaware General Corporation Law confers jurisdiction upon the Court of Chancery, and (b) the federal district courts of the United States of America will be the exclusive forum for any complaint asserting a cause of action arising under the Securities Act. The choice of forum provision is intended to apply to the fullest extent permitted by law to the above-specified types of actions and proceedings, including any derivative actions asserting claims under state law or the federal securities laws, and is intended to require, in each case, to the fullest extent permitted by law, that (i) any Securities Act claims be brought in the federal district courts of the United States in accordance with clause (b) of the choice of forum provision and (ii) suits brought to enforce any duty or liability created by the Exchange Act be brought in the United States District Court for the District of Delaware. The provision does not apply to any direct claims brought by Forge s shareholders on their own behalf, or on behalf of any class of similarly situated shareholders, under the Securities Exchange Act. Advance Notice of Director Nominations and New Business We have established advance notice requirements for nominations for elections to our Board or for proposing matters that can be acted upon by shareholders at shareholder meetings. Listing of Securities The common stock and public warrants are listed on the NYSE under the symbols FRGE and FRGE WS , respectively. Registration Rights At the Closing, Forge entered into the Amended and Restated Registration Rights Agreement, pursuant to which, among other things, the Sponsor, the stockholders party thereto and Forge have specified rights to require Forge to register all or a portion of their shares of common stock under the Securities Act. The registration statement of which this prospectus forms a part has been filed to satisfy Forge s obligations under the Amended and Restated Registration Rights Agreement. 113 Table of Contents SECURITIES ACT RESTRICTIONS ON RESALE OF SECURITIES Resales under Rule 144 Under the Securities Act, securities may be sold only if the sale is registered under the Securities Act or qualifies for an exemption from registration, including an exemption under Rule 144 under the Securities Act ( Rule 144 ). Rule 144(b)(1) provides a safe harbor pursuant to which certain persons may sell shares of common stock or warrants that constitute restricted securities as defined in Rule 144 without registration under the Securities Act. Restricted securities include, among other things, securities acquired directly or indirectly from the issuer, or from an affiliate of the issuer, in a transaction or chain of transactions not involving any public offering. In general, the conditions that must be met for a person to sell securities pursuant to Rule 144(b)(1) are as follows: (i) the person selling the shares must not be an affiliate of ours at the time of the sale, and must not have been an affiliate of ours during the preceding three months, and (2) either (A) at least one year must have elapsed since the date of acquisition of the restricted securities from us or any of its affiliates or (B) if we satisfies the current public information requirements set forth in Rule 144, at least six months have elapsed since the date of acquisition of the restricted securities from us or any of its affiliates. Rule 144(b)(2) provides a safe harbor pursuant to which persons who are affiliates of ours may sell shares of its stock, whether restricted securities or not, without registration under the Securities Act if certain conditions are met. In general, the conditions that must be met for a person who is an affiliate of ours (or has been within three months prior to the date of sale) to sell shares of stock of ours pursuant to Rule 144(b)(2) are as follows (1) if the shares being sold are restricted securities, at least six months must have elapsed since the date of acquisition of the shares of stock from us or any of its affiliates, (2) the seller must comply with volume limitations, manner of sale restrictions and notice requirements and (3) we must satisfy the current public information requirements set forth in Rule 144. In order to comply with the volume limitations, a seller may not sell, in any three month period, more than the following number of shares: 1.0% of the shares of our common stock then outstanding as shown by the most recent report or statement published by us; the average weekly reported volume of trading in our common stock on all national securities exchanges and/or reported through the automated quotation system of a registered securities association during the four calendar weeks preceding the filing of the notice required to be filed by the seller under Rule 144 or if no such notice is required, the date of receipt of the order to execute the transaction by the broker or the date of execution of the transaction directly with a market maker; or the average weekly volume of trading in such securities reported pursuant to an effective transaction report plan or an effective national market system plan, as defined in Regulation NMS under the Exchange Act, during the four week period described in the preceding bullet. Restrictions on the Use of Rule 144 by Shell Companies or Former Shell Companies Rule 144 is not available for the resale of securities initially issued by shell companies (other than business combination related shell companies) or issuers that have been at any time previously a shell company unless the following conditions are met: the issuer of the securities that was formerly a shell company has ceased to be a shell company; the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act; the issuer of the securities has filed all Exchange Act reports and material required to be filed, as applicable, during the preceding twelve months (or such shorter period that the issuer was required to file such reports and materials), other than Form 8-K reports; and at least one year has elapsed from the time that the issuer filed current Form 10 type information with the SEC reflecting its status as an entity that is not a shell company. We are no longer a shell company, and as a result, once the conditions set forth in the exceptions listed above are satisfied, Rule 144 will become available for the resale of shares of common stock. 114 Table of Contents Rule 145 The shares of common stock to be issued to certain persons or entities pursuant to the registration statement of which this prospectus forms a part will be subject to the provisions of Rule 145 under the Securities Act ( Rule 145 ). Under Rule 145, a person or entity that is an affiliate of a party to a merger, acquisition or reclassification (the merger ) at the time they are submitted for vote or consent is deemed to be an underwriter in connection with any transaction to publicly offer or sell securities acquired in the merger unless the following conditions are met: the conditions set forth under Restrictions on the Use of Rule 144 by Shell Companies or Former Shell Companies are met; and either (i) the sale occurs at least 90 days after the securities were acquired in the merger and the conditions applicable to resales under Rule 144(b)(2), other than the notice requirement, are satisfied or (ii) for a person who is not an affiliate of ours on the date of sale (and has not been an affiliate of ours within three months prior to the date of sale), either (A) at least one year has elapsed since the securities were acquired in the merger or (B) if we satisfy the current public information requirements set forth in Rule 144, at least six months have elapsed since the securities were acquired in the merger. Securities subject to Rule 145 may be resold pursuant to a registration statement registering their resale which is also registering the resales of the securities acquired in the merger. 115 Table of Contents PRINCIPAL STOCKHOLDERS The following table sets forth information regarding, unless otherwise indicated in the footnotes below, the actual beneficial ownership of common stock as of May 17, 2022 (the Ownership Date ) by: each person who is the beneficial owner of more than 5% of the issued and outstanding shares of common stock; each of Forge s current named executive officers and directors; and all current executive officers and directors of Forge as a group. Beneficial ownership is determined according to SEC rules, which generally provide that a person has beneficial ownership of a security if he, she or it possesses sole or shared voting or investment power over that security, including options and warrants that are currently exercisable or exercisable within 60 days. The beneficial ownership of common stock is based on 169,223,826 shares of common stock outstanding as of the Ownership Date. The ownership percentages listed below do not include any shares of common stock that may be issued after the Ownership Date. Name of Beneficial Owner Number of shares of Common Stock Beneficially Owned % Directors and Executive Officers of Forge Blythe Masters(1) Ashwin Kumar(1) Kelly Rodriques(2) 7,956,983 4.70 % Mark Lee(3) 1,212,453 * Jose Cobos(4) 1,364,604 * Stephen George(9) 4,453,685 2.63 % Christoph Hansmeyer(5)(7) 62,458 * Kimberly Vogel James Herbert, II (10) 575,039 * Steven McLaughlin(8) 5,940,915 3.51 % All Directors and Executive Officers of Forge as a Group (9 Individuals) 20,991,098 12.38 % Five Percent Holders: Paul Luc Robert Heyvaert and Entities Affiliated with Motive Partners (6) 36,283,331 20.01 % Deutsche Borse AG (7) 24,262,496 14.33 % Temasek Holding (Private) Limited (11) 8,607,712 5.1 % * = less than 1% (1)Does not include any shares indirectly owned by this individual as a result of the individual s profits interest in the Sponsor. Each of these individuals disclaims beneficial ownership of any shares except to the extent of their pecuniary interest therein. (2)Includes (i) 1,135,371 shares of common stock subject to vesting restrictions, (ii) 66,945 shares of common stock held indirectly through an IRA, (iii) 3,834 warrants to purchase common stock exercisable within 60 days that are directly held and (iv) 6,277 warrants to purchase common stock exercisable within 60 days held indirectly through an IRA. Does not include options to purchase 3,122,931 shares of common stock subject to performance vesting conditions. Also includes (i) 677,733 shares of common stock held by Operative Capital LP ( Operative LP ), (ii) 25,083 warrants to purchase common stock exercisable within 60 days held by Operative LP and (iii) 1,596,734 shares of common stock held by Operative Capital SPV I, LLC ( Operative SPV 1 ). Mr. Rodriques is a managing member of the ultimate general partner of each of Operative Capital LP and Operative Capital SPV I, LLC and thus may be deemed to be the beneficial owner of the shares held 116 Table of Contents by such entities. Mr. Rodriques disclaims beneficial ownership of all securities held by Operative LP and Operative SPV 1 except to the extent of his pecuniary interest therein, if any. (3) Includes 1,205,146 shares of common stock (including 338,406 shares of common stock subject to vesting restrictions) and 7,307 warrants to purchase common stock exercisable within 60 days. (4) Includes 1,090,485 shares of common stock (including 647,241 shares of common stock subject to vesting restrictions) and 86,745 stock options exercisable within 60 days held by Mr. Cobos. Also includes 93,687 shares of common stock held by the Elizabeth G. Cobos 2021 Annuity Trust and 93,687 shares of common stock held by the Jose Cobos 2021 Annuity Trust. (5) Includes 62,458 stock options exercisable within 60 days. (6) Includes (i) 1,995,820 shares of common stock and warrants to purchase 665,273 shares of common stock held by Motive Capital Fund I-A, LP ( MC Fund I-A ), (ii) 2,526,551 shares of common stock and warrants to purchase 842,183 shares of common stock held by Motive Capital Fund I-B, LP ( MC Fund I-B ), (iii) 144,296 shares of common stock and warrants to purchase 48,098 common stock held by Motive Capital Fund I-MPF, LP ( MC Fund I-MPF ), (iv) 9,333,333 shares of common stock and warrants to purchase 3,111,110 shares of common stock held directly by MCF2 FG Aggregator, LLC ( MCF2 FG Aggregator ) and (vii) 10,230,000 shares of common stock and warrants to purchase 7,386,667 shares of common stock held by the Sponsor. The members of MCF2 FG Aggregator are Motive Capital Fund II-A, LP ( MC Fund II-A ), Motive Capital Fund II-B, LP ( MC Fund II-B ) and Motive Capital Fund II-MPF, LP ( MC Fund II-MPF ). The general partner of MC Fund I-A, MC Fund I-B and MC Fund I-MPF is Motive Capital Fund I GP, LP ( MC-I General Partner ). The manager of MCF2 FG Aggregator is Motive Capital Fund II GP, LP ( MC-II General Partner ). The general partner of MC Fund II-A, MC Fund II-B and MC Fund II-MPF is MC-II General Partner. The general partner of MC-I General Partner and MC-II General Partner and the manager of Sponsor is Motive Partners GP, LLC ( Manager ). The sole member of the Manager is Rob Exploration, LLC ( Exploration ), of which Paul Luc Robert Heyvaert is the sole member. Each of MC Fund II-A, MC Fund II-B, MC Fund II-MPF, MC-I General Partner, MC-II General Partner, Manager, Exploration and Paul Luc Robert Heyvaert may be deemed to have beneficial ownership of the shares of common stock and warrants reported herein to the extent of their pecuniary interests therein. The address of the entities listed herein and Mr. Heyvaert is 7 World Trade Center, 250 Greenwich St., FL 47, New York, NY 10007. (7) Includes 50,301 warrants to purchase common stock and 24,212,195 shares of common stock. The address of Deutsche Borse AG is Mergenthalerallee 61, 65760 Eschborn, Germany. Christoph Hansmeyer, a member of our Board, is Head of Strategy and Merger and Acquisitions at Deutsche Borse AG. (8) Includes 62,458 stock options exercisable within 60 days held by Mr. McLaughlin, 18,862 warrants to purchase common stock held by FTP Credit Holdings LLC and 5,779,044 shares of common stock held by FTP Equidate LLC. Mr. McLaughlin owns 99.25% of FTP Equidate LLC through the Steven J. McLaughlin Revocable Trust, of which he is the sole trustee. Mr. McLaughlin is the beneficial owner of FTP Credit Holdings LLC. (9) Includes 62,458 stock options exercisable within 60 days held by Mr. George. Also includes 2,957,103 shares of common stock held by Panorama Growth Partners II, LP and 1,434,124 shares of common stock held by Panorama Equidate Co-Investment, LLC. Panorama Point Partners GP II, LLC, an entity which is managed by Mr. George, is the general partner of Panorama Growth Partners II, LP. Panorama Point Partners, LLC, an entity which Mr. George is the controlling manager, is the manager of Panorama Equidate Co-Investment, LLC. Mr. George disclaims beneficial ownership of all securities held by Panorama Growth Partners II, LP and Panorama Equidate Co-Investment, LLC except to the extent of his pecuniary interest therein. (10) Includes 75,000 shares purchased in the PIPE Financing, 412,329 shares of common stock and 87,710 warrants to purchase common stock held by the James and Cecillia Herbert 1994 Revocable Trust. (11) Includes 1,000,000 shares of common stock issued in the PIPE Financing, (ii) 7,545,254 shares of common stock and (3) 62,458 shares of common stock underlying stock options held by Ossa Investments Pte. Ltd. ("Ossa"). Ossa is a wholly-owned subsidiary of Hotham Investments Pte. Ltd. ( Hotham ), which in turn is a wholly-owned subsidiary of Fullerton Management Pte Ltd. ( Fullerton ), which in turn is a wholly-owned subsidiary of Temasek Holdings (Private) Limited ( Temasek ). Temasek, Fullerton and Hotham, through the ownership described herein, may be deemed to beneficially own the shares of common stock directly beneficially owned by Ossa. The principal address of the foregoing entities is 60B Orchard Road, #06-18 Tower 2, The Atrium@Orchard, Singapore 238891. 117 Table of Contents SELLING SECURITYHOLDERS This prospectus relates to the offer and sale from time to time by the Selling Securityholders of up to 12,053,331 warrants and up to 115,289,295 shares of common stock, consisting of (i) up to 6,850,000 shares of common stock (the PIPE shares ) issued in a private placement pursuant to subscription agreements entered into on September 13, 2021 (the PIPE Financing ); (ii) up to 10,350,000 shares of common stock (the founder shares ) issued upon consummation of the Business Combination (defined below), in exchange for shares of our Class B ordinary shares originally issued in a private placement to Motive's initial shareholders; (iii) up to 14,000,000 shares of common stock (the FPA shares ) issued pursuant to the forward purchase agreement;(iv) up to 12,053,331 shares of common stock underlying the warrants and; (v) up to 72,035,964 shares of common stock issued or issuable to former equity holders of Forge pursuant to the Business Combination; The following table sets forth, as of the date of this prospectus, the names of the Selling Securityholders, the aggregate number of shares of common stock and warrants beneficially owned, the aggregate number of shares of common stock and warrants that the Selling Securityholders may offer pursuant to this prospectus and the number of shares of common stock beneficially owned by the Selling Securityholders after the sale of the securities offered hereby. The beneficial ownership of the Company s common stock is based on 169,223,826 shares of common stock issued and outstanding as of the date of this prospectus. We have determined beneficial ownership in accordance with the rules of the SEC and the information is not necessarily indicative of beneficial ownership for any other purpose. Unless otherwise indicated below, to our knowledge, the persons and entities named in the tables have sole voting and sole investment power with respect to all securities that they beneficially own, subject to community property laws where applicable. We cannot advise you as to whether the Selling Securityholders will in fact sell any or all of such common stock or warrants. In addition, the Selling Securityholders may sell, transfer or otherwise dispose of, at any time and from time to time, the common stock or warrants in transactions exempt from the registration requirements of the Securities Act after the date of this prospectus. For purposes of this table, we have assumed that the Selling Securityholders will have sold all of the securities covered by this prospectus upon the completion of the offering. Selling Securityholder information for each additional Selling Securityholder, if any, will be set forth by a prospectus supplement to the extent required prior to the time of any offer or sale of such Selling Securityholder s shares pursuant to this prospectus. Any prospectus supplement may add, update, substitute, or change the information contained in this prospectus, including the identity of 118 Table of Contents each Selling Securityholder and the number of shares registered on its behalf. A Selling Securityholder may sell or otherwise transfer all, some or none of such shares in this offering. See Plan of Distribution. Before the Offering After the Offering Name of Selling Securityholder(1) Number of Shares of Common Stock Number of Warrants Number of Shares of Common Stock Being Offered Number of Warrants Being Offered Number of Shares of Common Stock Percentage of Outstanding Shares of Common Stock Number of Warrants Percentage of Outstanding Warrants Paul Luc Robert Heyvaert and Entities Affiliated with Motive Partners(2) 24,230,000 12,053,331 36,283,331 12,053,331 Jill M. Considine(3) 30,000 30,000 Stephen C. Daffron(3) 30,000 30,000 Dina Dublon(3) 30,000 30,000 Paula Madoff.(3) 30,000 30,000 ION Trading Technologies S. .r.l.(4) 5,000,000 5,000,000 The 2012 Ritchotte Family Delaware Dynasty Trust(5) 25,000 25,000 Ossa Investments Pte. Ltd.(6) 8,545,254 8,607,712 Forge Holdings SPV, LP(7) 500,000 500,000 HF Fund LP(8) 250,000 250,000 James and Cecillia Herbert 1994 Revocable Trust(9) 487,329 575,039 Deutsche Borse AG(10) 24,212,195 24,262,496 Christoph Hansmeyer(11) 62,458 ` Kelly Rodriques(12) 5,714,267 8,842,192 Entities affiliated with Operative Capital(12) 2,274,467 2,281,696 Mark Lee(13) 1,205,146 1,212,453 Jose Cobos(14) 1,277,859 1,656,363 Norbert Ngethe(15) 94,687 477,756 Sohail Prasad(16) 5,300,000 5,301,750 Samvit Ramadurgam(17) 5,678,427 5,679,997 Gil Silberman(18) 1,184,776 1,184,776 Stephen George(19) 62,458 Entities affiliated with Panorama(19) 4,391,227 4,391,227 Steven McLaughlin(20) 62,458 Entities affiliated with FTP(20) 5,859,595 5,878,457 Asiff Hirji(21) 1,137,266 1,322,960 All Other Selling Securityholders(22) 1,248,716 * Less than one percent (1)Unless otherwise noted, the business address of each of those listed in the table above is 415 Mission St., Suite 5510, San Francisco, California 94105. (2)Consists of (i) 1,995,820 shares of common stock and warrants to purchase 665,273 shares of common stock held by Motive Capital Fund I-A, LP ( MC Fund I-A ), (ii) 2,526,551 shares of common stock and warrants to purchase 842,183 shares of common stock held by Motive Capital Fund I-B, LP ( MC Fund I-B ), (iii) 144,296 shares of common stock and warrants to purchase 48,098 common stock held by Motive Capital Fund I-MPF, LP ( MC Fund I-MPF ), (iv) 9,333,333 shares of common stock and warrants to purchase 3,111,110 shares of common stock held directly by MCF2 FG Aggregator, LLC ( MCF2 FG Aggregator ) and (vii) 10,230,000 shares of common stock and warrants to purchase 7,386,667 shares of common stock held by the Sponsor. The members of MCF2 FG Aggregator are Motive Capital Fund II-A, LP ( MC Fund II-A ), Motive Capital Fund II-B, LP ( MC Fund II-B ) and Motive Capital Fund II-MPF, LP ( MC Fund II-MPF ). The general partner of MC Fund I-A, MC Fund I-B and MC Fund I-MPF is Motive Capital Fund I GP, LP ( MC-I General Partner ). The manager of MCF2 FG 119 Table of Contents Aggregator is Motive Capital Fund II GP, LP ( MC-II General Partner ). The general partner of MC Fund II-A, MC Fund II-B and MC Fund II-MPF is MC-II General Partner. The general partner of MC-I General Partner and MC-II General Partner and the manager of Sponsor is Motive Partners GP, LLC ( Manager ). The sole member of the Manager is Rob Exploration, LLC ( Exploration ), of which Paul Luc Robert Heyvaert is the sole member. Each of MC Fund II-A, MC Fund II-B, MC Fund II-MPF, MC-I General Partner, MC-II General Partner, Manager, Exploration and Paul Luc Robert Heyvaert may be deemed to have beneficial ownership of the shares of common stock and warrants reported herein to the extent of their pecuniary interests therein. The address of the entities listed herein and Mr. Heyvaert is 7 World Trade Center, 250 Greenwich St., FL 47, New York, NY 10007. (3)Consists of 30,000 shares of common stock held by each former Motive independent director. The address of the former Motive independent directors is 7 World Trade Center, 250 Greenwich St., FL 47, New York, NY 10007. (4)Consists of 5,000,000 shares of common stock issued in the PIPE Financing. The address of ION Trading Technologies S. .r.l. is 63-65, rue de Merl L-2146 Luxembourg, Grand Duchy of Luxembourg. (5)Consists of 25,000 shares of common stock issued in the PIPE Financing. The address of The 2012 Ritchotte Family Delaware Dynasty Trust is 33 The Little Boltons, London, United Kingdom, SW10 9LL. (6)Consists of (i) 1,000,000 shares of common stock issued in the PIPE Financing, (ii) 7,545,254 shares of common stock and (3) 62,458 shares of common stock underlying stock options. Ossa is a wholly-owned subsidiary of Hotham Investments Pte. Ltd. ( Hotham ), which in turn is a wholly-owned subsidiary of Fullerton Management Pte Ltd. ( Fullerton ), which in turn is a wholly-owned subsidiary of Temasek Holdings (Private) Limited ( Temasek ). Temasek, Fullerton and Hotham, through the ownership described herein, may be deemed to beneficially own the shares of common stock directly beneficially owned by Ossa. The principal address of the foregoing entities is 60B Orchard Road, #06-18 Tower 2, The Atrium@Orchard, Singapore 238891. (7)Consists of 500,000 shares of common stock issued in the PIPE Financing. Eric Munson is the general partner of Forge Holdings SPV, LP. The address of Forge Holdings SPV, LP. is 1345 Avenue of the Americas, Fl 33, New York, NY 10105. (8)Consists of 250,000 shares of common stock issued in the PIPE Financing. The General Partner of HF Fund LP is WWJr. Enterprises Inc. WilliamWrigley, Jr. indirectly owns 100% of WWJr. Enterprises Inc. The address of the foregoing persons is HF Fund LP is 101 N. Clematis St., Ste 200, West Palm Beach, FL 33401. (9)Consists of (i) 75,000 shares of common stock issued in the PIPE Financing, (ii) 412,329 shares of common stock and (iii) 87,710 shares of common stock issuable pursuant to assumed warrants, all held by the James and Cecillia Herbert 1994 Revocable Trust. Mr. Herbert is a member of our Board. (10)Consists of 50,301 shares of common stock issuable pursuant to assumed warrants and 24,212,195 shares of common stock. The address of Deutsche Borse AG is Mergenthalerallee 61, 65760 Eschborn, Germany. Christoph Hansmeyer, a member of our Board, is Head of Strategy and Merger and Acquisitions at Deutsche Borse AG. (11)Consists of 62,458 shares of common stock underlying stock options held by Mr. Hansmeyer. Mr. Hansmeyer is a member of our Board. (12)Consists of (i) 5,647,322 shares of common stock held by Mr. Rodriques, (ii) 66,945 shares of common stock held indirectly through Pensco Trust Co. LLC Custodian FBO Kelly Rodriques Roth IRA (the IRA ), (iii) 677,733 shares of common stock held by Operative Capital LP ( Operative LP ) and (iv) 1,596,734 shares of Domestication Common Stock held by Operative Capital SPV I, LLC ( Operative SPV 1 ). Also consists of 3,122,931 shares of common stock underlying stock options held by Mr. Rodriques. Also consists of (i) up to 3,185 shares of common stock issuable pursuant to assumed warrants held by Mr. Rodriques, (ii) up to 1,809 shares of common stock issuable pursuant to assumed warrants held through the IRA and (iii) up to 7,229 shares of common stock issuable pursuant to assumed warrants held by Operative LP. Mr. Rodriques is a managing member of the ultimate general partner of each of Operative Capital LP and Operative Capital SPV I, LLC and thus may be deemed to be the beneficial owner of the shares held by such entities. Mr. Rodriques disclaims beneficial ownership of all securities held by Operative LP and Operative SPV 1 except to the extent of his pecuniary interest therein, if any. Mr. Rodriques is our Chief Executive Officer and a member of our Board. 120 Table of Contents (13)Consists of 1,205,146 shares of common stock and up to 7,307 shares of common stock issuable pursuant to assumed warrants. Mr. Lee is our Chief Financial Officer. (14)Consists of 1,090,485 shares of common stock and 378,504 shares of common stock underlying stock options held by Mr. Cobos. Also includes 93,687 shares of common stock held by the Elizabeth G. Cobos 2021 Annuity Trust and 93,687 shares of common stock held by the Jose Cobos 2021 Annuity Trust. Mr. Cobos is our Chief Operating Officer. (15)Consists of 94,687 shares of common stock and 383,069 shares of common stock underlying stock options held by Mr. Ngethe. Mr. Ngethe is our General Counsel and Secretary. (16)Consists of 5,678,427 shares of common stock and up to 1,570 shares of common stock issuable pursuant to assumed warrants. (17)Consists of 5,300,000 shares of common stock and up to 1,570 shares of common stock issuable pursuant to assumed warrants. (18)Consists of 1,184,776 shares of common stock. Mr. Silberman is the former Chief Legal Officer of Forge. (19)Consists of 62,458 shares of common stock underlying stock options held by Mr. George. Also includes 2,957,103 shares of common stock held by Panorama Growth Partners II, LP and 1,434,124 shares of common stock held by Panorama Equidate Co-Investment, LLC. Panorama Point Partners GP II, LLC, an entity which is managed by Mr. George, is the general partner of Panorama Growth Partners II, LP. Panorama Point Partners, LLC, an entity which Mr. George is the controlling manager, is the manager of Panorama Equidate Co-Investment, LLC. Mr. George disclaims beneficial ownership of all securities held by Panorama Growth Partners II, LP and Panorama Equidate Co-Investment, LLC except to the extent of his pecuniary interest therein. Mr. George is a member of our Board. (20)Consists of 62,458 shares of common stock underlying stock options held by Mr. McLaughlin, up to 18,862 shares of common stock issuable pursuant to assumed warrants held by FTP Credit Holdings LLC and 5,859,595 shares of common stock held by FTP Equidate LLC. Mr. McLaughlin owns 99.25% of FTP Equidate LLC through the Steven J. McLaughlin Revocable Trust, of which he is the sole trustee. Mr. McLaughlin is the beneficial owner of FTP Credit Holdings LLC. Mr. McLaughlin is a member of our Board. (21)Consists of (i) 682,359 shares of common stock held by Mr. Hirji, (ii) 254,518 shares of common stock held by the Hirjii-Wigglesworth 2021 Grantor Retained Annuity Trust and (iii) 200,389 shares of common stock held by Hirji-Wigglesworth Partners, LP ( HWP LP ). Also consists of (i) up to 123,236 shares of common stock issuable pursuant to assumed warrants held by HWP LP and (ii) 62,458 shares of common stock underlying stock options held by Mr. Hirji. Mr. Hirji was a member of the board of directors of Forge Global, Inc. prior to the Business Combination. (22)Consists of shares of common stock underlying assumed warrants held by Selling Securityholders not otherwise listed in this table. The disclosure with respect to the remaining Selling Securityholders is being made on an aggregate basis, as opposed to an individual basis, because the aggregate holdings are less than 1% of our outstanding common stock prior to the offering. 121 Table of Contents PLAN OF DISTRIBUTION We will not receive any proceeds from the sale of shares of common stock or warrants by the Selling Securityholders pursuant to this prospectus, except with respect to amounts received by us upon exercise of the warrants to the extent such warrants are exercised for cash. The Selling Securityholders will pay any underwriting discounts and commissions and expenses incurred by the Selling Securityholders incurred by the Selling Securityholders in disposing of the securities. We will bear all other costs, fees and expenses incurred in effecting the registration of the securities covered by this prospectus, including, without limitation, all registration and filing fees, NYSE listing fees and fees and expenses of our counsel and our independent registered public accountants. The securities beneficially owned by the Selling Securityholders covered by this prospectus may be offered and sold from time to time by the Selling Securityholders. The term Selling Securityholders includes donees, pledgees, transferees or other successors-in-interest selling securities received after the date of this prospectus from a Selling Securityholder as a gift, pledge, partnership distribution or other transfer. The Selling Securityholders will act independently of us in making decisions with respect to the timing, manner and size of each sale. Such sales may be made on one or more exchanges or in the over-the-counter market or otherwise, at prices and under terms then prevailing or at prices related to the then current market price or in negotiated transactions. Each Selling Securityholder reserves the right to accept and, together with its respective agents, to reject, any proposed purchase of securities to be made directly or through agents. The Selling Securityholders and any of their permitted transferees may sell their securities offered by this prospectus on any stock exchange, market or trading facility on which the securities are traded or in private transactions. If underwriters are used in the sale, such underwriters will acquire the shares for their own account. These sales may be at a fixed price or varying prices, which may be changed, or at market prices prevailing at the time of sale, at prices relating to prevailing market prices or at negotiated prices. The securities may be offered to the public through underwriting syndicates represented by managing underwriters or by underwriters without a syndicate. The obligations of the underwriters to purchase the securities will be subject to certain conditions. The underwriters will be obligated to purchase all the securities offered if any of the securities are purchased. Subject to the limitations set forth in any applicable registration rights agreement, the Selling Securityholders may use any one or more of the following methods when selling the securities offered by this prospectus: purchases by a broker-dealer as principal and resale by such broker-dealer for its own account pursuant to this prospectus; ordinary brokerage transactions and transactions in which the broker solicits purchasers; block trades in which the broker-dealer so engaged will attempt to sell the securities as agent but may position and resell a portion of the block as principal to facilitate the transaction; an over-the-counter distribution in accordance with the rules of the NYSE; through trading plans entered into by a Selling Securityholder pursuant to Rule 10b5-1 under the Exchange Act that are in place at the time of an offering pursuant to this prospectus and any applicable prospectus supplement hereto that provide for periodic sales of their securities on the basis of parameters described in such trading plans; through one or more underwritten offerings on a firm commitment or best efforts basis; settlement of short sales entered into after the date of this prospectus; agreements with broker-dealers to sell a specified number of the securities at a stipulated price per share or warrant; in at the market offerings, as defined in Rule 415 under the Securities Act, at negotiated prices, at prices prevailing at the time of sale or at prices related to such prevailing market prices, including sales made directly on a national securities exchange or sales made through a market maker other than on an exchange or other similar offerings through sales agents; directly to purchasers, including through a specific bidding, auction or other process or in privately negotiated transactions; through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise; through the distribution of securities by any Selling Securityholder to its partners, members or securityholders; 122 Table of Contents through a combination of any of the above methods of sale; or any other method permitted pursuant to applicable law. A Selling Securityholder that is an entity may elect to make an in-kind distribution of securities to its members, partners, stockholders or other equityholders pursuant to the registration statement of which this prospectus forms a part by delivering a prospectus. To the extent that such members, partners, stockholders or other equityholders are not affiliates of ours, such members, partners, stockholders or other equityholders would thereby receive freely tradable securities pursuant to a distribution pursuant to the registration statement of which this prospectus forms a part. To the extent that such members, partners, stockholders or other equityholders is an affiliate of ours (or to the extent otherwise required by law), we may file a prospectus supplement in order to permit such members, partners, stockholders or other equityholders to use the prospectus to resell the securities acquired in such distribution. There can be no assurance that the Selling Securityholders will sell all or any of the securities offered by this prospectus. In addition, the Selling Securityholders may also sell securities under Rule 144 under the Securities Act, if available, or in other transactions exempt from registration, rather than under this prospectus. The Selling Securityholders have the sole and absolute discretion not to accept any purchase offer or make any sale of securities if they deem the purchase price to be unsatisfactory at any particular time. The Selling Securityholders also may transfer the securities in other circumstances, in which case the transferees, pledgees or other successors-in-interest will be the selling beneficial owners for purposes of this prospectus. Upon being notified by a Selling Securityholder that a donee, pledgee, transferee, other successor-in-interest intends to sell our securities, we will, to the extent required, promptly file a supplement to this prospectus to name specifically such person as a selling securityholder. With respect to a particular offering of the securities held by the Selling Securityholders, to the extent required, an accompanying prospectus supplement or, if appropriate, a post-effective amendment to the registration statement of which this prospectus is part, will be prepared and will set forth the following information: the specific securities to be offered and sold; the names of the selling securityholders; the respective purchase prices and public offering prices, the proceeds to be received from the sale, if any, and other material terms of the offering; settlement of short sales entered into after the date of this prospectus; the names of any participating agents, broker-dealers or underwriters; and any applicable commissions, discounts, concessions and other items constituting compensation from the selling securityholders. In connection with distributions of the securities or otherwise, the Selling Securityholders may enter into hedging transactions with broker-dealers or other financial institutions. In connection with such transactions, broker-dealers or other financial institutions may engage in short sales of the securities in the course of hedging the positions they assume with Selling Securityholders. The Selling Securityholders may also sell the securities short and redeliver the securities to close out such short positions. The Selling Securityholders may also enter into option or other transactions with broker-dealers or other financial institutions which require the delivery to such broker-dealer or other financial institution of securities offered by this prospectus, which securities such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction). The Selling Securityholders may also pledge securities to a broker-dealer or other financial institution, and, upon a default, such broker-dealer or other financial institution, may effect sales of the pledged securities pursuant to this prospectus (as supplemented or amended to reflect such transaction). In order to facilitate the offering of the securities, any underwriters or agents, as the case may be, involved in the offering of such securities may engage in transactions that stabilize, maintain or otherwise affect the price of our securities. Specifically, the underwriters or agents, as the case may be, may over-allot in connection with the offering, creating a short position in our securities 123 Table of Contents for their own account. In addition, to cover overallotments or to stabilize the price of our securities, the underwriters or agents, as the case may be, may bid for, and purchase, such securities in the open market. Finally, in any offering of securities through a syndicate of underwriters, the underwriting syndicate may reclaim selling concessions allotted to an underwriter or a broker-dealer for distributing such securities in the offering if the syndicate repurchases previously distributed securities in transactions to cover syndicate short positions, in stabilization transactions or otherwise. Any of these activities may stabilize or maintain the market price of the securities above independent market levels. The underwriters or agents, as the case may be, are not required to engage in these activities, and may end any of these activities at any time. The Selling Securityholders may solicit offers to purchase the securities directly from, and it may sell such securities directly to, institutional investors or others. In this case, no underwriters or agents would be involved. The terms of any of those sales, including the terms of any bidding or auction process, if utilized, will be described in the applicable prospectus supplement. It is possible that one or more underwriters may make a market in our securities, but such underwriters will not be obligated to do so and may discontinue any market making at any time without notice. We cannot give any assurance as to the liquidity of the trading market for our securities. Our common stock and warrants are listed on the NYSE under the symbols FRGE and FRGE WS , respectively. The Selling Securityholders may authorize underwriters, broker-dealers or agents to solicit offers by certain purchasers to purchase the securities at the public offering price set forth in the prospectus supplement pursuant to delayed delivery contracts providing for payment and delivery on a specified date in the future. The contracts will be subject only to those conditions set forth in the prospectus supplement, and the prospectus supplement will set forth any commissions we or the Selling Securityholders pay for solicitation of these contracts. A Selling Securityholder may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. If the applicable prospectus supplement indicates, in connection with those derivatives, the third parties may sell securities covered by this prospectus and the applicable prospectus supplement, including in short sale transactions. If so, the third party may use securities pledged by any Selling Securityholder or borrowed from any Selling Securityholder or others to settle those sales or to close out any related open borrowings of stock, and may use securities received from any Selling Securityholder in settlement of those derivatives to close out any related open borrowings of stock. The third party in such sale transactions will be an underwriter and will be identified in the applicable prospectus supplement (or a post-effective amendment). In addition, any Selling Securityholder may otherwise loan or pledge securities to a financial institution or other third party that in turn may sell the securities short using this prospectus. Such financial institution or other third party may transfer its economic short position to investors in our securities or in connection with a concurrent offering of other securities. In effecting sales, broker-dealers or agents engaged by the Selling Securityholders may arrange for other broker-dealers to participate. Broker-dealers or agents may receive commissions, discounts or concessions from the Selling Securityholders in amounts to be negotiated immediately prior to the sale. In compliance with the guidelines of the Financial Industry Regulatory Authority ( FINRA ), the aggregate maximum discount, commission, fees or other items constituting underwriting compensation to be received by any FINRA member or independent broker-dealer will not exceed 8% of the gross proceeds of any offering pursuant to this prospectus and any applicable prospectus supplement. If at the time of any offering made under this prospectus a member of FINRA participating in the offering has a conflict of interest as defined in FINRA Rule 5121 ( Rule 5121 ), that offering will be conducted in accordance with the relevant provisions of Rule 5121. To our knowledge, there are currently no plans, arrangements or understandings between the Selling Securityholders and any broker-dealer or agent regarding the sale of the securities by the Selling Securityholders. Upon our notification by a Selling Securityholder that any material arrangement has been entered into with an underwriter or broker-dealer for the sale of securities through a block trade, special offering, exchange distribution, secondary distribution or a purchase by an underwriter or broker-dealer, we will file, if required by applicable law or regulation, a supplement to this prospectus pursuant to Rule 424(b) under the Securities Act disclosing certain material information relating to such underwriter or broker-dealer and such offering. 124 Table of Contents Underwriters, broker-dealers or agents may facilitate the marketing of an offering online directly or through one of their affiliates. In those cases, prospective investors may view offering terms and a prospectus online and, depending upon the particular underwriter, broker-dealer or agent, place orders online or through their financial advisors. In offering the securities covered by this prospectus, the Selling Securityholders and any underwriters, broker-dealers or agents who execute sales for the Selling Securityholders may be deemed to be underwriters within the meaning of the Securities Act in connection with such sales. Any discounts, commissions, concessions or profit they earn on any resale of those securities may be underwriting discounts and commissions under the Securities Act. The underwriters, broker-dealers and agents may engage in transactions with us or the Selling Securityholders, or perform services for us or the Selling Securityholders, in the ordinary course of business. In order to comply with the securities laws of certain states, if applicable, the securities must be sold in such jurisdictions only through registered or licensed brokers or dealers. In addition, in certain states the securities may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with. The Selling Securityholders and any other persons participating in the sale or distribution of the securities will be subject to applicable provisions of the Securities Act and the Exchange Act, and the rules and regulations thereunder, including, without limitation, Regulation M. These provisions may restrict certain activities of, and limit the timing of purchases and sales of any of the securities by, the Selling Securityholders or any other person, which limitations may affect the marketability of the shares of the securities. We will make copies of this prospectus available to the Selling Securityholders for the purpose of satisfying the prospectus delivery requirements of the Securities Act. The Selling Securityholders may indemnify any agent, broker-dealer or underwriter that participates in transactions involving the sale of the securities against certain liabilities, including liabilities arising under the Securities Act. We have agreed to indemnify the Selling Securityholders against certain liabilities, including certain liabilities under the Securities Act, the Exchange Act or other federal or state law. Agents, broker-dealers and underwriters may be entitled to indemnification by us and the Selling Securityholders against certain civil liabilities, including liabilities under the Securities Act, or to contribution with respect to payments which the agents, broker-dealers or underwriters may be required to make in respect thereof. A holder of warrants may exercise its warrants in accordance with the Warrant Agreement on or before the expiration date by surrendering, at the office of the warrant agent, Continental Stock Transfer & Trust Company, the certificate evidencing such warrant, an election to purchase, properly completed and duly executed, accompanied by full payment of the exercise price and any and all applicable taxes due in connection with the exercise of the warrant, subject to any applicable provisions relating to cashless exercises in accordance with the Warrant Agreement. 125 Table of Contents LEGAL MATTERS The validity of the shares of our securities offered by this prospectus will be passed upon by Goodwin Procter LLP, Redwood City, California. EXPERTS The consolidated financial statements of Motive Capital Corp as of December 31, 2021 and 2020 and for the year ended December 31, 2021, and the period from September 28, 2020 (inception) through December 31, 2020, appearing in this prospectus have been audited by WithumSmith+Brown, PC independent registered public accounting firm, as set forth in their report thereon appearing elsewhere herein and are included in reliance on such report given the authority of such firm as experts in accounting and auditing. The consolidated financial statements of Forge Global, Inc. at December 31, 2021 and 2020, and for each of the two years in the period ended December 31, 2021, appearing in this Prospectus and Registration Statement of Forge Global Holdings, Inc. have been audited by Ernst & Young LLP, independent registered public accounting firm, as set forth in their report thereon appearing elsewhere herein, and are included in reliance upon such report given on the authority of such firm as experts in accounting and auditing. 126 Table of Contents WHERE YOU CAN FIND MORE INFORMATION We file annual, quarterly and current reports, proxy statements and other information with the SEC. We have also filed a registration statement on Form S-1, including exhibits, under the Securities Act, with respect to common stock and warrants offered by this prospectus. This prospectus is part of the registration statement, but does not contain all of the information included in the registration statement or the exhibits. Our SEC filings are available to the public on the internet at a website maintained by the SEC located at http://www.sec.gov. We also maintain a website at http://www.forgeglobal.com. The information contained in or accessible from our website is not incorporated into this prospectus, and you should not consider it part of this prospectus. We have included our website address in this prospectus solely as an inactive textual reference. You may access, free of charge, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendment to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably practicable after such material is electronically filed with, or furnished to, the SEC. 127 Table of Contents INDEX TO FINANCIAL STATEMENTS FORGE GLOBAL, INC. Unaudited Condensed Consolidated Financial Statements Page Condensed Consolidated Balance Sheets as of March 31, 2022 and December 31, 2021 F-2 Condensed Consolidated Statements of Operations and Comprehensive Loss for the three months ended March 31, 2022 and 2021 F-3 Condensed Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders Deficit for the three months ended March 31, 2022 and 2021 F-4 Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2022 and 2021 F-5 Notes to Condensed Consolidated Financial Statements F-6 Consolidated Financial Statements for the Years Ended December 31, 2021 and December 31, 2020 Page Report of Independent Registered Public Accounting Firm F-28 Consolidated Balance Sheets F-29 Consolidated Statements of Operations and Comprehensive Loss F-30 Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders Deficit F-31 Consolidated Statements of Cash Flows F-32 Notes to Consolidated Financial Statements F-33 Schedule II F-65 MOTIVE CAPITAL CORP Page Report of Independent Registered Public Accounting Firm F-66 Financial Statements: Consolidated Balance Sheets as of December 31, 2021 and 2020 F-67 Consolidated Statements of Operations for the year ended December 31, 2021 and for the period from September 28, 2020 (inception) through December 31, 2020 F-68 Consolidated Statements of Changes in Shareholders Deficit for the year ended December 31, 2021 and for the period from September 28, 2020 (inception) through December 31, 2020 F-69 Consolidated Statements of Cash Flows for the year ended December 31, 2021 and for the period from September 28, 2020 (inception) through December 31, 2020 F-70 Notes to Consolidated Financial Statements F-71 F-1 Table of Contents FORGE GLOBAL HOLDINGS, INC. Unaudited Condensed Consolidated Balance Sheets (In thousands of U.S. dollars, except share and per share data) March 31, December 31, 2022 2021 Assets Current assets: Cash and cash equivalents $ 202,502 $ 74,781 Restricted cash 1,624 1,623 Accounts receivable, net 3,561 5,380 Payment-dependent notes receivable, current 243 1,153 Prepaid expenses and other current assets 6,170 5,148 Total current assets $ 214,100 $ 88,085 Property and equipment, net 535 497 Internal-use software, net 4,481 2,691 Goodwill and other intangible assets, net 136,843 137,774 Operating lease right-of-use assets 6,560 7,881 Payment-dependent notes receivable, noncurrent 14,975 13,453 Other assets, noncurrent 1,679 7,514 Total assets $ 379,173 $ 257,895 Liabilities, convertible preferred stock and stockholders equity (deficit) Current liabilities: Accounts payable $ 2,888 $ 1,920 Accrued compensation and benefits 9,706 21,240 Accrued expenses and other current liabilities 8,083 8,343 Operating lease liabilities, current 5,221 5,367 Payment-dependent notes payable, current 243 1,153 Total current liabilities $ 26,141 $ 38,023 Operating lease liabilities, noncurrent 4,102 5,159 Payment-dependent notes payable, noncurrent 14,975 13,453 Warrant liabilities 47,916 7,844 Total liabilities $ 93,134 $ 64,479 Commitments and contingencies (Note 8) Convertible preferred stock, net of issuance costs, $0.00001 par value; nil and 86,815,192 shares authorized as of March 31, 2022 and December 31, 2021, respectively; nil and 73,914,149 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively; aggregate liquidation preference of $0 and $271,845 as of March 31, 2022 and December 31, 2021, respectively 246,056 Stockholders equity (deficit): Common stock, $0.0001 par value; 169,223,826 and 63,301,388 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively 17 Additional paid-in capital 429,005 25,919 Accumulated deficit (142,983) (78,559) Total stockholders equity (deficit) $ 286,039 $ (52,640) Total liabilities, convertible preferred stock and stockholders equity (deficit) $ 379,173 $ 257,895 The accompanying notes are an integral part of these condensed consolidated financial statements. F-2 Table of Contents FORGE GLOBAL HOLDINGS, INC. Unaudited Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income (In thousands of U.S. dollars, except share and per share data) Three Months Ended March 31, 2022 2021 Revenues: Placement fees $ 14,585 $ 27,509 Custodial administration fees 5,437 4,546 Total revenues $ 20,022 $ 32,055 Transaction-based expenses: Transaction-based expenses (132) (976) Total revenues, less transaction-based expenses $ 19,890 $ 31,079 Operating expenses: Compensation and benefits $ 43,640 $ 20,496 Professional services 3,518 2,700 Acquisition-related transaction costs 3,706 Advertising and market development 1,504 987 Rent and occupancy 1,566 887 Technology and communications 2,023 1,434 General and administrative 1,602 953 Depreciation and amortization 1,082 1,396 Total operating expenses $ 58,641 $ 28,853 Operating (loss) income $ (38,751) $ 2,226 Interest expenses and other income (expenses): Interest income (expense), net 21 (554) Change in fair value of warrant liabilities (25,959) (908) Other income, net 388 166 Total interest expenses and other expenses $ (25,550) $ (1,296) (Loss) income before provision for income taxes (64,301) 930 Provision for (benefit from) income taxes 123 (8) Net (loss) income and comprehensive (loss) income $ (64,424) $ 938 Net (loss) income per share attributable to common stockholders: Basic $ (0.98) $ 0.00 Diluted $ (0.98) $ 0.00 Weighted-average shares used in computing net (loss) income per share attributable to common stockholders: Basic 66,007,461 61,598,361 Diluted 66,007,461 116,312,835 The accompanying notes are an integral part of these condensed consolidated financial statements. F-3 Table of Contents FORGE GLOBAL HOLDINGS, INC. Unaudited Condensed Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders Equity (Deficit) (In thousands of U.S. dollars, except share data) Additional Convertible Preferred Stock Common Stock Paid-In Accumulated Shares Amount Shares Amount Capital Deficit Total Balance as of December 31, 2021 23,668,198 $ 246,056 20,269,864 $ (*) $ 25,919 $ (78,559) $ (52,640) Retroactive application of recapitalization (Note 3) 50,245,951 43,031,139 5 (5) Unissued common stock (1) (210,302) Balance as of December 31, 2021 73,914,149 246,056 63,090,701 5 25,914 (78,559) (52,640) Pre-close exercise of vested options 190,505 (*) 102 102 Pre-close exercise of unvested options 4,472 (*) Pre-close issuance common stock for services 62,952 (*) 621 621 Conversion of preferred stock to common stock (73,914,149) (246,056) 73,914,149 7 246,049 246,056 Conversion of May 2020 and October 2020 preferred stock warrants of Legacy Forge to common stock warrants 2,949 2,949 Issuance of common stock upon settlement of promissory notes 2 4,205 4,207 Issuance of common stock upon Merger (net of redemptions), including PIPE and A&R FPA investors, net of transaction cost of $58,673 31,961,047 3 140,808 140,811 Vesting of early exercised stock options and restricted stock awards 409 409 Stock-based compensation expense 7,948 7,948 Net loss (64,424) (64,424) Balance as of March 31, 2022 $ 169,223,826 $ 17 $ 429,005 $ (142,983) $ 286,039 Balance as of December 31, 2020 15,717,345 $ 156,848 22,773,377 $ (*) $ 52,561 $ (60,060) $ (7,499) Retroactive application of recapitalization (Note 3) 33,366,839 $ 48,346,309 $ $ $ $ Balance as of December 31, 2020 49,084,184 $ 156,848 71,119,686 (*) $ 52,561 $ (60,060) $ (7,499) Issuance of Series B-1 convertible preferred stock at $3.9760 per share upon conversion of convertible notes and accrued interest 27,947 $ 111 $ $ $ $ Issuance of Class AA common stock upon exercise of vested stock options, including stock options exercised via promissory notes $ 473,658 (*) $ 168 $ $ 168 Issuance of Class AA common stock upon early exercise of unvested stock options $ 1,672,270 $ $ $ $ Vesting of early exercised stock options $ $ $ 11 $ $ 11 Share-based compensation expense $ $ $ 1,259 $ $ 1,259 Net loss $ $ $ $ 938 $ 938 Balance as of March 31, 2021 49,112,131 $ 156,959 73,265,614 $ (*) $ 53,999 $ (59,122) $ (5,123) (*) amount less than 1 (1)This amount represents shares that were not issued upon the closing of the Merger (see Note 3) as a result of a shareholder s demand for appraisal rights. If the appraisal rights demand is withdrawn or not perfected with the Delaware Court of Chancery, these shares will be issued to the shareholder. The accompanying notes are an integral part of these condensed consolidated financial statements. F-4 Table of Contents FORGE GLOBAL HOLDINGS, INC. Unaudited Condensed Consolidated Statements of Cash Flows (In thousands of U.S. dollars) Three Months Ended March 31, 2022 2021 Cash flows from operating activities: Net (loss) income $ (64,424) $ 938 Adjustments to reconcile net loss to net cash provided by operations: Share-based compensation 8,522 1,259 Depreciation and amortization 1,083 1,396 Transaction expenses related to the Merger 3,132 Amortization of right-of-use assets 1,056 651 Impairment of right-of-use assets 265 Bad debt allowance 302 100 Change in fair value of warrant liabilities 25,959 908 Settlement of related party promissory notes 5,517 Other 71 Changes in operating assets and liabilities: Accounts receivable 2,017 (331) Prepaid expenses and other assets (918) (537) Accounts payable 861 (926) Accrued expenses and other current liabilities (741) (3,572) Accrued compensation and benefits (11,606) (340) Operating lease liabilities (1,202) (860) Net cash used in operating activities $ (30,177) $ (1,243) Cash flows from investing activities: Purchases of property and equipment (11) Capitalized internal-use software development costs (1,681) (117) Net cash used in investing activities $ (1,692) $ (117) Cash flows from financing activities: Proceeds from the Merger 7,865 Proceeds from PIPE and A&R FPA investors 208,000 Payments for offering costs (56,379) Proceeds from exercise of options, including proceeds from repayment of promissory notes 105 432 Repayment of notes payable (2,863) Net cash provided by (used in) financing activities $ 159,591 $ (2,431) Net increase (decrease) in cash and cash equivalents 127,722 (3,791) Cash, cash equivalents and restricted cash, beginning of the period 76,404 42,179 Cash, cash equivalents and restricted cash, end of the period $ 204,126 $ 38,388 Supplemental disclosures of cash flow information: Cash paid for interest $ $ 642 Supplemental disclosure of non-cash investing and financing activities: Property and equipment purchases not yet paid $ 95 $ Deferred offering costs accrued and not yet paid $ 473 $ Capitalized internal-use software development costs accrued and not yet paid $ 360 $ 101 Reclassification of deferred offering costs to equity $ 5,923 $ Conversion of preferred stock $ 246,049 $ Conversion of May 2020 and October 2020 preferred stock warrants of Legacy Forge to common stock warrants $ 2,949 $ Non-cash assets acquired in the Merger $ 193 $ Warrants issued in connection with FPA $ 3,080 $ Assumption of merger warrants liability $ 13,983 $ Recapitalization of Legacy Forge common stock $ 5 $ Vesting of early exercised stock options and restricted stock awards $ 409 $ 11 Issuance of common stock upon settlement of related party promissory notes $ 4,207 $ Early excercise of common stock options upon settlement of related party promissory notes $ 1,310 $ The accompanying notes are an integral part of these condensed consolidated financial statements. F-5 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) 1. Organization and Description of Business Forge Global Holdings, Inc. (the Company , and f/k/a Motive Capital Corp) is a financial services platform headquartered in San Francisco, California. The Company has built a trusted marketplace to serve the unique needs of the private market by making purchases and sales of equity in private companies simple, transparent, and highly efficient to scale. The Company has strategically invested in technology to provide individual and institutional participants an efficient and liquid market, access to a large number of private company investment opportunities and the information and transparency they need to make well informed investment decisions. By digitizing a historically analog, complex and opaque process, the Company s platform delivers opportunities to trade in private company stocks. Today, the Company is a leading provider of mission-critical infrastructure technology and services for the private market. On March 21, 2022 (the Closing Date ), the Company consummated the Business Combination (as defined below) pursuant to the terms of the Agreement and Plan of Merger dated September 13, 2021 (the Merger Agreement ), by and among Motive Capital Corp, a blank check company incorporated as a Cayman Islands exempted company in 2020 ( MOTV ), FGI Merger Sub Inc., a Delaware corporation and wholly owned subsidiary of MOTV ( Merger Sub ), and Forge Global, Inc., a Delaware corporation ( Legacy Forge ). Pursuant to the Merger Agreement, on the Closing Date, immediately prior to the consummation of the Business Combination, MOTV changed its jurisdiction of incorporation from the Cayman Islands to the State of Delaware and changed its corporate name to Forge Global Holdings, Inc. (the Domestication ). On the Closing Date, Merger Sub merged with and into Legacy Forge (the Merger ), with Legacy Forge surviving the Merger as a direct, wholly-owned subsidiary of the Company (together with the Merger, the Domestication, and the other transactions contemplated by the Merger Agreement, the Business Combination ). The Merger was accounted for as a reverse recapitalization with Legacy Forge being the accounting acquirer and MOTV as the acquired company for accounting purposes. Accordingly, all historical financial information presented in the unaudited condensed consolidated financial statements represents the accounts of Legacy Forge and its wholly owned subsidiaries as if Legacy Forge is the predecessor to the Company. The shares and net loss per common share prior to the Merger have been retroactively restated as shares reflecting the exchange ratio (the Exchange Ratio ) as established by the Merger Agreement (each outstanding share of Legacy Forge Class A common stock was exchanged for approximately 3.122931 shares of the Company s common stock, including all shares of Legacy Forge preferred stock, which were converted to shares of Legacy Forge s Class A common stock immediately prior to the Merger). Prior to the Business Combination, MOTV s units, public shares, and Public Warrants were listed on the New York Stock Exchange under the symbols MOTV-UN , MOTV , and MOTV-WT , respectively. On the Closing Date, the Company s common stock and Public Warrants began trading on The New York Stock Exchange ( NYSE ), under the symbols FRGE and FRGE WS , respectively. See Note 3, Recapitalization for additional details. 2. Summary of Significant Accounting Policies Basis of Presentation and Consolidation The accompanying unaudited condensed consolidated financial statements include the accounts of the Company, and its subsidiaries and have been prepared in accordance with generally accepted accounting principles in the United States of America ( GAAP ) and in accordance with the rules and regulations of the Securities and Exchange Commission ( SEC ). All intercompany balances and transactions have been eliminated in consolidation. In the normal course of business, the Company has transactions with various investment entities as discussed in Note 9, Off Balance Sheet Items. In certain instances, the Company provides investment advisory services to pooled investment vehicles (each, a Fund ). The Company does not have discretion to make any investment, except for the specific investment for which a Fund was formed. The Company performs an assessment to determine (a) whether the Company s investments or other interests will absorb portions of a variable interest entity s expected losses or receive portions of the entity s expected residual returns and (b) whether the Company s involvement, through holding interests directly or indirectly in the entity would give it a controlling financial interest. The Company consolidates entities in which it, directly or indirectly, is determined to have a controlling financial interest. Consolidation conclusions are reviewed quarterly to identify whether any reconsideration events have occurred. There have been no changes to the F-6 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) Company s significant accounting policies described in the audited consolidated financial statements for the year ended December 31, 2021, that have had a material impact on these condensed consolidated financial statements and related notes. Unaudited Interim Condensed Consolidated Financial Information The accompanying interim condensed consolidated financial statements as of March 31, 2022 and for the three months ended March 31, 2022 and 2021 and accompanying notes, are unaudited. These unaudited interim condensed consolidated financial statements (the condensed consolidated financial statements ) have been prepared in accordance with GAAP applicable to interim financial statements. These financial statements are presented in accordance with the rules and regulations of the SEC and do not include all disclosures normally required in annual consolidated financial statements prepared in accordance with GAAP. As such, the information included herein should be read in conjunction with the consolidated financial statements and accompanying notes as of and for the year ended December 31, 2021 (the audited consolidated financial statements ) that was included in the Company s Form 8-K filed on March 25, 2022, which provides a more complete discussion of the Company s accounting policies and certain other information. In management s opinion, the unaudited interim condensed consolidated financial statements have been prepared on the same basis as the annual financial statements, which include only normal recurring adjustments, necessary for a fair statement of the Company s financial position as of March 31, 2022 and its condensed consolidated results of operations and cash flows for the three months ended March 31, 2022 and 2021. The results of operations for the three months ended March 31, 2022 are not necessarily indicative of the results expected for the year ending December 31, 2022 or any other future interim or annual periods. As a result of the Merger, prior period share and per share amounts presented in the accompanying condensed consolidated financial statements and these related notes have been retroactively converted. Segment Information The Company operates as a single operating segment and reportable segment. The Company s chief operating decision maker is its Chief Executive Officer, who reviews financial information presented on a consolidated basis for purposes of making operating decisions, assessing financial performance, allocating resources and evaluating the Company s financial performance. The Company operates primarily in the United States, and, accordingly, the geographic distribution of revenue and assets is not significant. For the three months ended March 31, 2022, revenue outside of the United States, based on customer billing address, was $2,931, and was not material for the three months ended March 31, 2021. As of March 31, 2022 and December 31, 2021, long-lived assets located outside of the United States were not material. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Such management estimates include, but are not limited to collectability of accounts receivable, the fair value of financial assets and liabilities, the fair value of assets acquired and liabilities assumed in business combinations, the fair value of consideration paid for business combinations, the useful lives of acquired intangible assets and property and equipment, the impairment of long-lived assets and goodwill, the fair value of warrants, equity awards and share-based compensation expenses, including the determination of the fair value of the Company s common stock prior to the Merger, and the valuation of deferred tax assets and uncertain tax positions. These estimates are inherently subjective in nature and, therefore, actual results may differ from the Company s estimates and assumptions. The Company bases its estimates on historical experience and also on assumptions that it believes are reasonable. Further, the Company applies judgment in determining whether, directly or indirectly, it has a controlling financial interest in the Funds, in order to conclude whether any of the Funds must be consolidated. Starting in 2020, the global COVID-19 pandemic created disruption in global supply chains, increased rates of unemployment and adversely impacted many industries. In 2022, the COVID-19 pandemic continues to persist. We continue to closely monitor developments; however, we cannot predict the future impact of COVID-19 on our operational and financial performance, or the specific ways the pandemic may uniquely impact our customers, employees, and business partners, all of which continue to involve F-7 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) significant uncertainties that depend on future developments, which include, among others, the severity and duration of the pandemic and its impact on the overall economy and other industry sectors; vaccination rates; the longer-term efficacy of vaccinations; and the potential emergence of new, more transmissible or severe variants. The Company believes the estimates and assumptions underlying the condensed consolidated financial statements are reasonable and supportable based on the information available as of March 31, 2022. These estimates may change as new events occur and additional information is obtained, and related financial impacts will be recognized in the Company s consolidated financial statements as soon as those events become known. Fair Value Measurements Fair value is defined as the exchange price that would be received from the sale of an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. When developing fair value measurements, the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs. A financial instrument s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurements. Three levels of inputs may be used to measure fair value: Level 1 Quoted prices in active markets for identical assets or liabilities. Level 2 Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Accounts Receivable, Net Accounts receivable consist of amounts billed and currently due from customers, which are subject to collection risk. The allowance for doubtful accounts is based on the Company s assessment of the collectability of accounts. The Company regularly reviews the adequacy of the allowance for doubtful accounts based on a combination of factors, including an assessment of the customer s aging balance, the financial condition of the customer, and the amount of any receivables in dispute. Accounts receivable deemed uncollectible are charged against the allowance for doubtful accounts when identified. The total allowance for doubtful accounts netted against account receivables in the condensed consolidated balance sheets was $1,819 and $1,517 as of March 31, 2022 and December 31, 2021, respectively. Concentration of Credit Risks Financial instruments that potentially subject the Company to concentrations of credit risk primarily comprise of cash and cash equivalents and restricted cash, payment-dependent notes receivables, and accounts receivable. Cash and cash equivalents and restricted cash may, at times, exceed amounts insured by the Federal Deposit Insurance Corporation and the Securities Investor Protection Corporation, respectively. The Company s exposure to credit risk in the event of default by financial institutions is limited to the amounts recorded on the condensed consolidated balance sheets. The Company performs periodic evaluations of the relative credit standing of these financial institutions to limit the amount of credit exposure. The Company has not experienced any losses on its deposits of cash and cash equivalents to date. The Company s exposure to credit risk associated with its contracts with holders of private company equity ( sellers ) and investors ( buyers ) related to the transfer of private securities is measured on an individual counterparty basis. Concentrations of credit risk can be affected by changes in political, industry, or economic factors. To reduce the potential for risk concentration, the Company s exposure is monitored in light of changing counterparty and market conditions. As of March 31, 2022 and December 31, 2021, the Company did not have any material concentrations of credit risk outside the ordinary course of business. F-8 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) As of March 31, 2022 and December 31, 2021, no customers accounted for more than 10% of the Company s accounts receivable. No customer accounted for more than 10% of total revenue, less transaction-based expenses for the three months ended March 31, 2022 and 2021, respectively. Revenue Recognition The Company recognizes revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The Company generates revenue from fees charged for the trading of private placements on its marketplace platform, and fees for account and asset management provided to customers. The Company disaggregates revenue by service type, as management believes that this level of disaggregation best depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are impacted by economic factors. Revenue from Contracts with Customers The Company enters into contracts with customers that can include various services, which are capable of being distinct and accounted for as separate performance obligations. When applicable, an allocation of the transaction fees to the performance obligations or to the distinct goods or services that form part of a single performance obligation will depend on the individual facts and circumstances of the contract. All of the Company s revenues are from contracts with customers. The Company is the principal in its contracts, with the exception of sub-account fees, in which the Company acts as an agent and records revenue from fees earned related to cash balances in customers custodial accounts. Each of our significant performance obligations and our application of ASC 606 to our revenue arrangements are discussed in further detail below: Placement Fees The Company maintains a trading platform which generates revenues by collecting transaction fees from institutions, individual investors and private equity holders. Placement fees are charged by the Company for meeting the point-in-time performance obligation of executing a private placement on its platform. Placement fee rates are individually negotiated for each transaction and vary depending on the specific facts and circumstance of each agreement. These fees are event-driven and invoiced upon the closing of the transaction outlined in each agreement. These fees may be expressed as a dollar amount per share, a flat dollar amount, or a percentage of the gross transaction proceeds. The Company earns agency placement fees in non-underwritten transactions, such as private placements of equity securities. The Company enters into arrangements with individual accredited customers or pooled investment vehicles to execute private placements in the secondary market. The Company will receive placement fees on these transactions and believes that its trade execution performance obligation is completed upon the placement and consummation of a transaction and, as such, revenue is earned on the transaction date with no further obligation to the customer at that time. The Company acts as a principal and recognizes the placement fee revenue earned for the execution of a trade on a gross basis. Custodial Administration Fees The Company generates revenues primarily by performing custodial account administration and maintenance services for its customers. Specifically, the Company charges administration fees for its services in maintaining custodial accounts, including asset-based fees, which are determined by the number and types of assets in these accounts. Additionally, the Company earns fees for opening and terminating accounts, and facilitating transactions, which are assessed at the point of transaction. Account and asset fees are assessed on the first day of the calendar quarter. Cash administration fees are based on cash balances within the custodial accounts and are assessed on the last day of the month. Revenues from custodial administration fees are recognized either over time as underlying performance obligations are met and day-to-day maintenance activities are performed for custodial accounts, or at a point in time upon completion of transactions requested by custodial account holders. Contract Balances Contract assets represent amounts for which we have recognized revenue for contracts that have not yet been invoiced to our customers. The Company does not have any contract assets as of March 31, 2022 and December 31, 2021. Contract liabilities consist of deferred revenue, which relates to amounts invoiced in advance of performance under a revenue contract. The total contract F-9 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) liabilities of $230 and $357 as of March 31, 2022 and December 31, 2021, respectively, related to advance billings for placement fees and custodial administration fees, recorded in accrued expenses and other current liabilities on the condensed consolidated balance sheets. Practical Expedients In certain arrangements, the Company receives payment from a customer either before or after the performance obligation has been satisfied; however, the contracts do not contain a significant financing component. The Company has applied the practical expedient in ASC 606 and excludes information about a) remaining performance obligations that have an original expected duration of one year or less and b) transaction price allocated to remaining performance obligations if the variable consideration is allocated entirely to a wholly unsatisfied performance obligation. The Company has also applied the practical expedient in accordance with ASC 340-40, Other Assets and Deferred Costs to expense costs as incurred for costs to obtain a contract with a customer when the amortization period would have been one year or less. Transaction-Based Expenses Transaction-based expenses represent the fees incurred to support placement and custodial activities. These include expenses for fund insurance, fund management and fund settlement expenses that relates to services provided to the Funds, and external broker fees and transfer fees related to placement and custodial services provided to other brokerage and custodial customers to facilitate transactions. Warrant Liabilities The Public Warrants, Private Placement Warrants and the warrants issued in connection with the Merger (see Note 3 and 10) are recognized as derivative liabilities in accordance with ASC 815. Accordingly, the Company recognizes the warrant instruments as liabilities at fair value and adjusts the carrying value of the instruments to fair value at each reporting period until they are exercised. The Company will continue to adjust the warrant liability for changes in the fair value until the earlier of a) the exercise or expiration of the warrants or b) the redemption of the warrants, at which time the warrants will be reclassified to additional paid-in-capital. Recent Accounting Pronouncements As an emerging growth company, the Jumpstart Our Business Startups Act ( JOBS Act ) allows the Company to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. The Company has elected to use this extended transition period under the JOBS Act. The adoption dates discussed below reflect this election and no new accounting pronouncements were adopted during the period. Recently Issued Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, with subsequent amendments, Financial Instruments Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ( ASU 2016-13 ). ASU 2016-13 requires immediate recognition of management s estimates of current expected credit losses. ASU 2016-13 is effective for annual reporting periods beginning after December 15, 2022, and interim periods within that fiscal year, with early adoption permitted. The Company is currently evaluating the impact of adoption on the consolidated financial statements. 3. Recapitalization As discussed in Note 1, Organization and Description of Business , on the Closing Date, Legacy Forge completed the acquisition of MOTV and acquired 100% of MOTV s shares and Legacy Forge received gross proceeds of $215,613, which includes $7,865 in proceeds from MOTV s trust and bank accounts, net of redemptions, $68,500 in proceeds from the PIPE Investment (as defined below), of which $500 is recorded in accounts receivable in the condensed consolidated balance sheet as of March 31, 2022, F-10 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) and $140,000 in proceeds from the A&R FPA (as defined below). As of March 31, 2022, the Company recorded $61,806 of transaction costs, which consisted of legal, accounting, and other professional services directly related to the Merger, of which $58,673 was related to common stock issued during the Merger and was recorded as a reduction to additional paid-in capital. The remaining $3,132 was related to issuance of Public and Private Placement Warrants, including warrants issued to A&R FPA investors, and was expensed immediately upon consummation of the Merger as acquisition-related transaction cost in the condensed consolidated statements of operations and comprehensive (loss) income. The cash outflows related to these costs were presented as financing activities in the Company s condensed consolidated statements of cash flows. These deferred offering costs are offset against proceeds upon accounting for the consummation of the Merger. In addition, upon closing of the Merger, certain executives received a one-time transaction bonus for an aggregate amount of $17,735, of which $12,218 was to be paid to the executives in cash, and the remaining amount $5,517 was offset against outstanding promissory notes that were due from these executives as of the Closing Date (see Note 10). The transaction bonus is included in compensation and benefits in the condensed consolidated statement of operations and comprehensive (loss) income for the three months ended March 31, 2022. On the Closing Date, each holder of MOTV Class A ordinary stock received one share of the Company s common stock, par value $0.0001, for each MOTV Class A ordinary share held prior to the Merger, and each holder of MOTV Class B ordinary stock received one share of the Company s common stock, par value $0.0001, for each MOTV Class B ordinary share held prior to the Merger. See Note 10, Capitalization and Note 11, Warrants , for additional details of the Company s stockholders equity prior to and subsequent to the Merger. All equity awards of Legacy Forge were assumed by the Company and converted into comparable equity awards that are settled or exercisable for shares of the Company s common stock. As a result, each outstanding stock option of Legacy Forge was converted into an option to purchase shares of the Company s common stock based on the Exchange Ratio and each outstanding warrant of Legacy Forge was converted into a warrant to purchase shares of the Company s common stock based on the Exchange Ratio. The Merger was accounted for as a reverse recapitalization with Legacy Forge as the accounting acquirer and MOTV as the acquired company for accounting purposes. Legacy Forge was determined to be the accounting acquirer since Legacy Forge s former management makes up the majority of the Company s management team, Legacy Forge s former management nominated or represents a majority of the Company s board of directors, and Legacy Forge represents the majority of the continuing operations of the Company. Accordingly, all historical financial information presented in these unaudited condensed consolidated financial statements represents the accounts of Legacy Forge and its wholly owned subsidiary. Net assets were stated at historical cost consistent with the treatment of the transaction as a reverse recapitalization of Legacy Forge. Each public and private warrant of MOTV that was unexercised at the time of the Merger was assumed by the Company and represents the right to purchase one share of the Company s common stock upon exercise of such warrant. PIPE Investment On March 21, 2022, concurrently with the execution of the Merger Agreement, MOTV entered into subscription agreements with certain investors, to which such investors collectively subscribed for an aggregate of 6,850,000 shares of the Company s common stock at $10.00 per share for aggregate gross proceeds of $68,500 (the PIPE Investment ). The PIPE Investment was consummated concurrently with the closing of the Merger. Amended and Restated Forward Purchase Agreement On March 21, 2022, concurrently with the execution of the Merger Agreement, certain MOTV fund vehicles managed by an affiliate of MOTV purchased 14,000,000 units at $10.00 per unit, for an aggregate purchase price of $140,000 in a private placement that closed substantially concurrently with the closing of the Business Combination under the Amended and Restated Forward Purchase Agreement (the A&R FPA ). Each unit consists of one share of the Company s common stock and one-third of one public warrant. The A&R FPA was consummated concurrently with the closing of the Merger. F-11 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) 4. Fair Value Measurements Financial instruments consist of cash equivalents, restricted cash, accounts receivable, accounts payable, accrued liabilities, payment-dependent notes receivable, payment-dependent notes payable, and warrant liabilities. Cash equivalents, payment-dependent notes receivable, payment-dependent notes payable, and warrant liabilities are stated at fair value on a recurring basis. Restricted cash, accounts receivable, accounts payable, and accrued liabilities are stated at their carrying value, which approximates fair value due to the short time to the expected receipt or payment date. The Company did not have short-term investments as of March 31, 2022 and December 31, 2021. The following tables present the fair value hierarchy for assets and liabilities measured at fair value on a recurring basis: As of March 31, 2022 Level 1 Level 2 Level 3 Total Cash and cash equivalents: Money market funds $ 159,316 $ $ $ 159,316 Payment-dependent notes receivable, current 243 243 Payment-dependent notes receivable, noncurrent 14,975 14,975 Total financial assets $ 159,559 $ $ 14,975 $ 174,534 Payment-dependent notes payable, current 243 243 Payment-dependent notes payable, noncurrent 14,975 14,975 Warrant liabilities 5,000 5,000 Public Warrants 30,654 30,654 Private Placement Warrants 12,262 12,262 Total financial liabilities $ 30,897 $ 12,262 $ 19,975 $ 63,134 As of December 31, 2021 Level 1 Level 2 Level 3 Total Cash and cash equivalents: Money market funds $ 24,240 $ $ $ 24,240 Payment-dependent notes receivable, current 1,153 1,153 Payment-dependent notes receivable, noncurrent 13,453 13,453 Total financial assets $ 25,393 $ $ 13,453 $ 38,846 Payment-dependent notes payable, current $ 1,153 $ $ $ 1,153 Payment-dependent notes payable, noncurrent 13,453 13,453 Warrant liabilities 7,844 7,844 Total financial liabilities $ 1,153 $ $ 21,297 $ 22,450 The Company classifies money market funds and certain payment-dependent notes receivable and payment-dependent notes payable within Level 1 of the fair value hierarchy because the Company values these investments using quoted market prices. The Company classifies the Private Placement Warrants within Level 2, because they were valued using quoted prices of an identical instrument. The Company classifies certain payment-dependent notes receivable and payment-dependent notes payable within Level 3 of the fair value hierarchy if the underlying securities are equity of private companies whose regular financial and nonfinancial information is generally not available other than when it is publicly disclosed, or significant unobservable inputs are used to estimate fair value. F-12 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) The following tables summarize the quantitative inputs and assumptions used for the Company s payment-dependent notes receivable and payment-dependent notes payable classified as Level 3 of the fair value hierarchy: As of March 31, 2022 Significant Valuation Unobservable Level 3 Measurements Fair Value Technique(s) Input(s) Range Financial assets Payment-dependent notes receivable $ 14,975 Transaction prices N/A(1) N/A Financial liabilities Payment-dependent notes payable $ 14,975 Transaction prices N/A(1) N/A As of December 31, 2021 Significant Valuation Unobservable Level 3 Measurements Fair Value Technique(s) Input(s) Range Financial assets Payment-dependent notes receivable $ 13,453 Transaction prices N/A(1) N/A Financial liabilities Payment-dependent notes payable $ 13,453 Transaction prices N/A(1) N/A (1)The Company considers completed transactions made through the Company s platform for the relevant private securities as relevant data inputs. The Company uses a hybrid method that incorporates the Black-Scholes option-pricing model and an adjusted backsolve model to estimate the fair value of the warrant liabilities, other than Public and Private Placement Warrants. This approach is a scenario-based analysis that considers many assumptions, including the likelihood of potential liquidity events, the nature and timing of such potential events, actions taken with regard to the warrants at expiration, as well as discounts for lack of marketability of the underlying securities and warrants. Subsequent to the Merger, the Series B-1 preferred stock warrants and Junior preferred stock warrants were converted to common stock warrants. As a result, the Series B-1 preferred stock warrants were remeasured at fair value prior to the conversion resulting in a change in fair value of $106 recognized as a component of change in fair value of warrant liabilities within the condensed consolidated statements of operations and comprehensive (loss) income, and then settled in additional paid-in capital as a result of the conversion to equity-classified common stock warrants. The Junior Preferred Warrants (as defined below, see Note 11) were remeasured at fair value prior to the conversion, which did not result in a change in fair value for the three months ended March 31, 2022. These warrants will remain liability-classified, as the Company has an obligation to issue a variable number of shares of common stock for a fixed monetary amount of $5,000. The Company estimated the fair value of the warrants liability, other than Public and Private Placement Warrants, as of March 31, 2022 and December 31, 2021, respectively, using the following key assumptions: As of March 31, December 31, 2022 2021 Fair value of underlying securities $ 33.9 $ 30.8 Discounts for lack of marketability 0.0 % 0.0 % Expected term (years) 3.6 3.4 8.8 Expected volatility 44.3 % 40.4% 44.3 % Risk-free interest rate 2.4 % 1.0% 1.5 % Expected dividend yield 0.0 % 0.0 % Fair value per warrant 23.2 $ 5.0 - $22.0 The Company performed calculation of the fair value of Junior Preferred Warrants as of March 31, 2022 based on the assumptions noted above, however the total warrant liability associated with the Junior Preferred Warrants has not changed, as the F-13 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) Company s obligation to issue a variable number of shares of common stock is limited to a maximum fixed fair value amount of $5,000. The Public Warrants were valued as of March 31, 2022 using the listed trading price of $1.66 per public warrant. The Company transfers financial instruments out of Level 3 on the date when underlying input parameters are readily observable from existing market quotes. Transfers from Level 3 to Level 1 generally relate to a company going public and listing on a national securities exchange. During the three months ended March 31, 2022 there were no transfers of securities into or out of Level 3. During the three months ended March 31, 2021, there were transfers of securities segregated for customers from Level 3 to Level 1, as one private company was acquired by a public company and became publicly-traded under the acquirer, and the Company was able to obtain independent market-quoted prices for the acquirer company. The following tables provide reconciliation for all financial assets measured at fair value using significant unobservable inputs (Level 3) for three months ended March 31, 2022 and 2021: Balance as of December 31, 2020 $ 51,859 Acquisition of short-term investments 362 Change in fair value of short-term investments (23) Short-term investments transferred out of Level 3 to Level 1 (339) Change in fair value of payment-dependent notes receivable 21,309 Settlement of payment-dependent notes receivable (261) Balance as of March 31, 2021 $ 72,907 Balance as of December 31, 2021 $ 13,453 Change in fair value of payment-dependent notes receivable 1,522 Balance as of March 31, 2022 $ 14,975 The following tables provide reconciliation for payment-dependent notes payable measured at fair value using significant unobservable inputs (Level 3) for three months ended March 31, 2022 and 2021: Balance as of December 31, 2020 $ 51,859 Change in fair value of payment-dependent notes payable 21,309 Settlement of payment-dependent notes payable (261) Balance as of March 31, 2021 $ 72,907 Balance as of December 31, 2021 $ 13,453 Change in fair value of payment-dependent notes payable 1,522 Balance as of March 31, 2022 $ 14,975 The following tables provide reconciliation for warrant liabilities measured at fair value using significant unobservable inputs (Level 3) for three months ended March 31, 2022 and 2021: Balance as of December 31, 2020 $ 1,780 Change in fair value of warrant liabilities 908 Balance as of March 31, 2021 $ 2,688 Balance as of December 31, 2021 $ 7,844 Change in fair value of warrant liabilities 106 Settlement of the warrant liability via conversion to equity-classified common stock warrants (2,950) Balance as of March 31, 2022 $ 5,000 F-14 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) 5. Condensed Consolidated Balance Sheet Components Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following: March 31, December 31, 2022 2021 Prepaid expenses $ 3,702 $ 3,162 Other current assets 2,468 1,986 Prepaid expenses and other current assets $ 6,170 $ 5,148 Property and Equipment, Net Property and equipment, net consisted of the following: March 31, December 31, 2022 2021 Computer equipment $ 335 $ 336 Furniture and fixtures 632 621 Leasehold improvements 415 320 Total property and equipment $ 1,382 $ 1,277 Less: accumulated depreciation (847) (780) Property and equipment, net $ 535 $ 497 For the three months ended March 31, 2022 and 2021, the Company recorded depreciation expense related to property and equipment amounting to $68 and $128, respectively. Internal-Use Software, Net Capitalized internal-use software consists of the following: March 31, December 31, 2022 2021 Capitalized internal-use software $ 4,734 $ 2,860 Less: Accumulated amortization (253) (169) Total capitalized internal-use software $ 4,481 $ 2,691 For the three months ended March 31, 2022 and 2021, the Company recorded amortization expense on capitalized internal-use software placed in service amounting to $84 and $20, respectively. F-15 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following: March 31, December 31, 2022 2021 Accrued professional services $ 1,527 $ 1,798 Accrued payments related to acquisitions and financing 337 1,134 Accrued taxes and deferred tax liabilities 1,304 1,421 Common stock unvested liability 1,690 786 Other current liabilities 3,225 3,204 Total $ 8,083 $ 8,343 6. Goodwill and Intangible Assets, Net During the year ended December 31, 2021, the Company purchased a domain name for $2,202. The purchase of the domain name created an intangible asset with an indefinite life that is not being amortized for book purposes. There were no changes in the recorded balance of goodwill during the three months ended March 31, 2022. In-process research and development assets were acquired in business combinations, and launched in September 2021. The Company started to amortize the assets in September 2021 using the straight-line method over the estimated useful lives determined as 5 years. The components of intangible assets and accumulated amortization are as follows: As of March 31, 2022 Weight Average Remaining Amortization Gross Carrying Accumulated Net Carrying Period Amount Amortization Amount Finite-lived intangible assets: Developed technology 2.7 years $ 13,200 $ (5,946) $ 7,254 Customer relationships 6.8 years 7,410 (1,931) 5,479 Trade name 0.0 years 320 (320) Launched IPR&D assets 4.5 years 960 960 Total finite-lived intangible assets $ 21,890 $ (8,197) $ 13,693 Indefinite-lived intangible assets: Trade name website domain (forge.com) Indefinite 2,202 2,202 Total indefinite-lived intangible assets 2,202 2,202 Total intangible assets $ 24,092 $ (8,197) $ 15,895 F-16 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) As of December 31, 2021 Weight Average Remaining Amortization Gross Carrying Accumulated Net Carrying Period Amount Amortization Amount Finite-lived intangible assets: Developed technology 3.0 years $ 13,200 $ (5,250) $ 7,950 Customer relationships 7.0 years 7,410 (1,696) 5,714 Trade name 0.0 years 320 (320) Launched IPR&D assets 5.0 years 960 960 Total finite-lived intangible assets $ 21,890 $ (7,266) $ 14,624 Indefinite-lived intangible assets: Trade name website domain (forge.com) Indefinite 2,202 2,202 Total indefinite-lived intangible assets 2,202 2,202 Total intangible assets $ 24,092 $ (7,266) $ 16,826 Amortization expense related to finite-lived intangible assets for the three months ended March 31, 2022 and 2021 was $931 and $1,248, respectively, and was included in depreciation and amortization in the accompanying condensed consolidated statements of operations and comprehensive (loss) income. The table below presents estimated future amortization expense for finite-lived intangible assets as of March 31, 2022: Amount Remainder of 2022 $ 2,952 2023 3,936 2024 3,483 2025 823 2026 770 Thereafter 1,729 Total $ 13,693 7. Leases The Company leases real estate for office space under operating leases. As of March 31, 2022, the remaining lease terms varied from 0.8 years to 3.3 years. For certain leases, the Company has an option to extend the lease term for a period of 5 years. This renewal option is not considered in the remaining lease term unless it is reasonably certain that the Company will exercise such options. Operating lease expense, included in rent and occupancy in the condensed consolidated statements of operations and comprehensive (loss) income, for the three months ended March 31, 2022 and 2021 was $1,142 and $830, respectively. Operating lease expenses exclude short-term lease costs and variable lease costs, each of which was immaterial for the three months ended March 31, 2022 and 2021. Sublease income of $87 and $0 for the three months ended March 31, 2022 and 2021 are included in other income, net in the condensed consolidated statements of operations and comprehensive (loss) income. F-17 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) The table below presents additional information related to the Company s operating leases: March 31, December 31, 2022 2021 Operating lease right-of-use assets $ 6,560 $ 7,881 Operating lease liabilities, current $ 5,221 $ 5,367 Operating lease liabilities, noncurrent $ 4,102 $ 5,159 Weighted-average remaining lease term (in years) 1.99 2.00 Weighted-average discount rate 4.8 % 4.9 % Future undiscounted lease payments under operating leases as of March 31, 2022 were as follows: Lease Payment Net Lease Obligation Sublease Income Obligation Remainder of 2022 $ 4,436 $ (262) $ 4,174 2023 4,030 (349) 3,681 2024 936 (349) 587 2025 393 (204) 189 2026 Total undiscounted lease payments $ 9,795 $ (1,164) $ 8,631 Less: Imputed interest (472) Present value of future lease payments $ 9,323 Less: operating lease liabilities, current 5,221 Operating lease liabilities, noncurrent $ 4,102 As of March 31, 2022, the Company did not have any additional significant lease contracts that had not yet commenced. During the three months ended March 31, 2022, the Company ceased using one of its leased office spaces and made a decision to sublease this space to a third party. The sublease agreement was signed in April 2022. Based on the terms of the sublease agreement, the Company determined that the right-of-use asset related to this office space is impaired, and recorded an impairment loss of $265 for the three months ended March 31, 2022 in rent and occupancy in the condensed consolidated statement of operations and comprehensive (loss) income. 8. Commitments and Contingencies The Company is subject to claims and lawsuits in the ordinary course of business, including arbitration, class actions and other litigation, some of which include claims for substantial or unspecified damages. The Company is also the subject of inquiries, investigations, and proceedings by regulatory and other governmental agencies. The Company reviews its lawsuits, regulatory inquiries and other legal proceedings on an ongoing basis and provides disclosures and records loss contingencies in accordance with the loss contingencies accounting guidance. The Company establishes an accrual for losses at management s best estimate when the Company assesses that it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. If no amount within the range is considered a better estimate than any other amount, an accrual for losses is recorded based on the bottom amount of the range. Accrual for loss contingencies are recorded in accounts payable and accrued expenses and other current liabilities on the condensed consolidated balance sheets and expensed in general and administrative expenses in our condensed consolidated statements of operations and comprehensive (loss) income. The Company monitors these matters for developments that would affect the likelihood of a loss and the accrued amount, if any, and adjusts the amount as appropriate. Legal Proceeding On January 7, 2022, Erika McKiernan, in her capacity as Stockholder Representative for the former stockholders of of SharesPost, filed a lawsuit against the Company in the Court of Chancery of the State of Delaware, asserting claims in connection with the Agreement and Plan of Merger, dated as of May 10, 2020, by and among the Company, Sharespost, Thanksgiving Merger Sub, Inc., and Erika McKiernan as the Stockhoder Representative, as amended on November 6, 2020 (the SharesPost Merger F-18 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) Agreement ). In general, the complaint asserts breaches of the SharesPost Merger Agreement and seeks declaratory judgements establishing those breaches The Company is unable to predict the outcome, nor the amount of time and expense that will be required to resolve this action. At this juncture, the Company does not believe this action will have a material adverse impact on its operations or financial position. The Company believes the allegations set forth in this action are without merit and intends to defend vigorously against the lawsuit. No provision for a loss contingency has been recorded as the amount of losses, if any, is not estimable as of March 31, 2022. 401(k) Plan The Company has established a tax-qualified retirement plan under Section 401(k) of the Internal Revenue Code for all of its U.S. employees, including executive officers, who satisfy certain eligibility requirements, including requirements relating to age and length of service. The Company matches 2% of every dollar contributed to the plan by employees, including executive officers, up to a maximum of $6. During the three months ended March 31, 2022 and 2021, the Company contributed $418 and $134, respectively, to the defined contribution plan. Non-Cancelable Purchase Obligations In the normal course of business, the Company enters into non-cancelable purchase commitments with various parties for purchases. As of March 31, 2022, the Company had outstanding non-cancelable purchase obligations with a term of 12 months or longer totaling $8,606. D&O Insurance Effective March 21, 2022, the Company entered into a D&O insurance policy with an annual premium totaling $5,782, which was fully paid in April 2022. The insurance may cover certain liabilities arising from the Company s obligation to indemnify its directors and certain of its officers and employees, and former officers, directors, and employees of acquired companies, in certain circumstances. 9. Off Balance Sheet Items The Company organizes a series of investment funds, each of which is represented by a limited liability company ( LLC ) within Forge Investments LLC and by portfolio companies within Forge Investments SPC and Forge Investments II SPC. The funds were formed for the purpose of investing in securities relating to a single private company. Each series of funds consists of a separate and distinct portfolio of investments owned by different investors. The Company utilizes third-party fund administrators to manage the funds and has no ownership interest nor participation in the gains or losses of the entities represented by the funds. The Company paid for the expenses incurred by these entities, including fund insurance expenses of $80 and $331, and fund management expenses of $21 and $30 for the three months ended March 31, 2022 and 2021, respectively, included in transaction-based expenses in condensed consolidated statements of operations and comprehensive (loss) income. Also, the Company paid fund audit fees of $315 and $461 during the three months ended March 31, 2022 and 2021, respectively, included in professional services in condensed consolidated statements of operations and comprehensive (loss) income. The Company did not consolidate Forge Investments LLC and Forge Investment SPC, or the investment funds, because the Company has no direct or indirect interest in Forge Investments LLC and Forge Investment SPC, or the investment funds, and the expenses that the Company pays on behalf of Forge Investments LLC and Forge Investment SPC, or the investment funds, are not significant to those entities. The Company believes its maximum exposure to loss resulting from its involvement with those entities is limited to the payment of future insurance expenses, management expenses and audit fees. F-19 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) 10. Capitalization Convertible Preferred Stock The following table summarizes Legacy Forge s convertible preferred stock as of December 31, 2021 (in thousands, except for share data): As of December 31, 2021 Number Number Carrying Aggregate Original of Shares of Shares Value Net of Liquidation Series Name Issuance Price Authorized Outstanding Issuance Costs Preference Series AA $ 0.9867 3,482,030 3,482,030 $ 3,435 $ 3,435 Series B $ 3.4132 20,660,715 20,660,715 70,045 70,519 Series B-1 $ 3.9760 49,809,148 42,133,496 150,553 167,523 Series B-2 $ 3.9760 2,515,083 412,623 1,640 1,640 Junior $ 3.9760 10,348,216 7,225,285 20,383 28,728 Total 86,815,192 73,914,149 $ 246,056 $ 271,845 Immediately prior to the effective time of the Merger, all series of convertible preferred stock of Legacy Forge were converted into shares of Class AA common stock of Legacy Forge on a one-for-one basis and then converted into the Company s common stock at the Exchange Ratio. As of March 31, 2022, no shares of convertible preferred stock were outstanding. Common Stock Prior to the Merger, Legacy Forge had authorized four classes of common stock: Class AA common stock, Class AA-1 common stock, Class EE-1 common stock and Class EE-2 common stock. Holders of such common stock were entitled to receive any dividends if and when such dividends are declared by the board of directors. Common stock was subordinated to the convertible preferred stock with respect to dividend rights and rights upon certain deemed liquidation events. Common stock was not redeemable at the option of the holder or by Legacy Forge. As of December 31, 2021, Legacy Forge was authorized to issue up to 257,968,554 shares of its capital stock, of which 171,153,360 shares were designated as common stock. The holders of the Class EE-1 common stock and Class AA common stock were entitled to one vote for each share and the holders of Class EE-2 common stock were entitled to (a) with respect to votes of one or more classes of common stock only, twenty votes for each share of Class EE-2 common stock and (b) with respect to Class EE-2 common stock voting together with any shares of preferred stock, one vote for each share of Class EE-2 common stock. Holders of common stock, voting together as a separate class, were entitled to appoint four members of the board of directors, who were deemed common directors. As of December 31, 2021, two members of the board of directors were elected by holders of common stock. Each share of Class AA common stock was convertible to one share of Class EE-1 common stock, up to a cumulative maximum of 1,873,758 shares of Class AA common stock, and each share of Class EE-1 common stock was convertible to one share of preferred stock upon authorization by the board of directors. In addition, each share of Class EE-1 or Class EE-2 was convertible, upon a disposition, to one share of Class AA common stock at the election of the holder. In April 2021, Legacy Forge amended and restated its certificate of incorporation to, (i) increase the number of authorized shares of all classes of stock (including preferred stock) to 257,968,554 and (ii) reclassify each share of Class EE-1 common stock and Class EE-2 common stock to one share of Class AA common stock. Merger Transaction On the Closing Date and in accordance with the terms and subject to the conditions of the Merger Agreement, each share of Legacy Forge Class AA common stock, par value $0.00001 per share, was canceled and converted into the right to receive the applicable portion of the merger consideration comprised of the Company s common stock, par value $0.0001 per share, based on the Exchange Ratio as determined in the Merger Agreement (the Exchange Ratio ). F-20 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) On March 21, 2022, in connection with the Merger, the Company amended and restated its certificate of incorporation to authorize 2,100,000,000 shares of capital stock, consisting of (i) 2,000,000,000 shares of common stock, par value $0.0001 per share and (ii) 100,000,000 shares of preferred stock. The holders of common stock have exclusive voting power. Each share of common stock is entitled to one vote per share. The Company s board of directors has the authority to issue shares of preferred stock in one or more series and to determine the preferences, privileges, and restrictions, including voting rights, of those shares. Upon the consummation of the Business Combination, the Company s common stock and warrants began trading on the NYSE under the symbol FRGE and FRGE WS , respectively. As of March 31, 2022, the Company had authorized 2,000,000,000 and 100,000,000 shares of common stock and preferred stock respectively, and the Company had 169,223,826 shares of common stock and no shares of preferred stock issued and outstanding. Settlement of Nonrecourse Related-Party Promissory Notes In connection with the Merger, the Company entered into a loan offset agreement with certain executives (the Loan Offset Agreement ) as a result of outstanding promissory notes that were due from these executives as of the Closing Date. As a result of the Loan Offset Agreement, the Company agreed to offset the after-tax value of the transaction bonus that the executives received in connection with the Merger (see Note 3) against the entire outstanding balance of the nonrecourse promissory notes, including any unpaid interest, as of one day immediately prior to the closing of the Merger. The total amount of outstanding promissory notes that were offset against the transaction bonus was $5,517, which included $1,310 related to unvested shares included in the accrued expenses and other current liabilities in the condensed consolidated balance sheets. The related bonus expense was recorded as compensation and benefits in the condensed consolidated statement of operations and comprehensive (loss) income for the three months ended March 31, 2022. 11. Warrants Warrants to Purchase Series B-1 Preferred Stock or Subsequent Round Stock In May 2020, Legacy Forge entered into a Note and Warrant Purchase Agreement with investors pursuant to which it issued certain convertible notes(the 2020 Convertible Notes ). In connection with the issuance of the 2020 Convertible Notes, the note holders entered into a Note and Warrant Purchase Agreement for the options to purchase shares based on coverage of 5% of the 2020 Convertible Notes principal amounts (the May 2020 Warrants ). The note holders can purchase either (i) the Series B-1 preferred stock of Legacy Forge at Series B-1 price of $3.9760 or (ii) any subsequent round stock of Legacy Forge at the subsequent round price. The warrants have a five-year contractual life and may be exercised at any time during that period. In October 2020, Legacy Forge entered into a Loan and Security Agreement ( 2020 Loan and Security Agreement ) with another lending institution that provided for a term loan in the amount of $15,000. In October 2020, simultaneously with the 2020 Loan and Security Agreement, the lender entered into a Warrant to Purchase Shares of Preferred Stock Agreement with Legacy Forge for the options to purchase a coverage amount of $3,513 of shares (the October 2020 Warrants ). The investors can purchase either the Series B-1 convertible preferred stock of Legacy Forge at Series B-1 price of $3.9760 or (ii) any subsequent round stock of Legacy Forge at the subsequent round price. The warrants have a ten-year contractual life and may be exercised at any time during that period. Prior to the Merger, the May 2020 Warrants and October 2020 Warrants were classified as liabilities in Legacy Forge s consolidated balance sheets. Legacy Forge remeasured the May 2020 Warrants and October 2020 Warrants at each balance sheet date to fair value (Note 4). Subsequent to the Merger, the May 2020 Warrants and October 2020 Warrants were converted to Legacy Forge s common stock warrants. As a result, the May 2020 Warrants and October 2020 Warrants were adjusted to fair value prior to conversion, and then settled in additional paid-in capital as a result of the conversion to equity-classified common stock warrants. The Company recorded changes in fair value of the May 2020 Warrants and October 2020 Warrants of $106 and $123 in change in fair value of warrant liabilities in the Company s condensed consolidated statements of operations and comprehensive (loss) income during the three months ended March 31, 2022 and 2021, respectively. F-21 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) Warrants to Purchase Junior Preferred Stock In November 2020, in connection with the SharesPost acquisition, Legacy Forge issued a total of 3,122,931 warrants ( Junior Preferred Warrants ) to purchase shares of Legacy Forge s Junior Preferred Stock at an exercise price of $3.9760 per share, with a cap of extended value of $5,000. The Junior Preferred Warrants have a five-year contractual life and may be exercised at any time during that period. Prior to the Merger, the warrants were classified as a liability in the condensed consolidated balance sheets. The Company remeasures the warrants at each balance sheet date using a hybrid method (Note 4). Subsequent to the Merger, the Junior Preferred Warrants were converted to the Company s common stock warrants. As a result, the Junior Preferred Warrants were adjusted to fair value prior to conversion and remain classified as a liability, as the Company has an obligation to issue a variable number of shares of common stock for a fixed monetary amount of $5,000. The Company recorded changes in fair value of the Junior Preferred Warrants that were converted to warrants to purchase common stock of $0 and $785 change in fair value of warrant liabilities in the Company s condensed consolidated statements of operations and comprehensive (loss) income during the three months ended March 31, 2022 and 2021, respectively. Public Warrants and Private Placement Warrants As the accounting acquirer, Legacy Forge is deemed to have assumed warrants for Class A common stock that were held by Motive Capital Funds Sponsor, LLC (the Sponsor ) at an exercise price of $11.50 ( Private Placement Warrants ), 13,800,000 Class A common stock warrants held by MOTV s shareholders at an exercise price of $11.50 ( Public Warrants ), and 4,666,664 Public Warrants at an exercise price of $11.50 that were issued in connection with the A&R FPA that was consummated upon the Closing Date. In accordance with the warrant agreement, warrants will become exercisable on April 21, 2022, subject to other terms of the warrant agreement, including but not limited to, the Company having an effective registration statement under the Securities Act covering the shares of common stock issuable upon exercise of the warrants and a current prospectus relating to them is available. The warrants will expire in five years after the completion of the Business Combination, or earlier upon redemption or liquidation. Subsequent to the Merger, the Private Placement Warrants and Public Warrants for shares of common stock meet liability classification requirements since the warrants may be required to be settled in cash under a tender offer. In addition, Private Placement Warrants are potentially subject to a different settlement amount as a result of being held by the Sponsor which precludes the Private Placement Warrants from being considered indexed to the entity s own stock. Therefore, these warrants are classified as liabilities on the condensed consolidated balance sheets. As of March 31, 2022, no warrants have been exercised. As of March 31, 2022, the following warrants were outstanding (in thousands, except for share and per share amounts): Exercise Price Warrant Type Shares per Share Public 18,466,604 $ 11.50 Private 7,386,667 $ 11.50 12. Share-Based Compensation Prior Stock Plan In March 2018, Legacy Forge adopted its 2018 Equity Incentive Plan, as amended from time to time, ( Amended 2018 Equity Incentive Plan or 2018 Plan ), which provides for grants of share-based awards, including stock options and restricted stock awards ( RSAs ), and other forms of share-based awards. The 2018 Plan was terminated in March 2022 in connection with the adoption of the 2022 Stock Plan (the 2022 Plan ). Accordingly, no shares are available for future issuances under the 2018 Plan following the adoption of the 2022 Plan. F-22 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) 2022 Stock Plan In March 2022, prior to and in connection with the Merger, the Company adopted the 2022 Plan, which provides for grants of share-based awards, including stock options and restricted stock units ( RSUs ), and other forms of share-based awards. The Company has reserved 12,899,504 shares of common stock for the issuance of awards under the 2022 Plan. In addition, the number of shares of common stock reserved and available for issuance under the 2022 Plan will automatically increase on January 1 of each year for a period of ten years, beginning on January 1, 2023 and on each January 1 thereafter and ending on the tenth anniversary of the adoption date of the 2022 Plan, in an amount equal to (1) 3% of the outstanding number of shares of common stock of the Company on the preceding December 31, or (2) a lesser number of shares as approved by the Company s board of directors. 2022 Employee Stock Purchase Plan In March 2022, prior to and in connection with the Merger, the Company adopted the 2022 Employee Stock Purchase Plan (the 2022 ESPP ). The 2022 ESPP authorizes the issuance of 4,072,000 shares of common stock under purchase rights granted to the Company s employees or to employees of any of its designated affiliates. The number of shares of common stock reserved for issuance will automatically increase on January 1 of each year, beginning on January 1, 2023 and each January 1 thereafter until the 2022 ESPP terminates according to its terms, by the lesser of (i) 4,072,000 shares of common stock, or (ii) 1% of the outstanding number of shares of common stock on the immediately preceding December 31. The Company s board of directors may determine that such increase will be less than the amount set forth in (i) and (ii) above. Reserve for Issuance The Company has the following shares of common stock reserved for future issuance, on an as-if converted basis: March 31, December 31, 2022 2021 Conversion of convertible preferred stock 86,815,192 Warrants to purchase convertible preferred stock 3,540,546 Warrants to purchase common stock 3,774,437 233,891 Shares available for grant under 2018 Plan 1,133,920 Stock options issued and outstanding under 2018 Plan 14,960,960 15,712,433 Shares available for grant under 2022 Plan 12,899,504 Stock options issued and outstanding under 2022 Plan Shares available for grant under 2022 ESPP 4,072,000 Outstanding Private Placement Warrants 7,386,667 Outstanding Public Warrants 18,466,604 Total shares of common stock reserved 61,560,172 107,435,982 F-23 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) Stock options Stock options generally vest over four years and expire ten years from the date of grant. Vested stock options generally expire from three months to five years after termination of employment. Stock option activity during the three months ended March 31, 2022 consisted of the following: Weighted Weighted- Average Exercise Averages Life Aggregate Stock Options Price (Years) Intrinsic Value Balance as of December 31, 2021 5,031,310 $ 6.85 9.2 years $ 120,491 Retroactive application of recapitalization 10,681,124 $ (4.66) Balance as of December 31, 2021 15,712,434 $ 2.19 Exercised (194,977) $ 0.54 Cancelled/Forfeited/Expired (556,497) $ 0.63 Balance as of March 31, 2022 14,960,960 $ 2.27 8.7 years $ 472,858 Vested and exercisable as of March 31, 2022 4,549,923 $ 0.80 8.0 years $ 150,512 The weighted-average grant date fair value of stock options granted during the three months ended March 31, 2022 and 2021 were $0 and $2.35 per share, respectively. The intrinsic value of stock options exercised during the three months ended March 31, 2022 and 2021 was $5,901 and $17,510, respectively. The total grant date fair value of stock options vested during the three months ended March 31, 2022 and 2021 was $5,736 and $2,495, respectively. The Company recorded share-based compensation of $7,757 and $991 for the three months ended March 31, 2022 and 2021, respectively, related to stock options. In addition, for the three months ended March 31, 2022, the Company recognized stock-based compensation expense of $621 related to pre-close issuance common stock for services. Future share-based compensation for unvested stock options granted and outstanding as of March 31, 2022, is $18,892, which is to be recognized over a weighted-average period of 2.57 years. Performance and Market Condition Options In May 2021, Legacy Forge s board of directors granted the Chief Executive Officer a performance and market condition-based option covering 3,122,931 shares of Legacy Forge s Class AA common stock with an exercise price of $3.9760 per share. The options are divided into three tranches of 1,040,976 options, 1,040,976 options and 1,040,979 options, corresponding to the three Aggregate Exit Proceeds Thresholds (as defined below). The awards vest only upon the satisfaction of (1) certain performance conditions, which is the occurrence of an IPO, merger with a SPAC, or a secondary sale for total proceeds of at least $250,000 and (2) market condition, which is holders of Legacy Forge s B-1 Preferred Stock having realized (i) aggregate exit proceeds with fair market value of at least $9.94, $14.91, and $19.88 per share (the Share Price Thresholds ); and (ii) an aggregate interest rate compounded annually which, when used as the discount rate to calculate the net present value, with respect to the occurrence of an IPO, merger with a SPAC or acquisition, that is equal to or greater than 20.0%, 30.0% and 35.0% (the IRR Thresholds , and together with the Share Price Thresholds, the Aggregate Exit Proceeds Thresholds ). In the event of an IPO or a merger with a SPAC, the Aggregate Exit Proceeds Thresholds are measured on the basis of the closing price average for any trailing 20 trading day period (the Measurement Period ) that occurs following such IPO or a merger with a SPAC, with the Measurement Period commencing upon expiration of the 180-day lock-up period following such IPO or merger with a SPAC, until the options expire or the Chief Executive Officer ceases to provide services to the Company. The options expire within 10 years less one day following the grant date. Upon consummation of the Business Combination, the performance condition was met and the Company recorded cumulative catch-up compensation expense of $4,564 during the three months ended March 31, 2022. The Company used the Monte Carlo simulation model to determine the fair value of the options with performance and market-based vesting conditions for purposes of calculating share-based compensation expense if vesting conditions met. The Monte Carlo simulation model incorporates the probability of satisfying performance and market conditions and uses transaction details such as stock price, contractual terms, maturity and risk-free interest rates, as well as volatility. The fair value of the options with no performance or market vesting conditions is based on the market value of common stock on the date of grant. The fair value of the F-24 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) performance-based stock options was $2.27 per option share estimated using the Monte Carlo simulation methodology. The unrecognized compensation expense was $2,532 as of March 31, 2022. Early Exercised Options Under the 2018 Plan, certain stock option holders may have the right to exercise unvested options, subject to a repurchase right held by the Company at the original exercise price, in the event of voluntary or involuntary termination of employment of the option holders, until the options are fully vested. As of March 31, 2022 and December 31, 2021, the cash proceeds received for unvested shares of common stock recorded within accrued expenses and other current liabilities in the condensed consolidated balance sheets were $1,554 and $785 as of March 31, 2022 and December 31, 2021, respectively, which will be transferred to additional paid-in capital upon vesting. Nonrecourse Promissory Notes to Early Exercise Stock Options In the three months ended March 31, 2021, certain executive officers of the company exercised stock options early by executing promissory notes. The Company has accounted for the promissory notes as nonrecourse in their entirety since the promissory notes are not aligned with a corresponding percentage of the underlying shares. Such arrangements were accounted for as modifications to the original stock options to which they relate, as the maturity date of the promissory notes reflects the legal term of the stock option for purposes of valuing the award. During the three months ended March 31, 2022, there were no promissory notes issued upon early exercise of options. All outstanding promissory notes have been settled as of March 31, 2022. Options Granted to Directors In July 2021, Legacy Forge s board of directors granted options to certain members of the board in connection with their services, to purchase 499,669 shares of Legacy Forge s Class AA common stock at exercise price of $5.43 per share. Subject to the option agreement, the options shall vest in full and become exercisable as of immediately prior to the consummation of a deemed liquidation event or SPAC transaction. The performance-based vesting condition for the options granted to certain board members was satisfied as of March 31, 2022 and the Company recorded $1,233 of share-based compensation expense related to the options granted to certain board members. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: Fair value of common stock $ 6.11 Expected term (years) 5.3 Expected volatility 40.0 % Risk-free interest rate 0.7 % Expected dividend yield 0.0 % RSAs Certain RSAs were granted to the Company s executives in exchange for a consideration at a specified strike price and were further subject to vesting condition. To the extent unvested, the shares issued in respect of such RSAs remain subject to repurchase. As of March 31, 2022, and December 31, 2021, there were 520,489 and no shares that were subject to repurchase, respectively, with the aggregate exercise price of $135 and $0, respectively. The related common stock unvested liability is included in accrued expenses and other current liabilities on the condensed consolidated balance sheet. The Company recorded share-based compensation expense of $148 and $148 for the three months ended March 31, 2022 and 2021, respectively, related to RSAs. As of March 31, 2022, the total unrecognized expense related to all RSAs was $223, which the Company expects to recognize over a weighted-average period of 0.25 years. F-25 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) 13. Income Taxes The Company s effective tax rate from continuing operations was (0.2)% and (0.9)% for the three months ended March 31, 2022 and 2021, respectively. The Company s full allowance in the United States caused the year-to-date effective tax rate to be different from the U.S. federal statutory tax rate. 14. Net Loss per Share Prior to the Merger and prior to effecting the recapitalization, the holders of Legacy Forge s Class AA, Class EE-1 and Class EE-2 common stock were entitled to the same right to participate in the Company s gains or losses. Therefore, net loss per share is presented as a single class of common stock. Earnings per share calculations for all periods prior to the Merger have been retrospectively restated to the equivalent number of shares reflecting the Exchange Ratio established in the reverse capitalization. Subsequent to the Merger, the Company has one class of common stock. The diluted net loss per share attributable to common stockholders is calculated by giving effect to all potentially dilutive common stock equivalents during the period using the two-class method. The Company s convertible notes, redeemable preferred stock, stock options, warrants, and early exercised stock options are considered to be potential common stock equivalents but have been excluded from the calculation of diluted net loss per share attributable to common stockholders because the holders of these securities do not have a contractual right to share in the Company s losses, and their effect would be antidilutive. Therefore, the net loss for the three months ended March 31, 2022 was attributed to common stockholders only. The following table sets forth the computation of basic and diluted net (loss) income per share attributable to common stockholders for the periods presented: Three Months Ended March 31, 2022 2021 Numerator: Net (loss) income attributable to common stockholders, basic $ (64,424) $ 938 Less: undistributed earnings attributable to participating securities $ $ (938) Net (loss) income attributable to common stockholders, diluted $ (64,424) $ Denominator: Weighted-average number of shares used to compute net (loss) income per share attributable to common stockholders, basic 66,007,461 61,598,361 Dilutive effect of common share equivalents 54,714,474 Weighted-average number of shares used to compute net (loss) income per share attributable to common stockholders, diluted 66,007,461 116,312,835 Net (loss) income per share attributed to common stockholders: Basic $ (0.98) $ 0.00 Diluted $ (0.98) $ 0.00 The following potentially dilutive shares were excluded in the calculation of diluted shares outstanding as the effect would have been anti-dilutive: Three Months Ended March 31, 2022 2021 Outstanding options 14,960,963 17,176 Common stock and preferred stock warrants 3,774,437 3,774,437 Public and Private Placement Warrants issued upon Merger 25,853,271 Common stock subject to repurchase 3,018,878 Convertible notes 693,078 Total 47,607,549 4,484,691 F-26 Table of Contents FORGE GLOBAL HOLDINGS, INC. NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (In thousands of U.S. dollars, except share and per share data) 15. Related Party Transactions In October 2019, Legacy Forge issued convertible notes to investors, of which $2,400 was received from certain directors and employees of Legacy Forge. As of December 31, 2020, Legacy Forge had a $2,400 related party balance on convertible notes outstanding. The notes were fully repaid in January 2021. Legacy Forge entered into client engagement agreements with certain companies to serve as exclusive transaction agent to help facilitate private purchases of shares of issuers. These companies are identified as related parties who are holders of either Legacy Forge s common stock or redeemable convertible preferred stock. The Company recognized $631 in placement fee revenue in the condensed consolidated statements of operations and comprehensive (loss) income for trade executed with the underlying LLCs and portfolio companies for the three months ended March 31, 2022. The associated revenue recognized for the three months ended March 31, 2021 is immaterial. The Company obtains insurance coverage from Munich Re, a shareholder of the Company, to indemnify Forge Investments for its contractual obligations to funds investors if shareholders fail to transfer ownership interests upon certain trigger events. During the three months ended March 31, 2022 and 2021, the Company incurred $80 and $331 in insurance premiums, respectively, and are included in transaction-based expenses in the condensed consolidated statements of operations and comprehensive (loss) income. Financial Technology Partners LP ( Financial Technology Partners ), a shareholder of the Company, serves as financial and strategic advisor to the Company on its financing, merger, and acquisition transactions. During the three months ended March 31, 2022, the Company incurred $18,283 in fees to Financial Technology Partners, of which $17,356 was related to common stock issued during the Merger and was recorded as a reduction to additional paid-in capital. The remaining $927 was related to issuance of Public and Private Placement Warrants, including warrants issued to A&R FPA investors, and was expensed immediately upon consummation of the Merger as acquisition-related transaction cost in the condensed consolidated statements of operations and comprehensive (loss) income. The Company leases one of its office spaces from the former owner of IRA Services. The former owner became a shareholder of the Company upon the acquisition of IRA Services which subsequently renamed as Forge Trust. IRA Services was a non-depository trust company authorized to act as a custodian of self-directed individual retirement accounts. The Company incurred $94 in rent to this shareholder during the three months ended March 31, 2022 and 2021, respectively, and are included in rent and occupancy in the condensed consolidated statements of operations and comprehensive (loss) income. James Herbert, II, one of the Company s directors, through the James and Cecillia Herbert 1994 Revocable Trust, purchased 75,000 shares of the Company s s common stock (for a purchase price of $750) in the PIPE Investment, concurrently and in connection with the closing of the Business Combination. Mr. Herbert s transaction was on the same terms as the other investors who purchased shares in the PIPE Investment pursuant to certain subscription agreements dated September 13, 2021. Prior to the Business Combination, one of Legacy Forge s directors was also a director of Temasek Holding (Private) Limited ( Temasek ). Temasek, through its wholly-owned subsidiary, Ossa Investments Pte. Ltd, purchased 1,000,000 shares of the Company s s common stock (for a purchase price of $10,000) in the PIPE Investment, concurrently and in connection with the closing of the Business Combination. This transaction was on the same terms as the other investors who purchased shares in the PIPE Investment pursuant to certain subscription agreements dated September 13, 2021. 16. Subsequent Events In accordance with ASC Topic 855-10, the Company has analyzed its operations subsequent to March 31, 2022 to the date these financial statements were issued and has determined that it does not have any material subsequent events to disclose or recognize in the accompanying financial statements. F-27 Table of Contents Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of Forge Global, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Forge Global, Inc. (the Company) as of December 31, 2021 and 2020, the related consolidated statements of operations and comprehensive loss, changes in convertible preferred stock and stockholders deficit and cash flows for each of the two years in the period ended December 31, 2021, and the related notes and schedule II (collectively referred to as the consolidated financial statements ). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2021, in conformity with U.S. generally accepted accounting principles. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. /s/ Ernst & Young LLP We have served as the Company s auditor since 2021. San Francisco, California March 21, 2022 F-28 Table of Contents FORGE GLOBAL, INC. Consolidated Balance Sheets (In thousands of U.S. dollars, except share and per share data) As of December 31, 2021 2020 Assets Current assets: Cash and cash equivalents $ 74,781 $ 40,577 Restricted cash 1,623 1,601 Accounts receivable, net 5,380 5,741 Payment-dependent notes receivable at fair value, current 1,153 39,289 Prepaid expenses and other current assets 5,148 4,146 Total current assets $ 88,085 $ 91,354 Property and equipment, net 497 897 Internal-use software, net 2,691 1,575 Goodwill and other intangible assets, net 137,774 140,410 Operating lease right-of-use assets 7,881 8,983 Payment-dependent notes receivable at fair value, noncurrent 13,453 13,735 Other assets, noncurrent 7,514 1,548 Total assets $ 257,895 $ 258,502 Liabilities, convertible preferred stock and stockholders deficit Current liabilities: Accounts payable $ 1,920 $ 2,612 Accrued compensation and benefits 21,240 13,159 Accrued expenses and other current liabilities 8,343 7,288 Operating lease liabilities, current 5,367 3,536 Debt, current 2,499 Payment-dependent notes payable at fair value, current 1,153 39,289 Total current liabilities $ 38,023 $ 68,383 Debt, noncurrent 16,431 Operating lease liabilities, noncurrent 5,159 8,824 Payment-dependent notes payable at fair value, noncurrent 13,453 13,735 Warrant liabilities, at fair value 7,844 1,780 Total liabilities $ 64,479 $ 109,153 Commitments and contingencies (Note 8) Convertible preferred stock, net of issuance costs, $0.00001 par value; 27,799,267 and 22,520,015 shares authorized as of December 31, 2021 and 2020, respectively; 23,668,198 and 15,717,345 shares issued and outstanding as of December 31, 2021 and 2020, respectively; aggregate liquidation preference of $271,845 and $173,122 as of December 31, 2021 and 2020, respectively 246,056 156,848 Stockholders deficit: Common stock, $0.00001 par value; Class AA 54,000,000 and 52,000,000 shares authorized as of December 31, 2021 and 2020, respectively, 20,269,864 and 21,110,877 shares issued and outstanding as of December 31, 2021 and 2020, respectively; Class AA-1 805,360 and zero shares authorized as of December 31, 2021 and 2020, respectively, no shares issued and outstanding as of December 31, 2021 and 2020, respectively; Class EE-1 zero and 105,000 shares authorized, issued and outstanding as of December 31, 2021 and 2020, respectively; Class EE-2 zero and 1,557,500 shares authorized, issued and outstanding as of December 31, 2021 and 2020, respectively Additional paid-in capital 25,919 52,561 Accumulated deficit (78,559) (60,060) Total stockholders deficit $ (52,640) $ (7,499) Total liabilities, convertible preferred stock and stockholders deficit $ 257,895 $ 258,502 The accompanying notes are an integral part of the consolidated financial statements. F-29 Table of Contents FORGE GLOBAL, INC. Consolidated Statements of Operations and Comprehensive Loss (In thousands of U.S. dollars, except share and per share data) Year Ended December 31, 2021 2020 Revenues Placement fees $ 107,723 $ 29,240 Custodial administration fees 20,333 22,404 Total revenues $ 128,056 $ 51,644 Transaction-based expenses: Transaction-based expenses (3,034) (3,888) Total revenues, less transaction-based expenses $ 125,022 $ 47,756 Operating expenses: Compensation and benefits $ 94,654 $ 37,330 Professional services 12,450 3,371 Acquisition-related transaction costs 882 3,289 Advertising and market development 5,090 1,528 Rent and occupancy 3,744 2,381 Technology and communications 8,243 4,616 General and administrative 4,358 452 Depreciation and amortization 5,390 2,406 Total operating expenses $ 134,811 $ 55,373 Operating loss $ (9,789) $ (7,617) Interest expenses and other income (expenses): Interest expense, net (2,307) (2,405) Change in fair value of warrant liabilities (6,064) (292) Other income (expenses), net 47 (201) Total interest expenses and other expenses $ (8,324) $ (2,898) Loss before provision for income taxes (18,113) (10,515) Provision for (benefit from) income taxes 386 (803) Net loss and comprehensive loss $ (18,499) $ (9,712) Net loss per share attributable to common stockholders, basic and diluted $ (1.06) $ (0.81) Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted 17,386,008 11,946,614 The accompanying notes are an integral part of the consolidated financial statements. F-30 Table of Contents FORGE GLOBAL, INC. Consolidated Statements of Changes in Convertible Preferred Stock and Stockholders Deficit (In thousands of U.S. dollars, except share and per share data) Convertible Preferred Stock Common Stock Additional Paid-In Accumulated Shares Amount Shares Amount Capital Deficit Total Balance as of December 31, 2019 8,697,229 $ 84,998 13,635,614 $ (*) $ 2,785 $ (50,348) $ (47,563) Issuance of Series B-1 convertible preferred stock at $12.4168 per share, net of issuance costs of $2,713 3,562,869 41,527 Issuance of Series B-1 convertible preferred stock at $8.69 per share upon conversion of convertible notes and accrued interest 1,143,624 9,940 Issuance of Class AA common stock upon exercise of vested stock options 20,500 (*) 21 21 Issuance of Class AA common stock upon early exercise of unvested stock options 287,278 Repurchase of early exercised stock options (171,240) Repurchase of restricted stock awards (13,915) Issuance of Class AA common stock in connection with SharesPost acquisition 9,015,140 (*) 44,817 44,817 Issuance of Junior convertible preferred stock in connection with SharesPost acquisition 2,313,623 20,383 Vesting of early exercised stock options 32 32 Share-based compensation expense 4,906 4,906 Net loss (9,712) (9,712) Balance as of December 31, 2020 15,717,345 $ 156,848 22,773,377 $ (*) $ 52,561 $ (60,060) $ (7,499) Issuance of Series B-1 convertible preferred stock at $12.4168 per share upon conversion of convertible notes and accrued interest 8,949 111 Issuance of Series B-1 convertible preferred stock at $12.4168 per share, net of issuance costs of $2,838 4,072,904 47,735 Issuance of Series B-2 convertible preferred stock at $12.4168 per share 132,127 1,640 Issuance of Class AA common stock upon exercise of vested stock options, including stock options exercised via promissory notes 413,172 (*) 704 704 Issuance of Class AA common stock upon early exercise of unvested stock options 834,064 Repurchase of early exercised stock options (13,876) Exchange of Class AA common stock for Series B-1 convertible preferred stock 3,736,873 39,722 (3,736,873) (*) (39,722) (39,722) Vesting of early exercised stock options 145 145 Share-based compensation expense 12,231 12,231 Net loss (18,499) (18,499) Balance as of December 31, 2021 23,668,198 $ 246,056 20,269,864 $ (*) $ 25,919 $ (78,559) $ (52,640) (*) amount less than 1 The accompanying notes are an integral part of the consolidated financial statements. F-31 Table of Contents FORGE GLOBAL, INC. Consolidated Statements of Cash Flows (In thousands of U.S. dollars, except share and per share data) Year Ended December 31, 2021 2020 Cash flows from operating activities: Net loss $ (18,499) $ (9,712) Adjustments to reconcile net loss to net cash provided by operations: Share-based compensation 12,231 4,906 Depreciation and amortization 5,390 2,406 Amortization of right-of-use assets 2,804 1,638 Change in fair value of warrant liabilities 6,064 292 Other 107 886 Changes in operating assets and liabilities: Accounts receivable 382 (3,386) Prepaid expenses and other assets (1,031) (2,191) Accounts payable (692) (1,683) Accrued expenses and other current liabilities (399) 2,138 Accrued compensation and benefits 8,080 3,869 Operating lease liabilities (3,536) (1,691) Net cash provided by (used in) operating activities $ 10,901 $ (2,528) Cash flows from investing activities: Cash paid for acquisitions, net of cash acquired (13,114) Purchases of property and equipment (13) Purchases of intangible assets (2,202) Capitalized internal-use software development costs (1,054) (1,149) Loan to SharesPost (3,000) Payment of deferred payments related to IRA Services acquisition (6,097) Net cash used in investing activities $ (3,256) $ (23,373) Cash flows from financing activities: Proceeds from issuance of Series B-1 convertible preferred stock, net of issuance costs 47,735 41,527 Proceeds from issuance of Series B-2 convertible preferred stock, net of issuance costs 1,640 Proceeds from exercise of options, including proceeds from repayment of promissory notes 1,621 24 Proceeds from notes payable 25,566 Repayment of notes payable (19,438) (27,688) Payments of deferred offering costs (4,954) Cash paid to purchase equity awards (23) (49) Net cash provided by financing activities $ 26,581 $ 39,380 Net increase in cash and cash equivalents 34,226 13,479 Cash, cash equivalents and restricted cash, beginning of year 42,178 28,699 Cash, cash equivalents and restricted cash, end of year $ 76,404 $ 42,178 Supplemental disclosures of cash flow information: Cash paid for interest $ 2,118 $ 425 Supplemental disclosure of non-cash investing and financing activities: Operating lease right-of-use assets recognized in exchange for new operating lease obligations $ 1,702 $ Deferred offering costs accrued and not yet paid $ 969 $ Capitalized internal-use software development costs accrued and not yet paid $ 214 $ Deferred payments related to SharesPost acquisition $ $ 783 Forgiveness of loan to SharesPost in relation to acquisition $ $ 3,000 Issuance of Junior convertible preferred stock in relation to SharesPost acquisition $ $ 20,383 Issuance of Junior convertible preferred stock warrants in relation to SharesPost acquisition $ $ 1,285 Issuance of Class AA common stock in relation to SharesPost acquisition $ $ 44,817 Exchange of Class AA common stock for Series B-1 convertible preferred stock $ 39,722 $ Conversion of convertible notes into Series B-1 convertible preferred stock $ 111 $ 9,940 Vesting of early exercised stock options and restricted stock awards $ 145 $ 32 Warrant issued in connection with issuance of convertible notes payable $ $ 51 Warrant issued in connection with issuance of term loan $ $ 151 The accompanying notes are an integral part of the consolidated financial statements. F-32 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data 1. Description of Business and Summary of Significant Accounting Policies Description of Business Forge Global, Inc. (collectively with its subsidiaries, Forge, the Company, or its ) is a financial services platform. Founded in 2014, to serve the unique needs of the private market, the Company was incorporated in the state of Delaware and is headquartered in San Francisco, California. Since its founding, Forge has built a trusted marketplace that makes purchases and sales of equity in private companies simple, transparent, and highly efficient to scale. The Company has strategically invested in technology to provide individual and institutional participants an efficient and liquid market, access to a large number of private company investment opportunities and the information and transparency they need to make well informed investment decisions. By digitizing a historically analog, complex and opaque process, Forge s platform delivers opportunities to trade in private company stocks. Today, Forge is a leading provider of mission-critical infrastructure technology and services for the private market. In August 2021, two of the Company s subsidiaries, Forge Markets LLC and SharesPost, Inc. ceased to operate. The Company began operating as a single broker dealer under the entity Forge Securities LLC to provide an integrated investing experience for investors. Proposed Business Combination In September 2021, the Company entered into an Agreement and Plan of Merger ( Merger Agreement ) by and among the Company; Motive Capital Corp ( MOTV ), a publicly traded special purpose acquisition company and Cayman Islands exempted company; and FGI Merger Sub, Inc., a Delaware corporation and a direct wholly owned subsidiary of MOTV ( Merger Sub ), providing for, among other things, and subject to the conditions therein, the combination of the Company and MOTV pursuant to the proposed merger of Merger Sub with and into the Company with the Company continuing as the surviving entity and a direct wholly owned subsidiary of MOTV, which will be renamed Forge Global Holdings, Inc. ( New Forge ). Basis of Presentation and Consolidation The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America ( GAAP ) and include the accounts of Forge Global, Inc., and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. In the normal course of business, the Company has transactions with various investment entities as discussed in Note 9, Off Balance Sheet Items. In certain instances, the Company provides investment advisory services to pooled investment vehicles ( Funds ). The Company does not have discretion to make any investment, except for the specific investment for which the Fund was formed. The Company performs an assessment to determine (a) whether the Company s investments or other interests will absorb portions of a variable interest entity s expected losses or receive portions of the entity s expected residual returns and (b) whether the Company s involvement, through holding interests directly or indirectly in the entity would give it a controlling financial interest. The Company consolidates entities in which it, directly or indirectly, is determined to have a controlling financial interest. Consolidation conclusions are reviewed quarterly to identify whether any reconsideration events have occurred. Segment Information The Company operates as a single operating segment and reportable segment. The Company s chief operating decision maker is its Chief Executive Officer, who reviews financial information presented on a consolidated basis for purposes of making operating decisions, assessing financial performance, allocating resources and evaluating the Company s financial performance. The Company operates primarily in the United States, and, accordingly, the geographic distribution of revenue and assets is not significant. For the years ended December 31, 2021 and 2020, revenue outside of the United States, based on customers billing address was not material. As of December 31, 2021 and 2020, long-lived assets located outside of the United States were not material. F-33 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Such management estimates include, but are not limited to timing of revenue recognition from placement fees and custodial administration fees, collectability of accounts receivable, the fair value of financial assets and liabilities, the fair value of assets acquired and liabilities assumed in business combinations, the fair value of consideration paid for business combinations, the useful lives of acquired intangible assets and property and equipment, the impairment of long-lived assets and goodwill, the fair value of warrants, equity awards and share-based compensation expenses including the determination of the fair value of the Company s common stock, and the valuation of deferred tax assets and uncertain tax positions. These estimates are inherently subjective in nature and, therefore, actual results may differ from the Company s estimates and assumptions. The Company bases its estimates on historical experience and also on assumptions that it believes are reasonable. From 2020, the novel coronavirus ( COVID-19 ) pandemic created disruption in global supply chains, increased rates of unemployment and adversely impacted many industries. In 2021, although most of the initial restrictions imposed at the onset of the pandemic in the U.S. have been relaxed or lifted as a result of the distribution of vaccines, the COVID-19 pandemic continues to persist. We continue to closely monitor developments; however, we cannot predict the future impact of COVID-19 on our operational and financial performance, or the specific ways the pandemic may uniquely impact our members, all of which continue to involve significant uncertainties that depend on future developments, which include, among others, the severity and duration of the pandemic and its impact on the overall economy and other industry sectors; vaccination rates; the longer-term efficacy of vaccinations; and the potential emergence of new, more transmissible or severe variants. The Company believes the estimates and assumptions underlying the consolidated financial statements are reasonable and supportable based on the information available as of December 31, 2021. These estimates may change as new events occur and additional information is obtained, and related financial impacts will be recognized in the Company s consolidated financial statements as soon as those events become known. Fair Value Measurements Fair value is defined as the exchange price that would be received from the sale of an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. When developing fair value measurements, the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs. A financial instrument s classification within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurements. Three levels of inputs may be used to measure fair value: Level 1 Quoted prices in active markets for identical assets or liabilities. Level 2 Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less from the date of purchase to be cash equivalents. Cash and cash equivalents consist primarily of bank deposit accounts and investments in money market funds. F-34 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data Restricted Cash The Company classifies all cash and cash equivalents that are not available for immediate or general business use as restricted in the accompanying consolidated balance sheets. This includes amounts set aside for restrictions of specific agreements. As of December 31, 2021 and 2020, the restricted cash represents the amount covered by the letter of credit related to one of the Company s operating leases and for regulatory purposes for the trust and brokerage-related activities. Accounts Receivable, Net Accounts receivable consist of amounts billed and currently due from customers, which are subject to collection risk. The allowance for doubtful accounts is based on the Company s assessment of the collectability of accounts. The Company regularly reviews the adequacy of the allowance for doubtful accounts based on a combination of factors, including an assessment of the customer s aging balance, the financial condition of the customer, and the amount of any receivables in dispute. Accounts receivable deemed uncollectable are charged against the allowance for doubtful accounts when identified. The total allowance for doubtful accounts netted against account receivables in the consolidated balance sheets was $1,517 and $1,538 as of December 31, 2021 and 2020, respectively. Concentration of Credit Risks Financial instruments that potentially subject the Company to concentrations of credit risk primarily comprise cash and cash equivalents and restricted cash, payment-dependent notes receivables, and accounts receivables. Cash and cash equivalents and restricted cash may, at times, exceed amounts insured by the Federal Deposit Insurance Corporation and the Securities Investor Protection Corporation, respectively. The Company s exposure to credit risk in the event of default by financial institutions is limited to the amounts recorded on the consolidated balance sheets. The Company performs periodic evaluations of the relative credit standing of these financial institutions to limit the amount of credit exposure. The Company has not experienced any losses on its deposits of cash and cash equivalents to date. The Company s exposure to credit risk associated with its contracts with holders of private company equity ( sellers ) and investors ( buyers ) related to the transfer of private securities is measured on an individual counterparty basis. Concentrations of credit risk can be affected by changes in political, industry, or economic factors. To reduce the potential for risk concentration, the Company s exposure is monitored in light of changing counterparty and market conditions. As of December 31, 2021 and 2020, the Company did not have any material concentrations of credit risk outside the ordinary course of business. As of December 31, 2021 and 2020, no customers accounted for more than 10% of the Company s accounts receivable. No customer accounted for more than 10% of total revenue, less transaction-based expenses for the years ended December 31, 2021 and 2020, respectively. Property and Equipment, Net Property and equipment are stated at cost net of accumulated depreciation and amortization. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets. Expenditures for maintenance and repairs are expensed as incurred. When property and equipment are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the consolidated balance sheets, and any resulting gain or loss is reflected in consolidated statements of operations and comprehensive loss in the period realized. The estimated useful lives of the Company s property and equipment are as follows: Computer equipment 3 years Furniture and fixtures 5 years Leasehold improvements The shorter of remaining lease term or estimated useful life F-35 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data Internal-use Software, Net The Company capitalizes certain costs related to software developed for its internal-use. The costs capitalized include development of new software features and functionality and incremental costs related to significant improvement of existing software. Development costs incurred during the preliminary or maintenance project stages are expensed as incurred. Costs incurred during the application development stage are capitalized and amortized using the straight-line method over the useful life of the software, which is typically three years. Amortization begins only when the software becomes ready for its intended use. Costs incurred after the project is substantially complete and is ready for its intended purpose, such as maintenance and training costs, are expensed as incurred, unless related to significantly increasing the functionality of existing software. Business Combinations The Company accounts for its business combinations using the acquisition accounting method wherein the purchase price is allocated based on the estimated fair value of identifiable assets acquired and liabilities assumed. Any residual purchase price is recorded as goodwill. The Company identifies and attributes fair values and estimated lives to the intangible assets acquired. The estimates in determining the fair values of assets acquired and liabilities assumed can include, but are not limited to, the cash flows that an asset is expected to generate in the future, the cost savings expected to be derived from acquiring an asset and the appropriate weighted-average cost of capital. These estimates are inherently uncertain and unpredictable. During the measurement period, which was up to one year from the acquisition date, the Company did not have adjustments to the fair value of any assets acquired and liabilities assumed. In addition, uncertain tax positions and tax-related valuation allowances were initially recorded in connection with a business acquisition as of the acquisition date. Upon the conclusion of the measurement period, there was no subsequent adjustments recorded in the consolidated statements of operations and comprehensive loss. Acquisition costs, such as legal and consulting fees, were expensed as incurred. Goodwill and Other Intangible Assets, Net Goodwill represents the excess of the aggregate fair value of the consideration transferred in a business combination over the fair value of the assets acquired, net of liabilities assumed. Goodwill is not amortized but is tested for impairment annually, or more frequently if events or changes in circumstances indicate the goodwill may be impaired. The Company has historically performed its annual impairment assessment for goodwill and indefinite life intangible assets as of the last day of the fiscal year (December 31). During the third quarter of fiscal 2021, the Company voluntarily changed the date of its annual impairment assessment from December 31 to October 1. The change is to closely align the yearly impairment assessment dates with the Company s annual planning and budgeting process. The Company has determined this change in accounting principle is preferable and will not affect the consolidated financial statements. The change in the assessment date does not delay or avoid a potential impairment charge, and this change is applied prospectively as retrospective application would be impracticable as the Company is unable to objectively determine, without the use of hindsight, the significant assumptions and estimates that would be used in those earlier periods. The tests did not result in an impairment to goodwill during the years ended December 31, 2021 and 2020. In-process research and development ( IPR&D ) assets acquired in a business combination are considered indefinite lived until the completion or abandonment of the associated research and development efforts. Upon conclusion of the relevant research and development project, the Company will amortize the acquired IPR&D over its estimated useful life or expense the acquired IPR&D should the research and development project be unsuccessful with no future alternative use. In September 2021, the Company has launched the acquired IPR&D data platform and started to record amortization expense using the straight-line method over the estimated useful lives of the asset. Acquired intangible assets also consist of identifiable intangible assets, primarily software technology, trade name and customer relationships, resulting from business acquisitions. Finite-lived intangible assets are recorded at fair value on the date of acquisition and are amortized over their estimated useful lives. The Company bases the useful lives and related amortization expense on its estimate of the period that the assets will generate revenues or otherwise be used. F-36 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data Impairment of Long-Lived Assets The Company s long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of the asset may not be recoverable. The Company also evaluates the period of depreciation and amortization of long-lived assets to determine whether events or circumstances warrant revised estimates of useful lives. When indicators of impairment are present, the Company determines the recoverability of its long-lived assets by comparing the carrying value of its long- lived assets to future undiscounted net cash flows expected to result from the use of the assets and their eventual disposition. If the estimated future undiscounted cash flows demonstrate the long-lived assets are not recoverable, an impairment loss would be calculated based on the excess of the carrying amounts of the long-lived assets over their fair value. The Company did not record impairment loss for the years ended December 31, 2021 and 2020. Leases The Company categorizes leases at their inception or upon modification, if applicable. As of December 31, 2021 and 2020, the Company only has operating leases. For operating leases, the Company recognizes rent and occupancy on a straight-line basis, commencing on the date at which control and possession of the property is obtained. For leases with a term greater than 12 months, the Company records the related right-of-use assets and operating lease liabilities at the present value of lease payments over the lease term. The Company does not separate lease and non-lease components of contracts for real estate property leases. Variable lease payments for common area maintenance, property taxes and other operating expenses are recognized as expense in the period when the changes in facts and circumstances on which the variable lease payments are based occur. The rates implicit on the Company s leases are not readily determinable. Therefore, the Company estimates its incremental borrowing rate to discount the lease payments based on information available at lease commencement. The Company determines its incremental borrowing rate based on the rate of interest it would have to pay to borrow on a collateralized basis with an equal lease payment amount, over a similar term, and in a similar economic environment. The Company evaluates its subleases in which it is the sublessor to determine whether it is relieved of the primary obligation under the original lease. If it remains the primary obligor, the Company continues to account for the original lease as it did before the commencement of the sublease and reports the sublease income based on the contract terms. Payment-Dependent Notes The Company has entered into separate contracts with equity holders of private companies shares ( sellers ) and investors ( buyers ) that enable the transfer of private securities upon a specified event such as an initial public offering, merger, or acquisition involving the underlying company. The Company serves as an intermediary counterparty to both the buyer and the seller and earns transaction fee revenue by facilitating the execution of the transaction. Contracts with buyers require the Company to facilitate the transfer of a fixed number of shares of the private securities from sellers upon occurrence of a specified event as described above. Buyers are required to pay the selling price for shares purchased ( settlement amounts ) and transaction fee defined in the contracts into a distribution or escrow account upon notice by the Company. Contracts with sellers require sellers to transfer the same amount and class of shares referenced in the contract between the Company and the corresponding buyers upon the occurrence of a specified event as described above. When settlement amounts have been determined, and the price and transaction fees are paid by the buyer, payment-dependent notes receivable are recorded for the securities due from the sellers, and payment- dependent notes payable are recorded for the securities owed to the buyers. Amounts recorded at period- end for payment-dependent notes receivable represent the fair value of securities receivable from sellers, for which the securities settlement event has not occurred. Amounts recorded at period-end for payment- dependent notes payable represent the fair value of securities not yet delivered to the buyer. Payment- dependent notes receivable and payment-dependent notes payable are presented at fair value in the consolidated financial statements in accordance with ASC 825, Fair Value Option for Financial Instruments. Changes in fair value of payment-dependent notes receivable and payment-dependent notes payable are recorded in other expense in the consolidated statements of operations and comprehensive loss. F-37 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data Deferred Offering Costs Deferred offering costs consist primarily of accounting, legal, and other fees directly related to the Company s proposed public offering. Upon consummation of the proposed public offering, the deferred offering costs will be reclassified to stockholders deficit and recorded against the proceeds from the offering. In the event the offering is aborted, deferred offering costs will be expensed. As of December 31, 2021, $5,923 of deferred offering costs were capitalized in other assets, noncurrent in the accompanying consolidated balance sheets. No offering costs were capitalized as of December 31, 2020. Revenue Recognition and Transaction-Based Expenses The Company generates revenue from fees charged for the trading of private placements on its marketplace platform, and fees for account and asset management provided to customers. The Company disaggregates revenue by service type, as management believes that this level of disaggregation best depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are impacted by economic factors. The Company recognizes revenue pursuant to ASC 606, Revenue from Contracts with Customers. The amount of revenue recognized reflects the consideration that the Company expects to receive in exchange for services. To achieve the core principle of this standard, the Company applied the following five steps: 1.Identification of the contract, or contracts, with the customer; 2.Identification of the performance obligations in the contract; 3.Determination of the transaction price; 4.Allocation of the transaction price to the performance obligations in the contract; and 5.Recognition of the revenue when, or as, a performance obligation is satisfied. Revenue from Contracts with Customers The Company enters into contracts with customers that can include various services, which are capable of being distinct and accounted for as separate performance obligations. When applicable, an allocation of the transaction fees to the performance obligations or to the distinct goods or services that form part of a single performance obligation will depend on the individual facts and circumstances of the contract. All of the Company s revenues are from contracts with customers. The Company is the principal in its contracts, with the exception of sub-account fees, in which the Company acts as an agent and records revenue from fees earned related to cash balances in customers custodial accounts. Each of our significant performance obligations and our application of ASC 606 to our revenue arrangements are discussed in further detail below: Placement Fees The Company maintains a trading platform which generates revenues by collecting transaction fees from institutions, individual investors and private equity holders. Placement fees are charged by the Company for meeting the point-in-time performance obligation of executing a private placement on its platform. Placement fee rates are individually negotiated for each transaction and vary depending on the specific facts and circumstance of each agreement. These fees are event-driven and invoiced upon the closing of the transaction outlined in each agreement. These fees may be expressed as a dollar amount per share, a flat dollar amount, or a percentage of the gross transaction proceeds. The Company earns agency placement fees in non-underwritten transactions, such as private placements of equity securities. The Company enters into arrangements with individual accredited customers or pooled investment vehicles to execute private placements in the secondary market. The Company will receive placement fees on these transactions and believes that its trade execution performance obligation is completed upon the placement and consummation of a transaction and, as such, revenue is earned on the transaction date with no further obligation to the customer at that time. The Company acts as a principal and recognizes the placement fee revenue earned for the execution of a trade on a gross basis. F-38 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data Custodial Administration Fees The Company generates revenues primarily by performing custodial account administration and maintenance services for its customers. Specifically, the Company charges administration fees for its services in maintaining custodial accounts, including asset-based fees, which are determined by the number and types of assets in these accounts. Additionally, the Company earns fees for opening and terminating accounts, and facilitating transactions, which are assessed at the point of transaction. Account and asset fees are assessed on the first day of the calendar quarter. Cash administration fees are based on cash balances within the custodial accounts and are assessed on the last day of the month. Revenues from custodial administration fees are recognized either over time as underlying performance obligations are met and day-to-day maintenance activities are performed for custodial accounts, or at a point in time upon completion of transactions requested by custodial account holders. Contract Balances Contract assets represent amounts for which we have recognized revenue for contracts that have not yet been invoiced to our customers. The Company does not have any contract assets as of December 31, 2021 and 2020. Contract liabilities consist of deferred revenue, which relates to amounts invoiced in advance of performance under a revenue contract. The total contract liabilities of $357 and $161 as of December 31, 2021 and 2020, respectively, related to advance billings for placement fees and custodial administration fees, recorded in accrued expenses and other current liabilities on the consolidated balance sheets. Practical Expedients In certain arrangements, the Company receives payment from a customer either before or after the performance obligation has been satisfied; however, the contracts do not contain a significant financing component. The Company has applied the practical expedient in ASC 606 and excludes information about a) remaining performance obligations that have an original expected duration of one year or less and b) transaction price allocated to remaining performance obligations if the variable consideration is allocated entirely to a wholly unsatisfied performance obligation. The Company has also applied the practical expedient in accordance with ASC 340-40, Other Assets and Deferred Costs to expense costs as incurred for costs to obtain a contract with a customer when the amortization period would have been one year or less. Transaction-Based Expenses Transaction-based expenses represent the fees incurred to support placement and custodial activities. These include expenses for fund insurance, fund management and fund settlement expenses that relates to services provided to the Funds, and external broker fees and transfer fees related to placement and custodial services provided to other brokerage and custodial customers to facilitate transactions. Share-Based Compensation Expense The Company recognizes share-based compensation expense for all share-based awards made to employees, directors and non-employees based on the grant date fair value of the awards. The fair value of an award is estimated on the date of grant using the Black-Scholes option pricing model. The fair value of an award is recognized as an expense over the requisite service period on a straight-line basis. Forfeitures are accounted for as they occur. F-39 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data The determination of the grant date fair value of share-based awards is affected by the estimated fair value of the Company s common stock as well as other highly subjective assumptions, including, but not limited to, the expected term of the share-based awards, expected equity volatility, risk-free interest rates, and expected dividends, which are estimated as follows: Fair Value of Common Stock As the Company s common stock is not publicly traded, the fair value of the common stock was determined by the Company s board of directors, after considering contemporaneous third-party valuations and input from management. The valuations of the Company s common stock were determined in accordance with the guidelines outlined in the American Institute of Certified Public Accountants Practice Aid, Valuation of Privately-Held-Company Equity Securities Issued as Compensation. In the absence of a public trading market, the Company s board of directors, with input from management, exercised significant judgment and considered numerous objective and subjective factors to determine the fair value of the Company s common stock as of the date of each option grant, including the following factors: the Company s capital resources and financial condition; the prices paid for common or convertible preferred stock sold to third-party investors by the Company and prices paid in secondary transactions in arm s length transactions; the preferences held by the Company s preferred stock classes relative to those of the Company s common stock; the likelihood and timing of achieving a liquidity event, such as an initial public offering, given prevailing market conditions; the Company s historical operating and financial performance as well as management s estimates of future financial performance; valuations of comparable companies; the relative lack of marketability of the Company s common stock; SPAC equity market conditions affecting the trading price of comparable public companies; industry information such as market growth and volume and macro-economic events; and additional objective and subjective factors relating to the business. Expected term The expected term represents the period that options are expected to be outstanding. The Company determines the expected term using the simplified method. The simplified method deems the term to be the midpoint of the time-to-vesting and the contractual life of the options. Expected volatility As a public market for the Company s common stock does not exist, there is no trading history of the common stock. The Company estimated the expected volatility based on the implied volatility of similar publicly-held entities, referred to as guideline companies, over a look-back period equivalent to the expected term of the awards. In evaluating the similarity of guideline companies, the Company considered factors such as industry, stage of life cycle, size, and financial leverage. Risk-free interest rate The risk-free interest rate used to value share-based awards is based on the U.S. Treasury yield in effect at the time of grant for a period consistent with the expected term of the award. Estimated dividend yield The expected dividend was assumed to be zero as the Company has never declared or paid any cash dividends and do not currently intend to declare dividends in the foreseeable future. For certain awards with performance-based and market-based conditions, the Company uses a Monte Carlo simulation to determine the fair value at the grant date and recognizes share-based compensation expense using accelerated attribution method when F-40 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data it becomes probable that the performance-based condition will be met. Under the Monte Carlo simulation, stock returns are simulated to estimate the payouts established by the vesting conditions of the awards and an estimated time that the awards will vest. The assumptions used in the Monte Carlo simulation include: the fair value of common stock, estimating the length of time employees will retain their stock options before the occurrence of a liquidity event ( expected term ), the estimated volatility of the Company s common stock price over the expected term ( expected volatility ), the risk-free interest rate and expected dividends. Restricted stock awards ( RSAs ) are grants of shares of our common stock that generally vest over a four-year period and in accordance with terms and conditions established by our board of directors. The fair value of RSAs is based on the value of the underlying stock less any applicable purchase price. Share-based compensation expense is recognized over the vesting term on a straight-line basis, which reflects the service period. Advertising Advertising costs are expensed as incurred and include advertising and trade shows. Advertising costs amounted to $2,896 and $274 for the years ended December 31, 2021 and 2020, respectively, and are included in advertising and market development in the consolidated statements of operations and comprehensive loss. Income Taxes The Company accounts for income taxes using the asset and liability method whereby deferred tax assets and liabilities are determined based on temporary differences between the bases used for financial reporting and income tax reporting purposes. Deferred income taxes are provided based on the enacted tax rates and laws that will be in effect at the time such temporary differences are expected to reverse. A valuation allowance is provided for deferred tax assets if it is more likely than not that the Company will not realize those tax assets through future operations. The Company utilizes a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount which is more likely than not of being realized and effectively settled. The Company considers many factors when evaluating and estimating the Company s tax positions and tax benefits, which may require periodic adjustments, and which may not accurately reflect actual outcomes. The Company recognizes interest and penalties on unrecognized tax benefits as a component of provision for income taxes in the consolidated statements of operations and comprehensive loss. Foreign Currency The functional currency of the Company is the U.S. dollars. Accordingly, foreign currency assets and liabilities are remeasured into U.S. dollars at the end-of-period exchange rates except for non-monetary assets and liabilities, which are measured at historical exchange rates. Revenue and expenses are remeasured each day at the exchange rate in effect on the day the transaction occurred. Foreign currency transaction gains and losses have been immaterial for the years ended December 31, 2021 and 2020. Comprehensive Loss Comprehensive loss consists of other comprehensive loss and net loss. The Company did not have any other comprehensive loss transactions during the periods presented. Accordingly, the comprehensive loss is equal to the net loss for the years ended December 31, 2021 and 2020. Net Loss Per Share Attributable to Common Stockholders The Company computes net loss per share using the two-class method required for participating securities. The two-class method requires income attributable to common stockholders for the period to be allocated between common stock and participating securities based upon their respective rights to receive dividends as if all income for the period had been distributed. The Company determined that it has participating securities in the form of convertible preferred stock as holders of such securities have dividend rights in the F-41 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data event of a declaration of a dividend for shares of common stock. These participating securities do not contractually require the holders of such stocks to participate in the Company s losses. As such, net loss for the period presented was not allocated to the Company s participating securities. The Company s basic net loss per share is calculated by dividing net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding for the period, without consideration of potentially dilutive securities. The diluted net loss per share is calculated by giving effect to all potentially dilutive securities outstanding for the period using the treasury share method or the if-converted method based on the nature of such securities. Diluted net loss per share is the same as basic net loss per share in periods when the effects of potentially dilutive shares are anti-dilutive. Recent Accounting Pronouncements Emerging Growth Company As an emerging growth company, the Jumpstart Our Business Startups Act ( JOBS Act ) allows the Company to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. The Company has elected to use this extended transition period under the JOBS Act. The adoption dates discussed below reflect this election. Recently Adopted Accounting Standards In August 2020, the FASB issued ASU No. 2020-06, Debt Debt with Conversion and Other Options (Subtopic 470-20) and Hedging Contracts in Entity s Own Equity (Subtopic 815-40) ( ASU 2020-06 ). ASU 2020-06 simplifies accounting for convertible instruments by removing major separation models required under current GAAP. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception and it revises the guidance in ASC 260, Earnings Per Share, to require entities to calculate diluted earnings per share for convertible instruments by using the if- converted method. ASU 2020-06 may be applied on a full retrospective or modified retrospective basis. The Company early adopted ASU 2020-06 on January 1, 2021, on a full retrospective basis, and the adoption has a material impact on its consolidated financial statements, as the Company is not required to recognize any beneficial conversion feature of its convertible notes as a result of the adoption of ASU 2020-06. ASU 2020-06 was applied in the periods presented in these consolidated financial statements. Recent Accounting Standards Issued, But Not Yet Adopted In June 2016, the FASB issued ASU 2016-13, with subsequent amendments, Financial Instruments Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ( ASU 2016-13 ). ASU 2016-13 requires immediate recognition of management s estimates of current expected credit losses. ASU 2016-13 is effective for annual reporting periods beginning after December 15, 2022, and interim periods within that fiscal year, with early adoption permitted. The Company is currently evaluating the impact of adoption on the consolidated financial statements. F-42 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data 2. Acquisitions SharesPost On November 9, 2020, the Company completed the acquisition of the broker-dealer business of SharesPost, Inc. ( SharesPost ). Upon closing of the transaction, SharesPost and several of its subsidiaries, became wholly-owned subsidiaries of the Company. The acquisition is intended to allow the combined organization to provide investors an integrated investing experience. The merger consideration comprised cash, 9,015,140 shares of the Company s Class AA common stock, 2,313,623 shares of Junior convertible preferred stock, and 1,000,000 shares Junior convertible preferred stock warrants that can be converted into shares of Junior convertible preferred stock (Note 11). In May 2020, six months prior to the merger, the Company entered into a secured promissory note agreement with SharesPost for an aggregated amount of $3,000. The secured promissory note was forgiven post-merger and included in purchase consideration. The following table presents the components of the purchase consideration to acquire SharesPost: Amount Cash $ 20,340 Secured promissory note 3,000 Fair value of Junior convertible preferred stock issued 20,383 Fair value of Class AA common stock issued 44,817 Fair value of warrants issued 1,285 Total $ 89,825 The Company recognized $3,289 of acquisition-related transaction costs in the Company s consolidated statements of operations and comprehensive loss during the year ended December 31, 2020 related to the SharesPost acquisition. The following table presents the allocation of the purchase price for SharesPost as of the acquisition date: Amount Cash $ 6,443 Accounts receivable, net 1,014 Prepaid expenses and other current assets 1,073 Property and equipment, net 590 Operating lease right-of-use assets 4,575 Identified intangible assets 13,090 Goodwill 77,126 Accounts payable (1,275) Accrued expenses and other current liabilities (5,127) Operating lease liabilities (7,684) Total $ 89,825 Goodwill is primarily attributable to expected post-acquisition synergies from integrating SharesPost s broker-dealer business and incremental revenue opportunities from SharesPost s existing programs. The goodwill recorded is not deductible for income tax purposes. The following table presents details of the identified intangible assets acquired: Amount Estimated Useful Life Developed technology $ 10,500 4 years In-process research and development asset 960 Indefinite Trade name 320 1 year Customer relationships 1,310 4 years Total $ 13,090 F-43 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data SharesPost s results of operations have been included in the Company s consolidated statements of operations and comprehensive loss from the November 9, 2020 acquisition date. The following pro forma financial information gives effect to the acquisition of SharesPost on January 1, 2020, including pro forma adjustments related to the valuation and allocation of the purchase price, primarily amortization of acquired intangible assets, incremental interest expense on debt financing obtained in connection with the acquisition, reversal of interest expense on convertible notes repaid in full by Forge in connection with the acquisition, additional share-based compensation expense related to accelerated vesting of options, and direct transaction costs reflected in the historical financial statements. The table below is presented for informational purposes only and are not intended to represent or be indicative of the results of operations that would have been reported had the acquisition occurred on January 1, 2020. These should not be taken as representative of future results of operations of the combined company: Years Ended December 31, 2020 (Unaudited) Pro forma revenue $ 75,981 Pro forma net loss $ (13,483) 3. Fair Value Measurements Financial instruments consist of cash equivalents, restricted cash, accounts receivable, accounts payable, accrued liabilities, payment-dependent notes receivable, payment-dependent notes payable, and warrant liabilities. Cash equivalents, payment-dependent notes receivable, payment-dependent notes payable, and warrant liabilities are stated at fair value on a recurring basis. Restricted cash, accounts receivable, accounts payable, and accrued liabilities are stated at their carrying value, which approximates fair value due to the short time to the expected receipt or payment date. The Company does not have short-term investments as of December 31, 2021 and 2020. The following tables present the fair value hierarchy for assets and liabilities measured at fair value on a recurring basis: As of December 31, 2021 Level 1 Level 2 Level 3 Total Cash and cash equivalents: Money market funds $ 24,240 $ $ $ 24,240 Payment-dependent notes receivable, current 1,153 1,153 Payment-dependent notes receivable, noncurrent 13,453 13,453 Total financial assets $ 25,393 $ $ 13,453 $ 38,846 Payment-dependent notes payable, current 1,153 1,153 Payment-dependent notes payable, noncurrent 13,453 13,453 Warrant liabilities 7,844 7,844 Total financial liabilities $ 1,153 $ $ 21,297 $ 22,450 As of December 31, 2020 Level 1 Level 2 Level 3 Total Cash and cash equivalents: Money market funds $ 6,050 $ $ $ 6,050 Payment-dependent notes receivable, current 1,165 38,124 39,289 Payment-dependent notes receivable, noncurrent 13,735 13,735 Total financial assets $ 7,215 $ $ 51,859 $ 59,074 Payment-dependent notes payable, current 1,165 38,124 39,289 Payment-dependent notes payable, noncurrent 13,735 13,735 Warrant liabilities 1,780 1,780 Total financial liabilities $ 1,165 $ $ 53,639 $ 54,804 F-44 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data The Company classifies money market funds and certain payment-dependent notes receivable and payment-dependent notes payable within Level 1 of the fair value hierarchy because the Company values these investments using quoted market prices. The Company classifies certain payment-dependent notes receivable and payment-dependent notes payable within Level 3 of the fair value hierarchy if the underlying securities are equity of private companies whose regular financial and nonfinancial information is generally not available other than when it is publicly disclosed, or significant unobservable inputs are used to estimate fair value. The following tables summarize the quantitative inputs and assumptions used for the Company s payment-dependent notes receivable and payment-dependent notes payable classified as Level 3 of the fair value hierarchy: As of December 31, 2021 Significant Fair Valuation Unobservable Level 3 Measurements Value Technique(s) Input(s) Range Financial assets Payment-dependent notes receivable $ 13,453 Transaction prices N/A(1) N/A Financial liabilities Payment-dependent notes payable $ 13,453 Transaction prices N/A(1) N/A As of December 31, 2020 Significant Fair Valuation Unobservable Level 3 Measurements Value Technique(s) Input(s) Range Financial assets Payment-dependent notes receivable $ 13,735 Transaction prices N/A(1) N/A $ 38,124 Discounted transaction prices(2) Discount for lack of marketability 5 % Financial liabilities Payment-dependent notes payable $ 13,735 Transaction prices N/A(1) N/A $ 38,124 Discounted transaction prices(2) Discount for lack of marketability 5 % (1) The Company considers completed transactions made through the Company s platform for the relevant private securities as relevant data inputs. (2) The Company uses publicly traded share prices at the close of the valuation date as the primary factor in the fair value analysis and applies a discount to the share prices to reflect lack of marketability. The Company used a hybrid method that incorporates the Black-Scholes option-pricing model and an adjusted backsolve model to estimate the fair value of the warrant liabilities. This approach is a scenario- based analysis that considers many assumptions, including the likelihood of potential liquidity events, the nature and timing of such potential events, actions taken with regard to the warrants at expiration, as well as discounts for lack of marketability of the underlying securities and warrants. The Company estimated the fair value of the warrants liability as of December 31, 2021 and 2020, respectively, using the following key assumptions: As of December 31, 2021 2020 Fair value of underlying securities $30.8 $12.4 Discounts for lack of marketability 0.0% 29.0% 34.0% Expected term (years) 3.4 8.8 4.4 9.8 Expected volatility 40.4% 44.3% 39.9% 41.8% Risk-free interest rate 1.0% 1.5% 0.3% 0.9% Expected dividend yield 0.0% 0.0% Fair value per warrant $5.0 $22.0 $1.5 $1.9 F-45 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data The Company transfers financial instruments out of Level 3 on the date when underlying input parameters are readily observable from existing market quotes. Transfers from Level 3 to Level 1 generally relate to an investee company going public and listing on a national securities exchange. During the years ended December 31, 2021 and 2020, there were transfers of securities segregated for customers from Level 3 to Level 1, as one private company was acquired by a public company and became publicly-traded under the acquiror, and the Company was able to obtain independent market-quoted prices for the acquiror company. The following table provides reconciliation for all financial assets measured at fair value using significant unobservable inputs (Level 3) for years ended December 31, 2021 and 2020: Balance as of December 31, 2019 $ 25,892 Change in fair value of short-term investments 11 Distribution of short-term investments (136) Change in fair value of payment-dependent notes receivable. 27,319 Payment-dependent notes receivable transferred out of Level 3 to Level 1 (1,165) Settlement of payment-dependent notes receivable (62) Balance as of December 31, 2020 $ 51,859 Change in fair value of payment-dependent notes receivable 29,364 Payment-dependent notes receivable transferred out of Level 3 to Level 1 (62,637) Settlement of payment-dependent notes receivable (5,133) Balance as of December 31, 2021 $ 13,453 The following table provides reconciliation for payment-dependent notes payable measured at fair value using significant unobservable inputs (Level 3) for years ended December 31, 2021 and 2020: Balance as of December 31, 2019 $ 25,767 Change in fair value of payment-dependent notes payable 27,319 Payment-dependent notes payable transferred out of Level 3 to Level 1 (1,165) Settlement of payment-dependent notes payable (62) Balance as of December 31, 2020 $ 51,859 Change in fair value of payment-dependent notes payable 29,364 Payment-dependent notes payable transferred out of Level 3 to Level 1 (62,637) Settlement of payment-dependent notes payable (5,133) Balance as of December 31, 2021 $ 13,453 The following table provides reconciliation for warrant liabilities measured at fair value using significant unobservable inputs (Level 3) for years ended December 31, 2021 and 2020: Balance as of December 31, 2019 $ Fair value of warrant at issuance 1,488 Change in fair value of warrant liabilities 292 Balance as of December 31, 2020 $ 1,780 Change in fair value of warrant liabilities 6,064 Balance as of December 31, 2021 $ 7,844 F-46 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data 4. Consolidated Balance Sheet Components Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted of the following: As of December 31, 2021 2020 Prepaid expenses $ 3,162 $ 2,707 Loans receivable from equity method investment, current 62 Other current assets 1,986 1,377 Prepaid expenses and other current assets $ 5,148 $ 4,146 Property and Equipment, Net Property and equipment, net consisted of the following: As of December 31, 2021 2020 Computer equipment $ 336 $ 336 Furniture and fixtures 621 621 Leasehold improvements 320 320 Total property and equipment $ 1,277 $ 1,277 Less: Accumulated depreciation (780) (380) Property and equipment, net $ 497 $ 897 For the years ended December 31, 2021 and December 31, 2020, the Company recorded depreciation expense related to property and equipment amounting to $400 and $198, respectively. Internal-Use Software, Net Capitalized internal-use software consists of the following: As of December 31, 2021 2020 Capitalized internal-use software $ 2,860 $ 1,592 Less: Accumulated amortization (169) (17) Total capitalized internal-use software $ 2,691 $ 1,575 For the years ended December 31, 2021 and December 31, 2020, the Company recorded amortization expense on capitalized internal-use software placed in service amounting to $152 and $17, respectively. F-47 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following: As of December 31, 2021 2020 Accrued professional services $ 1,798 $ 656 Accrued payments related to acquisitions and financing 1,134 3,565 Accrued taxes and deferred tax liabilities 1,421 283 Early exercise liability 786 36 Other current liabilities 3,204 2,748 Total $ 8,343 $ 7,288 5. Goodwill and Intangible Assets, Net During the year of 2021, the Company purchased a domain name for $2,202. The purchase of the domain name created an intangible asset with an indefinite life that is not being amortized for book purposes. There were no changes in the recorded balance of goodwill during the year ended December 31, 2021. In- process research and development assets were acquired in business combinations, and launched in September 2021. The Company started to amortize the assets in September 2021using the straight-line method over the estimated useful lives determined as 5 years. The components of intangible assets and accumulated amortization are as follows: The components of intangible assets and accumulated amortization are as follows: As of December 31, 2021 Weight Average Gross Net Remaining Carrying Accumulated Carrying Amortization Period Amount Amortization Amount Finite-lived intangible assets: Developed technology 3.0 years $ 13,200 $ (5,250) $ 7,950 Customer relationships 7.0 years 7,410 (1,696) 5,714 Trade name 0.0 years 320 (320) Launched IPR&D assets. 5.0 years 960 960 Total finite-lived intangible assets 21,890 (7,266) 14,624 Indefinite-lived intangible assets: Trade name website domain (forge.com) Indefinite 2,202 2,202 Total infinite-lived intangible assets 2,202 2,202 Total intangible assets $ 24,092 $ (7,266) $ 16,826 F-48 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data As of December 31, 2020 Weight Average Gross Net Remaining Carrying Accumulated Carrying Amortization Period Amount Amortization Amount Finite-lived intangible assets: Developed technology 3.6 years $ 13,200 $ (1,673) $ 11,527 Customer relationships 7.9 years 7,410 (759) 6,651 Trade name 0.9 years 320 (46) 274 Total finite-lived intangible assets 20,930 (2,478) 18,452 Indefinite-lived intangible assets: In-process research and development asset Indefinite 960 960 Total infinite-lived intangible assets 960 960 Total finite-lived intangible assets $ 21,890 $ (2,478) $ 19,412 Amortization expense related to finite-lived intangible assets for the years ended December 31, 2021 and 2020 was $4,788 and $2,191, respectively, and was included in depreciation and amortization in the accompanying consolidated statements of operations and comprehensive loss. The table below presents estimated future amortization expense for definite-lived intangible assets as of December 31, 2021: Amount 2022 $ 3,915 2023 3,915 2024 3,462 2025 802 2026 802 Thereafter 1,728 Total $ 14,624 6. Debt 2019 Convertible Notes In October 2019, the Company issued convertible notes to investors, which matured in January 2021. At maturity, the note holders had the option to convert the outstanding principal and unpaid accrued interest into shares of the Company s Series B-1 convertible preferred stock at a conversion price of $12.4168. As of December 31, 2020, the Company had $2,500 outstanding under the 2019 Convertible Notes. In January 2021, one investor converted its convertible note amount of $111 into 8,949 shares of Series B-1 convertible preferred stock; the remaining outstanding convertible notes were fully repaid. 2020 Convertible Notes In May 2020, the Company entered into a Note and Warrant Purchase Agreement with investors ( 2020 Convertible Notes ). A portion of $8,960 of the notes were converted to Series B-1 convertible preferred stock in November 2020, and the remaining $1,750 principal outstanding as of December 31, 2020 was fully repaid in May 2021. 2020 Loan and Security Agreement In October 2020, the Company entered into a Loan and Security Agreement ( 2020 Loan and Security Agreement, or 2020 Term Loan ) with another lending institution that provided for a term loan in the amount of $15,000. As of December 31, 2020, the Company had $15,000 outstanding under the term loan. The Company fully repaid the term loan in April 2021. The Company did not have any outstanding debt as of December 31, 2021. F-49 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data 7. Leases The Company leases real estate for office space under operating leases. In June 2021, The Company entered into a sublease agreement related to one of the Company s leases and the Company recorded rent expense on a straight-line basis for the lease, net of sublease income, in rent and occupancy in the consolidated statements of operations and comprehensive loss. In December 2021, the Company commenced on a new lease for additional office space and recorded rent expense on a straight-line basis. As of December 31, 2021, the remaining lease terms varied from 1.0 years to 3.6 years. For certain leases the Company has an option to extend the lease term for a period of 5 years. This renewal option is not considered in the remaining lease term unless it is reasonably certain that the Company will exercise such options. Operating lease expense, included in rent and occupancy on the consolidated statements of operations and comprehensive loss, for the years ended December 31, 2021 and 2020 was $3,337 and $2,215, respectively. Operating lease expenses exclude short-term lease costs and variable lease costs, each of which was immaterial for the years ended December 31, 2021 and 2020. Lease expenses for the years ended December 31, 2021 and 2020 include an offset for sublease income of $175 and 0, respectively, and included in rent and occupancy in the consolidated statements of operations and comprehensive loss. The table below presents additional information related to the Company s operating leases: As of December 31, 2021 2020 Operating lease right-of-use assets $ 7,881 $ 8,983 Operating lease liabilities, current $ 5,367 $ 3,536 Operating lease liabilities, noncurrent $ 5,159 $ 8,824 Weighted-average remaining lease term (in years) 2.0 3.4 Weighted-average discount rate 4.9 % 5.0 % Future undiscounted lease payments under operating leases as of December 31, 2021 were as follows: Lease Payment Sublease Net Lease Obligation Income Obligation 2022 5,762 (349) 5,413 2023 4,030 (349) 3,681 2024 936 (349) 587 2025 393 (204) 189 2026 Total undiscounted lease payments $ 11,121 $ (1,251) $ 9,870 Less: Imputed interest 595 Present value of future lease payments $ 10,526 Less: operating lease liabilities, current 5,367 Operating lease liabilities, noncurrent $ 5,159 As of December 31, 2021, the Company did not have any additional significant lease contracts that had not yet commenced. 8. Commitments and Contingencies The Company is subject to claims and lawsuits in the ordinary course of business, including arbitration, class actions and other litigation, some of which include claims for substantial or unspecified damages. The Company is also the subject of inquiries, investigations, and proceedings by regulatory and other governmental agencies. The Company reviews its lawsuits, regulatory inquiries and other legal proceedings on an ongoing basis and provide disclosures and record loss contingencies in accordance with the loss contingencies accounting guidance. The Company establishes an accrual for losses at management s best estimate when the F-50 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data Company assesses that it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. If no amount within the range is considered a better estimate than any other amount, an accrual for losses is recorded based on the bottom amount of the range. Accrual for loss contingencies are recorded in accounts payable and accrued expenses and other current liabilities on the consolidated balance sheets and expensed in general and administrative expenses in our consolidated statements of operations and comprehensive loss. The Company monitors these matters for developments that would affect the likelihood of a loss and the accrued amount, if any, and adjusts the amount as appropriate. Legal Proceeding On January 7, 2022, the Shareholder Representative of SharesPost (the Plaintiff ) filed a lawsuit against the Company in the Court of Chancery of the State of Delaware. The complaint alleged that the Company breached the SharesPost Merger Agreement (the Agreement ) by failure to issue and deliver the warrants in a form claimed by the Plaintiff, but which was not reflected in the Agreement. The complaint seeks, among other things, a declaratory judgement establishing alleged breaches, a compulsion of issuance and delivery of warrants in the form, and an indemnification of losses as a result of the alleged breaches. On February 24, 2022, the Company filed their response to the complaint. The Company believes this complaint is without merit and intends to defend it vigorously. The Company is unable to predict the outcome, nor the amount of time and expense that will be required to resolve the complaint. No provision for a loss contingency has been recorded as the amount of losses, if any, is not estimable as of December 31, 2021. 401(k) Plan The Company has established a tax-qualified retirement plan under Section 401(k) of the Internal Revenue Code for all of its U.S. employees, including executive officers, who satisfy certain eligibility requirements, including requirements relating to age and length of service. The Company matches 2% of every dollar contributed to the plan by employees, including executive officers, up to a maximum of $5.8. During the years ended December 31, 2021 and 2020, the Company contributed $456 and $67, respectively, to the defined contribution plan, respectively. Non-Cancelable Purchase Obligations In the normal course of business, the Company enters into non-cancelable purchase commitments with various parties mainly for liability insurance and software products and services. As of December 31, 2021, the Company had outstanding non-cancelable purchase obligations with a term of 12 months or longer as follows: Amount 2022 $ 1,451 2023 1,202 2024 1,414 2025 1,676 2026 1,976 Total $ 7,719 9. Off Balance Sheet Items The Company organizes a series of investment funds, each of which is represented by a limited liability company ( LLC ) within Forge Investments LLC and by portfolio companies within Forge Investments SPC and Forge Investments II SPC. The funds were formed for the purpose of investing in securities relating to a single private company. Each series of funds consists of a separate and distinct portfolio of investments owned by different investors. The Company utilizes third-party fund administrators to manage the funds and has no ownership interest nor participation in the gains or losses of the entities represented by the funds. The Company paid for the expenses incurred by these entities, including fund insurance expenses of $274 and $1,121, and fund management expenses of $371 and $264 for the years ended December 31, 2021 and 2020, respectively, included in transaction-based expenses on consolidated statements of operations and comprehensive loss. Also, the Company paid fund audit fees of $797 and $435 during the years ended December 31, 2021 and 2020, respectively, included in professional services on consolidated statements of operations and F-51 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data comprehensive loss. The Company did not consolidate Forge Investments LLC and Forge Investment SPC, or the investment funds, because the Company has no direct or indirect interest in Forge Investments LLC and Forge Investment SPC, or the investment funds, and the expenses that the Company pays on behalf of Forge Investments LLC and Forge Investment SPC, or the investment funds, are not significant to those entities. The Company believes its maximum exposure to loss resulting from its involvement with those entities is limited to the payment of future insurance expenses, management expenses and audit fees. 10.Capitalization Convertible Preferred Stock In 2020, the Company issued an additional 3,562,869 shares of Series B-1 convertible preferred stock at a purchase price of $12.4168 per share, for an aggregate purchase price of $44,239. Issuance costs were $2,713. In November 2020, certain holders of the 2019 and 2020 convertible notes exercised their option and converted the notes into 1,143,624 shares of the Company s Series B-1 Preferred stock at a conversion price of $8.69176 per share, which was equal to 70% of the original issuance price of the Series B-1 convertible preferred stock. In November 2020, in connection with SharesPost acquisition, the Company issued 2,313,623 shares of Junior convertible preferred stock at a fair value of $12.4168 per share. In January 2021, the Company issued 8,949 shares of Series B-1 convertible preferred stock upon the conversion of 2020 convertible notes (Note 6). Principal plus accrued interest on the convertible notes of $111 were converted to convertible preferred stock at a price of $12.4168 per share. In April 2021, the Company issued 4,072,904 shares of Series B-1 convertible preferred stock at a purchase price of $12.4168 per share, for an aggregate purchase price of $50,573. Issuance costs were $2,838. In April 2021, the Company amended and restated its certificate of incorporation to authorize 805,360 shares of Series B-2 convertible preferred stock. The Series B-2 convertible preferred stock has the same dividend, liquidation, and conversion rights as the Company s Series B-1 convertible preferred stock. Holders of the Company s Series B-2 convertible preferred stock are not entitled to voting rights. The Company issued 132,127 shares of Series B-2 convertible preferred stock at a purchase price of $12.4168 per share, for an aggregate purchase price of $1,640. Issuance costs were immaterial. In April 2021, the Company amended and restated its certificate of incorporation to, redefine the mandatory conversion triggering event of convertible preferred stock to include qualified initial public offering, or qualified special purpose acquisition company ( SPAC ) transaction. As of December 31, 2021, the trigger event of convertible preferred stock had not occurred and therefore, there is no impact to these consolidated financial statements. The following table summarizes the original issuance price per share and authorized and outstanding number of shares of convertible preferred stock as of the dates indicated: As of December 31, 2021 Original Number of Number of Carrying Aggregate Issuance Shares Shares Value Net of Liquidation Series Name Price Authorized Outstanding Issuance Costs Preference Series AA $ 3.0817 1,114,988 1,114,988 $ 3,435 $ 3,435 Series B $ 10.6592 6,615,809 6,615,809 70,045 70,519 Series B-1 $ 12.4168 15,949,487 13,491,651 150,553 167,523 Series B-2 $ 12.4168 805,360 132,127 1,640 1,640 Junior $ 12.4168 3,313,623 2,313,623 20,383 28,728 Total 27,799,267 23,668,198 $ 246,056 $ 271,845 F-52 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data As of December 31, 2020 Original Number of Number of Carrying Aggregate Issuance Shares Shares Value Net of Liquidation Series Name Price Authorized Outstanding Issuance Costs Preference Series AA $ 3.0817 1,114,988 1,114,988 $ 3,435 $ 3,435 Series B $ 10.6592 6,615,809 6,615,809 70,045 70,519 Series B-1 $ 12.4168 10,435,129 5,672,925 62,985 70,440 Junior $ 12.4168 4,354,089 2,313,623 20,383 28,728 Total 22,520,015 15,717,345 $ 156,848 $ 173,122 Redemption Rights The holders of convertible preferred stock have no voluntary rights to redeem shares. The convertible preferred stock has deemed liquidation provisions which require the shares to be redeemed upon any liquidation, dissolution, or winding up of the Company, whether voluntary or involuntary, or a deemed liquidation event, defined as a merger or consolidation in which the Company is a constituent party or a subsidiary of the Company is a constituent party and the Company issues shares of its capital stock pursuant to such merger or liquidation event. Although the redeemable convertible preferred stock is not mandatorily or currently redeemable, a deemed liquidation event, defined as a merger or consolidation in which the Company is a constituent party or a subsidiary of the Company is a constituent party and the Company issues shares of its capital stock pursuant to such merger or liquidation event, could constitute a redemption event outside the Company s control. Therefore, all shares of redeemable convertible preferred stock have been presented outside of permanent equity. The Company recorded all shares of convertible preferred stock at their respective issuance price less issuance costs on the dates of issuance. Given the Company s performance and financial condition, the Company currently does not believe a deemed liquidation event is probable. The carrying values of the Company s convertible preferred stock have not been accreted to their redemption values as the deemed liquidation event is not considered probable of occurring. Subsequent adjustments of the carrying values to redemption values will be made only if and when it becomes probable the preferred stock will become redeemable. Liquidation Preference In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, or a deemed liquidation event, defined as a merger or consolidation in which the Company is a constituent party or a subsidiary of the Company is a constituent party and the Company issues shares of its capital stock pursuant to such merger or liquidation event, Series AA, Series B, Series B-1 and Series B-2 convertible preferred stock shall be entitled to receive a payout of $3.0817, $10.6592, $12.4168 and $12.4168 per share, respectively, plus any declared and unpaid dividends, prior and in preference to any distributions made to the holders of Junior convertible preferred stock and to the holders of common stock. If the assets and funds distributed among the holders of Series AA, Series B, Series B-1 and Series B-2 convertible preferred stock are insufficient to permit payment to such holders of the full preferential amount, then the entire assets and funds of the Company legally available for distribution shall be distributed ratably among the holders of Series AA, Series B, Series B-1 and Series B-2 convertible preferred stock in proportion to the preferential amount each such holder is otherwise entitled to receive. After the payment of the full liquidation preference of Series AA, Series B, Series B-1 and Series B-2 convertible preferred stock, the holders of Junior convertible preferred stock are entitled to receive an amount equal to $12.4168 per share, plus any declared but unpaid dividends, prior and in preference to any distributions made to the holders of common stock. If the remaining assets and funds distributed among the holders of the Junior convertible preferred stock are insufficient to permit payment to such holders of the full preferential amount, then all assets and funds of the Company legally available for distribution shall be distributed ratably among the holders of Junior convertible preferred stock in proportion to the preferential amount each such holder is otherwise entitled to receive. After the payment of the full liquidation preference of the shares of redeemable convertible preferred stock, the remaining assets of the Company legally available for distribution, if any, shall be distributed ratably to the holders of the common stock. F-53 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data Dividends Holders of Series B, Series B-1 and Series B-2 convertible preferred stock, prior and in preference to the holders of Junior convertible preferred stock, are entitled to receive cash dividends at a rate of 6.0% of their original issuance price. Dividends are payable only when, as and if declared by the Company s board of directors. The Company shall not declare, pay or set aside any dividends on shares of any other class or series of capital stock unless the holders of the convertible preferred stocks receive a dividend on each outstanding share of convertible preferred stock. Holders of Series AA convertible preferred stock are entitled to receive the same dividend should holders of Series B, Series B-1 or Series B-2 convertible preferred stock receive a dividend. Dividends are cumulative. No dividends have been declared to date. Conversion Each share of convertible preferred stock shall be convertible, at the option of the holder and without the payment of additional consideration by the holder, into such number of fully paid and non-assessable shares of Class AA Common Stock as is determined by dividing the original issuance price by the Series in effect at the time of conversion. Voting Rights Holders of convertible preferred stock are entitled to one vote for each share of common stock into which their shares can be converted. Holders of Series B convertible preferred stock together are entitled to appoint one member of the board of directors. Holders of Series B-1 convertible preferred stock together are entitled to appoint one member of the board of directors. Holders of the Company s Series B-2 convertible preferred stock are not entitled to voting rights. Holders of Junior convertible preferred stock together are entitled to appoint two members of the board of directors. The holders of common stock and convertible preferred stock shall vote together as a single class on an as-if-converted basis and shall elect any remaining members of the board of directors. As of December 31, 2021, one member of the board of directors was elected by holders of Series B convertible preferred stock, four members of the board of directors were elected by holders of Series B-1 convertible preferred stock, and two members of the board of directors were elected by holders of Junior convertible preferred stock. As of December 31, 2020, one member of the board of directors was elected by holders of Series B convertible preferred stock, one member of the board of directors was elected by holders of Series B-1 convertible preferred stock, and two members of the board of directors were elected by holders of Junior convertible preferred stock. Common Stock The Company has authorized four classes of common stock: Class AA common stock, Class AA-1 common stock, Class EE-1 common stock and Class EE-2 common stock (collectively, the common stock ). Holders of common stock are entitled to receive any dividends if and when such dividends are declared by the board of directors. Common stock is subordinated to the convertible preferred stock with respect to dividend rights and rights upon certain deemed liquidation events. Common stock is not redeemable at the option of the holder or by the Company. As of December 31, 2021 and 2020, the Company was authorized to issue up to 82,604,627 and 76,182,515 shares of its capital stock, of which 54,805,360 and 53,662,500 shares have been designated as common stock, respectively. The holders of the Class EE-1 common stock and Class AA common stock are entitled to one vote for each share and the holders of Class EE-2 common stock are entitled to (a) with respect to votes of one or more classes of common stock only, twenty votes for each share of Class EE-2 common stock and (b) with respect to Class EE-2 common stock voting together with any shares of Preferred Stock, one vote for each share of Class EE-2 common stock. Holders of common stock, voting together as a separate class, are entitled to appoint four members of the board of directors, who will be deemed common directors. As of December 31, 2021 and 2020, two members of the board of directors were elected by holders of common stock. Each share of Class AA common stock shall be convertible to one share of Class EE-1 common stock, up to a cumulative maximum of 600,000 shares of Class AA common stock, and each share of Class EE-1 common stock may be converted to one share of preferred stock upon authorization by the Company s board of directors. In addition, each share of Class EE-1 or Class EE-2 may be converted, upon a disposition, to one share of Class AA common stock at the election of the holder. F-54 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data In April 2021, the Company amended and restated its certificate of incorporation to, (i) increased the number of authorized shares of all classes of stock (including preferred stock) to 82,604,627 (ii) reclassified each share of Class EE-1 common stock and Class EE-2 common stock to one share of Class AA common stock. The Company has the following shares of common stock reserved for future issuance, on an as-if converted basis: As of December 31, 2021 2020 Conversion of convertible preferred stock 27,799,267 22,520,015 Warrants to purchase convertible preferred stock 1,133,725 1,133,725 Warrants to purchase common stock 74,895 74,895 Shares available for grant under 2018 Plan 363,095 1,861,856 Stock options issued and outstanding under 2018 Plan 5,031,310 3,209,063 Total shares of common stock reserved 34,402,292 28,799,554 11.Warrants Warrants to Purchase Series B-1 Preferred Stock or Subsequent Round Stock In May 2020, in connection with the issuance of 2020 Convertible Notes, the note holders entered into a Note and Warrant Purchase Agreement for the options to purchase shares based on coverage of 5% of the 2020 Convertible Notes principal amounts ( May 2020 Warrants ). The note holders can purchase either (i) the Series B-1 preferred stock of the Company at Series B-1 price of $12.4168 or (ii) any subsequent round stock of Company at the subsequent round price. The warrants have a five-year contractual life and may be exercised at any time during that period. In October 2020, simultaneously with the 2020 Loan and Security Agreement, the lenders entered into a Warrant to Purchase Shares of Preferred Stock Agreement with the Company for the options to purchase a coverage amount of $1,125 of shares ( October 2020 Warrants ). The investors can purchase either the Series B-1 convertible preferred stock of the Company at Series B-1 price of $12.4168 or (ii) any subsequent round stock of Company at the subsequent round price. The warrants have a ten-year contractual life and may be exercised at any time during that period. The May 2020 Warrants and October 2020 Warrants are classified as liabilities in the consolidated balance sheets. The Company remeasures the May 2020 Warrants and October 2020 Warrants at each balance sheet date using a hybrid method (Note 3). The Company recorded changes in fair value of the May 2020 Warrants and October 2020 Warrants of $2,592 and $48 in change in fair value of warrant liabilities in the Company s consolidated statements of operations and comprehensive loss during the years ended December 31, 2021 and 2020, respectively. Warrants to Purchase Junior Preferred Stock In November 2020, in connection with SharesPost acquisition, the Company issued a total of 1,000,000 warrants ( Junior Preferred Warrants ) to purchase shares of the Company s Junior Preferred Stock at an exercise price of $12.4168 per share. The Junior Preferred Warrants have a five-year contractual life and may be exercised at any time during that period. In the event of the Company s initial public offering ( IPO ), The Junior Preferred Warrants could settle in a variable number of shares up to a fixed monetary amount of $5 million prior to the IPO. The warrants are classified as a liability in the consolidated balance sheets. The Company remeasures the warrants at each balance sheet date using a hybrid method (Note 3). The Company recorded changes in fair value of the Junior Preferred Warrants of $3,472 and $244 change in fair value of warrant liabilities in the Company s consolidated statements of operations and comprehensive loss during the years ended December 31, 2021 and 2020, respectively. F-55 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data 12.Share-Based Compensation 2018 Equity Incentive Plan In March 2018, the Company adopted its 2018 Equity Incentive Plan, as amended from time to time, ( Amended 2018 Equity Incentive Plan or 2018 Plan ), which provides for grants of share-based awards, including stock options and restricted stock units ( RSUs ), and other forms of share-based awards. The awards may be granted by the Company s board of directors to employees, independent contractors, and consultants who provide services to the Company. As of December 31, 2021, and 2020, there were 8,209,568 and 6,672,721 shares of common stock authorized for issuance under the 2018 Plan, respectively, which includes shares already issued under such plan and shares reserved for issuance pursuant to outstanding stock options, and other forms of share-based compensation. The total number of shares that remained available for grant under the 2018 Plan as of December 31, 2021 and 2020 was 363,095 and 1,861,856, respectively. Stock options Stock options generally vest over four years and expire ten years from the date of grant. Vested stock options generally expire three months after termination of employment. Stock option activity during the years ended December 31, 2021 and 2020 consisted of the following: Weighted- Aggregate Weighted-average averages Intrinsic Stock Options Exercise Price Life (Years) Value Balance as of December 31, 2019 1,081,579 $ 2.31 8.9 $ 2,817 Granted 3,251,443 $ 2.60 Exercised (307,778) $ 1.56 Cancelled/Forfeited/Expired (816,181) $ 2.03 Balance as of December 31, 2020 3,209,063 $ 1.57 9.1 $ 16,094 Granted 3,457,020 $ 9.37 Exercised (1,247,236) $ 1.68 Cancelled/Forfeited/Expired (387,537) $ 2.00 Balance as of December 31, 2021 5,031,310 $ 6.85 9.2 $ 120,491 Vested and exercisable as of December 31, 2021 1,284,624 $ 2.33 8.3 $ 36,579 The weighted-average grant date fair value of stock options granted during the years ended December 31, 2021 and 2020 were $9.05 and $2.54 per share, respectively. The intrinsic value of stock options exercised during the years ended December 31, 2021 and 2020 was $14,161 and $1,030, respectively. The total grant date fair value of stock options vested during the years ended December 31, 2021 and 2020 were $4,034 and $3,701, respectively. The Company recorded share-based compensation of $6,433 and $3,558 for the years ended December 31, 2021 and 2020, respectively, related to stock options. Future share-based compensation for unvested stock options granted and outstanding as of December 31, 2021, is $19,628, which is to be recognized over a weighted-average period of 2.75 years. F-56 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data The Black-Scholes assumptions used to value the employee options at the grant dates are as follows: 2021 2020 Fair value of common stock $8.80 $21.29 $3.41 $6.59 Expected term (years) 5.1 7.0 5.0 6.2 Expected volatility 40.0% 41.4% 37.0% 41.7% Risk-free interest rate 0.7% 1.3% 0.3% 0.8% Expected dividend yield 0.0% 0.0% Performance and Market Condition Options In May 2021, the Company s board of directors granted the Chief Executive Officer ( CEO ) a performance and market condition-based options covering 1,000,000 shares of the Company s Class AA common stock with an exercise price of $12.4168 per share. The awards vest only upon the satisfaction of (1) certain performance conditions, which is the occurrence of an IPO, SPAC merger, or a secondary sale for total proceeds of at least $250,000 and (2) market condition, which is holders of the Company s Series B-1 Preferred Stock have realized (i) aggregate exit proceeds with fair market value of at least 31.0420, 46.5630, and 62.0840 per share; and (ii) an aggregate interest rate compounded annually which, when used as the discount rate to calculate the net present value, with respect to the occurrence of an IPO, SPAC merger or acquisition, that is equal to or greater than 20.0%, 30.0% and 35.0%. As of December 31, 2021, the performance and market condition is not probable of achieving and the Company has not yet recognized any compensation expense. The Company uses a Monte Carlo simulation model to determine the fair value of the options with performance and market-based vesting conditions for purposes of calculating share-based compensation expense if vesting conditions met. The Monte Carlo simulation model incorporates the probability of satisfying performance and market conditions and uses transaction details such as stock price, contractual terms, maturity and risk-free interest rates, as well as volatility. The fair value of the options with no performance or market vesting conditions is based on the market value of common stock on the date of grant. The fair value of the performance-based stock options was $7.10 per option share estimated using the Monte Carlo simulation methodology. The unrecognized compensation expense was $7,100 as of December 31, 2021. Early Exercised Options Under the Plan, certain stock option holders may have the right to exercise unvested options, subject to a repurchase right held by the Company at the original exercise price, in the event of voluntary or involuntary termination of employment of the option holders, until the options are fully vested. As of December 31, 2021 and 2020, the cash proceeds received for unvested shares of common stock recorded within accrued expenses and other current liabilities in the consolidated balance sheets were $785 and $36 as of December 31, 2021 and 2020, respectively, which will be transferred to additional paid-in capital upon vesting. The following table summarizes activity relating to early exercises of stock options: Number of Carrying Shares Value Unvested as of December 31, 2019 86,032 $ 115 Exercised 1,375 $ 2 Repurchased (42,073) $ (49) Vested (24,394) $ (32) Unvested as of December 31, 2020 20,940 $ 36 Exercised 463,816 $ 917 Repurchased (13,876) $ (23) Vested (88,841) $ (145) Unvested as of December 31, 2021 382,039 $ 785 F-57 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data Nonrecourse Promissory Notes to Early Exercise Stock Options In the years ended December 31, 2021 and 2020, certain employees, including certain executive officers of the company, early exercised stock options in exchange for promissory notes. These promissory notes have not been repaid as of December 31, 2021. The Company has accounted for the promissory notes as nonrecourse in their entirety since the promissory notes are not aligned with a corresponding percentage of the underlying shares. Such arrangements were accounted for as modifications to the original stock options to which they relate, as the maturity date of the promissory notes reflects the legal term of the stock option for purposes of valuing the award. Secondary Sales of Common Stock During 2021 and 2020, certain economic interest holders acquired outstanding Class AA common stock from certain founders, current or former employees, and an investor, for a purchase price greater than the Company s Class AA common stock estimated fair value at the time of the transactions. As a result, the Company recorded share-based compensation expense for the difference between the price paid and the estimated fair value on the date of the transaction of $4,311 and $119 during the years ended December 31, 2021 and 2020, respectively. In connection with these stock transfers, the Company waived all transfer restrictions and assigned its rights of first refusal applicable to such shares. Options Granted to Directors In July 2021, the Company s board of directors granted options to certain members of the Company s board of directors in connection with their services, to purchase 160,000 shares of the Company s Class AA common stock at exercise price of $16.97. Subject to the option agreement, the options shall vest in full and become exercisable as of immediately prior to the consummation of a deemed liquidation event or SPAC transaction. The performance-based vesting condition for the options granted to certain board members remains unsatisfied as of December 31, 2021 and no share-based compensation expense was recognized as the likelihood of a deemed liquidation event or SPAC transaction was not probable. If the deemed liquidation event or SPAC transaction had occurred on December 31, 2021, the Company would have recorded $1,233 of share-based compensation expense related to the options granted to certain board members. The fair value has been estimated using the Black-Scholes pricing model with the following assumptions: Fair value of common stock $ 19.07 Expected term (years) 5.3 Expected volatility 40.0 % Risk-free interest rate. 0.7 % Expected dividend yield 0.0 % Restricted Stock Awards ( RSAs ) The Company issues RSAs to employees that generally vest over a four-year period. Any unvested shares will be forfeited upon termination of services. The fair value of RSAs is based on the value of the underlying stock less any applicable purchase price. RSA expense is amortized straight-line over the requisite service period. F-58 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data The following table summarizes activity related to RSA awards: Weighted- average Number of Grant Date Shares Fair Value Unvested balance as of December 31, 2019. 1,940,130 $ 1.21 Granted $ Vested (541,704) $ 1.69 Cancelled/Forfeited $ Unvested balance as of December 31, 2020. 1,398,426 $ 1.02 Granted $ Vested (500,000) $ 1.78 Cancelled/Forfeited $ Unvested balance as of December 31, 2021 898,426 $ 0.60 The Company recorded share-based compensation expense of $890 and $915 for the years ended December 31, 2021 and 2020, respectively, related to RSAs. As of December 31, 2021, the total unrecognized expense related to all RSAs was $371, which the Company expects to recognize over a weighted-average period of 0.41 years. 13.Income Taxes The components of the loss before income taxes were as follows: Year Ended December 31, 2021 2020 Domestic $ (16,496) $ (9,554) Foreign (1,617) (961) Loss before provision for income taxes $ (18,113) $ (10,515) The components of the provision for income taxes are as follows: Year Ended December 31, 2021 2020 Current expense (benefit): Federal $ $ (818) State 50 15 Foreign Total current expense (benefit) $ 50 $ (803) Deferred expense (benefit): Federal $ 264 $ State 72 Foreign Total deferred expense (benefit) $ 336 $ Total provision for (benefit from) income taxes $ 386 $ (803) F-59 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data A reconciliation between the Company s effective tax rate and the applicable U.S. federal statutory income tax rate is summarized as follows: Year Ended December 31, 2021 2020 Tax provision (benefit) at U.S. statutory rate (3,804) 21.0 % (2,209) 21.0 % State income taxes (409) 2.3 % (127) 1.2 % Foreign taxes in excess of the U.S. statutory rate 74 (0.4) % 202 (1.9) % Change of valuation allowance 2,397 (13.2) % 525 (5.0) % Change in fair value of warrant liabilities. 1,275 (7.1) % Share-based compensation 1,548 (8.6) % 779 (7.4) % Attribute carryback (203) 1.9 % Tax credits (862) 4.8 % Other 167 (0.9) % 230 (2.2) % Tax expense (benefit) 386 (2.1) % (803) 7.6 % Significant components of the Company s net deferred tax assets are as follows: As of December 31, 2021 2020 Deferred tax assets Accrued compensation $ 3,074 $ 1,772 Operating lease liability 2,829 3,173 Share-based compensation 804 317 Net operating loss carryforwards 11,187 11,040 Allowance for bad debt 413 395 Interest expense limitation 19 375 Tax credits 862 Other 62 145 Total deferred tax assets. $ 19,250 $ 17,217 Deferred tax liabilities Depreciation and amortization $ (3,089) $ (2,718) Operating lease assets (2,148) (2,306) Total deferred tax assets (liabilities) $ 14,013 $ 12,193 Valuation allowance (14,436) (12,278) Net deferred tax assets (liabilities) $ (423) $ (85) In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management believes it is more likely than not that the deferred tax assets will not be realized; accordingly, a valuation allowance has been established on U.S. and foreign net deferred tax assets. The Company has a net deferred tax liability as of December 31, 2021 due to indefinite- lived assets that are not amortizable for US GAAP purposes. The valuation allowance increased $2,157 and $10,123 as of December 31, 2021 and 2020, respectively. As of December 31, 2021, the Company has net operating loss carryforwards for federal income tax purposes of $34,877 available to reduce future income subject to income taxes, of which $11,130 will begin to expire, if not utilized, in fiscal 2037. The remaining amount of federal net operating loss carryforwards will be carried forward indefinitely. In addition, the Company has $30,679 and $13,627 of net operating loss carryforwards available to reduce future taxable income subject to California state income taxes and all other applicable state jurisdictions, respectively. The California net operating loss carryforwards will begin to expire, if not utilized, in fiscal year 2036. The other states net operating loss carryforwards will begin to expire, if not utilized, in fiscal year 2037. The foreign net operating loss carryforwards of $505 do not expire. F-60 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data Changes in our unrecognized tax benefits are summarized as follows: As of December 31, 2021 2020 Beginning Balance $ 43 $ 34 Additions for current year items 115 9 Additions for prior year items 269 Reductions for prior year items Lapse of statute of limitations Ending Balance $ 427 $ 43 The Company accounts for interest and penalties related to unrecognized tax benefits as part of its provision for (benefit from) income taxes on the consolidated statements of operations and comprehensive loss. During the years ended December 31, 2021 and 2020, interest and penalties were immaterial. The Company does not expect any significant change in its unrecognized tax benefits during the next twelve months that would be material to the consolidated financial statements. All of the unrecognized tax benefits would impact the effective tax rate. The Company files income tax returns for U.S. federal income tax, several U.S. states, and other foreign jurisdictions. The Company s most significant tax jurisdiction is the United States. The Company s tax years for 2009 and forward are subject to examination by the federal and state tax authorities. The Company s tax years for 2011 and forward are subject to examination by the foreign tax authorities. The Company is not currently under examination for income tax in any jurisdiction. The Company is currently not subject to any income tax audits by federal or state taxing authorities. The statute of limitations for tax liabilities for all years remains open. 14.Net Loss per Share The holders of Class AA, Class EE-1 and Class EE-2 common stock are entitled to the same right to participate in the Company s gains or losses. Therefore, net loss per share is presented as a single class of common stock. The computation of net loss per share is as follows: Year Ended December 31, 2021 2020 Numerator: Net loss attributable to common stockholders, basic and diluted $ (18,499) $ (9,712) Denominator: Weighted-average number of shares used to compute net loss per share attributable to common stockholders, basic and diluted. 17,386,008 11,946,614 Net loss per share attributable to common stockholders, basic and diluted $ (1.06) $ (0.81) The following potentially dilutive shares were excluded in the calculation of diluted shares outstanding as the effect would have been anti-dilutive: Year Ended December 31 2021 2020 Convertible notes 1,714,765 Convertible preferred stock 23,668,198 15,717,345 Outstanding stock options 5,031,310 3,209,063 Warrants to purchase common stock 74,895 74,895 Warrants to purchase convertible preferred stock 1,133,725 1,133,725 Common stock subject to repurchase 3,650,675 3,084,252 Total 33,558,803 24,934,045 F-61 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data 15.Related Party Transactions The Company entered into client engagement agreements with certain companies to serve as exclusive transaction agent to help facilitate private purchases of shares of issuers. These companies are identified as related parties who are holders of either the Company's common stock or redeemable convertible preferred stock. The Company recognized $1,186 in placement fee revenue in the consolidated statements of operations and comprehensive loss for trade executed with these companies for the year ended December 31, 2021. The associated revenue recognized for the year ended December 31, 2020 is immaterial. The Company obtains insurance coverage from Munich Re, a shareholder of the Company, to indemnify Forge Investments for its contractual obligations to funds investors if shareholders fail to transfer ownership interests upon certain trigger events. During the years ended December 31, 2021 and 2020, the Company incurred $274 and $1,121 in insurance premiums, respectively, and are included in transaction-based expenses in the consolidated statements of operations and comprehensive loss. Financial Technology Partners LP ( Financial Technology Partners ), a shareholder of the Company, serves as financial and strategic advisor which advised the Company on its financing, merger and acquisition transactions. During the years ended December 31, 2021 and 2020, the Company incurred $4,930 and $3,466 in fees to Financial Technology Partners, respectively, and are included in accrued expenses and other current liabilities in the consolidated balance sheets. The Company leases one of its office spaces from the former owner of IRA Services. The former owner became a shareholder of the Company upon the acquisition of IRA Services which subsequently renamed as Forge Trust. IRA Services was a non-depository trust company authorized to act as a custodian of self-directed individual retirement accounts. The Company incurred $377 in rent to this shareholder during the years ended December 31, 2021 and 2020, respectively, and are included in rent and occupancy in the consolidated statements of operations and comprehensive loss. In October 2019, the Company issued convertible notes to investors, of which $2,400 was received from certain members of the Company s board of directors and two key employees. As of December 31, 2020, the Company had $2,400 related party balance on the convertible notes outstanding under the 2019 Convertible Notes. The notes were fully repaid in January 2021 (Note 6). In October 2020, the Company issued 285,903 shares of Class AA common stock in exchange for a note receivable of $457 with certain related party for early exercise of options. The notes have a term of 7.0 years and bear interest at a rate of 0.38% per annum, compounded annually. In January and March 2021, the Company issued 391,042 shares of Class AA common stock in exchange for a note receivable of $626 with certain related party for early exercise of options. The notes have a term of 7.0 years to 9.0 years, and bear interest at a rate from 0.52% to 0.62% per annum, compounded annually. These loans have not been paid as of December 31, 2021. The Company did not recognize the promissory notes as notes receivables on its consolidated balance sheets as the notes are nonrecourse in their entirety and are not aligned with a corresponding percentage of the underlying shares. 16.Subsequent Events The Company has performed an evaluation of the impact of subsequent events through March 21, 2022, the date the consolidated financial statements were available to be issued and identified the following subsequent events. Merger Agreement On September 13, 2021, the Company entered into the Agreement and Plan of Merger (the Merger Agreement ) among Motive Capital Corp., a blank check company incorporated as a Cayman Islands exempted company in 2020 ( MOTV ), and FGI Merger Sub Inc. (the Merger Sub ) (the Merger ). In connection with the Merger, MOTV changed its jurisdiction of incorporation from the Cayman Islands to the State of Delaware (the Domestication) and changed its name to Forge Global Holdings, Inc. ( New Forge ). On the Closing Date, Merger Sub merged with and into the Company, with the Company being the surviving corporation and a wholly owned subsidiary of MOTV (together with the Merger and the Domestication, the Business Combination ). The closing of the Merger is referred to herein as the Closing . F-62 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data The Closing occurred on March 21, 2022 (the Closing Date ). The transaction is expected to be accounted for as a reverse recapitalization. Gross proceeds of $215.6 million were received at the Closing. PIPE Investment and A&R FPA Concurrently with the execution of the Merger Agreement, MOTV entered into Subscription Agreements (the Subscription Agreements ) with certain investors (the PIPE Investors ), pursuant to which the PIPE Investors have agreed to subscribe for and purchase, and MOTV has agreed to issue and sell to the PIPE Investors, an aggregate of 6,800,000 shares of Domestication Common Stock at a price of $10.00 per share, for aggregate gross proceeds of $68,000,000 (the PIPE Financing ). Pursuant the A&R FPA, certain MOTV fund vehicles managed by an affiliate of MOTV purchased 14,000,000 units at $10.00 per unit, for an aggregate purchase price of $140.0 million in a private placement that closed substantially concurrently with the closing of the Business Combination ( the Closing ). Each unit consists of one share of Domestication Common Stock and one-third of one Domestication Public Warrant. Transaction Bonus On March 21, 2022, as defined in the amended employment agreements between certain executives and the Company, these executives received a bonus of $15.8 million upon the Closing of the Merger, subject to their continued employment through the date of payment (the Transaction Bonus ). In March, 2022, the Company entered into a loan offset agreement with certain executives (the Loan Offset Agreement ) as a result of outstanding promissory notes that were due from these executives as of December 31, 2021, as disclosed in Note 12. As a result of the Loan Offset Agreement, the Company has agreed to offset the after-tax value of the Transaction Bonus that the executives are entitled to receive against the entire outstanding balance of the nonrecourse promissory notes, including any unpaid interest, as of one day immediately prior to the closing of the Merger. The total amount of outstanding promissory notes that are to be offset against the Transaction Bonus is $5.5 million. Retention Equity Grant On March 21, 2022, pursuant to agreements entered into with certain executives, and subject to the effectiveness of New Forge s registration statement and executive s continued employment through the applicable grant date, certain executives will be eligible to receive an equity bonus in the form of restricted stock units (each, a Retention Equity Grant ) having the total value of at least 15.8 million. Such Retention Equity Grant will vest annually, subject to the executive s employment through the applicable vesting dates. With respect to the grants made to certain executives, the Retention Equity Grant will become eligible to vest after the expiration of the six-month period following the closing of the Business Combination (the Lock-Up Period ). Purchase Commitments In the first quarter of fiscal 2022, the Company entered into non-cancelable purchase commitments with various parties mainly for software products and services. The purchase commitments are anticipated to commence in the first quarter of 2022. The total purchase obligations over the terms of 12 months or longer are approximately $915 in 2022 and $54 thereafter. 2022 Equity Incentive Plan In March, 2022, MOTV s board of directors and stockholders approved the 2022 Equity Incentive Plan (the 2022 Plan ). No grants will be made under the 2022 Plan prior to its effectiveness. Once the 2022 Plan becomes effective, no further grants will be made under the 2018 Plan. 12,899,504 shares of common stock of New Forge will be reserved for the issuance of awards under the 2022 Plan. In addition, the number of shares of common stock reserved and available for issuance under the 2022 Plan will automatically increase on January 1 of each year for a period of ten years, beginning on January 1, 2022 and continuing through January 1, 2032, in an amount equal to (1) 3% of the outstanding number of shares of common stock of New Forge on the preceding December 31, or (2) a lesser number of shares as approved by the Board of Directors. F-63 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data 2022 Employee Stock Purchase Plan In March, 2022, MOTV s board of directors and stockholders approved the 2022 Employee Stock Purchase Plan (the 2022 ESPP ). The 2022 ESPP will authorize the issuance of 4,072,000 shares of common stock of New Forge under purchase rights granted to our employees or to employees of any of our designated affiliates. The number of shares of common stock reserved for issuance will automatically increase on January 1 of each year, beginning on January 1, 2022, by the lesser of (i) 4,072,000 shares of common stock of New Forge, (ii) 1% of the outstanding number of shares of common stock of New Forge on the immediately preceding December 31, the New Forge board of directors may determine that such increase will be less than the amount set forth in clauses (i) and (ii). D&O Insurance Effective March 21, 2022, the Company entered into a D&O insurance policy with an annual premium totaling $5.6 million. The insurance may cover certain liabilities arising from its obligation to indemnify its directors and certain of its officers and employees, and former officers, directors, and employees of acquired companies, in certain circumstances. F-64 Table of Contents FORGE GLOBAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2021 and 2020 In thousands of U.S. dollars, except share and per share data Schedule II The tables below detail the activity of the allowance for doubtful accounts and valuation allowance on deferred tax assets for the years ended December 31, 2020 and 2021: Balance at beginning of Charged to Charges utilized/ Balance at period expenses Write-offs end of period Allowance for doubtful accounts: Year ended December 31, 2020 $ 1,114 $ 424 $ 1,538 Year ended December 31, 2021 $ 1,538 $ 21 $ 1,517 Balance at Addition Charged beginning of from (credited) to Balance at period acquisition expenses end of period Valuation allowance on deferred tax assets: Year ended December 31, 2020 $ (2,156) $ (9,401) $ (721) $ (12,278) Year ended December 31, 2021 $ (12,278) $ (2,158) $ (14,436) F-65 Table of Contents Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of Motive Capital Corp Opinion on the Consolidated Financial Statements We have audited the accompanying consolidated balance sheets of Motive Capital Corp (the Company ) as of December 31, 2021 and 2020, the related consolidated statements of operations, changes in shareholders deficit and cash flows for the year ended December 31, 2020, and period from September 28, 2020 (inception) through December 31, 2020, and the related notes (collectively referred to as the consolidated financial statements ). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for the year ended December 31, 2020, and period from September 28, 2020 (inception) through December 31, 2020, in conformity with accounting principles generally accepted in the United States of America. Going Concern The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, if the Company is unable to raise additional funds to alleviate liquidity needs and complete a business combination by December 15, 2022, then the Company will cease all operations except for the purpose of liquidating. The liquidity condition and date for mandatory liquidation and subsequent dissolution raise substantial doubt about the Company s ability to continue as a going concern. Management s plans in regard to these matters are also described in Note 1. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Basis for Opinion These consolidated financial statements are the responsibility of the Company s management. Our responsibility is to express an opinion on the Company s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ( PCAOB ) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. /s/ WithumSmith+Brown, PC We have served as the Company s auditor since 2020. New York, New York March 16, 2022 PCAOB ID NUMBER 100 F-66 Table of Contents Motive Capital Corp CONSOLIDATED BALANCE SHEETS December 31, 2021 2020 Assets: Current assets: Cash $ 254,726 $ 1,674,650 Prepaid expenses 274,234 651,605 Total current assets 528,960 2,326,255 Cash and Investments held in Trust Account 414,111,439 414,020,525 Total Assets $ 414,640,399 $ 416,346,780 Liabilities, Class A Ordinary Shares Subject to Possible Redemption and Shareholders Deficit: Current liabilities: Accounts payable $ 4,358,705 $ 961 Accrued expenses 1,089,571 415,560 Total current liabilities 5,448,276 416,521 Deferred underwriting commissions 14,490,000 14,490,000 Derivative liabilities 24,430,400 40,532,280 Total liabilities 44,368,676 55,438,801 Commitments and Contingencies Class A ordinary shares, $0.0001 par value; 41,400,000 shares subject to possible redemption at $10.00 per share at December 31, 2021 and 2020 414,000,000 414,000,000 Shareholders Deficit: Preference shares, $0.0001 par value 5,000,000 shares authorized none issued and outstanding Class A ordinary shares, $0.0001 par value; 500,000,000 shares authorized at December 31, 2021 and 2020; no non-redeemable shares issued or outstanding Class B ordinary shares, $0.0001 par value; 50,000,000 shares authorized; 10,350,000 shares issued and outstanding 1,035 1,035 Additional paid-in capital Accumulated deficit (43,729,312) (53,093,056) Total shareholders deficit (43,728,277) (53,092,021) Total Liabilities, Class A Ordinary Shares Subject to Possible Redemption and Shareholders Deficit $ 414,640,399 $ 416,346,780 The accompanying notes are an integral part of these consolidated financial statements. F-67 Table of Contents Motive Capital Corp CONSOLIDATED STATEMENTS OF OPERATIONS For the Period From September 28, 2020 For the Year Ended (Inception) through December 31, 2021 December 31, 2020 General and administrative expenses $ 6,829,050 $ 35,004 Loss from operations (6,829,050) (35,004) Other income (expense) Change in fair value of derivative liabilities 16,101,880 (10,659,080) Transaction costs - derivative liabilities (1,126,070) Gain on marketable securities, dividends and interest held in Trust Account 90,914 20,525 Net income (loss) $ 9,363,744 $ (11,799,629) Weighted average shares outstanding of Class A redeemable ordinary shares 41,400,000 7,650,000 Basic and diluted net income (loss) per share, Class A redeemable ordinary shares $ 0.18 $ (0.66) Weighted average shares outstanding of Class B non-redeemable ordinary shares 10,350,000 10,350,000 Basic and diluted net income (loss) per share, Class B non-redeemable ordinary shares $ 0.18 $ (0.66) The accompanying notes are an integral part of these consolidated financial statements. F-68 Table of Contents Motive Capital Corp CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS DEFICIT For the Year Ended December 31, 2021 Ordinary Shares Additional Total Class A Class B Paid-in Accumulated Shareholders Shares Amount Shares Amount Capital Deficit Deficit Balance - December 31, 2020 $ 10,350,000 $ 1,035 $ $ (53,093,056) $ (53,092,021) Net income 9,363,744 9,363,744 Balance - December 31, 2021 $ 10,350,000 $ 1,035 $ $ (43,729,312) $ (43,728,277) For the Period From September 28, 2020 (Inception) through December 31, 2020 Ordinary Shares Additional Total Class A Class B Paid-in Accumulated Shareholders Shares Amount Shares Amount Capital Deficit Deficit Balance - September 28, 2020 (inception) $ $ $ $ $ Issuance of Class B ordinary shares to Sponsor 10,350,000 1,035 23,965 25,000 Cash received in Private Placement in excess of initial fair value of Private Placement warrants 664,800 664,800 Accretion of Class A ordinary shares subject to possible redemption amount (688,765) (41,293,427) (41,982,192) Net loss (11,799,629) (11,799,629) Balance - December 31, 2020 $ 10,350,000 $ 1,035 $ $ (53,093,056) $ (53,092,021) The accompanying notes are an integral part of these consolidated financial statements. F-69 Table of Contents Motive Capital Corp CONSOLIDATED STATEMENTS OF CASH FLOWS For the Period From September 28, 2020 For the Year Ended (Inception) through December 31, 2021 December 31, 2020 Cash Flows from Operating Activities: Net income (loss) $ 9,363,744 $ (11,799,629) Adjustments to reconcile net income (loss) to net cash used in operating activities: Transaction cost - derivative liabilities 1,126,070 Change in fair value of derivative warrant liabilities (16,101,880) 10,659,080 Gain on marketable securities, dividends and interest held in Trust Account (90,914) (20,525) Changes in operating assets and liabilities: Prepaid expenses 377,371 (651,605) Accounts payable 4,357,744 961 Accrued expenses 674,011 5,560 Net cash used in operating activities (1,419,924) (680,088) Cash Flows from Investing Activities: Cash deposited in Trust Account (414,000,000) Net cash used in investing activities (414,000,000) Cash Flows from Financing Activities: Repayment of note payable to related parties (130,492) Proceeds received from initial public offering, gross 414,000,000 Offering costs paid (8,619,770) Proceeds received from private placement 11,080,000 Proceeds from issuance of ordinary shares to initial shareholders 25,000 Net cash provided by financing activities 416,354,738 Net change in cash (1,419,924) 1,674,650 Cash - beginning of the period 1,674,650 Cash - end of the period $ 254,726 $ 1,674,650 Supplemental disclosure of noncash financing activities: Deferred underwriting commissions charged to additional paid-in capital in connection with initial public offering $ $ 14,490,000 Offering costs included in accrued expenses $ $ 410,000 Offering costs charged to additional paid-in capital in connection with the initial public offering $ $ 880,262 The accompanying notes are an integral part of these consolidated financial statements. F-70 Table of Contents MOTIVE CAPITAL CORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 1 Description of Organization and Business Operations Motive Capital Corp (the Company ) is a blank check company incorporated as a Cayman Islands exempted company on September 28, 2020 under the name of MCF2 Acquisition Corp. On November 5, 2020 the Company s name was changed to Motive Capital Corp. The Company was incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities (a Business Combination ). The Company is not limited to a particular industry or sector for purposes of consummating a Business Combination. The Company is an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As of December 31, 2021, the Company had not commenced any operations. Our entire activity from September 28, 2020 (inception) through December 31, 2021, was in preparation for an Initial Public Offering, and since our Initial Public Offering, our activity has been limited to the search and due diligence for a prospective initial Business Combination. The Company will not generate any operating revenues until after completion of its Initial Business Combination, at the earliest. The Company generates non-operating gain or loss from the change in fair value of derivative liabilities and non-operating income in the form of interest income, gain on marketable securities, and dividends from the proceeds of its Initial Public Offering and Private Placement described below. The registration statement for the company s Initial Public Offering was declared effective on December 10, 2020. On December 15, 2020, the Company consummated the Initial Public Offering of 41,400,000 units (the Units and, with respect to the Class A ordinary shares included in the Units sold, the Public Shares ) which includes the full exercise by the underwriter of its over-allotment option in the amount of 5,400,000 Units, at $10.00 per Unit, generating gross proceeds of $414,000,000. Simultaneously with the closing of the Initial Public Offering, the Company consummated the sale of 7,386,667 warrants (the Private Placement Warrants ) at a price of $1.50 per Private Placement Warrant in a private placement to Motive Capital Funds Sponsor, LLC (the Sponsor ), generating gross proceeds of $11,080,000. Transaction costs amounted to $23,650,262, consisting of $8,280,000 of underwriting fees, $14,490,000 of deferred underwriting fees and approximately $900,000 of other offering costs. Following the closing of the Initial Public Offering on December 15, 2020, an amount of $414,000,000 ($10.00 per Unit) from the net proceeds of the sale of the Units in the Initial Public Offering and the sale of the Private Placement Warrants was placed in a trust account (the Trust Account ), and invested in U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less, or in any open-ended investment company that holds itself out as a money market fund investing solely in U.S. Treasuries and meeting certain conditions under Rule 2a-7 of the Investment Company Act, as determined by the Company, until the earliest of: (i) the completion of a Business Combination and (ii) the distribution of the funds in the Trust Account to the Company s shareholders, as described below. The Company s management has broad discretion with respect to the specific application of the net proceeds of the Initial Public Offering and the sale of the Private Placement Warrants, although substantially all of the net proceeds are intended to be applied generally toward consummating a Business Combination. The stock exchange listing rules require that the Business Combination must be with one or more operating businesses or assets with a fair market value equal to at least 80% of the assets held in the Trust Account (excluding the amount of any deferred underwriting discount held in the Trust Account). The Company will only complete a Business Combination if the post-Business Combination company owns or acquires 50% or more of the issued and outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). There is no assurance that the Company will be able to successfully effect a Business Combination. The Company will provide the holders of the public shares (the Public Shareholders ) with the opportunity to redeem all or a portion of their public shares upon the completion of the Business Combination, either (i) in connection with a general meeting called to approve the Business Combination or (ii) by means of a tender offer. The decision as to whether the Company will seek shareholder approval of a Business Combination or conduct a tender offer will be made by the Company, solely in its discretion. The Public Shareholders will be entitled to redeem their Public Shares, equal to the aggregate amount then on deposit in the Trust Account, calculated as of two business days prior to the consummation of the Business Combination (initially anticipated to be $10.00 per Public Share), including interest (which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares, subject to certain limitations as described in the prospectus. The per-share amount to be distributed to the Public Shareholders who properly redeem their shares will not be reduced by the deferred underwriting commissions the Company will pay F-71 Table of Contents MOTIVE CAPITAL CORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS to the underwriters (as discussed in Note 6). There will be no redemption rights upon the completion of a Business Combination with respect to the Company s warrants. The Public Shares are classified as temporary equity in accordance with the Financial Accounting Standards Board s ( FASB ) Accounting Standards Codification ( ASC ) Topic 480 Distinguishing Liabilities from Equity ( ASC 480 ). The Company will proceed with a Business Combination only if the Company has net tangible assets of at least $5,000,001 and, if the Company seeks shareholder approval, it receives an ordinary resolution under Cayman Islands law approving a Business Combination, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the Company. If a shareholder vote is not required and the Company does not decide to hold a shareholder vote for business or other legal reasons, the Company will, pursuant to its Amended and Restated Memorandum and Articles of Association, conduct the redemptions pursuant to the tender offer rules of the Securities and Exchange Commission ( SEC ), and file tender offer documents containing substantially the same information as would be included in a proxy statement with the SEC prior to completing a Business Combination. If the Company seeks shareholder approval in connection with a Business Combination, the Sponsor has agreed to vote its Founder Shares (as defined in Note 5) and any Public Shares purchased during or after the Initial Public Offering in favor of approving a Business Combination. Additionally, each Public Shareholder may elect to redeem their Public Shares, without voting, and if they do vote, irrespective of whether they vote for or against a proposed Business Combination. Notwithstanding the foregoing, if the Company seeks shareholder approval of the Business Combination and the Company does not conduct redemptions pursuant to the tender offer rules, a Public Shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the Exchange Act )), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the Public Shares without the Company s prior written consent. The Sponsor has agreed (a) to waive its redemption rights with respect to any Founder Shares and Public Shares held by it in connection with the completion of a Business Combination and (b) not to propose an amendment to the Amended and Restated Memorandum and Articles of Association (i) to modify the substance or timing of the Company s obligation to allow redemption in connection with the Company s initial Business Combination or to redeem 100% of the Public Shares if the Company does not complete a Business Combination within the Combination Period (as defined below) or (ii) with respect to any other provision relating to shareholders rights or pre-initial business combination activity, unless the Company provides the Public Shareholders with the opportunity to redeem their Public Shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned on the Trust Account and not previously released to pay taxes, divided by the number of then issued and outstanding Public Shares. The Company will have until December 15, 2022 to consummate a Business Combination (the Combination Period ). However, if the Company has not completed a Business Combination within the Combination Period, the Company will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem 100% of the Public Shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned and not previously released to us to pay our taxes, if any (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then issued and outstanding Public Shares, which redemption will completely extinguish the rights of the Public Shareholders as shareholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of the Company s remaining Public Shareholders and its Board of Directors, liquidate and dissolve, subject in each case to the Company s obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to the Company s warrants, which will expire worthless if the Company fails to complete a Business Combination within the Combination Period. The Sponsor has agreed to waive its rights to liquidating distributions from the Trust Account with respect to the Founder Shares it will receive if the Company fails to complete a Business Combination within the Combination Period. However, if the Sponsor or any of its respective affiliates acquire Public Shares, such Public Shares will be entitled to liquidating distributions from the Trust Account if the Company fails to complete a Business Combination within the Combination Period. The underwriters have agreed to waive their rights to their deferred underwriting commission (see Note 6) held in the Trust Account in the event the Company does not complete a Business Combination within the Combination Period, and in such event, such amounts will be included with the other funds held in the Trust Account that will be available to fund the redemption of the Public Shares. In the event of such distribution, it is possible that the per share value of the assets remaining available for distribution will be less than the Initial Public Offering price per Unit ($10.00). F-72 Table of Contents MOTIVE CAPITAL CORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS In order to protect the amounts held in the Trust Account, the Sponsor has agreed that it will be liable to the Company if and to the extent any claims by a third party (other than the Company s independent registered public accounting firm) for services rendered or products sold to the Company, or a prospective target business with which the Company has discussed entering into a transaction agreement, reduce the amount of funds in the Trust Account to below the lesser of (1) $10.00 per Public Share and (2) the actual amount per Public Share held in the Trust Account as of the date of the liquidation of the Trust Account, if less than $10.00 per Public Share, due to reductions in the value of trust assets, in each case net of the interest that may be withdrawn to pay taxes. This liability will not apply to any claims by a third party who executed a waiver of any and all rights to seek access to the Trust Account and as to any claims under the Company s indemnity of the underwriters of the Initial Public Offering against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the Securities Act ). In the event that an executed waiver is deemed to be unenforceable against a third party, the Sponsor will not be responsible to the extent of any liability for such third-party claims. The Company will seek to reduce the possibility that the Sponsor will have to indemnify the Trust Account due to claims of creditors by endeavoring to have all vendors, service providers (other than the Company s independent registered public accounting firm), prospective target businesses or other entities with which the Company does business, execute agreements with the Company waiving any right, title, interest or claim of any kind in or to monies held in the Trust Account. Proposed Business Combination On September 13, 2021, the Company entered into an Agreement and Plan of Merger (as it may be amended, supplemented or otherwise modified from time to time, the Merger Agreement ), by and among the Company, FGI Merger Sub Inc., a Delaware corporation and a direct wholly owned subsidiary of the Company ( Merger Sub ), and Forge Global, Inc., a Delaware corporation ( Forge ). The Merger Agreement provides for, among other things, the following transactions: (i) the Company will change its jurisdiction of incorporation by transferring by way of continuation from the Cayman Islands and domesticating as a corporation incorporated under the laws of the State of Delaware (the Domestication ), and, in connection with the Domestication, (A) each outstanding Class A ordinary share of the Company will convert automatically into one share of common stock, par value $0.0001 per share (the Domesticated Company Common Stock ), (B) each outstanding Class B ordinary share of the Company will convert automatically into one share of Domesticated Company Common Stock, (C) each outstanding warrant to purchase one Class A ordinary share at an exercise price of $11.50 that was included in the Units sold as part of Company s initial public offering (a Public Warrant ) will convert automatically, on a one-for-one basis, into a warrant to acquire one share of Domesticated Company Common Stock ( Domesticated Company Public Warrant ), (D) each outstanding Private Placement Warrant issued to the Sponsor will convert automatically, on a one-for-one basis, into a warrant to acquire one share of Domesticated Company Common Stock and (E) each outstanding Unit of the Company, to the extent not already split by the holder thereof, convert automatically, into one share of Domesticated Company Common Stock and one-third of one Domesticated Company Public Warrant; and (ii) immediately following the Domestication, Merger Sub will merge with and into Forge, with Forge surviving as a wholly owned subsidiary of the Company (the Merger ). Subject to the terms and conditions set forth in the Merger Agreement, in consideration of the Merger, each outstanding share of Forge s capital stock (excluding shares owned by the Company or by Forge as treasury stock or dissenting shares) (i) if vested, will be canceled and converted into the right to receive either cash or Domesticated Company Common Stock, or a combination thereof, equal to the Per-Share Merger Consideration, which mix of cash and stock shall correspond to that elected by each of holder of Forge vested shares; provided, that in no event shall a holder of Forge vested shares be permitted to elect greater than fifteen percent (15%) cash and in no event will the aggregate amount of cash payable to all holders of vested Forge shares exceed $100 million and (ii) if unvested, will be canceled and converted into the right to receive a number of shares of unvested Domesticated Company Common Stock (subject to the same terms and conditions, including with respect to vesting, as the unvested share of Forge s capital stock) equal to (A) the Securities Merger Consideration multiplied by (B) the Exchange Ratio. The total consideration paid to holders of Forge s outstanding equity securities will include shares of Domesticated Company Common Stock and options and warrants to acquire shares of Domesticated Company Common Stock, having an aggregate value equal to $1.5 billion, less the amount of any cash consideration payable to holders of vested Forge shares, consisting of (assuming the maximum amount of cash consideration) an aggregate of 140 million newly issued shares of Domesticated Company Common Stock and options and warrants to acquire shares of Domesticated Company Common Stock, in each case, with a deemed value of $10.00 per share solely for purposes of determining the aggregate number of shares payable to holders of Forge capital stock. As a result, at the closing of the Merger and the other transactions contemplated by the Merger Agreement (the Closing ), (i) each outstanding option to purchase Forge capital stock, whether vested or unvested, will be assumed and converted into an option with respect to a number of shares of Domesticated Company Common Stock in the manner set forth in the Merger Agreement and (ii) each outstanding warrant to purchase Forge capital stock, whether or not exercisable, will be assumed and converted into a warrant with respect to a number of shares of Domesticated Company Common Stock in the manner set forth in the Merger Agreement. F-73 Table of Contents MOTIVE CAPITAL CORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Concurrent with the execution of the Merger Agreement, the Company entered into that certain Sponsor Support Agreement (the Sponsor Agreement ) with the Sponsor, Forge and other holders of Company s Class B ordinary shares pursuant to which the Sponsor and such holders of Class B ordinary shares have agreed to (i) vote all shares of the Company they own in favor of the transactions contemplated by the Merger Agreement, (ii) waive certain anti-dilution rights with respect to their Class B ordinary shares, and (iii) agree to certain lock-up provisions. Concurrent with the execution of the Merger Agreement, the Company entered into that certain Stockholder Support Agreement (the Stockholder Support Agreement ) with Forge and certain Forge shareholders (the Supporting Shareholders ) pursuant to which the Supporting Shareholders agreed to vote in favor of the Merger and the transactions contemplated. Concurrent with the execution of the Merger Agreement, the Company amended and restated that certain Forward Purchase Agreement, dated as of November 24, 2020, by and between the Company, the Sponsor and certain affiliates of the Sponsor (the Purchasers ; and such agreement the A&R Forward Purchase Agreement ). Pursuant to the A&R Forward Purchase Agreement, subject to the fulfillment of certain conditions, the Purchasers will collectively purchase concurrently with the Closing, at a per-unit price of $10.00, 5,000,000 Forward Purchase Units, each composed of one share of Domesticated Company Common Stock and one-third of one Domesticated Company Public Warrant (a Forward Purchase Unit ), and up to an additional 9,000,000 Forward Purchase Units to the extent of redemptions on a dollar-for-dollar basis by Company shareholders of all or a portion of their Class A ordinary shares. For the avoidance of doubt, regardless of the extent of such redemptions, the Purchasers will in no event be required to purchase more than an aggregate amount of 14,000,000 Forward Purchase Units. The Merger Agreement contemplates that, at the Closing, the Company, the Sponsor, and certain Company and Forge stockholders will enter into a registration rights agreement pursuant to which, among other things, the Company will agree to undertake certain customary registration obligations in accordance with the Securities Act and certain subsequent related transactions and obligations. Pursuant to the Registration Rights Agreement, the Company will agree that, within 30 calendar days after the Closing, the Company will file with the SEC a registration statement registering the resale of certain securities held by or issuable to the stockholders party thereto, and use its reasonable best efforts to have such registration statement declared effective by the SEC as soon as practicable thereafter. Concurrent with the execution of the Merger Agreement, the Company entered into subscription agreements (each, a Subscription Agreement ) with certain investors (the PIPE Investors ) pursuant to which, among other things, the PIPE Investors have agreed to subscribe for and purchase, and the Company has agreed to issue and sell to the PIPE Investors an aggregate of 6.85 million shares of Domesticated Company Common Stock, at a per share price of $10.00 for an aggregate purchase price of $68,500,000, concurrent with the Closing, on the terms and subject to the conditions set forth therein (the PIPE Financing ). The Subscription Agreement contains customary representations and warranties of the Company, on the one hand, and each PIPE Investor, on the other hand, and customary conditions to closing, including the consummation of the transactions contemplated by the Merger Agreement. Each Subscription Agreement provides that the Company will grant the PIPE Investors certain customary registration rights. Principles of Consolidation The consolidated financial statements of the Company include its wholly-owned subsidiary created in connection with the Proposed Business Combination. All inter-company accounts and transactions are eliminated in consolidation. Liquidity and Going Concern As of December 31, 2021, the Company had approximately $255,000 in the operating bank accounts, a working capital deficit of approximately $4.9 million and approximately $91,000 of interest income available in the Trust Account to pay for the Company s tax obligations, if any. In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the officers and directors may, but are not obligated to, loan us funds as may be required ( Working Capital Loans ). If the Company completes a Business Combination, the Company will repay the Working Capital Loans out of the proceeds of the Trust Account released to us. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist F-74 Table of Contents MOTIVE CAPITAL CORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants of the post-Business Combination entity at a price of $1.50 per warrant. The warrants would be identical to the Private Placement Warrants. As of December 31, 2021 and 2020, the Company had no outstanding borrowings under the Working Capital Loans. Based on the foregoing, including the ability of the Company to draw upon the Working Capital Loans, Management believes that the Company will have sufficient working capital and borrowing capacity to meet its needs through the earlier of the consummation of the Business Combination or the date the Company is required to liquidate. Over this time period, the Company will be using the working capital funds for paying existing accounts payable, paying for travel expenditures, and structuring, negotiating and consummating the Initial Business Combination. In connection with the Company's assessment of going concern considerations in accordance with FASB ASC Topic 205-40, Presentation of Financial Statements Going Concern, the Company has until December 15, 2022 to consummate a Business Combination. It is uncertain that the Company will be able to consummate a Business Combination by this time. If a Business Combination is not consummated by this date, there will be a mandatory liquidation and subsequent dissolution of the Company. Management has determined that the liquidity condition and mandatory liquidation, should a Business Combination not occur, and potential subsequent dissolution raises substantial doubt about the Company's ability to continue as a going concern. No adjustments have been made to the carrying amounts of assets or liabilities should the Company be required to liquidate after December 15, 2022. However, in order to finance transaction costs in connection with a Business Combination, the Company s Sponsor or an affiliate of the Sponsor, or certain of the Company s officers and directors may loan the Company funds as may be required ( Working Capital Loans ). Based on the foregoing, including the ability of the Company to draw upon the Working Capital Loans, Management believes that the Company will have sufficient working capital and borrowing capacity to meet its needs through the consummation of the Business Combination, which the Company intends to complete by December 15, 2022. Note 2 Basis of Presentation and Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements are presented in U.S. dollars in conformity with accounting principles generally accepted in the United States of America ( GAAP ) for financial information and pursuant to the rules and regulations of the SEC. Emerging Growth Company The Company is an emerging growth company, as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that an emerging growth company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such an election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company s consolidated financial statements with another public company that is neither an emerging growth company nor an emerging growth company that has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. F-75 Table of Contents MOTIVE CAPITAL CORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates. Cash and Cash Equivalents The Company considers all short-term investments with an original maturity of three months or less when purchased to be cash equivalents. As of December 31, 2021 and 2020 there were no cash equivalents not held in the Trust Account. Investments Held in Trust Account The Company s portfolio of investments held in trust is comprised solely of U.S. government securities, within the meaning set forth in Section 2(a)(16) of the Investment Company Act, with a maturity of 185 days or less, or investments in money market funds that invest in U.S. government securities and generally have a readily determinable fair value, or a combination thereof. When the Company s investments held in the Trust Account are comprised of U.S. government securities, the investments are classified as trading securities. When the Company s investments held in the Trust Account are comprised of money market funds, the investments are recognized at fair value. Trading securities are presented on the balance sheets at fair value at the end of each reporting period. Gains and losses resulting from the change in fair value of these investments are included in gain on marketable securities, dividends and interest held in Trust Account in the accompanying consolidated statements of operations. The estimated fair values of investments held in the Trust Account are determined using available market information. Concentration of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution, which, at times, may exceed the Federal Depository Insurance Corporation coverage limit of $250,000 and investments held in Trust Account. As of December 31, 2021 and 2020, the Company has not experienced losses on these accounts and management believes the Company is not exposed to significant risks on such accounts. Fair Value of Financial Instruments Fair value is defined as the price that would be received for sale of an asset or paid for transfer of a liability, in an orderly transaction between market participants at the measurement date. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). These tiers consist of: Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets; Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. F-76 Table of Contents MOTIVE CAPITAL CORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS In some circumstances, the inputs used to measure fair value might be categorized within different levels of the fair value hierarchy. In those instances, the fair value measurement is categorized in its entirety in the fair value hierarchy based on the lowest level input that is significant to the fair value measurement. As of December 31, 2021 and 2020, the carrying values of cash, prepaid expenses, accounts payable and accrued expenses approximate their fair values primarily due to the short-term nature of the instruments. The Company s portfolio of investments held in the Trust Account is comprised of investments in U.S. Treasury securities with an original maturity of 185 days or less or investments in money market funds that invest in U.S. government securities, or a combination thereof. The fair value for trading securities is determined using quoted market prices in active markets. Prior to the Public Warrants being separately traded in an active market, the fair value of the Public Warrants issued in connection with the Public Offering and the Private Placement Warrants were measured using a binomial lattice model in a risk-neutral framework. The fair value of the forward purchase agreement is based on the fair value of the Company s publicly traded Units on each valuation date, less the present value of the contractually stipulated forward price of $10.00. Beginning in February 2021, the fair value of the Public Warrants are determined based on the listed price in an active market for such warrants and the fair value of the Private Placement Warrants is estimated to be approximately equal to that of the Public Warrants given the low likelihood of the Company s ordinary share price exceeding $18.00 by the start of the exercise period. Derivative Liabilities The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 and FASB ASC Topic 815, Derivatives and Hedging ( ASC 815 ). The Public Warrants, Private Placement Warrants and the forward purchase agreement are recognized as derivative liabilities in accordance with ASC 815. Accordingly, the Company recognizes the warrant instruments as liabilities at fair value and adjusts the carrying value of the instruments to fair value at each reporting period until they are exercised. The initial fair value of the Public Warrants issued in connection with the Initial Public Offering were estimated using a binomial lattice model in a risk-neutral framework. The fair value of the Public Warrants as of December 31, 2021 is based on observable listed prices for such warrants. The fair value of the Private Placement Warrants as of December 31, 2021 is based on the value of the Public Warrants given the low likelihood of the Company s ordinary share price exceeding $18.00 by the start of the exercise period. The fair value of the forward purchase agreement is based on the fair value of the Company s publicly traded Units on each valuation date, less the present value of the contractually stipulated forward price of $10.00. The determination of the fair value of derivative liabilities may be subject to change as more current information becomes available and accordingly the actual results could differ significantly. Derivative liabilities are classified as non-current liabilities as their liquidation is not reasonably expected to require the use of current assets or require the creation of current liabilities. Offering Costs Associated with the Initial Public Offering Offering costs consist of legal, accounting, underwriting fees and other costs incurred that are directly related to the Initial Public Offering. Offering costs are allocated to the separable financial instruments issued in the Initial Public Offering based on a relative fair value basis, compared to total proceeds received. Offering costs associated with derivative liabilities are expensed as incurred, presented as non-operating expenses in the consolidated statements of operations. Offering costs associated with the Public Shares were charged against the carrying value of the Class A ordinary shares subject to possible redemption upon completion of the Initial Public Offering. Class A Ordinary Shares Subject to Possible Redemption The Company accounts for its Class A ordinary shares subject to possible redemption in accordance with the guidance in ASC 480. Class A ordinary shares subject to mandatory redemption (if any) are classified as liability instruments and are measured at fair value. Conditionally redeemable Class A ordinary shares (including Class A ordinary shares that feature redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within the Company s control) are classified as temporary equity. At all other times, Class A ordinary shares are classified as shareholders equity. The Company s Class A ordinary shares feature certain redemption rights that are considered to be outside of the Company s F-77 Table of Contents MOTIVE CAPITAL CORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS control and subject to occurrence of uncertain future events. Accordingly, at December 31, 2021 and 2020, 41,400,000 shares of Class A ordinary shares subject to possible redemption is presented at redemption value as temporary equity, outside of the shareholders deficit section of the Company s balance sheets. Immediately upon the closing of the Initial Public Offering, the Company recognized the accretion from initial book value to redemption amount value. The change in the carrying value of Class A ordinary shares subject to possible redemption resulted in charges against additional paid-in capital and accumulated deficit. Under ASC 480-10-S99, the Company has elected to recognize changes in the redemption value immediately as they occur and adjust the carrying value of the security to equal the redemption value at the end of each reporting period. This method would view the end of the reporting period as if it were also the redemption date for the security. Income Taxes FASB ASC Topic 740, Income Taxes prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. There were no unrecognized tax benefits as of December 31, 2021 and 2020. The Company s management determined that the Cayman Islands is the Company s only major tax jurisdiction. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. No amounts were accrued for the payment of interest and penalties as of December 31, 2021 and 2020. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is considered an exempted Cayman Islands company with no connection to any other taxable jurisdiction and is presently not subject to income taxes or income tax filing requirements in the Cayman Islands or the United States. As such, the Company s tax provision was zero for the periods presented. The Company s management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months. Net Income (Loss) per Ordinary Share The Company complies with accounting and disclosure requirements of FASB ASC Topic 260, Earnings Per Share. The Company has two classes of shares, which are referred to as Class A ordinary shares and Class B ordinary shares. Income and losses are shared pro rata between the two classes of shares. Net income (loss) per ordinary share is calculated by dividing the net income (loss) by the weighted average ordinary shares outstanding for the respective period. The calculation of diluted net income (loss) does not consider the effect of the warrants underlying the Units sold in the Initial Public Offering and the private placement warrants to purchase an aggregate of 21,186,667 Class A ordinary shares in the calculation of diluted income (loss) per share, because their inclusion would be anti-dilutive under the treasury stock method. As a result, diluted net income (loss) per ordinary share is the same as basic net income (loss) per ordinary share for the year ended December 31, 2021 and for the period from September 28, 2020 (inception) through December 31, 2020. Accretion associated with the redeemable Class A ordinary shares is excluded from earnings per share as the redemption value approximates fair value. Recent Adopted Accounting Standards In August 2020, the Financial Accounting Standards Board issued ASU No. 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging Contracts in Entity s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity s Own Equity ( ASU 2020-06 ), which simplifies accounting for convertible instruments by removing major separation models required under current GAAP. The ASU also removes certain settlement conditions that are required for equity-linked contracts to qualify for the derivative scope exception, and it simplifies the diluted earnings per share calculation in certain areas. The Company adopted ASU 2020-06 on January 1, 2021. Adoption of the ASU did not impact the Company s financial position, results of operations or cash flows. Recent Issued Accounting Standards The Company s management does not believe that any recently issued, but not yet effective, accounting standards updates, if currently adopted, would have a material effect on the accompanying consolidated financial statements. F-78 Table of Contents MOTIVE CAPITAL CORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 3 Initial Public Offering Pursuant to the Initial Public Offering, the Company sold 41,400,000 Units, which includes a full exercise by the underwriters of their over-allotment option in the amount of 5,400,000 Units, at a purchase price of $10.00 per Unit. Each Unit consist of one Class A ordinary share and one-third of one redeemable Public Warrant. Each whole Public Warrant entitles the holder to purchase one Class A ordinary share at an exercise price of $11.50 per whole share (see Note 7). Note 4 Private Placement Simultaneously with the closing of the Initial Public Offering, the Sponsor purchased an aggregate of 7,386,667 Private Placement Warrants at a price of $1.50 per Private Placement Warrant, for an aggregate purchase price of $11,080,000, in a private placement. Each Private Placement Warrant is exercisable to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment (see Note 7). A portion of the proceeds from the Private Placement Warrants were added to the proceeds from the Initial Public Offering held in the Trust Account. If the Company does not complete a Business Combination within the Combination Period, the proceeds from the sale of the Private Placement Warrants will be used to fund the redemption of the Public Shares (subject to the requirements of applicable law) and the Private Placement Warrants will expire worthless. Note 5 Related Party Transactions Founder Shares On October 2, 2020, the Sponsor paid $25,000 to cover certain offering and formation costs of the Company in consideration for 11,500,000 Class B ordinary shares (the Founder Shares ). On November 24, 2020, the Sponsor surrendered 2,875,000 Founder Shares, which the Company canceled. On November 24 and December 8, 2020, the Sponsor transferred 30,000 founder shares to each of the independent directors. On December 10, 2020, the Company issued a dividend of 1,725,000 Class B ordinary shares, resulting in 10,350,000 Founder Shares outstanding. All share and per-share amounts have been retroactively restated to reflect the share cancellation. The Founder Shares include an aggregate of up to 1,350,000 shares that are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised, so that the number of Founder Shares will equal, on an as-converted basis, approximately 20% of the Company s issued and outstanding ordinary shares after the Proposed Public Offering. As a result of the underwriters election to fully exercise their over-allotment option, 1,350,000 Founder Shares are no longer subject to forfeiture. The Sponsor has agreed, subject to limited exceptions, not to transfer, assign or sell any of the Founder Shares until the earliest of: (A) one year after the completion of a Business Combination and (B) subsequent to a Business Combination, (x) if the closing price of the Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share sub-divisions, share dividends, rights issuances, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after a Business Combination, or (y) the date on which the Company completes a liquidation, merger, share exchange or other similar transaction that results in all of the Public Shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property. Related Party Loans In order to finance transaction costs in connection with a Business Combination, the Sponsor or an affiliate of the Sponsor, or certain of the Company s officers and directors may loan the Company funds as may be required ( Working Capital Loans ). If the Company completes a Business Combination, the Company would repay the Working Capital Loans out of the proceeds of the Trust Account released to the Company. Otherwise, the Working Capital Loans would be repaid only out of funds held outside the Trust Account. In the event that a Business Combination does not close, the Company may use a portion of proceeds held outside the Trust Account to repay the Working Capital Loans, but no proceeds held in the Trust Account would be used to repay the Working Capital Loans. Except for the foregoing, the terms of such Working Capital Loans, if any, have not been determined and no written agreements exist with respect to such loans. The Working Capital Loans would either be repaid upon consummation of a Business Combination, without interest, or, at the lender s discretion, up to $1,500,000 of such Working Capital Loans may be convertible into warrants of the post-Business Combination entity at a price of $1.50 per warrant. The warrants would be identical to the Private Placement Warrants. As of December 31, 2021 and 2020, the Company had no outstanding borrowings under the Working Capital Loans. F-79 Table of Contents MOTIVE CAPITAL CORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Promissory Note Related Party On October 1, 2020, the Company issued an unsecured promissory note (the Promissory Note ) to the Sponsor, pursuant to which the Company may borrow up to an aggregate principal amount of $300,000. The Promissory Note was non-interest bearing and payable on the earlier of (i) December 31, 2020 and (ii) the completion of the Initial Public Offering. The Company borrowed an aggregate of $130,492 under the Promissory Note. The Promissory Note matured on the closing date of the Initial Public Offering and the outstanding balance under the Promissory Note of $130,492 was repaid in full on December 16, 2020. Subsequent to the repayment, the facility was no longer available to the Company. Administrative Support Agreement The Company entered into an agreement, commencing on December 15, 2020 the effective date of the Initial Public Offering through the earlier of the consummation of a Business Combination or the Company s liquidation, to pay the Sponsor or its affiliate a monthly fee of up to $10,000 for office space, utilities, secretarial and administrative services. As of December 31, 2021, the Company did not incur any fees for the administrative support. The Sponsor has waived such fees and such fees will not be payable until the Sponsor determines that such fees should be paid. Note 6 Commitments and Contingencies Registration Rights Pursuant to a registration and shareholders rights agreement entered into on December 10, 2020, the holders of the Founder Shares, Private Placement Warrants and any warrants that may be issued upon conversion of Working Capital Loans (and any Class A ordinary shares issuable upon the exercise of the Private Placement Warrants and warrants that may be issued upon conversion of the Working Capital Loans) will have registration rights to require the Company to register a sale of any of our securities held by them pursuant to a registration rights agreement. The holders of these securities are entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain piggy-back registration rights with respect to registration statements filed subsequent to the completion of a Business Combination. The registration rights agreement does not contain liquidating damages or other cash settlement provisions resulting from delays in registering the Company s securities. The Company will bear the expenses incurred in connection with the filing of any such registration statements. Underwriting Agreement The Company granted the underwriters a 45-day option from the date of the final prospectus relating to the Initial Public Offering to purchase up to 5,400,000 Units to cover over-allotments, if any, at the Initial Public Offering price less underwriting discounts and commissions. The Over-Allotment was exercised in on closing the Initial Public Offering. The underwriters were entitled to underwriting discounts of $0.35 per unit, or approximately $14,490,000 in the aggregate will be payable to the underwriters for deferred underwriting commissions. The deferred fee will become payable to the underwriters from the amounts held in the Trust Account solely in the event that the Company completes a Business Combination, subject to the terms of the underwriting agreement. Risks and Uncertainties Management continues to evaluate the impact of the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company s financial position, results of its operations and/or search for a target company, the specific impact is not readily determinable as of the date of these consolidated financial statements. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Note 7 Derivative Liabilities As of December 31, 2021 and 2020, the Company had outstanding 13,800,000 Public Warrants, 7,386,667 Private Placement Warrants and a forward purchase agreement, covering up to 14,000,000 forward purchase units. F-80 Table of Contents MOTIVE CAPITAL CORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Warrants Public Warrants may only be exercised for a whole number of shares. No fractional shares will be issued upon exercise of the Public Warrants. The Public Warrants will become exercisable on the later of (a) 30 days after the completion of a Business Combination and (b) one year from the closing of the Initial Public Offering. The Public Warrants will expire five years from the completion of a Business Combination or earlier upon redemption or liquidation. The Company will not be obligated to deliver any Class A ordinary shares pursuant to the exercise of a warrant and will have no obligation to settle such warrant exercise unless a registration statement under the Securities Act with respect to the Class A ordinary shares underlying the warrants is then effective and a prospectus relating thereto is current, subject to the Company satisfying its obligations with respect to registration, or a valid exemption from registration is available. No warrant will be exercisable, and the Company will not be obligated to issue a Class A ordinary share upon exercise of a warrant unless the Class A ordinary share issuable upon such warrant exercise has been registered, qualified or deemed to be exempt under the securities laws of the state of residence of the registered holder of the warrants. The Company has agreed that as soon as practicable, but in no event later than 15 business days, after the closing of a Business Combination, it will use its commercially reasonable efforts to file with the SEC a registration statement for the registration, under the Securities Act, of the Class A ordinary shares issuable upon exercise of the warrants, and the Company will use its commercially reasonable efforts to cause the same to become effective within 60 business days after the closing of a Business Combination, and to maintain the effectiveness of such registration statement and a current prospectus relating to those Class A ordinary shares until the warrants expire or are redeemed, as specified in the warrant agreement; provided that if the Class A ordinary shares are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a covered security under Section 18(b)(1) of the Securities Act, the Company may, at its option, require holders of Public Warrants who exercise their warrants to do so on a cashless basis in accordance with Section 3(a)(9) of the Securities Act and, in the event the Company so elects, the Company will not be required to file or maintain in effect a registration statement, but it will use its commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. If a registration statement covering the Class A ordinary shares issuable upon exercise of the warrants is not effective by the 60th day after the closing of a Business Combination, warrant holders may, until such time as there is an effective registration statement and during any period when the Company will have failed to maintain an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act or another exemption, but the Company will use its commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00. Once the warrants become exercisable, the Company may redeem the outstanding warrants (except as described with respect to the Private Placement Warrants): in whole and not in part; at a price of $0.01 per warrant; upon not less than 30 days prior written notice of redemption to each warrant holder; and if, and only if, the last reported sale price of the Class A ordinary shares for any 20 trading days within a 30-trading day period ending three business days before the Company sends the notice of redemption to the warrant holders (the Reference Value ) equals or exceeds $18.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like). If and when the warrants become redeemable by the Company, the Company may exercise its redemption right even if the Company are unable to register or qualify the underlying securities for sale under all applicable state securities laws. Redemption of warrants when the price per Class A ordinary share equals or exceeds $10.00. Once the warrants became exercisable, the Company may redeem the outstanding warrants: in whole and not in part; F-81 Table of Contents MOTIVE CAPITAL CORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS at $0.10 per warrant upon a minimum of 30 days prior written notice of redemption provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive that number of shares determined based on the redemption date and the fair market value of the Class A ordinary shares; if, and only if, the Reference Value equals or exceeds $10.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like); and if the Reference Value is less than $18.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations, and the like) the Private Placement Warrants must also be concurrently called for redemption on the same terms as the outstanding Public Warrants, as described above. If the Company calls the Public Warrants for redemption, as described above, its management will have the option to require any holder that wishes to exercise the Public Warrants to do so on a cashless basis, as described in the warrant agreement. The exercise price and number of ordinary shares issuable upon exercise of the Public Warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. However, except as described below, the Public Warrants will not be adjusted for issuances of ordinary shares at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the Public Warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of Public Warrants will not receive any of such funds with respect to their Public Warrants, nor will they receive any distribution from the Company s assets held outside of the Trust Account with respect to such Public Warrants. Accordingly, the Public Warrants may expire worthless. In addition, if (x) the Company issues additional Class A ordinary shares or equity-linked securities, excluding the forward purchase securities, for capital raising purposes in connection with the closing of a Business Combination at an issue price or effective issue price of less than $9.20 per Class A ordinary share (with such issue price or effective issue price to be determined in good faith by the Company s board of directors and, in the case of any such issuance to the Sponsor or its affiliates, without taking into account any Founder Shares held by the Sponsor or such affiliates, as applicable, prior to such issuance (the Newly Issued Price ), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of a Business Combination on the date of the consummation of a Business Combination (net of redemptions), and (z) the volume weighted average trading price of its Class A ordinary shares during the 20 trading day period starting on the trading day prior to the day on which the Company consummates its Business Combination (such price, the Market Value ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, the $10.00 and $18.00 per share redemption trigger price will be adjusted (to the nearest cent) to be equal to 100% and 180% of the higher of the Market Value and the Newly Issued Price, respectively. The Private Placement Warrants are identical to the Public Warrants underlying the Units sold in the Initial Public Offering, except that the Private Placement Warrants and the Class A ordinary shares issuable upon the exercise of the Private Placement Warrants will not be transferable, assignable or salable until 30 days after the completion of a Business Combination, subject to certain limited exceptions. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be non-redeemable, except as described above, so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants. Forward Purchase Agreement Concurrent with the execution of the Merger Agreement, the Company entered into the A&R Forward Purchase Agreement. Pursuant to the A&R Forward Purchase Agreement, subject to the fulfillment of certain conditions, the Purchasers will collectively purchase concurrently with the Closing, at a per-unit price of $10.00, 5,000,000 Forward Purchase Units, and up to an additional 9,000,000 Forward Purchase Units to the extent of redemptions on a dollar-for-dollar basis by Company shareholders of all or a portion of their Class A ordinary shares. For the avoidance of doubt, regardless of the extent of such redemptions, the Purchasers will in no event be required to purchase more than an aggregate amount of 14,000,000 Forward Purchase Units. The forward purchase shares included in the Forward Purchase Units will be identical to the Class A ordinary shares included in the Units being sold in the Initial Public Offering, except that they will be subject to transfer restrictions and registration rights. The forward purchase warrants included in the Forward Purchase Units will have the same terms as the public warrants. F-82 Table of Contents MOTIVE CAPITAL CORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 8 Class A Ordinary Shares Subject to Possible Redemption The Company s Class A ordinary shares feature certain redemption rights that are considered to be outside of the Company s control and subject to the occurrence of future events. The Company is authorized to issue 500,000,000 Class A ordinary shares with a par value of $0.0001 per share. Holders of the Company s Class A ordinary shares are entitled to one vote for each share. As of December 31, 2021, and 2020, there were 41,400,000 Class A ordinary shares outstanding, all of which were subject to redemption. The Class A ordinary shares issued in the Initial Public Offering and those issued as part of the Over-Allotment Units were recognized in Class A ordinary shares subject to possible redemption as follows: Gross Proceeds $ 414,000,000 Less: Proceeds allocated to Public Warrants (19,458,000) Class A ordinary shares issuance costs (22,524,192) Plus: Accretion of carrying value to redemption value 41,982,192 Class A ordinary shares subject to possible redemption $ 414,000,000 Note 9 Shareholders Deficit Preference Shares The Company is authorized to issue 5,000,000 preference shares with a par value of $0.0001 per share, with such designations, voting and other rights and preferences as may be determined from time to time by the Company s board of directors. At December 31, 2021 and 2020, there were no preference shares issued or outstanding. Class A Ordinary Shares The Company is authorized to issue 500,000,000 Class A ordinary shares, with a par value of $0.0001 per share. Holders of Class A ordinary shares are entitled to one vote for each share. At December 31, 2021 and 2020, there were 41,400,000 Class A ordinary shares issued and outstanding, all subject to possible redemption and therefore classified as temporary equity on the accompanying balance sheets. See Note 9. Class B Ordinary Shares The Company is authorized to issue 50,000,000 Class B ordinary shares, with a par value of $0.0001 per share. Holders of the Class B ordinary shares are entitled to one vote for each share. On November 24, 2020, the Sponsor surrendered 2,875,000 Founder Shares, which the Company canceled. On November 24 and December 8, 2020, the Sponsor transferred 30,000 founder shares to each of the independent directors. On December 10, 2020, the Company issued a dividend of 1,725,000 Class B ordinary shares, resulting in 10,350,000 Founder Shares outstanding. All share and per-share amounts have been retroactively restated to reflect the share cancellation. At December 31, 2021 and 2020, there were 10,350,000 Class B ordinary shares issued and outstanding. Holders of Class A ordinary shares and Class B ordinary shares will vote together as a single class on all other matters submitted to a vote of shareholders, except as required by law. The Class B ordinary shares will automatically convert into Class A ordinary shares concurrently with or immediately following the consummation of a Business Combination on a one-for-one basis, subject to adjustment. In the case that additional Class A ordinary shares or equity-linked securities are issued or deemed issued in connection with a Business Combination, the number of Class A ordinary shares issuable upon conversion of all Founder Shares will equal, in the aggregate, 20% of the total number of Class A ordinary shares outstanding after such conversion (after giving effect to any redemptions of Class A ordinary shares by public shareholders), including the total number of Class A ordinary shares issued, or deemed issued or issuable upon conversion or exercise of any equity-linked securities or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of a Business Combination, excluding any Class A ordinary shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued, or to be issued, to any seller in a Business Combination and any Private Placement Warrants issued to the Sponsor, officers or directors upon conversion of Working Capital Loans; provided that such conversion of Founder Shares will never occur on a less than one-for-one basis. F-83 Table of Contents MOTIVE CAPITAL CORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 10 Fair Value Measurements A reconciliation of the beginning and ending balances of the derivative liabilities is summarized below: December 31, 2020 - Beginning of Period Warrant Liabilities - Public $ 21,390,000 Warrant Liabilities - Private 11,449,330 Forward Purchase agreement 7,692,950 December 31, 2020 $ 40,532,280 Change in fair value of warrant liabilities - Public (7,314,000) Change in fair value of warrant liabilities - Private (3,914,930) Change in fair value of forward purchase agreement (4,872,950) December 31, 2021 $ 24,430,400 The following tables present information about the Company s financial assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2021 and 2020, by level within the fair value hierarchy: Fair Value Measured as of December 31, 2021 Level 1 Level 2 Level 3 Total Assets: Cash and Investments held in Trust Account $ 414,111,439 $ $ $ 414,111,439 Liabilities: Derivative liabilities - public warrants 14,076,000 14,076,000 Derivative liabilities - private placement warrants 7,534,400 7,534,400 Derivative liabilities - forward purchase agreement 2,820,000 2,820,000 Total liabilities $ 14,076,000 $ 7,534,400 $ 2,820,000 $ 24,430,400 Fair Value Measured as of December 31, 2020 Level 1 Level 2 Level 3 Total Assets: Cash and Investments held in Trust Account $ 414,020,525 $ $ $ 414,020,525 Liabilities: Derivative liabilities - public warrants 21,390,000 21,390,000 Derivative liabilities - private placement warrants 11,449,330 11,449,330 Derivative liabilities - forward purchase agreement 7,692,950 7,692,950 Total liabilities $ $ $ 40,532,280 $ 40,532,280 Transfers to/from Levels 1, 2 and 3 are recognized at the beginning of the reporting period. The estimated fair value of the Public Warrants transferred from a Level 3 measurement to a Level 1 fair value measurement and the estimated fair value of the Private Placement Warrants transferred from a Level 3 measurement to a Level 2 fair value measurement, as a result of the Public Warrants being listed in an active market in February 2021. Prior to the Public Warrants being separately traded in an active market, the fair value of the Public Warrants issued in connection with the Public Offering and the Private Placement Warrants were measured using a binomial lattice model in a risk-neutral framework. The fair value of the forward purchase agreement is based on the fair value of the Company s publicly traded Units on each valuation date, less the present value of the contractually stipulated forward price of $10.00. Beginning in February 2021, the fair value of the Public Warrants are determined based on the listed price in an active market for such warrants and the fair value of the Private Placement Warrants is estimated to be approximately equal to that of the Public Warrants given the low likelihood of the Company s ordinary share price exceeding $18.00 by the start of the exercise period. For the year ended December 31, 2021, the Company recognized a non-operating gain resulting from a decrease in the fair value of derivative liabilities of approximately $16.1 million, which is presented as change in fair value of derivative liabilities in the accompanying consolidated statements of operations. F-84 Table of Contents MOTIVE CAPITAL CORP NOTES TO CONSOLIDATED FINANCIAL STATEMENTS For the period from September 28, 2020 (inception) through December 31, 2020, the Company recognized a non-operating loss resulting from an increase in the fair value of derivative liabilities of approximately $10.7 million, which is presented as change in fair value of derivative liabilities in the accompanying consolidated statements of operations. The estimated fair value of the Private Placement Warrants, Public Warrants and Forward Purchase Agreement, as of December 31, 2021 and 2020 was determined using Level 3 inputs. The Company estimated the volatility of its ordinary share warrants based on implied volatility from historical volatility of select peer company s ordinary shares that matches the expected remaining life of the warrants. The following table provides quantitative information regarding Level 3 fair value measurements inputs as of each measurement date: As of As of December 31, December 31, 2021 2022 Share price, used in warrant valuations $ 10.02 n/a Unit price, used in forward valuation $ 10.54 $ 10.20 Exercise price, warrants $ 11.50 n/a Exercise price, forward $ 10.00 $ 10.00 Term (in years), used in warrant valuations 6.00 n/a Term (in years), used in forward valuation 0.96 0.25 Volatility 21.00 % 15.5 % Risk-free interest rate, used in warrant valuations 0.50 % n/a Risk-free interest rate, used in forward valuation 0.10 % 1.28 % Expected dividends n/a n/a The change in the fair value of the derivative liabilities, classified as Level 3, for the periods ended December 31, 2021 and 2020 is summarized as follows: Level 3 derivative liabilities at December 31, 2020 $ 40,532,280 Transfers from Level 3 (32,839,330) Change in fair value (6,935,120) Level 3 derivative liabilities at March 31, 2021 757,830 Change in fair value (159,200) Level 3 derivative liabilities at June 30, 2021 598,630 Change in fair value 2,201,370 Level 3 derivative liabilities at September 30, 2021 2,800,000 Change in fair value 20,000 Level 3 derivative liabilities at December 31, 2021 $ 2,820,000 Note 11 Subsequent Events The Company evaluated subsequent events and transactions that occurred after the balance sheet date up to the date that the consolidated financial statements were issued. Based upon this review, the Company did not identify any subsequent events that would have required adjustment or disclosure in the consolidated financial statements. F-85 Table of Contents Forge Global Holdings, Inc. 25,853,271 Shares of Common Stock Underlying Warrants 3,005,626 Shares of Common Stock Underlying Assumed Warrants and Former Employee Options 12,053,331 Warrants by the Selling Securityholders 115,289,295 Shares of Common Stock by the Selling Securityholders PROSPECTUS , 2022 Table of Contents PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 13.OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. The following table sets forth the costs and expenses will be paid by us in connection with the issuance and distribution of the securities being registered. We will not receive any proceeds from the sale of shares of common stock or warrants by the Selling Securityholders pursuant to this prospectus, except with respect to amounts received by us upon exercise of the warrants to the extent such warrants are exercised for cash. However, we will pay the expenses, other than underwriting discounts and commissions and certain expenses incurred by the Selling Securityholders in disposing of the securities, associated with the sale of securities pursuant to this prospectus. In addition, we may incur additional expenses in the future in connection with the offering of our securities pursuant to this prospectus. If required, any such additional expenses will be disclosed in a prospectus supplement. All amounts are estimates, except for the SEC registration fee. Amount SEC registration fee $ 180,504 Accounting fees and expenses * Legal fees and expenses * Miscellaneous fees and expenses * Total expenses $ * * These fees will be determined based on the securities offered and the number of issuances and accordingly cannot be defined at this time. ITEM 14.INDEMNIFICATION OF DIRECTORS AND OFFICERS. Section 145(a) of the DGCL provides, in general, that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation), because he or she is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, suit or proceeding, if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. Section 145(b) of the DGCL provides, in general, that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor because the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys fees) actually and reasonably incurred by the person in connection with the defense or settlement of such action or suit if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification shall be made with respect to any claim, issue or matter as to which he or she shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or other adjudicating court determines that, despite the adjudication of liability but in view of all of the circumstances of the case, he or she is fairly and reasonably entitled to indemnity for such expenses that the Court of Chancery or other adjudicating court shall deem proper. Section 145(g) of the DGCL provides, in general, that a corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of his or her status as such, whether or not the corporation would have the power to indemnify the person against such liability under Section 145 of the DGCL. Table of Contents Our Certificate of Incorporation, which became effective upon completion of the Business Combination, provides that no director of ours shall be personally liable to us or our stockholders for monetary damages for any breach of fiduciary duty as a director. In addition, our Certificate of Incorporation provides that if the DGCL is amended to authorize the further elimination or limitation of the liability of directors, then the liability of a director of ours shall be eliminated or limited to the fullest extent permitted by the DGCL, as so amended. Our Certificate of Incorporation further provides that any repeal or modification of such article by its stockholders or amendment to the DGCL will not adversely affect any right or protection existing at the time of such repeal or modification with respect to any acts or omissions occurring before such repeal or modification of a director serving at the time of such repeal or modification. Our Bylaws provide that we will indemnify each person who was or is a party or threatened to be made a party to any threatened, pending or completed action, suit or proceeding whether civil, criminal, administrative or investigative (other than an action by or in the right of the Company) by reason of the fact that he or she is or was, or has agreed to become, the Company s director or officer, or is or was serving, or has agreed to serve, at our request as a director, officer, partner, employee or trustee of, or in a similar capacity with, another corporation, partnership, joint venture or other enterprise (all such persons being referred to as an Indemnitee), or by reason of any action alleged to have been taken or omitted in such capacity, against all expenses (including attorneys fees), judgments, fines, and amounts paid in settlement actually and reasonably incurred in connection with such action, suit or proceeding and any appeal therefrom, if such Indemnitee acted in good faith and in a manner he or she reasonably believed to be in or not opposed to our best interests, and, with respect to any criminal action or proceeding, he or she had no reasonable cause to believe his or her conduct was unlawful. Our Bylaws also provides that we will advance expenses to Indemnitees in connection with a legal proceeding, subject to limited exceptions. In connection with the Business Combination, we entered into indemnification agreements with each of our directors and executive officers. These agreements provide that we will indemnify each of our directors and such officers to the fullest extent permitted by law and our Certificate of Incorporation and our Bylaws. We will also maintain a general liability insurance policy, which will cover certain liabilities of directors and officers of ours arising out of claims based on acts or omissions in their capacities as directors or officers. ITEM 15.RECENT SALES OF UNREGISTERED SECURITIES. On October 2, 2020, we issued an aggregate of 11,500,000 Class B ordinary shares, par value $0.0001 per share, to the Sponsor for an aggregate purchase price of $25,000. On November 24, 2020, the Sponsor surrendered 2,875,000 Founder Shares for no value, and on November 24 and December 8, 2020, the sponsor transferred 30,000 founder shares to each of the then independent directors. Such securities were issued pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act. On December 15, 2020, simultaneous with the consummation of our initial public offering, the Company consummated the private placement of 7,386,667 private placement warrants at a price of $1.50 per private placement warrant, generating total gross proceeds of $11,080. The sale of the private placement warrants was made pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act. On March 21, 2022, immediately after the Domestication, but before the Merger, we (i) sold 6.85 million shares of common stock to certain investors (the PIPE Investors ) pursuant to certain subscription agreements, dated as of September 13, 2021, between Motive, on the one hand, and the PIPE Investors, on the other hand and (ii) issued 14,000,000 Forward Purchase Units, each composed of one share and one-third of one public warrant to certain Motive fund vehicles managed by an affiliate of Motive (the A&R FPA Investors ), pursuant to that certain Amended and Restated Forward Purchase Agreement, dated September 13, 2021, by and among the A&R FPA Investors and Motive. Such securities were issued pursuant to the exemption from registration contained in Section 4(a)(2) of the Securities Act. Table of Contents ITEM 16.Exhibits and Financial Statement Schedules. (a) Exhibits Exhibit Index Exhibit Number Description 2.1*** Merger Agreement, dated as of September 13, 2021, by and among Motive, Merger Sub and Forge Global, Inc. (incorporated by reference to Exhibit 2.1 to the Registrant s Form 8-K filed on September 13, 2021). 3.1 Certificate of Incorporation of Forge Global Holdings, Inc. (incorporated by reference to Exhibit 3.1 to the Registrant s Form 8-K filed on March 25, 2022). 3.2 Bylaws of Forge Global Holdings, Inc. (incorporated by reference to Exhibit 3.3 of the Proxy Statement /Prospectus). 4.1 Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.5 of the Proxy Statement /Prospectus). 4.2 Warrant Agreement, dated December 10, 2020, by and between Motive and Continental Stock Transfer& Trust Company, as warrant agent (incorporated by reference to Exhibit 4.4 of the Proxy Statement /Prospectus). 5.1* Opinion of Goodwin of Goodwin Procter LLP. 10.1 Form of Amended and Restated Registration Rights Agreement, dated as of March 21, 2022, by and among the Company, Sponsor, certain former directors of Motive, and, certain equityholders of the Company named therein (incorporated by reference to Annex G of the Proxy Statement /Prospectus). 10.2 Salesforce Tower Office Lease, dated September 18, 2018 (incorporated by reference to Exhibit 10.2 to the Registrant s Form 8-K filed on March 25, 2022). 10.3# Form of Forge 2022 Stock Option and Incentive Plan (incorporated by reference to Exhibit 10.3 to the Registrant s Form 8-K filed on March 25, 2022). 10.4# Form of Forge 2022 Employee Stock Purchase Plan (incorporated by reference to Exhibit 10.4 to the Registrant s Form 8-K filed on March 25, 2022). 10.5# Amended and Restated Employment Agreement, dated September 9, 2021, by and between Kelly Rodriques and the Company (incorporated by reference to Exhibit 10.9 of the Proxy Statement /Prospectus). 10.6# Amendment No. 1 to Employment Agreement, by and between Kelly Rodriques and Forge Global, Inc.(incorporated by reference to Annex A of the Supplement to the Proxy Statement /Prospectus, filed on March 1, 2022). 10.7# Amended and Restated Employment Agreement, dated September 9, 2021, by and between Mark Lee and Forge Global, Inc. (incorporated by reference to Exhibit 10.10 of the Proxy Statement /Prospectus). 10.8# Amended and Restated Employment Agreement, dated September 9, 2021, by and between Jose Cobos and Forge Global, Inc. (incorporated by reference to Exhibit 10.11 of the Proxy Statement /Prospectus). 10.9# Forge Global, Inc. 2018 Stock Incentive Plan (incorporated by reference to Exhibit 10.9 to the Registrant s Form 8-K filed on March 25, 2022). 10.10# Loan Offset Agreement, dated as of March 21, 2022, by and among Forge Global, Inc. and Kelly Rodriques (incorporated by reference to Exhibit 10.10 to the Registrant s Form 8-K filed on March 25, 2022). 10.11# Loan Offset Agreement, dated as of March 21, 2022, by and among Forge Global, Inc. and Mark Lee (incorporated by reference to Exhibit 10.11 to the Registrant s Form 8-K filed on March 25, 2022). 10.12# Loan Offset Agreement, dated as of March 21, 2022, by and among Forge Global, Inc. and Jose Cobos (incorporated by reference to Exhibit 10.12 to the Registrant s Form 8-K filed on March 25, 2022). Table of Contents 10.13# Form of Director Indemnification Agreement (incorporated by reference to Exhibit 10.13 to the Registrant s Form 8-K filed on March 25, 2022). 10.14# Form of Officer Indemnification Agreement (incorporated by reference to Exhibit 10.14 to the Registrant s Form 8-K filed on March 25, 2022). 10.15 Sponsor Support Agreement, dated as of September 13, 2021 (incorporated by reference to Annex D of the Proxy Statement/Prospectus). 14.1 Code of Ethics and Employee Conduct (incorporated by reference to Exhibit 14.1 to the Registrant s Form 8-K filed on March 25, 2022). 16.1 Letter from WithumSmith+Brown, PC to the U.S. Securities and Exchange Commission dated March 25, 2022. (incorporated by reference to Exhibit 16.1 to the Registrant s Form 8-K filed on March 25, 2022). 21.1 Subsidiaries of the Company (incorporated by reference to Exhibit 21.1 to the Registrant s Form 8-K filed on March 25, 2022). 23.1* Consent of WithumSmith+Brown, PC, independent registered accounting firm for Motive. 23.2* Consent of Ernst & Young LLP, independent registered accounting firm for Forge. 23.3* Consent of Goodwin Procter LLP (included as part of Exhibit 5.1). 24** Power of Attorney (included on signature page to this Registration Statement) 101.INS* Inline XBRL Instance Document 101.SCH* Inline XBRL Taxonomy Extension Schema Document 101.CAL* Inline XBRL Taxonomy Extension Calculation Linkbase Document 101.DEF* Inline XBRL Taxonomy Extension Definition Linkbase Document 101.LAB* Inline XBRL Taxonomy Extension Label Linkbase Document 101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document 104* Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) 107** Filing Fee Table *Filed herewith. ** Previously filed. *** Certain of the exhibits and schedules to this Exhibit have been omitted in accordance with Regulation S-K Item 601(a)(5). The Company agrees to furnish a copy of all omitted exhibits and schedules to the SEC upon its request. # Indicates a management contract or compensatory plan, contract or arrangement. (b) Financial Statement Schedules All schedules have been omitted as not applicable or not required under the rules of Regulation S-X. Table of Contents ITEM 17.Undertakings. The undersigned registrant hereby undertakes: A.To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i)To include any prospectus required by section 10(a)(3) of the Securities Act; (ii)To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the Calculation of Registration Fee table in the effective registration statement. (iii)To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; B.That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. C.To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. D.That, for the purpose of determining liability under the Securities Act to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use. E.Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. Table of Contents SIGNATURES Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in San Francisco, California, on May 19, 2022. FORGE GLOBAL HOLDINGS, INC. By: /s/ Kelly Rodriques Name: Kelly Rodriques Title: Chief Executive Officer Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement on Form S-1 has been signed by the following persons in the capacities and on the dates indicated. Signature Title Date /s/ Kelly Rodriques Chief Executive Officer and Director May 19, 2022 Kelly Rodriques (Principal Executive Officer) /s/ Mark Lee Chief Financial Officer May 19, 2022 Mark Lee (Principal Financial Officer) * Director May 19, 2022 Ashwin Kumar * Director May 19, 2022 Blythe Masters * Director May 19, 2022 Stephen George * Director May 19, 2022 Christoph Hansmeyer * Director May 19, 2022 Kimberly Vogel * Director May 19, 2022 James Herbert, II * Director May 19, 2022 Steven McLaughlin *By: /s/ Kelly Rodriques Kelly Rodriques Attorney-in-Fact
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/FRGT_freight_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/FRGT_freight_prospectus_summary.txt
new file mode 100644
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@@ -0,0 +1,181 @@
+Prospectus Summary Private
+Placements. 
+
+ 
+
+The
+selling shareholders are identified in the table commencing on page 93 . No Ordinary Shares are being registered hereunder
+for sale by us. We will not receive any proceeds from the sale of the Ordinary Shares by the selling shareholders but may receive up
+to $3.6 million from the exercise of Warrants A, C and D, if they are exercised. All net proceeds from the sale of the
+Ordinary Shares covered by this prospectus will go to the selling shareholders. We will receive no cash proceeds from the conversion
+of any of the preferred shares or the exercise of any warrants. See Use of Proceeds. The selling shareholders may sell
+all or a portion of the Ordinary Shares from time to time in market transactions through any market on which our Ordinary Shares are
+then traded, in negotiated transactions or otherwise, and at prices and on terms that will be determined by the then prevailing
+market price or at negotiated prices directly or through a broker or brokers, who may act as agent or as principal or by a
+combination of such methods of sale. See Plan of Distribution. 
+
+ 
+
+Our
+Ordinary Shares are listed on the Nasdaq Capital Market under the symbol FRGT. The last reported sale price of our Ordinary
+Shares on August [ ], 2022 was $[ ] per share.
+
+ 
+
+We
+are an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (or the JOBS Act) and are subject to reduced
+public company reporting requirements.
+
+ 
+
+Investing
+in our securities involves a high degree of risk. See Risk Factors beginning on page 24.
+
+ 
+
+Neither
+the Securities and Exchange Commission (or the SEC) nor any state or other foreign securities commission has approved nor disapproved
+these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
+
+ 
+
+The
+date of this prospectus is , 2022.
+
+ 
+
+Holding
+Foreign Companies Accountable Act
+
+ 
+
+The
+Holding Foreign Companies Accountable Act (the HFCA Act ) was enacted on December 18, 2020. The HFCA Act states if the SEC
+determines that a company has filed audit reports issued by a registered public accounting firm that has not been subject to inspection
+by the PCAOB for three consecutive years beginning in 2021, the SEC shall prohibit the company s shares from being traded on a
+national securities exchange or in the over the counter trading market in the U.S.
+
+ 
+
+On
+March 24, 2021, the SEC adopted interim final rules relating to the implementation of certain disclosure and documentation requirements
+of the HFCA Act. A company will be required to comply with these rules if the SEC identifies it as having a non-inspection 
+year under a process to be subsequently established by the SEC. The SEC is assessing how to implement other requirements of the HFCA
+Act, including the listing and trading prohibition requirements described above.
+
+ 
+
+On
+June 22, 2021, the U.S. Senate passed a bill which, if passed by the U.S. House of Representatives and signed into law, would reduce
+the number of consecutive non-inspection years required for triggering the prohibitions under the HFCA Act from three years to two years.
+
+ 
+
+On
+December 2, 2021, the SEC issued amendments to finalize rules implementing the submission and disclosure requirements in the HFCA Act.
+The rules apply to registrants that the SEC identifies as having filed an annual report with an audit report issued by a registered public
+accounting firm that is located in a foreign jurisdiction and that PCAOB is unable to inspect or investigate completely because of a
+position taken by an authority in foreign jurisdictions.
+
+ 
+
+ 2
+
+ 
+
+ 
+
+ 
+
+On
+December 16, 2021, PCAOB announced the PCAOB HFCA Act determinations (the PCAOB determinations ) relating to the PCAOB s
+inability to inspect or investigate completely registered public accounting firms headquartered in mainland China of the PRC or Hong
+Kong, a Special Administrative Region and dependency of the PRC, because of a position taken by one or more authorities in the PRC or
+Hong Kong.
+
+ 
+
+Our
+previous auditor, Centurion ZD CPA & Co., the independent registered public accounting firm that issued the audit report included
+in this prospectus, as an auditor of companies that are traded publicly in the United States and a firm registered with the PCAOB, is
+subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess Centurion ZD CPA & Co. s
+compliance with applicable professional standards. Centurion ZD CPA & Co. is headquartered in Hong Kong with no branches or offices
+in the United States. As such, Centurion ZD CPA & Co., was identified as a firm subject to the PCAOB s determinations.
+
+ 
+
+On
+June 13, 2022, we dismissed Centurion ZD CPA & Co. and appointed UHY LLP as our new independent public accounting firm. UHY LLP,
+which is headquartered in Michigan, has been inspected by the PCAOB on a regular basis, with the last inspection completed in
+2019, and it is not subject to the determinations announced by the PCAOB on December 16, 2021. If trading in our Ordinary Shares
+is prohibited under the HFCA Act in the future because the PCAOB determines that it cannot inspect or fully investigate our auditor at
+such future time, Nasdaq may determine to delist our Ordinary Shares. If our Ordinary Shares are unable to be listed on another securities
+exchange by then, such a delisting would substantially impair your ability to sell or purchase our Ordinary Shares when you wish to do
+so, and the risk and uncertainty associated with a potential delisting would have a negative impact on the price of our Ordinary Shares.
+
+ 
+
+See
+ Risk Factors Risks Related to our Ordinary Shares - Our shares may be delisted under the Holding Foreign Companies Accountable
+Act if the PCAOB is unable to inspect our auditors for three consecutive years beginning in 2021. If the bill passed by the U.S. Senate
+on June 22, 2021 is passed by the U.S. House of Representatives and signed into law, this would reduce the number of consecutive non-inspection
+years required for triggering the prohibitions under the Holding Foreign Companies Accountable from three years to two. The delisting
+of our shares, or the threat of their being delisted, may materially and adversely affect the value of your investment. 
+
+ 
+
+The
+recent joint statement by the SEC and PCAOB, proposed rule changes submitted by Nasdaq, and the Holding Foreign Companies Accountable
+Act all call for additional and more stringent criteria to be applied to emerging market companies upon assessing the qualification of
+their auditors, especially the non-U.S. auditors who are not inspected by the PCAOB. These developments could add uncertainties to our
+securities. Such risks include but not limited to that trading in our securities may be prohibited under the HFCA Act and as a result
+an exchange may determine to delist our securities.
+
+ 
+
+We
+cannot assure you whether Nasdaq or regulatory authorities would apply additional and more stringent criteria to us after considering
+the effectiveness of our auditor s audit procedures and quality control procedures, adequacy of personnel and training, or sufficiency
+of resources, geographic reach or experience as it relates to the audit of our financial statements. It remains unclear what the SEC s
+implementation process related to the March 2021 interim final amendments will entail or what further actions the SEC, the PCAOB or Nasdaq
+will take to address these issues and what impact those actions will have on U.S. companies that have significant operations in the PRC
+and have securities listed on a U.S. stock exchange (including a national securities exchange or over-the-counter stock market). In addition,
+the March 2021 interim final amendments and any additional actions, proceedings, or new rules resulting from these efforts to increase
+U.S. regulatory access to audit information could create some uncertainty for investors, the market price of our Ordinary Shares could
+be adversely affected, trading in our securities may be prohibited and we could be delisted if we and our auditor are unable to meet
+the PCAOB inspection requirement or being required to engage a new audit firm, which would require significant expense and management
+time.
+
+ 
+
+See
+ Risk Factors NASDAQ may apply additional and more stringent criteria for our continued listing. 
+
+ 
+
+Neither
+the Securities and Exchange Commission nor any state securities commission nor any other regulatory body has approved or disapproved
+of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
+
+ 
+
+This
+prospectus does not constitute, and there will not be, an offering of securities to the public in the British Virgin Islands.
+
+ 
+
+The
+date of this prospectus is _____________, 2022.
+
+ 
+
+ 3
+
+ 
+
+ 
+
+ 
+
+TABLE
+OF CONTENTS
\ No newline at end of file
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+summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under the section of this prospectus entitled "Risk Factors" and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, or the context otherwise requires, references to: "common stock" are to our Class A common stock and our Class B common stock, collectively; "founder shares" are to shares of our Class B common stock initially purchased by our sponsor in a private placement prior to this offering, and the shares of our Class A common stock issuable upon the conversion thereof as provided herein; "initial stockholders" are to our sponsor and any other holders of our founder shares prior to this offering (or their permitted transferees); "management" or our "management team" are to our officers and directors; "placement units" are to the units being purchased separately by our sponsor in the private placement, each placement unit consisting of one placement share and one placement warrant and to any units issued upon conversion of working capital loans; "placement shares" are to the shares of our common stock included within the placement units being purchased separately by our sponsor in the private placement and to the shares included in any units issued upon conversion of working capital loans; "placement warrants" are to the warrants included within the placement units being purchased separately by our sponsor in the private placement and to the warrants included in any units issued upon conversion of working capital loans; "private placement" are to the private placement of 467,575 units (or up to 520,075 units depending on the extent to which the underwriter s over-allotment option is exercised) being purchased by our sponsor which will occur simultaneously with the completion of this offering at a purchase price of $10.00 per unit for a total purchase price of $4,675,750 (or up to $5,200,750 if the underwriter s over-allotment option is exercised in full); "public shares" are to shares of our Class A common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); "public stockholders" are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder s and member of our management team s status as a "public stockholder" shall only exist with respect to such public shares; "public warrants" are to our redeemable warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market, including warrants that may be acquired by our sponsor or its affiliates in this offering or thereafter in the open market); "representative" are to EF Hutton, division of Benchmark Investments, LLC who is the representative of the underwriters in this offering; "representative shares" refers to the 100,000 shares of Class A common stock (115,000 if the over-allotment option is exercised in full) to be issued as compensation to the representative and/or its designees; "sponsor" are to FutureTech Partners II LLC, a Delaware limited liability company, which is an affiliate of certain of our officers and directors; "warrants" are to our redeemable warrants, which includes the public warrants and the placement warrants; and "we," "us," "company" or "our company" are to FutureTech II Acquisition Corp. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. 1 Table of Contents Our Company We are a newly organized, blank check company formed on August 19, 2021 as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. To date, our efforts have been limited to organizational activities as well as activities related to this offering. We have generated no operating revenues to date and do not expect to generate any operating revenues until after we consummate our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated or engaged in any substantive discussions, directly or indirectly, with any business combination target. Our efforts to identify a prospective target business will not be limited to a particular industry or geographic location, although we currently intend to focus on opportunities to acquire U.S. companies in the disruptive technology sector, for example, artificial intelligence, or AI, robotic process automation, or Robotics, and any other related technology innovations market. We shall not undertake our initial business combination with any entity with its principal business operations in China (including Hong Kong and Macau). While we may pursue an acquisition opportunity in any business industry or sector, we intend to capitalize on our management team s differentiated ability to source, acquire and manage a business in the technology industry. Our management team has an extensive track record of creating value for stockholders by acquiring strong businesses at disciplined valuations, investing in growth while fostering financial discipline and ultimately improving financial results. Management Team Our management team is led by Yuquan Wang, our Chief Executive Officer and Chairman of the Board, Michael Greenall, our Chief Financial Officer, and Neil Bush, Aroop Zutshi and Jeffrey Mosley, our independent director nominees. Yuquan Wang is a New York based investor in hardware-based technologies. Mr. Wang is the Founding Partner of Haiyin Capital, a venture capital fund formed in 2008 that focuses on investing in new technologies around the world. To date, Haiyin Capital has invested in hardware-based technology companies around the world, with AI and Robotics as key fields of investment. Haiyin Capital s portfolio companies include Hanson Robotics, an AI and Robotics company dedicated to creating socially intelligent, human-like machines that enrich the quality of human lives; Soft Robotics, a company that designs and builds automated hand-like devices using proprietary soft robotic grippers and AI to solve problems related to grasping items in industries such as food processing, consumer goods production, and logistics. Prior to being an investor, Mr. Wang had 20 years of experience in the field of consulting and was the founder, first Chairman and Chief Advisor of Frost & Sullivan (China branch). Additionally, Mr. Wang is a frequent speaker on topics such as trends in technology and is featured on the Dedao Platform (a provider of online education courses in China) and Toutiao (among the leading news apps in China over the past several years). Mr. Wang has published articles on global technology trends and since 2017 has branded an annual 4-hour technology review show "Mapping Global Innovation"; annually, the review show has attracted on-site attendees and a large online following. Mr. Wang has written four books on global innovation: Modularized Innovation, The Invisible Trends, Industry Insights Handbook and The Indispensable China, which was Mr. Wang s latest book (the titles of these works are approximate translations). Mr. Wang believes cross-border cooperation is crucial for the future global innovation, and therefore founded Innovation Map in 2016, a company that facilitates cross-boundary business and cultural communication especially between United States and China. Mr. Wang currently serves as an advisor to the George H.W. Bush Foundation for U.S.-China Relations. Mr. Wang earned his bachelor s degree in Biology from Beijing Normal University. Michael Greenall has over 33 years of experience in the investment banking and fund management industries, including managing equity research teams, equity and fund sales, private banking and fund management specializing in long and short strategies. Mr. Greenall has advised family offices on investments and trading in the equity markets since 2021. He is also the founder and director of Kairo Villa, a boutique resort hotel in Malaysia. From 2018 to 2020, Mr. Greenall was the Chief Executive Officer and Managing Director of Value Partners Asset Management Malaysia ("VPMY"), as head of its Southeast Asian Business in charge of distributing China and PE funds. VPMY is a wholly owned subsidiary of the Hong Kong-listed Value Partners Group. Between 2016 and 2018, Mr. Greenall was the Managing Director and Regional Head of Research and the Association of Southeast Asian Nations ("ASEAN") strategist at the Kuala Lumpur-based CIMB Securities. In that role, he ran the research teams in 10 countries and areas (Malaysia, Singapore, Thailand, Indonesia, Vietnam, South Korea, India, Mainland China, Hong Kong and Taiwan). Between 2006 and 2014, Mr. Greenall served as in various capacities as Managing Director, Head of Malaysia Equity, Head of Research for BNP Paribas Malaysia and Singapore. Between 1989 and 2006, Mr. Greenall served analyst/Head of Research positions in Zalik Securities, Baring Securities, CLSA, Caspian and BNP Prime Peregrine. As an equity research analyst, he has covered many sectors, with an emphasis on telecommunications, commodities, consumer, goods, gaming and airlines. He has analyzed companies listed in equity markets of China, Hong Kong, Malaysia, Singapore, Indonesia, Thailand and the Philippines. In 1988, Mr. Greenall received his bachelor s degree in science, majoring in Agribusiness from the Agricultural University of Malaysia. Neil Bush has been involved with international business development for four decades operating as CEO of Neil Bush Global Advisers LLC. For the past twenty-five years Mr. Bush has engaged in various business development activities in Asia and the Middle East. He currently serves as Chairman of Singhaiyi, a Singapore listed real estate company investing in the United States and acts as Co-Chairman of CIIC, a Beijing based real estate development company. Additionally, Mr. Bush works with CP Group in helping them invest in the United States and is founder and Chairman of A&A Consultants, which is directing investment capital into U.S. projects and performing cross border services. Mr. Bush also serves on the Board of Directors of Hong Kong Finance Investment Holding Group, a Hong Kong listed company with global finance and real estate interests. Over the years, Mr. Bush has introduced American and European companies to the Asian market in real estate development, automobile parts, sheet rock manufacturing, paint production, renewable storage systems, and HIV testing. He has been involved with investments from Asia and the Middle East into American companies in real estate, fertility clinics, and education. Mr. Bush graduated from Tulane University with a bachelor s degree in International Economics and from the Tulane University Freeman School of Business with a master s in business administration. He serves as the Chairman of the Points of Light, Chairman of the Bush School of Government and Public Service, and he and his wife, Maria Bush, chair the Barbara Bush Celebration of Reading and the Barbara Bush Houston Literacy Foundation. Aroop Zutshi is the Global Managing Partner and Executive Board Member for Frost & Sullivan, a business consulting firm focused on market research and analysis, growth strategy consulting, and corporate training. In his current position, effective January 2020, he is focused on upgrading the company transformation framework for Frost & Sullivan in the areas of product, sales, digital, analytics and customer experience. Prior to his position as Global Managing Partner, Mr. Zutshi was the Global President and Managing Partner and involved in overseeing the day-to-day operations of Frost & Sullivan from August 1990 to December 2019. Mr. Zutshi has been responsible for global company performance, corporate vision, strategy, products and building client relationships. Mr. Zutshi s responsibilities included driving company growth on a global basis, and he has built a global presence of Frost & Sullivan in more than thirty-six countries worldwide across the Americas, Asia, Europe and Africa. Mr. Zutshi is a public speaker and has spoken at many industry events and Growth Innovation and Leadership events. Very recently Mr. Zutshi has authored a book entitled The Great Lockdown. Mr. Zutshi has supported his alma mater and is currently on the Board of BIT Mesra, Ranchi, India, Mr. Zutshi is also the President of his alumni group in Silicon Valley and also Member of the Board of the alumni s global entity. Mr. Zutshi also serves as a Director of Frost and Sullivan Institute a Non-Profit focused on innovating global challenges to zero. Jeffrey Moseley is a consultant to clients with interests in trade, economic development and transportation through his company, Moseley Advisors. Most recently Mr. Moseley served as President and CEO of the Texas Association of Business (TAB). TAB is the State Chamber of Commerce with more than 200 statewide chamber partners. Prior to his role at TAB, Mr. Moseley served as State Vice President of Government Affairs of Texas Central Partners LLC, a private company developing a $25 billion high-speed rail system between Houston and Dallas/Fort Worth. Former Texas Governor Rick Perry appointed Mr. Moseley to the Texas Department of Transportation (TxDOT) Commission. Before TxDOT, Mr. Moseley served as President/CEO of Texas largest chamber of commerce, the Greater Houston Partnership (GHP). Under former Texas governors, George W. Bush and Rick Perry, Mr. Moseley was appointed Executive Director and CEO of economic development for the State of Texas. During his six years heading the agency, Mr. Moseley led teams in a range of site selection projects including Toyota s Tundra Assembly Plant. Mr. Moseley was elected Denton County Judge for three terms where he served in office for more than twelve years. While Denton County Judge, Mr. Moseley initiated the I-35 Corridor Coalition, a multi-state, bipartisan, urban-rural advocacy group. The Coalition grew to include Oklahoma, Kansas, Iowa, Minnesota, Michigan as well as international memberships from Canada and Mexico becoming North America s Superhighway Coalition (NASCO). Mr. Moseley was named an Outstanding Alumnus of Southern Nazarene University. 2 Table of Contents Past experience or performance of our management team, including our directors and director nominees, is not a guarantee of either (i) our ability to successfully identify and execute a transaction or (ii) success with respect to any business combination that we may consummate. You should not rely on the historical record of our management team, directors, or director nominees as indicative of future performance. See "Risk Factors — Past performance by members of our management team or their respective affiliates may not be indicative of future performance of an investment in us." For a complete list of our executive officers and entities for which a conflict of interest may or does exist between such officers and the company, please refer to "Management — Conflicts of Interest." Business Strategy We believe that the Artificial Intelligence ("AI") and Robotics sectors are evolving quickly and will experience substantial growth in the coming years. AI and Robotics have the potential to improve social productivity, bring disruptive changes to human life, safer work, more affordable products and services, smarter and more human-friendly infrastructures, new markets and more emerging employment opportunities. AI and Robotics are becoming fully commercialized and bring profound changes to all industries. The opportunity for technology companies serving these needs has never been greater, and we believe this trend will continue to generate significant value on a global scale. Artificial Intelligence We believe that we are living in a digital era where AI is poised to reshape our lives. The continuous research and innovation directed by the tech giants are driving the adoption of advanced AI technologies in industry verticals, such as automotive, healthcare, retail, finance, and manufacturing. The global artificial intelligence (AI) software market is forecast to grow rapidly in the coming years and reach approximately $126 billion by 2025. We believe the development of AI will facilitate growth in a variety of industries such as auto driving, smart city, the Internet of things ("IoT") and Robotics. The investment in AI is also growing rapidly. According to IDC, global investment in AI is projected to grow from approximately $50.1 billion in 2020 to over approximately $110.0 billion in 2024. The global AI market reached a value of approximately $40.21 billion in 2020. The AI market is projected to experience strong growth during the next five years, growing by approximately $76.44 billion, representing a CAGR of approximately 21% during the forecast period of 2021 – 2025. North America is expected to represent approximately 56% of the worldwide market s overall growth. Robotics The global market for robots is expected to grow at a compound annual growth rate (CAGR) of approximately 26 percent to reach just under $210 billion by 2025. Robotics investments boomed during the COVID-19 pandemic. From March 2020 to March 2021, venture firms invested approximately $6.3 billion into Robotics companies, an increase of nearly 50% from the $4.3 billion that such firms invested during the prior 12-month period, according to an analysis by venture-capital database PitchBook for Forbes. Industrial Robotics firms, which serve factories and warehouses, accounted for approximately $1.9 billion of such funding, a 90% increase from the approximately $1.0 billion raised for the prior year, according to PitchBook for Forbes which represents nearly one-third of total venture investment in that period, demonstrating the increased interest from venture investors in industrial innovation. The commercial Robotics market was valued at $10.91 billion in 2020, and it is expected to reach a value of $58.56 billion by 2026, at a CAGR of 33.21%, during the forecast period (2021 - 2026). According to Mordor Intelligence, commercial robots are widely used in the field, as autonomous guided, drones, and in medical applications due to robots exceptional service as compared to traditional methods. Moreover, Mordor Intelligence notes that the medical Robotics sector has developed at a rapid rate, as the healthcare industry strongly generally favors innovation and the IoT industry and investments in Robotics have been the major contributors to the growth of this market. 3 Table of Contents Competitive Advantages We intend to capitalize on the following competitive advantages in our pursuit of a target company: Our management team s experience in identifying in technology companies with significant growth potential Our management team is led by Mr. Yuquan Wang, who has over 20 years experience in the technology sector with expertise in the technology industry life cycle and competition patterns. We have unique manufacturing and market readiness analysis tools that guide us in identifying companies at earlier stages and focusing on the next big trend for mass market extension. Our search for an initial business combination target will be focused on cutting-edge technologies, including but not limited to the AI and Robotics. Through more than a decade of observation and venture capital investments by our management team, we believe that these disruptive technology fields will create companies with breakthrough impacts on traditional industries, as well as on human lives in the near future. We have also engaged individuals to serve as our independent directors with extensive experience in international marketplaces, expertise in electronical engineering and foreign affairs oversight. Our directors also have experience in developing corporate strategy and implementation and identification of new and advancing technologies, which we believe will significantly benefit us as we evaluate potential acquisition or merger candidates as well as following the completion of our initial business combination. M&A and investing experience Our management have gained extensive experience in evaluating core competitiveness, business model and growth strategy of technology companies. Our team members have been active in identifying and investing, at earlier stages, in companies focused on the next big trends, such as AI and Robotics. Strong Financial Position and Flexibility With the funds held in our trust account, we can offer a target business a variety of options to facilitate a business combination and fund future expansion and growth of its business. Because we are able to consummate a business combination using the cash proceeds from this offering, our share capital, debt or a combination of the foregoing, we have the flexibility to use an efficient structure allowing us to tailor the consideration to be paid to the target business to address the needs of the parties. Execution and structuring capability We believe our structure will make us an attractive business combination partner to prospective target businesses. As a publicly listed company, we will offer a target business an alternative to the traditional initial public offering. We believe that target businesses will favor this alternative, which we believe is less expensive, while offering greater certainty of execution than the traditional initial public offering. During an initial public offering, there are typically expenses incurred in marketing, which would be costlier than a business combination with us. Furthermore, once a proposed business combination is approved by our stockholders (if applicable) and the transaction is consummated, the target business will effectively become a publicly listed company, whereas an initial public offering is always subject to the underwriters ability to complete the offering, as well as general market conditions that could prevent the offering from occurring. Once publicly traded, we believe the target business would have greater access to capital and additional means of creating management incentives that are better aligned with stockholders interests than it would as a private company. It can offer further benefits by augmenting a company s profile among potential new customers and vendors and aid in attracting talented management staffs. Acquisition Criteria The focus of our management team to create stockholder value by leveraging its experience to improve the efficiency of the business, while implementing strategies to grow revenue and profits organically and/or through acquisitions. Consistent with our strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. While we intend to use these criteria and guidelines in evaluating prospective businesses, we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. We intend to seek to acquire one or more companies that we believe have: Market trend and focus We will focus on hardware technology companies that have large market potentials, mainly in areas of AI and Robotics. 4 Table of Contents Based on the factors discussed elsewhere in this prospectus, robots are becoming the underlying operating system of our society. Integrated with AI, robots can perform complex tasks that require rich human experience. Various types of robots have been introduced into the market, such as cleaning robots, hotel service robots, logistics robots, cruising robots, cooking robots and human-like social robots. These robots are gradually being integrated into our daily lives and we believe that they will likely be significantly further popularized in the future. Opportunity for operational improvements We will seek to identify businesses that we believe are stable but at an inflection point and would benefit from our ability to drive improvements in the target s processes, go-to market strategy, product or service offering, sales and marketing efforts, geographical presence and/or leadership team. Leading industry position and competitive market advantage We will seek to acquire a business whose products utilize a proprietary or patented technology, have a significant market position in a specific geographic or technological niche, or have a significant market position in a specific geographic or technological niche, or have some other form of distinct competitive advantage. The factors we intend to consider include management s credentials, growth prospects, competitive dynamics, level of industry consolidation, need for capital investment, intellectual property, barriers to entry, and merger terms. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation materials or tender offer documents that we would file with the SEC. In addition to any potential business candidates we may identify on our own, we anticipate that other target business candidates will be brought to our attention from various unaffiliated sources, including investment market participants, private equity funds and large business enterprises seeking to divest non-core assets or divisions. Initial Business Combination So long as our securities are then listed on the Nasdaq, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the net assets held in the trust account (less the deferred underwriting commissions and income taxes payable on the interest and other income earned on the trust account) at the time of signing a definitive agreement in connection with our initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or an independent valuation or appraisal firm with respect to the satisfaction of such criteria. While we consider it unlikely that our board will not be able to make an independent determination of the fair market value of a target business or businesses, it may be unable to do so if the board is less familiar or experienced with the target company s business, there is a significant amount of uncertainty as to the value of the company s assets or prospects, including if such company is at an early stage of development, operations or growth, or if the anticipated transaction involves a complex financial analysis or other specialized skills and the board determines that outside expertise would be helpful or necessary in conducting such analysis. Since any opinion, if obtained, would merely state that the fair market value of the target business meets the 80% of net assets threshold, unless such opinion includes material information regarding the valuation of a target business or the consideration to be provided, it is not anticipated that copies of such opinion would be distributed to our shareholders. However, if required under applicable law, any proxy statement that we deliver to shareholders and file with the SEC in connection with a proposed transaction will include such opinion. We anticipate structuring our initial business combination so that the post-business combination company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-business combination company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-business combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-business combination company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-business combination company, depending on valuations ascribed to the target and us in the business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-business combination company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. In addition, we have agreed not to enter into a definitive agreement regarding an initial business combination without the prior consent of our sponsor. If our securities are not then listed on the Nasdaq for whatever reason, we would no longer be required to meet the foregoing 80% of net assets test. 5 Table of Contents To the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors. The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the funds we can use to complete another business combination. Corporate Information Our executive offices are located at 128 Gail Drive, New Rochelle, NY 10805, and our telephone number is (914) 316-4805. We are an "emerging growth company," as defined in Section 2(a) of the Securities Act of 1933, as amended (the "Securities Act"), as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A common stock that is held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a "smaller reporting company" as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our shares held by non-affiliates exceeds $250 million as of the prior June 30, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our shares held by non-affiliates exceeds $700 million as of the prior June 30. 6 Table of Contents THE OFFERING In deciding whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Please see "Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419." You should carefully consider these and the other risks set forth in the section of this prospectus entitled "Risk Factors." Securities offered 10,000,000 units, at $10.00 per unit, each unit consisting of: one share of Class A common stock; and one redeemable warrant. Proposed Nasdaq symbols Units: "FTIIU" Class A Common Stock: "FTII" Warrants: "FTIIW" Trading commencement and separation of Class A common stock and warrants The units are expected to begin trading on or promptly after the date of this prospectus. We expect the Class A common stock and warrants comprising the units to begin separate trading on the 52nd day following the date of this prospectus (or if such date is not a business day, the following business day) unless EF Hutton, the representative of the underwriters, informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the shares of Class A common stock and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into shares of Class A common stock and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Additionally, following our initial business combination, the units will automatically separate into their component parts and will not be traded thereafter. Separate trading of the Class A common stock and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A common stock and warrants be traded separately until we have filed a Current Report on Form 8-K with the SEC containing an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which closing is anticipated to take place two business days from the date of this prospectus. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to reflect the exercise of the underwriters over-allotment option. Units: Number outstanding before this offering and the private placement 0 Number outstanding after this offering and the private placement 10,467,575(1) 7 Table of Contents Common stock: Number outstanding before this offering and the private placement 2,875,000 shares of Class B common stock(2) Number outstanding after this offering and the private placement 13,067,575 shares of Class A common stock and Class B common stock(1)(3) Redeemable Warrants: Number outstanding before this offering and the private placement 0 Number of warrants to be outstanding after this offering and the private placement 10,467,575(1) (1) Assumes no exercise of the underwriters over-allotment option and the forfeiture by our sponsor of 375,000 founder shares. Our sponsor has agreed to purchase an aggregate of 467,575 units (or up to 520,075 units depending on the extent to which the underwriters over-allotment option is exercised) at a purchase price of $10.00 per unit for a total purchase price of $4,675,750 (or up to $5,200,750 if the underwriter s over-allotment option is exercised in full). Each placement unit will be identical to the units sold in this offering, except as described in this prospectus. The placement units are not subject to forfeiture but will be subject to transfer restrictions as described in "Principal Stockholders — Transfers of Founder Shares and Placement Units (including securities contained therein)"). (2) Includes up to 375,000 shares that are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised. (3) Comprised of 10,000,000 shares of Class A common stock, 2,500,000 shares of Class B common stock (or founder shares) and 467,575 private placement shares. The Class B common stock is convertible into shares of our Class A common stock on a one-for-one basis, subject to adjustment as described below adjacent to the caption "Founder shares conversion and anti-dilution rights." Exercisability Each whole warrant is exercisable to purchase one share of our Class A common stock and only whole warrants are exercisable. We structured each unit to contain one redeemable warrant, with each whole warrant exercisable for one share of Class A common stock. Many special purpose acquisition companies issue units which contain less than one whole warrant which would decrease the dilutive effect of their warrants relative to our structure. This may make us less attractive initial business combination partner for target businesses. Exercise price $11.50 per share, subject to adjustment as described herein. In addition, if (x) we issue additional shares of Class A common stock or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per share of Class A common stock (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares or placement units (or securities underlying such placement units) held by our sponsor or such affiliates, as applicable, prior to such issuance) (the "Newly Issued Price"), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our common stock during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the "Market Value") is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the greater of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price described below under "Redemption of warrants" will be adjusted (to the nearest cent) to be equal to 180% of the greater of the Market Value and the Newly Issued Price. 8 Table of Contents The warrants will become exercisable 30 days after the completion of our initial business combination, provided that we have an effective registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise of the warrants and a current prospectus relating to them is available (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. Exercise period We are registering the shares of Class A common stock issuable upon exercise of the warrants in the registration statement of which this prospectus forms a part at this time because the warrants will become exercisable 30 days after the completion of our initial business combination, which may be within one year of this offering. However, because the warrants will be exercisable until their expiration date of up to five years after the completion of our initial business combination, in order to comply with the requirements of Section 10(a)(3) of the Securities Act following the consummation of our initial business combination, we have agreed that as soon as practicable, but in no event later than 20 business days after the closing of our initial business combination, we will use our commercially reasonable efforts to file with the SEC a post-effective amendment to this registration statement or a new registration statement, under the Securities Act, covering the shares of Class A common stock issuable upon exercise of the warrants, and we will use our commercially reasonable efforts to cause the same to become effective within 60 business days after the closing of our initial business combination, and to maintain the effectiveness of such registration statement and a current prospectus relating to those shares of Class A common stock until the warrants expire or are redeemed, as specified in the warrant agreement; provided that if our shares of Class A common stock are at the time of any exercise of a warrant not listed on a national securities exchange such that they satisfy the definition of a "covered security" under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of warrants who exercise their warrants to do so on a "cashless basis" in accordance with Section 3(a)(9) of the Securities Act and, in the event we so elect, we will not be required to file or maintain in effect a registration statement. If a registration statement covering the shares of Class A common stock issuable upon exercise of the warrants is not effective by the 60th business day after the closing of the initial business combination, warrant holders may, until such time as there is an effective registration statement and during any period when we will have failed to maintain an effective registration statement, exercise warrants on a "cashless basis" in accordance with Section 3(a)(9) of the Securities Act or another exemption, but we will use our commercially reasonable efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption is not available. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. 9 Table of Contents Redemption of warrants Once the warrants become exercisable, we may redeem the outstanding warrants: in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption given after the warrants become exercisable, which we refer to as the 30-day redemption period; and if, and only if, the last sale price of our Class A common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period commencing once the warrants become exercisable and ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. We will not redeem the warrants unless a registration statement under the Securities Act covering the shares of Class A common stock issuable upon exercise of the warrants is effective and a current prospectus relating to those shares of Class A common stock is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may not exercise our redemption right if the issuance of shares of common stock upon exercise of the warrants is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect such registration or qualification. We will use our best efforts to register or qualify such shares of common stock under the Blue Sky laws of the state of residence in those states in which the warrants were offered by us in this offering. If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a "cashless basis." In determining whether to require all holders to exercise their warrants on a "cashless basis," our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our stockholders of issuing the maximum number of shares of Class A common stock issuable upon the exercise of our warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of shares of Class A common stock equal to the quotient obtained by dividing (x) the product of the number of shares of Class A common stock underlying the warrants, multiplied by the difference between the exercise price of the warrants and the "fair market value" (defined below) by (y) the fair market value. The "fair market value" shall mean the average reported last sale price of the Class A common stock for the 10 trading days ending on the third trading day prior to the date on which the notice of redemption is sent to the holders of warrants. Please see the section of this prospectus entitled "Description of Securities — Redeemable Warrants — Public Stockholders Warrants" for additional information. 10 Table of Contents Founder shares On October 8, 2021, our sponsor purchased 2,875,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.009 per share. (up to 375,000 shares of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised). Prior to the consummation of this offering, our sponsor plans to transfer 20,000 founder shares to our Chief Financial Officer, 10,000 founder shares to each of our three independent directors. Prior to the initial investment in the company of $25,000 by our sponsor, the Company had no assets, tangible or intangible. The per share purchase price of the founder shares was determined by dividing the amount of cash contributed to the company by the aggregate number of founder shares issued. The number of founder shares issued was determined based on the expectation that the founder shares would represent 20% of the outstanding shares after this offering (excluding the placement units and underlying securities). As such, our initial stockholders will collectively own approximately 22.7% of our issued and outstanding shares after this offering (including the placement shares to be issued to our sponsor and assuming they do not purchase any units in this offering). Neither our sponsor nor any of our officers or directors have expressed an intention to purchase any units in the offering. Up to 375,000 founder shares will be subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised so that our initial stockholders will maintain ownership of 20% of our common stock after this offering (excluding the placement units and underlying securities). We will effect a stock dividend or share contribution prior to this offering should the size of the offering change, in order to maintain such ownership percentage. The founder shares are identical to the shares of Class A common stock included in the units being sold in this offering, except that: the founder shares are shares of Class B common stock that automatically convert into shares of our Class A common stock at the time of the closing of our initial business combination, on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described herein; the founder shares are subject to certain transfer restrictions, as described in more detail below; our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have each agreed to (i) waive their redemption rights with respect to any founder shares, placement shares and public shares held by them in connection with the completion of our initial business combination, (ii) waive their redemption rights with respect to any founder shares, placement shares and public shares held by them in connection with a stockholder vote to approve an amendment to our amended and restated certificate of incorporation (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within twelve (12) months from the closing of this offering (or up to eighteen (18) months from the closing of this offering if we extend the period of time to consummate a business combination in full, as described in more detail in this prospectus) or (B) with respect to any other provision relating to stockholders rights or pre-initial business combination activity and (iii) waive their rights to liquidating distributions from the trust account with respect to any founder shares and placement shares held by them if we fail to complete our initial business combination within twelve (12) months from the closing of this offering (or up to eighteen (18) months from the closing of this offering if we extend the period of time to consummate a business combination in full, as described in more detail in this prospectus), although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame. 11 Table of Contents pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote any founder shares and placement shares held by them and any public shares acquired by them during or after this offering (including in open market and privately negotiated transactions or otherwise) in favor of our initial business combination. If we submit our initial business combination to our public stockholders for a vote, unless otherwise required by applicable law, regulation or stock exchange rules, we will complete our initial business combination only if a majority of the outstanding shares of common stock present and entitled to vote at the meeting of stockholders to approve the initial business combination are voted in favor of the initial business combination. As a result, in addition to our initial stockholders founder shares and placement shares, we would need only 3,466,215, or approximately 34.66%, of the 10,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming the over-allotment option is not exercised, that the initial stockholders do not purchase any units in this offering or units or shares in the after-market, and that the representative shares are voted in favor of such initial business combination). In the event that all shares of our outstanding common stock are voted, we would need 199,320 or 1.99%, of the 10,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming the over-allotment option is not exercised, that the initial stockholders do not purchase any units in this offering or units or shares in the after-market, and that the representative shares are voted in favor of such initial business combination); and the founder shares are entitled to registration rights. Transfer restrictions on founder shares Our initial stockholders have agreed not to transfer, assign or sell any of their founder shares until the earlier to occur of: (A) one year after the completion of our initial business combination or (B) subsequent to our initial business combination, (x) if the last sale price of our Class A common stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least six months after our initial business combination, or (y) the date on which we complete a liquidation, merger, capital stock exchange or other similar transaction that results in all of our stockholders having the right to exchange their shares of common stock for cash, securities or other property (except as described herein under the section of this prospectus entitled "Principal Stockholders — Restrictions on Transfers of Founder Shares and Placement Units"). Any permitted transferees will be subject to the same restrictions and other agreements of our initial stockholders with respect to any founder shares. We refer to such transfer restrictions throughout this prospectus as the lock-up. 12 Table of Contents Founder shares conversion and anti-dilution rights The shares of Class B common stock will automatically convert into shares of our Class A common stock in connection with the closing of our initial business combination on a one-for-one basis, subject to adjustment for stock splits, stock dividends, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein. In the case that additional shares of Class A common stock, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in this prospectus and related to the closing of the initial business combination, the ratio at which shares of Class B common stock shall convert into shares of Class A common stock will be adjusted (unless the holders of a majority of the outstanding shares of Class B common stock agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of shares of Class A common stock issuable upon conversion of all shares of Class B common stock will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all shares of common stock outstanding upon the completion of this offering (excluding the placement units and underlying securities) plus all shares of Class A common stock and equity-linked securities issued or deemed issued in connection with the initial business combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in the initial business combination or any private placement-equivalent units issued to our sponsor or its affiliates upon conversion of loans made to us). The term "equity-linked securities" refers to any debt or equity securities that are convertible, exercisable or exchangeable for shares of Class A common stock issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt. Securities could be "deemed issued" for purposes of the conversion rate adjustment if such shares are issuable upon the conversion or exercise of convertible securities, warrants or similar securities. Election of directors; Voting Rights Prior to the consummation of our initial business combination, only holders of our Class B common stock will have the right to vote on the election of directors. Holders of the Class A common stock will not be entitled to vote on the election of directors during such time. These provisions of our amended and restated certificate of incorporation may only be amended if approved by at least 90% of our common stock voting at a stockholder meeting. With respect to any other matter submitted to a vote of our stockholders, including any vote in connection with our initial business combination, except as required by applicable law or stock exchange rule, holders of our Class A common stock and holders of our Class B common stock will vote together as a single class, with each share entitling the holder to one vote. Placement units Our sponsor has agreed to purchase an aggregate of 467,575 units (or up to 520,075 units depending on the extent to which the underwriters over-allotment option is exercised) at a purchase price of $10.00 per unit for a total purchase price of $4,675,750 (or up to $5,200,750 if the underwriter s over-allotment option is exercised in full). Each placement unit will be identical to the units sold in this offering, except as described in this prospectus. There will be no redemption rights or liquidating distributions from the trust account with respect to the founder shares, placement shares or placement warrants, which will expire worthless if we do not consummate a business combination within the allotted 12-month (or up to 18-month) period. Our initial stockholders have agreed to waive their redemption rights with respect to their placement shares (i) in connection with the consummation of a business combination, (ii) in connection with a stockholder vote to amend our amended and restated certificate of incorporation to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination, to redeem 100% of our public shares if we do not complete our initial business combination within twelve (12) months from the closing of this offering (or up to eighteen (18) months from the closing of this offering if we extend the period of time to consummate a business combination in full, as described in more detail in this prospectus) or with respect to any other provision relating to stockholders rights or pre-initial business combination activity and (iii) if we fail to consummate a business combination within twelve (12) months from the closing of this offering (or up to eighteen (18) months from the closing of this offering if we extend the period of time to consummate a business combination in full, as described in more detail in this prospectus) or if we liquidate prior to the expiration of the 12-month (or up to 18-month) period. However, our initial stockholders will be entitled to redemption rights with respect to any public shares held by them if we fail to consummate a business combination or liquidate within the 12-month (or up to 18-month) period. 13 Table of Contents Transfer restrictions on placement units The placement units and their component securities will not be transferable, assignable or salable until 30 days after the consummation of our initial business combination except to permitted transferees. Proceeds to be held in trust account Nasdaq rules provide that at least 90% of the gross proceeds from this offering and the sale of the placement units be deposited in a trust account. Of the net proceeds of this offering and the sale of the placement units, $102,000,000, or $10.20 per unit ($117,300,000, or $10.20 per unit, if the underwriters over-allotment option is exercised in full) will be placed into a trust account in the United States at J.P. Morgan Chase Bank, N.A., with Continental Stock Transfer & Trust Company acting as trustee. These proceeds include $3,000,000 (or up to $3,450,000 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our tax obligations (if any) and $100,000 of interest for our dissolution expenses, the proceeds from this offering and the sale of the placement units will not be released from the trust account (1) to us, until the completion of the initial business combination, or (2) to our public shareholders, until the earliest of (a) the completion of our initial business combination, and then only in connection with those Class A common stock that shareholders properly elect to redeem, subject to the limitations described herein, (b) the redemption of any public shares properly submitted in connection with a stockholder vote to amend our amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within twelve (12) months from the closing of this offering (or up to eighteen (18) months from the closing of this offering if we extend the period of time to consummate a business combination in full, as described in more detail in this prospectus) or (ii) with respect to any other provision relating to stockholders rights or pre-business combination activity, and (c) the redemption of our public shares if we are unable to complete our initial business combination within twelve (12) months from the closing of this offering (or up to eighteen (18) months from the closing of this offering if we extend the period of time to consummate a business combination in full, as described in more detail in this prospectus), subject to applicable law. Public shareholders who redeem their Class A common stock in connection with a stockholder vote described in clause (b) in the preceding sentence shall not be entitled to funds from the trust account upon the subsequent completion of an initial business combination or liquidation if we have not consummated an initial business combination within twelve (12) months from the closing of this offering (or up to eighteen (18) months from the closing of the offering if we extend the period of time to consummate a business combination in full, as described in more detail in this prospectus), subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public stockholders. 14 Table of Contents Ability to extend time to complete business combination If we anticipate that we may not be able to consummate our initial business combination within twelve (12) months, our sponsor may, but is not obligated to, extend the period of time to consummate a business combination up to two times, each by an additional three months (for a total of up to eighteen (18) months to complete a business combination), subject to our sponsor depositing additional funds into the trust account as set out below. Our stockholders will not be entitled to vote or redeem their shares in connection with any such extension. However, our stockholders will be entitled to vote and redeem their shares in connection with a general meeting held to approve an initial business combination or in a tender offer undertaken in connection with such an initial business combination if we propose such a business combination during any three-month extension period. Pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order for the time available for us to consummate our initial business combination to be extended, our sponsor, upon five days advance notice prior to the applicable deadline, must deposit into the trust account $1,000,000, or $1,150,000 if the underwriters over-allotment option is exercised in full ($0.10 per unit in either case) on or prior to the date of the applicable deadline, for each three month extension, up to an aggregate of $2,000,000 or $2,300,000 if the underwriters over-allotment option is exercised in full. Any such payments would be made in the form of a non-interest bearing loan. If we complete our initial business combination, we would repay such loaned amounts out of the proceeds of the trust account released to us. If we do not complete a business combination, we will not repay such loans. Furthermore, the letter agreement with our initial stockholders contains a provision pursuant to which our sponsor has agreed to waive its right to be repaid for such loans in the event that we do not complete a business combination. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. Anticipated expenses and funding sources Except as described above with respect to the payment of taxes, unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. The proceeds held in the trust account will be invested only in U.S. government securities with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. We will disclose in each quarterly and annual report filed with the SEC prior to our initial business combination whether the proceeds deposited in the trust account are invested in U.S. government treasury obligations or money market funds or a combination thereof. Based upon current interest rates, we expect the trust account to generate approximately $20,000 of pre-tax interest annually assuming an interest rate of 0.02% per year; however, we can provide no assurances regarding this amount. 15 Table of Contents Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the placement units not held in the trust account, which will be approximately $700,000 in working capital after the payment of approximately $475,750 in expenses relating to this offering; and any loans or additional investments from our sponsor, members of our management team or their affiliates or other third parties, although they are under no obligation to advance funds or invest in us, and provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of an initial business combination. Conditions to completing our initial business combination So long as our securities are then listed on Nasdaq, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. Our board of directors will make the determination as to the fair market value of our initial business combination. If our securities are not listed on the Nasdaq after this offering, we would not be required to satisfy the 80% requirement. However, we intend to satisfy the 80% requirement even if our securities are not listed on Nasdaq at the time of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. While we consider it unlikely that our board of directors will not be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of a target s assets or prospects. There is no limitation on our ability to raise funds privately, or through loans in connection with our initial business combination. Additionally, pursuant to Nasdaq rules, an initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination either (i) in such a way so that the post-transaction company in which our public stockholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses, or (ii) in such a way so that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or stockholders, or for other reasons. However, we will only complete an initial business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our stockholders prior to the initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the initial business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. 16 Table of Contents In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our stockholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of Nasdaq s 80% fair market value test. If the initial business combination involves more than one target business, the 80% fair market value test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking stockholder approval, as applicable. Permitted purchases of public shares and public warrants by our affiliates If we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, initial stockholders, directors, officers, or their affiliates may purchase public shares or public warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. There is no limit on the number of shares our initial stockholders, directors, officers, or their affiliates may purchase in such transactions, subject to compliance with applicable law and Nasdaq rules. However, (apart from the purchase of the placement units) they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. None of the funds held in the trust account will be used to purchase shares or public warrants in such transactions prior to completion of our initial business combination. See "Proposed Business — Permitted purchases of our securities" for a description of how our sponsor, initial stockholders, directors, officers, or any of their affiliates will select which stockholders to purchase securities from in any private transaction. The purpose of any such purchases of shares could be to vote such shares in favor of the initial business combination and thereby increase the likelihood of obtaining stockholder approval of the initial business combination or to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. The purpose of any such purchases of public warrants could be to reduce the number of public warrants outstanding or to vote such warrants on any matters submitted to the warrant holders for approval in connection with our initial business combination. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public "float" of our shares of Class A common stock or warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. 17 Table of Contents Redemption rights for public stockholders upon completion of our initial business combination We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.20 per public share. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and placement shares held by them and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination or otherwise. Manner of conducting redemptions We will provide our public stockholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a stockholder meeting called to approve the initial business combination or (ii) by means of a tender offer. The decision as to whether we will seek stockholder approval of a proposed initial business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek stockholder approval under the law or stock exchange listing requirements. Under Nasdaq rules, asset acquisitions and stock purchases would not typically require stockholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding common stock or seek to amend our amended and restated certificate of incorporation would require stockholder approval. We may conduct redemptions without a stockholder vote pursuant to the tender offer rules of the SEC unless stockholder approval is required by law or stock exchange listing requirements or we choose to seek stockholder approval for business or other legal reasons. So long as we obtain and maintain a listing for our securities on Nasdaq, we will be required to comply with such rules. 18 Table of Contents If a stockholder vote is not required and we do not decide to hold a stockholder vote for business or other legal reasons, we will, pursuant to our amended and restated certificate of incorporation: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Such provisions may be amended if approved by holders of at least 65% of our common stock entitled to vote thereon. Whether or not we maintain our registration under the Exchange Act or our listing on Nasdaq, we will provide our public stockholders with the opportunity to redeem their public shares by one of the two methods listed above. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase shares of our Class A common stock in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public stockholders not tendering more than a specified number of public shares, which number will be based on the requirement that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions (so that we are not subject to the SEC s "penny stock" rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. If public stockholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination. If, however, stockholder approval of the transaction is required by law or stock exchange listing requirements, or we decide to obtain stockholder approval for business or other legal reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and file proxy materials with the SEC. 19 Table of Contents If we seek stockholder approval, unless otherwise required by applicable law, regulation or stock exchange rules, we will complete our initial business combination only if a majority of the outstanding shares of common stock voted are voted in favor of the initial business combination. A quorum for such meeting will consist of the holders present in person or by proxy of shares of outstanding capital stock of the company representing a majority of the voting power of all outstanding shares of capital stock of the company entitled to vote at such meeting. Our initial stockholders will count towards this quorum and, pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote any founder shares and placement shares held by them and any public shares purchased during or after this offering (including in open market and privately negotiated transactions) in favor of our initial business combination. For purposes of seeking approval of the majority of our outstanding shares of common stock present and voting at the meeting to approve the business combination (unless required by applicable law to receive the majority of our outstanding common stock), non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. As a result, in addition to our initial stockholders founder shares and placement shares, we would need only 3,466,215, or approximately 34.66%, of the 10,000,000 public shares sold in this offering to be voted in favor of an initial business combination (assuming all outstanding shares are voted) in order to have our initial business combination approved (assuming the over-allotment option is not exercised, that the initial stockholders do not purchase any units in this offering or units or shares in the after, and that the representative shares are voted in favor of such initial business combination). In the event that all shares of our outstanding common stock are voted, we would need 199,320 or 1.99%, of the 10,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved (assuming the over-allotment option is not exercised, that the initial stockholders do not purchase any units in this offering or units or shares in the after-market, and that the representative shares are voted in favor of such initial business combination). We intend to give approximately 30 days (but not less than 10 days nor more than 60 days) prior written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination. The quorum and voting thresholds, as well as the voting agreements of our initial stockholders, may make it more likely that we will consummate our initial business combination. Each public stockholder may elect to redeem its public shares irrespective of whether they vote for or against the proposed transaction. We may require our public stockholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in "street name," to either deliver their stock certificates to our transfer agent prior to the date set forth in the tender offer documents mailed to such holders, or up to two business days prior to the vote on the proposal to approve the initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically. We believe that this will allow our transfer agent to efficiently process any redemptions without the need for further communication or action from the redeeming public stockholders, which could delay redemptions and result in additional administrative cost. If the proposed initial business combination is not approved and we continue to search for a target company, we will promptly return any certificates delivered, or shares tendered electronically, by public stockholders who elected to redeem their shares. Our amended and restated certificate of incorporation will provide that we will only redeem our public shares so long as (after such redemption) our net tangible assets will be at least $5,000,001 either immediately prior to or upon consummation of our initial business combination and after payment of underwriters fees and commissions (so that we are not subject to the SEC s "penny stock" rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. For example, the proposed initial business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed initial business combination. In the event the aggregate cash consideration we would be required to pay for all shares of Class A common stock that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed initial business combination exceed the aggregate amount of cash available to us, we will not complete the initial business combination or redeem any shares, and all shares of Class A common stock submitted for redemption will be returned to the holders thereof. 20 Table of Contents Limitation on redemption rights of stockholders holding 15% or more of the shares sold in this offering if we hold stockholder vote Notwithstanding the foregoing redemption rights, if we seek stockholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated certificate of incorporation will provide that a public stockholder, together with any affiliate of such stockholder or any other person with whom such stockholder is acting in concert or as a "group" (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. Absent this provision, a public stockholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against an initial business combination if such holder s shares are not purchased by us or our management at a premium to the then-current market price or on other undesirable terms. By limiting our stockholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of stockholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with an initial business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our stockholders ability to vote all of their shares (including all shares held by those stockholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Redemption rights in connection with proposed amendments to our certificate of incorporation Our amended and restated certificate of incorporation provides that any of its provisions related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the sale of the placement units into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public stockholders as described herein) may be amended if approved by holders of at least 50% of our common stock entitled to vote thereon, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of at least 50% of our common stock entitled to vote thereon. In all other instances, our amended and restated certificate of incorporation may be amended by holders of a majority of our outstanding common stock entitled to vote thereon, subject to applicable provisions of the Delaware General Corporation Law, or DGCL, or applicable stock exchange rules. 21 Table of Contents Under our amended and restated certificate of incorporation, we may not issue additional securities that can vote on amendments to our amended and restated certificate of incorporation or on our initial business combination or that would entitle holders thereof to receive funds from the trust account. Our initial stockholders, who will collectively beneficially own approximately 22.7% of our common stock upon the closing of this offering (including the placement shares and assuming they do not purchase any units in this offering), will participate in any vote to amend our amended and restated certificate of incorporation and/or trust agreement and will have the discretion to vote in any manner they choose. Our sponsor, executive officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated certificate of incorporation (i) to modify the substance or timing of our obligation to allow holders to redeem their shares in connection with an initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within twelve (12) months from the closing of this offering (or up to eighteen (18) months from the closing of this offering if we extend the period of time to consummate a business combination in full, as described in more detail in this prospectus) or (ii) with respect to any other provision relating to stockholders rights or pre-business combination activity, unless we provide our public stockholders with the opportunity to redeem their shares of Class A common stock upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable) divided by the number of then outstanding public shares. Our sponsor, officers and directors have entered into a letter agreement with us pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and placement shares and any public shares held by them in connection with the completion of our initial business combination. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be used to pay amounts due to any public stockholders who exercise their redemption rights as described above under "Redemption rights for public stockholders upon completion of our initial business combination." We will use the remaining funds to pay the representative of the underwriters the deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or the redemption of our public shares, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. 22 Table of Contents Redemption of public shares and distribution and liquidation if no initial business combination Our amended and restated certificate of incorporation provides that we will have only twelve (12) months from the closing of this offering (or up to eighteen (18) months from the closing of this offering if we extend the period of time to consummate a business combination in full, as described in more detail in this prospectus)to complete our initial business combination. If we are unable to complete our initial business combination within such 12-month (or up to 18-month) period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our taxes (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public stockholders rights as stockholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining stockholders and our board of directors, dissolve and liquidate, subject in the case of clauses (ii) and (iii) above to our obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within the 12-month (or up to 18-month) time period. Our sponsor, officers and directors have entered into a letter agreement with us pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and placement shares if we are forced to liquidate. The underwriters have agreed to waive (i) their rights to their deferred underwriting commission and (ii) to redeem their placement shares, in the event we do not complete our initial business combination and subsequently liquidate and, in such event, the deferred fees will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. 23 Table of Contents Limited payments to insiders There will be no finder s fees, reimbursement, consulting fee, non-cash payments, monies in respect of any payment of a loan or other compensation paid by us to our sponsor, officers, directors or any affiliate of our sponsor, officers, directors prior to, or in connection with any services rendered in order to effectuate, the consummation of our initial business combination (regardless of the type of transaction that it is). However, the following payments will be made to our sponsor, officers, directors, or our or their affiliates, none of which will be made from the proceeds of this offering held in the trust account prior to the completion of our initial business combination: Repayment of up to an aggregate of $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; Payment to our sponsor of $10,000 per month, for twelve (12) months (or up to eighteen (18) months, as applicable), for office space, utilities and secretarial and administrative support; Reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; and Repayment of non-interest bearing loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans may be converted into units, at a price of $10.00 per unit at the option of the lender, upon consummation of our initial business combination. The units would be identical to the placement units. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers, directors, or our or their affiliates. Audit Committee We will establish and maintain an audit committee, which will be composed entirely of independent directors to, among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section of this prospectus entitled "Management — Committees of the Board of Directors — Audit Committee." Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third party for services rendered or products sold to us, or a prospective target business with which we have entered into a written letter of intent, confidentiality or similar agreement or business combination agreement, reduce the amount of funds in the trust account to below the lesser of (i) $10.20 per public share and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.20 per share due to reductions in the value of the trust assets, less taxes payable, provided that such liability will not apply to any claims by a third party or prospective target business who executed a waiver of any and all rights to the monies held in the trust account (whether or not such waiver is enforceable) nor will it apply to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. However, we have not asked our sponsor to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that our sponsor s only assets are securities of our company. Therefore, we cannot assure you that our sponsor would be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses. 24 Table of Contents RISKS We are a newly formed company that has conducted no operations and has generated no revenues. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision whether to invest in our securities, you should take into account not only the background of our management team, but also the special risks we face as a blank check company. This offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see the section of this prospectus entitled "Proposed Business — Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419." You should carefully consider these and the other risks set forth in the section of this prospectus entitled "Risk Factors" beginning on page 28 of this prospectus. Summary Risk Factors Our public stockholders may not be afforded an opportunity to vote on our proposed initial business combination, which means we may complete our initial business combination even though a majority of our public stockholders do not support such a combination. Your only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash, unless we seek stockholder approval of the initial business combination. If we seek stockholder approval of our initial business combination, our initial stockholders have agreed to vote in favor of such initial business combination, regardless of how our public stockholders vote. The ability of our public stockholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into an initial business combination with a target. The ability of our public stockholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure. Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the ongoing novel coronavirus ("COVID-19") outbreak. If we seek stockholder approval of our initial business combination, our sponsor, directors, officers and their affiliates may elect to purchase shares or warrants from public stockholders, which may influence a vote on a proposed initial business combination and reduce the public "float" of our Class A common stock. If a stockholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination or fails to comply with the procedures for tendering its shares, such shares may not be redeemed. The securities in which we invest the funds held in the trust account could bear a negative rate of interest, which could reduce the value of the assets held in trust such that the per-share redemption amount received by public stockholders may be less than $10.20 per share. You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. To liquidate your investment, therefore, you may be forced to sell your public shares or warrants, potentially at a loss. Nasdaq may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities and subject us to additional trading restrictions. Because of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination. If we are unable to complete our initial business combination, our public stockholders may receive only approximately $10.20 per share on our redemption of our public shares, or less than such amount in certain circumstances, and our warrants will expire worthless. If the net proceeds of this offering and the sale of the placement units not being held in the trust account are insufficient to allow us to operate for at least the next twelve (12) months (or up to eighteen (18) months), we may be unable to complete our initial business combination, in which case our public stockholders may only receive $10.20 per share, or less than such amount in certain circumstances, and our warrants will expire worthless. Past performance by members of our management team or their affiliates may not be indicative of future performance of an investment in us. 25 Table of Contents SUMMARY FINANCIAL DATA The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. As of October 8, 2021 Balance Sheet Data: Working capital (deficiency) $(51,433) Total assets $100,995 Total liabilities $76,433 Stockholder s equity $24,562 26 Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2022/HLNCF_haleon-plc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/HLNCF_haleon-plc_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights certain information about us, this offering and selected information contained elsewhere in this prospectus. This summary is not complete and does not contain all of the information that you should consider before deciding whether to invest in the securities covered by this prospectus. For a more complete understanding of our Company and this offering, we encourage you to read and consider carefully the more detailed information in this prospectus, and any related prospectus supplement, including the information set forth in the section titled Risk Factors in this prospectus and any related prospectus supplement in their entirety before making an investment decision. Overview The Group is a world-leading consumer healthcare business, with a portfolio of category leading brands and approximately 23,000 people worldwide engaged in the research and development, manufacture and sale of a broad range of consumer healthcare products. The Group conducts business internationally across five consumer healthcare categories: Oral Health, Pain Relief, VMS, Respiratory Health and Digestive Health and Other. The Group has a strong footprint in the world s consumer healthcare markets, including a commercial presence in over 170 markets and a number one or two OTC/VMS market position in countries which represented over 70 per cent. of the world s OTC/VMS markets by value in 2021. Corporate Information Our Ordinary Shares are admitted to the premium listing segment of the Official List of the FCA and trading on the main market for listed securities of the LSE under the symbol HLN and our ADSs are listed on the New York Stock Exchange ( NYSE ) under the symbol HLN . The Company is domiciled in England and Wales with its registered and head office at Building 5, First Floor, The Heights, Weybridge, Surrey, KT13 0NY, United Kingdom. The telephone number of the Company s registered office is +44 1932 822000 and its website is www.haleon.com. The information on the Company s website does not form part of this prospectus. SUMMARY OF RISK FACTORS Our business is subject to numerous risks and uncertainties, including those highlighted in the Risk Factors section of this prospectus. These risks include the following, any of which could have a material adverse effect on our business, financial condition or results of operations and the price of our Securities: Risks Relating to the Group s Business and Industry: The Group operates in a highly competitive market and failure to successfully compete with competitors could have a material adverse effect on the Group s business; The Group s success depends on its ability to anticipate and respond to changes in consumer preferences and a failure to adapt its strategy appropriately may have a material adverse effect on the Group s business and/or financial condition; The Group s business results are impacted by the Group s ability to manage disruptions in the Group s global supply chain and a failure to manage disruptions appropriately may have a material adverse effect on the Group s business and/or financial condition; Increasing dependence on key retail customers, changes in the policies of the Group s retail customers, the emergence of alternative retail channels and the rapidly changing retail landscape may materially and adversely affect the Group s business; Table of Contents The Group may not be able to develop and commercialise new products effectively, which may materially and adversely affect the results of the Group s operations and financial condition; Failure to retain key personnel or attract new personnel may materially and adversely affect the Group s business; Damage to the Group s reputation could have a material adverse effect on the Group s business; Failure to respond effectively to the challenges raised by climate change and other sustainability matters may have a material adverse effect on the Group s business and results of operations; The Group may not be successful in obtaining, maintaining and enforcing sufficient intellectual property rights to protect its business, or in avoiding claims that the Group infringes on the intellectual property rights of others; The Group may incur liabilities or be forced to recall products as a result of real or perceived product quality or other product-related issues; A cyber-security incident, data breach or a failure of a key information technology system could materially and adversely impact the Group s business; The Group relies on third parties in many aspects of its business and ineffective management of these relationships could increase the Group s financial, legal, reputational and operational risk; The Group faces various risks related to pandemics, epidemics or similar widespread public health concerns, the ultimate impact of which is outside the Group s control and which may materially and adversely affect the Group s operations, cash flows and financial condition; The implementation of complex strategic, operational and/or change initiatives gives rise to significant execution risks, which may affect the operational capacity of the Group and may materially and adversely impact the Group if these initiatives fail to meet their objectives; The Group s business is affected by seasonality, which could have a negative impact on the Group s financial condition; The Group may not successfully acquire and integrate other businesses, licence rights to technologies or products, form and manage alliances, or divest businesses; The Group s leverage and debt service obligations could materially and adversely affect its business, financial condition or results of operations; The Group s business and results of operations are affected by fluctuations in interest rates; and Goodwill and indefinite-life intangible assets are a material component of the Group s balance sheet and impairments of these assets could have a significant impact on its results. Risks Relating to Changes in Law and the Political and Environment, Regulation and Legislation: The Group s business is subject to legal and regulatory risks in all the markets in which it operates, which may have a material adverse effect on the Group s business operations and financial condition; The Group faces risks relating to the regulation and perception of the ingredients it uses in its products, which could materially and adversely impact the Group s business, prospects, financial condition and results of operations; The Group s business is subject to market fluctuations and general economic conditions, including inflationary pressures, each of which may materially and adversely affect the Group s business, financial condition, results of operations and prospects; Table of Contents Litigation, disputes and regulatory investigations may materially and adversely affect the Group s business, financial condition, results of operations and prospects; The Group faces risks associated with significant international operations, which could negatively impact the Group s business; Volatility in material and other costs could materially and adversely impact the Group s profitability; The Group s business may be impacted by the effects of Russia s invasion of Ukraine; Failure to comply with regulation regarding the use of personal data could lead to significant fines and regulatory action against the Group; Failure to comply, or the costs of complying, with environmental and health and safety regulations could materially and adversely affect the Group s operations; The Group is exposed to risks relating to fluctuations in currency exchange rates and related hedging activities, which could negatively impact the Group s financial condition and prospects; Determinations made by the Group with respect to the application of tax law may result in challenges from or disputes with tax authorities which result in the payment of additional amounts for tax; The Company is a foreign private issuer and, as a result, it is not subject to US proxy rules and is subject to Exchange Act reporting obligations that, to some extent, are more lenient and less frequent than those of a US domestic public company; and If the Company loses its foreign private issuer status in the future, it may incur significant additional expenses which could have a material adverse effect on the Group s business, prospects, results of operations and financial condition. Risks Relating to Separation: The Group may fail to realise any or all of the anticipated benefits of Separation; Following Separation, the Company operates as an independent publicly listed company and the Group could fail to meet the challenges involved in operating successfully as a standalone business; For a period following Separation, the Company will be reliant on the GSK Group for the provision of certain services and any disruption to such services could be costly and materially and adversely affect the Group s business, results of operations, financial conditions and prospects; The Group has indemnification obligations in favour of the GSK Group and the Pfizer Group, which could be significant and have a material adverse effect on the financial condition, results of operations and/or prospects of the Group; GSK and Pfizer may compete with the Group; The Company s status as a non-US corporation for US federal income tax purposes could be affected by a potential change in law; and The Tax Covenant will restrict the Company s ability to engage in certain transactions. Risks Relating to the Ordinary Shares and ADSs: An active trading market for the Ordinary Shares and the ADSs may not develop or be sustained; The Pfizer Group retained a significant interest in the Company immediately after Separation and its interests may differ from those of the other holders of the Ordinary Shares and the ADSs; There can be no assurance that dividends will be paid to holders of Ordinary Shares and ADSs; Table of Contents The market price of the Ordinary Shares and the ADSs may fluctuate; Future sales of Ordinary Shares and ADSs, or the perception such sales might occur, could depress the market price of the Ordinary Shares and the ADSs; The Company may decide to offer additional Ordinary Shares (including in the form of ADSs) in the future, diluting the interests of existing holders of Ordinary Shares and ADSs and potentially materially and adversely affecting the market price of Ordinary Shares and ADSs; Holders of the Ordinary Shares and the ADSs may not be able to exercise pre-emption rights or participate in certain future issues of Ordinary Shares; The ability of holders of the Ordinary Shares and the ADSs outside the UK to bring actions or enforce judgments against the Company or the Directors may be limited; Haleon Shareholders outside the UK may be subject to exchange rate risk; Holders of the ADSs are not treated as holders of the Ordinary Shares; Holders of the ADSs will not have the same voting rights as the holders of the Ordinary Shares and may not receive voting materials in time to be able to exercise their right to vote; Holders of the ADSs may be subject to limitations on the transfer of their ADSs and the withdrawal of the underlying Ordinary Shares; Holders of the ADSs may not receive distributions on the underlying Ordinary Shares or any value for them if it is illegal or impractical to make them available to holders of the ADSs; Holders of ADSs may not be entitled to a jury trial with respect to claims arising under the Deposit Agreement, which could result in less favourable outcomes to the plaintiff(s) in any such action; and Forum selection provisions in the Deposit Agreement could limit the ability of holders of ADSs to obtain a favorable judicial forum for disputes with the Company and the Depositary. 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+PROSPECTUS SUMMARY 1 RISK FACTORS 16 USE OF PROCEEDS 36 DIVIDEND POLICY 37 CAPITALIZATION 37 MARKET PRICE FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS 38 DILUTION 38 DESCRIPTION OF BUSINESS 39 MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 50 EXPANDED PRO-FORMA IMPACT OF INCOME TAXES ON 2020 AND 2019 FINANCIALS 60 MANAGEMENT 64 EXECUTIVE COMPENSATION 71 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT 81 CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS 82 UNDERWRITING 84 DESCRIPTION OF SECURITIES 93 LEGAL MATTERS 96 EXPERTS 96 APPOINTMENT OF AUDITOR 96 DISCLOSURE OF COMMISSION S POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES 96 WHERE YOU CAN FIND ADDITIONAL INFORMATION 96 INDEX TO FINANCIAL STATEMENTS F-1 No dealer, salesperson or other individual has been authorized to give any information or to make any representation other than those contained in this prospectus in connection with the offer made by this prospectus and, if given or made, such information or representations must not be relied upon as having been authorized by us. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities in any jurisdiction in which such an offer or solicitation is not authorized or in which the person making such offer or solicitation is not qualified to do so, or to any person to whom it is unlawful to make such offer or solicitation. Neither the delivery of this prospectus nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in our affairs or that information contained herein is correct as of any time subsequent to the date hereof. For investors outside the United States: We have not done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves, and observe any restrictions relating to, the offering of the shares of our common stock and the distribution of this prospectus outside the United States. i Cautionary Note Regarding Forward-Looking Statements This prospectus contains forward-looking statements. Specifically, forward-looking statements may include statements relating to: our future financial performance; changes in the market for our products and services; our expansion plans and opportunities; and other statements preceded by, followed by or that include the words "estimate," "plan," "project," "forecast," "intend," "expect," "anticipate," "believe," "seek," "target" or similar expressions. These forward-looking statements are based on information available as of the date of this prospectus and current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include: the level of demand for our products and services; competition in our markets; our ability to grow and manage growth profitably; our ability to access additional capital; changes in applicable laws or regulations; our ability to attract and retain qualified personnel; the possibility that we may be adversely affected by other economic, business, and/or competitive factors; and other
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+PROSPECTUS SUMMARY This summary highlights information contained in greater detail elsewhere in this prospectus and does not contain all of the information that you should consider before deciding to invest in our securities. You should read the entire prospectus carefully, including the Risk Factors commencing on page 12 hereof, Summary Historical Consolidated Financial and Other Data commencing on page 10 hereof, as well as Management s Discussion and Analysis of Financial Condition and Results of Operations and our consolidated financial statements and the related notes incorporated by reference into this prospectus, before making an investment decision. Some of the statements in this prospectus and in the documents incorporated by reference herein constitute forward-looking statements. See Cautionary Note Regarding Forward-Looking Statements. Unless otherwise indicated in this prospectus, Biostage, the Company, we, us and our refer to Biostage, Inc. and, where appropriate, its subsidiaries. Overview We are a clinical-stage biotechnology company developing regenerative-medicine treatments for disorders of the gastro-intestinal system and the airway resulting from cancer, trauma or birth defects. Our technology is based on our proprietary cell-therapy platform that uses a patient s own stem cells to regenerate and restore function to damaged organs. We believe that our technology represents a next-generation solution for restoring organ function because it allows the patient to regenerate their own organ, thus eliminating the need for human donor or animal transplants, the sacrifice of another of the patient s own organs or permanent artificial implants. We conducted the world s first successful regeneration of the esophagus in a patient with esophageal cancer in August 2017. This surgery was performed by Dr. Denis Wigle, Chair of Thoracic Surgery at the Mayo Clinic. The results were published in the Journal of Thoracic Oncology Clinical and Research Reports in August 2021. The procedure demonstrated that our technology was able to successfully regenerate esophageal tissue, including the mucosal lining, to restore the integrity, continuity and functionality of the esophageal tube. Our technology uses mesenchymal stem cells that are retrieved via biopsy from the patient s abdominal adipose tissue prior to surgery. These stem cells are isolated, expanded and then implanted on a hollow, tubular scaffold made from extremely thin fibers of polyurethane. The scaffold is then incubated in a customized bioreactor where the stem cells expand further and begin to adhere to the tubular scaffold. The finished graft is then surgically implanted to replace the resected portion of the damaged organ. Several weeks after surgery, once a conduit has been established, the implanted scaffold is removed. No permanent artificial implant remains in the body. We are initially targeting regeneration of the organs of the gastro-intestinal tract and the airway, where organ transplants are not medically possible today. Human-donor organ transplants or animal xenotransplants are currently not performed for these organs due to high rates of rejection. Additionally, we believe that our technology and intellectual property will allow us to develop organ-regeneration treatments for other organs. Based on our successful first-in-human procedure and our preclinical procedures in 45 pigs, the FDA has approved our Investigational New Drug (IND) application to begin a combined phase 1/2 clinical trial for esophageal regeneration. This open-label trial will assess both safety and efficacy in up to ten patients requiring up to a 6cm esophageal replacement for any reason, including cancer, at up to five U.S. hospitals. We intend to initiate this trial in early 2023. AMENDMENT NO. 1 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Our Strategy Our strategy is to develop and advance our pipeline of products, beginning with our lead product for the treatment of esophageal cancer, through clinical development and commercialization. The key elements of our strategy include: Initiate the phase 1/2 clinical trial for our lead product candidate, the BiostageTM Esophageal Implant, for the treatment of severe esophageal disease. Based upon our successful initial case of esophageal regeneration and our animal models, the FDA has approved our Investigational New Drug (IND) application to commence a clinical trial in up to ten patients. We plan to initiate this trial in early 2023. Advance our other pipeline products through clinical development. Based on the establishment of a favorable safety and efficacy profile that we expect to demonstrate in our phase 1/2 clinical trial for regeneration of the esophagus, we intend to initiate a clinical trial for the treatment of esophageal atresia, a rare birth defect. As we build our safety and efficacy data, we plan to initiate clinical trials in other areas including cancer, injury and birth defects in the bronchus. Develop our technology for use in other life-threatening conditions that have a relatively shorter time to market. We believe our technology has broad applications to treat organ failure. We intend to develop products focused on life-threatening conditions where current treatments are ineffective, expensive or both. Many organ failures are orphan diseases, and we have orphan drug designations from the FDA on our product candidates for severe disease in both the esophagus and the trachea. We believe that developing products for such conditions will require smaller clinical trials and an overall less expensive development pathway than developing treatments for less severe conditions. Pursue development pathways in international markets. In addition to the U.S., we intend to pursue regulatory approval for our products in several key international markets, including China, Europe and the UK. Many of the conditions we are targeting have significantly higher patient populations in foreign countries than in the U.S., thereby making them attractive commercial markets. We intend to engage foreign health regulatory bodies to develop clinical and regulatory strategies to gain international approvals. BIOSTAGE, INC. (Exact name of registrant as specified in its charter) Table of Contents Collaborate with leading medical and research institutions to develop our products and build awareness. We intend to continue to collaborate with thought-leading medical institutions as we continue clinical development of our products and ultimately reach commercialization. We currently have a co-development initiative with the Mayo Clinic and with the Connecticut Children s Medical Center. We intend to build additional partnerships and collaborations with leading institutions that we believe will help to drive awareness of our products and increase the likelihood of market adoption. Our Competitive Strengths There is currently no product available to surgeons to repair the esophagus when a section has been removed. Hence, our current competition is existing surgical procedures such as gastric pull-up or colonic interposition, rather than an alternative product. Compared with the current standard of care procedures for esophageal cancer patients, either gastric pull-up or colonic interposition, the Biostage Esophageal Implant offers the following major advantages of use: Patients can avoid the frequently life-threatening complications of either gastric pull up or colonic interpositioning surgery; Autologous stem cells eliminate the risk of immune system rejection; The procedure does not require the sacrifice of the patient s stomach or colon, as those organs will remain intact and function accordingly; The procedure does not leave a permanent implant or artificial structure in the body as permanent implants can lead to long-term complications, including infection, which can lead to further surgical procedures for removal; Eliminates the need for sutures where the two ends of the esophagus are joined together whereas the sutures are a frequent cause of fluid leaks and infections post-surgery; and Patients can return to a reasonable diet after a procedure with the Biostage Esophageal Implant. We believe that these significant medical advantages will lead to strong demand from patients and doctors for the Biostage Esophageal Implant. Additionally, we believe that it will receive a favorable reimbursement profile from payors and insurance companies when giving consideration of the high cost and complications associated with current procedures. Our Market According to the American Cancer Society, every year approximately 20,000 Americans are diagnosed with esophageal cancer and approximately 15,000 of these diagnosed patients die from it. A year after being diagnosed with esophageal cancer, 50% of the patients have died. After five years, 80% of these patients have died. According to the World Health Organization s International Agency for Research on Cancer, every year, there are more than 600,000 patients diagnosed with esophageal cancer worldwide. The current treatment for patients with esophageal cancer is removal of the diseased part of the esophagus in a surgical procedure called an esophagectomy. The gap left by the removal of part of the esophagus is then repaired using one of two difficult and expensive surgeries, both of which have significant complications. The first type of surgery is gastric pull-up. In this surgery, the patient s stomach is reshaped into a tube and pulled up from the abdomen into the chest to connect to the top of the esophagus. With gastric pull-up, the patient no longer has a stomach with which to digest food. In the second type of surgery, termed colonic interposition, a piece of the patient s bowel is cut out and used to bridge the gap where the diseased esophagus was removed. With colonic interposition, the patient often has insufficient intestine to digest food properly. Both surgical procedures have high rates of complications such as damage to the lungs and infections caused by leakage of stomach acids into the chest. Even with these surgical treatments, esophageal cancer is one of the deadliest forms of cancer. Delaware 3841 45-5210462 (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification No.) 84 October Hill Road, Suite 11, Holliston, Massachusetts 01746 (774) 233-7300 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Table of Contents In addition to cancer, there are other injuries to the esophagus such as fistulas (holes), injuries caused by the accidental ingestion of acids and alkalis, and birth defects. These are all difficult to treat surgically and often have significant long-term complications. We are currently working in collaboration with the Connecticut Children s Medical Center to develop a Biostage Esophageal Implant to address esophageal atresia, a condition where an infant is born with an esophagus that does not extend completely from the mouth to the stomach. Esophageal atresia is estimated to impact 1,000 children per year in the United States. The current standard of care is a series of surgical procedures where sutures are applied to both ends of the esophagus in an attempt to stretch them and pull them together so they can be surgically connected at a later date. We believe the Biostage Esophageal Implant represents a potentially safer and more effective treatment for these children. We also intend to develop the Biostage Bronchial Implant to treat bronchial cancer, bronchial fistulas (holes), and birth defects in the bronchus. Based on discussions with surgeons in the field, we estimate that approximately 7,000 patients in the U.S. and Europe would be potentially treatable with our technology. Nasdaq Listing We have applied to list our common stock on the Nasdaq Capital Market under the symbol BSTG. No assurance can be given that our application will be approved or that an active trading market for our shares will develop. This offering will only occur if Nasdaq approves the listing of our common stock. Summary of Risk Factors Our business is subject to a number of risks and uncertainties, including those risks discussed at length in the section below titled Risk Factors. These risks include, among others, the following: Our product candidates are in an early stage of development. If we are unable to develop or market any of our product candidates, our financial condition will be negatively affected, and we may have to curtail or cease our operations. We have generated no revenue from commercial operations to date and have an accumulated deficit. We anticipate that we will incur losses for the foreseeable future. We may never achieve or sustain profitability. We had previously identified a material weakness in our internal control over financial reporting which has been remediated. This prior material weakness, our discovery of any additional weaknesses, and our inability to achieve and maintain effective internal control over financial reporting, could adversely affect our results of operations, our stock price and investor confidence in our company. Our product candidates will subject us to liability exposure. The results of our clinical trials or pre-clinical development efforts may not support our product candidates claims or may result in the discovery of adverse side effects. Our audited financial statements for the year ended December 31, 2021 contain a going concern qualification. Our financial status creates doubt whether we will continue as a going concern. We will need additional funds in the near future and our operations will be adversely affected if we are unable to obtain needed funding. If we fail to obtain, or experience significant delays in obtaining, regulatory approvals in the U.S., China or the E.U. for our product candidates, including those for the esophagus and airways, or are unable to maintain such clearances or approvals for our product candidates, our ability to commercially distribute and market these products would be adversely impacted. Even if our product candidates are cleared or approved by regulatory authorities, if we or our suppliers fail to comply with ongoing FDA or other foreign regulatory authority requirements, or if we experience unanticipated problems with our product candidates, these product candidates could be subject to restrictions or withdrawal from the market. The COVID-19 pandemic could continue to adversely impact our business, including clinical trials. David Green Interim Chief Executive Officer, Chairman and Director 84 October Hill Road, Suite 11, Holliston, Massachusetts 01746 (774) 233-7300 (Name, address, including zip code, and telephone number, including area code, of agent for service) Table of Contents Our principal stockholders hold a significant percentage of our voting power and will be able to exert significant control over us. Recent Developments Legal Proceedings and Issuance of Preferred Stock As previously disclosed, on April 14, 2017, representatives for the estate of an individual plaintiff filed a wrongful death complaint with the Suffolk Superior Court, in the County of Suffolk, Massachusetts, against us and other defendants, including Harvard Bioscience, Inc., or HBIO, the former parent of the Company that spun off the Company in 2013, as well as another third party. The complaint sought payment for an unspecified amount of damages and alleged that the plaintiff sustained terminal injuries allegedly caused by products provided by certain of the named defendants and utilized in connection with surgeries performed by third parties in Europe in 2012 and 2013. This lawsuit relates to our first-generation trachea scaffold technology for which we discontinued development in 2014, and not to our current Biostage Esophageal Implant. On April 27, 2022, the Company and HBIO executed a settlement with the plaintiffs (the Settlement ), which resolves all claims relating to the litigation. The Settlement resulted in the dismissal with prejudice of the wrongful death claim, and neither we nor HBIO admitted any fault or liability in connection with the claim. The Settlement also resolved any and all claims by and between the parties and our products liability insurance carriers, which resulted in the dismissal with prejudice of all claims asserted by or against those carriers, the Company and HBIO. However, based on review of the circumstances surrounding the Settlement, we recorded an accrual for this matter of approximately $3.3 million in general and administrative expenses during the year ended December 31, 2021. In relation to the litigation, we have incurred approximately $5.9 million of aggregate costs, of which, approximately $1.3 million remain unpaid as of June 30, 2022. This aggregate amount includes the cost of both the accrual for contingency matter of approximately $3.3 million and approximately $2.6 million of legal and related costs incurred by us which consist of attorney s fees and advisor and specialist costs as part of our defense in this matter. For the three and six months ended June 30, 2022, we incurred legal and related costs of approximately $0.1 million and $1.2 million, respectively, recorded in general and administrative expenses. On March 3, 2022, we received a cash payment of approximately $0.1 million from Medmarc, our insurance carrier. This amount represented a reimbursement of previously incurred legal costs and was recorded as a reduction to general and administrative expenses during the six months ended June 30, 2022. With respect to such $5.9 million of costs described above, we were required to either pay such costs directly or indemnify HBIO as to such amounts it incurs. Of such amounts, we anticipated that HBIO would pay an aggregate amount of $4.0 million by the end of the second quarter of 2022. With respect to the indemnification obligation of the Company to HBIO pertaining to such costs, we and HBIO entered into a Preferred Issuance Agreement dated as of April 27, 2022, or the PIA . In connection with the PIA, we and HBIO agreed that once HBIO had paid at least $4.0 million in such costs, to satisfy our indemnification obligations with respect thereto, in lieu of paying cash, we would issue senior convertible preferred stock to HBIO that will contain terms as described in the PIA, including the term sheet attached thereto. On June 10, 2022, following the execution of a subscription agreement and HBIO providing evidence of payment of the requisite $4.0 million amount, we issued HBIO 4,000 shares of Series E Preferred Stock at a price of $1,000 per share to satisfy our related indemnification obligations aggregating $4.0 million, which included the accrual for contingency of approximately $3.3 million and approximately $0.8 million of legal and related costs paid on behalf of the Company by HBIO. These shares of preferred stock will automatically convert into shares of our common stock in connection with the closing of this offering. The number of shares of common stock into which these shares of Series E Preferred Stock will convert will be determined by dividing the stated value of each of share of $1,000, plus all accrued and unpaid dividends, by the Offering Conversion Price and rounding to the nearest whole share number. Dividends are payable quarterly in additional shares of Series E Preferred Stock at a rate of 8% per annum, accrued daily and compounded quarterly. The Offering Conversion Price for each share of Series E Preferred Stock is the price to the public of units in this offering. Private Placement On May 12, 2022, we entered into Securities Purchase Agreements, each a Purchase Agreement, with new and existing investors, or, the Investors, pursuant to which the Investors agreed to purchase in a private placement an aggregate of Copies to: 125 High Street Boston, MA 02110 (617) 345-3000 Chad J. Porter Burns & Levinson LLP 125 High Street Boston, MA 02110 (617) 345-3000 Stephen E. Older David S. Wolpa McGuireWoods LLP 1251 Avenue of the Americas, 20th Floor New York, New York 10020 (212) 548-2100 Table of Contents 854,771 shares of common stock and warrants to purchase 427,390 shares of common stock, subject to adjustment as provided in the warrant agreement, or, the Warrants, for an aggregate purchase price of approximately $5.1 million with a purchase price per unit of $5.92. Each unit consisted of one share of common stock and a warrant to purchase one half of one share of common stock, subject to adjustment, as provided in the Warrants. We received an aggregate of $5.1 million of gross proceeds from the sale of securities under these Purchase Agreements through May 16, 2022. Reverse Stock Split Authority In anticipation of the offering to which this prospectus relates, our stockholders approved, at a special meeting of stockholders, a resolution to authorize our board of directors to implement a reverse split of our issued and outstanding common stock at a ratio of not less than 1-for-1.25 and not greater than 1-for-5. The resolution empowered our board of directors to make a final decision on whether to proceed with a reverse stock split, at which exact ratio the reverse split will be effected and the timing of the reverse split, in its discretion, but no later than July 28, 2023. While the Board does not currently anticipate effectuating such reverse split prior to the closing of the offering to which this prospectus relates, it will monitor market conditions and may at any time in its discretion decide to implement such reverse stock if it deems it in the best interest of the stockholders, whether in relation to compliance with listing requirements for The Nasdaq Capital Market or otherwise. If implemented, there can be no assurance that the trading price of our common stock would be maintained at such level following the split or that we will be able to maintain any such listing of our common stock on The Nasdaq Capital Market if we are able to uplist in the future. Chief Financial Officer Appointment On August 8, 2022, the Company appointed Joseph L. Damasio, Jr. as Chief Financial Officer. Mr. Damasio, age 48, has over 20 years of finance and accounting experience, most recently as Vice President of Finance at Inhibikase Therapeutics, a publicly-traded clinical stage biopharmaceutical company, since October 2021 prior to joining Biostage. Before joining Inhibikase, Mr. Damasio was Controller at Cue Biopharma from June 2020 to October 2021, Controller at XL Fleet from February 2019 to June 2020, and Chief Financial Officer at Pressure BioSciences, Inc. from April 2017 to February 2019. Certifying Accountant Appointment On October 10, 2022, the Company engaged Marcum LLP as its independent registered public accounting firm for the fiscal year ended December 31, 2022. Our Corporate Information We were incorporated under the name Harvard Apparatus Regenerative Technology, Inc. under the laws of the State of Delaware on May 3, 2012 by HBIO to provide a means for separating its regenerative medicine business from its other businesses. On March 31, 2016, we changed our name from Harvard Apparatus Regenerative Technology, Inc. to Biostage, Inc. Our executive offices are located at 84 October Hill Road, Suite 11, Holliston. Massachusetts 01746. Our telephone number is (774) 233-7300. Our website address is www.biostage.com. Information contained on, or accessible through, our website shall not be deemed incorporated into and is not a part of this prospectus or the registration statement of which it forms a part. We have included our website in this prospectus solely as an inactive textual reference. Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box: If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Non-accelerated filer Accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents
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+PROSPECTUS SUMMARY
+This summary highlights information contained elsewhere in this prospectus. It does not contain all the information that you may consider important in making your investment decision. Therefore, you should read the entire prospectus carefully, including, in particular, the sections entitled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations, and our 2021 Year End Financial Statements and 2021 Year End Notes.
+As used in this prospectus, unless the context otherwise requires or indicates, references to Hycroft, Company, HYMC, we, our, and us, refer to Hycroft Mining Holding Corporation and its subsidiaries. Seller refers to Hycroft Mining Corporation prior to the Recapitalization Transaction.
+Overview
+We are a U.S.-based gold and silver development company that owns the Hycroft Mine in the prolific mining region of Northern Nevada.
+Our property, the Hycroft Mine, has historically operated as an open-pit oxide mining and heap leach processing operation and is located approximately 54 miles west of Winnemucca, Nevada. Mining operations at the Hycroft Mine were restarted in 2019 on a pre-commercial scale and discontinued in November 2021 as a result of the then current and expected ongoing cost pressures for many of the reagents and consumables used at the Hycroft Mine and the timeline for completing our updated technical studies in 2022 for optimal processing the plan forward. In February 2022, Hycroft, along with its third-party consultants, completed and filed an Initial Assessment Technical Report Summary for the Hycroft Mine (the 2022 Hycroft TRS ) with an effective date of February 18, 2022 and prepared in accordance with the SEC s Modernization Rules of Property Disclosures for Mining Registrants as set forth in subpart 1300 of Regulation S-K ( Modernization Rules ). The 2022 Hycroft TRS provides an Initial Assessment of the mineral resource estimate utilizing a milling and acid pressure oxidation ( Acid POX ) process for sulfide mineralization and heap leaching process for oxide and transition mineralization. As a result of the milling and Acid POX process presented in the 2022 Hycroft TRS, as compared to the novel two-step oxidation and heap leap process presented in the Hycroft Technical Report Summary, Heap Leaching Feasibility Study, prepared in accordance with the requirements of the Modernization Rules, with an effective date of July 31, 2019 (the 2019 Hycroft TRS ), and the associated fundamental changes to the assumptions underlying the 2019 Hycroft TRS also prepared in accordance with the requirements of the Modernization Rules, the 2022 Hycroft TRS supersedes and replaces the 2019 Hycroft TRS and the 2019 Hycroft TRS and information from such 2019 Hycroft TRS should no longer be relied upon. Our ongoing disclosures and many of management estimates and judgements will be based on the 2022 Hycroft TRS and not the 2019 Hycroft TRS. The Company will continue to build on the work to date and investigate opportunities identified through progressing the technical and data analyses leading up to the 2022 Hycroft TRS and will provide an updated technical report at an appropriate time. During the year ended December 31, 2021 we sold 56,045 ounces of gold and 397,546 ounces of silver. As of December 31, 2021, the Hycroft Mine had measured and indicated mineral resources of 9.6 million ounces of gold and 446.0 million ounces of silver and inferred mineral resources of 5.0 million ounces of gold and 150.4 million ounces of silver, which are contained in oxide, transitional, and sulfide ores.
+Our corporate headquarters is located at 4300 Water Canyon Road, Unit 1 Winnemucca, Nevada 89445, and our telephone number is (775) 304-0260. Our website is www.hycroftmining.com. For more information about Hycroft, please see the sections entitled Description of Business, Description of Property, Management s Discussion and Analysis of Financial Conditions and Results of Operation, Management and Executive Compensation in this prospectus.
+Company History
+Seller was incorporated as Allied Nevada Gold Corp. under the laws of the State of Delaware on September 14, 2006 and commenced operations on May 10, 2007. Seller suspended mining operations at the Hycroft Mine on July 8, 2015 to maximize cash flow and minimize spending through the remainder of the chapter 11 process and changed its name from Allied Nevada Gold Corp. to Hycroft Mining Corporation on October 9, 2015 in connection with its restructuring and emergence from federal bankruptcy proceedings. Seller continued to process and produce gold and silver through the operation of the heap leach pads and Merrill-Crowe processing plants located on the property, but in 2017, with revenue no longer covering the cost of the reagents necessary for production, the Hycroft Mine was placed into care and maintenance mode to minimize expenditures and conserve cash. While in care and maintenance, gold and silver production was a byproduct of maintenance activities.
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+Recapitalization Transaction with MUDS
+On May 29, 2020, we, formerly known as Mudrick Capital Acquisition Corporation ( MUDS ), consummated a business combination transaction (the Recapitalization Transaction ) that resulted in MUDS Acquisition Sub, Inc. ( Acquisition Sub ) acquiring all of the issued and outstanding equity interests of the direct subsidiaries of Hycroft Mining Corporation ( Seller ) and substantially all of the other assets of Seller and assuming substantially all of the liabilities of Seller. In conjunction with the Recapitalization Transaction, Seller s indebtedness existing prior to the Recapitalization Transaction was either repaid, exchanged for indebtedness of the Company, exchanged for shares of common stock or converted into shares of Seller common stock, and our post-Recapitalization Transaction indebtedness included amounts drawn under the Credit Agreement among MUDS, MUDS Holdco Inc., Allied VGH LLC, Hycroft Mining Holding Corporation, Hycroft Resources and Development, LLC Sprott Private Resource Lending II (Collector) Inc., and Sprott Resources Lending Corp. ( Sprott Credit Agreement ) and the assumption of the newly issued Assumed New Subordinated Notes.
+Our Properties
+All of our mining properties are located in Nevada. Our one property is the Hycroft Mine, as discussed herein, at which we ceased active mining operations in November 2021.
+Recent Developments
+COVID-19
+In March 2020, the World Health Organization declared the outbreak of a novel coronavirus ( COVID-19 ) as a pandemic, which continues to spread throughout the United States with new variants of the virus. Efforts implemented by local and national governments, as well as businesses, including temporary closures, have had adverse impacts on local, national and global economies. We have implemented health and safety policies and protocols for employees, contractors, and visitors that follow guidelines published by the Center for Disease Control ( CDC ) and the Mine Safety and Health Administration ( MSHA ). During 2021, and the fourth quarter of 2020, our operations were limited by COVID-19 related absences, however the impact while negative, did not materially and adversely affect our operations. The extent of the impact of COVID-19 on our operational and financial performance going forward will depend on certain developments, including but not limited to the duration and continued spread of the outbreak and strand mutations, the availability and use of vaccines, the development of therapeutic drugs and treatments, and the direct and indirect impacts on our employees, vendors, and customers, all of which are uncertain and cannot be fully anticipated or predicted. Since the Hycroft Mine represents the entirety of our operations, any further COVID-19 outbreaks at the mine site or any governmental restrictions implemented to combat the pandemic could result in a partial or an entire shutdown of the Hycroft Mine itself, which would adversely impact our financial position, operating results, and cash flows.
+During the year ended December 31, 2021, the site continued to manage COVID-19 control restrictions in accordance with state, national, and CDC guidelines and will continue to monitor and follow those guidelines going forward.
+To date, COVID-19 related absences have limited our operations from time-to-time but did not materially disrupt our operations. Additionally, we have not experienced any material disruptions to our supply chain because of COVID-19. However, we can provide no assurance that our operations will not be materially adversely affected by the COVID-19 pandemic in the future that could result from any worsening of the pandemic, the effect of mutating strains, additional outbreaks of the pandemic, actions taken to contain the pandemic s spread or treat its impact, continued availability of vaccines, and their distribution, acceptance and efficacy, and governmental, business and individual actions taken in response to the pandemic including government-imposed regulations regarding, among other things, COVID-19 testing, vaccine mandates and related workplace restrictions.
+Mineral Resource Update
+Gold equivalent mineral resources totaled 15.5 million ounces of measured and indicated and 6.9 million ounces of inferred. For this study, Independent Mining Consultants, Inc. ( IMC ) developed the Hycroft Mine resource block model which includes data from 1981 to 2018 and includes 5,501 holes, representing 2,482,722 ft of drilling. The current inflationary environment and change in processing technique has resulted in increased cost assumptions and an associated higher cut-off grade partially mitigated by higher recoveries leading to a change in the mineral resource estimate, when compared with the prior model.
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+The mineral resources were estimated based upon results of the 2022 Hycroft TRS, as conducted in accordance with the Modernization Rules. With the issuance of the 2022 Hycroft TRS reflecting a different mining process, the 2019 Hycroft TRS is superseded and the 2019 Hycroft TRS and information from such 2019 Hycroft TRS should no longer be relied upon.
+2022 Private Placement
+On March 14, 2022, the Company entered into subscription agreements (the Subscription Agreements and each a Subscription Agreement ) with each of American Multi-Cinema, Inc. ( AMC ) and 2176423 Ontario Limited, an entity affiliated with Eric Sprott ( Eric Sprott and together with AMC, the Purchasers ), pursuant to which the Company agreed to sell to the Purchasers, in a private placement, an aggregate of 46,816,480 units ( Units ) at a purchase price per Unit of $1.193, with each Unit consisting of one share of the Common Stock and one New Warrant to purchase one share of Common Stock and the shares issuable upon exercise of the New Warrants (the Warrant Shares ), providing for a total purchase price of approximately $55.9 million (the 2022 Private Placement ). The New Warrants issued in the 2022 Private Placement have an exercise price of $1.068 per Warrant Share, and will expire five years after issuance.
+The closing of the sales of securities pursuant to the Subscription Agreements occurred on March 15, 2022 for gross proceeds to the Company of approximately $55.9 million before deducting expenses incurred in connection with the 2022 Private Placement. The Company intends to use the proceeds for general corporate purposes, which may include the repayment, refinancing, redemption or repurchase of existing indebtedness, working capital or capital expenditures and other investments, which may include additional technical evaluations and studies, advancement of the Initial Assessment in the 2022 Hycroft TRS to a pre-feasibility and/or feasibility study and additional exploration at the Hycroft Mine.
+The Subscription Agreement with AMC, as amended as of April 8, 2022, also provided AMC with the right to appoint a director to the Company s board of directors (the Board ) and the Company agreed to support such director s nomination so long as AMC retains at least 50% of the Common Stock purchased under the Subscription Agreement with AMC and such ownership constitutes at least 5% of the voting power of the Company s voting securities.
+As part of the Subscription Agreements, the Company is required to file this registration statement, of which this prospectus forms a part, with the SEC, following the filing of the Annual Report on Form 10-K for the year ended December 31, 2021 (the 2021 Form 10-K ) to register the Common Stock, New Warrants and Warrant Shares for sale under the Securities Act.
+Agreement with Sprott Private Resource Lending II (Collector), LP
+On November 10, 2021, the Company entered into a waiver with Sprott Private Resource Lending II (Collector) (the Lender ) of certain provisions of the Sprott Credit Agreement effective November 10, 2021 (the November 2021 Waiver ). Pursuant to the November 2021 Waiver, the Lender permitted the Company to cease active mining operations and to reduce the amount of unrestricted cash required to be maintained by the Company from not less than $10.0 million to not less than $9.0 million for the period ending May 10, 2022.
+On February 28, 2022 the Company entered into a waiver and amendment agreement with the Lender and Sprott Private Resource Lending II (Co) Inc. (the February 2022 Waiver and Amendment ) amending the November 2021 Waiver and requiring that the Company maintain at least $7.5 million of unrestricted cash on the last day of February 2022 and at least $9.0 million of unrestricted cash on the last day of each month thereafter during the waiver period, waived all obligations of the Company to prepay the facility with the net cash proceeds of any mill asset sales until the earlier of the date on which the Company completes a private placement or other offering or issuance of its equity securities and March 31, 2022, and extended the payment due date for the February additional interest payment and the February principal payment until the earlier of any such offering date and March 31, 2022.
+On March 11, 2022, the Company entered into an agreement (the March 2022 Sprott Agreement ) with the Lender with respect to the Amended and Restated Credit Agreement, dated as of May 29, 2020 (as amended, restated, supplemented or otherwise modified from time to time, the Sprott Credit Agreement ) among the Company, the Lender, the Guarantors (as defined in the Sprott Credit Agreement) and the other parties thereto. As described in the March 2022 Sprott Agreement, the Company was contemplating the sale or issuance of its equity securities pursuant to one or more transactions to be completed on or before March 31, 2022 (the Equity Financing Transactions ). Pursuant to the March 2022 Sprott Agreement, if the Equity Financing Transactions result (or are likely to result pursuant to definitive subscription underwriting and/or similar legally binding agreements) in the Company s receipt of total 
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+gross cash proceeds (before deduction of fees and expenses) of at least $50 million on or before March 31, 2022 (the Required Equity Amount ), the Lender and the Company agreed to amend the principal repayment terms under the Sprott Credit Agreement such that no further scheduled payments of principal shall be required prior to May 31, 2025 (the Maturity Date ) (i.e., there will be no required regular amortization payments of the Facility (as defined in the Sprott Credit Agreement) and the full principal balance of the facility shall be due and payable in a single bullet payment on the Maturity Date). The consummation of the 2022 Private Placement as described under 2022 Private Placement above satisfied the Required Equity Amount condition in the March 2022 Sprott Agreement.
+The March 2022 Sprott Agreement also provided that, in connection with the modification of the required facility amortization payments, the Company shall pay in-kind to the Lender an amount equal to $3.3 million, with such amount to be capitalized and added to the principal amount owing under the Sprott Credit Agreement and accrue interest at the same rate and upon the same terms as the existing loans under the Sprott Credit Agreement; provided, the payment or prepayment of such capitalized principal amount shall not be subject to the Prepayment Premium (as defined in the Sprott Credit Agreement) or any other penalty or premium.
+Second Amendment and Restatement of Sprott Credit Agreement
+On March 14, 2022, the Company reached an agreement in principle with the Lender to modify the terms of the Sprott Credit Agreement and other applicable loan documents. On March 30, 2022, the Company and Lender under the Sprott Credit Agreement entered into the Second Amended and Restated Credit Agreement dated March 30, 2022 ( Second A&R Agreement ), which (a) extended the maturity date for all of the loans and other principal obligations under the Sprott Credit Facility (as such term is defined in the Second A&R Agreement) by two years, to May 31, 2027; (b) provided for the Company to prepay principal under the Sprott Credit Facility in the amount of $10.0 million promptly upon the Company s receipt of cash proceeds from the 2022 Private Placement offering with AMC and Eric Sprott (the Initial Equity Proceeds Prepayment ); (c) provided for the Company to prepay principal under the Second A&R Agreement in the amount of $13.9 million (representing 10% of the subsequent issuance of its equity interests consummated on or prior to March 31, 2022) (the Subsequent Equity Proceeds Prepayments ); and (d) eliminated the prepayment premiums otherwise payable with respect to the Initial Equity Proceeds Prepayment, the Subsequent Equity Proceeds Prepayments and all future prepayments of principal under the Sprott Credit Facility. In addition, the Company s obligations (i) to prepay principal with proceeds of asset sales will be credited/offset by the $23.9 million aggregate amount of Initial Equity Proceeds Prepayment and the Subsequent Equity Proceeds Prepayments, and (ii) to maintain a minimum amount of Unrestricted Cash (as defined in the Second A&R Agreement) was increased to $15.0 million. Pursuant to the agreement in principal, the Company made the Initial Equity Proceeds Prepayment of $10.0 million and paid in kind a $3.3 million fee in connection with the modification and capitalized it to principal on March 16, 2022 and following the execution of the Second A&R Agreement on March 30, 2022, the Company (i) paid the previously deferred additional interest payment of $0.5 million, and (ii) made the Subsequent Equity Proceeds Prepayment of $13.9 million. After giving effect to such prepayments the outstanding principal balance under the Second A&R Agreement was estimated as of March 31, 2022 to be $57.9 million (before issuance discounts) including unpaid additional interest of approximately $7.1 million.
+Subsequent to the execution and delivery of the Second A&R Agreement, it was discovered that Sections 2.9 and 2.10 of the Sprott Credit Agreement erroneously referred to the Maturity Date as the date through which Additional Interest (as defined in the Second A&R Agreement) is to be incurred by the Company. The actual intention and understanding of each of the parties was that Additional Interest under the Sprott Credit Agreement (as amended by the Second A&R Agreement) would only be incurred through the original maturity date of May 31, 2025. On May 14, 2022, the Company, Lender and the other parties to the Second A&R Agreement entered into a Letter Agreement with amended Sections 2.9 and 2.10 of the Second A&R Agreement by replacing each reference to the Maturity Date with May 31, 2025 .
+At-the-market Offering of Common Stock
+On March 15, 2022, the Company implemented an at-the-market offering program ( ATM Program ) by entering into an At Market Issuance Sales Agreement (the Sales Agreement ) with B. Riley Securities, Inc. (the Agent ). Under the terms of the Sales Agreement, the Company had the right from time to time to or through the Agent, acting as sales agent or principal, to offer and sell shares of the Company s common stock having a gross sales price of up to $500 million. The compensation payable to the Agent for sales of shares of Common Stock pursuant to the Sales Agreement was equal to 3.0% of the gross sales price for any shares of Common Stock sold through the ATM Program by Agent as sales agent under the Sales Agreement. Shares sold under the Sales 
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+Agreement, were issued pursuant to the Company s shelf registration statement on Form S-3 (No. 333-257567) that the SEC declared effective on July 13, 2021, including the prospectus, dated July 13, 2021, and the prospectus supplement, dated March 15, 2022.
+On March 25, 2022, the Company announced that it had terminated the ATM Program having sold 89,553,602 shares of common stock and generated aggregate gross proceeds, before commissions and offering expenses, of approximately $138.6 million.
+Amendment to the 10% Senior Secured Notes and Note Exchange Agreement
+On March 14, 2022, the Company entered into an amendment to the 10% Senior Secured Notes and Note Exchange Agreement (the Note Amendment ), with (i) certain direct and indirect subsidiaries of the Company as Guarantors; (ii) holders of the 10% Senior Secured Notes (the Assumed New Subordinated Notes ), including certain funds affiliated with, or managed by, Mudrick Capital Management, L.P., Whitebox Advisors, LLC, Highbridge Capital Management, LLC, Aristeia Capital, LLC and Wolverine Asset Management, LLC (collectively, the Amending Holders ), and (iii) Wilmington Trust, National Association, in its capacity as collateral agent. The Note Amendment amended the Note Exchange Agreement, dated as of January 13, 2020 (the Note Exchange Agreement ), and the Assumed New Subordinated Notes issued thereunder in order to extend the maturity date of the Assumed New Subordinated Notes from December 1, 2025 to December 1, 2027. The Note Amendment also removed the requirements that a holder receive the consent of the Company and the other holders in order to transfer any Note. The Amending Holders constituted all of the holders of the Assumed New Subordinated Notes. The Note Amendment became effective upon the closing of the 2022 Private Placement upon receipt of $55.9 million gross cash proceeds (before deduction of fees and expenses).
+Amendment to the Company s Second Amended and Restated Certificate of Incorporation
+On March 11, 2022, the Board approved an amendment to the Company s Second Amended and Restated Certificate of Incorporation increasing the number of authorized shares of the Common Stock by 1,000,000,000 to a total of 1,400,000,000 (the Certificate of Incorporation Amendment ) and directed that the Certificate of Incorporation Amendment be submitted for consideration by the Company s stockholders. On March 15, 2022, AMC, Eric Sprott, and entities affiliated with Mudrick Capital, which together constituted the holders of a majority of the Common Stock, approved the Certificate of Incorporation Amendment by written consent. The Certificate of Incorporation Amendment will not become effective until 20 days after the Company distributes an Information Statement on Schedule 14C to the stockholders of the Company. The Company commenced mailing of the Information Statement on Schedule 14C to the stockholders of the Company on April 1, 2022 and filed the Certificate of Incorporation Amendment with the Secretary of State of Delaware on April 22, 2022, at which time it became effective.
+Risk Factors
+You should carefully review and consider the following risk factors described in the section entitled Risk Factors, and the other information contained in this prospectus. Investing in our Common Stock or Warrants is speculative and involves a high degree of risk due to the nature of our business and the present stage of exploration and advancement of our mineral properties. We may face additional risks and uncertainties that are not presently known to us, or that we currently deem immaterial, which may also impair our business or financial condition. If any of those risks actually occur, our business, financial condition and results of operations would suffer. The risks discussed below also include forward-looking statements, and our actual results may differ substantially from those discussed in these forward-looking statements. See also Cautionary Statement Regarding Forward-Looking Statements in this prospectus.
+Summary of Risk Factors:
+The following list provides a summary our risk factors discussed in further detail below:
+Risks related to changes in our operations at the Hycroft Mine, including:
+ Risks associated with cessation of mining operations at the Hycroft Mine;
+ Uncertainties concerning estimates of mineral resources;
+ Risks relating to a lack of a completed pre-feasibility or feasibility study; and
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+ Risks related to our ability to re-establish commercially feasible mining operations.
+Industry-related risks including:
+ Fluctuations in the prices of gold and silver;
+ Uncertainties relating to the COVID-19 pandemic;
+ The intense competition in the recruitment and retention of qualified employees within the mining industry;
+ The commercial success of, and risks relating to, our development activities;
+ Uncertainties and risks related to our reliance on contractors and consultants;
+ Availability and cost of equipment, supplies, energy, or commodities;
+ The inherently hazardous nature of mining activities, including environmental risks;
+ Potential effects of U.S. federal and state governmental regulations, including environmental regulation and permitting requirements;
+ Uncertainties relating to obtaining or retaining approvals and permits from governmental regulatory authorities;
+ Cost of compliance with current and future government regulations, including environmental regulations;
+ Potential challenges to title in our mineral properties;
+ Our insurance may not be adequate to cover all risks associated with our business;
+ Risks associated with proposed legislation could significantly increase the cost of mine development on our unpatented mining claims;
+ Risks associated with regulations and pending legislation governing issues involving climate change could result in increased costs, which could have a material adverse effect on our business; and
+ Changes to the climate and regulations regarding climate change.
+Business-related risks including:
+ Risks related to our ability to raise capital on favorable terms or at all;
+ The loss of key personnel or our failure to attract and retain personnel;
+ Risks related to our substantial indebtedness, including operating and financial restrictions under existing indebtedness, cross acceleration and our ability to generate sufficient cash to service our indebtedness;
+ Risks related to having sufficient liquidity to service our indebtedness without a material cash flow;
+ The costs related to our land reclamation requirements;
+ Risks related to technology systems and security breaches;
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+ The transition away from the London Interbank Offered Rate ( LIBOR ) could have an adverse impact on us;
+ Possible litigation as a result of a failure to remediate a material weakness in our internal controls over financial reporting; and
+ Risks that our principal stockholders will be able to exert significant influence over matters submitted to stockholders for approval.
+Risks related to our Common Stock and Warrants, including:
+ Volatility in the price of our Common Stock and Warrants;
+ Risks relating to a potential dilution as a result of future equity offerings;
+ Risks relating to a short squeeze resulting in sudden increases in demand for our Common Stock;
+ Risks relating to information published by third parties about us that may not be reliable or accurate;
+ Risks associated with changes in interest rates;
+ Volatility in the price of our Common Stock could subject us to securities litigation;
+ Risks associated with our current plan not to pay dividends;
+ Risks associated with future offerings of senior debt or equity securities;
+ Risks related to delisting by Nasdaq;
+ Risks Warrants may expire worthless and that certain Warrants are being accounted for as a liability;
+ Anti takeover provisions could make a third-party acquisition of us difficult; and
+ Risks related to limited access to our financial information, as we have elected to take advantage of the disclosure requirement exemptions granted to emerging growth companies and smaller reporting companies.
+You should carefully review and consider the risk factors set forth under the section entitled Risk Factors beginning on page 20 of this prospectus.
+Implications of Being an Emerging Growth Company
+We qualify as an emerging growth company as defined in the Jumpstart our Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of specified reduced requirements and is relieved of certain other significant requirements that are otherwise generally applicable to public companies. As an emerging growth company:
+ we may present only two years of audited financial statements and only two years of related Management s Discussion & Analysis of Financial Condition and Results of Operations;
+ we are exempt from the requirement to obtain an attestation report from our auditors on the assessment of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002;
+ we are permitted to provide less extensive disclosure about our executive compensation arrangements; and
+ we are not required to give our stockholders non-binding votes on executive compensation or golden parachute arrangements.
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+We may take advantage of these provisions for up to five full fiscal years or such earlier time that we are no longer an emerging growth company. We may choose to take advantage of some but not all of these reduced burdens. We would cease to be an emerging growth company if we have more than $1 billion in annual revenues, have more than $700 million in market value of our shares of common stock held by non-affiliates, or issue more than $1 billion of non-convertible debt over a three-year period. The Company has elected not to opt out of the extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.
+Corporate Information
+We were incorporated on August 28, 2017 as a Delaware corporation under the name Mudrick Capital Acquisition Corporation and formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. On May 29, 2020, in connection with the consummation of the Recapitalization Transaction, we changed our name to Hycroft Mining Holding Corporation .
+Our corporate headquarters is located at 4300 Water Canyon Road, Unit 1 Winnemucca, Nevada 89445, and our telephone number is (775) 304-0260. Our website is www.hycroftmining.com. The information found on, or that can be accessed from or that is hyperlinked to, our website is not part of this prospectus.
+THE OFFERING
+We are registering the issuance by us of up to 94,258,841 shares of our Common Stock that may be issued by us upon exercise of the Warrants to purchase Common Stock, including the public warrants, private placement warrants, forward purchase warrants, PIPE warrants, Seller warrants, October 2022 warrants and New Warrants. We are also registering the resale by the Selling Securityholders or their permitted transferees of (i) up to 71,211,526 shares of Common Stock, and (ii) up to 60,125,009 warrants to purchase Common Stock, including the private placement warrants, forward purchase warrants, PIPE warrants, October 2022 warrants and New Warrants. Any investment in the securities offered hereby is speculative and involves a high degree of risk. You should carefully consider the information set forth under Risk Factors on page 20 of this prospectus.
+As of May 13, 2022, we had 197,029,741 shares of Common Stock outstanding.
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+Issuance of Securities - Common Stock and Warrants
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+Shares of Common Stock to be issued upon exercise of outstanding Warrants
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+94,258,841 shares
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+Use of proceeds
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+We could receive up to an aggregate of approximately $688.8 million from the exercise of all outstanding Warrants, assuming the exercise in full of all such Warrants for cash. Unless we inform you otherwise in a prospectus supplement, we intend to use the net proceeds from the exercise of such Warrants for general corporate purposes which may include repayment of outstanding indebtedness, working capital, exploration and development, acquisitions or other strategic investments.
+ 
+
+Resale of Common Stock and Warrants
+ 
+ 
+ 
+
+Shares of Common Stock offered by the Selling Securityholders
+ 
+71,211,526
+ 
+
+Warrants offered by the Selling Securityholders
+ 
+ 
+ 
+
+Private placement warrants, forward purchase warrants, PIPE warrants, October 2020 warrants and New Warrants
+ 
+60,125,009
+ 
+
+Exercise Price for private placement warrants, forward purchase warrants and PIPE warrants
+ 
+$11.50 per share of Common Stock
+ 
+
+Exercise Price for October 2020 warrants
+ 
+$10.50 per share of Common Stock
+ 
+
+Exercise Price for New Warrants
+ 
+$1.068 per share of Common Stock
+ 
+
+Use of proceeds
+ 
+We will not receive any proceeds from the sale of the Common Stock and Warrants to be offered by the Selling Securityholders. With respect to shares of Common Stock underlying the Warrants, we will not receive any proceeds from the sale of such shares except with respect to amounts received by us upon exercise of such Warrants to the extent such Warrants are exercised for cash.
+ 
+
+ 
+ 
+ 
+ 
+
+NASDAQ Ticker Symbols
+ 
+Common Stock: HYMC
+Public Warrants: HYMCW
+October 2020 warrants: HYMCL
+Seller warrants: HYMCZ
+ 
+
+ 
+ 
+ 
+ 
+
+-19-
+
+Table of Contents
+
+RISK FACTORS
+Investing in our securities involves a high degree of risk. Investors should carefully consider the risks described below and all of the other information set forth in the registration statement of which this prospectus forms a part, including our financial statements and related notes and Management s Discussion and Analysis of Financial Condition and Results of Operations, before deciding to invest in our Common Stock or Warrants. If any of the events or developments described below occur, our business, financial condition, or results of operations could be materially or adversely affected. As a result, the market price of our Common Stock and Warrants could decline, and investors could lose all or part of their investment. The risks and uncertainties described below are not the only risks and uncertainties that we face. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also impair our business operations. The risks discussed below also include forward-looking statements, and our actual results may differ substantially from those discussed in these forward-looking statements. See Cautionary Notes Regarding Forward-Looking Statements above.
+Summary of Risk Factors:
+The following list provides a summary our risk factors discussed in further detail below:
+Risks related to changes in our operations at the Hycroft Mine, including:
+ Risks associated with cessation of mining operations at the Hycroft Mine;
+ Uncertainties concerning estimates of mineral resources;
+ Risks relating to a lack of a completed pre-feasibility or feasibility study; and
+ Risks related to our ability to re-establish commercially feasible mining operations.
+Industry-related risks including:
+ Fluctuations in the prices of gold and silver;
+ Uncertainties relating to the COVID-19 pandemic;
+ The intense competition in the recruitment and retention of qualified employees within the mining industry;
+ The commercial success of, and risks relating to, our development activities;
+ Uncertainties and risks related to our reliance on contractors and consultants;
+ Availability and cost of equipment, supplies, energy, or commodities;
+ The inherently hazardous nature of mining activities, including environmental risks;
+ Potential effects of U.S. federal and state governmental regulations, including environmental regulation and permitting requirements;
+ Uncertainties relating to obtaining or retaining approvals and permits from governmental regulatory authorities;
+ Cost of compliance with current and future government regulations, including environmental regulations;
+ Potential challenges to title in our mineral properties;
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+Table of Contents
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+ Our insurance may not be adequate to cover all risks associated with our business;
+ Risks associated with proposed legislation could significantly increase the cost of mine development on our unpatented mining claims;
+ Risks associated with regulations and pending legislation governing issues involving climate change could result in increased costs, which could have a material adverse effect on our business; and
+ Changes to the climate and regulations regarding climate change.
+Business-related risks including:
+ Risks related to our ability to raise capital on favorable terms or at all;
+ The loss of key personnel or our failure to attract and retain personnel;
+ Risks related to our substantial indebtedness, including operating and financial restrictions under existing indebtedness, cross acceleration and our ability to generate sufficient cash to service our indebtedness;
+ Risks related to having sufficient liquidity to service our indebtedness without a material cash flow;
+ The costs related to our land reclamation requirements;
+ Risks related to technology systems and security breaches;
+ The transition away from the London Interbank Offered Rate ( LIBOR ) could have an adverse impact on us;
+ Possible litigation as a result of a failure to remediate a material weakness in our internal controls over financial reporting; and
+ Risks that our principal stockholders will be able to exert significant influence over matters submitted to stockholders for approval.
+Risks related to our Common Stock and Warrants, including:
+ Volatility in the price of our Common Stock and Warrants;
+ Risks relating to a potential dilution as a result of future equity offerings;
+ Risks relating to a short squeeze resulting in sudden increases in demand for our Common Stock;
+ Risks relating to information published by third parties about us that may not be reliable or accurate;
+ Risks associated with changes in interest rates;
+ Volatility in the price of our common stock could subject us to securities litigation;
+ Risks associated with our current plan not to pay dividends;
+ Risks associated with future offerings of senior debt or equity securities;
+ Risks related to delisting by Nasdaq;
+
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+ Risks Warrants may expire worthless and that certain Warrants are being accounted for as a liability;
+ Anti takeover provisions could make a third-party acquisition of us difficult; and
+ Risks related to limited access to our financial information, as we have elected to take advantage of the disclosure requirement exemptions granted to emerging growth companies and smaller reporting companies.
+Risks Related to Changes in Hycroft Mine Operations
+We have mineral resources at the Hycroft Mine but they may not be brought into production.
+We are not currently conducting commercial mining operations at the Hycroft Mine. There is no certainty that the mineral resources estimated at the Hycroft Mine will be mined or, if mined, processed profitably. We have no specific plans and cannot currently predict when we will be able to bring the Hycroft Mine back into production. The commercial viability of the Hycroft Mine is dependent on a number of factors, including metal prices, the availability of and ability to raise capital for development, government policy and regulation and environmental protection, which are beyond our control. We may not generate commercial-scale revenues until we bring the Hycroft Mine back into production.
+The figures for our mineral resources are estimates based on interpretation and assumptions and the properties may yield less mineral production or less profit under actual conditions than is currently estimated.
+Unless otherwise indicated, mineral resource figures in our filings with the SEC, press releases and other public statements that may be made from time to time are based upon estimates made by our personnel and independent geologists. These estimates are imprecise and depend upon geologic interpretation and statistical inferences drawn from drilling and sampling analysis, which may prove to be inaccurate. There can be no assurance that mineral resource or other mineralization figures will be accurate or that this mineralization could be mined or processed profitably.
+Because we have not completed a feasibility study or recommenced commercial production at the Hycroft Mine, mineral resource estimates for our properties may require adjustments or downward revisions based upon further exploration or advancement work or actual production experience. In addition, the grade of ore ultimately mined, if any, may differ from that indicated by drilling results. There can be no assurance that recovery of minerals in small-scale tests will be duplicated in large-scale tests under on-site conditions or in production scale.
+Until mineral resources are mined and processed, the quantity of ore and grades must be considered as an estimate only. In addition, the quantity of mineral resources may vary depending on metal prices, which largely determine whether mineral resources are classified as ore (economic to mine) or waste (uneconomic to mine). Current mineral resource estimates were calculated using sales prices of $1,800 per ounce of gold and $23.00 per ounce of silver. A material decline in the current price of gold or silver or material changes in our processing methods or cost assumptions could require a reduction in our mineral resource estimates. Any material reductions in estimates of mineral resources, or of our ability to upgrade these mineral resources to mineral reserves and extract these mineral resources, could have a material adverse effect on the our prospects and could restrict our ability to successfully implement our strategies for long-term growth. In addition, we can provide no assurance that gold and silver recoveries experienced in small-scale laboratory tests will be duplicated in larger scale tests under on-site conditions or during production.
+We have not completed a feasibility study for the proposed processing method for the Hycroft Mine and actual capital costs, operating costs, production and economic returns may differ significantly from those the Company has anticipated. There are no assurances future advancement activities by the Company, if any, will lead to a favorable feasibility study or profitable mining operations.
+We have completed and issued the 2022 Hycroft TRS with an effective date of February 18, 2022 which was prepared in accordance with the SEC s Modernization Rules and which replaced the prior 2019 Hycroft TRS, prepared in accordance with the Modernization Rules. The 2022 Hycroft TRS is an Initial Assessment and is not a feasibility study for the Hycroft Mine. Typically a 
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+company will not make a production decision until it has completed a feasibility study. Feasibility studies derive estimates of cash operating costs based upon, among other things:
+ anticipated tonnage, grades and metallurgical characteristics of the mineral reserves to be mined and processed;
+ anticipated recovery rates of gold and other metals from the mineral reserves;
+ cash operating costs of comparable facilities and equipment; and
+ anticipated climatic conditions and environmental protection measures.
+Completing a feasibility study of the Hycroft Mine will require significant additional work and study in order to reduce the range of uncertainty associated with the study s estimates and conclusions. Cash operating costs, production and economic returns, and other estimates contained in studies or estimates prepared by or for us may differ significantly from those anticipated by us and estimated costs as they are developed if too high may result in further delays or cancellation of advancement at the Hycroft Mine.
+There is no certainty that a feasibility study for the Hycroft Mine will be completed or, if completed, that it will result in sufficiently favorable estimates of the economic viability of the Hycroft Mine to justify a construction decision.
+We may not be able to successfully re-establish mining operations or profitably produce precious metals.
+We currently have no ongoing commercial mining operations or sustaining revenue from the care and maintenance processing operations currently conducted at the Hycroft Mine. Mineral exploration and advancement involves a high degree of risk and few properties that are explored are ultimately developed into producing mines. The future advancement of the Hycroft Mine will require obtaining permits and financing and the construction and operation of the mine, processing plants and related infrastructure. Our ability to establish mining operations or profitably produce precious metals from the Hycroft Mine will be affected by:
+ timing and cost, which can be considerable, of the construction of additional mining and processing facilities;
+ availability and costs of skilled labor and mining equipment;
+ availability and cost of appropriate smelting and/or refining arrangements;
+ need to obtain necessary additional environmental and other governmental approvals and permits, and the timing of those approvals and permits;
+ availability of funds to finance equipment purchases, construction and advancement activities;
+ management of an increased workforce and co-ordination of contractors;
+ potential opposition from non-governmental organizations, environmental groups, or local groups which may delay or prevent advancement activities; and
+ potential increases in construction and operating costs due to changes in the cost of fuel, power, labor, materials and supplies and foreign exchange rates.
+It is common in new mining operations to experience unexpected problems and delays during advancement, construction, start-up commissioning, and transition to commercial operations. In addition, delays in the commencement of mineral production often occur. Accordingly, there are no assurances that, if we decide to initiate construction or mining activities, that we will be able to successfully establish mining operations or profitably produce gold and silver at the Hycroft Mine.
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+Industry-Related Risks
+The market prices of gold and silver are volatile. A decline in gold and silver prices could result in decreased revenues, decreased net income, increased losses and decreased cash inflows which may negatively affect our business.
+Gold and silver are commodities. Their prices fluctuate and are affected by many factors beyond our control, including interest rates, expectations regarding inflation, speculation, currency values, central bank activities, governmental decisions regarding the disposal of precious metals stockpiles, global and regional demand and production, political and economic conditions and other factors. The prices of gold and silver, as quoted by The London Bullion Market Association on May 13, 2022, December 31, 2021 and December 31, 2020, were $1,812, $1,820 and $1,891 per ounce for gold, respectively, and $20.84, $23.09 and $26.49 per ounce for silver, respectively. The prices of gold and silver may decline in the future. A substantial or extended decline in gold or silver prices would adversely impact our financial position, revenues, net income and cash flows, particularly in light of our current strategy of not engaging in hedging transactions with respect to gold or silver. In addition, sustained lower gold or silver prices may adversely affect our business, including:
+ halt, delay, modify, or cancel plans for the mining of oxide, transitional, and sulfide ores or the development of new and existing projects;
+ reduce existing mineral resources by removing ores from mineral resources that can no longer be economically processed at prevailing prices; and
+ cause us to recognize an impairment to the carrying values of long-lived assets.
+The COVID-19 pandemic may adversely impact our business and financial condition.
+The COVID-19 pandemic has caused, and is expected to continue to cause, disruptions in regional economies and the world economy and financial and commodity markets in general. The transmission of COVID-19 and efforts to contain its spread have resulted in international, national and local border closings, travel restrictions, significant disruptions to business operations, supply chains and customer activity and demand, service cancellations, workforce reductions and other changes, significant challenges in healthcare service provision and delivery, mandated closures and quarantines, as well as considerable general concern and uncertainty, all of which have negatively affected the economic environment and may in the future have further and larger impacts. The full extent of the impact of the pandemic on the economy and commodity prices, including gold and silver prices, is not known at this time and it is not known what measures will be implemented by governmental authorities in the future and how long these measures, or the measures currently in effect, will be in place. The COVID-19 global pandemic and efforts to reduce its spread have led to a significant decline of economic activity and significant disruption and volatility in global markets. Additionally, COVID-19 has disrupted the capital markets world-wide and commodity prices, including gold prices, and we may be unable to complete future capital raising transactions if continued concerns relating to COVID-19 cause further significant market disruptions. We cannot at this time predict the duration of the coronavirus pandemic or the impact of government regulations that might be imposed in response of the pandemic; however, the coronavirus pandemic may have a material adverse effect on our business, financial position, results of operations and cash flows.
+We face intense competition in the recruitment and retention of qualified employees.
+The mining industry is intensely competitive for employees and includes several large established mining companies with substantial mining capabilities and with greater financial and technical resources than ours. We compete with other mining companies in the recruitment and retention of qualified managerial and technical employees. If we are unable to successfully attract and retain qualified employees, our exploration and development programs and/or our care and maintenance operations may be slowed down or suspended, which may adversely impact our development, financial condition and results of operations and our ability to raise additional capital.
+ 
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+We cannot be certain that our future development activities will be commercially successful.
+Substantial expenditures are required to construct and operate the Hycroft Mine including additional equipment and infrastructure such as is typically seen in a milling and Acid POX plant to allow for extraction of gold and silver from the sulfide mineral resource, to further develop our Hycroft Mine to establish mineral reserves and identify new mineral resources through drilling and analysis. In 2022, our current plan is to continue to advance the Acid POX evaluation reflected in the Initial Assessment in the 2022 Hycroft TRS. In conjunction with that Initial Assessment, we intend to focus much of our technical efforts for 2022 on, among other things, (1) completing metallurgical testing including bench top autoclave tests and review the results thereof; (2) reviewing historical drilling data in the drillhole database to identify areas of potential underestimated silver and improve where applicable through rerunning available pulps; (3) follow-up on higher grades encountered during the 2021 drill program to improve overall grade of mineral resources; (4) assessing the potential to convert material currently considered waste and upgrade inferred material to a higher resource classification in the designed pits through a drill program and initiate said program. We cannot provide any assurance that an economic process can be developed for the sulfide mineral resource using Acid POX or other similar sulfide extraction processes, that any mineral resources discovered will be in sufficient quantities and grades to justify commercial operations or that the funds required for development can be obtained on a timely or economic basis.
+A number of factors, including costs, actual mineralization, consistency and reliability of ore grades and commodity and reagent quantities and prices affect successful project development. The efficient operation of processing facilities, the existence of competent operational management, as well as the availability and reliability of appropriately skilled and experienced consultants also can affect successful project development. We can provide no assurance that the development and advancement of the Hycroft Mine sulfide processing operations will result in economically viable mining operations.
+Our reliance on third-party contractors and consultants to conduct our exploration and development projects exposes us to risks.
+In connection with the exploration and development of the Hycroft Mine, we contract and engage third party contractors and consultants to assist with aspects of such projects. As a result, we are subject to a number of risks, some of which are outside our control, including:
+ negotiating agreements with contractors and consultants on acceptable terms;
+ the inability to replace a contractor or consultant and their operating equipment in the event that either party terminates the agreement;
+ reduced control over those aspects of exploration or development operations which are the responsibility of the contractor or consultant;
+ failure of a contractor or consultant to perform under their agreement or disputes relative to their performance;
+ interruption of exploration or development operations or increased costs in the event that a contractor or consultant ceases their business due to insolvency or other unforeseen events;
+ failure of a contractor or consultant to comply with applicable legal and regulatory requirements, to the extent they are responsible for such compliance; and
+ problems of a contractor or consultant with managing their workforce, labor unrest or other employment issues.
+In addition, we may incur liability to third parties as a result of the actions of our contractors or consultants. The occurrence of one or more of these risks could increase our costs, interrupt or delay our exploration or development activities or our ability to access our ores, and adversely affect our liquidity, results of operations and financial position.
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+A shortage of equipment and supplies and/or the time it takes such items to arrive at our Hycroft Mine could adversely affect our ability to operate our business.
+We are dependent on various supplies and equipment to engage in exploration and development activities. The shortage of such supplies, equipment and parts and/or the time it takes such items to arrive at our Hycroft Mine could have a material adverse effect on our ability to explore and develop the Hycroft Mine. Such shortages could also result in increased costs and cause delays in exploration and development projects.
+Mining development and processing operations pose inherent risks and costs that may negatively impact our business.
+Mining development and processing operations involve many hazards and uncertainties, including, among others:
+ metallurgical or other processing problems;
+ ground or slope failures;
+ industrial accidents;
+ unusual and unexpected rock formations or water conditions;
+ environmental contamination or leakage;
+ flooding and periodic interruptions due to inclement or hazardous weather conditions or other acts of nature;
+ fires;
+ seismic activity;
+ pandemics adversely affecting the availability of workforces and supplies;
+ mechanical equipment failure and facility performance problems; and
+ availability of skilled labor, critical materials, equipment, reagents, and consumable items.
+These occurrences could result in damage to, or destruction of, our properties or production facilities, personal injury or death, environmental damage, delays in future mining or processing, increased future production costs, asset write downs, monetary losses and legal liability, any of which could have a material adverse effect on our future development plans and ability to raise additional capital.
+Environmental regulations could require us to make significant expenditures or expose us to potential liability.
+To the extent we become subject to environmental liabilities, the payment of such liabilities or the costs that we may incur, including costs to remedy environmental pollution, would reduce funds otherwise available to us and could have a material adverse effect on our financial condition, results of operations, and liquidity. If we are unable to fully remedy an environmental violation or release of hazardous substances, we might be required to suspend operations or enter into interim compliance measures pending completion of the required remedy or corrective action. The environmental standards that may ultimately be imposed at a mine site can vary and may impact the cost of remediation. Actual remedial costs may exceed the financial accruals that have been made for such remediation. Additionally, the timing of the remedial costs may be materially different from the current remediation plan. The potential exposure may be significant and could have an adverse effect on our financial condition and results of operations.
+Moreover, governmental authorities and private parties may bring lawsuits based upon damage to property or natural resources and injury to persons resulting from the environmental, health and safety impacts of our past and current operations, which could lead to the imposition of substantial fines, remediation costs, penalties, injunctive relief and other civil and criminal sanctions. Substantial 
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+costs and liabilities, including those required to restore the environment after the closure of mines, are inherent in our operations. We cannot provide any assurance that any such law, regulation, enforcement or private claim will not have a negative effect on our business, financial condition or results of operations.
+We are subject to numerous governmental permits that are difficult to obtain and we may not be able to obtain or renew all of the permits we require, or such permits may not be timely obtained or renewed.
+In the ordinary course of business we are required to obtain and renew governmental permits for our current limited operations at the Hycroft Mine. We will also need additional governmental permits to accomplish our long-term plans to mine sulfide ores under plans yet to be developed. Obtaining or renewing the necessary governmental permits is a complex and time-consuming process involving costly undertakings by us. The duration and success of our efforts to obtain and renew permits are contingent upon many variables not within our control, including the interpretation of applicable requirements implemented by the permitting authority and intervention by third parties in any required environmental review. We may not be able to obtain or renew permits that are necessary on a timely basis or at all, and the cost to obtain or renew permits may exceed our estimates. Failure to comply with the terms of our permits may result in injunctions, fines, suspension or revocation of permits and other penalties. We can provide no assurance that we have been, or will at all times be, in full compliance with all of the terms of our permits or that we have all required permits. The costs and delays associated with compliance with these permits and with the permitting process could alter all or a portion of any mine plan we may propose in the future, delay or stop us from proceeding with the development of the Hycroft Mine or increase the costs of development or production, any or all of which may materially adversely affect our business, prospects, results of operations, financial condition and liquidity.
+Failure to comply with environmental regulations could result in penalties and costs.
+While the Hycroft Mine is not conducting active mining operations, our facilities and prior operations have been and are, and our future development plans may continue to be, subject to extensive federal and state environmental regulation, including those enacted under the following laws:
+ Comprehensive Environmental Response, Compensation, and Liability Act;
+ Resource Conservation and Recovery Act;
+ Clean Air Act;
+ National Environmental Policy Act;
+ Clean Water Act;
+ Safe Drinking Water Act;
+ Federal Land Policy and Land Management Act of 1976; and
+ Bald and Golden Eagle Protection Act;
+Additional regulatory authorities may also have or have had jurisdiction over some of our operations and mining projects including the Environmental Protection Agency, the Nevada Division of Environmental Protection, the U.S. Fish and Wildlife Service, BLM, and the Nevada Department of Wildlife.
+These environmental regulations require us to obtain various permits, approvals and licenses and also impose standards and controls relating to development and production activities. For instance, we are required to hold a Nevada Reclamation Permit with respect to the Hycroft Mine. This permit mandates concurrent and post-mining reclamation of mines and requires the posting of reclamation bonds sufficient to guarantee the cost of mine reclamation. Changes to the amount required to be posted for reclamation bonds could materially affect our financial position, results of operations, cash flows and liquidity. Also, the U.S. Fish and Wildlife Service may designate critical habitat and suitable habitat areas it believes are necessary for survival of a threatened or endangered 
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+species. A critical habitat or suitable habitat designation could result in further material restrictions to land use and may materially delay or prohibit land access for our development. For example, we had to obtain certain permits associated with mining in the area of an eagle habitat. Failure to obtain such required permits or failure to comply with federal and state regulations could also result in delays in beginning or expanding exploration, future operations, incurring additional costs for investigation or cleanup of hazardous substances, payment of penalties for non-compliance or discharge of pollutants, and post-mining closure, reclamation and bonding, all of which could have a material adverse impact on our financial performance, results of operations and liquidity.
+Compliance with current and future government regulations may cause us to incur significant costs.
+Mining operations are subject to extensive federal and state legislation governing matters such as mine safety, occupational health, labor standards, prospecting, exploration, production, exports, toxic and hazardous substances, explosives, management of natural resources, land use, water use, air emissions, waste disposal, environmental review and taxes. While we have ceased operations at the Hycroft Mine, continued compliance with these regulations and other legislation relating to our obligations with respect to the Hycroft Mine and its future development could require us to make significant financial outlays to comply with these laws. The enactment of new legislation or more stringent enforcement of current legislation may also increase these costs, which could have a negative effect on our financial position, results of operations, and liquidity. We cannot provide any assurances that we will be able to adapt to these regulatory developments on a timely or cost-effective basis. Violations of these laws, regulations and other regulatory requirements could lead to substantial fines, penalties or other sanctions, including possible shutdown of future operations, as applicable.
+There are uncertainties as to title matters in the mining industry. Any defects in such title could cause us to lose our rights in mineral properties and jeopardize our business.
+Our mineral properties consist of private mineral rights, leases covering private lands, leases of patented mining claims and unpatented mining claims. Areas of the Hycroft Mine are unpatented mining claims located on lands administered by the BLM Nevada State office to which we have only possessory title. Because title to unpatented mining claims is subject to inherent uncertainties, it is difficult to determine conclusively ownership of such claims. These uncertainties relate to such things as sufficiency of mineral discovery, proper location and posting and marking of boundaries, and possible conflicts with other claims not determinable from descriptions of record. We believe a substantial portion of all mineral exploration, development and mining in the United States now occurs on unpatented mining claims, and this uncertainty is inherent in the mining industry.
+The present status of our unpatented mining claims located on public lands allows us the right to mine and remove valuable minerals, such as precious and base metals, from the claims conditioned upon applicable environmental reviews and permitting programs. We also are generally allowed to use the surface of the land solely for purposes related to mining and processing the mineral-bearing ores. However, legal ownership of the land remains with the United States. We remain at risk that the mining claims may be forfeited either to the United States or to rival private claimants due to failure to comply with statutory requirements. Prior to 1994, a mining claim locator who was able to prove the discovery of valuable, locatable minerals on a mining claim, and to meet all other applicable federal and state requirements and procedures pertaining to the location and maintenance of federal unpatented mining claims, had the right to prosecute a patent application to secure fee title to the mining claim from the Federal government. The right to pursue a patent, however, has been subject to a moratorium since October 1994, through federal legislation restricting the BLM from accepting any new mineral patent applications. If we do not obtain fee title to our unpatented mining claims, we can provide no assurance that we will be able to obtain compensation in connection with the forfeiture of such claims.
+There may be challenges to title to the mineral properties in which we hold a material interest. If there are title defects with respect to any properties, we might be required to compensate other persons or perhaps reduce our interest in the affected property. Also, in any such case, the investigation and resolution of title issues would divert our management s time from ongoing business operations.
+Our insurance may not cover all of the risks associated with our business.
+The mining business is subject to risks and hazards, including, but not limited to, environmental hazards, industrial accidents, the encountering of unusual or unexpected geological formations, slide-ins, flooding, earthquakes and periodic interruptions due to inclement or hazardous weather conditions. These occurrences could result in damage to, or destruction of, mineral properties, equipment or facilities, personal injury or death, environmental damage, asset write-downs, monetary losses and possible legal 
+
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+liability. Insurance fully covering many of these risks is not generally available to us and if it is, we may elect not to obtain it because of the high premium costs or commercial impracticality. Any liabilities incurred for these risks and hazards could be significant and could materially and adversely affect our results of operations, cash flows and financial condition.
+Legislation has been proposed periodically that could, if enacted, significantly affect the cost of mine development on our unpatented mining claims.
+Members of the U.S. Congress have periodically introduced bills which would supplant or alter the provisions of the Mining Law of 1872. Such bills have proposed, among other things, to either eliminate or greatly limit the right to a mineral patent and to impose a federal royalty on production from unpatented mining claims. Such proposed legislation could change the cost of holding unpatented mining claims and could significantly impact our ability to develop mineralized material on unpatented mining claims. A majority of our mining claims are unpatented claims. Although we cannot predict what legislated royalties might be, the enactment of these proposed bills could adversely affect the potential for development of our unpatented mining claims and the economics of any future mine operations on federal unpatented mining claims. Passage of such legislation could adversely affect our financial performance and results of operations.
+Regulations and pending legislation governing issues involving climate change could result in increased operating costs, which could have a material adverse effect on our business.
+A number of governments or governmental bodies have introduced or are contemplating regulatory changes in response to various climate change interest groups and the potential impact of climate change. Legislation and increased regulation regarding climate change could materially increase our costs, and the costs of our suppliers, for further exploration and development of the Hycroft Mine, including costs related to increased energy requirements, capital equipment, environmental monitoring and reporting and other costs to comply with such regulations. Any adopted future climate change regulations could also negatively impact our ability to compete with companies situated in areas not subject to such regulations. Given the emotion, political significance and uncertainty around the impact of climate change and how it should be dealt with, we cannot predict how legislation and regulation will affect our financial condition, operating performance and ability to compete. Furthermore, even without such regulation, increased awareness and any adverse publicity in the global marketplace about potential impacts on climate change by us or other companies in our industry could harm our reputation.
+Climate change could have an adverse impact on our cost of operations.
+The potential physical impacts of climate change on our development activities or future operations are highly uncertain and would be particular to the area in which we operate. These climate changes may include changes in rainfall and storm patterns and intensities, water shortages and changing temperatures. These changes in climate could adversely affect our mining operations, including by affecting the moisture levels and pH of ore on our leach pads, could materially and adversely affect the cost to construct and operate the Hycroft Mine and materially and adversely affect the financial performance of our operations.
+Business-Related Risks
+We will need to raise additional capital, but such capital may not be available on favorable terms or at all.
+The exploration and development of our Hycroft Mine for mining and processing our mineral resources will require significant investment. Failure to obtain sufficient financing may result in the delay or indefinite postponement of exploration, development or production at the Hycroft Mine. The covenants in the Sprott Credit Agreement, as amended and restated in the Second A&R Agreement, could significantly limit our ability to secure new or additional credit facilities, increase our cost of borrowing, and make it difficult or impossible to raise additional capital on favorable terms or at all.
+Our primary future cash requirements for 2022 will be to fund working capital needs, capital and project expenditures, satisfying debt service required under the Sprott Credit Agreement, as amended and restated in the Second A&R Agreement, and other corporate expenses so that we can continue to develop the Hycroft Mine by conducting targeted exploration and completing the necessary technical studies to determine the likely timeline to bring the sulfide mineral resources into commercial scale operation. As of December 31, 2021 we had cash of $12.3 million and as of March 30, 2022 had raised approximately $194.4 million in gross proceeds, before (i) deduction of commissions, fees and expenses, from a private placement of our equity securities and from an at-
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+the-market public equity offering of our common stock and (ii) prepayments of debt under the Sprott Credit Agreement, as amended and restated in the Second A&R Agreement. You are cautioned that management s expectations regarding our liquidity and capital resources are based on a number of assumptions that we believe are reasonable but could prove to be incorrect. For example, our expectations are based on assumptions regarding exploration and development costs, commodity prices, gold and silver recovery percentages and rates, production estimates, anticipated costs and other factors that are subject to a number of risks, many of which are beyond our control. If our assumptions prove to be incorrect, we may require additional financing sooner than we expect to continue to operate our business, which may not be available on favorable terms or at all and which could have a material adverse effect on our prospects, results of operations, financial condition and liquidity.
+If we lose key personnel or are unable to attract and retain additional personnel, we may be unable to develop our business.
+Our development in the future will be highly dependent on the efforts of key management employees, specifically, Diane R. Garrett, Ph.D., our President and Chief Executive Officer, Stanton Rideout, our Executive Vice President and Chief Financial Officer, and other key employees that we may hire in the future. We will need to recruit and retain other qualified managerial and technical employees to build and maintain our operations. If we are unable to successfully recruit and retain such persons, our development and growth could be significantly curtailed.
+The Sprott Credit Agreement, as amended and restated in the Second A&R Agreement, imposes significant operating and financial restrictions that may limit our ability to operate our business.
+The Sprott Credit Agreement, as amended and restated in the Second A&R Agreement, imposes significant operating and financial restrictions on us and our restricted subsidiaries. These restrictions limit our ability and the ability of our restricted subsidiaries to, among other things, as applicable:
+ incur additional debt;
+ pay dividends or make other restricted payments, including certain investments;
+ create or permit certain liens;
+ sell assets;
+ engage in certain transactions with affiliates; and
+ consolidate or merge with or into other companies, or transfer all or substantially all of our assets or the assets of our restricted subsidiaries.
+These restrictions could limit our ability to finance our future operations or capital needs, make acquisitions or pursue available business opportunities.
+In addition, the Sprott Credit Agreement, as amended and restated in the Second A&R Agreement, requires us to comply with a number of customary covenants, including:
+ covenants related to the delivery of monthly, quarterly and annual consolidated financial statements, budgets and annual projections;
+ maintaining required insurance;
+ compliance with laws (including environmental);
+ compliance with ERISA;
+ maintenance of ownership of 100% of Hycroft Mine;
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+ restrictions on consolidations, mergers or sales of assets;
+ limitations on liens;
+ limitations on issuance of certain equity interests;
+ limitations on issuance of additional indebtedness;
+ limitations on transactions with affiliates; and
+ other customary covenants.
+We have received several waivers to date from covenant obligations under the Sprott Credit Agreement prior to the amendment and restatement in the Second A&R Agreement. We cannot assure you that we will satisfy these covenants or that our lenders will continue to waive any future failure to do so. A breach of any of the covenants under the Sprott Credit Agreement, as amended and restated in the Second A&R Agreement, could result in a default. If a default occurs under the Sprott Credit Agreement, as amended and restated in the Second A&R Agreement, and/or the Royalty Agreement among the Company, our wholly owned subsidiary Hycroft Resources and Development, LLC and Sprott Private Resource Lending II (CO) Inc., (the Sprott Royalty Agreement ), the lenders could elect to declare the debt, together with accrued interest and other fees, to be immediately due and payable and proceed against the collateral securing that debt, which, in the case of the Sprott Credit Agreement, as amended and restated in the Second A&R Agreement, and the Sprott Royalty Agreement, constitutes all or substantially all of our assets.
+Our substantial indebtedness could adversely affect our financial condition.
+As of March 31, 2022, we had substantial outstanding indebtedness under the Sprott Credit Agreement, as amended and restated in the Second A&R Agreement, and the Assumed New Subordinated Notes. Subject to the limits and terms contained in the Sprott Credit Agreement, as amended and restated in the Second A&R Agreement, if we are able to incur additional debt or grant additional security interests from time to time to finance working capital, capital expenditures, investments or acquisitions, or for other purposes, then the risks related to our high level of debt could intensify. Our high level of debt with no active mining operations to generate revenue, could:
+ make it more difficult for us to satisfy our obligations with respect to our outstanding debt;
+ require a substantial portion of our cash flows to be dedicated to debt service instead of other purposes, thereby reducing the amount of cash flows available for working capital, capital expenditures, acquisitions and other general corporate purposes;
+ limit our ability to obtain additional financing to fund future working capital, capital expenditures, acquisitions or other general corporate requirements;
+ increase our vulnerability to commodity price volatility, including increases in prices of commodities that we purchase and decreases in prices of gold and silver that we sell, each as part of our operations, general adverse economic and industry conditions;
+ limit our flexibility in planning for and reacting to changes in the industry in which we compete;
+ place us at a disadvantage compared to other, less leveraged competitors; and
+ increase our cost of borrowing.
+Any of the above-listed factors could have an adverse effect on our business, financial condition and results of operations and our ability to meet our payment obligations under our debt, and the price of our Common Stock. The Sprott Credit Agreement, as amended and restated in the Second A&R Agreement, contains restrictive covenants that limit our ability to engage in activities that 
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+may be in our long-term best interest. Our failure to comply with those covenants could result in an event of default which, if not cured or waived, could result in the acceleration of nearly all of our debt.
+If we default on our obligations to pay any of our indebtedness or otherwise default under the agreements governing our indebtedness, lenders could accelerate such debt and we may be subject to restrictions on the payment of our other debt obligations or cause a cross-acceleration.
+Any default under the agreements governing our indebtedness that is not waived by the required lenders or holders of such indebtedness, and the remedies sought by the holders of such indebtedness, could prevent us from paying principal, premium, if any, and interest on other debt instruments. If we are unable to generate sufficient cash flow or are otherwise unable to obtain funds necessary to meet required payments of principal, premium, if any, and interest on our indebtedness and royalty payment obligations, or if we otherwise fail to comply with the various covenants in any agreement governing our indebtedness, we would be in default under the terms of the agreements governing such indebtedness and other indebtedness under the cross- default and cross-acceleration provisions of such agreements. In the event of such default:
+ the lenders or holders of such indebtedness could elect to terminate any commitments thereunder, declare all the funds borrowed thereunder to be due and payable and, if not promptly paid, in the case of our secured debt, institute foreclosure proceedings against our assets; and
+ even if these lenders or holders do not declare a default, they may be able to cause all of our available cash to be used to repay indebtedness owed to them.
+As a result of such default and any actions the lenders may take in response thereto, we could be forced into bankruptcy or liquidation.
+We may not have sufficient cash or we may not be able to generate sufficient cash to service our outstanding indebtedness and may be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful.
+Our ability to make scheduled payments on our debt and royalty obligations or refinance our debt obligations (if necessary) depends on our unrestricted cash on hand, financial condition, which is subject to prevailing economic and competitive conditions and to certain financial, business, legislative, regulatory and other factors beyond our control, including the market prices of gold and silver. We may be unable to maintain a level of cash flow sufficient to permit us to pay the principal, premium, if any, and interest on our indebtedness.
+If our cash flows and capital resources are insufficient to fund our debt service obligations, we could face substantial liquidity problems and could be forced to reduce or delay investments and capital expenditures or to dispose of material assets, seek additional debt or equity capital or restructure or refinance our indebtedness. We may not be able to effect any such alternative measures, if necessary, on commercially reasonable terms or at all and, even if successful, those alternative actions may not allow us to meet our scheduled debt service obligations. The Sprott Credit Agreement, as amended and restated in the Second A&R Agreement, restricts our ability to dispose of assets and use the proceeds from those dispositions and may also restrict our ability to raise debt to be used to repay other indebtedness when it becomes due. We may not be able to consummate those dispositions or to obtain proceeds in an amount sufficient to meet any debt service payment obligations then due.
+Our inability to generate sufficient cash flows to satisfy our debt obligations, or to refinance our indebtedness on commercially reasonable terms or at all, would materially and adversely affect our financial position and results of operations and our ability to satisfy our obligations.
+If we cannot make scheduled payments on our debt, we will be in default and the lenders under the Sprott Credit Agreement, as amended and restated in the Second A&R Agreement, could foreclose against the assets securing their borrowings and we could be forced into bankruptcy or liquidation.
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+Land reclamation requirements for the Hycroft Mine may be burdensome and expensive and include requirements that we provide financial assurance supporting those requirements.
+Land reclamation requirements are generally imposed on companies with mining operations in order to minimize long-term effects of land disturbance. Reclamation may include requirements to control dispersion of potentially deleterious effluents, treat ground and surface water to drinking water standards, and reasonably re-establish pre-disturbance landforms and vegetation.
+In order to carry out reclamation obligations imposed on us in connection with our activities, we must allocate financial resources that might otherwise be spent on further development programs. We have established a provision for our reclamation obligations on the Hycroft Mine property, as appropriate, but this provision may not be adequate. If we are required to carry out unanticipated reclamation work, our financial position could be adversely affected.
+We are also required by U.S. federal and state laws and regulations to provide financial assurance sufficient to allow a third party to implement approved reclamation plans for the Hycroft Mine if we are unable to do so. Third party financial assurances may not be available to us or we may elect not to obtain it because of the high costs, associated collateral requirements may be too expensive or it may be commercially impractical which could adversely affect our financial position.
+We are dependent upon information technology systems that are subject to disruption, damage, failure and risks associated with implementation and integration.
+We are dependent upon information technology systems in the conduct of our operations. Our information technology systems are subject to disruption, damage or failure from a variety of sources, including, without limitation, computer viruses, security breaches, cyber-attacks, natural disasters and defects in design. Cybersecurity incidents, in particular, are evolving and include, but are not limited to, malicious software, attempts to gain unauthorized access to data and other electronic security breaches that could lead to disruptions in systems, extortion to prevent or the unauthorized release of confidential or otherwise protected information and the corruption of data. Given the unpredictability of the timing, nature and scope of information technology disruptions, we could potentially be subject to operational downtimes, operational delays, extortion, the compromising of confidential or otherwise protected information, destruction or corruption of data, security breaches, other manipulation or improper use of our systems and networks or financial losses from remedial actions, any of which could have a material adverse effect on our cash flows, financial condition or results of operations.
+We could also be adversely affected by system or network disruptions if new or upgraded information technology systems are defective, not installed properly or not properly integrated into our operations. System modification failures could have a material adverse effect on our business, financial position and results of operations and could, if not successfully implemented, adversely impact the effectiveness of our internal controls over financial reporting.
+The transition away from the London Interbank Offered Rate ( LIBOR ) could have an adverse impact on us.
+The financial markets are in the process of transitioning away from LIBOR to alternative benchmark rate(s), which transition is scheduled to be complete by mid-2023. The calculation of the monthly interest rate on our advances under the Sprott Credit Agreement, as amended and restated by the Second A&R Agreement, is partially based on LIBOR. The Sprott Credit Agreement, as amended and restated by the Second A&R Agreement, contains LIBOR benchmark replacement provisions. At this time, there can be no assurance as to whether any alternative benchmark or resulting interest rates may be more or less favorable than LIBOR or whether there are any other unforeseen impacts of the discontinuation of LIBOR. As a result, the consequences related to this transition could adversely affect our debt service obligations, financing costs, liquidity, financial condition, results of operations or cash flows and could impair our access to the capital markets.
+We identified a material weakness in our internal control over financial reporting and determined that our disclosure controls and procedures were ineffective which, if not remediated, may result in material misstatements of our consolidated financial statements or cause us to fail to meet our periodic reporting obligations.
+In connection with the restatement of our consolidated financial statements on Form 10-K/A for the year ended December 31, 2020, management concluded there was a material weakness in our internal control over financial reporting. A material weakness is a 
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+deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim consolidated financial statements would not be prevented or detected on a timely basis.
+Management identified a material weakness in our controls over the accounting for the 5-Year Private Warrants issued in connection with the initial public offering of MUDS and recorded to our consolidated financial statements as a result of the Recapitalization Transaction that was consummated on May 29, 2020. Our controls to evaluate the accounting for complex financial instruments, such as for warrants issued by MUDS, did not operate effectively to appropriately apply the provisions of ASC 815-40. This material weakness resulted in a material error in our accounting for the 5-Year Private Warrants recorded as part of the Recapitalization Transaction and a restatement of our previously issued consolidated financial statements as more fully described in Note 25 - Restatement of Previously Issued Audited Financial Statements to the Notes to Consolidated Financial Statements set forth in our Annual Report on Form 10-K/A for the year ended December 31, 2020. As a result, Management concluded that, as of December 31, 2020, our internal control over financial reporting and our disclosure controls and procedures were not effective.
+To remediate the material weakness in our internal control over financial reporting, management implemented additional review procedures, and additional training and enhancements to the accounting policy related to the accounting for equity and liability instruments (including those with warrants) to determine proper accounting in accordance with GAAP.
+Although our remediation plan has been implemented and completed as of the filing date of the 2021 Form 10-K, the material weakness was not considered remediated until the controls operated for a sufficient period and management concluded, through testing, that our internal controls were operating effectively. There can be no assurance that additional material weaknesses will not be identified in the future. If we are unsuccessful in remediating our existing or any future material weaknesses or other deficiencies in our internal control over financial reporting or disclosure controls and procedures, investors may lose confidence in our financial reporting and the accuracy and timing of our financial reporting and disclosures and our business, reputation, results of operations, liquidity, financial condition, ability to access the capital markets, perceptions of our creditworthiness, and stock price could be adversely affected. In addition, we may be unable to maintain or regain compliance with applicable securities laws or stock market listing requirements, either of which could subject us to possible litigation.
+In addition, there can be no assurance that additional material weaknesses will not be identified in the future. If we are unsuccessful in remediating our existing or any future material weaknesses or other deficiencies in our internal control over financial reporting or disclosure controls and procedures, investors may lose confidence in our financial reporting and the accuracy and timing of our financial reporting and disclosures and our business, reputation, results of operations, liquidity, financial condition, ability to access the capital markets, perceptions of our creditworthiness, and stock price could be adversely affected. In addition, we may be unable to maintain or regain compliance with applicable securities laws or stock market listing requirements.
+Our three largest stockholders are able to exert significant influence over matters submitted to stockholders for approval, which could delay or prevent a change in corporate control or result in the entrenchment of management or the Board, possibly conflicting with the interests of our other stockholders.
+As of March 31, 2022, Mudrick Capital, Eric Sprott and AMC owned approximately 12.4%, 11.9% and 11.9% of our outstanding voting securities, respectively, and have the right to acquire 13,308,529, 23,408,240 and 23,408,240 additional shares of Common Stock, respectively, upon the exercise of New Warrants held by them, subject to any election of a beneficial ownership blocker. Because of their significant stockholdings, each of Mudrick Capital, Eric Sprott and AMC could exert significant influence in determining the outcome of corporate actions requiring stockholder approval and otherwise influence our business. In addition, AMC has exercised its contractual right under its Subscription Agreement, as amended, to appoint a representative to our Board. This influence could have the effect of delaying or preventing a change in control of the Company or entrenching management or the Board, which could conflict with the interests of other stockholders and, consequently, could adversely affect the market price of our Common Stock.
+
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+Risks related to our Common Stock and Warrants
+The market prices and trading volume of shares of our Common Stock have recently experienced, and may continue to experience, extreme volatility, which could cause purchasers of our Common Stock to incur substantial losses.
+The market prices and trading volume of shares of our Common Stock have recently experienced, and may continue to experience, extreme volatility, which could cause purchasers of our Common Stock to incur substantial losses. For example, during 2022 to April 12, 2022, the market price of our Common Stock has fluctuated from an intra-day low of $0.284 per share on March 2, 2022 to an intra-day high of $3.10 on March 29, 2022, and the last recorded sales price of our common stock on Nasdaq on May 13, 2022, was $1.34 per share. During 2022 to May 13, 2022, daily trading volume ranged from approximately 78,900 to 386,186,700 shares.
+ We believe that the recent volatility and our current market prices may reflect market and trading dynamics unrelated to our underlying business, or macro or industry fundamentals, and we do not know how long these dynamics will last. Under the circumstances, we caution you against investing in our Common Stock, unless you are prepared to incur the risk of losing all or a substantial portion of your investment.
+ Extreme fluctuations in the market price of our Common Stock have been accompanied by reports of strong and atypical retail investor interest, including on social media and online forums. The market volatility and trading patterns we have experienced create several risks for investors, including the following:
+o
+the market price of our Common Stock has experienced and may continue to experience rapid and substantial increase or decreases unrelated to our financial performance or prospects, or macro or industry fundamentals, and substantial increases may be significantly inconsistent with the risks and uncertainties that we continue to face;
+
+o
+factors in the public trading market for our Common Stock include the sentiment of retail investors (including as may be expressed on financial trading and other social media sites and online forums), the direct access by retail investors to broadly available trading platforms, the amount and status of short interest in our securities, access to margin debt, trading in options and other derivatives on our Common Stock and any related hedging and other trading factors;
+
+o
+our market capitalization, as implied by various trading prices, currently reflects valuations that diverge significantly from those seen prior to recent volatility, and to the extent these valuations reflect trading dynamics unrelated to our financial performance or prospects, purchasers of our Common Stock could incur substantial losses if there are declines in market prices driven by a return to earlier valuations; and
+
+o
+to the extent volatility in our Common Stock is caused by a short squeeze in which coordinated trading activity causes a spike in the market price of our Common Stock as traders with a short position make market purchases to avoid or to mitigate potential losses, investors purchase at inflated prices unrelated to our financial performance or prospects, and may thereafter suffer substantial losses as prices decline once the level of short-covering purchases has abated.
+
+ 
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+The market price of our shares of Common Stock and publicly-traded warrants may fluctuate widely.
+The trading price of our Common Stock and Warrants listed for trading may fluctuate substantially and may be lower than their current prices. The market prices and trading volume of shares of our Common Stock have recently experienced, and may continue to experience, extreme volatility, which could cause purchasers of our Common Stock to incur substantial losses. We may continue to incur rapid and substantial increases or decreases in our stock price in the foreseeable future that may not coincide in timing with the disclosure of news or developments by or affecting us. Accordingly, the market price of shares of our Common Stock may fluctuate dramatically, and may decline rapidly, regardless of any developments in our business. Overall, there are various factors, many of which are beyond our control, that could negatively affect the market price of our common stock or result in fluctuations in the price or trading volume of our common stock, including:
+ publication of research reports by analysts or others about us or the precious metals market, which may be unfavorable, inaccurate, inconsistent or not disseminated on a regular basis;
+ changes in market interest rates that may cause purchasers of shares of our Common stock to demand a different yield;
+ changes in market valuations of similar companies;
+ market reaction to any additional equity, debt or other securities that we may issue in the future, and which may or may not dilute the holdings of our existing stockholders;
+ actual or anticipated variations in our annual or quarterly results of operations;
+ additions or departures of key personnel or Board members;
+ actions by institutional or significant stockholders;
+ short interest in our stock and the market response to such short interest;
+ the dramatic increase in the number of individual holders of our Common Stock and their participation in social media platforms targeted at speculative investing;
+ speculation in the press or investment community about our company or industry;
+ strategic actions by us or our competitors, such as acquisitions or other investments;
+ the ongoing impacts and developments relating to the COVID-19 pandemic;
+ legislative, administrative, regulatory or other actions affecting our business, our industry;
+ investigations, proceedings, or litigation that involve or affect us; and
+ general market, economic and political conditions, such reductions in precious metals prices, increases in fuel and other commodity prices used in the operation of our business, currency fluctuations and acts of war or terrorism.
+In addition, in the past, following periods of volatility in the overall market and the market prices of particular companies securities, securities class action litigations have often been instituted against these companies. Litigation of this type, if instituted against us, could result in substantial costs and a diversion of our management s attention and resources. Any adverse determination in any such litigation or any amounts paid to settle any such actual or threatened litigation could require that we make significant payments.
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+You may experience dilution as a result of future equity offerings.
+On March 14, 2022, we entered into definitive agreements to issue 46,816,480 Units in the 2022 Private Placement, with each Unit consisting of one share of our Common Stock and one New Warrant to purchase one share of Common Stock. In addition, we conducted an at-the-market registered public offering in which we sold 89,553,602 additional shares of our Common Stock. The 2022 Private Placement and the at-the-market registered public offering substantially increased the number of our issued and outstanding shares of Common Stock. In the future, we may issue additional shares of our Common Stock to raise cash to bolster our liquidity, to pay indebtedness, for working capital, to finance strategic initiatives and future acquisitions or for other purposes. We may also issue securities convertible into, or exchangeable for, or that represent the right to receive, shares of our Common Stock. We may also acquire interests in other companies or other assets by using a combination of cash and shares of our Common Stock or just shares of our Common Stock. We may sell shares of our Common Stock or other securities in any other offering at a price per share that is less than the prices per share paid by investors, and investors purchasing shares or other securities in the future could have rights superior to existing stockholders. The price per share at which we sell additional shares of our Common Stock, or securities convertible into, exercisable or exchangeable for shares of our Common Stock, in future transactions may be higher or lower than the prices per share paid by investors. Additional equity offerings may dilute the holdings of our existing stockholders or reduce the market price of our Common Stock, or both. Any of these events may dilute the ownership interests of current stockholders, reduce our earnings per share or have an adverse effect on the price of shares of our Common Stock. Further, sales of substantial amounts of our Common Stock, or the perception that these sales could occur, could have a material adverse effect on the price of our Common Stock.
+A short squeeze due to a sudden increase in demand for shares of our Common Stock that largely exceeds supply and/or focused investor trading in anticipation of a potential short squeeze have led to, may be currently leading to, and could again lead to, extreme price volatility in shares of our Common Stock.
+Investors may purchase shares of our Common Stock to hedge existing exposure or to speculate on the price of our Common Stock. Speculation on the price of our Common Stock may involve long and short exposures. To the extent aggregate short exposure exceeds the number of shares of our Common Stock available for purchase on the open market, investors with short exposure may have to pay a premium to repurchase shares of our Common Stock for delivery to lenders of our Common Stock. Those repurchases may, in turn, dramatically increase the price of shares of our Common Stock until additional shares of our Common Stock are available for trading or borrowing. This is often referred to as a short squeeze. With the recent substantial increase in volume of our shares being traded and trading price, the proportion of our Common Stock that may be traded in the future by short sellers may increase the likelihood that our Common Stock will be the target of a short squeeze. A short squeeze and/or focused investor trading in anticipation of a short squeeze have led to, may be currently leading to, and could again lead to volatile price movements in shares of our Common Stock that may be unrelated or disproportionate to our financial performance or prospects and, once investors purchase the shares of our Common Stock necessary to cover their short positions, or if investors no longer believe a short squeeze is viable, the price of our Common Stock may rapidly decline. Investors that purchase shares of our Common Stock during a short squeeze may lose a significant portion of their investment. Under the circumstances, we caution you against investing in our Common Stock, unless you are prepared to incur the risk of losing all or a substantial portion of your investment.
+Information available in public media that is published by third parties, including blogs, articles, online forums, message boards and social and other media may include statements not attributable to us and may not be reliable or accurate.
+We have received, and may continue to receive, a high degree of media coverage that is published or otherwise disseminated by third parties, including blogs, articles, online forums, message boards and social and other media. This includes coverage that is not attributable to statements made by our directors, officers or employees. You should read carefully, evaluate and rely only on the information contained in documents filed with the SEC in determining whether to purchase shares of our Common Stock. Information provided by third parties may not be reliable or accurate and could materially impact the trading price of our Common Stock which could cause losses to your investments.
+Increases in market interest rates may cause potential investors to seek higher returns and therefore reduce demand for our Common Stock, which could result in a decline in our stock price.
+One of the factors that may influence the price of our Common Stock is the return on our Common Stock (i.e., the amount of distributions as a percentage of the price of our Common Stock) relative to market interest rates. An increase in market interest rates, 
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+which are currently at low levels relative to historical rates, may lead prospective purchasers of our Common Stock to expect a return, which we may be unable or choose not to provide as we have never paid a dividend and have no current intention to pay any dividends. Further, higher interest rates would likely increase our borrowing costs and potentially decrease the cash available. Thus, higher market interest rates could cause the market price of our Common Stock to decline.
+Volatility in the price of our Common Stock may subject us to securities litigation.
+As discussed above, the market for our Common Stock has been characterized recently by significant price volatility when compared to seasoned issuers, and we expect that our share price will continue to be more volatile than a seasoned issuer for the indefinite future. In the past, plaintiffs have often initiated securities class action litigation against a company following periods of volatility in the market price of its securities. We may in the future be the target of similar litigation. Securities litigation could result in substantial costs and liabilities and could divert management s attention and resources.
+We do not anticipate paying dividends on our Common Stock in the foreseeable future.
+We currently plan to invest all available funds and future cash flows, if any, in the development and growth of our business. We have never paid dividends on our Common Stock and currently have no plans to do so. Our debt agreements contain provisions that restrict our ability to pay dividends. As a result, a rise in the market price of our Common Stock, which is uncertain and unpredictable, will be your sole source of potential gain in the foreseeable future and you should not rely on an investment in our Common Stock for dividend income.
+Future offerings of debt, which would be senior to our Common Stock upon liquidation, and/or preferred equity securities, which may be senior to our Common Stock for purposes of distributions or upon liquidation, could adversely affect the market price of our Common Stock.
+In the future, we may attempt to increase our capital resources by making additional offerings of debt or preferred equity securities, including convertible or non-convertible senior or subordinated notes, convertible or non-convertible preferred stock, medium-term notes and trust preferred securities. Upon liquidation, holders of our debt securities and shares of preferred stock and lenders with respect to other borrowings will receive distributions of our available assets prior to the holders of our Common Stock. In addition, any preferred stock we may issue could have a preference on liquidating distributions or a preference on distribution payments that could limit our ability to make a distribution to the holders of our Common Stock. Since our decision to issue securities in any future offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing or nature of our future offerings. Thus, our stockholders bear the risk of our future offerings reducing the market price of our Common Stock.
+We may receive a delisting notice from the Nasdaq Stock Market and our Common Stock and Warrants could be delisted from trading unless our Common Stock price trades above $1.00 per share.
+On December 29, 2021, we received a written notice from the Listing Qualifications department of The Nasdaq Stock Market ( Nasdaq ) indicating that we were not in compliance with the $1.00 minimum bid price requirement set forth in Nasdaq Listing Rule 5550(a)(2) (the Listing Rule) for continued listing on the Nasdaq Capital Market. On March 24, 2022, Nasdaq informed us that we had resolved our deficiency and regained compliance with the Listing Rule. We can provide no assurance that the trading price of our Common Stock will not again fall below $1.00 per share for a period of 30 consecutive trading days and that we will not receive another notice that we were not in compliance with the $1.00 minimum bid price requirement set forth in Listing Rule for continued listing on the Nasdaq Capital Market or that we will be able to regain compliance with the minimum bid price requirement, even if we maintain compliance with the other listing requirements.
+There is no guarantee that our outstanding public warrants will ever be in the money, and they may expire worthless.
+We have 34,289,898 publicly traded warrants outstanding that entitle holders to purchase one share of our Common Stock at an exercise price of $11.50 per share for a period of five years from the Recapitalization Transaction. On October 6, 2020, we issued 9,583,334 units in an underwritten public offering at an offering price to of $9.00 per unit, with each unit consisting of one share of our Common Stock and one October 2020 warrant to purchase one share of our Common Stock at an exercise price of $10.50 per share.
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+Additionally, we assumed the obligations and liabilities under that certain warrant agreement, dated as of October 22, 2015, by and between Seller and Computershare Inc., a Delaware corporation, and its wholly owned subsidiary Computershare Trust Company, N.A., a federally chartered trust company, collectively as initial warrant agent; and Continental Stock Transfer & Trust Company, LLC was named as the successor warrant agent (the Seller Warrant Agreement ). Pursuant to the assumption of the Seller Warrant Agreement, the warrants issued thereunder (the Seller warrants ) became exercisable into shares of our common stock. The Seller warrants will expire by their terms on October 22, 2022. As of May 13, 2022, the exercise price for the Seller warrants was $40.31 per share of our Common Stock.
+There is no guarantee that any or all of the public warrants will ever be in the money prior to their expiration, and as such, the warrants may expire worthless.
+Our 5-Year Private Warrants are being accounted for as a warrant liability and are being recorded at fair value upon issuance with changes in fair value each period reported in earnings, which could increase the volatility in our net income (loss) and may have an adverse effect on the market price of our common stock.
+In addition to other securities, warrants to purchase shares of our Common Stock were issued in a private placement to the SPAC sponsor and underwriter (the 5 Year Private Warrants ) in the aggregate amount of 7,740,000 shares of our Common Stock at an exercise price of $11.50 per share on May 29, 2020, and concurrently with the closing of the Recapitalization Transaction, as part of a forward purchase unit offering, we issued an additional 2,500,000 5-Year Private Warrants to the SPAC sponsor at an exercise price of $11.50 per share.
+We have determined that the 5-Year Private Warrants are a liability that is marked-to-market with the non-cash fair value adjustments recorded in earnings at each reporting period. Changes in the trading price of our Common Stock and the fair value of the 5-Year Private Warrants could result in significant volatility in our warrant liability and our net income (loss) in our Consolidated Statements of Operations.
+Anti-takeover provisions contained in our charter and bylaws, as well as provisions of Delaware law, could impair a takeover attempt.
+Our charter contains provisions that may discourage unsolicited takeover proposals that stockholders may consider to be in their best interests. We are also subject to anti-takeover provisions under Delaware law, which could delay or prevent a change of control. Together, these provisions may make it more difficult to remove management and may discourage transactions that otherwise could involve payment of a premium over prevailing market prices for our securities. These provisions include:
+ no cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates;
+ the right of our Board to appoint a director to fill a vacancy created by the expansion of the Board or the resignation, death or removal of a director in certain circumstances, which prevents stockholders from being able to fill vacancies our Board;
+ a prohibition on stockholders calling a special meeting and the requirement that a meeting of stockholders may only be called by members our Board, which may delay the ability of our stockholders to force consideration of a proposal or to take action, including the removal of directors;
+ the ability of our Board to determine whether to issue shares of preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquirer;
+ limiting the liability of, and providing indemnification to, the directors and officers; and
+ advance notice procedures that stockholders must comply with in order to nominate candidates to our Board or to propose matters to be acted upon at a meeting of stockholders, which may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer s own slate of directors or otherwise attempting to obtain control of the Company.
+
+-39-
+
+Table of Contents
+
+We are an emerging growth company and a smaller reporting company, and the reduced disclosure requirements applicable to us as such may make our common stock less attractive to our stockholders.
+We qualify as an emerging growth company as defined in Section 2(a)(19) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, which we refer to as the JOBS Act. As such, we have elected to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies for as long as we continue to be an emerging growth company, including (i) the exemption from the auditor attestation requirements with respect to internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act, (ii) the exemptions from say-on-pay, say-on-frequency and say-on-golden parachute voting requirements and (iii) reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements. As a result, our stockholders may not have access to certain information they deem important. We will remain an emerging growth company until the earliest of (i) the last day of the fiscal year (a) following February 12, 2023, the fifth anniversary of the IPO, (b) in which we have total annual gross revenue of at least $1.07 billion or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock that are held by non-affiliates exceeds $700 million as of the last business day of the Company s prior second fiscal quarter, and (ii) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.
+In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the exemption from complying with new or revised accounting standards provided in Section 7(a)(2)(B) of the Securities Act as long as we qualify as an emerging growth company. An emerging growth company can therefore delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies, but any such election to opt out is irrevocable. We have elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our consolidated financial statements with another public company which is neither an emerging growth company nor an emerging growth company that has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.
+We are also a smaller reporting company , and we will remain a smaller reporting company until the fiscal year following the determination that our voting and non-voting common stock held by non-affiliates is $250 million or more measured on the last business day of our second fiscal quarter, or our annual revenues are $100 million or more during the most recently completed fiscal year and our voting and non-voting common stock held by non-affiliates is $700 million or more measured on the last business day of our second fiscal quarter. Similar to emerging growth companies, smaller reporting companies are able to provide simplified executive compensation disclosure and have certain other reduced disclosure obligations, including, among other things, being required to provide only two years of audited financial statements. Our stockholders may find our common stock less attractive as a result of our status as an emerging growth company and smaller reporting company and our reliance on the reduced disclosure requirements afforded to these companies.
+ 
+
+-40-
+
+Table of Contents
+
+DESCRIPTION OF BUSINESS
+About the Company
+Hycroft Mining Holding Corporation (formerly known as Mudrick Capital Acquisition Corporation) was incorporated under the laws of the state of Delaware on August 28, 2017. We are a U.S.-based gold and silver development company that owns Hycroft Mine in the prolific mining region of Northern Nevada.
+Our property, the Hycroft Mine, has historically operated as an open-pit oxide mining and heap leach processing operation and is located approximately 54 miles west of Winnemucca, Nevada. Mining operations at the Hycroft Mine were restarted in 2019 on a pre-commercial scale and discontinued in November 2021 as a result of the then current and expected ongoing cost pressures for many of the reagents and consumables used at the Hycroft Mine and the timeline for completing our updated technical studies in 2022 for optimal processing the plan forward. In February 2022, Hycroft, along with its third-party consultants, completed and filed the 2022 Hycroft TRS with an effective date of February 18, 2022 and prepared in accordance with the Modernization Rules. The 2022 Hycroft TRS provides an Initial Assessment of the mineral resource estimate utilizing a milling and Acid POX process for sulfide mineralization and heap leaching process for oxide and transition mineralization. As a result of the milling and Acid POX process presented in the 2022 Hycroft TRS, as compared to the novel two-step oxidation and heap leap process presented in the 2019 Hycroft TRS, a feasibility study prepared in accordance with the requirements of the Modernization Rules, with an effective date of July 31, 2019, and the associated fundamental changes to the assumptions underlying the 2019 Hycroft TRS, the 2022 Hycroft TRS supersedes and replaces the 2019 Hycroft TRS and the 2019 Hycroft TRS and information from such 2019 Hycroft TRS should no longer be relied upon. Our ongoing disclosures and many of management estimates and judgements will be based on the 2022 Hycroft TRS and not the 2019 Hycroft TRS. The Company will continue to build on the work to date and investigate opportunities identified through progressing the technical and data analyses leading up to the 2022 Hycroft TRS and will provide an updated technical report at an appropriate time. During the year ended December 31, 2021 we sold 56,045 ounces of gold and 397,546 ounces of silver. As of December 31, 2021, the Hycroft Mine had measured and indicated mineral resources of 9.6 million ounces of gold and 446.0 million ounces of silver and inferred mineral resources of 5.0 million ounces of gold and 150.4 million ounces of silver, which are contained in oxide, transitional, and sulfide ores.
+Our corporate headquarters is located at 4300 Water Canyon Road, Unit 1 Winnemucca, Nevada 89445, and our telephone number is (775) 304-0260. Our website is www.hycroftmining.com.
+Recapitalization Transaction with MUDS
+As discussed in Note 1 - Company Overview and Note 3 - Recapitalization Transaction to the 2021 Year End Notes, on May 29, 2020, we, formerly known as Mudrick Capital Acquisition Corporation ( MUDS ), consummated a business combination transaction (the Recapitalization Transaction ) that resulted in MUDS Acquisition Sub, Inc. ( Acquisition Sub ) acquiring all of the issued and outstanding equity interests of the direct subsidiaries of Hycroft Mining Corporation ( Seller ) and substantially all of the other assets of Seller and assuming substantially all of the liabilities of Seller. In conjunction with the Recapitalization Transaction, Seller s indebtedness existing prior to the Recapitalization Transaction was either repaid, exchanged for indebtedness of the Company, exchanged for shares of Common Stock or converted into shares of Seller common stock, and our post-Recapitalization Transaction indebtedness included amounts drawn under the Sprott Credit Agreement and the assumption of the Assumed New Subordinated Notes.
+Segment Information
+The Hycroft Mine is our only operating segment and includes the operations, development, and exploration activities and contains 100% of our revenues and production costs. Corporate and Other includes corporate general and administrative costs. See Note 19 - Segment Information to the 2021 Year End Notes for additional information on our segments.
+Principal Products, Revenues, and Market Overview
+The principal products produced during 2021 and 2020 at the Hycroft Mine were unrefined gold and silver bars (dor ) and gold and silver laden carbons and slags, both of which are sent to third party refineries and sold at prevailing spot prices after adjustments for refining and other associated fees, to financial institutions or precious metals traders. Dor bars and gold and silver laden carbons 
+
+-41-
+
+Table of Contents
+
+and slags are sent to refineries to produce bullion that meets the required market standards of 99.95% pure gold and 99.90% pure silver. Under the terms of our refining agreements, dor bars and gold and silver laden carbons and slags are refined for a fee, and our share of the separately recovered refined gold and refined silver are credited to our account or delivered to our buyers.
+Product Revenues and Customers
+In 2021, revenues from gold and silver recovered from our pre-commercial scale heap leaching operations made up 91% and 9%, respectively, of our total revenue and, as such, we consider gold our principal product. In 2021, all of our revenues were derived from metal sales to two customers; however, we do not believe we have any dependencies on these customers due to the liquidity of the metal markets and the availability of other metal buyers and financial institutions.
+Gold and Silver Uses
+Gold and silver have two main categories of use: fabrication and investment. Fabricated gold has a variety of end uses, including jewelry, electronics, dentistry, industrial and decorative uses, medals, medallions and coins. Fabricated silver also has a variety of end uses, including jewelry, mirrors, cameras, electronics, energy, engines, novelty explosives and coins. Gold and silver investors buy gold and silver bullion, coins and jewelry.
+Gold and Silver Supply and Demand
+The supply of gold consists of a combination of current production from mining and metal recycling and the draw-down of existing stocks of gold held by governments, financial institutions, industrial organizations and private individuals. Based on publicly available information, gold production from mines increased 2% in 2021 compared with 2020 totaling approximately 3,561 metric tons (or 114.5 million troy ounces) and represented approximately 76.3% of the 2021 global gold supply of 4,666 metric tons. According to the World Gold Council, gold demand in 2021 was approximately 4,021 metric tons (or 129.3 million troy ounces) and totaled approximately $232.6 billion in value. In 2021, gold demand by sector was comprised of jewelry (54%), investments including bar and coin and ETFs (26%), central bank purchases (12%), and technology (8%).
+The supply of silver consists of a combination of current production from mining (approximately 80%) and metal recycling and other (approximately 20%). Based on publicly available information, estimated silver production from mines increased approximately 8% in 2021 compared with 2020 totaling approximately 849 million troy ounces and represented approximately 80% of the estimated 2021 global silver supply of 1,056 million troy ounces. Estimated silver demand in 2021 was approximately 1,033 million troy ounces and totaled approximately $25.9 billion in value. In 2021, silver demand by sector was comprised of photovoltaics (10%), other industrial (41%), jewelry (18%), silverware (4%), photography (3%), and investments (24%).
+Gold and Silver Prices
+The price of gold and silver is volatile and is affected by many factors beyond our control, such as the sale or purchase of gold by central banks and financial institutions, inflation or deflation and monetary policies, fluctuation in the value of the U.S. dollar and foreign currencies, global and regional demand, and the political and economic conditions of major gold and silver producing countries throughout the world. The following table presents the annual high, low, and average last reported prices for gold and silver over the past three years on the London Bullion Market (in U.S. dollars per ounce).
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+GOLD PRICES
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+ SILVER PRICES 
+
+Year
+ 
+High
+ 
+Low
+ 
+Average
+ 
+High
+ 
+Low
+ 
+Average
+
+2019
+ 
+$
+ 1,546
+ 
+$
+ 1,270
+ 
+$
+ 1,393
+ 
+$
+ 19.31
+ 
+$
+ 14.38
+ 
+$
+ 16.21
+
+2020
+ 
+$
+ 2,067
+ 
+$
+ 1,474
+ 
+$
+ 1,770
+ 
+$
+ 28.89
+ 
+$
+ 12.01
+ 
+$
+ 20.55
+
+2021
+ 
+$
+ 1,943
+ 
+$
+ 1,684
+ 
+$
+ 1,799
+ 
+$
+ 29.59
+ 
+$
+ 21.53
+ 
+$
+ 25.04
+
+2022 (through May 13)
+ 
+$
+ 2,039
+ 
+$
+ 1,788
+ 
+$
+ 1,887
+ 
+$
+ 26.17
+ 
+$
+ 20.84
+ 
+$
+ 23.92
+
+ 
+On May 13, 2022, the last reported price for gold and silver on the London Bullion Market was $1,812 per ounce and $20.84 per ounce, respectively.
+ 
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+Table of Contents
+
+Competition
+The top 10 producers of gold comprise approximately one third of total worldwide mined gold production. We are a gold and silver development company with a single property. The Hycroft Mine has large gold and silver mineral resources included in the 2022 Hycroft TRS. We have not fully developed our operation and we have not established our long-term production and cost structure. Our costs are expected to be determined by the location, grade and nature of our ore body, processing technologies applied to our ore, and costs including energy, reagents, labor and equipment. The metals markets are cyclical, and our ability to maintain our competitive position over the long-term is based on our ability to develop and cost effectively operate the Hycroft Mine in a safe and environmentally responsible manner.
+We compete with other mining companies in connection with hiring and retaining qualified employees. There is substantial competition for qualified employees in the mining industry, some of which is with companies having substantially greater financial resources than us and a more stable history. As a result, we may have difficulty hiring and retaining qualified employees.
+Employees
+At March 31, 2022, we had approximately 85 employees, of which 78 were employed at the Hycroft Mine. None of our employees are represented by unions.
+COVID-19
+We have implemented health and safety policies for employees, contractors, and visitors that follow guidelines from the CDC and MSHA. During 2021, our operations faced certain limitations due to COVID-19 related absences, however the impact, while negative, did not materially and adversely affect our operations.
+Government Regulation of Mining-Related Activities
+Government Regulation
+Mining operations and exploration activities are subject to various federal, state and local laws and regulations in the United States, which govern prospecting, development, mining, production, exports, taxes, labor standards, occupational health, waste disposal, protection of the environment, mine safety, hazardous substances and other matters. We have obtained or have pending applications for those licenses, permits or other authorizations currently required to conduct our current mining, exploration and other programs. We believe that we are in compliance in all material respects with applicable mining, health, safety and environmental statutes and the regulations passed thereunder in Nevada and the United States. Although we are not aware of any current claims, orders or directions relating to our business with respect to the foregoing laws and regulations, changes to, or more stringent application, interpretation, or enforcement of, such laws and regulations in Nevada, or in jurisdictions where we may operate in the future, could require additional capital expenditures and increased operating and/or reclamation costs, which could adversely impact the profitability levels of our projects.
+Technical Report Summaries ( TRS ) and Qualified Persons
+The scientific and technical information concerning our mineral projects in the 2021 Form 10-K and set forth below have been reviewed and approved by third-party qualified persons under the Modernization Rules, including Ausenco Engineering USA South Inc., Independent Mining Consultants, Inc, and WestLand Engineering & Environmental Services, Inc. For a description of the key assumptions, parameters and methods used to estimate mineral resources set forth below, as well as data verification procedures and a general discussion of the extent to which the estimates may be affected by any known environmental, permitting, legal, title, taxation, sociopolitical, marketing or other relevant factors, please review the 2022 Hycroft TRS, which is filed as Exhibit 96.1 to the registration statement of which this prospectus forms a part and is incorporated by reference herein.
+ 
+
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+
+Table of Contents
+
+DESCRIPTION OF PROPERTY
+Our sole property is the Hycroft Mine. The Hycroft Mine is an existing gold and silver operation located 54 miles west of Winnemucca in Humboldt County and Pershing County, Nevada, as shown in the map below. The Hycroft Mine is accessible via Nevada State Route 49 (Jungo Road), an all-weather, unpaved road that is maintained by Humboldt County and Hycroft. A major east west railway runs immediately adjacent to the property.
+The Hycroft Mine straddles Townships 34, 35, 35 and 36 North and Ranges 28, 29 and 30 East (MDB&M) with an approximate latitude 40 52 north and longitude 118 41 west. The mine is situated on the western flank of the Kamma Mountains on the eastern edge of the Black Rock Desert.
+The Hycroft Mine consists of 30 private parcels with patented claims that comprise approximately 1,912 acres, and 3,247 unpatented mining claims that encompass approximately 68,759 acres. The combined patented and unpatented claims comprise approximately 70,671 acres. The mining claims are comprised of two primary properties, Crofoot and Lewis. The Crofoot and Lewis properties together include approximately 11,829 acres. The Crofoot property covers approximately 3,500 acres and is virtually surrounded by the 8,400 acres of the Lewis property.
+Existing facilities on-site include two administration buildings, a mobile maintenance shop, a light vehicle maintenance shop, a warehouse, three Heap Leach Pads Crofoot, North, and Brimstone, primary, secondary and tertiary crushing systems, two Merrill-Crowe process plants and a refinery. It is considered that existing components of the mine property would be utilized for future development. The Hycroft Mine operates under permit authorizations from the BLM, Nevada Department Environmental Protection, Nevada Department Of Wildlife, Nevada Department of Water Resources and County agencies.
+2022 Hycroft TRS
+In February 2022, we, along with our third-party consultants, completed and filed the 2022 Hycroft TRS prepared in accordance with the Modernization Rules. The 2022 Hycroft TRS provides an Initial Assessment of the mineral resource estimate utilizing a milling and Acid POX process for sulfide mineralization and heap leaching process for oxide and transition mineralization. As a result of the milling and Acid POX process presented in the 2022 Hycroft TRS, as compared to the novel two-step oxidation and heap leach process in the 2019 Hycroft TRS prepared in accordance with the requirements of the Modernization Rules, and the associated fundamental changes to the assumptions underlying the 2019 Hycroft TRS, the 2022 Hycroft TRS supersedes and replaces the 2019 Hycroft TRS and the 2019 Hycroft TRS and information from such 2019 Hycroft TRS should no longer be relied upon. In addition, please see the sections entitled Cautionary Note to U.S. Investors Regarding Mineral Resources , Cautionary Note Regarding Forward-Looking Statements , and Risk Factors when reviewing the information set forth in this section of the prospectus.
+The information that follows relating to the Hycroft Mine is derived, for the most part, from, and in some instances is an extract from, the Initial Assessment 2022 Hycroft TRS. Portions of the following information are based on assumptions, qualifications and procedures that are not fully described herein. Reference should be made to the full text of the 2022 Hycroft TRS which is filed as Exhibit 96.1 to the registration statement of which this prospectus forms a part and is incorporated by reference herein.
+The Company, together with its consultants, has continued to advance work on the mill Acid POX process through 2021 to treat the Hycroft sulfide mineral resource. The mill and Acid POX process remains the focus of ongoing work, as it generates higher gold and silver recoveries than the sulfide heap oxidation and leach process, which will be foundational in optimizing the economics of the deposit. Recoveries become a critical factor when mining begins in the higher-grade silver Vortex deposit. Acid POX recoveries will be further verified with ore-specific variability testing. As the work progressed, the Company also identified several opportunities that may yield significant additional economic benefits to the project.
+Upon furnishing the 2022 Hycroft TRS, the Hycroft Mine had measured and indicated mineral resources of 9.6 million ounces of gold and 446.0 million ounces of silver and inferred mineral resources of 5.0 million ounces of gold and 150.4 million ounces of silver, which are contained in oxide, transitional, and sulfide ores. The Hycroft Mine does not have comparable mineral reserves and mineral resources to provide for the prior year or periods due to changes in its intended mining process and the fact that such information would have been under the 2019 Hycroft TRS that has been superseded and replaced by the 2022 Hycroft TRS. As a result, any meaningful comparison of year-end mineral resources and mineral reserves is not possible.
+
+-44-
+
+Table of Contents
+
+Overview and Highlights
+The 2022 Hycroft TRS summarizes the results of an Initial Assessment and supports the disclosure of mineral resources at the Hycroft Mine utilizing a milling and acid POX process for sulfide mineralization and heap leaching process for oxide and transition mineralization. The work has been prepared at the request of the Company and completed by third-party consultants including Ausenco Engineering USA South Inc. ( Ausenco ), Independent Mining Consultants, Inc. ( IMC ), and WestLand Engineering & Environmental Services, Inc. ( Westland ). Employees of IMC and Ausenco who have worked on and approved this mineral resource estimate are Qualified Persons as defined under the Modernization Rules.
+After evaluating the information obtained, and carefully considering the numerous and significant opportunities developed during the assessment process that warrant follow-up analysis and work, coupled with the highly inflationary environment for equipment and cost inputs, the Company filed the 2022 Hycroft TRS as an Initial Assessment. The 2022 Hycroft TRS supersedes all previous technical studies. As a result of the milling and Acid POX process presented in the 2022 Hycroft TRS, as compared to the novel two-step oxidation and heap leap process in the 2019 Hycroft TRS, and the associated fundamental changes to the assumptions underlying the 2019 Hycroft TRS, our ongoing disclosures will be based on the 2022 Hycroft TRS and not the 2019 Hycroft TRS. The Company will continue to build on the work to date and investigate opportunities identified through progressing the technical and data analyses leading up to the Initial Assessment and will provide an updated technical report at an appropriate time.
+The mineral resource is based on information provided by the Company which has been checked and validated wherever possible by IMC. The calculations and interpretations presented here are the work of IMC, who takes responsibility for the published mineral resource.
+Hycroft Mine
+The Hycroft Mine and related facilities are located approximately 54 miles west of Winnemucca, Nevada. Winnemucca, a city with a population of approximately 8,431 (2020 Census data), is a commercial community on Interstate 80, 164 miles northeast of Reno. The mine property straddles Townships 34, 35, 351 2 and 36 North and Ranges 28, 29 and 30 East (MDB&M) with an approximate latitude 40 52 north and longitude 118 41 west.
+
+-45-
+
+Table of Contents
+
+The following shows the location of our properties.
+ 
+
+-46-
+
+Table of Contents
+
+Additionally, the following map shows the current property and facilities layout.
+
+The town is served by a transcontinental railroad and has a municipal airport. Access to the Hycroft Mine from Winnemucca is by Jungo Road, formerly designated as State Route 49, a good-quality, unpaved road, and a short access road to the main entrance of the mine. Well-maintained mine and exploration roads provide access throughout the property. Access is also possible from Imlay, Gerlach and Lovelock by unpaved roads intersecting Interstate 80 and Nevada State Route 447. The majority of our employees live in the Winnemucca area. The site receives electrical power provided by NV Energy from the northwestern Nevada power grid. Initial surveys indicate that the town of Winnemucca has the required infrastructure (shopping, emergency services, schools, etc.) to support the maximum workforce and dependents. The Hycroft Mine currently has water rights which we believe is adequate to support potential future operations. The mine is situated on the eastern edge of the Black Rock Desert and on the western flank of the Kamma 
+
+-47-
+
+Table of Contents
+
+Mountains between Winnemucca and Gerlach, Nevada. There are no streams, rivers or major lakes in the general area. Elevations in the mine area range between 4,500 and 5,500 feet above sea level.
+The climate of the region is arid, with precipitation averaging 7.7 inches per year. Average temperatures during the summer range from 50 F to 90 F and average winter temperatures range from 20 F to 40 F.
+The Hycroft Mine property consists of 30 private parcels with patented claims that comprise 1,912 acres, and 3,247 unpatented mining claims that encompass 68,759 acres. Combining the patented and unpatented claims, total claims cover approximately 70,671 acres. The Hycroft Mine patented claims occupy private lands and our unpatented claims occupy public lands, administered by the BLM. These claims are governed by the laws and regulations of the U.S. federal government and the State of Nevada. To maintain the patented claims in good standing, we must pay the annual property tax payments to the county in which the claims are held. To maintain the unpatented claims in good standing, we must file a notice of intent to maintain the claims within the county and pay the annual mineral claim filing fees to the BLM. Such filing fees amounted to $0.6 million in 2021. As long as we file the annual notice and pay the claim filing fees, there is no expiration date for our unpatented claims.
+A portion of the Hycroft Mine is subject to a mining lease requiring us to pay 4% net profit royalty to the owner of certain patented and unpatented mining claims, subject to a maximum of $7.6 million, of which $3.0 million has been satisfied and $4.6 million remained outstanding as of December 31, 2021. There is no expiration date on the net profit royalty.
+The Hycroft Mine is also subject to the Sprott Royalty Agreement and that requires us to pay a perpetual royalty equal to 1.5% of the Net Smelter Returns, as such term is defined in such agreement, from our Hycroft Mine. There is no expiration and no limit on the amount that can be paid on the Sprott Royalty Agreement.
+The Hycroft Mine was formerly known as the Crofoot-Lewis open pit mine, which was a small heap leaching operation that commenced in 1983. Vista Gold Corp., a corporation incorporated under the laws of the Yukon Territory ( Vista ), acquired the Crofoot-Lewis claims and mine in 1987 and 1988. During this first operating period the mine produced over 1.0 million ounces of gold and 2.5 million ounces of silver. The mine production continued until it was placed on a care and maintenance program in December 1998 due to low gold prices. Seller acquired the Hycroft Mine in 2007 pursuant to an arrangement agreement where Vista transferred its Nevada mining properties to Seller s predecessor. Seller restarted the Hycroft Mine in 2008 and suspended mining operations on July 8, 2015. During 2016, Seller was actively processing and producing gold from the ore within the heap leach pads. On January 1, 2017, Seller went into a care and maintenance mode when it stopped adding lime to the leach pads and continued to operate in a care and maintenance mode throughout 2017 and 2018. Prior to restarting operations, production of gold and silver was a byproduct of Seller s maintenance activities on the Hycroft Mine. In December 2018, Seller began restart activities, including the rehabilitation of the crushing facility and construction of a new leach pad, with active mining operations beginning in the second quarter of 2019 with six haul trucks, two hydraulic shovels and one wheel loader. Initial gold and silver production occurred in August 2019 and continued until the Company ceased active mining operations in November 2021.
+On site facilities include an administration building, mobile maintenance shop, light vehicle maintenance shop, warehouse, five leach pads, crushing system, two Merrill-Crowe process plants and a refinery. The components for a second refinery are on-site and will be constructed as part of the expansion of mining activities. The crushing system was refurbished as part of the restart activities and all other facilities are operational with the exception of the North Merrill-Crowe plant, which will be rehabilitated and brought on line as is required. The gross book value of plant and equipment associated with the Hycroft Mine as of December 31, 2021, was $88.2 million.
+Geology and Mineralization
+The Hycroft Mine is located on the western flank of the Kamma Mountains. The deposit is hosted in a volcanic eruptive breccia and conglomerates associated with the Tertiary Kamma Mountain volcanics. The volcanics are mainly acidic to intermediate tuffs, flows and coarse volcanoclastic rocks. Fragments of these units dominate the clasts in the eruptive breccia. The Central Fault and East Fault control the distribution of mineralization. A post-mineral range-front fault separates the ore-body from the adjacent Pleistocene Lahontan Lake sediments in the Black Rock Desert. The geological events have created a physical setting ideally suited to the open-pit, heap-leach mining operation at the Hycroft Mine. The heap leach method is widely used in the southwestern United States and allows the economical treatment of oxidized low-grade ore deposits in large volumes. The Company is currently contemplating a milling and Acid POX process that is commonly used worldwide to treat refractory sulfide ores.
+
+-48-
+
+Table of Contents
+
+The deposit is typically broken into six major zones based on geology, mineralization, and alteration. These zones include Brimstone, Vortex, Central, Bay, Boneyard, and Camel. Breaks between the zones are major faults.
+Mineralization at Hycroft has been deposited through multiple phases. An early silica sulfide flooding event deposited relatively low-grade gold and silver mineralization generally along bedding. This mineralization is cross cut by later, steeply dipping quartz alunite veins. Late-stage silver bearing veins are found in the Vortex zone and at depth in the Central area. Late to present supergene oxidation along faults has liberated precious metals from sulfide mineralization and further enriched gold and silver mineralization, along water table levels.
+The known gold mineralization extends for a distance of three miles in a north-south direction by 1.5 miles in an east-west direction. Mineralization extends to a depth of less than 330 feet in the outcropping to near-outcropping portion of the deposit on the northwest side to over 2,500 feet in the Vortex deposit in the east.
+Drilling
+The Hycroft mineral resource model includes data from 1981 to 2018 and includes 5,501 holes, representing 2,482,722 ft of drilling. There have been 5,576 drill holes reported completed in the Hycroft project area; some are water wells or are outside the resource model domain and were not applied to estimation. As of February 18, 2022, there were 5,323 drill holes in the resource model area of which 134 have been drilled to define stockpiles or the Crofoot leach pad.
+
+-49-
+
+Table of Contents
+
+Drill hole collar locations are shown in the figure below.
+
+Consistent with Seller s suspension of mining operations and conducting only care and maintenance activities on the Hycroft Mine, during 2017 and through December 2018, only drilling to obtain ore for metallurgical testing purposes was conducted. In December 2018, Seller began confirmation drilling of certain sulfide ore stockpiles that we planned to mine.
+
+-50-
+
+Table of Contents
+
+Any expansion of the Hycroft Mine necessary to exploit any additional mineral resources that may be established through our exploration drilling program beyond the mineral resources in the 2022 Hycroft TRS, will require us to obtain all permits, approvals and consents of regulatory agencies responsible for the use and development of mines in Nevada.
+Measured, Indicated and Inferred Mineral Resources
+Our mineral resource estimates are calculated in accordance with the Modernization Rules. Measured, indicated and inferred mineral resources may not be comparable to similar information regarding mineral resources disclosed in accordance with the guidance of other countries. The estimates of mineral resources may be materially affected if mining, metallurgical, or infrastructure factors change from those currently anticipated at the Hycroft Mine. Estimates of inferred mineral resources have significant geological uncertainty and it should not be assumed that all or any part of an inferred mineral resource will be converted to the measured or indicated categories. Mineral resources that are not mineral reserves do not meet the threshold for reserve modifying factors, such as estimated economic viability, that would allow for conversion to mineral reserves. The Hycroft Mine contains a large precious metals deposit, based on measured and indicated mineral resource size. The mineral resource estimates were prepared by and are the responsibility of IMC, as set forth in the 2022 Hycroft TRS.
+The following description of the Hycroft Mine measured, indicated and inferred mineral resources does not purport to be complete and is subject to, and qualified in its entirety by reference to, the full text of the 2022 Hycroft TRS, which is filed as Exhibit 96.1 to the registration statement of which this prospectus forms a part and is incorporated by reference herein.
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+Cutoff
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+Au
+ 
+Ag
+
+ 
+ 
+Grade
+ 
+Approximate
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+Contained
+ 
+Contained
+
+ 
+ 
+$Net of
+ 
+Cutoff, AuEq
+ 
+ 
+ 
+Au
+ 
+Ag
+ 
+Sulfide
+ 
+Ounces
+ 
+Ounces
+
+Classification
+ 
+Process
+ 
+oz/ton
+ 
+Ktons
+ 
+oz/ton
+ 
+oz/ton
+ 
+Sulfur%
+ 
+(000)
+ 
+(000)
+
+Heap Leach
+
+Measured
+ 
+$
+ 0.01
+ 
+ 0.003
+ 
+ 97,086
+ 
+ 0.008
+ 
+ 0.30
+ 
+ 2.75
+ 
+ 777
+ 
+ 29,417
+
+Indicated
+ 
+$
+ 0.01
+ 
+ 0.003
+ 
+ 36,046
+ 
+ 0.007
+ 
+ 0.29
+ 
+ 2.10
+ 
+ 252
+ 
+ 10,417
+
+Meas + Ind
+ 
+$
+ 0.01
+ 
+ 0.003
+ 
+ 133,132
+ 
+ 0.008
+ 
+ 0.30
+ 
+ 2.57
+ 
+ 1,029
+ 
+ 39,834
+
+Inferred
+ 
+$
+ 0.01
+ 
+ 0.003
+ 
+ 101,314
+ 
+ 0.008
+ 
+ 0.09
+ 
+ 1.77
+ 
+ 811
+ 
+ 9,118
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Mill, Flotation Concentrate, POX and Cyanide Leach Process Plant
+
+Measured
+ 
+$
+ 0.01
+ 
+ 0.011
+ 
+ 372,226
+ 
+ 0.013
+ 
+ 0.65
+ 
+ 1.86
+ 
+ 4,839
+ 
+ 240,830
+
+Indicated
+ 
+$
+ 0.01
+ 
+ 0.011
+ 
+ 314,866
+ 
+ 0.012
+ 
+ 0.53
+ 
+ 1.65
+ 
+ 3,778
+ 
+ 165,305
+
+Meas + Ind
+ 
+$
+ 0.01
+ 
+ 0.011
+ 
+ 687,092
+ 
+ 0.013
+ 
+ 0.59
+ 
+ 1.76
+ 
+ 8,617
+ 
+ 406,135
+
+Inferred
+ 
+$
+ 0.01
+ 
+ 0.011
+ 
+ 349,659
+ 
+ 0.012
+ 
+ 0.40
+ 
+ 1.19
+ 
+ 4,196
+ 
+ 141,262
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Combined Mineral Resources - Heap Leach Plus Process Plant
+
+Measured
+ 
+$
+ 0.01
+ 
+0.003 - 0.011
+ 
+ 469,312
+ 
+ 0.012
+ 
+ 0.58
+ 
+ 2.04
+ 
+ 5,616
+ 
+ 270,247
+
+Indicated
+ 
+$
+ 0.01
+ 
+0.003 - 0.011
+ 
+ 350,912
+ 
+ 0.011
+ 
+ 0.50
+ 
+ 1.70
+ 
+ 4,030
+ 
+ 175,722
+
+Meas + Ind
+ 
+$
+ 0.01
+ 
+0.003 - 0.011
+ 
+ 820,224
+ 
+ 0.012
+ 
+ 0.54
+ 
+ 1.90
+ 
+ 9,646
+ 
+ 445,969
+
+Inferred
+ 
+$
+ 0.01
+ 
+0.003 - 0.011
+ 
+ 450,973
+ 
+ 0.011
+ 
+ 0.33
+ 
+ 1.32
+ 
+ 5,007
+ 
+ 150,380
+
+ 
+Notes:
+ Cutoffs grades were determined by income process cost = NPR = NSR Process Opex. Cutoff grade is the minimum grade required for a mineral to be economically mined and processed to retrieve the metal for commercial sale. The cutoff grade for Hycroft is determined by assessing each mine block for gold and silver content and then applying a cost for extraction of these metals from that block by employing commercial mining practices and using the crushing, grinding, flotation, pressure oxidation and cyanide leaching circuit for oxidized flotation concentrate process to create a gold / silver dore bar. Process costs include the environmental practices for placing waste and tailing material in properly designed facilities that can be remediated in the future.
+ Numbers in the table have been rounded to reflect the accuracy of the estimate and may not sum due to rounding.
+
+-51-
+
+Table of Contents
+
+ Mineral resources are contained within a computer generated optimized pit. Total material in that pit is 3.516 billion tons.
+ All units are imperial. Ktons refers to 1,000 short tons of 2,000 lbs. Gold and silver grades are in troy ounces/short ton.
+Mineral resources were developed based on a conventional computer-based block model of the deposit and the application of open pit optimization software to determine the mineralization with reasonable expectation of economic extraction. Each block was evaluated to determine which process provides the best net return after operating cost. The two processes identified were:
+ Run-of-Mine ( ROM ) cyanide heap leaching of oxide ore; and
+ milling, flotation and acid pressure oxidation of sulfide and transitional ores followed by cyanide leach and processing in a Merrill-Crowe facility.
+Other assumptions used to develop measured, indicated and inferred mineral resources were:
+ assumed prices for gold of $1,800 per ounce and for silver of $23 per ounce;
+ recoveries for gold and silver were estimated by process type:
+ 
+milling, flotation and acid pressure oxidation was 76% overall of the fire assays for gold and 76% for fire assays for silver; and
+
+ 
+ROM heap leaching was 75% for cyanide soluble gold and 12.2% for fire assay silver;
+
+ base mining cost of $1.45 per ton with an additional incremental $0.016/ton applied to each bench below the 4660 level;
+ variable ore processing costs based on geometallurgical domains and sulfur content; and
+ general and administrative cost $0.75 per ton.
+See Table 11-15 in Section 11 of the 2022 Hycroft TRS for a more detailed presentation of the economic parameters for mineral resource estimation.
+Mineral resources are not mineral reserves and detailed economic considerations have not been applied. Modifying factors for mine and process design have not been applied.
+Internal Controls and Material Assumptions
+IMC developed and updated the block model for the 2022 Hycroft TRS. Below is the summary of the work and checks they used to develop the block model.
+The Hycroft resource model includes data from 1981 to 2018 and includes 5,501 holes, representing 2,482,722 ft of drilling. There have been 5,576 drill holes reported completed in the Hycroft Project Area; some are water wells or are outside the resource model domain and were not applied to estimation. The drillhole collar locations are shown in the 2022 Hycroft TRS and later in this text. At this time, there are 5,323 drill holes in the resource model area of which 134 have been drilled to define stockpiles or the Crofoot leach pad.
+In addition to drilling activity, the Company has also conducted geophysical surveys, soil and rock chip sampling programs, field mapping, historical data compilation, and regional reconnaissance at the Hycroft Mine site. These efforts are designed to improve the understanding of the known mineralization, as well as provide data for further exploration of the greater property position.
+A soil sampling grid was conducted over the Vortex and Brimstone areas historically (1,797 samples) and was extended approximately 5,200 ft north and 29,600 ft south of the mine in 2011 2012 (1,834 samples). The soil sampling program was 
+
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+
+Table of Contents
+
+conducted primarily along the East Fault exposure, which is a primary ore-controlling feature at Vortex and Brimstone. Soil samples are taken on an evenly spaced grid, and screened for coarse material and wind-blown material, resulting in a fraction between 2 mm and 180 um being prepped for analysis. These samples are considered representative of local soil geochemistry and are used to guide the regional exploration effort.
+Rock chip sampling has been conducted both historically in the active mine area, and on a regional basis (2007 present). A database of 2,416 samples has been compiled, covering the greater land position. Au values range from 0 to 0.372 oz/ton, while Ag values range from 0 to 71.8 oz/ton. Rock chip samples have been taken on most outcrops, with a focus on alteration and potential mineralization. These samples are used as a guide to exploration and are point samples only.
+The land position has been surveyed with both gravity and induced polarity (IP) geophysical techniques by Hycroft. The current ground-based gravity survey covers approximately 130 square miles, centered on the mine site. Gravity indicates several structural features and density changes. Gravity has also defined the basin edge to the west, approximately 4 miles west of the Brimstone Pit.
+Ground IP surveys were run over the mine site and Vortex in 2007 and extended outward in 2011 to cover approximately 24 square miles. The survey results focus on chargeability anomalies, that potentially identify sulfide material (> approximately 1.5%) at depth, and resistivity anomalies, that potentially identify silicification at depth.
+Field mapping was historically and is currently carried out in all active mine areas. Mapping focuses on structure, bedding, joints, lithology, and alteration. The near mine data is incorporated into the three-dimensional geology model, while the regional work is focused on defining exploration targets for future drilling. A regional geology map covering the land position was compiled in 2012.
+The drillhole database was assembled over many years by multiple companies using at least four different drill methods.
+The gold assay values in the Hycroft legacy database prior to 2000 were stated to be historically factored upward by a factor of 1.19. Prior to this resource model estimation, that factor was removed by multiplying all gold assays prior to 2000 by 1/1.19 = 0.8403. The removal of the factor does not have substantial impact on the deeper sulfide mineralization component of the deposit, but it does remove an observed sample bias in the near surface data.
+There are stockpiles and historical leach pads at the Hycroft Mine that are within the block model area. Many of those have been drilled after the original excavation of hard rock by sonic or rotary methods. The stockpile holes have been used to estimate the stockpile and leach pad areas, they have not been used to estimate in-situ rock. In total, the Hycroft database contains 5,377 drill holes with 500,960 sample intervals. Within the area of the block model, there are 5,323 drill holes with 493,357 drill intervals amounting to 2,838,923 ft of drilling.
+The block model was verified by several methods before being used to determine mineral resource, including:
+ detailed Visual Checks of Drilling versus Block Estimates;
+ swath Plots;
+ IMC Smear Check; and
+ reconciliation to production history.
+IMC completed visual checks on plan and section for all of the estimated variables in the model. In addition to IMC visual checks, the Hycroft engineering and geology team on site also reviewed the model and assisted IMC with identifying and correcting coding issues prior to finalizing the block model.
+Swath plots are a practice now common among resource modelers to provide a visual indication if the block model follows the grade trends indicated by the supporting data and if there is any observable local bias in the block grade estimation.
+
+-53-
+
+Table of Contents
+
+Quality assurance and quality control methods utilized in the 2022 Hycroft TRS included the use of a test by IMC to understand the amount of grade smoothing within the block model and to confirm that the model grades are not high biased, referred to internally as the smear check. 
+The procedure utilized by IMC was as follows:
+ a range of cutoff grades were selected for the check process, generally bracketing the potential planning cutoff grades;
+ for each cutoff grade being tested, the blocks above cutoff were identified;
+ all composites contained within those blocks were identified;
+ the average grade of the composites and blocks were tabulated; and
+ the percentage of the contained composites less than cutoff were calculated.
+IMC completed a reconciliation of the model against 19 months of reported production for the year ended December 31, 2020 and for the seven months ended July 31, 2021. The reported 2019 production from Hycroft included substantial stockpile reclaim that would not be indicative of the block model response. The 19-month time period for the test is relatively short with a total of 13,584 Ktons of oxide ore delivered to the leach pad. This represented approximately 65% of processing the sulfide mineralized materials for one year.
+During 2020, Hycroft delivered ROM to the leach pad and crush leach to the crusher prior to loading on the pad. Sulfide material that was being considered for a sulfide atmospheric leach was stockpiled for future processing. Hycroft provided IMC with calculations for materials control routing that are used at site. Those methods were set up for application to the 2021 block model by IMC.
+Some modifications were made by IMC during the installation of the materials control procedure. During 2021, Hycroft stopped crushing leached oxide ore and shipped ROM oxide ore only to the pad. IMC assumed that material that would report to crush leach would instead be shipped directly as ROM to the pad.
+Hycroft provided surface files that reflect the mine survey progress. The surface files were used to measure the material within the block model for each of the time periods at the cutoffs reportedly applied during the control.
+Tonnage from the model is about 4% less than reported by the materials control. Gold grade is substantially lower than the materials control grade from blast holes.
+A check of the database composites contained within the materials control shapes indicate that average of the composites contained in the materials control are less than the materials control grade and match the predicted grade from the block model. As a result, the composite data could not generate a gold grade as high as that reported by materials control. The difference may be due to smaller selective mining units or blast hole bias. In summary, the data within the mining shapes could not support grades that are different from those estimated in the model.
+Cautionary Note to U.S. Investors Regarding Mineral Resources
+The mineral resource estimates included herein or incorporated by reference herein, including in the 2022 Hycroft TRS, have been prepared in accordance with the requirements of the Modernization Rules as set forth in subpart 1300 of Regulation S-K which became widely applicable on January 1, 2021. These disclosures differ in material respects from the prior requirements set forth in Industry Guide 7, including in that mineral resource information was not permitted and mineral resources have been calculated in accordance with the provision of subpart 1300 of Regulation S-K. These standards differ significantly from the disclosure requirements of Industry Guide 7 in that mineral resource information contained herein may not be comparable to similar information disclosed by U.S. companies that have not implemented the Modernization Rules promulgated by the SEC. Under SEC standards, mineralization, such are mineral resources, may not be classified as a mineral reserve unless the determination has been made that 
+
+-54-
+
+Table of Contents
+
+the mineralization could be economically and legally produce or extracted at the time of the reserve determination. However, for a reserve to exist, we must have a justifiable expectation, based on applicable laws and regulations, that issuance of permits or resolution of legal issues necessary for mining and processing at a particular deposit will be accomplished in the ordinary course and in a timeframe consistent with our current mine plans. The terms mineral resource , measured mineral resource , indicated mineral resource and inferred mineral resource are defined and used in accordance with the Modernization Rules. You are specifically cautioned not to assume that any part or all of the mineral deposits (including mineral resources) in these categories will ever be converted into mineral reserves, as defined by the SEC. You are further cautioned that, except for any portion of mineral resources, as applicable, classified as mineral reserves, mineral resources do not have demonstrated economic value. Inferred mineral resources have a high degree of uncertainty as to their existence as to whether they can be economically or legally mined without further work and analysis. Under the Modernization Rules, estimates of inferred mineral resources may not form the basis of an economic analysis. It cannot be assumed that all or any part of an inferred mineral resource will ever be upgraded to a higher category. A significant amount of exploration must be completed in order to determine whether an inferred mineral resource may be upgraded to a higher category. Therefore, you are cautioned not to assume that all or any part of an inferred mineral resource exists, that it can be economically or legally mined, or that it will ever be upgraded to a higher category without further work and analysis. Likewise, you are cautioned not to assume that all or any part of measured or indicated mineral resources will be upgraded to mineral reserves.
+Technical Report Summaries and Qualified Persons
+The scientific and technical information concerning our mineral properties in this prospectus have been reviewed and approved by third-party qualified persons under the Modernization Rules, including Ausenco, IMC and WestLand. For a description of the key assumptions, parameters and methods used to estimate mineral resources included in this prospectus, as well as data verification procedures and a general discussion of the extent to which the estimates may be affected by any known environmental, permitting, legal, title, taxation, sociopolitical, marketing or other relevant factors, please review the 2022 Hycroft TRS attached as Exhibit 96.1 to the registration statement of which this prospectus forms a part and incorporated by reference herein.
+ENVIRONMENTAL REGULATION
+Environmental Regulation
+Our mining projects are subject to various federal and state laws and regulations governing protection of the environment. These laws and regulations are continually changing and, in general, are becoming more restrictive. The federal laws and regulations, among other things:
+ impose strict, joint and several liability on current and former owners and operators of sites and on persons who disposed of or arranged for the disposal of hazardous substances found at such sites (the Comprehensive Environmental Response, Compensation, and Liability Act);
+ govern the generation, treatment, storage and disposal of solid waste and hazardous waste (the Federal Resource Conservation and Recovery Act);
+ restrict the emission of air pollutants from many sources, including mining and processing activities (the Clean Air Act);
+ require federal agencies to integrate environmental considerations into their decision-making processes by evaluating the environmental impacts of their proposed actions, including the issuance of permits to mining facilities and assessing alternatives to these actions (the National Environmental Policy Act);
+ regulate the use of federal public lands to prevent undue and unnecessary degradation of the public lands (the Federal Land Policy and Management Act of 1976);
+ restrict and control the discharge of pollutants and dredged and fill materials into waters of the United States (the Clean Water Act); and
+
+-55-
+
+Table of Contents
+
+ regulate the drilling of subsurface injection wells (the Safe Drinking Water Act and the Underground Injection Control Program promulgated thereunder).
+We cannot predict at this time what changes, if any, to federal laws or regulations may be adopted or imposed by the current governmental administration. At the state level, mining operations in Nevada are regulated by the Nevada Department of Conservation and Natural Resources, Division of Environmental Protection (the Division ), which has the authority to implement and enforce many of the federal regulatory programs described above as well as state environmental laws and regulations. Compliance with these and other federal and state laws and regulations could result in delays in obtaining, or failure to obtain, government permits and approvals, delays in beginning or expanding operations, limitations on production levels, incurring additional costs for investigation or cleanup of hazardous substances, payment of fines, penalties or remediation costs for non-compliance, and post-mining closure, reclamation and bonding.
+It is our policy to conduct business in a way that safeguards our employees, public health and the environment. We believe that our operations are, and will be, conducted in material compliance with applicable laws and regulations. However, our past and future activities in the United States may cause us to be subject to liability under such laws and regulations. For information about the risks to our business related to environmental regulation, please see Risk Factors - Industry Related Risks
+ Environmental regulations could require us to make significant expenditures or expose us to potential liability ; We are subject to numerous governmental permits that are difficult to obtain and we may not be able to obtain or renew all of the permits we require, or such permits may not be timely obtained or renewed ; Failure to comply with environmental regulations could result in penalties and costs ; and Compliance with current and future government regulations may cause us to incur significant costs in this prospectus above.
+During 2021 and 2020, there were no known material environmental incidents or non-compliance with any applicable environmental regulations on the properties now held by us. We did not incur material capital expenditures for environmental control facilities during 2021 and 2020 and do not expect to incur any material expenditures in 2022 for such environmental control facilities.
+Reclamation
+We are required to mitigate long-term environmental impacts by amending, backfilling, stabilizing, contouring, re-sloping and re-vegetating various portions of a site after mining and mineral processing are completed, mitigating potential impacts to surface water and groundwater resources. These reclamation efforts will be conducted in accordance with detailed plans, which must be reviewed and approved by the appropriate regulatory agencies. Our reclamation obligations at the Hycroft Mine are secured by surface management surety bonds that meet the financial assurance requirements of the State of Nevada and the Bureau of Land Management ( BLM ). Our most recent reclamation cost estimate was approved by the BLM and the State of Nevada in July 2020. At December 31, 2021, our surface management surety bonds totaled $59.3 million, of which $58.3 million secures the financial assurance requirements for the Hycroft Mine, and $1.0 million secures the financial assurance requirements for the adjacent water supply well field and exploration project. Based on the December 31, 2021 estimate, no material reclamation expenditures are expected to be incurred until after mining and mineral processing are completed. If we incur additional long-term environmental impacts from future mining activities, we will likely have additional reclamation obligations as well as additional financial assurance requirements. For our existing obligations, as well as any future obligations we may incur we may choose to engage in reclamation activities before mining and mineral processing are completed, but these expenses are not anticipated to be material to the overall reclamation obligation. When we perform reclamation work in the future, the work will be planned to conform to our mining operations and will be required to be documented when completed under our governing permits with the government regulatory agencies. The reclamation obligation would be adjusted accordingly as allowed under current regulations, and the financial assurance requirements would be adjusted to account for the completed reclamation work. If we are required to comply with material unanticipated financial assurance requirements in the future, our financial position could be adversely affected, or our posted financial assurance may be insufficient. For financial information about our estimated future reclamation costs refer to Note 13 - Asset Retirement Obligation to our 2021 Year End Financial Statements.
+Mine Safety and Health Administration Regulations
+Safety and health is a core value which is why we have mandatory mine safety and health programs that include employee and contractor training, risk management, workplace inspection, emergency response, accident investigation and program auditing. We 
+
+-56-
+
+Table of Contents
+
+consider these programs to be essential at all levels to ensure that our employees, contractors, and visitors only operate in a safe and healthy workplace.
+Our operations and exploration properties are subject to regulation by the MSHA under the Federal Mine Safety and Health Act of 1977 (the Mine Act ). Pursuant to Section 1503(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the Dodd-Frank Act ), issuers are required to disclose specified health and safety violations, orders and citations, related assessments and legal actions, and mining-related fatalities in periodic reports. MSHA inspects our mines on a regular basis and issues various citations and orders when it believes a violation has occurred under the Mine Act. The number of citations and orders charged against mining operations in the U.S., and the dollar penalties assessed for such citations, have generally increased in recent years. 
+Property Interests and Mining Claims
+Our development activities are conducted in the State of Nevada. Mineral interests in Nevada may be owned by the United States, the State of Nevada, or private parties. Where prospective mineral properties are held by the United States, mineral rights may be acquired through the location of unpatented mineral claims upon unappropriated federal land. Where prospective mineral properties are owned by the State of Nevada or private parties, some type of property acquisition agreement is necessary in order for us to explore or develop such property. Mining claims are subject to the same risk of defective title that is common to all real property interests. Additionally, mining claims are self-initiated and self-maintained and, therefore, possess some unique vulnerabilities not associated with other types of property interests. It is impossible to ascertain the validity of unpatented mining claims solely from an examination of the public real estate records and, therefore, it can be difficult or impossible to confirm that all of the requisite steps have been followed for location and maintenance of a claim. For general information about our mineral properties and mining claims please see Description of Property above. For information about the risks to our business related to our property interests and mining claims, see the following risk factors in Risk Factors - Industry Related Risks There are uncertainties as to title matters in the mining industry. Any defects in such title could cause us to lose our rights in mineral properties and jeopardize our business operations ; and Legislation has been proposed periodically that could, if enacted, significantly affect the cost mine development in our unpatented mining claims in this prospectus above.
+LEGAL PROCEEDINGS
+From time to time we may be involved in various legal actions related to our business, some of which are class action lawsuits. We do not believe, based on currently available information, that contingencies related to any pending or threatened legal matter will have a material adverse effect on our consolidated financial statements, although a contingency could be material to our results of operations or cash flows for a particular period depending on our results of operations and cash flows for such period. Regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors.
+MARKET PRICE OF AND DIVIDENDS ON COMMON STOCK
+AND RELATED STOCKHOLDER MATTERS
+Market Information
+Our common stock began publicly trading on the Nasdaq Capital Market under the symbol HYMC on June 1, 2020. Prior to that time, shares of Class A common stock traded on the Nasdaq Capital Market under the symbol MUDS .
+On May 13, 2022, the last reported sale price of our Common Stock on the Nasdaq Capital Market was $1.34. As of May 13, 2022, there were 197,029,741 shares of our common stock issued and outstanding, and we had 75 registered stockholders of record.
+ 
+
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+
+Table of Contents
+
+Dividend Policy
+We have never paid dividends on our common stock and currently have no plans to do so. The Sprott Credit Agreement, as amended and restated by the Second A&R Agreement, contains provisions that restrict our ability to pay dividends. For additional information on these restrictions, please see Management s Discussion and Analysis of Financial Condition and Results of Operations Debt covenants in this prospectus and Note 10 - Debt, Net to the 2021 Year End Notes.
+Issuer Purchases of Equity Securities
+During year ended December 31, 2021, we did not purchase any of our equity securities that are registered under Section 12(b) of the Exchange. The Sprott Credit Agreement, as amended and restated by the Second A&R Agreement, contains provisions that restrict our ability to repurchase or redeem our capital stock.
+Unregistered Sales of Equity Securities and Use of Proceeds
+On October 6, 2021, the Company agreed to issue an aggregate of up to 275,000 shares of our Common Stock as consideration for entering into a Waiver and Amendment to the Transition and Succession Agreement with Randy Buffington, the former Chairman of the Board, President and Chief Executive Officer of the Company. The Waiver and Amendment terminated the remaining unpaid cash payments to Mr. Buffington pursuant to the Transition and Succession Agreement and Consulting Agreement in the aggregate amount of $0.7 million, in exchange for the issuance. On October 8, 2021, 137,500 shares of Common Stock with a grant date fair value of $0.2 million were issued to Randy Buffington, with the remaining 137,500 shares of Common Stock to be issued on June 30, 2022.
+On March 14, 2022, the Company entered into the Subscription Agreements with each of AMC and Eric Sprott, pursuant to which the Company agreed to sell to them in the 2022 Private Placement, an aggregate of 46,816,480 Units at a purchase price per Unit of $1.193, with each Unit consisting of one share of Common Stock and one New Warrant and the Warrant Shares issuable upon exercise of the New Warrants, providing for a total purchase price of approximately $55.9 million. The New Warrants issued in the 2022 Private Placement have an exercise price of $1.068 per Warrant Share, and will expire five years after issuance. The closing of the sales of Units pursuant to the Subscription Agreements occurred on March 15, 2022 for gross proceeds to the Company of approximately $55.9 million.
+MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
+AND RESULTS OF OPERATIONS
+The following discussion, which has been prepared based on information available to us as of May 4, 2022, provides information that we believe is relevant to an assessment and understanding of our consolidated operating results and financial condition. As a result of the completion of the Recapitalization Transaction, the financial statements of Seller are now the financial statements of the Company. Prior to the Recapitalization Transaction, the Company had no operating assets but, upon consummation of the Recapitalization Transaction, the business and operating assets of Seller sold to the Company became the sole business and operating assets of the Company. Accordingly, the financial statements of Seller and its subsidiaries as they existed prior to the Recapitalization Transaction and reflecting the sole business and operating assets of the Company going forward, are now the financial statements of the Company. The following discussion should be read in conjunction with our other reports filed with the SEC as well as our 2021 Year End Financial Statements and the 2021 Year End Notes and First Quarter Financial Statements and Notes to First Quarter Financial Statements. Terms not defined herein have the same meaning defined in the First Quarter Financial Statements and the Notes to First Quarter Financial Statements.
+The following MD&A generally discusses our consolidated financial condition and results of operations for the three months ended March 31, 2022 and March 31, 2021 and year-to-year comparisons between 2022 and 2021 as well as for the twelve months ended December 31, 2021 and December 31, 2020 and year-to year comparisons between 2021 and 2020.
+Introduction to the Company
+We are a U.S.-based gold and silver company that is focused on developing our wholly owned Hycroft Mine in a safe, environmentally responsible, and cost-effective manner. Gold and silver sales represent 100% of our revenues and the market prices of 
+
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+
+Table of Contents
+
+gold and silver significantly impact our financial position, operating results, and cash flows. The Hycroft Mine is located in the State of Nevada and the corporate office is located in Winnemucca, Nevada. We recently filed the 2022 Hycroft TRS which contemplates processing gold and silver ore using milling and pressure oxidation to process sulfide ore along with heap leaching to process oxide and transition ore.
+As discussed throughout this MD&A, including within the Hycroft Mine section, during the year ended December 31, 2021, while we have been able to achieve or improve on certain of our internal operating, processing, sales and production cost targets, because the Company was operating at a pre-commercial scale until it ceased mining operations in November 2021, it has incurred a net operating loss with negative cash flows before financing activities. Refer to the Liquidity and Capital Resources section of this MD&A for additional details.
+Health and Safety
+We believe that safety is a core value and we support that belief through our philosophy of safe work performance. Our mandatory mine safety and health programs include employee engagement and ownership of safety performance, accountability, employee and contractor training, risk management, workplace inspection, emergency response, accident investigation, and program auditing. This integrated approach is essential to ensure that our employees, contractors, and visitors operate safely.
+During the first three months of 2022, we reported no lost time accidents. The Hycroft Mine s total recordable injury frequency rate ( TRIFR ) for the trailing twelve months, which includes other reportable incidents, is one of the metrics we use to assess safety performance, and it is well below industry averages and significantly below historical levels experienced at the Hycroft Mine. During the first three months of 2022 we continued our critical focus on safety, including allocating additional personnel, resources, workforce time, and communications to mine safety. These actions contributed to a reduction in our TRIFR to approximately 0.29 at March 31, 2022, compared with approximately 0.64 at December 31, 2021, an approximate 54% reduction. We will continue our safety efforts to reach the level of safety we expect and need to keep our workforce, contractors, and visitors safe.
+For health and safety actions specific to COVID-19, refer to the Recent Developments COVID-19 section of this MD&A.
+Executive Summary
+During the first three months ended March 31, 2022, we continued producing gold and silver from ore on the leach pads and expect to continue as long as it remains economic. When the operation was re-started in 2019, mining oxide and transition ore allowed us to pre-strip overburden with some revenue offset to gain access to commercial scale sulfide mineralization. With the change in focus from the Novel Process to a milling operation, there is ample time to align the remaining pre-stripping with the start-up of commercial scale sulfide operations. We believe that this action will conserve cash and focus our time and resources on its technical studies for sulfide ore. The metallurgical and variability drill program concluded in the first quarter of 2022, and metallurgical analysis and test work is expected to continue through the third quarter of 2022.
+During the year ended December 31, 2021, we operated a conventional ROM heap leach operation at pre-commercial scale using a mix of the Hycroft-owned mining fleet and a rental mining fleet until ceasing mining operations in November 2021 due to cost pressures for many of the reagents and consumables used at the Hycroft Mine, and the timeline for completing our updated technical studies in early 2022. We will continue to produce gold and silver from ore on the leach pads as long as it is economic. When the operation was re-started in 2019, mining oxide and transition ore allowed us to pre-strip overburden with some revenue offset to gain access to commercial scale sulfide mineralization. With the change in focus from the two-stage heap oxidation and leach to a milling operation, there is ample time to align the remaining pre-stripping with the start-up of commercial scale sulfide operations. We believe that this action will conserve cash and focus our time and resources on our technical studies for sulfide ore. The metallurgical and variability drill program concluded in the first quarter of 2022 and metallurgical analysis and test work is expected to continue through the third quarter of 2022.
+We had previously discussed our strategy for developing an economic sulfide process for Hycroft. Based on our findings to-date, including the analysis completed by an independent third-party research laboratory and the independent reviews by two metallurgical consultants, we do not believe the novel two-stage sulfide heap oxidation and leach process ( Novel Process ), as currently designed in the 2019 Hycroft TRS, is economic at current metal prices or those metal prices used in the 2019 Hycroft TRS. Subject to the 
+
+-59-
+
+Table of Contents
+
+challenges discussed below, we will complete test work that is currently underway and may advance our understanding of the Novel Process in the future.
+Following a review of past and recent test work and based on the currently contemplated designs and operating parameters of the alternative sulfide processing methods being studied including the Novel Process, and milling with atmospheric alkaline oxidation or alkaline pressure oxidation ( POX ), working closely with our industry leading technical consultants, we completed pit optimization runs and trade-off analyses comparing the alternative processes which reflected that an Acid POX process had significantly better economics than other processes studied. Therefore, we focused our study efforts and resources solely on the Acid POX Initial Assessment which was prepared by Ausenco, with an effective date of February 18, 2022. The Acid POX process included in the 2022 Hycroft TRS is a conventional crushing, grinding, and flotation circuit that generates a concentrate to be fed to an autoclave facility commonly used for refractory gold ores in this region.
+2022 Highlights
+ 
+Safety - Our safety performance continued to improve with a 0.29 trailing 12-month TRIFR at the end of the first quarter of 2022. This represented an approximate 54% reduction in TRIFR compared with 0.64 at the end of 2021.
+
+ 
+Production - Gold production for the three months ended March 31, 2022, was 5,358 ounces and silver production was 16,861 ounces, both in line with forecast. Processing of ore on leach pads is currently planned to proceed through the second quarter of 2022.
+
+ Strengthened balance sheet:
+ 
+Raised gross cash proceeds of $194.4 million through a $55.9 million private placement offering and $138.6 million in the ATM Program, before deductions of commissions, fees and expenses.
+
+ 
+Amended the Sprott Credit Agreement such that no further scheduled payments of principal are required prior to maturity, which was extended by two years to May 31, 2027, after raising the $50.0 million minimum equity and paying a $3.3 million fee in-kind. In addition, we made a prepayment of $23.9 million as required under the Second A&R Agreement.
+
+ 
+Amended the Assumed New Subordinated Notes to extend debt maturity by two years to December 1, 2027 with continuing 10% interest payable in-kind.
+
+ 
+Ended the first quarter of 2022 with $172.8 million of cash on hand and was in compliance with debt covenants.
+
+ 
+Finalized Initial Assessment Technical Report We, along with our third-party consultants, completed and filed the 2022 Hycroft TRS with an effective date of February 18, 2022. As of March 31, 2022, the Hycroft Mine had measured and indicated mineral resources of 9.6 million ounces of gold and 446.0 million ounces of silver and inferred mineral resources of 5.0 million ounces of gold and 150.4 million ounces of silver, which are contained in oxide, transitional and sulfide ores.
+
+Project Update
+ Drill Results - Results from our 2021 drill program continue to be delayed due to backlogs in the independent labs associated with reduced staffing levels from the Covid-19 pandemic and high demand for these services. To date, we have received results for approximately 30% of the drill samples. Additional results on the remaining samples are anticipated to be received over the course of the next two quarters, assuming no further delays. 
+ Potential under-estimation of silver in the resource model - Following our review of the resource in 2021, we announced on February 22, 2022, that silver may be under-estimated in the resource model noting that a significant portion of historical drilling in the database does not include assay information for silver. With silver currently estimated to contribute 40-50% of the potential value at the Hycroft Mine under the milling process, we believe this information is an important factor to the overall understanding of the resource. This represents a significant potential opportunity at Hycroft. We 
+
+-60-
+
+Table of Contents
+
+have located a portion of the historical pulps and have sent them to an independent lab to re-analyze for the missing silver values. It may become necessary to conduct additional drilling to gather samples for the other areas of missing silver values as it could yield a significant opportunity for additional economic benefit. 
+ Exploration - We have initiated work to conduct a robust exploration program during 2022 to follow up on the significant intercepts previously disclosed in our press releases of September 8, 2021 and February 22, 2022. There has been no exploration drilling at Hycroft since 2014 and no prior focus on understanding the potential feeder to the resource.
+2021 Development Highlights
+ Drill Results - During the 2021 drill program Hycroft encountered positive assay results further supporting the strategy to enhance the deposit through exploration drilling:
+ Higher-grade intercepts from the 2021 drill program returned approximately 102 intercepts (1.5-meter intervals) averaging 4.1 grams per metric ton ( g/t ) or 0.13 ounces per ton ( opt ) gold and 85.3 g/t (2.73 opt) silver.
+ Recent near-surface, higher-grade material was encountered in the Porter area of the deposit with intervals including 3 meters grading 9.13 g/t (0.29 opt) gold and 32.55 g/t (1.04 opt) silver within a larger interval of 19.8 meters grading 1.78 g/t (0.06 opt) gold and 12.85 g/t (0.41 opt) silver (H21C-5568) and 12.2 meters grading 0.68 g/t (0.02 opt) gold and 12.78 g/t (0.41 opt) silver (H21C-5552).
+ Exploration drilling in the Vortex Zone identified gold grades that are up to five times higher than the average Mineral Resource grades at Hycroft of 0.34 g/t (0.011 opt). Significant intercepts previously reported from that drilling included 51.8 meters (170 feet) grading 2.47 g/t (0.08 opt) gold and 25.5 g/t (0.82 opt) silver (H21R-5592) and an additional intercept of 30.5 meters (100 feet) grading 0.71 g/t (0.02 opt) gold and 17.5 g/t (0.56 opt) silver in drill hole H21R-5591.
+ Variability Program - The drilling portion of the program concluded in January 2022. We completed 12,985 meters of drilling in 62 holes. This generated 92 samples and two bulk samples for variability testing and enhancing information in the metallurgical database. Backlogs in the independent labs due reduced staffing levels associated with the COVID-19 pandemic combined with delayed drilling have adversely impacted the assays and variability work schedule.
+Recent Developments
+COVID-19
+In March 2020, the World Health Organization declared the outbreak of COVID-19 as a pandemic, which continues to spread throughout the United States with new variants of the virus. Efforts implemented by local and national governments, as well as businesses, including temporary closures, have had adverse impacts on local, national and global economies. We have implemented health and safety policies and protocols for employees, contractors, and visitors that follow guidelines published by the Center for Disease Control ( CDC ) and Mine Safety and Health Administration ( MSHA ). During 2021, and the fourth quarter of 2020, our operations were limited by COVID-19 related absences, however the impact while negative, did not materially and adversely affect our operations. The extent of the impact of COVID-19 on our operational and financial performance going forward will depend on certain developments, including but not limited to the duration and continued spread of the outbreak and strand mutations, the availability and use of vaccines, the development of therapeutic drugs and treatments, and the direct and indirect impacts on our employees, vendors, and customers, all of which are uncertain and cannot be fully anticipated or predicted. Since the Hycroft Mine represents the entirety of our operations, any further COVID-19 outbreaks at the mine site or any governmental restrictions implemented to combat the pandemic could result in a partial or an entire shutdown of the Hycroft Mine itself, which would adversely impact our financial position, operating results, and cash flows.
+During the year ended December 31, 2021, the site continued to manage COVID-19 control restrictions in accordance with state, national, and CDC guidelines. We have implemented health and safety policies for employees, contractors, and visitors that follow the guidelines published by the CDC and the MSHA. During the three months ended March 31, 2022, our operations faced certain limitations due to COVID-19, however the impact, while negative, did not materially adversely impact our operations.
+
+-61-
+
+Table of Contents
+
+Mineral Resource Update
+Gold equivalent mineral resources totaled 15.5 million ounces of measured and indicated and 6.9 million ounces of inferred. For this study, IMC developed the Hycroft Mine resource block model which includes data from 1981 to 2018 and includes 5,501 holes, representing 2,482,722 ft of drilling. The current inflationary environment and change in processing technique has resulted in increased cost assumptions and an associated higher cut-off grade partially mitigated by higher recoveries leading to a change in the mineral resource estimate, when compared with the prior model.
+The mineral resources were estimated based upon results of the 2022 Hycroft TRS, as conducted in accordance with the Modernization Rules. With the issuance of the 2022 Hycroft TRS reflecting a different mining process, the 2019 Hycroft TRS is superseded and the 2019 Hycroft TRS and information from such 2019 Hycroft TRS should no longer be relied upon.
+2022 Private Placement
+On March 14, 2022, the Company entered into the 2022 Private Placement pursuant to the execution of Subscription Agreements with each of AMC and Eric Sprott, pursuant to which the Company agreed to sell to them, in a private placement, an aggregate of 46,816,480 Units at a purchase price per Unit of $1.193 providing for a total purchase price of approximately $55.9 million before deducting expenses incurred in connection with the 2022 Private Placement. The New Warrants issued in the 2022 Private Placement have an exercise price of $1.068 per Warrant Share, and will expire five years after issuance. The closing of the sales of Units pursuant to the Subscription Agreements occurred on March 15, 2022 for gross proceeds to the Company of approximately $55.9 million. (before deduction of fees and expenses). We intend to use the proceeds for general corporate purposes, which may include the repayment, refinancing, redemption or repurchase of existing indebtedness, working capital or capital expenditures and other investments, which may include additional technical evaluations and studies, advancement of the Initial Assessment in the 2022 Hycroft TRS to a pre-feasibility and/or feasibility study and additional exploration at the Hycroft Mine.
+The Subscription Agreement with AMC, as amended, also provided AMC with the right to appoint a director to the Company s board of directors (the Board ) and the Company agreed to support such director s nomination so long as AMC retains at least 50% of the Common Stock purchased under the Subscription Agreement with AMC and holds at least 5% of the outstanding voting securities.
+As required by the Subscription Agreements, the Company prepared and filed this resale registration statement, of which this prospectus forms a part, with the SEC to register the Common Stock, Warrants and Warrant Shares for sale under the Securities Act.
+Agreement with Sprott Private Resource Lending II (Collector), LP
+On November 10, 2021, the Company entered into the November 2021 Waiver with the Lender of certain provisions of the Sprott Credit Agreement. Pursuant to the November 2021 Waiver, the Lender permitted the Company to cease active mining operations and to reduce the amount of unrestricted cash required to be maintained by the Company from not less than $10.0 million to not less than $9.0 million for the period ending May 10, 2022.
+On February 28, 2022 the Company entered into the February 2022 Waiver and Amendment with the Lender and Sprott Private Resource Lending II (Co) Inc. amending the November 2021 Waiver and (i) required that the Company maintain at least $7.5 million of unrestricted cash on the last day of February 2022 and at least $9.0 million on the last day of each month thereafter during the waiver period, (ii) waived all obligations of the Company to prepay the facility with the net cash proceeds of any mill asset sales until the earlier of the date on which the Company completes a private placement or other offering or issuance of its equity securities and March 31, 2022, and (iii) extended the payment due date for the February additional interest payment and the February principal payment until the earlier of any such offering date and March 31, 2022.
+On the basis of the Company s contemplated sale or issuance of its equity securities pursuant to one or more transactions to be completed on or before March 31, 2022 (the Equity Financing Transactions ), on March 11, 2022, the Company entered into the March 2022 Sprott Agreement with the Lender with respect to the Sprott Credit Agreement. Pursuant to the March 2022 Sprott Agreement, if the Equity Financing Transactions result (or are likely to result pursuant to definitive subscription underwriting and/or similar legally binding agreements) in the Company s receipt of total gross cash proceeds (before deduction of fees and expenses) of at least $50 million on or before March 31, 2022 (the Required Equity Amount ), the Lender and the Company were obligated to 
+
+-62-
+
+Table of Contents
+
+amend the principal repayment terms under the Sprott Credit Agreement such that no further scheduled payments of principal shall be required prior to May 31, 2025 (the Maturity Date ) (i.e., there will be no required regular amortization payments of the Facility (as defined in the Sprott Credit Agreement) and the full principal balance of the facility shall be due and payable in a single bullet payment on the Maturity Date). The consummation of the 2022 Private Placement satisfied the Required Equity Amount condition in the March 2022 Sprott Agreement.
+The March 2022 Sprott Agreement also provided that, in connection with the modification of the required facility amortization payments, the Company shall pay in-kind to the Lender an amount equal to $3.3 million, with such amount to be capitalized and added to the principal amount owing under the Sprott Credit Agreement and accrue interest at the same rate and upon the same terms as the existing loans under the Sprott Credit Agreement; provided, the payment or prepayment of such capitalized principal amount shall not be subject to the Prepayment Premium (as defined in the Sprott Credit Agreement) or any other penalty or premium.
+Second Amendment and Restatement of Sprott Credit Agreement
+On March 14, 2022, the Company reached an agreement in principle with the Lender to modify the terms of the Sprott Credit Agreement and other applicable loan documents. On March 30, 2022, the Company and Lender under the Sprott Credit Agreement entered into the Second A&R Agreement, which:
+(a)
+extended the maturity date for all of the loans and other principal obligations under the Sprott Credit Facility (as such term is defined in the Second A&R Agreement) by two years, to May 31, 2027;
+
+(b)
+provided for the Company to prepay principal under the Sprott Credit Facility in the amount of $10.0 million promptly upon the Company s receipt of cash proceeds from the 2022 Private Placement offering with AMC and Eric Sprott (the Initial Equity Proceeds Prepayment );
+
+(c)
+provided for the Company to prepay principal under the Second A&R Agreement in the amount of $13.9 million (representing 10% of the subsequent issuance of its equity interests consummated on or prior to March 31, 2022) (the Subsequent Equity Proceeds Prepayments ); and
+
+(d)
+eliminated the prepayment premiums otherwise payable with respect to the Initial Equity Proceeds Prepayment, the Subsequent Equity Proceeds Prepayments and all future prepayments of principal under the Sprott Credit Facility.
+
+In addition, the Company s obligations (i) to prepay principal with proceeds of asset sales will be credited/offset by the $23.9 million aggregate amount of Initial Equity Proceeds Prepayment and the Subsequent Equity Proceeds Prepayments, and (ii) to maintain a minimum amount of Unrestricted Cash (as defined in the Second A&R Agreement) was increased to $15.0 million. Pursuant to the agreement in principle, the Company made the Initial Equity Proceeds Prepayment of $10.0 million and paid in kind a $3.3 million fee in connection with the modification and capitalized it to principal on March 16, 2022 and following the execution of the Second A&R Agreement on March 30, 2022, the Company (i) paid the previously deferred additional interest payment of $0.5 million, and (ii) made the Subsequent Equity Proceeds Prepayment of $13.9 million. After giving effect to such prepayments the outstanding principal balance under the Second A&R Agreement was $57.9 million as of March 31, 2022 (before issuance discounts) including unpaid additional interest of approximately $7.1 million.
+At-the-market Offering of Common Stock
+On March 15, 2022, the Company implemented an ATM Program by entering into the Sales Agreement with B. Riley Securities, Inc. as the Agent. Under the terms of the Sales Agreement, the Company had the right from time to time to or through the Agent, acting as sales agent or principal, offer and sell shares of the Company s common stock having a gross sales price of up to $500 million. The compensation payable to the Agent for sales of shares pursuant to the Sales Agreement was equal to 3.0% of the gross sales price for any shares of common stock sold through the ATM Program by Agent as sales agent under the Sales Agreement. Shares sold under the Sales Agreement, were issued pursuant to the Company s shelf registration statement on Form S-3 (No. 333-257567) that the SEC declared effective on July 13, 2021, including the prospectus, dated July 13, 2021, and the prospectus supplement, dated March 15, 2022.
+
+-63-
+
+Table of Contents
+
+On March 25, 2022, the Company announced that it had terminated the ATM Program having sold 89,553,602 shares of common stock and generated aggregate gross proceeds, before commissions and offering expenses, of approximately $138.6 million.
+Amendment to the 10% Senior Secured Notes and Note Exchange Agreement
+On March 14, 2022, the Company entered into the Note Amendment with (i) certain direct and indirect subsidiaries of the Company as Guarantors; (ii) holders of the Assumed New Subordinated Notes, including certain funds affiliated with, or managed by, Mudrick Capital Management, L.P, Whitebox Advisors, LLC, Highbridge Capital Management, LLC, Aristeia Capital, LLC and Wolverine Asset Management, LLC (collectively, the Amending Holders ), and (iii) Wilmington Trust, National Association, in its capacity as collateral agent. The Note Amendment amended the Note Exchange Agreement and the Assumed New Subordinated Notes issued thereunder in order to extend the maturity date of the Assumed New Subordinated Notes from December 1, 2025 to December 1, 2027. The Note Amendment also removed the requirements that a holder receive the consent of the Company and the other holders in order to transfer any Assumed New Subordinated Note. The Amending Holders constituted all of the holders of the Assumed New Subordinated Notes. The Note Amendment became effective upon the closing of the 2022 Private Placement upon receipt of $55.9 million gross cash proceeds (before deduction of fees and expenses).
+Amendment to the Company s Second Amended and Restated Certificate of Incorporation
+On March 11, 2022, the Board approved an amendment to the Company s Second Amended and Restated Certificate of Incorporation increasing the number of authorized shares of the Common Stock by 1,000,000,000 to a total of 1,400,000,000 (the Certificate of Incorporation Amendment ) and directed that the Certificate of Incorporation Amendment be submitted for consideration by the stockholders of the Corporation. On March 15, 2022, AMC, Eric Sprott, and entities affiliated with Mudrick Capital, who together constituted the holders of a majority of the Common Stock, approved the Certificate of Incorporation Amendment by written consent. The Company commenced mailing to the stockholders of the Information Statement on Schedule 14C on April 1, 2022 and the Certificate of Incorporation Amendment became effective upon filing with the Secretary of State of Delaware on April 22, 2022.
+2022 Outlook
+Our current operating plan is to: (i) operate safely as we continue to process heap leach inventory until it is no longer economic; (ii) complete the metallurgical test work associated with the variability drilling program; (iii) conduct exploration activities and targeted exploration drilling; and (iv) continue to advance the Acid POX technical study to a pre-feasibility or feasibility level.
+Technical Activities
+During the first quarter of 2022, we continued to work alongside our industry-leading consultants to provide additional and expanded information on the ore body and investigate opportunities for improvements in operating parameters for commercial scale operations at the Hycroft Mine. This information is critical in understanding the mineralogical properties of the deposit and ultimately the most economic processing technology for the various ore domains. Accordingly, we developed an approximate $10 million program for drilling and additional metallurgical and mineralogical studies in 2021 and 2022. The drilling program was completed in January 2022, and the metallurgical test work portion of the program is expected to be completed in the early third quarter of 2022. Lab testing continues to be challenged by labor shortages and equipment availability. As of March 31, 2022, we have spent $8.0 million under the program.
+Ongoing and future technical work for the Hycroft Mine will be primarily focused on the Acid POX milling for processing sulfide ore and completing the variability and metallurgical test work. We also plan to evaluate exploration opportunities targeting higher ore grades and expect to continue to advance the Novel Process as time and resources permit.
+ Exploration We have identified exploration drilling opportunities to follow up on higher grade areas that would benefit from expanded drilling in order to convert inferred blocks to measured or indicated blocks, and areas that are prospective for higher grade material. We currently have plans to opportunistically and cost effectively drill these areas as we have drilling capacity with the drill rigs that were contracted to complete the variability drilling program.
+
+-64-
+
+Table of Contents
+
+ Mill sulfide processing options While our technical team continued to progress and develop an understanding of the requirements for implementing the Novel Process on a commercial scale, we received a completed peer reviewed report in the fourth quarter of 2021 from one of our independent technical consultants stating that, for reasons outlined below as well as increased commodity costs, it did not appear that the proprietary two-stage oxidation and leaching process as detailed in the 2019 Hycroft TRS, will be economic as designed at current metal prices or those metal prices used in the 2019 Hycroft TRS. Based on scoping level economic analyses on multiple processing options completed by our technical team, together with independent engineering firms and consultants and on the currently contemplated designs and operating parameters of the alternative sulfide milling processes being studied, we completed pit optimization runs comparing the alternative processes. The comparative analysis indicated that using an Acid POX process should be significantly more economic than the alternatives. Therefore, we used the test results and documented recoveries from the Acid POX process in the financial determination of the mineral resource. These are documented in the 2022 Hycroft TRS.
+ Two-stage sulfide heap oxidation and leach process As a result of challenges to consistently achieve targeted oxidation and recoveries from the Novel Process, our new technical and operating team, together with our industry leading metallurgical consultants, initiated detailed reviews of the technical information and prior work. We also had fresh samples of material from our Brimstone deposit metallurgically tested and launched a $10.0 million expanded variability drilling and metallurgical test program in late the first quarter of 2021. While the variability metallurgical test work is ongoing, the information to date supports our view that milling is likely the preferred method of processing sulfide ores at the Hycroft Mine. Additionally, while the chemistry of the two-stage sulfide oxidation and leach process has been confirmed, the commercial scale application of the process as currently understood will be economically challenged due to:
+o
+Higher operating costs - In the field work on the pre-commercial test pads, higher levels of soda ash were being applied to oxidize the transitional ore, and inconsistencies in achieving the targeted oxidation levels across the ore body. The test work has confirmed soda ash consumption is significantly higher than what was estimated in the 2019 Hycroft TRS. Moreover, the cost of soda ash and other reagents has increased substantially since 2019, which will negatively impact operating costs;
+
+o
+Higher capital costs - We identified a number of critical areas that had not been previously addressed in the 2019 Hycroft TRS. These included (1) the logistical placement of large volumes of new ROM material at the same time there is removal of material for preparation of the second stage; (2) the implementation of on/off pads to avoid comingling solutions on the leach pads; (3) addition of a material handling system; (4) an additional amalgamation circuit; and (5) an additional forced air injection pumping system. As a result, the necessary capital costs were expected to be materially higher than previously reported. Additionally, working capital was projected to be higher due to slower oxidation rates for some ores;
+
+o
+Lower recoveries on some ores - After reviewing all the column tests and considering additional factors in measuring oxidation and recovery rates, we were not able to consistently replicate a strong correlation between oxidation rates and gold recoveries. We believe that more test work is required before implementing this process in a commercial setting; and
+
+o
+Finer crush size will be required - After reviewing all the column tests and considering additional factors in measuring oxidation and recovery rates, we were not able to consistently replicate a strong correlation between oxidation rates and gold recoveries. We believe that more test work is required before implementing this process in a commercial setting.
+
+We currently believe that more test and development work is required to demonstrate that the Novel Process can be applied successfully on a commercial scale and the analysis to date indicates the process may not be amenable to all ore domains at the Hycroft Mine. For the near term, we currently plan to complete the following test work which is important and will benefit all processing methods for the Hycroft Mine:
+ 
+Column test work - Column tests are being performed on sulfide ores mined during the year ended December 31, 2021. These column tests will provide additional information for the Novel Process.
+
+-65-
+
+Table of Contents
+
+ 
+Variability test work - The variability test work that is underway is necessary for all commercial scale sulfide processing options. The test work includes a suite of laboratory tests designed to:
+
+ 
+understand the metallurgical characteristics of each geologic domain and their amenability to various processing technologies;
+
+ 
+understand the metallurgical characteristics of sulfide material below the water table;
+
+ 
+understand the role other minerals may play in the overall oxidation process;
+
+ 
+determine amenability to oxidation in each geologic domain; and
+
+ 
+establish a relationship between oxidation levels and gold recoveries across each geologic domain.
+
+ 
+
+-66-
+
+Table of Contents
+
+Hycroft Mine
+Three months ended March 31, 2022, compared to three months ended March 31, 2021.
+Operations
+The following table provides a summary of operating results for the Hycroft Mine:
+
+ 
+
+ 
+
+ 
+ 
+ 
+ 
+Three Months Ended March 31,
+ 
+
+ 
+ 
+ 
+ 
+2022
+ 
+2021
+ 
+
+Ore mined - sulfide stockpile
+(ktons)
+ 
+ 
+ 
+ 
+419
+ 
+
+Ore mined - crusher feed
+ 
+(ktons)
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Ore mined - ROM
+ 
+(ktons)
+ 
+ 
+ 
+ 
+ 
+2,466
+ 
+
+Total ore mined
+ 
+(ktons)
+ 
+ 
+ 
+ 
+ 
+2,885
+ 
+
+Waste mined
+ 
+(ktons)
+ 
+ 
+ 
+ 
+ 
+1,195
+ 
+
+Total mined
+ 
+(ktons)
+ 
+$
+ 
+ 
+ 
+4,080
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Waste tons to ore tons strip ratio
+ 
+(#)
+ 
+ 
+ 
+ 
+ 
+0.41
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Ore grade mined - gold
+ 
+(oz/ton)
+ 
+ 
+ 
+ 
+ 
+0.013
+ 
+
+Ore grade mined - silver
+ 
+(oz/ton)
+ 
+ 
+ 
+ 
+ 
+0.258
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Production - gold
+ 
+(oz)
+ 
+ 
+5,358
+ 
+ 
+13,858
+ 
+
+Production - silver
+ 
+(oz)
+ 
+ 
+16,861
+ 
+ 
+94,845
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Ounces sold - gold
+ 
+(oz)
+ 
+ 
+4,773
+ 
+ 
+9,830
+ 
+
+Ounces sold - silver
+ 
+(oz)
+ 
+ 
+10,934
+ 
+ 
+57,236
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Average realized sales price - gold
+ 
+($/oz)
+ 
+$
+1,866
+ 
+$
+1,784
+ 
+
+Average realized sales price - silver
+ 
+($/oz)
+ 
+$
+23.78
+ 
+$
+26.12
+ 
+
+ 
+As shown above, tons mined, ounces produced and ounces sold decreased during the three months ended March 31, 2022, compared with the same period of the prior year. These decreases reflect the decision to cease mining operations in November 2021. We expect to continue to process gold and silver ore on leach pads until such time that it is no longer economic to do so and as a result, due to the increases in the spot prices for gold during the first quarter of 2022, the average realized prices increased during the three months ended March 31, 2022.
+ 
+
+-67-
+
+Table of Contents
+
+Fiscal year ended December 31, 2021, compared to fiscal year ended December 31, 2020.
+ 
+Operations
+ 
+The following table provides a summary of operating results for the Hycroft Mine:
+ 
+ 
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ 
+Year Ended December 31,
+
+ 
+ 
+ 
+ 
+2021
+ 
+2020
+
+Ore mined - sulfide stockpile
+ 
+(Ktons)
+ 
+ 
+ 1,505
+ 
+ 
+ 
+
+Ore mined - crusher feed
+ 
+(Ktons)
+ 
+ 
+ 
+ 
+ 
+ 4,941
+
+Ore mined - ROM
+ 
+(Ktons)
+ 
+ 
+ 6,853
+ 
+ 
+ 1,873
+
+Total ore mined
+ 
+(Ktons)
+ 
+ 
+ 8,358
+ 
+ 
+ 6,814
+
+Waste mined
+ 
+(Ktons)
+ 
+ 
+ 4,934
+ 
+ 
+ 4,815
+
+Total mined
+ 
+(Ktons)
+ 
+ 
+ 13,292
+ 
+ 
+ 11,629
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Waste tons to ore tons strip ratio
+ 
+(#)
+ 
+ 
+ 0.59
+ 
+ 
+ 0.71
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Ore grade mined - gold
+ 
+(oz/ton)
+ 
+ 
+ 0.014
+ 
+ 
+ 0.014
+
+Ore grade mined - silver
+ 
+(oz/ton)
+ 
+ 
+ 0.425
+ 
+ 
+ 0.261
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Production - gold
+ 
+(oz)
+ 
+ 
+ 57,668
+ 
+ 
+ 27,392
+
+Production - silver
+ 
+(oz)
+ 
+ 
+ 355,967
+ 
+ 
+ 178,836
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Ounces sold - gold
+ 
+(oz)
+ 
+ 
+ 56,045
+ 
+ 
+ 24,892
+
+Ounces sold - silver
+ 
+(oz)
+ 
+ 
+ 397,546
+ 
+ 
+ 136,238
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Average realized sales price - gold
+ 
+($/oz)
+ 
+$
+ 1,794
+ 
+$
+ 1,779
+
+Average realized sales price - silver
+ 
+($/oz)
+ 
+$
+ 25.66
+ 
+$
+ 20.30
+
+ 
+As reflected above, tons mined, ounces produced, ounces sold and average realized prices increased during the year ended December 31, 2021, compared with the same period of the prior year due to higher tons mined in 2021. The average price increased during the year ended December 31, 2021 consistent with the increase in the spot price of gold compared with the same period of the prior year. As planned for 2021, all mined ore was routed to the leach pad as ROM and sulfide ore encountered was stockpiled. Due to the ROM plan for 2021, the crusher did not operate during the year.
+Production and sales for the year ended 2021 increased over the comparable 2020 period due to increased quantities of ROM ounces placed during 2021. The gold and silver ounces produced in the year ended December 31, 2021 resulted from continued leach production of inventory ounces added to the leach pad in 2020, additional ounces placed under leach from mining in 2021, higher leach solution flows to the pad, and improved flows and recovery performance from the Brimstone plant.
+
+-68-
+
+Table of Contents
+
+Results of Operations
+Three months ended March 31, 2022, compared to three months ended March 31, 2021.
+Revenues
+Gold revenue
+The table below summarizes gold sales, ounces sold and average realized prices for the following periods (dollars in thousands, except per ounce amounts):
+
+ 
+
+ 
+
+ 
+ 
+Three Months Ended March 31,
+ 
+
+ 
+ 
+2022
+ 
+2021
+ 
+
+Gold revenue
+ 
+$
+8,906
+ 
+$
+17,541
+ 
+
+Gold ounces sold
+ 
+ 
+4,773
+ 
+ 
+9,830
+ 
+
+Average realized price (per ounce)
+ 
+$
+1,866
+ 
+$
+1,784
+ 
+
+ 
+During the three months ended March 31, 2022, gold revenue was $8.9 million, compared to $17.5 million for the comparable period of 2021. The significant decrease in revenue during the 2022 period was attributable to the cessation of mining operations in November 2021. As a result, significantly less ore was under leach during the 2022 period as compared to the prior period of 2021. This decrease was partially offset by an increase in the average realized price which was due to higher spot prices for gold during the three months ended March 31, 2022.
+Silver revenue
+The table below summarizes silver sales, ounces sold and average realized prices for the following periods (dollars in thousands, except per ounce amounts):
+
+ 
+ 
+Three Months Ended March 31,
+ 
+
+ 
+ 
+2022
+ 
+2021
+ 
+
+Silver revenue
+ 
+$
+260
+ 
+$
+1,495
+ 
+
+Silver ounces sold
+ 
+ 
+10,934
+ 
+ 
+57,236
+ 
+
+Average realized price (per ounce)
+ 
+$
+23.78
+ 
+$
+26.12
+ 
+
+ 
+During the three months ended March 31, 2022, silver revenue was $0.3 million compared to $1.5 million for the comparable period of 2021. Similar to gold revenue, the decrease in silver revenue during the first quarter of 2022 was attributable to the cessation of mining activities in November 2021. 
+Total cost of sales
+Total cost of sales consists of Production costs, Depreciation and amortization, and Hycroft Mine site period costs. The table below summarizes total cost of sales for the following periods (dollars in thousands):
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+Three Months Ended
+ March 31,
+ 
+
+ 
+ 
+2022
+ 
+2021
+ 
+
+Production costs
+ 
+$
+9,583
+ 
+$
+17,817
+ 
+
+Depreciation and amortization
+ 
+ 
+920
+ 
+ 
+1,041
+ 
+
+Mine site period costs
+ 
+ 
+6,469
+ 
+ 
+10,544
+ 
+
+Total cost of sales
+ 
+$
+16,972
+ 
+$
+29,402
+ 
+
+ 
+
+-69-
+
+Table of Contents
+
+Production costs
+For the three months ended March 31, 2022, we recognized $9.6 million, in Production costs, or $2,008 per ounce of gold sold, compared to $17.8 million or $1,813 per ounce of gold, sold during the same period of 2021. The decrease in production costs was primarily due to a respective decrease in gold ounces sold of 5,057 ounces sold, partly offset by a higher average inventory cost per ounce during the three months ended March 31, 2022 compared to the same periods of 2021. 
+Depreciation and amortization
+Depreciation and amortization was $0.9 million or $193 per ounce of gold sold for the three months ended March 31, 2022, respectively, compared to $1.0 million or $106 per ounce of gold sold, during the same periods of 2021. The increase in total depreciation and amortization costs per ounce of gold sold was largely due to a decrease of 5,057 gold ounces sold during the three months ended March 31, 2022 compared to the same period of 2021. 
+Mine site period costs
+During the three months ended March 31, 2022, inclusive of depreciation and amortization, we recorded $6.5 million of cost of sales for costs that were in excess of the net realizable value per ounce of gold inventories, compared to $10.5 million during the same periods of 2021. Such period costs are generally the result of costs related to activities at the Hycroft Mine that do not qualify for capitalization to production-related inventories or adjustments to production inventories that are the result of recurring or significant downtime or delays, unusually high levels of repairs, inefficient operations, overuse of processing reagents, inefficient cost-volume structures, or other unusual costs and activities, and cannot be recorded to production-related inventories based on the threshold established by the calculation of the estimated net realizable value per ounce of gold. 
+General and administrative
+ General and administrative totaled $3.1 million during the three months ended March 31, 2022 compared to $3.8 million during the same period of 2021. The decrease of $0.7 million during the three months ended March 31, 2022 was primarily due to decreases in salary and compensation costs of $0.6 million due to reduced headcount and consulting fees associated with our former employees that ended during 2021 of $0.2 million. Such decreases were offset by an increase in insurance related costs of $0.1 million. 
+Projects, exploration and development
+During the three months ended March 31, 2022, Projects, exploration and development costs totaled $1.0 million compared to $0.5 million for the same period of 2021. Projects, exploration and development are related to: (i) completing technical studies; (ii) conducting geological studies; (iii) oversight and project management; and (iv) exploration drilling, engineering, and metallurgical activities. The increase of $0.5 million during the three months ended March 31, 2022 was the result of additional costs for the 2022 Hycroft TRS that was issued in February 2022 without established mineral reserves. 
+Interest expense, net of capitalized interest
+As discussed and detailed in Note 9 - Debt, Net to the Notes to the First Quarter Financial Statements, Interest expense, net of capitalized interest totaled $5.3 million during the three months ended March 31, 2022, compared to $4.4 million during the same period in 2021. The increase of $0.9 million during the three months ended March 31, 2022 was the result of a higher balance outstanding on the Assumed New Subordinated Notes at March 31, 2022 as compared to the same period in 2021. The higher outstanding balance for the Assumed New Subordinated Notes was due to quarterly interest payments that are paid in-kind as additional indebtedness. 
+Fair value adjustments to warrants
+During the three months ended March 31, 2022, the Fair value adjustments to warrants resulted in a non-cash loss of $5.3 million as the market trading values of the publicly-listed warrants increased.
+
+-70-
+
+Table of Contents
+
+During the three months ended March 31, 2021, the Fair value adjustments to warrants resulted in a non-cash gain of $9.5 million as the market trading values of the publicly-listed warrants decreased, which was primarily due to a decrease in the underlying trading price of the common stock.
+Refer to Note 11 - Warrant Liabilities to the Notes to the First Quarter Financial Statements for further detail.
+Income taxes
+There was no income tax benefit or expense, net, recognized during the three months ended March 31, 2022 and 2021. We have not recorded any future income tax benefits for net losses, due to a full valuation allowance recorded against the net operating loss carryforward. 
+Section 382 of the Internal Revenue Code ( IRC ) imposes limitations on the use of U.S. federal net operating losses ( NOLs ) upon a more than 50% change in ownership in the Company (as defined in the IRC) within a three-year period. In connection with the ATM Program, we underwent a Section 382 ownership change on March 25, 2022. As a result, utilization of the Company s NOL s and certain unrealized losses are limited on an annual basis. If the Section 382 annual limitation amount is not fully utilized in a particular tax year, then the unused portion from that tax year is added to the Section 382 annual limitation in subsequent years. The Company s annual limitation under Section 382 is estimated to be approximately $1.3 million.
+For additional details, refer to Note 16 - Income Taxes to the Notes to the First Quarter Financial Statements.
+Net loss
+For the reasons discussed above, we recorded a Net loss of $22.1 million for the three months ended March 31, 2022, which included a loss from Fair value adjustments to warrants of $5.3 million compared to net losses of $9.7 million for the three months ended March 31, 2021, which included a $9.5 million gain from Fair value adjustment to warrants.
+Fiscal year ended December 31, 2021, compared to fiscal year ended December 31, 2020.
+Revenues
+Gold revenue
+The table below summarizes gold sales, ounces sold and average realized prices for the following periods (dollars in thousands, except per ounce amounts):
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+Year Ended December 31,
+
+ 
+ 
+2021
+ 
+2020
+
+Gold revenue
+ 
+$
+ 100,532
+ 
+$
+ 44,279
+
+Gold ounces sold
+ 
+ 
+ 56,045
+ 
+ 
+ 24,892
+
+Average realized price (per ounce)
+ 
+$
+ 1,794
+ 
+$
+ 1,779
+
+ 
+During the year ended December 31, 2021, gold revenue was $100.5 million compared to $44.3 million for the comparable period of 2020. The significant increase in revenue during 2021 was attributable to the mine having more ore under leach as mining and processing operations increased beginning in the second quarter of 2020, resulting in higher production-related inventory balances and gold revenue during the year ended December 31, 2021. Gold revenue was also adversely affected during the year ended December 31, 2020 due to lower gold ounces available for sale as a result of write-downs of recoverable gold ounces on the leach pads. Refer to Note 4 - Inventories and Ore on Leach Pads to the 2021 Year End Notes for an explanation of the write-down.
+
+-71-
+
+Table of Contents
+
+Silver revenue
+The table below summarizes silver sales, ounces sold and average realized prices for the following periods (dollars in thousands, except per ounce amounts):
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+Year Ended December 31,
+
+ 
+ 
+2021
+ 
+2020
+
+Silver revenue
+ 
+$
+ 10,202
+ 
+$
+ 2,765
+
+Silver ounces sold
+ 
+ 
+ 397,546
+ 
+ 
+ 136,238
+
+Average realized price (per ounce)
+ 
+$
+ 25.66
+ 
+$
+ 20.30
+
+ 
+During the year ended December 31, 2021, silver revenue was $10.2 million compared to $2.8 million for the comparable period of 2020. Similar to gold revenue, the increase in silver revenue during 2021 was attributable to the mine having more ore under leach as compared to the same 2020 period. During the year ended December 31, 2021, we also benefited from favorable silver prices, which were more than $5 per ounce higher compared to the same period of 2020. Silver revenue was also adversely affected during the year ended December 31, 2020 due to lower silver ounces available for sale as a result of write-downs of recoverable ounces on the leach pads.
+Total cost of sales
+Total cost of sales consists of Production costs, Depreciation and amortization, Mine site period costs, and Write-down of inventories. The table below summarizes total cost of sales for the following periods (dollars in thousands):
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+Year Ended December 31,
+
+ 
+ 
+2021
+ 
+2020
+
+Production costs
+ 
+$
+ 102,750
+ 
+$
+ 41,688
+
+Depreciation and amortization
+ 
+ 
+ 8,544
+ 
+ 
+ 2,894
+
+Mine site period costs
+ 
+ 
+ 38,166
+ 
+ 
+ 47,115
+
+Write-down of inventories
+ 
+ 
+ 13,878
+ 
+ 
+ 17,924
+
+Total cost of sales
+ 
+$
+ 163,338
+ 
+$
+ 109,621
+
+ 
+Production costs
+For the year ended December 31, 2021, we recognized $102.8 million in Production costs, or $1,833 per ounce of gold sold, compared to $41.7 million or $1,675 per ounce of gold sold during the same period of 2020. The increase in Production costs was primarily due to a respective increase in the sales volumes of gold and silver of 31,153 and 261,308 ounces sold, respectively, at a higher average inventory cost per ounce during the year ended December 31, 2021 compared to the same period of 2020. As discussed in the below Mine site period costs section, throughout 2021 and 2020, a high operating cost structure at current levels of production has resulted in Mine site period costs to adjust ending inventory values of gold that approximate the net realizable value per ounce of gold (after considering future costs to complete and sell) as determined in accordance with our accounting policies. Accordingly, production costs per ounce of gold sold has been partially limited by the impact of recognizing Mine site period costs, which lowers the carrying value of production-related inventories. Reductions in the spot price of gold at the reporting periods as compared to prior reporting periods can result in additional Mine site period costs.
+Depreciation and amortization
+Depreciation and amortization was $8.5 million, or $152 per ounce of gold sold, for the year ended December 31, 2021 compared to $2.9 million, or $116 per ounce of gold sold, during the same periods of 2020. The increase in total depreciation and amortization costs per ounce of gold sold was largely due to an increase of 31,153 gold ounces sold during the year ended December 31, 2021 compared to the same period of 2020.
+
+-72-
+
+Table of Contents
+
+Mine site period costs
+During the year ended December 31, 2021, inclusive of depreciation and amortization, we recorded $38.2 million of Mine site period costs for costs that were in excess of the net realizable value per ounce of gold inventories, compared to $47.1 million during the same period of 2020. Such period costs are generally the result of costs related to activities at the Hycroft Mine that do not qualify for capitalization to production-related inventories or adjustments to production inventories that are the result of recurring or significant downtime or delays, unusually high levels of repairs, inefficient operations, overuse of processing reagents, inefficient cost-volume structures, or other unusual costs and activities, and cannot be recorded to production-related inventories based on the threshold established by the calculation of the estimated net realizable value per ounce of gold.
+Write-down of inventories
+We recorded a Write-down of inventories of $13.9 million for the year ended December 31, 2021 related to the following:
+ A write-down of the non-current portion of Ore on leach pads of $5.5 million for Production costs and $0.4 million of capitalized depreciation and amortization costs related to 3,612 ounces of gold contained in the over liner material on the new larger leach pad which we began constructing in 2020. As the 2022 Hycroft TRS does not include proven and probable mineral reserves, it was determined that the recoverability of these ounces is dependent upon additional work and technical studies and, as a result, it was determined that the ounces and related capitalized amounts should be written-off.
+ A write-down of Inventories of $5.9 million for obsolete and slow moving materials and supplies inventories. As a result of ceasing mining operations, it was determined that certain materials and supplies were not expected to be used in the next 12 months and, accordingly, a reserve was placed against these items.
+ A loss of $2.1 million related to a firm purchase commitment for crusher liners that we agreed to purchase under consignment over a period of three years beginning in August 2020. This loss relates to the unfulfilled commitment obligation and has been reduced to reflect our negotiated settlement with the supplier.
+
+As discussed in Note 4 - Inventories and Ore on Leach Pads to the 2021 Year End Notes, based on metallurgical balancing results, during the year ended December 31, 2020, we determined that 10,492 ounces of gold that had been placed on the leach pads were no longer recoverable and recognized $17.9 million of Write-down of inventories on the Consolidated Statements of Operations, which included production costs of $16.7 million, and capitalized depreciation and amortization costs of $1.2 million, respectively.
+General and administrative
+General and administrative totaled $14.6 million during the year ended December 31, 2021 compared to $21.1 million during the year ended December 31, 2020. The decrease of $6.4 million during the year ended December 31, 2021 was primarily due to decreases in: (i) salary and compensation costs of $6.2 million; (ii) insurance costs of $1.2 million; partially offset by increases in: (i) legal, professional, and consulting fees associated with general corporate matters and obligations as a public company of $0.4 million; and (ii) director compensation for the members of our committees created upon becoming a public company of $0.5 million.
+Projects, exploration and development
+During the year ended December 31, 2021, Projects, exploration and development costs totaled $13.6 million and were related to the following activities: (i) analyzing established feasibility studies; (ii) conducting geological studies; (iii) oversight and project management; and (iv) exploration drilling, engineering, and metallurgical activities. Upon determining that the 2019 Hycroft TRS was not likely to be economic, we determined that previously capitalized mine development costs related to the 2019 Hycroft TRS no longer qualified for capitalization. As a result we recorded an impairment charge of $6.7 million for the previously capitalized amounts that was included in Projects, exploration and development during the year ended December 31, 2021. We did not incur any such costs during the year ended December 31, 2020.
+ 
+
+-73-
+
+Table of Contents
+
+Write-off of deposit
+During the year ended December 31, 2021, we determined that additional equipment was no longer expected to be purchased under the current mine plan. Accordingly, a full reserve was applied against the $0.9 million deposit previously paid by us to an equipment supplier. Refer to Note 5 - Prepaids and Other, Net to the 2021 Year End Notes for further detail.
+Accretion
+We recorded $0.4 million of Accretion during both of the years ended December 31, 2021 and 2020, which related to our Asset retirement obligation and future reclamation costs. Refer to Note 13 - Asset Retirement Obligation to the 2021 Year End Notes for further detail.
+Interest expense, net of capitalized interest
+As discussed and detailed in Note 10 - Debt, Net to the Year End Notes, Interest expense, net of capitalized interest totaled $20.6 million during the year ended December 31, 2021 compared to $43.5 million during the same period in 2020. The decrease of $23.0 million during the year ended December 31, 2021 was a result of completing the Recapitalization Transaction on May 29, 2020, which caused the exchange or conversion of the majority of Seller s $627.8 million outstanding indebtedness to equity, thus resulting in post-Recapitalization Transaction indebtedness totaling $159.8 million for the Sprott Credit Agreement and Assumed New Subordinated Notes.
+Fair value adjustments to warrants
+During the year ended December 31, 2021, the Fair value adjustments to warrants resulted in a non-cash gain $14.4 million as the market trading values of our publicly listed warrants decreased, which was primarily due to a decrease in the underlying trading price of our common shares. We did not incur any such warrant adjustment during the year ended December 31, 2020. Refer to Note 12 - Warrants to the 2021 Year End Notes for further detail.
+Interest income
+Interest income totaled approximately $Nil during the year ended December 31, 2021 compared with $0.2 million during the year ended December 31, 2020. During the second quarter of 2021, we replaced certain surety bonds with new surety bonds with lower cash collateral requirements, in which none of the accounts holding the cash collateral earns interest income, resulting in no Interest income for the year ended December 31, 2021.
+Income taxes
+During the year ended December 31, 2021, we recognized an income tax benefit of $1.5 million which was the result of carrying back our net operating losses to periods that we paid income tax prior to the Recapitalization Transaction. There was no income tax benefit or expense, net, recognized during the year ended December 31, 2020. We have not recorded any future income tax benefits for net losses generated after the completion of the Recapitalization Transaction, due to a full valuation allowance recorded against our net operating loss carryforward earned after the Recapitalization Transaction. For additional details, refer to Note 17 - Income Taxes to the 2021 Year End Notes.
+Net loss
+For the reasons discussed above, we recorded a net loss of $88.6 million for the year ended December 31, 2021, respectively, which included a gain from Fair value adjustments to warrants of $14.4 million, compared to a net loss of $136.4 million for the year ended December 31, 2020.
+
+-74-
+
+Table of Contents
+
+Liquidity and Capital Resources
+Three months ended March 31, 2022, compared to three months ended March 31, 2021.
+ 
+General
+Our unrestricted cash position at March 31, 2022 was $172.8 million as compared with $12.3 million at December 31, 2021. While we plan to continue processing gold and silver ore on the leach pads after ceasing mining operations and partially offset the cash that is projected to be used in operations and investing activities, we do not expect to generate net positive cash for the foreseeable future. Accordingly, we will be dependent on our unrestricted cash and other sources of cash to fund the business. As discussed in Note 13 Stockholders Equity in the Notes to the First Quarter Financial Statements, we raised gross proceeds of approximately $194.4 million in March 2022, before deduction of commissions and expenses, through the following equity financings:
+ On March 14, 2022, we entered into the Subscription Agreements with AMC and Eric Sprott pursuant to which the Company sold on March 15, 2022 an aggregate of 46,816,480 units, each unit consisting of one share of Common Stock and one New Warrant to purchase one Warrant Share, at a purchase price of $1.193 per unit for total gross proceeds, before deduction of fees and expenses, of $55.9 million.
+ On March 15, 2022, we implemented the ATM Program. On March 25, 2022, we terminated the ATM Program and announced that we had sold 89,553,584 shares of Common Stock under the ATM Program and generated aggregate gross proceeds before commissions and offering expenses of approximately $138.6 million.
+In addition, we will continue to evaluate alternatives to raise additional capital necessary to fund the future development of the Hycroft Mine and will continue to explore other strategic initiatives to enhance stockholder value.
+Historically, we have been dependent on various forms of debt and equity financing to fund our business. While we have been successful in the past raising funds through equity and debt financings, no assurance can be given that additional financing will be available to us in amounts sufficient to meet our needs or on terms acceptable to us. In the event that funds are not available, we may be required to materially change our business plans. See Risk Factors -- Business Related Risks -- Business-Related Risks -- We will need to raise additional capital, but such capital may not be available on favorable terms or at all for a further discussion.
+To avoid potential non-compliance with the Sprott Credit Agreement, we obtained a series of waivers and entered into amendments to the Sprott Credit Agreement. Please see Debt Covenants below and Note 9 Debt, Net in the Notes to the First Quarter Financial Statements for information regarding additional waivers received and modifications to the Sprott Credit Agreement, including the Second A&R Agreement.
+Our future liquidity and capital resources management strategy entails a disciplined approach to monitor the timing and depth of any drilling, metallurgical and mineralogical studies and the continuation of processing the remaining leach pad inventory while attempting to remain in a position that allows us to respond to changes in the business environment, such as a decrease in metal prices or lower than forecasted future cash flows, and changes in other factors beyond our control. We have undertaken efforts aimed at managing our liquidity and preserving our capital resources by, among other things: (i) monitoring metal prices and the impacts (near-term and future) they have on the business and cash flows; (ii) ceasing open pit mining operations to reduce net cash outflows while continuing to process leach pad inventory until such time as it is no longer economic; (iii) reducing the size of the workforce to reflect the cessation of mining operations; (iv) controlling working capital and managing discretionary spending; (v) reviewing contractor usage and rental agreements for more economic options, including termination of certain agreements in accordance with their terms; (vi) decreasing restricted cash balances that collateralize bonds, as available; and (vii) planning the timing and amounts of capital expenditures and drilling, metallurgical and mineralogical study costs at the Hycroft Mine and deferring such items that are not expected to benefit our near term operating plans. We have undertaken and continue to undertake additional efforts to: (i) monetize non-core assets and excess materials and supplies inventories; (ii) return excess rental and leased equipment; (iii) sell certain uninstalled grinding mills that are not expected to be needed for a future milling operation; (iv) sell other uninstalled grinding mills if 
+
+-75-
+
+Table of Contents
+
+the proceeds contribute to enhancing a future milling operation; and (v) work with existing debt holders to adjust debt service requirements.
+Cash and liquidity
+We have placed substantially all of our cash in operating accounts with a well-capitalized financial institution, thereby ensuring balances remain readily available. Due to the nature of our operations and the composition of current assets, Cash and metal inventories represent substantially all of the liquid assets on hand. Additionally, the Company is provided with additional liquidity as ounces are recovered from the Ore on leach pads, processed into finished goods, and sold at prevailing spot prices to customers.
+The following table summarizes projected sources of future liquidity, as recorded within the First Quarter Financial Statements (dollars in thousands):
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+March 31, 2022
+ 
+December 31, 2021
+
+Cash
+ 
+$
+172,778
+ 
+$
+12,342
+
+Metal inventories(1)
+ 
+ 
+6,976
+ 
+ 
+6,693
+
+Ore on leach pads(2)
+ 
+ 
+3,680 
+ 
+ 
+10,106 
+
+Assets held-for-sale
+ 
+ 
+10,308 
+ 
+ 
+11,558 
+
+Total projected sources of future liquidity
+ 
+$
+ 193,742
+ 
+$
+ 40,699
+
+(1)
+Metal inventories contained approximately 3,869 recoverable ounces of gold that are expected to be sold within the next 12 months. Assuming a gold selling price of $1,942 per ounce (the March 31, 2022 P.M. fix) and excluding any proceeds from silver sales, the sale of all gold ounces estimated to be recovered from metal inventories would provide $7.5 million of revenue. See Note 3 - Inventories and Ore on Leach Pads to the Notes to the First Quarter Financial Statements for additional information.
+
+(2)
+Ore on leach pads contained approximately 2,693 ounces of gold that are expected to be processed into finished goods and then sold within the next 12 months. Assuming a gold selling price of $1,942 per ounce (the March 31, 2022 P.M. fix) and excluding any proceeds from silver sales, the sale of all gold ounces estimated to be recovered from ore on leach pads would provide $5.2 million of revenue. See Note 3 - Inventories and Ore on Leach Pads to the Notes to the First Quarter Financial Statements for additional information.
+
+Three months ended March 31, 2022 compared to the three months ended March 31, 2021
+The following table summarizes sources and uses of cash for the following periods (dollars in thousands):
+ 
+ 
+Three Months Ended
+March 31,
+
+ 
+ 
+2022
+ 
+2021
+
+Net loss
+ 
+$
+ (22,060)
+ 
+$
+ (9,688)
+
+Net non-cash adjustments
+ 
+ 
+9,954 
+ 
+ 
+(2,846)
+
+Net change in operating assets and liabilities
+ 
+ 
+5,190 
+ 
+ 
+(2,227)
+
+Net cash used in operating activities
+ 
+ 
+(6,916)
+ 
+ 
+(14,761)
+
+Net cash used in investing activities
+ 
+ 
+1,610 
+ 
+ 
+(5,082)
+
+Net cash (used in) provided by financing activities
+ 
+ 
+165,742 
+ 
+ 
+ 
+
+Net (decrease) increase in cash
+ 
+ 
+160,436 
+ 
+ 
+(19,843)
+
+Cash and restricted cash, beginning of period
+ 
+ 
+46,635 
+ 
+ 
+96,040 
+
+Cash and restricted cash, end of period
+ 
+$
+ 207,071
+ 
+$
+ 76,197
+
+ 
+
+-76-
+
+Table of Contents
+
+Cash used in operating activities
+During the three months ended March 31, 2022, we used $6.9 million of cash in operating activities primarily attributable to a net loss of $22.1 million, the cash impact of which was equal to $12.1 million, and $5.2 million was provided by working capital, which included a $6.1 million decrease for production-related inventories as we continue to process the remaining gold and silver ore on our leach pads which was partly offset by cash used to reduce Accounts payable of $2.8 million. The largest non-cash items included in net loss during the three months ended March 31, 2022 included a $5.3 million loss from Fair value adjustments to warrants and Non-cash portion of interest expense of $3.8 million.
+For the three months ended March 31, 2021, we used $14.8 million of cash in operating activities primarily attributable to a net loss of $9.7 million, the cash impact of which was $12.5 million, and $2.2 million was used for working capital, which included $4.0 million used to increase production-related inventories. The largest non-cash items included in net loss for the three months ended March 31, 2021 included a $9.5 million gain from Fair value adjustments to warrants and Non-cash portion of interest expense of $4.4 million.
+Cash provided by (used in) investing activities
+For the three months ended March 31, 2022, investing activities provided cash of $1.6 million primarily from the sale of a regrind mill, which was included in Assets held for sale, for gross proceeds of $1.3 million and other mobile mine equipment and materials and supplies for proceeds of $0.7 million. In addition, we purchased mobile mine equipment of $0.4 million.
+For the three months ended March 31, 2021, we used $5.1 million in investing activities which primarily related to expenditures of $2.5 million (exclusive of capitalized interest of $0.7 million) for the leach pad expansion project and $1.4 million for purchased equipment. We completed construction of the leach pad to the appropriate point at which we believe that there would be minimal risk of adverse impacts to the leach pad.
+Cash provided by financing activities
+During the three months ended March 31, 2022 cash provided by financing activities of $165.7 million was primarily related to the equity offerings completed during the period: (i) the Private Placement offering completed on March 15, 2022 for gross proceeds of $55.9 million, and (ii) the ATM Program completed on March 25, 2022 for net proceeds of $134.3 million. These amounts were offset by the required prepayments under the Second A&R Agreement of $24.4 million, including $0.5 million of additional interest.
+There were no cash financing activities during the three months ended March 31, 2021.
+Future capital and cash requirements
+The following table provides our gross contractual cash obligations as of March 31, 2022, which are grouped in the same manner as they were classified in the cash flows in order to provide a better understanding of the nature of the obligations and to provide a basis for comparison to historical information. We believe that the following provides the most meaningful presentation of near-term obligations expected to be satisfied using current and available sources of liquidity (dollars in thousands):
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+Payments Due by Period
+
+ 
+ 
+ 
+ 
+ 
+Less than 1
+ 
+1 3
+ 
+3 5
+ 
+More than 5
+
+ 
+ 
+Total
+ 
+Year
+ 
+Years
+ 
+Years
+ 
+Years
+
+Operating activities:
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Net smelter royalty(1)
+ 
+$
+ 292,181
+ 
+$
+ 1,766
+ 
+$
+ 23,609
+ 
+$
+ 25,806
+ 
+$
+ 241,000
+
+Remediation and reclamation expenditures(2)
+ 
+ 
+ 70,100
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 70,100
+
+Interest payments(4)
+ 
+ 
+22,665 
+ 
+ 
+4,398 
+ 
+ 
+13,157 
+ 
+ 
+5,110 
+ 
+ 
+ 
+
+Crofoot royalty(3)
+ 
+ 
+4,630 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+- 
+ 
+ 
+ 4,630
+
+Financing activities:
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Repayments of debt principal(4)
+ 
+ 
+147,171 
+ 
+ 
+126 
+ 
+ 
+301 
+ 
+ 
+146,744 
+ 
+ 
+ 
+
+Additional interest payments(5)
+ 
+ 
+7,149 
+ 
+ 
+2,200 
+ 
+ 
+4,949 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Total
+ 
+$
+ 543,896
+ 
+$
+ 8,490
+ 
+$
+ 42,016
+ 
+$
+ 177,660
+ 
+$
+ 315,730
+
+-77-
+
+Table of Contents
+
+(1)
+Under the Sprott Royalty Agreement, we are required to pay a perpetual royalty equal to 1.5% of the Net Smelter Returns from the Hycroft Mine, payable monthly that also includes an additional amount for withholding taxes payable by the royalty holder. Amounts presented above incorporate estimates of the current life-of-mine plan for mineral resources and are based on consensus pricing for gold and silver. See Note 10 - Deferred Gain on Sale of Royalty to the Notes to the First Quarter Financial Statements for additional information.
+
+(2)
+Mining operations are subject to extensive environmental regulations in the jurisdictions in which they are conducted and we are required, upon cessation of operations, to reclaim and remediate the lands that our operations have disturbed. The estimated undiscounted cash outflows of these remediation and reclamation obligations are reflected here. In the above presentation, no offset has been applied for the $59.3 million of our reclamation bonds or for the $34.3 million of cash collateral for those bonds included in Restricted Cash.
+
+(3)
+The Company is required to pay a 4% net profits royalty, including advance royalty payments of $120,000 in any year where mining occurs on the Crofoot claims and an additional $120,000 if tons mined from the Crofoot claim blocks exceed 5.0 million tons. See Note 21 - Commitments and Contingencies to the Notes to the First Quarter Financial Statements for additional information.. Amounts shown represent the current estimates of cash payment timing using consensus pricing for gold and silver.
+
+(4)
+Repayments of principal on debt consists of amounts due under the Sprott Credit Agreement (as amended by the Second A&R Agreement), the Assumed New Subordinated Notes and notes payable for equipment purchases. Included in the repayment of the Assumed New Subordinated Notes principal is interest that has been capitalized as payable in-kind on a quarterly basis, and on a monthly basis for the Sprott Credit Agreement (as amended by the Second A&R Agreement) for the first 12 months after the initial advance. Also included in the repayment of the Sprott Credit Agreement was the $3.3 million fee that has been capitalized as payable in-kind in connection with the Second A&R Agreement. See Note 9 - Debt, Net to the Notes to the First Quarter Financial Statements for additional information. 
+
+(5)
+Additional interest payments consist of repayments of additional interest under the Sprott Credit Agreement (as amended by the Second A&R Agreement), commencing February 28, 2021 (with the first cash payment due three months after such date) and ending on the maturity date. See Note 9 - Debt, Net to the Notes to the First Quarter Financial Statements for additional information.
+
+Debt covenants
+The Company s debt agreements contain representations and warranties, events of default, restrictions and limitations, reporting requirements, and covenants that are customary for agreements of these types.
+The Sprott Credit Agreement (as amended by the Second A&R Agreement) contains covenants that, among other things, restrict or limit the ability of the Company to enter into encumbrances (other than Permitted Encumbrances), incur indebtedness (other than Permitted Indebtedness), dispose of its assets (other than Permitted Disposals), pay dividends, and purchase or redeem shares, as such terms are defined in the Sprott Credit Agreement (as amended by the Second A&R Agreement). The Sprott Credit Agreement (as amended by the Second A&R Agreement) requires us to ensure that, at all times, both its Working Capital and Unrestricted Cash are at least $10.0 million (subsequently reduced by the Waiver and Waiver Amendment discussed below), as such terms are defined in the Sprott Credit Agreement (as amended by the Second A&R Agreement), and that at least every six months the Company demonstrates its ability to repay and meet all present and future obligations as they become due with a financial model that uses consensus gold prices discounted by 5.0%. The Subordinated Notes include customary events of default, including those relating to a failure to pay principal or interest, a breach of a covenant, representation or warranty, a cross-default to other indebtedness, and non-compliance with security documents. As of March 31, 2022, we were in compliance with all covenants under our debt agreements.
+On February 28, 2022, we entered into the February 2022 Waiver and Amendment with the Lender amending the November 2021 Waiver. Pursuant to the February 2022 Waiver and Amendment, the Lender: (i) waived the Company s obligation under the Sprott Credit Agreement to maintain at least $9.0 million of Unrestricted Cash on the last day of each calendar month during the period ending May 10, 2022 (the Waiver Period ), provided that, the Company maintained at least $7.5 million of Unrestricted Cash on the last day of February 2022 and at least $9.0 million on the last day of each month thereafter during the Waiver Period; (ii) waived all obligations of the Company to prepay the facility with the net cash proceeds of any Mill Asset Sales (as defined in the February 2022 
+
+-78-
+
+Table of Contents
+
+Waiver and Amendment) until the earlier of: (A) the date on which the Company completes a private placement or other offering or issuance of its equity securities (the Offering Date ); and (B) March 31, 2022; and (iii) extended the payment due date for the additional February interest payment and the February principal payment until the earlier of: (A) the Offering Date; and (B) March 31, 2022. Further, pursuant to the February 2022 Waiver and Amendment, any failure by the Company to comply with the terms of the preceding sentence would constitute an immediate Event of Default under the Credit Agreement.
+On March 11, 2022, the Company entered into the March 2022 Sprott Agreement with the Lender with respect to the Sprott Credit Agreement. As described in the March 2022 Sprott Agreement, we were contemplating Equity Financing Transactions to be completed on or before March 31, 2022. Pursuant to the March 2022 Sprott Agreement, if the Equity Financing Transactions result (or are likely to result pursuant to definitive subscription underwriting and/or similar legally binding agreements) in our receipt of total gross cash proceeds (before deduction of fees and expenses) of the Required Equity Amount on or before March 31, 2022, the Lender and the Company were obligated to amend the principal repayment terms under the Sprott Credit Agreement such that no further scheduled payments of principal shall be required prior to May 31, 2025 (the Maturity Date ) (i.e., there will be no required regular amortization payments of the facility and the full principal balance of the facility shall be due and payable in a single bullet payment on the Maturity Date). The consummation of the Private Placement satisfied the Required Equity Amount condition in the March 2022 Sprott Agreement.
+The March 2022 Sprott Agreement also provides that, in connection with the modification of the required facility amortization payments, the Company shall pay to the Lender an amount equal to $3.3 million, with such payment to be capitalized and added to the principal amount owing under the Sprott Credit Agreement and accrue interest at the same rate and upon the same terms as the existing loans under the Sprott Credit Agreement; provided, the payment or prepayment of such capitalized principal amount shall not be subject to the Prepayment Premium (as defined in the Sprott Credit Agreement) or any other penalty or premium.
+On March 14, 2022, we reached an agreement in principle with the Lender to modify the terms of the Sprott Credit Agreement and other applicable loan documents. On March 30, 2022, the Company and Lender entered into the Second A&R Agreement, which
+(i)
+extended the maturity date for all of the loans and other principal obligations under the Sprott Credit Facility by two years, to May 31, 2027;
+
+(ii)
+provided for the Initial Equity Proceeds Prepayment by the Company to in the amount of $10.0 million promptly upon the Company s receipt of cash proceeds from the Private Placement offering with AMC and Sprott;
+
+(iii)
+provided for the Subsequent Equity Proceeds Prepayments by the Company to prepay principal under the Second A&R Agreement in the amount of $13.9 million (representing 10% of the subsequent issuance of its equity interests consummated on or prior to March 31, 2022); and
+
+(iv)
+eliminated the prepayment premiums otherwise payable with respect to the Initial Equity Proceeds Prepayment, the Subsequent Equity Proceeds Prepayments and all future prepayments of principal under the Sprott Credit Facility.
+
+In addition, the Company s obligations (i) to prepay principal with proceeds of asset sales will be credited/offset by the $23.9 million aggregate amount of Initial Equity Proceeds Prepayment and the Subsequent Equity Proceeds Prepayments, and (ii) to maintain a minimum amount of Unrestricted Cash was increased to $15.0 million.
+Pursuant to the agreement in principal, the Company made the Initial Equity Proceeds Prepayment of $10.0 million and paid in kind a $3.3 million fee in connection with the modification and capitalized it to principal on March 16, 2022; and following the execution of the Second A&R Agreement on March 30, 2022, the Company (i) paid the previously deferred additional interest payment of $0.5 million, and (ii) made the Subsequent Equity Proceeds Prepayment of $13.9 million. After giving effect to such prepayments the outstanding principal balance under the Second A&R Agreement was estimated as of March 30, 2022 to be $57.9 million (before issuance discounts) including unpaid additional interest of approximately $7.1 million.
+
+-79-
+
+Table of Contents
+
+Our future liquidity and capital resources management strategy entails a disciplined approach to monitor the timing and depth of any drilling, metallurgical and mineralogical studies and the continuation of processing the remaining leach pad inventory while attempting to remain in a position that allows us to respond to changes in our business environment, such as a decrease in metal prices or lower than forecasted future cash flows, and changes in other factors beyond our control. We have undertaken efforts aimed at managing our liquidity and preserving our capital resources by, among other things:
+(i)
+monitoring metal prices and the impacts (near-term and future) they have on our business and cash flows;
+
+(ii)
+ceasing open pit mining operations to reduce net cash outflows while continuing to process leach pad inventory until such time as it is no longer economic;
+
+(iii)
+reducing the size of our workforce to reflect the cessation of mining operations;
+
+(iv)
+controlling our working capital and managing discretionary spending;
+
+(v)
+reviewing contractor usage and rental agreements for more economic options, including termination of certain agreements in accordance with their terms;
+
+(vi)
+decreasing restricted cash balances that collateralize bonds, as available; and
+
+(vii)
+planning the timing and amounts of capital expenditures and drilling, metallurgical and mineralogical study costs at the Hycroft Mine and deferring such items that are not expected to benefit our near term operating plans.
+
+We have undertaken and continue to undertake additional efforts to:
+(i)
+monetize non-core assets and excess materials and supplies inventories;
+
+(ii)
+return excess rental and leased equipment;
+
+(iii)
+sell certain uninstalled grinding mills that are not expected to be needed for a future milling operation;
+
+(iv)
+selling other uninstalled grinding mills if the proceeds contribute to enhancing a future milling operation; and
+
+(v)
+work with existing debt holders to adjust debt service requirements.
+
+In addition, as of October 6, 2021, we entered into an agreement with Randy Buffington, our former Chairman, President and Chief Executive Officer to terminate $0.7 million in aggregate future cash payments in exchange for the termination of the remainder of his restrictive covenant of non-competition and issuance of up to 275,000 shares of our Common Stock.
+Cash and liquidity
+We have placed substantially all of our cash in operating accounts with a well-capitalized financial institution, thereby ensuring balances remain readily available. Due to the nature of our operations and the composition of our current assets, our Cash Accounts receivable, and metal in Inventories represent substantially all of our liquid assets on hand. Additionally, we are provided with additional liquidity as ounces are recovered from the Ore on leach pads, processed into finished goods, and sold at prevailing spot prices to our customers.
+
+-80-
+
+Table of Contents
+
+The following table summarizes our projected sources of future liquidity, as recorded within the Consolidated Financial Statements (dollars in thousands):
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+December 31, 2021
+ 
+December 31, 2020
+
+Cash
+ 
+$
+ 12,342
+ 
+$
+ 56,363
+
+Accounts receivable
+ 
+ 
+ 
+ 
+ 
+ 426
+
+Metal in Inventories(1)
+ 
+ 
+ 6,693
+ 
+ 
+ 6,418
+
+Ore on leach pads(2)
+ 
+ 
+ 10,106
+ 
+ 
+ 38,041
+
+Total projected sources of future liquidity
+ 
+$
+ 29,141
+ 
+$
+ 101,248
+
+(1)
+Metal in Inventories, contained approximately 3,849 recoverable ounces of gold that are expected to be sold within the next nine months. Assuming a gold selling price of $1,806 per ounce (the December 31, 2021 P.M. fix) and excluding any proceeds from silver sales, the sale of all gold ounces estimated to be recovered from our metal inventories would provide us with $7.0 million of revenue. See Note 4 - Inventories and Ore on Leach Pads to the 2021 Year End Notes for additional information.
+
+(2)
+The current portion of Ore on leach pads contained approximately 7,130 ounces of gold that are expected to be processed into finished goods and then sold within the next 12 months. Assuming a gold selling price of $1,806 per ounce (the December 31, 2021 P.M. fix) and excluding any proceeds from silver sales, the sale of all gold ounces estimated to be recovered from our ore on leach pads would provide us with $12.9 million of revenue. See Note 4 - Inventories and Ore on Leach Pads to the 2021 Year End Notes for additional information.
+
+The year ended December 31, 2021 compared to the year ended December 31, 2020
+The following table summarizes our sources and uses of cash for the following periods (dollars in thousands):
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+Year Ended December 31,
+
+ 
+ 
+2021
+ 
+2020
+
+Net loss
+ 
+$
+ (88,564)
+ 
+$
+ (136,392)
+
+Net non-cash adjustments
+ 
+ 
+ 30,829
+ 
+ 
+ 76,809
+
+Net change in operating assets and liabilities
+ 
+ 
+ 20,697
+ 
+ 
+ (50,925)
+
+Net cash used in operating activities
+ 
+ 
+ (37,038)
+ 
+ 
+ (110,508)
+
+Net cash used in investing activities
+ 
+ 
+ (6,873)
+ 
+ 
+ (31,124)
+
+Net cash (used in) provided by financing activities
+ 
+ 
+ (5,494)
+ 
+ 
+ 188,705
+
+Net (decrease) increase in cash
+ 
+ 
+ (49,405)
+ 
+ 
+ 47,073
+
+Cash and restricted cash, beginning of period
+ 
+ 
+ 96,040
+ 
+ 
+ 48,967
+
+Cash and restricted cash, end of period
+ 
+$
+ 46,635
+ 
+$
+ 96,040
+
+ 
+Cash used in operating activities
+During the year ended December 31, 2021, we used $37.0 million of cash in operating activities primarily attributable to a net loss of $88.6 million, the cash impact of net loss was equal to $57.7 million, and $20.7 million provided by working capital, which included $29.0 million used to increase production-related inventories. The largest non-cash items included in net income during the year ended December 31, 2021 included Impairment charges of $17.3 million related to the Write-down of inventories and Impairment on equipment not in use, a $14.4 million gain from Fair value adjustments to warrants and Non-cash portion of interest expense of $16.8 million.
+For the year ended December 31, 2020, we used $110.5 million of cash for operating activities primarily attributable to a net loss of $136.4 million, the cash impact of net loss was equal to $59.6 million, and $50.9 million used for working capital, including the operational ramp up following the 2019 restart of the Hycroft Mine using a net $43.8 million to increase production-related inventory balances. Cash outflows during the year ended December 31, 2020 were partially offset by certain non-cash expenses included in Net loss, including $38.8 million of non-cash interest expense and a $17.9 million Write-down of inventories.
+
+-81-
+
+Table of Contents
+
+Cash used in investing activities
+For the year ended December 31, 2021 and 2020, we used $6.9 million and $31.1 million, respectively, in investing activities. For the year ended December 31, 2021, expenditures included (i) $2.7 million for purchased equipment and refurbishments; (ii) $2.5 million spent for the leach pad expansion project (which excludes $0.7 million of capitalized interest) to complete construction to the appropriate point in which we believe there would be minimal risk of adverse impacts to the leach pad. For the year ended December 31, 2020, the majority of the capital expenditures related to construction of new leach pad space.
+Cash (used in) provided by financing activities
+During the year ended December 31, 2021 we repaid $5.4 million of the Additional Interest and principal which is classified as debt under the terms of our Sprott Credit Agreement. Cash provided by financing activities was $188.7 million for the year ended December 31, 2020, which included proceeds from financing instruments consummated in connection with the Recapitalization Transaction of $254.8 million, offset by principal payments on debt of $132.4 million and payments for legal and consulting fees related to the Recapitalization Transaction of $16.1 million.
+Future capital and cash requirements
+The following table provides our gross contractual cash obligations as of December 31, 2021, which are grouped in the same manner as they were classified in the cash flows in order to provide a better understanding of the nature of the obligations and to provide a basis for comparison to historical information. We believe the following provides the most meaningful presentation of near-term obligations expected to be satisfied using current and available sources of liquidity (dollars in thousands):
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+Payments Due by Period
+
+ 
+ 
+ 
+ 
+ 
+Less than 1
+ 
+1 3
+ 
+3 5
+ 
+More than 5
+
+ 
+ 
+Total
+ 
+Year
+ 
+Years
+ 
+Years
+ 
+Years
+
+Operating activities:
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Net smelter royalty(1)
+ 
+$
+ 241,229
+ 
+$
+ 229
+ 
+$
+ 
+ 
+$
+ 
+ 
+$
+ 241,000
+
+Remediation and reclamation expenditures(2)
+ 
+ 
+ 70,100
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 70,100
+
+Interest payments(3)
+ 
+ 
+ 10,115
+ 
+ 
+ 5,730
+ 
+ 
+ 4,383
+ 
+ 
+ 2
+ 
+ 
+ 
+
+Crofoot royalty(4)
+ 
+ 
+ 4,630
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 4,630
+
+Financing activities:
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Repayments of debt principal(5)
+ 
+ 
+ 209,676
+ 
+ 
+ 15,157
+ 
+ 
+ 56,594
+ 
+ 
+ 137,925
+ 
+ 
+ 
+
+Additional interest payments(6)
+ 
+ 
+ 7,699
+ 
+ 
+ 2,200
+ 
+ 
+ 5,499
+ 
+ 
+ 
+ 
+ 
+ 
+
+Total
+ 
+$
+ 543,449
+ 
+$
+ 23,316
+ 
+$
+ 66,476
+ 
+$
+ 137,927
+ 
+$
+ 315,730
+
+(1)
+Under the Sprott Royalty Agreement, we are required to pay a perpetual royalty equal to 1.5% of the Net Smelter Returns from our Hycroft Mine, payable monthly that also includes an additional amount for withholding taxes payable by Sprott. Amounts presented above incorporate estimates of our current life-of-mine plan, and are based on consensus pricing for gold and silver. See Note 11 - Deferred Gain on Sale of Royalty to the 2021 Year End Notes for additional information.
+
+(2)
+Mining operations are subject to extensive environmental regulations in the jurisdictions in which they are conducted and we are required, upon cessation of operations, to reclaim and remediate the lands that our operations have disturbed. The estimated undiscounted cash outflows of these remediation and reclamation obligations are reflected here. In the above presentation, no offset has been applied for the $59.3 million of our reclamation bonds or for the $34.3 million of cash collateral for those bonds included in Restricted Cash.
+
+(3)
+Under the Sprott Credit Agreement, we were required to pay interest beginning in the 13th month after the initial advance on May 29, 2020 to Sprott Private Resource Lending II (Collector), LP.
+
+(4)
+We are required to pay a 4% net profits royalty, including advance minimum royalty payments of $120,000 in any year where mining occurs on the Crofoot claims and an additional minimum royalty of $120,000 if tons mined from the Crofoot claim blocks exceed 5.0 million tons. See Note 23 - Commitments and Contingencies to the 2021 Year End Notes. Amounts shown represent our current estimates of cash payment timing using consensus pricing for gold and silver.
+
+-82-
+
+Table of Contents
+
+(5)
+Repayments of principal on debt consists of amounts due under the Sprott Credit Agreement, the Subordinated Notes and notes payable for equipment purchases. Included in the repayment of the Subordinated Notes principal is interest that has been capitalized as payable in-kind on a quarterly basis, and on a monthly basis for the Sprott Credit Agreement for the first 12 months after the initial advance.
+
+(6)
+Additional interest payments consist of repayments of additional interest under the Sprott Credit Agreement, commencing February 28, 2021 (with the first cash payment due three months after such date) and ending on the maturity date.
+
+Off-balance sheet arrangements
+As of March 31, 2022, our off-balance sheet arrangements consisted of a net profit royalty arrangement and a net smelter royalty arrangement (see Note 21 - Commitments and Contingencies to the Notes to the First Quarter Financial Statements).
+As of December 31, 2021, our off-balance sheet arrangements consisted of a net profit royalty arrangement and a net smelter royalty arrangement.
+Accounting Developments
+The following accounting pronouncements were adopted by the Company during the three months ended March 31, 2022:
+In August 2020, the FASB issued ASU No. 2020-06, Accounting for Convertible Instruments and Contracts in an Entity s Own Equity ( ASU 2020-06 ). ASU 2020-06 simplifies guidance on accounting for convertible instruments and contracts in an entity s own equity including calculating diluted earnings per share. For emerging growth companies, the new guidance is effective for annual periods beginning after December 15, 2022. The Company early adopted ASU 2020-06 as of January 1, 2022, with no material impact on its condensed consolidated financial statements or the related disclosures.
+In December of 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes ( ASU 2019-12 ), as part as part of its overall simplification initiative to reduce costs and complexity of applying accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements. Amendments include removal of certain exceptions to the general principles of ASC 740, Income Taxes and simplification in several other areas such as accounting for a franchise tax (or similar tax) that is partially based on income. For emerging growth companies, the new guidance was effective for annual periods beginning after December 15, 2021 and the Company adopted ASU 2019-12 as of January 1, 2022, with no material impact on its condensed consolidated financial statements or the related disclosures.
+In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity s Own Equity (Subtopic 815-40): Issuer s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options (a consensus of the FASB Emerging Issues Task Force). ASU 2021-04 clarifies and reduces diversity in an issuer s accounting for modifications or exchanges of freestanding equity-classified written call options (e.g., warrants) that remain equity classified after modification or exchange. ASU 2021-04 provides guidance that will clarify whether an issuer should account for a modification or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange as (i) an adjustment to equity and, if so, the related earnings per share effects, if any, or (ii) an expense and, if so, the manner and pattern of recognition. For emerging growth companies, the new guidance was effective for annual periods beginning after December 15, 2021 and the Company adopted ASU 2021-04 as of January 1, 2022, with no material impact on its condensed consolidated financial statements or the related disclosures.
+Critical Accounting Estimates
+MD&A is based on our 2021 Year End Financial Statements and First Quarter Financial Statements, each of which has been prepared in accordance with GAAP. The preparation of these statements requires us to make assumptions and estimates that affect the reported amounts. We base our assumptions and estimates on historical experience and various other sources that we believe to be reasonable at the time our estimates are made. Actual results may differ from amounts estimated in these statements, and such difference could be material. As such, future events and their effects cannot be determined with certainty.
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+Although other estimates are used in preparing our financial statements, we believe that the following accounting estimates are the most critical to understanding and evaluating our reported financial results. For information on all of our significant accounting policies, see Note 2 - Summary of Significant Accounting Policies to the 2021 Year End Notes.
+Ore on leach pads
+Estimate Required:
+The recovery of gold and silver at the Hycroft Mine is currently accomplished through a heap leach process, the nature of which limits our ability to precisely determine the recoverable gold ounces in Ore on leach pads. We estimate the quantity of recoverable gold ounces in ore on leach pads using surveyed volumes of material, ore grades determined through sampling and assaying of blastholes, and estimated recovery rates based on ore type and domain and level of oxidation actually achieved or expected to be achieved prior to leaching. The quantity of recoverable gold ounces and recovery rates varies based on ore mineralogy, steps in the leach process, ore grade, ore particle sizes and the percentage of cyanide soluble gold. The estimated recoverable gold ounces placed on the leach pads are periodically reconciled by comparing the related ore to the actual gold ounces recovered (metallurgical balancing). The ultimate recoverable gold ounces or life-of-mine recovery rate is unknown until mining operations cease. A change in the recovery rate or the quantity of recoverable gold ounces in our stockpiles or ore on leach pads could materially impact our financial statements.
+Impact of Change in Estimate:
+Changes in recovery rate estimates or estimated recoverable gold ounces that do not result in write-downs are accounted for on a prospective basis. If a write-down is required, ore on leach pads would be adjusted to market values before prospectively accounting for the remaining costs and revised estimated recoverable gold ounces. During the year ended December 31, 2021, we did not recognize any write-downs related to estimated ounces on our in-service leach pads.
+At December 31, 2021, if our estimate of recoverable gold ounces on the leach pad decreased by 2.5% or 5.0%, recoverable gold ounces in Ore on leach pads would decrease by approximately 178 ounces or 357 ounces, respectively, which would require a write-down of $0.3 million or $0.5 million, respectively, of our Ore on leach pads costs before prospectively accounting for the remaining costs. A 2.5% or 5.0% increase to our estimate of recoverable gold ounces in Ore on leach pads would increase the estimated recoverable ounces by the aforementioned amounts and would not result in a change to our weighted average cost per ounce.
+Impairment of long-lived assets
+Estimate Required:
+Our long-lived assets consist of Plant, equipment, and mine development, net. We review and evaluate our long-lived assets for impairment when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. Events that may trigger a test for recoverability include, but are not limited to, significant adverse changes to projected revenues, costs, or future expansion plans or changes to federal and state regulations (with which we must comply) that may adversely impact our current or future operations. An impairment is determined to exist if the total projected future cash flows on an undiscounted basis are less than the carrying amount of a long-lived asset group. An impairment loss is measured and recorded based on the excess carrying value of the impaired long-lived asset group over fair value.
+To determine fair value, we used a market-based approach for determining fair value based on sales transactions of comparable assets. Assets are grouped at the lowest level for which there are identifiable cash flows that are largely independent of future cash flows from other asset groups. Our estimates of future cash flows from the potential sale of our assets are based on numerous assumptions that are consistent or reasonable in relation to transactions occurring in the market and actual future cash flows may be significantly different than the estimates as each are each subject to significant risks and uncertainties.
+Impact of Change in Estimate:
+The estimates and assumptions used to determine the fair value of our long-lived assets as of December 31, 2021 were based upon sales transactions of comparable assets. We compared the estimated $162.0 million estimated fair value, after allocating the fair value 
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+to other assets and liabilities, to the carrying value of our Plant, equipment, and mine development, net of $58.5 million, and given the large surplus between the estimated fair value of the Company and the carrying value of our Plant, equipment, and mine development, net a change in the estimates used in the market-based approach would be unlikely to result in an impairment as of December 31, 2021.
+Asset retirement obligation ( ARO )
+Estimate Required:
+We will be required to perform reclamation activity at the Hycroft Mine in the future. As a result of this requirement, an ARO has been recorded on our consolidated balance sheets that is based on our expectation of the costs that will be incurred years in the future. Any underestimate or unanticipated reclamation costs or any changes in governmental reclamation requirements could require us to record or incur additional reclamation costs. ARO liabilities are accrued when they become known, are probable and can be reasonably estimated. Whenever a previously unrecognized ARO liability becomes known, or a previously estimated reclamation cost is increased, the amount of that liability and additional cost will be recorded at that time and could materially reduce our consolidated net income attributable to stockholders.
+Impact of Change in Estimate:
+Based on our current proposed 34-year mine plan set forth in the 2019 Hycroft TRS, which we believe remains the best estimate for the life of mine, no significant reclamation activity will be made until 2047. However, if the significant reclamation activity were to begin in 2042 or 2045 our reclamation liability would increase by approximately $1.9 million and approximately $0.7 million, respectively.
+Warrant liability
+Estimate Required:
+We account for the 5-Year Private Warrants to purchase shares of our common stock that are not indexed to our own stock as liabilities at fair value on the balance sheet. The warrants are subject to remeasurement at each balance sheet date, and any change in fair value is recognized as a component of Other income (expense), net on the statement of operations. We will continue to adjust the liability for changes in fair value of the 5-Year Private Warrants until the earlier of the (i) exercise or expiration of the 5-Year Private Warrants or (ii) the transfer of any 5-Year Private Warrants to any person who is not a permitted transferee, at which time the applicable warrant liability will be extinguished. The terms of the 5-Year Private Warrants are substantially identical to the 5-Year Public Warrants except the 5-Year Private Warrants, while held by the SPAC sponsor and/or SPAC underwriter and their permitted transferees, are precluded from mandatory redemption and are entitled to exercise on a cashless bases at the holder s election. Accordingly, we use a Black-Scholes model with an appropriate estimate of volatility considering volatility of the 5-Year Public Warrants and using a Monte Carlo simulation model to incorporate the redemption and cashless exercise features in the 5-Year Private Warrants. Increases (decreases) in the assumptions result in a directionally similar impact to the fair value of the warrant liability.
+Impact of Change in Estimate:
+A $0.01 increase or decrease in the fair value estimate of 5-Year Private Warrants would increase or decrease the warrant liability, by $0.1 million with the offset in Other income (expense).
+ 
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+MANAGEMENT
+Management and Board of Directors
+The below is a list of our current executive officers and directors as of May 13, 2022, and their respective ages and a brief account of each of their business experience:
+ 
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Name
+ 
+Age
+ 
+Position(s)
+ 
+
+Diane R. Garrett, Ph.D.
+ 
+62
+ 
+President, Chief Executive Officer and Director
+ 
+
+Sean D. Goodman
+ 
+56
+ 
+Director
+ 
+
+Michael Harrison
+ 
+50
+ 
+Director
+ 
+
+Stephen A. Lang
+ 
+66
+ 
+Chairman of the Board
+ 
+
+David Naccarati
+ 
+69
+ 
+Director
+ 
+
+Thomas Weng
+ 
+53
+ 
+Director
+ 
+
+Marni Wieshofer
+ 
+59
+ 
+Director
+ 
+
+Stanton K. Rideout
+ 
+62
+ 
+Executive Vice President and Chief Financial Officer
+ 
+
+ 
+We have determined that each of Messrs. Goodman, Harrison, Lang, Naccarati and Weng and Ms. Wieshofer are independent directors under Nasdaq listing standards. The Board reviews independence on an annual basis and has also determined that each current member of the Company s Audit Committee, Compensation Committee and Nominating and Corporate Governance Committee is independent as defined under the applicable Nasdaq listing standards and SEC rules. The Board further determined that Ms. Wieshofer qualifies as an audit committee financial expert in accordance with applicable rules and guidance. In making these determinations, the Company s Board found that none of these directors had a material or other disqualifying relationship with the Company.
+Diane R. Garrett, Ph.D., began serving as our President and Chief Executive Officer and a director on September 8, 2020, was Acting Chair of the Board from December 15, 2021 through April 8, 2022 and is a member of the Board. From June 2016 until her appointment with the Company, Ms. Garrett was the President and Chief Executive Officer of Nickel Creek Platinum Corp. ( NCP ), a mining exploration and development company listed on the Toronto Stock Exchange and the OTC-QB Market. She has more than 20 years of senior management and financial expertise in the field of natural resources. Prior to joining NCP, she held the position of President and Chief Executive Officer and a director of Romarco Minerals Inc. ( Romarco ) from November 2002 until October 2015, taking the multi-million-ounce Haile Gold Mine project from discovery to construction. Romarco was acquired by OceanaGold, Inc. in 2015, at which time Ms. Garrett became a director and consultant to OceanaGold, Inc. before joining NCP in June 2016. Prior to that, she held numerous senior positions in public mining companies including VP of Corporate Development at Dayton Mining Corporation and VP of Corporate Development at Beartooth Platinum Corporation. Early in her career, Ms. Garrett was the Senior Mining Analyst and Portfolio Manager in the precious metals sector with US Global Investors. Ms. Garrett received her Ph.D. in Engineering and her Masters in Mineral Economics from the University of Texas at Austin. The Board has determined that Ms. Garrett should serve as a director due to her technical expertise and background as a senior executive in mining companies as well as her significant experience with permitting, developing and constructing gold mines and moving a precious-metals mining company from the development stage to the successful producer stage, Ms. Garrett is also a director of Novagold Resources Inc., a mineral exploration company operating in the gold mining industry (NYSE American: NG; TSE: NG) and Ausenco PYT Ltd., a privately held global engineering firm. Ms. Garrett s brother, David Thomas, is the General Manager of the Hycroft Mine.
+Sean D. Goodman has been a member of our Board since April 8, 2022 and was appointed as a member of the Audit and Nominating and Governance Committees on April 8, 2022. Mr. Goodman is the Executive Vice President and Chief Financial Officer of AMC Entertainment Holdings, Inc. (NYSE: AMC) and has served in this position since February 2020. Prior to joining AMC, Mr. Goodman was Chief Financial Officer of Asbury Automotive Group, Inc. (NYSE: ABG) from July 2017 to November 2019 and the Chief Financial Officer of Unifi, Inc. (NYSE: UFI) from January 2016 to June 2017. Earlier in his career, Mr. Goodman served in various senior strategy and finance roles at The Home Depot, Inc. (NYSE: HD). Mr. Goodman began his career as an investment banker with Morgan Stanley (NYSE: MS) and in various consulting and public accounting positions with Deloitte LLP. Mr. Goodman has a Master of Business Administration degree from The Harvard Business School and a Bachelor of Business Science degree (with honors) from the University of Cape Town in South Africa. Mr. Goodman is a certified public accountant. Mr. Goodman is the designated representative of AMC pursuant to the Subscription Agreement entered into with the Company. The Board has also determined that Mr. Goodman s financial, strategic, capital markets and information technology skills and experience as a chief 
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+financial officer of a publicly-traded company add valuable insight and experience to the Board as well as provide the perspective of a large stockholder.
+Michael Harrison has been a member of our Board since May 29, 2020 and is the Chairman of the Safety, Sustainability & Technical Committee and a member of the Nominating and Governance Committee. Since January 2, 2020, Mr. Harrison has served as Managing Partner, Sprott Resource Streaming and Royalty and Managing Director of Sprott, Inc. Since January 2, 2020, Mr. Harrison has served as the CEO of Sprott Resource Streaming and Royalty Corp. From May 7, 2019 to June 23, 2020, Mr. Harrison served as the Interim President and Chief Executive Officer of Sprott Resource Holdings Inc. ( SRHI ) and prior to such date served as a Managing Director in the mining and metals group of SRHI since February 2017. Prior to joining SRHI, he held the position of President and CEO of Adriana Resources Inc. from October 2015 to February 2017, and Vice President, Corporate Development for Coeur Mining Inc. from February 2011 to August 2015. Mr. Harrison previously served on the Board of Directors of Corsa Coal Corp. (TSXV: CSO) from March 2011 to March 2017 and on the board of directors of Macusani Yellowcake (TSXV: PLU) from May 2011 to January 2013. Mr. Harrison also served as a member of the Board of Directors of Hycroft Mining Corporation ( HMC ), the Company s predecessor, from December 2017 until the May 29, 2020 recapitalization transaction with HMC. He also previously worked for Cormark Securities Inc. and National Bank Financial in the mining investment banking groups raising funds and providing mergers and acquisition advice to listed and private mining companies, including the creation of Seller s predecessor company. Previously, he worked internationally for BHP Billiton Exploration Division as a Project Geophysicist. Mr. Harrison holds a B.Sc.E (Honours) in Geophysics from Queen s University, and an MBA (with Distinction) from the University of Western Ontario. Mr. Harrison brings over 25 years of executive, financial and technical knowledge in the mining industry to our Board and adds a valuable perspective.
+Stephen A. Lang has been a member of our Board since May 2021, Chairman of our Board since April 8, 2022, and is the Chairman of the Compensation Committee and a member of the Nominating and Governance Committee and the Safety, Sustainability & Technical Committee. Mr. Lang has over 40 years of experience in the mining industry, including engineering, development and production at gold, coal, base metals and PGM operations. He was Chief Executive Officer of Centerra Gold Inc., a publicly traded mining company, from 2008 to 2012 and served as Centerra s Board Chair from 2012 to 2019. Prior to that, he served as Chief Operating Officer at Stillwater Mining Company, Vice President/General Manager at Barrick Goldstrike operations, Vice President of Engineering and Project Development for Rio Algom Ltd, General Manager of the Fort Knox Mine for Kinross Gold/Amax Gold, and General Manager at the Twin Creeks and Lone Tree mines for Santa Fe Pacific Gold. He is currently Board Chair at Hudbay Minerals, and a member of the board of directors of each of International Tower Hill Mines Ltd., Bear Creek Mining Corporation and Argonaut Gold Inc. Mr. Lang holds a BS and MS in Mining Engineering from the Missouri University of Science and Technology. Mr. Lang served as a director of Allied Nevada Gold Corporation ( Allied Nevada ) from June 2013 until October 2015. Allied Nevada entered federal bankruptcy proceedings in March 2015, emerged in October 2015 and was the prior owner of the Hycroft Mine. Mr. Lang is well qualified to serve as a member of our Board due to his significant experience in the mining industry, together with his director and leadership experience with other mining companies.
+David C. Naccarati has been a member of our Board since May 2021 and is a member of the Audit Committee and the Safety, Sustainability & Technical Committee. Mr. Naccarati has more than 45 years of experience in the mining industry. He currently serves as an independent consultant to the mining industry. He was a founding partner of Cupric Canyon Capital, LLC, a private equity firm focused on acquiring and developing mining properties, and served as a member of its board of directors from 2010 to 2019. Mr. Naccarati was a member of the senior management team for Phelps Dodge Corporation, the mining company, from 2004 to 2007, including serving as president of the Phelps Dodge Mining Company, a division of Phelps Dodge Corporation. Mr. Naccarati also served as an adjunct professor in the department of Mining and Geological Engineering at the University of Arizona from 2009 to 2011. Mr. Naccarati received a degree in Mining Engineering from the University of Arizona and an MBA from Sloan School of Management (MIT). Mr. Naccarati is well qualified to serve as a member of our Board due to his significant safety, technical and operational experience in the mining industry.
+Thomas Weng has been a member of our Board since May 29, 2020 and is a member of the Audit Committee, the Compensation Committee and is Chairman of the Nominating and Governance Committee. Mr. Weng served as our Lead Independent Director from December 15, 2021 until the appointment of Stephen Lang as Chairman of the Board on April 8, 2022 replacing the non-independent, Acting Chair, Ms. Garrett. Mr. Weng has more than 25 years of experience in the financial services sector and is a Co-Founding Partner with Alta Capital Partners, a provider of financial advisory services (since February 2011). From February 2007 to January 2011, Mr. Weng was a Managing Director at Deutsche Bank and Head of Equity Capital Markets for Metals and Mining throughout the Americas and across all industry segments for Latin America. Prior to 2007, he held various senior positions at Pacific 
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+Partners, an alternative investment firm, and Morgan Stanley and Bear Stearns. Mr. Weng currently sits on the board of International Tower Hill Mines and Jaguar Mining Inc. Mr. Weng graduated from Boston University with a Bachelor of Arts in Economics. Mr. Weng is well qualified to serve as a member of our Board because of his extensive knowledge of strategic planning, mergers and acquisitions, finance, and mining.
+Marni Wieshofer has been a member of our Board since May 29, 2020 and is Chairwoman of the Audit Committee and a member of the Compensation Committee. Ms. Wieshofer has served as Head of Media and Managing Director in Houlihan Lokey s TMT Corporate Finance Group, based out of Los Angeles, providing mergers and acquisitions, capital markets, financial advisory and financial restructuring services including the Weinstein Company and Relativity Media bankruptcies and subsequent sales. Before joining Houlihan Lokey, Ms. Wieshofer was Partner and Managing Director at MESA, a boutique advisory investment bank, where she spearheaded investment banking, strategy, and valuation engagements for companies throughout the media space. Her background also includes Chief Financial Officer and EVP of Corporate Development at Lionsgate Entertainment where she oversaw the company s mergers, acquisitions, and other strategic financial initiatives including the acquisitions and integration of Trimark Pictures, Artisan Entertainment and Redbus Films Distribution U.K. to name a few, as well as the sale of Lionsgate Studios and the Canadian distribution business. Ms. Wieshofer s experience also includes prominent roles at Media Rights Capital, Alliance Atlantis Communications and Coopers & Lybrand Chartered Accountants. Ms. Wieshofer is currently Lead Director at Thunderbird Entertainment Group Inc. (TSXV: TBRD, OTC: THBRF), a member of the Board of Directors of Organigram Holdings Inc. (NASDAQ: OGI; TSE: OGI), a member of the Emeritus Board of Directors of Film2Future, a member of the Dean s Advisory Committee at the Rotman School of Management; and is a former Director and Chair of the Audit Committee of Takara Resources Inc. Ms. Wieshofer holds a BA from Western University, an MBA from the Rotman School of Management, is a Canadian Chartered Accountant and obtained the ICD.D designation in 2018. Ms. Wieshofer is well-qualified to serve as a member of our Board due to her expertise in mergers and acquisitions, capital markets, financial advisory and financial restructuring services across a range of industries.
+Stanton K. Rideout has served as our Executive Vice President and Chief Financial Officer since October 2020. He has more than 30 years of senior executive experience in the mining and manufacturing industries, including Romarco and Phelps Dodge Corporation ( Phelps Dodge ). From April 2018 until October 2020, Mr. Rideout was a consulting Chief Executive Officer of Carolina Gold Resources Inc. ( CGR ), a Canadian precious and base metals project-generator company. He joined the Board of CGR in June 2017 and became Chairman of the Board in July 2018. Prior to that, Mr. Rideout served as the Senior Vice President and Chief Financial Officer of Romarco from November 2010 through December 2015. Since Romarco was acquired by OceanaGold in September 2015, he provided debt and equity consulting services for a number of mining companies. From January 2008 until May 2008, Mr. Rideout was Executive Vice President and Chief Financial Officer for Swift Transportation Corporation ( Swift ), a large North American truckload carrier. Prior to Swift, Mr. Rideout held various senior finance and accounting positions over 25 years with Phelps Dodge, a publicly traded mining and manufacturing company. Those roles included Vice President and Treasurer, Vice President and Controller, and Investor Relations Officer and Chief Financial Officer of Phelps Dodge. Mr. Rideout earned his Master s in Business Administration from the University of Evansville and his Bachelor of Science, Business/Finance, from Western Kentucky University. Mr. Rideout is a Certified Public Accountant.
+Board of Directors
+Our Board currently consists of seven members. In accordance with our charter, members of our Board serve one-year terms and hold office until the next annual meeting of stockholders or until her of his respective successors are duly elected and qualified, or until their earlier resignation, retirement, disqualification or removal. Under our certificate of incorporation, the size of our Board shall be at least one member or such larger number as may be fixed from time to time by resolution of at least a majority of the directors then in office.
+Committees of the Board of Directors
+We have four standing committees. The Audit Committee, the Compensation Committee and the Nominating and Governance Committee are each composed solely of independent directors. In addition, the Safety, Sustainability and Technical Committee currently has three independent directors. Each of the committees reports to the Board as it deems appropriate and as the Board may request. The composition, duties and responsibilities of these committees are set forth below.
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+Audit Committee
+David C. Naccarati, Thomas Weng and Marni Wieshofer (Chair) are the members of the Audit Committee. Mr. Goodman was appointed to be a member of the Audit Committee on April 8, 2022. Under the Nasdaq listing standards and applicable SEC rules, the Audit Committee is required to have at least three members. Subject to phase-in rules and a limited exception, the rules of Nasdaq and Rule 10A-3 of the Exchange Act require that the audit committee of a listed company be comprised solely of independent directors. Each of Mr. Naccarati, Mr. Weng, Mr. Goodman and Ms. Wieshofer qualify as independent directors under applicable rules. Each member of the Audit Committee is financially literate and Ms. Wieshofer qualifies as an audit committee financial expert as defined under applicable SEC rules.
+Under its charter, the functions of the Audit Committee include:
+ the appointment, compensation, retention, replacement, and oversight of the work of the independent accounting firm engaged by the Company;
+ the pre-approval of all non-audit services to be provided by the independent auditors or any other registered public accounting firm engaged by the Company;
+ setting clear hiring policies for employees or former employees of the independent registered public accounting firm;
+ obtaining and reviewing a report, at least annually, from the independent auditors describing (i) the independent auditor s internal quality-control procedures and (ii) any material issues raised by the most recent internal quality-control review, or peer review, of the audit firm, or by any inquiry or investigation by governmental or professional authorities within the preceding five years respecting one or more independent audits carried out by the firm and any steps taken to deal with such issues;
+ reviewing and approving any related party transaction required to be disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC;
+ discussing with management and the independent auditor, as appropriate, any audit problems or difficulties and management s response, and our risk assessment and risk management policies, including our major financial risk exposure and steps taken by management to monitor and mitigate such exposure; and
+ reviewing our financial reporting and accounting standards and principles, significant changes in such standards or principles or in their application and the key accounting decisions affecting our financial statements, including alternatives to, and the rationale for, the decisions made.
+Compensation Committee
+Stephen Lang (Chair), Marni Wieshofer and Thomas Weng are the members of the Compensation Committee. All of the members of the Compensation Committee are independent directors under applicable Nasdaq listing standards and are considered to be a non-employee director under Rule 16b-3 of the Exchange Act.
+Under its charter, the functions of the Compensation Committee include:
+ reviewing and approving annually corporate goals and objectives relating to the compensation of the Chief Executive Officer ( CEO ), evaluating the performance of the CEO in light of those goals and reviewing and establishing the CEO s annual compensation and HYMC 2020 Performance and Incentive Pay Plan ( Incentive Plan ) participation levels and bases of participation; and
+ reviewing and approving annually the evaluation process and compensation structure for the Company s or its subsidiaries other officers; to evaluate, review and recommend to our Board any changes to, or additional, stock-based and other incentive 
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+compensation plans; and to recommend inclusion of the Compensation Discussion and Analysis, if applicable, in the annual proxy statement and Annual Report on Form 10-K to be filed with the SEC.
+In addition, on an annual basis, the Compensation Committee will conduct an in-depth, broad scope and detailed review of succession planning efforts at multiple levels of our management team.
+The Compensation Committee charter also provides that the Compensation Committee shall have the sole authority to retain or obtain the advice of a compensation consultant, legal counsel or other adviser. However, before engaging or receiving advice from a compensation consultant, external legal counsel or any other adviser, the Compensation Committee will consider the independence of each such adviser, including the factors required by Nasdaq and the SEC.
+Nominating and Governance Committee
+Michael Harrison, Stephen Lang and Thomas Weng (Chair) are the members of the Nominating and Governance Committee. Mr. Goodman was appointed as a member of the Nominating and Governance Committee on April 8, 2022. All of the members of the Nominating and Governance Committee are independent directors under applicable Nasdaq listing standards.
+Under its charter, the functions of the Nominating and Governance Committee include:
+ identifying individuals qualified to become Board members and recommending to the Board the director nominees for the next annual meeting of stockholders;
+ recommending to the Board the corporate governance guidelines applicable to the Company;
+ leading the Board in its annual review of the performance of (i) the Board; (ii) its committees; and (iii) management; and
+ recommending to the Board nominees for each Board committee.
+The Nominating and Governance Committee shall have the sole authority to retain and terminate any search firm to be used to identify director candidates and shall have sole authority to approve the search firm s fees and other retention terms.
+The Nominating and Governance Committee has not set specific minimum qualifications for director positions. Instead, the Nominating and Governance Committee will review nominations for election or re-election to the Board on the basis of a particular candidate s merits and the Company s needs after taking into account the current composition of the Board. When evaluating candidates annually for nomination for election, the Nominating and Governance Committee will consider an individual s skills, diversity, independence, experience in areas that address the needs of the Board and ability to devote adequate time to Board duties. The Nominating and Governance Committee does not specifically define diversity, but values diversity of experience, perspective, education, race, gender, and national origin as part of its overall annual evaluation of director nominees for election or re-election. Whenever a new seat or a vacated seat on the Board is being filled, candidates that appear to best fit the needs of the Board and the Company will be interviewed and evaluated by the Nominating and Governance Committee. Candidates selected by the Nominating and Governance Committee will then be recommended to the full Board.
+While the Company maintains a plurality voting standard in the election of directors, it has adopted a majority voting standard as well. Under that standard, any director in an uncontested election that receives more withheld votes than votes for his or her election must tender his or her resignation. The Nominating and Governance Committee will consider such offered resignation and recommend an action to the full Board which will then determine whether to accept or reject that resignation.
+Safety, Sustainability and Technical Committee
+Michael Harrison (Chair), Stephen Lang and David C. Naccarati are members of the Safety, Sustainability and Technical Committee.
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+Under its charter, the functions of the Safety, Sustainability and Technical Committee include the authority to:
+ investigate any activity of the Company or its subsidiaries relating to health, safety, loss prevention and operational security, sustainable development, environmental affairs, public policy and relations with communities and civil society, government relations, human rights and communication matters;
+ review our developmental, construction and operational activities; and
+ retain outside counsel, experts and other advisors as the Safety, Sustainability and Technical Committee may deem appropriate in its sole discretion to assist the Company in fulfilling its responsibilities.
+Director Independence
+The Board has determined that Messrs. Goodman, Harrison, Lang, Naccarati and Weng and Ms. Wieshofer are independent directors under Nasdaq listing standards. The Board reviews independence on an annual basis and has also determined that each current member of the Company s Audit Committee, Compensation Committee and Nominating and Governance Committee is independent as defined under the applicable Nasdaq listing standards and SEC rules. The Board further determined that Ms. Wieshofer qualifies as an audit committee financial expert in accordance with applicable rules and guidance. In making these determinations, the Board found that none of these directors had a material or other disqualifying relationship with the Company.
+In connection with the review and determination of the independence of directors, the Nominating and Governance Committee reviewed the relationship of Mr. Harrison to the various Sprott entities. Mr. Harrison is a Managing Director of Sprott, Inc. and the Managing Partner of Sprott Resource Streaming and Royalty ( SRSR ), an affiliate of Sprott Private Resource Lending II (CO), Inc., the payee under the Sprott Royalty Agreement. Under the Nasdaq independence rules, Nasdaq considers payments to or from a listed company in excess of 5% of the recipient s gross revenues a bar to independence of a director if that director is a partner, controlling shareholder or executive officer of such other party. In addition, certain institutional stockholder organizations, such as ISS, consider a transactional relationship to be material if the company makes annual payments to, or receives annual payments from, another entity, exceeding the greater of: $200,000 or 5% of the recipient s gross revenues. The Company s annual payments to SRSR did not exceed the ISS test nor the Nasdaq threshold for independence. Therefore, any payments under the Sprott Royalty Agreement in 2021 did not preclude a finding of Mr. Harrison s independence by the Board under Nasdaq rules or ISS guidelines.
+Board and Committee Meetings
+During the year ended December 31, 2021, the Board held 19 meetings and acted by unanimous written consent three times; the Audit Committee held seven meetings and acted one time by unanimous written consent; the Nominating and Governance Committee held three meetings and acted one time by unanimous written consent; the Compensation Committee held three meetings and acted by unanimous written consent two times; and the Safety, Sustainability and Technical Committee held seven meetings. During 2021, each director attended more than 75% of the combined meetings of the Board and each committee on which he or she served.
+Communications with the Board
+Stockholders can send communications to one or more members of the Board by writing to the Board or to specific directors or a group of directors at the following address: Hycroft Mining Holding Corporation Board of Directors, Hycroft Mining Holding Corporation, c/o Corporate Secretary, 4300 Water Canyon Road, Unit #1, Winnemucca, Nevada 89445. Any such communication will be promptly distributed by our Secretary to the individual director or directors named in the communication or to all directors if the communication is addressed to the entire Board.
+Director Compensation
+In 2020, the Compensation Committee and Board of Directors approved the following initial annual director compensation arrangements, for non-employee directors, in the form of (i) an annual cash retainer of $55,000; (ii) annual committee chair fees of $12,500 for the Audit Committee, $10,000 for the Safety, Sustainability and Technical Committee, and $7,500 for each of the Nominating and Governance and Compensation Committees; (iii) annual committee member fees of $5,000 for the Audit Committee, $4,000 for the Safety, Sustainability and Technical Committee, and $2,500 for each of the Nominating and Governance and 
+
+-91-
+
+Table of Contents
+
+Compensation Committees; and (iv) $75,000 in annual equity awards in the form of restricted stock units. In addition, an initial equity award in the amount of $50,000 was approved for each non-employee director in connection with their initial appointment to the Board. In addition, the Compensation Committee approved an annual cash retainer for the independent Lead Director and an annual cash retainer of $120,000 for a non-employee independent Chairman of the Board based upon the expected attention and workload as the Company addresses its financial issues. The Compensation Committee will re-evaluate the annual compensation for the non-employee independent Chairman of the Board prior to the 2022 annual meeting of stockholders.
+In 2021 equity awards were granted to each non-employee director at the annual meeting annual stockholder meeting of the Company and will continue to be awarded at each annual stockholder meeting of the Company unless otherwise determined by the Compensation Committee.
+The following table sets forth information concerning the compensation of our non-employee directors for the fiscal year ended December 31, 2021.
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+Fees Earned or
+ 
+ 
+ 
+ 
+
+ 
+ 
+Paid in Cash
+ 
+Stock Awards
+ 
+Total
+
+Name
+ 
+($)
+ 
+($)(1)
+ 
+($)(1)
+
+David Kirsch (2)
+ 
+$
+ 48,750
+ 
+$
+ 75,000
+ 
+$
+ 123,750
+
+Eugene Davis (3)
+ 
+$
+ 72,500
+ 
+$
+ 75,000
+ 
+$
+ 155,750
+
+John Ellis (4)
+ 
+$
+ 33,750
+ 
+$
+ 0
+ 
+$
+ 33,750
+
+Michael Harrison
+ 
+$
+ 62,000
+ 
+$
+ 75,000
+ 
+$
+ 137,000
+
+Stephen Lang (5) (6)
+ 
+$
+ 30,750
+ 
+$
+ 125,000
+ 
+$
+ 155,750
+
+David Naccarati (5)
+ 
+$
+ 32,000
+ 
+$
+ 125,000
+ 
+$
+ 157,000
+
+Thomas Weng (7)
+ 
+$
+ 62,500
+ 
+$
+ 75,000
+ 
+$
+ 137,500
+
+Marni Wieshofer
+ 
+$
+ 70,000
+ 
+$
+ 75,000
+ 
+$
+ 145,000
+
+(1)
+Amounts reflect the aggregate grant date fair value of the initial director equity grant of 13,514 restricted stock units ( RSUs ) and the 2021 annual director equity grant of 20,270 RSUs, each of which were granted on May 24, 2021, as computed in accordance with FASB ASC Topic 718, assuming no forfeitures. These amounts reflect the Company s accounting expense and do not correspond to the actual value that will be realized by the non-employee directors. The initial director equity grant vests in three equal installments on (i) the earlier of each of (A) the first annual meeting of stockholders of the Corporation during which the Director was serving as a member of the Board or (B) May 24, 2022, (ii) the date that is one year following the vesting date of the first tranche; and (iii) the date that is two years following the vesting date of the first tranche. The 2021 annual director equity grant vested 50% on the date of grant and 50% on the earlier of the date of the 2022 Annual Meeting of Stockholders or May 24, 2022. As Mr. Kirsch sat on our Board as a representative of Mudrick Capital Management, L.P., his director equity grants were assigned to and made to Mudrick Capital Management, L.P. rather than to Mr. Kirsch personally. As of December 31, 2021, each non-employee director had outstanding the following unvested RSUs: (a) 4,486 RSUs from the initial director equity grants and 10,135 RSUs from the 2021 annual director equity grant for each of Messrs. Harrison and Weng and Ms. Wieshofer were unvested and (b) 9,009 RSUs from the initial director equity grants and 10,135 RSUs from the 2021 annual director equity grants for each of Messrs. Naccarati and Lang were unvested.
+
+(2)
+Mr. Kirsch resigned from the Board effective November 9, 2021.
+
+(3)
+Mr. Davis resigned from the Board effective December 14, 2021.
+
+(4)
+Mr. Ellis resigned from the Board effective May 24, 2021.
+
+(5)
+Messrs. Lang and Naccarati were elected to the Board effective May 24, 2021.
+
+(6)
+Mr. Lang elected to defer conversion of the RSUs awarded for his initial director equity grant and 2021 annual director equity grant, to the extent they vest, until the date of his separation from service as a Board member.
+
+(7)
+Mr. Weng elected to defer conversion of the RSU awarded for his initial director equity grant and 2021 annual director equity grant, to the extent they vest, until the date of his separation from service as a Board member.
+
+ 
+
+-92-
+
+Table of Contents
+
+EXECUTIVE COMPENSATION
+As an emerging growth company, we have opted to comply with the executive compensation disclosure rules applicable to smaller reporting companies as such term is defined in the rules promulgated under the Securities Act. The following disclosure concerns the compensation arrangements of our current named executive officers for the fiscal years ended December 31, 2021 and 2020.
+Summary Compensation Table
+The following table sets forth the compensation for the services in all capacities to us or our subsidiary companies for the years ended December 31, 2021 and 2020 of (a) our current Chief Executive Officer, (b) our current Chief Financial Officer, and (c) the two most highly compensated executive officers, other than the Chief Executive Officer and Chief Financial Officer, as of December 31, 2021 or who served in that role during a portion of 2021.
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+Non-Equity
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+Incentive Plan
+ 
+All Other
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+Salary
+ 
+Bonus
+ 
+Stock Awards(2) 
+ 
+Compensation(3)
+ 
+Compensation(4)
+ 
+ 
+ 
+
+Name and Principal Position
+ 
+Year
+ 
+($)
+ 
+($)(1)
+ 
+($)
+ 
+($)
+ 
+ ($)
+ 
+Total ($)
+
+Diane R. Garrett, Ph.D.(5)
+ 
+2021
+ 
+$
+ 550,000
+ 
+$
+ 0
+ 
+$
+ 1,100,000
+ 
+$
+0
+ 
+$
+ 21,060
+ 
+$
+1,671,060
+
+ 
+ 
+2020
+ 
+$
+ 172,617
+ 
+$
+ 0
+ 
+$
+ 1,250,000
+ 
+$
+ 0
+ 
+$
+ 5,026
+ 
+$
+ 1,427,643
+
+President and CEO
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Stanton K. Rideout(6)
+ 
+2021
+ 
+$
+ 375,000
+ 
+$
+ 0
+ 
+$
+ 562,500
+ 
+$
+0
+2 
+$
+ 12,498
+ 
+$
+949,060
+
+ 
+ 
+2020
+ 
+$
+ 75,419
+ 
+$
+ 0
+ 
+$
+ 400,000
+ 
+$
+ 0
+ 
+$
+ 37,222
+ 
+$
+ 512,641
+
+Executive Vice President and Chief Financial Officer
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+John Henris (7)
+ 
+2021
+ 
+$
+ 325,694
+ 
+$
+ 0
+ 
+$
+ 775,000
+ 
+$
+ 0
+ 
+$
+ 40,734
+ 
+$
+ 1,141,428
+
+Executive Vice President and Chief Operating Officer
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+Jeffrey Stieber(8)
+ 
+2021
+ 
+ 
+ 215,306
+ 
+$
+ 0
+ 
+$
+ 230,000
+ 
+$
+ 0
+ 
+$
+ 15,011
+ 
+$
+ 460,317
+
+ 
+ 
+2020
+ 
+$
+ 215,417
+ 
+$
+ 100,000
+ 
+$
+ 102,500
+ 
+$
+ 24,600
+ 
+$
+ 52,508
+ 
+$
+ 495,025
+
+Senior Vice President, Finance and Treasurer;
+former Vice President and Interim Chief Financial Officer
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+(1)
+Amounts represent payments under Seller s retention bonus plan. The Company assumed the obligation to pay these amounts in connection with the Recapitalization Transaction.
+
+(2)
+Amounts reflect the aggregate grant date fair value of awards granted during the fiscal year noted as computed in accordance with FASB ASC Topic 718, assuming no forfeitures. These amounts reflect the Company s accounting expense and do not correspond to the actual value that may be realized by the Named Executive Officers.
+
+(3)
+Amounts reflect the cash payouts for 2019 performance paid in June 2020 following the consummation of the Recapitalization Transaction.
+
+(4)
+During 2021, All Other Compensation consisted of the following:
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+Moving
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+401(k)
+ 
+Life
+ 
+ 
+ 
+and
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+Matching
+ 
+Insurance
+ 
+Consulting
+ 
+Other
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+Contributions
+ 
+Premiums
+ 
+Payments
+ 
+Expenses
+ 
+Total
+
+Name
+ 
+Year
+ 
+($)
+ 
+($)
+ 
+($)
+ 
+($)
+ 
+($)
+
+Diane R. Garrett, Ph.D.
+ 
+2021
+ 
+$
+ 19,500
+ 
+$
+ 1,560
+ 
+ 
+ 
+$
+ 0
+ 
+$
+ 21,060
+
+ 
+ 
+2020
+ 
+$
+2,750
+ 
+$
+2,276
+ 
+ 
+ 
+$
+0
+ 
+$
+5,026
+
+Stanton K. Rideout
+ 
+2021
+ 
+$
+ 11,250
+ 
+$
+ 1,248
+ 
+$
+31,275
+(a) 
+$
+ 0
+ 
+$
+ 12,498
+
+ 
+ 
+2020
+ 
+$
+4,525
+ 
+$
+1,422
+ 
+ 
+ 
+$
+0
+ 
+$
+37,222
+
+John Henris
+ 
+2021
+ 
+$
+ 19,271
+ 
+$
+ 705
+ 
+ 
+ 
+$
+ 20,215
+ 
+$
+ 40,734
+
+Jeffrey Stieber
+ 
+2021
+ 
+$
+ 13,595
+ 
+$
+ 1,416
+ 
+ 
+ 
+$
+ 0
+ 
+$
+ 15,011
+
+ 
+ 
+2020
+ 
+$
+17,100
+ 
+$
+705
+ 
+ 
+ 
+$
+34,703
+(b) 
+$
+52,508
+
+(a)
+For consulting fees paid prior to Mr. Rideout s employment with the Company began.
+
+(b)
+Includes $19,167 of relocation allowance and $15,536 reimbursement for moving expenses incurred in 2020.
+
+(5)
+Ms. Garrett was hired effective September 8, 2020. Her base salary was set at $550,000.
+
+-93-
+
+Table of Contents
+
+(6)
+Mr. Rideout was hired effective October 20, 2020. His base salary was set at $375,000.
+
+(7)
+Mr. Henris was hired effective January 11 2021, His base salary was set at $350,000, Mr. Henris retired effective as of December 31, 2021.
+
+(8)
+Mr. Stieber was appointed as the Company s Vice President and Interim Chief Financial Officer on July 1, 2020 and, upon Mr. Rideout s appointment on October 20, 2020, Mr. Stieber was appointed as Senior Vice President, Finance and Treasurer. Mr. Stieber s employment by the Company ceased on December 7, 2021.
+
+2021 Outstanding Equity Awards at Fiscal Year-End Table
+The following table summarizes certain information for each NEO with respect to outstanding equity awards and the value of such awards as of December 31, 2021.
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+Stock Awards
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+Equity Incentive
+ 
+Equity Incentive
+
+ 
+ 
+ 
+ 
+Market Value
+ 
+Plan Awards:
+ 
+Plan Awards:
+
+ 
+ 
+Number of
+ 
+of Shares or
+ 
+Number of
+ 
+Market or Payout
+
+ 
+ 
+Shares or Units
+ 
+Units of Stock
+ 
+Unearned Shares,
+ 
+Value of Unearned
+
+ 
+ 
+of Stock that
+ 
+ that
+ 
+Units, or Other
+ 
+Shares, Units, or
+
+ 
+ 
+have not yet
+ 
+have not vested
+ 
+Rights That Have
+ 
+Other Rights That
+
+Name
+ 
+Vested (#)(1)
+ 
+($)(2)
+ 
+Not Vested (#) (3)
+ 
+Have Not Vested ($)
+
+Diane R. Garrett, Ph.D.
+ 
+ 23,427
+ 
+$
+ 14,384
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 154,494
+ 
+$
+ 94,859
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 96,154
+ 
+$
+ 59,039
+ 
+ 
+ 
+ 
+
+Stanton K. Rideout
+ 
+ 12,803
+ 
+$
+ 7,861
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 32,982
+ 
+$
+ 20,251
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 79,003
+ 
+$
+ 448,508
+ 
+ 
+ 
+ 
+
+John Henris(3)
+ 
+ 0
+ 
+$
+ 0
+ 
+ 
+ 
+ 
+
+Jeffrey Stieber(4)
+ 
+ 0
+ 
+$
+ 0
+ 
+ 
+ 
+ 
+
+(1)
+The vesting schedules for the time-based restricted stock units for each named executive officer is as follows:
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Name
+ 
+RSU Grant Amount
+ 
+Grant Date
+ 
+Vesting Schedule
+
+Diane R. Garrett, Ph.D.
+ 
+ 34,966
+ 
+12/15/2020
+ 
+See footnote (a)
+
+ 
+ 
+ 154,495
+ 
+03/02/2021
+ 
+See footnote (b)
+
+ 
+ 
+ 96,154
+ 
+9/8/2020
+ 
+100% of the grant will vest on September 8, 2024.
+
+Stanton K. Rideout
+ 
+ 19,109
+ 
+12/17/2020
+ 
+See footnote (a) 
+
+ 
+ 
+ 79,003
+ 
+03/02/2021
+ 
+See footnote (b)
+
+ 
+ 
+ 32,982
+ 
+10/20/2020
+ 
+100% of the grant will vest on October 20, 2024.
+
+John Henris
+ 
+ 73,736
+ 
+03/02/2021
+ 
+See footnotes (b) and (3)
+
+ 
+ 
+ 33,423
+ 
+1/11/2021
+ 
+100% of the grant will vest on January 11, 2025.
+
+Jeffrey Stieber
+ 
+ 55,647
+ 
+2/20/2019
+ 
+See footnote (c)
+
+ 
+ 
+ 14,336
+ 
+12/15/2020
+ 
+See footnotes (a) and (4)
+
+ 
+ 
+ 32,304
+ 
+03/02/2021
+ 
+See footnote (b) and (4)
+
+(a)
+Subject to the continued employment with the Company, the RSUs vest 33% for the first and second installment and 34% for the third installment with the first tranche vested on May 28, 2021; and the remaining tranches vesting on May 27, 2022 and May 29, 2023. Vested RSUs will convert into shares of Common Stock on each applicable vesting date, provided that, if on the conversion date, the holder is prohibited from trading under the Company s policies or pursuant to applicable securities laws, the conversion date will be, in the Compensation Committee s determination, the 2nd trading day after the date such prohibitions no longer apply.
+
+(b)
+Subject to the continued employment with the Company, the RSUs vest 33% for the first and second installment and 34% for the third installment with the first tranche vested on March 15, 2022; and the remaining tranches vesting on March 15, 2023 and March 15, 2024. Vested RSUs will convert into shares of Common Stock on each applicable vesting date; provided, however, that if, on that conversion date, the holder is prohibited from trading under the Company s policies or pursuant to applicable securities laws, the conversion date shall be, in the determination of the Board s Compensation Committee, the 2nd trading day after the date the reporting person is no longer prohibited from such trading.
+
+-94-
+
+Table of Contents
+
+(c)
+On February 20, 2019, $102,500 of RSUs were granted to Mr. Stieber. The number of shares of Common Stock that the grant will convert into was based upon the share price on each vesting date. Mr. Stieber s employment terminated on December 7, 2021 and all unvested RSUs were forfeited and cancelled upon termination of employment.
+
+(2)
+Amounts represent the value of outstanding RSU awards based on the closing price of our Common Stock on December 31, 2021 of $0.61 per share.
+
+(3)
+John Henris retired effective as of December 31, 2021. None of his equity awards satisfied vesting requirements and were forfeited and cancelled.
+
+(4)
+Jeffrey Stieber s employment terminated on December 7, 2021. All unvested RSUs were forfeited and cancelled upon termination of employment.
+
+Equity Award Grants to Executive Officers
+We adopted and approved the HYMC 2020 Performance and Incentive Pay Plan pursuant to which the Company issued equity awards to officers and directors.
+The long-term equity incentive awards granted in 2021 were in the form of RSUs, subject to the terms and conditions set forth in the written award agreements. Awards granted in 2021 in the form of time-based equity awards with vesting based upon continued employment.
+The initial long-term equity incentive award agreements included double trigger accelerated vesting in the event of a Change in Control.
+Employment Arrangements
+Common Defined Terms Used in the Employment Agreements
+For purposes of the employment agreements with our NEOs, the terms Cause , Change in Control , Disability , and Good Reason have the following definitions:
+The term Cause shall mean that one or more of the following has occurred:
+(i)
+the NEO is convicted of a felony or pleads guilty or nolo contendere to a felony (whether or not with respect to the Company or any of its affiliates);
+
+(ii)
+a failure of the NEO to substantially perform his or her responsibilities and duties to the Company which, to the extent curable, is not remedied within 10 days after the NEO s receipt of written notice given by the appropriate senior officer or any member of the Board, as applicable, identifying the failure in reasonable detail and granting the NEO an opportunity to cure such failure within such 10 day period;
+
+(iii)
+the failure of the NEO to carry out or comply with any lawful and reasonable directive of the Board (or any committee of the Board), which, to the extent curable, is not remedied within 10 days after the NEO s receipt of written notice given by or on behalf of the Company identifying the failure in reasonable detail and granting the NEO an opportunity to cure such failure within such 10 day period;
+
+(iv)
+the NEO engages in illegal conduct, any breach of fiduciary duty (if any), any act of material dishonesty or other misconduct, in each case in this clause (iv), against the Company or any of its affiliates;
+
+(v)
+a material violation or willful breach by the NEO of any of the policies or procedures of the Company, including, without any limitation, any employee manual, handbook or code of conduct of the Company which, to the extent curable, is not remedied within 10 days after the NEO s receipt of written notice given by or on behalf of the Company identifying the violation or breach in reasonable detail and granting the Executive an opportunity to cure such violation or breach within such 10 day period;
+
+(vi)
+the NEO fails to meet any material obligation the NEO may have under any agreement entered into with the Company which, to the extent curable, is not remedied within 10 days after the NEO s receipt of written notice 
+
+-95-
+
+Table of Contents
+
+given by any member of the Company identifying the failure in reasonable detail and granting the NEO an opportunity to cure such failure within such 10 day period;
+(vii)
+the NEO s failure to maintain any applicable license, permit or card required by the federal or state authorities or a political subdivision or agency thereof (or the suspension, revocation or denial of such license, permit or card); or
+
+(viii)
+the NEO s breach of any non-compete, non-solicit, confidentiality or other restrictive covenant to which the NEO may be subject, pursuant to an employment agreement or otherwise.
+
+The term a Change in Control of the Company will be deemed to occur as of the first day that one or more of the following conditions is satisfied:
+(i)
+The beneficial ownership (as defined in Rule 13d-3 under the Exchange Act) of securities representing more than 50% of the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors ( Company Voting Securities ), is accumulated, held or acquired by a Person (as defined in Section 3(a)(9) of the Exchange Act, as modified and used in Sections 13(d) and 14(d) thereof) (other than the Company, any trustee or other fiduciary holding securities under an employee benefit plan of the Company, holders of capital stock of the Company as of the date hereof or a subsidiary thereof, any corporation owned, directly or indirectly, by the Company s stockholders in substantially the same proportions as their ownership of stock of the Company); provided, however, that any acquisition from the Company or any acquisition pursuant to a transaction that complies with clauses (A), (B) and (C) of clause (iii) below will not be a Change in Control; provided further, that immediately prior to such accumulation, holding or acquisition, such Person was not a direct or indirect beneficial owner of 15% or more of Company Voting Securities as of the date of the applicable employment agreement; or
+
+(ii)
+Individuals who, as of the date of the Agreement, constitute the Board, or Incumbent Board , cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board will be considered as though such individual were a member of the Incumbent Board; or
+
+(iii)
+Consummation by the Company of a reorganization, merger or consolidation, or sale or other disposition of all or substantially all of the assets of the Company or the acquisition of assets or stock of another entity, or Business Combination , in each case, unless immediately following such Business Combination: (A) more than 50% of the combined voting power of then outstanding voting securities entitled to vote generally in the election of directors of (x) the corporation resulting from such Business Combination, or Surviving Corporation , or (y) if applicable, a corporation that as a result of such transaction owns the Company or all or substantially all of the Company s assets either directly or through one or more subsidiaries, or Parent Corporation , is represented, directly or indirectly by Company Voting Securities outstanding immediately prior to such Business Combination (or, if applicable, is represented by shares into which such Company Voting Securities were converted pursuant to such Business Combination), and such voting power among the holders thereof is in substantially the same proportions as their ownership, immediately prior to such Business Combination, of Company Voting Securities; (B) no Person (excluding any employee benefit plan (or related trust) of the Company or such corporation resulting from such Business Combination) beneficially owns, directly or indirectly, 40% or more of the combined voting power of the then outstanding voting securities eligible to elect directors of the Parent Corporation (or, if there is no Parent Corporation, the Surviving Corporation) except to the extent that (x) such ownership of the Company existed prior to the Business Combination or (y) that immediately prior to such Business Combination, such Person was a direct or indirect beneficial owner of 15% or more of the Company Voting Securities as of the date of the respective employment agreement, and (C) at least a majority of the members of the board of directors of the Parent Corporation (or, if there is no Parent Corporation, the Surviving Corporation) were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination.
+
+-96-
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+Table of Contents
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+Notwithstanding anything to the contrary in the foregoing, in no event will a Change in Control be deemed to have occurred with respect to the NEO if the NEO is part of a purchasing group that consummates the Change in Control transaction. The NEO will be deemed part of a purchasing group for purposes of the preceding sentence if the NEO is an equity participant in the purchasing company or group (except (i) passive ownership of less than two percent of the stock of the purchasing company; or (ii) ownership of equity participation in the purchasing company or group that is otherwise not significant, as determined prior to the Change in Control by a majority of the nonemployee continuing directors.
+The term Disability means the NEO s long-term disability as defined by and determined under the Company s long-term disability plan, or if the NEO is not covered by a long-term disability plan sponsored by the Company, then the NEO s inability (as determined by the Board or compensation committee thereof in its discretion, (in the case of Dr. Garrett and Mr. Rideout, with the Board or Compensation Committee acting reasonably)) to engage in any substantial gainful activity by reason of any medically-determined physical or mental impairment that can be expected to result in death or to be of long-continued and indefinite duration.
+The term Good Reason means the occurrence of any of the following without the NEO s consent:
+(i)
+a material reduction or a material adverse alteration in the nature of the NEO s position, responsibilities or authorities or the assigning of duties to the NEO that are materially inconsistent with those of the position of such NEO of a company of comparable size in a comparable industry;
+
+(ii)
+the NEO s becoming the holder of a lesser office or title than that previously held;
+
+(iii)
+any material breach of the applicable employment agreement by the Company that causes an adverse change to the terms and conditions of the NEO s employment;
+
+(iv)
+the Company requires the NEO to relocate his principal business office to a location not within 75 miles of the applicable Company location;
+
+(v)
+any reduction in the NEO s salary, other than a reduction in salary generally applicable to executive employees; or
+
+(vi)
+failure of the Company to pay the NEO any amount otherwise vested and due under the applicable employment agreement or under any plan or policy of the Company following written notice by the NEO to the Company identifying the failure and the basis for such payment and the Company s failure to cure within 10 days following receipt of such written notice.
+
+In no event will a resignation be deemed to occur for Good Reason unless the NEO provides notice to the Company, and such resignation occurs, within 90 days after the event or condition giving rise thereto. Upon receiving notice from the NEO, the Company shall have a period of 30 days during which it may remedy the event or condition.
+Employment Agreement with Diane R. Garrett
+The Company entered into an employment agreement dated as of August 31, 2020 (the Garrett Employment Agreement ) with Diane R. Garrett, Ph.D., which provides for a three-year term as President and Chief Executive Officer, following which she shall be deemed to be an at-will employee during the continuation of her employment by the Company. Under the terms of the Garrett Employment Agreement, Ms. Garrett is entitled to an annual base salary of $550,000, an annual cash incentive bonus initially set at 70% of her annual base salary as target, and an initial long-term equity incentive award having a value of $1,000,000. The initial long-term equity incentive was granted on the effective date of her employment, September 8, 2020, in the form of 96,154 RSUs, which was determined by dividing $1,000,000 by $10.40, the closing price of the Common Stock on the date of grant. Such RSUs will vest on the fourth anniversary of the date of grant, subject to Ms. Garrett s continued employment by the Company through the vesting date and subject to any provisions of the grant relating to retirement, disability, change of control and other matters. Ms. Garrett will also be eligible to participate in equity-based compensation plans, initially targeted at 200% of her base salary, with 50% of such awards initially in the form of performance-based equity awards and 50% of such awards initially in the form of time-based equity awards.
+
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+As required under the terms of the Garrett Employment Agreement, on December 15, 2020, the Company offered Ms. Garrett $550,000 worth of time-based RSUs. However, Ms. Garrett did not accept her full time-based equity award and requested that a portion of those time-based RSUs be re-allocated and granted to other employees rather than herself. As a result, on December 15, 2020, Ms. Garrett accepted $250,000 in value in the amount of 34,966 RSUs, based upon the fair market value of the Company s Common Stock on the date of grant, rather than the 76,924 RSUs she would have been eligible to receive. Ms. Garrett s RSUs will vest, subject to continued employment, in three equal installments on each of May 28, 2021, May 27, 2022 and May 29, 2023. The Company did not issue any performance-based equity awards in 2020. On March 2, 2021, the Company issued 154,495 time-based RSUs to Ms. Garrett.
+Employment Agreement with Stanton K. Rideout
+The Company entered into an employment agreement dated as of October 20, 2020 (the Rideout Employment Agreement ) with Mr. Rideout, which provides for a three-year term as Executive Vice President and Chief Financial Officer, following which he shall be deemed to be an at-will employee during the continuation of his employment by the Company. Under the terms of the Rideout Employment Agreement, Mr. Rideout is entitled to an annual base salary of $375,000, an annual cash incentive bonus target initially set at 60% of his annual base salary and an initial long-term equity award having a value of $250,000.
+The initial long-term equity incentive was granted on the effective date of his employment, October 20, 2020, in the form of 32,982 RSUs, with the number of RSUs determined by dividing $250,000 by the closing stock price of the Company s Common Stock on the date of grant. Such RSUs will vest on the fourth anniversary of the grant date, subject to Mr. Rideout s continued employment by the Company through the vesting date and subject to any provisions of the grant relating to retirement, disability, change of control and other matters. Mr. Rideout will also be eligible to participate in equity-based compensation plans commencing in 2021, initially targeted at 150% of his base salary, with 50% of such awards initially in the form of performance-based equity awards and 50% of such awards in the form of time-based equity awards.
+On December 17, 2020, the Company awarded Mr. Rideout a portion of the re-allocated RSUs (described above under Employment Agreement with Diane R. Garrett ) equal to $150,000 in value in the amount of 19,109 RSUs, based on the fair market value of the Company s Common Stock on the date of grant, in recognition of his contributions to the Company and to incentivize his future performance. Mr. Rideout s RSUs have the same vesting schedule as Ms. Garrett s that were granted on December 15, 2020. On March 2, 2021, the Company issued 79,003 time-based RSUs to Mr. Rideout.
+Employment Agreement with Jeffrey Stieber
+Hycroft Mining Corporation entered into an employment agreement dated as of March 25, 2019 with Mr. Stieber (the Stieber Employment Agreement ). Mr. Stieber became an executive officer in July 2020 upon his appointment as our Vice President and Interim Chief Financial Officer. On October 20, 2020, upon Mr. Rideout s assuming the position of Executive Vice President and Chief Financial Officer, Jeffrey Stieber ceased to serve as the Company s Vice President and Interim Chief Financial Officer and, instead, became our Senior Vice President of Finance and Treasurer, reporting to Mr. Rideout. At that time, Mr. Stieber remained an executive officer of the Company and his employment agreement continued unchanged.
+The Stieber Employment Agreement provided for a three-year term following which he shall be deemed to be an at-will employee during the continuation of his employment by the Company. Under the terms of the Stieber Employment Agreement, Mr. Stieber was entitled to an annual base salary of $205,000 (subsequently increased to $230,000), an annual cash incentive bonus target initially set at 40% of his annual base salary and an initial long-term equity award, which he received on February 20, 2019, targeted at 100% of his base salary with 50% of such awards initially in the form of performance-based RSUs and 50% of such initial awards initially in the form of time-based RSUs. The Stieber Employment Agreement and equity awards issued to Mr. Stieber by Hycroft Mining Corporation were assumed by the Company .
+Effective as of August 1, 2020, Mr. Stieber s annual base salary was increased by $25,000. On December 15, 2020, the Company granted Mr. Stieber 14,336 time-based RSUs. On March 2, 2021, the Company issued 32,304 time-based RSUs to Mr. Stieber.
+Mr. Stieber s notified the Company of his resignation on November 19, 2021 and his employment was voluntarily ceased on December 7, 2021. No severance amounts were payable under the Stieber Employment Agreement and all unvested RSUs were forfeited and cancelled.
+
+-98-
+
+Table of Contents
+
+Employment Agreement with John Henris
+Hycroft Mining Corporation entered into an employment agreement dated as of January 11, 2021 with Mr. Henris (the Henris Employment Agreement ). Mr. Henris became an executive officer his commencement of employment as our Executive Vice President Operations.
+The Henris Employment Agreement provided for a three-year term following which he shall be deemed to be an at-will employee during the continuation of his employment by the Company. Under the terms of the Henris Employment Agreement, Mr. Henris was entitled to an annual base salary of $350,000, an annual cash incentive bonus target initially set at 60% of his annual base salary and an initial long-term equity award targeted at 150% of his base salary with the form of such equity awards to be determined by the Compensation Committee for senior officers.
+On January 11, 2021, the Company granted Mr. Henris 33,423 time-based RSUs vesting four years following the grant date. On March 2, 2021, the Company issued 73,736 time-based RSUs to Mr. Henris vesting pro rata over a three year period based upon continued employment by the Company.
+Mr. Henris retired from the Company effective on December 31, 2021. No severance amounts were payable under the Henris Employment Agreement and all unvested RSUs were forfeited and cancelled.
+Termination Payment Terms Applicable to the Employment Agreements of the NEOs Who Remain Currently Employed with Us
+Each of the employment agreements with our current NEOs, Ms. Garrett and Mr. Rideout contain provisions which entitle them to payments following termination of their employment in certain circumstances, as described below.
+Termination of Employment for any Reason
+Pursuant to the current employment agreements with Ms. Garrett and Mr. Rideout, in the event their employment with the Company is terminated for any lawful reason or no reason, they (or their estate, as applicable) will be entitled to receive any earned but unpaid base salary, any earned but unpaid annual cash incentive bonus, any amounts that may be payable under any applicable executive benefit plan, expense reimbursements and COBRA benefits provided that a timely election for COBRA continuation coverage is made and the applicable amounts are paid.
+Termination of Employment other than for Cause or Voluntary Termination by Executive for Good Reason
+In the event that the Company terminates any of Ms. Garrett or Mr. Rideout without Cause or either of them terminates their employment for Good Reason, they would be entitled to (i) a cash amount equal to 1.5 multiplied by their annual base salary, payable in equal installments over the 18 month period following the date of termination, (ii) 18 months of continued coverage under the Company s medical, dental, life and disability plans, at the same cost to the individual as in effect on the date of termination, and (iii) outplacement services until the earlier of (A) $15,000 in the aggregate having been paid by the Company to the outplacement firm or (B) 12 months following the date of termination.
+Termination of Employment in the Event of Death or Disability
+In the event that the employment of any of Ms. Garrett or Mr. Rideout with the Company is terminated due to her or his death or Disability, she or he (or their estate, as applicable) will be entitled to receive the pro rata portion of any bonus payable to them under the Company s annual cash incentive plan for the year in which such termination for death or Disability occurs determined based on the actual bonus attained for the fiscal year in which such termination occurs.
+Termination of Employment after a Change in Control
+If within 90 days prior to, or one year after, a Change in Control, the Company terminates the employment of any of Ms. Garrett or Mr. Rideout for reasons other than for Cause, any of them incurs a Disability or any of them voluntarily terminates his or her employment for Good Reason, such NEO will be entitled to (i) a cash amount equal to 2.0 multiplied by his or her annual base salary, payable in a lump sum on the 60th day following the date of termination, (ii) a cash amount equal to 2.0 multiplied by the greater of 
+
+-99-
+
+Table of Contents
+
+(A) the actual bonus paid for the fiscal year immediately preceding the date of termination, (B) the actual bonus attained for the fiscal year in which the date of termination occurs prior to the first anniversary of the employment agreement, or (C) the target bonus for the fiscal year in which the date of termination occurs prior to the first anniversary of the agreement, payable in a lump sum on the 60th day following the date of termination, (iii) 24 months of continued coverage under the Company s medical, dental, life and disability plans, at the same cost to the individual as in effect on the date of the Change in Control (or, if lower, as in effect at any time thereafter) and (iv) outplacement services until the earlier of (A) $15,000 in the aggregate having been paid by the Company to the outplacement firm or (B) 12 months following the date of termination.
+Compensation Philosophy and Objectives
+Our compensation policies and philosophies are designed to align compensation with our business objectives and the creation of stockholder value, while enabling us to attract, motivate and retain individuals who contribute to the long-term success of the Company.
+The Compensation Committee believes that the executive compensation program must be competitive in order to attract and retain our executive officers. The Compensation Committee has implemented compensation policies and philosophies that link a significant portion of our executive officers cash compensation to performance objectives and by providing a portion of their compensation as long-term incentive compensation in the form of equity awards.
+Our annual compensation review is undertaken at the direction and under the supervision of the Compensation Committee. Other than our Chief Executive Officer, no executive officers are involved in making recommendations for executive officer compensation, and no executive officer makes any recommendations for their own compensation. Additionally, no executive officers are involved in determining director compensation. At its sole discretion, the Compensation Committee may engage independent compensation consultants on an exclusive basis to advise the Compensation Committee on executive officer and director compensation matters. In 2021, the Compensation Committee engaged Semler Brossy to provide independent advice on executive officer and director compensation matters. Following the review process, the Compensation Committee discusses the review process and compensation determinations with the non-management members of the Board, and approves the annual base salaries, equity award grants, incentive cash award targets and financial metrics for the upcoming year and incentive cash awards for the prior year for the named executive officers.
+Generally, in the first quarter of each year, the Compensation Committee reviews management s recommendations and historical pay and performance information. The Compensation Committee s review includes approval of the value of equity award grants. It is generally the Compensation Committee s policy to authorize and grant equity awards as of the date of the Board of Directors meeting (typically in March) at which such awards are ratified by the non-management members of the Board of Directors upon the recommendation of the Compensation Committee, based upon the closing price of our Common Stock on the date of the award. Due, however, to the critical efforts to obtain financing and the significant financing transactions that the Company was engaged in during the first quarter of 2022, the Compensation Committee delayed its review of executive officer compensation matters and will perform such review in the second quarter of 2022.
+The Compensation Committee does not have a specific policy or practice to time equity awards to the release of earnings or other material non-public information. However, the Compensation Committee may determine the value of an equity award but not issue or establish the number of shares or share units while in possession of material non-public information, such as a material pending transaction. Our practice is not to accelerate or delay the disclosure of material non-public information, whether favorable or unfavorable, but to make such disclosures when appropriate or required by applicable securities laws. In order not to unduly benefit or harm officers and employees we would consider postponing the issuance of awards until after the material non-public information has been publicly disclosed or is no longer considered to be material information.
+Periodically throughout the year, the Compensation Committee may discuss, as appropriate, the philosophy for the overall compensation program, and decide whether changes should be made in particular program components or whether special awards are appropriate or desirable during the current year or for future periods.
+Compensation for our executive officers will have three primary components: base salary, an annual cash incentive bonus and long-term equity-based incentive compensation.
+
+-100-
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+Base Salary
+Base Salaries are set to be fair to the executive officers, competitive within the industry and reasonable in light of our cost structure. The Compensation Committee will determine base salaries, subject to the terms of any employment agreements, and will review base salaries annually based upon advice and counsel from its advisors. With the raising of gross proceeds of approximately $194 million before deduction of commissions, fees and expenses, in late March, 2022, the Compensation Committee reviewed annual base salaries for executive officers for 2022 in the second quarter of 2022 and acknowledging the efforts of Ms. Garrett and Mr. Rideout in managing the Company, issuing a new initial assessment technical report, extending the maturity and restructuring certain payment terms of the Company s outstanding indebtedness and raising substantial equity capital to address the Company s going concern and critical liquidity issues, determined to increase the annual base salary of Ms. Garrett by $50,000 to $600,000 per year and to increase the annual base salary of Mr. Rideout by $50,000 from $375,000 to $425,000, each effective as of April 1, 2022.
+Annual Cash Incentive Bonuses
+In 2021, the Compensation Committee used annual cash incentive bonuses for the NEOs to tie a portion of the NEOs compensation to financial and operational objectives achievable within the applicable fiscal year, such as (i) gold and gold equivalent production/sales, (ii) total cash costs of production per gold or gold equivalent ounce, (iii) health and safety, and/or (iv) such other metrics as are determined from time to time by the Board. The Compensation Committee at the beginning of each year will select the performance targets, target amounts, target award opportunities and other term and conditions of annual cash bonuses for the NEOs. Following the end of each year, the Compensation Committee will determine the extent to which the performance targets were achieved and the amount of the award that is payable to the NEOs. In 2021, prior to the Private Placement and ATM Program, the Company did not have sufficient cash to pay its performance awards with its going concern and debt covenant compliance issues. With the raising of gross proceeds of approximately $194 million before deduction of commissions, fees and expenses, in April 2022, the Compensation will review incentive compensation matters in the second quarter of 2022.
+Equity-Based Awards
+The Compensation Committee will use equity-based awards to reward long-term performance of the NEOs under the Incentive Plan. Providing a meaningful portion of the total compensation package in the form of equity-based awards is an essential element to compensation arrangements to align the incentives of its officers, including its NEOs, with the interests of its stockholders and serve to motivate and retain the individual NEOs. Following approval by the Stockholders of additional shares of Common Stock to be issued under the Incentive Plan, the Compensation will review equity-based incentive compensation matters in the second quarter of 2022.
+Executive Agreements
+The Company has entered into compensation arrangements with its officers, including employment agreements and equity award agreements as part of its policy to pay and compensate key executives as appropriate to attract, retain and compensate executive talent.
+Other Compensation
+We have maintained the various employee benefit plans, including medical, dental, life insurance and 401(k) plans, offered by Seller in which the NEOs participate.
+Deductibility of Executive Compensation
+Section 162(m) of the Internal Revenue Code denies a federal income tax deduction for certain compensation in excess of $1.0 million per year paid to certain current and former executive officers of a publicly traded corporation.
+ 
+
+-101-
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+Table of Contents
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+CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
+Related Party Transactions relating to the Company
+Please see the section titled -
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+SUMMARY OF THE PROSPECTUS
+This summary highlights selected information included in this prospectus and does not contain all of the information that may be important to you in making an investment decision. This summary is qualified in its entirety by the more detailed information included in this prospectus. Before making your investment decision with respect to our securities, you should carefully read this entire prospectus, including the information under Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations and the financial statements included elsewhere in this prospectus.
+The Company
+We are an innovative digital health business with a mission to provide affordable and accessible imaging, monitoring and magnetic resonance imaging ( MRI ) guided interventions to revolutionize healthcare for people around the world. Our Swoop Portable Magnetic Resonance ( MR ) Imaging SystemTM ( Swoop ) produces high-quality images at a lower magnetic field strength that can be used by healthcare professionals to make effective clinical diagnoses on a patient in a variety of settings where MRI devices have previously been inaccessible. The easy-to-use interface and portable design of our Swoop system make it accessible for use anywhere in a hospital, clinic or patient care site. We are working to realize the vision of providing affordable and accessible imaging of health conditions around the world.
+Background and Business Combination
+The Company was originally known as HealthCor Catalio Acquisition Corp. ( HealthCor ). On December 21, 2021, HealthCor changed its jurisdiction of incorporation from the Cayman Islands to the State of Delaware (the Domestication ) by deregistering as an exempted company in the Cayman Islands and continuing and domesticating as a corporation incorporated under the laws of the State of Delaware. On December 22, 2021, we, after domesticating as a Delaware corporation on December 21, 2021, consummated a business combination (the Business Combination ) pursuant to the terms of the business combination agreement dated as of July 7, 2021 (the Business Combination Agreement ) by and among HealthCor, Optimus Merger Sub I, Inc., a Delaware corporation and wholly owned subsidiary of HealthCor ( Merger Sub I ), Optimus Merger Sub II, Inc., a Delaware corporation and wholly owned subsidiary of HealthCor ( Merger Sub II ), Hyperfine, Inc., a Delaware corporation ( Legacy Hyperfine ), and Liminal Sciences, Inc., a Delaware corporation ( Liminal ). In connection with the Business Combination, HealthCor changed its name to Hyperfine, Inc. , Legacy Hyperfine changed its name to Hyperfine Operations, Inc. and Liminal changed its name to Liminal Operations, Inc. 
+As a consequence of the Domestication, and in accordance with the terms of the Business Combination Agreement, each Class A ordinary share of HealthCor that was issued and outstanding as of immediately prior to the Domestication was converted, on a one-for-one basis, into a share of HealthCor s Class A common stock, and each Class B ordinary share of HealthCor that was issued and outstanding as of immediately prior to the Domestication was converted, on a one-for-one basis, into a share of the HealthCor s Class B common stock, and immediately prior to the Effective Time, each such share of HealthCor s Class B common stock was converted, on a one-for-one basis, into a share of the Company s Class A common stock (the Conversion ).
+As a consequence of the Business Combination, at the Effective Time, (i) each share of Legacy Hyperfine capital stock (other than shares of Legacy Hyperfine Series A preferred stock) that was issued and outstanding as of immediately prior to the Effective Time was automatically cancelled and extinguished and converted into the right to receive a number of shares of the Company s Class A common stock equal to 0.3275 (the Hyperfine Exchange Ratio ), rounded down to the nearest whole number of shares; (ii) each share of Legacy Hyperfine Series A preferred stock that was issued and outstanding as of immediately prior to the Effective Time was automatically cancelled and extinguished and converted into the right to receive a number of shares of the Company s Class B common stock equal to the Hyperfine Exchange Ratio, rounded down to the nearest whole number of shares; (iii) each share of Liminal capital stock (other than shares of Liminal Series A-1 preferred stock) that was issued and outstanding as of immediately prior to the Effective Time was automatically cancelled and extinguished and converted into the right to receive a number of shares of the Company s Class A common stock equal to 0.1796 (the Liminal Exchange Ratio ), rounded down to the nearest whole number of shares; (iv) each share of Liminal Series A-1 preferred stock that was issued and outstanding as of immediately prior to the Effective Time was automatically cancelled and extinguished and converted into the right to receive a number of shares of the Company s Class B common stock equal to the Liminal Exchange Ratio, rounded down to the nearest whole number of shares; (v) each option to purchase shares of Legacy Hyperfine common stock and each option to purchase shares of Liminal common stock, whether vested or unvested, that was outstanding and unexercised as of immediately prior to the Effective Time was assumed by the Company and became an option (vested or unvested, as applicable) to purchase a number of shares of the Company s Class A common stock equal 
+
+6
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+to the number of shares of Legacy Hyperfine common stock or Liminal common stock subject to such option immediately prior to the Effective Time multiplied by the Hyperfine Exchange Ratio or the Liminal Exchange Ratio, as applicable, rounded down to the nearest whole number of shares, at an exercise price per share equal to the exercise price per share of such option immediately prior to the Effective Time divided by the Hyperfine Exchange Ratio or the Liminal Exchange Ratio, as applicable, rounded up to the nearest whole cent; and (vi) each Legacy Hyperfine restricted stock unit and each Liminal restricted stock unit outstanding immediately prior to the Effective Time was assumed by the Company and became a restricted stock unit with respect to a number of shares of the Company s Class A common stock equal to the number of shares of Legacy Hyperfine common stock or Liminal common stock subject to such Legacy Hyperfine restricted stock unit or Liminal restricted stock unit immediately prior to the Effective Time multiplied by the Hyperfine Exchange Ratio or the Liminal Exchange Ratio, as applicable, rounded down to the nearest whole share.
+In addition, pursuant to the Business Combination Agreement, the Company will issue to holders of Legacy Hyperfine and Liminal securities as of immediately prior to the Effective Time, in accordance with their pro rata share, up to 10,000,000 shares of Class A common stock as earn-out consideration (the Earn-Out Shares ), if at any time during the period between the Closing Date and the third anniversary of the Closing Date (the Earn-Out Period ), (i) the last share price of the Class A common stock is greater than or equal to $15.00 for any 20 trading days within any 30 consecutive trading day period, or (ii) there is a transaction that will result in shares of Class A common stock being converted or exchanged into the right to receive cash or other consideration having a value greater than or equal to $15.00. During the Earn-Out Period, if there is a transaction (other than for stock splits, stock dividends, special cash dividends, reorganizations, recapitalizations or similar transactions affecting the Class A common stock) that will result in the shares of Class A common stock being converted or exchanged into the right to receive cash or other consideration having a value less than $15.00, then the right to receive Earn-Out Shares will terminate.
+In addition, concurrently with the execution of the Business Combination Agreement, on July 7, 2021, HealthCor entered into subscription agreements (the Subscription Agreements ) with certain institutional investors and accredited investors (the PIPE Investors ), pursuant to which the PIPE Investors purchased, immediately prior to the Closing, an aggregate of 12,610,000 shares of HealthCor Class A ordinary shares at a purchase price of $10.00 per share (the PIPE Investment ).
+Additionally, on December 22, 2021, the Company, HC Sponsor LLC (the Sponsor ), Legacy Hyperfine and Liminal entered into a Forfeiture Agreement (the Forfeiture Agreement ), pursuant to which, immediately prior to the Closing, 150,000 shares of HealthCor s Class B common stock held by the Sponsor were irrevocably forfeited and automatically cancelled (the Forfeiture ).
+Stock Exchange Listing
+Hyperfine Class A common stock is listed for trading on Nasdaq under the symbol HYPR .
+Summary of Risk Factors
+Investing in our securities involves risks. You should carefully consider the risks described in Risk Factors beginning on page 12 before making a decision to invest in our securities. If any of these risks actually occurs, our business, financial condition and results of operations would likely be materially adversely affected. Some of the risks related our business and industry are summarized below.
+ We are an early stage life sciences company, have a limited operating history on which to assess the prospects for our business, have generated limited revenue from sales of our products, and have incurred losses since inception. We anticipate that we will continue to incur significant losses for at least the next several years as we continue to commercialize our existing products and services and seek to develop and commercialize new products and services. We may not be able to generate meaningful revenues or achieve and sustain profitability in the future.
+ We may need to raise additional funding to expand the commercialization of our products and services, commercialize our future products and services, and expand our research and development efforts. This additional financing may not be available on acceptable terms, or at all. Failure to obtain this necessary capital when needed may force us to delay, limit or terminate our product commercialization or development efforts or other operations.
+ Our success depends upon market acceptance of our products and services, our ability to develop and commercialize existing and new products and services and generate revenues, and our ability to identify new applications for our technology.
+
+7
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+ Medical device development is costly and involves continual technological change, which may render our current or future products obsolete.
+ If we do not successfully manage the development and launch of new products, we will not meet our long-term forecasts and our business, financial condition, results of operations and prospects could be adversely affected.
+ We expect to generate a substantial portion of our revenue internationally in the future and may become subject to various additional risks relating to our international activities, which could adversely affect our business, financial condition, results of operations and prospects.
+ We have limited experience in marketing and selling our products and services, and we are unable to successfully commercialize our products and related services, our business, financial condition, results of operations and prospects will be adversely affected.
+ Because we are a controlled company within the meaning of the Nasdaq rules, our stockholders may not have certain corporate governance protections that are available to stockholders of companies that are not controlled companies.
+ The dual class structure of our common stock concentrates voting power with Jonathan M. Rothberg, Ph.D., a director of the Company and the founder of Legacy Hyperfine and Liminal, which limits an investor s ability to influence the outcome of important transactions, including a change in control.
+ If we do not successfully optimize and operate our sales and distribution channels or do not effectively expand and update our infrastructure, our operating results and customer experience may be negatively impacted.
+ The market for our products and services is new, rapidly evolving, and increasingly competitive, as the healthcare industry in the United States is undergoing significant structural change, which makes it difficult to forecast demand for our products and services.
+ Quality problems could lead to recalls or safety alerts and/or reputational harm and could have a material adverse effect on our business, financial condition, results of operations and prospects.
+ We depend on our key personnel and other highly qualified personnel and will need to expand our organization. If we are unable to recruit, train and retain our personnel, needed additional employees and consultants, our operations could be disrupted and we may not achieve our goals.
+ The size of the markets for our products may be smaller than estimated and new market opportunities may not develop as quickly as we expect, or at all, limiting our ability to successfully commercialize our products.
+ We have limited experience producing and supplying our products, and we may be unable to consistently manufacture or source our products to the necessary specifications or in quantities necessary to meet demand on a timely basis and at acceptable performance and cost levels.
+ We rely on a small number of contract manufacturers to manufacture and supply our products. If these manufacturers should fail or not perform satisfactorily, our ability to commercialize and supply our products would be adversely affected.
+ If we do not successfully develop and deploy our software, our commercialization efforts, business, financial condition, results of operations and prospects could suffer.
+ The life sciences technology market is highly competitive. If we fail to compete effectively, our business and results of operation will suffer.
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+ The COVID-19 pandemic has and may continue to negatively affect various aspects of our business and operations, including making it more difficult for us to develop and commercialize our products, which could have a material adverse effect on our business, financial condition, results of operations and prospects.
+ We have identified a material weakness in our internal control over financial reporting. Legacy Hyperfine and Liminal outsourced its accounting and financial reporting to 4Catalyzer as of and during the nine months ended September 30, 2021 and the years ended December 31, 2020 and 2019, and did not have its own finance professionals reviewing the information received from 4Catalyzer. The material weakness remained unremediated as of September 30, 2021. We have taken steps to enhance our internal control environment, including hiring a new Chief Financial Officer who joined us in August 2021, and is currently recruiting additional finance personnel. In addition, HealthCor identified a material weakness in its internal control over financial reporting as of September 30, 2021 in connection with its misclassification of the Class A ordinary shares subject to redemption in permanent equity.
+ We are subject to extensive government regulation in the United States and in other countries, which could restrict the development, marketing, sale and distribution of our products and could cause us to incur significant costs.
+ We may not be able to obtain or maintain regulatory clearances or approval for our products, and there may be restrictions and limitations on any approved product. Failure to obtain necessary clearances or approvals for our products would adversely affect our ability to grow our business.
+ We may be unable to identify, in-license or acquire additional technology that may be necessary for our business.
+ If we are unable to obtain and maintain and enforce sufficient intellectual property protection for our products and technology, or if the scope of the intellectual property protection obtained is not sufficiently broad, our competitors could develop and commercialize products similar or identical to ours, and our ability to successfully commercialize our products may be impaired.
+ We may not be able to protect our intellectual property rights throughout the world.
+ If we or any of our partners are sued for infringing the intellectual property rights of third parties, such litigation would be costly and time consuming, and an unfavorable outcome in any such litigation could have a material adverse effect on our business.
+ We face the risk of product liability claims and may be subject to damages, fines, penalties and injunctions, among other things.
+ We may be unable to obtain or maintain the listing of our Class A common stock on Nasdaq.
+ We may be unable to recognize the anticipated benefits of the Business Combination, which may be affected by, among other things, competition and our ability to grow and manage growth profitably and retain our key employees.
+
+Corporate Information
+HealthCor was incorporated as a Cayman Islands exempted company on November 18, 2020 for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or other similar business combination with one or more businesses.
+Legacy Hyperfine was incorporated under the laws of the State of Delaware on February 25, 2014 under the name Hyperfine Research, Inc. On May 25, 2021, the name of the corporation was changed to Hyperfine, Inc. 
+Liminal was incorporated under the laws of the State of Delaware on September 21, 2018 under the name EpilepsyCo Inc. On July 20, 2020, the name of the corporation was changed to Liminal Sciences, Inc. 
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+On December 22, 2021, HealthCor, Legacy Hyperfine and Liminal completed the Business Combination, pursuant to which each of Legacy Hyperfine and Liminal became a wholly owned subsidiary of HealthCor, HealthCor s corporate name was changed to Hyperfine, Inc., Legacy Hyperfine s name was changed to Hyperfine Operations, Inc., Liminal s name was changed to Liminal Operations, Inc., and the business of Legacy Hyperfine and Liminal became the business of the Company.
+Our principal executive offices are located at 351 New Whitfield Street, Guilford, Connecticut 06437, and our telephone number is (203) 458-7100.
+Emerging Growth Company
+We are an emerging growth company, as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ), and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved..
+Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a registration statement under the Securities Act declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. We have elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our financial statements with another public company which is not an emerging growth company or is an emerging growth company that has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.
+We will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) following the fifth anniversary of the closing of HealthCor s Initial Public Offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common equity that is held by non-affiliates is $700 million or more as of the end of that fiscal year s second fiscal quarter; and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company have the meaning associated with it in the JOBS Act.
+ 
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+THE OFFERING
+
+Issuer
+Hyperfine, Inc.
+
+Resale of Class A common stock and Class B common stock 
+ 
+
+Shares of Class A common stock offered by the Selling Securityholders (representing the Founder Shares, the Private Placement Shares, shares issued in the PIPE Investment, the shares issued to our directors, officers and affiliates and the directors, officers and affiliates of Legacy Hyperfine or Liminal pursuant to the Business Combination Agreement, including shares that may be issued upon the exercise of stock options and the vesting of restricted stock units or upon the conversion of shares of Class B common stock, and the Letter Agreement Shares)
+42,263,946 shares
+
+Shares of Class B common stock offered by the Selling Securityholders
+15,055,288 shares
+
+Use of proceeds
+We will not receive any proceeds from the sale of the Class A common stock and Class B common stock to be offered by the Selling Securityholders. With respect to shares of Class A common stock underlying the options, we will not receive any proceeds from such shares except with respect to amounts received by us upon exercise of such options to the extent such options are exercised for cash. 
+
+Lock-up agreements
+Certain of our stockholders are subject to certain restrictions on transfer until the termination of applicable lock-up periods. See Plan of Distribution Amended and Restated Registration Rights Agreement for further discussion.
+
+Ticker symbol
+ HYPR for the Class A common stock.
+
+ 
+ 
+ 
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+RISK FACTORS
+An investment in our securities involves a high degree of risk. You should carefully consider the risks described below before making an investment decision. Our business, prospects, financial condition, or operating results could be harmed by any of these risks, as well as other risks not known to us or that we consider immaterial as of the date of this prospectus. The trading price of our securities could decline due to any of these risks, and, as a result, you may lose all or part of your investment.
+Risks Related to Our Business and Industry
+Unless the context otherwise requires, references in this section to we, us, our and the Company refer to Hyperfine, Inc. and its subsidiaries following the Business Combination, or to Legacy Hyperfine, Liminal, or HealthCor prior to the Business Combination, as the case may be.
+Risks Related to Our Financial Condition and Capital Requirements
+We are an early-stage life sciences technology company with a history of net losses, which we expect to continue, and we may not be able to generate meaningful revenues or achieve and sustain profitability in the future.
+We are an early-stage life sciences technology company, and have incurred significant losses since Legacy Hyperfine and Liminal formed in 2014 and 2018, respectively, and expect to continue to incur losses in the future. We incurred net losses of $16.6 million and $38.8 million for the nine months ended September 30, 2020 and 2021, respectively, and net losses of $19.4 million and $23.4 million for the years ended December 31, 2019 and 2020, respectively. As of September 30, 2021, we had an accumulated deficit of $110.2 million. These losses and accumulated deficit were primarily due to the substantial investments made to develop and improve our technology and products. Over the next several years, we expect to continue to devote substantially all of our resources towards continuing development and commercialization of our products and research and development efforts for additional products. These efforts may prove more costly than we currently anticipate. We have just begun generating product revenue but may never generate revenue sufficient to offset our expenses, or at all. In addition, as a public company, we will incur significant legal, accounting, administrative, insurance and other expenses that we did not incur as a private company. Accordingly, we cannot assure you that we will achieve profitability in the future or that, if we become profitable, will sustain profitability.
+We have a limited operating history, which may make it difficult to evaluate the prospects for our future viability and predict our future performance. As such, you cannot rely upon our historical operating performance to make an investment or voting decision regarding us.
+We have generated limited revenue from the sale of our products and services to date and has incurred significant losses. Our prospects must be considered in light of the uncertainties, risks, expenses, and difficulties frequently encountered by companies in their early stages of operations. We have not yet achieved wide market acceptance for our products, produced our products at scale, refined our sales model, or conducted at scale sales and marketing activities necessary for successful mass product adoption. Consequently, predictions about our future success or viability are highly uncertain and may not be as accurate as they could be if we had a longer operating history or a company history of successfully developing and commercializing products.
+In addition, as a business with a limited operating history, we may encounter unforeseen expenses, difficulties, complications, delays and other known and unknown obstacles. We will need to transition from a company in the early commercialization stage to large scale commercialization, and we may not be successful in such a transition. We have encountered in the past, and will encounter in the future, risks and uncertainties frequently experienced by growing companies with limited operating histories in emerging and rapidly changing industries. If our assumptions regarding these risks and uncertainties, which we will use to plan and operate our business, are incorrect or change, or if we do not address these risks successfully, our results of operations could differ materially from our expectations, and our business, financial condition and results of operations could be adversely affected.
+We may need to raise additional capital to fund commercialization plans for our products, including manufacturing, sales and marketing activities, expand our investments in research and development, and commercialize new products and applications.
+Our operations have consumed substantial amounts of cash since inception. We expect to use the funds received in connection with the Business Combination to develop and further commercialize our products, develop new products, and for working capital and 
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+general corporate purposes. We may require additional capital to further develop and commercialize our products and to develop new products. In addition, our operating plans may change as a result of many factors that may currently be unknown to us, and we may need to seek additional funds sooner than planned.
+We cannot guarantee that future financing will be available in sufficient amounts or on terms acceptable to us, if at all. Moreover, the terms of any future financing may adversely affect the holdings or the rights of our stockholders and the issuance of additional securities, whether equity or debt, by us, or the possibility of such issuance, may cause the market price of our Class A common stock to decline. The incurrence of indebtedness could result in increased fixed payment obligations, and we may be required to agree to certain restrictive covenants, such as limitations on our ability to incur additional debt, limitations on our ability to acquire, sell or license intellectual property rights and other operating restrictions that could adversely impact our ability to conduct our business. We could also be required to seek funds through arrangements with collaborative partners or otherwise at an earlier stage than otherwise would be desirable, and we may be required to relinquish rights to some of our technologies or products or otherwise agree to terms that are unfavorable to us, any of which may have a material adverse effect on our business, operating results and prospects. In addition, raising additional capital through the issuance of equity or convertible debt securities would cause dilution to holders of our equity securities, and may affect the rights of then-existing holders of our equity securities. Even if we believes that we have sufficient funds for our current or future operating plans, we may seek additional capital if market conditions are favorable or if we have specific strategic considerations.
+Our operating results may fluctuate significantly in the future, which makes our future operating results difficult to predict and could cause our operating results to fall below expectations or any guidance we may provide.
+Our quarterly and annual operating results may fluctuate significantly, which makes it difficult for us to predict our future operating results. These fluctuations may occur due to a variety of factors, many of which are outside our control, including, but not limited to:
+ the timing and amount of expenditures that we may incur to develop, commercialize or acquire additional products and technologies or for other purposes, such as the expansion of our sales team and our facilities;
+ changes in governmental funding of life sciences research and development or changes that impact budgets or budget cycles;
+ seasonal spending patterns of our customers;
+ the timing of when we recognize any revenues;
+ future accounting pronouncements or changes in our accounting policies;
+ the outcome of any future litigation or governmental investigations involving the Company, our industry or both;
+ higher than anticipated service, replacement and warranty costs;
+ the impact of the COVID-19 pandemic on the economy, investment in the life sciences and medical technology industries, our business operations, and resources and operations of our suppliers, future distributors and current and potential customers; and
+ general industry, economic and market conditions and other factors, including factors unrelated to our operating performances or the operating performance of our competitors.
+
+The cumulative effects of the factors discussed above could result in large fluctuations and unpredictability in our quarterly and annual operating results. As a result, comparing our operating results on a period-to-period basis may not be meaningful.
+This variability and unpredictability could also result in us failing to meet the expectations of industry or financial analysts or investors for any period. If we are unable to further commercialize products or generate revenue, or if our operating results fall below 
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+the expectations of analysts or investors or below any guidance we may provide, or if the guidance we provide is below the expectations of analysts or investors, the market price of our Class A common stock could decline.
+Risks Related to Our Businesses
+Our success depends upon market acceptance of our products and services, our ability to develop and commercialize existing and new products and services and generate revenues, and our ability to identify new markets for our technology.
+We have developed, and are engaged in the development of, MRI solutions and non-invasive neural monitoring technology. We are commercializing our Swoop Portable MRI System to address limitations of current imaging technologies. Other product candidates, such as our non-invasive brain vital sensors, are currently under development. Our success will depend on the acceptance of our products and services in the U.S. and international healthcare markets. The marketplace may not be receptive to our products and services over competing products, including conventional MRI systems used in hospitals, imaging centers and physicians offices, and we may be unable to compete effectively. Factors that could affect our ability to successfully further commercialize our current products and services and to commercialize any potential future products and services include:
+ challenges of developing (or acquiring externally-developed) technology solutions that are adequate and competitive in meeting the requirements of next-generation design challenges; and
+ dependence upon physicians and other healthcare practitioners acceptance of our products.
+
+We cannot assure investors that our current products and services or any future products and services will gain broad market acceptance. If the market for our current products and services or any future products and services fails to develop or develops more slowly than expected, or if any of our products or services do not achieve or sustain market acceptance, our business and operating results would be materially and adversely affected.
+Medical device development is costly and involves continual technological change, which may render our current or future products obsolete.
+The market for point-of-care medical devices is characterized by rapid technological change, medical advances and evolving industry standards. Any one of these factors could reduce the demand for our devices or services or require substantial resources and expenditures for research, design and development to avoid technological or market obsolescence.
+Our success will depend on our ability to enhance our current technology, products and services and develop or acquire and market new technologies to keep pace with technological developments and evolving industry standards, while responding to changes in customer needs. A failure to adequately develop or acquire device enhancements or new devices that will address changing technologies and customer requirements adequately, or to introduce such devices on a timely basis, may have a material adverse effect on our business, financial condition and results of operations.
+We might have insufficient financial resources to improve existing devices, advance technologies and develop new devices at competitive prices. Technological advances by one or more competitors or future entrants into the field may result in our current devices becoming non-competitive or obsolete, which may decrease revenues and profits and adversely affect our business and results of operations.
+We may encounter significant competition across our existing and future planned products and services and in each market in which we sell or plan to sell our products and services from various companies, many of which have greater financial and marketing resources than us. Our primary competitors include several large companies which currently dominate the medical imaging market, including General Electric, Siemens, Philips, Hologic, Varian, Fuji, Toshiba, Canon and Hitachi.
+In addition, our competitors, some of which are well-established manufacturers with significant resources, may engage in aggressive marketing tactics. Competitors may also possess the ability to commercialize additional lines of products, bundle products or offer higher discounts and incentives to customers in order to gain a competitive advantage. If the prices of competing products are lowered as a result, we may not be able to compete effectively.
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+We will be dependent upon the success of our sales and customer acquisition and retention strategies.
+Our business is dependent upon the success of our sales and customer acquisition and retention strategies, and our marketing efforts are focused on developing a strong reputation with healthcare providers and increasing awareness of our products and services. If we fail to maintain a high quality of service or a high quality of device technology, we may fail to retain existing users or add new users. If we do not successfully continue our sales efforts and promotional activities, particularly to health systems and large institutions, or if existing users decrease their level of engagement, our revenue, financial results and business may be significantly harmed. Our future success depends upon continued expansion of our commercial operations in the United States and internationally, as well as entering additional markets to commercialize our products and services. We believe that our growth will depend on the further development and commercialization of our current products and services and regulatory authorization for our future products and services. If we fail to expand the use of our products and services in a timely manner, we may not be able to expand our market share or to grow our revenue. Our financial performance will be substantially dictated by our success in adding, retaining and engaging active users of our products. If customers do not perceive our products or services to be useful, reliable and trustworthy, we may not be able to attract or retain customers or otherwise maintain or increase the frequency and duration of their engagement. As our business model is predicated on device hardware sales, software subscriptions, and subscriptions for use of device hardware and software, there is risk that any decline in sales, subscriptions and subscription renewal rates will adversely impact our business. A decrease in customer retention, growth or engagement with our products and services may have a material and adverse impact on our revenue, business, financial condition and results of operations.
+Any number of factors could negatively affect customer retention, growth and engagement, including:
+ customers choosing competing products or choosing to use conventional MRI systems over our products;
+ failure to introduce new and improved products and services;
+ inability to continue to develop products that customers find effective and that achieve a high level of market acceptance;
+ changes in customer sentiment about the quality or usefulness of our products and services or concerns related to safety, security, privacy and data sharing or other factors;
+ adverse changes in our products that are mandated by legislation or regulatory agencies, both in the United States and internationally; or
+ technical or other problems preventing us from delivering products or services in a rapid and reliable manner or otherwise affecting the user experience.
+
+If we do not successfully manage the commercialization of our products and services, including continuing to build our sales force, and the development and launch of new products and services, we will not meet the long term forecasts and our business, operating and financial results and condition could be adversely affected.
+We face risks associated with commercializing existing products and services and launching new products and services. If we encounter commercialization, development or manufacturing challenges or discovers errors during our product development cycle, the product launch dates of new products may be delayed, which will cause delays in our ability to achieve our forecasted results. The expenses or losses associated with unsuccessful product development or launch activities or lack of market acceptance of our products and services could adversely affect our business or financial condition.
+We expect to generate an increasing portion of our revenue internationally in the future and may become subject to various additional risks relating to our international activities, which could adversely affect our business, operating results and financial condition.
+We believe that a substantial percentage of our future revenue will come from international sources as we seek regulatory authorization for our products beyond the United States and expands our sales and marketing opportunities internationally. We have 
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+limited experience operating internationally and engaging in international business involves a number of difficulties and risks, including:
+ the challenges associated with building local brand awareness, obtaining local key opinion leader support and clinical support, implementing reimbursement strategies and building local marketing and sales teams;
+ required compliance with foreign regulatory requirements and laws, including regulations and laws relating to patient data and medical devices;
+ trade relations among the United States and those foreign countries in which our current or future customers, distributors, manufacturers and suppliers have operations, including protectionist measures such as tariffs and import or export licensing requirements, whether imposed by the United States or such foreign countries, in particular the strained trade relations between United States and China since 2018;
+ difficulties and costs of staffing and managing foreign operations;
+ difficulties protecting, procuring or enforcing intellectual property rights internationally;
+ required compliance with anti-bribery laws, such as the U.S. Foreign Corrupt Practices Act, data privacy requirements, labor laws and anti-competition regulations;
+ laws and business practices that may favor local companies;
+ longer payment cycles and difficulties in enforcing agreements and collecting receivables through certain foreign legal systems;
+ political and economic instability; and
+ potentially adverse tax consequences, tariffs, customs charges, bureaucratic requirements and other trade barriers.
+
+If we dedicate significant resources to our international operations and are unable to manage these risks effectively, our business, operating results and financial condition may be adversely affected.
+We are subject to export and import control laws and regulations that could impair our ability to compete in international markets or subject us to liability if we violate such laws and regulations.
+We are required to comply with export and import control laws, which may affect our ability to enter into or complete transactions with certain customers, business partners, and other persons. In certain circumstances, export control regulations may prohibit the export of certain products, services, and technologies. We may be required to obtain an export license before exporting a controlled item, and granting of a required license cannot be assured. Compliance with the import laws that apply to our businesses may restrict our access to, and may increase the cost of obtaining, certain products and could interrupt our supply of imported inventory.
+Exported technologies necessary to develop and manufacture certain products are subject to U.S. export control laws and similar laws of other jurisdictions. We may be subject to adverse regulatory consequences, including government oversight of facilities and export transactions, monetary penalties, and other sanctions for violations of these laws. In certain instances, these regulations may prohibit us from developing or manufacturing certain of our products for specific applications outside the United States. Failure to comply with any of these laws and regulations could result in civil and criminal, monetary, and nonmonetary penalties; disruptions to our business; limitations on our ability to import and export products and services; or damage to our reputation.
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+If we experience decreasing prices for our products and are unable to reduce our expenses, including the per unit cost of producing our products, there may be a material adverse effect on our business, results of operations, financial condition and cash flows.
+We may experience decreasing prices for our products due to pricing pressure from managed care organizations and other third-party payors and suppliers, increased market power of our payors as the medical device industry consolidates, and increased competition among suppliers, including manufacturing services providers. If the prices for our products and services decrease and we are unable to reduce our expenses, including the cost of sourcing materials, logistics and the cost to manufacture our products, our business, results of operations, financial condition and cash flows may be adversely affected. To the extent that we engages in enterprise sales, we may be subject to procurement discounts, which could have a negative impact on the prices of our products.
+If we are unable to attract, recruit, train, retain, motivate and integrate key personnel, we may not achieve our goals.
+Our future success depends on our ability to attract, recruit, train, retain, motivate and integrate key personnel, including our Vice Chairman and the Founder of Legacy Hyperfine and Liminal, Dr. Jonathan Rothberg, our Executive Chairman, Scott Huennekens, and our Chief Executive Officer, Dave Scott, as well as our recently expanded management team and our research and development, manufacturing, software engineering and sales and marketing personnel. Competition for qualified personnel is intense.
+We believe that our management team must be able to act decisively to apply and adapt our business model in the rapidly changing markets in which we compete. In addition, we rely upon technical and scientific employees or third-party contractors to effectively establish, manage and grow our business. Consequently, we believe that our future viability will depend largely on our ability to attract and retain highly skilled managerial, sales, scientific and technical personnel. In order to do so, we may need to pay higher compensation or fees to our employees or consultants than we currently expect, and such higher compensation payments may have a negative effect on our operating results. Competition for experienced, high-quality personnel is intense, and we cannot assure investors that we will be able to recruit and retain such personnel. Our growth depends, in particular, on attracting and retaining highly-trained sales personnel with the necessary technical background and ability to understand our products and services at a technical level to effectively identify and sell to potential new customers and develop new products. Because of the technical nature of our products and the dynamic market in which we compete, any failure to attract, recruit, train, retain, motivate and integrate qualified personnel could materially harm our operating results and growth prospects.
+We will need to expand our organization, and we may experience difficulties in recruiting needed additional employees and consultants, which could disrupt our operations.
+As our development and commercialization plans and strategies develop, we will need additional managerial, operational, sales, marketing, financial, legal and other resources. The competition for qualified personnel in the medical device industry is intense. Due to this intense competition, we may be unable to attract and retain the qualified personnel necessary for the development of our business or to recruit suitable replacement personnel.
+Our management may need to divert a disproportionate amount of our attention away from our day-to-day activities and devote a substantial amount of time to managing these growth activities. We may not be able to effectively manage the expansion of our operations, which may result in weaknesses in our infrastructure, operational mistakes, loss of business opportunities, loss of employees and reduced productivity among remaining employees. Our expected growth could require significant capital expenditures and may divert financial resources from other projects, such as the development of additional products. If our management is unable to effectively manage our growth, our expenses may increase more than expected, our ability to generate and/or grow revenue could be reduced and we may not be able to implement our business strategy. Our future financial performance and our ability to commercialize products and services and compete effectively will depend, in part, on our ability to effectively manage any future growth.
+We have limited experience in marketing and selling our products and related services, and if we are unable to successfully commercialize our products and related services, our business and operating results will be adversely affected.
+We have limited experience marketing and selling our products and related services. We began selling our Swoop MRI scanner in 2020 and currently sell the device directly to customers through direct sales of regional sales representatives. Future sales of our products will depend in large part on our ability to effectively market and sell our products and services, successfully manage and 
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+expand our sales force, and increase the scope of our marketing efforts. We may also enter into distribution arrangements in the future. Because we have limited experience in marketing and selling our products, our ability to forecast demand, the infrastructure required to support such demand and the sales cycle to customers is unproven. If we do not build an efficient and effective marketing and sales force, our business and operating results will be adversely affected.
+We rely on a single contract manufacturer, Benchmark Electronics, Inc. ( Benchmark ), to test, assemble and supply our finished products. If Benchmark fails to fulfill its obligations under its existing contractual arrangements with us or does not perform satisfactorily, our ability to source our devices could be negatively and adversely affected.
+In October 2018, Legacy Hyperfine entered into a Manufacture and Supply Agreement with Benchmark (the MSA ). Under the MSA, Benchmark agreed to manufacture our products pursuant to binding purchase orders. The parties have agreed to meet periodically regarding any minimum order quantities of components under the MSA. We also have certain inventory related obligations, including the obligation to purchase excess and obsolete components from Benchmark. See Business of Hyperfine - Key Agreements - Manufacture and Supply Agreement with Benchmark Electronics, Inc. 
+In the event it becomes necessary to utilize a different contract manufacturer for our component products, we would experience additional costs, delays and difficulties in obtaining such components as a result of identifying and entering into an agreement with a new contract manufacturer as well as preparing such new manufacturer to meet the logistical requirements associated with manufacturing our devices, and our business would suffer.
+We rely on a limited number of suppliers for our products. A loss of any of these suppliers could negatively affect our business.
+We rely on a limited number of suppliers to manufacture components for our products, including in some cases only a single supplier for some of our components. One key custom-made component in our Swoop scanner is the magnet, which is manufactured by a single source supplier in Europe. Our reliance on a limited number of suppliers increases our risks, since we do not currently have alternative or replacement suppliers beyond these key parties. In the event of interruption from any of our suppliers, we may not be able to increase capacity from other sources or develop alternate or secondary sources without incurring material additional costs and substantial delays.
+If we experience a significant increase in demand for our products, or if we need to replace an existing supplier or manufacturer, we may be unable to supplement or replace them on terms that are acceptable to us, which may undermine our ability to deliver our products to customers in a timely manner. Identifying suitable suppliers and manufacturers is an extensive process that requires us to become satisfied with their quality control, technical capabilities, responsiveness and service, financial stability, regulatory compliance, and labor and other ethical practices. Accordingly, a loss of any of our suppliers or our device manufacturer could have an adverse effect on our business, financial condition and operating results.
+Pricing pressures from contract suppliers or manufacturers on which we rely may impose pricing pressures.
+Third party suppliers utilized by our manufacturer such as Benchmark Electronics, Inc. may also impose pricing pressures. Because we currently also rely on Benchmark Electronics, Inc. to manufacture, test and ship all of the Swoop scanners and on a limited number of suppliers to supply our components, including a single source supplier of the magnet used in the scanner, such pricing pressures from a third party such as Benchmark Electronics, Inc. could increase our costs and could force us to increase the prices of our products if we are unable to enter into alternative arrangements with other suppliers or manufacturers, potentially leading to decreased customer demand.
+If we do not successfully optimize and operate our sales and potential future distribution channels or we do not effectively expand and update our infrastructure, our operating results and customer experience may be negatively impacted.
+If we do not adequately predict market demand or otherwise optimize and operate our sales and potential future distribution channels successfully, it could result in excess or insufficient inventory or fulfillment capacity, increased costs, or immediate shortages in product or component supply, or harm our business in other ways. In addition, if we do not maintain adequate infrastructure to enable us to, among other things, manage our purchasing and inventory, it could negatively impact our operating results and customer experience.
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+The market for our products and services is new, rapidly evolving, and increasingly competitive, as the healthcare industry in the United States is undergoing significant structural change, which makes it difficult to forecast demand for our products and services.
+The market for our products and services is new and rapidly evolving, and it is uncertain whether we will achieve and sustain high levels of demand and market adoption. Our future financial performance will depend in part on growth in this market and on our ability to adapt to the changing demands of customers. It is difficult to predict the future growth rate and size of our target market. As a result, our commercial expectations may not be achieved. Negative publicity concerning our products could limit market acceptance of our products and services. If our customers do not perceive the benefits of our products and services, or if our products and services do not attract new customers, then our market may not develop at all, or we may develop more slowly than we expect. Our success will depend to a substantial extent on the willingness of healthcare organizations to increase their use of our technology and our ability to demonstrate the value of our technology relative to competing products and services to existing and potential customers. If healthcare organizations do not recognize or acknowledge the benefits of our products and services or if we are unable to reduce healthcare costs or drive positive health outcomes, then the market for our solutions might not develop at all, or might develop more slowly than we expect. Similarly, negative publicity regarding patient confidentiality and privacy in the context of technology-enabled healthcare or concerns experienced by competitors could limit market acceptance of our products and services.
+The healthcare industry in the United States is undergoing significant structural change and is rapidly evolving. Our products and services are offered on a subscription basis, and the adoption of subscription business models is still relatively new, especially in the healthcare industry. If companies do not shift to subscription business models and subscription health management tools do not achieve widespread adoption, or if there is a reduction in demand for subscription products and services or subscription health management tools, our business, financial condition, and results of operations could be adversely affected.
+Quality problems could lead to recalls or safety alerts and/or reputational harm and could have a material adverse effect on our business, results of operations, financial condition and cash flows.
+Quality of our products is very important to us and our customers due to the serious and costly consequences of product failure. Our business exposes us to potential product liability risks that are inherent in the design, manufacture, and marketing of medical devices. Product or component failures, manufacturing nonconformities, design defects, off-label use, or inadequate disclosure of product-related risks or product-related information with respect to our products, if they were to occur, could result in inaccurate imaging and safety risks. These problems could lead to the recall of, or the issuance of a safety alert relating to, our products, and could result in product liability claims and lawsuits.
+Additionally, the manufacture and production of our products must occur in a highly controlled and clean environment to minimize particles and other yield- and quality-limiting contaminants. Weaknesses in process control or minute impurities in materials may cause defective products. If we are not able to maintain stringent quality controls, or if contamination problems arise, our development and commercialization efforts could be delayed, which would harm our business and results of operations.
+If we fail to meet any applicable product quality standards and our products are the subject of recalls or safety alerts, our reputation could be damaged, we could lose customers, and our revenue and results of operations could decline.
+If we are not able to develop and release new products and services, or successful enhancements, new features and modifications to our existing products and services, to successfully implement our software subscription solutions or to achieve adequate clinical utility, our business, financial condition and results of operations could be adversely affected.
+The markets in which we operate are characterized by rapid technological change, frequent new product and service introductions and enhancements, changing customer demands, and evolving industry standards. The introduction of products and services embodying new technologies can quickly make existing products and services, including software subscriptions, obsolete and unmarketable. Additionally, changes in laws and regulations could impact the usefulness of our products and could necessitate changes or modifications to our products to accommodate such changes. We invest substantial resources in researching and developing new products and enhancing existing products by incorporating additional features, improving functionality, and adding other improvements to meet customers evolving needs. The success of any enhancements or improvements to our existing products or any new products depends on several factors, including timely completion, competitive pricing, adequate quality testing, integration with new and existing technologies and third-party partners technologies and overall market acceptance. We may not succeed in 
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+developing, marketing and delivering on a timely and cost-effective basis enhancements or improvements to our existing products or any new products that respond to continued changes in market demands or new customer requirements, and any enhancements or improvements to our products or any new solutions may not achieve market acceptance. Since developing our products is complex, the timetable for the release of new products and enhancements to existing products is difficult to predict, and we may not offer new products and updates as rapidly as our customers require or expect. Any new products that we develop may not be introduced in a timely or cost-effective manner, may contain errors or defects, or may not achieve the broad market acceptance necessary to generate sufficient revenue. Moreover, even if we introduce new products, we may experience a decline in revenue from our existing products that is not offset by revenue from the new products. For example, customers may delay making purchases of new products to permit them to make a more thorough evaluation of these products or until industry and marketplace reviews become widely available. Customers may also delay purchasing a new product because their existing product or other device continues to meet their needs. Some customers may hesitate to migrate to a new product due to concerns regarding the performance of the new product. In addition, we may lose existing customers who choose a competitor s products and services. This could result in a temporary or permanent revenue shortfall and adversely affect our business, financial condition and results of operations.
+The introduction of new products and solutions by competitors, the development of entirely new technologies to replace existing offerings or shifts in healthcare benefits trends could make our products obsolete or adversely affect our business, financial condition and results of operations. We may experience difficulties with software development, industry standards, design or marketing that could delay or prevent our development, introduction or implementation of new products, enhancements, additional features or capabilities. If customers do not widely purchase and adopt our products, we may not be able to realize a return on our investment. If we do not accurately anticipate customer demand or if we are unable to develop, license or acquire new features and capabilities on a timely and cost-effective basis, or if such enhancements do not achieve market acceptance, it could result in adverse publicity, loss of revenue or market acceptance or claims by customers brought against us, each of which could have a material and adverse effect on our reputation, business, results of operations and financial condition.
+We are party to Technology and Services Exchange Agreements with certain affiliated companies, pursuant to which the parties agreed to share personnel and certain non-core technologies. The sharing arrangements under the agreements may prevent us from fully utilizing our personnel and/or the technologies shared under the agreements. Furthermore, if these agreements were to terminate, or if we was to lose access to these technologies and services, our business could be adversely affected.
+We entered into Technology and Services Exchange Agreements (each, a TSEA and collectively, the TSEA ) with other participant companies controlled by the Rothbergs. A TSEA by and among Butterfly Network, Inc., AI Therapeutics, Inc., Quantum-Si Incorporated, 4Bionics LLC, Tesseract Health, Inc., Detect, Inc. (f/k/a Homodeus Inc.), Legacy Hyperfine and Liminal was signed in November 2020; a TSEA by and among Quantum-Si Incorporated, AI Therapeutics, Inc., 4Bionics LLC, Tesseract Health, Inc., Detect, Inc., Legacy Hyperfine and Liminal was signed in February 2021 (and which Protein Evolution, Inc. joined in August 2021); and a TSEA by and among Legacy Hyperfine, Liminal, AI Therapeutics, Inc., Tesseract Health, Inc. and Detect, Inc. was signed in July 2021 and became effective upon the Closing. Under the TSEA, we and the other participant companies may, in their discretion, permit the use of certain non-core technologies, which include any technologies, information or equipment owned or otherwise controlled by the participant company that are not specifically related to the core business area of the participant, such as software, hardware, electronics, fabrication and supplier information, vendor lists and contractor lists, with the other participant companies. The TSEA provides that ownership of each non-core technology shared by us or another participant company will remain with the company that originally shared the non-core technology. In addition, any participant company (including us) may, in its discretion, permit its personnel to be engaged by another participant company to perform professional, technical or consulting services for such participant. Unless otherwise agreed to by us and the other participant company, all rights, title and interest in and to any inventions, works-of-authorship, idea, data or know-how invented, made, created or developed by the personnel (employees, contractors or consultants) in the course of conducting services for a participant company ( Created IP ) will be owned by the participant company for which the work was performed, and the recipient participant company grants to the party that had its personnel provide the services that resulted in the creation of the Created IP a royalty-free, perpetual, limited, worldwide, non-exclusive, sub-licensable (and with respect to software, sub-licensable in object code only) license to utilize the Created IP only in the core business field of the originating participant company, including a license to create and use derivative works based on the Created IP in the originating participant s core business field, subject to any agreed upon restrictions.
+The technology and personnel-sharing arrangements under the TSEA may prevent us from fully utilizing our personnel if such personnel are also being used by the other participant companies and may also cause our personnel to enter into agreements with or provide services to other companies that interfere with their obligations to us. Created IP under the TSEA may be relevant to our 
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+business and created by our personnel but owned by the other participant companies. Furthermore, if the TSEA were to terminate, or if we were to lose access to the technologies and services available pursuant to the TSEA, our business could be adversely affected.
+We may acquire other companies or technologies, which could fail to result in a commercial product or net sales, divert our management s attention, result in additional dilution to our stockholders and otherwise disrupt our operations and harm our operating results.
+We may in the future seek to acquire or invest in businesses, applications or technologies that we believe could complement or expand our portfolio, enhance our technical capabilities or otherwise offer growth opportunities. However, we cannot assure you that we would be able to successfully complete any acquisition we choose to pursue, or that we would be able to successfully integrate any acquired business, product or technology in a cost-effective and non-disruptive manner. The pursuit of potential acquisitions may divert the attention of management and cause us to incur various costs and expenses in identifying, investigating and pursuing suitable acquisitions, whether or not they are consummated. We may not be able to identify desirable acquisition targets or be successful in entering into an agreement with any particular target or obtain the expected benefits of any acquisition or investment.
+To date, the growth of our operations has been largely organic, and we have limited experience in acquiring other businesses or technologies. We may not be able to successfully integrate any acquired personnel, operations and technologies, or effectively manage the combined business following an acquisition. Acquisitions could also result in dilutive issuances of equity securities, the use of our available cash, or the incurrence of debt, which could harm our operating results. In addition, if an acquired business fails to meet our expectations, our operating results, business and financial condition may suffer.
+As international expansion of our business occurs, it will expose us to market, regulatory, political, operational, financial and economic risks associated with doing business outside of the United States.
+Our long-term strategy is to increase our international presence, including securing the necessary regulatory authorizations in the United Kingdom, Canada, Australia and New Zealand. We recently received regulatory authorization in Pakistan. This strategy may include establishing and maintaining physician outreach and education capabilities outside of the United States and expanding our relationships with international customers. Doing business internationally involves a number of risks, including:
+ Difficulties in staffing and managing our international operations;
+ Multiple, conflicting and changing laws and regulations such as tax laws, privacy laws, export and import restrictions, employment laws, regulatory requirements and other governmental approvals, permits and licenses;
+ Reduced or varied protection for intellectual property rights in some countries;
+ Obtaining regulatory clearance where required for our products in various countries;
+ Requirements to maintain data and the processing of that data on servers located within such countries;
+ Limits on our ability to penetrate international markets if we are required to manufacture our products locally;
+ Financial risks, such as longer payment cycles, difficulty collecting accounts receivable, foreign tax laws and complexities of foreign value-added tax systems, the effect of local and regional financial pressures on demand and payment for our products and exposure to foreign currency exchange rate fluctuations;
+ Restrictions on the site-of-service for use of our products and the economics related thereto for physicians and other healthcare practitioners;
+ Natural disasters, political and economic instability, including wars, terrorism, political unrest, outbreak of disease, boycotts, curtailment of trade and other market restrictions; and
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+ Regulatory and compliance risks that relate to maintaining accurate information and control over activities subject to regulation under the U.S. Foreign Corrupt Practices Act, and comparable laws and regulations in other countries.
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+Any of these factors could significantly harm our future international expansion and operations and, consequently, have a material adverse effect on our business, financial condition and results of operations.
+The COVID-19 pandemic has and could continue to negatively affect various aspects of our business, make it more difficult for us to meet our obligations to our customers, and result in reduced demand for our products and services, which could have a material adverse effect on our business, financial condition, results of operations, or cash flows.
+In December 2019, a novel strain of coronavirus was reported to have surfaced in Wuhan, China, and it has since spread throughout other parts of the world, including the United States. Any outbreak of contagious diseases, or other adverse public health developments, could have a material adverse effect on our business operations. These impacts to our operations have included, and could again in the future include, disruptions or restrictions on the ability of our employees and customers to travel or of us to pursue collaborations and other business transactions, travel to customers and/or conduct live demonstrations of our products at promotional events, oversee the activities of our third-party manufacturers and suppliers and make shipments of materials. We may also be impacted by the temporary closure of the facilities of suppliers, manufacturers or customers. In addition, many hospitals and other healthcare providers continue to focus their attention on addressing COVID-19, which we believe has resulted in lower sales volume. The COVID-19 pandemic may also continue to have an impact on customers, as elective healthcare visits and procedures have been postponed and there is greater focus on areas of care with lower profitability, leading, as a consequence, to lower expenditures on new products and devices by healthcare institutions.
+In an effort to halt the outbreak of COVID-19, a number of countries, including the United States, have placed significant restrictions on travel and many businesses have announced extended closures. These travel restrictions and business closures have and may in the future adversely impact our operations locally and worldwide, including our ability to manufacture, market, sell or distribute our products, and such restrictions and closure have caused or may cause temporary closures of facilities of suppliers, manufacturers or customers. During the COVID-19 pandemic, our suppliers agreed to shift new work to domestic suppliers to help reduce the risk of manufacturing delays. Our supplier and sub tier suppliers have been adversely affected by COVID-19. Any disruption in the operations of our employees, suppliers, customers, manufacturers or access to customers would likely impact our sales and operating results. In addition, travel restrictions have made it more difficult for us to monitor the quality of our third party manufacturing operations when we are unable to conduct in-person quality audits of those facilities. We have also experienced increases in product costs as raw materials have been constrained. Prices have risen sharply over the past year, and lead times have extended dramatically, particularly on semiconductor products. Over the next 12 months, we expect prices to increase due to the raw material demand surges across numerous industries, along with labor and transportation related constraints. We also expect lead times to reduce as component production levels recover to meet demand. In addition, future regulatory authorizations by the FDA may take longer because of COVID-19 pandemic-related delays. We are continuing to monitor and assess the effects of the COVID-19 pandemic on our commercial operations. However, we cannot at this time accurately predict what effects these conditions will ultimately have on our operations due to uncertainties relating to variants such as Omicron, the severity of the disease, the duration of the outbreak, and the length of the travel restrictions and business closures imposed by the governments of impacted countries. In addition, the COVID-19 pandemic could continue to adversely affect the economies and financial markets of many countries, which could result in an economic downturn that could affect demand for our products and likely impact our operating results.
+Unfavorable global economic conditions could adversely affect our business, financial condition or results of operations.
+Our results of operations could be adversely affected by general conditions in the global economy and in the global financial markets, including changes in inflation, interest rates and overall economic conditions and uncertainties. For instance, if inflation or other factors were to significantly increase our business costs, it may not be feasible to pass price increases on to our customers. Inflation could also adversely affect the ability of our customers to purchase our products. An economic downturn, including as a result of COVID-19, could result in a variety of risks to our business, including weakened demand for our products and our inability to raise additional capital when needed on acceptable terms, if at all. A weak or declining economy could also strain our manufacturers and suppliers, possibly resulting in supply disruption, or cause future customers to delay making payments for our products. Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the current economic climate and financial market conditions could adversely impact our business.
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+The enactment of legislation implementing changes in the U.S. Taxation of international business activities, the adoption of other tax reform policies or changes in tax legislation or policies in jurisdictions outside of the United States could materially impact our results of operations and financial condition.
+We are subject to income tax in the numerous jurisdictions in which we operate. Reforming the taxation of international businesses has been a priority for politicians, and a wide variety of potential changes have been proposed. Some proposals, several of which have been enacted, impose incremental taxes on gross revenue, regardless of profitability. Furthermore, it is reasonable to expect that global taxing authorities will be reviewing current legislation for potential modifications in reaction to the implementation of the 2017 Tax Cuts and Jobs Act (the Tax Act ) in the United States. Due to the expanding scale of our international business activities, changes in the taxation of such activities may increase our worldwide effective tax rate and the amount of taxes we pay and harm our business.
+In the United States, the Tax Act enacted on December 22, 2017 significantly affected U.S. Tax law by changing how the United States imposes income tax on multinational corporations. The U.S. Department of Treasury has broad authority to issue regulations and interpretative guidance that may significantly impact how we will apply the law and impact our results of operations in the period issued.
+The Tax Act requires complex computations not previously provided in U.S. Tax law. As such, the application of accounting guidance for such items remain uncertain. Further, compliance with the Tax Act and the accounting for such provisions requires an accumulation of information not previously required or regularly produced. As additional regulatory guidance is issued by the applicable taxing authorities, as accounting treatment is clarified, and as we perform additional analysis on the application of the law, our effective tax rate could be materially different.
+U.S. Taxation of international business activities or the adoption of tax reform policies could materially impact our future financial position and results of operations.
+Limitations on the ability of taxpayers to claim and utilize foreign tax credits and the deferral of certain tax deductions until earnings outside of the United States are repatriated to the United States, as well as changes to U.S. Tax laws that may be enacted in the future, could impact the tax treatment of future foreign earnings. Should the scale of our international business activities expand, any changes in the U.S. Taxation of such activities could increase our worldwide effective tax rate and harm our future financial position and results of operations.
+We may face exposure to foreign currency exchange rate fluctuations.
+While we have historically transacted in U.S. Dollars with the majority of our customers and suppliers, we have transacted in some foreign currencies and may transact in more foreign currencies in the future. Accordingly, changes in the value of foreign currencies relative to the U.S. Dollar may affect our revenue and operating results. As a result of such foreign currency exchange rate fluctuations, it could be more difficult to detect underlying trends in our business and operating results. In addition, to the extent that fluctuations in currency exchange rates cause our operating results to differ from our expectations or the expectations of our investors, the trading price of our stock could be adversely affected.
+Risks Related to Healthcare Industry Shifts and Changing Regulations
+We are subject to extensive government regulation, which could restrict the development, marketing, sale and distribution of our products and could cause us to incur significant costs.
+Our medical devices and associated services are subject to extensive pre-market and post-market regulation by the FDA and various other federal, state, local and foreign government authorities. Government regulation of medical devices is meant to assure their safety and effectiveness, and includes requirements for, among other things:
+ design, development and manufacturing processes;
+ labeling, content and language of instructions for use and storage;
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+ product testing, nonclinical studies and clinical trials;
+ regulatory clearances and approvals, including pre-market clearance or pre-market approval;
+ establishment registration, device listing and ongoing compliance with the QSR requirements;
+ advertising and promotion;
+ marketing, sales and distribution;
+ conformity assessment procedures;
+ product traceability and record-keeping procedures;
+ review of product complaints, complaint reporting, recalls and field safety corrective actions;
+ post-market surveillance, including reporting of deaths or serious injuries and malfunctions that, if they were to recur, could lead to death or serious injury;
+ post-market studies (if applicable); and
+ product import and export.
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+The laws and regulations to which we and our products are subject are complex and subject to periodic changes. Regulatory changes could result in restrictions on our ability to carry on or expand our operations, higher than anticipated costs or lower than anticipated sales.
+Before a new medical device, or a significant modification of a medical device, including a new use of or claim for an existing product, can be marketed in the United States, we must first receive either 510(k) clearance or premarket approval ( PMA ) from the FDA, unless an exemption applies. In the 510(k) clearance process, the FDA must determine that a proposed device is substantially equivalent to a device legally on the market, known as a predicate device, with respect to intended use, technology and safety and effectiveness, in order to clear the proposed device for marketing. Clinical data is sometimes required to support substantial equivalence. Legacy Hyperfine received 510(k) clearance from the FDA for its point-of-care MRI system in 2020. In addition, Legacy Hyperfine s proprietary BrainInsight product is a fully automated MR imaging post-processing medical software that is regulated as a picture archiving and communications system, which may include both hardware and software components, and which is classified by FDA as a Class II medical device. BrainInsight received 510(k) marketing clearance in January 2021 for use in automatic labeling, spatial measurement, and volumetric quantification of brain structures from a set of low-field MR images and to return annotated and segmented images, color overlays, and reports. More recently, in November 2021, Legacy Hyperfine received 510(k) clearance for its new advanced image reconstruction technology using deep learning.
+We may be required to obtain a new 510(k) clearance or PMA approval for significant post-market modifications to our products, including any modifications made to the commercially marketed our devices. In addition, Liminal does not have any commercial products. When Liminal s products are marketed for clinical monitoring or therapeutic uses, they will be regulated by the FDA as medical devices. Because the products are still in development, it is presently unclear what level of risk the agency will assign to such products, what special controls may be imposed on such products (if any), and what regulatory requirements would be applicable to such products.
+Obtaining 510(k) clearance or PMA approval for medical devices can be expensive and time-consuming, and entails significant user fees, unless an exemption is available. The FDA s process for obtaining 510(k) clearance usually takes three to 12 months, but it can last longer. In the PMA approval process, the FDA must determine that a proposed device is safe and effective for its intended use based, in part, on extensive data, including but not limited to, technical, nonclinical, clinical trial, manufacturing and labeling data. The process for obtaining a PMA is more costly and uncertain and approval can take anywhere from at least one year to, in some cases, multiple years from the time the application is initially filed with the FDA. Modifications to products that are approved through 
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+a PMA application generally require further FDA approval. Some of our future products may require PMA approval. In addition, the FDA may demand that we obtain a PMA prior to marketing future changes of our existing products. Further, we may not be able to obtain additional 510(k) clearances or PMAs for new products or for modifications to, or additional indications for, our products in a timely fashion or at all. Delays in obtaining future clearances or approvals could adversely affect our ability to introduce new or enhanced products in a timely manner, which in turn could harm our revenue and future profitability.
+In order to conduct a clinical investigation involving human subjects for the purpose of demonstrating the safety and effectiveness of a medical device, if necessary, for a PMA application or 510(k) notification, a company must, among other things, apply for and obtain institutional review board ( IRB ) approval of the proposed investigation. In addition, if the clinical study involves a significant risk (as defined by the FDA) to human health, the sponsor of the investigation must also submit and obtain FDA approval of an investigational device exemption ( IDE ) application and follow applicable IDE regulations. Unless IDE-exempt, nonsignificant risk devices are still subject to certain abbreviated IDE requirements, however, an IDE application is not required if such abbreviated requirements are met. We may not be able to obtain any necessary FDA and/or IRB approval to undertake clinical trials in the United States for future devices we develop and intend to market in the United States. If we do obtain such approvals, the FDA may find that our studies do not comply with the IDE or other regulations governing clinical investigations or the data from any such trials may not support clearance or approval of the investigational device. Moreover, certainty that clinical trials will meet desired endpoints, produce meaningful or useful data and be free of unexpected adverse effects, or that the FDA will accept the validity of foreign clinical study data (if applicable) cannot be assured, and such uncertainty could preclude or delay market clearance or authorizations resulting in significant financial costs and reduced revenue.
+We are also subject to numerous post-marketing regulatory requirements, which include quality system regulations related to the manufacture of our devices, labeling regulations and medical device reporting ( MDR ) regulations. The last of these regulations requires us to report to the FDA if our devices cause or contribute to a death or serious injury, or malfunction in a way that would likely cause or contribute to a death or serious injury if the malfunction recurred. If we fail to comply with present or future regulatory requirements that are applicable to us, we may be subject to enforcement action by the FDA, which may include any of the following sanctions:
+ untitled letters, warning letters, fines, injunctions, consent decrees and civil penalties;
+ customer notification, or orders for repair, replacement or refunds;
+ voluntary or mandatory recall or seizure of our current or future products;
+ administrative detention by the FDA of medical devices believed to be adulterated or misbranded;
+ operating restrictions, suspension or shutdown of production;
+ refusal of our requests for 510(k) clearance or PMA of new products, new intended uses or modifications to existing products;
+ rescission of 510(k) clearance or suspension or withdrawal of PMAs that have already been granted; and
+ criminal prosecution.
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+The occurrence of any of these events may have a material adverse effect on our business, financial condition and results of operations.
+Our employees, independent contractors, consultants, manufacturers and suppliers may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements.
+We are exposed to the risk that our employees, independent contractors, consultants, manufacturers and suppliers may engage in fraudulent or illegal activity. Misconduct by these parties could include intentional, reckless and/or negligent conduct or disclosure of unauthorized activities to us that violates: (i) the laws of the FDA and other similar foreign regulatory bodies, including those laws 
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+requiring the reporting of true, complete and accurate information to such regulators; (ii) manufacturing standards; (iii) healthcare fraud and abuse laws in the United States and similar foreign fraudulent misconduct laws; or (iv) laws that require the true, complete and accurate reporting of financial information or data. These laws may impact, among other things, future sales, marketing and education programs. In particular, the promotion, sales and marketing of healthcare items and services, as well as certain business arrangements in the healthcare industry, are subject to extensive laws designed to prevent fraud, kickbacks, self-dealing and other abusive practices. These laws and regulations may restrict or prohibit a wide range of pricing, discounting, marketing and promotion, structuring and commissions, certain customer incentive programs and other business arrangements generally. Activities subject to these laws also involve the improper use of information obtained in the course of patient recruitment for clinical trials.
+We adopted a code of business conduct and ethics in connection with the Business Combination. It is not always possible to identify and deter misconduct by our employees and other third parties, and the precautions we take to detect and prevent these activities may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such laws or regulations. If any such actions are instituted against us and we are not successful in defending ourselves or asserting our rights, those actions could result in the imposition of significant fines or other sanctions, including the imposition of civil, criminal and administrative penalties, damages, monetary fines, disgorgement, individual imprisonment, additional integrity reporting and oversight obligations, possible exclusion from participation in Medicare, Medicaid and other federal healthcare programs, contractual damages, reputational harm, diminished profits and future earnings and curtailment of operations, any of which could adversely affect our ability to operate our business and our results of operations. Whether or not we are successful in defending against any such actions or investigations, we could incur substantial costs, including legal fees, and divert the attention of management in defending ourselves against any of these claims or investigations, which could have a material adverse effect on our business, financial condition and results of operations.
+There is no guarantee that the FDA will grant 510(k) clearance or PMA approval of our future products, and failure to obtain necessary clearances or approvals for our future products would adversely affect our ability to grow our business.
+Some of our new or modified products will require FDA clearance of a 510(k) notification or FDA approval of a PMA application. The FDA may refuse our requests for 510(k) clearance or PMA of new products or may not clear or approve these products for the indications that are necessary or desirable for successful commercialization. Early stage review may also result in delays or other issues. For example, the FDA has issued guidance intended to explain the procedures and criteria used in assessing whether 510(k) and PMA submissions should be accepted for substantive review. Under the Refuse to Accept guidance, the FDA conducts an early review against specific acceptance criteria to inform 510(k) and PMA submitters if the submission is administratively complete, or if not, to identify the missing element(s). Submitters are given the opportunity to provide the FDA with any information identified as missing. If the information is not provided within a specified time, the submission will not be accepted for FDA review. The FDA may also change its clearance and approval policies, adopt additional regulations or revise existing regulations, or take other actions that may prevent or delay approval or clearance of our products under development or impact our ability to gain clearance or approval for modifications to our currently approved or cleared products in a timely manner. Significant delays in receiving clearance or approval, or the failure to receive clearance or approval for our new products would have an adverse effect on our ability to expand our business.
+Recent initiatives by the FDA to enhance and modernize various regulatory pathways for device products and its overall approach to safety and innovation in the medical technology industry creates the possibility of changing product development costs, requirements, and other factors and additional uncertainty for our future products and business.
+Regulatory requirements may change in the future in a way that adversely affects us. Any change in the laws or regulations that govern the clearance and approval processes or the post-market compliance requirements relating to our current and future products could make it more difficult and costly to obtain clearance or approval for new products, or to produce, market and distribute existing products.
+For example, the FDA and other government agencies have been focusing on the cybersecurity risks associated with certain medical devices and encouraging device manufacturers to take a more proactive approach to assessing the cybersecurity risks of their devices both during development and on a periodic basis after the devices are in commercial distribution. These regulatory efforts could lead to new FDA requirements in the future or additional product liability or other litigation risks if any of our products is considered to be susceptible to third-party tampering. In December 2016, Congress passed the 21st Century Cures Act, which made multiple changes to the FDA s rules for medical devices as well as for clinical trials, and in August 2017, Congress passed the 
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+Medical Device User Fee reauthorization package, which affects medical device regulation both pre- and post-approval and could have certain impacts on our business. Since that time, the FDA has announced a series of efforts to modernize and streamline the 510(k) notification and regulatory review process and monitoring post-market safety, and issued a final rule to formalize the De Novo classification process to provide clarity to innovative device developers. Changes in the FDA 510(k) process could make clearance more difficult to obtain, increase delay, add uncertainty and have other significant adverse effects on our ability to obtain and maintain clearance for our products.
+It is unclear at this time whether and how various activities initiated or announced by the FDA to modernize the U.S. medical device regulatory system could affect our business, as some of the FDA s new medical device safety and innovation initiatives have not been formalized and remain subject to change. For example, a 2018 Medical Device Safety Action Plan announced by former FDA Commissioner Gottlieb included a particular focus on post-market surveillance and how to respond when new safety concerns emerge once a product is on the market. The increased attention that the medical technology industry is receiving from FDA leadership that understands the challenging and rapidly changing nature of the U.S. healthcare system creates the possibility of unanticipated regulatory and other potential changes to our products and our overall business. In response to the COVID-19 public health emergency, the FDA s device and diagnostic center leadership has exercised a significant amount of enforcement discretion to meet the medical community s and patients needs for remote monitoring and other innovative solutions that involve digital health products. In December 2021, FDA issued draft guidance documents describing a phased transition process for medical devices that were developed or modified during the course of the pandemic to treat COVID-19 patients or allow greater access to patients, including medical imaging devices that were developed or modified in accordance with FDA s Enforcement Policy for Imaging Systems During the COVID-19 Public Health Emergency. It is unclear how these policies could impact the medical device industry in the future.
+If we fail to obtain regulatory authorizations in other countries for existing products or products under development, we will not be able to commercialize these products in those countries.
+In order for us to market our products in countries outside of the United States, we must comply with extensive safety and quality regulations in other countries regarding the quality, safety and efficacy of our products. These regulations, including the requirements for marketing authorizations, and the time required for regulatory review, vary from country to country. Failure to obtain regulatory authorization in any foreign country in which we plan to market our products may harm our ability to generate revenue and harm our business. Marketing authorization requirements vary between countries and can involve additional product testing and additional administrative review periods. The time required to obtain marketing authorization in other countries might differ from that required to obtain FDA clearance or other marketing authorization. The regulatory process in other countries may include all of the risks detailed above regarding FDA clearance in the United States. Regulatory authorization of a product in one country does not ensure regulatory approval in another, but a failure or delay in obtaining regulatory authorization in one country may negatively impact the regulatory process in others. Failure to obtain regulatory authorization in other countries or any delay or setback in obtaining such authorization could have the same adverse effects described above regarding FDA clearance in the United States.
+The primary regulatory environment in Europe is that of the European Economic Area ( EEA ), which is comprised of the Member States of the European Union, Iceland, Liechtenstein and Norway. We cannot be certain that we will be successful in meeting and continuing to meet the requirements to market a medical device in the EEA in light of the current transition period between the prior system, called the Medical Device Directive ( MDD ), to the current system, called the Medical Device Regulation. The Medical Device Regulation went into force in May 2017 but allowed a three-year transition period until May 2020 for Member States, regulatory authorities, and medical device stakeholders to come into compliance with the new requirements. A one-year delay of the compliance date of the Medical Device Regulation was implemented in response to the COVID-19 pandemic, which made May 2021 the final deadline for industry compliance. Compared to the MDD, the Medical Device Regulation promotes a shift from the pre-approval stage (i.e., the path to CE Marking) to a life-cycle approach and places greater emphasis on clinical data and clinical evaluations to assure the safety and performance of new medical devices. Moreover, the Medical Device Regulation includes elements intended to strengthen the conformity assessment procedures, assert greater control over notified bodies and their standards, increase overall system transparency, and impose more robust device vigilance requirements on manufacturers and distributors.
+Among other changes, many device manufacturers will need to switch notified bodies to one that has received its designation under the Medical Device Regulation, which will require those manufacturers to undergo an audit and have all their documentation reviewed by the new notified body before it can assess their medical device products under the new standards. The new rules and procedures that have been created under the overhauled European regulations will likely result in increased regulatory oversight of all 
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+medical devices marketed in the European Union, and this may, in turn, increase the costs, time and requirements that need to be met in order to place an innovative or high-risk medical device on the EEA market.
+If we, our current or future contract manufacturers, or our current or future component suppliers are unable to manufacture our products in sufficient quantities, on a timely basis, at acceptable costs and in compliance with regulatory and quality requirements, the manufacturing and distribution of our devices could be interrupted, and our product sales and operating results could suffer.
+When producing and distributing commercial medical device products, we, our contract manufacturer, and our component suppliers are required to comply with the FDA s Quality System Regulation ( QSR ), which is a complex regulatory framework that covers the procedures and documentation of the design, testing, production, control, quality assurance, labeling, packaging, sterilization, storage, shipping and servicing of our devices. Compliance with applicable regulatory requirements is subject to continual review and is monitored rigorously through periodic, sometimes unannounced, inspections by the FDA. We cannot assure investors that our facilities or our third-party manufacturers or suppliers facilities would pass any future quality system inspection. Failure of us or our third-party manufacturers and component suppliers to adhere to QSR requirements or take adequate and timely corrective action in response to an adverse quality system inspection finding could delay production of our products and lead to fines, difficulties in obtaining regulatory clearances, recalls, enforcement actions, including injunctive relief or consent decrees, or other consequences, which could have a material adverse effect on our business, financial condition or results of operations. Any such failure, including the failure of our current or any future contract manufacturers, to achieve and maintain the required high manufacturing standards could result in further delays or failures in product testing or delivery, cost overruns, increased warranty costs or other problems that could harm our business and prospects.
+In addition, any of our products shipped internationally are also required to comply with the International Organization for Standardization ( ISO ) quality system standards as well as European Directives and norms in order to produce products for sale in the European Union. In addition, many countries such as Canada and Japan have very specific additional regulatory requirements for quality assurance and manufacturing. If we fail to continue to comply with current good manufacturing requirements, as well as ISO or other regulatory standards, we may be required to cease all or part of our operations until we comply with these regulations. Maintaining compliance with multiple regulators adds complexity and cost to our manufacturing and compliance processes.
+Our current or future products may be subject to product recalls even after receiving FDA clearance or approval. A recall of our products, either voluntarily or at the direction of the FDA, or the discovery of serious safety issues with our products, could have a significant adverse impact on us.
+The FDA and similar governmental bodies in other countries have the authority to require the recall of our products if we or our third party manufacturers fail to comply with relevant regulations pertaining to, among other things, manufacturing practices, labeling, advertising or promotional activities, or if new information is obtained concerning the safety or efficacy of these products. For example, under the FDA s Medical Device Reporting regulations, we are required to report to the FDA any incident in which our marketed products may have caused or contributed to a death or serious injury or in which our marketed products malfunctioned in a manner likely to cause or contribute to death or serious injury if that malfunction were to recur. Repeated adverse events or product malfunctions may result in a voluntary or involuntary product recall, or administrative or judicial seizure or injunction, when warranted. A government-mandated recall may be ordered if the FDA finds that there is a reasonable probability that the device would cause serious, adverse health consequences or death. A voluntary recall by us could occur as a result of any material deficiency in a device, such as manufacturing defects, labeling deficiencies, packaging defects or other failures to comply with applicable regulations. In general, if we decide to make a change to our marketed product, we are responsible for determining whether to classify the change as a recall. It is possible that the FDA could disagree with our initial classification. The FDA requires that certain classifications of recalls be reported to the FDA within 10 working days after the recall is initiated. If a change to a device addresses a violation of the federal Food, Drug, and Cosmetic Act ( FDCA ), that change would generally constitute a medical device recall and require submission of a recall report to the FDA.
+Recalls of any of our products would divert managerial and financial resources and have an adverse effect on our reputation, results of operations and financial condition, which could impair our ability to produce our products in a cost-effective and timely manner in order to meet our customers demands. We may also be subject to product liability claims, be required to bear other costs, or be required to take other actions that may have a negative impact on our future sales and our ability to generate profits. Companies are required to maintain certain records of recalls, even if they are not reportable to the FDA. We may initiate voluntary recalls involving our products in the future that we determine do not require notification to the FDA. If the FDA disagrees with our 
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+determinations, the FDA could require us to report those actions as recalls. A future recall, withdrawal, or seizure of any product could materially and adversely affect consumer confidence in our brands, lead to decreased demand for our products and negatively affect our sales. In addition, the FDA could take enforcement action for failing to report recalls when they were conducted by us or one of our agents.
+We may be subject to enforcement action if we engage in improper or off-label marketing or promotion of our commercial medical device products, including fines, penalties and injunctions.
+Our promotional materials and training methods must comply with FDA and other applicable laws and regulations, including the prohibition of the promotion of unapproved, or off-label, uses of lawfully marketed medical device products. Physicians may, however, use our commercial products off-label, as the FDA does not restrict or regulate a physician s practice of medicine. Medical device manufacturers and distributors are permitted to promote their products in a way that is consistent with the FDA-authorized labeling and indications for use. However, if the FDA determines that our promotional materials or training materials promote a 510(k)-cleared or approved medical device in a manner inconsistent with our labeling, the agency could request that we modify our training or promotional materials or subject us to regulatory or enforcement actions, including the issuance of an Untitled Letter, a Warning Letter, injunction, seizure, civil fine or criminal penalties. In addition to ensuring that the claims we make are consistent with our regulatory clearances or approvals, the FDA also ensures that promotional labeling for all regulated medical devices is neither false nor misleading.
+It is also possible that other federal, state or foreign enforcement authorities might take action if they consider our promotional or training materials to constitute promotion of an off-label use, which could result in significant fines or penalties under other statutory authorities, such as laws prohibiting false claims for reimbursement. In that event, our reputation could be damaged, and adoption of our products could be impaired. Although our policy is to refrain from making statements or from disseminating promotional material that could be considered off-label promotion of our commercial medical device products, the FDA or another regulatory agency could disagree and conclude that we have engaged in off-label promotion. In addition, the off-label use of our products may increase the risk of product liability claims. Product liability claims are expensive to defend and could divert our management s attention, result in substantial damage awards against us, and harm our reputation. Recent court decisions have impacted the FDA s enforcement activity regarding off-label promotion in light of First Amendment considerations, although there are still significant risks in this area in part due to the potential False Claims Act exposure. Further, this area is subject to ongoing policy changes at the federal level, resulting in some degree of uncertainty for regulated businesses. For example, in August 2021 the FDA issued a final rule revising the agency s regulation governing the types of evidence relevant to determining the intended use of a drug or device under the FDCA, which has significant implications for when a manufacturer or distributor has engaged in off-label marketing.
+Digital marketing and social media efforts may expose us to additional regulatory scrutiny, including from the Federal Trade Commission (the FTC ) and other consumer protection agencies and regulators.
+In addition to the laws and regulations enforced by the FDA, advertising for various services and for non-restricted medical devices is subject to federal truth-in-advertising laws enforced by the FTC, as well as comparable state consumer protection laws. Our efforts to promote prescription medical device products via social media initiatives may subject us to additional scrutiny of our practices. For example, the FTC and other consumer protection agencies scrutinize all forms of advertising (whether in digital or traditional formats) for business services, consumer-directed products, and non-restricted medical devices to ensure that advertisers are not making false, misleading or unsubstantiated claims or failing to disclose material relationships between the advertiser and its products endorsers, among other potential issues. The FDA oversees the advertising and promotional labeling for restricted medical devices and ensures, among other things, that there is effective communication of, and a fair and balanced presentation of, the risks and benefits of such high-risk medical devices.
+Under the Federal Trade Commission Act ( FTC Act ), the FTC is empowered, among other things, to (a) prevent unfair methods of competition and unfair or deceptive acts or practices in or affecting commerce; (b) seek monetary redress and other relief for conduct injurious to consumers; and (c) gather and compile information and conduct investigations relating to the organization, business, practices, and management of entities engaged in commerce. The FTC has very broad enforcement authority, and failure to abide by the substantive requirements of the FTC Act and other consumer protection laws can result in administrative or judicial penalties, including injunctions affecting the manner in which we would be able to market services or products in the future, or criminal prosecution. We plan to increase our advertising activities that may be subject to these federal and state truth-in-advertising laws. Any actual or perceived non-compliance with those laws could lead to an investigation by the FTC or a comparable state 
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+agency, or could lead to allegations of misleading advertising by private plaintiffs. Any such action against us could disrupt our business operations, cause damage to our reputation, and result in a material adverse effects on our business.
+Because we do not require extensive training for users of our current products, although they are limited under the FDA s marketing clearances to use by, and that images generated from the scanner be interpreted by, trained healthcare practitioners, there exists a potential for misuse of these products, misinterpretation of images by untrained professionals or misuse of these products by untrained professionals, which could ultimately harm our reputation and business.
+Federal regulations allow us to sell our medical device products to or on the order of practitioners licensed by law to use or order the use of a prescription device. The definition of licensed practitioners varies from state to state. As a result, our current products may be purchased or operated by physicians with varying levels of training and, in many states, by non-physicians, including nurse practitioners, chiropractors and technicians. The FDA clearances of the products require interpretation of images by trained physicians and use of that information in determining a diagnosis. Outside the United States, many jurisdictions do not require specific qualifications or training for purchasers, or operators or interpreters, of medical device products. We do not supervise the procedures performed with our products, nor can we require that direct medical supervision occur. Although product training is offered, we do not require purchasers or operators of our non-invasive products to attend training sessions. The lack of required training and the purchase and use of our non-invasive products by non-physicians may result in product misuse and adverse treatment outcomes, which could harm our reputation and expose us to costly product liability litigation.
+We are subject to federal, state and foreign laws prohibiting kickbacks and false or fraudulent claims, and other fraud and abuse laws, transparency laws, and other healthcare laws and regulations, which, if violated, could subject us to substantial penalties. Additionally, any challenge to or investigation into our practices under these laws could cause adverse publicity and be costly to respond to, and thus could harm our business.
+Our relationships with customers and third-party payors are subject to broadly applicable fraud and abuse and other healthcare laws and regulations that may constrain our sales, marketing and other promotional activities by limiting the kinds of financial arrangements, including sales programs and certain customer and product support programs, we may have with hospitals, physicians or other purchasers of medical devices. Other federal and state laws generally prohibit individuals or entities from knowingly presenting, or causing to be presented, claims for payment from Medicare, Medicaid, or other third-party payors that are false or fraudulent, or are for items or services that were not provided as claimed. These laws include, among others, the federal healthcare Anti-Kickback Statute, the federal civil False Claims Act, other federal healthcare false statement and fraud statutes, the Open Payments program, the Civil Monetary Penalties Law, and analogous fraud and abuse and transparency laws in most states, as described in Business of Hyperfine - Government Regulation. Although the federal laws generally apply only to products or services for which payment may be made by a federal healthcare program, state laws often apply regardless of whether federal funds may be involved.
+While we believe and strive to ensure that our business arrangements with third parties and other activities and programs comply with all applicable laws, these laws are complex, and our activities may be found not to be compliant with one or more of these laws, which may result in significant civil, criminal and/or administrative penalties, fines, damages and exclusion from participation in federal healthcare programs. Even an unsuccessful challenge or investigation into our practices could cause adverse publicity, and be costly to respond to, and thus could have a material adverse effect on our business, financial condition and results of operations. Our compliance with Medicare and Medicaid regulations may be reviewed by federal or state agencies, including the Office of Inspector General for the U.S. Department of Health and Human Services ( OIG ), Centers for Medicare & Medicaid Services ( CMS ), and the Department of Justice, or may be subject to whistleblower lawsuits under federal and state false claims laws. To ensure compliance with Medicare, Medicaid and other regulations, government agencies conduct periodic audits of the Company to ensure compliance with various supplier standards and billing requirements.
+Similarly, our international operations are subject to the provisions of the FCPA, which prohibits U.S. companies and their intermediaries from making payments in violation of law to non-U.S. government officials for the purpose of obtaining or retaining business or securing any other improper advantage. In many countries, the healthcare professionals that medical device distributors regularly interact with may meet the definition of a foreign official for purposes of the FCPA. International business operations are also subject to various other international anti-bribery laws such as the U.K. Anti-Bribery Act. Despite meaningful measures that we undertake to facilitate lawful conduct, which include training and compliance programs and internal policies and procedures, we may not always prevent unauthorized, reckless or criminal acts by our employees or agents, or employees or agents of businesses or 
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+operations we may acquire. Violations of these laws, or allegations of such violations, could disrupt operations, involve significant management distraction and have a material adverse effect on our business, financial condition and results of operations, among other adverse consequences.
+If we are found to have violated laws protecting the confidentiality of health information, we could be subject to civil or criminal penalties, which could increase our liabilities and harm our reputation or our business.
+There are a number of federal and state laws protecting the confidentiality of certain health information and restricting the use and disclosure of that protected information. In particular, the U.S. Department of Health and Human Services promulgated privacy rules under the Health and Insurance Portability and Accountability Act ( HIPAA ). These privacy rules protect medical records and other personal health information by limiting their use and disclosure, giving individuals the right to access, amend and seek accounting of their own health information and limiting most use and disclosures of health information to the minimum amount reasonably necessary to accomplish the intended purpose. We are not subject to HIPAA, but our customers and research collaborators and other healthcare provider partners are, which means that there are restrictions on our ability to receive and use health information from our healthcare provider partners. If we are found to be in violation of applicable privacy rule requirements, we could subject our customers or healthcare provider partners to civil or criminal penalties, which could increase our liabilities, harm our reputation and have a material adverse effect on our business, financial condition and results of operations.
+We are subject to complex and evolving U.S. and foreign laws and regulations regarding privacy, data protection, and other matters. Many of these laws and regulations are subject to change and uncertain interpretation, and could result in claims, changes to our business practices, monetary penalties, increased cost of operations, or declines in customer growth or engagement, or otherwise harm our business.
+We are subject to a variety of laws and regulations in the United States and abroad that involve matters central to our business, including laws and regulations relating to privacy, data sharing and data protection, artificial intelligence and use of machine learning, rights of publicity, content, intellectual property, advertising, marketing, distribution, data security, data retention and deletion, personal information, electronic contracts and other communications, competition, protection of minors, consumer protection, telecommunications, product liability, taxation, economic or other trade prohibitions or sanctions, corrupt practices, fraud, waste and abuse restrictions, and securities law compliance. The introduction of new products or expansion of our activities in certain jurisdictions may subject us to additional laws and regulations. For example, in addition to data protection laws passed by the federal government, many states and foreign countries have implemented their own data protection laws, some of which may apply simultaneously and conflict with federal law. Many of these laws create consumer rights including the right to know what personal information is collected, the right to know whether the data is sold or disclosed and to whom, the right to request that a company delete personal information collected, the right to opt-out of the sale of personal information and the right to non-discrimination in terms of price or service when a consumer exercises a privacy right. If we fail to comply with these regulations, we could be subject to civil sanctions, including fines and penalties for noncompliance.
+In addition, foreign data protection, privacy, and other laws and regulations can be more restrictive than those in the United States. Data localization laws in some countries generally mandate that certain types of data collected in a particular country be stored and/or processed within that country. We could be subject to audits in Europe and around the world, particularly in the areas of consumer and data protection, as we continue to grow and expand our operations. Legislators and regulators may make legal and regulatory changes, or interpret and apply existing laws, in ways that make our products less useful to customers, require us to incur substantial costs, expose us to unanticipated civil or criminal liability, or cause us to change our business practices. These changes or increased costs could negatively impact our business and results of operations in material ways. For example, the general data privacy regulation ( GDPR ) imposes requirements in the EEA relating to, among other things, consent to process personal data of individuals, the information provided to individuals regarding the processing of their personal data, the security and confidentiality of personal data, notifications in the event of data breaches and use of third party processors. If we fail to comply with these standards, we could be subject to criminal penalties and civil sanctions, including fines and penalties and amounts could be significant.
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+Cybersecurity risks and cyber incidents could result in the compromise of confidential data or critical data systems and give rise to potential harm to customers, remediation and other expenses, expose us to liability under federal or state law, consumer protection laws, or other common law theories, subject us to litigation and federal and state governmental inquiries, damage our reputation, and otherwise be disruptive to our business and operations.
+Cyber incidents can result from deliberate attacks or unintentional events. We collect and store on our networks sensitive information, including intellectual property, proprietary business information and personally identifiable information of individuals, such as our employees and customers. The secure maintenance of this information and technology is critical to our business operations. As a pre-commercial company, Liminal s security infrastructure is evolving consistent with its business operations and security risk profile. Legacy Hyperfine has implemented multiple layers of security measures to protect the confidentiality, integrity and availability of these data and the systems and devices that store and transmit such data. Legacy Hyperfine utilizes current security technologies, including encryption and data depersonalization, and its defenses are monitored and routinely tested. Despite these efforts, threats from malicious persons and groups, new vulnerabilities and advanced new attacks against information systems create risk of cybersecurity incidents. These incidents can include, but are not limited to, gaining unauthorized access to digital systems for purposes of misappropriating assets or sensitive information, corrupting data, or causing operational disruption. Because the techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently and may not immediately produce signs of intrusion, we may be unable to anticipate these incidents or techniques, timely discover them, or implement adequate preventative measures.
+Cybersecurity threats can come from a variety of sources, and may range in sophistication from an individual hacker to malfeasance by employees, consultants or other service providers to state-sponsored attacks. Cyber threats may be generic, or they may be custom-crafted against our information systems. Over the past several years, cyber-attacks have become more prevalent and much harder to detect and defend against. Our network and storage applications, as well as those of our contractors, may be vulnerable to cyber-attack, malicious intrusion, malfeasance, loss of data privacy or other significant disruption and may be subject to unauthorized access by hackers, employees, consultants or other service providers. In addition, hardware, software or applications that we develop or procure from third parties may contain defects in design or manufacture or other problems that could unexpectedly compromise information security. Unauthorized parties may also attempt to gain access to our systems or facilities through fraud, trickery or other forms of deceiving employees, contractors and temporary staff.
+There can be no assurance that we will not be subject to cybersecurity incidents that bypass our security measures, impact the integrity, availability or privacy of health information or other data subject to privacy laws or disrupt our information systems, devices or business, including our ability to deliver services to our users. As a result, cybersecurity, physical security and the continued development and enhancement of our controls, processes and practices designed to protect our enterprise, information systems and data from attack, damage or unauthorized access remain a priority for us. As cyber threats continue to evolve, we may be required to expend significant additional resources to continue to modify or enhance our protective measures or to investigate and remediate any cybersecurity vulnerabilities. The occurrence of any of these events could result in:
+ harm to customers and end-users;
+ business interruptions and delays;
+ the loss, misappropriation, corruption or unauthorized access of data;
+ litigation, including potential class action litigation, and potential liability under privacy, security and consumer protection laws or other applicable laws;
+ reputational damage;
+ increase to insurance premiums; and
+ foreign, federal and state governmental inquiries, any of which could have a material, adverse effect on our financial position and results of operations and harm our business reputation.
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+Security breaches, loss of data and other disruptions could compromise sensitive information related to our business or prevent us from accessing critical information and expose us to liability, which could adversely affect our business and our reputation.
+In the ordinary course of our business, we collect and store sensitive data, and intellectual property and proprietary business information owned or controlled by us or our users. This data encompasses a wide variety of business-critical information, including research and development information, commercial information, and business and financial information. We face four primary risks relative to protecting this critical information: loss of access; inappropriate disclosure; inappropriate modification; and inadequate monitoring of our controls over the first three risks.
+The secure processing, storage, maintenance, and transmission of this critical information is vital to our operations and business strategy, and we devote significant resources to protecting such information. Although we take measures to protect sensitive information from unauthorized access or disclosure, our information technology and infrastructure may be vulnerable to attacks by hackers or viruses, breaches, interruptions due to employee error, malfeasance, lapses in compliance with privacy and security mandates, or other disruptions. Any such breach or interruption could compromise our networks and the information stored there could be accessed by unauthorized parties, publicly disclosed, lost, or stolen.
+Any such security breach or interruption, as well as any action by us or our employees or contractors that might be inconsistent with the rapidly evolving data privacy and security laws and regulations applicable within the United States and elsewhere where we conduct business, could result in enforcement actions by U.S. states, the U.S. federal government or foreign governments, liability or sanctions under data privacy laws that protect personally identifiable information, regulatory penalties, other legal proceedings such as but not limited to private litigation, the incurrence of significant remediation costs, disruptions to our development programs, business operations and collaborations, diversion of management efforts and damage to us and our brands reputation, which could harm our business and operations. Because of the rapidly moving nature of technology and the increasing sophistication of cybersecurity threats, our measures to prevent, respond to and minimize such risks may be unsuccessful.
+With respect to medical information, we follow HIPAA guidelines when applicable and separate personal information from medical information, and employ additional measures such as encryption tools to protect the privacy of our users and medical data. However, hackers may attempt to penetrate our computer systems, and, if successful, misappropriate personal or confidential business information. In addition, an associate, contractor or other third party with whom we do business may attempt to circumvent our security measures in order to obtain such information, and may purposefully or inadvertently cause a breach involving such information. While we continue to implement additional protective measures to reduce the risk of and detect cyber incidents, cyber-attacks are becoming more sophisticated and frequent, and the techniques used in such attacks change rapidly.
+In addition, the European Parliament and the Council of the European Union adopted the comprehensive GDPR in 2016 to replace the current European Union Data Protection Directive and related country-specific legislation. The GDPR took effect in May 2018 and governs the collection and use of personal data in the European Union. The GDPR, which is wide-ranging in scope, imposes requirements relating to the consent of the individuals to whom the personal data relates, the information provided to the individuals, the security and confidentiality of the personal data, data breach notification and the use of third party processors in connection with the processing of the personal data. The GDPR also imposes strict rules on the transfer of personal data out of the European Union to the United States, enhances enforcement authority and imposes large penalties for noncompliance, including the potential for fines of up to 20 million or 4% of the annual global revenues of the infringer, whichever is greater. While we comply with the GDPR, including reviewing our security procedures and entering into data processing agreements with relevant contractors, there can be no assurance that as our operations evolve, our efforts to comply or to remain in compliance will be fully successful.
+Further, unauthorized access, loss or dissemination of sensitive personal data, such as health information, could also disrupt our operations, including our ability to conduct research and development activities, process and prepare company financial information, manage various general and administrative aspects of our business and damage our reputation, any of which could adversely affect our business and reputation. In addition, there can be no assurance that we will promptly detect any such disruption or security breach, if at all. To the extent that any disruption or security breach were to result in a loss of or damage to our data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability and the further development of our products could be delayed.
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+Broad-based domestic and international government initiatives to reduce spending, particularly those related to healthcare costs, may reduce reimbursement rates for medical procedures, which will reduce the cost-effectiveness of our products and services.
+Healthcare reforms, changes in healthcare policies and changes to third-party coverage and reimbursements, including legislation enacted reforming the U.S. healthcare system and both domestic and foreign healthcare cost containment legislation, and any future changes to such legislation, may affect demand for our products and services and may have a material adverse effect on our financial condition and results of operations. The ongoing implementation of the Affordable Care Act, in the United States, as well as state-level healthcare reform proposals could reduce medical procedure volumes and impact the demand for medical device products or the prices at which we can sell products. These reforms include a national pilot program on payment bundling to encourage hospitals, physicians and other providers to improve the coordination, quality and efficiency of certain healthcare services through bundled payment models. The impact of this healthcare reform legislation, and practices including price regulation, competitive pricing, comparative effectiveness of therapies, technology assessments, and managed care arrangements are uncertain. There can be no assurance that current levels of reimbursement will not be decreased in the future, or that future legislation, regulation, or reimbursement policies of third parties will not adversely affect the demand for our products and services or our ability to sell products and provide services on a profitable basis. The adoption of significant changes to the healthcare system in the United States, the EEA or other jurisdictions in which we may market our products and services, could limit the prices we are able to charge for our products and services or the amounts of reimbursement available for our products and services, could limit the acceptance and availability of our products and services, reduce medical procedure volumes and increase operational and other costs.
+In addition, following judicial and Congressional challenges to certain aspects of the Affordable Care Act, certain sections of the Affordable Care Act, as a result, have not been fully implemented or were effectively repealed. However, following several years of litigation in the federal courts, in June 2021, the U.S. Supreme Court upheld the Affordable Care Act when it dismissed a legal challenge to the constitutionality of the Affordable Care Act. Further legislative and regulatory changes under the Affordable Care Act remain possible, although the new Democrat-led presidential administration has been taking steps to strengthen the Affordable Care Act and the 117th Congress is not expected to have the same interest in repealing the law, in part due to the healthcare economic impacts of the ongoing COVID-19 pandemic. In addition to the Affordable Care Act, there have been and will likely continue to be other federal and state changes that affect the provision of healthcare goods and services in the United States. While we are unable to predict what changes may ultimately be enacted, to the extent that future changes affect how our products and services are paid for and reimbursed by government and private payers, our business could be adversely impacted. Moreover, complying with any new legislation or reversing changes implemented under the Affordable Care Act could be time-intensive and expensive, resulting in a material adverse effect on the business.
+Risks Related to our Intellectual Property
+If we are unable to obtain and maintain and enforce sufficient intellectual property protection for our products and technology, or if the scope of the intellectual property protection obtained is not sufficiently broad, our competitors could develop and commercialize products similar or identical to ours, and our ability to successfully commercialize our products may be impaired.
+We rely on patent protection as well as trademark, copyright, trade secret and other intellectual property right protection and contractual restrictions to protect our proprietary products and technologies, all of which provide limited protection and may not adequately protect our rights or permit us to gain or keep any competitive advantage. If we fail to obtain, maintain and sufficiently enforce our intellectual property, third parties may be able to compete more effectively against us. In addition, we may incur substantial litigation costs in our attempts to recover damages or restrict use of our intellectual property.
+To the extent our intellectual property offers inadequate protection, or is found to be invalid or unenforceable, we would be exposed to a greater risk of direct competition. If our intellectual property does not provide adequate coverage against our competitors products, our competitive position could be adversely affected, as could our business, financial condition, results of operations and prospects. Both the patent application process and the process of managing patent and other intellectual property disputes can be time-consuming and expensive.
+Our success depends in large part on our and our licensors ability to obtain and maintain protection of the intellectual property we may own solely or jointly with, or license from, third parties, particularly patents, in the United States and other countries directed to our products and technologies. We apply for patents covering our products and technologies and uses thereof, as we deem appropriate. However, obtaining and enforcing patents is costly, time-consuming and complex, and we may fail to apply for patents on 
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+important products and technologies in a timely fashion or at all, or we may fail to apply for patents in potentially relevant jurisdictions. We may not be able to file and prosecute all necessary or desirable patent applications, or maintain, enforce and license any patents that may issue from such patent applications, at a reasonable cost or in a timely manner or in all jurisdictions. It is also possible that we will fail to identify patentable aspects of our research and development output before it is too late to obtain patent protection. Moreover, we may not develop additional proprietary products, methods and technologies that are patentable. We may not have the right to control the preparation, filing and prosecution of patent applications, or to maintain the rights to patents licensed from or to third parties. Therefore, these patents and applications may not be prosecuted, obtained and enforced by such third parties in a manner consistent with the best interests of our business.
+In addition, the patent position of life sciences and medical technology companies generally is highly uncertain, involves complex legal and factual questions, and has been the subject of much litigation in recent years. Changes in either the patent laws or in interpretations of patent laws in the United States or other countries or regions may diminish the value of our intellectual property. As a result, the issuance, scope, validity, enforceability, and commercial value of our patent rights presents some degree of uncertainty. It is possible that some of our pending patent applications will not result in issued patents in a timely fashion or at all, and even if patents are granted, they may not provide a basis for intellectual property protection of commercially viable products or services, may not provide any competitive advantages, or may be challenged, narrowed and/or invalidated by third parties. There exists some degree of uncertainty over the breadth of claims that may be allowed or enforced in our patents or in third-party patents. It is possible that third parties will attempt to design around our current or future patents such that we cannot prevent such third parties from using similar technologies and commercializing similar products to compete with us. Some of our owned or licensed patents or patent applications may be challenged at a future point in time and we may not be successful in defending any such challenges made against our patents or patent applications. Any successful third-party challenge to our patents could result in the narrowing, unenforceability or invalidity of such patents and increased competition to our business. The outcome of patent litigation or other proceedings can be uncertain, and any attempt by us to enforce our patent rights against others or to challenge the patent rights of others may not be successful, or, regardless of success, may take substantial time and result in substantial cost, and may divert our efforts and attention from other aspects of our business. Any of the foregoing events could have a material adverse effect on our business, financial condition and results of operations.
+The U.S. law relating to the patentability of certain inventions in the life sciences and medical technology industry is uncertain and rapidly changing, which may adversely impact our existing patents or our ability to obtain patents in the future.
+Changes in either the patent laws or interpretation of the patent laws in the United States or in other jurisdictions could increase the uncertainties and costs surrounding the prosecution of patent applications and the enforcement or defense of issued patents. For instance, under the Leahy-Smith America Invents Act (the America Invents Act ), enacted in September 2011, the United States transitioned to a first inventor to file system in which, assuming that other requirements for patentability are met, the first inventor to file a patent application is entitled to the patent on an invention regardless of whether a third party was the first to invent the claimed invention. These changes include allowing third-party submission of prior art to the United States Patent and Trademark Office ( USPTO ) during patent prosecution and additional procedures to challenge the validity of a patent through USPTO administered post-grant proceedings, including post-grant review, inter partes review, and derivation proceedings. The America Invents Act and its implementation could increase the uncertainties and costs surrounding the prosecution of our patent applications and the enforcement or defense of our issued patents, all of which could have a material adverse effect on our business, financial condition, results of operations and prospects.
+Various courts, including the U.S. Supreme Court, have rendered decisions that impact the scope of patentability of certain inventions or discoveries relating to life sciences and medical technology. Specifically, these decisions stand for the proposition that patent claims that recite laws of nature, natural phenomena, and abstract ideas are not themselves patentable unless those patent claims have sufficient additional features that provide practical assurance that the processes are genuine inventive applications of those laws, phenomena, and abstract ideas rather than patent drafting efforts designed to monopolize the law of nature, natural phenomenon, or abstract idea itself. What constitutes a sufficient additional feature is somewhat uncertain. Furthermore, in view of these decisions, since December 2014, the USPTO has published and continues to publish revised guidelines for patent examiners to apply when examining process claims for patent eligibility.
+In addition, U.S. Supreme Court rulings have narrowed the scope of patent protection available in certain circumstances and weakened the rights of patent owners in certain situations. In addition to some degree of uncertainty with regard to Company s ability to obtain patents in the future, this combination of events has created a degree of uncertainty with respect to the value of patents, once 
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+obtained. Depending on relevant laws enacted by the U.S. Congress, and decisions by the federal courts and the USPTO, the laws and regulations governing patents could change in unpredictable ways that may have a material adverse effect on our ability to obtain new patents and to defend and enforce our existing patents and patents that we might obtain in the future.
+Our patent portfolio may be negatively impacted by current uncertainties in the state of the law, new court rulings or changes in guidance or procedures issued by the USPTO or other similar patent offices around the world. From time to time, the U.S. Supreme Court, other federal courts, the U.S. Congress or the USPTO may change the standards of patentability, scope and validity of patents within the life sciences and medical technology and any such changes, or any similar adverse changes in the patent laws of other jurisdictions, could have a negative impact on our business, financial condition, prospects and results of operations.
+We may not be able to protect our intellectual property rights throughout the world.
+The laws of some foreign countries do not offer intellectual property rights to the same extent as the laws of the United States, and we and our licensors may encounter difficulties in obtaining, enforcing and defending such rights in foreign jurisdictions. Consequently, we and our licensors may not be able to prevent third parties from practicing our or our licensors inventions in some or all countries outside the United States, or from selling or importing products made using our or our licensors inventions in other jurisdictions. Competitors and other third parties may use our technologies in jurisdictions where we have not obtained patent protection to develop their own products and technologies and may also export infringing products to territories where we have patent protection, but enforcement practices or laws are not as strong as those in the United States. These products may compete with our products. Our and our licensors patents or other intellectual property rights may not be effective or sufficient to prevent them from competing. In addition, certain countries have compulsory licensing laws under which a patent owner may be compelled to grant licenses to other parties. Furthermore, many countries limit the enforceability of patents against other parties, including government agencies or government contractors. In these countries, the patent owner may have limited remedies, which could materially diminish the value of any patents.
+Many companies have encountered significant problems in protecting and defending intellectual property rights in foreign jurisdictions. The legal systems of certain other countries are not as developed or as favorable as the United States in the enforcement of patents and other intellectual property rights, which could make it difficult for us to stop the misappropriation or other violations of our intellectual property rights including infringement of our patents in such countries. The legal systems in certain countries may also favor state-sponsored companies or companies headquartered in particular jurisdictions over our first-in-time patents and other intellectual property rights. The absence of harmonized intellectual property protection laws and effective enforcement makes it difficult to ensure consistent respect for patent, trade secret, and other intellectual property rights on a worldwide basis. As a result, it is possible that we will not be able to enforce our rights against third parties that misappropriate our proprietary technology in those countries.
+Proceedings to enforce our or our licensors patent rights in foreign jurisdictions could result in substantial cost and divert our efforts and attention from other aspects of our business, could put us and our licensors patents at risk of being invalidated or interpreted narrowly and our and our licensors patent applications at risk of not issuing, and could provoke third parties to assert claims against us. We and our licensors may not prevail in any lawsuits that we or our licensors initiate, or that are initiated against us or our licensors, and the damages or other remedies awarded, if any, may not be commercially meaningful. In addition, changes in the law and legal decisions by courts in the United States and foreign countries may affect our ability to obtain adequate protection for our products, services and other technologies and the enforcement of intellectual property. Accordingly, our efforts to enforce our intellectual property rights around the world may be inadequate to obtain a significant commercial advantage from the intellectual property that we develop or license. Any of the foregoing events could have a material adverse effect on our business, financial condition, results of operations and prospects.
+Issued patents covering our products could be found invalid or unenforceable if challenged.
+Our owned and licensed patents and patent applications may be subject to validity, enforceability and priority disputes. The issuance of a patent is not conclusive as to its inventorship, scope, validity or enforceability. Some of our patents or patent applications (including licensed patents and patent applications) may be challenged at a future point in time in opposition, derivation, reexamination, inter partes review, post-grant review or interference or other similar proceedings, as applicable. Any successful third-party challenge to our patents in this or any other proceeding could result in the unenforceability or invalidity of such patents, which may lead to increased competition to our business, which could have a material adverse effect on our business, financial condition, 
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+results of operations and prospects. In addition, if we or our licensors initiate legal proceedings against a third party to enforce a patent covering our products, the defendant could counterclaim that such patent covering our products, as applicable, is invalid and/or unenforceable. In patent litigation in the United States, defendant counterclaims alleging invalidity or unenforceability are commonplace. There are numerous grounds upon which a third party can assert invalidity or unenforceability of a patent. Grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, including lack of novelty, obviousness or non-enablement. Grounds for an unenforceability assertion could be an allegation that someone connected with prosecution of the patent intentionally withheld relevant information from the relevant patent office, or knowingly made a misleading statement, during prosecution. Third parties may also raise similar claims before administrative bodies in the United States or abroad, even outside the context of litigation. Such mechanisms include ex parte re-examination, inter partes review, post-grant review, derivation and equivalent proceedings in non-U.S. jurisdictions, such as opposition proceedings. Such proceedings could result in revocation of or amendment to our patents in such a way that they no longer cover and protect our products. With respect to the validity of our patents, for example, we cannot be certain that there is no invalidating prior art of which we, our licensors, our patent counsel and the patent examiner were unaware during prosecution. The outcome following legal assertions of invalidity and unenforceability during patent litigation is unpredictable. If a defendant or other third party were to prevail on a legal assertion of invalidity or unenforceability, we would lose at least part, and perhaps all, of the patent protection on certain aspects of our products and technologies, which could have a material adverse effect on our business, financial condition, results of operations and prospects. In addition, if the breadth or strength of protection provided by our patents and patent applications is threatened, regardless of the outcome, it could dissuade companies from collaborating with us to license intellectual property, or develop or commercialize current or future products.
+We may not be aware of all third-party intellectual property rights potentially relating to our products. Publications of discoveries in the scientific literature often lag behind the actual discoveries, and patent applications in the United States and other jurisdictions are typically not published until approximately 18 months after filing or, in some cases, not until such patent applications issue as patents. We might not have been the first to make the inventions covered by each of our pending patent applications and we might not have been the first to file patent applications for these inventions. To determine the priority of these inventions, we may have to participate, as applicable, in interference proceedings, derivation proceedings or other post-grant proceedings declared by the USPTO, or other similar proceedings in non-U.S. jurisdictions that could result in substantial cost to us and the loss of valuable patent protection. The outcome of such proceedings is uncertain. No assurance can be given that other patent applications will not have priority over our patent applications. In addition, changes to the patent laws of the United States allow for various post-grant opposition proceedings that have not been extensively tested, and their outcome is therefore uncertain. Furthermore, if third parties bring these proceedings against our patents, regardless of the merit of such proceedings and regardless of whether we are successful, we could experience significant costs and our management may be distracted.
+Any of the foregoing events could have a material adverse effect on our business, financial condition, results of operations and prospects.
+If we are unable to protect the confidentiality of our trade secrets, the value of our technology could be materially adversely affected and our business could be harmed.
+We rely heavily on trade secrets and confidentiality agreements to protect our unpatented know-how, technology and other confidential proprietary information, and to maintain our competitive position. However, trade secrets and know-how can be difficult to protect. In particular, we anticipate that with respect to our technologies, these trade secrets and know-how will over time be disseminated within the industry through independent development, the publication of journal articles describing the methodology, and the movement of personnel from academic to industry scientific positions.
+In addition to pursuing patents on our technology, we take steps to protect our intellectual property and proprietary technology by entering into agreements, including confidentiality agreements, non-disclosure agreements and intellectual property assignment agreements, with our employees, consultants, academic institutions, corporate partners and, when needed, our advisers. However, we cannot be certain that such agreements have been entered into with all relevant parties, and we cannot be certain that our trade secrets and other confidential proprietary information will not be disclosed or that competitors or other third parties will not otherwise gain access to our trade secrets or independently develop substantially equivalent information and techniques. For example, any of these parties may breach the agreements and disclose our proprietary information, including our trade secrets, and we may not be able to obtain adequate remedies for such breaches. Such agreements may not be enforceable or may not provide meaningful protection for our trade secrets or other proprietary information in the event of unauthorized use or disclosure or other breaches of the agreements, 
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+and we may not be able to prevent such unauthorized disclosure, which could materially and adversely impact our ability to establish or maintain a competitive advantage in the market, and our business, financial condition, results of operations and prospects.
+Monitoring unauthorized disclosure is difficult, and we do not know whether the steps we have taken to prevent such disclosure are, or will be, adequate. If we was to enforce a claim that a third party had wrongfully obtained and was using our trade secrets, it would be expensive and time-consuming, it could distract our personnel, and the outcome would be unpredictable. In addition, courts outside the United States may be less willing to protect trade secrets or may not recognize certain claims of intellectual property infringement.
+We also seek to preserve the integrity and confidentiality of our confidential proprietary information by maintaining physical security of our premises and physical and electronic security of our information technology systems, but it is possible that these security measures could be breached. If any of our confidential proprietary information were to be lawfully obtained or independently developed by a competitor or other third party, absent patent and copyright protection, we would have no right to prevent such competitor from using that technology or information to compete with us, which could harm our competitive position. Competitors or third parties could purchase our products and attempt to replicate some or all of the competitive advantages we derives from our development efforts, design around our protected technology, develop their own competitive technologies that fall outside the scope of our intellectual property rights or independently develop our technologies without reference to our trade secrets. If any of our trade secrets were to be disclosed to or independently discovered by a competitor or other third party, it could materially and adversely affect our business, financial condition, results of operations and prospects.
+We may be subject to claims challenging the inventorship and ownership of our patents and other intellectual property.
+We or our licensors may be subject to claims that former employees, collaborators or other third parties have an interest in our owned or in-licensed patents, trade secrets or other intellectual property as an inventor or co-inventor. For example, we or our licensors may have inventorship disputes arise from alleged inventors such as employees, consultants, advisors or others who are involved in developing our products, some of whom may have conflicting intellectual property ownership obligations. In addition, counterparties to our consulting, sponsored research, software development and other agreements may assert that they have an ownership interest in intellectual property developed under such arrangements. In particular, certain software development agreements pursuant to which certain third parties have developed parts of our proprietary software may not include provisions that expressly assign to us ownership of all intellectual property developed for us by such third parties. Furthermore, certain of our sponsored research agreements pursuant to which we provide certain research services for third parties do not assign to us all intellectual property developed under such agreements. As such, we may not have the right to use all such developed intellectual property under such agreements, we may be required to obtain licenses from third parties and such licenses may not be available on commercially reasonable terms or at all, or may be non-exclusive. If we are unable to obtain such licenses and such licenses are necessary for the development, manufacture and commercialization of our products and technologies, we may need to cease the development, manufacture or commercialization of our products and technologies. Litigation may be necessary to defend against these and other claims challenging inventorship of our or our licensors ownership of our owned or in-licensed patents, trade secrets or other intellectual property. If we or our licensors fail in defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights. In such an event, we may be required to obtain licenses from third parties and such licenses may not be available on commercially reasonable terms or at all, or may be non-exclusive. If we are unable to obtain and maintain such licenses, we may need to cease the development, manufacture or commercialization of our products and technologies. Even if we are successful in defending against such claims, litigation could result in substantial costs and loss of time and be a distraction to management and other employees, and certain customers or partners may defer engaging with us until the particular dispute is resolved. Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations and prospects.
+We may not be able to protect and enforce our trademarks and trade names, or build name recognition in our markets of interest thereby harming our competitive position.
+The registered or unregistered trademarks or trade names that we own may be challenged, infringed, circumvented, declared generic or otherwise fail to function as a mark, lapsed or determined to be confusingly similar to or dilutive of other marks. We may not be able to protect our rights in these trademarks and trade names, which we need in order to build name recognition. In addition, third parties have filed, and may in the future file, for registration of trademarks similar or identical to our trademarks, thereby impeding our ability to build brand identity and possibly leading to consumer confusion. If such third parties were to succeed in 
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+registering or developing common law rights in any other trademarks that are similar or identical to our trademarks, and if we are not successful in challenging such rights and defending against challenges to Company s trademarks, we may not be able to use such trademarks to develop brand recognition of our technologies, products or services. In addition, there could be potential trade name or trademark infringement claims brought by owners of other registered trademarks or trademarks that incorporate variations of our registered or unregistered trademarks or trade names. Further, we have and may in the future enter into agreements with owners of such third party trade names or trademarks to avoid potential trademark litigation which may limit our ability to use our trade names or trademarks in certain fields of business. Over the long term, if we are unable to establish name recognition based on our trademarks and trade names, then we may not be able to compete effectively, and our business, financial condition, results of operations and prospects may be adversely affected. Our efforts to enforce or protect our proprietary rights related to trademarks, trade secrets, domain names, copyrights or other intellectual property may be ineffective and could result in substantial costs and diversion of resources. Any of the foregoing events could have a material adverse effect on our business, financial condition and results of operations.
+Patent terms may be inadequate to protect our competitive position on our products for an adequate amount of time.
+Patents have a limited lifespan. In the United States, if all maintenance fees are timely paid, the natural expiration of a utility patent is generally 20 years from its earliest U.S. non-provisional filing date. While extensions may be available, the life of a patent, and the protection it affords, is limited. In the United States, a patent s term may, in certain cases, be lengthened by patent term adjustment, which compensates a patentee for administrative delays by the USPTO in examining and granting a patent, or may be shortened if a patent is terminally disclaimed over a commonly owned patent or a patent naming a common inventor and having an earlier expiration date. Even if patents covering our products are obtained, once the patent life has expired, we may be open to competition from competitive products. If one of our products requires extended development, testing and/or regulatory review, patents protecting such products might expire before or shortly after such products are commercialized. As a result, our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to our products, which could have a material adverse effect on our business, financial condition and results of operations.
+We may be subject to claims that our employees, consultants or independent contractors have wrongfully used or disclosed to us alleged trade secrets of their other clients or former employers, which could subject us to costly litigation.
+As is common in the life sciences and medical industry, we engage the services of consultants and independent contractors to assist us in the development of our products. Many of these consultants and independent contractors were previously employed at, or may have previously or may be currently providing consulting or other services to, universities or other technology, biotechnology or pharmaceutical companies, including our competitors or potential competitors. We may become subject to claims that we, a consultant or an independent contractor inadvertently or otherwise used or disclosed trade secrets or other information proprietary to their former employers or their former or current clients. We may similarly be subject to claims stemming from similar actions of an employee, such as one who was previously employed by another company, including a competitor or potential competitor. Litigation may be necessary to defend against these claims. Even if we are successful in defending against these claims, litigation could result in substantial costs and be a distraction to our management team. If we are not successful we could lose access or exclusive access to valuable intellectual property.
+We may become involved in lawsuits to defend against third-party claims of infringement, misappropriation or other violations of intellectual property rights or to protect or enforce our intellectual property, any of which could be expensive, time consuming and unsuccessful, and may prevent or delay our development and commercialization efforts.
+Our commercial success depends in part on our ability and the ability of future collaborators to develop, manufacture, market and sell our product and use our products and technologies without infringing, misappropriating or otherwise violating the intellectual property rights of third parties. There is a substantial amount of litigation involving patents and other intellectual property rights in the life sciences and medical technology sector, as well as administrative proceedings for challenging patents, including interference, derivation, inter partes review, post grant review, and reexamination proceedings before the USPTO, or oppositions and other comparable proceedings in foreign jurisdictions. We may be exposed to, or threatened with, future litigation by third parties having patent or other intellectual property rights alleging that our products, manufacturing methods, software and/or technologies infringe, misappropriate or otherwise violate their intellectual property rights. Numerous issued patents and pending patent applications that are owned by third parties exist in the fields in which we are developing our products and technologies. It is not always clear to industry participants, including us, the claim scope that may issue from pending patent applications owned by third parties or which patents 
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+cover various types of products, technologies or their methods of use or manufacture. Thus, because of the large number of patents issued and patent applications filed in our fields, there may be a risk that third parties, including our competitors, may allege they have patent rights encompassing our products, technologies or methods and that we are employing technology protected by such patent rights without authorization.
+If third parties, including our competitors, believe that our products or technologies infringe, misappropriate or otherwise violate their intellectual property rights, such third parties may seek to enforce against us their intellectual property rights, including patent rights, by filing against us an intellectual property-related lawsuit, including a patent infringement lawsuit. Even if we believe third-party intellectual property claims are without merit, there is no assurance that a court would find in our favor on questions of infringement, validity, enforceability, or priority. If any third parties were to assert these or any other patents against us and we are unable to successfully defend against any such assertions, we may be required, including by court order, to cease the development and commercialization of the infringing products or technology and we may be required to redesign such products and technologies so they do not infringe such patents, which may not be possible or may require substantial monetary expenditures and time. We could also be required to pay damages, which could be significant, including treble damages and attorneys fees if we are found to have willfully infringed such patents. We could also be required to obtain a license to such patents in order to continue the development and commercialization of the infringing product or technology. However, such a license may not be available on commercially reasonable terms or at all, including because certain of these patents may be held by or exclusively licensed to our competitors. Even if such a license were available, it may require substantial payments or cross-licenses under our intellectual property rights, and it may only be available on a nonexclusive basis, in which case third parties, including our competitors, could use the same licensed intellectual property to compete with us. Any of the foregoing could have a material adverse effect on our business, financial condition, results of operation and prospects.
+We may choose to challenge, including in connection with any allegation of patent infringement by a third party, the patentability, validity, ownership or enforceability of any third-party patent that we believe may have applicability in our field, and any other third-party patent that may at some future time possibly be asserted against us. Such challenges may be brought either in court or by requesting that the USPTO, European Patent Office ( EPO ), or other foreign patent offices review the patent claims, such as in an ex-parte reexamination, inter partes review, post-grant review proceeding or opposition proceeding or other similar proceedings. However, there can be no assurance that any such challenge by us or any third party will be successful. Even if such proceedings are successful, these proceedings are expensive and may consume our time or other resources, distract our management and technical personnel, and the costs of these opposition proceedings could be substantial. There can be no assurance that our defenses of non-infringement, invalidity or unenforceability will succeed.
+Third parties, including our competitors, could be infringing, misappropriating or otherwise violating our solely owned and/or in-licensed intellectual property rights. Monitoring unauthorized use of intellectual property is difficult and costly. We may not be able to detect unauthorized use of, or take appropriate steps to enforce, our intellectual property rights. From time to time, we seek to analyze our competitors products and services, and may in the future seek to enforce our rights based on potential infringement, misappropriation or violation of our intellectual property. However, the steps we take to protect our intellectual property rights may not be adequate to enforce our rights against such infringement, misappropriation or violation of our intellectual property. Any inability to meaningfully enforce our intellectual property rights could harm our ability to compete and reduce demand for our products and technologies.
+Litigation proceedings may be necessary for us to enforce our patent and other intellectual property rights. In any such proceeding, a court may refuse to stop the other party from using the technology at issue on the grounds that our owned and in-licensed patents do not cover the technology in question. Further, in such a proceeding, the defendant could counterclaim that our intellectual property is invalid or unenforceable and the court may agree, in which case we could lose valuable intellectual property rights, which could allow third parties to commercialize technology or products similar to ours and compete directly with us, without payment to us. Alternatively or additionally such a proceeding could result in requiring us to license rights from the prevailing party in order to be able to manufacture or commercialize our products without infringing such party s intellectual property rights, and if we are unable to obtain such a license, we may be required to cease commercialization of our products and technologies, any of which could have a material adverse effect on our business, financial condition, results of operations and prospects. The outcome in any such proceeding is somewhat unpredictable.
+Regardless of whether we are defending against or asserting an intellectual property-related claim in an intellectual property-related proceeding that may be necessary in the future, and regardless of outcome, substantial costs and diversion of resources may 
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+result which could have a material adverse effect on our business, financial condition, results of operations and prospects. Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation. In addition, there could be public announcements of the results of hearings, motions, or other interim proceedings or developments, and if securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the price of our Class A common stock. Some of our competitors and other third parties may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their greater financial resources and more mature and developed intellectual property portfolios. We may not have sufficient financial or other resources to adequately conduct these types of litigation or proceedings. Any of the foregoing, or any uncertainties resulting from the initiation and continuation of any litigation, could have a material adverse effect on our business, financial condition, results of operations and prospects. Claims that we have misappropriated the confidential information or trade secrets of third parties could have a similar adverse effect on our business, financial condition, results of operations and prospects.
+Obtaining and maintaining our patent protection depends on compliance with various required procedures, document submissions, fee payments and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements.
+Periodic maintenance fees, renewal fees, annuity fees and various other governmental fees on patents and/or applications will be due to be paid to the USPTO and various governmental patent agencies outside of the United States at several stages over the lifetime of the patents and/or applications. The USPTO and various non-U.S. governmental patent agencies require compliance with a number of procedural, documentary, fee payment and other similar provisions during the patent application process. In certain circumstances, we rely on our licensors to pay these fees due to the U.S. and non-U.S. patent agencies and to take the necessary action to comply with these requirements with respect to our licensed intellectual property. In many cases, an inadvertent lapse can be cured by payment of a late fee or by other means in accordance with the applicable rules. However, there are situations in which non-compliance can result in an irrevocable abandonment or lapse of the patent or patent application, resulting in partial or complete loss of patent rights in the relevant jurisdiction. In such an event, our competitors may be able to enter the market without infringing our patents and this circumstance could have a material adverse effect on our business, financial condition, results of operations and prospects.
+We currently rely on licenses from third parties, and in the future may rely on additional licenses from other third parties, and if we lose any of these licenses, then we may be subjected to future litigation.
+We are, and may in the future become, a party to license agreements that grant us rights to use certain intellectual property, including patents and patent applications, typically in certain specified fields of use. We may need to obtain additional licenses from others to advance our research, development and commercialization activities.
+Our success may depend in part on the ability of our licensors and any future licensors to obtain, maintain and enforce patent protection for our licensed intellectual property. Without protection for the intellectual property we license, other companies might be able to offer substantially identical products and technologies for sale, which could materially adversely affect our competitive business position and harm our business, financial condition, results of operations and prospects.
+Our current license agreements impose, and future agreements may impose, various diligence, commercialization, milestone payment, royalty, insurance and other obligations on us and require us to meet development timelines, or to exercise commercially reasonable efforts to develop and commercialize licensed products, in order to maintain the licenses. If we fail to comply with these obligations, our licensor(s) may have the right to terminate our license, in which event we would not be able to develop or market products or technology covered by the licensed intellectual property. Any of the foregoing could have a material adverse effect on our competitive position, business, financial conditions, results of operations and prospects.
+Moreover, disputes may also arise between us and our licensors regarding intellectual property subject to a license agreement, including:
+ the scope of rights granted under the license agreement and other interpretation-related issues;
+ our financial or other obligations under the license agreement;
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+ whether, and the extent to which, our products, technology and processes infringe on intellectual property of the licensor that is not subject to the licensing agreement;
+ our diligence obligations under the license agreement and what activities satisfy those diligence obligations;
+ the inventorship and ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our licensor(s); and
+ the priority of invention of patented technology.
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+If we do not prevail in such disputes, we may lose any or all of our rights under such license agreements, experience significant delays in the development and commercialization of our products and technologies, or incur liability for damages, any of which could have a material adverse effect on our business, financial condition, results of operations, and prospects. In addition, we may seek to obtain additional licenses from our licensor(s) and, in connection with obtaining such licenses, we may agree to amend our existing licenses in a manner that may be more favorable to the licensor(s), including by agreeing to terms that could enable third parties, including our competitors, to receive licenses to a portion of the intellectual property that is subject to our existing licenses and to compete with our products.
+In addition, the agreements under which we currently and in the future license intellectual property or technology from third parties are complex and certain provisions in such agreements may be susceptible to multiple interpretations. The resolution of any contract interpretation disagreement that may arise could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology, or increase what we believe to be our financial or other obligations under the relevant agreement, either of which could have a material adverse effect on our business, financial condition, results of operations and prospects. Moreover, if disputes over intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements on commercially acceptable terms, we may be unable to successfully develop and commercialize any affected products or services, which could have a material adverse effect on our business, financial condition, results of operations and prospects.
+Absent the license agreements, we may infringe patents subject to those agreements, and if the license agreements are terminated, we may be subject to litigation by the licensor. Litigation could result in substantial costs and distract our management. If we do not prevail, we may be required to pay damages, including treble damages, attorneys fees or costs and expenses and royalties, which could adversely affect our ability to offer products or services, our ability to continue operations and our business, financial condition, results of operations and prospects.
+If we cannot license rights to use technologies on reasonable terms, we may not be able to commercialize new products in the future.
+We may identify third-party technology that we may need to license or acquire in order to develop or commercialize our products or technologies. However, we may be unable to secure such licenses or acquisitions. The licensing or acquisition of third-party intellectual property rights is a competitive area, and several more established companies may pursue strategies to license or acquire third-party intellectual property rights that we may consider attractive or necessary. These established companies may have a competitive advantage over us due to their size, capital resources and greater clinical development and commercialization capabilities. In addition, companies that perceive us to be a competitor may be unwilling to assign or license rights to us.
+We also may be unable to license or acquire third-party intellectual property rights on terms that would allow us to make an appropriate return on our investment or at all. In return for the use of a third party s technology, we may agree to pay the licensor royalties based on sales of our products or services. Royalties are a component of cost of products or technologies and affect the margins on our products. We may also need to negotiate licenses to patents or patent applications before or after introducing a commercial product. We may not be able to obtain necessary licenses to patents or patent applications, and our business may suffer if we are unable to enter into the necessary licenses on acceptable terms or at all, if any necessary licenses are subsequently terminated, if the licensor fails to abide by the terms of the license or fails to prevent infringement by third parties, or if the licensed intellectual property rights are found to be invalid or unenforceable.
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+Certain of our in-licensed patents are, and our future owned and in-licensed patents may be, subject to a reservation of rights by one or more third parties, including government march-in rights, that may limit our ability to exclude third parties from commercializing products similar or identical to ours.
+In addition, our owned and in-licensed patents may be subject to a reservation of rights by one or more third parties. When new technologies are developed with government funding, in order to secure ownership of such patent rights, the recipient of such funding is required to comply with certain government regulations, including timely disclosing the inventions claimed in such patent rights to the U.S. government and timely electing title to such inventions. Any failure to timely elect title to such inventions may permit the U.S. government to, at any time, take title to such inventions. Additionally, the U.S. government generally obtains certain rights in any resulting patents, including a non-exclusive royalty-free license authorizing the government to use the invention or to have others use the invention on its behalf. If the government decides to exercise these rights, it is not required to engage us as its contractor in connection with doing so. In addition, these rights may permit the U.S. government to disclose our confidential information to third parties and to exercise march-in rights to use or allow third parties to use our licensed technology free of charge. The U.S. government can exercise its march-in rights if it determines that action is necessary because we fail to achieve practical application of the government-funded technology, because action is necessary to alleviate health or safety needs, to meet requirements of federal regulations, or to give preference to U.S. industry. In addition, our rights in such inventions may be subject to certain requirements to manufacture products embodying such inventions in the United States. Any exercise by the government of any of the foregoing rights could have a material adverse effect on our business, financial condition, results of operations and prospects.
+Our products contain third-party open source software components and failure to comply with the terms of the underlying open source software licenses could restrict our ability to sell our products and provide third parties access to our proprietary software.
+Our products may contain software licensed by third parties under open source software licenses. Use and distribution of open source software may entail greater risks than use of third-party commercial software, as open source software licensors generally do not provide warranties or other contractual protections regarding infringement claims or the quality of the code. Some open source software licenses contain requirements that the licensee make its source code publicly available if the licensee creates modifications or derivative works using the open source software, depending on the type of open source software the licensee uses and how the licensee uses it. If we combine our proprietary software with open source software in a certain manner, we could, under certain open source software licenses, be required to release the source code of our proprietary software to the public for free. This would allow our competitors and other third parties to create similar products with less development effort and time and ultimately could result in a loss of our product sales and revenue, which could have a material adverse effect on our business, financial condition, results of operations and prospects. In addition, some companies that use third-party open source software have faced claims challenging their use of such open source software and their compliance with the terms of the applicable open source license. We may be subject to suits by third parties claiming ownership of what we believe to be open source software, or claiming non-compliance with the applicable open source licensing terms. Use of open source software may also present additional security risks because the public availability of such software may make it easier for hackers and other third parties to compromise or attempt to compromise our technology and systems.
+Although we review our use of open source software to avoid subjecting our proprietary software to conditions we do not intend, the terms of many open source software licenses have not been interpreted by United States courts, and there is a risk that these licenses could be construed in a way that could impose unanticipated conditions or restrictions on our ability to commercialize our products and proprietary software. Moreover, our processes for monitoring and controlling our use of open source software in our products may not be effective. If we are held to have breached the terms of an open source software license, we could be subject to damages or be required to seek licenses from third parties to continue offering our products on terms that are not economically feasible, to re-engineer our products, to discontinue the sale of our products if re-engineering could not be accomplished on a timely basis, or to make generally available, in source code form, our proprietary code, any of which could adversely affect our business, financial condition, results of operations and prospects.
+Intellectual property rights do not necessarily address all potential threats.
+The degree of future protection afforded by our intellectual property rights is uncertain because intellectual property rights have limitations, and may not adequately protect our business or permit us to maintain our competitive advantage. For example:
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+ others may be able to make products that are similar to products and technologies we may develop or utilize similar technology that are not covered by the claims of the patents that we own or license now or in the future;
+ we, or our licensor(s), might not have been the first to make the inventions covered by the issued patent or pending patent application that we license or may own in the future;
+ we, or our licensor(s), might not have been the first to file patent applications covering certain of our or their inventions;
+ others may independently develop similar or alternative technologies or duplicate any of our technologies without infringing, misappropriating or otherwise violating our owned or licensed intellectual property rights;
+ it is possible that our pending licensed patent applications or those that we may own in the future will not lead to issued patents;
+ issued patents that we own, in-license, or otherwise hold rights to may be held invalid or unenforceable or have their scope narrowed, including as a result of legal challenges by our competitors;
+ our competitors might conduct research and development activities in countries where we do not have patent rights and then use the information learned from such activities to develop competitive products for sale in our major commercial markets;
+ we may not develop additional proprietary technologies that are patentable;
+ the patents of others may harm our business; and
+ we may choose not to file a patent application for certain trade secrets or know-how, and a third party may subsequently file a patent application covering such intellectual property.
+
+Should any of these events occur, they could materially adversely affect our business, financial condition, results of operations and prospects.
+Litigation Risks
+We face the risk of product liability claims and may be subject to damages, fines, penalties and injunctions, among other things.
+Our business exposes us to the risk of product liability claims that are inherent in the testing, manufacturing and marketing of medical devices, including those which may arise from the misuse (including system hacking or other unauthorized access by third parties to our systems) or malfunction of, or design flaws in, our hardware and software products. This liability may vary based on the FDA classification associated with our devices and with the state law governing product liability standards applied to specification developers and/or manufacturers in a given negligence or strict liability lawsuit. We may be subject to product liability claims if our products cause, or merely appear to have caused, an injury. Claims may be made by patients, healthcare providers or others selling our products. The risk of product liability claims may also increase if our products are subject to a product recall or seizure. Product liability claims may be brought by individuals or by groups seeking to represent a class.
+Although we have insurance at levels that we believe to be appropriate, this insurance is subject to deductibles and coverage limitations. Our current product liability insurance may not continue to be available to us on acceptable terms, if at all, and, if available, the coverage may not be adequate to protect us against any future product liability claims. Further, if additional medical device products are approved or cleared for marketing, or if we launch additional 510(k)-exempt device products or products that are not FDA-regulated medical devices, we may seek additional insurance coverage. If we are unable to obtain insurance at an acceptable cost or on acceptable terms with adequate coverage or otherwise protect against potential product liability claims, we will be exposed to significant liabilities, which may harm our business. A product liability claim, recall or other claim with respect to uninsured liabilities or for amounts in excess of insured liabilities could result in significant costs and significant harm to our business.
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+We may be subject to claims against us even if the apparent injury is due to the actions of others or misuse of the device or a partner device. Healthcare providers may use our products in a manner inconsistent with the products labeling and that differs from the manner in which they were used in clinical studies and authorized by the FDA. Off-label use of products by healthcare providers is common, and any such off-label use of our products could subject us to additional liability, or require design changes to limit this potential off-label use once discovered. Defending a suit, regardless of merit, could be costly, could divert management attention and might result in adverse publicity, which could result in the withdrawal of, or result in reduced acceptance of, our products in the market.
+Additionally, we have entered into various agreements where we indemnify third parties for certain claims relating to our products. These indemnification obligations may require us to pay significant sums of money for claims that are covered by these indemnification obligations. We are not currently subject to any product liability claims; however, any future product liability claims against us, regardless of their merit, may result in negative publicity about us that could ultimately harm our reputation and could have a material adverse effect on our business, financial condition, results of operations and prospects.
+Risks Related to Our Securities and to Being a Public Company
+We identified material weaknesses in our internal control over financial reporting. If our remediation measures are ineffective, or if we experience additional material weaknesses in the future or otherwise fail to maintain an effective system of internal controls in the future, we may not be able to report our financial condition or results of operations accurately or in a timely manner and we may be unable to maintain compliance with applicable stock exchange listing requirements, which may adversely affect investor confidence in us and, as a result, materially and adversely affect our business and the value of our Class A common stock.
+In connection with Legacy Hyperfine s and Liminal s combined financial statement close process for the years ended December 31, 2020 and 2019, we identified a material weakness in our internal control over financial reporting. We outsourced our accounting and financial reporting to 4Catalyzer and as of and during the years ended December 31, 2020 and 2019, did not have our own finance function to appropriately perform the supervision and review of the information received from 4Catalyzer and assess its reasonableness and accuracy.
+In addition, HealthCor previously recorded a portion of its Class A ordinary shares subject to possible redemption in permanent equity. Notwithstanding the presence of maximum redemption thresholds or charter provisions common in SPACs that provide a limitation on redemptions that would cause a SPAC s net tangible assets to be less than $5,000,001, in accordance with SEC Staff guidance on redeemable equity instruments, ASC 480-10-S99, Distinguishing Liabilities from Equity , and EITF Topic D-98, Classification and Measurement of Redeemable Securities , and, according to the SEC Staff communications with certain independent auditors, redemption provisions not solely within the control of the issuing company require ordinary shares subject to redemption to be classified outside of permanent equity. Although HealthCor did not specify a maximum redemption threshold in its Articles and Restated Memorandum and Articles of Association (the HealthCor Articles ), the HealthCor Articles provided that HealthCor could not redeem its Public Shares in an amount that would cause its net tangible assets to be less than $5,000,001. In light of the recent SEC Staff communications with certain independent auditors, HealthCor s management re-evaluated the effectiveness of its disclosure controls and procedures as of September 30, 2021. Based upon that evaluation, HealthCor concluded that the misclassification of the Class A ordinary shares was quantitatively material to individual line items within the balance sheet. This resulted in a restatement of the initial carrying value of the Class A ordinary shares subject to possible redemption, with the offset recorded to additional paid-in capital (to the extent available), accumulated deficit and ordinary shares.
+The foregoing represents a material weakness in our internal controls over financial reporting. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented, or detected and corrected on a timely basis.
+In light of the material weakness identified and the resulting restatement, we plan to enhance our processes to identify and appropriately apply applicable accounting requirements to better evaluate and understand the nuances of the complex accounting standards that apply to our financial statements. Our management is in the process of developing a remediation plan, which includes, without limitation, the hiring of additional accounting and finance personnel with technical public company accounting and financial reporting experience. The material weaknesses will not be considered remediated until management designs and implements effective controls that operate for a sufficient period of time and management has concluded through testing that these controls are effective. 
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+The elements of our remediation plan can only be accomplished over time, and we can offer no assurance that these initiatives will ultimately have the intended effects or that other material weaknesses and control deficiencies will not be discovered in the future.
+If our efforts are not successful or other material weaknesses or control deficiencies occur in the future, we may be unable to report our financial results accurately on a timely basis or help prevent fraud, which could cause our reported financial results to be materially misstated and result in the loss of investor confidence or delisting and cause the market price of our shares to decline. We cannot assure you that the initiatives we have taken to date, or any initiatives we may take in the future, will be sufficient to avoid potential future material weaknesses.
+Because we are a controlled company within the meaning of the Nasdaq listing rules, our stockholders may not have certain corporate governance protections that are available to stockholders of companies that are not controlled companies.
+So long as more than 50% of the voting power for the election of our directors is held by an individual, a group or another company, we will qualify as a controlled company under the Nasdaq listing rules. As of December 31, 2021, Dr. Rothberg controls approximately 84.8% of the voting power of our outstanding capital stock. As a result, we are a controlled company under the Nasdaq rules and are not subject to the requirements that would otherwise require us to have: (i) a majority of our board of directors consist of independent directors; (ii) director nominees selected, or recommended for our board of directors selection, either by a majority of the independent directors or a nominating committee comprised solely of independent directors; and (iii) a compensation committee comprised solely of independent directors.
+Dr. Rothberg may have his interest in the Company diluted due to future equity issuances or his own actions in selling shares of our Class B common stock, in each case, which could result in a loss of the controlled company exemption under the Nasdaq listing rules. We would then be required to comply with those provisions of the Nasdaq listing rules.
+The dual class structure of our common stock has the effect of concentrating voting power with Jonathan M. Rothberg, Ph.D., Vice Chairman of our board of directors and the Founder of Legacy Hyperfine and Liminal, which will limit an investor s ability to influence the outcome of important transactions, including a change in control.
+Shares of our Class B common stock have 20 votes per share, while shares of our Class A common stock have one vote per share. Dr. Rothberg holds all of the issued and outstanding shares of our Class B common stock, and as of December 31, 2021, Dr. Rothberg holds approximately 84.8% of the voting power of our capital stock and is able to control matters submitted to our stockholders for approval, including the election of directors, amendments of our organizational documents and any merger, consolidation, sale of all or substantially all of our assets or other major corporate transactions. Dr. Rothberg may have interests that differ from yours and may vote in a way with which you disagree and which may be adverse to your interests. This concentrated control may have the effect of delaying, preventing or deterring a change in control of the Company, could deprive our stockholders of an opportunity to receive a premium for their capital stock as part of a sale of the Company, and might ultimately affect the market price of shares of our Class A common stock. If additional shares of our Class B common stock are issued, your shares and your votes may be significantly diluted.
+Potential conflicts of interest may arise among the holders of our Class B common stock and the holders of our Class A common stock.
+Dr. Rothberg holds all of our Class B common stock following the Business Combination. As a result, conflicts of interest may arise among Dr. Rothberg, on the one hand, and the Company and holders of our Class A common stock on the other hand. Dr. Rothberg has the ability to influence our business and affairs through his ownership of the high vote shares of our common stock, his general ability to elect our board of directors, and provisions in the Charter requiring his approval for certain corporate actions (in addition to approval by our board of directors). If the holders of our Class A common stock are dissatisfied with the performance of our board of directors, they have no ability to remove any of our directors, with or without cause.
+Further, through his ability to elect our board of directors and as well as his service on our board of directors, Dr. Rothberg has the ability to influence the determination of the amount and timing of our investments and dispositions, cash expenditures, indebtedness, issuances of shares of common stock, tax liabilities and amounts of reserves.
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+Delaware law and provisions in our Charter and bylaws could make a takeover proposal more difficult.
+Our organizational documents are governed by Delaware law. Certain provisions of Delaware law and of our Charter and bylaws could discourage, delay, defer or prevent a merger, tender offer, proxy contest or other change of control transaction that a stockholder might consider in its best interest, including those attempts that might result in a premium over the market price for the shares of our Class A common stock held by our stockholders. These provisions provide for, among other things:
+ the ability of our board of directors to issue one or more series of preferred stock;
+ stockholder action by written consent only until the first time when Dr. Rothberg and his permitted transferees cease to beneficially own shares of Class B common stock representing 50% or more of the voting power of the outstanding shares of our capital stock;
+ certain limitations on convening special stockholder meetings;
+ advance notice for nominations of directors by stockholders and for stockholders to include matters to be considered at our annual meetings;
+ amendment of certain provisions of the organizational documents only by the affirmative vote of holders of (i) a majority of the voting power of the shares of our capital stock so long as Dr. Rothberg and his permitted transferees beneficially own shares of Class B common stock representing 50% or more of the voting power of the outstanding shares of our capital stock and (ii) at least two-thirds of the voting power of the shares of capital stock from and after the time that Dr. Rothberg and his permitted transferees cease to beneficially own shares of Class B common stock representing 50% or more of the voting power of our voting stock; and
+ a dual-class common stock structure with 20 votes per share of our Class B common stock, the result of which is that Dr. Rothberg has the ability to control the outcome of matters requiring stockholder approval, even though Dr. Rothberg owns less than a majority of the outstanding shares of our capital stock.
+
+These anti-takeover provisions as well as certain provisions of Delaware law could make it more difficult for a third party to acquire the Company, even if the third party s offer may be considered beneficial by many of our stockholders. As a result, our stockholders may be limited in their ability to obtain a premium for their shares. If prospective takeovers are not consummated for any reason, we may experience negative reactions from the financial markets, including negative impacts on the price of our Class A common stock. These provisions could also discourage proxy contests and make it more difficult for our stockholders to elect directors of their choosing and to cause us to take other corporate actions that our stockholders desire. See Description of our Capital Stock. 
+Our Charter designates the Court of Chancery of the State of Delaware as the sole and exclusive forum for certain types of actions and proceedings and the federal district courts as the sole and exclusive forum for other types of actions and proceedings, in each case, that may be initiated by our stockholders, which could limit our stockholders ability to obtain what such stockholders believe to be a favorable judicial forum for disputes with the Company or our directors, officers or other employees.
+Our Charter provides that, unless we consent to the selection of an alternative forum, any (i) derivative action or proceeding brought on behalf of us; (ii) action asserting a claim of breach of a fiduciary duty owed by, or any other wrongdoing by, any current or former director, officer, other employee or stockholder of us; (iii) action asserting a claim against us arising pursuant to any provision of the DGCL or our Charter or our bylaws or as to which the DGCL confers jurisdiction on the Court of Chancery; (iv) action to interpret, apply, enforce, or determine the validity of any provisions in the certificate of incorporation of bylaws; or (v) action asserting a claim governed by the internal affairs doctrine, shall, to the fullest extent permitted by law, be exclusively brought in the Court of Chancery of the State of Delaware or, if such court does not have subject matter jurisdiction thereof, the federal district court of the State of Delaware. Subject to the foregoing, the federal district courts of the United States are the exclusive forum for the resolution of any action, suit or proceeding asserting a cause of action under the Securities Act. The exclusive forum provision does not apply to suits brought to enforce any liability or duty created by the Exchange Act. Any person or entity purchasing or otherwise acquiring or holding an interest in any shares of our capital stock shall be deemed to have notice of and to have consented to the forum 
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+provisions in our Charter. These choice-of-forum provisions may limit a stockholder s ability to bring a claim in a judicial forum that he, she or it believes to be favorable for disputes with the Company or our directors, officers or other employees or stockholders, which may discourage such lawsuits. We note that there is uncertainty as to whether a court would enforce these provisions and that investors cannot waive compliance with the federal securities laws and the rules and regulations thereunder. Section 22 of the Securities Act creates concurrent jurisdiction for state and federal courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder.
+Alternatively, if a court were to find these provisions of our Charter inapplicable or unenforceable with respect to one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters in other jurisdictions, which could materially adversely affect our business, financial condition and results of operations and result in a diversion of the time and resources of our management and board of directors.
+The Charter does not limit the ability of the Sponsor to compete with the Company.
+The Sponsor and its affiliates engage in a broad spectrum of activities, including investments in the life sciences and medical technology industries. In the ordinary course of their business activities, the Sponsor and its affiliates may engage in activities where their interests conflict with our interests or those of our stockholders. The Charter does not provide that the Sponsor and its affiliates have any duty to refrain from engaging, directly or indirectly, in the same business activities or similar business activities or lines of business in which we operate. The Sponsor and its affiliates also may pursue acquisition opportunities that may be complementary to our business, and, as a result, those acquisition opportunities may not be available to the Company. In addition, the Sponsor may have an interest in pursuing acquisitions, divestitures and other transactions that, in its judgment, could enhance its investment, even though such transactions might involve risks to you.
+We are an emerging growth company and a smaller reporting company within the meaning of the Securities Act, and we may take or continue to take advantage of certain exemptions from disclosure requirements available to emerging growth companies or smaller reporting companies, which could make our securities less attractive to investors and may make it more difficult to compare our performance with other public companies.
+We are an emerging growth company within the meaning of the Securities Act, as modified by the JOBS Act, and we may take or continue to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. As a result, our stockholders may not have access to certain information they may deem important. We could be an emerging growth company for up to five years, although circumstances could cause us to lose that status earlier, including if the market value of our Class A common stock held by non-affiliates is $700 million or more as of the last business day of the most recently completed second fiscal quarter, in which case we would no longer be an emerging growth company as of the end of that fiscal year. We cannot predict whether investors will find our securities less attractive because we will rely on these exemptions. If some investors find our securities less attractive as a result of our reliance on these exemptions, the trading prices of our securities may be lower than they otherwise would be, there may be a less active trading market for our securities and the trading prices of our securities may be more volatile.
+Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. We have elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our financial statements with another public company which is not an emerging growth company or is an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accountant standards used.
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+Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We are required to reflect a determination that we are no longer a smaller reporting company in our quarterly report on Form 10-Q for the first fiscal quarter of the next fiscal year after the fiscal year in which (i) the market value of our common stock held by non-affiliates is greater than or equal to $250 million as of the end of that fiscal year s second fiscal quarter, and (ii) if our annual revenues are not greater than or equal to $100 million during the last completed fiscal year, the market value of our common stock held by non-affiliates is $700 million or more as of the end of that fiscal year s second fiscal quarter. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible.
+Reports published by analysts, including projections in those reports that differ from our actual results, could adversely affect the price and trading volume of our Class A common stock.
+Securities research analysts may establish and publish their own periodic projections for us. Those projections may vary widely and may not accurately predict the results we actually achieve. Our share price may decline if our actual results do not match the projections of these securities research analysts. Similarly, if one or more of the analysts who write reports on us downgrades our stock or publishes inaccurate or unfavorable research about our business, our share price could decline. In addition, securities research analysts may compare us to companies that are not appropriately comparable, which could lead to lower than expected valuations. If one or more analysts cease coverage of us or fail to publish reports on us regularly, our share price or trading volume could decline.
+Our business and operations could be negatively affected if we become subject to any securities litigation or shareholder activism, which could cause us to incur significant expense, hinder execution of our business and growth strategy and impact our stock price.
+In the past, following periods of volatility in the market price of a company s securities, securities class action litigation has often been brought against that company. Shareholder activism, which could take many forms or arise in a variety of situations, has been increasing recently. Volatility in the stock price of our Class A common stock or other reasons may in the future cause us to become the target of securities litigation or shareholder activism. Securities litigation and shareholder activism, including potential proxy contests, could result in substantial costs and divert management s and the board of directors attention and resources from our business. Additionally, such securities litigation and shareholder activism could give rise to perceived uncertainties as to our future, adversely affect our relationships with service providers and make it more difficult to attract and retain qualified personnel. Also, we may be required to incur significant legal fees and other expenses related to any securities litigation and activist shareholder matters. Further, our stock price could be subject to significant fluctuation or otherwise be adversely affected by the events, risks and uncertainties of any securities litigation and shareholder activism.
+The grant of registration rights pursuant to the Registration Rights Agreement, the PIPE Subscription Agreements and the Letter Agreement, and the future exercise of such rights, may adversely affect the market price of our Class A common stock.
+At the Closing, we, the Sponsor, certain affiliates of the Sponsor and certain stockholders of Legacy Hyperfine and Liminal entered into the Registration Rights Agreement, pursuant to which, among other things, the parties to the Registration Rights Agreement agreed not to effect any sale or distribution of any our equity securities held by any of them (except with respect to shares of our Class A common stock acquired in open market transactions or pursuant to the PIPE Investment) during the respective lock-up period described therein and were granted certain registration rights with respect to their respective shares of our common stock, in each case, on the terms and subject to the conditions therein. The parties to the Registration Rights Agreement and their permitted transferees have customary registration rights (including demand and piggy-back rights, subject to cooperation and cut-back provisions). In particular, the Registration Rights Agreement provides that promptly, but in any event within forty-five (45) days following the Closing Date, we are required to use our commercially reasonable efforts to file a registration statement under the Securities Act to permit the public resale of all registrable securities as permitted by Rule 415 of the Securities Act and to cause such registration statement to be declared effective as soon as practicable after the filing thereof, but in no event later than forty-five (45) days following the filing deadline (or sixty (60) days following the filing deadline if the registration statement is reviewed by and receives comments from the Securities and Exchange Commission (the SEC )).
+Further, pursuant to the Subscription Agreements and the Letter Agreement, we agreed (i) to file within 45 days after the closing of the Business Combination a registration statement with the SEC for the resale of the PIPE Securities by the PIPE Investors and the 
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+Letter Agreement Shares by Jefferies LLC, (ii) to use commercially reasonable efforts to cause such registration statement to be declared effective as soon as practicable after the filing thereof, but no later than the earlier of (a) the 45th calendar day (or 60th calendar day if the SEC notifies us that it will review the registration statement) and (b) the 10th business day after the date we are notified (orally or in writing, whichever is earlier) by the SEC that the registration statement will not be reviewed or will not be subject to further review and (iii) to maintain the effectiveness of such registration statement until the earlier of (a) five years from the date of effectiveness of the initial registration statement, (b) the date on which PIPE Investors cease to hold the securities covered thereby, and (c) the date all of the securities covered thereby can be sold publicly without restriction or limitation under Rule 144 under the Securities Act. We will bear the cost of registering these securities. The registration and availability of such a significant number of securities for trading in the public market may have an adverse effect on the market price of our Class A common stock.
+The obligations associated with being a public company will involve significant expenses and will require significant resources and management attention, which may divert from our business operations.
+As a public company, we are subject to the reporting requirements of the Exchange Act and the Sarbanes-Oxley Act. The Exchange Act requires the filing of annual, quarterly and current reports with respect to a public company s business and financial condition. The Sarbanes-Oxley Act requires, among other things, that a public company establish and maintain effective internal control over financial reporting. As a result, we are incurring, and will continue to incur significant legal, accounting and other expenses that Legacy Hyperfine and Liminal did not previously incur. Our management team and many of our other employees will need to devote substantial time to compliance, and may not effectively or efficiently manage our transition into a public company.
+We do not intend to pay cash dividends for the foreseeable future.
+We currently intend to retain our future earnings, if any, to finance the further development and expansion of our business and do not intend to pay cash dividends in the foreseeable future. Any future determination to pay dividends will be at the discretion of our board of directors and will depend on our financial condition, results of operations, capital requirements, and future agreements and financing instruments, business prospects and such other factors as our board of directors deems relevant.
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+USE OF PROCEEDS
+All of the Class A common stock and Class B common stock offered by the Selling Securityholders pursuant to this prospectus will be sold by the Selling Securityholders for their respective accounts. We will not receive any of the proceeds from these sales.
+DETERMINATION OF OFFERING PRICE
+We cannot currently determine the price or prices at which shares of Class A common stock or shares of Class B common stock may be sold by the Selling Securityholders under this prospectus.
+MARKET PRICE, TICKER SYMBOL AND DIVIDEND INFORMATION
+Market Price and Ticker Symbol
+Our Class A common stock is currently listed on Nasdaq under the symbol HYPR .
+The closing price of the Class A common stock on January 20, 2022 was $5.00.
+Holders
+As of December 31, 2021, there were approximately 348 holders of record of our Class A common stock and approximately two holders of record of our Class B common stock.
+Such numbers do not include beneficial owners holding our securities through nominee names. There is no public market for our Class B common stock.
+Dividend Policy
+We have not paid any cash dividends on our Class A common stock or Class B common stock to date. The payment of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital requirements and general financial condition. The payment of any cash dividends will be within the discretion of the Board at such time.
+ 
+
+51
+
+Table of Contents
+
+UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
+Unless the context otherwise requires, the Combined Company refers to Hyperfine, Inc. (f/k/a HealthCor Catalio Acquisition Corp.) and its subsidiaries after the Closing, HealthCor refers to HealthCor Catalio Acquisition Corp. prior to the Closing, Hyperfine refers to Hyperfine Operations, Inc. (f/k/a Hyperfine, Inc.) prior to the Closing, Liminal refers to Liminal Operations, Inc. (f/k/a Liminal Sciences, Inc.) prior to the Closing, and the Companies or Company refers to Hyperfine and Liminal prior to the Closing.
+On December 22, 2021, HealthCor, Hyperfine and Liminal consummated the previously announced business combination (the Business Combination ) contemplated by the Business Combination Agreement, dated as of July 7, 2021 (the Business Combination Agreement ), by and among HealthCor, Optimus Merger Sub I, Inc. ( Merger Sub I ), Optimus Merger Sub II, Inc. ( Merger Sub I ), Hyperfine and Liminal, pursuant to which, among other things, (a) Merger Sub I merged with and into Hyperfine, with Hyperfine surviving the merger as a wholly owned subsidiary of HealthCor (the Hyperfine Merger ), and (b) Merger Sub II merged with and into Liminal, with Liminal surviving the merger as a wholly owned subsidiary of HealthCor (the Liminal Merger, and together with the Hyperfine Merger, the Mergers ). In connection with the Business Combination, HealthCor changed its name to Hyperfine, Inc., Legacy Hyperfine changed its name to Hyperfine Operations, Inc. and Liminal changed its name to Liminal Operations, Inc. After giving effect to the Business Combination, HealthCor directly owns all of the issued and outstanding equity interests of Hyperfine and Liminal, and the pre-Business Combination stockholders of Hyperfine and Liminal hold a portion of the Combined Company s Class A common stock and all of the Combined Company s Class B common stock.
+Prior to the Business Combination, on December 21, 2021, HealthCor changed its jurisdiction of incorporation from the Cayman Islands to the State of Delaware (the Domestication ) by deregistering as an exempted company in the Cayman Islands and continuing and domesticating as a corporation incorporated under the laws of the State of Delaware.
+Concurrently with the execution of the Business Combination Agreement, on July 7, 2021, HealthCor entered into subscription agreements (the Subscription Agreements ) with certain institutional investors and accredited investors (the PIPE Investors ), pursuant to which shares of Class A common stock were issued immediately prior to the Closing to the PIPE Investors (the PIPE Investment ), as described in greater detail in Note 3 of the Notes to Unaudited Pro Forma Condensed Combined Financial Information. 
+Additionally, on December 22, 2021, HealthCor, HC Sponsor LLC (the Sponsor ), Hyperfine and Liminal entered into a Forfeiture Agreement (the Forfeiture Agreement ), pursuant to which, immediately prior to the Closing, 150,000 shares of HealthCor s Class B common stock held by the Sponsor were irrevocably forfeited and automatically cancelled (the Forfeiture ).
+The following unaudited pro forma condensed combined balance sheet of the Combined Company as of September 30, 2021 and the unaudited pro forma condensed combined statements of operations of the Combined Company for the nine months ended September 30, 2021 and for the year ended December 31, 2020 present the combination of the financial information of HealthCor, Hyperfine and Liminal after giving effect to the Business Combination and related adjustments described in the accompanying notes.
+The unaudited pro forma condensed combined statements of operations for the nine months ended September 30, 2021 and for the year ended December 31, 2020 give pro forma effect to the Business Combination as if it had occurred on January 1, 2020. The unaudited pro forma condensed combined balance sheet as of September 30, 2021 gives pro forma effect to the Business Combination as if it was completed on September 30, 2021.
+The unaudited pro forma condensed combined financial information is based on and should be read in conjunction with:
+ the accompanying notes to the unaudited pro forma condensed combined financial information;
+ the historical unaudited financial statements of HealthCor as of and for the nine months ended September 30, 2021, and the historical audited financial statements of HealthCor as of December 31, 2020 and for the period from November 18, 2020 (date of inception) through December 31, 2020, and the related notes, in each case, included elsewhere in this prospectus;
+ the historical unaudited condensed consolidated and combined financial statements of Hyperfine and Liminal as of and for the nine months ended September 30, 2021, and the historical audited combined financial statements of Hyperfine and 
+
+52
+
+Table of Contents
+
+Liminal as of and for the year ended December 31, 2020, and the related notes, in each case, included elsewhere in this prospectus; and
+ other information relating to HealthCor, Hyperfine and Liminal contained in this prospectus, including the Business Combination Agreement and the description of certain terms thereof set forth under
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/IDXG_interpace_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/IDXG_interpace_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..065462a25a6ccd24eda01da1efc4b484c4a12f3c
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@@ -0,0 +1,883 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+The
+following summary provides an overview of us and this offering and may not contain all the information that is important to you. This
+summary is qualified in its entirety by, and should be read together with, the information contained in other parts of this prospectus
+and the documents we incorporate by reference. You should read this prospectus and any documents that we incorporate by reference carefully
+in their entirety before making a decision about whether to invest in our securities.
+
+ 
+
+Interpace
+Biosciences, Inc.
+
+ 
+
+Overview
+
+ 
+
+We
+are an emerging leader in enabling precision medicine principally in oncology by offering specialized services along the therapeutic
+value chain from early diagnosis and prognostic planning to targeted therapeutic applications through our clinical and pharma services.
+Through our clinical services, we enable physicians to personalize the clinical management of each individual patient by providing genomic
+information to better diagnose, monitor and inform cancer treatment. Our clinical services provide clinically useful molecular diagnostic
+tests, bioinformatics and pathology services for evaluating risk of cancer by leveraging the latest technology in personalized medicine
+for improved patient diagnosis and management. Through our pharma services, we develop, commercialize and provide molecular- and biomarker-based
+tests and services and provide companies with customized solutions for patient stratification and treatment selection through an extensive
+suite of molecular and biomarker-based testing services, DNA and RNA extraction and customized assay development and trial design consultation.
+Our pharma services provide pharmacogenomics testing, genotyping, biorepository and other specialized services to the pharmaceutical
+and biotech industries and advance personalized medicine by partnering with pharmaceutical, academic and technology leaders to effectively
+integrate pharmacogenomics into drug development and clinical trial programs with the goals of delivering safer, more effective drugs
+to market more quickly, and improving patient care.
+
+ 
+
+ 
+ Customer
+ Category
+ 
+ Types
+ of Customers
+ 
+ Nature
+ of Services
+
+ 
+ Clinical
+ services
+ 
+ 
+ Hospitals
+
+ Physicians
+
+ Cancer Centers
+
+ Clinics
+ 
+ Clinical
+ services provide information on diagnosis, prognosis and predicting treatment outcomes of cancers to guide patient management.
+
+ 
+ 
+ 
+ 
+ Commercial laboratories
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Pathology groups
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Pharma
+ services
+ 
+ 
+ Pharmaceutical companies
+
+ Biotech companies
+
+ Contract Research Organizations
+
+ Academic Researchers
+
+ Diagnostic companies
+ 
+ Pharma
+ services provide expert-based collaborative solutions, customized assays and high quality services in support of their pharmaceutical
+ and biotechnology clients therapeutic development programs. By deploying deep scientific and medical expertise, pharma services
+ support all phases of drug development and accelerate their clients clinical programs.
+
+ 
+ 
+
+Our
+Service Offerings
+
+ 
+
+Our
+business is based on demand for molecular- and biomarker-based characterization of cancers from three main sectors: (1) physicians, hospitals
+and clinics, (2) biotechnology and pharmaceutical companies, and (3) the research community.
+
+ 
+
+Clinicians
+and oncologists in cancer centers and hospitals seek molecular-based testing since these methods often produce higher value and more
+accurate cancer diagnostic information than traditional analytical methods. Our proprietary and unique disease-focused or esoteric tests
+aim to provide actionable information that can guide patient management decisions, potentially resulting in decreased costs.
+
+ 
+
+We
+continue to pursue the strategy of trying to demonstrate increased value and efficacy with payers who wish to contain costs and academic
+collaborators seeking to develop new insights and cures.
+
+ 
+
+ 
+
+ 9
+
+ 
+
+ 
+
+ 
+
+ 
+
+Our
+pharma services are sought by biotechnology and pharmaceutical companies engaged in designing and running clinical trials, from pre-clinical
+to post market surveillance, for their value and efficacy in oncology and immuno-oncology treatments and therapeutics.
+
+ 
+
+We
+aim to provide physicians and patients with diagnostic options for detecting genomic and other molecular alterations that are associated
+with gastrointestinal, endocrine, and lung cancers. Our clinical services customers consist primarily of physicians, hospitals
+and clinics.
+
+ 
+
+Clinical
+Services
+
+ 
+
+Our
+clinical services business commercializes clinically useful molecular diagnostic tests and molecular pathology services. We commercialize
+genomic tests and related first line assays principally focused on early detection of patients at high risk of cancer using the latest
+technology to help personalize medicine and improve patient diagnosis and management. Our tests and services provide mutational analysis
+of genomic material contained in suspicious cysts, nodules and lesions with the goal of better informing treatment decisions in patients
+at risk of thyroid, pancreatic, and other cancers. The molecular diagnostic tests we offer enable healthcare providers to better assess
+cancer risk, helping to avoid unnecessary surgical treatment in patients at low risk, while also helping to identify high risk patients
+that would benefit from surgical intervention.
+
+ 
+
+Our
+mission is to provide personalized medicine through genomics-based diagnostics and innovation to advance patient care based on rigorous
+science. Our laboratories are licensed pursuant to federal law under Clinical Laboratory Improvement Amendments of 1988 ( CLIA )
+and are accredited by College of American Pathologists ( CAP ) and our products are approved by New York State. We are leveraging
+our licensed and accredited laboratories to refine and commercialize our assays and products. We aim to provide physicians and patients
+with diagnostic options for detecting genomic and other molecular alterations that are associated with gastrointestinal, endocrine, and
+other cancers. Our customers consist primarily of physicians, hospitals and clinics.
+
+ 
+
+We
+currently have five commercialized molecular diagnostic tests in the marketplace: PancraGEN , which is a pancreatic cyst and pancreaticobiliary
+solid lesion genomic test that helps physicians better assess risk of pancreaticobiliary cancers using our proprietary PathFinderTG 
+platform PanDNA, a molecular only version of PancraGEN that provides physicians a snapshot of a limited number
+of factors; ThyGeNEXT , which is an expanded oncogenic mutation panel that helps identify malignant thyroid nodules ThyraMIR ,
+which, in combination with ThyGeNEXT , assesses thyroid nodules for risk of malignancy utilizing a proprietary microRNA gene expression
+assay; and RespriDx , which is a genomic test that helps physicians differentiate metastatic or recurrent lung cancer from the presence
+of newly formed primary lung cancer and which also utilizes our PathFinderTG platform.
+
+ 
+
+Gastrointestinal
+Cancer Products
+
+ 
+
+Our
+current gastrointestinal integrated pathology risk diagnostic assay, PancraGEN is based on our PathFinderTG platform. PathFinderTG 
+is designed to use advanced clinical algorithms to accurately stratify patients according to risk of pancreatic cancer by assessing panels
+of DNA abnormalities in patients who have pancreaticobiliary lesions (cysts or solid masses) with potential for cancer. PanDNA is a molecular
+only reporting option for physicians that perform their own integration of first line testing results. PathFinderTG is supported
+by our state of the art CLIA certified, and CAP accredited laboratory in Pittsburgh, Pennsylvania. Our Pittsburgh laboratory is our largest
+clinical laboratory where we process the majority of our oncology related commercial tests; we also support our other gastrointestinal
+and endocrine commercial activities through this laboratory.
+
+ 
+
+Early
+detection of pancreatic cancer is crucial. Based on the American Cancer Society Cancer 2021 Cancer Facts and Figures, pancreatic cancer
+is the fourth leading cause of cancer deaths in the U.S. with an average five year survival rate of 10%. PancraGEN and PanDNA 
+are designed to determine risk of malignancy in pancreatic cysts and pancreaticobiliary solid lesions, which are more often than not
+benign lesions but have potential for developing into cancer. We believe that PancraGEN is the leader in the market for integrated
+molecular diagnostic tests for determining risk of pancreaticobiliary malignancy. We currently estimate that the immediate addressable
+market for PancraGEN is approximately 130,000 indeterminate pancreaticobiliary lesions annually or approximately $350 million annually
+based on the current size of the patient population and reimbursement rates. To date, PancraGEN testing has been used in more than
+50,000 clinical cases. The National Pancreatic Cyst Registry study published in Endoscopy in 2015 demonstrated that PancraGEN more
+accurately determines the malignant potential of pancreatic cysts than international consensus 2012 imaging criteria, helping to ensure
+that surgery is reserved for the most appropriate patients. When molecular analysis is not performed, the vast majority of all pancreatic
+cyst surgeries are performed on cystic lesions that do not harbor malignancy.
+
+ 
+
+ 
+
+ 10
+
+ 
+
+ 
+
+ 
+
+ 
+
+The
+American Gastroenterological Association 2015 Guidelines have cautioned that many pancreatic surgeries have been performed unnecessarily
+for lesions that will not progress to invasive adenocarcinoma. In addition, the 2016 guidelines published by the American Society of
+Gastroenterology Endoscopy (ASGE) in Gastrointestinal Endoscopy included a specific recommendation for use of molecular testing in specific
+circumstances where other types of testing and analysis have not provided sufficient data on which to determine the best course of action
+for patient treatment. Accordingly, we believe that PancraGEN provides a highly reliable diagnostic and prognostic option that identifies
+cancer risk in circumstances where risk of cancer is otherwise uncertain.
+
+ 
+
+Endocrine
+Cancer Products
+
+ 
+
+We
+currently market and sell a dual platform endocrine cancer risk diagnostic assay. The incidence of thyroid nodules is on the rise. ThyGeNEXT 
+is a next generation DNA and RNA sequencing oncogene and mRNA fusion panel that is used to evaluate indeterminate thyroid biopsies. ThyGeNEXT 
+works synergistically with our second endocrine cancer diagnostic test ThyraMIR , which is based on measuring the relative expression
+of ten distinct microRNAs. The combination of ThyGeNEXT and ThyraMIR is designed to provide a highly sensitive rule-in 
+and rule-out test to accurately risk stratify indeterminate thyroid nodules.
+
+ 
+
+We
+estimate the total market for our endocrine cancer assays is approximately $300 million annually based on the current size of the patient
+population, estimated numbers of indeterminate biopsies and reimbursement rates. ThyGeNEXT is used by some customers as a base line
+oncogene panel assessment and greater than 85% of such users will reflex to ThyraMIR for a more specific evaluation.
+
+ 
+
+Endocrinologists
+and ear, nose and throat ( ENT ) specialists evaluate most thyroid nodules for possible cancer by collecting cells
+through Fine Needle Aspiration ( FNA ) that are then analyzed by cytopathologists to determine whether or not a thyroid
+nodule is cancerous. It is estimated that approximately 20% or well over 100,000 biopsies analyzed annually yield indeterminate results,
+meaning they cannot be diagnosed as definitely being malignant or benign by cytopathology alone. In the past, guidelines recommended
+that some patients with indeterminate cytopathology results undergo surgery to remove all or part of their thyroid to obtain an accurate
+diagnosis by looking directly at the thyroid tissue. According to a study published by Wang, et al. in 2011, in approximately 77% of
+these cases, the thyroid nodule proved to be benign. Current National Comprehensive Cancer Network ( NCCN ) and American
+Thyroid Association ( ATA ) guidelines support use of molecular analysis for nodules with indeterminate cytology results
+as this testing can prove beneficial to further characterize these lesions and support optimal patient management.
+
+ 
+
+Lung
+Cancer Product RespriDx Test and Metastatic versus Primary Platform
+
+ 
+
+RespriDx 
+compares the mutational fingerprint of two or more sites of cancer to determine whether the neoplastic deposits are representative of
+a recurrence (metastasis) of lung cancer or a new primary or independent tumor. The test, which currently provides only nominal revenues,
+defines the presence or absence of cancer in atypical cytology by comparing the mutational profile with that of known previous cancer.
+RespriDx assists in determining the most appropriate course of treatment, whether chemotherapy, surgery, or other modalities.
+
+ 
+
+Pharma
+Services
+
+ 
+
+We
+provide data driven solutions for pharmaceutical and biotech companies engaged in clinical trials and focus on providing these clients
+with oncology specific and non-oncology genetic testing services for phase I-IV clinical trials along with critical support of ancillary
+services. These ancillary services include: biorepository, clinical trial logistics, clinical trial design, bioinformatics analysis,
+customized assay development. DNA and RNA extraction and purification, genotyping, gene expression, flow cytometry, cytogenetic and FISH
+and biomarker analyses. We also seek to apply our expertise in laboratory developed tests to assist in developing and commercializing
+drug-specific companion diagnostics. We have established business relationships with key instrument manufacturers to provide a multi-omic
+approach, and to drive acceptance among biopharmaceutical sponsors developing innovative immuno-oncology therapies.
+
+ 
+
+We
+also utilize our pharma services laboratories to provide clinical trial services to the pharmaceutical and biotech industries to improve
+the efficiency and economic viability of clinical trials. Our clinical trials services leverage our knowledge of clinical oncology and
+molecular diagnostics and our laboratories fully integrated capabilities. We believe our pharma services operates one of only
+a few laboratories with the capability to combine somatic and germline mutational analyses in clinical trials.
+
+ 
+
+ 
+
+ 11
+
+ 
+
+ 
+
+ 
+
+ 
+
+Our
+pharma services laboratory located in Raleigh, North Carolina. has current certificates under CLIA to perform high complexity testing
+and are accredited by CAP, one of seven CLIA-approved accreditation organizations.
+
+ 
+
+Industry
+research has shown many promising drugs have produced disappointing results in clinical trials. For example, a 2016 article by the University
+of Michigan reported that only 1 in 50 cancer drug candidates make it to the clinical market. Given such a high failure rate of oncology
+drugs, combined with constrained budgets for biotech and pharmaceutical companies, there is a significant need for drug developers to
+utilize molecular diagnostics to decrease these failure rates. For specific molecular-targeted therapeutics, the identification of appropriate
+biomarkers indicative of disease type or prognosis may help to optimize clinical trial patient selection and increase trial success rates
+by helping clinicians identify patients that are most likely to benefit from a therapy based on their individual genomic profile.
+
+ 
+
+From
+a laboratory infrastructure standpoint, we possess capabilities in histology, immunohistochemistry ( IHC ), flow cytometry,
+cytogenetics and fluorescent in-situ hybridization ( FISH ), as well as sophisticated molecular analysis techniques,
+including next generation sequencing. This allows for comprehensive esoteric testing within one lab enterprise, with our CLIA-certified,
+CAP-accredited laboratory serving as a central hub for specimen tracking. Using this approach, we are able to support demanding clinical
+trial protocols requiring multiple assays and techniques aimed at capturing data on multiple biomarkers. Our suite of available testing
+platforms allows for highly customized clinical trial design which is supported by our dedicated group of development scientists and
+technical personnel.
+
+ 
+
+In
+February of 2020, ClinicalTrials.gov reported over 40,000 clinical trials that are either preparing or recruiting patients. Molecular-
+and biomarker-based testing services have been altering the clinical trials landscape by providing biotech and pharmaceutical companies
+with information about trial subjects genetic profiles that may be able to inform researchers whether or not a subject will benefit
+from the trial drug or will experience adverse effects. We believe that streamlined subject selection and stratification and tailored
+therapies selected to maximally benefit each group of subjects may increase the number of trials that result in approved therapies and
+make conducting clinical trials more efficient and less costly for biotech and pharmaceutical companies. According to the United States
+Food and Drug Administration ( FDA ), 2019 produced over 48 new drug approvals and over 20% of these drugs were oncology-focused,
+highlighting the potential value of incorporating genomic information into oncology clinical trial design.
+
+ 
+
+We
+also provide genetic testing for drug metabolism to aid biotech and pharmaceutical companies identify subjects likely responses
+to treatment, allowing these companies to conduct more efficient and safer clinical trials. We believe pharmacogenomics drug metabolism
+testing helps deliver the promise of personalized medicine by enabling researchers to tailor therapies in development to differences
+in patients genomic profiles.
+
+ 
+
+COVID-19
+Pandemic
+
+ 
+
+The
+outbreak of the COVID-19 pandemic continues to impact a significant portion of the regions in which we operate. The continuing impact
+that the COVID-19 pandemic will have on our operations, including duration, severity and scope, remains highly uncertain and cannot be
+fully predicted at this time. While we believe we have generally recovered from the adverse impact that the COVID-19 pandemic had on
+our business during 2020, we believe that the COVID-19 pandemic could continue to adversely impact our results of operations, cash flows
+and financial condition in the future.
+
+ 
+
+As
+our business operations continue to be impacted by the pandemic, we continue to monitor the situation and the guidance that is being
+provided by relevant federal, state and local public health authorities. We may take additional actions based upon their recommendations.
+However, it is possible that we may have to make further adjustments to our operating plans in reaction to developments that are beyond
+our control.
+
+ 
+
+While
+we do not anticipate any lab closures at this time beyond periodic, temporary work stoppages to clean and disinfect the labs, this could
+change in the future based upon conditions caused by the pandemic. It is also possible that we could experience supply chain shortages
+if the pandemic worsens and if one or more suppliers is unable to continue to provide us with supplies. For the foreseeable future, however,
+we do not anticipate supply chain shortages of critical supplies.
+
+ 
+
+We
+have developed and will continue to update our contingency plans in order to mitigate pandemic-related, adverse financial impacts upon
+our business.
+
+ 
+
+ 
+
+ 12
+
+ 
+
+ 
+
+ 
+
+ 
+
+Nasdaq
+Delisting
+
+ 
+
+On
+February 16, 2021, the Company received a delisting determination letter (the Letter ) from the Listing Qualifications
+Department (the Staff ) of The Nasdaq Stock Market LLC ( Nasdaq ) stating that Nasdaq had determined
+to delist the Company s common stock from Nasdaq due to the Company s failure to regain compliance with the Nasdaq Capital
+Market s minimum $2,500,000 stockholders equity requirement for continued listing as set forth in Nasdaq Listing Rule 5550(b)
+and the Company s failure to timely execute its plan to regain compliance under such rule.
+
+ 
+
+Nasdaq
+commenced with delisting the Company s common stock from the Nasdaq Capital Market and, suspended trading in the Company s
+common stock effective at the open of business on February 25, 2021.
+
+ 
+
+On
+February 24, 2021, the Company was approved to have its common stock quoted on the OTCQX Best Market tier of the OTCQX. The trading
+of the Company s common stock commenced on OTCQX at the open of business on February 25, 2021 under the trading symbol IDXG .
+
+ 
+
+Additional
+Reimbursement Coverage and Price Increase During 2021
+
+ 
+
+Reimbursement
+progress is key for us. We have been successful to date in expanding both the scope and amount of product reimbursement for our clinical
+services in 2021. Examples of our progress include:
+
+ 
+
+ In
+ January 2021, we announced an agreement with Blue Cross Blue Shield of Florida under which
+ ThyGeNEXT and ThyraMIR tests are now covered in-network services for their 5 million
+ members.
+
+ 
+
+ In
+ February 2021, we announced an agreement with Blue Cross Blue Shield of Illinois that makes
+ ThyGeNEXT and ThyraMIR tests covered in-network services for their more than 8
+ million members in Illinois.
+
+ 
+
+ In
+ April 2021, we announced that Novitas, our Medicare Administrative Contractor, has agreed
+ to recognize the new Proprietary Laboratory Analysis ( PLA ) code that
+ specifically identifies ThyGeNEXT as a distinct test from any other test or service.
+ The new PLA code for ThyGeNEXT is 0245U and the reimbursement for this code remains
+ $2,919, representing a significant price increase over the prior reimbursement level of $560.
+
+ 
+
+ In
+ May 2021, we announced that eviCore Healthcare ( eviCore ), a wholly owned
+ subsidiary of Cigna, has updated their laboratory management guidelines to include positive
+ coverage for ThyGeNEXT and ThyraMIR . This update, which impacts approximately 27
+ health plans nationwide covering 100 million lives, is effective on July 1, 2021. This means
+ that after the effective date, claims for ThyGeNEXT and ThyraMIR which meet eviCore s
+ criteria for coverage will be considered medically necessary and processed as a covered service.
+
+ 
+
+Corporate
+Information
+
+ 
+
+We
+were originally incorporated in New Jersey in 1986 and began commercial operations as PDI, Inc., a contract sales organization ( CSO ),
+in 1987. In connection with PDI, Inc. s initial public offering, it reincorporated in Delaware in 1998. In 2015, the CSO business
+and related assets were sold, and we operated our molecular diagnostics business as Interpace Diagnostics Group, Inc. On July 15, 2019,
+we acquired the pharma services business from the secured creditors of Cancer Genetics, Inc. and its wholly owned subsidiary, Gentris,
+LLC, and began to conduct our business as Interpace Pharma Solutions, Inc. We accordingly conduct our business through our wholly-owned
+subsidiaries, Interpace Diagnostics, LLC, which was formed in Delaware in 2013, Interpace Diagnostics Corporation (formerly known as
+RedPath Integrated Pathology, Inc.), which was formed in Delaware in 2007, and Interpace Pharma Solutions, Inc., which was formed in
+Delaware in 2019 as Interpace BioPharma, Inc. On November 12, 2019, we changed the name of Interpace Diagnostics Group, Inc. to Interpace
+Biosciences, Inc. and that of subsidiary, Interpace BioPharma, Inc. to Interpace Pharma Solutions, Inc. Our executive offices are located
+at Morris Corporate Center 1, Building C, 300 Interpace Parkway, Parsippany, New Jersey 07054. Our telephone number is (855) 776-6419.
+
+ 
+
+ 
+
+ 13
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+
+ Rights
+ Offering Summary
+
+ 
+
+ The
+ following summary describes the principal terms of the Rights Offering, but is not intended to be complete. See the information under
+ the heading Description of the Rights Offering in this prospectus for a more detailed description of the terms and
+ conditions of the Rights Offering.
+
+ 
+ 
+ 
+
+ 
+ Securities
+ to be Offered
+ We
+ are distributing to you, at no charge, non-transferable Subscription Rights to purchase shares
+ of our common stock. You will receive one Subscription Right for each share of common stock
+ owned (including each share of common stock underlying the Eligible Warrants) as of
+ 5:00 p.m., New York City Time, on the Record Date. Holders of Eligible Warrants are entitled
+ to receive Subscription Rights without the exercise of the related warrants(subject to certain beneficial ownership limitations).
+
+ 
+
+ For
+ each share of common stock held (including each share of common stock underlying the Eligible Warrants), you will be entitled
+ to receive one Subscription Right.
+
+ 
+ 
+ 
+
+ 
+ Basic
+ Subscription Rights
+ Each
+ Subscription Right will entitle a holder to purchase 0.75 shares of our common stock at a Subscription Price of $[ ]
+ per whole share. We will not issue fractional shares in this Rights Offering. If the number of Subscription Rights you
+ exercise would otherwise permit you to purchase a fraction of a share, the number of shares you may purchase will be rounded down
+ to the nearest whole share.
+
+ 
+ 
+ 
+
+ 
+ Over-Subscription
+ Privilege
+ If,
+ and only if, you fully exercise your Basic Subscription Rights, you will also be able to exercise an Over-Subscription Privilege,
+ which will allow you to purchase additional shares of common stock that remain unsubscribed at the expiration of the Rights Offering,
+ subject to the availability and pro rata allocation of shares among all holders validly exercising this Over-Subscription
+ Privilege. You must state your intention to exercise your Over-Subscription Privilege at the same time that you exercise your Basic
+ Subscription Rights. The shares sold through the Over-Subscription Privilege will be sold at the same Subscription Price applicable
+ to the basic Subscription Right.
+
+ 
+ 
+ 
+
+ 
+ Proration
+ of Over-Subscription Privilege
+ If
+ there are not enough shares of our common stock available to satisfy all subscriptions made under the Over-Subscription Privilege,
+ we will allocate the remaining shares of our common stock pro rata, after eliminating all fractional shares, among those holders
+ exercising the Over-Subscription Privilege. For more information regarding proration, including the precise formula for how your
+ Subscription Rights pursuant to your Over-Subscription Privilege may be prorated, see Description of the Rights Offering Pro
+ Rata Allocation. 
+
+ 
+ 
+ 
+
+ 
+ Size
+ of Offering
+ Approximately
+ 4,184,707 shares of common stock issuable
+ upon exercise of Subscription Rights (which number is the maximum amount of shares of common stock available for purchase pursuant
+ to the exercise of Subscription Rights based on an estimated 4,174,962 shares of common stock and 1,404,648 Eligible Warrants
+ outstanding as of the Record Date).
+
+ 
+ 
+ 
+
+ 
+ Subscription
+ Price
+ $[ ]
+ per share.
+
+ 
+ 
+ 
+
+ 
+ Non-Transferability
+ of Subscription Rights
+ The
+ Subscription Rights may not be sold, transferred or assigned and will not be quoted for trading on the OTC Markets quotation system
+ or on any other stock exchange or market.
+
+ 
+ 
+ 
+
+ 
+ Record
+ Date
+ 5:00
+ p.m., New York City Time, on January 10, 2022.
+
+ 
+ 
+
+ 
+
+ 14
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+
+ 
+ Expiration
+ Date
+ The
+ Subscription Rights will expire if they are not exercised before 5:00 p.m., New York City Time, on [ ], 2022, unless
+ the Rights Offering is extended or earlier terminated by us in our sole discretion.
+
+ 
+ 
+ 
+
+ 
+ Participation
+ of the Eligible Warrant Holders
+ Holders
+ of our outstanding warrants issued by us on January 25, 2017, March 22, 2017, June 21, 2017,
+ October 12, 2017 and January 25, 2019 have the contractual right to participate in this Rights
+ Offering. Each such holder of Eligible Warrants will receive one subscription right for each
+ share of common stock underlying such holder s warrant. A total of 1,404,648 Subscription
+ Rights will be issued to these warrant holders.
+
+ 
+
+Holders
+of Eligible Warrants (together with affiliates as determined in accordance with the applicable warrant) are not eligible to exercise
+Subscription Rights relating to the Eligible Warrants to the extent the holder would own more than 4.99% (up to 9.99% at the election
+of the holder) of the outstanding common stock of the Company after participation in the Rights Offering.
+
+ 
+ 
+ 
+
+ 
+ 
+
+ Procedure
+ for Exercising Subscription Rights
+
+ 
+
+ To
+ exercise your Subscription Rights, you must take the following steps:
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ If
+ you are a record holder of our common stock or the holder of an Eligible Warrant,
+ you must properly complete and execute the Subscription Rights Certificate and forward
+ it, together with your full Subscription Payment and, if applicable, notice of guaranteed
+ delivery, to the Subscription Agent to be received before 5:00 p.m., New York City Time,
+ on the Expiration Date.
+
+ 
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ If
+ you are a beneficial owner of shares of our common stock or the holder of an Eligible Warrant, meaning your shares
+ of common stock or your Eligible Warrant are registered in the name of a broker, dealer, bank, or other nominee, you will
+ not receive a Subscription Rights Certificate. Instead, we will issue one Subscription Right to such nominee record holder for each
+ share of our common stock (including shares underlying the Eligible Warrants) held by such nominee at the Record Date. If
+ you are not contacted by your nominee, you should promptly contact your nominee in order to subscribe for shares of common stock
+ in the Rights Offering and follow the instructions provided by your nominee.
+
+ 
+ 
+ 
+
+ 
+ Issuance
+ of Common Stock
+ We
+ intend to issue the shares of common stock in book-entry, or uncertificated, form to each subscriber as soon as practicable after
+ completion of the Rights Offering. If you are the holder of record of our common stock or the holder of an Eligible Warrant,
+ you will receive a direct registration, or DRS, account statement from our transfer agent, American Stock Transfer & Trust Company,
+ LLC, reflecting your ownership of the shares of common stock that you have purchased in the Rights Offering. If you hold your shares
+ of common stock or Eligible Warrant in the name of a broker, dealer, bank, or other nominee who uses the services of DTC,
+ DTC will credit your account with your nominee with the securities you purchase in the Rights Offering. 
+
+ 
+ 
+ 
+
+ 
+ Non-Transferability
+ of Subscription Rights
+ The
+ Subscription Rights may not be sold, transferred or assigned and will not be quoted for trading on the OTC Markets quotation system
+ or on any other stock exchange or market.
+
+ 
+ 
+ 
+
+ 
+ No
+ Board Recommendation
+ Neither
+ our Board of Directors nor our management has made any recommendation regarding your exercise of the Subscription Rights. Subscription
+ Rights holders who exercise Subscription Rights will incur investment risk on new money invested. You are urged to make your decision
+ to invest based on your own assessment of our business and financial condition, our prospects for the future, the terms of the Rights
+ Offering, the information in this prospectus and other information relevant to your circumstances. 
+
+ 
+ 
+
+ 
+
+ 15
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+
+ 
+ Existing
+ Stockholder Participation
+ Pursuant
+ to the Standby Purchase Agreement, dated January [ ], 2022, the
+ Investors have agreed to purchase their pro rata share of common stock in the Rights Offering pursuant to the exercise of
+ their Basic Subscription Rights issued to them in the Rights Offering. In addition, the Standby Purchaser has agreed to purchase
+ any and all of the shares of common stock offered pursuant to Subscription Rights which remain unsubscribed for at expiration of
+ the Rights Offering in accordance with the Standby Purchase Agreement in a private placement pursuant to Section 4(a)(2) of the Securities
+ Act. The Investors as a group beneficially own approximately 18.7% of our outstanding shares of common stock as of the Record Date
+ or 6.5% of our fully-diluted shares of common stock (assuming the conversion of all outstanding Series B Preferred Stock). See The
+ Standby Purchase Agreement for more information.
+
+ 
+ 
+ 
+
+ 
+ Revocation
+ If
+ you exercise your Subscription Rights, you (or your nominee) may revoke such exercise before 5:00 p.m., New York City Time, on the
+ Expiration Date by following the instructions herein. If the Expiration Date is extended, you (or your nominee) may revoke your exercise
+ of Subscription Rights at any time before 5:00 p.m., New York City Time, on the final Expiration Date as so extended. See The
+ Rights Offering Revocation Rights. 
+
+ 
+ 
+ 
+
+ 
+ Use
+ of Proceeds
+ Assuming
+ all of the 4,184,707 shares of common stock offered will be sold in
+ the Rights Offering based on the combined exercise of the Basic Subscription Rights and Over-Subscription
+ Privilege, we estimate that the net proceeds from the Rights Offering will be approximately
+ $[ ] million, based on a Subscription Price of $[ ] per share and after deducting
+ other expenses payable by us. Assuming only the Investors purchase their pro rata shares
+ of common stock at a Subscription Price of $[ ] per share (and no holders exercise
+ their Over-Subscription Privilege in the Rights Offering) and assuming completion of the
+ Standby Purchase Commitment for [ ] shares at a price per share equal to the
+ Subscription Price less $0.15, we estimate that the net proceeds from the Rights Offering
+ and Standby Purchase Commitment will be approximately $[ ] million after deducting
+ estimated expenses payable by us.
+
+ 
+
+ We
+ intend to use the net proceeds from this offering to increase our liquidity position, to fund our anticipated internal and external
+ growth through potential strategic investments and partnerships, including product line acquisitions, and for working capital and general corporate purposes. See Use
+ of Proceeds in this prospectus.
+
+ 
+ 
+ 
+
+ 
+ Material
+ U.S. Federal Income Tax Considerations
+ Although
+ the authorities governing transactions such as the Rights Offering are complex and unclear in certain respects, for U.S. federal
+ income tax purposes, we believe and intend to take the position that you generally should not recognize income or loss in connection
+ with the receipt or exercise of Subscription Rights in the Rights Offering. You should consult your own tax advisor as to the tax
+ consequences of the Rights Offering to you in light of your particular circumstances. See Material U.S. Federal Income
+ Tax Considerations. 
+
+ 
+ 
+ 
+
+ 
+ Extension
+ and Termination
+ Although
+ we do not presently intend to do so, we may extend the Rights Offering for additional time in our sole discretion; provided,
+ however, that we may not extend the Expiration Date of the Rights Offering by more than 30 days past the original Expiration
+ Date. Our Board of Directors may decide to terminate the Rights Offering at any time and for any reason before the expiration of
+ the Rights Offering.
+
+ 
+ 
+ 
+
+ 
+ Market
+ for Common Stock
+ Our
+ common stock is quoted on the OTCQX market of the OTC under the symbol IDXG. The common stock to be issued in the
+ Rights Offering, like our existing shares of common stock, will be quoted on the OTCQX market under the same symbol.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/ILAG_intelligen_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/ILAG_intelligen_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/ILAG_intelligen_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/IMMX_immix_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/IMMX_immix_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..32a459221258679dd0aa16253b8690f959f730f4
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/IMMX_immix_prospectus_summary.txt
@@ -0,0 +1,376 @@
+prospectus summary. Some of
+these risks include the following:
+
+ 
+
+ 
+ 
+ 
+ 
+ We
+ have incurred substantial losses since our inception and anticipate that we will continue to incur substantial and increasing losses
+ for the foreseeable future.
+
+ 
+ 
+ 
+ We
+ need significant additional financing to fund our operations and complete the development and, if approved, the commercialization
+ of our product candidates. If we are unable to raise capital when needed, we could be forced to delay, reduce or eliminate our product
+ development programs or commercialization efforts.
+
+ 
+ 
+ 
+ Raising
+ additional capital may cause dilution to our existing stockholders, restrict our operations or require us to relinquish rights to
+ our product candidates on unfavorable terms to us.
+
+ 
+ 
+ 
+ We
+ have a limited number of product candidates, all which are still in early clinical or pre-clinical development. If we do not obtain
+ regulatory approval of one or more of our product candidates, or experience significant delays in doing so, our business will be
+ materially adversely affected.
+
+ 
+ 
+ 
+ Clinical
+ trials are expensive, time consuming, difficult to design and implement, and involve uncertain outcomes. Results of previous pre-clinical
+ studies and clinical trials may not be predictive of future results, and the results of our current and planned clinical trials may
+ not satisfy the requirements of the FDA or other regulatory authorities.
+
+ 
+ 
+ 
+ We
+ may find it difficult to enroll patients in our clinical trials given the limited number of patients who have the diseases for which
+ our product candidates are being studied which could delay or prevent the start of clinical trials for our product candidates.
+
+ 
+ 
+ 
+ Our
+ product candidates may have undesirable side effects that may delay or prevent marketing approval or, if approval is received, require
+ them to be taken off the market, require them to include safety warnings or otherwise limit their sales.
+
+ 
+ 
+ 
+ We
+ are dependent on third parties for manufacturing and marketing of our product candidates. If we are not able to secure favorable
+ arrangements with such third parties or the third parties upon whom we rely do not perform, including failure to perform to our specifications
+ or comply with applicable regulations, our business and financial condition could be harmed.
+
+ 
+ 
+ 
+ If
+ any of our product candidates receive regulatory approval, the approved products may not achieve broad market acceptance among physicians,
+ patients, the medical community and third-party payors, in which case revenue generated from their sales would be limited.
+
+ 
+ 
+ 
+ Even
+ if we receive regulatory approval to commercialize any of the product candidates that we develop, we will be subject to ongoing regulatory
+ obligations and continued regulatory review, which may result in significant additional expense.
+
+ 
+
+ -9-
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ If
+ any product liability lawsuits are successfully brought against us, we may incur substantial liabilities and may be required to limit
+ commercialization of our product candidates.
+
+ 
+ 
+ 
+ Current
+ and future legislation may increase the difficulty and cost for us to obtain marketing approval of and commercialize our product
+ candidates and affect the prices we may obtain for such product candidates. If we fail to comply with regulations, we could face
+ substantial enforcement actions, including civil and criminal penalties and our business, operations and financial condition could
+ be adversely affected.
+
+ 
+ 
+ 
+ If
+ the market opportunities for our current and potential future product candidates are smaller than we believe they are, our ability
+ to generate product revenue may be adversely affected and our business may suffer.
+
+ 
+ 
+ 
+ Our
+ products will face significant competition, and if they are unable to compete successfully, our business will suffer.
+
+ 
+ 
+ 
+ Any
+ international operations we undertake may subject us to risks inherent with operations outside of the United States.
+
+ 
+ 
+ 
+ We
+ may be subject to claims that our employees, consultants or independent contractors have wrongfully used or disclosed alleged trade
+ secrets.
+
+ Our
+ intellectual property may not be sufficient to protect our product candidates from competition,
+ which may negatively affect our business. We may incur substantial costs as a result of litigation
+ or other proceedings relating to patents and other intellectual property rights.
+
+ We
+ are currently listed on The Nasdaq Capital Market. If we are unable to maintain listing of
+ our securities on Nasdaq or any stock exchange, our stock price could be adversely affected
+ and the liquidity of our stock and our ability to obtain financing could be impaired and
+ it may be more difficult for our stockholders to sell their securities.
+
+ Substantial
+ amounts of our outstanding shares may be sold into the market when lock-up or market standoff
+ periods end. If there are substantial sales of shares of our common stock, the price of our
+ common stock could decline.
+
+ Because
+ certain of our stockholders control a significant number of shares of our common stock, they
+ may have effective control over actions requiring stockholder approval.
+
+ 
+
+Corporate
+Information
+
+ 
+
+We
+were incorporated as a California limited liability company in 2012 and converted to a Delaware corporation in January 2014. In August
+2016, we established a wholly-owned Australian subsidiary, Immix Biopharma Australia Pty Ltd., in order to conduct various pre-clinical
+and clinical activities for the development of our product candidates. Our principal executive offices are located at 11400 West Olympic
+Blvd., Suite 200, Los Angeles, CA 90064 and our telephone number is (310) 651-8041. Our website address is www.immixbio.com. The
+information contained on our website is not incorporated by reference into this prospectus, and you should not consider any information
+contained on, or that can be accessed through, our website as part of this prospectus or in deciding whether to purchase our common shares.
+
+ 
+
+Implications
+of Being an Emerging Growth Company and a Smaller Reporting Company
+
+ 
+
+As
+a company with less than $1.07 billion in revenues during our last fiscal year, we qualify as an emerging growth company as defined in
+the JOBS Act. As an emerging growth company, we expect to take advantage of reduced reporting requirements that are otherwise applicable
+to public companies. These provisions include, but are not limited to:
+
+ 
+
+ 
+ 
+ 
+ 
+ being
+ permitted to present only two years of audited financial statements, in addition to any required unaudited interim financial statements,
+ with correspondingly reduced Management s Discussion and Analysis of Financial Condition and Results of Operations 
+ disclosure in this prospectus;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ not
+ being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended ( Sarbanes-Oxley
+ Act );
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ reduced
+ disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ exemptions
+ from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute
+ payments not previously approved; and
+
+ 
+
+ 
+
+ -10-
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ 
+ an
+ exemption from compliance with the requirements of the Public Company Accounting Oversight Board regarding the communication of critical
+ audit matters in the auditor s report on financial statements.
+
+ 
+ 
+
+We
+may use these provisions until the last day of our fiscal year following the fifth anniversary of the completion of our IPO. However,
+if certain events occur prior to the end of such five-year period, including if we become a large accelerated filer, our
+annual gross revenues exceed $1.07 billion or we issue more than $1.0 billion of non-convertible debt in any three-year period, we will
+cease to be an emerging growth company prior to the end of such five-year period.
+
+ 
+
+The
+JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised
+accounting standards. As an emerging growth company, we intend to take advantage of an extended transition period for complying with
+new or revised accounting standards as permitted by the JOBS Act. As a result of the accounting standards election, we will not be subject
+to the same implementation timing for new or revised accounting standards as other public companies that are not emerging growth companies,
+which may make comparison of our financial statements to those of other public companies more difficult.
+
+ 
+
+To
+the extent that we continue to qualify as a smaller reporting company, as such term is defined in Rule 12b-2 under the
+Securities Exchange Act of 1934, as amended ( Exchange Act ), after we cease to qualify as an emerging growth company, certain
+of the exemptions available to us as an emerging growth company may continue to be available to us as a smaller reporting company, including:
+
+ 
+
+ 
+ 
+ 
+ 
+ not
+ being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes Oxley Act;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ scaled
+ executive compensation disclosures; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ the
+ requirement to provide only two years of audited financial statements, instead of three years.
+
+ 
+ 
+
+ -11-
+
+ 
+
+ 
+
+ 
+
+THE
+OFFERING
+
+ 
+
+ 
+ Shares
+ being offered
+ 
+ 1,683,502
+ shares of common stock at an assumed
+ public offering price of $2.97 per share, the last reported sale price of our common stock as reported on The Nasdaq Capital
+ Market on May 26, 2022.
+
+ 
+ 
+ 
+ 
+
+ 
+ Underwriters 
+ over-allotment option
+ 
+ We
+ have granted the underwriters a 45 day option from the date of this prospectus to purchase up to an additional 252,525 shares
+ of common stock (15% of the total number of shares of common stock to be offered by us in the offering).
+
+ 
+ 
+ 
+ 
+
+ 
+ Number
+ of shares of common stock to be outstanding after this offering (1)
+ 
+ 15,568,506
+ shares (or 15,821,031 shares if the underwriters
+ exercise the option to purchase additional shares in full).
+
+ 
+ 
+ 
+ 
+
+ 
+ Use
+ of proceeds
+ 
+ We
+ expect to receive net proceeds, after deducting underwriting discounts and commissions and estimated expenses payable by us, of approximately
+ $4.3 million (or approximately $5.0 million if the underwriters exercise their option to purchase additional shares
+ in full), assuming a public offering price of $2.97 per share, the last reported sale price of our common stock on The Nasdaq
+ Capital Market on May 26, 2022. We intend to use the net proceeds from this offering to fund additional patients enrolled
+ into our planned IMX-110 Phase 2a clinical trial in STS and additional patients across various solid tumors enrolled into our IMX-110
+ + tislelizumab Phase 1b combination trial, and for working capital and other general corporate purposes. We may also use a portion
+ of the net proceeds to in-license, acquire or invest in complementary businesses or products, however, we have no current commitments
+ or obligations to do so. See Use of Proceeds for a more complete description of the intended use of proceeds from this
+ offering.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/IMPPP_imperial_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/IMPPP_imperial_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..ebd8cf5bc12efd5fca3588d0151eb707dddcab82
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/IMPPP_imperial_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information that appears later in this prospectus and is qualified in its entirety by the more detailed information and financial statements included elsewhere in this prospectus. This summary may not contain all of the information that may be important to you. As an investor or prospective investor, you should carefully review the entire prospectus, including the section of this prospectus entitled Risk Factors and the more detailed information that appears later in this prospectus before making an investment in our securities. Imperial Petroleum Inc. was incorporated under the laws of the Republic of the Marshall Islands on May 14, 2021, by StealthGas Inc. ( StealthGas ) to serve as the holding company of four subsidiaries, each owning one of the tanker vessels in our initial fleet, that it subsequently contributed to us in connection with the Spin-Off (as defined below). On December 3, 2021, StealthGas distributed all of our outstanding shares of common stock, par value $0.01 per share ( common stock ), and 8.75% Series A Cumulative Redeemable Perpetual Preferred Stock, par value $0.01 per share, liquidation preference $25.00 per share ( Series A Preferred Stock ), to its stockholders, which completed our separation from StealthGas (the Spin-Off ). Unless otherwise indicated, references to Imperial Petroleum, the Company, we, our, us or similar terms refer to the registrant, Imperial Petroleum Inc., and its subsidiaries, except where the context otherwise requires. We use the term deadweight tons ( dwt ), expressed in metric tons, each of which is equivalent to 1,000 kilograms, in describing the size of our vessels. Unless otherwise indicated, all references to U.S. dollars, dollars, U.S. $ and $ in this prospectus are to the lawful currency of the United States of America. Overview We are a provider of international seaborne transportation services to oil producers, refineries and commodities traders. We own and operate a fleet of five medium range ( MR ) refined petroleum product tankers that carry refined petroleum products such as gasoline, diesel, fuel oil and jet fuel, as well as edible oils and chemicals, and two Suezmax tankers and one Aframax tanker which are used for carrying crude oil. The total cargo carrying capacity of our fleet is 672,804 dwt. Upon the completion of the Spin-Off on December 3, 2021, we began operating as a separate company from StealthGas, the Nasdaq-listed ship-owning company serving the liquefied petroleum gas ( LPG ) sector of the international shipping industry, of which we were previously a part. Our Fleet As of June 17, 2022, the profile and deployment of our fleet is the following: Name Year Built Country Built Vessel Size (dwt) Vessel Type Employment Status Daily Charter Rate Expiration of Charter(1) Clean Nirvana 2008 Korea 50,000 MR product tanker Spot Magic Wand 2008 Korea 47,000 MR product tanker Time Charter $ 14,500 May 2023 Clean Justice 2011 Japan 47,000 MR product tanker Time Charter $ 28,000 September 2022 Clean Thrasher 2008 Korea 47,000 MR product tanker Spot Falcon Maryam 2009 Korea 46,000 MR product tanker Bareboat $ 7,800 September 2022 Stealth Berana 2010 Korea 115,804 Aframax oil tanker Time Charter $ 33,000 June 2022 Suez Enchanted 2007 Korea 160,000 Suezmax oil tanker Spot Suez Protopia 2008 Korea 160,000 Suezmax oil tanker Spot Fleet Total 672,804 Table of Contents (1) Earliest date charters could expire. We plan to expand our fleet by investing in vessels, which may include vessels in other seaborne transportation sectors in addition to the product and crude tanker sectors, under favorable market conditions; and, as described above, have recently acquired two MR product tankers and two Suezmax crude oil tankers. We also intend to take advantage of the cyclical nature of the market by buying and selling ships when we believe favorable opportunities exist. We will deploy our fleet on a mix of period charters, including time and bareboat charters which can last up to several years, and spot market charters, which generally last from one to six months, according to our assessment of market conditions. The Vafias family, of which our President and Chief Executive Officer, Harry Vafias, is a member, has been active in shipping for over 40 years. The Vafias family formed Stealth Maritime Corporation S.A. ( Stealth Maritime ) in 1999, which, as our fleet manager, is responsible for all aspects of our administration and operations under the direction of our Board of Directors. During 2021, StealthGas and affiliates of our Manager, Stealth Maritime, owned or partially owned in total 76 vessels (including 21 tankers). Management of Our Fleet All of our vessels are managed by Stealth Maritime, a company controlled by members of the Vafias family, of which our Chief Executive Officer is a member. We have a management agreement with Stealth Maritime pursuant to which Stealth Maritime provides us with technical, administrative, commercial and certain other services. In relation to the technical services, Stealth Maritime is responsible for arranging for the crewing of the vessels, the day to day operations, inspections and vetting, maintenance, repairs, drydocking and insurance. Administrative functions include but are not limited to accounting, back-office, reporting, legal and secretarial services. In addition, Stealth Maritime provides services for the chartering of our vessels and monitoring thereof, freight collection, and sale and purchase. In providing most of these services, Stealth Maritime pays third parties and receives reimbursement from us. In addition, Stealth Maritime subcontracts technical management and crew management for some of our vessels to third parties, including Hellenic Manning Overseas Inc. and Bernard Shulte Management based in Athens. These technical managers are supervised by Stealth Maritime. Our management agreement, which we entered into in conjunction with our separation from StealthGas and the Spin-Off, is substantially similar to the management agreement between StealthGas and Stealth Maritime relating to our vessels that were previously owned by StealthGas, including providing for the same fee levels. Under our management agreement we pay Stealth Maritime a fixed management fee of $440 per vessel operating under a voyage or time charter per day on a monthly basis in advance, pro-rated for the calendar days we own the vessels. We pay a fixed fee of $125 per vessel per day for each of our vessels operating on bareboat charter. We are also be obligated to pay Stealth Maritime a fee equal to 1.25% of the gross freight, demurrage and charter hire collected from the employment of our vessels. Stealth Maritime will also earn a fee equal to 1.0% of the contract price of any vessel bought or sold by them on our behalf. Additional vessels that we may acquire in the future may be managed by Stealth Maritime or by other unaffiliated management companies. The initial term of our management agreement with Stealth Maritime will expire on December 31, 2025. Unless six months notice of non-renewal is given by either party prior to the end of the then current term, this agreement will automatically extend for additional 12-month periods. See Item 7. Major Stockholders and Related Party Transactions B. Related Party Transactions Management and Other Fees in our Annual Report on Form 20-F for the year ended December 31, 2021 incorporated by reference herein for additional information regarding the management agreement, including management fees and termination provisions. Table of Contents
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/INAB_in8bio-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/INAB_in8bio-inc_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/INAB_in8bio-inc_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/INDI_indie_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/INDI_indie_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/INDI_indie_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/INLX_intellinet_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/INLX_intellinet_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..229abfcdd87d5fda56832282f97879920ebe1257
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/INLX_intellinet_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 3
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/ISPOW_inspirato_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/ISPOW_inspirato_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/ISPOW_inspirato_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/IVAWF_investcorp_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/IVAWF_investcorp_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..261926822e5f62e8a4d22ace0eaa792449f607de
--- /dev/null
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@@ -0,0 +1 @@
+S-1/A 1 d159165ds1a.htm S-1/A S-1/A Table of Contents As filed with the Securities and Exchange Commission on April 29, 2022 Registration No. 333-257090 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 AMENDMENT NO. 4 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Investcorp India Acquisition Corp (Exact name of registrant as specified in its charter) Cayman Islands 6770 N/A (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) Century Yard, Cricket Square Elgin Avenue PO Box 1111 George Town Grand Cayman, Cayman Islands KY1-1102 +1 (345) 949-5122 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Puglisi & Associates 850 Library Ave., Suite 204 Newark, Delaware 19711 (302) 738-7210 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Michael J. Blankenship David A. Sakowitz J. Eric Johnson Winston & Strawn LLP 800 Capitol Street, Suite 2400 Houston, TX 77002 United States Tel: +1 713 651 2600 Bradley Kruger Ogier 89 Nexus Way Camana Bay Grand Cayman, Cayman Islands KY1-9009 Tel: +1 345 949 9876 Leo Borchardt Davis Polk & Wardwell London LLP 5 Aldermanbury Square London EC2V 7HR United Kingdom Tel: +44 20 7418 1300 Derek Dostal Davis Polk Wardwell LLP 450 Lexington Avenue New York, New York 10017 United States Tel: +1 212 450 4000 Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment that specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Table of Contents We are responsible for the information contained in this prospectus. We have not authorized anyone to provide any information or to make any representations other than those contained in this prospectus. We and the underwriter take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the units offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date. TABLE OF CONTENTS Page SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/JUSHF_jushi_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/JUSHF_jushi_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..dc8478de568d92630abfeae13ce2efba6fbc63b3
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/JUSHF_jushi_prospectus_summary.txt
@@ -0,0 +1 @@
+S-1/A 1 tm226236d8_s1a.htm FORM S-1/A As filed with the Securities and Exchange Commission on August 5, 2022 Registration No. 333-266287 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 AMENDMENT NO. 1 TO FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 JUSHI HOLDINGS INC. (Exact Name of Registrant as Specified in Its Charter) British Columbia 2833 98-1547061 (State or Other Jurisdiction of Incorporation or Organization) (Primary Standard Industrial Classification Code No.) (I.R.S. Employer Identification No.) 301 Yamato Road, Suite 3250 Boca Raton, FL 33431 (516) 617-9100 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) James Cacioppo Chairman and Chief Executive Officer Jushi Holdings Inc. 301 Yamato Road, Suite 3250 Boca Raton, FL 33431 (516) 617-9100 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Tobi Lebowitz, Esq. Jushi Holdings Inc. 301 Yamato Road, Suite 3250 Boca Raton, FL 33431 (516) 617-9100 W. Stuart Ogg, Esq. Goodwin Procter LLP 601 Marshall Street Redwood City, CA 94063 (650) 752-3100 Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement is declared effective. If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, as amended (the "Securities Act") check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. The information in this preliminary prospectus is not complete and may be changed. The selling shareholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to Completion Preliminary Prospectus dated August 5, 2022 PROSPECTUS 48,260,954 Subordinate Voting Shares This prospectus relates to the sale or other disposition from time to time of up to 48,260,954 subordinate voting shares, no par value (Subordinate Voting Shares), consisting of: (i) 7,491,952 Subordinate Voting Shares issuable upon exercise of outstanding options issued under the Company's equity plan, (ii) 661,607 Subordinate Voting Shares issued upon the exercise of options issued under the Company s equity plan, (iii) 1,538,326 Subordinate Voting Shares issued as restricted stock awards under the Company's equity plan, (iv) 715,846 Subordinate Voting Shares issued upon exercise of warrants issued in connection with services rendered to the Company; (v) 1,535,000 Subordinate Voting Shares issuable upon exercise of outstanding warrants issued in connection with services provided to the Company; (vi) 6,900,000 Subordinate Voting Shares issuable upon exercise of outstanding warrants issued in connection with the Company's 10% Senior Secured Notes; (vii) 1,311,555 Subordinate Voting Shares issued upon exercise of warrants issued in connection with the Company's 10% Senior Secured Notes; (viii) 11,575,000 Subordinate Voting Shares issuable upon exercise of outstanding warrants issued in private placement transactions; (ix) 198,468 Subordinate Voting Shares issued upon the exercise of warrants issued in private placement transactions; and (x) 16,333,200 Subordinate Voting Shares issued in private placement and acquisition transactions held by the selling shareholders named in this prospectus. We are not selling any Subordinate Voting Shares under this prospectus and will not receive any of the proceeds from the sale of Subordinate Voting Shares by the selling shareholders. This is the first public offering of our securities in the United States. We have four classes of authorized shares: Subordinate Voting Shares, Multiple Voting Shares, Super Voting Shares and Preferred Shares. The terms and conditions of the Subordinate Voting Shares, Multiple Voting Shares and Super Voting Shares are identical except with respect to voting and conversion rights. The terms and conditions of the Preferred Shares will be determined by our board of directors, if, as and when such Preferred Shares are issued. Currently only Subordinate Voting Shares are issued and outstanding. See "Description of Capital Stock." The selling shareholders may sell or otherwise dispose of the Subordinate Voting Shares covered by this prospectus in a number of different ways and at varying prices. The prices at which the selling shareholders may sell the Subordinate Voting Shares will be determined by the prevailing market price for the Subordinate Voting Shares or in negotiated transactions. We provide more information about the selling shareholders and how they may sell or otherwise dispose of their Subordinate Voting Shares in the sections entitled "Selling Shareholders" and "Plan of Distribution" on pages 29 and 113, respectively, of this prospectus. The selling shareholders will pay all brokerage fees and commissions and similar expenses. We will pay all expenses (except brokerage fees and commissions and similar expenses) relating to the registration of the Subordinate Voting Shares with the Securities and Exchange Commission. Our Subordinate Voting Shares are listed on the Canadian Securities Exchange (the CSE) under the symbol "JUSH" and quoted on the OTCQX Best Market under the symbol "JUSHF." The last reported sale price of our Subordinate Voting Shares on the CSE on August 4, 2022 was C$2.48 per share and on the OTCQX Best Market on August 4, 2022 was $1.98 per share. Investing
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/KNOS_kronos_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/KNOS_kronos_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..971d55b17a86250ecb2504b9a9f02496e55a8d54
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/KNOS_kronos_prospectus_summary.txt
@@ -0,0 +1,97 @@
+PROSPECTUS SUMMARY
+ 6
+
+ 
+ RISK FACTORS
+ 16
+
+ 
+ USE OF PROCEEDS
+ 28
+
+ 
+ DETERMINATION OF OFFERING PRICE
+ 28
+
+ 
+ DILUTION
+ 28
+
+ 
+ THE PRIVATE PLACEMENT TRANSACTION
+ 29
+
+ 
+ SELLING STOCKHOLDERS
+ 30
+
+ 
+ PLAN OF DISTRIBUTION
+ 31
+
+ 
+ DESCRIPTION OF SECURITIES
+ 33
+
+ 
+ EXPERTS AND COUNSEL
+ 34
+
+ 
+ INTERESTS OF NAMED EXPERTS AND COUNSEL
+ 34
+
+ 
+ INFORMATION WITH RESPECT TO OUR COMPANY
+ 35
+
+ 
+ DESCRIPTION OF PROPERTY
+ 40
+
+ 
+ LEGAL PROCEEDINGS
+ 40
+
+ 
+ MARKET FOR COMMON EQUITY AND RELATED SHAREHOLDER MATTERS
+ 40
+
+ 
+ DIVIDEND POLICY
+ 40
+
+ 
+ FINANCIAL STATEMENTS
+ 42
+
+ 
+ MANAGEMENT S DISCUSSION AND ANALYSIS
+ 43
+
+ 
+ SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
+ 53
+
+ 
+ CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
+ 56
+
+ 
+ EXPERTS
+ 57
+
+ 
+ DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
+ 57
+
+ 
+ 
+
+Please
+read this Prospectus carefully. It describes our business, our financial condition, and the results of operations. We have prepared this
+Prospectus to have the information necessary to make an informed investment decision.
+
+ 
+
+ 3
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/LDDD_longduoduo_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/LDDD_longduoduo_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/LDDD_longduoduo_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/LGHL_lion_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/LGHL_lion_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..bae021a0ebfd7369d55a41644e46bd3bef5f3882
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/LGHL_lion_prospectus_summary.txt
@@ -0,0 +1 @@
+Lion Group Holding Ltd is incorporated in Cayman Islands. As a holding company, we may rely on dividends and other distributions on equity paid by our subsidiaries in Hong Kong and the Cayman Islands for our cash and financing requirements. If any of our subsidiaries incurs debt on its own behalf in the future, the instruments governing such debt may restrict their ability to pay dividends to us. We did not pay any dividends to our shareholders for the year ended December 31, 2021. On December 5, 2019 and December 31, 2019, we declared dividends of US$2.6 million and US$2.4 million, respectively, to the then sole shareholder, which were utilized to reduce the amount due from shareholder by US$4.6 million to nil, resulting in dividends payable of US$0.4 million included in the consolidated balance sheet as of December 31, 2019. In 2020, dividends paid to the individual shareholder were US$386,000. For the fiscal year ended December 31, 2021, we did not pay any dividends to our shareholders. Our subsidiaries received an aggregate transfer of $2,150,000 and $28,302,204 for the period from June 16, 2020 to December 31, 2020 and for the year ended December 31, 2021, respectively, from the Company to fund their business operations. Our Company received an aggregate transfer of nil and $4,835,117 for the period from June 16, 2020 to December 31, 2020 and for the year ended December 31, 2021, respectively, from its subsidiaries. In the future, any cash proceeds raised from overseas financing activities, including this offering, may be transferred by us to our subsidiaries via capital contribution or shareholder loans, as the case may be. For a detailed description of the transfers from the Company to its subsidiaries and from its subsidiaries to the Company, see Transfers of Cash to and from Our Subsidiaries in the Summary of the Prospectus section and condensed consolidated schedule and consolidated financial statements starting from page F-1 of this prospectus. As a holding company with no material operations of our own, we conduct our substantial operations through our subsidiaries in Hong Kong and the Cayman Islands and our apps are available to download in the app stores of China and most of our users are PRC citizens, which may subject us to certain laws and regulations in China. As such, the Chinese government may exercise significant oversight and discretion over the conduct of our business and may intervene in or influence our operations at any time. Such governmental actions: could result in a material change in our operations; could hinder our ability to continue to offer securities to investors; and may cause the value of our ADSs to significantly decline or be worthless. Currently, we are not aware there are any material restrictions on foreign exchange, the ability to transfer cash between our entities, or the ability to distribute earnings to investors outside of China. Further, we are aware that recently, the Chinese government recently initiated a series of regulatory actions and statements to regulate business operations in China with little advance notice, including cracking down on illegal activities in the securities market, enhancing supervision over China-based companies listed overseas using entity variable interest entity ( VIE ) structure, adopting new measures to extend the scope of cybersecurity reviews, and expanding the efforts in anti-monopoly enforcement. Since these statements and regulatory actions are new, it is highly uncertain how soon legislative or administrative regulation making bodies will respond and what existing or new laws or regulations or detailed implementations and interpretations will be modified or promulgated, if any, and the potential impact such modified or new laws and regulations will have on the Company s business operations in China, the ability to accept foreign investments and list on an U.S. or other foreign exchange. Any future action by the Chinese government expanding the categories of industries and companies whose foreign securities offerings are subject to government review could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and could cause the value of such securities to significantly decline or be worthless. For a detailed description of the risks related to doing business in the PRC, and the offering, see Risks Related to Doing Business in Jurisdictions We Operate and Risks Related to our ADSs, our Securities and this Offering in the Risk Factors section. On December 16, 2021, the United States Public Company Accounting Oversight Board, or PCAOB, issued a Determination Report which found that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in: (i) China, and (ii) Hong Kong. Our auditor, UHY LLP, headquartered in New York, NY, is an independent registered public accounting firm with the PCAOB and has been inspected by the PCAOB on a regular basis. The PCAOB currently has access to inspect the working papers of our auditor. Our auditor is not headquartered in China or Hong Kong and was not identified in this report as a firm subject to the PCAOB s determination. On August 26, 2022, the China Securities Regulatory Commission, or CSRC, the Ministry of Finance of the PRC, and PCAOB signed a Statement of Protocol, or the Protocol, governing inspections and investigations of audit firms based in China and Hong Kong. Pursuant to the Protocol, the PCAOB has independent discretion to select any issuer audits for inspection or investigation and has the unfettered ability to transfer information to the SEC. However, uncertainties still exist whether this new framework will be fully complied with. Investing in our securities is highly speculative and involves a high degree of risk. See Risk Factors section beginning on page 19 of this prospectus for a discussion of information that should be considered in connection with an investment in our securities and in the documents incorporated by reference into this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued under this prospectus or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is September [ ], 2022. Table of Contents TABLE OF CONTENTS Page CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS ii SUMMARY OF THE PROSPECTUS 1
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diff --git a/parsed_sections/prospectus_summary/2022/LNKB_linkbancor_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/LNKB_linkbancor_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..b6a6bda3483c135c7a818a8e2205d177f397adaf
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/LNKB_linkbancor_prospectus_summary.txt
@@ -0,0 +1 @@
+This summary highlights selected information contained in greater detail elsewhere in this prospectus. This summary may not contain all of the information that you should consider before investing in our securities. You should carefully read this entire prospectus, including the sections entitled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations and our consolidated financial statements and the notes related thereto before making an investment decision. Some of the statements in this prospectus constitute forward-looking statements. See Cautionary Note Regarding Forward-Looking Statements. Our Company We are a Pennsylvania corporation headquartered in Camp Hill, Pennsylvania and formed in 2018 with a mission to positively impact lives through community banking. In October 2018, we completed the acquisition of Stonebridge Bank, which was subsequently named LINKBANK. In September 2021, LINKBANCORP and GNB Financial Services, Inc., or GNBF, completed a strategic combination, resulting in The Gratz Bank becoming our wholly owned subsidiary. We are a bank holding company registered under the Bank Holding Company Act of 1956, as amended, or the BHC Act. The Gratz Bank is a Pennsylvania state-chartered commercial bank offering personal and business lending and deposit services to individuals, families, nonprofit and business clients throughout Central and Southeastern Pennsylvania, primarily through our digital presence on the internet and 10 client solutions centers in Chester, Cumberland, Dauphin, Lancaster, Northumberland and Schuylkill Counties. In markets other than those serviced pre-Merger by The Gratz Bank, the Bank operates as LINKBANK, a division of The Gratz Bank. The Bank intends to legally change its name to LINKBANK in November 2022 to create one single brand, subject to the receipt of applicable regulatory approvals. Our community banking strategy seeks to provide our customers with personal service, financial sophistication and the full array of product offerings of a larger regional bank, focusing on developing local lending relationships funded by the generation of local retail and business deposits. We believe our culture of highly engaged employees enhances productivity and results in lower employee turnover, ultimately, leading to greater operational efficiencies and customer loyalty. We differentiate ourselves based on high touch, relationship building service, supported by the convenience of technology. Our high touch level of service led us to change how we think about bank branches. We call our branches solutions centers because our personnel are all trained across our full product offerings so they can quickly and efficiently serve our customers needs for loan or deposit products. We are committed to increasing our market share in the communities we serve by continuing to leverage available technology, existing branch locations, and new branch locations, and by considering other strategic opportunities in both the markets we serve and the surrounding areas. As of June 30, 2022, our consolidated assets, net loans, deposits and shareholders equity totaled $1.1 billion, $786.5 million, $902.4 million and $104.8 million, respectively. As a bank holding company, we are subject to the supervision of the Board of Governors of the Federal Reserve System, or FRB. We are required to file with the FRB reports and other information regarding our business operations and the business operations of our subsidiaries. As a state-chartered commercial bank, The Gratz Bank is subject to primary supervision, periodic examination and regulation by the Pennsylvania Department of Banking and Securities, or PADOBS, and by the Federal Deposit Insurance Corporation, or FDIC, as its primary federal bank regulator. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the Registration Statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED SEPTEMBER 9, 2022 PRELIMINARY PROSPECTUS 4,575,000 Shares COMMON STOCK This prospectus relates to the initial public offering of the common stock of LINKBANCORP, Inc., the holding company for The Gratz Bank, a Pennsylvania state-chartered commercial bank headquartered in Camp Hill, Pennsylvania. We are offering 4,575,000 shares of common stock. Prior to this offering, shares of our common stock were quoted on the Pink Open Market operated by the OTC Markets Group, Inc., or the Pink Market, under the symbol LNKB. On September 8, 2022, the last reported sales price for shares of our common stock as reported on the Pink Market was $9.50 per share. We have applied to list our common stock on the Nasdaq Capital Market under the symbol LNKB. We anticipate that the public offering price of our common stock will be between $8.00 and $9.50 per share. We are an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 and, as such, have elected to comply with certain reduced public company disclosure standards. Investing in our common stock involves risk. See Risk Factors beginning on page 33 of this prospectus to read about factors you should consider before investing in our common stock. Per Share Total Public offering price Underwriting discounts and commissions(1) Proceeds to us, before expenses (1) The offering of our common stock will be conducted on a firm commitment basis. See Underwriting for a description of all underwriting compensation payable and expense reimbursement in connection with this offering. The underwriters have an option to purchase up to an additional 686,250 shares from us at the public offering price, less the underwriting discount, within 30 days from the date of this prospectus. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. The shares of our common stock in this offering are not savings accounts, deposits or other obligations of any bank and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency. The underwriters expect to deliver the shares of our common stock against payment on or about , 2022, subject to customary closing conditions. The date of this prospectus is , 2022 Table of Contents business combination and was accounted for as a reverse acquisition using the acquisition method of accounting, in accordance with the provisions of FASB ASC 805 Business Combinations. As such, GNBF was the accounting acquirer and the Company was the accounting acquiree. LINKBANCORP issued 4.85 million common shares to GNBF shareholders which represented approximately 49.4% of the post-merger outstanding common shares of LINKBANCORP. We refer to the Company prior to the completion of the Merger in this prospectus as Legacy LINKBANCORP. The following diagram illustrates the legal and accounting reorganization that occurred as a result of the Merger: The Company s financial statements and results of operations for the year ended December 31, 2021 and interim period through June 30, 2022, included in this prospectus, include the results of operations of the combined companies on and after the effective date of the Merger. Results for periods before the effective date of the Merger for the Company for the year ended December 31, 2020 reflect only the consolidated results of GNBF, and do not include the results of operations of Legacy LINKBANCORP before the completion of the Merger. The Legacy LINKBANCORP financial statements and related financial results of operations for the years ended December 31, 2020 and December 31, 2019, and the interim period through June 30, 2021, included in this prospectus, reflect the results of operations of Legacy LINKBANCORP before the effective date of the Merger and do not include the results of GNBF before the completion of the Merger. See below under Summary Summary Historical Consolidated Financial Data of the Company and Summary Historical Consolidated Financial Data of Legacy LINKBANCORP for additional information regarding the summary historical consolidated financial data as of the dates and for the periods shown with respect to the Company and Legacy LINKBANCORP, respectively. This prospectus describes the specific details regarding this offering and the terms and conditions of our common stock being offered hereby and the risks of investing in our common stock. For additional information, please see the section entitled Where You Can Find Additional Information. You should not interpret the contents of this prospectus or any free writing prospectus to be legal, business, investment or tax advice. You should consult with your own advisors for that type of advice and consult with them about the legal, tax, business, financial and other issues that you should consider before investing in our common stock. Table of Contents Creating a Community Bank to Positively Impact its Community LINKBANCORP was organized in 2018 with a mission to positively impact lives through community banking. Members of the founding management team and board of directors had worked together with multiple financial institutions of various sizes, primarily focused in Central and Southeastern Pennsylvania, over a period of more than 20 years. Informed by these experiences, the founders sought to establish an entrepreneurial and growth-oriented community bank that would leverage talented relationship bankers, coupled with emerging innovations in technology, to meet the needs of the local community. Rather than organize a de novo bank to facilitate these objectives, in October 2018 LINKBANCORP acquired and recapitalized Stonebridge Bank, a community bank primarily serving Chester County, Pennsylvania, in a transaction conducted under the U.S. Bankruptcy Code, funded with proceeds from a private placement of common stock to friends and family. At the time of the acquisition of Stonebridge Bank, it had $55.2 million in total assets and one branch office. Stonebridge Bank had been party to a consent order with the FDIC and the PADOBS at the time of the acquisition, which was successfully resolved by the Company s management team, with the consent order terminated in February 2019. Table of Contents Table of Contents Unless otherwise stated, all information in this prospectus assumes that the underwriters have not exercised their option to purchase additional shares of common stock. Until , 2022 (the 25th day after the date of this prospectus), all dealers that buy, sell or trade shares of our common stock, whether or not participating in this offering, may be required to deliver a prospectus. This delivery requirement is in addition to a dealer s obligation to deliver a prospectus when acting as an underwriter and with respect to their unsold allotments or subscriptions. Market and Industry Data Within this prospectus, we reference certain market, industry and demographic data and other statistical information. We have obtained this data and information from various independent, third-party industry sources and publications. Nothing in the data or information used or derived from third party sources should be construed as advice. Some data and other information are also based on our good faith estimates, which are derived from our review of internal surveys and independent sources. We believe that these external sources and estimates are reliable, but have not independently verified them. Statements as to our market position are based on market data currently available to us. While we are not aware of any misstatements regarding the economic, employment, industry and other market data presented herein, our estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed under the heading Risk Factors in this prospectus. In addition, forward-looking information obtained from these sources is subject to the same qualifications and the additional uncertainties regarding the other forward-looking statements in this prospectus. Trademarks used in this prospectus are the property of their respective owners, although for presentational convenience we may not use the or the symbols to identify such trademarks. Implications of Being an Emerging Growth Company As a company with less than $1.07 billion in revenue during our last fiscal year, we qualify as an emerging growth company under the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of reduced reporting requirements and is relieved of certain other significant requirements that are otherwise generally applicable to public companies. As an emerging growth company: we may present as few as two years of audited financial statements and two years of related management discussion and analysis of financial condition and results of operations; we are exempt from the requirement to obtain an attestation and report from our auditors on management s assessment of our internal control over financial reporting under the Sarbanes-Oxley Act of 2002; we are permitted to provide reduced disclosure regarding our executive compensation arrangements pursuant to the rules applicable to smaller reporting companies, which means we do not have to include a compensation discussion and analysis and certain other disclosures regarding our executive compensation; and we are not required to hold non-binding advisory votes on executive compensation or golden parachute arrangements. In addition to the relief described above, the JOBS Act permits us an extended transition period for complying with new or revised accounting standards affecting public companies. We have irrevocably determined to take advantage of this extended transition period, which means that the financial statements included in this prospectus, as well as financial statements that we file in the future, may not be comparable to the financial statements of public companies that comply with such new or revised accounting standards on a non-delayed basis. Table of Contents Following the acquisition and private placement, the Company adopted a strategic plan focused on providing differentiated consumer and commercial banking services to clients in the Central and Southeastern Pennsylvania markets. As a result, the Bank has grown its balance sheet significantly both through organic loan and deposit growth, as well as the opportunistic strategic merger with GNBF as described in this prospectus. The Company s management team has leveraged their strong local community ties, extensive merger and acquisition experience and experience with the bank regulatory agencies to create an entrepreneurial and rapidly-growing bank supported by an advanced risk management infrastructure and strong credit quality. A summary of our growth in assets, deposits and loans is set forth below: Table of Contents In this prospectus we have elected to take advantage of the reduced disclosure requirements relating to executive compensation, and in the future we may take advantage of any or all of these exemptions for so long as we remain an emerging growth company. We will remain an emerging growth company until the earliest of (i) the end of the fiscal year during which we have total annual gross revenues of $1.07 billion or more, (ii) the end of the fiscal year following the fifth anniversary of the completion of this offering, (iii) the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt and (iv) the date on which we are deemed to be a large accelerated filer under the Securities Exchange Act of 1934, as amended. Table of Contents Our Key Accomplishments The summary below highlights our recent business accomplishments and key milestones, commencing with the 2018 acquisition of Stonebridge Bank. The history below that occurred prior to the Merger is the history of Legacy LINKBANCORP and not GNBF: October 2018: Closed acquisition of Stonebridge Bank. December 2018: At December 31, 2018, total assets were $83.7 million and the Company had 35 full-time employees. January 2019: Completed $45.5 million common stock private placement to support the Company s business plan and organic growth. May June 2019: Opened Client Solutions Centers in Camp Hill and Lancaster. April July 2020: Originated over 533 Paycheck Protection Program ( PPP ) loans for $86.1 million (through March 31, 2021 LINKBANK originated a total of 909 PPP loans for $139.9 million). June 2020: Achieved the Company s first profitable quarter, with $439,000 in net income for the three months ended June 30, 2020 and an annualized return on average assets ( ROAA ) of 0.54%. September October 2020: Raised $5.0 million in a private placement common stock issuance and issued $20.0 million in subordinated debt to support organic growth efforts. December 2020: Crossed over $400 million in total assets and the Company had 54 full-time employees. December 2020: Announced our strategic merger with GNB Financial Services, Inc. September 2021: Completion of merger with GNBF, as a result of which LINKBANCORP becomes the parent company of The Gratz Bank, also operating as LINKBANK, a division of The Gratz Bank within the legacy LINKBANK Capital, Lancaster and Delaware Valley Regions. Executive management roles continue to be filled by the Legacy LINKBANCORP officers, including Andrew Samuel - CEO; Carl Lundblad - President; Brent Smith, President of The Gratz Bank; Kristofer Paul - CFO; and Tiffanie Horton - Chief Credit Officer. Achieves critical mass in the Central Pennsylvania market. Doubles the Company s asset size and provides opportunity to capture economies of scale on both the revenue and cost sides. Diversifies the loan portfolio and provides low cost, stable and highly granular retail deposits. GNBF s relatively low loan-to-deposit ratio prior to the Merger provides additional liquidity to fuel LINKBANCORP s strong loan generation capabilities. Significantly enhances the loan-to-one borrower limit with a doubling of regulatory capital. December 2021: Total assets at December 31, 2021 were $932.8 million and the Company achieved $788,000 in quarterly net income, which included Merger-related expenses of $616,000. January 2022: The Company announced the hiring of a Regional President for the York/Lancaster Region and expansion of its Capital (Harrisburg) Region team. February 2022: The Company announced the hiring of a Regional President for the Delaware Valley markets in southeastern Pennsylvania and the expansion of its York Region team. Table of Contents April 2022: The Company completed a $20.0 million subordinated debt capital raise. April 2022: Opened loan production office (LPO) in downtown York to support that team s success and additional growth opportunities. May 2022: The Company announced the expansion of its Delaware Valley Region team by the addition of two senior commercial relationship managers. June 2022: Total assets at June 30, 2022 were $1.1 billion and the Company recognized quarterly net income of $1.6 million. Our Mission & Business Strategy Our mission is to positively impact lives by building the premier community bank franchise serving consumers and businesses in the Central and Southeastern Pennsylvania markets and the surrounding areas. We have a seasoned management team and have been able to attract experienced and long-tenured bankers with proven track records. Although our executive management team has had success throughout the community bank industry since the early 2000 s, in building our business plan and go-to market strategy for LINKBANCORP, we knew that the traditional community bank model would need to be adjusted and enhanced to compete and win in the current environment. This shift in strategy had several tenants: Hire talented, entrepreneurial bankers with demonstrated track records. Focus on profitable customer relationships and taking wallet share. Operate with a branch-lite footprint. Leverage technology, digital banking and information systems. Achieve economies of scale and increase operating leverage as we grow. The key ingredient to implementing this strategy is attracting and retaining top talent, which is driven by our culture and values that reflect authenticity and enthusiasm in all interactions. Blending a strong heritage of banking expertise with strong values, we are committed to providing compelling products, services, and financial consulting. Branch-Lite Organic Growth Engine Prior to completing our strategic merger with GNBF in 2021, we grew to over $450 million in total assets with only four branch offices. Our offices look and operate differently than branches of most of our competitors in the marketplace. Recognizing that client interactions continue to trend more toward digital transactions, our offices are designed to function as client solutions centers, many with no traditional teller line and staffed with just 3-4 full-time employees who are cross-trained to address a variety of client needs. Our go-to market approach is focused on hiring experienced and talented bankers that operate as a team in a particular region, under the leadership of a regional president who has significant decision-making authority for both consumer and commercial banking, thereby providing clients with a level of access and responsiveness not available from most of our competitors. Client solutions centers are strategically placed in each regional market and serve as a home base for each team. We have experienced great success utilizing this relationship-focus combined with regional leadership and decision-making in communities with strong local identities and a significant population of family-owned operating/manufacturing businesses. Table of Contents The de novo build out of our regional business development teams in the Capital, Lancaster/York and Delaware Valley Regions was supplemented with the strategic merger with GNBF, which forms the Gratz Region. Given the more rural demographics and long-tenured Gratz Bank customers, our strategy has been to continue operating those branches as they previously were with a focus on core deposit gathering in that region to fuel organic loan growth in our other regions. Our community banking strategy is focused on high touch relationship management and exceptional service supported by technology, primarily directed toward three different areas: Personal Banking: Strategically placed client solutions centers leveraging our strong local community identity and complemented with digital banking solutions. Business Banking: Focused on family-owned businesses with under $100 million in annual revenue. Table of Contents Nonprofit Banking: Bank of choice for nonprofits, with strong individual and organizational engagement in the communities we serve. We seek to maintain an average of more than $100 million in deposits per office to support our branch-lite footprint and achieve desired efficiencies. Below is a summary of our deposit growth for our client solutions centers located in the Capital and Lancaster/York Regions. Both of these solutions centers have been open since 2019 and we believe best demonstrate our community bank strategy as described above. We also recently hired a business development team to focus on our relocated solutions center in the Delaware Valley Region, where we will continue to execute this strategy. Through the GNBF Merger we inherited six branch offices, all of which remain open. The strategy for these legacy GNBF offices are different than our legacy LINKBANK client solutions centers, although we believe they provide a strong core funding base for our organic loan growth. As of June 30, 2022, our overall average branch size for offices open more than one year, was $94.6 million. While industry wide data for 2022 is not publicly available, we believe our average branch size of $85 million as of June 30, 2021 compares favorably to the $74 million average branch size in our markets of operation at June 30, 2021. Nimble and Innovative Tech Forward Operating Platform From its inception, the Company had a vision for entrepreneurial growth and innovation in technology. We knew that the traditional community bank operating model and philosophy would need to change and focus on technology that would support our branch-lite model as well as a more efficient operating and risk management Table of Contents infrastructure. To accomplish this, we have sought to develop a platform that will achieve objectives of native mobility, modular architecture, open API and cloud-based infrastructure. Early investments in virtualization and cloud capabilities have successfully enabled partnering for technology services that facilitate a more efficient and integrated workflow while enhancing responsiveness and the overall client experience. We also recognize that innovation is not possible without skilled technologists who understand the business of banking. In early 2022, we made a significant investment to recruit highly experienced professionals from community and regional financial services companies specifically skilled in the areas of data, digital banking, automation and process maturity. These business solutions architects, representing decades of combined banking operations and technology experience, are embedded and positioned in direct partnership with our business lines to accelerate service delivery and strategic advancements, shifting away from the typical community bank technology model of incremental improvements constrained by operational expense, toward a more nimble model where opportunities are identified and then promptly implemented for near-term impact. Growth Strategy Focused in Sizeable Markets with Above Average Growth Our organic growth strategy is focused in the Capital, Lancaster and Delaware Valley Regions. Population growth in each of these counties well exceeds the Pennsylvania average: These three regions collectively have $122 billion in deposit balances (per June 30, 2021 FDIC data), which is more than 20% of the entire Commonwealth of Pennsylvania with $553 billion in deposit balances. This addressable market of $122 billion in deposit balances is 1.7x times larger than the Philadelphia County market which is the closest major metropolitan area. These markets are amongst the largest in Pennsylvania, have strong demographics and the competitive landscape is such that they are heavily banked by the large money center and regional banks. Table of Contents Capitalizing on Market Disruption Our market area has undergone significant consolidation, particularly in the last twelve months. We intend to take advantage of the recent disruption caused by mergers and acquisitions in our operating markets, which we believe has created an environment of underbanked customers and has created opportunities to hire seasoned bankers. We have successfully employed this strategy in the past, hiring experienced bankers from merged institutions, which has helped us enhance critical aspects of our operations. We believe the most recent wave of consolidations, together with what we anticipate will be further consolidation, will create additional opportunities for us to attract additional experienced bankers. Below are some of the merger transactions announced and/or closed in and around our geographic footprint since 2017: First Commonwealth Corporation / Centric Financial Corporation Fulton Financial Corporation / Prudential Bancorp, Inc. Mid Penn Bancorp, Inc. / Riverview Financial Corporation WSFS Financial Corporation / Bryn Mawr Bank Corporation Citizens & Northern Corporation / Covenant Financial Inc. S&T Bancorp, Inc. / DNB Financial Corporation Citizens & Northern Corporation / Monument Bancorp, Inc. WSFS Financial Corporation / Beneficial Bancorp, Inc. Northwest Bancshares, Inc. / Donegal Financial Services Corp. Consistent with this strategy, we recently added teams of experienced bankers to supplement our efforts in both the York/Lancaster Region and the Delaware Valley Region. In each case, these lift outs involved well-respected lending teams that are familiar with these markets from regional financial institutions impacted by consolidation and other disruptions. In a short period of time, the investment in these teams has resulted in significant opportunities for new client relationships and increasing market share. Table of Contents Opportunistic Mergers and Acquisitions Strategy Our mergers and acquisitions strategy has been and will continue to be highly opportunistic. We will pursue strategic merger and acquisition opportunities, including whole bank and branch acquisitions, and non-bank acquisitions, that build long-term shareholder value. Our executive team has extensive experience in merger and acquisition integration with 10+ completed transactions since the early 2000s. The focus of our mergers and acquisitions strategy is to identify community banks open to a potential combination that are within a two-hour drive time radius or approximately 50-100 miles from our headquarters in Camp Hill, Pennsylvania. While the geographic radius of approximately 50-100 miles encapsulates many market areas, our focus is on acquiring banks operating outside of the major metropolitan markets. Throughout our history we have focused on the more suburban market areas that benefit from densely populated metropolitan markets. The most recent example of this is our business development opportunity in the Delaware Valley Region, which benefits from the growth and disruption in the Philadelphia metropolitan market. We also believe that the Maryland and northern Virginia marketplace offers potential growth opportunities. These markets have strong demographics and look and feel much like our existing markets. Our executive team actively develops relationships with community banks within these areas in order to explore such opportunities when the time is appropriate. Table of Contents We have disciplined acquisition criteria that any potential merger and acquisition transaction must meet: There may be highly strategic and compelling situations that arise which may not meet all five of the criteria listed above; these situations are likely very unique and rare and will be fully vetted by the LINKBANCORP Board and Management team before pursuing such a transaction. We would only pursue a nonconforming transaction if we believed the risk-adjusted return and shareholder value creation potential was well in-excess of other strategic initiatives. Our Competitive Strengths We believe the following strengths differentiate us from our competitors and position us to execute our business strategy successfully: Seasoned Executive Team with Value Creation Track Record Our seasoned executive management team, which is led by our Chief Executive Officer, Andrew Samuel, has significant experience and success with building, operating, and creating shareholder value at numerous banking institutions. This management team has long tenure together in our markets, providing a familiarity with each other and with the marketplace that is unique among our competitors. Executives are highly engaged in business development and community engagement initiatives and are able to attract and recruit top talent due to a reputation for developing high performing and successful teams. Table of Contents (1) On September 8, 2022, Adam Pierce, LINKBANCORP s Chief Operations and Technology Officer, advised the Company that he intends to resign his position with the Company effective September 23, 2022. Mr. Pierce s resignation is for personal reasons and is not the result of any disagreement or dispute with the Company on any matter related to its operations, policies or practices. The Company will appoint Jeffrey Renninger as Interim Chief Operations and Technology Officer effective September 23, 2022. Mr. Renninger previously served as the Company s Chief Operating Officer from 2018 to 2020, and has over 30 years of bank operations experience, primarily working with this management team. Differentiated Brand and Culture We believe our corporate culture is a differentiating factor in our demonstrated growth and ability to gain market share. Central to our culture and brand are our core L-I-N-K values which support our mission of positively impacting lives. Table of Contents In our brief history, we have intentionally nurtured this culture to support development of a well-defined internal and external brand reflecting a purpose-driven, entrepreneurial and relational organization that is highly responsive to client needs and our communities and attracts best-in-class bank professionals. This culture starts with our mission to positively impact lives through community banking. In pursuing this mission, we invest in the development of strong future leaders for the banking industry and our communities, contribute to economically and socially flourishing communities, and seek to demonstrate the continued viability and integral role of community banking for our economic and social development. As one example of these efforts, we launched and continue to support The LINK Foundation, established as a separate legal entity and governed by a distinct board of trustees, but fully aligned with our mission. The LINK Foundation provides financial support to organizations within our markets focused on three funding priorities developing future leaders, promoting financial literacy and fortifying personal growth. Our culture and brand are significantly dependent on highly engaged employees, so we are intentionally committed to investing in the development of our employees. Under the leadership of our Chief Culture Officer, we offer our employees hands-on leadership training, performance management and professional development training, monthly sessions focused on our core values, fun celebration and team-building events and time dedicated to participating in community volunteer opportunities. In recognition of these initiatives, we have been recognized regionally and nationally within the banking industry as a best place to work. We believe our culture of highly engaged employees committed to a common purpose enhances productivity and results in lower employee turnover, leading to greater operational efficiencies, a consistent brand experience and customer loyalty. Significant Experience in Acquiring and Integrating Banks Our executive team has a long-term track record and significant experience with acquiring and integrating community bank acquisitions as well as executing on sales and strategic mergers. Our executive team, including experience at prior institutions, has successfully closed on and integrated six whole bank transactions (acquisitions or strategic mergers) and numerous branch acquisitions. In September 2021, we closed the GNBF strategic merger and have successfully grown the GNBF deposit franchise. As anticipated, the GNBF strategic merger has provided an attractive core funding base that has helped fund our commercial loan growth in the Capital, Lancaster/York, and Delaware Valley markets. We successfully completed the systems integration with GNBF in October 2021 which was only one month after closing. While we are confident in our organic growth prospects, we intend to pursue prudent and commercially attractive acquisitions that will position us to further capitalize on market opportunities and help us continue to improve our platform s operating leverage. Table of Contents Disciplined Underwriting and Robust Enterprise Risk Management Our holistic approach to risk management has been an asset that supports our growth strategies. Our enterprise risk management program follows a three lines of defense structure and is designed to permeate across all functional areas. From our inception, we placed a very high priority on establishing an effective risk management culture, including appointing a Board-level Enterprise Risk Management Committee which reviews information each quarter regarding exposure to strategic risk, reputation risk, credit risk, market risk, liquidity risk, legal and regulatory compliance risk, operations and technology (including cybersecurity) risk, as well as the Company s strategies to monitor, control and mitigate these risks. The Company s Chief Risk Officer and officer-level Management Enterprise Risk Committee meets quarterly to review and discuss existing and emerging risks, including key risk indicators (KRIs) that are tracked and monitored regularly, and serve as a primary avenue for escalation and reporting to the Board s Enterprise Risk Management Committee. Table of Contents We understand that credit is one of the most critical risks for any financial institution. As a result of our disciplined underwriting standards and procedures, we have achieved significant balance sheet growth while maintaining superior credit quality. Our nonperforming assets to total assets ratio was 0.14% as of June 30, 2022 and our allowance represented 260.4% of our nonperforming loans as of June 30, 2022. Our credit culture is guided by the following principles: Focus on relationship lending, in many cases with clients that our relationship managers and executive management team have known for decades; Development of underwriting and credit risk management processes tailored to each of our products and regions; Centralized credit oversight and segregated reporting of credit and lending teams; Utilization of regional credit officers with specific lending authority, allowing for localized analysis and decision making and faster turnaround time; Commitment to maintaining a diverse portfolio; Sophisticated monitoring and analysis of our portfolio and establishment of sub-portfolio limits that we review regularly and adjust in response to changes in our lending strategy and market conditions; and Proactive problem asset management. Although we maintain a cautious credit outlook due to continued uncertainty in the current economic environment, we believe we are well positioned for the months ahead given a strong loan reserve, application of prudent underwriting standards and a diverse loan portfolio with no significant concentrations. We also expect a rising interest rate environment to be a positive given that our portfolio is more heavily weighted toward variable and adjustable-rate loans. Recent Developments On August 18, 2022, we declared a quarterly dividend of $0.075 per share of common stock for the second quarter of 2022. This dividend is payable to shareholders of record at the close of business on August 31, 2022, payable on September 15, 2022. Investors in this offering are not entitled to receive this dividend. Risks Relating to Our Company and an Investment in Our Common Stock An investment in our common stock involves substantial risks and uncertainties. Investors should carefully consider all of the information in this prospectus, including the detailed discussion of these and other risks under Risk Factors beginning on page 33, prior to investing in our common stock. Some of the significant risks include the following: Changes in economic conditions, in particular an economic slowdown in Pennsylvania, could materially and negatively affect our business. A significant portion of our loan portfolio is secured by real estate, and events that negatively impact the real estate market could hurt our business. Inflation can have an adverse impact on our business and on our customers. The economic impact of the COVID-19 outbreak could continue to affect our financial condition and results of operations. Changes in prevailing interest rates may reduce our profitability, and we may not be able to adequately anticipate and respond to changes in market interest rates. Table of Contents Our commercial real estate loans may increase our exposure to credit risk. Repayment of commercial business loans is often dependent on the cash flows of the borrower, which may be unpredictable, and the collateral securing these loans may fluctuate in value. Our decisions regarding allowance for loan losses and credit risk may materially and adversely affect our business. If the allowance for loan losses is not sufficient to cover actual loan losses, our earnings could decrease. If our non-performing assets increase, our earnings will be adversely affected. A portion of our loan portfolio consists of loan participations. Loan participations may have a higher risk of loss than loans we originate because we are not the lead lender, and we have limited control over credit monitoring. The implementation of the current expected credit loss accounting standard could require us to increase our allowance for loan losses and may have a material adverse effect on our financial condition and results of operations. We may be unable to effectively manage our growth. We may encounter significant difficulties in integrating with GNBF and may fail to realize the anticipated benefits of the Merger, or those benefits may take longer to realize than expected. Future acquisitions could disrupt our business and adversely affect our results of operations, financial condition and cash flows. We rely heavily on technology, and our information systems may experience an interruption or breach in security. We rely on third party vendors, which could expose us to additional cybersecurity risks. Liquidity needs could adversely affect our financial condition and results of operation. We rely heavily on our senior management team and the unexpected loss of any of those personnel could adversely affect our operations. Competition with other financial institutions may have an adverse effect on our ability to retain and grow our client base, which could have a negative effect on our financial condition or results of operations. We are subject to extensive government regulation and supervision that could interfere with our ability to conduct our business and may negatively impact our financial results, restrict our activities, have an adverse impact on our operations, and impose financial requirements or limitations on the conduct of our business. The Bank is subject to federal and state fair lending laws, and failure to comply with these laws could lead to material penalties. The Bank faces a risk of noncompliance and enforcement action with the Bank Secrecy Act and other anti-money laundering statutes and regulations. Regulations relating to privacy, information security and data protection could increase our costs, affect or limit how they collect and use personal information and adversely affect their business opportunities. The trading history of our common stock is characterized by low trading volume. An active, liquid trading market for our common stock may not develop, and you may not be able to sell your common stock at or above the public offering price, or at all. Table of Contents You will incur immediate dilution as a result of this offering. The price of our common stock could be volatile following this offering. Our management will have broad discretion as to the use of proceeds from this offering, and we may not use the proceeds effectively. Our directors and executive officers beneficially own a significant portion of our common stock and have substantial influence over us. Our Articles of Incorporation and Bylaws, and certain banking laws applicable to us, could have an anti-takeover effect that decreases our chances of being acquired, even if our acquisition is in our shareholders best interests. Corporate Information Our principal executive offices are located at 3045 Market Street, Camp Hill, Pennsylvania 17011 and our telephone number at that address is (855) 569-2265. Our website address is ir.linkbancorp.com. The information contained on our website is not a part of, or incorporated by reference into, this prospectus. Table of Contents The Offering Common stock offered by us 4,575,000 shares Underwriters purchase option 686,250 shares from us Common stock outstanding after completion of this offering 14,413,435 shares (or 15,099,685 shares if the underwriters exercise their option to purchase additional shares in full). Use of proceeds We estimate that the net proceeds to us from this offering, after deducting underwriting discounts and estimated offering expenses, will be approximately $36.2 million (or approximately $41.8 million if the underwriters exercise their option to purchase additional shares in full), based on an assumed public offering price of $8.75 per share, which is the midpoint of the price range set forth on the cover of this prospectus. We intend to use the net proceeds of the offering to support the growth of The Gratz Bank, including providing capital to The Gratz Bank to support growth of its operations, including, without limitation, expansion of its lending activities, financing strategic acquisitions that may from time to time arise and for other general corporate purposes. See Use of Proceeds. Dividend policy Through the second quarter of 2022, we paid total dividends of $0.15 per share, or an annualized yield of 3.43%, based on an assumed market price of $8.75 per share. The Merger Agreement with GNBF provides that, for three years following the effective time of the Merger, the Company will pay a quarterly cash dividend in an amount equal to or greater than $0.30 per share per year, provided sufficient funds are legally available and that the Company and the Bank remain well-capitalized in accordance with applicable regulatory guidelines. Subject to the approval of our board of directors and regulatory restrictions, the Company anticipates that it will continue to pay cash dividends on a quarterly basis in an amount equal to or greater than $0.30 per share per year. Our board of directors will make any determination whether or not to pay dividends based upon our financial condition, results of operations, capital and regulatory restrictions and other relevant factors. See Dividend Policy. Listing and trading symbol We have applied to list our common stock on the Nasdaq Capital Market under the symbol LNKB. Directed Share Program At our request, the underwriters have reserved up to 5% of the shares of our common stock offered by this prospectus for sale, at the initial public offering price, to our directors, officers, principal shareholders, employees, business associates, and related persons who have expressed an interest in purchasing our common stock in this offering. We will offer these shares to the extent permitted under applicable regulations in the United States through a directed share program. See the section entitled Underwriting Directed Share Program. Table of Contents
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere or incorporated by reference in this prospectus and does not contain all of the information you should consider in making your investment decision. You should read this summary together with the more detailed information included elsewhere or incorporated by reference in this prospectus, including financial statements and the related notes. You should carefully consider, among other things, the matters discussed under Risks Factors in the 2021 Form 10-K, the Form 10-Qs and in other documents that we subsequently file with the Commission that are incorporated by reference herein. The Company innovates technologies that contribute to global decarbonization and circularity by efficiently converting supplies of unused and under-utilized natural resources into renewable fuels and electrification products. The Company intends to achieve growth and financial, natural, and social gains by building, owning and operating a fleet of advanced carbon neutral extraction and refining facilities, by selling an array of complimentary process solutions and related services, and by licensing selected technologies to qualified strategic partners. Our strategic plan is based on innovating and using our technologies and the renewable energy products that they enable to reduce reliance on long cycle fossil fuels, to shift to and maximize throughput of short cycle fuels, and to lead and support the adoption and growth of a highly profitable, balanced worldwide short cycle ecosystem that continuously offsets, recycles, and contributes to neutralizing global carbon emissions by rapidly growing and replenishing vast quantities of feedstock for renewable circular fuels. We also make strategic investments that contribute to our mission of enabling systemic decarbonization and support our vision of a net zero carbon world. Comstock historically focused on natural resource exploration, development, and production, with an emphasis on mining gold and silver resources from its extensive contiguous property holdings in the historic Comstock and Silver City mining districts in Nevada. During 2021 and 2022, we completed a series of transactions that were designed to build on our competencies and position us to address and capitalize on the global transition to clean energy. Those transactions primarily included (i) our strategic acquisitions of 100% of Comstock Innovations Corporation (F/K/A Plain Sight Innovations Corporation), 100% of Comstock Engineering Corporation (F/K/A Renewable Process Solutions, Inc.), 100% of MANA Corporation, and 90% of LINICO Corporation, (ii) our acquisition of intellectual property assets from FLUX Photon Corporation, (iii) our purchase of 48.19% of Quantum Generative Materials LLC and (i) our optioning for sale of Comstock Mining LLC, the owner of our Lucerne resource area in Storey County, Nevada, and related permits. Collectively, these transactions added the management, employees, facilities, intellectual properties, and other assets we needed to restructure and transform our Company and business into an emerging leader in the innovation and sustainable production of renewable energy products, including cellulosic fuels and electrification metals. In light of the Company s recent transformation, the Company changed its name to Comstock Inc. on May 26, 2022. Corporate Information The Company s executive offices are located at 117 American Flat Road, Virginia City, Nevada 89440 and its telephone number is (775) 847-5272. The Company s mailing address is P.O. Box 1118, Virginia City, Nevada 89440. The Company s website address is www.comstock.inc. The Company s website and the information contained on, or that can be accessed through, the website are not part of this prospectus.
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+PROSPECTUS SUMMARY 1
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+Prospectus Summary Implications of Being an Emerging Growth Company. Investing in our securities involves a high degree of risk. See the section entitled Risk Factors beginning on page 6 of this prospectus to read about factors you should consider before buying our securities. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued under this prospectus or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. Table of Contents Table Of Contents Page ABOUT THIS PROSPECTUS ii FORWARD-LOOKING STATEMENTS iii SUMMARY OF THE PROSPECTUS 1
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index 0000000000000000000000000000000000000000..fc46f56fb7b81f23b26206e570912500d9cb5ea5
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/MDNC_medinotec_prospectus_summary.txt
@@ -0,0 +1 @@
+S-1/A 1 medinotec_s1a.htm UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-1/A Amendment No. 5 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 MEDINOTEC INC. (Exact name of registrant as specified in its charter) Nevada 3841 36-4990343 (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification No.) Northlands Deco Park | 10 New Market Street | Stand 299 Avant Garde Avenue | North Riding | 2169 +27 87 330 2301 Spring Valley Solutions, LLC 4955 S. Durango Rd. Ste. 165 Las Vegas, NV 89103 (702) 982-5686 (Address, including zip code, and telephone number, including area code, of principal executive offices) (Name, address, including zip code, and telephone number, including area code, of agent for service) Approximate date of commencement of proposed sale to the public: From time to time after this registration statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging Growth Company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THE REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933, OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(A), MAY DETERMINE. With copies to: Scott Doney, Esq. The Doney Law Firm 4955 S. Durango Rd. Ste. 165 Las Vegas, NV 89103 Telephone: (702) 982-5686 The information in this prospectus is not complete and may be changed. This prospectus is included in a registration statement that we filed with the Securities and Exchange Commission. The Selling Shareholders cannot sell these securities under this registration statement until this registration statement becomes effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to Completion, dated November 18, 2022 PROSPECTUS MEDINOTEC INC. 1,733,750 Shares of Common Stock This prospectus relates to the resale by the Selling Shareholders of up to 1,733,750 shares of our Common Stock, par value $0.001 per share (the "Common Stock"). We will not receive any proceeds from this offering and have not made any arrangements for the sale of these securities. We will use our best efforts to maintain the effectiveness of the resale registration statement through and until all securities registered under the registration statement have been sold or are otherwise able to be sold pursuant to Rule 144 promulgated under the Securities Act of 1933, as amended. Our Common Stock is not presently traded on any market or securities exchange. The sales price to the public is fixed at $5.00 per share until such time as the shares of our Common Stock are traded on the OTCQB or OTCQX. This quotation service is a network of securities dealers who buy and sell stock. The dealers are connected by a computer network that provides information on current "bids" and "asks," as well as volume information. Although we intend to apply for quotation of our Common Stock on the OTCQB or OTCQX through a market maker, public trading of our common stock may never materialize. If our Common Stock becomes traded on the OTCQB or OTCQX, then the sale price to the public will vary according to prevailing market prices or privately negotiated prices by the Selling Shareholders. We have agreed to pay certain expenses in connection with this registration statement and to indemnify the Selling Shareholders against certain liabilities. The Selling Shareholders will pay all underwriting discounts and selling commissions, if any, in connection with the sale of the shares of Common Stock. Dr. Gregory Vizirgianakis, our Founder, President, Chief Executive Officer and a member of our board of directors, and his brother, Stavros Vizirgianakis, also a member of our board of directors, together control our company with an 81% vote on all matters regarding shareholder approval by virtue of his ownership in our common stock. They are able to exercise significant influence over our company, including the election of directors, the approval of significant corporate transactions, and any change of control of our company. We are an "emerging growth company" under the federal securities laws and will be subject to reduced public company reporting requirements. Investing in our common stock involves risks. See "Risk Factors" beginning on page 15. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus November 18, 2022 i ABOUT THIS PROSPECTUS This prospectus is part of a registration statement we filed with the Securities and Exchange Commission, or the SEC. Under this registration process, the selling shareholders may, from time to time, offer and sell up to 1,733,750 shares of our common stock, as described in this prospectus, in one or more offerings. This prospectus provides you with a general description of the securities the selling shareholders may offer. You should read this prospectus carefully before making an investment decision. You may only rely on the information contained in this prospectus or that we have referred you to. We have not authorized anyone to provide you with additional or different information. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities other than the shares of our common stock offered by this prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any common stock in any circumstances or any jurisdiction in which such offer or solicitation is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front cover of this prospectus regardless of the time of delivery of this prospectus or any sale of our common stock. The rules of the SEC may require us to update this prospectus in the future. ABOUT FORWARD-LOOKING STATEMENTS This prospectus and the documents incorporated by reference herein include statements that express our opinions, expectations, beliefs, plans, objectives, assumptions or projections regarding future events or future results and therefore are, or may be deemed to be, "forward-looking statements." These forward-looking statements can generally be identified by the use of forward-looking terminology, including the terms "believes," "expects," "may," "will," "should," "seeks," "projects," "approximately," "intends," "plans," "estimates" or "anticipates," or, in each case, their negatives or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts. Forward-looking statements include discussions of strategy, financial projections, guidance and estimates (including their underlying assumptions), statements regarding plans, objectives, expectations or consequences of various transactions, and statements about the future performance, operations, products and services of the Company and its subsidiaries. We caution our shareholders and other readers not to place undue reliance on such statements. Our businesses and operations are and will be subject to a variety of risks, uncertainties and other factors. Consequently, actual results and experience may materially differ from those contained in any forward-looking statements. Such risks, uncertainties and other factors that could cause actual results and experience
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/MDWD_mediwound_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/MDWD_mediwound_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..014b5d44cdb5c41a828e4f9028785b8ee7da8882
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/MDWD_mediwound_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary provides an overview of selected information contained elsewhere or incorporated by reference in this prospectus and does not contain all of the information you should consider before investing in our securities. You should carefully read the prospectus, the information incorporated by reference and the registration statement of which this prospectus is a part in their entirety before investing in our securities, including the information discussed under Risk Factors in this prospectus and the documents incorporated by reference and our financial statements and related notes that are incorporated by reference in this prospectus. In this prospectus, unless the context indicates otherwise, MediWound, the Company, the registrant, we, us, our, or ours refer to MediWound Ltd. and its subsidiaries. Overview We are a biopharmaceutical company that develops, manufactures, and commercializes novel, cost effective, bio therapeutic, non-surgical solutions for tissue repair and regeneration. Our strategy leverages our breakthrough enzymatic technology platform into diversified portfolio of biotherapeutics across multiple indications to pioneer solutions for unmet medical needs. Our current portfolio is focused on next-generation protein-based therapies for burn care, wound care and tissue repair. Our first innovative biopharmaceutical product, NexoBrid , has received marketing authorization from the European Medicines Agency (the EMA ) and other international markets for removal of dead or damaged tissue, known as eschar, in adults with deep partial-thickness and full-thickness thermal burns, also referred to as severe burns. NexoBrid, a concentrate of proteolytic enzymes enriched in bromelain, represents a new paradigm in burn care management, and our clinical trials have demonstrated, with statistical significance, its ability to non surgically and rapidly remove the eschar, without harming viable tissues, earlier relative to existing standard of care. In September 2020, the U.S. Food and Drug Administration (the FDA ) accepted for review our Biologics License Application ( BLA ) for NexoBrid for severe burns. On June 29, 2021, we received a Complete Response Letter ( CRL ) from the FDA to our Biologics License Application ( BLA ) for NexoBrid for severe burns, pursuant to which the FDA communicated that it had completed its review of the BLA, as amended, and determined that the application cannot be approved in its present form. The FDA identified issues related to the Chemistry, Manufacturing and Controls ( CMC ) section of the BLA, and requested additional CMC information. The FDA acknowledged receipt of several CMC amendments, submitted in response the CMC information requests, which were not reviewed for this action. In addition, the CRL cited certain observations identified during good clinical practice ( GCP ) inspections related to the DETECT study, and requested that we provide our perspective on the potential impact, if any, of these observations on the efficacy findings in the study. The FDA also requested to provide a safety update as part of any BLA resubmission, although there were no safety issues raised in the CRL. On August 3, 2022, we announced that the FDA has accepted for review our re-submitted BLA for NexoBrid for eschar removal (debridement) in adults with deep partial-thickness and/or full-thickness thermal burns, and assigned a Prescription Drug User Fee Act ( PDUFA ) target date of January 1, 2023. We commercialize NexoBrid globally through multiple sales channels. We sell NexoBrid to burn centers in the European Union, United Kingdom and Israel, primarily through our direct sales force, focusing on key burn centers and Key Opinion Leaders ( KOL ). In the United States, we entered into exclusive license and supply agreements with Vericel Corporation (Nasdaq: VCEL) to commercialize NexoBrid in North America upon FDA approval (if received). We have established local distribution channels in multiple international markets, focusing on Asia Pacific, EMEA, CEE and LATAM, which local distributors are also responsible for obtaining local marketing authorization within the relevant territories. The information in this prospectus is not complete and may be changed. The selling shareholders named in this prospectus may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and neither we nor the selling shareholders are soliciting an offer to buy these securities in any state or jurisdiction where the offer or sale is not permitted. Subject to Completion, dated November 10, 2022 PROSPECTUS MediWound Ltd. 28,153,058 Ordinary Shares This prospectus relates to the resale by the selling shareholders named in this prospectus from time to time of up to 28,153,058 of our ordinary shares, par value NIS 0.01 per share. These 28,153,058 ordinary shares consist of: 9,853,058 ordinary shares (the Pre-Funded Warrant Shares ) issued or issuable upon the exercise of pre-funded warrants (the Pre-Funded Warrants ) that were issued pursuant to the securities purchase agreement, dated as of September 22, 2022, by and among us and the purchasers named therein (the PIPE Securities Purchase Agreement ); 9,853,058 ordinary shares (the Series A Warrant Shares ) issued or issuable upon the exercise of series A warrants (the Series A Warrants ) that were issued pursuant to the PIPE Securities Purchase Agreement; 7,575,513 ordinary shares (the RD Warrant Shares ) issued or issuable upon the exercise of the registered direct series A warrants (the RD Warrants ) that were issued pursuant to the registered direct securities purchase agreement, dated as of September 22, 2022, by and among us and the purchasers named therein (the RD Securities Purchase Agreement ); and 871,429 ordinary shares (the Wainwright Warrant Shares, and together with the Pre-Funded Warrant Shares, the Series A Warrant Shares and the RD Warrant Shares, the Warrant Shares ) issued or issuable upon the exercise of the warrants issued to H.C. Wainwright & Co., LLC (or its designees) as compensation (the Wainwright Warrants, and together with the Pre-Funded Warrants, Series A Warrants and RD Warrants, the Warrants ) in connection with their role as exclusive placement agent in the Offerings (as defined below). The Warrants were issued in reliance upon the exemption from the registration requirements in Section 4(a)(2) of the Securities Act and Regulation D promulgated thereunder. Each purchaser represented that it was an accredited investor (as defined by Rule 501 under the Securities Act). We are registering the offer and resale of the Warrant Shares. For a description of the transaction pursuant to which this resale registration statement relates, please see Prospectus Summary Recent Developments RD and PIPE Financings. Our registration of the ordinary shares covered by this prospectus does not mean that the selling shareholders will offer or sell any of such ordinary shares. The selling shareholders named in this prospectus, or their donees, pledgees, transferees or other successors-in-interest, may resell the ordinary shares covered by this prospectus through public or private transactions at prevailing market prices, at prices related to prevailing market prices or at privately negotiated prices. For additional information on the possible methods of sale that may be used by the selling shareholders, you should refer to the section of this prospectus entitled Plan of Distribution. We will not receive any of the proceeds from the sale of ordinary shares by the selling shareholders. However, we will receive proceeds from the exercise of the Warrants, if such securities are exercised for cash. We intend to use those proceeds, if any, for general corporate purposes. Any ordinary shares subject to resale hereunder will have been issued by us and acquired by the selling shareholders prior to any resale of such shares pursuant to this prospectus. No underwriter or other person has been engaged to facilitate the sale of the ordinary shares in this offering. We will bear all costs, expenses and fees in connection with the registration of the ordinary shares. The selling shareholders will bear all commissions and discounts, if any, attributable to their respective sales of our ordinary shares. Our ordinary shares is traded on The Nasdaq Global Market under the symbol MDWD. On November 9, 2022, the reported sales price of our ordinary shares on The Nasdaq Global Market was $1.31 per share. Investment in our ordinary shares involves a high degree of risk. See Risk Factors beginning on page 8, in our periodic reports filed from time to time with the Securities and Exchange Commission, which are incorporated by reference in this prospectus and in any applicable prospectus supplement. You should carefully read this prospectus and the accompanying prospectus supplement, together with the documents we incorporate by reference, before you invest in our ordinary shares. Neither the Securities and Exchange Commission, the Israel Securities Authority, nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or the accuracy of this prospectus. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. We have been awarded two contracts with the U.S. Biomedical Advanced Research and Development Authority ("BARDA"), for the advancement of the development and manufacturing, as well as the procurement of NexoBrid which has initiated on January 2020, as a medical countermeasure as part of BARDA preparedness for mass casualty events. On September 20, 2022, we announced that that the EMA has validated for review the Type II Variation submitted by MediWound to expand the current approved indication for NexoBrid (removal of eschar in adults with deep partial-thickness and full-thickness thermal burn wounds) into the pediatric population. MediWound expects a decision from the European Commission in the first quarter of 2023. EscharEx , our next-generation enzymatic therapy under development, is a topical biological drug candidate for the debridement of chronic and other hard-to-heal wounds. Designed for the outpatient setting, EscharEx is an easy-to-use concentrate of proteolytic enzymes enriched in bromelain; having the same active pharmaceutical ingredient ( API ) as NexoBrid. In several Phase 2 trials, EscharEx was shown to be well-tolerated and demonstrated safety and efficacy in the debridement of various chronic and other hard-to-heal wounds with only few daily applications. EscharEx s mechanism of action is mediated by the proteolytic enzymes that cleave and remove the necrotic tissue and prepare the wound bed for healing. On May 12, 2022, we announced positive results from our U.S. Phase 2 clinical study of EscharEx for the debridement of venous leg ulcers ( VLUs ). The study met its primary endpoint with a high degree of statistical significance, demonstrating that patients treated with EscharEx had a statistically significant higher incidence of complete debridement during the 14-day measurement period within up to 8 applications, compared to gel vehicle (EscharEx: 63% (29/46) vs. gel vehicle: 30% (13/43), p-value=0.004). EscharEx efficacy superiority remained statistically significant after adjusting for pre-specified covariates ascribed to patient baseline characteristics, wound size, wound age and regions. The study met key secondary and exploratory endpoints. Patients treated with EscharEx had a statistically significant higher incidence of complete debridement, during the same 14-day measurement period, compared to patients treated by non-surgical standard-of-care ("NSSOC") (EscharEx: 63% (29/46) vs. NSSOC: 13% (4/30)) and the time to achieve complete debridement was significantly shorter. Estimated median time to complete debridement, was 9 days for patients treated with EscharEx and 59 days for patients treated with NSSOC (p-value=0.016). On average, complete debridement was achieved after 3.6 applications of EscharEx compared to 12.8 applications with NSSOC. Patients treated with EscharEx demonstrated significantly higher incidence of at least 75% granulation tissue at the end of the treatment period compared to gel vehicle (p-value <0.0001). Favorable trends were observed in wound area reduction and reduction of pain compared to gel vehicle. In addition, the study showed that EscharEx was safe and well tolerated, and the overall safety was comparable between the arms as assessed by the data safety monitoring board. Importantly, there were no observed deleterious effects on wound closure and no material differences in reported adverse events. Estimated time to complete wound closure was 64 days for patients treated with EscharEx compared to 78 days for patients treated with NSSOC. Type-C meetings with the FDA to discuss the pivotal study design are targeted for the fourth quarter of 2022. EscharEx was also evaluated in a U.S. Phase 2 pharmacology study. The study was prospective, open label, single-arm and conducted at three U.S. clinical sites. On July 7, 2022, we announced positive results from this study. 70% of patients achieved complete debridement during the course of treatment within up to 8 applications. On average, complete debridement was achieved after 3.9 applications of EscharEx. Additionally, an average reduction of 35% in wound size was achieved by the end of the 2-week follow-up period. In all patients that were positive for biofilm at baseline, the biofilm was reduced substantially to single individual microorganisms or completely removed by the end of treatment. Seven patients had positive red fluorescence (indicative of bacteria) at baseline and average red fluorescence was reduced from 1.69 cm2 pre-treatment to 0.60 cm2 post treatment. Biomarker analysis from wound fluid is on-going and safety data shows that EscharEx is safe and well-tolerated. Our third innovative product candidate, MW005, is a topically applied biological drug candidate for the treatment of non-melanoma skin cancers, based on the same API of NexoBrid and EscharEx (a concentrate of proteolytic enzymes enriched in bromelain). In July 2021, we initiated a phase I/II study of MW005 for the treatment of low-risk basal cell carcinoma ( BCC ). On July 11, 2022, we announced positive initial data from this study. In the first cohort, eleven patients with either superficial or nodular BCC were treated. Patients enrolled into the study received seven topical applications of MW005, once every other day. At the end of eight weeks post treatment period, all patients undergo complete excision, and the specimen is subject to an independent histological clearance examination. Based on the data generated to date, MW005 is safe, well-tolerated and an effective treatment for BCC with a majority of patients who completed the study demonstrating a complete histological clearance of target lesions. We anticipate announcing the final data by year end of 2022. We manufacture NexoBrid and our product candidates in our cGMP certified sterile manufacturing facility at our headquarters in Yavne, Israel. Recent Developments RD and PIPE Financings On September 22, 2022, we entered the RD Securities Purchase Agreement with the several purchasers listed on the signature pages thereto (the Purchasers ), in connection with the offer and sale of 7,575,513 of our ordinary shares, par value NIS 0.01 per share (the Ordinary Shares ) and, pursuant to the RD Securities Purchase Agreement, the Company also agreed to issue to the Purchasers 7,575,513 RD Warrants to purchase up to 7,575,513 Ordinary Shares (the RD Offering ). The combined purchase price of for one Ordinary Share and associated RD Warrant was $1.75. The sale of the Ordinary Shares was made pursuant to a shelf registration statement on Form F-3 (File No. 333-265203) previously filed with the Securities and Exchange Commission (the SEC ) on May 25, 2022 and declared effective on June 3, 2022, and the prospectus contained therein, as supplemented by the prospectus supplement dated September 22, 2022, filed with the SEC on September 23, 2022. The RD Warrants have an exercise price of $1.925 per Ordinary Share and will become exercisable upon our receipt of shareholder approval to increase the number of our authorized Ordinary Shares from 50,000,000 to 90,000,000 (the Authorized Share Increase Date ), pursuant to our Amended and Restated Articles of Association, and will expire four (4) years from the Authorized Share Increase Date. We have called an extraordinary general meeting of our shareholders to approve this increase in the number of our authorized Ordinary Shares for November 28, 2022. The RD Offering closed on September 26, 2022. The gross proceeds from the RD Offering were approximately $13.26 million. Concurrently with the signing of the RD Securities Purchase Agreement, we entered the PIPE Securities Purchase Agreement with the several purchasers listed on the signature pages thereto (the PIPE Purchasers ), in connection with the offer and sale of 9,853,058 Pre-Funded Warrants to purchase up to 9,853,058 Ordinary Shares and 9,853,058 Series A Warrants to purchase up to 9,853,058 Ordinary Shares (together, the PIPE Warrant Shares, and the Series A Warrants and Pre-Funded Warrants together, the PIPE Warrants ) (the PIPE Offering ). The combined purchase price for one Pre-Funded Warrant and associated Series A Warrant was $1.749. The Pre-Funded Warrants have an exercise price of $0.001 per Ordinary Share and the Series A Warrants have an exercise price of $1.925 per Ordinary Share and each will become exercisable upon the Authorized Share Increase Date, and will expire, in the case of the Series A Warrants, four (4) years from the Authorized Share Increase Date. The PIPE Offering closed on October 6, 2022. The gross proceeds from the PIPE Offering were approximately $17.24 million. H.C. Wainwright & Co., LLC ( Wainwright ) acted as the exclusive placement agent for the RD Offering and the PIPE Offering (together,
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/MGLD_marygold_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/MGLD_marygold_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..24f6f63f94ac5b44d971e83bdabe2401b8458256
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/MGLD_marygold_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary The following summary highlights material information found in more detail elsewhere in the prospectus. It does not contain all of the information you should consider. As such, before you decide to buy our common stock, in addition to the following summary, we urge you to
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/MRKR_marker_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/MRKR_marker_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/MRKR_marker_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/MSSRF_metal-sky_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/MSSRF_metal-sky_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..1073239331ffd770b7ef38269ae288be0c90280d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/MSSRF_metal-sky_prospectus_summary.txt
@@ -0,0 +1,8219 @@
+Summary
+Financial Data
+
+ 
+
+The
+following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included
+in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented.
+
+ 
+
+ 
+ December
+ 31, 2021 
+
+ 
+ Actual 
+ As
+ Adjusted 
+
+ Balance
+ Sheet Data: 
+ 
+ 
+
+ Working
+ capital (deficit)(1) 
+ $(236,372) 
+ $98,000,150 
+
+ Total
+ assets(2) 
+ 332,500 
+ 100,500,150 
+
+ Total
+ liabilities(3) 
+ 332,350 
+ 2,500,000 
+
+ Value
+ of ordinary shares subject to possible redemption/tender(4) 
+ — 
+ 100,000,000 
+
+ Shareholders 
+ equity/(deficit)(5) 
+ 150 
+ (1,999,850)
+
+ 
+
+ 
+
+ 
+ (1)
+ The "as adjusted"
+ calculation includes $100,000,000 cash held in trust from the proceeds of this offering and the sale of the private placement units,
+ plus $500,000 in cash held outside the trust account, plus $150 of actual shareholders equity on December 31, 2021, less $2,500,000
+ of deferred underwriting commissions.
+
+ 
+
+ 
+
+ 
+ (2)
+ The "as adjusted"
+ calculation equals $100,000,000 cash held in trust from the proceeds of this offering and the sale of the private placement units,
+ plus $500,000 in cash held outside the trust account, plus $150 of actual shareholders equity on December 31, 2021.
+
+ 
+
+ 
+
+(3)The
+ "as adjusted" calculation includes $2,500,000 of deferred underwriting commissions.
+
+ 
+
+(4)The
+ "as adjusted" calculation equals the "as adjusted" total assets,
+ less the "as adjusted" total liabilities, less the "as adjusted"
+ shareholders equity.
+
+ 
+
+(5)Excludes
+ 10,000,000 ordinary shares purchased in the public market which are subject to redemption
+ in connection with our initial business combination. The "as adjusted" calculation
+ equals the "as adjusted" total assets, less the "as adjusted" total
+ liabilities, less the value of ordinary shares that may be redeemed in connection with our
+ initial business combination (approximately $10.00 per share).
+
+ 
+
+If
+no business combination is completed within 9 months from the closing of this offering (or up to 21 months from the closing of this offering
+if we extend the period of time to consummate a business combination, as described in more detail in this prospectus), the proceeds then
+on deposit in the trust account, including interest (which interest shall be net of taxes payable, and less up to $50,000 of interest
+to pay dissolution expenses) will be used to fund the redemption of our public shares. Our sponsor, officers and directors have entered
+into a letter agreement with us, pursuant to which they have agreed to waive their rights to liquidating distributions from the trust
+account with respect to their founder shares and private placement shares if we fail to complete our initial business combination within
+such 9 month (or up to 21 month) time period.
+
+ 
+
+ 28
+
+ Table of Contents
+
+ 
+
+ 
+
+RISK
+FACTORS
+
+ 
+
+An
+investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together
+with the other information contained in this prospectus, before making a decision to invest in our units. If any of the following events
+occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price
+of our securities could decline, and you could lose all or part of your investment.
+
+ 
+
+General
+Risks to Investing in a SPAC entity and Completing a Business Combination
+
+ 
+
+We
+have no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective.
+
+ 
+
+We
+were incorporated in March 2021 under the laws of the Cayman Islands and to date have had no operating results, and we will not
+commence operations until obtaining funding through this offering. Because we lack an operating history, you have no basis upon which
+to evaluate our ability to achieve our business objective of completing our initial business combination with one or more target businesses.
+We have no plans, arrangements or understandings with any prospective target business concerning a business combination and may be unable
+to complete our initial business combination. If we fail to complete our initial business combination, we will never generate any operating
+revenues.
+
+ 
+
+Our
+independent registered public accounting firm s report contains an explanatory paragraph that expresses substantial doubt about
+our ability to continue as a "going concern."
+
+ 
+
+As
+of December 31, 2021, we had $ 95,978 in cash and a working capital deficit of $236,372, excluding deferred offering costs. Further,
+we expect to incur significant costs in pursuit of our financing and acquisition plans. Management s plans to address this need
+for capital through this offering are discussed in the section of this prospectus titled "Management s Discussion and Analysis
+of Financial Condition and Results of Operations." Our plans to raise capital and to consummate our initial business combination
+may not be successful. These factors, among others, raise substantial doubt about our ability to continue as a going concern. The financial
+statements contained elsewhere in this prospectus do not include any adjustments that might result from our inability to consummate this
+offering or our inability to continue as a going concern.
+
+ 
+
+Our
+public shareholders may not be afforded an opportunity to vote on our proposed business combination, which means we may complete our
+initial business combination even though a majority of our public shareholders do not support such a combination.
+
+ 
+
+We
+may not hold a shareholder vote to approve our initial business combination unless the business combination would require shareholder
+approval under applicable Cayman Islands law or the rules of the NASDAQ or if we decide to hold a shareholder vote for business
+or other reasons. Examples of transactions that would not ordinarily require shareholder approval include asset acquisitions and share
+purchases, while transactions such as direct mergers with our company or transactions where we issue more than 20% of our outstanding
+shares would require shareholder. For instance, the NASDAQ rules currently allow us to engage in a tender offer in lieu of a shareholder
+meeting but would still require us to obtain shareholder approval if we were seeking to issue more than 20% of our outstanding shares
+to a target business as consideration in any business combination. Therefore, if we were structuring a business combination that required
+us to issue more than 20% of our outstanding shares, we would seek shareholder approval of such business combination. Except as required
+by law or NASDAQ rules, the decision as to whether we will seek shareholder approval of a proposed business combination or will allow
+shareholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety
+of factors, such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek shareholder
+approval. Accordingly, we may consummate our initial business combination even if holders of a majority of the issued and outstanding
+ordinary shares do not approve of the business combination we consummate. Please see the section entitled "Proposed Business —
+Effecting Our Initial Business Combination — Shareholders may not have the ability to approve our initial business combination"
+for additional information.
+
+ 
+
+ 29
+
+ Table of Contents
+
+ 
+
+ 
+
+If
+we seek shareholder approval of our initial business combination, our sponsor, officers and directors have agreed to vote in favor of
+such initial business combination, regardless of how our public shareholders vote.
+
+ 
+
+Unlike
+other blank check companies in which the initial shareholders agree to vote their founder shares in accordance with the majority of the
+votes cast by the public shareholders in connection with an initial business combination, our sponsor, officers and directors have agreed
+(and their permitted transferees will agree), pursuant to the terms of a letter agreement entered into with us, to vote any founder shares
+and private placement shares held by them, as well as any public shares purchased during or after this offering, in favor of our initial
+business combination. We expect that our sponsor and its permitted transferees will own approximately 21.88% of our issued and outstanding
+ordinary shares at the time of any such shareholder vote (assuming it does not purchase units in this offering and taking into account
+ownership of the private placement units). As a result, in addition to our initial shareholder s founder shares, we would need
+only 3,600,001 or approximately 36% of the 10,000,000 public shares sold in this offering to be voted in favor of a transaction (assuming
+all outstanding shares are voted) in order to have our initial business combination approved (assuming the over-allotment option is not
+exercised). Accordingly, if we seek shareholder approval of our initial business combination, it is more likely that the necessary shareholder
+approval will be received than would be the case if such persons agreed to vote their founder shares in accordance with the majority
+of the votes cast by our public shareholders.
+
+ 
+
+Our
+sponsor has the right to extend the term we have to consummate our initial business combination, without providing our shareholders with
+redemption rights.
+
+ 
+
+We
+will have until 9 months from the closing of this offering to consummate our initial business combination. However, if we anticipate
+that we may not be able to consummate our initial business combination within 9 months, we may, by resolution of our board of directors
+if requested by our sponsor, extend the period of time to consummate a business combination up to twelve (12) times, each by an
+additional one month (for a total of up to 21 months to complete a business combination), subject to the deposit of additional funds
+into the trust account by our sponsor or its affiliates or designees as set out elsewhere in this prospectus. Our shareholders will not
+be entitled to vote or redeem their shares in connection with any such extension. In order for the time available for us to consummate
+our initial business combination to be extended, our sponsors or their affiliates or designees must deposit into the trust account.
+
+ 
+
+Any
+such payments would be made in the form of a non-interest-bearing loan from our sponsor or its affiliates or designees and would be repaid,
+if at all, from funds released to us upon completion of our initial business combination. The obligation to repay any such loans may
+reduce the amount available to us to pay as purchase price in our initial business combination, and/or may reduce the amount of funds
+available to the combined company following the initial business combination. This feature is different than the traditional special
+purpose acquisition company structure, in which any extension of the company s period to complete a business combination requires
+a vote of the company s shareholders and shareholders have the right to redeem their public shares in connection with such vote,
+and which do not provide the sponsor with the right to loan funds to the company to fund extension payments. In order to extend the time
+frame, our sponsor (or its affiliates or designees) must deposit into the trust account $333,333 or $383,332 if the underwriters 
+over-allotment option is exercised in full (approximately $0.033 per public share in either case) per month, up to an aggregate of $4,000,000
+(or $4,600,000 if the underwriters over-allotment option is exercised in full), or $0.40 per public share (representing the entire
+12 months extension), on or prior to the date of the applicable deadline, for each extension.
+
+ 
+
+Your
+only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your
+right to redeem your shares from us for cash, unless we seek shareholder approval of the business combination.
+
+ 
+
+At
+the time of your investment in us, you will not be provided with an opportunity to evaluate the specific merits or risks of one or more
+target businesses. Since our Board of Directors may complete a business combination without seeking shareholder approval, public shareholders
+may not have the right or opportunity to vote on the business combination, unless we seek such shareholder approval. Accordingly, if
+we do not seek shareholder approval, your only opportunity to affect the investment decision regarding a potential business combination
+may be limited to exercising your redemption rights within the period of time (which will be at least 20 business days) set forth in
+our tender offer documents mailed to our public shareholders in which we describe our initial business combination.
+
+ 
+
+ 30
+
+ Table of Contents
+
+ 
+
+ 
+
+The
+ability of our public shareholders to redeem their shares for cash may make our financial condition unattractive to potential business
+combination targets, which may make it difficult for us to enter into a business combination with a target.
+
+ 
+
+We
+may seek to enter into a business combination transaction agreement with a prospective target that requires as a closing condition that
+we have a minimum net worth or a certain amount of cash. If too many public shareholders exercise their redemption rights, we would not
+be able to meet such closing condition and, as a result, would not be able to proceed with the business combination. Furthermore, in
+no event will we redeem our public shares in an amount that would cause our net tangible assets, after payment of the deferred underwriting
+commissions, to be less than $5,000,001 upon consummation of our initial business combination (so that we are not subject to the SEC s
+"penny stock" rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating
+to our initial business combination. Consequently, if accepting all properly submitted redemption requests would cause our net tangible
+assets to be less than $5,000,001 upon consummation of our initial business combination or such greater amount necessary to satisfy a
+closing condition as described above, and we are unable to raise funds elsewhere, we would not proceed with such redemption and the related
+business combination and may instead search for an alternate business combination. Prospective targets will be aware of these risks and,
+thus, may be reluctant to enter into a business combination transaction with us.
+
+ 
+
+The
+ability of our public shareholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete
+the most desirable business combination or optimize our capital structure.
+
+ 
+
+At
+the time we enter into an agreement for our initial business combination, we will not know how many shareholders may exercise their redemption
+rights, and therefore we will need to structure the transaction based on our expectations as to the number of shares that will be submitted
+for redemption. If our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the
+purchase price, or requires us to have a minimum amount of cash at closing, we will need to reserve a portion of the cash in the trust
+account to meet such requirements, or arrange for third party financing. In addition, if a larger number of shares are submitted for
+redemption than we initially expected, we may need to restructure the transaction to reserve a greater portion of the cash in the trust
+account or arrange for third party financing. Raising additional third-party financing may involve dilutive equity issuances or the incurrence
+of indebtedness at higher than desirable levels. The above considerations may limit our ability to complete the most desirable business
+combination available to us or optimize our capital structure.
+
+ 
+
+The
+ability of our public shareholders to exercise redemption rights with respect to a large number of our shares could increase the probability
+that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares.
+
+ 
+
+If
+our initial business combination agreement requires us to use a portion of the cash in the trust account to pay the purchase price, or
+requires us to have a minimum amount of cash at closing, the probability that our initial business combination would be unsuccessful
+is increased. If our initial business combination is unsuccessful, you would not receive your pro rata portion of the trust account until
+we liquidate the trust account. If you are in need of immediate liquidity, you could attempt to sell your shares in the open market;
+however, at such time our shares may trade at a discount to the pro rata amount per share in the trust account. In either situation,
+you may suffer a material loss on your investment or lose the benefit of funds expected in connection with our redemption until we liquidate
+or you are able to sell your shares in the open market.
+
+ 
+
+If
+we seek shareholder approval of our initial business combination, our sponsor, directors, executive officers, advisors and their affiliates
+may elect to purchase public shares or warrants, which may influence a vote on a proposed business combination and reduce the public
+"float" of our ordinary shares or public warrants.
+
+ 
+
+If
+we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
+combination pursuant to the tender offer rules, our sponsor, directors, executive officers, advisors or their affiliates may purchase
+Public Shares or Warrants in privately negotiated transactions or in the open market either prior to or following the completion of our
+initial business combination, although they are under no obligation to do so. However, they have no current commitments, plans or intentions
+to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds in the trust
+account will be used to purchase Public Shares or Warrants in such transactions.
+
+ 
+
+ 31
+
+ Table of Contents
+
+ 
+
+ 
+
+In
+the event that our sponsor, directors, executive officers, advisors or their affiliates purchase shares in privately negotiated transactions
+from public shareholders who have already elected to exercise their redemption rights, such selling shareholders would be required to
+revoke their prior elections to redeem their shares. The purpose of any such transaction could be to (1) vote in favor of the business
+combination and thereby increase the likelihood of obtaining shareholder approval of the business combination, (2) reduce the number
+of Public Warrants outstanding or vote such warrants on any matters submitted to the warrant holders for approval in connection with
+our initial business combination or (3) satisfy a closing condition in an agreement with a target that requires us to have a minimum
+net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would
+otherwise not be met. Any such purchases of our securities may result in the completion of our initial business combination that may
+not otherwise have been possible. In addition, if such purchases are made, the public "float" of our ordinary shares or Public
+Warrants may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain
+or obtain the quotation, listing or trading of our securities on a national securities exchange such as Nasdaq. Any such purchases will
+be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements.
+
+ 
+
+The
+requirement that we complete our initial business combination within the prescribed time frame may give potential target businesses leverage
+over us in negotiating a business combination and may decrease our ability to conduct due diligence on potential business combination
+targets as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms
+that would produce value for our shareholders.
+
+ 
+
+Any
+potential target business with which we enter into negotiations concerning a business combination will be aware that we must complete
+our initial business combination within 9 months from the closing of this offering (or up to 21 months from the closing of this offering
+if we extend the period of time to consummate a business combination, as described in more detail in this prospectus). Consequently,
+such target business may obtain leverage over us in negotiating a business combination, knowing that if we do not complete our initial
+business combination with that particular target business, we may be unable to complete our initial business combination with any target
+business. This risk will increase as we get closer to the timeframe described above. In addition, we may have limited time to conduct
+due diligence and may enter into our initial business combination on terms that we would have rejected upon a more comprehensive investigation.
+
+ 
+
+As
+the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may
+be more competition for attractive targets. This could increase the cost of our initial business combination and could even result in
+our inability to find a target or to consummate an initial business combination.
+
+ 
+
+In
+recent years and especially in the last several months, the number of special purpose acquisition companies that have been formed has
+increased substantially. Many potential targets for special purpose acquisition companies have already entered into an initial business
+combination, and there are still many special purpose acquisition companies seeking targets for their initial business combination, as
+well as many such companies currently in registration. As a result, at times, fewer attractive targets may be available, and it may require
+more time, more effort and more resources to identify a suitable target and to consummate an initial business combination.
+
+ 
+
+In
+addition, because there are more special purpose acquisition companies seeking to enter into an initial business combination with available
+targets, the competition for available targets with attractive fundamentals or business models may increase, which could cause targets
+companies to demand improved financial terms. Attractive deals could also become scarcer for other reasons, such as economic or industry
+sector downturns, geopolitical tensions, or increases in the cost of additional capital needed to close business combinations or operate
+targets post-business combination. This could increase the cost of, delay or otherwise complicate or frustrate our ability to find and
+consummate an initial business combination, and may result in our inability to consummate an initial business combination on terms favorable
+to our investors altogether.
+
+ 
+
+Changes
+in the market for directors and officers liability insurance could make it more difficult and more expensive for us to
+negotiate and complete an initial business combination.
+
+ 
+
+In
+recent months, the market for directors and officers liability insurance for special purpose acquisition companies has
+changed. The premiums charged for such policies have generally increased and the terms of such policies have generally become less favorable.
+There can be no assurance that these trends will not continue.
+
+ 
+
+ 32
+
+ Table of Contents
+
+ 
+
+ 
+
+The
+increased cost and decreased availability of directors and officers liability insurance could make it more difficult and
+more expensive for us to negotiate an initial business combination. In order to obtain directors and officers liability insurance or
+modify its coverage as a result of becoming a public company, the post-business combination entity might need to incur greater expense,
+accept less favorable terms or both. However, any failure to obtain adequate directors and officers liability insurance could have an
+adverse impact on the post-business combination s ability to attract and retain qualified officers and directors.
+
+ 
+
+In
+addition, even after we were to complete an initial business combination, our directors and officers could still be subject to potential
+liability from claims arising from conduct alleged to have occurred prior to the initial business combination. As a result, in order
+to protect our directors and officers, the post-business combination entity will likely need to purchase additional insurance with respect
+to any such claims ("run-off insurance"). The need for run-off insurance would be an added expense for the post-business
+combination entity, and could interfere with or frustrate our ability to consummate an initial business combination on terms favorable
+to our investors.
+
+ 
+
+We
+may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all operations
+except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public shareholders may only
+receive $10.00 per share, or less than such amount in certain circumstances, and our rights and warrants will expire worthless.
+
+ 
+
+Our
+sponsor, officers and directors have agreed that we must complete our initial business combination within 9 months from the closing of
+this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination,
+as described in more detail in this prospectus). We may not be able to find a suitable target business and complete our initial business
+combination within such time period. If we have not completed our initial business combination within such time period, we will: (i) cease
+all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days
+thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust
+account, including interest (which interest shall be net of taxes payable, and less up to $50,000 of interest to pay dissolution expenses)
+divided by the number of then issued and outstanding public shares, which redemption will completely extinguish public shareholders 
+rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as
+promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our Board of Directors,
+liquidate and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements
+of other applicable law. In such case, our public shareholders may only receive $10.00 per share, and our rights and warrants will expire
+worthless. In certain circumstances, our public shareholders may receive less than $10.00 per share on the redemption of their shares.
+If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount
+received by shareholders may be less than $10.00 per share" and other risk factors herein.
+
+ 
+
+COVID-19
+and its impact on businesses and financial markets could have a material adverse effect on our search for a business combination and
+any target business with which we ultimately consummate a business combination.
+
+ 
+
+The
+COVID-19 coronavirus pandemic has resulted in a widespread health crisis that has adversely impacted the economies and financial markets
+worldwide, business operations and the conduct of commerce generally. There is no way of being certain how long these adverse impacts
+will last. The coronavirus, or other disease outbreaks, could have a material adverse effect on the business of any potential target
+business with which we consummate a business combination. Furthermore, we may be unable to complete a business combination if concerns
+relating to the coronavirus pandemic continue to restrict travel, limit the ability to have meetings with potential investors or the
+target company s personnel, vendors and services providers are unavailable to negotiate and consummate a transaction in a timely
+manner. The extent to which the coronavirus pandemic impacts our search for a business combination will depend on future developments,
+which are highly uncertain and cannot be predicted, including new information which may emerge concerning the coronavirus pandemic and
+the actions to contain it or treat its impact, among others. If the disruptions posed by the coronavirus or other matters of global concern
+continue for an extensive period of time, it could have a material adverse effect on our ability to consummate a business combination,
+or the operations of a target business with which we ultimately consummate a business combination.
+
+ 
+
+In
+addition, our ability to consummate a business combination may be dependent on the ability to raise equity and debt financing and the
+coronavirus pandemic and other related events could have a material adverse effect on our ability to raise adequate financing, including
+as a result of increased market volatility, decreased market liquidity and third-party financing being unavailable on terms acceptable
+to us or at all.
+
+ 
+
+In
+addition, our ability to consummate a transaction may be dependent on the ability to raise equity and debt financing which may be impacted
+by COVID-19 and other events, including as a result of increased market volatility and decreased market liquidity and third-party financing
+being unavailable on terms acceptable to us or at all.
+
+ 
+
+ 33
+
+ Table of Contents
+
+ 
+
+ 
+
+Our
+sponsor may decide not to extend the term we have to consummate our initial business combination, in which case we would cease all operations
+except for the purpose of winding up and we would redeem our public shares and liquidate, and the warrants and rights will be worthless.
+
+ 
+
+We
+will have until 9 months from the closing of this offering to consummate our initial business combination. However, if we anticipate
+that we may not be able to consummate our initial business combination within 9 months, we may, by resolution of our board if requested
+by our sponsor, extend the period of time to consummate a business combination up to twelve times, each by an additional one month (for
+a total of up to 21 months to complete a business combination), subject to the sponsor depositing additional funds into the trust account
+as set out below. In order for the time available for us to consummate our initial business combination to be extended, our sponsor or
+its affiliates or designees must deposit into the trust account $333,333, or $383,332 if the underwriters over-allotment option
+is exercised in full (approximately $0.033 per public share in either case), up to an aggregate of $4,000,000 (or $4,600,000 if the underwriters 
+over-allotment option is exercised in full), or $0.40 per public share, on or prior to the date of the applicable deadline, for each
+extension. Any such payments would be made in the form of a loan made from our sponsor or its affiliates or designees to us. The terms
+of the promissory note to be issued in connection with any such loans have not yet been negotiated other than that any such loan would
+be interest free and not be repaid unless we consummate a business combination. Consequently, such loans might not be made on the terms
+described in this prospectus. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time
+for us to complete our initial business combination. If we are unable to consummate our initial business combination within the applicable
+time period, we will, as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares for
+a pro rata portion of the funds held in the trust account and as promptly as reasonably possible following such redemption, subject to
+the approval of our remaining shareholders and our board of directors, dissolve and liquidate, subject in each case to our obligations
+under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. In such event, the warrants
+and rights will be worthless.
+
+ 
+
+If
+we seek shareholder approval of our initial business combination, our sponsor, directors, officers, advisors and their affiliates may
+elect to purchase shares from public shareholders, which may influence a vote on a proposed business combination and reduce the public
+"float" of our ordinary shares.
+
+ 
+
+If
+we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
+combination pursuant to the tender offer rules, our sponsor, directors, officers, advisors or their affiliates may purchase shares in
+privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination,
+although they are under no obligation to do so. Additionally or alternatively, our Sponsor, directors and officers may loan us funds
+which we may utilize to purchase securities from investors who otherwise may be seeking redemption, and we may use post-business combination
+funds of the Company to repay such loaned funds. Please see "Proposed Business — Permitted purchases of our securities"
+for a description of how such persons will determine which shareholders to seek to acquire shares from. Such a purchase may include a
+contractual acknowledgement that such shareholder, although still the record holder of our shares is no longer the beneficial owner thereof
+and therefore agrees not to exercise its redemption rights. In the event that our sponsor, directors, officers, advisors or their affiliates
+purchase shares in privately negotiated transactions from public shareholders who have already elected to exercise their redemption rights,
+such selling shareholders would be required to revoke their prior elections to redeem their shares. The price per share paid in any such
+transaction may be different than the amount per share a public shareholder would receive if it elected to redeem its shares in connection
+with our initial business combination. The purpose of such purchases could be to vote such shares in favor of the business combination
+and thereby increase the likelihood of obtaining shareholder approval of the business combination or to satisfy a closing condition in
+an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business
+combination, where it appears that such requirement would otherwise not be met. This may result in the completion of our initial business
+combination that may not otherwise have been possible.
+
+ 
+
+In
+addition, if such purchases are made, the public "float" of our ordinary shares and the number of beneficial holders of our
+securities may be reduced, possibly making it difficult to maintain or obtain the quotation, listing or trading of our securities on
+a national securities exchange.
+
+ 
+
+ 34
+
+ Table of Contents
+
+ 
+
+ 
+
+If
+a shareholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or
+fails to comply with the procedures for tendering its shares, such shares may not be redeemed.
+
+ 
+
+We
+will comply with the tender offer rules or proxy rules, as applicable, when conducting redemptions in connection with our initial
+business combination. Despite our compliance with these rules, if a shareholder fails to receive our tender offer or proxy materials,
+as applicable, such shareholder may not become aware of the opportunity to redeem its shares. In addition, the tender offer documents
+or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination
+will describe the various procedures that must be complied with in order to validly tender or redeem public shares. In the event that
+a shareholder fails to comply with these procedures, its shares may not be redeemed. See "Proposed Business — Business Strategy
+— Tendering share certificates in connection with a tender offer or redemption rights."
+
+ 
+
+You
+will not have any rights or interests in funds from the trust account, except under certain limited circumstances. To liquidate your
+investment, therefore, you may be forced to sell your public shares, rights or warrants, potentially at a loss.
+
+ 
+
+Our
+public shareholders will be entitled to receive funds from the trust account only upon the earlier to occur of: (i) the completion
+of our initial business combination, (ii) the redemption of any public shares properly tendered in connection with a shareholder
+vote to amend our amended and restated memorandum and articles of association to (A) modify the substance or timing of our obligation
+to redeem 100% of our public shares if we do not complete our initial business combination within 9 months from the closing of this offering
+(or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination, as described
+in more detail in this prospectus) or (B) with respect to any other provision relating to shareholders rights or pre-business
+combination activity and (iii) the redemption of all of our public shares if we are unable to complete our initial business combination
+within 9 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time
+to consummate a business combination, as described in more detail in this prospectus), subject to applicable law and as further described
+herein. In no other circumstances will a public shareholder have any right or interest of any kind in the trust account. Accordingly,
+to liquidate your investment, you may be forced to sell your public shares, rights or warrants, potentially at a loss.
+
+ 
+
+NASDAQ
+may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities
+and subject us to additional trading restrictions or reduce protections under NASDAQ rules available to them.
+
+ 
+
+We
+intend to apply to have our units listed on the NASDAQ on or promptly after the date of this prospectus and our ordinary shares, rights
+and warrants listed on or promptly after their date of separation. We cannot guarantee that our securities will be approved for listing
+on NASDAQ. Although after giving effect to this offering we expect to meet, on a pro forma basis, the minimum initial listing standards
+set forth in the NASDAQ listing standards, we cannot assure you that our securities will be, or will continue to be, listed on NASDAQ
+in the future or prior to our initial business combination. In order to continue listing our securities on NASDAQ prior to our initial
+business combination, we must maintain certain financial, distribution and stock price levels. Generally, we must maintain a minimum
+amount in shareholders equity (generally $2,500,000) and a minimum number of holders of our securities (generally 300 public holders).
+Additionally, following closing of our initial business combination, we will be required to demonstrate compliance with NASDAQ s
+initial listing requirements on a post-closing basis, which are more rigorous than NASDAQ s continued listing requirements, in
+order to continue to maintain the listing of our securities on NASDAQ. For instance, after closing, our stock price would generally be
+required to be at least $4.00 per share, our shareholders equity would generally be required to be at least $5.0 million and we
+would be required to have a minimum of 300 round lot holders of our securities. We cannot assure you that we will be able to meet those
+initial listing requirements at that time.
+
+ 
+
+ 35
+
+ Table of Contents
+
+ 
+
+ 
+
+If
+NASDAQ delists our securities prior to closing of any business combination, we and our investors could be subject to the following adverse
+consequences:
+
+ 
+
+ 
+ 
+ 
+ a
+ limited availability of market quotations for our securities;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ reduced
+ liquidity for our securities;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ a
+ determination that our ordinary shares is a "penny stock" which will require brokers trading in our ordinary shares to
+ adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for
+ our securities; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ lack of protection afforded under NASDAQ rules that requires any business combination have a fair market value of at least 80%
+ of the assets held in trust.
+
+ 
+ 
+
+If
+NASDAQ delists our securities from trading on its exchange following the closing of our business combination and we are not able to list
+our securities on another national securities exchange, we expect our securities could be quoted on an over-the-counter market. If this
+were to occur, we could face significant material adverse consequences, including:
+
+ 
+
+ 
+ 
+ 
+ a
+ limited availability of market quotations for our securities;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ reduced
+ liquidity for our securities;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ a
+ determination that our ordinary shares is a "penny stock" which will require brokers trading in our ordinary shares to
+ adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for
+ our securities;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ a
+ limited amount of news and analyst coverage; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ a
+ decreased ability to issue additional securities or obtain additional financing in the future.
+
+ 
+ 
+
+The
+National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the
+sale of certain securities, which are referred to as "covered securities." Because we expect that our units and eventually
+our ordinary shares, rights and warrants will be listed on NASDAQ, our units, ordinary shares, rights and warrants will be covered securities.
+Although the states are preempted from regulating the sale of our securities, the federal statute does allow the states to investigate
+companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the
+sale of covered securities in a particular case. While we are not aware of a state having used these powers to prohibit or restrict the
+sale of securities issued by blank check companies, other than the State of Idaho, certain state securities regulators view blank check
+companies unfavorably and might use these powers, or threaten to use these powers, to hinder the sale of securities of blank check companies
+in their states. Further, if we were no longer listed on NASDAQ, our securities would not be covered securities and we would be subject
+to regulation in each state in which we offer our securities, including in connection with our initial business combination.
+
+ 
+
+You
+will not be entitled to protections normally afforded to investors of many other blank check companies.
+
+ 
+
+Since
+the net proceeds of this offering and the sale of the private placement units are intended to be used to complete an initial business
+combination with a target business that has not been identified, we may be deemed to be a "blank check" company under the
+United States securities laws. However, because we will have net tangible assets in excess of $5,000,000 upon the successful completion
+of this offering and the sale of the private placement units and will file a Current Report on Form 8-K, including an audited balance
+sheet demonstrating this fact, we are exempt from rules promulgated by the SEC to protect investors in blank check companies, such
+as Rule 419. Accordingly, investors will not be afforded the benefits or protections of those rules. Among other things, this means
+our units will be immediately tradable and we may have a longer period of time to complete our initial business combination than do companies
+subject to Rule 419. Moreover, if this offering were subject to Rule 419, that rule would prohibit the release of any
+interest earned on funds held in the trust account to us unless and until the funds in the trust account were released to us in connection
+with our completion of an initial business combination. For a more detailed comparison of our offering to offerings that comply with
+Rule 419, please see "Proposed Business — Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419."
+
+ 
+
+ 36
+
+ Table of Contents
+
+ 
+
+ 
+
+If
+we seek shareholder approval of our initial business combination and we do not conduct redemptions pursuant to the tender offer rules,
+and if you or a "group" of shareholders are deemed to hold in excess of 15% of our ordinary shares, you will lose the ability
+to redeem all such shares in excess of 15% of our ordinary shares.
+
+ 
+
+If
+we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
+combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that a public
+shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as
+a "group" (as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with
+respect to more than an aggregate of 15% of the shares sold in this offering, which we refer to as the "Excess Shares." However,
+we would not be restricting our shareholders ability to vote all of their shares (including Excess Shares) for or against our
+initial business combination. Your inability to redeem the Excess Shares will reduce your influence over our ability to complete our
+initial business combination and you could suffer a material loss on your investment in us if you sell Excess Shares in open market transactions.
+Additionally, you will not receive redemption distributions with respect to the Excess Shares if we complete our initial business combination.
+And as a result, you will continue to hold that number of shares exceeding 15% and, in order to dispose of such shares, would be required
+to sell your shares in open market transactions, potentially at a loss.
+
+ 
+
+If
+we are unable to complete our initial business combination, our public shareholders may receive only approximately $10.00 per share,
+or less in certain circumstances, on our redemption, and our rights and warrants will expire worthless.
+
+ 
+
+We
+expect to encounter intense competition from other entities having a business objective similar to ours, including private investors
+(which may be individuals or investment partnerships), other blank check companies and other entities, domestic and international, competing
+for the types of businesses we intend to acquire. Many of these individuals and entities are well-established and have extensive experience
+in identifying and effecting, directly or indirectly, acquisitions of companies operating in or providing services to various industries.
+Many of these competitors possess greater technical, human and other resources or more local industry knowledge than we do and our financial
+resources will be relatively limited when contrasted with those of many of these competitors. While we believe there are numerous target
+businesses we could potentially acquire with the net proceeds of this offering and the sale of the private placement units, our ability
+to compete with respect to the acquisition of certain target businesses that are sizable will be limited by our available financial resources.
+This inherent competitive limitation gives others an advantage in pursuing the acquisition of certain target businesses. Furthermore,
+if we are obligated to pay cash for the ordinary shares redeemed and, in the event we seek shareholder approval of our initial business
+combination, we make purchases of our ordinary shares, potentially reducing the resources available to us for our initial business combination.
+Any of these obligations may place us at a competitive disadvantage in successfully negotiating a business combination. If we are unable
+to complete our initial business combination, our public shareholders may receive only approximately $10.00 per share (or less in certain
+circumstances) on the liquidation of our trust account and our rights and warrants will expire worthless. In certain circumstances, our
+public shareholders may receive less than $10.00 per share on the redemption of their shares. See "— If third parties bring
+claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders
+may be less than $10.00 per share" and other risk factors herein.
+
+ 
+
+If
+the net proceeds of this offering not being held in the trust account are insufficient to allow us to operate for at least the next 9
+months (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination, as
+described in more detail in this prospectus), we may be unable to complete our initial business combination.
+
+ 
+
+The
+funds available to us outside of the trust account may not be sufficient to allow us to operate for at least the next 9 months (or up
+to 21 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in
+more detail in this prospectus), assuming that our initial business combination is not completed during that time. We expect to incur
+significant costs in pursuit of our acquisition plans. Management s plans to address this need for capital through this offering
+and potential loans from certain of our affiliates are discussed in the section of this prospectus titled "Management s Discussion
+and Analysis of Financial Condition and Results of Operations." However, our affiliates are not obligated to make loans to us in
+the future, and we may not be able to raise additional financing from unaffiliated parties necessary to fund our expenses. Any such event
+in the future may negatively impact the analysis regarding our ability to continue as a going concern at such time.
+
+ 
+
+ 37
+
+ Table of Contents
+
+ 
+
+ 
+
+We
+believe that, upon the closing of this offering, the funds available to us outside of the trust account, will be sufficient to allow
+us to operate for at least the next 9 months (or up to 21 months from the closing of this offering if we extend the period of time to
+consummate a business combination, as described in more detail in this prospectus); however, we cannot assure you that our estimate is
+accurate. Of the funds available to us, we could use a portion of the funds available to us to pay fees to consultants to assist us with
+our search for a target business. We could also use a portion of the funds as a down payment or to fund a "no-shop" provision
+(a provision in letters of intent designed to keep target businesses from "shopping" around for transactions with other companies
+on terms more favorable to such target businesses) with respect to a particular proposed business combination, although we do not have
+any current intention to do so. If we entered into a letter of intent where we paid for the right to receive exclusivity from a target
+business and were subsequently required to forfeit such funds (whether as a result of our breach or otherwise), we might not have sufficient
+funds to continue searching for, or conduct due diligence with respect to, a target business. If we are unable to complete our initial
+business combination, our public shareholders may receive only approximately $10.00 per share (or less in certain circumstances) on the
+liquidation of our trust account and our rights and warrants will expire worthless. In such case, our public shareholders may only receive
+$10.00 per share, and our rights and warrants will expire worthless. In certain circumstances, our public shareholders may receive less
+than $10.00 per share on the redemption of their shares. See "If third parties bring claims against us, …the proceeds
+held in the trust account could be reduced and the per-share redemption amount received by shareholders may be less than $10.00 per share…"
+at page 39 and "If, before distributing the proceeds in the trust account to our public shareholders, we file a bankruptcy
+petition …" at page 41. If third parties bring claims against us, the proceeds held in the trust account could
+be reduced and the per-share redemption amount received by shareholders may be less than $10.00 per share" and other risk factors
+herein.
+
+ 
+
+If
+the net proceeds of this offering and the sale of the private placement units not being held in the trust account are insufficient, it
+could limit the amount available to fund our search for a target business or businesses and complete our initial business combination
+and we will depend on loans from our sponsor or management team to fund our search, to pay our taxes and to complete our initial business
+combination.
+
+ 
+
+Of
+the net proceeds of this offering and the sale of the private placement units and after payment of estimated offering expenses, only
+approximately $500,000 will be available to us initially outside the trust account to fund our working capital requirements. In the event
+that our offering expenses exceed our estimate of $500,000, we may fund such excess with funds not to be held in the trust account. In
+such case, the amount of funds we intend to be held outside the trust account would decrease by a corresponding amount. Conversely, in
+the event that the offering expenses are less than our estimate of $500,000, the amount of funds we intend to be held outside the trust
+account would increase by a corresponding amount. If we are required to seek additional capital, we would need to borrow funds from our
+sponsor, management team or other third parties to operate or may be forced to liquidate. Neither our sponsor, members of our management
+team nor any of their affiliates is under any obligation to advance funds to us in such circumstances. Any such advances would be repaid
+only from funds held outside the trust account or from funds released to us upon completion of our initial business combination. If we
+are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to
+cease operations and liquidate the trust account. Consequently, our public shareholders may only receive approximately $10.00 per share
+(or less in certain circumstances) on our redemption of our public shares, and our rights and warrants will expire worthless. In such
+case, our public shareholders may only receive $10.00 per share, and our rights and warrants will expire worthless. In certain circumstances,
+our public shareholders may receive less than $10.00 per share on the redemption of their shares. See "If third parties bring claims
+against us….." at page 39. If third parties bring claims against us, the proceeds held in the trust account could be reduced
+and the per-share redemption amount received by shareholders may be less than $10.00 per share" and other risk factors herein.
+
+ 
+
+ 38
+
+ Table of Contents
+
+ 
+
+ 
+
+Subsequent
+to the completion of our initial business combination, we may be required to take write-downs or write-offs, restructuring and impairment
+or other charges that could have a significant negative effect on our financial condition, results of operations and our share price,
+which could cause you to lose some or all of your investment.
+
+ 
+
+Even
+if we conduct extensive due diligence on a target business with which we combine, we cannot assure you that this diligence will surface
+all material issues that may be present inside a particular target business, that it would be possible to uncover all material issues
+through a customary amount of due diligence, or that factors outside of the target business and outside of our control will not later
+arise. As a result of these factors, we may be forced to later write-down or write-off assets, restructure our operations, or incur impairment
+or other charges that could result in our reporting losses. Even if our due diligence successfully identifies certain risks, unexpected
+risks may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though
+these charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature
+could contribute to negative market perceptions about us or our securities. In addition, charges of this nature may cause us to violate
+net worth or other covenants to which we may be subject as a result of assuming pre-existing debt held by a target business or by virtue
+of our obtaining post-combination debt financing. Accordingly, any shareholders who choose to remain shareholders following the business
+combination could suffer a reduction in the value of their shares. Such shareholders are unlikely to have a remedy for such reduction
+in value.
+
+ 
+
+If
+the warrants and private placement warrants are not classified as equity and are classified as a liability, we will have to incur significant
+expense in valuing such liabilities on a quarterly and annual basis, such liability would be reflected on our financial statements, and
+such classification may make it more difficult for us to complete an initial business combination.
+
+ 
+
+On
+April 12, 2021, the staff of the SEC issued a public statement entitled "Staff Statement on Accounting and Reporting Considerations
+for Warrants issued by Special Purpose Acquisition Companies ("SPACs"). In the statement, the SEC staff expressed its view
+that certain terms and conditions common to SPAC warrants may require the warrants to be classified as liabilities on the SPAC s
+balance sheet as opposed to equity. If applicable, the warrants should be classified as a liability measured at fair value, with changes
+in fair value required to be reflected in the SPACs quarterly and annual financial statements. It is possible that our public warrants
+and private placement warrants would therefore be classified as a liability. If we determine that our public warrants and private placement
+warrants would be classified as liabilities, prior to the effective date of the registration statement of which this prospectus forms
+a part, we may amend the terms of the public warrants and the private placement warrants in order that they may be classified as equity,
+however, there can be no assurance that such changes will result in the classification of the public warrants and private placement warrants
+as equity. If the warrants are not classified as equity and are classified as a liability, we will have to incur significant expense
+in valuing such liabilities on a quarterly and annual basis, such liability would be reflected on our financial statements, and such
+classification and ongoing expense may make it more difficult for us to complete an initial business combination. We have examined our
+Public Warrants and Private Warrants and determined, in consultation with our management team that these warrants qualify for equity
+treatment in our financial statements.
+
+ 
+
+If
+third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received
+by shareholders may be less than $10.00 per share.
+
+ 
+
+Our
+placing of funds in the trust account may not protect those funds from third-party claims against us. Although we will seek to have all
+vendors, service providers, prospective target businesses or other entities with which we do business execute agreements with us waiving
+any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit of our public shareholders,
+such parties may not execute such agreements, or even if they execute such agreements they may not be prevented from bringing claims
+against the trust account, including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar
+claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain advantage with respect to a claim
+against our assets, including the funds held in the trust account. If any third party refuses to execute an agreement waiving such claims
+to the monies held in the trust account, our management will perform an analysis of the alternatives available to it and will only enter
+into an agreement with a third party that has not executed a waiver if management believes that such third party s engagement would
+be significantly more beneficial to us than any alternative.
+
+ 
+
+ 39
+
+ Table of Contents
+
+ 
+
+ 
+
+Examples
+of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third party consultant
+whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would
+agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver. In addition,
+there is no guarantee that such entities will agree to waive any claims they may have in the future as a result of, or arising out of,
+any negotiations, contracts or agreements with us and will not seek recourse against the trust account for any reason. Upon redemption
+of our public shares, if we are unable to complete our initial business combination within the prescribed timeframe, or upon the exercise
+of a redemption right in connection with our initial business combination, we will be required to provide for payment of claims of creditors
+that were not waived that may be brought against us within the 10 years following redemption. Accordingly, the per-share redemption amount
+received by public shareholders could be less than the $10.00 per share initially held in the trust account, due to claims of such creditors.
+
+ 
+
+Our
+sponsor has agreed that it will be liable to us if and to the extent any claims by a vendor for services rendered or products sold to
+us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in
+the trust account to below (i) $10.00 per public share or (ii) such lesser amount per public share held in the trust account
+as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest
+which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access
+to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities,
+including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against
+a third party, our sponsor will not be responsible to the extent of any liability for such third party claims. We have not independently
+verified whether our sponsor has sufficient funds to satisfy their indemnity obligations and believe that our sponsor s only assets
+are securities of our company. Our sponsor may not have sufficient funds available to satisfy those obligations. We have not asked our
+sponsor to reserve for such obligations, and therefore, no funds are currently set aside to cover any such obligations. As a result,
+if any such claims were successfully made against the trust account, the funds available for our initial business combination and redemptions
+could be reduced to less than $10.00 per public share. In such event, we may not be able to complete our initial business combination,
+and you would receive such lesser amount per share in connection with any redemption of your public shares. None of our officers or directors
+will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses.
+
+ 
+
+Our
+directors may decide not to enforce the indemnification obligations of our sponsor, resulting in a reduction in the amount of funds in
+the trust account available for distribution to our public shareholders.
+
+ 
+
+In
+the event that the proceeds in the trust account are reduced below the lesser of (i) $10.00 per public share or (ii) such lesser
+amount per share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the
+trust assets, in each case net of the interest which may be withdrawn to pay taxes, and our sponsor asserts that it is unable to satisfy
+its obligations or that it has no indemnification obligations related to a particular claim, our independent directors would determine
+whether to take legal action against our sponsor to enforce its indemnification obligations. While we currently expect that our independent
+directors would take legal action on our behalf against our sponsor to enforce its indemnification obligations to us, it is possible
+that our independent directors in exercising their business judgment may choose not to do so in any particular instance. If our independent
+directors choose not to enforce these indemnification obligations, the amount of funds in the trust account available for distribution
+to our public shareholders may be reduced below $10.00 per share.
+
+ 
+
+If,
+after we distribute the proceeds in the trust account to our public shareholders, we file a bankruptcy petition or an involuntary bankruptcy
+petition is filed against us that is not dismissed, a bankruptcy court may seek to recover such proceeds, and the members of our Board
+of Directors may be viewed as having breached their fiduciary duties to our creditors, thereby exposing the members of our Board of Directors
+and us to claims of punitive damages.
+
+ 
+
+If,
+after we distribute the proceeds in the trust account to our public shareholders, we file a bankruptcy petition or an involuntary bankruptcy
+petition is filed against us that is not dismissed, any distributions received by shareholders could be viewed under applicable debtor/creditor
+and/or bankruptcy laws as either a "preferential transfer" or a "fraudulent conveyance." As a result, a bankruptcy
+court could seek to recover all amounts received by our shareholders. In addition, our Board of Directors may be viewed as having breached
+its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing itself and us to claims of punitive damages, by
+paying public shareholders from the trust account prior to addressing the claims of creditors.
+
+ 
+
+ 40
+
+ Table of Contents
+
+ 
+
+ 
+
+If,
+before distributing the proceeds in the trust account to our public shareholders, we file a bankruptcy petition or an involuntary bankruptcy
+petition is filed against us that is not dismissed, the claims of creditors in such proceeding may have priority over the claims of our
+shareholders and the per-share amount that would otherwise be received by our shareholders in connection with our liquidation may be
+reduced.
+
+ 
+
+If,
+before distributing the proceeds in the trust account to our public shareholders, we file a bankruptcy petition or an involuntary bankruptcy
+petition is filed against us that is not dismissed, the proceeds held in the trust account could be subject to applicable bankruptcy
+law, and may be included in our bankruptcy estate and subject to the claims of third parties with priority over the claims of our shareholders.
+To the extent any bankruptcy claims deplete the trust account, the per-share amount that would otherwise be received by our shareholders
+in connection with our liquidation may be reduced.
+
+ 
+
+If
+we are deemed to be an investment company under the Investment Company Act, we may be required to institute burdensome compliance requirements
+and our activities may be restricted, which may make it difficult for us to complete our initial business combination.
+
+ 
+
+If
+we are deemed to be an investment company under the Investment Company Act, our activities may be restricted, including:
+
+ 
+
+ restrictions
+ on the nature of our investments; and
+
+ 
+
+ restrictions
+ on the issuance of securities;
+
+ 
+
+each of which
+may make it difficult for us to complete our initial business combination.
+
+ 
+
+In
+addition, we may have imposed upon us burdensome requirements, including:
+
+ 
+
+ registration
+ as an investment company;
+
+ 
+
+ adoption
+ of a specific form of corporate structure; and
+
+ 
+
+ reporting,
+ record keeping, voting, proxy and disclosure requirements and other rules and regulations.
+
+ 
+
+We
+do not believe that our anticipated principal activities will subject us to the Investment Company Act. The proceeds held in the trust
+account may be invested by the trustee only in United States government treasury bills with a maturity of 180 days or less or in money
+market funds investing solely in United States Treasuries and meeting certain conditions under Rule 2a-7 under the Investment Company
+Act. Because the investment of the proceeds will be restricted to these instruments, we believe we will meet the requirements for the
+exemption provided in Rule 3a-1 promulgated under the Investment Company Act. If we were deemed to be subject to the Investment
+Company Act, compliance with these additional regulatory burdens would require additional expenses for which we have not allotted funds
+and may hinder our ability to complete a business combination. If we are unable to complete our initial business combination, our public
+shareholders may receive only approximately $10.00 per share, or less in certain circumstances, on the liquidation of our trust account
+and our rights and warrants will expire worthless.
+
+ 
+
+Changes
+in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, investments and results
+of operations.
+
+ 
+
+We
+are subject to laws and regulations enacted by national, regional and local governments. In particular, we will be required to comply
+with certain SEC and other legal requirements. Compliance with, and monitoring of, applicable laws and regulations may be difficult,
+time consuming and costly. Those laws and regulations and their interpretation and application may also change from time to time and
+those changes could have a material adverse effect on our business, investments and results of operations. In addition, a failure to
+comply with applicable laws or regulations, as interpreted and applied, could have a material adverse effect on our business and results
+of operations.
+
+ 
+
+ 41
+
+ Table of Contents
+
+ 
+
+ 
+
+If
+we are unable to consummate our initial business combination within 9 months (or up to 21 months from the closing of this offering if
+we extend the period of time to consummate a business combination, as described in more detail in this prospectus) of the closing of
+this offering, our public shareholders may be forced to wait beyond such 9 months (or up to 21 months) before redemption from our trust
+account.
+
+ 
+
+If
+we are unable to consummate our initial business combination within 9 months from the closing of this offering (or up to 21 months from
+the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this
+prospectus), we will distribute the aggregate amount then on deposit in the trust account (less the net interest earned thereon to pay
+dissolution expenses), pro rata to our public shareholders by way of redemption and cease all operations except for the purposes of winding
+up of our affairs, as further described herein. Any redemption of public shareholders from the trust account shall be effected automatically
+by function of our amended and restated memorandum and articles of association prior to any voluntary winding up. If we are required
+to windup, liquidate the trust account and distribute such amount therein, pro rata, to our public shareholders, as part of any liquidation
+process, such winding up, liquidation and distribution must comply with the applicable provisions of the Companies Act. In that case,
+investors may be forced to wait beyond the initial 9 months (or up to 21 months) before the redemption proceeds of our trust account
+become available to them and they receive the return of their pro rata portion of the proceeds from our trust account. We have no obligation
+to return funds to investors prior to the date of our redemption or liquidation unless we consummate our initial business combination
+prior thereto and only then in cases where investors have sought to redeem their ordinary shares. Only upon our redemption or any liquidation
+will public shareholders be entitled to distributions if we are unable to complete our initial business combination.
+
+ 
+
+Our
+shareholders may be held liable for claims by third parties against us to the extent of distributions received by them upon redemption
+of their shares.
+
+ 
+
+If
+we are forced to enter into an insolvent liquidation, any distributions received by shareholders could be viewed as an unlawful payment
+if it was proved that immediately following the date on which the distribution was made, we were unable to pay our debts as they fall
+due in the ordinary course of business. As a result, a liquidator could seek to recover all amounts received by our shareholders. Furthermore,
+our directors may be viewed as having breached their fiduciary duties to us or our creditors and/or may have acted in bad faith, and
+thereby exposing themselves and our company to claims, by paying public shareholders from the trust account prior to addressing the claims
+of creditors. We cannot assure you that claims will not be brought against us for these reasons. We and our directors and officers who
+knowingly and willfully authorized or permitted any distribution to be paid out of our share premium account while we were unable to
+pay our debts as they fall due in the ordinary course of business would be guilty of an offence and may be liable to fines and to imprisonment
+for five years in the Cayman Islands.
+
+ 
+
+We
+may not hold an annual meeting of shareholders until after the consummation of our initial business combination.
+
+ 
+
+In
+accordance with NASDAQ corporate governance requirements, we are not required to hold an annual meeting until no later than one year
+after our first fiscal year end following our listing on NASDAQ. In connection with completion of any business combination, we would
+expect to hold a special meeting of shareholders to obtain consent of our shareholders. Therefore, we may complete a business combination
+without holding an annual meeting of shareholders. There is no requirement under the Companies Act for us to hold annual or general meetings
+or elect directors. Until we hold an annual meeting of shareholders, public shareholders may not be afforded the opportunity to discuss
+company affairs with management.
+
+ 
+
+ 42
+
+ Table of Contents
+
+ 
+
+ 
+
+Risk Related
+to Our Securities
+
+ 
+
+We
+are not registering the ordinary shares issuable upon exercise of the warrants under the Securities Act or any state securities laws
+at this time, and such registration may not be in place when an investor desires to exercise warrants, thus precluding such investor
+from being able to exercise its warrants except on a cashless basis and potentially causing such warrants to expire worthless.
+
+ 
+
+We
+are not registering the ordinary shares issuable upon exercise of the warrants under the Securities Act or any state securities laws
+at the time of completion of this offering. However, under the terms of the warrant agreement, we have agreed that as soon as practicable,
+but in no event later than 15 business days after the closing of our initial business combination, we will use our best efforts to file,
+and within 60 business days following our initial business combination to have declared effective, a registration statement covering
+such shares and maintain a current prospectus relating to the ordinary shares issuable upon exercise of the warrants, until the expiration
+of the warrants in accordance with the provisions of the warrant agreement. We cannot assure you that we will be able to do so if, for
+example, any facts or events arise which represent a fundamental change in the information set forth in the registration statement or
+prospectus, the financial statements contained or incorporated by reference therein are not current or correct or the SEC issues a stop
+order. If the shares issuable upon exercise of the warrants are not registered under the Securities Act, we will be required to permit
+holders to exercise their warrants on a cashless basis. However, no warrant will be exercisable for cash or on a cashless basis, and
+we will not be obligated to issue any shares to holders seeking to exercise their warrants, unless the issuance of the shares upon such
+exercise is registered or qualified under the securities laws of the state of the exercising holder, or an exemption is available. Notwithstanding
+the foregoing, if a registration statement covering the ordinary shares issuable upon exercise of the warrants is not effective within
+a specified period following the consummation of our initial business combination, warrant holders may, until such time as there is an
+effective registration statement and during any period when we shall have failed to maintain an effective registration statement, exercise
+warrants on a cashless basis pursuant to the exemption provided by Section 3(a)(9) of the Securities Act, provided that such
+exemption is available. If that exemption, or another exemption, is not available, holders will not be able to exercise their warrants
+on a cashless basis. We will use our best efforts to register or qualify the shares under applicable blue sky laws to the extent an exemption
+is not available. In no event will we be required to net cash settle any warrant, or issue securities or other compensation in exchange
+for the warrants in the event that we are unable to register or qualify the shares underlying the warrants under applicable state securities
+laws and no exemption is available. If the issuance of the shares upon exercise of the warrants is not so registered or qualified or
+exempt from registration or qualification, the holder of such warrant shall not be entitled to exercise such warrant and such warrant
+may have no value and expire worthless. In such event, holders who acquired their warrants as part of a purchase of units will have paid
+the full unit purchase price solely for the ordinary shares included in the units. If and when the warrants become redeemable by us,
+we may not exercise our redemption right if the issuance of shares upon exercise of the warrants is not exempt from registration or qualification
+under applicable state blue sky laws or we are unable to effect such registration or qualification. We will use our best efforts to register
+or qualify such shares under the blue sky laws of the state of residence in those states in which the warrants were offered by us in
+this offering.
+
+ 
+
+In
+the event that we are not the surviving entity upon the consummation of our initial business combination, and there is no effective registration
+statement for the offering of the shares underlying the rights, the rights may expire worthless.
+
+ 
+
+If
+we enter into a definitive agreement for a business combination in which we will not be the surviving entity, the definitive agreement
+will provide for the holders of rights to receive the same per share consideration the holders of the ordinary shares will receive in
+the transaction on an as-converted into ordinary share basis, and each holder of a right will be required to affirmatively convert his,
+her or its rights in order to receive the 1/10 share underlying each right (without paying any additional consideration) upon consummation
+of the business combination. More specifically, the right holder will be required to indicate his, her or its election to convert the
+rights into underlying shares as well as to return the original rights certificates to us. In the event that we are not the surviving
+entity upon the consummation of our initial business combination, and there is no effective registration statement for the offering of
+the shares underlying the rights, the rights may expire worthless.
+
+ 
+
+ 43
+
+ Table of Contents
+
+ 
+
+ 
+
+The
+grant of registration rights to our sponsor and holders of our private placement units may make it more difficult to complete our initial
+business combination, and the future exercise of such rights may adversely affect the market price of our ordinary shares.
+
+ 
+
+Pursuant
+to an agreement to be entered into concurrently with the issuance and sale of the securities in this offering, our sponsor and its permitted
+transferees can demand that we register their founder shares. In addition, holders of our private placement units and their permitted
+transferees can demand that we register the private placement units and their underlying securities, and holders of units that may be
+issued upon conversion of working capital loans, may demand that we register such units and their underlying securities. We will bear
+the cost of registering these securities. The registration and availability of such a significant number of securities for trading in
+the public market may have an adverse effect on the market price of our ordinary shares. In addition, the existence of the registration
+rights may make our initial business combination more costly or difficult to conclude. This is because the shareholders of the target
+business may increase the equity stake they seek in the combined entity or ask for more cash consideration to offset the negative impact
+on the market price of our ordinary shares that is expected when the ordinary shares owned by our sponsor, holders of our private placement
+units or holders of our working capital loans or their respective permitted transferees are registered.
+
+ 
+
+ A provision of our warrant agreement may make it more difficult
+for us to consummate an initial business combination. 
+
+ 
+
+ If: 
+
+ 
+
+ (1) we
+issue additional ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of our initial
+business combination at an issue price or effective issue price of less than $9.20 per ordinary share (with such issue price or effective
+issue price to be determined in good faith by the board of directors); 
+
+ 
+
+ (2) the
+aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for
+the funding of our initial business combination, and 
+
+ 
+
+ (3) the volume weighted average trading
+price of the Company s ordinary shares during the 20 trading day period starting on the trading day prior to the day on which
+the Company consummates its initial business combination is below $9.20 per share, then the exercise price of the warrants will be
+adjusted to be equal to 115% of the market price, and the $18.00 per share redemption trigger price will be adjusted (to the nearest
+cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price, the $18.00 per share redemption trigger
+price will be adjusted (to the nearest cent) to be equal to 180% of the higher of the market price. This warrant provision may make
+it more difficult for us to consummate an initial business combination with a target business. 
+
+ 
+
+Because
+we are not limited to a particular industry or any specific target businesses with which to pursue our initial business combination,
+you will be unable to ascertain the merits or risks of any particular target business s operations.
+
+ 
+
+ We may seek to complete a business combination
+with an operating company in any industry or sector. However, we will not, under our amended and restated memorandum and articles of
+association, be permitted to effectuate our initial business combination with another blank check company or similar company with nominal
+operations. We have also determined that we will not consider or undertake a business combination with any entity or business that is
+based in the People s Republic of China, including Hong Kong and Macau, or that has its principal or a majority of its business
+operations (in such jurisdictions. Because we have not yet identified or approached any specific target business with respect to a business
+combination, there is no basis to evaluate the possible merits or risks of any particular target business s operations, results
+of operations, cash flows, liquidity, financial condition or prospects. To the extent we complete our initial business combination, we
+may be affected by numerous risks inherent in the business operations with which we combine. For example, if we combine with a financially
+unstable business or an entity lacking an established record of sales or earnings, we may be affected by the risks inherent in the business
+and operations of a financially unstable entity. Although our officers and directors will endeavor to evaluate the risks inherent in
+a particular target business, we cannot assure you that we will properly ascertain or assess all of the significant risk factors or that
+we will have adequate time to complete due diligence. Furthermore, some of these risks may be outside of our control and leave us with
+no ability to control or reduce the chances that those risks will adversely impact a target business. We also cannot assure you that
+an investment in our units will ultimately prove to be more favorable to investors than a direct investment, if such opportunity were
+available, in a business combination target. Accordingly, any shareholders who choose to remain shareholders following the business combination
+could suffer a reduction in the value of their shares. Such shareholders are unlikely to have a remedy for such reduction in value. 
+
+ 
+
+Past
+performance by our management team and their respective affiliates may not be indicative of future performance of an investment in us.
+
+ 
+
+Information
+regarding performance by, or businesses associated with, our management team and their affiliates is presented for informational purposes
+only. Past performance by our management team, including their affiliates past performance, is not a guarantee either (i) of
+success with respect to any business combination we may consummate or (ii) that we will be able to locate a suitable candidate for
+our initial business combination. You should not rely on the historical record of our management team and their affiliates as indicative
+of our future performance. Additionally, in the course of their respective careers, members of our management team have been involved
+in businesses and deals that were unsuccessful. Except for Mr. Man Chak Leung, none of our officers or directors has had experience operating
+a blank check company in the past.
+
+ 
+
+ 44
+
+ Table of Contents
+
+ 
+
+ 
+
+We
+may seek acquisition opportunities in industries or sectors or geographic regions that may be outside of our management s areas
+of expertise.
+
+ 
+
+We
+will consider a business combination outside of our management s areas of expertise if a business combination candidate is presented
+to us and we determine that such candidate offers an attractive acquisition opportunity for our company. Notwithstanding that several
+members of management have ties to China and may have expertise relative to China based businesses, we have determined that we will not
+consider or undertake a business combination with any entity or business with its principal or a majority of its business operations
+(either directly or through any subsidiaries and/or VIEs) in the People s Republic of China (including Hong Kong and Macau). In
+the event we elect to pursue an acquisition outside of the areas of our management s expertise, our management s expertise
+may not be directly applicable to its evaluation or operation, and the information contained in this prospectus regarding the areas of
+our management s expertise would not be relevant to an understanding of the business that we elect to acquire. As a result, our
+management may not be able to adequately ascertain or assess all of the significant risk factors. Accordingly, any shareholders who choose
+to remain shareholders following our initial business combination could suffer a reduction in the value of their shares. Such shareholders
+are unlikely to have a remedy for such reduction in value.
+
+ 
+
+Although
+we have identified general criteria and guidelines that we believe are important in evaluating prospective target businesses, we may
+enter into our initial business combination with a target that does not meet such criteria and guidelines, and as a result, the target
+business with which we enter into our initial business combination may not have attributes entirely consistent with our general criteria
+and guidelines.
+
+ 
+
+Although
+we have identified general criteria and guidelines for evaluating prospective target businesses, it is possible that a target business
+with which we enter into our initial business combination will not have all of these positive attributes. If we complete our initial
+business combination with a target that does not meet some or all of these guidelines, such combination may not be as successful as a
+combination with a business that does meet all of our general criteria and guidelines. In addition, if we announce a prospective business
+combination with a target that does not meet our general criteria and guidelines, a greater number of shareholders may exercise their
+redemption rights, which may make it difficult for us to meet any closing condition with a target business that requires us to have a
+minimum net worth or a certain amount of cash. In addition, if shareholder approval of the transaction is required by law, or we decide
+to obtain shareholder approval for business or other legal reasons, it may be more difficult for us to attain shareholder approval of
+our initial business combination if the target business does not meet our general criteria and guidelines. If we are unable to complete
+our initial business combination, our public shareholders may receive only approximately $10.00 per share on the liquidation of our trust
+account and our rights and warrants will expire worthless.
+
+ 
+
+We may
+seek acquisition opportunities with an early stage business, a financially unstable business or an entity lacking an established record
+of revenue or earnings. 
+
+ 
+
+To
+the extent we complete our initial business combination with a financially unstable business or an entity lacking an established record
+of sales or earnings, we may be affected by numerous risks inherent in the operations of the business with which we combine. We may consider
+a business combination with a business which may be considered in the development or early stages, with little revenue generated to date.
+Risks related to this type of business combination include difficulties in generating revenues for some period of time, volatile revenues,
+intense competition and difficulties in establishing a viable business or earnings and difficulties in obtaining and retaining key personnel.
+Although our officers and directors will endeavor to evaluate the risks inherent in a particular target business, we may not be able
+to properly ascertain or assess all of the significant risk factors and we may not have adequate time to complete due diligence. Furthermore,
+some of these risks may be outside of our control and leave us with no ability to control or reduce the chances that those risks will
+adversely impact a target business.
+
+ 
+
+We
+are not required to obtain an opinion from an independent investment banking or from an independent accounting firm, and consequently,
+you may have no assurance from an independent source that the price we are paying for the business is fair to our company from a financial
+point of view.
+
+ 
+
+Unless
+we complete our initial business combination with an affiliated entity, or our Board of Directors cannot independently determine the
+fair market value of the target business or businesses, we are not required to obtain an opinion from an independent investment banking
+firm, another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or from an
+independent accounting firm that the price we are paying for a target is fair to our company from a financial point of view. If no opinion
+is obtained, our shareholders will be relying on the business judgment of our Board of Directors, which will have significant discretion
+in choosing the standard used to establish the fair market value of the target or targets, and different methods of valuation may vary
+greatly in outcome from one another. Such standards used will be disclosed in our tender offer documents or proxy solicitation materials,
+as applicable, related to our initial business combination. However, if our Board of Directors is unable to determine the fair value
+of an entity with which we seek to complete an initial business combination based on such standards, we will be required to obtain an
+opinion as described above.
+
+ 
+
+ 45
+
+ Table of Contents
+
+ 
+
+ 
+
+We
+may issue additional ordinary to complete our initial business combination or under an employee incentive plan after completion of our
+initial business combination. Any such issuances would dilute the interest of our shareholders and likely present other risks.
+
+ 
+
+Our
+amended and restated memorandum and articles of association will authorize the issuance of up to 50,000,000 ordinary shares, par value
+$0.001 per share. Immediately after this offering, there will be 38,200,000 (assuming that the underwriters have not exercised their
+over-allotment option) authorized but unissued ordinary shares available for issuance, which amount takes into account shares reserved
+for issuance upon exercise of outstanding warrants and conversion of outstanding rights.
+
+ 
+
+We
+may issue a substantial number of additional ordinary shares in order to complete our initial business combination or under an employee
+incentive plan after completion of our initial business combination. However, our amended and restated memorandum and articles of association
+will provide, among other things, that prior to our initial business combination, we may not issue additional ordinary shares that would
+entitle the holders thereof to (i) receive funds from the trust account or (ii) vote on any initial business combination. The
+issuance of additional ordinary shares:
+
+ 
+
+ may
+ significantly dilute the equity interest of investors in this offering;
+
+ could
+ cause a change in control if a substantial number of ordinary shares are issued, which may
+ affect, among other things, our ability to use our net operating loss carry forwards, if
+ any, and could result in the resignation or removal of our present officers and directors;
+ and
+
+ may
+ adversely affect prevailing market prices for our units, ordinary shares and/or warrants.
+
+ 
+
+We
+may be a passive foreign investment company, or "PFIC," which could result in adverse U.S. federal income tax consequences
+to U.S. investors.
+
+ 
+
+If
+we are a PFIC for any taxable year (or portion thereof) that is included in the holding period of a U.S. holder (as defined in the section
+of this prospectus captioned "Income Tax Considerations — Certain U.S. Federal Income Tax Considerations — U.S. Holders")
+of our ordinary shares, rights or warrants, the U.S. holder may be subject to adverse U.S. federal income tax consequences and may be
+subject to additional reporting requirements. Our PFIC status for our current and subsequent taxable years may depend on whether we qualify
+for the PFIC start-up exception (see the section of this prospectus captioned "Income Tax Considerations — Certain U.S. Federal
+Income Tax Considerations — U.S. Holders — Passive Foreign Investment Company Rules"). Depending on the particular
+circumstances the application of the start-up exception may be subject to uncertainty, and there cannot be any assurance that we will
+qualify for the start-up exception. Accordingly, there can be no assurances with respect to our status as a PFIC for our current taxable
+year or any subsequent taxable year. Our actual PFIC status for any taxable year, however, will not be determinable until after the end
+of such taxable year. Moreover, if we determine we are a PFIC for any taxable year, we will endeavor to provide to a U.S. holder such
+information as the Internal Revenue Service ("IRS") may require, including a PFIC annual information statement, in order
+to enable the U.S. holder to make and maintain a "qualified electing fund" election, but there can be no assurance that we
+will timely provide such required information, and such election would be unavailable with respect to our warrants in all cases. We urge
+U.S. holders to consult their own tax advisors regarding the possible application of the PFIC rules to holders of our ordinary shares,
+rights and warrants. For a more detailed explanation of the tax consequences of PFIC classification to U.S. holders, see the section
+of this prospectus captioned "Income Tax Considerations — Certain U.S. Federal Income Tax Considerations — U.S. Holders
+— Passive Foreign Investment Company Rules."
+
+ 
+
+We
+may reincorporate in another jurisdiction in connection with our initial business combination and such reincorporation may result in
+taxes imposed on shareholders.
+
+ 
+
+We
+may, in connection with our initial business combination and subject to requisite shareholder approval under the Companies Act, reincorporate
+in the jurisdiction in which the target company or business is located. The transaction may require a shareholder to recognize taxable
+income in the jurisdiction in which the shareholder is a tax resident or in which its members are resident if it is a tax transparent
+entity. We do not intend to make any cash distributions to shareholders to pay such taxes. Shareholders may be subject to withholding
+taxes or other taxes with respect to their ownership of us after the reincorporation.
+
+ 
+
+ 46
+
+ Table of Contents
+
+ 
+
+ 
+
+Resources
+could be wasted in researching acquisitions that are not completed, which could materially adversely affect subsequent attempts to locate
+and acquire or merge with another business. If we are unable to complete our initial business combination, our public shareholders may
+receive only approximately $10.00 per share, or less than such amount in certain circumstances, on the liquidation of our trust account
+and our rights and warrants will expire worthless.
+
+ 
+
+We
+anticipate that the investigation of each specific target business and the negotiation, drafting and execution of relevant agreements,
+disclosure documents and other instruments will require substantial management time and attention and substantial costs for accountants,
+attorneys and others. If we decide not to complete a specific initial business combination, the costs incurred up to that point for the
+proposed transaction likely would not be recoverable. Furthermore, if we reach an agreement relating to a specific target business, we
+may fail to complete our initial business combination for any number of reasons including those beyond our control. Any such event will
+result in a loss to us of the related costs incurred which could materially adversely affect subsequent attempts to locate and acquire
+or merge with another business. If we are unable to complete our initial business combination, our public shareholders may receive only
+approximately $10.00 per share on the liquidation of our trust account and our rights and warrants will expire worthless. See "—
+If third parties bring claims against us, the proceeds held in the trust account could be reduced and the per-share redemption amount
+received by shareholders may be less than $10.00 per share" and other risk factors.
+
+ 
+
+We
+are dependent upon our officers and directors and their departure could adversely affect our ability to operate.
+
+ 
+
+Our
+operations are dependent upon a relatively small group of individuals and, in particular, Mr. Man Chak Leung and our other officers
+and directors. We believe that our success depends on the continued service of our officers and directors, at least until we have completed
+our initial business combination. In addition, our officers and directors are not required to commit any specified amount of time to
+our affairs and, accordingly, will have conflicts of interest in allocating management time among various business activities, including
+identifying potential business combinations and monitoring the related due diligence. We do not have an employment agreement with, or
+key-man insurance on the life of, any of our directors or officers. The unexpected loss of the services of one or more of our directors
+or officers could have a detrimental effect on us.
+
+ 
+
+Our
+ability to successfully effect our initial business combination and to be successful thereafter will be totally dependent upon the efforts
+of our key personnel, some of whom may join us following our initial business combination. The loss of key personnel could negatively
+impact the operations and profitability of our post-combination business.
+
+ 
+
+Our
+ability to successfully effect our initial business combination is dependent upon the efforts of our key personnel. The role of our key
+personnel in the target business, however, cannot presently be ascertained. Although some of our key personnel may remain with the target
+business in senior management or advisory positions following our initial business combination, it is likely that some or all of the
+management of the target business will remain in place. While we intend to closely scrutinize any individuals we engage after our initial
+business combination, we cannot assure you that our assessment of these individuals will prove to be correct. These individuals may be
+unfamiliar with the requirements of operating a company regulated by the SEC, which could cause us to have to expend time and resources
+helping them become familiar with such requirements.
+
+ 
+
+ 47
+
+ Table of Contents
+
+ 
+
+ 
+
+Our
+key personnel may negotiate employment or consulting agreements with a target business in connection with a particular business combination.
+These agreements may provide for them to receive compensation following our initial business combination and as a result, may cause them
+to have conflicts of interest in determining whether a particular business combination is the most advantageous.
+
+ 
+
+Our
+key personnel may be able to remain with the company after the completion of our initial business combination only if they are able to
+negotiate employment or consulting agreements in connection with the business combination. Such negotiations would take place simultaneously
+with the negotiation of the business combination and could provide for such individuals to receive compensation in the form of cash payments
+and/or our securities for services they would render to us after the completion of the business combination. The personal and financial
+interests of such individuals may influence their motivation in identifying and selecting a target business, subject to his or her fiduciary
+duties under Cayman Islands law. However, we believe the ability of such individuals to remain with us after the completion of our initial
+business combination will not be the determining factor in our decision as to whether or not we will proceed with any potential business
+combination. There is no certainty, however, that any of our key personnel will remain with us after the completion of our initial business
+combination. We cannot assure you that any of our key personnel will remain in senior management or advisory positions with us. The determination
+as to whether any of our key personnel will remain with us will be made at the time of our initial business combination.
+
+ 
+
+We
+may have a limited ability to assess the management of a prospective target business and, as a result, may effect our initial business
+combination with a target business whose management may not have the skills, qualifications or abilities to manage a public company.
+
+ 
+
+When
+evaluating the desirability of effecting our initial business combination with a prospective target business, our ability to assess the
+target business s management may be limited due to a lack of time, resources or information. Our assessment of the capabilities
+of the target s management, therefore, may prove to be incorrect and such management may lack the skills, qualifications or abilities
+we suspected. Should the target s management not possess the skills, qualifications or abilities necessary to manage a public company,
+the operations and profitability of the post-combination business may be negatively impacted. Accordingly, any shareholders who choose
+to remain shareholders following the business combination could suffer a reduction in the value of their shares. Such shareholders are
+unlikely to have a remedy for such reduction in value.
+
+ 
+
+The
+officers and directors of an acquisition candidate may resign upon completion of our initial business combination. The departure of a
+business combination target s key personnel could negatively impact the operations and profitability of our post-combination business.
+The role of an acquisition candidates key personnel upon the completion of our initial business combination cannot be ascertained
+at this time. Although we contemplate that certain members of an acquisition candidate s management team will remain associated
+with the acquisition candidate following our initial business combination, it is possible that members of the management of an acquisition
+candidate will not wish to remain in place.
+
+ 
+
+Our
+officers and directors will allocate their time to other businesses thereby causing conflicts of interest in their determination as to
+how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial
+business combination.
+
+ 
+
+Our
+officers and directors are not required to, and will not, commit their full time to our affairs, which may result in a conflict of interest
+in allocating their time between our operations and our search for a business combination and their other businesses. We do not intend
+to have any full-time employees prior to the completion of our initial business combination. Each of our officers is engaged in several
+other business endeavors for which he or she may be entitled to substantial compensation and our officers are not obligated to contribute
+any specific number of hours per week to our affairs. Our independent directors also serve as officers and board members for other entities.
+If our officers and directors other business affairs require them to devote substantial amounts of time to such affairs
+in excess of their current commitment levels, it could limit their ability to devote time to our affairs which may have a negative impact
+on our ability to complete our initial business combination. For a complete discussion of our officers and directors other
+business affairs, please see "Management — Directors and Officers."
+
+ 
+
+Certain
+of our officers and directors are now, and all of them may in the future become, affiliated with entities engaged in business activities
+similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular
+business opportunity should be presented.
+
+ 
+
+Following
+the completion of this offering and until we consummate our initial business combination, we intend to engage in the business of identifying
+and combining with one or more businesses. Our sponsor and officers and directors are, or may in the future become, affiliated with other
+blank check companies like ours or other entities (such as operating companies or investment vehicles) that are engaged in making and
+managing investments in a similar business.
+
+ 
+
+ 48
+
+ Table of Contents
+
+ 
+
+ 
+
+Our
+officers and directors also may become aware of business opportunities which may be appropriate for presentation to us and the other
+entities to which they owe certain fiduciary or contractual duties. Accordingly, they may have conflicts of interest in determining to
+which entity a particular business opportunity should be presented. These conflicts may not be resolved in our favor and a potential
+target business may be presented to other entities prior to its presentation to us, subject to his or her fiduciary duties under Cayman
+Islands law.
+
+ 
+
+For
+a complete discussion of our officers and directors business affiliations and the potential conflicts of interest that
+you should be aware of, please see "Management — Directors and Officers," "Management — Conflicts of Interest"
+and "Certain Relationships and Related Party Transactions."
+
+ 
+
+Our
+officers, directors, security holders and their respective affiliates may have competitive pecuniary interests that conflict with our
+interests.
+
+ 
+
+We
+have not adopted a policy that expressly prohibits our directors, officers, security holders or affiliates from having a direct or indirect
+pecuniary or financial interest in any investment to be acquired or disposed of by us or in any transaction to which we are a party or
+have an interest. In fact, we may enter into a business combination with a target business that is affiliated with our sponsor, our directors
+or officers, although we do not intend to do so. Nor do we have a policy that expressly prohibits any such persons from engaging for
+their own account in business activities of the types conducted by us. Accordingly, such persons or entities may have a conflict between
+their interests and ours.
+
+ 
+
+We
+may engage in a business combination with one or more target businesses that have relationships with entities that may be affiliated
+with our sponsor, officers, directors or existing holders which may raise potential conflicts of interest.
+
+ 
+
+In
+light of the involvement of our sponsor, officers and directors with other entities, we may decide to acquire one or more businesses
+affiliated with our sponsor, officers and directors. Our officers and directors also serve as officers and board members for other entities,
+including, without limitation, those described under "Management — Conflicts of Interest." Such entities may compete
+with us for business combination opportunities. Our sponsor, officers and directors are not currently aware of any specific opportunities
+for us to complete our initial business combination with any entities with which they are affiliated, and there have been no preliminary
+discussions concerning a business combination with any such entity or entities. Although we will not be specifically focusing on, or
+targeting, any transaction with any affiliated entities, we would pursue such a transaction if we determined that such affiliated entity
+met our criteria for a business combination as set forth in "Proposed Business — Effecting Our Initial Business Combination
+— Selection of a target business and structuring of our initial business combination" and such transaction was approved by
+a majority of our disinterested directors. Despite our agreement to obtain an opinion from an independent investment banking firm or
+another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or an independent
+accounting firm, regarding the fairness to our company from a financial point of view of a business combination with one or more domestic
+or international businesses affiliated with our officers, directors or existing holders, potential conflicts of interest still may exist
+and, as a result, the terms of the business combination may not be as advantageous to our public shareholders as they would be absent
+any conflicts of interest.
+
+ 
+
+Since
+our sponsor, officers and directors will lose their entire investment in us if our initial business combination is not completed, a conflict
+of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination.
+
+ 
+
+On
+July 5, 2021, our sponsor purchased an aggregate of 1,437,500 founder shares for an aggregate purchase price of $25,000, or approximately
+$0.02 per share. On September 26, 2021, the Company purchased back all the 1,437,500 founder shares for $25,000 and reissued 2,875,000
+shares to our sponsor for $25,000, or approximately $0.01 per shares. The Company has had no operations to date and was minimally capitalized
+with a minimal amount of funds from our sponsor as of December 31, 2021. As such, our sponsor will own approximately 21.88% of our issued
+and outstanding shares after this offering (assuming it does not purchase units in this offering and taking into account ownership of
+the private placement units). If we increase or decrease the size of the offering, we will effect a capitalization or share surrender
+or redemption or other appropriate mechanism, as applicable, immediately prior to the consummation of the offering in such amount as
+to maintain the ownership of our sponsor prior to this offering at 20% of our issued and outstanding ordinary shares upon the consummation
+of this offering (assuming it does not purchase units in this offering and not taking into account ownership of the private placement
+units). The founder shares will be worthless if we do not complete an initial business combination. In addition, our sponsor has committed
+to purchase an aggregate of 300,000 (or 330,000 if the underwriters over-allotment option is exercised in full) private placement
+units, for a purchase price of $3,000,000 in the aggregate (or $3,300,000 in the aggregate if the underwriters over-allotment
+option is exercised in full), or $10.00 per unit, that will also be worthless if we do not complete a business combination.
+
+ 
+
+ 49
+
+ Table of Contents
+
+ 
+
+ 
+
+ Each private placement unit consists of one
+private placement share, one private placement right, granting the holder thereof the right to receive one-tenth (1/10) of an ordinary
+share upon the consummation of an initial business combination, and one private placement warrant. Each private placement warrant may
+be exercised for one ordinary share at a price of $11.50 per share, subject to adjustment as provided herein. 
+
+ 
+
+The
+founder shares are identical to the ordinary shares included in the units being sold in this offering except that (i) the founder
+shares are subject to certain transfer restrictions and (ii) our sponsor, officers and directors have entered into a letter agreement
+with us, pursuant to which they have agreed (A) to waive their redemption rights with respect to their founder shares, private placement
+shares and public shares in connection with the completion of our initial business combination, (B) to waive their redemption rights
+with respect to any founder shares, private placement shares and public shares held by them in connection with a shareholder vote to
+approve an amendment to our amended and restated memorandum and articles of association (x) to modify the substance or timing of
+our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100%
+of our public shares if we have not consummated our initial business combination within the timeframe set forth therein or (y) with
+respect to any other provision relating to shareholders rights or pre-initial business combination activity and (C) to waive
+their rights to liquidating distributions from the trust account with respect to their founder shares and private placement shares if
+we fail to complete our initial business combination within 9 months from the closing of this offering (or up to 21 months from the closing
+of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus)
+(although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we
+fail to complete our initial business combination within the prescribed time frame).
+
+ 
+
+The
+personal and financial interests of our officers and directors may influence their motivation in identifying and selecting a target business
+combination, completing an initial business combination and influencing the operation of the business following the initial business
+combination.
+
+ 
+
+Since
+our sponsor, officers and directors may not be eligible to be reimbursed for their out-of-pocket expenses if our initial business combination
+is not completed, a conflict of interest may arise in determining whether a particular business combination target is appropriate for
+our initial business combination.
+
+ 
+
+At
+the closing of our initial business combination, our sponsor, officers and directors, or any of their respective affiliates, will be
+reimbursed for any out-of-pocket expenses incurred in connection with activities on our behalf such as identifying potential target businesses
+and performing due diligence on suitable business combinations. There is no cap or ceiling on the reimbursement of out-of-pocket expenses
+incurred in connection with activities on our behalf. These financial interests of our sponsor, officers and directors may influence
+their motivation in identifying and selecting a target business combination and completing an initial business combination.
+
+ 
+
+We
+may issue notes or other debt securities, or otherwise incur substantial debt, to complete a business combination, which may adversely
+affect our leverage and financial condition and thus negatively impact the value of our shareholders investment in us.
+
+ 
+
+Although
+we have no commitments as of the date of this prospectus to issue any notes or other debt securities, or to otherwise incur outstanding
+debt following this offering, we may choose to incur substantial debt to complete our initial business combination. We have agreed that
+we will not incur any indebtedness unless we have obtained from the lender a waiver of any right, title, interest or claim of any kind
+in or to the monies held in the trust account. As such, no issuance of debt will affect the per-share amount available for redemption
+from the trust account. Nevertheless, the incurrence of debt could have a variety of negative effects, including:
+
+ 
+
+ default
+ and foreclosure on our assets if our operating revenues after an initial business combination
+ are insufficient to repay our debt obligations;
+
+ 
+
+ acceleration
+ of our obligations to repay the indebtedness even if we make all principal and interest payments
+ when due if we breach certain covenants that require the maintenance of certain financial
+ ratios or reserves without a waiver or renegotiation of that covenant;
+
+ 
+
+ 50
+
+ Table of Contents
+
+ 
+
+ 
+
+ our
+ immediate payment of all principal and accrued interest, if any, if the debt security is
+ payable on demand;
+
+ 
+
+ our
+ inability to obtain necessary additional financing if the debt security contains covenants
+ restricting our ability to obtain such financing while the debt security is outstanding;
+
+ 
+
+ our
+ inability to pay dividends on our ordinary shares;
+
+ 
+
+ using
+ a substantial portion of our cash flow to pay principal and interest on our debt, which will
+ reduce the funds available for dividends on our ordinary shares if declared, expenses, capital
+ expenditures, acquisitions and other general corporate purposes;
+
+ 
+
+ limitations
+ on our flexibility in planning for and reacting to changes in our business and in the industry
+ in which we operate;
+
+ 
+
+ increased
+ vulnerability to adverse changes in general economic, industry and competitive conditions
+ and adverse changes in government regulation; and
+
+ 
+
+ limitations
+ on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions,
+ debt service requirements, execution of our strategy and other purposes and other disadvantages
+ compared to our competitors who have less debt.
+
+ 
+
+We
+may only be able to complete one business combination with the proceeds of this offering and the sale of the private placement units,
+which will cause us to be solely dependent on a single business which may have a limited number of products or services. This lack of
+diversification may negatively impact our operations and profitability.
+
+ 
+
+Of
+the net proceeds from this offering and the sale of the private placement units, $100,000,000 or $115,000,000 if the underwriters 
+over-allotment option is exercised in full) will be available to complete our business combination and pay related fees and expenses
+(which includes up to approximately $2,500,000 (or up to $2,875,000 if the over-allotment option is exercised in full, for the payment
+of deferred underwriting commissions).
+
+ 
+
+We
+may effectuate our initial business combination with a single target business or multiple target businesses simultaneously or within
+a short period of time. However, we may not be able to effectuate our initial business combination with more than one target business
+because of various factors, including the existence of complex accounting issues and the requirement that we prepare and file pro forma
+financial statements with the SEC that present operating results and the financial condition of several target businesses as if they
+had been operated on a combined basis. By completing our initial business combination with only a single entity our lack of diversification
+may subject us to numerous economic, competitive and regulatory risks. Further, we would not be able to diversify our operations or benefit
+from the possible spreading of risks or offsetting of losses, unlike other entities which may have the resources to complete several
+business combinations in different industries or different areas of a single industry. Accordingly, the prospects for our success may
+be:
+
+ 
+
+ solely
+ dependent upon the performance of a single business, property or asset; or
+
+ 
+
+ dependent
+ upon the development or market acceptance of a single or limited number of products, processes
+ or services.
+
+ 
+
+This
+lack of diversification may subject us to numerous economic, competitive and regulatory risks, any or all of which may have a substantial
+adverse impact upon the particular industry in which we may operate subsequent to our initial business combination.
+
+ 
+
+ 51
+
+ Table of Contents
+
+ 
+
+ 
+
+We
+may attempt to simultaneously complete business combinations with multiple prospective targets, which may hinder our ability to complete
+our initial business combination and give rise to increased costs and risks that could negatively impact our operations and profitability.
+
+ 
+
+If
+we determine to simultaneously acquire several businesses that are owned by different sellers, we will need for each of such sellers
+to agree that our purchase of its business is contingent on the simultaneous closings of the other business combinations, which may make
+it more difficult for us, and delay our ability, to complete our initial business combination. With multiple business combinations, we
+could also face additional risks, including additional burdens and costs with respect to possible multiple negotiations and due diligence
+investigations (if there are multiple sellers) and the additional risks associated with the subsequent assimilation of the operations
+and services or products of the acquired companies in a single operating business. If we are unable to adequately address these risks,
+it could negatively impact our profitability and results of operations.
+
+ 
+
+We
+may attempt to complete our initial business combination with a private company about which little information is available, which may
+result in a business combination with a company that is not as profitable as we suspected, if at all.
+
+ 
+
+In
+pursuing our acquisition strategy, we may seek to effectuate our initial business combination with a privately held company. Very little
+public information generally exists about private companies, and we could be required to make our decision on whether to pursue a potential
+initial business combination on the basis of limited information, which may result in a business combination with a company that is not
+as profitable as we suspected, if at all.
+
+ 
+
+Our
+management may not be able to maintain control of a target business after our initial business combination. We cannot provide assurance
+that, upon loss of control of a target business, new management will possess the skills, qualifications or abilities necessary to profitably
+operate such business.
+
+ 
+
+We
+may structure a business combination so that the post-transaction company in which our public shareholders own shares will own less than
+100% of the equity interests or assets of a target business, but we will only complete such business combination if the post-transaction
+company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest
+in the target sufficient for us not to be required to register as an investment company under the Investment Company Act. In the event
+that we acquire assets, we would expect to acquire assets that allow us to constitute an operating business. We will not consider any
+transaction that does not meet such criteria. Even if the post-transaction company owns 50% or more of the voting securities of the target,
+our shareholders prior to the business combination may collectively own a minority interest in the post business combination company,
+depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction
+in which we issue a substantial number of new ordinary shares in exchange for all of the outstanding capital stock of a target. In this
+case, we would acquire a 100% interest in the target. However, as a result of the issuance of a substantial number of new ordinary shares,
+our shareholders immediately prior to such transaction could own less than a majority of our issued and outstanding ordinary shares subsequent
+to such transaction. In addition, other minority shareholders may subsequently combine their holdings resulting in a single person or
+group obtaining a larger share of the company s stock than we initially acquired. Accordingly, this may make it more likely that
+our management will not be able to maintain our control of the target business.
+
+ 
+
+ 52
+
+ Table of Contents
+
+ 
+
+ 
+
+We
+do not have a specified maximum redemption threshold. The absence of such a redemption threshold may make it possible for us to complete
+a business combination with which a substantial majority of our shareholders do not agree.
+
+ 
+
+Our
+amended and restated memorandum and articles of association will not provide a specified maximum redemption threshold, in no event will
+we redeem our public shares in an amount that would cause our net tangible assets, after payment of the deferred underwriting commissions,
+to be less than $5,000,001 upon consummation of our initial business combination (such that we are not subject to the SEC s "penny
+stock" rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial
+business combination. As a result, we may be able to complete our initial business combination even though a substantial majority of
+our public shareholders do not agree with the transaction and have redeemed their shares or, if we seek shareholder approval of our initial
+business combination and do not conduct redemptions in connection with our initial business combination pursuant to the tender offer
+rules, have entered into privately negotiated agreements to sell their shares to our sponsor, officers, directors, advisors or their
+affiliates. In the event the aggregate cash consideration we would be required to pay for all ordinary shares that are validly submitted
+for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed
+the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, all ordinary shares
+submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate business combination.
+
+ 
+
+Investors
+may view our units as less attractive than those of other blank check companies.
+
+ 
+
+ Unlike other blank check companies that sell
+units comprised of shares and warrants each to purchase one full share in their initial public offerings, we are selling units comprised
+of ordinary shares, rights entitling the holder to receive one-tenth (1/10) of one ordinary share, and warrants to purchase one ordinary
+share. The rights and warrants will not have any voting rights and will expire and be worthless if we do not consummate an initial business
+combination. Furthermore, no fractional shares will be issued upon exercises of the warrants and it is not our intent to issue fractional
+shares upon conversion of any rights. As a result, if you acquire less than ten rights, you may, in our discretion, not receive one whole
+share. Any rounding down and extinguishment may be done with or without any in lieu cash payment or other compensation being made to
+the holder of the relevant rights. Accordingly, investors in this offering will not be issued the same securities as part of their investment
+as they may have in other blank check company offerings, which may have the effect of limiting the potential upside value of your investment
+in our company. 
+
+ 
+
+In
+order to effectuate an initial business combination, blank check companies have, in the recent past, amended various provisions of their
+charters and modified governing instruments. We cannot assure you that we will not seek to amend our amended and restated memorandum
+and articles of association or governing instruments in a manner that will make it easier for us to complete our initial business combination
+that our shareholders may not support.
+
+ 
+
+In
+order to effectuate a business combination, blank check companies have, in the past, amended various provisions of their charters and
+modified governing instruments. For example, blank check companies have amended the definition of business combination, increased redemption
+thresholds and extended the period of time in which it had to consummate a business combination. We cannot assure you that we will not
+seek to amend our amended and restated memorandum and articles of association or governing instruments or extend the time in which we
+have to consummate a business combination through amending our amended and restated memorandum and articles of association, each of which
+will require a special resolution of our shareholders as a matter of Cayman Islands law, meaning a resolution passed by holders of at
+least two thirds of our ordinary shares who are eligible to vote and attend and vote in a general meeting of the company s shareholders.
+
+ 
+
+ 53
+
+ Table of Contents
+
+ 
+
+ 
+
+The
+provisions of our amended and restated memorandum and articles of association that relate to our pre-initial business combination activity
+(and corresponding provisions of the agreement governing the release of funds from our trust account), including an amendment to permit
+us to withdraw funds from the trust account such that the per share amount investors will receive upon any redemption or liquidation
+is substantially reduced or eliminated, may be amended with the approval of holders of at least two-thirds of our ordinary shares who
+attend and vote in a general meeting, which is a lower amendment threshold than that of some other blank check companies. It may be easier
+for us, therefore, to amend our amended and restated memorandum and articles of association and the trust agreement to facilitate the
+completion of an initial business combination that some of our shareholders may not support.
+
+ 
+
+Some
+other blank check companies have a provision in their charter which prohibits the amendment of certain of its provisions, including those
+which relate to a company s pre-initial business combination activity, without approval by a certain percentage of the company s
+shareholders. In those companies, amendment of these provisions requires approval by between 90% and 100% of the company s public
+shareholders. Our amended and restated memorandum and articles of association will provide that any of its provisions, including those
+related to pre-initial business combination activity (including the requirement to deposit proceeds of this offering and the private
+placement of warrants into the trust account and not release such amounts except in specified circumstances, and to provide redemption
+rights to public shareholders as described herein and in our amended and restated memorandum and articles of association or an amendment
+to permit us to withdraw funds from the trust account such that the per share amount investors will receive upon any redemption or liquidation
+is substantially reduced or eliminated), may be amended if approved by holders of at least two-thirds of our ordinary shares who attend
+and vote in a general meeting, and corresponding provisions of the trust agreement governing the release of funds from our trust account
+may be amended if approved by holders of 65% of our ordinary shares. We may not issue additional securities that can vote on amendments
+to our amended and restated memorandum and articles of association. Our sponsor, which will beneficially own approximately 21.88% of
+our ordinary shares upon the closing of this offering (assuming it does not purchase units in this offering and taking into account ownership
+of the private placement units), will participate in any vote to amend our amended and restated memorandum and articles of association
+and/or trust agreement and will have the discretion to vote in any manner it chooses. As a result, we may be able to amend the provisions
+of our amended and restated memorandum and articles of association which govern our pre-business combination behavior more easily than
+some other blank check companies, and this may increase our ability to complete a business combination with which you do not agree. Our
+shareholders may pursue remedies against us for any breach of our amended and restated memorandum and articles of association.
+
+ 
+
+Certain
+agreements related to this offering may be amended without shareholder approval.
+
+ 
+
+Certain
+agreements, including the underwriting agreement relating to this offering, the investment management trust agreement between us, Wilmington
+Trust, National Association and Vstock Transfer LLC, the letter agreement among us and our sponsor, officers, directors and director
+nominees, the registration rights agreement among us and our sponsor and the administrative services agreement between us and our sponsor,
+may be amended without shareholder approval. These agreements contain various provisions that our public shareholders might deem to be
+material. For example, the underwriting agreement related to this offering contains a covenant that the target company that we acquire
+must have a fair market value equal to at least 80% of the balance in the trust account at the time of signing the definitive agreement
+for the transaction with such target business (excluding the deferred underwriting commissions and taxes payable on the income earned
+on the trust account) so long as we obtain and maintain a listing for our securities on the NASDAQ. While we do not expect our board
+to approve any amendment to any of these agreements prior to our initial business combination, it may be possible that our board, in
+exercising its business judgment and subject to its fiduciary duties, chooses to approve one or more amendments to any such agreement
+in connection with the consummation of our initial business combination. Any such amendment may have an adverse effect on the value of
+an investment in our securities.
+
+ 
+
+ 54
+
+ Table of Contents
+
+ 
+
+ 
+
+We
+may be unable to obtain additional financing to complete our initial business combination or to fund the operations and growth of a target
+business, which could compel us to restructure or abandon a particular business combination.
+
+ 
+
+Although
+we believe that the net proceeds of this offering and the sale of the private placement units will be sufficient to allow us to complete
+our initial business combination, because we have not yet identified any prospective target business we cannot ascertain the capital
+requirements for any particular transaction. If the net proceeds of this offering and the sale of the private placement units prove to
+be insufficient, either because of the size of our initial business combination, the depletion of the available net proceeds in search
+of a target business, the obligation to redeem for cash a significant number of shares from shareholders who elect redemption in connection
+with our initial business combination or the terms of negotiated transactions to purchase shares in connection with our initial business
+combination, we may be required to seek additional financing or to abandon the proposed business combination. We cannot assure you that
+such financing will be available on acceptable terms, if at all. To the extent that additional financing proves to be unavailable when
+needed to complete our initial business combination, we would be compelled to either restructure the transaction or abandon that particular
+business combination and seek an alternative target business candidate. In addition, even if we do not need additional financing to complete
+our initial business combination, we may require such financing to fund the operations or growth of the target business. The failure
+to secure additional financing could have a material adverse effect on the continued development or growth of the target business. None
+of our officers, directors or shareholders is required to provide any financing to us in connection with or after our initial business
+combination. If we are unable to complete our initial business combination, our public shareholders may only receive approximately $10.00
+per share on the liquidation of our trust account, and our rights and warrants will expire worthless. In certain circumstances, our public
+shareholders may receive less than $10.00 per share on the redemption of their shares. See "— If third parties bring claims
+against us, the proceeds held in the trust account could be reduced and the per-share redemption amount received by shareholders may
+be less than $10.00 per share" and other risk factors below.
+
+ 
+
+Our
+sponsor paid an aggregate of $25,000, or approximately $0.01 per founder share, and, accordingly, you will experience immediate and substantial
+dilution upon the purchase of our ordinary shares.
+
+ 
+
+The
+difference between the public offering price per share (allocating all of the unit purchase price to the ordinary shares, including the
+ordinary shares underlying the rights included in the units, and none to the warrants included in the units) and the pro forma net tangible
+book value per ordinary share after this offering constitutes the dilution to you and the other investors in this offering. Our sponsor
+acquired the founder shares at a nominal price, significantly contributing to this dilution. Upon the closing of this offering, and assuming
+no value is ascribed to the warrants included in the units, you and the other public shareholders will incur an immediate and substantial
+dilution of approximately 105.74% (or decrease $9.61 per share, assuming no exercise of the underwriters over-allotment option),
+the difference between the pro forma net tangible book value per share of $0.52 and the initial offering price of $9.09 per unit.
+
+ 
+
+The
+value of the founder shares following completion of our initial business combination is likely to be substantially higher than the nominal
+price paid for them, even if the trading price of our ordinary at such time is substantially less than $10.00 per share.
+
+ 
+
+Upon
+the closing of this offering, our sponsor will have invested in us an aggregate of $3,025,000, comprised of the $25,000 purchase price
+for the founder shares and the $3,000,000 purchase price for the private placement units. Assuming a trading price of $10.00 per share
+upon consummation of our initial business combination, the 3,025,000 founder shares (inclusive of the ordinary shares contained in the
+private placement units) would have an aggregate implied value of $30,250,000. Even if the trading price of our ordinary shares were
+as low as $1.00 per share, and the private placement warrants are worthless, the value of the founder shares would be equal to the sponsor s
+initial investment in us. As a result, our sponsor is likely to be able to make a substantial profit on its investment in us at a time
+when our public shares have lost significant value. Accordingly, our sponsor and management team may be more willing to pursue a business
+combination with a riskier or less-established target business than would be the case if our sponsor had paid the same per share price
+for the founder shares as our public shareholders paid for their public shares.
+
+ 
+
+We
+may amend the terms of the warrants in a manner that may be adverse to holders of public warrants with the approval by the holders of
+a majority of the then issued and outstanding warrants.
+
+ 
+
+Our
+warrants will be issued in registered form under a warrant agreement between Vstock Transfer LLC, as warrant agent, and us. The warrant
+agreement provides that the terms of the warrants may be amended without the consent of any holder to cure any ambiguity or correct any
+defective provision, but requires the approval by the holders of a majority of the then issued and outstanding warrants (including private
+warrants) to make any change that adversely affects the interests of the registered holders of warrants. Accordingly, we may amend the
+terms of the warrants in a manner adverse to a holder if holders of a majority of the then issued and outstanding warrants (including
+private warrants) approve of such amendment. Although our ability to amend the terms of the public warrants with the consent of a majority
+of the then issued and outstanding warrants is unlimited, examples of such amendments could be amendments to, among other things, increase
+the exercise price of the warrants, shorten the exercise period or decrease the number of ordinary shares purchasable upon exercise of
+a warrant.
+
+ 
+
+ 55
+
+ Table of Contents
+
+ 
+
+ 
+
+Our
+warrant agreement and rights agreement with our transfer agent will designate the courts of the State of New York or the United States
+District Court for the Southern District of New York as the sole and exclusive forum for certain types of actions and proceedings that
+may be initiated by holders of our warrants, which could limit the ability of warrant holders or rights holders to obtain a favorable
+judicial forum for disputes with our company.
+
+ 
+
+Our
+warrant agreement and rights agreement with our transfer agent, which govern the terms of the warrants and rights, respectively, will
+provide that, subject to applicable law, (i) any action, proceeding or claim against us or the warrant agent arising out of or relating
+in any way to the warrant agreement shall be brought and enforced in the courts of the State of New York or the United States District
+Court for the Southern District of New York, and (ii) that we and the warrant agent and rights agent irrevocably submit to such
+jurisdiction, which jurisdiction shall be the exclusive forum for any such action, proceeding or claim. We and the warrant agent and
+rights agent will waive any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum.
+
+ 
+
+Notwithstanding
+the foregoing, this exclusive forum provision shall not apply to suits brought to enforce a duty or liability created by the Exchange
+Act, any other claim for which the federal courts have exclusive jurisdiction or any complaint asserting a cause of action arising under
+the Securities Act against us or any of our directors, officers, other employees or agents. Section 27 of the Exchange Act creates
+exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and
+regulations thereunder. In addition, shareholders cannot waive compliance with the federal securities laws and the rules and regulations
+thereunder.
+
+ 
+
+Notwithstanding
+the foregoing limitations on venue, such provisions are not applicable with respect to claims under the United States Securities
+Act or Exchange Act. With respect to other types of claims these choice-of-forum provisions may limit a warrant holder s or right s
+holder s ability to bring a claim in a judicial forum that it finds favorable for disputes with our company, which may discourage
+such lawsuits. Alternatively, if a court were to find this provision of our warrant agreement inapplicable or unenforceable with respect
+to one or more of the specified types of actions or proceedings, we may incur additional costs associated with resolving such matters
+in other jurisdictions, which could materially and adversely affect our business, financial condition and results of operations and result
+in a diversion of the time and resources of our management and board of directors.
+
+ 
+
+We
+may amend the terms of the rights in a manner that may be adverse to holders of public rights with the approval by the holders of a majority
+of the then issued and outstanding rights.
+
+ 
+
+Our
+rights will be issued in registered form under a rights agreement between Vstock Transfer LLC, as rights agent, and us. The rights agreement
+provides that the terms of the rights may be amended without the consent of any holder to cure any ambiguity or correct any defective
+provision, but requires the approval by the holders of a majority of the then issued and outstanding rights (including private rights)
+to make any change that adversely affects the interests of the registered holders of rights. Accordingly, we may amend the terms of the
+rights in a manner adverse to a holder if holders of a majority of the then issued and outstanding rights (including private rights)
+approve of such amendment.
+
+ 
+
+We
+may redeem your unexpired warrants prior to their exercise at a time that is disadvantageous to you, thereby making your warrants worthless.
+
+ 
+
+We
+have the ability to redeem outstanding warrants at any time after they become exercisable and prior to their expiration, at a price of
+$0.01 per warrant, provided that the last reported sales price of our ordinary shares equal or exceed $18.00 per share (as adjusted for
+share splits, share capitalizations, rights issuances, subdivisions, reorganizations, recapitalizations and the like) for any 20 trading
+days within a 30 trading-day period ending on the third trading day prior to the date we send the notice of redemption to the warrant
+holders. If and when the warrants become redeemable by us, we may not exercise our redemption right if the issuance of shares upon exercise
+of the warrants is not exempt from registration or qualification under applicable state blue sky laws or we are unable to effect such
+registration or qualification. We will use our best efforts to register or qualify such shares under the blue sky laws of the state of
+residence in those states in which the warrants were offered by us in this offering. Redemption of the outstanding warrants could force
+you (i) to exercise your warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so,
+(ii) to sell your warrants at the then-current market price when you might otherwise wish to hold your warrants or (iii) to
+accept the nominal redemption price which, at the time the outstanding warrants are called for redemption, is likely to be substantially
+less than the market value of your warrants.
+
+ 
+
+ 56
+
+ Table of Contents
+
+ 
+
+ 
+
+Our
+management s ability to require holders of our warrants to exercise such warrants on a cashless basis will cause holders to receive
+fewer ordinary shares upon their exercise of the warrants than they would have received had they been able to exercise their warrants
+for cash.
+
+ 
+
+If
+we call our public warrants for redemption after the redemption criteria described elsewhere in this prospectus have been satisfied,
+our management will have the option to require any holder that wishes to exercise his warrant (including any warrants held by our sponsor,
+officers or directors, other purchasers of our founders units, or their permitted transferees) to do so on a "cashless basis."
+If our management chooses to require holders to exercise their warrants on a cashless basis, the number of ordinary shares received by
+a holder upon exercise will be fewer than it would have been had such holder exercised his warrant for cash. This will have the effect
+of reducing the potential "upside" of the holder s investment in our company.
+
+ 
+
+Our
+rights, warrants and founder shares may have an adverse effect on the market price of our ordinary shares and make it more difficult
+to effectuate our initial business combination.
+
+ 
+
+ We will be issuing rights to acquire 10,000,000
+of our ordinary shares (or up to 11,500,000 ordinary shares if the underwriters over-allotment option is exercised in full) and
+warrants to purchase 10,000,000 of our ordinary shares (or up to 11,500,000 ordinary shares if the underwriters over-allotment
+option is exercised in full), as part of the units offered by this prospectus and, simultaneously with the closing of this offering,
+an aggregate of 300,000 (or 330,000 if the underwriters over-allotment option is exercised in full) private placement units in
+a private placement, each unit consisting of one private placement share, one private placement right, granting the holder thereof the
+right to receive one-tenth (1/10) of an ordinary share upon the consummation of an initial business combination, and one private placement
+warrant. In each case, the warrants are exercisable to purchase one ordinary share at a price of $11.50 per share, subject to adjustment
+as provided herein. Prior to this offering, our sponsor purchased an aggregate of 2,875,000 founder shares in a private placement. In
+addition, if our sponsor makes any working capital loans, up to $1,500,000 of such loans may be converted into units, at the price of
+$10.00 per unit (which, for example, would result in the holders being issued 165,000 ordinary shares if $1,500,000 of notes were so
+converted (including 15,000 shares upon the closing of our initial business combination in respect of 150,000 rights included in such
+units), as well as 150,000 warrants to purchase 150,000 shares) at the option of the lender. Such units would be identical to the private
+placement units. To the extent we issue ordinary shares to effectuate a business transaction, the potential for the issuance of a substantial
+number of additional ordinary shares upon exercise of these warrants or conversion rights could make us a less attractive acquisition
+vehicle to a target business. Any such issuance will increase the number of issued and outstanding ordinary shares and reduce the value
+of the ordinary shares issued to complete the business transaction. Therefore, our rights, warrants and founder shares may make it more
+difficult to effectuate a business combination or increase the cost of acquiring the target business. 
+
+ 
+
+The
+private placement units are identical to the units sold in this offering except that, so long as the private placement warrants are held
+by our sponsor, or its permitted transferees, they (including the ordinary shares issuable upon exercise of these warrants) may not,
+subject to certain limited exceptions, be transferred, assigned or sold by the sponsor until 30 days after the completion of our initial
+business combination.
+
+ 
+
+The
+determination of the offering price of our units and the size of this offering is more arbitrary than the pricing of securities and size
+of an offering of an operating company in a particular industry. You may have less assurance, therefore, that the offering price of our
+units properly reflects the value of such units than you would have in a typical offering of an operating company.
+
+ 
+
+Prior
+to this offering there has been no public market for any of our securities. The public offering price of the units and the terms of the
+warrants and rights were negotiated between us and the underwriters. In determining the size of this offering, management held customary
+organizational meetings with representatives of the underwriters, both prior to our inception and thereafter, with respect to the state
+of capital markets, generally, and the amount the underwriters believed they reasonably could raise on our behalf. Factors considered
+in determining the size of this offering, prices and terms of the units, including the ordinary shares, rights and warrants underlying
+the units, include:
+
+ 
+
+ the
+ history and prospects of companies whose principal business is the acquisition of other companies;
+
+ 
+
+ prior
+ offerings of those companies;
+
+ 
+
+ 57
+
+ Table of Contents
+
+ 
+
+ 
+
+ our
+ prospects for acquiring an operating business at attractive values;
+
+ 
+
+ a
+ review of debt to equity ratios in leveraged transactions;
+
+ 
+
+ our
+ capital structure;
+
+ 
+
+ an
+ assessment of our management and their experience in identifying operating companies;
+
+ 
+
+ general
+ conditions of the securities markets at the time of this offering; and
+
+ 
+
+ other
+ factors as were deemed relevant.
+
+ 
+
+Although
+these factors were considered, the determination of our offering price is more arbitrary than the pricing of securities of an operating
+company in a particular industry since we have no historical operations or financial results.
+
+ 
+
+There
+is currently no market for our securities and a market for our securities may not develop, which would adversely affect the liquidity
+and price of our securities.
+
+ 
+
+There
+is currently no market for our securities. Shareholders therefore have no access to information about prior market history on which to
+base their investment decision. Following this offering, the price of our securities may vary significantly due to one or more potential
+business combinations and general market or economic conditions. Furthermore, an active trading market for our securities may never develop
+or, if developed, it may not be sustained. You may be unable to sell your securities unless a market can be established and sustained.
+
+ 
+
+Because
+we must furnish our shareholders with target business financial statements, we may lose the ability to complete an otherwise advantageous
+initial business combination with some prospective target businesses.
+
+ 
+
+The
+federal proxy rules require that a proxy statement with respect to a vote on a business combination meeting certain financial significance
+tests include historical and/or pro forma financial statement disclosure in periodic reports. We will include the same financial statement
+disclosure in connection with our tender offer documents, whether or not they are required under the tender offer rules. These financial
+statements may be required to be prepared in accordance with, or be reconciled to, accounting principles generally accepted in the United
+States of America, or U.S. GAAP, or international financing reporting standards as issued by the International Accounting Standards Board,
+or IFRS, depending on the circumstances and the historical financial statements may be required to be audited in accordance with the
+standards of the Public Company Accounting Oversight Board (United States), or PCAOB. These financial statement requirements may limit
+the pool of potential target businesses we may acquire because some targets may be unable to provide such statements in time for us to
+disclose such statements in accordance with federal proxy rules and complete our initial business combination within the prescribed
+time frame.
+
+ 
+
+We
+are an emerging growth company within the meaning of the Securities Act, and if we take advantage of certain exemptions from disclosure
+requirements available to emerging growth companies, this could make our securities less attractive to investors and may make it more
+difficult to compare our performance with other public companies.
+
+ 
+
+We
+are an "emerging growth company" within the meaning of the Securities Act, as modified by the JOBS Act, and we may take advantage
+of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth
+companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of
+the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements,
+and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any
+golden parachute payments not previously approved. As a result, our shareholders may not have access to certain information they may
+deem important. We could be an emerging growth company for up to five years, although circumstances could cause us to lose that status
+earlier, including if the market value of our ordinary shares held by non-affiliates exceeds $700 million as of any June 30 before
+that time, in which case we would no longer be an emerging growth company as of the following December 31. We cannot predict whether
+investors will find our securities less attractive because we will rely on these exemptions. If some investors find our securities less
+attractive as a result of our reliance on these exemptions, the trading prices of our securities may be lower than they otherwise would
+be, there may be a less active trading market for our securities and the trading prices of our securities may be more volatile.
+
+ 
+
+ 58
+
+ Table of Contents
+
+ 
+
+ 
+
+Further,
+Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial
+accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective
+or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting
+standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements
+that apply to non-emerging growth companies but any such an election to opt out is irrevocable. We have elected not to opt out of such
+extended transition period which means that when a standard is issued or revised and it has different application dates for public or
+private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new
+or revised standard. This may make comparison of our financial statements with another public company which is neither an emerging growth
+company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of
+the potential differences in accountant standards used.
+
+ 
+
+Compliance
+obligations under the Sarbanes-Oxley Act may make it more difficult for us to effectuate our initial business combination, require substantial
+financial and management resources, and increase the time and costs of completing an acquisition.
+
+ 
+
+ Section 404
+of the Sarbanes-Oxley Act requires that we evaluate and report on our system of internal controls beginning with our Annual Report on
+Form 10-K for the year ending December 31, 2023. Only in the event we are deemed to be a large accelerated filer or an accelerated
+filer will we be required to comply with the independent registered public accounting firm attestation requirement on our internal control
+over financial reporting. Further, for as long as we remain an emerging growth company, we will not be required to comply with the independent
+registered public accounting firm attestation requirement on our internal control over financial reporting. The fact that we are a blank
+check company makes compliance with the requirements of the Sarbanes-Oxley Act particularly burdensome on us as compared to other public
+companies because a target company with which we seek to complete our initial business combination may not be in compliance with the
+provisions of the Sarbanes-Oxley Act regarding adequacy of its internal controls. The development of the internal control of any such
+entity to achieve compliance with the Sarbanes-Oxley Act may increase the time and costs necessary to complete any such acquisition. 
+
+ 
+
+Because
+we are incorporated under the laws of the Cayman Islands, you may face difficulties in protecting your interests, and your ability to
+protect your rights through the U.S. Federal courts may be limited.
+
+ 
+
+We
+are an exempted company incorporated under the laws of the Cayman Islands. As a result, it may be difficult for investors to effect service
+of process within the United States upon our directors or officers, or enforce judgments obtained in the United States courts against
+our directors or officers.
+
+ 
+
+Our
+corporate affairs are governed by our amended and restated memorandum and articles of association, the Companies Act (as the same may
+be supplemented or amended from time to time) and the common law of the Cayman Islands. The rights of shareholders to take action against
+the directors, actions by minority shareholders and the fiduciary responsibilities of our directors to us under Cayman Islands law are
+to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands is derived in part from comparatively
+limited judicial precedent in the Cayman Islands as well as from English common law, the decisions of whose courts are of persuasive
+authority, but are not binding on a court in the Cayman Islands. The rights of our shareholders and the fiduciary responsibilities of
+our directors under Cayman Islands law are different from what they would be under statutes or judicial precedent in some jurisdictions
+in the United States. In particular, the Cayman Islands has a different body of securities laws as compared to the United States, and
+certain states, such as Delaware, may have more fully developed and judicially interpreted bodies of corporate law. In addition, Cayman
+Islands companies may not have standing to initiate a shareholders derivative action in a Federal court of the United States.
+
+ 
+
+ 59
+
+ Table of Contents
+
+ 
+
+ 
+
+We
+have been advised by our Cayman Islands legal counsel that the courts of the Cayman Islands are unlikely (i) to recognize or enforce
+against us judgments of courts of the United States predicated upon the civil liability provisions of the federal securities laws of
+the United States or any state; and (ii) in original actions brought in the Cayman Islands, to impose liabilities against us predicated
+upon the civil liability provisions of the federal securities laws of the United States or any state, so far as the liabilities imposed
+by those provisions are penal in nature. In those circumstances, although there is no statutory enforcement in the Cayman Islands of
+judgments obtained in the United States, the courts of the Cayman Islands will recognize and enforce a foreign money judgment of a foreign
+court of competent jurisdiction without retrial on the merits based on the principle that a judgment of a competent foreign court imposes
+upon the judgment debtor an obligation to pay the sum for which judgment has been given provided certain conditions are met. For a foreign
+judgment to be enforced in the Cayman Islands, such judgment must be final and conclusive and for a liquidated sum, and must not be in
+respect of taxes or a fine or penalty, inconsistent with a Cayman Islands judgment in respect of the same matter, impeachable on the
+grounds of fraud or obtained in a manner, or be of a kind the enforcement of which is, contrary to natural justice or the public policy
+of the Cayman Islands (awards of punitive or multiple damages may well be held to be contrary to public policy). A Cayman Islands Court
+may stay enforcement proceedings if concurrent proceedings are being brought elsewhere.
+
+ 
+
+As
+a result of all of the above, public shareholders may have more difficulty in protecting their interests in the face of actions taken
+by management, members of the Board of Directors or controlling shareholders than they would as public shareholders of a United States
+company.
+
+ 
+
+Provisions
+in our amended and restated memorandum and articles of association may inhibit a takeover of us, which could limit the price investors
+might be willing to pay in the future for our ordinary shares and could entrench management.
+
+ 
+
+Our
+amended and restated memorandum and articles of association will contain provisions that may discourage unsolicited takeover proposals
+that shareholders may consider to be in their best interests. These provisions include two-year director terms which may make more difficult
+the removal of management and may discourage transactions that otherwise could involve payment of a premium over prevailing market prices
+for our securities.
+
+ 
+
+After
+our initial business combination, it is possible that a majority of our directors and officers will live outside the United States and
+all of our assets will be located outside the United States; therefore investors may not be able to enforce federal securities laws or
+their other legal rights.
+
+ 
+
+It
+is possible that after our initial business combination, a majority of our directors and officers will reside outside of the United States
+and all of our assets will be located outside of the United States. As a result, it may be difficult, or in some cases not possible,
+for investors in the United States to enforce their legal rights, to effect service of process upon all of our directors or officers
+or to enforce judgments of United States courts predicated upon civil liabilities and criminal penalties on our directors and officers
+under United States laws.
+
+ 
+
+In
+particular, investors should be aware that there is uncertainty as to whether the courts of the Cayman Islands or any other applicable
+jurisdictions would recognize and enforce judgments of U.S. courts obtained against us or our directors or officers predicated upon the
+civil liability provisions of the securities laws of the United States or any state in the United States or entertain original actions
+brought in the Cayman Islands or any other applicable jurisdiction s courts against us or our directors or officers predicated
+upon the securities laws of the United States or any state in the United States.
+
+ 
+
+ 60
+
+ Table of Contents
+
+ 
+
+ 
+
+Risks
+Associated with Acquiring and Operating a Business Outside of the United States
+
+ 
+
+If
+we effect our initial business combination with a company located outside of the United States, we would be subject to a variety of additional
+risks that may negatively impact our operations.
+
+ 
+
+ If we effect our initial business combination
+with a company located outside of the United States (although we will not consider or undertake a business combination with any entity
+or business, that is based in the People s Republic of China, including Hong Kong and Macau, or that has its principal or a majority
+of its business operations in such jurisdictions, we would be subject to any special considerations or risks associated with companies
+operating in the target business home jurisdiction, including any of the following: 
+
+ 
+
+ rules and
+ regulations or currency redemption or corporate withholding taxes on individuals;
+
+ 
+
+ laws
+ governing the manner in which future business combinations may be effected;
+
+ 
+
+ tariffs
+ and trade barriers;
+
+ 
+
+ regulations
+ related to customs and import/export matters;
+
+ 
+
+ longer
+ payment cycles;
+
+ 
+
+ tax
+ issues, such as tax law changes and variations in tax laws as compared to the United States;
+
+ 
+
+ currency
+ fluctuations and exchange controls;
+
+ 
+
+ rates
+ of inflation;
+
+ 
+
+ challenges
+ in collecting accounts receivable;
+
+ 
+
+ cultural
+ and language differences;
+
+ 
+
+ employment
+ regulations;
+
+ 
+
+ crime,
+ strikes, riots, civil disturbances, terrorist attacks and wars; and
+
+ 
+
+ deterioration
+ of political relations with the United States which could result in any number of difficulties,
+ both normal course such as above or extraordinary such as sanctions being imposed. We may
+ not be able to adequately address these additional risks. If we were unable to do so, our
+ operations might suffer.
+
+ 
+
+If
+our management following our initial business combination is unfamiliar with United States securities laws, they may have to expend time
+and resources becoming familiar with such laws, which could lead to various regulatory issues.
+
+ 
+
+Following
+our initial business combination, any or all of our management could resign from their positions as officers of the Company, and the
+management of the target business at the time of the business combination will remain in place. Management of the target business may
+not be familiar with United States securities laws. If new management is unfamiliar with United States securities laws, they may have
+to expend time and resources becoming familiar with such laws. This could be expensive and time-consuming and could lead to various regulatory
+issues which may adversely affect our operations.
+
+ 
+
+ 61
+
+ Table of Contents
+
+ 
+
+ 
+
+If
+we effect a business combination with a company located outside of the United States, the laws applicable to such company will likely
+govern all of our material agreements and we may not be able to enforce our legal rights.
+
+ 
+
+If
+we effect a business combination with a company located outside of the United States, the laws of the country in which such company operates
+will govern almost all of the material agreements relating to its operations. We cannot assure you that the target business will be able
+to enforce any of its material agreements or that remedies will be available in this new jurisdiction. The system of laws and the enforcement
+of existing laws in such jurisdiction may not be as certain in implementation and interpretation as in the United States. The inability
+to enforce or obtain a remedy under any of our future agreements could result in a significant loss of business, business opportunities
+or capital. Additionally, if we acquire a company located outside of the United States, it is likely that substantially all of our assets
+would be located outside of the United States and some of our officers and directors might reside outside of the United States. As a
+result, it may not be possible for investors in the United States to enforce their legal rights, to effect service of process upon
+our directors or officers or to enforce judgments of United States courts predicated upon civil liabilities and criminal penalties of
+our directors and officers under Federal securities laws.
+
+ 
+
+Because
+of the costs and difficulties inherent in managing cross-border business operations after we acquire it, our results of operations may
+be negatively impacted following a business combination.
+
+ 
+
+Managing
+a business, operations, personnel or assets in another country is challenging and costly. Management of the target business that we may
+hire (whether based abroad or in the U.S.) may be inexperienced in cross-border business practices and unaware of significant differences
+in accounting rules, legal regimes and labor practices. Even with a seasoned and experienced management team, the costs and difficulties
+inherent in managing cross-border business operations, personnel and assets can be significant (and much higher than in a purely domestic
+business) and may negatively impact our financial and operational performance.
+
+ 
+
+Many
+countries, and especially those in emerging markets, have difficult and unpredictable legal systems and underdeveloped laws and regulations
+that are unclear and subject to corruption and inexperience, which may adversely impact our results of operations and financial condition.
+
+ 
+
+Our
+ability to seek and enforce legal protections, including with respect to intellectual property and other property rights, or to defend
+ourselves with regard to legal actions taken against us in a given country, may be difficult or impossible, which could adversely impact
+our operations, assets or financial condition.
+
+ 
+
+Rules and
+regulations in many countries, including some of the emerging markets within the regions we will initially focus, are often ambiguous
+or open to differing interpretation by responsible individuals and agencies at the municipal, state, regional and federal levels. The
+attitudes and actions of such individuals and agencies are often difficult to predict and inconsistent.
+
+ 
+
+Delay
+with respect to the enforcement of particular rules and regulations, including those relating to customs, tax, environmental and
+labor, could cause serious disruption to operations abroad and negatively impact our results.
+
+ 
+
+After
+our initial business combination, substantially all of our assets may be located in a foreign country and substantially all of our revenue
+may be derived from our operations in such country. Accordingly, our results of operations and prospects will be subject, to a significant
+extent, to the economic, political and legal policies, developments and conditions in the country in which we operate.
+
+ 
+
+The
+economic, political and social conditions, as well as government policies, of the country in which our operations are located could affect
+our business. The economies in developing markets we will initially focus on differ from the economies of most developed countries in
+many respects. Such economic growth has been uneven, both geographically and among various sectors of the economy and such growth may
+not be sustained in the future. If in the future such country s economy experiences a downturn or grows at a slower rate than expected,
+there may be less demand for spending in certain industries. A decrease in demand for spending in certain industries could materially
+and adversely affect our ability to find an attractive target business with which to consummate our initial business combination and
+if we effect our initial business combination, the ability of that target business to become profitable.
+
+ 
+
+ 62
+
+ Table of Contents
+
+ 
+
+ 
+
+Exchange
+rate fluctuations and currency policies may cause a target business ability to succeed in the international markets to be diminished.
+
+ 
+
+In
+the event we acquire a non-U.S. target, all revenues and income would likely be received in a foreign currency, the dollar equivalent
+of our net assets and distributions, if any, could be adversely affected by reductions in the value of the local currency. The value
+of the currencies in our target regions fluctuate and are affected by, among other things, changes in political and economic conditions.
+Any change in the relative value of such currency against our reporting currency may affect the attractiveness of any target business
+or, following consummation of our initial business combination, our financial condition and results of operations. Additionally, if a
+currency appreciates in value against the dollar prior to the consummation of our initial business combination, the cost of a target
+business as measured in dollars will increase, which may make it less likely that we are able to consummate such transaction.
+
+ 
+
+Because
+our business objective includes the possibility of acquiring one or more operating businesses with primary operations in emerging markets
+we will focus on, changes in the exchange rate between the U.S. dollar and the currency of any relevant jurisdiction may affect our ability
+to achieve such objective. For instance, the exchange rates between the Turkish lira or the Indian rupee and the U.S. dollar has changed
+substantially in the last two decades and may fluctuate substantially in the future. If the U.S. dollar declines in value against the
+relevant currency, any business combination will be more expensive and therefore more difficult to complete. Furthermore, we may incur
+costs in connection with conversions between U.S. dollars and the relevant currency, which may make it more difficult to consummate a
+business combination.
+
+ 
+
+Because
+foreign law could govern almost all of our material agreements, we may not be able to enforce our rights within such jurisdiction or
+elsewhere, which could result in a significant loss of business, business opportunities or capital.
+
+ 
+
+Foreign
+law could govern almost all of our material agreements. The target business may not be able to enforce any of its material agreements
+or that remedies will be available outside of such foreign jurisdiction s legal system. The system of laws and the enforcement
+of existing laws and contracts in such jurisdiction may not be as certain in implementation and interpretation as in the United States.
+Judiciaries in such jurisdiction may also be relatively inexperienced in enforcing corporate and commercial law, leading to a higher
+than usual degree of uncertainty as to the outcome of any litigation. As a result, the inability to enforce or obtain a remedy under
+any of our future agreements could result in a significant loss of business and business opportunities.
+
+ 
+
+Corporate
+governance standards in foreign countries may not be as strict or developed as in the United States and such weakness may hide issues
+and operational practices that are detrimental to a target business.
+
+ 
+
+General
+corporate governance standards in some countries are weak in that they do not prevent business practices that cause unfavorable related
+party transactions, over-leveraging, improper accounting, family company interconnectivity and poor management. Local laws often do not
+go far to prevent improper business practices. Therefore, shareholders may not be treated impartially and equally as a result of poor
+management practices, asset shifting, conglomerate structures that result in preferential treatment to some parts of the overall company,
+and cronyism. The lack of transparency and ambiguity in the regulatory process also may result in inadequate credit evaluation and weakness
+that may precipitate or encourage financial crisis. In our evaluation of a business combination we will have to evaluate the corporate
+governance of a target and the business environment, and in accordance with United States laws for reporting companies take steps to
+implement practices that will cause compliance with all applicable rules and accounting practices. Notwithstanding these intended
+efforts, there may be endemic practices and local laws that could add risk to an investment we ultimately make and that result in an
+adverse effect on our operations and financial results.
+
+ 
+
+Companies
+in foreign countries may be subject to accounting, auditing, regulatory and financial standards and requirements that differ, in some
+cases significantly, from those applicable to public companies in the United States, which may make it more difficult or complex
+to consummate a business combination. In particular, the assets and profits appearing on the financial statements of a foreign company
+may not reflect its financial position or results of operations in the way they would be reflected had such financial statements been
+prepared in accordance with U.S. GAAP and there may be substantially less publicly available information about companies in certain
+jurisdictions than there is about comparable United States companies. Moreover, foreign companies may not be subject to the same degree
+of regulation as are United States companies with respect to such matters as insider trading rules, tender offer regulation, shareholder
+proxy requirements and the timely disclosure of information.
+
+ 
+
+Legal
+principles relating to corporate affairs and the validity of corporate procedures, directors fiduciary duties and liabilities
+and shareholders rights for foreign corporations may differ from those that may apply in the U.S., which may make the consummation
+of a business combination with a foreign company more difficult. We therefore may have more difficulty in achieving our business objective.
+
+ 
+
+ 63
+
+ Table of Contents
+
+ 
+
+ 
+
+Because
+a foreign judiciary may determine the scope and enforcement of almost all of our target business material agreements under the
+law of such foreign jurisdiction, we may be unable to enforce our rights inside and outside of such jurisdiction.
+
+ 
+
+The
+law of a foreign jurisdiction, may govern almost all of our target business material agreements, some of which may be with governmental
+agencies in such jurisdiction. We cannot assure you that the target business or businesses will be able to enforce any of their material
+agreements or that remedies will be available outside of such jurisdiction. The inability to enforce or obtain a remedy under any of
+our future agreements may have a material adverse impact on our future operations.
+
+ 
+
+A slowdown
+in economic growth in the markets that our business target operates in may adversely affect our business, financial condition, results
+of operations, the value of its equity shares and the trading price of our shares following our business combination.
+
+ 
+
+Following
+the business combination, our results of operations and financial condition may be dependent on, and may be adversely affected by, conditions
+in financial markets in the global economy, and, particularly in the markets where the business operates. The specific economy could
+be adversely affected by various factors such as political or regulatory action, including adverse changes in liberalization policies,
+business corruption, social disturbances, terrorist attacks and other acts of violence or war, natural calamities, interest rates, inflation,
+commodity and energy prices and various other factors which may adversely affect our business, financial condition, results of operations,
+value of our equity shares and the trading price of our shares following the business combination.
+
+ 
+
+Regional
+hostilities, terrorist attacks, communal disturbances, civil unrest and other acts of violence or war may result in a loss of investor
+confidence and a decline in the value of our equity shares and trading price of our shares following our business combination.
+
+ 
+
+Terrorist
+attacks, civil unrest and other acts of violence or war may negatively affect the markets in which we may operates our business following
+our business combination and also adversely affect the worldwide financial markets. In addition, the countries we will focus on, have
+from time to time experienced instances of civil unrest and hostilities among or between neighboring countries. Any such hostilities
+and tensions may result in investor concern about stability in the region, which may adversely affect the value of our equity shares
+and the trading price of our shares following our business combination. Events of this nature in the future, as well as social and civil
+unrest, could influence the economy in which our business target operates, and could have an adverse effect on our business, including
+the value of equity shares and the trading price of our shares following our business combination.
+
+ 
+
+The
+occurrence of natural disasters may adversely affect our business, financial condition and results of operations following our business
+combination.
+
+ 
+
+The
+occurrence of natural disasters, including hurricanes, floods, earthquakes, tornadoes, fires and pandemic disease may adversely affect
+our business, financial condition or results of operations following our business combination. The potential impact of a natural disaster
+on our results of operations and financial position is speculative, and would depend on numerous factors. The extent and severity of
+these natural disasters determines their effect on a given economy. Although the long term effect of diseases such as the H5N1 "avian
+flu," or H1N1, the swine flu, cannot currently be predicted, previous occurrences of avian flu and swine flu had an adverse effect
+on the economies of those countries in which they were most prevalent. An outbreak of a communicable disease in our market could adversely
+affect our business, financial condition and results of operations following our business combination. We cannot assure you that natural
+disasters will not occur in the future or that its business, financial condition and results of operations will not be adversely affected.
+
+ 
+
+ 64
+
+ Table of Contents
+
+ 
+
+ 
+
+Any
+downgrade of credit ratings of the country in which the company we acquire does business may adversely affect our ability to raise debt
+financing following our business combination.
+
+ 
+
+No
+assurance can be given that any rating organization will not downgrade the credit ratings of the sovereign foreign currency long-term
+debt of the country in which our business target operates, which reflect an assessment of the overall financial capacity of the government
+of such country to pay its obligations and its ability to meet its financial commitments as they become due. Any downgrade could cause
+interest rates and borrowing costs to rise, which may negatively impact both the perception of credit risk associated with our future
+variable rate debt and our ability to access the debt markets on favorable terms in the future. This could have an adverse effect on
+our financial condition following our business combination.
+
+ 
+
+Returns
+on investment in foreign companies may be decreased by withholding and other taxes.
+
+ 
+
+Our
+investments will incur tax risk unique to investment in developing economies. Income that might otherwise not be subject to withholding
+of local income tax under normal international conventions may be subject to withholding of income tax in a developing economy. Additionally,
+proof of payment of withholding taxes may be required as part of the remittance procedure. Any withholding taxes paid by us on income
+from our investments in such country may or may not be creditable on our income tax returns. We intend to seek to minimize any withholding
+tax or local tax otherwise imposed. However, there is no assurance that the foreign tax authorities will recognize application of such
+treaties to achieve a minimization of such tax. We may also elect to create foreign subsidiaries to effect the business combinations
+to attempt to limit the potential tax consequences of a business combination.
+
+ 
+
+ 65
+
+ Table of Contents
+
+ 
+
+ 
+
+CAUTIONARY
+NOTE REGARDING FORWARD-LOOKING STATEMENTS
+
+ 
+
+Some
+statements contained in this prospectus are forward-looking in nature. Our forward-looking statements include, but are not limited to,
+statements regarding our or our management team s expectations, hopes, beliefs, intentions or strategies regarding the future.
+In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including
+any underlying assumptions, are forward-looking statements. The words "anticipate," "believe," "continue,"
+"could," "estimate," "expect," "intends," "may," "might," "plan,"
+"possible," "potential," "predict," "project," "should," "would"
+and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not
+forward-looking. Forward-looking statements in this prospectus may include, for example, statements about:
+
+ 
+
+ 
+ 
+ 
+ our
+ ability to complete our initial business combination;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ success in retaining or recruiting, or changes required in, our officers, key employees or directors following our initial business
+ combination;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or
+ in approving our initial business combination, as a result of which they would then receive expense reimbursements;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ potential ability to obtain additional financing to complete our initial business combination;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ pool of prospective target businesses;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ ability of our officers and directors to generate a number of potential acquisition opportunities;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ public securities potential liquidity and trading;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ lack of a market for our securities;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ use of proceeds not held in the trust account or available to us from interest income on the trust account balance; or
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ financial performance following this offering.
+
+ 
+ 
+
+The
+forward-looking statements contained in this prospectus are based on our current expectations and beliefs concerning future developments
+and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated.
+These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions
+that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements.
+These risks and uncertainties include, but are not limited to, those factors described under the heading "Risk Factors".
+Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may
+vary in material respects from those projected in these forward-looking statements. We undertake no obligation to update or revise any
+forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable
+securities laws.
+
+ 
+
+ 66
+
+ Table of Contents
+
+ 
+
+ 
+
+USE
+OF PROCEEDS
+
+ 
+
+We
+are offering 10,000,000 units at an offering price of $10.00 per unit. We estimate that the net proceeds of this offering together with
+the funds we will receive from the sale of the private placement units will be used as set forth in the following table.
+
+ 
+
+ 
+ 
+ Without
+ 
+ Over-Allotment 
+ Option 
+ Over-Allotment
+ 
+ Option 
+ Exercised 
+
+ 
+ Gross
+ proceeds 
+ 
+ 
+
+ 
+ Gross
+ proceeds from units offered to public(1) 
+ $100,000,000 
+ $115,000,000 
+
+ 
+ Gross
+ proceeds from private placement units offered in the private placement 
+ 3,000,000 
+ 3,300,000 
+
+ 
+ Total
+ gross proceeds 
+ $103,000,000 
+ $118,300,000 
+
+ 
+ Offering
+ expenses(2) 
+ 
+ 
+
+ 
+ Underwriting
+ commissions (2% of gross proceeds from units offered to public, excluding deferred portion)(3) 
+ $2,000,000 
+ $2,300,000 
+
+ 
+ Legal
+ fees and expenses 
+ 250,000 
+ 250,000 
+
+ 
+ Accounting
+ fees and expenses 
+ 45,000 
+ 45,000 
+
+ 
+ SEC/FINRA
+ Expenses 
+ 12,000 
+ 12,000 
+
+ 
+ NASDAQ
+ listing and filing fees 
+ 50,000 
+ 50,000 
+
+ 
+ Printing
+ and engraving expenses 
+ 30,000 
+ 30,000 
+
+ 
+ Miscellaneous(4) 
+ 113,000 
+ 113,000 
+
+ 
+ Total
+ offering expenses (other than underwriting commissions) 
+ $500,000 
+ $500,000 
+
+ 
+ Proceeds
+ after offering expenses 
+ $100,500,000 
+ $115,500,000 
+
+ 
+ Held
+ in trust account(3) 
+ $100,000,000 
+ $115,000,000 
+
+ 
+ %
+ of public offering size 
+ 100% 
+ 100%
+
+ 
+ Not
+ held in trust account(2) 
+ $500,000 
+ $500,000 
+
+ 
+
+ 
+
+The
+following table shows the use of the approximately $500,000 of net proceeds not held in the trust account.(5)
+
+ 
+
+ 
+ 
+ Amount 
+ %
+ of Total 
+
+ 
+ Legal,
+ accounting, due diligence, travel, and other expenses in connection with any business combination(5) 
+ $125,000 
+ 25.0%
+
+ 
+ Legal
+ and accounting fees related to regulatory reporting obligations 
+ 63,000 
+ 12.6%
+
+ 
+ Payment
+ for office space, administrative and support services 
+ 120,000 
+ 24.0%
+
+ 
+ NASDAQ
+ continued listing fees 
+ 50,000 
+ 10.0%
+
+ 
+ Director
+ and Officer liability insurance premiums 
+ 120,000 
+ 24.0%
+
+ 
+ Other
+ miscellaneous expenses 
+ 22,000 
+ 4.4%
+
+ 
+ Total 
+ $500,000 
+ 100.0%
+
+ 
+
+ 
+
+ 
+
+(1)Includes
+ amounts payable to public shareholders who properly redeem their shares in connection with
+ our successful completion of our initial business combination.
+
+ 
+
+ 67
+
+ Table of Contents
+
+ 
+
+ 
+
+(2)A
+ portion of the offering expenses and post offering expenses have been paid or will be paid
+ from the proceeds of loans from our sponsor of up to $300,000 as described elsewhere in this
+ prospectus. As of December 31, 2021, we had borrowed $300,000 under the promissory note with
+ our sponsor. These loans will be repaid upon completion of this offering out of the $500,000
+ of offering proceeds that has been allocated for the payment of offering expenses (other
+ than underwriting commissions) and amounts not to be held in the trust account, or in the
+ event a business combination is completed from funds not redeemed. In the event that offering
+ expenses are less than as set forth in this table, any such amounts will be used for post-closing
+ working capital expenses. In the event that the offering expenses are more than as set forth
+ in this table, we may fund such excess with funds not held in the trust account, including
+ additional loan amounts from our sponsor.
+
+ 
+
+(3)The
+ underwriters have agreed to defer underwriting commissions equal to 2.5% of the gross proceeds
+ of this offering. Upon completion of our initial business combination, $2,500,000 (or up
+ to $2,875,000 if the underwriters over-allotment option is exercised in full), which
+ constitutes the underwriters deferred commissions will be paid to the underwriters
+ from the funds held in the trust account, and the remaining funds, less amounts released
+ by the trustee to pay redeeming shareholders, will be released to us and can be used to pay
+ all or a portion of the purchase price of the business or businesses with which our initial
+ business combination occurs or for general corporate purposes, including payment of principal
+ or interest on indebtedness incurred in connection with our initial business combination,
+ to fund the purchases of other companies or for working capital. The underwriters will not
+ be entitled to any interest accrued on the deferred underwriting discounts and commissions.
+
+ 
+
+(4)Includes
+ organizational and administrative expenses and may include amounts related to above-listed
+ expenses in the event actual amounts exceed estimates.
+
+ 
+
+ (5) These
+ expenses are estimates for the first 9 months following the closing of this offering only.
+ In the event that we extend the time to consummate our initial business combination, as set
+ forth herein, such expenses may increase. Our actual expenditures for some or all of these
+ items may differ from the estimates set forth herein. For example, we may incur greater legal
+ and accounting expenses than our current estimates in connection with negotiating and structuring
+ a business combination based upon the level of complexity of such business combination. In
+ the event we identify an acquisition target in a specific industry subject to specific regulations,
+ we may incur additional expenses associated with legal due diligence and the engagement of
+ special legal counsel. In addition, our staffing needs may vary and as a result, we may engage
+ a number of consultants to assist with legal and financial due diligence. We do not anticipate
+ any change in our intended use of proceeds, other than fluctuations among the current categories
+ of allocated expenses, which fluctuations, to the extent they exceed current estimates for
+ any specific category of expenses, would not be available for our expenses. Based on current
+ interest rates, we would expect approximately $200,000 to be available to us to pay our tax
+ obligations, if any, from interest earned on the funds held in the trust account over 9 months
+ following the investment of such funds in specified U.S. Government Treasury bills, however,
+ we can provide no assurances regarding this amount. This estimate assumes no exercise of
+ the underwriters overallotment option and an interest rate of 0.2% per annum based
+ upon current yields of securities in which the trust account may be invested. In addition,
+ in order to finance transaction costs in connection with an intended initial business combination,
+ our sponsor or an affiliate of our sponsor or certain of our officers and directors may,
+ but are not obligated to, loan us funds as may be required. If we complete our initial business
+ combination, we would repay such loaned amounts out of the proceeds of the trust account
+ released to us. Otherwise, such loans would be repaid only out of funds held outside the
+ trust account. In the event that our initial business combination does not close, we may
+ use a portion of the working capital held outside the trust account to repay such loaned
+ amounts but no proceeds from our trust account would be used to repay such loaned amounts.
+ Up to $1,500,000 of such loans may be convertible into units at a price of $10.00 per unit
+ (which, for example, would result in the holders being issued 165,000 ordinary shares if
+ $1,500,000 of notes were so converted (including 15,000 shares upon the closing of our initial
+ business combination in respect of 150,000 rights included in such units), as well as 150,000
+ warrants to purchase 150,000 shares) at the option of the lender. The units would be identical
+ to the private placement units issued to our sponsor. The terms of such loans by our sponsor,
+ affiliate of our sponsor, or certain of our officers and directors, if any, have not been
+ determined and no written agreements exist with respect to such loans. We do not expect to
+ seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not
+ believe third parties will be willing to loan such funds and provide a waiver against any
+ and all rights to seek access to funds in our trust account. 
+
+ 
+
+(6)Includes
+ estimated amounts that may also be used in connection with our initial business combination
+ to fund a "no shop" provision and commitment fees for financing.
+
+ 
+
+ 68
+
+ Table of Contents
+
+ 
+ 
+
+The
+rules of the NASDAQ provide that at least 90% of the gross proceeds from this offering and the private placement be deposited in
+a trust account. Of the net proceeds of this offering and the sale of the private placement units, $100,000,000 (or $115,000,000 if the
+underwriters over-allotment option is exercised in full), including $2,500,000 (or up to $2,875,000 if the underwriters 
+over-allotment option is exercised in full) of deferred underwriting commissions, will, upon the consummation of this offering, be invested
+only in U.S. government treasury bills with a maturity of 180 days or less or in money market funds meeting certain conditions under
+Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. Based on current interest
+rates, we estimate that the interest earned on the trust account will be approximately $200,000 per year, assuming no exercise of the
+underwriters overallotment option and an interest rate of 0.2% per year, following the investment of such funds in specified U.S.
+government treasury bills or in specified money market funds. We will not be permitted to withdraw any of the principal or interest held
+in the trust account except for the withdrawal of interest to pay taxes, if any, the proceeds from this offering and the sale of the
+private placement units will not be released from the trust account until the earliest of (i) the completion of our initial business
+combination, (ii) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended
+and restated memorandum and articles of association to (A) modify the substance or timing of our obligation to redeem 100% of our
+public shares if we do not complete our initial business combination within 9 months from the closing of this offering (or up to 21 months
+from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in
+this prospectus) or (B) with respect to any other provision relating to shareholders rights or pre-business combination activity
+and (iii) the redemption of all of our public shares if we are unable to complete our initial business combination within 9 months
+from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate
+a business combination, as described in more detail in this prospectus), subject to applicable law.
+
+ 
+
+The
+net proceeds held in the trust account may be used as consideration to pay the sellers of a target business with which we ultimately
+complete our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all
+of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination,
+we may apply the balance of the cash released from the trust account for general corporate purposes, including for maintenance or expansion
+of operations of the post-transaction company, the payment of principal or interest due on indebtedness incurred in completing our initial
+business combination, to fund the purchase of other companies or for working capital. There is no limitation on our ability to raise
+funds privately or through loans in connection with our initial business combination.
+
+ 
+
+We
+believe that amounts not held in trust will be sufficient to pay the costs and expenses to which such proceeds are allocated. This belief
+is based on the fact that while we may begin preliminary due diligence of a target business in connection with an indication of interest,
+we intend to undertake in-depth due diligence, depending on the circumstances of the relevant prospective acquisition, only after we
+have negotiated and signed a letter of intent or other preliminary agreement that addresses the terms of a business combination. However,
+if our estimate of the costs of undertaking in-depth due diligence and negotiating a business combination is less than the actual amount
+necessary to do so, we may be required to raise additional capital, the amount, availability and cost of which is currently unascertainable.
+If we are required to seek additional capital, we could seek such additional capital through loans or additional investments from our
+sponsor, members of our management team or their affiliates, but such persons are not under any obligation to advance funds to, or invest
+in, us.
+
+ 
+
+We
+will enter into an Administrative Services Agreement pursuant to which we will pay an affiliate of our sponsor (M-Star Management Corporation)
+a total of $10,000 per month for office space, administrative and support services. Upon completion of our initial business combination
+or our liquidation, we will cease paying these monthly fees.
+
+ 
+
+Prior
+to the closing of this offering, our sponsor has agreed to loan us up to $300,000 to be used for a portion of the expenses of this offering.
+As of December 31, 2021, we had borrowed $300,000 under the promissory note with our sponsor. These loans are non-interest bearing, unsecured
+and are due at the earlier of March 31, 2022 or the closing of this offering. These loans will be repaid upon the closing of this offering
+out of the $500,000 allotted to the payment of offering expenses.
+
+ 
+
+ 69
+
+ Table of Contents
+
+ 
+
+ 
+
+ In
+addition, in order to finance transaction costs in connection with an intended initial business combination, our sponsor or an affiliate
+of our sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete
+our initial business combination, we would repay such loaned amounts out of the proceeds of the trust account released to us. Otherwise,
+such loans would be repaid only out of funds held outside the trust account. In the event that our initial business combination does
+not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from
+our trust account would be used to repay such loaned amounts. Up to $1,500,000 of such loans may be convertible into units at a price
+of $10.00 per unit (which, for example, would result in the holders being issued 165,000 ordinary shares if $1,500,000 of notes were
+so converted (including 15,000 shares upon the closing of our initial business combination in respect of 150,000 rights included in such
+units), as well as 150,000 warrants to purchase 150,000 shares) at the option of the lender. The units would be identical to the private
+placement units issued to our sponsor. The terms of such loans by our officers and directors, if any, have not been determined and no
+written agreements exist with respect to such loans. We do not expect to seek loans from parties other than our sponsor or an affiliate
+of our sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights
+to seek access to funds in our trust account. 
+
+ 
+
+If
+we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
+combination pursuant to the tender offer rules, our sponsor, directors, officers, advisors or their affiliates may also purchase shares
+in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination.
+Please see "Proposed Business — Permitted purchases of our securities" for a description of how such persons will determine
+which shareholders to seek to acquire shares from. The price per share paid in any such transaction may be different than the amount
+per share a public shareholder would receive if it elected to redeem its shares in connection with our initial business combination.
+However, such persons have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms
+or conditions for any such transactions. If they engage in such transactions, they will not make any such purchases when they are in
+possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by Regulation M under
+the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer
+rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however,
+if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply
+with such rules.
+
+ 
+
+We
+may not redeem our public shares in an amount that would cause our net tangible assets, after payment of the deferred underwriting commissions,
+to be less than $5,000,001 upon consummation of our initial business combination (so that in either event we are not subject to the SEC s
+"penny stock" rules). Additionally the terms of the agreement for our initial business combination may require as a closing
+condition that we have a minimum net worth or a certain amount of cash. If too many public shareholders exercise their redemption rights
+so that we cannot satisfy the net tangible asset requirement or any net worth or cash requirements, and we are unable to raise additional
+funds, we would not proceed with the redemption of our public shares or the business combination, and instead may search for an alternate
+business combination.
+
+ 
+
+A
+public shareholder will be entitled to receive funds from the trust account only upon the earlier to occur of: (i) the completion
+of our initial business combination, (ii) the redemption of any public shares properly tendered in connection with a shareholder
+vote to amend our amended and restated memorandum and articles of association to (A) modify the substance or timing of our obligation
+to redeem 100% of our public shares if we do not complete our initial business combination within 9 months from the closing of this offering
+(or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination, as described
+in more detail in this prospectus) or (B) with respect to any other provision relating to shareholders rights or pre-business
+combination activity and (iii) the redemption of all of our public shares if we are unable to complete our initial business combination
+within 9 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time
+to consummate a business combination, as described in more detail in this prospectus), subject to applicable law. In no other circumstances
+will a public shareholder have any right or interest of any kind to or in the trust account.
+
+ 
+
+Our
+sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption
+rights with respect to their founder shares, private placement shares and any public shares they may hold in connection with the completion
+of our initial business combination. In addition, our sponsor, officers and directors have agreed to waive their rights to liquidating
+distributions from the trust account with respect to their founder shares or private placement shares if we fail to complete our initial
+business combination within the prescribed time frame. However, if our sponsor or any of our officers, directors or affiliates acquires
+public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such
+public shares if we fail to complete our initial business combination within the prescribed time frame.
+
+ 
+
+ 70
+
+ Table of Contents
+
+ 
+
+ 
+
+DIVIDEND
+POLICY
+
+ 
+
+We
+have not paid any cash dividends on our ordinary shares to date and do not intend to pay cash dividends prior to the completion of our
+initial business combination. The payment of cash dividends in the future will be dependent upon our revenues and earnings, if any, capital
+requirements and general financial condition subsequent to completion of our initial business combination. The payment of any cash dividends
+subsequent to our initial business combination will be within the discretion of our Board of Directors at such time and we will only
+pay such dividend out of our profits or share premium (subject to solvency requirements) as permitted under Cayman Islands law. In addition,
+our Board of Directors is not currently contemplating and does not anticipate declaring any share capitalizations in the foreseeable
+future, except if we increase the size of the offering, in which case we will effect a capitalization or share surrender or redemption
+or other appropriate mechanism immediately prior to the consummation of the offering in such amount as to maintain the ownership of our
+sponsor prior to this offering at 20% of our issued and outstanding ordinary shares upon the consummation of this offering (assuming
+it does not purchase units in this offering and not taking into account ownership of the private placement units). Further, if we incur
+any indebtedness in connection with our initial business combination, our ability to declare dividends may be limited by restrictive
+covenants we may agree to in connection therewith.
+
+ 
+
+ 71
+
+ Table of Contents
+
+ 
+
+ 
+
+DILUTION
+
+ 
+
+The
+difference between the public offering price per share, assuming no value is attributed to the warrants included in the units we are
+offering by this prospectus and included in the private placement units, and the pro forma net tangible book value per share after this
+offering constitutes the dilution to investors in this offering. Such calculation does not reflect any dilution associated with sale
+and exercise of warrants, including the private placement warrants, which could cause the actual dilution to public shareholders to be
+higher, particularly where a cashless exercise alternative is utilized to exercise the warrants. On April 12, 2021, the staff of
+the SEC issued a public statement entitled "Staff Statement on Accounting and Reporting Considerations for Warrants issued by Special
+Purpose Acquisition Companies ("SPACs"). In the statement, the SEC staff expressed its view that certain terms and conditions
+common to SPAC warrants may require the warrants to be classified as liabilities on the SPAC s balance sheet as opposed to equity.
+Based upon its review of the SEC release and ASC 815-40, management has determined to classify our warrants as equity. The dilution calculation
+below account for classification of the warrants and private placement warrants as equity. Net tangible book value per share is determined
+by dividing our net tangible book value, which is our total tangible assets less total liabilities (including the value of ordinary shares
+which may be redeemed for cash), by the number of outstanding ordinary shares.
+
+ 
+
+On
+July 5, 2021, our sponsor purchased a total of 1,437,500 ordinary shares for an aggregate price of $25,000. On September 26, 2021, the
+Company purchased back all the 1,437,500 founder shares for $25,000 and reissued 2,875,000 shares to our sponsor for $25,000, or approximately
+$0.01 per shares. As a result, our net tangible book value became ($236,372), or approximately ($0.08) per share. For the purposes of
+the dilution calculation, in order to present the maximum estimated dilution as a result of this offering, we have assumed (i) the
+issuance of 0.1 ordinary shares for each right included in the public units and private placement units, as such issuance will occur
+upon a business combination without the payment of additional consideration and (ii) the number of ordinary shares included in the
+units offered hereby will be deemed to be 13,830,000 (consisting of 10,000,000 ordinary shares included in the units we are offering
+by this prospectus and 1,030,000 ordinary shares for the outstanding rights), and the price per ordinary share in this offering will
+be deemed to be $9.09. After giving effect to the sale of 13,830,000 ordinary shares included in the units we are offering by this prospectus,
+and the deduction of underwriting discounts and estimated expenses of this offering, and the sale of the private placement units, our
+pro forma as adjusted net tangible book value at December 31, 2021 would have been ($1,999,850) or $(0.52) per share, representing an
+immediate decrease in net tangible book value of $9.61 per share to the initial shareholders and an immediate dilution of 105.74% per
+share. For purposes of presentation, our pro forma as adjusted net tangible book value after this offering is ($1,999,850) less than
+it otherwise would have been because if we effect our initial business combination, the redemption rights of the public shareholders
+(but not our initial shareholders) may result in the redemption of up to 100,000,000 shares sold in this offering.
+
+ 
+
+The
+following table illustrates the dilution to our public shareholders on a per-share basis, assuming (i) no value is attributed to
+the rights included in the units and the private placement units and (ii) no value is attributed to the warrants included in the
+units and the private placement warrants.
+
+ 
+
+ 
+ 
+ Without
+ over-allotment 
+ With
+ over-allotment 
+
+ 
+ Public
+ offering price 
+ $9.09 
+ $9.09 
+
+ 
+ Net
+ tangible book value before this offering 
+ $(0.08) 
+ $(0.08)
+
+ 
+ Decrease
+ attributable to new investors 
+ (0.44) 
+ (0.46)
+
+ 
+ Pro
+ forma net tangible book value after this offering and the sale of the private placement units 
+ (0.52) 
+ (0.54)
+
+ 
+ Dilution
+ to public shareholders 
+ $9.61 
+ $9.63 
+
+ 
+ Percentage
+ of dilution to new investors 
+ 105.74% 
+ 105.94%
+
+ 
+
+ 
+
+ 72
+
+ Table of Contents
+
+ 
+
+ 
+
+For
+purposes of presentation, we have reduced our pro forma net tangible book value after this offering (assuming no exercise of the underwriters 
+over-allotment option) by $100,000,000 because holders of up to approximately 100.0% of our public shares may redeem their shares for
+a pro rata share of the aggregate amount then on deposit in the trust account at a per-share redemption price equal to the amount in
+the trust account as set forth in our tender offer or proxy materials (initially anticipated to be the aggregate amount held in trust
+two days prior to the commencement of our tender offer or shareholders meeting, including interest (which interest shall be net of taxes
+payable) divided by the number of ordinary shares sold in this offering).
+
+ 
+
+The
+following table sets forth information with respect to our sponsor and the public shareholders:
+
+ 
+
+ 
+ 
+ Shares
+ Purchased 
+ Total
+ Consideration 
+ Average
+ Price 
+
+ 
+ 
+ Number 
+ Percentage 
+ Amount 
+ Percentage 
+ per
+ Share 
+
+ 
+ Sponsor
+ (founder shares) 
+ 2,500,000(1) 
+ 18.08% 
+ $25,000 
+ 0.02% 
+ $0.01 
+
+ 
+ Shareholders
+ with respect to private placement shares 
+ 330,000(2) 
+ 2.40% 
+ 3,000,000 
+ 2.92% 
+ $9.09 
+
+ 
+ Public
+ shareholders 
+ 11,000,000(3) 
+ 79.52% 
+ 100,000,000 
+ 97.06% 
+ $9.09 
+
+ 
+ Total 
+ 13,830,000 
+ 100.00% 
+ 103,025,000 
+ $100.00% 
+ 
+
+ 
+
+ 
+
+ 
+
+(1)Assumes
+ the over-allotment option has not been exercised and an aggregate of 375,000 founder shares
+ have been forfeited by our sponsor as a result thereof.
+
+ 
+ (2)
+ Assumes
+ the issuance of an additional 30,000 shares underlying the rights included in the private placement units.
+
+ 
+ (3)
+ Assumes
+ the issuance of an additional 1,000,000 shares underlying the rights issued to public shareholders.
+
+ 
+
+ 
+
+ 
+ 
+ Without 
+ With 
+
+ 
+ Numerator: 
+ over-allotment 
+ over-allotment 
+
+ 
+ Net
+ tangible book value before this offering 
+ $(236,372) 
+ (236,372)
+
+ 
+ Offering
+ costs 
+ 236,522 
+ 236,522 
+
+ 
+ Proceeds
+ from this offering and sale of the private placement units, net of expenses 
+ 100,500,000 
+ 115,500,000 
+
+ 
+ Less:
+ deferred underwriters commissions payable 
+ (2,500,000) 
+ (2,875,000)
+
+ 
+ Less:
+ proceeds held in trust subject to redemption 
+ (100,000,000) 
+ (115,000,000)
+
+ 
+ 
+ $(1,999,850) 
+ (2,374,850)
+
+ 
+ Denominator: 
+ 
+ 
+
+ 
+ Ordinary
+ shares outstanding prior to this offering 
+ 2,875,000 
+ 2,875,000 
+
+ 
+ Shares
+ forfeited if over-allotment is not exercised 
+ (375,000) 
+ 
+
+ 
+ Ordinary
+ shares included in the units offered 
+ 10,000,000 
+ 11,500,000 
+
+ 
+ Ordinary
+ shares underlying the rights to be included in the public units 
+ 1,000,000 
+ 1,150,000 
+
+ 
+ Ordinary
+ shares included in the private unit 
+ 300,000 
+ 330,000 
+
+ 
+ Ordinary
+ shares underlying the rights to be included in the private units 
+ 30,000 
+ 33,000 
+
+ 
+ Less:
+ shares subject to redemption 
+ (10,000,000) 
+ (11,500,000)
+
+ 
+ 
+ $3,830,000 
+ 4,388,000 
+
+ 
+
+ 
+
+ 73
+
+ Table of Contents
+
+ 
+
+ 
+
+CAPITALIZATION
+
+ 
+
+The
+following table sets forth our capitalization as of December 31, 2021 as follows:
+
+ 
+
+ on
+ an actual basis; and
+
+ 
+
+ on
+ an as adjusted basis to give effect to the sale of our 10,000,000 units in this offering
+ for $100,000,000 (or $10.00 per unit) and the sale of 300,000 private placement units for
+ $3,000,000 (or $10.00 per unit) and the application of the estimated net proceeds derived
+ from the sale of such securities
+
+ 
+
+ 
+ 
+ December
+ 31, 2021 
+
+ 
+ 
+ Actual 
+ As
+ Adjusted(1) 
+
+ 
+ Deferred
+ underwriting commissions 
+ $— 
+ $2,500,000 
+
+ 
+ Notes
+ payable to related party(2) 
+ 300,000 
+ — 
+
+ 
+ Ordinary
+ shares, subject to redemption(3) 
+ — 
+ 100,000,000 
+
+ 
+ Shareholders 
+ equity: 
+ 
+ 
+
+ 
+ Ordinary
+ shares, par value $0.001 per share, 50,000,000 shares authorized; 2,875,000 shares issued and outstanding per actual, pro forma and
+ as adjusted, respectively; (excluding 0 and 10,000,000 shares subject to redemption) (actual, pro forma and as adjusted), respectively(4)(5) 
+ 2,875 
+ 2,875 
+
+ 
+ Additional
+ paid in capital 
+ 22,125 
+ - 
+
+ 
+ Accumulated
+ deficit 
+ (24,850) 
+ (2,002,725)
+
+ 
+ Total
+ shareholders equity/(deficit) 
+ $150 
+ $(1,999,850)
+
+ 
+ Total
+ capitalization 
+ $300,150 
+ $100,500,150 
+
+ 
+
+ 
+
+ 
+
+(1)Assumes
+ the full forfeiture of 375,000 shares that are subject to forfeiture by our sponsor depending
+ on the extent to which the underwriters over-allotment option is exercised. The proceeds
+ of the sale of such shares will not be deposited into the trust account, the shares will
+ not be eligible for redemption from the trust account.
+
+ 
+
+(2)Our
+ sponsor has agreed to loan us up to $300,000 under an unsecured promissory note to be used
+ for a portion of the expenses of this offering. As of December 31, 2021, we had borrowed
+ $300,000 under the promissory note with our sponsor.
+
+ 
+
+(3)Upon
+ the completion of our initial business combination, we will provide our shareholders with
+ the opportunity to redeem their public shares for cash equal to their pro rata share of the
+ aggregate amount then on deposit in the trust account as of two business days prior to the
+ consummation of the initial business combination including interest earned on the funds held
+ in the trust account and not previously released to us to pay our taxes or for working capital
+ purposes, subject to the limitations described herein and any limitations (including, but
+ not limited to, cash requirements) created by the terms of the proposed initial business
+ combination.
+
+ 
+
+ 74
+
+ Table of Contents
+
+ 
+
+ 
+
+(4)All
+ of the 10,000,000 shares of ordinary shares sold as part of the units in the offering
+ contain a redemption feature which allows for the redemption of such public shares in connection
+ with our liquidation, if there is a shareholder vote or tender offer in connection with the
+ business combination and in connection with certain amendments to our amended and restated
+ certificate of incorporation. In accordance with SEC and its guidance on redeemable equity
+ instruments, which has been codified in ASC 480-10-S99, redemption provisions not solely
+ within the control of a company require ordinary shares subject to redemption to be classified
+ outside of permanent equity. Given that the 10,000,000 shares of ordinary shares sold as
+ part of the units in the offering will be issued with other freestanding instruments (i.e.,
+ public warrants), the initial carrying value of ordinary shares classified as temporary equity
+ will be the allocated proceeds determined in accordance with ASC 470-20. Our ordinary shares
+ are subject to ASC 480-10-S99. If it is probable that the equity instrument will become redeemable,
+ we have the option to either (i) accrete changes in the redemption value over the period
+ from the date of issuance (or from the date that it becomes probable that the instrument
+ will become redeemable, if later) to the earliest redemption date of the instrument or (ii)
+ recognize changes in the redemption value immediately as they occur and adjust the carrying
+ amount of the instrument to equal the redemption value at the end of each reporting period.
+ We have elected to recognize the changes immediately. The accretion or remeasurement will
+ be treated as a deemed dividend (i.e., a reduction to retained earnings, or in absence of
+ retained earnings, additional paid-in capital).
+
+ 
+
+(5)Actual
+ share amount is prior to any forfeiture of founder shares by our sponsor and as adjusted
+ amount assumes no exercise of the underwriters over-allotment option.
+
+ 
+
+If
+we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business
+combination pursuant to the tender offer rules, our sponsor, initial shareholders, directors, executive officers or their affiliates
+may purchase shares or public warrants in privately negotiated transactions or in the open market either prior to or following the completion
+of our initial business combination. In the event of any such purchases of our shares prior to the completion of our initial business
+combination, the number of ordinary shares subject to redemption will be reduced by the amount of any such purchases, increasing the
+pro forma net tangible book value per share. See "Proposed Business — Effecting Our Initial Business Combination —
+Permitted Purchases of Our Securities."
+
+ 
+
+ 75
+
+ Table of Contents
+
+ 
+
+ 
+
+MANAGEMENT S
+DISCUSSION AND ANALYSIS OF
+
+FINANCIAL CONDITION AND RESULTS OF OPERATIONS
+
+ 
+
+Overview
+
+ 
+
+ We are a blank check company incorporated
+as a Cayman Islands exempted company and incorporated for the purpose of effecting a merger, share exchange, asset acquisition, stock
+purchase, reorganization or similar business combination with one or more businesses. We have not selected any specific business combination
+target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business
+combination target. We have not identified any particular geographical area or country in which we may seek a business combination. However,
+we shall not consider or undertake a business combination with any entity or business that is based in the People s Republic of
+China, including Hong Kong and Macau, or that has its principal or a majority of its business operations in such jurisdictions in. 
+
+ 
+
+We
+intend to effectuate our initial business combination using cash from the proceeds of this offering and the private placement of the
+private placement units, the proceeds of the sale of our securities in connection with our initial business combination (pursuant to
+backstop agreements we may enter into following the consummation of this offering or a future private placement offering of our securities
+(commonly known as a "PIPE" transaction) or otherwise), our shares, debt or a combination of cash, stock and debt.
+
+ 
+
+The
+issuance of additional ordinary shares in a business combination:
+
+ 
+
+ may
+ significantly dilute the equity interest of investors in this offering;
+
+ 
+
+ could
+ cause a change of control if a substantial number of our ordinary shares are issued, which
+ may affect, among other things, our ability to use our net operating loss carry forwards,
+ if any, and could result in the resignation or removal of our present officers and directors;
+
+ 
+
+ may
+ have the effect of delaying or preventing a change of control of us by diluting the share
+ ownership or voting rights of a person seeking to obtain control of us; and
+
+ 
+
+ may
+ adversely affect prevailing market prices for our ordinary shares and/or warrants.
+
+ 
+
+Similarly,
+if we issue debt securities, it could result in:
+
+ 
+
+ default
+ and foreclosure on our assets if our operating revenues after an initial business combination
+ are insufficient to repay our debt obligations;
+
+ 
+
+ acceleration
+ of our obligations to repay the indebtedness even if we make all principal and interest payments
+ when due if we breach certain covenants that require the maintenance of certain financial
+ ratios or reserves without a waiver or renegotiation of that covenant;
+
+ 
+
+ our
+ immediate payment of all principal and accrued interest, if any, if the debt security is
+ payable on demand;
+
+ 
+
+ our
+ inability to obtain necessary additional financing if the debt security contains covenants
+ restricting our ability to obtain such financing while the debt security is outstanding;
+
+ 
+
+ our
+ inability to pay dividends on our ordinary shares;
+
+ 
+
+ using
+ a substantial portion of our cash flow to pay principal and interest on our debt, which will
+ reduce the funds available for dividends on our ordinary shares if declared, expenses, capital
+ expenditures, acquisitions and other general corporate purposes;
+
+ 
+
+ limitations
+ on our flexibility in planning for and reacting to changes in our business and in the industry
+ in which we operate;
+
+ 
+
+ increased
+ vulnerability to adverse changes in general economic, industry and competitive conditions
+ and adverse changes in government regulation; and
+
+ 
+
+ limitations
+ on our ability to borrow additional amounts for expenses, capital expenditures, acquisitions,
+ debt service requirements, execution of our strategy and other purposes and other disadvantages
+ compared to our competitors who have less debt.
+
+ 
+
+ 76
+
+ Table of Contents
+
+ 
+
+ 
+
+Results
+of Operations and Known Trends or Future Events
+
+ 
+
+We
+have neither engaged in any operations nor generated any revenues to date. Our only activities since inception have been organizational
+activities and those necessary to prepare for this offering. Following this offering, we will not generate any operating revenues until
+after completion of our initial business combination. We expect to generate non-operating income in the form of interest income on cash
+and marketable securities held in the trust account after this offering. There has been no significant change in our financial or trading
+position and no material adverse change has occurred since the date of our audited financial statements. After this offering, we expect
+to incur increased expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance),
+as well as for due diligence expenses. We expect our expenses to increase substantially after the closing of this offering.
+
+ 
+
+Liquidity
+and Capital Resources
+
+ 
+
+As
+indicated in the accompanying financial statements, at December 31, 2021, we had $95,978 in cash, and a working capital deficit of $236,372,
+excluding deferred offering cost. Further, we expect to continue to incur significant costs in the pursuit of our financing and acquisition
+plans. We cannot assure you that our plans to raise capital or to complete our initial business combination will be successful. These
+factors, among others, raise substantial doubt about our ability to continue as a going concern.
+
+ 
+
+Our
+liquidity needs have been satisfied prior to completion of this offering through receipt of $25,000 from the sale of the founder shares
+to our sponsor and up to $300,000 in loans from our sponsor under an unsecured promissory note. As of December 31, 2021, we had borrowed
+$300,000 under the unsecured promissory note. We estimate that the net proceeds from (i) the sale of the units in this offering,
+after deducting offering expenses of approximately $500,000 and underwriting commissions of $2,000,000 (or $2,300,000 if the underwriters 
+over-allotment option is exercised in full) (excluding deferred underwriting commissions of $2,500,000 (or up to $2,875,000 if the underwriters 
+over-allotment option is exercised in full)), and (ii) the sale of the private placement units for a purchase price of $3,000,000
+(or $3,300,000 if the underwriters over-allotment option is exercised in full), will be $100,000,000 (or $115,000,000 if the underwriters 
+over-allotment option is exercised in full). Of this amount, $100,000,000 or $115,000,000 if the underwriters over-allotment option
+is exercised in full (including $2,500,000 (or up to $2,875,000 if the underwriters over-allotment option is exercised in full)
+in deferred underwriting commissions) will be deposited into a non-interest bearing trust account. The funds in the trust account will
+be invested only in specified U.S. government treasury bills or in specified money market funds. The remaining $500,000 (or $500,000
+if the underwriters over-allotment option is exercised in full) will not be held in the trust account. In the event that our offering
+expenses exceed our estimate of $500,000, we may fund such excess with funds not to be held in the trust account. In such case, the amount
+of funds we intend to be held outside the trust account would decrease by a corresponding amount. Conversely, in the event that the offering
+expenses are less than our estimate of $500,000, the amount of funds we intend to be held outside the trust account would increase by
+a corresponding amount.
+
+ 
+
+We
+intend to use substantially all of the funds held in the trust account, including any amounts representing interest earned on the trust
+account (which interest shall be net of taxes payable and excluding deferred underwriting commissions) to complete our initial business
+combination. We may withdraw interest to pay taxes, if any. Our annual income tax obligations will depend on the amount of interest and
+other income earned on the amounts held in the trust account. To the extent that our ordinary shares or debt is used, in whole or in
+part, as consideration to complete our initial business combination, the remaining proceeds held in the trust account will be used as
+working capital to finance the operations of the target business or businesses, make other acquisitions and pursue our growth strategies.
+
+ 
+
+After
+paying estimated offering expenses and prior to the completion of our initial business combination, we will have available to us approximately
+$500,000 (or $500,000 if the underwriters over-allotment option is exercised in full) of proceeds held outside the trust account.
+We will use these funds primarily to identify and evaluate target businesses, perform business due diligence on prospective target businesses,
+travel to and from the offices, plants or similar locations of prospective target businesses or their representatives or owners, review
+corporate documents and material agreements of prospective target businesses, structure, negotiate and complete a business combination,
+and to pay taxes to the extent the interest earned on the trust account is not sufficient to pay our taxes.
+
+ 
+
+ In
+order to fund working capital deficiencies or finance transaction costs in connection with an intended initial business combination,
+our sponsor or an affiliate of our sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may
+be required. If we complete our initial business combination, we would repay such loaned amounts. In the event that our initial business
+combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts but
+no proceeds from our trust account would be used for such repayment. Up to $1,500,000 of such loans may be convertible into units at
+a price of $10.00 per unit (which, for example, would result in the holders being issued 165,000 ordinary shares if $1,500,000 of notes
+were so converted (including 15,000 shares upon the closing of our initial business combination in respect of 150,000 rights included
+in such units), as well as 150,000 warrants to purchase 150,000 shares) at the option of the lender. The units would be identical to
+the private placement units issued to our sponsor. The terms of such loans by our officers and directors, if any, have not been determined
+and no written agreements exist with respect to such loans. We do not expect to seek loans from parties other than our sponsor or an
+affiliate of our sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all
+rights to seek access to funds in our trust account. 
+
+ 
+
+ 77
+
+ Table of Contents
+
+ 
+
+ 
+
+We
+expect our primary liquidity requirements during that period to include approximately $125,000 for legal, accounting, due diligence,
+travel and other expenses associated with structuring, negotiating and documenting successful business combinations; $63,000 for legal
+and accounting fees related to regulatory reporting requirements; $50,000 for NASDAQ and other regulatory fees; $120,000 for office space,
+administrative and support services; and $120,000 for Director and Officer liability insurance premiums.
+
+ 
+
+These
+amounts stated in the paragraph above are estimates and may differ materially from our actual expenses. In addition, we could use a portion
+of the funds not being placed in trust or loans from our sponsor to pay commitment fees for financing, fees to consultants to assist
+us with our search for a target business or as a down payment or to fund a "no-shop" provision (a provision designed to keep
+target businesses from "shopping" around for transactions with other companies on terms more favorable to such target businesses)
+with respect to a particular proposed business combination, although we do not have any current intention to do so. If we entered into
+an agreement where we paid for the right to receive exclusivity from a target business, the amount that would be used as a down payment
+or to fund a "no-shop" provision would be determined based on the terms of the specific business combination and the amount
+of our available funds at the time. Our forfeiture of such funds (whether as a result of our breach or otherwise) could result in our
+not having sufficient funds to continue searching for, or conducting due diligence with respect to, prospective target businesses.
+
+ 
+
+Other
+than potential loans from our sponsor we do not believe we will need to raise additional funds following this offering in order to meet
+the expenditures required for operating our business. However, if our estimates of the costs of identifying a target business, undertaking
+in-depth due diligence and negotiating an initial business combination are less than the actual amount necessary to do so, we may have
+insufficient funds available to operate our business prior to our initial business combination. Moreover, we may need to obtain additional
+financing either to complete our initial business combination or because we become obligated to redeem a significant number of our public
+shares upon completion of our initial business combination, in which case we may issue additional securities or incur debt in connection
+with such business combination.
+
+ 
+
+Controls
+and Procedures
+
+ 
+
+ We
+are not currently required to maintain an effective system of internal controls as defined by Section 404 of the Sarbanes-Oxley
+Act. We will be required to comply with the internal control requirements of the Sarbanes-Oxley Act for the fiscal year ending December 31,
+2023. Only in the event that we are deemed to be a large accelerated filer or an accelerated filer would we be required to comply with
+the independent registered public accounting firm attestation requirement. Further, for as long as we remain an emerging growth company
+as defined in the JOBS Act, we intend to take advantage of certain exemptions from various reporting requirements that are applicable
+to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the
+independent registered public accounting firm attestation requirement. 
+
+ 
+
+Prior
+to the closing of this offering, we have not completed an assessment, nor have our auditors tested our systems, of internal controls.
+We expect to assess the internal controls of our target business or businesses prior to the completion of our initial business combination
+and, if necessary, to implement and test additional controls as we may determine are necessary in order to state that we maintain an
+effective system of internal controls. A target business may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding
+the adequacy of internal controls. Many small and mid-sized target businesses we may consider for our initial business combination may
+have internal controls that need improvement in areas such as:
+
+ 
+
+ staffing
+ for financial, accounting and external reporting areas, including segregation of duties;
+
+ 
+
+ reconciliation
+ of accounts;
+
+ 
+
+ proper
+ recording of expenses and liabilities in the period to which they relate;
+
+ 
+
+ evidence
+ of internal review and approval of accounting transactions;
+
+ 
+
+ documentation
+ of processes, assumptions and conclusions underlying significant estimates; and
+
+ 
+
+ documentation
+ of accounting policies and procedures.
+
+ 
+
+ 78
+
+ Table of Contents
+
+ 
+
+ 
+
+Because
+it will take time, management involvement and perhaps outside resources to determine what internal control improvements are necessary
+for us to meet regulatory requirements and market expectations for our operation of a target business, we may incur significant expenses
+in meeting our public reporting responsibilities, particularly in the areas of designing, enhancing, or remediating internal and disclosure
+controls. Doing so effectively may also take longer than we expect, thus increasing our exposure to financial fraud or erroneous financing
+reporting.
+
+ 
+
+Once
+our management s report on internal controls is complete, we will retain our independent auditors to audit and render an opinion
+on such report when required by Section 404. The independent auditors may identify additional issues concerning a target business s
+internal controls while performing their audit of internal control over financial reporting.
+
+ 
+
+Quantitative
+and Qualitative Disclosures about Market Risk
+
+ 
+
+The
+net proceeds of this offering and the sale of the private placement units held in the trust account will be invested in U.S. government
+treasury bills with a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the
+Investment Company Act which invest only in direct U.S. government treasury obligations. Due to the short-term nature of these investments,
+we believe there will be no associated material exposure to interest rate risk.
+
+ 
+
+Related
+Party Transactions
+
+ 
+
+On
+July 5, 2021, our sponsor purchased a total 1,437,500 for an aggregate purchase price of $25,000, or approximately $0.02 per share. On
+September 26, 2021, the Company purchased back all the 1,437,500 founder shares for $25,000 and reissued 2,875,000 shares to our sponsor
+for $25,000, or approximately $0.01 per shares. The purchase price of the founder shares was determined by dividing the amount of cash
+contributed to the company by the number of founder shares issued. As such, our sponsor will own approximately 21.88% of our issued and
+outstanding shares after this offering (assuming it does not purchase units in this offering and taking into account ownership of the
+private placement units). If we increase or decrease the size of the offering, we will effect a capitalization or share surrender or
+redemption or other appropriate mechanism, as applicable with respect to our ordinary shares immediately prior to the consummation of
+the offering in such amount as to maintain the ownership of founder shares our sponsor at 20% of our issued and outstanding ordinary
+shares upon the consummation of this offering (assuming it does not purchase units in this offering and not taking into account ownership
+of the private placement units). Our sponsor does not intend to purchase any units in this offering.
+
+ 
+
+We
+will enter into an Administrative Services Agreement pursuant to which we will also pay an affiliate of our sponsor (M-Star Management
+Corporation) a total of $10,000 per month for office space, administrative and support services. Upon completion of our initial business
+combination or our liquidation, we will cease paying these monthly fees.
+
+ 
+
+Our
+sponsor, officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in
+connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business
+combinations. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers, directors or
+our or their affiliates and will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling
+on the reimbursement of out-of-pocket expenses incurred by such persons in connection with activities on our behalf.
+
+ 
+
+Our
+sponsor has agreed to loan us up to $300,000 under an unsecured promissory note to be used for a portion of the expenses of this offering.
+As of December 31, 2021, we had borrowed $300,000 under the promissory note with our sponsor. These loans are non-interest bearing, unsecured
+and are due at the earlier of March 31, 2022 or the closing of this offering. These loans will be repaid upon the closing of this
+offering out of the $500,000 allocated to the payment of offering expenses.
+
+ 
+
+ In
+addition, in order to finance transaction costs in connection with an intended initial business combination, our sponsor or an affiliate
+of our sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete
+our initial business combination, we would repay such loaned amounts. In the event that our initial business combination does not close,
+we may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust
+account would be used for such repayment. Up to $1,500,000 of such loans may be convertible into units at a price of $10.00 per unit
+(which, for example, would result in the holders being issued 165,000 ordinary shares if $1,500,000 of notes were so converted (including
+15,000 shares upon the closing of our initial business combination in respect of 150,000 rights included in such units), as well as 150,000
+warrants to purchase 150,000 shares) at the option of the lender. The units would be identical to the private placement units issued
+to our sponsor. The terms of such loans by our officers and directors, if any, have not been determined and no written agreements exist
+with respect to such loans. We do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do
+not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds
+in our trust account. 
+
+ 
+
+ 79
+
+ Table of Contents
+
+ 
+
+ 
+
+ Our
+sponsor has agreed to purchase an aggregate of 300,000 private placement units (or 330,000 units if the over-allotment option is exercised
+in full) at a price of $10.00 per unit, each unit consisting of one private placement share, one private placement right granting the
+holder thereof the right to receive one-tenth (1/10) of an ordinary share upon the consummation of an initial business combination, and
+one private placement warrant, in a private placement that will close simultaneously with the closing of this offering. Each private
+placement warrant entitles the holder to purchase one ordinary share at a price of $11.50 per whole share, subject to adjustment as provided
+herein. Our sponsor will be permitted to transfer the private placement units held by them to certain permitted transferees, including
+our officers and directors and other persons or entities affiliated with or related to them, but the transferees receiving such securities
+will be subject to the same agreements with respect to such securities as our sponsor. Otherwise, these units will not, subject to certain
+limited exceptions, be transferable or saleable until 30 days after the completion of our initial business combination. The private placement
+warrants may also be exercised by our sponsor, or its permitted transferees for cash or on a cashless basis. Otherwise, the private placement
+warrants have terms and provisions that are identical to those of the warrants being sold as part of the units in this offering. 
+
+ 
+
+Pursuant
+to a registration rights agreement we will enter into with our sponsor prior to the closing of this offering, we may be required to register
+certain securities for sale under the Securities Act. These holders, and holders of units issued upon conversion of working capital loans,
+if any, are entitled under the registration rights agreement to make up to three demands that we register certain of our securities held
+by them for sale under the Securities Act and to have the securities covered thereby registered for resale pursuant to Rule 415
+under the Securities Act. In addition, these holders have the right to include their securities in other registration statements filed
+by us. We will bear the costs and expenses of filing any such registration statements. See "Certain Relationships and Related Party
+Transactions."
+
+ 
+
+Off-Balance
+Sheet Arrangements; Commitments and Contractual Obligations; Quarterly Results
+
+ 
+
+As
+of December 31, 2021, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K. In
+connection with this proposed offering, the Company has agreed to pay professional fee of $25,000 upon initial filing with the SEC of
+the registration statement for the public offering, and $150,000 at the closing of the public offering.
+
+ 
+
+Leases
+
+ 
+
+We
+have entered into a short term month to month lease for office space at 132 West 31st Street, First Floor, New York, New York 10001 which
+we utilize for our main offices in the United States. The cost per month is approximately $189.
+
+ 
+
+JOBS Act
+
+ 
+
+On
+April 5, 2012, the JOBS Act was signed into law. The JOBS Act contains provisions that, among other things, relax certain reporting
+requirements for qualifying public companies. We will qualify as an "emerging growth company" and under the JOBS Act will
+be allowed to comply with new or revised accounting pronouncements based on the effective date for private (not publicly traded) companies.
+We are electing to delay the adoption of new or revised accounting standards, and as a result, we may not comply with new or revised
+accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. As a result,
+our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company
+effective dates.
+
+ 
+
+Additionally,
+we are in the process of evaluating the benefits of relying on the other reduced reporting requirements provided by the JOBS Act. Subject
+to certain conditions set forth in the JOBS Act, if, as an "emerging growth company." we choose to rely on such exemptions
+we may not be required to, among other things, (i) provide an auditor s attestation report on our system of internal controls
+over financial reporting pursuant to Section 404, (ii) provide all of the compensation disclosure that may be required of non-emerging
+growth public companies under the Dodd-Frank Wall Street Reform and Consumer Protection Act, (iii) comply with any requirement that
+may be adopted by the PCAOB regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional
+information about the audit and the financial statements (auditor discussion and analysis), and (iv) disclose certain executive
+compensation related items such as the correlation between executive compensation and performance and comparisons of the CEO s
+compensation to median employee compensation. These exemptions will apply for a period of five years following the completion of our
+initial public offering or until we are no longer an "emerging growth company," whichever is earlier.
+
+ 
+
+ 80
+
+ Table of Contents
+
+ 
+
+ 
+
+PROPOSED
+BUSINESS
+
+ 
+
+General
+
+ 
+
+We
+are a blank check company incorporated in the Cayman Islands and incorporated for the purpose of acquiring, engaging in a share exchange,
+share reconstruction and amalgamation with, purchasing all or substantially all of the assets of, entering into contractual arrangements
+with, or engaging in any other similar business combination with one or more businesses or entities, which we refer to throughout this
+prospectus as our initial business combination. We have not identified any acquisition target and we have not, nor has anyone on our
+behalf, initiated any discussions, directly or indirectly, to identify any acquisition target.
+
+ 
+
+Business
+Strategy
+
+ 
+
+ Our efforts in identifying prospective target
+businesses will not be limited to a particular geographic region. We believe that we will add value to these businesses primarily by
+providing them with access to the U.S. capital markets. We have not identified any particular geographical area or country in which we
+may seek a business combination. However, we shall not consider or undertake a business combination with any entity or business, that
+is based in the People s Republic of China, including Hong Kong and Macau, or that has its principal or a majority of its business
+operations in such jurisdictions.) 
+
+ 
+
+We
+will seek to capitalize on the strength of our management team. Our team consists of experienced professionals and senior operating executives.
+Collectively, our officers and directors have decades of experience in mergers and acquisitions, and operating companies. We believe
+we will benefit from their accomplishments, and specifically their current and recent activities in identifying attractive acquisition
+opportunities. However, there is no assurance that we will complete a business combination.
+
+ 
+
+We
+believe that the members of our management team and board of directors have valuable and applicable experience for sourcing and analyzing
+potential acquisition candidates across various industries and even though we are excluding potential target businesses in the People s
+Republic of China (including Hong Kong and Macau), have relevant and valuable experience on an international basis. Highlights of our
+team include the following:
+
+ 
+
+Our
+Chief Executive Officer, Mr. Man Chak Leung, has extensive experience in M&A industries. Mr. Leung has been the President and a director
+of Verity Acquisition Corp. since May 2021. Since August 2019, he has been serving as the General Manager of China Seven Star Holdings
+Limited, an investment holding company focusing on consumer and healthcare sectors in China. Mr. Leung served as a consultant to Silk
+Road Finance Corporation from May to December 2020. Mr. Leung served as Co-Head of Risk and Portfolio Management at China Minsheng Financial
+Holding Corporation Limited ("CM Financial") from 2017 to May 2019, a Hong Kong mainboard listed financial holding platform.
+He was responsible for all portfolio including primary and secondary, fixed income and other special situations including SPACs. Mr.
+Leung joined CM Financial in December 2016 from TPG Growth, a global mid-market private equity firm with over US$ 15 billion AUM, where
+he spent 10 years as an investment professional specializing in Healthcare, Financial Services, TMT, Consumer and Education in Greater
+China and South East Asia. Prior to that, he was with the Hong Kong office of the Cathay Capital Group between 2001 to 2006. He has accumulated
+extensive transaction experience including investments into eToro, Masan Group, FPT, ShangPharma, NT Pharma, Ivy Education Group, Vinda
+Paper and Rayli Magazine. He has also served on the board of the Ivy Education Group, a K12 Education Group in China between September
+2015 to February 2017, CM SPC and CM Asset Management (Hongkong) Company Limited between July 2018 to May 2019 and CM International Financial
+Leasing Investment Holding Company Limited between January 2018 to November 2019. Mr. Leung holds a Bachelor of Business and Administration
+(Finance) from City University of Hong Kong.
+
+ 
+
+ 81
+
+ Table of Contents
+
+ 
+
+ 
+
+Ms.
+Wenxi He has served as our Chief Financial Officer since June 2021. She serves as Chief Investment Officer at Still Waters Green Technology
+Limited, an asset management company based in London, specializing in the development and management of renewable energy and power generation
+assets, since February 2019. Ms. He has over 15 years of experience in the investment banking industry. Prior to joining Still Waters
+Green Technology Limited, she served as the Managing Director and Global Head of Commodity Exchange Traded Products at Bank of America
+Merrill Lynch in London. She was responsible for initiating and executing strategic solutions and issuance, trading physical and synthetic
+commodity products, and managing portfolio assets in energy, metals and agriculture, with a wide variety of commodity, currency and interest-rate
+risk. Prior to that, Ms. He traded and structured commodity derivative products at Citigroup, fixed income security products with a focus
+on structured credit and rates at UBS and RBC Capital Markets. Ms. He holds master s degrees in both Mathematical Finance and Engineering
+from University of Toronto, and a bachelor s degree in Engineering from Tongji University.
+
+ 
+
+Mr. Zhuo
+Wang will serve as an independent director immediately upon effectiveness of this prospectus. Mr. Wang serves as the director of Mingzhu
+Logistics Holdings Limited, a NASDAQ-listed company (YGMZ:US), since April 2018. Mr. Wang has over ten years of experience in investment
+and management. He has also been the marketing manager of Singapore construction design and supply company Springview Enterprises Private
+Limited since June 2018. Mr. Wang started to work as the director of an investment holding company, Exquisite Elite Limited since November
+2017. Since May 2017, Mr. Wang has been the managing director of China International Holdings, and its Hong Kong based subsidiaries,
+China International Securities Limited, a securities firm, overseeing the firm s brokerage services, business operations and performance,
+and China International Corporate Management Limited since June 2016, a consulting firm that provides a range of business solutions to
+small and medium sized companies in Asia. Since April 2016, Mr. Wang has also been the head of finance and operations at a Singaporean
+education consulting company Shines International Limited and a director of Total Best Investments Limited, an investment holding company
+since March 2016. Prior to that, Mr. Wang has been the head of finance and marketing of Singapore construction services provider GGL
+Enterprises Pte Ltd since 2012. Mr. Wang also served as a director on the board of various companies, including Belvedere Ventures Pte
+Ltd. between June 2011 to October 2016, a real estate development and construction company, Sandhurst Global Pte Ltd., and between September
+2013 to August 2014, a security personnel staffing and systems company, Acquired Time (HK) Limited. Mr. Wang holds a Bachelor of Science
+in Business Management from Babson College in Boston, Massachusetts.
+
+ 
+
+Mr.
+Zining Jiang will serve as an independent director immediately upon effectiveness of this prospectus. Mr. Jiang now serves as the general
+manager of Guangzhou Shanxin Trading Co. Ltd., which mainly engages in industrial raw material trade and import and export business since
+July 2018. Prior to that, since July 2015, Mr. Jiang served as the CEO of Guangzhou Yidao Investment Holding Co., Ltd. and an operational
+director at Guangdong Grape Wine Magazine Co., Ltd. In 2007, he joined Yangcheng Evening News Group as the deputy chief editor. He then
+joined China Southern Airlines as assistant to the general manager in April 2011, and was promoted as the operation director of China
+Southern Airlines Media Group. He joined PACOM Media Co. Ltd. in July 2001 and successively served as the chief editor of China Golf,
+Golf Digest and Golf Travel. Prior to that, Mr. Jiang joined Guangdong Cable TV station in 1996 as an editor upon graduation from Jinan
+University.
+
+ 
+
+Mr.
+Xinghua Fan will serve as an independent director immediately upon effectiveness of this prospectus. Mr. Fan currently serves as the
+Vice General Manager and is responsible for the financing and listing of SINO SIC Technology Development Co., Ltd. s silicon carbide
+project. Mr. Fan has served as the Senior Partner and Vice President of Beijing New Board Capital Investment Holdings Co. since 2014.
+At the same time, he is also the executive director of the World Union Fortune Entrepreneur Club and a member of the investment committee.
+Mr. Fan was the COO of Sino-American Holding Group from 2011 to 2013. From 2008 to 2011, he worked as the vice president of Zhongshuo
+Investment Guarantee Group. From 2005 to 2007, he has worked in Xinyuan Guarantee (China) Co., Ltd. as an operation center manager. Mr.
+Fan received a Master s Degree in College of Economics and Management (SEM) from Beihang University.
+
+ 
+
+ 82
+
+ Table of Contents
+
+ 
+
+ 
+
+Mr.
+Konstantin A. Sokolov has served as our Senior Advisor since June 2021. Mr. Sokolov has been the independent director of Alpha Star Acquisition
+Corporation since 19 July 2021. Mr. Sokolov is the founder and Chairman of Gotthard Investment AG, which is a private equity firm
+based in Zurich, Switzerland, focusing on financial services, asset management and global real estate. Since 2011, Gotthard Investment
+AG advised and managed multiple investment funds, and partnered with leading Swiss and Lichtenstein banks to invest globally in energy
+and real estate assets. Prior to that, Mr. Sokolov served as Managing Director of Centrica plc (British Gas and Direct Energy).
+Between 1997 to 2005, Mr. Sokolov served in senior leadership positions at Qwest Communication, Inc., a pioneer in fiber optics.
+Mr. Sokolov holds an Executive MBA degree from University of Chicago in 2005 and a Master s of Mathematics and Computer Science
+degree from St. Petersburg State University in 1997.
+
+ 
+
+Our
+management team will leverage its skills, expertise and strong network across industries to identify attractive target companies and
+provide guidance on the benefits of being a publicly-traded entity, including broader access to capital, liquidity for employee
+compensation and potential acquisitions, and expanded branding in the marketplace. In addition, we believe that we will be able to source
+potential targets from our sponsor s and management s contacts within private equity, investment banking, industry consulting
+firms, accounting firms, and investors in across industries. Upon completion of this offering, our management team and sponsor will communicate
+with their networks on our acquisition criteria and immediately begin screening opportunities.
+
+ 
+
+Investment
+Criteria
+
+ 
+
+Our
+management team intends to focus on creating shareholder value by leveraging its experience in the management, operation and financing
+of businesses to improve the efficiency of operations while implementing strategies to scale revenue organically and/or through acquisitions.
+We have identified the following general criteria and guidelines, which we believe are important in evaluating prospective target businesses.
+While we intend to use these criteria and guidelines in evaluating prospective businesses, we may deviate from these criteria and guidelines
+should we see justification to do so.
+
+ 
+
+ Middle-Market
+ Growth Business. We will primarily seek to acquire one or more growth businesses
+ with a total enterprise value of between $300,000,000 and $600,000,000. We believe that there
+ are a substantial number of potential target businesses within this valuation range that
+ can benefit from new capital for scalable operations to yield significant revenue and earnings
+ growth. We currently do not intend to acquire either a start-up company (a company that has
+ not yet established commercial operations) or a company with negative cash flow.
+
+ 
+
+ 
+ 
+ 
+ Strong
+ Management Teams with Proven Track Record: We intend to seek candidates who have strong management teams with a proven track
+ record of driving revenue growth, enhancing profitability and generating strong free cash flow. We will seek to partner with potential
+ target s management team and expect that the operating and financial abilities of our management and board will help potential
+ target company to unlock opportunities for future growth and enhanced profitability.
+
+ 
+
+ 
+
+ Business
+ with Revenue and Earnings Growth Potential. We
+ will seek to acquire one or more businesses that have the potential for significant revenue
+ and earnings growth through a combination of both existing and new product development, increased
+ production capacity, expense reduction and synergistic follow-on acquisitions resulting in
+ increased operating leverage.
+
+ 
+
+ Companies
+ with Potential for Strong Free Cash Flow Generation. We
+ will seek to acquire one or more businesses that have the potential to generate strong, stable
+ and increasing free cash flow. We intend to focus on one or more businesses that have predictable
+ revenue streams and definable low working capital and capital expenditure requirements. We
+ may also seek to prudently leverage this cash flow in order to enhance shareholder value.
+
+ 
+
+ Benefit
+ from Being a Public Company. We
+ intend to only acquire a business or businesses that will benefit from being publicly traded
+ and which can effectively utilize access to broader sources of capital and a public profile
+ that are associated with being a publicly traded company.
+
+ 
+
+ 83
+
+ Table of Contents
+
+ 
+
+ 
+
+These
+criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be
+based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our sponsor and
+management team may deem relevant. In the event that we decide to enter into an initial business combination with a target business that
+does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder
+communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation
+or tender offer materials, as applicable, that we would file with the United States Securities and Exchange Commission, or the SEC. In
+evaluating a prospective target business, we expect to conduct a due diligence review which may encompass, among other things, meetings
+with incumbent ownership, management and employees, document reviews, interviews of customers and suppliers, inspections of facilities,
+as well as reviewing financial and other information which will be made available to us.
+
+ 
+
+Sourcing
+of Potential Business Combination Targets
+
+ 
+
+Our
+management team has developed a broad network of contacts and corporate relationships. We believe that the network of contacts and relationships
+of our management team and our sponsor will provide us with an important source of business combination opportunities. In addition, we
+anticipate that target business candidates will be brought to our attention from various unaffiliated sources, including investment banking
+firms, private equity firms, consultants, accounting firms and business enterprises. We are not prohibited from pursuing an initial business
+combination with a company that is affiliated with our sponsor, officers or directors, or completing the business combination through
+a joint venture or other form of shared ownership with our sponsor, officers or directors.
+
+ 
+
+As
+more fully discussed in "Management — Conflicts of Interest," if any of our officers or directors becomes aware of
+a business combination opportunity that falls within the line of business of any entity to which he or she has then-existing fiduciary
+or contractual obligations, he or she may be required to present such business combination opportunity to such entity prior to presenting
+such business combination opportunity to us.
+
+ 
+
+Unless
+we complete our initial business combination with an affiliated entity, or our Board of Directors cannot independently determine the
+fair market value of the target business or businesses, we are not required to obtain an opinion from an independent investment banking
+firm, another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or from an
+independent accounting firm that the price we are paying for a target is fair to our company from a financial point of view. If no opinion
+is obtained, our shareholders will be relying on the business judgment of our Board of Directors, which will have significant discretion
+in choosing the standard used to establish the fair market value of the target or targets, and different methods of valuation may vary
+greatly in outcome from one another. Such standards used will be disclosed in our tender offer documents or proxy solicitation materials,
+as applicable, related to our initial business combination.
+
+ 
+
+Members
+of our management team may directly or indirectly own our ordinary shares and/or private placement units following this offering, and,
+accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which
+to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect
+to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a
+target business as a condition to any agreement with respect to our initial business combination.
+
+ 
+
+Each
+of our directors and officers presently has, and in the future any of our directors and our officers may have additional, fiduciary or
+contractual obligations to other entities pursuant to which such officer or director is or will be required to present acquisition opportunities
+to such entity. Accordingly, subject to his or her fiduciary duties under Cayman Islands law, if any of our officers or directors becomes
+aware of an acquisition opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations,
+he or she will need to honor his or her fiduciary or contractual obligations to present such acquisition opportunity to such entity,
+and only present it to us if such entity rejects the opportunity. Our amended and restated memorandum and articles of association will
+provide that, subject to his or her fiduciary duties under Cayman Islands law, we renounce our interest in any corporate opportunity
+offered to any officer or director unless such opportunity is expressly offered to such person solely in his or her capacity as a director
+or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be
+reasonable for us to pursue. We do not believe, however, that any fiduciary duties or contractual obligations of our directors or officers
+would materially undermine our ability to complete our business combination.
+
+ 
+
+ 84
+
+ Table of Contents
+
+ 
+
+ 
+
+Initial
+Business Combination
+
+ 
+
+The
+NASDAQ rules require that our initial business combination must be with one or more target businesses that together have an aggregate
+fair market value equal to at least 80% of the balance in the trust account (less any deferred underwriting commissions and taxes payable
+on interest earned) at the time of our signing a definitive agreement in connection with our initial business combination. If our Board
+of Directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion
+from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company
+we are seeking to acquire or an independent accounting firm with respect to the satisfaction of such criteria. We do not intend to purchase
+multiple businesses in unrelated industries in conjunction with our initial business combination. In the event that we were delisted
+from NASDAQ prior to completion of a business combination, we would not be subject to the NASDAQ rule requiring our initial business
+combination must be with one or more target businesses that together have an aggregate fair market value equal to at least 80% of the
+balance in the trust account.
+
+ 
+
+We
+anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares
+will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial
+business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target
+business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete
+such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target
+or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company
+under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires
+50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority
+interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction.
+For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding
+capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance
+of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority
+of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target
+business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned
+or acquired is what will be valued for purposes of the 80% of net assets test. If our initial business combination involves more than
+one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses.
+
+ 
+
+Prior
+to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities
+under Section 12 of the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange
+Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior
+or subsequent to the consummation of our initial business combination.
+
+ 
+
+Status
+as a Public Company
+
+ 
+
+We
+believe our structure will make us an attractive business combination partner to target businesses. As an existing public company, we
+offer a target business an alternative to the traditional initial public offering through a merger or other business combination. In
+this situation, the owners of the target business would exchange their shares of stock in the target business for our shares or for a
+combination of our shares and cash, allowing us to tailor the consideration to the specific needs of the sellers. Although there are
+various costs and obligations associated with being a public company, we believe target businesses will find this method a more certain
+and cost effective method to becoming a public company than the typical initial public offering. In a typical initial public offering,
+there are additional expenses incurred in marketing, road show and public reporting efforts that may not be present to the same extent
+in connection with a business combination with us.
+
+ 
+
+ 85
+
+ Table of Contents
+
+ 
+
+ 
+
+Furthermore,
+once a proposed business combination is completed, the target business will have effectively become public, whereas an initial public
+offering is always subject to the underwriters ability to complete the offering, as well as general market conditions, which could
+delay or prevent the offering from occurring. Once public, we believe the target business would then have greater access to capital and
+an additional means of providing management incentives consistent with shareholders interests. It can offer further benefits by
+augmenting a company s profile among potential new customers and vendors and aid in attracting talented employees.
+
+ 
+
+While
+we believe that our structure and our management team s backgrounds will make us an attractive business partner, some potential
+target businesses may have a negative view of us since we are a blank check company, without an operating history, and there is uncertainty
+relating to our ability to obtain shareholder approval of our proposed initial business combination and retain sufficient funds in our
+trust account in connection therewith.
+
+ 
+
+We
+are an "emerging growth company," as defined in the JOBS Act. We will remain an emerging growth company until the earlier
+of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in
+which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer,
+which means the market value of our ordinary shares that is held by non-affiliates exceeds $700 million as of the prior June 30th,
+and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period.
+
+ 
+
+Financial
+Position
+
+ 
+
+With
+funds available for a business combination initially in the amount of $97,500,000 assuming no redemptions and after payment of $2,500,000
+of deferred underwriting fees (or $112,125,000 assuming no redemptions and after payment of up to $2,875,000 of deferred underwriting
+fees if the underwriters over-allotment option is exercised in full), in each case before fees and expenses associated with our
+initial business combination, we offer a target business a variety of options such as creating a liquidity event for its owners, providing
+capital for the potential growth and expansion of its operations or strengthening its balance sheet by reducing its debt ratio. Because
+we are able to complete our initial business combination using our cash, debt or equity securities, or a combination of the foregoing,
+we have the flexibility to use the most efficient combination that will allow us to tailor the consideration to be paid to the target
+business to fit its needs and desires. However, we have not taken any steps to secure third party financing and there can be no assurance
+it will be available to us.
+
+ 
+
+Effecting
+Our Initial Business Combination
+
+ 
+
+We
+are not presently engaged in, and we will not engage in, any operations for an indefinite period of time following this offering. We
+intend to effectuate our initial business combination using cash from the proceeds of this offering and the private placement of the
+private placement units, our shares, debt or a combination of these as the consideration to be paid in our initial business combination.
+We may, although we do not currently intend to, seek to complete our initial business combination with a company or business that may
+be financially unstable or in its early stages of development or growth, start-up companies or companies with speculative business plans
+or excess leverage, which would subject us to the numerous risks inherent in such companies and businesses.
+
+ 
+
+If
+our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account
+are used for payment of the consideration in connection with our initial business combination or used for redemptions of our ordinary
+shares, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance
+or expansion of operations of the post-transaction company, the payment of principal or interest due on indebtedness incurred in completing
+our initial business combination, to fund the purchase of other companies or for working capital.
+
+ 
+
+We
+may seek to raise additional funds through a private offering of debt or equity securities in connection with the completion of our initial
+business combination, and we may effectuate our initial business combination using the proceeds of such offering rather than using the
+amounts held in the trust account.
+
+ 
+
+In
+the case of an initial business combination funded with assets other than the trust account assets, our tender offer documents or proxy
+materials disclosing the business combination would disclose the terms of the financing and, only if required by law, we would seek shareholder
+approval of such financing. There are no prohibitions on our ability to raise funds privately or through loans in connection with our
+initial business combination. At this time, we are not a party to any arrangement or understanding with any third party with respect
+to raising any additional funds through the sale of securities or otherwise.
+
+ 
+
+ 86
+
+ Table of Contents
+
+ 
+
+ 
+
+Selection
+of a Target Business and Structuring of Our Initial Business Combination
+
+ 
+
+The
+NASDAQ rules require that our initial business combination must be with one or more target businesses that together have an aggregate
+fair market value equal to at least 80% of the balance in the trust account (less any deferred underwriting commissions and taxes payable
+on interest earned) at the time of our signing a definitive agreement in connection with our initial business combination. The fair market
+value of the target or targets will be determined by our Board of Directors based upon one or more standards generally accepted by the
+financial community, such as discounted cash flow valuation or value of comparable businesses. Our shareholders will be relying on the
+business judgment of our Board of Directors, which will have significant discretion in choosing the standard used to establish the fair
+market value of the target or targets, and different methods of valuation may vary greatly in outcome from one another. Such standards
+used will be disclosed in our tender offer documents or proxy solicitation materials, as applicable, related to our initial business
+combination. In the event that we were delisted from NASDAQ prior to completion of a business combination, we would not be subject to
+the NASDAQ rule requiring our initial business combination must be with one or more target businesses that together have an aggregate
+fair market value equal to at least 80% of the balance in the trust account.
+
+ 
+
+If
+our board is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion
+from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company
+we are seeking to acquire or an independent accounting firm, with respect to the satisfaction of such criteria. We do not intend to purchase
+multiple businesses in unrelated industries in conjunction with our initial business combination. Subject to this requirement, our management
+will have virtually unrestricted flexibility in identifying and selecting one or more prospective target businesses, although we will
+not be permitted to effectuate our initial business combination with another blank check company or a similar company with nominal operations.
+
+ 
+
+In
+any case, we will only complete an initial business combination in which we own or acquire 50% or more of the outstanding voting securities
+of the target or otherwise acquire a controlling interest in the target sufficient for it not to be required to register as an investment
+company under the Investment Company Act. If we own or acquire less than 100% of the equity interests or assets of a target business
+or businesses, the portion of such business or businesses that are owned or acquired by the post-transaction company is what will be
+valued for purposes of the 80% of net assets test. There is no basis for investors in this offering to evaluate the possible merits or
+risks of any target business with which we may ultimately complete our initial business combination.
+
+ 
+
+To
+the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages
+of development or growth we may be affected by numerous risks inherent in such company or business. Although our management will endeavor
+to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant
+risk factors.
+
+ 
+
+In
+evaluating a prospective target business, we expect to conduct a thorough due diligence review which will encompass, among other things,
+meetings with incumbent management and employees, document reviews, inspection of facilities, as well as a review of financial, operational,
+legal and other information which will be made available to us.
+
+ 
+
+The
+time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs
+associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification
+and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in
+our incurring losses and will reduce the funds we can use to complete another business combination.
+
+ 
+
+ 87
+
+ Table of Contents
+
+ 
+
+ 
+
+Lack of
+Business Diversification
+
+ 
+
+For
+an indefinite period of time after the completion of our initial business combination, the prospects for our success may depend entirely
+on the future performance of a single business. Unlike other entities that may have the resources to complete business combinations with
+multiple entities in one or several industries, it is probable that we will not have the resources to diversify our operations and mitigate
+the risks of being in a single line of business. By completing our initial business combination with only a single entity, our lack of
+diversification may:
+
+ 
+
+ subject
+ us to negative economic, competitive and regulatory developments, any or all of which may
+ have a substantial adverse impact on the particular industry in which we operate after our
+ initial business combination; and
+
+ 
+
+ cause
+ us to depend on the marketing and sale of a single product or limited number of products
+ or services.
+
+ 
+
+Limited
+Ability to Evaluate the Target s Management Team
+
+ 
+
+Although
+we intend to closely scrutinize the management of a prospective target business when evaluating the desirability of effecting our initial
+business combination with that business, our assessment of the target business s management may not prove to be correct. In addition,
+the future management may not have the necessary skills, qualifications or abilities to manage a public company. Furthermore, the future
+role of members of our management team, if any, in the target business cannot presently be stated with any certainty. While it is possible
+that one or more of our directors will remain associated in some capacity with us following our initial business combination, it is unlikely
+that any of them will devote their full efforts to our affairs subsequent to our initial business combination. Moreover, we cannot assure
+you that members of our management team will have significant experience or knowledge relating to the operations of the particular target
+business.
+
+ 
+
+We
+cannot assure you that any of our key personnel will remain in senior management or advisory positions with the combined company. The
+determination as to whether any of our key personnel will remain with the combined company will be made at the time of our initial business
+combination.
+
+ 
+
+Following
+a business combination, we may seek to recruit additional managers to supplement the incumbent management of the target business. We
+cannot assure you that we will have the ability to recruit additional managers, or that such additional managers will have the requisite
+skills, knowledge or experience necessary to enhance the incumbent management.
+
+ 
+
+Shareholders
+May Not Have the Ability to Approve Our Initial Business Combination
+
+ 
+
+We
+may conduct redemptions without a shareholder vote pursuant to the tender offer rules of the SEC subject to the provisions of our
+amended and restated memorandum and articles of association. However, we will seek shareholder approval if it is required by law or applicable
+stock exchange rule, or we may decide to seek shareholder approval for business or other legal reasons.
+
+ 
+
+Under
+the NASDAQ s listing rules, shareholder approval would be required for our initial business combination if, for example:
+
+ 
+
+ we
+ issue ordinary shares that will be equal to or in excess of 20% of the number of ordinary
+ shares then issued and outstanding (other than in a public offering);
+
+ 
+
+ any
+ of our directors, officers or substantial shareholders (as defined by NASDAQ rules) has a
+ 5% or greater interest (or such persons collectively have a 10% or greater interest), directly
+ or indirectly, in the target business or assets to be acquired or otherwise and the present
+ or potential issuance of ordinary shares could result in an increase in issued and outstanding
+ ordinary shares or voting power of 5% or more; or
+
+ 
+
+ the
+ issuance or potential issuance of ordinary shares will result in our undergoing a change
+ of control.
+
+ 
+
+ 88
+
+ Table of Contents
+
+ 
+
+ 
+
+Permitted
+Purchases of Our Securities
+
+ 
+
+In
+the event we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial
+business combination pursuant to the tender offer rules, our sponsor, directors, officers, advisors or their affiliates may purchase
+shares in privately negotiated transactions or in the open market either prior to or following the completion of our initial business
+combination. There is no limit on the number of shares such persons may purchase. However, they have no current commitments, plans or
+intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. In the event our
+sponsor, directors, officers, advisors or their affiliates determine to make any such purchases at the time of a shareholder vote relating
+to our initial business combination, such purchases could have the effect of influencing the vote necessary to approve such transaction.
+None of the funds in the trust account will be used to purchase shares in such transactions. They will not make any such purchases when
+they are in possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by Regulation
+M under the Exchange Act. Such a purchase may include a contractual acknowledgement that such shareholder, although still the record
+holder of our shares is no longer the beneficial owner thereof and therefore agrees not to exercise its redemption rights. Subsequent
+to the consummation of this offering, we will adopt an insider trading policy which will require insiders to: (i) refrain from purchasing
+shares during certain blackout periods and when they are in possession of any material non-public information and (ii) to clear
+all trades with our legal counsel prior to execution. We cannot currently determine whether our insiders will make such purchases pursuant
+to a Rule 10b5-1 plan, as it will be dependent upon several factors, including but not limited to, the timing and size of such purchases.
+Depending on such circumstances, our insiders may either make such purchases pursuant to a Rule 10b5-1 plan or determine that such
+a plan is not necessary.
+
+ 
+
+In
+the event that our sponsor, directors, officers, advisors or their affiliates purchase shares in privately negotiated transactions from
+public shareholders who have already elected to exercise their redemption rights, such selling shareholders would be required to revoke
+their prior elections to redeem their shares. We do not currently anticipate that such purchases, if any, would constitute a tender offer
+subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under
+the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules,
+the purchasers will comply with such rules.
+
+ 
+
+The
+purpose of such purchases would be to (i) vote such shares in favor of the business combination and thereby increase the likelihood
+of obtaining shareholder approval of the business combination or (ii) to satisfy a closing condition in an agreement with a target
+that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it
+appears that such requirement would otherwise not be met. This may result in the completion of our initial business combination that
+may not otherwise have been possible.
+
+ 
+
+In
+addition, if such purchases are made, the public "float" of our ordinary shares may be reduced and the number of beneficial
+holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our
+securities on a national securities exchange.
+
+ 
+
+Our
+sponsor, officers, directors, advisors and/or their affiliates anticipate that they may identify the shareholders with whom our sponsor,
+officers, directors, advisors or their affiliates may pursue privately negotiated purchases by either the shareholders contacting us
+directly or by our receipt of redemption requests submitted by shareholders following our mailing of proxy materials in connection with
+our initial business combination. To the extent that our sponsor, officers, directors or their affiliates enter into a private purchase,
+they would identify and contact only potential selling shareholders who have expressed their election to redeem their shares for a pro
+rata share of the trust account or vote against the business combination. Such persons would select the shareholders from whom to acquire
+shares based on the number of shares available, the negotiated price per share and such other factors as any such person may deem relevant
+at the time of purchase. The price per share paid in any such transaction may be different than the amount per share a public shareholder
+would receive if it elected to redeem its shares in connection with our initial business combination. Our sponsor, officers, directors,
+advisors or their affiliates will only purchase shares if such purchases comply with Regulation M under the Exchange Act and the other
+federal securities laws.
+
+ 
+
+Any
+purchases by our sponsor, officers, directors, advisors and/or their affiliates who are affiliated purchasers under Rule 10b-18
+under the Exchange Act will only be made to the extent such purchases are able to be made in compliance with Rule 10b-18, which
+is a safe harbor from liability for manipulation under Section 9(a)(2) and Rule 10b-5 of the Exchange Act. Rule 10b-18
+has certain technical requirements that must be complied with in order for the safe harbor to be available to the purchaser. Our sponsor,
+officers, directors, advisors and/or their affiliates will not make purchases of ordinary shares if the purchases would violate Section 9(a)(2) or
+Rule 10b-5 of the Exchange Act.
+
+ 
+
+ 89
+
+ Table of Contents
+
+ 
+
+ 
+
+Ability
+to Extend Time to Complete Business Combination
+
+ 
+
+We
+will have until 9 months from the closing of this offering to consummate our initial business combination. However, if we anticipate
+that we may not be able to consummate our initial business combination within 9 months, we may, by resolution of our board if requested
+by our sponsor, extend the period of time to consummate a business combination up to twelve times, each by an additional one month (for
+a total of up to 21 months to complete a business combination), subject to the sponsor depositing additional funds into the trust account
+as set out below. Pursuant to the terms of our memorandum and articles of association and the trust agreement to be entered into between
+us and Vstock Transfer LLC on the date of this prospectus, in order for the time available for us to consummate our initial business
+combination to be extended, our sponsor or its affiliates or designees, upon five days advance notice prior to the applicable deadline,
+must deposit into the trust account $333,333, or $383,332 if the underwriters over-allotment option is exercised in full (approximately
+$0.033 per public share in either case), up to an aggregate of $4,000,000 (or $4,600,000 if the underwriters over-allotment option
+is exercised in full), or $0.40 per public share (for the entire 12 month period), on or prior to the date of the applicable deadline,
+for each extension. In the event that we receive notice from our sponsor five days prior to the applicable deadline of its wish for us
+to effect an extension, we intend to issue a press release announcing such intention at least three days prior to the applicable deadline.
+In addition, we intend to issue a press release the day after the applicable deadline announcing whether or not the funds had been timely
+deposited. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete
+our initial business combination.
+
+ 
+
+Our
+sponsor may extend the time frame for us to complete a business combination by up to an additional 12 months contingent upon our sponsor
+timely depositing the required amount of funds for each monthly extension. Holders of our securities will not have to right to approve
+or disapprove any such monthly extension. Further, holders of our securities will not have the right to seek or obtain redemption in
+connection with any extension of the time frame.
+
+ 
+
+Any
+such payments from our sponsor to extend the time frame would be made in the form of a loan from our sponsor. The final and definitive
+terms of the loan in connection with any such loans have not yet been negotiated, but any such loan would be interest free and not repaid
+unless and until we complete a business combination. If we complete our initial business combination, we would expect to repay such loaned
+amounts out of the proceeds of the trust account released to us or from funds which may be raised in any subsequent capital financing
+transaction which may be undertaken in connection with the completion of a business combination.
+
+ 
+
+Redemption
+Rights for Public Shareholders upon Completion of Our Initial Business Combination
+
+ 
+
+We
+will provide our public shareholders with the opportunity to redeem all or a portion of their ordinary shares upon the completion of
+our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account
+as of two business days prior to the consummation of the initial business combination, including interest (which interest shall be net
+of taxes payable) divided by the number of then issued and outstanding public shares, subject to the limitations described herein. The
+amount in the trust account is initially anticipated to be approximately $10.00 per public share (subject to increase of up to an additional
+$0.40 per public share in the event that our sponsor elects to extend the period of time to consummate a business combination, as described
+in more detail in this prospectus). The per-share amount we will distribute to investors who properly redeem their shares will not be
+reduced by the deferred underwriting commissions we will pay to the underwriters. Our sponsor, officers and directors have entered into
+a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares,
+private placement shares and any public shares they may hold in connection with the completion of our initial business combination.
+
+ 
+
+ 90
+
+ Table of Contents
+
+ 
+
+ 
+
+Manner
+of Conducting Redemptions
+
+ 
+
+We
+will provide our public shareholders with the opportunity to redeem all or a portion of their ordinary shares upon the completion of
+our initial business combination either (i) in connection with a shareholder meeting called to approve the business combination
+or (ii) by means of a tender offer. Shareholders will not be granted any right to redeem their securities in connection with any
+decision by us to extend the time frame to complete a business combination from 9 months to up to 21 months. The decision as to whether
+we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion,
+and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require
+us to seek shareholder approval under the law or stock exchange listing requirement. Under NASDAQ rules, asset acquisitions and stock
+purchases would not typically require shareholder approval while direct mergers with our company where we do not survive and any transactions
+where we issue more than 20% of our issued and outstanding ordinary shares or seek to amend our amended and restated memorandum and articles
+of association would require shareholder approval. We intend to conduct redemptions without a shareholder vote pursuant to the tender
+offer rules of the SEC unless shareholder approval is required by law or stock exchange listing requirement or we choose to seek
+shareholder approval for business or other legal reasons. So long as we obtain and maintain a listing for our securities on the NASDAQ,
+we will be required to comply with NASDAQ rules.
+
+ 
+
+If
+a shareholder vote is not required and we do not decide to hold a shareholder vote for business or other legal reasons, we will, pursuant
+to our amended and restated memorandum and articles of association:
+
+ 
+
+ conduct
+ the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which
+ regulate issuer tender offers; and
+
+ 
+
+ file
+ tender offer documents with the SEC prior to completing our initial business combination
+ which contain substantially the same financial and other information about the initial business
+ combination and the redemption rights as is required under Regulation 14A of the Exchange
+ Act, which regulates the solicitation of proxies.
+
+ 
+
+Upon
+the public announcement of our initial business combination, we or our sponsor will terminate any plan established in accordance with
+Rule 10b5-1 to purchase our ordinary shares in the open market if we elect to redeem our public shares through a tender offer, to
+comply with Rule 14e-5 under the Exchange Act.
+
+ 
+
+In
+the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days,
+in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination
+until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering
+more than a specified number of public shares which are not purchased by our sponsor, which number will be based on the requirement that
+we may not redeem public shares in an amount that would cause our net tangible assets, after payment of the deferred underwriting commissions,
+to be less than $5,000,001 upon consummation of our initial business combination (so that we are not subject to the SEC s "penny
+stock" rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial
+business combination. If public shareholders tender more shares than we have offered to purchase, we will withdraw the tender offer and
+not complete the initial business combination.
+
+ 
+
+If,
+however, shareholder approval of the transaction is required by law or stock exchange listing requirement, or we decide to obtain shareholder
+approval for business or other legal reasons, we will, pursuant to our amended and restated memorandum and articles of association:
+
+ 
+
+ conduct
+ the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the
+ Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender
+ offer rules; and
+
+ 
+
+ file
+ proxy materials with the SEC.
+
+ 
+
+ 91
+
+ Table of Contents
+
+ 
+
+ 
+
+We
+expect that a final proxy statement would be mailed to public shareholders at least 10 days prior to the shareholder vote. However, because
+we are subject to the SEC s reporting rules and therefore will be required to file a preliminary proxy statement, we expect that
+a draft proxy statement would be made available to such shareholders well in advance of such time, providing additional notice of redemption
+if we conduct redemptions in conjunction with a proxy solicitation. Although we are not required to do so, we currently intend to comply
+with the substantive and procedural requirements of Regulation 14A in connection with any shareholder vote even if we are not able to
+maintain our NASDAQ listing or Exchange Act registration.
+
+ 
+
+In
+the event that we seek shareholder approval of our initial business combination, we will distribute proxy materials and, in connection
+therewith, provide our public shareholders with the redemption rights described above upon completion of the initial business combination.
+
+ 
+
+If
+we seek shareholder approval, we will complete our initial business combination only if a majority of the issued and outstanding ordinary
+shares voted are voted in favor of the business combination. In such case, pursuant to the terms of a letter agreement entered into with
+us, our sponsor, officers and directors have agreed (and their permitted transferees will agree) to vote any founder shares and private
+placement shares held by them and any public shares purchased during or after this offering in favor of our initial business combination.
+We expect that at the time of any shareholder vote relating to our initial business combination, our sponsor and its permitted transferees
+will own approximately 21.88% of our issued and outstanding ordinary shares entitled to vote thereon (assuming it does not purchase units
+in this offering, and taking into account ownership of the private placement units). Each public shareholder may elect to redeem their
+public shares irrespective of whether they vote for or against the proposed transaction. In addition, our sponsor, officers and directors
+have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their
+founder shares, private placement shares and public shares in connection with the completion of a business combination.
+
+ 
+
+Our
+amended and restated memorandum and articles of association will provide that in no event will we redeem our public shares in an amount
+that would cause our net tangible assets to be less than $5,000,001 upon consummation of our initial business combination (so that we
+are not subject to the SEC s "penny stock" rules). Redemptions of our public shares may also be subject to a higher
+net tangible asset test or cash requirement pursuant to an agreement relating to our initial business combination. For example, the proposed
+business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred
+to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions
+in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration we would be required
+to pay for all ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant
+to the terms of the proposed business combination (and any funds from any possible capital raising transaction which we may undertake)
+exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all ordinary
+shares submitted for redemption will be returned to the holders thereof.
+
+ 
+
+Limitation
+on Redemption upon Completion of Our Initial Business Combination if We Seek Shareholder Approval
+
+ 
+
+Notwithstanding
+the foregoing, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with
+our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association
+will provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder
+is acting in concert or as a "group" (as defined under Section 13 of the Exchange Act), will be restricted from seeking
+redemption rights with respect to Excess Shares. We believe this restriction will discourage shareholders from accumulating large blocks
+of shares, and subsequent attempts by such holders to use their ability to exercise their redemption rights against a proposed business
+combination as a means to force us or our sponsor or its affiliates to purchase their shares at a significant premium to the then-current
+market price or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the
+shares sold in this offering could threaten to exercise its redemption rights if such holder s shares are not purchased by us or
+our sponsor or its affiliates at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders 
+ability to redeem no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of shareholders
+to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business
+combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However,
+we would not be restricting our shareholders ability to vote all of their shares (including Excess Shares) for or against our
+initial business combination. Our sponsor, officers and directors have, pursuant to a letter agreement entered into with us, waived their
+right to have any founder shares or public shares held by them redeemed in connection with our initial business combination. Unless any
+of our other affiliates acquires founder shares through a permitted transfer from an initial shareholder, and thereby becomes subject
+to the letter agreement, no such affiliate is subject to this waiver. However, to the extent any such affiliate acquires public shares
+in this offering or thereafter through open market purchases, it would be a public shareholder and restricted from seeking redemption
+rights with respect to any Excess Shares.
+
+ 
+
+ 92
+
+ Table of Contents
+
+ 
+
+ 
+
+Tendering
+Share Certificates in Connection with a Tender Offer or Redemption Rights
+
+ 
+
+We
+may require our public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their shares
+in "street name," to either tender their certificates (if any) to our transfer agent prior to the date set forth in the tender
+offer documents, or up to two business days prior to the vote on the proposal to approve the business combination in the event we distribute
+proxy materials, or to deliver their shares to the transfer agent electronically using The Depository Trust Company s DWAC (Deposit/
+Withdrawal At Custodian) System, rather than simply voting against the initial business combination. The tender offer or proxy materials,
+as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate
+whether we are requiring public shareholders to satisfy such delivery requirements. Accordingly, a public shareholder would have from
+the time we send out our tender offer materials until the close of the tender offer period, or up to two days prior to the vote on the
+business combination if we distribute proxy materials, as applicable, to tender its shares if it wishes to seek to exercise its redemption
+rights. Pursuant to the tender offer rules, the tender offer period will be not less than 20 business days and, in the case of a shareholder
+vote, a final proxy statement would be mailed to public shareholders at least 10 days prior to the shareholder vote. However, we expect
+that a draft proxy statement would be made available to such shareholders well in advance of such time, providing additional notice of
+redemption if we conduct redemptions in conjunction with a proxy solicitation. Given the relatively short exercise period, it is advisable
+for shareholders to use electronic delivery of their public shares.
+
+ 
+
+There
+is a nominal cost associated with the above-referenced tendering process and the act of certificating the shares or delivering them through
+the DWAC System. The transfer agent will typically charge the tendering broker $80.00 and it would be up to the broker whether or not
+to pass this cost on to the redeeming holder. However, this fee would be incurred regardless of whether or not we require holders seeking
+to exercise redemption rights to tender their shares. The need to deliver shares is a requirement of exercising redemption rights regardless
+of the timing of when such delivery must be effectuated.
+
+ 
+
+The
+foregoing is different from the procedures used by many blank check companies. In order to perfect redemption rights in connection with
+their business combinations, many blank check companies would distribute proxy materials for the shareholders vote on an initial
+business combination, and a holder could simply vote against a proposed business combination and check a box on the proxy card indicating
+such holder was seeking to exercise his or her redemption rights. After the business combination was approved, the company would contact
+such shareholder to arrange for him or her to deliver his or her certificate to verify ownership. As a result, the shareholder then had
+an "option window" after the completion of the business combination during which he or she could monitor the price of the
+company s shares in the market. If the price rose above the redemption price, he or she could sell his or her shares in the open
+market before actually delivering his or her shares to the company for cancellation. As a result, the redemption rights, to which shareholders
+were aware they needed to commit before the shareholder meeting, would become "option" rights surviving past the completion
+of the business combination until the redeeming holder delivered its certificate. The requirement for physical or electronic delivery
+prior to the meeting ensures that a redeeming holder s election to redeem is irrevocable once the business combination is approved.
+
+ 
+
+Any
+request to redeem such shares, once made, may be withdrawn at any time up to the date set forth in the tender offer materials or the
+date of the shareholder meeting set forth in our proxy materials, as applicable. Furthermore, if a holder of a public share delivered
+its certificate in connection with an election of redemption rights and subsequently decides prior to the applicable date not to elect
+to exercise such rights, such holder may simply request that the transfer agent return the certificate (physically or electronically).
+It is anticipated that the funds to be distributed to holders of our public shares electing to redeem their shares will be distributed
+promptly after the completion of our initial business combination.
+
+ 
+
+If
+our initial business combination is not approved or completed for any reason, then our public shareholders who elected to exercise their
+redemption rights would not be entitled to redeem their shares for the applicable pro rata share of the trust account. In such case,
+we will promptly return any certificates delivered by public holders who elected to redeem their shares.
+
+ 
+
+If
+our initial proposed business combination is not completed, we may continue to try to complete a business combination with a different
+target until 9 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period
+of time to consummate a business combination, as described in more detail in this prospectus).
+
+ 
+
+ 93
+
+ Table of Contents
+
+ 
+
+ 
+
+Redemption
+of Public Shares and Liquidation if No Initial Business Combination
+
+ 
+
+Our
+sponsor, officers and directors have agreed that we will have only 9 months from the closing of this offering (or up to 21 months from
+the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this
+prospectus) to complete our initial business combination. If we are unable to complete our initial business combination within such 9-month
+(or up to 21-month) time period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as
+reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash,
+equal to the aggregate amount then on deposit in the trust account, including interest (less up to $50,000 of interest to pay dissolution
+expenses (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares, which redemption
+will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions,
+if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval
+of our remaining shareholders and our Board of Directors, liquidate and dissolve, subject in each case to our obligations under Cayman
+Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating
+distributions with respect to our warrants or rights, which will expire worthless if we fail to complete our initial business combination
+within the 9-month (or up to 21-month) time period.
+
+ 
+
+Our
+sponsor may extend the time frame for us to complete a business combination by up to an additional twelve (12) months contingent upon
+our sponsor timely depositing into the trust account the required amount of funds for each monthly extension. Holders of our securities
+will not have to right to approve or disapprove any such monthly extension. Further, holders of our securities will not have the right
+to seek or obtain redemption in connection with any extension of the time frame to complete a business combination.
+
+ 
+
+Any
+such payments from our sponsor to extend the time frame would be made in the form of a loan from our sponsor. The final and definitive
+terms of the loan in connection with any such loans have not yet been negotiated, but any such loan would be interest free and not repaid
+unless and until we complete a business combination. If we complete our initial business combination, we would expect to repay such loaned
+amounts out of the proceeds of the trust account released to us or from funds which may be raised in any subsequent capital financing
+transaction which may be undertaken in connection with the completion of a business combination.
+
+ 
+
+Our
+sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating
+distributions from the trust account with respect to their founder shares and private placement shares if we fail to complete our initial
+business combination within 9 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend
+the period of time to consummate a business combination, as described in more detail in this prospectus). However, if our sponsor acquires
+public shares after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public
+shares if we fail to complete our initial business combination within the allotted 9 month (or up to 21 month) time period.
+
+ 
+
+Our
+sponsor, officers and directors have agreed, pursuant to a written letter agreement with us, that they will not propose any amendment
+to our amended and restated memorandum and articles of association that would (i) modify the substance or timing of our obligation
+to redeem 100% of our public shares if we do not complete our initial business combination within 9 months from the closing of this offering
+(or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination, as described
+in more detail in this prospectus) or (ii) with respect to the other provisions relating to shareholders rights or pre-business
+combination activity, unless we provide our public shareholders with the opportunity to redeem their ordinary shares upon approval of
+any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including
+interest (which interest shall be net of taxes payable) divided by the number of then issued and outstanding public shares. However,
+we may not redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 upon consummation
+of our initial business combination (so that we are not subject to the SEC s "penny stock" rules). If this optional
+redemption right is exercised with respect to an excessive number of public shares such that we cannot satisfy the net tangible asset
+requirement (described above), we would not proceed with the amendment or the related redemption of our public shares.
+
+ 
+
+ 94
+
+ Table of Contents
+
+ 
+
+ 
+
+We
+expect that all costs and expenses associated with implementing our plan of dissolution, as well as payments to any creditors, will be
+funded from amounts remaining out of the $500,000 of proceeds held outside the trust account, although we cannot assure you that there
+will be sufficient funds for such purpose. However, if those funds are not sufficient to cover the costs and expenses associated with
+implementing our plan of dissolution, to the extent that there is any interest accrued in the trust account not required to pay taxes,
+we may request the trustee to release to us an additional amount of up to $50,000 of such accrued interest to pay those costs and expenses.
+
+ 
+
+If
+we were to expend all of the net proceeds of this offering and the sale of the private placement units, other than the proceeds deposited
+in the trust account, and without taking into account interest, if any, earned on the trust account, the per-share redemption amount
+received by shareholders upon our dissolution would be approximately $10.00 (subject to increase of up to an additional $0.40 per public
+share in the event that our sponsor elects to extend the period of time to consummate a business combination, as described in more detail
+in this prospectus). The proceeds deposited in the trust account could, however, become subject to the claims of our creditors which
+would have higher priority than the claims of our public shareholders. We cannot assure you that the actual per-share redemption amount
+received by shareholders will not be substantially less than $10.00. While we intend to pay such amounts, if any, we cannot assure you
+that we will have funds sufficient to pay or provide for all creditors claims.
+
+ 
+
+Although
+we will seek to have all vendors, service providers, prospective target businesses or other entities with which we do business execute
+agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the trust account for the benefit
+of our public shareholders, there is no guarantee that they will execute such agreements or even if they execute such agreements that
+they would be prevented from bringing claims against the trust account including but not limited to fraudulent inducement, breach of
+fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order
+to gain an advantage with respect to a claim against our assets, including the funds held in the trust account. If any third party refuses
+to execute an agreement waiving such claims to the monies held in the trust account, our management will perform an analysis of the alternatives
+available to it and will only enter into an agreement with a third party that has not executed a waiver if management believes that such
+third party s engagement would be significantly more beneficial to us than any alternative. Examples of possible instances where
+we may engage a third party that refuses to execute a waiver include the engagement of a third party consultant whose particular expertise
+or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver
+or in cases where management is unable to find a service provider willing to execute a waiver. In addition, there is no guarantee that
+such entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts
+or agreements with us and will not seek recourse against the trust account for any reason. Upon redemption of our public shares, if we
+are unable to complete our initial business combination within the prescribed time frame, or upon the exercise of a redemption right
+in connection with our initial business combination, we will be required to provide for payment of claims of creditors that were not
+waived that may be brought against us within the 10 years following redemption. Our sponsor has agreed that it will be liable to us if
+and to the extent any claims by a vendor for services rendered or products sold to us, or a prospective target business with which we
+have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (i) $10.00 per public
+share or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account,
+due to reductions in value of the trust assets, in each case net of the amount of interest which may be withdrawn to pay taxes, except
+as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any
+claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities
+Act. In the event that an executed waiver is deemed to be unenforceable against a third party, then our sponsor will not be responsible
+to the extent of any liability for such third-party claims. We have not independently verified whether our sponsor has sufficient funds
+to satisfy their indemnity obligations and believe that our sponsor s only assets are securities of our company. None of our other
+officers will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses.
+
+ 
+
+ 95
+
+ Table of Contents
+
+ 
+
+ 
+
+In
+the event that the proceeds in the trust account are reduced below (i) $10.00 per public share or (ii) such lesser amount per
+public share held in the trust account as of the date of the liquidation of the trust account, due to reductions in value of the trust
+assets, in each case net of the amount of interest which may be withdrawn to pay taxes, and our sponsor asserts that it is unable to
+satisfy its indemnification obligations or that it has no indemnification obligations related to a particular claim, our independent
+directors would determine whether to take legal action against our sponsor to enforce its indemnification obligations. While we currently
+expect that our independent directors would take legal action on our behalf against our sponsor to enforce its indemnification obligations
+to us, it is possible that our independent directors in exercising their business judgment may choose not to do so in any particular
+instance. Accordingly, we cannot assure you that due to claims of creditors the actual value of the per-share redemption price will not
+be substantially less than $10.00 per share.
+
+ 
+
+We
+will seek to reduce the possibility that our sponsor will have to indemnify the trust account due to claims of creditors by endeavoring
+to have all vendors, service providers, prospective target businesses or other entities with which we do business execute agreements
+with us waiving any right, title, interest or claim of any kind in or to monies held in the trust account. Our sponsor will also not
+be liable as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities
+under the Securities Act. We will have access to up to $100,000,000 from the proceeds of this offering and the sale of the private placement
+units, with which to pay any such potential claims (including costs and expenses incurred in connection with our liquidation, currently
+estimated to be no more than approximately $50,000). In the event that we liquidate and it is subsequently determined that the reserve
+for claims and liabilities is insufficient, shareholders who received funds from our trust account could be liable for claims made by
+creditors. In the event that our offering expenses exceed our estimate of $500,000, we may fund such excess with funds from the funds
+not to be held in the trust account. In such case, the amount of funds we intend to be held outside the trust account would decrease
+by a corresponding amount. Conversely, in the event that the offering expenses are less than our estimate of $500,000, the amount of
+funds we intend to be held outside the trust account would increase by a corresponding amount.
+
+ 
+
+If
+we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, the proceeds held in the
+trust account could be subject to applicable bankruptcy law, and may be included in our bankruptcy estate and subject to the claims of
+third parties with priority over the claims of our shareholders. To the extent any bankruptcy claims deplete the trust account, we cannot
+assure you we will be able to return $10.00 per share to our public shareholders. Additionally, if we file a bankruptcy petition or an
+involuntary bankruptcy petition is filed against us that is not dismissed, any distributions received by shareholders could be viewed
+under applicable debtor/creditor and/or bankruptcy laws as either a "preferential transfer" or a "fraudulent conveyance."
+As a result, a bankruptcy court could seek to recover all amounts received by our shareholders. Furthermore, our board may be viewed
+as having breached its fiduciary duty to our creditors and/or may have acted in bad faith, and thereby exposing itself and our company
+to claims of punitive damages, by paying public shareholders from the trust account prior to addressing the claims of creditors. We cannot
+assure you that claims will not be brought against us for these reasons.
+
+ 
+
+Our
+public shareholders will be entitled to receive funds from the trust account only upon the earlier of (i) the completion of our
+initial business combination, (ii) the redemption of any public shares properly tendered in connection with a shareholder vote to
+amend our amended and restated memorandum and articles of association to (A) modify the substance or timing of our obligation to
+redeem 100% of our public shares if we do not complete our initial business combination within 9 months from the closing of this offering
+(or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination, as described
+in more detail in this prospectus) or (B) with respect to any other provision relating to shareholders rights or pre-business
+combination activity and (iii) the redemption of all of our public shares if we are unable to complete our initial business combination
+within 9 months from the closing of this offering (or up to 21 months from the closing of this offering if we extend the period of time
+to consummate a business combination, as described in more detail in this prospectus), subject to applicable law. In no other circumstances
+will a shareholder have any right or interest of any kind to or in the trust account. In the event we seek shareholder approval in connection
+with our initial business combination, a shareholder s voting in connection with the business combination alone will not result
+in a shareholder s redeeming its shares to us for an applicable pro rata share of the trust account. Such shareholder must have
+also exercised its redemption rights described above.
+
+ 
+
+ 96
+
+ Table of Contents
+
+ 
+
+ 
+
+Amended
+and Restated Memorandum and Articles of Association
+
+ 
+
+Our
+amended and restated memorandum and articles of association will contain certain requirements and restrictions relating to this offering
+that will apply to us until the consummation of our initial business combination. If we seek to amend any provisions of our amended and
+restated memorandum and articles of association relating to shareholders rights or pre-business combination activity, we will
+provide dissenting public shareholders with the opportunity to redeem their public shares in connection with any such vote. Our sponsor,
+officers and directors have agreed to waive any redemption rights with respect to their founder shares, private placement shares and
+public shares in connection with the completion of our initial business combination. Specifically, our amended and restated memorandum
+and articles of association will provide, among other things, that:
+
+ 
+
+ prior
+ to the consummation of our initial business combination, we shall either (1) seek shareholder
+ approval of our initial business combination at a meeting called for such purpose at which
+ shareholders may seek to redeem their shares, regardless of whether they vote for or against
+ the proposed business combination, into their pro rata share of the aggregate amount then
+ on deposit in the trust account, including interest (which interest shall be net of taxes
+ payable) or (2) provide our public shareholders with the opportunity to tender their
+ shares to us by means of a tender offer (and thereby avoid the need for a shareholder vote)
+ for an amount equal to their pro rata share of the aggregate amount then on deposit in the
+ trust account, including interest (which interest shall be net of taxes payable) in each
+ case subject to the limitations described herein;
+
+ 
+
+ 
+ 
+ 
+ we
+ will consummate our initial business combination only if we have net tangible assets of at least $5,000,001 upon such consummation
+ and, solely if we seek shareholder approval, a majority of the issued and outstanding ordinary shares voted are voted in favor of
+ the business combination;
+
+ 
+
+ 
+
+ if
+ our initial business combination is not consummated within 9 months from the closing of this
+ offering (or up to 21 months from the closing of this offering if we extend the period of
+ time to consummate a business combination, as described in more detail in this prospectus),
+ then our existence will terminate and we will distribute all amounts in the trust account;
+ and
+
+ 
+
+ prior
+ to our initial business combination, we may not issue additional ordinary shares that would
+ entitle the holders thereof to (i) receive funds from the trust account or (ii) vote
+ on any initial business combination.
+
+ 
+
+These
+provisions cannot be amended without the approval of holders of at least two-thirds of our ordinary shares. In the event we seek shareholder
+approval in connection with our initial business combination, our amended and restated memorandum and articles of association will provide
+that we may consummate our initial business combination only if approved by a majority of the ordinary shares voted by our shareholders
+at a duly held shareholders meeting.
+
+ 
+
+Comparison
+of Redemption or Purchase Prices in Connection with Our Initial Business Combination and if We Fail to Complete Our Initial Business
+Combination.
+
+ 
+
+The
+following table compares the redemptions and other permitted purchases of public shares that may take place in connection with the completion
+of our initial business combination and if we are unable to complete our initial business combination within 9 months from the closing
+of this offering (or up to 21 months from the closing of this offering if we extend the period of time to consummate a business combination,
+as described in more detail in this prospectus).
+
+ 
+
+ 97
+
+ Table of Contents
+
+ 
+
+ 
+
+ 
+ 
+ Redemptions
+ in Connection 
+ with Our Initial Business 
+ Combination 
+ Other
+ Permitted Purchases 
+ of 
+ Public Shares by Our 
+ Affiliates 
+ Redemptions
+ if We Fail to 
+ Complete an Initial Business 
+ Combination
+
+ 
+ Calculation
+ of redemption price 
+ Redemptions
+ at the time of our initial business combination may be made pursuant to a tender offer or
+ in connection with a shareholder vote. The redemption price will be the same whether we conduct
+ redemptions pursuant to a tender offer or in connection with a shareholder vote. In either
+ case, our public shareholders may redeem their public shares for cash equal to the aggregate
+ amount then on deposit in the trust account as of two business days prior to the consummation
+ of the initial business combination (which is initially anticipated to be $10.00 per share
+ (subject to increase of up to an additional $0.40 per public share in the event that our
+ sponsor elects to extend the period of time to consummate a business combination, as described
+ in more detail in this prospectus)), including interest (which interest shall be net of taxes
+ payable) divided by the number of then issued and outstanding public shares, subject to the
+ limitation that no redemptions will take place if all of the redemptions would cause our
+ net tangible assets to be less than $5,000,001 upon consummation of our initial business
+ combination (so that we may avoid penny stock status under the SEC s Rule 419) and
+ any limitations (including but not limited to cash requirements) agreed to in connection
+ with the negotiation of terms of a proposed business combination.
+
+ 
+ If
+ we seek shareholder approval of our initial business combination, our sponsor, directors, officers, advisors or their affiliates
+ may purchase shares in privately negotiated transactions or in the open market either prior to or following completion of our initial
+ business combination. Such purchases will only be made to the extent such purchases are able to be made in compliance with Rule 10b-18,
+ which is a safe harbor from liability for manipulation under Section 9(a)(2) and Rule 10b-5 of the Exchange Act. None
+ of the funds in the trust account will be used to purchase shares in such transactions. 
+ If
+ we are unable to complete our initial business combination within 9 months from the closing of this offering (or up to 21 months
+ from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail
+ in this prospectus), we will redeem all public shares at a per-share price, payable in cash, equal to the aggregate amount then on
+ deposit in the trust account (which is initially anticipated to be $10.00 per share), including interest (less up to $50,000 of interest
+ to pay dissolution expenses, which interest shall be net of taxes payable) divided by the number of then issued and outstanding public
+ shares.
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Impact
+ to remaining shareholders 
+ The
+ redemptions in connection with our initial business combination will reduce the book value per share for our remaining shareholders,
+ who will bear the burden of the deferred underwriting commissions and interest withdrawn in order to pay taxes (to the extent not
+ paid from amounts accrued as interest on the funds held in the trust account). 
+ If
+ the permitted purchases described above are made, there will be no impact to our remaining shareholders because the purchase price
+ would not be paid by us. 
+ The
+ redemption of our public shares if we fail to complete our initial business combination will reduce the book value per share for
+ the shares held by our sponsor, who will be our only remaining shareholder after such redemptions.
+
+ 
+
+ 
+
+ 98
+
+ Table of Contents
+
+ 
+
+ 
+
+Comparison
+of This Offering to Those of Blank Check Companies Subject to Rule 419
+
+ 
+
+The
+following table compares the terms of this offering to the terms of an offering by a blank check company subject to the provisions of
+Rule 419. This comparison assumes that the gross proceeds, underwriting commissions and underwriting expenses of our offering would
+be identical to those of an offering undertaken by a company subject to Rule 419, and that the underwriters will not exercise their
+over-allotment option. None of the provisions of Rule 419 apply to our offering.
+
+ 
+
+ 
+ 
+ 
+ Terms
+ of Our Offering
+ 
+ Terms
+ Under a Rule 419 Offering
+
+ 
+ Escrow
+ of offering proceeds
+ 
+ The
+ NASDAQ rules provide that at least 90% of the gross proceeds from this offering and the private placement be deposited in a
+ trust account. $100,000,000 of the net proceeds of this offering and the sale of the private placement units will be deposited into
+ a U.S. trust account established by our transfer agent Vstock Transfer LLC with Wilmington Trust, National Association acting as
+ trustee.
+ 
+ Approximately
+ $85,500,000 of the offering proceeds, representing the gross proceeds of this offering less allowable underwriting commissions, expenses
+ and company deductions under Rule 419, would be required to be deposited into either an escrow account with an insured depositary
+ institution or in a separate bank account established by a broker-dealer in which the broker-dealer acts as trustee for persons having
+ the beneficial interests in the account.
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Investment
+ of net proceeds
+ 
+ $100,000,000
+ of the net offering proceeds and the sale of the private placement units held in trust will be invested only in U.S. government treasury
+ bills with a maturity of 180 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment
+ Company Act which invest only in direct U.S. government treasury obligations.
+ 
+ Proceeds
+ could be invested only in specified securities such as a money market fund meeting conditions of the Investment Company Act or in
+ securities that are direct obligations of, or obligations guaranteed as to principal or interest by, the United States.
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Receipt
+ of interest on escrowed funds
+ 
+ Interest
+ on proceeds from the trust account to be paid to shareholders is reduced by (i) any taxes paid or payable and (ii) in the
+ event of our liquidation for failure to complete our initial business combination within the allotted time, up to $100,000 of net
+ interest that may be released to us should we have no or insufficient working capital to fund the costs and expenses of our dissolution
+ and liquidation.
+ 
+ Interest
+ on funds in escrow account would be held for the sole benefit of investors, unless and only after the funds held in escrow were released
+ to us in connection with our completion of a business combination.
+
+ 
+ 
+ 
+ 
+ 
+
+ Limitation
+ on fair value or net assets of target business 
+ The
+ NASDAQ rules require that our initial business combination must be with one or more target businesses that together have an
+ aggregate fair market value equal to at least 80% of the balance in the trust account (less any deferred underwriting commissions
+ and taxes payable on interest earned) at the time of our signing a definitive agreement in connection with our initial business combination. 
+ The
+ fair value or net assets of a target business must represent at least 80% of the maximum offering proceeds.
+
+ 
+
+ 99
+
+ Table of Contents
+
+ 
+
+ 
+
+ 
+ 
+ Terms
+ of Our Offering 
+ Terms
+ Under a Rule 419 Offering
+
+ 
+ Trading
+ of securities issued 
+ The
+ units will begin trading on or promptly after the date of this prospectus. The ordinary shares, rights and warrants comprising the
+ units will begin separate trading on the 52nd day following the date of this prospectus unless Ladenburg Thalmann
+ informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described
+ below and having issued a press release announcing when such separate trading will begin. We will file the Current Report on Form 8-K
+ promptly after the closing of this offering, which is anticipated to take place three business days from the date of this prospectus.
+ If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K,
+ a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise
+ of the underwriters over-allotment option. 
+ No
+ trading of the units or the underlying ordinary shares, rights and warrants would be permitted until the completion of a business
+ combination. During this period, the securities would be held in the escrow or trust account.
+
+ 
+ 
+ 
+ 
+
+ 
+ Exercise
+ of public warrants 
+ The
+ public warrants cannot be exercised until the later of the completion of our initial business
+ combination or 12 months from the date of this prospectus. 
+ 
+ The
+ public warrants could be exercised prior to the completion of a business combination, but securities received and cash paid in connection
+ with the exercise would be deposited in the escrow or trust account. 
+
+ 
+ 
+ 
+ 
+
+ 
+ Election
+ to remain an investor 
+ We
+ will provide our public shareholders with the opportunity to redeem their public shares for
+ cash equal to their pro rata share of the aggregate amount then on deposit in the trust account
+ as of two business days prior to the consummation of our initial business combination, including
+ interest, which interest shall be net of taxes payable, upon the completion of our initial
+ business combination, subject to the limitations described herein. We may not be required
+ by law to hold a shareholder vote. If we are not required by law and do not otherwise decide
+ to hold a shareholder vote, we will, pursuant to our amended and restated memorandum and
+ articles of association, conduct the redemptions pursuant to the tender offer rules of
+ the SEC and file tender offer documents with the SEC which will contain substantially the
+ same financial and other information about the initial business combination and the redemption
+ rights as is required under the SEC s proxy rules. If, however, we hold a shareholder
+ vote, we will, like many blank check companies, offer to redeem shares in conjunction with
+ a proxy solicitation pursuant to the proxy rules and not pursuant to the tender offer
+ rules. Pursuant to the tender offer rules, the tender offer period will be not less than
+ 20 business days, and in the case of a shareholder vote, a final proxy statement would be
+ mailed to public shareholders at least 10 days prior to the shareholder vote. However, we
+ expect that a draft proxy statement would be made available to such shareholders well in
+ advance of such time, providing additional notice of redemption if we conduct redemptions
+ in conjunction with a proxy solicitation. If we seek shareholder approval, we will complete
+ our initial business combination only if a majority of the issued and outstanding ordinary
+ shares voted are voted in favor of the business combination
+ 
+ A
+ prospectus containing information pertaining to the business combination required by the SEC would be sent to each investor. Each
+ investor would be given the opportunity to notify the company in writing, within a period of no less than 20 business days and no
+ more than 45 business days from the effective date of a post-effective amendment to the company s registration statement, to
+ decide if he, she or it elects to remain a shareholder of the company or require the return of his, her or its investment. If the
+ company has not received the notification by the end of the 45th business day, funds and interest or dividends, if any,
+ held in the trust or escrow account are automatically returned to the shareholder. Unless a sufficient number of investors elect
+ to remain investors, all funds on deposit in the escrow account must be returned to all of the investors and none of the securities
+ are issued
+
+ 
+
+ 
+
+ 100
+
+ Table of Contents
+
+ 
+
+ 
+
+ 
+ 
+ Terms
+ of Our Offering 
+ Terms
+ Under a Rule 419 Offering
+
+ 
+ 
+ Additionally,
+ each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction. 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Business
+ combination deadline 
+ If
+ we are unable to complete an initial business combination within 9 months from the closing
+ of this offering (or provided that our sponsor deposits into the trust account additional
+ funds, up to 21 months from the closing of this offering if we extend the period of time
+ to consummate a business combination, as described in more detail in this prospectus), we
+ will (i) cease all operations except for the purpose of winding up, (ii) as promptly
+ as reasonably possible but not more than ten business days thereafter, redeem 100% of the
+ public shares, at a per-share price, payable in cash, equal to the aggregate amount then
+ on deposit in the trust account, including interest (which interest shall be net of taxes
+ payable and less up to $50,000 of interest to pay dissolution expenses) divided by the number
+ of then issued and outstanding public shares, which redemption will completely extinguish
+ public shareholders rights as shareholders (including the right to receive further
+ liquidation distributions, if any), subject to applicable law, and (iii) as promptly
+ as reasonably possible following such redemption, subject to the approval of our remaining
+ shareholders and our Board of Directors, liquidate and dissolve, subject in each case to
+ our obligations under Cayman Islands law to provide for claims of creditors and the requirements
+ of other applicable law.
+ 
+ If
+ an acquisition has not been completed within 18 months after the effective date of the company s registration statement, funds
+ held in the trust or escrow account are returned to investors.
+
+ 
+
+ 
+
+ 101
+
+ Table of Contents
+
+ 
+
+ 
+
+ 
+ 
+ Terms
+ of Our Offering 
+ Terms
+ Under a Rule 419 Offering
+
+ 
+ Release
+ of funds 
+ Except
+ with respect to interest earned on the funds held in the trust account that may be released
+ to us to pay our taxes, if any, the proceeds from this offering will not be released from
+ the trust account until the earliest of (i) the completion of our initial business combination,
+ (ii) the redemption of any public shares properly tendered in connection with a shareholder
+ vote to amend and restate our amended and restated memorandum and articles of association
+ to (A) modify the substance or timing of our obligation to redeem 100% of our public
+ shares if we do not complete our initial business combination within 9 months from the closing
+ of this offering (or up to 21 months from the closing of this offering if we extend the period
+ of time to consummate a business combination, as described in more detail in this prospectus)
+ or (B) with respect to any other provision relating to shareholders rights or
+ pre-business combination activity and (iii) the redemption of all of our public shares
+ if we are unable to complete our initial business combination within 9 months from the closing
+ of this offering (or up to 21 months from the closing of this offering if we extend the period
+ of time to consummate a business combination, as described in more detail in this prospectus),
+ subject to applicable law. The Company will instruct the Trustee to pay amounts from the
+ trust account directly to redeeming holders.
+ 
+ The
+ proceeds held in the escrow account are not released until the earlier of the completion of a business combination or the failure
+ to effect a business combination within the allotted time.
+
+ 
+ 
+ 
+ 
+
+ 
+ Limitation
+ on redemption rights of shareholders holding more than 15% of the shares sold in this offering if we hold a shareholder vote 
+ If
+ we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial
+ business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide
+ that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting
+ in concert or as a "group" (as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption
+ rights with respect Excess Shares (more than an aggregate of 15% of the shares sold in this offering). Our public shareholders 
+ inability to redeem Excess Shares will reduce their influence over our ability to complete our initial business combination and they
+ could suffer a material loss on their investment in us if they sell Excess Shares in open market transactions. 
+ Most
+ blank check companies provide no restrictions on the ability of shareholders to redeem shares based on the number of shares held
+ by such shareholders in connection with an initial business combination.
+
+ 
+
+ 
+
+ 102
+
+ Table of Contents
+
+ 
+
+ 
+
+ 
+ 
+ Terms
+ of Our Offering 
+ Terms
+ Under a Rule 419 Offering
+
+ 
+ Tendering
+ share certificates in connection with a tender offer or redemption rights 
+ We
+ may require our public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their shares
+ in "street name," to either tender their certificates (if any) to our transfer agent prior to the date set forth in the
+ tender offer documents or proxy materials mailed to such holders, or up to two business days prior to the vote on the proposal to
+ approve the business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically
+ using The Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option. The tender
+ offer or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business
+ combination will indicate whether we are requiring public shareholders to satisfy such delivery requirements. Accordingly, a public
+ shareholder would have from the time we send out our tender offer materials until the close of the tender offer period, or up to
+ two days prior to the vote on the business combination if we distribute proxy materials, as applicable, to tender its shares if it
+ wishes to seek to exercise its redemption rights. 
+ In
+ order to perfect redemption rights in connection with their business combinations, holders could vote against a proposed business
+ combination and check a box on the proxy card indicating such holders were seeking to exercise their redemption rights. After the
+ business combination was approved, the company would contact such shareholders to arrange for them to deliver their certificate to
+ verify ownership.
+
+ 
+
+ 
+
+Competition
+
+ 
+
+In
+identifying, evaluating and selecting a target business for our initial business combination, we may encounter intense competition from
+other entities having a business objective similar to ours, including other blank check companies, private equity groups and leveraged
+buyout funds, and operating businesses seeking strategic acquisitions. Many of these entities are well established and have extensive
+experience identifying and effecting business combinations directly or through affiliates. Moreover, many of these competitors possess
+greater financial, technical, human and other resources than us. Our ability to acquire larger target businesses will be limited by our
+available financial resources. This inherent limitation gives others an advantage in pursuing the acquisition of a target business. Furthermore,
+our obligation to pay cash in connection with our public shareholders who exercise their redemption rights may reduce the resources available
+to us for our initial business combination and our outstanding rights and warrants, and the future dilution they potentially represent,
+may not be viewed favorably by certain target businesses. Either of these factors may place us at a competitive disadvantage in successfully
+negotiating an initial business combination.
+
+ 
+
+Conflicts
+of Interest
+
+ 
+
+Each
+of our officers and directors presently has, and in the future any of our directors and our officers may have additional, fiduciary or
+contractual obligations to other entities pursuant to which such officer or director is or will be required to present acquisition opportunities
+to such entity. Accordingly, subject to his or her fiduciary duties under Cayman Islands law, if any of our officers or directors becomes
+aware of an acquisition opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations,
+he or she will need to honor his or her fiduciary or contractual obligations to present such acquisition opportunity to such entity,
+and only present it to us if such entity rejects the opportunity. Our amended and restated memorandum and articles of association will
+provide that, subject to his or her fiduciary duties under Cayman Islands law, we renounce our interest in any corporate opportunity
+offered to any officer or director unless such opportunity is expressly offered to such person solely in his or her capacity as a director
+or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be
+reasonable for us to pursue. We do not believe, however, that any fiduciary duties or contractual obligations of our directors or officers
+would materially undermine our ability to complete our business combination.
+
+ 
+
+ 103
+
+ Table of Contents
+
+ 
+
+ 
+
+Indemnity
+
+ 
+
+Our
+sponsor has agreed that it will be liable to us if and to the extent any claims by a vendor for services rendered or products sold to
+us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in
+the trust account to below (i) $10.00 per public share or (ii) such lesser amount per public share held in the trust account
+as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest
+which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access
+to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities,
+including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against
+a third party, our sponsor will not be responsible to the extent of any liability for such third party claims. We have not independently
+verified whether our sponsor has sufficient funds to satisfy their indemnity obligations and believe that our sponsor s only assets
+are securities of our company. We have not asked our sponsor to reserve for such obligations.
+
+ 
+
+Facilities
+
+ 
+
+We
+currently maintain our executive offices at 132 West 31st Street, First Floor, New York, New York 10001. The cost for this space is included
+in the $10,000 per month fee that we will pay an affiliate of our sponsor for office space, administrative and support services. We consider
+our current office space adequate for our current operations.
+
+ 
+
+Employees
+
+ 
+
+As
+of the effective date of this prospectus, we will have two officers. Members of our management team are not obligated to devote any specific
+number of hours to our matters but they intend to devote as much of their time as they deem necessary to our affairs until we have completed
+our initial business combination. The amount of time that our officers or any other members of our management team will devote in any
+time period will vary based on whether a target business has been selected for our initial business combination and the current stage
+of the business combination process.
+
+ 
+
+Periodic
+Reporting and Financial Information
+
+ 
+
+We
+will register our units, ordinary shares, rights and warrants under the Exchange Act and have reporting obligations, including the requirement
+that we file annual, quarterly and current reports with the SEC. In accordance with the requirements of the Exchange Act, our annual
+reports will contain financial statements audited and reported on by our independent registered public auditors.
+
+ 
+
+We
+will provide shareholders with audited financial statements of the prospective target business as part of the tender offer materials
+or proxy solicitation materials sent to shareholders to assist them in assessing the target business. These financial statements may
+be required to be prepared in accordance with, or be reconciled to, U.S. GAAP, or IFRS, depending on the circumstances and the historical
+financial statements may be required to be audited in accordance with the PCAOB. These financial statement requirements may limit the
+pool of potential target businesses we may acquire because some targets may be unable to provide such statements in time for us to disclose
+such statements in accordance with federal proxy rules and complete our initial business combination within the prescribed time
+frame. While this may limit the pool of potential acquisition candidates, we do not believe that this limitation will be material.
+
+ 
+
+ 104
+
+ Table of Contents
+
+ 
+
+ 
+
+ We
+will be required to evaluate our internal control procedures for the fiscal year ending December 31, 2023 as required by the Sarbanes-Oxley
+Act. Only in the event we are deemed to be a large accelerated filer or an accelerated filer will we be required to have our internal
+control procedures audited. A target company may not be in compliance with the provisions of the Sarbanes-Oxley Act regarding adequacy
+of their internal controls. The development of the internal controls of any such entity to achieve compliance with the Sarbanes-Oxley
+Act may increase the time and costs necessary to complete any such acquisition. 
+
+ 
+
+Prior
+to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities
+under Section 12 of the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange
+Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior
+or subsequent to the consummation of our initial business combination.
+
+ 
+
+We
+are an "emerging growth company," as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act.
+As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public
+companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor
+attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation
+in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive
+compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities
+less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more
+volatile.
+
+ 
+
+In
+addition, Section 107 of the JOBS Act also provides that an "emerging growth company" can take advantage of the extended
+transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards.
+In other words, an "emerging growth company" can delay the adoption of certain accounting standards until those standards
+would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period.
+
+ 
+
+We
+will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary
+of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which
+we are deemed to be a large accelerated filer, which means the market value of our ordinary shares that is held by non-affiliates exceeds
+$700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible
+debt securities during the prior three-year period. References herein to "emerging growth company" shall have the meaning
+associated with it in the JOBS Act.
+
+ 
+
+Legal
+Proceedings
+
+ 
+
+There
+is no material litigation, arbitration or governmental proceeding currently pending against us or any members of our management team
+in their capacity as such.
+
+ 
+
+ 105
+
+ Table of Contents
+
+ 
+
+ 
+
+MANAGEMENT
+
+ 
+
+Directors,
+Director Nominees and Officers
+
+ 
+
+Upon
+consummation of this offering, our directors and executive officers will be as follows:
+
+ 
+
+ 
+ Name
+ 
+ Age
+ 
+ Position
+
+ 
+ Man
+ Chak Leung
+ 
+ 43
+ 
+ Chief
+ Executive Officer and Director
+
+ 
+ Wenxi
+ He
+ 
+ 43
+ 
+ Chief
+ Financial Officer 
+
+ 
+ Zhuo
+ Wang
+ 
+ 34
+ 
+ Independent
+ Director
+
+ 
+ Zining
+ Jiang
+ 
+ 47
+ 
+ Independent
+ Director
+
+ 
+ Xinghua
+ Fan
+ 
+ 59
+ 
+ Independent
+ Director
+
+ 
+
+ 
+
+Mr. Man
+Chak Leung has served as our Chief Executive Officer since June 2021. Mr. Leung has been the President and a director of Verity
+Acquisition Corp. since May 2021. Since August 2019, he has been serving as the General Manager of China Seven Star Holdings Limited,
+an investment holding company focusing on consumer and healthcare sectors in China. Mr. Leung served as consultant to Silk Road Finance
+Corporation from May to December 2020. Mr. Leung served as Co-Head of Risk and Portfolio Management at China Minsheng Financial Holding
+Corporation Limited ("CM Financial") from 2017 to May 2019, a Hong Kong mainboard listed financial holding platform. He was
+responsible for all portfolio including primary and secondary, fixed income and other special situations including SPACs. Mr. Leung joined
+CM Financial in December 2016 from TPG Growth, a global mid-market private equity firm with over US$ 15 billion AUM, where he spent 10
+years as an investment professional specializing in Healthcare, Financial Services, TMT, Consumer and Education in Greater China and
+South East Asia. Prior to that, he was with the Hong Kong office of the Cathay Capital Group between 2001 to 2006. He has accumulated
+extensive transaction experience including investments into eToro, Masan Group, FPT, ShangPharma, NT Pharma, Ivy Education Group, Vinda
+Paper and Rayli Magazine. He has also served on the board of the Ivy Education Group, a K12 Education Group in China between September
+2015 to February 2017, CM SPC and CM Asset Management (Hongkong) Company Limited between July 2018 to May 2019 and CM International Financial
+Leasing Investment Holding Company Limited between January 2018 to November 2019. Mr. Leung holds a Bachelor of Business and Administration
+(Finance) from City University of Hong Kong.
+
+Ms.
+Wenxi He has served as our Chief Financial Officer since June 2021. She serves as Chief Investment Officer at Still Waters Green Technology
+Limited, an asset management company based in London, specializing in the development and management of renewable energy and power generation
+assets, since February 2019. Ms. He has over 15 years of experience in the investment banking industry. Prior to joining Still Waters
+Green Technology Limited, she served as the Managing Director and Global Head of Commodity Exchange Traded Products at Bank of America
+Merrill Lynch in London. She was responsible for initiating and executing strategic solutions and issuance, trading physical and synthetic
+commodity products, and managing portfolio assets in energy, metals and agriculture, with a wide variety of commodity, currency and interest-rate
+risk. Prior to that, Ms. He traded and structured commodity derivative products at Citigroup, fixed income security products with a focus
+on structured credit and rates at UBS and RBC Capital Markets. Ms. He holds master s degrees in both Mathematical Finance and Engineering
+from University of Toronto, and a bachelor s degree in Engineering from Tongji University.
+
+Mr. Zhuo
+Wang will serve as an independent director immediately upon effectiveness of this prospectus. Mr. Wang serves as the director of Mingzhu
+Logistics Holdings Limited, a NASDAQ-listed company (YGMZ:US), since April 2018. Mr. Wang has over ten years of experience in investment
+and management. He has also been the marketing manager of Singapore construction design and supply company Springview Enterprises Private
+Limited since June 2018. Mr. Wang started to work as the director of an investment holding company, Exquisite Elite Limited since November
+2017. Since May 2017, Mr. Wang has been the managing director of China International Holdings, and its Hong Kong based subsidiaries,
+China International Securities Limited, a securities firm, overseeing the firm s brokerage services, business operations and performance,
+and China International Corporate Management Limited since June 2016, a consulting firm that provides a range of business solutions to
+small and medium sized companies in Asia. Since April 2016, Mr. Wang has also been the head of finance and operations at a Singaporean
+education consulting company Shines International Limited and a director of Total Best Investments Limited, an investment holding company
+since March 2016. Prior to that, Mr. Wang has been the head of finance and marketing of Singapore construction services provider GGL
+Enterprises Pte Ltd since 2012. Mr. Wang also served as a director on the board of various companies, including Belvedere Ventures Pte
+Ltd. between June 2011 to October 2016, a real estate development and construction company, Sandhurst Global Pte Ltd., and between September
+2013 to August 2014, a security personnel staffing and systems company, Acquired Time (HK) Limited. Mr. Wang holds a Bachelor s
+of Science in Business Management from Babson College in Boston, Massachusetts.
+
+ 
+
+ 106
+
+ Table of Contents
+
+ 
+
+ 
+
+Mr.
+Zining Jiang will serve as an independent director immediately upon effectiveness of this prospectus. Mr. Jiang now serves as the general
+manager of Guangzhou Shanxin Trading Co. Ltd., which mainly engages in industrial raw material trade and import and export business since
+July 2018. Prior to that, since July 2015, Mr. Jiang served as the CEO of Guangzhou Yidao Investment Holding Co., Ltd. and an operational
+director at Guangdong Grape Wine Magazine Co., Ltd. In 2007, he joined Yangcheng Evening News Group as the deputy chief editor. He then
+joined China Southern Airlines as assistant to the general manager in April 2011, and was promoted as the operation director of China
+Southern Airlines Media Group. He joined PACOM Media Co. Ltd. in July 2001 and successively served as the chief editor of China Golf,
+Golf Digest and Golf Travel. Prior to that, Mr. Jiang joined Guangdong Cable TV station in 1996 as an editor upon graduation from Jinan
+University.
+
+ 
+
+Mr.
+Xinghua Fan will serve as an independent director immediately upon effectiveness of this prospectus. Mr. Fan currently serves as the
+Vice General Manager and is responsible for the financing and listing of SINO SIC Technology Development Co., Ltd. s silicon carbide
+project. Mr. Fan has served as the Senior Partner and Vice President of Beijing New Board Capital Investment Holdings Co. since 2014.
+At the same time, he is also the executive director of the World Union Fortune Entrepreneur Club and a member of the investment committee.
+Mr. Fan was the COO of Sino-American Holding Group from 2011 to 2013. From 2008 to 2011, he worked as the vice president of Zhongshuo
+Investment Guarantee Group. From 2005 to 2007, he has worked in Xinyuan Guarantee (China) Co., Ltd. as an operation center manager. Mr.
+Fan received a Master s Degree in College of Economics and Management (SEM) from Beihang University.
+
+ 
+
+Advisor
+
+ 
+
+Mr.
+Konstantin A. Sokolov has served as our Senior Advisor since June 2021. Mr. Sokolov has been the independent director of Alpha Star Acquisition
+Corporation since July 19, 2021. Mr. Sokolov is the founder and Chairman of Gotthard Investment AG, which is a private equity firm
+based in Zurich, Switzerland, focusing on financial services, asset management and global real estate. Since 2011, Gotthard Investment
+AG advised and managed multiple investment funds, and partnered with leading Swiss and Lichtenstein banks to invest globally in energy
+and real estate assets. Prior to that, Mr. Sokolov served as Managing Director of Centrica plc (British Gas and Direct Energy).
+Between 1997 to 2005, Mr. Sokolov served in senior leadership positions at Qwest Communication, Inc., a pioneer in fiber optics.
+Mr. Sokolov holds an Executive MBA degree from University of Chicago in 2005 and a Master s of Mathematics and Computer Science
+degree from St. Petersburg State University in 1997.
+
+ 
+
+Number,
+Terms of Office and Election of Officers and Directors
+
+ 
+
+ Upon
+the effectiveness of the registration statement of which this prospectus forms a part, we expect that our Board of Directors will consist
+of four (4) members. Each of our directors will hold office for a two-year term. Subject to any other special rights applicable
+to the shareholders, any vacancies on our Board of Directors may be filled by the affirmative vote of a majority of the directors present
+and voting at the meeting of our board or by an ordinary resolution of the holders of our ordinary shares. 
+
+ 
+
+Our
+officers are elected by the Board of Directors and serve at the discretion of the Board of Directors, rather than for specific terms
+of office. Our Board of Directors is authorized to appoint persons to the offices set forth in our amended and restated memorandum and
+articles of association as it deems appropriate. Our amended and restated memorandum and articles of association will provide that our
+officers may consist of a Chairman, Chief Executive Officer, President, Chief Financial Officer, Vice Presidents, Secretary, Assistant
+Secretaries, Treasurer and such other offices as may be determined by the Board of Directors.
+
+ 
+
+Director
+Independence
+
+ 
+
+The
+NASDAQ listing standards require that a majority of our Board of Directors be independent. An "independent director" is defined
+generally as a person who has no material relationship with the listed company (either directly or as a partner, shareholder or officer
+of an organization that has a relationship with the company). Upon the effectiveness of the registration statement of which this prospectus
+forms a part, we expect to have two "independent directors" as defined in the NASDAQ listing standards and applicable SEC
+rules prior to completion of this offering. Our board has determined that each of Messrs. Zhuo Wang, Zining Jiang and Xinghua
+Fan are independent directors under applicable SEC and NASDAQ rules. Following the completion of our initial public offering, our independent
+directors will have regularly scheduled meetings at which only independent directors are present.
+
+ 
+
+ 107
+
+ Table of Contents
+
+ 
+
+ 
+
+Officer
+and Director Compensation
+
+ 
+
+None
+of our officers or directors have received any cash or non-cash compensation for services rendered to us. Commencing on the date that
+our securities are first listed on the NASDAQ through the earlier of consummation of our initial business combination and our liquidation,
+we will pay an affiliate of our sponsor a total of $10,000 per month for office space, administrative and support services. Our sponsor,
+officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in connection
+with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business combinations.
+Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers, directors or our or their
+affiliates.
+
+ 
+
+After
+the completion of our initial business combination, directors or members of our management team who remain with us may be paid consulting,
+management or other fees from the combined company. All of these fees will be fully disclosed to shareholders, to the extent then known,
+in the tender offer materials or proxy solicitation materials furnished to our shareholders in connection with a proposed business combination.
+It is unlikely the amount of such compensation will be known at the time such materials are distributed, because the directors of the
+post-combination business will be responsible for determining officer and director compensation. Any compensation to be paid to our officers
+will be determined by a compensation committee constituted solely by independent directors.
+
+ 
+
+We
+do not intend to take any action to ensure that members of our management team maintain their positions with us after the consummation
+of our initial business combination, although it is possible that some or all of our officers and directors may negotiate employment
+or consulting arrangements to remain with us after the initial business combination. The existence or terms of any such employment or
+consulting arrangements to retain their positions with us may influence our management s motivation in identifying or selecting
+a target business but we do not believe that the ability of our management to remain with us after the consummation of our initial business
+combination will be a determining factor in our decision to proceed with any potential business combination. We are not party to any
+agreements with our officers and directors that provide for benefits upon termination of employment.
+
+ 
+
+Committees
+of the Board of Directors
+
+ 
+
+Upon
+the effective date of the registration statement of which this prospectus forms part, our Board of Directors will have three standing
+committees: an audit committee, a compensation committee and a nominating committee. Each committee will operate under a charter that
+has been approved by our board and will have the composition and responsibilities described below. Subject to phase-in rules and
+a limited exception, NASDAQ rules and Rule 10A-3 of the Exchange Act require that the audit committee of a listed company be
+comprised solely of independent directors, and NASDAQ rules require that the compensation committee of a listed company be comprised
+solely of independent directors.
+
+ 
+
+Audit
+Committee
+
+ 
+
+Upon
+the effectiveness of the registration statement of which this prospectus forms a part, we will establish an audit committee of the Board
+of Directors. The members of our audit committee will be Messrs. Zhuo Wang, Zining Jiang and Xinghua Fan. Mr. Zhuo Wang will
+serve as chairman of the audit committee.
+
+ 
+
+Each
+member of the audit committee is financially literate and our Board of Directors has determined that Mr. Zhuo Wang qualifies as
+an "audit committee financial expert" as defined in applicable SEC rules.
+
+ 
+
+We
+will adopt an audit committee charter, which will detail the principal functions of the audit committee, including:
+
+ 
+
+ 
+ 
+ 
+ the
+ appointment, compensation, retention, replacement, and oversight of the work of the independent auditors and any other independent
+ registered public accounting firm engaged by us;
+
+ 
+ 
+
+ 
+ 
+ 
+ pre-approving
+ all audit and non-audit services to be provided by the independent auditors or any other registered public accounting firm engaged
+ by us, and establishing pre-approval policies and procedures;
+
+ 
+ 
+
+ 
+ 
+ 
+ reviewing
+ and discussing with the independent auditors all relationships the auditors have with us in order to evaluate their continued independence;
+
+ 
+ 
+
+ 
+ 
+ 
+ setting
+ clear hiring policies for employees or former employees of the independent auditors;
+
+ 
+ 
+
+ 
+ 
+ 
+ setting
+ clear policies for audit partner rotation in compliance with applicable laws and regulations;
+
+ 
+ 
+
+ 108
+
+ Table of Contents
+
+ 
+
+ 
+
+ 
+ 
+ 
+ obtaining
+ and reviewing a report, at least annually, from the independent auditors describing (i) the independent auditor s internal
+ quality-control procedures and (ii) any material issues raised by the most recent internal quality-control review, or peer review,
+ of the audit firm, or by any inquiry or investigation by governmental or professional authorities, within, the preceding five years
+ respecting one or more independent audits carried out by the firm and any steps taken to deal with such issues;
+
+ 
+ 
+
+ 
+ 
+ 
+ reviewing
+ and approving any related party transaction required to be disclosed pursuant to Item 404 of Regulation S-K promulgated by the SEC
+ prior to us entering into such transaction; and
+
+ 
+ 
+
+ 
+ 
+ 
+ reviewing
+ with management, the independent auditors, and our legal advisors, as appropriate, any legal, regulatory or compliance matters, including
+ any correspondence with regulators or government agencies and any employee complaints or published reports that raise material issues
+ regarding our financial statements or accounting policies and any significant changes in accounting standards or rules promulgated
+ by the Financial Accounting Standards Board, the SEC or other regulatory authorities.
+
+ 
+ 
+
+Compensation
+Committee
+
+ 
+
+Upon
+the effectiveness of the registration statement of which this prospectus forms a part, we will establish a compensation committee of
+the Board of Directors. The members of our Compensation Committee will be Messrs. Zhuo Wang, Zining Jiang and Xinghua Fan. Mr. Jiang
+will serve as chairman of the compensation committee. We will adopt a compensation committee charter, which will detail the principal
+functions of the compensation committee, including:
+
+ 
+
+ 
+ 
+ 
+ reviewing
+ and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer s compensation,
+ evaluating our Chief Executive Officer s performance in light of such goals and objectives and determining and approving the
+ remuneration (if any) of our Chief Executive Officer s based on such evaluation;
+
+ 
+ 
+
+ 
+ 
+ 
+ reviewing
+ and approving the compensation of all of our other officers;
+
+ 
+ 
+
+ 
+ 
+ 
+ reviewing
+ our executive compensation policies and plans;
+
+ 
+ 
+
+ 
+ 
+ 
+ implementing
+ and administering our incentive compensation equity-based remuneration plans;
+
+ 
+ 
+
+ 
+ 
+ 
+ assisting
+ management in complying with our proxy statement and annual report disclosure requirements;
+
+ 
+ 
+
+ 
+ 
+ 
+ approving
+ all special perquisites, special cash payments and other special compensation and benefit arrangements for our officers and employees;
+
+ 
+ 
+
+ 
+ 
+ 
+ producing
+ a report on executive compensation to be included in our annual proxy statement; and
+
+ 
+ 
+
+ 
+ 
+ 
+ reviewing,
+ evaluating and recommending changes, if appropriate, to the remuneration for directors.
+
+ 
+ 
+
+The
+charter will also provide that the compensation committee may, in its sole discretion, retain or obtain the advice of a compensation
+consultant, legal counsel or other adviser and will be directly responsible for the appointment, compensation and oversight of the work
+of any such adviser. However, before engaging or receiving advice from a compensation consultant, external legal counsel or any other
+adviser, the compensation committee will consider the independence of each such adviser, including the factors required by the NASDAQ
+and the SEC.
+
+ 
+
+Nominating
+Committee
+
+ 
+
+Effective
+upon the date of this prospectus, we will establish a nominating committee of the board of directors, which will consist of Messrs. Zhuo
+Wang, Zining Jiang and Xinghua Fan. Mr. Fan will serve as chairman of the Nomination committee. The nominating committee is responsible
+for overseeing the selection of persons to be nominated to serve on our board of directors. The nominating committee considers persons
+identified by its members, management, shareholders, investment bankers and others.
+
+ 
+
+ 109
+
+ Table of Contents
+
+ 
+
+ 
+
+Guidelines
+for Selecting Director Nominees
+
+ 
+
+The
+guidelines for selecting nominees, which are specified in the Nominating Committee Charter, generally provide that persons to be nominated:
+
+ 
+
+ should
+ have demonstrated notable or significant achievements in business, education or public service;
+
+ 
+
+ should
+ possess the requisite intelligence, education and experience to make a significant contribution
+ to the board of directors and bring a range of skills, diverse perspectives and backgrounds
+ to its deliberations; and
+
+ 
+
+ should
+ have the highest ethical standards, a strong sense of professionalism and intense dedication
+ to serving the interests of the shareholders.
+
+ 
+
+The
+Nominating Committee will consider a number of qualifications relating to management and leadership experience, background and integrity
+and professionalism in evaluating a person s candidacy for membership on the board of directors. The nominating committee may require
+certain skills or attributes, such as financial or accounting experience, to meet specific board needs that arise from time to time and
+will also consider the overall experience and makeup of its members to obtain a broad and diverse mix of board members. The nominating
+committee does not distinguish among nominees recommended by shareholders and other persons.
+
+ 
+
+Compensation
+Committee Interlocks and Insider Participation
+
+ 
+
+None
+of our officers currently serves, and in the past year has not served, (i) as a member of the compensation committee or Board of
+Directors of another entity, one of whose executive officers served on our compensation committee, or (ii) as a member of the compensation
+committee of another entity, one of whose executive officers served on our Board of Directors.
+
+ 
+
+Code of
+Ethics
+
+ 
+
+Prior
+to the effectiveness of the registration statement of which this prospectus is a part, we will have adopted a Code of Ethics applicable
+to our directors, officers and employees. We will file a copy of our form of Code of Ethics and our audit committee charter as exhibits
+to the registration statement prior to its effectiveness. You will be able to review these documents by accessing our public filings
+at the SEC s web site at www.sec.gov. In addition, a copy of the Code of Ethics will be provided without charge upon request
+from us. We intend to disclose any amendments to or waivers of certain provisions of our Code of Ethics in a Current Report on Form 8-K.
+See "Where You Can Find Additional Information."
+
+ 
+
+Conflicts
+of Interest
+
+ 
+
+Under
+Cayman Islands law, directors and officers owe the following fiduciary duties:
+
+ 
+
+ 
+ 
+ 
+ duty
+ to act in good faith in what the director or officer believes to be in the best interests of the company as a whole;
+
+ 
+ 
+
+ 
+ 
+ 
+ duty
+ to exercise powers for the purposes for which those powers were conferred and not for a collateral purpose;
+
+ 
+ 
+
+ 
+ 
+ 
+ directors
+ should not improperly fetter the exercise of future discretion;
+
+ 
+ 
+
+ 
+ 
+ 
+ duty
+ not to put themselves in a position in which there is a conflict between their duty to the company and their personal interests;
+ and
+
+ 
+ 
+
+ 
+ 
+ 
+ duty
+ to exercise independent judgment.
+
+ 
+ 
+
+ 110
+
+ Table of Contents
+
+ 
+
+ 
+
+In
+addition to the above, directors also owe a duty of care which is not fiduciary in nature. This duty has been defined as a requirement
+to act as a reasonably diligent person having both the general knowledge, skill and experience that may reasonably be expected of a person
+carrying out the same functions as are carried out by that director in relation to the company and the general knowledge skill and experience
+which that director has.
+
+ 
+
+As
+set out above, directors have a duty not to put themselves in a position of conflict and this includes a duty not to engage in self-dealing,
+or to otherwise benefit as a result of their position. However, in some instances what would otherwise be a breach of this duty can be
+forgiven and/or authorized in advance by the shareholders provided that there is full disclosure by the directors. This can be done by
+way of permission granted in the amended and restated memorandum and articles of association or alternatively by shareholder approval
+at general meetings.
+
+ 
+
+Each
+of our directors and officers presently has, and in the future any of our directors and our officers may have additional, fiduciary or
+contractual obligations to other entities pursuant to which such officer or director is or will be required to present acquisition opportunities
+to such entity. Accordingly, subject to his or her fiduciary duties under Cayman Islands law, if any of our officers or directors becomes
+aware of an acquisition opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations,
+he or she will need to honor his or her fiduciary or contractual obligations to present such acquisition opportunity to such entity,
+and only present it to us if such entity rejects the opportunity. Our amended and restated memorandum and articles of association will
+provide that, subject to his or her fiduciary duties under Cayman Islands law, we renounce our interest in any corporate opportunity
+offered to any officer or director unless such opportunity is expressly offered to such person solely in his or her capacity as a director
+or officer of our company and such opportunity is one we are legally and contractually permitted to undertake and would otherwise be
+reasonable for us to pursue. We do not believe, however, that any fiduciary duties or contractual obligations of our directors or officers
+would materially undermine our ability to complete our business combination.
+
+ 
+
+Potential
+investors should also be aware of the following other potential conflicts of interest:
+
+ 
+
+ 
+ 
+ 
+ None
+ of our officers or directors is required to commit his or her full time to our affairs and, accordingly, may have conflicts of interest
+ in allocating his or her time among various business activities.
+
+ 
+ 
+
+ 
+ 
+ 
+ In
+ the course of their other business activities, our officers and directors may become aware of investment and business opportunities
+ which may be appropriate for presentation to us as well as the other entities with which they are affiliated. Our management may
+ have conflicts of interest in determining to which entity a particular business opportunity should be presented. For a complete
+ description of our management s other affiliations, see "— Directors and Officers."
+
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ sponsor, officers and directors have agreed to waive their redemption rights with respect to our founder shares, private placement
+ shares and public shares in connection with the consummation of our initial business combination. Additionally, our sponsor, officers
+ and directors have agreed to waive their redemption rights with respect to their founder shares and private placement shares if we
+ fail to consummate our initial business combination within 9 months from the closing of this offering (or up to 21 months from the
+ closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this
+ prospectus). If we do not complete our initial business combination within such applicable time period, the proceeds of the sale
+ of the private placement units held in the trust account will be used to fund the redemption of our public shares, and the private
+ placement units and underlying securities will be worthless. With certain limited exceptions, 50% of the founder shares will not
+ be transferable, assignable or salable by our sponsor until the earlier of (i) six months after the date of the consummation
+ of our initial business combination or (ii) the date on which the closing price of our ordinary shares equals or exceeds $12.50
+ per share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within any
+ 30-trading day period commencing after our initial business combination and the remaining 50% of the founder shares may not be transferred,
+ assigned or sold until six months after the date of the consummation of our initial business combination, or earlier, in either case,
+ if, subsequent to our initial business combination, we consummate a subsequent liquidation, merger, stock exchange or other similar
+ transaction which results in all of our shareholders having the right to exchange their ordinary shares for cash, securities or other
+ property. With certain limited exceptions, the private placement units and underlying securities will not be transferable, assignable
+ or salable by our sponsor until 30 days after the completion of our initial business combination. Since our sponsor and officers
+ and directors may directly or indirectly own ordinary shares, rights and warrants following this offering, our officers and directors
+ may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate
+ our initial business combination.
+
+ 
+ 
+
+ 111
+
+ Table of Contents
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Our
+ officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention
+ or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect
+ to our initial business combination.
+
+ 
+ 
+
+The
+conflicts described above may not be resolved in our favor.
+
+ 
+
+Accordingly,
+as a result of multiple business affiliations, our officers and directors may have similar legal obligations relating to presenting business
+opportunities meeting the above-listed criteria to multiple entities. Below is a table summarizing the entities to which our officers
+and directors currently have fiduciary duties or contractual obligations:
+
+ 
+
+ 
+ Individual(1)
+ 
+ Entity
+ 
+ Entity s
+ Business
+ 
+ Affiliation
+
+ 
+ Man
+ Chak Leung
+ 
+ China
+ Seven Star Holdings Limited
+
+ Verity
+ Acquisition Corp.
+
+ 
+ Investment
+
+ Investment
+ 
+ General
+ Manager 
+
+ President and Director
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Wenxi
+ He
+ 
+ Still
+ Waters Green Technology Limited 
+ 
+ Renewable
+ Energy
+ 
+ CIO
+ and Director 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Zhuo
+ Wang
+ 
+ Mingzhu
+ Logistics Holdings Limited
+
+ China
+ International Securities Limited
+
+ Exquisite
+ Elite Limited
+
+ Shines
+ International Limited
+
+ Total
+ Best Investments Limited
+
+ Springview
+ Enterprises Private Limited
+
+ 
+ Transportation
+ & Logistics
+
+ Securities
+ Brokerage
+
+ Investment
+
+ Education
+ Consultancy
+
+ Investment
+
+ Construction
+ Design
+
+ 
+ Director
+
+ Director
+
+ Director
+
+ Head
+ of Finance and Operation
+
+ Director
+
+ Marketing
+ Manager
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Zining
+ Jiang
+ 
+ Guangzhou
+ Shanxin Trading Co. Ltd.
+
+ Guangzhou
+ Yidao Investment Holding Co., Ltd.
+
+ 
+ Industrial
+ Raw Material Trade
+
+ Investment
+
+ 
+ General
+ Manager
+
+ CEO
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Xinghua
+ Fan
+ 
+ SINO
+ Sic Technology Development Co., Ltd.
+
+ Beijing
+ New Board Investment Holdings Co., Ltd.
+
+ 
+ Silicon
+ Carbide
+
+ 
+
+ Investment
+
+ 
+ Vice
+ General Manager
+
+ 
+
+ Vice
+ President
+
+ 
+
+ 
+
+ 
+
+ 
+ (1)
+ Each
+ of the entities listed in this table has priority and preference relative to our company with respect to the performance by each
+ individual listed in this table of his obligations and the presentation by each such individual of business opportunities.
+
+ 
+ 
+
+Accordingly,
+if any of the above officers or directors become aware of a business combination opportunity which is suitable for any of the above entities
+to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations
+to present such business combination opportunity to such entity, and only present it to us if such entity rejects the opportunity, subject
+to his or her fiduciary duties under Cayman Islands law. We do not believe, however, that any of the foregoing fiduciary duties or contractual
+obligations will materially affect our ability to complete our initial business combination, because the specific focuses of a majority
+of these entities differ from our focus and the type or size of the transaction that such companies would most likely consider are of
+a size and nature substantially different than what we are targeting.
+
+ 
+
+We
+are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors.
+In the event we seek to complete our initial business combination with such a company, we, or a committee of independent directors, would
+obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for
+the type of company we are seeking to acquire or an independent accounting firm, that such an initial business combination is fair to
+our company from a financial point of view.
+
+ 
+
+In
+the event that we submit our initial business combination to our public shareholders for a vote, our sponsor, officers and directors
+have agreed, pursuant to the terms of a letter agreement entered into with us, to vote any founder shares and private placement shares
+held by them (and their permitted transferees will agree) and any public shares purchased during or after the offering in favor of our
+initial business combination.
+
+ 
+
+ 112
+
+ Table of Contents
+
+ 
+
+ 
+
+Limitation
+on Liability and Indemnification of Officers and Directors
+
+ 
+
+Cayman
+Islands law does not limit the extent to which a company s memorandum and articles of association may provide for indemnification
+of officers and directors, except to the extent any such provision may be held by the Cayman Islands courts to be contrary to public
+policy, such as to provide indemnification against willful default, fraud or the consequences of committing a crime. Our amended and
+restated memorandum and articles of association will provide for indemnification of our officers and directors to the maximum extent
+permitted by law, including for any liability incurred in their capacities as such, except through their own actual fraud or willful
+default. We may purchase a policy of directors and officers liability insurance that insures our officers and directors
+against the cost of defense, settlement or payment of a judgment in some circumstances and insures us against our obligations to indemnify
+our officers and directors.
+
+ 
+
+Insofar
+as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling us
+pursuant to the foregoing provisions, we have been informed that in the opinion of the SEC such indemnification is against public policy
+as expressed in the Securities Act and is therefore unenforceable.
+
+ 
+
+ 113
+
+ Table of Contents
+
+ 
+
+ 
+
+PRINCIPAL
+SHAREHOLDERS
+
+ 
+
+The
+following table sets forth information regarding the beneficial ownership of our ordinary shares as of the date of this prospectus, and
+as adjusted to reflect the sale of our ordinary shares included in the units offered by this prospectus, and assuming no purchase of
+units in this offering, by:
+
+ 
+
+ 
+ 
+ 
+ each
+ person known by us to be the beneficial owner of more than 5% of our issued and outstanding ordinary shares;
+
+ 
+ 
+
+ 
+ 
+ 
+ each
+ of our officers, directors and director nominees that beneficially own ordinary shares; and
+
+ 
+ 
+
+ 
+ 
+ 
+ all
+ our officers, directors and director nominees as a group.
+
+ 
+ 
+
+Unless
+otherwise indicated, we believe that all persons named in the table have sole voting and investment power with respect to all ordinary
+shares beneficially owned by them. The following table does not reflect record or beneficial ownership of any ordinary shares issuable
+upon conversion of rights or exercise of warrants as these rights are not convertible, and these warrants are not exercisable, within
+60 days of the date of this prospectus.
+
+ 
+
+The
+below assumes that the underwriters do not exercise their over-allotment option, that our sponsor forfeits 375,000 founder shares, and
+that there are 12,800,000 ordinary shares issued and outstanding after this offering.
+
+ 
+
+ 
+ 
+ Prior
+ to Offering 
+ After
+ Offering(2) 
+
+ 
+ Name
+ and Address of Beneficial Owner(1) 
+ Amount
+ 
+ and 
+ Nature of 
+ Beneficial 
+ Ownership 
+ Approximate
+ 
+ Percentage 
+ of 
+ Outstanding 
+ Ordinary 
+ Shares(2) 
+ Amount
+
+ and 
+ Nature of 
+ Beneficial 
+ Ownership(3) 
+ Approximate
+ 
+ Percentage
+ of 
+ Outstanding 
+ Ordinary 
+ Shares 
+
+ 
+ M-Star
+ Management Corporation(4) 
+ 2,875,000 
+ 100.0% 
+ 2,875,000 
+ 21.88%
+
+ 
+ Man
+ Chak Leung(4) 
+ — 
+ — 
+ — 
+ — 
+
+ 
+ Wenxi
+ He(5) 
+ — 
+ — 
+ — 
+ — 
+
+ 
+ Zhuo
+ Wang(5) 
+ — 
+ — 
+ — 
+ — 
+
+ 
+ Zining
+ Jiang(5) 
+ — 
+ — 
+ — 
+ — 
+
+ 
+ Xinghua
+ Fan(5) 
+ — 
+ — 
+ — 
+ — 
+
+ 
+ All
+ directors and officers as a group (5 individuals) 
+ 2,875,000 
+ 100.0% 
+ 2,800,000 
+ 21.88%
+
+ 
+
+ 
+
+ 
+
+ 
+ *
+ Less
+ than one percent
+
+ 
+ 
+
+ 
+ (1)
+ Unless
+ otherwise indicated, the business address of each of the individuals is 132 West 31st Street, First Floor, New York, New York 10001.
+
+ 
+
+ 
+
+ 
+ (2)
+ Based
+ on 2,875,000 ordinary shares immediately prior to this offering.
+
+ 
+
+ 
+
+ 
+ (3)
+ Includes
+ the 300,000 private placement units to be purchased by our sponsor simultaneously with the consummation of this offering.
+
+ 
+
+ 
+
+ 
+ (4)
+ Represents
+ shares held by our sponsor. Each of our officers and directors is a shareholder of our sponsor, however, only our Chairman and Chief
+ Executive Officer have voting securities in our sponsor. The address for our sponsor is Craigmuir Chambers, PO Box 71, Road Town,
+ Tortola, VG 1110 British Virgin Islands.
+
+ 
+
+ 
+
+ 
+ (5)
+ Such
+ individual does not beneficially own any of our ordinary shares. However, such individual has a pecuniary interest in our ordinary
+ shares through his ownership of shares of our sponsor.
+
+ 
+
+ 
+
+ 114
+
+ Table of Contents
+
+ 
+
+ 
+
+ Our sponsor has agreed to purchase an aggregate
+of 300,000 units (or 330,000 units if the over-allotment option is exercised in full) at a price of $10.00 per unit for an aggregate
+purchase price of $3,000,000, or $3,300,000 if the over-allotment option is exercised in full, in a private placement that will close
+simultaneously with the closing of this offering. Each unit consists of one private placement share, one private placement right granting
+the holder thereof the right to receive one-tenth (1/10) of an ordinary share upon the consummation of an initial business combination,
+and one private placement warrant. Each private placement warrant entitles the holder to purchase one ordinary share at a price of $11.50
+per share, subject to adjustment as provided herein. The purchase price of the private placement units will be added to the proceeds
+from this offering to be held in the trust account pending our completion of our initial business combination. If we do not complete
+our initial business combination within 9 months from the closing of this offering (or up to 21 months from the closing of this offering
+if we extend the period of time to consummate a business combination, as described in more detail in this prospectus), the proceeds of
+the sale of the private placement units held in the trust account will be used to fund the redemption of our public shares, and the private
+placement units and underlying securities will be worthless. The private placement units are subject to the transfer restrictions described
+below. The private placement warrants will be redeemable by us and exercisable by the holders on the same basis as the warrants included
+in the units being sold in this offering. The private placement warrants have terms and provisions that are identical to those of the
+warrants being sold as part of the units in this offering. 
+
+ 
+
+Transfers
+of Founder Shares and Private Placement Units
+
+ 
+
+The
+founder shares, private placement units and any underlying securities are each subject to transfer restrictions pursuant to lock-up provisions
+in the letter agreement with us to be entered into by our sponsor. Those lock-up provisions provide that such securities are not transferable
+or salable (i) in the case of (A) 50% of the founder shares, until the earlier of (x) six months after the date of the
+consummation of our initial business combination or (z) the date on which the closing price of our ordinary shares equals or exceeds
+$12.50 per share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within
+any 30-trading day period commencing after our initial business combination and (B) the remaining 50% of the founder shares may
+not be transferred, assigned or sold until six months after the date of the consummation of our initial business combination, or earlier,
+in either case, if, subsequent to our initial business combination, we consummate a subsequent liquidation, merger, stock exchange or
+other similar transaction which results in all of our shareholders having the right to exchange their ordinary shares for cash, securities
+or other property, and (ii) in the case of the private placement units and the underlying securities, until 30 days after the completion
+of our initial business combination, except in each case (a) to our sponsor s officers or directors, any affiliates or family
+members of our sponsor or any of our officers or directors, any members of our sponsor, or any affiliates of our sponsor, (b) in
+the case of an individual, by gift to a member of the individual s immediate family or to a trust, the beneficiary of which is
+a member of the individual s immediate family or an affiliate of such person, or to a charitable organization; (c) in the
+case of an individual, by virtue of laws of descent and distribution upon death of the individual; (d) in the case of an individual,
+pursuant to a qualified domestic relations order; (e) transfers by private sales or transfers made in connection with the consummation
+of a business combination at prices no greater than the price at which the securities were originally purchased; (f) in the event
+of our liquidation prior to our completion of our initial business combination; (g) by virtue of the laws of the Cayman Islands
+or our sponsor s constitutional documents upon dissolution of our sponsor; (h) in the event of our liquidation, merger, share exchange,
+reorganization or other similar transaction which results in all of our shareholders having the right to exchange their ordinary shares
+for cash, securities or other property subsequent to the completion of the our initial business combination; and (i) transfers in connection
+with our initial business combination with our consent to any third party; provided, however, that in the case of clauses (a) through
+(e), (h) or (i) these permitted transferees must enter into a written agreement agreeing to be bound by these transfer restrictions
+and by the same agreements entered into by our sponsor with respect to such securities (including provisions relating to voting, the
+trust account and liquidation distributions described elsewhere in this prospectus).
+
+ 
+
+Registration
+Rights
+
+ 
+
+The
+holders of the founder shares, private placement units, and units that may be issued on conversion of working capital loans (and any
+securities underlying the private placement units and the working capital loans) will be entitled to registration rights pursuant to
+a registration rights agreement to be signed prior to or on the effective date of this offering requiring us to register such securities
+for resale. The holders of these securities are entitled to make up to three demands, excluding short form demands, that we register
+such securities. In addition, the holders have certain "piggy-back" registration rights with respect to registration statements
+filed subsequent to our completion of our initial business combination and rights to require us to register for resale such securities
+pursuant to Rule 415 under the Securities Act. We will bear the expenses incurred in connection with the filing of any such registration
+statements.
+
+ 
+
+ 115
+
+ Table of Contents
+
+ 
+
+ 
+
+CERTAIN
+RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
+
+ 
+
+On
+July 5, 2021, our sponsor purchased 1,437,500 founder shares for an aggregate purchase price of $25,000, or approximately $0.02 per share.
+On September 26, 2021, the Company purchased back all the 1,437,500 founder shares for $25,000 and reissued 2,875,000 shares to our sponsor
+for $25,000, or approximately $0.01 per shares. Our sponsor will own approximately 21.88% of our issued and outstanding shares after
+this offering (assuming it does not purchase units in this offering and taking into account ownership of the private placement units).
+If we increase or decrease the size of the offering, we will effect a capitalization or share surrender or redemption or other appropriate
+mechanism, as applicable, with respect to our ordinary shares immediately prior to the consummation of the offering in such amount as
+to maintain the ownership of founder shares of our sponsor prior to this offering at 20% of our issued and ordinary shares upon the consummation
+of this offering (assuming it does not purchase units in this offering and not taking into account ownership of the private placement
+units).
+
+ 
+
+ Our sponsor (and/or its designees) has agreed
+to purchase an aggregate of 300,000 private placement units (or 330,000 units if the over-allotment option is exercised in full) at a
+price of $10.00 per unit (consisting of 300,000 private placement units (or 330,000 units if the over-allotment option is exercised in
+full) in a private placement that will close simultaneously with the closing of this offering. Each unit consists of one private placement
+share, one private placement right granting the holder thereof the right to receive one-tenth (1/10) of an ordinary share upon the consummation
+of an initial business combination, and one private placement warrant. Each private placement warrant entitles the holder upon exercise
+to purchase one ordinary share at a price of $11.50 per share, subject to adjustment as provided herein. The private placement units
+(including the underlying securities) may not, subject to certain limited exceptions, be transferred, assigned or sold by it until 30
+days after the completion of our initial business combination. 
+
+ 
+
+As
+more fully discussed in "Management — Conflicts of Interest," if any of our officers or directors becomes aware of
+a business combination opportunity that falls within the line of business of any entity to which he or she has then-current fiduciary
+or contractual obligations, he or she may be required to present such business combination opportunity to such entity prior to presenting
+such business combination opportunity to us, subject to his or her fiduciary duties under Cayman Islands law. Our officers and directors
+currently have certain relevant fiduciary duties or contractual obligations that may take priority over their duties to us.
+
+ 
+
+We
+will enter into an Administrative Services Agreement with M-Star Management Corporation, an affiliate of our sponsor, pursuant to which
+we will pay a total of $10,000 per month for office space, administrative and support services to such affiliate. Upon completion of
+our initial business combination or our liquidation, we will cease paying these monthly fees. Accordingly, in the event the consummation
+of our initial business combination takes the maximum 21 months, an affiliate of our sponsor will be paid a total of $210,000 ($10,000
+per month) for office space, administrative and support services and will be entitled to be reimbursed for any out-of-pocket expenses.
+
+ 
+
+ 116
+
+ Table of Contents
+
+ 
+
+ 
+
+Our
+sponsor, officers and directors, or any of their respective affiliates, will be reimbursed for any out-of-pocket expenses incurred in
+connection with activities on our behalf such as identifying potential target businesses and performing due diligence on suitable business
+combinations. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers, directors or
+our or their affiliates and will determine which expenses and the amount of expenses that will be reimbursed. There is no cap or ceiling
+on the reimbursement of out-of-pocket expenses incurred by such persons in connection with activities on our behalf.
+
+ 
+
+As
+of the date of this prospectus, our sponsor (and/or its designees) has agreed to loan us up to $300,000 to be used for a portion of the
+expenses of this offering. As December 31, 2021, we had borrowed $300,000 under the promissory note with our sponsor. These loans are
+non-interest bearing, unsecured and are due at the earlier of March 31, 2022 or the closing of this offering. The loans will be repaid
+upon the closing of this offering out of the estimated $500,000 of funds reserved for the payment of offering expenses. The value of
+our sponsor s interest in this transaction corresponds to the principal amount outstanding under any such loan.
+
+ 
+
+ In
+addition, in order to finance transaction costs in connection with an intended initial business combination, our sponsor or an affiliate
+of our sponsor or certain of our officers and directors may, but are not obligated to, loan us funds as may be required. If we complete
+an initial business combination, we would repay such loaned amounts. In the event that the initial business combination does not close,
+we may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust
+account would be used for such repayment. Up to $1,500,000 of such loans may be convertible into units at a price of $10.00 per unit
+(which, for example, would result in the holders being issued 165,000 ordinary shares if $1,500,000 of notes were so converted (including
+15,000 shares upon the closing of our initial business combination in respect of 150,000 rights included in such units), as well as 150,000
+warrants to purchase 150,000 shares) at the option of the lender. The units would be identical to the placement units issued to the initial
+holder. The terms of such loans by our officers and directors, if any, have not been determined and no written agreements exist with
+respect to such loans. We do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not
+believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our
+trust account. 
+
+ 
+
+After
+our initial business combination, members of our management team who remain with us may be paid consulting, management or other fees
+from the combined company with any and all amounts being fully disclosed to our shareholders, to the extent then known, in the tender
+offer or proxy solicitation materials, as applicable, furnished to our shareholders. It is unlikely the amount of such compensation will
+be known at the time of distribution of such tender offer materials or at the time of a shareholder meeting held to consider our initial
+business combination, as applicable, as it will be up to the directors of the post-combination business to determine executive and director
+compensation.
+
+ 
+
+We
+have entered into a registration rights agreement with respect to the founder shares, private placement units and units issued upon conversion
+of working capital loans (if any), and the securities underlying the private placement units and the working capital loans (if any),
+which is described under the heading "Principal Shareholders — Registration Rights."
+
+ 
+
+Related
+Party Policy
+
+ 
+
+We
+have not yet adopted a formal policy for the review, approval or ratification of related party transactions. Accordingly, the transactions
+discussed above were not reviewed, approved or ratified in accordance with any such policy.
+
+ 
+
+Prior
+to the consummation of this offering, we will adopt a code of ethics requiring us to avoid, wherever possible, all conflicts of interests,
+except under guidelines or resolutions approved by our Board of Directors (or the appropriate committee of our board) or as disclosed
+in our public filings with the SEC. Under our code of ethics, conflict of interest situations will include any financial transaction,
+arrangement or relationship (including any indebtedness or guarantee of indebtedness) involving the company. A form of the code of ethics
+that we plan to adopt prior to the consummation of this offering is filed as an exhibit to the registration statement of which this prospectus
+is a part.
+
+ 
+
+ 117
+
+ Table of Contents
+
+ 
+
+ 
+
+In
+addition, our audit committee, pursuant to a written charter that we will adopt prior to the consummation of this offering, will be responsible
+for reviewing and approving related party transactions to the extent that we enter into such transactions. An affirmative vote of a majority
+of the members of the audit committee present at a meeting at which a quorum is present will be required in order to approve a related
+party transaction. A majority of the members of the entire audit committee will constitute a quorum. Without a meeting, the unanimous
+written consent of all of the members of the audit committee will be required to approve a related party transaction. A form of the audit
+committee charter that we plan to adopt prior to the consummation of this offering is filed as an exhibit to the registration statement
+of which this prospectus is a part. We also require each of our directors and executive officers to complete a directors and officers 
+questionnaire that elicits information about related party transactions.
+
+ 
+
+These
+procedures are intended to determine whether any such related party transaction impairs the independence of a director or presents a
+conflict of interest on the part of a director, employee or officer.
+
+ 
+
+To
+further minimize conflicts of interest, we have agreed not to consummate an initial business combination with an entity that is affiliated
+with any of our sponsor, officers or directors unless we, or a committee of independent directors, have obtained an opinion from an independent
+investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to
+acquire or an independent accounting firm, that our initial business combination is fair to our company from a financial point of view.
+Furthermore, no finder s fees, reimbursements or cash payments will be made to our sponsor, officers or directors, or our or their
+affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination. However, the
+following payments will be made to our sponsor, officers or directors, or our or their affiliates, none of which will be made from the
+proceeds of this offering held in the trust account prior to the completion of our initial business combination:
+
+ 
+
+ 
+ 
+ 
+ Repayment
+ of up to an aggregate of up to $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses;
+
+ 
+ 
+
+ 
+ 
+ 
+ Payment
+ to an affiliate of our sponsor (M-Star Management Corporation) of $10,000 per month, for 9 months (or up to 21 months), for office
+ space, utilities and secretarial and administrative support;
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Reimbursement
+ for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; and
+
+ 
+ 
+
+ 
+ 
+ 
+ Repayment
+ of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction
+ costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written
+ agreements been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into units, at a price of $10.00
+ per unit (which, for example, would result in the holders being issued 165,000 ordinary shares if $1,500,000 of notes were so converted
+ (including 15,000 shares upon the closing of our initial business combination in respect of 150,000 rights included in such units),
+ as well as 150,000 warrants to purchase 150,000 shares) at the option of the lender. 
+
+ 
+ 
+
+Our
+audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliates.
+
+ 
+
+ 118
+
+ Table of Contents
+
+ 
+
+ 
+
+DESCRIPTION
+OF SECURITIES
+
+ 
+
+We
+are a Cayman Islands exempted company and our affairs are governed by our amended and restated memorandum and articles of association,
+the Companies Act and common law of the Cayman Islands. Pursuant to our amended and restated memorandum and articles of association which
+will be adopted upon the consummation of this offering, we will be authorized to issue 50,000,000 ordinary shares, with par value $0.001
+per share. The following description summarizes the material terms of our shares as set out more particularly in our memorandum and articles
+of association. Because it is only a
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/MTEKW_maris_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/MTEKW_maris_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/MTEKW_maris_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/MVSTW_microvast_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/MVSTW_microvast_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/MVSTW_microvast_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/NNAX_new_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/NNAX_new_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..1eb4d168b59abff94077d7c41fe6f174a4c39436
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/NNAX_new_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 6
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/NOTE-WT_fiscalnote_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/NOTE-WT_fiscalnote_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..82fcc60441140265456f10868f9f96ee9c7952f0
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/NOTE-WT_fiscalnote_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS This summary highlights selected information included in this prospectus and does not contain all of the information that may be important to you in making an investment decision. This summary is qualified in its entirety by the more detailed information included in this prospectus. Before making your investment decision with respect to our securities, you should carefully read this entire prospectus, including the information under Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations and the financial statements included elsewhere in this prospectus. The Company FiscalNote Holdings, Inc. 1201 Pennsylvania Avenue NW, 6th Floor Washington, D.C. 20004 (202) 793-5300 We are a technology and data company delivering critical legal data and insights in a rapidly evolving economic, political and regulatory world. By combining artificial intelligence, or AI, machine learning and other technologies with analytics, workflow tools, and expert research, we seek to reinvent the way that organizations minimize risks and capitalize on opportunities associated with rapidly changing legal and policy environments. Through a number of our products, we ingest unstructured legislative and regulatory data, and employ AI and data science to deliver structured, relevant and actionable information in order to facilitate key operational and strategic decisions by global enterprises, midsized and smaller businesses, government institutions, trade groups, and nonprofits. We deliver that intelligence through our suite of public policy and issues management products, coupled with expert research and analysis of markets and geopolitical events, as well as powerful tools to manage workflows, advocacy campaigns and constituent relationships. For more information, see Risk Factors Risks Related to Our Business We have a history of net losses, anticipate increasing operating expenses in the future, and may not be able to achieve and, if achieved, maintain profitability. Background The Company was originally known as Duddell Street Acquisition Corp. ( DSAC ). DSAC (and after the Domestication as described below, New FiscalNote ), a Cayman Islands exempted company, previously entered into an agreement and plan of merger, dated as of November 7, 2021, as amended on May 9, 2022 (the Business Combination Agreement ) by and among DSAC, Grassroots Merger-Sub, Inc., a Delaware corporation ( Merger Sub ), and FiscalNote Intermediate HoldCo, Inc. (formerly FiscalNote Holdings, Inc.), a Delaware corporation ( Legacy FiscalNote ). On July 28, 2022, DSAC filed a notice of deregistration with the Cayman Islands Registrar of Companies, together with the necessary accompanying documents, and filed a certificate of incorporation and a certificate of domestication with the Secretary of State of the State of Delaware, pursuant to which DSAC was domesticated and continued as a Delaware corporation (the Domestication ). As used herein, New DSAC refers to DSAC after the Domestication but prior to the consummation of the Business Combination (as defined below). On July 29, 2022 (the Closing Date ), as contemplated by the Business Combination Agreement, New DSAC consummated the merger transaction contemplated by the Business Combination Agreement (the Closing ), whereby Merger Sub merged with and into Legacy FiscalNote, with the separate corporate existence of Merger Sub ceasing and Legacy FiscalNote being the surviving corporation and a wholly owned subsidiary of New DSAC (the Table of Contents Merger ) and, together with the Domestication, the Business Combination ). In connection with the consummation of the Business Combination, New DSAC changed its name to FiscalNote Holdings, Inc. Effective upon consummation of the Business Combination, we adopted a dual-class stock structure, each as described in the section of this prospectus titled Description of Securities. Shares of FiscalNote Class B Common Stock have the same economic terms as shares of FiscalNote Class A Common Stock, except that shares of FiscalNote Class A Common Stock have one vote per share and shares of FiscalNote Class B Common Stock have twenty-five (25) votes per share. Stock Exchange Listing Our Class A Common Stock and Public Warrants are currently listed on the New York Stock Exchange ( NYSE ) and trade under the symbols NOTE and NOTE.WS , respectively. On September 26, 2022, the closing price of our Class A Common Stock was $6.70 per share and the closing price of our Public Warrants was $0.87 per Public Warrant. Table of Contents Summary of Risk Factors Investing in our securities involves risks. You should carefully consider the risks described in Risk Factors beginning on page 9 before making a decision to invest in our Class A Common Stock. If any of these risks actually occurs, our business, financial condition and results of operations would likely be materially adversely affected. Some of the risks related FiscalNote s business and industry are summarized below. References in the summary below to we, us, our and the Company generally refer to FiscalNote. We have recently experienced rapid growth that may not be indicative of future growth, which makes it difficult to forecast our revenue and evaluate our business and prospects. We have a history of net losses, anticipate increasing operating expenses in the future, and may not be able to achieve and, if achieved, maintain profitability. If we are unable to attract new customers, retain existing customers, expand our products and services offerings with existing customers, expand into new geographic markets or identify areas of higher growth, our revenue growth and profitability will be harmed. A principal focus of our business strategy is to grow and expand our business through acquisitions. We may not be able to successfully identify attractive acquisition opportunities or make acquisitions on terms that are satisfactory to us from a commercial perspective. We rely on third parties, including public sources, for data, information and other products and services, and our relationships with such third parties may not be successful or may change, which could adversely affect our results of operations. If we fail to maintain and improve our methods and technologies, or anticipate new methods or technologies, for data collection, organization, and analysis, as well as search and other product features that facilitate the customer s ability to derive relevant insights from our products, competing products and services could surpass ours in depth, breadth, or accuracy of its data or other features. Our international operations subject us to additional risks that can adversely affect our business, results of operations and financial condition. Our key performance metrics are subject to significant risks, assumptions, estimates and uncertainties. As a result, our financial and operating results may differ materially from our expectations. We may not be able to adequately obtain, maintain, protect and enforce our proprietary and intellectual property rights in our data or technology. We have entered into certain licensing agreements and other strategic relationships with third parties. These agreements and relationships may not continue and we may not be successful in entering into other similar agreements and relationships. If we fail to maintain its current licensing agreements or establish new relationships, it could result in loss of revenue and harm our business and financial condition or an inability for us to use the intellectual property licensed to us by the applicable third party. We have identified material weaknesses in our internal control over financial reporting, and our management has concluded that our disclosure controls and procedures are not effective. While we are working to remediate any material weakness in our internal controls over financial reporting, we cannot assure you that additional material weaknesses will not occur in the future. If our internal control over financial reporting or our disclosure controls and procedures are not effective, we may not be able to accurately report our financial results or prevent fraud, which may cause investors to lose confidence in our reported financial information and may lead to a decline in our stock price. Cyber-attacks, security, privacy, or data breaches or other security incidents that affect our networks or systems, or those of our service providers, involving our or our customers sensitive, personal, classified or Table of Contents confidential information could expose us to liability under various laws and regulations across jurisdictions, decrease trust in us and our products and services, increase the risk of litigation and governmental investigation, and harm our reputation, business, and financial condition. We depend on third parties for data, information and other services, and our ability to serve our customers could be adversely impacted if such third parties fail to fulfill their obligations, if we are unable to effectively manage and minimize errors, failures, interruptions or delays caused by third parties, or if our arrangements with them are terminated and suitable replacements cannot be found on commercially reasonable terms or at all. Following the consummation of the Business Combination, only our Co-Founders were entitled to hold shares of our Class B Common Stock, which shares have twenty-five (25) votes per share. This limits or precludes other stockholders ability to influence the outcome of matters submitted to stockholders for approval, including the election of directors, the approval of certain employee compensation plans, the adoption of amendments to our organizational documents and the approval of any merger, consolidation, sale of all or substantially all of our assets, or other major corporate transaction requiring stockholder approval. We are a controlled company under NYSE listing standards, and as a result, our stockholders may not have certain corporate protections that are available to stockholders of companies that are not controlled companies. The securities being offered in this prospectus represent a substantial percentage of our outstanding Class A Common Stock. The Selling Securityholders purchased the securities covered by this prospectus at different prices, some significantly below the current trading price of such securities, and some Selling Securityholders received such securities without any consideration, and may therefore make substantial profits upon resales. Sales of a substantial number of our Class A Common Stock into the public market, including when lock-up periods end, or the perception that such sales might occur, could cause the market price of our Class A Common Stock to decline. The Warrants may never be in the money, and may expire worthless. Our management team has limited experience managing a public company. Emerging Growth Company Section 102(b)(1) of the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ) exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a registration statement under the Securities Act declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such an election to opt out is irrevocable. We have elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of FiscalNote s financial statements with those of another public company that is neither an emerging growth company nor an emerging growth company that has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. We will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) following the fifth anniversary of the closing of DSAC s initial public offering, (b) in which we have total annual gross Table of Contents revenue of at least $1.07 billion or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common equity that is held by non-affiliates exceeds $700 million as of the end of the prior fiscal year s second fiscal quarter; and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company have the meaning associated with it in the JOBS Act. Table of Contents
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/NRGV_energy_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/NRGV_energy_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..45ea7a1fa86ca6ab06e2255034fa7a077d0ae71d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/NRGV_energy_prospectus_summary.txt
@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS This summary highlights selected information from this prospectus and does not contain all of the information that is important to you in making an investment decision. This summary is qualified in its entirety by the more detailed information included in this prospectus. Before making your investment decision with respect to our securities, you should carefully read this entire prospectus, including the information under Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations and the financial statements included elsewhere in this prospectus. Unless otherwise indicated or the context otherwise requires, references in this prospectus to we, our, us and other similar terms refer to Energy Vault. Energy Vault Energy Vault develops sustainable, grid-scale energy storage solutions designed to advance the transition to a carbon free, resilient power grid. Energy Vault s mission is to accelerate the decarbonization of our economy through the development of sustainable and economical energy storage technologies. To achieve this, Energy Vault is developing a proprietary gravity-based energy storage technology. Energy Vault is also designing proprietary energy management software based on artificial intelligence (AI), advanced optimization algorithms designed to control and optimize entire energy systems and a flexible energy storage integration platform suitable for storage technologies of many durations. Energy Vault s product platform aims to help utilities, independent power producers, and large energy users significantly reduce their levelized cost of energy while maintaining power reliability. The mailing address of Energy Vault s principal executive office is 4360 Park Terrace Drive, Suite 100, Westlake Village, California 93161, and its telephone number is (805) 852-0000. For more information about Energy Vault, see the sections entitled Business, Management s Discussion and Analysis of Financial Condition and Results of Operations, Risk Factors and the financial statements of Energy Vault included herein. The Business Combination On February 11, 2022 (the Closing Date ), Energy Vault consummated the previously announced business combination (the Closing ) pursuant to the Business Combination Agreement. At the Closing, Merger Sub merged with and into Legacy Energy Vault, with Legacy Energy Vault surviving the merger as a wholly owned subsidiary of the Company (the Merger ). As a result of the Business Combination, Legacy Energy Vault became a wholly-owned subsidiary of the Company. Pursuant to the terms of the Business Combination Agreement, each stockholder of Legacy Energy Vault received 6.7735 shares of the Company s common stock, par value $0.0001 per share (the Common Stock ) and the contingent right to receive certain Earn Out Shares (as defined below), for each share of Legacy Energy Vault common stock, par value $0.0001 per share, owned by such Legacy Energy Vault stockholder that was outstanding immediately prior to the Closing. In addition, certain investors (such investors, the Subscribers ) purchased an aggregate of 19,500,005 shares of Common Stock (such shares, the PIPE Shares ) concurrently with the Closing for an aggregate purchase price of $195,000,050. Additionally, at the Closing, after giving effect to the forfeiture of certain shares by the Founders, each outstanding share of the Novus s Class B common stock, par value $0.0001 per share was converted into a share of Common Stock on a one-for-one basis. In addition, pursuant to the terms of the Business Combination Agreement, at the effective time of the Merger (the Effective Time ), (1) options to purchase shares of common stock of Legacy Energy Vault were converted into options to purchase an aggregate of 1,179,848 shares of Common Stock at a weighted average exercise price of $0.71 per share, (2) restricted stock units to acquire shares of common stock of Legacy Energy Vault were converted into restricted stock units that represent the right to acquire an aggregate of 7,284,511 shares of Common Stock and (3) awards of outstanding restricted shares of Legacy Energy Vault Common Stock issued pursuant to a grant agreement under Energy Vault s 2017 Stock Incentive Plan or otherwise, whether vested or unvested, were converted into restricted stock awards with respect to an aggregate of 609,615 shares of Common Stock. TABLE OF CONTENTS During the time period between the Closing Date and the third anniversary of the Closing, eligible former equityholders of Legacy Energy Vault may receive up to 9,000,000 additional shares of Common Stock (the Earn Out Shares ) in the aggregate in three equal tranches upon the achievement of certain earn out targets (as further described in the Business Combination Agreement). Risk Factors Investing in our securities involves risks. You should carefully consider the risks described in Risk Factors beginning on page 9 before making a decision to invest in our Common Stock. If any of these risks actually occurs, our business, financial condition and results of operations would likely be materially adversely affected. In such case, the trading price of our securities would likely decline, and you may lose all or part of your investment. Set forth below is a summary of some of the principal risks we face: Energy Vault is an early stage company with a history of losses, and it expects to incur significant expenses and continuing losses for the foreseeable future, and it may not be able to achieve profitability in the future; Energy Vault s limited operating history and its rapidly evolving industry make it difficult to evaluate Energy Vault s business, the risks and challenges it may face and future prospects; The engineering of Energy Vault s systems is in continuous refinement to improve system cost and efficiency. There is no guarantee that it will be successful in implementing all improvements under the expected schedule; There is no assurance that non-binding letters of intent and other indications of interest will be converted into binding orders or sales. Customers may cancel or delay the non-binding letters of intent and other indications of interest in Energy Vault s sales pipeline; Energy Vault s systems are based on established principles that are deployed in a novel way to create new technologies to store energy and potential customers may be hesitant to make a significant investment in Energy Vault s technology or abandon the technology they are currently using; Energy Vault s systems include complex software and technology systems and do not have a meaningful history of operation, and there can be no assurance such systems and technology will perform as expected or that software, engineering or other technical defects will not be discovered until after a system is installed and operated by a customer. If Energy Vault s EVx systems contain manufacturing or construction defects, its business and financial results could be harmed; The performance and availability of Energy Vault s products, services and systems may be affected by factors outside of its control, which could result in harm to its business and financial results; If any of Energy Vault s products are or are alleged to be defective in design or manufacturing or experience other failures, Energy Vault may be compelled to undertake corrective actions, which could adversely affect its business, prospects, operating results, reputation and financial condition; Energy Vault s systems performance may not meet its customers expectations or needs; Energy Vault s systems involve a lengthy sales and installation cycle, and if it fails to close sales on a regular and timely basis it could harm its business. Moreover, the long sales cycles for Energy Vault s products may cause it to incur significant expenses without offsetting revenues; and The failure or inability of Energy Vault s suppliers to deliver necessary components or raw materials for construction of its systems in a timely manner could cause installation delays, cancellations, penalty payments and damage to its reputation. If the selling security holders sell their securities, it may negatively impact the market price of the shares of our Common Stock and such holders still may receive significant proceeds. TABLE OF CONTENTS
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+S-1 1 tm2223302d1_s1.htm FORM S-1 As filed with the U.S. Securities and Exchange Commission on August 15, 2022. Registration No. 333- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM S-1 REGISTRATION STATEMENT Under The Securities Act of 1933 Nuvectis Pharma, Inc. (Exact name of Registrant as specified in its charter) Delaware 2834 86-2405608 (State of incorporation (Primary Standard Industrial (I.R.S. Employer or organization) Classification Code Number) Identification Number) 1 Bridge Plaza Suite 275 Fort Lee, NJ, 07024 (201) 614-3150 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Ron Bentsur, M.B.A. Chairman and Chief Executive Officer Nuvectis Pharma, Inc. 1 Bridge Plaza Suite 275 Fort Lee, NJ, 07024 (201) 614-3151 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copy to: Matthew W. Mamak Alston & Bird LLP 90 Park Avenue New York, NY 10016 (212) 210-1256 Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement. If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer" "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. The information in this preliminary prospectus is not complete and may be changed. Neither we nor the selling security holders may sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities, and it is not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED AUGUST , 2022 1,015,598 Shares of Common Stock Up to 909,091 Shares of Class Common Stock Issuable Upon Exercise of the Pre-Funded Warrants Up to 2,040,170 Shares of Class Common Stock Issuable Upon Exercise of the Preferred Investment Options Nuvectis Pharma, Inc. This prospectus relates to the offer and resale from time to time by the selling securityholders named in this prospectus (the "Selling Shareholders") of shares of common stock, par value $0.00001 per share ("Common Stock") of Nuvectis Pharma, Inc., a Delaware corporation ("Nuvectis", the "Company", "we", "us" or "our) consisting of (i) up to: 1,015,598 shares of our Common Stock issued in connection with our private placement offering (the "Shares"); (ii) up to 2,040,170 shares of Common Stock that may be obtained upon the exercise of preferred investment options to purchase shares of Common Stock (the "Investment Options"); and (iii) up to 909,091 pre-funded warrants to purchase shares of Common Stock issued in a private placement (the "Pre-Funded Warrants"). We will not receive any proceeds from the sale of the securities under this prospectus, although we could receive up to $19,765,056 upon the exercise of all of the Investment Options and Pre-Funded Warrants. Any amounts we receive from such exercises will be used for working capital and other general corporate purposes. Information regarding the Selling Shareholders, the amounts of shares of Common Stock that may be sold by them and the times and manner in which they may offer and sell the shares of common stock under this prospectus is provided under the sections titled "Selling Shareholders" and "Plan of Distribution," respectively, in this prospectus. We have not been informed by any of the Selling Shareholders that they intend to sell the common stock covered by this prospectus and do not know when or in what amount the Selling Shareholders may offer the common stock for sale. The Selling Shareholders may sell any, all, or none of the common stock offered by this prospectus. Our Common Stock is listed on the Nasdaq Capital Market under the symbol "NVCT". On August 12, 2022, the last reported sale price of our common stock was $8.71 per share. We are an "emerging growth company" and a "smaller reporting company" as defined under the U.S. federal securities laws and, as such, have elected to comply with certain reduced reporting requirements. Investing in our common stock involves a high degree of risk. See "Risk factors" beginning on page 8. Neither the Securities and Exchange Commission nor any other state securities commission has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. You should rely only on the information contained in this prospectus. We have not authorized any dealer, salesperson or other person to provide you with information concerning us, except for the information contained in this prospectus. The information contained in this prospectus is complete and accurate only as of the date on the front cover page of this prospectus, regardless of the time of delivery of this prospectus or the sale of any securities. This prospectus is not an offer to sell these securities and we are not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. The date of this prospectus is August 15, 2022. About this Prospectus In this prospectus, unless the context suggests otherwise, references to "Nuvectis Pharma," "Nuvectis," the "Company," "we," "us" and "our" refer to Nuvectis Pharma, Inc. This prospectus is part of a registration statement on Form S-1 that we filed with the Securities and Exchange Commission (the "SEC"). Under this registration process, the Selling Shareholders may, from time to time, sell the securities offered by them described in this prospectus through any means described in the section titled "Plan of Distribution". We will not receive any proceeds from the sale by such Selling Holders of the securities offered by them described in this prospectus. This prospectus also relates to the issuance by us of the shares of Common Stock issuable upon the exercise of any Investment Option or Pre-Funded Warrant. We will receive proceeds from any exercise of the Investment Options and Pre-Funded Warrants for cash. Neither we nor the Selling Shareholders have authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or any applicable prospectus supplement or any free writing prospectuses prepared by or on behalf of us or to which we have referred you. Neither we nor the Selling Shareholders take responsibility for and can provide no assurance as to the reliability of, any other information that others may give you. Neither we nor the Selling Shareholders will make an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. We may also provide a prospectus supplement or post-effective amendment to the registration statement to add information to, or update or change information contained in, this prospectus. Any statement contained in this prospectus will be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained in such prospectus supplement or post-effective amendment modifies or supersedes such statement. Any statement so modified will be deemed to constitute a part of this prospectus only as so modified, and any statement so superseded will not be deemed to constitute a part of this prospectus. You should read both this prospectus and any applicable prospectus supplement or post-effective amendment to the registration statement together with the additional information to which we refer you in the section of this prospectus titled "Where You Can Find More Information." ii Prospectus Summary This summary highlights information contained in greater detail elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our Common Stock, you should carefully read this entire prospectus, including our financial statements and the related notes thereto included elsewhere in this prospectus. You should also consider, among other things, the information set forth under the sections titled "Risk Factors," "Special Note Regarding Forward-Looking Statements," and "Management s Discussion and Analysis of Financial Condition and Results of Operations," in each case appearing elsewhere in this prospectus. Unless the context otherwise requires, we use the terms "Nuvectis," "Nuvectis Pharma," the "Company," "we," "us," "our" and similar designations in this prospectus to refer to Nuvectis Pharma, Inc. and, where appropriate, our subsidiaries. Overview We are a biopharmaceutical company focused on the development of novel targeted small molecule therapeutics for the treatment of cancer in genetically defined patient populations. Our precision medicine approach translates key scientific insights relating to the oncogenic drivers and pathway addiction of cancer into potent and highly selective anticancer drugs. In addition, we will investigate the relevance of specific mutations and other DNA alterations as a potential patient selection marker and to identify synthetic lethality targets. This work could support our use of a tumor agnostic development strategy wherein we enroll patients based on the cancer s genetic and molecular features without regard to the type or location of the cancer. NXP800 (HSF1-Pathway Inhibitor) We have licensed exclusive world-wide commercial rights to NXP800, a clinical-stage novel Heat Shock Factor 1 ("HSF1") pathway inhibitor, which was developed at the Institute for Cancer Research ("ICR") in London, England. Cancer cells actively exploit HSF1 to overcome diverse stresses and promote biological activities crucial for their survival, progression, immune evasion, and metastasis. In preclinical studies, treatment with NXP800 inhibited tumor growth in xenografts models of human ovarian cancer. In addition, a genetic mutation in the AT-rich interactive domain-containing protein 1A ("ARID1a") gene has been identified as a potential biomarker for treatment sensitivity and patient selection. Based on this work, we plan to clinically investigate NXP800 in Ovarian Clear Cell Carcinoma ("OCCC") and endometrioid ovarian carcinoma, and to investigate the utility of ARID1a deficiency as a patient selection marker. The genetic screening for the ARID1a mutation is a standard part of the commercially available screening panels being utilized in the clinic for cancer patients. The ongoing Phase 1 study of NXP800 is comprised of two parts: dose-escalation Phase 1a, initiated in December 2021, to be followed by an expansion Phase 1b. In the Phase 1a, the safety and tolerability of NXP800 is being evaluated in patients with advanced solid tumors to identify a dose and dosing schedule for the Phase 1b. In the Phase 1b, the safety and preliminary anti-tumor activity of NXP800 will be evaluated, initially in patients with OCCC and endometrioid carcinoma and possibly in patients with other types of solid tumors. Additional preclinical studies are currently being conducted to identify development opportunities for NXP800 in additional solid tumor types. NXP900 NXP900 is a preclinical-stage drug candidate designed to preferentially inhibit the Proto-oncogene c-Src ("SRC") and YES1 kinases. NXP900 was discovered at the University of Edinburgh. SRC is aberrantly activated in many cancer types, including solid tumors such as breast, colon, prostate, pancreatic and ovarian, while remaining predominantly inactive in non-cancerous cells. Increased SRC activity is generally associated with late-stage cancers, metastatic potential and resistance to therapy, and correlates with poor clinical prognosis. YES1 gene amplification has been reported to be implicated in several tumors including lung, head and neck, bladder and esophageal cancers. Furthermore, it has been found that YES1 gene amplification is a key mechanism of resistance to Epidermal Growth Factor Receptor ("EGFR") or (Human Epidermal Growth Factor Receptor 2 ("HER2") inhibitors. A recent, peer reviewed study published in Nature Communication which was not sponsored by the Company, has shown positive effects of using NXP900 in combination with the leading EFGR inhibitor, Tagrisso, to overcome Tagrisso resistance in Tagrisso-resistant cell lines. 1 Preclinically, NXP900 has been shown to inhibit SRC and YES1 kinases and substantially inhibit growth of primary tumors and bone metastases in several triple negative breast cancer ("TNBC") animal models. We plan to initially develop NXP900 in solid tumors where SRC and/or YES1 are implicated. We anticipate submitting an IND or an equivalent submission with a foreign agency in early 2023. Since our inception in 2020, we have devoted all of our efforts and financial resources to organizing and staffing our company, business planning, raising capital, acquiring, discovering product candidates and securing related intellectual property rights and conducting research and development activities for our programs. We do not have any products approved for sale and have not generated any revenue from product sales. We may never be able to develop or commercialize a marketable product. We have not yet successfully completed any pivotal clinical trials, obtained any regulatory approvals, manufactured a commercial-scale drug, or conducted sales and marketing activities. Our Strategy Our strategy is to build a global biopharmaceutical company through the identification, development, and commercialization of therapeutics to address unmet medical needs in oncology with an initial focus on patients with OCCC and endometrioid ovarian cancers. We intend to leverage our core competencies of target selection, drug profiling and clinical and regulatory execution to build a pipeline of product candidates targeting cancers driven by genetic alterations. The key elements driving our business strategy include: establishing a leadership position in targeted oncology therapeutics, utilizing the synthetic lethality approach by inhibiting the HSF1 pathway in ARID1a-mutated cancers and/or protein deficiency as a biomarker; advancing our lead product candidate, NXP800, through clinical development towards regulatory decision-making in OCCC and endometrioid ovarian cancer; maximizing the therapeutic potential for NXP800 by leveraging in vivo preclinical data in additional ARID1a-mutated tumor types, as a monotherapy and possibly in combination with other approved therapies; positioning NXP900 as a differentiated SRC kinase inhibitor with improved activity against solid tumors compared to the existing SRC kinase inhibitors; maximizing the therapeutic potential of NXP900 by generating additional in vivo preclinical data to highlight the benefits of inhibiting YES1 on antitumor activity; deploying our proven clinical, regulatory and business development/licensing expertise to further expand our targeted oncology pipeline for patients with unmet medical needs; and evaluating opportunities to accelerate development timelines and enhancing the commercial potential of our products in collaboration with third parties, including potential ex-U.S. collaboration opportunities. Risk Factors An investment in our Common Stock is subject to a broad range of risks and should only be made after a careful consideration of such risks. For a discussion of some of the risks you should consider before purchasing our Common Stock, you are urged to carefully review and consider the section entitled "Risk Factors." 2
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diff --git a/parsed_sections/prospectus_summary/2022/PEPG_pepgen-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/PEPG_pepgen-inc_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/PLSAY_polestar_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/PLSAY_polestar_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/PMN_promis_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/PMN_promis_prospectus_summary.txt
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+PROSPECTUS SUMMARY The following summary highlights selected information included in greater detail elsewhere in this prospectus. This summary is not complete and does not contain all of the information you should consider or that may be important to you in making an investment decision. You should carefully read the entire prospectus before making an investment in our common shares. You should carefully read this entire prospectus, including the information under, Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations and the financial statements included elsewhere in this prospectus. The Company Corporate Information ProMIS Neurosciences Inc. was incorporated on January 23, 2004 under the name 4203801 Canada Inc. pursuant to the CBCA. The Company changed its name to Amorfix Life Sciences Ltd. on August 24, 2004 and to ProMIS Neurosciences Inc. effective July 8, 2015. On June 21, 2022, the directors of the Company authorized a reverse share split of the issued and outstanding Common Shares in a ratio of 60:1, effective June 28, 2022 (the Reverse Share Split ). All information included in this registration statement has been adjusted to reflect the Reverse Share Split. Unless otherwise stated herein, all share and per share numbers relating to the Company s Common Shares prior to the effectiveness of the Reverse Share Split have been adjusted to give effect to the Reverse Share Split, including the financial statements and notes thereto. See Description of the Registrant s Securities to be Registered on page 131 for more information about our Common Shares. The Company s Common Shares are listed on the TSX and the Nasdaq under the symbol, PMN. Our head office is located at 1920 Yonge Street, Suite 200, Toronto, Ontario, Canada M4S 3E2 and our registered and records office is located at 1055 West Georgia Street, Vancouver, British Columbia, Canada V6E 4N7. Our telephone number is (416) 847-6898 and our website address is www.promisneurosciences.com. The information provided on our website is not part of this registration statement. Intercorporate Relationships ProMIS has one wholly-owned U.S. subsidiary, ProMIS Neurosciences (US) Inc. ( ProMIS USA ), which was incorporated in Delaware on January 14, 2016. ProMIS USA has had no material activities to date. Implications of Being an Emerging Growth Company As a company with less than $1.07 billion in revenue during our most recently completed fiscal year, we qualify as an emerging growth company as defined in Section 2(a) of the Securities Act of 1933, as amended, which we refer to as the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As an emerging growth company, we may take advantage of specified reduced disclosure and other exemptions from requirements that are otherwise applicable to public companies that are not emerging growth companies. These provisions include: Reduced disclosure about our executive compensation arrangements; Exemptions from non-binding shareholder advisory votes on executive compensation or golden parachute arrangements; Our election under Section 107(b) of the JOBS Act to delay adoption of new or revised accounting standards with different effective dates for public and private companies until those standards would otherwise apply to private companies; and Exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting. We may take advantage of these exemptions for up to five years or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company if we have more than TABLE OF CONTENTS $1.07 billion in annual revenues as of the end of a fiscal year, if we are deemed to be a large-accelerated filer under the rules of the SEC or if we issue more than $1.0 billion of non-convertible debt over a three-year period. You should rely only on the information contained in this document or to which we have referred you. We have not authorized anyone to provide you with information that is different. You should assume that the information contained in this document is accurate as of the date of this registration statement, as may be amended from time to time (the Registration Statement ), only. On June 22, 2022, the Company filed a Registration Statement on Form 10, as subsequently amended on June 30, 2022 and July 1, 2022 (the Form 10 Registration Statement ), which became effective on July 7, 2022 (the Effective Date ). Upon the Effective Date, the Company became subject to the reporting requirements of Section 13(a) under Securities Exchange Act of 1934, as amended (the Exchange Act ) and is required to file annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, and is required to comply with all other obligations of the Exchange Act applicable to issuers with securities registered pursuant to Section 12(b) of the Exchange Act. On July 8, 2022, the Company s Common Shares began trading on the Nasdaq. Concurrent with the listing of ProMIS Common Shares on the Nasdaq, the Common Shares ceased to be quoted on the OTCQB. Our SEC filings are available to the public on a website maintained by the SEC located at www.sec.gov. We also maintain a website at www.promisneurosciences.com. Through our website, we make available, free of charge, annual, quarterly and current reports, proxy statements and other information as soon as reasonably practicable after they are electronically filed with, or furnished to, the SEC. The information contained on, or that may be accessed through, our website is not part of, and is not incorporated into, this prospectus. TABLE OF CONTENTS
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diff --git a/parsed_sections/prospectus_summary/2022/PRHIZ_presurance_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/PRHIZ_presurance_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/PRME_prime_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/PRME_prime_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2022/PROK_prokidney_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/PROK_prokidney_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
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@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
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diff --git a/parsed_sections/prospectus_summary/2022/PTLO_portillo_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/PTLO_portillo_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1 SUMMARY HISTORICAL AND PRO FORMA CONSOLIDATED FINANCIAL AND OTHER DATA 24 RISK FACTORS 30 CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS 35 ORGANIZATIONAL STRUCTURE 37 USE OF PROCEEDS 40 DIVIDEND POLICY 41 CAPITALIZATION 42 UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION 43 PRINCIPAL STOCKHOLDERS 53 DESCRIPTION OF MATERIAL INDEBTEDNESS 55 DESCRIPTION OF CAPITAL STOCK 58 SHARES ELIGIBLE FOR FUTURE SALE 64 MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES TO NON-U.S. HOLDERS 67 UNDERWRITING 70 LEGAL MATTERS 80 EXPERTS 80 WHERE YOU CAN FIND MORE INFORMATION 80 INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE 81 You should rely only on the information contained in this prospectus or in any free writing prospectus we may specifically authorize to be delivered or made available to you. Neither we, the selling stockholders nor the underwriters (or any of our or their respective affiliates) have authorized anyone to provide any information other than that contained in this prospectus or in any free writing prospectus prepared by or on behalf of us or to which we have referred you. Neither we, the selling stockholders nor the underwriters (or any of our or their respective affiliates) take any responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We, the selling stockholders and the underwriters (or any of our or their respective affiliates) are not making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus or any free writing prospectus is accurate only as of its date, regardless of its time of delivery or the time of any sale of shares of our Class A common stock. Our business, financial condition, results of operations and prospects may have changed since that date. For investors outside the United States: We, the selling stockholders and the underwriters have not done anything that would permit this offering or the possession or distribution of this prospectus or any free writing prospectus we may provide to you in connection with this offering in any jurisdiction where action for purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of the shares of Class A common stock and the distribution of this prospectus outside the United States. See Underwriting. As permitted under the rules of the SEC, this prospectus incorporates important business information about Portillo s OpCo that is contained in documents that we file with the SEC, but that is not included in or delivered with this prospectus. You may obtain copies of these documents, without charge, from the website maintained by the SEC at www.sec.gov, as well as from other sources. See Where You Can Find More Information and Incorporation of Certain Documents by Reference in this prospectus. Table of Contents PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus or documents incorporated by reference herein, but it does not contain all of the information that you should consider before deciding to invest in our Class A common stock. You should read this entire prospectus carefully, including the matters discussed under the headings Risk Factors, Unaudited Pro Forma Financial Information, and the information that is incorporated in this prospectus by reference to our Annual Report (including, without limitation, matters discussed under the headings Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations and in our consolidated financial statements and related notes), our Quarterly Report on Form 10-Q for the quarterly period ended June 26, 2022 (the 2022 Q2 Quarterly Report ) (including, without limitation, matters discussed under the heading Management s Discussion and Analysis of Financial Condition and Results of Operations and in our unaudited condensed consolidated financial statements and related notes) and the other the filings incorporated by reference herein. See Incorporation of Certain Documents by Reference. In addition, certain statements in this prospectus include forward-looking information that is subject to risks and uncertainties. See Cautionary Note Regarding Forward-Looking Statements. Portillo s: Prepare to Get Obsessed Portillo s serves iconic Chicago street food through high-energy, multichannel restaurants designed to ignite the senses and create a memorable dining experience. Since our founding in 1963 in a small trailer which Dick Portillo called The Dog House, Portillo s has grown to become a treasured brand with a passionate (some might say obsessed) nationwide following. Our diverse menu features all-American favorites such as Chicago-style hot dogs and sausages, Italian beef sandwiches, chopped salads, burgers, crinkle-cut french fries, homemade chocolate cake and milkshakes. We create a consumer experience like no other by combining the best attributes of fast casual and quick service concepts with an exciting energy-filled atmosphere and restaurant model capable of generating tremendous volumes. Nearly all of our restaurants were built with double lane drive-thrus and have been thoughtfully designed with a layout that accommodates a variety of access modes including dine-in, carryout/curbside, delivery and catering in order to quickly and efficiently serve our guests. As of June 26, 2022, we owned and operated 71 Portillo s restaurants across nine states. According to publicly available information, our restaurants generated higher AUVs than any other public fast casual restaurant concept of $8.2 million in 2021. No matter how our guests order from us, our highly productive kitchens and team members consistently serve high-quality food and deliver a memorable guest experience. We believe the combination of our craveable food, multichannel sales model, dedication to operational excellence, and a distinctive culture driven by our team members gives us a competitive advantage and allows us to generate the highest AUVs and Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to Completion, Dated August 8, 2022 PRELIMINARY PROSPECTUS 8,000,000 Shares Portillo s Inc. Class A Common Stock We are offering 8,000,000 shares of our Class A common stock. Our Class A common stock is listed on Nasdaq Global Select Market (the Nasdaq ) under the symbol PTLO. On August 5, 2022, the last sale price of our Class A common stock as reported on Nasdaq was $26.58 per share. We intend to use all of the net proceeds from this offering to purchase LLC Units (as defined herein) from certain Continuing Pre-IPO LLC Members (as defined herein) and to repurchase shares of Class A common stock from the Reorganization Parties (as defined herein) (together such Continuing Pre-IPO LLC Members and such Reorganization Parties, the selling stockholders ) in a synthetic secondary transaction, at a price per LLC Unit or share of Class A common stock, as applicable, equal to the public offering price per share of Class A common stock in this offering, less the underwriting discounts and commissions and any withholding taxes. As a result, Portillo s OpCo will not receive any proceeds from this offering. See Use of Proceeds and Certain Relationships and Related Party Transactions. We have two classes of common stock: Class A common stock and Class B common stock. Each share of Class A common stock and Class B common stock entitles its holder to one vote on all matters presented to our stockholders generally. All of our Class B common stock is held by the Continuing Pre-IPO LLC Members on a one-to-one basis with the number of LLC Units they own. See Description of Capital Stock and Organizational Structure Holding Company Structure and the Tax Receivable Agreement. As a result, the Reorganization Parties and Continuing Pre-IPO LLC Members, together, control any action requiring the general approval of our stockholders, including the election of our Board of Directors (the Board ), the adoption of amendments to our certificate of incorporation and bylaws and the approval of any merger or sale of the Company or substantially all of our assets. We are an emerging growth company as defined under the federal securities laws and, as such, will be subject to reduced public company reporting requirements. See Prospectus Summary Implications of Being an Emerging Growth Company. We are currently a controlled company within the meaning of the corporate governance standards of the Nasdaq. Investing in our Class A common stock involves a high degree of risk. See Risk Factors on page 30. Per Share Total Public offering price $ $ Underwriting discount(1) $ $ Proceeds, before expenses, to us $ $ (1) See Underwriting for additional information regarding underwriter compensation. We have granted the underwriters an option to purchase up to an additional 1,200,000 shares to cover over-allotments from us at the public offering price less the underwriting discount at any time within 30 days from the date of this prospectus. Neither the Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The underwriters expect to deliver the shares against payment in New York, New York on , 2022. Jefferies Morgan Stanley BofA Securities Piper Sandler The date of this prospectus is , 2022. Table of Contents Basis of Presentation We use a 52- or 53-week fiscal year ending on the Sunday prior to December 31, effective beginning with the first quarter of 2019. In a 52-week fiscal year, each quarterly period is comprised of 13 weeks. The additional week in a 53-week fiscal year is added to the fourth quarter. We believe the difference in reporting periods does not have a material impact on comparability. Fiscal 2022 will consist of 52 weeks and Fiscal 2021, 2020 and 2019 each consisted of 52 weeks. Trademarks and Trade Names We own or have the rights to use various trademarks, trade names and service marks, including Portillo s and various logos used in association with our name. Solely for convenience, any trademarks, trade names, service marks or copyrights referred to or used herein are listed without the applicable , or symbol, but such references or uses are not intended to indicate, in any way, that we, or the applicable owner, will not assert, to the fullest extent under applicable law, our or their, as applicable, rights to these trademarks, trade names, service marks and copyrights. Other trademarks, trade names, service marks or copyrights of any other company appearing in this prospectus are, to our knowledge, the property of their respective owners. Market and Industry Information Unless otherwise indicated, market data and industry information used throughout this prospectus is based on management s knowledge of the industry and the good faith estimates of management. We also relied, to the extent available, upon management s review of independent industry surveys and publications and other publicly available information prepared by a number of sources, including Service Management Group ( SMG ), Technomic, The NPD Group, Inc. ( The NPD Group ), and Socialinsider. All of the market data and industry information used in this prospectus involves a number of assumptions and limitations and you are cautioned not to give undue weight to such estimates. Although we believe that these sources are reliable, neither we nor the underwriters can guarantee the accuracy or completeness of this information and neither we nor the underwriters have independently verified this information. Additionally, from time to time, these sources may change their input information or methodologies, which may change the related results. While we believe the estimated market position, market opportunity and market size information included in this prospectus is generally reliable, such information, which is derived in part from management s estimates and beliefs, is inherently uncertain and imprecise. Projections, assumptions and estimates of our future performance and the future performance of the industry in which we operate are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in Risk Factors, Cautionary Note Regarding Forward-Looking Statements and elsewhere in this prospectus. These and other factors could cause results to differ materially from those expressed in our estimates and beliefs and in the estimates prepared by independent parties. In addition, certain market and industry data has been derived from research and whitespace modeling prepared for us in 2020 by Forum Analytics, a leading real estate analytics firm ( Forum Analytics ). We engaged Forum Analytics to prepare a whitespace analysis to identify the Company s potential new unit expansion opportunity in the United States. Additionally, certain information included herein is derived from a consumer survey of NPS scores powered by Dynata LLC ( Dynata ), a global online market research firm, which we commissioned in 2021. Certain Definitions As used in this prospectus, unless otherwise noted or the context requires otherwise: Amended LLC Agreement refers to the limited liability company agreement of Portillo s OpCo. Berkshire refers to Berkshire Partners LLC, a private equity firm. Table of Contents traffic per restaurant among fast casual and quick service restaurants. In 2020, 2021 and the twelve months ended June 26, 2022, the average Portillo s restaurant generated: Drive-thru sales of $4.6 million in 2020, $4.7 million in 2021 and $4.1 million in the twelve months ended June 26, 2022, more than double the throughput of McDonald s average drive thru for each of those periods; Dine-in sales of $1.9 million in 2020, $2.5 million in 2021 and $3.2 million in the twelve months ended June 26, 2022, approximately 90% of Chipotle s 2020 total AUV, approximately equal to their 2021 total AUV of $2.5 million and approximately 115% of their twelve months ended second quarter of 2022 total AUV of $2.7 million; and Delivery sales of nearly $800,000 in 2020, and $900,000 in 2021 and $1.0 million in the twelve months ended June 26, 2022, approximately equal to Domino s 2020 average delivery volume, approximately 95% of their 2021 delivery volume and higher than their twelve months ended second quarter of 2022 delivery volume. Each Portillo s location on average served approximately 859,000 guests in 2021 and approximately 847,000 guests in the twelve months ended June 26, 2022, based on our average per-guest spend of approximately $9.49 for the twelve months ended February 28, 2022 and approximately $9.75 for the twelve months ended June 26, 2022 and our AUVs of approximately $8.2 million in 2021 and $8.3 million in the twelve months ended June 26, 2022. Our restaurants are buzzing with the energy and excitement of our team members and guests that bring everyone together, from single diners to large groups, around great food, drinks and fun. Our restaurants have attracted a growing cult-like following that has enabled us to thrive across a variety of suburban and urban trade areas around the country. All of our restaurants are profitable, and we are proud to have never closed a restaurant in our 59-year history. We believe our unique brand experience, passionate following, and compelling everyday value proposition drive strong operating results. As a result, we have been able to achieve the following: Opened 19 new restaurants across 8 states from January 1, 2018 through June 26, 2022 Our industry-leading Restaurant-Level Adjusted EBITDA Margin was 24.1% for the twelve months ended June 26, 2022 Net loss was $16.0 million in the twelve months ended June 26, 2022 Adjusted EBITDA was $93 million in the twelve months ended June 26, 2022 During the quarter and two quarters ended June 26, 2022, we experienced unprecedented commodity inflation as well as higher labor expenses, which will continue to have an impact on Restaurant-Level Adjusted EBITDA and our other profitability metrics for the remainder of 2022. For more information, please see Management s Discussion and Analysis of Financial Condition and Results of Operations in our Q2 2022 Quarterly Report, which is incorporated by reference in this prospectus. Table of Contents Table of Contents Blocker Companies refers to entities treated as corporations for U.S. tax purposes that held LLC Units prior to the Reorganization Transactions (as defined herein) (individually, each a Blocker Company ). Continuing Pre-IPO LLC Members refers to the Pre-IPO LLC Members who retained their equity ownership in Portillo s OpCo in the form of LLC Units immediately following the consummation of the Reorganization Transactions. IPO has the meaning given in Prospectus Summary Organizational Structure. LLC Units has the meaning given in Prospectus Summary Organizational Structure. Mergers has the meaning given in Prospectus Summary Organizational Structure. Pre-IPO LLC Members refers to the pre-IPO owners that directly (or indirectly through a Blocker Company) held LLC Units immediately prior to the consummation of the Reorganization Transactions. Portillo s, the Company, our company, we, us and our refer (i) prior to the consummation of the Reorganization Transactions described under Organizational Structure The Reorganization Transactions, to Portillo s OpCo and its subsidiaries and (ii) after the Reorganization Transactions described under Organizational Structure The Reorganization Transactions, to Portillo s Inc., Portillo s OpCo and their subsidiaries. Portillo s OpCo refers to PHD Group Holdings LLC, a Delaware limited liability company, and, following the Reorganization Transactions, a subsidiary of Portillo s Inc. Reorganization Parties has the meaning given in Prospectus Summary Organizational Structure. Reorganization Transactions has the meaning given in Prospectus Summary Organizational Structure. selling stockholders refers to, collectively, the Continuing Pre-IPO LLC Members and the Reorganization Parties electing to sell LLC Units or shares of our Class A common stock, as applicable, in the synthetic secondary transaction. Sponsor refers to Berkshire. Tax Receivable Agreement refers to the tax receivable agreement entered into with the TRA Parties. TRA Parties refers to, collectively, the Continuing Pre-IPO LLC Members, the Reorganization Parties, and any future party to the Tax Receivable Agreement. Non-GAAP Financial Measures We prepare our consolidated financial statements in accordance with accounting principles generally accepted in the United States of America ( GAAP ). We also supplement our consolidated financial statements with the following non-GAAP financial measures in this prospectus: Adjusted EBITDA, Adjusted EBITDA Margin, Restaurant-Level
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+This summary only highlights portions of the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus, references to: we, us, company or our company are to Cartesian Growth Corporation II, a Cayman Islands exempted company; Class A ordinary shares are to our Class A ordinary shares of par value $0.0001 per share in the share capital of the company; Class B ordinary shares are to our Class B ordinary shares of par value $0.0001 per share in the share capital of the company; Companies Act are to the Companies Act (As Revised) of the Cayman Islands, as the same may be amended from time to time; directorCo is to CGC II Sponsor DirectorCo LLC, a Cayman Islands limited liability company; equity-linked securities are to any debt or equity securities that are convertible, exercisable or exchangeable for Class A ordinary shares issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt; founder shares are to our Class B ordinary shares initially purchased by our sponsor and directorCo in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described below adjacent to the caption Founder shares conversion and anti-dilution rights and in our amended and restated memorandum and articles of association (for the avoidance of doubt, such shares of our Class A ordinary shares will not be public shares ); initial shareholders are to our sponsor, directorCo and the other holders of our founder shares prior to the closing of this offering; management or our management team are to our executive officers, directors and director nominees; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private placement warrants are to the warrants we are selling to our sponsor, Cantor Fitzgerald & Co. and Piper Sandler & Co. and/or their respective designees in a private placement simultaneously with the closing of this offering; public shares and public warrants are to the Class A ordinary shares and warrants, respectively, which are being sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders and public warrant holders are to the holders of our public shares and public warrants, including our sponsor and management team to the extent they purchase public shares or public warrants, provided that their status as public shareholders and public warrant holders shall exist only with respect to such public shares or public warrants; sponsor are to CGC II Sponsor LLC, a Cayman Islands limited liability company; sponsor loan are to the loan our sponsor will be making to us simultaneously with the closing of this offering; and Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED APRIL 28, 2022 $200,000,000 Cartesian Growth Corporation II 20,000,000 Units Cartesian Growth Corporation II is a blank check company newly incorporated as a Cayman Islands exempted company and incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, or reorganization or engaging in any other similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. We have not identified any potential business combination target and we have not, nor has anyone on our behalf, initiated any discussions, directly or indirectly, with any potential business combination target. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share and one-third of one warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as described in this prospectus, and only whole warrants are exercisable. Each warrant will become exercisable on the later of 30 days after the completion of our initial business combination or 12 months from the closing of this offering, and will expire five years after the completion of our initial business combination, or earlier upon redemption or liquidation, as described in the prospectus. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. If we are unable to consummate a business combination within 18 months from the closing of this offering, we will distribute the aggregate amount then on deposit in the trust account described below pro rata to our public shareholders by way of the redemption of their shares and will cease all operations except for the purposes of winding up of our affairs, as further described herein. We have granted the underwriters a 45-day option to purchase up to an additional 3,000,000 units (over and above the 20,000,000 units referred to above). Our sponsor, CGC II Sponsor LLC, Cantor Fitzgerald & Co., the representative of the underwriters, and Piper Sandler & Co. and/or their respective designees have committed to purchase from us an aggregate of 8,000,000 warrants (or 8,900,000 warrants if the underwriters option to purchase additional units is exercised in full), or private placement warrants, at a price of $1.00 per warrant ($8,000,000 in the aggregate, or $8,900,000 if the option to purchase additional units is exercised in full) in a private placement that will close simultaneously with the closing of this offering. Of those 8,000,000 private placement warrants (or up to 8,900,000 private placement warrants if the option to purchase additional units is exercised in full), our sponsor has agreed to purchase 6,000,000 warrants (or up to 6,600,000 warrants if the option to purchase additional units is exercised in full), Cantor Fitzgerald & Co. has agreed to purchase 1,650,000 warrants (or up to 1,897,500 warrants if the option to purchase additional units is exercised in full), and Piper Sandler & Co. has agreed to purchase 350,000 warrants (or up to 402,500 warrants if the option to purchase additional units is exercised in full). Each private placement warrant is exercisable to purchase one Class A ordinary share at $11.50 per share. In addition, our sponsor has agreed to lend us an aggregate of $4,000,000 (or $4,600,000 if the underwriters over-allotment option is exercised in full) as of the closing date of this offering at no interest, which we refer to throughout this prospectus as our sponsor loan. The proceeds of the sponsor loan will be added to the trust account (as described in this prospectus) and be used to fund the redemption of our public shares (subject to the requirements of applicable law) in accordance with the terms set forth in this prospectus. The sponsor loan shall be repaid or converted into sponsor loan warrants at a conversion price of $1.00 per warrant, at the sponsor s discretion. The sponsor loan warrants would be identical to the private placement warrants to be sold to the sponsor, Cantor Fitzgerald & Co. and Piper Sandler & Co. concurrently with the closing of this offering. The sponsor loan is being extended in order to ensure that the amount in the trust account is $10.30 per public share. If we do not complete an initial business combination, we will not repay the sponsor loan from amounts held in the trust account, and the proceeds held in the trust account will be distributed to our public shareholders. Our initial shareholders currently own an aggregate of 5,750,000 Class B ordinary shares, 750,000 of which are subject to forfeiture by our sponsor in the event the underwriters option to purchase additional units is not exercised in full. The total number of Class B ordinary shares issued and outstanding after this offering and the expiration of the underwriters option to purchase additional units will equal 20% of the total number of Class A ordinary shares and Class B ordinary shares issued and outstanding at such time. The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof, on a one-to-one basis, subject to adjustment, as described herein. Prior to our initial business combination, only holders of our Class B ordinary shares will be entitled to vote on the appointment of directors. Table of Contents sponsor loan warrants are to the warrants that may be issued to our sponsor upon conversion of the sponsor loan as described in this prospectus. Each unit consists of one Class A ordinary share and one-third of one warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as described in this prospectus, and only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units into shares and warrants and only whole warrants will trade. Accordingly, unless you purchase at least three units, you will not be able to receive, trade, or benefit from the warrants. Any forfeiture of shares described in this prospectus will take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as a capitalization of profits, share premium or the capital redemption reserve, each as a matter of Cayman Islands law. Registered trademarks referred to in this prospectus are the property of their respective owners. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their option to purchase additional units. Overview We are a blank check company newly incorporated as a Cayman Islands exempted company and incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, or reorganization or engaging in any other similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. We have not identified any potential business combination target and we have not, nor has anyone on our behalf, initiated any discussions, directly or indirectly, with any potential business combination target. Additionally, we have not contacted any of the prospective target businesses that Cartesian Growth Corporation ( CGC I ), an existing special purpose acquisition company ( SPAC ) sponsored by affiliates of our sponsor, had considered and rejected while such entity was a blank check company searching for target businesses to acquire. However, we may contact such targets in the future if we become aware that the valuations, operations, profits or prospects of such target business, or the benefits of any potential transaction with such target business, would be attractive. We have conducted no operations and have generated no revenues to date, and we will not generate operating revenues until, at the earliest, after we consummate our initial business combination. While we may pursue our initial business combination in any business industry or sector, we intend to focus on seeking high-growth businesses with proven or potential transnational operations or outlooks in order to capitalize on the experience, reputation, and network of our management team. Furthermore, we intend to seek target business where we believe we will have an opportunity to drive ongoing value creation after our initial business combination is completed, as our management team has done with multiple investments over a wide range of sectors, industries and geographical locations. Although we anticipate acquiring a target business that is an operating business, we are not obligated to do so and may determine instead to merge with or acquire a company with no operating history if the terms of the transaction are determined by us to be favorable to our public shareholders and the target business has a fair market value of at least 80% of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable, if any, on the income accrued on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. In such event, investors would not have the benefit of basing the decision on whether to remain with our company following such transaction on the past operations of such target business. Furthermore, in such a situation, many of the acquisition criteria and Table of Contents There is currently no public market for our units, Class A ordinary shares or warrants. We have applied to have our units listed on the Nasdaq Global Market, or Nasdaq, under the symbol RENEU on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on Nasdaq. The Class A ordinary shares and warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus unless Cantor Fitzgerald & Co. informs us of its decision to allow earlier separate trading, subject to our filing a Current Report on Form 8-K with the Securities and Exchange Commission, or the SEC, containing an audited balance sheet reflecting our receipt of the gross proceeds of this offering and issuing a press release announcing when such separate trading will begin. Once the securities comprising the units begin separate trading, we expect that the Class A ordinary shares and warrants will be traded on Nasdaq under the symbols RENE and RENEW, respectively. We cannot assure you that any of our securities will continue to be listed on Nasdaq after this offering. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 35 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. This prospectus does not constitute, and there will not be, an offering of securities to the public in the Cayman Islands. Per Unit Total Public offering price $ 10.00 $ 200,000,000 Underwriting discounts and commissions(1) $ 0.70 $ 14,000,000 Proceeds, before expenses, to us $ 9.30 $ 186,000,000 (1) $0.20 per unit sold in the offering, or $4,000,000 in the aggregate (or up to $4,600,000 in the aggregate if the underwriters over-allotment option is exercised in full), is payable to the underwriters upon the closing of this offering. $0.50 per unit sold in the offering, or $10,000,000 in the aggregate (or up to $11,500,000 in the aggregate if the underwriters over-allotment option is exercised in full), is payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States and released to the underwriters only upon the completion of an initial business combination. See also Underwriting for a description of compensation and other items of value payable to the underwriter. Of the proceeds we receive from this offering, the sale of the private placement warrants and the sponsor loan described in this prospectus, $206,000,000, or $236,900,000 if the underwriters option to purchase additional units is exercised in full ($10.30 per unit, regardless of whether or not the underwriters exercise any portion of their option to purchase additional units), will be deposited into a U.S.-based trust account at Morgan Stanley, with Continental Stock Transfer & Trust Company acting as trustee. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, if any, the funds held in the trust account will not be released from the trust account until the earliest to occur of: (i) the completion of our initial business combination, (ii) the redemption of all of our public shares if we are unable to complete our initial business combination within 18 months from the closing of this offering, subject to applicable law, and (iii) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (a) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering or (b) with respect to any other provision relating to shareholders rights or pre-initial business combination activity. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2022. Sole Bookrunner CANTOR Co-Manager Piper Sandler The date of this prospectus is , 2022. Table of Contents guidelines set forth in this prospectus may be rendered irrelevant. If we do not obtain a fairness opinion from an independent investment banking firm that is a member of the Financial Industry Regulatory Authority, or FINRA, or from an independent accounting firm, with respect to such criteria, the fair market value of such a target would be determined by our board of directors based upon one or more standards generally accepted by the financial community, such as actual and potential sales, earnings, cash flow and/or book value, discounted cash flow valuation or value of comparable businesses. We can provide no assurances that our management team s expertise will guarantee a successful initial business combination. In addition, our management team is not required to devote a significant or certain amount of time to our businesses and our management team is currently devoting time to, and is involved with, other businesses. Our Sponsor, Recent SPAC Experience, Board of Directors and Team Members Cartesian Capital Group Our sponsor is an affiliate of Cartesian Capital Group, LLC, or Cartesian, a global private equity firm and registered investment adviser headquartered in New York City, New York. Cartesian has extensive experience providing growth capital to companies around the world. Since its inception in 2006, Cartesian has managed more than $3 billion in committed capital. Cartesian was founded by Peter Yu, who previously founded and served as Chief Executive Officer of AIG Capital Partners, Inc., or AIGCP, a leading international private equity firm with over $4.5 billion in committed capital. Cartesian s team currently consists of 23 professionals, who together have more than 300 years of international private equity experience. Collectively, the Cartesian team has executed more than 55 market-leading investments across 30 countries. Over the years, the Cartesian team has developed an extensive network of relationships, particularly in North America, Europe, South America, and Asia, and an established record of innovative and opportunistic investing, consistent discipline, and significant value creation for all stakeholders. We believe our team has the required analytic, financial, and operational expertise to complete a successful initial business combination and generate attractive risk-adjusted returns for our shareholders. Recent SPAC Experience In December 2020, members of our management team formed CGC I, a blank check company formed for substantially similar purposes as our company. CGC I completed its initial public offering in February 2021, in which it sold 34,500,000 units, each unit consisting of one Class A ordinary share of CGC I and one-third of one warrant to purchase one Class A ordinary share, for an offering price of $10.00 per unit, generating aggregate gross proceeds of approximately $345.0 million. Some members of our management team serve on the management team of CGC I. On September 19, 2021, CGC I entered into a definitive business combination agreement with Tiedemann Wealth Management Holdings, LLC ( TWMH ), TIG Trinity GP, LLC ( TIG GP ), TIG Trinity Management, LLC ( TIG MGMT and together with TIG GP, the TIG Entities ), Alvarium Investments Limited ( Alvarium ), Rook MS LLC ( Umbrella Merger Sub ), and Alvarium Tiedemann Capital, LLC ( Umbrella ) to form Alvarium Tiedemann Holdings, which is expected to be a leading independent, global wealth and asset manager to provide entrepreneurs, multi-generational families, institutions, and emerging next-generation leaders with fiduciary capabilities as well as alternative investment strategies and strategic advisory services. The transaction is expected to close in the first half of 2022, subject to regulatory and shareholder approvals, and other customary closing conditions. We believe that potential sellers of target businesses will view the fact that our management team has negotiated and entered into business combination and merger agreements, as sponsor and as a target, as a positive Table of Contents factor in considering whether or not to enter into a business combination with us. However, past performance of our management team, Cartesian, or its affiliates is not a guarantee of either the ability to successfully identify and consummate an initial business combination or the success of the resulting company. You should not rely on the historical record of management or Cartesian or its affiliates as indicative of future performance. See Risk Factors Past performance by our management team is not indicative of future performance of an investment in us. Our Board of Directors and Team Members Peter Yu has served as our Chief Executive Officer since our inception and will serve as Chairman of our board of directors upon completion of this offering. He also is a Managing Partner of Cartesian. At Cartesian, Mr. Yu led more than 20 investments in companies operating in more than 30 countries. Mr. Yu currently serves on the boards of directors of several companies, including CGC I, Burger King China, Tim Hortons China, PolyNatura Corp., Cartesian Royalty Holdings Pte. Ltd., ASO 2020 Maritime, Flybondi, and Simba Sleep Ltd. Prior to forming Cartesian, Mr. Yu founded and served as the President and Chief Executive Officer of AIGCP. Under his leadership, AIGCP became a leading international private equity firm, with more than $4.5 billion in committed capital. Mr. Yu led numerous investments in several regions and served as Chairman of the investment committee of eight AIGCP private equity funds. Prior to founding AIGCP, Mr. Yu served President Bill Clinton as Director to the National Economic Council, the White House office responsible for developing and coordinating economic policy. A graduate of Harvard Law School, Mr. Yu served as President of the Harvard Law Review and as a law clerk on the U.S. Supreme Court. Mr. Yu received a bachelor s degree from Princeton University s Woodrow Wilson School. In addition to his commercial activities, Mr. Yu serves on the Advisory Council for the Princeton School for Public & International Affairs, the Advisory Council for the Princeton Institute for International & Regional Studies, on the board of directors of The John Paul Stevens Fellowship Foundation and on the Global Council of the Carnegie Endowment for International Peace. Beth Michelson has served as our Chief Financial Officer since our inception and will serve on our board of directors upon completion of this offering. She is also a Senior Managing Director at Cartesian where she has led numerous investments in digital infrastructure, specialized manufacturing and distribution, and telecommunications services. She serves on the boards of directors of Brilia Participacao S.A., BTS Torres, Inc. and Thermal Management Solutions Ltd. She also serves on the Global Advisory Board of Columbia Business School s Chazen Institute for Global Business. Prior to the formation of Cartesian, Ms. Michelson served as Vice President at an affiliate of AIGCP, leading investments in media and telecommunications globally. Earlier in her career, Ms. Michelson was an Associate at Wasserstein Perella Emerging Markets focusing on private equity investments and structured products, and worked in financing for media and entertainment at Dresdner Bank AG. Ms. Michelson, a CFA charterholder, received her Master s in Business Administration and Master of International Affairs from Columbia Business School and Columbia s School of International and Public Affairs, respectively, and holds a bachelor s degree from the University of Michigan. Rafael de Luque will serve on our board of directors upon completion of this offering. He is a Senior Managing Director at Cartesian where he has led transactions in numerous sectors, including in financial services, convenience retail, mobile communications, and legal services. Mr. de Luque currently serves on the boards of directors of Viva Air and Flybondi. Prior to joining Cartesian, Mr. de Luque served as a Vice President at an affiliate of AIGCP, where he specialized in media and content-related investments. Earlier in his career, Mr. de Luque held the position of Financial Consultant at the Inter-American Development Bank. Mr. de Luque, a CFA charterholder, received his Master s in Business Administration from the University of Maryland and holds a bachelor s degree from Universidad de Los Andes in Colombia. Bertrand Grabowski will serve on our board of directors upon completion of this offering. He has over 40 years of experience leading transnational finance companies. He serves on the boards of directors of Cartesian Growth Corporation since February 2021, Flybondi since June 2017 and Jazeera Airways since March 2017. From 2005 to 2016, Mr. Grabowski served as Head of Aviation Finance and as a member of the board of managing Table of Contents directors of DVB Bank, leading the company s global aviation finance and investment initiatives. From 2001 to 2004, Mr. Grabowski was a director of the Asset Finance Group at Citigroup with a focus on Japan and certain E.U. countries. From 1985 to 2001, Mr. Grabowski held various roles at Banque Indosuez, renamed Credit Agricole CIB, including as Head of Aviation Finance for the Americas and branch manager of New York, Head of Aviation Finance for Asia, and as a branch manager of Tokyo. Mr. Grabowski started his career at Soci t Navale Delmas-Vieljeux, where he was in charge of all aspects of financing of new vessels for the shipping company from 1981 to 1984. Mr. Grabowski received his Master s in Business Administration from the ESSEC Business School (Paris). Daniel Karp will serve on our board of directors upon completion of this offering. Mr. Karp, and the teams he has led, have executed dozens of mergers & acquisitions (M&A) and collaboration transactions, totaling over $80 billion in potential deal value. Mr. Karp is the Senior Vice President, Head of Business Development at Organon & Co., a global pharmaceutical company focused on woman s health since January 2021. At Organon, Mr. Karp leads global M&A, collaborations, alliance management, and integration. He also serves on the board of directors of Cartesian Growth Corporation since February 2021. From June 2018 to March 2020, he served as Executive Vice President, Corporate Development at Biogen Inc. Prior to joining Biogen Inc., Mr. Karp held a number of positions of increasing responsibility at Pfizer Inc., including as Vice President, Worldwide Business Development and Head of Business Development for Worldwide Research and Development from May 2016 to June 2018, as Vice President, Worldwide Business Development and Business Development Lead for Pfizer Vaccines, Oncology and Consumer Healthcare from January 2014 to May 2016, as Senior Director, Worldwide Business Development from December 2010 to December 2013, as Director, Worldwide Business Development from January 2008 to December 2010, as Senior Manager, Worldwide Business Development from May 2007 to December 2007 and as Manager, U.S. Business Development from July 2006 to April 2007. Prior to that, Mr. Karp held roles in healthcare and life sciences strategy consulting. Mr. Karp holds a Master of Business Administration from the Wharton School of the University of Pennsylvania and a bachelor s degree in Biology from Duke University. Allan Leighton will serve on our board of directors upon completion of this offering. He is an internationally recognized business leader and currently serves on the board of directors of multiple companies, including Co-Operative Group, Canal and River Trust, Element Materials Technology, Allbright, Northern Bloc, Simba Sleep, C&A AG, Pizza Express, and BrewDog. Prior to his current responsibilities, Allan served as CEO of Pandora A/S, and before that as President and Deputy Chairman of Loblaw. He led the modernization and transformation of the Royal Mail, ultimately as the organization s longest-serving Chairman. Earlier in his career he served as CEO of Asda Stores Ltd., which he turned around and led to the successful sale to Wal-Mart, and then served as President & CEO of Wal-Mart Europe. In addition, Mr. Leighton previously served as Sales Director at Pedigree Petfoods and as Managing Director and General Sales Manager for Mars. In addition to his commercial activities, Mr. Leighton has served as Chairman at Race for Opportunity, and Business in the Community, as well as Business Ambassador for HRH the Prince of Wales while also serving as Vice Patron of Breast Cancer Care. Mr. Leighton received an Honorary Degree from Cranfield University, an Honorary Fellowship from the University of Lancaster, Doctor of Business Administration from York St John University, and attended the Advanced Management Program at Harvard. Sheryl Schwartz will serve on our board of directors upon completion of this offering. Ms. Schwartz is an internationally recognized investment leader and was identified by Mergers & Acquisitions Magazine as one of the Most Influential Women in the Mid-Market M&A for multiple years. She serves as Chief Investment Officer of Alti Financial, a platform focused on democratizing private equity, since November 2021. From May 2013 to April 2020, she was a Managing Director at Caspian Private Equity, building an investment portfolio of more than $3 billion. Previously, she was a Senior Managing Director at Perseus and Managing Director of Perseus Mezzanine Finance. Earlier in her career, Ms. Schwartz served as Managing Director of Alternative Investments at TIAA, a Fortune 100 diversified financial services firm, where she built an investment Table of Contents portfolio of more than $13 billion. In addition to her commercial activities, Ms. Schwartz also is an Adjunct Professor of Private Equity and Finance at the Fordham Gabelli School of Business, and a board member of the Women s Association of Venture and Equity (WAVE) since 2007. Ms. Schwartz received both her Master s in Business Administration and bachelor s degree from New York University. Assistance from Cartesian In addition to the members of our board of directors, our investment team will include the Cartesian team members noted below. We believe that these individuals have substantial executive expertise that will be helpful in the identification of potential target businesses as well as the successful consummation of a business combination. None of these individuals are required to commit any specified amount of time to our affairs; however, we expect that certain of these individuals will on average dedicate a majority of their professional time on our affairs. Gregory Armstrong is a Senior Managing Director at Cartesian. At Cartesian, Mr. Armstrong led numerous investments in the food service, retail, energy, and infrastructure industries. He also serves on the boards of directors of CGC I, NB Reinsurance Ltd. (where he also serves as a member of the underwriting committee) and Tim Hortons China. Prior to joining Cartesian, Mr. Armstrong served as an associate at AIGCP where he was involved in investments in natural resources, business services, and telecommunications. Mr. Armstrong was previously with Broadview International, a mid-market mergers & acquisitions advisory firm, where he specialized in advising communications infrastructure companies. Mr. Armstrong received his Master s in Business Administration from MIT Sloan School of Management and holds a bachelor s degree in electrical engineering from Princeton University. Paul Hong is a Senior Managing Director at Cartesian where he has led numerous investments in logistics, maritime services, basic industries, and financial services. Mr. Hong currently serves on the boards of directors of Simba Sleep Canada Ltd., Flybondi, ASO 2020 Maritime, and Viva Air. Prior to joining Cartesian, Mr. Hong served as Senior Vice President and General Counsel of AIGCP and participated in the bulk of the firm s investments during his tenure. Prior to joining AIGCP, Mr. Hong practiced law in the corporate and tax departments of Kirkland & Ellis LLP where he specialized in private equity transactions. Mr. Hong received his LL.M. in taxation from New York University School of Law, his J.D. from Columbia Law School, and holds a bachelor s degree in economics from Columbia College. Dylan Avery is an Investment Professional at Cartesian. Prior to joining Cartesian, Mr. Avery worked in various roles in the New Zealand financial sector, including founding a not-for-profit organization focused on financial education, leading a bridge loan financing for affordable housing, and serving at Harbor Asset Management. Mr. Avery received his bachelor s degree from the University of Canterbury with a triple major in finance, international business, and marketing. In addition to his commercial activities, Mr. Avery serves as the Founding Advisor for The Pipeline, a not-for-profit addressing the diversity gap in private markets. Martin Biely is an Investment Professional at Cartesian. Mr. Biely currently serves on the board of directors of Aloo Telecom. Prior to joining Cartesian, Mr. Biely was a Senior Portfolio Manager at First Private Investment Management in Frankfurt, Germany where he managed two long/short equity hedge funds. Mr. Biely received his Master s in International Financial Management from the Martin Luther University of Halle Wittenberg, Germany and University of Economics, Slovakia, and his Master s in Business Administration from the Tuck School of Business at Dartmouth College. Mr. Biely is a CFA charterholder and a Chartered Alternative Investment Analyst. Nam Trinh is an Investment Professional at Cartesian. Mr. Trinh currently serves on the board of directors of Simba Sleep Ltd. and is the chief financial officer of Simba Sleep Canada Ltd. Previously, Mr. Trinh served on the board of directors of Pangaea Logistics Solutions Ltd and was the chief financial officer of Aqua Comms DAC. Prior to joining Cartesian, Mr. Trinh served as an associate at a Wall Street investment bank and in the Table of Contents audit practice at Deloitte. Mr. Trinh received his bachelor s in science in economics from The Wharton School and a BSE in computer science and engineering from The School of Engineering and Applied Science at the University of Pennsylvania. Mr. Trinh is a CFA charterholder. Andrew Wehrley is an Investment Professional at Cartesian. Mr. Wehrley currently serves on the boards of directors of Tim Hortons China and Cartesian Royalty Holdings. Prior to joining Cartesian, Mr. Wehrley was a consultant at Bain & Company in South Africa and the United States. While at Bain, he shaped international expansion strategies and reorganized operations for a variety of transnational clients. Previously, Mr. Wehrley served at Deutsche Bank and the Afghan Ministry of Commerce. Mr. Wehrley received his bachelor s degree from the University of California, Los Angeles, an MBA from the Kellogg School at Northwestern University and a MPA from the Kennedy School at Harvard University. With respect to the above, past performance of our management team, Cartesian, or its affiliates is not a guarantee of either the ability to successfully identify and consummate an initial business combination or the success of the resulting company. You should not rely on the historical record of management or Cartesian Capital Group or its affiliates as indicative of future performance. See Risk Factors Past performance by our management team is not indicative of future performance of an investment in us. Our management team has fiduciary and contractual obligations to Cartesian and its affiliates. We believe that these obligations do not present a material conflict of interest, as our sponsor is wholly-owned by Pangaea Three-B, LP, a private equity fund sponsored by Cartesian and any potential target businesses suitable for us will likely be beyond the investment scale targeted by Pangaea Three-B, LP. Business Strategy Our acquisition and value-creation strategy is to identify and combine with an established high-growth company that can benefit from both a constructive combination and continued value-creation by our management team. We believe that our management team s cycle-tested and distinctive investment approach will contribute to a successful initial business combination and the continued development of the combined company. This approach involves a growth-oriented strategy and disciplined value-creation that the Cartesian team has consistently maintained and refined for over more than 20 years. Cartesian s strategy is to provide growth capital to closely-held firms and assist their development as world-class multinational companies. Our management team has built numerous market-leading transnational companies across a wide range of sectors, regions, and countries. As growth-capital investors, our management team has generated investment returns through intelligent growth and thoughtful internationalization of businesses in cooperation with incumbent owners and management teams. We believe this proven, partnership-driven, skill set should be particularly attractive to potential target companies. In terms of value-creation, our management team has helped companies develop through organic growth, targeted combinations, opportunistic aggregation of individual assets, and fundamental transformations. Our team has worked closely with management teams to develop new market-entry strategies, evaluate acquisition and disposal targets, and implement risk management, business intelligence, and strategic planning functions. We believe that this extensive track record of value creation should also enhance our ability to complete a successful business combination. For more than 20 years, the Cartesian team has employed a consistent strategy to identify and create investment opportunities focusing on long-term continuities and short-term dislocations. We define continuities as large-scale forces (e.g., demographic, industrial, technological) driving global economic change over a multi-decadal period. We define dislocations as inefficiencies that result in a temporary divergence between value and price, whether fueled by macroeconomic, sectoral, corporate, or even familial events. We will employ this same approach to identify potential target businesses. Table of Contents From our longstanding practice, we have developed an extensive network of relationships with commercially successful families and privately held businesses in a wide range of industries and sectors around the world. We have worked closely with the advisors to those families and businesses, who often refer projects, companies, and potential partners to us. We will draw on this network as well as our expertise and relationships globally to develop a robust flow of acquisition opportunities. Acquisition Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines that we consider relevant in evaluating prospective target businesses. We intend to use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet any of these criteria and guidelines. We intend to seek to acquire target businesses that: we believe have meaningful and attractive high-growth potential, whether organic or inorganic; have been identified through a proprietary process rather than a competitive process; we believe have proven business models as we do not intend to assume risks of unproven technologies; have significant transnational operations or attractive potential for transnational operations; operate in a manner consistent with the United Nations Principles for Responsible Investment or can promptly be aligned to operate in accordance with such principles; are led by proven management teams; are owned in large part by a family, management team and/or sponsor that will retain a significant portion of the equity capital of the business after our initial business combination; are supportive of and welcome additional value-creation and institution-building efforts, including enhanced corporate governance and financial transparency, expanded business intelligence and strategic planning activity and improved risk management capabilities; and are willing to participate in our initial business combination on terms that will offer an attractive valuation for our shareholders. These criteria and guidelines are not intended to be exhaustive or inviolate. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general criteria and guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into an initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria and guidelines in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials, as applicable, that we would file with the SEC. Initial Business Combination Nasdaq rules require that our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable, if any, on the income earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. If we do not obtain a fairness opinion from an independent investment banking firm that is a member of FINRA or from an Table of Contents independent accounting firm, with respect to such criteria, the fair market value of such a target would be determined by our board of directors based upon one or more standards generally accepted by the financial community, such as actual and potential sales, earnings, cash flow and/or book value, discounted cash flow valuation, or value of comparable businesses. We can provide no assurances that our management team s expertise will guarantee a successful initial business combination. In addition, our management team is not required to devote a significant or certain amount of time to our businesses and our management team is currently devoting time to, and is involved with, other businesses. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the outstanding equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our initial business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the outstanding equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. Nasdaq rules require that our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable, if any, on the income earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. If our initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as our initial business combination for purposes of a tender offer or for seeking shareholder approval, as applicable. If our securities are not listed on Nasdaq after this offering, we would not be required to satisfy the 80% requirement. However, we intend to satisfy the 80% requirement even if our securities are not listed on Nasdaq at the time of our initial business combination. Our Acquisition Process In evaluating a prospective target business, we expect to conduct a thorough due diligence review that will encompass, among other things, meetings with incumbent management and employees, document reviews, inspection of facilities, as well as a review of financial and other information that will be made available to us. We also expect to utilize our operational and capital planning experience. For more information regarding our management team s experience, please see Proposed Business. Given our experience, we will have the capacity to appropriately source opportunities and conduct a substantial portion of due diligence ourselves, relying less on third parties than many other similar companies. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors, or any of their respective affiliates, although we do not intend to do so. In the Table of Contents event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm that is a member of FINRA or from an independent accounting firm, that our initial business combination is fair to our company from a financial point of view. Each of our officers and directors presently has, and any of them in the future may have additional fiduciary or contractual obligations to other entities, including CGC I (only if it fails to consummate its business combination with TWMH, the TIG Entities and Alvarium), pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. On September 19, 2021, CGC I entered into a definitive business combination agreement with TWMG, TIG GP, TIG MGMT, Alvarium, Umbrella Merger Sub and Umbrella. The transaction is expected to close in the first half of 2022, subject to regulatory and shareholder approvals, and other customary closing conditions. Any such companies, businesses or investments, including CGC I if it fails to consummate its business combination with TWMG, the TIG Entities and Alvarium, may compete with us for acquisition opportunities. If these entities decide to pursue any such opportunity, we may be precluded from pursuing such opportunities. These conflicts may not be resolved in our favor and a potential target business may be presented to another entity prior to its presentation to us. If any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such opportunity to such entity first, including CGC I if it fails to consummate its business combination with TWMH, the TIG Entities and Alvarium, and only present it to us if such entities reject the opportunity and he or she determines to present the opportunity to us. We do not believe, however, that (aside from CGC I if it fails to consummate its business combination with TWMH, the TIG Entities and Alvarium) the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our business combination. Further, while we expect that CGC I will have priority over us with respect to acquisition opportunities if it fails to consummate its business combination with TWMG, the TIG Entities and Alvarium, we believe there are multiple potential opportunities within the industries and geographies of our primary focus, and that CGC I s priority with respect to acquisition opportunities would not have a material impact on our ability to identify a suitable target and to consummate our initial business combination. In addition, we may, at our option, pursue an affiliated joint acquisition with an entity to which an officer or director has a fiduciary or contractual obligation. Any such parties may co-invest with us in the target business at the time of our initial business combination, or we could raise additional proceeds to complete the acquisition by undertaking a specified future issuance to such parties. Post-Acquisition Leadership After the initial business combination, we will seek to apply a rigorous approach to enhancing shareholder value through our participation on the board of directors or through direct involvement with company operations or both. We intend to rely on the extensive professional network of Cartesian, including long term associates and former employees and will assemble a team of industry experts that have relevant expertise to enhance the shareholder value. Corporate Information We are a Cayman Islands exempted company. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is Table of Contents enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (i) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that is held by non-affiliates exceeds $700 million as of the end of that year s second fiscal quarter, and (ii) the date on which we have issued more than $1.00 billion in non-convertible debt during the prior three-year period. References herein to emerging growth company shall have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (i) the market value of our ordinary shares held by non-affiliates exceeds $250 million as of the prior June 30, or (ii) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates exceeds $700 million as of the prior June 30. Our executive offices are located at 505 Fifth Avenue, 15th Floor, New York, New York 10017, and our telephone number is (212) 461-6363. Private Placements On October 20, 2021, we issued an aggregate of 5,750,000 founder shares to our sponsor and directorCo for a total subscription price of $25,000, or approximately $0.004 per share. Such shares are fully paid. We refer to these shares collectively throughout this prospectus as the founder shares. The founder shares held by our sponsor include an aggregate of up to 750,000 shares subject to forfeiture by our sponsor to the extent that the underwriters option to purchase additional units is not exercised in full, so that our initial shareholders will own 20% of our issued and outstanding shares after this offering (assuming they do not purchase units in this Table of Contents offering). Neither our initial shareholders nor any member of our management team has indicated any intention to purchase units in this offering, other than as disclosed in this prospectus. The founder shares are identical to the Class A ordinary shares included in the units being sold in this offering, except as described herein. However, the initial shareholders have agreed (i) to vote any shares owned by them in favor of any proposed business combination and (ii) not to redeem any shares in connection with a shareholder vote or tender offer to approve or in connection with a proposed initial business combination. Additionally, the initial shareholders have agreed not to transfer, assign or sell any of the founder shares (except to certain permitted transferees) until the earlier of (a) one year after the date of the completion of our initial business combination or earlier if, subsequent to our initial business combination, the last reported sale price of our Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, or (b) we consummate a subsequent liquidation, merger, share exchange or other similar transaction which results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property. Our sponsor, Cantor Fitzgerald & Co. and Piper Sandler & Co. have committed to purchase from us an aggregate of 8,000,000 private placement warrants (or 8,900,000 private placement warrants if the underwriters option to purchase additional units is exercised in full) at a price of $1.00 per warrant (approximately $8,000,000 in the aggregate, or $8,900,000 if the option to purchase additional units is exercised in full) in a private placement that will close simultaneously with the closing of this offering. Among the private placement warrants, 6,000,000 warrants (or 6,600,000 warrants if the over-allotment option is exercised in full) will be purchased by our sponsor, 1,650,000 warrants (or 1,897,500 warrants if the over-allotment option is exercised in full) will be purchased by Cantor Fitzgerald & Co. and 350,000 warrants (or 402,500 warrants if the over-allotment option is exercised in full) will be purchased by Piper Sandler & Co. and/or their respective designees. A portion of the proceeds from the sale of the private placement warrants and from the sponsor loan will be added to the net proceeds of this offering and placed in the trust account. The private placement warrants are identical to the warrants included in the units sold in this offering except the private placement warrants will be non-redeemable and may be exercised on a cashless basis, at the holder s option, in each case so long as they continue to be held by the initial purchasers or their permitted transferees. The purchasers have also agreed not to transfer, assign or sell any of the private placement warrants or underlying securities (except to the same permitted transferees as the founder shares and provided the transferees agree to the same terms and restrictions as the permitted transferees of the private placement warrants must agree to, each as described above) until 30 days after the completion of our initial business combination. Sponsor Loan Our sponsor has agreed to lend us an aggregate of $4,000,000 (or $4,600,000 if the underwriters over-allotment option is exercised in full) as of the closing date of this offering at no interest. The proceeds of the sponsor loan will be added to the trust account (as described in this prospectus) and be used to fund the redemption of our public shares (subject to the requirements of applicable law) in accordance with the terms set forth in this prospectus. The sponsor loan shall be repaid or converted into sponsor loan warrants at a conversion price of $1.00 per warrant, at the sponsor s discretion. The sponsor loan warrants would be identical to the private placement warrants to be sold to the sponsor concurrently with the closing of this offering. The sponsor loan is being extended in order to ensure that the amount in the trust account is $10.30 per public share. If we do not complete an initial business combination, we will not repay the sponsor loan from amounts held in the trust account, and the proceeds held in the trust account will be distributed to our public shareholders. A portion of the proceeds from the sale of the private placement warrants and from the sponsor loan will be added to the net proceeds of this offering and placed in the trust account. Table of Contents The Offering In making your decision on whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors of this prospectus. Securities offered 20,000,000 units, at $10.00 per unit, each unit consisting of one Class A ordinary share and one-third of one warrant. Each whole warrant offered in this offering is exercisable to purchase one ordinary share. Only whole warrants may be exercised. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We structured our units to consist of one-third of one warrant exercisable for one Class A ordinary share at a price of $11.50 per share, as compared to units issued by some other similar companies which include whole warrants exercisable for one share, in order to reduce the dilutive effect of the warrants upon completion of a business combination as compared to units that each contain a whole warrant to purchase one share, thus making us, we believe, a more attractive merger partner for target businesses. However, this unit structure may cause our units to be worth less than if they included a whole warrant to purchase one share. Listing of our securities and proposed symbols We anticipate the units, and the Class A ordinary shares and warrants once they begin separate trading, will be listed on Nasdaq under the symbols RENEU, RENE and RENEW, respectively. Trading commencement and separation of Class A ordinary shares and warrants Each of the Class A ordinary shares and warrants will begin separate trading on the 52nd day following the date of this prospectus unless Cantor Fitzgerald & Co. informs us of its decision to allow earlier separate trading, subject to our filing a Current Report on Form 8-K with the SEC containing an audited balance sheet reflecting our receipt of the gross proceeds of this offering and issuing a press release announcing when such separate trading will begin. Once the Class A ordinary shares and warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into Class A ordinary shares and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least three units, you will not be able to receive or trade a whole warrant. Table of Contents Separate trading of the Class A ordinary shares and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A ordinary shares and warrants be traded separately until we have filed with the SEC a Current Report on Form 8-K which includes an audited balance sheet of the company reflecting our receipt of the gross proceeds at the closing of this offering. We will file a Current Report on Form 8-K with the SEC, including an audited balance sheet, promptly upon the consummation of this offering, which is anticipated to take place three business days from the date the units commence trading. The audited balance sheet will reflect our receipt of the proceeds from the exercise of the option to purchase additional units if the option to purchase additional units is exercised on the date of this prospectus. If the underwriters option to purchase additional units is exercised after the date of this prospectus, we will file an amendment to the Form 8-K or a new Form 8-K to provide updated financial information to reflect the exercise of the underwriters option to purchase additional units. Units: Number outstanding before this offering 0 Number to be outstanding immediately after this offering 20,000,000(1) Ordinary shares: Number outstanding before this offering 5,750,000(2)(3) Number to be outstanding immediately after this offering 25,000,000(3) Warrants: Number outstanding before this offering 0 Number of private placement warrants to be sold simultaneously with this offering 8,000,000(4) Number to be outstanding immediately after this offering and sale of private placement warrants 14,666,666(4) 1 Assumes no exercise of the underwriters option to purchase additional units and the forfeiture by our sponsor of 750,000 founder shares. 2 Founder shares are currently classified as Class B ordinary shares, which shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described below adjacent to the caption Founder shares conversion and anti-dilution rights and in our amended and restated memorandum and articles of association. Such Class A ordinary shares delivered upon conversion will not have any redemption rights or be entitled to liquidating distributions from the trust account if we do not consummate an initial business combination. 3 Includes up to 750,000 ordinary shares that are subject to forfeiture by our sponsor depending on the extent to which the underwriters option to purchase additional units is exercised. 4 Assumes no exercise of the underwriters option to purchase additional units. Table of Contents Exercisability: Exercise price $11.50 per share, subject to adjustment as described herein. In addition, if (i) we issue additional Class A ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per Class A ordinary share (with such issue price or effective issue price to be determined in good faith by our board of directors and, in the case of any such issuance to our initial shareholders or their affiliates, without taking into account any founder shares held by them prior to such issuance) (the Newly Issued Price ), (ii) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the completion of our initial business combination (net of redemptions), and (iii) the volume-weighted average trading price of our Class A ordinary shares during the 20 trading day period starting on the trading day prior to the day on which we complete our initial business combination (such price, the Market Value ) is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the Market Value and the Newly Issued Price, and the $18.00 per share redemption trigger price described adjacent to Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00 will be adjusted (to the nearest cent) to be equal to 180% of the higher of the Market Value and the Newly Issued Price. Exercise period The warrants will become exercisable on the later of 30 days after the completion of an initial business combination or 12 months from the closing of this offering. The warrants will expire at 5:00 p.m., New York City time, on the fifth anniversary of our completion of an initial business combination, or earlier upon redemption or liquidation; provided, however, that the private placement warrants issued to Cantor Fitzgerald & Co. and Piper Sandler & Co. will not be exercisable more than five years after the effective date of the registration statement of which this prospectus forms a part in accordance with FINRA Rule 5110(g)(8). On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. No public warrants will be exercisable for cash unless we have an effective and current registration statement covering the Class A ordinary shares issuable upon exercise of the warrants and a current prospectus relating to such Class A ordinary shares and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder (or we permit holders to exercise their warrants on a cashless basis under the circumstances specified in the warrant agreement). Table of Contents Redemption of warrants when the price per Class A ordinary share equals or exceeds $18.00 Once the warrants become exercisable, we may redeem the outstanding warrants (excluding the private placement warrants), in whole and not in part, at a price of $0.01 per warrant: upon a minimum of 30 days prior written notice of redemption, if, and only if, the last reported sale price of our Class A ordinary shares equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a warrant as described under the heading Description of Securities Warrants Public Warrants Anti-dilution Adjustments ) for any 20 trading days within a 30 trading day period ending three business days before we send the notice of redemption to the warrant holders. We will not redeem the warrants as described above unless an effective registration statement under the Securities Act covering the Class A ordinary shares issuable upon exercise of the warrants is effective and a current prospectus relating to those Class A ordinary shares is available throughout the 30-day redemption period. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. None of the private placement warrants will be redeemable by us so long as they are held by the initial purchasers or their permitted transferees. Founder shares On October 20, 2021, we issued an aggregate of 5,750,000 founder shares to our sponsor and directorCo for a total subscription price of $25,000, or approximately $0.004 per share. Such shares are fully paid. Prior to the initial investment in us of $25,000 by our sponsor and directorCo, we had no assets, tangible or intangible. The purchase price of the founder shares was determined by dividing the amount of cash contributed to the company by the number of founder shares issued. The number of founder shares issued was determined based on the expectation that the founder shares would represent 20% of the total number of outstanding public shares and founder shares after this offering. As such, our initial shareholders will own founder shares equal to 20% of the total number of outstanding public shares and founder shares after this offering. If we increase or decrease the size of the offering, we will effect a share dividend or share surrender or redemption or other appropriate mechanism, as applicable, with respect to the Class B ordinary shares, immediately prior to the consummation of the offering in such amount as to maintain the ownership of founder shares by our initial shareholders prior to this offering at 20% of total number of our public shares and founder shares upon the consummation of this offering. Up to 750,000 founder shares will be subject to forfeiture by our sponsor (or its Table of Contents permitted transferees) on a pro rata basis depending on the extent to which the underwriters option to purchase additional units is exercised. Terms of founder shares The founder shares are identical to the public shares included in the units being sold in this offering, except that: prior to our initial business combination, only holders of our Class B ordinary shares have the right to vote on the appointment of directors and may remove a member of our board of directors for any reason prior to the consummation of our initial business combination; the founder shares are subject to certain transfer restrictions, as described in more detail below; our initial shareholders, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed (i) to waive their redemption rights with respect to their founder shares and any public shares purchased during or after this offering in connection with the completion of our initial business combination and (ii) to waive their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within 18 months from the closing of this offering although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold during or after this offering if we fail to complete our initial business combination within the prescribed time frame. If we submit our initial business combination to our public shareholders for a vote, our initial shareholders have agreed to vote their founder shares and any public shares purchased during or after this offering in favor of our initial business combination. As a result, in addition to the founder shares, we would need 7,500,001, or 37.5% (assuming all issued and outstanding shares are voted and the option to purchase additional units is not exercised), or 1,250,001 or 6.25% (assuming only the minimum number of shares representing a quorum are voted and the option to purchase additional units is not exercised), of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination, subject to any higher threshold as is required by Cayman Islands or other applicable law, in order to have such initial business combination approved. Our officers, directors and director nominees have also agreed to (i) waive their redemption rights with respect to their public shares purchased during or after this offering in connection with the completion of our initial business combination and (ii) vote any public shares owned by them immediately before this offering as well as any public shares acquired in this offering or in the aftermarket in favor of our initial business combination; the founder shares will automatically convert into our Class A ordinary shares (which such Class A ordinary shares delivered upon conversion will not have any redemption rights or be entitled Table of Contents to liquidating distributions from the trust account if we fail to consummate an initial business combination) at the time of our initial business combination or earlier at the option of the holders thereof as described below adjacent to the caption Founder shares conversion and anti-dilution rights and in our amended and restated memorandum and articles of association; and the founder shares are entitled to registration rights. Transfer restrictions on founder shares Subject to certain limited exceptions discussed in this prospectus, and set forth in a letter agreement between us and our initial shareholders, the founder shares may not be transferred, assigned or sold until one year after the date of the consummation of our initial business combination or earlier if, subsequent to our initial business combination, (i) the last reported sale price of our Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share splits, share dividends, reorganizations and recapitalizations) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination or (ii) we consummate a subsequent liquidation, merger, share exchange or other similar transaction which results in all of our shareholders having the right to exchange their ordinary shares for cash, securities or other property. We refer to such transfer restrictions throughout this prospectus as the lock-up. Founder shares conversion and anti-dilution rights The founder shares are designated as Class B ordinary shares and will automatically convert into Class A ordinary shares (which such Class A ordinary shares delivered upon conversion will not have any redemption rights or be entitled to liquidating distributions from the trust account if we fail to consummate an initial business combination) at the time of our initial business combination or earlier at the option of the holders thereof at a ratio such that the number of Class A ordinary shares issuable upon conversion of all founder shares will equal, in the aggregate, on an as-converted basis, 20% of the sum of (i) the total number of our ordinary shares issued and outstanding upon completion of this offering, plus (ii) the total number of Class A ordinary shares issued or deemed issued or issuable upon conversion or exercise of any equity-linked securities (as defined herein) or rights issued or deemed issued by the company in connection with or in relation to the completion of the initial business combination, excluding any Class A ordinary shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued, deemed issued, or to be issued, to any seller of a target business in the initial business combination and any private placement warrants issued to our sponsor, the underwriters or any of their affiliates or any member of our management team upon conversion of working capital loans or conversion of sponsor loan warrants. Any conversion of Class B ordinary shares described herein will take effect as a compulsory redemption of Class B ordinary Table of Contents shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. In no event will the Class B ordinary shares convert into Class A ordinary shares at a rate of less than one-to-one. Appointment of directors; voting rights Prior to our initial business combination, only holders of our Class B ordinary shares will have the right to vote on the appointment of directors. Holders of our public shares will not be entitled to vote on the appointment of directors during such time. In addition, under our amended and restated memorandum and articles of association, the holders of our founder shares may, by ordinary resolution under our amended and restated memorandum and articles of association, remove a member of our board of directors for any reason prior to the consummation of our initial business combination. These provisions of our amended and restated memorandum and articles of association may only be amended by a special resolution requiring (i) the affirmative vote of at least 90% of the votes cast by the holders of the issued ordinary shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter or (ii) a unanimous written resolution of the shareholders. Our amended and restated memorandum and articles of association will provide that the term of office of our initial directors will expire at our first annual general meeting. Expression of interest Cantor Fitzgerald & Co. has informed us that it, its affiliates or certain accounts over which it or its affiliates have discretionary authority have expressed an interest in purchasing up to 7.5% of the units to be sold in this offering. However, because indications of interest are not binding agreements or commitments to purchase and are simply expressions of intent, these entities may determine to purchase fewer or no units at all in the offering or may purchase more units than they indicate an interest in purchasing (although all such entities combined have indicated that they do not intend to purchase more than an aggregate of 9.99% of the units offered in this offering). In addition, Cantor Fitzgerald & Co. may allocate fewer or no units offered in this offering to any of these entities. The underwriters will receive the same underwriting discount on any units purchased by these entities as they will on any other units sold to the public in this offering. If any such entity purchases any units in this offering or otherwise in the open market, it has no obligation to (i) vote the underlying shares in favor of any business combination, (ii) refrain from exercising any redemption rights with respect to any shares underlying the units offered in this offering or (iii) hold any such units or underlying shares beyond the consummation of an initial business combination, if any. Any trading decisions made by any of the foregoing entities will be made by them based on market conditions at the time of the proposed sale or redemption. Cantor Fitzgerald & Co. s affiliates will not receive any economic or other interest in our sponsor. Table of Contents Private placement warrants Our sponsor, Cantor Fitzgerald & Co. and Piper Sandler & Co. have committed, pursuant to written agreements, to purchase from us an aggregate of 8,000,000 private placement warrants (or 8,900,000 private placement warrants if the underwriters over-allotment option is exercised in full) at a price of $1.00 per warrant (approximately $8,000,000 in the aggregate, or $8,900,000 if the underwriters over- allotment option is exercised in full), each exercisable to purchase one Class A ordinary share at $11.50 per share, in a private placement that will occur simultaneously with the closing of this offering. Among the private placement warrants, 6,000,000 warrants (or 6,600,000 warrants if the over-allotment option is exercised in full) will be purchased by our sponsor 1,650,000 warrants (or 1,897,500 warrants if the over-allotment option is exercised in full) will be purchased by Cantor Fitzgerald & Co. and 350,000 warrants (or 402,500 warrants if the over-allotment option is exercised in full) will be purchased by Piper Sandler & Co. and/or their respective designees. A portion of the purchase price of the private placement warrants and the funds from the sponsor loan will be added to the proceeds from this offering to be held in the trust account such that at the time of closing $206,000,000 (or $236,900,000 if the underwriters exercise their over-allotment option in full) will be held in the trust account. If we do not complete our initial business combination within 18 months from the closing of this offering, the proceeds from the sale of the private placement warrants and from the sponsor loan held in the trust account will be used to fund the redemption of our public shares (subject to the requirements of applicable law) and the private placement warrants will expire worthless. The private placement warrants are, and any sponsor loan warrants will be, identical to the public warrants, except that the private placement warrants (including the underlying securities) are, and any sponsor loan warrants (including the underlying securities) will be, subject to certain transfer restrictions and the holders thereof are entitled to certain registration rights, as described herein, and the private placement warrants: (i) will not be redeemable by us; (ii) may be exercised by the holders on a cashless basis and (iii) with respect to private placement warrants held by Cantor Fitzgerald & Co. and Piper Sandler & Co. and/or their respective designees, will not be exercisable more than five years from the commencement of sales in this offering in accordance with FINRA Rule 5110(g)(8). If the private placement warrants or sponsor loan warrants are held by holders other than the sponsor, Cantor Fitzgerald & Co. and Piper Sandler & Co. or their permitted transferees, then the private placement warrants and sponsor loan warrants will be redeemable by us in all redemption scenarios and exercisable by the holders on the same basis as the warrants included in the public units. The private placement warrants purchased by Cantor Fitzgerald & Co. and Piper Sandler & Co. or their affiliates are deemed underwriters compensation by FINRA pursuant to Rule 5110 of the FINRA Manual. Table of Contents Sponsor loan Our sponsor has agreed to lend us an aggregate of $4,000,000 (or $4,600,000 if the underwriters over-allotment option is exercised in full) as of the closing date of this offering at no interest. The proceeds of the sponsor loan will be added to the trust account (as described in this prospectus) and be used to fund the redemption of our public shares (subject to the requirements of applicable law) in accordance with the terms set forth in this prospectus. The sponsor loan shall be repaid or converted into sponsor loan warrants at a conversion price of $1.00 per warrant, at the sponsor s discretion. The sponsor loan warrants would be identical to the private placement warrants to be sold to the sponsor concurrently with the closing of this offering. The sponsor loan is being extended in order to ensure that the amount in the trust account is $10.30 per public share. If we do not complete an initial business combination, we will not repay the sponsor loan from amounts held in the trust account, and the proceeds held in the trust account will be distributed to our public shareholders. Transfer restrictions on private placement warrants Subject to certain limited exceptions discussed in this prospectus, the private placement warrants (including the warrants that may be issued upon conversion of working capital loans, the sponsor loan and the Class A ordinary shares issuable upon exercise of the private placement warrants) may not be transferred, assigned or sold until 30 days after the date of the consummation of our initial business combination. See Principal Shareholders Transfer Restrictions on Founder Shares, Private Placement Warrants and Sponsor Loan Warrants. Proceeds to be held in trust account Of the net proceeds of this offering, the private placement warrants and the sponsor loan, $206,000,000 (or $236,900,000 if the underwriters option to purchase additional units is exercised in full), or $10.30 per unit sold to the public in this offering (whether or not the option to purchase additional units is exercised in full or in part), will be placed into a U.S.-based trust account at Morgan Stanley, with Continental Stock Transfer & Trust Company acting as trustee. These proceeds include $10,000,000 (or $11,500,000 if the underwriters option to purchase additional units is exercised in full) in deferred underwriting commissions. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, if any, the funds held in the trust account will not be released from the trust account until the earliest to occur of: (i) the completion of our initial business combination, (ii) the redemption of our public shares if we are unable to complete our initial business combination within 18 months from the closing of this offering, subject to applicable law, and (iii) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (a) to modify the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering or (b) with respect to any other provision relating to shareholders rights or pre-initial business combination activity. The Table of Contents proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. Anticipated expenses and funding sources Except as described above, unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. Notwithstanding the foregoing, there can be released to us, from time to time, any interest earned on the funds in the trust account that we may need to pay our tax obligations. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering, the sale of the private placement warrants and the sponsor loan not held in the trust account, which will be approximately $1,450,000 in working capital after the payment of approximately $550,000 in expenses relating to this offering; and any loans or additional investments from our sponsor, members of our management team or any of their affiliates or other third parties, although they are under no obligation to loan funds or invest in us, and provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of our initial business combination. Conditions to completing our initial business combination There is no limitation on our ability to raise funds privately or through loans in connection with our initial business combination. Nasdaq rules require that our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable, if any, on the income earned on the trust account) at the time of our signing a definitive agreement in connection with our initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm that is a member of FINRA or from an independent accounting firm. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We will complete our initial business combination only if the post-transaction company in which our public shareholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our Table of Contents shareholders prior to the business combination may collectively own a minority interest in the post business combination company, depending on valuations ascribed to the target and us in the business combination transaction. If less than 100% of the outstanding equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test, provided that in the event that the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking shareholder approval, as applicable. Permitted purchases of public shares by our affiliates If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our initial shareholders, directors, executive officers, advisors or any of their affiliates may purchase shares in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Please see Proposed Business Permitted Purchases of our Securities for a description of how such persons will determine from which shareholders to seek to acquire shares. There is no limit on the number of shares such persons may purchase, or any restriction on the price that they may pay. Any such price per share may be different than the amount per share a public shareholder would receive if it elected to redeem its shares in connection with our initial business combination. However, our sponsor, directors, officers, advisors and their affiliates have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. In the event our initial shareholders, directors, officers, advisors or any of their affiliates determine to make any such purchases at the time of a shareholder vote relating to our initial business combination, such purchases could have the effect of influencing the vote necessary to approve such transaction. None of the funds in the trust account will be used to purchase shares in such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Securities Exchange Act of 1934, as amended, or the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Table of Contents Redemption rights for public shareholders upon completion of our initial business combination We will provide our shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, if any, divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.30 per public share, regardless of whether or not the underwriters exercise any portion of their option to purchase additional units. The per-share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. Our initial shareholders, officers, directors and director nominees have entered into letter agreements with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares, and our initial shareholders, officers, directors and director nominees have agreed to waive their redemption rights with respect to any public shares they may acquire during or after this offering, in connection with the completion of our initial business combination. Manner of conducting redemptions We will provide our shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a general meeting called to approve the business combination or (ii) by means of a tender offer. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under the law or stock exchange listing requirements. Asset acquisitions and share purchases would not typically require shareholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding ordinary shares or seek to amend our memorandum and articles of association would require shareholder approval. We may conduct redemptions without a shareholder vote pursuant to the tender offer rules of the SEC unless shareholder approval is required by law or stock exchange listing requirements or we choose to seek shareholder approval for business or other legal reasons. If a shareholder vote is not required and we do not decide to hold a shareholder vote for business or other legal reasons, we may, pursuant to our amended and restated memorandum and articles of association: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers, and Table of Contents file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we and our initial shareholders will terminate any plan established in accordance with Rule 10b5-1 to purchase our Class A ordinary shares in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering more than a specified number of public shares, which number will be based on the requirement that we may not redeem public shares in an amount that would cause our net tangible assets to be less than $5,000,001 (so that we do not then become subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. If public shareholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete the initial business combination. If, however, shareholder approval of the transaction is required by law or stock exchange listing requirements, or we decide to obtain shareholder approval for business or other legal reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules, and file proxy materials with the SEC. If we seek shareholder approval, we will complete our initial business combination only if we obtain an ordinary resolution under our amended and restated articles of association, being (i) the affirmative vote of at least a majority of the votes cast by the holders of the issued ordinary shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter or (ii) a unanimous written resolution of the shareholders. In such case, our initial shareholders have agreed to vote their founder shares and any public shares purchased during or after this offering in favor of our initial business combination. Our officers, directors and director Table of Contents nominees have also agreed to vote any public shares owned by them immediately before this offering as well as any public shares acquired in this offering or in the aftermarket in favor of such proposed business combination. In addition to the founder shares, we would need 7,500,001, or 37.5% (assuming all issued and outstanding shares are voted and the option to purchase additional units is not exercised), or 1,250,001 or 6.25% (assuming only the minimum number of shares representing a quorum are voted and the option to purchase additional units is not exercised), of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination, subject to any higher threshold as is required by the Cayman Islands or other applicable law, in order to have such initial business combination approved. For purposes of seeking approval by way of ordinary resolution under our amended and restated articles of association, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. We intend to give approximately 30 days (but not less than 10 days nor more than 60 days) prior written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination. Each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction. We may require our public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to either tender their certificates to our transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up to two business days prior to the vote on the proposal to approve the business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically. We believe that this will allow our transfer agent to efficiently process any redemptions without the need for further communication or action from the redeeming public shareholders, which could delay redemptions and result in additional administrative cost. If a shareholder fails to tender or deliver such shareholder s certificates and shares as directed in the tender offer document or proxy materials, as applicable, the subject shares will not be redeemed and no payment will be made to the shareholder in respect of such shares. If the proposed business combination is not approved and we continue to search for a target company, we will promptly return any certificates delivered, or shares tendered electronically, by public shareholders who elected to redeem their shares. Our amended and restated memorandum and articles of association will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 (so that we do not then become subject to the SEC s penny stock rules) or any greater net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. For example, the proposed business combination may require: (i) cash consideration to be paid to the Table of Contents target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration we would be required to pay for all public shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all public shares submitted for redemption will be returned to the holders thereof. Limitation on redemption rights of shareholders holding 15% or more of the shares sold in this offering if we hold shareholder vote Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. We believe the restriction described above will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against an initial business combination if such holder s shares are not purchased by us or our management at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with an initial business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, all amounts held in the trust account will be released to us. We will use these Table of Contents funds to pay amounts due to any public shareholders who exercise their redemption rights as described above under Redemption rights for public shareholders upon completion of our initial business combination, to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or the redemption of our public shares, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies, or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our sponsor, officers, directors and director nominees have agreed that we will have only 18 months from the closing of this offering to complete our initial business combination. If we are unable to complete our initial business combination within such 18-month period, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, if any (less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in the case of clauses (ii) and (iii), to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. Our initial shareholders, officers and directors have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to their founder shares if we fail to complete our initial business combination within 18 months from the closing of this offering. However, if they acquire public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted 18-month time frame. Table of Contents The underwriters have agreed to waive their rights to their deferred underwriting commissions held in the trust account in the event we do not complete our initial business combination within 18 months from the closing of this offering and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. Amendments to our memorandum and articles of association prior to our initial business combination Our amended and restated memorandum and articles of association will provide that any of its provisions, including those related to pre-business combination activity, may be amended if approved by special resolution, being (i) the affirmative vote of at least a two-thirds (2/3) majority of the votes cast by the holders of the issued ordinary shares present in person or represented by proxy at a general meeting of the company and entitled to vote on such matter or (ii) a unanimous written resolution of the shareholders, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of at least 65% of our ordinary shares, which is a lower amendment threshold than that of many blank check companies. Our initial shareholders and their permitted transferees, if any, who will collectively beneficially own, on an as-converted basis, 20% the total number of our founder shares and of our Class A ordinary shares upon the closing of this offering (assuming they do not purchase any units in this offering), will participate in any vote to amend our amended and restated memorandum and articles of association and/or trust agreement and will have the discretion to vote in any manner they choose. It may be easier for us, therefore, to amend our memorandum and articles of association to facilitate the consummation of an initial business combination that some of our shareholders may not support. Our sponsor, officers, directors and director nominees have agreed, each pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association that would affect the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 18 months from the closing of this offering, unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account and not previously released to us to pay our taxes, if any, divided by the number of then outstanding public shares. However, we may not redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 (so that we do not then become subject to the SEC s penny stock rules). Table of Contents Limited payments to insiders There will be no finder s fees, reimbursements or cash payments made to our sponsor, officers or directors, or our or their affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination, other than the following payments, none of which will be made from the proceeds of this offering, the private placement warrants and the sponsor loan held in the trust account prior to the completion of our initial business combination: Repayment of up to a total of $250,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; Reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; Payment of a fee and grant of an option to each of our independent directors, as described in Management Executive Officer and Director Compensation; Repayment of the sponsor loan in an amount up to $4,000,000 (or $4,600,00 if the underwriters over-allotment option is exercised in full). The sponsor loan shall be repaid or converted into sponsor loan warrants at a conversion price of $1.00 per warrant, at the sponsor s discretion; Repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto; but up to $1,500,000 of such loans may be convertible into warrants at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants, including, as to exercise price, exercisability and exercise period. We do not expect to seek loans from parties other than our sponsor or an affiliate of our sponsor as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our trust account. If we do not complete a business combination, the loans may not be repaid; Payment to an affiliate of our sponsor of up to $10,000 per month, for up to 18 months, for office space, utilities, secretarial support and administrative services; and At the closing of our initial business combination, we may pay customary financial consulting fees. We may pay such financial consulting fees in the event our initial shareholders, officers, directors or their affiliates provide us with specific target company, industry, financial or market expertise, as well as insights, relationships, services or resources in order to assess, negotiate and consummate an initial business combination. The amount of any such financial consulting fee we pay will be based Table of Contents upon the prevailing market for similar services for comparable transactions at such time, and will be subject to the review of our audit committee pursuant to the audit committee s policies and procedures relating to transactions that may present conflicts of interest. We would disclose any such fee in the proxy or tender offer materials used in connection with a proposed business combination. Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliates. Audit Committee We will, prior to the consummation of this offering, establish and maintain an audit committee composed entirely of independent directors. Our audit committee will, among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled Management Committees of the Board of Directors Audit Committee. Conflicts of Interest Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities, including CGC I (only if it fails to consummate its business combination with TWMG, the TIG Entities and Alvarium), pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. These entities, including CGC I if it fails to consummate its business combination with TWMG, the TIG Entities and Alvarium, may compete with us for acquisition opportunities. If these entities decide to pursue any such opportunity, we may be precluded from pursuing such opportunities. These conflicts may not be resolved in our favor and a potential target business may be presented to another entity prior to its presentation to us. If any of our officers or directors becomes aware of a business combination opportunity which is suitable for one or more entities to which he or she has fiduciary, contractual or other obligations or duties, he or she will honor these obligations and duties to present such business combination opportunity to such entities first, including CGC I if it fails to consummate its business combination with TWMG, the TIG Entities and Alvarium, and only present it to us if such entities reject the opportunity and he or she determines to present the opportunity to us. For more information, see the section entitled Management Conflicts of Interest. We do not believe, however, that (aside from CGC I if it fails to consummate its business combination with TWMG, the TIG Entities and Alvarium) the fiduciary, contractual or other obligations or duties of our officers or directors will materially affect our ability to complete our initial business combination. Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2022/RNGR_ranger_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/RNGR_ranger_prospectus_summary.txt
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+This summary highlights selected information appearing elsewhere in this prospectus. Because it is a summary, it may not contain all of the information that may be important to you. To understand this offering fully, you should read this entire prospectus and the documents incorporated by reference, including the information set forth under the heading Risk Factors therein and our financial statements, before making an investment decision. RANGER ENERGY SERVICES, INC. Overview Ranger Energy Services, Inc. ( Ranger, the Company, or we ) is a provider of onshore high specification ( high-spec ) well service rigs, wireline services, and additional processing solutions and ancillary services in the United States. We provide an extensive range of well site services to leading U.S. exploration and production ( E P ) companies that are fundamental to establishing and enhancing the flow of oil and natural gas throughout the productive life of a well. Our focus has been positioning ourselves to serve a high-quality customer base by leveraging our young fleet, improving systems and streamlining processes, making Ranger an operator of choice for U.S. E P companies that require completion and production services. Our service offerings consist of well completion and maintenance support, wireline, including service rigs, and other complementary services, which are conducted in three reportable segments, as follows High Specification Rigs. Provides high-spec well service rigs and complementary equipment and services to facilitate operations throughout the lifecycle of a well. Wireline Services. Provides services necessary to bring and maintain a well on production and consists of our wireline completion and wireline production and pump down lines of business. Processing Solutions and Ancillary Services. Provides other services often utilized in conjunction with our High Specification Rigs and Wireline Services segments. These services include equipment rentals, plug and abandonment, logistics hauling, processing solutions, as well as snubbing and coil tubing. We operate in most of the active oil and natural gas basins in the United States, including the Permian Basin, Denver-Julesburg Basin, Bakken Shale, Eagle Ford Shale, Haynesville Shale, Gulf Coast, South Central Oklahoma Oil Province and Sooner Trend Anadarko Basin Canadian and Kingfisher Counties plays. Our Corporate Information Our principal executive offices are located at 10350 Richmond Avenue, Suite 550, Houston, Texas 77042, and our telephone number at that address is (713) 935-8900. Our website address is www.rangerenergy.com. Information contained on our website does not constitute a part of this prospectus. For additional information about the Company, please read the documents listed under the heading Important Information Incorporated by Reference.
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diff --git a/parsed_sections/prospectus_summary/2022/RPDL_rapid_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/RPDL_rapid_prospectus_summary.txt
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+Prospectus Summary 1 General Information about Our Company 1 The Offering 4 Risk Factors 5 Risk Factors Associated With Our Company 5 Risk Factors Associated With This Offering 10 Forward Looking Statements 13 Use of Proceeds 14 Determination of Offering Price 15 Dilution Of The Price You Pay For Your Shares 15 Plan of Distribution 16 Terms of the Offering 16 Deposit Of The Offering Proceeds 17 Procedures And Requirements For Subscription 17 Description of Securities 17 Experts 17 Description of Business 18 Legal Proceedings 25 Market for Common Equity and Related Stockholder Matters 26 Financial Information 27 Management's Discussion and Analysis of Financial Condition and Results of Operations 28 Changes In and Disagreements with Accountants on Accounting and Financial Disclosure 31 Directors, Executive Officers, Promoters and Control Persons 32 Executive Compensation 34 Security Ownership of Certain Beneficial Owners and Management 36 Certain Relationships and Related Transactions 36 Indemnification for Securities Act Liabilities 36 Where You Can Find More Information 37 i Rapid Line Inc. Gieldowa 4A, Warsaw 01-211, Poland +48222196622 CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS This prospectus contains forward-looking statements which relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "should", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled "Risk Factors" that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested herein. Except as required by applicable law, including the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements to actual results. PROSPECTUS SUMMARY As used in this prospectus, references to the "Company", "we", "our", "us", "Rapid Line" refer to Rapid Line Inc. unless the context otherwise indicates. Rapid Line Inc. is a development stage company incorporated in Wyoming on January 10, 2022. Our financial statements from inception January 10, 2022, through January 31, 2022, report no revenues, net loss of $731 and the Company has negative working capital of $129. Cash and cash equivalents were $51 as of January 31, 2022. We believe our cash balance is not sufficient to fund our operations for any period of time. We have been utilizing and may utilize funds from Wiktor Moroz, our CEO and Director, who has informally agreed to advance funds to allow us to pay for offering costs, filing fees, professional fees, etc. for the period of twelve months. Those funds are non-interest bearing. After twelve months period we may need additional financing. We do not currently have any arrangements for additional financing. Our independent auditor has issued an audit opinion for our Company, which includes a statement expressing a doubt as to our ability to continue as a going concern. The following summary highlights selected information contained in this prospectus. Before making an investment decision, you should read the entire prospectus carefully, including the "Risk Factors" section, the financial statements, and the notes to the financial statements.
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diff --git a/parsed_sections/prospectus_summary/2022/RTGN_retinalgen_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/RTGN_retinalgen_prospectus_summary.txt
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+Prospectus Summary 5 Risk Factors 9 Cautionary Note Regarding Forward-Looking Statements 24 Use of Proceeds 24 Selling Stockholders 24 Plan of Distribution 30 Description of Securities 31 Description of Business 33 Market for Common Equity and Related Stockholder Matters 38 Management s Discussion and Analysis of Financial Condition and Results of Operations 38 Management 45 Executive Compensation 46 Security Ownership Of Certain Beneficial Owners And Management 50 Certain Relationships And Related Party Transactions And Director Independence 51 Legal Matters 51 Experts 51 Where You Can Find More Information 51 Financial Statements F-1 -4- PROSPECTUS SUMMARY The following summary is qualified in its entirety by, and should be read together with, the more detailed information and financial statements and related notes thereto appearing elsewhere in this prospectus. Before you decide to invest in our securities, you should read the entire prospectus carefully, including the risk factors and the financial statements and related notes included in this prospectus. Business Overview We are an ophthalmic research and development company focused on developing technologies to screen, monitor, diagnose and treat ocular, optical, and sight-threatening disorders. Our mission is to prevent vision loss and blindness due to diabetic retinopathy and maculopathy through two devices: (1) Retinal Imaging Screening Device, a portable, retinal imaging system providing a 200-degree field of view without requiring pupil dilation; and (2) RetinalCamTM, a home monitoring and imaging device offering real-time communication with physicians available 24/7. One of the effects of diabetes is retinopathy, and subsequent diabetic maculopathy, characterized by loss of visual function through occlusion of image transmission externally, internally or by destruction of the image sensors in the macula themselves. The macula contains the majority and highest density of color and vision light sensors with providing maximum visual image resolution. Signals are passed through the retinal nerve fiber layer to the optic nerve, an extension of the brain, accumulating retinal nerve bundles forming trunks of connections to pass signals to the brain. The final images are processed at the occipital lobe. When the retina degenerates, patients experience loss of vision due to bleeding, retinal detachment, and other factors. Retinopathy in diabetes can also lead to a degenerative maculopathy, a progressive disease that can lead to vision loss and permanent blindness. Early detection for all causes of visual loss leading to macula disruption, destruction and occlusion are critical in preventing blindness in any form, and most importantly where progression is possible. We believe if detected early and properly treated, the progression of retinopathy can be slowed or even stopped, so that vision can be maintained. Currently, the standard of care requires patients physically go into an office to have their pupil dilated, which, among other things, is costly, time consuming and may cause the patient discomfort. Instead of dilating pupils, some physicians opt to instead use a microscope-like device to detect early signs of diabetic retinopathy, but most such devices have a fixed field of view, typically between 20 to 50 degrees, and therefore, because the limited field of view, do not allow view of the periphery, where retinopathy typically begins, and may not detect signs of retinopathy. By the time the retinopathy reaches the center of the eye and can be seen by such instruments with a limited field of view, it can be too late to treat and may result in blindness. Currently, the only way for a physician to see changes in the periphery of the eye is by an exam after dilation through use of an instrument that has a 200 degree field of view. A patient, when seen without a dilated eye exam, may be misled to believe there is no evidence of retinopathy during the early stages because, without dilation, such diagnosis can be easily missed. We are in the process of developing two products aimed at preventing loss of vision. Specifically, we are developing: (1) the RetinalGeniXTM Imaging System, a diabetic non-mydriatic mass retinal imaging and screening device; and (2) the RetinalCamTM, a real-time in-home retinal monitoring, imaging, and physician alert system. RetinalGeniXTM Imaging System Diabetic Non-Mydriatic Mass Retinal Imaging and Screening Device RetinalGeniXTM Imaging System ( RetinalGeniXTM) is a portable diabetic non-mydriatic mass retinal imaging screening device with a high resolution 200-degree field of view. It is intended to be a cost-effective, ultra-wide imaging technology used to examine the periphery of the retina, without the need for dilation. It can also be used to screen patients for neurological diseases and detect early signs of diabetic retinopathy. We believe RetinalGeniXTM may detect a variety of health issues including diabetes, retinopathy, ocular tumors, Alzheimer s and autoimmune diseases, without the discomfort associated with pupil dilation. We believe RetinalGeniXTM will enable ophthalmologists, retinal specialists and optometrists to perform a more accurate screening with an improved field of view. -5- RetinalCamTM Real-Time Patient In-Home Retinal Monitoring, Imaging, and Physician Alert System RetinalCamTM is a patient in-home ocular and retinal monitoring device which allows individuals at high risk of vision loss or blindness to alert their physician of any vision changes on a real-time basis from their home. The images generated by the RetinalCamTM may provide critical information in detecting abnormalities upon onset, potentially preventing degradation of a patient s ocular health that might result in vision loss or blindness, if left untreated. RetinalCamTM connects directly to the internet or uses Wi-Fi to capture and transmit high resolution digital images directly to doctors from a patient s home. Patients at risk include those with obesity, diabetes, cardiovascular disorders, macular degeneration, neurological disorders, ocular tumors, physical disabilities and individuals that lack regular access to eyecare. The images captured by RetinalCamTM may allow patients to detect any changes that may have occurred since their prior screenings. We believe RetinalCamTM may offer an opportunity to prevent blindness by early detection or progression in high-risk individuals. In addition, we believe, future treatments targeted at COVID-19 may have toxic effects on the macula, which would result in an increased need for close monitoring of patients ocular health. In July 2020, a study published in the European Association for the Study of Diabetes Journal, reported 46% of COVID-19 patients with diabetic maculopathy experienced vascular changes in the retina periphery. We anticipate the high incidence of microvascular changes may demonstrate a potential sign of the severity and a risk factor for death in COVID-19 patients with diabetic maculopathy. As of the date of this prospectus, we do not have any products approved for sale and have not generated any revenue from product sales. We believe RetinalGenixTM is a Class II medical device that will require 510(k) clearance from the U.S. Food and Drug Administration ( FDA ). In addition, we believe RetinalCamTM will be considered a Class II exempt medical device because it is non-diagnostic in nature, and therefore, we do not anticipate needing 510(k) clearance from the FDA to market such product. We intend to launch RetinalCamTM in the fall of 2022 and we intend to apply for 510(k) clearance for RetinalGenixTM in 2022. We anticipate that we will need an additional $5,000,000 to complete product design and testing for RetinalGenixTM and RetinalCamTM and submit RetinalGenixTM for FDA clearance. We intend to obtain such funding through the sales of our equity and debt securities and/or through potential strategic partnerships; however, no assurance can be provided that funds will be available to us on acceptable terms, if at all. Recent Developments On December 27, 2021, we entered into an exchange agreement with Sanovas Ophthalmology, LLC pursuant to which we exchanged 28,014,540 shares of our common stock held by Sanovas Ophthalmology, LLC for a pre-funded warrant to purchase up to an aggregate of 28,014,540 shares of our common stock. The pre-funded warrant is immediately exercisable at an exercise price of $0.0001 per share and terminates when exercised in full. On November 21, 2021, our board of directors rescinded the 3,000,000 shares of Series F preferred stock issued to Halo Management Group LLC for lack of contract consideration. Risks Associated with Our Business Our ability to execute on our business strategy is subject to a number of risks, which are discussed more fully in the section titled Risk Factors. Investors should carefully consider these risks before making an investment in our common stock. These risks include, among others, the following: We have generated no revenue from commercial sales to date and our future profitability is uncertain. If we fail to obtain the capital necessary to fund our operations, we will be unable to continue or complete our product development. There is substantial doubt about our ability to continue as a going concern. Our revenues from sales of our products will be dependent upon market acceptance and pricing and reimbursement guidelines, and if we do not achieve market acceptance of our products or pricing and reimbursement levels are inadequate to achieve profitability, our operations will suffer. If our suppliers cannot provide the components we require, our ability to develop and manufacture our products could be harmed. We may face substantial competition in the future and may not be able to keep pace with the rapid technological changes which may result from others discovering, developing or commercializing products before or more successfully than we do. Product liability lawsuits against us could cause us to incur substantial liabilities and to limit commercialization of any products that we may develop. If we fail to accurately forecast demand for our products, we could incur additional costs or experience lost sales. We will be dependent upon third parties for the distribution of our products, and if such third parties are unable to establish and maintain effective sales, marketing and distribution capabilities, we will be unable to successfully commercialize our products. Our intellectual property may not be sufficient to protect our products from competition, which may negatively affect our business. Third parties may assert that our employees or consultants have wrongfully used or disclosed confidential information or misappropriated trade secrets. We are subject to stringent domestic and foreign medical device regulations. Our failure to obtain and maintain clearances or approvals or any regulatory action against us may materially and adversely affect our financial condition and business operations. If we fail to develop and successfully introduce new products and applications or fail to improve our existing products, our business prospects and operating results may suffer. Our shares of common stock are not publicly traded and there can be no assurance that there will be an active market for our shares of common stock in the future. As of January 19, 2022, our directors, executive officers and principal stockholders, and their respective affiliates, beneficially own approximately 81.00% of our outstanding shares of common stock. As a result, these stockholders, acting together, would have the ability to control the outcome of matters submitted to our stockholders for approval. Our First Amended and Restated Certificate of Incorporation and Bylaws provide that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for substantially all disputes between us and our stockholders, which could limit stockholders ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees. -6- Corporate Information We were incorporated in Delaware on November 17, 2017. Our principal executive offices are located at 1450 North McDowell Boulevard, Suite 150, Petaluma, CA 94954 and our telephone number is (415) 578-9583. Our website address is www.retinalgenix.com. The information contained on our website is not incorporated by reference into this prospectus, and you should not consider any information contained on, or that can be accessed through, our website as part of this prospectus or in deciding whether to purchase our securities. Implications of Being an Emerging Growth Company We qualify as an emerging growth company as defined in the Jumpstart our Business Startups Act of 2012 ( JOBS Act ). As an emerging growth company, we expect to take advantage of reduced reporting requirements that are otherwise applicable to public companies. These provisions include, but are not limited to: being permitted to present only two years of audited financial statements, in addition to any required unaudited interim financial statements, with correspondingly reduced Management s Discussion and Analysis of Financial Condition and Results of Operations disclosure in this prospectus; not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended ( Sarbanes-Oxley ); reduced disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements; and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. We may use these provisions until the last day of our fiscal year following the fifth anniversary of the completion of our initial public offering. However, if certain events occur prior to the end of such five-year period, including if we become a large accelerated filer, our annual gross revenues exceed $1.07 billion or we issue more than $1.0 billion of non-convertible debt in any three-year period, we will cease to be an emerging growth company prior to the end of such five-year period. As an emerging growth company, we intend to take advantage of an extended transition period for complying with new or revised accounting standards as permitted by the JOBS Act. To the extent that we continue to qualify as a smaller reporting company, as such term is defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the Exchange Act ), after we cease to qualify as an emerging growth company, certain of the exemptions available to us as an emerging growth company may continue to be available to us as a smaller reporting company, including: (i) not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes Oxley Act; (ii) scaled executive compensation disclosures; and (iii) the requirement to provide only two years of audited financial statements, instead of three years. -7- THE OFFERING Common stock offered by Selling Stockholders: 1,259,368 shares of common stock, par value $0.0001 per share (the Resale Shares ). Offering price: The selling stockholders (the Selling Stockholders ) will sell their Resale Shares at $1.00 per share until our shares are quoted on the OTCQB, OTCQX or listed on a national securities exchange, such as the NYSE American or The Nasdaq Capital Market, and thereafter at prevailing market prices or in privately negotiated transactions. See Plan of Distribution. Common stock outstanding: 14,282,314 shares. Use of proceeds: We will not receive any of the proceeds from the sale of the Resale Shares by the Selling Stockholders. See Use of Proceeds.
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+Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box: If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b 2 of the Exchange Act. Large accelerated filer Accelerated filer Non accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided to Section 7(a)(2)(B) of the Securities Act. The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission acting pursuant to said Section 8(a), may determine. The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED JULY 22, 2022 RAPID THERAPEUTIC SCIENCE LABORATORIES, INC. Units Each Unit Consisting of One Share of Common Stock and One Warrant to Purchase One Share of Common Stock ________________________________________ We are offering up to _____________ Units at an assumed offering price of $______ per Unit, which was the last reported sale price of our common stock on the OTC Pink Market, operated by OTC Markets Group Inc., on July ___, 2022, with each Unit consisting of one share of common stock, $0.001 par value per share, and one warrant to purchase one share of common stock, of Rapid Therapeutic Science Laboratories, Inc., a Nevada corporation (the Registrant , Rapid or the Company ) in a firm commitment underwritten public offering. Each warrant is immediately exercisable for one share of common stock at an exercise price of $______ per share (or _____% of the price of each Unit sold in the offering) and will expire five years from the date of issuance. The Units will not be certificated and the shares of common stock and the warrants comprising such Units are immediately separable and will be issued separately in this offering. Our common stock is presently quoted on the OTC Pink Market, operated by OTC Markets Group Inc., under the symbol RTSL . At present, there is a limited market for our common stock. There is no established trading market for the warrants. We have applied to list our common stock and the warrants on the Nasdaq Capital Market under the symbols RTSL and RTSL WS , respectively. We believe that upon the completion of the offering contemplated by this prospectus, we will meet the standards for listing on the Nasdaq Capital Market. We cannot guarantee that we will be successful in listing our common stock or warrants on the Nasdaq Capital Market; however, we will not complete this offering unless we are so listed. On July 21, 2022, the last reported sale price for our common stock on the OTC Pink Market was $2.15 per share. Quotes of stock trading prices on an over-the-counter marketplace may not be indicative of the market price on a national securities exchange. The assumed offering price used throughout this prospectus has been included for illustration purposes only. The actual offering price may differ materially from the assumed price used in the prospectus and will be determined by negotiations between us and the representatives of the underwriters and may not be indicative of prices that will prevail in the trading market. Effective on January 11, 2022, shareholders holding a majority of our outstanding voting shares (collectively, the Majority Shareholders ), representing an aggregate of 51.4% of the total voting shares as of such date, executed a written consent in lieu of a special meeting of shareholders (the Majority Shareholder Consent ), approving among other things, the grant of discretionary authority for our Board of Directors, without further shareholder approval, to effect a reverse stock split of all of the outstanding common stock of the Company, by the filing of an amendment to our Articles of Incorporation with the Secretary of State of Nevada, in a ratio of between one-for-two and one-for-fifty, with the Company s Board of Directors having the discretion as to whether or not the reverse split is to be effected, and with the exact exchange ratio of any reverse split to be set at a whole number within the above range as determined by the Board of Directors in its sole discretion, at any time before the earlier of (a) December 31, 2022; and (b) the date of the Company s 2022 annual meeting of shareholders (the Shareholder Authority ) and an amendment to our Articles of Incorporation to increase the number of our authorized shares of common stock from 750,000,000 to 800,000,000 (the Authorized Share Increase ). On March 4, 2022, the Board of Directors approved a stock split ratio of 1-for-25 ( Reverse Stock Split ) in connection with the Shareholder Authority, provided that such approval was subject in all cases to approval of such Reverse Stock Split by the Financial Industry Regulatory Authority (FINRA), and the filing of an amendment to the Articles of Incorporation of the Company with the Secretary of State of Nevada. On March 29, 2022, the Company filed a Certificate of Amendment to the Company s Articles of Incorporation with the Secretary of Nevada to effect the Reverse Stock Split and the Authorized Share Increase (the Amendment ), which became effective at 2:00:01 A.M., Central Standard Time, on March 31, 2022. Investing in our securities involves risks. You should carefully consider the Risk Factors starting on page 14 of this prospectus and set forth in the documents incorporated by reference herein before making any decision to invest in our securities. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ - $ - Underwriting discounts and commissions(1) - - Proceeds, before expenses, to us(2) $ - $ - (1)Does not reflect additional compensation to the underwriters in the form of warrants to purchase up to shares of common stock (assuming the over-allotment option is fully exercised) at an exercise price equal to 120% of the public offering price. We have also agreed to reimburse the underwriters for certain expenses. See Underwriting beginning on page 92 for a description of these arrangements. (2)We estimate the total expenses of this offering will be approximately $_________________. Assumes no exercise of the over-allotment option we have granted to the underwriters as described below. We have granted a 45-day option to the representative of the underwriters to purchase up to an additional __________________ shares of common stock and/or warrants to purchase up to ____________ shares of common stock to cover over-allotments, if any (based on assumed offering price of $______ per Unit, which was the last reported sale price of our common stock on the OTC Pink Market, operated by OTC Markets Group Inc., on July___, 2022). The underwriters expect to deliver our shares and warrants to purchasers in the offering on or about __________________ 2022. The date of this prospectus is ______________________ 2022. TABLE OF CONTENTS Page About This Prospectus 1 Cautionary Statement Regarding Forward Looking Statements 2 Prospectus Summary 3
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+PROSPECTUS SUMMARY The following summary highlights selected information contained elsewhere in or incorporated by reference into this prospectus. The summary may not contain all of the information that you should consider before investing in our securities. You should read this entire prospectus, including Risk Factors and the documents incorporated by reference into this prospectus, before making an investment decision. See the Risk Factors section of this prospectus beginning on page 8 for a discussion of the risks involved in investing in our securities. About Us We are a clinical-stage biopharmaceutical company that discovers, develops, and seeks to commercialize next-generation therapeutics for diseases representing significant unmet medical needs and burden to society, patients, and their families. Our current pipeline focuses on the central nervous system, respiratory, and metabolic diseases. We use a chemical genomics driven technology platform and proprietary chemistry to develop new medicines. Our pipeline currently has two drug candidates, RP5063 (brilaroxazine) and RP1208. Both are new chemical entities discovered in-house. We have been granted composition of matter patents for both RP5063 and RP1208 in the United States (U.S.), Europe, and several other countries. Our lead drug candidate, RP5063, is ready for continued clinical development for multiple neuropsychiatric indications. These include schizophrenia, bipolar disorder (BD), major depressive disorder (MDD), attention-deficit/hyperactivity disorder (ADHD), behavioral and psychotic symptoms of dementia or Alzheimer s disease (BPSD), and Parkinson s disease psychosis. Furthermore, RP5063 is also ready for clinical development for two respiratory indications - pulmonary arterial hypertension (PAH) and idiopathic pulmonary fibrosis (IPF). The U.S. Food and Drug Administration (FDA) has granted Orphan Drug designation to RP5063 for the treatment of PAH in November 2016 and IPF in April 2018. On January 10, 2022, the FDA notified us that we may proceed with our Phase 3 RECOVER trial for RP5063. On February 1, 2022, we announced that the first patients have been dosed in our Phase 3 RECOVER trial to assess RP5063 for the treatment of subjects with an acute exacerbation of schizophrenia. On July 27, 2022, we announced that we had enrolled patients in 15 geographically diverse sites across the US. RECOVER is a global Phase 3, randomized, double-blind, placebo-controlled, multicenter study designed to assess the safety and efficacy of RP5063 in approximately 400 patients with acute schizophrenia compared to placebo. Our primary focus is to complete the clinical development of RP5063 for the treatment of acute and maintenance schizophrenia. We are currently developing Phase 2a trial protocols for studies of brilaroxazine in ADHD and PAH and anticipate initiating the Phase 2a studies in Q4 2022. Subject to the receipt of additional financing, we may also continue the clinical development of RP5063 for the treatment of BD, MDD, BPSD, PDP, and IPF. Moreover, subject to the receipt of additional financing, we may also advance the development of our second drug candidate, RP1208, for the treatment of depression and obesity. Business Combination and Domestication On December 14, 2020, our predecessor company, formerly known as Tenzing Acquisition Corp., a British Virgin Islands exempted company ( Tenzing ), and Reviva Pharmaceuticals, Inc., a Delaware corporation (together with its consolidated subsidiaries, Old Reviva ), consummated the transactions contemplated by the Agreement and Plan of Merger, dated as of July 20, 2020 (as amended, the Merger Agreement ), by and among Tenzing, Tenzing Merger Subsidiary Inc., a Delaware corporation and wholly-owned subsidiary of Tenzing ( Merger Sub ), Old Reviva, and the other parties thereto. Pursuant to the Merger Agreement, Merger Sub merged with and into Old Reviva, with Old Reviva surviving as our wholly owned subsidiary. We refer to this transaction as the Business Combination. In connection with and one day prior to the completion of the Business Combination, Tenzing re-domiciled out of the British Virgin Islands and continued as a company incorporated in the State of Delaware, and changed its name to Reviva Pharmaceuticals Holdings, Inc. Prior to the completion of the Business Combination, the Company was a shell company. Following the Business Combination, the business of Old Reviva is the business of the Company. Old Reviva was incorporated in the state of Delaware on May 1, 2006 and its subsidiary, Reviva Pharmaceuticals India Pvt. Ltd., was incorporated on December 23, 2014. Tenzing was formed pursuant to the laws of the British Virgin Islands on March 20, 2018. Implications of Being an Emerging Growth Company We are an emerging growth company as defined in Section 2(a)(19) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible for and intend to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies for as long as we continue to be an emerging growth company, including, but not limited to, (i) the exemption from the auditor attestation requirements with respect to internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act of 2002, as amended, (the Sarbanes Oxley Act ), (ii) the exemptions from say-on-pay, say-on-frequency and say-on-golden parachute voting requirements and (iii) reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements. We will remain an emerging growth company until the earlier of: (i) the last day of the fiscal year (a) following the fifth anniversary of the closing of Tenzing s initial public offering, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer under the Exchange Act, which would occur if the market value of our common equity held by non-affiliates exceeds $700.0 million as of the last business day of our most recently completed second fiscal quarter; or (ii) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. In addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. This allows an emerging growth company to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to avail ourselves of this extended transition period and, as a result, we will adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-public companies instead of the dates required for other public companies. Recent Developments Registered Direct Offering and Private Placement On September 6, 2022, in a registered direct offering, we entered into a securities purchase agreement (the Institutional Purchase Agreement ) with certain of the selling stockholders named herein for the issuance and sale of 1,976,285 shares of Common Stock (the Registered Shares ) at a price per share of $2.53, for aggregate gross proceeds to us of approximately $5.0 million, before deducting the placement agent fees and offering expenses payable by us. On September 6, 2022, in a concurrent private placement, we entered into a purchase agreement (the Private Placement Purchase Agreement, together with the Institutional Purchase Agreement, the Agreements ) with certain of the selling stockholders named herein, including certain entities affiliated with one of our directors, for the issuance and sale of Pre-Funded Warrants to purchase up to an aggregate of 1,383,399 shares of Common Stock at a purchase price of $2.5299 per Pre-Funded Warrant, for aggregate gross proceeds to us of approximately $3.5 million, before deducting the placement agent fees and offering expenses payable by us. The Pre-Funded Warrants were immediately exercisable upon issuance at an exercise price of $0.0001 per share and will expire when the Pre-Funded Warrants are fully exercised. Pursuant to the Agreements, we also sold and issued to the selling stockholders, in a private placement Common Warrants to purchase up to 3,359,684 shares of Common Stock. The Common Warrants were immediately exercisable upon issuance at an exercise price of $2.40 per share and will expire on September 8, 2027. This prospectus covers the resale or other disposition by the selling stockholders of the shares of Common Stock issuable upon the exercise of the Pre-Funded Warrants and Common Warrants. The closing of the issuance and sale of the Registered Shares, Pre-Funded Warrants and Common Warrants was consummated on September 8, 2022. Corporate Information Our principal offices are located at 19925 Stevens Creek Blvd., Suite 100, Cupertino, CA 95014, and our telephone number is (408) 501-888. Our website address is http://revivapharma.com. Our website and the information contained on, or that can be accessed through, our website shall not be deemed to be incorporated by reference in, and are not considered part of, this prospectus. You should not rely on any such information in making your decision whether to purchase our shares of Common Stock. THE OFFERING Shares of Common Stock being offered: Up to 4,743,083 shares of Common Stock issuable upon exercise of the Warrants Use of proceeds: We will not receive any proceeds from the common shares offered by the selling stockholders under this prospectus. However, we will receive the proceeds of any cash exercise of the Warrants. We intend to use the net proceeds from any cash exercise of the Warrants for working capital and general corporate purposes. See Use of Proceeds. Market for Common Stock: Our Common Stock is traded on The Nasdaq Capital Market under the symbol RVPH. On October 3, 2022, the closing price of our Common Stock was $1.68 per share. Risk factors: An investment in our securities involves a high degree of risk. Please see the section entitled Risk Factors beginning on page 8 of this prospectus as well as the other information included in this prospectus for a discussion of factors that you should consider carefully before making an investment decision.
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our securities, you should carefully read this entire prospectus, including our consolidated financial statements and the related notes thereto and the information set forth in the sections titled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations. Overview We are a clinical-stage biopharmaceutical company focused on the development of powerful and proprietary immunotherapeutic polyclonal human antibodies to treat and prevent infectious diseases and immune and autoimmune disorders. Our development programs include infectious diseases resulting from outbreaks and pandemics, as well as immunological, gastroenterological, and respiratory diseases that have significant mortality and health impacts on immunocompromised patients. Using private resources and more than $200 million of funds awarded by the U.S. Government emerging disease and medical countermeasures programs since September 2019, we have developed a novel drug development platform, which we refer to as our DiversitAb platform. This platform is based on the power of the human immune system and has the unique capability to generate large quantities of specifically targeted, high-potency, fully-human natural polyclonal antibodies without the need for convalescent plasma or human donors. Over a span of two decades, our founding scientists have refined, optimized, and advanced genetic engineering and antibody science to develop transchromosomic cattle (which we refer to as Tc Bovine) that produce fully-human antibodies. These Tc Bovine form a key component of our versatile DiversitAb platform. We are leveraging our DiversitAb platform to discover and develop product candidates with the potential to be first-in-class against novel targets or best-in-class against known, complex targets that treat diseases with significant unmet medical needs, including infectious and respiratory diseases, immune and autoimmune disorders, and oncology. Recent Milestones Since September 2019, we have achieved multiple milestones, including: Established proof-of-concept for our DiversitAb platform. Fully enrolled Phase 2a challenge study for SAB-176 in adults infected with influenza virus. Advanced to Phase 3 of NIH-Sponsored ACTIV-2 Trial based upon DSMB at interim analysis for SAB-185 (COVID-19) and reached 50% enrollment. Announced topline data demonstrating that SAB-176 met its primary endpoint in our Phase 2a challenge study in adults infected with influenza virus. Announced that recent data demonstrated that SAB-185 retains neutralization activity against the Omicron variant of SARS-CoV-2 in an in vitro pseudovirus model. Reported positive topline Phase 2 virology data demonstrating SAB-185 met criteria for advancement to Phase 3. Summary of Risk Factors Below is a summary of material factors that make an investment in our securities speculative or risky. Importantly, this summary does not address all of the risks and uncertainties that we face. Additional discussion of the risks and uncertainties summarized in this risk factor summary, as well as other risks and uncertainties that Table of Contents we face, can be found under the section titled Risk Factors in this prospectus. The below summary is qualified in its entirety by that more complete discussion of such risks and uncertainties. You should consider carefully the risks and uncertainties described under the section titled Risk Factors as part of your evaluation of an investment in our securities: We are a clinical-stage biopharmaceutical company and have incurred significant losses since our inception. We realized net loss in the fiscal year ended December 31, 2021, we may incur losses for the foreseeable future and may not be able to generate sufficient revenue to maintain profitability. Our limited operating history makes future forecasting difficult. All of our product candidates are in preclinical or clinical development. Clinical drug development is expensive, time consuming and uncertain, and we may ultimately not be able to obtain regulatory approvals for the commercialization of some or all of our product candidates. The regulatory approval processes of the U.S. Food and Drug Administration (FDA) and comparable foreign authorities are lengthy, time consuming and inherently unpredictable, and if we are ultimately unable to obtain regulatory approval for our product candidates, our business will be substantially harmed. Regulatory approval for the genetic modification of animals, including those from which antibodies are isolated for injection into human patients, requires the approval of a New Animal Drug Application, and if we are ultimately unable to obtain such approval, our business will be substantially harmed. We are highly dependent on the success of our product candidates and if we are unable to successfully complete clinical development, obtain regulatory approval for or commercialize one or more of our product candidates, or if we experience delays in doing so, our business will be materially harmed. If our clinical trials fail to replicate positive results from earlier preclinical studies or clinical trials conducted by us or third parties, we may be unable to successfully develop, obtain regulatory approval for or commercialize our product candidates. The future commercial success of our product candidates will depend on the degree of market acceptance of our potential products among physicians, patients, healthcare payers, and the medical community. Failure to successfully identify, develop and commercialize additional products or product candidates could impair our ability to grow. We depend upon senior management and senior scientific staff, and their loss or unavailability could put us at a competitive disadvantage. We rely on third parties to perform some of our research and preclinical studies and we plan to rely on third parties to conduct our clinical trials. If these third parties do not satisfactorily carry out their contractual duties or fail to meet expected deadlines, our development programs may be delayed or subject to increased costs, each of which may have an adverse effect on our business and prospects. We intend to rely on third parties to produce commercial supplies of our product candidates. We are subject to manufacturing risks that could substantially increase the costs and limit supply of product candidates or prevent us from achieving a commercially viable production process. If we fail to successfully operate our animal production facility, it may adversely affect our clinical trials and the commercial viability of our product candidates. Outbreaks of livestock diseases and other events affecting the health of our bovine herd can adversely impact our ability to conduct our operations and production of our product candidates. Table of Contents Cyber-attacks or other failures in our telecommunications or information technology systems, or those of our collaborators, CROs, third-party logistics providers, distributors or other contractors or consultants, could result in information theft, data corruption and significant disruption of our business operations. We have historically relied on awards from, and contracts with, the U.S. Government to fund our business and operations, and will need to find new and alternative sources of funding following the discontinuance of certain such arrangements. If our competitors develop more effective competing product candidates our business will be substantially harmed. We are subject to stringent environmental regulation and potentially subject to environmental litigation, proceedings, and investigations. Our success may depend on our ability to maintain the proprietary nature of our technology. We may become involved in litigation to protect or enforce our patents or the patents of our collaborators or licensors, which could be expensive and time-consuming. If patent laws or the interpretation of patent laws change, our competitors may be able to develop and commercialize our discoveries. We incur increased costs and demands upon management as a result of complying with the laws and regulations affecting public companies, which could adversely affect our business, financial condition, and results of operations. We are an emerging growth company, and our election to comply with the reduced disclosure requirements as a public company may make our common stock less attractive to investors. If we fail to maintain an effective system of disclosure controls and internal control over financial reporting, our ability to produce timely and accurate financial statements or comply with applicable regulations could be impaired. The market price of our securities may be volatile, which could cause the value of any investment in our securities to decline. We will have broad discretion in how we use the proceeds of this offering and may not use these proceeds effectively, which could affect our results of operations and cause our stock price to decline. We might not be able to comply with the continued listing standards of Nasdaq. Sales of a substantial number of shares of our common stock in the public market could cause our stock price to fall. We may issue additional shares common stock (including upon the exercise of warrants or conversion of preferred stock) which would increase the number of shares eligible for future resale in the public market and result in dilution to our stockholders. If you purchase our common stock in this offering, you will incur immediate and substantial dilution in the book value of your shares. Warrants are speculative in nature, the Warrants may not have any value, and holders of the Warrants will not have any rights as a common stockholder. Changes in tax laws and regulations or exposure to additional tax liabilities could adversely affect our financial results. The risks described above should be read together with the text of the full risk factors described in the section entitled Risk Factors and the other information set forth in this prospectus, including our consolidated financial statements and the related notes. The risks summarized above or described in this prospectus are not the only risks that we face. Table of Contents Additional risks and uncertainties not presently known to us, or that we currently deem to be immaterial may also materially adversely affect our business, financial condition, results of operations and future growth prospects. Corporate Information We were incorporated in the State of Delaware on November 12, 2020, as a special purpose acquisition company under the name Big Cypress Acquisition Corp. (BCYP). On January 14, 2021, BCYP completed its initial public offering. On October 22, 2021, BCYP consummated a business combination with SAB Biotherapeutics, Inc. (the Business Combination ), which changed its name to SAB Sciences, Inc. In connection with the closing of the business combination, BCYP changed its name to SAB Biotherapeutics, Inc. and SAB Sciences, Inc. became a subsidiary of SAB Biotherapeutics, Inc. Our principal executive offices are located at 2100 East 54th Street North Sioux Falls, South Dakota 57104, and our telephone number is (605)-679-6980. Our corporate website address is www.sab.bio . Information contained on or accessible through our website is not a part of this prospectus, and the inclusion of our website address in this prospectus is an inactive textual reference only. We and our subsidiaries own or have rights to trademarks, trade names and service marks that they use in connection with the operation of their business. In addition, their names, logos and website names and addresses are their trademarks or service marks. Other trademarks, trade names and service marks appearing in this prospectus are the property of their respective owners. Solely for convenience, in some cases, the trademarks, trade names and service marks referred to in this prospectus are listed without the applicable , and SM symbols, but they will assert, to the fullest extent under applicable law, their rights to these trademarks, trade names and service marks. Implications of Being an Emerging Growth Company and a Smaller Reporting Company We are an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012, as amended, and therefore we intend to take advantage of certain exemptions from various public company reporting requirements, including not being required to have our internal control over financial reporting audited by our independent registered public accounting firm pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in this prospectus, our periodic reports and our proxy statements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and any golden parachute payments not previously approved. We will remain an emerging growth company until the earliest of (i) the last day of the fiscal year in which the market value of our common stock that is held by non-affiliates equals or exceeds $700 million as of the end of that year s second fiscal quarter, (ii) the last day of the fiscal year in which we have total annual gross revenue of $1.07 billion or more during such fiscal year (as indexed for inflation), (iii) the date on which we have issued more than $1 billion in non-convertible debt in the prior three-year period or (iv) December 31, 2026. We are also a smaller reporting company as defined under the Securities Act of 1933, as amended (the Securities Act ) and the Securities Exchange Act of 1934, as amended (the Exchange Act ). We may continue to be a smaller reporting company so long as either (i) the market value of shares of our common stock held by non-affiliates is less than $250 million or (ii) our annual revenue was less than $100 million during the most recently completed fiscal year and the market value of shares of our common stock held by non-affiliates is less than $700 million. If we are a smaller reporting company at the time we cease to be an emerging growth company, we may continue to rely on exemptions from certain disclosure requirements that are available to smaller reporting companies. Specifically, as a smaller reporting company, we may choose to present only the two most recent fiscal years of audited financial statements in our Annual Report on Form 10-K and have reduced disclosure obligations regarding executive compensation, and, similar to emerging growth companies, if we are a smaller reporting company under the requirements of (ii) above, we would not be required to obtain an attestation report on internal control over financial reporting issued by our independent registered public accounting firm. Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2022/SATLW_satellogic_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/SATLW_satellogic_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/SKKY_skkynet_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/SKKY_skkynet_prospectus_summary.txt
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@@ -0,0 +1,22 @@
+PROSPECTUS SUMMARY
+ 
+This summary highlights information contained elsewhere in this prospectus; it does not contain all the information you should consider before investing in our Common Stock. You should read the entire prospectus before making an investment decision. Throughout this prospectus, the terms the Company , Skkynet , we, us, our, and our company refer to Skkynet Cloud Systems, Inc., a Nevada corporation.
+ 
+Company Overview
+ 
+Skkynet is a Nevada corporation headquartered in Mississauga, Canada. Skkynet operates through its wholly-owned subsidiaries: Cogent Real-Time Systems, Inc. ( Cogent ), Skkynet, Inc. ( Skkynet (USA) ), Skkynet Corp. ( Skkynet (Canada) ). Skkynet was established to enhance Cogent s existing business lines through the integration of cloud-based systems ( Cloud ), and to deliver a Software-as-a-Service ( SaaS ) product targeting the Industrial Internet of Things ( IoT ) market, now referred to by the terms Industry 4.0 and Industrial Internet Consortium . We will also expand the areas of business activity to which our products and services are applied.
+ 
+ 
+3
+
+Table of Contents
+ 
+Where You Can Find Us 
+ 
+The Company principal office is located at 2233 Argentia Road, Suite 306, Mississauga, Ontario, Canada L5N 2X7. The offices are leased from August 1, 2017 through July 31, 2022. The lease is for approximately 2,210 square feet of office space with a gross monthly rental cost including common area charges of $4,097.
+ 
+Current Business
+ 
+Skkynet is a Nevada corporation headquartered in Mississauga, Canada. Skkynet operates three different lines of business through its wholly-owned subsidiaries: Cogent Real-Time Systems, Inc. ( Cogent ), Skkynet, Inc. ( Skkynet (USA) ), Skkynet Corp. ( Skkynet (Canada) ). Skkynet was established to enhance Cogent s existing business lines through the integration of cloud-based systems ( Cloud ), and to deliver a Software-as-a-Service ( SaaS ) product targeting the Industrial Internet of Things ( IoT ) market, now referred to by the terms Industry 4.0 and Industrial Internet Consortium . We will also expand the areas of business activity to which our products and services are applied.
+ 
+<span class="atag" style="display: inline" id="
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diff --git a/parsed_sections/prospectus_summary/2022/SKYH-WT_sky_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/SKYH-WT_sky_prospectus_summary.txt
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+SUMMARY OF THE PROSPECTUS This summary highlights selected information from this prospectus and may not contain all of the information that is important to you in making an investment decision. Before investing in our securities, you should carefully read this entire prospectus, including our financial statements and the related notes included in this prospectus and the information set forth under the headings Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations. See also the section entitled Where You Can Find Additional Information. Unless the context otherwise requires, all references in this prospectus to SHG Corporation, the Company, the registrant, we, us and our refer to Sky Harbour Group Corporation (formerly known as Yellowstone Acquisition Company) and all references in this prospectus to Sky refer to Sky Harbour LLC. The Company We are an aviation infrastructure development company building the first nationwide network of Home-Basing Solutions ( HBS ) for business aircraft. We develop, lease and manage general aviation hangars across the United States, targeting airfields in the largest growth markets with significant aircraft populations and high hangar demand. Our HBS campuses feature exclusive private hangars and a full suite of dedicated services specifically designed for home-based aircraft. As the fleet of private jets in the United States continues to grow, with recent new aircraft deliveries exceeding retirements, demand for hangar space is at a premium in part because the new jets require larger square footage of hangar space and the pace of new hangar construction has lagged behind the demand. The cumulative square footage of the business aircraft fleet in the United States increased 42% between 2010 and 2020. Moreover, over that same period, there was a 70% increase in the square footage of larger private jets - those with greater than a 24-foot tail height. The larger footprint aircraft do not fit in much of the existing hangar infrastructure and impose stacking challenges and constraints in the traditional shared or community hangars operated by fixed-base operators ( FBO ). The addition of winglets (the vertical extensions on aircraft wingtips) on most modern business jets inhibits wing-over-wing storage. Aircraft hangars are in high demand and short supply, with some airports compiling waiting lists that can exceed several years. Our scalable business strategy addresses the increased imbalance between the supply and demand of private jet storage, including the lack of hangar facilities able to accommodate larger aircraft, by growing its portfolio of HBS campuses at key airports across the United States. We target airports with excess demand for private hangar space, typically near metropolitan areas, which include both established and growing markets. We intend to capitalize on the existing hangar supply constraints at major United States airports by targeting high-end tenants in markets where there is a shortage of private and FBO hangar space, or where such hangars are or are becoming obsolete. In contrast with community hangars and other facilities provided by FBOs, the HBS campuses offered by us provide the following features and services: private hangar space for exclusive use of the tenant; adjoining attractive/custom lounge and office suites; dedicated line crews and services; climate control to mitigate condensation and associated corrosion; features to support in-hangar aircraft maintenance; no-foam fire suppression; and UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Table of Contents customized software to provide security, control access and monitor hangar space. We use a standard set of proprietary prototype hangar designs, which are intended to lower construction costs, minimize development risk, expedite permit issuance, and facilitate the implementation of refinements across its portfolio. Hangar features include: ability to accommodate heavy business jets in single configuration, medium jets in twin or triplet configuration, or light jets in multi-configuration; compliance with National Fire Protection Association 409 Group III fire code, eliminating foam fire protection systems, resulting in lower construction costs and operating expenses, as well as eliminating accidental foam discharges and the resultant negative effects on aircraft maintenance and resale value; high-voltage, industrial drainage and impervious floors that support in-hangar maintenance and inspections; and control through smartphone application. Background The Company was originally known as Yellowstone Acquisition Company. On January 25, 2022, YAC consummated the Business Combination with Sky pursuant to the Equity Purchase Agreement dated as of August 1, 2021 between YAC and Sky. In connection with the Closing of the Business Combination, YAC changed its name to Sky Harbour Group Corporation. Sky was deemed to be the accounting acquirer in the Business Combination based on an analysis of the criteria outlined in Accounting Standards Codification 805. While YAC was the legal acquirer of Sky in the Business Combination, because Sky was deemed the accounting acquirer, the historical financial statements of Sky became the historical financial statements of the Company upon the consummation of the Business Combination. On the Closing Date, the following occurred: (a) YAC changed its name to Sky Harbour Group Corporation ; (b) all outstanding shares of Class B Common Stock held by the Sponsor were converted into shares of Class A Common Stock; (c) Sky restructured its capitalization, issued to the Company 14,937,581 Sky Common Units, which was equal to the number of outstanding shares of Class A Common Stock immediately after giving effect to the Business Combination (taking into account the redemption of Class A Common Stock and the Class A Common Stock issued under the BOC PIPE, reclassified the existing Sky Common Units (other than the existing Sky Incentive Units), existing Sky Series A preferred units and the existing Sky Series B preferred units into Sky Common Units; (d) effected certain adjustments to the number of Sky Incentive Units to reflect the new capital structure; (e) appointed the Company as the managing member of Sky; (f) the Sky Common Units issued to BOC YAC in respect of its Series B preferred units were converted into 5,500,000 shares of Class A Common Stock; (h) holders of Sky Common Units received one share of Class B Common Stock for each Sky Common Unit, and as consideration for the issuance of 14,937,581 Sky Common Units by Sky to the Company, YAC contributed to Sky the net amount held in the YAC trust account after deducting the amount required to fund the redemption of the Class A Common Stock held by eligible stockholders who properly elected to have their shares redeemed as of the Closing Date, taking into account the BOC PIPE and the amount of various transaction costs; and (i) without any action on the part of any holder of YAC Warrants, each YAC Warrant that was issued and outstanding immediately prior to the closing became a Warrant. As of the Closing Date, SHG Corporation owned approximately 26.1% of the Sky Common Units, and the Existing Sky Equityholders owned approximately 73.9% of the Sky Common Units and control the Company through their ownership of the Class B Common Stock of the Company. Our Class A Common Stock and Public Warrants are currently listed on the NYSE American under the symbols SKYH and SKYH WS, respectively. The rights of holders of our Class A Common Stock and Warrants are governed by our second amended and restated certificate of incorporation (the Certificate of Incorporation ), our bylaws (the Bylaws ) and the Delaware General Corporation Law (the DGCL ). See the sections entitled Description of our Securities and Certain Relationships and Related Party Transactions. FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Table of Contents The Committed Equity Financing On August 18, 2022, we entered into the Purchase Agreement and a registration rights agreement (the Registration Rights Agreement ) with the Selling Stockholder. Pursuant to the Purchase Agreement, we have the right to sell to the Selling Stockholder up to 10,000,000 shares of our Class A Common Stock (the Total Commitment ), subject to certain limitations and conditions set forth in the Purchase Agreement, from time to time during the term of the Purchase Agreement. Sales of Class A Common Stock to the Selling Stockholder pursuant to the Purchase Agreement, and the timing of any such sales, are solely at our option, and we are under no obligation to sell any securities to the Selling Stockholder under the Purchase Agreement. In accordance with our obligations under the Registration Rights Agreement, we have filed the registration statement, of which this prospectus forms a part, with the SEC to register under the Securities Act the resale by the Selling Stockholder of up to 10,100,000 shares of Class A Common Stock, including (i) up to 10,000,000 shares of Class A Common Stock that we may elect, in our sole discretion, to issue and sell to the Selling Stockholder from time to time from and after the Commencement Date (as defined below) under the Purchase Agreement, (ii) 25,000 shares of Class A Common Stock that we issued to the Selling Stockholder as consideration for its commitment to purchase shares of Class A Common Stock at our election under the Purchase Agreement (the Initial Commitment Shares ) and (iii) an aggregate of 75,000 shares of Class A Common Stock that we may issue to the Selling Stockholder as consideration for its commitment to purchase shares of Class A Common Stock at our election under the Purchase Agreement, if certain conditions are met, as described below (the Additional Commitment Shares and, together with the Initial Commitment Shares, the Commitment Shares ). Upon the initial satisfaction of the conditions to the Selling Stockholder s purchase obligations set forth in the Purchase Agreement (the Commencement ), including that the registration statement, of which this prospectus forms a part, be declared effective by the SEC, we will have the right, but not the obligation, from time to time at our sole discretion over the 36-month period beginning on the date the Commencement occurs (the Commencement Date ), to direct the Selling Stockholder to purchase a specified number of shares of Class A Common Stock (each, a VWAP Purchase ), not to exceed the lesser of (i) 1,000,000 shares of our Class A Common Stock (ii) 20.0% of the total aggregate number (or volume) of shares of our Class A Common Stock traded on NYSE American during the applicable Purchase Valuation Period (as defined below) for such purchase (such lesser amount of shares, the Maximum Purchase Amount ) (such specified number of shares to be purchased by the Selling Stockholder in such VWAP Purchase, adjusted to the extent necessary to give effect to the applicable Purchase Amount and certain additional limitations set forth in the Purchase Agreement the Purchase Share Amount ) by timely delivering written notice to the Selling Stockholder (each, a Purchase Notice ) prior to 9:00 a.m., New York City time, on any trading day (each, a Purchase Date ), so long as (i) the closing sale price of our Class A Common Stock on NYSE American on the trading day immediately prior to such Purchase Date is not less than $1.00, subject to adjustment as set forth in the Purchase Agreement (such price, as may be adjusted from time to time in accordance with the Purchase Agreement, the Threshold Price ) and (ii) all shares of Class A Common Stock subject to all prior purchases effected by us under the Purchase Agreement have been received by the Selling Stockholder prior to the time we deliver such Purchase Notice to the Selling Stockholder. The per share purchase price that the Selling Stockholder is required to pay for shares of Class A Common Stock in a VWAP Purchase effected by us pursuant to the Purchase Agreement, if any, will be determined by reference to the volume weighted average price of the Class A Common Stock (the VWAP ), calculated in accordance with the Purchase Agreement, for the period (the Purchase Valuation Period ) beginning at the official open (or commencement ) of the regular trading session on NYSE American on the applicable Purchase Date for such VWAP Purchase, and ending at the earliest to occur of (i) the official close of the regular trading session on NYSE American on such Purchase Date, (ii) such time that the total aggregate number (or volume) of shares of Class A Common Stock traded on NYSE American during such Purchase Valuation Period (calculated in accordance with the Purchase Agreement) reaches the applicable share volume maximum amount for such VWAP Purchase (the Purchase Volume Maximum ), calculated by dividing (a) the applicable Purchase Share Amount for such VWAP Purchase by (b) 0.20; less a fixed 3.0% discount to the VWAP for such Purchase Valuation Period; provided, that (A) the opening or first purchase of Class A Common Stock at or following the official open of such primary (or regular ) trading session that is reported in the consolidated system on the Purchase Date, (B) the last or closing sale of Class A Common Stock at or prior to the official close of such primary (or regular ) trading session that is reported in the consolidated system on the Purchase Date (as applicable), and (C) all shares of Class A Common Stock during such Purchase Valuation Period sold at a price below the per share minimum sale price threshold set forth in the Purchase Notice, or if we do not specify a minimum price threshold for such VWAP Purchase in such Purchase Notice, a price equal to 75.0% of the closing sale price of the Class A Common Stock on the trading day immediately prior to the applicable Purchase Date for such VWAP Purchase) (the Minimum Price Threshold ), shall be excluded from the calculation of the total number (or volume) of shares of Class A Common Stock traded on the NYSE American during such VWAP Purchase Period. Sky Harbour Group Corporation (Exact name of registrant as specified in its charter) Table of Contents In addition to the regular VWAP Purchases described above, after the Commencement we will also have the right, but not the obligation, subject to the continued satisfaction of conditions set forth in the Purchase Agreement, to direct the Selling Stockholder to purchase, on any trading day, including the same Purchase Date on which a regular VWAP Purchase is effected (if any, although we are not required to effect an earlier regular VWAP Purchase on such trading day), a specified number of shares of our Class A Common Stock (each, an Intraday VWAP Purchase ), not to exceed the lesser of (such lesser number of shares, the Intraday VWAP Purchase Maximum Amount ): (i) 1,000,000 shares of our Class A Common Stock and (ii) 20.0% of the total aggregate volume of shares of our Class A Common Stock traded on NYSE American during the applicable Intraday Purchase Valuation Period (determined in the same manner as for a regular VWAP Purchase) for such Intraday VWAP Purchase (such specified number of shares, adjusted to the extent necessary to give effect to the applicable Intraday Maximum Purchase Amount, the Intraday Purchase Share Amount ), by the delivery to the Selling Stockholder of an irrevocable written purchase notice, after 10:00 a.m., New York City time (and after the Purchase Valuation Period for any prior regular VWAP Purchase (if any) and the Intraday Purchase Valuation Period for the most recent prior Intraday VWAP Purchase effected on the same Purchase Date (if any) have ended), and prior to 3:30 p.m., New York City time, on such Purchase Date (each, an Intraday Purchase Notice ), so long as (i) the closing sale price of our Class A Common Stock on the trading day immediately prior to such Purchase Date is not less than the Threshold Price and (ii) all shares of Class A Common Stock subject to all prior VWAP Purchases and all prior Intraday VWAP Purchases by the Selling Stockholder under the Purchase Agreement have been received by the Selling Stockholder prior to the time we deliver such Intraday Purchase Notice to the Selling Stockholder. The per share purchase price for the shares of Class A Common Stock that we elect to sell to the Selling Stockholder in an Intraday VWAP Purchase pursuant to the Purchase Agreement, if any, will be calculated in the same manner as in the case of a regular VWAP Purchase (including the same fixed percentage discounts to the applicable VWAP as in the case of a regular VWAP Purchase, as described above), provided that the VWAP for each Intraday VWAP Purchase effected on a Purchase Date will be calculated over different periods during the regular trading session on NYSE American on such Purchase Date, each of which will commence and end at different times on such Purchase Date. There is no upper limit on the price per share that the Selling Stockholder could be obligated to pay for the Class A Common Stock we may elect to sell to it in any VWAP Purchase or any Intraday VWAP Purchase under the Purchase Agreement. In the case of VWAP Purchases and Intraday VWAP Purchases effected by us under the Purchase Agreement, if any, all share and dollar amounts used in determining the purchase price per share of Class A Common Stock to be purchased by the Selling Stockholder in a VWAP Purchase or an Intraday VWAP Purchase (as applicable), or in determining the applicable maximum purchase share amounts or applicable volume or price threshold amounts in connection with any such VWAP Purchase or Intraday VWAP Purchase (as applicable), in each case, will be equitably adjusted for any reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or other similar transaction occurring during any period used to calculate such per share purchase price, maximum purchase share amounts or applicable volume or price threshold amounts. From and after Commencement, we will control the timing and amount of any sales of Class A Common Stock to the Selling Stockholder. Actual sales of shares of Class A Common Stock to the Selling Stockholder under the Purchase Agreement will depend on a variety of factors to be determined by us from time to time, including, among other things, market conditions, the trading price of the Class A Common Stock and determinations by us as to the appropriate sources of funding for our business and its operations. Under the applicable NYSE American rules, in no event may we issue to the Selling Stockholder under the Purchase Agreement more than 11,420,253 shares of Class A Common Stock, which number of shares is equal to 19.99% of the shares of our Class A Common Stock outstanding immediately prior to the execution of the Purchase Agreement (the Exchange Cap ), unless (i) we obtain stockholder approval to issue shares of Class A Common Stock in excess of the Exchange Cap in accordance with applicable NYSE American rules, or (ii) the average price per share paid by the Selling Stockholder for all of the shares of Class A Common Stock that we direct the Selling Stockholder to purchase from us pursuant to the Purchase Agreement, if any, equals or exceeds the greater of (i) the book value per share of our Class A Common Stock or the (ii) sum of (A) $0.05 and (B) the official closing price of our Class A Common Stock on NYSE American on the trading day immediately preceding the date of the applicable VWAP Purchase Notice or Intraday VWAP Purchase Notice. Moreover, we may not issue or sell any shares of Class A Common Stock to the Selling Stockholder under the Purchase Agreement which, when aggregated with all other shares of Class A Common Stock then beneficially owned by the Selling Stockholder and its affiliates (as calculated pursuant to Section 13(d) of the Securities Exchange Act of 1934, as amended (the Exchange Act ), and Rule 13d-3 thereunder), would result in the Selling Stockholder beneficially owning more than 4.99% of the outstanding shares of Class A Common Stock (the Beneficial Ownership Limitation ). Delaware 6500 85-2732947 (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (IRS Employer Identification Number) 136 Tower Road, Suite 205 Westchester County Airport White Plains, NY 10604 Tel: (212) 554-5990 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Table of Contents The net proceeds to us from sales we elect to make to the Selling Stockholder under the Purchase Agreement, if any, will depend on the frequency and prices at which we sell shares of our Class A Common Stock to the Selling Stockholder. We expect that any proceeds received by us from such sales to the Selling Stockholder will be used for working capital, site acquisition and marketing expenses to fund the growth of our business, capital expenditures, and general corporate purposes. There are no restrictions on future financings, rights of first refusal, participation rights, penalties or liquidated damages in the Purchase Agreement or Registration Rights Agreement, other than a prohibition (with certain exceptions) on entering into specified Variable Rate Transactions (as such term is defined in the Purchase Agreement) during the term of the Purchase Agreement. Such transactions include, among others, the issuance of convertible securities with a conversion or exercise price that is based upon or varies with the trading price of our Class A Common Stock after the date of issuance, or our effecting or entering into an agreement to effect an equity line of credit or other substantially similar continuous offering with a third party, in which we may offer, issue or sell Class A Common Stock or any securities exercisable, exchangeable or convertible into Class A Common Stock at a future-determined price. The Selling Stockholder has agreed that none of the Selling Stockholder, its sole member, or any entity managed or controlled by the Selling Stockholder or its sole member, or any of their respective officers, will engage in or effect, directly or indirectly, for its own account or for the account of any other of such persons or entities, any short sales of the Class A Common Stock or hedging transaction that establishes a net short position in the Class A Common Stock during the term of the Purchase Agreement. The Purchase Agreement will automatically terminate on the earliest to occur of (i) the first day of the month next following the 36-month anniversary of the Commencement Date, (ii) the date on which the Selling Stockholder shall have purchased from us under the Purchase Agreement 10,000,000 shares of Class A Common Stock, (iii) the date on which the Class A Common Stock shall have failed to be listed or quoted on NYSE American or another U.S. national securities exchange identified as an eligible market in the Purchase Agreement, (iv) the 30th trading day after the date on which a voluntary or involuntary bankruptcy proceeding involving us has been commenced that is not discharged or dismissed prior to such trading day, and (v) the date on which a bankruptcy custodian is appointed for all or substantially all of our property or we make a general assignment for the benefit of creditors. We have the right to terminate the Purchase Agreement at any time after Commencement, at no cost or penalty, upon ten trading days prior written notice to the Selling Stockholder. The Selling Stockholder has the right to terminate the Purchase Agreement upon ten trading days prior written notice to us upon the occurrence of certain events set forth in the Purchase Agreement. We and the Selling Stockholder may also agree to terminate the Purchase Agreement by mutual written consent. In any case, no termination of the Purchase Agreement will be effective during the pendency of any VWAP Purchase that has not then fully settled in accordance with the Purchase Agreement. Neither we nor the Selling Stockholder may assign or transfer our respective rights and obligations under the Purchase Agreement or the Registration Rights Agreement, and no provision of the Purchase Agreement or the Registration Rights Agreement may be modified or waived by us or the Selling Stockholder. As consideration for its irrevocable commitment to purchase our Class A Common Stock under the Purchase Agreement, we issued to the Selling Stockholder 25,000 shares of our Class A Common Stock as Initial Commitment Shares upon execution of the Purchase Agreement and the Registration Rights Agreement. In addition, (i) on the first trading day following the Purchase Date for the first VWAP Purchase or Intraday VWAP Purchase that is completed in full by the Selling Stockholder, we will issue 25,000 additional shares of our Class A Common Stock to the Selling Stockholder as Additional Commitment Shares, (ii) upon our receipt of total aggregate gross cash proceeds equal to $5,000,000 from the Selling Stockholder under the Purchase Agreement (if any), we will issue 25,000 additional shares of our Class A Common Stock to the Selling Stockholder as Additional Commitment Shares, and (iii) upon our receipt of total aggregate gross cash proceeds equal to $25,000,000 (inclusive of the $5,000,000 included in (i)) from the Selling Stockholder under the Purchase Agreement (if any), we will issue 25,000 additional shares of our Class A Common Stock to the Selling Stockholder as Additional Commitment Shares, totaling 100,000 Commitment Shares (including the 25,000 Initial Commitment Shares we issued to the Selling Stockholder upon execution of the Purchase Agreement). Prior to the date of the Purchase Agreement, we paid the Selling Stockholder $25,000 as reimbursement for the Selling Stockholder s reasonable legal fees and disbursements incurred in connection with the preparation, negotiation, execution and delivery of the transaction documents and legal due diligence. Tal Keinan Chief Executive Officer Sky Harbour Group Corporation 136 Tower Road, Suite 205 Westchester County Airport White Plains, NY 10604 Tel: (212) 554-5990 (Name, address, including zip code, and telephone number, including area code, of agent for service) Table of Contents We do not know what the purchase price for our Class A Common Stock will be and therefore cannot be certain as to the number of shares we might issue to the Selling Stockholder under the Purchase Agreement after the Commencement Date. As of September 9, 2022, there were 14,962,831 shares of our Class A Common Stock outstanding, of which 1,563,107 shares were held by non-affiliates of the Company. We are registering for resale 10,100,000 shares of our Class A Common Stock by the Selling Stockholder under this prospectus, representing (i) the 25,000 Initial Commitment Shares that we issued to the Selling Stockholder on August 18, 2022 under the Purchase Agreement, (ii) up to 75,000 Additional Commitment Shares that may be issued to the Selling Stockholder under the Purchase Agreement if certain conditions are met and (iii) 10,000,000 shares of Class A Common Stock that may be issued to the Selling Stockholder from and after the Commencement Date, if and when we elect to sell shares to the Selling Stockholder under the Purchase Agreement. If all of the 10,100,000 shares of Class A Common Stock offered by the Selling Stockholder for resale under this prospectus were issued and outstanding as of the date hereof, such shares would represent approximately 40.3% of the total number of shares of our Class A Common Stock outstanding and approximately 86.8% of the total number of outstanding shares of Class A Common Stock held by non-affiliates as of September 9, 2022. The number of shares of our Class A Common Stock ultimately offered for resale by the Selling Stockholder through this prospectus is dependent upon the number of shares or our Class A Common Stock we elect to sell to the Selling Stockholder under the Purchase Agreement from and after the Commencement Date. There are substantial risks to our stockholders as a result of the issuance and sale of Class A Common Stock to the Selling Stockholder under the Purchase Agreement. These risks include substantial dilution, significant declines in our stock price and our inability to draw sufficient funds when needed. See Risk Factors. Issuances of our Class A Common Stock in this offering will not affect the rights or privileges of our existing stockholders, except that the economic and voting interests of each of our existing stockholders will be diluted as a result of any such issuance. Although the number of shares of Class A Common Stock that our existing stockholders own will not decrease, the shares owned by our existing stockholders will represent a smaller percentage of our total outstanding shares after any such issuance to the Selling Stockholder.
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diff --git a/parsed_sections/prospectus_summary/2022/SKYX_skyx_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/SKYX_skyx_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/SMR_nuscale_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/SMR_nuscale_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..b15cd788ce0398d7f852f3e8e2b9847edec8c30d
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@@ -0,0 +1 @@
+This summary highlights selected information included in this prospectus and does not contain all of the information that may be important to you. To understand this offering fully, you should read this entire prospectus, the registration statement of which this prospectus is a part and the documents incorporated by reference herein carefully, including the information set forth under the heading Risk Factors and our financial statements. NuScale Corp NuScale Power Corporation is an advanced nuclear technology company that is developing an SMR to generate steam that can be used for electrical generation, district heating, desalination, hydrogen production and other process heat applications. For more information regarding NuScale Corp, see the sections entitled Business and Management s Discussion and Analysis of Financial Condition and Results of Operations. Background NuScale Power Corporation (formerly named Spring Valley Acquisition Corp. ) was a blank check company incorporated under the laws of the Cayman Islands. Spring Valley, Merger Sub and NuScale LLC entered into Merger Agreement on December 13, 2021, as amended, and the following transactions contemplated by the Merger Agreement were completed on May 2, 2022: Spring Valley changed its jurisdiction of incorporation by deregistering as an exempted company in the Cayman Islands, domesticated as a corporation under the laws of the State of Delaware, and changed its name to NuScale Power Corporation ; NuScale Corp was designated as the sole manager of NuScale LLC; Merger Sub merged into NuScale LLC with NuScale LLC surviving; and the combined company was organized in an UP-C structure, in which substantially all of the assets and business of the combined company are held by NuScale LLC. As a result of these transactions, former public shareholders of Spring Valley own shares of Class A Common Stock of NuScale Corp; NuScale Corp and the Legacy NuScale Equityholders hold NuScale LLC Class A Units and NuScale LLC Class B Units, respectively; and Legacy NuScale Equityholders hold a number of shares of Class B Common Stock (which represent a right to cast one vote per share at the NuScale Corp level, and carry no economic rights) equal to the number of NuScale LLC Class B Units held by the Legacy NuScale Equityholders. TABLE OF CONTENTS The information in this preliminary prospectus is not complete and may be changed. These securities may not be issued until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and does not constitute the solicitation of an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED June 13, 2022 PRELIMINARY PROSPECTUS 228,011,646 Shares of Class A Common Stock 8,900,000 Warrants to Purchase Shares of Class A Common Stock NUSCALE POWER CORPORATION This prospectus relates to (1) the issuance by us of up to 178,396,711 shares ( Exchange Shares ) of Class A Common Stock, par value $0.0001 per share ( Class A Common Stock ), of NuScale Power Corporation, a Delaware corporation ( NuScale Corp, we, our or us ), upon exchange (on a one-for-one basis, subject to adjustment) of Class B Units of NuScale Power, LLC, an Oregon limited liability company ( NuScale LLC ) (which Class B Units were originally purchased at various times since 2007 for ascribed prices per unit ranging from approximately $0.00 (for certain incentive awards) to $7.76 per unit, and which collectively have a weighted average ascribed purchase price of $4.74 per unit) and cancellation of a corresponding number of shares of Class B Common Stock, par value $0.0001 per share, of NuScale Corp, and the resale of 171,755,372 Exchange Shares, the resale of which might otherwise be limited by the resale restrictions imposed on control securities under Rule 144 under the Securities Act; (2) the issuance by us of up to 11,500,000 shares of Class A Common Stock upon the exercise of the NuScale Corp Public Warrants (as defined below); (3) the issuance by us of up to 8,900,000 shares of Class A Common Stock upon the exercise of NuScale Corp Private Placement Warrants (defined below) and the resale of such shares; and (4) the resale from time to time by the selling securityholders named in this prospectus or their permitted transferees of up to: 8,900,000 NuScale Corp Private Placement Warrants (as defined below) to purchase Class A Common Stock, which NuScale Corp Private Placement Warrants were originally purchased for $1.00 per warrant; 23,700,002 shares of Class A Common Stock, which were originally purchased for approximately $10.00 per share by PIPE Investors (defined below) immediately prior to the consummation of the Merger (defined below) pursuant to the terms of the Subscription Agreements (defined below); and 5,514,933 shares of Class A Common Stock held by Spring Valley Acquisition Sponsor Sub, LLC and its affiliates and the former officers and directors of Spring Valley Acquisition Corp ( Spring Valley Founders ), which were originally purchased for approximately $0.003 per share and 1,643,924 of which are subject to potential forfeiture. On May 2, 2022 (the Closing Date ), Spring Valley Acquisition Corp., formerly a blank check company incorporated as a Cayman Islands exempted company ( Spring Valley ), completed the previously announced transactions pursuant to the Agreement and Plan of Merger dated December 13, 2021 (as amended) between Spring Valley, Spring Valley Merger Sub, LLC, an Oregon limited liability company ( Merger Sub ) and NuScale LLC, including: (a) the domestication of Spring Valley as a Delaware corporation (the Domestication ) and the change of its name to NuScale Power Corporation ; and (b) the merger ( Merger ) of Merger Sub with and into NuScale LLC, with NuScale LLC as the surviving business entity in the Merger, through which the combined company was reorganized in an UP-C structure, with NuScale Corp now serving as the sole manager of NuScale LLC. NuScale LLC is now owned in part, indirectly through NuScale Corp, by former public and private shareholders of Spring Valley and in part directly by continuing equity owners of NuScale LLC (the Legacy NuScale Equityholders ). After the Domestication and immediately before completion of the Merger, Spring Valley issued to certain selling securityholders, in private placements, 23,700,002 shares of Class A Common Stock at approximately $10.00 per share, for an aggregate purchase price of $235,000,000. In connection with the special meeting at which shareholders approved the Merger, holders of 8,599,631 shares of our Class A Common Stock, or 37.5% of the shares with redemption rights, exercised their right to redeem their shares for cash at a redemption price of approximately $10.10 per share, for an aggregate redemption amount of $86.9 million. The shares of common stock being offered for resale pursuant to this prospectus by the selling securityholders represent approximately 85.5% of shares outstanding on a fully diluted basis as of June 9, 2022, assuming the exercise of all outstanding options to purchase Class A Common Stock. The sale of shares by the selling securityholders, or the perception in the market that the selling securityholders intend to sell a large number of shares, could increase the volatility of the market price of our Class A Common Stock or result in a significant decline in the public trading price of our Class A Common Stock. Even if our trading price is significantly below $10.00, the offering price for the units offered in our initial public offering, certain of the selling securityholders, including the Spring Valley Founders and the Legacy NuScale Equityholders, may still have an incentive to sell shares of our Class A Common Stock because they purchased the shares at prices lower than the price paid by the Public Shareholders (defined below) or the current trading price of our Class A Common Stock. For example, based on the closing price of our Class A Common Stock of $9.96 as of June 9, 2022, the Spring Valley Founders could experience a potential profit of up to approximately $9.96 per share, or $54.9 million in the aggregate. The selling securityholders may offer, sell or distribute all or a portion of the NuScale Corp Private Placement Warrants and the shares of Class A Common Stock registered hereby publicly or through private transactions at prevailing market prices or at negotiated prices. We provide more information about how the selling securityholders may sell their shares in the section entitled Plan of Distribution. We will pay certain offering fees and expenses and fees in connection with the registration of the NuScale Corp Private Placement Warrants and the Class A Common Stock and will not receive proceeds from the exchange of NuScale LLC Class B Units (and cancellation of a corresponding number of shares of Class B Common Stock) for Class A Common Stock or from the sale of the NuScale Corp Private Placement Warrants or shares of Class A Common Stock by the selling securityholders, except with respect to any amounts received by us upon exercise of any NuScale Corp Warrants. We believe the likelihood that warrant holders will exercise their warrants, and therefore the amount of cash proceeds that we would receive from such exercises, depends on the trading price of our Class A Common Stock, which may not exceed the $11.50 warrant exercise price before the warrants expire. In certain circumstances, the NuScale Corp Warrants can be exercised on a cashless basis. See Description of Capital Stock Warrants. The selling securityholders will bear all commissions and discounts, if any, attributable to their respective sales of the NuScale Private Placement Warrants or the Class A Common Stock. Our Class A Common Stock is listed on the New York Stock Exchange ( NYSE ) and trades under the symbol SMR. On June 9, 2022, the closing sale price of our Class A Common Stock was $9.96 per share. Our public warrants are listed on the NYSE and trade under the symbol SMR WS. June 9, 2022, the closing sale price of our public warrants was $2.57 per warrant. We are an emerging growth company as defined under applicable federal securities laws, and therefore are subject to certain reduced public company reporting requirements. INVESTING IN OUR SECURITIES INVOLVES RISKS THAT ARE DESCRIBED IN THE RISK FACTORS SECTION BEGINNING ON PAGE 9 OF THIS PROSPECTUS. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued under this prospectus or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2022. TABLE OF CONTENTS ABOUT THIS PROSPECTUS This prospectus is part of a registration statement on Form S-1 that we filed with the Securities and Exchange Commission (the SEC ) using the shelf registration process. Under this shelf registration process, the selling securityholders may, from time to time, sell the securities offered by them described in this prospectus. We will not receive any proceeds from the sale by selling securityholders of the securities offered by them. Neither we nor the selling securityholders (1) have authorized anyone to provide you with any information or to make any representations other than those contained in this prospectus or any applicable prospectus supplement or any free writing prospectuses prepared by or on behalf of us or to which we have referred you; (2) take responsibility for, or provide assurances as to the reliability of, any other information that others may give you; and (3) will make an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus, any applicable prospectus supplement or any related free writing prospectus. This prospectus is not an offer to sell securities, and it is not soliciting an offer to buy securities, in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus or any prospectus supplement is accurate only as of the date on the front of those documents, regardless of the time of delivery of this prospectus or any applicable prospectus supplement, or any sale of a security. Our business, financial condition, results of operations and prospects may have changed since those dates. For investors outside the United States: neither we nor the selling securityholders have done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of our securities and the distribution of this prospectus outside the United States. We may provide a prospectus supplement or post-effective amendment to the registration statement to add information to, or update or change information contained in, this prospectus. Any statement contained in this prospectus will be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained in such prospectus supplement modifies or supersedes such statement. Any statement so modified will be deemed to constitute a part of this prospectus only as so modified, and any statement so superseded will be deemed not to constitute a part of this prospectus. You should read both this prospectus and any supplement or post-effective amendment with the additional information to which we refer you in the section of this prospectus entitled Where You Can Find More Information. You should rely only on the information contained in this prospectus, any applicable prospectus supplement or any related free writing prospectus. BASIS OF PRESENTATION We were incorporated on August 20, 2020 as a Cayman Islands exempted company under the name Spring Valley Acquisition Corp. for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. On May 2, 2022, we completed the Transactions (as defined herein), following which we were renamed NuScale Power Corporation, and we act as the sole manager of NuScale Power, LLC, an Oregon limited liability company ( NuScale LLC ). Unless otherwise indicated, the financial information included herein is that of NuScale LLC, which, following the Transactions, became our business. We are a holding company and, accordingly, all of our assets are held directly by, and all of our operations are conducted through, NuScale LLC, and our only direct asset consists of NuScale LLC Class A Units. As the manager of NuScale LLC, we have the full, exclusive, and complete discretion to manage and control the business of NuScale LLC and to take all action we deem necessary, appropriate, advisable, incidental, or convenient to accomplish the purposes of NuScale LLC set forth in its operating agreement. We may not be removed as the manager of NuScale LLC. Because we had limited operations before the Transactions, NuScale LLC is our predecessor for financial reporting purposes and we present in this prospectus pro forma condensed consolidated financial statements that give effect to the Merger in the historical periods presented. The financial statements of NuScale LLC for periods following the Transactions will be prepared on a consolidated basis with ours. TABLE OF CONTENTS The following diagram illustrates in simplified terms the structure of NuScale Corp and NuScale LLC. In connection with entering into the Merger Agreement, Spring Valley entered into the Subscription Agreements with certain PIPE Investors, pursuant to which, among other things, the PIPE Investors party thereto agreed to purchase an aggregate of 21,300,002 shares of Class A Common Stock immediately prior to the Closing at an aggregate purchase price of $211,000,000. On March 29, 2022, Spring Valley entered into a Subscription Agreement with another PIPE Investor, pursuant to which, among other things, the PIPE Investor party thereto agreed to purchase 1,000,000 shares of Class A Common Stock immediately prior to the Closing for a purchase price of $10,000,000. In addition, on April 4, 2022, Spring Valley entered into a Subscription Agreement with another PIPE Investor, pursuant to which, among other things, the PIPE Investor party thereto agreed to purchase 1,500,000 shares of Class A Common Stock immediately prior to Closing for a purchase price of $15,000,000. On April 26, 2022, Spring Valley entered into an Amendment to Subscription Agreement with one of the PIPE Investors to change its subscription from 200,000 shares of Class A Common Stock for a purchase price of $2,000,000 to 100,000 shares of Class A Common Stock for a purchase price of $1,000,000. Selling Securityholders This registration statement registers for resale 8,900,000 NuScale Corp Private Placement Warrants to purchase Class A Common Stock, which NuScale Corp Private Placement Warrants were originally purchased for $1.00 per warrant, and up to an aggregate of 209,870,307 shares of Class A Common Stock composed of: (a) 171,755,372 shares of Class A Common Stock issuable upon exchange (on a one-for-one basis, subject to adjustment) of Class B Units of NuScale LLC, which Class B Units were originally purchased at various times since 2007 for ascribed prices per unit ranging from approximately $0.00 (for certain incentive awards) to $7.76 per unit, and which collectively have a weighted average ascribed purchase price of $4.74 per unit; (b) 23,700,002 shares of Class A Common Stock, which were originally purchased for approximately $10.00 per share issued in private placements by PIPE Investors; and (c) 5,514,933 shares of Class A Common Stock held by Spring Valley Founders, which were originally purchased for approximately $0.003 per share and 1,643,924 of which are subject to potential forfeiture. TABLE OF CONTENTS Certain monetary amounts, percentages and other figures included in this prospectus have been subject to rounding adjustments. Accordingly, figures shown as totals in certain tables and charts may not be the arithmetic aggregation of the figures that precede them, and figures expressed as percentages in the text may not total 100% or, as applicable, when aggregated may not be the arithmetic aggregation of the percentages that precede them. Unless the context otherwise requires, references in this prospectus to the Company, NuScale, we, us, or our refer to the business of NuScale LLC, which became the business of NuScale Power Corporation following the consummation of the Transactions. MARKET AND INDUSTRY DATA This prospectus includes, and any amendment or supplement to this prospectus may include, estimates regarding market and industry data and forecasts, which are based on our own estimates utilizing our management s knowledge of and experience in, as well as information obtained from trade and business organizations, and other contacts in the market sectors in which we compete, and from statistical information obtained from publicly available information, industry publications and surveys, reports from government agencies, and reports by market research firms. We confirm that, where such information is reproduced herein, such information has been accurately reproduced and that, so far as we are aware and are able to ascertain from information published by publicly available sources and other publications, no facts have been omitted that would render the reproduced information inaccurate or misleading. Industry publications, reports, and other published data generally state that the information contained therein has been obtained from sources believed to be reliable, but we cannot assure you that the information contained in these reports, and therefore the information contained in this prospectus or any amendment or supplement to this prospectus that is derived therefrom, is accurate or complete. Our estimates of our market position may prove to be inaccurate because of the method by which we obtain some of the data for our estimates or because this information cannot always be verified with complete certainty due to the limits on the availability and reliability of raw data, the voluntary nature of the data gathering process, and other limitations and uncertainties. As a result, although we believe our sources are reliable, we have not independently verified the information and cannot guarantee its accuracy and completeness. TRADEMARKS NuScale Power Corporation, NuScale Power, LLC, and their logos, and other registered and common law trade names, trademarks and service marks, including NuScale Power Module , VOYGR and Triple Crown For Nuclear Plant Safety , are the property of NuScale Power, LLC. Solely for convenience, trademarks and trade names referred to in this prospectus may appear without the or symbols, but such references are not intended to indicate, in any way, that the applicable licensor will not assert, to the fullest extent under applicable law, its rights to these trademarks and trade names. This document contains references to trademarks and service marks belonging to other entities. We do not intend our use or display of other companies trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies. TABLE OF CONTENTS Even if our trading price is significantly below $10.00, the offering price for the units offered in the Company s initial public offering, certain of the selling securityholders, including the Spring Valley Founders, may still have an incentive to sell shares of our Class A Common Stock because they purchased the shares at prices lower than the Public Shareholders or the current trading price of our Class A Common Stock. For example, based on the closing price of our Class A Common Stock of $9.96 as of June 9, 2022, the Spring Valley Founders could experience a potential profit of approximately $9.96 per share, or $54.9 million in the aggregate; the PIPE Investors would realize a potential loss of approximately $0.04 per share, or $0.9 million in the aggregate; and the Legacy NuScale Equityholders would realize a potential profit (on average) of approximately $5.22 per share, or $931.1 million in the aggregate. Similarly, if the Spring Valley Founders sold NuScale Corp Private Placement Warrants for $2.57 per warrant, the closing price of our warrants on June 9, 2022, the Spring Valley Founders would realize a potential profit of approximately $1.57 per warrant, or $14.0 million in the aggregate. Purchasers of Class A Common Stock or NuScale Corp Private Placement Warrants in the offering made by this prospectus may not experience a similar rate of return. See Risk Factors Risks Related to this Offering and Ownership of Our Shares of Class A Common Stock or NuScale Corp Warrants You may not experience a rate of return on your investment in Class A Common Stock similar to the return experienced by existing stockholders, including those who hold shares that are registered for resale under this registration statement. Summary of Risk Factors (page 9) The investment in our securities involve significant risks, and you should carefully read and consider the factors discussed under Risk Factors. The following is a summary of some of these risks. If any of the following events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. Risks Related to Our Structure and Governance We are subject to risks related to our dependency on NuScale LLC to pay taxes, make payments under the Tax Receivable Agreement and pay dividends; If NuScale LLC were treated as a corporation for United States federal income tax or state tax purposes, then the amount available for distribution by NuScale LLC could be substantially reduced and the value of NuScale Corp shares could be adversely affected; In certain cases, payments under the Tax Receivable Agreement may be accelerated and/or significantly exceed the actual tax benefits NuScale Corp realizes; NuScale Corp is a controlled company under the NYSE listing standards, and as a result, its stockholders may not have certain corporate protections that are available to stockholders of companies that are not controlled companies; and Spring Valley identified a material weakness in its internal control over financial reporting. This material weakness could continue to adversely affect NuScale Corp s ability to report its results of operations and financial condition accurately and in a timely manner. Risks Related to NuScale LLC s Business and Industry NuScale LLC has not yet delivered an NPM to a customer or entered into a binding contract with a customer to deliver NPMs, and there is no guarantee that it will be able to do so; Competitors in China and Russia currently operate commercial SMRs and may have advantages in marketing their SMRs to potential customers; NuScale LLC may be unable to charge Utah Associated Municipal Power Systems (UAMPS), its first customer, for some costs NuScale LLC has incurred and it may be required to reimburse UAMPS if NuScale LLC fails to achieve specified performance measures; Any delays in the development and manufacture of NPMs and related technology, the failure of any commercial or demonstration missions, or the failure to timely deliver NPMs to customers may adversely impact NuScale LLC s business and financial condition; TABLE OF CONTENTS SELECTED DEFINITIONS When used in this prospectus, unless the context otherwise requires: A&R NuScale LLC Agreement refers to the Sixth Amended and Restated Limited Liability Company Agreement of NuScale LLC. ASC refers to the Financial Accounting Standards Board Accounting Standards Codification. Board refers to the board of directors of NuScale Corp. Bylaws refers to the bylaws of NuScale Corp. Cayman Islands Companies Act refers to the Companies Act (As Revised) of the Cayman Islands, as the same may be amended from time to time. Charter refers to the certificate of incorporation of NuScale Corp. Class A Common Stock refers to shares of Class A common stock, par value $0.0001 per share, of NuScale Corp. Class B Common Stock refers to shares of Class B common stock, par value $0.0001 per share, of NuScale Corp., which represents the right to one vote per share and carries no economic rights. Common Stock refers collectively to shares of Class A Common Stock and Class B Common Stock. Closing refers to the closing of the Merger. Closing Acquiror Cash refers to, without duplication, an amount equal to (a) the funds contained in the Trust Account as of immediately prior to the Closing; plus (b) all other cash and cash equivalents of Spring Valley as of immediately prior to the Closing; minus (c) the aggregate amount of cash proceeds that were required to satisfy the redemption of any shares of Spring Valley Class A ordinary shares (to the extent not already paid); plus (d) the aggregate proceeds of the PIPE Investment that is actually paid to Spring Valley at or prior to the Closing; minus (e) any Transaction Expenses (as defined in the Merger Agreement) in excess of $43,000,000 in the aggregate. Closing Date refers to the date on which the Closing occurred. COVID-19 refers to the novel coronavirus pandemic. DGCL refers to the Delaware General Corporation Law, as amended. DOE refers to the U.S. Department of Energy. Domestication refers to the continuation of Spring Valley by a way of domestication of Spring Valley into a Delaware corporation, with the ordinary shares of Spring Valley becoming shares of common stock of the Delaware corporation under the applicable provisions of the Cayman Islands Companies Act and the DGCL; the term includes all matters and necessary or ancillary changes in order to effect such Domestication, including the adoption of the Proposed Charter (substantially in the form attached hereto at Annex C) consistent with the DGCL and changing the name and registered office of Spring Valley. Effective Time refers to the time when the Merger was consummated. Exchange Act refers to the Securities Exchange Act of 1934, as amended. Exchange Ratio refers to the Exchange Ratio as defined in the Merger Agreement. FASB refers to the Financial Accounting Standards Board. Fluor refers to Fluor Enterprises, Inc., a California corporation, which is wholly owned by Fluor Corporation (NYSE: FLR). Fluor Convertible Loan Agreement refers to that certain Amended and Restated Senior Secured Convertible Loan Agreement, dated as of September 30, 2011, between Fluor and NuScale LLC, as amended from time to time. TABLE OF CONTENTS NuScale LLC has incurred significant losses since inception, expects to incur losses in the future, and may not be able to achieve or maintain profitability; The cost of electricity generated from nuclear sources may not be cost competitive with other electricity generation sources in some markets, and NuScale LLC may fail to effectively incorporate updates to the design, construction, and operations of NuScale LLC plants to ensure cost competitiveness, which could materially and adversely affect NuScale LLC s business; The market for SMRs is not yet established and may not achieve the growth potential expected or may grow more slowly than expected; NuScale LLC s commercialization strategy relies heavily on its relationship with Fluor, and other strategic investors and partners, who may have interests that diverge from NuScale LLC and who may not be easily replaced if their relationships terminate; NuScale LLC may be unable to manage its future growth effectively, which could make it difficult to execute its business strategy; If manufacturing and construction issues are not identified prior to design finalization, long-lead procurement, and/or module fabrication, then those issues will be realized during production, fabrication, or construction and may impact plant deployment cost and schedule; NuScale LLC and its customers operate in a politically sensitive environment, and may be affected by the public perception of nuclear energy and accidents, terrorist attacks or other high-profile events involving nuclear materials; NuScale LLC s supply base may not be able to scale to the production levels necessary to meet sales projections, and a lack of availability and cost of component raw materials may affect the manufacturing processes for plant equipment and increase NuScale LLC s costs; NuScale LLC is highly dependent on its senior management team and other highly skilled personnel, and may not be able to successfully implement its business strategy if it is unable to attract highly qualified personnel; NuScale LLC may require additional future funding, which may be difficult or impossible to obtain on acceptable terms or at all and which may be negatively affected by the resale of shares of Class A Common Stock by selling securityholders pursuant to this prospectus which could result in a significant decline in the trading price of our Class A Common Stock; NuScale LLC may be unable to adequately protect its intellectual property rights, in particular its rights in non-U.S. jurisdictions, and may be subject to infringement claims from others; NuScale LLC s SDA (defined below) application for the 77 MWe power module has not yet been submitted to the NRC, and its approval is not guaranteed; NuScale LLC s design is only approved in the United States and it must obtain approvals on a country- by-country basis before it can sell its products abroad, which approvals may be delayed or denied or which may require modification to its design; NuScale LLC s customers must obtain additional, site-specific regulatory approvals before they can construct power plants using NPMs, which may be delayed or denied; and NuScale LLC s business is subject to a wide variety of extensive and evolving laws and regulations including export and import controls, nuclear material and nuclear power regulations, and environmental regulations and changes in and/or failure to comply with such laws and regulations could have a material adverse effect on its business. Risks Related to this Offering and Ownership of Our Shares of Class A Common Stock and NuScale Corp Warrants We are subject to risks related to the volatility of the price of our Class A Common Stock and NuScale Corp Warrants; TABLE OF CONTENTS Fluor Convertible Note refers to that certain amended and restated secured convertible promissory note issued by NuScale LLC on September 30, 2011 in the aggregate principal amount of $10,281,427.49 pursuant to the Fluor Convertible Loan Agreement. G&A refers to general and administrative expenses. IPO or Initial Public Offering refers to the initial public offering of Spring Valley, which closed on November 27, 2020. Legacy NuScale Equityholders refers to the holders of NuScale LLC Units other than NuScale Corp. Merger refers to the merger of Merger Sub with and into NuScale LLC, with NuScale LLC as the surviving entity. Merger Agreement refers to the Agreement and Plan of Merger, dated as of December 13, 2021 (as amended, modified, supplemented or waived from time to time), by and among Spring Valley, Merger Sub and NuScale LLC. Merger Sub refers to Spring Valley Merger Sub, LLC, an Oregon limited liability company and a wholly owned subsidiary of Spring Valley. MWe refers to one million watts of electric power. MWt refers to one million watts of thermal power. NPM refers to NuScale Power Module . NRC refers to the U.S. Nuclear Regulatory Commission. NuScale Corp refers to NuScale Power Corporation, a Delaware corporation and the combined company following the consummation of the Transactions, and its consolidated subsidiaries, including NuScale LLC. NuScale Corp Private Placement Warrants refers to the 8,900,000 warrants to purchase Spring Valley Class A ordinary shares that were issued in a private placement concurrently with the IPO and converted in the Transactions into warrants to purchase Class A common shares. NuScale Corp Public Warrants refers to the 11,500,000 redeemable warrants issued in the IPO and converted in the Transactions into warrants to purchase Class A common shares. NuScale Corp Warrants refers collectively to the NuScale Corp Public Warrants and the NuScale Corp Private Placement Warrants. NuScale LLC refers to NuScale Power, LLC, an Oregon limited liability company. NuScale LLC Class A Units refers to the Class A units of NuScale LLC issued to NuScale Corp immediately after the Closing. NuScale LLC Class B Units refers to non-voting, Class B units of NuScale LLC. NuScale LLC Common Units refers to the collective NuScale LLC limited liability company interests existing immediately after the Closing. NYSE means the New York Stock Exchange. Organizational Documents refers to the Charter and the Bylaws. PCAOB refers to the Public Company Accounting Oversight Board. PIPE Investment refers to the PIPE Investors purchase an aggregate of 23,700,002 shares of Class A Common Stock at an aggregate cash purchase price of $235,000,000 pursuant to the Subscription Agreements. PIPE Investors refers, collectively, to the institutional and accredited investors that made the PIPE Investment. Pre-Existing NuScale Common Units refers to the Common Units of NuScale LLC as defined in the Fifth Amended and Restated Limited Liability Company Agreement of NuScale LLC. TABLE OF CONTENTS The resale of shares registered by this registration statement, which represent a majority of the shares that are or will be outstanding, or of other shares that are freely tradeable could cause the market price of our Class A Common Stock to drop significantly; NuScale Corp Warrants are exercisable for Class A Common Stock, which, if exercised, would increase the number of shares eligible for future resale in the public market and result in dilution to our stockholders; and A market for shares of the Class A Common Stock may fail to develop. Emerging Growth Company Status Section 102(b)(1) of the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ) exempts emerging growth companies ( EGCs ) from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a registration statement under the Securities Act declared effective or do not have a class of securities registered under the Exchange Act) are required to comply with such standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-EGCs but any such election to opt out is irrevocable. We intend to take advantage of the benefits of this extended transition period. We will remain an EGC until the earlier of: (1) the last day of the fiscal year (a) 2025, (b) in which we have total annual gross revenue of at least $1.07 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common equity that is held by non-affiliates exceeds $700 million as of the end of the prior fiscal year s second fiscal quarter; and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. We expect to remain an EGC until December 31, 2025, the last day of the fiscal year following the fifth anniversary of the completion of our IPO on November 27, 2020. Corporate Information We were incorporated on August 20, 2020 as a Cayman Islands exempted company under the name Spring Valley Acquisition Corp. for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. On May 2, 2022, we completed the Transactions, following which we were renamed NuScale Power Corporation. Our principal executive offices are located at 6650 SW Redwood Lane, Suite 210, Portland, OR 97224, and our telephone number is (971) 371-1592. Our website is www.nuscalepower.com. The information found on, or that can be accessed from or that is hyperlinked to, our website is not part of this prospectus. TABLE OF CONTENTS Pre-Existing NuScale Options refers to options to purchase Pre-Existing NuScale Common Units, which Pre-Existing NuScale Options converted automatically in the Merger into options to purchase Class A Common Stock. Public Shareholder refers to a holder of Spring Valley Class A ordinary shares sold in the Initial Public Offering. R&D refers to research and development. Registration Rights Agreement refers to the registration rights agreement, dated May 2, 2022 between NuScale Corp., the Sponsor, the Sponsor Sub, the former independent directors of Spring Valley and certain equity holders of NuScale Corp and NuScale LLC. SEC refers to the United States Securities and Exchange Commission. Securities Act refers to the Securities Act of 1933, as amended. SMR means small modular reactor. Sponsor refers to Spring Valley Acquisition Sponsor, LLC, a Delaware limited liability company. Sponsor Letter Agreement refers to the sponsor letter agreement, dated as of December 13, 2021, by and among Sponsor Sub, Spring Valley and NuScale LLC. Sponsor Sub refers to SV Acquisition Sponsor Sub, LLC, a Delaware limited liability company. Spring Valley refers to Spring Valley Acquisition Corp., a special purpose acquisition company incorporated as a Cayman Islands exempt company. Spring Valley Founders refers to Sponsor Sub and its affiliates and the former officers and directors of Spring Valley Acquisition Corp, Spring Valley Letter Agreement refers to that certain Letter Agreement, dated November 23, 2020, by and between Spring Valley, the Sponsor and each of the officers and directors of Spring Valley. Subscription Agreements refers to the subscription agreements (as amended from time to time) that Spring Valley entered into with the PIPE Investors in connection with the Merger Agreement, each dated as of December 13, 2021, March 29, 2022, or April 4, 2022. Tax Receivable Agreement or TRA refers to that certain tax receivable agreement entered into concurrent with the Closing by and among NuScale Corp, NuScale LLC and the Legacy NuScale Equityholders. Transactions refers to the transactions contemplated by the Merger Agreement. Units refers to a unit which Spring Valley sold in the IPO consisting of one Spring Valley Class A ordinary share and one half of a Spring Valley Public Warrant. U.S. GAAP or GAAP refers to generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the United States, that are applicable to the circumstances as of the date of determination, consistently applied. VWAP refers to the dollar volume-weighted average price. TABLE OF CONTENTS
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+PROSPECTUS SUMMARY The following highlights certain information contained elsewhere in this prospectus. It does not contain all the details concerning this offering, including information that may be important to you. You should carefully review this entire prospectus including the section entitled "Risk Factors" and the consolidated historical and consolidated pro forma financial statements and accompanying notes contained herein. See "Where You Can Find More Information." Corporate History When the terms "the Company," "we," "us" or "our" are used in this document, those terms refer to SusGlobal Energy Corp., and its wholly-owned subsidiaries, SusGlobal Energy Canada Corp., SusGlobal Energy Canada I Ltd., SusGlobal Energy Belleville Ltd., SusGlobal Energy Hamilton Ltd., and 1684567 Ontario Inc. The following organization chart sets forth our wholly-owned subsidiaries: The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said section 8(a), may determine. SusGlobal Energy Corp. ("SusGlobal") was formed by articles of amalgamation on December 3, 2014, in the Province of Ontario, Canada and its executive office is in Toronto, Ontario, Canada. SusGlobal, a company in the start-up stages and Commandcredit Corp. ("Commandcredit"), an inactive Canadian public company, amalgamated to continue business under the name of SusGlobal Energy Corp. On May 23, 2017, SusGlobal filed an Application for Authorization to continue in another jurisdiction with the Ministry of Government Services in Ontario and a certificate of corporate domestication and certificate of incorporation with the Secretary of State of the State of Delaware under which it changed its jurisdiction of incorporation from Ontario to the State of Delaware (the "Domestication"). In connection with the Domestication each of the issued and outstanding shares were automatically converted on a one-for-one basis into shares compliant with the laws of the state of Delaware (the "Shares"). As a result of the Domestication, pursuant to Section 388 of the General Corporation Law of the State of Delaware (the "DGCL"), SusGlobal continued its existence under the DGCL as a corporation incorporated in the State of Delaware. The business, assets and liabilities of SusGlobal and its subsidiaries on a consolidated basis, as well as its principal location and fiscal year, were the same immediately after the Domestication as they were immediately prior to the Domestication. SusGlobal filed a Registration Statement on Form S-4 to register the Shares and this registration statement was declared effective by the SEC on May 12, 2017. On December 11, 2018, the Company began trading on the OTCQB, under the ticker symbol SNRG. Business As the global amount of organic waste continues to grow, a solution for sustainable global management of these wastes is paramount. SusGlobal through its proprietary technology and processes is equipped and confident to deliver this objective. Management believes renewable energy is the energy of the future. Sources of this type of energy are more evenly distributed over the earth's surface than finite energy sources, making it an attractive alternative to petroleum-based energy. Biomass, one of the renewable resources, is derived from organic material such as forestry, food, plant and animal residuals. SusGlobal can therefore help you turn what many consider waste into precious energy and regenerative products. The portfolio will be comprised of three distinct types of technologies: (a) Process Source Separated Organics ("SSO") in anaerobic digesters to divert from landfills and recover biogas. This biogas can be converted to gaseous fuel for industrial processes, electricity to the grid or cleaned for compressed renewable gas. (b) Maximizing the capacity of existing infrastructure (anaerobic digesters) to allow processing of SSO to increase biogas yield. (c) and (c) process SSO and digestate to produce an organic compost or a pathogen free organic liquid fertilizer. The convertibility of organic material into valuable end products such as biogas, liquid biofuels, organic fertilizers and compost shows the utility of renewables. These products can be converted into electricity, fuels and marketed to agricultural operations that are looking for an increase in crop yields, soil amendment and environmentally-sound practices. This practice also diverts these materials from landfills and reduces Greenhouse Gas Emissions ("GHG") that result from landfilling organic wastes. The Company can provide peace of mind that the full lifecycle of organic material is achieved, global benefits are realized and stewardship for total sustainability is upheld. It is management's objective to grow SusGlobal into a significant sustainable waste to energy and regenerative products provider, as Leaders in The Circular Economy . The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and we are not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED MAY 16, 2022 2,400,000 Units Each Unit Consisting of One Share of Common Stock and One Warrant to Purchase One Share of Common Stock 1,319,534 Shares of Common Stock SUSGLOBAL ENERGY CORP. We are offering 2,400,000 units (each a "Unit" and collectively, the "Units") of SusGlobal Energy Corp. (the "Company," "SusGlobal," "we," "our" or "us") with each Unit consisting of one share of common stock, par value $0.0001, which we refer to as the "Common Stock", and one warrant to purchase one share of Common Stock (the "Warrant"). The Units have no stand-alone rights and will not be certified or issued as stand-alone securities. The assumed public offering price is $5.00 per Unit. The Warrants included in the Units are exercisable immediately and have an exercise price of $6.00 per share (120% of the price per unit sold in this offering). We do not intend to list the Warrants for trading on any stock market or exchange and such warrants will expire five years from the date of issuance. This offering also includes the shares of Common Stock issuable from time to time upon exercise of the Warrants. The selling stockholders identified herein (the "Selling Stockholders") are offering 1,319,534 shares of Common Stock. The Common Stock offered by the Selling Stockholders includes: (i) 1,152,034 shares of Common Stock issuable upon the conversion of convertible notes held by three Selling Stockholders (at a conversion price of 65% of the public offering price for two holders and 70% of the public offering price for one holder); (ii) 167,500 consultancy shares of Common Stock held by two Selling Stockholders (these 167,500 shares were already issued to the Selling Stockholders and will not be adjusted for any reverse stock split). These 1,319,534 shares of common stock offered by the Selling Stockholders are defined herein as the "Selling Stockholder Shares." For a more detailed description of the convertible notes, see "Selling Stockholders." Our Common Stock is currently quoted on the OTCQB tier of the OTC Market Group, Inc. under the symbol "SNRG." The last reported sale price of our Common Stock on May 13, 2022 was $0.65 per share ($2.60 per share assuming a reverse stock split of 1-for-4). We have applied to list our Common Stock on The Nasdaq Capital Market ("Nasdaq Capital Market") under the symbol "SNRG". There is no assurance that our listing application will be approved by the Nasdaq Capital Market. The approval of our listing on the Nasdaq Capital Market is a condition of closing this offering. For purposes of this prospectus, the assumed public offering price per Unit is $5.00. The actual offering price per Unit will be as determined between Spartan Capital Securities, LLC and Revere Securities LLC, the representatives of the underwriters, and us at the time of pricing and may be issued at a discount to the current market price of our Common Stock. Factors to be considered will include our historical performance and capital structure, prevailing market conditions and overall assessment of our business. The market price of our Common Stock will be one of several factors to be considered in determining the actual offering price. Unless otherwise noted and other than in the financial statements and MD&A, the share and per share information in this prospectus reflects a reverse stock split of the outstanding Common Stock of the Company at a one for four (1:4) ratio, which was effected on [____], 2022. We believe the products and services offered can benefit both the public and private markets. The following includes some of our work managing organic waste streams: Anaerobic Digestion, Dry Digestion, Wastewater Treatment, In-Vessel Composting, SSO Treatment, Biosolids Heat Treatment, Leachate Management, Composting and Liquid Fertilizers. The Company can provide a full range of services for handling organic residuals in a period where innovation and sustainability are paramount. From start to finish we offer in-depth knowledge, a wealth of experience and cutting-edge technology for handling organic waste. The primary focus of the services SusGlobal provides includes integrating our technologies with capital investment to optimizing the processing of SSO. Our processes not only divert significant organic waste from landfills, but also result in methane avoidance, with significant GHG reductions from waste disposal. The processes produce regenerative products through the conversion of organic wastes into organic fertilizer, both dry compost and liquid. Currently, the primary customers are municipalities in both rural and urban centers in Ontario, Canada. Where necessary, to be in compliance with provincial and local environmental laws and regulations, SusGlobal submits applications to the respective authorities for approval prior to any necessary engineering being carried out. Our Growth Strategy SusGlobal owns 2 processing and production properties, one of which is under renovation, as part of a regional model and strategy which will be exported to other municipalities in North America and globally. The processing facilities, one of which is under development, have production lines, warehouses, research and development and offices. The Company will continue to acquire, develop and monetize proprietary technologies and processes in the waste to regenerative products globally, focusing on implementing a robust intellectual property strategy. The Company will invest in research and development to bring more products to market and increase revenue and cash flow by increasing output, higher production speeds and overall efficiency of all segments of our business. Recent Developments On March 8, 2022, the Company made a deposit of $157,018 (C$200,000), after entering into a non-binding agreement to acquire a soil media, plant nutrients and amendments producer approved for organic use and specifically formulated for producing high-quality fruit and flowering crops, for an aggregate purchase price of $15,701,885 (C$20,000,000). On March 3, 2022 and March 7, 2022, the Company executed two unsecured convertible promissory notes with two investors (the "March 2022 Investors"), who purchased 25% original issue discount (the "OID") unsecured convertible promissory notes (the "The March 2022 Investor Notes") in the aggregate principal amount totaling $2,000,000 (the "Principal Amount") with such Principal Amount convertible into shares of the Company's common stock (the "Common Stock") from time to time triggered by the occurrence of certain events. The Notes carried an OID totaling $500,000 which is included in the principal balance of the Notes. The funds were received on March 7, 2022 and March 11, 2022. The Company and one of the investors entered into a Note Amendment in May 2022 changing the conversion price discount from 30% to 35%. The maturity date of the Notes is the earlier of (i) June 3 and 7, 2022, and (ii) the occurrence of a Liquidity Event (as defined in the Notes) (the "Maturity Date"). The final payment of the Principal Amount (and default interest, if any) shall be paid by the Company to the Investors on the Maturity Date. On an event of default, the principal amount of the March 2022 Investor Notes will increase to 120% of their original principal amounts. On an event of default, the principal amount of the March 2022 Investor Notes will increase to 120% of their original principal amounts. The March 2022 Investors are entitled to convert all or any amount of the Principal Amount and any interest accruing at the default rate of 24% into Common Stock, at a conversion price (the "Conversion Price") equal to the lesser of 65% (representing a 35% discount) multiplied by the liquidity event price per share of the Common Stock or the greater of the closing price per share of the Company s Common Stock as reported by the applicable trading market on the trading day immediately prior to the conversion date times the applicable discount noted above or $1.70 multiplied by the discount as noted above. On December 8, 2021, the Company entered into a settlement agreement (the "Minutes of Settlement") and mutual release with its former chief executive officer, Gerald Hamaliuk. Investing in our securities involves a high degree of risk. See "Risk Factors" beginning on page 16 of this prospectus. You should carefully consider these risk factors, as well as the information contained in this prospectus, before purchasing any of the securities offered by this prospectus. We are an "Emerging Growth Company" as defined under the federal securities laws and may elect to comply with reduced public company reporting requirements. Please read "Implications of Being an Emerging Growth Company" beginning on page 11 of this prospectus for more information. Per Unit Total Public offering price $ $ Underwriting discounts and commissions (1) $ $ Proceeds, before expenses, to us (2) $ $ Proceeds to Selling Stockholders, before expenses to us (3) $ $ (1) We have also agreed to issue Warrants to purchase shares of our Common Stock to the underwriters and to reimburse the underwriters for certain expenses. See "Underwriting" on page 72 for additional information regarding total underwriting compensation. (2) The amount of offering proceeds to us presented in this table does not give effect to any exercise of the: (i) Underwriters' Over-Allotment Option we have granted to the underwriters as described below and (ii) the Representative's Warrants being issued to the underwriters in this offering. (3) The amount of offering proceeds to us presented in this table does not give effect to any issuance or sale of the Selling Stockholder Shares. We will receive no proceeds from the sale of any Selling Stockholder Shares. We have granted a 45-day option to the underwriters, exercisable one or more times in whole or in part, to purchase up to an additional 360,000 shares of Common Stock and/or Warrants to purchase up to 360,000 shares of Common Stock (equal to 15% of the number of shares of Common Stock and Warrants underlying the Units sold in the offering), from us in any combination thereof, at the public offering price less the underwriting discount and commissions solely solely to cover over-allotments, if any (the "Underwriters' Over-Allotment Option"). NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. The underwriters expect to deliver the securities against payment in New York, New York on or about, 2022. Book-Running Manager Co Book-Running Manager Spartan Capital Securities, LLC Revere Securities LLC The date of this prospectus is ____ __, 2022 Pursuant to the Minutes of Settlement, the Company agreed to pay Mr. Hamaliuk approximately $275,000 (C$347,500). This payment was made on December 8th. Pursuant to the Minutes of Settlement, Mr. Hamaliuk agreed to return 502,875 of the Company's Common Stock which the Company received and later canceled on December 29, 2021. In addition, pursuant to the Minutes of Settlement, Mr. Hamaliuk released any claim to or interest in 825,000 shares of the Company's Common Stock which Mr. Hamaliuk had pledged as security to Pace Savings and Credit Union Limited ("PACE") in connection with PACE's loans to the Company. These 825,000 shares are now being held by the Company's current chief executive officer, Marc Hazout, as security for his personal guarantee of the Company's obligations to PACE and the charge against the Company's leased premises owned by Haute Inc., an Ontario company controlled by Mr. Hazout On December 2, 2021, the Company executed one convertible promissory note with an investor in the amount of $350,000 bearing interest at 10% per annum, due at the earlier of June 2, 2022 and upon the occurrence of an event of default. On December 6, 2021, the Company received proceeds of $302,000, net of transaction related expenses of $48,000, including an original issue discount of $35,000. The investor also received 214,286 shares of Common Stock of the Company, as an incentive fee. The proceeds were used primarily to satisfy the settlement agreement noted above. On October 28, 2021 and October 29, 2021, the Company executed two convertible promissory notes with the Selling Stockholders, Quick Capital LLC ("Quick Capital") and Target Capital 2 LLC ("Target"), totaling $1,765,118 with net proceeds to the Company in the amount of $1,330,000, net of an original issue discount and other financing costs, in total, $435,118. On November 3, 2021, the Company received $1,330,000 on the execution of the convertible promissory notes. The convertible promissory notes bear interest at the rate of 15% annually and are due July 28 and 29, 2022. On October 27, 2021, the Company signed a consulting agreement with a consultant for a term of six months to provide financial and business consulting, for a fee of $50,000 and 62,500 restricted shares of the Company's Common Stock. Further, on October 28, 2021, the Company signed a consulting agreement with a consultant for a term of six months to provide financial and business consulting for a fee of 10,000 restricted shares of the Company's Common Stock. In addition, 95,000 Selling Shareholder Shares held by Alchemy Advisory LLC ("Alchemy") were obtained pursuant to a six-month Consultancy Agreement dated March 3, 2022. Under all three advisory agreements, the restricted shares of the Company's common stock will survive a reverse stock split prior to listing. The shares of Common Stock underlying the convertible promissory notes and the consulting shares of Common Stock are being registered in the registration statement of which this prospectus forms a part. The Company signed an Offset Development and Marketing Agreement (the "Agreement") with Blue Source Canada ULC ("Bluesource") to develop and market greenhouse gas offset credits from the Company's 49-acre Organic & Non-Hazardous Waste Processing & Composting Facility in Belleville, Ontario, in order for the Company to monetize and realize benefits from its voluntary activities. This monetization is an exciting development for the Company's mission to reduce organic wastes from wood, leaf and yard material, treated municipal sewage waste (biosolids), residential curbside green bin material or SSO and paper sludge otherwise destined for landfills and, we believe, will also allow the Company to expand this mission. Bluesource has pioneered creative solutions to climate change for over 20 years. Today, this partnership complements Bluesource's portfolio of high-quality environmental products from over 20 different technologies in over 100 locations across the United States and Canada. The partnership with SusGlobal is a core example of Bluesource's experience in identifying, creating, acquiring and marketing offsets, where there is a tangible environmental benefit. On August 17, 2021, the Company acquired certain assets located in Hamilton, Ontario, Canada, consisting of land, a vacant building and Environmental Compliance Approvals ( ECAs ). The total purchase price including costs of acquisition of $175,615 (C$221,680) totaled $3,590,773 (C$4,532,633). The costs of acquisition were settled through cash payments of $119,094 (C$150,333) and the issuance of 50,000 common shares valued based on the trading price on the issuance date at $56,521 (C$71,347) to a consultant who assisted on the closing of the transaction. The issuance of common shares is also noted under capital stock, note 17 to the December 31, 2021 consolidated financial statements, common shares issued for professional services. The purchase of the Hamilton Property was funded by cash of $396,364 (C$500,333), the issuance of 75,000 common shares to the vendor on closing, having a value based on the trading price on the issuance date of $84,781 (C$107,020), the issuance noted above of 50,000 common shares to a consultant who assisted on the closing of the transaction disclosed as part of common shares issued for professional services, vendor take-back 1st mortgage of $1,584,400 (C$2,000,000) and a portion of the increased existing 1st mortgage of $1,468,686 (C$1,853,933), disclosed under note 12(d), long-term debt. The cost of the purchase price was allocated ratably over the estimated fair value of each long-lived asset acquired, land of $1,724,979 (C$2,177,442) and building $1,556,002 (C$1,964,141). Refer to note 8 to the December 31, 2021 consolidated financial statements, for details of the balance of the purchase price representing ECAs acquired. Through and including, 2022 (the 25th day after the date of this prospectus), all dealers effecting transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to a dealer's obligation to deliver a prospectus when acting as an underwriter and with respect to an unsold allotment or subscription. You should rely only on the information contained in this prospectus. Neither we, the Selling Stockholders, nor the underwriter have authorized anyone to provide any information or to make any representations other than those contained in this prospectus we have prepared. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the securities offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date. For investors outside of the United States: We have not, the Selling Stockholders have not, and the underwriters have not, done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than the United States. Persons outside of the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of the shares of Common Stock and the distribution of this prospectus outside of the United States. TRADEMARKS This prospectus includes our trademarks which are our property and are protected under applicable intellectual property laws. This prospectus also includes trademarks and trade names that are the property of other organizations. Solely for convenience, trademarks and trade names referred to in this prospectus appear without the and symbols, but those references are not intended to indicate that we will not assert, to the fullest extent under applicable law, our rights, or that the applicable owner will not assert its rights, to these trademarks and trade names. We do not intend our use or display of other companies trade names or trademarks to imply a relationship with, or endorsement or sponsorship of us by, any other companies. Purchase of Additional Lands On November 12, 2020, the Company acquired additional lands described in the Company's Share Purchase Agreement (the "SPA") of 1684567 Ontario Inc. ("1684567"), in May of 2019. The additional lands include a 6.60-acre licensed gravel pit and a 0.20 acre right of way for a purchase price of $164,934 (C$210,000) plus the applicable harmonized sales tax. The Company is now the owner of a 49-acre land parcel at its Belleville, Ontario, Canada, organic waste processing and composting facility. The purchase was funded through an additional advance of $549,780 (C$700,000) on its existing 1st mortgage. The funds received, $407,810 (C$519,238), were net of financing fees of $57,904 (C$73,725) and expenses including accrued interest, property taxes and other disbursements of $90,134 (C$114,762). The new first mortgage of $2,591,820 (C$3,300,000) was registered on November 12, 2020. The terms of the new 1st mortgage are as noted under long-term debt, note 13(e) to the consolidated financial statements for the years ended December 31, 2020 and 2019, including an interest rate at the higher of the Royal Bank of Canada's prime rate plus 7.55% (currently 10% per annum) and 10% per annum, and the principal amount is due December 1, 2021. Management used a portion of the additional advance to satisfy certain obligations with Pace Savings and Credit Union Limited ("PACE"). Refer to new business developments above, for details on the increase in the existing 1st mortgage to $4,081,480 (C$5,200,000), with a new maturity date of September 1, 2022. SusGlobal Receives Trademark Registration for LEADERS IN THE CIRCULAR ECONOMY After having filed on March 13, 2019, trademark applications in Canada and the United States, on July 16, 2020, the Company announced it had received a Certificate of Registration from the United States Patent and Trademark Office ("USPTO") for the trademark LEADERS IN THE CIRCULAR ECONOMY (the "Mark"). The Mark was registered under Registration Number 6,098,063 on July 7, 2020 on the Supplemental Register. The registration will be in effect for an initial term of ten years, expiring on July 7, 2030, with the option of renewing the registration for successive ten-year terms for the following class: treatment and processing of organic waste; organic waste disposal services, namely, destruction and recycling of waste; organic waste management services, namely, converting waste into energy; recycling of organic waste; technical consulting in the field of waste management, namely, consulting in the field of waste treatment; recycling of plastic; recycling, namely, transform biosolids and organic waste into a pathogen free recognized organic fertilizer and compost and regenerative products, namely, biogas, electricity, liquid fertilizer, compost. Now that the Mark is registered, the Company is permitted to use indicia of registration (e.g., , or phrases such as "Reg. U.S. Pat. and T.M. Office"). SusGlobal Receives a Certificate of Registration for the Trademark EARTH's JOURNEY and the Trademark CARING FOR EARTH'S JOURNEY On November 24, 2020, the Company received a Certificate of Registration from the United States Patent and Trademark Office for the trademark EARTH's JOURNEY and trademark CARING FOR EARTH'S JOURNEY (the "Marks"). The Marks were registered under Registration Number 6,197,171 and Registration Number 6,195,955 on November 10, 2020 on the Supplemental Register. The registrations will be in effect for an initial term of ten years, expiring November 10, 2030, with the option of renewing the registrations for successive ten-year terms. Now that the Marks are registered, it is permitted to use indicia of registration (e.g. , or phrases such as "Reg U.S. Pat. And T.M. Office"). SusGlobal to Commence Integration of The Ydro Process(R) at Its Belleville Organic Waste Processing and Composting Facility On May 27, 2020, the Company announced it has agreed to commence The Ydro Process integration into the existing operations at the Organic Waste Processing and Composting Facility of its wholly owned subsidiary SusGlobal Energy Belleville Ltd. ("SusGlobal Belleville"). TradeWorks Environmental's Ydro Process is integrated into the existing SusGlobal Belleville operations by applying the Ydro Series Microorganisms product once during the preparation stage of the batches in the appropriate Gore system windrows. The integration of the Ydro Process is expected to: Reduce: Odors generated from the composting processing, its products (compost), as well as its by-products (i.e., leachate). Energy requirements, and the electrical consumption for aeration-heating purposes. Increase: Degradation/decomposition rate and efficiency of the composting process. Composting process and reduce the compost processing time. Composting performance and efficiency of the system. System's composting capacity and composting cycles (over its design limit). Compost quality, compost maturity, N:P:K & C:N ratio. Composting temperature (naturally, through the biological activity). Energy Retrofit Program On January 15, 2020, the Independent Electrical System Operator (the "IESO") pre-approved the Company's Save on Energy Retrofit Program Application (the "Program"). The total cost of the Program was $93,161 (C$118,692). As the Program was successfully completed, the Company, on April 15, 2021, received the hydro grant from the IESO of $45,910 (C$58,491), plus the applicable harmonized sales taxes. The Program was designed to realize a savings of approximately 50% in hydro costs annually, with an overall return on investment estimated at 125%. Effects of COVID-19 In December 2019, COVID-19 was reported. On March 11, 2020, the World Health Organization characterized COVID-19 as a pandemic. Developments in this area continue daily at the local, provincial and national levels. The Company has taken steps, consistent with directions from local, provincial and federal authorities, to mitigate known risks with the health and safety of its employees and customers as its first priority. The outbreak of COVID-19 was declared a national emergency. Many provinces and municipalities in Canada, announced aggressive actions to reduce the spread of COVID-19, including limiting non-essential gatherings of people, ceasing all non-essential travel, ordering certain businesses and government agencies to cease non-essential operations at physical locations and issuing "social or physical distancing" orders, which direct individuals to remain at their places of residence (subject to limited exceptions). COVID-19 poses the risk that we or our employees, contractors, customers, government and third-party payors and others may be prevented from conducting business activities for an indefinite period of time, including due to spread of the disease within these groups or due to shutdowns that have been and may continue to be requested or mandated by governmental authorities. The Company has acted on the aggressive emergency measures set in place by the provincial government and federal authorities, keeping in mind, firstly, the immediate health and safety of our employees and customers. Employees in the head office, located in Toronto, Ontario, Canada had been working remotely for some time or alternating their office time, ensuring there is no more than one employee present, ensuring they are social distancing and wearing protective face covering within the office and elsewhere outside the office, as per the measures set in place by provincial and local authorities. Employees at the site in Belleville, Ontario, Canada, have also been following the same procedures. The Company has prohibited face to face meetings and all meetings are now and for some time, being held by teleconference. The Company is fortunate that its operations have not been forced to close as we are considered an essential service. In the early stages of COVID-19, the receipt of organic waste had increased, the likely impact of the requirement for the public to stay in their residences, unless they themselves are employed in an essential business or service. A broad, sustained outbreak of COVID-19 will negatively impact our results and financial condition for the following reasons; (i) a large percentage of our customers are municipalities and their limited operations have resulted in a delay in the collection of outstanding receivables in the early months of COVID-19, impacting our cash flows, including the use of cash; (ii) members of the board, management or employee team, some of whom are particularly at-risk for the severe symptoms of COVID-19, or of our small number of other employees, may become ill or have family members who are ill and are absent as a result, or they may elect not to come to work due to the illness affecting others in our office or facility; and (iii) the outbreak may materially impact our operations for a sustained period of time due to the current travel bans and restrictions, quarantines, social or physical distancing orders and shutdowns. The occurrence of any of the these noted events and potentially others, could have a material adverse effect on our business, financial condition and results of operations. The COVID-19 outbreak and mitigation measures have had and may continue to have an adverse impact on global economic conditions which could have an adverse effect on our business and financial condition. The extent to which the COVID-19 outbreak impacts our results will depend on future developments that are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of COVID-19, the variants and the actions to contain its impact. To date, there has been no material impact on the Company's workforce, operations, financial performance, liquidity, or supply chain as a result of COVID-19. However, the ultimate duration and severity of COVID-19 or its effects on the economy, the capital and credit markets, or the Company's workforce, customers, and suppliers, as well as governmental and regulatory responses, are uncertain. Risks Affecting Us Our business is subject to numerous risks and uncertainties, including those discussed in the section titled "Risk Factors" beginning on page 16 and elsewhere in this prospectus. These risks include the following: our ability to continue as a going concern is in doubt absent obtaining adequate new debt or equity financing and achieving sufficient sales levels; because we have a limited operating history, it is difficult to evaluate our business and future prospects and increases the risks associated with an investment in our securities; in the normal course of business, we are exposed to market risks, including changes in interest rates, certain commodity prices and Canadian currency rates. The Company does not use derivatives to manage these risks. the rapidly-changing, unsure and/or deleterious effects of the COVID-19 pandemic on the job markets and general economy; if we are unable to respond to technological advancements and other changes in our industry by developing and releasing new services, or improving our existing services, in a timely and cost-effective manner or at all, our business could be materially and adversely affected; our future growth depends in part on our ability to form new and maintain existing strategic partnerships with third-party providers and continued performance of such providers under the terms of our strategic partnerships with them; because we rely on a small number of customers for a substantial portion of our revenue, the loss of any of these customers would have a material adverse effect on our operating results and cash flows; if we are unable to compete effectively, our business and operating results will be materially and adversely affected. Management Our executives are seasoned professionals in the renewables industry. Our key executives have participated in multiple successful exits, orchestrated investments and M&A transactions and have extensive business and financial acumen. Marc Hazout, Chairman and Chief Executive Officer (the "CEO"): Mr. Hazout founded SusGlobal Energy Corp., and currently serves as a Director, Executive Chairman, President and CEO. Mr. Hazout brings over 25 years of experience in public markets, finance and business operations to SusGlobal Energy Corp. Over the past several years Mr. Hazout has been involved in acquiring, restructuring and providing management services, as both a Director and an Officer, to several publicly traded companies. In 1998, Mr. Hazout founded and has been President and CEO of Travellers International Inc., a private equity firm headquartered in Toronto. Travellers has been involved in a multitude of successful capital market transactions over the past two decades. Mr. Hazout attended York University in Toronto studying International Relations and Economics. Mr. Hazout speaks English, French, and Hebrew. Ike Makrimichalos, CFO: Mr. Makrimichalos is a Chartered Professional Accountant (Chartered Accountant), with over 25 years of experience in servicing public and private companies, including manufacturing, automotive, technology & telecommunications and insurance, for Deloitte LLP in Toronto. Mr. Makrimichalos has served as a Chief Financial Officer and Controller in the mining sector for companies with global operations and multiple filing jurisdictions and currently also serves as a Chief Financial Officer in the financial services sector, along with providing financial consulting services for several private companies. Mr. Makrimichalos graduated from the University of Toronto with a Bachelor of Arts degree. Corporate Information Our principal executive offices are located at 200 Davenport Road, Toronto, Ontario, Canada, M5R 1J2. Our telephone number is (416) 223-8500. Our website address is www.susglobalenergy.com. The information contained on, or that can be accessed through, our website is not a part of this prospectus. Investors should not rely on any such information in deciding whether to purchase our securities. Implications of Being an Emerging Growth Company and Smaller Reporting Company As a company with less than $1.07 billion in revenue during our most recently completed fiscal year, we qualify as an "emerging growth company" as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As an emerging growth company, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable, in general, to public companies that are not emerging growth companies. These provisions include: an exemption from compliance with the auditor attestation requirement on the effectiveness of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act; an exemption from compliance with any requirement that the Public Company Accounting Oversight Board may adopt regarding mandatory audit firm rotation or a supplement to the auditor's report providing additional information about the audit and the financial statements; reduced disclosure about our executive compensation arrangements; exemptions from the requirements to obtain a non-binding advisory vote on executive compensation or a stockholder approval of any golden parachute arrangements; and extended transition periods for complying with new or revised accounting standards. We will remain an emerging growth company until the earliest to occur of: (i) the date we qualify as a "large accelerated filer," with at least $700 million of equity securities held by non-affiliates; and (ii) December 31, 2022, which is the last day of the fiscal year ending after the fifth anniversary of the completion of our offering registered on a registration statement on Form S-4 (2017). We may take advantage of these exemptions until such time that we are no longer an emerging growth company. Accordingly, the information contained herein may be different than the information you receive from other public companies. We are also a smaller reporting company as defined in the Securities Exchange Act of 1934, as amended, or the Exchange Act. We may continue to be a smaller reporting company even after we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as our voting and non-voting common stock held by non-affiliates is less than $250.0 million measured on the last business day of our second fiscal quarter, or our annual revenue is less than $100.0 million during the most recently completed fiscal year and our voting and non-voting common stock held by non-affiliates is less than $700.0 million measured on the last business day of our second fiscal quarter. Nasdaq Listing and Reverse Stock Split We have applied to list of our Common Stock on the Nasdaq Capital Market. If our application to the Nasdaq Capital Market is not approved or we otherwise determine that we will not be able to secure the listing of the Common Stock on the Nasdaq Capital Market, we will not complete the offering. Except as otherwise indicated, all references to our Common Stock, share data, per share data and related information has been adjusted to reflect the reverse stock split ratio of 1-for-4 ("Reverse Stock Split") as if it was effective and as if it had occurred at the beginning of the earliest period presented. The Reverse Stock Split, combined each four (4) shares of our outstanding Common Stock into one (1) share of Common Stock, without any change in the par value per share. The Reverse Stock Split was effected [_____] via the filing of a certificate of amendment with the Secretary of the State of Delaware pursuant to Section 242(a)(3) of the Delaware General Corporation Law to effectuate the Reverse Stock Split. No fractional shares were be issued in connection with the Reverse Stock Split and all such fractional interests were rounded up to the nearest whole number of shares of Common Stock. The conversion or exercise prices of our issued and outstanding convertible securities will be adjusted accordingly. THE OFFERING Issuer SusGlobal Energy Corp. Securities Offered by Us 2,400,000 Units, each consisting of one share of Common Stock and one warrant to purchase one share of Common Stock (the "Warrant"). The Units will not be certificated or issued in stand-alone form. The shares of our Common Stock and the Warrants comprising the Units are immediately separable upon issuance and will be issued separately, and will expire on the fifth anniversary of the original issuance date. The 2,400,000 Unit amount referenced above is based on the Units being sold at the offering price of $5.00 for gross proceeds of $12 million. Public Offering Price An assumed offering price of $5.00 per Unit. The actual offering price per unit will be as determined between Spartan Capital Securities, LLC and Revere Securities LLC, the representatives of the underwriters, and us at the time of pricing and may be issued at a discount to the current market price of our Common Stock. Description of Warrants included in Units The exercise price of the Warrants is $6.00 per share (120% of the public offering price of one Unit). Each Warrant is exercisable for one share of Common Stock, subject to adjustment in the event of stock dividends, stock splits, stock combinations, reclassifications, reorganizations or similar events affecting our Common Stock as described herein. A holder may not exercise any portion of a Warrant to the extent that the holder, together with its affiliates and any other person or entity acting as a group, would own more than 4.99% of the outstanding Common Stock after exercise, as such percentage ownership is determined in accordance with the terms of the Warrants, except that upon notice from the holder to us, the holder may waive such limitation up to a percentage, not in excess of 9.99%. We do not intend to list the Warrants for trading on any stock market or exchange. Each Warrant will be exercisable immediately upon issuance and will expire five years after the initial issuance date. If (i) the VWAP for each of 3 consecutive trading days (the "Measurement Period") exceeds $12 (subject to adjustment for forward and reverse stock splits, recapitalizations, stock dividends and the like after the closing date) and the holders are not in possession of any information that constitutes, or might constitute, material non-public information which was provided by the Company, any of its subsidiaries, or any of their officers, directors, employees, agents or affiliates, then the Company may, within 1 trading day of the end of such Measurement Period, call for cancellation of all, and only all, of the Warrants issued pursuant to the Underwriting Agreement for which a Notice of Exercise has not yet been delivered for consideration equal to $0.001 per warrant share. This prospectus also relates to the offering of the shares of Common Stock issuable upon exercise of the Warrants. Over-allotment option We have granted the underwriters an option to purchase up to an additional 360,000 shares of Common Stock and/or Warrants to purchase up to 360,000 shares of Common Stock (equal to 15% of the number of shares of Common Stock and Warrants underlying the Units sold in the offering), from us in any combination thereof, at the public offering price less the underwriting discount and commissions solely to cover over-allotments, if any. The Underwriter may exercise this option in full or in part at any time and from time to time until 45 days after the date of this prospectus. Common Stock Offered by Selling Stockholders The Selling Stockholders are offering 1,319,534 shares of Common Stock. The Common Stock offered by the Selling Stockholders includes: (i) 1,152,034 shares of Common Stock issuable upon the conversion of convertible notes held by three Selling Stockholders (at a conversion price of 65% of the public offering price for two holders and 70% of the public offering price for one holder); (ii) 167,500 consultancy shares of Common Stock held by two Selling Stockholders (these 167,500 shares were already issued to the Selling Stockholders and will not be adjusted for any reverse stock split). The 1,152,034 shares of common stock offered by the Selling Stockholders is defined herein as the "Selling Stockholder Shares." For a more detailed description of the convertible notes, see "Selling Stockholders." Common Stock outstanding prior to this offering 25,439,242 shares of Common Stock outstanding as of May 13, 2022. Common Stock to be outstanding after this offering 28,991,276 shares (assuming that none of the Warrants are exercised) including the conversion of notes in the principal amount of $3,765,118 into 1,152,034 shares of Common Stock. The Common Stock shares to be outstanding following this offering will be 31,391,276 if the Warrants offered hereby are exercised in full. If the Underwriter's over-allotment option is exercised in full, the total number of shares of Common Stock outstanding immediately after this offering would be 29,351,276 (assuming that none of the Warrants are exercised) and 31,751,276 if the Warrants offered hereby are exercised in full. Excluded are the securities described on page 15 below. Use of proceeds We estimate that the net proceeds to us from this offering will be approximately $10,480,000, after deducting underwriting discounts and commissions and estimated offering expenses payable by us or $12,100,000 if the Underwriter exercises its over-allotment option in full. We will not receive any proceeds from the sale of the Selling Stockholder Shares by the Selling Stockholders. We intend to use the net proceeds of this offering primarily for general corporate purposes, including working capital, expanded sales and marketing activities, increased research and development expenditures and funding our growth strategies. See "Use of Proceeds" for additional information. Representative's Warrant We have agreed to issue to the Representative (or its permitted assignees) Warrants to purchase up to a total of 144,000 shares of Common Stock (6% of the shares of Common Stock included in the Units and issuable upon exercise of the Warrants, excluding the over-allotment, if any). We are registering hereby the issuance of the Representative's Warrants and the shares of Common Stock issuable upon exercise of the Warrants. The Warrants will be exercisable at any time, and from time to time, in whole or in part, during the four- and one-half year period commencing 180 days from the effective date of the registration statement of which this prospectus is a part, which period is in compliance with FINRA Rule 5110(e)(1). The Warrants are exercisable for cash or on a cashless basis at a per share price equal to $6 per share, or 120% of the public offering price per Unit in the offering. Please see "Underwriting-Representative's Warrants" for a further description of these Warrants. Proposed Nasdaq Capital Market Trading Symbol and Listing We have applied to list our Common Stock on the Nasdaq Capital Market under the symbol "SNRG". No assurance can be given that such listing will be approved or that a liquid trading market will develop for our Common Stock. The approval of such listing on the Nasdaq Capital Market is a condition of closing this offering. We do not intend to list the Warrants for trading on any stock market or exchange and such warrants will expire five years from the date of issuance. Lock-ups We, our directors, executive officers, and shareholders who own 5% or more of the outstanding shares if our common stock have agreed with the underwriters not to offer for sale, issue, sell, contract to sell, pledge or otherwise dispose of any of our common stock or securities convertible into common stock for a period of 180 days, commencing on [ ], 2022. See "Underwriting" for additional information.
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and article of association are to the amended and restated memorandum and articles of association that the company will adopt prior to the consummation of this offering; Companies Act are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; founder shares are to our Class B ordinary shares initially issued to our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof (for the avoidance of doubt, such Class A ordinary shares will not be public shares ); management or our management team are to our executive officers and directors (including our directors nominees that will become directors in connection with the consummation of this offering); ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private placement warrants are to the warrants to be issued to our sponsor in a private placement simultaneously with the closing of this offering and upon conversion of working capital loans, if any; public shares are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) and for the avoidance of doubt, do not include the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares; public shareholders are to the holders of our public shares, including our sponsor and management team to the extent our sponsor and/or members of our management team purchase public shares, provided that our sponsor s and each member of our management team s status as a public shareholder will only exist with respect to such public shares; public warrants are to the warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); rights refer to the rights which are being sold as part of the units in this offering; sponsor are to Spring Valley Acquisition Sponsor II, LLC, a Delaware limited liability company; warrants are to our private placement warrants, public warrants and any warrants we issue to our sponsor upon conversion of loans; and we, us, our, company or our company are to Spring Valley Acquisition Corp. II, a Cayman Islands exempted company. Any forfeiture of shares described in this prospectus will take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option and assumes the forfeiture by our sponsor (and other holders, as applicable) of an aggregate of 1,000,000 founder shares. TABLE OF CONTENTS The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. The prospectus is not an offer to sell these securities nor a solicitation of an offer to buy these securities in any jurisdiction where the offer and sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, Dated September 26, 2022 Spring Valley Acquisition Corp. II $200,000,000 20,000,000 Units Spring Valley Acquisition Corp. II is a blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to as our initial business combination. We have not selected any potential business combination target and we have not, nor has anyone on our behalf, had any substantive discussions, directly or indirectly, with any potential business combination target. While we will not be limited to a particular industry or geographic region in our identification and acquisition of a target company, we intend to focus our search for a target operating in an alternative energy industry, including clean energy and storage, smart grid/efficiency, environmental services and recycling, mobility, water and wastewater management, advanced materials and technology enabled services. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share, one right and one-half of one redeemable public warrant. Each right entitles the holder thereof to receive one-tenth (1/10) of one Class A ordinary share upon the consummation of our initial business combination. No fractional shares will be issued upon conversion of any rights. As a result, a rights holder must have 10 rights in order to receive a Class A ordinary share at the closing of our initial business combination. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment, terms and limitations as described herein. The underwriters have a 45-day option from the date of this prospectus to purchase up to 3,000,000 additional units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination, subject to the limitations as described herein. We will have 15 months from the closing of this offering to consummate an initial business combination. However, if we anticipate that we may not be able to consummate our initial business combination within 15 months, we may, but are not obligated to, extend the period of time to consummate a business combination by an additional three months (for a total of up to 18 months from the closing of this offering to complete an initial business combination), as described in more detail in this prospectus. Public shareholders will not be offered the opportunity to vote on or redeem their shares in connection with any such extension. If we have not consummated an initial business combination within the above time period, we will redeem 100% of the public shares for cash, subject to applicable law and certain conditions as described herein. Our sponsor, Spring Valley Acquisition Sponsor II, LLC, has agreed to purchase 12,000,000 warrants (or 13,350,000 warrants if the underwriters over-allotment option is exercised in full), each exercisable to purchase one Class A ordinary share at $11.50 per share, subject to adjustment, at a price of $1.00 per warrant, in a private placement to occur concurrently with the closing of this offering. Our initial shareholders currently own 7,666,667 Class B ordinary shares, up to 1,000,000 of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised. The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described herein. Prior to our initial business combination, only holders of our Class B ordinary shares will be entitled to vote on the appointment of directors. Our sponsor has agreed that upon and subject to the completion of the initial business combination, 25% of the Class A ordinary shares then held by the sponsor (as a result of the conversion of the Class B ordinary shares into Class A ordinary shares as described above) shall be considered to be newly unvested shares, which will vest only if the closing price of our Class A ordinary shares on the Nasdaq Global Market ( Nasdaq ) equals or exceeds $12.50 for any 20 trading days within a 30 trading day period, on or after the first anniversary of the closing of the initial business combination but before the fifth anniversary. Class A ordinary shares, if any, that remain unvested at the fifth anniversary of the closing of the initial business combination will be forfeited, subject to certain exceptions as described in the letter agreement. Currently, there is no public market for our securities. We intend to apply to have our units listed on Nasdaq under the symbol SVIIU. We expect that the Class A ordinary shares, rights and public warrants comprising the units will begin separate trading on the Nasdaq under the symbols SVII, SVIIR and SVIIW, respectively, on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless Citigroup Global Markets Inc. and Guggenheim Securities, LLC permit earlier separate trading and we have satisfied certain conditions. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 41 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit Total Public offering price $ 10.00 $ 200,000,000 Underwriting discounts and commissions(1) $ 0.55 $ 11,000,000 Proceeds, before expenses, to us $ 9.45 $ 189,000,000 (1) Includes $0.35 per unit, or $7,000,000 in the aggregate (or $8,050,000 in the aggregate if the underwriters over-allotment option is exercised in full), payable to certain of the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States as described herein and released to the underwriters only upon the consummation of an initial business combination. See also Underwriting for a description of underwriting compensation payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $205,000,000, or $235,750,000 if the underwriters over-allotment option is exercised in full (initially $10.25 per unit in either case), will be deposited into a U.S. based trust account at Morgan Stanley & Co. LLC., (or at another U.S.-chartered commercial bank with consolidated assets of $100 billion or more) with Continental Stock Transfer & Trust Company acting as trustee. Except with respect to interest or other income earned on the funds held in the trust account that may be released to us to pay our income taxes, if any, our amended and restated memorandum and articles of association, as discussed herein and subject to the requirements of law and regulation, will provide that the proceeds from this offering and the sale of the private placement warrants held in the trust account will not be released from the trust account (1) to us, until the completion of our initial business combination, or (2) to our public shareholders, until the earliest of (a) the completion of our initial business combination, and then only in connection with those Class A ordinary shares that such shareholders properly elected to redeem, subject to the limitations described herein, (b) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 18 months if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) from the closing of this offering or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares, and (c) the redemption of our public shares if we have not consummated our business combination within 15 months (or up to 18 months if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) from the closing of this offering, subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2022. Book-Running Managers Citigroup Guggenheim Securities The date of this prospectus is , 2022 TABLE OF CONTENTS GENERAL We are a recently incorporated blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to as our initial business combination. We have not selected any potential business combination target and we have not, nor has anyone on our behalf, had any substantive discussions, directly or indirectly, with any potential business combination target. We will seek to capitalize on the significant experience and vast network of our management team (including our board of directors) and Pearl Energy Investment Management, LLC ( Pearl, and together with our management team, our Team ) to complete our initial business combination. Although we may pursue our initial business combination in any business, industry or geographic location, we currently intend to focus on opportunities that capitalize on the expertise and ability of our Team, particularly our executive officers, to identify, acquire and operate a business in the broadly-defined sustainability industry. Our Team has been investing and advising in the sustainability sector for over 25 years and our targeted sectors include, but are not limited to, renewable energy (with a focus on solar and wind, energy storage and other decarbonization technologies), resource optimization (including energy efficiency and digitization), environmental services (including waste management, pollution control and recycling) and grid infrastructure (technologies to support an aging and intermittent grid) (collectively, Sustainability ) in the United States and other developed countries. We believe our Team s collective background and the favorable macroeconomic and social trends disrupting the Sustainability industry will provide an opportunity to execute a potentially transformational business combination. We believe that there are significant attractive investment opportunities focused on improving the planet that are centered around a core sustainability theme. Growth in the Sustainability industry is driven by a series of macroeconomic and social trends. Macroeconomic trends contributing to growth in the Sustainability industry include urbanization, population growth, increased government spending and increased regulatory requirements at the federal, state and local level. In addition, various social trends, such as the increased focus on Environmental, Social and Governance ( ESG ) practices and business models as well as ESG increasingly becoming a core mandate for fund managers, are leading to an increased global focus on sustainability. As a result, we believe the Sustainability industry has the potential to undergo profound changes similar to other industries in the past, such as the transportation industry with airline deregulation in the 1970s and telecom industry following the emergence of wireless technology in the 1990s. We believe that we are well-positioned to identify attractive businesses in the Sustainability industry that would benefit from access to the public markets and the diverse skill set of our management team. We intend to focus on evaluating established companies with leading competitive positions, experienced management teams, attractive financial profiles and robust long-term potential for growth and profitability. We believe many businesses in the Sustainability industry could benefit from access to the public markets but have been unable to do so due to a number of factors, including the time it takes to conduct a traditional initial public offering, market volatility and pricing uncertainty. Our objective is to consummate our initial business combination with such a business and enhance stakeholder value by identifying and recruiting management, pursuing additional acquisitions, implementing operational improvements and expanding its product offerings and geographic footprint. We intend to utilize our Team s experience, reputation and contacts across the industry to achieve this objective. An affiliate of Pearl also formed and sponsored Spring Valley Acquisition Corp. ( Spring Valley I ), a special purpose acquisition company similar to our company that was formed to consummate an initial business combination. Spring Valley I completed its initial public offering in November 2020, in which it sold 23,000,000 units, each consisting of one Class A ordinary share of Spring Valley I and one-half of one redeemable warrant to purchase one Class A ordinary share of Spring Valley I, for an offering price of $10.00 per unit, generating aggregate gross proceeds of $230,000,000. In December 2021, Spring Valley I announced its plans to consummate a business combination transaction with NuScale Power, LLC, an industry leading provider of proprietary and innovative advanced nuclear small modular reactor ( SMR ) technology (the NuScale merger ). The NuScale merger, which had an enterprise value of approximately $1.9 billion, closed in May 2022. Concurrently with the execution of the merger agreement in December 2021 (other than two investors who entered into subscription agreements in March 2022 and April 2022, TABLE OF CONTENTS respectively), Spring Valley I entered into subscription agreements with certain investors to subscribe for an aggregate of 23,700,002 shares of common stock of the post-closing company, NuScale Power Corporation, for an aggregate commitment amount of $235,000,000 (the PIPE Investment ). The PIPE Investment was consummated concurrently with the closing of the NuScale Merger. TABLE OF CONTENTS OUR TEAM Christopher Sorrells serves as our Chief Executive Officer and as Chairman of our board of directors. Mr. Sorrells served as the Chief Executive Officer and a director of Spring Valley I from its inception in November 2020 until the closing of the NuScale merger in May 2022 at which time Mr. Sorrells began serving as a member of the board of directors of the post-closing company, NuScale Power Corporation. Mr. Sorrells also plans to devote a portion of his time sourcing sustainability-focused investments for Pearl s private equity funds. Mr. Sorrells has been an investor, operator, advisor and board member in the Sustainability industry for over 20 years. Mr. Sorrells served as Lead Director and Chairman of the compensation committee for Renewable Energy Group, Inc. (Nasdaq: REGI) until the completion of its merger with Chevron Corporation for $3.1 billion in June 2022, having previously served as Vice Chairman of its board and led the $100 million financing in 2006 to create the company, ultimately witnessing revenues increase from approximately $85 million in 2008 to over $3.0 billion in 2021, via organic growth and an aggressive acquisition strategy. In addition, the stock price for REGI appreciated significantly following its initial public offering in January 2012 of $10 per share to the $61.50 acquisition price paid by Chevron. Previously, Mr. Sorrells served as a Managing Director and then as an Operating Partner of NGP Energy Technology Partners ( NGP ETP ), an affiliate of Natural Gas Partners ( NGP ), a leading energy private equity fund with $20 billion of assets under management, which he helped grow into one of the most successful Sustainability-focused private equity funds. Mr. Sorrells and/or his former firms including NGP ETP have invested in over 30 Sustainability platforms in a broad range of companies across the Sustainability industry, including Renewable Energy Group, Inc. (Nasdaq: REGI), Power-One, Inc. (formerly Nasdaq: PWER), Caminus Corporation (formerly Nasdaq: CAMZ), Waste Resource Management, Inc., TPI Composites, Inc. (Nasdaq: TPIC) and others. In addition to leading investments, Mr. Sorrells has held a number of board positions for numerous public and private firms, including ENGlobal Corporation (Nadsaq: ENG), groSolar (which was later sold to EDF Renewables Inc.), Community Energy (which was later sold to AES Corporation), GSE Systems, Inc. (Nasdaq: GVP) and Living Earth (which was later sold to Bain Capital Double Impact). As an operator, Mr. Sorrells has held a variety of senior executive leadership roles at Sustainability-focused companies including serving as Chief Operating Officer and Director of GSE Systems, Inc. Mr. Sorrells started his career in the energy, power and Sustainability industries as an investment banker at Salomon Smith Barney in 1996 and later at Banc of America Securities LLC where he created one of the first Sustainability-focused investment banking teams in 2000. Mr. Sorrells received his Master of Accounting from University of Southern California, an M.B.A. from The College of William and Mary and a B.A. from Washington and Lee University. Robert Kaplan serves as our Chief Financial Officer and Vice President of Business Development. Mr. Kaplan served as the Vice President of Business Development of Spring Valley I from its inception in November 2020 until the closing of the NuScale merger in May 2022. Mr. Kaplan has over 20 years of investment banking experience in the Sustainability industry. Mr. Kaplan has been involved in over 60 transactions totaling approximately $6 billion in transaction value. Mr. Kaplan was most recently Managing Director of Clean Technologies / Renewables at Stifel Financial Corp. ( Stifel ). In this role, Mr. Kaplan was responsible for the firm s capital markets and advisory services in various sustainability subsectors, including, clean energy, biofuels, energy storage, energy efficiency, mobility and environmental technologies. He joined Stifel in 2010 in connection with Stifel s acquisition of Thomas Weisel Partners Group, Inc. ( TWP ) in 2010. Mr. Kaplan joined TWP in 2007 as a Vice President in the Technology investment banking group with a focus on sustainable technologies. Prior to joining TWP, Mr. Kaplan started his investment banking career at First Albany where he was a founding member of one of the first Sustainability-focused banking franchise on Wall Street. During his tenure at First Albany, he completed many of the industry s first public offerings in various sustainability subsectors, such as solar, alternative fuels, mobility, fuel cells and the smart grid. Mr. Kaplan serves on the board of directors of TWO NIL, LLC. Mr. Kaplan received a B.S. in Finance from Lehigh University and an M.B.A. from the NYU Stern School of Business. David Buzby will serve as a board member upon the closing of this offering. Mr. Buzby has over 30 years of business experience in sustainability, renewable energy, and technology, including forming several billion-dollar public companies in the Sustainability industry as well as raising $1.5 billion of co-investment from institutional investors over a period of 30 years. Currently, Mr. Buzby is chair of the board of directors of Stem, Inc. (NYSE: STEM), a leading energy storage/grid services company in North America, where he has served since 2010. Mr. Buzby is also on the board of directors of Climate Transition TABLE OF CONTENTS Capital Acquisition I B.V. (AEX: CTAI) ( Climate ), a climate transition special purpose acquisition company that completed its initial public offering in June 2021, and Leading Edge Equipment Technologies, Inc., a privately held company that develops solar wafers. In addition, he was an early investor and board member in Sunrun Inc. (NASDAQ: RUN) from 2008 through 2012, helping lead the company to complete its initial public offering in 2015, to attain a leading market share in residential solar in the United States in 2018 and to a current market capitalization of approximately $6.0 billion as of January 2022. Mr. Buzby was also a founding investor, Chairman and Chief Executive Officer, of SunEdison (NASDAQ: SUNE) helping create one of North America s leading solar developers before selling the company to MEMC Electronic Materials, Inc. (NYSE: WFR) in 2009 for approximately $323 million including earn-out value. Mr. Buzby was also a founding investor and board member and chair of the audit committee of ValueClick (NASDAQ: VCLK) which conducted its initial public offering in 2000 and subsequently sold to Alliance Data Systems Corporation (NYSE: ADS) for approximately $2.3 billion in 2014. Mr. Buzby has held 12 board seats of both public and private companies and held various senior executive roles in numerous companies, including Chairman, Chief Executive Officer, Chief Operating Officer and Chief Financial Officer. Mr. Buzby received his M.B.A. from Harvard Business School and a B.A. from Middlebury College. Richard Thompson will serve as a board member upon the closing of this offering. Mr. Thompson served as a member of the board of directors of Spring Valley I from its inception in November 2020 until the closing of the NuScale merger in May 2022. Mr. Thompson has over 35 years of international business experience in renewable energy, power electronics and semiconductors, including several billion-dollar public exits in the Sustainability industry. Currently, Mr. Thompson is a strategic adviser to Sumeru Equity Partners, a technology-focused private equity firm, in which he has served since 2014. From 2014 to 2016, he was Executive Chairman of AVI-SPL, an approximately $700 million privately held, global leader in video communications. From 2008 to October 2013, Mr. Thompson was President, Chief Executive Officer and a Director of Power-One, Inc. (formerly Nasdaq: PWER), a leading provider of renewable energy and power conversion solutions. During his tenure, he successfully led the company through restructuring to become one of the largest renewable energy inverter suppliers worldwide, generating over $1 billion in sales in 2012, along with its sale to ABB (NYSE: ABB) for over $1 billion in equity value. Prior to joining Power-One, Inc., Mr. Thompson was Chief Financial Officer of American Power Conversion Corporation (Nasdaq: APCC) from 2005 to 2007, which was acquired in March 2007 by a French competitor, Schneider Electric SA (Paris: SU.PA), in an auction for approximately $6 billion in enterprise value. From 1997 to 2005, Mr. Thompson was Chief Financial Officer of Artesyn Technologies (Nasdaq: ATSN) and was instrumental in creating one of the leading power component companies in the industry which was later sold to Emerson (NYSE: EMR) for $500 million. In addition to his role at Artesyn, he was also General Manager of Spider Software and led the company s merger with Zytec Inc. that created a robust power component and computer board business. Sharon Youngblood will serve as a board member upon the closing of this offering. Dr. Youngblood is a biologist with training in the fields of immunology and molecular genetics. She has served on the faculty of several institutions, and has been a consultant in the Biomedical applications in the semiconductor industry. Dr. Youngblood has held research associate positions at both the Howard Hughes Institute and the Molecular Cardiology department at University of Texas Southwestern. After completing almost 20 years in scientific research, she moved into non-profit work. She has served on five boards over the past 30 years with a focus on wildlife, conservation, sustainability and education. As a current board member of The World Wildlife Fund (the WWF ), on which she has served since 2013, she currently serves on the conservation and development committees. WWF is a non-for-profit corporation whose mission is to conserve nature and reduce the most pressing threats to the diversity of life on Earth. In addition to wildlife conservation, the organization aims to create a sustainable, healthy, and productive environment for nature and humans to co-exist. In addition, she has served on the board of directors of the Dallas Zoological Society from 1991 to 1994 and Presbyterian Health Resources from 2005 to 2011. She has also served as a trustee at the Hockaday School from 2008 to 2014 and the St. Philips School from 2012 to 2018. After receiving a BS in biophysics from Southern University, she completed her PhD at MIT, followed by postdoctoral training at University of Texas Southwestern. Dr. Youngblood belongs to numerous organizations including the National Wildlife Federation, The Humane Society of the United States, ASPCA, WWF, The Sierra Club, Ocean Conservancy and Nature Conservancy. TABLE OF CONTENTS David Levinson will serve as a board member upon the closing of this offering. Mr. Levinson is a Managing Director and Chief Operating Officer of Pearl, where he concentrates on transaction due diligence and execution, serves on Pearl portfolio company Boards and maintains Pearl s compliance program. Prior to joining Pearl, Mr. Levinson worked in William J. Quinn s family office starting in 2013 managing the office and his investment portfolio until forming Pearl in 2015. From 2003 to 2013, Mr. Levinson worked at GTx, Inc., a biotechnology company located in Memphis, Tennessee, in various positions before departing in 2013 as Director of Business Development, Licensing and Financial Analysis. While at GTx, Mr. Levinson was involved in all aspects of the transaction process, including deal sourcing, due diligence, financial analysis, term sheet negotiation and execution for numerous completed transactions. Mr. Levinson was also a part of the finance team where he created and implemented GTx s budgeting and forecasting processes and worked on the company s IPO in 2004 and subsequent follow-on offerings. In addition, while at GTx, he served on the disclosure control committee, was Secretary of the Audit Committee and served on the executive steering committee. From 1996-2000, Mr. Levinson previously gained valuable deal execution experience working as a corporate associate at Dechert LLP, a Philadelphia-based law firm. Mr. Levinson s practice focused on mergers and acquisitions of both public and private companies, as well as public securities work. Mr. Levinson graduated summa cum laude and Phi Beta Kappa from the University of Pennsylvania, where he earned his B.A. in Economics in 1993. Mr. Levinson also earned his J.D. with honors from the University of Chicago in 1996 and earned his M.B.A. from the Fuqua School of Business at Duke University in 2002, where he was a Fuqua Scholar. Kevin Pohler will serve as a board member upon the closing of this offering. Mr. Pohler is a Vice President of Pearl, where he concentrates on investment strategy and sourcing, transaction due diligence and execution, monitoring portfolio companies and investor relations. Prior to joining Pearl in 2015, Mr. Pohler was an Analyst at Goldman, Sachs & Co. Group in New York. Mr. Pohler received a B.A. in Economics with honors from Harvard College and an M.B.A. from the Stanford University Graduate School of Business. We will be supported by Pearl, a Dallas, Texas-based investment firm with $1.7 billion of committed capital under management as of June 2022. Pearl was founded by William Quinn in 2015 and focuses on partnering with best-in-class management teams to invest in the North American energy industry, typically targeting opportunities requiring $25 million to $100 million of equity capital. Over the course of their careers, the principals at Pearl have executed on billions of dollars of aggregate transaction value through direct investment, financing and acquisitions, with experience spanning venture to late stage buyout and across all parts of the business cycle. We will further be supported by our team of advisors from leading global companies with experience in a wide range of subsectors and functional areas. This support is intended to provide us with access to their expertise and extensive industry networks from which we plan to source and evaluate targets as well as devise plans to optimize any business that we acquire. TABLE OF CONTENTS BUSINESS STRATEGY Our acquisition and value creation strategy is to identify and complete our initial business combination with a Sustainability-focused company that builds upon the vast industry experience and expertise of our Team. We expect to develop our pipeline of opportunities for a potential business combination through our management team s over 100 cumulative years of experience, deep relationships and extensive network of corporate executives, board members, venture capital and private equity firms, family offices, investment bankers, lawyers, investors and other service providers to the Sustainability industry. We have an extensive history of launching successful investment platforms through proactive and highly selective sourcing of potential targets by analyzing the entire value chain to determine the best balance of risk and reward segment. Utilizing this approach, we have helped build large public and private platforms in the global sustainability and energy markets. Our selection process will leverage our Team s broad and deep relationship network, distinct industry experiences and extensive deal-sourcing capabilities to access a broad spectrum of differentiated opportunities. We expect to develop this network through our Team s broad experience, with demonstrated success in both investing in and operating businesses across a variety of industries and at numerous stages of these companies life cycles. We have developed a distinctive combination of capabilities, which includes: an established record of building industry-leading companies and strong ability to deliver shareholder value over an extended time period; experience using acquisitions to grow companies during periods of both economic growth and decline by using extensive deal-sourcing and differentiated transaction execution/structuring capabilities; experience deploying value creation strategies, including recruiting talented personnel, implementing system upgrades with the back-office systems, and delivering operating efficiency by implementing an analytical based approached to business metrics; and extensive capital markets experience across various business cycles, including financing businesses and assisting companies with transition to public ownership. We intend to focus our efforts on opportunities where our Team s strategic vision, operating expertise, deep relationships and capital markets experience can be catalysts to enhance the growth, competitive position and financial upside in an initial business combination. We intend to identify and execute an initial business combination within the Sustainability industry in the United States or other developed countries, although we may pursue targets in any business, industry, sector, or geographical location. Our Team has an established history in identifying and capitalizing on key trends that have shaped the global sustainability and energy markets and has helped build leading platforms to scale within the marketplace. OUR COMPETITIVE STRENGTHS Our intent is to identify and complete our initial business combination with a company that complements the experience of our Team and can benefit from our distinct combination of skills in investing, financing, advising and operating. Our Team has a substantial deal-making skillset developed throughout their collective careers and has created significant shareholder value across several high-profile transactions, including: As lead investor in 2006, Mr. Sorrells brought together a combination of strategic and financial partners to lead a $100 million investment for the sole purpose of creating Renewable Energy Group, Inc. (Nasdaq: REGI), one of the largest global biodiesel and renewable diesel companies. At the time, this investment was noted as one of the largest investments in biodiesel in North America and helped transform an emerging industry into a growing and vibrant sector. Renewable Energy Group, Inc. s revenues grew from approximately $85 million in 2008 to over $3.0 billion in 2021 via organic growth and an aggressive acquisition strategy. In addition, the stock price for Renewable Energy Group, Inc. appreciated significantly since its initial public offering in January 2012 of $10 per share to the $61.50 acquisition price paid by Chevron. TABLE OF CONTENTS From 2008 to 2012, as Chief Executive Officer and director, Mr. Thompson successfully led Power-One, Inc. through restructuring, and helped the company increase its revenue from approximately $537.5 million in 2008 to approximately $1 billion in 2012 and become one of the largest renewable energy inverter suppliers worldwide. In July 2013, Mr. Thompson successfully completed the sale of Power-One, Inc. to ABB (NYSE: ABB) for over $1 billion in equity value. In 2007, as Chief Financial Officer of American Power Conversion Corporation (Nasdaq: APCC), Mr. Thompson helped negotiate the sale of the company to Schneider Electric SA (Paris: SU.PA) for approximately $6 billion in enterprise value. Mr. Buzby has spent the last 20 years of his career innovating business models and financial structures to accelerate the adoption of clean energy. As the founding investor, Chairman and Chief Executive Officer at SunEdison (NASDAQ: SUNE), Mr. Buzby created the commercial solar Power Purchase Agreement ( PPA ) in 2002, building one of the largest commercial solar developers before its sale to MEMC Electronic Materials, Inc. in 2009. Utilizing that knowledge in 2007 to help launch SunRun as an investor and director with a residential version of the PPA, Mr. Buzby helped create a leading market share in residential solar in the United States in 2018 with an approximately $6.0 billion market capitalization as of January 2022 (NASDAQ: RUN). The increasing adoption of solar energy that he pioneered allowed Mr. Buzby to become the founding investor, and now Chairman, of Stem, Inc. (NYSE: STEM), so that solar, wind and energy storage resources could be increasingly scaled and integrated with the broader infrastructure; again creating a market-leading company. Stem, Inc. completed a merger with Star Peak Energy Transition Corp. in April 2021. Dr. Youngblood s 20 years of scientific research in the fields of immunology and molecular genetics as well as her specialties including biotech/life sciences, education and consulting combined with her functional expertise in environment and conservation as well as research and development provide a foundation to assist the Company in analyzing next generation sustainability companies targeting our end markets. Many of our potential deals will involve either a technology and/or science angle and her ability to help think through the challenges and provide industry contacts will be invaluable. In addition, her passion for conservation and sustainability has enabled her to create a strong network of professionals, deal makers, and service providers in our target industries which provides us potential deal flow, assistance with due diligence, industry consultants, and potential board members for our target acquisition post close. Among these transactions, we have helped pioneer business models and technologies and have deployed assets that have changed the way we produce or transport energy and power while contributing to the significant growth in clean energy and power. We expect to draw upon this vast set of experiences with a goal of affecting a business combination and build a market-leading business. With respect to the above, past performance of our Team or their respective affiliates is not a guarantee of either (i) success with respect to a business combination that may be consummated or (ii) the ability to successfully identify and execute a transaction. You should not rely on the historical record of our Team or their respective affiliates as indicative of future performance. See Risk Factors Past performance by our Team or their respective affiliates may not be indicative of future performance of an investment in us, and we may be unable to provide positive returns to shareholders. For a list of our executive officers and entities for which a conflict of interest may or does exist between such officers and the company, please refer to Management Conflicts of Interest. INDUSTRY OPPORTUNITY We believe our Team s extensive and diversified experience in Sustainability will help us to effectively evaluate targets across the Sustainability industry. We believe Sustainability is attractive for a number of reasons: Large Target Market. According to estimates from the International Renewable Energy Agency, between 2016 and 2050, global cumulative investments in renewables could total approximately $13 trillion, while cumulative investments in energy efficiency could total approximately $29 trillion. We believe this growth is driven by continued innovation that has reduced capital costs versus incumbent processes as well TABLE OF CONTENTS as a global acceleration in electrification. For instance, in the clean energy industry, the cost of large-scale and residential photovoltaic solar power has decreased 82% and between 47% to 80% (depending on the region), respectively, since 2010, according to the International Renewable Energy Agency. This cost reduction in large-scale photovoltaic installations makes it less expensive to build and operate a solar installation than a coal fired power plant in many parts of the world. In addition, according to industry sources, the trend towards electrification in mobility has pushed passenger electric vehicle sales from 450,000 cars in 2015 to 2.1 million in 2019 and is expected to account for 54 million cars, or approximately 58%, of new car sales by 2040. Favorable Trends. The Sustainability industry is defined by significant growth in a set of dynamic and changing industries. We believe the significant growth in Sustainability is driven by a series of macroeconomic and social trends. Macroeconomic trends contributing to growth in the Sustainability industry include urbanization, population growth, increased government spending and increased regulatory requirements at the federal, state and local level. In addition, various social trends, such as the increased focus on ESG practices and business models as well as ESG increasingly becoming a core mandate for fund managers, are leading to an increased global focus on Sustainability, climate change and a reduced carbon footprint. We believe an ESG focus is becoming engrained in the fabric of socially conscious corporations, and that ESG standards are becoming an increasingly common benchmarking criteria for prospective employees. Broad Universe of Targets. We intend to focus our investment effort across the broad Sustainability industry. We believe the anticipated growth in the industry and the related sectors will present a substantial number of actionable opportunities with the required scale that fit our acquisition criteria. According to industry source Pitchbook, there were over 10,800 companies operating in the Sustainability industry as of February 2022. High Barriers to Entry. Success in Sustainability is driven by a myriad of global regulations, government spending and technological breakthroughs. We believe our Team s experience in the Sustainability industry over the past 25 years provides a significant amount of proprietary domain expertise and know-how in evaluating investment opportunities in a difficult-to-navigate industry. Further, our Team has spent considerable time navigating the complex regulatory environment inherent in the Sustainability industry, and its familiarity with the nuances of the regulatory aspect of the industry provides a differentiated competitive advantage. INVESTMENT APPROACH Upon completion of this offering, our Team plans to commence an extensive outreach program to its network and industry relationships to articulate the parameters for our search for a target company and a potential business combination and begin the process of pursuing and reviewing potential opportunities. We intend to capitalize on the following competitive advantages in our pursuit of a target company: Proactive and Proprietary Transaction Sourcing. We believe that our management team s over 100 cumulative years of deal experience, history of building leading platforms, proactive approach to sourcing transactions, and extensive network of relationships will provide the potential to access numerous investment opportunities. We believe our Team s deep industry expertise across Sustainability industries and throughout the capital structure makes a business combination with us an attractive option for Sustainability companies seeking capital solutions. Data Driven Analysis of Potential Opportunities. We believe that our Team has an established record of generating investment opportunities. Within targeted subsectors, we expect to employ an initial review of the entire value chain to determine the best risk / reward profiles of the subsector. In addition, we expect to analyze current trends, develop investment theses and create strategies for originating and evaluating investment opportunities. This research-oriented, data-intensive process would allow us to proactively identify trends, find opportunities and execute transactions ahead of potential competitors. Execution and Structuring Capability. We believe that our Team s transaction experience and reputation allow it to source and complete transactions requiring complex problem-solving skills and insight. Our Team has helped create several multi-billion dollar public and private companies that required these skills and deep industry insights. These types of transactions are typically complex and require creativity, industry knowledge and expertise, rigorous due diligence and extensive negotiation and documentation. TABLE OF CONTENTS Our Team has experience investing in many Sustainability-focused industries and has developed operational expertise at companies at varying stages of their life cycles. We plan to utilize this experience to help us generate investment opportunities with attractive risk / reward profiles based on their valuations, structural characteristics and relatively low levels of financial leverage. Significant Value-Add Capability. We believe the industry expertise and broad network of relationships of our Team will allow it to add significant value and therefore be a key selling point to attract high caliber acquisition targets. We plan to market our Team to potential target companies in a number of capacities, including: (i) assisting in setting strategic direction and priorities; (ii) designing specific performance-improvement projects; (iii) helping to identify and recruit managers; (iv) advising on acquisition and financing transactions; (v) contributing market information; (vi) positioning the company products and services with customers and various stakeholders; and (vii) developing a targeted investor relations program. Furthermore, our Team is also experienced in navigating complex regulatory issues that impact many companies that are part of certain subsectors within the Sustainability industry. Our Team believes that its ability to identify and implement value creation initiatives has been an essential driver of past performance and will remain central to our acquisition strategy. Broad and Extensive Experience in Both Public and Private Markets. Our Team has decades of combined operating, investing and financing experience across both public and private markets. We have created some of the leading Sustainability companies both in the public and private sector with significant revenue growth in target industries. We believe that this versatility of experience and complementary skills will help us to identify companies that could make successful public market candidates and prepare them to make the transition to robust publicly traded companies. BUSINESS COMBINATION CRITERIA Consistent with our strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses and, in evaluating a prospective target business, we expect to conduct a thorough due diligence review that will encompass, among other things, meetings with incumbent management and employees, document reviews and inspection of facilities, as applicable, as well as a review of financial and other information that will be made available to us. Sustainability Focus. We intend to focus on sustainable businesses positioned to benefit from macroeconomic and social trends impacting the economy. Established Businesses and Recognized Market Leaders. We expect to target businesses that are market leaders in their respective subsectors within the Sustainability industry, and may be better positioned to endure economic downturns, changes in the industry landscape and evolving customer, supplier and competitor preferences. Benefit from Being a Public Company. We intend to acquire one or more businesses that will benefit from being publicly traded and can effectively utilize the broader access to capital and the public profile that are associated with being a publicly traded company. Experienced Management Team. We will seek to partner with an experienced target team that can benefit from the distinct investment, advisory, operational experience, and contacts of our Team in the Sustainability industry. Attractive Financial Profile. We will seek to acquire a business that has strong recurring revenues, a margin profile with high steady-state margins or high incremental margins, and / or compelling long-term growth prospects. Leader in Technology Driven Transformation. We will seek to acquire a business or entity with a technological advantage that provides a high barrier to entry for new entrants, a defensible position in intellectual property and presents a low or manageable risk of technological obsolescence. Middle Market Businesses. We believe targeting businesses or entities in the middle market will provide the greatest number of opportunities for investment and will maximize the network, contacts and experience of our Team. It may also provide the optimal platform for further consolidation. TABLE OF CONTENTS Strong Free Cash Flow Generation or Near-Term Potential. We will seek to acquire a business or entity that already generates, or has the potential to generate, consistent and stable free cash flow. We plan to utilize our Team s extensive network of contacts, which provides access to differentiated deal flow and significant deal-sourcing capabilities, and use these criteria and guidelines to evaluate acquisition opportunities. However, we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that from time to time our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials that we would file with the SEC. OUR ACQUISITION PROCESS In evaluating a prospective target business, we expect to conduct an extensive due diligence review which may encompass, as applicable and among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities and a review of financial and other information about the target and its industry. We will also utilize our management team s operational and capital planning experience. Each of our directors and officers will, directly or indirectly, own founder shares and/or private placement warrants following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Our sponsor could potentially make a substantial profit on its investment even if the trading price of our ordinary shares significantly declines. See "Risk Factors The nominal purchase price paid by our sponsor for the founder shares may significantly dilute the implied value of your public shares in the event we consummate an initial business combination, and our sponsor is likely to make a substantial profit on its investment in us in the event we consummate an initial business combination, even if the business combination causes the trading price of our ordinary shares to decline materially. Further, such officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Our sponsor and its affiliates manage numerous investment vehicles which may compete with us for acquisition opportunities and if pursued by them we may be precluded from such opportunities for our initial business combination. In addition, certain of our officers and directors presently have, and any of them in the future may have additional, fiduciary or contractual obligations to other entities, including fiduciary or contractual obligations with respect to Climate, pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity subject to his or her fiduciary duties. As a result, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, then, subject to such officer s and director s fiduciary duties under Cayman Islands law, he or she will need to honor such fiduciary or contractual obligations to present such business combination opportunity to such entity, before we can pursue such opportunity. If these other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. However, we do not expect these duties to materially affect our ability to complete our initial business combination. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and us, on the other. TABLE OF CONTENTS INITIAL BUSINESS COMBINATION So long as our securities are then listed on the Nasdaq, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding any deferred underwriting commissions and taxes payable on the income earned on the trust account) at the time of the agreement to enter into our initial business combination. We refer to this as the 80% of net assets test. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or an independent valuation or appraisal firm with respect to the satisfaction of such criteria. While we consider it unlikely that our board will not be able to make an independent determination of the fair market value of a target business or businesses, it may be unable to do so if the board is less familiar or experienced with the target company s business, there is a significant amount of uncertainty as to the value of the company s assets or prospects, including if such company is at an early stage of development, operations or growth, or if the anticipated transaction involves a complex financial analysis or other specialized skills and the board determines that outside expertise would be helpful or necessary in conducting such analysis. Since any opinion, if obtained, would merely state that the fair market value of the target business meets the 80% of net assets threshold, unless such opinion includes material information regarding the valuation of a target business or the consideration to be provided, it is not anticipated that copies of such opinion would be distributed to our shareholders. However, if required under applicable law, any proxy statement that we deliver to shareholders and file with the SEC in connection with a proposed transaction will include such opinion. We anticipate structuring our initial business combination so that the post-business combination company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-business combination company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-business combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-business combination company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-business combination company, depending on valuations ascribed to the target and us in the business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-business combination company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. In addition, we have agreed not to enter into a definitive agreement regarding an initial business combination without the prior consent of our sponsor. If our securities are not then listed on the Nasdaq for whatever reason, we would no longer be required to meet the foregoing 80% of net assets test. To the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors. The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the funds we can use to complete another business combination. TABLE OF CONTENTS OTHER CONSIDERATIONS We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor or any of our officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions that such initial business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other context. We currently do not have any specific business combination under consideration. Our officers and directors have neither individually selected nor considered a target business nor have they had any substantive discussions regarding possible target businesses among themselves or with our underwriters or other advisors. Our management team is regularly made aware of potential business opportunities, one or more of which we may desire to pursue for a business combination, but we have not (nor has anyone on our behalf) contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to a business combination transaction with our company. Additionally, we have not, nor has anyone on our behalf, taken any substantive measure, directly or indirectly, to identify or locate any suitable acquisition candidate for us, nor have we engaged or retained any agent or other representative to identify or locate any such acquisition candidate. Our sponsor and its affiliates manage numerous investment vehicles which may compete with us for acquisition opportunities and if pursued by them we may be precluded from such opportunities for our initial business combination. In addition, certain of our officers and directors presently have, and any of them in the future may have additional, fiduciary and contractual duties to other entities, including fiduciary and contractual duties to Climate. As a result, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, then, subject to their fiduciary duties under Cayman Islands law, he or she will need to honor such fiduciary or contractual obligations to present such business combination opportunity to such entity, before we can pursue such opportunity. If these other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. However, we do not expect these duties to materially affect our ability to complete our initial business combination. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and us, on the other. Our sponsor, officers and directors may sponsor, form or participate in other blank check companies similar to ours during the period in which we are seeking an initial business combination. Any such companies may present additional conflicts of interest in pursuing an acquisition target, particularly in the event there is overlap among investment mandates. Any such companies, including Climate, may present additional conflicts of interest in pursuing an acquisition target. However, we do not currently expect that any such other special purpose acquisition company, including Climate, would materially affect our ability to complete our initial business combination. In addition, our sponsor, officers and directors, are not required to commit any specified amount of time to our affairs, and, accordingly, may have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. Mr. Sorrells plans to devote a portion of his time sourcing sustainability-focused investments for Pearl's private equity funds. CORPORATE INFORMATION Our executive offices are located at 2100 McKinney Ave, Suite 1675, Dallas, TX 75201, and our telephone number is (214) 308-5230. We maintain a corporate website at www.sv-ac.com. The information contained on or accessible through our corporate website or any other website that we may maintain is not part of this prospectus or the registration statement of which this prospectus is a part. TABLE OF CONTENTS We are a Cayman Islands exempted company. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and expect to receive, after the effectiveness of the registration statement of which this prospectus forms a part, a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Law (As Revised) of the Cayman Islands, for a period of 30 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.07 billion (as adjusted for inflation pursuant to SEC rules from time to time), or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that are held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of any fiscal year for so long as either (1) the market value of our ordinary shares held by non-affiliates does not equal or exceed $250.0 million as of the prior June 30th, or (2) our annual revenues did not equal or exceed $100.0 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates did not equal or exceed $700.0 million as of the prior June 30th. To the extent we take advantage of any reduced disclosure obligations, it may also make comparison or our financial statements with other public companies difficult or impossible. TABLE OF CONTENTS THE OFFERING In deciding whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors of this prospectus. Securities offered 20,000,000 units (or 23,000,000 units if the underwriters over-allotment option is exercised in full), at $10.00 per unit, each unit consisting of: one Class A ordinary share; one right to receive one-tenth of one Class A ordinary share upon the consummation of the initial business combination; and one-half of one redeemable public warrant. Proposed Nasdaq symbols Units: SVIIU Class A ordinary shares: SVII Rights: SVIIR Public warrants: SVIIW Trading commencement and separation of Class A ordinary shares, rights and public warrants The units are expected to begin trading on or promptly after the date of this prospectus. The Class A ordinary shares, rights and public warrants comprising the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless Citigroup Global Markets Inc. and Guggenheim Securities, LLC inform us of their decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the Class A ordinary shares, rights and public warrants commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into Class A ordinary shares, rights and public warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Additionally, the units will automatically separate into their component parts and will not be traded after completion of our initial business combination. Separate trading of the Class A ordinary shares, rights and warrants is prohibited until we have filed a Current Report on Form 8-K In no event will the Class A ordinary shares, rights and public warrants be traded separately until we have filed with the SEC a Current Report on Form 8-K that includes an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering and the sale of the private placement warrants. We will file the Current Report on Form 8-K which includes this audited balance sheet promptly after the closing of this offering. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current TABLE OF CONTENTS Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters over-allotment option. Units: Number outstanding before this offering 0 Number outstanding after this offering 20,000,000(1) Ordinary shares: Number outstanding before this offering 7,666,667(2)(3) Number outstanding after this offering 26,666,667(1)(2)(4) Rights: Number outstanding before this offering 0 Number outstanding after this offering 20,000,000(1) Warrants: Number of private placement warrants to be sold in a private placement simultaneously with this offering 12,000,000(1) Number of warrants to be outstanding after this offering and the sale of private placement warrants 22,000,000(1) Exercisability Each whole warrant is exercisable to purchase one Class A ordinary share at $11.50 per share, subject to adjustment as described herein. In addition, if (x) we issue additional Class A ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of the initial business combination at an issue price or effective issue price of less than $9.20 per Class A ordinary share (with such issue price or effective issue price to be determined in good faith by our board and, in the case of any such issuance to our sponsor or its affiliates, without taking into account any founder shares held by our sponsor or its affiliates, as applicable, prior to such issuance) (the newly issued price ), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (1) Assumes no exercise of the underwriters over-allotment option and the forfeiture by our sponsor of 1,000,000 founder shares. (2) Founder shares are currently classified as Class B ordinary shares, which shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described below adjacent to the caption Founder shares conversion and anti-dilution rights and in our amended and restated memorandum and articles of association. Such Class A ordinary shares delivered upon conversion will not have any redemption rights or be entitled to liquidating distributions from the trust account if we do not consummate an initial business combination. (3) Includes 1,000,000 founder shares that are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised. (4) Includes 20,000,000 public shares and 6,666,667 founder shares, assuming 1,000,000 founder shares have been forfeited. TABLE OF CONTENTS (z) the volume weighted average trading price of our Class A ordinary shares during the 20 trading day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the market value ) is below $9.20 per share, (i) the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 115% of the higher of the market value and the newly issued price, and (ii) the $18.00 per share redemption trigger price described below under Redemption of public warrants will be adjusted (to the nearest cent) to be equal to 180% of the higher of the market value and the newly issued price. Only whole warrants are exercisable. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We structured each unit to contain one-half of one redeemable public warrant, with each whole warrant exercisable for one Class A ordinary share, as compared to units issued by some other similar blank check companies which contain whole warrants exercisable for one whole share, in order to reduce the dilutive effect of the warrants upon completion of our initial business combination as compared to units that each contain a whole warrant to purchase one whole share, thus making us, we believe, a more attractive business combination partner for target businesses. Exercise period The warrants will become exercisable on the later of 30 days after the completion of our initial business combination or 12 months from the closing of this offering. The warrants will expire at 5:00 p.m., New York City time, five years after the completion of our initial business combination or earlier upon redemption or liquidation. On the exercise of any warrant, the warrant exercise price will be paid directly to us and not placed in the trust account. The private placement warrants purchased by our sponsor will not be exercisable more than five years from the effective date of the registration statement of which this prospectus forms a part, in accordance with FINRA Rule 5110(g)(8), as long as our sponsor or any of its related persons beneficially own such private placement warrants. No public warrants will be exercisable for cash unless we have an effective and current registration statement covering the Class A ordinary shares issuable upon exercise of the public warrants and a current prospectus relating to such Class A ordinary shares and such shares are registered, qualified or exempt from registration under the securities, or blue sky, laws of the state of residence of the holder. Redemption of public warrants Once the public warrants become exercisable, we may redeem the outstanding public warrants: in whole and not in part; at a price of $0.01 per public warrant; upon a minimum of 30 days prior written notice of redemption; and TABLE OF CONTENTS if, and only if, the last reported sale price (the closing price ) of our Class A ordinary shares equals or exceeds $18.00 per share (as adjusted for adjustments to the number of shares issuable upon exercise or the exercise price of a public warrant as described under the heading Description of Securities Warrants Public Shareholders Warrants Anti-Dilution Adjustments ) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. We will not redeem the public warrants as described above unless an effective registration statement under the Securities Act covering the issuance of the Class A ordinary shares issuable upon exercise of the public warrants is then effective and a current prospectus relating to those Class A ordinary shares is available throughout the 30-day redemption period or if we have elected to require the exercise of the public warrants on a cashless basis as described below. If and when the public warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. If we call the public warrants for redemption as described above, we will have the option to require all holders that wish to exercise such warrants to do so on a cashless basis. In determining whether to require all holders to exercise their public warrants on a cashless basis, we will consider, among other factors, our cash position, the number of public warrants that are outstanding and the dilutive effect on our shareholders of issuing the maximum number of Class A ordinary shares issuable upon the exercise of our public warrants. In such event, each holder would pay the exercise price by surrendering the warrants for that number of Class A ordinary shares equal to the quotient obtained by dividing (x) the product of the number of Class A ordinary shares underlying the warrants, multiplied by the difference between the exercise price of the warrants and the fair market value (defined below) by (y) the fair market value. The fair market value means the 10 day average closing price as of the date on which the notice of redemption is sent to the holders of the warrants. The 10-day average closing price means, as of any date, the average last reported sale price of the Class A ordinary shares as reported during the 10 trading day period ending on the trading day prior to such date. Last reported sale price means the last reported sale price of the Class A ordinary shares on the date prior to the date on which notice of exercise of the warrant is sent to the warrant agent. Please see Description of Securities Warrants Public Shareholders Warrants for additional information. Terms of Rights Each holder will receive one-tenth (1/10) of a Class A TABLE OF CONTENTS ordinary share upon consummation of our initial business combination. In the event we will not be the survivor upon completion of our initial business combination, each holder of a right will be required to affirmatively convert his, her or its rights in order to receive the one-tenth (1/10) share underlying each right (without paying any additional consideration) upon consummation of the business combination. If we are unable to complete an initial business combination within the required time period and we liquidate the funds held in the trust account, holders of rights will not receive any of such funds for their rights, and the rights will expire worthless. No fractional shares will be issued upon conversion of any rights. As a result, a rights holder must have at least 10 rights in order to receive a Class A ordinary share at the closing of our initial business combination. Founder shares On January 26, 2021, our sponsor paid $25,000, or approximately $0.004 per share, to cover certain expenses on our behalf in consideration of 5,750,000 Class B ordinary shares, par value $0.0001. In February 2021, our sponsor transferred 40,000 Class B ordinary shares to each of our director nominees. The per share price of the founder shares was determined by dividing the amount contributed to the company by the number of founder shares issued. On March 18, 2022, we effectuated a share capitalization with respect to our Class B ordinary shares of 1,916,667 shares thereof, resulting in our initial shareholders holding an aggregate of 7,666,667 founder shares. If we increase or decrease the size of this offering, we will effect a share capitalization or a share surrender or redemption or other appropriate mechanism, as applicable, with respect to our Class B ordinary shares immediately prior to the consummation of this offering in such amount as to maintain the number of founder shares, on an as-converted basis, at 25% of our issued and outstanding ordinary shares upon the consummation of this offering. Up to 1,000,000 founder shares are subject to forfeiture by the sponsor, depending on the extent to which the underwriters over-allotment option is exercised. The founder shares are identical to the Class A ordinary shares included in the units being sold in this offering, and holders of founder shares have the same shareholder rights as public shareholders, except that: prior to our initial business combination, only holders of the founder shares have the right to vote on the appointment of directors and holders of a majority of our founder shares may remove a member of the board of directors for any reason; the founder shares are subject to certain transfer restrictions contained in a letter agreement that our sponsor, directors and executive officers have entered or will enter into with us, as described in more detail below; TABLE OF CONTENTS pursuant to such letter agreement, our sponsor and each member of our management team have agreed to (i) waive their redemption rights with respect to their founder shares; (ii) waive their redemption rights with respect to their founder shares and public shares in connection with a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares and (iii) waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to consummate an initial business combination within 15 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). If we seek shareholder approval, we will complete our initial business combination only if we obtain the approval of an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the company, unless applicable law, our corporate governing documents or applicable stock exchange rules require a different vote, in which case we will complete our initial business combination only if such requisite vote is received. In such case, our sponsor and each member of our management team have agreed to vote their founder shares and public shares in favor of our initial business combination. As a result, in addition to our initial shareholders founder shares, we would need 6,666,668 or 33.3% (assuming all issued and outstanding shares are voted and the over-allotment option is not exercised), or none (assuming only the minimum number of shares representing a quorum are voted and the over-allotment option is not exercised), of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved; pursuant to the letter agreement, our sponsor has TABLE OF CONTENTS agreed that upon and subject to the completion of the initial business combination, 25% of the founder shares then held by the sponsor shall be considered to be newly unvested shares, which will vest only if the closing price of our Class A ordinary shares on Nasdaq equals or exceeds $12.50 for any 20 trading days within a 30 trading day period (the Share Price Level ) on or after the first anniversary of the closing of the initial business combination but before the fifth anniversary. Our sponsor has agreed, subject to exceptions, not to transfer any unvested founder shares prior to the date such securities become vested. Founder shares, if any, that remain unvested at the fifth anniversary of the closing of the initial business combination will be forfeited, subject to certain exceptions as described in the letter agreement. Notwithstanding the foregoing, and subject to the satisfaction of the other transfer restrictions on the founder shares described herein, our sponsor may be able to transfer up to 80% of its founder shares even if it is required to forfeit all of its unvested founder shares and even if the trading price of our Class A ordinary shares declines materially; the founder shares will automatically convert into our Class A ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described below adjacent to the caption Founder shares conversion and anti-dilution rights and in our amended and restated memorandum and articles of association; and the founder shares are entitled to registration rights. Transfer restrictions on founder shares Except as described herein, pursuant to a letter agreement with us, our sponsor and our directors and executive officers have agreed not to transfer, assign or sell any of their founder shares until the earliest of (A) one year after the completion of our initial business combination and (B) subsequent to our initial business combination, (x) if the closing price of our Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations and other similar transactions) for any 20 trading days within any 30-trading day period commencing at least 120 days after our initial business combination, or (y) the date on which we complete a liquidation, merger, share exchange or other similar transaction that results in all of our public shareholders having the right to exchange their ordinary shares for cash, securities or other property. Any permitted transferees would be subject to the same restrictions and other agreements of our sponsor and our directors and executive officers with respect to any founder shares. Founder shares conversion and anti-dilution rights The founder shares are designated as Class B ordinary shares and will automatically convert into Class A TABLE OF CONTENTS ordinary shares, which such Class A ordinary shares delivered upon conversion will not have any redemption rights or be entitled to liquidating distributions from the trust account if we do not consummate an initial business combination, at the time of our initial business combination or earlier at the option of the holders thereof at a ratio such that the number of Class A ordinary shares issuable upon conversion of all founder shares will equal, in the aggregate, on an as-converted basis, 25% of the sum of (i) the total number of ordinary shares issued and outstanding upon completion of this offering, plus (ii) the total number of Class A ordinary shares issued or deemed issued or issuable upon conversion or exercise of any equity-linked securities (as defined herein) or rights issued or deemed issued, by the company in connection with or in relation to the consummation of the initial business combination, excluding any Class A ordinary shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued, deemed issued, or to be issued, to any seller in the initial business combination and any private placement warrants issued to our sponsor, its affiliates or any member of our management team upon conversion of working capital loans. Any conversion of Class B ordinary shares described herein will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. In no event will the Class B ordinary shares convert into Class A ordinary shares at a rate of less than one-to-one. The term equity-linked securities refers to any debt or equity securities that are convertible, exercisable or exchangeable for our Class A ordinary shares issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt. Appointment of directors; Voting rights Prior to our initial business combination, only holders of our founder shares will have the right to vote on the appointment of directors. Holders of our public shares will not be entitled to vote on the appointment of directors during such time. In addition, prior to the completion of an initial business combination, holders of a majority of our founder shares may remove a member of the board of directors for any reason. These provisions of our amended and restated memorandum and articles of association may only be amended by a special resolution passed by not less than two-thirds of our ordinary shares who attend and vote at our general meeting which shall include the affirmative vote of a simple majority of our Class B ordinary shares. With respect to any other matter submitted to a vote of our shareholders, including any vote in connection with our initial business combination, except as required by law, holders of our founder shares and holders of our public shares will vote together as a single class, with each TABLE OF CONTENTS share entitling the holder to one vote. Private placement warrants Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 12,000,000 private placement warrants (or 13,350,000 private placement warrants if the underwriters over-allotment option is exercised in full), each exercisable to purchase one Class A ordinary share at $11.50 per share, subject to adjustment, at a price of $1.00 per warrant ($12,000,000 in the aggregate or $13,350,000 if the underwriters over-allotment option is exercised in full), in a private placement that will close simultaneously with the closing of this offering. If we do not complete our initial business combination within 15 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering, the private placement warrants will expire worthless. The private placement warrants will not be redeemable by us and will be exercisable on a cashless basis (see Description of Securities Warrants Private Placement Warrants ). The private placement warrants purchased by our sponsor will not be exercisable more than five years from the effective date of the registration statement of which this prospectus forms a part, in accordance with FINRA Rule 5110(g)(8), as long as our sponsor or any of its related persons beneficially own such private placement warrants. Transfer restrictions on private placement warrants The private placement warrants (including the Class A ordinary shares issuable upon exercise of the private placement warrants) will not be transferable, assignable or salable until 30 days after the completion of our initial business combination, except as described herein under Principal Shareholders Transfers of Founder Shares and Private Placement Warrants. Cashless exercise of private placement warrants If holders of private placement warrants elect to exercise them on a cashless basis, they would pay the exercise price by surrendering their warrants for that number of Class A ordinary shares equal to the quotient obtained by dividing (x) the product of the number of Class A ordinary shares underlying the warrants, multiplied by the excess of the 10-day average closing price as of the date prior to the date on which notice of exercise is sent or given to the warrant agent, less the warrant exercise price by (y) the 10-day average closing price. The 10-day average closing price means, as of any date, the average last reported sale price of the Class A ordinary shares as reported during the 10 trading day period ending on the trading day prior to such date. Last reported sale price means the last reported sale price of the Class A ordinary shares on the date prior to the date on which notice of exercise of the warrant is sent to the warrant agent. The reason that we have agreed that these warrants will be exercisable on a cashless basis so long as they are held by the sponsor or its permitted transferees is because it is not known at this time whether they will be affiliated with us following a TABLE OF CONTENTS business combination. If they remain affiliated with us, their ability to sell our securities in the open market will be significantly limited. We expect to have policies in place that restrict insiders from selling our securities except during specific periods. Even during such periods of time when insiders will be permitted to sell our securities, an insider cannot trade in our securities if they are in possession of material non-public information. Accordingly, unlike public shareholders who could sell the Class A ordinary shares issuable upon exercise of the public warrants freely in the open market, the insiders could be significantly restricted from doing so. As a result, we believe that allowing the holders to exercise such warrants on a cashless basis is appropriate. Proceeds to be held in trust account Of the proceeds we will receive from this offering and the sale of the private placement warrants described in this prospectus, $205,000,000, or $235,750,000 if the underwriters over-allotment option is exercised in full (initially $10.25 per unit in either case), will be deposited into a segregated trust account located in the United States at Morgan Stanley & Co. LLC., (or at another U.S.-chartered commercial bank with consolidated assets of $100 billion or more) with Continental Stock Transfer & Trust Company acting as trustee. The proceeds to be placed in the trust account include $7,000,000 (or $8,050,000 if the underwriters over-allotment option is exercised in full) in deferred underwriting commissions. Except with respect to interest or other income earned on the funds held in the trust account that may be released to us to pay our income taxes, if any, our amended and restated memorandum and articles of association, as discussed below and subject to the requirements of law and regulation, will provide that the proceeds from this offering and the sale of the private placement warrants held in the trust account will not be released from the trust account (1) to us, until the completion of our initial business combination, or (2) to our public shareholders, until the earliest of (a) the completion of our initial business combination, and then only in connection with those Class A ordinary shares that such shareholders properly elected to redeem, subject to the limitations described herein, (b) the redemption of any public shares properly tendered in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering or (B) with respect to any other provision relating to the rights of holders of TABLE OF CONTENTS our Class A ordinary shares, and (c) the redemption of our public shares if we have not consummated our business combination within 15 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering, subject to applicable law. Public shareholders who redeem their Class A ordinary shares in connection with a shareholder vote described in clause (b) in the preceding sentence shall not be entitled to funds from the trust account upon the subsequent completion of an initial business combination or liquidation if we have not consummated an initial business combination within 15 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering, with respect to such Class A ordinary shares so redeemed. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. Anticipated expenses and funding sources Except as described above with respect to the payment of income taxes, unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. The proceeds held in the trust account will be invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations. Assuming an interest rate of 3.268% per year, based on the closing rate for 3-month treasury bills on September 21, 2022, we estimate the interest earned on the trust account will be approximately $6,699,400 per year; however, we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from: the net proceeds of this offering and the sale of the private placement warrants not held in the trust account, which will be approximately $2,000,000 in working capital after the payment of approximately $1,000,000 in non-reimbursed expenses relating to this offering; and any loans or additional investments from our sponsor or an affiliate of our sponsor or certain of our officers and directors, although they are under no obligation to advance funds to us in such circumstances, and provided any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of our initial business combination. Conditions to completing our initial business combination So long as our securities are then listed on the Nasdaq, our initial business combination must occur with one or more target businesses that together have an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding any deferred TABLE OF CONTENTS underwriting commissions and taxes payable on the income earned on the trust account) at the time of the agreement to enter into our initial business combination. We refer to this as the 80% of net assets test. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. Our shareholders may not be provided with a copy of such opinion nor will they be able to rely on such opinion. If our securities are not then listed on the Nasdaq for whatever reason, we would no longer be required to meet the foregoing 80% of net assets test. We will complete our initial business combination only if the post-business combination company in which our public shareholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or is otherwise not required to register as an investment company under the Investment Company Act. Even if the post-business combination company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post-business combination company, depending on valuations ascribed to the target and us in the business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-business combination company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test, provided that in the event that the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking shareholder approval, as applicable. Permitted purchases and other transactions with respect to our securities If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, executive officers, advisors or their affiliates may purchase public shares, rights or warrants in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Additionally, at any time at or prior to our initial business combination, subject to applicable securities laws (including with respect to material nonpublic information), our sponsor, directors, executive officers, advisors or their affiliates may enter into transactions with investors and others to provide them with incentives to acquire public shares, vote their public shares in favor of our initial business combination or not redeem their public shares. However, they have no TABLE OF CONTENTS current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds held in the trust account will be used to purchase public shares, rights or warrants in such transactions. If they engage in such transactions, they will be restricted from making any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Securities Exchange Act of 1934, as amended (the Exchange Act ). We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. Additionally, in the event our sponsor, directors, executive officers, advisors or their affiliates were to purchase shares or warrants from public shareholders, such purchases would be structured in compliance with the requirements of Rule 14e-5 under the Exchange Act including, in pertinent part, through adherence to the following: our registration statement/proxy statement filed for our business combination transaction would disclose the possibility that our sponsor, directors, executive officers, advisors or any of their affiliates may purchase shares, rights or warrants from public shareholders outside the redemption process, along with the purpose of such purchases; if our sponsor, directors, executive officers, advisors or any of their affiliates were to purchase shares or warrants from public shareholders, they would do so at a price no higher than the price offered through our redemption process; our registration statement/proxy statement filed for our business combination transaction would include a representation that any of our securities purchased by our sponsor, directors, executive officers, advisors or any of their affiliates would not be voted in favor of approving the business combination transaction; our sponsor, directors, executive officers, advisors or any of their affiliates would not possess any redemption rights with respect to our securities or, if they do acquire and possess redemption rights, they would waive such rights; and we would disclose in a Form 8-K, before our security holder meeting to approve the business combination transaction, the following material items: the amount of our securities purchased outside TABLE OF CONTENTS of the redemption offer by our sponsor, directors, executive officers, advisors or any of their affiliates, along with the purchase price; the purpose of the purchases by our sponsor, directors, executive officers, advisors or any of their affiliates; the impact, if any, of the purchases by our sponsor, directors, executive officers, advisors or any of their affiliates on the likelihood that the business combination transaction will be approved; the identities of our security holders who sold to our sponsor, directors, executive officers, advisors or any of their affiliates (if not purchased on the open market) or the nature of our security holders (e.g., 5% security holders) who sold to our sponsor, directors, executive officers, advisors or any of their affiliates; and the number of our securities for which we have received redemption requests pursuant to our redemption offer. See Proposed Business Permitted Purchases and Other Transactions with Respect to Our Securities for a description of how our sponsor, directors, executive officers, advisors or their affiliates will select which shareholders to purchase securities from in any private transaction. The purpose of any such transaction could be to (1) increase the likelihood of obtaining shareholder approval of the business combination, (2) reduce the number of public warrants outstanding and/or increase the likelihood of approval on any matters submitted to the public warrant holders for approval in connection with our initial business combination, (3) reduce the number of rights outstanding and/or increase the likelihood of approval on any matters submitted to the rights holders for approval in connection with our initial business combination or (4) satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our securities may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Please see Risk Factors If we seek shareholder approval of our initial business combination, our sponsor, directors, executive officers, advisors or any of their affiliates may elect to purchase public shares, rights or warrants, which may influence a vote on a proposed business combination and reduce the TABLE OF CONTENTS public float of our securities. Redemption rights for public shareholders upon completion of our initial business combination We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of the initial business combination, including interest and other income earned on the funds held in the trust account and not previously released to us to pay our income taxes, if any, divided by the number of then-outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.25 per public share. The per share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. The redemption rights will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. There will be no redemption rights upon the completion of our initial business combination with respect to our rights or public warrants. Further, subject to the provisions of our amended and restated memorandum and articles of association (as further described below adjacent to Redemption of public shares and distribution and liquidation if no initial business combination ), we will not proceed with redeeming our public shares, even if a public shareholder has properly elected to redeem its shares, if a business combination does not close. Our sponsor and each member of our management team have entered into an agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and public shares held by them in connection with (i) the completion of our initial business combination and (ii) a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares. Limitations on redemptions Our amended and restated memorandum and articles of association will provide that in no event will we redeem our public shares in an amount that would cause our net tangible assets to be less than $5,000,001 (so that we do not then become subject to the SEC s penny stock rules). However, a greater net tangible asset or cash requirement may be contained in the agreement relating TABLE OF CONTENTS to our initial business combination. For example, the proposed business combination may require: (i) cash consideration to be paid to the target or its owners, (ii) cash to be transferred to the target for working capital or other general corporate purposes or (iii) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. Furthermore, although we will not redeem shares in an amount that would cause our net tangible assets to fall below $5,000,001, we do not have a maximum redemption threshold based on the percentage of shares sold in this offering, as many blank check companies do. In the event the aggregate cash consideration we would be required to pay for all Class A ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all Class A ordinary shares submitted for redemption will be returned to the holders thereof, and we instead may search for an alternate business combination. Manner of conducting redemptions We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a general meeting called to approve the business combination or (ii) by means of a tender offer. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under applicable law or stock exchange listing requirement or whether we were deemed to be a foreign private issuer (which would require a tender offer rather than seeking shareholder approval under SEC rules). Asset acquisitions and share purchases would not typically require shareholder approval, while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our issued and outstanding ordinary shares or seek to amend our amended and restated memorandum and articles of association would typically require shareholder approval. We currently intend to conduct redemptions in connection with a shareholder vote unless shareholder approval is not required by applicable law or stock exchange listing requirement or we choose to conduct redemptions pursuant to the tender offer rules of the SEC for business or other reasons. If we hold a shareholder vote to approve our initial business combination, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of TABLE OF CONTENTS the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and file proxy materials with the SEC. If we seek shareholder approval, we will complete our initial business combination only if we obtain the approval of an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a majority of the shareholders who attend and vote at a general meeting of the company, unless applicable law, our corporate governing documents or applicable stock exchange rules require a different vote, in which case we will complete our initial business combination only if such requisite vote is received. In such case, our sponsor and each member of our management team have agreed to vote their founder shares and public shares in favor of our initial business combination. As a result, in addition to our initial shareholders founder shares, we would need 6,666,668 or 33.3% (assuming all issued and outstanding shares are voted and the over-allotment option is not exercised), or none (assuming only the minimum number of shares representing a quorum are voted and the over-allotment option is not exercised), of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved. We intend to give approximately 30 days (but not less than 10 days nor more than 60 days) prior written notice of any such meeting, if required, at which a vote shall be taken to approve our initial business combination. These quorum and voting thresholds, and the voting agreements of our initial shareholders, may make it more likely that we will consummate our initial business combination. Each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction or vote at all. Our amended and restated memorandum and articles of association will require that at least five days notice will be given of any such general meeting. If we conduct redemptions pursuant to the tender offer rules of the SEC, we will, pursuant to our amended and restated memorandum and articles of association: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we and our sponsor will terminate any plan established in accordance with TABLE OF CONTENTS Rule 10b5-1 to purchase our Class A ordinary shares in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering more than the number of public shares we are permitted to redeem. If public shareholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete such initial business combination. Limitation on redemption rights of shareholders holding more than 15% of the shares sold in this offering if we hold shareholder vote Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. We believe the restriction described above will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us, our sponsor or our management at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be disbursed TABLE OF CONTENTS directly by the trustee to pay amounts due to any public shareholders who properly exercise their redemption rights as described above adjacent to the caption Redemption rights for public shareholders upon completion of our initial business combination, to pay the underwriters their deferred underwriting commission, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or the redemption of our public shares, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combination Our amended and restated memorandum and articles of association will provide that we will have only 15 months from the closing of this offering to consummate our initial business combination. However, if we anticipate that we may not be able to consummate our initial business combination within 15 months, we may extend the period of time to consummate a business combination one time by an additional three months (for a total of 18 months from the closing of this offering to complete an initial business combination), without submitting such proposed extension to our shareholders for approval or offering our public shareholders redemption rights in connection therewith. Pursuant to the terms of our amended and restated certificate of incorporation and the trust agreement to be entered into between us and Continental Stock Transfer & Trust Company, in order to extend the time available for us to consummate our initial business combination for an additional three months, our sponsor or its affiliates or designees must deposit into the trust account $2,000,000 (or up to $2,300,000 if the underwriters over-allotment option is exercised in full ($0.10 per Class A ordinary share in either case), adjusted proportionately in the case of a partial exercise), on or prior to the 15 month anniversary of the closing of this offering. Any such payments would be made in the form of a loan that will be non-interest bearing and payable upon the consummation of our initial business combination. Such loan may be converted into additional private placement warrants upon the consummation of our initial business combination, at a price of $1.00 per warrant, at the option of our sponsor. We will issue a press release announcing any extension, at least three days prior to TABLE OF CONTENTS the deadline. In addition, we will issue a press release the day after the deadline, announcing whether the funds have been timely deposited. If we complete our initial business combination, we would repay such loaned amounts out of the proceeds of the trust account released to us. If we do not complete a business combination, we will not repay such loans. We will only be able to effectuate one such extension and only for an additional three months in total. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination. If we have not consummated an initial business combination within 15 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering we will: (i) cease all operations except for the purpose of winding up; (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest and other income earned on the funds held in the trust account and not previously released to us to pay our income taxes, if any (less up to $100,000 of interest to pay dissolution expenses) divided by the number of the then-outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any); and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in the case of clauses (ii) and (iii), to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to consummate an initial business combination within 15 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering. Our sponsor and each member of our management team have entered into an agreement with us, pursuant to which they have agreed to waive their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to consummate an initial business combination within 15 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame). The underwriters have agreed to waive their rights to TABLE OF CONTENTS their deferred underwriting commission held in the trust account in the event we do not consummate an initial business combination within 15 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering and, in such event, such amounts will be included with the funds held in the trust account that will be available to fund the redemption of our public shares. Our sponsor, executive officers, directors and director nominees have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 15 months (or up to 18 months if we extend the period of time to consummate a business combination) from the closing of this offering or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares; unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest and other income earned on the funds held in the trust account and not previously released to us to pay our income taxes, if any, divided by the number of the then-outstanding public shares, subject to the limitations described above adjacent to the caption Limitations on redemptions. For example, our board of directors may propose such an amendment if it determines that additional time is necessary to complete our initial business combination. In such event, we will conduct a proxy solicitation and distribute proxy materials pursuant to Regulation 14A of the Exchange Act seeking shareholder approval of such proposal and, in connection therewith, provide our public shareholders with the redemption rights described above upon shareholder approval of such amendment. This redemption right shall apply in the event of the approval of any such amendment, whether proposed by our sponsor, any executive officer, director or director nominee, or any other person. Our amended and restated memorandum and articles of association will provide that, if we wind up for any other reason prior to the consummation of our initial business combination, we will follow the foregoing procedures with respect to the liquidation of the trust account as promptly as reasonably possible but not more than ten business days thereafter, subject to applicable Cayman Islands law. Limited payments to insiders There will be no finder s fees, reimbursements or cash payments made by the company to our sponsor, officers TABLE OF CONTENTS or directors, or their affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination, other than the following payments, none of which will be made from the proceeds of this offering and the sale of the private placement warrants held in the trust account prior to the completion of our initial business combination: Repayment of up to an aggregate of $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; Reimbursement for office space, secretarial and administrative services provided to us by an affiliate of our sponsor, in the amount of $10,000 per month; Reimbursement for any out-of-pocket expenses related to identifying, investigating, negotiating and completing an initial business combination; Repayment of loans made in connection with extending the time to complete an initial business combination in an amount up to an aggregate of $2,000,000 (or up to $2,300,000 if the underwriter s over-allotment option is exercised in full) made by our sponsor or its affiliates or designees, if we extend the period of time to consummate an initial business combination by up to an additional three months. The loan will be convertible into additional private placement warrants at a price of $1.00 per warrant or repaid in cash upon the closing of our initial business combination (or any combination thereof) at the option of our sponsor; and Repayment of loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination. Up to $1,500,000 of such loans may be convertible into warrants of the post-business combination entity at a price of $1.00 per warrant at the option of the lender. The warrants would be identical to the private placement warrants. Except for the foregoing, the terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. Any such payments will be made either (i) prior to our initial business combination using proceeds of this offering and the sale of the private placement warrants held outside the trust account or from loans made to us by our sponsor or an affiliate of our sponsor or certain of our officers and directors or (ii) in connection with or after the consummation of our initial business combination. Audit Committee We will establish and maintain an audit committee, which will be composed entirely of independent directors. Among its responsibilities, the audit committee will review on a quarterly basis all payments that were made by us to our sponsor, officers or directors, or their affiliates and monitor compliance with TABLE OF CONTENTS the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to promptly take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled Management Committees of the Board of Directors Audit Committee. Indemnity Our sponsor has agreed that it will be liable to us if and to the extent any claims by a third-party for services rendered or products sold to us (other than our independent registered public accounting firm), or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amounts in the trust account to below the lesser of (i) $10.25 per public share and (ii) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account if less than $10.25 per public share due to reductions in the value of the trust assets, in each case net of the interest that may be withdrawn to pay our income tax obligations, provided that such liability will not apply to any claims by a third-party or prospective target business that executed a waiver of any and all rights to seek access to the trust account nor will it apply to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third-party, our sponsor will not be responsible to the extent of any liability for such third-party claims. However, we have not asked our sponsor to reserve for such indemnification obligations, nor have we independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and we believe that our sponsor s only assets are securities of our company. Therefore, we cannot assure you that our sponsor would be able to satisfy those obligations. None of our officers or directors will indemnify us for claims by third parties including, without limitation, claims by vendors and prospective target businesses. RISKS We are a recently incorporated company that has conducted no operations and has generated no revenues. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision whether to invest in our securities, you should take into account not only the background of our management team, but also the special risks we face as a blank check company. This offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see Proposed Business Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419. You should carefully consider these and the other risks set forth in the section entitled Risk Factors beginning on page 41 of this prospectus. TABLE OF CONTENTS Summary of Risk Factors An investment in our securities involves a high degree of risk. The occurrence of one or more of the events or circumstances described in the section titled Risk Factors, alone or in combination with other events or circumstances, may materially adversely affect our business, financial condition and operating results. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. Such risks include, but are not limited to: We are a recently incorporated company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. Past performance by our Team or their respective affiliates may not be indicative of future performance of an investment in us, and we may be unable to provide positive returns to shareholders. Our expectations regarding changes in the Sustainability industry may not materialize to the extent we expect, or at all. Our public shareholders may not be afforded an opportunity to vote on our proposed initial business combination, which means we may complete our initial business combination even though a majority of our public shareholders do not support such a combination. Your only opportunity to affect the investment decision regarding a potential business combination may be limited to the exercise of your right to redeem your shares from us for cash, unless we seek shareholder approval of such business combination. If we seek shareholder approval of our initial business combination, our sponsor and members of our management team have agreed to vote in favor of such initial business combination, regardless of how our public shareholders vote. The ability of our public shareholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combination with a target and may not allow us to complete the most desirable business combination or optimize our capital structure. The ability of our public shareholders to exercise redemption rights with respect to a large number of our shares may not allow us to complete the most desirable business combination or optimize our capital structure. The ability of our public shareholders to exercise redemption rights with respect to a large number of our shares could increase the probability that our initial business combination would be unsuccessful and that you would have to wait for liquidation in order to redeem your shares. The requirement that we consummate an initial business combination within 15 months (or up to 18 months if we extend the period of time to consummate a business combination) after the closing of this offering may give potential target businesses leverage over us in negotiating a business combination and may limit the time we have in which to conduct due diligence on potential business combination targets, in particular as we approach our dissolution deadline, which could undermine our ability to complete our initial business combination on terms that would produce value for our shareholders. Our search for a business combination, and any target business with which we ultimately consummate a business combination, may be materially adversely affected by the recent coronavirus (COVID-19) outbreak and the status of debt and equity markets. If we seek shareholder approval of our initial business combination, our sponsor, directors, executive officers, advisors or any of their affiliates may elect to purchase public shares, rights or warrants, which may influence a vote on a proposed business combination and reduce the public float of our securities. Because of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination. If we have not consummated our initial business combination within the required time period, our public TABLE OF CONTENTS shareholders may receive only approximately $10.25 per public share, or less in certain circumstances, on the liquidation of our trust account and our rights and warrants will expire worthless. If the net proceeds of this offering and the sale of the private placement warrants not being held in the trust account are insufficient to allow us to operate for the 15 months (or up to 18 months if we extend the period of time to consummate a business combination) following the closing of this offering, it could limit the amount available to fund our search for a target business or businesses and our ability to complete our initial business combination, and we will depend on loans from our sponsor, its affiliates or members of our management team to fund our search and to complete our initial business combination. As the number of special purpose acquisition companies evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets. This could increase the cost of our initial business combination and could even result in our inability to find a target or to consummate an initial business combination. Changes in the market for directors and officers liability insurance could make it more difficult and more expensive for us to negotiate and complete an initial business combination. If a shareholder fails to receive notice of our offer to redeem our public shares in connection with our initial business combination, or fails to comply with the procedures for tendering its shares, such shares may not be redeemed. You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. Therefore, to liquidate your investment, you may be forced to sell your public shares, rights or public warrants, potentially at a loss. Nasdaq may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities and subject us to additional trading restrictions. You will not be entitled to protections normally afforded to investors of many other blank check companies. Holders of Class A ordinary shares will not be entitled to vote on any appointment of directors we hold prior to our initial business combination. The public warrants may become exercisable and redeemable for a security other than the Class A ordinary shares, and you will not have any information regarding such other security at this time. The nominal purchase price paid by our sponsor for the founder shares may significantly dilute the implied value of your public shares in the event we consummate an initial business combination, and our sponsor is likely to make a substantial profit on its investment in us in the event we consummate an initial business combination, even if the business combination causes the trading price of our ordinary shares to decline materially. Unlike some other similarly structured blank check companies, our sponsor will receive additional Class A ordinary shares if we issue shares to consummate an initial business combination. We may reincorporate in another jurisdiction in connection with our initial business combination, and the laws of such jurisdiction may govern some or all of our future material agreements and we may not be able to enforce our legal rights. Because we are incorporated under the laws of the Cayman Islands, you may face difficulties in protecting your interests, and your ability to protect your rights through the U.S. federal courts may be limited. Provisions in our amended and restated memorandum and articles of association may inhibit a takeover of us, which could limit the price investors might be willing to pay in the future for our Class A ordinary shares and could entrench management. After our initial business combination, substantially all of our assets may be located in a foreign country and substantially all of our revenue may be derived from our operations in any such country. Accordingly, our results of operations and prospects will be subject, to a significant extent, to the economic, political and social conditions and government policies, developments and conditions in the country in which we operate. TABLE OF CONTENTS
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diff --git a/parsed_sections/prospectus_summary/2022/SWAGW_stran_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/SWAGW_stran_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/SWAGW_stran_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/SWIM_latham_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/SWIM_latham_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/SWIM_latham_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/SWVLW_swvl_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/SWVLW_swvl_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/SWVLW_swvl_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/TFLM_tofla_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/TFLM_tofla_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a3b2d1ac2ef7fac13200cae94c9efafdfc9add22
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/TFLM_tofla_prospectus_summary.txt
@@ -0,0 +1,96 @@
+PROSPECTUS SUMMARY 
+
+As used in this prospectus, unless the context
+otherwise requires, "we," "us," "our," and "Tofla Megaline" refers to Tofla Megaline Corporation.
+The following summary does not contain all of the information that may be important to you. You should read the entire prospectus before
+making an investment decision to purchase our common stock. 
+
+TOFLA MEGALINE
+
+Tofla Megaline was incorporated in the state
+of Nevada on August 31, 2018. We are a development stage Company and intend to commence operations in the business of software development
+for robotic devices.We plan to provide easy-to-use, high-quality and cost-effective automation AI solutions. 
+
+5
+
+Tofla Megaline will be focusing on both
+stand-alone and integrated solutions in order to cover a broader selection of services, especially in the surveillance area. Using
+autonomous robotic units as a means of surveillance is a new tendency all over the globe. Robotic units can be used for patrolling
+warehouses, malls, backyards, office areas and buildings etc. Our focus is going to be on developing specialized software for the
+units that will cover all the necessary functionality for surveillance and data transfer. We intend to engage in business activity,
+however, there is no assurance that we will be successful in developing our marketable product.
+
+We intend to use the net proceeds from this
+offering to develop our business operations (See "Description of Business" and "Use of Proceeds"). To implement
+our plan of operations we require a minimum of $37,500 for the next twelve months as described in our Plan of Operations. In the event
+we are unable to raise the minimum expected amount, we may have to scale back the business or cease our operations entirely. There is
+no assurance that we will generate any substantial revenue in the first 12 months after completion our offering or ever generate substantial
+revenue.
+
+Being a development stage Company, we have
+limited operating history. If we do not generate sufficient revenue, we may need a minimum of $10,000 of additional funding to pay for
+ongoing SEC filing requirements. We do not currently have any arrangements for additional financing. Our principal executive offices are
+located at Manzanillo 33. Local E, Mexico, Col. Roma Norte, 06700, Mexico. Our phone number is +525541607366.
+
+From inception (August 31, 2018) until the
+date of this filing, we have had limited operating activities and have reported no revenue. Our audited financial statements as of July
+31, 2021 reports an accumulated deficit of $3,079. As of April 30, 2022, the Company had an accumulated deficit of $26,468. Our independent
+registered public accounting firm has issued an audit opinion for Tofla Megaline which includes a statement expressing substantial doubt
+as to our ability to continue as a going concern. To date, we have established our Company, developed our business plan and currently
+we are working on a software development.
+
+As of the date of this prospectus, there is
+no public trading market for our common stock and no assurance that a trading market for our securities will ever develop.
+
+Proceeds from this offering are required for
+us to proceed with your business plan over the next twelve months. We require minimum funding of approximately $37,500 to conduct our
+proposed operations and pay all expenses for a minimum period of one year including expenses associated with this offering and maintaining
+a reporting status with the SEC. If we are unable to obtain minimum funding of approximately $37,500, our business may fail. We do not
+anticipate earning substantial revenues until we enter into commercial operation. Since we are presently in the development stage of our
+business, we can provide no assurance that we will successfully sell any products or services related to our planned activities.
+
+ 
+
+6
+
+ 
+
+THE OFFERING 
+
+ 
+ The Issuer: 
+ TOFLA MEGALINE 
+
+ 
+ Securities Being Offered: 
+ 5,000,000 shares of common stock. 
+
+ 
+ Price Per Share: 
+ $0.03 
+
+ 
+ Duration of the Offering: 
+ The shares will be offered for a period of three hundred and sixty-five (365) days from the effective date of this prospectus. The offering shall
+
+ 
+
+ 
+ 
+ terminate on the earlier of (i) when the offering period ends (365 days from the effective date of this prospectus), (ii) the date when the sale of all 5,000,000 shares is completed, (iii) when the Board of Directors decides that it is in the best interest of the Company to terminate the offering prior the completion of the sale of all 5,000,000 shares registered under the Registration Statement of which this Prospectus is part. 
+
+ 
+ Gross Proceeds 
+ $150,000 
+
+ 
+ Securities Issued and Outstanding: 
+ There are 4,500,000 shares of common stock issued and outstanding as of the date of this prospectus, held by our sole officer and director, Rodolfo Guerrero Angulo. If we are successful at selling all the shares in this offering, we will have 9,500,000 shares issued and outstanding. 
+
+ 
+ Subscriptions 
+ All subscriptions once accepted by us are irrevocable. 
+
+ 
+ Registration Costs 
+ We estimate our total offering registration costs to be approximately $12,000.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/TLSS_transporta_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/TLSS_transporta_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..819bac1a3973eefe80b037cf7973f61e88541129
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/TLSS_transporta_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 2
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/TOIIW_oncology_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/TOIIW_oncology_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..c9017c5066d796818bfebff795833e3742f62349
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/TOIIW_oncology_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights, and is qualified in its entirety by, the more detailed information and financial statements included elsewhere in this prospectus. This summary does not contain all of the information that may be important to you in making your investment decision. You should read this entire prospectus carefully, especially the Risk Factors section beginning on page 13 and our consolidated financial statements and the related notes appearing at the end of this prospectus, before deciding to invest in our Common Stock. Overview We are a value-based oncology company that manages community-based oncology practices that serve patients at 69 clinic locations across 13 markets and 5 states throughout the United States, which are staffed with 104 oncologists and advanced practice providers. As a value-based oncology company, TOI seeks to deliver both better quality care and lower cost of care. We believe that TOI has more covered lives than any other value-based oncology company. Background On August 9, 2022, the Company entered into the Facility Agreement providing for the issuance and sale by the Company to Deerfield Partners, as agent for itself and the lenders, of $110 million of aggregate principal amount of 4.0% of Convertible Notes upon the terms and conditions set forth in the Facility Agreement (the Deerfield Financing ). The Convertible Notes are secured by (i) a security interest in substantially all of the assets of the Company and its subsidiaries and (ii) a pledge by the Company of the equity interest of all its direct and indirect subsidiaries and will mature on August 9, 2027, unless earlier converted or redeemed, and are convertible into shares of the Company s Common Stock, par value $0.0001 per share at an initial conversion price of $8.567 per share, representing an approximately 30% premium over the Company s closing stock price of $6.59 per share on August 8, 2022. The Convertible Notes were issued in a private placement to the Selling Securityholders pursuant to an exemption for transactions by an issuer not involving a public offering under Section 4(a)(2) of the Securities Act. The Convertible Notes are convertible at any time at the option of the holders thereof; provided that the Selling Securityholders are prohibited from converting the Convertible Notes into shares of Common Stock if, upon such conversion, the converting holder (together with certain affiliates and group members) would beneficially own more than 4.9% of the total number of shares of Common Stock then issued and outstanding (the Beneficial Ownership Cap ). Holders of the Convertible Notes have the option to demand repayment of all outstanding principal, any unpaid interest accrued thereon, and make-whole interest in connection with a Major Transaction (as defined in the Convertible Notes) under the Convertible Notes, which includes, among other events, certain acquisitions or other changes of control of the Company; certain sales or transfers of assets of the Company; a liquidation, bankruptcy or other dissolution of the Company; or if at any time shares of the Company s Common Stock are not listed on an Eligible Market. The Convertible Notes are secured by (i) a security interest in substantially all of the assets of the Company and its subsidiaries and (ii) a pledge of the equity interests of the Company s direct and indirect subsidiaries. The Facility Agreement contains certain specified events of default, the occurrence of which would entitle the holders of the Convertible Notes to immediately demand repayment of all outstanding principal and accrued interest on the Convertible Notes, together with a make-whole payment as determined pursuant to the Facility Agreement. Such events of default include, among others, failure to make any payment under the Convertible Notes when due, failure to observe or perform any covenant under the Facility Agreement or the other transaction documents related thereto (subject in certain cases to specified cure periods), the failure of the Company to be able to pay debts as they come due, the commencement of bankruptcy or insolvency proceedings against the Company, a material judgment levied against the Company and a material default by the Company under other indebtedness. The Facility Agreement also provides for the issuance of the DF Warrants to purchase Common Stock to the extent that the obligations under Facility Agreement and the Convertible Notes are prepaid. If issued, the DF Warrants will be exercisable on a cash or cashless (net exercise) basis, and will be subject to the Beneficial Ownership Cap, as well as certain other customary anti-dilution adjustments upon the occurrence of certain events such as stock splits, subdivisions, reclassifications or combinations of Common Stock. The DF Warrants will also provide, at the election of each holder thereof, for the payment of the exercise price therefor by reduction of the principal amount of any outstanding Convertible Notes held by such holder. Upon the consummation of a Major Transaction (as defined in the DF Warrants) under the DF Warrants, which includes, among other events, certain acquisitions or other changes of control of the Company and certain sales or transfers of assets of the Company, holders of the DF Warrants may elect to (i) have their Warrants redeemed by the Company for an amount equal to the Black-Scholes value of such DF Warrant, in cash or, if applicable, in the form of the consideration paid to the Company s stockholders in a Major Transaction under the DF Warrants, or (ii) have such DF Warrants be assumed by the successor to the Company in a Major Transaction under the DF Warrants, if applicable. Holders of the DF Warrants are also entitled to participate in any dividends or distributions to holders of Common Stock at the time such dividends or distributions are paid to such stockholders. If issued, the DF Warrants and the shares of Common Stock issuable upon their exercise will be issued in a private placement pursuant to Section 4(a)(2) of the Securities Act in transactions not involving a public offering (or, in the case of the issuance of shares of common stock pursuant to certain non-cash exercises of the DF Warrants, pursuant to Section 3(a)(9) under the Securities Act as an exchange with existing security holders). In connection with the Facility Agreement, on August 9, 2022, the Company and the Selling Securityholders entered into a registration rights agreement (the DF Registration Rights Agreement ). Pursuant to the DF Registration Rights Agreement, the Company has agreed to prepare and file the registration statement of which this prospectus forms a part to effect a registration of the Common Stock issued or issuable upon conversion of or pursuant to the Convertible Notes or the DF Warrants (the Registrable Securities ), covering the resale of the Registrable Securities and such indeterminate number of additional shares of Common Stock as may become issuable upon conversion of or otherwise pursuant to the Convertible Notes to prevent dilution resulting from certain corporate actions. The DF Registration Rights Agreement also provides for piggy-back registration, subject to the terms and conditions of the DF Registration Rights Agreement. In connection with the Company s entry into the DF Registration Rights Agreement, certain TOI Legacy stockholders, representing the majority holders as required under Section 2(h) of the Existing Registration Rights Agreement, entered into a Registration Rights Agreement Waiver, Amendment, and Consent (the RRA Waiver ). The RRA Waiver provides written consent to permit the Company to enter into the DF Registration Rights Agreement, waives certain piggyback rights provided under the Existing Registration Rights Agreement, and agrees to amend the Existing Registration Rights Agreement to update a defined term. The rights of holders of our Common Stock, Warrants, and Convertible Notes are governed by our Charter and our Bylaws, and the DGCL, and, in the case of the Warrants, the Warrant Agreement. See the section entitled Description of Capital Stock. Summary Risk Factors The following is a summary of select risks and uncertainties that could materially adversely affect us, our business, financial condition and results of operations. You should read this summary together with the full and complete discussion of risk factors contained below: The Facility Agreement and the associated restrictive covenants thereunder could adversely affect our financial condition and will restrict our ability to raise capital. The terms of the Convertible Note may have a negative impact on our business and the value of our securities and may result in substantial dilution to our other equity securityholders. Our growth strategy depends on our ability to build or acquire new clinics to service our contracts and treat our patients. We have experienced, and may continue to experience, rapid growth and organizational change, which has placed, and may continue to place, significant demands on our management and our operational and financial resources. We have identified material weaknesses in our internal control over financial reporting that, if not properly corrected, could materially adversely affect our operations and result in material misstatements in our financial statements. Failure to establish and maintain effective internal controls in accordance with Section 404 of the Sarbanes-Oxley Act could have a material adverse effect on our business and stock price We have a history of net losses, we anticipate increasing expenses in the future, and we may not be able to achieve or maintain profitability. Our services are concentrated in certain geographic areas and populations exposing us to unfavorable changes in local benefit costs, reimbursement rates, competition and economic conditions. If we are unable to attract new patients, our revenue growth will be adversely affected. We primarily depend on reimbursement from third-party payors, as well as payments by individuals, which could lead to delays, denials, or uncertainties in the reimbursement process. With many of our value-based agreements, our consolidating professional corporations ( TOI PCs ) assume the risk that the cost of providing services will exceed our compensation. As oncology costs rise, if we do not accurately predict the cost to deliver care, some of the TOI PCs value-based agreements could become less profitable, or unprofitable. A significant portion of our consolidated Patient Services revenue is derived from a limited number of health insurance, Independent Practice Associations, or IPAs and medical group companies. Those payors could take action to remove, exclude, delay, or otherwise prevent the inclusion of the TOI PCs in their provider networks. A significant portion of sales are from prescription drug sales reimbursed by a limited number of pharmacy benefit management companies with which TOI PCs contract. Those pharmacy benefit management companies could take action to remove, exclude, delay or otherwise prevent the inclusion of the TOI PCs in their provider networks. Reductions in Medicare reimbursement rates or changes in the rules governing the Medicare program could have a material adverse effect on our financial condition and results of operations The transition from volume to value-based reimbursement models may have a material adverse effect on our operations. If certain of our suppliers do not meet our needs, if there are material price increases on supplies, if we are not reimbursed or adequately reimbursed for drugs we purchase or if we are unable to effectively access new technology or superior products, it could negatively impact our ability to effectively provide the services we offer and could have a material adverse effect on our business, results of operations, financial condition and cash flows. We depend on our information technology systems, and those of our third-party vendors, contractors and consultants, and any failure or significant disruptions of these systems, security breaches or loss of data could materially adversely affect our business, financial condition and results of operations. Some jurisdictions preclude the TOI PCs from entering into non-compete agreements with our physicians, and other non-compete agreements and restrictive covenants applicable to certain physicians and other clinical employees may not be enforceable. We are dependent on our relationships with the TOI PCs, which are affiliated professional entities that we do not own, to provide healthcare services, and our business would be harmed if those relationships were disrupted or if our arrangements with the TOI PCs become subject to legal challenges. If there is a change in accounting standards by the Financial Accounting Standards Board or the interpretation thereof affecting consolidation of entities, it could have a material adverse effect on our consolidation of total revenues derived from the TOI PCs. We are subject to extensive fraud, waste, and abuse laws that may give rise to federal and state audits, investigations, lawsuits and claims against us, the outcome of which may have a material adverse effect on our business, financial condition, cash flows, or results of operations. If any of our managed clinics or TOI PCs lose their regulatory licenses, permits and/or accreditation status, or become ineligible to receive reimbursement under Medicare or Medicaid or other third-party payors, there may be a material adverse effect on our business, financial conditions, cash flows or results of operations. Future changes to applicable tax laws and regulations and/or their interpretations may have an adverse effect on our business, financial condition and results of operations. Tax rules and regulations are subject to interpretation and require judgment by us that may be successfully challenged by the applicable taxation authorities upon audit, which could result in additional tax liabilities. Our Corporate Information We were incorporated as a Delaware corporation in November 2019 for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. Upon the closing of the Business Combination we changed our name to The Oncology Institute, Inc. Our principal executive offices are located at 18000 Studebaker Rd, Suite 800, Cerritos, California 90703, and our telephone number is (562) 735-3226. Our website address is https://www.theoncologyinstitute.com. The information contained in, or accessible through, our website does not constitute a part of this prospectus. We have included our website address in this prospectus solely as an inactive textual reference. Emerging Growth Company We qualify as an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 ( JOBS Act ). An emerging growth company may take advantage of specified reduced reporting requirements that are otherwise generally applicable to public companies. These reduced reporting requirements include: an exemption from compliance with the auditor attestation requirement on the effectiveness of our internal control over financial reporting; reduced disclosure about our executive compensation arrangements; an exemption from the requirements to obtain a non-binding advisory vote on executive compensation or a stockholder approval of any golden parachute arrangements; and extended transition periods for complying with new or revised accounting standards. We may take advantage of these exemptions until the last day of our fiscal year following the fifth anniversary of the completion of this offering or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company if we have more than $1.07 billion in annual revenue, we are deemed to be a large accelerated filer under the rules of the SEC or we issue more than $1.0 billion of non-convertible debt over a three-year period. We may choose to take advantage of some, but not all, of the available exemptions. We have taken advantage of certain reduced reporting burdens in this prospectus. Accordingly, the information contained herein may be different than the information you receive from other public companies in which you hold stock. The JOBS Act permits an emerging growth company like us to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies. We have elected to use this extended transition period until we are no longer an emerging growth company or until we affirmatively and irrevocably opt out of the extended transition period. As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates. 10.7Amended and Restated Management Services Agreement, dated January 12, 2021, by and between TOI Management, LLC and The Oncology Institute CA, as amended 8-K/A001-3924810.6November 22, 2021 10.8TOI Parent, Inc. 2019 Non-Qualified Stock Option Plan 8-K/A001-3924810.7November 22, 2021 10.9Separation Agreement by and between the Company and Scott Dalgleish 10-Q001-3924810.1August 9, 2022 10.10Executive Employment Agreement- Mihir Shah 10-Q001-3924810.1May 10, 2022 10.11Facility Agreement, dated as of August 9, 2022, by and among the Company and Deerfield Partners L.P. 8-K001-3924810.1August 10, 2022 10.12Registration Rights Agreement, dated as of August 9, 2022, by and among The Oncology Institute, Inc. and Deerfield Partners LP 8-K001-3924810.2August 10, 2022 10.13Registration Rights Consent, Amendment, and Waiver, dated as of August 9, 2022, by and among Deerfield Private Design Fund IV, L.P., Deerfield Partners, L.P., M33 Growth I L.P., TOI M, LLC, and Oncology Care Partners, LLC. 8-K001-3924810.3August 10, 2022 21.1Subsidiaries of the registrant S-1333-26174021.1December 17, 2021 23.1Consent of BDO USA, LLP (with respect to The Oncology Institute, Inc. consolidated financial statements) S-1333-26732423.1September 8, 2022 23.2Consent of Latham & Watkins (included as part of Exhibit 5.1) S-1333-26732423.2September 8, 2022 24.1Power of Attorney (included on the signature page of this Registration Statement) We have elected to take advantage of certain of the reduced disclosure obligations in the registration statement of which this prospectus is a part and may elect to take advantage of other reduced reporting requirements in future filings. As a result, the information that we provide to our stockholders may be different than you might receive from other public reporting companies in which you hold equity interests. In addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. We have elected to use the extended transition period for complying with new or revised accounting standards. As a result of this election, our financial statements may not be comparable to companies that comply with public company effective dates.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/TOPS_top-ships_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/TOPS_top-ships_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..75048fb638ac19c5de7a1ab35c48d53720dd70da
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/TOPS_top-ships_prospectus_summary.txt
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+PROSPECTUS SUMMARY This section summarizes certain of the information that appears elsewhere in this prospectus or in the documents incorporated by reference herein and is qualified in its entirety by the more detailed information, including the financial statements that appear in the documents incorporated by reference. This summary may not contain all of the information that may be important to you. As an investor or prospective investor, you should review carefully the entire prospectus, including the risk factors, and the more detailed information that is included herein and in the documents incorporated by reference herein. Unless the context otherwise requires, as used in this prospectus, the terms Company, we, us, and our refer to TOP Ships Inc. and all of its subsidiaries. We use the term deadweight ton, or dwt, in describing the size of vessels. Dwt, expressed in metric tons each of which is equivalent to 1,000 kilograms, refers to the maximum weight of cargo and supplies that a vessel can carry. Our reporting currency is in the U.S. dollar and all references in this prospectus to $ or dollars are to U.S. dollars. Further, unless otherwise indicated, the information presented in this prospectus gives effect to the following reverse stock splits of our issued and outstanding common shares: a one-for-twenty reverse stock split of our issued and outstanding common shares effective on August 22, 2019, a one-for-twenty-five reverse stock split of our issued and outstanding common shares effective on August 10, 2020 and a one-for-twenty reverse stock split of our issued and outstanding common shares effective on September 23, 2022. Our Company We are an international owner and operator of modern, fuel efficient eco tanker vessels focusing on the transportation of crude oil, petroleum products (clean and dirty) and bulk liquid chemicals. Our operating fleet has a total capacity of 1,435,000 deadweight tonnes ( dwt ). As of the date of this prospectus, our fleet consists of one 50,000 dwt product/chemical tanker, the M/T Eco Marina Del Ray, five 157,000 dwt Suezmax tankers, the M/T Eco Oceano CA, the M/T Eco Malibu, the M/T Eco West Coast, the M/T Eco Bel Air and the M/T Eco Beverly Hills, two 300,000 dwt Very Large Crude Carriers ( VLCCs ), M/T Julius Caesar and M/T Legio X Equestris, and we also own 50% interests in two 50,000 dwt product/chemical tankers, M/T Eco Yosemite Park and the M/T Eco Joshua Park. All of our vessels are certified by the International Maritime Organization, the United Nations agency for maritime safety and the prevention of pollution by vessels (the IMO ) and are capable of carrying a wide variety of oil products including chemical cargos, which we believe make our vessels attractive to a wide base of charterers. Our Fleet The following tables present our fleet list as of the date of this prospectus: Operating MR Tanker Vessels on sale and leaseback financing agreements ( SLBs ) (treated as financings): Name Deadweight Charterer End of firm period Charterer s Optional Periods Gross Rate fixed period/ options M/T Eco Marina Del Ray 50,000 Cargill March 2024 none $15,100 Operating Suezmax Vessels on SLBs (treated as operating leases): Name Deadweight Charterer End of firm period Charterer s Optional Periods Gross Rate fixed period/ options M/T Eco Bel Air 157,000 Trafigura March 2024 9 months $24,000 / $24,000 M/T Eco Beverly Hills 157,000 Trafigura May 2024 7 months $24,000 / $24,000 Table of Contets Operating Suezmax Vessels on SLBs (treated as financings): Name Deadweight Charterer End of firm period Charterer s Optional Periods Gross Rate fixed period/ options M/T Eco Oceano CA 157,000 Central Tankers Chartering Inc. March 2037 none $24,500 Operating Suezmax Vessels financed via senior loan facilities: Name Deadweight Charterer End of firm period Charterer s Optional Periods Gross Rate fixed period/ options M/T Eco West Coast 157,000 Clearlake March 2024 1+1 years $33,950 / $34,750 / $36,750 M/T Eco Malibu 157,000 Clearlake May 2024 1+1 years $33,950 / $34,750 / $36,750 Operating VLCC Vessels on SLBs (treated as financings): Name Deadweight Charterer End of firm period Charterer s Optional Periods Gross Rate fixed period/ options M/T Julius Caesar 300,000 Trafigura January 2025 1+1 years $36,000 / $39,000 / $41,500 M/T Legio X Equestris 300,000 Trafigura February 2025 1+1 years $35,750 / $39,000 / $41,500 Operating Joint Venture MR Tanker fleet (50% owned): Name Deadweight Charterer End of firm period Charterer s Optional Periods Gross Rate fixed period/ options M/T Eco Yosemite Park 50,000 Clearlake March 2025 5+1+1 years $17,400 / $18,650 / $19,900 M/T Eco Joshua Park 50,000 Clearlake March 2025 5+1+1 years $17,400 / $18,650 / $19,900 All the vessels in our fleet are equipped with engines of modern design with improved Specific Fuel Oil Consumption ( SFOC ) and in compliance with the latest emission requirements, fitted with energy saving improvements in the hull, propellers and rudder as well as equipment that further reduces fuel consumption and emissions certified with an improved Energy Efficiency Design Index (Phase 2 compliance level as minimum). Vessels with this combination of technologies, introduced from certain shipyards, are commonly referred to as eco vessels. We believe that recent advances in shipbuilding design and technology makes these latest generation vessels more fuel-efficient than older vessels in the global fleet that compete with our vessels for charters, providing us with a competitive advantage. Furthermore, all of our vessels are fitted with ballast water treatment equipment and exhaust gas cleaning systems (scrubbers). We believe we have established a reputation in the international ocean transport industry for operating and maintaining vessels with high standards of performance, reliability and safety. We have assembled a management team comprised of executives who have extensive experience operating large and diversified fleets of tankers and who have strong ties to a number of national, regional and international oil companies, charterers and traders. Table of Contets Summary of Risk Factors The international tanker industry has historically been both cyclical and volatile and this may lead to reductions and volatility in our charter rates, our vessel values, our revenues, earnings and cash flow results. Our financial results may be adversely affected by the ongoing outbreak of COVID-19, and the related governmental responses thereto. Outbreaks of epidemic and pandemic diseases and governmental responses thereto could adversely affect our business. The international oil tanker industry has experienced volatile charter rates and vessel values and there can be no assurance that these charter rates and vessel values will not decrease in the near future. Volatile economic conditions throughout the world could have an adverse impact on our operations and financial results. The current state of the global financial markets and current economic conditions may adversely impact our results of operation, financial condition, cash flows and ability to obtain financing or refinance our existing and future credit facilities on acceptable terms, which may negatively impact our business. Volatility of LIBOR and potential changes of the use of LIBOR as a benchmark could affect our profitability, earnings and cash flow. We are subject to complex laws and regulations, including environmental regulations that can adversely affect the cost, manner or feasibility of doing business. We are subject to international safety regulations and requirements imposed by classification societies and the failure to comply with these regulations may subject us to increased liability, may adversely affect our insurance coverage and may result in a denial of access to, or detention in, certain ports. Climate change and greenhouse gas restrictions may adversely impact our operations and markets. Our vessels may suffer damage due to the inherent operational risks of the tanker industry and we may experience unexpected dry-docking costs, which may adversely affect our business and financial condition. The market value of our vessels, and those we may acquire in the future, may fluctuate significantly, which could cause us to incur losses if we decide to sell them following a decline in their market values or we may be required to write down their carrying value, which will adversely affect our earnings. An over-supply of tanker capacity may lead to reductions in charter hire rates and profitability. If our vessels call on ports located in countries or territories that are the subject of sanctions or embargoes imposed by the U.S. government or other governmental authorities, it could lead to monetary fines or adversely affect our business, reputation and the market for our common shares. Political instability, terrorist or other attacks, war, international hostilities and public health threats can affect the tanker industry, which may adversely affect our business. The U.K. s withdrawal from the European Union may have a negative effect on global economic conditions, financial markets and our business. Acts of piracy on ocean-going vessels could adversely affect our business. An economic slowdown or changes in the economic and political environment in the Asia Pacific region could have a material adverse effect on our business, financial condition and results of operations. Increased inspection procedures and tighter import and export controls could increase costs and disrupt our business. We rely on our information systems to conduct our business, and failure to protect these systems against security breaches could adversely affect our business and results of operations. Additionally, if these systems fail or become unavailable for any significant period of time, our business could be harmed. Our financing facilities contain restrictive covenants that may limit our liquidity and corporate activities, and could have an adverse effect on our financial condition and results of operations. Servicing current and future debt, including financings committed under sale and leaseback ( SLB ) agreements, will limit funds available for other purposes and impair our ability to react to changes in our business. Our President, Chief Executive Officer and Director has significant influence over us, and a trust established for the benefit of his family may be deemed to beneficially own, directly or indirectly, 100% of our Series D and our Series E Preferred Shares, and an affiliate of his may be deemed to beneficially own 100% our Series F Preferred Shares, and thereby to control the outcome of matters on which our shareholders are entitled to vote. We have been subject to litigation in the past and we may be subject to similar or other litigation in the future. As of the date of this prospectus our operating fleet consists of eight tankers. Any limitation in the availability or operation of these vessels could have a material adverse effect on our business, results of operations and financial condition. We expect to be dependent on a limited number of customers for a large part of our revenues, and failure of such counterparties to meet their obligations could cause us to suffer losses or negatively impact our results of operations and cash flows. If we fail to manage our planned growth properly, we may not be able to successfully expand our market share. Delays or defaults by the shipyards in the construction of newbuildings could increase our expenses and diminish our net income and cash flows. Our ability to obtain additional debt financing may be dependent on our ability to charter our vessels, the performance of our charters and the creditworthiness of our charterers. The industry for the operation of tanker vessels and the transportation of oil, petroleum products and chemicals is highly competitive and we may not be able to compete for charters with new entrants or established companies with greater resources. A limited number of financial institutions hold our cash. We may be unable to attract and retain key management personnel and other employees in the international tanker shipping industry, which may negatively impact the effectiveness of our management and our results of operations. If labor interruptions are not resolved in a timely manner, they could have a material adverse effect on our business, results of operations, cash flows, financial condition and available cash. If we expand our business, we will need to improve our operations and financial systems and staff; if we cannot improve these systems or recruit suitable employees, our performance may be adversely affected. A drop in spot charter rates may provide an incentive for some charterers to default on their charters, which could affect our cash flow and financial condition. An increase in operating costs could decrease earnings and available cash. The aging of our fleet may result in increased operating costs in the future, which could adversely affect our earnings. Unless we set aside reserves or are able to borrow funds for vessel replacement, our revenue will decline at the end of a vessel s useful life, which would adversely affect our business, results of operations and financial condition. Purchasing and operating secondhand vessels may result in increased operating costs and vessels off-hire, which could adversely affect our earnings. We may not have adequate insurance to compensate us if we lose any vessels that we acquire. Table of Contets We may be subject to increased premium payments, or calls, as we obtain some of our insurance through protection and indemnity associations. Increasing scrutiny and changing expectations from investors, lenders and other market participants with respect to our Environmental, Social and Governance ( ESG ) policies may impose additional costs on us or expose us to additional risks. Technological innovation and quality and efficiency requirements from our customers could reduce our charter hire income and the value of our vessels. The smuggling of drugs or other contraband onto our vessels may lead to governmental claims against us. Maritime claimants could arrest our vessels or vessels we acquire, which could interrupt our cash flow. Governments could requisition our vessels or vessels we acquire during a period of war or emergency, resulting in loss of earnings. U.S. federal tax authorities could treat us as a passive foreign investment company, which could have adverse U.S. federal income tax consequences to U.S. shareholders. We are subject to U.S. federal income tax on our U.S. source income, which will reduce our earnings. We are a foreign private issuer, which could make our common shares less attractive to some investors or otherwise harm our stock price. The market price and trading volume of our common shares may continue to be highly volatile, which could lead to a loss of all or part of a shareholder s investment. There is no guarantee of a continuing public market for you to resell our common shares. Nasdaq may delist our common shares from its exchange which could limit your ability to make transactions in our securities and subject us to additional trading restrictions. Our management team will have broad discretion over the use of the net proceeds from this offering. We issued common shares in the past through various transactions, and we may do so in the future without shareholder approval, which may dilute our existing shareholders, depress the trading price of our securities and impair our ability to raise capital through subsequent equity offerings. Future issuances or sales, or the potential for future issuances or sales, of our common shares may cause the trading price of our securities to decline and could impair our ability to raise capital through subsequent equity offerings. The issuance of common shares in this offering may trigger anti-dilution provisions in our Series E Preferred Shares and affect the interests of our common shareholders. Anti-takeover provisions in our organizational documents could have the effect of discouraging, delaying or preventing a merger or acquisition, which could reduce the market price of our common shares. We are incorporated in the Republic of the Marshall Islands, which does not have a well-developed body of corporate law and as a result, shareholders may have fewer rights and protections under Marshall Islands law than under a typical jurisdiction in the United States. It may not be possible for investors to serve process on or enforce U.S. judgments against us. Our By-laws provide that the High Court of the Republic of Marshall Islands shall be the sole and exclusive forum for certain disputes between us and our shareholders, which could limit our shareholders ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or employees. We may not achieve the intended benefits of having a forum selection provision if it is found to be unenforceable. We are dependent on our Fleet Manager to perform the day-to-day management of our fleet. Our Fleet Manager is a privately held company and there may be limited or no publicly available information about it. Our Fleet Manager may have conflicts of interest between us and its other clients. Recent Developments On May 20, 2022, we announced that we have received written notification from The Nasdaq Stock Market, dated May 18, 2022, indicating that because our common share closing bid price for the last 30 consecutive business days was below $1.00 per share, we no longer met the minimum bid price requirement for the Nasdaq Capital Market as set forth in Nasdaq Listing Rule 5450(a)(1). On September 23, 2022 we effectuated a one-for-twenty reverse stock split in order to regain compliance with Nasdaq Listing Rule 5450(a)(1). As a result, we regained compliance on October 7, 2022. On June 3, 2022, we entered into a securities purchase agreement with a single unaffiliated institutional investor to purchase approximately $7.2 million of our common shares (or pre-funded warrants in lieu thereof) in a registered direct offering and warrants to purchase common shares in a concurrent private placement. On June 7, 2022, we issued 235,000 of our common shares and 480,150 pre-funded warrants in the registered direct offering, and 14,303,000 warrants (the June 2022 Warrants ) to purchase 715,150 common shares in the concurrent private placement for a purchase price of $10.00 per common share and June 2022 Warrant and $9.9980 per pre-funded warrant and June 2022 Warrant. The June 2022 Warrants were immediately exercisable, with an expiration date of five years from the date of issuance and had an exercise price of $10.00 per common share. Maxim Group LLC acted as the sole placement agent in connection with the offering. In July 2022, 5,229,000 pre-funded warrants were exercised for 261,450 common shares, and in September 2022, 4,374,000 pre-funded warrants were exercised for 218,700 common shares. On July 8, 2022, we redeemed 865,558 of our Series F Preferred Shares for an aggregate amount of approximately $10.4 million, payable in cash. On September 5, 2022, we held our annual meeting of shareholders. At this annual meeting of shareholders, the shareholders of the Company approved and adopted the following three proposals: 1. the election of Alexandros Tsirikos as Class III Director to serve until the 2025 Annual Meeting of Shareholders; 2. the ratification of Deloitte Certified Public Accountants S.A. as the Company s independent auditors for the fiscal year ending December 31, 2022; and 3. the approval of one or more amendments to the Company s Amended and Restated Articles of Incorporation to effect one or more reverse stock splits of the Company s issued common shares at a ratio of not less than one-for-two and not more than one-for-250 and in the aggregate at a ratio of not more than one-for-250, inclusive, with the Company s board of directors (the Board ) having the discretion as to whether or not one or more reverse stock splits is to be effected at any time prior to December 31, 2023, with the exact ratio to be set at a whole number within this range to be determined by the Board, or any duly constituted committee thereof, at any time after approval of each amendment in its discretion, and to authorize the Board to implement any such reverse stock split by filing any such amendment with the Registrar of Corporations of the Republic of the Marshall Islands. On September 23, 2022, we effectuated a one-for-twenty reverse stock split of our common shares. There was no change in the number of our authorized common shares. All numbers of common share and earnings per share amounts, as well as warrant shares eligible for purchase under our warrants, exercise price of said warrants and conversion prices of our Series E Shares in this report, not including amounts incorporated by reference, have been retroactively adjusted to reflect this reverse stock split. On October 10, 2022, we entered into a warrant exercise inducement letter agreement ( Inducement Letter ) with an accredited investor that was an existing holder of June 2022 Warrants, wherein the investor agreed to exercise all of the June 2022 Warrants at an exercise price reduced from $10.00 per share to $6.75 per share, in consideration for the issuance of new warrants (the October 2022 Warrants ) to purchase up to an aggregate of 1,072,725 common shares for a purchase price of $6.75 per common share. The October 2022 Warrants were immediately exercisable upon issuance at an exercise price of $6.75 per common share and will expire on June 7, 2027. The net proceeds of the exercise of the June 2022 Warrants to the Company, after deducting estimated expenses and fees, was approximately $4.5 million. We granted customary registration rights covering the resale of the common shares issuable upon exercise of the October 2022 Warrants. As of the date of this prospectus there are no pre-funded warrants outstanding, no June 2022 Warrants outstanding and 1,072,725 October 2022 Warrants outstanding. Corporate Information Our predecessor, Ocean Holdings Inc., was formed as a corporation in January 2000 under the laws of the Republic of the Marshall Islands and renamed Top Tankers Inc. in May 2004. In December 2007, Top Tankers Inc. was renamed TOP Ships Inc. Our common shares are currently listed on the Nasdaq Capital Market under the symbol TOPS. The current address of our principal executive office is 1 Vasilisis Sofias and Megalou Alexandrou Str, 15124 Maroussi, Greece. The telephone number of our principal executive office is +30 210 812 8127. Our corporate website address is www.topships.org. The information contained on our website does not constitute part of this prospectus. The Commission maintains a website that contains reports, proxy and information statements, and other information that we file electronically at www.sec.gov. Table of Contets
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+PROSPECTUS SUMMARY 1 THE OFFERING 15 RISK FACTORS 16 ENFORCEABILITY OF CIVIL LIABILITIES 41 USE OF PROCEEDS 42 DIVIDEND POLICY 43 CAPITALIZATION 44 DILUTION 45 MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 46 OUR INDUSTRY 68 BUSINESS 73 REGULATION 91 MANAGEMENT 98 PRINCIPAL SHAREHOLDERS 103 RELATED PARTY TRANSACTIONS 104 DESCRIPTION OF SHARE CAPITAL 105 SHARES ELIGIBLE FOR FUTURE SALE 115 TAXATION 116 UNDERWRITING 119 EXPENSES RELATING TO THIS OFFERING 124 LEGAL MATTERS 125 EXPERTS 125 WHERE YOU CAN FIND ADDITIONAL INFORMATION 125 INDEX TO FINANCIAL STATEMENTS F-1 i Neither we nor any of the underwriters have authorized anyone to provide you with any information or to make any representations other than as contained in this prospectus or in any free writing prospectuses we have prepared. Neither we nor the underwriters take responsibility for, and provide no assurance about the reliability of, any information that others may give you. This prospectus is an offer to sell only the securities offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or any sale of the securities. Our business, financial condition, results of operations and prospects may have changed since that date. No action is being taken in any jurisdiction outside the U.S. to permit a public offering of our securities or possession or distribution of this prospectus in any such jurisdiction. Persons who come into possession of this prospectus in jurisdictions outside the U.S. are required to inform themselves about and to observe any restrictions about this offering and the distribution of this prospectus applicable to those jurisdictions. Through and including ________, 2022 (the 25th day after the date of this prospectus), all dealers effecting transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to a dealer s obligation to deliver a prospectus when acting as an underwriter and with respect to an unsold allotment or subscription. We obtained statistical data, market data and other industry data and forecasts used in this prospectus from market research, publicly available information and industry publications. While we believe that the statistical data, industry data and forecasts and market research are reliable, we have not independently verified the data. ii Conventions Which Apply to this Prospectus Unless we indicate otherwise, all information in this prospectus assumes no exercise by the underwriters of their over-allotment option to purchase up to 750,000 additional Ordinary Shares from us. Except where the context otherwise requires and for purposes of this prospectus only the term: "Asian investors" refers to the Asian population around the globe. "China" or "PRC" refers to the People s Republic of China, excluding, for the purpose of this prospectus only, Taiwan; "Controlling Shareholder" refers to Zhong Yang Holdings (BVI) Limited; "HK$" or "Hong Kong dollars" refers to the legal currency of Hong Kong; "HKSFC" refers to the Securities and Futures Commission of Hong Kong; "HKSFO" refers to the Securities and Futures Ordinance (Cap. 571) of Honk Kong; "Hong Kong" refers to Hong Kong Special Administrative Region of the People s Republic of China; "Ordinary Shares" refers to the Company s ordinary shares, par value US$0.001 per share; "Operating Subsidiaries" refers to WIN100 TECH, ZYCL and ZYSL; "Predecessor Parent Company" or "ZYHL" refers to Zhong Yang Holdings Limited, a company with limited liability under the laws of Hong Kong. "SEC" refers to the United States Securities and Exchange Commission; "SEHK" refers to the Stock Exchange of Hong Kong Limited; "US$" or "U.S. dollars" refers to the legal currency of the United States; "WIN100 TECH" refers to WIN100 TECH Limited, a company incorporated under the laws of British Virgin Islands. "ZYAL BVI" refers to ZYAL (BVI) Limited, a company incorporated under the laws of British Virgin Islands. "ZYCL" refers to Zhong Yang Capital Limited, a company with limited liability under the laws of Hong Kong. "ZYCL BVI" refers to ZYCL (BVI) Limited, a company incorporated under the laws of British Virgin Islands. "ZYFGL", the "Company", "we," "us," "or "our" refers to Zhong Yang Financial Group Limited, a Cayman Islands exempted company, and, in the context of describing its operation and business, its subsidiaries. "ZYNL BVI" refers to ZYNL (BVI) Limited, a company incorporated under the laws of British Virgin Islands. "ZYSL" refers to Zhong Yang Securities Limited, a company with limited liability under the laws of Hong Kong. "ZYSL BVI" refers to ZYSL (BVI) Limited, a company incorporated under the laws of British Virgin Islands. "ZYTL BVI" refers to ZYTL (BVI) Limited, a company incorporated under the laws of British Virgin Islands. ZYFGL is a holding company with operations conducted in Hong Kong through its operating subsidiaries in Hong Kong, using Hong Kong dollars. The reporting currency is U.S. dollars. Assets and liabilities denominated in foreign currencies are translated at year-end exchange rates, income statement accounts are translated at average rates of exchange for the year and equity is translated at historical exchange rates. Any translation gains or losses are recorded in other comprehensive income (loss). Gains or losses resulting from foreign currency transactions are included in net income. The conversion of Hong Kong dollars into U.S. dollars are based on the exchange rates set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System. Unless otherwise noted, all translations from Hong Kong dollars to U.S. dollars and from U.S. dollars to Hong Kong dollars in this prospectus were made at a year-end spot rate of HK$7.7746 to US$1.00 or an average rate of HK$7.7526 to US$1.00. On March 31, 2020, the year-end spot rate and average rate for Hong Kong dollars were, respectively, HK$7.7513 to US$1.00 and HK$7.8167 to US$1.00. On September 30, 2021, the period-end exchange rate and average rate for Hong Kong dollars were, HK$7.7850 to US$1.00 and HK$7.7718 to US$1.00, respectively. iii DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS This prospectus contains forward-looking statements that reflect our current expectations and views of future events, all of which are subject to risks and uncertainties. Forward-looking statements give our current expectations or forecasts of future events. You can identify these statements by the fact that they do not relate strictly to historical or current facts. You can find many (but not all) of these statements by the use of words such as "approximates," "believes," "hopes," "expects," "anticipates," "estimates," "projects," "intends," "plans," "will," "would," "should," "could," "may" or other similar expressions in this prospectus. These statements are likely to address our growth strategy, financial results and product and development programs. You must carefully consider any such statements and should understand that many factors could cause actual results to differ from our forward-looking statements. These factors may include inaccurate assumptions and a broad variety of other risks and uncertainties, including some that are known and some that are not. No forward-looking statement can be guaranteed and actual future results may vary materially. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to: our goals and strategies; our future business development, financial condition and results of operations; introduction of new product and service offerings; expected changes in our revenues, costs or expenditures; our expectations regarding the demand for and market acceptance of our products and services; expected growth of our customers, including consolidated account customers; competition in our industry; government policies and regulations relating to our industry; and uncertainty about the spread of the COVID-19 virus and the impact it may have on the Company s operations, the demand for the Company s products and services, and economic activity in general; and We describe certain material risks, uncertainties, and assumptions that could affect our business, including our financial condition and results of operations, under "Risk Factors." We base our forward-looking statements on our management s beliefs and assumptions based on information available to our management at the time the statements are made. We caution you that actual outcomes and results may, and are likely to, differ materially from what is expressed, implied or forecast by our forward-looking statements. Accordingly, you should be careful about relying on any forward-looking statements. Except as required under the federal securities laws, we do not have any intention or obligation to update publicly any forward-looking statements after the distribution of this prospectus, whether as a result of new information, future events, changes in assumptions, or otherwise. iv PROSPECTUS SUMMARY The following summary is qualified in its entirety by, and should be read in conjunction with, the more detailed information and financial statements included elsewhere in this prospectus. In addition to this summary, we urge you to read the entire prospectus carefully, especially the risks of investing in our Ordinary Shares, discussed under "Risk Factors," before deciding whether to buy our Ordinary Shares. Our Mission Our goal is to become the preferred online trading platforms for Asian investors worldwide. Overview ZYFGL is a holding company incorporated in the Cayman Islands with operations conducted in Hong Kong by its Operating Subsidiaries, ZYSL and ZYCL, both incorporated in Hong Kong, and WIN100 TECH, incorporated in the British Virgin Islands. We are an online brokerage firm located in Hong Kong specializing in the trading of local and foreign equities, futures, and options products. We create value for our customers by providing reliable trading platforms, user-friendly web and app interface, and seamless customer support. Our Operating Subsidiaries generate revenues primarily by charging commission fees on futures transactions at a flat rate for each futures transaction contract. Currently our customers are mainly high volume and frequency trading institutional and individual investors. Our clients primarily reside in Asia and we are currently focusing on expanding our customer base to Southeast Asian investors. Our trading platforms, which our Operating Subsidiaries license from third parties, enable investors to place trades on more than 100 futures products on multiple exchanges around the world including the Chicago Mercantile Exchange (CME), Hong Kong Futures Exchange Limited (HKFE), The New York Mercantile Exchange (NYMEX), The Chicago Board of Trade (CBOT), The Commodity Exchange (COMEX), Eurex Exchange (EUREX), ICE Clear Europe Limited (ICEU), Singapore Exchange (SGX), Australia Securities Exchange (ASX), Bursa Malaysia Derivatives Berhad (BMD), and Osaka Exchange (OSE). Our continuous efforts focused on offering value-added services and access to exchanges around the globe, together with user friendly experience, have enabled us to become a fast-growing online trading platform. The trading volume of futures contracts was 9.20 million trades in fiscal year 2020, 9.61 million trades in fiscal year 2021, and 1.44 million trades during the six months ended September 30, 2021. Our total registered customer number increased from 226 as of March 31, 2020 to 247 as of March 31, 2021, and further increased to 290 as of September 30, 2021. In fiscal year 2020, we had 77 revenue-generating accounts, including 61 accounts for futures trading and 16 accounts for securities trading. In fiscal year 2021, we had 49 revenue-generating accounts in total, including 33 accounts for futures trading and 16 accounts for securities trading. During the six months ended September 30, 2021, we had 61 revenue-generating accounts in total, including 15 accounts for futures trading, 8 accounts for securities trading, 29 accounts for structured notes subscriber services and 9 accounts for trading solution services. Our Operating Subsidiaries conduct the futures and stock brokerage business through two trading platforms, Esunny for futures trading and 2Go for stock trading, both of which were licensed from third parties and can be easily accessed through our application, or APP, software, and websites. The two platforms are designed to provide our clients access to our seamless, efficient, and secure trading platforms. We offer our customers comprehensive brokerage and value-added services, including trade order placement and execution, account management, and customer support. Given the importance of trading systems in our services, we strive to continuously enhance our IT infrastructure. During the fiscal years ended March 31, 2021 and 2020, our Operating Subsidiaries provided futures brokerage services and other services (including stock brokerage, options brokerage, consulting services, currency exchange services, structured note subscriber services, margin financing services). During the six months ended September 30, 2021, our Operating Subsidiaries started providing trading solution services. Our revenues were US$16.9 million and US$16.5 million for the years ended March 31, 2021 and 2020, respectively, and US$3.2 million and US$8.7 million for the six months ended September 30, 2021 and 2020, respectively. Commissions on futures brokerage accounted for 95.1%, and 98.1% of the total revenues for the years ended March 31, 2021 and 2020, respectively, and 75.7% and 97.3% of the total revenues for the six months ended September 30, 2021 and 2020, respectively. Revenues from the trading solution services accounted for 30.5% of the total revenues for the six months ended September 30, 2021. Additionally, our Operating Subsidiaries provide other financial services including stock brokerage, options brokerage, consulting services, currency exchange services, structured note subscriber services, margin financing services to our clients., Revenues generated from stock brokerage, consulting services, currency exchange services and structured note subscriber services accounted for 2.1% and 1.4% of total revenues, during the fiscal years ended March 31, 2021 and 2020, respectively, and 9.2% and 1.9% of total revenues during the six months ended September 30, 2021 and 2020, respectively. We did not generate revenue from options trading services or margin financing services for the fiscal years ended March 31, 2021 and 2020 and for the six months ended September 30, 2021. Our top five customers accounted for 91.6% and 64.8% of our total revenues for the years ended March 31, 2021 and 2020, respectively, and 94.8% and 92.0% of our total revenues for the six months ended September 30, 2021 and 2020, respectively. 1 We have achieved substantial growth since the launch of our operation of online brokerage services, as illustrated by the chart below which sets forth the number of futures contracts we have executed from January 1, 2017 to September 30, 2021, organized by calendar quarter. The number of futures contracts executed in each period depends on factors including, but not limited to, economic and political conditions, market conditions, pricing of future contracts, and the clients risk appetite. By the end of 2019 to the first half of 2020, the Southeast Asian financial market faced a number of uncertainties such as the outbreak of COVID-19. Trading activities dropped which impacted our fiscal quarters ended December 31, 2019 and March 31, 2020. As the COVID-19 pandemic became under relative control, trading activities recovered and remain moderately stable since the fiscal quarter ended on June 30, 2020. We intend to leverage our competitive strengths to sustain and grow our business, namely, to provide our clients with fast and reliable access to financial markets through our personalized client services and efficient organizational structure. In particular, we plan to expand our services offering and continue integrating value-added services, including CFD products and services and asset management. Impact of COVID-19 and our Responses and Opportunities Since early 2020, the ongoing COVID-19 pandemic has caused significant disruption to worldwide economic activities, including economic activities in Hong Kong where our Operating Subsidiaries are located, and in China, where our significant customer base is located. The Chinese government and the local Hong Kong government have imposed travel restrictions and quarantine requirements in response to COVID-19 from time to time in different regions. These measures hinder our client development, as clients who do not currently reside in Hong Kong could not easily travel to Hong Kong to open bank accounts, which affect their ability to trade on our platform. We have suspended face-to-face account opening, and instead implemented remote KYC procedures, which have partially compensated for the challenges caused by COVID-19 related restrictions. Through our timely adaptation to remote procedures, our total registered customer number increased from 226 as of March 31, 2020 to 247 as of March 31, 2021, and further increased to 290 as of September 30, 2021. In fiscal year 2020, through our Operating Subsidiaries, we had 77 revenue-generating accounts in total, including 61 accounts for futures trading and 16 accounts for securities trading. In fiscal year 2021, through our Operating Subsidiaries, we had 49 revenue-generating accounts in total, including 33 accounts for futures trading and 16 accounts for securities trading. During the six months ended September 30, 2021, we had 61 revenue-generating accounts in total, including 15 accounts for futures trading, 8 accounts for securities trading, 29 accounts for structured notes subscriber services and 9 accounts for trading solution services. We have taken other measures to reduce the impact of the COVID-19 pandemic, including, but not limited to, monitoring employees health on a daily basis, upgrading our telecommuting system and optimizing technology system to support potential growth in client s trading activities. During the period from April 2020 to March 2021, the trading volume of future contracts slightly increased by 4.37% year on year. During the period from April 2021 to September 2021, the trading volume of future contracts decreased by 71.4% year on year. We believed the decrease was caused by the investors reduced risk tolerance as a result of capital market volatility. However, we are uncertain as to when the COVID-19 pandemic will be constrained, so these government measures could continue to hinder us for a prolonged period of time, and we cannot guarantee our current remote procedures will be sufficient to allow us to attain our target growth in the future. In addition, whether the COVID-19 will lead to a prolonged downturn in the economy is still unknown, and we cannot be certain if a prolonged downturn in the economy will affect our clients trading activities. Although the COVID-19 pandemic has not severely affected our financial result so far, we cannot assure you that it will not materially and adversely affect our business, financial condition, and operations in the future. Our Industry According to the Futures Industry Association, the trading activities of exchange-traded futures and options around the globe have hit a record-high in 2020 with a total of 46,767.5 million contracts. Specifically, the Asia-Pacific region is the largest region in terms of trading volume of futures and options contracts, followed by North America. The number of traded futures and options contracts in Asia-Pacific increased from 14,503.2 million in 2019 to 20,147.1 million in 2020, at a year-on-year growth of 38.9%. 2 Hong Kong is one of the Company s major markets for its securities brokerage services. According to data published by the Stock Exchange of Hong Kong Limited, the capitalization of the securities market in Hong Kong grew from HK$ 33,998 billion in 2017 to HK$ 47,523 billion in 2020. The total turnover of the securities market in Hong Kong, which measures the dollar value of the total number of traded shares, increased from HK$21,709.2 billion in 2017 to HK$32,110 billion in 2020. The Company currently pursues a niche market strategy in Hong Kong and plans to expand to Southeast Asia as the first step in achieving the final goal of becoming the preferred online trading platforms for Asian investors worldwide, including the United States. Southeast Asia is widely acknowledged as the world s emerging growth engine. According to Monitor Deloitte, the ten markets that make up the Association of Southeast Asia Nations (ASEAN) form the 6th largest economy in the world and is projected to become the 4th largest by 2025. In light of the growing opportunities and our existing customer base primarily residing in Asia, we are currently focusing on expanding our customer base to Southeast Asian investors. There are emerging trends in the region such as increasing wealth and a rapidly growing middle class due to the booming economy which we intend to capitalize on. Our Competitive Strengths We believe that the following competitive strengths contribute to our success and differentiate us from our competitors: Experienced management and talented team; Streamlined and efficient organizational structure; and Access to important global exchanges. Our Strategies Our business model and competitive strengths provide us with multiple avenues for growth. We intend to execute the following key strategies: Expand demographic coverage to serve investors in Southeast Asia; Enhance our services and expand our product offering, including Contract for Difference (CFD) products and services; and Build a well-recognized and respected brand and increase customer loyalty. 3 Our Challenges The successful execution of our growth strategies is subject to risks and uncertainties related to our businesses, including those relating to: The relatively short operating history of our businesses; Unfavorable financial market and economic conditions; Our ability to compete effectively in the financial services industry; Our ability to recruit and retain key management and professional staff; Our ability to identify and control risks; Our ability to comply with extensive and evolving regulatory requirements; and Our ability to identify and address conflicts of interest, especially in relation to our Controlling Shareholder and its controlling shareholders. Corporate History We established ZYSL as a company with limited liability under the laws of Hong Kong and commenced our securities and futures brokerage business after obtaining licenses from the Securities and Futures Commission of Hong Kong ("HKSFC") on March 4, 2016 and October 18, 2016, respectively. To expand our services into asset management services, we obtained the relevant HKSFC licenses on in February 2018 through our subsidiary, ZYCL. On March 26, 2020, we carried out a series of transactions to reorganize the legal structure of the Company. As part of the reorganization, Zhong Yang Financial Group Limited ("ZYFGL") was incorporated under the laws of the Cayman Islands and two wholly-owned British Virgin Islands subsidiaries of ZYFGL, ZYSL (BVI) Limited ("ZYSL (BVI)") and ZYCL (BVI) Limited ("ZYCL (BVI)"), were then incorporated on August 29, 2019. With the approval obtained from HKSFC, the ownership interests in ZYSL and ZYCL were transferred from Zhong Yang Holdings Limited to ZYSL (BVI) and ZYCL (BVI) on March 26, 2020. In support of our plan to expand our securities and futures brokerage services to additional foreign exchanges, two new investment holding companies, namely ZYAL (BVI) Limited ("ZYAL (BVI)") and ZYNL (BVI) Limited ("ZYNL (BVI)"), were established under the laws of British Virgin Islands on January 7, 2021 and January 20, 2021, respectively. ZYAL (BVI) aims to obtain the Australian Financial Services License authorized by Australian Securities and Investments Commission ("ASIC") to provide financial services to clients through the acquisition of or merger with local licensed entities. ZYNL (BVI) aims at providing financial service in New Zealand and, accordingly, intends to become a Financial Service Provider ("FSP") registered on the Financial Service Providers Register ("FSPR") governed by the New Zealand Companies Office through an acquisition of or a merger with local licensed entities. ZYAL (BVI) and ZYNL (BVI) are both actively seeking suitable acquisition targets in order to obtain the relevant licenses. As of the date of this prospectus, they have not entered into any agreement with any targets. 4 Furthermore, on January 12, 2021, we incorporated an IT company, namely ZYTL (BVI) Limited ("ZYTL (BVI)"), with limited liability under the laws of British Virgin Islands for the purpose of strengthening our online trading platforms by either the potential acquisition of a software development company or by independent development. These three new subsidiaries have minimum operation as of the date of this prospectus. On May 14, 2021, we incorporated WIN100 TECH Limited under the laws of British Virgin Islands for the purpose of strengthening our online trading platforms by software development and IT support. WIN100 TECH Limited is a Fintech development and IT support company. It provides trading solutions for clients trading on the world s major derivatives and stock exchanges. On September 9, 2021, the sole shareholder of the Company surrendered 20,000,000 ordinary shares of US$0.001 par value each for no consideration. In addition, on September 9, 2021, the sole shareholder of the Company approved and effected an increase of the Company s authorized share capital from US$50,000, divided into 50,000,000 ordinary shares of a par value of US$0.001 per share, to US$150,000, divided into 150,000,000 ordinary shares of a par value of US$0.001 per share. All references to Ordinary Shares, share data, per share data, and related information have been retroactively adjusted, where applicable, in this prospectus to reflect the surrender of Ordinary Shares by the sole shareholder and the increase of our authorized Ordinary Shares as if these events had occurred at the beginning of the earliest period presented. Corporate Structure The following diagram illustrates the corporate structure of Zhang Yang Financial Group Limited and its subsidiaries as of the date of this prospectus, assuming the underwriters do not exercise the over-allotment option: Our Subsidiaries and Business Functions ZYSL (BVI) was incorporated as the investment holding company of ZYSL on August 29, 2019 as part of the reorganization. ZYCL (BVI) was incorporated as the investment holding company of ZYCL on August 29, 2019 as part of the reorganization. ZYSL was established in accordance with laws and regulations of Hong Kong on April 22, 2015 with a registered capital of HKD 18,000,000 (approximately US$2.3 million). ZYSL is a limited liability corporation licensed with HKSFC to carry out regulated activities including Type 1 Dealing in Securities and Type 2 Dealing in Futures Contracts. 5 ZYCL was established in accordance with laws and regulations of Hong Kong on September 29, 2016 with a registered capital of HKD 5,000,000 (approximately US$0.6 million). ZYCL is a limited liability corporation licensed with the HKSFC to carry out regulated activities Type 4 Advising on Securities, Type 5 Advising on Futures Contracts and Type 9 Asset Management. ZYAL (BVI), ZYTL (BVI) and ZYNL (BVI) were incorporated under the laws of British Virgin Islands on January 7, 2021, January 12, 2021 and January 20, 2021. These subsidiaries have minimum operation as of the date of this prospectus. WIN100 TECH Limited was incorporated under the laws of British Virgin Islands on May 14, 2021. It is a Fintech development and IT support company. It provides trading solutions for clients trading on the world s major derivatives and stock exchanges. Holding Company Structure ZYFGL is a holding company incorporated in the Cayman Islands with no material operations of its own. We conduct our operations primarily in Hong Kong through our subsidiaries in Hong Kong. The Ordinary Shares offered in this offering are shares of ZYFGL, the Cayman Islands holding company, instead of shares of our Operating Subsidiaries in Hong Kong. Investors in our Ordinary Shares should be aware that they may never directly hold equity interests in our Operating Subsidiaries. As a result of our corporate structure, ZYFGL s ability to pay dividends may depend upon dividends paid by our Operating Subsidiaries. If our existing Operating Subsidiaries or any newly formed ones incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us. Transfers of Cash between Our Company and Our Subsidiaries Our management monitors the cash position of each entity within our organization regularly and prepare budgets on a monthly basis to ensure each entity has the necessary funds to fulfill its obligation for the foreseeable future and to ensure adequate liquidity. In the event that there is a need for cash or a potential liquidity issue, it will be reported to our Chief Financial Officer and subject to approval by our board of directors, we will enter into an intercompany loan for the subsidiary. For ZYFGL to transfer cash to its subsidiaries, ZYFGL is permitted under the laws of the Cayman Islands and its memorandum and articles of association to provide funding to our subsidiaries incorporated in the British Virgin Islands and Hong Kong through loans or capital contributions without restrictions on the amount of the funds. ZYFGL s subsidiaries formed under the laws of the British Virgin Islands are permitted under the laws of the British Virgin Islands to provide funding to their respective subsidiaries formed in Hong Kong through loans or capital contributions without restrictions on the amount of the funds. For the subsidiaries to transfer cash to ZYFGL, according to the BVI Business Companies Act 2004 (as amended), a British Virgin Islands company may make dividends distribution to the extent that immediately after the distribution, such company s assets do not exceed its liabilities and that such company is able to pay its debts as they fall due. According to the Companies Ordinance of Hong Kong, a Hong Kong company may only make a distribution out of profits available for distribution. Other than the above, we did not adopt or maintain any cash management policies and procedures as of the date of this prospectus. The following describes the dividends and distributions made by our subsidiaries. ZYGFL has not made any dividends or distributions to U.S. investors as of the date of this prospectus. On March 24, 2020, ZYSL and ZYCL declared interim cash dividends of HK$3.9 million (approximately US$0.5 million) and HK$1.5 million (approximately US$0.2 million), respectively, to the then sole shareholder, i.e. the Predecessor Parent Company, Zhong Yang Holdings Limited. As of March 31, 2020, the dividend declared by ZYCL has been fully settled by directly deducting the dividend amount from the amount due from Zhong Yang Holdings Limited, and the dividend declared by ZYSL was recorded as dividend payable. On June 19, 2020, ZYSL settled such dividend payable in cash. On November 25, 2020, ZYSL declared an interim cash dividend of HK$24.8 million (equivalent to $3.2 million) to its sole shareholder ZYSL (BVI), following which event ZYSL (BVI) declared an interim cash dividend to its sole shareholder, ZYFGL, and ZYFGL declared an interim cash dividend to its shareholders for the same amount on the same day. None of the shareholders of ZYFGL at the time was a U.S. person. Without any withholding tax levied on dividends in Hong Kong, British Virgin Islands, and Cayman Islands, the interim cash dividends were settled with the shareholders in cash on November 25, 2020. On January 19, 2021, ZYSL declared an interim cash dividend of HK11.6 million (equivalent to US$1.5 million) to the then sole shareholder, the Predecessor Parent Company. The dividend was settled with the Predecessor Parent Company in cash in three installments of US$0.5 million each on January 19, 2021, January 20, 2021 and March 3, 2021. 6 Under the current practice of the Inland Revenue Department of Hong Kong, no tax is payable in Hong Kong in respect of dividends paid by us. The laws and regulations of the PRC on currency conversion control do not currently have any material impact on the transfer of cash from ZYFGL to ZYSL or ZYCL or from ZYSL or ZYCL to ZYFGL. There are no restrictions or limitations under the laws of Hong Kong imposed on the conversion of HK dollar into foreign currencies and the remittance of currencies out of Hong Kong, nor is there any restriction on any foreign exchange to transfer cash between ZYFGL and its subsidiaries, across borders and to U.S. investors, nor there is any restrictions and limitations to distribute earnings from the subsidiaries, to ZYFGL and U.S. investors and amounts owed. For ZYFGL to make dividends to its shareholders, subject to the Companies Act (2022 Revision) of the Cayman Islands, which we refer to as the Companies Act below, and our Amended and Restated Memorandum and Articles of Association, our board of directors may authorize and declare a dividend to shareholders from time to time out of the profits from the Company, realized or unrealized, or out of the share premium account, provided that the Company will remain solvent, meaning the Company is able to pay its debts as they come due in the ordinary course of business. There is no further Cayman Islands statutory restriction on the amount of funds which may be distributed by us in the form of dividends. We do not have any present plan to declare or pay any dividends on our Ordinary Shares in the foreseeable future. We currently intend to retain all available funds and future earnings, if any, for the operation and expansion of our business. Any future determination related to our dividend policy will be made at the discretion of our board of directors after considering our financial condition, results of operations, capital requirements, contractual requirements, business prospects and other factors the board of directors deems relevant, and subject to the restrictions contained in any future financing instruments, in our Amended and Restated Memorandum and Articles of Association and in the Companies Act. See "Dividend Policy" on page 43 and "Risk Factors — Risks Relating to our Corporate Structure – We rely on dividends and other distributions on equity paid by the Operating Subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of the Operating Subsidiaries to make payments to us could have a material adverse effect on our ability to conduct our business" on page 16 for more information. Enforceability of Civil Liabilities We are incorporated under the laws of the Cayman Islands as an exempted company with limited liability. Substantially all of our assets are located outside the United States. In addition, all of our directors and officers are nationals or residents of jurisdictions other than the United States and all or a substantial portion of their assets are located outside the United States. As a result, it may be difficult for investors to effect service of process within the United States upon us or these persons, or to enforce judgments obtained in U.S. courts against us or them, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States. It may also be difficult for you to enforce judgments obtained in U.S. courts based on the civil liability provisions of the U.S. federal securities laws against us and our officers and directors. We have appointed Cogency Global Inc. as our agent upon whom process may be served in any action brought against us under the securities laws of the United States. Harney Westwood & Riegels, our counsel as to the laws of the Cayman Islands has advised us that there is uncertainty as to whether the courts of the Cayman Islands would (1) recognize or enforce judgments of U.S. courts obtained against us or our directors or officers that are predicated upon the civil liability provisions of the federal securities laws of the United States or the securities laws of any state in the United States, or (2) entertain original actions brought in the Cayman Islands against us or our directors or officers that are predicated upon the federal securities laws of the United States or the securities laws of any state in the United States. Harney Westwood & Riegels has informed us that although there is no statutory enforcement in the Cayman Islands of judgments obtained in the federal or state courts of the United States (and the Cayman Islands are not a party to any treaties for the reciprocal enforcement or recognition of such judgments), a judgment in personam obtained in such jurisdiction will be recognized and enforced in the courts of the Cayman Islands at common law, without any re-examination of the merits of the underlying dispute, by an action commenced on the foreign judgment debt in the Grand Court of the Cayman Islands, provided such judgment (a) is given by a competent foreign court with jurisdiction to give the judgment, (b) imposes a specific positive obligation on the judgment debtor (such as an obligation to pay a liquidated sum or perform a specified obligation), (c) is final and conclusive, (d) is not in respect of taxes, a fine or a penalty; (e) has not been obtained by fraud; and (f) was not obtained in a manner and is not of a kind the enforcement of which is contrary to natural justice or the public policy of the Cayman Islands. However, the Cayman Islands courts are unlikely to enforce a judgment obtained from the U.S. courts under civil liability provisions of the U.S. federal securities law if such judgment is determined by the courts of the Cayman Islands to give rise to obligations to make payments that are penal or punitive in nature. Because such a determination has not yet been made by a court of the Cayman Islands, it is uncertain whether such civil liability judgments from U.S. courts would be enforceable in the Cayman Islands. A Cayman Islands court may stay enforcement proceedings if concurrent proceedings are being brought elsewhere. Stevenson, Wong & Co., our counsel with respect to Hong Kong law, has advised us that judgment of United States courts will not be directly enforced in Hong Kong. There are currently no treaties or other arrangements providing for reciprocal enforcement of foreign judgments between Hong Kong and the United States. However, the common law permits an action to be brought upon a foreign judgment. That is to say, a foreign judgment itself may form the basis of a cause of action since the judgment may be regarded as creating a debt between the parties to it. In a common law action for enforcement of a foreign judgment in Hong Kong, the enforcement is subject to various conditions, including but not limited to, that the foreign judgment is a final judgment conclusive upon the merits of the claim, the judgment is for a liquidated amount in a civil matter and not in respect of taxes, fines, penalties, or similar charges, the proceedings in which the judgment was obtained were not contrary to natural justice, and the enforcement of the judgment is not contrary to public policy of Hong Kong. Such a judgment must be for a fixed sum and must also come from a "competent" court as determined by the private international law rules applied by the Hong Kong courts. The defenses that are available to a defendant in a common law action brought on the basis of a foreign judgment include lack of jurisdiction, breach of natural justice, fraud, and contrary to public policy. However, a separate legal action for debt must be commenced in Hong Kong in order to recover such debt from the judgment debtor. See "Enforceability of Civil Liabilities" on page 7. 7 Risk Factor Summary Investing in our Ordinary Shares involves a high degree of risk. Below is a summary of material factors that make an investment in our Ordinary Shares speculative or risky. Importantly, this summary does not address all of the risks that we face. Please refer to the information contained in and incorporated by reference under the heading "Risk Factors" on page 16 of this prospectus for additional discussion of the risks summarized in this risk factor summary as well as other risks that we face. These risks include, but are not limited to, the following: Risks Relating to Our Corporate Structure Risks and uncertainties relating to our corporate structure, beginning on page 16 of this prospectus, include but not limited to the following: We rely on dividends and other distributions on equity paid by the Operating Subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of the Operating Subsidiaries to make payments to us could have a material adverse effect on our ability to conduct our business (page 16). Risks Relating to Doing Business in the Jurisdictions in which the Operating Subsidiaries Operate Risks and uncertainties relating to doing business in the jurisdiction in which the Operating Subsidiaries operate, beginning on page 16 of this prospectus, include but not limited to the following: Substantially all of the Operating Subsidiaries operations are in Hong Kong. However, due to the long arm provisions under the current PRC laws and regulations, the Chinese government may exercise significant oversight and discretion over the conduct of such business and may intervene in or influence such operations. at any time, which could result in a material change in the operations of the Operating Subsidiaries and/or the value of our Ordinary Shares. The PRC government may also intervene or impose restrictions on our ability to move money out of Hong Kong to distribute earnings and pay dividends or to reinvest in our business outside of Hong Kong. Changes in the policies, regulations, rules, and the enforcement of laws of the Chinese government may also be quick with little advance notice and our assertions and beliefs of the risk imposed by the PRC legal and regulatory system cannot be certain (page 16). We may become subject to a variety of PRC laws and other obligations regarding data security, and any failure to comply with applicable laws and obligations could have a material and adverse effect on our business, financial condition and results of operations (page 17). If the Chinese government chooses to extend the oversight and control over offerings that are conducted overseas and/or foreign investment in mainland China based issuers to Hong Kong-based issuers, such action may significantly limit or completely hinder our ability to offer or continue to offer Ordinary Shares to investors and cause the value of our Ordinary Shares to significantly decline or be worthless (page 18). The Hong Kong legal system embodies uncertainties which could limit the legal protections available to ZYSL and ZYCL (page 18). The Hong Kong regulatory requirement of prior approval for the transfer of shares in excess of a certain threshold may restrict future takeovers and other transactions (page 19). The enforcement of foreign civil liabilities in the Cayman Islands and Hong Kong is subject to certain conditions. Therefore, certain judgments obtained against us by our shareholders may be difficult to enforce in such jurisdictions (page 22). 8 Risks Relating to our Ordinary Shares and this Offering Risks and uncertainties relating to our ordinary shares and this offering, beginning on page 19 of this prospectus, include but not limited to the following: Our Ordinary Shares may be prohibited from being traded on a national exchange under the Holding Foreign Companies Accountable Act (the "HFCA Act"), if the Public Company Accounting Oversight Board (the "PCAOB") is unable to inspect our auditors for three consecutive years beginning in 2021. The delisting of our Ordinary Shares, or the threat of their being delisted, may materially and adversely affect the value of your investment (page 19). There has been no public market for our Ordinary Shares prior to this offering, and you may not be able to resell our Ordinary Shares at or above the price you paid, or at all (page 20). Because our initial public offering price is substantially higher than our pro forma net tangible book value per share, you will experience immediate and substantial dilution (page 21). There can be no assurance that we will not be a passive foreign investment company, or PFIC, for United States federal income tax purposes for any taxable year, which could subject United States investors in our Ordinary Shares to significant adverse United States income tax consequences (page 24). Risks Relating to Our Business and Industry Risks and uncertainties relating to our business and industry, beginning on page 26 of this prospectus, include but not limited to the following: We have a relatively short operating history compared to some of our established competitors and face significant risks and challenges in a rapidly evolving market, which makes it difficult to effectively assess our future prospects (page 26). Unfavorable financial market and economic conditions in Hong Kong, China, and elsewhere in the world could materially and adversely affect our business, financial condition, and results of operations (page 26). Geopolitical risks and political uncertainty may adversely impact economic conditions, increase market volatility, cause operational disruption to us and impact our strategic plans, which could have adverse effects on our business and its profitability (page 27). The online brokerage service industry and the financial services industry are intensely competitive. If we are unable to compete effectively, we may lose our market share and our results of operations and financial condition may be materially and adversely affected (page 27). During the years ended March 31, 2021 and 2020 and the six months ended September 30, 2021, our top five customers accounted for a significant portion of our total revenues. The loss of any such customers or a material decline in their trading activities through us would have an adverse effect on our operating results (page 27). We may not succeed in promoting and sustaining our brand, which could have an adverse effect on our future growth and business (page 28). Our businesses depend on key management executives and professional staff, and our business may suffer if we are unable to recruit and retain them (page 29). We are subject to extensive and evolving regulatory requirements, the non-compliance with which may result in penalties, limitations, and prohibitions on our future business activities or suspension or revocation of our licenses, and consequently may materially and adversely affect our business, financial condition, and results of operations. In addition, we may, from time to time, be subject to regulatory inquiries and investigations by relevant regulatory authorities or government agencies in Hong Kong or other applicable jurisdictions (page 29). We face additional risks as we offer new products and services, transact with a broader array of clients and counterparties and expose ourselves to new geographical markets (page 30). We may incur losses or experience disruption of our operations as a result of unforeseen or catastrophic events, including pandemics, terrorist attacks, or natural disasters (page 36). Aggressive competition could reduce our market share, revenues and profits (page 36). 9 Holding Foreign Companies Accountable Act (the "HFCA Act") The HFCA Act was enacted on December 18, 2020. The HFCA Act states if the SEC determines that a company has filed audit reports issued by a registered public accounting firm that has not been subject to inspection by the PCAOB for three consecutive years beginning in 2021, the SEC shall prohibit the company s shares from being traded on a national securities exchange or in the over the counter trading market in the United States. On March 24, 2021, the SEC adopted interim final rules relating to the implementation of certain disclosure and documentation requirements of the HFCA Act. A company will be required to comply with these rules if the SEC identifies it as having a "non-inspection" year under a process to be subsequently established by the SEC. The SEC is assessing how to implement other requirements of the HFCA Act, including the listing and trading prohibition requirements described above. On June 22, 2021, the U.S. Senate passed a bill which, if passed by the U.S. House of Representatives and signed into law, would reduce the number of consecutive non-inspection years required for triggering the prohibitions under the HFCA Act from three years to two years. On December 2, 2021, the SEC issued amendments to finalize rules implementing the submission and disclosure requirements in the HFCA Act, which took effect on January 10, 2022. The rules apply to registrants that the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located in a foreign jurisdiction and that PCAOB is unable to inspect or investigate completely because of a position taken by an authority in foreign jurisdictions. On December 16, 2021, PCAOB announced the PCAOB HFCA Act determinations (the "PCAOB determinations") relating to the PCAOB s inability to inspect or investigate completely registered public accounting firms headquartered in mainland China of the PRC or Hong Kong, a Special Administrative Region and dependency of the PRC, because of a position taken by one or more authorities in the PRC or Hong Kong. Our auditor, Friedman LLP, the independent registered public accounting firm that issues the audit report included in this prospectus, as an auditor of companies that are traded publicly in the United States and a firm registered with the PCAOB, is subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess Friedman LLP s compliance with applicable professional standards. Friedman LLP is headquartered in Manhattan, New York with no branches or offices outside the United States and has been inspected by the PCAOB on a regular basis, with the last inspection in June 2018. Therefore, we believe that, as of the date of this prospectus, our auditor is not subject to the PCAOB determinations. See "Risk Factors — Risks Relating to Our Ordinary Shares and this Offering — Our Ordinary Shares may be prohibited from being traded on a national exchange under the Holding Foreign Companies Accountable Act (the "HFCA Act"), if the Public Company Accounting Oversight Board (the "PCAOB") is unable to inspect our auditors for three consecutive years beginning in 2021. The delisting of our Ordinary Shares, or the threat of their being delisted, may materially and adversely affect the value of your investment" on page 19. We cannot assure you whether Nasdaq or other regulatory authorities will apply additional or more stringent criteria to us. Such uncertainty could cause the market price of our Ordinary Shares to be materially and adversely affected. Permission Required from the Hong Kong Authorities Due to the licensing requirements of the HKSFC, ZYSL and ZYCL are required to obtain necessary licenses to conduct their business in Hong Kong and their business and responsible personnel are subject to the relevant laws and regulations and the respective rules of the HKSFC. ZYSL currently holds a Type 1 license for dealing in securities and a Type 2 license for dealing in futures contracts. ZYCL currently holds a Type 4 license for advising on securities, a Type 5 license for advising on futures contracts and a Type 9 license for asset management. See "Regulation—Licensing Regime Under the HKSFO" on page 92. These licenses have no expiration date and will remain valid unless they are suspended, revoked or cancelled by the HKSFC. We pay standard governmental annual fees to the HKSFC and are subject to continued regulatory obligations and requirements, including the maintenance of minimum paid-up share capital and liquid capital, maintenance of segregated accounts, and submission of audited accounts and other required documents, among others. See "Regulation—Licensing Regime Under the HKSFO" on page 92. Neither we nor any of our subsidiaries are required to obtain any permission or approval from Hong Kong authorities to offer the securities of ZYFGL to foreign investors. Recent Regulatory Development in the PRC We are aware that, recently, the PRC government initiated a series of regulatory actions and statements to regulate business operations in certain areas in China with little advance notice, including cracking down on illegal activities in the securities market, enhancing supervision over China-based companies listed overseas using a variable interest entity structure, adopting new measures to extend the scope of cybersecurity reviews, and expanding the efforts in anti-monopoly enforcement. 10 For example, on June 10, 2021, the Standing Committee of the National People s Congress enacted the PRC Data Security Law, which took effect on September 1, 2021. The law requires data collection to be conducted in a legitimate and proper manner, and stipulates that, for the purpose of data protection, data processing activities must be conducted based on data classification and hierarchical protection system for data security. On July 6, 2021, the General Office of the Communist Party of China Central Committee and the General Office of the State Council jointly issued a document to crack down on illegal activities in the securities market and promote the high-quality development of the capital market, which, among other things, requires the relevant governmental authorities to strengthen cross-border oversight of law-enforcement and judicial cooperation, to enhance supervision over China-based companies listed overseas, and to establish and improve the system of extraterritorial application of the PRC securities laws. On August 20, 2021, the 30th meeting of the Standing Committee of the 13th National People s Congress voted and passed the "Personal Information Protection Law of the People s Republic of China", or "PRC Personal Information Protection Law", which became effective on November 1, 2021. The PRC Personal Information Protection Law applies to the processing of personal information of natural persons within the territory of China that is carried out outside of China where (1) such processing is for the purpose of providing products or services for natural persons within China, (2) such processing is to analyze or evaluate the behavior of natural persons within China, or (3) there are any other circumstances stipulated by related laws and administrative regulations. On December 24, 2021, the China Securities Regulatory Commission ("CSRC"), together with other relevant government authorities in China issued the Provisions of the State Council on the Administration of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments), and the Measures for the Filing of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) ("Draft Overseas Listing Regulations"). The Draft Overseas Listing Regulations requires that a PRC domestic enterprise seeking to issue and list its shares overseas ("Overseas Issuance and Listing") shall complete the filing procedures of and submit the relevant information to CSRC. The Overseas Issuance and Listing includes direct and indirect issuance and listing. Where an enterprise whose principal business activities are conducted in PRC seeks to issue and list its shares in the name of an overseas enterprise ("Overseas Issuer") on the basis of the equity, assets, income or other similar rights and interests of the relevant PRC domestic enterprise, such activities shall be deemed an indirect overseas issuance and listing ("Indirect Overseas Issuance and Listing") under the Draft Overseas Listing Regulations. On December 28, 2021, the CAC jointly with the relevant authorities formally published Measures for Cybersecurity Review (2021) which took effect on February 15, 2022 and replace the former Measures for Cybersecurity Review (2020) issued on July 10, 2021. Measures for Cybersecurity Review (2021) stipulates that operators of critical information infrastructure purchasing network products and services, and online platform operator (together with the operators of critical information infrastructure, the "Operators") carrying out data processing activities that affect or may affect national security, shall conduct a cybersecurity review, any online platform operator who controls more than one million users personal information must go through a cybersecurity review by the cybersecurity review office if it seeks to be listed in a foreign country. Our Operating Subsidiaries may collect and store certain data (including certain personal information) from our clients, who may be PRC individuals, in connection with our business and operations and for "Know Your Customers" purposes (to combat money laundering). Given that (1) our Operating Subsidiaries are incorporated in Hong Kong or the British Virgin Islands and are located in Hong Kong, (2) we have no subsidiary, VIE structure nor any direct operations in mainland China, and (3) pursuant to the Basic Law of the Hong Kong Special Administrative Region (the "Basic Law"), which is a national law of the PRC and the constitutional document for Hong Kong, national laws of the PRC shall not be applied in Hong Kong except for those listed in Annex III of the Basic Law (which is confined to laws relating to defense and foreign affairs, as well as other matters outside the autonomy of Hong Kong), as advised by Guangdong Wesley Law Firm, our counsel with respect to certain PRC legal matters, the Measures for Cybersecurity Review (2021), the PRC Personal Information Protection Law and the Draft Overseas Listing Regulations will not have an impact on our business, operations or this offering, as our Operating Subsidiaries will not be deemed to be an "Operator" that are required to file for cybersecurity review before listing in the United States, because (i) our Operating Subsidiaries were incorporated in Hong Kong and the British Virgin Islands and operate in Hong Kong without any subsidiary or VIE structure in mainland China and each of the Measures for Cybersecurity Review (2021), the PRC Personal Information Protection Law and the Draft Overseas Listing Regulations remains unclear whether it shall be applied to a company based in Hong Kong; (ii) as of date of this prospectus, our Operating Subsidiaries have in aggregate collected and stored personal information of approximately 300 PRC individuals (i.e., less than one million users); (iii) all of the data our Operating Subsidiaries have collected is stored in servers located in Hong Kong; and (iv) as of the date of this prospectus, none of our Operating Subsidiaries have been informed by any PRC governmental authority of any requirement that it files for a cybersecurity review or a CSRC review. 11 However, as further advised by Guangdong Wesley Law Firm, since these statements and regulatory actions are new, it is highly uncertain how soon the legislative or administrative regulation making bodies will respond and what existing or new laws or regulations or detailed implementations and interpretations will be modified or promulgated, if any. It is also highly uncertain what the potential impact such modified or new laws and regulations will have on the daily business operations of our Operating Subsidiaries, their respective abilities to accept foreign investments and the listing of our Ordinary Shares on a U.S. or other foreign exchanges. There remains significant uncertainty in the interpretation and enforcement of relevant PRC cybersecurity laws and regulations. If the Draft Overseas Listing Regulations are adopted into law in the future and becomes applicable to our Operating Subsidiaries, if any of our Operating Subsidiaries is deemed to be an "Operator", or if the Measures for Cybersecurity Review (2021) or the PRC Personal Information Protection Law becomes applicable to our Operating Subsidiaries, the business operation of our Operating Subsidiaries and the listing of our Ordinary Shares in the United States could be subject to the CAC s cybersecurity review or CSRC Overseas Issuance and Listing review in the future. If the applicable laws, regulations, or interpretations change and our Operating Subsidiaries become subject to the CAC or CSRC review, we cannot assure you that our Operating Subsidiaries will be able to comply with the regulatory requirements in all respects and our current practice of collecting and processing personal information may be ordered to be rectified or terminated by regulatory authorities. If our Operating Subsidiaries fails to receive or maintain such permissions or if the required approvals are denied, our Operating Subsidiaries may become subject to fines and other penalties which may have a material adverse effect on our business, operations and financial condition and may hinder our ability to offer or continue to offer Ordinary Shares to investors and cause the value of our Ordinary Shares to significantly decline or be worthless. Additionally, due to long arm provisions under the current PRC laws and regulations, there remains regulatory uncertainty with respect to the implementation and interpretation of laws in China. We are also subject to the risks of uncertainty about any future actions the Chinese government or authorities in Hong Kong may take in this regard. Should the Chinese government choose to exercise significant oversight and discretion over the conduct of our business, they may intervene in or influence our operations. Such governmental actions: could result in a material change in our operations; could hinder our ability to continue to offer securities to investors; and may cause the value of our Ordinary Shares to significantly decline or be worthless. Implications of Being an "Emerging Growth Company" As a company with less than US$1.07 billion in revenues during our last fiscal year, we qualify as an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. An "emerging growth company" may take advantage of reduced reporting requirements that are otherwise applicable to larger public companies. In particular, as an emerging growth company, we: may present only two years of audited financial statements and only two years of related Management s Discussion and Analysis of Financial Condition and Results of Operations, or "MD&A"; are not required to provide a detailed narrative disclosure discussing our compensation principles, objectives and elements and analyzing how those elements fit with our principles and objectives, which is commonly referred to as "compensation discussion and analysis"; are not required to obtain an attestation and report from our auditors on our management s assessment of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002; are not required to obtain a non-binding advisory vote from our shareholders on executive compensation or golden parachute arrangements (commonly referred to as the "say-on-pay," "say-on frequency" and "say-on-golden-parachute" votes); are exempt from certain executive compensation disclosure provisions requiring a pay-for-performance graph and chief executive officer pay ratio disclosure; are eligible to claim longer phase-in periods for the adoption of new or revised financial accounting standards under 107 of the JOBS Act; and will not be required to conduct an evaluation of our internal control over financial reporting. 12 We intend to take advantage of all of these reduced reporting requirements and exemptions, including the longer phase-in periods for the adoption of new or revised financial accounting standards under 107 of the JOBS Act. Our election to use the phase-in periods may make it difficult to compare our financial statements to those of non-emerging growth companies and other emerging growth companies that have opted out of the phase-in periods under 107 of the JOBS Act. We will remain an emerging growth company until the earliest of (i) the last day of the fiscal year during which we have total annual gross revenues of at least US$1.07 billion; (ii) the last day of our fiscal year following the fifth anniversary of the completion of this offering; (iii) the date on which we have, during the preceding three-year period, issued more than US$1.0 billion in non-convertible debt; or (iv) the date on which we are deemed to be a "large accelerated filer" under the Securities Exchange Act of 1934, as amended, or the Exchange Act, which would occur if the market value of our Ordinary Shares that are held by non-affiliates exceeds US$700 million as of the last business day of our most recently completed second fiscal quarter. Once we cease to be an emerging growth company, we will not be entitled to the exemptions provided in the JOBS Act discussed above. Implications of Being a Foreign Private Issuer We are a foreign private issuer within the meaning of the rules under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). As such, we are exempt from certain provisions applicable to United States domestic public companies. For example: we are not required to provide as many Exchange Act reports, or as frequently, as a domestic public company; for interim reporting, we are permitted to comply solely with our home country requirements, which are less rigorous than the rules that apply to domestic public companies; we are not required to provide the same level of disclosure on certain issues, such as executive compensation; we are exempt from provisions of Regulation FD aimed at preventing issuers from making selective disclosures of material information; we are not required to comply with the sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations in respect of a security registered under the Exchange Act; and we are not required to comply with Section 16 of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and establishing insider liability for profits realized from any "short-swing" trading transaction. Implications of Being a Controlled Company Controlled companies are exempt from the majority of independent director requirements. Controlled companies are subject to an exemption from Nasdaq standards requiring that the board of a listed company consist of a majority of independent directors within one year of the listing date. 13 Public Companies that qualify as a "Controlled Company" with securities listed on the Nasdaq Stock Market (Nasdaq), must comply with the exchange s continued listing standards to maintain their listings. Nasdaq has adopted qualitative listing standards. Companies that do not comply with these corporate governance requirements may lose their listing status. Under the Nasdaq rules, a "controlled company" is a company with more than 50% of its voting power held by a single person, entity or group. Under Nasdaq rules, a controlled company is exempt from certain corporate governance requirements including: the requirement that a majority of the board of directors consist of independent directors; the requirement that a listed company have a nominating and governance committee that is composed entirely of independent directors with a written charter addressing the committee s purpose and responsibilities; the requirement that a listed company have a compensation committee that is composed entirely of independent directors with a written charter addressing the committee s purpose and responsibilities; and the requirement for an annual performance evaluation of the nominating and governance committee and compensation committee. Controlled companies must still comply with the exchange s other corporate governance standards. These include having an audit committee and the special meetings of independent or non-management directors. Upon the completion of this offering, our Controlling Shareholder will own 85.71% of our total issued and outstanding Ordinary Shares, representing 85.71% of the total voting power, assuming that the underwriters do not exercise their over-allotment option, or 83.92% of our total issued and outstanding Ordinary Shares, representing 83.92% of the total voting power, assuming that the over-allotment option is exercised in full. As a result, we will be a "controlled company" as defined under Nasdaq Listing Rule 5615(c) because our Controlling Shareholder will hold more than 50% of the voting power for the election of directors. As a "controlled company," we are permitted to elect not to comply with certain corporate governance requirements. We do not plan to rely on these exemptions, but we may elect to do so after we complete this offering. Corporate Information Our principal executive offices are located at Flat 1101, 118 Connaught Road West, Hong Kong. Our telephone number at this address is +852 3107 0731. Our registered office in the Cayman Islands is located at the offices of Vistra (Cayman) Limited, P. O. Box 31119 Grand Pavilion, Hibiscus Way, 802 West Bay Road, Grand Cayman, KY1 - 1205 Cayman Islands. Our agent for service of process in the United States is Cogency Global Inc. located at 122 East 42nd Street, 18th Floor, New York, NY 10168. Investors should contact us for any inquiries through the address and telephone number of our principal executive offices. Our website is www.zyfgl.com. The information contained on our website is not a part of this prospectus. 14 THE OFFERING Below
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+PROSPECTUS SUMMARY This is only a summary of the prospectus and, while it contains material information about UNL and its shares, it does not contain or summarize all of the information about UNL and the shares contained in this prospectus that is material and/or which may be important to you. You should read this entire prospectus, including "Risk Factors Involved with an Investment in UNL" beginning on page 8 , before making an investment decision about the shares. For a glossary of defined terms, see Appendix A. United States 12 Month Natural Gas Fund, LP ("UNL"), a Delaware limited partnership, is a commodity pool that continuously issues common shares of beneficial interest that may be purchased and sold on the NYSE Arca stock exchange ("NYSE Arca"). UNL is managed and controlled by United States Commodity Funds LLC ("USCF"), a Delaware limited liability company. USCF is registered as a CPO with the CFTC and is a member of the NFA. UNL s Investment Objective and Strategy UNL s investment objective is for the daily percentage changes in the NAV per share to reflect the daily percentage changes of the spot price of natural gas delivered at the Henry Hub, Louisiana as measured by the daily changes in the average of the prices of 12 futures contracts on natural gas traded on the New York Mercantile Exchange (the "NYMEX"), consisting of the near month contract to expire and the contracts for the following 11 months, for a total of 12 consecutive months contracts, except when the near month contract is within two weeks of expiration, in which case it will be measured by the futures contract that is the next month contract to expire and the contracts for the following 11 consecutive months (the "Benchmark Futures Contracts"), plus interest earned on UNL s collateral holdings, less UNL s expenses. UNL seeks to achieve its investment objective by investing so that the average daily percentage change in UNL s NAV for any period of 30 successive valuation days will be within plus/minus ten percent (10%) of the average daily percentage change in the price of the Benchmark Futures Contracts over the same period. What are the "Benchmark Futures Contracts"? The Benchmark Futures Contracts are the futures contracts on natural gas as traded on the New York Mercantile Exchange (the "NYMEX") that are the near month contract to expire, and the contracts for the following 11 months, for a total of 12 consecutive months contracts, except when the near month contract is within two weeks of expiration, in which case they are measured by the futures contracts that are the next month contract to expire and the contracts for the following 11 consecutive months. When calculating the daily movement of the average price of the 12 contracts, each contract month is equally weighted. UNL seeks to achieve its investment objective by investing primarily in futures contracts for natural gas that are traded on the NYMEX, ICE Futures Europe and ICE Futures U.S. (together, "ICE Futures"), or other U.S. and foreign exchanges (collectively, "Futures Contracts") and, to a lesser extent, in order to comply with regulatory requirements, or in view of market conditions, other natural gas investments such as cash-settled options on Futures Contracts, forward contracts for natural gas, cleared swap contracts, and non-exchange traded ("over-the-counter" or "OTC") transactions that are based on the price of natural gas, crude oil and other petroleum-based fuels, as well as futures contracts for crude oil, heating oil, gasoline, and other petroleum-based fuels, Futures Contracts and indices based on the foregoing (collectively, "Other Natural Gas-Related Investments"). Market conditions that USCF currently anticipates could cause UNL to invest in Other Natural Gas-Related Investments include, but are not limited to, those allowing UNL to obtain greater liquidity or to execute transactions with more favorable pricing. For convenience and unless otherwise specified, Futures Contracts and Other Natural Gas-Related Investments collectively are referred to as "Natural Gas Interests" in this prospectus. In addition, USCF believes that market arbitrage opportunities will cause daily changes in UNL s share price on the NYSE Arca on a percentage basis to closely track daily changes in UNL s per share NAV on a percentage basis. USCF further believes that the daily changes in average of the prices of the Benchmark Futures Contracts have historically closely tracked the daily changes in the spot price of natural gas. USCF believes that the net effect of these two expected relationships will be that the daily changes in the price of UNL s shares on the NYSE Arca on a percentage basis will continue to closely track the daily changes in the spot price of natural gas on a percentage basis, less UNL s expenses. Specifically, UNL seeks to achieve its investment objective by investing so that the average daily percentage change in UNL s NAV for any period of 30 successive valuation days will be within plus/minus ten percent (10%) of the average daily percentage change in the price of the Benchmark Futures Contracts over the same period. The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion, dated April 8 , 2022 PRELIMINARY PROSPECTUS United States 12 Month Natural Gas Fund, LP * Shares *Principal U.S. Listing Exchange: NYSE Arca, Inc. The United States 12 Month Natural Gas Fund, LP ("UNL") is an exchange traded fund organized as a limited partnership that issues shares that trade on the NYSE Arca stock exchange ("NYSE Arca"). UNL s investment objective is for the daily changes in percentage terms of its shares per share net asset value ("NAV") to reflect the daily changes in percentage terms of the price of natural gas delivered at the Henry Hub, Louisiana, as measured by the daily changes in the average of the prices of specified short-term futures contracts on natural gas called the "Benchmark Futures Contracts", plus interest earned on UNL s collateral holdings, less UNL s expenses. UNL pays its general partner, United States Commodity Funds LLC ("USCF"), a limited liability company, a management fee and incurs operating costs. USCF and UNL are located at 1850 Mt. Diablo Boulevard, Suite 640, Walnut Creek, California 94596. The telephone number for both USCF and UNL is 510.522.9600. In order for a hypothetical investment in shares to break even over the next 12 months, assuming a selling price of $14.28 (the net asset value as of February 28, 2022), the investment would have to generate a 0.952% return or $0.136, rounded to $0.14. The amount for this breakeven analysis takes into account a fee waiver, which USCF may terminate at any time in its discretion. UNL is an exchange traded fund. This means that most investors who decide to buy or sell shares of UNL shares place their trade orders through their brokers and may incur customary brokerage commissions and charges. Shares trade on the NYSE Arca under the ticker symbol "UNL" and are bought and sold throughout the trading day at bid and ask prices like other publicly traded securities. Shares trade on the NYSE Arca after they are initially purchased by "Authorized Participants," institutional firms that purchase and redeem shares in blocks of 50,000 shares called "baskets" through UNL s marketing agent, ALPS Distributors, Inc. (the "Marketing Agent"). The price of a basket is equal to the net asset value ("NAV") of 50,000 shares on the day that the order to purchase the basket is accepted by the Marketing Agent. The NAV per share is calculated by taking the current market value of UNL s total assets (after close of NYSE Arca) subtracting any liabilities and dividing that total by the total number of outstanding shares. The offering of UNL s shares is a "best efforts" offering, which means that neither the Marketing Agent nor any Authorized Participant is required to purchase a specific number or dollar amount of shares. USCF pays the Marketing Agent a marketing fee consisting of a fixed annual amount plus an incentive fee based on the amount of shares sold. Authorized Participants will not receive from UNL, USCF or any of their affiliates, any fee or other compensation in connection with the sale of shares. Aggregate compensation paid to the Marketing Agent and any affiliate of USCF for distribution-related services in connection with this offering of shares will not exceed ten percent (10%) of the gross proceeds of the offering. Investors who buy or sell shares during the day from their broker may do so at a premium or discount relative to the market value of the underlying natural gas futures contracts in which UNL invests due to supply and demand forces at work in the secondary trading market for shares that are closely related to, but not identical to, the same forces influencing the prices of natural gas and the natural gas futures contracts that serve as UNL s investment benchmark. INVESTING IN UNL INVOLVES RISKS SIMILAR TO THOSE INVOLVED WITH AN INVESTMENT DIRECTLY IN THE NATURAL GAS MARKET, BUT IT IS NOT A PROXY FOR TRADING DIRECTLY IN THE NATURAL GAS MARKETS. Investing in UNL also involves the correlation risk described below and other significant risks. You should consider carefully the risks described below before making an investment decision. See "Risk Factors Involved with an Investment in UNL" beginning on page 8 . The offering of UNL s shares is registered with the Securities and Exchange Commission ("SEC") in accordance with the Securities Act of 1933 (the "1933 Act"). The offering is intended to be a continuous offering and is not expected to terminate until all of the registered shares have been sold or three years from the date of the original offering, whichever is earlier, unless extended as permitted under the rules under the 1933 Act, although the offering may be temporarily suspended if and when no suitable investments for UNL are available or practicable. UNL is not a mutual fund registered under the Investment Company Act of 1940 ("1940 Act") and is not subject to regulation under the 1940 Act. Investors should be aware that UNL s investment objective is not for its NAV or market price of shares to equal, in dollar terms, the spot price of natural gas or any particular futures contract based on natural gas nor is UNL s investment objective for the percentage change in its NAV to reflect the percentage change of the price of any particular futures contract as measured over a time period greater than one day. This is because natural market forces called contango and backwardation have impacted the total return on an investment in UNL s shares during the past year relative to a hypothetical direct investment in natural gas and, in the future, it is likely that the relationship between the market price of UNL s shares and changes in the spot prices of natural gas will continue to be so impacted by contango and backwardation. (It is important to note that the disclosure above ignores the potential costs associated with physically owning and storing natural gas, which could be substantial.) Principal Investment Risks of an Investment in UNL An investment in UNL involves a degree of risk. Some of the risks you may face are summarized below. A more extensive discussion of these risks appears beginning on page 8 . Investment Risk Investors may choose to use UNL as a means of investing indirectly in natural gas. INVESTING IN UNL INVOLVES RISKS SIMILAR TO THOSE INVOLVED WITH AN INVESTMENT DIRECTLY IN THE NATURAL GAS MARKET, BUT IT IS NOT A PROXY FOR TRADING DIRECTLY IN THE NATURAL GAS MARKETS. Investing in UNL also involves the correlation risk described below and other significant risks. You should consider carefully the risks described below before making an investment decision. An investment in UNL involves the following investment risks: The daily changes in percentage terms of UNL s shares per share NAV relates directly to daily changes in the average of the prices of the Benchmark Futures Contracts and other assets held by UNL and fluctuations in the prices of these assets could materially adversely affect an investment in UNL s shares. Past performance is not necessarily indicative of future results; all or substantially all of an investment in UNL could be lost. The demand for natural gas correlates closely with general economic growth rates. Other factors that may affect the demand for natural gas and therefore its price, include technological improvements in energy efficiency; seasonal weather patterns, which affect the demand for natural gas associated with heating; increased competitiveness of alternative energy sources that have so far generally not been competitive with natural gas without the benefit of government subsidies or mandates; and changes in technology or consumer preferences that alter fuel choices, such as toward alternative fueled or electric transportation and broad-based changes in personal income level. Natural gas prices also vary depending on a number of factors affecting supply. The supply of and demand for natural gas may also be impacted by changes in interest rates, inflation, and other local or regional market conditions. Price volatility may possibly cause the total loss of your investment . Russia s invasion of Ukraine, and sanctions brought by the United States and other countries against Russia, have caused disruptions in many business sectors and have resulted in significant market disruptions and may lead to increased volatility in the price of certain commodities, including oil and natural gas as well as increased volatility in UNL s share price . COVID-19 and other infectious disease outbreaks could negatively affect the valuation and performance of UNL s investments. An investment in UNL may provide little or no diversification benefits. Thus, in a declining market, UNL may have no gains to offset losses from other investments, and an investor may suffer losses on an investment in UNL while incurring losses with respect to other asset classes. Historical performance of UNL and the Benchmark Futures Contracts is not indicative of future performance. NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THE SECURITIES OFFERED IN THIS PROSPECTUS, OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. UNL is a commodity pool and USCF is a commodity pool operator ("CPO") subject to regulation by the Commodity Futures Trading Commission ("CFTC") and the National Futures Association ("NFA") under the Commodity Exchange Act ("CEA"). THE COMMODITY FUTURES TRADING COMMISSION HAS NOT PASSED UPON THE MERITS OF PARTICIPATING IN THIS POOL NOR HAS THE COMMISSION PASSED ON THE ADEQUACY OR ACCURACY OF THIS DISCLOSURE DOCUMENT. The date of this prospectus is April 8 , 2022. Correlation Risk As further described below, an investment in UNL involves the following correlation risks: The market price at which investors buy or sell shares may be significantly less or more than NAV. Daily percentage changes in UNL s NAV may not correlate with daily percentage changes in the average of the prices of the Benchmark Futures Contracts. Daily percentage changes in the prices of the Benchmark Futures Contracts may not correlate with daily percentage changes in the spot price of natural gas. An investment in UNL is not a proxy for investing in the natural gas markets, and the daily percentage changes in the price of the Benchmark Futures Contracts, or the NAV of UNL, may not correlate with daily percentage changes in the spot price of natural gas. Natural forces in the natural gas futures market known as "backwardation" and "contango" may increase UNL s tracking error and/or negatively impact total return. The Russian invasion and related developments have placed upward pressure on the price of the Benchmark Futures Contracts. As a result, near to expire contracts trade at a higher price than longer to expire contracts, a situation referred to as "backwardation." There can be no assurance that the current period of backwardation will continue or how long it may continue. Accountability levels, position limits, and daily price fluctuation limits set by the exchanges have the potential to cause tracking error, by limiting UNL s investments, including its ability to fully invest in the Benchmark Futures Contracts, which could cause the price of shares to substantially vary from the price of the Benchmark Futures Contracts. Risk mitigation measures that could be imposed by UNL s futures commission merchants ("FCMs") have the potential to cause tracking error by limiting UNL s investments, including its ability to fully invest in the Benchmark Futures Contracts and other Futures Contracts, which could cause the price of UNL s shares to substantially vary from the price of the Benchmark Futures Contracts. To the extent that investors use UNL as a means of indirectly investing in natural gas, there is the risk that the daily changes in the price of UNL s shares on the NYSE Arca on a percentage basis will not closely track the daily changes in the spot price of natural gas on a percentage basis. This could happen if the price of shares traded on the NYSE Arca does not correlate closely with the value of UNL s NAV; the changes in UNL s NAV do not correlate closely with the changes in the average price of the Benchmark Futures Contracts; or the changes in the average price of the Benchmark Futures Contracts do not closely correlate with the changes in the cash or spot price of natural gas. This is a risk because if these correlations do not exist, then investors may not be able to use UNL as a cost-effective way to indirectly invest in natural gas or as a hedge against the risk of loss in natural gas-related transactions. USCF believes that holding futures contracts whose expiration dates are spread out over a 12 month period of time will cause the total return of such a portfolio to vary compared to a portfolio that holds only a single month s contract (such as the near month contract). In particular, USCF believes that the total return of a portfolio holding contracts with a range of expiration months will be impacted differently by the price relationship between different contract months of the same commodity future compared to the total return of a portfolio consisting of the near month contract. For example, in cases in which the near month contract s price is higher than the price of contracts that expire later in time (a situation known as "backwardation" in the futures markets), then absent the impact of the overall movement in natural gas prices, the value of the near month contract would tend to rise as it approaches expiration. Conversely, in cases in which the near month contract s price is lower than the price of contracts that expire later in time (a situation known as "contango" in the futures markets), then absent the impact of the overall movement in natural gas prices, the value of the near month contract would tend to decline as it approaches expiration. The total return of a portfolio that owned the near month contract and "rolled" forward each month by selling the near month contract as it approached expiration and purchasing the next month contract to expire would be positively impacted by a backwardation market, and negatively impacted by a contango market. Depending on the exact price relationship of the different month s prices, portfolio expenses, and the overall movement of natural gas prices, the impact of backwardation and contango could have a major impact on the total return of such a portfolio over time. USCF believes that based on historical evidence, a portfolio that held futures contracts with a range of expiration dates spread out over a 12 month period of time would typically be impacted less by the positive effect of backwardation and the negative effect of contango compared to a portfolio that held contracts of a single near month. As a result, absent the impact of any other factors, a portfolio of 12 different monthly contracts would tend to have a lower return than a near month only portfolio in a backwardation market and a higher total return in a contango market. However, there can be no assurance that such historical relationships would provide the same or similar results in the future. Volatility in the natural gas market could limit UNL s ability to have a substantial portion of its assets invested in the Benchmark Futures Contracts. In such a circumstance, UNL could, if it determined it appropriate to do so in light of market conditions and regulatory requirements, invest in other Futures Contracts and/or Other Natural Gas-Related Investments. COMMODITY FUTURES TRADING COMMISSION RISK DISCLOSURE STATEMENT YOU SHOULD CAREFULLY CONSIDER WHETHER YOUR FINANCIAL CONDITION PERMITS YOU TO PARTICIPATE IN A COMMODITY POOL. IN SO DOING, YOU SHOULD BE AWARE THAT COMMODITY INTEREST TRADING CAN QUICKLY LEAD TO LARGE LOSSES AS WELL AS GAINS. SUCH TRADING LOSSES CAN SHARPLY REDUCE THE NET ASSET VALUE OF THE POOL AND CONSEQUENTLY THE VALUE OF YOUR INTEREST IN THE POOL. IN ADDITION, RESTRICTIONS ON REDEMPTIONS MAY AFFECT YOUR ABILITY TO WITHDRAW YOUR PARTICIPATION IN THE POOL. FURTHER, COMMODITY POOLS MAY BE SUBJECT TO SUBSTANTIAL CHARGES FOR MANAGEMENT, AND ADVISORY AND BROKERAGE FEES. IT MAY BE NECESSARY FOR THOSE POOLS THAT ARE SUBJECT TO THESE CHARGES TO MAKE SUBSTANTIAL TRADING PROFITS TO AVOID DEPLETION OR EXHAUSTION OF THEIR ASSETS. THIS DISCLOSURE DOCUMENT CONTAINS A COMPLETE DESCRIPTION OF EACH EXPENSE TO BE CHARGED THIS POOL AT PAGE 7 AND A STATEMENT OF THE PERCENTAGE RETURN NECESSARY TO BREAK EVEN, THAT IS, TO RECOVER THE AMOUNT OF YOUR INITIAL INVESTMENT, AT PAGE 45 . THIS BRIEF STATEMENT CANNOT DISCLOSE ALL THE RISKS AND OTHER FACTORS NECESSARY TO EVALUATE YOUR PARTICIPATION IN THIS COMMODITY POOL. THEREFORE, BEFORE YOU DECIDE TO PARTICIPATE IN THIS COMMODITY POOL, YOU SHOULD CAREFULLY STUDY THIS DISCLOSURE DOCUMENT, INCLUDING A DESCRIPTION OF THE PRINCIPAL RISK FACTORS OF THIS INVESTMENT, AT PAGE 8 . YOU SHOULD ALSO BE AWARE THAT THIS COMMODITY POOL MAY TRADE FOREIGN FUTURES OR OPTIONS CONTRACTS. TRANSACTIONS ON MARKETS LOCATED OUTSIDE THE UNITED STATES, INCLUDING MARKETS FORMALLY LINKED TO A UNITED STATES MARKET, MAY BE SUBJECT TO REGULATIONS WHICH OFFER DIFFERENT OR DIMINISHED PROTECTION TO THE POOL AND ITS PARTICIPANTS. FURTHER, UNITED STATES REGULATORY AUTHORITIES MAY BE UNABLE TO COMPEL THE ENFORCEMENT OF THE RULES OF REGULATORY AUTHORITIES OR MARKETS IN NON-UNITED STATES JURISDICTIONS WHERE TRANSACTIONS FOR THE POOL MAY BE EFFECTED. SWAPS TRANSACTIONS, LIKE OTHER FINANCIAL TRANSACTIONS, INVOLVE A VARIETY OF SIGNIFICANT RISKS. THE SPECIFIC RISKS PRESENTED BY A PARTICULAR SWAP TRANSACTION NECESSARILY DEPEND UPON THE TERMS OF THE TRANSACTION AND YOUR CIRCUMSTANCES. IN GENERAL, HOWEVER, ALL SWAPS TRANSACTIONS INVOLVE SOME COMBINATION OF MARKET RISK, CREDIT RISK, COUNTERPARTY CREDIT RISK, FUNDING RISK, LIQUIDITY RISK, AND OPERATIONAL RISK. HIGHLY CUSTOMIZED SWAPS TRANSACTIONS IN PARTICULAR MAY INCREASE LIQUIDITY RISK, WHICH MAY RESULT IN A SUSPENSION OF REDEMPTIONS. HIGHLY LEVERAGED TRANSACTIONS MAY EXPERIENCE SUBSTANTIAL GAINS OR LOSSES IN VALUE AS A RESULT OF RELATIVELY SMALL CHANGES IN THE VALUE OR LEVEL OF AN UNDERLYING OR RELATED MARKET FACTOR. IN EVALUATING THE RISKS AND CONTRACTUAL OBLIGATIONS ASSOCIATED WITH A PARTICULAR SWAP TRANSACTION, IT IS IMPORTANT TO CONSIDER THAT A SWAP TRANSACTION MAY BE MODIFIED OR TERMINATED ONLY BY MUTUAL CONSENT OF THE ORIGINAL PARTIES AND SUBJECT TO AGREEMENT ON INDIVIDUALLY NEGOTIATED TERMS. THEREFORE, IT MAY NOT BE POSSIBLE FOR THE COMMODITY POOL OPERATOR TO MODIFY, TERMINATE, OR OFFSET THE POOL S OBLIGATIONS OR THE POOL S EXPOSURE TO THE RISKS ASSOCIATED WITH A TRANSACTION PRIOR TO ITS SCHEDULED TERMINATION DATE. Tax Risk UNL is organized and operated as a limited partnership in accordance with the provisions of its limited partnership agreement and applicable state law, and therefore, has a more complex tax treatment than conventional mutual funds. An investment in UNL involves the following tax risks: The daily changes in percentage terms of UNL s shares per share NAV relates directly to daily changes in the average of the prices of the Benchmark Futures Contracts and other assets held by UNL and fluctuations in the prices of these assets could materially adversely affect an investment in UNL s shares. Past performance is not necessarily indicative of future results; all or substantially all of an investment in UNL could be lost. An investor s tax liability may exceed the amount of distributions, if any, on its shares. An investor s allocable share of taxable income or loss may differ from its economic income or loss on its shares. Items of income, gain, deduction, loss and credit with respect to shares could be reallocated, and UNL could be liable for U.S. federal income tax, if the U.S. Internal Revenue Service ("IRS") does not accept the assumptions and conventions applied by UNL in allocating those items, with potential adverse consequences for an investor. UNL could be treated as a corporation for federal income tax purposes, which may substantially reduce the value of the shares. UNL is organized and operated as a limited partnership in accordance with the provisions of the LP Agreement and applicable state law, and therefore, UNL has a more complex tax treatment than traditional mutual funds. If UNL is required to withhold tax with respect to any Non-U.S. shareholders, the cost of such withholding may be borne by all shareholders. The impact of U.S. tax reform on UNL is uncertain. Over-the-Counter ("OTC") Contract Risk UNL may also invest in Other Natural Gas-Related Investments, many of which are negotiated over-the-counter or "OTC" contracts that are not as liquid as Futures Contracts and expose UNL to credit risk that its counterparty may not be able to satisfy its obligations to UNL. An investment in UNL involves the following OTC contract risks: UNL will be subject to credit risk with respect to counterparties to OTC contracts entered into by UNL or held by special purpose or structured vehicles. Valuing OTC derivatives may be less certain than actively traded financial instruments. Other Risks UNL pays fees and expenses that are incurred regardless of whether UNL is profitable. Unlike mutual funds, commodity pools or other investment pools that manage their investments in an attempt to realize income and gains and distribute such income and gains to their investors, UNL generally does not distribute cash to shareholders. You should not invest in UNL if you will need cash distributions from UNL to pay taxes on your share of income and gains of UNL, if any, or for any other reason. You will have no rights to participate in the management of UNL and will have to rely on the duties and judgment of USCF to manage UNL. UNL is subject to actual and potential inherent conflicts involving USCF, various commodity futures brokers and "Authorized Participants," the institutional firms that directly purchase and redeem shares in baskets. USCF s officers, directors and employees do not devote their time exclusively to UNL. USCF s persons are directors, officers or employees of other entities that may compete with UNL for their services, including other commodity pools (funds) that USCF manages. USCF could have a conflict between its responsibilities to UNL and to those other entities. As a result of these and other relationships, parties involved with UNL have a financial incentive to act in a manner other than in the best interests of UNL and the shareholders. In addition, an investment in UNL involves the following other risks: UNL is not leveraged which may impact the investments it makes in order to maintain sufficient liquidity to meet margin and collateral requirements. UNL could become leveraged if it had insufficient assets to completely meet its margin or collateral requirements relating to its investments. UNL may temporarily limit the offering of Creation Baskets. Certain of UNL s investments could be illiquid, which could cause large losses to investors at any time or from time to time. UNL is not actively managed and its investment objective is to track the Benchmark Futures Contracts so that the average daily percentage change in UNL s NAV for any period of 30 successive valuation days will be within plus/minus ten percent (10%) of the average daily percentage change in the price of the Benchmark Futures Contracts over the same period. UNL may not meet the listing standards of NYSE Arca, which would adversely impact an investor s ability to sell shares. The NYSE Arca may halt trading in UNL s shares, which would adversely impact an investor s ability to sell shares. The liquidity of UNL s shares may also be affected by the withdrawal from participation of Authorized Participants, which could adversely affect the market price of the shares. Shareholders that are not Authorized Participants may only purchase or sell their shares in secondary trading markets, and the conditions associated with trading in secondary markets may adversely affect investors investment in the shares. The lack of an active trading market for UNL s shares may result in losses on an investor s investment in UNL at the time the investor sells the shares. Limited partners and shareholders do not participate in the management of UNL and do not control USCF, so they do not have any influence over basic matters that affect UNL. Limited partners may have limited liability in certain circumstances, including potentially having liability for the return of wrongful distributions. USCF s LLC Agreement provides limited authority to the Non-Management Directors, and any Director of USCF may be removed by USCF s parent company, which is wholly owned by Concierge Technologies, Inc., a controlled public company where the majority of shares are owned by Nicholas D. Gerber along with certain of his other family members and certain other shareholders. There is a risk that UNL will not earn trading gains sufficient to compensate for the fees and expenses that it must pay and as such UNL may not earn any profit. UNL is subject to extensive regulatory reporting and compliance. Regulatory changes or actions, including the implementation of new legislation, is impossible to predict but may significantly and adversely affect UNL. UNL is not a registered investment company so shareholders do not have the protections of the 1940 Act. Trading in international markets could expose UNL to credit and regulatory risk. UNL and USCF may have conflicts of interest, which may permit them to favor their own interests to the detriment of shareholders. UNL could terminate at any time and cause the liquidation and potential loss of an investor s investment and could upset the overall maturity and timing of an investor s investment portfolio. UNL does not expect to make cash distributions. An unanticipated number of Redemption Basket requests during a short period of time could have an adverse effect on UNL s NAV. The suspension in the ability of Authorized Participants to purchase Creation Baskets could cause UNL s NAV to differ materially from its trading price. UNL may determine to reinvest the proceeds from sales of its Creation Bask The value of Treasury Bills and Money Market securities held by UNL will fluctuate in value with changes in interest rates. UNL may potentially lose money on its holdings of money market funds. The failure or bankruptcy of a clearing broker or UNL s Custodian could result in a substantial loss of UNL s assets and could impair UNL in its ability to execute trades. The failure or bankruptcy of UNL s Custodian could result in a substantial loss of UNL s assets. Third parties may infringe upon or otherwise violate intellectual property rights or assert that USCF has infringed or otherwise violated their intellectual property rights, which may result in significant costs and diverted attention. Due to the increased use of technologies, intentional and unintentional cyber-attacks pose operational and information security risks. UNL s investment returns could be negatively affected by climate change and greenhouse gas restrictions. USCF is the subject of class action litigation. In light of the inherent uncertainties involved in litigation matters, an adverse outcome in this litigation could materially adversely affect USCF's financial condition. UNL s Fees and Expenses This table describes the fees and expenses that you may pay if you buy and hold shares of UNL. You should note that you may pay brokerage commissions on purchases and sales of UNL s shares, which are not reflected in the table. Authorized Participants will pay applicable creation and redemption fees. See "Creation and Redemption of Shares—Creation and Redemption Transaction Fee," page 72 . Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment) Management Fees(1) 0.75% Other Expenses(1) 1.28% Expense Waiver(2) (1.13)% Net Expenses Excluding Management Fees 0.15% Total Annual Fund Operating Expenses After Fee Waiver 0.90% (1)Based on amounts for the year ended December 31, 2021. The individual expense amounts in dollar terms are shown in the table below. As used in this table, (i) Professional Expenses include expenses for legal, audit, tax, accounting and printing; and (ii) Independent Director and Officer Expenses include amounts paid to independent directors and for officers liability insurance. Management fees $85,770 Professional Expenses $128,233 Brokerage commissions $3,199 Independent Director and Officer Expenses $12,755 License fees $1,716 These amounts are based on UNL s average total net assets, which are the sum of daily total net assets of UNL divided by the number of calendar days in the year. For the year ended December 31, 2021, UNL s average total net assets were $11,436,019 (2)USCF has voluntarily agreed to pay certain expenses typically borne by UNL. USCF has no obligation to continue such payments. If this agreement were terminated, the Annual Fund Operating Expenses could increase, which would negatively impact your total return from an investment in UNL. RISK FACTORS INVOLVED WITH AN INVESTMENT IN UNL You should consider carefully the risks described below before making an investment decision. You should also refer to the other information included in this prospectus, as well as information found in our periodic reports, which include UNL s financial statements and related notes, that are incorporated by reference. See "Incorporation by Reference of Certain Information, " page 75 . UNL s investment objective is for the daily percentage changes in the NAV per share to reflect the daily percentage changes of the spot price of natural gas delivered at the Henry Hub, Louisiana as measured by the daily changes in the average of the prices of 12 futures contracts on natural gas traded on the New York Mercantile Exchange (the "NYMEX"), consisting of the near month contract to expire and the contracts for the following 11 months, for a total of 12 consecutive months contracts, except when the near month contract is within two weeks of expiration, in which case it will be measured by the futures contract that is the next month contract to expire and the contracts for the following 11 consecutive months (the "Benchmark Futures Contracts"), plus interest earned on UNL s collateral holdings, less UNL s expenses. UNL seeks to achieve its investment objective by investing so that the average daily percentage change in UNL s NAV for any period of 30 successive valuation days will be within plus/minus ten percent (10%) of the average daily percentage change in the price of the Benchmark Futures Contracts over the same period. UNL s investment strategy is designed to provide investors with a means of investing indirectly in natural gas and to hedge against movements in the spot price of natural gas. An investment in UNL involves investment risk similar to a direct investment in Natural Gas Interests. An investment in UNL also involves investment risk similar to a direct investment in Futures Contracts and Other Natural Gas-Related Investments, and correlation risk, or the risk that investors purchasing shares to hedge against movements in the price of natural gas will have an efficient hedge only if the price they pay for their shares closely correlates with the price of natural gas. In addition to investment risk and correlation risk, an investment UNL involves tax risks, OTC risks and other risks. Investment Risk The daily changes in percentage terms of UNL s shares per share NAV relates directly to daily changes in the average of the prices of the Benchmark Futures Contracts and other assets held by UNL and fluctuations in the prices of these assets could materially adversely affect an investment in UNL s shares. Past performance is not necessarily indicative of future results; all or substantially all of an investment in UNL could be lost. The net assets of UNL consist primarily of investments in Futures Contracts and, to a lesser extent, in Other Natural Gas-Related Investments. The NAV of UNL s shares relates directly to the value of these assets (less liabilities, including accrued but unpaid expenses), which in turn relates to the price of natural gas in the marketplace. Natural gas prices depend on local, regional and global events or conditions that affect supply and demand for natural gas. Economic conditions impacting natural gas. The demand for natural gas correlates closely with general economic growth rates. The occurrence of recessions or other periods of low or negative economic growth will typically have a direct adverse impact on natural gas demand and therefore may have an adverse impact on natural gas prices. Other factors that affect general economic conditions in the world or in a major region, such as changes in population growth rates, periods of civil unrest, military conflicts, war (such as the current war between Russia and Ukraine), pandemics (e.g. COVID-19), government austerity programs, or currency exchange rate fluctuations, can also impact the demand for natural gas. Sovereign debt downgrades, defaults, inability to access debt markets due to credit or legal constraints, liquidity crises, the breakup or restructuring of fiscal, monetary, or political systems such as the European Union, and other events or conditions (e.g. pandemics such as COVID-19) that impair the functioning of financial markets and institutions also may adversely impact the demand for natural gas. Other natural gas demand-related factors. Other factors that may affect the demand for natural gas and therefore its price, include technological improvements in energy efficiency; seasonal weather patterns, which affect the demand for natural gas associated with heating; increased competitiveness of alternative energy sources that have so far generally not been competitive with natural gas without the benefit of government subsidies or mandates; and changes in technology or consumer preferences that alter fuel choices, such as toward alternative fueled or electric transportation and broad-based changes in personal income level. Other natural gas supply-related factors. Natural gas prices also vary depending on a number of factors affecting supply, including geopolitical risk associated with wars (such as the current war between Russia and Ukraine) , terrorist attacks and tensions between countries, including sanctions imposed as a result of the foregoing that can adversely affect oil and other energy trade flows by limiting or disrupting trade between countries or regions. For example, increased supply from the development of new natural gas sources and technologies to enhance recovery from existing sources tends to reduce natural gas prices to the extent such supply increases are not offset by commensurate growth in demand. Similarly, increases in industry refining or manufacturing capacity may impact the supply of natural gas. Natural gas supply levels can also be affected by factors that reduce available supplies, such as natural disasters, disruptions in competitors operations, or unexpected unavailability of distribution channels that may disrupt supplies. Technological change can also alter the relative costs for companies in the natural gas industry to find, produce, and transport natural gas, which in turn, may affect the supply of and demand for natural gas. Other factors impacting the natural gas market. The supply of and demand for natural gas may also be impacted by changes in interest rates, inflation, and other local or regional market conditions, as well as by the development of alternative energy sources. Price volatility may possibly cause the total loss of your investment. Futures contracts have a high degree of price variability and are subject to occasional rapid and substantial changes. Consequently, you could lose all or substantially all of your investment in UNL. Significant market volatility has recently occurred in the natural gas markets and the natural gas futures markets. Such volatility is attributable in part to the COVID-19 pandemic, related supply chain disruptions, war , including the war between Russian and Ukraine, and continuing disputes among natural gas-producing countries. These factors could cause continuing or increased volatility in the future, which may affect the value, pricing and liquidity of some investments or other assets, including those held by or invested in by UNL and the impact of which could limit UNL s ability to have a substantial portion of its assets invested in the Benchmark Futures Contracts . In such a circumstance, UNL could, if it determined it appropriate to do so in light of market conditions and regulatory requirements, invest in other Futures Contract and/or Other Natural-Gas Related Investments. Russia s invasion of Ukraine, and sanctions brought by the United States and other countries against Russia, have caused disruptions in many business sectors , resulting in significant market disruptions and that may lead to increased volatility in the price of certain commodities, including oil and natural gas , as well as volatility in UNL's NAV or share price . On February 24, 2022, Russia launched a large-scale invasion of Ukraine. The extent and duration of the military action, resulting sanctions and future market or supply disruptions in the region are impossible to predict, but could be significant and may have a severe adverse effect on the region. The United States and other countries and certain international organizations have imposed broad-ranging economic sanctions on Russia and certain Russian individuals, banking entities and corporations as a response to Russia s invasion of Ukraine. On March 8, 2022, the United States announced that it would ban imports of oil, natural gas and coal from Russia. Among other things, the extent and duration of the military action, the responses of countries and political bodies to Russia's actions, including sanctions, future market or supply disruptions, and Ukraine's military response and the potential for wider conflict may increase financial market volatility generally, have severe adverse effects on regional and global economic markets, and cause volatility in the markets for commodities including the price of energy, including energy futures, and the NAV or share price of UNL. These events illustrate the dynamics of natural gas prices. USCF believes that the war in Ukraine has raised concerns among investors that a global natural gas supply shortage is possible, particularly if Russia reduces or cuts supply to Europe. Natural gas prices in the United States have historically been driven by domestic supply and demand. In recent years, natural gas exports have increased, including liquid natural gas (LNG) exported to Europe. Rising international demand has had, and will continue to have, a growing impact on natural gas prices in the United States. Domestic supply and demand are likely to remain the dominant influence on prices, while extraordinary international events will have a growing influence on volatility and price direction at times. Many European countries have historically relied on imports of natural gas from Russia and, while only a limited number of European countries have embargoed Russian natural gas to date, the March 8, 2022 announcement by the U.S., the embargoes that have taken place, and the possibility that there will be additional embargoes, has had an impact on the spot price of natural gas and the value of the Benchmark Futures Contract. Future embargoes or damage to the pipelines that carry natural gas in Ukraine could result in additional price increases as well as increased volatility. Long term impacts resulting from occurrences such as sanctions, shipping disruptions, collateral war damage, and a potential expansion of the conflict between Russia and Ukraine could further disrupt the supply of energy, particularly natural gas, because Russia is a primary supplier of natural gas to Europe. Volatility, trading volumes, and prices in global natural gas markets have risen dramatically and are expected to continue indefinitely at current elevated levels. A rapid peaceful resolution to the war in Ukraine also could impact the markets for certain commodities, such as oil and natural gas, and may have collateral impacts, including increased volatility, and cause disruptions to availability of certain commodities, commodity and futures prices and the supply chain globally. The longer-term impact on commodities and futures prices, including the spot price of natural gas and the price of the Benchmark Futures Contract is difficult to predict and depends on a number of factors that may have a negative impact on UNL in the future. COVID-19 and other infectious disease outbreaks could negatively affect the valuation and performance of UNL s investments. An outbreak of infectious respiratory illness caused by a novel coronavirus known as COVID-19 was first detected in China in December 2019 and has spread globally. In March 2020, the World Health Organization declared the COVID-19 outbreak a pandemic. COVID-19 has resulted in numerous deaths, travel restrictions, closed international borders, enhanced health screenings at ports of entry and elsewhere, disruption of and delays in healthcare service preparation and delivery, prolonged quarantines and the imposition of both local and more widespread "work from home" measures, cancellations, loss of employment, supply chain disruptions, and lower consumer and institutional demand for goods and services, as well as general concern and uncertainty. The ongoing spread of COVID-19 has had, and may continue to have, a material adverse impact on local economies in the affected jurisdictions and also on the global economy, as cross border commercial activity and market sentiment are impacted by the outbreak and government and other measures seeking to contain its spread. The impact of COVID-19, and other infectious disease outbreaks that may arise in the future, could adversely affect individual issuers and capital markets in ways that cannot necessarily be foreseen. In addition, actions taken by government and quasi-governmental authorities and regulators throughout the world in response to the COVID-19 outbreak, including significant fiscal and monetary policy changes, may affect the value, volatility, pricing and liquidity of some investments or other assets, including those held by or invested in by UNL. Public health crises caused by the COVID-19 outbreak may exacerbate other pre-existing political, social and economic risks in certain countries or globally. The duration of the COVID-19 outbreak and its ultimate impact on UNL and, on the global economy, cannot be determined with certainty. Historical performance of UNL and the Benchmark Futures Contracts is not indicative of future performance. Past performance of UNL or the Benchmark Futures Contracts is not necessarily indicative of future results. Therefore, past performance of UNL or the Benchmark Futures Contracts should not be relied upon in deciding whether to buy shares of UNL. Correlation Risk An investment in UNL may provide little or no diversification benefits. Thus, in a declining market, UNL may have no gains to offset losses from other investments, and an investor may suffer losses on an investment in UNL while incurring losses with respect to other asset classes. Investors purchasing shares to hedge against movements in the price of natural gas will have an efficient hedge only if the price investors pay for their shares closely correlates with the price of natural gas. Investing in UNL s shares for hedging purposes involves the following risks: The market price at which the investor buys or sells shares may be significantly less or more than NAV. Daily percentage changes in NAV may not closely correlate with daily percentage changes in the average of the prices of the Benchmark Futures Contracts. Daily percentage changes in the average of the prices of the Benchmark Futures Contracts may not closely correlate with daily percentage changes in the price of natural gas. Historically, Futures Contracts and Other Natural Gas-Related Investments have generally been non-correlated to the performance of other asset classes such as stocks and bonds. Non-correlation means that there is a low statistically valid relationship between the performance of futures and other commodity interest transactions, on the one hand, and stocks or bonds, on the other hand. However, there can be no assurance that such non-correlation will continue during future periods. If, contrary to historic patterns, UNL s performance were to move in the same general direction as the financial markets, investors will obtain little or no diversification benefits from an investment in UNL s shares. In such a case, UNL may have no gains to offset losses from other investments, and investors may suffer losses on their investment in UNL at the same time they incur losses with respect to other investments. Variables such as drought, floods, weather, military conflicts, pandemics (such as COVID-19), embargoes, tariffs and other political events may have a larger impact on natural gas prices and natural gas-linked instruments, including Futures Contracts and Other Natural Gas-Related Investments, than on traditional securities. These additional variables may create additional investment risks that subject UNL s investments to greater volatility than investments in traditional securities. Non-correlation should not be confused with negative correlation, where the performance of two asset classes would be opposite of each other. There is no historical evidence that the spot price of natural gas and prices of other financial assets, such as stocks and bonds, are negatively correlated. In the absence of negative correlation, UNL cannot be expected to be automatically profitable during unfavorable periods for the stock market, or vice versa. The market price at which investors buy or sell shares may be significantly less or more than NAV. UNL s NAV per share will change throughout the day as fluctuations occur in the market value of UNL s portfolio investments. The public trading price at which an investor buys or sells shares during the day from their broker may be different from the NAV of the shares, which is also the price shares can be redeemed with UNL by Authorized Participants in Redemption Baskets. Generally, price differences may relate to supply and demand forces at work in the secondary trading market for shares that are closely related to, but not identical to, the same forces influencing the prices of natural gas and the Benchmark Futures Contracts at any point in time. USCF expects that exploitation of certain arbitrage opportunities by Authorized Participants and their clients will tend to cause the public trading price to track NAV per share closely over time, but there can be no assurance of that. For example, a shortage of UNL shares in the market and other factors could cause UNL s shares to trade at a premium. Investors should be aware that such premiums can be transitory. To the extent an investor purchases shares that include a premium (e.g., because of a shortage of shares in the market due to the inability of Authorized Participants to purchase additional shares from UNL that could be resold into the market) and the cause of the premium no longer exists causing the premium to disappear (e.g., because more shares are available for purchase from UNL by Authorized Participants that could be resold into the market) such investor s return on its investment would be adversely impacted due to the loss of the premium. The NAV of UNL s shares may also be influenced by non-concurrent trading hours between the NYSE Arca and the various futures exchanges on which natural gas is traded. While the shares trade on the NYSE Arca from 9:30 a.m. to 4:00 p.m. Eastern Time, the trading hours for the futures exchanges on which natural gas trades may not necessarily coincide during all of this time. For example, while the shares trade on the NYSE Arca until 4:00 p.m. Eastern Time, liquidity in the natural gas market will be reduced after the close of the NYMEX at 2:30 p.m. Eastern Time. UNL s NAV is calculated based on the settlement price of the Benchmark Futures Contracts at 2:30 p.m. Eastern Time and the closing share price of UNL on the NYSE Arca taking into account changes in the price of the Benchmark Futures Contracts that occur after the settlement price is determined. As a result, during periods when the NYSE Arca is open and the futures exchanges on which natural gas is traded are closed, trading spreads and the resulting premium or discount on the shares may widen and, therefore, increase the difference between the price of the shares and the NAV of the shares. Daily percentage changes in UNL s NAV may not correlate with daily percentage changes in the average of the prices of the Benchmark Futures Contracts. It is possible that the daily percentage changes in UNL s NAV per share may not closely correlate to daily percentage changes in the average of the prices of the Benchmark Futures Contracts. Non-correlation may be attributable to disruptions in the market for natural gas, the imposition of position or accountability limits by regulators or exchanges, or other extraordinary circumstances. As UNL approaches or reaches position limits with respect to the Benchmark Futures Contracts and other Futures Contracts or in view of market conditions, UNL may begin investing in Other Natural Gas-Related Investments. In addition, UNL is not able to replicate exactly the changes in the price of the Benchmark Futures Contracts because the total return generated by UNL is reduced by expenses and transaction costs, including those incurred in connection with UNL s trading activities, and increased by interest income from UNL s holdings of Treasuries (defined below). Tracking the Benchmark Futures Contracts requires trading of UNL s portfolio with a view to tracking the Benchmark Futures Contracts over time and is dependent upon the skills of USCF and its trading principals, among other factors. Daily percentage changes in the prices of the Benchmark Futures Contracts may not correlate with daily percentage changes in the spot price of natural gas. The correlation between changes in prices of the Benchmark Futures Contracts and the spot price of natural gas may at times be only approximate. The degree of imperfection of correlation depends upon circumstances such as variations in the speculative natural gas market, supply of and demand for Futures Contracts (including the Benchmark Futures Contracts) and Other Natural Gas-Related Investments, and technical influences in natural gas futures trading. An investment in UNL is not a proxy for investing in the natural gas markets, and the daily percentage changes in the price of the Benchmark Futures Contracts, or the NAV of UNL, may not correlate with daily percentage changes in the spot price of natural gas. An investment in UNL is not a proxy for investing in the natural gas markets. To the extent that investors use UNL as a means of indirectly investing in natural gas, there is the risk that the daily changes in the price of UNL s shares on the NYSE Arca, on a percentage basis, will not closely track the daily changes in the spot price of natural gas on a percentage basis. This could happen if the price of shares traded on the NYSE Arca does not correlate closely with the value of UNL s NAV; the changes in UNL s NAV do not correlate closely with the changes in the price of the Benchmark Futures Contracts; or the changes in the price of the Benchmark Futures Contracts do not closely correlate with the changes in the cash or spot price of natural gas. This is a risk because if these correlations do not exist, then investors may not be able to use UNL as a cost-effective way to indirectly invest in natural gas or as a hedge against the risk of loss in natural gas-related transactions. The degree of correlation among UNL s share price, the price of the Benchmark Futures Contracts and the spot price of natural gas depends upon circumstances such as variations in the speculative natural gas market, supply of and demand for Futures Contracts (including the Benchmark Futures Contracts) and Other Natural Gas-Related Investments, and technical influences on trading natural gas futures contracts. Investors who are not experienced in investing in natural gas futures contracts or the factors that influence that market or speculative trading in the natural gas markets and may not have the background or ready access to the types of information that investors familiar with these markets may have and, as a result, may be at greater risk of incurring losses from trading in UNL shares than such other investors with such experience and resources. Natural forces in the natural gas futures market known as "backwardation" and "contango" may increase UNL s tracking error and/or negatively impact total return. UNL s Benchmark Futures Contracts consist of the near month contract to expire and the futures contracts for the 11 following months, until the near month contract is within two weeks of expiration, at which time the Benchmark Futures Contracts are changed over a one day period to consist of the next month contract to expire and the 11 following months of futures contracts. In the event of a natural gas futures market where near month contracts trade at a higher price than next month to expire contracts, a situation described as "backwardation" in the futures market, then absent the impact of the overall movement in natural gas prices the value of the Benchmark Futures Contracts would tend to rise as it approaches expiration. Conversely, in the event of a natural gas futures market where near month contracts trade at a lower price than next month contracts, a situation described as "contango" in the futures market, then absent the impact of the overall movement in natural gas prices the value of the benchmark contracts would tend to decline as it approaches expiration. When compared to total return of other price indices, such as the spot price of natural gas, the impact of backwardation and contango may cause the total return of UNL s per share NAV to vary significantly. Moreover, absent the impact of rising or falling natural gas prices, a prolonged period of contango could have a significant negative impact on UNL s per share NAV and total return and investors could lose part or all of their investment. See "Additional Information About UNL, its Investment Objective and Investments" for a discussion of the potential effects of contango and backwardation. While contango and backwardation are consistently present in trading in the futures markets, such conditions can be exacerbated by market forces. For example, extraordinary market conditions in the crude oil markets, including "super contango" (a higher level of contango arising from the overabundance of oil being produced and the limited availability of storage for such excess supply), occurred in the crude oil futures markets in April 2020 due to over-supply of crude oil in the face of weak demand during the COVID-19 pandemic when disputes among oil-producing countries regarding limitations on the production of oil also were occurring. This resulted in a negative price for the May 2020 futures contract on light sweet crude oil as traded on the New York Mercantile Exchange. Volatility in the natural gas market was also elevated, but it did not reach the same extreme levels as the volatility in the oil futures market did. However, increased volatility in the future could limit UNL s ability to have a substantial portion of its assets invested in the Benchmark Futures Contracts. In addition, it is possible that the Benchmark Futures Contracts may experience periods of super contango or negative prices in the future. In any such circumstance, UNL could, if it determined it appropriate to do so in light of market conditions and regulatory requirements, invest in other Futures Contracts and/or Other Natural Gas-Related Investments. UNL s NAV and share price are generally highly correlated with the price of the Benchmark Futures Contract and Natural Gas Futures Contracts in months for nearby delivery and, therefore, would typically move in the same direction. The Russian invasion of Ukraine and related developments have placed upward pressure on the price of the Benchmark Futures Contract. As a result, UNL is currently in a period of backwardation. There can be no assurance that the current period of backwardation, and its impact on the performance of UNL, will continue, nor is it possible to predict how long backwardation may continue. See "Additional Information About UNL, its Investment Objective and Investments" for a discussion of the potential effects of contango and backwardation. Accountability levels, position limits, and daily price fluctuation limits set by the exchanges have the potential to cause tracking error, by limiting UNL s investments, including its ability to fully invest in the Benchmark Futures Contracts, which could cause the price of shares to substantially vary from the price of the Benchmark Futures Contracts. Designated contract markets, such as the NYMEX and ICE Futures, have established accountability levels and position limits on the maximum net long or net short futures contracts in commodity interests that any person or group of persons under common trading control (other than as a hedge, which an investment by UNL is not) may hold, own or control. These levels and position limits apply to the futures contracts that UNL invests in to meet its investment objective. In addition to accountability levels and position limits, the NYMEX and ICE Futures also set daily price fluctuation limits on futures contracts. The daily price fluctuation limit establishes the maximum amount that the price of a futures contract may vary either up or down from the previous day s settlement price. Once the daily price fluctuation limit has been reached in a particular futures contract, no trades may be made at a price beyond that limit. The accountability levels for the Benchmark Futures Contracts and other Futures Contracts traded on U.S.-based futures exchanges, such as the NYMEX, are not a fixed ceiling, but rather a threshold above which the NYMEX may exercise greater scrutiny and control over an investor s positions. The current accountability level for investments for any one-month in the Benchmark Futures Contracts is 6,000 contracts. In addition, the NYMEX imposes an accountability level for all months of 12,000 net futures contracts for natural gas. In addition, the ICE Futures maintains the same accountability levels, position limits and monitoring authority for its natural gas contract as the NYMEX. If UNL and the Related Public Funds exceed these accountability levels for investments in the futures contracts for natural gas, the NYMEX and ICE Futures will monitor such exposure and may ask for further information on their activities, including the total size of all positions, investment and trading strategy, and the extent of liquidity resources of UNL and the Related Public Funds. If deemed necessary by the NYMEX and/or ICE Futures, UNL could be ordered to reduce its Natural Gas NG Futures Contracts to below the 6,000 single month and/or 12,000 all month accountability level. Position limits differ from accountability levels in that they represent fixed limits on the maximum number of futures contracts that any person may hold and cannot be exceeded without express CFTC authority to do so. In addition to accountability levels and position limits that may apply at any time, the NYMEX and the ICE Futures impose position limits on contracts held in the last few days of trading in the near month contract to expire. It is unlikely that UNL will run up against such position limits because UNL s investment strategy is to close out its positions and "roll" from the near month contracts to expire to the next month contracts during a one day period beginning two weeks from expiration of the contracts. On October 15, 2020, the CFTC approved the Position Limits Rule. The Position Limits Rule establishes federal position limits for 25 core referenced futures contracts (comprised of agricultural, energy and metals futures contracts), futures and options linked to the core referenced futures contracts, and swaps that are economically equivalent to the core referenced futures contracts. The Benchmark Futures Contracts will be subject to position limits under the Position Limits Rule, and UNL s trading does not qualify for an exemption therefrom. Accordingly, the Position Limits Rule could negatively impact the ability of UNL to meet its investment objective by inhibiting USCF s ability to effectively invest the proceeds from sales of Creation Baskets of UNL in particular amounts and types of its permitted investments. Risk mitigation measures that could be imposed by UNL s futures commission merchants ("FCMs") have the potential to cause tracking error by limiting UNL s investments, including its ability to fully invest in the Benchmark Futures Contracts and other Futures Contracts, which could cause the price of UNL s shares to substantially vary from the price of the Benchmark Futures Contracts. UNL s FCMs have discretion to impose limits on the positions that UNL may hold in the Benchmark Futures Contracts. To date, UNL s FCMs have not imposed any such limits. However, were UNL s FCMs to impose limits, UNL s ability to have a substantial portion of its assets invested in the Benchmark Futures Contracts and other Futures Contracts could be severely limited, which could lead UNL to invest in other Futures Contracts or, potentially, Other Natural Gas-Related Investments. UNL could also have to more frequently rebalance and adjust the types of holdings in its portfolio than is currently the case. This could inhibit UNL from pursuing its investment objective in the same manner that it has historically and currently. In addition, when offering Creation Baskets for purchase, limitations imposed by exchanges and/or any of UNL s FCMs could limit UNL s ability to invest the proceeds of the purchases of Creation Baskets in Benchmark Futures Contracts and other Futures Contracts. If this were the case, UNL may invest in other permitted investments, including Other Natural Gas-Related Investments, and may hold larger amounts of Treasuries, cash and cash equivalents, which could impair UNL s ability to meet its investment objective. Tax Risk An investor s tax liability may exceed the amount of distributions, if any, on its shares. Cash or property will be distributed at the sole discretion of USCF. USCF has not and does not currently intend to make cash or other distributions with respect to shares. Investors will be required to pay U.S. federal income tax and, in some cases, state, local, or foreign income tax, on their allocable share of UNL s taxable income, without regard to whether they receive distributions or the amount of any distributions. Therefore, the tax liability of an investor with respect to its shares may exceed the amount of cash or value of property (if any) distributed with respect to such shares. An investor s allocable share of taxable income or loss may differ from its economic income or loss on its shares. Due to the application of the assumptions and conventions applied by UNL in making allocations for tax purposes and other factors, an investor s allocable share of UNL s income, gain, deduction or loss may be different than its economic profit or loss from its shares for a taxable year. This difference could be temporary or permanent and, if permanent, could result in it being taxed on amounts in excess of its economic income. Items of income, gain, deduction, loss and credit with respect to shares could be reallocated, and UNL could be liable for U.S. federal income tax, if the U.S. Internal Revenue Service ("IRS") does not accept the assumptions and conventions applied by UNL in allocating those items, with potential adverse consequences for an investor. The U.S. federal income tax rules pertaining to partnerships are complex and their application to large, publicly traded partnerships such as UNL is in many respects uncertain. UNL applies certain assumptions and conventions in an attempt to comply with the intent of the applicable rules and to report taxable income, gains, deductions, losses and credits in a manner that properly reflects shareholders economic gains and losses. It is possible that the IRS could successfully challenge the application by UNL of these assumptions and conventions as not fully complying with all aspects of the Internal Revenue Code of 1986, as amended (the "Code"), and applicable Treasury Regulations, which would require UNL to reallocate items of income, gain, deduction, loss or credit in a manner that adversely affects investors. UNL may be liable for U.S. federal income tax on any "imputed understatement" resulting from an adjustment as a result of an IRS audit. The amount of the imputed understatement generally includes increases in allocations of items of income or gain to any investor and decreases in allocations of items of deduction, loss, or credit to any investor without any offset for corresponding reductions in allocations of items of income or gain to any investor or increases in allocations of items of deduction, loss, or credit to any investor. If UNL is required to pay any U.S. federal income taxes on any imputed understatement, the resulting tax liability would reduce the net assets of UNL and would likely have an adverse impact on the value of the shares. Under certain circumstances, UNL may be eligible to make an election to cause the investors to take into account the amount of any imputed understatement, including any associated interest and penalties. The ability of a publicly traded partnership such as UNL to make this election is uncertain. If the election is made, UNL would be required to provide investors who owned beneficial interests in the shares in the year to which the adjusted allocations relate with a statement setting forth their proportionate shares of the adjustment ("Adjusted K-1s"). The investors would be required to take the adjustment into account in the taxable year in which the Adjusted K-1s are issued. UNL could be treated as a corporation for U.S. federal income tax purposes, which may substantially reduce the value of the shares. UNL has received an opinion of counsel that, under current U.S. federal income tax laws, UNL will be treated as a partnership that is not taxable as a corporation for U.S. federal income tax purposes, provided that (i) at least 90 percent of UNL s annual gross income will be derived from (a) income and gains from commodities (not held as inventory) or futures, forwards, options, swaps and other notional principal contracts with respect to commodities, and (b) interest income, (ii) UNL is organized and operated in accordance with its governing agreements and applicable law and (iii) UNL does not elect to be taxed as a corporation for U.S. federal income tax purposes. Although USCF anticipates that UNL has satisfied and will continue to satisfy the "qualifying income" requirement for all taxable years, that result cannot be assured. UNL has not requested and will not request any ruling from the IRS with respect to its classification as a partnership not taxable as a corporation for U.S. federal income tax purposes. If the IRS were to successfully assert that UNL is taxable as a corporation for U.S. federal income tax purposes in any taxable year, rather than passing through its income, gains, losses and deductions proportionately to shareholders, UNL would be subject to U.S. federal income tax on its net income for the year at corporate tax rates. In addition, although UNL does not currently intend to make distributions with respect to shares, if UNL were taxable as a corporation for U.S. federal income tax purposes, any distributions made with respect to the UNL shares would be taxable to shareholders as dividend income to the extent of UNL s current and accumulated earnings and profits. Taxation of UNL as a corporation could materially reduce the after-tax return on an investment in shares and could substantially reduce the value of the shares. UNL is organized and operated as a limited partnership in accordance with the provisions of the LP Agreement and applicable state law, and therefore, UNL has a more complex tax treatment than traditional mutual funds. UNL is organized and operated as a limited partnership in accordance with the provisions of the LP Agreement and applicable state law. No U.S. federal income tax is paid by UNL on its income. Instead, UNL will furnish shareholders each year with tax information on IRS Schedule K-1 (Form 1065) and each U.S. shareholder is required to report on its U.S. federal income tax return its allocable share of the income, gain, loss and deduction of UNL. This must be reported without regard to the amount (if any) of cash or property the shareholder receives as a distribution from UNL during the taxable year. A shareholder, therefore, may be allocated income or gain by UNL but receive no cash distribution with which to pay the tax liability resulting from the allocation, or may receive a distribution that is insufficient to pay such liability. In addition to U.S. federal income taxes, shareholders may be subject to other taxes, such as state and local income taxes, unincorporated business taxes, business franchise taxes and estate, inheritance or intangible taxes that may be imposed by the various jurisdictions in which UNL does business or owns property or where the shareholders reside. Although an analysis of those various taxes is not presented here, each prospective shareholder should consider their potential impact on its investment in UNL. It is each shareholder s responsibility to file the appropriate U.S. federal, state, local and foreign tax returns. If UNL is required to withhold tax with respect to any Non-U.S. shareholders, the cost of such withholding may be borne by all shareholders. Under certain circumstances, UNL may be required to pay withholding tax with respect to allocations to Non-U.S. shareholders. Although the LP Agreement provides that any such withholding will be treated as being distributed to the Non-U.S. shareholder, UNL may not be able to cause the economic cost of such withholding to be borne by the Non-U.S. shareholder on whose behalf such amounts were withheld since it does not generally expect to make any distributions. Under such circumstances, the economic cost of the withholding may be borne by all shareholders, not just the shareholders on whose behalf such amounts were withheld. This could have a material impact on the value of the shares. The impact of U.S. tax reform on UNL is uncertain. Legislative or other actions relating to taxes could have a negative effect on UNL or our investors. The rules dealing with U.S. federal income taxation are constantly under review by persons involved in the legislative process and by the IRS and the U.S. Treasury Department. The Biden Administration has proposed significant changes to the existing U.S. tax rules, and there are a number of proposals in Congress that would similarly modify the existing U.S. tax rules. The likelihood of any such legislation being enacted is uncertain, and we cannot predict with certainty how any changes in the tax laws might affect UNL, our investors or our investments. Investors are urged to consult with their tax advisor with respect to the status of legislative, regulatory or administrative developments and proposals and their potential effect on an investment in our shares. OTC Contract Risk UNL will be subject to credit risk with respect to counterparties to OTC contracts entered into by UNL or held by special purpose or structured vehicles. UNL faces the risk of non-performance by the counterparties to the OTC contracts. Unlike in futures contracts, the counterparty to these contracts is generally a single bank or other financial institution, rather than a clearing organization backed by a group of financial institutions. As a result, there will be greater counterparty credit risk in these transactions. A counterparty may not be able to meet its obligations to UNL, in which case UNL could suffer significant losses on these contracts. If a counterparty becomes bankrupt or otherwise fails to perform its obligations due to financial difficulties, UNL may experience significant delays in obtaining any recovery in a bankruptcy or other reorganization proceeding. UNL may obtain only limited recovery or may obtain no recovery in such circumstances. UNL has sought to mitigate these risks by typically entering into transactions only with major, global financial institutions. In addition, two-way margining requirements imposed by U.S. regulators also mitigate such risks. Valuing OTC derivatives may be less certain than actively traded financial instruments. In general, valuing OTC derivatives is less certain than valuing actively traded financial instruments such as exchange traded futures contracts and securities or cleared swaps because, for OTC derivatives, the price and terms on which such OTC derivatives are entered into or can be terminated are individually negotiated, and those prices and terms may not reflect the best price or terms available from other sources. In addition, while market makers and dealers generally quote indicative prices or terms for entering into or terminating OTC contracts, they typically are not contractually obligated to do so, particularly if they are not a party to the transaction. As a result, it may be difficult to obtain an independent value for an outstanding OTC derivatives transaction. Other Risks UNL is not leveraged which may impact the investments it makes in order to maintain sufficient liquidity to meet margin and collateral requirements. UNL has not leveraged, and does not intend to leverage, its assets through borrowings or otherwise, and makes its investments accordingly. Consistent with the foregoing, UNL s announced investment intentions, and any changes thereto, will take into account the need for UNL to make permitted investments that also allow it to maintain adequate liquidity to meet its margin and collateral requirements and to avoid, to the extent reasonably possible, UNL becoming leveraged. If market conditions require it, UNL may implement risk reduction procedures, which may include changes to UNL s investments, and such changes may occur on short notice if they occur other than during a roll or rebalance period. UNL could become leveraged if it had insufficient assets to completely meet its margin or collateral requirements relating to its investments. Although UNL does not and will not borrow money or use debt to satisfy its margin or collateral obligations in respect of its investments, it could become leveraged if UNL were to hold insufficient assets that would allow it to meet not only the current, but also future, margin or collateral obligations required for such investments. Such a circumstance could occur if UNL were to hold assets that have a value of less than zero. USCF endeavors to have the value of UNL s Treasuries, cash and cash equivalents, whether held by UNL or posted as margin or other collateral, at all times approximate the aggregate market value of its obligations under its Futures Contracts and Other Natural Gas-Related Investments. Although permitted to do so under its Limited Partnership Agreement, UNL has not and does not intend to leverage its assets by making investments beyond its potential ability to meet the potential margin and collateral obligations relating to such investments. Consistent with this, UNL s investment decisions will take into account the need for UNL to make permitted investments that also allow it to maintain adequate liquidity to meet its margin and collateral requirements and to avoid, to the extent reasonably possible, UNL becoming leveraged, including by its holding of assets that have a high probability of having a value of less than zero. UNL may temporarily limit the offering of Creation Baskets. UNL may determine to limit the issuance of its shares through the offering of Creation Baskets to its Authorized Participants in order to allow it to reinvest the proceeds from sales of its Creation Baskets in currently permitted assets in a manner that meets its investment objective. UNL will announce to the market through the filing of a Current Report on Form 8-K if it intends to limit the offering of Creation Baskets at any time. In such case, orders for Creation Baskets will be considered for acceptance in the order they are received by UNL and UNL would continue to accept requests for redemption of its shares from Authorized Participants through Redemption Baskets during the period of the limited offering of Creation Baskets. Certain of UNL s investments could be illiquid, which could cause large losses to investors at any time or from time to time. Futures positions cannot always be liquidated at the desired price. It is difficult to execute a trade at a specific price when there is a relatively small volume of buy and sell orders in a market. A market disruption, such as a war or a foreign government taking political actions that disrupt the market for its currency, its natural gas production or exports, or another major export, can also make it difficult to liquidate a position. Because both Futures Contracts and Other Natural Gas-Related Investments may be illiquid, UNL s Natural Gas Interests may be more difficult to liquidate at favorable prices in periods of illiquid markets and losses may be incurred during the period in which positions are being liquidated. The large size of the positions that UNL may acquire increases the risk of illiquidity both by making its positions more difficult to liquidate and by potentially increasing losses while trying to do so. OTC contracts that are not subject to clearing may be even less marketable than futures contracts because they are not traded on an exchange, do not have uniform terms and conditions, and are entered into based upon the creditworthiness of the parties and the availability of credit support, such as collateral, and in general, they are not transferable without the consent of the counterparty. These conditions make such contracts less liquid than standardized futures contracts traded on a commodities exchange and could adversely impact UNL s ability to realize the full value of such contracts. In addition, even if collateral is used to reduce counterparty credit risk, sudden changes in the value of OTC transactions may leave a party open to financial risk due to a counterparty default since the collateral held may not cover a party s exposure on the transaction in such situations. UNL is not actively managed and its investment objective is to track the Benchmark Futures Contracts so that the average daily percentage change in UNL s NAV for any period of 30 successive valuation days will be within plus/minus ten percent (10%) of the average daily percentage change in the price of the Benchmark Futures Contracts over the same period. UNL is not actively managed by conventional methods. Accordingly, if UNL s investments in Natural Gas Interests are declining in value, in the ordinary course, UNL will not close out such positions except in connection with paying the proceeds to an Authorized Participant upon the redemption of a basket or closing out its positions in Futures Contracts and other permitted investments (i) in connection with the monthly change in the Benchmark Futures Contracts or when UNL otherwise determines it would be appropriate to do so, e.g., due to regulatory requirements or risk mitigation measures, or to avoid UNL becoming leveraged, and it reinvests the proceeds in new Futures Contracts or Other Natural Gas-Related Investments to the extent possible. USCF will seek to cause the NAV of UNL s shares to track the Benchmark Futures Contracts during periods in which its price is flat or declining as well as when the price is rising. UNL s ability to invest in the Benchmark Futures Contracts could be limited as a result of any or all of the following: evolving market conditions, a change in regulatory accountability levels and position limits imposed on UNL with respect to its investment in Futures Contracts, additional or different mitigation measures taken by market participants, generally, including UNL, with respect to UNL acquiring additional Futures Contracts, or UNL selling additional shares. UNL may not meet the listing standards of NYSE Arca, which would adversely impact an investor s ability to sell shares. UNL s shares are listed for trading on the NYSE Arca under the market symbol "UNL." NYSE Arca may suspend UNL s shares from trading on the exchange with or without prior notice to UNL, upon failure of UNL to comply with the NYSE s listing requirements, or when in its sole discretion, the NYSE Arca determines that such suspension of dealings is in the public interest or otherwise warranted. There can be no assurance that the requirements necessary to maintain the listing of UNL s shares will continue to be met or will remain unchanged. If UNL were unable to meet the NYSE s listing standards and were to become delisted, an investor s ability to sell its shares would be adversely impacted. The NYSE Arca may halt trading in UNL s shares, which would adversely impact an investor s ability to sell shares. Trading in shares may be halted due to market conditions or, in light of NYSE Arca rules and procedures, for reasons that, in the view of the NYSE Arca, make trading in shares inadvisable. In addition, trading is subject to trading halts caused by extraordinary market volatility pursuant to "circuit breaker" rules that require trading to be halted for a specified period based on a specified market decline. The liquidity of UNL s shares may also be affected by the withdrawal from participation of Authorized Participants, which could adversely affect the market price of the shares. In the event that one or more Authorized Participants which have substantial interests in the shares withdraw from participation, the liquidity of the shares will likely decrease, which could adversely affect the market price of the shares and result in investors incurring a loss on their investment. Shareholders that are not Authorized Participants may only purchase or sell their shares in secondary trading markets, and the conditions associated with trading in secondary markets may adversely affect investors investment in the shares. Only Authorized Participants may directly purchase shares from, or redeem shares with, UNL through Creation Baskets or Redemption Baskets respectively. All other investors that desire to purchase or sell shares must do so through the NYSE Arca or in other markets, if any, in which the shares may be traded. Shares may trade at a premium or discount relative to NAV per share. The lack of an active trading market for UNL s shares may result in losses on an investor s investment in UNL at the time the investor sells the shares. Although UNL s shares are listed and traded on the NYSE Arca, there can be no guarantee that an active trading market for the shares will be maintained. If an investor needs to sell shares at a time when no active trading market for them exists, the price the investor receives upon sale of the shares, assuming they were able to be sold, likely would be lower than if an active market existed. Limited partners and shareholders do not participate in the management of UNL and do not control USCF, so they do not have any influence over basic matters that affect UNL. The limited partners and shareholders take no part in the management or control, and have a minimal voice in UNL s operations or business. Limited partners and shareholders must therefore rely upon the duties and judgment of USCF to manage UNL s affairs. Limited partners and shareholders have no right to elect USCF on an annual or any other continuing basis. If USCF voluntarily withdraws, however, the holders of a majority of UNL s outstanding shares (excluding for purposes of such determination shares owned, if any, by the withdrawing general partner and its affiliates) may elect its successor. USCF may not be removed as general partner except upon approval by the affirmative vote of the holders of at least 66 2/3 percent of UNL s outstanding shares (excluding shares, if any, owned by USCF and its affiliates), subject to the satisfaction of certain conditions set forth in the LP Agreement. Limited partners may have limited liability in certain circumstances, including potentially having liability for the return of wrongful distributions. Under Delaware law, a limited partner might be held liable for UNL s obligations as if it were a general partner if the limited partner participates in the control of the partnership s business and the persons who transact business with the partnership think the limited partner is the general partner. A limited partner will not be liable for assessments in addition to its initial capital investment in any of UNL s shares. However, a limited partner may be required to repay to UNL any amounts wrongfully returned or distributed to it under some circumstances. Under Delaware law, UNL may not make a distribution to limited partners if the distribution causes UNL s liabilities (other than liabilities to partners on account of their partnership interests and nonrecourse liabilities) to exceed the fair value of UNL s assets. Delaware law provides that a limited partner who receives such a distribution and knew at the time of the distribution that the distribution violated the law will be liable to the limited partnership for the amount of the distribution for three years from the date of the distribution. USCF s LLC Agreement provides limited authority to the Non-Management Directors, and any Director of USCF may be removed by USCF s parent company, which is wholly owned by The Marygold Companies, Inc., formerly Concierge Technologies, Inc., a controlled public company where the majority of shares are owned by Nicholas D. Gerber along with certain of his other family members and certain other shareholders. USCF s Board of Directors (the "Board") currently consists of four Management Directors, who are also executive officers or employees of USCF, and three Non-Management Directors, who are considered independent for purposes of applicable NYSE Arca and SEC rules. Under USCF s LLC Agreement, the Non-Management Directors have only such authority as the Management Directors expressly confer upon them, which means that the Non-Management Directors may have less authority to control the actions of the Management Directors than is typically the case with the independent members of a company s Board of Directors. In addition, any Director may be removed by written consent of Wainwright Holdings, Inc. ("Wainwright"), which is the sole member of USCF. The sole shareholder of Wainwright is The Marygold Companies, Inc., formerly Concierge Technologies, Inc., a company publicly traded under the ticker symbol "MGLD" ("Marygold"). Mr. Nicholas D. Gerber, along with certain of his family members and certain other shareholders, owns the majority of the shares in Marygold, which is the sole shareholder of Wainwright, the sole member of USCF. Accordingly, although USCF is governed by the Board, which consists of both Management Directors and Non-Management Directors, pursuant to the LLC Agreement, it is possible for Mr. Gerber to exercise his indirect control of Wainwright to effect the removal of any Director (including the Non-Management Directors which comprise the Audit Committee) and to replace that Director with another Director. Having control in one person could have a negative impact on USCF and UNL, including their regulatory obligations. There is a risk that UNL will not earn trading gains sufficient to compensate for the fees and expenses that it must pay and as such UNL may not earn any profit. UNL pays brokerage charges of approximately 0.03% of average total net assets based on brokerage fees of $3.50 per buy or sell, management fees of 0.75% of NAV on its average net assets, and OTC spreads and extraordinary expenses (e.g., subsequent offering expenses, other expenses not in the ordinary course of business, including the indemnification of any person against liabilities and obligations to the extent permitted by law and required under the LP Agreement and under agreements entered into by USCF on UNL s behalf and the bringing and defending of actions at law or in equity and otherwise engaging in the conduct of litigation and the incurring of legal expenses and the settlement of claims and litigation) that cannot be quantified. These fees and expenses must be paid in all cases regardless of whether UNL s activities are profitable. Accordingly, UNL must earn trading gains sufficient to compensate for these fees and expenses before it can earn any profit. UNL is subject to extensive regulatory reporting and compliance. UNL is subject to a comprehensive scheme of regulation under the federal commodities and securities laws. UNL could be subject to sanctions for a failure to comply with those requirements, which could adversely affect its financial performance (in the case of financial penalties) or ability to pursue its investment objective (in the case of a limitation on its ability to trade). Because UNL s shares are publicly traded, UNL is subject to certain rules and regulations of federal, state and financial market exchange entities charged with the protection of investors and the oversight of companies whose securities are publicly traded. These entities include the Public Company Accounting Oversight Board (the "PCAOB"), the SEC, the CFTC, the NFA, and NYSE Arca and these authorities have continued to develop additional regulations or interpretations of existing regulations. UNL s ongoing efforts to comply with these regulations and interpretations have resulted in, and are likely to continue resulting in, a diversion of management s time and attention from revenue-generating activities to compliance related activities. UNL is responsible for establishing and maintaining adequate internal control over financial reporting. UNL s internal control system is designed to provide reasonable assurance to its management regarding the preparation and fair presentation of published financial statements. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective may provide only reasonable assurance with respect to financial statement preparation and presentation. Regulatory changes or actions, including the implementation of new legislation, is impossible to predict but may significantly and adversely affect UNL. The futures markets are subject to comprehensive statutes, regulations, and margin requirements. In addition, the CFTC and futures exchanges are authorized to take extraordinary actions in the event of a market emergency, including, for example, the retroactive implementation of speculative position limits or higher margin requirements, the establishment of daily price limits and the suspension of trading. Regulation of commodity interest transactions in the United States is a rapidly changing area of law and is subject to ongoing modification by governmental and judicial action. Considerable regulatory attention has been focused on non-traditional investment pools that are publicly distributed in the United States. In addition, the SEC, CFTC and the exchanges are authorized to take extraordinary actions in the event of a market emergency, including, for example, the retroactive implementation of speculative position limits or higher margin requirements, the establishment of daily price limits and the suspension of trading. Further, various national governments outside of the United States have expressed concern regarding the disruptive effects of speculative trading in the energy markets and the need to regulate the derivatives markets in general. The effect of any future regulatory change on UNL is impossible to predict, but it could be substantial and adverse. UNL is not a registered investment company so shareholders do not have the protections of the 1940 Act. UNL is not an investment company subject to the 1940 Act. Accordingly, investors do not have the protections afforded by that statute which, for example, requires investment companies to have a majority of disinterested directors and regulates the relationship between the investment company and its investment manager. Trading in international markets could expose UNL to credit and regulatory risk. UNL invests primarily in Futures Contracts, a significant portion of which are traded on United States exchanges, including the NYMEX. However, a portion of UNL s trades may take place on markets and exchanges outside the United States. Trading on such non-U.S. markets or exchanges presents risks because they are not subject to the same degree of regulation as their U.S. counterparts, including potentially different or diminished investor protections. In trading contracts denominated in currencies other than U.S. dollars, UNL is subject to the risk of adverse exchange-rate movements between the dollar and the functional currencies of such contracts. Additionally, trading on non-U.S. exchanges is subject to the risks presented by exchange controls, expropriation, increased tax burdens and exposure to local economic declines and political instability. An adverse development with respect to any of these variables could reduce the profit or increase the loss earned on trades in the affected international markets. UNL and USCF may have conflicts of interest, which may permit them to favor their own interests to the detriment of shareholders. UNL is subject to actual and potential inherent conflicts involving USCF, various commodity futures brokers and Authorized Participants. USCF s officers, directors and employees do not devote their time exclusively to UNL and also are directors, officers or employees of other entities that may compete with UNL for their services. They could have a conflict between their responsibilities to UNL and to those other entities. As a result of these and other relationships, parties involved with UNL have a financial incentive to act in a manner other than in the best interests of UNL and the shareholders. USCF has not established any formal procedure to resolve conflicts of interest. Consequently, investors are dependent on the good faith of the respective parties subject to such conflicts of interest to resolve them equitably. Although USCF attempts to monitor these conflicts, it is extremely difficult, if not impossible, for USCF to ensure that these conflicts do not, in fact, result in adverse consequences to the shareholders. USCF serves as the general partner or sponsor to each of UNL and the Related Public Funds. USCF may have a conflict to the extent that its trading decisions for UNL may be influenced by the effect they would have on the other funds it manages. By way of example, if, as a result of reaching position limits imposed by the NYMEX, UNL purchased natural gas futures contracts, this decision could impact UNL s ability to purchase additional natural gas futures contracts if the number of contracts held by funds managed by USCF reached the maximum allowed by the NYMEX. Similar situations could adversely affect the ability of any fund to track its Benchmark Futures Contracts. UNL may also be subject to certain conflicts with respect to its FCMs, including, but not limited to, conflicts that result from receiving greater amounts of compensation from other clients, or purchasing opposite or competing positions on behalf of third-party accounts traded through the FCMs. In addition, USCF s principals, officers, directors or employees may trade futures and related contracts for their own account. A conflict of interest may exist if their trades are in the same markets and at the same time as UNL trades using the clearing broker to be used by UNL. A potential conflict also may occur if USCF s principals, officers, directors or employees trade their accounts more aggressively or take positions in their accounts which are opposite, or ahead of, the positions taken by UNL. UNL could terminate at any time and cause the liquidation and potential loss of an investor s investment and could upset the overall maturity and timing of an investor s investment portfolio. UNL may terminate at any time, regardless of whether UNL has incurred losses, subject to the terms of the LP Agreement. In particular, unforeseen circumstances, including, but not limited to, (i) market conditions, regulatory requirements, risk mitigation measures taken by UNL or third parties or otherwise that would lead UNL to determine that it could no longer foreseeably meet its investment objective or that UNL s aggregate net assets in relation to its operating expenses or its margin or collateral requirements make the continued operation of UNL unreasonable or imprudent, or (ii) adjudication of incompetence, bankruptcy, dissolution, withdrawal or removal of USCF as the general partner of UNL could cause UNL to terminate unless a majority interest of the limited partners within 90 days of the event elects to continue the partnership and appoints a successor general partner, or the affirmative vote of a majority in interest of the limited partners subject to certain conditions. However, no level of losses will require USCF to terminate UNL. UNL s termination would cause the liquidation and potential loss of an investor s investment. Termination could also negatively affect the overall maturity and timing of an investor s investment portfolio. UNL does not expect to make cash distributions. UNL has not previously made any cash distributions and intends to reinvest any realized gains in additional Natural Gas Interests rather than distributing cash to limited partners or other shareholders. Therefore, unlike mutual funds, commodity pools or other investment pools that actively manage their investments in an attempt to realize income and gains from their investing activities and distribute such income and gains to their investors, UNL generally does not expect to distribute cash to limited partners. An investor should not invest in UNL if the investor will need cash distributions from UNL to pay taxes on its share of income and gains of UNL, if any, or for any other reason. Nonetheless, although UNL does not intend to make cash distributions, the income earned from its investments held directly or posted as margin may reach levels that merit distribution, e.g., at levels where such income is not necessary to support its underlying investments in Natural Gas Interests and investors adversely react to being taxed on such income without receiving distributions that could be used to pay such tax. If this income becomes significant then cash distributions may be made. An unanticipated number of Redemption Basket requests during a short period of time could have an adverse effect on UNL s NAV. If a substantial number of requests for redemption of Redemption Baskets are received by UNL during a relatively short period of time, UNL may not be able to satisfy the requests from UNL s assets not committed to trading. As a consequence, it could be necessary to liquidate positions in UNL s trading positions before the time that the trading strategies would otherwise dictate liquidation. The suspension in the ability of Authorized Participants to purchase Creation Baskets could cause UNL s NAV to differ materially from its trading price. In the event that there was a suspension in the ability of Authorized Participants to purchase additional Creation Baskets, Authorized Participants and other groups that make a market in shares of UNL would likely still continue to actively trade the shares. However, in such a situation, Authorized Participants and other market makers may seek to adjust the market they make in the shares. Specifically, such market participants may increase the spread between the prices that they quote for offers to buy and sell shares to allow them to adjust to the potential uncertainty as to when they might be able to purchase additional Creation Baskets of shares. In addition, Authorized Participants may be less willing to offer to quote offers to buy or sell shares in large numbers. The potential impact of either wider spreads between bid and offer prices, or reduced number of shares on which quotes may be available, could increase the trading costs to investors in UNL compared to the quotes and the number of shares on which bids and offers are made if the Authorized Participants still were able to freely create new baskets of shares. In addition, there could be a significant variation between the market price at which shares are traded and the shares NAV, which is also the price shares can be redeemed with UNL by Authorized Participants in Redemption Baskets. The foregoing could also create significant deviations from UNL s investment objective. Any potential impact to the market in shares of UNL that could occur from the Authorized Participant s inability to create new baskets would likely not extend beyond the time when additional shares would be registered and available for distribution. UNL may determine to reinvest the proceeds from sales of its Creation Baskets in currently permitted assets in a manner that meets its investment objective it may limit its offers of Creation Baskets. UNL may determine that UNL will limit the issuance of its shares through the offering of Creation Baskets to its Authorized Participants. As a result of certain circumstances described herein, including (1) the need to comply with regulatory requirements (including, but not limited to, exchange accountability levels and position limits); (2) market conditions (including but not limited to those allowing UNL to obtain greater liquidity or to execute transactions with more favorable pricing); and (3) risk mitigation measures taken by UNL s current and other FCMs that limit UNL and other market participants from investing in particular natural gas futures contracts, UNL s management can determine that it will limit the issuance of shares and the offerings of Creation Baskets because it is unable to invest the proceeds from such offerings in investments that would permit it to reasonably meet its investment objective. If such a determination is made, the same consequences associated with a suspension of the offering of Creation Baskets, as described in the foregoing risk factor, The suspension in the ability of Authorized Participants to purchase Creation Baskets could cause UNL s NAV to differ materially from its trading price. The value of Treasury Bills and Money Market securities held by UNL will fluctuate in value with changes in interest rates. Interest rate risk is generally lower for shorter term investments and higher for longer term investments. UNL may be subject to a greater risk of rising interest rates than would normally be the case due to the current period of historically low rates and the effect of potential fiscal policy initiatives and resulting market reaction to those initiatives. When interest rates fall, UNL may be required to reinvest the proceeds from the sale, redemption or early prepayment of a Treasury Bill or money market security at a lower interest rate. UNL may potentially lose money on its holdings of money market funds. UNL invests in government money market funds. Although such government money market funds seek to preserve the value of an investment at $1.00 per share, there is no guarantee that they will be able to do so and UNL may lose money by investing in a government money market fund. An investment in a government money market fund is not insured or guaranteed by the Federal Deposit Insurance Corporation, referred to herein as the FDIC, or any other government agency. The share price of a government money market fund can fall below the $1.00 share price. UNL cannot rely on or expect a government money market fund s adviser or its affiliates to enter into support agreements or take other actions to maintain the government money market fund s $1.00 share price. The credit quality of a government money market fund s holdings can change rapidly in certain markets, and the default of a single holding could have an adverse impact on the government money market fund s share price. Due to fluctuations in interest rates, the market value of securities held by a government money market fund may vary. A government money market fund s share price can also be negatively affected during periods of high redemption pressures and/or illiquid markets. The failure or bankruptcy of a clearing broker or UNL s Custodian could result in a substantial loss of UNL s assets and could impair UNL in its ability to execute trades. The CEA and CFTC regulations impose several requirements on FCMs and clearing houses that are designed to protect customers, including mandating the implementation of risk management programs, internal monitoring and controls, capital and liquidity standards, customer disclosures, and auditing and examination programs. In particular, the CEA and CFTC regulations require FCMs and clearing houses to segregate all funds received from customers from proprietary assets. There can be no assurance that the requirements imposed by the CEA and CFTC regulations will prevent losses to, or not materially adversely affect, UNL or its investors. In particular, in the event of an FCM s or clearing house s bankruptcy, UNL could be limited to recovering either a pro rata share of all available funds segregated on behalf of the FCM s combined customer accounts or UNL may not recover any assets at all. UNL may also incur a loss of any unrealized profits on its open and closed positions. This is because if such a bankruptcy were to occur, UNL would be afforded the protections granted to customers of an FCM, and participants to transactions cleared through a clearing house, under the United States Bankruptcy Code and applicable CFTC regulations. Such provisions generally provide for a pro rata distribution to customers of customer property held by the bankrupt FCMs or an Exchange s clearing house if the customer property held by the FCMs or the Exchange s clearing house is insufficient to satisfy all customer claims. Bankruptcy of a clearing FCM can be caused by, among other things, the default of one of the FCM s customers. In this event, the Exchange s clearing house is permitted to use the entire amount of margin posted by UNL (as well as margin posted by other customers of the FCM) to cover the amounts owed by the bankrupt FCM. Consequently, UNL could be unable to recover amounts due to it on its futures positions, including assets posted as margin, and could sustain substantial losses. Notwithstanding that UNL could sustain losses upon the failure or bankruptcy of its FCM, the majority of UNL s assets are held in Treasuries, cash and/or cash equivalents with UNL s Custodian and would not be impacted by the bankruptcy of an FCM. The failure or bankruptcy of UNL s Custodian could result in a substantial loss of UNL s assets. The majority of UNL s assets are held in Treasuries, cash and/or cash equivalents with the Custodian. The insolvency of the Custodian could result in a complete loss of UNL s assets held by that Custodian, which, at any given time, would likely comprise a substantial portion of UNL s total assets. Third parties may infringe upon or otherwise violate intellectual property rights or assert that USCF has infringed or otherwise violated their intellectual property rights, which may result in significant costs and diverted attention. It is possible that third parties might utilize UNL s intellectual property or technology, including the use of its business methods, trademarks and trading program software, without permission. USCF has a patent for UNL s business method and has registered its trademarks. UNL does not currently have any proprietary software. However, if it obtains proprietary software in the future, any unauthorized use of UNL s proprietary software and other technology could also adversely affect its competitive advantage. UNL may not have adequate resources to implement procedures for monitoring unauthorized uses of its patents, trademarks, proprietary software and other technology. Also, third parties may independently develop business methods, trademarks or proprietary software and other technology similar to that of USCF or claim that USCF has violated their intellectual property rights, including their copyrights, trademark rights, trade names, trade secrets and patent rights. As a result, USCF may have to litigate in the future to protect its trade secrets, determine the validity and scope of other parties proprietary rights, defend itself against claims that it has infringed or otherwise violated other parties rights, or defend itself against claims that its rights are invalid. Any litigation of this type, even if USCF is successful and regardless of the merits, may result in significant costs, divert its resources from UNL, or require it to change its proprietary software and other technology or enter into royalty or licensing agreements. Due to the increased use of technologies, intentional and unintentional cyber-attacks pose operational and information security risks. With the increased use of technologies such as the internet and the dependence on computer systems to perform necessary business functions, UNL is susceptible to operational and information security risks. In general, cyber incidents can result from deliberate attacks or unintentional events such as a cyber-attack against UNL, a natural catastrophe, an industrial accident, failure of UNL s disaster recovery systems, or consequential employee error. Cyber-attacks include, but are not limited to, gaining unauthorized access to digital systems for purposes of misappropriating assets or sensitive information, corrupting data, or causing operational disruption. Cyber-attacks may also be carried out in a manner that does not require gaining unauthorized access, such as causing denial-of-service attacks on websites. Cyber security failures or breaches of UNL s clearing broker or third party service provider (including, but not limited to, index providers, the administrator and transfer agent, the custodian), have the ability to cause disruptions and impact business operations, potentially resulting in financial losses, the inability of UNL shareholders to transact business, violations of applicable privacy and other laws, regulatory fines, penalties, reputational damage, reimbursement or other compensation costs, and/or additional compliance costs. Adverse effects can become particularly acute if those events affect UNL s electronic data processing, transmission, storage, and retrieval systems, or impact the availability, integrity, or confidentiality of our data. In addition, a service provider that has experienced a cyber-security incident may divert resources normally devoted to servicing UNL to addressing the incident, which would be likely to have an adverse effect on UNL s operations. Cyber-attacks may also cause disruptions to the futures exchanges and clearinghouses through which UNL invests in futures contracts, which could result in disruptions to UNL s ability to pursue its investment objective, resulting in financial losses to UNL and its shareholders. In addition, substantial costs may be incurred in order to prevent any cyber incidents in the future. UNL and its shareholders could be negatively impacted as a result. While USCF and the Related Public Funds, including UNL, have established business continuity plans, there are inherent limitations in such plans, including the possibility that certain risks have not been identified or that new risks will emerge before countervailing measures can be implemented. Furthermore, UNL cannot control cybersecurity plans and systems of its service providers, market makers or Authorized Participants. UNL s investment returns could be negatively affected by climate change and greenhouse gas restrictions. Driven by concern over the risks of climate change, a number of countries have adopted, or are considering the adoption of, regulatory frameworks to reduce greenhouse gas emissions or production and use of oil and gas. These include adoption of cap and trade regimes, carbon taxes, trade tariffs, minimum renewable usage requirements, restrictive permitting, increased efficiency standards, and incentives or mandates for renewable energy. Political and other actors and their agents increasingly seek to advance climate change objectives indirectly, such as by seeking to reduce the availability of or increase the cost for, financial and investment in the oil and gas sector and taking actions intended to promote changes in business strategy for oil and gas companies. Many governments are also providing tax advantages and other subsidies to support transitioning to alternative energy sources or mandating the use of specific fuels other than oil or natural gas. Depending on how policies are formulated and applied, they could have the potential to negatively affect UNL s investment returns and make oil and natural gas products more expensive or less competitive. USCF is the subject of class action litigation. In light of the inherent uncertainties involved in litigation matters, an adverse outcome in this litigation could materially adversely affect USCF's financial condition. USCF and USCF's directors and certain of its officers are currently subject to class action litigation. Estimating an amount or range of possible losses resulting from litigation proceedings to USCF is inherently difficult and requires an extensive degree of judgment, particularly where the matters involve indeterminate claims for monetary damages and are subject to appeal. In addition, because most legal proceedings are resolved over extended periods of time, potential losses are subject to change due to, among other things, new developments, changes in legal strategy, the outcome of intermediate procedural and substantive rulings and other parties' settlement posture and their evaluation of the strength or weakness of their case against USCF. For these reasons, we are currently unable to predict the ultimate timing or outcome of, or reasonably estimate the possible losses or a range of possible losses resulting therefrom. In light of the inherent uncertainties involved in such matters, an adverse outcome in this litigation could materially adversely affect USCF's financial condition, results of operations or cash flows in any particular reporting period. In addition, litigation could result in substantial costs and divert USCF's management's attention and resources from conducting USCF's operations, including the management of UNL and the Related Public Funds. ADDITIONAL INFORMATION ABOUT UNL, ITS INVESTMENT OBJECTIVE AND INVESTMENTS UNL is a Delaware limited partnership organized on June 27, 2007. It operates pursuant to the terms of the Third Amended and Restated Agreement of Limited Partnership dated as of December 15, 2017, (as amended from time to time, the "LP Agreement"), which grants full management control of UNL to USCF. UNL maintains its main business office at 1850 Mt. Diablo Boulevard, Suite 640, Walnut Creek, California 94596. The net assets of UNL consist primarily of investments in Futures Contracts and, to a lesser extent, in order to comply with regulatory requirements, risk mitigation measures, liquidity requirements, or in view of market conditions, Other Natural Gas-Related Investments. Market conditions that USCF currently anticipates could cause UNL to invest in Other Natural Gas-Related Investments include those allowing UNL to obtain greater liquidity or to execute transactions with more favorable pricing. UNL invests substantially the entire amount of its assets in Futures Contracts while supporting such investments by holding the amounts of its margin, collateral and other requirements relating to these obligations in short-term obligations of the United States of two years or less ("Treasuries"), cash and cash equivalents. The daily holdings of UNL are available on UNL s website at www.uscfinvestments.com. UNL invests in Natural Gas Interests to the fullest extent possible without being leveraged or unable to satisfy its current or potential margin or collateral obligations with respect to its investments in Natural Gas Interests. In pursuing this objective, the primary focus of USCF is the investment in Futures Contracts and the management of UNL s investments in Treasuries, cash and/or cash equivalents for margining purposes and as collateral. UNL seeks to invest in a combination of Natural Gas Interests such that the daily changes in its NAV, measured in percentage terms, will closely track the daily changes in the price of the Benchmark Futures Contracts, also measured in percentage terms. As a specific benchmark, USCF endeavors to place UNL s trades in Natural Gas Interests and otherwise manage UNL s investments so that "A" will be within plus/minus ten percent (10%) of "B", where: A is the average daily percentage change in UNL s per share NAV for any period of 30 successive valuation days, i.e., any NYSE Arca trading day as of which UNL calculates its per share NAV; and B is the average daily percentage change in the average of the prices of the Benchmark Futures Contracts over the same period. USCF believes that market arbitrage opportunities will cause the daily changes in UNL s share price on the NYSE Arca to closely track the daily changes in UNL s per share NAV. USCF further believes that the daily changes in UNL s NAV in percentage terms will closely track the daily changes in percentage terms in the average of the prices of the Benchmark Futures Contracts, less UNL s expenses. The following two charts demonstrate the correlation between the changes in UNL s NAV and the changes in the Benchmark Futures Contracts. The first chart exhibits the daily changes in the last 30 valuation days ended December 31, 2021. The second chart measures monthly changes since December 31, 2016 through December 31, 2021. *PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS *PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS USCF employs a "neutral" investment strategy in order to track changes in the average of the prices of the Benchmark Futures Contracts regardless of whether the price goes up or goes down. UNL s "neutral" investment strategy is designed to permit investors generally to purchase and sell UNL s shares for the purpose of investing indirectly in natural gas in a cost-effective manner, and/or to permit participants in the natural gas or other industries to hedge the risk of losses in their natural gas-related transactions. Accordingly, depending on the investment objective of an individual investor, the risks generally associated with investing in natural gas and/or the risks involved in hedging may exist. In addition, an investment in UNL involves the risk that the daily changes in the average of the prices of UNL s shares, in percentage terms, will not accurately track the daily changes in the average prices of the Benchmark Futures Contracts, in percentage terms, and that daily changes in the Benchmark Futures Contracts, in percentage terms, will not closely correlate with daily changes in the spot prices of natural gas, in percentage terms. An alternative tracking measurement of the return performance of UNL versus the return of the Benchmark Futures Contracts can be calculated by comparing the actual return of UNL, measured by changes in its per share NAV, versus the expected changes in its per share NAV under the assumption that UNL s returns had been exactly the same as the daily changes in its Benchmark Futures Contracts. For the year ended December 31, 2021, the actual total return of UNL as measured by changes in its per share NAV was 50.52%. This is based on an initial per share NAV of $7.74 as of December 31, 2020 and an ending per share NAV as of December 31, 2021 of $11.65. During this time period, UNL made no distributions to its shareholders. However, if UNL s daily changes in its per share NAV had instead exactly tracked the changes in the daily total return of the Benchmark Futures Contracts , UNL would have had an estimated per share NAV of $11.65 as of December 31, 2021, for a total return over the relevant time period of 50.52%. The difference between the actual per share NAV total return of UNL of 50.52% and the expected total return based on the Benchmark Futures Contracts of 50.52% was an error over the time period of (0.00)%, which is to say that UNL s actual total return underperformed its benchmark by that percentage. UNL incurs expenses primarily composed of the management fee, brokerage commissions for the buying and selling of futures contracts, and other expenses. The impact of these expenses, offset by interest and dividend income, and net of positive or negative execution, tends to cause daily changes in the per share NAV of UNL to track slightly lower or higher than daily changes in the price of the Benchmark Futures Contracts. Impact of Contango and Backwardation on Total Returns Several factors determine the total return from investing in futures contracts. One factor arises from "rolling" futures contracts that will expire at the end of the current month (the "near" or "front" month contract) forward each month prior to expiration. For a strategy that entails holding the near month contract, the price relationship between that futures contract and the next month futures contract will impact returns. For example, if the price of the near month futures contract is higher than the next futures month contract (a situation referred to as "backwardation"), then absent any other change, the price of a next month futures contract tends to rise in value as it becomes the near month futures contract and approaches expiration. Conversely, if the price of a near month futures contract is lower than the next month futures contract (a situation referred to as "contango"), then absent any other change, the price of a next month futures contract tends to decline in value as it becomes the near month futures contract and approaches expiration. As an example, assume that the price of natural gas for immediate delivery, is $3 per MMBtu, and the value of a position in the near month futures contract is also $3. Over time, the price of natural gas will fluctuate based on a number of market factors, including demand for oil relative to supply. The value of the near month futures contract will likewise fluctuate in reaction to a number of market factors. If an investor seeks to maintain a position in a near month futures contract and not take delivery of physical MMBtu of natural gas, the investor must sell the current near month futures contract as it approaches expiration and invest in the next month futures contract. In order to continue holding a position in the current near month futures contract, this "roll" forward of the futures contract must be executed every month. Contango and backwardation are natural market forces that have impacted the total return on an investment in UNL s shares during the past year relative to a hypothetical direct investment in natural gas. In the future, it is likely that the relationship between the market price of UNL s shares and changes in the spot prices of natural gas will continue to be impacted by contango and backwardation. It is important to note that this comparison ignores the potential costs associated with physically owning and storing natural gas, which could be substantial. If the futures market is in backwardation, e.g., when the price of the near month futures contract is higher than the price of the next month futures contract, the investor would buy a next month futures contract for a lower price than the current near month futures contract. Assuming the price of the next month futures contract was $2.94 per MMBtu, or 2% cheaper than the $3 near month futures contract, then, hypothetically, and assuming no other changes (e.g., to either prevailing natural gas prices or the price relationship between the spot price, the near month contract and the next month contract, and, ignoring the impact of commission costs and the income earned on cash and/or cash equivalents), the value of the $2.94 next month futures contract would rise to $3 as it approaches expiration. In this example, the value of an investment in the next month futures contract would tend to outperform the spot price of natural gas. As a result, it would be possible for the new near month futures contract to rise 12% while the spot price of natural gas may have risen a lower amount, e.g., only 10%. Similarly, the spot price of natural gas could have fallen 10% while the value of an investment in the futures contract might have fallen another amount, e.g., only 8%. Over time, if backwardation remained constant, this difference between the spot price and the futures contract price would continue to increase. If the futures market is in contango, an investor would be buying a next month futures contract for a higher price than the current near month futures contract. Again, assuming the near month futures contract is $3 per MMBtu, the price of the next month futures contract might be $3.06 per MMBtu, or 2% more expensive than the front month futures contract. Hypothetically, and assuming no other changes, the value of the $3.06 next month futures contract would fall to $3 as it approaches expiration. In this example, the value of an investment in the second month would tend to underperform the spot price of natural gas. As a result, it would be possible for the new near month futures contract to rise only 10% while the spot price of natural gas may have risen a higher amount, e.g., 12%. Similarly, the spot price of natural gas could have fallen 10% while the value of an investment in the second month futures contract might have fallen another amount, e.g., 12%. Over time, if contango remained constant, this difference between the spot price and the futures contract price would continue to increase. The chart below compares the daily price of the near month natural gas futures contract to the price of 13th month natural gas futures contract (i.e., a contract one year forward) over the last 10 years. When the price of the near month futures contract is higher than the price of the 13th month futures contract, the market would be described as being in backwardation. When the price of the near month futures contract is lower than the 13th month futures contract, the market would be described as being in contango. Although the price of the near month futures contract and the price of the 13th month futures contract tend to move together, it can be seen that at times the near month futures contract prices are higher than the 13th month futures contract prices (backwardation) and, at other times, the near month futures contract prices are lower than the 13th month futures contract prices (contango). *PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS An alternative way to view the same data is to subtract the dollar price of the 13th month natural gas futures contract from the dollar price of the near month natural gas futures contract, as shown in the chart below. When the difference is positive, the market is in backwardation. When the difference is negative, the market is in contango. The natural gas market spent time in both backwardation and contango during the last ten years. The chart below shows the results from subtracting the average dollar price of the near 12-month contracts from the near month price for the 10-year period between December 31, 2011 and December 31, 2021. Investors will note that the natural gas market spent time in both backwardation and contango during that period. *PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS An investment in a portfolio that owned only the near month natural gas futures contract would likely produce a different result than an investment in a portfolio that owned an equal number of each of the near 12 months of natural gas futures contracts. Generally speaking, when the natural gas futures market is in backwardation, a portfolio of only the near month natural gas futures contract may tend to have a higher total return than a portfolio of 12 months of the natural gas futures contract. Conversely, if the natural gas futures market is in contango, the portfolio containing only 12 months of natural gas futures contracts may tend to outperform the portfolio holding only the near month natural gas futures contract. Historically, the natural gas futures markets have experienced periods of contango and backwardation. Because natural gas demand is seasonal, it is possible for the price of natural gas futures contracts for delivery within one or two months to rapidly move from backwardation into contango and back again within the relatively short period of time of less than one year. The Russian invasion of Ukraine and related developments have placed upward pressure on the prices of the Benchmark Futures Contracts. From 2011 to 2021, the average difference in price between the front-month Benchmark Futures Contract and the 1-year ahead Benchmark Futures Contract was ($0.17). A negative price difference such as this indicates that the Benchmark Futures Contract was generally in contango during the 2011 to 2021 ten-year period. During this time frame, the natural gas market experienced several intermittent periods of backwardation, mostly due to extreme cold winter weather. Recently, there was a temporary spike in backwardation in late January 2022 that reflected the reaction of futures prices to extreme weather. However, there has been a more sustained increase in backwardation as well that has continued into the second quarter of 2022 that reflects the impact of the Russian invasion of Ukraine. As of the end of 2021, the spread between the front-month Benchmark Futures Contract and the 1-year ahead Benchmark Futures Contract was ($0.25), with the front month Benchmark Futures Contract trading at a price that is 6.3% lower than the price for the 1-year ahead futures contract. The spread changed from contango into backwardation in January 2022 and was $1.74 by March 31, 2022. This represents a 44.5% price premium for the front month Benchmark Futures Contract relative to the 1-year ahead Benchmark Futures Contract. There can be no assurance that this current period of backwardation will continue, nor is it possible to predict how long backwardation will continue. If the war in Ukraine continues and/or escalates, or if sanctions or responses by the United States and/or other nations, lead to a reduction in the supply of natural gas from Russia to Europe, then all natural gas prices could rise, and distortions in the futures curve for the Benchmark Futures Contract could become more pronounced. In contrast, if concerns about a natural gas shortage resulting from the war in Ukraine ebb due to an expected or actual resolution of the war, then natural gas prices for all delivery months could decline, and the premium for the Benchmark Futures Contracts closer to expiration would most likely fall. Periods of contango or backwardation do not materially impact UNL s investment objective of having the daily percentage changes in its per share NAV track the daily percentage changes in the average of the prices of the Benchmark Futures Contracts since the impact of backwardation and contango tend to equally impact the daily percentage changes in price of both UNL s shares and the Benchmark Futures Contracts. It is impossible to predict with any degree of certainty whether backwardation or contango will occur in the future. It is likely that both conditions will occur during different periods and, because of the seasonal nature of natural gas demand, both may occur within a single year s time. In managing UNL s assets, USCF does not use a technical trading system that issues buy and sell orders. USCF employs a quantitative methodology whereby each time a Creation Basket is sold, USCF purchases Natural Gas Interests, such as the Benchmark Futures Contracts, that have an aggregate market value that approximates the amount of Treasuries and/or cash received from the sale of the Creation Basket. The specific Futures Contracts purchased depend on various factors, including a judgment by USCF as to the appropriate diversification of UNL s investments in futures contracts with respect to the month of expiration, and the prevailing price volatility of particular contracts. While USCF has made significant investments in NYMEX Futures Contracts, for various reasons, including the ability to enter into the precise amount of exposure to the natural gas market, position limits or other regulatory requirements limiting UNL s holdings, and market conditions, it may invest in Futures Contracts traded on other exchanges or invest in Other Natural Gas-Related Investments. To the extent that UNL invests in Other Natural Gas-Related Investments, it would prioritize investments in contracts and instruments that are economically equivalent to the Benchmark Futures Contracts, including cleared swaps that satisfy such criteria, and then, to a lesser extent, it would invest in other types of cleared swaps and other contracts, instruments and non-cleared swaps, such as swaps in the over-the-counter (or commonly referred to as the OTC market). If UNL is required by law or regulation, or by one of its regulators, including a futures exchange, to reduce its position in the Futures Contracts to the applicable position limit or to a specified accountability level or if market conditions dictate it would be more appropriate to invest in Other Natural Gas-Related Investments, a substantial portion of UNL s assets could be invested in accordance with such priority in Other Natural Gas-Related Investments that are intended to replicate the return on the Benchmark Futures Contracts. As UNL s assets reach higher levels, it is more likely to exceed position limits, accountability levels or other regulatory limits and, as a result, it is more likely that it will invest in accordance with such priority in Other Natural Gas-Related Investments at such higher levels. In addition, market conditions that USCF currently anticipates could cause UNL to invest in Other Natural Gas-Related Investments include those allowing UNL to obtain greater liquidity or to execute transactions with more favorable pricing. See "Risk Factors Involved with an Investment in UNL" for a discussion of the potential impact of regulation on UNL s ability to invest in OTC transactions and cleared swaps. USCF may not be able to fully invest UNL s assets in the Benchmark Futures Contracts having an aggregate notional amount exactly equal to UNL s NAV. For example, as standardized contracts, the Futures Contracts are for a specified amount of a particular commodity, and UNL s NAV and the proceeds from the sale of a Creation Basket are unlikely to be an exact multiple of the amounts of those contracts. As a result, in such circumstances, UNL may be better able to achieve the exact amount of exposure to changes in price of the Benchmark Futures Contracts through the use of Other Natural Gas-Related Investments, such as OTC contracts that have better correlation with changes in price of the Benchmark Futures Contracts. UNL anticipates that to the extent it invests in Futures Contracts other than contracts on natural gas (such as futures contracts for light, sweet crude oil, diesel-heating oil and other petroleum-based fuels) and Other Natural Gas-Related Investments, it will enter into various non-exchange-traded derivative contracts to hedge the short-term price movements of such Natural Gas Interests against the current Benchmark Futures Contracts. USCF does not anticipate letting UNL s Futures Contracts expire and taking delivery of the underlying commodity. Instead, USCF will close existing positions, e.g., when it changes the Benchmark Futures Contracts or Other Natural Gas-Related Investments or it otherwise determines it would be appropriate to do so and reinvests the proceeds in new Natural Gas Interests. Positions may also be closed out to meet orders for Redemption Baskets and in such case proceeds for such baskets will not be reinvested. The Benchmark Futures Contracts are changed from the near month contract to expire and the 11 following months to the next month contract to expire and the 11 following months during one day each month. On that day, USCF anticipates it will "roll" UNL s positions by closing, or selling, its Natural Gas Interests and reinvest the proceeds from closing these positions in new Natural Gas Interests. The anticipated dates that the monthly roll period will commence are posted on UNL s website at www.uscfinvestments.com, and are subject to change without notice. By remaining invested as fully as possible in Natural Gas Interests, USCF believes that the daily changes in percentage terms in UNL s per share NAV will continue to closely track the daily changes in percentage terms in the average of the prices of the Benchmark Futures Contracts. USCF believes that certain arbitrage opportunities result in the price of the shares traded on the NYSE Arca closely tracking the per share NAV of UNL. Additionally, Futures Contracts traded on the NYMEX have closely tracked the spot price of natural gas. Based on these expected interrelationships, USCF believes that the daily changes in the price of UNL s shares traded on the NYSE Arca, on a percentage basis, have closely tracked and will continue to closely track on a daily basis, the changes in the spot price of natural gas on a percentage basis. What are the Trading Policies of UNL? Investment Objective The investment objective of UNL is for the daily changes in percentage terms of its shares per share net asset value ("NAV") to reflect the daily changes in percentage terms of the price of natural gas delivered at the Henry Hub, Louisiana, as measured by the daily changes in the average of the prices of specified short-term futures contracts on natural gas called the "Benchmark Futures Contracts," plus interest earned on UNL s collateral holdings, less UNL s expenses. The Benchmark Futures Contracts are the futures contracts on natural gas as traded on the NYMEX that is the near month contract to expire, and the contracts for the following 11 months, for a total of 12 consecutive months contracts, except when the near month contract is within two weeks of expiration, in which case it will be measured by the futures contract that is the next month contract to expire and the contracts for the following 11 consecutive months. When calculating the daily movement of the average price of the 12 contracts, each contract month is equally weighted. UNL seeks to achieve its investment objective by investing so that that the average daily percentage change in UNL s NAV for any period of 30 successive valuation days will be within plus/minus ten percent (10%) of the average daily percentage change in the price of the Benchmark Futures Contracts over the same period. Liquidity UNL invests only in Futures Contracts and Other Natural Gas-Related Investments that, in the opinion of USCF, are traded in sufficient volume to permit the ready taking and liquidation of positions in these financial interests and Other Natural Gas-Related Investments that, in the opinion of USCF, may be readily liquidated with the original counterparty or through a third party assuming the position of UNL. Spot Commodities While the Futures Contracts can be physically settled, UNL does not intend to take or make physical delivery. UNL may from time to time trade in Other Natural Gas-Related Investments, including contracts based on the spot price of natural gas. Leverage USCF endeavors to have the value of UNL s Treasuries, cash and cash equivalents, whether held by UNL or posted as margin or other collateral, at all times approximate the aggregate market value of its obligations under its Futures Contracts and Other Natural Gas-Related Investments. Commodity pools trading positions in futures contracts or other related investments are typically required to be secured by the deposit of margin funds that represent only a small percentage of a futures contract s (or other commodity interest s) entire market value. While USCF has not and does not intend to leverage UNL s assets, it is not prohibited from doing so under the LP Agreement. Although permitted to do so under the LP Agreement, UNL has not and does not intend to leverage its assets and makes its investments accordingly. Consistent with this, UNL s investment decisions will take into account the need for UNL to make permitted investments that also allow it to maintain adequate liquidity to meet its margin and collateral requirements and to avoid, to the extent reasonably possible, UNL becoming leveraged, including by its holding of assets that have a high probability of causing the net asset value of the fund to be less than zero. Borrowings Borrowings are not used by UNL, unless UNL is required to borrow money in the event of physical delivery, if UNL trades in cash commodities, or for short-term needs created by unexpected redemptions. OTC Derivatives (including Spreads and Straddles) In addition to Futures Contracts, there are also a number of listed options on the Futures Contracts on the principal futures exchanges. These contracts offer investors and hedgers another set of financial vehicles to use in managing exposure to the natural gas market. Consequently, UNL may purchase options on natural gas Futures Contracts on these exchanges in pursuing its investment objective. In addition to the Futures Contracts and options on the Futures Contracts, there also exists an active non-exchange-traded market in derivatives tied to natural gas. These derivatives transactions (also known as OTC contracts) are usually entered into between two parties in private contracts. Unlike most of the exchange-traded Futures Contracts or exchange- traded options on the Futures Contracts, each party to such contract bears the credit risk of the other party, i.e., the risk that the other party may not be able to perform its obligations under its contract. To reduce the credit risk that arises in connection with such contracts, UNL will generally enter into an agreement with each counterparty based on the Master Agreement published by the International Swaps and Derivatives Association, Inc. ("ISDA") that provides for the netting of its overall exposure to its counterparty. USCF assesses or reviews, as appropriate, the creditworthiness of each potential or existing counterparty to an OTC contract pursuant to guidelines approved by the Board. UNL may enter into certain transactions where an OTC component is exchanged for a corresponding futures contract ("Exchange for Related Position" or "EFRP" transactions). In the most common type of EFRP transaction entered into by UNL, the OTC component is the purchase or sale of one or more baskets of UNL s shares. These EFRP transactions may expose UNL to counterparty risk during the interim period between the execution of the OTC component and the exchange for a corresponding futures contract. Generally, the counterparty risk from the EFRP transaction will exist only on the day of execution. UNL may employ spreads or straddles in its trading to mitigate the differences in its investment portfolio and its goal of tracking the price of the Benchmark Futures Contracts. UNL would use a spread when it chooses to take simultaneous long and short positions in futures written on the same underlying asset, but with different delivery months. During the year ended December 31, 2021 and through February 28, 2022, UNL limited its OTC activities to EFRP transactions. Pyramiding UNL has not employed and will not employ the technique, commonly known as pyramiding, in which the speculator uses unrealized profits on existing positions as variation margin for the purchase or sale of additional positions in the same or another commodity interest. Prior Performance of UNL PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS USCF manages UNL which is a commodity pool that issues shares traded on the NYSE Arca. The chart below shows, as of February 28, 2022, the number of Authorized Participants, the total number of baskets created and redeemed since inception and the number of outstanding shares for UNL. # of Authorized Participants Baskets Redeemed Baskets Purchased Outstanding Shares 9 -104 124 1,800,000 Since the commencement of the offering of UNL shares to the public on November 18, 2009 to February 28, 2022, the simple average daily change in the average price of its Benchmark Futures Contracts was (-0.024)%, while the simple average daily change in the per share NAV of UNL over the same time period was (-0.025)%. The average daily difference was (-0.001)% (or (0.1) basis points, where 1 basis point equals 1/100 of 1%). As a percentage of the daily movement of the average price of the Benchmark Futures Contracts, the average error in daily tracking by the per share NAV was 0.046%, meaning that over this time period UNL s tracking error was within the plus or minus 10% range established as its benchmark tracking goal. The table below shows the relationship between the trading prices of the shares and the daily NAV of UNL, since inception through February 28, 2022. The first row shows the average amount of the variation between UNL s closing market price and NAV, computed on a daily basis since inception, while the second and third rows depict the maximum daily amount of the end of day premiums and discounts to NAV since inception, on a percentage basis. USCF believes that maximum and minimum end of day premiums and discounts typically occur because trading in the shares continues on the NYSE Arca until 4:00 p.m. New York time while regular trading in the Benchmark Futures Contracts on the NYMEX ceases at 2:30 p.m. New York time and the value of the relevant Benchmark Futures Contracts, for purposes of determining its end of day NAV, can be determined at that time. UNL Average Difference $0.002 Max Premium % 6.153 Max Discount % (6.523) For more information on the performance of UNL, see the Performance Tables below. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS COMPOSITE PERFORMANCE DATA FOR UNL Name of Commodity Pool: United States 12 Month Natural Gas Fund, LP Type of Commodity Pool: Exchange traded security Inception of Trading: November 18, 2009 Aggregate Subscriptions (from inception through February 28, 2022): $159,139,942 Total Net Assets as of February 28, 2022: $25,702,700.55 NAV per Share as of February 28, 2022: $14.28 Worst Monthly Percentage Draw-down: November 2020 (11.05 )% Worst Peak-to-Valley Draw-down: December 2018 –February 2020 ( 37.65 )% Rates of Return* Month 2017 2018 2019 2020 2021 2022 January (8.94)% 4.32% 4.68% (9.02)% 2.33 % 29.7% February (8.22)% (5.59)% 1.30% (7.17)% 5.68 % ( 5.49 )% March 8.45% 1.86% (3.49)% 7.16 % ( 5.73 )% April 1.78% (1.94)% (4.00)% 13.24% 6.97 % May (5.81)% 4.72% (4.37)% (8.91)% 1.19 % June (1.86)% (0.52)% (5.50)% (4.07)% 16.86 % July (4.59)% (2.95)% (1.98)% 2.78% 8.82 % August 5.13% 2.50% (2.35)% 14.56% 7.92 % September 0.40% 0.11% 1.38% (3.60)% 23.55 % October (3.90)% 2.96% 3.17% 7.70% ( 2.69 )% November 0.62% 17.37% (8.77)% (11.05)% ( 7.17 )% December (4.34)% (10.16)% 1.32% (5.73)% ( 10.93 )% Annual Rate of Return (21.19)% 10.80% (17.84)% (8.19)% 0.52% 22.58 %** *The monthly rate of return is calculated by dividing the ending NAV of a given month by the ending NAV of the previous month, subtracting 1 and multiplying this number by 100 to arrive at a percentage increase or decrease. **Through February 28, 2022. Draw-down: Losses experienced by UNL over a specified period. Draw-down is measured on the basis of monthly returns only and does not reflect intra-month figures. Worst Monthly Percentage Draw-down: The largest single month loss sustained during the most recent five calendar years and year-to-date. Worst Peak-to-Valley Draw-down: The largest percentage decline in the NAV per share over the history of UNL. This need not be a continuous decline, but can be a series of positive and negative returns where the negative returns are larger than the positive returns. Worst Peak-to-Valley Draw-down represents the greatest cumulative percentage decline in month-end per share NAV is not equaled or exceeded by a subsequent month-end per share NAV. UNL S Operations USCF and its Management and Traders USCF is a single member limited liability company that was formed in the state of Delaware on May 10, 2005. USCF maintains its main business office at 1850 Mt. Diablo Boulevard, Suite 640, Walnut Creek, California 94596. USCF is a wholly-owned subsidiary of Wainwright, which is an intermediate holding company that owns USCF and another advisor of exchange traded funds. Wainwright is a wholly owned subsidiary of Marygold (publicly traded under the ticker MGLD), a publicly traded holding company that owns various financial and non-financial businesses. Mr. Nicholas Gerber (discussed below), along with certain family members and certain other shareholders, owns the majority of the shares in Marygold. Wainwright is a holding company that currently holds both USCF, as well as USCF Advisers LLC, an investment adviser registered under the Investment Advisers Act of 1940, as amended ("USCF Advisers"). USCF Advisers serves as the investment adviser for the USCF SummerHaven Dynamic Commodity Strategy No K-1 Fund ("SDCI"), the USCF Midstream Energy Income Fund ("UMI"), and the USCF Gold Strategy Plus Income Fund ("GLDX"); each of SDCI, UMI and GLDX is series of the USCF ETF Trust. USCF Advisers was also the investment adviser for the USCF Commodity Strategy Fund (the "Mutual Fund"), a series of the USCF Mutual Funds Trust, until March 2019, when the Mutual Fund liquidated all of its assets and distributed cash pro rata to all remaining shareholders. It was also the investment adviser for two series of the USCF ETF Trust that liquidated all of their assets and distributed cash pro rata to all remaining shareholders: the USCF SummerHaven SHPEI Index Fund ("BUY"), until October 2020, and the USCF SummerHaven SHPEN Index Fund ("BUYN"), until May 2020. USCF ETF Trust and USCF Mutual Funds Trust are registered under the Investment Company Act of 1940, as amended (the "1940 Act"). The Board of Trustees for the USCF ETF Trust and USCF Mutual Funds Trust consist of different independent trustees than those independent directors who serve on the Board of Directors of USCF. USCF is a member of the National Futures Association (the "NFA") and registered as a commodity pool operator ("CPO") with the Commodity Futures Trading Commission (the "CFTC") on December 1, 2005 and as a swaps firm on August 8, 2013. USCF serves as the general partner of UNL. USCF is also the general partner of the United States Oil Fund, LP ("USO"), the United States Natural Gas Fund, LP ("UNG"), the United States 12 Month Oil Fund, LP ("USL"), the United States Gasoline Fund, LP ("UGA"), and the United States Brent Oil Fund, LP ("BNO"). USCF is also the sponsor of the United States Commodity Index Fund ("USCI") and the United States Copper Index Fund ("CPER"), each a series of the United States Commodity Index Funds Trust ("USCIFT"). UNL, UNG, UGA, BNO, USL, USO, USCI and CPER are referred to collectively herein as the "Related Public Funds." The Related Public Funds are subject to reporting requirements under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). For more information about each of the Related Public Funds, investors in UNL may call 1-800-920-0259 or visit www.uscfinvestments.com or the SEC website at www.sec.gov. USCF is required to evaluate the credit risk of UNL to the FCMs, oversee the purchase and sale of UNL s shares by certain authorized participants ("Authorized Participants"), review daily positions and margin requirements of UNL and manage UNL s investments. USCF also pays the fees of ALPS Distributors, Inc., which serves as the marketing agent for UNL (the "Marketing Agent"), and The Bank of New York Mellon ("BNY Mellon"), which serves as the administrator (the "Administrator") and the custodian (the "Custodian") for UNL. In no event may the aggregate compensation paid for the Marketing Agent and any affiliate of USCF for distribution-related services in connection with the offering of shares exceed ten percent (10%) of the gross proceeds of this offering. The limited partners take no part in the management or control, and have a minimal voice in UNL s operations or business. Limited partners have no right to elect USCF on an annual or any other continuing basis. If USCF voluntarily withdraws, however, the holders of a majority of UNL s outstanding shares (excluding for purposes of such determination shares owned, if any, by the withdrawing general partner and its affiliates) may elect its successor. USCF may not be removed as general partner except upon approval by the affirmative vote of the holders of at least 66 2/3 percent of UNL s outstanding shares (excluding shares, if any, owned by USCF and its affiliates), subject to the satisfaction of certain conditions set forth in the LP Agreement. The business and affairs of USCF are managed by the Board, which is comprised of the Management Directors, each of whom are also executive officers and employees of USCF, and three independent directors who meet the independent director requirements established by the NYSE Arca Equities Rules and the Sarbanes-Oxley Act of 2002. The Management Directors have the authority to manage USCF pursuant to the terms of the LLC Agreement. Through its Management Directors, USCF manages the day-to-day operations of UNL. The Board has an audit committee, which is made up of the three independent directors (Gordon L. Ellis, Malcolm R. Fobes III and Peter M. Robinson,). The audit committee is governed by an audit committee charter that is posted on UNL s website at www.uscfinvestments.com. The Board has determined that each member of the audit committee meets the financial literacy requirements of the NYSE Arca and the audit committee charter. The Board has further determined that each of Messrs. Ellis and Fobes have accounting or related financial management expertise, as required by the NYSE Arca, such that each of them is considered an "Audit Committee Financial Expert" as such term is defined in Item 407(d)(5) of Regulation S-K. UNL has no executive officers. Pursuant to the terms of the LP Agreement, UNL s affairs are managed by USCF. The following are individual Principals, as that term is defined in CFTC Rule 3.1, for USCF: John P. Love, Stuart P. Crumbaugh, Daphne G. Frydman, Nicholas D. Gerber, Melinda D. Gerber, Andrew F Ngim, Robert L. Nguyen, Peter M. Robinson, Scott Schoenberger, Gordon L. Ellis, Malcolm R. Fobes III, Ray W. Allen, Kevin A. Baum, and Wainwright Holdings, Inc. The individuals who are Principals due to their positions are John P. Love, Stuart P. Crumbaugh, Daphne G. Frydman, Nicholas D. Gerber, Andrew F Ngim, Robert L. Nguyen, Peter M. Robinson, Gordon L. Ellis, Malcolm R. Fobes III, Ray W. Allen, and Kevin A. Baum. In addition, Wainwright is a Principal because it is the sole member of USCF. None of the Principals owns or has any other beneficial interest in UNL. Ray W. Allen makes trading and investment decisions for UNL. Ray W. Allen, and Andrew F Ngim execute trades on behalf of UNL. In addition, Nicholas D. Gerber, John P. Love, Robert L. Nguyen, Ray W. Allen, Kevin A. Baum, Kathryn Rooney, Maya Lowry, and Ryan Katz are registered with the CFTC as Associated Persons of USCF and are NFA Associate Members. John P. Love, Kevin A. Baum, and Ray W. Allen are also registered with the CFTC as Swaps Associated Persons. Ray W. Allen, 65, Portfolio Manager of USCF since January 2008. Mr. Allen was the portfolio manager of: (1) UGA from February 2008 until March 2010, and then portfolio manager since May 2015, (2) UHN from April 2008 until March 2010, and then portfolio manager since May 2015, (3) UNL from November 2009 until March 2010, and then portfolio manager since May 2015. In addition, he has been the portfolio manager of: (1) DNO since September 2009, (2) USO and USL since March 2010, (3) BNO since June 2010, (4) UNG since May 2015, (4) United States 3x Oil Fund and United States 3x Short Oil Fund from July 2017 to December 2019, and (5) the USCF Commodity Strategy Fund, a series of USCF Mutual Funds Trust, from October 2017 to March 2019. Mr. Allen also has served as the portfolio manager of the USCF SummerHaven Dynamic Commodity Strategy No K-1 Fund, a series of the USCF ETF Trust, since May 2018. Mr. Allen has been a principal of USCF listed with the CFTC and NFA since March 2009 and has been registered as an associated person of USCF since July 2015 and from March 2008 to November 2012. Additionally, Mr. Allen has been approved as an NFA swaps associated person of USCF since July 2015. As of February 2017, he also is an associated person and swap associated person of USCF Advisers, LLC ("USCF Advisers"). USCF Advisers, an affiliate of USCF, is an investment adviser registered under the Investment Advisers Act of 1940, and, as of February 2017, is registered as a commodity pool operator, NFA member and swap firm. Mr. Allen earned a B.A. in Economics from the University of California at Berkeley and holds an NFA Series 3 registration. Kevin A. Baum, 51, has served as the Chief Investment Officer of USCF since September 1, 2016 and as a Portfolio Manager of USCF from March 2016 to April 2017. Prior to joining USCF, Mr. Baum temporarily retired from December 2015 to March 2016. Mr. Baum served as the Vice President and Senior Portfolio Manager for Invesco, an investment manager that manages a family of exchange-traded funds, from October 2014 through December 2015. Mr. Baum was temporarily retired from May 2012 through September 2014. From May 1993 to April 2012, Mr. Baum worked as the Senior Portfolio Manager, Head of Commodities for OppenheimerFunds, Inc., a global asset manager. Mr. Baum has been approved as an NFA principal and associated person of USCF since April 2016, as well as a swap associated person of USCF from April 2016 through March 2020 and since November 2020. As of February 2017, he also is an associated person of USCF Advisers, and a swap associated person of USCF Advisers from February 2017 to March 2020 and since June 2021. Mr. Baum served as a branch manager of USCF Advisers from February 2017 through March 2021. Additionally, effective as of June 2021, he is a principal of USCF Advisers. USCF Advisers, an affiliate of USCF, is an investment adviser registered under the Investment Advisers Act of 1940, and, as of February 2017, is registered as a commodity pool operator, NFA member and swap firm. Mr. Baum is a CFA Charterholder, CAIA Charterholder, earned a B.B.A. in Finance from Texas Tech University and holds an NFA Series 3 registration. Stuart P. Crumbaugh, 58, Chief Financial Officer, Secretary and Treasurer of USCF since May 2015 and also the Chief Financial Officer of The Marygold Companies, Inc., formerly Concierge Technologies, Inc. ("Marygold"), the parent of Wainwright Holdings, Inc. ("Wainwright") since December 2017. He is also the Treasurer and a member of the Board of Directors of Marygold & Co., a subsidiary of Marygold, since November 2019. In addition, Mr. Crumbaugh has served as a director of Wainwright, the parent and sole member of USCF, since December 2016. Mr. Crumbaugh has been a principal of USCF listed with the CFTC and NFA since July 1, 2015 and, as of January 2017, he is a principal of USCF Advisers. USCF Advisers, an affiliate of USCF, is an investment adviser registered under the Investment Advisers Act of 1940, and, as of February 2017, is registered as a commodity pool operator, NFA member and swap firm. Since June 2015, Mr. Crumbaugh has been the Treasurer and Secretary of USCF Advisers. He has served as a Management Trustee, Chief Financial Officer and Treasurer of (1) USCF ETF Trust since May 2015 and (2) USCF Mutual Funds Trust since October 2016. Mr. Crumbaugh joined USCF as the Assistant Chief Financial Officer on April 6, 2015. Prior to joining USCF, Mr. Crumbaugh was the Vice President Finance and Chief Financial Officer of Sikka Software Corporation, a software service healthcare company providing optimization software and data solutions from April 2014 to April 6, 2015. Mr. Crumbaugh served as a consultant providing technical accounting, IPO readiness and M&A consulting services to various early stage companies with the Connor Group, a technical accounting consulting firm, for the periods of January 2014 through March 2014; October 2012 through November 2012; and January 2011 through February 2011. From December 2012 through December 2013, Mr. Crumbaugh was Vice President, Corporate Controller and Treasurer of Auction.com, LLC, a residential and commercial real estate online auction company. From March 2011 through September 2012, Mr. Crumbaugh was Chief Financial Officer of IP Infusion Inc., a technology company providing network routing and switching software enabling software-defined networking solutions for major mobile carriers and network infrastructure providers. Mr. Crumbaugh earned a B.A. in Accounting and Business Administration from Michigan State University in 1987 and is a Certified Public Accountant – Michigan (inactive). Daphne G. Frydman, 47, General Counsel of USCF and USCF Advisers, LLC since May 2018, and Director of Compliance of USCF since April 2022. She is also the Chief Legal Officer of USCF ETF Trust since May 2018 and Secretary of the same since December 2021. Ms. Frydman served as Deputy General Counsel of USCF and USCF Advisers, LLC from May 2016 through May 2018. From September 2001 through April 2016, Ms. Frydman was an attorney in private practice at the law firm Sutherland Asbill & Brennan LLP. Ms. Frydman s application to be a principal of USCF was submitted to the National Futures Association on April 1, 2022 and remains pending. Ms. Frydman earned her JD from the Northwestern University Pritzker School of Law and a B.A. in College of Letters and Spanish from Wesleyan University. Nicholas D. Gerber, 59, Vice President since May 15, 2015 and Management Director since June 2005. Mr. Gerber served as President and Chief Executive Officer of USCF from June 2005 through May 15, 2015 and Chairman of the Board of Directors of USCF from June 2005 through October 2019. Mr. Gerber co-founded USCF in 2005 and prior to that, he co-founded Ameristock Corporation in March 1995, a California-based investment adviser registered under the Investment Advisers Act of 1940 from March 1995 until January 2013. Since January 26, 2015, Mr. Gerber also has served as the Chief Executive Officer, President, and Chairman of the Board of Directors of Marygold, which is a company publicly traded under the ticker symbol "MGLD." Marygold is the sole shareholder of Wainwright. He is also the CEO and a member of the Board of Directors of Marygold & Co., a subsidiary of Marygold, since November 2019. Mr. Gerber also is the President and a director of Wainwright, a position he has held since March of 2004. From August 1995 to January 2013, Mr. Gerber served as Portfolio Manager of Ameristock Mutual Fund, Inc. On January 11, 2013, the Ameristock Mutual Fund, Inc. merged with and into the Drexel Hamilton Centre American Equity Fund, a series of Drexel Hamilton Mutual Funds. Drexel Hamilton Mutual Funds is not affiliated with Ameristock Corporation, the Ameristock Mutual Fund, Inc. or USCF. Mr. Gerber also has served USCF Advisers on the Board of Managers from June 2013 to present, as the President from June 2013 through June 18, 2015, and as Vice President from June 18, 2015 to present. USCF Advisers, an affiliate of USCF, is an investment adviser registered under the Investment Advisers Act of 1940, and, since February 2017, is registered as a commodity pool operator, NFA member and swap firm. He also has served as Chairman of the Boards of Trustees of USCF ETF Trust since 2014 and USCF Mutual Funds Trust since October 2016, respectively, (USCF ETF Trust and together with USCF Mutual Funds Trust are referred to as the "Trusts") and each of the Trusts are investment companies registered under the Investment Company Act of 1940, as amended. In addition, Mr. Gerber served as the President and Chief Executive Officer of USCF ETF Trust from June 2014 until December 2015. Mr. Gerber has been a principal of USCF listed with the CFTC and NFA since November 2005, an NFA associate member and associated person of USCF since December 2005. Additionally, effective as of January 2017, he is a principal of USCF Advisers and, effective as of February 2017, he is an associated person and swap associated person of USCF Advisers. Mr. Gerber earned an MBA degree in finance from the University of San Francisco, a B.A. from Skidmore College and holds an NFA Series 3 registration. John P. Love, 50, President and Chief Executive Officer of USCF since May 15, 2015, Management Director of USCF since October 2016 and Chairman of the Board of Directors of USCF since October 2019. Mr. Love also is a director of Wainwright, a position he has held since December 2016. Mr. Love previously served as a Senior Portfolio Manager for the Related Public Funds from March 2010 through May 15, 2015. Prior to that, while still at USCF, he was a Portfolio Manager beginning with the launch of USO in April 2006. Mr. Love was the portfolio manager of USO from April 2006 until March 2010 and the portfolio manager for USL from December 2007 until March 2010. Mr. Love has been the portfolio manager of UNG since April 2007, and the portfolio manager of UGA, UHN, and UNL since March 2010. Mr. Love has served as on the Board of Managers of USCF Advisers since November 2016 and as its President since June 18, 2015. USCF Advisers, an affiliate of USCF, is an investment adviser registered under the Investment Advisers Act of 1940, and, as of February 2017, is registered as a commodity pool operator, NFA member and swap firm. He also acted as co-portfolio manager of the Stock Split Index Fund, a series of the USCF ETF Trust for the period from September 2014 to December 2015, when he was promoted to the position of President and Chief Executive Officer of the USCF ETF Trust. Since October 2016 to present, he also has served as the President and Chief Executive of the USCF Mutual Funds Trust. Mr. Love has been a principal of USCF listed with the CFTC and NFA since January 17, 2006. Mr. Love has been registered as an associated person of USCF since February 2015 and from December 1, 2005 to April 16, 2009. Additionally, Mr. Love has been approved as an NFA swaps associated person since February 2015. Mr. Love is a principal of USCF Advisers LLC as of January 2017. Additionally, effective as of February 2017, he is an associated person and swap associated person of USCF Advisers. Mr. Love earned a B.A. from the University of Southern California, holds an NFA Series 3 and FINRA Series 7 registrations and is a CFA Charterholder. Andrew F Ngim, 61, co-founded USCF in 2005 and has served as a Management Director since May 2005 and, since August 15, 2016, has served as the Chief Operating Officer of USCF. Mr. Ngim has served as the portfolio manager for USCI and CPER since January 2013 and for the United States Agricultural Index Fund from January 2013 to September 2018. Mr. Ngim also served as USCF s Treasurer from June 2005 to February 2012. In addition, he has been on the Board of Managers and has served as the Assistant Secretary and Assistant Treasurer of USCF Advisers since its inception in June 2013 and Chief Operating Officer of USCF Advisers since March 2021. Prior to and concurrent with his services to USCF and USCF Advisers, from January 1999 to January 2013, Mr. Ngim served as a Managing Director for Ameristock Corporation, a California-based investment adviser, which he co-founded in March 1995, and was Co-Portfolio Manager of Ameristock Mutual Fund, Inc. from January 2000 to January 2013. Mr. Ngim also served as portfolio manager of (a) the following series of the USCF ETF Trust: (1) the Stock Split Index Fund from September 2014 to October 2017, (2) the USCF Restaurant Leaders Fund from November 2016 to October 2017, (3) USCF SummerHaven SHPEI Index Fund from December 2017 to October 2020, (4) USCF SummerHaven SHPEN Index Fund from December 2017 to April 2020, and (b) a series of USCF Mutual Funds Trust, the USCF Commodity Strategy Fund, from March 2017 to March 2019. Mr. Ngim also serves as the portfolio manager for the USCF SummerHaven Dynamic Commodity Strategy No K-1 Fund, a series of the USCF ETF Trust, from May 2018 to present. Mr. Ngim serves as a Management Trustee of: (1) the USCF ETF Trust from August 2014 to the present and (2) the USCF Mutual Funds Trust from October 2016 to present. Mr. Ngim has been a principal of USCF listed with the CFTC and NFA since November 2005 and a principal of USCF Advisers LLC since January 2017. USCF Advisers, an affiliate of USCF, is an investment adviser registered under the Investment Advisers Act of 1940, and, as of February 2017, is registered as a commodity pool operator, NFA member and swap firm. Mr. Ngim earned his B.A. from the University of California at Berkeley. Robert L. Nguyen, 62, Management Director and principal since July 2015. Mr. Nguyen served on the Board of Wainwright from December 2014 to December 2016. Mr. Nguyen co-founded USCF in 2005 and served as a Management Director until March 2012. Mr. Nguyen was an Investment Manager with Ribera Investment Management, an investment adviser registered under the Investment Advisers Act of 1940, from January 2013 to March 2015. Prior to and concurrent with his services to USCF, from January 2000 to January 2013, Mr. Nguyen served as a Managing Principal for Ameristock Corporation, a California-based investment adviser registered under the Investment Advisers Act of 1940, which he co-founded in March 1995. Mr. Nguyen was a principal of USCF listed with the CFTC and NFA from November 2005 through March 2012 and an associated person of USCF listed with the CFTC and NFA from November 2007 through March 2012. Mr. Nguyen has been a principal of USCF listed with the CFTC and NFA since July 2015 and an associated person of USCF listed with the CFTC and NFA since December 2015. As of February 2017, he also is an associated person of USCF Advisers. USCF Advisers, an affiliate of USCF, is an investment adviser registered under the Investment Advisers Act of 1940, and, as of February 2017, is registered as a commodity pool operator, NFA member and swap firm. Mr. Nguyen earned his B.S. from California State University at Sacramento, and holds NFA Series 3 and FINRA Series 7 registrations. Gordon L. Ellis, 75, Independent Director of USCF since September 2005. Previously, Mr. Ellis was a founder of International Absorbents, Inc., Director and Chairman since July 1985 and July 1988, respectively, and Chief Executive Officer and President since November 1996. He also served as Chairman of Absorption Corp., a wholly-owned subsidiary of International Absorbents, Inc., which is a leading developer and producer of environmentally friendly pet care and industrial products, from May July 1985 until July 2010 when it was sold to Kinderhook Industries, a private investment banking firm and remained as a director until March 2013 when Absorption Corp was sold again to J. Rettenmaier & S hne Group, a German manufacturing firm. Concurrent with that, he founded and has served as Chairman from November 2010 to present of Lupaka Gold Corp., a firm that acquires, explores and developed mining properties and is currently driving an arbitration suit against the Republic of Peru. He also serves as a director of Goldhaven Resources, a firm that acquires, explores and develops mining properties in Canada and Chile, from August 2020 to present. Mr. Ellis has his Chartered Directors designation from The Director s College (a joint venture of McMaster University and The Conference Board of Canada). He has been a principal of USCF listed with the CFTC and NFA since November 2005. Mr. Ellis is a professional engineer, retired, and earned an MBA in international finance. Malcolm R. Fobes III, 57, Independent Director of USCF and Chairman of USCF s audit committee since September 2005. He founded and is the Chairman and Chief Executive Officer of Berkshire Capital Holdings, Inc., a California-based investment adviser registered under the Investment Advisers Act of 1940 that has been sponsoring and providing portfolio management services to mutual funds since June 1997. Mr. Fobes serves as Chairman and President of The Berkshire Funds, a mutual fund investment company registered under the Investment Company Act of 1940. Since 1997, Mr. Fobes has also served as portfolio manager of the Berkshire Focus Fund, a mutual fund registered under the Investment Company Act of 1940, which concentrates its investments in the electronic technology industry. He was also contributing editor of Start a Successful Mutual Fund: The Step-by-Step Reference Guide to Make It Happen (JV Books, 1995). Mr. Fobes has been a principal of USCF listed with the CFTC and NFA since November 2005. He earned a B.S. in finance with a minor in economics from San Jose State University in California. Peter M. Robinson, 64, Independent Director of USCF since September 2005. Mr. Robinson has been a Research Fellow since 1993 with the Hoover Institution, a public policy think tank located on the campus of Stanford University. He authored three books and has been published in the New York Times, Red Herring, and Forbes ASAP and is the editor of Can Congress Be Fixed?: Five Essays on Congressional Reform (Hoover Institution Press, 1995). Mr. Robinson has been a principal of USCF listed with the CFTC and NFA since December 2005. He earned an MBA from the Stanford University Graduate School of Business, graduated from Oxford University in 1982 after studying politics, philosophy, and economics and graduated summa cum laude from Dartmouth College in 1979. UNL s Service Providers Custodian, Registrar, Transfer Agent, and Administrator In its capacity as the Custodian for UNL, the Custodian holds UNL s Treasuries, cash and/or cash equivalents pursuant to a custodial agreement. In addition, in its capacity as Administrator for UNL, BNY Mellon performs certain administrative and accounting services for UNL and prepares certain SEC, NFA and CFTC reports on behalf of UNL. As compensation for the services that BNY Mellon provides to UNL in the foregoing capacities, and the services BNY Mellon provides to the Related Public Funds, BNY Mellon receives certain out of pocket costs, transaction fees, and asset based fees, which are accrued daily and paid monthly by USCF. BNY Mellon is authorized to conduct a commercial banking business in accordance with the provisions of New York State Banking Law, and is subject to regulation, supervision, and examination by the New York State Department of Financial Services and the Board of Governors of the Federal Reserve System. Marketing Agent UNL also employs ALPS Distributors, Inc. ("ALPS Distributors") as the Marketing Agent, which is further discussed under "What is the Plan of Distribution?" USCF pays the Marketing Agent an annual fee. In no event may the aggregate compensation paid to the Marketing Agent and any affiliate of USCF for distribution-related services in connection with the offering of shares exceed ten percent (10%) of the gross proceeds of the offering. ALPS Distributors principal business address is 1290 Broadway, Suite 1000, Denver, CO 80203. ALPS Distributors is a broker-dealer registered with the SEC and is a member of FINRA and a member of the Securities Investor Protection Corporation. Payments to Certain Third Parties USCF or the Marketing Agent, or an affiliate of USCF or the Marketing Agent, may directly or indirectly make cash payments to certain broker-dealers for participating in activities that are designed to make registered representatives and other professionals more knowledgeable about exchange-traded funds and exchange-traded products, including UNL and the Related Public Funds, or for other activities, such as participation in marketing activities and presentations, educational training programs, conferences, the development of technology platforms and reporting systems. Additionally, pursuant to written agreements, USCF may make payments, out of its own resources, to financial intermediaries in exchange for providing services in connection with the sale or servicing of UNL s shares, including waiving commissions on the purchase or sale of shares of participating exchange-traded products. Payments to a broker-dealer or intermediary may create potential conflicts of interest between the broker-dealer or intermediary and its clients. The amounts described above, which may be significant, are paid by USCF and/or the Marketing Agent from their own resources and not from the assets of UNL or the Related Public Funds. Futures Commission Merchants RBC Capital Markets, LLC On October 8, 2013, USCF entered into a Futures and Cleared Derivatives Transactions Customer Account Agreement with RBC Capital Markets, LLC ("RBC Capital" or "RBC") to serve as UNL s FCM, effective October 10, 2013. This agreement requires RBC Capital to provide services to UNL, as of October 10, 2013, in connection with the purchase and sale of Futures Contracts and Other Natural Gas-Related Investments that may be purchased or sold by or through RBC Capital for UNL s account. For the period October 10, 2013 and after, UNL pays RBC Capital commissions for executing and clearing trades on behalf of UNL. RBC Capital s primary address is 30 Hudson Street, 27th Floor, Jersey City, NJ 07302 . Effective October 10, 2013, RBC Capital became the futures clearing broker for UNL. RBC Capital is registered in the United States with FINRA as a broker-dealer and with the CFTC as an FCM. RBC Capital is a member of various U.S. futures and securities exchanges. RBC Capital is a large broker dealer subject to many different complex legal and regulatory requirements. As a result, certain of RBC Capital s regulators may from time to time conduct investigations, initiate enforcement proceedings and/or enter into settlements with RBC Capital with respect to issues raised in various investigations. RBC Capital complies fully with its regulators in all investigations being conducted and in all settlements it reaches. In addition, RBC Capital is and has been subject to a variety of civil legal claims in various jurisdictions, a variety of settlement agreements and a variety of orders, awards and judgments made against it by courts and tribunals, both in regard to such claims and investigations. RBC Capital complies fully with all settlements it reaches and all orders, awards and judgments made against it. RBC Capital has been named as a defendant in various legal actions, including arbitrations, class actions and other litigation including those described below, arising in connection with its activities. Certain of the actual or threatened legal actions include claims for substantial compensatory and/or punitive damages or claims for indeterminate amounts of damages. RBC Capital is also involved, in other reviews, investigations and proceedings (both formal and informal) by governmental and self-regulatory agencies regarding RBC Capital s business, including among other matters, accounting and operational matters, certain of which may result in adverse judgments, settlements, fines, penalties, injunctions or other relief. RBC Capital contests liability and/or the amount of damages as appropriate in each pending matter. In view of the inherent difficulty of predicting the outcome of such matters, particularly in cases where claimants seek substantial or indeterminate damages or where investigations and proceedings are in the early stages, RBC Capital cannot predict the loss or range of loss, if any, related to such matters; how or if such matters will be resolved; when they will ultimately be resolved; or what the eventual settlement, fine, penalty or other relief, if any, might be. Subject to the foregoing, RBC Capital believes, based on current knowledge and after consultation with counsel, that the outcome of such pending matters will not have a material adverse effect on the consolidated financial condition of RBC Capital. On April 27, 2017, pursuant to an offer of settlement, a Panel of the Chicago Board of Trade Business Conduct Committee ("Panel") found that RBC Capital engaged in EFRP transactions which failed to satisfy the Rules of the Chicago Board of Trade (the "Chicago Board of Trade") in one or more ways. Specifically, the Panel found that RBC Capital traders entered into EFRP trades in which RBC Capital accounts were on both sides of the transactions. While the purpose of the transactions was to transfer positions between the RBC Capital accounts, the Panel found that the manner in which the trades occurred violated the Chicago Board of Trade s prohibition on wash trades. The Panel found that RBC Capital thereby violated CBOT Rules 534 and (legacy) 538.B. and C. In accordance with the settlement offer, the Panel ordered RBC Capital to pay a $175,000 fine. On October 1, 2019, the CFTC issued an order filing and settling charges against RBCCM for the above activity, as well as related charges. The order required that RBCCM cease and desist from violating the applicable regulations, pay a $5 million civil monetary penalty, and comply with various conditions, including conditions regarding public statements and future cooperation with the Commission. Various regulators are conducting inquiries regarding potential violations of antitrust law by a number of banks and other entities, including RBC Capital, regarding foreign exchange trading. Beginning in 2015, putative class actions were brought against RBC Capital and/or Royal Bank of Canada, RBC Capital s indirect parent, in the U.S. and Canada. These actions were each brought against multiple foreign exchange dealers and allege, among other things, collusive behavior in global foreign exchange trading. In August 2018, the U.S. District Court entered a final order approving RBC s settlement with class plaintiffs. In November 2018, certain institutional plaintiffs who had previously opted-out of participating in the settlement filed their own lawsuit in U.S. District Court. In May 2020, the U.S. District Court dismissed RBC from the opt-out action, but granted the plaintiffs motion to amend the complaint. The Canadian class actions remain pending and RBC Capital has reached a settlement for an immaterial amount with respect to an action brought by a class of indirect purchasers. RBC Capital is awaiting the court s final approval of the settlement. Based on the facts currently known, it is not possible at this time for management to predict the ultimate outcome of these collective matters or the timing of their ultimate resolution. On April 13, 2015, RBC Capital s affiliate, Royal Bank of Canada Trust Company (Bahamas) Limited (RBC Bahamas), was charged in France with complicity in tax fraud. RBC Bahamas believes that its actions did not violate French law and contested the charge in the French court. The trial of this matter has concluded and a verdict was delivered on January 12, 2017, acquitting the company and the other defendants and on June 29, 2018, the French appellate court affirmed the acquittals. The acquittals are being appealed. Various regulators and competition and enforcement authorities around the world, including in Canada, the United Kingdom, and the U.S., are conducting investigations related to certain past submissions made by panel banks in connection with the setting of the U.S. dollar London interbank offered rate ("LIBOR"). These investigations focus on allegations of collusion between the banks that were on the panel to make submissions for certain LIBOR rates. Royal Bank of Canada is a member of certain LIBOR panels, including the U.S. dollar LIBOR panel, and has in the past been the subject of regulatory requests for information. In addition, Royal Bank of Canada and other U.S. dollar panel banks have been named as defendants in private lawsuits filed in the U.S. with respect to the setting of LIBOR including a number of class action lawsuits which have been consolidated before the U.S. District Court for the Southern District of New York. The complaints in those private lawsuits assert claims against us and other panel banks under various U.S. laws, including U.S. antitrust laws, the CEA, and state law. On February 28, 2018, the motion by the plaintiffs in the class action lawsuits to have the class certified was denied in relation to Royal Bank of Canada. As such, unless that ruling is reversed on appeal, Royal Bank of Canada is no longer a defendant in any pending class action. Royal Bank of Canada is still a party to the various individual LIBOR actions. In addition to the LIBOR actions, in January 2019, a number of financial institutions, including RBC Capital, were named in a purported class action in New York alleging violations of the U.S. anti-trust laws and common law principles of unjust enrichment in the setting of LIBOR after the Intercontinental Exchange took over administration of the benchmark interest rate from the British Bankers Association in 2014 (the "ICE LIBOR action"). On March 26, 2020, the defendants motion to dismiss the ICE LIBOR action was granted. On April 24, 2020, the plaintiffs filed a notice of appeal. In August 2020, RBC Capital settled an individual LIBOR action brought by the City of Philadelphia. Based on the facts currently known, it is not possible at this time to predict the ultimate outcome of these proceedings or the timing of their resolution. Please see RBC Capital s Form BD, which is available on the FINRA BrokerCheck program, for more details. RBC Capital will act only as clearing broker for UNL and as such will be paid commissions for executing and clearing trades on behalf of UNL. RBC Capital has not passed upon the adequacy or accuracy of this disclosure document. RBC Capital will not act in any supervisory capacity with respect to USCF or participate in the management of USCF or UNL. RBC Capital is not affiliated with UNL or USCF. Therefore, neither USCF nor UNL believes that there are any conflicts of interest with RBC Capital or its trading principals arising from its acting as UNL s FCM. RCG Division of Marex Spectron On May 28, 2020, UNL entered into a Commodity Futures Customer Agreement with RCG Division of Marex Spectron ("RCG") to serve as an FCM for UNL. This agreement requires RCG to provide services to UNL in connection with the purchase and sale of Futures Contracts and Other Natural Gas-Related Investments that may be purchased or sold by or through RCG for UNL s account. Under this agreement, UNL pays RCG commissions for executing and clearing trades on behalf of UNL. RCG s primary address is 360 Madison Avenue, 3rd Floor, New York, NY 10017. RCG is registered in the United States with FINRA as a broker-dealer and with the CFTC as an FCM. RCG is a member of various U.S. futures and securities exchanges. RCG is a large broker dealer subject to many different complex legal and regulatory requirements. Other than as set forth below, as a result, certain of RCG s regulators may from time to time conduct investigations, initiate enforcement proceedings and/or enter into settlements with RCG with respect to issues raised in various investigations. RCG complies fully with its regulators in all investigations which may be conducted and in all settlements it may reach. As of the date hereof, RCG has no material litigation to disclose as that term is defined under the CEA and the regulations promulgated thereunder. On September 23, 2020, without admitting or denying the CFTC s findings or conclusions, RCG settled a CFTC administrative action arising out of RCG s failure to include regulatory capital deductions in its capital computation in connection with an agreement to guarantee a revolving line of credit for an affiliated company. The CFTC alleged that, from June 2015 until June 2019, RCG failed to include a regulatory capital deduction in its capital computation equal to the amounts drawn under the credit facility by its United Kingdom affiliate. In connection with the settlement, RCG paid a civil monetary penalty of $250,000. RCG will act only as clearing broker for UNL and as such will be paid commissions for executing and clearing trades on behalf of UNL. RCG has not passed upon the adequacy or accuracy of this disclosure document. RCG will not act in any supervisory capacity with respect to USCF or participate in the management of USCF or UNL. RCG is not affiliated with UNL or USCF. Therefore, neither USCF nor UNL believes that there are any conflicts of interest with RCG or its trading principals arising from its acting as UNL s FCM. E D & F Man Capital Markets Inc. On June 5, 2020, UNL entered into a Customer Agreement E D & F Man Capital Markets Inc. ("MCM") to serve as an FCM for UNL. This agreement requires MCM to provide services to UNL in connection with the purchase and sale of Futures Contracts and Other Natural Gas-Related Investments that may be purchased or sold by or through MCM for UNL s account. Under this agreement, UNL pays MCM commissions for executing and clearing trades on behalf of UNL. MCM s primary address is 140 East 45th Street, 10th Floor, New York, NY 10017. MCM is registered in the United States with FINRA as a broker-dealer and with the CFTC as an FCM. MCM is a member of various U.S. futures and securities exchanges. MCM is a large broker dealer subject to many different complex legal and regulatory requirements. As a result, certain of MCM s regulators may from time to time conduct investigations, initiate enforcement proceedings and/or enter into settlements with MCM with respect to issues raised in various investigations. MCM complies fully with its regulators in all investigations which may be conducted and in all settlements it may reach. Other than as indicated below, there have been no material civil, administrative, or criminal proceedings pending, on appeal, or concluded against MCM or its principals in the past five (5) years. United States District Court for the Southern District of New York, Civil Action No. 19-CV-8217. In a private litigation, plaintiffs allege, among other things, that MCM made certain fraudulent misrepresentations to them that they relied upon in connection with a futures account carried by MCM in its capacity as an FCM. The plaintiffs allege claims of common law fraud, negligence, breach of fiduciary duty, breach of contract, breach of the duty of good faith and fair dealing and misrepresentation/omission. On June 30, 2021, an order was entered ruling against the plaintiffs an in favor of MCM. Judgment was entered in favor of MCM in the amount of $1,762,266.56, plus prejudgment interest and attorneys fees and costs. On September 29, 2021, an order was entered in which MCM was awarded $1,402,234.32 in attorneys fees and costs. JAMS Arbitration. In a JAMS arbitration, claimants seek monetary damages relating to trading losses in claimants futures trading accounts carried by MCM. JAMS is a private alternative dispute resolution provider that handles mediations and arbitrations in the United States and other jurisdictions. The MCM accounts at issue were traded pursuant to a power of attorney granted by the claimants to a registered commodity trading advisor. The claimants seek compensatory damages, punitive damages, disgorgement of commissions and margin interest, and forgiveness of margin debt plus interest, costs and attorneys fees. On September 23, 2021, the claimants and MCM settled the matter. FINRA Arbitration. In a FINRA arbitration, claimants seek monetary damages relating to trading losses in claimants equity trading account carried by MCM. The account was a portfolio margin account and the claimants allege losses relating to the risk parameters and margin applied to the account. The claimants seek compensatory damages plus interest, costs and attorneys fees. MCM will act only as clearing broker for UNL and as such will be paid commissions for executing and clearing trades on behalf of UNL. MCM has not passed upon the adequacy or accuracy of this disclosure document. MCM will not act in any supervisory capacity with respect to USCF or participate in the management of USCF or UNL. MCM is not affiliated with UNL or USCF. Therefore, neither USCF nor UNL believes that there are any conflicts of interest with MCM or its trading principals arising from its acting as UNL s FCM. Macquarie Futures USA LLC On December 3, 2020, UNL engaged Macquarie Futures USA LLC ("MFUSA") to serve as an additional FCM. The Customer Agreement between UNL and MFUSA requires MFUSA to provide services to UNL in connection with the purchase and sale of futures contracts for natural gas and Other Natural Gas-Related Investments that may be purchased or sold by or through MFUSA for UNL s account. Under this agreement, UNL pays MFUSA commissions for executing and clearing trades on behalf of UNL. MFUSA s primary address is 125 West 55th Street, New York, NY 10019. MFUSA is registered in the United States with the CFTC as an FCM providing futures execution and clearing services covering futures exchanges globally. MFUSA is a member of various U.S. futures and securities exchanges. MFUSA is a large broker dealer subject to many different complex legal and regulatory requirements. As a result, certain of MFUSA s regulators may from time to time conduct investigations, initiate enforcement proceedings and/or enter into settlements with MFUSA with respect to issues raised in various investigations. MFUSA complies fully with its regulators in all investigations which may be conducted and in all settlements it may reach. As of the date hereof, MFUSA has no material litigation to disclose as that term is defined under the CEA and the regulations promulgated thereunder. MFUSA will act only as clearing broker for UNL and as such will be paid commissions for executing and clearing trades on behalf of UNL. MFUSA has not passed upon the adequacy or accuracy of this disclosure document. MFUSA will not act in any supervisory capacity with respect to USCF or participate in the management of USCF or UNL. MFUSA is not affiliated with UNL or USCF. Therefore, neither USCF nor UNL believes that there are any conflicts of interest with MFUSA or its trading principals arising from its acting as UNL s FCM. Commodity Trading Advisor Currently, USCF does not employ commodity trading advisors for the trading of UNL contracts. USCF currently does, however, employ SummerHaven Investment Management, LLC as a commodity trading advisor for USCF s own account and for USCI and CPER. If, in the future, USCF employs commodity trading advisors for UNL, it will choose each advisor based on arm s-length negotiations and will consider the advisor s experience, fees and reputation. UNL s Fees and Expenses This table describes the fees and expenses that you may pay if you buy and hold shares of UNL. You should note that you may pay brokerage commissions on purchases and sales of UNL s shares, which are not reflected in the table. Authorized Participants will pay applicable creation and redemption fees. See "Creation and Redemption of Shares—Creation and Redemption Transaction Fee," page 72 . Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment) Management Fees(1) 0.75% Other Expenses(1) 1.28% Expense Waiver(2) (1.13)% Net Expenses Excluding Management Fees 0.15% Total Annual Fund Operating Expenses After Fee Waiver 0.90% (1)Based on amounts for the year ended December 31, 2021, which is incorporated by reference into this prospectus. See "Incorporation By Reference of Certain Information," page 75 . The individual expense amounts in dollar terms are shown in the table below. As used in this table, (i) Professional Expenses include expenses for legal, audit, tax, accounting and printing; and (ii) Independent Director and Officer Expenses include amounts paid to independent directors and for officers liability insurance. Management fees $85,770 Professional Expenses $128,233 Brokerage commissions $3,199 Independent Director and Officer Expenses $12,755 License fees $1,716 These amounts are based on UNL s average total net assets, which are the sum of daily total net assets of UNL divided by the number of calendar days in the year. For the year ended December 31, 2021, UNL s average total net assets were $11,436,019 (2)USCF has voluntarily agreed to pay certain expenses typically borne by UNL. USCF has no obligation to continue such payment. If this agreement were terminated, the Annual Fund Operating Expenses could increase, which would negatively impact your total return from an investment in UNL. Breakeven Analysis The breakeven analysis below indicates the approximate dollar returns and percentage required for the redemption value of a hypothetical initial investment in a single share to equal the amount invested twelve months after the investment was made. For purposes of this breakeven analysis, we have assumed an initial selling price of $14.28 per share which equals the NAV per share on February 28, 2022. In order for a hypothetical investment in shares to break even over the next 12 months, assuming a selling price of $14.28, the investment would have to generate a 0.861 % return or $ 0.123 , rounded to $ 0.12 . The amount for this breakeven analysis takes into account a fee waiver, which USCF may terminate at any time in its discretion. This breakeven analysis refers to the redemption of baskets by Authorized Participants and is not related to any gains an individual investor would have to achieve in order to break even. The breakeven analysis is an approximation only. Assumed initial selling price per share(1) $14.28 Management Fee (0.750%)(2) $0.107 Creation Basket Fee (0.01%)(3) $(0.001) Estimated Brokerage Fee 0.03%(4) $0.004 Interest Income 0.030%(5) $(0.004) New York Mercantile Exchange Licensing Fee 0.015%(6) $0.002 Independent Director and Officer Expenses (0.112%)(7) $0.016 Professional Expenses 1.121%(8) $ 0.160 Amount of trading income (loss) required for the redemption value at the end of one year to equal the initial selling price of the share $ 0.284 Percentage of initial selling price per share 1.988 % Expense Waiver (1.13)%(9) $(0.161) Amount of trading income (loss) required for the redemption value at the end of one year to equal the initial selling price of the unit (inclusive of credit) $ 0.123 Percentage of initial selling price per unit (inclusive of credit) 0.861 % (1)In order to show how a hypothetical investment in shares would break even over the next 12 months, this breakeven analysis uses an assumed initial selling price of $14.28 per share, which is based on the NAV per share for UNL at the close of trading on February 28, 2022. Investors should note that, because UNL s NAV changes on a daily basis, the breakeven amount on any given day could be higher or lower than the amount reflected here. (2)UNL is contractually obligated to pay USCF a management fee of 0.75% per annum on its average total net assets. "Average total net assets" are the sum of the daily total net assets of UNL (the NAV of UNL calculated as set forth in "Calculating Per Share NAV" beginning on page 68 ) divided by the number of calendar days in the year. On days when markets are closed, the daily total net assets are the daily total net assets from the last day when the market was open. See page 7 for a discussion of net assets of UNL. (3)Authorized Participants are required to pay a Creation Basket fee of $350 for each order they place to create one or more baskets. This breakeven analysis assumes a hypothetical investment in a single share, which would equal the $350 Creation Basket fee divided by the total number of outstanding shares plus the 50,000 shares created by the Creation Basket. This calculation will always result in a value that is below 0.010%, but for purposes of this breakeven analysis we assume a creation basket fee of 0.010%. (4)This amount is based on the actual brokerage fees for UNL calculated on an annualized basis and includes an estimated half-turn commission of $3.50. A half-turn commission is the commissions liability related to FCM transaction fees for futures contracts on a half-turn basis. (5)Interest earned on UNL s assets, including its Treasuries holdings. (6)The NYMEX Licensing Fee is 0.015% of the aggregate net assets of UNL and the Related Public Funds (except for BNO, USCI, and CPER). For more information, see "UNL s Fees and Expenses." (7)Independent Director and Officer Expenses include amounts paid to independent directors and for officers liability insurance. The foregoing assumes that the average total net assets of UNL as of December 31, 2021, which were $11,436,019, were aggregated with the average total net assets of the Related Public Funds as of December 31, 2021, that the aggregate fees paid to the independent directors for the year ended December 31, 2021 was $1,081,963 and that the allocable portion of the fees borne by UNL based on the proportion of its average total net assets when aggregated with the average total net assets of the Related Public Funds equals $12,755. (8)Professional Expenses include expenses for legal, audit, tax accounting and printing. UNL estimates the costs attributable to Professional Expenses for the year ended December 31, 2021 is $128,233. The number in the break-even table assumes UNL had $11,436,019 in average total net assets during the calendar year ended December 31, 2021. (9)USCF has voluntarily agreed to pay certain expenses typically borne by UNL. Conflicts of Interest There are present and potential future conflicts of interest in UNL s structure and operation you should consider before you purchase shares. USCF will use this notice of conflicts as a defense against any claim or other proceeding made. If USCF is not able to resolve these conflicts of interest adequately, it may impact UNL and the Related Public Funds ability to achieve their investment objectives. UNL and USCF may have inherent conflicts to the extent USCF attempts to maintain UNL s asset size in order to preserve its fee income and this may not always be consistent with UNL s objective of having the value of its share s NAV track changes in the average price of the Benchmark Futures Contracts. USCF s officers, directors and employees, do not devote their time exclusively to UNL. These persons are directors, officers or employees of other entities which may compete with UNL for their services, including the Related Public Funds. They could have a conflict between their responsibilities to UNL and to those other entities. USCF has adopted policies that prohibit their principals, officers, directors and employees from trading futures and related contracts in which either UNL or any of the Related Public Funds invests. These policies are intended to prevent conflicts of interest occurring where USCF, or their principals, officers, directors or employees could give preferential treatment to their own accounts or trade their own accounts ahead of or against UNL or any of the Related Public Funds. USCF has sole current authority to manage the investments and operations of UNL, and this may allow it to act in a way that furthers its own interests which may create a conflict with your best interests. Limited partners have limited voting control, which will limit their ability to influence matters such as amendment of the LP Agreement, change in UNL s basic investment policy, dissolution of UNL, or the sale or distribution of UNL s assets. USCF serves as the general partner to UNL and general partner or sponsor to the Related Public Funds. USCF may have a conflict to the extent that its trading decisions for UNL may be influenced by the effect they would have on the other funds it manages. By way of example, if, as a result of reaching position limits imposed by the NYMEX, UNL purchased gasoline futures contracts, this decision could impact UNL s ability to purchase additional gasoline futures contracts, if the number of contracts held by funds managed by USCF reached the maximum allowed by the NYMEX. Similar situations could adversely affect the ability of any fund to track its benchmark futures contract. In addition, USCF is required to indemnify the officers and directors of the Related Public Funds, if the need for indemnification arises. This potential indemnification will cause USCF s assets to decrease. If USCF s other sources of income are not sufficient to compensate for the indemnification, then USCF may terminate and you could lose your investment. Whenever a conflict of interest exists or arises between USCF on the one hand, and the partnership or any limited partner, on the other hand, any resolution or course of action by USCF in respect of such conflict of interest shall be permitted and deemed approved by all partners and shall not constitute a breach of the LP Agreement or of any agreement contemplated hereby or of a duty stated or implied by law or equity, if the resolution or course of action is, or by operation of the LP Agreement is deemed to be, fair and reasonable to the partnership. If a dispute arises, under the LP Agreement it will be resolved either through negotiations with USCF or by courts located in the State of Delaware. Under the LP Agreement, any resolution is deemed to be fair and reasonable to the partnership if the resolution is: approved by the audit committee, although no party is obligated to seek approval and USCF may adopt a resolution or course of action that has not received approval; on terms no less favorable to the limited partners than those generally being provided to or available from unrelated third parties; or fair to the limited partners, taking into account the totality of the relationships of the parties involved including other transactions that may be particularly favorable or advantageous to the limited partners. The previous risk factors and conflicts of interest are complete as of the date of this prospectus; however, additional risks and conflicts may occur which are not presently foreseen by USCF. You may not construe this prospectus as legal or tax advice. Before making an investment in UNL, you should read this entire prospectus, which can be found on UNL s website at www.uscfinvestments.com. You should also consult with your personal legal, tax, and other professional advisors. Interests of Named Experts and Counsel USCF has employed Eversheds Sutherland (US) LLP to prepare this prospectus. Neither the law firm nor any other expert hired by UNL to give advice on the preparation of this offering document has been hired on a contingent fee basis. None of them have any present or future expectation of interest in USCF, Marketing Agent, Authorized Participants, Custodian, Administrator or other service providers to UNL. Ownership or Beneficial Interest in UNL As of February 28, 2022, neither USCF nor any of the directors or executive officers of USCF own any shares of UNL. As of such date, Stifel, Nicolaus & Company, Incorporated is a beneficial owner of 144,556 shares of UNL, which represents a 7.81% ownership of UNL shares. USCF s Responsibilities and Remedies Pursuant to the DRULPA ("Delaware Revised Uniform Limited Partnership Act"), parties may contractually modify or even eliminate fiduciary duties in a limited partnership agreement to the limited partnership itself, or to another partner or person otherwise bound by the limited partnership agreement. Parties may not, however, eliminate the implied covenant of good faith and fair dealing. Where parties unambiguously provide for fiduciary duties in a limited partnership agreement, those expressed duties become the standard that courts will use to determine whether such duties were breached. For this reason, UNL s limited partnership agreement does not explicitly provide for any fiduciary duties so that common law fiduciary duty principles will apply to measure USCF s conduct. A prospective investor should be aware that USCF has a responsibility to limited partners of UNL to exercise good faith and fairness in all dealings. The fiduciary responsibility of USCF to limited partners is a developing and changing area of the law and limited partners who have questions concerning the duties of USCF should consult with their counsel. In the event that a limited partner of UNL believes that USCF has violated its fiduciary duty to the limited partners, he may seek legal relief individually or on behalf of UNL under applicable laws, including under DRULPA and under commodities laws, to recover damages from or require an accounting by USCF. Limited partners may also have the right, subject to applicable procedural and jurisdictional requirements, to bring class actions in federal court to enforce their rights under the federal securities laws and the rules and regulations promulgated thereunder by the SEC. Limited partners who have suffered losses in connection with the purchase or sale of the shares may be able to recover such losses from USCF where the losses result from a violation by USCF of the federal securities laws. State securities laws may also provide certain remedies to limited partners. Limited partners should be aware that performance by USCF of its fiduciary duty to is measured by the terms of the LP Agreement as well as applicable law. Limited partners are afforded certain rights to institute reparations proceedings under the CEA for violations of the CEA or of any rule, regulation or order of the CFTC by USCF. Liability and Indemnification Under the LP Agreement, neither a general partner nor any employee or other agent of UNL nor any officer, director, stockholder, partner, employee or agent of a general partner (a "Protected Person") shall be liable to any partner or UNL for any mistake of judgment or for any action or inaction taken, nor for any losses due to any mistake of judgment or to any action or inaction or to the negligence, dishonesty or bad faith of any officer, director, stockholder, partner, employee, agent of UNL or any officer, director, stockholder, partner, employee or agent of such general partner, provided that such officer, director, stockholder, partner, employee, or agent of the partner or officer, director, stockholder, partner, employee or agent of such general partner was selected, engaged or retained by such general partner with reasonable care, except with respect to any matter as to which such general partner shall have been finally adjudicated in any action, suit or other proceeding not to have acted in good faith in the reasonable belief that such Protected Person s action was in the best interests of UNL and except that no Protected Person shall be relieved of any liability to which such Protected Person would otherwise be subject by reason of willful misfeasance, gross negligence or reckless disregard of the duties involved in the conduct of the Protected Person s office. UNL shall, to the fullest extent permitted by law, but only out of UNL assets, indemnify and hold harmless a general partner and each officer, director, stockholder, partner, employee or agent thereof (including persons who serve at UNL s request as directors, officers or trustees of another organization in which UNL has an interest as a shareholder, creditor or otherwise) and their respective Legal Representatives and successors (hereinafter referred to as a "Covered Person") against all liabilities and expenses, including but not limited to amounts paid in satisfaction of judgments, in compromise or as fines and penalties, and counsel fees reasonably incurred by any Covered Person in connection with the defense or disposition of any action, suit or other proceedings, whether civil or criminal, before any court or administrative or legislative body, in which such Covered Person may be or may have been involved as a party or otherwise or with which such person may be or may have been threatened, while in office or thereafter, by reason of an alleged act or omission as a general partner or director or officer thereof, or by reason of its being or having been such a general partner, director or officer, except with respect to any matter as to which such Covered Person shall have been finally adjudicated in any such action, suit or other proceeding not to have acted in good faith in the reasonable belief that such Covered Person s action was in the best interest of UNL, and except that no Covered Person shall be indemnified against any liability to UNL or limited partners to which such Covered Person would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of such Covered Person s office. Expenses, including counsel fees so incurred by any such Covered Person, may be paid from time to time by UNL in advance of the final disposition of any such action, suit or proceeding on the condition that the amounts so paid shall be repaid to UNL if it is ultimately determined that the indemnification of such expenses is not authorized hereunder. Meetings Meetings of limited partners may be called by USCF and may be called by it upon the written request of limited partners holding at least 20% of the outstanding shares of UNL. USCF shall deposit written notice to all limited partners of the meeting and the purpose of the meeting, which shall be held on a date not less than 30 nor more than 60 days after the date of mailing of such notice, at a reasonable time and place. USCF may also call a meeting upon not less than 20 and not more than 60 days prior notice. Each limited partner appoints USCF and each of its authorized officers as its attorney-in-fact with full power and authority in its name, place and stead to execute, swear to, acknowledge, deliver, file and record all ballots, consents, approval waivers, certificates and other instruments necessary or appropriate, in the sole discretion of USCF, to make, evidence, give, confirm or ratify any vote, consent, approval, agreement or other action that is made or given by the partner of UNL. However, when the LP Agreement establishes a percentage of the limited partners required to take any action, USCF may exercise such power of attorney made only after the necessary vote, consent or approval of the limited partners. Termination Events UNL will dissolve at any time upon the happening of any of the following events: The bankruptcy, dissolution, withdrawal, or removal of USCF, unless a majority in interest of the limited partners within 90 days after such event elects to continue UNL and appoints a successor general partner; or The affirmative vote of a majority in interest of the limited partners, provided that prior to or concurrently with such vote, there shall have been established procedures for the assumption of UNL s obligations arising under any agreement to which UNL is a party and which is still in force immediately prior to such vote regarding termination, and there shall have been an irrevocable appointment of an agent who shall be empowered to give and receive notices, reports and payments under such agreements, and hold and exercise such other powers as are necessary to permit all other parties to such agreements to deal with such agent as if the agent were the sole owner of UNL s interest, which procedures are agreed to in writing by each of the other parties to such agreements. Provisions of Law According to applicable law, indemnification of USCF is payable only if USCF determined, in good faith, that the act, omission or conduct that gave rise to the claim for indemnification was in the best interest of UNL and the act, omission or activity that was the basis for such loss, liability, damage, cost or expense was not the result of negligence or misconduct and such liability or loss was not the result of negligence or misconduct by USCF, and such indemnification or agreement to hold harmless is recoverable only out of the assets of UNL and not from the members, individually. Provisions of Federal and State Securities Laws This offering is made pursuant to federal and applicable state securities laws. The SEC and state securities agencies take the position that indemnification of USCF that arises out of an alleged violation of such laws is prohibited unless certain conditions are met. Those conditions require that no indemnification of USCF or any underwriter for UNL may be made in respect of any losses, liabilities or expenses arising from or out of an alleged violation of federal or state securities laws unless: (i) there has been a successful adjudication on the merits of each count involving alleged securities law violations as to the party seeking indemnification and the court approves the indemnification; (ii) such claim has been dismissed with prejudice on the merits by a court of competent jurisdiction as to the party seeking indemnification; or (iii) a court of competent jurisdiction approves a settlement of the claims against the party seeking indemnification and finds that indemnification of the settlement and related costs should be made, provided that, before seeking such approval, USCF or other indemnitee must apprise the court of the position held by regulatory agencies against such indemnification. These agencies are the SEC and the securities administrator of the State or States in which the plaintiffs claim they were offered or sold membership interests. Provisions of the 1933 Act and NASAA Guidelines Insofar as indemnification for liabilities arising under the 1933 Act may be permitted to USCF or its directors, officers, or persons controlling UNL, UNL has been informed that the SEC and the various state administrators believe that such indemnification is against public policy as expressed in the 1933 Act and the North American Securities Administrators Association, Inc. ("NASAA") commodity pool guidelines and is therefore unenforceable. Books and Records UNL keeps its books of record and account at its office located at 1850 Mt. Diablo Boulevard, Suite 640, Walnut Creek, California 94596 or at the offices of the Administrator at its office located at 50 Post Office Square, Boston, Massachusetts, 02110, or such office, including of an administrative agent, as it may subsequently designate upon notice. These books and records are open to inspection by any person who establishes to UNL s satisfaction that such person is a limited partner upon reasonable advance notice at all reasonable times during the usual business hours of UNL. UNL keeps a copy of UNL s LP Agreement on file in its office which is available for inspection on reasonable advance notice at all reasonable times during its usual business hours by any limited partner. Statements, Filings, and Reports At the end of each fiscal year, UNL will furnish to banks, broker dealers and trust companies ("DTC Participants") for distribution to each person who is a shareholder at the end of the fiscal year an annual report containing UNL s audited financial statements and other information about UNL. USCF is responsible for the registration and qualification of the shares under the federal securities laws and federal commodities laws and any other securities and blue-sky laws of the United States or any other jurisdiction as USCF may select. USCF is responsible for preparing all reports required by the SEC, CFTC and the NYSE Arca, but has entered into an agreement with the Administrator to prepare these reports as required by the SEC, CFTC and the NYSE Arca on UNL s behalf. The financial statements of UNL will be audited, as required by law and as may be directed by USCF, by an independent registered public accounting firm designated from time to time by USCF. The accountants report will be furnished by UNL to shareholders upon request. UNL will make such elections, file such tax returns, and prepare, disseminate and file such tax reports, as it is advised by its counsel or accountants are from time to time required by any applicable statute, rule or regulation. Reports to Limited Partners In addition to periodic reports filed with the SEC, including annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, all of which can be accessed on the SEC s website at www.sec.gov or on UNL s website at www.uscfinvestments.com, UNL, pursuant to the LP Agreement, will provide the following reports to limited partners in the manner prescribed below: Annual Reports. Within 90 days after the end of each fiscal year, USCF shall cause to be delivered to each limited partner who was a limited partner at any time during the fiscal year, an annual report containing the following: (i)financial statements of the partnership, including, without limitation, a balance sheet as of the end of the partnership s fiscal year and statements of income, partners equity and changes in financial position, for such fiscal year, which shall be prepared in accordance with accounting principles generally accepted in the United States of America consistently applied and shall be audited by a firm of independent certified public accountants registered with the Public Company Accounting Oversight Board, (ii)a general description of the activities of the partnership during the period covered by the report, and (iii)a report of any material transactions between the partnership and USCF or any of its affiliates, including fees or compensation paid by the partnership and the services performed by USCF or any such affiliate for such fees or compensation. Quarterly Reports. Within 45 days after the end of each quarter of each fiscal year, USCF shall cause to be delivered to each limited partner who was a limited partner at any time during the quarter then ended, a quarterly report containing a balance sheet and statement of income for the period covered by the report, each of which may be unaudited but shall be certified by USCF as fairly presenting the financial position and results of operations of the partnership during the period covered by the report. The report shall also contain a description of any material event regarding the business of the partnership during the period covered by the report. Monthly Reports. Within 30 days after the end of each month, USCF shall cause to be posted on UNL s website and upon request, to be delivered to each limited partner who was a limited partner at any time during the month then ended, a monthly report containing an account statement, which will include a statement of income (loss) and a statement of changes in NAV, for the prescribed period. In addition, the account statement will disclose any material business dealings between the partnership, USCF, commodity trading advisor (if any), FCMs, or the principals thereof that previously have not been disclosed in this prospectus or any amendment thereto, other account statements or annual reports. UNL will provide information to its shareholders to the extent required by applicable SEC, CFTC, and NYSE Arca requirements. An issuer, such as UNL, of exchange-traded securities may not always readily know the identities of the investors who own those securities. UNL will post the same information that would otherwise be provided in UNL s reports to limited partners described above including its monthly account statements, which will include, without limitation, UNL s NAV, on UNL s website at www.uscfinvestments.com. Fiscal Year The fiscal year of UNL is the calendar year. USCF may select an alternate fiscal year. Governing Law; Consent to Delaware Jurisdiction The rights of USCF, UNL, DTC (as registered owner of UNL s global certificate for shares) and the shareholders, are governed by the laws of the State of Delaware. USCF, UNL and DTC and, by accepting shares, each DTC Participant and each shareholder, consent to the jurisdiction of the courts of the State of Delaware and any federal courts located in Delaware. Such consent is not required for any person to assert a claim of Delaware jurisdiction over USCF or UNL. Legal Matters Litigation and Claims From time to time, UNL may be involved in legal proceedings arising primarily out of the ordinary course of business. In addition, USCF, as the general partner of UNL and the Related Public Funds may, from time to time, be involved in litigation arising out of its operations in the ordinary course of business. Except as described herein, neither UNL nor USCF is currently party to any material legal proceedings. Optimum Strategies Action On April 6, 2022, USO and USCF were named as defendants in a putative class action filed by Optimum Strategies Fund I, LP, a purported investor in call option contracts on USO (the "Optimum Strategies Action"). The action is pending in the U.S. District Court for the District of Connecticut at Civil Action No. 3:22-cv-00511. The Optimum Strategies Action asserts claims under the Securities Exchange Act of 1934, as amended (the "1934 Act"), Rule 10b-5 thereunder, and the Connecticut Uniform Securities Act. It purports to challenge statements in registration statements that became effective in February 2020, March 2020, and on April 20, 2020, as well as public statements between February 2020 and May 2020, in connection with certain extraordinary market conditions and the attendant risks that caused the demand for oil to fall precipitously, including the COVID-19 global pandemic and the Saudi Arabia-Russia oil price war. The complaint seeks damages, interest, costs, attorney s fees, and equitable relief. USCF and USO intend to vigorously contest such claims. Settlement of SEC and CFTC Investigations On November 8, 2021, USCF and USO announced a resolution with each of the SEC and the CFTC relating to matters set forth in certain Wells Notices issued by the staffs of each of the SEC and CFTC as more fully described below. On August 17, 2020, USCF, USO, and John Love received a "Wells Notice" from the staff of the SEC (the "SEC Wells Notice"). The SEC Wells Notice stated that the SEC staff made a preliminary determination to recommend that the SEC file an enforcement action against USCF, USO, and Mr. Love alleging violations of Sections 17(a)(1) and 17(a)(3) of the Securities Act of 1933, as amended (the "1933 Act"), and Section 10(b) of the 1934 Act, and Rule 10b-5 thereunder. Subsequently, on August 19, 2020, USCF, USO, and Mr. Love received a Wells Notice from the staff of the CFTC (the "CFTC Wells Notice"). The CFTC Wells Notice stated that the CFTC staff made a preliminary determination to recommend that the CFTC file an enforcement action against USCF, USO, and Mr. Love alleging violations of Sections 4o(1)(A) and (B) and 6(c)(1) of the Commodity Exchange Act of 1936, as amended (the "CEA"), 7 U.S.C. 6o(1)(A) and (B) and 9(1) (2018), and CFTC Regulations 4.26, 4.41, and 180.1(a), 17 C.F.R. 4.26, 4.41, 180.1(a) (2019). On November 8, 2021, acting pursuant to an offer of settlement submitted by USCF and USO, the SEC issued an order instituting cease-and-desist proceedings, making findings, and imposing a cease-and-desist order pursuant to Section 8A of the 1933 Act, directing USCF and USO to cease and desist from committing or causing any violations of Section 17(a)(3) of the 1933 Act, 15 U.S.C. 77q(a)(3) (the "SEC Order"). In the SEC Order, the SEC made findings that, from April 24, 2020 to May 21, 2020, USCF and USO violated Section 17(a)(3) of 1933 Act, which provides that it is "unlawful for any person in the offer or sale of any securities to engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon the purchaser." USCF and USO consented to entry of the SEC Order without admitting or denying the findings contained therein, except as to jurisdiction. Separately, on November 8, 2021, acting pursuant to an offer of settlement submitted by USCF, the CFTC issued an order instituting cease-and-desist proceedings, making findings, and imposing a cease-and-desist order pursuant to Section 6(c) and (d) of the CEA, directing USCF to cease and desist from committing or causing any violations of Section 4o(1)(B) of the CEA, 7 U.S.C. 6o(1) (B), and CFTC Regulation 4.41(a)(2), 17 C.F.R. 4.41(a)(2) (the "CFTC Order"). In the CFTC Order, the CFTC made findings that, from on or about April 22, 2020 to June 12, 2020, USCF violated Section 4o(1)(B) of the CEA and CFTC Regulation 4.41(a)(2), which make it unlawful for any commodity pool operator ("CPO") to engage in "any transaction, practice, or course of business which operates as a fraud or deceit upon any client or participant or prospective client or participant" and prohibit a CPO from advertising in a manner which "operates as a fraud or deceit upon any client or participant or prospective client or participant," respectively. USCF consented to entry of the CFTC Order without admitting or denying the findings contained therein, except as to jurisdiction. Pursuant to the SEC Order and the CFTC Order, in addition to the command to cease and desist from committing or causing any violations of Section 17(a)(3) of the 1933 Act, Section 4o(1)(B) of the CEA, and CFTC Regulation 4.14(a)(2), civil monetary penalties totaling two million five hundred thousand dollars ($2,500,000) in the aggregate were required to be paid to the SEC and CFTC, of which one million two hundred fifty thousand dollars ($1,250,000) was paid by USCF to each of the SEC and the CFTC, respectively, pursuant to the offsets permitted under the orders. In re: United States Oil Fund, LP Securities Litigation On June 19, 2020, USCF, USO, John P. Love, and Stuart P. Crumbaugh were named as defendants in a putative class action filed by purported shareholder Robert Lucas (the "Lucas Class Action"). The Court thereafter consolidated the Lucas Class Action with two related putative class actions filed on July 31, 2020 and August 13, 2020, and appointed a lead plaintiff. The consolidated class action is pending in the U.S. District Court for the Southern District of New York under the caption In re: United States Oil Fund, LP Securities Litigation, Civil Action No. 1:20-cv-04740. On November 30, 2020, the lead plaintiff filed an amended complaint (the "Amended Lucas Class Complaint"). The Amended Lucas Class Complaint asserts claims under the 1933 Act, the 1934 Act, and Rule 10b-5. The Amended Lucas Class Complaint challenges statements in registration statements that became effective on February 25, 2020 and March 23, 2020 as well as subsequent public statements through April 2020 concerning certain extraordinary market conditions and the attendant risks that caused the demand for oil to fall precipitously, including the COVID-19 global pandemic and the Saudi Arabia-Russia oil price war. The Amended Lucas Class Complaint purports to have been brought by an investor in USO on behalf of a class of similarly-situated shareholders who purchased USO securities between February 25, 2020 and April 28, 2020 and pursuant to the challenged registration statements. The Amended Lucas Class Complaint seeks to certify a class and to award the class compensatory damages at an amount to be determined at trial as well as costs and attorney s fees. The Amended Lucas Class Complaint named as defendants USCF, USO, John P. Love, Stuart P. Crumbaugh, Nicholas D. Gerber, Andrew F Ngim, Robert L. Nguyen, Peter M. Robinson, Gordon L. Ellis, and Malcolm R. Fobes III, as well as the marketing agent, ALPS Distributors, Inc., and the Authorized Participants: ABN Amro, BNP Paribas Securities Corporation, Citadel Securities LLC, Citigroup Global Markets, Inc., Credit Suisse Securities USA LLC, Deutsche Bank Securities Inc., Goldman Sachs & Company, J.P. Morgan Securities Inc., Merrill Lynch Professional Clearing Corporation, Morgan Stanley & Company Inc., Nomura Securities International Inc., RBC Capital Markets LLC, SG Americas Securities LLC, UBS Securities LLC, and Virtu Financial BD LLC. The lead plaintiff has filed a notice of voluntary dismissal of its claims against BNP Paribas Securities Corporation, Citadel Securities LLC, Citigroup Global Markets Inc., Credit Suisse Securities USA LLC, Deutsche Bank Securities Inc., Morgan Stanley & Company, Inc., Nomura Securities International, Inc., RBC Capital Markets, LLC, SG Americas Securities LLC, and UBS Securities LLC. USCF, USO, and the individual defendants in In re: United States Oil Fund, LP Securities Litigation intend to vigorously contest such claims and have moved for their dismissal. Wang Class Action On July 10, 2020, purported shareholder Momo Wang filed a putative class action complaint, individually and on behalf of others similarly situated, against defendants USO, USCF, John P. Love, Stuart P. Crumbaugh, Nicholas D. Gerber, Andrew F Ngim, Robert L. Nguyen, Peter M. Robinson, Gordon L. Ellis, Malcolm R. Fobes, III, ABN Amro, BNP Paribas Securities Corp., Citadel Securities LLC, Citigroup Global Markets Inc., Credit Suisse Securities USA LLC, Deutsche Bank Securities Inc., Goldman Sachs & Company, JP Morgan Securities Inc., Merrill Lynch Professional Clearing Corp., Morgan Stanley & Company Inc., Nomura Securities International Inc., RBC Capital Markets LLC, SG Americas Securities LLC, UBS Securities LLC, and Virtu Financial BD LLC, in the U.S. District Court for the Northern District of California as Civil Action No. 3:20-cv-4596 (the "Wang Class Action"). The Wang Class Action asserted federal securities claims under the 1933 Act, challenging disclosures in a March 19, 2020 registration statement. It alleged that the defendants failed to disclose to investors in USO certain extraordinary market conditions and the attendant risks that caused the demand for oil to fall precipitously, including the COVID-19 global pandemic and the Saudi Arabia-Russia oil price war. The Wang Class Action was voluntarily dismissed on August 4, 2020. Mehan Action On August 10, 2020, purported shareholder Darshan Mehan filed a derivative action on behalf of nominal defendant USO, against defendants USCF, John P. Love, Stuart P. Crumbaugh, Nicholas D. Gerber, Andrew F Ngim, Robert L. Nguyen, Peter M. Robinson, Gordon L. Ellis, and Malcolm R. Fobes, III (the "Mehan Action"). The action is pending in the Superior Court of the State of California for the County of Alameda as Case No. RG20070732. The Mehan Action alleges that the defendants breached their fiduciary duties to USO and failed to act in good faith in connection with a March 19, 2020 registration statement and offering and disclosures regarding certain extraordinary market conditions that caused demand for oil to fall precipitously, including the COVID-19 global pandemic and the Saudi Arabia-Russia oil price war. The complaint seeks, on behalf of USO, compensatory damages, restitution, equitable relief, attorney s fees, and costs. All proceedings in the Mehan Action are stayed pending disposition of the motion(s) to dismiss in In re: United States Oil Fund, LP Securities Litigation. USCF, USO, and the other defendants intend to vigorously contest such claims. In re United States Oil Fund, LP Derivative Litigation On August 27, 2020, purported shareholders Michael Cantrell and AML Pharm. Inc. DBA Golden International filed two separate derivative actions on behalf of nominal defendant USO, against defendants USCF, John P. Love, Stuart P. Crumbaugh, Andrew F Ngim, Gordon L. Ellis, Malcolm R. Fobes, III, Nicholas D. Gerber, Robert L. Nguyen, and Peter M. Robinson in the U.S. District Court for the Southern District of New York at Civil Action No. 1:20-cv-06974 (the "Cantrell Action") and Civil Action No. 1:20-cv-06981 (the "AML Action"), respectively. The complaints in the Cantrell and AML Actions are nearly identical. They each allege violations of Sections 10(b), 20(a) and 21D of the 1934 Act, Rule 10b-5 thereunder, and common law claims of breach of fiduciary duties, unjust enrichment, abuse of control, gross mismanagement, and waste of corporate assets. These allegations stem from USO s disclosures and defendants alleged actions in light of the extraordinary market conditions in 2020 that caused demand for oil to fall precipitously, including the COVID-19 global pandemic and the Saudi Arabia-Russia oil price war. The complaints seek, on behalf of USO, compensatory damages, restitution, equitable relief, attorney s fees, and costs. The plaintiffs in the Cantrell and AML Actions have marked their actions as related to the Lucas Class Action. The Court consolidated the Cantrell and AML Actions under the caption In re United States Oil Fund, LP Derivative Litigation, Civil Action No. 1:20-cv-06974 and appointed co-lead counsel. All proceedings in In re United States Oil Fund, LP Derivative Litigation are stayed pending disposition of the motion(s) to dismiss in In re: United States Oil Fund, LP Securities Litigation. USCF, USO, and the other defendants intend to vigorously contest the claims in In re United States Oil Fund, LP Derivative Litigation. Legal Opinion Eversheds Sutherland (US) LLP is counsel to and advises UNL and USCF with respect to the shares being offered hereby and has passed upon the validity of the shares being issued hereunder. Eversheds Sutherland (US) LLP has also provided USCF with its opinion with respect to federal income tax matters addressed herein. Experts Spicer Jeffries LLP, an independent registered public accounting firm, has audited the statements of financial condition of UNL as of December 31, 2021 and December 31, 2020, including the schedule of investments as of December 31, 2021 and 2020, and the related statements of operations, changes in partners capital and cash flows for the years ended December 31, 2021, 2020 and 2019, that appear in the annual report on Form 10-K that is incorporated by reference. The financial statements of UNL in the Form 10-K were included herein in reliance upon the report of Spicer Jeffries LLP dated March 4, 2022, given on its authority of such firm as experts in accounting and auditing. Material U.S. Federal Income Tax Considerations The following discussion summarizes the material U.S. federal income tax consequences of the purchase, ownership and disposition of shares in UNL, and the U.S. federal income tax treatment of UNL, as of the date hereof. Except where noted otherwise, it deals only with shares held by beneficial owners as capital assets and does not deal with special situations, such as those of dealers in securities or currencies, financial institutions, tax-exempt entities, insurance companies, persons holding shares as a part of a position in a "straddle" or as part of a "hedging," "conversion" or other integrated transaction for U.S. federal income tax purposes, traders in securities or commodities that elect to use a mark-to-market method of accounting, or holders of shares whose "functional currency" is not the U.S. dollar. Furthermore, the discussion below is based upon the provisions of the Code and Treasury Regulations, rulings and judicial decisions thereunder as of the date hereof, and such authorities may be repealed, revoked or modified so as to result in U.S. federal income tax consequences different from those discussed below. Investors considering the purchase, ownership or disposition of shares should consult their own tax advisors concerning the U.S. federal income tax consequences in light of their particular situations as well as any consequences arising under the laws of any other taxing jurisdiction. As used herein, a "U.S. shareholder" of a share means a beneficial owner of a share that is a U.S. person. A "U.S. person," for U.S. federal income tax purposes, is (i) an individual citizen or resident of the United States, (ii) a corporation or partnership (including an entity or arrangement treated as a partnership for U.S. federal income tax purposes) created or organized in or under the laws of the United States or any political subdivision thereof (including the District of Columbia), (iii) an estate the income of which is subject to U.S. federal income taxation regardless of its source or (iv) a trust (x) that is subject to the supervision of a court within the United States and the control of one or more United States persons as described in section 7701(a)(30) of the Code or (y) that has a valid election in effect under applicable Treasury Regulations to be treated as a United States person. A "non-U.S. shareholder" is a holder that is not a U.S. shareholder. If a partnership holds our shares, the tax treatment of a partner will generally depend upon the status of the partner and the activities of the partnership. A partnership, or a partner of a partnership, holding our shares should consult his, her or its own tax advisor regarding the tax consequences of investing in our shares. USCF on behalf of UNL, has received the opinion of Eversheds Sutherland (US) LLP, counsel to UNL, that the material U.S. federal income tax consequences to UNL and to U.S. shareholders and non-U.S. shareholders will be as described below. In rendering its opinion, Eversheds Sutherland (US) LLP has relied on the facts described in this Registration Statement as well as certain factual representations made by UNL and USCF. The opinion of Eversheds Sutherland (US) LLP is not binding on the IRS, and as a result, the IRS may not agree with the tax positions taken by UNL. If challenged by the IRS, UNL s tax positions might not be sustained by the courts. No ruling has been requested from the IRS with respect to any matter affecting UNL or prospective investors. INVESTORS CONSIDERING THE PURCHASE OF SHARES SHOULD CONSULT WITH THEIR OWN TAX ADVISORS REGARDING THE APPLICATION OF U.S. FEDERAL INCOME TAX LAWS TO THEIR PARTICULAR SITUATIONS AND THE CONSEQUENCES OF U.S. FEDERAL ESTATE OR GIFT TAX LAWS, STATE, LOCAL AND FOREIGN LAWS, AND TAX TREATIES. Tax Status of UNL UNL is organized and operated as a limited partnership in accordance with the provisions of the LP Agreement and applicable state law. Under the Code, an entity or arrangement treated as a partnership that is deemed to be a "publicly traded partnership" is generally taxable as a corporation for U.S. federal income tax purposes. The Code provides an exception to this general rule for a publicly traded partnership whose gross income for each taxable year of its existence consists of at least 90% "qualifying income" (the "qualifying income exception"). For this purpose, section 7704 defines "qualifying income" as including, in pertinent part, interest (other than from a financial business), dividends and gains from the sale or disposition of capital assets held for the production of interest or dividends. In addition, in the case of a partnership a principal activity of which is the buying and selling of commodities (other than as inventory) or of futures, forwards and options with respect to commodities, "qualifying income" includes income and gain from such commodities and futures, forwards and options with respect to commodities. UNL and USCF have represented the following to Eversheds Sutherland (US) LLP: At least 90% of UNL s gross income for each taxable year will constitute "qualifying income" within the meaning of Code section 7704 (as described above); UNL is organized and operated in accordance with its governing agreements and applicable law; UNL has not elected, and will not elect, to be classified as a corporation for U.S. federal income tax purposes. Based in part on these representations, Eversheds Sutherland (US) LLP is of the opinion that UNL will be classified as a partnership for U.S. federal income tax purposes and that it is not taxable as a corporation for such purposes. UNL s taxation as a partnership rather than a corporation will require USCF to conduct UNL s business activities in such a manner that it satisfies the qualifying income exception on a continuing basis. No assurance can be given that UNL s operations for any given year will produce income that satisfies the requirements of the qualifying income exception. Eversheds Sutherland (US) LLP will not review UNL s ongoing compliance with these requirements and will have no obligation to advise UNL or UNL s shareholders in the event of any subsequent change in the facts, representations or applicable law relied upon in reaching its opinion. If UNL failed to satisfy the qualifying income exception in any year, other than a failure that is determined by the IRS to be inadvertent and that is cured within a reasonable time after discovery, UNL would be taxable as a corporation for U.S. federal income tax purposes and would be obligated to pay U.S. federal income tax on its income at regular corporate rates. In that event, shareholders would not report their share of UNL s income or loss on their returns. In addition, distributions to shareholders would be treated as dividends to the extent of UNL s current and accumulated earnings and profits. Subject to holding period and other requirements, any such dividend would be a qualifying dividend subject to U.S. federal income tax at the lower maximum tax rates applicable to long-term capital gains. To the extent a distribution exceeded UNL s earnings and profits, the distribution would be treated as a return of capital to the extent of a shareholder s basis in its shares, and thereafter as gain from the sale of shares. Accordingly, if UNL were to be taxable as a corporation, it would likely have a material adverse effect on the economic return from an investment in UNL and on the value of the shares. The remainder of this summary assumes that UNL is classified as a partnership for U.S. federal income tax purposes and not taxable as a corporation. U.S. Shareholders Tax Consequences of Ownership of Shares Taxation of UNL s Income. No U.S. federal income tax is paid by UNL on its income. Instead, UNL files annual information returns, and each U.S. shareholder is required to report on its U.S. federal income tax return its allocable share of the income, gain, loss, deduction and credit of UNL. For example, shareholders must take into account their share of ordinary income realized by UNL from accruals of interest on Treasuries and other investments, and their share of gain from Natural Gas Interests. These items must be reported without regard to the amount (if any) of cash or property the shareholder receives as a distribution from UNL during the taxable year. Consequently, a shareholder may be allocated income or gain by UNL but receive no cash distribution with which to pay its tax liability resulting from the allocation, or may receive a distribution that is insufficient to pay such liability. Because USCF currently does not intend to make distributions, it is likely that in any year UNL realizes net income and/or gain that a U.S. shareholder will be required to pay taxes on its allocable share of such income or gain from sources other than UNL distributions. In addition, individuals with income in excess of $200,000 ($250,000 in the case of married individuals filing jointly) and certain estates and trusts are subject to an additional 3.8% tax on their "net investment income," which generally includes net income from interest, dividends, annuities, royalties, and rents, and net capital gains (other than certain amounts earned from trades or businesses). The income subject to the additional 3.8% tax includes any income from businesses involved in the trading of financial instruments or commodities. Allocations of UNL s Profit and Loss. Under Code section 704, the determination of a partner s distributive share of any item of income, gain, loss, deduction or credit is governed by the applicable organizational document unless the allocation provided by such document lacks "substantial economic effect." An allocation that lacks substantial economic effect nonetheless will be respected if it is in accordance with the partners interests in the partnership, determined by taking into account all facts and circumstances relating to the economic arrangements among the partners. Subject to the discussion below, concerning certain conventions to be used by UNL, allocations of UNL income pursuant to the LP Agreement should be considered as having substantial economic effect or as being in accordance with a shareholder s interest in UNL. In general, UNL applies a monthly closing-of-the-books convention in determining allocations of economic profit or loss to shareholders. Income, gain, loss and deduction are determined on a monthly "mark-to-market" basis, taking into account accrued income and deductions and realized and unrealized gains and losses for the month. Items of taxable income, deduction, gain, loss and credit recognized by UNL for U.S. federal income tax purposes for any taxable year are allocated among holders in a manner that equitably reflects the allocation of economic profit or loss. Under the monthly allocation convention used by UNL, the investor who holds a share as of the close of business on the last trading day of the previous month will be treated for purposes of making allocations as if it owned the share throughout the current month even if such investor disposes of such share during the current month. For example, an investor who buys a share on April 10 of a year and sells it on May 20 of the same year will be allocated all of the tax items attributable to May (because he is deemed to hold it through the last day of May) but will not be allocated any of the tax items attributable to April. The tax items attributable to that share for April will be allocated to the person who is the actual or deemed holder of the share as of the close of business on the last trading day of March. Under the monthly convention, an investor who purchases and sells a share during the same month, and therefore does not hold (and is not deemed to hold) the share at the close of business on the last trading day of either that month or the previous month, will receive no allocations with respect to that share for any period. Accordingly, investors may receive no allocations with respect to shares that they actually held, or may receive allocations with respect to shares attributable to periods that they did not actually hold the shares. By investing in shares, a U.S. Shareholder agrees that, in the absence of new legislation, regulatory or administrative guidance, or judicial rulings to the contrary, it will file its U.S. federal income tax returns in a manner that is consistent with the monthly allocation convention as described above and with the IRS Schedule K-1 or any successor form provided to shareholders by UNL. UNL applies certain conventions in determining and allocating items for tax purposes in order to reduce the complexity and costs of administration. USCF believes that application of these conventions is consistent with the intent of the partnership provisions of the Code and the applicable Treasury Regulations, and that the resulting allocations will have substantial economic effect or otherwise should be respected as being in accordance with shareholders interests in UNL for U.S. federal income tax purposes. The Code and existing Treasury Regulations do not expressly permit adoption of these conventions although the monthly allocation convention described above is consistent with methods permitted under the applicable Treasury Regulations, as well as the legislative history for the provisions that require allocations to appropriately reflect changes in ownership interests. It is possible that the IRS could successfully challenge UNL s allocations methods on the ground that they do not satisfy the technical requirements off the Code or Treasury Regulations, requiring a shareholder to report a greater or lesser share of items of income, gain, loss, deduction, or credit than if our method were respected. USCF is authorized to revise our allocation method to conform to any method permitted under future Treasury Regulations. The assumptions and conventions used in making tax allocations may cause a shareholder to be allocated more or less income or loss for U.S. federal income tax purposes than its proportionate share of the economic income or loss realized by UNL during the period it held its shares. This "mismatch" between taxable and economic income or loss in some cases may be temporary, reversing itself in a later period when the shares are sold, but could be permanent. Section 754 Election. UNL has made the election permitted by section 754 of the Code, which election is irrevocable without the consent of the Service. The effect of this election is that, in connection with secondary market sales, we adjust the purchaser s proportionate share of the tax basis of our assets to fair market value, as reflected in the price paid for the shares, as if the purchaser had directly acquired an interest in our assets. The section 754 election is intended to eliminate disparities between a partner s basis in its partnership interest and its share of the tax bases of the partnership s assets, so that the partner s allocable share of taxable gain or loss on a disposition of an asset will correspond to its share of the appreciation or depreciation in the value of the asset since it acquired its interest. Depending on the price paid for shares and the tax bases of UNL s assets at the time of the purchase, the effect of the section 754 election on a purchaser of shares may be favorable or unfavorable. In order to make the appropriate basis adjustments in a cost-effective manner, UNL will use certain simplifying conventions and assumptions. It is possible the IRS will successfully assert that the conventions and assumptions applied are improper and require different basis adjustments to be made, which could adversely affect some shareholders. Mark to Market of Certain Exchange-Traded Contracts. For U.S. federal income tax purposes, UNL generally is required to use a "mark-to-market" method of accounting under which unrealized gains and losses on instruments constituting "section 1256 contracts" are recognized currently. A section 1256 contract is defined as: (1) a futures contract that is traded on or subject to the rules of a national securities exchange which is registered with the SEC, a domestic board of trade designated as a contract market by the CFTC, or any other board of trade or exchange designated by the Secretary of the Treasury, and with respect to which the amount required to be deposited and the amount that may be withdrawn depends on a system of "marking to market"; (2) a forward contract on exchange-traded foreign currencies, where the contracts are traded in the interbank market; (3) a non-equity option traded on or subject to the rules of a qualified board or exchange; (4) a dealer equity option; or (5) a dealer securities futures contract. Under these rules, section 1256 contracts held by UNL at the end of each taxable year, including for example Futures Contracts and options on Futures Contracts traded on a U.S. exchange or board of trade or certain foreign exchanges, are treated as if they were sold by UNL for their fair market value on the last business day of the taxable year. A shareholder s distributive share of UNL s net gain or loss with respect to each section 1256 contract generally is treated as long-term capital gain or loss to the extent of 60 percent thereof, and as short-term capital gain or loss to the extent of 40 percent thereof, without regard to the actual holding period ("60-40 treatment"). Many of UNL s Futures Contracts and some of their other commodity interests will qualify as "section 1256 contracts" under the Code. Gain or loss recognized through disposition, termination or marking-to-market of UNL s section 1256 contracts will be subject to 60-40 treatment and allocated to shareholders in accordance with the monthly allocation convention. Cleared swaps and other commodity swaps will most likely not qualify as section 1256 contracts. If a commodity swap is not treated as a section 1256 contract, any gain or loss on the swap recognized at the time of disposition or termination will be long-term or short-term capital gain or loss depending on the holding period of the swap. Limitations on Deductibility of Losses and Certain Expenses. A number of different provisions of the Code may defer or disallow the deduction of losses or expenses allocated to you by UNL, including but not limited to those described below. A shareholder s deduction of its allocable share of any loss of UNL is limited to the lesser of (1) the tax basis in its shares or (2) in the case of a shareholder that is an individual or a closely held corporation, the amount which the shareholder is considered to have "at risk" with respect to our activities. In general, the amount at risk will be your invested capital plus your share of any recourse debt of UNL for which you are liable. Losses in excess of the lesser of tax basis or the amount at risk must be deferred until years in which UNL generates additional taxable income against which to offset such carryover losses or until additional capital is placed at risk. Noncorporate taxpayers are permitted to deduct capital losses only to the extent of their capital gains for the taxable year plus $3,000 of other income. Unused capital losses can be carried forward and used to offset capital gains in future years. In addition, a noncorporate taxpayer may elect to carry back net losses on section 1256 contracts to each of the three preceding years and use them to offset section 1256 contract gains in those years, subject to certain limitations. Corporate taxpayers generally may deduct capital losses only to the extent of capital gains, subject to special carryback and carryforward rules. For taxable years beginning before January 1, 2026, otherwise deductible expenses incurred by noncorporate taxpayers constituting "miscellaneous itemized deductions," generally including investment-related expenses (other than interest and certain other specified expenses), are not deductible. For taxable years beginning on or after January 1, 2026, such miscellaneous itemized deductions are deductible only to the extent they exceed 2 percent of the taxpayer s adjusted gross income for the year. Although the matter is not free from doubt, we believe management fees we pay to USCF and other expenses we incur will constitute investment-related expenses subject to the miscellaneous itemized deduction limitation, rather than expenses incurred in connection with a trade or business, and will report these expenses consistent with that interpretation. In addition, for taxable years beginning on or after January 1, 2026, the Code imposes additional limitations on the amount of certain itemized deductions allowable to individuals with adjusted gross income in excess of certain amounts by reducing the otherwise allowable portion of such deductions by an amount equal to the lesser of: 3% of the individual s adjusted gross income in excess of certain threshold amounts; or 80% of the amount of certain itemized deductions otherwise allowable for the taxable year. For taxable years beginning before January 1, 2026, noncorporate shareholders are entitled to a deduction (subject to certain limitations) equal to their "combined qualified business income." "Combined qualified business income" for this purpose includes 20% of a noncorporate taxpayer s "qualified publicly traded partnership income." In general, "qualified publicly traded partnership income" includes a noncorporate taxpayer s allocable share of "qualified items" of income, gain, deduction, and loss. A "qualified item" for this purpose is an item of income, gain deduction, or loss that is effectively connected with a U.S. trade or business and includible income for the year. As discussed below, although the matter is not free from doubt, UNL believes that the activities directly conducted by UNL will not result in UNL being engaged in a trade or business within in the United States. See "Non-U.S. Shareholders—Withholding on Allocations and Distributions" below. As a result, we do not anticipate that any of our items of income, gain, deduction, or loss will be reported as "qualified publicly traded partnership income" eligible for the deduction for "combined qualified business income." "Qualified publicly traded partnership income" also includes any gain or loss from the sale of an interest in a partnership to extent attributable to "unrealized receivables" or "inventory" under section 751. (For a discussion of section 751, see "Tax Consequences of Disposition of Shares" below.) A noncorporate taxpayer that recognizes any gain or loss from the sale of an interest in UNL that is attributable to "unrealized receivables" or "inventory" under section 751 should consult with such taxpayer s tax advisor to determine whether any portion of such gain or loss constitutes "qualified publicly traded partnership income" eligible for the deduction for "combined qualified business income." A taxpayer is generally prohibited from deducting business interest to the extent that it exceeds the sum of (i) business interest income of such taxpayer, (ii) 30% of the adjusted taxable income of such taxpayer, plus (iii) the floor plan financing interest of such taxpayer. In the case of partnerships, this determination is made at the partnership level. To the extent that the business income of the partnership exceeds the amount necessary to absorb all of the partnership s business interest, such excess amount is allocated to the partners as excess business income, which amount may be used against any business interest of the partner (but not any other partnerships). To the extent that the partnership has any disallowed business interest expense, such amount is allocated among the partners, reduces the partners outside basis in their partnership interests by their allocable shares, and is carried forward to future years. Such carry forward may only be used as a deduction to the extent that the partnership has excess business income in the future. In the event that a partner transfers a partnership interest with any excess business interest carry forward amounts, such amounts increase the partner s basis in its partnership interest immediately before the transfer. Although it is not free from doubt, UNL does not anticipate that it will be treated as engaged in a trade or business. As a result, UNL does not anticipate that any portion of its interest expense (if any) will constitute business interest or that shareholders will be allocated any excess business income as a result of holding UNL shares. Noncorporate shareholders generally may deduct "investment interest expense" only to the extent of their "net investment income." Investment interest expense of a shareholder will generally include any interest accrued by UNL and any interest paid or accrued on direct borrowings by a shareholder to purchase or carry its shares, such as interest with respect to a margin account. Net investment income generally includes gross income from property held for investment (including "portfolio income" under the passive loss rules but not, absent an election, long-term capital gains or certain qualifying dividend income) less deductible expenses other than interest directly connected with the production of investment income. To the extent that we allocate losses or expenses to you that must be deferred or are disallowed as a result of these or other limitations in the Code, you may be taxed on income in excess of your economic income or distributions (if any) on your shares. As one example, you could be allocated and required to pay tax on your share of interest income accrued by UNL for a particular taxable year, and in the same year be allocated a share of a capital loss that you cannot deduct currently because you have insufficient capital gains against which to offset the loss. As another example, you could be allocated and required to pay tax on your share of interest income and capital gain for a year, but be unable to deduct some or all of your share of management fees and/or margin account interest incurred by you with respect to your shares. Shareholders are urged to consult their own professional tax advisors regarding the effect of limitations under the Code on your ability to deduct your allocable share of UNL s losses and expenses. Tax Basis of Shares A shareholder s tax basis in its shares is important in determining (1) the amount of taxable gain or loss it will realize on the sale or other disposition of its shares, (2) the amount of non-taxable distributions that it may receive from UNL and (3) its ability to utilize its distributive share of any losses of UNL on its tax return. A shareholder s initial tax basis of its shares will equal its cost for the shares plus its share of UNL s liabilities (if any) at the time of purchase. In general, a shareholder s "share" of those liabilities will equal the sum of (i) the entire amount of any otherwise nonrecourse liability of UNL as to which the shareholder or an affiliate is the creditor (a "partner nonrecourse liability") and (ii) a pro rata share of any nonrecourse liabilities of UNL that are not partner nonrecourse liabilities as to any shareholder. A shareholder s tax basis in its shares generally will be (1) increased by (a) its allocable share of UNL s taxable income and gain and (b) any additional contributions by the shareholder to UNL and (2) decreased (but not below zero) by (a) its allocable share of UNL s tax deductions and losses and (b) any distributions by UNL to the shareholder. For this purpose, an increase in a shareholder s share of UNL s liabilities will be treated as a contribution of cash by the shareholder to UNL and a decrease in that share will be treated as a distribution of cash by UNL to the shareholder. Pursuant to certain IRS rulings, a shareholder will be required to maintain a single, "unified" basis in all shares that it owns. As a result, when a shareholder that acquired its shares at different prices sells less than all of its shares, such shareholder will not be entitled to specify particular shares (e.g., those with a higher basis) as having been sold. Rather, it must determine its gain or loss on the sale by using an "equitable apportionment" method to allocate a portion of its unified basis in its shares to the shares sold. Treatment of UNL Distributions. If UNL makes non-liquidating distributions to shareholders, such distributions generally will not be taxable to the shareholders for U.S. federal income tax purposes except to the extent that the sum of (i) the amount of cash and (ii) the fair market value of marketable securities distributed exceeds the shareholder s adjusted basis of its interest in UNL immediately before the distribution. Any cash distributions in excess of a shareholder s tax basis generally will be treated as gain from the sale or exchange of shares. Tax Consequences of Disposition of Shares If a shareholder sells its shares, it will recognize gain or loss equal to the difference between the amount realized and its adjusted tax basis in the shares sold. A shareholder s amount realized will be the sum of the cash or the fair market value of other property received plus its share of any UNL debt outstanding. Gain or loss recognized by a shareholder on the sale or exchange of shares held for more than one year will generally be taxable as long-term capital gain or loss; otherwise, such gain or loss will generally be taxable as short-term capital gain or loss. A special election is available under the Treasury Regulations that will allow shareholders to identify and use the actual holding periods for the shares sold for purposes of determining whether the gain or loss recognized on a sale of shares will give rise to long-term or short-term capital gain or loss. It is expected that most shareholders will be eligible to elect, and generally will elect, to identify and use the actual holding period for shares sold. If a shareholder fails to make the election or is not able to identify the holding periods of the shares sold, the shareholder may have a split holding period in the shares sold. Under such circumstances, a shareholder will be required to determine its holding period in the shares sold by first determining the portion of its entire interest in UNL that would give rise to long-term capital gain or loss if its entire interest were sold and the portion that would give rise to short-term capital gain or loss if the entire interest were sold. The shareholder would then treat each share sold as giving rise to long-term capital gain or loss and short-term capital gain or loss in the same proportions as if it had sold its entire interest in UNL. Under Section 751 of the Code, a portion of a shareholder s gain or loss from the sale of shares (regardless of the holding period for such shares), will be separately computed and taxed as ordinary income or loss to the extent attributable to "unrealized receivables" or "inventory" owned by UNL. The term "unrealized receivables" includes, among other things, market discount bonds and short-term debt instruments to the extent such items would give rise to ordinary income if sold by UNL. However, the short-term capital gain on section 1256 contracts resulting from 60-40 treatment, described above, should not be subject to this rule. If some or all of your shares are lent by your broker or other agent to a third party — for example, for use by the third party in covering a short sale — you may be considered as having made a taxable disposition of the loaned shares. Shareholders desiring to avoid these and other possible consequences of a deemed disposition of their shares are urged to seek advice from their tax advisors. Other Tax Matters Information Reporting. UNL reports tax information to the beneficial owners of shares. The IRS has ruled that assignees of partnership interests who have not been admitted to a partnership as partners but who have the capacity to exercise substantial dominion and control over the assigned partnership interests will be considered beneficial owners for U.S. federal income tax purposes. On the basis of such ruling, except as otherwise provided herein, we treat the following persons as partners for U.S. federal income tax purposes: (1) assignees of shares who are pending admission as limited partners, and (2) shareholders whose shares are held in street name or by another nominee and who have the right to direct the nominee in the exercise of all substantive rights attendant to the ownership of their shares. UNL will furnish shareholders each year with tax information on IRS Schedule K-1 (Form 1065), which will be used by the shareholders in completing their tax returns. Persons who hold an interest in UNL as a nominee for another person are required to furnish to us the following information: (1) the name, address and taxpayer identification number of the beneficial owner and the nominee; (2) whether the beneficial owner is (a) a person that is not a U.S. person, (b) a foreign government, an international organization or any wholly-owned agency or instrumentality of either of the foregoing, or (c) a tax-exempt entity; (3) the amount and description of shares acquired or transferred for the beneficial owner; and (4) certain information including the dates of acquisitions and transfers, means of acquisitions and transfers, and acquisition cost for purchases, as well as the amount of net proceeds from sales. Brokers and financial institutions are required to furnish additional information, including whether they are U.S. persons and certain information on shares they acquire, hold or transfer for their own account. The nominee is required to supply the beneficial owner of the shares with the information furnished to us. Penalties may apply for failure to report required information. Partnership Audit Procedures. The IRS may audit the U.S. federal income tax returns filed by UNL. Partnerships are generally treated as separate entities for purposes of U.S. federal income tax audits, judicial review of administrative adjustments by the IRS, and tax settlement proceedings. The tax treatment of partnership items of income, gain, loss and deduction are determined at the partnership level in a unified partnership proceeding rather than in separate proceedings with the shareholders. UNL may be liable for U.S. federal income tax on any "imputed understatement" resulting from an adjustment due to an IRS audit. The amount of the imputed understatement generally includes increases in allocations of items of income or gains to any investor and decreases in allocations of items of deduction, loss, or credit to any shareholder without any offset for any corresponding reductions in allocations of items of income or gain to any investor or increases in allocations of items of deduction, loss, or credit to any investor. If UNL is required to pay additional U.S. federal income tax arising from an imputed understatement, the resulting tax liability would reduce the net assets of UNL and would likely have an adverse impact on the value of the shares. Under certain circumstances, UNL may be eligible to make an election to cause the investors to take into account the amount of any imputed understatement, including any interest and penalties. The ability of a publicly traded partnership such as UNL to make this election is uncertain. If the election is made, UNL would be required to provide investors who owned beneficial interests in the shares in the year to which the adjusted allocations relate with a statement setting forth their proportionate shares of the adjustment ("Adjusted K-1s"). The investors would be required to take the adjustment into account in the taxable year in which the Adjusted K-1s are issued. The Code generally requires UNL to designate one person as the "partnership representative" who has sole authority to defend against an audit with the IRS, challenge any adjustment in a court of law, and settle any audit or other proceeding. The LP Agreement appoints USCF as the partnership representative of UNL. Tax Shelter Disclosure Rules. In certain circumstances the Code and Treasury Regulations require that the IRS be notified of taxable transactions through a disclosure statement attached to a taxpayer s U.S. federal income tax return. These disclosure rules may apply to transactions irrespective of whether they are structured to achieve particular tax benefits. They could require disclosure by UNL or shareholders if a shareholder incurs a loss in excess a specified threshold from a sale or redemption of its shares or possibly in other circumstances. While these rules generally do not require disclosure of a loss recognized on the disposition of an asset in which the taxpayer has a "qualifying basis" (generally a basis equal to the amount of cash paid by the taxpayer for such asset), they apply to a loss recognized with respect to interests in a pass-through entity, such as the shares, even if the taxpayer s basis in such interests is equal to the amount of cash it paid. In addition, under recently enacted legislation, significant penalties may be imposed in connection with a failure to comply with these reporting requirements. Investors should consult their own tax advisors concerning the application of these reporting requirements to their specific situation. Regulated Investment Companies. Interests in and income from "qualified publicly traded partnerships" satisfying certain gross income tests are treated as qualifying assets and income, respectively, for purposes of determining eligibility for regulated investment company ("RIC") status. A RIC may invest up to 25% of its assets in interests in a qualified publicly traded partnership. The determination of whether a publicly traded partnership such as UNL is a qualified publicly traded partnership is made on an annual basis. UNL expects to be a qualified publicly traded partnership in each of its taxable years. However, such qualification is not assured. Non-U.S. Shareholders Generally, non-U.S. persons who derive U.S. source income or gain from investing or engaging in a U.S. business are taxable on two categories of income. The first category consists of amounts that are fixed, determinable, annual and periodic income, such as interest, dividends and rent that are not connected with the operation of a U.S. trade or business ("FDAP"). The second category is income that is effectively connected with the conduct of a U.S. trade or business ("ECI"). FDAP income (other than interest that is considered "portfolio interest") is generally subject to a 30-percent withholding tax, which may be reduced for certain categories of income by a treaty between the United States and the recipient s country of residence. In contrast, ECI is generally subject to U.S. tax on a net basis at graduated rates upon the filing of a U.S. tax return. Withholding on Allocations and Distributions. The Code provides that a non-U.S. person who is a partner in a partnership that is engaged in the conduct of a U.S. trade or business during a taxable year will also be considered to be engaged in the conduct of a U.S. trade or business during that year. Classifying an activity by a partnership as an investment or an operating business is a factual determination. Under certain safe harbors in the Code, an investment fund whose activities consist of trading in stocks, securities, or commodities for its own account generally will not be considered to be engaged in a U.S. trade or business unless it is a dealer in such stocks, securities, or commodities. This safe harbor applies to investments in commodities only if the commodities are of a kind customarily dealt on an organized commodity exchange and if the transaction is of a kind customarily consummated at such place. Although the matter is not free from doubt, UNL believes that the activities directly conducted by UNL will not result in UNL being engaged in the conduct of a trade or business within in the United States. However, there can be no assurance that the IRS would not successfully assert that UNL s activities constitute a U.S. trade or business. In the event that UNL s activities were considered to constitute a U.S. trade or business, UNL would be required to withhold at the highest rate specified in section 1 of the Code on allocations of income to individual and corporate non-U.S. Shareholders when such income is allocated or distributed. A non-U.S. shareholder with ECI will generally be required to file a U.S. federal income tax return, and the return will provide the non-U.S. shareholder with the mechanism to seek a refund of any withholding in excess of such shareholder s actual U.S. federal income tax liability. Any amount withheld by UNL on behalf of a non-U.S. shareholder will be treated as a distribution to the non-U.S. shareholder to the extent possible. In some cases, UNL may not be able to match the economic cost of satisfying its withholding obligations to a particular non-U.S. shareholder, which may result in such cost being borne by UNL, generally, and accordingly, by all shareholders. If UNL is not treated as engaged in a U.S. trade or business, a non-U.S. shareholder may nevertheless be treated as having FDAP income, which would be subject to a 30-percent withholding tax (possibly subject to reduction by treaty), with respect to some or all of its distributions from UNL or its allocable share of UNL income. Amounts withheld on behalf of a non-U.S. shareholder will be treated as being distributed to such shareholder. To the extent any interest income allocated to a non-U.S. shareholder that otherwise constitutes FDAP is considered "portfolio interest," neither the allocation of such interest income to the non-U.S. shareholder nor a subsequent distribution of such interest income to the non-U.S. shareholder will be subject to withholding, provided that the non-U.S. shareholder is not otherwise engaged in a trade or business in the United States and provides UNL with a timely and properly completed and executed IRS Form W-8BEN, W-8BEN-E, or other applicable form. In general, "portfolio interest" is interest paid on debt obligations issued in registered form, unless the "recipient" owns 10 percent or more of the voting power of the issuer. Most of UNL s interest income qualifies as "portfolio interest." In order for UNL to avoid withholding on any interest income allocable to non-U.S. shareholders that would qualify as "portfolio interest," it will be necessary for all non-U.S. shareholders to provide UNL with a timely and properly completed and executed Form W-8BEN or W-8BEN-E (or other applicable form). If a non-U.S. shareholder fails to provide a properly completed Form W-8BEN, W-8BEN-E, or other applicable form, USCF may request that the non-U.S. shareholder provide, within 15 days after the request by USCF, a properly completed Form W-8BEN, W-8BEN-E, or other applicable form. If a non-U.S. shareholder fails to comply with this request, the shares owned by such non-U.S. shareholder will be subject to redemption. Gain from Sale of Shares. Gain from the sale or exchange of the shares may be taxable to a non-U.S. shareholder if the non-U.S. shareholder is a nonresident alien individual who is present in the U.S. for 183 days or more during the taxable year. In such case, the nonresident alien individual will be subject to a 30 percent withholding tax on the amount of such individual s gain. In addition, if UNL is treated as being engaged in a U.S. trade or business, a portion of the gain on the sale or exchange will be treated as effectively connected income subject to U.S. federal income tax to the extent that a sale of UNL s assets would give rise to effectively connected income. Although the transferee of a partnership interest is generally required to withhold 10% of the proceeds from the sale of a partnership interest acquired from a non-U.S. partner if any portion of the gain would be treated as effectively connected income, the IRS has issued a notice in which it has indicated that such withholding requirement will not apply to transferees of publicly traded partnership interests until the IRS and Treasury issue regulations implementing such provision. However, this does not relieve a non-U.S. shareholder from U.S. income tax on any gain treated as effectively connected income. Branch Profits Tax on Corporate Non-U.S. Shareholders. In addition to the taxes noted above, any non-U.S. shareholders that are corporations may also be subject to an additional tax, the branch profits tax, at a rate of 30 percent. The branch profits tax is imposed on a non-U.S. corporation s dividend equivalent amount, which generally consists of the corporation s after-tax earnings and profits that are effectively connected with the corporation s U.S. trade or business but are not reinvested in a U.S. business. This tax may be reduced or eliminated by an income tax treaty between the United States and the country in which the non-U.S. shareholder is a "qualified resident." Prospective non-U.S. shareholders should consult their tax advisor with regard to these and other issues unique to non-U.S. shareholders. Backup Withholding UNL may be required to withhold U.S. federal income tax ("backup withholding") from all taxable distributions payable to: (1) any shareholder who fails to furnish UNL with his, her or its correct taxpayer identification number or a certificate that the shareholder is exempt from backup withholding, and (2) any shareholder with respect to whom the IRS notifies UNL that the shareholder has failed to properly report certain interest and dividend income to the IRS and to respond to notices to that effect. Backup withholding is not an additional tax and may be returned or credited against a taxpayer s regular U.S. federal income tax liability if appropriate information is provided to the IRS. Foreign Account Tax Compliance Act Provisions Legislation commonly referred to as the "Foreign Account Tax Compliance Act," or "FATCA," generally imposes a 30% withholding tax on payments of certain types of income to foreign financial institutions ("FFIs") unless such FFIs (1) enter into an agreement with the U.S. Treasury Department to report certain required information with respect to accounts held by certain specified U.S. persons (or held by foreign entities that have certain specified U.S. persons as substantial owners) or (2) reside in a jurisdiction that has entered into an intergovernmental agreement ("IGA") with the United States to collect and share such information and comply with the terms of such IGA and any enabling legislation or regulations. The types of income subject to the tax include U.S.-source interest and dividends. While the Code would also require withholding on the payments of the gross proceeds from the sale of any property that could produce U.S.-source interest or dividends, the U.S. Treasury Department has indicated in subsequent proposed Treasury Regulations its intent to eliminate this requirement. The information required to be reported includes the identity and taxpayer identification number of each account holder that is a specified U.S. person and transaction activity within the holder s account. In addition, subject to certain exceptions, this legislation also imposes a 30% withholding tax on payments to foreign entities that are not FFIs unless the foreign entity certifies that it does not have a greater than 10% U.S. owner that is a specified U.S. person or provides the withholding agent with identifying information on each greater than 10% U.S. owner that is a specified U.S. person. Depending on the status of a beneficial owner and the status of the intermediaries through which they hold their shares, beneficial owners could be subject to this 30% withholding tax with respect to distributions on their shares. Under certain circumstances, a beneficial owner might be eligible for refunds or credits of such taxes. Other Tax Considerations In addition to U.S. federal income taxes, shareholders may be subject to other taxes, such as foreign (non-U.S.) income taxes, state and local income taxes, unincorporated business taxes, business franchise taxes, gift and estate, inheritance or intangible taxes that may be imposed by the various jurisdictions in which UNL does business or owns property or where the shareholders reside. Although an analysis of those various taxes is not presented here, each prospective shareholder should consider their potential impact on its investment in UNL. It is each shareholder s responsibility to file the appropriate U.S. federal, state, local, and foreign tax returns. Eversheds Sutherland (US) LLP has not provided an opinion concerning any aspects of state, local or foreign tax or U.S. federal tax other than those U.S. federal income tax issues discussed herein. Certain ERISA and Related Considerations General Many employee benefit plans and individual retirement accounts ("IRAs") are subject to the Employee Retirement Income Security Act of 1974, as amended ("ERISA") or the Code, or both. This section discusses certain considerations that arise under ERISA and the Code that a fiduciary of: (i) an employee benefit plan as defined in ERISA; (ii) a plan as defined in Section 4975 of the Code; or (iii) any collective investment vehicle, business trust, investment partnership, pooled separate account or other entity the assets of which are treated as comprised (at least in part) of "plan assets" under the ERISA plan asset rules ("plan asset entity"); who has investment discretion should take into account before deciding to invest in the entity s assets in UNL. Employee benefit plans, plans defined under Section 4975 of the Code and plan asset entities are collectively referred to below as "plans", and fiduciaries with investment discretion are referred to below as "plan fiduciaries". This summary is based on the provisions of ERISA, the Code and applicable guidance as of the date hereof. This summary is not intended to be complete, but only to address certain questions under ERISA and the Code. The summary does not include state or local law. Potential plan investors are urged to consult with their own professional advisors concerning the appropriateness of an investment in UNL and the manner in which limited partnership interests should be purchased. USCF does not represent that the limited partnership interests hereby offered are appropriate for plans or any particular plan. Special Investment Considerations Investments by plans governed by ERISA are subject to ERISA s fiduciary requirements, including the requirements of investment prudent and diversification. As a result, each plan fiduciary must consider the facts and circumstances that are relevant to their plan s specific circumstances when evaluating an investment in UNL, including the role that an investment in UNL would play in the plan s overall investment portfolio, taking into account the plan s purpose, the risk and loss of potential return with respect to the investment, the liquidity, the current return of the total portfolio relative to the anticipated cash flow needs of the plan, and the projected return of the portfolio and relative to the plan s investment objectives. Each plan fiduciary, before deciding to invest in UNL, must be satisfied that its investment in the limited partnership interests in UNL is prudent for the plan, that the investments of the plan are properly diversified and that an investment in UNL complies with the terms of the plan. UNL and Plan Assets Regulations issued under ERISA contains rules for determining when an investment by a plan in an equity interest of a limited partnership will result in the underlying assets of the partnership being deemed "plan assets" for purposes of ERISA and Section 4975 of the Code. Those rules provide that assets of a limited partnership will not be deemed to be of a plan that purchases an equity interest in the partnership if the equity interest purchased qualifies as a publicly-offered security. If the underlying assets of a limited partnership are considered to be assets of any plan for purposes of ERISA or Section 4975 of the Code, the operations of that partnership would be subject to and, in some cases, limited by, the provisions of ERISA and Section 4975 of the Code. An equity interest will qualify as a publicly offered security if it is: 1.freely transferable (determined based on the relevant facts and circumstances); 2.part of a class of securities that is widely held (meaning that the class of securities is owned by 100 or more investors independent of the issuer and of each other); and 3.either (a) part of a class of securities registered under Section 12(b) or 12(g) of the Exchange Act or (b) sold to the plan as part of a public offering pursuant to an effective registration statement under the 1933 Act and the class of which such security is a part is registered under the Exchange Act within 120 days (or such later time as may be allowed by the SEC) after the end of the fiscal year of the issuer in which the offering of such security occurred. Regulations under ERISA state that the determination of whether a security is "freely transferable" is to be made based on all of the relevant facts and circumstances. In the case of a security that is part of an offering in which the minimum investment is $10,000 or less, the following requirements, alone or in combination, ordinarily will not affect a finding that the security is freely transferable: (1) a requirement that no transfer or assignment of the security or rights relating to the security be made that would violate any federal or state law, (2) a requirement that no transfer or assignment be made without advance written notice given to the entity that issued the security, and (3) any restriction on the substitution of an assignee as a limited partner of a partnership, including a general partner consent requirement, provided that the economic benefits of ownership of the assignor may be transferred or assigned without regard to such restriction or consent (other than compliance with any of the foregoing restrictions). USCF believes that the conditions described above are satisfied with respect to the limited partnership interests. USCF believes that the limited partnership interests therefore constitute publicly-offered securities, and the underlying assets of UNL will not be deemed to be "plan assets" under applicable ERISA regulations. Prohibited Transactions ERISA and the Code generally prohibit certain transactions involving plans and persons who have certain specified relationships to plans. In general, UNL limited partnership interests may not be purchased with the assets of a plan if USCF, the clearing brokers, the trading advisors (if any), or any of their affiliates, agents or employees: exercise any discretionary authority or discretionary control with respect to management of the plan; exercise any authority or control with respect to management or disposition of the assets of the plan; render investment advice for a fee or other compensation, direct or indirect, with respect to any monies or other property of the plan; have any authority or responsibility to render investment advice with respect to any monies or other property of the plan; or have any discretionary authority or discretionary responsibility in the administration of the plan. Also, a prohibited transaction may occur under ERISA or the Code when circumstances indicate that (1) the investment in an equity interest is made or retained for the purpose of avoiding application of the fiduciary standards of ERISA, (2) the investment in an equity interest constitutes an arrangement under which UNL is expected to engage in transactions that would otherwise be prohibited if entered into directly by the plan purchasing the share, (3) the investing plan, by itself, has the authority or influence to cause UNL to engage in such transactions, or (4) a person who is prohibited from transacting with the investing plan may, but only with the aid of certain of its affiliates and the investing plan, cause UNL to engage in such transactions with such person. Special IRA Rules Individual retirement accounts ("IRAs") are not subject to ERISA s fiduciary standards, but are subject to their own rules, including the prohibited transaction rules of Section 4975 of the Code, which generally mirror ERISA s prohibited transaction rules. For example, IRAs are subject to special custody rules and must maintain a qualifying IRA custodial arrangement separate and distinct from UNL and its custodial arrangement. Otherwise, if a separate qualifying custodial arrangement is not maintained, an investment in the limited partnership interests will be treated as a distribution from the IRA. Additionally, IRAs are prohibited from investing in certain commingled investments, and USCF makes no representation regarding whether an investment in limited partnership interests is an inappropriate commingled investment for an IRA. Finally, in applying the prohibited transaction provisions of Section 4975 of the Code, in addition to the rules summarized above, the individual for whose benefit the IRA is maintained is also treated as the creator of the IRA. For example, if the owner or beneficiary of an IRA enters into any transaction, arrangement, or agreement involving the assets of his or her IRA to benefit the IRA owner or beneficiary (or his or her relatives or business affiliates) personally, or with the understanding that such benefit will occur, directly or indirectly, such transaction could give rise to a prohibited transaction that is not exempted by any available exemption. Moreover, in the case of an IRA, the consequences of a non-exempt prohibited transaction are that the IRA s assets will be treated as if they were distributed, causing immediate taxation of the assets (including any early distribution penalty tax applicable under Section 72 of the Code), in addition to any other fines or penalties that may apply. Exempt Plans Governmental plans and church plans are generally not subject to ERISA, and the above-described prohibited transaction provisions described above do not apply to them. These plans are, however, subject to prohibitions against certain related-party transactions under Section 503 of the Code, which operate similar to the prohibited transaction rules described above. In addition, the fiduciary of any governmental or church plan should consider any applicable state or local laws and any restrictions and duties of common law imposed upon the plan. No view is expressed as to whether an investment in UNL (and any continued investment in UNL), or the operation and administration of UNL, is appropriate or permissible for any governmental plan or church plan under Code Section 503, or under any state, county, local or other law relating to that type of plan. Allowing an investment in UNL is not to be construed as a representation by USCF, any trading advisor, any clearing broker, the Marketing Agent or legal counsel or other advisors to such parties or any other party that this investment meets some or all of the relevant legal requirements with respect to investments by any particular plan or that this investment is appropriate for any such particular plan. The person with investment discretion should consult with the plan s attorney and financial advisors as to the propriety of an investment in UNL in light of the circumstances of the particular plan, current tax law and ERISA. THE FOREGOING SUMMARY OF ERISA CONSIDERATIONS IS BASED UPON ERISA, JUDICIAL DECISIONS, DEPARTMENT OF LABOR REGULATIONS AND RULINGS IN EXISTENCE ON THE DATE HEREOF, ALL OF WHICH ARE SUBJECT TO CHANGE. THE SUMMARY IS GENERAL IN NATURE AND DOES NOT ADDRESS EVERY ERISA ISSUE THAT MAY BE APPLICABLE TO AN INVESTMENT IN UNL OR TO A PARTICULAR INVESTOR. Form of Shares Registered Form. Shares are issued in registered form in accordance with the LP Agreement. The Administrator has been appointed registrar and transfer agent for the purpose of transferring shares in certificated form. The Administrator keeps a record of all limited partners and holders of the shares in certificated form in the registry (the "Register"). USCF recognizes transfers of shares in certificated form only if done in accordance with the LP Agreement. The beneficial interests in such shares are held in book-entry form through participants and/or accountholders in the Depository Trust Company ("DTC"). Book Entry. Individual certificates are not issued for the shares. Instead, shares are represented by one or more global certificates, which are deposited by the Administrator with DTC and registered in the name of Cede & Co., as nominee for DTC. The global certificates evidence all of the shares outstanding at any time. Shareholders are limited to (1) participants in DTC such as banks, brokers, dealers and trust companies ("DTC Participants"), (2) those who maintain, either directly or indirectly, a custodial relationship with a DTC Participant ("Indirect Participants"), and (3) those banks, brokers, dealers, trust companies and others who hold interests in the shares through DTC Participants or Indirect Participants, in each case who satisfy the requirements for transfers of shares. DTC Participants acting on behalf of investors holding shares through such participants accounts in DTC will follow the delivery practice applicable to securities eligible for DTC s Same-Day Funds Settlement System. Shares are credited to DTC Participants securities accounts following confirmation of receipt of payment. DTC. DTC has advised UNL as follows: It is a limited purpose trust company organized under the laws of the State of New York and is a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code and a "clearing agency" registered pursuant to the provisions of Section 17A of the Exchange Act. DTC holds securities for DTC Participants and facilitates the clearance and settlement of transactions between DTC Participants through electronic book-entry changes in accounts of DTC Participants. Transfer of Shares Transfers of Shares Only Through DTC. The shares are only transferable through the book-entry system of DTC. Limited partners who are not DTC Participants may transfer their shares through DTC by instructing the DTC Participant holding their shares (or by instructing the Indirect Participant or other entity through which their shares are held) to transfer the shares. Transfers are made in accordance with standard securities industry practice. Transfers of interests in shares with DTC are made in accordance with the usual rules and operating procedures of DTC and the nature of the transfer. DTC has established procedures to facilitate transfers among the participants and/or accountholders of DTC. Because DTC can only act on behalf of DTC Participants, who in turn act on behalf of Indirect Participants, the ability of a person or entity having an interest in a global certificate to pledge such interest to persons or entities that do not participate in DTC, or otherwise take actions in respect of such interest, may be affected by the lack of a certificate or other definitive document representing such interest. DTC has advised us that it will take any action permitted to be taken by a shareholder (including, without limitation, the presentation of a global certificate for exchange) only at the direction of one or more DTC Participants in whose account with DTC interests in global certificates are credited and only in respect of such portion of the aggregate principal amount of the global certificate as to which such DTC Participant or Participants has or have given such direction. Transfer/Application Requirements. All purchasers of UNL s shares, and potentially any purchasers of shares in the future, who wish to become limited partners or other record holders and receive cash distributions, if any, or have certain other rights, must deliver an executed transfer application in which the purchaser or transferee must certify that, among other things, he, she or it agrees to be bound by UNL s LP Agreement and is eligible to purchase UNL s securities. Each purchaser of shares offered by this prospectus must execute a transfer application and certification. The obligation to provide the form of transfer application is imposed on the seller of shares or, if a purchase of shares is made through an exchange, the form may be obtained directly through UNL. Further, USCF may request each record holder to furnish certain information, including that record holder s nationality, citizenship or other related status. A record holder is a shareholder that is, or has applied to be, a limited partner. An investor who is not a U.S. resident may not be eligible to become a record holder or one of UNL s limited partners if that investor s ownership would subject UNL to the risk of cancellation or forfeiture of any of UNL s assets under any federal, state or local law or regulation. If the record holder fails to furnish the information or if USCF determines, on the basis of the information furnished by the holder in response to the request, that such holder is not qualified to become one of UNL s limited partners, USCF may be substituted as a holder for the record holder, who will then be treated as a non-citizen assignee, and UNL will have the right to redeem those securities held by the record holder. A transferee s broker, agent or nominee may complete, execute and deliver a transfer application and certification. UNL may, at its discretion, treat the nominee holder of a share as the absolute owner. In that case, the beneficial holder s rights are limited solely to those that it has against the nominee holder as a result of any agreement between the beneficial owner and the nominee holder. A person purchasing UNL s existing shares, who does not execute a transfer application and certify that the purchaser is eligible to purchase those securities acquires no rights in those securities other than the right to resell those securities. Whether or not a transfer application is received or the consent of USCF obtained, our shares are securities and are transferable according to the laws governing transfers of securities. Any transfer of shares will not be recorded by the transfer agent or recognized by USCF unless a completed transfer application is delivered to USCF or the Administrator. When acquiring shares, the transferee of such shares that completes a transfer application will: be an assignee until admitted as a substituted limited partner upon the consent and sole discretion of USCF and the recording of the assignment on the books and records of the partnership; automatically request admission as a substituted limited partner; agree to be bound by the terms and conditions of, and execute, our LP Agreement; represent that such transferee has the capacity and authority to enter into our LP Agreement; grant powers of attorney to USCF and any liquidator of us; and make the consents and waivers contained in our LP Agreement. An assignee will become a limited partner in respect of the transferred shares upon the consent of USCF and the recordation of the name of the assignee on our books and records. Such consent may be withheld in the sole discretion of USCF. If consent of USCF is withheld such transferee shall be an assignee. An assignee shall have an interest in the partnership equivalent to that of a limited partner with respect to allocations and distributions, including, without limitation, liquidating distributions, of the partnership. With respect to voting rights attributable to shares that are held by assignees, USCF shall be deemed to be the limited partner with respect thereto and shall, in exercising the voting rights in respect of such shares on any matter, vote such shares at the written direction of the assignee who is the record holder of such shares. If no such written direction is received, such shares will not be voted. An assignee shall have no other rights of a limited partner. Until a share has been transferred on our books, we and the transfer agent may treat the record holder of the share as the absolute owner for all purposes, except as otherwise required by law or stock exchange regulations. What is the Plan of Distribution? Buying and Selling Shares Most investors buy and sell shares of UNL in secondary market transactions through brokers. Shares trade on the NYSE Arca under the ticker symbol "UNL". Shares are bought and sold throughout the trading day like other publicly traded securities. When buying or selling shares through a broker, most investors incur customary brokerage commissions and charges. Investors are encouraged to review the terms of their brokerage account for details on applicable charges. Marketing Agent and Authorized Participants The offering of UNL s shares is a best efforts offering. UNL continuously offers Creation Baskets consisting of 50,000 shares through the Marketing Agent, to Authorized Participants. Authorized Participants pay a $350 fee for each order they place to create or redeem one or more Creation Baskets or Redemption Baskets. The Marketing Agent receives, for its services as marketing agent to UNL, a marketing fee of 0.06% on UNL s assets up to the first $3 billion; and 0.04% on UNL s assets in excess of $3 billion, provided, however, that in no event may the aggregate compensation paid to the Marketing Agent and any affiliate of USCF for distribution-related services in connection with this offering exceed ten percent (10%) of the gross proceeds of this offering. The offering of baskets is being made in compliance with Conduct Rule 2310 of FINRA. Accordingly, Authorized Participants will not make any sales to any account over which they have discretionary authority without the prior written approval of a purchaser of shares. The per share price of shares offered in Creation Baskets on any subsequent day is the total NAV of UNL calculated shortly after the close of the core trading session on the NYSE Arca on such day divided by the number of issued and outstanding shares. An Authorized Participant is not required to sell any specific number or dollar amount of shares. When an Authorized Participant executes an agreement with USCF on behalf of UNL (each such agreement, an "Authorized Participant Agreement"), such Authorized Participant becomes part of the group of parties eligible to purchase baskets from, and put baskets for redemption to, UNL. An Authorized Participant is under no obligation to create or redeem baskets, and an Authorized Participant is under no obligation to offer to the public shares of any baskets it does create. As of February 28, 2022, UNL had the following Authorized Participants: Citadel Securities LLC, Citigroup Global Markets, Inc., Credit Suisse Securities USA LLC, JP Morgan Securities, Inc., Merrill Lynch Professional Clearing Corp., Morgan Stanley & Co. LLC, RBC Capital Markets LLC, SG Americas Securities LLC and Virtu Americas LLC. Because new shares can be created and issued on an ongoing basis, at any point during the life of UNL, a "distribution", as such term is used in the 1933 Act, will be occurring. Authorized Participants, other broker-dealers and other persons are cautioned that some of their activities may result in their being deemed participants in a distribution in a manner that would render them statutory underwriters and subject them to the prospectus-delivery and liability provisions of the 1933 Act. For example, the Initial Authorized Participant was a statutory underwriter with respect to its initial purchase of Creation Baskets. In addition, any purchaser who purchases shares with a view towards distribution of such shares may be deemed to be a statutory underwriter. Authorized Participants will comply with the prospectus-delivery requirements in connection with the sale of shares to customers. For example, an Authorized Participant, other broker-dealer firm or its client will be deemed a statutory underwriter if it purchases a Creation Basket from UNL, breaks the Creation Basket down into the constituent shares and sells the shares to its customers; or if it chooses to couple the creation of a supply of new shares with an active selling effort involving solicitation of secondary market demand for the shares. Authorized Participants may also engage in secondary market transactions in shares that would not be deemed "underwriting". For example, an Authorized Participant may act in the capacity of a broker or dealer with respect to shares that were previously distributed by other Authorized Participants. A determination of whether a particular market participant is an underwriter must take into account all the facts and circumstances pertaining to the activities of the broker-dealer or its client in the particular case, and the examples mentioned above should not be considered a complete description of all the activities that would lead to designation as an underwriter and subject them to the prospectus-delivery and liability provisions of the 1933 Act. Dealers who are neither Authorized Participants nor "underwriters" but are nonetheless participating in a distribution (as contrasted to ordinary secondary trading transactions), and thus dealing with shares that are part of an "unsold allotment" within the meaning of Section 4(a)(3)(C) of the 1933 Act, would be unable to take advantage of the prospectus-delivery exemption provided by Section 4(a)(3) of the 1933 Act. USCF may qualify the shares in states selected by USCF and intends that sales be made through broker-dealers who are members of FINRA. Investors intending to create or redeem baskets through Authorized Participants in transactions not involving a broker-dealer registered in such investor s state of domicile or residence should consult their legal advisor regarding applicable broker-dealer or securities regulatory requirements under the state securities laws prior to such creation or redemption. While the Authorized Participants may be indemnified by USCF, they will not be entitled to receive a discount or commission from UNL for their purchases of Creation Baskets. Calculating Per Share NAV UNL s per share NAV is calculated by: Taking the current market value of its total assets; Subtracting any liabilities; and Dividing that total by the total number of outstanding shares. The Administrator, calculates the per share NAV of UNL once each NYSE Arca trading day. The per share NAV for a normal trading day is released after 4:00 p.m. New York time. Trading during the core trading session on the NYSE Arca typically closes at 4:00 p.m. New York time. The Administrator uses the NYMEX closing price (determined at the earlier of the close of the NYMEX or 2:30 p.m. New York time) for the Futures Contracts traded on the NYMEX, but calculates or determines the value of all other UNL investments (including Futures Contracts not traded on the NYMEX, Other Natural Gas-Related Investments and Treasuries) using market quotations, if available, or other information customarily used to determine the fair value of such investments as of the earlier of the close of the NYSE Arca or 4:00 p.m. New York time in accordance with the current Administrative Agency Agreement among the Administrator, UNL and USCF. "Other information" customarily used in determining fair value includes information consisting of market data in the relevant market supplied by one or more third parties including, without limitation, relevant rates, prices, yields, yield curves, volatilities, spreads, correlations or other market data in the relevant market; or information of the types described above from internal sources if that information is of the same type used by UNL in the regular course of its business for the valuation of similar transactions. The information may include costs of funding, to the extent costs of funding are not and would not be a component of the other information being utilized. Third parties supplying quotations or market data may include, without limitation, dealers in the relevant markets, end-users of the relevant product, information vendors, brokers and other sources of market information. In addition, in order to provide updated information relating to UNL for use by investors and market professionals, the NYSE Arca calculates and disseminates throughout the core trading session on each trading day an updated indicative fund value. The indicative fund value is calculated by using the prior day s closing per share NAV of UNL as a base and updating that value throughout the trading day to reflect changes in the most recently reported trade price for the active natural gas Futures Contracts on the NYMEX. The prices reported for those Futures Contract months are adjusted based on the prior day s spread differential between settlement values for the relevant contract and the spot month contract. In the event that the spot month contract is also the Benchmark Futures Contracts, the last sale price for that contract is not adjusted. The indicative fund value share basis disseminated during NYSE Arca core trading session hours should not be viewed as an actual real time update of the per share NAV, because the per share NAV is calculated only once at the end of each trading day based upon the relevant end of day values of UNL s investments. The indicative fund value is disseminated on a per share basis every 15 seconds during regular NYSE Arca core trading session hours of 9:30 a.m. New York time to 4:00 p.m. New York time. The normal trading hours of the NYMEX are 9:00 a.m. New York time to 2:30 p.m. New York time. This means that there is a gap in time at the beginning and the end of each day during which UNL s shares are traded on the NYSE Arca, but real-time NYMEX trading prices for Futures Contracts traded on the NYMEX are not available. During such gaps in time, the indicative fund value will be calculated based on the end of day price of such Futures Contracts from the NYMEX s immediately preceding trading session. In addition, other Futures Contracts, Other Natural Gas-Related Investments and Treasuries held by UNL will be valued by the Administrator, using rates and points received from client-approved third-party vendors (such as Reuters and WM Company) and advisor quotes. These investments will not be included in the indicative fund value. The NYSE Arca disseminates the indicative fund value through the facilities of CTA/CQ High Speed Lines. In addition, the indicative fund value is published on the NYSE Arca s website and is available through on-line information services such as Bloomberg and Reuters. Dissemination of the indicative fund value provides additional information that is not otherwise available to the public and is useful to investors and market professionals in connection with the trading of UNL shares on the NYSE Arca. Investors and market professionals are able throughout the trading day to compare the market price of UNL and the indicative fund value. If the market price of UNL shares diverges significantly from the indicative fund value, market professionals will have an incentive to execute arbitrage trades. For example, if UNL appears to be trading at a discount compared to the indicative fund value, a market professional could buy UNL shares on the NYSE Arca and sell short Futures Contracts. Such arbitrage trades can tighten the tracking between the market price of UNL and the indicative fund value and thus can be beneficial to all market participants. UNL reserves the right to adjust the share price of UNL in the future to maintain convenient trading ranges for investors. Any adjustments would be accomplished through stock splits or reverse stock splits. Such splits would decrease (in the case of a split) or increase (in the case of a reverse split) the proportionate net asset value per share, but would have no effect on the net assets of UNL or the proportionate voting rights of shareholders or limited partners. Creation and Redemption of Shares UNL creates and redeems shares from time to time, but only in one or more Creation Baskets or Redemption Baskets. The creation and redemption of baskets are only made in exchange for delivery to UNL or the distribution by UNL of the amount of Treasuries and any cash represented by the baskets being created or redeemed, the amount of which is based on the combined NAV of the number of shares included in the baskets being created or redeemed determined after 4:00 p.m. New York time on the day the order to create or redeem baskets is properly received. Authorized Participants are the only persons that may place orders to create and redeem baskets. Authorized Participants must be (1) registered broker-dealers or other securities market participants, such as banks and other financial institutions, that are not required to register as broker-dealers to engage in securities transactions as described below, and (2) DTC Participants. To become an Authorized Participant, a person must enter into an Authorized Participant Agreement with USCF on behalf of UNL. The Authorized Participant Agreement provides the procedures for the creation and redemption of baskets and for the delivery of the Treasuries and any cash required for such creations and redemptions. The Authorized Participant Agreement and the related procedures attached thereto may be amended by UNL, without the consent of any limited partner or shareholder or Authorized Participant. Authorized Participants pay a transaction fee of $350 to UNL for each order they place to create one or more Creation Baskets or to redeem one or more Redemption Baskets. The transaction fee may be reduced, increased or otherwise changed by USCF. Authorized Participants who make deposits with UNL in exchange for baskets receive no fees, commissions or other form of compensation or inducement of any kind from either UNL or USCF, and no such person will have any obligation or responsibility to USCF or UNL to effect any sale or resale of shares. Certain Authorized Participants are expected to be capable of participating directly in the physical natural gas market and the natural gas futures market. In some cases, Authorized Participants or their affiliates may from time to time buy natural gas or sell natural gas or Natural Gas Interests and may profit in these instances. USCF believes that the size and operation of the natural gas market makes it unlikely that an Authorized Participant s direct activities in the natural gas or securities markets will significantly affect the price of natural gas, Natural Gas Interests, or the price of the shares. Each Authorized Participant is required to be registered as a broker-dealer under the Exchange Act and is a member in good standing with FINRA, or exempt from being or otherwise not required to be registered as a broker-dealer or a member of FINRA, and qualified to act as a broker or dealer in the states or other jurisdictions where the nature of its business so requires. Certain Authorized Participants may also be regulated under federal and state banking laws and regulations. Each Authorized Participant has its own set of rules and procedures, internal controls and information barriers as it determines is appropriate in light of its own regulatory regime. Under the Authorized Participant Agreement, USCF, and UNL under limited circumstances have agreed to indemnify the Authorized Participants against certain liabilities, including liabilities under the 1933 Act, and to contribute to the payments the Authorized Participants may be required to make in respect of those liabilities. The following description of the procedures for the creation and redemption of baskets is only a summary and an investor should refer to the relevant provisions of the LP Agreement and the form of Authorized Participant Agreement for more detail, each of which is incorporated by reference into this prospectus. Creation Procedures On any business day, an Authorized Participant may place an order with the Marketing Agent to create one or more baskets. For purposes of processing purchase and redemption orders, a "business day" means any day other than a day when any of the NYSE Arca, the NYMEX or the NYSE is closed for regular trading. Purchase orders must be placed by 12:00 p.m. New York time or the close of regular trading on the NYSE Arca, whichever is earlier. The day on which the Marketing Agent receives a valid purchase order is referred to as the purchase order date. By placing a purchase order, an Authorized Participant agrees to deposit Treasuries, cash, or a combination of Treasuries and cash, as described below. Prior to the delivery of baskets for a purchase order, the Authorized Participant must also have wired to the Custodian the nonrefundable transaction fee due for the purchase order. Authorized Participants may not withdraw a creation request, except as otherwise set forth in the procedures in the Authorized Participant Agreement. The manner by which creations are made is dictated by the terms of the Authorized Participant Agreement. By placing a purchase order, an Authorized Participant agrees to (1) deposit Treasuries, cash or a combination of Treasuries and cash with the Custodian, and (2) if required by USCF in its sole discretion, enter into or arrange for a block trade, an exchange for physical or exchange for swap, or any other OTC energy transaction (through itself or a designated acceptable broker) with UNL for the purchase of a number and type of futures contracts at the closing settlement price for such contracts on the purchase order date. If an Authorized Participant fails to consummate (1) and (2), the order shall be cancelled. The number and types of contracts specified shall be determined by USCF, in its sole discretion, to meet UNL s investment objective and shall be purchased as a result of the Authorized Participant s purchase of shares. Determination of Required Deposits The total deposit required to create each Creation Basket ("Creation Basket Deposit") is the amount of Treasuries and/or cash that is in the same proportion to the total assets of UNL (net of estimated accrued but unpaid fees, expenses and other liabilities) on the purchase order date as the number of shares to be created under the purchase order is in proportion to the total number of shares outstanding on the purchase order date. USCF determines, directly in its sole discretion or in consultation with the Administrator, the requirements for Treasuries and the amount of cash, including the maximum permitted remaining maturity of a Treasury and proportions of Treasury and cash that may be included in deposits to create baskets. The Marketing Agent will publish such requirements at the beginning of each business day. The amount of cash deposit required is the difference between the aggregate market value of the Treasuries required to be included in a Creation Basket Deposit as of 4:00 p.m. New York time on the date the order to purchase is properly received and the total required deposit. Delivery of Required Deposits An Authorized Participant who places a purchase order is responsible for transferring to UNL s account with the Custodian the required amount of Treasuries and cash by the end of the second business day following the purchase order date. Upon receipt of the deposit amount, the Administrator directs DTC to credit the number of baskets ordered to the Authorized Participant s DTC account on the second business day following the purchase order date. The expense and risk of delivery and ownership of Treasuries until such Treasuries have been received by the Custodian on behalf of UNL shall be borne solely by the Authorized Participant. Because orders to purchase baskets must be placed by 12:00 p.m., New York time, but the total payment required to create a basket during the continuous offering period will not be determined until after 4:00 p.m. New York time on the date the purchase order is received, Authorized Participants will not know the total amount of the payment required to create a basket at the time they submit an irrevocable purchase order for the basket. UNL s per share NAV and the total amount of the payment required to create a basket could rise or fall substantially between the time an irrevocable purchase order is submitted and the time the amount of the purchase price in respect thereof is determined. Rejection of Purchase Orders USCF acting by itself or through the Marketing Agent shall have the absolute right but no obligation to reject a purchase order or a Creation Basket Deposit if: it determines that the investment alternative available to UNL at that time will not enable it to meet its investment objective; it determines that the purchase order or the Creation Basket Deposit is not in proper form; it believes that the purchase order or the Creation Basket Deposit would have adverse tax consequences to UNL, the limited partners or its shareholders; the acceptance or receipt of the Creation Basket Deposit would, in the opinion of counsel to USCF, be unlawful; or circumstances outside the control of USCF, Marketing Agent or Custodian make it, for all practical purposes, not feasible to process creations of baskets. None of USCF, the Marketing Agent or the Custodian will be liable for the rejection of any purchase order or Creation Basket Deposit. Redemption Procedures The procedures by which an Authorized Participant can redeem one or more baskets mirror the procedures for the creation of baskets. On any business day, an Authorized Participant may place an order with the Marketing Agent to redeem one or more baskets. Redemption orders must be placed by 12:00 p.m. New York time or the close of regular trading on the NYSE Arca, whichever is earlier. A redemption order so received will be effective on the date it is received in satisfactory form by the Marketing Agent ("Redemption Order Date"). The redemption procedures allow Authorized Participants to redeem baskets and do not entitle an individual shareholder to redeem any shares in an amount less than a Redemption Basket, or to redeem baskets other than through an Authorized Participant. By placing a redemption order, an Authorized Participant agrees to deliver the baskets to be redeemed through DTC s book-entry system to UNL, as described below. Prior to the delivery of the redemption distribution for a redemption order, the Authorized Participant must also have wired to UNL s account at the Custodian the non-refundable transaction fee due for the redemption order. An Authorized Participant may not withdraw a redemption order, except as otherwise set forth in the procedures in the Authorized Participant Agreement. The manner by which redemptions are made is dictated by the terms of the Authorized Participant Agreement. By placing a redemption order, an Authorized Participant agrees to (1) deliver the Redemption Basket to be redeemed through DTC s book-entry system to UNL s account with the Custodian not later than 3:00 p.m. New York time on the second business day following the effective date of the redemption order ("Redemption Distribution Date"), and (2) if required by USCF in its sole discretion, enter into or arrange for a block trade, an exchange for physical or exchange for swap, or any other OTC energy transaction (through itself or a designated acceptable broker) with UNL for the sale of a number and type of futures contracts at the closing settlement price for such contracts on the Redemption Order Date. If an Authorized Participant fails to consummate (1) and (2) above, the order shall be cancelled. The number and type of contracts specified shall be determined by USCF, in its sole discretion, to meet UNL s investment objective and shall be sold as a result of the Authorized Participant s sale of shares. Determination of Redemption Distribution The redemption distribution from UNL consists of a transfer to the redeeming Authorized Participant of an amount of Treasuries and/or cash that is in the same proportion to the total assets of UNL (net of estimated accrued but unpaid fees, expenses and other liabilities) on the date the order to redeem is properly received as the number of shares to be redeemed under the redemption order is in proportion to the total number of shares outstanding on the date the order is received. USCF, directly or in consultation with the Administrator, determines the requirements for Treasuries and the amounts of cash, including the maximum permitted remaining maturity of a Treasury, and the proportions of Treasuries and cash that may be included in distributions to redeem baskets. The Marketing Agent will publish an estimate of the redemption distribution per basket as of the beginning of each business day. Delivery of Redemption Distribution The redemption distribution due from UNL will be delivered to the Authorized Participant by 3:00 p.m. New York time on the second business day following the redemption order date if, by 3:00 p.m. New York time on such second business day, UNL s DTC account has been credited with the baskets to be redeemed. If UNL s DTC account has not been credited with all of the baskets to be redeemed by such time, the redemption distribution will be delivered to the extent of whole baskets received. Any remainder of the redemption distribution will be delivered on the next business day to the extent of remaining whole baskets received if UNL receives the fee applicable to the extension of the redemption distribution date which USCF may, from time to time, determine and the remaining baskets to be redeemed are credited to UNL s DTC account by 3:00 p.m. New York time on such next business day. Any further outstanding amount of the redemption order shall be cancelled. Pursuant to information from USCF, the Custodian will also be authorized to deliver the redemption distribution notwithstanding that the baskets to be redeemed are not credited to UNL s DTC account by 3:00 p.m. New York time on the second business day following the redemption order date if the Authorized Participant has collateralized its obligation to deliver the baskets through DTC s book entry-system on such terms as USCF may from time to time determine. Suspension or Rejection of Redemption Orders USCF may, in its discretion, suspend the right of redemption, or postpone the redemption settlement date, (1) for any period during which the NYSE Arca or the NYMEX is closed other than customary weekend or holiday closings, or trading on the NYSE Arca or the NYMEX is suspended or restricted, (2) for any period during which an emergency exists as a result of which delivery, disposal or evaluation of Treasuries is not reasonably practicable, or (3) for such other period as USCF determines to be necessary for the protection of the limited partners or shareholders. For example, USCF may determine that it is necessary to suspend redemptions to allow for the orderly liquidation of UNL s assets at an appropriate value to fund a redemption. If USCF has difficulty liquidating its positions, e.g., because of a market disruption event in the futures markets, a suspension of trading by the exchange where the futures contracts are listed or an unanticipated delay in the liquidation of a position in an OTC contract, it may be appropriate to suspend redemptions until such time as such circumstances are rectified. None of USCF, the Marketing Agent, the Administrator, or the Custodian will be liable to any person or in any way for any loss or damages that may result from any such suspension or postponement. Redemption orders must be made in whole baskets. USCF will reject a redemption order if the order is not in proper form as described in the Authorized Participant Agreement or if the fulfillment of the order, in the opinion of its counsel, might be unlawful. USCF may also reject a redemption order if the number of shares being redeemed would reduce the remaining outstanding shares to 100,000 shares (i.e., two baskets) or less. Creation and Redemption Transaction Fee To compensate UNL for its expenses in connection with the creation and redemption of baskets, an Authorized Participant is required to pay a transaction fee to UNL of $350 per order to create or redeem baskets, regardless of the number of baskets in such order. An order may include multiple baskets. The transaction fee may be reduced, increased or otherwise changed by USCF. USCF shall notify DTC of any change in the transaction fee and will not implement any increase in the fee for the redemption of baskets until thirty (30) days after the date of notice. Tax Responsibility Authorized Participants are responsible for any transfer tax, sales or use tax, stamp tax, recording tax, value added tax or similar tax or governmental charge applicable to the creation or redemption of baskets, regardless of whether or not such tax or charge is imposed directly on the Authorized Participant, and agree to indemnify USCF and UNL if they are required by law to pay any such tax, together with any applicable penalties, additions to tax and interest thereon. Secondary Market Transactions As noted, UNL creates and redeems shares from time to time, but only in one or more Creation Baskets or Redemption Baskets. The creation and redemption of baskets are only made in exchange for delivery to UNL or the distribution by UNL of the amount of Treasuries and cash represented by the baskets being created or redeemed, the amount of which will be based on the aggregate NAV of the number of shares included in the baskets being created or redeemed determined on the day the order to create or redeem baskets is properly received. As discussed above, Authorized Participants are the only persons that may place orders to create and redeem baskets. Authorized Participants must be registered broker-dealers or other securities market participants, such as banks and other financial institutions that are not required to register as broker-dealers to engage in securities transactions. An Authorized Participant is under no obligation to create or redeem baskets, and an Authorized Participant is under no obligation to offer to the public shares of any baskets it does create. Authorized Participants that do offer to the public shares from the baskets they create will do so at per-share offering prices that are expected to reflect, among other factors, the trading price of the shares on the NYSE Arca, the NAV of UNL at the time the Authorized Participant purchased the Creation Baskets and the per share NAV of the shares at the time of the offer of the shares to the public, the supply of and demand for shares at the time of sale, and the liquidity of the Futures Contract market and the market for Other Natural Gas-Related Investments. Shares initially comprising the same basket but offered by Authorized Participants to the public at different times may have different offering prices. An order for one or more baskets may be placed by an Authorized Participant on behalf of multiple clients. Authorized Participants who make deposits with UNL in exchange for baskets receive no fees, commissions or other forms of compensation or inducement of any kind from either UNL or USCF, and no such person has any obligation or responsibility to USCF or UNL to effect any sale or resale of shares. Shares trade in the secondary market on the NYSE Arca. Shares may trade in the secondary market at prices that are lower or higher relative to their per share NAV. The amount of the discount or premium in the trading price relative to the per share NAV may be influenced by various factors, including, among other things, the number of investors who seek to purchase or sell shares in the secondary market, availability of Creation Baskets, the liquidity of the Futures Contracts market and the market for Other Natural Gas-Related Investments. In addition, while UNL s shares trade during the core trading session on the NYSE Arca until 4:00 p.m. New York time, liquidity in the market for Futures Contracts and Other Natural Gas-Related Investments may be reduced after the close of the NYMEX at 2:30 p.m. New York time. UNL s NAV is calculated based on the settlement price of the Benchmark Futures Contracts at 2:30 p.m. New York time and the closing share price of UNL on the NYSE takes in account changes in the price of the Benchmark Futures Contracts that occur after the settlement price is determined. As a result, during this time, trading spreads, and the resulting premium or discount, on the shares may widen. Use of Proceeds USCF causes UNL to transfer the proceeds from the sale of Creation Baskets to the Custodian or other custodian for trading activities. USCF will invest UNL s assets in Natural Gas-Interests and investments in Treasuries, cash and/or cash equivalents. When UNL purchases a Futures Contract and certain exchange-traded Other Natural Gas-Related Investments, UNL is required to deposit typically 5% to 30% with the selling FCMs on behalf of the exchange a portion of the value of the contract or other interest as security to ensure payment for the obligation under Natural Gas Interests at maturity. This deposit is known as initial margin. Counterparties in transactions in OTC contracts will generally impose similar collateral requirements on UNL. USCF will invest the assets that remain after margin and collateral are posted in Treasuries, cash and/or cash equivalents subject to these margin and collateral requirements. USCF has sole authority to determine the percentage of assets that are: held on deposit with the FCMs or other custodian; used for other investments, and held in bank accounts to pay current obligations and as reserves. Approximately 5% to 30% of UNL s assets have normally been committed to margin for commodity futures contracts. However, from time to time, the percentage of assets committed as margin may be substantially more, or less than, such range. An FCM, counterparty, government agency or commodity exchange could increase margin or collateral requirements applicable to UNL to hold trading positions at any time. Ongoing margin and collateral payments will generally be required for both exchange-traded and OTC contracts based on changes in the value of the Natural Gas Interests. Furthermore, ongoing collateral requirements with respect to OTC contracts are negotiated by the parties, and may be affected by overall market volatility, volatility of the underlying commodity or index, the ability of the counterparty to hedge its exposure under a Natural Gas Interests, and each party s creditworthiness. Margin is merely a security deposit and has no bearing on the profit or loss potential for any positions held. In light of the differing requirements for initial payments under exchange-traded and OTC contracts and the fluctuating nature of ongoing margin and collateral payments, it is not possible to estimate what portion of UNL s assets will be posted as margin or collateral at any given time. The Treasuries, cash and cash equivalents held by UNL will constitute reserves that will be available to meet ongoing margin and collateral requirements. All interest income will be used for UNL s benefit. USCF invests the balance of UNL s assets not invested in Natural Gas Interests or held in margin as reserves to be available for changes in margin. All interest income is used for UNL s benefit. The assets of UNL posted as margin for Futures Contracts are held in segregated accounts pursuant to the CEA and CFTC regulations. If UNL enters into a swap agreement, UNL must post both collateral and independent amounts to its swap counterparties. The amount of collateral UNL posts changes according to the amounts owed by UNL to its counterparty on a given swap transaction, while independent amounts are fixed amounts posted by UNL at the start of a swap transaction. Collateral and independent amounts posted to swap counterparties will be held by a third-party custodian. INFORMATION YOU SHOULD KNOW This prospectus contains information you should consider when making an investment decision about the shares. You may rely on the information contained in this prospectus. Neither UNL nor USCF has authorized any person to provide you with different information and, if anyone provides you with different or inconsistent information, you should not rely on it. This prospectus is not an offer to sell the shares in any jurisdiction where the offer or sale of the shares is not permitted. The information contained in this prospectus was obtained from us and other sources believed by us to be reliable. You should rely only on the information contained in this prospectus or any applicable prospectus supplement or any information incorporated by reference to this prospectus. We have not authorized anyone to provide you with any information that is different. If you receive any unauthorized information, you must not rely on it. You should disregard anything we said in an earlier document that is inconsistent with what is included in this prospectus or any applicable prospectus supplement or any information incorporated by reference to this prospectus. Where the context requires, when we refer to this "prospectus," we are referring to this prospectus and (if applicable) the relevant prospectus supplement. You should not assume that the information in this prospectus or any applicable prospectus supplement is current as of any date other than the date on the front page of this prospectus or the date on the front page of any applicable prospectus supplement. We include cross references in this prospectus to captions in these materials where you can find further related discussions. The table of contents tells you where to find these captions. SUMMARY OF PROMOTIONAL AND SALES MATERIAL UNL uses the following promotional or sales material: UNL s website, www.uscfinvestments.com; and UNL fact sheet found on UNL s website. The materials described above are not a part of this prospectus or the registration statement of which this prospectus is a part and have been submitted to the staff of the SEC for their review pursuant to Industry Guide 5. This section is provided here as a convenience to you. INTELLECTUAL PROPERTY USCF owns trademark registrations for the UNITED STATES 12 MONTH NATURAL GAS FUND (U.S. Reg. No. 3783071) for "Financial investment services in the field of natural gas futures contracts, cash-settled options on natural gas futures contracts, forward contracts for natural gas, over-the-counter transactions based on the price of natural gas, and indices based on the foregoing," in use since November 18, 2009, and UNL UNITED STATES 12 MONTH NATURAL GAS FUND, LP (and 12 and Flame Design) (U.S. Reg. No. 4440925) for "Financial investment services in the field of natural gas futures contracts, cash-settled options on natural gas futures contracts, forward contracts for natural gas, over-the-counter transactions based on the price of natural gas, and indices based on the foregoing," in use since September 30, 2012. USCF relies upon these trademarks through which it markets its services and strives to build and maintain brand recognition in the market and among current and potential investors. So long as USCF continues to use these trademarks to identify its services, without challenge from any third party, and properly maintains and renews the trademark registrations under applicable laws, rules and regulations, it will continue to have indefinite protection for these trademarks under current laws, rules and regulations. USCF owns trademark registrations for USCF (and Design) (U.S. Reg. No. 5127374) for "Fund investment services," in use since April 10, 2016, USCF (U.S. Reg. No. 5040755) for "Fund investment services," in use since June 24, 2008, and INVEST IN WHAT S REAL (U.S. Reg. No. 5450808) for "Fund investment services," in use since April 2016. USCF relies upon these trademarks and service mark through which it markets its services and strives to build and maintain brand recognition in the market and among current and potential investors. So long as USCF continues to use these trademarks to identify its services, without challenge from any third party, and properly maintains and renews the trademark registrations under applicable laws, rules and regulations; it will continue to have indefinite protection for these trademarks under current laws, rules and regulations. USCF has been granted two patents Nos. 7,739,186 and 8,019,675, for systems and methods for an exchange traded fund (ETF) that tracks the price of one or more commodities. WHERE YOU CAN FIND MORE INFORMATION USCF has filed on behalf of UNL a registration statement on Form S-1 with the SEC under the 1933 Act. This prospectus does not contain all of the information set forth in the registration statement (including the exhibits to the registration statement), parts of which have been omitted in accordance with the rules and regulations of the SEC. For further information about UNL or the shares, please refer to the registration statement, which you may access online at www.sec.gov. Information about UNL and the shares can also be obtained from UNL s website, http://www.uscfinvestments.com. UNL s website address is only provided here as a convenience to you and the information contained on or connected to the website is not part of this prospectus or the registration statement of which this prospectus is part. UNL is subject to the informational requirements of the Exchange Act and USCF will, on behalf of UNL, file certain reports and other information with the SEC under the Exchange Act. USCF will file an updated prospectus annually for UNL pursuant to the 1933 Act. The reports and other information can be accessed online at www.sec.gov. STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This prospectus includes "forward-looking statements" which generally relate to future events or future performance. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential" or the negative of these terms or other comparable terminology. All statements (other than statements of historical fact) included in this prospectus that address activities, events or developments that will or may occur in the future, including such matters as changes in inflation in the United States, movements in the stock market, movements in U.S. and foreign currencies, and movements in the commodities markets and indexes that track such movements, UNL s operations, USCF s plans and references to UNL s future success and other similar matters, are forward-looking statements. These statements are only predictions. Actual events or results may differ materially. These statements are based upon certain assumptions and analyses USCF has made based on its perception of historical trends, current conditions and expected future developments, as well as other factors appropriate in the circumstances. Whether or not actual results and developments will conform to USCF s expectations and predictions, however, is subject to a number of risks and uncertainties, including the special considerations discussed in this prospectus, general economic, market and business conditions, changes in laws or regulations, including those concerning taxes, made by governmental authorities or regulatory bodies, and other world economic and political developments. See "Risk Factors Involved with an Investment in UNL Consequently, all the forward-looking statements made in this prospectus are qualified by these cautionary statements, and there can be no assurance that the actual results or developments USCF anticipates will be realized or, even if substantially realized, that they will result in the expected consequences to, or have the expected effects on, UNL s operations or the value of the shares. INCORPORATION BY REFERENCE OF CERTAIN INFORMATION We are a reporting company and file annual, quarterly and current reports and other information with the SEC. The rules of the SEC allow us to "incorporate by reference" information that we file with them, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is an important part of this prospectus. This prospectus incorporates by reference the documents set forth below that have been previously filed with the SEC: Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the SEC on March 4, 2022. We will provide to each person to whom a prospectus is delivered, including any beneficial owner, a copy of these filings at no cost, upon written or oral request at the following address or telephone number: United States 12 Month Natural Gas Fund, LP Attention: Katie Rooney 1850 Mt. Diablo Boulevard, Suite 640 Walnut Creek, California 94596 (510) 522-9600 Privacy Policy UNL and USCF may collect or have access to certain nonpublic personal information about current and former investors. Nonpublic personal information may include information received from investors, such as an investor s name, social security number and address, as well as information received from brokerage firms about investor holdings and transactions in shares of UNL. UNL and USCF do not disclose nonpublic personal information except as required by law or as described in their Privacy Policy. In general, UNL and USCF restrict access to the nonpublic personal information they collect about investors to those of their and their affiliates employees and service providers who need access to such information to provide products and services to investors. UNL and USCF maintain safeguards that comply with federal and applicable state law to protect investors nonpublic personal information. These safeguards are reasonably designed to (1) ensure the security and confidentiality of investors records and information, (2) protect against any anticipated threats or hazards to the security or integrity of investors records and information, and (3) protect against unauthorized access to or use of investors records or information that could result in substantial harm or inconvenience to any investor. Third-party service providers with whom UNL and USCF share nonpublic personal information about investors must agree to follow appropriate standards of security and confidentiality, which includes safeguarding such nonpublic personal information physically, electronically and procedurally. A copy of USCF s current Privacy Policy is available at http://www.uscfinvestments.com. PART II Information Not Required in the Prospectus Item 13. Other Expenses of Issuance and Distribution Set forth below is an estimate (except as indicated) of the amount of fees and expenses (other than underwriting commissions and discounts) payable by the registrant in connection with the issuance and distribution of the shares pursuant to the prospectus contained in this registration statement. Amount SEC registration fee (actual) $0 NYSE Arca Listing Fee (actual) $0 FINRA filing fees (actual) N/A Blue Sky expenses N/A Auditor s fees and expenses (estimate) $[ ] Legal fees and expenses (estimate) $[ ] Printing expenses (estimate) $[ ] Total $[ ] Item 14. Indemnification of Directors and Officers Neither USCF nor any employee or other agent of United States 12 Month Natural Gas Fund, LP ("UNL") nor any officer, director, stockholder, partner, employee or agent of USCF (a "Protected Person") shall be liable to any partner or UNL for any mistake of judgment or for any action or inaction taken, nor for any losses due to any mistake of judgment or to any action or inaction or to the negligence, dishonesty or bad faith of any officer, employee, broker or other agent of UNL or any officer, director, stockholder, partner, employee or agent of such General Partner, provided that such officer, director, stockholder, employee, broker or agent of the partner or officer, employee, partner or agent of such General Partner was selected, engaged or retained by such General Partner with reasonable care, except with respect to any matter as to which such General Partner shall have been finally adjudicated in any action, suit or other proceeding not to have acted in good faith in the reasonable belief that such Protected Person s actions was in the best interests of UNL and except that no Protected person shall be relieved of any liability to which such Protected Person would otherwise be subject by reason of willful misfeasance, gross negligence or reckless disregard of the duties involved in the conduct of the Protected Person s office. A General Partner and its officers, directors, employees or partners may consult with counsel and accountants (except for UNL s independent auditors) in respect of UNL affairs and be fully protected and justified in any action or inaction which is taken in accordance with the advice or opinion of such counsel or accountants (except for the Partnership s independent auditors), provided that they shall have been selected with reasonable care. Notwithstanding any of the foregoing to the contrary, this provision hereof shall not be construed so as to relieve (or attempt to relieve) a General Partner (or any employee or other agent thereof or any partner, employee or agent of such General Partner) of any liability to the extent (but only to the extent) that such liability may not be waived, modified or limited under applicable law, but shall be construed so as to effectuate these provisions hereof to the fullest extent permitted by law. UNL shall, to the fullest extent permitted by law, but only out of UNL assets, indemnify and hold harmless the General Partner and each officer, director, employee and agent thereof (including persons who serve at UNL s request as directors, officers or trustees of another organization in which UNL has an interest as a unitholder, creditor or otherwise) and their respective legal representatives and successors (hereinafter referred to as a "Covered Person") against all liabilities and expenses, including but not limited to amounts paid in satisfaction of judgments, in compromise or as fines and penalties, and counsel fees reasonably incurred by any Covered Person in connection with the defense or disposition of any action, suit or other proceedings, whether civil or criminal, before any court or administrative or legislative body, in which such Covered Person may be or may have been involved as a party or otherwise or with which such person may be or may have been threatened, while in office or thereafter, by reason of an alleged act or omission as a General Partner or officer thereof or by reason of its being or having been such a General Partner or officer, except with respect to any matter as to which such Covered Person shall have been finally adjudicated in any such action, suit or other proceeding not to have acted in good faith in the reasonable believe that such Covered Person s action was in the best interest of UNL, and except that no Covered Person shall be indemnified against any liability to UNL or Limited Partners to which such Covered Person would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of such Covered Person s office. Expenses, including counsel fees so incurred by any such Covered Person, may be paid from time to time by UNL in advance of the final disposition of any such action, suit or proceeding on the condition that the amounts so paid shall be repaid to UNL if it is ultimately determined that the indemnification of such expenses is not authorized hereunder. II-1 As to any matter disposed of by a compromise payment by any such Covered Person, pursuant to a consent decree or otherwise, no such indemnification either for said payment or for any other expenses shall be provided unless such compromise shall be approved as in the best interests of UNL, after notice that it involved such indemnification by any disinterested person or persons to whom the questions may be referred by USCF, provided that there has been obtained an opinion in writing of independent legal counsel to the effect that such Covered Person appears to have acted in good faith in the reasonable belief that his or her action was in the best interests of UNL and that such indemnification would not protect such persons against any liability to UNL or its Limited Partners to which such person would otherwise by subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of office. Approval by any disinterested person or persons shall not prevent the recovery from persons as indemnification if such Covered Person is subsequently adjudicated by a court of competent jurisdiction not to have acted in good faith in the reasonable belief that such Covered Person s action was in the best interests of UNL or to have been liable to UNL or its Limited Partners by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of such Covered Person s office. The right of indemnification hereby provided shall not be exclusive of or affect any other rights to which any such Covered Person may be entitled. An "interested Covered Person" is one against whom the action, suit or other proceeding on the same or similar grounds is then or has been pending and a "disinterested person" is a person against whom none of such actions, suits or other proceedings or another action, suit or other proceeding on the same or similar grounds is then or has been pending. Nothing contained herein shall affect any rights to indemnification to which personnel of a General Partner, other than directors and officers, and other persons may be entitled by contract or otherwise under law, nor the power of UNL to purchase and maintain liability insurance on behalf of any such person. Item 15. Recent Sales of Unregistered Securities None. Item 16. Exhibits and Financial Statement Schedules (a) Exhibits Exhibit No. Description 3.1(1) Certificate of Limited Partnership of the registrant. 3.3(8) Third Amended and Restated Agreement of Limited Partnership. 3.4(2) Sixth Amended and Restated Limited Liability Company Agreement of USCF. 5.1* Opinion of Eversheds Sutherland (US) LLP relating to the legality of the Shares. 8.1* Opinion of Eversheds Sutherland (US) LLP with respect to federal income tax consequences. 10.1(7) Form of Authorized Purchaser Agreement. 10.2(5) Marketing Agent Agreement. 10.3(3) Amendment Agreement to the Marketing Agent Agreement. 10.4(4) Second Amendment to Marketing Agent Agreement. 10.5(5) Custodian Agreement 10.6(3) Amendment Agreement to the Custodian Agreement. 10.7(5) Administrative Agency Agreement. II-2 10.8(3) Amendment Agreement to the Administrative Agency Agreement. 10.9(6) Third Amendment to License Agreement between United States Commodity Funds LLC and New York Mercantile Exchange, Inc. 10.10(9) Form of Futures and Cleared Derivatives Transactions Customer Account Agreement with RBC Capital Markets LLC. 10.11(5) Form of Transfer Agency and Service Agreement. 10.12(10) Form of Commodity Futures Customer Agreement with RCG Division of Marex Spectron. 10.13(11) Form of Customer Agreement with E D & F Man Capital Markets Inc. 10.14(12) Form of Customer Agreement with Macquarie Futures USA LLC. 23.1* Consent of Eversheds Sutherland (US) LLP (incorporated by reference to exhibit 5.1 hereto). 23.2* Consent of independent registered public accounting firm. * Filed Herewith. (1)Incorporated by reference to Registrant s Registration Statement on Form S-1 (File No. 333-144409) filed on July 6, 2007. (2)Incorporated by reference to Registrant s Annual Report on Form 10-K for the Year ended December 31, 2015, filed on March 24, 2016. (3)Incorporated by reference to Registrant s Quarterly Report on Form 10-Q for the Quarter ended June 30, 2012, filed on August 14, 2012. (4)Incorporated by reference to Registrant s Annual Report on Form 10-K for the Year ended December 31, 2012, filed on March 26, 2013. (5)Incorporated by reference to Registrant s Current Report on Form 8-K, filed on March 30, 2020. (6)Incorporated by reference to Registrant s report on Form 8-K filed on October 24, 2011. (7)Incorporated by reference to Registrant s Pre-Effective Amendment No. 3 to the Registration Statement on Form S-1 (File No. 333-144409) filed on November 2, 2009. (8)Incorporated by reference to Registrant s report on Form 8-K filed on December 15, 2017. (9)Incorporated by reference to Registrant s Current Report on Form 8-K, filed on October 10, 2013. (10)Incorporated by reference to Registrant s Current Report on Form 8-K, filed on May 29, 2020. (11)Incorporated by reference to Registrant s Current Report on Form 8-K, filed on June 9, 2020. (12)Incorporated by reference to Registrant s Current Report on Form 8-K, filed on December 7, 2020. (b)Financial Statement Schedules The financial statement schedules are either not applicable or the required information is included in the financial statements and footnotes related thereto. Item 17. Undertakings (a) The undersigned registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Securities and Exchange Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement. (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. II-3 (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (4) That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser: (i) If the registrant is subject to Rule 430C ( 230.430C of this chapter), each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A ( 230.430A of this chapter), shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use. (5) That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: (i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424 ( 230.424 of this chapter); (ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; (iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and (iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. (b) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. (c) The undersigned registrant hereby undertakes: (1) To send to each limited partner at least on an annual basis a detailed statement of any transactions with USCF or its affiliates, and of fees, commissions, compensation and other benefits paid, or accrued to USCF or its affiliates for the fiscal year completed, showing the amount paid or accrued to each recipient and the services performed. (2) To provide to the limited partners the financial statements required by Form 10-K for the first full fiscal year of operations of the partnership. II-4 TABLE OF CONTENTS Page Disclosure Document: PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/USAQ_qhslab-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/USAQ_qhslab-inc_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..4cbf8dbafe7820d3fa08f25a841686a5ac54d3c3
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@@ -0,0 +1,97 @@
+PROSPECTUS SUMMARY
+ 4
+
+ 
+ RISK FACTORS
+ 7
+
+ 
+ DESCRIPTION OF BUSINESS
+ 18
+
+ 
+ USE OF PROCEEDS
+ 25
+
+ 
+ MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
+ 25
+
+ 
+ MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
+ 26
+
+ 
+ QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
+ 31
+
+ 
+ DIRECTORS AND EXECUTIVE OFFICERS
+ 31
+
+ 
+ EXECUTIVE COMPENSATION
+ 32
+
+ 
+ SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
+ 32
+
+ 
+ CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
+ 32
+
+ 
+ SELLING STOCKHOLDERS
+ 33
+
+ 
+ PLAN OF DISTRIBUTION
+ 34
+
+ 
+ DESCRIPTION OF CAPITAL STOCK
+ 35
+
+ 
+ SHARES ELIGIBLE FOR FUTURE SALE
+ 39
+
+ 
+ LEGAL MATTERS
+ 39
+
+ 
+ EXPERTS
+ 39
+
+ 
+ DISCLOSURE OF COMMISSION S POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
+ 39
+
+ 
+ WHERE YOU CAN FIND ADDITIONAL INFORMATION
+ 39
+
+ 
+ INDEX TO FINANCIAL STATEMENTS
+ F-1
+
+ 
+ 
+
+The
+registration statement containing this prospectus, including the exhibits to the registration statement, provides additional information
+about us and the common stock offered under this prospectus. The registration statement, including the exhibits, can be read on our website
+and the website of the Securities and Exchange Commission. See Where You Can Find More Information. 
+
+ 
+
+Information
+contained in, and that can be accessed through, our web site www.usaqcorp.com shall not be deemed to be part of this prospectus or incorporated
+herein by reference and should not be relied upon by any prospective investors for the purposes of determining whether to purchase the
+Shares offered hereunder.
+
+ 
+
+ 2
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new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/UVIX_vs-trust_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/UVIX_vs-trust_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..83ba2eb90ac9082c61aaae6b3070ed5ec3bd773b
--- /dev/null
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@@ -0,0 +1,26117 @@
+Summary Fund Rebalancing on p. 17.
+ Being materially under- or overexposed to a Fund s Benchmark may prevent a Fund from achieving a high degree of correlation with its Benchmark. Market disruptions or closures, large movements of assets into or out of a Fund, large rebalances, regulatory restrictions, or market volatility and other factors will adversely affect the Fund s ability to maintain a high degree of correlation.
+
+ Possible illiquid markets may cause or exacerbate losses.
+
+ Financial Instruments cannot always be liquidated at the desired price. It is difficult to execute a trade at a specific price when there is a relatively small volume of buy and sell orders in a market. Market disruptions or volatility can also make it difficult to liquidate a position or find a swap counterparty at a reasonable cost.
+
+ Market illiquidity may cause losses for a Fund. The large size of the positions which a Fund may acquire increases the risk of illiquidity by both making their positions more difficult to liquidate and increasing the losses incurred while trying to do so. Any type of disruption or illiquidity will potentially be exacerbated due to the fact that a Fund will typically invest in Financial Instruments related to a single benchmark, which in many cases is highly concentrated. Limits imposed by counterparties, exchanges or other regulatory organizations, such as accountability levels, position limits and daily price fluctuation limits, may contribute to a lack of liquidity with respect to some Financial Instruments.
+ Fees are charged regardless of a Fund s returns and may result in depletion of assets.
+
+ Each Fund is subject to the fees and expenses described herein which are payable irrespective of the Fund s returns, as well as the effects of commissions, trading spreads, and embedded financing, borrowing costs and fees associated with swaps, futures contracts, and costs relating to the purchase of U.S. Treasury securities or similar high credit quality, short-term fixed-income or similar securities. These fees and expenses have a negative impact on Fund returns.
+
+ The policies of S&P and the CBOE and changes that affect the composition and valuation of the S&P 500, the VIX or an Index could affect the value of an investment in the Shares.
+
+ The policies of S&P and the CBOE concerning the calculation of the level of the S&P 500, the VIX and each Index, and any additions, deletions or substitutions of equity securities, options or futures contracts in the above indexes, respectively, and the manner in which changes affecting the equity securities, options contracts or futures contracts are reflected in the indexes outlined above, could affect the level of such indexes and, therefore, the value of the Shares. S&P can add, delete or substitute the equity securities underlying the S&P 500 or make other methodological changes that could change the level of the S&P 500. S&P and CBOE can also add, delete or substitute the futures contracts underlying the Index or make other methodological changes that could change the level of an Index. The changing of equity securities included in the S&P 500 may affect the S&P 500, as a newly added equity security may perform better or worse than the equity security or securities it replaces. Such a change may also affect the value of the put and call options used to calculate the level of the VIX. The changing of the futures contracts underlying the Index may affect the performance of an Index in similar ways. Additionally, S&P and CBOE may alter, discontinue or suspend calculation or dissemination of the S&P 500 or an Index. Any of these actions could adversely affect the value of the Shares. S&P and CBOE have no obligation to consider shareholder interests in calculating or revising the S&P 500 or an Index. The CBOE can make methodological changes to the calculation of the VIX that could affect the value of VIX futures contracts and, consequently, the value of the Shares. There can be no assurance that the CBOE will not change the VIX calculation methodology in a way which may affect the value of the Shares. Additionally, the CBOE may alter, discontinue or suspend calculation or dissemination of the VIX and/or the exercise settlement value. Any of these actions could adversely affect the value of the Shares.
+ 
+
+ 11
+
+ Table of Contents
+
+ 
+ Calculation of an Index may not be possible or feasible under certain events or circumstances that are beyond the reasonable control of the Sponsor, which in turn may adversely impact both the Index and/or the Shares, as applicable. Additionally, Index calculations may be disrupted by rollover disruptions, rebalancing disruptions and/or market emergencies, which may have an adverse effect on the value of the Shares.
+
+ Additionally, the Short Index is a relatively new index with an inception date of November 22, 2019 and no currently operating fund or account yet seeks to track the Short Index. The Long Index is a new index with an inception date of October 8, 2021 and no currently operating fund or account yet seeks to track the Long Index or an inverse or leveraged version of it. There is the risk that, as a result of the limited operational history of each Index, a Fund may have more difficulty tracking the Index than an index that has had a long operational history.
+
+ Each Fund may be subject to counterparty risks.
+
+ The Funds may use derivatives such as swap agreements and options (collectively referred to herein as derivatives ) in the manner described herein as a means to achieve its investment objective. The use of derivatives by the Funds exposes them to counterparty risks.
+
+ Regulatory Treatment
+
+ Derivatives are generally traded in over-the-counter ( OTC ) markets and have only recently become subject to comprehensive regulation in the United States. Cash-settled forwards are generally regulated as swaps , whereas physically settled forwards are generally not subject to regulation or subject to the federal securities laws (in the case of securities).
+
+ Title VII of the Dodd-Frank Act (as defined below) ( Title VII ) created a regulatory regime for derivatives, with the Commodity Futures Trading Commission (the CFTC ) responsible for the regulation of swaps and the SEC responsible for the regulation of security-based swaps. The SEC requirements have largely yet to be made effective, but the CFTC requirements are largely in place. The CFTC requirements have included rules for some of the types of transactions in which the Funds will engage, including mandatory clearing and exchange trading for certain categories of swaps, reporting, and margin for uncleared swaps. Title VII also created new categories of regulated market participants, such as swap dealers, security-based swap dealers, major swap participants, and major security-based swap participants who are, or will be, subject to significant new capital, registration, recordkeeping, reporting, disclosure, business conduct and other regulatory requirements. The regulatory requirements under Title VII continue to be developed and there may be further modifications that could impact materially and adversely the Funds, the markets in which the Funds trade and the counterparties with which the Funds engage in transactions.
+ As noted, the CFTC rules do not apply to all of the physically settled forward contracts entered into by the Funds. Investors, therefore, may not receive the protection of CFTC regulation or the statutory scheme of the Commodities Exchange Act of 1934 ( CEA ) in connection with the Funds physically settled forward contracts. The lack of regulation in these markets could expose investors to significant losses under certain circumstances, including in the event of trading abuses or financial failure by participants.
+
+ Counterparty Credit Risk
+
+ Each Fund will be subject to the credit risk of the counterparties to derivatives. In the case of cleared derivatives, each Fund will have credit risk to the clearing corporation in a similar manner as each Fund would for futures contracts. In the case of uncleared derivatives, each Fund will be subject to the credit risk of the counterparty to the transaction typically a single bank or financial institution. As a result, each Fund is subject to increased credit risk with respect to the amount it expects to receive from counterparties to uncleared derivatives entered into as part of the Fund s principal investment strategy. If a counterparty becomes bankrupt or otherwise fails to perform its obligations due to financial difficulties, a Fund could suffer significant losses on these contracts and the value of an investor s investment in the Fund may decline.
+ Each Fund generally requires that the counterparties for the Fund agree to post collateral for the benefit of the Fund, marked to market daily, subject to certain minimum thresholds. To the extent any such collateral is insufficient or there are delays in accessing the collateral, each Fund will be exposed to counterparty risk as described above, including possible delays in recovering amounts as a result of bankruptcy proceedings. Each Fund typically enters into transactions only with major, global financial institutions.
+
+ 
+
+ 12
+
+ Table of Contents
+
+ 
+ OTC derivatives of the type that may be utilized by each Fund are generally less liquid than futures contracts because they are not traded on an exchange, do not have uniform terms and conditions, and are generally entered into based upon the creditworthiness of the parties and the availability of credit support, such as collateral, and in general, are not transferable without the consent of the counterparty. These agreements contain various conditions, events of default, termination events, covenants and representations. The triggering of certain events or the default on certain terms of the agreement could allow a party to terminate a transaction under the agreement and request immediate payment in an amount equal to the net positions owed to the party under the agreement. For example, if the level of each Fund s Benchmark has a dramatic intraday move that would cause a material decline in the Fund s NAV, the terms of the swap may permit the counterparty to immediately close out the transaction with the Fund. In that event, it may not be possible for a Fund to enter into another swap or to invest in other Financial Instruments necessary to achieve the desired exposure consistent with the Fund s objective. This, in turn, may prevent a Fund from achieving its investment objective, particularly if the level of the Fund s Benchmark reverses all or part of its intraday move by the end of the day.
+ In addition, cleared derivatives benefit from daily marking-to-market and settlement, and segregation and minimum capital requirements applicable to intermediaries. To the extent a Fund enters into cleared swap transactions, the Fund will deposit collateral with a Futures Commission Merchant ( FCM ) in cleared swaps customer accounts, which are required by CFTC regulations to be separate from its proprietary collateral posted for cleared swaps transactions. Cleared swap customer collateral is subject to regulations that closely parallel the regulations governing customer segregated funds for futures transactions (described above) but provide certain additional protections to cleared swaps collateral in the event of a clearing broker or clearing broker customer default. For example, in the event of a default of both the clearing broker and a customer of the clearing broker, a clearing house is only permitted to access the cleared swaps collateral in the legally separate (but operationally comingled) account of the defaulting cleared swap customer of the clearing broker, as opposed to the treatment of customer segregated funds, under which the clearing house may access all of the commingled customer segregated funds of a defaulting clearing broker. Uncleared derivatives entered into directly between two counterparties do not necessarily benefit from such protections, particularly if entered into with an entity that is not registered as a swap dealer with the CFTC. This exposes a Fund to the risk that a counterparty will not settle a transaction in accordance with its terms and conditions because of a dispute over the terms of the contract (whether or not bona fide) or because of a credit or liquidity problem, thus causing the Fund to suffer a loss.
+ Each counterparty and/or any of its affiliates may be an Authorized Participant or shareholder of a Fund, subject to applicable law.
+
+ The counterparty risk for cleared derivatives transactions is generally lower than for uncleared OTC derivatives. Once a transaction is cleared, the clearing organization is substituted and is a Fund s counterparty on the derivative. The clearing organization guarantees the performance of the other side of the derivative. Nevertheless, some risk remains, as there is no assurance that the clearing organization, or its members, will satisfy its obligations to a Fund.
+
+ Risks Related to a Fund s Investments in Options
+
+ Transactions in options generally require less capital than equivalent stock transactions. They may return smaller dollar figures but a potentially greater percentage of the investment than equivalent stock transactions.
+
+ The potential profit is limited to the premium received for the contract. The potential loss is often unlimited. While leverage means the percentage returns can be significant, the amount of cash required is smaller than equivalent stock transactions. It is possible to lose the entire principal invested, and sometimes more. As an options holder, a Fund risks the entire amount of the premium it pays. But as an options writer, it takes on a much higher level of risk. For example, if the Fund writes an uncovered call, it faces unlimited potential loss, since there is no cap on how high a stock price can rise. When buying options, a Fund risks losing the premium paid, plus commissions and fees.
+ Each Fund may change its investment objective, Index, Benchmark and strategies at any time.
+
+ The Sponsor has the authority to change each Fund s investment objective, Index, Benchmark or investment strategy at any time without shareholder approval. Although such changes may be subject to applicable regulatory approvals, the Sponsor may determine to operate a Fund in accordance with its new investment objective, Index, 
+
+ 
+
+ 13
+
+ Table of Contents
+
+ 
+ Benchmark or strategy while those approvals are pending. Changes in the Fund s investment objective, Index, Benchmark or strategy, may occur without shareholder approval and with limited advance notice to shareholders and may expose shareholders to losses on their investments in a Fund.
+
+ A change to the investment objective, Index, Benchmark or strategies or the liquidation of the Fund could occur at a time that is disadvantageous to shareholders.
+
+ Each Fund may be liquidated at any time, including a time that is disadvantageous to shareholders.
+
+ The Sponsor has the authority to liquidate a Fund at any time without shareholder approval. There is also the risk that a Fund will liquidate shortly after it has suffered sudden and substantial losses as a result of volatile markets. Liquidation of a Fund may occur without shareholder approval and with limited advance notice to shareholders and may expose shareholders to losses on their investments in the Fund. Liquidation of a Fund could occur at a time that is disadvantageous to shareholders. When a Fund s assets are sold as part of the Fund s liquidation, the resulting proceeds distributed to shareholders may be less than those that may be realized in a sale outside of a liquidation context.
+ Each Fund uses investment techniques that may be considered aggressive.
+
+ Some investment techniques of a Fund, such as its use of Financial Instruments, may be considered aggressive. Risks associated with Financial Instruments include potentially dramatic price changes (losses) in the value of the instruments and imperfect correlations between the price of the contract and the underlying reference asset. The use of Financial Instruments may increase the volatility of a Fund and may involve a small investment of cash relative to the magnitude of the risk assumed.
+
+ Historical correlation trends between a Fund s Benchmark and other asset classes may not continue or may reverse, limiting or eliminating any potential diversification or other benefit from owning a Fund.
+
+ To the extent that an investor purchases a Fund seeking diversification benefits based on the historic correlation (whether positive or negative) between the Fund or its Benchmark and other asset classes, such historic correlation may not continue or may reverse itself. In this circumstance, the diversification or other benefits sought may be limited or non-existent. The diversification or other benefits sought by an investor in a Fund may also become limited or cease to exist if the Sponsor determines to change a Fund s Benchmark or otherwise modify the Fund s investment objective or strategy.
+
+ The lack of active trading markets for the Shares may result in losses upon the sale or disposition of such Shares.
+
+ Although the Shares are publicly listed and traded on the Exchange, there can be no guarantee that an active trading market for the Shares will develop or be maintained. If investors need to sell their Shares at a time when an active market for such Shares does not exist, the price investors receive for their Shares, assuming that investors are able to sell them at all, likely will be lower than the price that investors would receive if an active market did exist.
+
+ Investors may be adversely affected by redemption or creation orders that are subject to postponement, suspension or rejection under certain circumstances.
+
+ A Fund may, in its discretion, suspend the right of creation or redemption or may postpone the redemption or purchase settlement date, for (1) any period during which the Exchange or any other exchange, marketplace or trading center, deemed to affect the normal operations of the Fund, is closed, or when trading is restricted or suspended on such exchanges in the Fund s futures contracts, (2) any period during which an emergency exists as a result of which the fulfilment of a purchase order or the redemption distribution is not reasonably practicable, or (3) such other period as the Sponsor determines to be necessary for the protection of the shareholders of the Fund. In addition, a Fund will reject a redemption order if the order is not in proper form as described in the Authorized Participant Agreement or if the fulfilment of the order might be unlawful. Any such postponement, suspension or rejection could adversely affect a redeeming Authorized Participant. For example, the resulting delay may adversely affect the value of the Authorized Participant s redemption proceeds if the NAV of the Fund declines during the period of delay. A Fund disclaims any liability for any loss or damage that may result from any such suspension or postponement. Suspension of creation privileges may adversely impact how the Shares are traded and arbitraged on the secondary market, which could cause them to trade at levels materially different (premiums and discounts) from the fair value of their underlying holdings.
+ 
+
+ 14
+
+ Table of Contents
+
+ 
+ The NAV per Share may not correspond to the market price per Share.
+
+ The NAV per Share of a Fund changes as fluctuations occur in the market value of the Fund s portfolio. Investors should be aware that the public trading price per Share of a Fund may be different from the NAV per Share of the Fund (i.e., the secondary market price may trade at a premium or discount to NAV). The price at which an investor may be able to sell Shares at any time, especially in times of market volatility, may be significantly less than the NAV per Share of a Fund at the time of sale. Consequently, an Authorized Participant may be able to create or redeem a Creation Unit of a Fund at a discount or a premium to the public trading price per Share of a Fund.
+ Authorized Participants or their customers may have an opportunity to realize a profit if they can purchase a Creation Unit at a discount to the public trading price of the Shares of a Fund or can redeem a Creation Unit at a premium over the public trading price of the Shares of the Fund. The Sponsor expects that the exploitation of such arbitrage opportunities by Authorized Participants and their clients and customers will tend to cause the public trading price to track the NAV per Share of a Fund closely over time.
+
+ Investors who purchase Shares in the secondary market and pay a premium purchase price over a Fund s indicative optimized portfolio value ( IOPV ), which is also known as the intraday indicative value or IIV, could incur significant losses in the event such investor sells the Fund Shares at a time when such premium is no longer present in the marketplace.
+
+ Also, the NAV of a Share may not correspond to its market price due to differences in timing. NAV is typically calculated as of 4:00 p.m. (Eastern Time). The Shares of a Fund trade on the Exchange during the hours the Exchange is open for trading, typically from 9:30 a.m. to 4:00 p.m. (Eastern Time).
+
+ Investors may be adversely affected by an overstatement or understatement of a Fund s NAV due to the valuation method employed or errors in the NAV calculation.
+
+ Under normal circumstances, the NAV of a Fund reflects the value of the Financial Instruments held by the Fund, as of the time the NAV is calculated. The NAV includes, in part, any unrealized profits or losses on open Financial Instrument positions. Additionally, in calculating the NAV of a Fund, VIX futures contracts are valued using the Time Weighted Average Price (TWAP) of the futures during the last 15 minutes of NYSE s regular trading session, rather than solely from the VIX futures settlement price. In certain circumstances (e.g., if the Sponsor believes market quotations do not accurately reflect fair value of an investment, or a trading halt closes an exchange or market early), the Sponsor may, in its sole discretion, choose to determine a fair value price as the basis for determining the market value of such position for such day. The fair value of an investment determined by the Sponsor may be different from other value determinations of the same investment. Such fair value prices generally would be determined based on available inputs about the current value of the underlying Reference Assets and would be based on principles that the Sponsor deems fair and equitable. Errors in calculation of a Fund s NAV also may cause the Fund NAV to be overstated or understated and may affect the performance of the Fund and the value of an investment in the Shares.
+ The number of underlying components included in the Index may impact volatility, which could adversely affect an investment in the Shares.
+
+ A Fund s Index is concentrated solely in VIX futures contracts. Investors should be aware that other volatility indexes may be more diversified in terms of both the number and variety of instruments included or in terms of the volatility exposure offered. Concentration in fewer underlying components may result in a greater degree of volatility in an Index and the NAV of a Fund which tracks that index under specific market conditions and over time.
+
+ Competing claims of intellectual property rights may adversely affect a Fund and an investment in the Shares.
+
+ The Sponsor believes that it has properly licensed or obtained the appropriate consent of all necessary parties with respect to intellectual property rights. However, other third parties could allege ownership as to such rights and may bring legal action asserting their claims. The expenses in litigating, negotiating, cross-licensing or otherwise settling such claims may adversely affect a Fund. Additionally, as a result of such action, a Fund could potentially change its investment objective, strategies or benchmark. Each of these factors could have a negative impact on the performance of a Fund.
+
+ 
+
+ 15
+
+ Table of Contents
+
+ 
+ Authorized Participants with large holdings in a Fund are able to effect transactions which could adversely affect an investment in the Shares.
+
+ In the event that one or more Authorized Participants which have substantial interests in the Shares withdraw from participation, the liquidity of the Shares will likely decrease, which could adversely affect the market price of the Shares and result in investors incurring a loss on their investment.
+
+ Shareholders that are not Authorized Participants may only purchase or sell their Shares in secondary trading markets, and the conditions associated with trading in secondary markets may adversely affect investors investment in the Shares.
+
+ Only Authorized Participants may create or redeem Creation Units. All other investors that desire to purchase or sell Shares must do so through the Exchange or in other markets, if any, in which the Shares may be traded. Shares may trade at a premium or discount to NAV per Share or the IOPV.
+
+ The Exchange may halt trading in the Shares of a Fund, which would adversely impact investors ability to sell Shares.
+
+ Trading in Shares of a Fund may be halted by the Exchange due to market conditions or, in light of the applicable Exchange rules and procedures. In addition, trading in Shares is subject to trading halts caused by market volatility pursuant to circuit breaker rules that require trading to be halted for a specified period based on a specified decline or rise in a market index (e.g., the Dow Jones Industrial Average) or in the price of a Fund s Shares. There can be no assurance that the requirements necessary to maintain the listing of the Shares of a Fund will continue to be met or will remain unchanged.
+ The value of the Shares will be adversely affected because a Fund is required to indemnify Wilmington Trust Company (the Trustee ) and/or the Sponsor.
+
+ Under the Trust Agreement, the Trustee and the Sponsor each has the right to be indemnified for any liability or expense incurred without gross negligence or willful misconduct. That means the Sponsor may require the assets of a Fund to be sold in order to cover losses or liability suffered by it or by the Trustee. Any such sale would decrease the value of an investment in a Fund.
+
+ Although the Shares are limited liability investments, certain circumstances, such as the bankruptcy of a Fund, could increase a shareholder s liability.
+
+ The Shares are limited liability investments; investors may not lose more than the amount that they invest plus any gains or income recognized on their investment. However, shareholders could be required, as a matter of bankruptcy law, to return to the estate of a Fund any distribution they received at a time when the Fund was in fact insolvent or in violation of the Trust Agreement.
+
+ The insolvency of an FCM or clearing organization or the failure of an FCM or clearing organization to properly segregate Fund assets held as margin on futures transactions may result in losses to a Fund.
+
+ The CEA requires FCMs to segregate client assets received as margin on futures transactions from their own proprietary assets. However, if an FCM fails to properly segregate Fund assets deposited as margin, these assets might not be fully protected in the event of the FCM s bankruptcy. In such event, a Fund may not be able to recover any assets held by the FCM, or may recover only a limited portion of such assets.
+
+ Furthermore, customer funds held at a clearing organization in connection with any futures contracts are permitted to be held in a commingled omnibus account that does not identify the name of the clearing member s individual customers. A clearing organization may use assets held in such accounts to satisfy payment obligations of a defaulting customer of the FCM to the clearing organization. As a result, in the event of a default of one or more of the FCM s other clients together with the bankruptcy or insolvency of the FCM, a Fund may not be able to recover the assets deposited by the FCM on behalf of the Fund with the clearing organization.
+
+ In the event of a bankruptcy or insolvency of any exchange or a clearing house, the Fund could experience a loss of the funds deposited through its FCM as margin with the exchange or clearing house, a loss of any profits on its open positions on the exchange, and the loss of unrealized profits on its closed positions on the exchange.
+
+ 
+
+ 16
+
+ Table of Contents
+
+ 
+ There may be circumstances that could prevent or make it impractical for a Fund to operate in a manner consistent with its investment objective and principal investment strategy.
+
+ There may be circumstances outside the control of the Sponsor and/or a Fund that could prevent or make it impractical to re-position the Fund s portfolio investments, to process purchase or redemption orders, or to otherwise operate the Fund in a manner consistent with its investment objective and principal investment strategy. Examples of such circumstances include: market disruptions; significant market volatility, particularly late in a trading day; natural disasters; public service disruptions or utility problems such as those caused by fires, floods, extreme weather conditions, and power outages resulting in telephone, telecopy, and computer failures; market conditions or activities causing trading halts; systems failures involving computer or other information systems affecting the aforementioned parties, as well as the Depository Trust Company ( DTC ), the National Securities Clearing Corporation ( NSCC ), or any other participant in the trading or operation of the Fund; and other extraordinary events.
+ While the Sponsor has implemented and tested a business and a disaster recovery plan designed to address circumstances such as those described above, these and other circumstances may prevent a Fund from being operated in a manner consistent with its investment objective and/or principal investment strategy.
+
+ Due to the increased use of technologies, intentional and unintentional cyber-attacks pose operational and information security risks.
+
+ With the increased use of technologies such as the Internet and the dependence on computer systems to perform necessary business functions, a Fund and its service providers are susceptible to operational and information security risks. In general, cyber incidents can result from deliberate attacks or unintentional events. Cyber-attacks include, but are not limited to gaining unauthorized access to digital systems for purposes of misappropriating assets or sensitive information, corrupting data, or causing operational disruption. Cyber-attacks may also be carried out in a manner that does not require gaining unauthorized access, such as causing denial-of-service attacks on websites. Cyber security failures or breaches of a Fund s third-party service providers (including, but not limited to, the index provider, the Sponsor, the Commodity Sub-Adviser, the Administrator, Sub-Administrator, Custodian, FCM and Transfer Agent) have the ability to cause disruptions and impact business operations, potentially resulting in financial losses, the inability of Fund shareholders to transact business, violations of applicable privacy and other laws, regulatory fines, penalties, reputational damage, reimbursement or other compensation costs, and/or additional compliance costs. In addition, substantial costs may be incurred in order to prevent any cyber incidents in the future. A Fund and its shareholders could be negatively impacted as a result. While a Fund has established business continuity plans and systems to prevent such cyber-attacks, there are inherent limitations in such plans and risk management systems including the possibility that certain risks have not been identified. Furthermore, a Fund cannot control the cyber security plans and systems of the Fund s service providers, market makers, Authorized Participants or issuers of securities in which the Fund invests.
+ Investors cannot be assured of the Sponsor s continued services, the discontinuance of which may be detrimental to a Fund.
+
+ Investors cannot be assured that the Sponsor will be able to continue to service a Fund for any length of time. If the Sponsor discontinues its activities on behalf of a Fund, the Fund may be adversely affected, as there may be no entity servicing the Fund for a period of time. If the Sponsor s registrations with the CFTC or memberships in the NFA were revoked or suspended, the Sponsor would no longer be able to provide services and/or to render advice to a Fund. If the Sponsor were unable to provide services and/or advice to a Fund, the Fund would be unable to pursue its investment objectives unless and until the Sponsor s ability to provide services and advice to the Fund was reinstated or a replacement for the Sponsor as commodity pool operator could be found. Such an event could result in termination of a Fund.
+ Risks Applicable to Investing in VIX Futures Contracts and Other Financial Instruments
+
+ VIX futures contracts can be highly volatile and a Fund may experience sudden and large losses when buying, selling or holding such instruments; you can lose all or a portion of your investment within a single day.
+
+ Investments linked to equity market volatility, including VIX futures contracts, can be highly volatile and may experience sudden, large and unexpected losses. For example, in 2018, similar indexes which were comprised of VIX futures contracts, had their largest one-day move ever of approximately 96%. In the future, an Index could have even 
+
+ 
+
+ 17
+
+ Table of Contents
+
+ 
+ larger single-day or intraday moves, up or down, that could cause investors to lose all or a substantial portion of their investment in a short period of time. VIX futures contracts are unlike traditional futures contracts and are not based on a tradable reference asset. The VIX is not directly investable, and the settlement price of a VIX futures contract is based on the calculation that determines the level of the VIX. As a result, the behavior of a VIX futures contract may be different from a traditional futures contract whose settlement price is based on a specific tradable asset and may differ from an investor s expectations. The market for VIX futures contracts may fluctuate widely based on a variety of factors including changes in overall market movements, political and economic events and policies, wars, acts of terrorism, natural disasters, changes in interest rates or inflation rates. High volatility may have an adverse impact on the performance of a Fund. An investor in a Fund could experience substantial losses and even potentially lose the full principal of his or her investment within a single day, the risk of which is heightened during periods of high market volatility.
+ Recent market volatility, particularly from January 2020 through the date of this Prospectus, that is seemingly the result of the negative impacts of COVID-19 on global and domestic markets and the response thereto by governments and their central banks, has acutely affected the performance of each Index over those periods.
+
+ The following chart shows the performance of the Long Index and the Short Index (each from the first full calendar month of performance after their inception) and the VIX, all through the year-ended December 2021. The Short Index has an inception date of November 22, 2019. The Long Index has an inception date of October 8, 2021. 
+
+ 
+
+ 
+ 
+
+ Month 
+
+ 
+ 
+ 
+ Long 
+Index 
+
+ 
+ 
+ 
+ Short
+Index 
+
+ 
+ 
+ 
+ VIX 
+
+ 
+ 
+
+ 
+ 
+ December 2019 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 5.79 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ 9.19 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ January 2020 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (9.91 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 36.72 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ February 2020 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (38.62 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 112.90 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ March 2020 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (68.18 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 33.48 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ April 2020 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 13.74 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (36.22 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ May 2020 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 6.82 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (19.44 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ June 2020 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (15.52 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 10.61 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ July 2020 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 14.77 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (19.62 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ August 2020 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 5.82 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ 7.97 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ September 2020 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2.06 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (0.15 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ October 2020 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (11.99 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 44.18 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ November 2020 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 49.23 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (45.90 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ December 2020 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1.27 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ 10.60 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ January 2021 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (26.02 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 45.45 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ February 2021 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 24.86 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (15.53 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ March 2021 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 34.77 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (30.59 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ April 2021 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 10.93 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (4.07 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ May 2021 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 6.24 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (9.94 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ June 2021 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 14.17 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (5.55 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ July 2021 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (8.16 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 15.22 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ August 2021 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 15.57 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (9.65 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ September 2021 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (12.07 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 40.41 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ October 2021 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 27.60 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (29.73 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ November 2021 
+
+ 
+ 
+ 
+ 18.64 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (24.77 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 67.22 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ December 2021 
+
+ 
+ 
+ 
+ (26.93 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 28.75 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (36.67 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ The use of leveraged or inverse positions increases risk and could result in the total loss of an investor s investment within a single day.
+
+ UVIX seeks investment results, before fees and expenses, that correspond to twice the performance of the Long Index for a single day. UVIX utilizes leverage in seeking to achieve its investment objective and will lose more money in market environments adverse to its daily investment objective than funds that do not employ leverage. The use of leveraged positions increases risk and could result in the total loss of an investor s investment within a single day. The more UVIX invests in leveraged positions, the more this leverage will magnify any losses on 
+
+ 
+
+ 18
+
+ Table of Contents
+
+ 
+ those investments. UVIX s investments in leveraged positions generally requires a small investment relative to the amount of investment exposure assumed. As a result, such investments may give rise to losses that far exceed the amount invested in those instruments. For example, because UVIX includes a two times (2x) multiplier, a single-day movement in the Long Index approaching 50% at any point in the day could result in the total loss or near total loss of an investment in the Fund if that movement is contrary to the investment objective of UVIX. In the case where a single-day movement in the Long Index is contrary to the investment objective of the UVIX Fund and approaches 50% at any point during the day, UVIX may sell a significant portion of its leveraged long VIX futures position which may result in the total loss or almost total loss of an investment in the Fund, even if the Long Index subsequently moves in an opposite direction. 
+ SVIX seeks daily investment results, before fees and expenses, that correspond to the performance of the Short Index for a single day. SVIX utilizes short positions in VIX futures contracts in seeking to achieve its investment objective and will lose money in market environments adverse to its daily investment objective. The use of short positions increases risk and could result in the total loss of an investor s investment within a single day. SVIX s investments in short positions generally requires a small investment relative to the amount of investment exposure assumed. As a result, such investments may give rise to losses that far exceed the amount invested in those instruments. For example, because SVIX includes a minus one (-1x) multiplier, a single-day movement in the Index approaching 100% at any point in the day could result in the total loss or almost total loss of an investment in the Fund if that movement is contrary to the investment objective of SVIX. In the case where a single-day movement in the Short Index is contrary to the investment objective of the SVIX Fund and approaches 100% at any point during the day, the SVIX Fund may buy back a significant portion of its short VIX futures position which may result in the total loss or almost total loss of an investment in the Fund, even if the Index subsequently moves in an opposite direction.
+ The Short Index settled on March 16, 2020 41.64% below its settlement on the previous business day (its most significant single day decline since its inception). If SVIX had met its investment objective corresponding to the performance of the Short Index on that day, SVIX may have lost that amount equaling 41.64% before fees and expenses in a single day. It is not possible to predict when sudden large changes in the daily movement of a benchmark may occur and future changes may be significantly larger than historic changes. 
+
+ The Long Index settled on November 29, 2021 13.80% below its settlement on the previous business day (its most significant single day decline since its inception). If UVIX had met its investment objective corresponding to the performance of the Long Index on that day, UVIX may have lost that amount equaling 27.60% before fees and expenses in a single day. It is not possible to predict when sudden large changes in the daily movement of a benchmark may occur and future changes may be significantly larger than historic changes. 
+
+ Daily rebalancing of the futures contracts underlying an Index or a Benchmark may impact trading in the underlying futures contracts.
+
+ The daily rebalancing of the futures contracts underlying an Index or Benchmark may impact trading in such futures contracts and adversely affect the value of the Funds. For example, such trading may cause a Fund s FCMs to adjust their hedges. The trading activity associated with such transactions will contribute to the existing trading volume of the underlying futures contracts and may adversely affect the market price of such underlying futures contracts and in turn the level of the Index or Benchmark.
+
+ Each Fund generally is intended to be used as a trading tool for short-term investment horizons and investors holding shares of a Fund over longer-term periods may be subject to increased risk of loss.
+
+ Each Fund generally is intended to be used only for short-term investment horizons. An investor in a Fund can lose all or a substantial portion of his or her investment within a single day. The longer an investor s holding period in a Fund, the greater the potential for loss.
+
+ 
+
+ 19
+
+ Table of Contents
+
+ 
+ SVIX is benchmarked to the Short Index and UVIX is benchmarked to twice the Long Index. SVIX is not benchmarked to the inverse of the VIX and UVIX is not benchmarked to twice the VIX. The performance of the Funds should be expected to vary from the inverse (-1x) or twice (2x) the performance of either the VIX or a portfolio of VIX futures contracts over the same period. As a result, SVIX should be expected to perform very differently from the inverse performance of either the VIX or a portfolio of short-term VIX futures contracts over all periods of time, and UVIX should be expected to perform very differently from twice the performance of either the VIX or a portfolio of short-term VIX futures contracts over all periods of time.
+ The VIX seeks to measure the market s current expectation of 30-day volatility of the S&P 500 Index, as reflected by the prices of near-term S&P 500 options. The market s current expectation of the possible rate and magnitude of movements in an index is commonly referred to as the implied volatility of the index. Because S&P 500 options derive value from the possibility that the S&P 500 may experience movement before such options expire, the prices of near-term S&P 500 options are used to calculate the implied volatility of the S&P 500.
+ The VIX is not an investable index. It is not practical to invest in the VIX as it is comprised of a constantly changing portfolio of options on the S&P 500. Rather, the VIX is designed to serve as a market volatility forecast. Neither Fund is benchmarked to the performance of the VIX or the realized volatility of the S&P 500 and, in fact, can be expected to perform very differently from the VIX and the realized volatility of the S&P 500 over all periods of time.
+
+ The prices of futures contracts based on a non-investable index such as the VIX may behave differently from the prices of futures contracts whose settlement price is based on a tradeable asset.
+
+ SVIX
+
+ The performance of the Short Index is based on the value of the VIX short-term futures contracts that comprise the Short Index. While there is a relationship between the performance of the Short Index and future levels of the VIX, the performance of the Short Index is not directly linked to the inverse performance of the VIX, to the realized volatility of the S&P 500 or to the options that underlie the calculation of the VIX. As a result, the Short Index and the Fund should be expected to perform very differently from the inverse performance of either the VIX or a portfolio of short-term VIX futures contracts over all periods of time. In many cases, the Short Index and the Fund will underperform the inverse of the VIX. Further, the performance of the Short Index and the Fund should not be expected to represent the realized volatility of the S&P 500 or the inverse thereof.
+ As noted, the Fund is benchmarked against an underlying index of VIX short-term futures contracts. The value of a VIX futures contract is based on the expected value of the VIX at a future point in time, specifically the expiration date of the VIX futures contract. Therefore, a VIX futures contract represents the forward implied volatility of the VIX, and the forward implied volatility of the S&P 500, over the 30-day period following the expiration of such contract. As a result, a change in the VIX today will not necessarily result in a corresponding movement in the price of VIX futures contracts since the price of the VIX futures contracts is based on expectations of the performance of the VIX at a future point in time. For example, a VIX futures contract purchased in March that expires in May, in effect, is a forward contract on what the level of the VIX, as a measure of 30-day implied volatility of the S&P 500, will be on the May expiration date. The forward volatility reading of the VIX may not correlate directly to the current volatility reading of the VIX because the implied volatility of the S&P 500 at a future expiration date may be different from the current implied volatility of the S&P 500. As a result, the Index and the Fund should be expected to perform very differently from the VIX over all periods of time.
+ UVIX
+
+ The performance of twice the Long Index is based on the value of twice the VIX short-term futures contracts that comprise the Long Index. While there is a relationship between the performance of the Long Index and future levels of the VIX, the performance of twice the Long Index is not directly linked to twice the performance of the VIX, to twice the realized volatility of the S&P 500 or to twice the value of the options that underlie the calculation of the VIX. As a result, twice the Long Index and the performance of the Fund should be expected to perform very differently from twice the performance of either the VIX or twice a portfolio of short-term VIX futures contracts over all periods of time. In many cases, twice the Long Index and the performance of the Fund will underperform twice the performance of the VIX. Further, the performance of twice the Long Index and the performance of the Fund should not be expected to represent the realized volatility of the S&P 500 or twice thereof.
+ 
+
+ 20
+
+ Table of Contents
+
+ 
+ As noted, the Fund is benchmarked against twice an underlying index of VIX short-term futures contracts. The value of a VIX futures contract is based on the expected value of the VIX at a future point in time, specifically the expiration date of the VIX futures contract. Therefore, a VIX futures contract represents the forward implied volatility of the VIX, and the forward implied volatility of the S&P 500, over the 30-day period following the expiration of such contract. As a result, a change in the VIX today will not necessarily result in a corresponding movement in the price of VIX futures contracts since the price of the VIX futures contracts is based on expectations of the performance of the VIX at a future point in time. For example, a VIX futures contract purchased in March that expires in May, in effect, is a forward contract on what the level of the VIX, as a measure of 30-day implied volatility of the S&P 500, will be on the May expiration date. The forward volatility reading of the VIX may not correlate directly to the current volatility reading of the VIX because the implied volatility of the S&P 500 at a future expiration date may be different from the current implied volatility of the S&P 500. As a result, twice the performance of the Long Index and the Fund should be expected to perform very differently from the VIX, or twice thereof, over all periods of time.
+ Any increase or decrease in the level of the VIX may impact Fund performance
+
+ The potential gains of short exposure to VIX futures contracts is limited due to significant and unexpected reversals in the level of the VIX and corresponding VIX futures contracts which will have a negative impact on the performance of the Funds. Additionally, rebalancing during these reversals can significantly increase costs and negatively impact performance of the Funds. 
+
+ Potential negative impact from rolling futures positions; there have been extended periods in the past where the investment strategies utilized by the Funds have caused significant and sustained losses. 
+
+ Each Fund intends to, or may, have exposure to VIX futures contracts and each Fund is subject to risks related to rolling such futures contracts, which is the process by which a Fund closes out a futures position prior to its expiration month and purchases an identical futures contract with a later expiration date. The Funds do not intend to hold futures contracts through expiration, but instead intend to roll their respective positions as they approach expiration. The contractual obligations of a buyer or seller holding a futures contract to expiration may be satisfied by settling in cash as designated in the contract specifications. As explained further below, the price of futures contracts farther from expiration may be higher (a condition known as contango ) or lower (a condition known as backwardation ), which can impact the Funds returns. 
+ When the market for these futures contracts is such that the prices are higher in the more distant delivery months than in the nearer delivery months, the sale during the course of the rolling process of the more nearby futures contract would take place at a price that is lower than the price of the more distant futures contract. This pattern of higher prices for longer expiration futures contracts is often referred to as contango. Alternatively, when the market for these futures contracts is such that the prices are higher in the nearer months than in the more distant months, the sale during the course of the rolling process of the more nearby futures contract would take place at a price that is higher than the price of the more distant futures contract. This pattern of higher prices for shorter expiration futures contracts is referred to as backwardation. The presence of contango in certain futures contracts at the time of rolling would be expected to adversely affect the Funds with long positions, and positively affect the Funds with short positions. Similarly, the presence of backwardation in certain futures contracts at the time of rolling such contracts would be expected to adversely affect the Funds with short positions and positively affect the Funds with long positions. 
+ For example, on January 3, 2022, the shortest dated monthly VIX futures contract expiring on January 19, 2022, settled at 18.86 and the next shortest dated monthly contract expiring on February 16, 2022, settled at 21.41. This is an example of futures in contango. Conversely on January 25, 2022, the shortest dated monthly VIX futures contract expiring on February 16, 2022, settled at 28.16, while the next shortest dated monthly contract expiring on March 15, 2022, settled at 27.73. This is an example of futures in backwardation. In a large majority of trading sessions between Jan 1, 2015 and the date of this Prospectus, VIX futures contracts traded in contango. 
+ Additionally, because of the frequency with which the Funds may roll futures contracts, the impact of such contango or backwardation on Fund performance may be greater than it would have been if the Funds rolled futures contracts less frequently. In April 2020, the market for crude oil futures contracts experienced a period 
+
+ 
+
+ 
+
+ 21
+
+ Table of Contents
+
+ 
+ of extraordinary contango that resulted in a negative price in the May 2020 WTI crude oil futures contract. It is possible that the futures contracts held by the Funds also may experience periods of extraordinary contango in the future. 
+
+ The value of Shares relates directly to the value of, and realized gain or loss from, the Financial Instruments and other assets held by a Fund. Fluctuations in the price of these Financial Instruments or assets could materially adversely affect an investment in the Shares. 
+
+ Several factors may affect the price and/or liquidity of VIX futures contracts and other assets, if any, owned by a Fund, including, but not limited to:
+
+ Prevailing market prices and forward volatility levels of the U.S. and global stock markets, the S&P 500, the equity securities included in the S&P 500 and prevailing market prices of options on the S&P 500, the VIX, options on the VIX, the relevant VIX futures contracts, or any other financial instruments related to the S&P 500 and the VIX or VIX futures contracts;
+
+ Interest rates;
+
+ Inflation rates and investors expectations concerning inflation rates;
+
+ Economic, financial, political, regulatory, geographical, judicial and other events that affect the level of the Index or the market price or forward volatility of the U.S. and global stock markets, the equity securities included in the S&P 500, the S&P 500, the VIX or the relevant futures or option contracts on the VIX;
+
+ Supply and demand as well as hedging activities in the listed and over-the-counter ( OTC ) equity derivatives markets;
+
+ The level of margin requirements;
+
+ The position limits imposed by FCMs and Exchanges;
+
+ Disruptions in trading of the S&P 500, futures contracts on the S&P 500 or options on the S&P 500
+
+ The level of contango or backwardation in the VIX futures contracts market; and
+
+ The trading activity of other funds following similar indexes or trading similar strategies
+
+ Each of these factors could have a negative impact on the value of the Funds. These factors interrelate in complex ways, and the effect of one factor on the market value of a Fund may offset or enhance the effect of another factor.
+
+ Margin requirements for VIX futures contracts and position limits imposed by FCMs and Exchanges may limit a Fund s ability to achieve sufficient exposure and prevent a Fund from achieving its investment objective.
+
+ Each Fund may enter into written agreements with one or more FCMs governing the terms of the Fund s futures transactions cleared by such FCM. Because futures contracts typically require only a relatively small initial investment, they may involve a high degree of leverage. A Fund must provide margin when it invests in a futures contract. Such margin requirements are subject to change suddenly and without warning at any time during the term of the contract and could be substantial in the event of adverse price movements or volatility. High margin requirements could prevent a Fund from obtaining sufficient exposure to futures contracts and may prevent or have a significant adverse impact on a Fund s ability to achieve its investment objective. If a margin call is not met within a reasonable time, an FCM may close out a Fund s position which may prevent the Fund from achieving its investment objective. If a Fund has insufficient cash to meet daily margin requirements, it may need to sell Financial Instruments at a time when such sales are disadvantageous. An FCM s failure to return required margin to a Fund on a timely basis may cause the Fund to delay redemption settlement dates and/or restrict, postpone or limit the right of redemption and could also have a negative impact on a Fund s ability to achieve its investment objective. 
+ 
+
+ 
+
+ 
+
+ 22
+
+ Table of Contents
+
+ 
+ Exchanges impose futures contract position limits and accountability levels on the Funds and the Funds may be subject to new or more restrictive position limits or accountability levels in the future. If a Fund reaches a position limit or accountability level or becomes subject to a daily limit, its ability to issue new Creation Units or reinvest in additional commodity futures contracts may be limited to the extent these restrictions limit its ability to establish new futures positions, add to existing positions, or otherwise transact in futures. 
+
+ Certain of the FCMs utilized by the Funds may impose their own position limits , or risk limits, on the Funds. Any such risk limits restrict the amount of exposure to futures contracts that a Fund can obtain through such FCMs. These risk limits may, for example, be imposed as a result of significant and/or rapid increases in the size of the Fund as a result of an increase in creation activity. As a result, a Fund may need to transact through a number of FCMs in order to achieve its investment objective. If enough FCMs are not willing to transact with a Fund, or if the risk limits imposed by such FCMs do not provide sufficient exposure, the Fund may not be able to achieve its investment objective. In addition, in such instances, a Fund may limit or suspend the purchase of Creation Units since the Fund may be unable to invest the cash received from such Creation Unit in sufficient futures transactions to meet its investment objective. As discussed elsewhere herein, the limitation or suspension of Creation Units could cause a Fund s Shares to trade at significant premiums or discounts and otherwise disrupt secondary market trading of Fund Shares. 
+ Futures markets are highly volatile, and may become more volatile during periods of general market and/or economic volatility, and the use of or exposure to futures contracts may increase volatility of a Fund s NAV. 
+
+ VIX futures contracts in particular have been subject to periods of sudden and extreme volatility. As a result, margin requirements for VIX futures contracts are higher than those for most other types of futures contracts. In addition, the FCMs utilized by the Funds may impose margin requirements in addition to those imposed by the clearinghouse. Margin requirements are subject to change, and may be raised in the future by either or both of the clearinghouse and the FCMs. High margin requirements could prevent a Fund from obtaining sufficient exposure to VIX futures contracts and may adversely affect a Fund s ability to achieve its investment objective. An FCM s failure to return required margin to a Fund on a timely basis may cause such Fund to delay redemption settlement dates and/or restrict, postpone or limit the right of redemption. 
+ The Index may underperform other asset classes and may underperform other indices or benchmarks based upon VIX futures contracts, which can have an adverse impact on the value of Fund Shares. 
+
+ Each Fund s performance is linked to an Index maintained by a third-party provider unaffiliated with the Funds or the Sponsor. There can be no guarantee or assurance that the methodology used by the third-party provider to create the Indexes will result in the Funds achieving high, or even positive, returns. Further, there can be no guarantee that the methodology underlying an Index or the daily calculation of each Index will be free from error. It is also possible that third parties may attempt to manipulate the value of an Index or the VIX. Each Index may underperform other asset classes and may underperform other indices or benchmarks based upon the VIX futures contracts. Each of these factors could have a negative impact on the performance of the Funds.
+ Calculation of a benchmark may not be possible or feasible under certain events or circumstances that are beyond the reasonable control of the Sponsor, which in turn may adversely impact both the benchmark and/or the value of the Shares as applicable. Additionally, benchmark calculations are subject to error and may be disrupted by rollover disruptions, rebalancing disruptions and/or market emergencies, which may have an adverse effect on the value of the Shares.
+
+ In addition, the CBOE can make methodological changes to the calculation of the VIX that could affect the value of VIX futures contracts and, consequently, the value of Fund Shares. There can be no assurance that the CBOE will not change the VIX calculation methodology in a way which may affect the value of Fund Shares. The CBOE may also alter, discontinue or suspend calculation or dissemination of the VIX and/or exercise settlement value. S&P Dow Jones Indices may also make changes to the equity securities underlying the S&P 500 or the futures contracts included in the Index, or make other methodological changes that could change the level of the S&P 500. Any of these actions could adversely affect the value of Fund Shares.
+ 
+
+ 23
+
+ Table of Contents
+
+ 
+ It may not be possible to gain exposure to a Benchmark using exchange-traded Financial Instruments.
+
+ Each Fund intends to utilize exchange-traded Financial Instruments. However, it may not be possible to gain exposure to a Fund s Benchmark with these Financial Instruments. If these Financial Instruments cease to be traded on regulated exchanges, they may be replaced with Financial Instruments traded on trading facilities that are subject to lesser degrees of regulation or, in some cases, no substantive regulation. As a result, trading in such Financial Instruments, and the manner in which prices and volumes are reported by the relevant trading facilities, may not be subject to the provisions of, and the protections afforded by, the Commodity Exchange Act or other applicable statutes and related regulations that govern trading on regulated U.S. futures exchanges. In addition, many electronic trading facilities have only recently initiated trading and do not have significant trading histories.
+ Concentration Risk
+
+ Each Fund will typically concentrate its investments in long or short positions in first- and second-month VIX futures contracts. Investors should be aware that other volatility investments may be more diversified both in terms of the number and variety of instruments included and of the volatility exposure offered.
+
+ Concentration exclusively in long or short positions in first- and second-month futures contracts may result in a greater degree of volatility and adverse performance of a Fund under specific market conditions and over time. Concentration in fewer futures contracts as opposed to exposure to a broader set of futures contracts may increase the risk of a Fund s trading activity affecting such futures contracts and this may adversely affect the performance of a Fund.
+
+ For example, such concentration may cause the daily rolling or rebalancing of a Fund s portfolio to adversely impact the market price of its concentrated portfolio of futures contracts and in turn the level of the Benchmark and the performance of a Fund.
+
+ Risks Related to Regulation and Federal Income Tax Consequences
+
+ Shareholders do not have the protections associated with ownership of shares in an investment company registered under the 1940 Act.
+
+ Each Fund is not subject to registration or regulation under the 1940 Act. Consequently, shareholders do not have the regulatory protections provided to investors in investment companies registered under the 1940 Act. These protections include, but are not limited to, provisions in the 1940 Act that limit transactions with affiliates, prohibit the suspension of redemptions (except under limited circumstances), require a board of directors that must include disinterested directors, limit leverage, impose a fiduciary duty on the fund s managers with respect to the receipt of compensation for services, require shareholder approval for certain fundamental changes, limit sales loads, and require proper valuation of fund assets.
+ Shareholders tax liability will exceed cash distributions on the Shares.
+
+ Shareholders of each Fund are subject to U.S. federal income taxation and, in some cases, state, local, or foreign income taxation on their share of a Fund s taxable income, whether or not they receive cash distributions from the Fund. Each Fund does not currently expect to make distributions with respect to capital gains or ordinary income. Accordingly, Fund shareholders will not receive cash distributions equal to their share of their Fund s taxable income or the tax liability that results from such income. Each Fund s income, gains, losses and deductions are allocated to shareholders on a monthly basis. If you own Shares in a Fund at the beginning of a month and sell them during the month, you are generally still considered a shareholder through the end of that month.
+ The U.S. Internal Revenue Service (the IRS ) could adjust or reallocate items of income, gain, deduction, loss and credit with respect to the Shares if the IRS does not accept the assumptions or conventions utilized by a Fund.
+
+ U.S. federal income tax rules applicable to partnerships, which a Fund is anticipated to be treated as under the Internal Revenue Code of 1986, as amended (the Code ), are complex and their application is not always clear. Moreover, the rules generally were not written for, and in some respects are difficult to apply to, publicly traded interests in partnerships. Each Fund applies certain assumptions and conventions intended to comply with the 
+
+ 
+
+ 24
+
+ Table of Contents
+
+ 
+ intent of the rules and to report income, gain, deduction, loss and credit to shareholders in a manner that reflects the shareholders economic gains and losses, but these assumptions and conventions may not comply with all aspects of the applicable Regulations (as defined below). It is possible therefore that the IRS will successfully assert that these assumptions or conventions do not satisfy the technical requirements of the Code or the Treasury regulations promulgated thereunder (the Regulations ) and will require that items of income, gain, deduction, loss and credit be adjusted or reallocated in a manner that could be adverse to investors.
+ Shareholders will receive partner information tax returns on Schedule K-1, which could increase the complexity of tax returns.
+
+ The partner information tax returns on Schedule K-1, which a Fund will distribute to shareholders, will contain information regarding the income items and expense items of a Fund. If you have not received Schedule K-1s from other investments, you may find that preparing your tax return may require additional time, or it may be necessary for you to retain an accountant or other tax preparer, at an additional expense to you, to assist you in the preparation of your return.
+
+ Investors could be adversely affected if the current treatment of short-term capital gains under current U.S. federal income tax law is changed or repealed in the future.
+
+ Under current law, short-term capital gains are taxed to non-corporate investors at reduced U.S. federal income tax rates. This tax treatment may be adversely affected, changed or repealed by future changes in, or the expiration of, tax laws at any time.
+
+ Shareholders of a Fund may recognize significant amounts of ordinary income and short-term capital gains.
+
+ Due to a Fund s investment strategy, it may realize and pass through to shareholders significant amounts of ordinary income and short-term capital gains as opposed to short-term capital gains, which generally are taxed at a preferential rate. A Fund s income, gains, losses and deductions are allocated to shareholders on a monthly basis. If you own Shares in a Fund at the beginning of a month and sell them during the month, you are generally still considered a shareholder through the end of that month.
+
+ Changes in U.S. federal income tax law could affect an investment in the Shares.
+
+ Recently enacted legislation commonly known as the Tax Cuts and Jobs Act has made significant changes to U.S. federal income tax rules. As of the date of this registration statement, the short-term impact of the Tax Cuts and Jobs Act, including on the Shares, is unclear. Prospective investors are urged to consult their tax advisors regarding the effect of the Tax Cuts and Jobs Act prior to investing in the Shares.
+
+ PROSPECTIVE INVESTORS ARE STRONGLY URGED TO CONSULT THEIR OWN TAX ADVISORS AND COUNSEL WITH RESPECT TO THE POSSIBLE TAX CONSEQUENCES TO THEM OF AN INVESTMENT IN THE SHARES OF A FUND; SUCH TAX CONSEQUENCES MAY DIFFER IN RESPECT OF DIFFERENT INVESTORS.
+
+ Regulatory changes or actions, including the implementation of new legislation, may alter the operations and profitability of a Fund.
+
+ On October 4, 2021, Gary Gensler, Chair of the SEC, issued a statement on complex exchange-traded products whereby he directed the staff of the Securities and Exchange Commission to study the potential risks of complex financial products that are listed on exchanges and present recommendations of the Commission s consideration on potential rulemaking proposals to address those risks. While it is difficult to know what form such rulemaking proposals might take or what substantive content they main contain, there is a possibility that any such future regulatory changes could have a material impact on the ability of the Funds to continue to offer and sell Shares in the Funds. The effect of any future regulatory change on the Fund is impossible to predict, but could be substantial and adverse.
+ 
+
+ 25
+
+ Table of Contents
+
+ 
+ The U.S. derivatives markets and market participants have been subject to comprehensive regulation, not only by the CFTC but also by self-regulatory organizations, including the NFA and the exchanges on which the derivatives contracts are traded and/or cleared. As with any regulated activity, changes in regulations may have unexpected results. For example, changes in the amount or quality of the collateral that traders in derivatives contracts are required to provide to secure their open positions, or in the limits on number or size of positions that a trader may have open at a given time, may adversely affect the ability of a Fund to enter into certain transactions that could otherwise present lucrative opportunities. Considerable regulatory attention has been focused on non-traditional investment pools which are publicly distributed in the United States. There is a possibility of future regulatory changes altering, perhaps to a material extent, the nature of an investment in a Fund or the ability of the Fund to continue to implement its investment strategy.
+ In addition, the SEC, CFTC and the exchanges are authorized to take extraordinary actions in the event of a market emergency, including, for example, the retroactive implementation of speculative position limits or higher margin requirements, the establishment of daily price limits and the suspension of trading. The regulation of swaps, forwards and futures transactions in the United States is a rapidly changing area of law and is subject to modification by government and judicial action. The effect of any future regulatory change on the Fund is impossible to predict, but could be substantial and adverse.
+
+ In particular, the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act ) has made and will continue to make sweeping changes to the way in which the U.S. financial system is supervised and regulated. Title VII of the Dodd-Frank Act sets forth a legislative framework for OTC derivatives, including certain Financial Instruments, such as swaps, in which a Fund may invest. Title VII of the Dodd-Frank Act makes broad changes to the OTC derivatives market, grants significant new authority to the SEC and the CFTC to regulate OTC derivatives and market participants, and, pursuant to regulations that have been and will continue to be adopted by the regulators, requires the clearing and exchange trading of many types of OTC derivatives transactions.
+ Pursuant to regulations adopted by the CFTC, swap dealers are required to be registered and are subject to various regulatory requirements, including, but not limited to, margin, recordkeeping, reporting and various business conduct requirements, as well as proposed minimum financial capital requirements.
+
+ Pursuant to the Dodd-Frank Act, regulations adopted by the CFTC and the federal banking regulators that are now in effect require swap dealers to post and collect variation margin (comprised of specified liquid instruments and subject to a required haircut) in connection with trading of OTC swaps with a Fund. These requirements may increase the amount of collateral a Fund is required to provide and the costs associated with providing it.
+
+ OTC swap agreements submitted for clearing are subject to minimum initial and variation margin requirements set by the relevant clearing house, as well as margin requirements mandated by the CFTC, SEC and/or federal banking regulators. Swap dealers also typically demand the unilateral ability to increase a Fund s collateral requirements for cleared swap agreements beyond any regulatory and clearing house minimums. Such requirements may make it more difficult and costly for investment funds, such as a Fund, to enter into customized transactions. They may also render certain strategies in which a Fund might otherwise engage impossible or so costly that they will no longer be economical to implement. If a Fund decides to execute swap agreements through such exchanges or execution facilities, the Fund would be subject to the rules of the exchange or execution facility, which would bring additional risks and liabilities, and potential requirements under applicable regulations and under rules of the relevant exchange or execution facility.
+ With respect to cleared OTC derivatives, a Fund will not face a clearing house directly but rather will do so through a swap dealer that is registered with the CFTC or SEC and that acts as a clearing member. A Fund may face the indirect risk of the failure of another clearing member customer to meet its obligations to its clearing member. This risk could arise due to a default by the clearing member on its obligations to the clearing house triggered by a customer s failure to meet its obligations to the clearing member.
+
+ 
+
+ 26
+
+ Table of Contents
+
+ 
+ Swap dealers also are required to post margin to the clearing houses through which they clear their customers trades instead of using such margin in their operations, as was widely permitted before Dodd-Frank. This has increased and will continue to increase the swap dealers costs, and these increased costs are generally passed through to other market participants such as a Fund in the form of higher upfront and mark-to-market margin, less favorable trade pricing, and the imposition of new or increased fees, including clearing account maintenance fees.
+
+ While certain regulations have been promulgated and are already in effect, the full impact of the Dodd-Frank Act on a Fund remains uncertain. The legislation and the related regulations that have been and may be promulgated in the future may negatively impact a Fund s ability to meet its investment objective either through limits on its investments or requirements imposed on it or any of its counterparties. In particular, new requirements, including capital requirements and mandatory clearing of OTC derivatives transactions, which may increase derivative counterparties costs and are expected to generally be passed through to other market participants in the form of higher upfront and mark-to-market margin, less favorable trade pricing, and the imposition of new or increased fees, including clearing house account maintenance fees, may increase the cost of a Fund s investments and the cost of doing business, which could adversely affect investors.
+ Regulatory and exchange accountability levels may restrict the creation of Creation Units and the operation of the Trust.
+
+ Many U.S. commodities exchanges limit the amount of fluctuation permitted in futures contract prices during a single trading day by regulations referred to as daily price fluctuation limits or daily limits. Once the daily limit has been reached in a particular contract, no trades may be made that day at a price beyond that limit or trading may be suspended for specified periods during the trading day. In addition, the CFTC, U.S. futures exchanges and certain non-U.S. exchanges have established limits referred to as speculative position limits or accountability levels on the maximum net long or short futures positions that any person may hold or control in derivatives traded on such exchanges.
+ In connection with these limits, the Dodd-Frank Act has required the CFTC to adopt regulations establishing speculative position limits applicable to regulated futures and OTC derivatives and impose aggregate speculative position limits across regulated U.S. futures, OTC positions and certain futures contracts traded on non-U.S. exchanges. In December 2016, the CFTC re-proposed rules on position limits with respect to the 25 physical delivery commodity futures and options contracts, as well as to swaps that are economically equivalent to such contracts. The re-proposed position limits would apply with respect to contracts traded on all U.S. and certain foreign exchanges on an aggregate basis. In addition, the CFTC proposed amendments to the requirement of U.S. commodities exchanges to establish corresponding speculative position limits (the Position Limit Rules ). The re-proposed Position Limit Rules are based on the position limit rules previously proposed in 2013 by the CFTC. In December 2016, the CFTC also adopted final regulations requiring that all accounts owned or managed by an entity that is responsible for such accounts trading decisions, their principals and their affiliates would be aggregated for position limit purposes. The CFTC is expected to reconsider the re-proposed Position Limit Rules in 2019.
+ Although it is unclear what future position limit rules will be, the Sponsor and the Commodity Sub-Advisory are subject to current position and accountability limits established by the CFTC and exchanges. Accordingly, it may be required to reduce the size of outstanding positions or not enter into new positions that would otherwise be taken for a Fund or not trade certain markets on behalf of the Fund in order to comply with those limits or any futures limits established by the CFTC and the relevant exchanges. Derivatives contract prices could move to a limit for several consecutive trading days with little or no trading, thereby preventing prompt liquidation of derivatives positions and potentially subjecting a Fund to substantial losses or periods in which the Fund does not create additional Creation Units. Modification of trades made by the Trust, if required, could adversely affect the Trust s operations and profitability and limit the Trust s ability to reinvest income in additional contracts, create additional Creation Units, or add to existing positions in the desired amount.
+ In addition, the Sponsor or the Commodity Sub-Adviser may be required to liquidate certain open positions in order to ensure compliance with the speculative position limits at unfavorable prices, which may result in substantial losses for a Fund. There also can be no assurance that the Sponsor or the Commodity Sub-Adviser will liquidate positions held on behalf of all the Sponsor s or the Commodity Sub-Adviser s accounts, respectively, including any 
+
+ 
+
+ 27
+
+ Table of Contents
+
+ 
+ proprietary accounts, in a proportionate manner. In the event the Sponsor or the Commodity Sub-Adviser chooses to liquidate a disproportionate number of positions held on behalf of a Fund at unfavorable prices, the Fund may incur substantial losses and the value of the Shares may be adversely affected.
+
+ Further, in October 2012, CFTC rules became effective, which require each registered FCM to establish risk-based limits on position and order size. As a result, the Trust s FCMs may be required to reduce their internal limits on the size of the positions they will execute or clear for a Fund, and the Trust may seek to use additional FCMs, which may increase the costs for the Fund and adversely affect the value of the Shares.
+
+ The Trust may apply to the CFTC or to the relevant exchanges for relief from certain position limits. If the Trust is unable to obtain such relief, a Fund s ability to issue new Creation Units, or the Fund s ability to reinvest income in additional futures contracts, may be limited to the extent these activities cause the Trust to exceed applicable position limits. Limiting the size of a Fund may affect the correlation between the price of the Shares, as traded on an exchange, and the net asset value of the Fund. Accordingly, the inability to create additional Creation Units or add to existing positions in the desired amount could result in Shares trading at a premium or discount to NAV.
+ 
+
+ 28
+
+ Table of Contents
+
+ 
+ CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
+
+ This Prospectus and the documents incorporated by reference in this Prospectus contain forward-looking statements that are subject to risks and uncertainties. Investors can identify these forward-looking statements by the use of expressions such as may, will, expect, anticipate, believe, intend, plan, project, should, estimate , seek or any negative or other variations on such expression. These forward-looking statements are based on information currently available to the Sponsor and are subject to a number of risks, uncertainties and other factors, both known, such as those described in Risk Factors and elsewhere in this Prospectus and the documents incorporated by reference in this Prospectus, and unknown, that could cause the actual results, performance, prospects or opportunities of a Fund to differ materially from those expressed in, or implied by, these forward-looking statements.
+ 
+
+ 29
+
+ Table of Contents
+
+ 
+ DESCRIPTION OF THE FUNDS INDEXES
+
+ The Short VIX Futures Index
+
+ The Short Index is an excess return index designed to express the daily inverse performance of a theoretical portfolio of first and second month VIX futures contracts that are rolled daily. The theoretical portfolio consists of the two nearest term monthly VIX futures contracts that are rolled daily so that the nearest month VIX futures contract is rolled to the second nearest month VIX futures contracts in equal daily fractional amounts. This portfolio rolling seeks to maintain a constant weighted average time to maturity of approximately one month.
+
+ The Short Index determines its daily settlement price from the Time Weighted Average Price (TWAP) of its theoretical portfolio of futures during the last 15 minutes of NYSE s regular trading session, rather than solely from the VIX futures settlement price.
+
+ The Short Index is calculated and maintained by Cboe Global Indexes (the Index Provider ). The Index Provider is not a registered broker-dealer, but is affiliated with a broker-dealer. The Index Provider has implemented and will maintain a fire wall with respect to its relevant personnel regarding access to information concerning the composition and/or changes to the Index. In addition, the Index Provider has implemented and will maintain procedures around the relevant personnel that are designed to prevent the use and dissemination of material, non-public information regarding the Index.
+ These rules and the formula may be changed from time to time, and without notice by the Sponsor, S&P, and/or the CBOE.
+
+ The Index is calculated according to the following methodology:
+
+ Calculation of the Short Index
+
+ On any Business Day (t) when the Short Index is calculated, the Index value is determined as follows:
+
+ 
+
+ Where:
+
+ Business Day (t) is defined as any day when the CFE market is open.
+
+ indext = The Index Settlement value on any Business Day (t) the Index is calculated.
+
+ indext 1 = The Index Settlement value on the preceding Business Day (t-1).
+
+ PDRt = Portfolio Daily Return on any Business Day (t) is determined as follows:
+
+ 
+
+ Where:
+
+ CWm1,t 1= Contract Weight and represents the weighting of the shortest dated monthly VIX Futures Contract (m1) calculated on any Business Day (t-1) as follows:
+ 
+
+ Where:
+
+ RDrem = Roll Days Remaining and is determined each Business Day as the number of remaining Business Days within a Roll Period beginning with, and including, the following Business Day, and ending with, but excluding, the following CBOE VIX monthly Futures Settlement Date (usually a Wednesday). The number of business days does not consider, and therefore continues to include as Business Days, any new holidays introduced intra-month, or unscheduled market closures.
+ 
+
+ 30
+
+ Table of Contents
+
+ 
+ RDtot = Roll Days Total and is determined at the beginning of a new Roll Period as the total number of Business Days within a Roll Period beginning with, and including, the monthly CBOE VIX Futures Settlement Date (usually a Wednesday), and ending with, but excluding, the following CBOE VIX monthly Futures Settlement Date. The number of Business Days stays constant if a new holiday is introduced intra-month after the CBOE VIX Futures Settlement Date, or in the case of an unscheduled market closure.
+ Note On each Business Day a fraction of the theoretical portfolio s m1 VIX futures holdings are sold and the longer dated m2 futures are bought. The fraction rolled each Business Day is therefore proportional to the number of m1 futures contracts held on Business Day t1 and inversely proportional to the number of days in the Roll Period RDtot.
+ CPm1,t= Contract Reference Price of the shortest dated monthly VIX Futures Contract (m1) on any business day (t) determined as the average of the 180 last prices for m1 during regular trading and the 180 last Trade At Settlement (TAS) prices for m1 both taken every 5 seconds beginning 14 minutes and 55 seconds before the closing time of the regular trading session on the NYSE and ending at the closing time of the NYSE usually the average of every 5 seconds between 3.45.05 PM ET and 4.00.00 pm ET each business day.
+ CRPm1,t 1 = Contract Reference Price of the shortest dated monthly VIX Futures Contract (m1) on the previous business day (t-1) determined as the average of the 180 last prices for m1 during regular trading and the 180 last Trade At Settlement (TAS) prices for m1 both taken every 5 seconds beginning 14 minutes and 55 seconds before the closing time of the regular trading session on the NYSE and ending at the closing time of the NYSE usually the average of every 5 seconds between 3.45.05 PM ET and 4.00.00 pm ET each business day.
+ The Roll Period starts on the CBOE VIX Monthly Futures Settlement Date usually the Wednesday falling 30 calendar days before the S&P 500 option expiration for the following month and runs to the Tuesday prior to the subsequent month s CBOE VIX Monthly Futures Settlement Date. On the Business Day after the current roll period ends the following roll period begins.
+
+ The Long VIX Futures Index
+
+ The Long Index is an excess return index designed to express the performance of a theoretical portfolio of long positions in first and second month VIX futures contracts that are rolled daily. The theoretical portfolio consists of the two nearest term monthly VIX futures contracts that are rolled daily so that the nearest month VIX futures contract is rolled to the second nearest month VIX futures contracts in equal daily fractional amounts. This portfolio rolling seeks to maintain a constant weighted average time to maturity of approximately one month.
+
+ The Long Index determines its daily settlement price from the Time Weighted Average Price (TWAP) of its theoretical portfolio of futures during the last 15 minutes of NYSE s regular trading session, rather than solely from the VIX futures settlement price.
+
+ The Long Index is calculated and maintained by Cboe Global Indexes (the Index Provider ). The Index Provider is not a registered broker-dealer, but is affiliated with a broker-dealer. The Index Provider has implemented and will maintain a fire wall with respect to its relevant personnel regarding access to information concerning the composition and/or changes to the Index. In addition, the Index Provider has implemented and will maintain procedures around the relevant personnel that are designed to prevent the use and dissemination of material, non-public information regarding the Index.
+ These rules and the formula may be changed from time to time, and without notice by the Sponsor, S&P, and/or the CBOE.
+
+ The Long Index is calculated according to the following methodology:
+
+ Calculation of the Long Index
+
+ The Long Index measures the daily return from a theoretical portfolio of the two shortest dated VIX monthly futures contracts (m1 and m2) that are rolled daily, such that, the position in the shortest dated VIX monthly futures contract (m1) is rolled into a position in the second shortest dated VIX monthly futures contract (m2) according to the roll schedule resulting from the daily Contract Weight described by 3.
+
+ 
+
+ 31
+
+ Table of Contents
+
+ 
+ Calculation of the Excess Return Index (Index):
+
+ On any business day (t) when the index is calculated, the index value is determined as follows:
+
+ 
+
+ Where:
+
+ Business Day (t) is defined as any day when the CFE market is open.
+
+ = The Index Settlement value on any business day (t) the index is calculated.
+
+ = The Index Settlement value on the preceding business day (t-1).
+
+ = Portfolio Daily Return on any business day (t) is determined as follows:
+
+ 
+
+ Where:
+
+ = Contract Weight and represents the notional dollar weighting of the shortest dated monthly VIX Futures Contract (m1) calculated at the settlement on any business day (t-1) as follows:
+
+ 
+
+ *For clarity, because Contract Weight represents the notional dollar weighting of m1 and m2, the actual number of contracts of m1 and m2 will vary depending on their notional value.
+
+ Where:
+
+ = Roll Days Remaining and is determined each business day as the number of remaining business days within a Roll Period beginning with, and including, the following business day, and ending with, but excluding, the following CBOE VIX monthly Futures Settlement Date (usually a Wednesday). The number of business days does not consider, and therefore continues to include as business days, any new holidays introduced intra-month, or unscheduled market closures.
+ = Roll Days Total and is determined at the beginning of a new Roll Period as the total number of business days within a Roll Period beginning with, and including, the monthly CBOE VIX Futures Settlement Date (usually a Wednesday), and ending with, but excluding, the following CBOE VIX monthly Futures Settlement Date. The number of business days stays constant if a new holiday is introduced intra-month after the CBOE VIX Futures Settlement Date, or in the case of an unscheduled market closure.
+ *For clarity, on each business day a fraction of the theoretical portfolio s m1 VIX futures holding sold and an equal dollar notional amount of the longer dated m2 futures is bought. The fraction rolled each business day is therefore proportional to the number of m1 futures contracts held on business day t1 and inversely proportional to the number of days in the Roll Period RDtot.
+ = Contract Reference Price of the shortest dated monthly VIX Futures Contract (m1) on any business day (t) determined as the average of the 180 last prices for m1 during regular trading and the 180 last Trade At Settlement (TAS) prices for m1 both taken every 5 seconds beginning 14 minutes and 55 seconds before the closing time of the regular trading session on the NYSE and ending at the closing time of the NYSE usually the average of every 5 seconds between 3.45.05 PM ET and 4.00.00 pm ET each business day.
+
+ = Contract Reference Price of the shortest dated monthly VIX Futures Contract (m1) on the previous business day (t-1) determined as the average of the 180 last prices for m1 during regular trading and the 180 last Trade At Settlement (TAS) prices for m1 both taken every 5 seconds beginning 14 minutes and 55 seconds before the closing time of the regular trading session on the NYSE and ending at the closing time of the NYSE usually the average of every 5 seconds between 3.45.05 PM ET and 4.00.00 pm ET each business day.
+ 
+
+ 32
+
+ Table of Contents
+
+ 
+ VIX Futures Contracts
+
+ Each Index is comprised of VIX futures contracts. VIX futures contracts were first launched for trading by the CBOE in 2004. VIX futures contracts allow investors to invest based on their view of the forward implied market volatility of the S&P 500. Investors that believe the forward implied market volatility of the S&P 500 will increase may buy VIX futures contracts. Conversely, investors that believe that the forward implied market volatility of the S&P 500 will decline may sell VIX futures contracts.
+
+ While the VIX represents a measure of the current expected volatility of the S&P 500 over the next 30 days, the prices of VIX futures contracts are based on the current expectation of the expected 30-day volatility of the S&P 500 on the expiration date of the futures contract. Since the VIX and VIX futures contracts are two distinctly different measures, the VIX and VIX futures contracts generally behave quite differently.
+
+ An important consequence of the spot/forward relationship between the VIX and VIX futures contracts (and therefore between the VIX and A Fund) that investors should understand is that the price of a VIX futures contract can be lower, equal to or higher than the VIX, depending on whether the market expects volatility to be lower, equal to or higher in the 30-day forward period covered by the VIX futures contract than in the 30-day spot period covered by the VIX. Therefore the performance of VIX Futures contracts should be expected to be very different than the performance of the VIX as there is no direct relationship between the two measures. As a result, since the performance of a Fund is linked to the performance of the VIX futures contracts included in the Index, a Fund should be expected to perform very differently from the VIX (or -1x or 2x thereof).
+ The VIX
+
+ The VIX is an index designed to measure the implied volatility of the S&P 500 over 30 days in the future. The VIX is calculated based on the prices of certain put and call options on the S&P 500. The VIX is reflective of the premium paid by investors for certain options linked to the level of the S&P 500.
+
+ During periods of rising investor uncertainty, including periods of market instability, the implied level of volatility of the S&P 500 typically increases and, consequently, the prices of options linked to the S&P 500 typically increase (assuming all other relevant factors remain constant or have negligible changes). This, in turn, causes the level of the VIX to increase.
+
+ During periods of declining investor uncertainty, the implied level of volatility of the S&P 500 typically decreases and, consequently, the prices of options linked to the S&P 500 typically decrease (assuming all other relevant factors remain constant or have negligible changes). This, in turn, causes the level of the VIX to decrease.
+
+ Volatility, and the level of the VIX, can increase (or decrease) without warning. The VIX was developed by the CBOE and is calculated, maintained and published by the CBOE. The CBOE may change the methodology used to determine the VIX and has no obligation to continue to publish, and may discontinue the publication of, the VIX. The VIX is reported by Bloomberg Finance L.P. under the ticker symbol VIX. 
+
+ The S&P 500
+
+ The S&P 500 is an index that measures large-cap U.S. stock market performance. It is a float-adjusted market capitalization weighted index of 500 U.S. operating companies and real estate investment trusts selected by the S&P U.S. Index Committee through a non-mechanical process that factors in criteria such as liquidity, price, market capitalization and financial viability. Reconstitution occurs both on a quarterly and ongoing basis. S&P publishes the S&P 500. The daily calculation of the current value of the S&P 500 is based on the relative value of the aggregate market value of the common stocks of 500 companies as of a particular time compared to the aggregate average initial market value of the common stocks of 500 similar companies at the time of the inception of the S&P 500. The 500 companies are not the 500 largest publicly traded companies and not all 500 companies are listed on the Exchange. S&P chooses companies for inclusion in the S&P 500 with the objective of achieving a distribution by broad industry groupings that approximates the distribution of these groupings in the common stock population of the U.S. equity market. S&P may from time to time, in its sole discretion, add companies to, or delete companies from, the S&P 500 to achieve the objectives stated above. Relevant criteria employed by S&P include the viability 
+ 
+
+ 33
+
+ Table of Contents
+
+ 
+ of the particular company, the extent to which that company represents the industry group to which it is assigned, the extent to which the company s common stock is widely held and the market value and trading activity of the common stock of that company.
+
+ Information about the Index Provider
+
+ EACH FUND IS NOT SPONSORED, ENDORSED, SOLD OR PROMOTED BY S&P AND ITS AFFILIATES OR CBOE. S&P AND CBOE MAKE NO REPRESENTATION, CONDITION OR WARRANTY, EXPRESS OR IMPLIED, TO THE OWNERS OF A FUND OR ANY MEMBER OF THE PUBLIC REGARDING THE ADVISABILITY OF INVESTING IN SECURITIES GENERALLY OR IN THE FUND PARTICULARLY OR THE ABILITY OF THE INDEX TO TRACK MARKET PERFORMANCE AND/OR OF GROUPS OF ASSETS OR ASSET CLASSES AND/OR TO ACHIEVE ITS STATED OBJECTIVE AND/OR TO FORM THE BASIS OF A SUCCESSFUL INVESTMENT STRATEGY, AS APPLICABLE. S&P S AND CBOE S ONLY RELATIONSHIP TO VS TRUST ON BEHALF OF ITS APPLICABLE SERIES AND VOLATILITY SHARES LLC IS THE LICENSING OF CERTAIN TRADEMARKS AND TRADE NAMES AND OF EACH INDEX WHICH ARE DETERMINED, COMPOSED AND CALCULATED BY S&P AND CBOE WITHOUT REGARD TO VS TRUST ON BEHALF OF ITS APPLICABLE SERIES AND VOLATILITY SHARES LLC OR THE FUNDS. S&P AND CBOE HAVE NO OBLIGATION TO TAKE THE NEEDS OF VS TRUST ON BEHALF OF ITS APPLICABLE SERIES AND VOLATILITY SHARES LLC OR THE OWNERS OF THE FUNDS INTO CONSIDERATION IN DETERMINING, COMPOSING OR CALCULATING THE INDEX. S&P AND CBOE ARE NOT ADVISORS TO THE FUNDS AND ARE NOT RESPONSIBLE FOR AND HAVE NOT PARTICIPATED IN THE DETERMINATION OF THE PRICES AND AMOUNT OF THE FUNDS OR THE TIMING OF THE ISSUANCE OR SALE OF A FUND OR IN THE DETERMINATION OR CALCULATION OF THE EQUATION BY WHICH FUND SHARES ARE TO BE CONVERTED INTO CASH. S&P AND CBOE HAVE NO OBLIGATION OR LIABILITY IN CONNECTION WITH THE ADMINISTRATION, MARKETING, OR TRADING OF THE FUNDS.
+ NEITHER S&P, ITS AFFILIATES NOR THIRD PARTY LICENSORS, INCLUDING CBOE, GUARANTEES THE ACCURACY AND/OR THE COMPLETENESS OF AN INDEX OR ANY DATA INCLUDED THEREIN AND S&P, ITS AFFILIATES AND THEIR THIRD PARTY LICENSORS, INCLUDING CBOE, SHALL HAVE NO LIABILITY FOR ANY ERRORS, OMISSIONS, OR INTERRUPTIONS THEREIN. S&P AND CBOE MAKE NO WARRANTY, CONDITION OR REPRESENTATION, EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY VS TRUST ON BEHALF OF ITS APPLICABLE SERIES AND VOLATILITY SHARES LLC, SHAREHOLDERS OF THE FUNDS, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF AN INDEX OR ANY DATA INCLUDED THEREIN. S&P AND CBOE MAKE NO EXPRESS OR IMPLIED WARRANTIES, REPRESENTATIONS OR CONDITIONS, AND EXPRESSLY DISCLAIM ALL WARRANTIES OR CONDITIONS OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE AND ANY OTHER EXPRESS OR IMPLIED WARRANTY OR CONDITION WITH RESPECT TO THE INDEX OR ANY DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT SHALL S&P, ITS AFFILIATES OR THEIR THIRD PARTY LICENSORS, INCLUDING CBOE, HAVE ANY LIABILITY FOR ANY SPECIAL, PUNITIVE, INDIRECT, OR CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS) RESULTING FROM THE USE OF THE INDEX OR ANY DATA INCLUDED THEREIN, EVEN IF NOTIFIED OF THE POSSIBILITY OF SUCH DAMAGES.
+ 
+
+ 34
+
+ Table of Contents
+
+ 
+ INVESTMENT OBJECTIVE AND PRINCIPAL INVESTMENT STRATEGY
+
+ Investment Objectives
+
+ SVIX
+
+ SVIX seeks daily investment results, before fees and expenses, that correspond to the performance of the Short Index for a single day. The Fund does not seek to achieve its stated objective over a period greater than a single day. A single day is measured from the time the Fund calculates its NAV to the time of the Fund s next NAV calculation.
+
+ The Index measures the daily inverse performance of a portfolio of first and second month VIX futures contracts. This theoretical portfolio is rolled each day to maintain a consistent time to maturity of the futures contracts. The Index is calculated daily at 4:00 p.m. (Eastern time) and at a value calculated from the average price for the futures contracts between 3:45 p.m. (Eastern time) and 4:00 p.m. (Eastern time). Through this price averaging process known as the Time Weighted Average Price (or TWAP). The Short Index inception date was November 22, 2019. Its ticker symbol is: SHORTVOL. Historical performance of the Short Index and the VIX since the inception of the Short Index through the year ended December 2021 is set forth below: 
+ 
+
+ 
+ 
+
+ Month 
+
+ 
+ 
+ 
+ Short 
+Index 
+
+ 
+ 
+ 
+ VIX 
+
+ 
+ 
+
+ 
+ 
+ December 2019 
+
+ 
+ 
+ 
+ 5.79 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ 9.19 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ January 2020 
+
+ 
+ 
+ 
+ (9.91 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 36.72 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ February 2020 
+
+ 
+ 
+ 
+ (38.62 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 112.90 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ March 2020 
+
+ 
+ 
+ 
+ (68.18 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 33.48 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ April 2020 
+
+ 
+ 
+ 
+ 13.74 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (36.22 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ May 2020 
+
+ 
+ 
+ 
+ 6.82 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (19.44 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ June 2020 
+
+ 
+ 
+ 
+ (15.52 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 10.61 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ July 2020 
+
+ 
+ 
+ 
+ 14.77 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (19.62 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ August 2020 
+
+ 
+ 
+ 
+ 5.82 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ 7.97 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ September 2020 
+
+ 
+ 
+ 
+ 2.06 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (0.15 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ October 2020 
+
+ 
+ 
+ 
+ (11.99 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 44.18 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ November 2020 
+
+ 
+ 
+ 
+ 49.23 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (45.90 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ December 2020 
+
+ 
+ 
+ 
+ 1.27 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ 10.60 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ January 2021 
+
+ 
+ 
+ 
+ (26.02 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 45.45 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ February 2021 
+
+ 
+ 
+ 
+ 24.86 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (15.53 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ March 2021 
+
+ 
+ 
+ 
+ 34.77 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (30.59 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ April 2021 
+
+ 
+ 
+ 
+ 10.93 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (4.07 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ May 2021 
+
+ 
+ 
+ 
+ 6.24 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (9.94 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ June 2021 
+
+ 
+ 
+ 
+ 14.17 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (5.55 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ July 2021 
+
+ 
+ 
+ 
+ (8.16 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 15.22 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ August 2021 
+
+ 
+ 
+ 
+ 15.57 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (9.65 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ September 2021 
+
+ 
+ 
+ 
+ (12.07 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 40.41 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ October 2021 
+
+ 
+ 
+ 
+ 27.60 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (29.73 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+ November 2021 
+
+ 
+ 
+ 
+ (24.77 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ 67.22 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ December 2021 
+
+ 
+ 
+ 
+ 28.75 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ (36.67 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ 
+
+ 35
+
+ Table of Contents
+
+ 
+ If SVIX is successful in meeting its objective, its value on a given day, before fees and expenses, should gain approximately as much on a percentage basis as the level of the Short Index. Conversely, its value on a given day, before fees and expenses, should lose approximately as much on a percentage basis as the level of the Short Index. Although the Fund seeks to track the performance of the Short Index each day, the Fund may not perfectly track the Short Index s performance over the same period, which is known as tracking error. For more information, see Correlation Risk and A number of factors may affect the Fund s ability to produce returns that correlate to the returns of the Short Index.
+ By way of example of the performance of the Short Index relative to the VIX Index, on December 31, 2019, the VIX fell from 14.82 to 13.78 (-7.02%), while the Index that the Fund tracks rose from 1768.43 to 1845.24 (+4.34%)
+
+ UVIX
+
+ UVIX seeks daily investment results, before fees and expenses, that correspond to twice (2x) the performance of the Long Index for a single day. The Fund does not seek to achieve its stated objective over a period greater than a single day. A single day is measured from the time the Fund calculates its NAV to the time of the Fund s next NAV calculation.
+
+ The Long Index measures the daily performance of a portfolio of long positions in first and second month VIX futures contracts. This theoretical portfolio is rolled each day to maintain a consistent time to maturity of the futures contracts. The Index is calculated daily at 4:00 p.m. (Eastern time) and at a value calculated from the average price for the futures contracts between 3:45 p.m. (Eastern time) and 4:00 p.m. (Eastern time). Through this price averaging process known as the Time Weighted Average Price (or TWAP). The Long Index inception date is October 8, 2021. Its ticker symbol is: LONGVOL. Historical performance of the Long Index and the VIX since the inception of the Long Index through the year ended December 2021 is set forth below: 
+ 
+
+ 
+ 
+ Month 
+
+ 
+ 
+ 
+ Long 
+Index 
+
+ 
+ 
+ 
+ VIX 
+
+ 
+ 
+
+ 
+ 
+ November 2021 
+
+ 
+ 
+ 
+ 18.64 
+
+ 
+ 
+ % 
+
+ 
+ 
+ 
+ 67.22 
+
+ 
+ 
+ % 
+
+ 
+ 
+
+ 
+ 
+ December 2021 
+
+ 
+ 
+ 
+ (26.93 
+
+ 
+ 
+ )% 
+
+ 
+ 
+ 
+ (36.67 
+
+ 
+ 
+ )% 
+
+ 
+ 
+
+ 
+ If the Fund is successful in meeting its objective, its value on a given day, before fees and expenses, should gain or lose approximately as much on a percentage basis as twice (2x) the level of the Index. Although the Fund seeks to track twice (2x) the performance of the Index each day, the Fund may not perfectly achieve its objective over the same period, which is known as tracking error. For more information, see Correlation Risk on page 10.
+
+ The Fund is not designed to meet its investment objective over periods longer than one day. Notwithstanding, the table below shows a performance example of the how compounding impacts a 2x daily rebalanced investment referencing an index over periods longer than one day. Areas shaded lighter represent those scenarios where a hypothetical fund that seeks 2x daily returns of an index will return the same or outperform (i.e., return more than) 2x of the index performance; conversely, areas shaded darker represent those scenarios where the hypothetical fund will underperform (i.e., return less than) 2x of the index performance.
+
+ Performance Examples
+
+ The tables below show performance examples of the how compounding impacts: i) an inverse daily rebalanced investment that references an index over periods longer than one day (Figure 1); and ii) a 2x daily rebalanced investment referencing an index over periods longer than one day (Figure 2). Areas shaded lighter represent those scenarios where a hypothetical fund that seeks daily inverse or daily 2x returns of an index will return the same or outperform (i.e., return more than) the inverse or 2x of the index performance over one year; conversely, areas shaded darker represent those scenarios where the hypothetical fund will underperform (i.e., return less than) the inverse or 2x of the index performance over one year.
+ 
+
+ 36
+
+ Table of Contents
+
+ 
+ Figure 1.
+
+ 
+
+ 
+ 
+
+ One Year Index 
+Performance
+
+ 
+ 
+ Inverse (-1x) of 
+One Year Index 
+Performance
+
+ 
+ 
+ 
+Index Votatility
+
+ 
+ 
+
+ 
+ 
+ 0%
+
+ 
+ 
+ 5%
+
+ 
+ 
+ 10%
+
+ 
+ 
+ 15%
+
+ 
+ 
+ 20%
+
+ 
+ 
+ 25%
+
+ 
+ 
+ 30%
+
+ 
+ 
+ 35%
+
+ 
+ 
+ 40%
+
+ 
+ 
+ 45%
+
+ 
+ 
+ 50%
+
+ 
+ 
+ 55%
+
+ 
+ 
+ 60%
+
+ 
+ 
+
+ 
+ 
+ (60)%
+
+ 
+ 
+ 60%
+
+ 
+ 
+ 150.0%
+
+ 
+ 
+ 149.4%
+
+ 
+ 
+ 147.5%
+
+ 
+ 
+ 144.4%
+
+ 
+ 
+ 140.2%
+
+ 
+ 
+ 134.9%
+
+ 
+ 
+ 128.5%
+
+ 
+ 
+ 121.2%
+
+ 
+ 
+ 113.0%
+
+ 
+ 
+ 104.2%
+
+ 
+ 
+ 94.7%
+
+ 
+ 
+ 84.7%
+
+ 
+ 
+ 74.4%
+
+ 
+ 
+
+ 
+ 
+ (55)%
+
+ 
+ 
+ 55%
+
+ 
+ 
+ 122.2%
+
+ 
+ 
+ 121.7%
+
+ 
+ 
+ 120.0%
+
+ 
+ 
+ 117.3%
+
+ 
+ 
+ 113.5%
+
+ 
+ 
+ 108.8%
+
+ 
+ 
+ 103.1%
+
+ 
+ 
+ 96.6%
+
+ 
+ 
+ 89.4%
+
+ 
+ 
+ 81.5%
+
+ 
+ 
+ 73.1%
+
+ 
+ 
+ 64.2%
+
+ 
+ 
+ 55.0%
+
+ 
+ 
+
+ 
+ 
+ (50)%
+
+ 
+ 
+ 50%
+
+ 
+ 
+ 100.0%
+
+ 
+ 
+ 99.5%
+
+ 
+ 
+ 98.0%
+
+ 
+ 
+ 95.6%
+
+ 
+ 
+ 92.2%
+
+ 
+ 
+ 87.9%
+
+ 
+ 
+ 82.8%
+
+ 
+ 
+ 76.9%
+
+ 
+ 
+ 70.4%
+
+ 
+ 
+ 63.3%
+
+ 
+ 
+ 55.8%
+
+ 
+ 
+ 47.8%
+
+ 
+ 
+ 39.5%
+
+ 
+ 
+
+ 
+ 
+ (45)%
+
+ 
+ 
+ 45%
+
+ 
+ 
+ 81.8%
+
+ 
+ 
+ 81.4%
+
+ 
+ 
+ 80.0%
+
+ 
+ 
+ 77.8%
+
+ 
+ 
+ 74.7%
+
+ 
+ 
+ 70.8%
+
+ 
+ 
+ 66.2%
+
+ 
+ 
+ 60.9%
+
+ 
+ 
+ 54.9%
+
+ 
+ 
+ 48.5%
+
+ 
+ 
+ 41.6%
+
+ 
+ 
+ 34.4%
+
+ 
+ 
+ 26.9%
+
+ 
+ 
+
+ 
+ 
+ (40)%
+
+ 
+ 
+ 40%
+
+ 
+ 
+ 66.7%
+
+ 
+ 
+ 66.3%
+
+ 
+ 
+ 65.0%
+
+ 
+ 
+ 63.0%
+
+ 
+ 
+ 60.1%
+
+ 
+ 
+ 56.6%
+
+ 
+ 
+ 52.3%
+
+ 
+ 
+ 47.5%
+
+ 
+ 
+ 42.0%
+
+ 
+ 
+ 36.1%
+
+ 
+ 
+ 29.8%
+
+ 
+ 
+ 23.2%
+
+ 
+ 
+ 16.3%
+
+ 
+ 
+
+ 
+ 
+ (35)%
+
+ 
+ 
+ 35%
+
+ 
+ 
+ 53.8%
+
+ 
+ 
+ 53.5%
+
+ 
+ 
+ 52.3%
+
+ 
+ 
+ 50.4%
+
+ 
+ 
+ 47.8%
+
+ 
+ 
+ 44.5%
+
+ 
+ 
+ 40.6%
+
+ 
+ 
+ 36.1%
+
+ 
+ 
+ 31.1%
+
+ 
+ 
+ 25.6%
+
+ 
+ 
+ 19.8%
+
+ 
+ 
+ 13.7%
+
+ 
+ 
+ 7.3%
+
+ 
+ 
+
+ 
+ 
+ (30)%
+
+ 
+ 
+ 30%
+
+ 
+ 
+ 42.9%
+
+ 
+ 
+ 42.5%
+
+ 
+ 
+ 41.4%
+
+ 
+ 
+ 39.7%
+
+ 
+ 
+ 37.3%
+
+ 
+ 
+ 34.2%
+
+ 
+ 
+ 30.6%
+
+ 
+ 
+ 26.4%
+
+ 
+ 
+ 21.7%
+
+ 
+ 
+ 16.7%
+
+ 
+ 
+ 11.3%
+
+ 
+ 
+ 5.6%
+
+ 
+ 
+ (0.3)%
+
+ 
+ 
+
+ 
+ 
+ (25)%
+
+ 
+ 
+ 25%
+
+ 
+ 
+ 33.3%
+
+ 
+ 
+ 33.0%
+
+ 
+ 
+ 32.0%
+
+ 
+ 
+ 30.4%
+
+ 
+ 
+ 28.1%
+
+ 
+ 
+ 25.3%
+
+ 
+ 
+ 21.9%
+
+ 
+ 
+ 18.0%
+
+ 
+ 
+ 13.6%
+
+ 
+ 
+ 8.9%
+
+ 
+ 
+ 3.8%
+
+ 
+ 
+ (1.5)%
+
+ 
+ 
+ (7.0)%
+
+ 
+ 
+
+ 
+ 
+ (20)%
+
+ 
+ 
+ 20%
+
+ 
+ 
+ 25.0%
+
+ 
+ 
+ 24.7%
+
+ 
+ 
+ 23.8%
+
+ 
+ 
+ 22.2%
+
+ 
+ 
+ 20.1%
+
+ 
+ 
+ 17.4%
+
+ 
+ 
+ 14.2%
+
+ 
+ 
+ 10.6%
+
+ 
+ 
+ 6.5%
+
+ 
+ 
+ 2.1%
+
+ 
+ 
+ (2.6)%
+
+ 
+ 
+ (7.6)%
+
+ 
+ 
+ (12.8)%
+
+ 
+ 
+
+ 
+ 
+ (15)%
+
+ 
+ 
+ 15%
+
+ 
+ 
+ 17.6%
+
+ 
+ 
+ 17.4%
+
+ 
+ 
+ 16.5%
+
+ 
+ 
+ 15.0%
+
+ 
+ 
+ 13.0%
+
+ 
+ 
+ 10.5%
+
+ 
+ 
+ 7.5%
+
+ 
+ 
+ 4.1%
+
+ 
+ 
+ 0.3%
+
+ 
+ 
+ (3.9)%
+
+ 
+ 
+ (8.4)%
+
+ 
+ 
+ (13.1)%
+
+ 
+ 
+ (17.9)%
+
+ 
+ 
+
+ 
+ 
+ (10)%
+
+ 
+ 
+ 10%
+
+ 
+ 
+ 11.1%
+
+ 
+ 
+ 10.8%
+
+ 
+ 
+ 10.0%
+
+ 
+ 
+ 8.6%
+
+ 
+ 
+ 6.8%
+
+ 
+ 
+ 4.4%
+
+ 
+ 
+ 1.5%
+
+ 
+ 
+ (1.7)%
+
+ 
+ 
+ (5.3)%
+
+ 
+ 
+ (9.3)%
+
+ 
+ 
+ (13.5)%
+
+ 
+ 
+ (17.9)%
+
+ 
+ 
+ (22.5)%
+
+ 
+ 
+
+ 
+ 
+ (5)%
+
+ 
+ 
+ 5%
+
+ 
+ 
+ 5.3%
+
+ 
+ 
+ 5.0%
+
+ 
+ 
+ 4.2%
+
+ 
+ 
+ 2.9%
+
+ 
+ 
+ 1.1%
+
+ 
+ 
+ (1.1)%
+
+ 
+ 
+ (3.8)%
+
+ 
+ 
+ (6.9)%
+
+ 
+ 
+ (10.3)%
+
+ 
+ 
+ (14.0)%
+
+ 
+ 
+ (18.0)%
+
+ 
+ 
+ (22.2)%
+
+ 
+ 
+ (26.6)%
+
+ 
+ 
+
+ 
+ 
+ 0%
+
+ 
+ 
+ 0%
+
+ 
+ 
+ 0.0%
+
+ 
+ 
+ (0.2)%
+
+ 
+ 
+ (1.0)%
+
+ 
+ 
+ (2.2)%
+
+ 
+ 
+ (3.9)%
+
+ 
+ 
+ (6.1)%
+
+ 
+ 
+ (8.6)%
+
+ 
+ 
+ (11.5)%
+
+ 
+ 
+ (14.8)%
+
+ 
+ 
+ (18.3)%
+
+ 
+ 
+ (22.1)%
+
+ 
+ 
+ (26.1)%
+
+ 
+ 
+ (30.2)%
+
+ 
+ 
+
+ 
+ 
+ 5%
+
+ 
+ 
+ (5)%
+
+ 
+ 
+ (4.8)%
+
+ 
+ 
+ (5.0)%
+
+ 
+ 
+ (5.7)%
+
+ 
+ 
+ (6.9)%
+
+ 
+ 
+ (8.5)%
+
+ 
+ 
+ (10.5)%
+
+ 
+ 
+ (13.0)%
+
+ 
+ 
+ (15.7)%
+
+ 
+ 
+ (18.8)%
+
+ 
+ 
+ (22.2)%
+
+ 
+ 
+ (25.8)%
+
+ 
+ 
+ (29.6)%
+
+ 
+ 
+ (33.6)%
+
+ 
+ 
+
+ 
+ 
+ 10%
+
+ 
+ 
+ (10)%
+
+ 
+ 
+ (9.1)%
+
+ 
+ 
+ (9.3)%
+
+ 
+ 
+ (10.0)%
+
+ 
+ 
+ (11.1)%
+
+ 
+ 
+ (12.7)%
+
+ 
+ 
+ (14.6)%
+
+ 
+ 
+ (16.9)%
+
+ 
+ 
+ (19.6)%
+
+ 
+ 
+ (22.5)%
+
+ 
+ 
+ (25.8)%
+
+ 
+ 
+ (29.2)%
+
+ 
+ 
+ (32.8)%
+
+ 
+ 
+ (36.6)%
+
+ 
+ 
+
+ 
+ 
+ 15%
+
+ 
+ 
+ (15)%
+
+ 
+ 
+ (13.0)%
+
+ 
+ 
+ (13.3)%
+
+ 
+ 
+ (13.9)%
+
+ 
+ 
+ (15.0)%
+
+ 
+ 
+ (16.5)%
+
+ 
+ 
+ (18.3)%
+
+ 
+ 
+ (20.5)%
+
+ 
+ 
+ (23.1)%
+
+ 
+ 
+ (25.9)%
+
+ 
+ 
+ (29.0)%
+
+ 
+ 
+ (32.3)%
+
+ 
+ 
+ (35.7)%
+
+ 
+ 
+ (39.3)%
+
+ 
+ 
+
+ 
+ 
+ 20%
+
+ 
+ 
+ (20)%
+
+ 
+ 
+ (16.7)%
+
+ 
+ 
+ (16.9)%
+
+ 
+ 
+ (17.5)%
+
+ 
+ 
+ (18.5)%
+
+ 
+ 
+ (19.9)%
+
+ 
+ 
+ (21.7)%
+
+ 
+ 
+ (23.8)%
+
+ 
+ 
+ (26.3)%
+
+ 
+ 
+ (29.0)%
+
+ 
+ 
+ (31.9)%
+
+ 
+ 
+ (35.1)%
+
+ 
+ 
+ (38.4)%
+
+ 
+ 
+ (41.9)%
+
+ 
+ 
+
+ 
+ 
+ 25%
+
+ 
+ 
+ (25)%
+
+ 
+ 
+ (20.0)%
+
+ 
+ 
+ (20.2)%
+
+ 
+ 
+ (20.8)%
+
+ 
+ 
+ (21.8)%
+
+ 
+ 
+ (23.1)%
+
+ 
+ 
+ (24.8)%
+
+ 
+ 
+ (26.9)%
+
+ 
+ 
+ (29.2)%
+
+ 
+ 
+ (31.8)%
+
+ 
+ 
+ (34.7)%
+
+ 
+ 
+ (37.7)%
+
+ 
+ 
+ (40.9)%
+
+ 
+ 
+ (44.2)%
+
+ 
+ 
+
+ 
+ 
+ 30%
+
+ 
+ 
+ (30)%
+
+ 
+ 
+ (23.1)%
+
+ 
+ 
+ (23.3)%
+
+ 
+ 
+ (23.8)%
+
+ 
+ 
+ (24.8)%
+
+ 
+ 
+ (26.1)%
+
+ 
+ 
+ (27.7)%
+
+ 
+ 
+ (29.7)%
+
+ 
+ 
+ (31.9)%
+
+ 
+ 
+ (34.5)%
+
+ 
+ 
+ (37.2)%
+
+ 
+ 
+ (40.1)%
+
+ 
+ 
+ (43.2)%
+
+ 
+ 
+ (46.3)%
+
+ 
+ 
+
+ 
+ 
+ 35%
+
+ 
+ 
+ (35)%
+
+ 
+ 
+ (25.9)%
+
+ 
+ 
+ (26.1)%
+
+ 
+ 
+ (26.7)%
+
+ 
+ 
+ (27.6)%
+
+ 
+ 
+ (28.8)%
+
+ 
+ 
+ (30.4)%
+
+ 
+ 
+ (32.3)%
+
+ 
+ 
+ (34.5)%
+
+ 
+ 
+ (36.9)%
+
+ 
+ 
+ (39.5)%
+
+ 
+ 
+ (42.3)%
+
+ 
+ 
+ (45.3)%
+
+ 
+ 
+ (48.3)%
+
+ 
+ 
+
+ 
+ 
+ 40%
+
+ 
+ 
+ (40)%
+
+ 
+ 
+ (28.6)%
+
+ 
+ 
+ (28.7)%
+
+ 
+ 
+ (29.3)%
+
+ 
+ 
+ (30.2)%
+
+ 
+ 
+ (31.4)%
+
+ 
+ 
+ (32.9)%
+
+ 
+ 
+ (34.7)%
+
+ 
+ 
+ (36.8)%
+
+ 
+ 
+ (39.1)%
+
+ 
+ 
+ (41.7)%
+
+ 
+ 
+ (44.4)%
+
+ 
+ 
+ (47.2)%
+
+ 
+ 
+ (50.2)%
+
+ 
+ 
+
+ 
+ 
+ 45%
+
+ 
+ 
+ (45)%
+
+ 
+ 
+ (31.0)%
+
+ 
+ 
+ (31.2)%
+
+ 
+ 
+ (31.7)%
+
+ 
+ 
+ (32.6)%
+
+ 
+ 
+ (33.7)%
+
+ 
+ 
+ (35.2)%
+
+ 
+ 
+ (37.0)%
+
+ 
+ 
+ (39.0)%
+
+ 
+ 
+ (41.2)%
+
+ 
+ 
+ (43.7)%
+
+ 
+ 
+ (46.3)%
+
+ 
+ 
+ (49.0)%
+
+ 
+ 
+ (51.9)%
+
+ 
+ 
+
+ 
+ 
+ 50%
+
+ 
+ 
+ (50)%
+
+ 
+ 
+ (33.3)%
+
+ 
+ 
+ (33.5)%
+
+ 
+ 
+ (34.0)%
+
+ 
+ 
+ (34.8)%
+
+ 
+ 
+ (35.9)%
+
+ 
+ 
+ (37.4)%
+
+ 
+ 
+ (39.1)%
+
+ 
+ 
+ (41.0)%
+
+ 
+ 
+ (43.2)%
+
+ 
+ 
+ (45.6)%
+
+ 
+ 
+ (48.1)%
+
+ 
+ 
+ (50.7)%
+
+ 
+ 
+ (53.5)%
+
+ 
+ 
+
+ 
+ 
+ 55%
+
+ 
+ 
+ (55)%
+
+ 
+ 
+ (35.5)%
+
+ 
+ 
+ (35.6)%
+
+ 
+ 
+ (36.1)%
+
+ 
+ 
+ (36.9)%
+
+ 
+ 
+ (38.0)%
+
+ 
+ 
+ (39.4)%
+
+ 
+ 
+ (41.0)%
+
+ 
+ 
+ (42.9)%
+
+ 
+ 
+ (45.0)%
+
+ 
+ 
+ (47.3)%
+
+ 
+ 
+ (49.8)%
+
+ 
+ 
+ (52.3)%
+
+ 
+ 
+ (55.0)%
+
+ 
+ 
+
+ 
+ 
+ 60%
+
+ 
+ 
+ (60)%
+
+ 
+ 
+ (37.5)%
+
+ 
+ 
+ (37.7)%
+
+ 
+ 
+ (38.1)%
+
+ 
+ 
+ (38.9)%
+
+ 
+ 
+ (40.0)%
+
+ 
+ 
+ (41.3)%
+
+ 
+ 
+ (42.9)%
+
+ 
+ 
+ (44.7)%
+
+ 
+ 
+ (46.7)%
+
+ 
+ 
+ (49.0)%
+
+ 
+ 
+ (51.3)%
+
+ 
+ 
+ (53.8)%
+
+ 
+ 
+ (56.4)%
+
+ 
+ 
+
+ 
+ Figure 2.
+
+ 
+
+ 
+ 
+
+ One Year Index 
+Performance
+
+ 
+ 
+ Inverse (2x) 
+One Year Index 
+Performance
+
+ 
+ 
+ 
+Index Votatility
+
+ 
+ 
+
+ 
+ 
+ 0%
+
+ 
+ 
+ 5%
+
+ 
+ 
+ 10%
+
+ 
+ 
+ 15%
+
+ 
+ 
+ 20%
+
+ 
+ 
+ 25%
+
+ 
+ 
+ 30%
+
+ 
+ 
+ 35%
+
+ 
+ 
+ 40%
+
+ 
+ 
+ 45%
+
+ 
+ 
+ 50%
+
+ 
+ 
+ 55%
+
+ 
+ 
+ 60%
+
+ 
+ 
+
+ 
+ 
+ (60)%
+
+ 
+ 
+ (120)%
+
+ 
+ 
+ (84.0)%
+
+ 
+ 
+ (84.0)%
+
+ 
+ 
+ (84.2)%
+
+ 
+ 
+ (84.4)%
+
+ 
+ 
+ (84.6)%
+
+ 
+ 
+ (85.0)%
+
+ 
+ 
+ (85.4)%
+
+ 
+ 
+ (85.8)%
+
+ 
+ 
+ (86.4)%
+
+ 
+ 
+ (86.9)%
+
+ 
+ 
+ (87.5)%
+
+ 
+ 
+ (88.2)%
+
+ 
+ 
+ (88.8)%
+
+ 
+ 
+
+ 
+ 
+ (55)%
+
+ 
+ 
+ (110)%
+
+ 
+ 
+ (79.8)%
+
+ 
+ 
+ (79.8)%
+
+ 
+ 
+ (80.0)%
+
+ 
+ 
+ (80.2)%
+
+ 
+ 
+ (80.5)%
+
+ 
+ 
+ (81.0)%
+
+ 
+ 
+ (81.5)%
+
+ 
+ 
+ (82.1)%
+
+ 
+ 
+ (82.7)%
+
+ 
+ 
+ (83.5)%
+
+ 
+ 
+ (84.2)%
+
+ 
+ 
+ (85.0)%
+
+ 
+ 
+ (85.9)%
+
+ 
+ 
+
+ 
+ 
+ (50)%
+
+ 
+ 
+ (100)%
+
+ 
+ 
+ (75.0)%
+
+ 
+ 
+ (75.1)%
+
+ 
+ 
+ (75.2)%
+
+ 
+ 
+ (75.6)%
+
+ 
+ 
+ (76.0)%
+
+ 
+ 
+ (76.5)%
+
+ 
+ 
+ (77.2)%
+
+ 
+ 
+ (77.9)%
+
+ 
+ 
+ (78.7)%
+
+ 
+ 
+ (79.6)%
+
+ 
+ 
+ (80.5)%
+
+ 
+ 
+ (81.5)%
+
+ 
+ 
+ (82.6)%
+
+ 
+ 
+
+ 
+ 
+ (45)%
+
+ 
+ 
+ (90)%
+
+ 
+ 
+ (69.8)%
+
+ 
+ 
+ (69.8)%
+
+ 
+ 
+ (70.1)%
+
+ 
+ 
+ (70.4)%
+
+ 
+ 
+ (70.9)%
+
+ 
+ 
+ (71.6)%
+
+ 
+ 
+ (72.4)%
+
+ 
+ 
+ (73.2)%
+
+ 
+ 
+ (74.2)%
+
+ 
+ 
+ (75.3)%
+
+ 
+ 
+ (76.4)%
+
+ 
+ 
+ (77.6)%
+
+ 
+ 
+ (78.9)%
+
+ 
+ 
+
+ 
+ 
+ (40)%
+
+ 
+ 
+ (80)%
+
+ 
+ 
+ (64.0)%
+
+ 
+ 
+ (64.1)%
+
+ 
+ 
+ (64.4)%
+
+ 
+ 
+ (64.8)%
+
+ 
+ 
+ (65.4)%
+
+ 
+ 
+ (66.2)%
+
+ 
+ 
+ (67.1)%
+
+ 
+ 
+ (68.2)%
+
+ 
+ 
+ (69.3)%
+
+ 
+ 
+ (70.6)%
+
+ 
+ 
+ (72.0)%
+
+ 
+ 
+ (73.4)%
+
+ 
+ 
+ (74.9)%
+
+ 
+ 
+
+ 
+ 
+ (35)%
+
+ 
+ 
+ (70)%
+
+ 
+ 
+ (57.8)%
+
+ 
+ 
+ (57.9)%
+
+ 
+ 
+ (58.2)%
+
+ 
+ 
+ (58.7)%
+
+ 
+ 
+ (59.4)%
+
+ 
+ 
+ (60.3)%
+
+ 
+ 
+ (61.4)%
+
+ 
+ 
+ (62.6)%
+
+ 
+ 
+ (64.0)%
+
+ 
+ 
+ (65.5)%
+
+ 
+ 
+ (67.1)%
+
+ 
+ 
+ (68.8)%
+
+ 
+ 
+ (70.5)%
+
+ 
+ 
+
+ 
+ 
+ (30)%
+
+ 
+ 
+ (60)%
+
+ 
+ 
+ (51.0)%
+
+ 
+ 
+ (51.1)%
+
+ 
+ 
+ (51.5)%
+
+ 
+ 
+ (52.1)%
+
+ 
+ 
+ (52.9)%
+
+ 
+ 
+ (54.0)%
+
+ 
+ 
+ (55.2)%
+
+ 
+ 
+ (56.6)%
+
+ 
+ 
+ (58.2)%
+
+ 
+ 
+ (60.0)%
+
+ 
+ 
+ (61.8)%
+
+ 
+ 
+ (63.8)%
+
+ 
+ 
+ (65.8)%
+
+ 
+ 
+
+ 
+ 
+ (25)%
+
+ 
+ 
+ (50)%
+
+ 
+ 
+ (43.8)%
+
+ 
+ 
+ (43.9)%
+
+ 
+ 
+ (44.3)%
+
+ 
+ 
+ (45.0)%
+
+ 
+ 
+ (46.0)%
+
+ 
+ 
+ (47.2)%
+
+ 
+ 
+ (48.6)%
+
+ 
+ 
+ (50.2)%
+
+ 
+ 
+ (52.1)%
+
+ 
+ 
+ (54.1)%
+
+ 
+ 
+ (56.2)%
+
+ 
+ 
+ (58.4)%
+
+ 
+ 
+ (60.8)%
+
+ 
+ 
+
+ 
+ 
+ (20)%
+
+ 
+ 
+ (40)%
+
+ 
+ 
+ (36.0)%
+
+ 
+ 
+ (36.2)%
+
+ 
+ 
+ (36.6)%
+
+ 
+ 
+ (37.4)%
+
+ 
+ 
+ (38.5)%
+
+ 
+ 
+ (39.9)%
+
+ 
+ 
+ (41.5)%
+
+ 
+ 
+ (43.4)%
+
+ 
+ 
+ (45.5)%
+
+ 
+ 
+ (47.7)%
+
+ 
+ 
+ (50.2)%
+
+ 
+ 
+ (52.7)%
+
+ 
+ 
+ (55.3)%
+
+ 
+ 
+
+ 
+ 
+ (15)%
+
+ 
+ 
+ (30)%
+
+ 
+ 
+ (27.8)%
+
+ 
+ 
+ (27.9)%
+
+ 
+ 
+ (28.5)%
+
+ 
+ 
+ (29.4)%
+
+ 
+ 
+ (30.6)%
+
+ 
+ 
+ (32.1)%
+
+ 
+ 
+ (34.0)%
+
+ 
+ 
+ (36.1)%
+
+ 
+ 
+ (38.4)%
+
+ 
+ 
+ (41.0)%
+
+ 
+ 
+ (43.7)%
+
+ 
+ 
+ (46.6)%
+
+ 
+ 
+ (49.6)%
+
+ 
+ 
+
+ 
+ 
+ (10)%
+
+ 
+ 
+ (20)%
+
+ 
+ 
+ (19.0)%
+
+ 
+ 
+ (19.2)%
+
+ 
+ 
+ (19.8)%
+
+ 
+ 
+ (20.8)%
+
+ 
+ 
+ (22.2)%
+
+ 
+ 
+ (23.9)%
+
+ 
+ 
+ (26.0)%
+
+ 
+ 
+ (28.3)%
+
+ 
+ 
+ (31.0)%
+
+ 
+ 
+ (33.8)%
+
+ 
+ 
+ (36.9)%
+
+ 
+ 
+ (40.1)%
+
+ 
+ 
+ (43.5)%
+
+ 
+ 
+
+ 
+ 
+ (5)%
+
+ 
+ 
+ (10)%
+
+ 
+ 
+ (9.8)%
+
+ 
+ 
+ (10.0)%
+
+ 
+ 
+ (10.6)%
+
+ 
+ 
+ (11.8)%
+
+ 
+ 
+ (13.3)%
+
+ 
+ 
+ (15.2)%
+
+ 
+ 
+ (17.5)%
+
+ 
+ 
+ (20.2)%
+
+ 
+ 
+ (23.1)%
+
+ 
+ 
+ (26.3)%
+
+ 
+ 
+ (29.7)%
+
+ 
+ 
+ (33.3)%
+
+ 
+ 
+ (37.0)%
+
+ 
+ 
+
+ 
+ 
+ 0%
+
+ 
+ 
+ 0%
+
+ 
+ 
+ 0.0%
+
+ 
+ 
+ (0.2)%
+
+ 
+ 
+ (1.0)%
+
+ 
+ 
+ (2.2)%
+
+ 
+ 
+ (3.9)%
+
+ 
+ 
+ (6.1)%
+
+ 
+ 
+ (8.6)%
+
+ 
+ 
+ (11.5)%
+
+ 
+ 
+ (14.8)%
+
+ 
+ 
+ (18.3)%
+
+ 
+ 
+ (22.1)%
+
+ 
+ 
+ (26.1)%
+
+ 
+ 
+ (30.2)%
+
+ 
+ 
+
+ 
+ 
+ 5%
+
+ 
+ 
+ 10%
+
+ 
+ 
+ 10.3%
+
+ 
+ 
+ 10.0%
+
+ 
+ 
+ 9.2%
+
+ 
+ 
+ 7.8%
+
+ 
+ 
+ 5.9%
+
+ 
+ 
+ 3.6%
+
+ 
+ 
+ 0.8%
+
+ 
+ 
+ (2.5)%
+
+ 
+ 
+ (6.1)%
+
+ 
+ 
+ (10.0)%
+
+ 
+ 
+ (14.1)%
+
+ 
+ 
+ (18.5)%
+
+ 
+ 
+ (23.1)%
+
+ 
+ 
+
+ 
+ 
+ 10%
+
+ 
+ 
+ 20%
+
+ 
+ 
+ 21.0%
+
+ 
+ 
+ 20.7%
+
+ 
+ 
+ 19.8%
+
+ 
+ 
+ 18.3%
+
+ 
+ 
+ 16.3%
+
+ 
+ 
+ 13.7%
+
+ 
+ 
+ 10.6%
+
+ 
+ 
+ 7.0%
+
+ 
+ 
+ 3.1%
+
+ 
+ 
+ (1.2)%
+
+ 
+ 
+ (5.8)%
+
+ 
+ 
+ (10.6)%
+
+ 
+ 
+ (15.6)%
+
+ 
+ 
+
+ 
+ 
+ 15%
+
+ 
+ 
+ 30%
+
+ 
+ 
+ 32.3%
+
+ 
+ 
+ 31.9%
+
+ 
+ 
+ 30.9%
+
+ 
+ 
+ 29.3%
+
+ 
+ 
+ 27.1%
+
+ 
+ 
+ 24.2%
+
+ 
+ 
+ 20.9%
+
+ 
+ 
+ 17.0%
+
+ 
+ 
+ 12.7%
+
+ 
+ 
+ 8.0%
+
+ 
+ 
+ 3.0%
+
+ 
+ 
+ (2.3)%
+
+ 
+ 
+ (7.7)%
+
+ 
+ 
+
+ 
+ 
+ 20%
+
+ 
+ 
+ 40%
+
+ 
+ 
+ 44.0%
+
+ 
+ 
+ 43.6%
+
+ 
+ 
+ 42.6%
+
+ 
+ 
+ 40.8%
+
+ 
+ 
+ 38.4%
+
+ 
+ 
+ 35.3%
+
+ 
+ 
+ 31.6%
+
+ 
+ 
+ 27.4%
+
+ 
+ 
+ 22.7%
+
+ 
+ 
+ 17.6%
+
+ 
+ 
+ 12.1%
+
+ 
+ 
+ 6.4%
+
+ 
+ 
+ 0.5%
+
+ 
+ 
+
+ 
+ 
+ 25%
+
+ 
+ 
+ 50%
+
+ 
+ 
+ 56.3%
+
+ 
+ 
+ 55.9%
+
+ 
+ 
+ 54.7%
+
+ 
+ 
+ 52.8%
+
+ 
+ 
+ 50.1%
+
+ 
+ 
+ 46.8%
+
+ 
+ 
+ 42.8%
+
+ 
+ 
+ 38.2%
+
+ 
+ 
+ 33.1%
+
+ 
+ 
+ 27.6%
+
+ 
+ 
+ 21.7%
+
+ 
+ 
+ 15.5%
+
+ 
+ 
+ 9.0%
+
+ 
+ 
+
+ 
+ 
+ 30%
+
+ 
+ 
+ 60%
+
+ 
+ 
+ 69.0%
+
+ 
+ 
+ 68.6%
+
+ 
+ 
+ 67.3%
+
+ 
+ 
+ 65.2%
+
+ 
+ 
+ 62.4%
+
+ 
+ 
+ 58.8%
+
+ 
+ 
+ 54.5%
+
+ 
+ 
+ 49.5%
+
+ 
+ 
+ 44.0%
+
+ 
+ 
+ 38.0%
+
+ 
+ 
+ 31.6%
+
+ 
+ 
+ 24.9%
+
+ 
+ 
+ 17.9%
+
+ 
+ 
+
+ 
+ 
+ 35%
+
+ 
+ 
+ 70%
+
+ 
+ 
+ 82.3%
+
+ 
+ 
+ 81.8%
+
+ 
+ 
+ 80.4%
+
+ 
+ 
+ 78.2%
+
+ 
+ 
+ 75.1%
+
+ 
+ 
+ 71.2%
+
+ 
+ 
+ 66.6%
+
+ 
+ 
+ 61.2%
+
+ 
+ 
+ 55.3%
+
+ 
+ 
+ 48.8%
+
+ 
+ 
+ 41.9%
+
+ 
+ 
+ 34.7%
+
+ 
+ 
+ 27.2%
+
+ 
+ 
+
+ 
+ 
+ 40%
+
+ 
+ 
+ 80%
+
+ 
+ 
+ 96.0%
+
+ 
+ 
+ 95.5%
+
+ 
+ 
+ 94.0%
+
+ 
+ 
+ 91.6%
+
+ 
+ 
+ 88.3%
+
+ 
+ 
+ 84.1%
+
+ 
+ 
+ 79.1%
+
+ 
+ 
+ 73.4%
+
+ 
+ 
+ 67.0%
+
+ 
+ 
+ 60.1%
+
+ 
+ 
+ 52.6%
+
+ 
+ 
+ 44.8%
+
+ 
+ 
+ 36.7%
+
+ 
+ 
+
+ 
+ 
+ 45%
+
+ 
+ 
+ 90%
+
+ 
+ 
+ 110.3%
+
+ 
+ 
+ 109.7%
+
+ 
+ 
+ 108.2%
+
+ 
+ 
+ 105.6%
+
+ 
+ 
+ 102.0%
+
+ 
+ 
+ 97.5%
+
+ 
+ 
+ 92.2%
+
+ 
+ 
+ 86.0%
+
+ 
+ 
+ 79.2%
+
+ 
+ 
+ 71.7%
+
+ 
+ 
+ 63.7%
+
+ 
+ 
+ 55.4%
+
+ 
+ 
+ 46.7%
+
+ 
+ 
+
+ 
+ 
+ 50%
+
+ 
+ 
+ 100%
+
+ 
+ 
+ 125.0%
+
+ 
+ 
+ 124.4%
+
+ 
+ 
+ 122.8%
+
+ 
+ 
+ 120.0%
+
+ 
+ 
+ 116.2%
+
+ 
+ 
+ 111.4%
+
+ 
+ 
+ 105.6%
+
+ 
+ 
+ 99.1%
+
+ 
+ 
+ 91.7%
+
+ 
+ 
+ 83.8%
+
+ 
+ 
+ 75.2%
+
+ 
+ 
+ 66.3%
+
+ 
+ 
+ 57.0%
+
+ 
+ 
+
+ 
+ 
+ 55%
+
+ 
+ 
+ 110%
+
+ 
+ 
+ 140.3%
+
+ 
+ 
+ 139.7%
+
+ 
+ 
+ 137.9%
+
+ 
+ 
+ 134.9%
+
+ 
+ 
+ 130.8%
+
+ 
+ 
+ 125.7%
+
+ 
+ 
+ 119.6%
+
+ 
+ 
+ 112.6%
+
+ 
+ 
+ 104.7%
+
+ 
+ 
+ 96.2%
+
+ 
+ 
+ 87.1%
+
+ 
+ 
+ 77.5%
+
+ 
+ 
+ 67.6%
+
+ 
+ 
+
+ 
+ 
+ 60%
+
+ 
+ 
+ 120%
+
+ 
+ 
+ 156.0%
+
+ 
+ 
+ 155.4%
+
+ 
+ 
+ 153.5%
+
+ 
+ 
+ 150.3%
+
+ 
+ 
+ 146.0%
+
+ 
+ 
+ 140.5%
+
+ 
+ 
+ 134.0%
+
+ 
+ 
+ 126.5%
+
+ 
+ 
+ 118.1%
+
+ 
+ 
+ 109.1%
+
+ 
+ 
+ 99.4%
+
+ 
+ 
+ 89.2%
+
+ 
+ 
+ 78.6%
+
+ 
+ 
+
+ 
+ There can be no assurance that a Fund will achieve its investment objective or avoid substantial losses. A Fund does not seek to achieve its stated investment objective over a period of time greater than a single day because mathematical compounding prevents a Fund from achieving such results. Results for the Fund over periods of time greater than a single day should not be expected to be a simple return of the Index. The Fund s returns will likely differ in amount and possibly even direction from the inverse of (or twice) either the VIX or a portfolio of short-term VIX futures contracts over the same period. These differences can be significant. 
+ 
+
+ 37
+
+ Table of Contents
+
+ 
+ A Fund will lose money if its Index s performance is flat over time, and a Fund can lose money regardless of the performance of its Index, as a result of daily rebalancing, fees, an Index s volatility, compounding and other factors. Daily compounding of a Fund s investment returns can dramatically and adversely affect its longer-term performance, especially during periods of high volatility. Volatility has a negative impact on ta Fund s performance and may be at least as important to a Fund s return for a period as the return of its Index.
+ The VIX and either Index are separate indices and can be expected to perform very differently. The VIX is a non-investable index that measures the implied volatility of the S&P 500. For these purposes, implied volatility is a measure of the expected volatility (i.e., the rate and magnitude of variations in performance) of the S&P 500 over the next 30 days. The VIX does not represent the actual volatility of the S&P 500. The VIX is calculated based on the prices of a constantly changing portfolio of S&P 500 put and call options. The Short Index consists of short positions on short-term VIX futures contracts. And the Long Index consists of long positions on short-term VIX futures contracts. As such, the performance of either Index can be expected to be very different from an inverse of (or twice ) the actual volatility of the S&P 500 or an inverse (or twice) of the actual performance of the VIX.
+ HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM.
+
+ ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS.
+ VOLATILITY SHARES LLC HAS HAD LITTLE OR NO EXPERIENCE IN TRADING ACTUAL ACCOUNTS FOR ITSELF OR FOR CUSTOMERS. BECAUSE THERE ARE NO ACTUAL TRADING RESULTS TO COMPARE TO THE HYPOTHETICAL PERFORMANCE RESULTS, CUSTOMERS SHOULD BE PARTICULARLY WARY OF PLACING UNDUE RELIANCE ON THESE HYPOTHETICAL PERFORMANCE RESULTS.
+
+ Principal Investment Strategies
+
+ In seeking to achieve each Fund s investment objective, the Commodity Sub-Adviser uses a mathematical approach to investing. Using this approach, the Commodity Sub-Adviser determines the type, quantity and mix of investment positions that it believes, in combination, should produce daily returns consistent with each Fund s objective.
+
+ Each Fund intends to meet its investment objective by investing all or substantially all of its assets in positions in first and second month VIX futures contracts, though it may invest in any one of, or combinations of, Financial Instruments (e.g., futures contracts, options contracts and swap transactions), such that a Fund typically has exposure intended to approximate the Index at the time of its NAV calculation. Under normal market conditions, SVIX s portfolio will comprise short positions, and UVIX s portfolio will comprise long positions, on first- and second-month VIX futures contracts. The number and type of these contracts will naturally change day-to-day as each Fund takes a daily rolling position in such contracts.
+ 
+
+ 38
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+ Table of Contents
+
+ 
+ In the event that accountability rules, price limits, position limits, margin limits or other exposure limits are reached with respect to VIX futures contracts, the Sponsor may cause a Fund to obtain exposure to the Index through the use of options contracts or swap transactions referencing the VIX futures contracts. Each Fund may also invest in swaps if the market for a specific futures contract experiences emergencies (e.g., natural disaster, terrorist attack or an act of God) or disruptions (e.g., a trading halt or a flash crash) or in situations where the Sponsor deems it impractical or inadvisable to buy or sell futures contracts (such as during periods of market volatility or illiquidity).
+ Each Fund also may hold cash or cash equivalents such as U.S. Treasury securities or other high credit quality, short-term fixed-income or similar securities (such as shares of money market funds) as collateral for Financial Instruments and pending investment in Financial Instruments.
+
+ Neither Fund is actively managed by traditional methods (e.g., by effecting changes in the composition of a portfolio on the basis of judgments relating to economic, financial and market conditions with a view toward obtaining positive results under all market conditions). Each Fund seeks to remain fully invested at all times in Financial Instruments and money market instruments that, in combination, provide exposure to the Index consistent with its investment objective without regard to market conditions, trends or direction.
+
+ Each Fund seeks to position its portfolio so that its exposure to its Benchmark is consistent with its investment objective. The time and manner in which the Fund rebalances its portfolio is defined by the Index methodology but may vary from day to day depending upon market conditions and other circumstances, deemed at the discretion of the Commodity Sub-Adviser, beneficial at tracking the Benchmark, or beneficial to the Fund holders.
+
+ The amount of exposure a Fund has to a specific combination of Financial Instruments may differ and may be changed without shareholder approval at any given time. Currently, SVIX seeks to be, under normal market conditions and absent any unforeseen circumstances, fully exposed to short positions in short-term VIX futures contracts, and UVIX seeks to be, under normal market conditions and absent any unforeseen circumstances, fully exposed to long positions in short-term VIX futures contracts. To the extent that any options or swap transaction entered into by a Fund are believed by the Fund to be securities under the Investment Company Act of 1940, the Fund will limit its investments in such transactions so that such investments, in combination, will not exceed 40 percent of the Fund s assets (other than cash and government securities) and thereby avoid potentially being deemed an unregistered investment company. 
+ The amount of a Fund s exposure should be expected to change from time to time at the discretion of the Sponsor based on market conditions and other factors.
+
+ In addition, the Sponsor has the power to change the Fund s investment objective, Benchmark or investment strategy at any time, without shareholder approval, subject to applicable regulatory requirements.
+
+ Mitigating Price Impacts to VIX Futures Contract Prices at Times of Fund Rebalancing
+
+ The Sponsor will seek to minimize the market impact of rebalances across all exchange traded products based on VIX Futures Contracts that it sponsors (the VIX ETPs ) on the price of VIX futures contracts by limiting VIX ETP participation, on any given day, in VIX futures contracts to no more than ten percent (10%) of the contracts traded on Cboe Futures Exchange, Inc. ( CFE ) during any Rebalance Period, defined as any fifteen minute period of continuous market trading. In the event that any VIX ETP (including each Fund) expects to hit the ten percent threshold during the primary Rebalance Period from 3:45 p.m. to 4:00 p.m. (Eastern time), the VIX ETPs would extend participation during periods of market illiquidity, the Sponsor, on any given day, may vary the manner and period over which all funds it sponsors are rebalanced, and as such, the manner and period over which a Fund is rebalanced.
+ Index Performance Example
+
+ SVIX seeks to track the Short Index which measures the daily inverse performance of a portfolio of first- and second-month VIX futures contracts. UVIX seeks to track twice the Long Index which measures the performance of a portfolio of first- and second-month VIX futures contracts The Funds portfolios of futures contracts are rolled each day to maintain a consistent time to maturity of approximately one month. On any Business Day, SVIX s portfolio comprises a number of short positions in first-month and second-month VIX futures contracts. On any 
+ 
+
+ 39
+
+ Table of Contents
+
+ 
+ Business Day, UVIX s portfolio comprises a number of long positions in first-month and second-month VIX futures contracts. The fraction of the Funds portfolios rolled each Business Day is proportional to the number of first-month futures contracts held and inversely proportional to the number of days in the Roll Period.
+
+ SVIX Example
+
+ For example, on January 2, 2020 the Fund s portfolio would have comprised a short position in the first-month VIX futures contract expiring on January 22, 2020 equal to 59.1% of the total number of short VIX futures contracts held by the Fund, and a short position in the second-month VIX futures contract expiring on February 19, 2020 equal to 40.9% of the total number of short VIX futures contracts held.
+
+ To illustrate this example in VIX futures contracts, supposing the first-month VIX futures contract was priced at 14.82 and the second-month at 16.79, the Fund s portfolio with a hypothetical AUM of $10m would consist of a total short position of 640 VIX futures contracts calculated as ($10,000,000 / (0.591 * 14.82) + (0.409 * 16.79))/1000, with 59.1% of the short contracts held in the January futures (short 378 contracts) and 40.9% in the February futures (short 262 contracts).
+
+ Between 3:45pm ET and 4:00pm ET (the TWAP period) a fraction of the January expiring short VIX futures contracts would be rolled to the February expiring contracts, resulting in a portfolio the next day comprised of 54.5% first-month VIX futures contracts expiring in January and 45.5% second-month VIX futures contracts expiring in February.
+
+ This daily rolling would continue each Business Day until the day before the January futures expiry January 21, 2020 when between 3:45pm ET and 4:00pm ET all remaining January VIX futures contracts would have been rolled to the February expiry.
+
+ On the day of the January expiry January 22, 2020 the Roll Period would begin again, with the futures expiring in February 19, 2020 becoming the new first-month contract, and the next monthly VIX futures contract expiring on March 18, 2020 becoming the new second-month contract.
+
+ By rolling the Fund s portfolio from the first to the second nearest month VIX futures contracts in daily fractional amounts, the Fund seeks to maintain a constant weighted average time to maturity of approximately one month.
+
+ UVIX Example
+
+ For example, on January 2, 2020 the Fund s portfolio would have comprised a long position in the first-month VIX futures contract expiring on January 22, 2020 equal to 59.1% of the total number of long VIX futures contracts held by the Fund, and a long position in the second-month VIX futures contract expiring on February 19, 2020 equal to 40.9% of the total number of long VIX futures contracts held.
+
+ To illustrate this example in VIX futures contracts, supposing the first-month VIX futures contract was priced at 14.82 and the second-month at 16.79, the Fund s portfolio with a hypothetical AUM of $10m would consist of a total long position of 1,280 VIX futures contracts calculated as 2 * (($10,000,000 / (0.591 * 14.82) + (0.409 * 16.79))/1000), with 59.1% of the long contracts held in the January futures (long 756 contracts) and 40.9% in the February futures (long 524 contracts).
+
+ Between 3:45pm ET and 4:00pm ET (the TWAP period) a fraction of the January expiring long VIX futures contracts would be rolled to the February expiring contracts, resulting in a portfolio the next day comprised of 54.5% first-month VIX futures contracts expiring in January and 45.5% second-month VIX futures contracts expiring in February.
+
+ This daily rolling would continue each Business Day until the day before the January futures expiry January 21, 2020 when between 3:45pm ET and 4:00pm ET all remaining January VIX futures contracts would have been rolled to the February expiry.
+
+ On the day of the January expiry January 22, 2020 the Roll Period would begin again, with the futures expiring in February 19, 2020 becoming the new first-month contract, and the next monthly VIX futures contract expiring on March 18, 2020 becoming the new second-month contract.
+
+ 
+
+ 40
+
+ Table of Contents
+
+ 
+ By rolling the Fund s portfolio from the first to the second nearest month VIX futures contracts in daily fractional amounts, the Fund seeks to maintain a constant weighted average time to maturity of approximately one month.
+
+ Futures Contracts
+
+ A futures contract is a standardized contract traded on, or subject to the rules of, an exchange that calls for the future delivery of a specified quantity and type of a particular underlying asset at a specified time and place or alternatively may call for cash settlement. Futures contracts are traded on a wide variety of underlying assets, including bonds, interest rates, agricultural products, stock indexes, currencies, energy, metals, economic indicators and statistical measures. The notional size and calendar term futures contracts on a particular underlying asset are identical and are not subject to any negotiation, other than with respect to price and the number of contracts traded between the buyer and seller. A Fund generally deposits cash and/or securities with an FCM for its open positions in futures contracts, which may, in turn, transfer such deposits to the clearinghouse to protect the clearing house against non-payment by the Fund. The clearing house becomes substituted for each counterparty to a futures contract, and, in effect, guarantees performance. In addition, the FCM may require a Fund to deposit collateral in excess of the clearing house s margin requirements for the FCM s own protection.
+ Certain futures contracts, including stock index contracts, VIX futures contracts and certain commodity futures contracts settle in cash. The cash settlement amount reflects the difference between the contract purchase/sale price and the contract settlement price. The cash settlement mechanism avoids the potential for either side to have to deliver the underlying asset. For other futures contracts, the contractual obligations of a buyer or seller may generally be satisfied by taking or making physical delivery of the underlying asset or by making an offsetting sale or purchase of an identical futures contract on the same or linked exchange before the designated date of delivery. The difference between the price at which the futures contract is purchased or sold and the price paid for the offsetting sale or purchase, after allowance for brokerage commissions and exchange fees, constitutes the profit or loss to the trader.
+ Futures contracts involve, to varying degrees, elements of market risk and exposure to loss in excess of the amounts of variation margin, which are the amounts of cash that a Fund agrees to pay to or receive from FCMs equal to the daily fluctuation in the value of a futures contract. Additional risks associated with the use of futures contracts are imperfect correlation between movements in the price of the futures contracts and the level of the underlying benchmark and the possibility of an illiquid market for a futures contract. With futures contracts, there is minimal but some counterparty risk to a Fund since futures contracts are exchange traded and the exchange s clearing house, as counterparty to all exchange-traded futures contracts, effectively guarantees futures contracts against default. Many futures exchanges and boards of trade limit the amount of fluctuation permitted in futures contract prices during a single trading day. Once the daily limit has been reached in a particular contract, no trades may be made that day at a price beyond that limit or trading may be suspended for specified times during the trading day. Futures contracts prices could move to the limit for several consecutive trading days with little or no trading, thereby preventing prompt liquidation of futures positions and potentially subjecting a Fund to substantial losses. If trading is not possible or if a Fund determines not to close a futures position in anticipation of adverse price movements, the Fund may be required to make daily cash payments of variation margin.
+ Futures Account Agreements
+
+ Each Fund has entered into a written agreement (each, a Futures Account Agreement ) with one or more FCMs governing the terms of futures transactions of a Fund cleared by such FCM. Each FCM has its own agreement and other documentation used for establishing customer relationships. As such, the terms of the Futures Account Agreement and other documentation that a Fund has with a particular FCM may differ in material respects from that with another FCM.
+
+ Most Futures Account Agreements do not require the FCM to enter into new transactions or maintain existing transactions with a Fund. In general, each FCM is permitted to terminate its agreement with a Fund at any time in its sole discretion. In addition, an FCM generally will have the discretion to set margin requirements and/or position limits that would be in addition to any margin requirements and/or position limits required by applicable law, set by the exchange, or set by the clearing house that clears the futures contracts in which a Fund transacts. As a result, a Fund s ability to engage in futures transactions or maintain open positions in such contracts will be dependent on the willingness of its FCMs to continue to accept or maintain such transactions on terms that are economically appropriate for a Fund s investment strategy.
+ 
+
+ 41
+
+ Table of Contents
+
+ 
+ When a Fund has an open futures contract position, it is subject to at least daily variation margin calls by an FCM that could be substantial in the event of adverse price movements. Because futures contracts may require only a small initial investment in the form of a deposit or margin, they may involve a high degree of leverage. A Fund with open positions is subject to maintenance or variance margin on its open positions. If a Fund has insufficient cash to meet daily variation margin requirements, it may need to sell Financial Instruments at a time when such sales are disadvantageous. Futures markets are highly volatile and the use of or exposure to futures contracts may increase volatility of a Fund s NAV.
+ Margin posted by a Fund to an FCM typically will be held by relevant exchange s clearing house (in the case of clearing house-required margin) or the FCM (in the case of house margin requirements of the FCM). In the event that market movements favorable to a Fund result in the Fund having posted more margin than is required, the Fund typically would have a right to return of margin from the FCM. However, the timing of such return may be uncertain. As a result, it is possible that a Fund may face liquidity constraints including potential delays in its ability to pay redemption proceeds, where margin is not immediately returned by an FCM.
+ In the event that a Fund fails to comply with its obligations under a Futures Account Agreement (including, for example, failing to deliver the margin required by an FCM on a timely basis), the Futures Account Agreement typically will provide the FCM with broad discretion to take remedial action against the Fund. Among other things, the FCM typically will have the right, upon the occurrence of such a failure by a Fund, to terminate any or all futures contracts in the Fund s account with that FCM, to sell the collateral posted as margin by the Fund, to close out any open positions of the Fund in whole or in part, and to cancel any or all pending transactions with the Fund. Futures Account Agreements typically provide that the Fund will remain liable for paying to the relevant FCM, on demand, the amount of any deficiency in a Fund s account with that FCM.
+ The Futures Account Agreement between the Fund and an FCM generally requires the Fund to indemnify and hold harmless the FCM, its directors, officers, employees, agents and affiliates (collectively, indemnified persons ) from and against all claims, damages, losses and costs (including reasonable attorneys fees) incurred by the indemnified persons, in connection with: (1) any failure by the Fund to perform its obligations under the Futures Account Agreement and the FCM s exercise of its rights and remedies thereunder; (2) any failure by the Fund to comply with applicable law; (3) any action reasonably taken by the indemnified persons pursuant to the Futures Account Agreement to comply with applicable law; and (4) any actions taken by the FCM in reliance on instructions, notices and other communications that the FCM and its relevant personnel, as applicable, reasonably believes to originate from a person authorized to act on behalf of the Fund.
+ To the extent that the Fund trades in futures contracts on U.S. exchanges, the assets deposited by the Fund with the FCMs (or another eligible financial institution, as applicable) as margin must be segregated pursuant to the regulations of the CFTC. Such segregated funds may be invested only in a limited range of instruments principally U.S. government obligations to margin futures and forward contract positions.
+
+ Each Fund currently uses each of the following firms as an FCM: ADM Investor Services, Inc. ( ADMIS ), StoneX Financial Inc. FCM, Straits Financial LLC and E D& F Man Capital Markets Inc. The FCMs used by a Fund may change from time to time. The above discussion relating to an FCM also would apply to other firms that serve as an FCM to a Fund in the future. Each FCM in its capacity as a registered FCM, serves as a clearing broker to the Trust and a Fund and certain other funds of the Trust and as such arranges for the execution and clearing of a Fund s futures transactions. Each FCM acts as clearing broker for many other funds and individuals. A variety of executing brokers may execute futures transactions on behalf of the Funds. The executing brokers will give-up all such transactions to an FCM as applicable. Each FCM is registered as an FCM with the CFTC, is a member of the NFA and a clearing member of the CBOT, CME, NYMEX, or another major U.S. commodity exchange. No FCM is affiliated with or acts as a supervisor of the Trust, the Funds, the Sponsor, the Commodity Sub-Adviser, the Trustee, the Administrator, Sub-Administrator, Transfer Agent, or the Custodian. No FCM acts as an underwriter or sponsor of the offering of the Shares, or has passed upon the merits of participating in this offering or has passed upon the adequacy of this Prospectus or on the accuracy of the information contained herein. No FCM provides any commodity trading advice regarding a Fund s trading activities. Investors should not rely upon an FCM in deciding whether to invest in a Fund or retain their interests in the Fund. Prospective investors should also note that the Sponsor may select additional clearing brokers or replace any FCM as a Fund s clearing broker.
+ 
+
+ 42
+
+ Table of Contents
+
+ 
+ Options
+
+ An option is a contract that gives the purchaser of the option, in return for the premium paid, the right to buy an underlying reference instrument, such as a specified security, currency, index, or other instrument, from the writer of the option (in the case of a call option), or to sell a specified reference instrument to the writer of the option (in the case of a put option) at a designated price during the term of the option. The premium paid by the buyer of an option will reflect, among other things, the relationship of the exercise price to the market price and the volatility of the underlying reference instrument, the remaining term of the option, supply, demand, interest rates and/or currency exchange rates. An American style put or call option may be exercised at any time during the option period while a European style put or call option may be exercised only upon expiration or during a fixed period prior thereto. Put and call options are traded on national securities exchanges and in the OTC market. Options traded on national securities exchanges are within the jurisdiction of the SEC or other appropriate national securities regulator, as are securities traded on such exchanges. As a result, many of the protections provided to traders on organized exchanges will be available with respect to such transactions. In particular, all option positions entered into on a national securities exchange in the United States are cleared and guaranteed by the Options Clearing Corporation, thereby reducing the risk of counterparty default. Furthermore, a liquid secondary market in options traded on a national securities exchange may be more readily available than in the OTC market, potentially permitting a Fund to liquidate open positions at a profit prior to exercise or expiration, or to limit losses in the event of adverse market movements. There is no assurance, however, that higher than anticipated trading activity or other unforeseen events might not temporarily render the capabilities of the Options Clearing Corporation inadequate, and thereby result in the exchange instituting special procedures which may interfere with the timely execution of a Fund s orders to close out open options positions.
+ Swap Agreements
+
+ Swaps are contracts that have traditionally been entered into primarily by institutional investors in OTC markets for a specified period ranging from a day to many years. Certain types of swaps may be cleared, and certain types are, in fact, required to be cleared. The types of swaps that may be cleared are generally limited to only swaps where the most liquidity exists and a clearing organization is willing to clear the trade on standardized terms. Swaps with customized terms or those for which significant market liquidity does not exist are generally not able to be cleared.
+
+ In a standard swap transaction, the parties agree to exchange the returns on, among other things, a particular predetermined security, commodity, interest rate, or index for a fixed or floating rate of return (the interest rate leg, which will also include the cost of borrowing for short swaps) in respect of a predetermined notional amount. The notional amount of the swap reflects the extent of a Fund s total investment exposure under the swap.
+
+ In the case of futures contracts-based indexes, such as those used by a Fund, the reference interest rate typically is zero, although a financing spread or fee is generally still applied. Transaction or commission costs are reflected in the benchmark level at which the transaction is entered into. The gross returns to be exchanged are calculated with respect to the notional amount and the benchmark returns to which the swap is linked. Swaps are usually closed out on a net basis, i.e., the two payment streams are netted out in a cash settlement on the payment date specified in the agreement, with the parties receiving or paying, as the case may be, only the net amount of the two payments. Thus, while the notional amount reflects a Fund s total investment exposure under the swap (i.e., the entire face amount or principal of a swap), the net amount is the Fund s current obligations (or rights) under the swap. That is the amount to be paid or received under the agreement based on the relative values of the positions held by each party to the agreement on any given termination date.
+ Swaps may also expose a Fund to liquidity risk. Although a Fund may have the ability to terminate a swap at any time, doing so may subject the Fund to certain early termination charges. In addition, there may not be a liquid market within which to dispose of an outstanding swap even if a permitted disposal might avoid an early termination charge. Uncleared swaps generally are not assignable except by agreement between the parties to the swap, and generally no party or purchaser has any obligation to permit such assignments.
+
+ 
+
+ 43
+
+ Table of Contents
+
+ 
+ Swaps involve, to varying degrees, elements of market risk and exposure to loss in excess of the amount which would be reflected on a Fund s Statement of Financial Condition. In addition to market risk and other risks, the use of swaps also comes with counterparty credit risk i.e., the inability of a counterparty to a swap to perform its obligations. A Fund that invests in swaps bears the risk of loss of the net amount, if any, expected to be received under a swap agreement in the event of the default or bankruptcy of a swap counterparty. A Fund enters or intends to enter into swaps only with major, global financial institutions. However, there are no limitations on the percentage of its assets a Fund may invest in swaps with a particular counterparty.
+ A Fund that invests in swaps may use various techniques to minimize counterparty credit risk. A Fund that invests in swaps generally enters into arrangements with its counterparties whereby both sides exchange collateral on a mark-to-market basis. In addition, the Fund may post initial margin or independent amount to counterparties in swaps. Such collateral serves as protection for the counterparty in the event of a failure by the Fund and is in addition to any mark-to-market collateral that (i.e., the Fund may post initial margin to the counterparty even where the counterparty would owe money to the Fund if the swap were to be terminated). The amount of initial margin posted by the Fund may vary depending on the risk profile of the swap. The collateral, whether for mark-to-market or for initial margin, generally consists of cash and/or securities.
+ Collateral posted by a Fund to a counterparty in connection with uncleared derivatives transactions is generally held for the benefit of the counterparty in a segregated tri-party account at a third-party custodian to protect the counterparty against non-payment by the Fund. In the event of a default by a Fund where the counterparty is owed money in the uncleared swap transaction, such counterparty will seek withdrawal of this collateral from the segregated account.
+
+ Collateral posted by the counterparty to a Fund is typically held for the benefit of the Fund in a segregated tri-party account at a third-party custodian. In the event of a default by the counterparty where the Fund is owed money in the uncleared swap transaction, the Fund will seek withdrawal of this collateral from the segregated account. The Fund may incur certain costs exercising its right with respect to the collateral.
+
+ Notwithstanding the use of collateral arrangements, to the extent any collateral provided to a Fund is insufficient or there are delays in accessing the collateral, a Fund will be exposed to counterparty risk as described above, including possible delays in recovering amounts as a result of bankruptcy proceedings.
+
+ Money Market Instruments
+
+ Money market instruments are short-term debt instruments that have a remaining maturity of 397 days or less and exhibit high quality credit profiles. Money market instruments may include U.S. government securities, securities issued by governments of other developed countries and repurchase agreements.
+
+ U.S. Derivatives Exchanges
+
+ Derivatives exchanges, including swap execution facilities that are required under the Dodd-Frank Act, provide centralized market facilities for trading derivatives in which multiple persons have the ability to execute or trade contracts by accepting bids and offers from multiple participants. Members of, and trades executed on, a particular exchange are subject to the rules of that exchange. Among the principal exchanges in the United States are the CBOE (which includes the CBOE Futures Exchange (the CFE )), the Chicago Mercantile Exchange ( CME ) (which includes, among others, the Chicago Board of Trade ( CBOT ) and the New York Mercantile Exchange (the NYMEX ) and the Intercontinental Exchange ( ICE )).
+ Each derivatives exchange in the United States has an associated clearing house. Clearing houses provide services designed to transfer credit risk and ensure the integrity of trades. Once trades between members of an exchange have been confirmed and/or cleared, the clearing house becomes substituted for each buyer and each seller of contracts traded on the exchange and, in effect, becomes the other party to each trader s open position in the market. Thereafter, each party to a trade looks only to the clearing house for performance. The clearing house generally establishes some sort of security or guarantee fund to which all clearing members of the exchange must contribute. This fund acts as an emergency buffer which is intended to enable the clearing house to meet its obligations with regard to the other side of an insolvent clearing member s contracts. Furthermore, clearing houses require margin deposits and continuously mark positions to market to provide some assurance that their members will be able to fulfil their contractual obligations. Thus, members effecting derivatives transactions on an organized 
+ 
+
+ 44
+
+ Table of Contents
+
+ 
+ exchange or clearing an OTC derivatives transaction through a clearing house do not bear the risk of the insolvency of the party on the opposite side of the trade; their credit risk is limited to the respective solvencies of their commodity broker and the clearing house. The clearing house guarantee of performance on open positions does not run to customers. If a member firm goes bankrupt, customers could lose money.
+
+ If a Fund decides to execute derivatives transactions through such derivatives exchanges and especially if it decides to become a direct member of one or more exchanges or swap execution facilities the Fund would be subject to the rules of the exchange or swap executive facility, which would bring additional risks and liabilities, and potential additional regulatory requirements.
+
+ Regulations
+
+ Derivatives exchanges in the United States are subject to regulation under the CEA, by the CFTC, the governmental agency having responsibility for regulation of derivatives exchanges and trading on those exchanges. Following the adoption of the Dodd-Frank Act, the CFTC also has authority to regulate OTC derivatives markets, including certain OTC foreign exchange markets.
+
+ The CFTC has exclusive authority to designate exchanges for the trading of specific futures contracts and to prescribe rules and regulations of the marketing of each. The CFTC also regulates the activities of commodity pool operators and the CFTC has adopted regulations with respect to certain of such persons activities. Pursuant to its authority, the CFTC requires a commodity pool operator, such as the Sponsor, to keep accurate, current and orderly records with respect to each pool it operates. The CFTC may suspend, modify or terminate the registration of any registrant for failure to comply with CFTC rules or regulations. Suspension, restriction or termination of the Sponsor s registration as a commodity pool operator would prevent it, until such time (if any) as such registration were to be reinstated, from managing, and might result in the termination of the Fund. If the Sponsor were unable to provide services and/or advice to the Fund, the Fund would be unable to pursue its investment objective unless and until the Sponsor s ability to provide services and advice to the Fund was reinstated or a replacement for the Sponsor as commodity pool operator could be found. Such an event could result in termination of the Fund.
+ The CEA requires all FCMs to meet and maintain specified fitness and financial requirements, segregate customer funds from proprietary funds and account separately for all customers funds and positions, and to maintain specified books and records open to inspection by the staff of the CFTC.
+
+ The CEA also gives the states certain powers to enforce its provisions and the regulations of the CFTC.
+
+ Under certain circumstances, the CEA grants shareholders the right to institute a reparations proceeding before the CFTC against the Sponsor (as a registered commodity pool operator), an FCM, as well as those of their respective employees who are required to be registered under the CEA. Shareholders may also be able to maintain a private right of action for certain violations of the CEA.
+
+ Pursuant to authority in the CEA, the NFA has been formed and registered with the CFTC as a registered futures association. At the present time, the NFA is the only self-regulatory organization for commodities professionals other than exchanges. As such, the NFA promulgates rules governing the conduct of commodity professionals and disciplines those professionals that do not comply with such standards. The CFTC has delegated to the NFA responsibility for the registration of commodity pool operators, FCMs, swap dealers, commodity trading advisors, introducing brokers and their respective associated persons and floor brokers. The Sponsor is a member of the NFA (each Fund itself is not required to become members of the NFA). As an NFA member, the Sponsor is subject to NFA standards relating to fair trade practices, financial condition, and consumer protection.
+ The CEA and CFTC regulations prohibit market abuse and generally require that all futures exchange-based trading be conducted in compliance with rules designed to ensure the integrity of market prices and without any intent to manipulate prices. CFTC regulations and futures exchange rules also impose limits on the size of the positions that a person may hold or control as well as standards for aggregating certain positions. The rules of the CFTC and the futures exchanges also authorize special emergency actions to halt, suspend or limit trading overall or to restrict, halt, suspend or limit the trading of an individual trader or to otherwise impose special reporting or margin requirements.
+ Each Fund s investments in Financial Instruments will be subject to regulation under the CEA and traded pursuant to CFTC and applicable exchange regulations.
+
+ 
+
+ 45
+
+ Table of Contents
+
+ 
+ Daily Limits
+
+ Most U.S. futures exchanges (but generally not foreign exchanges or banks or dealers in the cases of swap agreements) limit the amount of fluctuation in some futures contract or options contract prices during a single day by regulations. These regulations specify what are referred to as daily price fluctuation limits or more commonly daily limits. Once the daily limit has been reached in a particular futures contract, no trades may be made at a price beyond that limit. Currently, CBOE limits daily VIX futures contracts to no more than 50,000 per entity.
+
+ Margin
+
+ Initial or original margin is the minimum dollar amount that a counterparty to a cleared derivatives contract must deposit with its commodity broker in order to establish an open position. Maintenance or variation margin is the amount (generally less than initial margin) to which a trader s account may decline before he must deliver additional margin so as to maintain open positions. A margin deposit is like a cash performance bond. It helps assure the futures trader s performance of the futures contracts he purchases or sells.
+
+ The minimum amount of margin required in connection with a particular futures contract is set by the exchange on which such contract is traded and is subject to change at any time during the term of the contract. Futures contracts are customarily bought and sold on margins that represent a percentage of the aggregate purchase or sales price of the contract.
+
+ Brokerage firms may require higher amounts of margin than exchange minimums. These requirements may change without warning.
+
+ Margin requirements are computed each day or intraday by a commodity broker and the relevant exchange. At the close of each trading day or intraday, each open futures contract is marked to market, that is, the gain or loss on the position is calculated from the prior day s close. When the market value of a particular open futures contract position changes to a point where the margin on deposit does not satisfy maintenance margin requirements, a margin call is made by the commodity broker. If the margin call is not met within a reasonable time, the broker may close out the customer s position.
+
+ 
+
+ 46
+
+ Table of Contents
+
+ 
+ PERFORMANCE OF ACCOUNTS
+ADVISED BY THE COMMODITY SUB-ADVISER
+
+ The following performance information is presented in accordance with CFTC regulations. The performance of the Fund will differ materially from the performance of the following accounts and pools operated by the Commodity Sub-Adviser. The performance of each of the following commodity pools or accounts is materially different from the Fund, each commodity pool or account is different from another, and the below summaries are not representative of how the Fund will perform in the future. For certain commodity pools that are asterisked(*), the Commodity Sub-Adviser is only responsible for specific aspects of the commodity pool s strategy. The Commodity Sub-Adviser s other accounts are Institutional Accounts and are not products that may be invested in. All of Commodity Sub-Adviser s other pools or accounts are types of risk management strategies, where absolute performance is not an appropriate measurement of success. All commodity pools and accounts where the Commodity Sub-Adviser directed client commodity assets are shown below.
+ All worst monthly loss and worst peak-to-valley loss performance information is current through October 31, 2021.
+
+ 
+
+ 
+ 
+
+ Name of Program:
+
+ 
+ 
+ 
+ Institutional Account #1
+
+ 
+ 
+
+ 
+ 
+ Type of Program:
+
+ 
+ 
+ 
+ Institutional Account
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ March, 19, 2014
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -1.82% (December 2018)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -2.98% (December 2019 to March 2020)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ (0.83
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.26
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.42
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.92
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.04
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.12
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ (0.06
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.46
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.30
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.66
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.37
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.22
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ 0.58
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.09
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.36
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.34
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.59
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.32
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ (0.01
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.19
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.04
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.83
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.20
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.24
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ 0.16
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.25
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.45
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.57
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.47
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.10
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ (0.08
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.11
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.38
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.22
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.16
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ 0.61
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.31
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.62
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.35
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.81
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.13
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ 0.09
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.08
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.45
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.52
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.66
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.19
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ (0.01
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.30
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.11
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.47
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.32
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.30
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (0.30
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.45
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.33
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.27
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.51
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ 0.58
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.32
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.27
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.41
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.25
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ 0.24
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.16
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.82
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.28
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.33
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ 0.97
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.93
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.48
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.90
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.31
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1.47
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 47
+
+ Table of Contents
+
+ 
+ 
+
+ 
+ 
+
+ Name of Program:
+
+ 
+ 
+ 
+ Institutional Account #2
+
+ 
+ 
+
+ 
+ 
+ Type of Program:
+
+ 
+ 
+ 
+ Institutional Account
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ August 30, 2007
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -3.11% (November 2016)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -15.27% (February 2016 to March 2021)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ 2.86
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.51
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.56
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.07
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.06
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.00
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ 1.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.30
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.02
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.74
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.55
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.18
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ (1.82
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.36
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.51
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.76
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.95
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.67
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ (0.53
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.27
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.58
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.90
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.54
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.10
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ (0.06
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.20
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.03
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.29
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.53
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.16
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ 1.78
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.51
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.10
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.78
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.55
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.64
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ (0.55
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.30
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.65
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.01
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.16
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.39
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ (0.27
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.70
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.02
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.56
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.60
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.38
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ (0.43
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.02
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.46
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.14
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.62
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.31
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (0.73
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.49
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.66
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.90
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.57
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.53
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ (3.11
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.38
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.24
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.12
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (2.25
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ (1.00
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.08
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.12
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.60
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.33
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ (2.60
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (2.60
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.17
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.71
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.35
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (4.69
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 
+ 
+
+ Name of Program:
+
+ 
+ 
+ 
+ Institutional Account #3
+
+ 
+ 
+
+ 
+ 
+ Type of Program:
+
+ 
+ 
+ 
+ Institutional Account
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ August 2, 2013
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -2.13% (April 2020)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -11.28% (March 2020 to April 2021)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ 1.45
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.41
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.95
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.01
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.33
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.60
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ 0.38
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.10
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.02
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.28
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.02
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.15
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ (0.91
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.22
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.43
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.50
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.18
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.06
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ (0.44
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.05
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.57
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.59
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (2.13
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.09
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ (0.07
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.13
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.05
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.71
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.12
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.04
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ 0.96
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.13
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.24
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.51
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.02
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.26
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ (0.78
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.27
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.40
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.19
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.64
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.51
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ (0.11
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.33
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.09
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.44
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.08
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.22
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ (0.13
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.59
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.37
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.83
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.98
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.14
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (0.26
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.35
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.78
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.87
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.73
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ (1.20
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.22
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.27
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.63
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ (0.51
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.14
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.62
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.77
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.64
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ (1.63
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.94
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.57
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.72
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.62
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (2.44
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 48
+
+ Table of Contents
+
+ 
+ 
+
+ 
+ 
+
+ Name of Program:
+
+ 
+ 
+ 
+ Institutional Account #4
+
+ 
+ 
+
+ 
+ 
+ Type of Program:
+
+ 
+ 
+ 
+ Institutional Account
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ February 1, 2018
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -5.32% (March 2020)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -6.61% (January 2020 to March 2020)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018*
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1.84
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.59
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.35
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 0.75
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.36
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.46
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 0.95
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (5.32
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.21
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1.74
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.44
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.12
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 0.33
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.18
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.03
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.09
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (0.25
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 4.24
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.65
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.14
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 0.57
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.28
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.76
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.62
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 1.24
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.19
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.01
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.27
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (0.17
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.27
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.27
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.86
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (3.52
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.92
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.01
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.00
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 0.42
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.31
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (2.51
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.86
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.05
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (3.92
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 10.81
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 6.69
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (0.93
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ *This account did not trade between the months of February 2018 through April 2018
+
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 
+ 
+
+ Name of Program:
+
+ 
+ 
+ 
+ Institutional Account #5
+
+ 
+ 
+
+ 
+ 
+ Type of Program:
+
+ 
+ 
+ 
+ Institutional Account
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ April 13, 2013
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -2.07% (October 2018)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -3.23% (January 2018 to March 2020)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ (0.76
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.50
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.13
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.53
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.12
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.19
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ (0.06
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.98
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.47
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.36
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.49
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.48
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ 0.49
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.02
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.85
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.28
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.23
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.81
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.25
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.07
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.75
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.78
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.74
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ 0.18
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.48
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.50
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.44
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.38
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.19
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.16
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.06
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.09
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.20
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.52
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ 0.64
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.62
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.84
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.26
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.70
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.45
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ 0.01
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.01
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.73
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.60
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.85
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.65
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ (0.14
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.57
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.18
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.29
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.63
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.02
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (0.53
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.67
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.07
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.28
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.35
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.12
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ 0.73
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.90
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.11
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.58
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.46
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ 0.40
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.30
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.16
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.49
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.54
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ 0.96
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 5.51
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.11
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.88
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.04
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 3.79
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 49
+
+ Table of Contents
+
+ 
+ 
+
+ 
+ 
+
+ Name of Program:
+
+ 
+ 
+ 
+ Institutional Account #6
+
+ 
+ 
+
+ 
+ 
+ Type of Program:
+
+ 
+ 
+ 
+ Institutional Account
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ September 24, 2009
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -1.95% (November 2016)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -5.97% (August 2016 to September 2018)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ 1.59
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.47
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.73
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.73
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.04
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.56
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ 0.87
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.11
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.79
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.53
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.20
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ (0.80
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.03
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.58
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.89
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.92
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.01
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ (0.36
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.38
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.68
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.30
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.42
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.10
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ 0.21
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.20
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.24
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.80
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.15
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.08
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ 1.30
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.16
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.01
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.01
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.07
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.07
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ 0.04
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.26
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.42
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.06
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.32
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.08
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ 0.15
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.80
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.16
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.88
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.21
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.20
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ (0.23
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.70
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.48
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.57
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.08
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.33
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (1.07
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.51
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.28
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.23
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.53
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.01
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ (1.95
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.15
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.05
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.34
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.16
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ (0.41
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.16
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.58
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.62
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.43
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ (0.71
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.33
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.24
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.15
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.48
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (0.09
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 
+ 
+
+ Name of Program:
+
+ 
+ 
+ 
+ Institutional Account #7
+
+ 
+ 
+
+ 
+ 
+ Type of Program:
+
+ 
+ 
+ 
+ Institutional Account
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ January 1, 2016
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -2.19% (November 2016)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -8.28% (June 2016 to September 2018)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ 1.76
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.34
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.31
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.23
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.49
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ 0.89
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.17
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.02
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.21
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.11
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.30
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ (0.83
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.35
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.52
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.67
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.21
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.03
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ (0.27
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.16
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.64
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.41
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.19
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.14
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ (0.02
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.23
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.02
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.32
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.72
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.07
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ 1.36
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.34
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.10
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.08
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.01
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.48
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ (0.20
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.34
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.57
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.06
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.02
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.37
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ (0.16
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.58
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.01
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.96
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.34
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.16
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ (0.38
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.85
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.35
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.70
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.29
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (0.60
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.36
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.20
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.75
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.38
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.13
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ (2.19
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.15
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.24
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.54
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.03
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ (0.77
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.91
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.77
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.58
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ (1.46
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.82
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.13
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.63
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.34
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (2.34
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 50
+
+ Table of Contents
+
+ 
+ 
+
+ 
+ 
+
+ Name of Program:
+
+ 
+ 
+ 
+ Institutional Account #8
+
+ 
+ 
+
+ 
+ 
+ Type of Program:
+
+ 
+ 
+ 
+ Institutional Account
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ June 20, 2007
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -3.89% (November 2016)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -18.80% (February 2016 to March 2021)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ 3.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.76
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (2.05
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (2.12
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.62
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.77
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ 1.46
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.65
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.03
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.10
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 4.36
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.59
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ (2.54
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.42
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.78
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.25
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 7.22
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.65
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ (0.65
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.35
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.22
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.29
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (3.60
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ (0.12
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.33
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.04
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.48
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.18
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ 2.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.83
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.07
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.06
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.44
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.81
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ (0.77
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.56
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.08
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.18
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.35
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.76
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ (0.26
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.02
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.09
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.06
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.15
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.59
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ (0.44
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.40
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.78
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.70
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.60
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.01
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (1.13
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.63
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.22
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.03
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.99
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.88
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ (3.89
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.47
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.24
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.22
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (2.34
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ (1.19
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.09
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.59
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.81
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.42
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ (3.95
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (3.87
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.83
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.57
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.24
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (5.80
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 
+ 
+
+ Name of Program:
+
+ 
+ 
+ 
+ Institutional Account #9
+
+ 
+ 
+
+ 
+ 
+ Type of Program:
+
+ 
+ 
+ 
+ Institutional Account
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ March 31, 2007
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -1.46% (November 2016)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -8.69% (February 2016 to May 2021)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ 1.57
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.44
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.75
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.99
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.62
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.04
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ 0.69
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.33
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.06
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.49
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.26
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.67
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ (1.38
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.24
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.34
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.38
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.71
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ (0.30
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.05
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.48
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.43
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.32
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.10
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ (0.15
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.04
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.02
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.05
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.84
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.07
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ 1.01
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.29
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.06
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.50
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.26
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.10
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ (0.50
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.29
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.38
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.03
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.25
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.19
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ (0.34
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.21
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.01
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.14
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.93
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.16
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ (0.23
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.53
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.24
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.43
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.23
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.08
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (0.30
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.20
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.71
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.43
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.08
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.30
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ (1.46
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.20
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.06
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.37
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.17
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ (0.44
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.35
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.51
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.42
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ (1.87
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (2.22
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.67
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.63
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.15
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (1.08
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 51
+
+ Table of Contents
+
+ 
+ 
+
+ 
+ 
+
+ Name of Program:
+
+ 
+ 
+ 
+ Institutional Account #10
+
+ 
+ 
+
+ 
+ 
+ Type of Program:
+
+ 
+ 
+ 
+ Institutional Account
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ January 1, 2019
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -4.17% (April 2020)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -18.91% (March 2020 to October 2021)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (2.85
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.04
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.49
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (1.23
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 4.52
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.15
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 0.71
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 6.15
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.16
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (1.53
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (4.17
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.30
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 3.74
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.23
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.11
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (1.71
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.75
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.31
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (0.21
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.78
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.76
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 3.67
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.86
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.71
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (1.67
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.09
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.09
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (1.09
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.24
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.10
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (1.10
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (3.50
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (1.63
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.34
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (5.03
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (2.59
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (5.76
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 
+ 
+
+ Name of Program:
+
+ 
+ 
+ 
+ Institutional Account #11
+
+ 
+ 
+
+ 
+ 
+ Type of Program:
+
+ 
+ 
+ 
+ Institutional Account
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ June 13, 2007
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -1.20% (April 2020)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -5.23% (February 2016 to October 2021)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ 0.16
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.08
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.16
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.47
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.04
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.11
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ 0.03
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.11
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.16
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.41
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.11
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ (0.21
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.03
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.05
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.05
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.44
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.11
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ (0.02
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.06
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.04
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.16
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.20
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.13
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ (0.03
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.05
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.10
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.32
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.50
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.05
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ 0.01
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.03
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.01
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.34
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.30
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.06
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ (0.12
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.08
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.11
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.03
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.29
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.03
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ (0.02
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.01
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.08
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.07
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.31
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.09
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ (0.03
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.10
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.10
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.14
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ 0.11
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.07
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.28
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.15
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.08
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.23
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ (0.19
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.08
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.07
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.14
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.68
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ (0.10
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.02
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.40
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.13
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.19
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ (0.40
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.73
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.27
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.33
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (2.39
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ (0.57
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 52
+
+ Table of Contents
+
+ 
+ 
+
+ 
+ 
+
+ Name of Pool:
+
+ 
+ 
+ 
+ Transamerica American Funds Managed Risk VP Fund*
+
+ 
+ 
+
+ 
+ 
+ Type of Pool:
+
+ 
+ 
+ 
+ Mutual Fund
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ May 1, 2015
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value as of October 31, 2021:
+
+ 
+ 
+ 
+ $1,107,078,769
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value per share as of October 31, 2021:
+
+ 
+ 
+ 
+ $13.14
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -6.06% (March 2020)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -10.24% (December 2019 to March 2020)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ (2.49
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.87
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.36
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.63
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.25
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.84
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ (0.11
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.41
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.59
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.21
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.21
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.95
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ 3.09
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.66
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.65
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.35
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (6.06
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.16
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ 0.62
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.84
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.22
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.55
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.34
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ 1.03
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.11
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.06
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.91
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.90
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.26
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ 0.51
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.28
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.26
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.89
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.18
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.54
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ 1.82
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.17
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.96
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.95
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.62
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ 0.06
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.68
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.52
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.27
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.20
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.57
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ 0.30
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.08
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.09
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.63
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.77
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (3.51
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (1.00
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.51
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.93
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.69
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.81
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 4.11
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ 1.71
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.35
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.83
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 5.88
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ 0.79
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.87
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.76
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.23
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.30
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ 6.41
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 14.62
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (5.82
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 17.81
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.29
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 11.55
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 
+ 
+
+ Name of Pool:
+
+ 
+ 
+ 
+ Transamerica Morgan Stanley Global Allocation Managed Risk Balanced*
+
+ 
+ 
+
+ 
+ 
+ Type of Pool:
+
+ 
+ 
+ 
+ Mutual Fund
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ November 10, 2014
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value as of October 31, 2021:
+
+ 
+ 
+ 
+ $303,655,270
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value per share as of October 31, 2021:
+
+ 
+ 
+ 
+ $10.20
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -6.21% (March 2020)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -10.83% (January 2018 to December 2018)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ (2.61
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.58
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.44
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.44
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.58
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ (0.86
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.56
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.52
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.86
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.78
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.87
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ 2.27
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.77
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.81
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.96
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (6.21
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.58
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ 0.63
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.20
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.72
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.79
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.98
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.05
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ (0.10
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.40
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.31
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (2.69
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.29
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.76
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ (1.05
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.21
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.31
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.83
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.59
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.91
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ 1.70
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.80
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.66
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.31
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.60
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.37
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ 0.14
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.35
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.22
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.03
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.53
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.62
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ 0.11
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.52
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.51
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.64
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.06
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (2.30
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (0.91
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.62
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.65
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.11
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.16
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.96
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ 0.11
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.24
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.54
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.13
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 6.48
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ 1.03
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.61
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.80
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.24
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.59
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ 0.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 12.51
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (7.76
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 14.71
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 6.49
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 6.67
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 53
+
+ Table of Contents
+
+ 
+ 
+
+ 
+ 
+
+ Name of Pool:
+
+ 
+ 
+ 
+ American Funds Insurance Series Managed Risk Asset Allocation*
+
+ 
+ 
+
+ 
+ 
+ Type of Pool:
+
+ 
+ 
+ 
+ Mutual Fund
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ September 28, 2012
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value as of October 31, 2021:
+
+ 
+ 
+ 
+ $2,844,617,349
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value per share as of October 31, 2021:
+
+ 
+ 
+ 
+ $15.21
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -5.23% (March 2020)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -9.49% (December 2019 to March 2020)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ (2.73
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.91
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.31
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.52
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.07
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.79
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ (0.09
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.42
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.21
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.42
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.97
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ 3.34
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.72
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.33
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.47
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (5.23
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.00
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ 0.76
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.87
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.22
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.28
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.60
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.22
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ 1.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.18
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.35
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.87
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.32
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.36
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ 0.94
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.27
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.30
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.36
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.62
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ 2.07
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.20
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.18
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.01
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.31
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.67
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ 0.08
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.62
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.61
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.31
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.41
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.54
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ 0.34
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.15
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.15
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.77
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.67
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (3.43
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (0.93
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.51
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.91
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.61
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.09
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.89
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ 1.78
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.45
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.87
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.11
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 5.68
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ 0.77
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.89
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.29
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.30
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.36
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ 7.57
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 15.06
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.63
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 18.25
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 6.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 11.40
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 
+ 
+
+ Name of Pool:
+
+ 
+ 
+ 
+ American Funds Insurance Series Managed Risk Growth*
+
+ 
+ 
+
+ 
+ 
+ Type of Pool:
+
+ 
+ 
+ 
+ Mutual Fund
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ May 1, 2013
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value as of October 31, 2021:
+
+ 
+ 
+ 
+ $616,235,748
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value per share as of October 31, 2021:
+
+ 
+ 
+ 
+ $18.99
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -6.64% (October 2018)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -9.29% (August 2018 to December 2018)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ (4.96
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 4.11
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 6.43
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 5.20
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.32
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.12
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ (1.47
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.78
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.55
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.62
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.77
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.58
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ 2.60
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.57
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.84
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.44
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.57
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.12
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ 1.45
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.32
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.05
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.47
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 5.82
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.26
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ 1.07
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.52
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.23
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.61
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.86
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.88
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ (1.22
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.08
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.27
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 5.23
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.97
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.25
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ 2.96
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.93
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.62
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.79
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.67
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.96
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ 0.19
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.57
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.88
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.25
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 7.64
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.79
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ 1.24
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.21
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.48
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (3.14
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (3.32
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (1.70
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.43
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (6.64
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.43
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.33
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 6.81
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ 2.31
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.39
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.63
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.01
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 8.69
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ 0.66
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.69
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.45
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.64
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 5.31
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ 2.89
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 26.23
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.04
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 22.01
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 32.45
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 15.27
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 54
+
+ Table of Contents
+
+ 
+ 
+
+ 
+ 
+
+ Name of Pool:
+
+ 
+ 
+ 
+ American Funds Insurance Series Managed Risk Growth Income*
+
+ 
+ 
+
+ 
+ 
+ Type of Pool:
+
+ 
+ 
+ 
+ Mutual Fund
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ May 1, 2013
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value as of October 31, 2021:
+
+ 
+ 
+ 
+ $2,691,545,506
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value per share as of October 31, 2021:
+
+ 
+ 
+ 
+ $15.69
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -5.97% (October 2018)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -8.72% (September 2018 to December 2018)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ (3.64
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.07
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 5.61
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.92
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.15
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.71
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ (0.09
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.54
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.29
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.97
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.88
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.51
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ 3.23
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.51
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.86
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.93
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.61
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.12
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ 1.25
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.94
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.47
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.67
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.88
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ 0.88
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.18
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.73
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.24
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.23
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.80
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ (1.30
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.57
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 5.18
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.66
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.96
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ 2.49
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.36
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.62
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.86
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.68
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ 0.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.60
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.27
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.00
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 4.19
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.05
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ 0.84
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.12
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.70
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.23
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.29
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (3.62
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (1.66
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.83
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (5.97
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.63
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.57
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 4.70
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ 3.09
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.28
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.40
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.05
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 5.82
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ 1.07
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.96
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.27
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.31
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.13
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ 6.49
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 20.64
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.66
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 19.14
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 9.85
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 13.93
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 
+ 
+
+ Name of Pool:
+
+ 
+ 
+ 
+ American Funds Insurance Series Managed Risk International*
+
+ 
+ 
+
+ 
+ 
+ Type of Pool:
+
+ 
+ 
+ 
+ Mutual Fund
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ May 1, 2013
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value as of October 31, 2021:
+
+ 
+ 
+ 
+ $164,639,268
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value per share as of October 31, 2021:
+
+ 
+ 
+ 
+ $11.05
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -10.67% (March 2020)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -17.08% (December 2019 to March 2020)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ (4.01
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 4.39
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.44
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.68
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.63
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.63
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ (0.66
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.86
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.66
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.14
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.66
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.74
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ 2.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.21
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.44
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (10.67
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.71
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ 0.65
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.21
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.53
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.40
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.19
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.57
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ 0.32
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.11
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.09
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.70
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.93
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.24
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ (1.70
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.07
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.29
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 5.57
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.49
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.42
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ 2.27
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.93
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.82
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.06
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.59
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.39
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ 1.22
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.38
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.98
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.95
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.62
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.82
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ 0.99
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.51
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.46
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.59
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.04
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (2.39
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (1.41
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.51
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (6.74
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.93
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.10
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ (1.21
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.45
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.29
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.23
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 9.58
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ (1.00
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.44
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.77
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.19
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 5.23
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ (2.59
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 29.28
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (10.11
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 17.91
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.13
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 0.64
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 55
+
+ Table of Contents
+
+ 
+ 
+
+ 
+ 
+
+ Name of Pool:
+
+ 
+ 
+ 
+ American Funds Insurance Series Managed Risk Blue Chip Income and Growth*
+
+ 
+ 
+
+ 
+ 
+ Type of Pool:
+
+ 
+ 
+ 
+ Mutual Fund
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ May 1, 2013
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value as of October 31, 2021:
+
+ 
+ 
+ 
+ $369,657,833
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value per share as of October 31, 2021:
+
+ 
+ 
+ 
+ $12.05
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -6.38% (May 2019)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -13.07% (December 2019 to March 2020)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ (0.74
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.14
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.91
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.95
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.92
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.27
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ 1.31
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.01
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.58
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.74
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (5.60
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.77
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ 4.05
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.25
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (3.17
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.31
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (6.12
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.04
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ 1.86
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.16
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.32
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.09
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.74
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.36
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ (0.78
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.17
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (6.38
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.22
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.23
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ 0.94
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.59
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 5.14
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.51
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.32
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ 2.63
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.55
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.18
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.57
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.32
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ (0.88
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (1.49
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.56
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.33
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.43
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.63
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ 0.71
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.61
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.72
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.81
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.76
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (3.37
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (2.13
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.14
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (5.54
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.25
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.37
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 4.81
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ 4.53
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.73
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.01
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.27
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 6.79
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ 1.70
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.33
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.41
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.74
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.44
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ 13.77
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 15.48
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (6.99
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 14.14
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.93
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 13.77
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 
+ 
+
+ Name of Pool:
+
+ 
+ 
+ 
+ American Funds Insurance Series Portfolio Series Managed Risk Growth and Income*
+
+ 
+ 
+
+ 
+ 
+ Type of Pool:
+
+ 
+ 
+ 
+ Mutual Fund
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ May 1, 2015
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value as of October 31, 2021:
+
+ 
+ 
+ 
+ $1,523,069,888
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value per share as of October 31, 2021:
+
+ 
+ 
+ 
+ $12.66
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -6.03% (March 2020)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -10.91% (December 2019 to March 2020)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ (2.14
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.07
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.58
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.03
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.26
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.78
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ (0.11
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.92
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.78
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.70
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.95
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.13
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ 3.28
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.19
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.25
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.67
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (6.03
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.64
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ 0.63
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.28
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.09
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.10
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.11
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.13
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ 0.42
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.03
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.63
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.49
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.17
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.99
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ (0.10
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.12
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.77
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.08
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.73
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ 1.99
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.82
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.95
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.09
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.89
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ (0.21
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.66
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.64
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.46
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.26
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.69
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ 0.62
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.93
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.18
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.61
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (3.33
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (1.84
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.39
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (5.24
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.94
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.41
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.77
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ 0.21
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.19
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.86
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.17
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 6.64
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ 1.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.59
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.04
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.86
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.55
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ 3.70
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 16.55
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.72
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 19.29
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.96
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 10.13
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 56
+
+ Table of Contents
+
+ 
+ 
+
+ 
+ 
+
+ Name of Pool:
+
+ 
+ 
+ 
+ American Funds Insurance Series Portfolio Series Managed Risk Global Allocation*
+
+ 
+ 
+
+ 
+ 
+ Type of Pool:
+
+ 
+ 
+ 
+ Mutual Fund
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ May 1, 2015
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value as of October 31, 2021:
+
+ 
+ 
+ 
+ $474,719,729
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value per share as of October 31, 2021:
+
+ 
+ 
+ 
+ $12.57
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -7.40% (March 2020)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -12.67% (December 2019 to March 2020)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ (2.81
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.46
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.89
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.67
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.95
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.77
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ (0.33
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.57
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.94
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.71
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.79
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.94
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ 3.13
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.75
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.53
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.77
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (7.40
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.51
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ 0.54
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.92
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.72
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.02
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.76
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.29
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ (0.11
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.38
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.14
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.59
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.06
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ (0.22
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.60
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.97
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 5.14
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.39
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.56
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ 2.59
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.23
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.95
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.98
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.97
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ 0.21
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.76
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.18
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (0.55
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.80
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.69
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ 0.84
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.04
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.18
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.18
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (3.71
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (1.98
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.49
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (5.75
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.03
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.86
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.03
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ (1.17
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.73
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.58
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.81
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 7.20
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ 0.54
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.64
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.90
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.84
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.89
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ 1.08
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 19.03
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (6.90
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 20.44
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 5.65
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 7.66
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 
+ 
+
+ Name of Pool:
+
+ 
+ 
+ 
+ American Funds Insurance Series Portfolio Series Managed Risk Growth*
+
+ 
+ 
+
+ 
+ 
+ Type of Pool:
+
+ 
+ 
+ 
+ Mutual Fund
+
+ 
+ 
+
+ 
+ 
+ Date of Inception of Trading:
+
+ 
+ 
+ 
+ May 1, 2015
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value as of October 31, 2021:
+
+ 
+ 
+ 
+ $2,009,035,427
+
+ 
+ 
+
+ 
+ 
+ Net Asset Value per share as of October 31, 2021:
+
+ 
+ 
+ 
+ $13.98
+
+ 
+ 
+
+ 
+ 
+ Worst Monthly Loss:
+
+ 
+ 
+ 
+ -6.28% (October 2018)
+
+ 
+ 
+
+ 
+ 
+ Worst Peak-to-Valley Loss:
+
+ 
+ 
+ 
+ -10.07% (January 2020 to March 2020)
+
+ 
+ 
+
+ 
+ Rate of Return:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2016
+
+ 
+ 
+ 
+ 2017
+
+ 
+ 
+ 
+ 2018
+
+ 
+ 
+ 
+ 2019
+
+ 
+ 
+ 
+ 2020
+
+ 
+ 
+ 
+ 2021
+
+ 
+ 
+
+ 
+ 
+ January
+
+ 
+ 
+ 
+ (3.73
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.87
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.75
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.18
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.09
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.32
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ February
+
+ 
+ 
+ 
+ (0.33
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.69
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.59
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.96
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.13
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.52
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ March
+
+ 
+ 
+ 
+ 3.33
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.98
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (1.42
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.74
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (6.19
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.55
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ April
+
+ 
+ 
+ 
+ 1.07
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.36
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.36
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.07
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.31
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.45
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ May
+
+ 
+ 
+ 
+ 0.43
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.53
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.97
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (4.23
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 3.30
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.23
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ June
+
+ 
+ 
+ 
+ (0.53
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 0.43
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.29
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 5.12
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.55
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.05
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ July
+
+ 
+ 
+ 
+ 2.66
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.03
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.46
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.57
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.97
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ August
+
+ 
+ 
+ 
+ 0.31
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.38
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.35
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (0.92
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 4.57
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 2.37
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ September
+
+ 
+ 
+ 
+ 0.93
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.42
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.09
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.31
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ (3.47
+
+ 
+ 
+ )%
+
+ 
+ 
+
+ 
+ 
+ October
+
+ 
+ 
+ 
+ (1.74
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 1.68
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (6.28
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.23
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (2.02
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 4.64
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ November
+
+ 
+ 
+ 
+ 1.25
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 1.37
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.94
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 3.18
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 7.61
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ December
+
+ 
+ 
+ 
+ 0.44
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 0.95
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.48
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 2.38
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 4.17
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Annual
+
+ 
+ 
+ 
+ 3.97
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 18.00
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ (3.98
+
+ 
+ 
+ )%
+
+ 
+ 
+ 
+ 19.27
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 13.35
+
+ 
+ 
+ %
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Year-to-date
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 12.42
+
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS
+
+ 
+
+ 57
+
+ Table of Contents
+
+ 
+ MANAGEMENT S DISCUSSION AND ANALYSIS OF
+FINANCIAL CONDITION AND RESULTS OF OPERATIONS
+
+ The Funds are newly formed and have no operating history.
+
+ CHARGES
+
+ Breakeven Tables
+
+ The projected twelve month breakeven analysis for the Funds is set forth in the Breakeven Tables below. For purposes of calculating the amounts in the Breakeven Tables for the Funds, the analysis assumes that the constant NAV is equal to the amount shown. This amount is the expected NAV of the Shares on the first day of the Funds operations.
+
+ Dollar Amount and Percentage of Expenses
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ -1x Short VIX Futures 
+ETF (SVIX)
+
+ 
+ 
+
+ 
+ 
+ Expenses(1)
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ Selling price per share
+
+ 
+ 
+ 
+ 15.00
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Management fee
+
+ 
+ 
+ 
+ 0.20
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1.35
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Brokerage commissions and fees(2)
+
+ 
+ 
+ 
+ 0.08
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 0.51
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Variable create/redeem fees(3)
+
+ 
+ 
+ 
+ (0.03
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (0.17
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Other expenses(4)
+
+ 
+ 
+ 
+ 0.04
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 0.29
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Total fees and expenses
+
+ 
+ 
+ 
+ 0.30
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1.98
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Interest income(5)
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Amount of trading income required for the NAV at the end of one year to equal the initial selling price per share (12-Month breakeven)(6)
+
+ 
+ 
+ 
+ 0.30
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1.98
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ 2x Long VIX Futures 
+ETF (UVIX)
+
+ 
+ 
+
+ 
+ 
+ Expenses(1)
+
+ 
+ 
+ 
+ $
+
+ 
+ 
+ 
+ %
+
+ 
+ 
+
+ 
+ 
+ Selling price per share
+
+ 
+ 
+ 
+ 15.00
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Management fee
+
+ 
+ 
+ 
+ 0.25
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1.65
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Brokerage commissions and fees(2)
+
+ 
+ 
+ 
+ 0.15
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 1.01
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Variable create/redeem fees(3)
+
+ 
+ 
+ 
+ (0.03
+
+ 
+ 
+ )
+
+ 
+ 
+ 
+ (0.17
+
+ 
+ 
+ )
+
+ 
+ 
+
+ 
+ 
+ Other expenses(4)
+
+ 
+ 
+ 
+ 0.04
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 0.29
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Total fees and expenses
+
+ 
+ 
+ 
+ 0.42
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2.78
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Interest income(5)
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 0.00
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ Amount of trading income required for the NAV at the end of one year to equal the initial selling price per share (12-Month breakeven)(6)
+
+ 
+ 
+ 
+ 0.42
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2.78
+
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ ____________
+(1) The breakeven analysis set forth in this table assumes that the Shares have a constant NAV equal to the amount shown. This amount is the expected NAV of the Shares on the first day of Fund operations. The actual NAV of the Fund differs and is likely to change on a daily basis. The numbers provided in this chart have been rounded to the nearest 0.01. The breakeven analysis reflects all fees and expenses, including estimated rebalancing expenses that are anticipated to be incurred by the Fund during a year of an investor s investment.
+ (2) The expenses detailed in the table above include the cost of rolling futures positions and daily rebalancing.
+
+ (3) Authorized Participants are generally required to pay variable create and redeem fees of up to 0.20% of the value of each order they place. These variable transaction fees offset brokerage commissions incurred by the Fund and are reflected in Brokerage commissions and fees. Please see Creation and Redemption of Shares Creation and Redemption Transaction Fee. 
+
+ (4) Other Fund Fees and Expenses are an estimate based on an allocation to the Fund of the total estimated expenses anticipated to be incurred by the Trust on behalf of the Fund, net of any expenses or sponsor fee waived by the Sponsor, and include: Professional fees (primarily legal, auditing and tax-preparation related costs); Custodian and Administrator fees and expenses, Distribution and Marketing fees (primarily fees paid to the Marketing Agent, costs related to regulatory compliance activities and other costs related to the trading activities of the Fund); Business Permits and Licenses; General and Administrative expenses (primarily insurance and printing), and Other Expenses. The expenses presented are based 
+ 
+
+ 58
+
+ Table of Contents
+
+ 
+ on estimated expenses for the current fiscal year, and do not represent the maximum amounts payable under the contracts with third-party service providers. The per-share cost of these fixed or estimated fees has been calculated assuming that the Fund has $100 million in assets. The Sponsor has assumed an asset level of $100 million because: i) it believes that is an asset level where exchange traded investment products typically become viable over the long term; and ii) the Principals of the Sponsor have, based on their previous experience advising and monitoring exchange-traded funds, a reasonable expectation that the Fund will gather at least $100 million in its first year of operations. The Sponsor believes that this is a conservative assumption and larger AUM levels are expected to reduce the 12-Month Breakeven. The Sponsor can elect to pay (or waive reimbursement for) certain fees or expenses that would generally be paid by the Fund, although it has no contractual obligation to do so. Any election to pay or waive reimbursement for fees and expenses that would generally be paid by the Fund can be changed at the discretion of the Sponsor.
+ (5) Based on applying the average three month Treasury Bill rate for the quarter ended December 31, 2021. 
+
+ (6) Investors may pay customary brokerage commissions in connection with purchases of the Shares. Because such brokerage commission rates will vary from investor to investor, such brokerage commissions have not been included in each Breakeven Table. Investors are encouraged to review the terms of their brokerage accounts for applicable charges. The breakeven amount reflected in the Breakeven Table reflects the breakeven amount for investors in the secondary market. The breakeven amount for each Authorized Participant is equal to the sum of the breakeven amount for the Fund plus the amount of transaction fees paid by each Authorized Participant for the Fund. This amount includes Fund organization and operating expenses that the Fund will accrue on an amortized, straight-line basis over the Fund s first 12 months of operations.
+ Management Fee
+
+ SVIX pays the Sponsor a management fee (the Management Fee ), monthly in arrears, in an amount equal to 1.35% per annum of its average daily net assets. UVIX pays the Sponsor a Management Fee, monthly in arrears, in an amount equal to 1.65% per annum of its average daily net assets. Average daily net assets is calculated by dividing the month-end net assets of each Fund by the number of calendar days in such month.
+
+ No other Management Fee is paid by the Funds. The Management Fee is paid in consideration of the Sponsor s trading advisory services and the other services provided to the Fund that the Sponsor pays directly.
+
+ Licensing and Index Calculation Fee
+
+ Each Fund pays CBOE a fee to calculate and maintain the Index. Each Fund pays S&P a fee for the futures data that is based on the VIX and the use of third party licensor trademarks.
+
+ Recurring and Non-Recurring Fees and Expenses
+
+ Each Fund pays all of its fees and expenses, including recurring, non-recurring, routine and unusual fees and expenses.
+
+ Selling Commission
+
+ Retail investors may purchase and sell Shares through traditional brokerage accounts. Investors are expected to be charged a customary commission by their brokers in connection with purchases of Shares that will vary from investor to investor. Investors are encouraged to review the terms of their brokerage accounts for applicable charges. The price at which an Authorized Participant sells a Share may be higher or lower than the price paid by such Authorized Participant in connection with the creation of such Share in a Creation Unit.
+
+ Brokerage Commissions and Fees
+
+ Each Fund pays all of its respective brokerage commissions, including applicable exchange fees, NFA fees and give-up fees, pit brokerage fees and other transaction related fees and expenses charged in connection with trading activities for the Fund s investments in CFTC regulated investments. On average, total charges paid to FCMs are expected to be less than $7.00 per round-turn trade, although brokerage commissions and trading fees are determined on a contract-by-contract basis. Each Fund bears other transaction costs including the effects of trading spreads and financing costs/fees, if any, associated with the use of Financial Instruments, and costs relating to the purchase of U.S. Treasury securities or similar high credit quality short-term fixed-income or similar securities (such as shares of money market funds).
+ 
+
+ 59
+
+ Table of Contents
+
+ 
+ MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS
+
+ The following discussion describes the material U.S. federal (and certain state and local) income tax considerations associated with the purchase, ownership and disposition of Shares as of the date hereof by U.S. Shareholders (as defined below) and non-U.S. Shareholders (as defined below). Except where noted, this discussion deals only with Shares held as capital assets by shareholders who acquired Shares by purchase and does not address special situations, such as those of:
+
+ dealers in securities or commodities;
+
+ financial institutions;
+
+ regulated investment companies;
+
+ real estate investment trusts;
+
+ partnerships and persons in their capacity as partners;
+
+ tax-exempt organizations;
+
+ insurance companies;
+
+ persons holding Shares as a part of a hedging, integrated or conversion transaction or a straddle;
+
+ accrual method taxpayers subject to special tax accounting rules as a result of their use of financial statements;
+
+ traders in securities that elect to use a mark-to-market method of accounting for their securities holdings; or
+
+ persons liable for alternative minimum tax.
+
+ Furthermore, the discussion below is based upon the provisions of the Code, the Regulations, and administrative and judicial interpretations thereof, all as of the date hereof, and such authorities may be repealed, revoked, modified or subject to differing interpretations, possibly on a retroactive basis, so as to result in U.S. federal income tax consequences different from those described below.
+
+ A U.S. Shareholder of Shares means a beneficial owner of Shares that is for U.S. federal income tax purposes:
+
+ an individual that is a citizen or resident of the United States;
+
+ a corporation (or other entity taxable as a corporation) created or organized in or under the laws of the United States, any state thereof or the District of Columbia;
+
+ an estate the income of which is subject to U.S. federal income taxation regardless of its source; or
+
+ a trust if it (1) is subject to the primary supervision of a court within the United States and one or more U.S. persons have the authority to control all substantial decisions of such trust or (2) has a valid election in effect under applicable Regulations to be treated as a U.S. person.
+
+ A non-U.S. Shareholder of Shares means a beneficial owner of Shares that is for U.S. federal income tax purposes:
+
+ an individual that is a non-resident alien;
+
+ a foreign corporation;
+
+ a foreign estate; or
+
+ a foreign trust.
+
+ 
+
+ 60
+
+ Table of Contents
+
+ 
+ If a partnership or other entity or arrangement treated as a partnership for U.S. federal income tax purposes holds Shares, the tax treatment of a partner will generally depend upon the status of the partner and the activities of the partnership. If an investor is a partner of a partnership holding Shares, the Trust urges such investor to consult its own tax advisor.
+
+ No statutory, administrative or judicial authority directly addresses the treatment of Shares or instruments similar to Shares for U.S. federal income tax purposes. As a result, the Trust cannot assure investors that the IRS or the courts will agree with the tax consequences described herein. A different treatment from that described below could adversely affect the amount, timing and character of income, gain or loss in respect of an investment in the Shares.
+
+ If an investor is considering the purchase of Shares, the Trust urges investors to consult their own tax advisor concerning the particular U.S. federal income tax consequences to investors of the purchase, ownership and disposition of Shares, as well as any consequences to investors arising under the laws of any other taxing jurisdiction.
+
+ Status of the Funds
+
+ Under Section 7704 of the Code, unless certain exceptions apply, a publicly traded partnership is generally treated and taxed as a corporation, and not as a partnership, for U.S. federal income tax purposes. A partnership is a publicly traded partnership if (1) interests in the partnership are traded on an established securities market or (2) interests in the partnership are readily tradable on a secondary market or the substantial equivalent thereof. Each Fund is a publicly traded partnership. If 90% or more of the income of a publicly traded partnership during each taxable year consists of qualifying income and the partnership is not required to register under the 1940 Act, it will be treated as a partnership, and not as an association or publicly traded partnership taxable as a corporation, for U.S. federal income tax purposes (the qualifying income exception ). Qualifying income includes dividends, interest, capital gains from the sale or other disposition of stocks and debt instruments and, in the case of a partnership a principal activity of which is the buying and selling of commodities or certain positions with respect to commodities, income and gains derived from certain swap agreements or regulated futures or forward contracts with respect to commodities. Each Fund anticipates that at least 90% of its gross income for each taxable year will constitute qualifying income within the meaning of Section 7704(d) of the Code.
+ Chapman and Cutler LLP has acted as counsel to the Trust in connection with this registration statement. Under current law and assuming full compliance with the terms of the Trust Agreement (and other relevant documents) and based on factual representations made by the Funds, in the opinion of Chapman and Cutler LLP, each Fund is classified as a partnership for U.S. federal income tax purposes. The factual representations upon which Chapman and Cutler LLP has relied are: (1) each Fund has not elected and will not elect to be treated as a corporation for U.S. federal income tax purposes; and (2) for each taxable year, 90% or more of the Fund s gross income has been and is expected to continue to be qualifying income. Shareholders should be aware that opinions of counsel are not binding on the IRS, and no assurance can be given that the IRS will not challenge the conclusions set forth in such opinion. The Sponsor will use its best efforts to operate a Fund in such manner as is necessary for the Fund to continue to meet the qualifying income exception.
+ While it is expected that each Fund will operate so that it will qualify to be treated for U.S. federal income tax purposes as a partnership, and not as an association or a publicly traded partnership taxable as a corporation, given the highly complex nature of the rules governing partnerships, the ongoing importance of factual determinations, the lack of direct guidance with respect to the application of tax laws to the activities a Fund is undertaking and the possibility of future changes in the Fund s circumstances, it is possible that the Fund will not so qualify for any particular year. Chapman and Cutler LLP has no obligation to advise the Fund or its shareholders of any subsequent change in the matters stated, represented or assumed, or of any subsequent change in the applicable law. Each Fund s taxation as a partnership depends on the Fund s ability to meet, on a continuing basis, through actual operating results, the qualifying income exception, the compliance of which will not be reviewed by Chapman and Cutler LLP. Accordingly, no assurance can be given that the actual results of the Fund s operations for any taxable year will satisfy the qualifying income exception.
+ 
+
+ 61
+
+ Table of Contents
+
+ 
+ If for any reason a Fund becomes taxable as a corporation for U.S. federal income tax purposes, the Fund s items of income and deduction would not pass through to the Fund s shareholders and shareholders would be treated for U.S. federal income tax purposes as stockholders in a corporation. Each Fund would be required to pay income tax at corporate rates on its net income. Distributions by a Fund to the shareholders would constitute dividend income taxable to such shareholders, to the extent of the Fund s earnings and profits, and the payment of these distributions would not be deductible by the Fund. These consequences would have a material adverse effect on a Fund, the Fund s shareholders and the value of the Shares.
+ If at the end of any taxable year a Fund fails to meet the qualifying income exception, the Fund may still qualify as a partnership if the Fund is entitled to relief under the Code for an inadvertent termination of partnership status. This relief will be available if (1) the failure is cured within a reasonable time after discovery, (2) the failure is determined by the IRS to be inadvertent, and (3) a Fund agrees to make such adjustments or to pay such amounts as are determined by the IRS. It is not possible to state whether a Fund would be entitled to this relief in any or all circumstances. It also is not clear under the Code whether this relief is available for the Fund s first taxable year as a publicly traded partnership. If this relief provision is not applicable to a particular set of circumstances involving a Fund, it will not qualify as a partnership for U.S. federal income tax purposes. Even if this relief provision applies and a Fund retains its partnership qualification, the Fund or its shareholders (during the failure period) will be required to pay such amounts as determined by the IRS.
+ The remainder of this discussion assumes that a Fund qualifies to be taxed as a partnership for U.S. federal income tax purposes.
+
+ U.S. Shareholders
+
+ Treatment of Fund Income
+
+ A partnership generally does not incur U.S. federal income tax liability. Instead, each partner of a partnership is required to take into account its share of items of income, gain, loss, deduction and other items of the partnership. Accordingly, each shareholder in a Fund is required to include in income its allocable share of the Fund s income, gain, loss, deduction and other items for the Fund s taxable year ending with or within its taxable year. In computing a partner s U.S. federal income tax liability, such items must be included, regardless of whether cash distributions are made by the partnership. Thus, shareholders in a Fund may be required to take into account taxable income without a corresponding current receipt of cash if the Fund generates taxable income but does not make cash distributions in an amount equal to, or if the shareholder is not able to deduct, in whole or in part, such shareholder s allocable share of the Fund s expenses or capital losses. Each Fund s taxable year ends on December 31 unless otherwise required by law. The Fund uses the accrual method of accounting.
+ Shareholders must take into account their share of ordinary income realized by the Fund s investments, including from accruals of interest on the U.S. Treasury securities or other cash and cash equivalents held in the Fund s portfolio. The Fund may hold U.S. Treasury securities or other debt instruments with acquisition discount or original issue discount, in which case shareholders in the Fund are required to include accrued amounts in taxable income on a current basis even though receipt of those amounts may occur in a subsequent year. A Fund may also acquire U.S. Treasury securities with market discount. Upon disposition of such obligations, gain would generally be required to be treated as interest income to the extent of the market discount, and shareholders in the Fund would be required to include as ordinary income their share of such market discount that accrued during the period the obligations were held by the Fund. Income or loss from transactions involving certain derivative instruments, such as periodic and certain non-periodic payments in swap transactions, will also generally constitute ordinary income or loss and may result in recognition of taxable income to a U.S. Shareholder on a current basis even though receipt of those amounts may occur in a subsequent year.
+ The character and timing of income that a Fund earns from the positions in its investment strategy depends on the particular U.S. federal income tax treatment of each such position. The U.S. federal income tax treatment of certain positions is not always clear, and the IRS and the U.S. Congress ( Congress ) sometimes take steps which change the manner in which certain positions are taxed. For example, the IRS has issued guidance indicating that a position that certain taxpayers were previously accounting for as prepaid forward contracts for U.S. federal income tax purposes should, instead, be accounted for under the U.S. federal income tax rules for non-dollar denominated debt instruments. The IRS has also released a Notice (the IRS Notice ) seeking comments from practitioners about 
+ 
+
+ 62
+
+ Table of Contents
+
+ 
+ the application of U.S. federal income tax rules to certain derivative positions, including derivative positions in commodities. The IRS Notice asks for comments about, among other questions, when investors in these positions should have income, the character of income and gain or loss from these positions and whether the U.S. federal constructive ownership rules should apply to these positions. It is not possible to predict what changes, if any, will be adopted or when any such changes would take effect. However, any such changes could affect the amount, timing and character of income, gain and loss in respect of a Fund s investments, possibly with retroactive effect. As a Fund passes through its items of income, gain and loss to shareholders, any change in the manner in which a Fund accounts for these items could have an adverse impact on the shareholders of the Fund.
+ The Code generally applies a mark-to-market system of taxing unrealized gains and losses on, and otherwise provides for special rules of taxation with respect to, Section 1256 Contracts (as defined herein). A Section 1256 Contract includes certain regulated futures contracts, certain non-equity options and certain non-U.S. currency forward contracts. The Sponsor expects substantially all of a Fund s futures contracts and foreign currency forward contracts to qualify as Section 1256 Contracts. Swap agreements and non-currency forward contracts are generally not Section 1256 Contracts. Section 1256 Contracts held by a Fund at the end of a taxable year of the Fund will be treated for U.S. federal income tax purposes as if they were sold by the Fund at its fair market value on the last Business Day of the taxable year. The net gain or loss, if any, resulting from these deemed sales (known as marking-to-market ), together with any gain or loss resulting from any actual sales of Section 1256 Contracts (or other termination of a Fund s obligations under such contracts), must be taken into account by the Fund in computing its taxable income for the year. If a Section 1256 Contract held by the Fund at the end of a taxable year is sold in the following year, the amount of any gain or loss realized on the sale will be adjusted to reflect the gain or loss previously taken into account under the mark-to-market rules.
+ Capital gains and losses from Section 1256 Contracts generally are characterized as short-term capital gains or losses to the extent of 40% of the gains or losses and as short-term capital gains or losses to the extent of 60% of the gains or losses. Shareholders of a Fund will generally take into account their pro rata share of the short-term capital gains and losses and short-term capital gains and losses from Section 1256 Contracts held by a Fund. If a non-corporate taxpayer incurs a net capital loss for a year, the portion of the loss, if any, which consists of a net loss on Section 1256 Contracts may, at the election of the taxpayer, be carried back three years. A loss carried back to a year by a non-corporate taxpayer may be deducted only to the extent (1) the loss does not exceed the net gain on Section 1256 Contracts for the year and (2) the allowance of the carryback does not increase or produce a net operating loss for the year. Due to a Fund s investment strategy, it is also likely that a significant portion of any capital gain or loss realized by the Fund with respect to non-Section 1256 Contracts will be short-term.
+ Allocation of a Fund s Gains and Losses
+
+ For U.S. federal income tax purposes, a shareholder s distributive share of a Fund s income, gain, loss, deduction and other items is determined by the Trust Agreement, unless an allocation under the agreement does not have substantial economic effect, in which case the allocations will be determined in accordance with the partners interests in the partnership. Subject to the discussions below under Monthly Allocation and Revaluation Conventions and Section 754 Election, the allocations pursuant to the Trust Agreement should be considered to have substantial economic effect or deemed to be made in accordance with the partners interests in the partnership.
+ If the allocations provided by the Trust Agreement were successfully challenged by the IRS, the amount of income or loss allocated to shareholders for U.S. federal income tax purposes under the agreement could be increased or reduced, or the character of the income or loss could be modified.
+
+ As described in more detail below, the U.S. tax rules that apply to partnerships are complex and their application is not always clear. Additionally, the rules generally were not written for, and in some respects are difficult to apply to, publicly traded partnerships. Each Fund applies certain assumptions and conventions intended to comply with the intent of the rules and to report income, gain, deduction, loss and credit to shareholders in a manner that reflects the economic gains and losses, but these assumptions and conventions may not comply with all aspects of the applicable Regulations. It is possible, therefore, that the IRS will successfully assert that assumptions made and/or conventions used do not satisfy the technical requirements of the Code or the Regulations and will require that tax items be adjusted or reallocated in a manner that could adversely impact an investor.
+ 
+
+ 63
+
+ Table of Contents
+
+ 
+ Monthly Allocation and Revaluation Conventions
+
+ In general, a Fund s taxable income and losses are determined monthly and are apportioned among the shareholders of the Fund in proportion to the number of Shares treated as owned by each of them as of the close of the last trading day of the preceding month; provided, however, such items for the period beginning on the closing date and ending on the last day of the month in which the option closing date or the expiration of the over-allotment option occurs shall be allocated to the shareholders as of the opening of the Exchange on the first Business Day of the next succeeding month. By investing in Shares, a U.S. Shareholder agrees that, in the absence of an administrative determination or judicial ruling to the contrary, it will report income and loss under the monthly allocation and revaluation conventions described below, except for the period beginning on the closing date and ending on the last day of the month in which the option closing date or the expiration of the over-allotment option occurs, in which case the allocation shall take place as described above.
+ Under the monthly allocation convention, whoever is treated for U.S. federal income tax purposes as holding Shares as of the close of the last trading day of the preceding month will be treated as continuing to hold the Shares until immediately before the close of the last trading day of the following month. For the initial month of a Fund s operations, the shareholders at the close of trading at month-end received that month s allocation. As a result, a holder who has disposed of Shares prior to the close of the last trading day of a month may be allocated income, gain, loss and deduction realized after the date of transfer.
+ The Code generally requires that items of partnership income and deductions be allocated between transferors and transferees of partnership interests on a daily basis. It is possible that transfers of Shares could be considered to occur for U.S. federal income tax purposes when the transfer is completed without regard to the Fund s monthly convention for allocating income and deductions. If this were to occur, a Fund s allocation method might be deemed to violate that requirement.
+
+ In addition, for any month in which a creation or redemption of Shares takes place, a Fund generally credits or debits, respectively, the book capital accounts of the holders of existing Shares with any unrealized gain or loss in the Fund s assets. This results in the allocation of items of a Fund s income, gain, loss, deduction and credit to existing holders of Shares to account for the difference between the tax basis and fair market value of property owned by the Fund at the time new Shares are issued or old Shares are redeemed, or the reverse section 704(c) allocations. The intended effect of these allocations is to allocate any built-in gain or loss in a Fund s assets at the time of a creation or redemption of Shares to the investors that economically have earned such gain or loss.
+ As with the other allocations described above, a Fund generally uses a monthly convention for purposes of the reverse section 704(c) allocations. More specifically, a Fund generally credits or debits, respectively, the book capital accounts of the holders of existing Shares with any unrealized gain or loss in the Fund s assets based on a calculation utilizing the creation/redemption price of the Fund s Shares during the month in which the creation or redemption transaction takes place, rather than the fair market value of its assets at the time of such creation or redemption (the revaluation convention ). As a result, it is possible that, for U.S. federal income tax purposes, (1) a purchaser of newly issued Shares will be allocated some or all of the unrealized gain in a Fund s assets at the time it acquires the Shares or (2) a purchaser of newly issued Shares will not be allocated its entire share in the loss in the Fund s assets accruing after the time of such acquisition. Furthermore, the applicable Regulations generally require that the book capital accounts will be adjusted based on the fair market value of partnership property on the date of adjustment and do not explicitly allow the adoption of a monthly revaluation convention. The Sponsor, in an attempt to eliminate book-tax disparities, allocates items of income, gain, or loss for U.S. federal income tax purposes among the shareholders under the principles of the remedial method of Section 1.704-3(d) of the Regulations.
+ The Code and applicable Regulations generally require that items of partnership income and deductions be allocated between transferors and transferees of partnership interests on a daily basis, and that adjustments to book capital accounts be made based on the fair market value of partnership property on the date of adjustment. The Code and Regulations do not contemplate monthly allocation or revaluation conventions.
+
+ If the IRS does not accept a Fund s monthly allocation or revaluation convention, the IRS may contend that taxable income or losses of the Fund must be reallocated among the shareholders. If such a contention were sustained, the holders respective tax liabilities would be adjusted to the possible detriment of certain holders. The Sponsor is authorized to revise a Fund s allocation and revaluation methods in order to comply with applicable law or to allocate items of partnership income and deductions in a manner that reflects more accurately the shareholders interests in the Fund.
+
+ 
+
+ 64
+
+ Table of Contents
+
+ 
+ Section 754 Election
+
+ Each Fund has made the election permitted by Section 754 of the Code. Such an election, once made, is irrevocable without the consent of the IRS. The making of such election by a Fund generally has the effect of requiring a purchaser of Shares in the Fund to adjust, utilizing the lowest closing price during the month, its proportionate share of the basis in the Fund s assets, or the inside basis, pursuant to Section 743(b) of the Code to fair market value (as reflected in the purchase price for the purchaser s Shares), as if it had acquired a direct interest in the Fund s assets. The Section 743(b) adjustment is attributed solely to a purchaser of Shares and is not added to the basis of a Fund s assets associated with all of the other shareholders. Depending on the relationship between a holder s purchase price for Shares and its unadjusted share of a Fund s inside basis at the time of the purchase, the Section 754 election may be either advantageous or disadvantageous to the holder as compared to the amount of gain or loss a holder would be allocated absent the Section 754 election.
+ The calculations under Section 754 of the Code are complex, and there is little legal authority concerning the mechanics of the calculations, particularly in the context of publicly traded partnerships. Therefore, in making the election under Section 754 of the Code, a Fund applies certain conventions in determining and allocating the Section 743 basis adjustments to help reduce the complexity of those calculations and the resulting administrative costs to the Fund. It is possible that the IRS will successfully assert that some or all of such conventions utilized by a Fund do not satisfy the technical requirements of the Code or the Regulations and, thus, will require different basis adjustments to be made.
+ In order to make the basis adjustments permitted by Section 754, a Fund is required to obtain information regarding each holder s secondary market transactions in Shares, as well as creations and redemptions of Shares. Each Fund seeks such information from the record holders of Shares, and, by purchasing Shares, each beneficial owner of Shares will be deemed to have consented to the provision of such information by the record owner of such beneficial owner s Shares. Notwithstanding the foregoing, however, there can be no guarantee that a Fund will be able to obtain such information from record owners or other sources, or that the basis adjustments that the Fund makes based on the information it is able to obtain will be effective in eliminating disparity between a holder s outside basis in its share of the Fund interests and its share of inside basis.
+ Treatment of Distributions
+
+ Distributions of cash by a partnership are generally not taxable to the distributee to the extent the amount of cash does not exceed the distributee s tax basis in its partnership interest. Thus, any cash distributions made by a Fund will be taxable to a shareholder only to the extent such distributions exceed the shareholder s tax basis in the partnership interests it is treated as owning. (See U.S. Shareholders Tax Basis in Shares below.) Any cash distributions in excess of a shareholder s tax basis generally will be considered to be gain from the sale or exchange of the Shares. See U.S. Shareholders Disposition of Shares below. Each Fund does not currently expect to make any cash distributions.
+ Creation and Redemption of Creation Units
+
+ Shareholders, other than Authorized Participants (or holders for which an Authorized Participant is acting), generally will not recognize gain or loss as a result of an Authorized Participant s creation or redemption of a Creation Unit. If a Fund disposes of assets in connection with the redemption of a Creation Unit, however, the disposition may give rise to gain or loss that will be allocated in part to investors. An Authorized Participant s creation or redemption of a Creation Unit may also affect an investor s share of a Fund s tax basis in its assets, which could affect the amount of gain or loss allocated to an investor on the sale or disposition of portfolio assets by a Fund.
+ Disposition of Shares
+
+ If a U.S. Shareholder transfers Shares of a Fund, in a sale or other taxable disposition, the U.S. Shareholder will generally be required to recognize gain or loss measured by the difference between the amount realized on the sale and the U.S. Shareholder s adjusted tax basis in the Shares. The amount realized will include the U.S. Shareholder s share of a Fund s liabilities, as well as any proceeds from the sale. The gain or loss recognized will generally be taxable as capital gain or loss.
+
+ 
+
+ 65
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+ Table of Contents
+
+ 
+ Capital gain of non-corporate U.S. Shareholders is eligible to be taxed at reduced rates when the Shares are held for more than one year. The maximum rate is currently 20%. Capital gain of corporate U.S. Shareholders is taxed at the same rate as ordinary income. Any capital loss recognized by a U.S. Shareholder on a sale of Shares will generally be deductible only against capital gains, except that a non-corporate U.S. Shareholder may generally also offset up to $3,000 per year of ordinary income.
+
+ Medicare Tax on Investment Income
+
+ Certain U.S. Shareholders that are individuals, estates or trusts must pay an additional 3.8% tax on their net investment income. U.S.
+
+ Shareholders should consult their own tax advisors regarding the effect, if any, of this tax on their investment in a Fund.
+
+ Tax Basis in Shares
+
+ A U.S. Shareholder s initial tax basis in the partnership interests it is treated as holding will equal the sum of (1) the amount of cash paid by such U.S. Shareholder for its Shares and (2) such U.S. Shareholder s share of a Fund s liabilities. A U.S. Shareholder s tax basis in the Shares will be increased by (1) the U.S. Shareholder s share of a Fund s taxable income, including capital gain, (2) the U.S. Shareholder s share of the Fund s income, if any, that is exempt from tax and (3) any increase in the U.S. Shareholder s share of the Fund s liabilities. A U.S. Shareholder s tax basis in Shares will be decreased (but not below zero) by (1) the amount of any cash distributed (or deemed distributed) to the U.S. Shareholder, (2) the U.S. Shareholder s share of the Fund s losses and deductions, (3) the U.S. Shareholder s share of the Fund s expenditures that is neither deductible nor properly chargeable to its capital account and (4) any decrease in the U.S. Shareholder s share of the Fund s liabilities.
+ Limitations on Deductibility of Certain Losses and Expenses
+
+ The deductibility for U.S. federal income tax purposes of a U.S. Shareholder s share of losses and expenses of a Fund is subject to certain limitations, including, but not limited to, rules providing that: (1) a U.S. Shareholder may not deduct the Fund s losses that are allocated to it in excess of its adjusted tax basis in its Shares; (2) individuals and personal holding companies may not deduct the losses allocable to a particular activity in excess of the amount that they are considered to have at risk with respect to the activity and (3) the ability of individuals to take certain itemized deductions (including the Management Fees) is suspended for taxable years 2018 through 2025. To the extent that a loss or expense that cannot be deducted currently is allocated to a U.S. Shareholder, such U.S. Shareholder may be required to report taxable income in excess of its economic income or cash distributions on the Shares. Prospective shareholders are urged to consult their own tax advisors with regard to these and other limitations on the ability to deduct losses or expenses with respect to an investment in a Fund.
+ Under Section 709(b) of the Code, amounts paid or incurred to organize a partnership may, at the election of the partnership, be treated as deferred expenses, which are allowed as a deduction ratably over a period of not less than 180 months. Each Fund has elected to treat such expenses as ratably deductible over 180 months, beginning with the month a Fund is considered to have started its investment activities for federal tax purposes. A non-corporate U.S. Shareholder s allocable share of such organizational expenses would constitute miscellaneous itemized deductions, which are not deductible for taxable years 2018 through 2025. Expenditures in connection with the issuance and marketing of Shares (so-called syndication fees ) are not eligible for the 180-month amortization provision and are not deductible.
+ Transferor/Transferee Allocations
+
+ In general, a Fund s taxable income and losses are determined monthly and are apportioned among the Fund s shareholders in proportion to the number of Shares owned by each of them as of the close of the last trading day of the preceding month; provided, however, such items for the period beginning on the closing date and ending on the last day of the month in which the option closing date or the expiration of the over-allotment option occurs shall be allocated to the shareholders as of the opening of the Exchange on the first Business Day of the next succeeding month. With respect to any Share that was not treated as outstanding as of the close of the last trading day of the preceding month, the first person that is treated as holding such Share (other than an underwriter or other person 
+ 
+
+ 66
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+ Table of Contents
+
+ 
+ holding in a similar capacity and except with respect to the period beginning on the closing date and ending on the last day of the month in which the option closing date or the expiration of the over-allotment option occurs) for U.S. federal income tax purposes will be treated as holding such Share for this purpose as of the close of the last trading day of the preceding month. As a result, a shareholder transferring its Shares may be allocated income, gain, loss and deduction realized after the date of transfer.
+
+ Section 706 of the Code generally requires that items of partnership income and deductions be allocated between transferors and transferees of partnership interests on a daily basis. It is possible that transfers of Shares could be considered to occur for U.S. federal income tax purposes when the transfer is completed without regard to a Fund s convention for allocating income and deductions. In that event, a Fund s allocation method might be considered a monthly convention that does not literally comply with that requirement.
+
+ If the IRS treats transfers of Shares as occurring throughout each month and a monthly convention is not allowed by the Regulations (or only applies to transfers of less than all of a shareholder s Shares), or if the IRS otherwise does not accept a Fund s convention, the IRS may contend that taxable income or losses of the Fund must be reallocated among the shareholders. If such a contention were sustained, the shareholders respective tax liabilities would be adjusted to the possible detriment of certain shareholders. The Sponsor is authorized to revise a Fund s methods of allocation between transferors and transferees (as well as among shareholders whose interests otherwise vary during a taxable period).
+ Tax Reporting by a Fund
+
+ Each Fund will file a partnership tax return with the IRS. Accordingly, tax information will be provided to shareholders on a Schedule K-1for each calendar year as soon as practicable after the end of such taxable year but generally not later than March 15. Each Schedule K-1 provided to a shareholder will set forth the shareholder s share of such Fund s tax items (i.e., income, gain, loss, deduction and other items) in a manner sufficient for a shareholder to complete its tax return with respect to its investment in the Fund s Shares. Each shareholder, by its acquisition of Shares, will be deemed to agree to allow brokers and nominees to provide to a Fund its name and address and the other information and forms as may be reasonably requested by a Fund for purposes of complying with their tax reporting and withholding obligations (and to waive any confidentiality rights with respect to the information and forms for this purpose) and to provide information or forms upon request. The beneficial owners who are of a type, as identified by the nominee through whom their Shares are held, that do not ordinarily have U.S. federal tax return filing requirements, collectively, Certain K-1 Unitholders, have designated the managing Owner as their tax agent (the Tax Agent ) in dealing with the Trust. In light of such designation and pursuant to Treasury Regulation section 1.6031(b)-1T(c), as amended from time to time, the Trust will provide to the Tax Agent Certain K-1 Unitholders statements (as such term is defined under Treasury Regulation section 1.6031(b)-1T(a)(3), as amended from time to time).
+ Given the lack of authority addressing structures similar to that of the Funds, it is not certain that the IRS will agree with the manner in which tax reporting by a Fund will be undertaken. Therefore, shareholders should be aware that future IRS interpretations or revisions to Regulations could alter the manner in which tax reporting by a Fund and any nominee will be undertaken.
+
+ Treatment of Securities Lending Transactions Involving Shares
+
+ A shareholder whose Shares are loaned to a short seller to cover a short sale of Shares may be considered as having disposed of those Shares. If so, such shareholder would no longer be a beneficial owner of a pro rata portion of the partnership interests with respect to those Shares during the period of the loan and may recognize gain or loss from the disposition. As a result, during the period of the loan, (1) any of a Fund s income, gain, loss, deduction or other items with respect to those Shares would not be reported by the shareholder, and (2) any cash distributions received by the shareholder as to those Shares could be fully taxable, likely as ordinary income. Accordingly, shareholders who desire to avoid the risk of income recognition from a loan of their Shares to a short seller are urged to modify any applicable brokerage account agreements to prohibit their brokers from borrowing their Shares.
+ 
+
+ 67
+
+ Table of Contents
+
+ 
+ Audits and Adjustments to Tax Liability
+
+ Under the Code, adjustments in tax liability with respect to a Fund s items generally will be made at the Fund level in a partnership proceeding rather than in separate proceedings with each shareholder. Pursuant to the Trust Agreement, the Sponsor will represent a Fund as the partnership representative of the Fund. A partnership s designated partnership representative has broad authority to resolve a partnership audit and any such resolution will be binding on all partners. Shareholders will have no statutory right to notice and will have no right to participate in the audit proceeding.
+
+ Underpayments of tax are determined and paid at the partnership level following any adjustment to the partnership s items of income, gain, loss, deduction or credit. Adjustments resulting from an IRS audit may require each shareholder to adjust a prior year s liability, and possibly may result in an audit of its return. Any audit of a shareholder s return could result in adjustments not related to a Fund s returns as well as those related to the Fund s returns.
+
+ Foreign Tax Credits
+
+ Subject to generally applicable limitations, and new rules enacted by the Tax Cuts and Jobs Act, U.S. Shareholders will be able to claim foreign tax credits with respect to certain foreign income taxes paid or incurred by a Fund, withheld on payments made to the Trust or paid by the Trust on behalf of Fund shareholders (if any of such foreign income taxes are so paid, incurred or withheld). U.S. Shareholders must include in their gross income, for U.S. federal income tax purposes, both their share of a Fund s items of income and gain and also their share of the amount which is deemed to be the shareholder s portion of foreign income taxes paid with respect to, or withheld from interest or other income derived by, the Fund. U.S. Shareholders may then subtract from their U.S. federal income tax the amount of such taxes withheld, or else treat such foreign taxes as deductions from gross income; however, as in the case of investors receiving income directly from foreign sources, the tax credit or deduction described above is subject to certain limitations. Even if the shareholder is unable to claim a credit, he or she must include all amounts described above in income. U.S. Shareholders are urged to consult their tax advisors regarding this election and its consequences to them.
+ Tax Shelter Disclosure Rules
+
+ There are circumstances under which certain transactions must be disclosed to the IRS in a disclosure statement attached to a taxpayer s U.S. federal income tax return. (A copy of such statement must also be sent to the IRS Office of Tax Shelter Analysis.) In addition, the Code imposes a requirement on certain material advisors to maintain a list of persons participating in such transactions, which list must be furnished to the IRS upon written request. These provisions can apply to transactions not conventionally considered to involve abusive tax planning. Consequently, it is possible that such disclosure could be required by a Fund or the shareholders (1) if a shareholder incurs a loss (in each case, in excess of a threshold computed without regard to offsetting gains or other income or limitations) from the disposition (including by way of withdrawal) of Shares, or (2) possibly in other circumstances. Furthermore, a Fund s material advisors could be required to maintain a list of persons investing in the Fund pursuant to the Code. While the tax shelter disclosure rules generally do not apply to a loss recognized on the disposition of an asset in which the taxpayer has a qualifying basis (generally a basis equal to the amount of cash paid by the taxpayer for such asset), such rules will apply to a taxpayer recognizing a loss with respect to interests in a pass-through entity (such as the Shares) even if its basis in such interests is equal to the amount of cash it paid. In addition, significant penalties may be imposed in connection with a failure to comply with these reporting requirements. U.S. Shareholders are urged to consult their tax advisors regarding the tax shelter disclosure rules and their possible application to them.
+ U.S. Shareholders should consult their own tax advisors regarding any tax reporting or filing obligations they may have as a result of their acquisition, ownership or disposition of Shares.
+
+ Non-U.S. Shareholders
+
+ Except as described below, a Fund anticipates that a non-U.S. Shareholder will not be subject to U.S. federal income tax on such shareholder s distributive share of the Fund s income, provided that such income is not considered to be income of the shareholder that is effectively connected with the conduct of a trade or business 
+
+ 
+
+ 68
+
+ Table of Contents
+
+ 
+ within the United States. In the case of an individual non-U.S. Shareholder, such shareholder will be subject to U.S. federal income tax on gains on the sale of Shares in a Fund s or such shareholder s distributive share of gains if such shareholder is present in the United States for 183 days or more during a taxable year and certain other conditions are met.
+
+ If the income from a Fund is effectively connected with a U.S. trade or business carried on by a non-U.S. Shareholder (and, if certain income tax treaties apply, is attributable to a U.S. permanent establishment), then such shareholder s share of any income and any gains realized upon the sale or exchange of Shares will be subject to U.S. federal income tax at the graduated rates applicable to U.S. citizens and residents and domestic corporations. Non-U.S. Shareholders that are corporations may also be subject to a 30% U.S. branch profits tax (or lower treaty rate, if applicable) on their effectively connected earnings and profits that are not timely reinvested in a U.S. trade or business. If a Fund has any effectively connected income, then a non-U.S. Shareholder would also be subject to a 10% withholding tax upon a sale or exchange of such non-U.S. Shareholder s Shares. The IRS has temporarily suspended this withholding for interests in publicly traded partnerships until regulations implementing such withholding are issued.
+ To the extent any interest income allocated to a non-U.S. Shareholder is considered portfolio interest, generally neither the allocation of such interest income to the non-U.S. Shareholder nor a subsequent distribution of such interest income to the non-U.S. Shareholder will be subject to withholding, provided that the non-U.S. Shareholder is not otherwise engaged in a trade or business in the United States and provides a Fund with a timely and properly completed and executed IRS Form W-8BEN, Form W-8BEN-E, or other applicable form. In general, portfolio interest is interest paid on debt obligations issued in registered form, unless the recipient owns 10% or more of the voting power of the issuer.
+ Non-U.S. Shareholders that are individuals will be subject to U.S. federal estate tax on the value of U.S. situs property owned at the time of their death (unless a statutory exemption or tax treaty exemption applies). It is unclear whether partnership interests such as the Shares will be considered U.S. situs property. Accordingly, non-U.S. Shareholders may be subject to U.S. federal estate tax on all or part of the value of the Shares owned at the time of their death.
+
+ Non-U.S. Shareholders are advised to consult their own tax advisors with respect to the particular tax consequences to them of an investment in the Shares.
+
+ Foreign Account Tax Compliance
+
+ The Foreign Account Tax Compliance Act provisions of the Hiring Incentives to Restore Employment Act ( FATCA ) generally impose a reporting and 30% withholding tax regime with respect to certain items of U.S. source income (including dividends and interest) ( Withholdable Payments ). Pursuant to recently proposed regulations, the U.S. Treasury Department has indicated its intent to eliminate the requirements under FATCA of withholding on gross proceeds from the sale or other disposition of property that can produce U.S. source interest or dividends. The U.S. Treasury Department has indicated that taxpayers may rely on these proposed regulations pending their finalization. As a general matter, the rules are designed to require U.S. persons direct and indirect ownership of non-U.S. accounts and non-U.S. entities to be reported to the IRS. The 30% withholding tax regime applies if there is a failure to provide required information regarding U.S. ownership. The withholding rules generally apply to Withholdable Payments.
+ The rules may subject a non-U.S. Shareholder s share of Withholdable Payments received by a Fund to 30% withholding tax unless such shareholder provides information, representations and waivers of non-U.S. law as may be required to comply with the provisions of the rules, including information regarding certain U.S. direct and indirect owners of such non-U.S. Shareholder. A non-U.S. Shareholder that is treated as a foreign financial institution will generally be subject to withholding unless it agrees to report certain information to the IRS regarding its U.S. accountholders and those of its affiliates.
+ Prospective shareholders should consult their own advisors regarding the requirements under FATCA with respect to their own situation.
+
+ 
+
+ 69
+
+ Table of Contents
+
+ 
+ Regulated Investment Companies ( RICs )
+
+ The treatment of a RIC s investment in a Fund will depend, in part, on whether the Fund is classified as a qualified publicly traded partnership (a PTP ) for purposes of the RIC rules. RICs are only allowed to invest up to 25% of their assets in qualified PTPs and to treat gross income and gross gains derived from such investments as qualifying income for purposes of certain rules relevant to determining whether an entity qualifies as a RIC.
+
+ Similarly, interests in a qualified PTP are treated as issued by such PTP and a RIC is not required to look through to the underlying partnership assets when testing compliance with certain asset diversification or gross income tests applicable to determining whether an entity qualified as a RIC. On the other hand, an investment by a RIC in a publicly traded partnership that is not a qualified PTP is not counted against the 25% limit on a RIC s investments in qualified PTPs and the RIC is treated as owning its proportionate share of the partnership s gross assets and earning its proportionate share of the partnership s gross income and gross gains for purposes of the asset and income tests relevant to determining whether an entity qualifies as a RIC.
+ It is intended that a Fund is and will continue to be a qualified PTP. The IRS has previously privately ruled that positions in regard to an index similar to the Index produced income permissible under the RIC qualification tests. If the income of a Fund were determined to be permissible under the RIC qualification tests, it will not affect the classification of a Fund as a partnership. However, under such circumstances, the Fund would not be a qualified PTP. Prospective RIC investors should consult a tax advisor regarding the treatment of an investment in the Fund under current tax rules and in light of their particular circumstances.
+
+ Tax-Exempt Organizations
+
+ An organization that is otherwise exempt from U.S. federal tax is nonetheless subject to taxation with respect to its unrelated business taxable income ( UBTI ), to the extent that its UBTI from all sources exceeds $1,000 in any taxable year. Except as noted below with respect to certain categories of exempt income, UBTI generally includes income or gain derived (either directly or through a partnership) from a trade or business, the conduct of which is substantially unrelated to the exercise or performance of the organization s exempt purpose or function.
+
+ UBTI generally does not include passive investment income, such as dividends, interest and capital gains, whether realized by the organization directly or indirectly through a partnership (such as a Fund) in which it is a partner. This type of income is exempt, subject to the discussion of unrelated debt-financed income below, even if it is realized from securities-trading activity that constitutes a trade or business.
+
+ UBTI includes not only trade or business income or gain as described above, but also unrelated debt-financed income. This latter type of income generally consists of (1) income derived by an exempt organization (directly or through a partnership) from income producing property with respect to which there is acquisition indebtedness at any time during the taxable year and (2) gains derived by an exempt organization (directly or through a partnership) from the disposition of property with respect to which there is acquisition indebtedness at any time during the twelve-month period ending with the date of the disposition. Each Fund does not expect to incur a significant amount of acquisition indebtedness with respect to its assets.
+ To the extent a Fund recognizes gain from property with respect to which there is acquisition indebtedness, the portion of the gain that will be treated as UBTI will be equal to the amount of the gain multiplied by a fraction, the numerator of which is the highest amount of the acquisition indebtedness with respect to the property during the twelve month period ending with the date of their disposition, and the denominator of which is the average amount of the adjusted basis of the property during the period that such property is held by a Fund during the taxable year. In determining the unrelated debt-financed income of a Fund, an allocable portion of deductions directly connected with the Fund s debt-financed property will be taken into account. In making such a determination, for instance, a portion of losses from debt-financed securities (determined in the manner described above for evaluating the portion of any gain that would be treated as UBTI) would offset gains treated as UBTI. Any tax-exempt shareholder that recognizes UBTI will be required to compute such UBTI separately for each line of unrelated business if such shareholder has more than one unrelated trade or business. A charitable remainder trust is subject to a 100% federal excise tax on any UBTI that it earns; in view of the potential for UBTI, the Shares may not be a suitable investment for a charitable remainder trust.
+ 
+
+ 70
+
+ Table of Contents
+
+ 
+ Certain tax-exempt shareholders that are private educational institutions will be subject to a 1.4% excise tax on their net investment income.
+
+ Certain State and Local Taxation Matters
+
+ Prospective shareholders should consider, in addition to the U.S. federal income tax consequences described above, the potential state and local tax consequences of investing in the Shares.
+
+ State and local laws often differ from U.S. federal income tax laws with respect to the treatment of specific items of income, gain, loss, deduction and credit. A shareholder s distributive share of the taxable income or loss of a Fund generally will be required to be included in determining the shareholder s reportable income for state and local tax purposes in the jurisdiction in which the shareholder is a resident. Each Fund may conduct business in one or more jurisdictions that will subject a shareholder to tax (and require a shareholder to file an income tax return with the jurisdiction with respect to the shareholder s share of the income derived from that business). A prospective shareholder should consult its tax advisor with respect to the availability of a credit for such tax in the jurisdiction in which the shareholder is resident.
+ Backup Withholding
+
+ In certain circumstances, shareholders may be subject to backup withholding on certain payments paid to them if they do not establish that they are exempt from the backup withholding rules or if they do not furnish their correct taxpayer identification number (in the case of individuals, their social security number) and certain certifications, or who are otherwise subject to backup withholding. Backup withholding is not an additional tax. Any amounts withheld from payments made to an investor may be refunded or credited against an investor s U.S. federal income tax liability, if any, provided that the required information is furnished to the IRS.
+ Shareholders should be aware that certain aspects of the U.S. federal, state and local income tax treatment regarding the purchase, ownership and disposition of Shares are not clear under existing law. Thus, shareholders are urged to consult their own tax advisors to determine the tax consequences of ownership of the Shares in their particular circumstances, including the application of U.S. federal, state, local and foreign tax laws.
+
+ Euroclear System
+
+ Any participant of Euroclear that holds Shares through Euroclear will be deemed to have represented to and agreed with a Fund and Euroclear as a condition to Shares being in Euroclear to furnish to Euroclear (a) its tax identification number, (b) notice of whether it is (i) a person who is not a United States person, (ii) a foreign government, an international organization or any wholly owned agency or instrumentality of either of the foregoing or (iii) a tax exempt identity, and (c) such other information as Euroclear may request from time to time in order to comply with its United States tax reporting obligations. If a participant in Euroclear fails to provide such information, Euroclear may, amongst other courses of action, block trades in the Shares and related income distributions of such participant.
+ Euroclear is a Belgium-based financial services company that specializes in the settlement of securities transactions as well as the safekeeping and asset servicing of these securities. Euroclear settles domestic and international securities transactions, covering bonds, equities, derivatives and investment funds. Euroclear provides securities services to financial institutions located in more than 90 countries.
+
+ In addition to its role as an International Central Securities Depository (ICSD), Euroclear also acts as the Central Securities Depository (CSD) for Belgian, Dutch, Finnish, French, Irish, Swedish and UK securities.
+
+ Each of the Euroclear CSDs are regulated by the relevant authorities within their respective home countries. Incorporated in Belgium, Euroclear SA/NV is subject to the supervision of the Belgium Financial Services and Markets Authority (FSMA). The National Bank of Belgium (NBB) also has oversight. Euroclear plc is authorized as a service company by the Financial Conduct Authority in the United Kingdom.
+
+ 
+
+ 71
+
+ Table of Contents
+
+ 
+ PART TWO
+GENERAL POOL DISCLOSURE
+
+ This Prospectus has two parts: the offered series disclosure and the general pool disclosure. These parts are bound together and are incomplete if not distributed together to prospective participants.
+
+ USE OF PROCEEDS
+
+ Each Fund seeks to use substantially all of the proceeds of the offering of Shares of the Fund to make portfolio investments in a manner consistent with its investment objective. Each Fund also may hold cash or cash equivalents, such as U.S. Treasury securities or other high credit quality, short-term fixed-income or similar securities (such as shares of money market funds) as collateral for Financial Instruments and pending investment in Financial Instruments. To the extent that a Fund does not invest the proceeds of the offering of the Shares in the manner described above on the day such proceeds are received, such proceeds may be deposited with the Custodian.
+ The Commodity Sub-Adviser, a registered commodity trading advisor, is responsible for the management of all Fund investments, including cash management activities of a Fund, such as investing in cash equivalents that may be used as margin for the Fund s portfolio holdings.
+
+ WHO MAY SUBSCRIBE?
+
+ Only Authorized Participants may create or redeem Creation Units. Each Authorized Participant must (1) be a registered broker-dealer or other securities market participant such as a bank or other financial institution which is not required to register as a broker-dealer to engage in securities transactions, (2) be a member of a national clearing agency, and (3) have entered into an agreement with the Sponsor (an Authorized Participant Agreement).
+
+ 
+
+ 72
+
+ Table of Contents
+
+ 
+ CREATION AND REDEMPTION OF SHARES
+
+ Each Fund creates and redeems Shares from time to time, but only in one or more Creation Units. A Creation Unit is a block of at least 10,000 Shares. Except when aggregated in Creation Units, the Shares are not redeemable securities.
+
+ The manner by which Creation Units are purchased and redeemed is governed by the terms of the Authorized Participant Agreement and Authorized Participant Procedures Handbook, and all such procedures are at the discretion of the Sponsor. By placing a purchase order, an Authorized Participant agrees to deposit cash or Financial Instruments with the Custodian of a Fund (unless as provided otherwise by this Prospectus). Purchases and redemptions made by Authorized Participants primarily in cash rather than through in-kind delivery of Financial Instruments, if not offset by a transaction fee (as described below), may cause a Fund to incur certain costs, including brokerage costs or taxable capital gains or losses, that may decrease the Fund s net asset value.
+ If permitted by the Sponsor in its sole discretion with respect to a Fund, an Authorized Participant may also agree to enter into or arrange for an exchange of a futures contract for related position ( EFCRP ) or block trade with the Fund whereby the Authorized Participant would also transfer to the Fund a number and type of exchange-traded futures contracts at or near the closing settlement price for such contracts on the purchase order date. Similarly, the Sponsor in its sole discretion may agree with an Authorized Participant to use an EFCRP to effect an order to redeem Creation Units.
+
+ An EFCRP is a technique permitted by the rules of certain futures exchanges that, as utilized by a Fund in the Sponsor s discretion, would allow the Fund to take a position in a futures contract from an Authorized Participant, or give futures contracts to an Authorized Participant, in the case of a redemption, rather than to enter the futures exchange markets to obtain such a position. An EFCRP by itself will not change either party s net risk position materially. Because the futures position that a Fund would otherwise need to take in order to meet its investment objective can be obtained without unnecessarily impacting the financial or futures markets or their pricing, EFCRPs can generally be viewed as transactions beneficial to the Fund. A block trade is a technique that permits a Fund to obtain a futures position without going through the market auction system and can generally be viewed as a transaction beneficial to the Fund.
+ Authorized Participants pay a fixed transaction fee of up to $500 in connection with each order to create or redeem a Creation Unit in order to compensate the Administrator, Sub-Administrator, the Custodian and the Transfer Agent of a Fund and its Shares, for services in processing the creation and redemption of Creation Units and to offset the costs of increasing or decreasing derivative positions. Authorized Participants also may pay a variable transaction fee to the Fund of up to 0.20% of the value of the Creation Unit that is purchased or redeemed unless the transaction fee is waived or otherwise adjusted by the Sponsor. The Sponsor provides such Authorized Participant with prompt notice in advance of any such waiver or adjustment of the transaction fee. The Sponsor may waive a fixed or variable transaction fee for any number of reasons, including to maintain similar costs structures as competitive investment vehicles. Authorized Participants may sell the Shares included in the Creation Units they purchase from a Fund to other investors.
+ The form of Authorized Participant Agreement and the related Authorized Participant Procedures Handbook set forth the procedures for the creation and redemption of Creation Units and for the payment of cash or Financial Instruments required for such creations and redemptions. The Sponsor may delegate its duties and obligations under the form of Authorized Participant Agreement to the Administrator, Sub-Administrator, the Custodian and the Transfer Agent without consent from any shareholder or Authorized Participant. The form of Authorized Participant Agreement, the related procedures attached thereto and the Authorized Participant Procedures Handbook may be amended by the Sponsor without the consent of any shareholder or Authorized Participant. Authorized Participants who purchase Creation Units from a Fund receive no fees, commissions or other form of compensation or inducement of any kind from either the Sponsor or the Fund, and no such person has any obligation or responsibility to the Sponsor or the Fund to effect any sale or resale of Shares.
+ Authorized Participants are cautioned that some of their activities may result in their being deemed participants in a distribution in a manner which would render them statutory underwriters and subject them to the prospectus delivery and liability provisions of the 1933 Act, as described in Plan of Distribution. 
+
+ 
+
+ 73
+
+ Table of Contents
+
+ 
+ Each Authorized Participant must be registered as a broker-dealer under the 1934 Act and regulated by the Financial Industry Regulatory Authority, Inc. ( FINRA ), or exempt from being, or otherwise not required to be, so regulated or registered, and must be qualified to act as a broker or dealer in the states or other jurisdictions where the nature of its business so requires. Certain Authorized Participants may be regulated under federal and state banking laws and regulations. Each Authorized Participant must have its own set of rules and procedures, internal controls and information barriers as it determines is appropriate in light of its own regulatory regime.
+ Authorized Participants may act for their own accounts or as agents for broker-dealers, custodians and other securities market participants that wish to create or redeem Creation Units.
+
+ Persons interested in purchasing Creation Units should contact the Sponsor or the Administrator to obtain the contact information for the Authorized Participants. Shareholders who are not Authorized Participants are only able to redeem their Shares through an Authorized Participant.
+
+ Pursuant to the Authorized Participant Agreement, the Sponsor agreed to indemnify the Authorized Participants against certain liabilities, including liabilities under the 1933 Act, and to contribute to the payments the Authorized Participants may be required to make in respect of those liabilities.
+
+ The following description of the procedures for the creation and redemption of Creation Units is only a
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2022/VIVC_vivic-corp_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/VIVC_vivic-corp_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..3450f0e6fd41b65ef32faf4fceeeadf35fce9655
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2022/VIVC_vivic-corp_prospectus_summary.txt
@@ -0,0 +1,7267 @@
+PROSPECTUS
+ SUMMARY
+ 3-22
+
+ 
+ THE
+ OFFERING
+ 23-25
+
+ 
+ RISK
+ FACTORS
+ 26-41
+
+ 
+ USE
+ OF PROCEEDS
+ 41
+
+ 
+ DETERMINATION
+ OF OFFERING PRICE
+ 42
+
+ 
+ DILUTION
+ 42-43
+
+ 
+ DIVIDEND
+ POLICY
+ 43
+
+ 
+ PLAN
+ OF DISTRIBUTION
+ 43-44
+
+ 
+ BUSINESS
+ 44-49
+
+ 
+ MANAGEMENT S
+ DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 
+ 49
+
+ 
+ RESULTS
+ OF OPERATIONS
+ 49-58
+
+ 
+ DIRECTOR
+ AND OFFICER LIABILITY AND INDEMNIFICATION
+ 58-59
+
+ 
+ MANAGEMENT
+ 59
+
+ 
+ EXECUTIVE
+ OFFICER AND DIRECTOR COMPENSATION
+ 60
+
+ 
+ SECURITY
+ OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
+ 60
+
+ 
+ MAJOR
+ SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
+ 60-61
+
+ 
+ DESCRIPTION
+ OF CAPITAL STOCK
+ 61-64
+
+ 
+ SHARES
+ ELIGIBLE FOR FUTURE SALE
+ 64
+
+ 
+ TAXATION
+ 64-66
+
+ 
+ LEGAL
+ MATTERS
+ 66-67
+
+ 
+ EXPERTS
+ 67
+
+ 
+ WHERE
+ YOU CAN FIND ADDITIONAL INFORMATION
+ 67
+
+ 
+ FINANCIAL
+ STATEMENTS
+ 68
+
+ 
+ OTHER
+ EXPENSES OF ISSUANCE AND DISTRIBUTION
+ 68
+
+ 
+ INDEMNIFICATION
+ OF DIRECTORS AND OFFICERS 
+ 68
+
+ 
+ RECENT
+ SALES OF UNREGISTERED SECURITIES
+ 68-69
+
+ 
+ EXHIBITS
+ AND FINANCIAL STATEMENT SCHEDULES
+ 69
+
+ 
+ UNDERTAKINGS
+ 70
+
+ 
+ SIGNATURE
+ 71
+
+ 
+ INDEX
+ TO FINANCIAL STATEMENTS
+ F-1
+
+ 
+
+ 7
+
+ 
+
+ 
+
+Please
+read this prospectus carefully. It describes our business, our financial condition and results of operations. We have prepared this prospectus
+so that you will have the information necessary to make an informed investment decision. You should rely only on information contained
+in this prospectus. We have not authorized any other person to provide you with different information. This prospectus is not an offer
+to sell, nor is it seeking an offer to buy these securities in any state where the offer or sale is not permitted. The information in
+this prospectus is complete and accurate as of the date on the front cover, but the information may have changed since that date.
+
+ 
+
+ABOUT
+THIS PROSPECTUS
+
+ 
+
+This
+prospectus is part of a registration statement that we filed with the Securities and Exchange Commission, or the Commission. Under this
+registration statement, the selling stockholders named in this prospectus or any supplement to this prospectus may sell from time to
+time the securities described in this prospectus in one or more offerings. This prospectus provides you with a general description of
+the securities the selling stockholders may offer. To the extent appropriate, we may provide a prospectus supplement that contains specific
+information about the terms of the offering. A prospectus supplement may also add, update or change information contained in this prospectus.
+Any statement that we make in this prospectus will be modified or superseded by any inconsistent statement made by us in a prospectus
+supplement. You should read both this prospectus and any prospectus supplement together with the information incorporated herein by reference
+as described under the heading Incorporation of Certain Documents by Reference and the additional information described
+under the heading Where You Can Find Additional Information, before buying any of the securities being offered.
+
+ 
+
+You
+should rely only on the information contained in or incorporated by reference into this prospectus or any prospectus supplement. We have
+not authorized anyone to provide you with additional or different information. The selling stockholders are offering to sell, and seeking
+offers to buy, shares of common shares only in jurisdictions where offers and sales are permitted.
+
+ 
+
+This
+prospectus contains forward-looking statements that are subject to a number of risks and uncertainties, many of which are beyond our
+control. Please read Risk Factors on page 17 to 30 and Forward-Looking Statements right below.
+
+ 
+
+This
+is a direct participation offering since we are offering the stock directly to the public without the participation of an underwriter.
+Our officers and sole director will be solely responsible for selling shares under this offering and no commission will be paid on any
+sales.
+
+ 
+
+You
+should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with information different
+from that contained in this prospectus. The information contained in this prospectus is accurate only as of the date of this prospectus,
+regardless of the time of delivery of this prospectus or of any sale of our common shares.
+
+ 
+
+Investors
+are cautioned that you are not buying shares of a China-based operating company but instead are buying shares of a Nevada holding company
+issuer that operates through its subsidiaries in China and Taiwan.
+
+ 
+
+The
+Registrant is a Nevada holding company conducting our operations in China through wholly owned subsidiaries with direct equity ownership.
+We are not a China operating company. We are a holding company and own any substantive business operations in China through direct equity
+ownership. We conduct our operations primarily through our subsidiaries in China. Therefore, you will not directly hold any equity interests
+in our China operating companies. Our holding company structure involves unique risks to investors. Chinese regulatory authorities may
+disallow our operating structure, which would likely result in a material change in our operations and/or the value of our common shares,
+including that it could cause the value of such securities to significantly decline or become worthless. For a detailed description of
+risks related to the holding corporate structure, see Risk Factors – Risks Related to Doing Business in the PRC .
+
+ 
+
+The
+Registrant has adopted a two-category share structure in which we have common shares and Preferred Shares. In respect of matters requiring
+the votes of shareholders, each common share is entitled to one vote and each Preferred Share is entitled to fifty (50) votes. Each Preferred
+Shares may be converted into ten (10) common shares by its holder. We have authorized 5,000,000 Preferred Shares and Honetech Inc, a
+Samoa company, beneficially owns all of the 832,200 issued and outstanding Preferred Shares. Mr. Yun-Kuang Kung through the appointment
+by Honetech Inc, exercise the voting power of these preferred stock. Therefore, Honetech Inc and Yun-Kuang Kung both control 41,600,000
+votes, which constitute approximately 54.7% of the aggregate voting power of the Company assuming we are able to successfully sell all
+the 10,000,000 shares in this prospectus. 
+
+ 1
+
+ 
+
+ 
+
+FORWARD-LOOKING
+STATEMENTS
+
+ 
+
+This
+prospectus contains forward-looking statements which relate to future events or our future financial performance. In some cases, you
+can identify forward-looking statements by terminology such as may , should , expects , plans ,
+ anticipates , believes , estimates , predicts , potential or continue 
+or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks,
+uncertainties and other factors, including the risks in the section entitled Risk Factors, that may cause our or our industry s
+actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity,
+performance or achievements expressed or implied by these forward-looking statements. While these forward-looking statements, and any
+assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business,
+actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future
+performance suggested herein. Except as required by applicable law, including the securities laws of the United States, we do not intend
+to update any of the forward-looking statements to conform these statements to actual results. In addition, the management s assumptions
+about future events may prove to be inaccurate. All readers are cautioned that the forward-looking statements contained in this prospectus
+and in the documents incorporated by reference into this prospectus are not guarantees of future performance, and we cannot assure any
+reader that such statements will be realized or that the forward-looking events and circumstances will occur. Actual results may differ
+materially from those anticipated or implied in the forward-looking statements due to factors described in Risk Factors 
+included elsewhere in this prospectus and in the documents that we include in or incorporate by reference into this prospectus, including
+our Form 10-K/T for the transition period from May 1, 2019 to December 31, 2019, and our subsequent Commission filings. All forward-looking
+statements speak only as of the date they are made. We do not intend to update or revise any forward-looking statements as a result of
+new information, future events or otherwise, except as required by law. These cautionary statements qualify all forward-looking statements
+attributable to us or persons acting on our behalf.
+
+ 2
+
+ 
+
+ 
+
+PROSPECTUS
+SUMMARY
+
+ 
+
+As
+used in this prospectus, references to the Company, we, our , us or Vivic 
+refer to Vivic Corp. unless the context otherwise indicates. The following summary highlights selected information contained in this
+prospectus. Before making an investment decision, you should read the entire prospectus carefully, including the Risk Factors 
+on page 25 to 40 and Financial Statements . All dollar
+amounts refer to US dollars unless otherwise indicated.
+
+ 
+
+Corporate
+Information
+
+ 
+
+The
+Company s executive office is located at No. 19, Jianping 3rd St., An-Ping District., Tainan City 708, Taiwan and its telephone
+number is 886-6-2995233. The Company s registered office is located at 187 E. Warm Springs Rd., Suite B450 Las Vegas, NV. 89119.
+Its telephone number is 702-899-0818 and its website is www.vivic.biz. Information contained on or accessed through our website is not
+intended to constitute and shall not be deemed to constitute part of this Prospectus.
+
+ 
+
+Business
+Overview
+
+ 
+
+We
+were incorporated on February 16, 2017 in the State of Nevada. In addition to the US administrative office, the company currently has
+several offices with 30 full-time employees located in Taiwan, China, and Hong Kong. We were initially a travel agency that organized
+individual and group tours in the Dominican Republic, such as cultural, recreational, sport, business, ecotours and other travel tours.
+
+ 
+
+We
+acquired Guangzhou Monte Fino Yacht Co., Ltd, a Chinese limited liability company, in October 2019 to carry out business operations in
+China. Guangzhou Monte Fino Yacht Co., Ltd later changed its name to Vivic Guangdong Corporation Limited.( Vivic Guangdong ).
+Khashing Guangdong has been our major business operating entity in China. It holds an exclusive license to use Kha Shing Enterprise Company s
+brand name Monte Fino in China.
+
+ 
+
+On
+January 3, 2021, the Company entered into a Joint Venture and Cooperation Agreement to invest in Shenzhen Ocean Way Yachts Services Co.,
+Ltd ( Ocean Way ). During the year ended December 31, 2021, we have invested a total amount of $122,665 (RMB 780,000).
+Ocean Way is a medial company which edits a yachts magazine and holds accounts in main media platforms such as Weibo. However, to concentrate
+on yachts manufacturing and sales, on March 27, 2022, we sold the investment in Ocean Way to a third party.
+
+ 
+
+On
+May 11, 2021, our subsidiary namely Guangzhou Khashing Yacht Company Limited ceased its operation and de-registered.
+
+ 
+
+On
+June 23, 2021, our subsidiary namely Vivic Corporation (Fujian) Co., Limited ceased its operation and de-registered.
+
+On
+June 24, 2021, our subsidiary namely Khashing Yachts Industry Development (Hainan) Co. Ltd ceased its operations and de-registered.
+
+ 
+
+On
+September 23, 2021, we acquired an additional 25% of Vivic Corporation (Hong Kong) Co., Limited. As a result, Vivic Corporation (Hong
+Kong) Co., Limited becomes a wholly-owned subsidiary. In addition to the yacht and marina business operations beginning in August 2020,
+we developed our yacht and boat prototypes, especially all-electric boats which use clean energy for power, in partnership with KhaShing
+Enterprise Co., the leading yacht and boat manufacturing company in Taiwan.
+
+ 
+
+Regarding
+our consulting services, we help customers find the best values and purchase products such as yachts by acting as an intermediary for
+their purchase and sales transactions. We also help customers obtain patents, implement product launch plans, and evaluate products.
+Through our assistance, some customers have sold yachts with satisfactory experiences, while others have started marina development plans
+in Taiwan and China.
+
+ 
+
+Before
+the acquisition of Vivic Guangdong Corporation Limited. (formerly known as Guangzhou Monte Fino Yacht Company Limited ( MF )
+by Vivic, MF had already approached local governments in Quanzhou, Chongwu and Shanwei for licenses to develop marinas in the area. As
+a result, after the merger, the company continued to apply for marinas and land use under the name of Vivic Corp.
+
+ 
+
+We
+currently carry out the following business operations mainly in China and we provide some consulting services in Taiwan:
+
+ 
+
+(1)Development
+ and operations of yacht marinas. We have leased and operated a yacht marina in Wenzhou, China.
+
+ 3
+
+ 
+
+ 
+
+(2)We
+ developed and operated an online platform Joy Wave to provide yacht rental
+ and time-share services in China.
+
+ 
+
+(3)We
+ provided consulting services to other yacht marina operators related to the planning, marketing
+ and operating of yacht marinas
+
+ 
+
+(4)Research
+ and development of all-electric boats. We began commercialization of all-electric boats in
+ the fourth quarter of 2002.
+
+ 
+
+Organization
+& Subsidiaries
+
+ 
+
+The
+following table sets forth our relationship with our subsidiaries whose financial statements are consolidated.
+
+ 
+
+ 
+ Name
+ of Entity
+ Relationship
+ to Us
+ Nature
+ of Business
+
+ 
+ Vivic
+ Corp.
+ N.A.
+ Holding
+ Company
+
+ 
+ Vivic
+ Corp. Taiwan Branch
+ 100%
+ owned by Vivic Corp
+ Branch
+ Office
+
+ 
+ Vivic
+ Corporate (Hong Kong) Co., Limited ( Vivic HK ), a Hong Kong company
+ 100%
+ owned by Vivic Corp
+ Holding
+ Company
+
+ 
+ Vivic
+ Guangdong Corporation Limited.( Vivic Guangdong ), a China company
+ 100%
+ owned by Vivic HK
+ Operates
+ tourism, yacht rental service and Joywave online platform
+
+ 
+ Guangzhou
+ Hysoul Yacht Company Limited ( GZ Hysoul ), a China company
+ 100%
+ owned by Vivic Guangdong
+ Operates
+ tourism business, Yacht rental service and operates online Joywave platform.
+
+ 
+ Wenzhou
+ Jiaxu Yacht Company Limited
+ 100%
+ owned by Vivic Guangdong
+ Operates
+ tourism business and yacht rental service
+
+ 
+ Vivic
+ Guangdong Corporation Limited, QingDao branch
+ 100%
+ owned by Vivic Guangdong
+ Operates
+ boat leasing and boat sales
+
+ 
+ 
+
+The
+following chart shows our corporate structure as of the date of this prospectus:
+
+ 
+
+ 4
+
+ 
+
+ 
+
+Development and Operations of Yacht Marinas
+
+ 
+
+Development
+and operations of yacht marinas in China is our main business goal. On November 30, 2020, our China subsidiary Vivic Guangdong entered
+into a contract with Wenzhou Yangfushan Marina Co. Ltd. to lease and operate Wenzhou Yangfushan Yacht Marina. Under this agreement, we
+leased Wenzhou Yangfushan Marina from its landowner and developer for a term of 5 years. We will assume the full management and operation
+of this yacht marina and receive all the revenues generated from it. Under the contract, we shall pay to the landowner and the developer
+a fixed annual lease fee and some percentage of the operating revenues. The services we provided at this marina include yacht chartering,
+wedding photography, marina advertising, sailing events, yacht training, yacht sales, electric boat bases, etc. At the same time, a membership
+system will be adopted so that members can enjoy various membership benefits.
+
+ 
+
+Our
+marina operations began in 2021 and its business includes yacht chartering, wedding photography, marina advertising, sailing events,
+yacht training, yacht sales, electric boat bases, etc. At the same time, a membership system was adopted at the marina, and members can
+enjoy various services by joining the membership. The marina has 18 berths that can fit yachts up to 60 feet, and can provide temporary
+berths to fit up to 115 feet yachts. At the same time, the marina also has a 2,100 square feet office space that can be used for management
+and sailing training. There is also 21,000 square feet space next to the marina that can be rented for events. However, due to Covid-19
+pandemic, our Wenzhou Yangfushan marina has limited operations in 2021 and 2022. We expect that the operations will be gradually normal
+in 2023 as the Chinese government has indicated that it will open businesses and reduce travel bans due to COVID-19 impact.
+
+ 
+
+ Joy
+Wave Online Platform
+
+ 
+
+Through
+Vivic Guangdong, we developed and operate an internet platform named Joy Wave ( ) to provide yacht time-share,
+rental and charter services. Yacht owners can add their yachts onto Joy Wave for rental while customers can use the platform to book
+yacht for creational purpose. We are still developing an app version for our Joy Wave platform. Joy Wave is an essential
+platform to support our marina development and operations business. The platform has been tested in Guangzhou, Xiamen, Wenzhou and Shenzhen,
+China. When the app version is available in the near future, we will promote to netizens with marketing and advertising campaigns. 
+
+ 
+
+Consulting
+Services
+
+ 
+
+We
+provide consulting services to other developers and operators of marinas related to the planning, marketing and operating of yacht marinas.
+We assist marina operator clients to promote their products through marketing channels, help to build customer relationships and increase
+brand loyalty and awareness. We help clients to develop marketing plan and packaging procedure. We also help clients evaluate their business
+performance to effectively control their manpower and costs. Instead of paying on a percentage of the total transaction, our clients
+pay a fixed monthly fee for our service provided. We introduce clients to the internet platform and assist them with broadcasting their
+business to the platform. We use our experience and technology on the network platform to help our clients expand their customer base.
+
+ 
+
+Our
+service includes following categories:
+
+ 
+
+ Marketing
+Planning and Promotion: We assist marina operator clients to promote their products through marketing channels, help to build customer
+relationships and increase brand loyalty and awareness. We help clients to develop marketing plan and packaging procedure. We also help
+clients evaluate their business performance to effectively control their manpower and costs. Instead of paying on certain percentages
+of the total transaction values, our clients pay a fixed monthly fee for our service.
+
+ 
+
+ Internet
+platform: We introduce clients to the internet platform and assist them with promoting their business on the platform. We use our experience
+and technology on the network platform to help our clients expand their customer base.
+
+ 
+
+ Industry-University
+cooperation and joint research: Using customer feedback and industry data, we analyze possible future products and participate in professional
+technology and marina operations transfer through our joint R&D centers including marina developing, design and yacht manufacturing
+technology.
+
+ 
+
+Our
+clients include marina-operating private companies and local governments planning to develop local marina business industry. We have
+provided consulting services to Kinmen Marina in Taiwan. We utilized our experiences in marina design and operation to conduct
+preliminary planning through on-site surveys, and utilized our local connections to help the client develop and construct the Kinmen
+Marina.
+
+ 5
+
+ 
+
+ 
+
+Research
+and Development of All-Electric Boats
+
+ 
+
+Starting
+August 2020, we started the research and development of all-electric boats. We have developed several prototypes and are still in the
+process of improving and testing the technology for commercial production. We expect that the boating
+industry will follow the electrification roadmap of the automotive industry by creating all-electric boats that meet or exceed the traditional
+boating consumer s expectations of price, value and run times. In other words, all-electric boats must offer a similar recreation
+experience when compared to traditional fuel-powered boat in terms of size, capability and price point. Since we expedited our
+electric boat R&D in the past months, we anticipated that our all-electric boat commercialization will realize in the second half
+of 2022. But we cannot guarantee you that we may progress or the commercialization of all-electric boats may develop as expected due
+to lack of funding and the impact of COVID-19 pandemic.,
+
+ 
+
+Industry
+Overview
+
+ 
+
+We
+carried out business operations mainly in Taiwan and China. Therefore, our yacht and boating industry overview primary covers Taiwan
+and Chinese markets.
+
+ 
+
+Overview
+of Taiwan s yacht industry
+
+ 
+
+Based
+on the information found in Chapter 7 Yachts in The Law of Ships by Taiwan Ministry of Transportation and Communications and Taiwan Shipbuilding
+Industry Association and Wikipedia, yacht manufacturing in Taiwan began from 1958 to the 1990s. It was started by the introduction of
+the US military in Taiwan and the combination of domestic sampan manufacturers. Later, foreign customers used yacht design drawings to
+find domestic manufacturers to accept orders and import glass fibers from abroad. Some manufacturers directly purchase design drawings
+from customers for mass production to reduce costs, and profits increased after the rapid growth of orders. Because domestic manufacturers
+only focused on OEM production in the industrial chain in the 1990s, the main market for yachts started shrinking. Yacht manufacturers
+have begun to diversify the market and seek technological upgrades, as well as to strengthen customization and increase added value.
+From 2000 to 2011, Taiwan s yacht manufacturers began to conduct strategic alliances and improve the infrastructure of manufacturing
+engineering. This led to the development of larger markets such as customization and mega yachts. Those yachts include fiberglass yachts,
+luxury yachts, customized medium and large power yachts, and high-end custom sailing boats. The yachts range from 38 feet to 150 feet,
+and most of them are luxury yachts from 60 feet to 80 feet.
+
+ 
+
+The
+standards of environmental protection have been increasing in recent decades. For example, The European Union and International Maritime
+Organization ( IMO ) has been implementing the new marine engine emission standards since 2008. The yachts with traditional
+diesel engines produce massive waste and lead to environmental pollution. Nowadays, the lithium battery with its clean energy is prevailing
+in the electric yachts industry. As they are eco-friendly, these liquified natural gas ( LNG ) yachts and electric yachts
+are the latest favorites in the market. Because electric yachts are made with zero-emission and low-noise level engines, they can easily
+meet energy-saving and emission control requirements. The trading volume of electric yachts increased tremendously in last decades. As
+yachts batteries and hybrid yachts become more advanced, the industry of electric yachts continued its growth after 2020. We believe
+that eventually all-electric boats and yachts will completely replace their gasoline or diesel-powered counterparts, especially in the
+rivers, lakes, and coastal waters. The demand for the less polluting ships in Taiwan, China, South East Asia, and Europe are particularly
+high as there are millions of gas or diesel-powered ships in use in these regions and have caused severe pollution to their waters.
+
+ 
+
+However,
+one issue should be borne in mind that electric yachts replacing traditional diesel yachts is a continuing process. Both should be co-existed
+for a long time, like the motor vehicle with new-energy engine and the traditional one.
+
+ 
+
+There
+are ginormous potential markets for electric yachts in the Asian countries including Japan, Taiwan, PRC, and the Middle East countries.
+There are 400,000 yachts and skiffs in Japan and mostly are fishing boats. The skiffs are equipped with battery electric or hybrid module
+for efficiency. Further, the buyers of small-sized yachts are more price-conscious. Electric yachts will cut the costs down. Japan has
+more potentials in product update in the future. The Asian countries, like Taiwan and PRC, and the Middle East countries are emerging
+markets of yachts. They are the right places for launching new products. For our marketing strategy, new products are used for capturing
+the new market share and increasing the existing market share.
+
+ 
+
+For
+yacht marketing activities, the size of exhibitions reveals the tremendous potential in the Asian markets. The yacht exhibition Singapore
+is the largest one in Asia. Only 11 yachts participated in the yacht exhibition Singapore 2011. Favorably, approximate 100 exhibitors
+joined the same in 2019, more than 80 yachts participated and attracted over 16,000 people entered into it. The number of yachts participated
+in this exhibition approximately 8 times increased from the one in 2011. This reflects high growth rate in the Asian yacht markets.
+
+ 6
+
+ 
+
+ 
+
+There
+are different needs from different Asian yacht markets. The high-GDP groups in Hong Kong and PRC become the potential growth markets
+for yacht industry. However, there is great divergence among the Asian and Western customers regarding the yacht specifications. Asian
+markets focus on the size instead of the number of functional areas of yachts. It is because they normally cruise with short-distance
+in day time but not long-distance at night. Therefore, there are a lot of works to be accomplished for developing the markets. Catamarans
+are popular in the Asian countries because they provide more spacious areas with stable navigation. They are also able to access to the
+shallow water for more fun.
+
+ 
+
+In
+the research Global Electric Boats, Small Submarines and Autonomous Underwater Vehicles (AUV) 2015-2024 – Forecasts, Players,
+Opportunities from an international market research company, Research and Markets, it shows that the market of marine electric
+vehicles will rapidly grow due to the new capability, affordability and legislation banning or restricting internal combustion engines.
+The electric water craft will increase from $2.6 billion in 2013 to $7.3 billion in 2024 (quote from Research and Markets). It is approximate
+RMB 45.31 billion. The prospect in the electric boats is optimistic.
+
+ 
+
+Overview
+of China s yacht industry
+
+ 
+
+Yacht
+Manufacturing
+
+ 
+
+According
+to the statistics in the China Yacht Industry Development Summary Report of Shanghai Shipbuilding Industry Association and
+China Shipbuilding Industry Association Boat Branch, China s yacht industry started in the 1950s and experienced a slow development
+process for decades. The initial development of the yacht industry did not appear until the beginning of this century. Based on the development
+and construction of leisure (or household) yachts, the development of China s yacht industry is divided into the following four stages:
+
+ 
+
+The
+first stage, the introduction of FRP technology, digestion, and absorption stage (late 1950s-60s).
+
+ 
+
+The
+second stage is the stage of laying the technical foundation for OEM export of OEM processing (in the early 1980s-90s of the 20th century).
+
+ 
+
+The
+third stage is the development stage of yacht manufacturing driven by market demand at home and abroad (from the late 1990s to 2008).
+
+ 
+
+The
+fourth stage, the possible rise of opportunities caused by the financial turmoil (from 2008 to the present)
+
+ 
+
+As
+of 2010, there were more than 370 yacht manufacturing companies in the mainland, and more than 30 companies with an output value of more
+than 10 million yuan. These companies are mainly concentrated in Shenzhen, Shanghai, Qingdao, Tianjin, Xiamen, Zhuhai and other cities.
+In 2017, Taiwan s export volume of mega yachts ranked first in Asia and fifth in the world. Exported 120 mega yachts with a total value
+of 200 million U.S. dollars. Taiwan has firmly established itself as a leader in the production of mega yachts in Asia. Because of this,
+many Chinese yacht manufacturers use Taiwan s managers and designs.
+
+ 
+
+According
+to the China s Yacht Industry Report 2016-2021 (DUBLIN, April 06, 2017 /PRNewswire), manufacturing costs of yachts is 20% to 30% lower
+in China than that in Europe or North American countries. The yacht market is expected to remain an annual growth rate of over 10% because
+of the increasing high-income earners and yacht registration policies in China in the next few years.
+
+ 
+
+Yacht
+Sale
+
+ 
+
+According
+to the statistics of the article The current situation of China s yacht industry in 2019, changes in consumption concepts, and
+the prospects for yacht consumption by Huajing Information Network (huaon.com), with the rapid economic development and the improvement
+of living standards, some coastal cities in China already have the economic conditions to consume yachts. As such, the development of
+the yacht industry is entering a golden age. In 2018, China s yacht production reached 2010, of which the luxury yacht market sales
+were approximately RMB 5.11 billion, accounting for 44.6% of the entire yacht industry, with an average annual growth rate of more than
+30%. In 2018, the total number of Chinese yachts reached 22,060, and it is estimated that by 2025, the total number of Chinese yachts
+will reach 163,510. According to customs data, China s yacht exports in 2017 were US$258 million, an increase of 24.1%, and imports
+also increased by 24.1% year-on-year to US$218 million. In 2018, the import volume of Chinese yachts fell by 47% compared with the previous
+year, but the value of imports increased by 47% compared with the previous year. The unit price of imported yachts reached a record high,
+reaching 75,300 US dollars per yacht.
+
+ 
+
+Marina
+and Yacht Club
+
+ 
+
+In
+terms of yacht marinas and clubs, the yacht industry is highly emphasized by many local governments as an emerging industry and that
+they have high hopes for and regard its development as a benchmark for urban success. According to CCYIA statistics,
+
+ 7
+
+ 
+
+ 
+
+China currently
+has 149 yacht clubs, 93 of which are registered with the National Maritime Safety Department. There are 12,000 berths and 2,700 open-air
+berths on the land. China has a total of 11,184 miles of coastline, 6,530 islands, 8,700 miles of island coastline, and many rivers and
+lakes. This provides vast natural resources for yacht development, and because southern China is not affected much by the seasonal climate,
+visitors are able to enjoy the unique geographical conditions the coast has to offer.
+
+ 
+
+Competitive
+Strengths
+
+ 
+
+We
+face strong competition from well-established companies and small independent companies. We may be at a competitive disadvantage in obtaining
+the facilities, employees, financing, and other resources required to provide our services and products to customers. Our opportunity
+to obtain customers may be limited by our financial resources and other assets.
+
+ 
+
+We
+believe we have the following competitive strengths. Some of our competitors may have these or other competitive strengths.
+
+ 
+
+ Advanced
+R&D and Design Capabilities. Our Operating Subsidiaries have currently been granted several patents, including invention
+patents, utility model patents, and design patents. The core team of our R&D department currently consists of three professionals
+who are in charge of yacht design, mechanical engineering, and shipbuilding engineering, respectively.
+
+ 
+
+ Strict
+Quality Control. Our Operating Subsidiaries pay great attention to the control of yacht quality and have established a comprehensive
+quality management system to strictly manage the purchase of raw materials and the production processes.
+
+ 
+
+ High
+Brand Recognition in the Industry and Commitment to Differentiated Services. In addition to affiliations with the renowned KhaShing
+brand, our Operating Subsidiaries have registered a series of trademarks and created the independent brand of VIVIC through
+years of hard work in the field of recreational boating industry. Our Operating Subsidiaries
+provide our customers with individual design solutions and our diverse manufacturing technologies enable us to produce specialized and
+customized recreational boars according to their project needs.
+
+ 
+
+ High-Quality
+After-sales Maintenance and Market Development. Our Operating Subsidiaries have assigned dedicated personnel to be responsible
+for maintaining after-sales services in different regional markets.
+
+ 
+
+ Experienced
+Management Team: Our management team members have many years of experiences in yacht and marina industry and their experiences
+allow us to grow our business more efficiently and swiftly.
+
+ 
+
+ Strong
+Relationship with Kha Shing Enterprise Company., Kha Shing Enterprise Company is one of the leading yacht manufacturers in Taiwan
+and has high reputation in Taiwan, China and other countries. Having strong relationship with Kha Shing Enterprise allows us to be able
+to grow our business with the strong support from Kha Shing s expertise and resources.
+
+ 
+
+Dividend
+Distributions or Transfers of Cash among the Holding Company (Vivic Corp.), its Subsidiaries, and the PRC Operating Entities
+
+ 
+
+As
+of the date of this prospectus, none of Vivic(HK) and the PRC operating entities have made any dividends to Vivic Corp. We intend to
+keep any future earnings to re-invest in and finance the expansion of the business of the PRC operating entities, and we do not anticipate
+that any cash dividends will be paid in the foreseeable future. As of the date of this prospectus, Vivic Corp., Vivic(HK) as well as
+the PRC operating entities have not adopted or maintained any cash management policies and procedures. 
+
+ 
+
+Vivic
+Corp. is a holding company with no material operations of its own and has generated limited revenues. Cash proceeds raised from
+overseas financing activities, including the cash proceeds from this offering, may be transferred by Vivic Corp. to PRC operating
+subsidiaries and Vivic HK) via capital contribution or shareholder loans, as the case may be. The process for sending such
+proceeds back to the mainland China may be time-consuming after the closing of this offering. We may be unable to use these proceeds
+to grow the business of the PRC operating entities until the PRC operating entities receive such proceeds in mainland China. Any
+transfer of funds by the offshore holding company to the entities in the PRC, either as a loan or as an increase in registered
+capital, are subject to approval by or registration or filing with relevant governmental authorities in mainland China. Any foreign
+loans procured by the PRC operating entities is required to be registered with China s State Administration of Foreign Exchange
+( SAFE ) or its local branches or satisfy relevant requirements, and Vivic Guangdong may not procure foreign loans which
+exceed the difference between their respective total project investment amount and registered capital or 2.5 times (which may be
+varied due to the change of mainland China s national macro-control policy) of the net worth of Vivic Guangdong. According to
+the applicable PRC regulations on foreign-invested enterprises in mainland China, capital
+
+ 8
+
+ 
+
+ 
+
+contributions to the PRC operating entities are subject to the filing with State Administration for Market
+Regulation in its local branches, the Ministry of Commerce in its local branches and registration with a local bank authorized by SAFE.
+See Risk Factors — Risks Related to Doing Business in China — PRC regulation of loans to and direct investment in
+PRC entities by offshore holding companies and governmental control of currency conversion may delay us from using the proceeds of this
+offering to make loans or additional capital contributions to our subsidiaries, which could materially and adversely affect our liquidity
+and our ability to fund and expand the business of the PRC operating entities .
+
+ 
+
+Under
+our current corporate structure, we rely on dividend payments from the China operating entities and Vivic (HK) to fund any cash and financing
+requirements we may have, including the funds necessary to pay dividends and other cash distributions to our shareholders or to pay any
+debt we may incur:
+
+ 
+
+ Vivic
+Guangdong s ability to distribute dividends is based upon its distributable earnings. Current mainland China regulations permit
+Vivic Guangdong and its subsidiaries to pay dividends to Vivic Corp and Vivic HK) in accordance with applicable PRC laws and regulations
+under Vivic Guangdong can only pay dividends to Vivic Corp. And Vivic(HK) out of its accumulated profits, if any, determined in accordance
+with Chinese accounting standards and regulations. Furthermore, Vivic Guangdong could make payments to Vivic Corp. And Vivic(HK) pursuant
+to the relevant agreements between them as permitted by the applicable PRC regulations. In addition, Vivic Guangdong is required to set
+aside certain after-tax profit to fund a statutory reserve as described below in this section.
+
+ 
+
+ Based
+on the Hong Kong laws and regulations, as of the date of this prospectus, there is no restriction imposed by the Hong Kong government
+on the transfer of capital within, into and out of Hong Kong, except transfer of funds involving money laundering and criminal activities.
+As a result, Vivic(HK) may further distribute any dividends or payments (if any) to Vivic Corp. as dividends.
+
+ 
+
+ Vivic
+Corp. is permitted under the Nevada laws to provide funding to our subsidiaries in Taiwan, Hong Kong and PRC through loans or capital
+contributions without restrictions on the amount of the funds, subject to satisfaction of applicable government registration, approval
+and filing requirements. Vivic Corporate (Hong Kong) Co., Limited ( Vivic HK ) is also permitted under the laws of Hong Kong
+to provide funding to Vivic Corp. through dividend distribution without restrictions on the amount of the funds.
+
+ 
+
+ Cash
+dividends, if any, on our common shares will be paid in U.S. dollars. The PRC government also imposes controls on the conversion of RMB
+into foreign currencies and the remittance of currencies out of the PRC. Therefore, we may experience difficulties in completing the
+administrative procedures necessary to obtain and remit foreign currency for the payment of dividends from our profits, if any. Furthermore,
+if Vivic Guangdong and subsidiaries incurs debt on their own in the future, the instruments governing the debt may restrict their ability
+to pay dividends or make other payments. If Vivic Guangdong and subsidiaries are unable to distribute dividends or make payments directly
+or indirectly to Vivic Corp., we may be unable to pay dividends on our common shares.
+
+ 
+
+The
+transfer of funds among the PRC operating entities are subject to the Provisions of the Supreme People s Court on Several Issues
+Concerning the Application of Law in the Trial of Private Lending Cases (2020 Second Amendment, the Provisions on Private Lending
+Cases ), which was implemented on January 1, 2021 to regulate the financing activities between natural persons, legal persons and
+unincorporated organizations. The Provisions on Private Lending Cases set forth that private lending contracts will be upheld as invalid
+under the circumstance that (i) the lender swindles loans from financial institutions for relending; (ii) the lender relends the funds
+obtained by means of a loan from another profit-making legal person, raising funds from its employees, illegally taking deposits from
+the public; (iii) the lender who has not obtained the lending qualification according to the law lends money to any unspecified object
+of the society for the purpose of making profits; (iv) the lender lends funds to a borrower when the lender knows or should have known
+that the borrower intended to use the borrowed funds for illegal or criminal purposes; (v) the lending is violations of public orders
+or good morals; or (vi) the lending is in violations of mandatory provisions of laws or administrative regulations. As advised by our
+PRC counsel, Liuhe (Wenzhou)Law Firm, the Provisions on Private Lending Cases does not prohibit using cash generated from one PRC operating
+entity to fund another affiliated PRC operating entity s operations. We or the PRC operating entities have not been notified of
+any other restriction which could limit the PRC operating entities ability to transfer cash among each other.
+
+ 
+
+In
+addition, the PRC government imposes controls on the convertibility of the Renminbi into foreign currencies and, in certain cases, the
+remittance of currency out of China. If the foreign exchange control system prevents us from obtaining sufficient foreign currencies
+to satisfy our foreign currency demands, we may not be able to transfer cash out of China and pay dividends in foreign currencies to
+our shareholders. There can be no assurance that the PRC government will not intervene or impose restrictions on our ability to transfer
+or distribute cash within our organization or to foreign investors, which could result in an
+
+ 9
+
+ 
+
+ 
+
+inability or prohibition on making transfers
+or distributions outside of mainland China and may adversely affect our business, financial condition and results of operations. See
+ Risk Factors — Risks Related to Doing Business in China —Governmental
+control of currency conversion may limit our ability to utilize our net revenues effectively and affect the value of your investment .
+
+ 
+
+If
+we are considered a China tax resident enterprise for tax purposes, any dividends we pay to our overseas shareholders may be regarded
+as China-sourced income and as a result may be subject to PRC withholding tax at a rate of up to 10.0%. Certain payments from Vivic Guangdong
+and subsidiaries are subject to mainland China taxes, including business taxes and value-added taxes.
+
+ 
+
+In
+addition, each of the PRC operating entities is required to set aside at least 10% of its after-tax profits each year, if any, to fund
+a statutory reserve until such reserve reaches 50% of its registered capital. Each of such entity in China may also set aside a portion
+of its after-tax profits to fund an optional employee welfare fund, although the amount to be set aside, if any, is determined at the
+discretion of its board of directors and shareholders. Although the statutory reserves can be used, among other ways, to increase the
+registered capital and eliminate future losses in excess of retained earnings of the respective companies, the reserve funds are not
+distributable as cash dividends except in the event of liquidation.
+
+ 
+
+Subject
+to the Nevada Business Corporation Act and our bylaws, our board of directors may authorize and declare a dividend to shareholders at
+such time and of such an amount as they think fit if they are satisfied, on reasonable grounds, that immediately following the dividend
+the value of our assets will exceed our liabilities and we will be able to pay our debts as they become due. There is no further Nevada
+statutory restriction on the amount of funds which may be distributed by us by dividends.
+
+ 
+
+Under
+the current practice of the Inland Revenue Department of Hong Kong, no tax is payable in Hong Kong in respect of dividends
+paid by us. The laws and regulations of the PRC do not currently have any material impact on transfer of cash from Vivic Corp. to Vivic
+HK or from Vivic HK to Vivic Corp. There are no restrictions or limitation under the laws of Hong Kong imposed on the conversion of HK
+dollar into foreign currencies and the remittance of currencies out of Hong Kong or across borders and to U.S investors.
+
+ 
+
+Foreign
+Exchange Fund Transfer Regulations
+
+ 
+
+China
+
+ 
+
+According
+to the Foreign Investment Law of the People s Republic of China and its implementing rules, which jointly established the legal
+framework for the administration of foreign-invested companies, a foreign investor may, in accordance with other applicable laws, freely
+transfer into or out of China its contributions, profits, capital earnings, income from asset disposal, intellectual property rights
+royalties acquired, compensation or indemnity legally obtained, and income from liquidation, made or derived within the territory of
+China in RMB or any foreign currency, and any entity or individual shall not illegally restrict such transfer in terms of the currency,
+amount and frequency. According to the Company Law of the People s Republic of China and other Chinese laws and regulations, our
+PRC subsidiaries may pay dividends only out of their respective accumulated profits as determined in accordance with Chinese accounting
+standards and regulations. In addition, each of our PRC subsidiaries is required to set aside at least 10% of its accumulated after-tax
+profits, if any, each year to fund a certain statutory reserve fund, until the aggregate amount of such fund reaches 50% of its registered
+capital. Where the statutory reserve fund is insufficient to cover any loss the Chinese subsidiary incurred in the previous financial
+year, its current financial year s accumulated after-tax profits shall first be used to cover the loss before any statutory reserve
+fund is drawn therefrom. Such statutory reserve funds and the accumulated after-tax profits that are used for covering the loss cannot
+be distributed to us as dividends. At their discretion, our PRC subsidiaries may allocate a portion of their after-tax profits based
+on Chinese accounting standards to a discretionary reserve fund.
+
+ 
+
+Renminbi
+is not freely convertible into other currencies. As result, any restriction on currency exchange may limit the ability of our PRC subsidiaries
+to use their potential future renminbi incomes to pay dividends to us. The Chinese government imposes controls on the convertibility
+of renminbi into foreign currencies and, in certain cases, the remittance of currency out of China. Shortages in availability of foreign
+currency may then restrict the ability of our PRC subsidiaries to remit sufficient foreign currency to our offshore entities for our
+offshore entities to pay dividends or make other payments or otherwise to satisfy our foreign-currency-denominated obligations. The renminbi
+is currently convertible under the current account, which includes dividends, trade and service-related foreign exchange
+transactions, without the need of the approval of the State Administration of Foreign Exchange of China ( SAFE ). By contrast,
+the renminbi under the capital account, which includes foreign direct investment and foreign currency debt, including loans
+we may secure for our onshore subsidiaries, may be converted into other currencies upon the approval of the SAFE and the conversion is
+also subject to other restrictions or limitations, e.g., control of a Chinese entity s foreign debt quota. Currently, our PRC subsidiaries
+may purchase foreign currency for settlement of current
+
+ 10
+
+ 
+
+ 
+
+account transactions, including payment of dividends to us, without
+the approval of the SAFE by complying with certain procedural requirements. However, the relevant Chinese governmental authorities may
+limit or eliminate our ability to purchase foreign currencies in the future for current account transactions. The Chinese government
+may continue to strengthen its capital controls, and additional restrictions and substantial vetting processes may be instituted by SAFE
+for cross-border transactions falling under both the current account and the capital account. Any existing and future restrictions on
+currency exchange may limit our ability to utilize revenue generated in renminbi to fund our business activities outside of China or
+pay dividends in foreign currencies to holders of our securities. Foreign exchange transactions under the capital account remain subject
+to limitations and require approvals from, or registration with, SAFE and other relevant Chinese governmental authorities. This could
+affect our ability to obtain foreign currency through debt or equity financing for our subsidiaries.
+
+ 
+
+Hong
+Kong
+
+ 
+
+There
+are no restrictions or limitations under the laws of Hong Kong imposed on the conversion of HK dollar into foreign currencies and the
+remittance of currencies out of Hong Kong, nor is there any restriction on any foreign exchange to transfer cash between the Company
+and its subsidiaries, across borders and to investors outside of PRC, nor is there any restrictions and limitations to distribute earnings
+from the subsidiaries, to the Company and investors outside of PRC and amounts owed. 
+
+Taiwan
+
+ 
+
+Regulations
+Relating to Foreign Exchange
+
+ 
+
+Taiwan
+Foreign Exchange Control Law and regulations provide that all foreign exchange transactions must be executed by banks designated by Taiwan s
+Financial Supervisory Commission and the Central Bank of the Republic of China (Taiwan) to engage in such transactions. Current regulations
+favor trade-related or service-related foreign exchange transactions. Consequently, foreign currency earned from exports of merchandise
+and services may now be retained and used freely by exporters, and all foreign currency needed for the importation of merchandise and
+services may be purchased freely from the designated foreign exchange banks.
+
+ 
+
+Apart
+from trade-related or service-related foreign exchange transactions, Taiwan companies and individual residents reaching the age of 20
+may, without foreign exchange approval, remit foreign currency of up to US$50 million (or its equivalent) and US$5 million (or its equivalent)
+to and from Taiwan (or such other amount as determined by the Central Bank of the Republic of China (Taiwan) from time to time at its
+discretion in consideration of Taiwan s economic and financial conditions or the needs to maintain the order of foreign exchange
+market in Taiwan), respectively, in each calendar year. The above limits apply to remittances involving either a conversion of NTD into
+a foreign currency or a conversion of foreign currency into NTD. In addition, a requirement is also imposed on all enterprises to register
+medium- and long-term foreign debt with the Central Bank of the Republic of China (Taiwan).
+
+ 
+
+Subject
+to specified requirements but without foreign exchange approval of the Central Bank of the Republic of China (Taiwan), foreign persons
+may remit to and from Taiwan foreign currencies of up to US$100,000 (or its equivalent) per remittance if the required documentation
+is provided to the authorities in Taiwan. The above limit applies to remittances involving either a conversion of NTD into a foreign
+currency or a conversion of foreign currency into NTD.
+
+ 
+
+Regulations
+Relating to Dividend Distribution and Fund Transfer
+
+ 
+
+Except
+under limited circumstances, a Taiwanese company will not be permitted to distribute dividends or make other distributions to shareholders
+in any given year in which it did not record net income or retained earnings (excluding reserves). The Taiwan Company Act requires that
+10% of annual net income (less prior years losses, if any, and applicable income taxes) be set aside as a legal reserve until
+the accumulated legal reserve equals the paid-in capital of the company. The company will be permitted to make distributions to its shareholders
+in cash or in the form of common shares from legal reserves if it has no accumulated loss, provided that the distribution payable out
+of the company s legal reserve can only come from the amount exceeding 25% of the total paid-in capital.
+
+ 
+
+Enforceability
+of Judgment Against Our China-based Officers and Directors
+
+ 
+ 
+
+Some
+of our directors and officers are located in China. As a result, it may be difficult for a shareholder to effect service of process within
+the United States upon these individuals, or to bring an action against us or these individuals in the United States, or to
+enforce against us or them judgments obtained in United States courts, including judgments predicated upon the civil liability provisions
+of the securities laws of the United States or any state in the United States.
+
+ 11
+
+ 
+
+ 
+
+China
+has not entered into treaties or arrangements providing for the recognition and enforcement of judgments made by courts of most other
+jurisdictions. Any final judgment obtained against our directors or officers located in China in any court other than the courts of the
+PRC in connection with any legal suit or proceeding arising out of or relating to our securities will be enforced by the courts of the
+PRC in connection with any legal suit or proceeding arising out of or relating to our securities will be enforced by the courts of the
+PRC without further review of the merits only if the court of the PRC in which enforcement is sought is satisfied that:
+
+ 
+
+ 
+ 
+ 
+ the
+ court rendering the judgment has jurisdiction over the subject matter according to the laws of the PRC;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ judgment and the court procedure resulting in the judgment are not contrary to the public order or good morals of the PRC 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ if
+ the judgment was rendered by default by the court rendering the judgment, our directors or officers were duly served within a reasonable
+ period of time in accordance with the laws and regulations of the jurisdiction of the court or process was served on them with judicial
+ assistance of the PRC and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ judgments
+ at the courts of the PRC are recognized and enforceable in the court rendering the judgment on a reciprocal basis.
+
+ 
+ 
+
+Our
+PRC counsel, Liuhe (Wenzhou) Law Firm, has advised us that there is uncertainty as to whether PRC courts would:
+
+ 
+
+ 
+ 
+ 
+ recognize
+ or enforce judgments of United States courts obtained against us or our directors or officers predicated upon the civil liability
+ provisions of the securities laws of the United States or any state in the United States; or
+
+ 
+ 
+
+ 
+ 
+ 
+ entertain
+ original actions brought in each respective jurisdiction against us or our directors or officers predicated upon the securities laws
+ of the United States or any state in the United States.
+
+ 
+ 
+
+The
+recognition and enforcement of foreign judgments are provided for under the PRC Civil Procedures Law. PRC courts may recognize and enforce
+foreign judgments in accordance with the requirements of the PRC Civil Procedures Law based either on treaties between China and the
+country where the judgment is made or on principles of reciprocity between jurisdictions. China does not have any treaties or other form
+of reciprocity with the United States that provides for the reciprocal recognition and enforcement of foreign judgments. In addition,
+according to the PRC Civil Procedures Law, courts in the PRC will not enforce a foreign judgment against us or our directors and officers
+if it decides that the judgment violates the basic principles of PRC law or national sovereignty, security, or public interest. As a
+result, it is uncertain whether, and on what basis, a PRC court would enforce a judgment rendered by a court in the United States.
+Under the PRC Civil Procedures Law, foreign shareholders may originate actions based on PRC law against a company in China for disputes
+if they can establish sufficient nexus to the PRC for a PRC court to have jurisdiction, and meet other procedural requirements, including,
+among others, the plaintiff must have a direct interest in the case, and there must be a concrete claim, a factual basis and a cause
+for the suit. It will be, however, difficult for U.S. shareholders to originate actions against us in the PRC in accordance with
+PRC laws by virtue only of holding the common shares, to establish a connection to the PRC for a PRC court to have jurisdiction as required
+under the PRC Civil Procedures Law.
+
+ 
+
+If
+you fail to establish the foregoing to the satisfaction of the courts in the PRC, you may not be able to enforce a judgment against our
+officers or directors rendered by a court in the United States.
+
+ 
+
+Further,
+pursuant to the Civil Procedures Law of the PRC, any matter, including matters arising under U.S. federal securities laws, in relation
+to assets or personal relationships may be brought as an original action in China, only if the institution of such action satisfies the
+conditions specified in the Civil Procedures Law of the PRC. As a result of the conditions set forth in the Civil Procedures Law and
+the discretion of the PRC courts to determine whether the conditions are satisfied and whether to accept action for adjudication, there
+remains uncertainty as to whether an investor will be able to bring an original action in a PRC court based on U.S. federal securities
+laws. See also Risk Factors - Risks Related to Doing Business in China - You may have difficulty effecting service of
+legal process, enforcing judgments or bringing actions against us and our management .
+
+ 
+
+Our
+Challenges and Risks.
+
+ 
+
+We
+recommend that you consider carefully the risks discussed below and under the heading Risk Factors beginning on page 11
+of this prospectus before purchasing our common shares. If any of these risks occur, our business, prospects, financial condition,
+
+ 12
+
+ 
+
+ 
+
+liquidity,
+results of operations and ability to make distributions to our shareholders could be materially and adversely affected. In that case,
+the trading price of our common shares could decline and you could lose some or all of your investment. These risks include, among others,
+the following:
+
+ 
+
+(1)The
+market in which we participate is intensely competitive, and we may not be able to compete successfully with our current or future competitors.
+
+ 
+
+(2)We
+rely on contracts with the PRC and Taiwan government to use land. If the PRC or Taiwan revokes our land use rights, we would have no
+operational capabilities or ability to conduct our business.
+
+ 
+
+(3)We
+are subject to PRC and Taiwan laws and regulations. Changes in the laws, regulations or current policies of the PRC and Taiwan could
+negatively affect our ability to conduct our business or eliminate certain tax-related benefits that we enjoy.
+
+ 
+
+These
+and other risks are discussed more fully in the section of this Prospectus Risk Factors on page 25 to 40.
+
+ 
+
+Implications
+of Being an Emerging Growth Company
+
+ 
+
+We
+qualify as an emerging growth company as defined in the Jumpstart our Business Startups Act of 2012, or the JOBS Act. An
+emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to
+public companies. These provisions include:
+
+ 
+
+ 
+ 
+ 
+ the
+ ability to include only two years of audited financial statements and only two years of related management s discussion and
+ analysis of financial condition and results of operations disclosure; and
+
+ 
+ 
+
+ 
+ 
+ 
+ an
+ exemption from the auditor attestation requirement in the assessment of our internal control over financial reporting pursuant to
+ the Sarbanes-Oxley Act of 2002.
+
+ 
+ 
+
+We
+may take advantage of these provisions for up to five years or such earlier time that we are no longer an emerging growth company. We
+would cease to be an emerging growth company if we have more than $1.0 billion in annual revenue, have more than $700 million in market
+value of our common shares held by non-affiliates or issue more than $1.0 billion of non-convertible debt over a three-year period.
+
+ 
+
+Intellectual
+Property and Patents
+
+ 
+
+We
+expect to rely on, trade secrets, copyrights, know-how, trademarks, license agreements and contractual provisions to establish our intellectual
+property rights and protect our brand and services. These legal means, however, afford only limited protection and may not adequately
+protect our rights. Litigation may be necessary in the future to enforce our intellectual property rights, protect our trade secrets
+or determine the validity and scope of the proprietary rights of others. Litigation could result in substantial costs and diversion of
+resources and management attention. 
+
+ 
+
+We
+intend to seek the widest possible protection for significant product and process developments in our major markets through a combination
+of trade secrets, trademarks, copyrights, and patents, if applicable. We anticipate that the form of protection will vary depending upon
+the level of protection afforded by the particular jurisdiction.
+
+ 
+
+We
+intend to register trademarks as a means of protecting the brand names of our companies and products. We intend protect our trademarks
+against infringement and seek to register design protection where appropriate.
+
+ 
+
+We
+rely on trade secrets and unpatentable know-how that we seek to protect, in part, by confidentiality agreements. We expect that, where
+applicable, we will require our employees to execute confidentiality agreements upon the commencement of employment with us. We expect
+these agreements to provide that all confidential information developed or made known to the individual during the course of the individual s
+relationship with us is to be kept confidential and not disclosed to third parties except in specific limited circumstances. The agreements
+will also provide that all inventions conceived by the individual while rendering services to us shall be assigned to us as the exclusive
+property of our company. There can be no assurance, however, that all persons who we desire to sign such agreements will sign, or if
+they do, that these agreements will not be breached, that we would have adequate remedies for any breach, or that our trade secrets or
+unpatentable know-how will not otherwise become known or be independently developed by competitors. 
+
+ 
+
+We
+currently hold or submitted application for the following licensed patents:
+
+ 
+
+-Khashing
+ Yachts Industry (Guangdong) Limited holds the patent of product outlook design in China, number
+ ZL 2021 3 064100.5 which was granted on February 15, 2022.
+
+ 13
+
+ 
+
+ 
+
+-Guangzhou
+ Hysoul Yacht Company Limited holds the software intellectual property patent in China, number
+ 2021SR1144816 which was granted on August 4, 2021.
+
+ 
+
+-Guangzhou
+ Hysoul Yacht Company Limited holds the software intellectual property patent in China, number
+ 2021SR1145446 which was granted on August 4, 2021.
+
+ 
+
+-Guangzhou
+ Hysoul Yacht Company Limited holds the software intellectual property patent in China, number
+ 2021SR1145445 which was granted on August 4, 2021.
+
+ 
+
+-Guangzhou
+ Hysoul Yacht Company Limited holds the software intellectual property patent in China, number
+ 2021SR1149124 which was granted on August 4, 2021.
+
+ 
+
+-Guangzhou
+ Hysoul Yacht Company Limited holds the software intellectual property patent in China, number
+ 2021SR1145444 which was granted on August 4, 2021.
+
+ 
+
+-Guangzhou
+ Hysoul Yacht Company Limited holds the software intellectual property patent in China, number
+ 2021SR1144815 which was granted on August 4, 2021.
+
+ 
+
+-Guangzhou
+ Hysoul Yacht Company Limited holds the software intellectual property patent in China, number
+ 2021SR1150088 which was granted on August 4, 2021.
+
+ 
+
+-Guangzhou
+ Hysoul Yacht Company Limited holds the software intellectual property patent in China, number
+ 2021SR1149123 which was granted on August 4, 2021.
+
+ 
+
+We
+currently hold or submitted application for the following trademarks:
+
+ 
+
+-Vivic
+ Corporation holds the trademark in China, number 37996389 which is registered on January
+ 7, 2020 and valid until January 6, 2030.
+
+ 
+
+-Guangzhou
+ Hysoul Yacht Company Limited holds the trademark in China, number 43040712 which was registered
+ on October 7, 2020 and valid until October 6, 2030.
+
+ 
+
+-Guangzhou
+ Hysoul Yacht Company Limited holds the trademark in China, number 43044195 which was registered
+ on December 21, 2020 and valid until December 20, 2030.
+
+ 
+
+-Guangzhou
+ Hysoul Yacht Company Limited holds the trademark in China, number 43052680 which was registered
+ on December 21, 2020 and valid until December 20, 2030.
+
+ 
+
+-Guangzhou
+ Hysoul Yacht Company Limited holds the trademark in China, number 43048081 which was registered
+ on October 7, 2020 and valid until October 6, 2030.
+
+ 
+
+-Guangzhou
+ Hysoul Yacht Company Limited holds the trademark in China, number 43043622 which was registered
+ on December 14, 2020 and valid until December 13, 2030.
+
+ 
+
+-Vivic
+ Corp. holds the trademark in Nevada, USA, Reference Number 16460524 on December 29, 2020
+ covering Class 35 and National Classes 100, 101 and 102.
+
+ 
+
+Summary
+of Risks Affecting Our Company
+
+ 
+
+Our
+business is subject to numerous risks described in the section titled Risk Factors and elsewhere in this prospectus. The
+main risks set forth below and others you should consider are discussed more fully in the section entitled Risk Factors –
+Risks Related to Our Business, Risk Factors – Risk Related to Our Industry, Risk Factors – Risks
+Related to Doing Business in the PRC, Risk Factors – Risks Related to Doing Business in Taiwan, and Risk
+Factors- Risks Related to Ownership of Our common shares which you should read in its entirety starting from page 18.
+
+ 
+
+Risks
+Related to Conducting Operations in PRC
+
+ 
+
+Currently,
+our business operations are mainly based in the PRC. Because of such ties to China, we may be subjected to the laws, rules and regulations
+of the PRC. For more detailed description of the below risks and other risks related to acquiring and operating business in China and
+Hong Kong, see Risk Factors — Risks Related to Conducting Operations in PRC beginning on page 20. These risks
+include, but are not limited to, the following:
+
+ 
+
+ A
+ downturn in the PRC or global economy, and economic and political policies of the PRC could
+ materially and adversely affect our business and financial condition. For more detailed discussion
+ of this risk, please refer to Risks Factors – Risks Related to Doing Business
+ in the PRC - A downturn in the PRC or global economy, and economic and political policies
+ of the PRC could materially and adversely affect our business and financial condition 
+ on page 20.
+
+ 
+
+ Uncertainties
+ with respect to the PRC legal system could adversely affect us. For more detailed discussion
+ of this risk, please refer to Risks Factors – Risks Related to Doing Business
+ in the PRC - Uncertainties with respect to the PRC legal system could adversely affect us .
+
+ 
+
+ As
+ our production and operations are currently conducted in the PRC, we are subject to certain
+ legal and operational risks associated with our PRC operating subsidiaries. Changes in the
+ policies, regulations, rules, and the enforcement of laws
+
+ 14
+
+ 
+
+ 
+
+ of the PRC government may be quick
+ with little advance notice and could have a significant impact upon our ability to operate
+ profitably in the PRC and the value of our securities. For more detailed discussion of this
+ risk, please refer to Risks Factors – Risks Related to Doing Business in the
+ PRC - Changes in the policies, regulations, rules, and the enforcement of laws of the PRC
+ government may be quick with little advance notice and could have a significant impact upon
+ our ability to operate profitably in the PRC and may cause the value of our securities
+ to significantly decline or be worthless .
+
+ 
+
+ 
+
+ The
+ Chinese government may exercise significant oversight and discretion over the conduct of
+ business in the PRC and may intervene in or influence our operations at any time, which could
+ result in a material change in our operations and/or the value of our securities. We are
+ currently not required to obtain any pre-approval or fulfill the filing and reporting obligation
+ from or to Chinese authorities to list on U.S. exchanges; however, if we are required to
+ obtain approval or fulfill the filing and reporting in the future and are denied permission
+ from Chinese authorities to list on U.S. exchanges, we will not be able to continue listing
+ on U.S. exchange, which would materially affect the interest of the investors. For more detailed
+ discussion of this risk, please refer to Risks Factors – Risks Related to Doing
+ Business in the PRC - The Chinese government may exercise significant oversight and discretion
+ over the conduct of business in the PRC and may intervene in or influence our operations
+ at any time, which could result in a material change in our operations and/or the value of
+ our securities. We are currently not required to obtain any pre-approval or fulfill the filing
+ and reporting obligation from or to Chinese authorities to list on U.S. exchanges; however,
+ if we are required to obtain approval or fulfill the filing and reporting in the future and
+ are denied permission from Chinese authorities to list on U.S. exchanges, we will not be
+ able to continue listing on U.S. exchange, which would materially affect the interest of
+ the investors .
+
+ 
+
+ 
+
+ The
+ Chinese government may intervene in or influence our business operations at any time or may
+ exert more control over offerings conducted overseas and foreign investment in China based
+ issuers, which could result in a material change in our business operations and significantly
+ and adversely impact the value of our securities. Additionally, the governmental and
+ regulatory interference could significantly limit or completely hinder our ability to offer
+ or continue to offer securities to investors and cause the value of such securities to significantly
+ decline or be worthless. For more detailed discussion of this risk, please refer to
+ Risks Factors – Risks Related to Doing Business in the PRC - The Chinese government
+ may intervene in or influence our business operations at any time or may exert more control
+ over offerings conducted overseas and foreign investment in China based issuers, which could
+ result in a material change in our business operations and significantly and adversely impact
+ the value of our securities. Additionally, the governmental and regulatory interference
+ could significantly limit or completely hinder our ability to offer or continue to offer
+ securities to investors and cause the value of such securities to significantly decline or
+ be worthless .
+
+ 
+
+ The
+ PRC government imposes controls on the convertibility of the RMB into foreign currencies
+ and, in certain cases, the remittance of currency out of China. We receive substantially
+ almost of our net revenues in RMB. Under our current corporate structure, we rely on dividend
+ payments from Vivic Guangdong to fund any cash and financing requirements we may have, including
+ the funds necessary to pay dividends and other cash distributions to our shareholders or
+ to pay any debt we may incur. Please refer to Risks Factors – Risks Related
+ to Doing Business in the PRC - Governmental control of currency conversion may limit our
+ ability to utilize our net revenues effectively and affect the value of your investment. 
+
+ 
+
+ Our
+ PRC operating entities depend on the effectiveness of the supply chain management systems
+ to ensure reliable and sufficient supply, on reasonably favorable terms, of materially used
+ in the construction and development of yacht marinas and all-electric boats and operating
+ activities, Please refer to Risks Factors – Risks Related to Doing Business
+ in the PRC -Supply chain interruptions may increase our costs or reduce our revenues in China. 
+
+ 
+
+ We
+ are a holding company, and we rely on dividends and other distributions on equity paid by
+ our subsidiaries for our cash and financing requirements, including the funds necessary to
+ pay dividends and other cash distributions to our shareholders and service any debt we may
+ incur. If Vivic Guangdong and subsidiaries incur debt on their own behalf in the future,
+ the instruments governing the debt may restrict their ability to pay dividends or make other
+ distributions to us. In addition, the China tax authorities may require our subsidiaries
+ to adjust its taxable income, in a manner that would materially and adversely affect their
+ ability to pay dividends and other distributions to us. please refer to Risks Factors
+ – Risks Related to Doing Business in the PRC -We rely on dividends and other distributions
+ on equity paid by our subsidiaries to fund any cash and financing requirements we may have,
+ and any limitation on the ability of our subsidiaries to make payments to us could have a
+ material adverse effect on our ability to conduct the business .
+
+ 15
+
+ 
+
+ 
+
+ Compliance
+ with China s new Data Security Law, Cybersecurity Review Measures, Personal Information
+ Protection Law, regulations and guidelines relating to the multi-level protection scheme
+ and any other future laws and regulations may entail significant expenses and could materially
+ affect our business. For more detailed discussion of this risk, please refer to Risks
+ Factors – Risks Related to Doing Business in the PRC - Compliance with China s
+ new Data Security Law, Cybersecurity Review Measures, Personal Information Protection Law,
+ regulations and guidelines relating to the multi-level protection scheme and any other future
+ laws and regulations may entail significant expenses and could materially affect our business 
+ .
+
+ 
+
+Legal
+and Operational Risks Related to Operations in PRC
+
+ 
+
+We
+conduct certain operations through our subsidiaries in PRC and we also have direct and indirect wholly-owned subsidiaries with some operations
+in the PRC, which may subject us to certain laws and regulations in the PRC. The Chinese government has exercised and continues to exercise
+substantial control over virtually every sector of the Chinese economy through regulations and state ownership. Our ability to conduct
+business may be harmed by changes in its laws and regulations, including those relating to taxation, environmental regulations, property
+and other matters. Also, economic, political and legal developments in the PRC will affect our business, financial condition, results
+of operations and prospects. Policies, regulations, rules, and the enforcement of laws of the PRC government can have significant effects
+on economic conditions in the PRC and the ability of business to operate profitably. Our ability to operate profitably in the PRC may
+be adversely affected by changes in policies by the PRC government, including changes in laws, regulations or their interpretation, particularly
+those dealing with the Internet, including censorship and other restriction on material which can be transmitted over the Internet, security,
+intellectual property, money laundering, taxation and other laws that affect our ability to operate our business in China. As such, these
+may result in a material change in our operations and/or the value of the securities we are registering for sale or could significantly
+limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to
+significantly decline or be worthless.
+
+ 
+
+Regulatory
+Actions and Statements to Regulate Business Operations in PRC
+
+ 
+
+As
+of the date of this prospectus, we are advised by our PRC counsel, Liuhe (Wenzhou) Law Firm that we and our PRC subsidiaries have received
+from PRC authorities, including CSRC, all requisite licenses, permissions or approvals needed to engage in the businesses currently conducted
+in China , and no permission or approval has been denied. The following table provides details on the licenses and permissions held by
+our PRC subsidiaries.
+
+ 
+
+ 
+ Company/Right
+
+ 
+
+ License/Permission
+
+ 
+
+ Issuing
+ Authority
+
+ 
+
+ Validity/expiration
+
+ 
+ Vivic
+ Corporation Guangdong Limited (Vivic Guangdong)
+
+ 
+
+ 
+
+ Business
+ License
+
+ 
+
+ Market
+ Supervision Administration of Guangzhou Huangpu District
+
+ 
+
+ October
+ 11,2066
+
+ 
+ Guangzhou
+ Hysoul yacht CO., Ltd. ( GZ Hysoul )
+
+ 
+
+ Business
+ License
+
+ 
+
+ Market
+ Supervision Administration of Guangzhou Huangpu District
+
+ 
+
+ Unlimited
+
+ 
+ Wenzhou
+ Jiaxu Yacht Company Limited
+
+ 
+
+ Business
+ License
+
+ 
+
+ Market
+ Supervision Administration of Wenzhou Lucheng District
+
+ 
+
+ Unlimited
+
+ 
+ Operation
+ and Management for Wenzhou Yangfushan sailing boat wharf
+
+ 
+
+ 
+ Contract
+
+ 
+
+ 
+ Wenzhou
+ Urban Construction Investment Co., Ltd. (wharf owner),and
+
+ Wenzhou
+ Liangye Environmental Technology Co., Ltd. (owner of supporting housing)
+
+ 
+
+ May
+ 9, 2026
+
+ 
+ Operations
+ for Wenzhou Yacht Club
+
+ 
+
+ Yacht
+ Club record report
+
+ 
+
+ Wenzhou
+ Maritime Affairs Bureau
+
+ 
+
+ Unlimited
+
+ 
+ 
+
+We
+are also aware that recently, the Chinese government initiated a series of regulatory actions and statements to regulate business operations
+in China with little advance notice, including cracking down on illegal activities in the securities market, enhancing supervision over
+China-based companies listed overseas using VIE structure, adopting new measures to extend the scope of cybersecurity reviews, and expanding
+the efforts in anti-monopoly enforcement. Since these regulatory actions and statements are new, it is highly uncertain how soon legislative
+or administrative regulation making bodies will respond and what existing or new laws or regulations or detailed implementations and
+interpretations will be modified or promulgated, if any, and
+
+ 16
+
+ 
+
+ 
+
+the potential impact such modified or new laws and regulations will have
+on our business operations in China, the ability to accept foreign investments and list on a U.S. or other foreign exchange. Although
+currently our business is not affected under these regulatory actions, however, if the legislative or administrative regulation making
+bodies change their focus to the sector which we operate in, it may impact our ability to conduct our business, accept foreign investments,
+or list on a U.S. or other foreign exchange. Any future action by the Chinese government expanding the categories of industries and companies
+whose foreign securities offerings are subject to government review could significantly limit or completely hinder our ability to offer
+or continue to offer securities to investors and could cause the value of such securities to significantly decline or be worthless. For
+a detailed description of the risks related to doing business in the PRC and Taiwan, and the offering, see Risks Related to Doing
+Business in the PRC and Risks Related to Doing Business in Taiwan in the Risk Factors section.
+
+ 
+
+The
+recent joint statement by the SEC and PCAOB, and the Holding Foreign Companies Accountable Act and the Accelerating the Holding Foreign
+Companies Accountable Act all call for additional and more stringent criteria to be applied to emerging market companies upon assessing
+the qualification of their auditors, especially the non-U.S. auditors who are not inspected by the PCAOB. Trading in our securities may
+be prohibited under the Holding Foreign Companies Accountable Act and the Accelerating the Holding Foreign Companies Accountable Act
+if the PCAOB determines that it cannot inspect or investigate completely our auditor, and that as a result, an exchange may determine
+to delist our securities. Our auditor is based in the U.S. and is subject to PCAOB inspection. It is not subject to the determinations
+announced by the PCAOB on December 16, 2021. Due to the recent developments in connection with the implementation of the Holding Foreign
+Companies Accountable Act and the Accelerating the Holding Foreign Companies Accountable Act, we cannot assure you whether the SEC or
+other regulatory authorities would apply additional and more stringent criteria to us after considering the effectiveness of our auditor s
+audit procedures and quality control procedures, adequacy of personnel and training, or sufficiency of resources, geographic reach or
+experience as it relates to the audit of our financial statements. The requirement in the HFCA Act that the PCAOB be permitted to inspect
+the issuer s public accounting firm within two or three years, may result in the delisting of our securities from applicable trading
+markets in the U.S, in the future if the PCAOB is unable to inspect our accounting firm at such future time.
+
+ 
+
+On
+August 26, 2022, the PCAOB announced that it had signed a Statement of Protocol (the SOP ) with the China Securities Regulatory
+Commission and the Ministry of Finance of China. The SOP, together with two protocol agreements governing inspections and investigations
+(together, the SOP Agreement ), establishes a specific, accountable framework to make possible complete inspections and
+investigations by the PCAOB of audit firms based in mainland China and Hong Kong, as required under U.S. law. The SOP Agreement remains
+unpublished and is subject to further explanation and implementation. Pursuant to the fact sheet with respect to the SOP Agreement disclosed
+by the SEC, the PCAOB shall have sole discretion to select any audit firms for inspection or investigation and the PCAOB inspectors and
+investigators shall have a right to see all audit documentation without redaction. According to the PCAOB, its December 2021 determinations
+under the HFCA Act remain in effect. The PCAOB is required to reassess these determinations by the end of 2022. Under the PCAOB s
+rules, a reassessment of a determination under the HFCA Act may result in the PCAOB reaffirming, modifying or vacating the determination.
+However, if the PCAOB continues to be prohibited from conducting complete inspections and investigations of PCAOB-registered
+public accounting firms in mainland China and Hong Kong, the PCAOB is likely to determine by the
+end of 2022 that positions taken by authorities in the PRC obstructed its ability to inspect and investigate registered public accounting
+firms in mainland China and Hong Kong completely, then the companies audited by those registered public accounting firms would be subject
+to a trading prohibition on U.S. markets pursuant to the HFCA Act. Please see Risk Factors- The Holding Foreign Companies
+Accountable Act requires the Public Company Accounting Oversight Board (PCAOB) to be permitted to inspect the issuer s public accounting
+firm within three years. There are uncertainties under the PRC Securities Law relating to the procedures and requisite timing for the
+U.S. securities regulatory agencies to conduct investigations and collect evidence within the territory of the PRC. If the U.S. securities
+regulatory agencies are unable to conduct such investigations, they may suspend or de-register our registration with the SEC and delist
+our securities from applicable trading market within the US. 
+
+ 
+
+Proposed
+PRC Cybersecurity Measures
+
+ 
+
+The amendment
+to the Cybersecurity Review Measures published by CAC on December 28, 2021, which has become effective on February 15, 2022 replaced
+the former Cybersecurity Review Measures. On November 14, 2021, the CAC released a draft of the Administrative Regulations on Network
+Data Security, or Draft Regulations, for public comments. The amended Cybersecurity Review Measures stipulate that, among other items,
+if an issuer is classified as a network platform operator and such issuer possesses personal information of more than one
+million users and intends to be listed on a securities exchange in a foreign country, it must complete a cybersecurity review. Alternatively,
+relevant governmental authorities in China may initiate a cybersecurity review if such governmental authorities determine an operator s
+cyber products or services, data processing or potential listing in a foreign country affect or may affect national security. The Draft
+Regulations also stipulate that, among other items, for any listing to be done on a securities exchange in a foreign country involving
+a data processing operator with personal information of more than one million users, such data processing operator 
+shall report to the CAC for a cybersecurity review. The Draft Regulations were released for public comment only, and the draft provisions
+and anticipated adoption or effective date
+
+ 17
+
+ 
+
+ 
+
+are subject to changes and thus its interpretation and implementation remain substantially
+uncertain. We cannot predict the impact of the draft measures, if any, on the operations of our Company at this stage.
+
+ 
+
+ Data
+processing operators is defined under the Draft Regulations as any individual or organization that autonomously determines
+the purpose and manner of the processing of network data and network platform operators is not defined under the
+amended Cybersecurity Review Measures. While the exact scope of network platform and data processing operators 
+remains unclear, the Chinese government authorities may have wide discretion in the interpretation and enforcement of these laws. Currently,
+the draft amended Cybersecurity Review Measures and the Draft Regulations have not materially affected our business and operations and
+we do not believe our business activities affect or may be interpreted to affect PRC s national security. As of the date of this
+prospectus, we have not been informed by any relevant Chinese government authorities that we are identified as or considered a network
+platform operator or data processing operator. We are not aware of any requirement that we should file for a cybersecurity
+review, nor have we received any inquiry, notice, warning, sanction in such respect or any regulatory objections to this offering.
+
+ 
+
+Our
+PRC counsel, Liuhe (Wenzhou) Law Firm, advised us that we are not subject to the cybersecurity
+review by the CAC for this offering, given that: (i) we mainly collect and store our users basic personal information and the
+number of such information is far less than one million and thus, we do not meet the standard for cybersecurity review(ii) we presently
+maintain and process all of the personal information data within the PRC; and (iii) data processed in our business is less likely to
+have a bearing on national security, thus it may not be classified as core or important data by the authorities. Therefore, we believe
+that we have complied with the regulations and policies issued by the CAC as of the date of this prospectus. 
+
+ 
+
+However,
+it remains uncertain as to how the Cybersecurity Review Measures will be interpreted or implemented and whether the PRC regulatory agencies,
+including the CAC, may adopt new laws, regulations, rules, or detailed implementation and interpretation related to the Cybersecurity
+Review Measures. If any such new laws, regulations, rules, or implementation and interpretation come into effect, we expect to take all
+reasonable measures and actions to comply therewith. However, we cannot assure you that PRC regulatory agencies, including the CAC, would
+take the same view as we do, and we will not be subject to the cybersecurity review by the CAC or designated as a critical information
+infrastructure operator (CIIO). We may experience disruptions to our operations should we be required to have a cybersecurity review
+by the CAC. Any cybersecurity review could also result in uncertainty to our quotation on the OTCQB board, negative impacts on our share
+trading prices and diversion of our managerial and financial resources. For additional information, see Risk Factors––Risks
+related to Our Business and Industry—Our failure to comply with data protection laws and regulations could lead to government enforcement
+actions and significant penalties against us, and adversely impact our operating results, Risk Factors — Risks Related
+to Conducting Operations in PRC —Compliance with China s new Data Security Law, Cybersecurity Review Measures, Personal Information
+Protection Law, regulations and guidelines relating to the multi-level protection scheme and any other future laws and regulations may
+entail significant expenses and could materially affect our business, and Risk Factors — Risks Related to Doing Business
+in the PRC — The approval of the CSRC or other Chinese regulatory agencies may be required in connection with this offering under
+Chinese law. 
+
+ 
+
+PRC
+Regulations on Tax
+
+ 
+
+Enterprise
+Income Tax
+
+ 
+
+The Enterprise
+Income Tax Law of the People s Republic of China (the EIT Law ) was promulgated by the Standing Committee of the
+National People s Congress on March 16, 2007 and became effective on January 1, 2008, and was later amended on
+February 24, 2017. The Implementation Rules of the EIT Law (the Implementation Rules ) were promulgated by
+the State Council on December 6, 2007 and became effective on January 1, 2008. According to the EIT Law and the
+Implementation Rules, enterprises are divided into resident enterprises and non-resident enterprises. Resident enterprises shall pay
+enterprise income tax on their incomes obtained in and outside the PRC at the rate of 25%. Non-resident enterprises setting up
+institutions in the PRC shall pay enterprise income tax on the incomes obtained by such institutions in and outside the PRC at the
+rate of 25%. Non-resident enterprises with no institutions in the PRC, and non-resident enterprises whose incomes having no
+substantial connection with their institutions in the PRC, shall pay enterprise income tax on their incomes obtained in the PRC at a
+reduced rate of 10%. The Arrangement between the PRC and Hong Kong Special Administrative Region for the Avoidance of Double
+Taxation the Prevention of Fiscal Evasion with respect to Taxes on Income (the Arrangement ) was promulgated by the
+State Administration of Taxation ( SAT ) on August 21, 2006 and came into effect on December 8, 2006.
+According to the Arrangement, a company incorporated in Hong Kong will be subject to withholding tax at the lower rate of 5% on
+dividends it receives from a company incorporated in the PRC if it holds a 25% interest or more in the PRC company. The Notice on
+the Understanding and Identification of the Beneficial Owners in the Tax Treaty (the Notice ) was promulgated by
+SAT and became effective on October 27, 2009. According to the Notice, a beneficial ownership analysis will be used based on a
+substance-over-form principle to determine whether to grant tax treaty benefits.
+
+ 18
+
+ 
+
+ 
+
+In
+April 2009, the Ministry of Finance, or MOF, and SAT jointly issued the Notice on Issues Concerning Process of Enterprise Income
+Tax in Enterprise Restructuring Business, or Circular 59. In December 2009, SAT issued the Notice on Strengthening Administration
+of Enterprise Income Tax for Share Transfers by Non-PRC Resident Enterprises, or Circular 698. Both Circular 59 and Circular 698
+became effective retroactively as of January 2008. In February 2011, SAT issued the Notice on Several Issues Regarding the
+Income Tax of Non-PRC Resident Enterprises, or SAT Circular 24, effective April 2011. By promulgating and implementing these
+circulars, the PRC tax authorities have enhanced their scrutiny over the direct or indirect transfer of equity interests in a PRC resident
+enterprise by a non-resident enterprise.
+
+ 
+
+Under
+Circular 698, where a non-resident enterprise conducts an indirect transfer by transferring the equity interests of a PRC
+ resident enterprise indirectly by disposing of the equity interests of an overseas holding company, the non-resident enterprise,
+being the transferor, may be subject to PRC enterprise income tax, if the indirect transfer is considered to be an abusive use of company
+structure without reasonable commercial purposes. As a result, gains derived from such indirect transfer may be subject to PRC tax at
+a rate of up to 10%. Circular 698 also provides that, where a non-PRC resident enterprise transfers its equity interests in a PRC resident
+enterprise to its related parties at a price lower than the fair market value, the relevant tax authority has the power to make a reasonable
+adjustment to the taxable income of the transaction.
+
+ 
+
+In
+February 2015, the SAT issued Circular 7 to replace the rules relating to indirect transfers in Circular 698. Circular 7 has introduced
+a new tax regime that is significantly different from that under Circular 698. Circular 7 extends its tax jurisdiction to not only indirect
+transfers set forth under Circular 698 but also transactions involving transfer of other taxable assets, through the offshore transfer
+of a foreign intermediate holding company. In addition, Circular 7 provides clearer criteria than Circular 698 on how to assess reasonable
+commercial purposes and has introduced safe harbors for internal group restructurings and the purchase and sale of equity through a public
+securities market. Circular 7 also brings challenges to both the foreign transferor and transferee (or other person who is obligated
+to pay for the transfer) of the taxable assets. Where a non-resident enterprise conducts an indirect transfer by transferring
+the taxable assets indirectly by disposing of the equity interests of an overseas holding company, the non-resident enterprise being
+the transferor, or the transferee, or the PRC entity which directly owned the taxable assets may report to the relevant tax authority
+such indirect transfer. Using a substance over form principle, the PRC tax authority may disregard the existence of the
+overseas holding company if it lacks a reasonable commercial purpose and was established for the purpose of reducing, avoiding or deferring
+PRC tax. As a result, gains derived from such indirect transfer may be subject to PRC enterprise income tax, and the transferee or other
+person who is obligated to pay for the transfer is obligated to withhold the applicable taxes, currently at a rate of 10% for the transfer
+of equity interests in a PRC resident enterprise.
+
+ 
+
+On
+October 17, 2017, the SAT issued a Notice Concerning Withholding Income Tax of Non-Resident Enterprise, or SAT Notice No. 37,
+which abolishes Circular 698 and certain provisions of Circular 7. SAT Notice No. 37 reduces the burden of the withholding
+obligator, such as revocation of contract filing requirements and tax liquidation procedures, strengthens the cooperation of tax authorities
+in different places, and clarifies the calculation of tax payable and mechanism of foreign exchange. 
+
+ 
+
+Value-added
+Tax
+
+ 
+
+Pursuant
+to the Provisional Regulations on Value-added Tax of the PRC, or the VAT Regulations, which were promulgated by the State Council on
+December 13, 1993, took effect on January 1, 1994, and were amended on November 10, 2008, February 6, 2016, and November 19, 2017, respectively,
+and the Rules for the Implementation of the Provisional Regulations on Value-added Tax of the PRC, which were promulgated by the MOF
+on December 25, 1993, and were amended on December 15, 2008, and October 28, 2011, respectively, entities and individuals that sell goods
+or labor services of processing, repair or replacement, sell services, intangible assets, or immovables, or import goods within the territory
+of the People s Republic of China are taxpayers of value-added tax. The VAT rate is 17% for taxpayers selling goods, labor
+services, or tangible movable property leasing services or importing goods, except otherwise specified; 11% for taxpayers selling services
+of transportation, postal, basic telecommunications, construction, and lease of immovable, selling immovable, transferring land use rights,
+selling, and importing other specified goods including fertilizers; 6% for taxpayers selling services or intangible assets.
+
+ 
+
+According
+to the Notice on the Adjustment to the Value-added Tax Rates issued by the SAT and the MOF on April 4, 2018, where taxpayers make VAT
+taxable sales or import goods, the applicable tax rates shall be adjusted from 17% to 16% and from 11% to 10%, respectively. Subsequently,
+the Notice on Policies for Deepening Reform of Value-added Tax was issued by the SAT, the MOF and the General Administration of Customs
+on March 30, 2019 and took effective on April 1, 2019, which further adjusted the applicable tax rate for taxpayers making VAT taxable
+sales or importing goods. The applicable tax rates shall be adjusted from 16% to 13% and from 10% to 9%, respectively.
+
+ 19
+
+ 
+
+ 
+
+Dividend
+Withholding Tax
+
+ 
+
+The
+Enterprise Income Tax Law provides that since January 1, 2008, an income tax rate of 10% will normally be applicable to dividends
+declared to non-PRC resident investors that do not have an establishment or place of business in the PRC, or that have such establishment
+or place of business but the relevant income is not effectively connected with the establishment or place of business, to the extent
+such dividends are derived from sources within the PRC.
+
+ 
+
+PRC
+Laws and Regulations on Employment and Social Welfare
+
+ 
+
+Labor
+Law of the PRC
+
+ 
+
+Pursuant
+to the Labor Law of the PRC, which was promulgated by the Standing Committee of the NPC on July 5, 1994 with an effective date of
+January 1, 1995 and was last amended on August 27, 2009 and the Labor Contract Law of the PRC, which was promulgated on June 29,
+2007, became effective on January 1, 2008 and was last amended on December 28, 2012, with the amendments coming into effect
+on July 1, 2013, enterprises and institutions shall ensure the safety and hygiene of a workplace, strictly comply with applicable rules
+and standards on workplace safety and hygiene in China, and educate employees on such rules and standards. Furthermore, employers and
+employees shall enter into written employment contracts to establish their employment relationships. Employers are required to inform
+their employees about their job responsibilities, working conditions, occupational hazards, remuneration and other matters with which
+the employees may be concerned. Employers shall pay remuneration to employees on time and in full accordance with the commitments set
+forth in their employment contracts and with the relevant PRC laws and regulations. Our China subsidiaries currently comply with PRC
+laws and regulations.
+
+ 
+
+Social
+Insurance and Housing Fund
+
+ 
+
+Pursuant
+to the Social Insurance Law of the PRC, which was promulgated by the Standing Committee of the NPC on October 28, 2010 and
+became effective on July 1, 2011, employers in the PRC shall provide their employees with welfare schemes covering basic pension
+insurance, basic medical insurance, unemployment insurance, maternity insurance, and occupational injury insurance. Our Hong Kong subsidiary
+has not deposited the social insurance fees in full for all the employees in compliance with the relevant regulations. We may be ordered
+by the social security premium collection agency to make or supplement contributions within a stipulated period, and shall be subject
+to a late payment fine computed from the due date at the rate of 0.05% per day; where payment is not made within the stipulated period,
+the relevant administrative authorities shall impose a fine ranging from one to three times the amount of the amount in arrears. Our
+China subsidiaries have deposited the social insurance fees as required by relevant regulations.
+
+ 
+
+In
+accordance with the Regulations on Management of Housing Provident Fund, which were promulgated by the State Council on April 3,
+1999 and last amended on March 24, 2002, employers must register at the designated administrative centers and open bank accounts
+for depositing employees housing funds. Employers and employees are also required to pay and deposit housing funds, with an amount
+no less than 5% of the monthly average salary of the employee in the preceding year in full and on time. Our subsidiaries have not registered
+at the designated administrative centers nor opened bank accounts for depositing employees housing funds. They also have not deposited
+employees housing funds. Our subsidiaries may be ordered by the housing provident fund management center to complete the registration
+formalities, open bank accounts, make the payment and deposit within a prescribed time limit if they become subject to PRC laws. Failing
+to register or open bank accounts at the expiration of the time limit could result in fines of not less than 10,000 yuan nor more than
+50,000 yuan. And an application may be made to a people s court for compulsory enforcement if payment and deposit has not been
+made after the expiration of the time limit.
+
+ 
+
+PRC
+Regulations Relating to Foreign Exchange 
+
+ 
+
+General
+Administration of Foreign Exchange
+
+ 
+
+The
+principal regulation governing foreign currency exchange in the PRC is the Administrative Regulations of the PRC on Foreign Exchange (the
+ Foreign Exchange Regulations ), which were promulgated on January 29, 1996, became effective on April 1, 1996
+and were last amended on August 5, 2008. Under these rules, Renminbi is generally freely convertible for payments of current account
+items, such as trade- and service-related foreign exchange transactions and dividend payments, but not freely convertible for capital
+account items, such as capital transfer, direct investment, investment in securities, derivative products or loans unless prior approval
+by competent authorities for the administration of foreign exchange is obtained. Under the Foreign Exchange Regulations, foreign-invested
+enterprises in the PRC may purchase foreign exchange without the approval of SAFE to pay dividends by providing certain evidentiary documents,
+including board resolutions, tax certificates, or for trade- and services-related foreign exchange transactions, by providing commercial
+documents evidencing such transactions.
+
+ 20
+
+ 
+
+ 
+
+Circular
+No. 37 and Circular No. 13
+
+ 
+
+Circular
+37 was released by SAFE on July 4, 2014 and abolished Circular 75 which had been in effect since November 1, 2005. Pursuant
+to Circular 37, a PRC resident should apply to SAFE for foreign exchange registration of overseas investments before it makes any capital
+contribution to a special purpose vehicle, or SPV, using his or her legitimate domestic or offshore assets or interests. SPVs are offshore
+enterprises directly established or indirectly controlled by domestic residents for the purpose of investment and financing by utilizing
+domestic or offshore assets or interests they legally hold. Following any significant change in a registered offshore SPV, such as capital
+increase, reduction, equity transfer or swap, consolidation or division involving domestic resident individuals, the domestic individuals
+shall amend the registration with SAFE. Where an SPV intends to repatriate funds raised after completion of offshore financing to the
+PRC, it shall comply with relevant PRC regulations on foreign investment and foreign debt management. A foreign-invested enterprise
+established through return investment shall complete relevant foreign exchange registration formalities in accordance with the prevailing
+foreign exchange administration regulations on foreign direct investment and truthfully disclose information on the actual controller
+of its shareholders.
+
+ 
+
+If
+any shareholder who is a PRC resident (as determined by the Circular No. 37) holds any interest in an offshore SPV and fails to fulfil
+the required foreign exchange registration with the local SAFE branches, the PRC subsidiaries of that offshore SPV may be prohibited
+from distributing their profits and dividends to their offshore parent company or from carrying out other subsequent cross-border foreign
+exchange activities. The offshore SPV may also be restricted in its ability to contribute additional capital to its PRC subsidiaries.
+Where a domestic resident fails to complete relevant foreign exchange registration as required, fails to truthfully disclose information
+on the actual controller of the enterprise involved in the return investment or otherwise makes false statements, the foreign exchange
+control authority may order them to take remedial actions, issue a warning, and impose a fine of less than RMB 300,000 on an institution
+or less than RMB 50,000 on an individual.
+
+ 
+
+Circular
+13 was issued by SAFE on February 13, 2015, and became effective on June 1, 2015. Pursuant to Circular 13, a domestic resident
+who makes a capital contribution to an SPV using his or her legitimate domestic or offshore assets or interests is no longer required
+to apply to SAFE for foreign exchange registration of his or her overseas investments. Instead, he or she shall register with a bank
+in the place where the assets or interests of the domestic enterprise in which he or she has interests are located if the domestic resident
+individually seeks to make a capital contribution to the SPV using his or her legitimate domestic assets or interests; or he or she shall
+register with a local bank at his or her permanent residence if the domestic resident individually seeks to make a capital contribution
+to the SPV using his or her legitimate offshore assets or interests.
+
+ 
+
+We
+cannot assure that our PRC beneficial shareholders have completed registrations in accordance with Circular 37.
+
+ 
+
+Circular
+19 and Circular 16
+
+ 
+
+Circular
+19 was promulgated by SAFE on March 30, 2015, and became effective on June 1, 2015. According to Circular 19, the foreign exchange
+capital in the capital account of foreign-invested enterprises, meaning the monetary contribution confirmed by the foreign exchange authorities
+or the monetary contribution registered for account entry through banks, shall be granted the benefits of Discretional Foreign Exchange
+Settlement ( Discretional Foreign Exchange Settlement ). With Discretional Foreign Exchange Settlement, foreign capital in
+the capital account of a foreign-invested enterprise for which the rights and interests of monetary contribution have been confirmed
+by the local foreign exchange bureau, or for which book-entry registration of monetary contribution has been completed by the bank, can
+be settled at the bank based on the actual operational needs of the foreign-invested enterprise. The allowed Discretional Foreign Exchange
+Settlement percentage of the foreign capital of a foreign-invested enterprise has been temporarily set to be 100%. The Renminbi
+converted from the foreign capital will be kept in a designated account and if a foreign-invested enterprise needs to make any further
+payment from such account, it will still need to provide supporting documents and to complete the review process with its bank.
+
+ 
+
+Furthermore,
+Circular 19 stipulates that foreign-invested enterprises shall make bona fide use of their capital for their own needs within their business
+scopes. The capital of a foreign-invested enterprise and the Renminbi it obtained from foreign exchange settlement shall not be used
+for the following purposes:
+
+ 
+
+ 
+ 
+ 
+ directly
+ or indirectly used for expenses beyond its business scope or prohibited by relevant laws or regulations; 
+
+ 
+ 
+
+ 
+ 
+ 
+ directly
+ or indirectly used for investment in securities unless otherwise provided by relevant laws or regulations; 
+
+ 
+ 
+
+ 
+ 
+ 
+ directly
+ or indirectly used for entrusted loan in Renminbi (unless within its permitted scope of business), repayment of inter-company loans
+ (including advances by a third party) or repayment of bank loans in Renminbi that have been sub-lent to a third party; or 
+
+ 
+ 
+
+ 
+ 
+ 
+ directly
+ or indirectly used for expenses related to the purchase of real estate that is not for self-use (except for foreign-invested real
+ estate enterprises). 
+
+ 
+
+ 21
+
+ 
+
+ 
+
+Circular
+16 was issued by SAFE on June 9, 2016. Pursuant to Circular 16, enterprises registered in the PRC may also convert their foreign
+debts from foreign currency to Renminbi on a self-discretionary basis. Circular 16 provides an integrated standard for conversion of
+foreign exchange capital items (including but not limited to foreign currency capital and foreign debts) on a self-discretionary basis
+applicable to all enterprises registered in the PRC. Circular 16 reiterates the principle that an enterprise s Renminbi capital
+converted from foreign currency-denominated capital may not be directly or indirectly used for purposes beyond its business scope or
+purposes prohibited by PRC laws or regulations, and such converted Renminbi capital shall not be provided as loans to non-affiliated
+entities.
+
+ 
+
+Our
+PRC subsidiaries distributions to their offshore parents are required to comply with the requirements as described above.
+
+ 
+
+PRC
+Share Option Rules 
+
+ 
+
+Under
+the Administration Measures on Individual Foreign Exchange Control issued by the PBOC on December 25, 2006, all foreign exchange matters
+involved in employee share ownership plans and share option plans in which PRC citizens participate require approval from SAFE or its
+authorized branch. Pursuant to SAFE Circular 37, PRC residents who participate in share incentive plans in overseas non-publicly-listed
+companies may submit applications to SAFE or its local branches for the foreign exchange registration with respect to offshore special
+purpose companies. In addition, under the Notices on Issues concerning the Foreign Exchange Administration for Domestic Individuals Participating
+in Share Incentive Plans of Overseas Publicly-Listed Companies, or the Share Option Rules, issued by SAFE on February 15, 2012, PRC residents
+who are granted shares or share options by companies listed on overseas stock exchanges under share incentive plans are required to (i)
+register with SAFE or its local branches, (ii) retain a qualified PRC agent, which may be a PRC subsidiary of the overseas listed company
+or another qualified institution selected by the PRC subsidiary, to conduct the SAFE registration and other procedures with respect to
+the share incentive plans on behalf of the participants, and (iii) retain an overseas institution to handle matters in connection with
+their exercise of share options, purchase and sale of shares or interests and funds transfers.
+
+ 
+
+PRC
+Regulation of Dividend Distributions
+
+ 
+
+The
+principal laws, rules and regulations governing dividend distributions by foreign-invested enterprises in the PRC are the Company Law
+of the PRC, as amended, the Wholly Foreign-owned Enterprise Law and its implementation regulations, the Chinese-foreign Cooperative Joint
+Venture Law and its implementation regulations, and the Chinese-foreign Equity Joint Venture Law and its implementation regulations.
+Under these laws, rules and regulations, foreign-invested enterprises may pay dividends only out of their accumulated profit, if any,
+as determined in accordance with PRC accounting standards and regulations. Both PRC domestic companies and wholly-foreign owned PRC enterprises
+are required to set aside a general reserve of at least 10% of their after-tax profit, until the cumulative amount of such reserve reaches
+50% of their registered capital. A PRC company is not permitted to distribute any profits until any losses from prior fiscal years have
+been offset. Profits retained from prior fiscal years may be distributed together with distributable profits from the current fiscal
+year.
+
+ 
+
+Corporate
+Control
+
+ 
+
+We
+have adopted a share structure consisting of common shares and Preferred Shares. In respect of matters requiring the votes of shareholders,
+each common share is entitled to one vote and each Preferred Share is entitled to fifty (50) votes. Each Preferred Shares may be converted
+into ten (10) common shares by its holder.
+
+ 
+
+We
+have authorized 5,000,000 Preferred Shares and Honetech Inc, a Samoa company, beneficially owns all of the 832,200 issued and outstanding
+Preferred Shares. Mr. Yun-Kuang Kung through the appointment by Honetech Inc, exercise the voting power of these preferred stock. Therefore,
+Honetech Inc and Yun-Kuang Kung both control 41,600,000 votes, which constitute approximately 54.7% of the aggregate voting power of
+the Company assuming we are able to successfully sell all the 10,000,000 shares registered in this Prospectus.
+
+ 22
+
+ 
+
+ 
+
+THE
+OFFERING
+
+ 
+ 
+ 
+
+ 
+ Securities
+ offered by us:
+ 10,000,000
+ shares of our common shares, par value $ 0.001 per share. (1)
+
+ 
+ 
+ 
+
+ 
+ Offering
+ price:
+ $1.00
+
+ 
+ 
+ 
+
+ 
+ Duration
+ of offering:
+ 12
+ months
+
+ 
+ 
+ 
+
+ 
+ Net
+ proceeds to us:
+ $10,000,000
+ assuming the maximum number of shares sold. Such $10,000,000 in net proceeds does not account for the offering expenses in this offering.
+ We estimate that we will bear offering expenses of 1%of gross proceeds. For further information on the Use of Proceeds, see
+ page 40.
+
+ 
+ 
+ 
+
+ 
+ Market
+ for the common shares:
+ Our
+ common share is already quoted on the OTCQB market or the OTC markets. There is no assurance that a trading market will develop,
+ or, if developed, that it will be sustained. Consequently, a purchaser of our common shares may find it difficult to resell the securities
+ offered herein should the purchaser desire to do so when eligible for public resale.
+
+ 
+ 
+ 
+
+ 
+ Shares
+ outstanding prior to offering:
+ 25,546,810
+ 
+
+ 
+ 
+ 
+
+ 
+ Shares
+ outstanding after offering:
+ 35,546,810
+ (assuming all 10,000,000 shares are sold)
+
+ 
+ 
+
+ Transfer
+ Agent
+
+ Dynamic
+ Stock Transfer, Inc.
+
+ 14542
+ Ventura Blvd., Suite 205
+
+ Sherman
+ Oaks, CA 91403
+
+ 
+ 
+ 
+
+ 
+ Risk
+ Factors:
+ The
+ common shares offered hereby involves a high degree of risk and should not be purchased by investors who cannot afford the loss of
+ their entire investment. See Risk Factors on page 25 to 40.
+
+ 
+ 
+
+(1)We
+are also concurrently registering for resale under a separate prospectus up to 10,986,204 common shares held by the selling shareholders
+named under the prospectus. None of the shares is being offered by us and we will not receive any proceeds from the sales.
+
+ 
+
+(2)You
+should be aware that our share price on OTC Market quotations reflect inter-dealer prices only, without retail mark-up, mark-down or
+commission and may not necessarily represent actual transactions.
+
+ 23
+
+ 
+
+ 
+
+Summary
+of Consolidated Financial Information 
+
+ 
+
+The
+following summary of financial information includes the data from the audited consolidated financial statements as of December 31,
+2021 and unaudited financial statements as of September 30, 2022 and 2021. We have changed the fiscal year end from April 30 to
+December 31 in 2019. You should read them in conjunction with the related notes in our Form 10-K for the quarters ended December 31,
+2021 (audited), and the information under Management s Discussion and Analysis of Financial Condition and Results of
+Operations included elsewhere in this Prospectus.
+
+ 
+
+ 
+ 
+ September 30, 2022 
+ December 31, 2021 
+
+ 
+ 
+ (Unaudited) 
+ 
+
+ 
+ ASSETS 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Cash and cash equivalents 
+ $57,817 
+ $80,306 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total current assets 
+ 1,880,858 
+ 539,688 
+
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL ASSETS 
+ $2,568,391 
+ $1,452,084 
+
+ 
+ 
+ 
+ 
+
+ 
+ LIABILITIES AND SHAREHOLDERS DEFICIT 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total Liabilities 
+ 3,397,402 
+ 1,549,475 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total shareholders deficit 
+ (829,011) 
+ (97,391)
+
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL LIABILITIES AND SHAREHOLDERS DEFICIT 
+ $2,568,391 
+ $1,452,084 
+
+ 
+
+ 
+
+ 
+ 
+ Three months ended 
+September 30, 
+ Nine months ended 
+September 30, 
+
+ 
+ 
+ 2022 
+ 2021 
+ 2022 
+ 2021 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ REVENUE 
+ $25,479 
+ $109,957 
+ $37,347 
+ $178,931 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Total operating expenses 
+ (283,016) 
+ (321,310) 
+ (847,387) 
+ (763,397)
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Loss from operations 
+ (286,348) 
+ (254,203) 
+ (848,741) 
+ (866,903)
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Total other income (expense) 
+ (1,965) 
+ (120,104) 
+ 52,292 
+ (1,325,447)
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Loss before income taxes 
+ (288,313) 
+ (374,307) 
+ (796,449) 
+ (2,192,350)
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Income taxes 
+ - 
+ 459 
+ 9 
+ 459 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ NET LOSS 
+ (288,313) 
+ (374,766) 
+ (796,458) 
+ (2,192,809)
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Net loss attributable to non-controlling interest 
+ (3,312) 
+ (14,384) 
+ (37,870) 
+ (82,949)
+
+ 
+ Net loss attributable to Vivic Corp. 
+ $(285,001) 
+ $(360,382) 
+ $(758,588) 
+ $(2,109,860)
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Other comprehensive gain (loss): 
+ 
+ 
+ 
+ 
+
+ 
+ Foreign currency translation gain (loss) 
+ 16,771 
+ (49) 
+ 12,838 
+ 2,840 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ COMPREHENSIVE LOSS 
+ $(268,230) 
+ $(360,431) 
+ $(745,750) 
+ $(2,107,020)
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Net loss per share – Basic and Diluted 
+ $(0.01) 
+ $(0.01) 
+ $(0.03) 
+ $(0.09)
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Weighted average common shares outstanding – Basic
+ and Diluted 
+ 25,546,810 
+ 25,496,209 
+ 25,550,253 
+ 25,132,189 
+
+ 
+
+ 24
+
+ 
+
+ 
+
+ 
+ 
+ As of 
+ December 31, 2021
+ 
+ As of 
+ December 31,2020
+ 
+
+ 
+ 
+ $ 
+ $ 
+
+ 
+ Balance Sheets 
+ 
+ 
+
+ 
+ Cash and cash equivalents 
+ 80,306 
+ 504,179 
+
+ 
+ Total Assets 
+ 1,452,084 
+ 881,685 
+
+ 
+ Total Liabilities 
+ 1,549,475 
+ 733,675 
+
+ 
+ Total Shareholders Equity / (Deficit) 
+ (97,391) 
+ 148,010 
+
+ 
+ 
+ 
+ 
+
+ 
+ For the year ended
+ December 31, 2021
+ 
+ For the year ended
+ December 31, 2020
+ 
+
+ 
+ 
+ $ 
+ $ 
+
+ 
+ Statement of Operations 
+ 
+ 
+
+ 
+ Revenue 
+ 244,191 
+ 243,508 
+
+ 
+ Cost of revenue 
+ (366,852) 
+ (3,913)
+
+ 
+ Total operating expenses 
+ (1,263,691) 
+ (1,261,761)
+
+ 
+ Total other income / (expenses) 
+ (1,276,018) 
+ 34,642 
+
+ 
+ Income tax expenses 
+ - 
+ - 
+
+ 
+ Net loss 
+ (2,662,829) 
+ (987,524)
+
+ 
+ Net income / (loss) attributable to non-controlling interest 
+ (97,884) 
+ (31,807)
+
+ 
+ Net income / (loss) attributable to Vivic Corp. 
+ (2,564,945) 
+ (955,717)
+
+ 
+ Other Comprehensive income / (loss) 
+ 12,587 
+ (921)
+
+ 
+ Comprehensive income / (loss) 
+ (2,552,358) 
+ (956,638)
+
+ 
+ Net income / (loss) per share – Basic and Diluted 
+ (0.10) 
+ (0.06)
+
+ 
+ Weighted average common share outstanding - Basic and
+ Diluted 
+ 25,240,065 
+ 15,989,299 
+
+ 
+
+ 25
+
+ 
+
+ 
+
+RISK
+FACTORS
+
+ 
+
+The
+reader should carefully consider the risks described below together with all of the other information included in this Prospectus. Some
+of these risks relate principally to the Offering, while others relate principally to our business and the industry in which we operate
+or to the securities markets generally and ownership of our securities specifically. The statements contained in this Prospectus that
+are not historic facts are forward-looking statements that are subject to risks and uncertainties that could cause actual results to
+differ materially from those set forth in or implied by forward-looking statements. If any of the following risks actually occurs, our
+business, financial condition, or results of operations could be harmed. In that case, the trading price of our common shares, if and
+when a market for our common shares develops, could decline, and an investor in our securities may lose all or part of their investment.
+
+ 
+
+Risks
+Related to Our Business
+
+ 
+
+We
+may not be able to compete effectively against our competitors.
+
+ 
+
+We
+face competition from well-established companies and small independent companies. We will be at a competitive disadvantage in obtaining
+the facilities, staffing, financing and other resources required to provide our services and products to customers. Our opportunity to
+obtain customers may be limited by our financial resources and other assets. Our main competitors in marine tourism likely are Jetpon
+Yacht Club, Lucky Bay Yacht Club and Ocean Blue Hatch Company.
+
+ 
+
+We
+also face keen competition in the prospective business that we intend to engage, including manufacture and sales in energy-saving engines
+and yachts, marina development and operation. In the energy-saving engines business, we believe that our main competitors are ERIC Boating,
+HENSEN Yacht Company and Ikung Yacht Company. In the marina development and operation business, our main competitors likely are Seven
+Star Marina in Shenzhen, Shenzhen Bay Yacht Marina and Wuyuan Bay Yacht Marina. In the yacht manufacturing business, our main competitors
+likely are Jetpon Yacht Club, HAISEA Yacht Company and HENSEN Yacht Company.
+
+ 
+
+Many
+of our main competitors are well-established companies with reputation in the respective industries. Therefore, there is no assurance
+that we will be able to effectively compete against those competitors.
+
+ 
+
+Our
+independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern.
+
+ 
+
+The
+report of our independent registered public accounting firm contains a note stating that the accompanying financial statements have
+been prepared assuming we will continue as a going concern. The Company has suffered from net loss of $2,662,829 during the
+year ended December 31, 2021. Also, the Company has incurred the accumulated deficits of $4,624,083 and working capital deficit of
+$1,165,695 as of September 30,2022. The Company had $57,817 cash and cash equivalents and working capital deficit of $1,165,695 as
+of September 30, 2022 and net loss of $796,458 during the nine months ended September 30, 2022. Losses have principally occurred as
+a result of our business development and operations efforts coupled with limited operating revenues.
+
+ 
+
+Without
+raising capital, there is a substantial doubt about our ability to continue as a going concern through November 15, 2023.
+
+ 
+
+Declines
+or disruptions in the tourism industry generally could reduce our revenues.
+
+ 
+
+We
+strongly rely on the health and growth of the tourism industry. Tourism is highly sensitive to business and personal discretionary spending
+levels, and thus tends to decline during general economic downturns. In addition, other adverse trends or events that tend to reduce
+tourism are likely to reduce our revenues. Also, due to the nature of our business, we may be subject to liability claims arising out
+of accidents or disasters causing injury to our customers, including claims for serious personal injury or death. There can be no assurance
+that we will be able to obtain sufficient insurance coverage at acceptable premium levels in the future. Successful assertion against
+us of one or a series of large uninsured claims, or of one or a series of claims exceeding our insurance, could adversely affect our
+business, financial condition, and results of operations.
+
+ 
+
+The
+lack of intellectual property protection might cause adverse impact to our business,
+
+ 
+
+We
+already have a trademark in China and will continue the process of applying trademarks in Taiwan and US. There is no assurance that the
+trademark registration can be obtained timely.
+
+ 26
+
+ 
+
+ 
+
+Our
+lack of revenues and limited operations cause us unable to afford to establish an audit committee.
+
+ 
+
+We
+are unable to afford establishing an audit committee due to limited operations and lack of revenue.
+
+ 
+
+We
+may require additional capital to fund the expansion of our business, and our inability to obtain such capital could harm our business.
+
+ 
+
+To
+support our expanding business, we must have sufficient capital to continue to make significant investments in our existing products
+and advertising. We cannot assure you that cash generated by our operations will be sufficient to allow us to fund such expansion. If
+cash flows from operations are not sufficient, we may need additional equity or debt financing to provide the funds required to expand
+our business. If such financing is not available on satisfactory terms or at all, we may be unable to expand our business or to develop
+new business at the rate desired and our operating results may suffer. Debt financing increases expenses, may contain covenants that
+restrict the operation of our business, and must be repaid regardless of operating results. Equity financing, or debt financing that
+is convertible into equity, could result in additional dilution to our existing stockholders.
+
+ 
+
+Our
+inability to obtain adequate capital resources, whether in the form of equity or debt, to fund our business and growth strategies may
+require us to delay, scale back or eliminate some or all our operations or the expansion of our business, which may have a material adverse
+effect on our business, operating results, financial condition, or prospects.
+
+ 
+
+We
+don t have any substantial asset in the United States and may not be able to own substantial assets in the United States in the
+near future.
+
+ 
+
+As
+a Nevada corporation, we plan to be able to carry out business in the United States eventually. However, currently we don t have
+any substantial assets in the U.S. and we may not be able to own any substantial assets in the near future. Lack of substantial assets
+will make it difficult for us to launch business operations and delay the execution of our business plans in the U.S.
+
+ 
+
+If
+our land use rights are revoked, we would have no operational capabilities or ability to conduct our business.
+
+ 
+
+Under
+PRC law, land is owned by state or rural collective economic organizations. The State issues tenants the rights to use property. Rights
+to use property can be revoked and tenants can be forced to vacate at any time when redevelopment of the land is in the public interest.
+The public interest rationale is interpreted broadly and the process of land appropriation may be less than transparent. We rely on these
+land use rights as the cornerstone of our operations, and the loss of such rights would have a detrimental effect on our business.
+
+ 
+
+COVID-19
+pandemic may cause significant impact to our business operations.
+
+ 
+
+Our
+business had been adversely affected by the outbreak of the COVID-19 pandemic. Both China and Taiwan governments have imposed various
+strict measures including, but not limited to, travel restrictions, mandatory quarantine requirements, and postponed resumption of business
+operations. Considering the features of our business in the tourism and recreation industries, we have been experiencing business downturn
+due to the COVID-19 pandemic outbreak. Further, COVID-19 pandemic leads to worldwide health crisis, it has been harmfully influencing
+the global economy and financial markets. The COVID-19 pandemic has not been effectively controlled so far, our businesses, results of
+operations and net loss in 2021 may be worse than that in 2020 and 2019. The Company s major income sources has been coming from
+consultation services to the yacht marina operators which has been largely affected due to government emergency policies to control leisure
+travel and activities. Most yacht marina operations of our clients have been stopped during the COVID-19 pandemic which has imposed direct
+negative effect to the Company s income during the COVID-19 pandemic. We expect our consultation business will resume once the
+COVID-19 pandemic will go away with government policies begin to allow some leisure travel and activities to resume most of the yacht
+marina operations in China and Taiwan.
+
+ 
+
+Our
+exclusive dealership agreement with Kha Shing in China may make it harder for us to sell other brands of yachts
+
+ 
+
+On
+September 18,2019, we entered into an exclusive dealership and sales agreement with Kha Shing Enterprise Co., LTD, a leading and a renowned
+yacht and recreational boat builder based in Taiwan. In the agreement, we were granted an exclusive period of five years to sell Monte
+Fino Yachts manufactured by Kha Shing. Our connection with Kha Shing makes it easier for us to sell and market famous yacht brands in
+China. Although the dealership agreement does not forbid us to sell other brands of yachts, we prefer to sell or promote Kha Shing s
+Monte Fino brand in the first place. The reliance on selling Kha Shing yachts makes us subject to supplier concentration risk. Although
+we are beginning to sell other brand, such as Norseman, it will take time for our customers to recognize accept the Norseman brand. In
+the meantime, we are researching and developing all-electric yachts, but we cannot guarantee you that we are able to bring all-electric
+yacht products to the market. If Kha Shing decides not to extend the exclusive dealership agreement with us at expiration, we will be
+at a less advantageous position compared with our competitors. Any change or termination of the
+dealership agreement could adversely affect product availability, cost and our financial performance.
+
+ 27
+
+ 
+
+ 
+
+We
+may require additional capital to fund the expansion of our business, and our inability to obtain such capital could harm our business.
+
+ 
+
+To
+support our expanding business, we must have sufficient capital to continue to make significant investments in our existing products
+and advertising. We cannot assure you that cash generated by our operations will be sufficient to allow us to fund such expansion. If
+cash flows from operations are not sufficient, we may need additional equity or debt financing to provide the funds required to expand
+our business. If such financing is not available on satisfactory terms or at all, we may be unable to expand our business or to develop
+new business at the rate desired and our operating results may suffer. Debt financing increases expenses, may contain covenants that
+restrict the operation of our business, and must be repaid regardless of operating results. Equity financing, or debt financing that
+is convertible into equity, could result in additional dilution to our existing stockholders. Our inability to obtain adequate capital
+resources, whether in the form of equity or debt, to fund our business and growth strategies may require us to delay, scale back or eliminate
+some or all our operations or the expansion of our business, which may have a material adverse effect on our business, operating results,
+financial condition, or prospects.
+
+ 
+
+Our
+growth could strain our personnel and infrastructure resources, and if we are unable to implement appropriate controls and procedures
+to manage our growth, we may not be able to successfully implement our business plan.
+
+ 
+
+Our
+success will depend in part upon management s ability to manage growth. To do so, we must continue to hire, train, and manage new
+employees as needed. If our new hires perform poorly, or if we are unsuccessful in hiring, training, managing, and integrating these
+new employees, or if we are not successful in retaining our existing employees, our business may be harmed. To manage the expected growth
+of our operations and personnel, we will need to continue to improve our operational, financial and management controls and our reporting
+systems and procedures. The additional headcount and capital investments we are adding will increase our cost base, which will make it
+more difficult for us to offset any future revenue shortfalls by offsetting expense reductions in the short term. If we fail to successfully
+manage our growth, we will be unable to execute our business plan.
+
+ 
+
+Risks
+Related to Our Industry
+
+ 
+
+We
+might not be able to receive the applicable governmental approval for the land use and the construction of marinas which might cause
+us unable to carry out our marina business.
+
+ 
+
+Since
+our current marina projects are all in China and China requires government approval for the land use and construction of marinas, if
+we are unable to receive all the required approvals and permits, we may not be able to start the marina development and may not be able
+to carry out our marina business operations.
+
+ 
+
+Weather
+conditions and natural disasters may have severe impact on our business operations and cause damage to our business.
+
+ 
+
+The
+entire yacht and marina industry is significantly affected by natural disasters and weather conditions. In the cold weather season, overall
+customer consumption will be reduced. Weather conditions of natural disasters can also affect our business performance. For example,
+drought can bring risks to shipping, hurricanes or other storms can also cause operational interruptions, or damage ships and dock facilities.
+
+ 
+
+Risks
+Related to Doing Business in the PRC
+
+ 
+
+A
+downturn in the PRC or global economy, and economic and political policies of the PRC could materially and adversely affect our business
+and financial condition.
+
+ 
+
+We
+conduct certain operations through our subsidiaries in the PRC and we also have wholly-owned subsidiaries with operations in the PRC.
+Accordingly, our business, prospects, financial condition and results of operations may be influenced to a significant degree by political,
+economic and social conditions in the PRC generally and by continued economic growth in the PRC as a whole. The Chinese economy differs
+from the economies of most developed countries in many respects, including the amount of government involvement, level of development,
+growth rate, control of foreign exchange and allocation of resources. While the Chinese economy has experienced significant growth over
+the past decades, growth has been uneven, both geographically and among various sectors of the economy. The Chinese government has implemented
+various measures to encourage economic growth and guide the allocation of resources. Some of these measures may benefit the overall Chinese
+economy, but may have a negative effect on us.
+
+ 28
+
+ 
+
+ 
+
+Economic
+conditions in China are sensitive to global economic conditions. Any prolonged slowdown in the global or Chinese economy may affect potential
+clients confidence in financial market as a whole and have a negative impact on our business, results of operations and financial
+condition. Additionally, continued turbulence in the international markets may adversely affect our ability to access the capital markets
+to meet liquidity needs.
+
+ 
+
+Lack
+of experienced professionals might cause us unable to find adequate workforce to fulfill our demand.
+
+ 
+
+Currently,
+even though there is a growing yacht industry in China, there are not enough professional personnel to manage these specialized services.
+Furthermore, there are no companies that focus on training these essential personnel. The personnel in the marina management, yacht service,
+event planning, repair and maintenance do not meet the high demand of the yacht services.
+
+ 
+
+Uncertainties
+with respect to the PRC legal system could adversely affect us and we may have limited legal recourse under PRC law if disputes arise
+under our contracts with third parties.
+
+ 
+
+China
+has not developed a fully integrated legal system and recently enacted laws and regulations may not sufficiently cover all aspects of
+economic activities in the PRC. Because these laws and regulations are relatively new, the interpretation and enforcement of these laws
+and regulations involve uncertainties. In addition, the PRC legal system is based in part on government policies and internal rules (some
+of which are not published on a timely basis or at all) that may have a retroactive effect. As a result, sometimes we may not be aware
+of our violation of these policies and rules until sometime after violation.
+
+ 
+
+The
+PRC government has enacted some laws and regulations dealing with matters such as corporate organization and governance, foreign investment,
+commerce, taxation, and trade. However, their experience in implementing, interpreting, and enforcing these laws and regulations is limited,
+and our ability to enforce commercial claims or to resolve commercial disputes is unpredictable. The resolution of these matters may
+be subject to the exercise of considerable discretion by agencies of the PRC government, and forces unrelated to the legal merits of
+a particular matter or dispute may influence their determination. Any rights we may have to specific performance, or to seek an injunction
+under PRC law, in either of these cases, are severely limited, and without a means of recourse by virtue of the PRC legal system, we
+may be unable to prevent these situations from occurring. The occurrence of any such events could have a material adverse effect on our
+business, financial condition, and results of operations.
+
+ 
+
+Changes
+in the policies, regulations, rules, and the enforcement of laws of the PRC government may be quick with little advance notice and could
+have a significant impact upon our ability to operate profitably in the PRC and may cause the value of our securities to significantly
+decline or be worthless. 
+
+ 
+
+We
+conduct operations through our subsidiaries in the PRC, which may subject us to certain laws and regulations in the PRC. Accordingly,
+economic, political and legal developments in the PRC will affect our business, financial condition, results of operations and prospects.
+Policies, regulations, rules, and the enforcement of laws of the PRC government can have significant effects on economic conditions in
+the PRC and the ability of businesses to operate profitably. Our ability to operate profitably in the PRC may be adversely affected by
+changes in policies by the PRC government, including changes in laws, regulations or their interpretation, particularly those dealing
+with the Internet, including censorship and other restriction on material which can be transmitted over the Internet, security, intellectual
+property, money laundering, taxation and other laws that affect our ability to operate our business in China.
+
+ 
+
+Additionally,
+most of our production and operations are currently conducted in the PRC, and we are subject to certain legal and operational risks associated
+with our PRC operating subsidiaries. We are aware of the recent regulatory actions and statements initiated by the PRC government to
+regulate business operations in certain areas in PRC with little advance notice, such as regulatory actions targeting certain sectors
+of the for-profit education sector and technology and gaming platforms that have a quantitatively significant number of users located
+in PRC. There was also introduction of new legislative and regulatory proposals in PRC concerning data protection, see Risk Factors
+– Our failure to comply with data protection laws and regulations could lead to government enforcement actions and significant
+penalties against us, and adversely impact our operating results . Although our current businesses are not affected under these
+regulatory actions, it is highly uncertain if the legislative or administrative regulation making bodies will change their focus to the
+sector which we operate in. It is also highly uncertain if, in the case we are subject to new laws and regulations, it will result in
+a material change in our operations and/or the value of our securities or if such modified or new laws and regulations could significantly
+limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our securities to
+significantly decline or be worthless.
+
+ 
+
+The
+Chinese government may intervene in or influence our business operations at any time or may exert more control over offerings conducted
+overseas and foreign investment in China based issuers, which could result in a material change in our business operations and significantly
+and adversely impact the value of our securities. Additionally, the governmental and regulatory interference could significantly limit
+or completely hinder our ability to offer or continue to offer securities to investors and cause the value of such securities to significantly
+decline or be worthless.
+
+ 29
+
+ 
+
+ 
+
+The
+Chinese government has significant oversight and discretion over the conduct of our business and may intervene or influence our operations
+as the government deems appropriate to further regulatory, political and societal goals. The Chinese government has recently published
+new policies that significantly affected certain industries such as the education and internet industries, and we cannot rule out the
+possibility that it will in the future release regulations or policies regarding our industry that could require us to seek permission
+from Chinese authorities to continue to operate our business, which may adversely affect our business, financial condition and results
+of operations. Furthermore, recent statements made by the Chinese government have indicated an intent to increase the government s
+oversight and control over offerings of companies with significant operations in China that are to be conducted in foreign markets, as
+well as foreign investment in China-based issuers like us. Any such action, once taken by the Chinese government, could significantly
+limit or completely hinder our ability to offer or continue to offer ordinary shares to our investors, and could cause the value of our
+ordinary shares to significantly decline or become worthless.
+
+ 
+
+Recent
+statements by the Chinese government have indicated an intent to exert more oversight and control over offerings that are conducted overseas
+and/or foreign investments in China-based issuers. On July 6, 2021, the General Office of the Central Committee of the Communist Party
+of China and the General Office of the State Council jointly promulgated the Opinions on Strictly Cracking Down on Illegal Securities
+Activities in Accordance with the Law, pursuant to which Chinese regulators are required to accelerate rulemaking related to the overseas
+issuance and listing of securities, and update the existing laws and regulations related to data security, cross-border data flow, and
+management of confidential information. On December 24, 2021, the State Council published the Provisions on the Administration of Overseas
+Securities Offering and Listing by Domestic Companies, or Draft Administration Provisions, as well as the Administrative Measures for
+the Filing of Overseas Securities Offering and Listing by Domestic Companies, or Draft Administration Measures, for public comments.
+Under the Draft Administration Provisions, a filing-based regulatory system will be introduced to cover both direct and indirect overseas
+issuance and listing of securities. The Draft Administration Measures further provide the scope of activities subject to the filing requirement,
+and relevant criteria for determining whether an activity falls within the scope. Pursuant to the Draft Administration Measures, the
+determination as to whether a PRC domestic company is indirectly offering and listing securities in an overseas market shall be made
+on a substance over form basis. If the issuer meets the following conditions, the offering and listing shall be determined as an indirect
+overseas offering and listing by a domestic company: (1) the total assets, net assets, revenues or profits of the domestic operating
+entity of the issuer in the most recent accounting year account for more than 50% of the corresponding figure in the issuer s audited
+consolidated financial statements for the same period; and (2) the senior management in charge of business operation and management of
+the issuer are mostly Chinese citizens or have domicile in China, and the issuer s main places of business are located in China
+or main business activities are conducted in China. The PRC has recently published new rules that require companies collecting or holding
+large amounts of data to undergo a cybersecurity review prior to listing in foreign countries. Pursuant to Article 7 of the Measures
+for Cybersecurity Review published by the CAC on December 28, 2021 and became effective on February 15, 2022, if an issuer is classified
+as a network platform operator and such issuer possesses personal information of more than 1 million users must now apply
+for cybersecurity approval when seeking listings in other nations due to the risk that such data and personal information could be affected,
+controlled, and maliciously exploited by foreign governments. 
+
+ 
+
+As
+a holding company with no material operations of our own, our operations are conducted through our subsidiaries in the PRC, which may
+subject us to certain laws and regulations in China. As such, we may collect certain personal data from our customers in connection with
+our business and operations and we are subject to various regulatory requirements relating to the security and privacy of data in various
+jurisdictions. However, we do not hold personal information of more than one million users and we believe that this offering is not subject
+to PRC cybersecurity review. In addition, as of the date of this prospectus, we have not received any notice of and is not currently
+subject to any proceedings initiated by the CAC or any other PRC regulatory authority. Nonetheless, we may be subject to heightened regulatory
+scrutiny from PRC governmental authorities in the future. As there remains significant uncertainty in the interpretation and enforcement
+of the Data Security Law and the Personal Information Protection Law, we cannot assure you that we will comply with such regulations
+in all respects. Any non-compliance with these laws and regulations may subject us to fines, orders to rectify or terminate any actions
+that are deemed illegal by regulatory authorities, other penalties, including but not limited to reputational damage or legal proceedings
+against us, which may affect our business, financial condition or results of operations.
+
+ 
+
+Notwithstanding
+the foregoing, as of the date of this prospectus, there are no PRC laws and regulations in force explicitly requiring that we obtain
+any pre-approval from PRC authorities to issue securities to foreign investors, and we have not received any inquiry, notice, warning,
+sanction or any regulatory objection to this offering from the CSRC, the CAC or any other PRC authorities that have jurisdiction over
+our operations. Based on our understanding of the PRC laws and regulations currently in effect as of the date of this prospectus, our
+registered public offering in the U.S. is not subject to the review or prior approval of the CAC or the CSRC. However, there remains
+uncertainty as to the enactment, interpretation and implementation of regulatory requirements related to overseas securities offering
+and other capital markets activities and due to the possibility, that laws, regulations, or policies in the PRC could change rapidly in
+the future. Any future action by the PRC government expanding the
+
+ 30
+
+ 
+
+ 
+
+categories of industries and companies whose foreign securities offerings
+are subject to review by the CSRC, the CAC or other PRC regulatory authorities could significantly limit or completely hinder our ability
+to offer or continue to offer securities to investors and could cause the value of such securities to significantly decline or be worthless.
+
+ 
+
+The
+approval of the CSRC and the CAC and other Chinese regulatory agencies may be required in connection with this offering under Chinese
+law.
+
+ 
+
+The
+Regulations on Mergers and Acquisitions of Domestic Enterprises by Foreign Investors (the M&A Rules ) purport to require
+offshore special purpose vehicles that are controlled by Chinese companies or individuals and that have been formed for the purpose of
+seeking a public listing on an overseas stock exchange through acquisitions of Chinese domestic companies or assets in exchange for the
+shares of the offshore special purpose vehicles shall obtain CSRC approval prior to publicly listing their securities on an overseas
+stock exchange.
+
+ 
+
+Furthermore,
+on July 6, 2021, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council
+jointly promulgated the Opinions on Strictly Cracking Down on Illegal Securities Activities in Accordance with the Law, pursuant to which
+Chinese regulators are required to accelerate rulemaking related to the overseas issuance and listing of securities, and update the existing
+laws and regulations related to data security, cross-border data flow, and management of confidential information. On December 24, 2021,
+the State Council published the Provisions on the Administration of Overseas Securities Offering and Listing by Domestic Companies, or
+Draft Administration Provisions, as well as the Administrative Measures for the Filing of Overseas Securities Offering and Listing by
+Domestic Companies, or Draft Administration Measures, for public comments. Under the Draft Administration Provisions, a filing-based
+regulatory system will be introduced to cover both direct and indirect overseas issuance and listing of securities. The Draft Administration
+Measures further provide the scope of activities subject to the filing requirement, and relevant criteria for determining whether an
+activity falls within the scope. Pursuant to the Draft Administration Measures, the determination as to whether a PRC domestic company
+is indirectly offering and listing securities in an overseas market shall be made on a substance over form basis. if the issuer meets
+the following conditions, the offering and listing shall be determined as an indirect overseas offering and listing by a domestic company:
+(1) the total assets, net assets, revenues or profits of the domestic operating entity of the issuer in the most recent accounting year
+account for more than 50% of the corresponding figure in the issuer s audited consolidated financial statements for the same period;
+and (2) the senior management in charge of business operation and management of the issuer are mostly Chinese citizens or have domicile
+in China, and the issuer s main places of business are located in China or main business activities are conducted in China. Numerous
+regulations, guidelines and other measures have been or are expected to be adopted under the umbrella of or in addition to the Cybersecurity
+Law and Data Security Law. As there are still uncertainties regarding the interpretation and implementation of such regulatory guidance,
+we cannot assure you that we will be able to comply with new regulatory requirements relating to our future overseas capital-raising
+activities and we may become subject to more stringent requirements with respect to matters including data privacy and cross-border investigation
+and enforcement of legal claims. Notwithstanding the foregoing, as of the date of this prospectus, we are not aware of any Chinese laws
+or regulations in effect requiring that we obtain permission from any Chinese authority to issue securities to foreign investors, and
+we have not received any inquiry, notice, warning, sanction or any regulatory objection to this offering from the CSRC, the CAC or any
+other Chinese authorities that have jurisdiction over our operations.
+
+ 
+
+Our
+business is subject to various government regulations and regulatory interference. As of the date of this prospectus, each of our PRC
+subsidiaries has received all requisite permissions and approvals from the Chinese authorities for the operation of our business in the
+PRC. Based on the PRC laws and regulations currently effective and advised by our PRC counsel, Liuhe (Wenzhou) Law Firm, we, including
+our subsidiaries, are not subject to any pre-approval requirement, filing or reporting from Chinese authorities, including the China
+Securities Regulatory Commission, or CSRC, or Cybersecurity Administration Committee, or CAC, to conduct this offering or list on U.S.
+exchanges or issue securities to foreign investors or to obtain any further permissions to conduct our current business in the PRC in
+addition to the permits currently held by us to operate our general business activities. Nevertheless, we may incur increased costs necessary
+to comply with existing and newly adopted laws and regulations or penalties for any failure to comply. Furthermore, given recent statements
+by the Chinese government indicating an intent to exert more oversight and control over offerings that are conducted overseas and there
+are uncertainties with respect to the Chinese legal system and changes in laws, regulations and policies, including how those laws and
+regulations will be interpreted or implemented, although as of the date of this prospectus, we have not been involved in any investigations
+initiated by the applicable government regulatory authorities, nor have we received any inquiry, notice, warning or sanction in such
+respect, it is uncertain whether or when we might be subject to such requirements, permission and approval from any related PRC government
+to list our shares on U.S. exchanges in the future. If approval is required in the future and we were denied permission from Chinese
+authorities to list on U.S. exchanges, we will not be able to continue listing on U.S. exchange or it may adversely affect our business
+and results of operation, which would materially affect the interest of the investors. It is uncertain when and whether the Company will
+be required to obtain permission from the PRC government to continue to list on U.S. exchanges or to conduct our current business
+in the future, and even when such permission is obtained, whether it will be denied or rescinded.
+
+ 31
+
+ 
+
+ 
+
+Although we are currently not required
+to obtain any pre-approval requirement from any of the PRC central or local government and we have not received any denial to conduct
+this offering, to list on the U.S. exchange or to conduct our current business, our operations may be adversely affected in the future,
+directly or indirectly, by existing or future PRC laws and regulations if PRC regulatory authorities do not take the same view as us.
+If the CSRC or other regulatory agencies later promulgate new rules or explanations requiring that we obtain their approvals for this
+offering and any follow-on offering, we may be unable to obtain such approvals which could significantly limit or completely hinder our
+ability to offer or continue to offer securities to our investors. The CSRC or other PRC regulatory agencies may also take actions requiring
+us, or making it advisable for us, to halt this offering before the settlement and delivery of the ordinary shares that we are offering.
+Consequently, if you engage in market trading or other activities in anticipation of and prior to the settlement and delivery of the
+ordinary shares we are offering, you would be doing so at the risk that the settlement and delivery may not occur. Any uncertainties
+or negative publicity regarding such approval requirements could have a material adverse effect on our ability to complete this offering
+or any follow-on offering of our securities or the market for and market price of our ordinary shares. However, currently, we are not
+required to obtain additional permission or approval from Chinese authorities, including the CSRC and the CAC, to either approve our
+PRC subsidiaries operation or to offer the securities being registered to foreign investors. 
+
+ 
+
+Based
+on the above and advised by our PRC counsel, Liuhe (Wenzhou) Law Firm as of the date of this prospectus, we are not required
+to submit an application to the CSRC or the CAC for the approval of this offering and the listing and trading of our common shares on
+the U.S. exchanges. However, there remains significant uncertainty as to the enactment, interpretation and implementation of regulatory
+requirements related to overseas securities offerings and other capital markets activities. If it is determined in the future that the
+approval or filing of the CSRC, CAC or any other regulatory authority is required for this offering, we may face sanctions by the CSRC,
+the CAC or other Chinese regulatory agencies. These regulatory agencies may impose fines and penalties on our operations in China, limit
+our ability to pay dividends outside of China, limit our operations in China, delay or restrict the repatriation of the proceeds from
+this offering into China or take other actions that could have a material adverse effect on our business, financial condition, results
+of operations and prospects, as well as the trading price of our ordinary shares. The CSRC, the CAC or other Chinese regulatory agencies
+may take actions requiring us, or making it advisable for us, to halt this offering before settlement and delivery of the common shares.
+Consequently, if you engage in market trading or other activities in anticipation of and prior to settlement and delivery, you do so
+at the risk that settlement and delivery may not occur. In addition, if the CSRC, the CAC or other regulatory agencies later promulgate
+new rules requiring that we obtain their approvals for this offering, we may be unable to obtain a waiver of such approval requirements,
+if and when procedures are established to obtain such a waiver. Any uncertainties and/or negative publicity regarding such an approval
+requirement could have a material adverse effect on the trading price of the common shares.
+
+ 
+
+We
+rely on dividends and other distributions on equity paid by our subsidiaries to fund any cash and financing requirements we may have,
+and any limitation on the ability of our subsidiaries to make payments to us could have a material adverse effect on our ability to conduct
+the business.
+
+ 
+
+We
+are a holding company, and we rely on dividends and other distributions on equity paid by our subsidiaries for our cash and financing
+requirements, including the funds necessary to pay dividends and other cash distributions to our shareholders and service any debt we
+may incur. If Vivic Guangdong and its subsidiaries incur debt on their own behalf in the future, the instruments governing the debt may
+restrict their ability to pay dividends or make other distributions to us. In addition, the China tax authorities may require our subsidiaries
+to adjust its taxable income, in a manner that would materially and adversely affect their ability to pay dividends and other distributions
+to us.
+
+ 
+
+Under
+PRC laws and regulations, Vivic Guangdong and its subsidiaries may pay dividends only out of their respective accumulated after-tax profits
+as determined in accordance with PRC accounting standards and regulations. In addition, any company is required to set aside at least
+10% of its accumulated after-tax profits each year, if any, to fund certain statutory reserve funds, until the aggregate amount of such
+funds reaches 50% of its registered capital. At its discretion, a company may allocate a portion of its after-tax profits based on PRC
+accounting standards to staff welfare and bonus funds. These reserve funds and staff welfare and bonus funds are not distributable as
+cash dividends.
+
+ 
+
+In
+response to the persistent capital outflow and the Renminbi s depreciation against the U.S. dollar in the fourth quarter of 2016,
+the People s Bank of China and SAFE have implemented a series of capital control measures, including stricter vetting procedures
+for China-based companies to remit foreign currency for overseas acquisitions, dividend payments and shareholder loan repayments. The
+PRC government may continue to strengthen its capital controls and our subsidiaries dividends and other distributions may be subjected
+to tighter scrutiny in the future.
+
+ 
+
+Any
+limitation on the ability of our subsidiaries to pay dividends or make other distributions to us could materially and adversely limit
+our ability to grow, make investments or acquisitions that could be beneficial to our business, pay dividends, or otherwise fund and
+conduct the business of the PRC operating entities.
+
+ 32
+
+ 
+
+ 
+
+The
+PRC government also imposes controls on the conversion of RMB into foreign currencies and the remittance of currencies out of the PRC.
+Therefore, we may experience difficulties in completing the administrative procedures necessary to obtain and remit foreign currency
+for the payment of dividends from our profits, if any. Furthermore, if our subsidiaries in the PRC incur debt on their own in the future,
+the instruments governing the debt may restrict their ability to pay dividends or make other payments. If we or our subsidiaries are
+unable to receive all of the revenues from our operations, we may be unable to pay dividends on our common shares. See Prospectus
+Summary - Dividend Distributions or Transfers of Cash among the Holding Company, its Subsidiaries,
+and the PRC Operating Entities and Risk Factors - Risks Relating to
+Doing Business in China.
+
+ 
+
+Any
+limitation on the ability of our subsidiaries to pay dividends or make other distributions to us could materially and adversely limit
+our ability to grow, make investments or acquisitions that could be beneficial to our business, pay dividends, or otherwise fund and
+conduct the business of the PRC operating entities.
+
+ 
+
+Increases
+in labor costs in the PRC may adversely affect our business and results of operations.
+
+ 
+
+The
+economy in China has experienced increases in inflation rates and labor costs in recent years. As a result, average wages in the PRC
+are expected to continue to increase. In addition, we are required by PRC laws and regulations to pay various statutory employee benefits,
+including pension, housing fund, medical insurance, work-related injury insurance, unemployment insurance and maternity insurance to
+designated government agencies for the benefit of our employees. The relevant government agencies may examine whether an employer has
+made adequate payments to the statutory employee benefits, and those employers who fail to make adequate payments may be subject to late
+payment fees, fines and/or other penalties. We expect that our labor costs, including wages and employee benefits, will continue to increase.
+Unless we are able to control our labor costs or pass on these increased labor costs to our users by increasing the fees of our services,
+our financial condition and results of operations may be adversely affected.
+
+ 
+
+Changes
+in PRC s economic, political or social conditions or government policies could have a material adverse effect on our business and
+operations.
+
+ 
+
+Currently,
+most of our production is conducted in PRC. Accordingly, our business, financial condition, results of operations and prospects may be
+influenced to a significant degree by political, economic and social conditions in PRC generally and by continued economic growth in
+PRC as a whole.
+
+ 
+
+PRC s
+economy differs from the economies of most developed countries in many respects, including the level of government involvement, level
+of development, growth rate, control of foreign exchange and allocation of resources. Although the PRC government has implemented measures
+since the late 1970 s emphasizing the utilization of market forces for economic reform, the reduction of state ownership of productive
+assets, and the establishment of improved corporate governance in business enterprises, which are generally viewed as a positive development
+for foreign business investment, a substantial portion of productive assets in PRC is still owned by the PRC government. In addition,
+the PRC government continues to play a significant role in regulating industry development by imposing industrial policies. The PRC government
+also exercises significant control over the PRC economic growth through allocating resources, controlling payments of foreign currency-denominated
+obligations, setting monetary policy, and providing preferential treatment to particular industries or companies.
+
+ 
+
+While
+PRC s economy has experienced significant growth over the past decades, growth has been uneven, both geographically and among
+various sectors of the economy, and the rate of growth has been slowing down. Some of the governmental measures may benefit the
+overall Chinese economy, but may have a negative effect on us. For example, our financial condition and results of operations may be
+adversely affected by government control over capital investments or changes in tax regulations. Any stimulus measures designed to
+boost the Chinese economy may contribute to higher inflation, which could adversely affect our results of operations and financial
+condition. For example, certain operating costs and expenses, such as employee compensation and office operating expenses, may
+increase as a result of higher inflation. In addition, the PRC government has implemented in the past certain measures to control
+the pace of economic growth. These measures may cause decreased economic activity, which in turn could lead to a reduction in demand
+for our products and services, and consequently have a material adverse effect on our businesses, financial condition and results of
+operations. According to National Bureau of Statistics, the CPI( consumer price index) and PPI ( producer price index) was 1.7% and
+7.7%, respectively, for the first half of 2022. Both indexes have shown stable trends. The agency gave a guideline that due to
+global interest hike cycle; the import commodity prices will likely further fall in the following twelve months. Currently, we are
+able to pass along our increased various costs to our yacht buyers or Joy wave consumers, we have not experienced much impact or
+disruption in our operations from inflation. However, we cannot assure you that we may not experience much impact from inflation if
+the PRC government implement another stimulus measures or decrease benchmark lending interest rates.
+
+ 33
+
+ 
+
+ 
+
+Supply
+chain interruptions may increase our costs or reduce our revenues in China.
+
+ 
+
+Our
+PRC operating entities depend on the effectiveness of the supply chain management systems to ensure reliable and sufficient supply, on
+reasonably favorable terms, of materially used in the construction and development of yacht marinas and all-electric boats and operating
+activities, such as engines,alloyed aluminum, steel,paints, wood, glass,
+just to name a few. The materials that the PRC operating entities purchase and use in the ordinary course of business are sourced from
+a wide variety of suppliers in the PRC and overseas. Disruptions in the supply chain may result from weather-related events, natural
+disasters, acts of war, terrorist attacks, pandemics, third-party strikes or ineffective cross- border operations, work stoppages or
+slowdowns, shipping capacity constraints, supply or shipping interruptions or other factors beyond our control. In the event of disruptions
+in the existing supply chain of the PRC operating entities, the labor and materials they rely on in the ordinary course of our business
+may not be available at reasonable rates or at all. In some cases, the PRC operating entities may rely on a limited sources for procurement
+or other supplies in a given region. Any disruption in the supply of certain materials could disrupt operations at our existing locations
+or significantly delay the operations of our marinas or all-electric boat development, which may cause harm to the reputation of the
+PRC operating entities and our results of operations.
+
+ 
+
+PRC
+regulation of loans to and direct investment in PRC entities by offshore holding companies and governmental control of currency conversion
+may delay us from using the proceeds of this offering to make loans or additional capital contributions to our subsidiaries, which could
+materially and adversely affect our liquidity and our ability to fund and expand the business of the PRC operating entities.
+
+ 
+
+We
+are an offshore holding company conducting our operations in China through the PRC operating entities. We may make loans to our subsidiaries
+subject to the approval from governmental authorities and limitation of amount, or we may make additional capital contributions to our
+subsidiaries in China.
+
+ 
+
+Any
+loans to Vivic Guangdong, which is treated as a foreign-invested enterprise under PRC laws, are subject to PRC regulations and foreign
+exchange loan registrations. For example, loans by us to Vivic Guangdong in China to finance its activities cannot exceed statutory limits
+and must be registered with the local counterpart of SAFE. In addition, a foreign invested enterprise shall use its capital pursuant
+to the principle of authenticity and self-use within its business scope. The capital of a foreign invested enterprise shall not be used
+for the following purposes: (i) directly or indirectly used for payment beyond the business scope of the enterprise or the payment prohibited
+by relevant laws and regulations; (ii) directly or indirectly used for investment in securities investments other than banks principal-secured
+products unless otherwise provided by relevant laws and regulations; (iii) the granting of loans to non-affiliated enterprises, except
+where it is expressly permitted in the business license; and (iv) paying the expenses related to the purchase of real estate that is
+not for self-use (except for the foreign-invested real estate enterprises).
+
+ 
+
+SAFE
+promulgated the Notice of the State Administration of Foreign Exchange on Reforming the Administration of Foreign Exchange Settlement
+of Capital of Foreign-invested Enterprises, or SAFE Circular 19, effective June 2015, in replacement of the Circular on the Relevant
+Operating Issues Concerning the Improvement of the Administration of the Payment and Settlement of Foreign Currency Capital of Foreign-Invested
+Enterprises, the Notice from the State Administration of Foreign Exchange on Relevant Issues Concerning Strengthening the Administration
+of Foreign Exchange Businesses, and the Circular on Further Clarification and Regulation of the Issues Concerning the Administration
+of Certain Capital Account Foreign Exchange Businesses. Although SAFE Circular 19 allows RMB capital converted from foreign currency-denominated
+registered capital of a foreign-invested enterprise to be used for equity investments within China, it also reiterates the principle
+that RMB converted from the foreign currency-denominated capital of a foreign-invested company may not be directly or indirectly used
+for purposes beyond its business scope. Thus, it is unclear whether SAFE will permit such capital to be used for equity investments in
+China in actual practice. SAFE promulgated the Notice of the State Administration of Foreign Exchange on Reforming and Standardizing
+the Foreign Exchange Settlement Management Policy of Capital Account, or SAFE Circular 16, effective on June 9, 2016, which reiterates
+some of the rules set forth in SAFE Circular 19, but changes the prohibition against using RMB capital converted from foreign currency-denominated
+registered capital of a foreign-invested company to issue RMB entrusted loans to a prohibition against using such capital to issue loans
+to non-associated enterprises. Violations of SAFE Circular 19 and SAFE Circular 16 could result in administrative penalties. SAFE Circular
+19 and SAFE Circular 16 may significantly limit our ability to transfer any foreign currency we hold, including the net proceeds from
+this offering, to Hongli WFOE, which may adversely affect our liquidity and our ability to fund and expand the business of the PRC operating
+entities in China.
+
+ 
+
+On
+October 23, 2019, SAFE issued the Circular on Further Promoting Cross-border Trade and Investment Facilitation, or SAFE Circular 28,
+which took effect on the same day. SAFE Circular 28, subject to certain conditions, allows foreign-invested enterprises whose business
+scope does not include investment, or non-investment foreign-invested enterprises, to
+
+ 34
+
+ 
+
+ 
+
+use their capital funds to make equity investments
+in China. Since SAFE Circular 28 was issued only recently, its interpretation and implementation in practice are still subject to substantial
+uncertainties.
+
+ 
+
+In
+light of the various requirements imposed by PRC regulations on loans to and direct investment in PRC entities by offshore holding companies,
+and the fact that the PRC government may at its discretion restrict access to foreign currencies for current account transactions in
+the future, we cannot assure you that we will be able to complete the necessary government registrations or obtain the necessary government
+approvals on a timely basis, if at all, with respect to future loans to PRC subsidiaries in or future capital contributions by us to
+Vivic Guangdong in China. As a result, uncertainties exist as to our ability to provide prompt financial support to our subsidiaries
+when needed. If we fail to complete such registrations or obtain such approvals, our ability to use the proceeds we expect to receive
+from this offering and to capitalize or otherwise fund our PRC operations may be negatively affected, which could materially and adversely
+affect our liquidity and our ability to fund and expand the business of the PRC operating entities.
+
+ 
+
+Governmental
+control of currency conversion may limit our ability to utilize our net revenues effectively and affect the value of your investment.
+
+ 
+
+The
+PRC government imposes controls on the convertibility of the RMB into foreign currencies and, in certain cases, the remittance of currency
+out of China. We receive substantially almost of our net revenues in RMB. Under our current corporate structure, we rely on dividend
+payments from Vivic Guangdong to fund any cash and financing requirements we may have, including the funds necessary to pay dividends
+and other cash distributions to our shareholders or to pay any debt we may incur.
+
+ 
+
+Under
+existing PRC foreign exchange regulations, payments of current account items, such as profit distributions and trade and service-related
+foreign exchange transactions, can be made in foreign currencies without prior approval from SAFE by complying with certain procedural
+requirements. Therefore, our subsidiaries are able to pay dividends in foreign currencies to us without prior approval from SAFE, subject
+to the condition that the remittance of such dividends outside of the PRC complies with certain procedures under PRC foreign exchange
+regulation, such as the overseas investment registrations by the beneficial owners of our company who are PRC residents. Also, approval
+from or registration with appropriate government authorities is required where RMB is to be converted into foreign currency and remitted
+out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies.
+
+ 
+
+In
+light of the flood of capital outflows of China in 2016 due to the weakening RMB, the PRC government has imposed more restrictive foreign
+exchange policies and stepped-up scrutiny of major outbound capital movement. More restrictions and substantial vetting process are put
+in place by SAFE to regulate cross-border transactions falling under the capital account. The PRC government may also at its discretion
+restrict access in the future to foreign currencies for current account transactions. If the foreign exchange control system prevents
+us from obtaining sufficient foreign currencies to satisfy our foreign currency demands, we may not be able to pay dividends in foreign
+currencies to our shareholders.
+
+ 
+
+We
+must remit the offering proceeds to China before they may be used to benefit the business of the PRC operating entities in China, the
+process of which may be time-consuming, and we cannot assure that we can finish all necessary governmental registration processes in
+a timely manner.
+
+ 
+
+The
+proceeds of this offering must be sent back to China, and the process for sending such proceeds back to China may take several months
+after the closing of this offering. We may be unable to use these proceeds to grow the business of the PRC operating entities until they
+receive such proceeds in mainland China. In order to remit the offering proceeds to China, we will take the following actions:First,
+we will open a special foreign exchange account for capital account transactions. To open this account, we must submit to SAFE certain
+application forms, identity documents, transaction documents, form of foreign exchange registration of overseas investments by domestic
+residents, and foreign exchange registration certificate of the invested company. Second, we will remit the offering proceeds into this
+special foreign exchange account. Third, we will apply for settlement of the foreign exchange. In order to do so, we must submit to SAFE
+certain application forms, identity documents, payment order to a designated person, and a tax certificate. The timing of the process
+is difficult to estimate because the efficiencies of different SAFE branches can vary materially. Ordinarily, the process takes several
+months to complete but is required by law to be accomplished within 180 days of application. Until the above-mentioned approvals, the
+proceeds of this offering will be maintained in an interest-bearing account maintained by us in the United States.
+
+ 
+
+Certain
+PRC regulations may make it more difficult for us to pursue growth through acquisitions.
+
+ 
+
+Among
+other things, the M&A Rules, adopted by six PRC regulatory agencies in 2006 and amended in 2009, established additional procedures
+and requirements that could make merger and acquisition activities by foreign investors more time-consuming and complex. Such regulation
+requires, among other things, that the Ministry of Commerce of the PRC, or the
+
+ 35
+
+ 
+
+ 
+
+MOFCOM, be notified in advance of any change-of-control
+transaction in which a foreign investor acquires control of a PRC domestic enterprise or a foreign company with substantial PRC operations,
+if certain thresholds under the Provisions on Thresholds for Prior Notification of Concentrations of Undertakings, issued by the State
+Council in 2008, are triggered. Moreover, the Anti-Monopoly Law promulgated by the Standing Committee of the National People s
+Congress which became effective in 2008 requires that transactions which are deemed concentrations and involve parties with specified
+turnover thresholds must be cleared by the Anti-Monopoly Bureau of State Administration for Market Regulation, or the Anti-Monopoly Bureau
+before they can be completed. In addition, PRC national security review rules which became effective in September 2011 require acquisitions
+by foreign investors of PRC companies engaged in military related or certain other industries that are crucial to national security be
+subject to security review before consummation of any such acquisition. We may pursue potential strategic acquisitions that are complementary
+to our business and operations. Complying with the requirements of these regulations to complete such transactions could be time-consuming,
+and any required approval processes, including obtaining approval or clearance from the MOFCOM or the Anti-Monopoly Bureau or its local
+counterparts, may delay or inhibit our ability to complete such transactions, which could affect our ability to expand our business or
+maintain our market share.
+
+ 
+
+Enhanced
+scrutiny over acquisition transactions by the PRC tax authorities may have a negative impact on potential acquisitions we may pursue
+in the future.
+
+ 
+
+Pursuant
+to the Notice on Strengthening Administration of Enterprise Income Tax for Share Transfers by Non-PRC Resident Enterprises, or SAT Circular
+698, issued by China s State Administration of Taxation ( SAT ) on December 10, 2009, where a foreign investor transfers
+the equity interests of a resident enterprise indirectly via disposition of the equity interests of an overseas holding company, or an
+ indirect transfer, and such overseas holding company is located in a tax jurisdiction that (i) has an effective tax rate
+less than 12.5% or (ii) does not tax foreign income of its residents, the foreign investor shall report the indirect transfer to the
+competent PRC tax authority. The PRC tax authority will examine the true nature of the indirect transfer, and if the tax authority considers
+that the foreign investor has adopted an abusive arrangement in order to avoid PRC tax, it may disregard the existence
+of the overseas holding company and re-characterize the indirect transfer and as a result, gains derived from such indirect transfer
+may be subject to PRC withholding tax at a rate of up to 10%.
+
+ 
+
+On
+February 3, 2015, the SAT issued the Announcement of the State Administration of Taxation on Several Issues Concerning the Enterprise
+Income Tax on Indirect Property Transfer by Non-Resident Enterprises, or SAT Bulletin 7, to supersede existing provisions in relation
+to the indirect transfer as set forth in SAT Circular 698, while the other provisions of SAT Circular 698 remain in force.
+Pursuant to SAT Bulletin 7, where a non-resident enterprise indirectly transfers properties such as equity in PRC resident enterprises
+without any justifiable business purposes and aiming to avoid the payment of enterprise income tax, such indirect transfer must be reclassified
+as a direct transfer of equity in PRC resident enterprise. To assess whether an indirect transfer of PRC taxable properties has reasonable
+commercial purposes, all arrangements related to the indirect transfer must be considered comprehensively and factors set forth in SAT
+Bulletin 7 must be comprehensively analyzed in light of the actual circumstances. SAT Bulletin 7 also provides that, where a non-PRC
+resident enterprise transfers its equity interests in a resident enterprise to its related parties at a price lower than the fair market
+value, the competent tax authority has the power to make a reasonable adjustment to the taxable income of the transaction.
+
+ 
+
+On
+October 17, 2017, the SAT issued the Announcement of the State Administration of Taxation on Matters Concerning Withholding of Income
+Tax of Non-resident Enterprises as Source, or SAT Bulletin 37, which repealed the entire SAT Circular 698 and the provision in relation
+to the time limit for the withholding agent to declare to the competent tax authority for payment of such tax of SAT Bulletin 7. Pursuant
+to SAT Bulletin 37, the income from a property transfer, as stipulated in the second item under Article 19 of the Enterprise Income Tax
+Law, shall include the income derived from transferring such equity investment assets as stock equity. The balance of deducting the equity s
+net value from the total income from equity transfer shall be taxable income from equity transfer. Where a withholding agent enters into
+a business contract, involving the income specified in the third paragraph of Article 3 in the Enterprise Income Tax Law, with a non-resident
+enterprise, the tax-excluding income of the non-resident enterprise will be treated as the tax-including income, based on which the tax
+payment will be calculated and remitted, if it is agreed in the contract that the withholding agent shall assume the tax payable.
+
+ 
+
+During
+the effective period of SAT Circular 698 and by the application of SAT Bulletin 7 and SAT Bulletin 37, some intermediary holding companies
+were actually looked through by the PRC tax authorities, and consequently the non-PRC resident investors were deemed to have transferred
+the PRC subsidiary and PRC corporate taxes were assessed accordingly. It is possible that we or our non-PRC resident investors may become
+at risk of being taxed under SAT Bulletin 7 and SAT Bulletin 37 and may be required to expend valuable resources to comply with SAT Bulletin
+7 and SAT Bulletin 37 or to establish that we or our non-PRC resident investors should not be taxed under SAT Bulletin 7 and SAT Bulletin
+37, which may have an adverse effect on our financial condition and results of operations or such non-PRC resident investors investment
+in us.
+
+ 36
+
+ 
+
+ 
+
+Your
+ability to bring an action against us or against our directors and officer, or to enforce a judgment against us or them, will be limited
+because we conduct all our operations in the PRC and because all our directors and the majority of our officers reside outside of the
+United States.
+
+ 
+
+We
+are a company in Nevada but all our assets are located outside of the United States. All our current operations are conducted in the
+PRC and Taiwan. In addition, all our directors and officers are nationals and residents of countries other than the United States. A
+substantial portion of the assets of these persons are located outside the United States. As a result, it may be difficult for you to
+effect service of process within the United States upon these persons. It may also be difficult for you to enforce in U.S. courts 
+judgments on the civil liability provisions of the U.S. federal securities laws against us and our officers and directors, none of whom
+are residents in the United States and the substantial majority of whose assets are located outside of the United States. In addition,
+there is uncertainty as to whether the courts of the PRC would recognize or enforce judgments of U.S. courts. Our counsel as to PRC law
+has advised us that the recognition and enforcement of foreign judgments are provided for under the PRC Civil Procedures Law.
+Courts in the PRC may recognize and enforce foreign judgments in accordance with the requirements of the PRC Civil Procedures
+Law based on treaties between the PRC and the country where the judgment is made or on reciprocity between jurisdictions. The
+PRC does not have any treaties or other arrangements that provide for the reciprocal recognition and enforcement of foreign judgments
+with the United States. In addition, according to the PRC Civil Procedures Law, courts in the PRC will not enforce a foreign judgment
+against us or our directors and officers if they decide that the judgment violates basic principles of PRC law or national sovereignty,
+security, or the public interest. Therefore, it is uncertain whether a PRC court would enforce a judgment rendered by a court in the
+United States.
+
+ 
+
+It
+may be difficult for overseas regulators to conduct investigation or collect evidence within China.
+
+ 
+
+Shareholder
+claims or regulatory investigation that are common in the United States generally are difficult to pursue as a matter of law or practicality
+in China. For example, in China, there are significant legal and other obstacles to providing information needed for regulatory investigations
+or litigations initiated outside China. Although the authorities in China may establish a regulatory cooperation mechanism with the security s
+regulatory authorities of another country or region to implement cross-border supervision and administration, such cooperation with the
+security s regulatory authorities in the Unities States may not be efficient in the absence of mutual and practical cooperation mechanism.
+Furthermore, according to Article 177 of the PRC Securities Law, which became effective in March 2020, no overseas securities regulator
+is allowed to directly conduct investigation or evidence collection activities within the PRC territory. While detailed interpretation
+of or implementation rules under Article 177 have yet to be promulgated, the inability for an overseas securities regulator to directly
+conduct investigation or evidence collection activities within China may further increase the difficulties you face in protecting your
+interests.
+
+ 
+
+Risks
+Related to Doing Business in Taiwan
+
+ 
+
+1 Political
+Issue
+
+ 
+
+Taiwan
+is surrounded by sea and the coastline is curved long. The population density is high around the west coast and Taiwan Strait. The Taiwan
+vessels are allowed to cruise offshore only on the west coast due to the political issue between Taiwan and PRC. It harmfully influences
+the accessibility of Taiwan vessels along the west coast and sea tourism eventually.
+
+ 
+
+2 Consumer
+Prospect
+
+ 
+
+Most
+consumers do not well understand the luxury yachts market and are price-conscious in the past. As a result, the sightseeing boats with
+high-carrying capacity are targeted. The operating costs between luxury yachts and sightseeing boats are hugely different. More educational
+and promotional activities should be launched to arouse potential consumers how the luxury yachts valued for money.
+
+ 
+
+3 Climate
+Issue
+
+ 
+
+Taiwan
+is located in the subtropical and tropical areas with typhoons in Summer and strong seasonal wind in Winter normally. Therefore, the
+sea tourism in Summer and Winter is adversely affected. Intense sales and marketing activities are required.
+
+ 
+
+4 
+Competition
+
+ 
+
+The
+government of Taiwan maintains a favorable stance on the development of the yacht industry. As such, the continued investments in yacht
+related businesses and marina infrastructure by the government has led to fierce competition among the companies here. Due to the limited
+number of ports along the coastline, additional effort and funds will be required to capture market share.
+
+ 37
+
+ 
+
+ 
+
+Risks
+Related to Ownership of Our Common Shares
+
+ 
+
+We
+are offering 10,000,000 common shares without an underwriter and may be unable to sell any shares. We are not going to engage the services
+of an underwriter to sell the shares; we intend to sell our shares through our officers and directors, who will receive no commissions.
+They will offer the shares to friends, family members, and business associates, however, there is no guarantee that they will be able
+to sell any of the shares. Unless they are successful in selling all of the shares and we receive the proceeds from this offering, we
+may have to seek alternative financing to implement our business plan.
+
+ 
+
+Because
+there is no minimum proceeds the Company can receive from its offering of 10,000,000 shares. The Company may not raise sufficient capital
+to implement its planned business and your entire investment could be lost.
+
+ 
+
+The
+Company is offering of 10,000,000 shares of common shares on a best-efforts basis and there is no minimum amount of proceeds the Company
+expect to receive. Funds raised under this offering will not be held in trust or in any escrow account and all funds raised regardless
+of the amount will be available to the Company. In the event the company is unable to raise sufficient capital to implement its planned
+operations, your entire investment could be lost. As the company is still developing its businesses
+and weathering the effects of the COVID-19 pandemic, our major shareholders have agreed to provide sufficient funding for company operations
+if needed.
+
+ 
+
+There
+is limited liquidity as our common shares are quoted on the OTCQB of the OTC Markets., In such an event, it may be difficult for you
+to sell your shares. We may, in the future, issue additional common shares, which would reduce investors percent of ownership
+and may dilute our share value.
+
+ 
+
+Our
+Articles of Incorporation authorize the issuance of 70,000,000 shares of common shares and 5,000,000 shares of preferred stock. As of
+the date of this prospectus, the Company had 25,546,810 shares of common shares outstanding. Accordingly, we may issue up to an additional
+10,000,000 shares of common stock. The future issuance of common shares may result in substantial dilution in the percentage of our common
+shares held by our then existing shareholders. We may value any common shares in the future on an arbitrary basis. The issuance of common
+shares for future services or acquisitions or other corporate actions may have the effect of diluting the value of the shares held by
+our investors, and might have an adverse effect on any trading market for our common shares.
+
+ 
+
+As
+we do not intend to pay any cash dividends on our common shares in the near future, our stockholders will not be able to receive a return
+on their shares unless they sell them.
+
+ 
+
+We
+intend to retain any future earnings to finance the development and expansion of our business. We do not anticipate paying any cash dividends
+on our common shares in the foreseeable future. Unless we pay dividends, our stockholders will not be able to receive a return on their
+shares unless they sell them. There is no assurance that stockholders will be able to sell shares when desired.
+
+ 
+
+Investors
+and financial professionals should consider the potential risks related to the PCAOB s lack of access to inspect PCAOB-registered
+accounting firms in China and Hong Kong. Also, the SEC, U.S. Department of Justice ( DOJ ) and other authorities often have
+substantial difficulties in conducting investigations and inspections or in bringing and enforcing actions against non-U.S. persons,
+including company directors and officers, in certain emerging markets, including China and Hong Kong . On August 26, 2022, the CSRC,
+the Ministry of Finance (MOF), and the PCAOB signed the Protocol, governing inspections and investigations of audit firms based in China
+and Hong Kong. Pursuant to the fact sheet with respect to the Protocol disclosed by the SEC, the PCAOB shall have independent discretion
+to select any issuer audits for inspection or investigation and has the unfettered ability to transfer information to the SEC. However,
+uncertainties still exist as to whether and how this new Protocol will be implemented and whether the PCAOB can make a determination
+that it is able to inspect and investigate completely in mainland China and Hong Kong. When the PCAOB reassesses its determinations by
+the end of 2022, it could determine that it is still unable to inspect and investigate completely with regard to registered accounting
+firms based in China and Hong Kong.
+
+ 
+
+Our
+share structure with different voting rights will limit your ability to influence corporate matters and could discourage others from
+pursuing any change of control transactions that holders of our common shares may view as beneficial.
+
+ 
+
+We
+have adopted a hare structure consists of common shares and Preferred Shares. In respect of matters requiring the votes of shareholders,
+each common share is entitled to one vote and each Preferred Share is entitled to fifty (50) votes. Each Preferred Shares may be converted
+into ten (10) common shares by its holder.
+
+ 
+
+We
+have authorized 5,000,000 Preferred Shares and Honetech Inc, a Samoa company, beneficially owns all of the 832,200 issued and outstanding
+Preferred Shares. Mr. Yun-Kuang Kung through the appointment by Honetech Inc, exercise the voting power of
+
+ 38
+
+ 
+
+ 
+
+these Preferred Shares. Therefore,
+Honetech Inc and Yun-Kuang Kung both control 41,600,000 votes, which constitute approximately 54.7% of the aggregate voting power of
+the Company assuming we are able to successfully sell all the 10,000,000 shares registered in this Registration Statement.
+
+ 
+
+As
+a result of this share structure, the holder of our Preferred Shares will have concentrated control over the outcome of matters put to
+a vote of shareholders and have significant influence over our business, including decisions regarding mergers, consolidations, liquidations
+and the sale of all or substantially all of our assets, election of directors and other significant corporate actions. The holder of
+Preferred Shares may take actions that are not in the best interest of us or our other shareholders. This concentration of ownership
+may discourage, delay or prevent a change in control of our company, which could have the effect of depriving our other shareholders
+of the opportunity to receive a premium for their shares as part of a sale of our company and may reduce the price of the common share.
+This concentrated control will limit your ability to influence corporate matters and could discourage others from pursuing any potential
+merger, takeover or other change of control transactions that holders of common shares may view as beneficial.
+
+ 
+
+If
+the holder of our Preferred Shares decides to convert into common shares in full, we will issue 8,320,000 shares of common shares to
+Honetech Inc. This issuance of common shares will dilute the value of the common shares you own in our company and reduce your ownership
+proportion in our company.
+
+ 
+
+Our
+common shares have been thinly traded and you may be unable to sell at or near ask prices or at all if you need to sell your shares to
+raise money or otherwise desire to liquidate your shares. 
+
+ 
+
+Our
+common shares may be thinly-traded , meaning that the number of persons interested in purchasing our common shares at or
+near bid prices at any given time may be relatively small or non-existent. This situation may be attributable to a number of factors,
+including the fact that we are relatively unknown to stock analysts, stock brokers, institutional investors and others in the investment
+community that generate or influence sales volume, and that even if we came to the attention of such persons, they tend to be risk-averse
+and might be reluctant to follow an unproven company such as ours or purchase or recommend the purchase of our shares until such time
+as we became more seasoned. As a consequence, there may be periods of several days or more when trading activity in our shares is minimal
+or non-existent, as compared to a seasoned issuer which has a large and steady volume of trading activity that will generally support
+continuous sales without an adverse effect on share price. A broad or active public trading market for our common shares may not develop
+or be sustained. 
+
+ 
+
+If
+securities or industry analysts do not publish research or reports about our business, or if the publish a negative report regarding
+our common shares, the price of our common shares and trading volume could decline.
+
+ 
+
+Any
+trading market for our common shares may depend in part on the research and reports that industry or securities analysts publish about
+us or our business. We do not have any control over these analysts. If one or more of the analysts who cover us downgrade us, the price
+of our common shares would likely decline. If one or more of these analysts cease coverage of our company or fail to regularly publish
+reports on us, we could lose visibility in the financial markets, which could cause the price of our common shares and the trading volume
+to decline.
+
+ 
+
+The
+market price for our common shares may be volatile. 
+
+ 
+
+The
+trading price of our common shares may be volatile and could fluctuate widely due to factors beyond our control. This may happen because
+of the broad market and industry factors, like the performance and fluctuation of the market prices of other companies with business
+operations located mainly in China that have listed their securities in the United States. A number of Chinese companies have listed
+or are in the process of listing their securities on U.S. stock markets. The securities of some of these companies have experienced significant
+volatility, including price declines in connection with their initial public offerings. The trading performances of these Chinese companies 
+securities after their offerings may affect the attitudes of investors toward Chinese companies listed in the United States in general
+and consequently may impact the trading performance of our common shares, regardless of our actual operating performance.
+
+ 
+
+The
+market price for our common shares may be volatile and subject to wide fluctuations due to factors such as: 
+
+ 
+
+ 
+ 
+ 
+ actual
+ or anticipated fluctuations in our operating results;
+
+ 
+ 
+
+ 
+ 
+ 
+ changes
+ in financial estimates by securities research analysts;
+
+ 
+ 
+
+ 
+ 
+ 
+ negative
+ publicity, studies or reports;
+
+ 
+
+ 39
+
+ 
+
+ 
+
+ 
+ 
+ 
+ our
+ capability to catch up with the technology innovations in the industry;
+
+ 
+ 
+
+ 
+ 
+ 
+ changes
+ in the economic performance or market valuations;
+
+ 
+ 
+
+ 
+ 
+ 
+ announcements
+ by us or our competitors of acquisitions, strategic partnerships, joint ventures or capital commitments;
+
+ 
+ 
+
+ 
+ 
+ 
+ addition
+ or departure of key personnel;
+
+ 
+ 
+
+ 
+ 
+ 
+ fluctuations
+ of exchange rates between RMB, NTD and the U.S. dollar; and
+
+ 
+ 
+
+ 
+ 
+ 
+ general
+ economic or political conditions in Taiwan and China.
+
+ 
+ 
+
+In
+addition, the securities market has from time-to-time experienced significant price and volume fluctuations that are not related to the
+operating performance of particular companies. These market fluctuations may also materially and adversely affect the market
+price of our common shares. 
+
+ 
+
+Volatility
+in our common share price may subject us to securities litigation.
+
+ 
+
+The
+market for our common shares may have, when compared to seasoned issuers, significant price volatility and we expect that our share price
+may continue to be more volatile than that of a seasoned issuer for the indefinite future. In the past, plaintiffs have often initiated
+securities class action litigation against a company following periods of volatility in the market price of its securities. We may, in
+the future, be the target of similar litigation. Securities litigation could result in substantial costs and liabilities and could divert
+management s attention and resources. 
+
+ 
+
+In
+order to raise sufficient funds to enhance operations, we may have to issue additional securities at prices which may result in substantial
+dilution to our shareholders.
+
+ 
+
+If
+we raise additional funds through the sale of equity or convertible debt, our current shareholders percentage ownership will be
+reduced. In addition, these transactions may dilute the value of common shares outstanding. We may have to issue securities that may
+have rights, preferences and privileges senior to our common shares. We cannot provide assurance that we will be able to raise additional
+funds on terms acceptable to us, if at all. If future financing is not available or is not available on acceptable terms, we may not
+be able to fund our future needs, which would have a material adverse effect on our business plans, prospects, results of operations
+and financial condition.
+
+ 
+
+The
+Holding Foreign Companies Accountable Act was signed into law on December 18, 2020, and requires Auditors of publicly traded
+companies to submit to regular inspections every three years to assess such auditors compliance with applicable professional
+standards. On June 22, 2021, the U.S. Senate. passed the Accelerating Holdings Foreign Companies Accountable Act the AHFCA
+Act )which, if passed by the U.S. House of Representatives and signed into law, would reduce the number of consecutive
+non-inspection years required for triggering the prohibitions under the HFCA Act from three years to two, thus reducing the time
+before our securities may be prohibited from trading or delisted. As a result, the time period before our securities may be
+prohibited from trading or delisted will be reduced. If the U.S. securities regulatory agencies are unable to conduct such
+investigations, there exists a risk that they may determine to suspend or de-register our registration with the SEC and may also
+delist our securities from applicable trading market within the US. On December 2, 2021, the SEC adopted final amendments
+implementing congressionally mandated submission and disclosure requirements of the Holding Foreign Companies Accountable Act. The
+rules apply to registrants that the SEC identifies as having filed an annual report with an audit report issued by a registered
+public accounting firm that is located in a foreign jurisdiction and that PCAOB is unable to inspect or investigate completely
+because of a position taken by an authority in foreign jurisdictions.
+
+ 
+
+According
+to Article 177 of the Securities Law of the PRC ( Article 177 ), overseas securities regulatory authorities are prohibited
+from engaging in activities pertaining to investigations or evidence collection directly conducted within the territories of the PRC,
+and Chinese entities or individuals are further prohibited from providing documents and information in connection with securities business
+activities to any organizations and/or persons abroad without the prior consent of the securities regulatory authority of the State Council
+and the competent departments of the State Council. As of the date of this prospectus, we are not aware of any implementing rules or
+regulations which have been published regarding application of Article 177.
+
+ 
+
+We
+believe Article 177 is only applicable where the activities of overseas authorities constitute a direct investigation or evidence
+collection by such authorities within the territory of the PRC. Our principal business operation is conducted in Taiwan. In the
+event that the U.S. securities regulatory agencies carry out an investigation on us such as an enforcement action by the Department
+of Justice, the SEC or other authorities, such agencies activities will constitute conducting an investigation or collecting
+evidence
+
+ 40
+
+ 
+
+ 
+
+directly
+within the territory of the PRC and accordingly fall within the scope of Article 177. In that case, the U.S. securities regulatory
+agencies may have to consider establishing cross-border cooperation with the security s regulatory authority of the PRC by way of
+judicial assistance, diplomatic channels or establishing a regulatory cooperation mechanism with the security s regulatory authority
+of the PRC. However, there is no assurance that the U.S. securities regulatory agencies will succeed in establishing such
+cross-border cooperation in this particular case and/or establish such cooperation in a timely manner. Furthermore, it remains
+unclear as to how Article 177 will be interpreted, implemented or applied by the Chinese Securities Regulatory Commission or other
+relevant government authorities. As such, there are uncertainties as to the procedures and requisite timing for the U.S. securities
+regulatory agencies to conduct investigations and collect evidence within the territory of the PRC. The Holding Foreign Companies
+Accountable Act requires the Public Company. Accounting Oversight Board (PCAOB) be permitted to inspect the issuer s public
+accounting firm within three years. If the U.S. securities regulatory agencies are unable to conduct such investigations, there
+exists a risk that they may determine to suspend or de-register our registration with the SEC and may also delist our securities
+from applicable trading market within the US.
+
+ 
+
+Our
+current auditor is located in the U.S. and is subject to PCAOB inspections. Since it is not located in either China or Hong Kong, it
+is not subject to the determinations announced by the PCAOB on December 16, 2021. However, our 2020 auditor is based in Hong Kong and
+is subject to the determination that the Board is unable to inspect or investigate completely registered public accounting firms headquartered
+in Hong Kong, a Special Administrative Region and dependency of the PRC, because of a position taken by one or more authorities in Hong
+Kong ( the Hong Kong Determination ).
+
+ 
+
+On
+August 26, 2022, the PCAOB announced that it had signed a Statement of Protocol (the SOP ) with the China Securities Regulatory
+Commission and the Ministry of Finance of China. The SOP, together with two protocol agreements governing inspections and investigations
+(together, the SOP Agreement ), establishes a specific, accountable framework to make possible complete inspections and
+investigations by the PCAOB of audit firms based in mainland China and Hong Kong, as required under U.S. law. The SOP Agreement remains
+unpublished and is subject to further explanation and implementation. Pursuant to the fact sheet with respect to the SOP Agreement disclosed
+by the SEC, the PCAOB shall have sole discretion to select any audit firms for inspection or investigation and the PCAOB inspectors and
+investigators shall have a right to see all audit documentation without redaction. According to the PCAOB, its December 2021 determinations
+under the HFCA Act remain in effect. The PCAOB is required to reassess these determinations by the end of 2022. Under the PCAOB s
+rules, a reassessment of a determination under the HFCA Act may result in the PCAOB reaffirming, modifying or vacating the determination.
+However, if the PCAOB continues to be prohibited from conducting complete inspections and investigations of PCAOB-registered
+public accounting firms in mainland China and Hong Kong, the PCAOB is likely to determine by the
+end of 2022 that positions taken by authorities in the PRC obstructed its ability to inspect and investigate registered public accounting
+firms in mainland China and Hong Kong completely, then the companies audited by those registered public accounting firms would be subject
+to a trading prohibition on U.S. markets pursuant to the HFCA Act.
+
+ 
+
+Due
+to the recent developments in connection with the implementation of the Holding Foreign Companies Accountable Act, we cannot assure you
+whether the SEC or other regulatory authorities would apply additional and more stringent criteria to us after considering the effectiveness
+of our auditor s audit procedures and quality control procedures, adequacy of personnel and training, or sufficiency of resources,
+geographic reach or experience as it relates to the audit of our financial statements. The requirement in the AHFCA Act that the PCAOB
+be permitted to inspect the issuer s public accounting firm within two years, may result in the delisting of our securities from
+applicable trading markets in the U.S, in the future if the PCAOB is unable to inspect or investigate our previous and current registered
+accounting firm at such future time.
+
+ 
+
+USE
+OF PROCEEDS
+
+ 
+
+Our
+public offering of 10,000,000 shares is being made on a self-underwritten basis: no minimum number of shares must be sold in order for
+the offering to proceed. The offering price per share is $1.00. There is no assurance that we will raise $10,000,000 in full.
+
+ 
+
+We
+plan to use the proceeds from the offering to increase our working capital to support our yacht operations and the research and development
+of all-electric vessels, including recruiting more qualified staff, developing more electric vessel prototypes and carrying out more
+testing.
+
+ 
+
+The
+information above involved planning and anticipation and there is no guarantee that they will be completely achieved in the future.
+
+ 
+
+This
+registration statement also registers 10,986,204 shares of common shares to be sold by Selling Shareholders. Selling Shareholders will
+sell the shares by themselves and we will not receive any proceeds from the sale of these shares.
+
+ 41
+
+ 
+
+ 
+
+DETERMINATION
+OF OFFERING PRICE
+
+ 
+
+The
+offering price of $1.00 for the 10,000,000 shares of common shares does not bear any relationship to our assets, book value, earnings,
+or other established criteria for valuing a public or privately held company. In determining the number of shares to be offered and the
+offering price, we took into consideration our cash on hand and the amount of money we would need to implement our business plan. Accordingly,
+the offering price should not be considered an indication of the actual value of the securities.
+
+ 
+
+DILUTION
+
+ 
+
+The
+price of our offering in this prospectus of 10,000,000 shares is fixed at $1.00 per share.
+
+ 
+
+If
+you invest in our common shares, you will incur immediate dilution since the public offering price per share you will pay in this offering
+is more than the net tangible book value per ordinary share immediately after this offering.
+
+ 
+
+As
+of the unaudited balance sheet on September 30, 2022, the total shareholders deficit of Vivic Corp. ($829,011) and preferred stock
+is $832, the capital contribution is $3,745,463, which included share capital of the common shares issued and outstanding $25,547 and
+additional paid-in capital $3,873,719, the number of common shares outstanding is 25,546,810. It is assumed that the offering expenses
+is 1% on new offering capital contribution. The dilution calculation below is based on the information as of September 30, 2022. 
+
+ 
+
+The
+net tangible book value of our ordinary shares as of September 30, 2022 was ($835,248), or ($0.03) per share based upon 25,546,810 common
+shares outstanding. Net tangible book value per share represents the amount of our total tangible assets reduced by the amount of our
+total liabilities, divided by the total number of ordinary shares outstanding. Tangible assets equal our total assets less intangible
+assets, deferred tax assets and deferred offering cost.
+
+ 
+
+The
+dilution in net tangible book value per share to new investors, represents the difference between the amount per share paid by purchasers
+of shares in this offering and the pro forma net tangible book value per share immediately after completion of this offering. After giving
+effect to the sale of the 10,000,000 shares being sold pursuant to this offering price of $1.00 per share and after deducting estimated
+offering expenses in the amount of $100,000, our pro forma net tangible book value would be approximately $9,164,752, or $0.26 per share
+of common shares. This represents an immediate increase in net tangible book value of $0.28 per share to existing shareholders and an
+immediate decrease in net tangible book value of $0.74 per share to new investors purchasing the shares in this offering.
+
+ 
+
+The
+following table illustrates this per share dilution:
+
+ 
+
+ 
+ 
+ As
+of September 30,
+
+2022
+ 
+
+ 
+ Offering price per common share 
+ $1.00 
+
+ 
+ Net tangible book value per share as of September 30,2022 
+ $(0.03)
+
+ 
+ Increase in net tangible book value per share attributable to existing shareholders 
+ $0.29 
+
+ 
+ Pro forma net tangible book value per share after this offering 
+ $0.26 
+
+ 
+ Dilution per share to new investors 
+ $0.74 
+
+ 
+
+ 
+
+A
+$1.00 increase (decrease) in the assumed public offering price would increase (decrease) our pro forma net tangible book value per share
+after this offering by approximately $9.9 million, and increase the dilution per share to new investors by approximately $0.61, after
+deducting the estimated offering expenses payable by us.
+
+ 
+
+The
+following table sets forth, on a pro forma as adjusted basis as of September 30, 2022, the difference between the number of ordinary
+shares purchased from us, the total cash consideration paid, and the average price per share paid by our existing shareholders and by
+new public investors before deducting estimated offering expenses payable by us, using an assumed public offering price of $1.00 per
+common share:
+
+ 
+
+ 
+ 
+ Shares Purchased 
+ Total Cash Consideration 
+ Average
+ Price Per 
+
+ 
+ 
+ Number 
+ Percent 
+ Amount 
+ Percent 
+ Share 
+
+ 
+ Existing shareholders 
+ 25,546,810 
+ 71.9% 
+ $3,899,266 
+ 28.3% 
+ $0.15 
+
+ 
+ New investors from public offering 
+ 10,000,000 
+ 18.1% 
+ $9,900,000 
+ 71.7% 
+ $1.00 
+
+ 
+ Total 
+ 35,546,810 
+ 100.00% 
+ $13,799,266 
+ 100.00% 
+ $0.39 
+
+ 
+
+ 42
+
+ 
+
+ 
+
+The
+pro forma as adjusted information discussed above is illustrative only. Our net tangible book value following the completion of this
+offering is subject to adjustment based on the actual initial public offering price of our common shares and other terms of this offering
+determined at pricing.
+
+ 
+
+If
+you invest in our ordinary shares, you will incur immediate dilution since the public offering price per share you will pay in this offering
+is more than the net tangible book value per ordinary share immediately after this offering.
+
+ 
+
+DIVIDEND
+POLICY
+
+ 
+
+We
+have not declared or paid dividends on our common shares since our formation, and we do not anticipate paying dividends in the foreseeable
+future. Declaration or payment of dividends, if any, in the future, will be at the discretion of our Board of Directors and will depend
+on our then current financial condition, results of operations, capital requirements and other factors deemed relevant by the Board of
+Directors. There are no contractual restrictions on our ability to declare or pay dividends. See the Risk Factor entitled, Because
+we do not intend to pay any cash dividends on our common shares, our stockholders will not be able to receive a return on their shares
+unless they sell them. 
+
+ 
+
+PLAN
+OF DISTRIBUTION
+
+ 
+
+We
+have 25,546,810 shares of common shares issued and outstanding as of the date of this prospectus. The Company is registering 10,000,000
+shares of its common shares for sale at the price of $1.00 per share. There is no arrangement to address the possible effect of the offering
+on the price of the stock. In connection with the Company s selling efforts in the offering, our officers, will not register as
+a broker-dealer pursuant to Section 15 of the Exchange Act, but rather will rely upon the safe harbor provisions of SEC
+Rule 3a4-1, promulgated under the Securities Exchange Act of 1934, as amended (the Exchange Act ). Generally speaking, Rule
+3a4-1 provides an exemption from the broker-dealer registration requirements of the Exchange Act for persons associated with an issuer
+that participate in an offering of the issuer s securities. Our officers will not be compensated in connection with their participation
+in the offering by the payment of commissions or other remuneration based either directly or indirectly on transactions in our securities.
+Further, our current officers are not, nor have he been within the past 12 months, a broker or dealer, and they are not, nor have he
+been within the past 12 months, an associated person of a broker or dealer. will continue to primarily perform substantial duties for
+the Company or on its behalf otherwise than in connection with transactions in securities.
+
+ 
+
+The
+Company s shares may be sold to purchasers from time to time directly by and subject to the discretion of the Company. Further,
+the Company will not offer its shares for sale through underwriters, dealers, agents or anyone who may receive compensation in the form
+of underwriting discounts, concessions or commissions from the Company and/or the purchasers of the shares for whom they may act as agents.
+The shares of common shares sold by the Company may be occasionally sold in one or more transactions; all shares sold under this prospectus
+will be sold at a fixed price of $1.00 per share.
+
+ 
+
+In
+addition, it is expected that these 10,000,000 shares of common shares offered will be marketed to our business associates and/or clients.
+Potential investors mainly come from China, Taiwan and other countries across the globe. The allocation ratio has not been determined
+as of now. Furthermore, shares of the common shares may not be sold to purchasers in full.
+
+ 
+
+This
+prospectus also registers 10,986,204 shares of common shares to be sold by Selling Shareholders. Selling Shareholders will sell the shares
+by themselves and we will not receive any proceeds from the sale of these shares.
+
+ 
+
+Terms
+of the Offering 
+
+ 
+
+The
+shares will be sold at the fixed price of $1.00 per share until the completion of this offering. There is no minimum amount of subscription
+required per investor, and subscriptions, once received, are irrevocable. This offering will commence on the date of this prospectus
+and continue for a period of 12 months. At the discretion of our board of directors, we may discontinue the offering before expiration
+of the 12-month period.
+
+ 
+
+In
+order to comply with the applicable securities laws of certain states, the securities will be offered or sold in those only if they have
+been registered or qualified for sale; an exemption from such registration or if qualification requirement is available and with which
+we have complied. In addition, and without limiting the foregoing, we will be subject to applicable provisions, rules and regulations
+under the Exchange Act with regard to security transactions during the period of time when this Registration
+
+ 43
+
+ 
+
+ 
+
+Statement is effective.
+We will pay all expenses with regard to the registration of the shares (including registration pursuant to the securities laws of certain
+states).
+
+ 
+
+BUSINESS
+
+ 
+
+We
+were incorporated on February 16, 2017 in the State of Nevada. In addition to the US administrative office, we also have business
+offices in Taiwan and China. We were initially a travel agency that organized individual and group tours in the Dominican Republic. Yoel
+Rosario Duran was the initial Chief Executive Officer, Chief Financial Officer, President, Treasurer, and Board Director. Dmitriy Perfilyev
+was the initial the Secretary of the Company. On December 27, 2018, Honetech Inc., a Samoa company, acquired the controlling percentage
+of our issued and outstanding stock from Yoel Rosario Duran and Dmitriy Perfilyev and became the controlling stockholder of the Company.
+Yoel Rosario Duran and Dmitriy Perfilyev resigned from all positions they held in the Company. Wen-Chi Huang, Kuen-Horng Tsai, Cheng-Hsing
+Hsu and Huilan Chen became board directors, and Yun-Kuang Kung became CEO. On November 1, 2019, Liu-Shiang Kung Hwang was appointed as
+a Board Director. On July 9, 2020, Wen-Chi Huang, Kuen-Horng Tsai, Yun-Kuang Kung,Liu-Shiang Kung Hwang and Huilan Chen no longer served
+as the board directors and officers of the Company. Shang-Chiai Kung was appointed as the Chairman of the Board of directors, President,
+Chief Executive Officer and Chief Financial Officer.
+
+ 
+
+Since
+the reshuffle of our management team on December 27, 2018, we expanded our business operations to include the operations of maritime
+tourism,yacht sales and development and commercialization of all-electric yachts in China and Taiwan. We acquired Guangzhou Monte Fino
+Yacht Co., Ltd, a Chinese limited liability company, in October 2019 to carry out business operation in China. Guangzhou Monte Fino Yacht
+Co., Ltd later changed its name to Vivic Guangdong Corporation Limited ( Vivic Guangdong ). Khashing Guangdong has been our
+major business operating entity in China. It holds an exclusive license to use Kha Shing Enterprise Company s brand name Monte
+Fino in China.
+
+ 
+
+We
+currently carry out the following business operations in China and Taiwan:
+
+ 
+
+(1)Development
+ and operations of yacht marinas. We have leased and operated a yacht marina in the downtown
+ of Wenzhou City, China.
+
+ 
+
+(2)We
+ developed and operated an online platform Joy Wave to provide yacht rental
+ and time-share services in China.
+
+ 
+
+(3)We
+ provided consulting services to other yacht marina operators related to the planning, marketing
+ and operating of yacht marinas
+
+ 
+
+(4)Research
+ and development of all- electric boats and yachts.
+
+ 
+
+Development
+and Operations of Yacht Marinas
+
+ 
+
+Development
+and operations of yacht marinas in China are our long-term business objective. Currently, we are still at the early developmental stage
+of this line of business. On November 30, 2020, our China subsidiary Khashing Guangdong entered into Wenzhou Yangfushan Marina Leasing
+Contract to lease and operate Wenzhou Yangfushan Yacht Marina. Under this agreement, we leased Wenzhou Yangfushan Marina from its landowner
+and developer for a term of 8 years. The marina has 18 berths that can fit yachts up to 60 feet, and can provide temporary berths of
+115 feet. At the same time, the marina also has a 2100 square feet office space that can be used for management and sailing training.
+There is another 21,000 square feet space for event rental. We will assume the full management and operation of this yacht marina and
+receive all the revenues generated from it. Under the contract, we shall pay to the landowner and the developer a fixed annual lease
+fee and some percentage of the operating revenue. The services we provide at this marina include yacht chartering, wedding photography,
+marina advertising, sailing events, yacht training, yacht sales, electric boat bases, etc. At the same time, a membership system will
+be adopted so that members can enjoy various membership benefits.
+
+ 
+
+Wenzhou
+Yangfushan Marina lease contract
+
+ 
+
+As
+the major marina lease in operations, Wenzhou Yangfushan Marina Leasing Contract ( Wenzhou Agreement ) is particularly important
+to our marina business. Our Chinese operating subsidiary Khashing Guangdong entered into the Wenzhou Agreement on January 15, 2021 with
+Wenzhou Urban Construction Investment Co., Ltd ( Wenzhou Urban ) and Wenzhou Liangye Environmental Technology Co., Ltd ( Wenzhou
+Liangye ).
+
+ 
+
+Under
+the Wenzhou Agreement, we leased the Yangfushan Marina for 5 years, from May 10, 2021 to May 9, 2026, and pay lease fee on an annual
+basis. The annual lease cost started at RMB 888,000 for the first year and will increase at 2% annually for the subsequent years.
+
+ 44
+
+ 
+
+ 
+
+In
+addition, we will share the revenues from the marina operations with Wenzhou Urban and Wenzhou Liangye as follows:
+
+ 
+
+(1)Advertising
+ revenue: We shall co-sign any advertisement contracts with Wenzhou Urban and will pay 7.5%
+ of the advertisement revenue individually to Wenzhou Urban and Wenzhou Liangye. We are required
+ to pay an annual minimum amount of RMB90,000 to Wenzhou Urban and Wenzhou Liangye in the
+ event that the revenue we generate from advertisement does not meet the minimum requirement.
+
+ 
+
+(2)Revenue
+ from sailboat training program: We are responsible for the management and operations of sailboat
+ training programs. We will pay 10% of the sailboat training revenues to Wenzhou Urban. We
+ are required to pay a minimum amount of RMB 30,000 to Wenzhou Urban in the event that the
+ revenue we generate from sailboat training program does not meet the minimum requirement.
+
+ 
+
+(3)We
+ retain all operating revenues generated from the berth.
+
+ 
+
+(4)We
+ are responsible for the utility costs associated with the operations of the marina.
+
+ 
+
+Wenzhou
+Yangfushan Marina revenues
+
+ 
+
+The
+Wenzhou Yangfushan Marina has been generating revenues as follows since 2021 (in Renminbi/RMB):
+
+ 
+
+1.Yacht
+ entertainment experience tours: RMB 126,679 in 2021 and RMB 51,209 in six months ended September
+ 30, 2022.
+
+ 
+
+2.Sailing
+ competition events: RMB 349,532 in 2021.
+
+ 
+
+3.Yacht
+ berth lease: RMB 8,911 in 2021.
+
+ 
+
+4.Yacht
+ training services: RMB 65,347 in 2021.
+
+ 
+
+ Joy
+Wave Online Platform
+
+ 
+
+Through
+Vivic Guangdong, we developed and operated an online platform named Joy Wave ( ) to provide yacht time-share,
+rental and charter services. Yacht owners can add their yachts onto Joy Wave for rental while customers can use the platform to book
+yachts. We are still developing the smartphone app for this web platform. 
+
+ 
+
+ Joy
+Wave is an essential platform to support our marina development and operations business. After a marina is built, customers will
+pay the charter and parking fees through the platform and book marine tourism products. Moreover, features on the program allow multiple
+members to purchase yacht by crowdfunding and then list their yacht for rental and lease on our platform. Users are able to receive referral
+fee if they refer others to join the membership.
+
+ 
+
+The
+platform has been tested in Guangzhou, Xiamen and Shenzhen, China. We are now operating the platform as a pilot program in Guangzhou,
+Xiamen and Wenzhou, China. The pilot program contributed US$100,000 to our revenue in 2021, during the COVID-19 pandemic period while
+most public leisure activities have been curtailed in these Chinese cities.
+
+ 
+
+Consulting
+Services
+
+ 
+
+We
+provide consulting services to other developers and operators of marinas related to the planning, marketing and operating of yacht marinas.
+We assist marina operator clients to promote their products through marketing channels, help to build customer relationships and increase
+brand loyalty and awareness. We help clients to develop marketing plan and packaging procedure. We also help clients evaluate their business
+performance to effectively control their manpower and costs. Instead of paying on a percentage of the total transaction, our clients
+pay a fixed monthly fee for our service. Please see the service agreement with Everest Capital Corporation in attachment. We introduce
+clients to the internet platform and assist them with broadcasting their business to the platform. We use our experience and technology
+on the network platform to help our clients expand their customer base.
+
+ 
+
+We
+have provided consulting services to Kinmen Marina in Taiwan. We utilized our experiences in marina design and operation to conduct preliminary
+planning through on-site surveys, and utilize our local connections to help the client develop and construct the Kinmen Marina.
+
+ 45
+
+ 
+
+ 
+
+Research
+and Development of All-Electric Boats
+
+ 
+
+Starting
+August 2020, we started the research and development of all-electric boats. We have developed several prototypes and are still in the
+process of improving and testing the technology for commercial production. We expect that the boating
+industry will follow the electrification roadmap of the automotive industry by creating all-electric boats that meet or exceed the traditional
+boating consumer s expectations of price, value and run times. In other words, electric boats must offer a similar recreation experience
+when compared to traditional fuel-powered boat in terms of size, capability and price point. Since we expedited our electric boat
+R&D in the past months, we anticipated that our all-electric boat commercialization will realize and begin to sell to customers by
+the end of 2022. But we cannot guarantee that we may progress or the commercialization of all-electric boats may develop as expected
+due to lack of funding and the impact of COVID-19 pandemic.
+
+ 
+
+Dealership
+and Sale Agreement with Kha Shing 
+
+ 
+
+On
+September 18,2019, we entered into an exclusive dealership and sales agreement with Kha Shing Enterprise Co., LTD, a leading and a renowned
+yacht and recreational boat builder based in Taiwan. In the agreement, we were granted an exclusive period of five years to sell Monte
+Fino Yachts manufactured by Kha Shing. Also, we should sell at least one unit of vessel during the first 18 months, and five units of
+vessel during the term. Since we signed the agreement with Kha Shing, China has implemented several times of lockdown in some cities
+due to COVID-19 pandemic and our sales effort was impacted. Despite the terms of the agreement, Kha Shing notified us that it would not
+cancel the exclusive and sale agreement even if we did not sell enough units of vessel to meet the minimum requirement.
+
+ 
+
+We
+received an order from a customer to purchase a 45-foot Monte Fino Yacht valued at RMB 3 million in October 2021, and we expect to deliver
+the yacht by the end of 2022. Since the COVISD-19 vaccine vaccination population has increased significantly as of the date and the decreased
+transmission rate and effect of the virus, the business activities have begun to recover to normal,we are increasing our sales and marketing
+efforts in China to sell Monte Fino Yachts and other yachts.
+
+ 
+
+Cooperation
+and Partnership with Other Parties 
+
+ 
+
+We
+have entered into some cooperation or partnership agreement with several other parties since the current management team took over the
+Company in late 2018. Since these agreements were not significant in terms of revenue generation or these agreements have expired without
+bringing much business value to us, we decided not discuss them in this Prospectus, however, we include them as exhibits in the Registration
+Statement.
+
+ 
+
+Industry
+Overview
+
+ 
+
+We
+carry out business operations mainly in Taiwan and China. Therefore, the industry overview is primary regarding Taiwan and Chinese markets.
+
+ 
+
+Background
+of Taiwan s yacht industry
+
+ 
+
+Based
+on the information depicted in Chapter 7 Yachts in The Law of Ships by Taiwan Ministry of Transportation and Communications and Taiwan
+Shipbuilding Industry Association and Wikipedia, yacht manufacturing in Taiwan began from 1958 to the 1990s. It was started by the introduction
+of the US military in Taiwan and the combination of domestic sampan manufacturers. Later, foreign customers used yacht design drawings
+to find domestic manufacturers to accept orders and import glass fibers from abroad. Some manufacturers directly purchase design drawings
+from customers for mass production to reduce costs, and profits increased after the rapid growth of orders. Because domestic manufacturers
+only focused on OEM production in the industrial chain in the 1990s, the main market for yachts started shrinking. Yacht manufacturers
+have begun to diversify the market and seek technological upgrades, as well as to strengthen customization and increase added value.
+From 2000 to 2011, Taiwan s yacht manufacturers began to conduct strategic alliances and improve the infrastructure of manufacturing
+engineering. This led to the development of larger markets such as customization and mega yachts. Those yachts include fiberglass yachts,
+luxury yachts, customized medium and large power yachts, and high-end custom sailing boats. The yachts range from 38 feet to 150 feet,
+and most of them are luxury yachts from 60 feet to 80 feet
+
+ 
+
+The
+standards of environmental protection have been increasing in recent decades. For example, The European Union and International Maritime
+Organization ( IMO ) has been implementing the new marine engine emission standards since 2008. The yachts with traditional
+diesel engines produce massive waste and lead to environmental pollution. Nowadays, the lithium battery with its clean energy is prevailing
+in the electric yachts industry. As they are eco-friendly, these liquified natural gas ( LNG ) yachts and electric yachts
+are the latest favorites in the market. Because electric yachts are made with zero-emission and low-noise level engines, they can easily
+meet energy-saving and emission control requirements. The trading volume of electric yachts
+
+ 46
+
+ 
+
+ 
+
+increased tremendously in last decades. As
+yachts batteries and hybrid yachts become more advanced, the industry of electric yachts will continue its growth after 2020. We believe
+that eventually all-electric boats and yachts will completely replace their gasoline or diesel-powered counterparts, especially in the
+rivers, lakes, and coastal waters. The demand for the less polluting ships in Taiwan, China, South East Asia, and Europe are particularly
+high as there are millions of gas or diesel-powered ships in use in these regions and have caused severe pollution to their waters.
+
+ 
+
+However,
+one issue should be borne in mind that electric yachts replacing traditional diesel yachts is a continuing process. Both should be co-existed
+for a long time, like the motor vehicle with new-energy engine and the traditional one.
+
+ 
+
+There
+are ginormous potential markets for electric yachts in the Asian countries including Japan, Taiwan, PRC, and the Middle East countries.
+There are 400,000 yachts and skiffs in Japan and mostly are fishing boats. The skiffs are equipped with battery electric or hybrid module
+for efficiency. Further, the buyers of small-sized yachts are more price-conscious. Electric yachts will cut the costs down. Japan has
+more potentials in product update in the future. The Asian countries, like Taiwan and PRC, and the Middle East countries are emerging
+markets of yachts. They are the right places for launching new products. For our marketing strategy, new products are used for capturing
+the new market share and increasing the existing market share.
+
+ 
+
+For
+yacht marketing activities, the size of exhibitions reveals the tremendous potential in the Asian markets. The yacht exhibition Singapore
+is the largest one in Asia. Only 11 yachts participated in the yacht exhibition Singapore 2011. Favorably, approximate 100 exhibitors
+joined the same in 2019, more than 80 yachts participated and attracted over 16,000 people entered into it. The number of yachts participated
+in this exhibition approximately 8 times increased from the one in 2011. This reflects high growth rate in the Asian yacht markets.
+
+ 
+
+There
+are different needs from different Asian yacht markets. The high-GDP groups in Hong Kong and PRC become the potential growth markets
+for yacht industry. However, there is great divergence among the Asian and Western customers regarding the yacht specifications. Asian
+markets focus on the size instead of the number of functional areas of yachts. It is because they normally cruise with short-distance
+in day time but not long-distance at night. Therefore, there are a lot of works to be accomplished for developing the markets. Catamarans
+are popular in the Asian countries because they provide more spacious areas with stable navigation. They are also able to access to the
+shallow water for more fun.
+
+ 
+
+In
+the research Global Electric Boats, Small Submarines and Autonomous Underwater Vehicles (AUV) 2015-2024 – Forecasts, Players,
+Opportunities from an international market research company, Research and Markets, it shows that the market of marine electric
+vehicles will rapidly grow due to the new capability, affordability and legislation banning or restricting internal combustion engines.
+The electric water craft will increase from $2.6 billion in 2013 to $7.3 billion in 2024 (quote from Research and Markets). It is approximate
+RMB 45.31 billion. The prospect in the electric boats is optimistic.
+
+ 
+
+Related
+Laws and Regulations of Ships in Taiwan
+
+ 
+
+Since
+the lifting of the Taiwan Maritime Ban, Taiwan s government has actively promoted water leisure activities. The Ministry of Communications
+revised The Law of Ships and added a special chapter for yachts (Chapter 7 of the Law of Ships), which was announced and
+implemented on December 8, 1999.
+
+ 
+
+On
+this basis, the Ministry of Communications issued the Yacht Management Rules on August 20, 2001. From then on, Taiwanese
+residents can purchase and use yachts for water recreation activities, and Taiwan officially entered the first year of water recreation.
+
+ 
+
+The
+Port and Port Bureau of the Ministry of Communications announced on March 25th, 2002, the Ship and Ocean Industries R&D Center was
+to become a yacht verification agency. The ship center provides RINA-Italian ship certification services, CE certification services,
+MCA business yacht certification services and other certification services.
+
+ 
+
+In
+accordance with the Law of Ships promulgated by the Ministry of Transportation and Communications in Taiwan, yachts need to implement
+a battery endurance test for electric boat. This standard of the test has been covered in our R&D procedures. We are confident that
+our electric boats can pass this test.
+
+ 
+
+The
+background of China s yacht industry
+
+ 
+
+Yacht
+Manufacturing
+
+ 
+
+According
+to the statistics in the China Yacht Industry Development Summary Report of Shanghai Shipbuilding Industry Association and
+China Shipbuilding Industry Association Boat Branch, China s yacht industry started in the 1950s and
+
+ 47
+
+ 
+
+ 
+
+experienced a slow development
+process for decades. The initial development of the yacht industry did not appear until the beginning of this century. Based on the development
+and construction of leisure (or household) yachts, the development of China s yacht industry is divided into the following four stages:
+
+ 
+
+The
+first stage, the introduction of FRP technology, digestion, and absorption stage (late 1950s-60s)
+
+ 
+
+The
+second stage is the stage of laying the technical foundation for OEM export of OEM processing (in the early 1980s-90s of the 20th century)
+
+ 
+
+The
+third stage is the development stage of yacht manufacturing driven by market demand at home and abroad (from the late 1990s to 2008)
+
+ 
+
+The
+fourth stage, the possible rise of opportunities caused by the financial turmoil (from 2008 to the present)
+
+ 
+
+As
+of 2010, there were more than 370 yacht manufacturing companies in Mainland China, and more than 30 companies with an output value of
+more than 10 million yuan. These companies are mainly concentrated in Shenzhen, Shanghai, Qingdao, Tianjin, Xiamen, Zhuhai and other
+cities.
+
+ 
+
+In
+2017, Taiwan s export volume of mega yachts ranked first in Asia and fifth in the world. Exported 120 mega yachts with a total value
+of 200 million U.S. dollars. Taiwan has firmly established itself as a leader in the production of mega yachts in Asia. Because of this,
+many Chinese yacht manufacturers use Taiwan s managers and designs.
+
+ 
+
+According
+to the China s Yacht Industry Report 2016-2021 (DUBLIN, April 06, 2017 /PRNewswire), manufacturing costs of yachts is 20% to 30% lower
+in China than that in Europe or North American countries. The yacht market is expected to remain an annual growth rate of over 10% because
+of the increasing high-income earners and yacht registration policies in China in the next few years.
+
+ 
+
+Yacht
+Sale
+
+ 
+
+According
+to the statistics of the article The current situation of China s yacht industry in 2019, changes in consumption concepts, and
+the prospects for yacht consumption by Huajing Information Network (huaon.com), with the rapid economic development and the improvement
+of living standards, some coastal cities in China already have the economic conditions to consume yachts. As such, the development of
+the yacht industry is entering a golden age. In 2018, China s yacht production reached 2010, of which the luxury yacht market sales
+were approximately RMB 5.11 billion, accounting for 44.6% of the entire yacht industry, with an average annual growth rate of more than
+30%. In 2018, the total number of Chinese yachts reached 22,060, and it is estimated that by 2025, the total number of Chinese yachts
+will reach 163,510. According to customs data, China s yacht exports in 2017 were US$258 million, an increase of 24.1%, and imports
+also increased by 24.1% year-on-year to US$218 million. In 2018, the import volume of Chinese yachts fell by 47% compared with the previous
+year, but the value of imports increased by 47% compared with the previous year. The unit price of imported yachts reached a record high,
+reaching 75,300 US dollars per yacht.
+
+ 
+
+Marina
+and Yacht Club
+
+ 
+
+In
+terms of yacht marinas and clubs, the yacht industry is highly emphasized by many local governments as an emerging industry and that
+they have high hopes for and regard its development as a benchmark for urban success. According to CCYIA statistics, China currently
+has 149 yacht clubs, 93 of which are registered with the National Maritime Safety Department. There are 12,000 berths and 2,700 open-air
+berths on the land.
+
+ 
+
+Other
+advantages for the development of the yacht industry
+
+ 
+
+China
+has a total of 11,184 miles of coastline, 6,530 islands, 8,700 miles of island coastline, and many rivers and lakes. This provides vast
+natural resources for yacht development, and because southern China is not affected much by the seasonal climate, visitors are able to
+enjoy the unique geographical conditions the coast has to offer.
+
+ 
+
+Related
+Laws and Regulations of Ships in China
+
+ 
+
+In
+addition to the detailed requirements for the construction of traditional yachts, the Rules for Construction and Classification
+of Yachts 2020 adds new specifications for the company s electric yachts under development. Among them, the battery compartment
+is required to meet the fire protection requirements. This was taken into consideration from the start of the design process, and so
+the Company yacht meets this specification.
+
+ 48
+
+ 
+
+ 
+
+Article
+17 of the Foreign Investment Law of the People s Republic of China stipulates that foreign-invested enterprises may
+raise funds through public issuance of stocks, corporate bonds and other securities and other methods in accordance with the law. 
+Therefore, companies in China will be provided abundant financing channels. Article 10 stipulates that the state does not impose
+expropriation on the investment of foreign investors , which clarifies that the assets invested by companies in China are protected
+by law.
+
+ 
+
+According
+to the Provisions on Yacht Safety Management , yachts that have obtained a certificate in accordance with the yacht inspection
+regulations can sail freely; the requirements for yacht operators are not very strict. Yacht operators do not need to be professional
+crew members and do not need to follow the Crew Regulations For registration management, only the operating certificate is
+required. Yacht operators are different from operating ships in terms of training and examination subjects. In particular, they do not
+need to master the requirements of cargo stowage, etc. Such regulations are conducive to ordinary people driving yachts.
+
+ 
+
+Competition
+
+ 
+
+We
+face strong competition from well-established companies and small independent companies. We will be at a competitive disadvantage in
+obtaining the facilities, employees, financing, and other resources required to provide our services and products to customers. Our opportunity
+to obtain customers may be limited by our financial resources and other assets.
+
+ 
+
+MANAGEMENT S
+DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS BUSINESS
+
+ 
+
+Certain
+statements contained in this prospectus, including statements regarding the anticipated development and expansion of our business, our
+intent, belief, or current expectations, primarily with respect to the future operating performance of the Company and the products we
+expect to offer and other statements contained herein regarding matters that are not historical facts, are forward-looking 
+statements. Future filings with the Securities and Exchange Commission, future press releases and future oral or written statements made
+by us or with our approval, which are not statements of historical fact, may contain forward-looking statements, because such statements
+include risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements.
+
+ 
+
+All
+forward-looking statements speak only as of the date on which they are made. We undertake no obligation to update such statements to
+reflect events that occur or circumstances that exist after the date on which they are made. Our financial statements have been prepared
+assuming that we will continue as a going concern. To evaluate this assumption, the section below with the title of GOING CONCERN 
+should be reviewed carefully. Based on the assumption stated above, we have not included adjustments relating to the recoverability and
+realization of assets and classification of liabilities that might be necessary if we are not able to continue in operation.
+
+ 
+
+Our
+business has been impacted by the COVID-19 pandemic with the authority s implementation of various preventive measures including,
+but not limited to, travel bans and restrictions, mandatory quarantine requirements, limited business activities and operations, and
+shelter-in-place orders. These measures have led to, and are continuing to lead to, business slowdowns or shutdowns worldwide. The global
+economy and financial markets have been adversely influenced as well. Considering the features of our business in the tourism and recreation
+industries, the COVID-19 pandemic has caused a reduction in the demand for recreational trips and activities. Our business has been experiencing
+the downturn with the COVID-19 pandemic. It is expected that our business will be resumed, at least, after the abolition of the travel
+restrictions and mandatory quarantine requirements.
+
+ 
+
+RESULTS
+OF OPERATIONS
+
+ 
+
+RESULTS
+OF OPERATIONS
+
+ 
+
+Our
+consolidated financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include
+adjustments relating to the recovery ability and realization of assets and classification of liabilities that may be necessary should
+we be unable to continue our operations.
+
+ 49
+
+ 
+
+ 
+
+Comparison
+of Result of Operations for the Three and Nine Months Ended September 30, 2022 and 2021
+
+ 
+
+Our
+business has been impacted by the COVID-19 pandemic with the authority s implementation of various preventive measures including, but
+not limited to, travel bans and restrictions, mandatory quarantine requirements, limited business activities and operations, and shelter-in-place
+orders. These measures have led to, and are continuing to lead to, business slowdowns or shutdowns worldwide. The global economy and
+financial markets have been adversely influenced as well. Considering the features of our business in the tourism and recreation industries,
+the COVID-19 pandemic has caused a reduction in the demand for recreational trips and activities. Our business has been experiencing
+the downturn with the COVID-19 pandemic. It is expected that our business will be resumed, at least, after the abolition of the travel
+restrictions and mandatory quarantine requirements.
+
+ 
+
+RESULTS
+OF OPERATIONS
+
+ 
+
+Our
+financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments
+relating to the recover ability and realization of assets and classification of liabilities that might be necessary should we be unable
+to continue in operation.
+
+ 
+
+We
+generated net revenue of $25,479 and $109,957 for the three months ended September 30, 2022
+and 2021, respectively. We generated net revenue of $37,347 and $178,931 for the nine months ended September 30, 2022 and 2021, respectively.
+The decrease in net revenues was primarily because the revenue deriving from consulting services rendered on sales and marketing of yachts
+decreased.
+
+ 
+
+The
+cost of revenue incurred were $28,811 and $42,850 for the three months ended September 30,
+2022 and 2021, respectively. The cost of revenue incurred were $38,701 and $282,437 for the nine months ended September 30, 2022 and
+2021, respectively.
+
+ 
+
+The
+gross profits (loss) were $(3,332) and $67,107 for the three months ended September 30, 2022 and 2021, respectively. The gross profits(loss)
+were $(1,354) and $(103,506) for the nine months ended September 30, 2022 and 2021, respectively.
+
+ 
+
+The
+general and administrative expenses incurred were $283,016 and $321,310 for the three months
+ended September 30, 2022 and 2021, respectively. The general and administrative expenses incurred were $847,387 and $763,397
+for the nine months ended September 30, 2022 and 2021, respectively. The increase in general and administrative expenses was primarily
+attributable to an increase in staff salary and rent.
+
+ 
+
+Other
+income (expense) was $(1,965) and $(120,104) for the three months ended September 30, 2022 and 2021, respectively. Other income (expense)
+was $52,292 and $(1,325,447) for the nine months ended September 30, 2022 and 2021, respectively. Other income (expense) comprises of
+investment gain (loss), loss on loan settlement, interest expense, interest income and others. Investment gain (loss) was $59,206 and
+$(54,676) for the nine months ended September 30, 2022 and 2021, respectively. The investment gain (loss) in the nine months ended September
+30, 2022 and 2021 was primarily due to the investment gain (loss) in long-term investment. Loss on loan settlement was $0 and $170,355
+for the three months ended September 30, 2022 and 2021, respectively. Loss on loan settlement was $2,000 and $1,340,664 for the nine
+months ended September 30, 2022 and 2021, respectively.
+
+ 
+
+The
+net losses were $288,313 and $374,766 for the three months ended September 30, 2022 and 2021, respectively. The net losses were $796,458
+and $2,192,809 for the nine months ended September 30, 2022 and 2021, respectively. The main reason for the decreased losses was the
+decrease in loss on loan settlement.
+
+ 
+
+LIQUIDITY
+AND GOING CONCERN
+
+ 
+
+We
+had $57,817 cash and cash equivalents and working capital deficit of $1,165,695 as of September 30, 2022 and net loss of $796,458 during
+the nine months ended September 30, 2022. In addition, with respect to the ongoing and evolving COVID-19 outbreak, which was designated
+as a pandemic by the World Health Organization on March 11, 2020, the outbreak has caused substantial disruption in international economies
+and global trades and if repercussions of the outbreak are prolonged, could have a significant adverse impact on the Company s
+business.
+
+ 
+
+Cash
+Flows from Operating Activities
+
+ 
+
+The
+net cash used in operating activities were $72,639 and $812,861 for the nine months ended September 30, 2022 and 2021, respectively.
+For the nine months ended September 30, 2022, the most affected the net cash provided by operating activities were the deferred revenue
+$1,259,391 and accounts payable $606,103, offset by the inventory of $1,296,663. For
+
+ 50
+
+ 
+
+ 
+
+nine months ended September 30, 2021, the most affected
+the net cash used in operating activities were the net loss $2,192,809, offset by the loss on loan settlement $1,340,664.
+
+ 
+
+Cash
+Flows from Investing Activities
+
+ 
+
+The
+net cash provided by (used in) investing activities were $58,523 and $(383,447) for the nine months ended September 30, 2022 and 2021,
+respectively. The change is primarily due to the investment and disposal of Ocean Way for the nine months ended September 30, 2022.
+
+ 
+
+Cash
+Flows from Financing Activities
+
+ 
+
+The
+net cash used in (provided by) financing activities were $(61,228) for the nine months ended September 30, 2022 and $740,936 for the
+nine months ended September 30, 2021. For the nine months ended September 30, 2022, the cash used in financing activities were repayment
+of related party $111,228 and the cash generated from financing activities included proceeds from loans $50,000. For
+the nine months ended September 30, 2021, the cash used in financing activities were repayment of related party $341,019 and the cash
+generated from financing activities included proceeds from loans $1,081,955.
+
+ 
+
+Going
+Concern
+
+ 
+
+The
+unaudited condensed consolidated financial statements have been prepared assuming that we will continue as a going concern, 
+which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.
+
+ 
+
+For
+the nine months ended September 30, 2022, we have not established a recurring source of revenue to sufficiently cover its operating costs
+in the next twelve months. These factors raise substantial doubt about our ability to continue as a going concern. Our ability to continue
+as a going concern is dependent on our ability to raise additional capital and implement business and expansion plans. These consolidated
+financial statements do not include any adjustments to the recover ability and classification of recorded asset amounts and classification
+of liabilities that might be necessary should we be unable to continue as a going concern.
+
+ 
+
+Our
+management believes that the current actions to obtain additional funding and implement our strategic plans provide the opportunity for
+us to continue as a going concern. There are no assurances that additional funds will be available when needed from any source or, if
+available, will be available on terms that are acceptable to us.
+
+ 
+
+PLAN
+OF OPERATION AND FUNDING
+
+ 
+
+We
+expect that working capital requirements will continue to be funded through a combination of our existing funds and further issuance
+of securities. Our working capital requirements are expected to increase in line with the growth of our business.
+
+ 
+
+Existing
+working capital, further advances and debt instruments, and anticipated cash flow are expected to be adequate to fund our operations
+over the next six months. We have no lines of credit or other bank financing arrangements. Generally, we have financed operations to
+date through the proceeds of the private placement of equity and debt instruments. In connection with our business plan, management anticipates
+additional increases in operating expenses and capital expenditures relating to: (i) developmental expenses associated with business
+and (ii) marketing expenses. We intend to finance these expenses with further issuance of securities, and debt issuance. Thereafter,
+we expect we will need to raise additional capital and generate revenues to meet long- term operating requirements. Additional issuances
+of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights,
+preferences or privileges senior to our common shares. Additional financing may not be available upon acceptable terms, or at all. If
+adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business
+endeavors or opportunities, which could significantly and materially restrict our business operations.
+
+ 
+
+MATERIAL
+COMMITMENTS
+
+ 
+
+As
+of the date of this Report, we do not have any material commitments.
+
+ 51
+
+ 
+
+ 
+
+OFF-BALANCE
+SHEET ARRANGEMENTS
+
+ 
+
+As
+of the date of this Report, there are no such arrangements. We do not have any off-balance sheet arrangements that have or are reasonably
+likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of
+operations, liquidity, capital expenditures or capital resources that are material to investors.
+
+ 
+
+Comparison
+of Result of Operations for the Years Ended December 31, 2021 and 2020
+
+ 
+
+We
+generated net revenues of $244,191 and $243,508 for years ended December 31, 2021 and 2020, respectively. The increase in net revenues
+was primarily because the revenue deriving from consulting services rendered on sales and marketing of yachts increased.
+
+ 
+
+The
+cost of revenue incurred were $366,852 and $3,913 for years ended December 31, 2021 and
+2020, respectively.
+
+ 
+
+The
+gross profits were $(122,661) and $239,595 for the years ended December 31, 2021 and 2020, respectively. The falling gross profit in
+2021 was essentially caused by the COVID-19 pandemic, which unfavorably influenced our consulting service fee on sales and marketing
+of yachts.
+
+ 
+
+The
+general and administrative expenses incurred were $1,263,691 and $1,261,761 for years ended December 31, 2021 and 2020, respectively.
+General and administrative expenses were basically the business expenses and corporate overhead.
+
+ 
+
+Impairment
+loss was $87,414 and $0 for year ended December 31, 2021 and 2020, respectively. The impairment loss in 2021 was primarily due to the
+impairment loss on goodwill.
+
+ 
+
+Other
+income was $176,189 and $35,909 for year ended December 31, 2021 and 2020, respectively. The increase in other income was primarily because
+the increase in subsidy income.
+
+ 
+
+The
+net loss was $2,662,829 and $987,524 for the years ended December 31, 2021 and 2020, respectively. The main reason for the increased
+loss was the $1,340,664 loss on loan settlement for the year ended December 31, 2021.
+
+ 
+
+LIQUIDITY
+AND GOING CONCERN
+
+ 
+
+The
+Company has suffered from net loss of $2,662,829 during the year ended December 31, 2021. Also, at December 31, 2021, the Company has
+incurred the accumulated deficit of $3,865,450 and working capital deficit of $499,399. As of December 31, 2021, the Company had approximately
+$80,306 of cash and cash equivalents. In addition, with respect to the ongoing and evolving COVID-19 outbreak, which was designated as
+a pandemic by the World Health Organization on March 11, 2020, the outbreak has caused substantial disruption in international economies
+and global trades and if repercussions of the outbreak are prolonged, could have a significant adverse impact on the Company s
+business.
+
+ 
+
+Cash
+Flows from Operating Activities
+
+ 
+
+The
+net cash used in operating activities were $(967,216) and $(1,343,316) for the years ended December 31, 2021 and 2020, respectively.
+For year ended December 31, 2021, the most affected the net cash used in operating activities were the net loss $2,662,829 offset by
+the loss on loan settlement of $1,340,664 and increase in receipt in advance $204,442. For the year ended December 31, 2020, the cash
+used in operating activities for year ended December 31, 2020 mostly were changes in deposits and prepayments $77,213, other receivable
+$30,362, accrued liabilities and other payable $235,871, deferred revenue $36,841 and income tax payable $6,388.
+
+ 
+
+Cash
+Flows from Investing Activities
+
+ 
+
+The
+net cash used in investing activities were $350,297 and $2,921 for the years ended December 31, 2021 and 2020, respectively. The change
+is primarily attributable to an increase in cash used in acquisition of subsidiary and purchase of property, plant and equipment for
+the year ended December 31, 2021.
+
+ 
+
+Cash
+Flows from Financing Activities
+
+ 
+
+The
+net cash provided by financing activities were $920,901 for the years ended December 31, 2021 and $1,302,101 for the year ended December
+31, 2020. The net cash provided for these two periods was mostly attributed from the cash proceeds from loans and issuance of common
+shares. For the year ended December 31, 2021, the cash used in financing activities were repayment of related party $161,053 and the
+cash generated from financing activities included proceeds from loans
+
+ 52
+
+ 
+
+ 
+
+$1,081,954. For the year ended December 31, 2020, the cash used
+in financing activities were repayment to related parties $93,715 and repayment of lease liability $7,032 and the cash generated from
+financing activities included proceed from issuance of common shares $1,308,316 and proceeds from promissory note $87,500, which was
+the COVID-19 economic injury disaster loan and offered by The U.S. Small Business Administration.
+
+ 
+
+Going
+Concern
+
+ 
+
+The
+independent auditors report accompanying our financial statements contain a note expressing substantial doubt about our ability to continue
+as a going concern. The consolidated financial statements have been prepared assuming that we will continue as a going concern, 
+which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.
+
+ 
+
+For
+the year ended December 31, 2021, we have not established a recurring source of revenue to sufficiently cover its operating costs in
+the next twelve months. These factors raise substantial doubt about our ability to continue as a going concern. Our ability to continue
+as a going concern is dependent on our ability to raise additional capital and implement business and expansion plans. These consolidated
+financial statements do not include any adjustments to the recover ability and classification of recorded asset amounts and classification
+of liabilities that might be necessary should we be unable to continue as a going concern.
+
+ 
+
+Our
+management believes that the current actions to obtain additional funding and implement our strategic plans provide the opportunity for
+us to continue as a going concern. There are no assurances that additional funds will be available when needed from any source or, if
+available, will be available on terms that are acceptable to us.
+
+ 
+
+PLAN
+OF OPERATIONS AND FUNDING
+
+ 
+
+We
+expect that our working capital requirement will continue to be funded through a combination of our existing funds and further
+issuance of securities. Our working capital requirements are expected to increase in line with the growth of our business. Existing
+working capital, further advances and debt instruments, and anticipated cash flows are expected to be adequate to fund our
+operations through the next six months to nine months. We have no lines of credit or other bank financing arrangements. Generally,
+we have financed operations to date through the proceeds of the private placement of equity and debt instruments. In connection with
+our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to: (i)
+developmental expenses associated with business and (ii) marketing expenses( ) development and commercialization of
+all-electric boat business. We intend to finance these expenses with further issuance of securities, and debt issuance. Therefore,
+we expect we will need to raise additional capital and generate revenues to meet long- term operating requirements. Additional
+issuance of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities
+might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable
+terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage
+of prospective business endeavors or opportunities, which could significantly and materially restrict our business
+operations.
+
+ 
+
+MATERIAL
+COMMITMENTS
+
+ 
+
+As
+of the date of this, we do not have any material commitments.
+
+ 
+
+OFF-BALANCE
+SHEET ARRANGEMENTS
+
+ 
+
+We
+do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial
+condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources
+that are material to investors.
+
+ 
+
+SIGNIFICANT
+ACCOUNTING POLICIES
+
+ 
+
+The
+accompanying consolidated financial statements reflect the application of certain significant accounting policies as described in this
+note and elsewhere in the consolidated financial statements and the accompanying notes.
+
+ 
+
+ Use
+ of estimates
+
+ 53
+
+ 
+
+ 
+
+In
+preparing these consolidated financial statements, management makes estimates and assumptions that affect the reported amounts of assets
+and liabilities in the balance sheet and revenues and expenses during the periods reported. Actual results may differ from these estimates.
+
+ 
+
+ Risks
+ and Uncertainties
+
+ 
+
+(1)The
+ Company s auditors have issued a going concern opinion. This means that there is substantial
+ doubt that the Company can continue as an ongoing business for the next twelve months if
+ the Company does not generate more revenues or obtain more funds for its business operations.
+ There is no assurance that the Company can generate more revenues or obtain more investments.
+ The Company has been funded by the major shareholder to continue business operations which
+ is the most major factor to keep the company operates, until other investments can be received
+ by the Company.
+
+ 
+
+(2)The
+ Company faces strong competition from well-established companies and small independent companies.
+ The Company will be at a competitive disadvantage in obtaining the facilities, employees,
+ financing and other resources required to provide its services and products to customers.
+ The Company s opportunity to obtain customers may be limited by its financial resources
+ and other assets.
+
+ 
+
+(3)The
+ Company relies on the health and growth of the tourism industry. Tourism is highly sensitive
+ to business and personal discretionary spending levels, and thus tends to decline during
+ general economic downturns. In addition, other adverse trends or events that tend to reduce
+ tourism are likely to reduce our revenues. Also, due to the nature of its business, the Company
+ may be subject to liability claims arising out of accidents or disasters causing injury to
+ its customers, including claims for serious personal injury or death. There can be no assurance
+ that the Company will be able to obtain sufficient insurance coverage at acceptable premium
+ levels in the future. Successful assertion against one or a series of large uninsured claims,
+ or of one or a series of claims exceeding our insurance, could adversely affect its business,
+ financial condition and results of operations.
+
+ 
+
+(4)The
+ Company has a trademark in China and will continue the process of applying trademarks in
+ Taiwan and US. There is no assurance that the trademark registration can be obtained timely.
+
+ 
+
+(5)The
+ Company is unable to afford establishing an audit committee due to limited operations and
+ lack of revenue.
+
+ 
+
+(6)As
+ a Nevada corporation, the Company plans to be able to carry out business in the United States
+ eventually. However, currently we don t have any substantial asset in the U.S. and
+ we may not be able to own any substantial asset in the near future. Lack of substantial assets
+ will make it difficult for us to launch business operations and cause delay to the execution
+ of our business plans in the U.S.
+
+ 
+
+(7)The
+ Company has not used a private placement memorandum, a registered stock offering or any other
+ type of formal disclosure connected with prior sales of securities. Therefore, there is risk
+ that investors might seek to reverse prior purchase transactions and ask for a return of
+ their money.
+
+ 
+
+ Basis
+ of consolidation
+
+ 
+
+The
+consolidated financial statements include the financial statements of Vivic Corp. and its subsidiaries. All significant inter-company
+balances and transactions within the Company have been eliminated upon consolidation.
+
+ 
+
+ Cash
+ and cash equivalents
+
+ 
+
+Cash
+and cash equivalents consist primarily of cash in readily available checking and saving accounts. Cash equivalents consist of highly
+liquid investments that are readily convertible to cash and that mature within three months or less from the date of purchase. The carrying
+amounts approximate fair value due to the short maturities of these instruments.
+
+ 
+
+ Accounts
+ receivable 
+
+ 
+
+Accounts
+receivable are recorded at the invoiced amount and do not bear interest, which are due within contractual payment terms, generally 30
+to 90 days from completion of service. Credit is extended based on evaluation of a customer s financial condition, the customer
+credit-worthiness and their payment history. Accounts receivable outstanding longer than the contractual payment terms are considered
+past due. Past due balances over 90 days and over a specified amount are reviewed individually for collectability. At the end of fiscal
+year, the Company specifically evaluates individual customer s financial condition, credit history, and the
+
+ 54
+
+ 
+
+ 
+
+current economic conditions
+to monitor the progress of the collection of accounts receivables. The Company will consider the allowance for doubtful accounts for
+any estimated losses resulting from the inability of its customers to make required payments. For the receivables that are past due or
+not being paid according to payment terms, the appropriate actions are taken to exhaust all means of collection, including seeking legal
+resolution in a court of law. Account balances are charged off against the allowance after all means of collection have been exhausted
+and the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its customers.
+As of September 30, 2022 and December 31, 2021, the Company recorded $829 and $0 allowance for
+doubtful accounts, respectively.
+
+ 
+
+ Property,
+ plant and equipment
+
+ 
+
+Property,
+plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated
+on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking
+into account their estimated residual values:
+
+ 
+
+ 
+ 
+ Expected useful life
+
+ 
+ Service yacht 
+ 10 years
+
+ 
+ Motor vehicle 
+ 5 years
+
+ 
+ Office equipment 
+ 5 years
+
+ 
+
+ 
+
+Expenditure
+for repairs and maintenance is expensed as incurred. When assets have retired or sold, the cost and related accumulated depreciation
+are removed from the accounts and any resulting gain or loss is recognized in the results of operations.
+
+ 
+
+ Revenue
+ recognition
+
+ 
+
+In
+accordance with ASC Topic 606, Revenue from Contracts with Customers , the Company recognizes revenues when goods or services
+are transferred to customers in an amount that reflects the consideration which the Company expects to receive in exchange for those
+goods or services. In determining when and how revenues are recognized from contracts with customers, the Company performs the following
+five-step analysis: (i) identification of contract with customer (ii) determination of performance obligations (iii) measurement
+of the transaction price (iv) allocation of the transaction price to the performance obligations, and (v) recognition of revenues
+when (or as) the Company satisfies each performance obligation. The Company derives revenues from the processing, distribution, and sale
+of its products.
+
+ 
+
+ Comprehensive
+ income
+
+ 
+
+ASC
+Topic 220, Comprehensive Income , establishes standards for reporting and display of comprehensive income, its components,
+and accumulated balances. Comprehensive income as defined includes all changes in equity during a period from non-owner sources. Accumulated
+other comprehensive income, as presented in the accompanying consolidated statements of stockholders equity (deficit), consists
+of changes in unrealized gains and losses on foreign currency translation. This comprehensive income is not included in the computation
+of income tax expense or benefit.
+
+ 
+
+ Income
+ taxes
+
+ 
+
+Income
+taxes are determined in accordance with the provisions of ASC Topic 740, Income Taxes ( ASC 740 ). Under
+this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the
+financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities
+are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are
+expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income
+in the period that includes the enactment date.
+
+ 
+
+ASC
+740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements
+uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the
+financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax
+positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of
+being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.
+
+ 
+
+The
+Company is subject to tax in local and foreign jurisdiction. As a result of its business activities, the Company files tax returns that
+are subject to examination by the relevant tax authorities.
+
+ 
+
+ Foreign
+ currencies translation
+
+ 55
+
+ 
+
+ 
+
+Transactions
+denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing
+at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated
+into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded
+in the statements of operations.
+
+ 
+
+The
+reporting currency of the Company is United States Dollar ( US$ ) and the accompanying consolidated financial statements have
+been expressed in US$. In addition, the Company and subsidiaries are operating in PRC and Hong Kong maintain their books and record in
+their local currency, Renminbi ( RMB ) and Hong Kong dollars ( HK$ ), which is a functional currency as being
+the primary currency of the economic environment in which their operations are conducted. In general, for consolidation purposes, assets,
+and liabilities of its subsidiaries whose functional currency is not US$ are translated into US$, in accordance with ASC Topic 830-30,
+ Translation of Financial Statement , using the exchange rate on the balance sheet date. Revenues and expenses are
+translated at average rates prevailing during the year. The gains and losses resulting from translation of financial statements of foreign
+subsidiaries are recorded as a separate component of accumulated other comprehensive income within the statements of changes in stockholder s
+equity (deficit).
+
+ 
+
+Translation
+of amounts from RMB and HK$ into US$ has been made at the following exchange rates for the periods ended September 30, 2022 and December
+31, 2021:
+
+ 
+
+ 
+ 
+ September 30, 2022 
+ December 31, 2021 
+
+ 
+ Period/year-end RMB:US$ exchange rate 
+ 7.1128 
+ 6.3588 
+
+ 
+ Period/annual average RMB:US$ exchange rate 
+ 6.6023 
+ 6.4499 
+
+ 
+ Period/year-end HK$:US$ exchange rate 
+ 7.8499 
+ 7.7971 
+
+ 
+ Period/annual average HK$:US$ exchange rate 
+ 7.8332 
+ 7.7723 
+
+ 
+ Period/year-end TWD:US$ exchange rate 
+ 31.7843 
+ 27.6879 
+
+ 
+ Period/annual average TWD:US$ exchange rate 
+ 29.2791 
+ 27.9194 
+
+ 
+
+ 
+
+ Lease
+
+ 
+
+At
+the inception of an arrangement, the Company determines whether the arrangement is or contains a lease based on the unique facts and
+circumstances present. Leases with a term greater than one year are recognized on the balance sheet as right-of-use assets, lease liabilities
+and long-term lease liabilities. The Company has elected not to recognize on the balance sheet leases with terms of one year or less.
+Operating lease liabilities and their corresponding right-of-use assets are recorded based on the present value of lease payments over
+the expected remaining lease term. However, certain adjustments to the right-of-use asset may be required for items such as prepaid or
+accrued lease payments. The interest rate implicit in lease contracts is typically not readily determinable. As a result, the Company
+utilizes its incremental borrowing rates, which are the rates incurred to borrow on a collateralized basis over a similar term an amount
+equal to the lease payments in a similar economic environment.
+
+ 
+
+In
+accordance with the guidance in ASC 842, components of a lease should be split into three categories: lease components (e.g., land, building,
+etc.), non-lease components (e.g., common area maintenance, consumables, etc.), and non-components (e.g., property taxes, insurance,
+etc.). Subsequently, the fixed and in-substance fixed contract consideration (including any related to non-components) must be allocated
+based on the respective relative fair values to the lease components and non-lease components.
+
+ 
+
+The
+Company made the policy election to not separate lease and non-lease components. Each lease component and the related non-lease components
+are accounted for together as a single component.
+
+ 
+
+ Noncontrolling
+ interest
+
+ 
+
+The
+Company accounts for noncontrolling interest in accordance with ASC Topic 810-10-45, which requires the Company to present noncontrolling
+interests as a separate component of total shareholders equity on the consolidated balance sheets and the consolidated net loss
+attributable to the its noncontrolling interest be clearly identified and presented on the face of the consolidated statements of operations
+and comprehensive loss.
+
+ 
+
+ Net
+ loss per share
+
+ 56
+
+ 
+
+ 
+
+The
+Company calculates net loss per share in accordance with ASC Topic 260, Earnings per Share. Basic income per share
+is computed by dividing the net income by the weighted-average number of common shares outstanding during the period. Diluted income
+per share is computed similar to basic income per share except that the denominator is increased to include the number of additional
+common shares that would have been outstanding if the potential common shares equivalents had been issued and if the additional common
+shares were dilutive.
+
+ 
+
+ Related
+ parties
+
+ 
+
+Parties,
+which can be a corporation or individual, are considered to be related if the Company has the ability, directly or indirectly, to control
+the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also
+considered to be related if they are subject to common control or common significant influence.
+
+ 
+
+ Concentrations
+ and credit risk
+
+ 
+
+The
+Company s principal financial instruments subject to potential concentration of credit risk are cash and cash equivalents, including
+amounts held in money market accounts. The Company places cash deposits with a federally insured financial institution. The Company maintains
+its cash at banks and financial institutions it considers to be of high credit quality; however, the Company s domestic cash deposits
+may at times exceed the Federal Deposit Insurance Corporation s insured limit. Balances in excess of federally insured limitations
+may not be insured. The Company has not experienced losses on these accounts, and management believes that the Company is not exposed
+to significant risks on such accounts.
+
+ 
+
+ Fair
+ value of financial instruments
+
+ 
+
+The
+carrying value of the Company s financial instruments (excluding short-term bank borrowing and note payable): cash and cash equivalents,
+accounts receivable, prepayments and other receivables, accounts payable, income tax payable, amount due to a related party, other payables
+and accrued liabilities approximate at their fair values because of the short-term nature of these financial instruments.
+
+ 
+
+Management
+believes, based on the current market prices or interest rates for similar debt instruments, the fair value of note payable approximate
+the carrying amount.
+
+ 
+
+The
+Company also follows the guidance of the ASC Topic 820-10, Fair Value Measurements and Disclosures ( ASC 820-10 ),
+with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a three-tier fair value hierarchy
+that prioritizes the inputs used in measuring fair value as follows:
+
+ 
+
+ 
+ 
+ Level
+ 1 : Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets;
+
+ 
+ 
+
+ 
+ 
+ Level
+ 2 : Inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments
+ in markets that are not active, and
+
+ 
+ 
+
+ 
+ 
+ Level
+ 3 : Inputs are generally unobservable and typically reflect management s estimates of assumptions that market participants
+ would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option
+ pricing models and discounted cash flow models.
+
+ 
+ 
+
+Fair
+value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates
+are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision.
+Changes in assumptions could significantly affect the estimates.
+
+ 
+
+ Recent
+ accounting pronouncements
+
+ 
+
+In
+April 2019, the FASB issued ASU No. 2019-04, Codification Improvements to Topic 326, Financial Instruments - Credit Losses,
+Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments ( ASU 2019-04 ) which clarifies treatment
+of certain credit losses. In May 2019, the FASB issued ASU No. 2019-05, Financial Instruments - Credit Losses (Topic 326):
+Targeted Transition Relief ( ASU 2019-05 ) which provides an option to irrevocably elect to measure certain individual
+financial assets at fair value instead of amortized cost. In November 2019, the FASB issued ASU No. 2019-11, Codification
+Improvements to Topic 326, Financial Instruments - Credit Losses ( ASU 2019-11 ), which provides guidance around
+how to report expected recoveries. In February 2020, the Financial Accounting Standards Board issued ASU No. 2020-02, Financial
+Instruments - Credit Losses (Topic 326) ( ASU 2020-02 ) which provides updated
+
+ 57
+
+ 
+
+ 
+
+guidance on how an entity should
+measure credit losses on financial instruments and delayed the effective date of the original pronouncement for smaller reporting companies.
+ASU 2016-13, ASU 2018-19, ASU 2019-04, ASU 2019-05, ASU 2019-11 and ASU 2020-02 (collectively, ASC 326 ) are effective
+for public entities for fiscal years beginning after December 15, 2019, with early adoption permitted. The adoption of ASC 326 did not
+have a material impact on the Company s recognition of financial instruments within the scope of the standard.
+
+ 
+
+In
+December 2019, the FASB issued ASU No 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes 
+( ASU 2019-12 ). ASU 2019-12 removes certain exceptions to the general principles in Topic 740 in Generally Accepted Accounting
+Principles. ASU 2019-12 is effective for public entities for fiscal years beginning after December 15, 2020, with early adoption permitted.
+The Company does not expect ASU 2019-12 to have a material effect on the Company s current financial position, results of operations
+or financial statement disclosures.
+
+ 
+
+In
+March 2020, the FASB issued ASU 2020-03, Codification Improvements to Financial Instruments ( ASU 2020-03 ).
+ASU 2020-03 improves and clarifies various financial instruments topics. ASU 2020-03 includes seven different issues that describe the
+areas of improvement and the related amendments to GAAP, intended to make the standards easier to understand and apply by eliminating
+inconsistencies and providing clarifications. The Company adopted ASU 2020-03 upon issuance, which did not have a material effect on
+the Company s current financial position, results of operations or financial statement disclosures. In March 2020, the FASB issued
+ASU No 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting 
+( ASU 2020-04 ). ASU 2020-04 provides temporary optional expedients and exceptions to the US GAAP guidance on contract modifications
+and hedge accounting to ease the financial reporting burdens related to the expected market transition from the London Interbank Offered
+Rate (LIBOR) and other interbank offered rates to alternative reference rates. ASU 2020-04 is effective beginning on March 12, 2020,
+and the Company may elect to apply the amendments prospectively through December 31, 2022. The Company does not expect ASU 2020-04 to
+have a material effect on the Company s current financial position, results of operations or financial statement disclosures.
+
+ 
+
+The
+Company has reviewed all the recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption
+of any such pronouncements may cause material impacts on its financial conditions or the results of its operations.
+
+ 
+
+DIRECTOR
+AND OFFICER LIABILITY AND INDEMNIFICATION
+
+ 
+
+Director
+Liability
+
+ 
+
+Our
+certificate of incorporation provides that no director shall be personally liable to us or any of our stockholders for monetary damages
+resulting from breaches of their fiduciary duty as directors, except to the extent such limitation on or exemption from liability is
+not permitted under Nevada law. The effect of this provision of our certificate of incorporation is to eliminate our rights and those
+of our stockholders (through stockholders derivative suits on our behalf) to recover monetary damages against a director for breach
+of the fiduciary duty of care as a director, including breaches resulting from negligent or grossly negligent behavior, except, as restricted
+by Nevada law:
+
+ 
+
+ for
+any breach of the director s duty of loyalty to we or its stockholders;
+
+ 
+
+ for
+acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law;
+
+ 
+
+ in
+respect of certain unlawful dividend payments or stock redemptions or repurchases; and
+
+ 
+
+ for
+any transaction from which the director derives an improper personal benefit.
+
+ 
+
+This
+provision does not limit or eliminate our rights or the rights of any stockholder to seek non-monetary relief, such as an injunction
+or rescission, in the event of a breach of a director s duty of care.
+
+ 
+
+If
+Nevada law is amended to authorize corporate action further eliminating or limiting the liability of directors, then, in accordance with
+our certificate of incorporation, the liability of our directors to us or our stockholders will be eliminated or limited to the fullest
+extent authorized by Nevada law, as so amended. Any repeal or amendment of provisions of our certificate of incorporation limiting or
+eliminating the liability of directors, whether by our stockholders or by changes in law, or the adoption of any other provisions inconsistent
+therewith, will (unless otherwise required by law) be prospective only, except to the extent such amendment or change in law permits
+us to further limit or eliminate the liability of directors on a retroactive basis.
+
+ 
+
+Our
+certificate of incorporation provides that we will, to the fullest extent authorized or permitted by applicable law, indemnify our current
+and former directors and officers, as well as those persons who, while directors or officers of our corporation, are or were serving
+as directors, officers, employees or agents of another entity, trust or other enterprise, including service with respect to an employee
+benefit plan, in connection with any threatened, pending or completed proceeding, whether civil, criminal, administrative or investigative,
+against all expense, liability and loss (including, without limitation, attorney s fees, judgments, fines, ERISA excise taxes and
+penalties and amounts paid in settlement) reasonably incurred or suffered by any such person in connection with any such proceeding.
+Notwithstanding the foregoing, a person eligible for indemnification pursuant to our
+
+ 58
+
+ 
+
+ 
+
+certificate of incorporation will be indemnified
+by us in connection with a proceeding initiated by such person only if such proceeding was authorized by our board of directors, except
+for proceedings to enforce rights to indemnification.
+
+ 
+
+The
+right to indemnification conferred by our certificate of incorporation is a contract right that includes the right to be paid by us the
+expenses incurred in defending or otherwise participating in any proceeding referenced above in advance of its final disposition, provided,
+however, that if the Nevada law requires, an advancement of expenses incurred by our officer or director (solely in the capacity as an
+officer or director of our corporation) will be made only upon delivery to us of an undertaking, by or on behalf of such officer or director,
+to repay all amounts so advanced if it is ultimately determined that such person is not entitled to be indemnified for such expenses
+under our certificate of incorporation or otherwise.
+
+ 
+
+The
+rights to indemnification and advancement of expenses will not be deemed exclusive of any other rights which any person covered by our
+certificate of incorporation may have or hereafter acquire under law, our certificate of incorporation, our bylaws, an agreement, vote
+of stockholders or disinterested directors, or otherwise.
+
+ 
+
+Any
+repeal or amendment of provisions of our certificate of incorporation affecting indemnification rights, whether by our stockholders or
+by changes in law, or the adoption of any other provisions inconsistent therewith, will (unless otherwise required by law) be prospective
+only, except to the extent such amendment or change in law permits us to provide broader indemnification rights on a retroactive basis,
+and will not in any way diminish or adversely affect any right or protection existing at the time of such repeal or amendment or adoption
+of such inconsistent provision with respect to any act or omission occurring prior to such repeal or amendment or adoption of such inconsistent
+provision. Our certificate of incorporation also permits us, to the extent and in the manner authorized or permitted by law, to indemnify
+and to advance expenses to persons other than those specifically covered by our certificate of incorporation.
+
+ 
+
+Our
+bylaws include the provisions relating to advancement of expenses and indemnification rights consistent with those set forth in our certificate
+of incorporation. In addition, our bylaws provide for a right of indemnity to bring a suit in the event a claim for indemnification or
+advancement of expenses is not paid in full by us within a specified period of time. Our bylaws also permit us to purchase and maintain
+insurance, at our expense, to protect us and/or any director, officer, employee or agent of our corporation or another entity, trust
+or other enterprise against any expense, liability or loss, whether or not we would have the power to indemnify such person against such
+expense, liability or loss under Nevada law. Any repeal or amendment of provisions of our bylaws affecting indemnification rights, whether
+by our board of directors, stockholders or by changes in applicable law, or the adoption of any other provisions inconsistent therewith,
+will (unless otherwise required by law) be prospective only, except to the extent such amendment or change in law permits us to provide
+broader indemnification rights on a retroactive basis, and will not in any way diminish or adversely affect any right or protection existing
+thereunder with respect to any act or omission occurring prior to such repeal or amendment or adoption of such inconsistent provision.
+
+ 
+
+Listing
+
+ 
+
+Our
+common shares are listed for quotation on The OTCQB Venture Market board at OTC Markets
+under the symbol VIVC 
+
+ 
+
+MANAGEMENT
+
+ 
+
+Executive
+officers and directors of the company
+
+ 
+
+Shang-Chiai
+Kung, Chief Executive Officer, President, Chairman of the board, age 82. He was the founder and director of Kha Shing Enterprise
+Company Ltd. from 1977 to 1997. He was also the founder and director of Horizon Yacht Co., Ltd. from 1987 to 1997. He was the Consultant
+of Jian Yu Materials Industry Co., Ltd. from 2011 to Aug 2020. He was the legal representative of Jiexing Agriculture Technology Co.
+Ltd. since April 2013 to 2020. He was the Consultant of Jie Xin Investment Co., Ltd. from June 2018 to August 2020.
+
+ 
+
+Kun-Teng
+Liao, Secretary and Board Director, 54 years old, is a resident of Taiwan. He received an MBA degree from Seton Hall University,
+New Jersey, US, in 2013. From 2006 to 2016, he was the chairman of EcallBuy Trading Company Limited. He is Executive Director and General
+Manager of the subsidiary company, Guangzhou Hysoul Yacht Company Ltd. since May, 2019. He is also Executive Director and General Manager
+of subsidiary, Zhejiang Jiaxu Yacht Company Ltd. since July 2021.
+
+ 
+
+Yu-Han
+Chen, Board Director, 55 years old, is a resident of US. He received a bachelor degree from Pepperdine University, California,
+US, in 1987. He was an Executive Director of Norseman International Co., from 2004 till 2021. He is General Manager in Product Design
+and Development of the subsidiary company, Vivic Guangdong Corporation Limited. since May, 2021 till now.
+
+ 
+
+The
+term for each executive officer and director is one year and can be renewed, unless they resign or are forced to leave due to special
+circumstance. The current officers and directors provide free services and there is no employment agreement.
+
+ 59
+
+ 
+
+ 
+
+EXECUTIVE
+OFFICER AND DIRECTOR COMPENSATION
+
+ 
+
+After
+the change of management in December 2018, we have not paid any monetary compensation to our officers and directors.
+
+ 
+
+SECURITY
+OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
+
+ 
+
+The
+following table sets forth information as of August 15 2022 regarding the ownership of our common shares by each shareholder known by
+us to be the beneficial owner of more than five percent of our outstanding shares of common shares, each director and all executive officers
+and directors as a group. Except as otherwise indicated, each of the shareholders has sole voting and investment power with respect to
+the shares of common shares beneficially owned.
+
+ 
+
+ 
+ Officers/Directors
+ 
+ Address
+ 
+ No.
+ of
+
+Shares
+ 
+ Percentage
+
+ 
+ Kun-Teng
+ Liao (Secretary and Board Director)
+ 
+ No.
+ 15 Chen Yu Rd., Changhua, Taiwan 50020
+ 
+ 24,000
+ 
+ 
+ 0.09%
+
+ 
+ 
+ 
+ Officers
+ and Directors as Total
+ 
+ 24,000
+ 
+ 
+ 0.09%
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 5%
+ and above shareholder
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Cheng-Lung
+ Soong
+ 
+ 10F,
+ No. 59, Ln. 112, Jihu Rd., Zhongshan Dist. Taipei, Taiwan
+ 
+ 2,039,000
+ 
+ 
+ 7.98%
+
+ 
+ Go
+ Right Holdings Ltd.
+ 
+ No.
+ 7, Aly 1, Ln. 143, Sec. 2, Lin-An Rd., N. Dist. Tainan, Taiwan
+ 
+ 5,624,800
+ 
+ 
+ 22.02%
+
+ 
+ Yun-Kuang
+ Kung
+ 
+ No.
+ 12- 1, Xiaoximen, Neighborhood, 14m, Zhusha Village, Jincheng Township, Kinmen, Fuchien, Taiwan
+ 
+ 3,221,886
+ 
+ 
+ 12.61%
+
+ 
+ Liu-Shiang
+ Kung Hwang
+ 
+ No.
+ 7, Aly 1, Ln. 143, Sec. 2, Lin-An Rd., N. Dist. Tainan, Taiwan
+ 
+ 1,875,562
+ 
+ 
+ 7.34%
+
+ 
+ Kun-Horng
+ Tsai
+ 
+ 3F,
+ No. 66, Ln. 133, Dongfeng Rd., N. Dist. Tainan, Taiwan
+ 
+ 1,784,000
+ 
+ 
+ 6.98%
+
+ 
+ Huilan
+ Chen
+ 
+ 1091
+ Rising Moon Trail, Snellville, GA. 30078
+ 
+ 1,589,686
+ 
+ 
+ 6.22%
+
+ 
+ Miao-Chuan
+ Ho
+ 
+ No.
+ 22, Ln. 480 Wenxian Rd., N. Dist. Tainan, Taiwan
+ 
+ 1,455,000
+ 
+ 
+ 5.70%
+
+ 
+ 
+ 
+ 5%
+ and above shareholder as Total
+ 
+ 17,589,934
+ 
+ 
+ 68.85%
+
+ 
+ 
+
+(1)The
+percentages below are based on 25,546,810 shares of our common shares issued and outstanding as of September 30, 2022.
+
+ 
+
+MAJOR
+SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
+
+ 
+
+Policies
+and Procedures for Related Party Transactions
+
+ 
+
+Our
+board of directors recognizes that transactions with related parties can present potential or actual conflicts of interest and may raise
+questions as to whether those transactions are consistent with our best interests and the best interests of our stockholders. Therefore,
+our board of directors has adopted a written policy on transactions with any related party, which is defined as any director, executive
+officer, nominee for director, any beneficial owner of more than 5% of any class of our capital stock, and any of their immediate family
+members.
+
+ 60
+
+ 
+
+ 
+
+Under
+the policy, a related party must promptly disclose to our chief legal officer, general counsel, deputy general counsel or other person
+designated by the audit committee of the board of directors (i) any transaction in which we were, are or will be a participant and
+that related party had, has or will have a direct or indirect interest and (ii) all material facts with respect thereto. Our chief
+legal officer, general counsel, deputy chief legal officer or other person designated by the audit committee of the board of directors
+will make an initial assessment as to whether the transaction constitutes a related party transaction that would be reportable by us
+pursuant to Item 404(a) of Regulation S-K, in which case the transaction would require approval by either a majority of the
+members of our board of directors or all of the members of our audit committee.
+
+ 
+
+Since
+we do not currently have an Audit Committee, a proposal of action is prepared to the Board of Director for approval. It shows the purpose
+of action, ultimate beneficiary, controlling ownership, direct and indirect interest, and related documents such as an independent third-party
+report (if it is appropriate) for the Board s assessment.
+
+ 
+
+Our
+related party transactions for the years ended December 31, 2021 and 2020
+
+ 
+
+In
+support of the Company s efforts and cash requirements, it may rely on advances from related parties until such time that the Company
+can support its operations or attains adequate financing through sales of its equity or traditional debt financing. There is no formal
+written commitment for continued support by officers, directors, or shareholders. Amounts represent advances or amounts paid in satisfaction
+of liabilities. The advances are considered temporary in nature and have not been formalized by a promissory note.
+
+ 
+
+The
+Company received $0 and $193,000 consultancy service income from Everest Capital Corporation, its related party during the year ended
+December 31, 2021 and 2020, respectively.
+
+ 
+
+The
+Company paid $9,000 and $96,000 consulting fee to Honetech Inc., its controlling shareholder during the years ended December 31, 2021
+and 2020, respectively.
+
+ 
+
+The
+Company paid $0 and $60,000 consulting fee to Continental Development Corporation., its related party during the years ended December
+31, 2021 and 2020, respectively.
+
+ 
+
+The
+Company paid $180,000 and $410,500 consulting fee to Go Right Holdings Limited., its related party during the years ended December 31,
+2021 and 2020, respectively.
+
+ 
+
+The
+Company paid $154,804 and $111,377 salaries to certain shareholders during the years ended December 31, 2021 and 2020, respectively.
+
+ 
+
+As
+of December 31, 2021 and 2020, the Company had $0 and $114,999 related parties receivable balance included in deposits and prepayments.
+
+ 
+
+Apart from the transactions and balances detailed
+elsewhere in these accompanying consolidated financial statements, the Company has no other significant or material related party transactions
+during the periods presented.
+
+ 
+
+Apart from the transactions and balances detailed
+elsewhere in these accompanying consolidated financial statements, the Company has no other significant or material related party transactions
+during the periods presented.
+
+ 
+
+DESCRIPTION
+OF CAPITAL STOCK
+
+ 
+
+In
+General
+
+ 
+
+Our
+authorized capital stock of 75,000,000 shares. As of August 26, 2017, there were 4,500,000 shares of our common shares issued and outstanding
+that were held by 2 stockholders of record, and no shares of preferred stock issued and outstanding.
+
+ 
+
+common
+shares, $0.001 par value; 70,000,000 shares authorized.
+
+ 
+
+Preferred
+stock, $0.001 par value; 5,000,000 shares authorized.
+
+ 
+
+For
+the year ended April 30, 2018, the Company issued 3,360,000 (post-forward split) shares of its common shares at $0.03 per share for total
+proceeds of $25,200.
+
+ 61
+
+ 
+
+ 
+
+For
+the year ended April 30, 2019, the Company issued 96,024,000 (post-forward split) shares of its common shares at $0.001 per share for
+total proceeds of $24,006.
+
+ 
+
+For
+the period ended December 31, 2019, the Company cancelled 85,020,800 (post-forward split) shares of its common shares.
+
+ 
+
+On
+November 2, 2019, the Company approved an amendment to its Certificate of Incorporation (the Charter ) to file with the
+Secretary of State of the State of Nevada a Certificate of Amendment to the Charter (the Charter Amendment ). Pursuant to
+the Charter Amendment, the Company s Charter was amended, effective as of November 19, 2019, to effectuate a Four for One (4:1)
+forward split of the Company s shares of common shares.
+
+ 
+
+On
+January 15, 2020, the Company approved an amendment to the Company s Certificate of Incorporation (the Charter ) to
+file with the Secretary of State of the State of Nevada a Certificate of Amendment to the Charter (the Charter Amendment ).
+Pursuant to the Charter Amendment, the Company s Charter was amended, effective as of January 20, 2020, to effectuate a Four for
+One (4:1) forward split of the Company s shares of common shares. This amendment supersedes the amendment filed on November 2,
+2019 regarding the same Four for One (4:1) forward split.
+
+ 
+
+On
+January 20, 2020, after Four for One (4:1) forward split, there were 32,363,200 shares of our common shares and 832,200 shares of preferred
+stock issued and outstanding that were held by 65 shareholders.
+
+ 
+
+On
+March 28, 2020, the Company approved a transfer for 16,431,298 shares.
+
+ 
+
+On
+June 29, 2020, the Company cancelled 19,512,441 shares of its common shares.
+
+ 
+
+On
+July 10, 2020, the Company issued 13,083,162 shares of its common shares at $0.1 per share for total proceeds of $1,308,316.20
+
+ 
+
+On
+August 12, 2020, the Company cancelled 1,463,755 shares of its common shares and approved a transfer for 5,032,673 of its common shares.
+
+ 
+
+Since
+the Company expanded the business operations to include new types of marine tourism after the change of management in December 2018,
+the revenue and profit had not been as expected. These responsibilities of the losses were borne by the board of directors at that time,
+and these directors (major shareholders) were also willing to cancel their stock for capital reduction, in order to free up more shares
+to new investors. The board of directors was also reorganized, with most of the directors resigning. Most of the current shareholders
+are investors who recapitalized in the Company in July 2020. Existing shareholders will not plan to cancel their shares in the near future.
+
+ 
+
+The
+number of authorized shares and par value remain unchanged. All share and per share information in this consolidated financial statements
+and footnotes have been retroactively adjusted for the period and years presented, unless otherwise indicated, to give effect to the
+forward stock split.
+
+ 
+
+As
+of September 30, 2020 (unaudited), December 31, 2019, April 30, 2019 and 2018, the Company had a total of 24,470,166, 32,363,200 (post-forward
+split), 21,360,000 (post-forward split) and 21,360,000 (post-forward) split shares of its common
+shares issued and outstanding, respectively.
+
+ 
+
+Preferred
+stock, $0.001 par value; 5,000,000 shares authorized; 832,000 shares issued and outstanding as of April 30, 2019 and no change in preferred
+stock thereafter.
+
+ 
+
+On
+March 5, 2021, the company issued 468,888 shares to convert debt in the amount of $464,199.12 (RMB3,000,000)
+
+ 
+
+On
+April 23, 2021, the company issued 462,888 shares to convert debt in the amount of $462,888.00 (RMB3,006,110.74)
+
+ 
+
+On
+August 3, 2021, the Company issued 154,868 shares of common shares to settle a debt in the amount of $154,868 (equivalent to RMB1,000,548),
+at an agreed conversion price of $1.0 per share.
+
+ 
+
+The
+market price is a fair price to record the value of stocks in the transaction. Due to the significant difference between the market prices
+and conversion prices, a loss of $1,340,664 on the loan settlement has been recognized.
+
+ 
+
+On
+February 15, 2022, the Company issued 50,000 shares of common shares to settle a debt in the amount of $50,000, at an agreed conversion
+price of $1.0 per share. A loss of $2,000 on the loan settlement has been recognized in the six months ended September 30, 2022.
+
+ 62
+
+ 
+
+ 
+
+On
+March 22, 2022, the Company cancelled 60,000 shares of common shares previously issued to its former CFO due to termination of employment.
+
+ 
+
+As
+of September 30, 2022 and December 31, 2021, the Company had a total of 25,546,810 and 25,556,810 shares of its common shares issued
+and outstanding, respectively.
+
+ 
+
+Common shares
+
+ 
+
+The
+following is a summary of the material rights and restrictions associated with our common shares. This description does not purport to
+be a complete description of all the rights of our stockholders and is subject to, and qualified in its entirety by, the provisions of
+our most current Articles of Incorporation and Bylaws, which are included as exhibits to this Registration Statement.
+
+ 
+
+The
+holders of our common shares currently have (i) equal ratable rights to dividends from funds legally available therefore, when, as and
+if declared by the Board of Director of the Company; (ii) are entitled to share ratably in all of the assets of the Company available
+for distribution to holders of common shares upon liquidation, dissolution or winding up of the affairs of the Company (iii) do not have
+pre-emptive, subscription or conversion rights and there are no redemption or sinking fund provisions or rights applicable thereto; and
+(iv) are entitled to one non-cumulative vote per share on all matters on which stock holders may vote.
+
+ 
+
+Our
+Bylaws provide that at all meetings of the stockholders for the election of directors, a plurality of the votes cast shall be sufficient
+to elect. On all other matters, except as otherwise required by Nevada law or the Articles of Incorporation, a majority of the votes
+cast at a meeting of the stockholders shall be necessary to authorize any corporate action to be taken by vote of the stockholders. A
+ plurality means the excess of the votes cast for one candidate over any other. When there are more than two competitors
+for the same office, the person who receives the greatest number of votes has a plurality.
+
+ 
+
+Preferred
+Stock
+
+ 
+
+Our
+certificate of incorporation authorizes our board of directors, subject to any limitations prescribed by law, without further stockholder
+approval, to establish and to issue from time to time one or more classes or series of preferred stock, par value $0.001 per share, covering
+up to an aggregate of 5,000,000 shares of preferred stock. The holders of Series A Preferred Stock shall have the right to convert common
+shares at the conversion rate of Ten (10) shares of common shares for each share of Series A Preferred Stock and shall have voting rights
+equal to 50 votes per share of Series A Preferred Stock. The holders of Series A Preferred Stock shall be entitled to the dividend equal
+to the aggregate dividends for Ten (10) shares of common shares for every one share of Series A Preferred Stock.
+
+ 
+
+Upon
+any Liquidating Transaction (hereinafter defined), the holders of the Series A Preferred Stock shall be entitled to participate
+in the distribution of assets of the Corporation to the holders of its common shares, whether such assets are from capital, surplus or
+earnings in an amount up to the value of the Series A Preferred Stock at the time of the liquidation.
+
+ 
+
+After
+payment of the full amount on the liquidating distributions to which each holder of the Series A Preferred Stock is entitled, the holder
+of the Series A Preferred Stock shall have no light or claim to any of the remaining assets of the Corporation.
+
+ 
+
+For
+purposes of this Certificate of Designation, a Liquidating Transaction of the Corporation shall mean a (i) voluntary or involuntary
+liquidation, dissolution or winding up of the Corporation, (ii) the sale, transfer, conveyance, other disposal, exclusive lease, exclusive
+license or other disposition of all or substantially all of the assets, property or business of the Corporation, (iii) the effectuation
+of a transaction or series of related transactions in which more than fifty (50%) percent of the voting power of the Corporation is disposed
+of (other than as a direct result of normal, uncoordinated trading activities in the common shares generally), (iv) a transaction or
+series of transactions in which any person or group (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange
+Act of 1934) acquires more than fifty (50%) percent of the voting equity of the Corporation or (v) a transaction or series of transactions
+that constitutes or results in a going private transaction (as defined in Rule 13(e)-3 promulgated pursuant to the Securities
+Exchange Act of 1934 and the regulations of the Commission issued thereunder)
+
+ 
+
+Anti-takeover
+Effects of Our Certificate of Incorporation and Bylaws
+
+ 
+
+Some
+provisions of our certificate of incorporation and bylaws contain provisions that could make it more difficult to acquire us by means
+of a merger, tender offer, proxy contest or otherwise, or to remove our incumbent officers and directors. These provisions, summarized
+below, are expected to discourage coercive takeover practices and inadequate takeover bids. These provisions are also designed to encourage
+persons seeking to acquire control of us to first negotiate with our board of directors. We believe that the benefits of increased protection
+of our potential ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure us outweigh
+the disadvantages of discouraging such proposals because negotiation of such proposals could result in an improvement of their terms.
+
+ 
+
+Stockholder
+meetings. Our bylaws provide that a special meeting of stockholders may be called only by the Chairman of the Board, the Chief Executive
+Officer or by a resolution adopted by a majority of our board of directors.
+
+ 63
+
+ 
+
+ 
+
+Requirements
+for advance notification of stockholder nominations and proposals. Our bylaws establish advance notice procedures with respect to
+stockholder proposals and the nomination of candidates for election as directors, other than nominations made by or at the direction
+of our board of directors.
+
+ 
+
+Stockholder
+action by written consent. Our bylaws provide that no action that is required or permitted to be taken by our stockholders at any
+annual or special meeting may be affected by written consent of stockholders in lieu of a meeting of stockholders, unless the action
+to be affected by written consent of stockholders and the taking of such action by such written consent have expressly been approved
+in advance by our board of directors. This provision, which may not be amended except by the affirmative vote of holders of at least
+50% of the voting power of all then outstanding shares of capital stock entitled to vote generally in the election of directors, voting
+together as a single class, makes it difficult for stockholders to initiate or effect an action by written consent that is opposed by
+our board of directors.
+
+ 
+
+Amendment
+of the bylaws. Under Nevada law, the power to adopt, amend or repeal bylaws is conferred upon the stockholders. A corporation may,
+however, in its certificate of incorporation also confer upon the board of directors the power to adopt, amend or repeal its bylaws.
+Our certificate of incorporation and bylaws grant our board of directors the power to adopt, amend and repeal our bylaws at any regular
+or special meeting of our board of directors on the affirmative vote of a majority of the directors then in office. Our stockholders
+may adopt, amend or repeal our bylaws but only at any regular or special meeting of stockholders by an affirmative vote of holders of
+at least 66 2/3% of the voting power of all then outstanding shares of capital stock entitled to vote generally in the election of directors,
+voting together as a single class.
+
+ 
+
+These
+provisions of our certificate of incorporation and bylaws could have the effect of discouraging others from attempting hostile takeovers
+and, as a consequence, they may also inhibit temporary fluctuations in the market price of our common shares that often result from actual
+or rumored hostile takeover attempts. These provisions may also have the effect of preventing changes in our management. It is possible
+that these provisions could make it more difficult to accomplish transactions which stockholders may otherwise deem to be in their best
+interests.
+
+ 
+
+Amendment
+of the bylaws. Under Nevada law, the power to adopt, amend or repeal bylaws is conferred upon the stockholders. A corporation may, however,
+in its certificate of incorporation also confer upon the board of directors the power to adopt, amend or repeal its bylaws. Our certificate
+of incorporation and bylaws grant our board of directors the power to adopt, amend and repeal our bylaws at any regular or special meeting
+of our board of directors on the affirmative vote of a majority of the directors then in office. Our stockholders may adopt, amend, or
+repeal our bylaws but only at any regular or special meeting of stockholders by an affirmative vote of holders of at least 66 2/3% of
+the voting power of all then outstanding shares of capital stock entitled to vote generally in the election of directors, voting together
+as a single class.
+
+ 
+
+These
+provisions of our certificate of incorporation and bylaws could have the effect of discouraging others from attempting hostile takeovers
+and, as a consequence, they may also inhibit temporary fluctuations in the market price of our common shares that often result from actual
+or rumored hostile takeover attempts. These provisions may also have the effect of preventing changes in our management. It is possible
+that these provisions could make it more difficult to accomplish transactions which stockholders may otherwise deem to be in their best
+interests.
+
+ 
+
+SHARES
+ELIGIBLE FOR FUTURE SALE
+
+ 
+
+A
+total of 10,000,000 shares of common shares, as defined in Rule 144 of the Rules and Regulations of the SEC promulgated under the Securities
+Act. Under Rule 144, the shares can be publicly sold, subject to volume restrictions and restrictions on the manner of sale. Such shares
+can only be sold after six months provided that the issuer of the securities is, and has been for a period of at least 90 days immediately
+before the sale, subject to the reporting requirements of section 13 or 15(d) of the Exchange Act. Shares purchased in this offering,
+which will be immediately resalable, and sales of all our other shares after applicable restrictions expire, could have a depressive
+effect on the market price, if any, of our common shares and the shares we are offering.
+
+ 
+
+TAXATION
+
+ 
+
+The
+Company has operations in various countries and is subject to tax in the jurisdictions in which it operates, as follows.
+
+ 
+
+United
+States Federal Income Tax Considerations
+
+ 
+
+The
+following discussion is a summary of certain material U.S. federal income tax considerations generally applicable to the ownership and
+disposition of the ordinary shares by a U.S. Holder (as defined below) that acquires in this offering and holds the
+
+ 64
+
+ 
+
+ 
+
+securities as capital
+assets (generally, property held for investment) under the U.S. Internal Revenue Code of 1986, as amended, or the Code. This discussion
+is based upon existing U.S. federal tax law, which is subject to differing interpretations or change, possibly with retroactive effect.
+No ruling has been sought from the Internal Revenue Service, the IRS, with respect to any U.S. federal income tax consequences described
+below, and there can be no assurance that the IRS or a court will not take a contrary position. This discussion, moreover, does not address
+the U.S. federal estate, gift, Medicare, and alternative minimum tax considerations, any election to apply Section 1400Z-2 of the Code
+to gains recognized with respect to sales or other dispositions of the ordinary shares, or any state, local or non-U.S. tax considerations,
+relating to the ownership or disposition of the ordinary shares. The following summary does not address all aspects of U.S. federal income
+taxation that may be important to particular investors in light of their individual circumstances or to persons in special tax situations
+such as:
+
+ 
+
+ banks
+ and other financial institutions;
+
+ 
+
+ insurance
+ companies;
+
+ 
+
+ pension
+ plans;
+
+ 
+
+ cooperatives;
+
+ 
+
+ regulated
+ investment companies;
+
+ 
+
+ real
+ estate investment trusts;
+
+ 
+
+ broker-dealers;
+
+ 
+
+ traders
+ that elect to use a mark-to-market method of accounting;
+
+ 
+
+ certain
+ former U.S. citizens or long-term residents;
+
+ 
+
+ tax-exempt
+ entities (including private foundations);
+
+ 
+
+ persons
+ liable for alternative minimum tax;
+
+ 
+
+ holders
+ who acquire the ordinary shares pursuant to any employee share option or otherwise as compensation;
+
+ 
+
+ investors
+ that will hold the ordinary shares as part of a straddle, hedge, conversion, constructive
+ sale, or other integrated transaction for U.S. federal income tax purposes;
+
+ 
+
+ investors
+ that have a functional currency other than the U.S. dollar;
+
+ 
+
+ persons
+ subject to special tax accounting rules as a result of any item of gross income with respect
+ to the ordinary shares being taken into account in an applicable financial statement;
+
+ 
+
+ persons
+ that actually or constructively own 10% or more of the total combined voting power of all
+ classes of our voting stock; or
+
+ 
+
+ partnerships
+ or other entities taxable as partnerships for U.S. federal income tax purposes, or persons
+ holding common shares through such entities.
+
+ 
+
+all
+of whom may be subject to tax rules that differ significantly from those discussed below.
+
+ 
+
+Each
+U.S. Holder is urged to consult its tax advisor regarding the application of U.S. federal taxation to its particular circumstances, and
+the state, local, non-U.S. and other tax considerations of the ownership and disposition of the ordinary shares.
+
+ 
+
+General
+
+ 
+
+For
+purposes of this discussion, a U.S. Holder is a beneficial owner of the ordinary shares that is, for U.S. federal income
+tax purposes:
+
+ 
+
+ an
+ individual who is a citizen or resident of the United States;
+
+ 
+
+ a
+ corporation (or other entity treated as a corporation for U.S. federal income tax purposes)
+ created in, or organized under the law of the United States or any state thereof or the District
+ of Columbia;
+
+ 
+
+ an
+ estate the income of which is includible in gross income for U.S. federal income tax purposes
+ regardless of its source; or
+
+ 
+
+ a
+ trust (A) the administration of which is subject to the primary supervision of a U.S. court
+ and which has one or more U.S. persons who have the authority to control all substantial
+ decisions of the trust or (B) that has otherwise validly elected to be treated as a U.S.
+ person under the Code.
+
+ 
+
+If
+a partnership (or other entity treated as a partnership for U.S. federal income tax purposes) is a beneficial owner of the ordinary shares,
+the tax treatment of a partner in the partnership will generally depend upon the status of the partner and the activities of the partnership.
+Partnerships holding the ordinary shares and their partners are urged to consult their tax advisors regarding an investment in the ordinary
+shares.
+
+ 
+
+At
+present, VIVIC has reinvested into Taiwan, China, and Hong Kong, but the corporate income taxes are all different in each region. If
+the subsidiaries in these three regions make profits and the board of directors agrees to distribute dividends, they must deduct 10%
+capital gains tax before remitting back to the parent company. The funds returned to the parent company are the real investment income.
+However, because The United States has tax treaties with China and Hong Kong, those taxes are paid by subsidiaries in these two regions.
+These can be deducted from the income tax payable of the parent company in the United States.
+
+ 65
+
+ 
+
+ 
+
+In contrast, Taiwan and the United States
+have not signed any tax treaties . VIVIC TW is a branch office, not a subsidiary, so all income and expenses of the Taiwan branch have
+to be merged with the US parent company s income and expenses. In other words, there is no tax impact.
+
+ 
+
+Therefore,
+from the investor s point of view, when considering the impact of the tax burden, you only need to consider the federal and state
+tax rates in the United States based on the consolidated statement of the head office.
+
+ 
+
+The
+following is a summary of taxation policies in Taiwan, Hong Kong and China.
+
+ 
+
+Taiwan
+
+ 
+
+The
+following is a general summary of the principal Taiwan tax consequences of the ownership and disposition of our common shares by and
+to a non-resident individual or non-resident entity holder (referred to herein as a Non-Taiwan Holder ). As used in the
+preceding sentence, a non-resident individual is a foreign national who owns our ordinary shares and is not physically
+present in Taiwan for 183 days or more during any calendar year, and a non-resident entity is a corporation or a non-corporate
+body that owns our ordinary shares and is organized under the laws of a jurisdiction other than Taiwan.
+
+ 
+
+Holders
+should consult their tax advisors concerning the Taiwan tax consequences of holding our ordinary shares and the laws of any relevant
+taxing jurisdiction to which they are subject.
+
+ 
+
+Capital
+gains from the sale or disposal of our ordinary shares
+
+ 
+
+Sale
+or disposal of our ordinary shares is not regarded as the sale of Taiwan securities; thus, any gains generated therefrom by Non-Taiwan
+Holders are not subject to Taiwan income tax.
+
+ 
+
+Securities
+Transaction Tax
+
+ 
+
+Sale
+of our ordinary shares by Non-Taiwan Holders is not subject to Taiwan securities transaction tax.
+
+ 
+
+Hong
+Kong
+
+ 
+
+The
+Company s subsidiary operating in Hong Kong is subject to the Hong Kong Profits Tax at the tax rates ranging from 8.25% to 16.5%
+on the assessable income arising in Hong Kong during its tax year. The operations in Hong Kong incurred an operating loss and there is
+no provision for income tax for the three months ended December 31, 2021 and 2020.
+
+ 
+
+The
+People s Republic of China
+
+ 
+
+According
+to the Enterprise Income Tax Law of the PRC (the Income Tax Law ) and the Implementation Regulations of Enterprise Income
+Tax Law of the PRC, the enterprise income tax for both domestic and foreign-invested enterprises are unified at 25%.
+
+ 
+
+According
+to the Income Tax Law, income such as dividends, rental, interest and royalty from the PRC derived by a non-resident enterprise which
+has no establishment in the PRC or has establishment but the income has no relationship with such establishment is subject to a 10% withholding
+tax, which may be reduced if the foreign jurisdiction of incorporation has a tax treaty with the PRC that provides for a different withholding
+arrangement, unless the relevant income is specifically exempted from tax under the applicable income tax laws, regulations, notices
+and decisions which relate to foreign invested enterprises and their investors.
+
+ 
+
+According
+to the Notice of the State Administration of Taxation of China on Issues Relating to the Administration of the Dividend Provision in
+Tax Treaties, the corporate recipients of dividends distributed by PRC enterprises must satisfy the direct ownership thresholds at all
+times during the twelve (12) consecutive months preceding the receipt of the dividends.
+
+ 
+
+LEGAL
+MATTERS
+
+ 
+
+No
+director, person nominated to become a director, executive officer, promoter or control person of our company has, during the last ten
+years: (i) been convicted in or is currently subject to a pending a criminal proceeding (excluding traffic violations and other minor
+offenses); (ii) been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of
+such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities
+subject to any federal or state securities or banking or commodities laws including, without limitation, in any
+
+ 66
+
+ 
+
+ 
+
+way limiting involvement
+in any business activity, or finding any violation with respect to such law, nor (iii) any bankruptcy petition been filed by or against
+the business of which such person was an executive officer or a general partner, whether at the time of the bankruptcy or for the two
+years prior thereto.
+
+ 
+
+EXPERTS
+
+ 
+
+The
+consolidated financial statements as of December 31, 2021 and 2020, and for each of the two years ended December 31, 2021 and 2020 included
+in this prospectus have been so included in reliance on the report of YCM CPA,Inc. and HKCM CPA & Co respectively and each as an
+independent registered public accounting firm, given on the authority of said firm as experts in auditing and accounting. The office
+of YCM CPA,Inc. is located at 2400 Barranca Pkwy #300 Irvine, CA 92606, and the office of HKCM CPA & Co. is located at15th Floor,
+Aubin House, 171-172 Gloucester Road, Wan Chai, Hong Kong.
+
+ 
+
+WHERE
+YOU CAN FIND ADDITIONAL INFORMATION
+
+ 
+
+We
+have filed with the Commission a Registration Statement on
\ No newline at end of file
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index 0000000000000000000000000000000000000000..f81af446f571c65c36cf741a93e210052bf5985c
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@@ -0,0 +1 @@
+to the publication in this prospectus of the summary of its report to VWF Bancorp setting forth its opinion as to the estimated pro forma market value of the shares of common stock upon completion of the conversion and stock offering and of its letter with respect to subscription rights. CHANGE IN AUDITOR On November 9, 2021, Van Wert Federal dismissed BKD, LLP and engaged Wipfli LLP as its independent auditor. This change in auditors was approved by Van Wert Federal s Audit Committee. Wipfli LLP was engaged to audit the financial statements of Van Wert Federal for the years ended June 30, 2021 and 2020 according to auditing standards of the Public Company Accounting Oversight Board. Before the engagement of Wipfli LLP, Van Wert Federal did not consult with Wipfli LLP regarding the application of accounting principles to a specific completed or proposed transaction or regarding the type of audit opinion that might be rendered by Wipfli LLP on Van Wert Federal s financial statements, and Wipfli LLP did not provide any written or oral advice that was an important factor considered by Van Wert Federal in reaching a decision as to any such accounting, auditing or financial reporting issue, and Van Wert Federal did not consult with Wipfli LLP regarding any of the matters or events set forth in Item 304(a)(2)(ii) of Regulation S-K. The report of BKD, LLP on its audit of the financial statements of Van Wert Federal for the years ended June 30, 2021 and 2020, performed under AICPA auditing standards, did not contain an adverse opinion or disclaimer of opinion and was not qualified or modified as to uncertainty, audit scope or accounting principle. In connection with its audit of the financial statements of Van Wert Federal for the years ended June 30, 2021 and 2020, performed under AICPA standards, there were no disagreements with BKD, LLP on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of BKD, LLP, would have caused them to make reference thereto in their reports, and there have been no reportable events as described in Item 304(a)(1)(v) of Regulation S-K. 129 Van Wert Federal provided BKD, LLP with a copy of this disclosure before its filing with the Securities and Exchange Commission and requested that BKD, LLP furnish Van Wert Federal with a letter addressed to the Securities and Exchange Commission stating whether it agrees with the above statements and, if it does not agree, the respects in which it does not agree. A copy of the letter is filed as an exhibit to the registration statement of VFW Bancorp, of which this prospectus is a part. LEGAL MATTERS Luse Gorman, PC, Washington, D.C., counsel to VWF Bancorp and Van Wert Federal, has issued to VWF Bancorp its opinion regarding the legality of the common stock and has issued to VWF Bancorp and Van Wert Federal its opinion regarding the federal income tax consequences of the conversion and stock offering. Wipfli LLP has issued its opinion to VWF Bancorp and Van Wert Federal regarding the Ohio state income tax consequences of the conversion and stock offering. Certain legal matters will be passed upon for Performance Trust by Hogan Lovells US LLP, Washington, D.C. WHERE YOU CAN FIND ADDITIONAL INFORMATION VWF Bancorp has filed with the Securities and Exchange Commission a registration statement under the Securities Act of 1933, as amended, with respect to the shares of common stock offered hereby. As permitted by the rules and regulations of the Securities and Exchange Commission, this prospectus does not contain all the information set forth in the registration statement. Such information, including the appraisal report, which is an exhibit to the registration statement, can be examined without charge at the public reference facilities of the Securities and Exchange Commission located at 100 F Street, N.E., Washington, D.C. 20549, and copies of such material can be obtained from the Securities and Exchange Commission at prescribed rates. The Securities and Exchange Commission telephone number is 1-800-SEC-0330. In addition, the Securities and Exchange Commission maintains a web site (www.sec.gov) that contains reports, proxy and information statements and other information regarding registrants that file electronically with the Securities and Exchange Commission, including VWF Bancorp. The statements contained in this prospectus as to the contents of any contract or other document filed as an exhibit to the registration statement are, of necessity, brief descriptions of the material terms of, and should be read in conjunction with, such contract or document. Van Wert Federal has filed with the OCC an application for conversion. This prospectus omits certain information contained in the application. The application may be examined at the OCC Central District Office located at 425 S. Financial Place, Suite 1700, Chicago, Illinois 60605. A copy of the plan of conversion is available for review at Van Wert Federal s office. In connection with the conversion and stock offering, VWF Bancorp will register its common stock under Section 12 of the Securities Exchange Act of 1934. Upon registration, VWF Bancorp and the holders of its common stock will become subject to the proxy solicitation rules, reporting requirements and restrictions on common stock purchases and sales by directors, officers and greater than 10% stockholders, the annual and periodic reporting and certain other requirements of the Securities Exchange Act of 1934. Under the plan of conversion, VWF Bancorp has undertaken that it will not terminate such registration for a period of at least three years following the consummation of the conversion and stock offering. 131 4890 Owen Ayres Ct. 715 832 3407 Suite 200 wipfli.com Eau Claire, WI 54701 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Shareholders Van Wert Federal Savings Bank Van Wert, Ohio Opinion on the Financial Statements We have audited the accompanying balance sheets of Van Wert Federal Savings Bank (the "Bank") as of June 30, 2021 and 2020, and the related statements of operations, comprehensive income (loss), changes in equity and cash flows for the years then ended and the related notes (collectively, the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Bank as of June 30, 2021 and 2020, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These financial statements are the responsibility of the Bank s management. Our responsibility is to express an opinion on the Bank s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Bank in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Bank is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Bank s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. We have served as the Bank s auditor since 2021. Wipfli LLP Eau Claire, Wisconsin March 4, 2022 F-1 Van Wert Federal Savings Bank Balance Sheets December 31, 2021 (Unaudited) and June 30, 2021 and 2020 December 31, June 30, 2021 2021 2020 (Unaudited) Assets Cash and due from banks $31,549,304 $11,660,839 $23,773,919 Interest-bearing time deposits 3,420,000 4,890,000 8,075,000 Available-for-sale debt securities 18,310,171 28,526,420 11,063,796 Loans, net of allowance for loan losses of $222,884 at Deember 31, 2021, June 30, 2021 and 2020 77,419,787 74,384,207 69,495,771 Premises and equipment 1,395,784 1,421,166 1,451,100 Federal Home Loan Bank stock 1,012,900 1,012,900 1,012,900 Bank owned life insurance 5,058,567 5,003,803 4,892,967 Accrued interest receivable 198,121 193,018 221,344 Other assets 188,380 134,596 175,784 Total assets $138,553,014 $127,226,949 $120,162,581 Liabilities and Equity Liabilities Deposits Demand $27,211,074 $19,237,348 $16,972,408 Savings 47,821,779 43,184,282 35,386,095 Time 37,241,539 38,501,260 41,434,177 Total deposits 112,274,392 100,922,890 93,792,680 Advances from borrowers for taxes and insurance 729,686 579,312 594,412 Accrued interest payable and other liabilities 296,512 328,771 413,266 Total liabilities 113,300,590 101,830,973 94,800,358 Commitments and Contingencies Equity Retained earnings 25,363,218 25,471,008 25,277,733 Accumulated other comprehensive income (loss) (110,794) (75,032) 84,490 Total equity 25,252,424 25,395,976 25,362,223 Total liabilities and equity $138,553,014 $127,226,949 $120,162,581 See Notes to Financial StatementsF-2 Van Wert Federal Savings Bank Statements of Operations Six Months Ended December 31, 2021 and 2020 (Unaudited) and Years Ended June 30, 2021 and 2020 Six Months Ended Year Ended December 31, June 30, 2021 2020 2021 2020 (Unaudited) Interest Income Loans $1,363,056 $1,381,239 $2,746,377 $2,872,360 Investment securities 156,343 79,994 206,720 378,064 Interest-bearing deposits and other 53,619 93,235 157,247 337,210 Total interest income 1,573,018 1,554,468 3,110,344 3,587,634 Interest Expense Deposits 179,009 251,658 452,904 721,052 Federal Home Loan Bank advances 1 2 2 11 Total interest expense 179,010 251,660 452,906 721,063 Net Interest Income 1,394,008 1,302,808 2,657,438 2,866,571 Provision for Loan Losses - - - - Net Interest Income After Provision for Loan Losses 1,394,008 1,302,808 2,657,438 2,866,571 Noninterest Income Bank owned life insurance 54,764 56,288 110,836 117,652 Other income 54,088 47,001 103,143 96,910 Total noninterest income 108,852 103,289 213,979 214,562 Noninterest Expense Salaries and employee benefits 706,950 673,834 1,368,035 1,418,341 Directors fees 95,500 98,667 202,667 154,333 Occupancy and equipment 90,027 89,683 174,700 184,479 Data processing fees 114,230 98,306 204,906 195,952 Franchise taxes 69,780 65,231 134,936 165,132 FDIC insurance premiums 16,300 10,220 25,230 2,267 Professional services 73,005 75,206 140,824 142,298 Loss on sale of investment securities 291,198 - - - Other 191,106 164,861 327,132 329,645 Total noninterest expense 1,648,096 1,276,008 2,578,430 2,592,447 Income (loss) before income taxes (145,236) 130,089 292,987 488,686 Provision for income taxes (benefit) (37,446) 14,860 35,223 77,489 Net Income (Loss) $(107,790) $115,229 $257,764 $411,197 See Notes to Financial StatementsF-3 Van Wert Federal Savings Bank Statements of Comprehensive Income (Loss) Six Months Ended December 31, 2021 and 2020 (Unaudited) and Years Ended June 30, 2021 and 2020 Six Months Ended Year Ended December 31, June 30, 2021 2020 2021 2020 (Unaudited) Net Income (Loss) $(107,790) $115,229 $257,764 $411,197 Other comprehensive income (loss): Net unrealized gains (losses) on available-for-sale securities (336,467) 69,002 (201,927) 174,880 Reclassification adjustment for realized losses on sale of securities 291,198 - - - Tax (expense) benefit 9,507 (14,490) 42,405 (36,725) Other comprehensive income (loss) (35,762) 54,512 (159,522) 138,155 Comprehensive income (loss) $(143,552) $169,741 $98,242 $549,352 See Notes to Financial StatementsF-4 Van Wert Federal Savings Bank Statements of Changes in Equity Six Months Ended December 31, 2021 (Unaudited) and Years Ended June 30, 2021 and 2020 Accumulated Other Retained Comprehensive Earnings Income (Loss) Total Balance at July 1, 2019 $24,866,536 $(53,665) $24,812,871 Net income 411,197 - 411,197 Other comprehensive income - 138,155 138,155 Balance at June 30, 2020 25,277,733 84,490 25,362,223 Cumulative effect of change in accounting principle (64,489) - (64,489) Net income 257,764 - 257,764 Other comprehensive loss - (159,522) (159,522) Balance at June 30, 2021 25,471,008 (75,032) 25,395,976 Net loss (unaudited) (107,790) - (107,790) Other comprehensive loss (unaudited) - (35,762) (35,762) Balance at December 31, 2021 (unaudited) $25,363,218 $(110,794) $25,252,424 See Notes to Financial StatementsF-5 Van Wert Federal Savings Bank Statements of Cash Flows Six Months Ended December 31, 2021 and 2020 (Unaudited) and Years Ended June 30, 2021 and 2020 Six Months Ended Year Ended December 31, June 30, 2021 2020 2021 2020 (Unaudited) Operating Activities Net income (loss) $(107,790) $115,229 $257,764 $411,197 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 33,860 36,858 70,936 77,555 Amortization of premiums and discounts 55,243 41,097 44,813 48,063 Deferred income taxes (7,300) (8,093) (17,166) (5,091) Provision for loan losses - - - - Loss on sale of investment securities 291,198 - - - Increase in cash surrender value of bank-owned life insurance (54,764) (56,288) (110,836) (117,652) Changes in: Accrued interest receivable (5,103) 44,960 28,326 103,434 Other assets and liabilities (69,236) (60,848) 16,264 (20,180) Net cash provided by operating activities 136,108 112,915 290,101 497,326 Investing Activities Net change in interest-bearing time deposits 1,470,000 1,960,000 3,185,000 30,000 Purchases of available-for-sale securities (2,602,262) (10,834,935) (24,347,114) (7,991,817) Proceeds from calls, maturities and paydowns of available-for-sale securities 2,718,358 1,217,602 6,573,261 24,779,821 Proceeds from sales of investment securities 9,708,443 - - Net change in loans (3,035,580) (824,069) (4,888,436) (2,430,551) Purchase of premises and equipment (8,478) (39,802) (41,002) (20,909) Net cash provided by (used in) investing activities 8,250,481 (8,521,204) (19,518,291) 14,366,544 Financing Activities Net increase in deposit accounts 11,351,502 4,047,379 7,130,210 3,976,969 Net change in advances by borrowers for taxes and insurance 150,374 91,715 (15,100) 84,038 Net cash provided by financing activities 11,501,876 4,139,094 7,115,110 4,061,007 Increase (Decrease) in Cash and Cash Equivalents 19,888,465 (4,269,195) (12,113,080) 18,924,877 Cash and Cash Equivalents, Beginning of Period 11,660,839 23,773,919 23,773,919 4,849,042 Cash and Cash Equivalents, End of Period $31,549,304 $19,504,724 $11,660,839 $23,773,919 Supplemental Disclosure of Cash Flow Information Cash paid during the period for: Interest on deposits and borrowings $178,965 $251,670 $452,944 $721,152 Income taxes - 75,000 105,731 55,000 See Notes to Financial StatementsF-6 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Note 1:Nature of Operations and Summary of Significant Accounting Policies Inclusion of Unaudited Information The financial information included herein as of December 31, 2021 and for the interim periods ended December 31, 2021 and 2020 is unaudited. However, in management s opinion, the information reflects all normal, recurring adjustments that are necessary for a fair presentation. The results shown for the six months ended December 31, 2021 and 2020 are not necessarily indicative of the results to be obtained for a full year. Nature of Operations Van Wert Federal Savings Bank ("Bank") is a federally chartered mutual thrift engaged primarily in the business of making residential mortgage loans and accepting deposits. Its operations are conducted through its office located in Van Wert, Ohio. The Bank faces competition from other financial institutions and is subject to the regulation of certain federal and state agencies and undergoes periodic examinations by those regulatory authorities. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, valuation of real estate acquired in connection with foreclosures or in satisfaction of loans, valuation of deferred tax assets and fair values of financial instruments. Change in Accounting Principle In March 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2017-08 Premium Amortization on Purchased Callable Debt Securities. ASU 2017-08 amended the amortization period to the earliest call date for purchased callable debt securities held at a premium. Prior to implementation of the ASU, premiums on securities were amortized to the maturity date of the security. The ASU was effective, as to the Bank, for fiscal years beginning after December 15, 2019. The Bank adopted ASU 2017-08 effective July 1, 2020, as required. As provided for in the ASU, a cumulative effect adjustment, representing a charge of $64,489, was recorded to retained earnings upon adoption, which equaled the difference at that date between use of the shorter amortization period to the call date for securities affected by the change. F-7 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Cash Equivalents The Bank considers all liquid investments with original maturities of three months or less to be cash equivalents. At December 31, 2021, (unaudited) June 30, 2021 and 2020, none of the Bank s cash accounts at nonfederal government or nongovernmental agencies exceeded FDIC insurance limits. Effective March 26, 2020, the Federal Reserve's board of directors approved reducing the required reserve requirement ratios to zero percent, effectively eliminating the requirement to maintain reserve balances in cash or on deposit with the Federal Reserve Bank. This reduction in the required reserves does not have a defined timeframe and may be revised by the Federal Reserve's board in the future. Interest-bearing Time Deposits in Banks Interest-bearing time deposits have original maturities greater than one year and are carried at cost. Debt Securities Debt securities held by the Bank generally are classified and recorded in the financial statements as follows: Classified as Description Recorded at Held to maturity Certain debt securities that Amortized cost ("HTM") management has the positive intent and ability to hold to maturity Trading Securities that are bought and held Fair value, with changes in fair principally for the purpose of selling value included in earnings in the near term and, therefore, held for only a short period of time Available for sale Securities not classified as HTM or Fair value, with urealized gains ("AFS") trading and losses excluded from earnings and reported in other comprehensive income Purchase premiums and discounts are recognized in interest income using the interest method over the terms of the securities, identified as the call date as to premiums and maturity date as to discounts. Gains and losses on the sale of securities are recorded on the trade date and are determined using the specific identification method. F-8 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 When the fair value of securities is below amortized cost, the Bank s accounting treatment for an other-than-temporary impairment ("OTTI") is as follows: Accounting Treatment for OTTI Components Circumstances of Impairment Credit Remaining Considerations Component Portion Not intended for sale and more likely than not that Recognized in Recognized in other the Bank will not have to sell before recovery of earnings comprehensive cost basis income Intended for sale or more likely than not that the Recognized in earnings Bank will be required to sell before recovery of cost basis For held-to-maturity debt securities, the amount of OTTI recorded in other comprehensive income for the noncredit portion of a previous OTTI is amortized prospectively over the remaining life of the security on the basis of the timing of future estimated cash flows of the security. When a credit loss component is separately recognized in earnings, the amount is identified as the total of principal cash flows not expected to be received over the remaining term of the security, as projected based on cash flow projections. The Bank recognized no other-than-temporary impairments on debt securities in the six month periods ended December 31, 2021 and 2020 (unaudited) and the years ended June 30, 2021 or 2020. Loans Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at their outstanding principal balances adjusted for unearned income, charge-offs, the allowance for loan losses and any unamortized deferred fees or costs on originated loans and unamortized premiums or discounts on purchased loans. For loans amortized at cost, interest income is accrued based on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, as well as premiums and discounts, are deferred and amortized as a level yield adjustment over the respective term of the loan. F-9 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 For all loan portfolio segments except residential and consumer loans, the Bank promptly charges-off loans, or portions thereof, when available information confirms that specific loans are uncollectible based on information that includes, but is not limited to, (1) the deteriorating financial condition of the borrower, (2) declining collateral values, and/or (3) legal action, including bankruptcy, that impairs the borrower s ability to adequately meet its obligations. For impaired loans that are considered to be solely collateral dependent, a partial charge-off is recorded when a loss has been confirmed by an updated appraisal or other appropriate valuation of the collateral. The Bank charges-off loans, or portions thereof, when the Bank reasonably determines the amount of the loss. The Bank adheres to delinquency thresholds established by applicable regulatory guidance to determine the charge-off timeframe for these loans. Loans at these delinquency thresholds for which the Bank can clearly document that the loan is both well-secured and in the process of collection, such that collection will occur regardless of delinquency status, need not be charged off. For all classes, all interest accrued but not collected for loans that are placed on nonaccrual or charged off is reversed against interest income. The interest on these loans is accounted for on the cash basis or cost recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. Nonaccrual loans are returned to accrual status when, in the opinion of management, the financial position of the borrower indicates there is no longer any reasonable doubt as to the timely collection of interest or principal. The Bank requires a period of satisfactory performance of not less than six months before returning a nonaccrual loan to accrual status. When cash payments are received on impaired loans, the Bank records the payment as interest income unless collection of the remaining recorded principal amount is doubtful, at which time payments are used to reduce the principal balance of the loan. Troubled debt restructured loans recognize interest income on an accrual basis at the renegotiated rate if the loan is in compliance with the modified terms, no principal reduction has been granted and the loan has demonstrated the ability to perform in accordance with the renegotiated terms for a period of at least six months. Allowance for Loan Losses The allowance for loan losses is a valuation allowance for probable incurred credit losses. Loan losses are charged against the allowance when management believes the collectibility of a loan balance is doubtful. Subsequent recoveries, if any, are credited to the allowance. The allowance for loan losses is evaluated on a quarterly basis by management and is based upon management s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. F-10 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 The allowance consists of allocated and general components. The allocated component relates to loans that are classified as impaired. For those loans that are classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan. The general component covers nonimpaired loans and is based on historical charge-off experience by segment. The historical loss experience is determined by portfolio segment and is based on the actual loss history experienced by the Bank over the prior three years. Management believes the three-year historical loss experience methodology is appropriate in the current economic environment. Other adjustments (qualitative/environmental considerations) for each segment may be added to the allowance for each loan segment after an assessment of internal or external influences on credit quality that are not fully reflected in the historical loss or risk rating data. A loan is considered impaired when, based on current information and events, it is probable that the Bank will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment history, collateral value and the probability of collecting scheduled principal and interest payments when due, based on the loan s current payment status and the borrower s financial condition, including available sources of cash flows. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower s prior payment record and the amount of the shortfall in relation to the principal and interest owed. Impairment is generally measured on a loan-by-loan basis by either the present value of expected future cash flows discounted at the loan s effective interest rate, the loan s obtainable market price or the fair value of the collateral if the loan is collateral dependent. For impaired loans where the Bank utilizes the discounted cash flows to determine the level of impairment, the Bank includes the entire change in the present value of cash flows as a provision for loan losses. The fair values of collateral dependent impaired loans are based on independent appraisals of the collateral. In general, the Bank acquires an updated appraisal upon identification of impairment and annually thereafter for commercial, commercial real estate and multi-family loans. If the most recent appraisal is over a year old, and a new appraisal is not performed, due to lack of comparable values or other reasons, the existing appraisal is utilized and discounted based on the age of the appraisal, condition of the subject property and overall economic conditions. After determining the collateral value as described, the fair value is calculated based on the determined collateral value less selling expenses. The potential for outdated appraisal values is considered in our determination of the allowance for loan losses through our analysis of various trends and conditions including the local economy, trends in charge-offs and delinquencies and the related qualitative adjustments assigned by the Bank. F-11 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Segments of loans with similar risk characteristics are collectively evaluated for impairment based on the segment s historical loss experience adjusted for changes in trends, conditions and other relevant factors that affect repayment of the loans. In the course of working with borrowers, the Bank may choose to restructure the contractual terms of certain loans. In this scenario, the Bank attempts to work out an alternative payment schedule with the borrower in order to optimize collectibility of the loan. Any loans that are modified are reviewed by the Bank to identify if a troubled debt restructuring ("TDR") has occurred, which is when, for economic or legal reasons related to a borrower s financial difficulties, the Bank grants a concession to the borrower that it would not otherwise consider. Terms may be modified to fit the ability of the borrower to repay in line with the borrower s current financial status, and the restructuring of the loan may include the transfer of assets from the borrower to satisfy the debt, a modification of loan terms or a combination of the two. If such efforts by the Bank do not result in a satisfactory arrangement, the loan is referred to legal counsel, at which time foreclosure proceedings are initiated. At any time prior to a sale of the property at foreclosure, the Bank may terminate foreclosure proceedings if the borrower is able to work out a satisfactory payment plan. It is the Bank s policy that any restructured loans on nonaccrual status prior to being restructured remain on nonaccrual status until six months of satisfactory borrower performance, at which time management would consider its return to accrual status. If a loan was accruing at the time of restructuring, the Bank reviews the loan to determine if it is appropriate to continue the accrual of interest on the restructured loan. With regard to determination of the amount of the allowance for loan losses, troubled debt restructured loans are considered to be impaired. As a result, the determination of the amount of impaired loans for each portfolio segment within troubled debt restructurings is the same as detailed previously. Premises and Equipment Depreciable assets are stated at cost less accumulated depreciation. Depreciation is charged to expense using the straight-line method over the estimated useful lives of the assets. The estimated useful lives of depreciable assets are as follows: building and improvements are 5-40 years; furniture and fixtures are 5-10 years; information technology-related equipment is 3-5 years. Federal Home Loan Bank Stock Federal Home Loan Bank ("FHLB") stock is a required investment for institutions that are members of the FHLB system and the transfer of the stock is substantially restricted. The required investment in the common stock is based on a predetermined formula. FHLB stock is carried at cost less an impairment, which approximates fair value. FHLB stock is evaluated for impairment on an annual basis. F-12 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Bank Owned Life Insurance The Bank has purchased life insurance on certain employees. Bank owned life insurance is recorded at the amount that can be realized under the insurance contract at the balance sheet date, which is the cash surrender value adjusted for other charges or other amounts due that are probable at settlement. Foreclosed Assets Held for Sale Assets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at fair value less cost to sell at the date of foreclosure, establishing a new cost basis. Subsequent to foreclosure, valuations are periodically performed by management and the assets are carried at the lower of carrying amount or fair value less cost to sell. Revenue and expenses from operations and changes in the valuation allowance are included in net income or expense from foreclosed assets. At December 31, 2021, (unaudited) and June 30, 2021 and 2020, there were no foreclosed residential real estate properties. At December 31, 2021, (unaudited) and June 30, 2021 and 2020, there were no consumer mortgage loans secured by residential real estate properties for which formal foreclosure proceeds are in process. Income Taxes The Bank accounts for income taxes in accordance with income tax accounting guidance (Accounting Standards Codification ("ASC") 740, Income Taxes). The income tax accounting guidance results in two components of income tax expense: current and deferred. Current income tax expense reflects taxes to be paid or refunded for the current period by applying the provisions of the enacted tax law to the taxable income or excess of deductions over revenues. The Bank determines deferred income taxes using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is based on the tax effects of the differences between the book and tax basis of assets and liabilities, and enacted changes in tax rates and laws are recognized in the period in which they occur. Deferred income tax expense results from changes in deferred tax assets and liabilities between periods. Deferred tax assets are reduced by a valuation allowance if, based on the weight of evidence available, it is more likely than not that some portion or all of a deferred tax asset will not be realized. Tax positions are recognized if it is more likely than not, based on the technical merits, that the tax position will be realized or sustained upon examination. The term more likely than not means a likelihood of more than 50 percent; the terms examined and upon examination also include resolution of the related appeals or litigation processes, if any. A tax position that meets the more-likely-than-not recognition threshold is initially and subsequently measured as the largest amount of tax benefit that has a greater than 50 percent likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. F-13 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 The determination of whether or not a tax position has met the more-likely-than-not recognition threshold considers the facts, circumstances and information available at the reporting date and is subject to management s judgment. If necessary, the Bank recognizes interest and penalties on income taxes as a component of income tax expense. With a few exceptions, the Bank is no longer subject to examination by tax authorities for calendar years before 2018. As of December 31, 2021, (unaudited) and June 30, 2021 and 2020, the Bank had no material uncertain income tax positions. Comprehensive Income (Loss) Comprehensive income (loss) consists of net income and other comprehensive income (loss), net of applicable income taxes. Other comprehensive income (loss) includes unrealized appreciation (depreciation) on available-for-sale securities and, if necessary, unrealized appreciation (depreciation) on available-for-sale securities for which a portion of an other-than-temporary impairment has been recognized in income. Accumulated other comprehensive income (loss) consists solely of the cumulative unrealized gains and losses on available-for-sale securities, net of tax. Revenue Recognition On July 1, 2020, the Bank adopted Accounting Standards Update ("ASU") 2014-09 Revenue from Contracts with Customers (ASC 606) and all subsequent ASUs that modified ASC 606. ASC 606 provides that an entity should recognize revenue to depict the transfer of promised goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Interest income, net securities gains (losses) and income from bank-owned life insurance are not included within the scope of ASC 606. For the revenue streams in the scope of ASC 606, service charges on deposits and electronic banking fees, there are no significant judgments related to the amount and timing of revenue recognition. All of the Bank s in scope revenue from contracts with customers is recognized within other noninterest income. Deposit Services. The Bank generates revenues through fees charged to depositors related to deposit account maintenance fees, overdrafts, ATM fees, wire transfers and additional miscellaneous services provided at the request of the depositor. For deposit-related services, revenue is recognized when performance obligations are satisfied, which is, generally, at a point in time. F-14 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Reclassifications Certain amounts in the June 30, 2021 financial statements have been reclassified to conform to the presentation used as of June 30, 2020. Note 2: Future Change in Accounting Principle The FASB issued ASU No. 2016- 13, Financial Instruments—Credit Losses (Topic 326). The ASU introduced a new credit loss model, the current expected credit loss model ("CECL"), which requires earlier recognition of credit losses, while also providing additional transparency about credit risk. The CECL model utilizes a lifetime "expected credit loss" measurement objective for the recognition of credit losses for loans, held-to-maturity securities and other receivables at the time the financial asset is originated or acquired. The expected credit losses are adjusted each period for changes in expected lifetime credit losses. For available-for-sale securities where fair value is less than cost, credit-related impairment, if any, will be recognized in an allowance for credit losses and adjusted each period for changes in expected credit risk. This model replaces the existing impairment models, which generally require that a loss be incurred before it is recognized. The CECL model represents a significant change from existing practice and may result in material changes to the Bank s accounting for financial instruments. The Bank is evaluating the effect ASU 2016-13 will have on its financial statements and related disclosures. The impact of the ASU will depend upon the state of the economy and the nature of our portfolios at the date of adoption. The new standard is effective for the Bank for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years. F-15 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Note 3: Debt Securities The amortized cost and fair values, together with gross unrealized gains and losses of securities are as follows: Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Approximate Fair Value (Unaudited) Available-for-sale Securities: December 31, 2021 Mortgage-backed Government Sponsored Enterprises ("GSEs") $14,317,087 $89,262 $210,123 $14,196,226 State and political subdivisions 4,133,330 22,088 41,473 4,113,945 $18,450,417 $111,350 $251,596 $18,310,171 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Approximate Fair Value Available-for-sale Securities: June 30, 2021 U.S. Government agencies $9,999,088 $280 $92,068 $9,907,300 Mortgage-backed Government Sponsored Enterprises (GSEs) 15,085,673 142,693 131,065 15,097,301 State and political subdivisions 3,536,636 23,378 38,195 3,521,819 $28,621,397 $166,351 $261,328 $28,526,420 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Approximate Fair Value Available-for-sale Securities: June 30, 2020 U.S. Government agencies $4,000,000 $3,210 $- $4,003,210 Mortgage-backed Government Sponsored Enterprises (GSEs) 6,528,982 111,666 17,837 6,622,811 State and political subdivisions 427,864 9,911 - 437,775 $10,956,846 $124,787 $17,837 $11,063,796 F-16 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 The amortized cost and fair value of available-for-sale securities at December 31, 2021 and June 30, 2021, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties: Amortized Fair Cost Value (Unaudited) December 31, 2021 Within one year $- $- One to five years - - Five to ten years 953,136 948,359 After ten years 3,180,194 3,165,586 4,133,330 4,113,945 Mortgage-backed GSEs 14,317,087 14,196,226 Totals $18,450,417 $18,310,171 Amortized Fair Cost Value June 30, 2021 Within one year $- $- One to five years 4,999,088 4,970,741 Five to ten years 5,956,132 5,894,734 After ten years 2,580,504 2,563,644 13,535,724 13,429,119 Mortgage-backed GSEs 15,085,673 15,097,301 Totals $28,621,397 $28,526,420 The carrying value of securities pledged as collateral, to secure public deposits and for other purposes, was approximately $5,105,000, $2,022,000 and $430,000 at December 31, 2021 (unaudited), June 30, 2021 and 2020, respectively. Proceeds from sales of securities totaled $9,708,000 (unaudited) during the six months ended December 31, 2021. Such sales resulted in realized losses totaling $291,000 (unaudited). There were no sales of securities during the fiscal years ended June 30, 2021 and 2020. F-17 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Certain investments in debt securities are reported in the financial statements at an amount less than their historical cost. At December 31, 2021 (unaudited), 12 of 35 mortgage-backed GSEs and 5 of 10 state and political subdivisions securities contained unrealized losses. At June 30, 2021, 9 of 10 U.S. Government agency securities, 11 of 35 mortgage-backed GSEs and 4 of 8 state and political subdivisions securities contained unrealized losses. At June 30, 2020, 8 of 24 mortgage-backed GSEs contained unrealized losses. Total fair value of these investments at December 31, 2021 (unaudited), June 30, 2021 and 2020, was $12,353,000, $20,459,000 and $1,293,000, which is approximately 67 percent, 72 percent and 12 percent, respectively, of the fair value of the Bank s total investment portfolio. These declines primarily resulted from changes in market interest rates. Based on evaluation of available evidence, including recent changes in market interest rates and information obtained from regulatory filings, management believes the declines in fair value for these securities are temporary. Should the impairment of any of these securities become other than temporary, the cost basis of the investment will be reduced and the resulting loss recognized in net income in the period the other-than-temporary impairment is identified. The following tables show the Bank s investments gross unrealized losses and fair value of the Bank s investments with unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by investment class and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2021, June 30, 2021 and June 30, 2020: December 31, 2021 Less than 12 Months 12 Months or More Total Description of Securities Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses (Unaudited) Mortgage-backed Government Sponsored Enterprises (GSEs) $8,402,363 $150,091 $1,758,340 $60,032 $10,160,703 $210,123 State and political subdivisions 2,192,206 41,473 - - 2,192,206 41,473 Total temporarily impaired securities $10,594,569 $191,564 $1,758,340 $60,032 $12,352,909 $251,596 June 30, 2021 Less than 12 Months 12 Months or More Total Description of Securities Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses U.S. Government agencies $8,907,020 $92,068 $- $- $8,907,020 $92,068 Mortgage-backed Government Sponsored Enterprises (GSEs) 9,571,406 130,703 89,672 362 9,661,078 131,065 State and political subdivisions 1,890,798 38,195 - - 1,890,798 38,195 Total temporarily impaired securities $20,369,224 $260,966 $89,672 $362 $20,458,896 $261,328 F-18 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 June 30, 2020 Less than 12 Months 12 Months or More Total Description of Securities Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Mortgage-backed Government Sponsored Enterprises (GSEs) $1,292,793 $17,837 $- $- $1,292,793 $17,837 U.S. Government Agencies and State and Political Subdivisions Unrealized losses on these securities have not been recognized because the issuers bonds are of high credit quality, values have only been impacted by changes in interest rates since the securities were purchased, and the Bank has the intent and ability to hold the securities for the foreseeable future. The fair value is expected to recover as the bonds approach the maturity date. Because the decline in market value was attributable to changes in interest rates, and not credit quality, and because the Bank typically does not intend to sell the investments and it is not more likely than not the Bank will be required to sell the investments before recovery of their amortized cost basis, which may be maturity, the Bank does not consider those investments to be other-than-temporarily impaired at December 31, 2021, (unaudited) and June 30, 2021. Mortgage-backed GSEs The unrealized losses on the Bank s investment in residential mortgage-backed government sponsored enterprises were caused primarily by changes in interest rates. The Bank expects to recover the amortized cost basis over the term of the securities. Because the decline in market value is attributable to changes in interest rates, and not credit quality, and because the Bank typically does not intend to sell the investments and it is not more likely than not the Bank will be required to sell the investments before recovery of their amortized cost basis, which may be maturity, the Bank does not consider those investments to be other-than-temporarily impaired at December 31, 2021 (unaudited), June 30, 2021 and June 30, 2020. F-19 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Note 4: Loans and Allowance for Loan Losses Categories of loans were as follows: December 31, June 30, 2021 2021 2020 (Unaudited) Commercial real estate $7,450,559 $6,547,889 $6,377,461 Residential real estate 63,316,975 61,355,004 56,417,137 Agricultural real estate 3,303,125 2,976,060 2,633,296 Construction and land real estate 4,603,314 4,877,306 4,069,818 Commercial and industrial 325,522 341,973 361,293 Home equity line of credit ("HELOC") 378,570 205,888 241,846 Consumer 675,763 774,906 808,552 Total loans 80,053,828 77,079,026 70,909,403 Less: Undisbursed loans in process 2,408,419 2,479,669 1,225,272 Net deferred loan costs, premiums and discounts 2,738 (7,734) (34,524) Allowance for loan losses 222,884 222,884 222,884 Net loans $77,419,787 $74,384,207 $69,495,771 The following tables present the activity in the allowance for loan losses based on portfolio segment for the six months ended December 31, 2021 and 2020 and the years ended June 30, 2021 and 2020. Six Months Ended December 31, 2021 (Unaudited) Real Estate Construction Commercial Commercial Residential Agricultural & Land & Industrial HELOC Consumer Total Allowance for loan losses: Balance, July 1, 2021 $27,506 $176,498 $8,334 $7,723 $1,437 $577 $809 $222,884 Provision (credit) for loan losses 1,516 (8,460) 4,532 2,276 (169) 406 (101) - Charge-offs - - - - - - - - Recoveries - - - - - - - - Balance, December 31, 2021 $29,022 $168,038 $12,866 $9,999 $1,268 $983 $708 $222,884 F-20 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Six Months Ended December 31, 2020 (Unaudited) Real Estate Construction Commercial Commercial Residential Agricultural & Land & Industrial HELOC Consumer Total Allowance for loan losses: Balance, July 1, 2020 $18,469 $187,308 $8,830 $7,828 $114 $80 $255 $222,884 Provision (credit) for loan losses 12,197 (17,348) 3,694 (592) 1,127 561 361 - Charge-offs - - - - - - - - Recoveries - - - - - - - - Balance, December 31, 2020 $30,666 $169,960 $12,524 $7,236 $1,241 $641 $616 $222,884 Year Ended June 30, 2021 Real Estate Construction Commercial Commercial Residential Agricultural & Land & Industrial HELOC Consumer Total Allowance for loan losses: Balance, July 1, 2020 $18,469 $187,308 $8,830 $7,828 $114 $80 $255 $222,884 Provision (credit) for loan losses 9,037 (10,810) (496) (105) 1,323 497 554 - Charge-offs - - - - - - - - Recoveries - - - - - - - - Balance, June 30, 2021 $27,506 $176,498 $8,334 $7,723 $1,437 $577 $809 $222,884 June 30, 2020 Real Estate Construction Commercial Commercial Residential Agricultural & Land & Industrial HELOC Consumer Total Allowance for loan losses: Balance, July 1, 2019 $11,356 $197,056 $7,779 $5,493 $- $- $1,200 $222,884 Provision (credit) for loan losses 7,113 (9,748) 1,051 2,335 114 80 (945) - Charge-offs - - - - - - - - Recoveries - - - - - - - - Balance, June 30, 2020 $18,469 $187,308 $8,830 $7,828 $114 $80 $255 $222,884 F-21 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 The following tables present the balance in the allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method as of December 31, 2021 and June 30, 2021 and 2020: December 31, 2021 (Unaudited) Real Estate Construction Commercial Commercial Residential Agricultural and Land & Industrial HELOC Consumer Total Allowance for loan losses: Ending balance, individually evaluated for impairment $- $4,037 $- $- $- $- $- $4,037 Ending balance, collectively evaluated for impairment $29,022 $164,001 $12,866 $9,999 $1,268 $983 $708 $218,847 Loans: Ending balance $7,450,559 $63,316,975 $3,303,125 $4,603,314 $325,522 $378,570 $675,763 $80,053,828 Ending balance; individually evaluated for impairment $- $161,280 $- $- $- $- $- $161,280 Ending balance; collectively evaluated for impairment $7,450,559 $63,155,695 $3,303,125 $4,603,314 $325,522 $378,570 $675,763 $79,892,548 June 30, 2021 Real Estate Construction Commercial Commercial Residential Agricultural and Land & Industrial HELOC Consumer Total Allowance for loan losses: Ending balance, individually evaluated for impairment $- $5,169 $- $- $- $- $- $5,169 Ending balance, collectively evaluated for impairment $27,506 $171,329 $8,334 $7,723 $1,437 $577 $809 $217,715 Loans: Ending balance $6,547,889 $61,355,004 $2,976,060 $4,877,306 $341,973 $205,888 $774,906 $77,079,026 Ending balance; individually evaluated for impairment $- $176,746 $- $- $- $- $- $176,746 Ending balance; collectively evaluated for impairment $6,547,889 $61,178,258 $2,976,060 $4,877,306 $341,973 $205,888 $774,906 $76,902,280 F-22 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 June 30, 2020 Real Estate Construction Commercial Commercial Residential Agricultural and Land & Industrial HELOC Consumer Total Ending balance, individually evaluated for impairment $- $- $- $- $- $- $- $- Ending balance, collectively evaluated for impairment $18,469 $187,308 $8,830 $7,828 $114 $80 $255 $222,884 Loans: Ending balance $6,377,461 $56,417,137 $2,633,296 $4,069,818 $361,293 $241,846 $808,552 $70,909,403 Ending balance; individually evaluated for impairment $- $44,552 $- $- $- $- $- $44,552 Ending balance; collectively evaluated for impairment $6,377,461 $56,372,585 $2,633,296 $4,069,818 $361,293 $241,846 $808,552 $70,864,851 The Bank has adopted a standard loan grading system for all loans. Loan grades are numbered 1 through 8. Grades 1 through 3 are considered satisfactory grades. The grade of 4, Monitor, represents loans requiring more than normal attention. The grade of 5, Special Mention, represents loans of lower quality and is considered criticized. The grades of 6, or Substandard, and 7, or Doubtful, refer to loans that are classified. Pass (1-3) Loans of reasonable credit strength and repayment ability providing a satisfactory credit risk. Monitor (4) Loans requiring more than normal attention resulting from underwriting weaknesses as to repayment terms, loan structure, financial and/or documentation exceptions. Special Mention (5) Loans which may include the characteristics of the Monitor classification, but that also reflect additional problems that need to be addressed by both the lender and the borrower. Substandard (6) Loans which may include the characteristics of the Special Mention classification, but also reflects financial and other problems that might result in some loss at a future date and/or reliance upon collateral for ultimate collection. Doubtful (7) Loans for which some loss is anticipated, but the timing and amount of the loss is not definite. Loss (8) Loans considered non-bankable assets which may or may not have some salvage value. F-23 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Risk characteristics of each loan portfolio segment are described as follows: Commercial Real Estate These loans include loans on residential real estate secured by property with five or more units. The main risks are changes in the value of the collateral, ability of borrowers to collect rents, vacancy and changes in the tenants' employment status. Management specifically considers unemployment and changes in real estate values in the Bank's market area. Residential Real Estate These loans include first liens and junior liens on 1-4 family residential real estate (both owner and non-owner occupied). The main risks for these loans are changes in the value of the collateral and stability of the local economic environment and its impact on the borrowers' employment. Management specifically considers unemployment and changes in real estate values in the Bank's market area. Agriculture Real Estate These loans include loans on farm ground, vacant land for development and loans on commercial real estate. The main risks are changes in the value of the collateral and changes in the economy or borrowers' business operations. Management specifically considers unemployment and changes in real estate values in the Bank's market area. Construction and Land Real Estate These loans include construction loans for 1-4 family residential and commercial properties (both owner and non-owner occupied) and first liens on land. The main risks for construction loans include uncertainties in estimating costs of construction and in estimating the market value of the completed project. The main risks for land loans are changes in the value of the collateral and stability of the local economic environment. Management specifically considers unemployment and changes in real estate values in the Bank's market area. Commercial and Industrial The commercial and industrial portfolio includes loans to commercial customers for use in financing working capital needs, equipment purchases and expansions. The loans in this category are repaid primarily from the cash flow of a borrower s principal business operation. Credit risk in these loans is driven by creditworthiness of the borrower and the economic conditions that impact the cash flow stability from business operations. HELOC These loans are generally secured by owner-occupied 1-4 family residences. The main risks for these loans are changes in the value of the collateral and stability of the local economic environment and its impact on the borrowers' employment. Management specifically considers unemployment and changes in real estate values in the Bank's market area. F-24 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Consumer Loans These loans include vehicle loans, share loans and unsecured loans. The main risks for these loans are the depreciation of the collateral values (vehicles) and the financial condition of the borrowers. Major employment changes are specifically considered by management. Information regarding the credit quality indicators most closely monitored for other than residential real estate loans by class as of December 31, 2021, (unaudited), June 30, 2021 and June 30, 2020, follows: Pass Monitor Special Mention Substandard Doubtful Total December 31, 2021 Commercial real estate $7,261,380 $189,179 $- $- $- $7,450,559 Agricultural real estate 3,048,704 254,421 - - - 3,303,125 Construction and land real estate 88,968 4,473,739 - 40,607 - 4,603,314 Commercial and industrial 309,744 15,778 - - - 325,522 Totals $10,708,796 $4,933,117 $- $40,607 $- $15,682,520 June 30, 2021 Commercial real estate $6,343,078 $204,811 $- $- $- $6,547,889 Agricultural real estate 2,721,639 254,421 - - - 2,976,060 Construction and land real estate 54,857 4,777,224 - 45,225 - 4,877,306 Commercial and industrial 314,673 27,300 - - - 341,973 Totals $9,434,247 $5,263,756 $- $45,225 $- $14,743,228 June 30, 2020 Commercial real estate $6,141,622 $235,839 $- $- $- $6,377,461 Agricultural real estate 2,357,955 275,341 - - - 2,633,296 Construction and land real estate 248,000 3,775,141 - 46,677 - 4,069,818 Commercial and industrial 361,293 - - - - 361,293 Totals $9,108,870 $4,286,321 $- $46,677 $- $13,441,868 F-25 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 The following tables present the credit risk profile of the Bank s residential real estate loan portfolio based on internal rating category and payment activity as of December 31, 2021, June 30, 2021 and 2020: December 31, 2021 (Unaudited) Real Estate Construction Commercial Commercial Residential Agricultural and Land & Industrial HELOC Consumer Total Performing $7,450,559 $63,155,695 $3,303,125 $4,603,314 $325,522 $378,570 $675,763 $79,892,548 Nonperforming - 161,280 - - - - - 161,280 Total $7,450,559 $63,316,975 $3,303,125 $4,603,314 $325,522 $378,570 $675,763 $80,053,828 June 30, 2021 Real Estate Construction Commercial Commercial Residential Agricultural and Land & Industrial HELOC Consumer Total Performing $6,547,889 $61,172,131 $2,976,060 $4,877,306 $341,973 $205,888 $774,906 $76,896,153 Nonperforming - 182,873 - - - - - 182,873 Total $6,547,889 $61,355,004 $2,976,060 $4,877,306 $341,973 $205,888 $774,906 $77,079,026 June 30, 2020 Real Estate Construction Commercial Commercial Residential Agricultural and Land & Industrial HELOC Consumer Total Performing $6,377,461 $56,372,585 $2,633,296 $4,069,818 $361,293 $241,846 $808,552 $70,864,851 Nonperforming - 44,552 - - - - - 44,552 Total $6,377,461 $56,417,137 $2,633,296 $4,069,818 $361,293 $241,846 $808,552 $70,909,403 The Bank evaluates the loan risk grading system definitions and allowance for loan losses methodology on an ongoing basis. No significant changes were made to either during the six months ended December 31, 2021, (unaudited) or the years ended June 30, 2021 and June 30, 2020. F-26 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 The following tables present the Bank s loan portfolio aging analysis of the recorded investment in loans as of December 31, 2021, June 30, 2021 and 2020: December 31, 2021 (Unaudited) Greater Than Total Loans > 30-59 Days 60-89 Days 90 Days Total Total Loans 90 Days & Past Due Past Due Past Due Past Due Current Receivable Accruing Commercial real estate $- $- $- $- $7,450,559 $7,450,559 $ - Residential real estate 1,005,688 412,579 45,035 1,463,302 61,853,673 63,316,975 - Agricultural real estate - - - - 3,303,125 3,303,125 - Construction and land real estate - - - - 4,603,314 4,603,314 - Commercial and industrial - - - - 325,522 325,522 - HELOC - - - - 378,570 378,570 - Consumer - - - - 675,763 675,763 - Total $1,005,688 $412,579 $45,035 $1,463,302 $78,590,526 $80,053,828 $- June 30, 2021 Greater Than Total Loans > 30-59 Days 60-89 Days 90 Days Total Total Loans 90 Days & Past Due Past Due Past Due Past Due Current Receivable Accruing Commercial real estate $ - $- $- $- $6,547,889 $6,547,889 $- Residential real estate - 99,563 176,746 276,309 61,078,695 61,355,004 97,490 Agricultural real estate - - - - 2,976,060 2,976,060 - Construction and land real estate - - - - 4,877,306 4,877,306 - Commercial and industrial - - - - 341,973 341,973 - HELOC - - - - 205,888 205,888 - Consumer - - - - 774,906 774,906 - Total $- $99,563 $176,746 $276,309 $76,802,717 $77,079,026 $97,490 June 30, 2020 Greater Than Total Loans > 30-59 Days 60-89 Days 90 Days Total Total Loans 90 Days & Past Due Past Due Past Due Past Due Current Receivable Accruing Commercial real estate $ - $- $- $- $6,377,461 $6,377,461 $- Residential real estate - 51,256 44,552 95,808 56,321,329 56,417,137 35,400 Agricultural real estate - - - - 2,633,296 2,633,296 - Construction and land real estate - - - - 4,069,818 4,069,818 - Commercial and industrial - - - - 361,293 361,293 - HELOC - - - - 241,846 241,846 - Consumer - - - - 808,552 808,552 - Total $- $51,256 $44,552 $95,808 $70,005,043 $70,909,403 $35,400 F-27 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Impaired loans information as of December 31, 2021,June 30, 2021 and 2020, and for the six months ended December 31, 2021 and 2020, and for the years ended June 30, 2021 and 2020, is as follows: Unpaid Interest Recorded Balance Principal Balance Specific Allowance Average Balance Income Recognized December 31, 2021 (Unaudited) Loans without a specific valuation allowance: Residential real estate $96,918 $96,918 $- $99,723 $2,482 Loans with a specific valuation allowance: Residential real estate 64,362 64,362 4,037 64,930 2,189 Totals $161,280 $161,280 $4,037 $164,653 $4,671 June 30, 2021 Loans without a specific valuation allowance: Residential real estate $111,252 $111,252 $- $112,957 $5,807 Loans with a specific valuation allowance: Residential real estate 65,494 65,494 5,169 65,823 3,491 Totals $176,746 $176,746 $5,169 $178,780 $9,298 June 30, 2020 Loans without a specific valuation allowance: Residential real estate $44,552 $44,552 $- $46,159 $1,418 Impaired loans information for the six months ended December 31, 2020, is as follows: Interest Average Balance Income Recognized (Unaudited) December 31, 2020 Loans without a specific valuation allowance: Residential real estate $83,597 $1,265 F-28 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Nonaccrual loans at December, 31, 2021, June 30, 2021 and June 30, 2020, were as follows: December 31, June 30, 2021 2021 2020 (Unaudited) Commercial real estate $- $- $- Residential real estate 161,280 85,384 9,152 Agricultural real estate - - - Construction and land real estate - - - Commercial and industrial - - - Home equity line of credit (HELOC) - - - Consumer - - - Total nonaccrual $161,280 $85,384 $9,152 There were no loans modified in a troubled debt restructuring during the six months ended December 31, 2021 (unaudited) and during the years ending June 30, 2021 and 2020. There were no troubled debt restructurings modified in the past 12 months that subsequently defaulted during the six months ended December 31, 2021 (unaudited) and for the years ended June 30, 2021 and 2020. Note 5:Premises and Equipment Major classifications of premises and equipment, stated at cost, at December 31, 2021, June 30, 2021 and 2020, are as follows: December 31, June 30, 2021 2021 2020 (Unaudited) Land $558,183 $558,183 $558,183 Buildings and improvements 1,321,608 1,322,778 1,320,195 Furniture and equipment 1,059,045 1,059,607 1,024,721 IT equipment and improvements 45,608 35,398 31,865 2,984,444 2,975,966 2,934,964 Less accumulated depreciation 1,588,660 1,554,800 1,483,864 Net premises and equipment $1,395,784 $1,421,166 $1,451,100 Depreciation expense was approximately $34,000 and $37,000 (unaudited), for the six months ended December 31, 2021 and 2020, respectively, and $71,000 and $78,000 for the years ended June 30, 2021 and 2020, respectively. F-29 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Note 6:Time Deposits Time deposits in denominations of $250,000 or more were $3,164,000, $2,594,000 and $3,435,000 at December 31, 2021 (unaudited), June 30, 2021 and 2020, respectively. At December 31, 2021 and June 30, 2021, the scheduled maturities of time deposits were as follows: December 31, June 30, 2021 2021 (Unaudited) One year or less $17,701,709 $15,884,750 Over one year to two years 6,292,637 9,234,813 Over two years to three years 3,058,133 3,251,677 Over three years to four years 6,489,556 6,220,560 Over four year to five years 3,699,504 3,894,394 Thereafter - 15,066 $37,241,539 $38,501,260 Note 7: Borrowings The Bank had no Federal Home Loan Bank (FHLB) advances outstanding as of December 31, 2021, (unaudited) June 30, 2021, or June 30, 2020. The Bank has made a collateral pledge to the FHLB consisting of all shares of FHLB stock owned by the Bank and a blanket pledge of approximately $76,516,000 (unaudited), $70,433,000 and $63,032,000 of its qualifying mortgage assets as of December 31, 2021, June 30, 2021 and 2020, respectively. Based on this collateral, the Bank is eligible to borrow up to a total of approximately $44,084,000 (unaudited) and $38,436,000 as of December 31, 2021 and June 30, 2021, respectively. In addition, during December 2021, the Bank implemented an agreement providing for $6,000,000 in borrowings available under a Cash Management Advance from the FHLB, and no amounts were outstanding at December 31, 2021. F-30 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Note 8: Income Taxes The provision for income taxes includes these components: For the Six Months Ended For the Year Ended December 31, June 30, 2021 2020 2021 2020 (Unaudited) Taxes currently payable $ (30,146 ) $ 22,953 $ 52,389 $ 82,580 Deferred income taxes (7,300 ) (8,093 ) (17,166 ) (5,091 ) Income tax expense (benefit) $ (37,446 ) $ 14,860 $ 35,223 $ 77,489 A reconciliation of the federal income tax expense at the statutory rate to the Bank s actual income tax expense is shown below: For the Six Months Ended For the Year Ended December 31, June 30, 2021 2020 2021 2020 (Unaudited) Computed at statutory rate (21%) $(30,500) $27,319 $61,527 $102,624 Increase (decrease) resulting from: Bank-owned life insurance (11,500) (13,099) (23,276) (25,986) Other 4,554 640 (3,028) 851 Actual income tax expense (benefit) $(37,446) $14,860 $35,223 $77,489 F-31 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 The composition of the Bank s net deferred tax liability at December 31, 2021, June 30, 2021 and 2020, is as follows: December 31, June 30, 2021 2021 2020 (Unaudited) Deferred tax assets Allowance for loan losses $46,806 $46,806 $46,806 Unrealized losses on available-for-sale securities 29,452 19,945 - Deferred compensation 39,119 37,643 35,955 Deferred tax assets 115,377 104,394 82,761 Deferred tax liabilities Depreciation (39,001) (43,201) (53,092) Federal Home Loan Bank stock dividends (151,242) (151,242) (151,242) Unrealized gains on available-for-sale securities - - (22,460) Deferred loan fees - (1,624) (7,211) Deferred tax liabilities (190,243) (196,067) (234,005) Net deferred tax liability $(74,866) $(91,673) $(151,244) Retained earnings at each of December 31, 2021 (unaudited), June 30, 2021 and 2020, includes approximately $1.8 million for which no deferred federal income tax liability has been recognized. This amount represents an allocation of income to bad debt deductions for tax purposes only. Reduction of amounts so allocated for purposes other than tax bad debt losses or adjustments arising from carryback of net operating losses would create income for tax purposes only, which would be subject to the then-current corporate income tax rate. The deferred income tax liability on the preceding amount that would have been recorded if it was expected to reverse into taxable income in the foreseeable future was approximately $607,000 at December 31, 2021 (unaudited), June 30, 2021 and 2020. F-32 Van Wert Federal Savings Bank Notes to Financial Statements December 31, 2021 and 2020 (Unaudited) and June 30, 2021 and 2020 Note 9:Regulatory Matters The Bank is subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Bank s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank s assets, liabilities and certain off-balance-sheet items as calculated under U.S. GAAP reporting requirements and regulatory capital standards. The Bank s capital amounts and classification are also
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diff --git a/parsed_sections/prospectus_summary/2022/WALDW_waldencast_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/WALDW_waldencast_prospectus_summary.txt
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2022/WLSS_welsis_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/WLSS_welsis_prospectus_summary.txt
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@@ -0,0 +1,14 @@
+PROSPECTUS SUMMARY
+
+ 
+
+You should read the following summary together with the more detailed
+business information, financial statements and related notes that appear elsewhere in this prospectus. In this prospectus, unless the
+context otherwise denotes, references to "we," "us," "our" and "Welsis Corp." are to Welsis Corp.
+
+ 
+
+You should rely only on the information contained
+in this prospectus. We have not authorized any other person to provide you with different information. This prospectus is neither an offer
+to sell, nor is it seeking an offer to buy, these securities in any state where the offer or sale is not permitted. The information in
+this prospectus is complete and accurate as of the date on the front cover, but the information may have changed since that date.
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diff --git a/parsed_sections/prospectus_summary/2022/WYTC_wytec_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/WYTC_wytec_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2022/XPOF_xponential_prospectus_summary.txt b/parsed_sections/prospectus_summary/2022/XPOF_xponential_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights selected information that is presented in greater detail elsewhere in this prospectus and the documents incorporated by reference in this prospectus. This summary does not contain all of the information you should consider before investing in our Class A common stock. You should read this entire prospectus carefully, including the information incorporated by reference in this prospectus, and any free writing prospectus prepared by us or on our behalf, including the section entitled Risk Factors in this prospectus, the documents incorporated by reference in this prospectus and the consolidated financial statements and related notes thereto incorporated by reference in this prospectus, before deciding whether to invest in our Class A common stock. Xponential Fitness, Inc. Xponential Fitness is the largest global franchisor of boutique fitness brands. We offer a diversified platform of ten brands spanning across verticals including Pilates, indoor cycling, barre, stretching, rowing, dancing, boxing, running, functional training and yoga. Our franchisees offer energetic, accessible and personalized workout experiences led by highly qualified instructors in studio locations across 48 U.S. states, the District of Columbia and Canada and through master franchise or international expansion agreements in ten additional countries. Our portfolio of brands includes Club Pilates, the largest Pilates brand in the United States; CycleBar, the largest indoor cycling brand in the United States; StretchLab, a concept offering one-on-one and group stretching services; Row House, the largest franchised indoor rowing brand in the United States; AKT, a dance-based cardio workout combining toning, interval and circuit training; YogaSix, the largest franchised yoga brand in the United States; Pure Barre, a total body workout that uses the ballet barre to perform small isometric movements, and the largest Barre brand in the United States; Stride, a treadmill-based cardio and strength training concept; Rumble, a boxing-inspired full-body workout; and BFT, a functional training and strength-based program. The foundation of our business is built on strong partnerships with franchisees. Our business model is straightforward: we license our boutique studio operations, share our business processes and branding with franchisees, and in exchange charge royalties and other fees for our services. We are highly focused on providing franchisees with extensive support to help maximize their performance and enhance their return on investment. In turn, this partnership accelerates our growth and increases our profitability as a result of the royalties we generate on franchisees sales. We encourage our franchisees to follow a membership-based model, which generates recurring, predictable revenues for both us and our franchisees. We believe our unique combination of a scaled multi-brand offering, resilient franchise model with strong unit economics and integrated platform has enabled us to build our leading market position in the large and growing U.S. boutique fitness industry. We are able to improve our operating leverage as we grow the number of studios operating under our brand umbrellas, given that our existing infrastructure can scale across a larger system with minimal incremental costs. Table of Contents Our Market Leading Brand Portfolio Largest Pilates brand in the United States, created with the vision to make Pilates more accessible, approachable, and welcoming to everyone. 693 Studios Open 1,060 Licenses Sold Largest barre brand in the United States, offers an effective, low-impact workout for all ages and fitness levels. 612 Studios Open 734 Licenses Sold Largest indoor cycling brand in the United States, offering an inclusive low-impact/high intensity indoor cycling experience for all ages and experience levels. 249 Studios Open 516 Licenses Sold First to offer 1x1 assisted stretching classes. Highly complementary with our other brands. 151 Studios Open 570 Licenses Sold Largest rowing brand in the United States, offering a full body/low impact workout which has revolutionized the way people view indoor rowing. 91 Studios Open 320 Licenses Sold Largest franchised yoga brand in the United States, dedicated to the evolution and modernization of yoga. 131 Studios Open 529 Licenses Sold Boxing-based concept offering a 10-round, high energy cardio workout split between boxing drills and resistance training. 14 Studios Open 201 Licenses Sold Dance-based cardio concept combining dance, intervals and strength training. 28 Studios Open 112 Licenses Sold Treadmill-based cardio and strength workout, offering coached interval running classes for all fitness levels. 10 Studios Open 88 Licenses Sold Community-based 50-minute functional, high-energy strength, cardio and conditioning. 151 Studios Open 294 Licenses Sold Note: Global studio counts and licenses sold globally as of December 31, 2021. Table of Contents We carefully built the Xponential Fitness brand portfolio through a series of acquisitions, targeting select health and wellness verticals. In curating our portfolio, we identified brands with exceptional programming and a loyal consumer base which we believed would benefit from our operational expertise, franchising experience and scaled platform. With over 250 years of collective industry experience, our management team and brand presidents are the driving force behind our operational excellence. We have established a proven operational model (the Xponential Playbook ) that helps franchisees generate compelling studio economics. This model has allowed us to provide extensive support to franchisees, particularly during the COVID-19 pandemic. The key pillars of our Xponential Playbook include: optimizing the studio prototype and investment cost; thoroughly vetting franchisee candidates; real estate identification, site selection, studio build-out and design assistance; comprehensive pre-opening support, including membership sales, marketing support, employee training and programming development; detailed studio-level operational framework and best practices; intensive instructor and studio-level management training; our robust digital platform and XPASS offerings that allow franchisees to generate incremental revenue; data-driven analytical tools to support marketing strategies, member acquisition and retention; sophisticated technology systems, including uniform point-of-sale and reporting systems, to drive studio-level performance; centralized model capable of providing resources to franchisees in the event of exceptional crises, such as the COVID-19 pandemic; and ongoing monitoring and support to promote success. The Xponential Playbook is designed to help franchisees achieve compelling Average Unit Volumes ( AUVs ), strong operating margins and an attractive return on their invested capital. Studios are generally designed to be between 1,500 and 2,500 square feet in size, depending on the brand. The smaller box format contributed to a relatively low average initial franchisee investment of approximately $350,000 in 2021 and 2020. By utilizing the Xponential Playbook, our model is designed to generate, on average, an AUV of approximately $500,000 in year two of operations and studio-level operating margins ranging between 25% and 30%, resulting in an unlevered cash-on-cash return of approximately 40%. We believe our integrated, centralized platform is a unique competitive advantage in the boutique fitness industry and enables us to accelerate growth and enhance operating margins. Our multi-brand offering results in higher franchisee lead flow and conversion, which lowers franchisee acquisition costs. Existing franchisees also serve as an embedded pipeline for continued expansion across our brands. As a result of our scale, we benefit from greater access to real estate and favorable vendor relationships. Additionally, we leverage shared corporate services across franchise sales, real estate, supply chain, merchandising, information technology, finance, accounting and legal. As an integrated platform, we utilize technology to provide improved functionality, drive Table of Contents efficiency and access compelling data across our brands. Our robust XPLUS digital platform, which features digital workout content from across our brands, as well as our cross-brand XPASS subscription offering, are important examples of our ability to cross-sell our individual brands, offering members variety and flexibility to work out both in-studio and at-home, across modalities and geographies, thereby driving increased member interest and retention. We also benefit from knowledge sharing and best practices across the portfolio. We believe that we are in the early stages of unlocking the power of our platform and driving long-term growth. As a franchisor, we benefit from multiple highly predictable and recurring revenue streams that enable us to scale our franchised studio base in a capital efficient manner. Our system has significant embedded growth based on already-sold licenses for studios that have not yet opened. As of December 31, 2021, franchisees were contractually obligated to open an additional 1,806 studios in North America. Converting our current pipeline of licenses sold to open studios in North America would nearly double our existing franchised studio base. Based on our internal and third-party analyses by Buxton Company, we estimate that franchisees could have a total of approximately 7,900 studios in the United States alone. Internationally, we partner with experienced master franchisees to deploy an asset light global expansion strategy. As of December 31, 2021, master franchisees were contractually obligated to sell licenses to franchisees to open an additional 956 studios in ten countries internationally pursuant to master franchisee agreements ( MFAs ). As part of the acquisition of BFT, we entered into an MFA with the sellers of BFT. As of December 31, 2021, there were 149 open BFT studios in Australia, New Zealand and Singapore, and an additional 140 licenses sold. Highlights of our platform s recent financial results and growth include: grew the number of global open studios from 1,796 as of December 31, 2020 to 2,130 as of December 31, 2021, representing an increase of 19%; grew global franchise licenses sold from 3,469 as of December 31, 2020 to 4,424 as of December 31, 2021, representing an increase of 28%; grew system-wide sales from $443 million in 2020 to $710 million in 2021, representing an increase of 60%; grew same store sales from a decline of 34% in 2020 to positive 41% in 2021, which reflects a significant rebound of studio performance following the impact of the COVID-19 pandemic; grew run-rate AUV from $287,000 in the fourth quarter of 2020 to $446,000 in the fourth quarter of 2021, representing an increase of 55%; and acquired certain assets and rights to two additional brands in 2021, Rumble and BFT. All metrics above are presented on an adjusted basis to reflect historical information of the brands we acquired and therefore include time periods during which certain of the brands were operated by our predecessors. We acquired Club Pilates and CycleBar in September 2017, StretchLab in November 2017, Row House in December 2017, AKT in March 2018, YogaSix in July 2018, Pure Barre in October 2018, Stride in December 2018, Rumble in March 2021 and BFT in October 2021. As a result of the COVID-19 pandemic, our operations and the businesses of our franchisees were adversely affected beginning in March 2020 continuing through the remainder of 2020. With a majority of our studios closed in March and April of 2020, we were focused on re-directing our members and franchisees to our digital platform, thus helping our franchisees retain members and providing a tool for franchisees to preserve Table of Contents member relationships and generate revenue. As restrictions on indoor fitness classes were reduced in later 2020, franchisees in-studio operations began to recover. The adverse effects of the COVID-19 pandemic continued to abate through 2021, as vaccination rates in the United States increased substantially and restrictions were further reduced or eliminated in most states. As of December 31, 2021, we have seen our system surpass pre-COVID levels, with our franchisees member base 29% larger than it was as of December 31, 2019. With many consumers increasingly health conscious and either returning to their fitness communities or forming new fitness habits, we have experienced significant growth in the aftermath of the pandemic. Year ended December 31, 2021 Year ended December 31, 2020 North America International Global North America International Global Open Studios Open Studios (beginning of period) 1,714 82 1,796 1,472 38 1,510 New Studio Openings 240 94 334 242 44 286 Open Studios (end of period) 1,954 176 2,130 1,714 82 1,796 Franchise Licenses Sold (1) Franchise Licences Sold (total beginning of period) 3,275 194 3,469 3,010 109 3,119 New Franchise License Sales 787 168 955 265 85 350 Franchise Licences Sold (total end of period) 4,062 362 4,424 3,275 194 3,469 Studios Obligated to Open Internationally under MFA Gross Studios Obligated to Open under MFA 1,132 768 Less: Studios Opened under MFA 176 82 Remaining Studios Obligated to Open under MFA 956 686 Licenses Already Sold by Master Franchisees(2)(3) 184 110 (1) Global Franchise Licenses Sold are presented gross of terminations. (2) Net of two international license terminations. (3) Reflects the number of licenses for studios which have already been sold, but not yet opened, by master franchisees under MFAs. Table of Contents (1) Represents North American Studios. (1) Represents run-rate AUVs for North American studios open for 6+ months. Note: The above data is presented on an adjusted basis to reflect historical information of the brands we acquired and therefore includes time periods during which certain of the brands were operated by our predecessors. We acquired Club Pilates and CycleBar in September 2017, Stretch Lab in November 2017, Row House in December 2017, AKT in March 2018, Yoga Six in July 2018, Pure Barre in October 2018, Stride in December 2018, Rumble in March 2021 and BFT in October 2021. Our Industry We operate in the large and growing boutique fitness segment of the broader health and fitness club industry. Boutique fitness encompasses a social, supportive community of coaches and consumers engaging through class-based programming in small studio spaces (typically 1,500-2,500 square feet). A boutique fitness workout typically offers more customized programming and a more intensive experience complemented by increased levels of personal attention and guidance relative to a traditional health and fitness club. The U.S. boutique fitness market was estimated at $21.1 billion in 2019, according to an independent analysis we had commissioned from Frost & Sullivan. International Health, Racquet & Sportsclub Association ( IHRSA ) estimates that boutique fitness memberships grew more rapidly than the overall health and fitness club memberships between 2015 and 2019, with target boutique fitness consumers spending more and engaging more frequently than the average health and fitness club member in 2019. In 2019, IHRSA estimated the size of the global health and fitness club industry at $96.7 billion, with more than 205,000 clubs serving over 184 million members in 2019. Prior to the COVID-19 pandemic, the U.S. health and fitness club industry experienced annual growth for more than 21 consecutive years. As a result of the Table of Contents COVID-19 pandemic, the industry saw unprecedented declines in 2020 and 2021, with 2020 U.S. health and fitness club revenue declining by 58%, according to IHRSA. As of January 1, 2022, 30% of boutique fitness studios had closed permanently, according to IHRSA, which we believe presents an opportunity for Xponential to further penetrate new and existing markets, capturing displaced fitness consumers. As the largest franchisor in the boutique fitness industry, we saw continued strong growth during the COVID-19 pandemic. We opened 555 new studios globally between April 2020 and December 2021, including studios opened by Rumble and BFT. As of December 31, 2021, we have seen our system surpass pre-COVID levels, with our franchisees member base 29% larger than it was as of December 31, 2019. As COVID-19 pandemic restrictions ease, we believe pent-up demand for in-person fitness will spur a return to studios and gyms, propelling growth across the industry. IBISWorld estimates that the U.S. gym, health and fitness club industry will reach $36.6 billion in 2022. Frost & Sullivan estimates that the total addressable U.S. boutique fitness market will reach $22.1 billion in 2022 and will grow at a CAGR of approximately 5.8% between 2022 and 2025. According to IHRSA, approximately 95% of fitness consumers surveyed miss at least one aspect of physically being at their studio or gym, and 94% plan to return to the gym in some capacity. Consumers desire to return to their fitness communities and their increasing prioritization of healthy lifestyles has driven consistent growth in our franchisees membership base, with actively paying members and visitation rates increasing 70% and 50%, respectively, in the three months ended December 31, 2021 relative to the three months ended December 31, 2020. Our Competitive Strengths Diversified portfolio of leading boutique fitness brands. Our portfolio of ten diversified brands spans a variety of popular fitness and wellness verticals including Pilates, barre, cycling, stretching, rowing, yoga, boxing, dancing, running and functional training. We believe that our diversification represents a significant competitive advantage in a fragmented market comprised primarily of single-brand companies focused on an individual fitness or wellness vertical. The complementary nature of our brands allows our franchised studios to be located in close proximity to one another, providing variety and convenience to both consumers and franchisees. Our brands appeal to a broad range of consumers across ages, fitness levels and demographics and are positioned at accessible price points. The strength of our brands is highlighted by the numerous accolades they have received, with four brands (Club Pilates, Pure Barre, CycleBar and StretchLab) each being listed among Entrepreneur s 2022 Franchise 500 rankings and BFT being voted the 2020 APAC Franchise of the Year. We believe that our diversified brand offering expands our total addressable market and translates into increased use occasions for consumers, driving increased share of wallet and enhancing consumer lifetime value across our portfolio. Market leading position with significant nationwide scale. We are the largest global boutique fitness franchisor with over 1,900 studios operating across ten brands in the United States alone. Our three largest brands have leading market share positions within their respective verticals. These brands, Club Pilates, Pure Barre and CycleBar, were approximately nine, four and three times larger than their next largest competitors, respectively, as of December 31, 2021. As the leader in these verticals, and as one of few players of scale, we believe that we occupy an advantageous position in an otherwise highly fragmented boutique fitness market. We are able to leverage the popularity and reputation of existing Xponential studios to support both new studio sales to franchisees and to support franchisees ability to attract new customers to their studios. We believe that the continued expansion of the Xponential platform creates a network effect that reinforces our competitive Table of Contents position, making us increasingly attractive to potential franchisees and making studios increasingly popular with boutique fitness consumers. In conjunction with our scale, we have been able to achieve broad geographic diversification across the United States with studios in 48 states, the District of Columbia and Canada as of December 31, 2021. According to Buxton Company, over 62% of the U.S. population (excluding Alaska and Hawaii) lives within 10 miles of an Xponential studio location. Our geographic reach represents a material competitive advantage, as we have demonstrated success across various markets, and we are able to remain competitive nationally when extraordinary events heavily impact specific markets. Passionate, growing and loyal consumer base. Our franchised studios provide differentiated and accessible boutique fitness experiences that are fun, energetic and deliver a strong sense of community, engendering loyalty and engagement with consumers. Our brands serve a broad demographic; our consumer skews female and is typically between the ages of 20 and 60 years old, holds at least a bachelor s degree and reports household income greater than $75,000 per year. Across our system, more than 1.3 million unique consumers completed nearly 30 million in-studio, live stream and virtual workouts in 2021 and more than 850,000 unique consumers completed nearly 20 million in-studio, live stream and virtual workouts in 2020. As of December 31, 2021, studios had nearly 450,000 members, of which over 390,000 were actively paying members on recurring membership packages (excludes Rumble and BFT). The number of total members at studios as of December 31, 2021 represented an increase of 49% and 29% compared to the number of total members at studios as of December 31, 2020 and 2019, respectively. The loyalty of our consumer base is evidenced by our franchisees ability to recover to approximately 113% of actively paying members as of December 31, 2021, relative to December 31, 2019 levels and membership visits for the quarter ended December 31, 2021 were at 117% relative to the quarter ended December 31, 2019 levels (excludes Rumble and BFT). For the quarter ended December 31, 2021, run-rate AUVs recovered to approximately 94% relative to the quarter ended December 31, 2019 (includes Rumble and BFT). Our franchised studios foster consumer engagement, personal accountability to achieve fitness goals and a strong sense of community, which drive repeat visits and maximize consumer lifetime value. We believe that we were able to deepen our consumer loyalty during the COVID-19 pandemic through our robust digital platform offering, as well as the personal efforts of exceptional franchisees to strengthen their studio communities. As of December 31, 2021, we had over 55,000 total users on our digital platform, XPLUS, and we offered over 2,800 digital workouts in our content library. Approximately 90% of class bookings were done through the Xponential brand app in the 90 days ending December 31, 2021. In addition, we continually seek ways to further heighten the Xponential consumer experience. For example, we launched a partnership with Apple in March 2021 that features Apple Watch integration across all of our popular fitness and wellness verticals, excluding BFT, and is designed to increase consumer engagement and retention across our franchised studios. Xponential Playbook supports system-wide operational excellence. We strategically partner with franchisees who have been vetted by a thorough selection process. Through the Xponential Playbook, we provide franchisees with significant support from the outset, focused on delivering a superior experience and maximizing studio-level productivity and profitability. Franchisees also benefit from the significant investments we have made in our corporate platform, through which we leverage integrated systems and shared services. While marketing and fitness programming are specific to each brand, nearly all other franchisee support functions are integrated across brands at the corporate level, and franchisees are guided through the key pillars of successful studio operations. We believe the relationships we maintain with franchisees drive tangible results for consumers: well-managed boutique fitness studios; access to technology capabilities; retention of highly qualified instructors; and a consistent, community-based experience across Table of Contents brands and geographies. We believe the extensive level of support we provide to franchisees is a key driver of system-wide operational excellence. Asset-light franchise model and predictable revenue streams that support free cash flow conversion. We believe our asset-light franchise model drives faster system-wide unit growth, compared to a similarly capitalized corporate-owned model. As a franchisor, we have multiple highly predictable revenue streams and low ongoing capital requirements. Upon the granting of access to a license, we receive a one-time, non-refundable upfront payment from franchisees for the right to open a studio in a specific territory. This is followed by a series of contractual payments once a studio is open, many of which are recurring, including royalty fees, technology fees, merchandise sales, marketing fees and instructor and management training revenues. More than 75% and 73% of our revenue in 2021 and 2020, respectively, was considered recurring, and we believe this percentage will increase as franchise royalty fees are expected to account for a greater percentage of our revenue over time. Highly attractive and predictable studio-level economics. The Xponential Playbook is designed to help franchisees achieve compelling AUVs, strong operating margins and an attractive return on their invested capital. Studios are generally designed to be between 1,500 and 2,500 square feet in size, depending on the brand, which contributed to a relatively low average initial franchisee investment of approximately $350,000 in 2021 and 2020. Our model is generally designed to generate, on average under normal conditions, an AUV of $500,000 in year two of operations and studio-level operating margins ranging between 25% and 30%, resulting in an unlevered cash-on-cash return of approximately 40%. A studio reaches base maturity when it has annualized monthly revenues in the $400,000 to $600,000 AUV range. Using our model, we expect this to typically occur 6-12 months after studio opening. We believe that studios typically have opportunity to continue growing and maturing beyond that point, however. We believe the continued growth of the franchisee system reflects the attractiveness of our unit economic model. In 2021, 252 new franchisees joined our system in North America, representing a 91% increase year-over-year. In 2020, we were able to attract 132 new franchisees in North America despite the material challenges faced by the overall fitness industry as a result of the COVID-19 pandemic. Additionally, franchisees frequently re-invest into our system, as 33% and 36% of new studios in 2021 and 2020, respectively, were opened by existing franchisees. We believe our strong studio-level economics have contributed to our growth. Large and expanding franchisee base with visible organic growth. Our large number of existing licenses sold represents an embedded pipeline to support the continued growth of our business. As of December 31, 2021, on a cumulative basis since inception, we had 4,424 franchise licenses sold globally, compared to 1,508 franchise licenses sold as of December 31, 2017, on an adjusted basis to reflect historical information of the brands we have acquired. Franchisees are contractually obligated to open studios in their territories after purchasing a franchise license. In the event that franchisees are unable to meet their contractual obligations, we have the ability to resell or reassign their territory license(s) to another franchisee in the system or our franchisee pipeline. Based on our experience as a franchisor, we believe that a significant majority of our licenses sold will convert into operating studios. Accordingly, we have the potential to substantially increase our studio base through our existing licenses sold, providing us high visibility into our unit growth and further increasing our already significant scale within the boutique fitness industry. Proven and experienced management team with an entrepreneurial culture. Our strategic vision and entrepreneurial culture are driven by our highly experienced management team, led by our Chief Executive Officer and founder, Anthony Geisler. Mr. Geisler has direct experience scaling Table of Contents franchised fitness brands, having previously served as the Chief Executive Officer of LA Boxing, and has worked with many members of our leadership team for several years. Our Brand Presidents are key members of our leadership team and act as the driving force behind their respective brands. Collectively, our management team fosters an entrepreneurial culture and mentality that resonate with franchisees. The strength of our management team is illustrated by the growth of the business and the recent honors that we and our brands have received, with four brands (Club Pilates, Pure Barre, CycleBar and StretchLab) each being listed among Entrepreneur s 2022 Franchise 500 rankings. Our leadership team has significant experience scaling franchised fitness brands and has created a culture designed to enable our future success. Our Growth Strategies We believe we are well-positioned to capitalize on multiple opportunities to drive the long-term growth of our business: Grow our franchised studio base across all brands in North America. We have the opportunity to meaningfully expand our franchised studio footprint in North America by leveraging our multiple brands and verticals, as well as our proven portability across regions and demographics. We have grown our franchised studio footprint in North America from 813 open studios across 47 U.S. states, the District of Columbia and Canada as of December 31, 2017 to 1,954 open studios across 48 U.S. states, the District of Columbia and Canada as of December 31, 2021, on an adjusted basis to reflect historical information of the brands we have acquired, representing a CAGR of 25%. As of December 31, 2021, we had 1,556 franchisees and licenses for 1,806 studios contractually obligated to be opened under existing franchise agreements in North America. We sold 787 licenses in 2021 compared to 265 licenses in 2020 and 923 licenses in 2019 in North America. While we experienced delays in new studio openings in 2020 and 2021 due to the COVID-19 pandemic, we have continued opening studios throughout the COVID-19 pandemic and franchisees have opened 426 studios in North America from April 2020 through December 2021. Our track-record of successful expansion demonstrates that the experience and value offered by our brands resonate with consumers across geographies, including urban and suburban markets, ages and income levels. Our small box format and multi-brand model have enabled us to scale rapidly, as franchisees have the ability to open studios across multiple brands adjacent or in close proximity to each other, creating cross-selling opportunities and providing consumers with greater optionality. As we scale, we expect to attract multi-studio franchisees to help us accelerate our pace of growth. Based on our internal and third-party analyses by Buxton Company, franchisees could have a total of approximately 6,900 studios in the United States alone, prior to the acquisition of BFT. While no formal analysis has been conducted to assess the incremental studio opportunity attributable to BFT, Buxton expects that the addition of BFT will add approximately 1,000 more independent studio opportunities to our United States whitespace provided that we and BFT continue to operate in a manner consistent with the rest of our brands. This estimate represents the number of potential studio locations in the United States that exists in 2021 based on the criteria we consider for franchise license locations, such as customer profiles, trade area analyses and brand performance. Franchisees provide the capital to open each studio location and we provide ongoing support. We also continue to grow our presence in North America through strategic brand partnerships. In November 2021, we entered into a Master Facility Development Agreement with the operators of the LA Fitness and City Sports Club Brands. This partnership allows us the exclusive rights to grant franchise licenses to franchisees within LA Fitness and City Sports Club s 500 locations. We ve committed to offering 350 franchise licenses within LA Fitness and City Sports Club locations over the next five years. Development is already underway, with the first few locations having opened in early 2022. Table of Contents Drive system-wide same store sales and grow AUV. We believe we can help franchisees grow same store sales and AUVs by acquiring new consumers, increasing membership penetration, driving increased spend from consumers and expanding ancillary revenue streams through our franchised studios. Acquiring new consumers: We expect to grow our consumer reach through a variety of targeted marketing campaigns at both the brand and franchisee levels to increase brand awareness and drive studio traffic. Increasing membership penetration: We expect franchisees to convert new and occasional consumers into committed, long-term members by delivering consistent, effective workout experiences across our franchised studios. We intend to continue to utilize insights from our consumer management dashboard to refine our sales strategy and offer a variety of flexible membership options to attract consumers at different engagement levels and price points, including our existing four, eight and unlimited classes per month recurring membership options. Excluding StretchLab, the average price per class for the consumer ranges from $12 to $25. Driving increased spend from consumers: We expect to increase spend from consumers by utilizing dynamic pricing tiers across markets and brands, up-tiering memberships, cross-selling memberships across our brands, driving further digital penetration and enhancing our membership engagement. We work closely with franchisees to optimize membership offerings based on local consumer demand, demographics and other market factors in order to maximize our share of wallet. Utilize XPASS to enhance consumer experience and engagement and more effectively cross-sell our brands: We implemented XPASS in 2021, a membership option that offers our consumers access to multiple brands across the Xponential portfolio under a single monthly membership. XPASS works through a tiered pricing system where consumers pay a given amount for a set number of points. We believe that XPASS will enable us to continue to attract and retain consumers that are seeking greater variety in their boutique workouts and that we are able to leverage XPASS to introduce consumers to new brands and verticals within our platform. XPASS offers five monthly subscription options designed to suit different consumer preferences. Subscription plans range from $19 to $249 to enjoy between 1 and 20 classes per month. The most popular subscription plan is $99 to enjoy up to seven classes per month. XPASS is designed to optimize inventory for classes at our franchisees studios through dynamic pricing and assisting in filling open spaces in classes. Franchisees receive approximately 70% of the subscription fee from XPASS and we receive 30% of the subscription fee. XPASS currently includes all brands other than BFT. Attract and retain consumers through our XPLUS digital platform: We believe there is an opportunity to further capitalize on growing consumer demand for digital and at-home fitness solutions by enhancing system-wide capabilities that complement our in-studio offerings. Our digital platform consists of a library of branded content that we make available to our consumers across our online and mobile platforms for a monthly fee of $19 for individual brand access and $29 for access to all brands. As of December 31, 2021, we had over 55,000 total users on our digital platform, XPLUS, and we offered over 2,800 digital workouts in our content library. In addition to increasing engagement and retention with our existing in-studio members, our digital platform programs enable us and franchisees to reach new consumers and generate incremental revenues without increasing overhead costs. This enables our brands to deliver high-quality fitness content and maintain strong levels of member engagement, even when studios are closed. Our proprietary mobile app also allows us to control the user experience. Over 90% of class bookings in studios Table of Contents were done via our proprietary mobile app in the 90 days ending December 31, 2021. Using the experience, knowledge and data we gathered in 2021 and 2020, we are planning to further enhance our production studio, increase production talent and upgrade our content to more closely resemble the in-studio experience at home, so members can experience our brands at any time. Our digital platform offering currently includes all brands other than BFT. Our new XPLUS digital platform is expected to significantly enhance our member experience and further increase our brands reach, accessibility and subscriber engagement. Expanding additional revenue streams within our franchised studios: We believe we have the opportunity to increase consumer spending at our franchised studios by expanding our offering of branded and third-party retail products across apparel and other health and wellness categories. During government-mandated studio closures due to the COVID-19 pandemic, franchisees were able to generate revenue in part through retail sales, including the sale of at-home fitness equipment such as exercise balls and weights. We expect that franchisees will be able to continue to leverage this revenue stream in the future as some consumers may continue to make at-home fitness a complementary component of their health and wellness regimens. Expand operating margins. We have built our franchised boutique fitness platform across verticals through a series of acquisitions, investments in our brands, corporate infrastructure and leadership team. We expect to realize improved operating leverage and increase operating margins over time as we continue to expand our franchised studio base and leverage our shared services and platform. Additionally, we expect royalties to become a greater percentage of our revenue mix as we continue to open new studios over time. Royalties represent a high margin revenue stream, and we expect an increase in royalties as a percentage of sales to lead to increased operating margins. We have demonstrated our ability to expand our adjusted EBITDA margin, growing margins from 12.8% in 2019 to 17.6% in 2021. Our business model provides us with highly predictable and recurring revenue streams, attractive margins and minimal capital requirements, resulting in the ability to invest in future growth initiatives. Grow our brands and studio footprint internationally. We believe there is significant opportunity for further international growth, underscored by our track-record of successful expansion across a diverse array of North American markets and our recent expansion into multiple international markets, including the 2021 acquisition of BFT. We are focused on expanding into territories with attractive demographics, including household income, level of education and fitness participation. We have developed strong relationships and executed master franchise agreements with master franchisees to propel our international growth. These master franchise agreements obligate master franchisees to arrange the sale of licenses to franchisees in one or more countries outside North America. As of December 31, 2021, we had 176 studios open internationally across Australia, New Zealand, Singapore, Saudi Arabia, Japan, Spain, the Dominican Republic and South Korea. Master franchisees were contractually obligated to sell licenses to franchisees to open an additional 956 studios in ten countries, of which master franchisees have sold 184 licenses for studios not yet opened as of December 31, 2021. Table of Contents
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+Table of Contents SUMMARY Who We Are We are a leading specialty (re)insurer focused on total value creation for all of our stakeholders. With $4,609 million of gross written premiums for the twelve months ended December 31, 2024 and $3,968 million of gross written premiums for the twelve months ended December 31, 2023, we are a scaled multinational business with a diverse product mix balanced across our primary specialty insurance and opportunistic reinsurance franchises, which are both supported by our fee generating capital markets capabilities. We go to market with a single view of risk through our One Aspen approach, which is designed to cater to complex, bespoke solutions that bring together our expertise spanning different lines of business, segments and platforms, enabling us to develop enhanced and differentiated offerings for our distribution partners and customers. We are focused on underwriting excellence and profitable growth to consistently deliver top quartile results, targeting mid-teen operating return on equity across market cycles. This is demonstrated by our combined ratio of 87.9% (adjusted combined ratio of 86.8%), return on average equity 19.4% and operating return on average equity ( Op. ROE ) of 19.4% for the twelve months ended December 31, 2024. We also had a combined ratio of 87.5% (adjusted combined ratio of 86.4%), return on average equity of 26.7% and Op. ROE of 20.2% for the twelve months ended December 31, 2023. Our primary specialty insurance product set is centered around niche specialty lines, such as credit and political risk, cyber, environmental and professional liability, where we can apply our extensive underwriting and industry expertise. Our opportunistic reinsurance business is centered around both specialty and traditional reinsurance lines where we apply risk selection criteria to create unique risk profiles rather than an index of the market as other larger peers may do. Our size presents a distinct advantage, providing us with enough scale to be relevant while still maintaining the ability to be nimble and decisive, which enables us to enter, exit or change the nature of our underwriting positions faster and with greater precision. Our gross written premiums for our Insurance and Reinsurance segments were $2,724 million and $1,886 million, respectively, for the twelve months ended December 31, 2024, and $2,447 million and $1,521 million, respectively, for the twelve months ended December 31, 2023. Through our One Aspen approach, we actively manage our insurance and reinsurance portfolios across market cycles and identify the most attractive risk versus return opportunities to allocate capital. We adopt a dynamic capital allocation approach, utilizing our strong balance sheet and our multiple platforms across the United States, the United Kingdom ( U.K. ), Lloyd s of London ( Lloyd s ) and Bermuda to match risk with the most appropriate source of capital, and to drive efficiencies and optimal outcomes for our customers. Our ability to offer our broker and client partners holistic and customized solutions across our entire platform of Insurance and Reinsurance, and third-party capital offerings through ACM, provides us the opportunity to execute larger, more complex deals which frequently result in more attractive terms and conditions. For the twelve months ended December 31, 2024, we wrote $4,609 million in gross written premiums across our Insurance and Reinsurance segments, at a combined ratio of 87.9% (adjusted combined ratio of 86.8%). Our shareholders equity, excluding AOCI of $(390) million and Preference Shares, net of issuance costs, with a total value of $971 million, was $2,792 million as of December 31, 2024. For the twelve months ended December 31, 2024, we generated $431 million of net income available to ordinary shareholders, representing a 19.4% return on average equity and $433 million of operating income, representing a 19.4% Op. ROE. For the twelve months ended December 31, 2023, we wrote $3,968 million in gross written premiums across our Insurance and Reinsurance segments, at a combined ratio of 87.5% (adjusted combined ratio 86.4%). Our shareholders equity, excluding AOCI of $(400) million and Preference Shares, net of issuance costs, with a total value of $754 million, was $2,555 million as of December 31, 2023. For the twelve months ended December 31, 2023, we generated $485 million of net income available to ordinary shareholders, representing a 26.7% return on average equity and $368 million of operating income, representing a 20.2% Op. ROE. Table of Contents Our Transformation We have progressed through a comprehensive transformation of the business since our acquisition by Apollo in February 2019, centered around a clear strategic vision that has four core tenets: (1) focused underwriting; (2) reduced volatility; (3) improved operational efficiency; and (4) culture. Focused Underwriting: We have significantly reduced the breadth of our Insurance and Reinsurance product offerings to focus on core lines of business where we have a distinct relevance and leading market positions and believe we can achieve superior underwriting results with successful long-term track records. Since our acquisition by Apollo in 2019, we have exited twelve Insurance and five Reinsurance lines of business as part of the strategic repositioning of our underwriting portfolio, which accounted for approximately $911 million of gross written premiums for the twelve months ended December 31, 2018. We have classified $820 million of this as Legacy (as defined in Management s Discussion and Analysis of Financial Condition and Results of Operations Key Performance Measures and Non-GAAP Financial Measures Summary of Continuing and Legacy Business ) business for purposes of reporting on historical legacy underwriting results as these lines of business were exited during the main underwriting remediation period from 2018 to 2021. There were additional exits of two Reinsurance lines of business in 2022, which were part of further refinements to our underwriting strategy, but not classified as part of Legacy underwriting results. We have delivered significant growth in our continuing lines of business, with gross written premiums of $2,760 million in 2019 increasing to $4,609 million for the twelve months ended December 31, 2024. At the same time, we improved our underwriting performance, as illustrated by our adjusted loss ratio and combined ratio decreasing by 12.8 and 15.9 percentage points, respectively, from 2018 to 2024. _______________ (1)Adjusted loss ratio shown for all lines (continuing and legacy); excludes impact of deferred gain and cost of LPT. Table of Contents Reduced Volatility: We have taken extensive action to reduce volatility within both our existing in-force and go-forward businesses. We have dramatically decreased our property catastrophe exposure, with January 1, 2025 net 250-year probable maximum loss ( PML ) exposure of $330 million, which has declined by approximately 64.8% relative to the start of 2018. This allowed us to generate a 19.4% Op. ROE for the twelve months ended December 31, 2024, despite worldwide insured losses of $140 billion, according to Munich Re. We also entered into the LPT with Enstar in May 2022 to limit our exposure to adverse development on the carried reserves for the accident years prior to 2020. This provides substantial ongoing protection against both social and economic inflation, while freeing up capital for our underwriters to deploy into the current attractive pricing environment and allowing our management team to focus on delivering profitable growth from within our continuing lines of business. Our use of ACM is also highly strategic to our business as a tool to manage net line size and overall volatility, while generating more stable fee income. For the twelve months ended December 31, 2024, over 88% of our fee income was derived from continuous investor relationships of 4+ years or investment structures with multi-year commitments. ________________ (1)Represents Occurrence Exceedance Probability PML (1-in-250) for all perils worldwide as of January 1. (2)Guy Carpenter U.S. Property CAT Rate-On-Line Index. Table of Contents Improved Operational Efficiency: We have significantly rationalized our operating footprint, reducing our office locations from 43 to 18, while growing our gross written premiums per employee by 36.4% from 2018 to 2024, and driving a reduction in our expense ratio from 32.9% in 2018 to 28.5% for the twelve months ended December 31, 2024. We continue to invest in operational efficiencies, which we believe will bring meaningful cost benefits in the medium term through traditional operational expense reductions, as well as improvements to our loss ratio achieved through enhanced underwriting systems and data analytics. Culture: We have undertaken a transformation so that we can execute our go-forward strategy in adherence with our values. Since Apollo s acquisition in 2019, to align with our culture and mission, each member of Aspen s executive team has been newly appointed, through either internal promotions or new external hires. Our culture is defined by our core values to be open minded, to do the right thing, to be in it together, to own it, and to innovate. We empower our decision makers, who bring to bear their expertise for clients, and build our reputation as thought leaders in our market spaces. Our employees are challenged to be not just risk allocators, but considered risk managers who demonstrate underwriting judgment, exercising restraint in soft markets and pursuing growth in favorable market conditions. The result of this transformation has been a significant shift in our culture, and a strategic repositioning of the underwriting portfolio that is now being reflected in our financial results, providing a dynamic platform on which to execute our go-forward strategy of growing our core lines of business. Our Business We manage our underwriting operations as two distinct business segments: Insurance and Reinsurance. We have a diversified yet complementary portfolio across these segments, constructed through the lens of our One Aspen approach, where we balance risk on an aggregate basis and tactically deploy capital to the lines of business and platforms that we believe will generate the best returns for the Aspen Group. Our Insurance and Reinsurance segments both leverage third-party capital through ACM, which utilizes our capabilities in the third-party capital space (namely, the Insurance Linked Securities markets) to provide our core Insurance and Reinsurance segments with enhanced capital flexibility and operating leverage. Our size provides an advantage relative to our larger peers, allowing us to be nimble and decisive; entering, exiting or changing the nature of our underwriting positions faster and with greater precision. For instance, as part of our active portfolio management process for the 2024 planning year, we actively managed our portfolio to capitalize on market spaces that represented the best opportunity. As examples of this, in our Reinsurance segment we targeted meaningful growth in our casualty and specialty portfolio through expansion with existing cedants, and, supported by improved pricing on renewals, we grew our mortgage reinsurance book in response to a more favorable outlook for the U.S. economy. Our Insurance segment also grew in specialty lines, while continuing to manage down exposure to certain professional lines of business where market conditions remain challenging. For the 2023 planning year, we made the decision to step back from the aviation, space and bloodstock reinsurance markets as we did not see medium-term returns meeting our targets, while also reducing our risk appetite for mortgage reinsurance in response to uncertainty about the U.S. economy and housing market. In addition, in the Insurance segment we actively managed down from our original 2023 planned growth within selected U.S. management liability and professional liability lines of business, where we have observed a softening rate environment. The strength of our business is evidenced by our numerous industry awards and nominations in 2024 and 2023, including winning Non-Life Insurance Investment Strategy of the Year for Insurance Investor European Awards 2024, winning Insurance ERM s Climate and Sustainability Collaboration Award 2023, Syndicate 4711 rated a Lloyd s Syndicate Gold Award winner in 2023, being shortlisted for Insurance Insider s (Re)insurer of the Year in 2024 and 2023, being shortlisted for Insurance Insider s Carrier of the Year 2024, being shortlisted for 2 awards by The Insurer s Program Manager in 2024, being shortlisted for 2 Insider Honors Awards 2023, our SVP, Chief Financial Officer, Aspen Insurance and Aspen U.S., Yelena La Forgia being named one of Business Insurance s Women to Watch in 2024, and our CEO and Executive Chair, Mark Cloutier, being awarded Inside P&C s CEO of the Year for 2023. Table of Contents Insurance: Our Insurance segment underwrites primarily specialty risks across a diversified set of property and casualty lines of business. We focus on market segments with high barriers to entry that require bespoke underwriting and industry expertise and customized solutions to address client needs. We have long-standing relationships with key distribution partners, primarily comprised of a diversified group of leading retail brokers and wholesale brokers, along with a select number of managing general agents ( MGAs ). We believe our experience in these niche markets has cemented our role as a partner of choice for many of our distributors, as we are able to leverage our capabilities to develop one-stop custom solutions across multiple lines of business, platforms and geographies. We have niche underwriting capabilities across multiple platforms, including: U.S. admitted lines; U.S. excess and surplus ( E&S ) lines; Lloyd s; the U.K. Company Market and Bermuda. The breadth of our capabilities across these platforms allows for solutions that can be tailored to our clients needs while also allowing us to optimize returns based upon prevailing market conditions. Specialty is at the heart of our capabilities and product offerings. We define our specialty orientation to include the following: Product spaces which are non-commoditized where bespoke underwriting expertise and innate sector knowledge is required and serves as a true differentiator; Clients that have complex business challenges requiring customized insurance solutions to fit their specific risk transfer needs; and Risks that are underwritten on an individual basis, frequently requiring advanced analysis and modeling as well as specialized active claims management. Our Insurance segment is organized into four primary portfolios of business: (1) financial and professional lines; (2) casualty and liability lines; (3) first party lines; and (4) specialty lines. Each portfolio has multiple product offerings which are overseen by experienced teams of underwriters who are experts in their given niche. The composition of our Insurance product offering is included below with percentages based on gross written premiums for the twelve months ended December 31, 2024. Table of Contents ________________ (1)Percentages represent gross written premium as a percent of total Insurance gross written premium for the twelve months ended December 31, 2024. (2)Consists of Carbon Syndicate and our partnership with Ki to provide digital capacity through Ki s Lloyd s platform. Specific examples of our expertise and differentiated approach across product lines include: Specialized Expert Underwriters. We employ underwriters who are experts in their respective fields, with the requisite sector knowledge to best assess, select and price risk. For example, the team that handles our ocean marine product line includes former members of the Merchant Marines; our credit and political risk business is supported by former bankers who understand the nuanced complexity associated with credit risk, while our cyber and tech liability teams are trained to field-recognized designations that would traditionally sit outside the insurance industry. Customized Product Offering. We have significantly narrowed our focus to concentrate on niche offerings, seeking to underwrite beyond the traditional lines of business that would result in a portfolio that stands and performs as just an index of the market. Examples of some of our specific product offerings include: Credit and Political Risk: Bespoke contracts for complex credit and project finance deals underwritten by an experienced team of underwriters, supported by dedicated in-house credit analysts, offering one of the widest product suites in the market; Cyber and Tech Liability: A team of global underwriters providing robust risk selection capabilities, who are all required to pass a credentialed network security exam (Certified Information Privacy Professional or Certified Information Privacy Technologist) to ensure consistent risk assessment expertise across the team; Environmental: Specialist liability products to mitigate the financial impacts of environmental financial claims with a team of over 25 underwriters with experience across law, engineering, consulting and risk management, that provide global capabilities from eight cities around the world; Inland Marine: Within this business line, we underwrite both fine arts and construction. Fine arts is underwritten by a dedicated underwriting team with members having over ten years of experience on average. Our construction team has industry relationships with Engineering News Record Top 25 General Contractors, supported by an on-staff engineer, who provides clients access to risk control review, industry recommendations and best practice health checks; U.K. Property & Construction: Structured as three underwriting teams across property investors, business & public sector, and construction, our U.K. property & construction team excels at unusual and special circumstances. We work in collaboration with our U.K. & international casualty underwriters to provide cross-class solutions for our clients and broker partners; and U.S. Management Liability: A portfolio tactically balanced between open market business (with greater exposure to fluctuations in market conditions) and delegated underwriting authority business in the small and midsize enterprise space (which is more stable and less price sensitive). As a subset of our management liability portfolio, transactional liability is a true specialty class where we have long-standing partnerships with two of the most respected underwriting facilities in the market. Tailored Portfolio Solutions. We have designed bespoke portfolio solutions across multiple lines of business for a number of our long-term trading partners. We continue to leverage our multiple operating platforms, bringing the One Aspen approach to market, where our Reinsurance and ACM capabilities facilitate support of and alignment with our Insurance offerings. An example of this is a binder agreement we have with a leading wholesaler, whereby we provide underwriting capacity to multiple specialty programs across both the United States and Europe, utilizing our multiple operating platforms. Table of Contents This approach has been the foundation for establishing a long-term track record of underwriting profitability across numerous lines of business. Aspen s Insurance segment includes a number of highly specialized lines of business that have returned favorable combined ratios across the cycle, highlighting the strength and niche nature of this business. We strive to maintain this caliber of underwriting performance in these lines, while building our track record within our other primary insurance lines of business. For the twelve months ended December 31, 2024, our Insurance segment had $2,724 million of gross written premium, generated $150 million of underwriting income and had a combined ratio of 90.5% (adjusted combined ratio 89.9%). For the twelve months ended December 31, 2023, our Insurance segment had $2,447 million of gross written premiums, generated $113 million of underwriting income and had a combined ratio of 92.3% (adjusted combined ratio 89.0%). Reinsurance: Within this segment, we offer expertise in a variety of global reinsurance lines including casualty reinsurance, property catastrophe reinsurance, other property reinsurance, and specialty reinsurance. We take a simple, yet effective, distribution model targeting long-term relationships and product spaces that have demonstrated strong underwriting returns through market cycles. Our focus goes beyond traditional reinsurance, as we seek to provide our clients with innovative solutions, through both traditional retrocession, and the utilization of third-party capital through ACM alongside our own Aspen balance sheet capital. We are opportunistic yet disciplined in our approach, positioned to benefit from market dislocations and underwriting modest lines to reduce volatility from loss events with the aim of generating highly attractive risk-adjusted returns, as opposed to returns that just track the market index. Our Reinsurance segment is organized into four portfolios: (1) casualty reinsurance; (2) property catastrophe reinsurance; (3) other property reinsurance; and (4) specialty reinsurance. Casualty Reinsurance: Our casualty treaty team has a global product and risk reach, and our analysis of market-wide trends in key territories, supported by close coordination with our claims, legal and actuarial teams, gives us insights that we believe will enable us to succeed in the changing liability landscape. Property Catastrophe Reinsurance: Our success in the property catastrophe market is based on strong risk controls and deep, embedded relationships with our clients, giving us differentiated insights to manage exposures. We utilize advanced models, analytical tools and our experienced global underwriting teams to set terms and deliver timely capacity. Our opportunistic strategy in this line has allowed us to take advantage of a hard market cycle, using price increases, improvement in terms and ACM to enhance our underwriting margins and reshape our exposures. Importantly, we have used the hard market conditions not just for premium growth, but to reduce volatility, as evidenced by a significant reduction in PMLs from 2018 to 2024. Other Property Reinsurance: We provide tailored solutions for a broad spectrum of property risks worldwide through our dual distribution approach, writing business both directly to ceding firms and through brokers. Specialty Reinsurance: We target niche or unusual risks and are focused on offering tailor-made risk transfer solutions for several specialty lines, including mortgage business. We believe our global expertise is well recognized and our team of underwriters across London, Singapore, Zurich and the United States give us valuable regional and global expertise to support our clients. Table of Contents The composition of our Reinsurance business mix based on gross written premiums for the twelve months ended December 31, 2024 is included in the following chart: For the twelve months ended December 31, 2024, our Reinsurance segment had $1,886 million of gross written premiums, generated $196 million of underwriting income and had a combined ratio of 85.1% (adjusted combined ratio 83.1%). For the twelve months ended December 31, 2023, our Reinsurance segment had $1,521 million of gross written premiums, generated $214 million of underwriting income and had a combined ratio of 81.4% (adjusted combined ratio 83.2%). ACM: We participate in the alternative reinsurance market through ACM, which acts as a conduit between Aspen s balance sheet and third-party investors and supports each of our Insurance and Reinsurance segments. ACM sources third-party capital and develops reinsurance structures that leverage the Company s underwriting and analytical expertise and earns underwriting, management and performance fees from third-party investors primarily through the placement and management of collateralized quota share sidecar vehicles. Through such reinsurance sidecar investments, ACM provides investors direct access to our underwriting expertise and earns underwriting, management and performance fees for Aspen from other third-party investors primarily through the placement and management of sidecars, insurance linked securities ( ILS ) funds and other offerings. One recent example is the casualty-focused reinsurance vehicle, Pando Re Ltd. ( Pando Re ). Effective for the 2024 underwriting year, our Operating Subsidiaries entered into a quota share reinsurance agreement with Pando Re whereby Pando Re will participate in our Casualty Insurance, Global Professional Lines Insurance and Casualty Reinsurance business lines. The underwriting and performance fees earned under ACM transactions, such as those earned under the quota share reinsurance agreement with Pando Re, are part of the operations of ACM and contribute to the fee income earned by ACM, which is recorded through underwriting income or loss, as an adjustment to acquisition costs. ACM is highly strategic to our business, providing a unique set of capabilities and tactical optionality to manage risk and improve our returns. Unlike other offerings in the market that are predominantly property catastrophe reinsurance focused, ACM offers investors a broader product suite that provides direct, fully aligned participation to risk underwritten by Aspen s primary specialty insurance and reinsurance portfolios, including actively managed fund products and sidecars. Notably, ACM s capabilities in longer-tail lines of business bring greater stability to our fee income, and thus our underwriting results, as this fee income is associated with stickier third-party capital Table of Contents structured over multiple years. As of December 31, 2024, approximately 62% of third-party capital within ACM supported longer-tail products. ACM is a core differentiator for Aspen, bringing our expertise in capital markets alongside that of our traditional outwards reinsurance capabilities, providing us with increased optionality across cycles in terms of access to capital, complementing our dynamic capital allocation approach. The ACM portfolio generally mirrors our own through collateralized quota share arrangements that provide third-party investors with aligned participation to our Insurance and Reinsurance underwriting. ACM is recognized as an innovator across both catastrophe and non-catastrophe risks and was one of the leaders in developing ILS capabilities for cyber risk. Our strong relationships and reputation in the market have enabled ACM to achieve significant growth since 2018, including in recent years where many insurance capital markets players reduced capacity. The following charts reflect the fee income generated by ACM for each of the twelve months ended December 31, 2019 through the twelve months ended December 31, 2024 and the diversification of ACM s fee income for the twelve months ended December 31, 2024 (dollars in millions unless otherwise noted). ACM generated $169 million and $136 million in fee income for the twelve months ended December 31, 2024 and December 31, 2023, respectively. This fee income is primarily reflected as an offset to our acquisition costs and is therefore embedded in our underwriting results. Investments: Our investment strategy is focused on delivering stable investment income and total return through all market cycles, while maintaining high credit quality and portfolio liquidity. We manage a conservative investment portfolio that is appropriately balanced between our liquidity needs and investment returns, with an average credit rating of AA- and duration of 2.9 years of fixed income securities within our portfolio, as of December 31, 2024. We have access to world-class investment managers and execute this strategy through thoughtful allocations of investment assets to our key investment management partners. To enhance investment returns, we tactically calibrate asset allocation and the duration of our investment portfolio, taking into account the duration of our insurance and reinsurance liabilities, as well as our view of interest rates, the yield curve, credit spreads and other general market conditions. In recent years we have diversified the range of asset classes in which we invest to include collateralized loan obligations, broadly syndicated loans, private credit, real estate equity and debt, private equity related infrastructure investments, high yield bonds and leveraged loans. We hold these investments directly or through fund vehicles. As of December 31, 2024, we allocated $1.6 billion (20%) of our total cash and investments to these asset classes. As of December 31, 2024, Apollo Asset Management Europe PC LLP ( AAME ) managed $1.4 billion of these asset classes. Under our IMAs (as defined below) with AAME, approximately $1.6 billion, or 21%, of our total cash and investments are managed by AAME as of December 31, 2024. As of December 31, 2024, we had $7.7 billion of total cash and investments, excluding catastrophe bonds, net receivables for securities sold and accrued interest receivable, on our balance sheet and for the twelve months ended Table of Contents December 31, 2024, we generated $318 million of net investment income. The charts below provide further details regarding our investment portfolio as of December 31, 2024. For more information on our aggregate portfolio reflected in the chart above (including the characterization of our investments as available for sale and trading), please refer to Management s Discussion and Analysis of Financial Condition and Results of Operations Balance Sheet Total cash and investments. Our Competitive Strengths We believe that our competitive strengths include: One Aspen Approach, Supported by Dynamic Capital Allocation Through our One Aspen approach, we can actively manage our portfolio across counter-cyclical pricing environments in the insurance and reinsurance markets, shifting capital between our two segments and being opportunistic in markets where we perceive advantageous risk versus return opportunities. The markets we serve require capabilities that are not easily replicated and we come to market in a way that allows us to bring our product offerings together and execute on large new deals across different lines of business, platforms and segments. This provides us with greater control over capital allocation and underwriting outcomes, and is a key pillar of our go-forward offering and growth strategy. Our operating and risk allocation strategy has been carefully designed to optimize the use of both our own assets, as well as third-party capital. Business sourced is carefully analyzed and directed to the appropriate underwriting platform, taking into account client characteristics, as well as operational and efficiency considerations. We have a scaled but nimble (re)insurance presence across the most important global underwriting hubs for our lines of business, including the U.S. admitted, U.S. E&S, Bermuda, Lloyd s and the U.K. Company Market, all leveraging our third-party capital markets capabilities (through ACM). Niche Primary Insurance Platform Our insurance strategy is focused on underwriting complex, highly curated, niche lines of business with high barriers to entry. Our Insurance segment generated $2,724 million in gross written premiums for the twelve months ended December 31, 2024 and $2,447 million in gross written premiums for the twelve months ended December 31, 2023. We only participate in lines of business in which our underwriters have deep, technical expertise and where they can be well supported by our platforms and strong capabilities, allowing us to provide innovative and coordinated solutions to clients. From 2018 to 2024, we experienced aggregate rate increases of 72.8% in our portfolio, driven by pricing improvements from our core lines of business. We adopt an efficient tactical use of Table of Contents outwards reinsurance, enabling us to write higher exposure policies while appropriately managing our net retained exposure. Since being acquired by Apollo, we have exited a number of lines of business (legacy business) while also achieving strong growth in our continuing lines of business generating attractive profitability. The combined ratio of our continuing lines of business in our Insurance segment has improved from 99.1% in 2018, to 90.5% (adjusted combined ratio 89.9%) in the twelve months ended December 31, 2024. Opportunistic Specialist Reinsurance Franchise We have built a nimble reinsurance strategy focused on core lines of business within property, casualty and specialty. Our Reinsurance segment generated $1,886 million in gross written premiums for the twelve months ended December 31, 2024 and $1,521 million in gross written premiums for the twelve months ended December 31, 2023 and is positioned to capitalize on dislocation within a broad set of markets. Our strategy is to underwrite modest line sizes to limit exposure from large loss events, and our property catastrophe portfolio has been optimized to generate higher risk-adjusted returns and manage overall volatility. The combined ratio of our continuing lines of business in our Reinsurance segment has improved from 104.6% in 2018, to 85.1% (adjusted combined ratio 83.1%) in the twelve months ended December 31, 2024. Our opportunistic approach has allowed us to take upside from attractive reinsurance underwriting conditions, where we have experienced strong rate increases in a hard market cycle. We have experienced cumulative rate increases of 78.9% from 2018 to 2024. Our strength in reinsurance is bolstered through the deployment of third-party capital through ACM, which provides us with differentiated access to capital and allows us to flex into attractive market opportunities. Growing and Highly Complementary Capital Markets Business Since its inception in 2013, ACM uses our capabilities in the third-party capital markets, to increase the flexibility Aspen s Insurance and Reinsurance underwriters have in allocating risk to the best source of capital. ACM leverages the full breadth of our expertise across distribution, underwriting, modeling, actuarial and claims, to create attractive opportunities for our investor partners. ACM has experienced significant growth, with third-party capital growing from $667 million in 2018 to $2,207 million as of December 31, 2024, and generating $169 million in fee income for Aspen for the twelve months ended December 31, 2024. We believe we have driven innovation in this market and have cultivated close relationships with third-party capital investors. ACM is a differentiated capability and highly strategic to our business, allowing us to support our Insurance and Reinsurance segments with third-party capital, and serving as a mechanism for tactical de-risking as we leverage fee income from our on-balance sheet underwriting risk. This capability provides us with the ability to flex into attractive opportunities in accordance with underwriting cycles and enhances our go-to-market strategy. Deep Trading Partner Relationships We have seasoned and diversified relationships with partners across our Insurance and Reinsurance segments. The distribution strategy within our Insurance segment is focused on specialized intermediaries with whom we have long-standing relationships. Our distributors are experts in their field and know our products and risk appetite well. We have flexibility across retail brokers, wholesale brokers and MGAs to drive value and maintain deep relationships without being overly reliant on any one large partner. Our Reinsurance segment is characterized by the longevity of our relationships with cedants, with 78.0% of premium for underwriting year 2024 having been written with cedants who have maintained their reinsurance relationship with us since 2014. We believe we are viewed as a strong, reliable counterparty. Strong Balance Sheet We have an efficient capital structure and strong capitalization with $3,672 million of total capital as of December 31, 2024. We implement a disciplined and proactive approach to manage excess capital and provide opportunistic shareholder returns. In the twelve months ended December 31, 2024, we paid ordinary share dividends of $195 million in addition to Preference Share dividends. Additionally, we have strong financial strength ratings Table of Contents from both A.M. Best Company, Inc. ( A.M. Best ) ( A ) and Standard & Poor s Financial Services LLC ( S&P ) ( A- ) and maintain Group BMA Bermuda Solvency Capital Requirement ( BSCR ) above the applicable regulatory requirement as of December 31, 2024. We maintain our Group BMA BSCR significantly in excess of regulatory minimums. The strength of our balance sheet and underwriting platform is supported by the LPT transaction with Enstar, which provides protection against deterioration on 2019 and prior accident year carried reserves, significantly limiting Aspen s exposure to the risk of unfavorable development from these accident years while still retaining the scale, market relationships, and operational infrastructure to capitalize on current market conditions to continue to grow our business. The following chart shows our pre-2020 accident year carried reserves, as well as the LPT coverage above such carried reserves, as of September 30, 2021 and December 31, 2024. Highly Experienced Management Team Led by our CEO and Executive Chair, Mark Cloutier, we have an experienced executive leadership team from diverse backgrounds, each with a specific role and purpose to drive the transformation of our business. Since Apollo s acquisition in 2019, to align with our corporate culture and mission, each member of Aspen s executive team has been newly appointed, through either internal promotions or new external hires. Our team has an average of 30 years of experience across all facets of the global specialty property & casualty (re)insurance and financial services sectors, including underwriting, claims, technology, investment management, risk management, finance, brokering, actuarial, people and operations. Table of Contents Our Strategy As a Group, we aim to bring Clarity from Complexity. We seek to transform complex risks into opportunities through efficient and innovative solutions, leveraging our multi-platform capabilities across our Insurance and Reinsurance segments, both of which are supported by ACM. We believe we are a market leader in our industry that provides our clients with confidence and the best possible outcomes. Our culture, which prioritizes collaboration, accountability and service, allows us to provide intelligent, swift solutions in the face of challenges. Whatever the challenge is, we are One Aspen . Our vision statement is to be a top quartile specialty risk (re)insurer focused on total value creation through underwriting profit and investment performance. Our ability to achieve this goal is based on three key pillars, which we believe create a virtuous cycle for success: 1.Sustained Profitability: This encompasses several items, including profitable growth, delivering consistent results, managing Funds at Lloyd s (as defined below) and efficiently allocating capital, retaining agility and embedding cross functional collaboration. These goals all highlight the importance of financial success and sound risk management for Aspen. 2.Brand Strength and Market Presence: This priority relates to being a partner of choice, easy to transact with, a provider of creative solutions and outstanding service and our use of data and analytics to improve performance and service and a healthy control environment. 3.Employer of Choice: Talent development, leadership, and building a strong, engaged workforce are emphasized throughout Aspen. Improving the effectiveness of the Group Executive Committee (the Group Executive Committee ), managing people and communication implications, and developing a sustainable model all point to the importance of investing in human capital and fostering a positive work environment. Our technology strategy is underpinned by our mission to underwrite excellent business and to automate and digitize operations from ingestion to downstream functions. As part of our strategy, we amplify underwriting and claims results through the use of data and technology insights. Underlying data is key to our decision making and we have extensively invested in enterprise-wide data and analytics capabilities. We are transitioning to a single, comprehensive enterprise-wide data repository, built on over 20 years of underwriting history, which will form the foundation for our reporting, business intelligence, analytics and other advanced data capabilities. We believe this agile platform will allow us to develop our real time access to analytics and provide us with an advantage in managing our risk and better claims / portfolio management. In addition, we have invested in a variety of application programming interface and cloud capabilities, which give us greater flexibility in integrating our multi-national underwriting operations and leveraging software as a service and third-party data sources to ensure a competitive advantage. Underpinning all of this is our ability to maintain a strong balance sheet and manage our capital prudently. We have a highly efficient capital structure and our capitalization is strong, as evidenced by our strong financial strength ratings. We are constantly monitoring rating agency guidelines, changes in our regulatory environment and market opportunities to ensure that our capital structure is appropriate for our strategic ambitions. We maintain robust procedures for setting loss reserves and actively managing risk in our portfolio. Our reserve confidence was further strengthened by the previously mentioned LPT transaction executed in May 2022. In today s attractive underwriting environment, we see ample opportunity to deploy excess capital into both our Insurance and Reinsurance segments, but through the cycle we may return capital to shareholders when opportunities are limited during soft insurance markets. See Dividend Policy. We are guided by the phrase One Aspen Team, Creating Value, which is underpinned by our core set of values to be open minded, to do the right thing, to be in it together, to own it, and to innovate. We have built Table of Contents Aspen s culture around these guiding principles to foster an environment that promotes innovation, collaboration, inclusiveness and accountability. Our Markets and Opportunity We operate within the global (re)insurance market, where we have significant opportunities to capture attractive risk-adjusted returns across the cycle through our multi-platform capabilities. The global macroeconomic and social environment continues to drive demand for increasingly complex (re)insurance solutions delivered as a joined-up offering, which is where we thrive. In recent years, rate increases have been driven by the increased frequency and severity of natural catastrophe events globally (impacted by changing weather patterns), inflation (both social and economic), increased geopolitical tensions and other risks that have grown and emerged, increasing the demand for specialty solutions. As a result, the global commercial insurance industry has seen 33 consecutive quarters of price increases according to Willis Towers Watson s ( WTW ) Commercial Lines Insurance Pricing Survey Q3 2024. We expect these hard market conditions will persist, as they are driven by uncorrelated and continuing macroeconomic and social dynamics. This will provide opportunities for us to deliver profitable growth as we target new business and clients at favorable risk-adjusted rates and with improved terms and conditions, while maintaining disciplined risk selection. Furthermore, our chosen lines of business within Insurance have high barriers to entry requiring the bespoke tailoring of products and the need for specialized and experienced underwriters with tenured distribution relationships. The higher interest rate environment provides additional tailwinds for our business. Higher returns from our fixed income portfolio complement our underwriting income with attractive investment income and contribute to our ability to generate strong risk-adjusted returns for our shareholders. With a low-risk fixed income portfolio of relatively short duration of 2.9 years as of December 31, 2024, we are well placed to take advantage of attractive investment yields as we rotate and reinvest. Global Insurance Market Within Insurance, we operate within both the U.S. specialty and international insurance markets. U.S. Specialty Aspen operates within the broadly defined U.S. commercial lines market, which generated annual industry direct premiums of approximately $462 billion as for the twelve months ended December 31, 2023. The industry has experienced improved underwriting performance following the COVID-19 pandemic and wider economic uncertainty. Within commercial insurance, the excess and surplus ( E&S, non-admitted or surplus lines ) market has demonstrated strong growth, with highly attractive rate increases and improvement in terms and conditions. We wrote $821 million of gross premiums in the E&S market for the twelve months ended December 31, 2024 and $879 million for the twelve months ended December 31, 2023. A.M. Best estimates that this market segment generated $115 billion in annual premiums in 2023, nearly doubling since 2018. Driving this growth is the Table of Contents macroeconomic and social environment and challenges within the admitted space, which continues to drive demand for specialized insurance solutions due to both increasing and more complex risks from the commercial market. E&S carriers are generally permitted to craft insurance terms to suit the particular risk they are assuming as the underlying risks tend to have unique qualities. Consequently, in this space we are able to provide tailored contracts and limit exposure to loss by either excluding coverage or providing a sub-limit on coverage. This customized approach provides the opportunity to achieve attractive long-term profitability. We underwrite business in the United States through Aspen American Insurance Company and Aspen Specialty Insurance Company on an admitted and E&S basis, respectively. For the twelve months ended December 31, 2024, we generated $821 million and $1,072 million of gross written premiums in the U.S. E&S and admitted markets, respectively. For the twelve months ended December 31, 2023, we generated $879 million and $863 million of gross written premiums in the U.S. E&S and admitted markets, respectively. International Insurance Our international insurance products are underwritten in the London Market, through both our Lloyd s and U.K. Company Market platforms. Lloyd s is a competitive insurance market where individual underwriters accept risks on behalf of groups, called syndicates, of individual and corporate members whose resources provide the security behind the Lloyd s policies that they underwrite. Lloyd s is the world s largest specialty insurance marketplace, underwriting 56 billion of premiums during the twelve months ended December 31, 2024, up 7% from the same period in the prior year. The Lloyd s global distribution network is where many of the world s most complex risks are placed, across more than 60 specialty lines of business. Over 50 leading insurance companies participate in the market with more than 380 registered Lloyd s brokers and a global network of over 4,000 local coverholders. We have a significant presence at Lloyd s through our integrated Lloyd s vehicle, comprising Syndicate 4711, managed by AMAL with fully aligned capital, which in addition to access to complex risks also provides us (re)insurance licensing access for 80 territories (and an additional 20 territories on a reinsurance only basis) across the Americas, the United Kingdom, Europe, and Asia Pacific. AUL, as the sole corporate member of Syndicate 4711, must deposit sufficient capital to support its underwriting at Lloyd s. Aspen is well positioned within Lloyd s, with Syndicate 4711 having a reported combined ratio of 82.3% for 2024 and a reported combined ratio of 86.7% for the twelve months ended December 31, 2023. We wrote $1,400 million of gross premiums in the Lloyd s market for the twelve months ended December 31, 2024 and $1,054 million for the twelve months ended December 31, 2023. The U.K. Company Market is an important market for global specialty insurance, with companies and individuals worldwide turning to this market to protect against niche and hard-to-place risks, ranging from liability and professional lines, to cyber and renewable energy exposures. Gross premium written in this market stood at 48 billion in 2023 up 47% from 33 billion in 2020. While there is no standard definition of this market, there is a general agreement that the core of its activity is internationally traded non-life, commercial and specialty insurance and reinsurance business written by insurers operating outside Lloyd s. This is mostly P&C (re)insurance, with an increasing emphasis on high-exposure risks. The diversity and expertise of insurers and underwriting talent, as well as the ecosystem of service providers, make this a highly attractive market to write our U.K.-centric lines of business. We write business in this market through Aspen Insurance UK Limited. We wrote $367 million of gross written premiums in this market for the twelve months ended December 31, 2024 and $320 million for the twelve months ended December 31, 2023. Global Reinsurance Market Global reinsurer capital rose to a new high of $715 billion at September 30, 2024, an increase of $45 billion relative to the end of 2023, driven mainly by retained earnings according to Aon data. Reinsurers are actively deploying this additional capital across many lines of business in pursuit of growth. This additional supply is outstripping ceding company demand leading to modest price weakening primarily in property and specialty lines. Given concerns around social inflation and pockets of adverse loss development in the industry, casualty lines are experiencing increases in price, but generally stable trading conditions. Overall, the reinsurance market is attractive and continues to be adequately priced across most lines of business. Our global underwriting platforms in Table of Contents reinsurance and differentiated, diverse ACM capabilities provide us with an opportunity to react quickly to market conditions and benefit from the current market cycle. Our Reinsurance business segment is underwritten through four core platforms, which include AAIC, Aspen UK, Syndicate 4711, and Aspen Bermuda. This also encompasses our branch offices, with our European hub in Zurich and our Asia Pacific hub in Singapore under Aspen Bermuda, and our Canadian branch under Aspen UK. We wrote $1,886 million of gross written premiums in the reinsurance market for the twelve months ended December 31, 2024 and $1,521 million for the twelve months ended December 31, 2023. Our Sustainability Principles For Aspen, sustainability is about helping our clients when they need us, delivering for our shareholders, supporting our communities and creating a nurturing and inclusive working environment for our colleagues. Our sustainability approach is committed, open minded, pragmatic and comes from the heart of our business. We believe we can make greater impact by taking thoughtful and responsible actions today, ultimately playing our part in a more sustainable future. We expect to play our part pragmatically in the transition towards a low carbon economy. Our vision to bring Clarity from Complexity is reflected in the approach we take and how we work to deliver our long-term sustainability objectives. Our approach is to be transparent and accountable, creating impact by taking thoughtful and responsible actions. Working together with clients, partners, and regulators across the industry, we are developing innovative solutions intended to address challenges, raise awareness, and actively manage risk. Our sustainability efforts are centered around three pillars: 1.Environmental: We have calculated our Scope 1 and Scope 2 greenhouse gas ( GHG ) emissions, and continue to expand the measurement of our Scope 3 GHG emissions utilizing estimates, methodologies and conversion factors aligned to the GHG Protocol for our industry. In 2024, we continued efforts to manage our environmental impact by compensating for a significant portion of our unavoidable GHG emissions by funding only what we consider to be rigorously-audited and highly-verified carbon offset programs, while seeking opportunities to improve our data integrity and reduce our carbon footprint. Our 2024 offsetting program supports nature-based climate solutions to largely cover Aspen s Scope 1 and 2 emissions, as well as a portion of Scope 3 emissions measured. Projects are selected to align with our values, focusing on positive impact, social value beyond carbon, and investing in new technologies for long-term carbon sequestration. Our sustainability initiatives enable us to be more data-led when determining projects to fund, where we invest, and how we partner with clients and suppliers throughout our value chain. 2.Social: Our Corporate Social Responsibility ( CSR ) strategy is rooted in a commitment to global consciousness and local action, aligning our contributions with partners and organizations that advance our values and strategic objectives. Our Group initiatives Give as You Earn and Volunteer Day allow for our people to dedicate both time and financial support to charities of their choice worldwide. Additionally, as part of our commitment to developing the leaders of the future, we engage with programs that foster an inclusive environment across all of our businesses, championed through the work of our Diversity, Equity and Inclusion Delivery Board which drives initiatives aligned to enhancing inclusion and belonging. 3.Governance: In an age of increased and changing risks, we prioritize the strengthening of our corporate governance by enhancing operational structures to integrate and guide our approach to sustainability, creating the right governing bodies and oversight to embed sustainability at the core of our business. We continue to progress our approach to administering strong governance over the strategic delivery, effective risk management, and assessment of key metrics. Summary Risk Factors Investing in our ordinary shares involves risks. Prospective investors should carefully consider the risks described in Risk Factors below, as well as other information contained in this prospectus before making a decision to invest in our ordinary shares. Any of the factors set forth under Risk Factors could materially adversely affect our business, financial condition, results of operations or cash flows and could impact any forward-looking statements. Prospective investors should note that such risks are not the only ones we face. Additional risks Table of Contents and uncertainties not currently known to us or that we currently deem to be immaterial may also materially and adversely affect us in the future. Among these important risks are the following: we may be adversely affected by the occurrence of natural disasters, severe weather events and other catastrophe events, as well as outbreaks of pandemic or contagious diseases, and we could face unanticipated losses from war, terrorism and political unrest, cyber attacks, government action that is hostile to commercial interests and from sovereign, sub-sovereign and corporate defaults; these or other unanticipated losses could have a material adverse effect on our financial condition or operating results; global climate change, as well as increasing laws, regulation and litigation in the area of climate change, may have an adverse effect on our results of operations, financial condition or liquidity; our results may fluctuate as a result of many factors, including cyclical changes in the reinsurance and insurance industries; our reinsurers may not reimburse us for claims on a timely basis, or at all, which may materially and adversely affect our business, results of operations and financial condition; a material proportion of our business relies on the assessment and pricing of individual risks by third parties; the failure of any risk management and loss limitation methods we employ could have a material adverse effect on our financial condition and operating results; our financial condition and operating results may be adversely affected if actual claims exceed our loss reserves; we may be adversely impacted by economic or social inflation; our investments are subject to interest rate, credit, and real estate related risks, which may adversely affect our net income and may adversely affect the adequacy of our capital our operating results may be adversely affected by the failure of policyholders, brokers or other intermediaries or reinsurers to honor their payment obligations; competition and consolidation in the (re)insurance industry could reduce our growth and profitability; our Operating Subsidiaries are rated and our Lloyd s business benefits from a rating by one or more of A.M. Best and S&P and a decline in any of these ratings could adversely affect our standing among brokers and customers and cause our premiums and earnings to decrease, or may otherwise result in an adverse effect on our business, financial condition and operating results; we depend on a few brokers for a large portion of our insurance and reinsurance revenues and the loss of business provided by any one of those brokers could adversely affect us; political, regulatory, governmental and industry initiatives and the inability of third parties with whom we do business to appropriately manage their risks, may have a material adverse effect on our business, financial condition, results of operations, liquidity, cash flows and prospects; our internal controls over financial reporting have gaps or other deficiencies; management turnover or our inability to attract and retain senior staff, including our executive officers, senior underwriters or other members of our senior management team, creates uncertainties and could harm our business; as a foreign private issuer and controlled company within the meaning of the NYSE corporate governance rules, we are permitted to, and do, rely on exemptions from certain of the NYSE corporate governance standards; our reliance on such exemptions may afford less protection to holders of our ordinary shares; Table of Contents a failure in our data security and/or technology systems or infrastructure or those of third parties, including those caused by security breaches or cyber-attacks or through the incorporation of artificial intelligence ( AI ), could disrupt our business, damage our reputation and cause losses; following this offering, we will continue to be controlled by Apollo, and Apollo s interests may conflict with our interests and the interests of our other shareholders; our holding company structure and certain Companies Act, regulatory and other constraints may limit our ability to pay dividends on our securities; we cannot pay a dividend on our ordinary shares unless the full dividends for the most recently ended dividend period on all outstanding Preference Shares have been declared and paid; and the other factors identified under Risk Factors in this prospectus. Our Corporate Structure and the Pre-IPO Transaction We were incorporated on May 23, 2002 in Bermuda as a holding company operating under the laws of Bermuda. Our principal office is located at 141 Front Street, Hamilton, HM19, Bermuda. Our telephone number is +1 441-295-8201 and our website address is www.aspen.co. Information contained on, or that can be accessed through, our website is not part of and is not incorporated by reference into this prospectus, and you should not consider information on our website to be part of this prospectus. Prior to this offering, Highlands Bermuda Holdco, Ltd., a holding company affiliate of certain investment funds managed by affiliates of Apollo, owned all of our issued and outstanding ordinary shares, which constituted its sole assets. On March 30, 2025, Highlands Bermuda Holdco, Ltd. transferred all 60,395,839 of our issued and outstanding ordinary shares, par value $0.01 per share, to us and for consideration of such transfer we issued to Highlands Bermuda Holdco, Ltd. 90,833,333 Class A ordinary shares, par value $0.001 per share (the Exchange ), which have the same voting and economic rights as our existing ordinary shares other than par value. Following the Exchange, Highlands Bermuda Holdco, Ltd. will, pursuant to its plan of liquidation, distribute all 90,833,333 Class A ordinary shares that it received in the Exchange to AP Highlands Holdings, AP Highlands Co-Invest and certain members of our management team (together with the Exchange, the Pre-IPO Transaction ). As a result of the Pre-IPO Transaction, all of our issued and outstanding Class A ordinary shares previously held by Highlands Bermuda Holdco, Ltd. will, after the Pre-IPO Transaction, be held by the existing holders of equity interests in Highlands Bermuda Holdco, Ltd., including AP Highlands Holdings and AP Highlands Co-Invest, both of which are affiliated with and managed by affiliates of Apollo, and certain members of our management team, and our sole issued and outstanding class of ordinary shares will be our Class A ordinary shares. Upon completion of the Pre-IPO Transaction, but prior to the consummation of this offering and the sale of our Class A ordinary shares by the selling shareholders, we will have 90,833,333 Class A ordinary shares issued and outstanding, 56,264,677 Class A ordinary shares of which will be held by AP Highlands Holdings, 34,391,043 Class A ordinary shares of which will be held by AP Highlands Co-Invest and 177,613 Class A ordinary shares of which will be held by certain members of our management team. Following the completion of this offering, we will continue to have one class of authorized and issued ordinary shares and one class of authorized and issued Preference Shares, consisting of three series, which are the AHL PRD Shares, the AHL PRE Shares, which are represented by the AHL PRE Depositary Shares, and the AHL PRF Shares, which are represented by the AHL PRF Depositary Shares. For a more detailed description of our ordinary shares and Preference Shares, see Description of Share Capital. The following diagram sets forth a simplified view of our corporate structure after giving effect to this offering and the Pre-IPO Transaction. The chart assumes no exercise of the option granted to the underwriters to purchase up to 1,650,000 additional ordinary shares in connection with the offering and an initial public offering price of $30.00 per ordinary share, which is the midpoint of the price range set forth on the cover page of this prospectus. This chart is for illustrative purposes only and does not represent all legal entities affiliated with the entities depicted. Unless otherwise noted, each entity is wholly-owned by its immediate parent. Table of Contents ________________ (1)Represents 49,437,624 ordinary shares held by AP Highlands Holdings and 30,218,096 ordinary shares held by AP Highlands Co-Invest. See Principal and Selling Shareholders for detail of the percentage ownership following this offering. (2)Represents 1,185,762 ordinary shares held by certain members of our management team (including the net issuance of 1,008,149 ordinary shares issued upon the completion of this offering as replacement awards with respect to legacy share option awards granted to certain employees of the Company as described in Executive Compensation 2025 Equity and Incentive Plan (based on an assumed initial public offering price of $30.00 per ordinary share, which is the midpoint of the price range set forth on the cover page of this prospectus, and after giving effect to the withholding of 302,038 ordinary shares to satisfy the estimated tax withholding and remittance obligations)). Table of Contents Implications of Being a Foreign Private Issuer We are considered a foreign private issuer and report under the Securities Exchange Act of 1934, as amended (the Exchange Act ) as a non-U.S. company with foreign private issuer status. This means that, as long as we qualify as a foreign private issuer under the Exchange Act, we will be exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies, including: the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; the sections of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q containing unaudited financial and other specified information, or current reports on Form 8-K, upon the occurrence of specified significant events. We may take advantage of these exemptions until such time as we are no longer a foreign private issuer. We would cease to be a foreign private issuer at such time as more than 50% of our outstanding voting securities are held by U.S. residents and any of the following three circumstances applies: (i) the majority of our executive officers or directors are U.S. citizens or residents, (ii) more than 50% of our assets are located in the United States or (iii) our business is administered principally in the United States. In addition, as a foreign private issuer, the Company is also entitled to rely on exceptions from certain corporate governance requirements of the NYSE. As a result, you may not have the same protections afforded to shareholders of companies that are not foreign private issuers. In this prospectus, we have taken advantage of certain of the reduced reporting requirements as a result of being a foreign private issuer. Accordingly, the information contained herein may be different than the information you receive from other public companies in which you hold equity securities. Apollo and Controlled Company Status On February 15, 2019, the Company completed its merger with Highlands Merger Sub, Ltd. ( Merger Sub ), a wholly owned subsidiary of Highlands Bermuda Holdco, Ltd. Merger Sub merged with and into the Company, with the Company continuing as the surviving company and as a wholly owned subsidiary of Highlands Bermuda Holdco, Ltd. Highlands Bermuda Holdco, Ltd. is a holding company affiliate of certain investment funds managed by affiliates of Apollo. Apollo is a leading global investment manager and had total assets under management of $751 billion as of December 31, 2024. On March 30, 2025, Highlands Bermuda Holdco, Ltd. transferred all 60,395,839 of our issued and outstanding ordinary shares, par value $0.01 per share, to us and for consideration of such transfer we issued to Highlands Bermuda Holdco, Ltd. 90,833,333 Class A ordinary shares, par value $0.001 per share, which have the same voting and economic rights as our existing ordinary shares other than par value. Following the Exchange, Highlands Bermuda Holdco, Ltd. will, pursuant to its plan of liquidation, distribute all 90,833,333 Class A ordinary shares that it received in the Exchange to AP Highlands Holdings, AP Highlands Co-Invest and certain members of our management team. As a result of the Pre-IPO Transaction, all of our issued and outstanding Class A ordinary shares previously held by Highlands Bermuda Holdco, Ltd. will, after the Pre-IPO Transaction, be held by the existing holders of equity interests in Highlands Bermuda Holdco, Ltd., including AP Highlands Holdings and AP Highlands Co-Invest, both of which are affiliated with and managed by affiliates of Apollo, and certain members of our management team, and our sole issued and outstanding class of ordinary shares will be our Class A ordinary shares. Upon completion of the Pre-IPO Transaction, but prior to the consummation of this offering and the sale of our Class A ordinary shares by the selling shareholders, we will have 90,833,333 Class A ordinary shares issued and outstanding, 56,264,677 Class A ordinary shares of which will be held by AP Highlands Holdings, 34,391,043 Class A ordinary shares of which will be held by AP Highlands Co-Invest and 177,613 Class A ordinary shares of which will be held by certain members of our management team. Table of Contents Apollo s indirect subsidiary, AAME, is currently the investment manager for the Company and certain of the Company s subsidiaries pursuant to investment management agreements ( IMAs ) that have been entered into with AAME. With effect from January 1, 2025, the rights and obligations of AAME under the IMAs were novated to an affiliate of AAME, Apollo Asset Management Europe LLP ( AAME LLP ). References to AAME in this prospectus shall refer to, at any time post January 1, 2025, AAME LLP, unless the context otherwise requires. In addition, Apollo s indirect subsidiary, Apollo Management Holdings, L.P. ( Apollo Management ), provides the Company with management consulting services and advisory services under a management consulting agreement (the Management Consulting Agreement ). Further, certain of our directors are employees of Apollo and its affiliates and will continue to serve on our Board of Directors (the Board ) following this offering. A description of relationships and transactions that have existed or that the Company and certain of the Company s subsidiaries has entered into with Apollo and its affiliates are described in the section titled Material Contracts and Related Party Transactions Relationships and Related Party Transactions with Apollo or its Affiliates. For a discussion of the risks relating to our relationship with Apollo, see Risk Factors Risks Related to Our Ordinary Shares and this Offering Following this offering, we will continue to be controlled by Apollo, and Apollo s interests may conflict with our interests and the interests of our other shareholders. Following this offering, the Apollo Shareholders will control a majority of the combined voting power of our outstanding shares, resulting in us remaining a controlled company within the meaning of the NYSE corporate governance rules. A controlled company under the NYSE corporate governance rules is a company of which more than 50% of the voting power for the election of directors is held by an individual, group or another company. In the event we no longer qualify as a foreign private issuer, if then applicable, we may rely on the controlled company exemption under the NYSE corporate governance rules. As a controlled company, we are eligible to, and, in the event we no longer qualify as a foreign private issuer, we may, elect not to comply with certain requirements of the NYSE corporate governance standards, including (i) the requirement that a majority of the board of directors consist of independent directors, (ii) the requirement that we have a compensation committee that is composed entirely of independent directors with a written charter addressing the committee s purpose and responsibilities and (iii) the requirement that our director nominations be made, or recommended to the Board, by a nominating committee that consists entirely of independent directors and that we adopt a written charter addressing the nominations process. We may take advantage of certain of these exemptions, and, as a result, you may not have the same protections afforded to shareholders of companies that are subject to all of the NYSE corporate governance requirements. In the event that we cease to be a controlled company, we will be required to comply with these provisions within the transition periods specified in the NYSE corporate governance rules. Table of Contents
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+Prospectus Summary - Implications of Being a Smaller Reporting Company. Investing in our securities is speculative and involves a high degree of risk. You should carefully consider the risk factors beginning on page 7 of this prospectus before purchasing our securities. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Unit(1) Total Public offering price $ $ Placement agent fees(2) Proceeds to us, before expenses $ $ (1) Assumes all Units consist of one share of common stock, one Class E warrant and one Class F warrant. (2) We have agreed to pay the placement agent a cash fee equal to 7.0% of the aggregate gross proceeds raised in this offering, and to reimburse the placement agent for certain of its offering-related expenses. See Plan of Distribution for a description of the compensation to be received by the placement agent. Delivery of the securities hereby is expected to be made on or about July [ ], 2025, subject to the satisfaction of customary closing conditions. Sole Placement Agent Maxim Group LLC The date of this prospectus is July [ ], 2025. TABLE OF CONTENTS ABOUT THIS PROSPECTUS 1 PROSPECTUS SUMMARY 2
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus. It does not contain all the information you should consider before investing in our securities. You should read this entire prospectus carefully, including the sections entitled Risk Factors, Business, Management s Discussion and Analysis of Financial Condition and Results of Operations, Where You Can Find More Information, and our consolidated financial statements and related notes included elsewhere in this prospectus, before making an investment decision. In this prospectus, unless the context requires otherwise, all references to we, our, us, Allurion, the Registrant, and the Company refer to Allurion Technologies, Inc. and its consolidated subsidiaries. Overview We are dedicated to ending obesity by creating a best-in-class weight loss platform to treat the estimated two billion people globally who are overweight. Our platform, the Allurion Program (the Allurion Program ), features the world s first and only swallowable, Procedureless intragastric balloon for weight loss (the Allurion Balloon ) and offers access to artificial intelligence ( AI )-powered remote patient monitoring tools, a behavior change program, secure messaging and video telehealth that are delivered by the Allurion Virtual Care Suite ( VCS ). Over 150,000 patients have already been treated commercially with the Allurion Balloon in over 50 countries globally outside of the United States. The Allurion Balloon is swallowed as a capsule under the guidance of a health care provider without surgery, endoscopy, or anesthesia. The placement takes approximately 15 minutes during an outpatient visit (though times may vary across different outpatient offices). We believe the proprietary technologies that differentiate the Allurion Balloon enable improved safety and efficacy outcomes. In a prospective, non-randomized, open-label, registry trial, the Allurion Balloon demonstrated low device or procedure related rates of serious adverse events, which we believe compare favorably to that of our competitors. The VCS is comprised of the following tools to support patients weight loss experience, which we believe benefit both patients and health care providers: For Allurion Program patients: Every current Allurion Program patient receives an Allurion Connected Scale ( Allurion Connected Scale ) and access to our mobile app ( App ), which integrates data from the Allurion Connected Scale to conveniently monitor weight, body fat, activity, sleep, and several other critical metrics. The App can also enable secure messaging and video telehealth with the patient s care team and can deliver content from Allurion s behavior change program - a library of 100 weight loss actions related to diet, nutrition, mental health, sleep, goal setting, and a number of other topics -directly to the patient. The App is available in 15 languages. For Allurion Program providers: Every Allurion Program provider receives access to our clinic dashboard ( Allurion Insights ), which provides end-to-end remote patient monitoring powered by the Allurion Iris AI platform, which leverages machine learning to deliver key insights and streamline workflow. Allurion Insights offers real-time access to patient data and AI-powered analytics, 1:1 video telehealth and secure messaging directly to the patient s App, note functionality to keep track of patient encounters, and clinic-wide metrics that provide a snapshot of the clinic s overall performance. In addition to its use by Allurion Balloon patients, we believe the VCS can potentially be a platform for optimal long-term follow-up after other medical and surgical weight loss interventions in the future. For example, VCS includes a Treatment Tracking and Clinic-Led Onboarding feature that enables seamless onboarding and management of patients undergoing one or multiple weight loss treatments including gastric Table of Contents balloons such as the Allurion Balloon, surgery, or medications. In addition, in connection with our collaboration with Medtronic, we expect to develop bundled offerings that incorporate the VCS to onboard and manage Medtronic s patients. Further, in April 2024, we launched the VCS in the United States for patients utilizing other weight loss treatments, including anti-obesity medications and bariatric surgery. In November 2024, we launched AllurionMeds, a unique offering to patients that combines affordable and accessible weight loss medications with our AI-native platform to promote long-term weight maintenance, virtual access to dieticians, and the Allurion Connected Scale that measures not just weight but muscle and bone mass. Our Allurion Program products are currently sold in Europe, the Middle East, Africa, Latin America, Canada and the Asia-Pacific region. AllurionMeds is currently only available in the United States. Recent Developments Topline AUDACITY Trial Results On January 8, 2025, we announced topline results from our AUDACITY U.S. Food and Drug Administration ( FDA ) pivotal trial evaluating the safety and efficacy of the Allurion Balloon. The AUDACITY trial is an open-label, multicenter, randomized, controlled trial and is the first FDA pivotal trial on an intragastric balloon for weight loss to report primary outcomes beyond nine months. 550 subjects were randomized 1:1 to either two cycles of the Allurion Balloon or a control group that received moderate intensity lifestyle therapy. The AUDACITY trial achieved its responder rate co-primary endpoint by demonstrating that more than 50% of Allurion Balloon subjects lost more than 5% of their total body weight at 48 weeks (58%; p-value = 0.0089). At 48 weeks, Allurion Balloon subjects exhibited substantially greater weight loss compared to control subjects with a 3.77% mean difference in total body weight loss, resulting in a 2.69% superiority margin. This margin was less than the pre-specified 3% superiority margin needed to meet the comparative co-primary endpoint (p-value=0.1616). At 40 weeks, the 4.22% mean difference in total body weight loss between groups exceeded a 3% superiority margin. The rate of serious adverse events in Allurion Balloon subjects in the AUDACITY trial was 3.1%, the lowest reported in a pivotal FDA trial for a liquid-filled intragastric balloon indicated for weight loss. Based on the results of the AUDACITY trial, we plan to submit the fourth and final module of the premarket approval application to the FDA. Reverse Stock Split On January 3, 2025, we effectuated a reverse stock split of our common stock at a ratio of 1-for-25 (the Reverse Stock Split ). Such split was approved by our Board of Directors (the Board ) and our stockholders. As a result of the Reverse Stock Split, every 25 shares of our common stock issued or outstanding were automatically reclassified into one validly issued, fully-paid and non-assessable new share of common stock, subject to the treatment of fractional shares as described below, without any action on the part of the holders. Trading of our common stock on the NYSE commenced on a split-adjusted basis at market open on January 3, 2025. No fractional shares were issued in connection with the Reverse Stock Split. Stockholders who would otherwise have been entitled to receive fractional shares as a result of the Reverse Stock Split were automatically entitled to receive an additional fraction of a share of our common stock to round up to the next whole share. Table of Contents Proportional adjustments were also made to the number of shares of common stock awarded and available for issuance under our equity incentive plans, as well as the exercise price and the number of shares issuable upon the exercise or conversion of our outstanding stock options, restricted stock units and other equity securities under our equity incentive plans. Additionally, all outstanding convertible notes were adjusted in accordance with their terms, which, among other changes to the convertible note terms, resulted in proportionate adjustments being made to the number of shares issuable upon conversion of such convertible notes and to the conversion and redemption prices of such convertible notes. All outstanding warrants were also adjusted in accordance with their terms, which, among other changes to the warrant terms, resulted in proportionate adjustments being made to the number of shares issuable upon exercise of such warrants and to the exercise and redemption prices of such warrants. Specifically, following the effectiveness of the Reverse Stock Split, every 25 shares of our common stock that may be purchased pursuant to the exercise of public warrants represents one share of Common Stock that may be purchased pursuant to such warrants. Accordingly, each whole Public Warrant (as defined herein) will be exercisable for 0.056818 shares of common stock at an exercise price of $202.50 per share of common stock, which is based on each Public Warrant being exercisable for 1.420455 shares of common stock before the Reverse Stock Split, adjusted for the Reverse Stock Split ratio. Restructuring Plan On November 6, 2024, our Board approved a restructuring plan to reduce operating costs and better align our workforce with the needs of our business. The majority of the restructuring plan was completed in the fourth quarter of 2024. Under the restructuring plan, we anticipate reducing our workforce by approximately 113 roles (approximately 50% of our workforce). In connection with the restructuring plan, we estimate that we will incur one-time aggregate restructuring charges of approximately $3.5 million, which will be recorded primarily in the fourth quarter of 2024, related to severance payments and other employee-related costs. The cash payments related to the personnel-related restructuring will be paid primarily during the first quarter of 2025. The charges that we expect to incur in connection with the workforce reduction are subject to a number of assumptions, and actual results may differ materially. We may also incur additional costs not currently contemplated due to events that may occur as a result of, or that are associated with, the workforce reduction. Amendments to Financing Agreements Additional Revenue Interest Financing Agreement As previously announced, on February 9, 2023, Allurion Technologies, LLC ( Allurion Opco ), a Delaware limited liability company and wholly-owned subsidiary of the Company, entered into the Revenue Interest Financing Agreement, with RTW Master Fund, Ltd. and RTW Innovation Master Fund, Ltd. (as transferees of the investors initially party to the Revenue Interest Financing Agreement) (as amended from time to time, the Revenue Interest Financing Agreement ). As previously announced and in connection with the Revenue Interest Financing Agreement, the Company, Allurion Opco, RTW Master Fund, Ltd., RTW Innovation Master Fund, Ltd. and RTW Biotech Opportunities Operating Ltd. (as transferee from RTW Biotech Opportunities Ltd. (formerly known as RTW Venture Fund Limited)) (in each case, together with their successors and permitted assigns, the Additional RIFA Investors ) entered into the RTW Side Letter (as modified by that certain Amended and Restated Letter Agreement, dated as of May 2, 2023, that certain Assignment Agreement, dated as of July 28, 2023, that certain Assignment Agreement, dated as of April 9, 2024, and that certain First Amendment to Amended and Restated Letter Agreement, dated as of April 14, 2024, the Amended and Restated RTW Side Letter ). The Amended and Restated RTW Side Letter provided, among other things, that the Additional RIFA Investors may make a single election in certain circumstances to convert up to $7,500,000 of the purchase price (the Conversion Amount ) Table of Contents that the Additional RIFA Investors paid for certain shares of our common stock, into an amount of financing provided by the Additional RIFA Investors to Allurion Opco pursuant to an additional revenue interest financing agreement with Allurion Opco (the Investment Conversion ). Pursuant to the Amended and Restated RTW Side Letter, on October 22, 2024, the Additional RIFA Investors notified us of their election to exercise the Investment Conversion in full. Accordingly, on October 30, 2024, we and the Additional RIFA Investors entered into the additional Revenue Interest Financing Agreement (as amended from time to time, the Additional Revenue Interest Financing Agreement and, together with the Revenue Interest Financing Agreement, the RIFAs ). The Additional Revenue Interest Financing Agreement has substantially identical terms and conditions as the Revenue Interest Financing Agreement, except that the amount of financing provided by the Additional RIFA Investors to Allurion Opco under the Additional Revenue Interest Financing Agreement is equal to the Conversion Amount. Omnibus Amendment On January 7, 2025, the Company and Allurion Opco entered into an Omnibus Amendment (the Omnibus Amendment ) with Allurion Australia Pty Ltd, Allurion France SaS, the Additional RIFA Investors and RTW Investments, LP (together with its affiliates, RTW ), as agent for the Purchasers (in such capacity, the Principal Purchaser ), to amend the Note Purchase Agreement and the RIFAs (collectively, the Existing Documents ). The Omnibus Amendment requires (i) the Company and Allurion Opco to maintain certain minimum balances of unrestricted cash in controlled accounts in the U.S. in the amounts corresponding to the calculations set forth therein, and (ii) the Company to receive minimum trailing twelve-month consolidated Revenue (as defined in the Note Purchase Agreement) in amounts set forth therein, tested quarterly beginning with the twelve-month period ending September 30, 2025. The Omnibus Amendment also requires that (i) Allurion France will have successfully regained marketing authorization from the Agence Nationale de S curit du M dicament et des Produits de Sant to resume the Commercialization (as defined in the Existing Documents) of the Product (as defined in the Existing Documents) in France on or prior to December 31, 2025 and (ii) Allurion OpCo shall have received Marketing Authorization from the FDA for the Commercialization of the Product in the United States no later than June 30, 2026. Pursuant to the Omnibus Amendment, the Additional RIFA Investors and the Purchasers will receive a number of shares of the common stock, representing 5.0% of the fully-diluted shares outstanding (without regard to any beneficial ownership blockers) immediately after the closing of the offering and sale of Additional Shares (as defined in the Existing Documents) to be consummated no later than February 15, 2025, in connection with which the Company shall have raised at least $12,000,000 in aggregate net proceeds (the Amendment Fee ); provided that, in the event the Company cannot issue shares of common stock to the Additional RIFA Investors and the Purchasers due to applicable law, the Company shall instead issue an equivalent (as-converted) number of shares of a newly created series of Series A-1 non-voting preferred stock, par value $0.0001 per share (the Series A-1 Preferred Stock ), and the Company shall include a proposal in a definitive proxy statement on Schedule 14A seeking stockholder approval no later than December 31, 2025 to allow the conversion of Series A-1 Preferred Stock into common stock; provided further that, each share of Series A-1 Preferred Stock outstanding on December 31, 2026 (the Redemption Date ) will, except to the extent prohibited by Delaware law governing distributions to stockholders (including the Delaware General Corporation Law), be redeemed by the Company for cash in an amount equal to the as-converted value of the underlying common stock. The Omnibus Amendment also provides that the Company will ensure that RTW and the Additional RIFA Investors have the right to designate one director to the Board, which director is currently Nicholas Lewin, and as of the Amendment Effective Date (as defined in the Omnibus Amendment), also have the right to designate a second director to the Board, which additional director will initially be R. Jason Richey. Table of Contents Summary Risk Factors Investing in our securities involves risks. If any of these risks actually occur, our business, financial condition and results of operations would likely be materially adversely affected. You should carefully consider all the information contained in this prospectus before making a decision to invest in our securities. In particular, you should consider the risk factors described under Risk Factors beginning on page 14. Some of these risks related to our business, operations, financial performance and industry, as well as this offering, the concurrent private placement and our securities, are summarized below. We expect to incur losses for the foreseeable future, our ability to achieve and maintain profitability depends on the commercial success of the Allurion Balloon, and we expect our revenues to continue to be driven primarily by sales of the Allurion Balloon. We have a limited operating history and may face difficulties encountered by companies early in their commercialization in competitive and rapidly evolving markets. The failure of the Allurion Balloon or our new compounded GLP-1 program to achieve and maintain market acceptance could result in achieving sales or profitability below our expectations, which would cause our business, financial condition, and operating results to be materially and adversely affected. There is no guarantee that the FDA or non-U.S. regulatory agencies will grant approval or clearance for our current or future products, and failure to obtain regulatory approvals or clearances in the United States and other international jurisdictions, or revocation of approvals or clearances in those jurisdictions, will prevent us from marketing our products. The Allurion Balloon is not currently approved for commercial sale in the United States. Obtaining such approval is costly and time consuming, and we may not obtain the regulatory approval required to sell the Allurion Balloon in the U.S. The weight loss and obesity-management industries are highly competitive. If our competitors are able to develop and market products, whether medical devices or otherwise, that are safer, more effective, easier to use, or more readily adopted by patients and health care providers, our commercial opportunities will be reduced or eliminated. Continued international expansion of our business will expose us to business, regulatory, political, operational, financial, and economic risks associated with doing business internationally. We depend on a limited number of single source suppliers to manufacture components, sub-assemblies, and materials, which makes us vulnerable to supply shortages and price fluctuations. The regulatory approval process is expensive, time consuming, and uncertain, and may prevent us from obtaining approvals for the commercialization of the Allurion Balloon or other products. Even if we receive regulatory approval for the Allurion Balloon, we will be subject to ongoing regulatory obligations and continued regulatory review, which may result in significant additional expense and subject us to penalties if we fail to comply with applicable regulatory requirements. If patients using our products experience adverse events or other undesirable side effects, regulatory authorities could withdraw or modify our regulatory approvals, which would adversely affect our reputation and commercial prospects and/or result in other significant negative consequences. The medical device industry is characterized by patent litigation and we could become subject to adversarial proceedings or litigation that could be costly, result in the diversion of management s time and efforts, result in a loss of our intellectual property, require us to pay damages, or prevent us from marketing our existing or future products. Table of Contents If we are not able to obtain and maintain intellectual property protection for our products and technologies, if the scope of our patents is not sufficiently broad or our patents are invalidated, or if competitors gain broader patent protection, we may not be able to effectively maintain our market leading technology position. We have incurred net operating losses in the past and expect to incur net operating losses for the foreseeable future. We have a significant amount of debt, which may affect our ability to operate our business and secure additional financing in the future. We may need additional funds to support our operations, and such funding may not be available to us on acceptable terms, or at all, which would force us to delay, reduce, or suspend our planned development and commercialization efforts. Raising additional capital may subject us to unfavorable terms, cause dilution to our existing stockholders, restrict our operations, or require us to relinquish rights to our products and technologies. We receive the majority of our revenue from sales to health care providers and other third-party distributors, and the failure to collect receivables from them could adversely affect our financial position and results of operations. Our share price may be volatile, and purchasers of our securities could incur substantial losses. You will experience immediate and substantial dilution as a result of this offering and the concurrent private placement. We will have broad discretion in how we use the proceeds of this offering and the concurrent private placement and may not use these proceeds effectively, which could affect our results of operations and cause our stock price to decline. Implications of Being an Emerging Growth Company and a Smaller Reporting Company We are an emerging growth company as defined in Section 2(a) of the Securities Act of 1933 ( Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ), and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a registration statement under the Securities Act declared effective or do not have a class of securities registered under the Securities Exchange Act of 1934, as amended, the Exchange Act ) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. We have elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparability of our financial statements with another public company that is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used. Table of Contents We will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) following the fifth anniversary of the effectiveness of the registration statement filed in connection with our Business Combination, (b) in which we have total annual gross revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common equity that is held by non-affiliates exceeds $700 million as of the end of the prior fiscal year s second fiscal quarter; and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company have the meaning associated with it in the JOBS Act. As a result of this status, we have taken advantage of reduced reporting requirements in this prospectus. In particular, in this prospectus, we have not included all of the executive compensation-related information that would be required if we were not an emerging growth company. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K, which allows us to take advantage of certain exemptions from disclosure requirements, including exemption from compliance with the auditor attestation requirements of Section 404. We will remain a smaller reporting company until the last day of the fiscal year in which (i) the market value of the shares of our common stock held by non-affiliates exceeds $250 million as of the prior June 30, and (ii) our annual revenue exceeded $100 million during such completed fiscal year or the market value of the shares of our common stock held by non-affiliates exceeds $700 million as of the prior June 30. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible. Concurrent Private Placement In addition, certain funds affiliated with RTW Investments, LP ( RTW ), a significant stockholder, have indicated an interest in investing an aggregate of $1.5 million in this offering and a concurrent private placement of a newly-created series of preferred stock, the Series A-1 convertible preferred stock (the Series A-1 Preferred Stock ), together with Series A private placement warrants to purchase shares of common stock and Series B private placement warrants to purchase shares of common stock (together, the new private placement warrants ). The concurrent private placement is exempt from the registration requirements of the Securities Act of 1933, as amended (the Securities Act ). RTW is deemed to be a related party under NYSE (as defined below) listing rules, which require stockholder approval for issuances of shares of our common stock in an amount greater than 1% of the shares currently outstanding to a related party. Accordingly, in lieu of shares of our common stock, to the extent that the investment of $1.5 million in this offering at the price to the public at which the shares and accompanying common warrants are offered hereby would result in the issuance of greater than 1% of the shares currently outstanding to RTW, RTW will acquire shares of Series A-1 Preferred Stock, which shall have no voting rights and which shall automatically convert into shares of common stock upon stockholder approval of the issuance of shares upon such conversion, and upon exercise of new private placement warrants in the concurrent private placement. The consummation of the concurrent private placement is contingent on the closing of this offering and the satisfaction of certain other customary conditions. However, the consummation of this offering is not contingent on the consummation of the concurrent private placement. Because this indication of interest is not a binding agreement or commitment to purchase, RTW may decide to purchase more, less or no shares of our securities in this offering and the concurrent private placement. The placement agent will receive the same fees from any shares of common stock and accompanying common warrants sold to RTW as they will from any other shares of common stock and accompanying common warrants sold in this offering. The placement agent will not receive any fees on any shares of Series A-1 Preferred Stock and new private placement warrants sold in the concurrent private placement. See the section entitled Concurrent Private Placement. Table of Contents Company Information We were incorporated under the laws of the State of Delaware on January 25, 2023. The mailing address of our principal executive office is 11 Huron Drive, Natick, MA 01760, and the telephone number is (508) 647-4000. We file annual, quarterly and current reports, proxy statements and other information with the U.S. Securities and Exchange Commission (the SEC ). The SEC maintains an Internet website at www.sec.gov that contains reports, proxy and information statements and other information about issuers, like us, that file electronically with the SEC. We also maintain a website at www.allurion.com. We make available, free of charge, on our investor relations website at investors.allurion.com, our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to these reports as soon as reasonably practicable after electronically filing or furnishing those reports to the SEC. Information contained on or accessible through our website is not a part of or incorporated by reference into this prospectus and the inclusion of our website and investor relations website addresses in this prospectus is an inactive textual reference only. Table of Contents
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+PROSPECTUS SUMMARY 1
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+II-3 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of Shenzhen Guangdong China, on December 12, 2025. Alpha One Inc.. December 12, 2025 By: /s/ Shuhua Liu Shuhua Liu Chairman and Chief Executive Officer and Director (Principal Executive Officer) Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities and on the dates indicated. December 12, 2025 By: /s/ Shuhua Liu Shuhua Liu Chairman and Chief Executive Officer and Director (Principal Executive Officer) December 12, 2025 By: /s/ Hongyan Li Hongyan Li Chief Financial Officer (Principal Financial and Accounting Officer) II-4
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus or incorporated by reference. It may not contain all of the information that you should consider before investing in our securities. You should read this entire prospectus carefully, including the Risk Factors , Management s Discussion and Analysis of Financial Condition and Results of Operations sections, and the financial statements and related notes included or incorporated by reference herein. This prospectus includes forward-looking statements that involve risks and uncertainties. See Cautionary Statement Regarding Forward-Looking Statements. Aptose Biosciences Inc. Our Business Aptose Biosciences Inc. ( Aptose, the Company, we, us, or our ) is a science-driven clinical stage biotechnology company committed to the development and commercialization of precision medicines addressing unmet clinical needs in oncology, with an initial focus on hematology. The Company s small molecule cancer therapeutics pipeline includes products designed to provide single agent efficacy and to enhance the efficacy of other anti-cancer therapies and regimens without overlapping toxicities. The Company s executive offices are located in San Diego, California, and our head office is located in Toronto, Canada. Tuspetinib, ( Tuspetinib or TUS ), Aptose s lead program, is being developed for frontline combination therapy in newly diagnosed acute myeloid leukemia ( AML ) patients to unlock the most significant patient impact and greatest commercial opportunity. AML is a highly aggressive cancer of the bone marrow and blood, and there is a tremendous unmet need for a therapy that can extend survival of newly diagnosed AML patients and improve their quality of life. Newly diagnosed AML patients typically fail all frontline (1L) therapies, and responses to subsequent salvage therapies in the relapsed or refractory (R/R) setting are limited, highlighting the need for a more effective triple drug ( triplet ) combination therapy to increase survival in the frontline setting. Current standard of care treatment in the 1L setting for many newly diagnosed AML patients includes a doublet combination of venetoclax and a hypomethylating agent (VEN+HMA). Exploratory triplet therapies using current agents added to VEN+HMA have achieved notable response rates but are compromised because of toxicities and the limited activity across subpopulations of AML patients. In contrast, tuspetinib is a convenient, orally administered, once-daily kinase inhibitor that targets select kinases operative in AML and exerts broad activity across AML populations with adverse genetics. However, tuspetinib avoids kinases that typically cause toxicities associated with other kinase inhibitors and has demonstrated an excellent safety profile. These properties position tuspetinib as an ideal agent for addition to the VEN+HMA backbone therapy to create a superior triplet (TUS+VEN+HMA) frontline therapy to treat newly diagnosed AML. Aptose is currently conducting a Phase 1/2 clinical trial to develop Tuspetinib in the TUS+VEN+HMA triplet drug combinations in newly diagnosed AML patients, and once the study enrolls, we expect to deliver important clinical data (CR and MRD negativity rates, safety, and survival) over the following 6 to 12 months. It was essential to understand the safety, tolerability, and response activities of tuspetinib as a single agent and as the TUS+VEN doublet combination before advancing to the TUS+VEN+HMA triplet. We therefore performed a clinical trial of TUS single agent in patients with relapsed or refractory (R/R) AML and then performed a trial with the TUS+VEN doublet therapy in R/R AML patients and now have advanced the TUS+VEN+HMA frontline therapy into newly diagnosed AML patients. To be precise, we have now completed a dose escalation and dose exploration international Phase 1/2 clinical trial to assess the safety, tolerability, pharmacokinetics, pharmacodynamic responses, and efficacy of TUS single agent in patients with R/R AML. Significant bone marrow blast reductions and clinical responses without dose limiting toxicities were achieved at four dose levels across a broad diversity of mutationally-defined AML populations and with a highly favorable safety profile. Table of Contents The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission of which this prospectus is a part becomes effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to Completion, Dated February 13, 2025 PRELIMINARY PROSPECTUS 12,030,218 Common Shares This prospectus relates to the resale of up to 12,030,218 Common Shares, no par value, of Aptose Biosciences Inc. (the Common Shares ), which may be offered by Keystone Capital Partners, LLC ( Keystone , Keystone Capital Partners or the Selling Shareholder ). The Common Shares being offered by the Selling Shareholder are outstanding or issuable pursuant to the Common Share Purchase Agreement dated February 7, 2025 (the Purchase Agreement ). See The Keystone Capital Transaction for a description of the Purchase Agreement. Also, please refer to Selling Shareholder beginning on page 27. Such registration does not mean that Keystone will actually offer or sell any of these Common Shares. We will not receive any proceeds from the sales of the above Common Shares by the Selling Shareholder; however, we will receive proceeds under the Purchase Agreement if we sell Common Shares to the Selling Shareholder. Our Common Shares are listed on the Nasdaq Capital Market ( Nasdaq ), under the symbol APTO and on the Toronto Stock Exchange ( TSX ) under the symbol APS . On February 7, 2025, the last reported sale price of the Common Shares on Nasdaq was $0.178 per Common Share and on the TSX was C$0.26. The Selling Shareholder is an underwriter within the meaning of the Securities Act of 1933. The Selling Shareholder is offering these Common Shares. The Selling Shareholder may sell all or a portion of these Common Shares from time to time in market transactions through any market on which our Common Shares is then traded, in negotiated transactions or otherwise, and at prices and on terms that will be determined by the then prevailing market price or at negotiated prices directly or through a broker or brokers, who may act as agent or as principal or by a combination of such methods of sale. The Selling Shareholder will receive all proceeds from the sale of the Common Shares. For additional information on the methods of sale, you should refer to the section entitled Plan of Distribution. Investing in our Common Shares involves a high degree of risk. Review the risk factors beginning on page 17 of this prospectus carefully before you make an investment in our securities. You should read this prospectus, together with additional information described under the headings Incorporation of Certain Information by Reference and Where You Can Find More Information, carefully before you invest in any of our securities. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2025 Table of Contents regarding our growth, results of operations, performance and business prospects and opportunities. Such forward-looking statements reflect our current beliefs and are based on information currently available to us. In some cases, forward-looking statements can be identified by terminology such as may , would , could , will , should , expect , plan , intend , anticipate , believe , estimate , predict , potential , continue or the negative of these terms or other similar expressions concerning matters that are not historical facts. The forward-looking statements contained in this prospectus and in the documents incorporated by reference reflect our current views with respect to future events, are subject to significant risks and uncertainties, and are based upon a number of estimates and assumptions that, while considered reasonable by us, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause our actual results, performance or achievements to be materially different from any future results, performance, or achievements that may be expressed or implied by such forward-looking statements, including, among others: our risk of imminent bankruptcy; we need to obtain substantial funding immediately in order to continue operations and our exploration of strategic alternatives; our compliance plans to address various notifications from Nasdaq and whether such compliance plans will be accepted by Nasdaq; our ability to continue as a going concern; our lack of product revenues; our early stage of development, particularly the inherent risks and uncertainties associated with (i) developing new drug candidates generally, (ii) demonstrating the safety and efficacy of these drug candidates in clinical studies in humans, and (iii) obtaining regulatory approval to commercialize these drug candidates; our need to raise substantial additional capital in the near future and that we may be unable to raise such funds when needed and on acceptable terms; further equity financing, which may substantially dilute the interests of our existing shareholders; clinical studies and regulatory approvals of our drug candidates are subject to delays, and may not be completed or granted on expected timetables, if at all, and such delays may increase our costs and could substantially harm our business; our reliance on external contract research/manufacturing organizations for certain activities and if we are subject to quality, cost, or delivery issues with the preclinical and clinical grade materials supplied by contract manufacturers, our business operations could suffer significant harm; clinical studies are long, expensive and uncertain processes and the United States Food and Drug Administration, or FDA , or other similar foreign regulatory agencies that we are required to report to, may ultimately not approve any of our product candidates; our ability to comply with applicable regulations and standards; our inability to achieve our projected development goals in the time frames we announce and expect; difficulties in enrolling patients for clinical trials may lead to delays or cancellations of our clinical trials; our reliance on third parties to conduct and monitor our preclinical studies; our ability to attract and retain key personnel, including key executives and scientists; any misconduct or improper activities by our employees; Table of Contents Tuspetinib to date has demonstrated a favorable safety profile and has caused no drug-related QTc prolongations, liver or kidney toxicities, muscle damage, or differentiation syndrome, and no myelosuppression with continuous dosing of patients in remission. At a dose of 80 mg, tuspetinib demonstrated notable response rates in R/R AML patients that had never been treated with venetoclax (VEN-naive AML): CR/ CRh=36% among all-comers, CR/CRh=50% among patients with mutated FLT3, and CR/CRh=25% in patients with wildtype FLT3. Following completion of the single agent dose escalation and exploration trial, tuspetinib advanced into the APTIVATE expansion trial of the Phase 1/2 program to evaluate the TUS+VEN doublet in R/R AML patient populations. The TUS+VEN doublet combination therapy maintained a favorable safety profile: no new or unexpected safety signals were observed, and there were no reported drug-related adverse events of QTc prolongation, differentiation syndrome, or deaths. The TUS+VEN doublet combination also achieved significant bone marrow reductions and clinical responses in heavily pretreated R/R AML patients, including those with mutated TP53, mutated NKRAS, wildtype or mutated FLT3, and those who failed prior therapy with venetoclax ( Prior-VEN ) or FLT3 inhibitors ( Prior-FLT3i ). Collectively, the clinical safety and efficacy data with TUS single agent and TUS+VEN doublet in R/R AML patients position tuspetinib for development as the TUS+VEN+HMA triplet in newly diagnosed AML patients. Newly diagnosed AML patients are VEN-na ve, FLT3i-na ve, and HMA-na ve this patient population is expected to be highly responsive to a tuspetinib-containing triplet therapy. Based on the safety and efficacy profile of tuspetinib, we believe that tuspetinib as part of the TUS+VEN+HMA triplet, if approved, could establish a new standard of care therapy for newly diagnosed patients with mutated or unmutated FLT3 and in patients with other adverse genetic abnormalities. These beliefs related to the potential patient treatment and commercial opportunities are based on management s current assumptions and estimates, which are subject to change, and there can be no assurance that tuspetinib will ever be approved or successfully commercialized and, if approved and commercialized, that it will ever generate significant revenues. See our Risk Factors We are an early-stage development company with no revenues from product sales. and We have a history of operating losses. We expect to incur net losses and we may never achieve or maintain profitability. in our Annual Report on Form 10-K filed with the SEC on March 26, 2024, incorporated by reference in this prospectus. Luxeptinib ( LUX ) is an orally administered, highly potent kinase inhibitor that selectively targets defined clusters of kinases that are operative in hematologic malignancies. LUX has demonstrated clinical activity in R/R AML and in R/R B-cell cancer patients but was not consistently achieving the desired exposure levels to drive responses. Absorption of the original G1 formulation hindered the effectiveness of LUX, so a new G3 formulation was developed. Clinical evaluation of the G3 formulation has been completed in a single dose bioavailability study across five dose levels and then with continuous dosing using two different dose levels. The G3 formulation achieved our desired plasma exposure benchmark, with approximately 10-fold better absorption, and better tolerability than the original formulation. We are seeking alternative development paths and collaborations for LUX. Given current funding and our prioritization of tuspetinib, we have decided to pause funding the development of LUX. Tuspetinib Indication and Clinical Trials: Tuspetinib is an oral, highly potent, small molecule inhibitor of kinases operative in myeloid malignancies and known to be involved in tumor proliferation, resistance to therapy and differentiation. Preclinical in vitro and in vivo studies suggest that Tuspetinib may be an effective monotherapy and combination therapy in patients with hematologic malignancies including AML. A U.S. based Phase 1/2 clinical trial with the TUS+VEN+HMA triplet drug combinations in newly diagnosed AML patients is currently being conducted. An international Phase 1/2 clinical trial in patients with relapsed or refractory AML, in which patients received either TUS single agent Table of Contents our exposure to exchange rate risk; our ability to commercialize our business attributed to negative results from clinical trials; the marketplace may not accept our products or product candidates due to the intense competition and technological change in the biotechnical and pharmaceuticals, and we may not be able to compete successfully against other companies in our industries and achieve profitability; our ability to obtain and maintain patent protection; our ability to afford substantial costs incurred with defending our intellectual property; our ability to protect our intellectual property rights and not infringe on the intellectual property rights of others; our business is subject to potential product liability and other claims; potential exposure to legal actions and potential need to take action against other entities; commercialization limitations imposed by intellectual property rights owned or controlled by third parties; our ability to maintain adequate insurance at acceptable costs; our ability to find and enter into agreements with potential partners; extensive government regulation; data security incidents and privacy breaches could result in increased costs and reputational harm; our common share price has been and is likely to continue to be volatile; future sales of our common shares by us or by our existing shareholders could cause our common share price to drop; changing global market and financial conditions; changes in an active trading market in our common shares; difficulties by non-Canadian investors to obtain and enforce judgments against us because of our Canadian incorporation and presence; our smaller reporting company status; any failures to maintain an effective system of internal controls may result in material misstatements of our financial statements, or cause us to fail to meet our reporting obligations or fail to prevent fraud; our broad discretion in how we use the proceeds of the sale of Offered Shares our ability to expand our business through the acquisition of companies or businesses; and other risks detailed from time-to-time in our on-going filings with the SEC and Canadian securities regulators, and those which are discussed under the heading Risk Factors in this prospectus and in the documents incorporated by reference. Should one or more of these risks or uncertainties materialize, or should the assumptions described in the sections entitled Risk Factors in this prospectus and in the documents incorporated by reference underlying those forward-looking statements prove incorrect, actual results may vary materially from those described in the forward-looking statements. More detailed information about these and other factors is included in this prospectus under the section entitled Risk Factors and in the documents incorporated by reference into this prospectus. Although we have attempted to identify factors that could cause actual actions, events or results to differ materially from those Table of Contents or the TUS+VEN doublet, has been completed. That study delivered evidence of robust clinical activity, including multiple complete responses in R/R AML patients with various disease genotypes, and no toxicity trends that prevented advancement of TUS into the TUS+VEN+AZA triplet clinical study. The FDA granted orphan drug designation to tuspetinib for the treatment of patients with AML in October 2018. Orphan drug designation is granted by the FDA to encourage companies to develop therapies for the treatment of diseases that affect fewer than 200,000 individuals in the United States. Orphan drug status provides research and development tax credits, an opportunity to obtain grant funding, exemption from FDA application fees and other benefits. The orphan drug designation also provides us with seven additional years of marketing exclusivity in this indication. On December 3, 2024, the Company announced that the National Cancer Institute (NCI), part of the National Institutes of Health, and Aptose Biosciences Inc. have entered into a Cooperative Research and Development Agreement ( CRADA ). Under the CRADA, the NCI and Aptose will collaborate on the clinical development of Aptose s proprietary lead clinical-stage compound tuspetinib (TUS), an inhibitor of key signaling kinases involved in myeloid malignancies, in the NCI Cancer Therapy Evaluation Program (CTEP) sponsored myeloMATCH trials employing combinations of targeted therapy for the treatment of molecularly defined acute myeloid leukemia (AML) and myelodysplastic syndromes (MDS) populations. These trials will be conducted by NCI s National Clinical Trials Network (NCTN), with the participation of the NCI Community Oncology Research Program (NCORP) in the U.S. and Canada. The myeloMATCH precision medicine trials (NCT05564390), funded by the NCI, were officially launched on May 16, 2024. myeloMATCH aims to expedite the development of tailored drug combination treatments for patients with newly diagnosed AML and MDS and to treat patients with these aggressive cancers of the blood and bone marrow from diagnosis throughout their treatment journey. Manufacturing: Following the Tuspetinib licensing agreement between Aptose and Hanmi on November 4, 2021 (the Tuspetinib Licensing Agreement ), Aptose received from Hanmi an existing inventory of drug product expected to support continuation of the current Phase 1/2 study. The Company and Hanmi also entered into a separate supply agreement in 2022 for additional production of new drug substance and drug product to support further clinical development. Additional batches of API and drug product have been produced by other companies during 2022 and 2023. Program Updates at Recent Scientific Forums: Aptose plans to initiate the tuspetinib + venetoclax + azacitidine (TUS+VEN+AZA) triple drug combination study in newly diagnosed AML patients with 40 mg tuspetinib and then to dose escalate the tuspetinib dose to 80 mg. Safety and activity as a single agent were demonstrated with the 40 mg dose of tuspetinib in R/R AML patients. This 40 mg dose represents one dose level below the 80 mg single agent recommended phase 2 dose (RP2D) of tuspetinib in R/R AML patients, this dose escalation approach which is the typical FDA recommended starting dose for drug combination studies. In December 2024, Aptose attended the 66th Annual American Society of Hematology (ASH) Meeting and Exposition in San Diego, California, and presented a poster entitled Phase 1 Safety and Efficacy of Tuspetinib Plus Venetoclax Combination Therapy in Study Participants with Relapsed or Refractory Acute Myeloid Leukemia (AML) Support Exploration of Triplet Combination Therapy of Tuspetinib Plus Venetoclax and Azacitidine for Newly Diagnosed AML . Table of Contents described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Forward-looking statements are based upon our beliefs, estimates and opinions at the time they are made and we undertake no obligation to update forward-looking statements if these beliefs, estimates and opinions or circumstances should change, except as required by applicable law. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Forward-looking statements contained in this prospectus are made as of the date of this prospectus. Forward-looking statements made in a document incorporated by reference into this prospectus are made as of the date of the original document and have not been updated by us except as expressly provided for in this prospectus. Except as required under applicable securities legislation, we undertake no obligation to publicly update or revise forward-looking statements, whether as a result of new information, future events or otherwise. We qualify all the forward-looking statements contained in this prospectus and the documents incorporated by reference in this prospectus by the foregoing cautionary statements. ENFORCEABILITY OF CIVIL LIABILITIES We are incorporated under the laws of Canada. Many of our directors and officers and the experts named in this prospectus are residents of countries other than the United States, and all or a substantial portion of their assets and some of our assets are located outside the United States. We have appointed Aptose Biosciences U.S. Inc. as our agent for service of process in the United States, but it may be difficult for holders of securities who reside in the United States to effect service within the United States upon those directors, officers and experts who are not residents of the United States. Additionally, it may not be possible for you to enforce judgments obtained in U.S. courts based upon the civil liability provisions of the U.S. federal securities laws or other laws of the United States. In addition, there is doubt as to whether an original action could be brought in Canada against us or our directors or officers based solely upon U.S. federal or state securities laws and as to the enforceability in Canadian courts of judgments of U.S. courts obtained in actions based upon the civil liability provisions of U.S. federal or state securities laws. Table of Contents Key Findings and Messages included: TUS+VEN+AZA triplet trial is proceeding in newly diagnosed AML patients TUS+VEN retains activity in the difficult-to-treat prior-VEN AML population TUS+VEN is active in FLT3 wildtype, representing ~70% of AML patients TUS+VEN is well tolerated and can be safely co-administered TUS+VEN is active across broad populations of R/R AML Combination of TUS with VEN may avoid VEN resistance TUS+VEN+AZA triplet may establish a more effective, mutation agnostic standard of care for chemotherapy ineligible AML patients Highlights of the ASH poster presentation included TUS as Single Agent (n= 93 Patients) 60% and 42% CR/CRh with 80 mg TUS in FLT3 mutated and all-comer VEN-na ve AML 33% CRc & 42% ORR (CR, CRp, CRh, CRi or PR) in FLT3 mutated and VEN-na ve patients Includes 40, 80, 120, and 160 mg TUS dose as a single agent Includes those who failed prior therapy with venetoclax Includes those with mutated or unmutated FLT3, those who failed prior-HSCT, priorFLT3i, prior-chemotherapy, prior-HMA TUS once daily orally as a single agent achieved CR/CRh responses at four different dose levels (40, 80, 120, and 160 mg) with no dose limiting toxicities (no DLTs) TUS showed a favorable safety profile with no DLTs through 160 mg per day, and no drug related discontinuations, no QTc, no differentiation syndrome, and no deaths TUS/VEN Combination Therapy (n= 79 Patients) 40% ORR with 80 mg TUS + 400 mg VEN in FLT3 mutated patients 83% (5/6) had failed prior-VEN treatment and 50% (3/6) had failed both prior-VEN and FLT3i treatment TUS+VEN achieved responses among diverse R/R AML with adverse mutations in VEN-na ve, prior-VEN, FLT3WT, FLT3MUT, prior-FLT3 TUS+VEN showed favorable safety and tolerability with no new or unexpected safety On June 14, 2024, Aptose presented tuspetinib (TUS) clinical findings as a clinical poster presentation and preclinical findings as a e-poster at the European Hematology Association (EHA) 2024 Hybrid Congress in Madrid, Spain. Highlights of the findings include: Tuspetinib Monotherapy (TUS) and Tuspetinib + Venetoclax (TUS+VEN) Doublet Therapy Show Broad Clinical Activity and Strong Safety Data in relapsed or refractory (R/R) Acute Myeloid Leukemia (AML) and Differentiate TUS from other Investigational Drugs in AML TUS Monotherapy and TUS+VEN Doublet Therapy Active in Difficult-to-treat Genetic Subgroups, FLT3 Wildtype AML Table of Contents TUS Shown to Target VEN Resistance Mechanisms and Retain Activity on VEN-Resistant AML Cells in Preclinical Study Tuspetinib + Venetoclax + Azacitidine (TUS+VEN+AZA) Triplet Trial to Treat Newly Diagnosed AML Patients; Clinical Sites Being Activated Our APTIVATE clinical trial of Tuspetinib as a monotherapy (TUS) and in combination treatment with Venetoclax (TUS+VEN) in a very ill AML patient population, yielded excellent and consistent safety findings and demonstrated clinical activity across a broad range of AML including many with highly adverse genetic mutations. These findings supported advancement of Tuspetinib as an ideal third agent to add to a venetoclax and hypomethylating agent regimen for the frontline treatment of Newly Diagnosed AML patients. Conclusions from the clinical poster, entitled Safety and Efficacy of Tuspetinib as Monotherapy and Combined with Venetoclax in a Phase 1/2 Trial of Patients with Relapsed or Refractory (R/R) Acute Myeloid Leukemia include: Extensive dose exploration was performed with TUS (93 patients) and TUS+VEN (79 patients) in highly treatment experienced R/R AML patients (prior VEN, FLT3i, HMA, chemotherapy, HSCT) TUS monotherapy achieved complete remissions at 40, 80, 120, and 160 mg with no DLT, achieved a 42% CRc and 50% ORR in VEN na ve and FLT3-mutation harboring patients, and achieved responses in patients harboring highly adverse genetics (TP53MUT, RASMUT, other) TUS+VEN Doublet remained safe and well tolerated (40mg TUS + 400mg VEN | 80mg TUS + 400mg VEN), and achieved bone marrow blast reductions and responses among diverse R/R AML patients with adverse mutations and prior failure of VEN TUS targets known VEN resistance mechanisms in vitro and is clinically active in both FLT3MUT & FLT3WT R/R AML populations even after prior VEN exposure. The greatest unmet medical need in AML is for an improved frontline therapy in Newly Diagnosed AML patients. Tuspetinib is now being developed as the TUS+VEN+HMA to establish a new standard of care for the treatment of these Newly Diagnosed AML patients that may increase response rates, extend survival, safely improve quality of life, treat a broad spectrum of genetically unique AML patient populations, and blunt the development of resistance to Venetoclax. Progress has been made with VEN+HMA in 1L therapy but 1/3 do not respond and median OS <15 months with <25% alive at 3-years. Response rates and OS need improvement, especially in adverse genetic subgroups Emergence of VEN resistance via RAS/MAPK, TP53, and FLT3 clonal expansion, among other mechanisms, leads to relapse or refractory (R/R) AML that does not respond well to subsequent salvage therapies in R/R setting. A 3rd agent is needed to boost responses with VEN+HMA standard of care therapy. We believe Tuspetinib is the ideal 3rd Agent for Addition to VEN+AZA to Treat Newly Diagnosed AML TUS has excellent safety alone and in combination with VEN when co-administered TUS has broad activity across genetic subgroups including TP53, RAS/MAPK, & FLT3 mutants TUS mechanism may minimize drug resistance to VEN via inhibition of key AML kinases TUS can be administered with or without food allowing co-administration with VEN Preliminary PK data suggest no clinically meaningful interaction between TUS and VEN requiring dose modification for co-administration. Table of Contents In addition to the Tuspetinib clinical poster, a separate preclinical abstract was published as an e-poster publication at EHA, entitled Tuspetinib Retains Nanomolar Potency Against AML Cells Engineered to Express the NRAS G12D Mutation or Selected for Resistance to Venetoclax . The study demonstrated that TUS targets known venetoclax (VEN) resistance mechanisms, retaining nanomolar potency against AML cells engineered to express the NRAS-G12D mutation or selected for resistance to VEN, and in combination with VEN, could prevent emergence of resistance to both agents. TUS resistant cells showed hypersensitivity to VEN such that treatment with both drugs could also interfere with the emergence of TUS resistance. On March 26, 2024, Aptose announced that more than 170 patients to date received TUS alone or in combination with the BCL-2 inhibitor venetoclax (VEN) during the Phase 1/2 clinical program in the very ill relapsed or refractory (R/R) AML patient population. At the single agent 80 mg dose, TUS achieved a favorable safety profile and an impressive response rate among patients who were naive to VEN. The safety profile of TUS remained favorable when TUS was combined with VEN in R/R AML patients, and responses were achieved in both patients naive to VEN and those who failed prior therapy with VEN. TUS avoids many typical toxicities observed with other agents and achieves broad activity across AML patients with a diversity of adverse genetic abnormalities. On December 9, 2023, Aptose featured tuspetinib in an oral presentation at the 65th American Society of Hematology (ASH) Annual Meeting and Exposition and announced that a growing body of clinical data for Aptose s lead compound tuspetinib, demonstrates significant benefit as a single agent and in combination with venetoclax in patients with R/R AML in the ongoing APTIVATE Phase 1/2 study. Data were presented in an oral presentation by lead investigator Naval G. Daver, M.D., Professor, Director Leukemia Research Alliance Program, Department of Leukemia, The University of Texas MD Anderson Cancer Center, Houston, TX. Dr. Daver reported data from more than 100 relapsed/refractory patients from multiple international clinical sites, who had failed prior therapy and then were treated with TUS as a single agent or TUS+VEN. Both TUS and TUS+VEN delivered multiple composite complete remissions (CRc) in this very ill AML population, while maintaining a favorable safety profile across all treated patients. The data demonstrated tuspetinib is active and well tolerated in one of the most challenging and heterogeneous disease settings in oncology relapsed and refractory AML. Tuspetinib demonstrated broad activity, including activity in patients with FLT3 wild-type AML (accounting for more than 70% of the AML population), FLT3 mutated AML, NPM1 mutated AML, as well as in patients with mutations historically associated with resistance to targeted therapy. Most notably, TUS targets VEN resistance mechanisms, enabling TUS+VEN uniquely to treat the very ill prior-VEN AML population, including both FLT3 mutant and FLT3 wildtype disease. From a broader perspective, the growing body of antileukemic activity, and continued favorable safety profile, support advancement of tuspetinib in a TUS+VEN+HMA triplet for the treatment of frontline newly diagnosed AML patients. Dr. Daver also pointed out that while patients on the TUS+VEN therapy are early in their treatment cycles, most achieving a response remained on treatment and that responses have begun to mature as dosing continues. Highlights of Dr. Daver s ASH oral presentation include: As a single agent at therapeutic doses of 80-160 mg in 68 evaluable patients, TUS was more active in VEN-naive patients, with an overall CRc rate of 29% (8/28). This included a 42% CRc rate (5/12) in FLT3-mutated patients and a 19% CRc rate (3/16) in FLT3-unmutated, or wildtype, AML patients. Responses and blood counts improved with continuous dosing, many patients bridged to an allogeneic stem cell transplant ( HSCT ), durability was observed when HSCT was not performed, and 80 mg was selected as the RP2D. Overall, tuspetinib showed a favorable safety profile with only mild adverse events ( AEs ) and no dose-limiting toxicities ( DLTs ) up to 160 mg per day, and no drug discontinuations from drug-related toxicity. In the TUS+VEN doublet study, 49 patients were dosed with 80 mg of tuspetinib and 200 mg of venetoclax, with 36 evaluable (and 13 patients too early to assess). Patients were heavily exposed to Table of Contents Prior-VEN and Prior-FLT3 inhibitor treatment. TUS+VEN was active in both VEN-naive and prior Prior-VEN R/R AML patients. TUS demonstrated compelling composite complete remission (CRc) rates. Among all evaluable patients, TUS+VEN demonstrated a CRc rate of 25% (9/36); 43% (3/7) in VEN-naive patients, and 21% (6/29) in Prior-VEN patients. Among FLT3 wildtype patients, TUS+VEN demonstrated an overall CRc rate of 20% (5/25); 33% (2/6) in VEN-naive patients, and 16% (3/19) in Prior-VEN patients. Among FLT3 mutant patients, TUS+VEN demonstrated an overall CRc rate of 36% (4/11); a complete response in a VEN-naive patient (1/1); a 30% (3/10) in Prior-VEN patients; and 44% (4/9) in patients treated prior with a FLT3 inhibitor. On October 29, 2023, Aptose presented two posters related to the clinical and preclinical activity of tuspetinib at the European School of Haematology 6th International Conference: Acute Myeloid Leukemia Molecular and Translational : Advances in Biology and Treatment, held October 29-31, 2023, in Estoril, Portugal. Clinical findings included 1) data from the APTO-TUS-HV01 clinical trial (the Food Effect Study ) evaluating the pharmacokinetic (PK) properties of tuspetinib in healthy human volunteers in which tuspetinib was administered with or without food, and 2) from an international Phase 1/2 study of tuspetinib as a single agent (TUS) and in combination with venetoclax in patients with R/R AML from across clinical centers in the United States, South Korea, Spain, Australia and other sites. Data from the Food Effect Study in healthy human volunteers demonstrated tuspetinib can be administered with or without food and foresee no clinically meaningful difference in exposure. This is an important finding for patient convenience, as venetoclax is dosed with food and tuspetinib can now be co-administered with venetoclax rather than in staggered dosing. Findings from the Phase 1/2 clinical trial demonstrated tuspetinib as a single agent was well-tolerated and highly active among R/R AML patients with a diversity of adverse genotypes and delivered a 42% CR/CRh cross-evaluable venetoclax (VEN) naive patients at the 80mg daily RP2D. The TUS+VEN doublet has been well tolerated in the APTIVATE international Phase 1/2 expansion trial in R/R AML patients and achieved multiple responses in patients who previously failed venetoclax ( Prior-VEN failure AML ), including Prior-VEN failure patients who also previously failed FLT3 inhibitors, all of whom represent emerging populations of high unmet medical need. Notably, tuspetinib targets venetoclax resistance mechanisms that may re-sensitize Prior-VEN failure patients to venetoclax. Separate from the clinical studies, the preclinical study (entitled: Tuspetinib Oral Myeloid Kinase Inhibitor Creates Synthetic Lethal Vulnerability to Venetoclax ) presented by Aptose during the ESH Conference investigated the effects of tuspetinib on key elements of the phosphokinome and apoptotic proteome in both parental and TUS-resistant AML cells. In parental cells, tuspetinib inhibits key oncogenic signaling pathways and shifts the balance of pro- and anti-apoptotic proteins in favor of apoptosis, suggesting that it may generate vulnerability to venetoclax. In addition, acquired resistance in the AML cells to tuspetinib generated a synthetic lethal vulnerability to venetoclax of unusually high magnitude. Concurrent administration of TUS+VEN therefore may discourage the emergence of resistance to tuspetinib during treatment. In conjunction with poster presentations at the ESH Conference, on October 30, 2023, Aptose held a Clinical Update and KOL Data Review of AML Drug Tuspetinib that was webcast and featured Dr. Naval Daver, MD, Professor, Director Leukemia Research Alliance Program, Department of Leukemia, The University of Texas MD Anderson Cancer Center, Houston, Texas. Dr. Daver is the lead investigator on Aptose s APTIVATE trial and is recognized for significant achievements in the development of novel AML treatments, including several combination therapies. Aptose presented data in 49 patients who received the TUS+VEN doublet, showing an overall response rate ( ORR ) of 48% among all patients that had achieved an evaluable stage, as well as a 44% ORR among Prior-VEN failure AML patients, including FLT3-unmutated ( wildtype ) patients (43% ORR) and FLT3-mutated patients (60% ORR), some of whom also had failed prior therapy with FLT3 inhibitors. The TUS+VEN doublet was well tolerated with no unexpected safety signals. The TUS+VEN doublet may serve the Prior-VEN failure R/R AML patients that represent a rapidly growing population that is highly refractory to any salvage therapy. The compelling data with the TUS+VEN doublet in R/R AML patients suggest a TUS+VEN+HMA triplet may also serve the needs of frontline (1L) newly diagnosed AML patients. Table of Contents Concurrent with the European Hematology Association (EHA) Annual Congress held June 8-11, 2023, Aptose held an interim clinical update webcast on June 10, 2023, to present highlights from the ongoing clinical development of tuspetinib. Aptose reported completion of the tuspetinib dose escalation and dose exploration Phase 1/2 trial in 77 R/R AML patients, tuspetinib demonstrated a favorable safety profile, and tuspetinib delivered monotherapy responses across four dose levels with no dose-limiting toxicity in mutationally diverse and difficult to treat R/R AML populations, including patients with highly adverse mutations that typically do not respond to monotherapy or combination therapy: TP53-mutated patients with a CR/CRh = 20% and RAS-mutated patients with a CR/CRh = 22%. Aptose also reported completion of a successful End of Phase 1 Meeting with the US FDA for tuspetinib, that a monotherapy RP2D was selected as 80mg daily, and that all development paths remain open, including the single arm accelerated path. Following completion of the dose escalation and dose exploration phases of the Phase 1/2 clinical program, Aptose focused attention on the tuspetinib APTIVATE expansion trial. The APTIVATE trial is designed to identify patient populations sensitive to tuspetinib monotherapy that may serve as development paths for single arm accelerated approval and to use the TUS+VEN doublet in R/R AML patients and identify patient populations of unmet need that are sensitive to the TUS+VEN doublet and can serve as development paths for accelerated and full approvals. We reported that patient enrollment in the APTIVATE expansion trial has been brisk and preliminary CR activity had already been reported in patients receiving the TUS+VEN doublet who previously failed therapy with venetoclax. During the interim clinical update webcast Aptose also reviewed clinical findings with the new G3 formulation of LUX. Aptose disclosed that continuous dosing with 50mg of the G3 formulation achieves roughly an equivalent pharmacokinetic profile as 900mg original G1 formulation, and that dose escalation with the G3 formulation was anticipated. On March 23, 2023, Aptose announced the APTIVATE Phase 1/2 expansion trial with tuspetinib had been initiated and already had treated several R/R AML patients in the monotherapy arm, and that patient enrollment had been initiated in the doublet combination treatment arm of the APTIVATE trial with the TUS+VEN doublet. Since then, patients have continued to enroll and receive tuspetinib on the monotherapy arm. Plus, enrollment and dosing of patients on the TUS+VEN doublet arm have been brisk. Clinical investigator interest for tuspetinib is evident, and early signs of antileukemic activity during the APTIVATE trial have fueled the level of excitement for the trial. Clinical responses to monotherapy with tuspetinib have been observed in a broad range of mutationally defined populations, including those with mutated forms of NPM1, MLL, TP53, DNMT3A, RUNX1, wild-type FLT3, ITD or TKD mutated FLT3, various splicing factors, and other genes. In the March 23, 2023, announcement, Aptose also highlighted an unexpected observation of a 29% CR/CRh response rate with tuspetinib monotherapy in R/R AML patients having mutations in the RAS gene or other genes in the RAS pathway. Responses in RAS-mutated patients are important because the RAS pathway is often mutated in response to therapy by other agents as the AML cells mutate toward resistance to those other agents. Collectively, these observations of broad clinical activity of tuspetinib, along with its favorable safety profile, position tuspetinib for potential accelerated development paths, as well as for doublet, triplet and maintenance therapy indications. On January 30, 2023, Aptose announced dosing of patients in the APTIVATE Phase 1/2 clinical trial of tuspetinib, and that another clinical response has been achieved by a R/R AML patient receiving 40 mg tuspetinib once daily orally in the original dose exploration trial, the second response at the recently launched low-dose 40 mg cohort. In addition, Aptose elucidated a rationale for the superior safety profile of tuspetinib. While several kinase inhibitors require high exposures that exert near complete suppression of a single target to elicit responses, those agents often cause additional toxicity because they also cause extensive inhibition of that target in normal cells. In contrast, tuspetinib simultaneously suppresses a small suite of kinase-driven pathways critical for leukemogenesis. Consequently, tuspetinib achieves clinical responses at lower exposures with less overall suppression of each pathway, thereby avoiding many of the toxicities observed with competing agents. Table of Contents Luxeptinib Given current funding and our prioritization of tuspetinib, we have decided to pause funding the development of LUX. For further information about the historical development of LUX, please refer to the Company s Annual Report on Form 10-K for the year ended December 31, 2023. Indication and Clinical Trials: LUX is an oral, highly potent kinase inhibitor that selectively targets defined kinases operative in myeloid and lymphoid hematologic malignancies. This small molecule has been evaluated in a Phase 1a/b study for the treatment of patients having R/R B-cell leukemias and lymphomas and in a Phase 1a/b study for the treatment of patients with R/R AML or hr-MDS. These clinical studies demonstrated tumor shrinkage among B-cell cancer patients, including a CR in a diffuse large B-cell lymphoma patient that was determined via biopsy analysis at the end of Cycle 22 with 900mg BID dosing of the original G1 formulation. Likewise, an MRD-negative CR in one R/R AML patient occurred with 450mg BID dosing of the original G1 formulation. Because absorption of the original G1 formulation hampered effectiveness of LUX, a new G3 formulation was developed. Enrollment of patients in the B-cell malignancy trial and the AML trial have been completed, and clinical evaluation of the G3 formulation has been completed. The G3 formulation was determined to deliver superior plasma exposure levels relative to the original G1 formulation, and any future trial with LUX should use the G3 formulation. Regarding potential next steps with LUX, recent therapeutic strategies with CLL B-cell cancer patients typically involve therapy with certain BTK inhibitors in combination with venetoclax (VEN). Drug resistance has begun to emerge in a molecularly defined subgroup of these patients, and the drug resistance has been correlated with mutations in the FLT3 receptor. Although FLT3 mutations are typically associated with AML patients, these R/R CLL prior-BTKi/Prior-VEN/FLT3-mutated patients are difficult to treat and represent a potential commercial market of approximately $200 million by 2039. The Dana Farber Cancer Institute identified this emerging patient population and has requested LUX be tested as part of an investigator sponsored trial in combination with VEN in the R/R CLL prior-BTKi/Prior-VEN/FLT3-mutated patients. Non-clinical studies are underway to position LUX+VEN for the treatment of these patients, and efforts are underway to identify sources of capital to support such a trial to develop LUX for a molecularly defined CLL subpopulation with a high unmet medical need. During the fourth quarter of 2022, we completed dosing of the first, second, third, fourth, fifth, and sixth dose levels (150 mg, 300 mg, 450 mg, 600 mg, 750 mg, and 900 mg BID, respectively) of the original G1 formulation in the Phase 1 a/b trial in patients with B-cell leukemias and lymphomas. Among enrolled patients at that time with an array of B-cell malignancies, we had observed inhibition of phospho-BTK and on-target lymphocytosis in patients with classic CLL and modest tumor reductions in patients with different tumor types, indicating target engagement and pharmacologic activity of LUX. During the ASH Annual Meeting in December 2022, we announced that a CR was achieved with a diffuse large B-cell lymphoma patient at the 900 mg dose level of the original G1 formulation, demonstrating LUX is active in certain B-cell malignancies. As part of the ongoing dose escalation of the current formulation of LUX in patients with B-cell malignancies and AML, Aptose has made significant progress in the development of a G3 formulation that could reduce total API administered, reduce pill burden, improve absorption, and increase exposure. Aptose began testing this new G3 formulation of LUX as a single dose with 72-hour pharmacokinetics ( PK ) analysis in the ongoing studies in patients with hematologic malignancies in the first half of fiscal 2022. On March 22, 2022, we announced that the preliminary PK findings with the G3 formulation were encouraging, and the exploration of the G3 formulation was ongoing. Exploration of the PK properties of single dose administration of 10mg, 20mg, 50mg, 100mg, and 200mg dose levels with the G3 formulation have been completed. On September 12, 2022 we announced that initial PK modeling studies predict up to an 18-fold improvement in plasma steady-state exposure by the G3 formulation Table of Contents relative to the original formulation, and that Aptose plans to move forward with the development of the G3 formulation in AML patients under continuous dosing conditions to determine if G3 can deliver desired exposures and clinical responses while continuing to demonstrate a favorable safety profile. On March 23, 2023, Aptose announced that during the fourth quarter of 2022, continuous dosing had been initiated with the new G3 formulation of LUX in the ongoing Phase 1 a/b clinical trial in patients with R/R AML. Initial PK data from continuous dosing of the 50 mg G3 formulation show plasma exposure levels roughly equivalent to the 900mg dose (18-fold greater dose) of the original G1 formulation. Aptose will be reviewing all data with the data monitoring committee and will make the determination to escalate and at what dose. Concurrent with the EHA Annual Congress held June 8-11, 2023, Aptose held an interim clinical update webcast on June 10, 2023. During the update, Aptose reviewed clinical findings with the new G3 formulation of LUX. Aptose confirmed that continuous dosing with 50mg of the G3 formulation in multiple patients achieves roughly an equivalent pharmacokinetic profile as 900mg original G1 formulation, and that dose escalation with the G3 formulation was anticipated. A non-clinical article was published during the first quarter of 2023 in PLoS One, a highly respected online scientific publication. Titled, LUX interferes with LYN-mediated activation of SYK and modulates BCR signaling in lymphoma, the article helps elucidate the mechanism by which LUX suppresses the B-cell receptor pathway in a manner distinct from the BTK inhibitor ibrutinib. LUX was more effective than ibrutinib at reducing both steady state and anti-IgM-induced phosphorylation of the LYN and SYK kinases upstream of BTK where ibrutinib has little or no effect, suggesting LUX can play a role in B-cell malignancies and inflammatory diseases distinct from ibrutinib and other BTK inhibitors. In a separate line of non-clinical research with LUX, a group from the University of Texas MD Anderson Cancer Center led by Dr. Michael Andreeff published an article in June 2023 in the journal Haematologica. The article was entitled Concomitant targeting of FLT3 and BTK overcomes FLT3 inhibitor resistance in acute myeloid leukemia through the inhibition of autophagy, and the findings highlight the potential for co-targeting of FLT3/BTK/aurora kinases by LUX to overcome resistance to certain FLT3 targeted therapies in AML, which is urgently needed. On March 26, 2024, Aptose announced that during 2023 and early 2024, clinical evaluation of the new G3 formulation of LUX was completed. The G3 formulation was tested in a single dose bioavailability study in 20 patients, including both B-cell cancer and AML patients, and across 5 dose levels (10mg to 200mg). The G3 formulation then was evaluated in R/R AML patients with continuous dosing using two different dose levels (50mg BID and 200mg BID) in a total of 11 patients. Data demonstrated the G3 formulation dosed at 200mg twice daily can achieve 2-3uM steady state plasma levels, with approximately 10-fold better absorption and better tolerability than the original G1 formulation. Thus, the G3 formulation achieved the desired plasma exposure benchmark and can serve as the formulation of choice for future studies with LUX. Aptose is exploring alternative development paths and collaborations to advance LUX as a single agent or in combination with VEN to treat defined R/R patient populations of high unmet need. Other corporate matters Nasdaq Nasdaq Listing Rule 5550(b)(1) On April 2, 2024, the Company received a letter (the Notification Letter ) from Nasdaq stating that the Company was not in compliance with Nasdaq Listing Rule 5550(b)(1) (the Rule ) because the stockholders equity of the Company as of December 31, 2023, as reported in the Company s Annual Report on Form 10-K, was below the minimum requirement of $2.5 million (the Stockholders Equity Requirement ). The Company s Table of Contents stockholder s equity as of June 30, 2024 was negative $2.2 million. The Company submitted a plan to regain compliance on May 17, 2024, and received an extension to September 30, 2024 to regain compliance. As of September 30, 2024, the Company had not gained compliance with the requirement. Accordingly, on October 1, 2024, the Company received a staff determination letter from the Listing Department stating that the Company did not meet the terms of the extension because it did not complete its proposed financing initiatives to regain compliance. The Company requested an appeal and hearing of the Listing Department s determination, which automatically stayed Nasdaq s delisting of the Company s common shares pending the appeal panel s decision. On October 8, 2024, the Company requested an appeal and hearing; such hearing was scheduled for November 21, 2024. The hearing request automatically stayed Nasdaq s delisting of the Company s Common Shares pending the panel s decision. On December 19, 2024, the Company announced that the panel granted the Company s request for an extension to evidence compliance with all applicable criteria for continued listing on The Nasdaq Stock Market. On or before March 31, 2025, the Company will be required to demonstrate compliance with NASDAQ Listing Rule 5550(b)(1) requiring the Company to have a minimum of $2.5 million in shareholders equity (the Equity Rule ). Nasdaq Listing Rule 5550(a)(2) On July 16, 2024, the Company received a deficiency letter (the Deficiency Letter ) from the Nasdaq, notifying the Company that, for the prior thirty consecutive business days, the closing bid price for the Company s common shares was below the minimum $1.00 per share required for continued listing on The Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2) (the Minimum Bid Price Requirement ). The Deficiency Letter had no immediate effect on the listing of the Company s common shares, and its common shares will continue to trade on The Nasdaq Capital Market and the Toronto Stock Exchange ( TSX ) under the symbol APS. The Company s listing on the TSX is independent and will not be affected by the Company s Nasdaq listing status. The Company was given 180 calendar days, or until January 13, 2025, to regain compliance with the Minimum Bid Price Requirement. If at any time before January 13, 2025, the bid price of the Company s common shares closed at $1.00 per share or more for a minimum of 10 consecutive business days, Nasdaq would have provided written confirmation that the Company regained compliance. If the Company did not regain compliance with the Minimum Bid Price Requirement by January 13, 2025, the Company may, at the discretion of Nasdaq, be afforded a second 180 calendar day period to regain compliance. To qualify for the extension, the Company was required to meet the continued listing requirement for market value of publicly held shares and all other initial listing standards for The Nasdaq Capital Market, with the exception of the bid price requirement. The Company intends to monitor the closing bid price of its common shares and may, if appropriate, consider available options, including the possibility of seeking shareholder approval of a reverse stock split, to regain compliance with the Minimum Bid Price Requirement. However, there can be no assurance that the Company will be able to regain compliance with the Minimum Bid Price Requirement or will otherwise be in compliance with other Nasdaq Listing Rules. On August 1, 2024, the Company filed a preliminary S-1 prospectus to raise financing as part of its Compliance Plan, in addition to funds raised in the June 2024 Registered Direct Offering. On August 2, 2024, the Company implemented a reduction in force with an approximate $1.2 million per annum anticipated decrease in payroll costs. On November 25, 2024, the Company closed a reasonable best efforts public offering with participation from the CEO and existing and new healthcare focused investors for the purchase and sale of 40,000,000 common shares at a price of $0.20 per share and warrants to purchase up to 20,000,000 common shares (the November 2024 Offering ). The warrants have an exercise price of $0.25 per share, are exercisable immediately and will expire five years from the issuance date. The Company received aggregate gross proceeds of $8 million, Table of Contents before deducting placement agent fees and other offering expenses. The underwriter received 1,600,000 warrants, each at an exercise price of $0.275. The underwriter warrants will expire five years from the closing date. On January 14, 2025, the Company received an additional staff determination letter from the Nasdaq Listing Qualifications Department of The Nasdaq Stock Market LLC notifying the Company that, for the last thirty (30) consecutive business days, the closing bid price for the Company s common shares have been below the minimum $1.00 per share required for continued listing on The Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(a)(2) (the Minimum Bid Price Requirement ). The Company is required to present its plan of compliance to the hearings panel. The Company has been given until March 31, 2025, to regain compliance with the Minimum Bid Price Requirement. On January 27, 2025, the Company held a Special Meeting of the shareholders of the Corporation (the Meeting ). At the Meeting, shareholders voted in favor of an amendment to the Corporation s Articles of Incorporation, as amended, to, at the discretion of the board of directors (the Board ), effect a reverse stock split at a ratio between 10-to-1 and 30-to-1, with the ratio within such range to be determined at the discretion of the Board. Facility Agreement On August 27, 2024, the Company entered into a facility agreement (the Facility Agreement ) among the Company and Hanmi Pharmaceutical Co., Ltd. (the Lender ) pursuant to which the Lender agreed to lend to the Company up to $10,000,000 (the Loan ). The Loan is secured and repayable by the Company in full on January 31, 2027 (the Maturity Date ), and may be prepaid without penalty at any time. The Loan bears interest at six percent per annum, payable in arrears every three months beginning on September 30, 2024 until the Maturity Date. If the Company and Lender amend the license agreement dated November 4, 2021 between Lender and the Company, or enter into a collaboration agreement or (the Future Collaboration Agreement ), the Loan principal and accrued and unpaid interest under the Facility Agreement (the Converted Loan Amount ) will automatically be converted to the Lender s prepayment of future milestone obligations under the Future Collaboration Agreement. Upon conversion, the Converted Loan Amount will be deemed fully paid and satisfied under the Facility Agreement, and the future milestone obligations by the Lender under the Future Collaboration Agreement will be deemed prepaid by the Lender up to the amount of the Converted Loan Amount. At-The-Market Facility On February 3, 2025, the Company entered into a sales agreement pursuant to which the Company may from time to time, sell common shares having an aggregate offering value of up to $1 million through A.G.P./Alliance Global Partners ( AGP ) on Nasdaq (the 2025 ATM Facility ). Costs associated with the proceeds consist of 3% cash commission. The Keystone Capital Transaction On February 7, 2025, the Company and Keystone entered into the Purchase Agreement, which provides that subject to the terms and conditions set forth therein, the Company may sell to Keystone up to the greater of (i) $25 million of the Common Shares and (ii) the Exchange Cap (as defined below) (subject to certain exceptions provided in the Purchase Agreement) (the Total Commitment ), from time to time during the two year term of the Purchase Agreement. Additionally, on February 7, 2025, the Company and Keystone entered into a registration rights agreement (the Registration Rights Agreement ), pursuant to which the Company agreed to file a registration statement with the SEC covering the resale of Common Shares that are issued to Keystone under the Purchase Agreement. Table of Contents Under the terms and subject to the satisfaction of the conditions set forth in the Purchase Agreement, the Company has the right, but not the obligation, to sell to Keystone, and Keystone is obligated to purchase, up to the Total Commitment. Such sales of Common Shares by the Company, if any, will be subject to certain limitations as set forth in the Purchase Agreement, and may occur from time to time, at the Company s sole discretion, over a 24-month period commencing on the date that all of the conditions to the Company s right to commence such sales are satisfied, including that the registration statement referred to above is declared effective by the SEC. Such date is referred to hereinafter as the Commencement Date . Keystone has no right to require the Company to sell any Common Shares to Keystone, but Keystone is obligated to make purchases as the Company directs, subject to satisfaction of the conditions set forth in the Purchase Agreement. Upon entering into the Purchase Agreement, the Company agreed to issue to Keystone an aggregate of 240,604 Common Shares (the Commitment Shares ) as consideration for Keystone s commitment to purchase Common Shares upon the Company s direction under the Purchase Agreement. The Company will issue 72,181 Common Shares, or 30% of the Commitment Shares, on the Commencement Date (the Initial Commitment Shares ). An additional 72,181 Common Shares, or 30% of the Commitment Shares, shall be issued to Keystone 90 days following the Commencement Date (the First Back-End Commitment Shares ). The remaining 96,242 Common Shares, or 40% of the Commitment Shares, shall be issued to Keystone 180 days following the Commencement Date (the Second Back-End Commitment Shares , together with the First Back-End Commitment Shares, the Back-End Commitment Shares ). The Company also agreed to pay Keystone up to $25,000 for its reasonable expenses under the Purchase Agreement. Under the Purchase Agreement, the Company may, at its discretion, from time to time from and after the Commencement Date, direct Keystone to purchase (a Fixed Purchase ) up to 3,333 Common Shares on any trading day on which the closing sale price of the Common Shares is not below $0.05 per Common Share on Nasdaq; provided, however that, Keystone s committed obligation under any single Fixed Purchase shall not exceed $50,000. In addition to Fixed Purchases, and provided that the Company has directed Keystone to purchase the maximum allowable amount of 50,000 Common Shares in a Fixed Purchase, the Company also may, at its discretion, from time to time from and after the Commencement Date, direct Keystone to purchase additional Common Shares on the trading day immediately following the purchase date for such Fixed Purchase (each, a VWAP Purchase ) and, under certain circumstances set forth in the Purchase Agreement, direct Keystone to purchase additional Common Shares on the same trading day as such VWAP Purchase (each, an Additional VWAP Purchase ), in each case upon the terms and subject to the conditions set forth in the Purchase Agreement. Hereinafter the Fixed Purchase, the VWAP Purchase and the Additional VWAP Purchase are collectively referred to as a Purchase . Under applicable rules of Nasdaq, in no event may the Company issue or sell to Keystone under the Purchase Agreement more than 12,030,218 Common Shares (including the Commitment Shares), which number of Common Shares is equal to 19.99% of the Common Shares outstanding immediately prior to the execution of the Purchase Agreement (the Exchange Cap ), unless (i) the Company first obtains stockholder approval to issue Common Shares in excess of the Exchange Cap in accordance with applicable Nasdaq listing rules, or (ii) at the time we have issued Common Shares equal to the Exchange Cap and at all times thereafter, the average price per Common Share for all Common Shares sold by us to Keystone under the Purchase Agreement equals or exceeds $0.05 per Common Share, such that the Exchange Cap limitation would no longer apply to issuances and sales of Common Shares by us to Keystone under the Purchase Agreement under applicable Nasdaq listing rules. The Purchase Agreement also prohibits the Company from directing Keystone to purchase any Common Shares if those Common Shares, when aggregated with all other Common Shares then beneficially owned by Keystone and its affiliates, would result in Keystone having beneficial ownership of more than 4.99% of the Table of Contents outstanding Common Shares or if such Common Shares proposed to be issued and sold would materially affect control of the company pursuant to the rules of the TSX. The net proceeds under the Purchase Agreement to the Company will depend on the frequency of sales and the number of Common Shares sold to Keystone and prices at which the Company sells Common Shares to Keystone. The Company expects that any net proceeds received by the Company from such sales to Keystone will be used for working capital and general corporate purposes. Management of the Company believes that it is in the Company s best interests to have the flexibility to sell Common Shares pursuant to the Purchase Agreement, subject to market conditions. Corporate Information Aptose is a publicly traded company governed by the Canada Business Corporations Act ( CBCA ). Our headquarters are located at 66 Wellington Street West Suite 5300, TD Bank Tower, Box 48, Toronto ON M5K 1E6, and our executive offices are located at 12770 High Bluff Drive, Suite 120, San Diego, CA 92130 (telephone: 858-926-2730). We file annual, quarterly, current reports, proxy statements and other information with the SEC. The SEC maintains an Internet site that contains our public filings and other information regarding the Company, at www.sec.gov. We make these reports available free of charge at our website http://www.aptose.com (under the Investors Financial Information caption). We are also a reporting issuer under the securities laws of every province of Canada. Table of Contents The Offering This prospectus relates to the resale by the Selling Shareholder identified in this prospectus of up to 12,030,218 Common Shares. All of the Common Shares, if and when sold, will be sold by the Selling Shareholder. The Selling Shareholder may sell the Common Shares from time to time at market prices prevailing at the time of sale, at prices related to the prevailing market price, or at negotiated prices. We will not receive any proceeds from the sale of Shares by the Selling Shareholder. Issuer Aptose Biosciences Inc. Common Shares offered by the Selling Stockholder Up to 12,030,218 Common Shares, consisting of: Up to 11,789,614 Common Shares that we may sell to the Selling Shareholder, from time to time at our sole discretion, pursuant to the Purchase Agreement, described below; and 240,604 Common Shares issued or issuable to the Selling Shareholder as consideration for its commitment to purchase Common Shares under the Purchase Agreement. Common Shares outstanding prior to this offering1 60,181,183 Common Shares Common Shares outstanding immediately after this offering 72,211,401 Common Shares, assuming the sale of 168,423 Common Shares to Keystone and issuance of the Back-End Commitment Shares. The actual number of Common Shares issued will vary depending on the sales prices under this offering, but will not be greater than an aggregate of 12,030,218 Common Shares (inclusive of the Commitment Shares and other Common Shares issued in connection with the Purchase Agreement), representing 19.99% of the Common Shares outstanding on the date of the Purchase Agreement, in accordance with Nasdaq rules, unless as otherwise set forth herein. Stock symbol Our Common Shares are listed on Nasdaq under the symbol APTO and on the TSX under the symbol APS . Use of proceeds The Selling Shareholder will receive all of the proceeds from the sale of the Common Shares offered for sale by it under this prospectus. We will not receive proceeds from the sale of the Common Shares by the Selling Shareholder through this prospectus. However, we may receive up to $25 million in gross proceeds from the sale of our Common Shares to the Selling Shareholder under the Purchase Agreement. We did not receive any cash proceeds from the issuance of the Commitment Shares to the Selling Shareholder under the Purchase Agreement. We intend to use any proceeds from the Selling Shareholder that we receive under the Purchase Agreement for working capital and general corporate purposes. See Use of Proceeds on page 20 for more information. Table of Contents
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+Prospectus Summary The Offering Founder shares conversion and anti-dilution rights on page 27, Summary The Offering Appointment and removal of directors and continuing the company outside of the Cayman Islands; Voting Rights on page 28, Risk Factors The ability of our public shareholders to exercise redemption rights with respect to a large number of our shares and the amount of deferred underwriting compensation may not allow us to complete the most desirable business combination or optimize our capital structure, and may substantially dilute your investment in us on page 52, Risk Factors We may issue additional Class A ordinary shares or preference shares to complete our initial business combination or under an employee incentive plan after completion of our initial business combination. We may also issue Class A ordinary shares upon the conversion of the Class B ordinary shares at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions contained therein. Any such issuances would dilute the interest of our shareholders and likely present other risks on page 66, Dilution on page 104 and Proposed Business Our Sponsor on page 123 for more information. In addition, our sponsor and the underwriters have committed to purchase an aggregate of 7,000,000 warrants (or 7,750,000 warrants if the underwriters over-allotment option is exercised in full), each exercisable to purchase one Class A ordinary share at $11.50 per share, at a price of $1.00 per warrant, or $7,000,000 (or $7,750,000 if the underwriters overallotment option is exercised in full), in a private placement that will close simultaneously with the closing of this offering, which we refer to collectively as the private placement warrants. Of those 7,000,000 private placement warrants (or 7,750,000 private placement warrants if the underwriters overallotment option is exercised in full), our sponsor has agreed to purchase 4,500,000 (or 4,875,000 private placement warrants if the underwriters overallotment option is exercised in full) private placement warrants and the underwriters have agreed to purchase 2,500,000 private placement warrants (or 2,875,000 private placement warrants if the underwriters overallotment option is exercised in full). Each whole private placement warrant is exercisable to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment, terms and limitations as described herein. The private placement warrants will become exercisable 30 days after the completion of our initial business combination, as described in this prospectus. The private placement warrants are identical to the public warrants sold in this offering, subject to certain limited exceptions as described in this prospectus. Our public shareholders may also experience material dilution from the exercise of such private placement warrants, which private placement warrants may be exercised on a cashless basis under the circumstances specified in the warrant agreement filed as an exhibit to the registration statement of which this prospectus forms a part. Certain accredited investors (which may include certain of our directors, non-management officers and advisors), which we refer to as the non-managing sponsor investors throughout this prospectus, have expressed an interest to purchase, indirectly through the purchase of non-managing sponsor membership interests, an aggregate of 2,908,322 of the 4,875,000 total private placement warrants to be purchased and 3,244,589 of the 9,243,333 total founder shares held by our sponsor, assuming that the underwriters over-allotment option is exercised in full. The interests of the members of our sponsor are denominated into four classes of membership units: (i) Classes A and C membership units that will represent economic interests in certain of the founder shares and private placement warrants held by our sponsor, (ii) Class B-1 membership units that will represent an economic interest in the founder shares that are not otherwise reserved for the Class A membership units and (iii) Class B-2 membership units that will represent an economic interest in the private placement warrants that are not otherwise reserved for the Class A and Class C membership units. The non-managing sponsor investors that may join the sponsor concurrently with this offering will hold Class A and Class C membership units representing their proportional interest in the founder shares and the private placement warrants while the managing members and certain members of our Table of Contents management team will hold Class B-1 and Class B-2 membership units. Pursuant to an agreement of all the members of the sponsor, the management and control of the sponsor is vested exclusively in its managing members, Hugh Cochrane (our Co-Chief Executive Officer) and Ajmal Rahman (our Co-Chief Executive Officer and Chairman). Further, the non-managing sponsor investors are not required to (i) hold any units, Class A ordinary shares or public warrants they may purchase in this offering or thereafter for any amount of time, (ii) vote any Class A ordinary shares they may own at the applicable time in favor of our initial business combination or (iii) refrain from exercising their right to redeem their public shares at the time of our initial business combination. The non-managing sponsor investors will have the same rights to the funds held in the trust account with respect to the Class A ordinary shares underlying the units they may purchase in this offering as the rights to such funds afforded to our other public shareholders. Of the non-managing sponsor investors, Romed S.p.A. has expressed an interest to purchase membership interests in our sponsor representing an economic interest in up to 674,698 founder shares held by our sponsor and 555,555 private placement warrants to be purchased by our sponsor. Each Class A membership unit will be purchased by the members of our sponsor at a price of $1.80 per Class A membership unit. As further described in Summary Our Sponsor, commencing on the date on which our securities are listed on the Nasdaq, we expect to make certain payments and reimbursements, or pay certain fees, to our sponsor, officers or directors, or our or their affiliates, including the payment to our sponsor of up to $20,000 per month for office space and administrative services. In addition, upon consummation of this offering, we will repay up to $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses. In addition, if the sponsor or any of its affiliates make any working capital loans, up to $1,500,000 of such loans may be converted into private placement warrants, at a price of $1.00 per warrant, at the option of the lender. The conversion of such working capital loans into private placement warrants may result in a material dilution of our public shareholders equity interests. See the section titled Summary Our Sponsor for more information regarding, among other things, the amount of compensation and securities received or to be received by our sponsors, their affiliates and our officers and directors. We have until the date that is 24 months from the closing of this offering or until such earlier liquidation date as our board of directors may approve, to consummate our initial business combination. If we anticipate that we may be unable to consummate our initial business combination within such period, we may seek shareholder approval to amend our amended and restated memorandum and articles of association to extend the date by which we must consummate our initial business combination. If we seek shareholder approval for an extension, holders of public shares will be offered an opportunity to redeem their shares, regardless of whether they abstain, vote for, or vote against, the proposed extension, at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (which interest shall be net of taxes paid or payable (excluding any U.S. federal excise tax on stock repurchases under the Inflation Reduction Act of 2022, or similar tax, that is imposed on us, if any)), divided by the number of then issued and outstanding public shares, subject to applicable law. If we are unable to complete our initial business combination within 24 months from the closing of this offering, or by such earlier liquidation date as our board of directors may approve, or we do not otherwise seek shareholder approval to amend our amended and restated memorandum and articles of association to further extend the time to complete our business combination, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (which interest shall be net of taxes paid or payable (excluding any U.S. federal excise tax on stock repurchases under the Inflation Reduction Act of 2022, or similar tax, that is imposed on us, if any) and up to $100,000 for liquidation expenses), divided by the number of then issued and outstanding public shares, subject to applicable law and certain conditions as further described herein. Because our sponsor, independent director nominees and board advisors acquired the founder shares at a nominal price of $25,000, or approximately $0.003 per share, our public shareholders will incur an immediate and substantial dilution upon the closing of this offering. Further, the Class A ordinary shares issuable in connection with the conversion of the founder shares may result in additional material dilution to our public shareholders due to the anti-dilution rights of our founder shares that may result in an issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion. See the sections titled Risk Factors Risks Relating to our Securities The nominal purchase price paid by our sponsor for the founder shares may result in significant dilution to the implied value of your public shares upon the consummation of our initial business combination, and our sponsor is likely to make a substantial profit on its investment in us in the event we consummate an initial business combination, even if the business combination causes the trading price of our ordinary shares to materially decline , Our initial shareholders paid an aggregate of $25,000, or approximately $0.003 per founder share and, accordingly, you will experience Table of Contents immediate and substantial dilution from the purchase of our Class A ordinary shares , Risks Relating to our Search for, and Consummation of or Inability to Consummate, a Business Combination We may issue additional Class A ordinary shares or preference shares to complete our initial business combination or under an employee incentive plan after completion of our initial business combination. We may also issue Class A ordinary shares upon the conversion of the founder shares at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions contained therein. Any such issuances would dilute the interest of our shareholders and likely present other risks and Unlike some other similarly structured special purpose acquisition companies, our initial shareholders will receive additional Class A ordinary shares if we issue certain shares to consummate an initial business combination in order to provide anti-dilution protection to our initial shareholders. The following table illustrates the difference between the public offering price per unit and our net tangible book value per share, as adjusted to reflect various potential redemption levels that may occur in connection with the closing of our initial business combination, which we refer to as Adjusted NTBVPS, on a pro forma basis to give effect to this offering and the issuance of the private placement warrants, assuming no exercise of the over-allotment option and exercise of the over-allotment option in full. Adjusted NTBVPS excludes the effect of the consummation of our initial business combination or any related transactions or expenses. See the section titled Dilution for more information. As of June 30, 2025 Offering Price of $10.00 25% of Maximum Redemption (assumes 6,250,000 or 7,187,500 public shares redeemed) 50% of Maximum Redemption (assumes 12,500,000 or 14,375,000 public shares redeemed) 75% of Maximum Redemption (assumes 18,750,000 or 21,562,500 public shares redeemed) Maximum Redemption (assumes 25,000,000 or 28,750,000 public shares redeemed) Adjusted NTBVS Adjusted NTBVPS Difference between Adjusted NTBVPS and Offering Price Adjusted NTBVPS Difference between Adjusted NTBVPS and Offering Price Adjusted NTBVPS Difference between Adjusted NTBVPS and Offering Price Adjusted NTBVPS Difference between Adjusted NTBVPS and Offering Price Assuming Full Exercise of Over-Allotment Option $ 7.23 $ 6.69 $ 3.31 $ 5.81 $ 4.19 $ 4.19 $ 5.81 $ 0.14 $ 9.86 Assuming No Exercise of Over-Allotment Option $ 7.23 $ 6.68 $ 3.32 $ 5.81 $ 4.19 $ 4.18 $ 5.82 $ 0.12 $ 9.88 Our sponsor, members of our management team, our independent director nominees and board advisors will directly or indirectly own founder shares and/or private placement warrants following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. The low price that our sponsor, executive officers and directors (directly or indirectly) paid for the founder shares creates an incentive whereby our officers and directors could potentially make a substantial profit even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. If we are unable to complete our initial business combination within 24 months of the closing of this offering, the founder shares may expire worthless, except to the extent they receive liquidating distributions from assets outside the trust account, which could create an incentive for our sponsor, executive officers and directors to complete a transaction even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Additionally, each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. Accordingly, there may be actual or potential material conflicts of interest between our sponsor, its affiliates or promoters on the one hand, and the investors in this offering on the other hand. See the sections titled Summary Initial Business Combination , The Offering Conflicts of Interest , Risk Factors Risks Relating to our Management Team Our key personnel may negotiate Table of Contents employment or consulting agreements with a target business in connection with a particular business combination, and a particular business combination may be conditioned on the retention or resignation of such key personnel. These agreements may provide for them to receive compensation following our initial business combination and as a result, may cause them to have conflicts of interest in determining whether a particular business combination is the most advantageous , Our officers and directors will allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial business combination , Our officers and directors presently have, and any of them in the future may have additional, fiduciary or contractual obligations to other entities, including other blank check companies, and, accordingly, may have conflicts of interest in allocating their time and in determining to which entity a particular business opportunity should be presented , Our officers, directors, advisors, security holders and their respective affiliates may have competitive pecuniary interests that conflict with our interests , Proposed Business Sourcing of Potential Business Combination Targets , Management Conflicts of Interest , Management Officers, Directors and Director Nominees , and Certain Relationships and Related Party Transactions . The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about _____, 2025. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. _________________________ Lead Book-Running Manager Cohen & Company Capital Markets ______, 2025 Table of Contents TABLE OF CONTENTS Page SUMMARY 1
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+PROSPECTUS SUMMARY This summary highlights selected information that is presented in greater detail elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our Class A common shares. You should read this entire prospectus carefully, including the sections titled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations and our consolidated financial statements and related notes thereto included elsewhere in this prospectus, before making an investment decision. Unless the context otherwise requires, the terms Accelerant, the Company, we, us, and our in this prospectus refer to Accelerant Holdings and its consolidated subsidiaries. Our Vision To become the preeminent specialty insurance marketplace connecting underwriters and risk capital in a transparent and modern way. Company Overview We operate a data-driven risk exchange that connects selected specialty insurance underwriters (the Sellers on our platform) with risk capital partners (the Buyers on our platform). Our Risk Exchange reduces information asymmetries and operational barriers present in the traditional insurance value chain by leveraging proprietary technology to share actionable high-fidelity data and insights with platform participants. The Accelerant Risk Exchange simplifies the traditional insurance value chain, which is fragmented, costly, and inflexible. Legacy technology, excessive intermediation, and misaligned incentives cause data leakage, high costs, and wasted resources for participants. Our technology powered platform addresses these issues by connecting specialty underwriters, typically MGAs (our Members ), and risk capital partners, including insurers, reinsurers, and institutional investors (our risk capital partners ). On the supply side of our Risk Exchange, we deliver a full service offering to our Members that includes insights and analytics, distribution management, operational resources, and the commitment of stable underwriting capacity. Our offerings free our Members to focus on growing their businesses through their core expertise of profitable underwriting. On the demand side of our Risk Exchange, we offer risk capital partners an attractive, validated, and diversified portfolio of specialty insurance premium that may otherwise be difficult to access elsewhere. Risk capital partners who provide capacity through our Risk Exchange pay us recurring fees to source, manage, and monitor risks on their behalf. The Risk Exchange portfolio s strong returns to date promote confidence from these risk capital partners in the quality of the portfolio s risk exposure, leading to better pricing and faster execution for our Members, which, in turn, empowers our Members to focus on profitable underwriting performance and growth. By harnessing our proprietary technology, access to data, and industry experience, we believe we have created the future marketplace of the specialty insurance industry. As of March 31, 2025, we had 232 Members and 96 risk capital partners on our platform and we have grown Exchange Written Premium at a 217% compounded annual growth rate since inception. As we mature and continue to scale our business, we expect our annual growth rate to moderate. Our Risk Exchange is designed to be simpler, easier, and faster than legacy models for transferring risk. Inaccurate and incomplete underlying policy data plagues the traditional insurance value chain and prevents underwriters from deriving meaningful and actionable information. Our purpose-built Risk Exchange is underpinned by proprietary technology that ingests Member policy data and third-party data from disparate and complex data environments and pools it into a single, digestible dataset with over 21 thousand unique attributes and over 79 million rows of data as of March 31, 2025. This information enables automated portfolio monitoring and delivers actionable insights to underwriters and capital providers across the Risk Exchange, helping us drive lower-than-average loss ratios compared to the broader industry, optimized pricing, and accelerated growth. Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PROSPECTUS (Subject to Completion) Issued July 18, 2025. 28,947,368 Class A Common Shares This is the initial public offering of Class A common shares of Accelerant Holdings ( Accelerant ), par value $0.0000011951862 per share. We are offering 20,276,280 Class A common shares to be sold in this offering. The selling shareholders identified in this prospectus, including affiliates of our equity sponsor, are offering 8,671,088 of our Class A common shares. We will not receive any proceeds from the sale of our Class A common shares being sold by the selling shareholders. All shares sold by the selling shareholders in this offering will be converted to Class A common shares upon sale. Prior to this offering, there has been no public market for our Class A common shares. The initial public offering price is expected to be between $18.00 and $20.00 per Class A common share. Our Class A common shares have been approved for listing, subject to official notice of issuance, on the New York Stock Exchange ( NYSE ) under the symbol ARX. Following this offering, we will have two classes of authorized common shares. The holders of our Class A common shares offered hereby will be entitled to one vote per Class A common share, and the holders of our Class B common shares will be entitled to ten votes per Class B common share. Certain of our existing equity holders (and their affiliates) will hold all of our issued and outstanding Class B common shares and will have the right pursuant to our amended and restated memorandum and articles of association to convert their Class B common shares into Class A common shares on a one-for-one basis at any time. Additionally, Class B common shares will automatically convert into Class A common shares on a one-for-one basis upon transfer (other than a permitted transfer) of Class B common shares; or upon the earlier of (i) the time Class B common shareholders cease to own 50% of the total number of Class B common shares owned by such holders, in aggregate, immediately upon the closing of this offering or (ii) three years, after which time (in each case) there will be a single class of common shares with one vote per share. After giving effect to the sale of the Class A common shares offered hereby, investment funds controlled by our equity sponsor, Altamont Capital Partners ( Altamont Capital ), will own 100,480,382 Class B common shares, representing 79.2% of the combined voting power of our common shares outstanding after this offering (or 77.4% of the voting power if the underwriters option to purchase additional Class A common shares is exercised in full). As a result, we expect to be a controlled company within the meaning of the corporate governance standards of the NYSE. See Management Controlled Company Status. Other than Altamont Capital and any of its affiliates, no holder of common shares or any of its affiliates shall be permitted to hold voting power greater than 9.9% of the aggregate combined voting power of Accelerant (the Voting Power Threshold ), and any votes to which any such holder would otherwise be entitled in excess thereof shall be disregarded. We are an emerging growth company as defined under the U.S. federal securities laws, and as such, we have elected to comply with certain reduced reporting requirements for this prospectus and may elect to do so in future filings. Investing in our Class A common shares involves a high degree of risk. See Risk Factors beginning on page 28. Price to Public Underwriting Discounts and Commissions(1) Proceeds to Accelerant Proceeds to Selling Shareholders Per Share $ $ $ Total $ $ $ (1) See the section titled Underwriters for a description of the compensation payable to the underwriters. Certain of the selling shareholders have granted the underwriters the option for a period of 30 days to purchase up to an additional 4,342,105 Class A common shares on the same terms as set forth above. Neither the Securities and Exchange Commission ( SEC ) nor any other regulatory body has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The underwriters expect to deliver the Class A common shares to purchasers on , 2025. Morgan Stanley Goldman Sachs & Co. LLC BMO Capital Markets RBC Capital Markets Wells Fargo Securities Piper Sandler William Blair Raymond James TD Securities Citizens Capital Markets FT Partners The date of this prospectus is , 2025. Table of Contents We believe that our Members success makes us the destination of choice for the industry s best specialty underwriters. We deliver distribution management and operational, actuarial, regulatory, and stable capital support to our Members, and our holistic offering promotes our Members growth and better underwriting performance. On average, our Members grow gross premiums written through the Risk Exchange by 52% in their first two years, or at an annual rate of 39% on a weighted-average basis at low-to-mid 50-percentage loss ratios, on average. For the three months ended March 31, 2025 and the years ended December 31, 2024 and 2023, our gross loss ratio was 53%, 54% and 51%, respectively. We received an independent third-party Net Promoter Score of 89 (out of 100) from our Members (based on a survey result), which we believe will attract a robust pipeline of potential future Members. We focus on MGAs with strong underwriting track records and specialty underwriting expertise who predominately underwrite low-limit, low-hazard, specialty commercial risks. We conduct a thorough diligence process when selecting new Members for our Risk Exchange. We carefully construct the Risk Exchange portfolio to maximize diversification and predictability. Our Members had a weighted-average gross written loss ratio of approximately 50% for business written through the Risk Exchange in underwriting year 2024, and the majority of Members weighted-average gross loss ratios for underwriting year 2024 are within eight points of the weighted average, creating a low-volatility portfolio. Since our inception, we have declined approximately 90% of prospective new Members (representing self-reported premiums of $18 billion in aggregate) that we believe did not fit within our model, reflecting our selective invitation of only the best MGAs to join our Risk Exchange. Our commitment to selecting the best Members, optimizing Member performance and providing full data transparency has attracted a growing and diverse set of high-quality risk capital partners. We started with two risk capital partners in 2019, growing the number to 28 in 2020, 46 in 2021, 60 in 2022, 66 in 2023, and 96 in 2024. These risk capital partners include insurance and reinsurance companies, as well as institutional investors contributing capital to Flywheel Re, a reinsurance sidecar, who are attracted to the uncorrelated, attractive return profile of the risk that they can access through the Risk Exchange. Reinsurance companies and institutional investors in Flywheel Re access the Risk Exchange by reinsuring business from Accelerant Underwriting. Starting in 2023, five third-party insurance companies joined our platform and began accessing the Risk Exchange directly. In 2024, eight more third-party insurance companies joined, and over time we believe that the majority of our Risk Exchange premium will be written Table of Contents Our mission To be the preeminent specialty insurance marketplace Table of Contents by new and existing third-party insurance company partners. The depth and breadth of risk capital partners supports our operational flexibility and our growing Member base. It also allows us to maintain a capital light model. The Risk Exchange is our fee-based core business. At opposite ends of the Risk Exchange, we operate our MGA Operations and Underwriting segments, further enhancing our value proposition. Our MGA Operations segment includes our MGA incubator, Mission Underwriters, which has supported the formation of 31 MGAs (our Mission Members ). Mission Underwriters expands our addressable market to include underwriters presently employed by traditional insurance companies looking to form their own MGAs. In addition to Mission Members, the MGA Operations segment also captures the financial contributions of 16 Members in which we own an equity ownership interest (our Owned Members ). Our selective equity participation allows us to make attractive investments in, and further align with, Members, enabling us to capture some of the value we help create. In nearly every instance (with only two exceptions), the MGAs in which we have invested were already Members at the time of our investment. On average, our investment in a Member has taken place nine months after the MGA became a Member. In total, we own an equity ownership interest, either directly or through Mission, in 47 of our 232 Members, and we expect our Owned Members and Mission Members in aggregate to remain a minority portion of our total Members. For the trailing twelve months ended March 31, 2025, these Members contributed $1.03 billion, in Exchange Written Premium, or 29% of our total Exchange Written Premium for that period. Our Underwriting segment captures the portion of the Risk Exchange portfolio written by Accelerant Underwriting and the corresponding underwriting profit realized on retained business. We have historically targeted to reinsure 90% of premiums written and reinsured by Accelerant Underwriting through the Risk Exchange to risk capital partners, with Accelerant retaining approximately 10%. We expect this retained portion of Risk Exchange premium in the aggregate to decrease over time. We view our Underwriting segment as a strategic asset and source of operational flexibility that we use to broaden the risk capital pool, align incentives with current and prospective risk capital partners and expedite the onboarding of new Members and the launch of new products. As of December 31, 2019, we had 12 Members, writing 60 products across seven countries, and two risk capital partners. As of March 31, 2025, we have grown our platform to 232 Members, writing over 500 specialty insurance products across 22 countries, on behalf of 96 risk capital partners. Since the launch of our platform, only one Member has elected to leave the Risk Exchange based on mutual agreement. In all, we have experienced less than a 1% churn rate in the period from inception of the Risk Exchange through March 31, 2025. We have grown total Exchange Written Premium to $3.5 billion for the trailing twelve months ended March 31, 2025, while achieving a gross loss ratio of 53% for the three months ended March 31, 2025, 54% for 2024 and 51% for 2023. We have grown our revenues by 57% from $219 million for the year ended December 31, 2022 to $344 million for the year ended December 31, 2023, by 75% from $344 million for the year ended December 31, 2023 to $603 million for the year ended December 31, 2024, and by 39% from $128 million for the three months ended March 31, 2024 to $178 million for the three months ended March 31, 2025. Our Organic Revenue Growth Rate over the same periods was 57%, 75%, and 38%, respectively. In 2022 and 2023, we incurred net losses of $96 million and $64 million, respectively, reflecting increased investment into our business. For the year ended December 31, 2024, we reported net income of $23 million. We reported net income of $8 million and $2 million for the three months ended March 31, 2025 and 2024, respectively. Our Adjusted EBITDA was $128 million for the trailing twelve months ended March 31, 2025. We generated positive Adjusted EBITDA in 2024 and 2023 of $113 million and $36 million, respectively, which followed Adjusted EBITDA losses of $39 million in 2022. For reconciliations of total revenue to Organic Revenue Growth Rate and net income (loss) to Adjusted EBITDA, see Management s Discussion and Analysis of Financial Condition and Results of Operations Reconciliation of Non-GAAP financial measures. Table of Contents A bird s eye view of Accelerant $3.5B 96 Exchange Written Premium1 Risk Capital Partners2 232 Operating in 20+ Members 2 Countries 2 (1) For the trailing 12 months ended March 31, 2025 (2) As of March 31, 2025 Table of Contents Our History Accelerant was founded in 2018 by three industry veterans with over 100 years of collective experience in the insurance and reinsurance industries. They experienced first-hand the structural inefficiencies and fragmentation of the insurance market. There were too many intermediaries operating across siloed entities, resulting in a lack of customer prioritization and excess costs. Antiquated technology, poor data quality, and insufficient transparency has led to information asymmetries, inaccurate pricing, misaligned incentives, and inconsistent capital availability. Our founders were determined to build a platform to solve these issues. By democratizing data and aligning incentives in a single platform, Accelerant strives to deliver better outcomes for all Risk Exchange participants. In late 2018, we launched operations in Europe, followed quickly by the formation of our first insurance company in 2019. We believed that controlling our own insurance company would kickstart our marketplace initially and provide our Members with the support and service to empower them to focus on profitably growing their businesses. We established relationships with risk capital partners that valued our disciplined approach to sourcing, managing, and monitoring specialty risk. They indirectly provided capacity through reinsurance to support our Members growing premium base while we maintained our capital-efficient, distribution-focused business model. Simultaneously, we built portfolio analytics and automated monitoring to augment the quality of the portfolio and the underwriting insights that support it. By the end of 2020, we had expanded our footprint into the United States. Recognizing the significant opportunity to attract underwriting teams out of traditional insurance companies, where underwriters had limited upside, our affiliates launched Mission Underwriters in 2021. Mission Underwriters, our MGA incubator, provides start-up financing, underwriting capacity, and turnkey operational support to entrepreneurial underwriters seeking to launch their own MGAs. By the end of 2021, there were five Mission Members that wrote $28 million of GWP in 2021 and grew to 31 Mission Members writing $623 million of GWP for the trailing twelve months ended March 31, 2025. With respect to technology, we made significant enhancements in 2021 to our data ingestion engine, allowing us to ingest Member data from disparate and complex data environments and to augment it with third-party data. In 2022, we formed Flywheel Re, a reinsurance sidecar, to facilitate the participation of institutional investors in the Risk Exchange portfolio, offering them specialty insurance risk and returns that are uncorrelated with broader financial markets. We believe Flywheel Re incorporates a structure that provides multi-year underwriting capacity to support the Risk Exchange platform portfolio as it grows. We expect Flywheel Re s future cash flows and investor returns to be dependent on the loss performance of the underlying portfolio of specialty insurance business the vehicle reinsures and, therefore, relatively uncorrelated with movements or trends in the broader financial markets. While the initial Flywheel Re reinsurance treaty expired in June 2025, we raised additional capital from new and existing institutional investors, extending and upsizing Flywheel Re in June 2025. Table of Contents Accelerant Table of Contents In 2023, we further evolved the Risk Exchange by allowing third-party insurance companies to join and access the Risk Exchange directly, as well as benefit from our profitable, thoughtfully sourced, managed, and monitored specialty risk portfolio. For the trailing twelve months ended March 31, 2025, Risk Exchange Insurers contributed 18% of total Exchange Written Premium, reflecting strong demand for our unique value proposition. If all of our new and existing Risk Exchange Insurers had been participating on the Risk Exchange for the trailing twelve months ended March 31, 2025, then those Risk Exchange Insurers would have written 30% of our Exchange Written Premium over that period. As part of our strategy to engage with Risk Exchange Insurers, we offer quota share reinsurance contracts to these partners or help them establish reinsurance relationships with other risk capital partners. Risk Exchange Insurers will often reinsure a significant portion of the acquired policies while gaining experience with the Risk Exchange. Our target is for Risk Exchange Insurers to write and retain an increasing percentage of our Exchange Written Premium and the capital requirements of our enterprise to further decline over time. Our Revenue Model We generate revenue through three separate operating segments: Exchange Services, MGA Operations, and Underwriting. Our Exchange Services segment generates revenue through a fixed-percentage, volume-based fee that our risk capital partners pay to us for sourcing, managing, and monitoring the portfolio of business written by Members. Our MGA Operations segment includes both Mission Underwriters consolidated results and those of Owned Members in which we have an equity ownership interest. We generate commission revenue from those Owned and Mission Members that we consolidate and equity income from those Owned Members in which we have a non-controlling equity ownership interest. Our Underwriting segment captures the net commissions from reinsurers and the net underwriting result from retained business that is written and assumed by Accelerant Underwriting companies. Our Market Opportunity We operate within the approximately $2 trillion global P&C insurance market. In Accelerant s core geographies, the United States, Europe, Australia, and Canada, total estimated P&C premiums represented $1.4 trillion in 2022. Today, Accelerant is focused on the specialty P&C insurance market, which includes risks that are either more complex or niche than standard P&C risks and thus require unique underwriting expertise. We estimate that the specialty P&C insurance market represented approximately $252 billion of annual premium in these core geographies in 2022. Specialty underwriters are the supply side of risk in our core market. MGAs are growing underwriting market share given their relative outperformance in innovation and product design. According to Conning, the MGA market in the U.S. alone was estimated to represent over $100 billion of premiums in 2023, having grown by more than 100% from $50 billion in 2018. As the specialty insurance market has continued to mature, MGAs have captured increasingly greater market share in specific underwriting niches because they can better attract top underwriting talent and have flexible, modern technology. Insurance companies that provide coverage to the ultimate insureds, and the institutional investors and reinsurers that provide reinsurance to those insurance companies, serve as the demand side of the market. Our Risk Exchange sits in the middle, serving both the supply-side and the demand-side of this market. We also directly participate on the supply side through our MGA Operations segment and on the demand side through our Underwriting segment. Table of Contents TABLE OF CONTENTS PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/ASFH_asiafin_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/ASFH_asiafin_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/AWHL_aspira_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/AWHL_aspira_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..32594f55b2bfc43123a6ec330f2cc811043ecd10
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following summary highlights selected information contained elsewhere in or incorporated by reference into this prospectus and is qualified in its entirety by the more detailed information and financial statements included elsewhere in or incorporated by reference into this prospectus. It does not contain all the information that may be important to you and your investment decision. You should carefully read this entire prospectus, including the matters set forth under Risk Factors, and our financial statements and related notes included or incorporated by reference elsewhere in this prospectus. In this prospectus, unless context requires otherwise, references to we, us, our, Aspira, or the Company refer to Aspira Women s Health Inc., a Delaware corporation, and its subsidiaries, unless the context otherwise requires. Overview We are dedicated to the discovery, development, and commercialization of noninvasive, AI-powered tests to aid in the diagnosis of gynecologic diseases, starting with ovarian cancer. We plan to broaden our focus to the differential diagnosis of other gynecologic diseases that typically cannot be assessed through traditional non-invasive clinical procedures. We expect to continue commercializing our existing and new technology and to distribute our tests through our decentralized technology transfer service platform, Aspira Synergy. We also intend to continue to raise public awareness regarding the higher sensitivity and negative predictive value for ovarian malignancy of Ova 1 as compared to cancer antigen 125 ( CA-125 ) on its own for women with adnexal masses planned for surgery, as well as the performance of our machine learning algorithms in detecting ovarian cancer risk in different racial and ethnic populations. We plan to continue to expand access to our tests among Medicaid patients as part of our corporate mission to make the best care available to all women, and we plan to advocate for legislation and the adoption of our technology in professional society guidelines to provide broad access to our products and services. We expect our extensive experience with gynecologists and healthcare providers, along with the historical adoption of our OvaSuite tests, to continue to drive growth as we introduce new products. We believe our ability to successfully develop novel AI-enabled assays is superior to others based on our know-how and extensive experience in designing and successfully launching FDA-approved and laboratory developed blood tests to aid in the diagnosis of ovarian cancer. Moreover, our history of successfully collaborating with world-class research and academic institutions allows us to innovate and provide outstanding patient care. We own and operate Aspira Labs, Inc., a research and commercial CLIA laboratory in Texas. Our product pipeline is focused on two areas: ovarian cancer and endometriosis. In ovarian cancer, we have developed clinical data to support the use of our OvaWatch test multiple times for the monitoring of an adnexal mass. In the second quarter of 2024, we expanded the features of our commercially available OvaWatch test for monitoring of adnexal masses through periodic testing at physician prescribed intervals, marking the successful completion of the vision for OvaSuite. The successful expansion of the OvaWatch mass monitoring feature in the second quarter of 2024 resulted in a tenfold increase in the market for our tests when compared to the addressable market for Ova1Plus of approximately 200,000 to 400,000 based on patients identified for surgery. As a result, we believe the addressable market for our tests to have increased to between 2 and 4 million tests per year. Our OVAinform development program continues to progress. OVAinform is a multi-marker test that combines serum proteins, clinical data (metadata), and miRNA for assessing the risk of ovarian cancer in women with an adnexal mass. We believe that by including patients with genetic and familial risk, it will increase the addressable market to 2,800,000. In endometriosis, we are developing and intend to introduce a new non-invasive test to aid in the diagnosis of this debilitating disease that impacts millions of women worldwide. We completed the design of a protein-based non-invasive blood test to aid the detection of endometrioma, one of the most common forms of endometriosis. The algorithm was confirmed with three independent cohorts and is an important input for our ENDOinform program We are a smaller reporting company as defined in the federal securities laws and will be subject to reduced public company reporting requirements. See Prospectus Summary Implications of Being a Smaller Reporting Company. You should read this prospectus, together with the additional information described under the heading Where You Can Find More Information carefully before you invest in any of our securities. Investing in our securities is highly speculative and involves a high degree of risk. See Risk Factors beginning on page 5 of this prospectus for a discussion of information that should be considered in connection with an investment in our securities. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is December 31, 2025. focused on developing a multi-marker test that combines serum proteins, clinical data (metadata) and miRNA for the identification of endometriosis. Our endometriosis portfolio addresses an even larger addressable market. According to the U.S. Department of Health and Human Services, endometriosis affects more than 6.5 million women in the United States. We believe the proliferation of commercially available and in-development therapeutics for the treatment of endometriosis will create a significant demand for a non-invasive diagnostic. Recent Developments On December 23, 2025, the Company entered into the Purchase Agreement with Lincoln Park, pursuant to which Lincoln Park committed to purchase, at the Company s direction from time to time, up to an aggregate of $10.0 million of the Company s common stock, par value $0.001 per share (the Common Stock ), subject to the terms and conditions set forth in the Purchase Agreement. In connection therewith, the Company also entered into a registration rights agreement with Lincoln Park (the Registration Rights Agreement ), pursuant to which the Company agreed to file with the U.S. Securities and Exchange Commission (the SEC ) a registration statement covering the resale by Lincoln Park of the shares of Common Stock that have been and may be issued and sold to Lincoln Park under the Purchase Agreement, including the commitment shares described below, and to take such other actions as are reasonably necessary to maintain the effectiveness of such registration statement as provided in the Registration Rights Agreement. See The Lincoln Park Transaction for a more complete description of the foregoing. Corporate Information We were incorporated in 1993. Our principal executive offices are located at 12117 Bee Caves Road, Building III, Suite 100, Austin, Texas 78738, and our telephone number is (512) 519-0400. We maintain a website at www.aspirawh.com where general information about us is available. The information contained on our website is not incorporated by reference into this prospectus, and you should not consider any information contained on, or that can be accessed through, our website as part of this prospectus or in deciding whether to purchase our securities. Implications of Being a Smaller Reporting Company We are a smaller reporting company, meaning that the market value of our shares held by non-affiliates is less than $700 million and our annual revenue was less than $100 million during the most recently completed fiscal year. We have elected to rely on exemptions from certain disclosure requirements that are available to smaller reporting companies. Specifically, as a smaller reporting company, we may choose to present only the two most recent fiscal years of audited financial statements in this prospectus and have reduced disclosure obligations regarding executive compensation. The Offering Issuer Aspira Women s Health Inc. Shares of Common Stock Offered by the Selling Stockholder Up to 16,697,509 shares of our Common Stock, comprised of (i) up to 15,873,016 shares of Common Stock that we may elect to issue and sell to Lincoln Park as Purchase Shares, in our sole discretion from time to time after the date of this prospectus, pursuant to the Purchase Agreement; and (ii) 824,493 Commitment Shares we issued to Lincoln Park on December 23, 2025 as consideration for its irrevocable commitment to purchase our Common Stock under the Purchase Agreement, for which we will not receive any cash consideration. Number of Shares of Common Stock Outstanding Prior to this Offering(1) 43,480,411 shares, which include the Commitment Shares. Number of Shares of Common Stock to be Outstanding After this Offering(1) 59,353,427 shares, which include the Commitment Shares. Terms of Offering The selling stockholder will determine when and how it sells the Purchase Shares offered in this prospectus, as described in the Plan of Distribution. Use of Proceeds We will receive no proceeds from the sale of shares of our Common Stock by Lincoln Park pursuant to this prospectus. We may receive up to $10.0 million aggregate gross proceeds under the Purchase Agreement from any sales of shares of our Common Stock we make to Lincoln Park pursuant to the Purchase Agreement after the date of this prospectus, assuming that we sell the full amount of our Common Stock available to us that we have the right, but not the obligation to sell to Lincoln Park under the Purchase Agreement. Any proceeds that we receive from sales of shares of our Common Stock to Lincoln Park under the Purchase Agreement will be used for working capital and general corporate purposes, including investing further in research and development efforts. See Use of Proceeds for a more complete description.
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diff --git a/parsed_sections/prospectus_summary/2025/BBNX_beta_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/BBNX_beta_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2025/BDMDW_baird_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/BDMDW_baird_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..8d864e052daf244b9e0e4d9132a2ef6c38e4031d
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@@ -0,0 +1 @@
+SUMMARY OF THE PROSPECTUS 1
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diff --git a/parsed_sections/prospectus_summary/2025/BDTB_bodhi_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/BDTB_bodhi_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/BENFW_beneficien_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/BENFW_beneficien_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/BENN_bend_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/BENN_bend_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2025/BIAFW_bioaffinit_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/BIAFW_bioaffinit_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..fcc0f321d1072da355c57520d49cf9810f7fa6da
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@@ -0,0 +1,811 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary provides an overview of information appearing elsewhere in this prospectus and highlights the key aspects of this Offering. This
+summary does not contain all of the information you should consider prior to investing in our Common Stock or Warrants. You should read
+this entire prospectus carefully, including the sections titled "Risk Factors" and "Management s Discussion and
+Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and related notes appearing
+at the end of this prospectus, before making any investment decision. Our fiscal year ends on December 31. Unless the context otherwise
+requires, references to "bioAffinity," the "Company," "we," "us," and "our"
+in this prospectus refer to bioAffinity Technologies, Inc. and our consolidated subsidiaries.
+
+ 
+
+Company
+Overview
+
+ 
+
+bioAffinity
+Technologies, Inc. (the "Company," "bioAffinity," "we," or "our") develops noninvasive
+diagnostics to detect early-stage lung cancer and other diseases of the lung using flow cytometry and automated analysis developed by
+machine learning, a form of artificial intelligence ("AI"). Our diagnostic platform analyzes cell populations that are indicative
+of a specific disease and uses AI to standardize sample data analysis and patient test results. state.
+
+ 
+
+Our
+first diagnostic test, CyPath Lung, addresses the need for noninvasive detection of early-stage lung cancer. Lung cancer
+is the leading cause of cancer-related deaths worldwide. Physicians order CyPath Lung to assist in their decision-making
+in the diagnosis of patients who are at high risk for lung cancer. The CyPath Lung test enables physicians to more confidently
+identify patients who will likely benefit from timely intervention and more invasive follow-up procedures including biopsy and those
+who are likely without lung cancer and should continue screening in accordance with guidelines. CyPath Lung has been
+shown to detect lung cancer at Stage 1A, its earliest stage, and has the potential to increase overall diagnostic accuracy of lung cancer,
+which could lead to increased survival, fewer unnecessary invasive procedures, reduced patient anxiety, and lower medical costs.
+
+ 
+
+Commercial
+laboratory services, including CyPath Lung, are performed at our wholly owned subsidiary Precision Pathology Laboratory
+Services ("PPLS") which we acquired by purchasing the assets of Village Oaks Pathology Services, P.A., a Texas professional
+association d/b/a Precision Pathology Services, that included the CAP-accredited and CLIA-certified commercial laboratory it owned. We
+own and operate the clinical anatomic and clinical pathology laboratory. CyPath Lung is offered for sale to physicians
+by PPLS.
+
+ 
+
+We
+continue to advance development of our flow cytometry+AI platform for companion diagnostic tests targeted at chronic obstructive pulmonary
+disease ("COPD") and asthma. Diagnostics under development are designed to detect specific receptors in sputum that determine
+the effectiveness of new and emerging therapies for asthma and COPD that have proven to effectively treat some but not all patients.
+
+ 
+
+Through
+our wholly owned subsidiary, OncoSelect Therapeutics, LLC, we have conducted research that has led to discoveries and
+advancement of novel cancer therapeutic approaches that specifically and selectively target cancer cells. We continue to advance research
+and development for use of this technology for topical treatment of squamous cell skin cancer. We expect to present our findings at conferences
+and publish our research in peer-reviewed journals in the near future. We intend to seek strategic partners to develop our therapeutic
+discoveries which could result in broad-spectrum cancer treatments in the future.
+
+ 
+
+Recent
+Developments
+
+ 
+
+On August 12, 2025, Roberto Rios, CPA and John
+J. Oppenheimer, M.D. were appointed to our board of directors.
+
+ 
+
+On
+August 14, 2025, we completed a private placement with certain institutional and accredited investors for gross proceeds of approximately
+$1.2 million, before deducting Placement Agent fees and other estimated expenses payable by us. The offering consisted of 990 shares
+of our newly designated Series B Convertible Preferred Stock, with a par value $0.001 per share and stated value of $1,000 per share
+initially convertible into 143,476 shares of our Common Stock at an initial conversion price of $6.90 per share and (ii)
+warrants to purchase up to 223,824 shares of our Common Stock at an exercise price of $10.52 per share of Common Stock
+(the "August 2025 Warrants").
+
+ 
+
+ 3
+
+ 
+
+ 
+
+ 
+
+On
+August 14, 2025, we also completed a warrant inducement transaction with the holder of a warrant, pursuant to which such holder exercised
+for cash a total of 36,666 warrants originally issued in August 2024 and October 2024, at the reduced exercise price of $6.90
+per share, for aggregate gross proceeds of approximately $253,000. In connection with the immediate exercise of the August 2024 and October
+2024 Warrants, we issued unregistered common warrants to purchase an aggregate of up to 36,666 shares of Common Stock at an exercise
+price of $10.52 per share, which warrants are not exercisable until our stockholder approve such exercise.
+
+ 
+
+On September 2, 2025, we entered into
+agreements with the holders of our August 2025 Warrants and the warrants issued in our May 2025 public offering (the "May 2025
+Warrants") pursuant to which the Floor Price (as such term is defined in each of the August 2025 Warrants and the May 2025 Warrants)
+was increased, effective as of August 12, 2025, from $3.00 to $4.50 per share.
+
+ 
+
+On September 17, 2025, we filed with
+the Secretary of State of the State of Delaware a certificate of amendment to our certificate of incorporation to effect a one-for-thirty
+(1-for-30) reverse split of our issued and outstanding shares of Common Stock. The Reverse Stock Split became effective as of 4:01 p.m.
+Eastern Time on September 18, 2025, and our Common Stock began trading on a split-adjusted basis when Nasdaq opened on September 19,
+2025. All share and per share information in this prospectus (other than in the historical financial statements incorporated herein by
+reference) has been adjusted to reflect the reverse stock split.
+
+ 
+
+Corporate
+Information
+
+ 
+
+We
+were incorporated in the State of Delaware on March 26, 2014. Our principal executive office is located at 3300 Nacogdoches Road, Suite
+216, San Antonio, Texas 78217, and our telephone number at that address is (210) 698-5334. Our website address is https://www.bioaffinitytech.com/.
+Information contained on or that can be accessed through our website is not incorporated by reference into this prospectus. Investors
+should not consider any such information to be part of this prospectus.
+
+ 
+
+Implications
+of Being an Emerging Growth Company and a Smaller Reporting Company
+
+ 
+
+We
+qualify as an "emerging growth company" (an "EGC") as defined in the Jumpstart Our Business Startups Act of 2012
+(the "JOBS Act"). As an EGC, for up to five years, we may elect to take advantage of certain specified exemptions from reporting
+and other regulatory requirements that are otherwise generally applicable to public companies. For example, these exemptions would allow
+us to:
+
+ 
+
+ 
+ 
+ 
+ present
+ two, rather than three, years of audited financial statements with correspondingly reduced disclosure in the "Management s
+ Discussion and Analysis of Financial Condition and Results of Operations" section (the "MD&A") of this prospectus;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ defer
+ the auditor attestation requirement on the effectiveness of our system of internal control over financial reporting;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ make
+ reduced disclosures about our executive compensation arrangements; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ forego
+ the adoption of new or revised financial accounting standards until they would be applicable to private companies.
+
+ 
+ 
+
+Certain
+of these reduced reporting requirements and exemptions were already available to us due to the fact that we also qualify as a "smaller
+reporting company" under SEC rules. For instance, smaller reporting companies are not required to obtain an auditor attestation
+and report regarding internal control over financial reporting, to provide a compensation discussion and analysis, or to provide a pay-for-performance
+graph or CEO pay ratio disclosure, and they may present two, rather than three, years of audited financial statements and related MD&A
+disclosure.
+
+ 
+
+We
+may take advantage of these exemptions until such time that we are no longer an EGC. We will continue to remain an EGC until the earliest
+of the following: (i) the last day of the fiscal year following the fifth anniversary of our initial public offering; (ii) the last day
+of the fiscal year in which our total annual gross revenue is equal to or more than $1.235 billion; (iii) the date on which we have issued
+more than $1 billion in nonconvertible debt during the previous three years; or (iv) the date on which we are deemed to be a large accelerated
+filer, as defined in the Securities Exchange Act of 1934, as amended (the "Exchange Act").
+
+ 
+
+We
+are also a "smaller reporting company" as defined in the Exchange Act and have elected to take advantage of certain of the
+scaled disclosures available to smaller reporting companies. To the extent that we continue to qualify as a "smaller reporting
+company" as such term is defined in Rule 12b-2 under the Exchange Act, after we cease to qualify as an EGC, certain of the exemptions
+available to us as an EGC may continue to be available to us as a "smaller reporting company," including exemption from compliance
+with the auditor attestation requirements pursuant to the Sarbanes-Oxley Act of 2002 ("SOX") and reduced disclosure about
+our executive compensation arrangements. We will continue to be a "smaller reporting company" until we have $250 million
+or more in public float (based on our Common Stock) measured as of the last business day of our most recently completed second fiscal
+quarter or, in the event we have no public float (based on our Common Stock) or a public float (based on our Common Stock) that is less
+than $700 million, annual revenues of $100 million or more during the most recently completed fiscal year.
+
+ 
+
+ 4
+
+ 
+
+ 
+
+ 
+
+We
+may choose to take advantage of some, but not all, of the available exemptions. We have taken advantage of certain reduced reporting
+obligations in this prospectus. Accordingly, the information contained herein may be different than the information you receive from
+other public companies in which you hold stock. In addition, the JOBS Act provides that an EGC may take advantage of an extended transition
+period for complying with new or revised accounting standards, delaying the adoption of these accounting standards until they would apply
+to private companies. We have elected to avail ourselves of the extended transition period for complying with new or revised financial
+accounting standards. As a result of the accounting standards election, we will not be subject to the same implementation timing for
+new or revised accounting standards as other public companies that are not EGCs which may make comparison of our financials to those
+of other public companies more difficult.
+
+ 
+
+Summary
+of Risk Factors
+
+ 
+
+Like
+any emerging growth company, we face significant risk factors that may impede our plans for successful commercialization of our diagnostic
+and therapeutic products. These risks are discussed in detail under the "Risk Factors" discussion beginning on page 9 of
+this prospectus.
+
+ 
+
+The
+following summarizes the principal factors that make an investment in our Company speculative or risky, all of which are more fully described
+in the section below titled "Risk Factors." This summary should be read in conjunction with the section below titled "Risk
+Factors" and should not be relied upon as an exhaustive summary of the material risks facing our business. The following factors
+could result in harm to our business, reputation, revenue, financial results, and prospects, among other impacts:
+
+ 
+
+Risks
+Related to Our Financial Position
+
+ 
+
+ 
+ 
+ 
+ Our
+ business plan relies upon our ability to obtain additional sources of capital and financing.
+
+ 
+ 
+ 
+ We
+ must raise additional capital to fund our operations in order to continue as a going concern.
+
+ 
+ 
+ 
+ Our
+ limited operating history makes it difficult to evaluate our business and future prospects.
+
+ 
+ 
+ 
+ We
+ are unable to precisely estimate when we will begin to generate significant profit from PPLS.
+
+ 
+ 
+ 
+ We
+ have limited experience operating a laboratory.
+
+ 
+ 
+
+Risks
+Related to our Diagnostic Product
+
+ 
+
+ 
+ 
+ 
+ Delays
+ or difficulties in the enrollment of patients could delay or prevent regulatory approvals.
+
+ 
+ 
+ 
+ Clinical
+ trials are expensive, time-consuming, and may not be successful.
+
+ 
+
+ 
+ 
+
+ 5
+
+ 
+
+ 
+
+ 
+
+Risks
+Related to Our Diagnostic Tests
+
+ 
+
+ 
+ 
+ 
+ If
+ our tests do not perform as expected, our operating results, reputation, and business will suffer.
+
+ 
+ 
+ 
+ We
+ may experience difficulties that delay or prevent our development, introduction, or marketing of enhanced or new tests.
+
+ 
+ 
+ 
+ Clinical
+ testing of a particular diagnostic test or therapeutic product candidate may not yield successful results.
+
+ 
+ 
+ 
+ Even
+ if our diagnostic tests or therapeutic products receive marketing approval, we may not be successful in commercializing them.
+
+ 
+ 
+ 
+ We
+ are currently dependent upon PPLS to offer and perform CyPath Lung.
+
+ 
+ 
+ 
+ If
+ we cannot convince physicians of the benefits of our diagnostic tests or therapeutic products, market acceptance could be delayed.
+
+ 
+ 
+ 
+ We
+ face substantial competition.
+
+ 
+ 
+ 
+ Our
+ success depends upon our ability to retain key executives and attract and retain qualified personnel.
+
+ 
+ 
+ 
+ Our
+ lack of operating experience may make it difficult to manage our growth.
+
+ 
+ 
+ 
+ We
+ will depend on third parties to manufacture and market our diagnostic tests and to design trial protocols and monitor clinical trials.
+
+ 
+ 
+ 
+ We
+ are exposed to product liability and pre-clinical and clinical liability risks.
+
+ 
+ 
+ 
+ Our
+ failure to comply with privacy and security regulations could result in liability or reputational harm.
+
+ 
+ 
+ 
+ Our
+ ability to obtain adequate reimbursement for our diagnostic tests may impact our revenues.
+
+ 
+ 
+ 
+ Our
+ employees, consultants, partners, and vendors may engage in misconduct or other improper activities.
+
+ 
+ 
+ 
+ Failure
+ to comply with healthcare laws and regulations could result in substantial penalties.
+
+ 
+ 
+ 
+ We
+ face intense competition in the biotechnology and pharmaceutical industries.
+
+ 
+ 
+ 
+ The
+ market for our proposed tests and products is competitive and rapidly changing.
+
+ 
+ 
+ 
+ Healthcare
+ cost containment initiatives and the growth of managed care may limit our returns.
+
+ 
+ 
+ 
+ Disruption
+ of internal information technology systems will adversely affect our business.
+
+ 
+ 
+ 
+ Declining
+ general economic or business conditions may have a negative impact on our business.
+
+ 
+ 
+ 
+ Global
+ climate change and related regulations could negatively affect our business.
+
+ 
+ 
+
+Risks
+Related to the Operation of a CAP/CLIA Laboratory
+
+ 
+
+ 
+ 
+ 
+ PPLS 
+ operations depend upon the relationship of certain of our pathologists with existing customers.
+
+ 
+ 
+ 
+ PPLS
+ may be unable to maintain equipment or generate revenue when its equipment is not operational.
+
+ 
+ 
+ 
+ If
+ our sole laboratory facility becomes damaged or inoperable, loses its accreditation, or is required to vacate the facility, PPLS 
+ ability to sell its products or provide diagnostic assays and pursue its research and development efforts may be jeopardized.
+
+ 
+ 
+ 
+ Disruption
+ in the commercial courier delivery services used by PPLS to transport sputum samples could harm its business.
+
+ 
+ 
+ 
+ Security
+ breaches, data loss, and other disruptions could compromise sensitive information of PPLS business.
+
+ 
+ 
+ 
+ If
+ PPLS uses hazardous chemicals in a manner that causes injury, PPLS could be liable for damages.
+
+ 
+ 
+ 
+ If
+ PPLS is unable to successfully scale its operations to support demand, its business could suffer.
+
+ 
+ 
+ 
+ PPLS
+ must dedicate substantial time and resources to its complex billing process to be paid.
+
+ 
+ 
+ 
+ Delays
+ of third-party billing and collection providers and an in-house billing function to transmit claims to payors could have an adverse
+ effect on PPLS.
+
+ 
+ 
+
+ 6
+
+ 
+
+ 
+
+ 
+
+Risks
+Related to Intellectual Property Rights
+
+ 
+
+ 
+ 
+ 
+ If
+ we fail to comply with our obligations imposed by any intellectual property licenses with third parties that we may need in the future,
+ we could lose rights that are important to our business.
+
+ 
+ 
+ 
+ We
+ may need to obtain licenses of third-party technology that may not be available to us or available to us on reasonable terms.
+
+ 
+ 
+ 
+ Our
+ competitive position depends on protection of our intellectual property. Diagnostic tests and therapeutic products we develop could
+ be subject to infringement claims.
+
+ 
+ 
+ 
+ We
+ may become involved in lawsuits to protect or enforce our intellectual property.
+
+ 
+ 
+ 
+ If
+ we are unable to protect our trade secrets, our business and competitive position could be harmed.
+
+ 
+ 
+ 
+ Changes
+ in patent law could impair our ability to protect our tests and product candidates.
+
+ 
+ 
+ 
+ Our
+ patent protection could be reduced or eliminated for non-compliance with governmental requirements.
+
+ 
+ 
+ 
+ Patent
+ terms may be inadequate to protect our diagnostic tests or therapeutic product candidates.
+
+ 
+ 
+ 
+ Issued
+ patents could be found invalid or unenforceable.
+
+ 
+ 
+ 
+ If
+ we do not obtain patent term extension, our business may be harmed.
+
+ 
+ 
+ 
+ We
+ enjoy only limited geographical protection with respect to certain patents.
+
+ 
+ 
+ 
+ If
+ our trademarks and trade names are not adequately protected, we may not be able to build name recognition.
+
+ 
+ 
+
+Risks
+Related to Government Regulations
+
+ 
+
+ 
+ 
+ 
+ Failure
+ to comply with laws pertaining to LDTs or in vitro devices ("IVDs") could adversely affect our business.
+
+ 
+ 
+ 
+ Third-party
+ licensors of our future therapeutic products may be unable to obtain regulatory approval.
+
+ 
+ 
+ 
+ Failure
+ to obtain regulatory approval in foreign jurisdictions would prevent our product candidates from being marketed in those jurisdictions
+ that deny approval.
+
+ 
+ 
+ 
+ We
+ may never obtain approval or commercialize such products outside of the U.S.
+
+ 
+ 
+ 
+ The
+ impact of changes to healthcare policy and future healthcare reform legislation is unknown.
+
+ 
+ 
+
+Risks
+Related to Ownership of Our Common Stock and Pre-Funded Warrants
+
+ 
+
+ 
+ 
+ 
+ Our
+ failure to meet the listing requirements of The Nasdaq Capital Market could result in a de-listing of our Common Stock.
+
+ 
+ 
+ 
+ We
+ do not expect to pay dividends in the foreseeable future.
+
+ 
+ 
+ 
+ Our
+ Common Stock market price may never exceed the exercise price of our outstanding warrants.
+
+ 
+ 
+ 
+ Holders
+ of our warrants have no rights as stockholders until they exercise their warrants.
+
+ 
+ 
+ 
+ The
+ provisions of our outstanding warrants could limit a warrant holder s ability to choose the judicial forum for disputes.
+
+ 
+ 
+ 
+ The
+ financial and operational projections that we may make from time to time are subject to inherent risks.
+
+ 
+ 
+ 
+ Our
+ stock price has fluctuated in the past, has recently been volatile, and may be volatile in the future.
+
+ 
+ 
+ 
+ Our
+ Common Stock has often been thinly traded.
+
+ 
+ 
+ 
+ An
+ investment in our Company may involve tax implications.
+
+ 
+ 
+ 
+ Our
+ ability to use our net operating loss carryforwards and certain other tax attributes may be limited.
+
+ 
+ 
+ 
+ Our
+ Board can designate classes of Preferred Stock without stockholder approval.
+
+ 
+ 
+ 
+ Provisions
+ in our corporate charter documents and under Delaware law could make an acquisition of the Company more difficult.
+
+ 
+ 
+ 
+ Provisions
+ in our Charter and Amended and Restated ("A&R") Bylaws could make a merger, tender offer, or proxy contest difficult.
+
+ 
+ 
+ 
+ Certain
+ provisions of Delaware s General Corporation Law ("DGCL") may have anti-takeover effects.
+
+ 
+ 
+ 
+ Our
+ Charter designates Delaware state or federal courts as the exclusive forum for disputes.
+
+ 
+ 
+ 
+ Provisions
+ in our Charter and A&R Bylaws may discourage stockholders from bringing a lawsuit against our directors and officers.
+
+ 
+ 
+ 
+ Our
+ management collectively owns a substantial percentage of our Common Stock.
+
+ 
+ 
+ 
+ If
+ analysts publish unfavorable research, or none at all, about our business, our stock price and trading volume could decline.
+
+ 
+ 
+ 
+ Any
+ inability to report and file our financial results accurately and timely could harm our business.
+
+ 
+ 
+
+Risks
+Related to the Offering
+
+ 
+
+ 
+ 
+ 
+ This
+ is a best efforts offering, no minimum amount of securities is required to be sold, and we may not raise the amount of capital we
+ believe is required for our business plans, including our near-term business plans.
+
+ 
+ 
+ 
+ Our
+ Common Stock could be subject to extreme volatility.
+
+ 
+ 
+ 
+ Future
+ sales and issuances of our securities could result in additional dilution of the percentage ownership of our stockholders and could
+ cause our share price to fall.
+
+ 
+ 
+ 
+ Nasdaq
+ Capital Market may subsequently delist our Common Stock if we fail to comply with ongoing listing standards.
+
+ 
+
+ 
+
+ 7
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/BMNR_bitmine_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/BMNR_bitmine_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a3ac9d0f6609b8f228bcd65ac402c0980cdc4cd2
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/BMNR_bitmine_prospectus_summary.txt
@@ -0,0 +1,5566 @@
+PROSPECTUS SUMMARY
+
+ 
+
+This summary highlights selected information contained
+elsewhere in this prospectus, and does not contain all of the information that you should consider before investing in our common stock.
+This summary is qualified in its entirety by, and should be read in conjunction with, the more detailed information appearing elsewhere
+in this prospectus. You should read this entire prospectus carefully, including the information set forth in the sections titled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations and our financial
+statements and related notes thereto included elsewhere in this prospectus, before making an investment decision. Unless the context requires
+otherwise, references in this prospectus to we, us, our, our company, the Company 
+or similar terminology refer to Bitmine Immersion Technologies, Inc.
+
+ 
+
+Company Overview
+
+ 
+
+Our business strategy generally involves the accumulation
+of bitcoin for long-term investment, whether acquired by our bitcoin mining operations
+or from the proceeds of capital raising transactions. From time to time, subject to market conditions, we intend to (i) issue debt
+or equity securities or engage in other capital raising transactions with the objective of using the proceeds to purchase bitcoin, and
+(ii) expand our bitcoin mining operations and retain any bitcoin we generate to the extent it exceeds our working capital requirements.
+We intend to fund further bitcoin acquisitions and mining expansion primarily through issuances of common stock and a variety of fixed-income
+instruments, including debt, convertible notes and preferred stock. We may also finance our mining expansion by conservatively leveraging
+our bitcoin holdings. 
+
+ 
+
+We view our bitcoin holdings as long-term holdings
+and expect to continue to accumulate bitcoin. We have not set any specific target for the amount of bitcoin we seek to hold and we will
+continue to monitor market conditions in determining whether to engage in additional financings to purchase additional bitcoin. This overall
+strategy also contemplates that we may (i) periodically sell bitcoin for general corporate purposes or in connection with strategies
+that generate tax benefits in accordance with applicable law, (ii) enter into additional capital raising transactions that are collateralized
+by our bitcoin holdings, and (iii) consider pursuing strategies to create income streams or otherwise generate funds using our bitcoin
+holdings.
+
+ 
+
+Our bitcoin mining operations focus in the
+short-term on placing our new miners with third party hosting firms because we do not have the data center capacity to accommodate
+new miners. Hosting services include the provision of mining equipment and energized space and the monitoring,
+troubleshooting, and repair and maintenance of customer mining equipment. In the long-term, we plan to build data centers for
+our miners because we believe our total costs of operating the miners will be less. At present, we host approximately 9% of our
+fleet of miners and the remainder is hosted by third parties on a fee basis.
+
+ 
+
+The data centers that we build use immersion cooling
+technology. Immersion cooling is the process of submerging computer components (or full servers) in a thermally, but not electrically,
+conductive liquid (dielectric coolant) allowing higher heat transfer performance than air and many other benefits. Manufacturers of immersion
+systems report that immersion cooling, as compared to air cooling, can reduce the energy costs associated with cooling a data center by
+up to 90% and can reduce the cost of operating servers by up to 10%. In addition, manufacturers of immersion systems report the cooler,
+dust-free environment provided by immersion cooling can extend the life of data center equipment when compared to an air-cooled environment.
+
+ 
+
+Through our Mining-as-a-Service ( MaaS )
+business model, we deliver end-to-end mining infrastructure and management to companies seeking direct bitcoin mining exposure without
+the operational burden. Our MaaS strategy includes (i) hardware and infrastructure: this involves the sale or lease of mining machines,
+as well as full deployment support; (ii) operational management: this involves full fleet oversight, uptime maximization, and mining
+pool payout optimization; and (iii) financial and compliance support: this involves providing GAAP-aligned reporting tools and treasury
+integration guidance.
+
+ 
+
+We also offer bitcoin treasury consulting services
+which help companies strategically integrate bitcoin into their corporate treasury operations. This service provides guidance on
+how to acquire, store, manage, and account for bitcoin, as well as risk management and hedging strategies.
+
+ 
+
+We also
+engage in synthetic bitcoin mining through a dual approach: (i) we act as buyers when public miners pre-sell at discounted rates,
+and (ii) we pre-sell our own future hashrate (as defined below) to buyers and use the proceeds to fund new mining equipment without
+large upfront costs. Synthetic bitcoin mining is a model that allows participants to gain exposure to bitcoin mining rewards
+without operating physical mining hardware. Participants or buyers purchase a miner s hashrate via a contract where they make
+a one-time payment (in either fiat currency or bitcoin) and receive daily bitcoin rewards for the duration of the contract.
+Essentially, participants or buyers aim to purchase hashrate at a discount to the expected future bitcoin payout.
+
+ 
+
+ 
+
+ 4 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Overview of Bitcoin Industry and Market
+
+ 
+
+Bitcoin is a digital asset that is issued by and transmitted through
+an open-source protocol, known as the bitcoin protocol, collectively maintained by a peer-to-peer network of decentralized user nodes.
+This network hosts a public transaction ledger, known as the bitcoin blockchain, on which bitcoin holdings and all validated transactions
+that have ever taken place on the bitcoin network are recorded. Balances of bitcoin are stored in individual wallet functions,
+which associate network public addresses with one or more private keys that control the transfer of bitcoin. The bitcoin
+blockchain can be updated without any single entity owning or operating the network.
+
+ 
+
+New bitcoin is created and allocated by the bitcoin
+protocol through a mining process that rewards users that validate transactions in the bitcoin blockchain. Validated transactions
+are added in blocks approximately every ten minutes. The mining process serves to validate transactions and secure the bitcoin
+network. Mining is a competitive and costly operation that requires a large amount of computational power to solve complex mathematical
+algorithms. This expenditure of computing power is known as proof of work. To incentivize miners to incur the costs of mining
+bitcoin, the bitcoin protocol rewards miners that successfully validate a block of transactions with newly generated bitcoin.
+
+ 
+
+The bitcoin protocol limits the total number of
+bitcoin that can be generated over time to 21 million. As of the date of this prospectus, the reward for miners that successfully validate
+a block of transactions is 3.125 bitcoin per mined block. After every 210,000 blocks are mined, the reward from validating transactions
+is halved. A halving has historically occurred approximately every four years, and the next halving is expected to occur
+in April 2028.
+
+ 
+
+Mining requires the use of specialized computers
+equipped with application-specific integrated circuit (ASIC) chips (known as miners ) to solve complex cryptographic algorithms
+in support of the bitcoin blockchain (in a process known as solving a block ) in exchange for digital asset rewards (to
+date, only bitcoin). The industry practice is for miners to participate in mining pools organized by mining pool
+operators in which all pool participants share mining power (known as hashrate ) to earn digital asset rewards
+which are shared among pool members. The mining pool operator provides a service that coordinates the computing power of the independent
+mining enterprises participating in the mining pool. Fees are paid to the mining pool operator to cover the costs of maintaining the
+pool. We only use mining pools that pay rewards under the Full-Pay-Per-Share Method, which pays rewards to members based on the member s
+hashing power contributed to the pool each day times the difficulty index.
+
+ 
+
+Our Revenue Sources
+
+ 
+
+We generate revenues primarily from proprietary
+mining of bitcoin, consisting of our share of rewards from solving a block and transaction fees. Our digital asset self-mining activity
+competes with a myriad of mining operations throughout the world to complete new blocks in the blockchain and earn the reward in the form
+of an established unit of a digital asset. The primary factors that impact proprietary mining revenues include: (i) the price of bitcoin;
+(ii) the efficiency of our miners relative to that of our competitors; (iii) the availability of attractive electricity prices since power
+usage is the primary marginal cost for any mining operation; (iv) the availability of mining and immersion hosting equipment at attractive
+prices; and (v) whether we have available capacity for mining in our data center facilities or are required to use third party hosting
+firms for our miners.
+
+ 
+
+Our approach to synthetic bitcoin mining is
+also a source of revenue for us; we act as buyers when public miners pre-sell at discounted rates, and we pre-sell our own future hashrate
+to buyers. We entered into a Hashrate Purchase Agreement with a third party on April 22, 2025, wherein they presold the hashrate from
+their miners to us for approximately $104,670. The contract is for one month and we are expecting to receive between $110,000 to $115,000
+worth of bitcoin throughout the duration of the contract. We expect to continue this arrangement with the third party on a month-to-month
+basis; however, there can be no assurance that we will continue this arrangement.
+
+ 
+
+ 
+
+ 
+
+ 5 
+
+ 
+
+ 
+
+ 
+
+ 
+
+We also generate revenues from the advantageous
+purchase and sale of equipment used for digital asset mining and hosting. We have verbal arrangements with some suppliers that enable
+us to acquire highly desired equipment at wholesale prices which we sometimes resell to third parties. The primary factors that impact
+resales of mining equipment include the availability of equipment at attractive prices and the number of participants willing to enter
+the mining business or expand their existing operations, which is highly correlated to the margin from mining as determined by the market
+price of bitcoin and prevailing energy costs. Also, we believe our resales of mining equipment will be impacted by the existence of hosting
+capacity with attractive electricity rates in our hosting operations, as hosting clients have historically been a major source of customers
+for this line of business.
+
+ 
+
+We also earn revenue from our MaaS and bitcoin
+treasury consulting services. Through an agreement with KULR Technology Group, Inc. ( KULR ), we leased 3,000 bitcoin ASIC
+miners to KULR through December 30, 2025, for $3,200,000, with $1,600,000 paid upfront. KULR also engaged us for an $800,000 consulting
+agreement for one year, focused on bitcoin Mining-as-a-Service and bitcoin treasury strategy.
+
+ 
+
+We have occasionally earned hosting revenues by hosting third party
+miners when we had spare capacity in our hosting facilities described below. The primary factors that impact future hosting revenues include:
+(i) the price of bitcoin, since hosting revenues are primarily a percentage of bitcoin mined by clients; (ii) the completion of operational
+hosting facilities as potential hosting clients have been reluctant to sign contracts prior to the date we have a fully operational hosting
+facility; and (iii) the availability of attractive electricity prices since power usage is the primary marginal cost for any mining operation.
+At the present time, we do not have any hosting clients and are not marketing our services to hosting clients.
+
+ 
+
+Our Data Center Locations
+
+ 
+
+Trinidad Operations
+
+ 
+
+We have entered into an agreement with Telecommunications
+Services of Trinidad & Tobago Limited ( TSTT ), the largest and oldest telecom company in Trinidad, to co-locate up to
+125 800 kilowatt ( kW ) containers for hosting digital asset miners. TSTT has numerous potential locations for co-location
+of our containers. Under the agreement, we have the option, but not the obligation, to co-locate containers at our own pace. We pay a
+fixed amount per container, plus the actual electricity costs incurred by our containers in the amount billed to TSTT by the local utility
+without any markup. The agreement provides that our hosting containers will be billed for electricity usage at the local utility s
+standard rate which is the greater of 3.5 cents per kilowatt hour ( kWh ) or 75% of the declared reserve capacity, which is
+equal to the customer s highest expected monthly kilovolt-ampere demand at $7.40. The term of the agreement expires on October 14,
+2031. We have the right to terminate our agreement with TSTT at any time that the price for electricity consumption exceeds $0.05
+per kWh. Also, both parties have the right to terminate the agreement on one month s notice to the other party in either the third
+or sixth year of the term.
+
+ 
+We
+ have one site with two containers operational in Trinidad. As of the date of this prospectus,
+ we had 465 miners located at the site, of which 315 were in operation. We have two additional
+ unused containers in Trinidad and are evaluating other TSTT sites as a location for those
+ containers which we expect to have installed in the first calendar quarter of 2025. We are
+ also leasing space from a third party under an oral at-will agreement to co-host 60 miners
+ for which we pay a flat rate of $0.06 per kWh each month. We ultimately intend to move all
+ of our miners in Trinidad to our TSTT hosting facilities.
+
+ 
+
+We are currently focusing our efforts on the development
+of hosting centers in the United States and Canada, both directly and in joint ventures with third parties. We are exploring situations
+where medium to long-term power agreements may be available at affordable prices, whether using traditional power sources such as coal
+or natural gas, as well as environmentally friendly sources such as hydroelectric, wind and solar-backed projects, which might allow
+us to generate collateral revenue from the sale of excess power to the local utility grid and from the generation of saleable carbon
+credits.
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 6 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Pecos, Texas Operations
+
+ 
+
+In October 2022, we entered into a joint venture arrangement with
+ROC Digital Mining Manager LLC ( ROC Manager ) to jointly develop and operate a bitcoin mining operation in Pecos, Texas.
+Under the joint venture, we contributed one immersion container, six transformers and cash with an aggregate value of $987,429 as a capital
+contribution to ROC Digital Mining I, LLC (the ROC Digital ). An affiliate of ROC Manager also contributed an immersion container.
+We simultaneously sold ROC Digital four immersion containers for $1,200,000, which is payable pursuant to monthly amortizing payments
+with interest at 5% per annum through May 31, 2026. The note is secured by the equipment that was sold. As of August 31, 2024 the principal
+amount due on the note receivable from ROC Digital was $655,277. We own approximately 30% of ROC Digital, and 33 1/3% of ROC Manager.
+
+ 
+
+The site became fully electrified in June 2023 and has six containers
+owned by the joint venture. The joint venture initially filled its six immersion containers with ASIC miners provided by hosting clients,
+although most of the hosting clients agreements terminated in April 2024. Currently, approximately five of the hosting containers
+owned by the joint venture are fully or partially occupied by clients and the joint venture is aggressively trying to fill the remaining
+capacity with hosting clients. The joint venture also owns two immersion containers which are not installed which we expect the joint
+venture to install if hosting demand warrants.
+
+ 
+
+We have entered into a hosting agreement with ROC Digital under which
+we have located one immersion at its Pecos, Texas data center. We pay $500 per month plus our pro rata share of electricity, internet
+and insurance for the site. The hosting agreement has a term of one year effective as of May 1, 2023, subject to our right to renew the
+agreement for two one year terms after receipt of notice of the renewal terms of the joint venture s electricity supply agreement
+for the upcoming year. In April 2024, we renewed our hosting agreement for an additional year. As of the date of this prospectus, we had
+deployed 145 Antminer S-19 pro miners to our hosting container at the site.
+
+ 
+
+Soluna Locations
+
+ 
+
+On October 9, 2023, we entered into a hosting
+agreement with Soluna SW, LLC to host 1,095 ASIC miners at its data center in Murray, Kentucky. The hosting agreement had a term through
+April 8, 2025. The hosting agreement provides that we are obligated to reimburse Soluna for the actual cost of the electricity used
+by our machines and pay a hosting fee equal to 50% of the net profit generated by the machines each month. The hosting fee is payable
+in bitcoin under certain circumstances. As of the date of this prospectus, we had 1,095 miners at the site.
+
+ 
+On
+ April 8, 2025, Soluna SW, LLC, elected not to renew its hosting agreement with us on the
+ existing terms, and on April 30, 2025, we terminated our engagement with Soluna SW, LLC.
+ We sold 850 of the ASIC miners hosted by Soluna, SW LLC to a third party for $120,000 and
+ plan to move the remaining 245 to the Silverton, Texas location.
+
+ 
+On
+ December 3, 2024, we entered into a hosting agreement with DVSL ComputeCo, LLC to host 2,900
+ ASIC miners at its location. The hosting agreement terminates on December 2, 2025, provided
+ that the hosting agreement will continue after the termination date on a month-to-month basis
+ if neither party sends a notice of termination at least 30 days before its scheduled termination
+ date. The hosting agreement provides that we are obligated to reimburse DVSL for the actual
+ cost of the electricity used by our machines plus 1.6 cents per kWh, and pay a hosting fee
+ equal to 50% of the net profit generated by the machines each month. As of the date of this
+ prospectus, we had 3,145 miners at the site.
+
+ 
+
+Risk Factors Summary
+
+ 
+
+Our business is subject to a number of risks and
+uncertainties that you should understand before making an investment decision. These risks are discussed more fully in the section entitled
+ Risk Factors, following this prospectus summary. These include:
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 7 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Risks Related to Our Business
+
+ 
+
+ 
+ 
+ We have a history of losses and expect significant increases in our costs, expenses, and losses, and we expect to incur losses for at least the foreseeable future.
+
+ 
+ 
+ 
+
+ 
+ 
+ The profitability of our proprietary mining operations is dependent on the price of bitcoin, over which we have no control.
+
+ 
+ 
+ 
+
+ 
+ 
+ Our assets are highly concentrated in a single asset which enhances the risk inherent in our strategy.
+
+ 
+ 
+ 
+
+ 
+ 
+ If we fail to grow our hashrate, we may be unable to compete and our results of operations could suffer.
+
+ 
+ 
+ 
+
+ 
+ 
+ We may not be able to obtain new hosting and transaction processing hardware or purchase such hardware at competitive prices during times of high demand.
+
+ 
+ 
+ 
+
+ 
+ 
+ Our business is capital intensive and we may not be able to obtain the necessary capital to expand our operations.
+
+ 
+ 
+ 
+
+ 
+ 
+ Significant disruptions in the crypto asset markets, such as those experienced in the second half of 2022, may cause material impairment of the value and use of our miners.
+
+ 
+ 
+ 
+
+ 
+ 
+ Adverse developments in the blockchain industry and in the blockchain hosting market could have a material adverse effect on our business, financial condition and results of operations.
+
+ 
+ 
+
+ 
+ We may experience difficulties in establishing relationships with banks, leasing companies, insurance companies and other financial institutions that are willing to provide us with customary financial products and services.
+
+ 
+ 
+ 
+
+ 
+ 
+ If a malicious actor or botnet obtains control in excess of 50% of the processing power active on any digital asset network, including the bitcoin network, it is possible that such actor or botnet could manipulate the blockchain in a manner that adversely affects our business.
+
+ 
+ 
+ 
+
+ 
+ 
+ The elimination of ordinals could have a material adverse effect on our results of operations and financial condition.
+
+ 
+ 
+ 
+
+ 
+ 
+ Our reliance on immersion-cooling exposes us to additional risks.
+
+ 
+ 
+ 
+
+ 
+ 
+ Any loss or destruction of a private key required to access a digital asset of ours is irreversible. 
+
+ 
+ 
+ 
+
+ 
+ 
+ Digital asset transactions are irrevocable and stolen or incorrectly transferred digital assets may be irretrievable. 
+
+ 
+ 
+ 
+
+ 
+ 
+ The profitability of our proprietary mining operations is dependent on the price of electricity needed to run miners.
+
+ 
+ 
+ 
+
+ 
+ 
+ The profitability of our proprietary mining operations is dependent on the difficulty index of mining bitcoin.
+
+ 
+ 
+ 
+
+ 
+ 
+ Until our operations become self-sustaining, we will be required to raise additional funds, which may not be available or available on favorable terms or at all, to remain in business. 
+
+ 
+ 
+ 
+
+ 
+ 
+ Due to the unregulated nature and lack of transparency surrounding the operations of many bitcoin trading venues, they may experience fraud, security failures or operational problems, which may adversely affect the value of our bitcoin;
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 8 
+
+ 
+
+ 
+
+ 
+
+Risks Related to Governmental Regulation and Enforcement
+
+ 
+
+ 
+ 
+ Regulatory changes may subject us to registration or compliance obligations that could impose substantial costs on us or prevent us from conducting our business as it is currently conducted.
+
+ 
+ 
+ 
+
+ 
+ 
+ It may become illegal to mine, acquire, own, hold, sell or use bitcoin or other cryptocurrencies in places where we do business.
+
+ 
+ 
+ 
+
+ 
+ 
+ Future developments regarding the treatment of digital assets for U.S. federal income and applicable state, local and non-U.S. tax purposes could adversely impact our business.
+
+ 
+
+Risks Related to Ownership of Our Common Stock
+
+ 
+
+ 
+ 
+ An active trading market for our common stock may never develop or be sustained.
+
+ 
+ 
+ 
+
+ 
+ 
+ The price of our stock may be volatile and you could lose all or part of your investment.
+
+ 
+ 
+ 
+
+ 
+ 
+ We have the right to designate and issue additional shares of preferred stock. 
+
+ 
+
+ 
+ 
+ We depend on key personnel and competition for qualified employees is fierce. 
+
+ 
+ 
+ 
+
+ 
+ 
+ Anti-takeover provisions our governing documents and Delaware law could impair a takeover attempt.
+
+ 
+ 
+ 
+
+ 
+ 
+ We will indemnify and hold harmless our officers and directors to the maximum extent permitted by Delaware law.
+
+ 
+
+Risks Related to This Offering
+
+ 
+
+ 
+ 
+ We have broad discretion in the use of our cash, including the net proceeds from this offering.
+
+ 
+ 
+ 
+
+ 
+ 
+ You will suffer immediate dilution of your investment.
+
+ 
+ 
+ 
+
+ 
+ 
+ If we are not able to comply with the applicable continued listing requirements or standards of
+ the NYSE American, the NYSE American could delist our securities.
+
+ 
+ 
+ 
+
+ 
+ 
+ The sale or availability for sale of substantial amounts of our common stock could adversely affect its market price.
+
+ 
+
+Risks Related to the Reverse Stock Split
+
+ 
+
+ 
+ 
+ The reverse stock split may decrease the liquidity of the shares of our common stock.
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 9 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Implications of Being an Emerging Growth Company and a Smaller Reporting
+Company
+
+ 
+
+We qualify as an emerging growth company, 
+as defined in the JOBS Act. For as long as we remain an emerging growth company, we may take advantage of certain exemptions from various
+reporting requirements that are applicable to other public companies. These provisions include, but are not limited to:
+
+ 
+
+ 
+ 
+ being permitted to have only two years of audited financial statements and only two years of related selected financial data and management s discussion and analysis of financial condition and results of operations disclosure;
+
+ 
+ 
+ 
+
+ 
+ 
+ an exemption from compliance with the auditor attestation requirement in the assessment of our internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, as amended, or the Sarbanes-Oxley Act;
+
+ 
+ 
+ 
+
+ 
+ 
+ reduced disclosure about executive compensation arrangements in our periodic reports, registration statements and proxy statements; and
+
+ 
+ 
+ 
+
+ 
+ 
+ exemptions from the requirements to seek non-binding advisory votes on executive compensation or golden parachute arrangements.
+
+ 
+ 
+
+In addition, the JOBS Act permits emerging growth
+companies to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies.
+We are not choosing to opt out of this provision. We will remain an emerging growth company until the earliest of (i) the
+last day of the fiscal year following the fifth anniversary of the completion of our IPO, (ii) the last day of the first
+fiscal year in which our annual gross revenues exceed $1.07 billion, (iii) the date on which we have, during the immediately
+preceding three-year period, issued more than $1.0 billion in non-convertible debt securities and (iv) the end of
+any fiscal year in which the market value of our common stock held by non-affiliates exceeds $700 million as of the end of the
+second quarter of that fiscal year. We have elected to take advantage of certain of the reduced disclosure obligations in the registration
+statement of which this prospectus forms a part and may elect to take advantage of other reduced reporting requirements in future filings.
+As a result, the information that we provide to our stockholders may be different than you might receive from other public reporting companies
+in which you hold equity interests.
+
+ 
+
+We are also a smaller reporting company 
+as defined in the Securities Exchange Act of 1934, as amended, or the Exchange Act. We may continue to be a smaller
+reporting company even after we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available
+to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as the market value of our voting
+and non-voting common stock held by non-affiliates is less than $250 million measured on the last business day of
+our second fiscal quarter, or our annual revenue is less than $100 million during the most recently completed fiscal year and the
+market value of our voting and non-voting common stock held by non-affiliates is more than $700 million measured on the
+last business day of our second fiscal quarter.
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 10 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Corporate Information
+
+ 
+
+A predecessor to us was incorporated in the state
+of Nevada on August 16, 1995 as Interactive Lighting Showrooms, Inc., and redomiciled in the State of Delaware on April 6, 2020.
+
+ 
+
+On July 16, 2021, Jonathan Bates, Raymond Mow,
+Michael Maloney, and Seth Bayles were appointed to our board of directors, and Jonathan Bates, Raymond Mow, Seth Bayles, and Ryan Ramnath
+were appointed as officers. At the same time, such persons or their affiliates acquired approximately 62% of our issued and outstanding
+shares at the time in a private placement. Erik S. Nelson was previously the only member of the board and remained a director and chief
+executive officer. On May 26, 2022, our board of directors appointed Jonathan Bates as our chief executive officer and Erik Nelson as
+our president. The appointment of certain of the new officers and directors was done in connection with our entry into the business of
+creating hosting centers for bitcoin mining computers primarily utilizing immersion cooling technology, as well mining the bitcoin
+digital currency for our own account. Prior to such change of control, we were a shell company.
+
+ 
+
+Our principal executive offices are located
+at 10845 Griffith Peak Dr., #2, Las Vegas, Nevada 89135, and our telephone number is (404) 816-8240. Our corporate website address
+is bitminetech.io. The information contained on or accessible through our website is not a part of this prospectus, and the
+inclusion of our website address in this prospectus is an inactive textual reference only.
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 11 
+
+ 
+
+ 
+
+ 
+
+ 
+
+THE OFFERING
+
+ 
+
+ 
+ Shares of Common Stock Offered by Us
+ 
+ 1,875,000 shares (or 2,156,250 shares if the underwriters exercise the option to purchase additional shares in full).
+
+ 
+ 
+ 
+ 
+
+ 
+ Shares of Common Stock Outstanding before the Offering (1)
+ 
+ 2,053,380 shares.
+
+ 
+ 
+ 
+ 
+
+ 
+ Shares of Common Stock Outstanding after the Offering (2)
+ 
+ 5,785,170 shares (or 6,066,420 shares if the underwriters exercise the option to purchase additional
+ shares in full).
+
+ 
+ 
+ 
+ 
+
+ 
+ Overallotment Option 
+ 
+ We have granted a 45-day option to the underwriters
+ to purchase from us, at the public offering price, less the underwriting discounts and commissions, up to 281,250 additional shares
+ of common stock solely to cover overallotments, if any.
+
+ 
+ 
+ 
+ 
+
+ 
+ Use of proceeds
+ 
+ We estimate that
+ the net proceeds from this offering will be approximately $13,225,000 (or $15,284,250 if the underwriters exercise their option to
+ purchase additional shares in full), based upon an assumed public offering price of $8.00 per share, after deducting the
+ underwriting discounts and commissions and estimated offering expenses payable by us. We currently intend to use all of the net
+ proceeds from this offering in the short-term to purchase bitcoin. In the longer term, we expect to either sell bitcoin or leverage
+ our bitcoin holdings for working capital and other general corporate purposes, including to expand our capacity to mine bitcoin by
+ buying new miners and buying and installing new hosting equipment. (See Use of
+ Proceeds. )
+
+ 
+ 
+ 
+ 
+
+ 
+ Proposed Listing
+ 
+ Our shares of common stock are currently quoted
+ on the OTCQX operated by the OTC Markets Group, Inc. under the symbol BMNRD. We have applied to have our common stock
+ listed on the NYSE American under the proposed symbol BMNR. The listing of our common stock on NYSE American or another
+ securities exchange is a condition of this offering. No assurance can be given that such listing will be approved or that a trading
+ market will develop for our common stock.
+
+ 
+ 
+ 
+ 
+
+ 
+ Lock-Up Agreements
+ 
+ Our executive officers and directors and any holder
+ of 5% or more of the outstanding shares of our common stock have agreed with the underwriters not to sell, transfer, or dispose of
+ any shares of common stock or similar securities for 180 days (or 90 days with respect to certain of the 5% or more stockholders)
+ following the effective date of the registration statement for this offering. (See Underwriting. )
+
+ 
+ 
+ 
+ 
+
+ 
+ Reverse Stock Split
+ 
+ 
+
+On May 15, 2025, we filed a Certificate of Amendment to our Amended
+and Restated Certificate of Incorporation to effect a reverse stock split of our issued and outstanding shares of common stock at a ratio
+of 1-for-20 (the Reverse Stock Split ).
+
+ 
+
+Following the Reverse Stock Split, every 20 shares of our issued and
+outstanding shares of common stock were automatically converted into one issued and outstanding share of common stock, without any change
+in par value per share. No fractional shares were issued in connection with the Reverse Stock Split, and any shareholders who would have
+received fractional shares of common stock, instead received cash equal to the market value of the fractional share at the closing price
+of our common stock on May 15, 2025. The Reverse Stock Split did not affect the number of shares of authorized stock. Our common stock
+began trading on a Reverse Stock Split-adjusted basis on May 16, 2025 and was assigned a new temporary ticker symbol BMNRD 
+for the 20 business days following the reverse stock split and on the 21st day, it will change back to BMNR. 
+
+ 
+
+The purpose of the Reverse Stock Split was to allow us to meet the
+stock price threshold of the listing requirements of the NYSE American.
+
+ 
+
+Except for our historical financial statements, all share and per share
+information in this prospectus gives effect to the Reverse Stock Split.
+
+ 
+ 
+ 
+ 
+
+ 
+ Risk Factors
+ 
+ An investment in our common stock involves a high degree of risk. You should read this prospectus carefully, including the section titled Risk Factors and the combined and consolidated financial statements and the related notes to those statements included in this prospectus, before investing in our common stock.
+
+ 
+ 
+ 
+ 
+
+ 
+ Transfer Agent
+ 
+ The transfer agent and registrar for our Common Stock is West Coast Stock Transfer, Inc.
+
+ 
+ 
+
+ 
+
+ 12 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ (1) 
+ The number of shares of common stock outstanding immediately before this offering is based on 2,053,380
+ shares of common stock actually outstanding as of the date of this prospectus, and additionally gives effect to the Reverse Stock
+ Split.
+
+ 
+ 
+ 
+
+ 
+ (2) 
+ The number of shares of common stock outstanding immediately after this
+offering is based on 2,053,380 shares of common stock actually outstanding as of the date of this prospectus, and additionally
+gives effect to:
+ 
+ 
+ 
+
+ 
+
+ 
+ 
+ 
+ the Reverse Stock Split;
+
+ 
+ 
+ 
+ the issuance of 1,134,915 shares
+ of common stock upon the conversion of outstanding Series A Convertible Preferred Stock in connection with the closing of this offering;
+
+ 
+ 
+ 
+ the issuance of 625,000 shares of common
+ stock (on a post-split basis) upon the conversion of outstanding Series B Convertible Preferred Stock in connection with the closing
+ of this offering; and
+
+ 
+ 
+ 
+ the issuance of 96,875 shares of common stock
+ upon the conversion of approximately $775,000 of indebtedness due to an affiliate into common stock at the public offering price;
+
+ 
+ 
+
+ 
+ 
+ 
+ but excludes 1,280 shares of common stock issuable upon the exercise of outstanding Class C-3 Warrants with an exercise price of $25.00 (on a post-split basis), and 3,750,000 shares of common stock reserved for issuance pursuant to the 2025 Equity Incentive Plan (the 2025 Equity Incentive Plan ).
+
+ 
+
+ 
+
+Except as otherwise indicated, all information in this prospectus assumes:
+
+ 
+
+ 
+ 
+ 
+ a public offering price of $8.00
+ per share, which is based on the last reported sale price of our common stock on the OTCQX on May 16, 2025;
+
+ 
+ 
+ 
+ that all shares of Series A Convertible Preferred Stock
+ and Series B Convertible Preferred Stock are converted into common stock immediately prior to the offering at their existing conversion
+ prices of $4.00 per share (post-split) (see Certain Relationships and Related Party Transactions Letter Agreement
+ with Jonathan Bates and IDI );
+
+ 
+ 
+ 
+ that
+ no shares of common stock have been issued pursuant to any exercise of outstanding warrants;
+
+ 
+ 
+ 
+ that
+ no shares of common stock or warrants have been issued pursuant to the Underwriters overallotment option; and
+
+ 
+ 
+ 
+ that
+ no shares of common stock have been issued pursuant to the Representative s Warrants.
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 13 
+
+ 
+
+ 
+
+ 
+
+ 
+
+SUMMARY FINANCIAL INFORMATION
+
+ 
+The
+ statement of operations data for the years ended August 31, 2024, and 2023 and the consolidated
+ balance sheet data as of August 31, 2024, are derived from our audited consolidated financial
+ statements included elsewhere in this prospectus. The statement of operations data for
+ the six months ended February 28, 2025 and February 29, 2024 and the consolidated balance
+ sheet data as of February 28, 2025 are derived from our unaudited consolidated financial
+ statements included elsewhere in this prospectus.
+
+ 
+
+The information below is only a summary and should
+be read in conjunction with the sections entitled Management s Discussion and Analysis of Financial Condition and Results of Operations and our consolidated financial statements, and the notes and schedules related thereto, which are included elsewhere
+in this prospectus.
+
+ 
+
+Consolidated Statement of Operations Data
+
+ 
+
+ 
+ 
+ Fiscal Year Ended August 31, 
+ Six Months Ended, 
+
+ 
+ 
+ 2024 
+ 2023 
+ February 28, 2025 
+ February 29, 2024 
+
+ 
+ Net Revenues 
+ $3,310,348 
+ $645,278 
+ $2,718,252 
+ $1,402,921 
+
+ 
+ Operating Loss 
+ $(2,447,485) 
+ $(2,413,083) 
+ $(1,797,641) 
+ $(1,258,591)
+
+ 
+ Net Loss 
+ $(3,292,503) 
+ $(2,464,884) 
+ $(2,131,629) 
+ $(1,830,522)
+
+ 
+ Deemed dividend on Series A Preferred Stock 
+ $ 
+ $ 
+ $(2,960,648) 
+ $ 
+
+ 
+ Net Loss Attributable to Common Stock 
+ $(3,292,503) 
+ $(2,464,884) 
+ $(5,092,277) 
+ $(1,830,522)
+
+ 
+
+ 
+
+Consolidated Balance Sheet Data
+
+ 
+
+ 
+ 
+ As of February 28, 2025 
+
+ 
+ 
+ Actual 
+ As
+ Adjusted (1) 
+
+ 
+ Cash and cash equivalents 
+ $482,951 
+ $13,857,951 
+
+ 
+ Total current assets 
+ $1,148,553 
+ $14,273,924 
+
+ 
+ Total assets 
+ $7,500,676 
+ $20,275,676 
+
+ 
+ Total liabilities 
+ $4,647,527 
+ $3,273,527 
+
+ 
+ Total stockholders equity 
+ $2,853,149 
+ $17,003,149 
+
+ 
+
+ 
+
+(1) On
+an as adjusted basis to give effect to (i) the sale by us of 1,875,000 shares of common stock based upon an assumed public offering price
+of $8.00 per share in this offering and assuming no exercise of the overallotment option, after deducting the estimated underwriting
+discounts and commissions and estimated expenses payable by us in connection with this offering, (ii) the conversion of approximately
+$775,000 of debt due to an affiliate into shares of common stock at the public offering price, and (iii) the assignment of approximately
+$600,000 of notes receivable due to us in satisfaction of approximately $600,000 of debt due from us to an affiliate. (See Certain
+Relationships and Related Party Transactions Letter Agreement with Jonathan Bates and IDI. )
+
+ 
+
+ 
+
+ 
+
+ 14 
+
+ 
+
+ 
+
+ 
+
+RISK FACTORS
+
+ 
+
+Investing in our common stock involves a high
+degree of risk. You should carefully consider the following information about these risks, together with the other information appearing
+elsewhere in this prospectus, including our financial statements, the notes thereto and the section entitled Management s Discussion and Analysis of Financial Condition and Results of Operations, before deciding to invest in our common stock. The occurrence
+of any of the following risks could have a material adverse effect on our business, reputation, financial condition, results of operations
+and future growth prospects, as well as our ability to accomplish our strategic objectives. As a result, the trading price of our
+common stock could decline and you could lose all or part of your investment. Additional risks and uncertainties not presently known to
+us or that we currently deem immaterial may also impair our business operations and the market price of our common stock.
+
+ 
+
+Risks Related to Our Business
+
+ 
+
+We have incurred significant net losses since our inception and
+may not be able to achieve or maintain profitability on an annual basis in the future.
+
+ 
+We
+ have incurred significant net losses since our inception. For the years ended August 31,
+ 2024 and 2023, we incurred net losses of approximately $3.3 million and $2.5 million, respectively.
+ For the six months ended February 28, 2025 and February 29, 2024, we incurred net losses
+ of $2,131,629 and $1,830,522, respectively. We had accumulated losses of approximately $12.2
+ million through August 31, 2024. We cannot predict if we will achieve or maintain annual
+ profitability in the near future or at all. Our expected growth may not be sustainable or
+ may decrease, and we may not generate sufficient revenue to achieve or maintain annual profitability.
+ Our ability to achieve and maintain annual profitability depends on a number of factors,
+ including our ability to raise capital to increase our mining capacity, our ability to negotiate
+ attractive power agreements, the future price of bitcoin and the future difficulty index
+ of bitcoin. If we are unable to achieve or maintain annual profitability, we may not be able
+ to execute our business plan, our prospects may be harmed, and our stock price could be materially
+ and adversely affected.
+
+ 
+
+Bitcoin prices are highly volatile, which may affect our ability
+to effectively manage growth plans and our profitability.
+
+ 
+
+The price of bitcoin is extremely volatile. In
+2023, the price range of bitcoin was approximately $16,600 to $42,800, and in 2024, the price range of bitcoin was approximately $40,000
+to $108,000. From January 1, 2025 through the date of this prospectus, the price range of bitcoin has been $78,532 to $104,735.
+The cost to mine a bitcoin is independent of the then current price of bitcoin, so when prices are low, the cost per coin to mine may
+consume much of our available cash, which means that there is less capital with which to invest in future company growth. Similarly,
+when prices are low, our profitability is decreased on a dollar-for-dollar basis correlated to the then price of bitcoin. Given the volatility
+of bitcoin, these factors render us unable to accurately predict in advance what our growth plans may be and accurately forecast any
+revenue and profitability projections for any reporting period.
+
+ 
+
+The price of bitcoin may be influenced by regulatory, commercial,
+and technical factors that are highly uncertain.
+
+ 
+
+Bitcoin and other digital assets are relatively
+novel and are subject to various risks and uncertainties that may adversely impact their price. For example, the application of securities
+laws and other regulations to such assets is unclear in certain respects, and it is possible that regulators in the United States or foreign
+countries may create new regulations or interpret laws in a manner that adversely affects the price of bitcoin. The growth of the digital
+assets industry in general, and the use and acceptance of bitcoin in particular, may also impact the price of bitcoin and is subject to
+a high degree of uncertainty. The pace of worldwide growth in the adoption and use of bitcoin could depend on the following:
+
+ 
+
+ 
+ 
+ public familiarity with digital assets;
+
+ 
+ 
+ 
+
+ 
+ 
+ ease of buying and accessing bitcoin;
+
+ 
+
+ 
+
+ 
+
+ 15 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ institutional demand for bitcoin as an investment asset;
+
+ 
+ 
+ 
+
+ 
+ 
+ consumer demand for bitcoin as a means of payment; and
+
+ 
+ 
+ 
+
+ 
+ 
+ the availability and popularity of alternatives to bitcoin.
+
+ 
+ 
+
+Even if growth in bitcoin adoption occurs in the
+near or medium-term, there is no assurance that bitcoin usage will continue to grow over the long-term. Because bitcoin has no physical
+existence beyond the record of transactions on the bitcoin blockchain, a variety of technical factors related to the bitcoin blockchain
+could also impact the price of bitcoin. For example, malicious attacks by miners who validate bitcoin transactions, inadequate
+mining fees to incentivize validating of bitcoin transactions, hard forks of the bitcoin blockchain, and advances in quantum
+computing could undercut the integrity of the bitcoin blockchain and negatively affect the price of bitcoin. The liquidity of bitcoin
+may also be reduced and damage to the public perception of bitcoin may occur, if financial institutions were to deny banking services
+to businesses that hold bitcoin, provide bitcoin-related services or accept bitcoin as payment, which could also decrease the price of
+bitcoin. Such circumstances could have a material adverse effect on our business, prospects, or operations.
+
+ 
+
+Fluctuations in the price of bitcoin may significantly influence
+the market price of our bitcoin holdings and therefore, the price of our common stock.
+
+ 
+
+To the extent investors view the value of our common
+stock as linked to the value or change in the value of our bitcoin, fluctuations in the price of bitcoin may significantly influence the
+market price of our common stock.
+
+ 
+
+Our assets are highly concentrated in a single asset, which enhances
+the risk inherent in our strategy.
+
+ 
+
+Concentration risk arises as a result of the concentration
+of exposures within the same category, whether it is geographical location, product type, industry sector, or counterparty type. Currently,
+we have our investment highly concentrated in a single asset, bitcoin. The concentration of our bitcoin holdings limits the risk mitigation
+that we could take advantage of by holding a more diversified portfolio of treasury assets. The price of bitcoin has recently experienced
+significant volatility, and this volatility has had, and any further significant volatility in the price of bitcoin would have, a more
+pronounced impact on our financial condition than if we held a more diverse portfolio of assets.
+
+ 
+
+If we fail to grow our hashrate, we may be unable to compete,
+and our results of operations could suffer.
+
+ 
+
+Generally, a bitcoin miner s chance of solving
+a block on the bitcoin blockchain and earning a bitcoin reward is a function of the miner s hashrate (i.e., the amount of computing
+power devoted to supporting the bitcoin blockchain), relative to the global network hashrate. As greater adoption of bitcoin occurs, we
+expect the demand for bitcoin will increase further, drawing more mining companies into the industry and thereby increasing the global
+network hashrate. As new and more powerful miners are deployed, the global network hashrate will continue to increase, meaning a miner s
+chance of earning bitcoin rewards will decline unless it deploys additional hashrate at pace with the industry. Compounding this feedback
+loop, the network difficulty of the bitcoin network (i.e., the amount of work (measured in hashes) necessary to solve a block) is periodically
+adjusted to maintain the pace of new block additions (with one new block added to the blockchain approximately every ten minutes), and
+thereby control the supply of bitcoin. As miners deploy more hashrate and the bitcoin network hashrate is increased, the bitcoin network
+difficulty is adjusted upwards by requiring more hashrate to be deployed to solve a block. Thus, miners are further incentivized to grow
+their hashrate to maintain their chance of earning new bitcoin rewards.
+
+ 
+
+Accordingly, to maintain our chances of earning new
+bitcoin rewards and remaining competitive in our industry, we must seek to continually add new miners to grow our hashrate at pace with
+the growth in the bitcoin global network hashrate. However, as demand miners has increased sharply, and we expect this process to continue
+in the future as demand for bitcoin increases. Therefore, if the price of bitcoin is not sufficiently high to allow us to fund our hashrate
+growth through new miner acquisitions and if we are otherwise unable to access additional capital to acquire these miners, our hashrate
+may stagnate and we may fall behind our competitors. If this happens, our chances of earning new bitcoin rewards would decline and, as
+such, our results of operations and financial condition may suffer.
+
+ 
+
+ 
+
+ 
+
+ 16 
+
+ 
+
+ 
+
+ 
+
+We may not be able to obtain new hosting and transaction processing
+hardware or purchase such hardware at competitive prices during times of high demand.
+
+ 
+
+Historically, an increase in interest and demand
+for digital assets has led to a shortage of hosting and transaction processing hardware and increased prices. As the price of digital
+assets increase, the profits that are generated from the mining those assets also increase, which causes more companies to enter the mining
+industry and existing companies to expand their mining operations. When that occurs, the demand for equipment may outpace supply and create
+mining machine equipment shortages. Currently, with the substantial increase in the price of bitcoin from its recent lows in late 2022,
+there is increased demand for new and used mining and hosting equipment. While we have not seen an uptick in the price of used mining
+equipment so far due to an overhang of supply on the market, we expect that prices will trend up in the near future if the bitcoin price
+of bitcoin remains constant or increases from its current level. In the short-term, a substantial increase in the price of bitcoin and
+associated equipment prices would improve the profitability of our existing operations, but in the long-term it could impair our ability
+to expand our operations or replace obsolete equipment, which could have a material adverse effect on our business, financial condition
+and results of operations.
+
+ 
+
+Our business is capital intensive, and failure to obtain the
+necessary capital when needed may force us to delay, limit or terminate our expansion efforts or other operations.
+
+ 
+
+Part of our business plan is to construct, develop
+and operate digital asset mining facilities, and to mine digital assets for our own account in those facilities by means of a fleet of
+the latest generation mining equipment. We may also use our mining facilities to host third-party miners. However, the costs of constructing,
+developing, operating and maintaining digital asset mining and hosting facilities, and owning and operating a large fleet of the latest
+generation mining equipment, are substantial. We have completed our initial hosting facility in Trinidad which recently became operational.
+We are also a partner in a joint venture that recently completed a facility with a capacity of 5-6 MW in Texas, which became operational
+in June 2023. We currently lack the capital to open material additional facilities or materially expand our additional facilities. Without
+capital to construct new mining facilities, we have focused our efforts on acquiring miners which are hosting in mining facilities owned
+by third parties.
+
+ 
+
+We will need to raise additional funds through
+equity or debt financings in order to meet our capital needs. Additional debt or equity financing may not be available when needed or,
+if available, may not be available on satisfactory terms. If our stock price declines and/or our trading volume remains low, our ability
+to raise capital to expand our business will be impaired. We have retained investment bankers to assist in raising the necessary capital
+to expand our business, but they can provide no assurance that capital is available on attractive terms in the current market environment.
+An inability to obtain additional debt or equity financing would adversely affect our business, financial condition and results of operations.
+
+ 
+
+To the extent we host third party miners, our success will depend
+in large part on our ability to provide a competitive hosting environment, which is necessary to attract and retain customers for our
+hosting services.
+
+ 
+
+While our primary plan is to utilize our hosting
+facilities to mine bitcoin for our own account, we may utilize our hosting facilities to host third-party miners where we can do so on
+attractive terms. Our hosting success will depend our ability to attract hosting customers, which will depend our ability to offer competitive
+hosting terms and capabilities that enable our hosting clients to operate profitably. We may not be able to attract customers to our hosting
+capabilities for a number of reasons, including if:
+
+ 
+
+ 
+ 
+ 
+ we are unable to find suitable locations for hosting facilities which have electricity at competitive rates; 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ there is a reduction in the demand for our services due to macroeconomic factors in the markets in which we operate;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ we fail to provide competitive pricing terms or effectively market them to potential customers;
+
+ 
+
+ 
+
+ 
+
+ 17 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ we provide hosting services that are deemed by existing and potential customers or suppliers to be inferior to those of our competitors, or that fail to meet customers or suppliers ongoing and evolving program qualification standards, based on a range of factors, including available power, preferred design features, security considerations and connectivity;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ mining businesses decide to host internally as an alternative to the use of our services;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ we fail to successfully communicate the benefits of our services to potential customers;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ we are unable to strengthen awareness of our brand;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ we are unable to provide services that our existing and potential customers desire;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our customers are unable to secure an adequate supply of new generation digital asset mining equipment to host with us; or
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ we are unable to obtain deliveries of hosting equipment, including immersion containers and transformers, which have recently been in short supply.
+
+ 
+ 
+
+Furthermore, all of the risks that exist for our
+mining business would also exist for our third-party hosting clients. The inability of our hosting clients to operate profitably could
+adversely impact on our hosting business, which could have a material adverse effect on our business, financial condition and results
+of operations.
+
+ 
+
+Significant disruptions in the crypto asset markets, such as
+those experienced in the second half of 2022, may cause material impairment of the value and use of our miners.
+
+ 
+
+During the fourth quarter of 2022, the per coin
+price of bitcoin reached a low of approximately $15,500 from a high of almost $21,500 earlier in the quarter. This decrease in the price
+of bitcoin, combined with general market sentiment caused in large part by the collapse of FTX Trading Ltd. ( FTX ) in November
+2022 and various bitcoin company-related bankruptcies and restructurings, led to a material decline in the fair value of our miners during
+that period. Any future decrease in the value of bitcoin could cause us to record additional impairments in the value of our current and
+future assets.
+
+ 
+
+In addition, if bitcoin prices dropped to levels
+below that experienced in 2022 and held at those levels for a significant period of time, it could impact our profitability such that
+we would possibly need to consider whether it would be prudent to leave certain of our miners idle until the price of bitcoin recovered.
+
+ 
+
+Theoretically, there is a minimum bitcoin price
+that is so low that we would be incentivized to cease our mining operations, particularly where our operating costs exceed our revenues.
+However, this is a complex projection involving multiple ever-changing, dynamic variables. We have multiple mining sites and hosting partners,
+all with different hosting prices, electricity prices, and contract structures. These costs would need to be compared to the current revenue
+being produced by our miners.
+
+ 
+
+ 
+
+ 
+
+ 18 
+
+ 
+
+ 
+
+ 
+
+Adverse developments in the blockchain industry and in the blockchain
+hosting market could have a material adverse effect on our business, financial condition and results of operations. 
+
+ 
+
+The blockchain industry faces a number of material
+risks, including those related to:
+
+ 
+
+ 
+ 
+ 
+ a decline in the adoption and use of bitcoin and other similar digital assets within the technology industry or a decline in value of digital assets;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ increased costs of complying with existing or new government regulations applicable to digital assets and other factors;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ a downturn in the market for blockchain hosting space generally, which could be caused by an oversupply of or reduced demand for blockchain space;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the rapid development of new technologies or the adoption of new industry standards that render the mining of digital assets unprofitable or obsolete, such as widespread adoption of proof of stake method of validating blockchain transactions instead of proof of work; 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ a slowdown in the growth of the Internet generally as a medium for commerce and communication;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ availability of an adequate supply of new generation digital asset mining equipment to enable us to mine digital assets at scale;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the degree of difficulty in mining digital assets and the trading price of such assets;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an increase in political opposition to mining digital assets, for example due to concerns about its impact on climate change or its impact on the availability of affordable electricity to other consumers in the local market, the degree of difficulty in mining digital assets and the trading price of such assets; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ a material increase in the cost of electricity needed to operate mining equipment.
+
+ 
+ 
+
+To the extent that any of these or other adverse
+conditions exist, they are likely to have an adverse impact on our mining rewards, which could have a material adverse effect on our business,
+financial condition and results of operations.
+
+ 
+
+Geopolitical or economic crises may create increased uncertainty
+and price changes, or motivate large-scale sales of digital assets, which could result in a reduction in some or all digital assets 
+values.
+
+ 
+
+As an alternative to fiat currencies that are backed
+by central governments, digital assets such as bitcoin, which are relatively new, are subject to supply and demand forces based upon the
+desirability of an alternative, decentralized means of buying and selling goods and services. It is unclear how such supply and demand
+will be impacted by geopolitical events. Nevertheless, geopolitical or economic crises may motivate large-scale acquisitions or sales
+of digital assets either globally or locally. Large-scale sales of digital assets would result in a reduction in their value, which could
+adversely affect our business, financial condition and results of operations.
+
+ 
+
+In addition, we are subject to price volatility
+and uncertainty due to geopolitical crises and economic downturns. Such geopolitical crises and global economic downturns may be a result
+of invasion, or possible invasion, by one nation of another, leading to increased inflation and supply chain volatility. Such crises,
+as well as inflation, could adversely affect our business, financial condition and results of operations.
+
+ 
+
+ 
+
+ 
+
+ 19 
+
+ 
+
+ 
+
+ 
+
+Adoption of a different method of validating transactions in
+bitcoin could materially impair the business of mining firms and could even make them obsolete. 
+
+ 
+
+Transactions in bitcoin are currently validated
+by a system called proof of work, where powerful computers run software that races to solve complex problems, verifying
+transactions in the process. The system is widely known as mining because the computers earn payments in cryptocurrency
+as rewards for the verification service. The system has been criticized by many because it requires substantial amounts of electricity
+to validate transactions. Recently, another type of digital currency, Ethereum, implemented a different system of validation called proof
+of stake, which is expected to require 99% less energy consumption. In the event bitcoin adopts a similar system, it could make
+bitcoin mining substantially less profitable and could even render the business obsolete, which would adversely affect our business, financial
+condition and results of operations.
+
+ 
+
+The sale of our digital assets to pay expenses at a time of low
+digital asset prices could adversely affect an investment in our securities.
+
+ 
+
+We may sell our digital assets to pay expenses
+on an as-needed basis, irrespective of then-current prices. Consequently, our digital assets may be sold at a time when the prices on
+the respective digital asset exchange market are low, which could adversely affect our business, financial condition and results of operations.
+
+ 
+
+Supply chain and shipping disruptions have resulted in shipping
+delays, a significant increase in shipping costs, and could increase product costs and result in lost sales.
+
+ 
+
+Supply chain disruptions, resulting from factors
+such as the COVID-19 pandemic, labor supply and shipping container shortages, have impacted us and our third-party manufacturers and suppliers
+in the past and may do so in the future. These disruptions have, at times, resulted in longer lead times and increased product costs and
+shipping expenses, including with respect to the delivery of miners that we have purchased. When supply chain disruptions have occurred,
+we have taken steps to minimize the impact of these increased costs by working closely with our suppliers and customers, but there can
+be no assurances that unforeseen events impacting the supply chain will not have a material adverse effect on us in the future. Additionally,
+the impacts supply chain disruptions have on our third-party manufacturers and suppliers are not within our control. When supply chain
+disruptions occur, it is often not possible to predict how long it will take for the supply chain disruptions to cease. Prolonged supply
+chain disruptions impacting us and our third-party manufacturers and suppliers could have a material adverse effect on our business, operating
+results and financial condition.
+
+ 
+
+We may experience difficulties in establishing relationships
+with banks, leasing companies, insurance companies and other financial institutions that are willing to provide us with customary financial
+products and services.
+
+ 
+
+As an early stage company with operations focused
+in the digital asset transaction processing industry, we may in the future experience difficulties in establishing relationships with
+banks, leasing companies, insurance companies and other financial institutions that are willing to provide us with customary leasing and
+financial products and services, such as bank accounts, lines of credit, insurance and other related services, which are necessary for
+our operations. In particular, a number of companies that engage in bitcoin and/or other cryptocurrency-related activities have been unable
+to find banks or financial institutions that are willing to provide them with bank accounts and other services. Similarly, a number of
+companies and individuals or businesses associated with cryptocurrencies may have had and may continue to have their existing bank accounts
+closed or services discontinued with financial institutions. To the extent that such events may happen to us, they could have a material
+adverse effect on our business, prospects or operations and potentially the value of any bitcoin or other cryptocurrencies we mine or
+otherwise acquire or hold for our own account.
+
+ 
+
+ 
+
+ 
+
+ 20 
+
+ 
+
+ 
+
+ 
+
+The development and acceptance of digital asset networks and
+other digital assets, which represent a new and rapidly changing industry, are subject to a variety of factors that are difficult to evaluate.
+
+ 
+
+Digital assets such as bitcoin, that may be used,
+among other things, to buy and sell goods and services are a new and rapidly evolving industry. The growth of the digital asset industry
+in general, and the digital asset networks of bitcoin in particular, are highly uncertain. The factors affecting the further development
+of the digital asset industry, as well as the digital asset networks, include:
+
+ 
+
+ 
+ 
+ continued worldwide growth in the adoption and use of bitcoins and other digital assets;
+
+ 
+ 
+ 
+
+ 
+ 
+ government and quasi-government regulation of bitcoins and other digital assets and their use, or restrictions on or regulation of access to and operation of the digital asset network or similar digital assets systems;
+
+ 
+ 
+ 
+
+ 
+ 
+ the maintenance and development of the open-source software protocol of the bitcoin network;
+
+ 
+ 
+ 
+
+ 
+ 
+ changes in consumer demographics and public tastes and preferences;
+
+ 
+ 
+ 
+
+ 
+ 
+ the availability and popularity of other forms or methods of buying and selling goods and services, including new means of using fiat currencies;
+
+ 
+ 
+ 
+
+ 
+ 
+ general economic conditions and the regulatory environment relating to digital assets;
+
+ 
+ 
+ 
+
+ 
+ 
+ the impact of regulators focusing on digital assets and digital securities and the costs associated with such regulatory oversight; and
+
+ 
+ 
+ 
+
+ 
+ 
+ a decline in the popularity or acceptance of the digital asset networks of bitcoin, or similar digital asset systems, could adversely affect an investment in our securities.
+
+ 
+ 
+
+The open-source structure of the bitcoin network protocol means
+the contributors to the protocol are generally not directly compensated for their contributions in maintaining and developing the protocol,
+which could result in a failure to properly monitor and upgrade the protocol which could damage the bitcoin network.
+
+ 
+
+Digital asset networks are open-source projects
+and, although there is an influential group of leaders in, for example, the bitcoin network community known as the Core Developers, 
+there is no official developer or group of developers that formally controls the bitcoin network. As an open-source project, bitcoin is
+not represented by an official organization or authority. The bitcoin network protocol is not sold and contributors are generally not
+compensated for maintaining and updating the bitcoin network protocol. The lack of guaranteed financial incentive for contributors to
+maintain or develop the bitcoin network and the lack of guaranteed resources to adequately address emerging issues with the bitcoin network
+may reduce incentives to address the issues adequately or in a timely manner. Changes to a digital asset network in which we are directing
+our mining efforts could adversely affect our business, financial condition and results of operations.
+
+ 
+
+ 
+
+ 
+
+ 21 
+
+ 
+
+ 
+
+ 
+
+The acceptance of digital asset network software patches or upgrades
+by a significant, but not overwhelming, percentage of the users and miners in any digital asset network could result in a fork 
+in the respective blockchain, resulting in the operation of two separate networks until such time as the forked blockchains are merged.
+
+ 
+
+Due to bitcoin s open-source project, any
+individual can download the bitcoin network software and make any desired modifications, which are proposed to users and miners on the
+bitcoin network through software downloads and upgrades, and typically posted to the bitcoin development forum on GitHub.com. A substantial
+majority of miners and bitcoin users must consent to those software modifications by downloading the altered software or upgrade that
+implements the changes. If not, the changes do not become a part of the bitcoin network.
+
+ 
+
+Since the bitcoin network s inception, changes
+to the bitcoin network have been accepted by the vast majority of users and miners, ensuring that the bitcoin network remains a coherent
+economic system. However, a developer or group of developers could potentially propose a modification to the bitcoin network that is not
+accepted by a vast majority of miners and users, but that is nonetheless accepted by a substantial population of participants in the bitcoin
+network. In such a case, and if the modification is material and/or not backwards compatible with the prior version of bitcoin network
+software, a fork in the blockchain could develop and two separate bitcoin networks could result with one running the pre-modification
+software program and the other running the modified version (i.e., a second bitcoin network).
+
+ 
+
+Such a fork in the blockchain is typically addressed
+by community-led efforts to merge the forked blockchains, and several prior forks have been so merged. This kind of split in the bitcoin
+network could materially and adversely impact an investment in our securities and harm the sustainability of the bitcoin network s
+economy.
+
+ 
+
+Over time, the bitcoin network will need to transition to a system
+where miners are rewarded for solving blocks primarily or solely by transaction fees for processing bitcoin transactions instead of by
+bitcoin awards, and there is no assurance that such transition will be accepted by the marketplace. 
+
+ 
+
+In order to incentivize miners to record transactions
+by solving a block, the bitcoin network rewards miners with an award of bitcoin and any transaction fees each time they solve a block.
+However, the bitcoin network is designed to reduce the bitcoin rewards by half for every 210,000 blocks solved, which happens approximately
+every four years, until the maximum number of bitcoin has been created, which is scheduled to occur in 2040. Therefore, as the bitcoin
+rewards for solving a block are reduced over time until they are eliminated, miners will need to increasingly rely upon transaction fees
+to record bitcoin transactions. This transition could be accomplished either by miners independently electing to record in the blocks
+they solve only those transactions that include payment of a transaction fee or by the digital asset network adopting software upgrades
+that require the payment of a minimum transaction fee for all transactions. If transaction fees paid for digital asset transactions become
+too high, the marketplace for digital assets as a means of payment and a store of value may be reduced as existing users are motivated
+to switch from one digital asset to another digital asset or back to fiat currency. There is no guarantee that the bitcoin network will
+be able to transition to system where transaction fees constitute the primary or sole reward for mining without also reducing the attractiveness
+of bitcoin to end users. Decreased use and demand for bitcoins that we have accumulated may adversely affect its value and may adversely
+impact an investment in it, which in turn would harm our business, financial condition or results of operations. Furthermore, market participants
+may not be willing to pay transaction fees to process bitcoin transactions at levels equivalent to the revenue miners earn from bitcoin
+awards, which could substantially reduce the profitability of mining, which could have a material adverse effect on our business, operating
+results and financial condition.
+
+ 
+
+ 
+
+ 
+
+ 22 
+
+ 
+
+ 
+
+ 
+
+To the extent that any miners cease to record transactions in
+solved blocks, transactions that do not include the payment of a transaction fee will not be recorded on the blockchain until a block
+is solved by a miner who does not require the payment of transaction fees. Any widespread delays in the recording of transactions could
+result in a loss of confidence in that digital asset network.
+
+ 
+
+To the extent that any miners cease to record transactions
+in solved blocks, such transactions will not be recorded on the blockchain. Currently, miners routinely record all transactions in solved
+blocks, including those for which no transaction fee is collected, because the bitcoin rewards from solving the block provide sufficient
+incentives. However, those bitcoin rewards are scheduled to reduce over time until they are eliminated entirely in 2040. The reduction
+and ultimate elimination of bitcoin rewards for solving a block may cause miners or mining pools to force bitcoin users to pay transaction
+fees as a substitute for or in addition to the award of new bitcoins upon the solving of a block. Those actions could delay the recording
+and confirmation of transactions on the blockchain. Any systemic delays in the recording and confirmation of transactions on the blockchain
+could result in greater exposure to double-spending transactions and a loss of confidence in certain or all digital asset networks, which
+could adversely affect our business, financial condition and results of operations.
+
+ 
+
+If a malicious actor or botnet obtains control in excess of 50%
+of the processing power active on any digital asset network, including the bitcoin network, it is possible that such actor or botnet could
+manipulate the blockchain in a manner that adversely affects our business. 
+
+ 
+
+If a malicious actor or botnet (a volunteer or
+hacked collection of computers controlled by networked software coordinating the actions of the computers) obtains a majority of the processing
+power dedicated to mining on any digital asset network, it may be able to alter the blockchain by constructing alternate blocks if it
+is able to solve for such blocks faster than the remainder of the miners on the blockchain can add valid blocks. Within the alternate
+blocks, the malicious actor or botnet could control, exclude or modify the ordering of transaction. However, it could not generate new
+digital assets or transactions using such control. Using alternate blocks, the malicious actor or botnet could double-spend 
+its own digital assets (i.e., spend the same digital assets in more than one transaction) and prevent the confirmation of other users 
+transactions for so long as it maintains control. To the extent that such malicious actor or botnet does not yield its majority control
+of the processing power or the digital asset community does not reject the fraudulent blocks as malicious, reversing any changes made
+to the blockchain may not be possible. Such changes could adversely our business, financial condition and results of operations.
+
+ 
+
+The approach towards and possible crossing of the
+50% threshold indicates a greater risk that a single mining pool could exert authority over the validation of digital asset transactions.
+To the extent that the digital assets ecosystems do not act to ensure greater decentralization of digital asset mining processing power,
+the feasibility of a malicious actor obtaining in excess of 50% of the processing power on any digital asset network (e.g., through control
+of a large mining pool or through hacking such a mining pool) will increase, which could adversely affect our business, financial condition
+and results of operations.
+
+ 
+
+Our reliance on third-party mining pool service providers for
+our mining revenue payouts may have a negative impact on our operations.
+
+ 
+
+We utilize one third party mining pool to receive
+our mining rewards from a given network. Mining pools allow mining participants to combine their processing power, which increases the
+chances of solving a block and getting paid by the network. The rewards are distributed by the pool operator, proportionally to our contribution
+to the pool s overall mining power used to generate each block. We are dependent on the accuracy of the mining pool operator s
+record keeping to accurately record the total processing power provided to the pool for a given bitcoin or other digital asset mining
+application in order to assess the proportion of that total processing power we provided. While we have internal methods of tracking both
+our power provided and the total power used by the pool, the mining pool operator uses its own record-keeping to determine our proportion
+of a given reward. We have little means of recourse against the mining pool operator if we determine the proportion of the reward paid
+out to us by a mining pool operator is incorrect, other than leaving the pool. If we are unable to consistently obtain accurate proportionate
+rewards from our mining pool operators, we may experience reduced reward for our efforts, which would have an adverse effect on our business,
+financial condition and results of operations.
+
+ 
+
+ 
+
+ 
+
+ 23 
+
+ 
+
+ 
+
+ 
+
+Bitcoin is subject to halving, and as such the reward for successfully
+solving a block will halve several times in the future and its value may not adjust to compensate us for the reduction in the rewards
+we receive from our mining efforts, which could cause us to cease our mining operations altogether and investors could suffer a complete
+loss of their investment.
+
+ 
+
+Halving is a process designed to control the overall
+supply and reduce the risk of inflation in digital assets using a Proof-of-Work consensus algorithm. In an event referred to as bitcoin
+ halving, the bitcoin reward for mining any block is cut in half. For example, the mining reward for bitcoin declined from
+6.25 to 3.125 bitcoin on April 19, 2024. This process is scheduled to occur once every 210,000 blocks. It is estimated that bitcoin will
+next halve in April 2028 and then approximately every four years thereafter until the total amount of bitcoin rewards issued reaches 21
+million, which is expected to occur around 2140. Once 21 million bitcoin are generated, the network will stop producing more. Currently,
+there are more than 19 million bitcoin in circulation. While bitcoin prices have had a history of price fluctuations around halving events,
+there is no guarantee that any such price change will be favorable or would compensate for the reduction in mining reward. If a corresponding
+and proportionate increase in the price of bitcoin does not follow these anticipated halving events, the revenue from our mining operations
+would decrease, and we may not have an adequate incentive to continue mining and may cease mining operations altogether, which could adversely
+affect our business, financial condition and results of operations.
+
+ 
+
+A halving reduces the block rewards from mining
+by exactly 50%. However, a halving will not reduce revenues from mining by exactly 50% since part of the rewards consist of transaction
+fees which are not impacted by the halving. In recent periods, transaction fees have made up an ever-increasing share of mining revenue
+due to the impact of ordinals, which are increased transaction fees that are paid as parties have discovered ways to imbed
+data regarding other assets, such as art, in the bitcoin blockchain.
+
+ 
+
+Furthermore, such reductions in bitcoin rewards
+for uncovering blocks may result in a reduction in the aggregate hashrate of the bitcoin network as the incentive for miners decreases.
+Miners ceasing operations would reduce the collective processing power on the network, which would adversely affect the confirmation process
+for transactions and make the bitcoin network more vulnerable to malicious actors or botnets obtaining control in excess of 50% of the
+processing power active on the blockchain. Such events may adversely affect our business, financial condition and results of operations.
+
+ 
+
+The elimination of ordinals could have a material adverse effect
+on our results of operations and financial condition.
+
+ 
+
+Since early January 2023, transaction fees have
+made up an ever-increasing share of mining revenue due to the impact of ordinals, which are increased transaction fees that
+are paid as parties have discovered ways to imbed data regarding other assets, such as art, in the bitcoin blockchain. There is some concern
+among the parties who manage the bitcoin blockchain as to whether ordinals should be permitted, since their inclusion tends to slow down
+validation of transactions on the blockchain. If the bitcoin blockchain managers decide to eliminate ordinals, we could lose an important
+source of revenue from our mining operations, which could have a material adverse effect on our results of operations and financial condition.
+
+ 
+
+To the extent that the profit margins of digital asset mining
+operations are not high, operators of digital asset mining operations are more likely to immediately sell their digital assets earned
+by mining in the digital asset exchange market, resulting in a reduction in the price of digital assets.
+
+ 
+
+Over the past two years, digital asset mining operations
+have evolved from individual users mining with computer processors, graphics processing units and first-generation miners. Currently,
+new processing power brought onto the digital asset networks is predominantly added by professionalized mining operations.
+Professionalized mining operations may use proprietary hardware or sophisticated machines.
+
+ 
+
+ 
+
+ 
+
+ 24 
+
+ 
+
+ 
+
+ 
+
+Professionalized mining operations require:
+
+ 
+
+ 
+ 
+ the investment of significant capital for the acquisition of such hardware;
+
+ 
+ 
+ 
+
+ 
+ 
+ the leasing of operating space (often in data centers or warehousing facilities);
+
+ 
+ 
+ 
+
+ 
+ 
+ incurring of electricity costs; and
+
+ 
+ 
+ 
+
+ 
+ 
+ the employment of technicians to operate the mining farms.
+
+ 
+ 
+
+As a result, professionalized mining operations
+are of a greater scale than prior miners and have more defined, regular expenses and liabilities. These regular expenses and liabilities
+require professionalized mining operations to more immediately sell digital assets earned from mining operations on the digital asset
+exchange market. To the contrary, it is believed that past individual miners were more likely to hold mined digital assets for more extended
+periods. The immediate selling of newly mined digital assets greatly increases the supply of digital assets on the digital asset exchange
+market, creating downward pressure on the price of each digital asset.
+
+ 
+
+The extent to which the value of digital assets
+mined by a professionalized mining operation exceeds the allocable capital and operating costs determines the profit margin of such operation.
+A professionalized mining operation may be more likely to sell a higher percentage of its newly mined digital assets rapidly if it is
+operating at a low profit margin - and it may partially or completely stop operations if its profit margin is negative.
+
+ 
+
+In a low profit margin environment, a higher percentage
+could be sold into the digital asset exchange market more rapidly, potentially reducing digital asset prices. Lower digital asset prices
+may result in further tightening of profit margins, particularly for professionalized mining operations with higher costs and more limited
+capital reserves, creating a network effect that may further reduce the price of digital assets until mining operations with higher operating
+costs become unprofitable and remove mining power from the respective digital asset network. The network effect of reduced profit margins
+resulting in greater sales of newly mined digital assets could result in a reduction in the price of digital assets which could have a
+materially adversely effect on our business, financial condition, or results of operations.
+
+ 
+
+Our reliance on immersion-cooling exposes us to additional risks.
+
+ 
+
+Our business is also active in developing hosting
+sites that use immersion-cooling, an emerging technology in bitcoin mining, which is not in wide-spread use in the bitcoin mining industry,
+and has yet to be deployed in large scale. Immersion cooling is the process of submerging computer components (or full servers) in a thermally,
+but not electrically, conductive liquid (dielectric coolant) allowing higher heat transfer performance than air and many other benefits.
+Industry literature indicates that immersion cooling improves the performance of miners and extends their life by dissipating heat more
+efficiently than air-cooling. However, immersion-cooling is still an evolving industry, and the long-term benefits from immersion cooling
+over air-cooling may not be as great as promised. As such, there is a risk we may not succeed in deploying immersion-cooling at such a
+large scale to achieve sufficient cooling performance, which could adversely affect our business, financial condition and results of operations.
+
+ 
+
+Potential that, in the event of a bankruptcy filing by a custodian,
+bitcoin held in custody could be determined to be property of a bankruptcy estate and we could be considered a general unsecured creditor
+thereof.
+
+ 
+
+Substantially all of the bitcoin we hold is held
+in an account at BitGo Trust, a well-known custodian. The treatment of bitcoins held by custodians that file for bankruptcy protection
+is uncharted territory in U.S. Bankruptcy law. We cannot say with certainty whether our bitcoin held in custody by BitGo, should it declare
+bankruptcy, would be treated as property of the bankruptcy estate and, accordingly, whether we would be treated as a general unsecured
+creditor with respect of our bitcoin held in custody by BitGo. If we are treated as a general unsecured creditor, we may not be able to
+recover our bitcoin in the event of a BitGo bankruptcy or a bankruptcy of any other custodian we may use in the future. Historically,
+we have mitigated our risk of a bankruptcy by our custodian by routinely liquidating our bitcoin shortly after it is earned. When we liquidate
+bitcoin, we typically have the proceeds wired to our bank account a day or two later. However, we plan to invest substantially all of
+the net proceeds in this offering in bitcoin, which may increase our risk in the event of a failure of the custodian.
+
+ 
+
+ 
+
+ 
+
+ 25 
+
+ 
+
+ 
+
+ 
+
+Any loss or destruction of a private key required to access a
+digital asset of ours is irreversible. We also may temporarily lose access to any digital assets we hold in a cold wallet account.
+
+ 
+
+Digital assets are each accessible and controllable
+only by the possessor of both the unique public key and private key associated with the digital asset, wherein the public and private
+keys are held in an offline or online digital wallet. To the extent a private key is lost, destroyed or otherwise compromised and no backup
+of the private key is available, we will be unable to access the applicable digital asset associated with that private key and the private
+key cannot be restored. As a result, any digital assets associated with such key could be irretrievably lost. Any loss of private keys
+relating to digital wallets used to store the applicable digital assets could have a material adverse effect on our business, financial
+condition and results of operations.
+
+ 
+
+We do not currently hold any digital assets
+in an online wallet account. We hold substantially all of our digital assets at BitGo and a de minimis amount at Genesis. We have also
+onboarded Fidelity Digital Assets, with the intention of storing long-term digital assets held for investment and as collateral, with
+this custodian. There can be no assurances that any processes we have adopted or will adopt in the future are or will be secure or effective,
+and we would experience significant and immediate adverse effects if we suffered a loss of our digital currency due to an adverse software
+or cybersecurity event.
+
+ 
+
+Security threats to our business could result in, a loss of our
+digital assets, or damage to our reputation and our brand.
+
+ 
+
+Security breaches, computer malware and computer
+hacking attacks have been a prevalent concern in the digital asset exchange markets. A security breach caused by hacking, could include,
+but is not limited to:
+
+ 
+
+ 
+ 
+ efforts to gain unauthorized access to information or systems;
+
+ 
+ 
+ 
+
+ 
+ 
+ efforts to cause intentional malfunctions or loss or corruption of data, software, hardware or other computer equipment; and
+
+ 
+ 
+ 
+
+ 
+ 
+ the inadvertent transmission of computer viruses.
+
+ 
+ 
+
+A security breach by hacking could harm our operations
+or result in loss of our digital assets. Any breach of our and our partners infrastructure could result in reputational harm and
+erode the trust of our partners and stockholders, which could adversely affect an investment in our securities. Furthermore, as our assets
+grow, we may become a more appealing target for security threats such as hackers and malware.
+
+ 
+
+Our security system and operational infrastructure
+may be breached due to the actions of outside parties, error or malfeasance of an employee, or otherwise, and, as a result, an unauthorized
+party may obtain access to our private keys, data or bitcoins. Additionally, outside parties may attempt to fraudulently induce our employees
+to disclose sensitive information in order to gain access to our infrastructure.
+
+ 
+
+Despite our efforts, we may be unable to anticipate
+these techniques or implement adequate preventative measures since the hacking techniques used are often not recognized until launched
+against a target. If an actual or perceived breach of our security system occurs, the market perception of the effectiveness of our controls
+could be harmed.
+
+ 
+
+Further, in the event of a security breach, we
+may be subject to litigation forced to cease operations, or suffer a reduction in assets, the occurrence of each of which could adversely
+affect our business, financial condition, or results of operation.
+
+ 
+
+Our ability to adopt technology in response to changing security
+needs or trends and our reliance on, third-party custody providers, poses a challenge to the safekeeping of our digital assets.
+
+ 
+
+The history of digital asset exchanges has shown
+that exchanges and large holders of digital assets must adapt to technological change in order to secure and safeguard their digital assets.
+We rely on the security solutions of third-party custodians, who we believe have developed physically secure environment based on established,
+industry best practices, to safeguard our digital assets from theft, loss, destruction or other issues relating to hackers and technological
+attack.
+
+ 
+
+ 
+
+ 
+
+ 26 
+
+ 
+
+ 
+
+ 
+
+We believe we may become a more appealing target
+of security threats as the size of our bitcoin holdings grow. To the extent that we, or any of our third-party custody providers, are
+unable to identify, mitigate or stop new security threats, our digital assets may be subject to theft, loss, destruction or other attack,
+which could adversely affect an investment in our securities.
+
+ 
+
+Digital asset transactions are irrevocable and stolen or incorrectly
+transferred digital assets may be irretrievable. 
+
+ 
+
+Digital asset transactions are not, from an administrative
+perspective, reversible without the consent and active participation of the recipient of the transaction or, in theory, control or consent
+of a majority of the processing power on that digital asset network. Once a transaction has been verified and recorded in a block that
+is added to the blockchain, an incorrect transfer of digital assets or a theft of digital assets generally will not be reversible, and
+we may not be capable of seeking compensation for any such transfer or theft.
+
+ 
+
+In the course of our business operations, we regularly
+transfer digital assets to or from custodians, vendors, consultants, and services providers. As such, it is possible that, through computer
+or human error, or through theft or criminal action, such assets could be transferred in incorrect amounts or to unauthorized third parties.
+
+ 
+
+To the extent we are unable to seek a corrective
+transaction to identify the third party which has received our digital assets through error or theft, we will be unable to revert or otherwise
+recover the impacted digital assets, and any such loss could adversely affect an investment in our securities.
+
+ 
+
+The limited rights of legal recourse available to us, and our
+lack of insurance protection expose us and our stockholders to the risk of loss of our digital assets for which no person is liable.
+
+ 
+
+Our digital assets are not insured. If our digital
+assets are lost, stolen or destroyed under circumstances rendering a party liable to us, the responsible party may not have the financial
+resources sufficient to satisfy our claim. For example, as to a particular event of loss, the only source of recovery for us might be
+limited to the extent identifiable, other responsible third parties (e.g., a thief or terrorist), any of which may not have the financial
+resources (including liability insurance coverage) to satisfy a valid claim. Furthermore, bitcoin is not subject to Federal Deposit Insurance
+Corporation ( FDIC ) or Securities Investor Protection Corporation protection, which is the protection afforded to depositors
+at banking institutions. Therefore, a loss may be suffered with respect to our digital assets for which no recourse is available, which
+could adversely affect our operations and, consequently, an investment in our securities.
+
+ 
+
+If we or our third-party service providers experience a security
+breach or cyberattack and unauthorized parties obtain access to our bitcoin, we may lose some or all of our bitcoin and our financial
+condition and results of operations could be materially adversely affected.
+
+ 
+
+Security breaches and cyberattacks are of particular
+concern with respect to our bitcoin. Bitcoin and other blockchain-based digital assets have been, and may in the future be, subject to
+security breaches, cyberattacks, or other malicious activities. A successful security breach or cyberattack could result in a partial
+or total loss of our bitcoin in a manner that may not be covered by insurance or indemnity provisions of the custody agreement with a
+custodian who holds our bitcoin. Such a loss could have a material adverse effect on our financial condition and results of operations.
+
+ 
+
+We rely on third-party hosting for much of our mining activity,
+and as such, our operations could be adversely affected by the actions or inactions of such third-parties. Additionally, third-party hosting,
+among other things, often requires us to give the hosting company a first lien on the miners installed on the site and creates business
+risk for us.
+
+ 
+
+We currently rely upon third-party hosting facilities
+to power most of our miners. As of the date of this prospectus, our third-party hosting operators host 3,752 of our bitcoin miners or
+approximately 90% of our miners. Our operations and ability to mine bitcoin could be adversely affected if operators we
+rely on to operate our bitcoin miners experience general incompetence in performing their duties, experience financial difficulties or
+bankruptcy, or otherwise cannot operate our bitcoin miners in accordance with their contractual obligations.
+
+ 
+
+ 
+
+ 
+
+ 27 
+
+ 
+
+ 
+
+ 
+We are dependent upon the financial viability of our
+third-party hosting operators, and in 2022, several large publicly traded hosting companies met severe financial issues, including bankruptcies.
+Currently, approximately 95% of our third-party hosting is operated by Soluna Holdings, Inc., the parent company DVSL ComputeCo, LLC.
+As a result, our operations are highly dependent on these third-parties and could be adversely affected by the actions or inactions of
+our third-party hosting operators.
+
+ 
+
+Furthermore, in most hosting contracts, there is
+a requirement that the miner agrees to permit the hosting company to place a lien on the actual mining machines being hosted. If the hosting
+company files for bankruptcy, it may take months for the liens to be lifted, while the bankruptcy court and parties litigate these contracts
+and resolves issues as to ownership of assets and related areas. In these contracts, we may be required to make significant deposits against
+future mining fees. If the hosting party utilizes the deposits, we could risk loss of the deposits and be left with an unsecured claim
+in the bankruptcy. Lastly, as the bankruptcy process includes an automatic stay in favor of the debtor company, until the stay is lifted
+or a bankruptcy plan approved, we may not be able to move our miners to a different location, even if the debtor rejects our hosting contract.
+
+ 
+
+The termination of our hosting agreement with Soluna SW, LLC,
+may cause a decrease in revenue.
+
+ 
+
+On April 8,
+2025, Soluna SW, LLC, which hosts 1,095 ASIC miners for us at its Murray, Kentucky location, elected not to renew its hosting agreement
+with us on the existing terms, and on April 30, 2025, we terminated our engagement with Soluna SW, LLC. We sold 850 of the ASIC miners
+hosted by Soluna, SW LLC to a third party and plan to move the remaining 245 to the Silverton, Texas location. Due to the sale of certain
+ASIC miners and transfer of the remaining to a new location, our future revenue will be reduced accordingly. In addition, revenue for
+the next two quarters may be adversely impacted by downtime associated with the transfer process.
+
+ 
+
+We are subject to risk that key counterparties file bankruptcy, enter insolvency proceedings or otherwise
+default on their obligations to us.
+
+ 
+We
+ are subject to the risk that counterparties with whom we do business default on their obligations
+ to us. While we may have rights to recover damages for breach of contract in the event of
+ a default, our contractual remedies may not compensate us for all of our damages, including
+ particularly legal fees or lost opportunity costs. Even if we receive a judgment or award
+ that covers all of our damages, we may not be able to collect the judgment in full due to
+ the insolvency of the counterparty. Furthermore, the counterparty or its assets may be in
+ a legal system where it is difficult to receive a judgment or collect any judgment. At this
+ time, we have two counterparties whose default could result in material losses for us. One
+ is ROC Digital, which owed us $655,277 as of August 31, 2024 from the sale of equipment,
+ and for which we have also made an equity investment of approximately $987,000 by the contribution
+ of equipment. In the case of ROC Digital, a default could impair our ability to realize our
+ investment in each entity. The other is Soluna Holdings, Inc., which hosts 3,145 miners for
+ us (with 245 miners pending installation). A default by Soluna Holdings, Inc. could cause
+ us to incur material costs to repossess our miners, a disruption in our revenues during the
+ period that the miners are not operating, and increase our costs in the future if we are
+ not able to enter into alternative hosting arrangements that are as attractive as of those
+ offered by Soluna.
+
+ 
+
+We do not own any intellectual property, which may limit our
+competitive position and increase operational risks. 
+
+ 
+
+We do not currently own any patents, trademarks,
+service marks or copyrights in connection with our existing and planned bitcoin mining-related operations. This lack of intellectual property
+ownership presents several challenges and risks to our business and financial condition.
+
+ 
+
+Without proprietary intellectual property, we may
+be unable to establish a distinct competitive advantage in the market. The absence of registered trademarks exposes us to the possibility
+of competitors using similar branding, which could create market confusion, dilute our reputation, or undermine trust in our brand. Without
+adequate trademark protection, we may be unable to prevent third parties from leveraging our goodwill and misrepresenting their services
+as ours, potentially impacting public loyalty and our revenue.
+
+ 
+
+Not owning patents limits our ability to protect
+any technological advancements, operational methods, or unique processes we may develop. Competitors with patented technologies may secure
+a competitive edge by achieving greater efficiency or performance, while we remain reliant on third-party solutions.
+
+ 
+
+The absence of intellectual property also increases
+the likelihood of encountering legal disputes over the use of third-party technologies. If we inadvertently infringe on intellectual property
+rights owned by others, we could face costly litigation, damages, or interruptions to our operations. Furthermore, the need to license
+or purchase necessary tools and resources from external sources may lead to higher costs, reducing our overall profitability.
+
+ 
+
+Without critical intellectual property protections,
+our ability to differentiate ourselves, build a strong market presence, and protect our operational advantages may be significantly constrained.
+These factors may negatively impact on our competitiveness and profitability.
+
+ 
+
+ 
+
+ 
+
+ 28 
+
+ 
+
+ 
+
+ 
+
+Intellectual property rights claims may adversely affect the
+operation of some or all digital asset networks.
+
+ 
+
+Third parties may assert intellectual property
+claims relating to the holding and transfer of digital assets and their source code. Regardless of the merit of any intellectual property
+or other legal action, any threatened action that reduces confidence in some or all digital asset networks long-term viability
+or the ability of end-users to hold and transfer digital assets may adversely affect an investment in our securities. Additionally, a
+meritorious intellectual property claim could prevent us and other end-users from accessing some or all digital asset networks or holding
+or transferring our digital assets. As a result, an intellectual property claim against us or other large digital asset network participants
+could adversely affect our business operations and financial condition.
+
+ 
+
+Our future success depends on our ability to keep pace with rapid
+technological changes that could make our current or future technologies less competitive or obsolete.
+
+ 
+
+Rapid, significant and disruptive technological
+changes continue to impact our industry. The infrastructure at our hosting facilities may become less marketable due to demand for new
+processes and technologies, including, without limitation: (i) new processes to deliver power to, or eliminate heat from, computer
+systems; (ii) customer demand for additional redundancy capacity; (iii) new technology that permits higher levels of critical
+load and heat removal than our hosting facilities are currently designed to provide; (iv) an inability of the power supply to support
+new, updated or upgraded technology; and (v) a shift to more power-efficient transaction validation protocols. In addition, the systems
+that connect our hosting facilities to the Internet and other external networks may become insufficient, including with respect to latency,
+reliability and diversity of connectivity. We may not be able to adapt to changing technologies, identify and implement new alternatives
+successfully or meet customer demands for new processes or technologies in a timely and cost-effective manner, if at all, which would
+have a material adverse effect on our business, financial condition and results of operations.
+
+ 
+
+Variability in intellectual property laws may adversely affect
+our intellectual property position.
+
+ 
+
+Intellectual property laws, and patent laws and
+regulations in particular, have been subject to significant variability either through administrative or legislative changes to such laws
+or regulations or changes or differences in judicial interpretation, and it is expected that such variability will continue to occur.
+Additionally, intellectual property laws and regulations differ among states, and countries. Variations in patent laws and regulations
+or in interpretations of patent laws and regulations in the United States and other countries may diminish the value of our intellectual
+property and may change the impact of third-party intellectual property on our business. Accordingly, we cannot predict the scope of patents
+that may be granted to us, the extent to which we will be able to enforce our patents against third parties, or the extent to which third
+parties may be able to enforce their patents against us.
+
+ 
+
+We may seek to internally develop new inventions and intellectual
+property, which would take time and be costly. Moreover, the failure to obtain or maintain intellectual property rights for such inventions
+would lead to the loss of our investments in such activities.
+
+ 
+
+While we currently do not own any material intellectual
+property rights that are crucial to our business, we may in the future develop proprietary intellectual property rights that are essential
+to our business. These activities would require significant amounts of financial, managerial and other resources and would take time to
+achieve. Such activities could also distract our management team from our present business initiatives, which could have a material and
+adverse effect on our business. There is also the risk that such initiatives may not yield any viable new business or revenue, inventions
+or technology, which would lead to a loss of investment in such activities.
+
+ 
+
+ 
+
+ 
+
+ 29 
+
+ 
+
+ 
+
+ 
+
+In addition, even if we are able to internally
+develop new inventions, in order for those inventions to be viable and to compete effectively, we would need to develop and maintain a
+proprietary position with respect to such inventions and intellectual property. However, there are significant risks associated with any
+such intellectual property we may develop principally including the following:
+
+ 
+
+ 
+ 
+ patent applications we may file may not result in issued patents or may take longer than we expect to result in issued patents;
+
+ 
+ 
+ 
+
+ 
+ 
+ we may be subject to interference proceedings;
+
+ 
+ 
+ 
+
+ 
+ 
+ we may be subject to opposition proceedings in the United States or foreign countries;
+
+ 
+ 
+ 
+
+ 
+ 
+ any patents that are issued to us may not provide meaningful protection;
+
+ 
+ 
+ 
+
+ 
+ 
+ we may not be able to develop additional proprietary technologies that are patentable;
+
+ 
+ 
+ 
+
+ 
+ 
+ other companies may challenge patents issued to us;
+
+ 
+ 
+ 
+
+ 
+ 
+ other companies may have independently developed and/or patented (or may in the future independently develop and patent) similar or alternative technologies, or duplicate our technologies;
+
+ 
+ 
+ 
+
+ 
+ 
+ other companies may design around technologies we have developed; and
+
+ 
+ 
+ 
+
+ 
+ 
+ enforcement of our patents would be complex, uncertain and very expensive.
+
+ 
+ 
+
+We cannot be certain that any patents, if issued,
+will provide us with adequate protection from competing products. For example, issued patents may be circumvented or challenged, declared
+invalid or unenforceable, or narrowed in scope. In addition, since publication of discoveries in scientific or patent literature often
+lags behind actual discoveries, we cannot be certain that we will be the first to make our additional new inventions or to file patent
+applications covering those inventions. It is also possible that others may have or may obtain issued patents that could prevent us from
+commercializing our products or require us to obtain licenses requiring the payment of significant fees or royalties in order to enable
+us to conduct our business. As to any patents that we may acquire, our continued rights would depend on meeting any obligations to the
+seller and we may be unable to do so. Our failure to obtain or maintain intellectual property rights for our inventions could lead to
+the loss of our investments in such activities, which would have a material adverse effect on our business, financial condition, or results
+of operation.
+
+ 
+
+Moreover, patent application delays could cause
+delays in recognizing revenue from any internally generated patents and could cause us to miss opportunities to license patents before
+other competing technologies are developed or introduced into the market. We are not actively pursuing any commercialization opportunities
+or internally generated patents.
+
+ 
+
+Our future success depends on our ability to expand our organization
+to match the growth of our activities.
+
+ 
+
+As our operations grow, the administrative demands
+and scaling demands upon us will grow, and our success will depend upon our ability to meet those demands. We require certain financial,
+managerial and other resources, which could create challenges to our ability to successfully manage our subsidiaries and operations and
+impact our ability to assure compliance with our policies, practices and procedures. These demands include, but are not limited to, increased
+executive, accounting, management, legal services, staff support and general office services. Currently, we have limited personnel in
+our organization to meet our organizational and administrative demands. We may need to hire additional qualified personnel to meet these
+demands, the cost and quality of which is dependent in part upon market factors outside of our control. Further, we will need to effectively
+manage the training and growth of our staff to maintain an efficient and effective workforce, and our failure to do so could adversely
+affect our business and operating results.
+
+ 
+
+ 
+
+ 
+
+ 30 
+
+ 
+
+ 
+
+ 
+
+We are highly dependent on the continued services of our small
+team of executives.
+
+ 
+
+We are dependent upon the efforts and services
+of our small executive team. Consequently, the loss of any one of our key executives could have an adverse effect on our operations.
+
+ 
+
+Joint venture investments could be
+adversely affected by our lack of sole decision-making authority, our reliance on the financial condition of co-venturers and disputes
+between us and our co-venturers.
+
+ 
+
+In October 2022, we entered into a joint venture
+arrangement with ROC Manager to jointly develop and operate a bitcoin mining operation in Pecos, Texas and may continue to enter into
+joint ventures, partnerships and other co-ownership arrangements (including preferred equity investments) in the future. In such event,
+we may not be in a position to exercise sole decision-making authority regarding the joint venture. Investments in joint ventures
+may, under certain circumstances, involve risks not present were a third-party not involved, including the possibility that partners or
+co-venturers might become bankrupt or fail to fund their required capital contributions. Co-venturers may have economic or other business
+interests or goals which are inconsistent with our business interests or goals, and may be in a position to take actions contrary to our
+policies or objectives. These investments may also have the potential risk of impasses on decisions, such as a sale, because neither we
+nor the co-venturer would have full control over the joint venture. Disputes between us and co-venturers may result in litigation
+or arbitration that would increase our expenses and prevent our officers or directors from focusing their time and effort on our business.
+Consequently, actions by or disputes with co-venturers might result in subjecting properties owned by the joint venture to additional
+risk. In addition, we may in certain circumstances be liable for the actions of our co-venturers.
+
+ 
+
+We have engaged in, and in the future may engage in, strategic
+acquisitions and other arrangements that could disrupt our business, cause dilution to our stockholders, reduce our financial resources
+and harm our operating results.
+
+ 
+
+In the future, we may seek additional opportunities
+to grow our mining operations through strategic acquisitions, including through purchases of miners, data centers and other facilities
+from other operating companies, including companies in financial distress. Our ability to grow through future acquisitions will depend
+on the availability of, and our ability to identify, suitable acquisition and investment opportunities at an acceptable cost, our ability
+to compete effectively to attract those opportunities and the availability of financing to complete acquisitions. Future acquisitions
+may require us to issue common stock that would dilute our current stockholders percentage ownership, assume or otherwise be subject
+to liabilities of an acquired company, record goodwill and non-amortizable intangible assets that will be subject to impairment testing
+on a regular basis and potential periodic impairment charges, incur amortization expenses related to certain intangible assets, incur
+large acquisition and integration costs, immediate write-offs, and restructuring and other related expenses and become subject to litigation.
+
+ 
+
+The benefits of an acquisition or our expansion
+into may also take considerable time to develop, and we cannot be certain that any particular acquisition will produce the intended benefits
+in a timely manner or to the extent anticipated or at all. We may experience difficulties integrating the operations, technologies and
+personnel of an acquired company or be subjected to liability for the target s pre-acquisition activities or operations as a successor
+in interest. Such integration may divert management s attention from normal daily operations of our business. Future acquisitions
+may also expose us to potential risks, including risks associated with entering markets in which we have no or limited prior experience,
+especially when competitors in such markets have stronger market positions, the possibility of insufficient revenues to offset the expenses
+we incur in connection with an acquisition and the potential loss of, or harm to, our relationships with employees and suppliers as a
+result of integration of new businesses.
+
+ 
+
+In addition to mining and holding bitcoin, we have
+explored, and we may in the future explore, opportunities to become more involved in businesses that expand or supplement those directly
+related to the self-mining of bitcoin as favorable market conditions and opportunities arise. We cannot be certain that such opportunities
+will produce the intended benefits in a timely manner or to the extent anticipated or at all. These opportunities could also expose us
+to similar risks associated with strategic acquisitions, as discussed above.
+
+ 
+
+ 
+
+ 
+
+ 31 
+
+ 
+
+ 
+
+ 
+
+Increased scrutiny and changing expectations from stockholders
+with respect to our environmental, social and governance ( ESG ) practices and the impacts of climate change may result in
+additional costs or risks.
+
+ 
+
+Companies across many industries are facing increasing
+scrutiny related to their ESG practices. Investor advocacy groups, certain institutional investors, investment funds and other influential
+investors are also increasingly focused on ESG practices and in recent years have placed increasing importance on the non-financial impacts
+of their investments. In May 2021, the SEC proposed rule changes that would require public companies to include certain climate-related
+disclosures in their periodic reports, including information about climate-related risks that are reasonably likely to have a material
+impact on their business, results of operations, or financial condition, and certain climate-related financial statement metrics in a
+note to their audited financial statements noting that such rule changes were proposed in response to investor demands for consistent
+and comparable data on climate change. Furthermore, increased public awareness and concern regarding environmental risks, including global
+climate change, may result in increased public scrutiny of our business and our industry, and our management team may divert significant
+time and energy away from our operations and towards responding to such scrutiny and reassuring our employees. The implementation of the
+SEC s proposed rule changes was stayed in April 2024 in response to consolidated legal challenges. However, should the rule changes
+ultimately become effective, in either their current or a revised form, we, as a public company, may also face increased oversight from
+the SEC with respect to our climate-related disclosures.
+
+ 
+
+In addition, the physical risks of climate change
+may impact the availability and cost of materials and natural resources, sources and supplies of energy, and demand for bitcoin and other
+cryptocurrencies, and could increase our insurance and other operating costs, including, potentially, to repair damage incurred as a result
+of extreme weather events or to renovate or retrofit facilities to better withstand extreme weather events. If environmental laws or regulations
+or industry standards are either changed or adopted and impose significant operational restrictions and compliance requirements on our
+operations, or if our operations are disrupted due to physical impacts of climate change, our business, capital expenditures, results
+of operations, financial condition and competitive position could be negatively impacted.
+
+ 
+
+Delays in the construction of our hosting facilities or significant
+cost overruns could present significant risks to our business.
+
+ 
+
+The servers used for digital asset transaction
+processing and colocation hosting require the use of facilities ( hosting facilities ) with a highly specialized infrastructure
+and considerable, reliable power in order to compete effectively. Our growth strategy is to build mining capacity in locations that have
+reliable sources of low-cost power, and to utilize that capacity to host third-party miners and to host our own proprietary mining equipment.
+We have completed our initial hosting facility in Trinidad (which only commenced operations in October 2023 due to delays in the electrification
+of the facility). We are also a partner in a joint venture that recently completed a facility in Pecos, Texas. We continue to search for
+new locations for hosting facilities in the United States and Canada. We may face challenges in obtaining suitable land to build new hosting
+facilities, as we need to work closely with the local power suppliers and local governments of the places where our proposed hosting facilitates
+are located. Delays in actions that require the assistance of such third parties, in receiving required permits and approvals or in mediations
+with local communities, if any, may negatively impact our construction timelines and budget or result in any new hosting facilities not
+being completed at all. If we are unable to locate and complete on budget new hosting facilities in the future, our business, operating
+results and financial condition could be adversely affected.
+
+ 
+
+We are subject to risks associated with our need for significant
+electrical power.
+
+ 
+
+The operation of a bitcoin mining facility requires
+significant amounts of electrical power. Any mining site we currently operate or establish in the future can only be successful if we
+can continue to obtain sufficient electrical power for that site on a cost-effective basis. Our mining operations are conducted across
+a mix of leased properties and hosting agreements with third parties, each of which have unique power agreements. Geopolitical events
+including the war in Ukraine and inflationary impacts have caused power prices to increase worldwide; if power prices continue to increase
+while bitcoin prices decrease, our ability to profitability mine bitcoin would be negatively impacted.
+
+ 
+
+ 
+
+ 
+
+ 32 
+
+ 
+
+ 
+
+ 
+
+We may curtail the energy used by our mining operations
+in times of heightened energy prices or in the case of a grid-wide electricity shortage either voluntarily or by agreement with utility
+providers. We may also encounter other situations where utilities or government entities restrict or prohibit the provision of electricity
+to mining operations. In these cases, our ability to produce bitcoin may be negatively affected.
+
+ 
+
+Because we also expect to expand to additional
+sites, there may be significant competition for suitable locations with access to affordable power.
+
+ 
+
+Additionally, our facilities could be adversely
+affected by a power outage. Although there may be limited backup power at certain sites, it would not be feasible to run miners on back-up
+power generators in the event of a government restriction on electricity or a power outage. To the extent we are unable to receive adequate
+power supply and are forced to reduce or cease our operations due to the availability or cost of electrical power, our business would
+be adversely affected.
+
+ 
+
+We may not be able to compete effectively against our current
+and future competitors.
+
+ 
+
+The digital asset mining industry is highly innovative,
+rapidly evolving and characterized by healthy competition, experimentation, frequent introductions of new products and services and uncertain
+and evolving industry and regulatory requirements. We expect competition to further intensify in the future as existing and new competitors
+introduce new products or enhance existing products. We compete against a number of companies operating both within the United States
+and abroad, that have greater financial and other resources and that focus on digital asset mining, including businesses focused on developing
+substantial bitcoin mining operations. If we are unable to compete successfully, or if competing successfully requires us to take costly
+actions in response to the actions of our competitors, our business, operating results and financial condition could be adversely affected.
+
+ 
+
+Risks Related to Governmental Regulation and Enforcement
+
+ 
+
+We are subject to an extensive, highly evolving and uncertain
+regulatory and business landscape and any adverse changes to, or our failure to comply with, any laws and regulations, and adverse business
+reactions from counterparties could adversely affect our brand, reputation, business, operating results, and financial condition.
+
+ 
+
+Our business is subject to:
+
+ 
+
+ 
+ 
+ extensive laws;
+
+ 
+ 
+ 
+
+ 
+ 
+ rules, regulations;
+
+ 
+ 
+ 
+
+ 
+ 
+ policies;
+
+ 
+ 
+ 
+
+ 
+ 
+ orders;
+
+ 
+ 
+ 
+
+ 
+ 
+ determinations;
+
+ 
+ 
+
+ 
+ directives;
+
+ 
+ 
+ 
+
+ 
+ 
+ treaties;
+
+ 
+ 
+ 
+
+ 
+ 
+ legal and regulatory interpretations and guidance; and
+
+ 
+ 
+ 
+
+ 
+ 
+ counterparty risk in the markets in which we operate.
+
+ 
+ 
+
+ 
+
+ 
+
+ 33 
+
+ 
+
+ 
+
+ 
+
+Counterparty risk in the markets in which we operate
+includes:
+
+ 
+
+ 
+ 
+ regulatory aspects from financial services;
+
+ 
+ 
+ 
+
+ 
+ 
+ federal energy and other regulators;
+
+ 
+ 
+ 
+
+ 
+ 
+ the SEC;
+
+ 
+ 
+ 
+
+ 
+ 
+ the CFTC;
+
+ 
+ 
+ 
+
+ 
+ 
+ credit, crypto asset custody;
+
+ 
+ 
+ 
+
+ 
+ 
+ exchange, and transfer;
+
+ 
+ 
+ 
+
+ 
+ 
+ cross-border and domestic money and crypto asset transmission;
+
+ 
+ 
+ 
+
+ 
+ 
+ consumer and commercial lending;
+
+ 
+ 
+ 
+
+ 
+ 
+ usury;
+
+ 
+ 
+ 
+
+ 
+ 
+ foreign currency exchange;
+
+ 
+ 
+ 
+
+ 
+ 
+ privacy;
+
+ 
+ 
+ 
+
+ 
+ 
+ data governance;
+
+ 
+ 
+ 
+
+ 
+ 
+ data protection;
+
+ 
+ 
+ 
+
+ 
+ 
+ cybersecurity;
+
+ 
+ 
+ 
+
+ 
+ 
+ fraud detection;
+
+ 
+ 
+ 
+
+ 
+ 
+ antitrust and competition;
+
+ 
+ 
+
+ 
+ bankruptcy;
+
+ 
+ 
+ 
+
+ 
+ 
+ tax;
+
+ 
+ 
+ 
+
+ 
+ 
+ anti-bribery;
+
+ 
+ 
+ 
+
+ 
+ 
+ economic and trade sanctions;
+
+ 
+ 
+ 
+
+ 
+ 
+ anti-money laundering, and counter-terrorist financing;
+
+ 
+ 
+ 
+
+ 
+ 
+ the same regulatory risks applicable to counterparties which are most notably hosting businesses; and
+
+ 
+ 
+ 
+
+ 
+ 
+ the recent economic issues and bankruptcies befalling some in this industry.
+
+ 
+ 
+
+ 
+
+ 
+
+ 34 
+
+ 
+
+ 
+
+ 
+
+Many of these legal and regulatory regimes were
+adopted prior to the advent of the internet, mobile technologies, crypto assets, and related technologies. As a result, some applicable
+laws and regulations do not contemplate or address unique issues associated with the crypto economy, are subject to significant uncertainty,
+and vary widely across U.S. federal, state, and local and international jurisdictions. These legal and regulatory regimes, including the
+laws, rules, and regulations thereunder, evolve frequently and may be modified, interpreted, and applied in an inconsistent manner from
+one jurisdiction to another, and may conflict with one another. Moreover, the complexity and evolving nature of our business and the significant
+uncertainty surrounding the regulation of the crypto economy requires us to exercise our judgment as to whether certain laws, rules, and
+regulations apply to us, and it is possible that governmental bodies and regulators may disagree with our conclusions. To the extent we
+have not complied with such laws, rules, and regulations, we could be subject to significant fines, revocation of licenses, limitations
+on our products and services, reputational harm, and other regulatory consequences, each of which may be significant and could adversely
+affect our business, operating results, and financial condition.
+
+ 
+
+Additionally, various governmental and regulatory
+bodies, including legislative and executive bodies, in the United States and in other countries may adopt new laws and regulations, the
+direction and timing of which may be influenced by changes in the governing administrations and major events in the crypto economy. For
+example, following the failure of several prominent crypto trading venues and lending platforms, such as FTX, Celsius Networks, Voyager
+and Three Arrows Capital in 2022 (even though these do not directly affect our business), the U.S. Congress expressed the need for both
+greater federal oversight of the crypto economy and comprehensive cryptocurrency legislation. In the near future, various governmental
+and regulatory bodies, including in the United States, may introduce new policies, laws, and regulations relating to crypto assets, the
+crypto economy, and crypto asset platforms. The failures of risk management and other control functions at other companies that played
+a role in these events could accelerate an existing regulatory trend toward stricter oversight of crypto asset platforms and the crypto
+economy.
+
+ 
+
+Due to our business activities, we may be subject
+to ongoing examinations, oversight, and reviews and currently are, and expect to be, subject to investigations and inquiries, by U.S.
+federal and state regulators, many of which have broad discretion to audit and examine our business. Moreover, new laws, regulations,
+or interpretations could result in litigation, regulatory investigations, and enforcement or other actions, including preventing or delaying
+us from offering certain products or services offered by our competitors or could impact how we offer such products and services. Adverse
+changes to, or our failure to comply with, any laws and regulations have had, and may continue to have, an adverse effect on our reputation,
+brand, business, operating results, and financial condition.
+
+ 
+
+Regulatory changes or actions may restrict the use of bitcoins
+or the operation of the bitcoin network.
+
+ 
+
+Until recently, little or no regulatory attention
+has been directed toward bitcoin and the bitcoin network by U.S. federal and state governments, foreign governments and self-regulatory
+agencies. As bitcoin has grown in popularity and in market size, the Federal Reserve Board, U.S. Congress and certain U.S. agencies (e.g.,
+the CFTC, the SEC, FinCEN and the Federal Bureau of Investigation) have begun to examine the operations of the bitcoin network, bitcoin
+users and the bitcoin exchange market.
+
+ 
+
+Digital assets currently face an uncertain regulatory
+landscape in not only the United States but also in many foreign jurisdictions, such as the European Union, China, India and Russia. While
+certain governments have issued guidance as to how to treat bitcoin, most regulatory bodies have not yet issued official statements regarding
+intention to regulate or determinations on regulation of bitcoin, the bitcoin network and bitcoin users. The effect of any future regulatory
+change on us, bitcoins, or other digital assets is impossible to predict, but such change could be substantial and adverse to us and could
+adversely affect our business operations and financial condition.
+
+ 
+
+Furthermore, one or more countries, such as China,
+India and Russia, may take regulatory actions in the future that severely restricts the right to acquire, own, hold, sell or use digital
+assets or to exchange digital assets for fiat currency. Such an action may also result in the restriction of ownership, holding or trading
+in our securities.
+
+ 
+
+ 
+
+ 
+
+ 35 
+
+ 
+
+ 
+
+ 
+
+If regulatory changes or interpretations require the regulation
+of bitcoins under the Securities Act and Investment Company Act by the SEC, we may be required to register and comply with such regulations.
+To the extent that we decide to continue operations, the required registrations and regulatory compliance steps may result in extraordinary,
+non-recurring expenses to us. We may also decide to cease certain operations. Any disruption of our operations in response to the changed
+regulatory circumstances may be at a time that is disadvantageous to investors. 
+
+ 
+
+Current and future legislation and the SEC rulemaking
+and other regulatory developments, including interpretations released by a regulatory authority, may impact the manner in which bitcoins
+are treated for classification and clearing purposes. The SEC s July 25, 2017 Report expressed its view that digital assets may
+be securities depending on the facts and circumstances. As of the date of this Annual Report, we are not aware of any rules that have
+been proposed to regulate bitcoins as securities. We cannot be certain as to how future regulatory developments will impact the treatment
+of bitcoins under the law. Such additional registrations may result in extraordinary, non-recurring expenses, thereby materially and adversely
+impacting an investment in our common stock. If we determine not to comply with such additional regulatory and registration requirements,
+we may seek to cease certain of our operations. Any such action may adversely affect our business operations and financial condition.
+
+ 
+
+To the extent that digital assets including bitcoins
+and other digital assets we own or may own are deemed by the SEC to fall within the definition of a security, we may be required to register
+and comply with additional regulation under the Investment Company Act, including additional periodic reporting and disclosure standards
+and requirements and our registration as an investment company.
+
+ 
+
+Additionally, although we are not engaged in the
+business of investing, reinvesting, or trading in securities, and we do not hold ourselves out as being engaged in those activities, we
+could inadvertently be deemed an investment company under the Investment Company Act. If we inadvertently are deemed an investment company
+and cannot rely on one of the exclusions under the Investment Company Act, then we would be required to register with the SEC.
+
+ 
+
+Furthermore, one or more states may conclude bitcoins
+and other digital assets we own or may own are a security under state securities laws which would require registration under state laws
+including merit review laws which would adversely impact us since we would likely not comply. As stated earlier in this Annual Report,
+some states including California define the term investment contract more strictly than the SEC.
+
+ 
+
+Such additional registrations, whether from regulatory
+developments or an inadvertent classification as an investment company, may result in extraordinary, non-recurring expenses for us, thereby
+materially and adversely impacting an investment in our securities. If we determine not to comply with such additional regulatory and
+registration requirements, we may seek to cease all or certain parts of our operations. Any such action would likely adversely affect
+an investment in our securities and investors may suffer a complete loss of their investment.
+
+ 
+
+If regulatory changes or interpretations of our activities require
+our registration as an MSB under the regulations promulgated by FinCEN under the authority of the BSA, or otherwise under state laws,
+we may incur significant compliance costs, which could be substantial or cost-prohibitive. 
+
+ 
+
+To the extent our bitcoin mining activities cause
+us to be deemed a money services business (an MSB ) under the regulations promulgated by the Financial Crimes Enforcement
+Network ( FinCEN ) under the authority of the U.S. Bank Secrecy Act (the BSA ), we may be required to comply
+with FinCEN regulations, including those that would mandate us to implement anti-money laundering programs, make certain reports to FinCEN
+and maintain certain records.
+
+ 
+
+To the extent that our cryptocurrency activities
+cause us to be deemed a money transmitter (an MT ) or be given an equivalent designation under state law in
+any state in which we operate, we may be required to seek a license or otherwise register with a state regulator and comply with state
+regulations that may include the implementation of anti-money laundering programs, maintenance of certain records and other operational
+requirements. Currently, the New York State Department of Financial Services maintains a comprehensive BitLicense framework
+for businesses that conduct virtual currency business activity. Effective August 2020, Louisiana enacted the Virtual Currency
+Businesses Act. The implementing regulations were formally adopted in late 2022. In October 2023, California enacted the Digital Financial
+Assets Law, which requires registration for certain digital financial asset business activities. We will continue to monitor for developments
+in state-level legislation, guidance or regulations applicable to us.
+
+ 
+
+ 
+
+ 
+
+ 36 
+
+ 
+
+ 
+
+ 
+
+Such additional federal or state regulatory obligations
+in the United States or obligations that could arise under the regulatory frameworks of other countries may cause us to incur significant
+expenses, possibly affecting our business and financial condition in a material and adverse manner. Furthermore, we and our service providers
+may not be capable of complying with certain federal or state regulatory obligations applicable to MSBs and MTs or similar obligations
+in other countries. If we are deemed to be subject to such additional regulatory oversight and registration or licensing requirements,
+we may be required to substantially alter our bitcoin mining activities and possibly cease engaging in such activities. Any such action
+may adversely affect our business operations and financial condition and an investment in our company.
+
+ 
+
+Current regulation regarding the exchange of bitcoins under the
+CEA by the CFTC is unclear; to the extent we become subject to regulation by the CFTC in connection with our exchange of bitcoin, we may
+incur additional compliance costs, which may be significant.
+
+ 
+
+The Commodity Exchange Act, as amended (the CEA ),
+does not currently impose any direct obligations on us related to the mining or exchange of bitcoins. Generally, the CFTC, the federal
+agency that administers the CEA, regards bitcoin and other cryptocurrencies as commodities. This position has been supported by decisions
+of federal courts.
+
+ 
+
+However, the CEA imposes requirements relative
+to certain transactions involving bitcoin and other digital assets that constitute a contract of sale of a commodity for future delivery
+(or an option on such a contract), a swap or a transaction involving margin, financing or leverage that does not result in actual delivery
+of the commodity within 28 days to persons not defined as eligible contract participants or eligible commercial entities 
+under the CEA (e.g., retail persons). Changes in the CEA or the regulations promulgated by the CFTC thereunder, as well as interpretations
+thereof and official promulgations by the CFTC, may impact the classification of bitcoin and, therefore, may subject bitcoin to additional
+regulatory oversight by the agency. Although to date the CFTC has not enacted regulations governing non-derivative or non-financed, margined
+or leveraged transactions in bitcoin, it has authority to commence enforcement actions against persons who violate certain prohibitions
+under the CEA related to transactions in any contract of sale of any commodity, including bitcoin, in interstate commerce (e.g., manipulation
+and engaging in certain deceptive practices).
+
+ 
+
+We cannot be certain as to how future regulatory
+developments will impact the treatment of bitcoin under the law. Any requirements imposed by the CFTC related to our mining activities
+or our transactions in bitcoin could cause us to incur additional extraordinary, non-recurring expenses, thereby potentially materially
+and adversely impacting an investment in us.
+
+ 
+
+Moreover, if our mining activities or transactions
+in bitcoin were deemed by the CFTC to constitute a collective investment in derivatives for our stockholders, we may be required to register
+as a commodity pool operator with the CFTC through the National Futures Association. Such additional registrations may result in extraordinary,
+non-recurring expenses, thereby potentially materially and adversely impacting an investment in us. If we determine not to comply with
+such additional regulatory and registration requirements, we may seek to cease certain of our operations. Any such action may adversely
+affect an investment in us.
+
+ 
+
+While no provision of the CEA or CFTC rules, orders
+or rulings (except as noted herein) appear to be currently applicable to our business, this is subject to change.
+
+ 
+
+It may be illegal now, or in the future, to mine, acquire, own,
+hold, sell or use bitcoin or other cryptocurrencies, participate in blockchains or utilize similar cryptocurrency assets in one or more
+countries.
+
+ 
+
+Although currently cryptocurrencies generally are
+not regulated or are lightly regulated in most countries, several countries, such as China, India and Russia, may continue taking regulatory
+actions in the future that could severely restrict the right to mine, acquire, own, hold, sell or use cryptocurrency assets or to exchange
+any such cryptocurrency assets for local currency. For example, in China and Russia (India is currently proposing new legislation), it
+is illegal to accept payment in bitcoin and other cryptocurrencies for consumer transactions and banking institutions are barred from
+accepting deposits of cryptocurrencies. In addition, in March 2021, the governmental authorities for the Chinese province of Inner Mongolia
+banned bitcoin mining in the province due to the industry s intense electrical power demands and its negative environmental impacts.
+Later, China extended the ban on bitcoin mining to all of China. If other countries, including the U.S., implement similar restrictions,
+such restrictions may adversely affect us. For example, in New York State, a moratorium on certain bitcoin mining operations that run
+on carbon-based power sources was signed into law on November 22, 2022. Such circumstances could have a material adverse effect on us,
+which could have a material adverse effect on our business, prospects or operations and potentially the value of any bitcoin or other
+cryptocurrencies we mine or otherwise acquire or hold for our own account, and thus harm investors.
+
+ 
+
+ 
+
+ 
+
+ 37 
+
+ 
+
+ 
+
+ 
+
+Changing environmental regulation and public energy policy may
+expose our business to new risks.
+
+ 
+
+Our bitcoin mining operations require a substantial
+amount of power and can only be successful, and ultimately profitable, if the costs we incur, including for electricity, are lower than
+the revenue we generate from our operations. As a result, any mine we establish can only be successful if we can obtain sufficient electrical
+power for that mine on a cost-effective basis, and our establishment of new mines requires us to find locations where that is the case.
+For instance, our plans and strategic initiatives for expansion are based, in part, on our understanding of current environmental and
+energy regulations, policies and initiatives enacted by federal and state regulators. If new regulations are imposed, or if existing regulations
+are modified, the assumptions we made underlying our plans and strategic initiatives may be inaccurate, and we may incur additional costs
+to adapt our planned business, if we are able to adapt at all, to such regulations.
+
+ 
+
+In addition, there continues to be a lack of consistent
+climate legislation, which creates economic and regulatory uncertainty for our business because the bitcoin mining industry, with its
+high energy demand, may become a target for future environmental and energy regulation. New legislation and increased regulation regarding
+climate change could impose significant costs on us and our suppliers, including costs related to increased renewable energy requirements,
+capital equipment, environmental monitoring and reporting, and other costs to comply with such regulations. Further, any future climate
+change regulations could also negatively impact our ability to compete with companies situated in areas not subject to such limitations.
+For example, the recently passed legislation in the state of New York imposing a moratorium on certain bitcoin mining operations that
+run carbon-based power.
+
+ 
+
+Given the political significance and uncertainty
+around the impact of climate change and how it should be addressed, we cannot predict how legislation and regulation will affect our financial
+condition and results of operations. Further, even without such regulation, increased awareness and any adverse publicity in the global
+marketplace about potential impacts on climate change by us or other companies in our industry could harm our reputation. Any of the foregoing
+could result in a material adverse effect on our business and financial condition.
+
+ 
+
+Future developments regarding the treatment of digital assets
+for U.S. federal income and applicable state, local and non-U.S. tax purposes could adversely impact our business.
+
+ 
+
+Due to the new and evolving nature of digital assets
+and the absence of comprehensive legal guidance with respect to digital assets and related transactions, many significant aspects of the
+U.S. federal income and applicable state, local and non-U.S. tax treatment of transactions involving digital assets, such as the purchase
+and sale of bitcoin and the receipt of staking rewards and other digital asset incentives and rewards products, are uncertain, and it
+is unclear what guidance may be issued in the future with respect to the tax treatment of digital assets and related transactions.
+
+ 
+
+Current Internal Revenue Service ("IRS")
+guidance indicates that for U.S. federal income tax purposes digital assets such as bitcoins should be treated and taxed as property,
+and that transactions involving the payment of bitcoins for goods and services should be treated in effect as barter transactions. The
+IRS has also released guidance to the effect that, under certain circumstances, hard forks of digital currencies are taxable events giving
+rise to taxable income and guidance with respect to the determination of the tax basis of digital currency. However, current IRS guidance
+does not address other significant aspects of the U.S. federal income tax treatment of digital assets and related transactions. Moreover,
+although current IRS guidance addresses the treatment of certain forks, there continues to be uncertainty with respect to the timing and
+amount of income inclusions for various digital asset transactions, including, but not limited to, staking rewards and other digital asset
+incentives and rewards products. While current IRS guidance creates a potential tax reporting requirement for any circumstance where the
+ownership of a bitcoin passes from one person to another, it preserves the right to apply capital gains treatment to those transactions.
+
+ 
+
+There can be no assurance that the IRS will not
+alter its existing position with respect to digital assets in the future or that other state, local and non-U.S. taxing authorities or
+courts will follow the approach of the IRS with respect to the treatment of digital assets such as bitcoin for income tax and sales tax
+purposes. Any such alteration of existing guidance or issuance of new or different guidance may have negative consequences including the
+imposition of a greater tax burden on investors in bitcoin or imposing a greater cost on the acquisition and disposition of bitcoin, generally,
+and potentially have a negative effect on the trading price of bitcoin or otherwise negatively impact our business. In addition, future
+technological and operational developments that may arise with respect to digital currencies may increase the uncertainty with respect
+to the treatment of digital currencies for U.S. federal income and applicable state, local and non-U.S. tax purposes.
+
+ 
+
+ 
+
+ 
+
+ 38 
+
+ 
+
+ 
+
+ 
+
+Our bitcoin holdings could subject us to regulatory scrutiny.
+
+ 
+
+As digital assets, including bitcoin, have grown
+in popularity and market size, there has been increasing focus on the extent to which digital assets can be used to launder the proceeds
+of illegal activities or fund criminal or terrorist activities, or entities subject to sanctions regimes. If we are found to have purchased
+any of our bitcoin from bad actors that have used bitcoin to launder money or persons subject to sanctions, we may be subject to regulatory
+proceedings and further transactions or dealings in bitcoin may be restricted or prohibited.
+
+ 
+
+Due to the unregulated nature and lack of transparency surrounding
+the operations of many bitcoin trading venues, they may experience fraud, security failures or operational problems, which may adversely
+affect the value of our bitcoin.
+
+ 
+
+Bitcoin trading venues are relatively new and,
+in some cases, unregulated. Furthermore, there are many bitcoin trading venues which do not provide the public with significant information
+regarding their ownership structure, management teams, corporate practices and regulatory compliance. As a result, the marketplace may
+lose confidence in bitcoin trading venues, including prominent exchanges that handle a significant volume of bitcoin trading.
+
+ 
+
+Negative perception, a lack of stability in the
+broader bitcoin markets and the closure or temporary shutdown of bitcoin trading venues due to fraud, business failure, hackers or malware,
+or government-mandated regulation may reduce confidence in bitcoin and result in greater volatility in the prices of bitcoin. To the extent
+investors view our common stock as linked to the value of our bitcoin holdings, such a negative perception of bitcoin trading venues could
+have a material adverse effect on the market value of our common stock.
+
+ 
+
+Our interactions with the bitcoin network may expose us to SDN
+or blocked persons or cause us to violate provisions of law that did not contemplate distributed ledger technology.
+
+ 
+
+The Office of Financial Assets Control ( OFAC )
+of the Treasury requires us to comply with its sanction program and not conduct business with persons named on its specially designated
+nationals ( SDN ) list. However, because of the pseudonymous nature of blockchain transactions, we may inadvertently and without
+our knowledge engage in transactions with persons named on OFAC s SDN list. We also may not be adequately capable of determining
+the ultimate identity of the persons with whom we transact.
+
+ 
+
+We have operations in Trinidad and may commence operations in
+other foreign countries. Foreign countries have differing degrees of political, legal and fiscal stability. This exposes us to a wide
+range of political developments that could result in changes to contractual terms, laws and regulations. In addition, we, and our joint
+arrangements and associates, face the risk of litigation and disputes worldwide.
+
+ 
+
+Developments in politics, laws and regulations
+of foreign countries can and do affect our operations. Potential impacts include:
+
+ 
+
+ 
+ 
+ forced divestment of assets;
+
+ 
+ 
+ 
+
+ 
+ 
+ expropriation of property;
+
+ 
+ 
+ 
+
+ 
+ 
+ cancellation or forced renegotiation of contract rights;
+
+ 
+ 
+ 
+
+ 
+ 
+ additional taxes including windfall taxes;
+
+ 
+ 
+ 
+
+ 
+ 
+ restrictions on deductions and retroactive tax claims;
+
+ 
+
+ 
+
+ 
+
+ 39 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ antitrust claims;
+
+ 
+ 
+ 
+
+ 
+ 
+ changes to trade compliance regulations;
+
+ 
+ 
+ 
+
+ 
+ 
+ price controls;
+
+ 
+ 
+ 
+
+ 
+ 
+ local content requirements;
+
+ 
+ 
+ 
+
+ 
+ 
+ foreign exchange controls;
+
+ 
+ 
+ 
+
+ 
+ 
+ changes to environmental regulations;
+
+ 
+ 
+ 
+
+ 
+ 
+ changes to regulatory interpretations and enforcement; and
+
+ 
+ 
+ 
+
+ 
+ 
+ changes to disclosure requirements.
+
+ 
+ 
+
+Any of these, individually or in aggregate, could
+have a material adverse effect on our earnings, cash flows and financial condition.
+
+ 
+
+From time to time, social and political factors
+play a role in unprecedented and unanticipated judicial outcomes that could adversely affect our business. Non-compliance with policies
+and regulations could result in regulatory investigations, litigation and, ultimately, sanctions. Certain governments and regulatory bodies
+have, in our opinion, exceeded their constitutional authority by:
+
+ 
+
+ 
+ 
+ attempting unilaterally to amend or cancel existing agreements or arrangements;
+
+ 
+ 
+ 
+
+ 
+ 
+ failing to honor existing contractual commitments; and
+
+ 
+ 
+ 
+
+ 
+ 
+ seeking to adjudicate disputes between private litigants.
+
+ 
+ 
+
+Additionally, certain governments have adopted
+laws and regulations that could potentially force us to violate other countries laws and regulations, therefore potentially subjecting
+us to both criminal and civil sanctions. Such developments and outcomes could have a material adverse effect on our earnings, cash flows
+and financial condition.
+
+ 
+
+Risks Related to Ownership of Our Common Stock
+
+ 
+
+An active trading market for our common stock may never develop
+or be sustained.
+
+ 
+
+Prior to this offering, our common stock is
+quoted on the OTCQX under the symbol BMNRD. We have applied to list our common stock on the NYSE American, and this offering
+is contingent upon the approval of such listing. However, we cannot predict the extent to which investor interest in our company will
+lead to the development of an active trading market in our common stock or how liquid that market might become. If such a market does
+not develop or is not sustained, it may be difficult for you to sell your shares of common stock at the time you wish to sell them, at
+a price that is attractive to you, or at all.
+
+ 
+
+ 
+
+ 40 
+
+ 
+
+ 
+
+ 
+
+The trading price of our common stock may be volatile, and you
+could lose all or part of your investment.
+
+ 
+
+The trading price of our common stock has been
+and is likely to continue to be volatile and could be subject to fluctuations in response to various factors, some of which are beyond
+our control. These fluctuations could cause you to lose all or part of your investment in our common stock as you might be unable to sell
+your shares at or above the price you paid for those shares. Factors that could cause fluctuations in the trading price of our common
+stock include the following:
+
+ 
+
+ 
+ 
+ 
+ price and volume fluctuations in the overall stock market from time to time;
+
+ 
+ 
+ 
+ volatility in the trading prices and trading volumes of technology stocks;
+
+ 
+ 
+ 
+ volatility in the price of bitcoin and other digital assets;
+
+ 
+ 
+ 
+ changes in operating performance and stock market valuations of other technology companies generally, or those in our industry in particular;
+
+ 
+ 
+ 
+ sales of shares of our common stock by us or our stockholders;
+
+ 
+ 
+ 
+ failure of securities analysts to maintain coverage of us, changes in financial estimates by securities analysts who follow our company, or our failure to meet these estimates or the expectations of investors;
+
+ 
+ 
+ 
+ the financial projections we may provide to the public, any changes in those projections, or our failure to meet those projections;
+
+ 
+ 
+ 
+ announcements by us or our competitors of new products, features, or services;
+
+ 
+ 
+ 
+ the public s reaction to our press releases, other public announcements and filings with the SEC;
+
+ 
+ 
+ 
+ rumors and market speculation involving us or other companies in our industry;
+
+ 
+ 
+ 
+ actual or anticipated changes in our results of operations or fluctuations in our results of operations;
+
+ 
+ 
+ 
+ actual or anticipated developments in our business, our competitors businesses or the competitive landscape generally;
+
+ 
+ 
+ 
+ litigation involving us, our industry, or both, or investigations by regulators into our operations or those of our competitors;
+
+ 
+ 
+ 
+ developments or disputes concerning our intellectual property or other proprietary rights;
+
+ 
+ 
+ 
+ announced or completed acquisitions of businesses, products, services or technologies by us or our competitors;
+
+ 
+ 
+ 
+ new laws or regulations or new interpretations of existing laws or regulations applicable to our business;
+
+ 
+ 
+ 
+ changes in accounting standards, policies, guidelines, interpretations or principles;
+
+ 
+ 
+ 
+ any significant change in our management; and
+
+ 
+ 
+ 
+ general economic conditions and slow or negative growth of our markets.
+
+ 
+ 
+
+In addition, in the past, following periods of
+volatility in the overall market and in the market price of a particular company s securities, securities class action litigation
+has often been instituted against these companies. This litigation, if instituted against us, could result in substantial costs and a
+diversion of our management s attention and resources.
+
+ 
+
+The concentration of our capital stock ownership with our
+management will likely limit your ability to influence corporate matters.
+
+ 
+As
+ of the date of this prospectus, our executive officers, directors, and affiliated persons
+ and entities collectively, beneficially owned approximately 52.2% of our outstanding common
+ stock and 100% of our Series A Convertible Preferred Stock and Series B Convertible Preferred
+ Stock (both series of which will be converted into common stock upon closing of this offering,
+ (see Certain Relationships and Related Party Transactions Letter Agreement with
+ Jonathan Bates and IDI )), and as a result control 74.4% of the votes on any matter
+ submitted to a vote of shareholders prior to the issuance of any shares in this offering.
+ Following this offering, our executive officers, directors, and affiliated persons and entities
+ will, collectively, beneficially own approximately 50.8% of our outstanding common stock
+ (or 48.5% of our outstanding common stock if the underwriters exercise their option to purchase
+ our shares in full pursuant to the overallotment option). As a result, while we do not expect
+ to be a controlled company within the meaning of the corporate governance rules
+ of the NYSE American on which we intend to list our shares, these persons and entities have
+ the ability to exercise significant influence over most matters that require approval by
+ our stockholders, including the election of directors and approval of significant corporate
+ transactions. This concentration of ownership might also have the effect of delaying or preventing
+ a change in control of our company or another significant corporate transaction that other
+ stockholders may view as beneficial.
+
+ 
+
+ 
+
+ 
+
+ 41 
+
+ 
+
+ 
+
+ 
+
+We have the right to designate and issue additional shares of
+preferred stock. If we were to designate and/or issue additional preferred stock, it is likely to have rights, preferences and privileges
+that may adversely affect the common stock.
+
+ 
+
+We are authorized to issue 20,000,000 shares of
+blank-check preferred stock, with such rights, preferences and privileges as may be determined from time to time by our Board of Directors.
+Our Board of Directors is empowered, without stockholder approval, to issue preferred stock in one or more series, and to fix for any
+series the dividend rights, dissolution or liquidation preferences, redemption prices, conversion rights, voting rights and other rights,
+preferences and privileges for the preferred stock.
+
+ 
+
+Currently, our Board of Directors has designated
+500,000 shares as Series A Convertible Preferred Stock, of which 453,966 shares are outstanding, and 3,000 shares as Series B Convertible
+Preferred Stock, of which 2,500 shares are outstanding. The Series A Convertible Preferred Stock has a stated value of $10 per share and
+the Series B Convertible Preferred Stock has a stated value of $1,000 per share. Each of the series of preferred stock has a liquidation
+value senior to common stock an amount equal to their stated value, are convertible into common stock at a conversion price of $0.20 per
+share (pre-split), are entitled to dividends on an as-converted basis and to vote on an as-converted basis, grant the holders certain
+rights to compel a mandatory redemption of the shares, to participate in future offerings as well as anti-dilution protection, among other
+provisions.
+
+ 
+
+The issuance of shares of preferred stock, depending
+on the rights, preferences and privileges attributable to the preferred stock, could reduce the voting rights and powers of our common
+stock and the portion of our assets allocated for distribution to common stockholders in a liquidation event, and could also result in
+dilution in the book value per share of our common stock. The preferred stock could also be utilized, under certain circumstances, as
+a method for raising additional capital or discouraging, delaying or preventing a change in control of us, to the detriment of the investors
+in our common stock. We cannot assure that we will not, under certain circumstances, issue additional shares of our preferred stock.
+
+ 
+
+We incur significant costs and demands upon management and accounting
+and finance resources as a result of complying with the laws and regulations affecting public companies; any failure to establish and
+maintain adequate internal controls and/or disclosure controls or to recruit, train and retain necessary accounting and finance personnel
+could have an adverse effect on our ability to accurately and timely prepare our financial statements and otherwise make timely and accurate
+public disclosure.
+
+ 
+
+As a public company quoted in the United States,
+we will incur significant additional legal, accounting and other expenses. In addition, changing laws, regulations and standards relating
+to corporate governance and public disclosure, including regulations implemented by the SEC and any exchange on which we list our shares,
+may increase legal and financial compliance costs and make some activities more time consuming. These laws, regulations and standards
+are subject to varying interpretations, and as a result, their application in practice may evolve over time as new guidance is provided
+by regulatory and governing bodies. We intend to invest resources to comply with evolving laws, regulations and standards, and this investment
+may result in increased general and administrative expenses and a diversion of management s time and attention from revenue-generating
+activities to compliance activities. If, notwithstanding our efforts, we fail to comply with new laws, regulations and standards, regulatory
+authorities may initiate legal proceedings against us, and our business may be harmed.
+
+ 
+
+In particular, we have needed, and continue to
+need, to enhance and supplement our internal accounting resources with additional accounting and finance personnel with the requisite
+technical and public company experience and expertise to enable us to satisfy such reporting obligations. Failure to comply with these
+rules might also make it more difficult for us to obtain certain types of insurance, including director and officer liability insurance,
+and we might be forced to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar
+coverage. The impact of these events would also make it more difficult for us to attract and retain qualified persons to serve on our
+board of directors, on committees of our board of directors or as members of senior management.
+
+ 
+
+ 
+
+ 
+
+ 42 
+
+ 
+
+ 
+
+ 
+
+Section 404 of the Sarbanes-Oxley Act of 2002 requires
+that we evaluate and report on our system of internal controls and, if and when we are no longer a smaller reporting company, 
+will require that we have such a system of internal controls audited. If we fail to maintain the adequacy of our internal controls, we
+could be subject to regulatory scrutiny, civil or criminal penalties and/or stockholder litigation. Any inability to provide reliable
+financial reports could harm our business. Furthermore, any failure to implement required new or improved controls, or difficulties encountered
+in the implementation of adequate controls over our financial processes and reporting in the future, could harm our operating results
+or cause us to fail to meet our reporting obligations. Inferior internal controls could also cause investors to lose confidence in our
+reported financial information, which could have a negative effect on the trading price of our securities. 
+
+ 
+
+As a smaller reporting company we will be
+exempt from certain disclosure requirements, which could make our common stock less attractive to potential investors.
+
+ 
+
+Rule 12b-2 of the Exchange
+Act defines a smaller reporting company as an issuer that is not an investment company, an asset-backed issuer, or a majority-owned
+subsidiary of a parent that is not a smaller reporting company and that:
+
+ 
+
+ had a public float of less than $250 million
+as of the last business day of its most recently completed second fiscal quarter, computed by multiplying the aggregate worldwide number
+of shares of its voting and non-voting common equity held by non-affiliates by the price at which the common equity was last sold, or
+the average of the bid and asked prices of common equity, in the principal market for the common equity
+
+ in the case of an initial registration statement
+under the Securities Act, or the Exchange Act of 1934, as amended, which we refer to as the Exchange Act, for shares of its common equity,
+had a public float of less than $250 million as of a date within 30 days of the date of the filing of the registration statement, computed
+by multiplying the aggregate worldwide number of such shares held by non-affiliates before the registration plus, in the case of a Securities
+Act registration statement, the number of such shares included in the registration statement by the estimated public offering price of
+the shares; or
+
+ in the case of an issuer whose public float as
+calculated under paragraph (1) or (2) of this definition was zero or whose public float was less than $700 million, had annual revenues
+of less than $100 million during the most recently completed fiscal year for which audited financial statements are available
+
+ 
+
+As a smaller reporting company,
+we are not required and may not include a Compensation Discussion and Analysis section in our proxy statements, and we will provide only
+two years of financial statements. We also have other scaled disclosure requirements that are less comprehensive than issuers
+that are not smaller reporting companies which could make our common stock less attractive to potential investors, which could make it
+more difficult for our stockholders to sell their shares.
+
+ 
+
+We are an emerging growth company, 
+and we cannot be certain if the reduced reporting and disclosure requirements applicable to emerging growth companies will make our common
+stock less attractive to investors.
+
+ 
+
+We qualify as an emerging
+growth company under the JOBS Act. As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure
+requirements. For so long as we are an emerging growth company, we will not be required to:
+
+ 
+
+ have an auditor report on our internal control
+over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;
+
+ comply with any requirement that may be adopted
+by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditors report
+providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis);
+
+ submit certain executive compensation matters
+to stockholder advisory votes, such as say-on-pay and say-on-frequency ; and
+
+ disclose certain executive compensation related
+items such as the correlation between executive compensation and performance and comparisons of the chief executive officer s compensation
+to median employee compensation.
+
+ 
+
+ 
+
+ 
+
+ 43 
+
+ 
+
+ 
+
+ 
+
+In addition, Section 102 of
+the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B)
+of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the
+adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage
+of the benefits of this extended transition period. Our financial statements may therefore not be comparable to those of companies that
+comply with such new or revised accounting standards.
+
+ 
+
+We will remain an emerging
+growth company until the earliest to occur of: (i) the end of the first fiscal year in which our annual gross revenue is $1.235 billion
+or more; (ii) the end of the fiscal year in which the market value of our common shares that are held by non-affiliates is at least $700.0
+million as of the last business day of our most recently completed second fiscal quarter; (iii) the date on which we have, during the
+previous three-year period, issued more than $1.0 billion in non-convertible debt; and (iv) the end of the fiscal year during which the
+fifth anniversary of this offering occurs.
+
+ 
+
+Because there has been limited precedent set for financial accounting
+of bitcoin and other cryptocurrency assets, the determination that we have made for how to account for cryptocurrency assets transactions
+may be subject to change.
+
+ 
+
+Because there has been limited precedent set for
+the financial accounting of cryptocurrencies and related revenue recognition, it is unclear how companies may, in the future, be required
+to account for cryptocurrency transactions and assets and related revenue recognition. A change in regulatory or financial accounting
+standards could result in the necessity to change our accounting methods and restate our financial statements. Such a restatement could
+adversely affect the accounting for our newly mined cryptocurrency rewards and more generally negatively impact our business, prospects,
+financial condition and results of operations. Such circumstances would have a material adverse effect on our ability to continue as a
+going concern or to pursue our new strategy at all, which would have a material adverse effect on our business, prospects or operations
+as well as and potentially the value of any cryptocurrencies we hold or expect to acquire for our own account and harm our investors.
+
+ 
+
+Exercise or conversion of warrants and other convertible securities,
+along with new issuances of our common stock, will dilute our stockholder s percentage of ownership.
+
+ 
+
+We have issued convertible securities and warrants
+to purchase shares of our common stock to our officers and certain investors. In the future, we may grant additional warrants and convertible
+securities. In particular, we have issued to our Chief Executive Officer and Innovative Digital Investors Emerging Technology, L.P. ( IDI ),
+an entity over which our CEO exercises voting power and control, an aggregate of 453,996 shares of Series A Convertible Preferred Stock,
+which are convertible into 1,134,915 shares of common stock (on a post-split basis), and 2,500 shares of Series B Convertible Preferred
+Stock, which are convertible into 625,000 shares of common stock (on a post-split basis), for a total of 1,759,915 shares of common stock
+(on a post-split basis). (See Principal Stockholders. ) The holders of our outstanding preferred stock
+have agreed to convert such preferred stock into shares of common stock in connection with the consummation of this offering. (See Certain
+Relationships and Related Party Transactions Letter Agreement with Jonathan Bates and IDI. ) The exercise, conversion or
+exchange of any currently outstanding or future issued options, warrants or convertible securities, including for other securities, will
+substantially dilute the percentage ownership of our common stockholders. The dilutive effect of the exercise or conversion of these
+securities may adversely affect our ability to obtain additional capital. The holders of these securities may be expected to exercise
+or convert such warrants and convertible securities at a time when it would be able to obtain additional equity capital on terms more
+favorable than such securities or when our common stock is trading at a price higher than the exercise or conversion price of the securities.
+The exercise or conversion of outstanding warrants and convertible securities will have a dilutive effect on the securities held by our
+stockholders. We have in the past, and may in the future, exchange outstanding securities for other securities on terms that are dilutive
+to the securities held by other stockholders not participating in such exchange. 
+
+ 
+
+ 
+
+ 
+
+ 44 
+
+ 
+
+ 
+
+ 
+
+A significant portion of our assets are pledged to an entity
+controlled by our Chairman and failure to repay obligations to such entity when due could result in foreclosure on our assets.
+
+ 
+As
+ of February 28, 2025, we owed $1,875,000 in principal, plus interest, to an investment fund
+ controlled by our Chairman under a line of credit that permits draws by us of up to $2,300,000.
+ As of the date of this prospectus, we had not made any payment of principal or accrued interest
+ on the loan since its inception, and, as a result, the current outstanding principal and
+ amount of accrued interest represents the largest aggregate amount outstanding since the
+ date of the loan agreement. At maturity on December 1, 2024, the amount due under the line
+ of credit along with accrued interest was payable in full. However, we have the right to
+ extend the maturity for six monthly periods in consideration for $25,000 for each extension,
+ which will be added to the loan balance. We exercised our right to extend the maturity date
+ of the loan; however, the $25,000 extension fee was never accrued or paid. Consequently,
+ we executed an amendment on May 21, 2025, pursuant to which the extension fee was waived
+ and replaced with a payment of $150,000, payable by June 6, 2025, to the extent we do not
+ complete our public offering. Pursuant to the amendment, the maturity date was also extended
+ to August 15, 2025. Amounts due under the line of credit are secured by our assets.
+
+ 
+
+It is necessary for us to grow our business in
+order to generate free cash flow necessary to repay the principal and interest on our indebtedness. If we were to default on the amounts
+owed or other terms and conditions of the convertible notes, the lender would have the right to exercise rights and remedies to collect,
+which would include obtaining judgement lien on our assets and selling them to pay the judgment. A default would have a material adverse
+effect on our business and our stockholders could lose their entire investment in us. We may need to raise capital in order to repay our
+amounts due under the line of credit at maturity. There is no assurance that we will be able to raise such capital on terms that will
+be favorable to common stockholders.
+
+ 
+
+We may need capital in the future, and we
+may not be able to raise that capital on favorable terms.
+
+ 
+
+Developing our business will require significant
+capital in the future. Historically, we have partially relied on financial support from insiders, including the under a line of credit
+with an entity controlled by our Chairman that permits draws by us of up to $2,300,000. After the completion of this offering, we do not
+expect to receive any additional capital contributions from insiders. To meet our capital needs, we expect to rely on cash flows from
+operations, the proceeds from this offering, future offerings and other third-party financing. Third-party financing in the future may
+not, however, be available on terms favorable to us, or at all. Our ability to obtain additional funding will be subject to various factors,
+including market conditions, our operating performance, lender sentiment and our ability to incur additional debt in compliance with other
+contractual restrictions such as financial covenants under term loans or other debt documents. These factors may make the timing, amount,
+or terms and conditions of additional financing unattractive. Our inability to raise capital could impede our growth and could materially
+adversely affect our business, financial condition or results of operations.
+
+ 
+
+We depend on key personnel and could be harmed by the loss of
+their services because of the limited number of qualified people in our industry.
+
+ 
+
+Because of our small size, we require the continued
+service and performance of our management team, all of whom we consider to be key employees. Competition for highly qualified employees
+in the data storage industry is intense. Our success will depend to a significant degree upon our ability to attract, train, and retain
+highly skilled directors, officers, management, business, financial, legal, marketing, sales, and technical personnel and upon the continued
+contributions of such people. In addition, we may not be able to retain our current key employees. The loss of the services of one or
+more of our key personnel and our failure to attract additional highly qualified personnel could impair our ability to expand our operations
+and provide service to our customers.
+
+ 
+
+We currently do not have employment agreements
+with most of our management and are not currently paying them any compensation. As a result, management s only incentive for continuing
+to work for us is due to their stock ownership in us. Our management will not be able to work for us indefinitely without being paid.
+We plan to enter into employment contracts with management, and begin paying them compensation, once we are able to raise capital to fund
+our business.
+
+ 
+
+Competition for employees is intense, and we may not be able
+to attract and retain the qualified and skilled employees needed to support our business.
+
+ 
+
+We believe our success depends on the efforts and
+talent of our employees, including hosting facility design, construction management, operations, data processing, engineering, IT, risk
+management and sales and marketing personnel. Our future success depends on our continued ability to attract, develop, motivate and retain
+qualified and skilled employees. Competition for highly skilled personnel is extremely intense. We may not be able to hire and retain
+these personnel at compensation levels consistent with our existing compensation and salary structure. Some of the companies with which
+we compete for experienced employees have greater resources than we have and may be able to offer more attractive terms of employment.
+
+ 
+
+ 
+
+ 
+
+ 45 
+
+ 
+
+ 
+
+ 
+
+In addition, if we fail to retain our employees,
+we could incur significant expenses in hiring and training their replacements, and the quality of our services and our ability to serve
+our customers could diminish, resulting in a material adverse effect on our business, financial condition and results of operations. At
+this time, we lack the resources to hire all of the skilled employees that we need to properly operate our business.
+
+ 
+
+Our common stock market price and trading volume could decline
+if securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business.
+
+ 
+
+The trading market for our common stock may depend
+in part on the research and reports that securities or industry analysts publish about us or our business. Currently, no analysts cover
+our common stock. A failure to obtain analyst coverage of our common stock may mean that our price may never achieve levels that we think
+are fair and that our trading volume never achieves levels that are sufficient to attract additional investor interest.
+
+ 
+
+Even if one or more analysts begin to cover our
+common stock, analysts estimates are based upon their own opinions and are often different from the estimates or expectations of
+management. Analysts could downgrade our common stock or publish inaccurate or unfavorable research about our business, which would likely
+cause the price of our securities to decline. If few securities analysts commence coverage of us, or if one or more of these analysts
+cease coverage of us or fail to publish reports on us regularly, demand for our securities could decrease, which might cause the price
+and trading volume of our common stock to decline.
+
+ 
+
+An inability to obtain analyst coverage for our
+common stock, and expected gains in our stock price and trading volume, will impair our ability to raise capital to finance the growth
+of our business, which could have a material adverse effect on our business and stock price.
+
+ 
+
+Our amended and restated certificate of incorporation and amended
+and restated bylaws provide that state or federal court located within the state of Delaware will be the sole and exclusive forum for
+substantially all disputes between us and our shareholders, which could limit its stockholders ability to obtain a favorable judicial
+forum for disputes with us or our directors, officers or other employees.
+
+ 
+
+Our amended and restated certificate of incorporation
+provides that [u]nless the Corporation consents in writing to the selection of an alternative forum, the Court of Chancery of the
+State of Delaware (the Court of Chancery ) shall be the sole and exclusive forum for any stockholder (including a beneficial
+owner) to bring (a) any derivative action or proceeding brought on behalf of the Corporation, (b) any action asserting a claim of breach
+of a fiduciary duty owed by any director, officer or other employee of the Corporation to the Corporation or the Corporation s stockholders,
+(c) any action asserting a claim against the Corporation, its directors, officers or employees arising pursuant to any provision of the
+DGCL or this Amended and Restated Certificate or the Bylaws or (d) any action asserting a claim against the Corporation, its directors,
+officers or employees governed by the internal affairs doctrine, except for, as to each of (a) through (d) above, any claim arising under
+the Securities Act of 1933, as amended, or the Exchange Act, any claim as to which the Court of Chancery determines that there is an indispensable
+party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction
+of the Court of Chancery within ten days following such determination), which is vested in the exclusive jurisdiction of a court or forum
+other than the Court of Chancery, or for which the Court of Chancery does not have subject matter jurisdiction, in which case, any such
+claim shall be brought in any other court located in the State of Delaware possessing subject matter jurisdiction. 
+
+ 
+
+This exclusive forum provision may limit a shareholder s
+ability to bring a claim in a judicial forum of its choosing for disputes with us or our directors, officers or other employees, which
+may discourage lawsuits against us or our directors, officers or other employees. In addition, shareholders who do bring a claim in the
+state or federal court in the State of Delaware could face additional litigation costs in pursuing any such claim, particularly if they
+do not reside in or near Delaware. The state or federal court of the State of Delaware may also reach different judgments or results than
+would other courts, including courts where a shareholder would otherwise choose to bring the action, and such judgments or results may
+be more favorable to us than to our shareholders. However, the enforceability of similar exclusive forum provisions in other companies 
+certificates of incorporation have been challenged in legal proceedings, and it is possible that a court could find this type of provision
+to be inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings. If a court were to
+find the exclusive forum provision contained in our amended and restated certificate of incorporation and our bylaws to be inapplicable
+or unenforceable in an action, we might incur additional costs associated with resolving such action in other jurisdictions.
+
+ 
+
+ 
+
+ 
+
+ 46 
+
+ 
+
+ 
+
+ 
+
+Anti-takeover provisions contained in our amended and restated
+certificate of incorporation and amended and restated bylaws, as well as provisions of Delaware law, could impair a takeover attempt.
+
+ 
+
+Our amended and restated certificate
+of incorporation and amended and restated bylaws contain provisions that could have the effect of delaying or preventing changes in control
+or changes in our management without the consent of our board of directors. These provisions include:
+
+ 
+
+ 
+ 
+ 
+ no cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates;
+
+ 
+ 
+ 
+
+ 
+ 
+ the exclusive right of our board of directors to elect a director to fill a vacancy created by the expansion of the board of directors or the resignation, death, or removal of a director, which prevents stockholders from being able to fill vacancies on our board of directors;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the ability of our board of directors to determine whether to issue shares of our preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquirer;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ limiting the liability of, and providing indemnification to, our directors and officers;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ providing that a special meeting of the stockholders may only be called by the president or a majority of the board of directors;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ providing that the bylaws may be altered, amended or repealed by the board of directors by an affirmative vote of a majority of the board of directors at any regular meeting of the board of directors, or by the affirmative vote of at least 75% of the outstanding shares of capital stock entitled to vote on such amendment or repeal, voting together as a single class the board of directors does not recommend the amendment or repeal of the bylaws; and
+
+ 
+ 
+
+These provisions, alone or together, could delay
+hostile takeovers and changes in control of us or changes in our board of directors and management.
+
+ 
+
+Any provision of our amended and restated certificate
+of incorporation or amended and restated bylaws or Delaware law that has the effect of delaying or deterring a change in control could
+limit the opportunity for our security holders to receive a premium for their securities and could also affect the price that some investors
+are willing to pay for our securities.
+
+ 
+
+We will indemnify and hold harmless our officers and directors
+to the maximum extent permitted by Delaware law.
+
+ 
+
+Our certificate of incorporation, as amended in
+connection with the consummation of this offering, provides that we will indemnify and hold harmless our officers and directors against
+claims arising from our activities to the maximum extent permitted by Delaware law. If we were called upon to perform under our indemnification
+obligations, then the portion of our assets expended for such a purpose would reduce the amount otherwise available for our business.
+
+ 
+
+Risks Related to This Offering
+
+ 
+
+We have broad discretion in the use of our cash, cash equivalents
+and marketable securities, including the net proceeds from this offering, and may use them ineffectively, in ways with which you do not
+agree or in ways that do not increase the value of your investment.
+
+ 
+
+Our management will have broad discretion in the
+application of our cash, cash equivalents and marketable securities, including the net proceeds from this offering, and could spend the
+proceeds in ways that do not improve our results of operations. The failure by our management to apply these funds effectively could
+result in additional operating losses that could have a negative impact on our business, cause the price of our common stock to decline
+and delay the development of our bitcoin mining business. Pending their use, we may invest our cash, cash equivalents and marketable
+securities, including the net proceeds from this offering, in a manner that does not produce income or that loses value. (See Use of Proceeds. )
+
+ 
+
+ 
+
+ 
+
+ 47 
+
+ 
+
+ 
+
+ 
+
+If you purchase our securities in this offering, you will suffer
+immediate dilution of your investment.
+
+ 
+
+The public offering price of our common stock will
+be substantially higher than the pro forma as adjusted net tangible book value per share as of February 28, 2025. Therefore, if you purchase
+our common stock in this offering, you will pay a price per share of common stock that substantially exceeds our pro forma as adjusted
+net tangible book value per share immediately after this offering. Based on the assumed public offering price of $8.00 per share, and
+after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us, you will experience
+immediate dilution of approximately $5.06 per share, representing the difference between our pro forma as adjusted net tangible book
+value per share after this offering and the assumed public offering price per share. (See Dilution. )
+
+ 
+
+Our common stock is currently quoted on the OTCQX operated by
+OTC Markets Group, Inc. Our common stock will be listed on the NYSE American if this offering is consummated. If we are unable to maintain
+listing of our securities on the NYSE American or any stock exchange, our stock price could be adversely affected and the liquidity of
+our stock and our ability to obtain financing could be impaired and it may be more difficult for our stockholders to sell their securities.
+
+ 
+
+Although our common stock will be listed on the
+NYSE American immediately after this offering, we may not be able to continue to meet the exchange s minimum listing requirements
+or those of any other national exchange. If we are unable to maintain listing on the NYSE American or if a liquid market for our common
+stock does not develop or is sustained, our common stock may remain thinly traded.
+
+ 
+
+The listing rules of the NYSE American require
+listing issuers to comply with certain standards in order to remain listed on its exchange. If, for any reason, we should fail to maintain
+compliance with these listing standards and the NYSE American should delist our securities from trading on its exchange and we are unable
+to obtain listing on another national securities exchange, a reduction in some or all of the following may occur, each of which could
+have a material adverse effect on our stockholders:
+
+ 
+
+ 
+ 
+ 
+ the liquidity of our common stock;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the market price of our common stock;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our ability to obtain financing for the continuation of our operations;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the number of institutional and general investors that will consider investing in our common stock;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the number of investors in general that will consider investing in our common stock;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the number of market makers in our common stock;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the availability of information concerning the trading prices and volume of our common stock; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the number of broker-dealers willing to execute trades in shares of our common stock.
+
+ 
+ 
+
+ 
+
+ 
+
+ 48 
+
+ 
+
+ 
+
+ 
+
+Because we do not anticipate paying any cash dividends on our
+common stock in the foreseeable future, capital appreciation, if any, will be your sole source of gain.
+
+ 
+
+We have never declared or paid any cash dividends
+on our common stock. We currently anticipate that we will retain future earnings for the development, operation and expansion of our business
+and do not anticipate declaring or paying any cash dividends for the foreseeable future. As a result, capital appreciation, if any, of
+our common stock would be your sole source of gain on an investment in our common stock for the foreseeable future.
+
+ 
+
+The sale or availability for sale of substantial amounts of common
+stock could adversely affect their market price.
+
+ 
+
+We expect to raise capital to fund our business
+by issuing additional shares of common stock and/or securities convertible into common stock, and the sales of substantial amounts of
+the common stock in the public market after the completion of this offering, or the perception that these sales could occur, could adversely
+affect the market price of the common stock and could materially impair our ability to raise capital through equity offerings in the future.
+The common stock sold in this offering will be freely tradable without restriction or further registration under the Securities Act, and
+shares held by our existing shareholders may also be sold in the public market in the future subject to the restrictions in Rule 144 and
+Rule 701 under the Securities Act and the applicable lockup agreements. Future sales and issuances of our capital stock or rights to purchase
+our capital stock could result in substantial dilution to our existing stockholders. We may sell common stock, convertible securities
+and other equity securities in one or more transactions at prices and in a manner as we may determine from time to time. If we sell any
+such securities in subsequent transactions, investors may be materially diluted. New investors in such subsequent transactions could gain
+rights, preferences and privileges senior to those of holders of our common stock.
+
+ 
+
+There
+will be 5,785,170 shares of common stock outstanding immediately after this offering, or 6,066,420 shares of common stock if the
+underwriters exercise their option to purchase additional shares in full pursuant to the overallotment option. In connection with
+this offering, we, our directors and executive officers and the holders of 5% or more of our outstanding common stock have agreed
+with the underwriter, subject to certain exceptions, not to sell, transfer or dispose of, directly or indirectly, any of common
+stock or securities convertible into or exercisable or exchangeable for the common stock for a period of 180 days (or 90 days with
+respect to us and certain of the 5% or more stockholders) respect to after the date of this prospectus. These outstanding shares
+that are subject to lock-up agreements are expected to become eligible for unrestricted sale upon expiration of the lockup period,
+as described in the sections of this prospectus entitled Shares Eligible for Future Sale and
+ Underwriting. Sales of shares by these shareholders could have a material adverse effect on the
+trading price of our common stock.
+
+ 
+
+The underwriters of this offering may waive or release parties
+to the lock-up agreements entered into in connection with this offering, which could adversely affect the price of our common
+stock.
+
+ 
+
+We, our directors, executive officers and holders
+of 5% or more of our common stock have entered into lock-up agreements with respect to our and their respective shares of common
+stock. As restrictions on resale end, the market price of our common stock could decline if the holders of restricted shares sell them
+or are perceived by the market as intending to sell them. ThinkEquity, at any time and without notice, may release all or any portion
+of the shares of common stock subject to the foregoing lock-up agreements entered into in connection with this offering. If the restrictions
+under the lock-up agreements are waived, approximately 3,318,526 shares of common stock will be available for sale into the market, which
+could reduce the market value for our common stock. (See Shares Eligible for Future Sale and Underwriting. )
+
+ 
+
+ 
+
+ 
+
+ 49 
+
+ 
+
+ 
+
+ 
+
+If we are not able to comply with the applicable continued listing
+requirements or standards of the NYSE American, the NYSE American could delist our securities.
+
+ 
+
+We intend to apply to have our common stock listed
+on the NYSE American under the proposed symbol BMNR and we anticipate that our common stock will begin trading on the NYSE
+American immediately following the completion of this offering. The listing of our common stock on NYSE American or another securities
+exchange is a condition of this offering. Although, after giving effect to this offering we expect to meet the minimum initial listing
+standards set forth in the NYSE American Listing Standards, we cannot assure you that our securities will be, or will continue to be,
+listed on the NYSE American in the future. In order to maintain that listing, we must satisfy minimum financial and other continued listing
+requirements and standards, including those regarding director independence and independent committee requirements, minimum stockholders 
+equity, minimum share price, and certain corporate governance requirements. We may not be able to comply with the applicable listing
+standards and the NYSE American could delist our securities as a result.
+
+ 
+
+We cannot assure you that our common stock, if
+delisted from NYSE American, will be listed on another national securities exchange. If our common stock is delisted by the NYSE American,
+our common stock would likely trade on the OTC Markets where an investor may find it more difficult to sell our shares or obtain accurate
+quotations as to the market value of our common stock.
+
+ 
+
+Techniques employed
+by short sellers may drive down the market price of our common stock.
+
+ 
+
+Short selling is the practice of selling securities
+that the seller does not own but rather has borrowed from a third party with the intention of buying identical securities back at a later
+date to return to the lender. The short seller hopes to profit from a decline in the value of the securities between the sale of the borrowed
+securities and the purchase of the replacement shares, as the short seller expects to pay less in that purchase than it received in the
+sale.
+
+ 
+
+As it is in the short seller s interest for
+the price of the security to decline, many short sellers publish, or arrange for the publication of, negative opinions regarding the relevant
+issuer and its prospects to create negative market momentum and generate profits for themselves after selling a security short. These
+short attacks have, in the past, led to selling of shares in the market.
+
+ 
+
+It is not clear what effect such negative publicity
+could have on us. If we were to become the subject of any unfavorable allegations, whether such allegations are proven to be true or untrue,
+we could have to expend significant resources to investigate such allegations and/or defend ourselves.
+
+ 
+
+We may be constrained in the manner in which we
+can proceed against the relevant short seller by principles of freedom of speech, applicable state law or issues of commercial confidentiality.
+Such a situation could be costly and time-consuming, and could distract our management from growing our business. Even if such allegations
+are ultimately proven to be groundless, allegations against us could severely impact our business, and any investment in the common stock
+could be greatly reduced or even rendered worthless.
+
+ 
+
+We may be subject to securities litigation, which is expensive
+and could divert our management s attention.
+
+ 
+
+The market price of our securities may be volatile,
+and in the past companies that have experienced volatility in the market price of their securities have been subject to securities class
+action litigation. We may be the target of this type of litigation in the future. Securities litigation against us could result in substantial
+costs and divert our management s attention from other business concerns, which could seriously harm our business.
+
+ 
+
+ 
+
+ 
+
+ 50 
+
+ 
+
+ 
+
+ 
+
+Risks Related to the Reverse Stock Split
+
+ 
+
+The Reverse Stock Split may decrease the liquidity of the shares
+of our common stock.
+
+ 
+
+We effected the Reverse Stock Split on May 15,
+2025. The liquidity of the shares of our common stock may be affected adversely by the Reverse Stock Split given the reduced number of
+shares that are outstanding as a result of the Reverse Stock Split, especially if the market price of our common stock does not increase
+proportionally as a result of the Reverse Stock Split. In addition, the Reverse Stock Split may have increased the number of stockholders
+who own odd lots (less than 100 shares) of our common stock and such stockholders may experience an increase in the cost of selling their
+shares of common stock and greater difficulty effecting such sales.
+
+ 
+
+Following the Reverse Stock Split, the resulting market price
+of our common stock may not attract new investors, including institutional investors, and may not satisfy the investing requirements
+of those investors. Consequently, the trading liquidity of our common stock may not improve.
+
+ 
+
+Although we believe that a higher market price
+of our common stock may help generate greater or broader investor interest, there can be no assurance that the Reverse Stock Split will
+result in a share price that will attract new investors, including institutional investors. In addition, there can be no assurance that
+the market price of our common stock will satisfy the investing requirements of those investors. As a result, the trading liquidity of
+our common stock may not necessarily improve.
+
+ 
+
+Following the Reverse Stock Split, we cannot
+assure you that we will be able to continue to comply with listing standards of the NYSE American. 
+
+Following the Reverse Stock
+Split, we expect that our common stock will be eligible to be listed on the NYSE American. For our common stock to be so listed, we must
+meet the current listing standards of the NYSE American, including the minimum bid price requirement. There can be no assurance that
+the market price of our common stock following the Reverse Stock Split will remain at the level required for continuing compliance with
+the minimum bid price requirement of the NYSE American. It is not uncommon for the market price of a company s common stock to
+decline in the period following a Reverse Stock Split. If the market price of our common stock declines following the effectuation of
+the Reverse Stock Split, the percentage decline may be greater than would occur in the absence of a reverse stock split. In addition,
+other factors unrelated to the number of shares of our common stock outstanding, such as negative financial or operational results, could
+adversely affect the market price of our common stock and jeopardize our ability to meet or maintain the minimum bid price requirement
+of the NYSE American. If we fail to comply with the minimum bid price requirement, our securities could be delisted.
+
+If our shares of common stock
+were to be delisted from the NYSE American, our common stock could revert to trading on the OTC Markets. Any such delisting of our common
+stock could have an adverse effect on the market price of, and the efficiency of the trading market for, our common stock, not only in
+terms of the number of shares that can be bought and sold at a given price, but also through delays in the timing of transactions and
+less coverage of us by securities analysts, if any.
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 51 
+
+ 
+
+ 
+
+ 
+
+MARKET FOR COMMON STOCK AND PRICE RANGE OF
+COMMON STOCK
+
+ 
+
+Our common stock is quoted on the OTCQX, operated
+by OTC Markets, LLC, under the symbol, BMNRD. The OTCQX is a network of security dealers who buy and sell stock. The dealers
+are connected by a computer network that provides information on current bids and asks, as well as volume
+information.
+
+ 
+The
+ following post-split table retroactively applied sets forth trading information for our common
+ stock for the periods indicated, as quoted on the OTCQX. These quotations reflect inter-dealer
+ prices, without retail mark-up, mark-down or commission and may not necessarily represent
+ actual transactions.
+
+ 
+
+ 
+ 
+ 
+ Price Range
+ 
+
+ 
+ 
+ 
+ High
+ 
+ 
+ Low
+ 
+
+ 
+ Six months ended February 28, 2025
+ 
+ $
+ 11.60
+ 
+ 
+ $
+ 2.00
+ 
+
+ 
+ Year ended August 31, 2024
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ First Quarter
+ 
+ $
+ 17.20
+ 
+ 
+ $
+ 8.00
+ 
+
+ 
+ Second Quarter
+ 
+ $
+ 18.00
+ 
+ 
+ $
+ 9.80
+ 
+
+ 
+ Third Quarter
+ 
+ $
+ 17.60
+ 
+ 
+ $
+ 10.20
+ 
+
+ 
+ Fourth Quarter
+ 
+ $
+ 12.00
+ 
+ 
+ $
+ 8.80
+ 
+
+ 
+ Year ended August 31, 2023
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ First Quarter
+ 
+ $
+ 26.00
+ 
+ 
+ $
+ 14.00
+ 
+
+ 
+ Second Quarter
+ 
+ $
+ 24.00
+ 
+ 
+ $
+ 0.00
+ 
+
+ 
+ Third Quarter
+ 
+ $
+ 23.00
+ 
+ 
+ $
+ 9.00
+ 
+
+ 
+ Fourth Quarter
+ 
+ $
+ 63.80
+ 
+ 
+ $
+ 4.40
+ 
+
+ 
+
+ 
+
+*The over-the-counter market quotations of the
+bid prices reflect inter-dealer prices, without retail mark-up, markdown or commission, and may not necessarily represent actual transactions.
+
+ 
+
+Dividends
+
+ 
+
+We have never declared any dividends on our common
+stock and we do not anticipate paying any dividends on our common stock in the foreseeable future. We currently intend to retain all available
+funds and any future earnings to fund the development and growth of our business. Any future determination to declare dividends will be
+subject to the discretion of our Board of Directors and will depend on various factors, including applicable Delaware law, future earnings,
+capital requirements, results of operations and any other relevant factors. In general, as a Delaware corporation, we may pay dividends
+out of surplus capital or, if there is no surplus capital, out of net profits for the fiscal year in which a dividend is declared and/or
+the preceding fiscal year.
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 52 
+
+ 
+
+ 
+
+ 
+
+CAPITALIZATION
+
+ 
+
+The following table sets forth our cash and our
+capitalization as of February 28, 2025:
+
+ 
+
+ 
+ 
+ 
+ on an actual basis;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ on a pro forma basis, giving effect to (i) the Reverse Stock Split, (ii) the conversion of all
+ shares of Series A Convertible Preferred Stock and Series B Convertible Preferred Stock into 1,759,915 shares of common stock at
+ a conversion price of $4.00 per share (post-split) (see Certain Relationships and Related Party Transactions Letter
+ Agreement with Jonathan Bates and IDI ) (at an assumed public offering price of $8.00 per share, which is based on the last
+ reported sale price of our common stock on the OTCQX on May 16, 2025); (iii) the conversion of approximately $775,000 of indebtedness
+ due to an affiliate into common stock at the public offering price (at an assumed public offering price of $8.00 per share); and
+ (iv) the exchange of approximately $600,000 of indebtedness due to us by an affiliate for $600,000 of debt due from us (see Certain
+ Relationships and Related Party Transactions Letter Agreement with Jonathan Bates and IDI ); and 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ on a pro forma as adjusted basis, giving effect to the pro forma adjustments set forth above
+ and our issuance and sale of 1,875,000 shares of our common stock in this offering based on an assumed public offering price of $8.00
+ per share and assuming no exercise of the overallotment option, after deducting estimated underwriting discounts and commissions
+ and estimated offering expenses payable by us, but not giving effect to the pay-off of the Loan Payable to Luxor which occurred on
+ May 22, 2025.
+
+ 
+ 
+
+The pro forma as adjusted information set forth
+in the table below is illustrative only and will be adjusted based on the actual public offering price and other terms of this offering
+as determined at pricing. You should read the information in this table together with our consolidated financial statements and related
+notes and Management s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report
+on Form 10-K for the fiscal year ended August 31, 2024, incorporated by reference in this prospectus.
+
+ 
+
+ 
+ 
+ February 28, 2025 
+
+ 
+ 
+ Actual (1) 
+ Pro Forma (2) 
+ Pro Forma As Adjusted 
+
+ 
+ 
+ 
+ 
+
+ 
+ Cash and cash equivalents 
+ $482,951 
+ $482,951 
+ $13,857,951 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Short-Term Debt 
+ 
+ 
+ 
+
+ 
+ Loan Payable to Luxor 
+ 685,461 
+ 685,461 
+ 685,461 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Note Payable and Accrued Interest Related Party(3) 
+ 2,319,540 
+ 944,540 
+ 944,540 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Stockholder s equity 
+ 
+ 
+ 
+
+ 
+ Series A Preferred Stock, $0.0001 par value, 500,000 shares
+ authorized, 453,966 shares issued and outstanding as of February 28, 2025; 500,000 shares authorized and 0 outstanding, -0-pro forma
+ and -0- pro forma as adjusted. 
+ 45 
+ 
+ 
+
+ 
+ Series B Preferred Stock, $0.0001 par value, 3,000 shares
+ authorized, 2,500 shares issued and outstanding at February 28, 2025; 3,000 authorized and 0 outstanding, -0- pro forma and -0- pro
+ forma as adjusted. 
+ 
+ 
+ 
+
+ 
+ Common stock, $0.0001 par value, 500,000,000 shares authorized;
+ 39,667,607 (pre-split) issued and outstanding as of February 28, 2025; 2,080,255 outstanding pro forma, and 5,715,170 outstanding
+ pro forma as adjusted. 
+ 3,967 
+ 208 
+ 572 
+
+ 
+ Additional paid-in capital 
+ 16,165,284 
+ 16,944,089 
+ 30,318,725 
+
+ 
+ Accumulated deficit 
+ (13,316,148) 
+ (13,316,148) 
+ (13,316,148)
+
+ 
+ Total Stockholder s Equity 
+ 2,853,149 
+ 3,628,149 
+ 17,003,149 
+
+ 
+ Total Capitalization 
+ $6,341,101 
+ $5,741,101 
+ $32,491,101 
+
+ 
+
+ 
+
+(1)Pre-split share amounts.
+
+(2)Reflects the Reverse Stock Split.
+
+(3)Comprised of $1,875,000 in principal and $444,540 in accrued interest.
+
+ 
+
+ 
+
+ 53 
+
+ 
+
+ 
+
+ 
+A
+ $1.00 increase or decrease in the assumed public offering price of $8.00 per share would
+ increase or decrease the pro forma as adjusted amount of each of total stockholders 
+ equity and total capitalization by approximately $1,734,375 assuming that the number of shares
+ offered by us, as set forth on the cover page of this prospectus, remains the same and after
+ deducting the estimated underwriting discounts and commissions and estimated offering expenses
+ payable by us. An increase or decrease of 500,000 shares in the number of shares offered
+ by us, as set forth on the cover page of this prospectus, would increase or decrease the
+ pro forma as adjusted amount of each of cash and cash equivalents, additional paid-in capital,
+ total stockholders equity and total capitalization by approximately $3,700,000 assuming
+ no change in the assumed public offering price per share and after deducting the estimated
+ underwriting discounts and commissions and estimated offering expenses payable by us and
+ assuming no exercise of the underwriters overallotment option.
+
+ 
+
+The table above excludes 1,280 shares of common
+stock issuable upon the exercise of outstanding Class C-3 Warrants (25,600 shares of common stock on a pre-split basis,) with an exercise
+price of $25.00 (on a post-split basis) ($1.25 on a pre-split basis), and 3,750,000 shares of common stock (on a post-split basis) reserved
+for issuance pursuant to the 2025 Equity Incentive Plan.
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 54 
+
+ 
+
+ 
+
+ 
+
+DILUTION
+
+ 
+
+If you invest in our shares of common stock in
+this offering, your interest will be diluted to the extent of the difference between the public offering price per share of common stock
+and the pro forma as adjusted net tangible book value per share of common stock immediately after this offering.
+
+ 
+Our
+ net tangible book value is the amount of our total tangible assets less our total liabilities.
+ Our net tangible book value as of February 28, 2025 $2,853,149 or $1.44 per share (post-split)
+ of common stock.
+
+ 
+
+Pro forma net tangible book value post-split is
+our net tangible book value after taking into account the effect of (i) the conversion of all shares of Series A Convertible Preferred
+Stock and Series B Convertible Preferred Stock into common stock upon closing of the offering at their existing conversion prices of
+$4.00 per share (post-split) (see Certain Relationships and Related Party Transactions Letter Agreement with Jonathan Bates
+and IDI ), and (ii) the conversion of approximately $775,000 of indebtedness due to an affiliate into common stock at the public
+offering price (in each case, based upon an assumed public offering price of $8.00 per share). Our pro forma net tangible book value
+as of February 28, 2025 would have been approximately $3,628,149 or $1.74 per share.
+
+ 
+
+Pro forma as adjusted net tangible book value is
+our pro forma net tangible book value after taking into account the sale of common stock in this offering, at an assumed public offering
+price of $8.00 per share, after deducting the underwriting discounts and commissions and other estimated offering expenses payable by
+us. Our pro forma as adjusted net tangible book value as of February 28, 2025, would have been approximately $17,003,149, or $2.94 per
+share. This amount represents an immediate increase in pro forma as adjusted net tangible book value of approximately $1.50 per share
+to our existing stockholders, and an immediate dilution of $5.06 per share to new investors participating in this offering. Dilution
+per share to new investors is determined by subtracting pro forma as adjusted net tangible book value per share after this offering from
+the assumed public offering price per share paid by new investors.
+
+ 
+
+The following table illustrates this per share
+dilution(1):
+
+ 
+
+ 
+ Assumed public offering price per share 
+ $8.00 
+
+ 
+ Historical net tangible book value per share as of February 28, 2025 
+ $2,853,149 
+
+ 
+ Pro forma net tangible book value per share as of February 28 after pre-offering adjustments 
+ $3,628,149 
+
+ 
+ Increase in pro forma net tangible book value attributable to pre-offering adjustments 
+ $775,000 
+
+ 
+ Pro forma as adjusted net tangible book value per share after giving effect to this offering 
+ $2.94 
+
+ 
+ Increase in pro forma as adjusted pro forma net tangible book value per share attributable to the
+ offering 
+ $1.50 
+
+ 
+ Dilution in net tangible book value per share to new investors 
+ $5.06 
+
+ 
+
+ 
+
+ 
+ 
+ (1)
+ Does not include 1,280 shares of common stock (on a post-split basis) issuable upon the exercise
+ of outstanding Class C-3 Warrants (25,600 shares of common stock on a pre-split basis) with an exercise price of $25 (on a post-split
+ basis)($1.25 on a pre-split basis), and 3,750,000 shares of common stock (on a post-split basis) reserved for issuance pursuant to
+ the 2025 Equity Incentive Plan.
+
+ 
+ 
+
+A $1.00 increase in the assumed public offering
+price of $8.00 per share would increase our net tangible book value to $18,737,524 the net tangible book value per share after this offering
+to $3.24, and the dilution per share to new investors to $4.76 assuming the number of shares offered by us, as set forth on the cover
+page of this prospectus, remains the same, and after deducting the estimated underwriting discounts and commissions and estimated offering
+expenses payable by us. A $1.00 decrease in the assumed public offering price of $8.00 per share would increase our net tangible book
+value to $15,268,774, the net tangible book value per share after this offering to $2.64, and the dilution per share to new investors
+to $5.36, assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same, and after
+deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us.
+
+ 
+The
+ information above assumes that the underwriters do not exercise their overallotment option.
+ If the underwriters exercise the overallotment option in full, the pro forma as adjusted
+ net tangible book value will increase to $2.55 per share, representing an immediate increase
+ to existing stockholders of 1.11 per share and an immediate dilution of $5.45 per share to
+ new investors.
+
+ 
+
+To the extent that outstanding warrants are exercised,
+you will experience less dilution because the exercise price of all outstanding warrants will exceed the offering price. In addition,
+we may choose to raise additional capital due to market conditions or strategic considerations even if we believe we have sufficient funds
+for our current or future operating plans. To the extent that additional capital is raised through the sale of equity or convertible debt
+securities, the issuance of these securities may result in further dilution to our stockholders.
+
+ 
+
+ 
+
+ 55 
+
+ 
+
+ 
+
+ 
+
+USE OF PROCEEDS
+
+ 
+We
+ estimate that the net proceeds we will receive from the sale of our securities in this offering,
+ based upon an assumed public offering price of $8.00, and after deducting underwriting discounts
+ and commissions and estimated expenses payable by us, will be approximately $13,225,000 (or
+ $15,284,250) if the underwriters exercise their option to purchase additional shares in full).
+
+ 
+
+We currently expect to use all of the net proceeds
+from this offering in the short-term to purchase bitcoin. In the longer term, we expect to either sell bitcoin or leverage our bitcoin
+holdings for working capital and other general corporate purposes, including to expand our capacity to mine bitcoin by buying new miners
+and buying and installing new hosting equipment. The amounts and timing of these expenditures will depend on numerous factors, including
+the development of our current business initiatives. As of the date of this prospectus, we cannot specify with certainty all of the particular
+uses for the net proceeds from this offering and our management will have discretion and flexibility in applying the net proceeds of
+this offering. (See Risk Factors Risks Related to this Offering We have broad discretion
+in the opportunity to evaluate the economic, financial, or other information on which we base our decisions on how to use of our cash,
+cash equivalents and marketable securities, including the net proceeds from this offering, and may use them ineffectively, in ways with
+which you do not agree or in ways that do not increase the value of your investment. )
+
+ 
+A
+ $1.00 increase or decrease in the assumed public offering price of $8.00 per share would
+ increase or decrease the net proceeds from this offering by approximately $1,743,375, assuming
+ that the number of shares of common stock offered by us, as set forth on the cover page of
+ this prospectus, remains the same and after deducting the estimated underwriting discounts
+ and commissions and estimated offering expenses payable by us. An increase or decrease of
+ 500,000 in the number of shares of common stock offered by us would increase or decrease
+ our net proceeds by approximately $3,700,000 assuming the assumed public offering price remains
+ the same, and after deducting estimated underwriting discounts and commissions and estimated
+ offering expenses payable by us.
+
+ 
+
+Based on our current projections, we believe the
+net proceeds of this offering will fund our operations through December 31, 2025.
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 56 
+
+ 
+
+ 
+
+ 
+
+MANAGEMENT S DISCUSSION AND ANALYSIS
+OF FINANCIAL CONDITION AND RESULTS OF OPERATION
+
+ 
+
+You should read the following discussion and
+analysis of our financial condition and results of operations in conjunction with our financial statements and related notes to
+those statements included elsewhere in this prospectus. This discussion and analysis and other parts of this prospectus contain
+forward-looking statements based upon current beliefs, plans and expectations that involve risks, uncertainties and
+assumptions. Our actual results and the timing of selected events could differ materially from those anticipated in these
+forward-looking statements as a result of several factors, including those set forth under Risk Factors and
+elsewhere in this prospectus. You should carefully read the Risk Factors section of this prospectus to gain an
+understanding of the important factors that could cause actual results to differ materially from our
+forward-looking statements. Please also see the section entitled
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/BNZIW_banzai_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/BNZIW_banzai_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/BNZIW_banzai_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/BRIA_brillia_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/BRIA_brillia_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/BRIA_brillia_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/BRKK_barentsz_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/BRKK_barentsz_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..e0ede44d6f74d6753b52e9b145f939085b47bd5d
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/BRKK_barentsz_prospectus_summary.txt
@@ -0,0 +1,344 @@
+PROSPECTUS SUMMARY
+ 
+ 2
+
+ 
+ THE OFFERING
+ 
+ 10
+
+ 
+ RISK FACTORS
+ 
+ 11
+
+ 
+ USE OF PROCEEDS
+ 
+ 40
+
+ 
+ DIVIDEND POLICY
+ 
+ 41
+
+ 
+ CORPORATE HISTORY AND STRUCTURE
+ 
+ 42
+
+ 
+ CAPITALIZATION
+ 
+ 44
+
+ 
+ DILUTION
+ 
+ 45
+
+ 
+ MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
+ 
+ 46
+
+ 
+ INDUSTRY OVERVIEW
+ 
+ 56
+
+ 
+ BUSINESS
+ 
+ 57
+
+ 
+ REGULATIONS
+ 
+ 64
+
+ 
+ MANAGEMENT
+ 
+ 67
+
+ 
+ PRINCIPAL SHAREHOLDERS
+ 
+ 74
+
+ 
+ RELATED PARTY TRANSACTIONS
+ 
+ 75
+
+ 
+ DESCRIPTION
+ OF SECURITIES
+ 
+ 76
+
+ 
+ SHARES ELIGIBLE FOR FUTURE SALE
+ 
+ 85
+
+ 
+ TAXATION
+ 
+ 86
+
+ 
+ UNDERWRITING
+ 
+ 91
+
+ 
+ EXPENSES OF THE OFFERING
+ 
+ 98
+
+ 
+ LEGAL MATTERS
+ 
+ 99
+
+ 
+ EXPERTS
+ 
+ 100
+
+ 
+ ENFORCEMENT OF CIVIL LIABILITIES
+ 
+ 101
+
+ 
+ WHERE YOU CAN FIND MORE INFORMATION
+ 
+ 102
+
+ 
+ INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
+ 
+ F-1
+
+ 
+ 
+
+ i
+
+ 
+
+ 
+
+ 
+
+No
+dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus or
+in any free writing prospectus we may authorize to be delivered or made available to you. You must not rely on any unauthorized information
+or representations. This prospectus is an offer to sell only the Class A Ordinary Shares offered hereby, but only under circumstances
+and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of the date of this
+prospectus, regardless of the time of delivery of this prospectus or of any sale of the Class A Ordinary Shares.
+
+ 
+
+For
+investors outside the United States: neither we nor the underwriters have done anything that would permit this offering or possession
+or distribution of this prospectus in any jurisdiction, other than the United States, where action for that purpose is required. Persons
+outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating
+to, the offering of the Class A Ordinary Shares and the distribution of this prospectus outside the United States.
+
+ 
+
+Neither
+we nor any of the underwriters have authorized anyone to provide you with any information or to make any representations other than those
+contained in this prospectus, any amendment or supplement to this prospectus, or in any free writing prospectus we have prepared, and
+neither we nor the underwriters take responsibility for, and can provide no assurance as to the reliability of, any other information
+others may give you. Neither we nor the underwriters are making an offer to sell, or seeking offers to buy, these securities in any jurisdiction
+where the offer or sale is not permitted. The information contained in this prospectus is accurate only as of the date on the cover page
+of this prospectus, regardless of the time of delivery of this prospectus or the sale of shares. Our business, financial condition, results
+of operations and prospects may have changed since the date on the cover page of this prospectus.
+
+ 
+
+Until
+[*], 2025 (25 days after the date of this prospectus), all dealers that effect transactions in these securities, whether or not participating
+in this offering, may be required to deliver a prospectus. This is in addition to the dealer s obligation to deliver a prospectus
+when acting as an underwriter and with respect to their unsold allotments or subscriptions.
+
+ 
+
+CONVENTIONS WHICH APPLY TO THIS PROSPECTUS
+
+ 
+
+Throughout
+this prospectus, we use a number of key terms and provide a number of key performance indicators used by management. Unless the context
+otherwise requires, the following definitions apply throughout where the context so admits:
+
+ 
+
+ 
+ 
+ "AHFCAA" refers to Accelerating Holding Foreign Companies Accountable Act;
+
+ 
+ 
+ "Barentsz HK" refers to Barentsz Asset Management Limited;
+
+ 
+ 
+ "BVI Act" refers to the BVI Business Companies Act, 2004 (as amended) and includes the regulations made thereunder;
+
+ 
+ 
+ "BVI" refers to the British Virgin Islands;
+
+ 
+ 
+ "CAC" refers to Cyberspace Administration of China;
+
+ 
+ 
+ "CAGR" refers to compound annual growth rate;
+
+ 
+ 
+ "Class A Ordinary Shares" refer to the Class A Ordinary Shares of our Company, par value
+ $0.00001 per share;
+
+ 
+ 
+ "Class B Ordinary Shares" refer to the Class B Ordinary Shares of our Company, par value
+ $0.00001 per share;
+
+ 
+ 
+ "CSRC" refers to China Securities Regulatory Commission;
+
+ 
+ 
+ "Exchange Act" refers to Securities Exchange Act of 1934, as amended;
+
+ 
+ 
+ "FY 2025" and "FY 2024" refer to fiscal years ended April 30, 2025, and April 30, 2024, respectively;
+
+ 
+ 
+ "HFCAA" refers to Holding Foreign Companies Accountable Act;
+
+ 
+ 
+ "HK$," "HKD" or "Hong Kong dollar" refers to the legal currency of Hong Kong;
+
+ 
+ 
+ "Hong Kong" refers to The Hong Kong Special Administrative Region of the People s Republic of China;
+
+ 
+ 
+ "Macau" refers to The Macao Special Administrative Region of the People s Republic of China;
+
+ 
+ 
+ "mainland China" refers to the PRC, excluding, solely for the purpose of this prospectus, Hong Kong, Macau and Taiwan. The term "mainland Chinese" has a correlative meaning for the purpose of this prospectus;
+
+ 
+ 
+
+ ii
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ "Nasdaq" refers to Nasdaq Capital Market; 
+
+ 
+ 
+ "PCAOB" refers to Public Company Accounting Oversight Board;
+
+ 
+ 
+ "PRC", in each case, refers to the People s Republic of China;
+
+ 
+ 
+ "Premier ESG" refers to Premier ESG Services Limited;
+
+ 
+ 
+ "SEC" refers to the United States Securities and Exchange Commission;
+
+ 
+ 
+ "Securities Act" refers to The Securities Act of 1933, as amended;
+
+ 
+ 
+ "Shares" or "Ordinary Shares" refer to the Class A Ordinary Shares and the Class B Ordinary Shares;
+
+ 
+ 
+ "Trial Administrative Measures" refers to Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies;
+
+ 
+ 
+ "U.S. dollars," "dollars," "USD" or "$" refers to the legal currency of the United States; 
+
+ 
+ 
+ "US", "U.S." or "USA" refers to The United States of America;
+ and
+
+ 
+ 
+ "we," "us," "our," and the "Company" refer to Barentsz
+ Capital Limited, an exempted company incorporated with limited liability under the laws of BVI, and its subsidiary.
+
+ 
+ 
+
+All
+information in this prospectus assumes no exercise by the underwriters of their over-allotment option unless the context indicates otherwise.
+
+ 
+
+Our
+business is conducted directly by us and through our subsidiary in Hong Kong and we do not operate in mainland China, Macau,
+or Taiwan. Our consolidated financial statements are presented in U.S. dollars. In this prospectus, we refer to assets, obligations,
+commitments, and liabilities in our consolidated financial statements in U.S. dollars. These dollar references are based on the exchange
+rate (7.8:1) of HK dollars to U.S. dollars, determined as of a specific date or for a specific period. Changes in the exchange
+rate will affect the amount of our obligations and the value of our assets in terms of U.S. dollars which may result in an increase or
+decrease in the amount of our obligations (expressed in dollars) and the value of our assets, including accounts receivable (expressed
+in dollars).
+
+ 
+
+The
+expressions "associated company", "related corporation" and "subsidiary" shall have the respective
+meanings ascribed to them in the BVI Act, as the case may be. Any discrepancies in tables included herein between the total sum of amounts
+listed and the totals thereof are due to rounding. Accordingly, figures shown as totals in certain tables may not be an arithmetic aggregation
+of the figures that precede them.
+
+ 
+
+Certain
+of our customers and suppliers are referred to in this prospectus by their trade names. Our contracts with these customers and suppliers
+are typically with an entity or entities in the relevant customer or supplier s group of companies.
+
+ 
+
+Internet
+site addresses in this prospectus are included for reference only and the information contained in any website, including our website,
+is not incorporated by reference into, and does not form part of, this prospectus.
+
+ 
+
+ iii
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/BTFT_beta_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/BTFT_beta_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
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+PROSPECTUS SUMMARY 1
\ No newline at end of file
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+PROSPECTUS SUMMARY
+This summary highlights certain information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. For a more complete understanding of this offering, you should read the entire prospectus carefully, including the risk factors and the financial statements. Unless otherwise stated in this prospectus, references to:
+ we, us, our company or the Company refers to Caedryn Acquisition Corporation I, a Cayman Islands exempted company;
+ China and PRC refer to the People s Republic of China, including, for the purposes of this prospectus, Macau and Hong Kong.
+ Class A ordinary shares are to our Class A ordinary shares, par value $0.0001 per share;
+ Class B ordinary shares are to our Class B ordinary shares, par value $0.0001 per share;
+ Companies Act refers to the Companies Act (As Revised) of the Cayman Islands as the same may be amended and supplemented from time to time;
+ equity-linked securities are to any securities of our company which are convertible into or exchangeable or exercisable for, ordinary shares of our company, including but not limited to a private placement of equity or debt;
+ founders refers to all of our shareholders immediately prior to the date of this prospectus, including all of our officers and directors to the extent they hold such shares;
+ founder shares refers to the 1,725,000 Class B ordinary shares held by our founders prior to this offering (including up to an aggregate of 225,000 Class B ordinary shares subject to forfeiture to the extent that the underwriters over-allotment option is not exercised in full), including (i) 1,425,000 founder shares owned by our sponsor, Caedryn Acquisition Sponsor, and (ii) 300,000 founder shares owned by our Chief Executive Officer and director, Ms. Mi (Miriam) Zhou;
+ initial shareholders refers to our founders with respect to their holding of founder shares;
+ letter agreements refer to the agreements to be executed among us, underwriters, our officers, directors and other founders on the date that the registration statement is declared effective;
+ management or our management team are to our officers and directors;
+ ordinary resolution are to a resolution of the company passed by a simple majority of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at a general meeting of the company, or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter;
+ ordinary shares are to our Class A ordinary shares and Class B ordinary shares;
+ private units refer to the units that our sponsor is purchasing privately from us in a private placement simultaneously with the closing of this offering, as well as any units that may be issued upon conversion of working capital loans;
+ private rights refer to the rights underlying the private units;
+ private shares refer to the Class A ordinary shares, par value $0.0001 per share, underlying the private units as well as any Class A ordinary shares underlying any working capital units that may be issued upon conversion of working capital loans;
+
+2
+
+Table of Contents
+
+ public shares refer to Class A ordinary shares which are being sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market) shareholder;
+ public shareholders means the holders of the Class A ordinary shares which are being sold as part of the units in this public offering, or public shares, whether they are purchased in the public offering or in the aftermarket, including any of our founders to the extent that they purchase such public shares (except that our founders will not have conversion or tender rights with respect to any public shares they own);
+
+ representative shares refer to 180,000 Class A ordinary shares (or up to 207,000 Class A ordinary shares if the underwriters over-allotment option is exercised in full) to be issued to Maxim Group LLC and/or its designees, at the closing of this offering;
+ second amended and restated memorandum and articles of association are to our Second Amended and Restated Memorandum and Articles of Association to be adopted immediately prior to or upon effectiveness of this prospectus;
+ special resolution are to a resolution of the company passed by a majority of at least two-thirds (2/3) (or such higher approval threshold as specified in the company s second amended and restated memorandum and articles of association) of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at a general meeting of the company of which notice specifying the intention to propose the resolution as a special resolution has been duly given, or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter;
+ sponsor refers to Caedryn Acquisition Sponsor, a Cayman Islands exempted company;
+ U.S. or United States refers to the United States of America;
+ units are to units sold in this offering, each consisting of one Class A ordinary share and one right to receive one-seventh (1/7) of one Class A ordinary share;
+ US Dollars and $ refer to the legal currency of the United States of America; and
+ working capital units are to units issuable upon conversion of working capital loans, if any, at $10.00 per unit, upon the consummation of the business combination.
+
+Except as specifically provided otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option.
+All references in this prospectus to our founder shares being forfeited shall take effect as surrenders for no consideration of such shares as a matter of the Cayman Islands law. All references to the conversion of the Class B ordinary shares shall take effect as a compulsory redemption of Class B ordinary shares and an issuance of the corresponding Class A ordinary shares as a matter of Cayman Islands law.
+You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with different information. We are not making an offer of these securities in any jurisdiction where the offer is not permitted.
+ 
+
+3
+
+Table of Contents
+
+General
+We are a blank check company incorporated in the Cayman Islands on February 20, 2025 as an exempted company with limited liability (meaning that our public shareholders have no liability, as shareholders of our company, for the liabilities of our company over and above the amount paid for their shares). We were formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or similar business combination with one or more businesses or entities, which we refer to as a target business. Our efforts to identify a prospective target business will not be limited to a particular industry or geographic location. We do not have any specific business combination under consideration and we have not (nor has anyone on our behalf), directly or indirectly, contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to such a transaction. Additionally, we have not engaged or retained any agent or other representative to identify or locate any suitable acquisition candidate, to conduct any research or take any measures, directly or indirectly, to locate or contact a target business.
+Our Founders and Management
+One of our founders is our sponsor, Caedryn Acquisition Sponsor, a Cayman Islands limited liability company.
+The other founders are officers and directors of the Company. We believe that with their experience and skillsets in sourcing, investing, and value-enhancement, we are well positioned in pursuing opportunities that will offer risk-adjusted returns.
+Our officers and directors are as follows:
+Ms. Mi (Miriam) Zhou, is our Chief Executive Officer and director. Ms. Zhou has over 12 years of experience in cross-border investment and capital markets transactions, with a focus on initial public listings in the United States of America, mergers and acquisitions and SPAC transactions. Ms. Zhou is the founder of China and Partners Limited (also known as China & Partners), a boutique advisory firm providing strategic and financial consulting services for initial public offerings in international markets and capital fundraising. Ms. Zhou has been serving as China and Partners Limited s chief executive officer and director since December 2019. Mr. Zhou served as a director of CAP Trust Limited, a private trustee services company, from June 2022 to August 2024. Ms. Zhou served as a director and chairman of the audit committee of MicroCloud Hologram, Inc., a technology company listed on Nasdaq (Nasdaq: HOLO), from September 2022 to February 2023. Ms. Zhou was a director of Golden Path Acquisition Corporation, a blank check company, from September 2021 to September 2022, before it consummated a business combination transaction with MicroCloud Hologram, Inc. in September 2022. Ms. Zhou has participated in the de-SPAC transaction of AIB Acquisition Corporation and PSI Group in 2024, where China and Partners Limited acted as the sole financial advisor. Ms. Zhou holds the ACMA (UK) and CGMA professional accounting designations. She received the Board Secretary certification from the Shenzhen Stock Exchange in 2015. Ms. Zhou earned her M.B.A. from The University of Hong Kong and holds a degree in Computer Science from King s College London.
+Mr. Luhuan (Lou) Zhong, is our Chief Financial Officer and director. Mr. Zhong brings over a decade of experience in finance, auditing and capital markets, with deep expertise in SPAC transactions, initial public offerings and cross-border investments. Mr. Zhong has been a director of Creekstone Ventures Ltd., a venture capital investment company focused on AI application and hardware, since February 2025, and the chief financial officer and director of Flag Ship Acquisition Corporation (Nasdaq: FSHP), a blank check company, since February 2021. Mr. Zhong has held roles at Deloitte Touche Tohmatsu, various securities companies, investment funds and private equity funds. Mr. Zhong served as the managing director at Hony Capital from August 2022 to March 2025, where he helped to launch an AI-focused investment initiative. Before that, Mr. Zhong led the initial public offering and corporate finance teams at China International Capital Corporation from February 2022 to August 2022. Mr. Zhong served as a consultant to Venus Acquisition Corporation from February 2021 to December 2022, and Longevity Acquisition Corporation from October 2019 to February 2021, and he previously served as a consultant for Greenland Acquisition Corporation from October 2018 to October 2019. From September 2015 to October 2018, Mr. Zhong served as a project manager of Haitong Securities Co. Ltd., and a senior auditor at Deloitte Touche Tohmatsu CPA LLP from September 2012 to September 2015. Mr. Zhong holds a Master of Arts in Finance degree from the Stern School of Business of New York University, and a bachelor s degree in finance from Macquarie University.
+We will identify independent director nominees and include disclosure with respect to such directors prior to the offering.
+
+4
+
+Table of Contents
+
+Our Sponsor
+Our sponsor, Caedryn Acquisition Sponsor, is a Cayman Islands limited liability company formed as an investment vehicle holding the securities of us and as the sponsor of the offering. The sole shareholder of the sponsor is Ms. Mi (Miriam) Zhou, who holds 100% of the shares of the sponsor and is the sole manager of the sponsor.
+Prior to this offering, our founders collectively own 1,725,000 founder shares, or 100% of our issued and outstanding shares (up to 225,000 founder shares of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised), including (i) 1,425,000 founder shares owned by our sponsor, Caedryn Acquisition Sponsor (up to 225,000 founder shares of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised); and (ii) 300,000 founder shares owned by our Chief Executive officer and director, Ms. Mi (Miriam) Zhou. Immediately after the offering, the sponsor is expected to hold 1,400,000 ordinary shares including 1,200,000 founder shares and 200,000 private shares included in the private units, or 100.0% of the issued and outstanding founder shares (assuming no exercise of the over-allotment option). Our sponsor has agreed and will enter into an agreement with us immediately prior to the effectiveness of this prospectus pursuant to which, (A) to vote their founder shares and private shares (as well as any public shares acquired in or after this offering) in favor of any proposed business combination, (B) not to propose, or vote in favor of, an amendment to our second amended and restated memorandum and articles of association that would stop our public shareholders from converting or selling their shares to us in connection with a business combination or affect the substance or timing of our obligation to redeem 100% of our public shares if we do not complete a business combination within 12 months from the closing of this offering (or up to 18 months if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) unless we provide dissenting public shareholders with the opportunity to convert their public shares into the right to receive cash from the Trust Account in connection with any such vote, (C) not to convert any founder shares and private shares (as well as any other shares acquired in or after this offering) into the right to receive cash from the Trust Account in connection with a shareholder vote to approve our proposed initial business combination (or sell any shares they hold to us in a tender offer in connection with a proposed initial business combination) or a vote to amend the provisions of our second amended and restated memorandum and articles of association relating to shareholders rights or pre-business combination activity and (D) that the founder shares and private shares shall not participate in any liquidating distribution upon winding up if a business combination is not consummated.
+Additionally, our sponsor and directors and executive officers have agreed not to transfer, assign or sell any of the founder shares (except to certain permitted transferees) until the earlier of (1) six months after the completion of our initial business combination and (2) the date on which we consummate a liquidation, merger, share exchange, reorganization, or other similar transaction after our initial business combination that results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property, unless otherwise approved by public shareholders in connection with a business combination; unless different transfer restrictions are otherwise approved by public shareholders in connection with the business combination. Notwithstanding the foregoing, if the last sale price of our Class A ordinary shares equals or exceeds $12.50 per share (as adjusted for share subdivisions, share capitalizations, rights issuances, subdivisions, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period beginning 150 days after our initial business combination, the founder shares will be released from the lock-up. The private units (including the underlying securities) will not be transferable, assignable or saleable until after the completion of our initial business combination (except to certain permitted transferees). We refer to such transfer restrictions throughout this prospectus as the lock-up.
+Immediately after the offering, the sponsor is expected to hold 1,400,000 ordinary shares including 1,200,000 founder shares and 200,000 private shares included in the private units, assuming no exercise of the over- allotment option. In total, assuming no exercise of over-allotment option, the sponsor paid a nominal aggregate purchase price of $25,000 for an aggregate of 1,725,000 founder shares (among which, 300,000 founder shares were transferred to our Chief Executive Officer and director, at $0.0145 per founder share), and will pay a purchase price of $2,000,000 for 200,000 private units. However, other than the foregoing, our sponsor or its affiliates have not received and will not receive any other form of compensation upon the closing of the offering.
+Our sponsor, officers and directors will directly or indirectly own our securities following this offering, and accordingly, they may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our sponsor, officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination.
+
+5
+
+Table of Contents
+
+The following table sets forth the payments to be received by our sponsor and its affiliates from us prior to or in connection with the completion of our initial business combination and the securities issued and to be issued by us to our sponsor or its affiliates:
+ 
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+Amount of Compensation to be Received
+ 
+Consideration Paid
+
+Entity/Individual
+ 
+or Securities Issued or to be Issued
+ 
+or to be Paid
+
+Caedryn Acquisition Sponsor
+ 
+1,200,000 Class B ordinary shares(1)
+ 
+$20,650
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+200,000 private units(2)
+ 
+$2,000,000
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+Up to $500,000
+ 
+Repayment of loans made to us by our sponsor to cover offering-related and organizational expenses.
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+$10,000 per month up to $120,000 (or $180,000 if the period to complete an initial business combination is extended) in accordance with the second amended and restated memorandum and articles of association
+ 
+Office space, administrative and support services, until consummation of our business combination
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+Up to $2,500,000 in working capital loans may be converted into private units at a price of $10.00 per unit
+ 
+Working capital loans to finance transaction costs in connection with an intended initial business combination.
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+Up to $1,200,000 (or up to $1,380,000 if over-allotment option is exercised in part or in full) in loans to extend the period that we must complete an initial business combination from 12 months following the closing of the offering to up to 18 months following the closing of the offering in accordance our second amended and restated memorandum and articles of association, evidenced by extension convertible notes to be repaid in cash or converted into units at a price of $10.00 per unit
+ 
+Loan in support of our potential extension to allow additional time for us to complete an initial business combination
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+Reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination
+ 
+Services in connection with identifying, investigating and completing an initial business combination.
+
+ 
+
+(1)Assumes no exercise of the over-allotment option and the full forfeiture of 225,000 Class B ordinary shares that are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised.
+(2)Assumes no exercise of the over-allotment option.
+
+ 
+
+6
+
+Table of Contents
+
+The nominal purchase price paid by our sponsor for the founder shares may significantly dilute the implied value of your public shares in the event we consummate an initial business combination, and our sponsor and other initial shareholders are likely to make a substantial profit on their investment in us in the event we consummate an initial business combination, even if the business combination causes the trading price of our ordinary shares to decline materially. The following table sets forth information with respect to our initial shareholders, representative, and public shareholders:
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+Average
+
+ 
+ 
+Shares
+ 
+Total Consideration
+ 
+Price per
+
+Holder of
+ 
+Purchased
+ 
+Percentage
+ 
+Amount
+ 
+Percentage
+ 
+Share
+
+Founder shares(1)
+ 
+ 1,500,000
+ 
+ 17.11
+% 
+$
+ 25,000
+ 
+ 0.04
+% 
+$
+ 0.02
+
+Private shares(2)
+ 
+ 228,571
+ 
+ 2.61
+% 
+$
+ 2,000,000
+ 
+ 3.22
+% 
+$
+ 8.75
+
+Representative shares
+ 
+ 180,000
+ 
+ 2.05
+% 
+$
+ 
+ 
+ 
+ 
+$
+ 
+
+Public shareholders(3)
+ 
+ 6,857,142
+ 
+ 78.23
+% 
+$
+ 60,000,000
+ 
+ 96.74
+% 
+$
+ 8.75
+
+Total
+ 
+ 8,765,713
+ 
+ 100.00
+% 
+$
+ 62,025,000
+ 
+ 100.00
+% 
+$
+ 7.08
+
+(1)Assumes no exercise of the over-allotment option and forfeiture by our sponsor of 225,000 shares of Class B ordinary shares.
+(2)Includes the issuance of an additional 28,571 Class A ordinary shares underlying the rights contained in the private units.
+(3)Includes the issuance of an additional 857,142 Class A ordinary shares underlying the rights contained in the public units.
+
+For a summary of the securities owned by the sponsor and the relevant terms, see illustration below:
+ 
+ 
+ 
+ 
+ 
+Number of
+ 
+ 
+
+ 
+ 
+Number of 
+ 
+Securities After
+ 
+ 
+
+ 
+ 
+Securities 
+ 
+Offering (assuming
+ 
+ 
+
+Types of 
+ 
+Before 
+ 
+no over-allotment
+ 
+ 
+
+Securities
+ 
+Offering
+ 
+option exercised)
+ 
+Lock-Up Terms
+
+Founder Shares 
+ 
+1,425,000
+ 
+1,200,000
+ 
+As provided in a letter agreement to be entered by and among the Company and the initial shareholders on the date that the registration statement is declared effective, our sponsor has agreed not to transfer, assign or sell any of the founder shares (except to certain permitted transferees) until the earlier of (1) six months after the completion of our initial business combination and (2) the date on which we consummate a liquidation, merger, share exchange, reorganization, or other similar transaction after our initial business combination that results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property, unless otherwise approved by public shareholders in connection with a business combination; unless different transfer restrictions are otherwise approved by public shareholders in connection with the business combination. Notwithstanding the foregoing, if the last sale price of our Class A ordinary shares equals or exceeds $12.50 per share (as adjusted for share subdivisions, share capitalizations, rights issuances, subdivisions, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period beginning 150 days after our initial business combination, the founder shares will be released from the lock-up.
+
+Private Shares 
+ 
+0
+ 
+200,000
+ 
+As provided in a letter agreement to be entered by and among the Company and the initial shareholders on the date that the registration statement is declared effective, the private shares will not be transferable, assignable or saleable until after the completion of our initial business combination (except to certain permitted transferees)
+
+Private Rights 
+ 
+0
+ 
+200,000
+ 
+As provided in a letter agreement to be entered by and among the Company and the initial shareholders on the date that the registration statement is declared effective, the private rights will not be transferable, assignable or saleable until after the completion of our initial business combination (except to certain permitted transferees)
+
+ 
+
+7
+
+Table of Contents
+
+In order to meet our working capital needs following the consummation of this offering until completion of an initial business combination, our founders, officers and directors or their affiliates or designees may, but are not obligated to, loan us funds, from time to time or at any time, in whatever amount they deem reasonable in their sole discretion. The notes would either be paid upon consummation of our initial business combination, without interest, or, at the lender s discretion, up to $2,500,000 of the notes, or the working capital notes, may be converted upon consummation of our business combination into working capital units at a price of $10.00 per unit, or the working capital units. In addition, our founders, officers and directors or their affiliates or designees may loan us funds in support of our potential extension to allow additional time for us to complete an initial business combination which will be evidenced in extension convertible notes, or the extension notes, to be repaid in cash or converted into units at a price of $10.00 per unit, or the extension units, at the closing of our initial business combination. If we do not complete our initial business combination, the loans would be repaid out of funds not held in the Trust Account, and only to the extent available. The working capital units and extension units would be identical to the private units sold in the private placement. The terms of such loans by our founders, officers and directors or their affiliates or designees, if any, have not been determined and no written agreements exist with respect to such loans. We do not expect to seek loans from parties other than our founders or an affiliate of our founders as we do not believe third parties will be willing to loan such funds and provide a waiver against any and all rights to seek access to funds in our Trust Account, but if we do, we will request such lender to provide a waiver against any and all rights to seek access to funds in our Trust Account.
+Other than the foregoing, the sponsor does not have any agreement, arrangement, or understanding with the Company regarding any compensation, reimbursement, or transfer of interests in relation to our initial business combination, nor is there any agreement between the sponsor and any unaffiliated shareholders of the Company regarding redemptions, payments, compensation, reimbursement, or transfer of interests.
+As a blank check company incorporated for the purpose of effecting a business combination, we have ties to China. Ms. Mi (Miriam) Zhou, our Chief Executive Officer and director, who also beneficially owns 100.0% issued and outstanding shares of the sponsor and serves as its director, is located in China. Because of our ties to China, we may be a less attractive partner to a non-China-based target company and such perception may potentially limit or negatively impact our search for an initial business combination. See Risk Factors Because some of our executive officers and directors are located in or have ties to China, you may face difficulties in protecting your interests, and your ability to protect your rights through the U.S. Federal courts may be limited on page 83 of this prospectus. Our sponsor will own 17.8% of our issued and outstanding shares following this offering. As a result, we may be considered a foreign person under rules promulgated by the CFIUS, and may not be able to complete an initial business combination with a U.S. target company since such initial business combination may be subject to U.S. foreign investment regulations and review by a U.S. government entity such as CFIUS), or ultimately prohibited. As a result, the pool of potential targets with which we could complete an initial business combination may be limited.
+Upon the effectiveness of this prospectus, our management will include one director and Chief Executive Officer, who is located in Shenzhen, China, and one director and our Chief Financial Officer who is located in Shanghai, China. We will identify independent director nominees and include disclosure with respect to such directors prior to the offering. Further, there is uncertainty if any officers and directors of the post- combination entity will be located outside the United States of America. As a result, it may be difficult, or in some cases not possible, for investors in the United States of America to enforce their legal rights, to effect service of process upon those officers and directors (prior to or after the business combination) located outside the United States of America, to enforce judgments of United States courts predicated upon civil liabilities and criminal penalties on them under United States securities laws. In particular, the PRC does not have treaties providing for the reciprocal recognition and enforcement of judgments of courts with the United States of America and many other countries and regions, and you may have to incur substantial costs and contribute significant time to enforce civil liabilities and criminal penalties in reliance on legal remedies under PRC laws. Therefore, recognition and enforcement in the PRC of judgement of United States courts in relation to any matter not subject to a binding arbitration provision may be difficult or impossible. See Risk Factors Since certain of our directors and officers are based in or have ties to China, the Chinese government may have potential oversight and discretion over the conduct of our directors and officers search for a target company. The Chinese government may intervene or influence our operations at any time through our directors and officers who are based in or have ties in China, which could result in a material change in our search for a target business and the value of the securities we are offering. Changes in the policies, regulations, rules, and the enforcement of laws of the PRC government may be adopted quickly with little advance notice and could have a significant impact upon our ability to operate starting on page 38 of this prospectus.
+
+8
+
+Table of Contents
+
+As more fully discussed in Management Conflicts of Interest, if any of our officers or directors becomes aware of a business combination opportunity that falls within the line of business of any entity to which he has pre-existing fiduciary or contractual obligations, he may be required to present such business combination opportunity to such entity, subject to his or her fiduciary duties under the Cayman Islands law, prior to presenting such business combination opportunity to us. Most of our officers and directors currently have certain pre-existing fiduciary duties or contractual obligations.
+Background and Competitive Strengths
+We will seek to leverage our management team s proprietary network of relationships with corporate executives, private equity, venture and growth capital funds, investment banking firms and consultants in order to source, acquire, and support the operations of the business combination target. Ms. Mi (Miriam) Zhou, our Chief Executive Officer and director, has accumulated substantial experience and extensive resources from her 12-years of experiences in cross-border investment and capital markets, with a focus on initial public offering listings in the United States of America, mergers and acquisitions and SPAC transactions. Mr. Luhuan (Lou) Zhong, our Chief Financial Officer and director, brings over a decade of extensive experience in finance, auditing and capital markets, including specialized expertise in SPAC transactions, initial public offerings and cross-border investments.
+Further, our management team, comprising our executive officers and directors, have experience in management and serving on the boards of directors in public companies and international companies. We will leverage their relevant experience to search and evaluate business combination targets, perform due diligence and provide post business combination value-add capabilities.
+We believe that this combination of extensive relationships and expertise will make us a preferred partner for and allow us to source high-quality business combination targets. However, none of our management team is obligated to remain with the company after an acquisition transaction, and we cannot provide assurance that the resignation or retention of our current management will be a term or condition in any agreement relating to business combination. Moreover, despite the competitive advantages we believe we have, we remain subject to significant competition with respect to identifying and executing a business combination.
+Business Strategy and Acquisition Criteria
+The main ambition of our management is to create value for our shareholders by completing a business combination with a target business where we would potentially utilize our experience by working with management of the target business to attract market attention and interests, generate access to capital, improve the operating efficiency, implement revenue-driven and/or profit-engagement strategies and increase profit potential through additional acquisitions. Consistent with our strategy, we have identified the following general criteria and guidelines that we believe are essential in evaluating prospective target businesses. While we intend to use these criteria and guidelines in evaluating prospective businesses, we may deviate from these criteria and guidelines should we consider it appropriate to do so:
+Strong Management Team
+The strength of the management team will be an important component in our review process. We will seek to partner with a management team that is operationally strong and has demonstrated the ability to scale, but is also well-incentivized and aligned in our future vision for creating long term shareholder value.
+Long-term Revenue Visibility with Defensible Market Position
+In management s view, the target companies should be close to an anticipated inflection point, such as those companies requiring additional management expertise, those companies able to innovate by developing new products or services, or companies where we believe we have the ability to achieve improved profitability performance through an acquisition designed to help facilitate growth.
+Benefits from Being a U.S. Public Company (Value Creation and Marketing Opportunities)
+We intend to seek target companies that we believe will help offer attractive risk-adjusted equity returns for our shareholders. We intend to seek to acquire a target on terms and in a manner that leverages our experience. Among other criteria, we expect to evaluate financial returns based on (i) the potential for organic growth in cash flows, (ii) the ability to achieve cost savings, (iii) the ability to accelerate growth, including through the opportunity for follow-on acquisitions, and (iv) the prospects for creating value through other value 
+
+9
+
+Table of Contents
+
+creation initiatives. We also plan to evaluate potential upside from future growth in the target business earnings and an improved capital structure.
+Growth Potential
+We will be looking for businesses that we believe present the potential for revenue and earnings growth through a combination of business, management and resources. We will also consider businesses with potential to generate stable and increasing free cash flow. We may also seek to prudently leverage this cash flow in order to enhance shareholder value.
+Global Impact
+We will seek to identify target companies that have a deep understanding of the role of technological innovation in terms of social responsibility. We believe that emerging infrastructure, particularly in artificial intelligence and financial technology, encompassing both foundation systems and applied solutions, will be pivotal in shaping our future on a global scale. These companies should not only drive innovation within their local communities but also create meaningful, far-reaching global impact.
+These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant.
+In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria and guidelines in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials that we would file with the U.S. Securities and Exchange Commission (the SEC ).
+We will either (i) seek shareholder approval of our initial business combination at a meeting called for such purpose at which public shareholders may seek to convert their public shares, regardless of whether they vote for or against, or abstain from voting on, the proposed business combination, into their pro rata portion of the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of the business combination, including interest (net of income taxes payable and up to $50,000 for liquidation expenses) or (ii) provide our public shareholders with the opportunity to sell their public shares to us by means of a tender offer (and thereby avoid the need for a shareholder vote) for an amount equal to their pro rata share of the aggregate amount then on deposit in the trust account calculated as of two business days prior to the consummation of the business combination, including interest (net of income taxes payable and up to $50,000 for liquidation expenses), in each case subject to the limitations described herein. Notwithstanding the foregoing, our founders have agreed, pursuant to written letter agreements with us, not to convert any ordinary shares held by them into their pro rata portion of the aggregate amount then on deposit in the trust account. The decision as to whether we will seek shareholder approval of our proposed business combination or allow shareholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek shareholder approval. If we so choose and we are legally permitted to do so, we will have the flexibility to avoid a shareholder vote and allow our shareholders to sell their shares pursuant to the tender offer rules of the SEC. In that case, we will file tender offer documents with the SEC which will contain substantially the same financial and other information about the initial business combination as is required under the SEC s proxy rules.
+We will have until 12 months from the effective date of this registration statement to consummate our initial business combination. If we anticipate that we may not be able to consummate our initial business combination within 12 months from the effective date of this registration statement, we may, but are not obligated to, extend the period of time to consummate a business combination two times by an additional three months each time (for a total of up to 18 months to complete a business combination), provided that our sponsor or designee must deposit into the trust account for each three months extension, $600,000, or $690,000 if the underwriters over-allotment option is exercised in full ($0.10 per share in either case), up to an aggregate of $1,200,000 or $1,380,000 if the underwriters over-allotment option is exercised in full, on or prior to the date of the applicable deadline. Our public shareholders will not be afforded an opportunity to vote on our extension of time to consummate an initial business combination from 12 months to up to 18 months described above or redeem their shares in connection with such extensions. If we are unable to consummate our initial business combination within such time period, unless we extend such period pursuant to an amendment to our second amended and restated memorandum and articles of association, we will, as promptly as possible but not more than ten (10) business days thereafter, redeem 100% of our issued and outstanding public shares for a pro rata portion of the funds held in the trust account, including a pro rata portion of any interest earned 
+
+10
+
+Table of Contents
+
+on the funds held in the trust account and not previously released to us or necessary to pay our taxes, and then seek to liquidate and dissolve. However, we may not be able to distribute such amounts as a result of claims of creditors which may take priority over the claims of our public shareholders. In the event of our liquidation and subsequent dissolution and the public rights will expire and will be worthless.
+If we are unable to consummate our initial business combination within this time period, we will liquidate the trust account and distribute the proceeds held therein to our public shareholders by way of redeeming their shares and dissolve. If we are forced to liquidate, we anticipate that we would distribute to our public shareholders the amount in the trust account calculated as of the date that is two (2) business days prior to the distribution date (including any accrued interest net of income taxes payable). Prior to such distribution, we would be required to assess all claims that may be potentially brought against us by our creditors for amounts they are actually owed and make provision for such amounts, as creditors take priority over our public shareholders with respect to amounts that are owed to them. We cannot assure you that we will properly assess all claims that may be potentially brought against us. As such, our shareholders could potentially be liable for any claims of creditors to the extent of distributions received by them as an unlawful payment in the event we enter an insolvent liquidation. In the event of our liquidation and subsequent dissolution, the public rights will expire and will be worthless.
+Pursuant to the Nasdaq listing rules, our initial business combination must be with a target business or businesses whose collective fair market value is at least equal to 80% of the balance in the trust account (excluding taxes payable on the income earned on the trust account) at the time of the execution of a definitive agreement for such business combination, although this may entail simultaneous acquisitions of several target businesses. The fair market value of the target business will be determined by our board of directors based upon one or more standards generally accepted by the financial community (such as actual and potential sales, earnings, cash flow and/or book value). Our board of directors will have broad discretion in choosing the standard used to establish the fair market value of any prospective target business. The target business or businesses that we acquire may have a collective fair market value substantially in excess of 80% of the trust account balance. We will not be required to comply with the 80% fair market value requirement if we are delisted from Nasdaq.
+We are not required to obtain an opinion from an unaffiliated third party that the target business we select has a fair market value in excess of at least 80% of the balance of the trust account unless our board of directors cannot make such determination on its own. We are also not required to obtain an opinion from an unaffiliated third party indicating that the price we are paying is fair to our shareholders from a financial point of view unless the target is affiliated with our officers, directors, founders or their affiliates.
+We currently anticipate structuring our initial business combination to acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination where we merge directly with the target business or where we acquire less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we could acquire a 100% controlling interest in the target; however, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, only the portion of such target business or businesses that is owned or acquired is what will be valued for purposes of the 80% fair market value test.
+We have not selected any specific business combination target but intend to target businesses with enterprise values that are greater than we could acquire with the net proceeds of this offering and the sale of the private units. As a result, if the cash portion of the purchase price exceeds the amount available from the trust account, net of amounts needed to satisfy any redemption by public shareholders, we may be required to seek additional financing to complete such proposed initial business combination. We cannot assure you that such financing will be available on acceptable terms, if at all. To the extent that additional financing proves to be unavailable when needed to complete our initial business combination, we would be compelled to either restructure the transaction or abandon that particular business combination and seek an alternative target business candidate. Further, we may be required to obtain additional financing in 
+
+11
+
+Table of Contents
+
+connection with the closing of our initial business combination for general corporate purposes, including for maintenance or expansion of operations of the post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, or to fund the purchase of other companies. If we are unable to complete our initial business combination, our public shareholders may only receive their pro rata portion of the funds in the trust account that are available for distribution to public shareholders, and our rights will expire worthless. In addition, even if we do not need additional financing to complete our initial business combination, we may require such financing to fund the operations or growth of the target business. The failure to secure additional financing could have a material adverse effect on the continued development or growth of the target business. None of our officers, directors or shareholders is required to provide any financing to us in connection with or after our initial business combination. Raising additional third party financing may involve dilutive equity issuances or the incurrence of indebtedness at higher than desirable levels. Furthermore, this dilution would increase to the extent that the anti-dilution provision of the Class B ordinary shares results in the issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion of the Class B ordinary shares at the time of our initial business combination.
+Other SPAC Involvement
+Our Chief Executive officer and director, Ms. Mi (Miriam) Zhou, served as a director of Golden Path Acquisition Corporation, a blank check company, from September 20221 to September 2022, before it consummated a business combination transaction with MircroCloud Hologram, Inc., a technology company, in September 2022. Ms. Zhou served as a director and chairman of the audit committee of MicroCloud Hologram, Inc. (Nasdaq: HOLO) from September 2022 to February 2023. Ms. Zhou has also participated in the de-SPAC transaction of AIB Acquisition Corporation and PSI Group in 2024, where China and Partners Limited, which is an international financial and advisory firm, acted as the sole financial advisor to PSI Group for the transaction.
+Our Chief Financial Officer and director, Mr. Luhuan (Lou) Zhong, serves as the Chief Financial Officer and a director of Flag Ship Acquisition Corporation, a Cayman Islands exempted corporation, which was incorporated for the purpose of effecting a merger, share exchange, assets acquisition, share purchase, recapitalization, reorganization or similar business combination with one or more businesses ( FSHP ). On June 17, 2024, FSHP consummated its initial public offering of 6,900,000 units, at an offering price of $10.00 per unit with each unit consisting of one ordinary share and one right to receive one-tenth (1/10) of an ordinary share upon the consummation of FSHP s initial business combination. In addition, FSHP made the private sale of 238,000 units to its sponsor, Whale Management Corporation, at a purchase price of $10.00 per unit. The initial public offering generated approximately $67.5 million in proceeds and the private sale of units to its sponsor generated approximately $1.5 million in proceeds. The units, ordinary shares, and rights are currently traded on Nasdaq under symbols FSHPU , FSHP , FSHPR , respectively. On October 21, 2024, FSHP entered into a merger agreement ( GRT Merger Agreement ) in connection with its business combination with Great Rich Technologies Limited ( GRT ), a public limited company incorporated under the laws of Hong Kong, and GRT Merger Start Limited ( GRT Merger Sub ), a Cayman Islands company limited by shares and a wholly-owned subsidiary of GRT. On February 28, 2025, FSHP, GRT and GRT Merger Sub entered into the first amendment to the merger agreement and agreed to extend the completion of the transactions contemplated by the GRT Merger Agreement to August 28, 2025. Mr. Zhong has served as FSHP s chief financial officer since February 2021, but did not participate in the formation of FSHP. Mr. Zhong owes fiduciary duties to FSHP in his capacity as its chief financial officer.
+Mr. Zhong also worked as a consultant to Venus Acquisition Corporation from February 2021 to December 2022, Longevity Acquisition Corporation from October 2019 to February 2021, and Greenland Acquisition Corporation from October 2018 to October 2019, where he assisted management teams of SPAC to conduct research, analysis and execute business acquisition.
+For more details on conflict of interests of our directors and/or officers, see Management Conflicts of Interest starting on page 124 of this prospectus.
+Emerging Growth Company Status and Other Information
+We are an emerging growth company as defined in Section 2(a) of the Securities Act of 1933, as amended, or the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (which we refer to herein as the JOBS Act). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory 
+
+12
+
+Table of Contents
+
+vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile.
+In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period.
+We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our ordinary shares that are held by non-affiliates exceeds $700 million as of as of the end of that year s second fiscal quarter, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three year period.
+Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates exceeds $250 million as of the end of that year s second fiscal quarter, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates exceeds $700 million as of the end of that year s second fiscal quarter. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible.
+Private Placements
+On May 31, 2025, (1) we issued 1,725,000 Class B ordinary shares of a par value of $0.0001 each to our sponsor for a purchase price of $25,000, or approximately $0.0145 per share, and (2) our sponsor surrendered 1 Class B ordinary shares of a par value of $0.0001 each. On June 1, 2025, our sponsor transferred 300,000 founder shares to our Chief Executive Officer and director, Ms. Mi (Miriam) Zhou, all at the original purchase price when the sponsor acquired such shares from us. We refer to these Class B ordinary shares throughout this prospectus as the founder shares. The founder shares held by our founders include an aggregate of up to 225,000 founder shares held by the sponsor subject to forfeiture to the extent that the underwriters over- allotment option is not exercised in full, so that our founders will collectively own approximately 20% of our issued and outstanding shares after this offering (not including the Class A ordinary shares issuable underlying the private units and the representative shares, any shares underlying units issued upon conversion of working capital loans and any Class A ordinary shares or equity-linked securities issued, or to be issued, to any seller in our initial business combination). None of our founders has indicated any intention to purchase units in this offering.
+In addition, our sponsor, has committed to purchase from us an aggregate of 200,000 private units at $10.00 per private unit (for a total purchase price of $2,000,000). These purchases will take place on a private placement basis simultaneously with the consummation of this offering. All of the proceeds we receive from these purchases will be placed in the trust account described below. Our sponsor has also agreed that if the over-allotment option is exercised by the underwriters, it will purchase from us at a price of $10.00 per private unit an additional number of private units (up to a maximum of 10,000 private units) pro rata with the amount of the over-allotment option exercised so that at least $10.00 per share sold to the public in this offering is held in trust regardless of whether the over-allotment option is exercised in full or part. These additional private units will be purchased in a private placement that will occur simultaneously with the purchase of units resulting from the exercise of the over-allotment option. The proceeds from the private placement of the private units will be added to the proceeds of this offering and placed in an account in the United States of America maintained by Continental Stock Transfer & Trust Company, as trustee. As a result, $60,000,000 (or up to $69,000,000 if the over-allotment option is exercised in part or in full) will be placed in the Trust Account, immediately following the offering. If we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months, if we extend the time to complete an initial business combination as described in this prospectus), the proceeds from the sale of the offering and private units deposited into the Trust Account including interests (net of income taxes payable and up to $50,000 of interest released to us to pay liquidation expenses) will be included in the liquidating distribution to the holders of our public shares.
+
+13
+
+Table of Contents
+
+Additionally, we have committed to issue to Maxim or its designees, the representative of the underwriters, 180,000 Class A ordinary shares (or up to 207,000 Class A ordinary shares if the over-allotment option is exercised in in full), or the representative shares, at the closing of this offering. We refer to Maxim throughout this prospectus as the representative .
+Immediately after the offering, the sponsor is expected to hold 1,400,000 ordinary shares including 1,200,000 founder shares and 200,000 private shares included in the private units, assuming no exercise of the over- allotment option. In total, assuming no exercise of over-allotment option, the sponsor paid a nominal aggregate purchase price of $25,000 for an aggregate of 1,725,000 founder shares (among which 300,000 founder shares were transferred to our Chief Executive Officer, at $0.0145 per founder share), and will pay purchase price of $2,000,000 for 200,000 private units. However, other than the foregoing, our sponsor or its affiliates have not received and will not receive any other form of compensation upon the closing of the offering.
+Because of the nominal consideration of $25,000 the sponsor paid for the founder shares, upon the closing of this offering, your public shares will be significantly diluted. To illustrate, the table below shows possible sources of dilution and the extent of such dilution that non-redeeming public shareholders could experience in connection with the closing of this offering. The table below assumes: Scenario A) 25% of the maximum number of our public shares are redeemed, Scenario B) 50% of the maximum number of our public shares are redeemed, Scenario C) 75% of the maximum number of our public shares are redeemed, and Scenario D) the maximum amount of our public shares are redeemed (not taking into consideration the requirement in our second amended and restated memorandum and articles of association to maintain net tangible assets of $5,000,001 upon consummation of a business combination).
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+Without Over-Allotment Option Exercised
+
+ 
+ 
+Scenario A 25%
+ 
+Scenario B 50%
+ 
+Scenario C 75%
+ 
+Scenario D
+
+ 
+ 
+of maximum
+ 
+of maximum
+ 
+of maximum
+ 
+maximum
+
+ 
+ 
+redemptions(1)
+ 
+redemptions(2)
+ 
+redemptions(3)
+ 
+redemptions(4)
+
+Offering price of $8.75 included in the units (adjusted to include the value of the rights)
+ 
+$
+ 8.75
+ 
+$
+ 8.75
+ 
+$
+ 8.75
+ 
+$
+ 8.75
+
+Pro forma net tangible book value per share, as adjusted
+ 
+$
+ 6.25
+ 
+$
+ 5.27
+ 
+$
+ 3.61
+ 
+$
+ 0.14
+
+Dilution to public shareholders (difference between pro forma net tangible book value per share and deemed offering price)
+ 
+$
+ 2.50
+ 
+$
+ 3.48
+ 
+$
+ 5.14
+ 
+$
+ 8.61
+
+(1)The numbers set forth in this column assume that 1,500,000 public shares, or 25%, of 6,000,000 public shares are redeemed.
+(2)The numbers set forth in this column assume that 3,000,000 public shares, or 50%, of 6,000,000 public shares are redeemed.
+(3)The numbers set forth in this column assume that 4,500,000 public shares, or 75%, of 6,000,000 public shares are redeemed.
+(4)The numbers set forth in this column assume that 6,000,000 public shares are redeemed, which is the maximum number of shares that can be redeemed (not taking into consideration the requirement in our second amended and restated memorandum and articles of association to maintain net tangible assets of $5,000,001 upon consummation of a business combination).
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+With Over-Allotment Option Exercised
+
+ 
+ 
+Scenario A 25%
+ 
+Scenario B 50%
+ 
+Scenario C 75%
+ 
+Scenario D
+
+ 
+ 
+of maximum
+ 
+of maximum
+ 
+of maximum
+ 
+maximum
+
+ 
+ 
+redemptions(5)
+ 
+redemptions(6)
+ 
+redemptions(7)
+ 
+redemptions(8)
+
+Offering price of $8.75 included in the units (adjusted to include the value of the rights)
+ 
+$
+ 8.75
+ 
+$
+ 8.75
+ 
+$
+ 8.75
+ 
+$
+ 8.75
+
+Pro forma net tangible book value per share, as adjusted 
+ 
+$
+ 6.26
+ 
+$
+ 5.29
+ 
+$
+ 3.62
+ 
+$
+ 0.14
+
+Dilution to public shareholders (difference between pro forma net tangible book value per share and deemed offering price)
+ 
+$
+ 2.49
+ 
+$
+ 3.46
+ 
+$
+ 5.13
+ 
+$
+ 8.61
+
+(5)The numbers set forth in this column assume that 1,725,000 public shares, or 25%, of 6,900,000 public shares are redeemed.
+(6)The numbers set forth in this column assume that 3,450,000 public shares, or 50%, of 6,900,000 public shares are redeemed.
+(7)The numbers set forth in this column assume that 5,175,000 public shares, or 75%, of 6,900,000 public shares are redeemed.
+
+14
+
+Table of Contents
+
+(8)The numbers set forth in this column assume that 6,900,000 public shares are redeemed, which is the maximum number of shares that can be redeemed (not taking into consideration the requirement in our second amended and restated memorandum and articles of association to maintain net tangible assets of $5,000,001 upon consummation of a business combination).
+
+For further information on the dilutive effect of the founder shares, see Dilution on page 90, and Risk Factor Our sponsor paid an aggregate of $25,000, or approximately $0.0145 per founder share, and, accordingly, you will experience immediate and substantial dilution upon the purchase of our ordinary shares on page 64 of this prospectus.
+The founder shares, private shares and representative shares are identical to the Class A ordinary shares included in the units being sold in this offering. However, our founders have agreed, pursuant to written letter agreements with us, (A) to vote their founder shares and private shares in favor of any proposed business combination, (B) not to propose, or vote in favor of, an amendment to our second amended and restated memorandum and articles of association that would stop our public shareholders from converting or selling their shares to us in connection with a business combination or affect the substance or timing of our obligation to redeem 100% of our public shares if we do not complete a business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) unless we provide dissenting public shareholders with the opportunity to convert their public shares into the right to receive cash from the trust account in connection with any such vote, (C) not to convert any founder shares and private shares (as well as any other shares acquired in or after this offering) into the right to receive cash from the trust account in connection with a shareholder vote to approve our proposed initial business combination (or sell any shares they hold to us in a tender offer in connection with a proposed initial business combination) or a vote to amend the provisions of our second amended and restated memorandum and articles of association relating to shareholders rights or pre-business combination activity and (D) that the founder shares and private shares shall not participate in any liquidating distribution upon winding up if a business combination is not consummated.
+Nasdaq rules currently allow us to engage in a tender offer in lieu of a shareholder meeting but would still require us to obtain shareholder approval if we were seeking to issue more than 20% of our outstanding shares to a target business as consideration in any business combination. Therefore, if we were structuring a business combination that required us to issue more than 20% of our outstanding shares, we would seek shareholder approval of such business combination. Our founders have agreed, pursuant to written letter agreements with us, to vote their founder shares and private shares in favor of any proposed business combination. If we seek shareholder approval in connection with the business combination, in addition to our founder shares and private placement shares, assuming all the representative shares held by Maxim will be voted for, in order to have our initial business combination approved, we would need only 2,060,001, or 34.3%, of the 6,000,000 public shares sold in this offering to be voted in favor of a transaction (assuming all outstanding shares are voted), or no public shares sold in this offering are needed to vote in favor of a transaction (assuming only a quorum is present at such meeting held to vote on our initial business combination) (in either case, assuming the over-allotment option is not exercised). Under Nasdaq listing rules, where shareholder approval is required, the minimum vote that will constitute shareholder approval shall be a majority of total votes cast on the proposal.
+Additionally, our founders have agreed not to transfer, assign or sell any of the founder shares (except to certain permitted transferees) until the earlier of (1) six months after the completion of our initial business combination and (2) the date on which we consummate a liquidation, merger, share exchange, reorganization, or other similar transaction after our initial business combination that results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property, unless otherwise approved by public shareholders in connection with a business combination; unless different transfer restrictions are otherwise approved by public shareholders in connection with the business combination. Notwithstanding the foregoing, if the last sale price of our Class A ordinary shares equals or exceeds $12.50 per share (as adjusted for share subdivisions, share capitalizations, rights issuances, subdivisions, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period beginning 150 days after our initial business combination, the founder shares will be released from the lock- up. The private units (including the underlying securities) will not be transferrable, assignable or saleable until after the completion of our initial business combination (except to certain permitted transferees). We refer to such transfer restrictions throughout this prospectus as the lock-up.
+The representative shares have been deemed compensation by FINRA and are therefore subject to a lock-up for a period of 180 days immediately following the date of the commencement of sales of this offering pursuant to FINRA Rule 5110(e)(1). Pursuant to FINRA Rule 5110(e)(1), these securities will not be the subject of any hedging, short sale, derivative, put or call transaction that would result in the economic disposition of the securities by any person for a period of 180 days immediately following the commencement of sales of this offering, nor may they be sold, transferred, assigned, pledged or hypothecated for a period of 180 days immediately following the 
+
+15
+
+Table of Contents
+
+date of the commencement of sales of this offering except to any underwriter and selected dealer participating in the offering and their officers, partners, registered persons or affiliates.
+If public units or shares are purchased by any of our directors, officers or initial shareholders, they will be entitled to funds from the trust account to the same extent as any public shareholder upon our liquidation but will not have redemption rights related thereto.
+The proceeds from the private placement of the private units will be added to the proceeds of this offering and placed in a trust account in the United States of America maintained by Continental Stock Transfer & Trust Company, as trustee. If we do not complete our initial business combination within 12 months (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus), the proceeds from the sale of the private units will be included in the liquidating distribution to the holders of our public shares.
+Additional Financing
+We have not selected any specific business combination target but may enter into agreements with a target with enterprise values that are greater than what we could acquire with the net proceeds of this offering and the sale of the private units. As a result, if the cash portion of the purchase price exceeds the amount available from the trust account, net of amounts needed to satisfy any redemption by public shareholders, we may be required to seek additional financing to complete such proposed initial business combination. Such additional financing may be in the form of a private investment in a public entity ( PIPE ), which may be in the form of an equity, debt or convertible debt transactions. These financing transactions would be designed to ensure a return on investment to the investor in exchange for assisting the company in completing the business combination or providing sufficient liquidity to the post-combination company. The price of the shares we issue may therefore be less, and potentially significantly less, than the market price for our shares at such time. Any such issuances of equity securities could dilute the interests of our existing shareholders. These financing transactions may be significantly dilutive to the post-combination company, and represent the type of financing risk that is not associated with traditional initial public offerings. We cannot assure you that financing will be available to us on acceptable terms, if at all. None of our initial shareholders, directors or officers or their affiliates or designees are obligated to provide any such financing to us. To the extent that additional financing proves to be unavailable when needed to complete our initial business combination, we would be compelled to either restructure the transaction or abandon that particular business combination and seek an alternative target business candidate.
+In addition, even if we do not need additional financing to complete our initial business combination, we may require such financing to fund the operations or growth of the target business. The failure to secure additional financing could have a material adverse effect on the continued development or growth of the target business. None of our directors, officers or shareholders is required to provide any financing to us in connection with or after our initial business combination.
+Potential Legal and Operational Risks Related to China
+Although we currently do not have a PRC subsidiary or China operations, certain of our officers and directors are located outside the United States of America including our directors, Chief Executive Officer and Chief Financial Officers are located in China, which may make us a less attractive partner to potential target companies outside the PRC than a non-PRC related SPAC. There may be difficulties in effecting service of legal process, enforcing foreign judgments or bringing actions in China against us based on foreign laws. In addition, there is uncertainty as to whether the courts of the PRC would recognize or enforce judgments of U.S. courts against the officers and directors predicated upon the civil liability provisions of the securities laws of the United States of America or any state. The recognition and enforcement of foreign judgments are provided for under the PRC Civil Procedures Law. PRC courts may recognize and enforce foreign judgments in accordance with the requirements of the PRC Civil Procedures Law based either on treaties between China and the country where the judgment is made or on principles of reciprocity between jurisdictions. China does not have any treaties or other forms of written arrangement with the United States of America that provide for the reciprocal recognition and enforcement of foreign judgments. In addition, according to the PRC Civil Procedures Law, the PRC courts will not enforce a foreign judgment by us against the officers or directors or the future combined company if they decide that the judgment violates the basic principles of PRC laws or national sovereignty, security, or the public interest. As a result, it is uncertain whether and on what basis a PRC court would enforce a judgment rendered by a court in the United States of America. No PRC legal counsel has been retained for purpose of this offering and consequently the company did not rely on the advice of PRC counsel. The above discussion is based on our management s understanding of the current PRC laws, rules, regulations and local market practices and we cannot assure you that our management s understanding is correct. If we begin our business combination process with a China-based target, we expect to retain a PRC legal counsel who will advise us and provide its opinion of counsel relating to the enforceability of civil liabilities and we cannot assure you 
+
+16
+
+Table of Contents
+
+that the PRC legal counsel will reach the same conclusion as our management s assessment above. Furthermore, there would be added costs and issues with bringing an original action in foreign courts against the combined company or the officers and directors to enforce liabilities based upon the U.S. Federal securities laws, and they still may be fruitless.
+Pursuant to the Holding Foreign Companies Accountable Act, or the HFCAA, the PCAOB issued a Determination Report on December 16, 2021 which found that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in (1) mainland China of the PRC because of a position taken by one or more authorities in mainland China and (2) Hong Kong, a Special Administrative Region and dependency of the PRC, because of a position taken by one or more authorities in Hong Kong. In addition, the PCAOB s report identified the specific registered public accounting firms which are subject to these determinations. On December 15, 2022, the PCAOB announced that PCAOB has secured complete access to inspect and investigate public accounting firms headquartered in mainland China and Hong Kong, and vacated previous determinations to the contrary. However, uncertainties exist with respect to the implementation of this framework and there is no assurance that the PCAOB will be able to execute, in a timely manner, its future inspections and investigations in a manner that satisfies the Protocol. Should PRC authorities obstruct or otherwise fail to facilitate the PCAOB s access in any way and at any point in the future the Board of PCAOB will act immediately to consider the need to issue a new determination. Our auditor, CBIZ CPAs P.C., is a national CPA founded and headquartered in Kansas City, Missouri, and is subject to regular inspection by the PCAOB. CBIZ CPAs P.C. is not headquartered in mainland China or Hong Kong and was not identified in the Determination Report as a firm subject to the PCAOB s determinations. As a special purpose acquisition company, our current business activities only involve preparation of this offering and will involve searching for targets and consummation of a business combination following this offering.
+Potential Approvals from the PRC Governmental Authorities for this Offering or a Business Combination
+Potential Approvals from the PRC Governmental Authorities for this Offering
+Based on our understanding of the current PRC laws and regulations, no prior permission is required under the rules and regulations listed above from any PRC governmental authorities (including the CSRC) for consummating this offering by our company, given that: (a) the CSRC currently has not issued any definitive rule or interpretation concerning whether offerings like ours under this prospectus are subject to the M&A Rules; (b) our company is a blank check company newly incorporated in the Cayman Islands rather than in China, and currently, the company conducts no business in China, and (c) our sponsor, is a company incorporated in the British Virgin Islands, rather than China and currently the sponsor conducts no business in China.
+We do not believe that we require any approval from PRC governmental authorities for this offering, including, but not limited to, those permission requirements of the CSRC, Cyberspace Administration of China (the CAC ), notwithstanding that a majority of our officers and directors have ties to China. Accordingly, we have not applied for (or been denied) any permissions by any PRC governmental authorities. If the CSRC or another PRC governmental authority subsequently determines that its approval is needed for this offering, we may face approval delays, adverse actions, or sanctions by the CSRC or other PRC governmental authorities.
+However, there can be no assurance that the relevant PRC governmental authorities, including the CSRC, would reach the same conclusion as us, or that the CSRC or any other PRC governmental authorities would not promulgate new rules or new interpretations of current rules which would require us to obtain CSRC or other PRC governmental approvals for this offering. If the CSRC or another PRC governmental authority subsequently determines that its approval is needed for this offering, we may face approval delays, adverse actions, or sanctions by the CSRC or other PRC governmental authorities.
+In any such event, complying with the requirements of the above-mentioned regulations and other relevant rules and any required approval processes with PRC governmental authorities could be time-consuming and may delay this offering or a potential business combination. These governmental authorities may impose fines and penalties, limit our operations in China, or take other actions that could materially adversely affect our business, financial condition, results of operations, reputation and prospects, as well as significantly limit or significantly hinder our ability to offer or continue to offer securities to investors and cause the value of our securities to significantly decline or be worthless, if we fail to comply with the above-mentioned regulations or other relevant rules. No PRC legal counsel has been retained for purpose of this offering and consequently the company did not rely on the advice of PRC counsel. The above discussion is based on our management s understanding of the current PRC laws, rules, regulations and local market practices and we cannot assure you that our management s understanding is correct. We have been closely monitoring regulatory developments in China regarding any necessary approvals from the CSRC or other PRC governmental authorities required for overseas listings, including this offering and a potential business combination with a target business based in and primarily operating in China. As of the 
+
+17
+
+Table of Contents
+
+date of this prospectus, we have not received any inquiry, notice, warning, sanctions or regulatory objection to this offering from the CSRC or other PRC governmental authorities. However, we cannot guarantee that PRC authorities will not initiate any change in its law, rules or regulations, or governmental policies that would require permission or scrutiny from relevant PRC authorities before our listing; or any law, regulation, rules and policies will become effective and enforceable after our listing that could substantially affect our operations and the value of our securities, which may depreciate quickly and even become worthless. Such future administrative measure or actions may have material adverse effect on the offering of our securities to investors, and our proposed listing in the U.S., our business operations. For example, in the event that we are required to obtain permission from the Chinese government to offer our securities to investors or list on a U.S. exchange, it is unpredictable whether such permission can be obtained by us, as the case may be, or, if permission is obtained, whether it could be later denied or rescinded. If we, including our directors and officers, do not receive or maintain such permissions or approvals, or inadvertently conclude that such permissions or approvals are not required, it could significantly limit or completely hinder our ability to offer or continue to offer our securities to investors, list in the U.S. and cause the value of our securities to significantly decline or become worthless.
+Potential Approvals from the PRC Governmental Authorities for the Business Combination
+We are not limited to a particular industry or geographic region for purposes of consummating an initial business combination. Though we currently do not have any PRC subsidiary or China operations, we may consummate our initial business combination with a target with principal operations in China (excluding any target company the financial statements of which are audited by an accounting firm identified by the PCAOB in the Determination Report, or that the PCAOB has been unable to inspect for two consecutive years and be subject to certain legal and operational risks associated with its operations in the PRC.
+The Regulations on Mergers and Acquisitions of Domestic Companies by Foreign Investors (the M&A Rules ), adopted by six PRC regulatory agencies in 2006, and amended in 2009, require an offshore special purpose vehicle formed for the purpose of an overseas listing of securities in a PRC company to obtain the approval of the CSRC prior to the listing and trading of such special purpose vehicle s securities on an overseas stock exchange. The scope of the M&A Rules covers two types of transactions: (a) equity deals where the acquisition by a foreign investor, i.e., the offshore special purpose vehicle, of equity in a PRC domestic company, and (b) asset deals where the acquisition by an offshore special purpose vehicle of the assets of a PRC domestic company. Neither the equity deals or the asset deals will be involved in our business combination process with a China-based target for the reason that the offshore special purpose vehicle of such China-based target directly holds shares through the wholly foreign owned enterprise(s) or WFOE, which are established by means of direct investment rather than by equity deals or asset deals under the M&A Rules. To date, the CSRC has not issued any definitive rules or interpretations concerning whether offerings such as the indirect listing of a China-based entity as part of the business combination are subject to the CSRC approval procedures under the M&A Rules. As a result, based on our management s understanding of the current PRC laws, rules, regulations and local market practices, the CSRC s approval under the M&A Rules will not be required in the context of our business combination with a China-based target. However, substantial uncertainty remains regarding the scope and applicability of the M&A Rules to offshore special purpose vehicles and the above analysis are subject to any new laws, rules and regulations or detailed implementation and interpretations in any form relating to the M&A Rules. We cannot assure you that relevant PRC governmental agencies, including the CSRC, would reach the same conclusion as we do. It is possible that we may need to obtain approvals or permissions from CSRC in order for us to complete a business combination with a China-based target pursuant to the M&A Rules. If we are required to obtain such approvals, we cannot assure we will be able to receive them in a timely manner, or at all.
+In addition, on December 24, 2021, the CSRC released for public comments Provisions of the State Council on the Administration of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) and Administrative Measures for the Filing of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) (the Draft Rules ). The Draft Rules, if declared into effect, will implement a new regulatory framework requiring Chinese businesses to file with CSRC when pursuing overseas listings. The Draft Rules propose a new filing system for all Chinese companies (including the VIE- structured companies) that are pursuing listings outside mainland China. An overseas listing is required to be filed with CSRC within three working days (i) following the submission of IPO application in the case of an IPO (or similar application in the case of a dual listing on another market), or (ii) following the submission of offering/registration applications (or following the first announcement of the transaction, as applicable) in the case of a SPAC listing or back-door listing. It is our management s understanding that the Draft Rules, if enacted as it is, will subject a China-based target to the new filing system if we decide to consummate our initial business combination with such target. The China-based target and the combined company may be subject to additional compliance requirements in the future if a final rule is adopted with material changes from the Draft Rules. Though we believe that none of the situations that would clearly prohibit overseas 
+
+18
+
+Table of Contents
+
+listing and offering applies to us, we cannot assure you that we will be able to receive clearance of such filing requirements in a timely manner, or at all.
+On December 27, 2021, the National Development and Reform Commission (the NDRC ) and the Ministry of Commerce (the MOFCOM ) promulgated Special Administrative Measures (Negative List) for the Access of Foreign Investment (2021 Version), effective as of January 1, 2022 (the Negative List ). Compared to the previous version, there are no specific industries added to the list but, for the first time, it declares China s jurisdiction over (and detailed regulatory requirements on) overseas listings made by Chinese businesses in the so-called Prohibited Industries. According to Article 6 of the Negative List, domestic enterprises engaging in businesses in which foreign investment is prohibited shall obtain approval from the relevant authorities before offering and listing their shares on an overseas stock exchange. In addition, certain foreign investors shall not be involved in the operation or management of the relevant enterprise, and shareholding percentage restrictions under relevant domestic securities investment management regulations shall apply to such foreign investors. The intended scope of such jurisdiction was further clarified by NDRC officials on a press conference held on January 18, 2022.
+On July 6, 2021, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointly issued the Opinions on Strictly Cracking Down on Illegal Securities Activities According to Law (the Opinions ), which call for strengthened regulation over illegal securities activities and supervision on overseas listings by China-based companies and propose to take effective measures, such as promoting the development of relevant regulatory systems to deal with the risks and incidents faced by China-based overseas-listed companies.
+Uncertainties still exist as to how the M&A Rules could be interpreted or implemented in the future, and the Opinions stated above are subject to any new laws, rules and regulations or detailed implementations and interpretations in any form relating to the M&A Rules.
+Furthermore, pursuant to the PRC Cybersecurity Law, which was promulgated by the Standing Committee of the National People s Congress on November 7, 2016 and took effect on June 1, 2017, personal information and important data collected and generated by a critical information infrastructure operator in the course of its operations in China must be stored in China, and if a critical information infrastructure operator purchases internet products and services that affects or may affect national security, it should be subject to cybersecurity review by the CAC. In April 2020, the CAC and certain other PRC regulatory authorities promulgated the Measures for Cybersecurity Review, which requires that operators of critical information infrastructure must pass a cybersecurity review when purchasing network products and services which do or may affect national security. On January 4, 2022, the CAC, in conjunction with 12 other government departments issued the New Measures for Cybersecurity Review (the New Measures ). The New Measures amends the Measures for cybersecurity Review (Draft Revision for Comments) (the )Draft Measures ) released on July 10, 2021 and came into effect on February 15, 2022. The New Measures include data processing activities of network platform operators that affect or may affect national security into cybersecurity review and clarify that network platform operators with personal information of more than one million users must apply for cybersecurity review to the Cybersecurity Review Office when they go public abroad. The PRC Data Security Law, which took effect on September 1, 2021, imposes data security and privacy obligations on entities and individuals that carry out data activities, provides for a national security review procedure for data activities that may affect national security and imposes export restrictions on certain data and information. On August 20, 2021, the Standing Committee of the People s Congress promulgated the PRC Personal Information Protection Law (the PIPL ), which is to take effect on November 1, 2021. The PIPL sets out the regulatory framework for the handling and protection of personal information and the transmission of personal information overseas. If our potential future target business in China involves collecting and retaining internal or customer data, it is our management s understanding that such target business might be subject to the relevant cybersecurity laws and regulations, including the PRC Cybersecurity Law and the PIPL as discussed above, and that such target business needs to go through the cybersecurity review process before effecting a business combination if it is deemed as a critical information infrastructure operator purchasing internet products and services that affects or may affect national security, a network platform operator that affect or may affect national security, or a network platform operator with personal information of more than one million users. Since the New Measures is new, the implementation and interpretation thereof are not yet clear.
+No PRC legal counsel has been retained for purpose of this offering and consequently the Company did not rely on the advice of PRC counsel. The above discussion is based on our management s understanding of the current PRC laws, rules, regulations and local market practices and we cannot assure you that our management s understanding is correct. If we engage in our business combination process with a China-based target, we expect to retain legal experts in the PRC and the U.S. that are experienced with structuring offshore transactions with U.S. public companies. Additionally, we expect that the PRC legal expert will advise us and provide its opinion of counsel relating to the approvals from the PRC Governmental Authorities for the business combination and we cannot assure you that 
+
+19
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+Table of Contents
+
+the PRC legal counsel will reach the same conclusion as our management s assessment above. We plan to consult with PRC government officials when possible to assist us with complying with these structuring considerations and changing developments. As of the date of this prospectus, we and our directors and officers have not received any inquiry, notice, warning, sanctions or regulatory objection to this offering from the CSRC, CAC, or any other PRC governmental authorities, nor received any objection, restriction, or were denied approval from Chinese authorities to list our securities on a U.S. exchange. However, we cannot guarantee that PRC authorities will not initiate any change in its law, rules or regulations, or governmental policies that would require permission or scrutiny from relevant PRC authorities before our listing; or any law, regulation, rules and policies will become effective and enforceable after our listing that could substantially affect our operations and the value of our securities, which may depreciate quickly and even become worthless. Such future administrative measure or actions may have material adverse effects on the offering of our securities to investors, our proposed listing in the U.S., and our business operation. For example, in the event that we are required to obtain permission from the Chinese government to offer our securities to investors or list on a U.S. exchange, it is unpredictable whether such permission can be obtained by us, as the case may be, or, if permission is obtained, whether it could be later denied or rescinded. If we, including our directors and officers, do not receive or maintain such permissions or approvals, or inadvertently conclude that such permissions or approvals are not required, it could significantly limit or completely hinder our ability to offer or continue to offer our securities to investors, list in the U.S. and cause the value of our securities to significantly decline or become worthless.
+Corporate Information
+Our principal executive office is located at Unit 901, 9/F, China Huarong Tower, 60 Gloucester Road, Wanchai, Hong Kong, and our telephone number is +852 6066 3705.
+The Offering
+In making your decision whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors beginning on page 38 of this prospectus.
+ 
+ 
+
+ 
+
+ 
+
+Securities offered
+ 
+6,000,000 units, at $10.00 per unit, each unit consisting of one Class A ordinary share and one right. Each right entitles the holder thereof to receive one-seventh (1/7) of one Class A ordinary share upon consummation of our initial business combination, as described in more detail in this prospectus.
+
+ 
+ 
+ 
+
+Listing of our securities and symbols
+ 
+The units, the Class A ordinary shares and rights once they begin separate trading, (as described below) are expected to be listed on Nasdaq under the symbols CAEAU, CAEA and CAEDR, respectively.
+
+ 
+ 
+ 
+
+Trading commencement and separation of Class A ordinary shares and rights
+ 
+The units are expected to begin trading on or promptly after the date of this prospectus. Each of the Class A ordinary shares and rights comprising the units are expected to begin separate trading on the 52nd business day following the date of this prospectus unless Maxim informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin.
+
+ 
+ 
+ 
+
+ 
+ 
+Once the Class A ordinary shares and rights commence separate trading, holders will have the option to continue to hold units or separate their units into the component pieces. Holders will need to have their brokers contact our transfer agent in order to separate the units into Class A ordinary shares and rights.
+
+ 
+ 
+ 
+
+ 
+ 
+In no event will the Class A ordinary shares and rights be traded separately until we have filed a Current Report on Form 8-K with the SEC containing an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering, which is anticipated 
+
+20
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+Table of Contents
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+to take place on the second business day after the date the units commence trading. If the underwriters over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to disclose the exercise of the underwriters over-allotment option. We will also include in the Form 8-K, or amendment thereto, or in a subsequent Form 8-K, information indicating if Maxim has allowed separate trading of the Class A ordinary shares and rights prior to the 52nd business day after the date of this prospectus.
+
+ 
+ 
+ 
+
+Units:
+ 
+ 
+
+ 
+ 
+ 
+
+Number outstanding before this offering and the private placement
+ 
+0 units
+
+ 
+ 
+ 
+
+Number outstanding after this offering and the private placement
+ 
+6,200,000 units(1)
+
+ 
+ 
+ 
+
+Ordinary shares:
+ 
+ 
+
+ 
+ 
+ 
+
+Number issued and outstanding before this offering and the private placement
+ 
+1,725,000 shares(2)
+
+ 
+ 
+ 
+
+Number to be issued and outstanding after this offering and the private placement
+ 
+7,880,000 shares(1)(3)
+
+ 
+ 
+ 
+
+Rights:
+ 
+ 
+
+ 
+ 
+ 
+
+Number issued and outstanding whole rights before this offering and the private placement
+ 
+0 rights
+
+ 
+ 
+ 
+
+Number of outstanding whole rights after this offering and the private placement
+ 
+6,200,000 rights(1)
+
+ 
+ 
+ 
+
+Terms of rights
+ 
+Except in cases where we are not the surviving company in a business combination, each holder of a right will automatically receive one-seventh (1/7) of one Class A ordinary share upon consummation of our initial business combination. We will not issue fractional shares in connection with an exchange of rights. Fractional shares will either be rounded down to the nearest whole share or otherwise addressed in accordance with the applicable provisions of Cayman law. As a result, you must hold rights in multiples of seven in order to receive shares for all of your rights upon closing of a business combination. In the event we will not be the surviving company upon completion of our initial business combination, each holder of a right will be required to affirmatively convert his, her or its rights in order to receive the one-seventh (1/7) of one Class A ordinary share underlying each right upon consummation of the business combination. If we are unable to complete an initial business combination within the required time period and we redeem the public shares for the funds held in the trust account, holders of rights will not receive any of such funds for their rights and the rights will expire worthless.
+
+(1)Assumes no exercise of the underwriters over-allotment option. Our sponsor has agreed to purchase an aggregate of 200,000 private units (or 210,000 private units if the over-allotment option is exercised in full) at a price of $10.00 per unit, for a purchase price of $2,000,000 (or $2,100,000 if the over-allotment option is exercised in full). Each private unit will be identical to the units sold in this offering, except as described in this prospectus.
+
+21
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+Table of Contents
+
+(2)Represents 1,725,000 founder shares, including an aggregate of up to 225,000 founder shares that are subject to forfeiture if the over-allotment option is not exercised by the underwriters in full.
+(3)Comprised of 6,200,000 Class A ordinary shares (including 200,000 private shares), 1,500,000 founder shares and 180,000 representative shares, assuming no exercise of the underwriters over-allotment option.
+
+ 
+Prior issuance of founder shares
+ 
+On May 31, 2025, our sponsor acquired 1,725,000 founder shares for an aggregate purchase price of $25,000, or approximately $0.0145 per share. The per share purchase price of the founder shares was determined by dividing the amount of cash contributed to the company by the aggregate number of founder shares issued. As of date of this prospectus, there were 1,425,000 Class B ordinary shares issued to our sponsor and 300,000 Class B ordinary shares held by our director and Chief Executive Officer. Prior to this offering, our sponsor has transferred an aggregate of 300,000 of its founder shares to our Chief Executive Officer and director, all for nominal cash consideration. The number of founder shares issued was determined based on the expectation that the founder shares would represent approximately 20% of the issued and outstanding ordinary shares after this offering (not including the Class A ordinary shares issuable underlying the private units and the representative shares, any shares underlying units issued upon conversion of working capital loans and any Class A ordinary shares or equity-linked securities issued, or to be issued, to any seller in our initial business combination). As such, our initial shareholders will collectively own approximately 20% of our issued and outstanding shares after this offering (assuming they do not purchase any units in this offering and excluding private shares and representative shares). Except as provided with regard to the private placement discussed herein, neither our sponsor nor any of our officers or directors have expressed an intention to purchase any units in this offering. Up to 225,000 founder shares will be subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised so that our initial shareholders will maintain ownership of approximately 20% of our Class A ordinary shares after this offering (assuming they do not purchase any units in this offering and excluding the private shares and representative shares). We will effect a share capitalization or a share repurchase or other appropriate mechanism, as applicable, with respect to our Class A ordinary shares prior to this offering should the size of the offering change, in order to maintain such ownership percentage.
+
+ 
+ 
+ 
+
+ 
+ 
+The founder shares are identical to the Class A ordinary shares included in the units being sold in this offering, except that:
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+only holders of the founder shares have the right to vote on the election of directors prior to our initial business combination;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+the founder shares are Class B ordinary shares that automatically convert into Class A ordinary shares at the time of our initial business combination, or at any time prior thereto at the option of the holder, on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described herein, for no additional consideration;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+the founder shares are subject to certain transfer restrictions, as described in more detail below;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+our sponsor, officers and directors have entered into a letter agreement, pursuant to which they have agreed (A) to waive their redemption rights with respect to their founder shares, private shares and public shares in connection with the completion of our initial business combination and (B) to waive their rights to liquidating distributions from the trust account with respect to their founder shares and private placement shares if we fail to complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of 
+
+22
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+Table of Contents
+
+time to consummate a business combination by the full amount of time) (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame); and (C) to waive their redemption to liquidation distributions from the trust account with respect to their founder shares and private placement shares in connection with a shareholder vote to approve an amendment to our second amended and restated articles of association (a) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months if we extend the period of time to consummate a business combination, as described in more detail in this prospectus) or (b) with respect to any other provision relating to shareholders rights or pre-initial business combination activity; and
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+the founder shares are entitled to registration rights.
+
+ 
+ 
+ 
+
+Private units and underlying securities
+ 
+Our sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 200,000 private units (or up to 210,000 private units if the underwriters exercise their over-allotment option in full), at a price of $10.00 per unit, $2,000,000 in the aggregate, or up to $2,100,000 if the underwriters exercise their over-allotment option in full, in a private placement that will occur simultaneously with the closing of this offering. The private units will be identical to the units sold in this offering, except as described in this prospectus. A portion of the purchase price of the private units will be added to the proceeds from this offering to be held in the trust account such that at the time of closing, $60,000,000 (or $69,000,000 if the underwriters exercise their over- allotment option in full) will be held in the trust account. If we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination, as described in more detail in this prospectus), the proceeds from the sale of the private units held in the trust account will be used to fund the redemption of our public shares (subject to the requirements of applicable law) and the private units will expire worthless.
+
+ 
+ 
+ 
+
+ 
+ 
+Our sponsor has agreed to waive its redemption rights with respect to its private shares (i) in connection with the consummation of a business combination, (ii) in connection with a shareholder vote to amend our second amended and restated memorandum and articles of association to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months after the closing of this offering (or up to 18 months from the completion of this offering if we extend the period of time to consummate a business combination by the full amount of time), and (iii) if we fail to consummate a business combination within 12 months after the closing of this offering (or up to 18 months from the completion of this offering if we extend the period of time to consummate a business combination by the full amount of time) or if we liquidate prior to the expiration of the 12-month period (or up to 18 months from the completion of this offering if we extend the period of time to consummate a business combination by the full amount of time). However, our sponsor will be entitled to redemption rights with respect to any public shares held by it if we fail to consummate a business combination or liquidate within the 12-month period (or up to 18 months if we extend the period of time to consummate a business combination by the full amount of time).
+
+ 
+ 
+ 
+
+ 
+ 
+Our sponsor has agreed not to transfer, sell or assign the private units and the underlying securities until the consummation of our initial business combination, subject to exceptions as discussed herein.
+
+ 
+ 
+ 
+
+23
+
+Table of Contents
+
+Transfer restrictions on founder shares
+ 
+Our initial shareholders have agreed that, with limited exceptions, the founder shares will not to be transferred, assigned, or sold until the earlier of (1) six months after the completion of our initial business combination and (2) the date on which we consummate a liquidation, merger, share exchange, reorganization, or other similar transaction after our initial business combination that results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property, unless otherwise approved by public shareholders in connection with a business combination; unless different transfer restrictions are otherwise approved by public shareholders in connection with the business combination. Notwithstanding the foregoing, if the last sale price of our Class A ordinary shares equals or exceeds $12.50 per share (as adjusted for share subdivisions, share capitalizations, rights issuances, subdivisions, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period beginning 150 days after our initial business combination, the founder shares will be released from the lock-up. However, if after a business combination, there is a transaction whereby all the outstanding shares are exchanged or redeemed for cash (as would be the case in a post-asset sale liquidation) or another issuer s shares, then the founder shares or private units (or any securities thereunder) shall be permitted to come out of the transfer restrictions to participate.
+
+ 
+ 
+ 
+
+Conversion and anti-dilution rights of founder shares
+ 
+The Class B ordinary shares will automatically convert into our Class A ordinary shares at the time of our initial business combination on a one-for-one basis, subject to adjustment for share sub-divisions, share dividends, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein, for no additional consideration. In the case that additional Class A ordinary shares, or equity-linked securities, are issued or deemed issued in excess of the amounts offered in this prospectus and related to the closing of the initial business combination, the ratio at which Class B ordinary shares shall convert into Class A ordinary shares will be adjusted (unless the holders of a majority of the outstanding Class B ordinary shares agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of Class A ordinary shares issuable upon conversion of all Class B ordinary shares will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all ordinary shares outstanding upon the completion of this offering (excluding the representative shares), plus all Class A ordinary shares and equity-linked securities issued or deemed issued in connection with the initial business combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in the initial business combination or any private placement-equivalent units issued to our sponsor, its affiliates or certain of our officers and directors upon conversion of working capital loans made to us). Holders of founder shares may also elect to convert their Class B ordinary shares into an equal number of Class A ordinary shares, subject to adjustment as provided above, at any time. The term equity-linked securities refers to any debt or equity securities that are convertible, exercisable or exchangeable for Class A ordinary shares issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt. Securities could be deemed issued for purposes of the conversion rate adjustment if such shares are issuable upon the conversion or exercise of convertible securities, warrants or similar securities.
+
+ 
+ 
+ 
+
+Representative shares
+ 
+We have agreed to issue to Maxim and/or its designees 180,000 Class A ordinary shares (or up to 207,000 Class A ordinary shares if the underwriters over-allotment option is exercised in full) upon the consummation of this offering. These shares are being registered in the registration statement of which this prospectus forms a part. Maxim has agreed not to transfer, assign or sell any such shares without prior consent of the Company until the completion of our initial business combination. In addition, Maxim has agreed (i) to waive its redemption rights with respect to such shares in connection with the completion of our initial business combination and (ii) to waive its rights to liquidating distributions from the trust account with respect to such shares if we fail to complete our initial business combination within the periods of time as provided in our second amended and restated memorandum and articles of association.
+
+24
+
+Table of Contents
+
+ 
+ 
+ 
+
+Offering proceeds to be held in trust
+ 
+Net proceeds of $60,000,000 (or $69,000,000 if the over-allotment option is exercised in full) from this offering and the proceeds we will receive from the sale of the private units, or $10.00 per unit sold to the public in this offering (regardless of whether or not the over-allotment option is exercised) (which amount is less expenses of the offering plus the contributed value of the private units) will be placed in a United States-based trust account maintained by Continental Stock Transfer & Trust Company, acting as trustee pursuant to an agreement to be signed on the date of this prospectus. Except as set forth below, the proceeds held in the trust account will not be released until the earlier of the completion of an initial business combination and our redemption of 100% of the outstanding public shares if we have not completed a business combination in the required time period. Therefore, except as set forth below, unless and until an initial business combination is consummated, the proceeds held in the trust account will not be available for our use for any expenses related to this offering or expenses which we may incur related to the investigation and selection of a target business and the negotiation of an agreement to acquire a target business.
+
+ 
+ 
+ 
+
+ 
+ 
+Notwithstanding the foregoing, there can be released to us from the trust account any interest earned on the funds in the trust account that we need to pay our income or other tax obligations, and, if applicable, up to $50,000 of interest to pay liquidation expenses (which interest shall be net of income taxes payable). Aside from these exceptions, expenses incurred by us may be paid prior to a business combination only from the net proceeds of this offering not held in the trust account. Additionally, in order to meet our working capital needs following the consummation of this offering until completion of an initial business combination, our founders, officers and directors or their affiliates or designees may, but are not obligated to, loan us funds, from time to time or at any time, in whatever amount they deem reasonable in their sole discretion. Each loan would be evidenced by a promissory note. The notes would either be paid upon consummation of our initial business combination, without interest, or, at the holder s discretion, up to $2,500,000 of the notes may be converted into units at a price of $10.00 per unit, in addition to the convertible notes in connection with the potential extensions. These units would be identical to the private units. In the event that the initial business combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts, but no proceeds from our trust account would be used for such repayment.
+
+ 
+ 
+ 
+
+Ability to extend time to complete business combination
+ 
+We will have until 12 months from the closing of this offering to consummate an initial business combination. However, if we anticipate that we may not be able to consummate our initial business combination within 12 months, we may extend the period of time to consummate a business combination up to two times, each by an additional three months (for a total of up to 18 months to complete a business combination) without submitting such proposed extensions to our shareholders for approval or offering our public shareholders redemption rights in connection therewith. Pursuant to the terms of our memorandum and articles of association and the trust agreement between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order to extend the time available for us to consummate our initial business combination, our sponsor or its affiliates or designees, upon five days advance notice prior to the applicable deadline, must deposit an aggregate of $600,000, or up to $690,000 if the underwriters over-allotment option is exercised in full ($0.10 per public share in either case), on or prior to the date of the applicable deadline, for each three-month extension (or up to an aggregate of $1,200,000 (or $1,380,000 if the underwriters over-allotment option is exercised in full), or $0.20 per public share then issued and outstanding if we extend for the full six months). Any such payments would be made in the form of a loan. Any such loans will be non-interest bearing and either be payable upon the consummation of our initial business combination, or, at the lender s discretion, converted upon consummation of our business combination into additional private units at a price of $10.00 per unit. Our sponsor and its affiliates or designees are not obligated to fund the trust account to extend the time for us to complete our initial business combination.
+
+25
+
+Table of Contents
+
+ 
+ 
+ 
+
+Anticipated expenses and funding sources
+ 
+Except as described above with respect to the payment of taxes, unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. The proceeds held in the trust account will be invested only in U.S. government securities with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations or in an interest bearing or non-interest bearing demand deposit account. We will disclose in each quarterly and annual report filed with the SEC prior to our initial business combination whether the proceeds deposited in the trust account are invested in U.S. government treasury obligations, an interest bearing or non-interest bearing demand deposit account or money market funds or a combination thereof. Based upon current interest rates, we expect the trust account to generate approximately $2.1 million of interest annually assuming an interest rate of 3.5% per year; however, we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from:
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+the net proceeds of this offering and the sale of the private units not held in the trust account, which will be approximately $500,000 in working capital after the payment of approximately $900,000 in expenses (not including underwriting discount) relating to this offering; and any loans or additional investments from our sponsor, members of our management team or their affiliates or designees, although they are under no obligation to advance funds or invest in us, and provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of an initial business combination.
+
+ 
+ 
+ 
+
+Conditions to completing our initial business combination
+ 
+There is no limitation on our ability to raise funds privately or through loans in connection with our initial business combination. Nasdaq rules require that our initial business combination must be with one or more target businesses that together have an aggregate fair market value equal to at least 80% of the balance in the trust account (less any taxes payable on interest earned) at the time of our signing a definitive agreement in connection with our initial business combination. We do not intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination.
+
+ 
+ 
+ 
+
+ 
+ 
+If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm or another independent firm that commonly renders valuation opinions for the type of company we are seeking to acquire or an independent accounting firm. We will complete our initial business combination only if the post-transaction company in which our public shareholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our initial business combination transaction.
+
+ 
+ 
+ 
+
+ 
+ 
+If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post- transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test, provided that in the event that our initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses.
+
+ 
+ 
+ 
+
+26
+
+Table of Contents
+
+Permitted purchases of public shares and public rights by our affiliates
+ 
+If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, directors, officers, advisors or their affiliates may purchase shares in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Please see Proposed Business Permitted purchases of our securities for a description of how such persons will determine which shareholders to seek to acquire shares from. There is no limit on the number of shares such persons may purchase, or any restriction on the price that they may pay. Any such price per share may be different than the amount per share a public shareholder would receive if it elected to redeem its shares in connection with our initial business combination. However, such persons have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. In the event our sponsor, directors, officers, advisors or their affiliates determine to make any such purchases at the time of a shareholder vote relating to our initial business combination, such purchases could have the effect of influencing the vote necessary to approve such transaction. None of the funds in the trust account will be used to purchase shares in such transactions. If they engage in such transactions, they will not make any such purchases when they are in possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. Subsequent to the consummation of this offering, we will adopt an insider trading policy which will require insiders to: (i) refrain from purchasing shares during certain blackout periods and when they are in possession of any material non-public information and (ii) to clear all trades with our legal counsel prior to execution. We cannot currently determine whether our insiders will make such purchases pursuant to a Rule 10b5-1 plan, as it will be dependent upon several factors, including but not limited to, the timing and size of such purchases. Depending on such circumstances, our insiders may either make such purchases pursuant to a Rule 10b5-1 plan or determine that such a plan is not necessary.
+
+ 
+ 
+ 
+
+ 
+ 
+We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going- private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Our sponsor, directors, officers, advisors or their affiliates will not make any purchases if the purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act.
+
+ 
+ 
+ 
+
+ 
+ 
+In addition, if such purchases are made, the public float of our securities may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. Additionally, in the event our sponsor, initial shareholders, directors, officers, advisors and their affiliates were to purchase public shares from public shareholders after the announcement of our initial business combination, such purchases would be structured in compliance with the requirements of Rule 14e-5 under the Exchange Act including, in pertinent part, through adherence to the following:
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+our registration statement/proxy statement filed for our business combination transaction would disclose the possibility that our sponsor, initial shareholders, directors, officers, advisors and their affiliates may purchase public shares from public shareholders outside the redemption process, along with the purpose of such purchases;
+
+ 
+ 
+ 
+
+27
+
+Table of Contents
+
+ 
+ 
+ 
+if our sponsor, initial shareholders, directors, officers, advisors and their affiliates were to purchase public shares from public shareholders, they would do so at a price no higher than the price offered through our redemption process;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+our registration statement/proxy statement filed for our business combination transaction would include a representation that any of our securities purchased by our sponsor, initial shareholders, directors, officers, advisors and their affiliates would not be voted in favor of approving the business combination transaction;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+our sponsor, initial shareholders, directors, officers, advisors and their affiliates would not possess any redemption rights with respect to our securities or, if they do acquire and possess redemption rights, they would waive such rights; and
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+we would disclose in a Form 8-K, before our security holder meeting to approve the business combination transaction, the following material items:
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+the amount of our securities purchased outside of the redemption offer by our sponsor, initial shareholders, directors, officers, advisors and their affiliates, along with the purchase price;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+the purpose of the purchases by our sponsor, initial shareholders, directors, officers, advisors and their affiliates;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+the impact, if any, of the purchases by our sponsor, initial shareholders, directors, officers, advisors and their affiliates on the likelihood that the business combination transaction will be approved;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+the identities of our security holders who sold to our sponsor, initial shareholders, directors, officers, advisors and their affiliates (if not purchased on the open market) or the nature of our security holders (e.g., 5% security holders) who sold to our sponsor, initial shareholders, directors, officers, advisors and their affiliates; and
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+the number of our securities for which we have received redemption requests pursuant to our redemption offer.
+
+ 
+ 
+ 
+
+ 
+ 
+To the extent such securities are purchased, such public securities will not be voted as required by Tender Offers and Schedules Compliance and Disclosure Interpretations Question 166.01 promulgated by the SEC. See Proposed Business Permitted purchases and other transactions with respect to our securities for a description of how our sponsor, directors, officers, advisors or any of their affiliates will select which shareholders to enter into private transactions with.
+
+ 
+ 
+ 
+
+Redemption rights for public shareholders upon completion of our initial business combination
+ 
+We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest (which interest shall be net of income taxes payable) divided by the number of then outstanding public shares, subject to the limitations described herein. 
+
+ 
+ 
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+
+ 
+ 
+
+28
+
+Table of Contents
+
+ 
+ 
+ 
+The amount in the trust account is initially anticipated to be $10.00 per public share (subject to increase of up to an additional $0.20 per public share in the event that our sponsor elects to extend the period of time to consummate a business combination, as described in more detail in this prospectus). There will be no redemption rights upon the completion of our initial business combination with respect to our public rights or private units. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares, private units and any public shares they may acquire during or after this offering in connection with the completion of our initial business combination. 
+
+ 
+ 
+ 
+
+Manner of conducting redemptions
+ 
+We will provide our public shareholders with the opportunity to redeem all or a portion of their public shares upon the completion of our initial business combination either (i) in connection with a shareholder meeting called to approve the business combination or (ii) by means of a tender offer. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under the law or stock exchange listing requirement. Under Nasdaq rules, asset acquisitions and stock purchases would not typically require shareholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our issued and outstanding Class A ordinary shares or seek to amend our second amended and restated memorandum and articles of association would require shareholder approval. We intend to conduct redemptions without a shareholder vote pursuant to the tender offer rules of the SEC unless shareholder approval is required by law or stock exchange listing requirement or we choose to seek shareholder approval for business or other legal reasons. So long as we obtain and maintain a listing for our securities on Nasdaq, we will be required to comply with such rules.
+
+ 
+ 
+ 
+
+ 
+ 
+If a shareholder vote is not required and we do not decide to hold a shareholder vote for business or other legal reasons, we will, pursuant to our second amended and restated memorandum and articles of association:
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies.
+
+ 
+ 
+ 
+
+ 
+ 
+Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we or our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase our ordinary shares in the open market, in order to comply with Rule 14e-5 under the Exchange Act.
+
+ 
+ 
+ 
+
+ 
+ 
+In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, if enough shareholders tender their shares so that we are unable to satisfy any applicable closing condition set forth in the definitive agreement related to our initial business combination, or we are unable to maintain net tangible assets of at least $5,000,001 upon the consummation of initial business combination, we will not consummate such business combination.
+
+29
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+Table of Contents
+
+ 
+ 
+ 
+
+ 
+ 
+If, however, shareholder approval of the transaction is required by law or stock exchange listing requirement, or we decide to obtain shareholder approval for business or other legal reasons, we will:
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+ 
+ 
+ 
+
+ 
+ 
+ 
+conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+file proxy materials with the SEC.
+
+ 
+ 
+ 
+
+ 
+ 
+We expect that a final proxy statement would be distributed to our shareholders at least 20 calendar days prior to the shareholder meeting. However, we expect that a proxy statement would be made available to such shareholders well in advance of such time, providing additional notice of redemption if we conduct redemptions in conjunction with a proxy solicitation. Although we are not required to do so, we currently intend to comply with the substantive and procedural requirements of Regulation 14A in connection with any shareholder vote even if we are not able to maintain our Nasdaq listing or Exchange Act registration.
+
+ 
+ 
+ 
+
+ 
+ 
+If we seek shareholder approval, we will complete our initial business combination only if we obtain the approval of an ordinary resolution under Cayman Islands law and our second amended and restated memorandum and articles. In such case, pursuant to the terms of a letter agreement entered into with us, our sponsor, officers and directors have agreed (and their permitted transferees will agree) to vote any founder shares and private shares held by them and any public shares purchased during or after this offering in favor of our initial business combination. We expect that at the time of any shareholder vote relating to our initial business combination, our initial shareholders and their permitted transferees will own approximately 20% of our issued and outstanding Class A ordinary shares entitled to vote thereon (assuming it does not purchase units in this offering and excluding the private shares and representative shares) or approximately 23.9% (including the private units and the representative shares). If we submit our initial business combination to our public shareholders for a vote, our founders have agreed, pursuant to such letter agreement, to vote their founder shares, private shares and any public shares purchased during or after this offering in favor of our initial business combination. Under Nasdaq listing rule 5635(e)(4), where shareholder approval is required, the minimum vote that will constitute shareholder approval shall be a majority of the total votes cast on the proposal. According to our second amended and restated memorandum and articles of association, one-third of our issued and outstanding Class A ordinary shares entitled to vote at the meeting constitutes a quorum. As a result, in addition to our founder shares and private shares, assuming all the representative shares held by Maxim will be voted for, in order to have our initial business combination approved, (i) we would need only 2,060,001, or 34.3%, of the 6,000,000 public shares sold in this offering to be voted in favor of a transaction (assuming all outstanding shares are voted), or (ii) assuming that only founder shares, private shares, and representative shares are voted for the business combination and no public shares are voted, which means a quorum is present and our business combination can be approved without any vote by public shares (in either case, assuming the over-allotment option is not exercised). Each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against, or abstain from voting on, the proposed transaction.
+
+ 
+ 
+ 
+
+ 
+ 
+We have determined not to consummate any business combination unless we have net tangible assets of at least $5,000,001 upon such consummation in order to avoid being subject to Rule 419 promulgated under the Securities Act. However, if we seek to consummate an initial business combination with a target business that imposes any type of 
+
+30
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+Table of Contents
+
+working capital closing condition or requires us to have a minimum amount of funds available from the trust account upon consummation of such initial business combination, our net tangible asset threshold may limit our ability to consummate such initial business combination (as we may be required to have a lesser number of shares redeemed) and may force us to seek third party financing which may not be available on terms acceptable to us or at all. As a result, we may not be able to consummate such initial business combination and we may not be able to locate another suitable target within the applicable time period, if at all.
+
+ 
+ 
+ 
+
+Tendering share certificates in connection with a tender offer or redemption rights
+ 
+We may require our public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to either tender their certificates (if any) to our transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to such holders in connection with the proposal to approve the initial business combination, or up to two business days prior to the vote on the proposal to approve our initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically using The Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option, rather than simply voting against the initial business combination. The tender offer or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public shareholders to satisfy such delivery requirements.
+
+ 
+ 
+ 
+
+Limitation on redemption rights of shareholders holding 15% or more of the shares sold in this offering if we hold shareholder vote
+ 
+Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our second amended and restated memorandum and articles of association provides that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from seeking redemption rights with respect to more than an aggregate of 15% of the shares sold in this offering. We believe the restriction described above will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our sponsor or its affiliates to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us or our sponsor or its affiliates at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Our sponsor, officers and directors have agreed, pursuant to a letter agreement entered into with us, to waive their right to have any founder shares, private shares or public shares held by them redeemed in connection with our initial business combination. Unless any of our other affiliates acquires founder shares through a permitted transfer from an initial shareholder, and thereby becomes subject to the letter agreement, no such affiliate is subject to this waiver. However, to the extent any such affiliate acquires public shares in this offering or thereafter through open market purchases, it would be a public shareholder and subject to the 15% limitation in connection with any such redemption right.
+
+ 
+ 
+ 
+
+31
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+Table of Contents
+
+Redemption Rights in connection with proposed amendments to our second amended and restated memorandum and articles of association
+ 
+Our second amended and restated memorandum and articles of association provides that any of its provisions, including those related to pre-business combination activity (including the requirement to deposit proceeds of this offering and the private placement into the trust account and not release such amounts except in specified circumstances, and to provide redemption rights to public shareholders as described herein and in our second amended and restated memorandum and articles of association), may be amended if approved by special resolution under Cayman Islands law and our second amended and restated memorandum and articles of association. We may not issue additional securities that can vote on amendments to our second amended and restated memorandum and articles of association or in our initial business combination. Assuming no exercise of the underwriters over- allotment option, our initial shareholders, including our sponsor, which will beneficially own approximately 20% of our Class A ordinary shares upon the closing of this offering (assuming it does not purchase units in this offering and excluding the private shares and representative shares) or approximately 23.9% (including the private shares and the representative shares), will participate in any vote to amend our second amended and restated memorandum and articles of association and/or trust agreement and will have the discretion to vote in any manner it chooses. Our sponsor, officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our second amended and restated memorandum and articles of association that would (i) modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time) or (ii) with respect to the other provisions relating to shareholders rights or pre-business combination activity, unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per- share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, calculated as of two business days prior to the distribution date, including interest (which interest shall be net of income taxes payable) divided by the number of then outstanding public shares. Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to their founder shares, private shares and public shares in connection with the completion of our initial business combination.
+
+ 
+ 
+ 
+
+Release of funds in trust account on closing of our initial business combination
+ 
+On the completion of our initial business combination, all amounts held in the trust account will be released to us, other than funds the trustee will use to pay amounts due to any public shareholders who exercise their redemption rights as described above under Redemption rights for public shareholders upon completion of our initial business combination. We will use the remaining funds to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital.
+
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+32
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+Table of Contents
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+Redemption of public shares and distribution and liquidation if no initial business combination
+ 
+Pursuant to our second amended and restated memorandum and articles of association, we will have only 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time) to complete our initial business combination. If we are unable to complete our initial business combination within such 12-month period (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time), unless we extend such period pursuant to our second amended and restated memorandum and articles of association, we will: (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of income taxes payable, and less up to $50,000 of interest to pay liquidation expenses) divided by the number of then outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our Board of Directors, liquidate and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to public rights or private rights. The rights will expire worthless if we fail to complete our initial business combination within the 12-month time period (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time).
+
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+Our sponsor, officers and directors have entered into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to their founder shares and private shares if we fail to complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time). However, if our initial shareholders acquire public shares after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the allotted 12-month time frame (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time).
+
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+Our sponsor, officers, and directors have agreed, pursuant to a written agreement with us, that they will not propose any amendment to our second amended and restated memorandum and articles of association that would (i) modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within 12 months from the closing of this offering (or up to 18 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time) or (ii) with respect to the other provisions relating to shareholders rights or pre-business combination activity, unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (I) interest shall be net of income taxes payable) divided by the number of then outstanding public shares.
+
+33
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+Table of Contents
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+ 
+ 
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+Limited payments to founders
+ 
+ 
+repayment at the closing of this offering of an aggregate of up to $500,000 in loans made to us by our sponsor to cover offering-related and organizational expenses;
+
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+payment to an affiliate of our sponsor of a total of $10,000 per month for office space, administrative and support services;
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+reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; and
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+ 
+repayment of non-interest bearing loans which may be made by our sponsor or an affiliate of our sponsor or certain of our officers and directors to finance transaction costs in connection with an intended initial business combination and non-interest bearing loans which may be made by our sponsor to extend the time period for consummating our initial business combination, the terms of which (other than as described above) have not been determined nor have any written agreements been executed with respect thereto. Up to $2,500,000 of the loans made by our sponsor, our officers and directors, or our or their affiliates or designees to us prior to or in connection with our initial business combination may be convertible into units, at a price of $10.00 per unit at the option of the lender, upon consummation of our initial business combination. The units would be identical to the private units.
+
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+ 
+ 
+repayment of non-interest bearing loans which may be made by our sponsor or its affiliates or designees, upon five days advance notice prior to the applicable deadline, to extend the time available for us to consummate our initial business combination. Pursuant to the terms of our second amended and restated memorandum and articles of association and the trust agreement into between us and Continental Stock Transfer & Trust Company on the date of this prospectus, in order to extend the time available for us to consummate our initial business combination, our sponsor or its affiliates or designees, upon five days advance notice prior to the applicable deadline, must deposit into the trust account $600,000, or up to $690,000 if the underwriters over- allotment option is exercised in full ($0.10 per share in either case) on or prior to the date of the applicable deadline, for each three month extension. (or up to an aggregate of $1,200,000 (or $1,380,000 if the underwriters over-allotment option is exercised in full), or $0.20 per public share then issued and outstanding if we extend for the full six months); or any additional extension loans if we later further the period that we must complete our initial business combination. Any such payments would be made in the form of a loan. Any such loans will be non-interest bearing and either be payable upon the consummation of our initial business combination out of the proceeds of the trust account released to us, or, at the lender s discretion, converted upon consummation of our business combination into additional private units at a price of $10.00 per unit. If we do not complete a business combination, the loans would be repaid out of funds not held in the trust account, and only to the extent available.
+
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+ 
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+
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+ 
+These payments may be funded using the net proceeds of this offering and the sale of the private units not held in the trust account or, upon completion of the initial business combination, from any amounts remaining from the proceeds of the trust account released to us in connection therewith.
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+Our audit committee will review on a quarterly basis all payments that were made to our sponsor, officers or directors, or our or their affiliates.
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+Audit Committee
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+We will establish and maintain an audit committee. Among its responsibilities, the audit committee will monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be 
+
+34
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+Table of Contents
+
+charged with the responsibility to promptly take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see the section entitled Management Committees of the Board of Directors Audit Committee. 
+
+ 
+ 
+ 
+
+Conflicts of Interest
+ 
+Our initial shareholders will directly or indirectly own 1,725,000 founder shares (up to 225,000 founder shares of which are subject to forfeiture depending on the extent to which the underwriters over-allotment option is exercised) and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination.
+
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+ 
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+ 
+The $0.0145 per share price that our initial shareholders paid for the founder shares creates an incentive whereby our sponsor, directors and officers could potentially make a substantial profit even if the company selects an acquisition target that subsequently declines in value and is unprofitable for public investors.
+
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+ 
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+In the event we do not consummate a business combination within the proscribed period, the founder shares, private units and their underlying securities will expire worthless, which could create an incentive for our initial shareholders to complete any transaction, regardless of its ultimate value.
+
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+Each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination.
+
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+Each of initial shareholders presently has, and any of them in the future may have additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity.
+
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+Our sponsor, officers and directors may in the future sponsor or form other special purpose acquisition companies similar to ours or may pursue other business or investment ventures during the period in which we are seeking an initial business combination.
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+Our officers and directors are not required to commit any specified amount of time to our affairs, and, accordingly, may have conflicts of interest in allocating management time among various business activities, including selecting a business combination target and monitoring the related due diligence.
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+Indemnity
+ 
+Our sponsor has agreed that it will be liable to us if and to the extent any claims by a vendor for services rendered or products sold to us, or a prospective target business with which we have discussed entering into a transaction agreement, reduce the amount of funds in the trust account to below (i) $10.00 per public share or (ii) such lesser amount per public share held in the trust account as of the date of the liquidation of the trust account due to reductions in the value of the trust assets, in each case net of the interest which may be withdrawn to pay taxes, except as to any claims by a third party who executed a waiver of any and all rights to seek access to the trust account and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. Moreover, in the event that an executed waiver is deemed to be unenforceable against a third party, our sponsor will not be responsible to the extent of any liability for such third-party claims. We have not independently verified whether our sponsor has sufficient funds to satisfy their indemnity obligations and believe that our sponsor s only assets are securities of our company. We have not asked our sponsor to reserve for such obligations.
+
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+35
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+Table of Contents
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+<a id="
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+This Registration Statement contains a prospectus relating to the initial public offering of Class A ordinary shares of Cantor Equity Partners III, Inc. for $10.00 per share. This Registration Statement also contains a prospectus relating to offers and sales of Class A ordinary shares of Cantor Equity Partners III, Inc. in connection with certain market making transactions that may be effected by Cantor Fitzgerald & Co. in the secondary market for 30 days following the date of this prospectus. The complete prospectus relating to the initial public offering of our Class A ordinary shares (the IPO Prospectus ) follows immediately after this Explanatory Note. Following the IPO Prospectus are certain pages of the prospectus relating solely to such market making transactions (together with the remainder of the prospectus as modified as indicated below, the Market Making Prospectus ), including an alternate front and back cover page, an alternate table of contents and alternate sections entitled Summary The Offering, Use of Proceeds and Plan of Distribution. Each of such alternate pages has been marked Alternate Page for Market Making Prospectus. The Market Making Prospectus will not include the information in the sections of the IPO Prospectus entitled Risk Factors Our sponsor paid an aggregate of $25,000 for the founder shares, or approximately $0.004 per founder share, and, accordingly, you will experience immediate and substantial dilution from the purchase of our Class B ordinary shares., Risk Factors The determination of the offering price of our Class A ordinary shares and the size of this offering is more arbitrary than the pricing of securities and size of an offering of an operating company in a particular industry. You may have less assurance, therefore, that the offering price of our Class A ordinary shares properly reflects the value of such Class A ordinary shares than you would have in a typical offering of an operating company., Dilution, Capitalization, Use of Proceeds and Underwriting (Conflict of Interest). All other sections of the IPO Prospectus are to be used in the Market Making Prospectus. A complete version of each of the IPO Prospectus and the Market Making Prospectus will be filed with the U.S. Securities and Exchange Commission in accordance with Rule 424 under the Securities Act of 1933, as amended (the Securities Act ). Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED JUNE 17, 2025 $200,000,000 Cantor Equity Partners III, Inc. 20,000,000 Class A Ordinary Shares _________________________ Cantor Equity Partners III, Inc. is a blank check company incorporated as a Cayman Islands exempted company for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated any discussions, directly or indirectly, with any business combination target regarding an initial business combination with our company. This is an initial public offering of our Class A ordinary shares at an offering price of $10.00 per share. The underwriters have a 45-day option from the date of this prospectus to purchase up to an additional 3,000,000 Class A ordinary shares to cover over-allotments, if any. Unlike in the initial public offerings by certain other special purpose acquisition companies, this is not an offering of units and investors will not receive warrants that would become exercisable following the completion of our initial business combination. We have until the date that is 24 months from the closing of this offering or until such earlier liquidation date as our board of directors may approve, to consummate our initial business combination. If we are unable to complete our initial business combination within 24 months from the closing of this offering and we do not seek shareholder approval to amend our amended and restated memorandum and articles of association to extend the date by which we must consummate our initial business combination, or by such earlier liquidation date as our board of directors may approve, we will redeem 100% of the Class A ordinary shares sold in this offering at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (less taxes paid and payable), divided by the number of then issued and outstanding public shares, subject to applicable law and certain conditions as further described herein. We will provide our public shareholders with the opportunity to redeem, regardless of whether they abstain, vote for, or vote against, our initial business combination, all or a portion of their Class A ordinary shares that are sold in this offering, which we refer to collectively as our public shares, upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below as of two business days prior to the consummation of our initial business combination, including interest earned on the funds held in the trust account, less taxes payable (excluding any excise tax), divided by the number of then outstanding public shares, subject to the limitations and conditions described herein. See Summary The Offering Redemption rights for our public shareholders upon completion of our initial business combination on page 25, Summary The Offering Redemption rights in connection with proposed amendments to our memorandum and articles of association on page 28, Summary The Offering Redemption of public shares and distribution and liquidation if no initial business combination on page 29 and Summary The Offering Manner of Conducting Redemptions on page 24 for more information, including for details related to limitations and conditions to effecting redemption rights. Our sponsor has also agreed to lend us up to $3,450,000, which we refer to herein as the sponsor note, which sponsor note will be drawn by us in connection with the consummation of our initial business combination, an extension of time for us to consummate an initial business combination or our liquidation (each, a Redemption Event ), such that an amount equal to $0.15 per public share being redeemed in connection with the applicable Redemption Event will be added to the trust account and paid to the holders of the applicable redeemed shares on such Redemption Event. The sponsor note will not bear interest and will be repayable by us to the sponsor upon consummation of an initial business combination; provided that, at any time beginning 60 days after the date of this offering, at our sponsor s option, all of any portion of the amount outstanding under the sponsor note may be converted into Class A ordinary shares at a conversion price of $10.00 per share. If we Table of Contents are unable to consummate an initial business combination, the sponsor note would be repaid only out of funds held outside of the trust account. Our sponsor has waived any claims against the trust account in connection with the sponsor note. See Summary The Offering Sponsor note on page 20 for more information about the sponsor note. Notwithstanding the redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct repurchases in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the Exchange Act )), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering without our prior consent. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. See Summary The Offering Limitation on redemption rights of shareholders holding more than 15% of the shares sold in this offering if we hold a shareholder vote on page 27 for further discussion on certain limitations on redemption rights. Our sponsor, Cantor EP Holdings III, LLC, has agreed to purchase 500,000 Class A ordinary shares at a price of $10.00 per share ($5,000,000 in the aggregate) in a private placement that will close simultaneously with the closing of this offering. These Class A ordinary shares are identical to the Class A ordinary shares sold in this offering, subject to certain limited exceptions as described in this prospectus. Our sponsor has purchased 5,750,000 Class B ordinary shares for $25,000 (or approximately $0.004 per founder share) (up to 750,000 shares of which are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised), which will automatically convert into non-redeemable Class A ordinary shares in connection with the consummation of our initial business combination or at any time and from time to time at the option of the holder thereof, as described herein. If we increase or decrease the size of the offering, we will effect a share dividend or a share contribution back to capital or other appropriate mechanism, as applicable, with respect to our Class B ordinary shares immediately prior to the consummation of the offering in such amount so that the founder shares will continue to represent 20% of our issued and outstanding ordinary shares upon the consummation of this offering (not including the private placement shares), which could cause dilution to our other shareholders. Such dilution could materially increase to the extent that the anti-dilution provision of the founder shares results in the issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion of the founder shares at the time of our initial business combination to maintain the number of founder shares at 20% (as described above). See Summary The Offering Sponsor Information on page 10 for further discussion on our sponsor s and our affiliates shares and compensation. Prior to the closing of our initial business combination, only holders of our Class B ordinary shares (i) will have the right to appoint and remove directors prior to or in connection with the completion of our initial business combination and (ii) will be entitled to vote on continuing our company in a jurisdiction outside the Cayman Islands (including any special resolution required to adopt new constitutional documents as a result of our approving a transfer by way of continuation to a jurisdiction outside the Cayman Islands). On any other matters submitted to a vote of our shareholders prior to or in connection with the completion of our initial business combination, holders of our Class B ordinary shares and holders of our Class A ordinary shares will vote together as a single class, except as required by law. The Class B ordinary shares will automatically convert into non-redeemable Class A ordinary shares in connection with the consummation of our initial business combination or at any time and from time to time at the option of the holder thereof, on a one-for-one basis, subject to adjustment for share sub-divisions, share dividends, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein. In the case that additional Class A ordinary shares, or equity-linked securities, are issued or deemed issued in excess of the amounts sold pursuant to this offering and related to the closing of the initial business combination, the ratio at which Class B ordinary shares shall convert into Class A ordinary shares will be adjusted (unless the holders of a majority of the issued and outstanding Class B ordinary shares agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of Class A ordinary shares issuable upon conversion of all Class B ordinary shares will equal, in the aggregate, on an as-converted basis, 20% of the sum of the total number of all ordinary shares issued and outstanding upon the completion of this offering (not including the private placement shares) plus all Class A ordinary shares and equity-linked securities issued or deemed issued in connection with the initial business combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in the Table of Contents initial business combination). This may result in material dilution of the public shares. Class A ordinary shares issued in connection with the conversion of our Class B ordinary shares issued prior to the consummation of our initial business combination are subject to the same restrictions as applicable to the Class B ordinary shares prior to such conversion including, among other things, certain transfer restrictions, waiver of redemption rights and the obligation to vote in favor of an initial business combination as described elsewhere in this prospectus. See Summary The Offering Founder shares on page 15, Summary The Offering Transfer restrictions on founder shares on page 18 and Summary The Offering Founder shares conversion and anti-dilution rights on page 18 for more information about our sponsor s founder shares. As more fully discussed in Management Conflicts of Interest on page 141, each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities and there may be actual material conflicts of interest between our sponsor, its affiliates, our officers and directors, or promoters, on the one hand, and purchasers in this offering, on the other hand. Cantor will be the beneficial owner of founder shares and private placement shares following this offering by virtue of its ownership of our sponsor, and members of our management team may indirectly own such securities. Because of such ownership and interests, Cantor, and any of our officers and directors who have an ownership interest in or are employed by Cantor, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Additionally, our officers and directors may have conflicts of interest with other entities to which they owe fiduciary or contractual obligations with respect to initial business combination opportunities, including the Active Cantor SPACs (as defined herein). See the sections titled Summary Conflicts of Interest on page 31, Proposed Business Sources of Target Business on page 117 and Management Conflicts of Interest on page 141, for more information. The low price that our sponsor paid for the founder shares (approximately $0.004 per share) creates an incentive whereby our sponsor could potentially make a substantial profit even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. If we are unable to complete our initial business combination within 24 months from the closing of this offering, or by such earlier or later liquidation date as our board of directors or shareholders may approve, the founder shares and private placement shares may expire worthless, except to the extent the holders thereof receive liquidating distributions from assets outside the trust account, which could create an incentive for our sponsor and our executive officers and directors who have an ownership interest or are employed by Cantor to complete a transaction even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors were to be included by a target business as a condition to any agreement with respect to our initial business combination. Additionally, we will reimburse our sponsor $10,000 per month for office space, administrative and shared personnel support services made available to us, and we will pay cash fees to our independent directors of $50,000 per year, payable quarterly, each as described elsewhere in this prospectus. Upon consummation of this offering, we will repay up to $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses. Further, upon consummation of our initial business combination, unless converted into Class A ordinary shares by our sponsor, we will be obligated to repay the up to $1,750,000 loan commitment made by our sponsor for working capital and the up to $3,450,000 sponsor note, neither of which bears interest, and any other working capital loans made by our sponsor or any of its affiliates. Such working capital loans and the sponsor note will also be convertible at the sponsor s option into Class A ordinary shares at a conversion price of $10.00 per share no earlier than 60 days after the date of this offering. Further, Cantor Fitzgerald & Co. ( CF&Co. ), an affiliate of our sponsor, will be entitled to receive an underwriting discount of $4,000,000 upon the closing of this offering, a business combination marketing fee of $7,000,000 upon the closing of our initial business combination (or up to $8,650,000 if the underwriters over-allotment option is exercised in full) and such other fees in connection with any additional financial advisory, placement agency or other similar investment banking services it may provide to us in the future. As a result, there may be actual or potential material conflicts of interest between our sponsor and our management team and their respective affiliates on the one hand, and purchasers in this offering on the other hand. See Summary The Offering Limited payments to insiders on page 30, Summary The Offering Sponsor Information on page 10 and Proposed Business Sponsor Information on page 111, for further discussion on our sponsor s and our affiliates shares and compensation. Table of Contents Currently, there is no public market for our Class A ordinary shares. We have applied to list our Class A ordinary shares on the Nasdaq Global Market, or Nasdaq, under the symbol CAEP . We expect that our Class A ordinary shares will be listed on the Nasdaq Global Market on or promptly after the date of this prospectus. We cannot guarantee that our Class A ordinary shares will be approved for listing on Nasdaq. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 41 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. No offer or invitation, whether directly or indirectly, is being or may be made to the public in the Cayman Islands to subscribe for any of our securities. Per Share Total Public offering price $ 10.00 $ 200,000,000 Underwriting discounts and commissions(1) $ 0.20 $ 4,000,000 Proceeds, before expenses, to Cantor Equity Partners III, Inc. $ 9.80 $ 196,000,000 ____________ (1) No commissions will be paid on any Class A ordinary shares sold pursuant to the underwriters over-allotment option. We will also pay $100,000 to Odeon Capital Group LLC for acting as a qualified independent underwriter in this offering. See the section of this prospectus entitled Underwriting (Conflicts of Interest) beginning on page 179 for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement shares, $200,000,000 or $230,000,000 if the underwriters over-allotment option is exercised in full ($10.00 per public share in either case) will be deposited into a trust account in the United States at J.P. Morgan Chase Bank, N.A., with Continental Stock Transfer & Trust Company acting as trustee, and $1,000,000, together with $1,750,000 of additional committed loans by our sponsor, will be available to pay fees and expenses in connection with the closing of this offering and for working capital following the closing of this offering. Because our sponsor acquired the founder shares at a nominal price (approximately $0.004 per share), our public shareholders will incur an immediate and substantial dilution upon the closing of this offering. Further, the Class A ordinary shares issuable in connection with the conversion of the founder shares may result in material dilution to our public shareholders due to the anti-dilution rights of our founder shares that may result in an issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion, and the issuance of Class A ordinary shares to our sponsor upon the conversion of any loans made by our sponsor may also cause material dilution to our public shareholders. See the sections titled Risk Factors Risks Relating to our Management Team The nominal purchase price paid by our sponsor for the founder shares may result in significant dilution to the implied value of our public shares upon the consummation of our initial business combination and our sponsor is likely to make a substantial profit on its investment in us in the event we consummate an initial business combination, even if the business combination causes the trading price of our ordinary shares to materially decline. on page 67 and Risk Factors Risks Relating to our Management Team The value of the founder shares following completion of our initial business combination is likely to be substantially higher than the nominal price paid for them, even if the trading price of our ordinary shares at such time is substantially less than $10.15 per share. on page 68. Table of Contents The following table illustrates the difference between the public offering price per Class A ordinary share and our net tangible book value per Class A ordinary share ( NTBV ), as adjusted to give effect to this offering and assuming the redemption of our public shares at varying levels and the exercise in full and no exercise of the over-allotment option. See the section titled Dilution on page 94 for more information. As of March 31, 2025 Offering Price of $10.00 per Class A ordinary share 25% of Maximum Redemptions 50% of Maximum Redemptions 75% of Maximum Redemptions Maximum Redemptions NTBV NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price Assuming Full Exercise of Over-Allotment Option $ 7.57 $ 6.98 $ 3.02 $ 6.00 $ 4.00 $ 4.08 $ 5.92 $ (1.36 ) $ 11.36 Assuming No Exercise of Over-Allotment Option $ 7.57 $ 6.98 $ 3.02 $ 6.00 $ 4.00 $ 4.09 $ 5.91 $ (1.27 ) $ 11.27 The underwriters are offering the Class A ordinary shares for sale on a firm commitment basis. The underwriters expect to deliver the Class A ordinary shares to the purchasers on or about , 2025. Sole Book-Running Manager Cantor , 2025 Table of Contents TABLE OF CONTENTS Page Summary 1
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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+Prospectus Summary beginning on page 1 of this prospectus.
+ 
+RISKS RELATED TO THE OFFERING
+ 
+Investing in the Company is a highly speculative investment and could result in the loss of your entire investment.
+ 
+A purchase of the offered securities is significantly speculative and involves significant risks. The offered securities should not be purchased by any person who cannot afford the loss of his or her entire purchase price. The business objectives of the Company are also speculative, and we may be unable to satisfy those objectives. The stockholders of the Company may be unable to realize a substantial return on their purchase of the offered securities, or any return whatsoever, and may lose their entire investment in the Company. For this reason, each prospective purchaser of the offered securities should read this prospectus and all of its exhibits carefully and consult with their attorney, business advisor and/or investment advisor.
+ 
+The offering price of the offered securities has been arbitrarily determined by the Company and such offering price should not be used by an investor as an indicator of the fair market value of the offered securities.
+ 
+Currently there is limited trading in the public market for the Company s common stock. The offering price for the offered Shares has been arbitrarily determined by the Company and does not necessarily bear any direct relationship to the assets, operations, book, or other established criteria of value of the Company. Thus, an investor should be aware that the offering price does not reflect the fair market price of the offered securities.
+ 
+As there is no minimum for our offering, if only a few persons purchase shares, they could lose their investment.
+ 
+Since there is no minimum with respect to the number of securities to be sold directly by the Company in this Offering, if only a few Shares are sold, we may not have enough capital to sustain our business. In such an event, it is highly likely that any investment would be lost. As such, proceeds from this Offering may not be sufficient to meet the objectives we state in this Prospectus, other corporate milestones that we may set, or to avoid a going concern modification in future reports of our auditors as to uncertainty with respect to our ability to continue as a going concern. If we fail to raise sufficient capital, we expect to have to significantly decrease operating expenses, which will curtail the growth of our business.
+ 
+The Company s management has full discretion in allocating net proceeds from the Offering. 
+ 
+We have allocated the net proceeds of the Offering in the sum of $400,000 (assuming the sale of all 40,000,000 shares of Common Stock) to working capital and operational expenses of the Company. As to such funds, investors will be relying on the judgment and discretion of the Company's management without specific information as to the uses, which are proposed to be made of such funds. Further, we may use any portion of the net proceeds of the Offering to acquire and/or invest in businesses related to the business of the Company (see Use of Proceeds ).
+ 
+Investors in the offering will experience immediate dilution of the value of their shares.
+ 
+Purchasers of the Shares will experience immediate dilution in the value of their Shares. Dilution represents the difference between the price per share paid by investors and the net tangible book value per share immediately after completion of the Offering (see Dilution ). Net tangible book value per share is the net tangible assets of the Company (total assets less total liabilities less intangible assets), divided by the number of shares of common stock outstanding. In addition to the dilution described above, further dilution may result if additional shares of Common Stock are sold or issued in the future, including shares issued in connection with any subsequent financing.
+ 
+ 
+7
+
+Table of Contents
+ 
+There is no firm commitment underwriting for the Offering.
+ 
+We do not have a firm commitment underwriting for the Offering. The Company is offering its Shares for sale through its officers and directors on a self-underwritten , best efforts basis without compensation. Accordingly, there is no assurance that we will sell the maximum Shares offered or any amount. If all of the Shares offered hereby are not sold, the Company will be limited in its ability to conduct its business.
+ 
+RISKS RELATED TO OUR COMPANY
+ 
+We are a recently re-organized development stage company but have not yet commenced operations in our business. We expect to incur operating losses in the foreseeable future.
+ 
+Since incorporation we have had limited to no operations, and we have only recently commenced our business operations, including a shift in focus from Big Data to FRT in June 2024. Accordingly, we have no way to evaluate the likelihood that our business will be successful. The likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection with the operations that we may undertake in the future. These potential problems include, but are not limited to, unanticipated problems relating to the market acceptance of our business, developing relationship with suppliers, distribution and challenges, and additional costs and expenses that may exceed current estimates. Prior to the time that we are ready to market and distribute our prospective product line, we anticipate that the Company will incur increased operating expenses without realizing any revenues. We expect to incur significant losses in the foreseeable future and recognize that if the effectiveness of our business plan is not forthcoming, we will not be able to continue business operations. There is no operating history upon which to base any assumption as to the likelihood that we will prove successful, and it is doubtful that we will generate any operating revenues or ever achieve profitable operations. If we are unsuccessful in addressing these risks, our yet to be determined acquisition of business or assets and subsequent business operations will most likely fail.
+ 
+We have incurred net losses since our inception and expect losses to continue.
+ 
+We have not been profitable since our inception and there is no guarantee that our subsequent operations will be profitable in the future. Subsequently, you could lose your entire investment.
+ 
+We may not be able to continue as a going concern if we do not obtain additional financing.
+ 
+Our independent accountant s audit report states that we have incurred only losses since our inception, raising substantial doubt about our ability to continue as a going concern. Therefore, our ability to continue as a going concern is highly dependent upon obtaining additional financing for our planned operations. There can be no assurance that we will be able to raise any additional funds, neither are we able to raise additional funds, nor that such funds will be in the amounts required or on terms favorable to us.
+ 
+Our current president and chief executive officer may have other business interests.
+ 
+Mr. Waqas Nakhwa, our President and Chief Executive Officer, and Mr. Andrew Gaudet, our Chief Operating Officer, currently devote approximately 30+ hours per week and 20+ hours per week, respectively. While they presently possess adequate time to attend to our interest, it is possible that the demands from other obligations could increase, with the result that they would no longer be able to devote sufficient time to the management of our business. The loss of either Mr. Nakhwa or Mr. Gaudet to our company could negatively impact our business development.
+ 
+ 
+8
+
+Table of Contents
+ 
+Our officers and directors control approximately 99.56% of the Company, giving them significant voting power, which allows them to take actions that may not be in the best interest of all other shareholders.
+ 
+Mr. Nakhwa, our Chief Executive Officer, President, Secretary, Treasurer, and Director, and our Chief Operating Officer, Mr. Andrew Gaudet, collectively own common stock representing approximately 99.56% of the outstanding shares of common stock. Accordingly, they are able to exert significant control over our management and affairs requiring stockholder approval, including approval of significant corporate transactions. They may also be able to determine their compensation. They also have significant influence in determining the outcome of any corporate transaction or other matters submitted to our shareholders for approval. This includes mergers and acquisitions, consolidations, and the sale of all or substantially all of our assets, election of directors and other significant corporate actions. In addition to their stock ownership, they are key to our operations and will have significant influence regarding our daily operation decisions. This concentration of ownership and influence over our decision-making may also discourage, delay, or prevent a change in control of the Company, which could deprive our other shareholders of an opportunity to receive a premium for their common stock as part of a sale of the Company and might reduce the price of our common stock. 
+ 
+We have requirements for and there is an uncertainty of access to additional capital.
+ 
+Ultimately, our ability to continue our business operations depends in part on our ability to obtain financing through debt financing, equity financing, or commence operations and generate revenues or some combination of these or other means. There can be no assurance that we will be able to obtain any such financing.
+ 
+We have no cash flow from operations and depend on equity financing and shareholder loans for our operations.
+ 
+Our current operating funds are less than necessary to complete our intended plan of operations. We will need additional funds. Our failure to obtain such additional financing could result in delay or indefinite postponement of further of any subsequent operations which would have a material adverse effect on our business.
+ 
+Our operating results are likely to fluctuate significantly in the future due to a variety of factors, many of which we have no control over. Factors that may cause our operating results to fluctuate significantly include: our ability to generate enough working capital from future sales; the level of commercial acceptance by the public of the services/products we may develop; fluctuations in the demands of any products; the amount and timing operating costs and capital expenditures relating to expansion of subsequent business, operations, infrastructure, and general economic conditions. If realized, any of these factors could have a material effect on our business, financial condition, and operating results. 
+ 
+RISKS RELATED TO OUR INDUSTRY
+ 
+The facial recognition industry is intensely competitive and evolving, and competitive pressures could adversely affect our pricing practices or demand for our offerings and services.
+ 
+We operate in the intensely competitive industry, which is characterized by rapidly changing technology, evolving industry standards and models for consuming and delivering business and services, frequent new product introductions, and frequent price and cost reductions. In general, as a participant in the facial recognition market, we face:
+ 
+ 
+ 
+Changes in social and market views on whether FRT should be widely used;
+
+ 
+ 
+Changes in customer spending preferences and other shifts in market demands, which drive changes in the Company s competition;
+
+ 
+ 
+Changes in pricing, marketing, and product strategies, such as potential aggressive price discounting and the use of different pricing models by our competitors;
+
+ 
+ 
+Rapid changes in technology and capabilities that challenge our ability to maintain differentiation from competitors;
+
+ 
+ 
+New and emerging technologies, competitors, and business models;
+
+ 
+ 
+Continued emergence of AI, biometric and FRT solutions that rival current technology offerings;
+
+ 
+ 
+Changing competitive requirements and deliverables in developing and emerging markets; and,
+
+ 
+ 
+Continuing trend toward consolidation of companies, which could adversely affect our ability to compete, including if our key partners merge or partner with our competitors.
+
+ 
+ 
+9
+
+Table of Contents
+ 
+We may face competition from larger, more well-established competitors, which are well-capitalized companies with widespread distribution, brand recognition and penetration of platforms and service offerings. Our competitors include companies like Cognitec Systems, iProov, and Oosto, as well as Amazon, Microsoft, and McAfee. The significant purchasing and market power of these larger competitors, which have greater financial resources than we do, could allow them to surpass our market penetration and marketing efforts to promote and sell their offerings and services. In addition, many other companies participate in specific areas of our business, such as artificial intelligence, computer vision, biometric analysis, and neural networks . In some cases, we may partner with a company in one area of our business and compete with them in another. In delivering our FRT products to certain of our customers, we may partner with Amazon, Google, or Microsoft. The status of our business relationships with these companies can influence our ability to compete for opportunities. In addition, we see additional competition from both established and emerging vendors and providers. Failure to compete successfully with new or existing competitors in these and other areas could have a material adverse impact on our ability to generate additional revenues or sustain existing revenue levels.
+ 
+Privacy concerns, evolving regulation of artificial intelligence, facial recognition and use of biometrics, and other domestic or foreign regulations may limit the use and adoption of our solutions and services and adversely affect our business.
+ 
+Regulation related to the provision of services over involving AI, facial recognition and use of biometrics is evolving, as federal, state, and foreign governments continue to adopt new, or modify existing, laws and regulations addressing data privacy and the collection, processing, storage, transfer, and use of data. In some cases, new data privacy laws and regulations , such as the European Union s General Data Protection Regulation that took effect in May 2018, the California Consumer Privacy Act, which took effect in January 2020, and an amended Act on the Protection of Personal Information in Japan, which took effect 2022, may impose new obligations on many of our customers, as well as directly on the Company as both a data controller and a data processor of human images and personal identifying information. These new laws may require us to make changes to our services and solutions to and/for our customers to comply with the new legal requirements and may also increase our potential liability exposure through higher potential penalties for non-compliance. These new or proposed laws and regulations are subject to differing interpretations and may be inconsistent among jurisdictions. These and other requirements could reduce demand for our services and solutions, require us to take on more onerous obligations in our contracts, restrict our ability to store, transfer and process data. In some cases, this could impact our ability to offer our services and solutions in certain locations or our customers' ability to deploy our solutions globally. Additionally, certain countries have passed or are considering passing laws requiring local data residency. The costs of compliance with and other burdens imposed by privacy laws, regulations and standards may limit the use and adoption of ,as well as reduce overall demand for our services and solutions, thereby, making it more difficult to meet expectations from or commitments to customers. This could lead to significant fines, penalties, or liabilities for noncompliance, or slow the pace at which we close sales transactions, any of which could harm our business.
+ 
+In addition to government activity, privacy advocacy and other industry groups have established or may establish new self-regulatory standards that may place additional burdens on our ability to provide our services and solutions globally. Our customers expect us to meet voluntary certification and other standards established by third parties, such as related International Organization for Standardization standards. If we are unable to maintain these certifications or meet these standards, it could adversely affect our ability to provide our solutions to certain customers and could harm our business. Furthermore, concerns regarding data privacy may cause our customers customers to resist providing the data necessary to allow our customers to use our services and solutions effectively.
+ 
+We will need continual development of our products to adapt to rapidly changing technology and consumer demands.
+ 
+We will face intense competition in the marketplace and will be confronted by rapidly changing technology, evolving industry standards, and consumer preferences, regulatory changes, and the frequent introduction of new solutions by our competitors that we must adapt and respond to. We need to continuously update our technology we develop, including our machine learning and other proprietary algorithms, in order to attract and keep new clients and to stay in front of evolving industry standards and regulatory requirements. Our failure to adapt to a rapidly changing market conditions and accepted technology advances would adversely affect our business.
+ 
+Our software is highly complex and may contain undetected errors. 
+ 
+The software underlying our platform is highly complex and may contain undetected errors or vulnerabilities, some of which may only be discovered after the code has been released. We anticipate relying heavily on a software engineering practice known as continuous deployment, meaning that we may release software code many times per day. This practice may result in the more frequent introduction of errors or vulnerabilities into the software underlying our platform. Any errors or vulnerabilities discovered in our code after release could result in damage to our reputation, loss of members, loss of revenue or liability for damages, any of which could adversely affect our growth prospects and our business. 
+ 
+ 
+10
+
+Table of Contents
+ 
+We are subject to the terms of open-source licenses because our technology will incorporate open-source software. 
+ 
+The software powering our marketplace incorporates software covered by open-source licenses. In addition, we will likely regularly contribute source code to open-source software projects and release internal software projects under open-source licenses, and we anticipate doing so in the future. The terms of many open-source licenses have not been interpreted by U.S. courts and there is a risk that the licenses could be construed in a manner that imposes unanticipated conditions or restrictions on our ability to operate our marketplace. Under certain open-source licenses, we could be required to publicly release the source code of our software or to make our software available under open-source licenses. To avoid the public release of the affected portions of our source code, we could be required to expend substantial time and resources to re-engineer some or all of our software. In addition, use of open-source software can lead to greater risks than use of third-party commercial software because open-source licensors generally do not provide warranties or controls on the origin of the software. Use of open-source software may also present additional security risks because the public availability of such software may make it easier for hackers and other third parties to determine how to compromise our platform. Additionally, because any software source code we contribute to open-source projects is publicly available, our ability to protect our intellectual property rights in such software source code may be limited or lost entirely, and we will be unable to prevent our competitors or others from using such contributed software source code. Any of these risks could be difficult to eliminate or manage and, if not addressed, could adversely affect our business, financial condition, and results of operations. 
+ 
+We may be unable to protect our intellectual property adequately. 
+ 
+Our intellectual property is an essential asset of our business. To establish and protect our intellectual property rights, we rely on a combination of trade secret, copyright, trademark and, to a lesser extent, patent laws, as well as confidentiality procedures and contractual provisions. The efforts we have taken to protect our intellectual property may not be sufficient or effective. We generally do not elect to register our copyrights or the majority of our trademarks, relying instead on the laws protecting unregistered intellectual property, which may not be sufficient. In addition, our copyrights, and trademarks, whether or not registered, and patents, may be held invalid or unenforceable if challenged. To the extent we do seek patent protection, any U.S. or other patents issued to us may not be sufficiently broad to protect our proprietary technologies. In addition, we may not be effective in policing unauthorized use of our intellectual property. Even if we do detect violations, we may need to engage in litigation to enforce our intellectual property rights. Any enforcement efforts we undertake, including litigation, could be time-consuming and expensive and could divert our management s attention. In addition, our efforts may be met with defenses and counterclaims challenging the validity and enforceability of our intellectual property rights or may result in a court determining that our intellectual property rights are unenforceable. If we are unable to cost-effectively protect our intellectual property rights, then our business could be harmed. 
+ 
+We may be subject to intellectual property claims, which are extremely costly to defend, could require us to pay significant damages and could limit our ability to use certain technologies in the future. 
+ 
+Companies within the technology industries are frequently subject to litigation based on allegations of infringement or other violations of intellectual property rights. To the extent we gain greater public recognition, we may face a higher risk of being the subject of intellectual property claims. Third-party intellectual property rights may cover significant aspects of our technologies or business methods or block us from expanding our offerings. Any intellectual property claims against us, with or without merit, could be time consuming and expensive to settle or litigate and could divert the attention of our management. Litigation regarding intellectual property rights is inherently uncertain due to the complex issues involved, and we may not be successful in defending ourselves in such matters. 
+ 
+In addition, some of our competitors have extensive portfolios of issued patents. Many potential litigants, including some of our competitors and patent holding companies, have the ability to dedicate substantial resources to enforcing their intellectual property rights. Any claims successfully brought against us could subject us to significant liability for damages and we may be required to stop using technology or other intellectual property alleged to be in violation of a third party s rights. We also might be required to seek a license for third-party intellectual property. Even if a license is available, we could be required to pay significant royalties or submit to unreasonable terms, which would increase our operating expenses. We may also be required to develop alternative non-infringing technology, which could require significant time and expense. If we cannot license or develop technology for any allegedly infringing aspect of our business, we would be forced to limit our service and may be unable to compete effectively. Any of these results could harm our business. 
+ 
+ 
+11
+
+Table of Contents
+ 
+The Use of AI in Facial Recognition involves ethical challenges that may impact our operations and reputation. 
+ 
+The deployment of artificial intelligence, particularly in facial recognition technologies, presents significant ethical challenges that may adversely impact our operations and reputation. Key concerns include the potential for algorithmic bias, which can lead to inaccurate identification or profiling of individuals based on race, gender, or socioeconomic status. Such biases not only compromise the integrity of our technology but can also result in harmful societal consequences, including discrimination and wrongful arrests.
+ 
+Additionally, the use of facial recognition raises serious privacy issues. Public and governmental scrutiny regarding surveillance practices has intensified, and improper use of our technology could lead to allegations of infringing on individual privacy rights. This may result in increased regulatory oversight and potential legal challenges, which could impose significant operational burdens and costs.
+ 
+Moreover, failure to implement robust ethical guidelines and transparency in our AI practices could lead to reputational damage. Negative media coverage or backlash from civil rights organizations may erode consumer trust and confidence in our brand, ultimately affecting our market position and financial performance. 
+ 
+As we navigate these ethical considerations, any missteps in the responsible deployment of facial recognition technology could have lasting repercussions, including loss of partnerships, diminished market share, and potential fines or sanctions from regulatory bodies.
+ 
+Risk of Racial Bias in AI and Biometric Technology.
+ 
+The integration of artificial intelligence and biometric technology in facial recognition systems carries the inherent risk of racial bias, which may lead to significant ethical and operational challenges. Research has shown that AI algorithms can exhibit disparities in accuracy based on race and ethnicity, potentially resulting in higher rates of false positives or negatives for certain demographic groups. Such biases not only undermine the reliability of our technology but can also perpetuate systemic discrimination and harm marginalized communities. Failure to address these biases may expose us to reputational damage, legal liabilities, and increased regulatory scrutiny. As public awareness of these issues grows, any perceived misuse or failure to mitigate bias could lead to backlash from consumers, advocacy groups, and policymakers. This could ultimately impact our relationships with partners and clients who prioritize ethical standards and social responsibility.
+ 
+In addition, regulatory frameworks around facial recognition are becoming more stringent, with potential bans or restrictions on usage in certain jurisdictions. Non-compliance with emerging ethical guidelines or failure to implement corrective measures could result in significant financial penalties and operational constraints, further jeopardizing our business objectives. To maintain our market position and uphold public trust, it is crucial that we actively work to identify and mitigate racial bias within our AI systems. Failing to do so could have consequences on our reputation, market access, and overall business performance.
+ 
+RISKS RELATED TO OUR COMMON STOCK
+ 
+The Company s stock price may be volatile.
+ 
+The market price of the Company s common stock is likely to be highly volatile and could fluctuate widely in price in response to various potential factors, many of which will be beyond the Company s control, including the following:
+ 
+ 
+ 
+Competition;
+ 
+ 
+Additions or departures of key personnel;
+ 
+ 
+The Company s ability to execute its business plan;
+ 
+ 
+Operating results that fall below expectations;
+ 
+ 
+Loss of any strategic relationship;
+ 
+ 
+Industry developments;
+ 
+ 
+Economic and other external factors; and
+ 
+ 
+Period-to-period fluctuations in the Company s financial results.
+ 
+ 
+12
+
+Table of Contents
+ 
+In addition, the securities markets have from time-to-time experienced significant price and volume fluctuations that are unrelated to the operating performance of particular companies. These market fluctuations may also materially and adversely affect the market price of the Company s common stock.
+ 
+Our common stock is subject to the penny stock rules of the Securities and Exchange Commission, and the trading market in our securities is limited, which makes transactions in our stock cumbersome and may reduce the value of an investment in our stock.
+ 
+Under U.S. federal securities legislation, our common stock will constitute penny stock . Penny stock is any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require that a broker or dealer approve a potential investor s account for transactions in penny stocks, and the broker or dealer receive from the investor, a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased. In order to approve an investor s account for transactions in penny stocks, the broker or dealer must obtain financial information and investment experience objectives of the person and make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks. The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prepared by the Commission relating to the penny stock market, which, in highlight form, sets forth the basis on which the broker or dealer made the suitability determination. Brokers may be less willing to execute transactions in securities, subject to the penny stock rules. This may make it more difficult for investors to dispose of our common stock and cause a decline in the market value of our stock. Disclosure must also be made about the risks of investing in penny stocks in both public offerings, as well as secondary trading, commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements must be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks.
+ 
+An active trading market for our common stock may never develop or be sustained.
+ 
+We cannot assure you that an active trading market for our Common Stock will develop in the future or, if developed, that any market will be sustained. Accordingly, you may be required to hold your Shares indefinitely or to sell them at a price that does not meet your expectations, if at all.
+ 
+The Company s management could issue additional shares.
+ 
+The Company has 700,000,000 authorized common shares, of which 55,405,732 are currently issued and outstanding. The Company s management could, without the consent of the existing shareholders, issue substantially more shares, causing a further dilution in the equity portion of the Company s current shareholders. Additionally, large share issuances would generally have a negative impact on the Company s share price.
+ 
+We do not anticipate paying dividends.
+ 
+We do not anticipate paying dividends on our common stock in the foreseeable future, but plan rather to retain earnings, if any, for the operation, growth, and expansion of our subsequent business. Because the Company does not anticipate paying cash dividends in the foreseeable future, which may lower expected returns for investors, our stockholders will not be able to receive a return on their investment unless they sell their shares of common stock.
+ 
+ 
+13
+
+Table of Contents
+ 
+SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS
+ 
+This prospectus contains forward looking statements that are based on our management s beliefs and assumptions and on information currently available to us. All statements other than statements of historical facts are forward looking statements. The forward looking statements are contained principally in, but not limited to, the sections entitled Prospectus Summary,
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/CGEH_capstone_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CGEH_capstone_prospectus_summary.txt
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained in other parts of this prospectus or incorporated by reference in this prospectus from our Annual Report on Form 10-K for the year ended March 31, 2025 and our Quarterly Reports on Form 10-Q for the quarters ended June 30, 2025 and September 30, 2025, and our other filings with the SEC listed below under the heading Incorporation of Certain Information by Reference. This summary may not contain all the information that you should consider before investing in securities. You should read the entire prospectus and the information incorporated by reference in this prospectus carefully, including Risk Factors and the financial data and related notes and other information incorporated by reference, before making an investment decision. See Special Note Regarding Forward-Looking Statements. In this prospectus, unless context requires otherwise, references to we, us, our, Capstone, or the Company refer Capstone Green Energy Holdings, Inc., a Delaware corporation and its consolidated subsidiaries. Overview Capstone has pioneered the future of low-emissions, oil-free power and energy technology for almost four decades. Our very low maintenance intervals allow for high availability rates, thus making us a leader of sustainable clean energy technology solutions worldwide. Our commitment to safety, innovation and operational excellence helps set the gold standard for holistic, sustainable energy solutions that deliver results. Capstone strives to be the first choice when energy matters. We do this by providing multi-faceted energy solutions in various formats. Our bespoke solutions help solve the Energy Trilemma of resiliency, affordability and sustainability. We develop, manufacture, market, sell and service microturbine-based technology solutions for use in stationary distributed power generation ( simple cycle ) applications or in distribution networks. Our microturbine technology can be used as a standalone power solution or as Combined Heat and Power ( CHP ) cogeneration and Integrated Combined Heat and Power ( ICHP ) applications where the heat recovery module is directly integrated to the microturbine package, and Combined Cooling, Heat and Power ( CCHP ), also known as tri-generation. We offer customers a range of commercial, industrial and utility scale options tailored to their specific needs ranging from 65 kilowatts ( kW ) to multiple megawatts ( MW ). Capstone also offers complimentary ancillary products to recycle waste energy into other useful applications. We also manufacture and supply system controllers that provide complete automated system control, including electrical load following and custom logic to protect against expensive local utility demand charges. To help clients maintain confidence in the total cost of ownership in their investment, Capstone also offers factory protection plans ( FPP ) which provide planned and unplanned maintenance coverage. For those clients who may be more capital constrained or prefer to leverage their capital back into their own businesses, Capstone also provides financial solutions under our Energy-as-a-Service ( EaaS ) offerings. Our EaaS offerings currently include four repeatable business models: (1) rental services, (2) Build, Own, Operate and Maintain ( BOOM ) and (3) power purchase agreement ( PPA ) solutions, and (4) lease to own. Our microturbines are sold primarily through global distributors and Original Equipment Manufacturers ( OEMs ). Distributors purchase our products for sale to end users and also provide service, application engineering, and installation support. Distributors also provide a variety of additional services, including engineering, application, and air permit support services in which the microturbines will be used, installation support of the products at the end users sites, commissioning the installed applications and providing post-commissioning service, including a FPP agreement. Our distributors perform as independent value-added resellers. OEMs integrate our products into their own product solutions. In the energy markets, we continue to expand our presence in the energy efficiency, natural resources, renewable energy, critical power, and microgrid power type of applications in the first half of our fiscal year ending March 31, 2026. The microgrid market is for electrification demand. The renewable energy market is fueled by landfill gas, biodiesel and biogas from sources such as food processing, agricultural waste and livestock manure. Our product sales in the oil and gas and other natural resources market is driven by our TABLE OF CONTENTS microturbines reliability, emissions profile and ease of installation. Given the continued volatility of the oil and gas market, our business strategy is to continue diversification within the microgrid energy efficiency and renewable energy markets. As part of our diversification strategy, we have begun to utilize our microgrid solutions into a reference design package for Artificial Intelligence ( AI ) and data center infrastructure. On October 21, 2025, we released a press release announcing that the Company has developed a new 800-volt direct-current ( VDC ) microturbine to support NVIDIA s new AI Infrastructure requirements. With the Company s compute partner, Microgrid for AI ( MG4AI ), the Company can now provide power and cooling plus compute as an engineered equipment package as on-site power to chip for the next generation of AI factories. Recent Developments November 2025 Private Placement On November 24 2025, we entered into a securities purchase agreement (the Purchase Agreement ) with the selling stockholders identified herein (the Selling Stockholders ), pursuant to which we sold to the Selling Stockholders in a private placement (the Private Placement ) an aggregate of (i) 3,980,000 shares (the Initial Shares ) of our common stock, par value $0.001 per share (the common stock ), at a purchase price of $2.00 per share and (ii) in lieu of shares of common stock for certain Selling Stockholders, pre-funded warrants (the Pre-Funded Warrants ) to purchase up to an aggregate of 3,520,000 shares of common stock (the Warrant Shares , and together with the Initial Shares, the Shares ) at a purchase price of $1.999 per Pre-Funded Warrant. Each Pre-Funded Warrant has an exercise price of $0.001 per Warrant Share, is exercisable at any time after their original issuance and will not expire. The Pre-Funded Warrants provide that the holder of the Pre-Funded Warrants does not have the right to exercise any portion of its Pre-Funded Warrants if such holder, together with its affiliates, would beneficially own in excess of 4.99% or 9.99%, at the holder s election, of the number of shares of common stock outstanding immediately after giving effect to such exercise. The gross proceeds from the Private Placement were approximately $15.0 million, before deducting placement agent fees and other expenses. The Company used the net proceeds from the Private Placement for the repayment of approximately $8.0 million of the Company s outstanding indebtedness which matured on December 7, 2025, and the Company intends to use the remaining net proceeds to fund continued product development, support its anticipated expansion into the AI data center market, as well as provide working capital and general corporate purposes.
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diff --git a/parsed_sections/prospectus_summary/2025/CHAI_core-ai_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CHAI_core-ai_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/CHR_cheer_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CHR_cheer_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2025/CIIT_tianci_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CIIT_tianci_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/CIK0001164098_transameri_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CIK0001164098_transameri_prospectus_summary.txt
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+Table of Contents SUMMARY The Transamerica Structured Index Advantage Annuity is an individual flexible premium deferred index-linked annuity policy. You can use the Policy to accumulate funds for retirement or other long-term financial planning purposes on a tax-deferred basis, and you may choose to convert those accumulated funds into a stream of guaranteed income payments from us. The amount of money that you are able to accumulate under your Policy will depend upon the performance of the investment options you select, the fees and charges deducted from your Policy, and the actions that you take with respect to your Policy, such as whether and when you take withdrawals. The Policy also includes a death benefit to help you financially protect your designated beneficiaries. The Policy is designed primarily for investors who expect to remain invested in an Allocation Account until the end of its Crediting Period and may be appropriate for you if you have a long investment time horizon. This Policy is not designed for people who expect to take early or frequent withdrawals. See PRODUCT RISK FACTORS for information about the Policy s investment risks. Transamerica Life Insurance Company is the issuer of the Policy. An investment in the Policy is subject to the risks related to us. Any obligations, guarantees, and benefits under the Policy are subject to our financial strength and claims-paying ability. See COMPANY OVERVIEW and FINANCIAL STATEMENTS for detailed information about the Company, including financial information.
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diff --git a/parsed_sections/prospectus_summary/2025/CIK0001710531_bonus_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CIK0001710531_bonus_prospectus_summary.txt
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2025/CIK0001753681_elite_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CIK0001753681_elite_prospectus_summary.txt
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2025/CIK0001779303_direct_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CIK0001779303_direct_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights selected information discussed in this prospectus. The summary is not complete and does not contain all of the information you should consider before investing in our common stock. Therefore, you should read this entire prospectus carefully, including the sections entitled "Risk Factors," "Management s Discussion and Analysis of Financial Condition and Results of Operations," and our financial statements and the related notes included elsewhere in this prospectus, before making a decision to purchase shares of our common stock. Some of the statements in this summary constitute forward-looking statements. See "Forward-Looking Statements." Overview We are a provider of Internet of Things (IoT) products, services and solutions. We deliver enhanced one-stop solutions that connect assets to increase visibility, operational efficiency, and profitability. We provide our solutions and services to a variety of industries, including Asset Location Management, Supply Chain Logistics and Transportation. We are a chosen global partner of service providers, value-added collaborators, system integrators, and enterprises due to our commitment to quality and demonstrated experience. We intend to continue expanding our long-standing relationships and work strategically with our partners, to jointly build leading IoT solutions based on integrated hardware, cloud-based software, and other services. For the years ended December 31, 2024 and 2023, we had net losses of $1,742,951 and $5,182,196, respectively. For the nine months ended September 30, 2025 and 2024, we had a net loss of $979,298 and a net income of $857,267, respectively. As a result of our recurring losses from operations and ongoing negative cash flows, our independent registered public accounting firm included an explanatory paragraph in its report on our financial statements as of, and for the year ended, December 31, 2024 and as of, and for nine months ended, September 30, 2025, describing the existence of substantial doubt about our ability to continue as a going concern. Our Products and Services Smart Hardware: We identify the right device for our client with a focus on the most suitable technology (4G LTE, Bluetooth, WiFi, etc.), price and the features & capabilities of the device to collect the data to solve the client s problem. Our specialty is aiding global Original Equipment Manufacturers, or OEMs, with devices that are not available or approved to operate in North America and guide the OEM with regulatory guidance, feature requirements and preparing the equipment for the North American market. We assist OEMs who manufacture 4G/5G LTE cellular routers, gateways, GPS devices or Bluetooth/LoraWan Sensors to enter the North American market. Software as a Service: We offer software applications that are differentiated to the solutions we provide. Our software platform is highly customizable and scalable, supporting best in class devices from industry leading manufacturers. Our software applications are customizable to meet the specific requirements of our customers, providing visibility into the critical assets of that allow our customers to efficiently and effectively run their business through the data points provided by our software applications. MiFleet A cloud-based fleet and asset management platform designed for the Small and Medium-sized Enterprise businesses with a desire to manage and lower operating costs by remotely monitoring vehicles and asset of any type – including remote and lone workers. MiFleet provides insight to location information, fuel consumption, driver behavior and other data points in which the vehicle or asset can provide. MiFleet improves operational efficiencies, support predictive maintenance scheduling and aids in fleet/asset optimization; allowing fleets to do more with less. MiFleet goes beyond dots on a map. Its vast catalog of device integrations and ability to support data points beyond location information allows us to aggregate sensor information to go beyond the fleet MiSensors MiSensors is our proprietary cloud-based remote sensor monitoring and management platform. It supports sensors of any type or technology. Businesses can remotely monitor their assets, equipment, or environment in real time. Alerts and Notifications are triggered when normal operating conditions are broken, providing immediate decision-making data for customers to run their business, lower their operational expense from a platform that is agnostic with sensor technology or type. Our offering allows customers to create and easily deploy an IoT sensor ecosystem that solves their real-world problems, as well as the ability to scale for future business operations. MiSensors allows our customers to set up multiple business locations, define users via hierarchy, set user-defined sensor reporting thresholds and run reports on the health of the assets in a business. The system is alert driven and notifies the customer of actionable events via email or SMS. Based on industry demand and multiple technology needs across our sales, we are integrating sensors utilizing Lora WAN, BLE and shortly Wi-Fi 6. 1 Managed Services: Our clients leverage our extensive expertise in device integration and configuration to ensure the device is performing and gathering data as the client is expecting. Our team of field application engineers work with our clients to expedite device deployments, lowering costs and fast-tracking hardware solutions for mass adoption. Our knowledge and deep understanding of the IoT industry allows us to provide simple integration services, or custom solution design services based on specific customer requests Connectivity: We offer a variety of cellular connectivity options in partnership with Tier 1 Cellular Providers, Mobile Virtual Network Operators (MNVOs), and Global Connectivity providers. This broad range is desired by our customers based on their requirements. Such a wide variety of offerings results in significant complication to connectivity management, SIM management, and data consumption reporting. We have compiled our connectivity into one cost effective device and connectivity management platform. MiConnectivity - our SIM Management Platform - is a single pane of glass for us and our clients to manage SIM allocation, activation, usage reporting, and cost management. The consolidation of data usage reporting into one reporting system provides our customers with a distinctive advantage to lower their operating expense relating to cellular connectivity. Our Industry Internet of Things (IoT) is the interconnection of various devices, machines or appliances that generate data. The aim of IoT is not just to create data, but also to extract valuable insights and information from the data generated by various devices. The devices include vehicles, smart phones, gadgets, appliances, and other products with embedded electronic sensors and software that constitute the devices. Demand for IoT is driven by connectivity, cloud computing, and marketing automation. IoT is used by a variety of industries, organizations, and individuals to raise operational efficiency, reduce risk, enhance functional visibility, increase revenue streams, and guarantee the highest level of client engagement. According to Fortune Business Insights, the global (IoT) market is projected to grow from $714.48 billion in 2024 to $4,062.34 billion by 2032, at a CAGR of 24.3%. Our Competitive Advantages We have navigated this complex market by solving real-world, real-time problems. We distinguish ourselves from our competition by integrating our clients philosophies into our team so that we may uphold their vision and maintain the integrity of their services. We have a very low turnover rate on our SaaS business and overall have a high customer retention. Our commitment to quality and the availability of our personnel separates us from other providers. Our growth strategy, mentioned above, should also expand our reputation from our peer group. Our Leadership Team We have assembled an experienced management team with significant experience in telecommunications, technology and sales. Our Founder, Mr. Chris Bursey, maintains over 20 years experience in the wireless communications industry. In addition to our CEO, we maintain a COO, CTO and CFO. Our Growth Strategy The IoT sector is still developing. The rise and popularity of managing connected devices is emerging, and it is approaching widespread adoption. We believe the following strategies will help us expand our company: Increase staff. We plan on increasing our staffing base by roughly 100% of our current headcount to meet demand. Currently, we have 10 employees and believe that number can grow to over 20 by early 2026. We seek to hire additional engineers, field technicians, customer service reps, support and salesmen. Increase marketing. We are an efficient operation leveraging the relationships of management and the goodwill of our existing customers. To increase our exposure, we plan on attending various conferences, exhibitions and trade meetings to boost our profile in the market. Research and Development. We are developing an aggregated/universal device management platform that we anticipate can be integrated into our current product offerings to our existing clients. The software will speed up the decision-making process by gathering big data at a faster rate. Purchase inventory. By boosting our inventories, we can avoid supply chain disruptions that adversely impacted our clients. Our increase in inventories will allow our clients to rely on us in greater capacity and provide recurring revenue. This strengthens our position to sell inventory with other value-added managed systems and connectivity solutions. 2 Acquisitions/Geographic expansion. Our industry is highly fragmented. Our clients have various locations. It behooves us to expand domestically into another highly trafficked metropolitan area. We are seeking complementary IoT companies that can expand our customer base while providing us with visibility in a new location. We are targeting companies that can give us a technological advantage over other service providers. Expand and Enhance Global Strategic Partnerships. We intend to stay relevant and avoid supply chain disruptions by establishing relationships with leading IoT companies and OEMs. The partnerships should allow immediate access to the most important products on the market. Our goal is to expand and satisfy our existing customer base. We also intend to reach new potential partners in the blockchain telecommunication and IoT industry for additional growth. Risks Affecting Our Business Our business is subject to numerous risks and uncertainties, including those highlighted in the section entitled "Risk Factors" immediately following this prospectus summary. These risks include, but are not limited to, the following: uncertainty around our future revenue growth and profitability; our possible need to raise additional funding, which may not be available on acceptable terms, or at all; the intensely competitive nature of the market in which we participate; uncertainty around our ability to develop our business and the market s reception of our services; the success of our efforts to expand, develop, and integrate our products and services; the existence of any defects or disruptions in our services; the impact of natural disasters, pandemics, other catastrophic events, and man-made problems such as war and regional geopolitical conflicts around the world; the security of online computer information, including breaches and enterprise data theft; the impact on our business of data privacy regulations or data privacy breaches; the impact of any weakening of global economic conditions; costs related to our compliance with existing and future regulations; the impact on our business of product liability claims; our ability to protect our intellectual property rights; costs associated with defending possible third party infringement or appropriation claims; our ability to attract and retain qualified key management and technical personnel; our performance in delivering high-quality technical support; and our reliance on a single customer for a substantial portion of our revenues. Impact of tariff and trade restrictions from current political uncertainty You should carefully consider all of the information set forth in this prospectus and, in particular, the information in the section entitled "Risk Factors" beginning on page 9 of this prospectus prior to making an investment in our common stock. These risks could, among other things, prevent us from successfully executing our strategies and could have a material adverse effect on our business, financial condition and results of operations. Corporate Information Our company was incorporated ins incorporated in Florida on September 9, 2006 and reincorporated in Delaware in April 2017, and is located at 11021 Via Frontera, Suite C, San Diego, California 92127. Our telephone number is (858)798-7100. Our website address is https://dcsbusiness.com/. Information contained on, or that can be accessed through, our website is not incorporated by reference in this prospectus. We have included our website address in the prospectus solely as an inactive textual reference. 3 Implications of Being an Emerging Growth Company As a company with less than $1.235 billion in revenue during our last fiscal year, we qualify as an emerging growth company ("EGC") as defined in the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"). For so long as we remain an EGC, we are permitted and have elected to rely on exemptions from specified disclosure requirements that are applicable to other public companies that are not EGCs. These exemptions include: being permitted to provide only two years of audited financial statements, in addition to any required unaudited interim financial statements, with correspondingly reduced "Management s Discussion and Analysis of Financial Condition and Results of Operations" disclosure; not being required to comply with the auditor attestation requirements in the assessment of our internal control over financial reporting; not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor s report providing additional information about the audit and the financial statements; reduced disclosure obligations regarding executive compensation; and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. We may take advantage of these provisions until the last day of the fiscal year following the fifth anniversary of the closing of this offering or such earlier time when we are no longer an EGC. We will cease to be an EGC if we have more than $1.235 billion in annual revenue, have more than $700 million in market value of our capital stock held by non-affiliates or issue more than $1 billion of non-convertible debt over a three-year period. We may choose to take advantage of some, but not all, of the available exemptions. We have taken advantage of some reduced reporting burdens in this prospectus. Accordingly, the information contained herein may be different than the information you receive from other public companies in which you may hold stock. The JOBS Act provides that an EGC may take advantage of an extended transition period for complying with new or revised accounting standards. This provision allows an EGC to delay the adoption of accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of this extended transition period, and as a result, we will comply with new or revised accounting standards on the relevant dates on which adoption is required for private companies. As part of this election, we are delaying the adoption of accounting guidance related to leases and implementation costs incurred in cloud computing arrangements that currently applies to public companies. We are assessing the impact this guidance will have on our financial statements. See Note 2 to our audited consolidated financial statements included elsewhere in this prospectus for additional information. Smaller Reporting Company Status We are a "smaller reporting company" as defined in the Exchange Act. We may take advantage of certain of the scaled disclosures available to smaller reporting companies so long as the market value of our voting and non-voting common stock held by non-affiliates is less than $250.0 million measured on the last business day of our second fiscal quarter, or our annual revenue is less than $100.0 million during the most recently completed fiscal year and the market value of our common stock held by non-affiliates is less than $700.0 million measured on the last business day of our second fiscal quarter. 4
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diff --git a/parsed_sections/prospectus_summary/2025/CIK0001900520_lomond_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CIK0001900520_lomond_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/CIK0001903508_public_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CIK0001903508_public_prospectus_summary.txt
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2025/CIK0001956453_semidux_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CIK0001956453_semidux_prospectus_summary.txt
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+F-1 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Shareholders of Semidux (Cayman) Holding Limited Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Semidux (Cayman) Holding Limited and its subsidiaries (collectively, the "Company") as of March 31, 2025, and the related consolidated statements of operations and comprehensive income, changes in shareholders equity, and cash flows for the year ended March 31, 2025, and the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of March 31, 2025, and the results of its operations and its consolidated cash flows for the year ended March 31, 2025, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These consolidated financial statements are the responsibility of the Company s management. Our responsibility is to express an opinion on the Company s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statement. We believe that our audits provide a reasonable basis for our opinion. /s/ HTL International, LLC We have served as the Company s auditor since 2025. Houston, TX December 30, 2025 F-2 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Shareholders of Semidux (Cayman) Holding Limited Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Semidux (Cayman) Holding Limited and its subsidiaries (collectively, the "Company") as of March 31, 2024 and 2023, and the related consolidated statements of operations and comprehensive income (loss), changes in shareholders equity, and cash flows for each of the two years in the period ended March 31, 2024, and the related notes (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of March 31, 2024 and 2023, and the results of its operations and its cash flows for each of the two years in the period ended March 31, 2024, in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These consolidated financial statements are the responsibility of the Company s management. Our responsibility is to express an opinion on the Company s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company s internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statement. We believe that our audits provide a reasonable basis for our opinion. /s/ TPS Thayer, LLC We have served as the Company s auditor since 2022. Sugar Land, TX July 12, 2024 F-3 SEMIDUX (CAYMAN) HOLDING LIMITED CONSOLIDATED BALANCE SHEETS (Expressed in U.S. Dollars, except for the number of shares) As of March 31, 2025 As of March 31, 2024 $ $ ASSETS CURRENT ASSETS: Cash $ 1,122,745 $ 731,652 Accounts receivable 9,057,588 4,504,279 Inventory, net 162,953 351,381 Advances to suppliers 2,043,008 29,317 Prepaid expenses and other current assets 566,465 162,888 Due from related parties 150,371 56,978 TOTAL CURRENT ASSETS 13,103,130 5,836,495 NON-CURRENT ASSETS: Right-of-use assets, net 303,581 30,132 Property and equipment, net 2,977,602 1,126,734 Intangible assets, net 3,629,794 3,037,499 Long-term investments, net - - Deferred tax assets 25,309 18,741 Deferred initial public offering costs 1,926,629 1,668,232 Other non-current assets, net 1,821,000 2,000,000 TOTAL NON-CURRENT ASSETS 10,683,915 7,881,338 TOTAL ASSETS $ 23,787,045 $ 13,717,833 LIABILITIES CURRENT LIABILITIES: Short-term bank loans 6,271,032 1,661,981 Accounts payable 2,267,079 341,244 Advance from customers 962,580 - Taxes payable 291,065 283,467 Operating lease liabilities, current 141,667 22,662 Financing lease liabilities 696,951 - Accrued expenses and other liabilities 256,806 211,437 TOTAL CURRENT LIABILITIES 10,887,180 2,520,791 NON-CURRENT LIABILITIES: Financing lease liabilities, non-current 625,785 - Operating lease liabilities, non-current 184,936 2,998 TOTAL NON-CURRENT LIABILITIES 810,721 2,998 TOTAL LIABILITIES 11,697,901 2,523,789 COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY Ordinary shares ($0.01 par value, 5,000,000 shares authorized, 1,000,000 shares issued and outstanding as of March 31, 2025 and 2024) 10,000 10,000 Additional paid-in capital 7,825,776 7,825,776 Statutory reserve 123,898 64,089 Retained earnings 4,688,333 3,791,644 Accumulated other comprehensive loss (558,863 ) (497,465 ) TOTAL SHAREHOLDERS' EQUITY 12,089,144 11,194,044 TOTAL LIABILITIES AND SHAREHOLDERS EQUITY $ 23,787,045 $ 13,717,833 The accompanying notes are an integral part of these consolidated financial statements. F-4 SEMIDUX (CAYMAN) HOLDING LIMITED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (Expressed in U.S. Dollars, except for the number of shares) For the fiscal years ended March 31, 2025 2024 $ $ Revenue Products-third party $ 14,940,840 $ 18,125,917 Products-related party - 495,386 Services-third party 3,337,798 2,521,646 Services-related party 746,397 637,874 Total revenue 19,025,035 21,780,823 Cost of revenue Products-third party (12,489,046 ) (15,040,181 ) Products-related party - (421,784 ) Services-third party (1,354,357 ) (1,180,628 ) Services-related party (691,156 ) (605,342 ) Total cost of revenue (14,534,559 ) (17,247,935 ) Gross profit 4,490,476 4,532,888 Operating expenses: Selling expenses (317,327 ) (381,108 ) General and administrative expenses (2,562,442 ) (2,230,089 ) Research and development expenses (395,600 ) (435,178 ) Exchange gains - 115,641 Total operating expenses (3,275,369 ) (2,930,734 ) Income from operations 1,215,107 1,602,154 Other income (expenses): Government grant 46,308 136,312 Other income 110,002 73,854 Share of net loss from equity investees - (209,495 ) Interest income 1,107 1,589 Interest expenses (142,804 ) (61,586 ) Total other income (expenses), net 14,613 (59,326 ) Income before income tax 1,229,720 1,542,828 Income tax expense (273,222) (185,338) Net income $ 956,498 $ 1,357,490 Comprehensive income Net income $ 956,498 $ 1,357,490 Foreign currency translation adjustments (61,398 ) (404,696 ) Comprehensive income $ 895,100 $ 952,794 Earnings per share, basic and diluted $ 0.96 $ 1.36 Weighted average number of shares 1,000,000 1,000,000 The accompanying notes are an integral part of these consolidated financial statements. F-5 SEMIDUX (CAYMAN) HOLDING LIMITED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY (Expressed in U.S. Dollars, except for the number of shares) Ordinary Shares Additional Paid-in Statutory Retained / earnings / Accumulated Other Comprehensive Total Shareholders' Shares Amount Capital Reserve Accumulated Loss Equity $ $ $ $ $ $ Balance, March 31, 2023 1,000,000 $ 10,000 $ 7,825,776 $ 47,749 $ 2,450,494 $ (92,769 ) $ 10,241,250 Net income for the year - - - - 1,357,490 - 1,357,490 Appropriation to statutory reserve - - - 16,340 - (16,340) - - Foreign currency translation adjustment - - - - - (404,696 ) (404,696 ) Balance, March 31, 2024 1,000,000 $ 10,000 $ 7,825,776 $ 64,089 $ 3,791,644 $ (497,465 ) $ 11,194,044 Net income for the year - - - - 956,498 - 956,498 Appropriation to statutory reserve - - - 59,809 (59,809 ) - - Foreign currency translation adjustment - - - - - (61,398 ) (61,398 ) Balance, March 31, 2025 1,000,000 $ 10,000 $ 7,825,776 $ 123,898 $ 4,688,333 $ (558,863 ) $ 12,089,144 The accompanying notes are an integral part of these consolidated financial statements. F-6 SEMIDUX (CAYMAN) HOLDING LIMITED CONSOLIDATED STATEMENTS OF CASH FLOWS (Expressed in U.S. Dollars, except for the number of shares) For the fiscal years ended March 31, 2025 2024 Cash flows from operating activities: Net income $ 956,498 $ 1,357,490 Adjustments to reconcile net income to net cash used in operating activities: Changes in allowances - inventories - 47,312 Depreciation of property and equipment 787,585 625,563 Loss on disposal of property and equipment 204 8,715 Gain on sale of long-term investments - (124,351) Amortization of intangible assets 499,830 398,471 Amortization expense of right-of -use asset 169,093 165,296 Warranty provision 8,011 18,155 Share of net loss from equity investees - 209,495 Allowance for credit losses 110,459 (45,000) Deferred income taxes (6,660) 104,660 Changes in operating assets and liabilities: Accounts receivable (4,693,515) (3,705,602) Inventory 187,712 1,222,751 Advances to suppliers, net (2,022,432) 10,130 Prepaid expenses and other current assets (192,166) 126,976 Other non-current assets 179,000 (420,000) Due from related parties (94,203) 752,576 Value added tax ("VAT") recoverable (214,522) 16,522 Accounts payable 1,926,330 339,727 Advance from customers 965,239 (1,966,729) Taxes payable 7,346 29,150 Operating lease liabilities (141,468 ) (171,825 ) Accrued expenses and other liabilities 38,252 58,921 Net cash used in operating activities (1,529,407) (941,597) Cash flows from investing activities: Purchase of property and equipment (2,654,702 ) (182,387 ) Purchase of long-term investment - - Sale of long-term investment - 424,857 Proceeds from disposal of Property and equipment - 53,020
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+Prospectus Summary 1 Risk Factors 9 Cautionary Note Regarding Forward-Looking Statements 27 Capitalization 28 Management s Discussion and Analysis of Financial Condition and Results of Operations 29 Business 33 Management 40 Executive Compensation 43 Certain Relationships and Related Party Transactions 48 Description of Capital Stock 49 Shares Eligible For Future Sale 51 Experts 51 Legal Matters 51 Where You Can Find More Information 51 Index to Financial Statements F-1 i ABOUT THIS PROSPECTUS You should rely only on the information contained in this prospectus and in any free writing prospectus filed with the SEC. We have not authorized anyone to provide you with different information or to make representations other than those contained in this prospectus. If anyone provides you with different or inconsistent information, you should not rely on it. We are not making an offer to sell these securities in any jurisdiction where the offer is not permitted. Unless otherwise indicated, references to "DMINT," the "Company," "we," "our," "us" or similar terms refer to the registrant, DMINT, Inc., and its subsidiaries, except where the context otherwise requires. ii CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS Certain statements in this prospectus contain "forward-looking statements" within the meaning of the federal securities laws. These statements relate to future events including, without limitation, the terms, timing of the spin-off distribution or our future financial performance. We have attempted to identify forward-looking statements by using terminology such as "anticipates," "believes," "expects," "can," "continue," "could," "estimates," "expects," "intends," "may," "plans," "potential," "predict," "should," "will," or the negative of these terms or other comparable terminology. These statements are only predictions; uncertainties and other factors may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels or activity, performance, or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. Our expectations are as of the date this prospectus is filed, and we do not intend to update any of the forward-looking statements after the date this prospectus is filed to confirm these statements to actual results, unless required by law. You should not place undue reliance on forward-looking statements. The cautionary statements set forth in this prospectus identify important factors which you should consider in evaluating our forward -looking statements. These factors include, among other things: Our ability to effectively execute our business plan; Our ability to manage our expansion, growth and operating expenses; Our ability to protect our brands and reputation; Our ability to repay our debts to OLB; Our ability to comply with new regulations that affect our business; Our ability to evaluate and measure our business, prospects and performance metrics; Our ability to compete and succeed in a highly competitive and evolving industry; Our ability to respond and adapt to changes in technology and customer behavior; Risks in connection with completed or potential acquisitions, dispositions and other strategic growth opportunities and initiatives; Fluctuating price of mined Bitcoin; Risks related to the recent distribution of our shares to the shareholders of OLB; Tax related risks of the Spin-Off Distribution; Risks related to our proposed digital asset investment strategy; Risks related to continued listing on NASDAQ; and Risks related to the Bitcoin mining industry. iii This prospectus also contains estimates and other statistical data made by independent parties and by us relating to market size and growth and other industry data. This data involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. We have not independently verified the statistical and other industry data generated by independent parties and contained in this prospectus. In addition, projections, assumptions, and estimates of our future performance and the future performance of the industries in which we operate are necessarily subject to a high degree of uncertainty and risk due to a variety of factors. Our actual results could differ materially from those anticipated in the forward -looking statements for many reasons, including, but not limited to, the possibility that we may fail to preserve our expertise in consumer product development; that existing and potential distribution partners may opt to work with, or favor the products of, competitors if our competitors offer more favorable products or pricing terms; that we may be unable to maintain or grow sources of revenue; that we may be unable to maintain profitability; that we may be unable to attract and retain key personnel; or that we may not be able to effectively manage, or to increase, our relationships with customers; and that we may have unexpected increases in costs and expenses. These and other factors could cause results to differ materially from those expressed in the estimates made by the independent parties and by us. MARKET DATA The Company uses market data throughout this prospectus. The Company has obtained certain market data from publicly available information and industry publications. These sources generally state that the information they provide has been obtained from sources believed to be reliable, but the accuracy and completeness of the information are not guaranteed. The forecasts and projections are based on industry surveys and the preparers experience in the industry, and there is no assurance that any of the projections or forecasts will be achieved. The Company believes that the surveys and market research others have performed are reliable, but the Company has not independently verified this information. iv PROSPECTUS SUMMARY This summary highlights certain information appearing elsewhere in this prospectus. Because it is only a summary, it does not contain all of the information that you should consider before investing in our securities and it is qualified in its entirety by, and should be read in conjunction with, the more detailed information appearing elsewhere in this prospectus. Before you decide to invest in our common shares, you should read the entire prospectus carefully, including "Risk Factors" beginning on page 9 and the financial statements and related notes included in this prospectus. Unless the context indicates otherwise, as used in this prospectus, the terms "DMINT," "we," "us," "our," "our company" and "our business" refer, to DMINT, Inc., including its subsidiaries named herein. 1 Our Company DMINT, Inc. ("DMINT" or the "Company" or "we"), a Delaware corporation was formed on July 23, 2021. DMINT is a Bitcoin mining company that has been a wholly owned subsidiary of The OLB Group, Inc. ("OLB"), a fintech public company listed on NASDAQ: OLB, since inception. The Company gained experience operating mining computers ("miners") during its Beta phase. Currently, we own and have 1,000 mining computers in our Selmer, Tennessee Mining Facility, which is owned by DMINT. The net carrying amount of miners was $117,014 and $493,750 at June 30, 2025 and December 31, 2024, respectively. There was no additional impairment recorded for miners for the year ended December 31, 2024 or the six months ended June 30, 2025. At our Tennessee Mining Facility, we are only able to obtain 0.65MW of electricity due to its current structural capabilities. Therefore, as of the date of this prospectus, we are only able to operate a maximum of 400 mining computers. The facility is approximately 15,000 square feet and has space for further expansion of up to 5,000 miners. We also have all the necessary electrical hardware and cooling solutions, such as transformers, panel guards, direct buses, smart power distribution units, cooling fans, and louvers to operate up to 5,000 miners. However, we do not have the cash necessary to pay for the installation of the equipment currently to allow our Tennessee Mining Facility to have such capabilities. When we are able to obtain enough capital to expand our Tennessee Mining Facilities structural capabilities, we plan to expand our operations to up 5,000 miners. Such planned expansion will occur in two phases. In phase one, we plan to scale the number of miners we operate from the 400 we currently operate to the 1,000 we currently own. To achieve this, we plan to expand our existing power capacity of 0.65MW. We have begun discussions with Pickwick Electric Cooperative ("Pickwick") to provide us up to 20MW of power capacity. Simultaneously, we will expand our infrastructure to accommodate the additional hardware and enhance the cooling and ventilation systems to handle the increased heat output. We believe this phase can be completed within 90 days of receipt of the funds necessary to expand our capabilities. In phase two, we plan to scale the number of miners we operate from 1,000 to 5,000. To achieve this, we will need to purchase an additional 4,000 miners and set them up in our Tennessee Mining Facility. We plan to enter into negotiations with Pickwick in the future to provide this additional power and will further expand our infrastructure to accommodate the additional hardware and enhance the cooling and ventilation systems to handle the increased heat output. In the event that the Spin-Off Distribution occurs in the second half of 2025 and assuming we can raise capital of at least $16 million after the Spin-Off Distribution, we plan on purchasing 4,000 new computers as soon as phase one is complete. The Company plans to focus its Bitcoin mining business in the United States, focusing on Bitcoin and revenue is generated from mining Bitcoin. Due to the increasing difficulty and competitive nature of mining, DMINT may invest more in R&D to enhance its technology and efficiency through more efficient and less costly energy resources. The average hashrate of the mining operation since the Company commenced operations in 2021 is 10 petahash per second. Since commencing operations through June 30, 2025, the Company has mined a total of 59.34 Bitcoin. The Company s wholly-owned subsidiary, DMINT Real Estate Holdings, Inc., owns a building and property in Selmer, Tennessee where the mining computers are located. Digital Asset Investment Strategy Our Board of Directors approved the identification and pursuit of a digital asset investment strategy intended to complement our existing Bitcoin mining operations. As part of this effort, we envision the establishment of a Bitcoin treasury, to accompany our existing Bitcoin mining operations, as long-term holdings and plan to strategically utilize Bitcoin as a primary treasury reserve asset in the future. The anticipated approach involves using Bitcoin to generate yield and provide liquidity, thereby supporting our current business operations and facilitating growth. To support execution when the strategy becomes operational, we aim to develop partnerships with leading Bitcoin financial service platforms and institutional providers, leveraging their expertise to ensure secure execution, effective governance, and market transparency. While this strategy has been authorized, it is not yet effective, and no investments outside of Bitcoin mining have been made to date. The Company plans to begin evaluating potential asset classes, allocation frameworks, and risk management policies, subject to further board review and regulatory compliance. As the strategy progresses and becomes material, updated disclosures will be provided. Corporate Information We were incorporated in the State of Delaware on July 23, 2021 for the purpose of establishing a Bitcoin mining operation, focused on Bitcoin mining. DMINT is a wholly-owned subsidiary of The OLB Group, Inc. Our Company s headquarters is located at 1120 Avenue of the Americas, 4th Floor, New York, NY 10036. Our telephone number is (212) 278-0900. Controlled Company Ronny Yakov, the chairman of the Company and the largest shareholder of OLB, will control approximately 50.16% of the voting power of our capital stock (based on shares of common stock outstanding as of ____, 2025) and will control approximately 50.16% of the combined voting power of our capital stock upon completion of this distribution, and we are therefore a "controlled company" as defined under Nasdaq Marketplace Rules. We do not intend to rely on the controlled company exemptions provided under Nasdaq Marketplace Rules. 2 Implications of Being an Emerging Growth Company We are an "emerging growth company" as defined in Section 2(a) of the Securities Act of 1933, as amended (the "Securities Act"). We had less than $1.235 billion in gross billing during our last fiscal year and have not tripped any of the measures that would cause us to no longer qualify as an emerging growth company. As such, we may take advantage of reduced public reporting requirements. These provisions include, but are not limited to: Being permitted to present only two years of audited financial statements and only two years of related Management s Discussion and Analysis of Financial Condition and Results of Operations in our filings with the SEC; Not being required to comply with the auditor attestation requirements in the assessment of our internal control over financial reporting; Reduced disclosure obligations regarding executive compensation in periodic reports, proxy statements and registration statements; and Exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We may take advantage of these provisions until the last day of our fiscal year following the fifth anniversary of the date of the first sale of Common Shares pursuant to this offering. However, if certain events occur before the end of such five-year period, including if we become a "large accelerated filer," if our annual gross billing exceed $1.235 billion or if we issue more than $1.0 billion of non-convertible debt in any three-year period, we will cease to be an emerging growth company before the end of such five-year period. An emerging growth company may take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act, for complying with new or revised accounting standards. We have elected to take advantage of this extended transition period and acknowledge such election is irrevocable. 3 QUESTIONS AND ANSWERS ABOUT THE SPIN-OFF DISTRIBUTION Q: How many DMINT common shares will I receive? A: OLB will distribute to you one DMINT common share for every share of OLB common stock that you own as of the close of business on , 2025, the record date (the "Spin-Off Distribution"). Q: Are there any restrictions on sales of the common shares I receive? A: There will not be any restrictions on sales of the common shares. Q: What are the DMINT common shares worth? A: The value of our common shares will be determined by their trading price after the Spin-Off Distribution. We do not know what the trading price of the common shares will be and we can provide no assurance as to value. Q: What will the relationship between OLB and DMINT be after the Spin-Off Distribution? A: After the Spin-Off Distribution, OLB does not expect to own any of the DMINT common shares or otherwise have an ownership interest in DMINT. OLB and DMINT will be separate publicly traded companies, although, at the time of the Spin- Off Distribution, some of the directors and officers of DMINT will hold similar positions at OLB. Q: What are the reasons for the Spin-Off Distribution? A: OLB is currently a FinTech company that focuses on a suite of products in the merchant services and payment facilitator verticals and seeks to provide integrated business solutions to merchants throughout the United States. In addition, in 2021, it began to explore Bitcoin mining as a separate business segment. The separation began with the formation of DMINT as a new holding subsidiary company of OLB. OLB believes that its lines of business are not accurately valued in the capital market, and the Spin-Off Distribution will enable each company (OLB and DMINT) to increase its business focus, alleviate market confusion and attract new investors. In determining whether to effect the Spin-Off Distribution, the board of directors of OLB considered the costs and risks associated with the transaction, including those associated with preparing DMINT to become a separate publicly traded company and the possibility that the trading value of the two separate entities after the Spin-Off Distribution may be less than the trading value of OLB s common stock before the Spin-Off Distribution. Notwithstanding these costs and risks, the board of directors of OLB determined that a spin-off, in the form contemplated by the Spin-Off Distribution is in the best interests of OLB and its stockholders. Q: Will DMINT common shares be listed on a securities exchange? A: DMINT applied to list its common shares on the NASDAQ. Q: Will my OLB shares continue to be listed on a securities exchange? A: Yes. OLB s common stock will continue to be listed on the NASDAQ under the symbol "OLB". The number of shares of OLB common stock you own will not change as a result of the Spin-Off Distribution. 4 Q: What are the U.S. federal income tax consequences to me of the Spin-Off Distribution? A: We believe that the Spin-Off Distribution generally will be taxable to our shareholders for U.S. federal income tax purposes. See "Tax Considerations – U.S. Federal Income Tax Treatment of the Spin-Off Distribution below. For U.S. federal income tax purposes, our distribution of common shares and cash in lieu of fractional shares to you in the Spin- Off Distribution is not expected to qualify as a tax-free corporate division for U.S. federal income tax purposes and as a result is expected to be treated like other distributions from OLB. Consistent with this expected treatment, the total value of this Spin- Off Distribution, as well as your initial tax basis in our shares, will be determined by the trading price of our common shares at the time of the Spin-Off Distribution. A portion of the value of this Spin-Off Distribution will be taxable to you as a dividend, to the extent of OLB s current and accumulated earnings and profits as determined for U.S. federal income tax purposes, and the remainder, if any, will be a reduction in the adjusted tax basis in your shares of OLB common stock. The tax treatment of the Spin-Off Distribution is discussed in further detail below in "Tax Considerations." You are urged to consult your own tax advisor to determine the particular tax consequences of the Spin-Off Distribution to you in your specific circumstances, including the applicability and effect of any federal, state, local and foreign tax laws. Q: How will I receive DMINT common shares? A: OLB will deliver 100% of the issued and outstanding common shares to the distribution agent. Transfer Online, Inc. will serve as distribution agent in connection with the Spin-Off Distribution and as transfer agent and registrar for DMINT common shares. See "Business – Mechanics of the Spin-Off Distribution." Q: What do I have to do to receive my DMINT common shares? A: No action by you is required. If your shares of OLB common stock are held in a brokerage account, the DMINT common shares distributed to you will be credited to that account. If you hold shares of OLB common stock in certificated or book entry form, your ownership of DMINT common shares will be recorded in the books of our transfer agent and a statement evidencing your ownership will be mailed to you. Certificates representing DMINT common shares will not be issued in connection with the Spin-Off Distribution, but we may elect to issue certificates in the future. Q: How will fractional common shares be treated in the Spin-Off Distribution? Fractional common shares will not be distributed. Instead, for registered shareholders, the distribution agent will aggregate fractional common shares into whole shares, sell such whole shares in the open market at prevailing rates promptly after our common shares commence trading on NASDAQ, and distribute the net cash proceeds from the sales, net of brokerage fees and other costs, pro rata to each holder who would otherwise have been entitled to receive fractional common shares in the distribution (net of any required withholding for taxes applicable to each holder). Holders of OLB common stock that hold their shares through a bank, broker, or nominee shall receive cash in lieu of fractional common shares, if any, determined in accordance with the policies of such bank, broker, or nominee. If an OLB shareholder holds fewer than ____shares of OLB common stock as of the record date, it will not receive any of our common shares, it will not receive any of our shares of common stock; however, the shareholder will receive a cash distribution from our distribution agent representing the proceeds from the sale of the fractional common shares to which the shareholder is entitled, net of brokerage fees and other costs. See "Business – Mechanics of the Spin-Off Distribution." for a more detailed explanation. If you receive cash in lieu of fractional common shares you will not be entitled to any interest on the payments. The receipt of cash in lieu of fractional common shares generally will be taxable to the recipient OLB shareholders that are subject to U.S. federal income tax as described in "Tax Considerations" below. Q: Are Shareholders of OLB entitled to appraisal rights in connection with the Spin-Off Distribution? A: No. Shareholders of OLB are not entitled to appraisal rights in connection with the Spin-Off Distribution. 5 SUMMARY FINANCIAL AND OTHER DATA The following table presents financial and other operating data for the periods and at the dates indicated. DMINT has been treated as a separate operating segment of OLB since its inception. Therefore, the financials shown herein reflect the actual results of DMINT on a stand-alone basis, separate and apart from the financial statements of our parent company, OLB. This financial data includes all assets, liabilities and results of operations of DMINT and DMINT Real Estate Holdings, Inc., its wholly-owned subsidiary, for the periods presented. The table should be read together with the section of this prospectus entitled "Management s Discussion and Analysis of Financial Condition and Results of Operation." The financial data of DMINT, Inc. for six months ended June 30, 2025 and the years ended December 31, 2024 and 2023 is a summary of the consolidated financial statements of DMINT, Inc. and notes thereto. The consolidated financial statements of DMINT, Inc. have been prepared in accordance with U.S. generally accepted accounting principles, or "U.S. GAAP." Balance Sheet Data June 30, 2025 December 31, 2024 December 31, 2023 Cash $51 $311 $645 All other current assets $406,793 $398,983 $1,083,587 Intangible assets $— $— $3,412,464 Property and equipment, net $2,870,752 $3,254,039 $5,796,857 Total Assets $3,277,596 $3,653,333 $10,293,553 Due to related parties $23,401,193 $22,661,401 $22,278,143 Account payable $616,294 $620,296 $505,266 Total Liabilities $24,017,487 $23,281,697 $22,783,409 Additional paid in capital $100 $100 $100 Accumulated deficit $(20,739,991) $(19,628,464) $(12,489,956) Total Shareholder Deficit $(20,739,891) $(19,628,364) $(12,489,856) Six Months Ended June 30, 2025 Year Ended December 31, 2024 Year Ended December 31, 2023 Revenue, net - Bitcoin mining $145,672 $413,332 $538,718 Depreciation and amortization expense $383,288 $2,992,813 $3,662,506 Contracted services $— $18,976 $121,006 Wage expense $511,573 $1,000,420 $1,058,327 Professional fees $117,833 $330,439 $168,933 Utilities $192,865 $325,671 $677,493 Equipment and maintenance expense $— $24,616 $136,274 Impairment expense $— $2,962,469 $259,931 General and administrative expenses $51,640 $393,918 $464,390 Loss from operations $(1,111,527) $(7,635,990) $(6,010,142) Realized gain on sale of bitcoin $— $222,751 $288,584 Unrealized gain on investment $— $274,731 $23,662 Net Loss $(1,111,527) $(7,138,508) $(5,697,896) Our consolidated statements of operations, balance sheets, shareholders equity and cash flows, together with the notes thereto, are included in the section of this prospectus entitled "Financial Statements" and should be read in their entirety. 6 THE SPIN-OFF DISTRIBUTION Distributing company The OLB Group, Inc. Distributed company DMINT, Inc. Shares to be distributed All 8,780,749 of our outstanding common shares. OLB does not expect to retain any of our common shares. Distribution ratio and record date Stockholders of OLB will receive approximately one common share for each share of OLB common stock owned at the close of business on ____, 2025. Prior to the Spin-Off Distribution, OLB will deliver 100% of the Company s issued and outstanding capital stock to the distribution agent. Transfer Online, Inc. will serve as distribution agent in connection with the Spin-Off Distribution and as transfer agent and registrar for the Company s common shares. See "Business – Mechanics of the Spin-Off Distribution." Fractional shares Fractional common shares will not be distributed. Instead, for registered shareholders, the distribution agent will aggregate fractional common shares into whole shares, sell such whole shares in the open market at prevailing rates promptly after our common shares commence trading on NASDAQ, and distribute the net cash proceeds from the sales, net of brokerage fees and other costs, pro rata to each holder who would otherwise have been entitled to receive fractional common shares in the distribution (net of any required withholding for taxes applicable to each holder). Holders of OLB common stock that hold their shares through a bank, broker, or nominee shall receive cash in lieu of fractional common shares, if any, determined in accordance with the policies of such bank, broker, or nominee. If a OLB shareholder holds fewer than shares of OLB common stock as of the record date, it will not receive any of our common shares; however, the shareholder will receive a cash distribution from our distribution agent representing the proceeds from the sale of the fractional common shares to which the shareholder is entitled, net of brokerage fees and other costs. See "Business – Mechanics of the Spin-Off Distribution" in this prospectus for a more detailed explanation. If you receive cash in lieu of fractional common shares, you will not be entitled to any interest on the payments. The receipt of cash in lieu of fractional common shares generally will be taxable to the recipient OLB shareholders that are subject to U.S. federal income tax as described in "Tax Considerations" below. No payment required No holder of shares of OLB common stock will be required to make any payment, exchange shares or to take any other action in order to receive our common shares. Distribution date The Spin-Off Distribution date will be on or about , 2025 (the "Distribution Date"). 7 Federal income tax consequences We believe that the Spin-Off Distribution generally will be taxable to our shareholders for U.S. federal income tax purposes. See "Tax Considerations – U.S. Federal Income Tax Treatment of the Spin-Of Distribution below. For U.S. federal income tax purposes, our distribution of common shares and cash in lieu of fractional shares to you in the Spin-Off Distribution is not expected to qualify as a tax-free corporate division for U.S. federal income tax purposes and as a result is expected to be treated for tax purposes like other distributions from OLB for such purposes. The total value of this Spin-Off Distribution, as well as your initial tax basis in our shares, will be determined by the trading price of our common shares at the time of the Spin-Off Distribution. A portion of the value of this Spin-Off Distribution will be taxable to you as a dividend, to the extent of OLB s current and accumulated earnings and profits as determined under U.S. federal income tax principles, and the remainder, if any, will be a treated as reduction in the adjusted tax basis in your shares of OLB common stock. The tax treatment of the Spin-Off Distribution is discussed below at "Tax Considerations." You are encouraged to consult your own tax advisors concerning the overall tax consequences arising in your own particular situation under United States federal, state, local or foreign law of the distribution and ownership of DMINT common shares and cash in lieu of fractional shares. Conditions to the Spin-Off Distribution Occurring The Spin-Off Distribution is subject to, among other things, the approval of OLB s Board of Directors, approval of our request for our common shares to be listed on NASDAQ and the effectiveness of the registration statement of which this prospectus forms a part. The fulfillment of the foregoing conditions will not create any obligation on the part of OLB to effect the Spin-Off Distribution. We are not aware of any material federal or state regulatory requirements that must be complied with or any material approvals that must be obtained, other than compliance with SEC rules and regulations and the declaration of effectiveness of the Registration Statement by the SEC, in connection with the distribution. OLB has the right not to complete the Spin-Off Distribution if, at any time, the board of directors of OLB determines, in its sole discretion, that the Spin-Off Distribution is not in the best interests of OLB or its stockholders, or that market conditions are such that it is not advisable to effect the Spin-Off Distribution. Distribution agent, transfer agent and registrar Transfer Online, Inc. will serve as distribution agent in connection with the Spin-Off Distribution and as transfer agent and registrar for our common shares. Listing There is currently no public market for our common shares. We have applied to list our common shares on NASDAQ under the symbol "DMNT." We expect trading will commence on a "when issued" basis on or around the record date. The successful listing of our common shares does not ensure that an active trading market for our common shares will be available to you. 8 THE COMPANY General We were incorporated by OLB to serve as an operating company for OLB s Bitcoin Mining Business Segment. We have one subsidiary which owns real estate in Tennessee where the operations are located. Business We are a Bitcoin mining company that has been a wholly owned subsidiary of OLB. Currently, we own and have 1,000 mining computers in our Selmer, Tennessee Mining Facility. At our Tennessee Mining Facility, we are only able to obtain 0.65MW of electricity due to its current structural capabilities. Therefore, as of the date of this prospectus, we are only able to operate a maximum of 400 mining computers. The facility is approximately 15,000 square feet and has space for further expansion of up to 5,000 miners. We also have all the necessary electrical hardware and cooling solutions, such as transformers, panel guards, direct buses, smart power distribution units, cooling fans, and louvers to operate up to 5,000 miners. However, we do not have the cash necessary to pay for the installation of the equipment currently to allow our Tennessee Mining Facility to have such capabilities. When we are able to obtain enough capital to expand our Tennessee Mining Facilities structural capabilities, we plan to expand our operations to up 5,000 miners. Such planned expansion will occur in two phases. In phase one, we plan to scale the number of miners we operate from the 400 we currently operate to the 1,000 we currently own. To achieve this, we plan to expand our existing power capacity of 0.65MW. We have begun discussions with Pickwick on providing up to 20MW. Simultaneously, we will expand our infrastructure to accommodate the additional hardware and enhance the cooling and ventilation systems to handle the increased heat output. We believe this phase can be completed within 90 days of receipt of the funds necessary to expand our capabilities. In phase two, we plan to scale the number of miners we operate from 1,000 to 5,000. To achieve this, we will need to purchase an additional 4,000 miners and set them up in our Tennessee Mining Facility. We plan to enter into negotiations with Pickwick in the future to provide this additional power and will further expand our infrastructure to accommodate the additional hardware and enhance the cooling and ventilation systems to handle the increased heat output. In the event that the Spin-Off Distribution occurs in the second half of 2025 and assuming we can raise capital of at least $16 million after the Spin-Off Distribution, we plan on purchasing 4,000 new computers as soon as phase one is complete. Since commencing operations through June 30, 2025, the Company has mined a total of 59.34 Bitcoin. Management Mr. Ronny Yakov is our President, Chief Executive Officer and Patrick Smith is our Interim Chief Financial Officer and Vice President of Corporate Finance. Our Bitcoin mining operation is managed by Thomas Fontanilla, Chief Operating Officer. See "Management." Dividends The declaration and payment of dividends, if any, on our common shares will be subject to the discretion of our Board of Directors, the requirements of Delaware law and restrictions in our loan agreements. See "Common Shares Dividend Policy." Risk factors An investment in our capital stock involves substantial risks. You should read this prospectus carefully, including the section entitled "Risk Factors" and the consolidated financial statements and the related notes to those statements included elsewhere in this prospectus in connection with the distribution of the common shares. 9 RISK FACTORS Any investment in our securities is highly speculative and involves a high degree of risk. You should carefully consider the risks described below, which we believe represent certain of the material risks to our business, together with the information contained elsewhere in this prospectus, before you make a decision to invest in our securities. If any of the following events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline and you could lose all or part of your investment. Risks Related to Our Company The substantial and continuing losses, and significant operating expenses incurred since inception may cause us to be unable to pursue all of our operational objectives if sufficient financing and/or additional cash from revenues is not realized. We have limited cash resources, recurring cash used in operations and operating losses history. As of June 30, 2025, we had a working capital deficiency of $23,610,643, and a net loss of $1,111,527 for the six months ended June 30, 2025. Our cash flow used in operating activities for the six months ended June 30, 2025 was $740,051. For the six months ended June 30, 2025, we received $849,112 from related parties and repaid $109,321. We may not be able to attract financing as needed, or if available, on reasonable terms as required and therefore may not be able to accomplish our business goals or repay certain of our debts. Further, the terms of any such financing may be dilutive to existing stockholders or otherwise on terms not favorable to us or existing stockholders. If we are unable to secure financing, as circumstances require, or do not succeed in meeting our sales objectives, we may be required to change, significantly reduce our operations or ultimately may not be able to continue our operations and there will be substantial doubt as to our ability to continue as a going concern. We have historically relied on OLB to finance our operations, and OLB will continue to finance operations of DMint until DMint has self-funding capabilities. To date, we have financed our operations from loans from OLB, our sole shareholder, and shared services provided by OLB for the benefit of the Company. If we are not able to fund operations through cash flow generated by the sale of Bitcoin or attract third-party funding sources, it may be necessary for OLB to fund future needs through a loan to the Company, by continuing to provide shared services on substantially similar terms in place prior to the Spin-Off Distribution and/or raising capital for the purpose of paying for the Company s incurred expenses. We anticipate entering into an amendment to the SSA (as defined below) concurrently with the Spin-Off Distribution, which will account for the payment of certain expenses by OLB in the event we are unable to fund ourselves. If OLB is not able to finance the operations in the absence of other sources, continued operations could be impacted and there will be doubt as to our ability to continue as a going concern. We may identify material weaknesses in our internal control over financial reporting. If we cannot remediate internal controls weaknesses or if we cannot maintain effective internal controls over financial reporting in the future, it could harm us. Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with U.S. generally accepted accounting principles ("GAAP"). Under standards established by the Public Company Accounting Oversight Board ("PCAOB"), a deficiency in internal control over financial reporting exists when the design or operation of a control does not allow management or personnel, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. The PCAOB defines a material weakness as a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of annual or interim financial statements will not be prevented, or detected and corrected, on a timely basis. We may identify material weaknesses in our internal control over financial reporting. 10 We may not be able to integrate new technologies and provide new services in a cost-efficient manner. The Bitcoin mining business is subject to rapid and significant changes in technology, frequent new service introductions and evolving industry standards. We cannot predict the effect of these changes on our competitive position, our profitability or the industry generally. Technological developments may reduce the competitiveness of our processes and equipment. If we fail to adapt successfully to technological advances or fail to obtain access to new technologies, we could lose or limit our ability to produce and sell Bitcoin. In addition, operating in a cost-efficient manner depends upon many factors, including the cost of energy, and we may not generate anticipated revenue from our operations. Disruptions in our equipment and infrastructure may result in loss of business, which could materially and adversely affect our reputation and business. Our equipment and systems are an integral part of our business operations. It is critical for our operations that our equipment and systems provide a continued and uninterrupted performance. Sustained or repeated system failures would reduce our ability to mine the Bitcoin. We face the following risks to our networks, infrastructure and software applications: our territory can have significant weather events which physically damage access lines; power surges and outages, computer viruses or hacking, earthquakes, terrorism attacks, vandalism and software or hardware defects which are beyond our control; and unusual spikes in demand or capacity limitations in our networks and energy sources. Disruptions may cause interruptions in lose potential revenue, which could cause us to incur expenses, and thereby adversely affect our business, revenue and cash flow. We must attract and retain skilled personnel. If we are unable to hire and retain technical, and operational employees, our business could be harmed. Our ability to grow will be particularly dependent on our ability to hire, develop and retain effective and qualified technical and managerial personnel. The competition for qualified, technical, and managerial personnel in the communications and software industry is intense in the markets where we operate, and we may not be able to hire and retain sufficient qualified personnel. In addition, we may not be able to maintain the quality of our operations, control our costs, maintain compliance with all applicable regulations, and expand our internal management, technical, information and accounting systems in order to support our desired growth, which could have an adverse impact on our operations. Volatility in the stock market and other factors could diminish our use, and the value, of our equity awards as incentives to employees, putting us at a competitive disadvantage or forcing us to use more cash compensation. We are dependent on the continued services and performance of our senior management and other key employees, the loss of any of whom could adversely affect our business, operating results and financial condition. Our future performance depends on the continued services and contributions of our senior management, including our Chief Executive Officer, Ronny Yakov, and other key employees to execute on our business plan and to identify and pursue new opportunities and product innovations. The loss of services of senior management or other key employees could significantly delay or prevent the achievement of our strategic objectives. From time to time, there may be changes in our senior management team resulting from the hiring or departure of executives, which could disrupt our business. We do not maintain key person life insurance policies on any of our employees other than a policy providing limited coverage on the life of our Chief Executive Officer. The loss of the services of one or more of our senior management or other key employees for any reason could adversely affect our business, financial condition and operating results and require significant amounts of time, training and resources to find suitable replacements and integrate them within our business and could affect our corporate culture. 11 Risks Related to Our Business We have an evolving business model. As Bitcoin assets and blockchain technologies become more widely available, we expect the services and products associated with them to evolve. In order to stay current with the industry, our business model may need to evolve as well. From time to time, we may modify aspects of our business model relating to our Bitcoin mining. We cannot offer any assurance that these or any other modifications will be successful or will not result in harm to our business. We may not be able to manage growth effectively, which could damage our reputation, limit our growth and negatively affect our operating results. Such circumstances could have a material adverse effect on our ability to continue as a going concern or to pursue our new strategy at all, which could have a material adverse effect on our business, prospects or operations. We may not be able to compete with other companies, some of whom have greater resources and experience. We may not be able to compete successfully against present or future competitors. We do not have the resources to compete with larger providers of similar services at this time. The Bitcoin mining industry has attracted various high-profile and well-established operators, some of which have substantially greater liquidity and financial resources than we do. With the limited resources we have available, we may experience great difficulties in building our network of computers and creating an exchange. Competition from existing and future competitors could result in our inability to secure acquisitions and partnerships that we may need to expand our business. This competition from other entities with greater resources, experience and reputations may result in our failure to maintain or expand our business, as we may never be able to successfully execute our business plan. The Bitcoin network features a large and growing number of miners competing for limited mining rewards. This competition intensifies with each participant added to the network. The competitive environment is exacerbated by the fact that the Bitcoin protocol halves mining rewards approximately every four years, reducing the potential earnings for miners and increasing the importance of operational efficiency. This requires us to continuously invest in new mining equipment to earn consistent Bitcoin mining rewards. Limited transaction capacity and scaling issues may impact mining results Bitcoin s "proof of work" validation mechanism inherently limits the number of transactions that can be processed per second. This limitation poses significant scaling challenges, affecting the network s ability to handle a high volume of transactions efficiently. As part of mining rewards are related to transaction fees, these issues may cause volatility in the rewards earned. During periods of high-demand and low-capacity, earned fees may exceed the block standard block reward. Conversely, increased capacity may lead to lower transaction fees if demand is reduced. Efforts to increase transaction capacity, such as sharding and other scalability solutions, are ongoing. However, their effectiveness, implementation timeline, and applicability to Bitcoin remain uncertain. These efforts may change the economics of Bitcoin mining, or potentially require new hardware or software to unlock. As a participant in the digital asset ecosystem, our business growth and development are closely tied to the widespread acceptance and scalability of digital assets, including Bitcoin. The competitive dynamics in Bitcoin mining, including the limited transaction capacity and the continual halving of mining rewards, present challenges that could impact our operational efficiency and profitability. Efforts to scale digital asset transactions may lead to significant changes in the competitive landscape of the digital asset market. These changes could affect the value of Bitcoin and, by extension, the valuation of the company. However, there is no certainty that scalability solutions will be universally effective for us or that they will not disadvantage certain participants. Given these challenges, there is a risk that our business, financial condition, and operating results could be materially adversely affected. The value of our common stock may also be impacted by these industry-wide issues. The properties included in our mining network may experience damages. Our current Bitcoin mining farm in Tennessee is, and any future mining farms we establish will be, subject to a variety of risks relating to physical condition and operation, including: the presence of construction or repair defects or other structural or building damage; any noncompliance with or liabilities under applicable environmental, health or safety regulations or requirements or building permit requirements; 12 any damage resulting from natural disasters, such as hurricanes, earthquakes, fires, floods and windstorms; and claims by employees and others for injuries sustained at our properties. For example, a mine could be rendered inoperable, temporarily or permanently, as a result of a fire or other natural disaster or by a terrorist or other attack on the mine. The security and other measures we take to protect against these risks may not be sufficient. Additionally, our mines could be materially adversely affected by a power outage or loss of access to the electrical grid or loss by the grid of cost-effective sources of electrical power generating capacity. Given the power requirement, it would not be feasible to run miners on back-up power generators in the event of a power outage or damage to our primary generators. If we are unable to successfully maintain our power arrangements on acceptable terms or at all or if we must otherwise relocate to replacement sites, our operations may be disrupted, and our business results may suffer. As part of our initial buildout phase, we set up and began operations across four cities in the United States, with three in Pennsylvania and one in Tennessee. After consolidating our operations, we currently operate out of one location in Selmer, Tennessee. We entered into definitive power arrangements with Pickwick Electric Cooperative, the utility company in Tennessee, which is intended to cover sites for our data centers that we may utilize in the near future. If we are forced to locate alternative sites because of unacceptable power arrangements, we may not be successful in identifying adequate replacement sites to house our miners. Even if we identify such sites, we may not be successful in leasing the necessary facilities at rates that are economically viable to support our mining activities. Even if we successfully secure the sites for our data centers, in the future, we may not be able to renew those on acceptable terms, in which case we would need to relocate our established mining operations. Relocating any mining operation may force us to incur the costs to transition to a new facility including, but not limited to, transportation expenses and insurance, downtime while we are unable to mine, legal fees to negotiate the new lease, de-installation at our current facility and, ultimately, installation at any new facility we identify. These costs may be substantial, and we cannot guarantee that we will be successful in transitioning our miners to a new facility. Such circumstances could have a material adverse effect on our business, prospects, financial condition, and operating results. We depend on third parties to provide us with certain critical equipment and rely on components and raw materials that may be subject to price fluctuations or shortages, including ASIC chips that have been subject to an ongoing significant shortage. In order to build and sustain our operations we will depend on third parties to provide us with ASIC mining equipment, which may be subject to price fluctuations or shortages. For example, the ASIC chip is the key component of a mining machine as it determines the efficiency of the device. The production of ASIC chips typically requires highly sophisticated silicon wafers, which currently only a small number of fabrication facilities, or wafer foundries, in the world are capable of producing. We believe that the current microchip and semiconductor shortage that the entire industry is experiencing leads to price fluctuations and disruption in the supply of key miner components. Specifically, the ASIC chips have been subject to a significant price increases and shortages. Our ability to source ASIC mining equipment and other critical components in a timely matter and at an acceptable price and quality level is critical to our operational buildout timeline and the development under our current business model. See "Business—Bitcoin Mining Technology". We will be exposed to the risk of disruptions or other failures in the overall global supply chain for Bitcoin mining hardware. This is particularly relevant to the ASIC mining equipment production since there is only a small number of fabrication facilities capable of such production, which increases our risk exposure to manufacturing disruptions or other supply chain failures. There is also a risk that a manufacturer or seller of ASIC computers or other necessary mining equipment may adjust the prices according to Bitcoin, other Bitcoin prices or otherwise, so the cost of new machines could become unpredictable and extremely high. As a result, at times, we may be forced to obtain miners and other hardware at premium prices, to the extent they are even available. Such events could have a material adverse effect on our business, prospects, financial condition, and operating results. 13 We may not be able to successfully implement or consummate our planned digital asset investment strategy. As of the date of this prospectus, we have not executed any material investments beyond Bitcoin mining, and there is a real possibility that the proposed strategy may never be implemented if risk factors prove prohibitive or regulatory standards cannot be met. The Company continues only to evaluate potential asset classes, investment parameters, and risk management practices under the highest scrutiny, with absolute priority placed on security, custody, and regulatory adherence. There can be no assurance that we will proceed with or benefit from any digital asset investments. We are exposed to risk of nonperformance by counterparties, including our counterparties under our power arrangements. We are exposed to risk of nonperformance by counterparties, whether contractual or otherwise. Risk of nonperformance includes inability or refusal of a counterparty to perform because of a counterparty s financial condition and liquidity or for any other reason. For example, our counterparties under our power arrangements may be unable to deliver the required amount of power at the required time for a variety of technical or economic reasons. Furthermore, there is a risk that during a period of power price fluctuations or prolonged or sharp power price increases on the market, our counterparties may find it economically preferable to refuse to supply power to us, despite the contractual arrangements. Any significant nonperformance by counterparties, could have a material adverse effect on our business, prospects, financial condition, and operating results. Additionally, our mining operations could be materially adversely affected by power outages and similar disruptions. Given the power requirements for our mining equipment, it would not be feasible to run this equipment on back-up power generators in the event of a government restriction on electricity or a power outage. Under some of our power arrangements, our power supply could be automatically reduced or curtailed by the market regulators or grid operators in cases of certain system disruptions or emergencies. If we are unable to receive adequate power supply and are forced to reduce or shut down our operations due to the availability or cost of electrical power, it would have a material adverse effect on our business, prospects, financial condition, and operating results. Bitcoin mining activities are energy-intensive, which may restrict the geographic locations of miners and have a negative environmental impact. Government regulators may potentially restrict the ability of electricity suppliers to provide electricity to mining operations, such as ours, or even fully or partially ban mining operations. Mining Bitcoin requires massive amounts of electrical power, and electricity costs are expected to account for a significant portion of our overall costs. The availability and cost of electricity will restrict the geographic locations of our mining activities. Any shortage of electricity supply or increase in electricity costs in any location where we plan to operate may negatively impact the viability and the expected economic return for Bitcoin mining activities in that location. Further, our business model can only be successful and our mining operations can only be profitable if the costs, including electrical power costs, associated with Bitcoin mining are lower than the price of Bitcoin itself. As a result, any mining operation we establish can only be successful if we can obtain sufficient electrical power for that site on a cost-effective basis, and our establishment of new mining data centers requires us to find sites where that is the case. Even if our electrical power costs do not increase, significant fluctuations in, and any prolonged periods of, low Bitcoin prices may also cause our electrical supply to no longer be cost-effective. In addition, there may be significant competition for suitable Bitcoin mining sites. Government regulators, including local permitting officials, may also potentially restrict our ability to set up Bitcoin mining operations in certain locations. They can also restrict the ability of electricity suppliers to provide electricity to mining operations in times of electricity shortage, or may otherwise potentially restrict or prohibit the provision of electricity to mining operations. As Bitcoin mining becomes more widespread, government scrutiny related to restrictions on Bitcoin mining facilities and their energy consumption significantly increases. The considerable consumption of electricity by mining operators may also have a negative environmental impact, including contribution to climate change, which could set the public opinion against allowing the use of electricity for Bitcoin mining activities or create a negative consumer sentiment and perception of Bitcoin, specifically, or Bitcoin generally. This, in turn, could lead to governmental measures restricting or prohibiting Bitcoin mining or the use of electricity for Bitcoin mining activities. Any such development in the jurisdictions where we plan to operate could increase our compliance burdens and have a material adverse effect on our business, prospects, financial condition, and operating results. Government regulators in other countries may also ban or substantially limit their local Bitcoin mining activities, which could have a material effect on our supply chains for mining equipment or services and the price of Bitcoin. 14 Bitcoin exchanges and other trading venues are relatively new and, in most cases, largely unregulated and may therefore be subject to fraud and failures. When Bitcoin exchanges or other trading venues are involved in fraud or experience security failures or other operational issues, such events could result in a reduction in Bitcoin prices or confidence and impact our success and have a material adverse effect on our ability to continue as a going concern or to pursue this segment at all, which would have a material adverse effect on our business, prospects and operations. Bitcoin market prices depend, directly or indirectly, on the prices set on exchanges and other trading venues, which are new and, in most cases, largely unregulated as compared to established, regulated exchanges for securities, commodities or currencies. For example, during the past three years, a number of Bitcoin exchanges have closed due to fraud, business failure or security breaches. In many of these instances, the customers of the closed exchanges were not compensated or made whole for partial or complete losses of their account balances. While smaller exchanges are less likely to have the infrastructure and capitalization that may provide larger exchanges with some stability, larger exchanges may be more likely to be appealing targets for hackers and "malware" (i.e., software used or programmed by attackers to disrupt computer operation, gather sensitive information or gain access to private computer systems) and may be more likely to be targets of regulatory enforcement action. We do not maintain any insurance to protect from such risks, and do not expect any insurance for customer accounts to be available (such as federal deposit insurance) at any time in the future, putting customer accounts at risk from such events. In the event we face fraud, security failures, operational issues or similar events such factors would have a material adverse effect on our ability of to continue as a going concern or to pursue this segment at all, which would have a material adverse effect on our business, prospects and operations. Our business may be significantly impacted by reputational risks and may impact how our business is perceived by customers, counterparties, and regulators. Reputational risks represent a significant concern in our industry, particularly due to the volatile and evolving nature of the Bitcoin markets. Our business faces potential reputational harm from several industry wide factors, including perceived regulatory non-compliance, catastrophic market volatile events, industry association with fraudulent or illegal activities. Such incidents can lead to a loss of trust among our customers, investors, and partners, adversely affecting our business. In addition, negative public perception, fueled by media coverage or social media discourse, can impact investor confidence and our company s market valuation. For example, incorrect or misleading statements about the power consumption of the Bitcoin network may damage the Company s perception as being energy efficient. Regulatory bodies may also view our operations with increased skepticism in the wake of certain events, potentially leading to stricter scrutiny and additional compliance requirements. Furthermore, as a company operating in a nascent and often misunderstood sector, any perceived ethical missteps or failures in corporate governance can be magnified, causing long-term damage to our brand and standing in the industry. Effectively managing these reputational risks is critical to maintaining our market position and ensuring sustainable growth. Failure to address or mitigate these risks adequately could have a material adverse effect on our business, financial condition, and operational results. 15 Regulatory changes or actions may alter the nature of an investment in us or restrict the use of Bitcoin in a manner that adversely affects our business, prospects or operations. As Bitcoin have grown in both popularity and market size, governments around the world have reacted differently to Bitcoin with certain governments deeming them illegal while others have allowed their use and trade. Governments may in the future curtail or outlaw the acquisition, use or redemption of Bitcoin. Ownership of, holding or trading in Bitcoin may then be considered illegal and subject to sanction. Governments may also take regulatory action that may increase the cost and/or subject Bitcoin companies to additional regulation. The effect of any future regulatory change on our business or on Bitcoin that may impact our business is impossible to predict, but such change could be substantial and would have a material adverse effect on our business, prospects and operations. Governments may in the future take regulatory actions that prohibit or severely restrict the right to acquire, own, hold, sell, use or trade Bitcoin or to exchange Bitcoin for fiat currency. Similar actions by governments or regulatory bodies could result in restriction of the acquisition, ownership, holding, selling, use or trading in our securities. Such a restriction could have a material adverse effect on our reputation and ability to continue as a going concern or to pursue this segment at all, raise new capital which would have a material adverse effect on our business, prospects or operations and harm investors in our securities. Future regulatory actions and regulatory change related to our business or Bitcoin, may impact our ability to continue to operate and such actions could affect our ability to continue as a going concern or to pursue this segment at all, which would have a material adverse effect on our business, prospects or operations. The development and acceptance of Bitcoin and algorithmic protocols governing the issuance of and transactions in Bitcoin is subject to a variety of factors that are difficult to evaluate. The use of Bitcoin to, among other things, buy and sell goods and services and complete transactions, is part of a new and rapidly evolving industry that employs digital assets based upon a computer-generated mathematical and/or Bitcoin protocol. The growth of this industry in general, and the use of Bitcoin in particular, is subject to a high degree of uncertainty, and the slowing or stopping of the development or acceptance of developing protocols may occur and is unpredictable. The factors include, but are not limited to: Continued worldwide growth in the adoption and use of Bitcoin; Governmental and quasi-governmental regulation of Bitcoin and their use, or restrictions on or regulation of access to and operation of the network or similar Bitcoin mining systems; Changes in consumer demographics and public tastes and preferences; The maintenance and development of the open-source software protocol of the network; The availability and popularity of other forms or methods of buying and selling goods and services, including new means of using fiat currencies; General economic conditions and the regulatory environment relating to digital assets; and Negative consumer sentiment and perception of Bitcoin specifically and Bitcoin generally. Such events would have a material adverse effect on our ability to continue as a going concern or to pursue this segment at all, which would have a material adverse effect on our business, prospects or operations and potentially the value of any Bitcoins we hold or expect to acquire for our own account and harm investors in our securities. 16 The impact of geopolitical events on the supply and demand for Bitcoin is uncertain. Crises may motivate large-scale purchases of Bitcoin which could increase the price of Bitcoin rapidly. This may increase the likelihood of a subsequent price decrease as crisis-driven purchasing behavior wanes, adversely affecting the value of any Bitcoin we hold or expect to acquire for our own account. Such risks are similar to the risks of purchasing commodities in general uncertain times, such as the risk of purchasing, holding or selling gold. As an alternative to gold or fiat currencies that are backed by central governments, Bitcoin, which are relatively new, are subject to supply and demand forces. How such supply and demand will be impacted by geopolitical events is uncertain but could be harmful to us and investors in our securities. Nevertheless, political or economic crises may motivate large-scale acquisitions or sales of Bitcoin either globally or locally. Such events would have a material adverse effect on our ability to continue as a going concern or to pursue this segment at all, which would have a material adverse effect on our business, prospects or operations and potentially the value of any Bitcoin we hold or expect to acquire for our own account. Acceptance and/or widespread use of Bitcoins is uncertain. Currently, there is a relatively small use of Bitcoin in the retail and commercial marketplace for goods or services. In comparison there is relatively large use by speculators contributing to price volatility. The relative lack of acceptance of Bitcoin in the retail and commercial marketplace limits the ability of end-users to use them to pay for goods and services. Such lack of acceptance or decline in acceptances would have a material adverse effect on our ability to continue as a going concern or to pursue this segment at all, which would have a material adverse effect on our business, prospects or operations and potentially the value of any Bitcoin we hold or expect to acquire for our own account. Political or economic crises may motivate large-scale sales of Bitcoins, which could result in a reduction in value and adversely affect us. As an alternative to fiat currencies that are backed by central governments, digital assets such as Bitcoin, which are relatively new, are subject to supply and demand forces based upon the desirability of an alternative, decentralized means of buying and selling goods and services, and it is unclear how such supply and demand will be impacted by geopolitical events. Nevertheless, political or economic crises may motivate large-scale acquisitions or sales of Bitcoin either globally or locally. Large-scale sales of Bitcoin would result in a reduction in their value and could adversely affect us. Such circumstances would have a material adverse effect on our ability to continue as a going concern or to pursue this segment at all, which would have a material adverse effect on our business, prospects or operations and potentially the value of any Bitcoin we hold or expect to acquire for our own account and harm investors. 17 Transactional fees may decrease demand for Bitcoin and prevent expansion. As the number of Bitcoin awarded for solving a block in a blockchain decreases, the incentive for miners to continue to contribute to the Bitcoin network will transition from a set reward to transaction fees. Either the requirement from miners of higher transaction fees in exchange for recording transactions in a blockchain or a software upgrade that automatically charges fees for all transactions may decrease demand for Bitcoin and prevent the expansion of the Bitcoin network to retail merchants and commercial businesses, resulting in a reduction in the price of Bitcoin that could adversely impact an investment in our securities. In order to incentivize miners to continue to contribute to the Bitcoin network, the Bitcoin network may either formally or informally transition from a set reward to transaction fees earned upon solving a block. This transition could be accomplished by miners independently electing to record in the blocks they solve only those transactions that include payment of a transaction fee. If transaction fees paid for Bitcoin transactions become too high, the marketplace may be reluctant to accept Bitcoin as a means of payment and existing users may be motivated to switch from Bitcoin to another Bitcoin or to fiat currency. Decreased use and demand for Bitcoin may adversely affect its value and result in a reduction in the price of Bitcoin and the value of our securities. Bitcoin inventory, including that maintained by or for us, may be exposed to cybersecurity threats and hacks. As with any computer code generally, flaws in Bitcoin codes may be exposed by malicious actors. Several errors and defects have been found previously, including those that disabled some functionality for users and exposed users information. Exploitations of flaws in the source code that allow malicious actors to take or create money have previously occurred. Despite our efforts and processes to prevent breaches, our devices, as well as our servers, computer systems and those of third parties that we use in our operations, are vulnerable to cyber security risks, including cyber-attacks such as viruses and worms, phishing attacks, denial-of-service attacks, physical or electronic break-ins, employee theft or misuse, and similar disruptions from unauthorized tampering with our servers and computer systems or those of third parties that we use in our operations. Such events could have a material adverse effect on our ability to continue as a going concern or to pursue our new strategy at all, which could have a material adverse effect on our business, prospects or operations and potentially the value of any Bitcoin or other Bitcoin we mine or otherwise acquire or hold for our own account. Macro-market events or perception of the Bitcoin industry in general could negatively impact our financial condition. The Bitcoin market has experienced significant volatility and disruptions, characterized by fluctuating prices, regulatory scrutiny, and varying public perception. These market conditions can potentially impact the reputation of firms operating in this space. There may be a heightened sense of caution or skepticism among customers, particularly retail investors, due to market instability. This could affect their investment decisions and trust in Bitcoin-related products and services. Counterparties, including institutional investors and service providers, may exercise increased due diligence and risk assessment when engaging with Bitcoin-focused businesses. Regulatory bodies globally are paying closer attention to Bitcoin assets, leading to a more stringent regulatory environment. This increased oversight can affect the perception of our business, particularly in terms of compliance and transparency. The market conditions necessitate a robust risk management framework to navigate the volatility and maintain operational stability. We have enhanced our compliance and reporting mechanisms to align with evolving regulatory expectations. While the market disruptions have introduced challenges, our diversified portfolio and adaptive business model have mitigated substantial negative impacts. In anticipation of these risks, we prioritize transparent communication with all stakeholders about market risks and our business practices. Engage in educational initiatives to improve public understanding of Bitcoin assets and their potential and proactively adapting to regulatory changes and working closely with regulators to ensure compliance and build trust. It may be illegal in the future, to acquire, own, hold, sell or use Bitcoin, participate in the blockchain or utilize similar digital assets in one or more countries, the ruling of which would adversely affect us. Although currently Bitcoin, the blockchain and digital assets generally are not regulated or are lightly regulated in most countries, including the United States, and the United States may take regulatory actions in the future that could severely restrict the right to acquire, own, hold, sell or use these digital assets or to exchange for fiat currency. If the United States, federally, or individual states take regulatory action to restrict the right to mine, acquire, hold sell or use digital assets, our business would be impacted. Such circumstances would have a material adverse effect on our ability to continue as a going concern or to pursue this segment at all, which would have a material adverse effect on our business, prospects or operations and potentially the value of any Bitcoin we hold or expect to acquire for our own account and harm investors. 18 Lack of liquid markets, possible manipulation of blockchain/Bitcoin-based assets and lack of effectiveness of safeguards for our Bitcoin may adversely affect us. Digital assets that are represented and trade on a ledger-based platform may not necessarily benefit from viable trading markets. Stock exchanges have listing requirements and vet issuers, requiring them to be subjected to rigorous listing standards and rules and monitoring investors transacting on such platform for fraud and other improprieties. These conditions may not necessarily be replicated on a distributed ledger platform, depending on the platform s controls and other policies. We have elected to use Coinbase – the largest US exchange by volume, and a publicly listed company – to sell our Bitcoin in an attempt to combat these issues. Coinbase maintains robust exchange controls, and operates futures markets, custodial services, and is a partner in multiple Bitcoin ETFs. We believe these elements significantly limit the ability of market manipulation due to low-liquidity. However, Coinbase does not have the same vetting of issuers as a national securities exchange, which leads to a higher potential risk for fraud or manipulation of digital assets. Such fraud our manipulation may decrease liquidity or volume, or increase volatility of digital securities or other assets, which may adversely affect us. Such circumstances would have a material adverse effect our ability to sell Bitcoin at profitable prices, which would have a material adverse effect on our business, prospects or operations and potentially the value of any Bitcoin we hold or expect to acquire for our own account and harm investors. Additionally, other than relying on the security protocols and safeguards provided to Coinbase and Fireblocks account holders, the Company has not implemented any additional safeguards or policies to protect its Bitcoin other than limiting the personnel who have access to the accounts to our executive officers. We also currently do not have our Bitcoin insured against theft, hacking or loss. The risk of using digital wallets is that the possession of the Company s Bitcoin is reliant upon a third-party maintaining control of its security protocols to protect possession. If Fireblocks were to be infiltrated, all of the Bitcoin held with it could potentially be lost or inaccessible. Further, if Coinbase were to be infiltrated after the Company s Bitcoin is transferred into its account, such Bitcoin could potentially be lost or inaccessible. If either of those events occur, it could result in a loss of our all or some of our Bitcoin, which would have a material adverse effect on our business and financial condition as the sale of Bitcoin is our only source of revenue and the loss of such assets would mean the loss of our revenue. If federal or state legislatures or agencies initiate or release tax determinations that change the classification of Bitcoin as property for tax purposes (in the context of when such Bitcoin are held as an investment), such determination could have a negative tax consequence on our Company or our shareholders. Current IRS guidance indicates that digital assets such as Bitcoin should be treated and taxed as property, and that transactions involving the payment of Bitcoin for goods and services should be treated as barter transactions. While this treatment creates a potential tax reporting requirement for any circumstance where the ownership of a Bitcoin passes from one person to another, usually by means of Bitcoin transactions (including off-blockchain transactions), it preserves the right to apply capital gains treatment to those transactions which may adversely affect an investment in our Company. 19 Our dependence on third-party software and personnel may leave us vulnerable to price fluctuations and rapidly changing technology. Competitive conditions within the Bitcoin industry require that we use sophisticated technology in the operation of our business. The industry for blockchain technology is characterized by rapid technological changes, new product introductions, enhancements and evolving industry standards. New technologies, techniques or products could emerge that might offer better performance than the software and other technologies we currently utilize, and we may have to manage transitions to these new technologies to remain competitive. We may not be successful, generally or relative to our competitors in the Bitcoin industry, in timely implementing new technology into our systems, or doing so in a cost-effective manner. During the course of implementing any such new technology into our operations, we may experience the system interruptions and failures discussed above. Furthermore, there can be no assurances that we will recognize, in a timely manner or at all, the benefits that we may expect as a result of our implementing new technology into our operations. We rely on computer hardware, purchased or leased, and software licensed from and services rendered by third parties in order to provide our solutions and run our business, sometimes by a single-source supplier. We rely on computer hardware, purchased or leased, and software licensed from and services rendered by third-parties in order to provide our solutions and run our business, sometimes by a single-source supplier. The hardware used are Bitcoin mining computers and related peripherals specifically programmed to mine Bitcoin. This hardware is purchased under standard contract terms, including purchase price, delivery date, and remediation for failures to meet delivery timelines. Third-party hardware may not continue to be available on commercially reasonable terms, or at all. Any loss of the right to use or any failures of third-party hardware could result in delays in our ability to provide our solutions or run our business until equivalent hardware is developed by us or, if available, identified, obtained and integrated, which could be costly and time-consuming and may not result in an equivalent solution, any of which could cause an adverse effect on our business and operating results. While this hardware is specialized, there are several primary vendors for this equipment, and numerous secondary retailers. The primary software utilized by our business is "pooled mining services", wherein miners direct their hashrate to a shared service to earn more consistent, predictable Bitcoin returns. We currently have agreed to the general terms and conditions of service with Foundry Digital Mining s pool services. The pooled mining services are third-party software and services, and may not continue to be available on commercially reasonable terms, or at all. Any loss of the right to use or any failures of software or services could result in delays in our ability to provide our solutions or run our business until equivalent software or services are developed by us or, if available, identified, obtained and integrated, which could be costly and time-consuming and may not result in an equivalent solution, any of which could cause an adverse effect on our business and operating results. In the event that no "pooled mining services" are available at all, we believe our business can operate natively on the Bitcoin network without the use of such services. However, this would cause significant delays in the discovery of new blocks, and therefore payments, but result in a larger reward at the time of discovery. The ultimate effect would be an increased volatility in our earnings when viewed daily, but only a small disruption when viewed at an annual scale. 20 Risks Related to Laws and Regulations Failure to comply with, or changes in, laws, regulations and enforcement activities may adversely affect the products, services and markets in which we operate. We are subject to U.S. financial services regulations, a myriad of consumer protection laws, including economic sanctions, laws and regulations, anticorruption laws, escheat regulations and privacy and information security regulations. Changes to legal rules and regulations, or interpretation or enforcement of them, could have a negative financial effect on us. Any lack of legal certainty exposes our operations to increased risks, including increased difficulty in enforcing our agreements in those jurisdictions and increased risks of adverse actions by local government authorities, such as expropriations. In addition, the company from which we purchase power to run the machines is subject to regulation by federal and state authority and, as a result, could pass through some of those compliance obligations to us, which could adversely affect our business, financial condition or results of operations. The regulatory landscape for Bitcoin assets is evolving rapidly, with significant jurisdictional variations. This creates uncertainty regarding compliance requirements, operational constraints, and potential legal challenges. U.S. and foreign regulatory bodies are increasingly asserting jurisdiction over Bitcoin assets, leading to a complex regulatory environment. U.S. regulatory agencies, including the SEC, CFTC, and IRS, among others, have varying stances on Bitcoin assets. Changes in their regulatory approach could lead to significant operational and compliance challenges. The assertion of jurisdiction by U.S. regulators could result in stringent reporting requirements, increased compliance costs, and potential restrictions on certain Bitcoin-related activities. Securities and Exchange Commission (SEC) Oversight: The SEC may assert that certain Bitcoin assets are securities and therefore subject to its regulatory purview. This could lead to stricter compliance requirements for token issuances and trading platforms. Though DMINT does not participate in the issuance or trading of these tokens, such scrutiny may materially impact the price of Bitcoin and our core business. Commodity Futures Trading Commission (CFTC) Actions: The CFTC could enhance its oversight of Bitcoin derivatives and futures markets, impacting firms involved in these areas of the Bitcoin market. DMINT does not actively participate in these businesses, but Bitcoin is regulated by the CFTC as a commodity. Any change in regulation may impact the price of Bitcoin and our business, or otherwise change our handling of the sales and hedging of mined Bitcoin. Anti-Money Laundering (AML) and Know Your Customer (KYC) Regulations: Regulatory bodies like the Financial Crimes Enforcement Network (FinCEN) may implement more stringent AML and KYC requirements for Bitcoin transactions. This could lead to enhanced customer due diligence and reporting obligations. Taxation and Reporting Requirements: The Internal Revenue Service (IRS) in the U.S. and other national tax authorities may introduce or clarify tax reporting requirements for Bitcoin transactions, impacting the tax liabilities and compliance burden for Bitcoin businesses. Foreign governments may impose their own regulatory frameworks, which could be more restrictive than those in the U.S. This can affect our ability to operate in international markets and may limit market accessibility. Differing regulations across jurisdictions can complicate compliance efforts, especially for a global operation like DMINT Inc. European Union s Markets in Bitcoin-Assets (MiCA) Regulation: The EU s proposed MiCA framework aims to regulate Bitcoin asset issuers and service providers in the EU, setting standards for consumer protection, operational resilience, and market integrity. While MiCA is unlikely to directly impact our operations, it may require additional compliance costs for interacting with counterparties and service providers in these jurisdictions. Global Regulatory Coordination Efforts: Efforts by international bodies like the Financial Action Task Force (FATF) and the G20 to establish global standards for Bitcoin regulation may require us to change regulatory reporting or adopt new compliance requests. Recognition of OFAC and FATF restricted parties lists may also increase the burden of meeting compliance requirements. Data Privacy Regulations: Data privacy laws, like the General Data Protection Regulation (GDPR) in the EU, could affect how Bitcoin businesses handle user data and execute transactions. This may force DMINT to alter our business retention policies, compliance and regulation standards, or change our approach to expansion in these jurisdictions. 21 Specific regulatory actions in key markets like the U.S., EU, Asia, and others, such as licensing requirements, operational restrictions, or outright bans on certain Bitcoin activities, could significantly impact global Bitcoin asset markets. These impacts may have direct and secondary impacts on the price of Bitcoin, and, by extension, DMINT s business. Further, legislation enacted in New York which restricted mining of Bitcoin to, in general, existing mining operations. As a result, we were forced to abandon certain endeavors to build out Bitcoin mining operations within New York. The title of the law signed by New York Governor Kathy Hochul on November 22, 2022 is "An act to amend the environmental conservation law, in relation to prohibiting certain Bitcoin mining operations that use carbon-based power sources". The law bans certain Bitcoin mining operations that run on carbon-based power sources for the next two years, unless a proof-of-work mining company uses 100% renewable energy. The law also prohibits new entrants from coming online and existing companies from expanding or renewing permits if they do not meet the renewable energy requirement. The law is the first of its kind in the country and is aimed at curbing the state s carbon footprint. Risks Relating To Our Common Shares Our common shares have never been publicly traded and there is no existing market for our common shares. An active trading market that will provide you with adequate liquidity for our common shares may not develop. There is currently no public market for our common shares and, following the Spin-Off Distribution, 50.16% of our shares will be held by one shareholder, which concentration of ownership could make it less likely that an active and liquid trading market for our common shares will develop on NASDAQ. We cannot predict the extent to which investor interest will lead to the development of an active and liquid trading market on NASDAQ for our common shares or, if such market develops, whether it will be maintained. In addition, all of the shares of DMINT held by Ronny Yakov, the chairman of the Company and the largest shareholder of OLB (owning approximately 50.16% of OLB s shares) will be restricted from sale in the public market for a period of six months commencing on the Distribution Date (as defined below). The lack of an active trading market on NASDAQ and low trading volume for our common shares may make it more difficult for you to sell our common shares and could lead to our share price becoming depressed or volatile. It is anticipated that on or shortly prior to the record date for the distribution of our common shares, trading of our common shares will begin on a "when -issued" basis on NASDAQ and such trading would continue up to and including the distribution date. However, there can be no assurance that an active trading market for our common shares on either NASDAQ or any other exchange will develop. If an active and liquid trading market does not develop, relatively small sales of our common shares could have a significant negative impact on the price of our common shares. Ronny Yakov, the chairman of the Company and the largest shareholder of OLB, will beneficially own greater than 50% of our common shares after the Spin-Off Distribution, which may cause us to be deemed a "controlled company" under the rules of NASDAQ. Ronny Yakov currently controls approximately 50.16% of the voting power of our capital stock and will control approximately 50.16% of the combined voting power of our capital stock upon completion of the Spin-Off Distribution. As a result, Ronny Yakov., owns more than 50% of our outstanding shares (and will continue to own more than 50% of our outstanding shares upon consummation of the Spin-Off Distribution), and as such, we may be a "controlled company" under the rules of NASDAQ. Under these rules, a company of which more than 50% of the voting power is held by an individual, a group or another company is a "controlled company" and, as such, can elect to be exempt from certain corporate governance requirements, including requirements that: a majority of the Board of Directors consist of independent directors; the board maintain a nominations committee with prescribed duties and a written charter; and the board maintain a compensation committee with prescribed duties and a written charter and comprised solely of independent directors. As a "controlled company," we may elect to rely on some or all of these exemptions, however, we do not intend take advantage of any of these exemption. Despite the fact we do not intend to take advantage of these exemptions, our status as a controlled company could make our common shares less attractive to some investors or otherwise harm our stock price. Following the Spin-Off Distribution, the aggregate trading value of DMINT common shares and OLB common stock may be less than the trading value of OLB s common stock before the Spin-Off Distribution. The Spin-Off Distribution will result in two separate and distinct companies: OLB will own only assets related to the payment processing business and DMINT will own all assets related to Bitcoin mining. Although we expect that the Spin- Off Distribution will result in an increase in shareholder value, the aggregate trading value of the two separate entities after the Spin- Off Distribution may be less than the trading value of OLB common stock before the Spin-Off Distribution. 22 If securities or industry analysts do not publish research or reports about our business, or publish negative reports about our business, our share price and trading volume could decline. As a newly-incorporated company, there is currently no analyst coverage of the Company. The trading market for our common shares will depend, in part, upon the research and reports that securities or industry analysts publish about us or our business. We do not have any control over analysts as to whether they will cover us, and if they do, whether such coverage will continue. If analysts do not commence coverage of the Company, or if one or more of these analysts cease coverage of the Company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which could cause our share price or trading volume to decline. In addition, if one or more of the analysts who cover us downgrade our shares or change their opinion of our shares, our share price may likely decline. Substantial sales of our common shares may occur in connection with the Spin-Off Distribution, which could cause our share price to decline. Following the Spin-Off Distribution, all of our outstanding stock will be owned by the existing shareholders of OLB, and these existing shareholders will be free to sell common shares received in the distribution after the effective date of the registration statement of which this prospectus forms a part for any reason. Moreover, because the Spin-Off Distribution is expected to be taxable to our shareholders, there may be substantial sales of our stock made by our shareholders in order to achieve liquidity to pay for tax liabilities owed as a result of the Spin-Off Distribution. The sales of significant amounts of our common shares, or the perception that this may occur, could result in a decline of the price of our common shares. You may experience future dilution as a result of future equity offerings and other issuances of our common shares, preferred shares or other securities. In order to raise additional capital, including to support our growth plans, or in connection with equity awards, strategic transactions or otherwise, we may in the future offer additional common shares, preferred shares, or other securities convertible into or exchangeable for our common shares, including convertible debt. We expect that a significant component of a future financing will be for additional mining computers will be through equity offerings. We cannot predict the size of future issuances or sales of our common shares, preferred shares or other securities, including those made in connection with future acquisitions or capital raising activities, or the effect, if any, that such issuances or sales may have on the market price of our common shares. The issuance and sale of substantial amounts of common shares, preferred shares or other equity-linked securities, or announcement that such issuance and sales may occur, could adversely affect the market price of our common shares. In addition, we cannot assure you that we will be able to make future sales of our common shares, preferred shares or other securities in any other offering at a price per share that is equal to or greater than the price per share paid by investors, and investors purchasing shares or other securities in the future could have rights that are superior to existing shareholders. The issuance of additional common shares, preferred shares or other securities could adversely impact the trading price of our common shares. 23 The market price of our common shares may be subject to significant fluctuations. The market price of our common shares may be subject to significant fluctuations as a result of many factors, some of which are beyond our control. Among price are: actual or anticipated fluctuations in quarterly and annual variations in our results of operations; changes in market valuations or sales or earnings estimates or publication of research reports by analysts; changes in earnings estimates or shortfalls in our operating results from levels forecasted by securities analysts; speculation in the press or investment community about our business or the Bitcoin mining industry; changes in market valuations of similar companies and stock market price and volume fluctuations generally; strategic actions by us or our competitors such as mergers, acquisitions, joint ventures, strategic alliances or restructurings; changes in government and other regulatory developments; additions or departures of key personnel; general market conditions and the state of the securities markets; and domestic and international economic, market and currency factors unrelated to our performance. The Bitcoin mining industry has been highly unpredictable. In addition, the stock markets in general, and the markets for Bitcoin in general, have experienced extreme volatility that has sometimes been unrelated to the operating performance of particular companies. These broad market fluctuations may adversely affect the trading price of our common shares. If our common shares do not meet NASDAQ s minimum share price requirement, and if we cannot cure such deficiency within the prescribed timeframe, our common shares could be delisted. Under the rules of NASDAQ, listed companies are required to maintain a share price of at least $1.00 per share. If the share price declines below $1.00 for a period of 30 consecutive business days, then the listed company has a cure period of at least 180 days to regain compliance with the $1.00 per share minimum. If the price of our common shares closes below $1.00 for 30 consecutive days, and if we cannot cure that deficiency within the 180-day timeframe, then our common shares could be delisted. If the market price of our common shares is below $5.00 per share, and we are not then on an exchange, under stock exchange rules, our shareholders will not be able to use such shares as collateral for borrowing in margin accounts. This inability to continue to use our common shares as collateral may lead to sales of such shares creating downward pressure and increased volatility in the market price of our common shares. We are an emerging growth company and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common shares less attractive to investors. We are an emerging growth company, as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies. We cannot predict if investors will find our common shares less attractive because we may rely on these exemptions. If some investors find our common shares less attractive as a result, there may be a less active trading market for our common shares and our share price may be more volatile. In addition, under the JOBS Act, our independent registered public accounting firm will not be required to attest to the effectiveness of our internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act of 2002 for so long as we are an emerging growth company. For as long as we take advantage of the reduced reporting obligations, the information that we provide our shareholders may be different from information provided by other public companies. 24 Risk Factors Relating To The Spin-Off Distribution Our historical financial information may not be representative of the results we would have achieved as a stand -alone public company and may not be a reliable indicator of our future results. The historical financial information that we have included in this prospectus may not necessarily reflect what our financial position, results of operations or cash flows would have been had we been an independent entity during the periods presented or those that we will achieve in the future. The costs and expenses reflected in our historical financial information include an allocation for certain corporate functions historically provided by OLB, that may be different from the comparable expenses that we would have incurred had we operated as a stand-alone company. Our historical financial information does not reflect changes that will occur in our cost structure, financing and operations as a result of our transition to becoming a stand -alone public company, including potential increased costs associated with reduced economies of scale and increased costs associated with SEC reporting and Nasdaq requirements. We have made allocations based upon available information and assumptions that we believe are reasonable to reflect these factors, among others, in our historical combined financial data. However, our assumptions may prove not to be accurate, and accordingly, the historical combined financial data presented in this prospectus forms apart should not be assumed to be indicative of what our financial condition or results of operations would have actually been as an independent publicly traded company nor to be a reliable indicator of what our financial condition or results of operations actually may be in the future. We may have difficulty operating as an independent, publicly traded company. As an independent, publicly traded company, we believe that our business will benefit from, among other things, allowing us to better focus our financial and operational resources on our specific business, allowing our management to design and implement corporate strategies and policies that are based primarily on the business characteristics and strategic decisions of our business, allowing us to more effectively respond to Bitcoin market dynamics. However, we may not be able to achieve some or all of the benefits that we believe we can achieve as an independent company in the time we expect, if at all. Because our business has previously operated as part of the wider OLB organization, we may not be able to successfully implement the changes necessary to operate independently and may incur additional costs that could adversely affect our business. As an independent, publicly traded company, we may not enjoy the same benefits that it did as part of OLB. There is a risk that, by separating from OLB, we may become more susceptible to market fluctuations and other adverse events than we would have been if we were still a part of the current OLB s organizational structure. As part of OLB, we have been able to enjoy certain benefits from OLB s operating diversity, available capital for investments and opportunities to pursue integrated strategies with OLB s other businesses. As an independent, publicly traded company, we will not have similar diversity, available capital or integration opportunities and may not have similar access to capital markets. Our ability to meet our capital needs may be harmed by the loss of financial support from OLB. The loss of financial support from OLB could harm our ability to meet our capital needs. After the Spin-Off Distribution, we expect to obtain any funds needed in excess of the amounts generated by our operating activities through the capital markets or bank financing, and not from OLB. However, given the smaller relative size of our company as compared to OLB after the Spin-Off Distribution, we may incur higher debt servicing and other costs than we would have otherwise incurred as a part of OLB. Further, we cannot guarantee you that we will be able to obtain capital market financing or credit on favorable terms, or at all, in the future. We cannot assure you that our ability to meet our capital needs will not be harmed by the loss of financial support from OLB. As a newly-incorporated company, we may not have the surplus or net profits required by law to pay dividends. We have not declared any dividends on our common shares and we may not make dividend payments in the future as we may not earn sufficient revenues or we may incur expenses or liabilities that would reduce or eliminate the cash available for distribution as dividends. Our loan agreements may also limit the amount of dividends we can pay under some circumstances. The declaration and payment of any dividends on our common shares will be subject at all times to the discretion of our Board of Directors. The timing and amount of dividends will depend on our earnings, financial condition, cash requirements and availability, restrictions in our loan agreements, growth strategy, the price of Bitcoin, the provisions of Delaware law affecting the payment of dividends and other factors. Delaware law generally prohibits the payment of dividends other than from surplus (retained earnings and the excess of consideration received for the sale of shares above the par value of the shares), but, if there is no surplus, dividends may be declared out of the net profits (basically, the excess of our revenue over our expenses) for the fiscal year in which the dividend is declared or the preceding fiscal year. Delaware law also prohibits the payment of dividends while a company is insolvent or if it would be rendered insolvent upon the payment of a dividend. As a newly incorporated company, we may not have the required surplus or net profits to pay dividends, or our Board of Directors may determine to not declare any dividends for the foreseeable future. 25 We believe that the Spin-Off Distribution generally will be taxable to our shareholders for U.S. federal income tax purposes. For U.S. federal income tax purposes, if a corporate division, such as the Spin-Off Distribution qualifies for tax-free treatment under Section 355 of the Code, the distribution of our common shares to OLB s stockholders would generally not be taxable as a distribution and shareholders would allocate a portion of their tax basis in their OLB shares to the common shares received in the Spin-Off Distribution. However, we do not expect to satisfy all of the requirements of Section 355 of the Code. Therefore, we expect that the Spin-Off Distribution generally will be taxable to our shareholders for U.S. federal income tax purposes. The tax treatment of the Spin-Off Distribution is discussed below at "Tax Considerations – U.S. Federal Income Tax Treatment of the Spin-Off Distribution". Certain of our directors and executive officers are director and/or executive officers of OLB and own shares of its common stock, which could cause conflicts of interests. Ronny Yakov, our Chief Executive Officer and Chairman of the Board of Directors owns a substantial amount of OLB common stock. The interests of our Chief Executive Officer and Chairman of the Board of Directors and other directors and officers in common stock of OLB and the presence of certain of OLB executives and directors on our board of directors could create, or appear to create, conflicts of interest with respect to matters involving both us and OLB that could have different implications for OLB than they do for us. As a result, we may be precluded from pursuing certain opportunities on which we would otherwise act, including growth opportunities. We do not intend to adopt specific policies or procedures to address conflicts of interests that may arise as a result of certain of our directors and officers owning OLB common stock or our President and Chief Executive Officer and other directors being an executive officer and/or director of OLB. However, prior to consummation of the Spin-Off Distribution, we will adopt a Related Person Transactions Policy to provide guidance in identifying, reviewing and, where appropriate, approving or ratifying transactions with related persons. Following the Spin-Off Distribution, it is anticipated that Mr. Yakov will continue to serve as interim Chief Executive Officer, on a part-time basis along with his duties with OLB, until a full-time chief executive officer is hired and that Mr. Smith will continue to serve as interim Chief Financial Officer, on a part-time basis along with his duties with OLB, until a full-time chief financial officer. There can be no assurances how long it will take for the company to obtain a permanent chief executive officer and chief financial officer. As an "emerging growth company" under applicable law, we will be subject to lessened disclosure requirements, which could leave our stockholders without information or rights available to stockholders of more mature companies. For as long as we remain an "emerging growth company", we have elected to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to: not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act; taking advantage of an extension of time to comply with new or revised financial accounting standards; reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements; and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. We expect to take advantage of these reporting exemptions until we are no longer an "emerging growth company." Because of these lessened regulatory requirements, our stockholders would be left without information or rights available to stockholders of more mature companies. 26 CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This prospectus contains "forward-looking statements" within the meaning of the federal securities laws, and that involve significant risks and uncertainties. Words such as "may," "should," "could," "would," "predicts," "potential," "continue," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," and similar expressions, as well as statements in future tense, identify forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results and may not be accurate indications of when such performance or results will be achieved. Forward -looking statements are based on information we have when those statements are made or management s good faith belief as of that time with respect to future events, and are subject to significant risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Important factors that could cause such differences include, but are not limited to: We operate in a regulatory environment that is evolving and uncertain and any changes to regulations could have a material impact on our business and financial condition; We rely on a combination of confidentiality clauses, assignment agreements and license agreements with employees and third parties, trade secrets, copyrights and trademarks to protect our intellectual property and competitive advantage, all of which offer only limited protection meaning that we may be unable to maintain and protect our intellectual property rights and proprietary information or prevent third-parties from making unauthorized use of our technology; and Our growth may not be sustainable and depends on our ability to increase the number of mining computers. The foregoing does not represent an exhaustive list of matters that may be covered by the forward-looking statements contained herein or
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+PROSPECTUS SUMMARY
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+ This summary provides highlights of selected information contained in this prospectus. It does not contain all the information you should consider before investing in the shares we are offering. Before making an investment decision, you should read the entire prospectus carefully and thoroughly, including the Risk Factors section, the financial statements and the notes to the financial statements. 
+ 
+ Calor Del Sol Inc. is a company with nominal operations and has assets consisting solely of cash and cash equivalents, therefore making it a shell company. Consequently, there will be illiquidity of any future trading market until the market is no longer considered a shell company. 
+ 
+ Calor Del Sol Inc., since incorporation, has not made any purchase or sale of assets, nor has it been involved in any mergers, acquisitions or consolidations nor has the Company have any plans nor does any of its stockholders have any plans to merge into an operating company, to enter into a change of control or similar transaction or to change our management. Neither the management nor the Company s shareholders have plans or intentions to be acquired. Calor Del Sol Inc. is not a blank check registrant as that term is defined in Rule 419(a)(2) of Regulation C of the Securities Act of 1933, since it has a specific business plan or purpose. 
+ 
+ The Company s CEO, Alejandro Hernandez, holds all 4,000,000 outstanding shares of common stock and Mr. Hernandez will continue to hold a majority of outstanding shares even if all shares in the offering are sold. Mr. Hernandez will hold 57.14% of The Company s common stock if all 3,000,000 shares offered are sold and he will have the ability to control the outcome of matters requiring shareholder approval. 
+ 
+ THE COMPANY
+ 
+ Calor Del Sol Inc. is an emerging growth stage company which intends to manufacture and sell beautiful, functional and multiuse lingerie items that can be worn as undergarments or as clothing. We currently have no product to sell, but we intend to create items made of quality material meant to last and keep their original integrity. The items will consist of a wide range of neutral toned basics with material and fabrics that will be wrinkle and stain resistant, easy to wash and no dry cleaning necessary. Calor Del Sol Inc. was incorporated in Nevada on May 24, 2022. We intend to use the net proceeds from this offering to operate our business only until Stage 1 of our Plan of Operation. We have no revenues or operating history. Our principal business offices are 1400 112th Ave SE, Suite 100, Bellevue, WA 98004. Calor Del Sol Inc. s phone number is (800) 641-4814.
+ 
+ From inception until the date of this filing, we have had no operating activities. Our financial statements from the year ended April 30, 2025 and for the period ended July 31, 2025 reports no revenues and a net loss of $11,338. Our independent registered public accountant has issued an audit for Calor Del Sol Inc. which includes a statement expressing substantial doubt as to our ability to continue as a going concern. As of July 31, 2025, the Company has a working capital deficit of $52,036. 
+ 
+ Calor Del Sol Inc. anticipates that it will derive its income from the sale of its intended products of multi-use lingerie items. We do not anticipate revenues until such time as we enter into retail operations, which is defined as activities which involves the buying and selling of our proposed multiuse lingerie items in exchange for compensation. We anticipate being in commercial operations within 12 to 18 months of closing this offering. Anticipated expenditures over the next twelve months are estimated to be $90,000. Since we are presently in the development stage of our business, we can provide no assurance that we will successfully assemble, manufacture and sell any products or services related to our planned activities. Further, we cannot provide investors with any assurance that we will be able to raise sufficient funds during Phase 2 to proceed with any work or activities. 
+ 
+ 
+ 6
+ 
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+ Table of Contents
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+ MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
+ 
+ Our cash balance is $(89.00) as of July 31, 2025. We believe our cash balance is not sufficient to fund our limited levels of operations for any period of time. We have been utilizing and may utilize funds from Alejandro Hernandez, our President and Chief Executive Officer, Chairman of the Board of Directors, and majority holder of our common stock, who has verbally agreed to advance funds to complete this offering which will allow us to pay for offering costs, filing fees, and professional fees. In order to develop and begin to implement our business plan, we will need the funding from this offering. We are a development stage company and have generated no revenue to date. We have sold 4,000,000 shares of common stock, at $0.001 per share for net proceeds of $4,000 to Mr. Hernandez, our principal officer and sole director.
+ 
+ Our independent registered public accountant has issued a going concern opinion. This means that there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional capital to pay our bills. This is because we have not generated revenues and no revenues are anticipated until we begin selling our proposed line of lingerie items. There is no assurance we will ever reach that Phase.
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+PROSPECTUS SUMMARY The following summary is qualified in its entirety by, and should be read in conjunction with, the more detailed information and financial statements included elsewhere in this prospectus. In addition to this summary, we urge you to read the entire prospectus carefully, especially the risks of investing in our Ordinary Shares, discussed under "Risk Factors," before deciding whether to invest in our Ordinary Shares. We are a holding company incorporated in the Cayman Islands. Our Ordinary Shares offered in this prospectus are shares of our Cayman Islands holding company. As a holding company with no material operations of our own, we conduct our operations through the PRC operating entities. Our Corporate Structure Corporate Structure Our Ordinary Shares offered in this offering are shares of Qingmin Cayman, the offshore holding company in the Cayman Islands. As a result, a substantial majority of our operations are conducted by the PRC operating entities. The Ordinary Shares offered in this prospectus are shares of the Cayman Islands holding company and not shares of the PRC operating entities. Holders of our Ordinary Shares do not directly own any equity interests in the PRC operating entities, but will instead own shares of a Cayman Islands holding company. The Chinese regulatory authorities could disallow our corporate structure, which would likely result in a material change in our operations and/or a material change in the value of our Ordinary Shares, including that it could cause the value of our Ordinary Shares to significantly decline or become worthless. See "Risk Factors — Risks Relating to Doing Business in the PRC — The Chinese government may intervene or influence our operations at any time. Furthermore, recent statements by the Chinese government indicate an intent to exert more oversight and control over offerings that are conducted overseas, which actions may result in a material change in our operations and impact our operations materially and adversely, and significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our Ordinary Shares to significantly decline or be worthless." The following diagram illustrates our corporate structure upon the completion of this offering based on 6,250,000 Ordinary Shares being offered, assuming no exercise of the over-allotment option. 1 QMSK Technology Co., Ltd (Qingmin Cayman) Cayman IslandsQMSK (LINK) Technology Co., Ltd (Qingmin BVI) British Virgin IslandsQingmin Digital Science (Qingdao) Enterprise Management Co., Ltd (Qingmin WFOE I) PRCInside PRCOutside PRCDyasin Eternity Holding Limited British Virgin Islands(1)Pre-offering/Post-offeringEquity InterestsMinority Shareholders (2)Public ShareholdersQMSK (HK) Technology Co., Limited (Qingmin HK) Hong Kong86.50%/61.06% 13.50%/9.53%Qingmin Digital Science Co., Ltd (Qingmin Digital) PRCQingmin (Shanghai) Automotive Service Co., Ltd. (Qingmin Shanghai) PRCQingmin Kehui (Qingdao) Brand Operation Co., Ltd. (Qingmin Kehui) PRC0%/29.41%Qingmin Digital Science (Qingdao) Technology Service Co., Ltd (Qingmin Technology) PRC100%100%100%100%100%100%Qingmin Digital Science (Beijing) Commerce Management Co., Ltd (Qingmin WFOE II) PRCQingmin Wei Lan (Beijing) Technology Co., Ltd (Qingmin Wei Lan) PRC100%100% Note: (1) Represents 12,975,000 Ordinary Shares indirectly held by Mr. Yaxin Dong, our Chief Executive Officer, Director, and Chairman of the board of director of the Company, the 100% owner of Dyasin Holding Limited, which is the 100% owner of Dyasin Eternity Holding Limited, as of the date of this prospectus. (2) Represents 2,025,000 Ordinary Shares held by 3 corporate shareholders, each one of which holds less than 5% of our total voting power, as of the date of this prospectus. Overview We are a holding company incorporated in the Cayman Islands. Through our PRC operating entities, we provide comprehensive business solutions to enterprise customers in the insurance industry, mainly auto insurance third-party service providers and insurance companies in China. Auto insurance third-party service providers are companies providing various services to auto insurance companies, such as aftermarket services and brokerage services. Leveraging our in-depth knowledge of the auto insurance industry amassed since the inception of our PRC operating entities in 2013, we specialize in providing auto insurance aftermarket services, primarily (i) insurance risk assessment service, and (ii) value-added services, such as vehicle safety inspection services and vehicle maintenance services. In addition, we also provide other scenario-based customized services, such as IT services and promotional services, on a case-by-case basis. For the fiscal years ended March 31, 2025 and March 31, 2024, we provided services for a total of 64 and 35 enterprise customers, respectively. Some of our customers are well-known major insurance companies in China. All of our revenues have been and will continue to be derived from the Chinese mainland in the foreseeable future. According to the National Financial Regulatory Administration ("NFRA"), the Chinese motor vehicle insurance category was the largest category of property insurance by premium in China, and it reached US$123.1 billion in total premiums in 2023. According to Frost and Sullivan, in 2023, China s car ownership reached 329 million, which generated substantial demand for China s auto insurance and auto insurance third-party services. According to Frost and Sullivan, the market size of auto insurance market is anticipated to increase from US$107.4 billion in 2023 to US$145.5 billion in 2028, depicting a CAGR of 6.3%, and the size of the PRC auto insurance third-party services market, which consists of independent service providers that offer specialized support to auto insurance companies and intermediaries, is anticipated to increase from US$11.8 billion in 2023 to US$17.1 billion in 2028, depicting a CAGR of 7.7%. We believe the anticipated growth of the PRC auto insurance third-party services market presents a great opportunity for us to continually grow and expand our business. 2 We believe our strong technical capabilities have helped drive our growth. Since 2013, our PRC operating entities have been providing IT services for enterprise customers in the insurance industry. In recent years, although we have been focusing on providing auto insurance risk assessment and value-added services, we have continued to provide IT services on a case-by-case basis. Our in-house technical team, which consists of 12 full-time employees as of the date of this prospectus, has developed a proprietary system, namely, "Qingmin Service Platform," or "QMSP," that interfaces with our enterprise customers systems to facilitate the processes of our aftermarket services. Through QMSP, our enterprise customers can place orders for after-market services, verify status of the services, and settle payment for completed services. Our enterprise customers can also use QMSP to generate individualized risk assessment reports based on specific information, such as a driver s age and gender, a vehicle s brand, model, and age, accident history, and claim history. Going forward, we are committed to continuously investing in our technical capabilities to further enhance the marketability of our services. We have established an extensive service network throughout China by collaborating with external vendors. To remain flexible and efficient in our operations, we have adopted a strategy of outsourcing services to external vendors. For our aftermarket services, we collaborate with aftermarket service platform operators. Our service platform operator partners work directly with individual aftermarket service providers, such as auto dealerships, brick-and-mortar repair and maintenance shops, and 4S stores (shops that offer four key vehicle-related services: sales, spare parts, service, and survey), to perform (i) risk assessment services for insurance companies, and (ii) value added-services for car owners, who enjoy such services purchased by the insurance companies as a way to reinforce customer loyalty. Once our enterprise customers order aftermarket services through QMSP, they can access our service providers on QMSP based on specific geographical locations and service types. As of the date of this prospectus, we offer a wide range of aftermarket services through our service network, at 10,651 service locations in 30 province-level municipalities in China. We believe our extensive service network backed by QMSP service processes has attracted more customers, including other aftermarket service providers and insurance companies. Having other aftermarket service providers as our customers has significantly expanded our business scope, because each of our aftermarket service provider customers works with multiple insurance company customers. For our scenario-based customized services, we selectively outsource certain tasks and projects to external vendors. Many of these vendors are our business partners with whom we have established enduring collaborations. Competitive Strengths We believe that the following competitive strengths have contributed to our success and differentiated us from our competitors: In-depth Knowledge of the Insurance Industry Strong In-house Technical Capabilities Extensive Service Network throughout China Visionary Management Team and Qualified Workforce Growth Strategies We intend to develop our business and strengthen brand loyalty by pursuing the following strategies: Accelerate Marketing and Sales Efforts 3 Enhancing Value for Customers Continue to Attract, Incentivize and Retain Talented Professionals Continue to Invest in In-house Technical Capabilities Corporate Information Our principal executive offices are located Room 405, SIIC T6, Xianggang East Road, Laoshan District, Qingdao, Shandong Province, China, and our phone number is (086)-155-522-23924. Our registered office in the Cayman Islands is located at 4th Floor, Harbour Place, 103 South Church Street, P.O. Box 10240, Grand Cayman KY1-1002, Cayman Islands, and the phone number of our registered office is +1 (345) 949-8599. We maintain a corporate website at www.qmsk.work. The information contained in, or accessible from, our websites or any other website does not constitute a part of this prospectus or the registration statement of which this prospectus forms a part. Our agent for service of process in the U.S. is Cogency Global Inc., located at 122 East 42nd St, 18th Floor, New York, NY 10168. Summary of Risk Factors Investing in our Ordinary Shares involves significant risks. You should carefully consider all of the information in this prospectus before making an investment in our Ordinary Shares. Below please find a summary of the principal risks we face, organized under relevant headings. These risks are discussed more fully in the section titled "Risk Factors." Risks Relating to Doing Business in the PRC (for a more detailed discussion, see "Risk Factors—Risks Relating to Doing Business in the PRC") Changes in the Chinese mainland s economic, social conditions, or government policies could have a material adverse effect on our business and operations (see the risk factor under the same title). The enforcement of laws and rules and regulations in the Chinese mainland may change quickly with little advance notice conveyed to us, in which case we might have limited time to ensure timely compliance upon the enactment of such revisions, and there is a risk that the Chinese government may be authorized by the PRC laws and regulations to exercise significant oversight over the offerings that are conducted overseas, which could materially and adversely affect our business and hinder our ability to offer our securities or continue our operations, and cause the value of our securities to significantly decline or become worthless (see the risk factor under the same title). The Chinese government may intervene or influence our operations at any time. Furthermore, recent statements by the Chinese government indicate an intent to exert more oversight and control over offerings that are conducted overseas, which actions may result in a material change in our operations and impact our operations materially and adversely, and significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our Ordinary Shares to significantly decline or be worthless (see the risk factor under the same title). Given the Chinese government s regulations on the conduct of the business of the PRC operating entities, the Chinese government may be authorized by PRC laws and regulations to regulate their operations, which could result in a material change in the operations of the PRC operating entities and/or the value of our Ordinary Shares (see the risk factor under the same title). Recent greater oversight by the CAC over data security, particularly for companies seeking to list on a foreign exchange, could adversely impact our business and this offering (see the risk factor under the same title). 4 The approval of the China Securities Regulatory Commission and other compliance procedures may be required in connection with this offering under the M&A Rules, and, if required, we cannot predict whether we will be able to obtain such approval (see the risk factor under the same title). The New Overseas Listing Rules and other relevant rules promulgated by the CSRC may subject us to additional compliance requirements in the future (see the risk factor under the same title). The HFCAA and the Accelerating Holding Foreign Companies Accountable Act call for additional and more stringent criteria to be applied to emerging market companies upon assessing the qualification of their auditors, especially the non-U.S. auditors who are not inspected by the PCAOB. These developments could add uncertainties to this offering and listing on the Nasdaq Capital Market, and Nasdaq may determine to delist our securities if the PCAOB determines that it cannot inspect or fully investigate our auditor (see the risk factor under the same title). Increases in labor costs in the PRC may adversely affect our business and our profitability (see the risk factor under the same title). Changes in international trade policies, or the escalation of tensions in international relations, particularly with regard to China, may adversely impact our business and operating results (see the risk factor under the same title). The PRC operating entities have not made adequate social insurance and housing fund contributions for all employees as required by PRC regulations, which may subject us to penalties (see the risk factor under the same title). PRC regulations relating to offshore investment activities by PRC residents may subject our PRC resident beneficial owners or WFOEs to liability or penalties, limit our ability to inject capital into WFOEs, limit WFOEs ability to increase its registered capital or distribute profits to us, or may otherwise adversely affect us (see the risk factor under the same title). Fluctuations in exchange rates could have a material adverse effect on our results of operations and the value of your investment (see the risk factor under the same title). 5 If we become directly subject to the scrutiny, criticism, and negative publicity involving U.S.-listed Chinese companies, we may have to expend significant resources to investigate and resolve the matter which could harm our business operations, stock price, and reputation (see the risk factor under the same title). The M&A Rules and certain other PRC regulations establish complex procedures for some acquisitions of Chinese companies by foreign investors, which could make it more difficult for us to pursue growth through acquisitions in China (see the risk factor under the same title). There are procedures and requisite timing under the PRC Securities Law for the U.S. securities regulatory agencies to conduct investigations and collect evidence within the territory of the Chinese mainland (see the risk factor under the same title). Failure to obtain or maintain permits necessary for our operations may subject us to regulatory penalties or require us to adjust our business model (see the risk factor under the same title). Our leased property interest or entitlement to other facilities or assets may be defective or subject to lien and our right to lease, own or use the properties affected by such defects or lien challenged, which could cause disruption to our business (see the risk factor under the same title). Risks Relating to Our Corporate Structure and Tax Treatment under PRC Laws and Regulations (for a more detailed discussion, see "Risk Factors—Risks Relating to Our Corporate Structure and Tax Treatment under PRC Laws") Due to the differences in the legal systems of different countries, you may experience difficulties in effecting service of legal process, enforcing foreign judgments, or bringing actions in China against us or our management named in this prospectus based on foreign laws, compared to doing so in your home country against a domestic defendant. It may also be difficult for you or overseas regulators to conduct investigations or collect evidence within China (see the risk factor under the same title). To the extent cash or assets of our business, or of the PRC operating entities or Hong Kong subsidiaries, are in the Chinese mainland or Hong Kong, such cash or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong, due to the imposition of restrictions and limitations by the PRC government to the transfer of cash or assets (see the risk factor under the same title). PRC regulation of parent/subsidiary loans and direct investment by offshore holding companies to PRC entities may delay or prevent us from using the proceeds of this offering to make loans or additional capital contributions to PRC entities, which could materially and adversely affect our liquidity and our ability to fund and expand our business (see the risk factor under the same title). Under the EIT Law, we may be classified as a PRC "resident enterprise" for PRC enterprise income tax purposes. Such classification would likely result in unfavorable tax consequences to us and our non-PRC shareholders and have a material adverse effect on our results of operations and the value of your investment (see the risk factor under the same title). We face uncertainty with respect to indirect transfers of equity interests in PRC resident enterprises by their non-PRC holding companies (see the risk factor under the same title). The requirements and legal procedures of currency conversion may affect the value of your investment and our payment of dividends (see the risk factor under the same title). Dividends payable to foreign investors and gains on the sale of our Ordinary Shares by foreign investors may become subject to PRC tax law (see the risk factor under the same title). Risks Relating to Our Business (for a more detailed discussion, see "Risk Factors—Risks Relating to Our Business") Risks and uncertainties related to our business include, but are not limited to, the following: Our business largely depends on the relationships with our customers. If we cannot maintain good relationships or provide satisfactory services to our customers, our results of operations may be materially and adversely affected (see the risk factor under the same title). We rely on third-party collaborating vendors to operate our business. Failure to establish and maintain cordial relationships with them may adversely affect our results of operations and business prospects (see the risk factor under the same title). If we fail to acquire new customers or retain existing customers, especially the large customers, our business, financial condition and results of operations could be materially and adversely affected (see the risk factor under the same title). Material changes in the regulatory environment could change the competitive landscape of our industry or require us to change the way we conduct business. The administration, interpretation and enforcement of the laws and regulations currently applicable to customers could change rapidly which could negatively impact our financial results (see the risk factor under the same title). Competition in the auto insurance third-party services industry is intense and, if we are unable to compete effectively with both existing and new market participants, we may lose customers, and our financial results may be negatively affected (see the risk factor under the same title). Our future success depends on the continuing efforts of our senior management team and other key personnel, and our business may be harmed if we lose their services (see the risk factor under the same title). We are subject to credit risks from customers (see the risk factor under the same title). 6 We have limited sources of working capital and may need substantial additional financing (see the risk factor under the same title). We may face disruption to our technology systems, if our technology systems or the proprietary information and/or data collected and stored by the PRC operating entities via such systems, particularly billing and client information, were to be accessed or tampered with by unauthorized persons, and, in any such case, our reputation and relationships with our customers could be harmed and our business could be materially and adversely affected (see the risk factor under the same title). Our business model and our planned business developments are dependent on the proper function of our IT systems and infrastructure and our ability to continuously improve our IT systems and infrastructure and adopt advancing technologies. Breakdown of any of our major IT systems or failure to keep up with technological developments would materially and adversely affect our business, results of operations and future prospects (see the risk factor under the same title). Our business is subject to concentration risks arising from dependence on a few large customers (see the risk factor under the same title). Our business is subject to concentration risks with regard to the vendors that we subcontract to provide services to customers (see the risk factor under the same title). Risks Relating to this Offering and the Trading Market (for a more detailed discussion, see "Risk Factors—Risks Relating to this Offering and the Trading Market") In addition to the risks described above, we are subject to general risks and uncertainties relating to this offering and the trading market, including, but not limited to, the following: There has been no public market for our Ordinary Shares prior to this offering, and you may not be able to resell our Ordinary Shares at or above the price you pay for them, or at all (see the risk factor under the same title). You will experience immediate and substantial dilution in the net tangible book value of Ordinary Shares purchased (see the risk factor under the same title). If we fail to implement and maintain an effective system of internal controls or fail to remediate the material weaknesses in our internal control over financial reporting that have been identified, our consolidated financial statements may be materially affected as a result, and investor confidence and the market price of our Ordinary Shares may be materially and adversely affected (see the risk factor under the same title). We will incur substantial increased costs as a result of being a public company (see the risk factor under the same title). Since we are a "controlled company" within the meaning of the Nasdaq listing rules, we may follow certain exemptions from certain corporate governance requirements that could adversely affect our public shareholders (see the risk factor under the same title). Substantial future sales of our Ordinary Shares or the anticipation of future sales of our Ordinary Shares in the public market could cause the price of our Ordinary Shares to decline (see the risk factor under the same title). We do not intend to pay dividends for the foreseeable future (see the risk factor under the same title). If securities or industry analysts do not publish research or reports about our business, or if the publish a negative report regarding our Ordinary Shares, the price of our Ordinary Shares and trading volume could decline (see the risk factor under the same title). The market price of our Ordinary Shares may be volatile or may decline regardless of our operating performance, and you may not be able to resell your shares at or above the initial public offering price (see the risk factor under the same title). Our management has broad discretion to determine how to use the funds raised in the offering and may use them in ways that may not enhance our results of operations or the price of our Ordinary Shares (see the risk factor under the same title). If we cannot satisfy, or continue to satisfy, the initial listing requirements and other rules of the Nasdaq Capital Market, our securities may not be listed or may be delisted, which could negatively impact the price of our securities and your ability to sell them (see the risk factor under the same title). The initial public offering price of our Ordinary Shares may not be indicative of the market price of our Ordinary Shares after this offering. In addition, an active, liquid and orderly trading market for our Ordinary Shares may not develop or be maintained, and our stock price may be volatile (see the risk factor under the same title). We may experience extreme stock price volatility unrelated to our actual or expected operating performance, financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our Ordinary Shares (see the risk factor under the same title). 7 Approvals from the PRC Authorities to Issue Our Ordinary Shares to Foreign Investors On August 8, 2006, six PRC governmental and regulatory agencies, including the China Securities Regulatory Commission, or the CSRC, promulgated the Rules on Acquisition of Domestic Enterprises by Foreign Investors, or the M&A Rules, that became effective on September 8, 2006, and was amended on June 22, 2009. The M&A Rules, among other things, require that offshore special purpose vehicles, or "SPVs", that are controlled by the Chinese mainland companies or individuals and that have been formed for overseas listing purposes through acquisitions of the Chinese mainland domestic interests held by such companies or individuals, shall obtain the approval of the CSRC prior to publicly listing their securities on an overseas stock exchange. See "Risk Factors — Risks Relating to Doing Business in the PRC — The approval of the China Securities Regulatory Commission and other compliance procedures may be required in connection with this offering under the M&A Rules, and, if required, we cannot predict whether we will be able to obtain such approval." Recently, the Chinese government promulgated a series of statements and actions to regulate business operations in China, including cracking down on illegal activities in the securities market, enhancing supervision over China-based companies listed overseas, adopting new measures to extend the scope of cybersecurity reviews, and expanding efforts with respect to anti-monopoly enforcement. For example, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointly issued the "Opinions on Severely Cracking Down on Illegal Securities Activities According to Law," or the "Opinions", which were made available to the public on July 6, 2021. The Opinions emphasized the need to strengthen the administration over illegal securities activities, and the need to strengthen the supervision over overseas listings by Chinese companies. Moreover, the Cyberspace Administration of China, or the "CAC", promulgated the Cybersecurity Review Measure that became effective on February 15, 2022, which extends the scope of cybersecurity review to data processing operators engaging in data processing activities that affect or may affect national security, including listing in a foreign country, and require a mandatory clearance of cybersecurity review to be completed by network platform operators that possess personal information of more than 1 million users. See "Risk Factors — Risks Relating to Doing Business in the PRC — Recent greater oversight by the CAC over data security, particularly for companies seeking to list on a foreign exchange, could adversely impact our business and this offering." In addition, on February 17, 2023, the CSRC promulgated the "Trial Measures" and five supporting guidelines, which became effective on March 31, 2023. Pursuant to the Trial Measures, a PRC domestic company that seeks to offer or list securities overseas, by both direct and indirect means, shall submit the filing materials with the CSRC as required by the Trial Measures within three business days following its submission of an application for its initial public offering or listing to overseas securities authorities. If the PRC domestic company fails to complete the required filing procedures, conceals any material fact, or falsifies any major content in its filing documents, such PRC domestic company may be subject to administrative penalties, such as an order to rectify, warnings, fines, and its controlling shareholders, actual controllers, the person directly in charge and other directly liable persons may also be subject to administrative penalties, such as warnings and fines. According to the Trial Measures, the CSRC shall conclude the filing within 20 business days upon the receipt of the required filing materials, provided the filing materials are complete and in compliance with the Trial Measures. We submitted our filing materials to the CSRC for this offering on July 25, 2024, as required by the Trial Measures. As of the date of this prospectus, our filing materials are currently under the CSRC s review and we have not yet completed the filing procedures with the CSRC. See "Risk Factors — Risks Relating to Doing Business in the PRC — The New Overseas Listing Rules and other relevant rules promulgated by the CSRC may subject us to additional compliance requirements in the future." Based on the opinion of Han Kun and Anli, except for the aforementioned filing with the CSRC, as of the date of this prospectus, we are not required by any currently effective PRC laws or regulations to obtain approval, permission, or clearance from any other PRC authorities to offer or issue our securities to foreign investors, and we have not received any inquiry, notice, warning, sanction, or any regulatory objection to this offering from the CSRC, the CAC, or any other PRC authorities that have jurisdiction over our operations. Further, Anli has advised us that, based on their understanding of the current PRC laws and regulations, as of the date of this prospectus, we and/or the PRC operating entities are not subject to the cybersecurity review by the CAC as stipulated in the Cybersecurity Review Measure, since the PRC operating entities are not deemed to be a critical information infrastructure operator or network platform operator possessing personal information of more than 1 million users. In addition, Han Kun has advised that we and/or the PRC operating entities are not subject to the CSRC approval in the context of this offering as required under M&A Rules, as we formed our WFOEs, by way of equity investment rather than by a merger with or acquisition of a PRC company. 8 Furthermore, it is highly uncertain what existing or new laws or regulations or implementations and interpretations will be modified or promulgated, if any, and the potential impact such modified or new laws and regulations will have on our business operation, our ability to accept foreign investments or list on a U.S. exchange. There is a possibility that we could have inadvertently concluded that we are not subject to such review or approval. We cannot assure you that we or our PRC operating entities would be able to obtain clearance from the CAC if we are deemed to be subject to cybersecurity review in the future. If we are unable to complete the filings with the CSRC, obtain such approval if required in the future, or inadvertently conclude that such approval or clearance is not required, our ability to offer or continue to offer our Ordinary Shares to investors could be significantly limited or completely hindered, and the value of our Ordinary Shares may depreciate significantly or become worthless. See "Risk Factors — Risks relating to doing business in China." Approvals from the PRC Authorities to Conduct Our Operations As of the date of this prospectus, based on the opinion of Han Kun and Anli, we believe we and the PRC operating entities have received from the PRC authorities all requisite licenses, permissions, or approvals that are required for conducting our current operations as of the date of this prospectus in China, including business licenses for our PRC operating entities. Business licenses are subject to renewal from time to time when the PRC operating entities change certain information, such as name of the company, name of the legal representative, business scope, registered capital and/or registered address. We and the PRC operating entities have not been denied any such approvals or permissions. However, our PRC legal counsel has further advised us that it is uncertain whether we or the PRC operating entities will be required to obtain additional approvals, licenses, or permits in connection with our business operations pursuant to evolving PRC laws and regulations, and whether we would be able to obtain and renew such approvals on a timely basis or at all. If (i) we do not receive or maintain such permissions or approvals, (ii) we inadvertently conclude that such permissions or approvals are not required, or (iii) applicable PRC laws, regulations, or their interpretations change and we are required to obtain such permissions or approvals in the future, we may be subject to fines or other penalties, including suspension of business and revocation of prerequisite licenses, which could result in a material change in our operations, and may have a material adverse effect on our business, financial condition or results of operations, and the value of our Ordinary Shares could depreciate significantly or become worthless. See "Risk Factors — Risks Relating to Doing Business in the PRC — The Chinese government may intervene or influence our operations at any time. Furthermore, recent statements by the Chinese government indicate an intent to exert more oversight and control over offerings that are conducted overseas, which actions may result in a material change in our operations and impact our operations materially and adversely, and significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the value of our Ordinary Shares to significantly decline or be worthless." Dividends or Distributions Made to our Company and U.S. Investors and Tax Consequences As of the date of this prospectus, none of the operating entities have made any dividends or distributions to our Company and our Company has not made any dividends or distributions to our shareholders. We intend to keep any future earnings to finance the expansion of our business, and we do not anticipate that any cash dividends will be paid in the foreseeable future. As such, we do not have any cash management policies that dictate how funds are transferred among the Company and our subsidiaries. Subject to the passive foreign investment company ("PFIC") rules, the gross amount of distributions we make to investors with respect to our Ordinary Shares (including the amount of any taxes withheld therefrom) will be taxable as a dividend, to the extent that the distribution is paid out of our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Because we do not intend to calculate our earnings and profits under U.S. federal income tax principles, investors should expect that any distributions will be treated as dividends for U.S. federal income tax purposes. Under the Cayman Islands law, a Cayman Islands company may pay a dividend on its shares out of either profit or share premium amount, provided that in no circumstances may a dividend be paid if this would result in the company being unable to pay its debts due in the ordinary course of business. If we determine to pay dividends on any of our Ordinary Shares in the future, as a holding company, we will depend on receipt of funds from PRC operating entities to our WFOEs. Pursuant to the EIT Law and its implementation rules, any dividends paid by our WFOEs to Qingmin HK will be subject to a withholding tax rate of 10%. However, if Qingmin HK is determined by the relevant PRC tax authority to have satisfied the relevant conditions and requirements under the arrangement between the Chinese mainland and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and Tax Evasion on Income, or the "Double Tax Avoidance Arrangement," and other applicable laws, the 10% withholding tax on the dividends Qingmin HK receives from each of our WFOEs may be reduced to 5%. See "Risk Factors—Risks Relating to Our Corporate Structure and Tax Treatment under PRC Laws and Regulations — Under the EIT Law, we may be classified as a PRC "resident enterprise" for PRC enterprise income tax purposes. Such classification would likely result in unfavorable tax consequences to us and our non-PRC shareholders and have a material adverse effect on our results of operations and the value of your investment." 9 Current PRC regulations permit each of our WFOEs to pay dividends to Qingmin HK only out of its accumulated profits, if any, determined in accordance with Chinese accounting standards and regulations. In addition, each of our WFOEs is required to set aside at least 10% of its after-tax profits each year, if any, to fund a statutory reserve until such reserve reaches 50% of its registered capital. Each of such entity in the PRC is also required to further set aside a portion of its after-tax profits to fund the employee welfare fund, although the amount to be set aside, if any, is determined at the discretion of its board of directors. Although the statutory reserves can be used, among other ways, to increase the registered capital and eliminate future losses in excess of retained earnings of the respective companies, the reserve funds are not distributable as cash dividends except in the event of liquidation. Furthermore, if our subsidiaries in the PRC incur debt on their own in the future, the instruments governing the debt may restrict their ability to pay dividends or make other payments. If we or our subsidiaries are unable to receive all of the revenue from our operations, we may be unable to pay dividends on our Ordinary Shares. Under existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest payments, and trade and service-related foreign exchange transactions, can be made in foreign currencies, without prior approval of State Administration of Foreign Exchange ("SAFE"), by complying with certain procedural requirements. Specifically, without prior approval of SAFE, cash generated from the operations in the PRC may be used to pay dividends to our Company. As of the date of this prospectus, our WFOEs have completed the foreign exchange registration related to our Company under the existing PRC foreign exchange regulations, which enables them to legally distribute their earnings to our Company. Implications of Our Being an "Emerging Growth Company" As a company with less than $1.235 billion in revenue during our last fiscal year, we qualify as an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2012, or the "JOBS Act." An "emerging growth company" may take advantage of reduced reporting requirements that are otherwise applicable to larger public companies. In particular, as an emerging growth company, we: may present only two years of audited financial statements and only two years of related Management s Discussion and Analysis of Financial Condition and Results of Operations; are not required to provide a detailed narrative disclosure discussing our compensation principles, objectives and elements and analyzing how those elements fit with our principles and objectives, which is commonly referred to as "compensation discussion and analysis"; are not required to obtain an attestation and report from our auditor on our management s assessment of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002; are not required to obtain a non-binding advisory vote from our shareholders on executive compensation or golden parachute arrangements (commonly referred to as the "say-on-pay," "say-on frequency" and "say-on-golden-parachute" votes); are exempt from certain executive compensation disclosure provisions requiring a pay-for-performance graph and CEO pay ratio disclosure; are eligible to claim longer phase-in periods for the adoption of new or revised financial accounting standards under 107 of the JOBS Act; and will not be required to conduct an evaluation of our internal control over financial reporting until our second annual report on Form 20-F following the effectiveness of our initial public offering. We intend to take advantage of all of these reduced reporting requirements and exemptions, and delay the adoption of new or revised financial accounting standards under 107 of the JOBS Act. 10 Under the JOBS Act, we may take advantage of the above-described reduced reporting requirements and exemptions until we no longer meet the definition of an emerging growth company. The JOBS Act provides that we would cease to be an "emerging growth company" at the end of the fiscal year in which the fifth anniversary of our initial sale of common equity pursuant to a registration statement declared effective under the Securities Act of 1933, as amended (the "Securities Act"), occurred, if we have more than $1.235 billion in annual revenue, have more than $700 million in market value of our Ordinary Shares held by non-affiliates, or issue more than $1 billion in principal amount of non-convertible debt over a three-year period. Foreign Private Issuer Status We are a foreign private issuer within the meaning of the rules under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). As such, we are exempt from certain provisions applicable to U.S. domestic public companies. For example: we are not required to provide as many Exchange Act reports, or as frequently, as a domestic public company; for interim reporting, we are permitted to comply solely with our home country requirements, which are less rigorous than the rules that apply to domestic public companies; we are not required to provide the same level of disclosure on certain issues, such as executive compensation; we are exempt from provisions of Regulation FD aimed at preventing issuers from making selective disclosures of material information; we are not required to comply with the sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations in respect of a security registered under the Exchange Act; and we are not required to comply with Section 16 of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and establishing insider liability for profits realized from any "short-swing" trading transaction. Controlled Company Upon the completion of this offering, Mr. Yaxin Dong, the Chief Executive Officer of the Company, through his beneficial ownership of 12,975,000 Ordinary Shares, will beneficially own approximately 61.06% of the aggregate voting power, assuming no exercise of the over-allotment option, or approximately 58.48%, assuming full exercise of the over-allotment option. As long as Mr. Yaxin Dong continues to beneficially own more than 50% of the total voting power of the Company, he will have the ability to control the outcome of matters submitted to shareholders for approval as ordinary resolutions, including the appointment and removal of directors and declaring dividends, pursuant to the Company s post-offering memorandum and articles of association. However, Mr. Yaxin Dong will not have the ability to control the outcome of certain matters submitted to shareholders for approval as special resolutions, such as the amendment of the Company s memorandum and articles of association, since he will not beneficially own more than two-thirds of the Company s total voting power. We will be deemed a "controlled company" under Nasdaq Marketplace Rules 5615(c). As a controlled company, we are permitted to elect to rely on certain exemptions from the obligations to comply with certain corporate governance requirements, including: the requirement that our director nominees be selected or recommended solely by independent directors; and the requirement that we have a nominating and corporate governance committee and a compensation committee that are composed entirely of independent directors with a written charter addressing the purposes and responsibilities of the committees. Although we do not intend to rely on the controlled company exemptions under the Nasdaq listing rules even if we are deemed to be a controlled company, we could elect to rely on these exemptions in the future, and if so, you would not have the same protection afforded to shareholders of companies that are subject to all of the corporate governance requirements of Nasdaq. 11
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+PROSPECTUS SUMMARY 1 RISK FACTORS 12 SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS 47 USE OF PROCEEDS 48 Dividend Policy 49 CAPITALIZATION 50 DILUTION 51 EXCHANGE RATE INFORMATION 53 ENFORCEABILITY OF CIVIL LIABILITIES 54 CORPORATE HISTORY AND STRUCTURE 56 MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 57 INDUSTRY OVERVIEW 70 BUSINESS 79 REGULATIONS 84 MANAGEMENT 97 PRINCIPAL SHAREHOLDERS 102 RELATED PARTY TRANSACTIONS 103 DESCRIPTION OF SHARE CAPITAL 105 SHARES ELIGIBLE FOR FUTURE SALE 110 TAXATION 112 UNDERWRITING 118 EXPENSES RELATING TO THIS OFFERING 126 LEGAL MATTERS 126 EXPERTS 126 WHERE YOU CAN FIND ADDITIONAL INFORMATION 127 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS F-1 i About this Prospectus You should rely only on the information contained in this prospectus or in any related free-writing prospectus. We have not authorized anyone to provide you with information different from that contained in this prospectus or any free-writing prospectus. We are offering to sell, and seeking offers to buy, the Ordinary Shares only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is current only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Ordinary Shares. For investors outside the United States, neither we nor the Underwriter have done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction, other than the United States, where action for that purpose is required. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of the Ordinary Shares and the distribution of this prospectus outside the United States. We were incorporated under the laws of the Cayman Islands as an exempted company with limited liability and all of our outstanding securities are owned by non-U.S. residents prior to this offering. Under the rules of the SEC, we currently qualify for treatment as a "foreign private issuer." As a foreign private issuer, we will not be required to file periodic reports and financial statements with the SEC as frequently or as promptly as domestic registrants whose securities are registered under the Securities Exchange Act of 1934. Until and including , 2025 (25 days after the date of this prospectus), all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions. You should rely only on the information contained in this prospectus and any free writing prospectus we may authorize to be delivered to you. Neither we nor the Underwriter have authorized anyone to provide you with information different from, or in addition to, that contained in this prospectus and any related free writing prospectus. We and the Underwriter take no responsibility for and can provide no assurances as to the reliability of any information that others may give you. This prospectus is not an offer to sell, nor is it seeking an offer to buy, these securities in any jurisdiction where the offer or sale is not permitted. The information contained in this prospectus is only accurate as of the date of this prospectus, regardless of the time of delivery of this prospectus and any sale of our Ordinary Shares. Our business, financial condition, results of operations and prospects may have changed since that date. ii Other Pertinent Information Unless otherwise indicated or the context requires otherwise, references in this prospectus to: "China" or the "PRC" are to the People s Republic of China, excluding Taiwan and the special administrative regions of Hong Kong and Macau for the purposes of this prospectus only, while legal and operational risks associated with operating in China also apply to operations in Hong Kong and Macau; "EIT" is to PRC enterprise income tax; "Exchange Act" are to the Securities and Exchange Act of 1934, as amended; "HengCheng" are to Hainan HengCheng Health Industrial Co., Ltd., a wholly owned subsidiary of HengXiong incorporated under the laws of the People s Republic of China; "HengHong HK" are to China HengHong Group Limited, a wholly owned subsidiary of HengHong Technology incorporated under the laws of Hong Kong; "HengHong Technology," "we," "us," "our company," "the Company" and "our" are to HengHong Technology Inc., a Cayman Islands exempted company with limited liability and its subsidiaries; "HengRong" are to Hainan HengRong Health Industrial Co., Ltd. a wholly owned subsidiary of HengHong HK incorporated under the laws of the People s Republic of China; "HengXiong" are to Hainan HengXiong Health Technology Co. Ltd. a wholly owned subsidiary of HengRong incorporated under the laws of the People s Republic of China; "MOFCOM" are to the Ministry of Commerce of the PRC; "Ordinary Share(s)" are to our Ordinary Shares with a par value of US$0.0001 per share; "PCAOB" are to Public Company Accounting Oversight Board; "RMB" and "Renminbi" are to the legal currency of China; "SAFE" are to the State Administration of Foreign Exchange; "Securities Act" to the Securities Act of 1933, as amended; "U.S." are to the United States of America; "US$," "U.S. dollars," "$" and "dollars" are to the legal currency of the United States; "VIE" are to variable interest entity; and "WFOE" are to Hainan HengRong Health Industrial Co., Ltd., a company incorporated under the laws of China and a wholly owned subsidiary of HengHong HK. Unless the context indicates otherwise, all information in this prospectus assumes no exercise by the Underwriter of its over-allotment option. Our business is conducted by our subsidiaries in the PRC, using Renminbi ("RMB"), the currency of China. Our reporting currency is Renminbi. This prospectus also contains translations of certain foreign currency amounts into U.S. dollars for the convenience of the reader. Unless otherwise stated, all translations from Renminbi to U.S. dollars are made at a rate of RMB7.2993 to US$1.00 the exchange rate in effect as of December 31, 2024, as set forth in the H.10 statistical release of The Board of Governors of the Federal Reserve System. We make no representation that any Renminbi or U.S. dollars amounts referred to in this prospectus could have been or could be converted into U.S. dollars or Renminbi, as the case may be, at any particular rate, or at all. Due to rounding, numbers presented throughout this prospectus may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures. iii PROSPECTUS SUMMARY This summary highlights certain information contained elsewhere in this prospectus. You should read the entire prospectus carefully, including our financial statements and related notes and the risks described under "Risk Factors" beginning on page 12. We note that our actual results and future events may differ significantly based upon a number of factors. This prospectus contains information from an industry report commissioned by us dated [ ] and prepared by Storm Harbour Securities, an independent research firm, to provide information regarding our industry and our market position in China. We refer to this report as the "Storm Harbour Report" The reader should not put undue reliance on the forward-looking statements in this document, which speak only as of the date on the cover of this prospectus. Overview We are a holding company incorporated in the Cayman Islands. Our ordinary shares offered in this prospectus are shares of our Cayman Islands holding company. As a holding company with no material operations of our own, we conduct our business through our operating subsidiaries in China, primarily Hainan HengCheng Health Industrial Co. Ltd. We own 100% equity interest of all our subsidiaries including the operating subsidiaries in China and do not have a VIE structure. We, primarily through Hainan HengCheng Health Industrial Co., Ltd., are engaged in the business of distribution of pharmaceutical products in China. We generate our revenue mostly from the distribution of traditional Chinese medicines and chemical medical products, and also from providing promotion and marketing services. The Company only provides promotion and marketing services to one customer, which is also a related party - Shaanxi Hengcheng Pharmaceutical Co., Ltd. for its pharmaceutical products by leveraging the sales and distribution network of the Company, however, due to change of the Company s strategy, the management decided to cease providing such services starting in May 2025, and focusing on new products promotion and sales, e.g. raw materials and tonic medicinal liquors, etc. Since our establishment, we have been focusing on the promotion and marketing of treatment and tonic traditional Chinese medicines. At present, treatment Chinese medicines are our major products, mostly for cold, flu and cough treatment, e.g. Ganmao Qingre Granules ( ), Fenghan Ganmao Granules ( ), Yinqiao Jiedu Granules ( ), etc. Tonic medicines mainly include invigorating spleen granules for nourishing blood and tranquilizing nerves, pulse activating granules for nourishing yin and fluid, qi and blood nourishing, Shouwu Bushen tonic for tonifying kidney and essence, and Zhuangyao Jianshen pills for strengthening waist and kidney. In the future, we plan to increase our depth and strength in the promotion and marketing of tonic products, exploit the market potential of tonic products such as Zhuangyao Jianshen Pill, Suoxian Bushen Oral Liquid, Qizi Tianjing Oral Liquid, and build a series of medicinal liquor products, including Shouwu Bushen liquor, Morinda Officinal tonic liquor, Maoji Blood Tonic liquor, and Huichun tonic liquor. The main products that we sell are Chinese medicines for cold, flu and cough, normally the demand is slightly higher during the flu season which is in winter and early spring. Our revenue decreased by RMB 63,758,620 or 24.1%, from RMB 264,117,663 for the year ended December 31, 2023 to RMB 200,359,043 (US$ 27,449,077) for the year ended December 31, 2024. Our net income decreased by RMB 7,147,215, or 31.9%, from RMB 22,387,571 for the year ended December 31, 2023 to approximately RMB 15,240,356 (US$ 2,087,921) for the year ended December 31, 2024. Our operating subsidiaries are incorporated and operating in mainland China and they have received all required permissions from Chinese authorities, based on the advice of Allbright Law Offices, our PRC counsel, to operate their current business in China, including a business license, a Bank Account Open Permit, a Medicine Operation Permit, and a Food Operation Permit. 1 As a distributor of medical products, based on the advice of Allbright Law Offices, our PRC counsel, we do not believe that we or our subsidiaries are Critical Information Infrastructure Operators ("CIIO") or Online Platform Operators as defined in Cybersecurity Review Measures published by Cyberspace Administration of China, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, Ministry of State Security, Ministry of Finance, Ministry of Commerce, People s Bank of China, State Administration of Radio and Television, China Securities Regulatory Commission, State Secrecy Administration and State Cryptography Administration on December 28, 2021 and became effective on February 15, 2022. As of the date of this prospectus, we and our subsidiaries (1) are not required to obtain permissions from any PRC authorities to issue our securities being registered for sale to foreign investors other than the filing requirement with CSRC within three business days after we make any oversea securities offering under New Overseas Listing Rules, (2) are not subject to permission requirements from China Securities Regulatory Commission (the "CSRC"), Cyberspace Administration of China ("CAC") or any other authority that is required to approve of our business operations in China, and (3) have not received or were denied such permissions by any PRC authorities. Nevertheless, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointly issued the "Opinions on Severely Cracking Down on Illegal Securities Activities According to Law," or the Opinions, which were made available to the public on July 6, 2021. The Opinions emphasized the need to strengthen the administration over illegal securities activities, and the need to strengthen the supervision over overseas listings by Chinese companies. On February 17, 2023, the CSRC released the New Overseas Listing Rules with five interpretive guidelines, which took effect on December 31, 2022. The New Overseas Listing Rules require Chinese domestic enterprises to complete filings with relevant governmental authorities and report related information under certain circumstances, such as: a) an issuer making an application for initial public offering and listing in an overseas market; b) an issuer making an overseas securities offering after having been listed on an overseas market; c) a domestic company seeking an overseas direct or indirect listing of its assets through single or multiple acquisition(s), share swap, transfer of shares or other means. Pursuant to the New Overseas Listing Rules, domestic companies that seek initial public offering or listing securities overseas, both directly and indirectly, shall file with the CSRC within three working days after the submission of overseas offering/listing application. Furthermore, upon the occurrence of any of the material events specified below after an issuer has completed its offering and listed its securities on an overseas stock exchange, the issuer shall submit a report thereof to the CSRC within three working days after the occurrence and public disclosure of the event: (i) change of control; (ii) investigations or sanctions imposed by overseas securities regulatory agencies or other competent authorities; (iii) change of listing status or transfer of listing segment; or (iv) voluntary or mandatory delisting. The New Overseas Listing Rules stipulate the legal consequences to the companies for breaches, including failure to fulfil filing obligations or filing documents having false statement or misleading information or material omissions, which may result in a fine ranging from RMB 1 million to RMB 10 million, and in cases of severe violations, the relevant responsible persons may also be barred from entering the securities market. We are subject to the relevant filing procedures of the CSRC in connection with our overseas offerings under the New Overseas Listing Rules, including the public offering pursuant to this registration statement. We have filed this offering with CSRC on December 30, 2024 and is waiting for the feedback from the CSRC. On February 24, 2023, the CSRC, the Ministry of Finance, the National Administration of State Secretes Protection and the National Archives Administration released the Provisions on Strengthening the Confidentiality and Archives Administration Related to the Overseas Securities Offering and Listing by Domestic Companies, or the Confidentiality and Archives Administration Provisions, which took effect on December 31, 2022. PRC domestic enterprises seeking to offer securities and list in overseas markets, either directly or indirectly, shall establish and improve the system of confidentiality and archives work, and shall complete approval and filing procedures with competent authorities, if such PRC domestic enterprises or their overseas listing entities provide or publicly disclose documents or materials involving state secrets and work secrets of state organs to relevant securities companies, securities service institutions, overseas regulatory agencies and other entities and individuals. It further stipulates that (i) providing or publicly disclosing documents and materials which may adversely affect national security or public interests, and accounting records or photocopies thereof to relevant securities companies, securities service institutions, overseas regulatory agencies and other entities and individuals shall be subject to corresponding procedures in accordance with relevant laws and regulations; and (ii) any working papers formed in the territory of the PRC by securities companies and securities service agencies that provide domestic enterprises with securities services relating to overseas securities issuance and listing shall be stored in the territory of the PRC, the outbound transfer of which shall be subject to corresponding procedures in accordance with relevant laws and regulations. Our operating subsidiaries distribute and sell medical products in China and they are not cyberspace operators with personal information of more than 1 million users or activities that affect or may affect national security and they don t have documents and materials which may adversely affect national security or public interests. However, given the current PRC regulatory environment, it is uncertain whether we or our PRC subsidiaries, will be able to obtain such permission or be required to obtain other permission from the PRC government to list on U.S. exchanges or offer their securities overseas, and even when such permission is obtained, whether it will be denied or rescinded. If we or our subsidiaries do not receive or maintain such permissions or approvals, inadvertently conclude that such permissions or approvals are not required, or applicable laws, regulations, or interpretations change and we are required to obtain such permissions or approvals in the future, it could significantly limit or completely hinder our ability to offer or continue to offer our securities to investors, cause the value of our securities to significantly decline or become worthless and could result in a material and negative impact on our business operations, including fines or penalties imposed by the relevant PRC regulatory authority, revocation of our subsidiaries business licenses and suspension of their respective business operations. 2 Our independent registered public accounting firm that issues the audit report included elsewhere in this prospectus, as an auditor of companies that are traded publicly in the United States and a firm registered with the PCAOB, is subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess its compliance with the applicable professional standards. Our auditor is headquartered in the U.S and is not subject to the determinations announced by the PCAOB on December 16, 2021, which determinations were vacated on December 15, 2022. The Holding Foreign Companies Accountable Act and related regulations currently does not affect the Company as the Company s auditor is subject to PCAOB s inspection and investigation. However, should PRC authorities obstruct or otherwise fail to facilitate the PCAOB s access in the future, the PCAOB Board will consider the need to issue a new determination, and we cannot assure you whether Nasdaq or regulatory authorities would apply additional and more stringent criteria to us after considering the effectiveness of our auditor s audit procedures and quality control procedures, adequacy of personnel and training, or sufficiency of resources, geographic reach, or experience as it relates to our audit. If it is later determined that the PCAOB is unable to inspect or investigate completely our auditor because of a position taken by an authority in a foreign jurisdiction or any other reasons, the lack of inspection could cause the trading in our securities to be prohibited under the Holding Foreign Companies Accountable Act, and as a result Nasdaq may delist our securities. If our securities are unable to be listed on another securities exchange, such a delisting would substantially impair your ability to sell or purchase our securities when you wish to do so, and the risk and uncertainty associated with a potential delisting would have a negative impact on the price of our Ordinary Shares. Further, new laws and regulations or changes in laws and regulations in both the United States and China could affect our ability to list our Ordinary Shares on Nasdaq, which could materially impair the market for and market price for our securities. Dividend Distribution and Cash Transfer Between the Holding Company and Subsidiaries Our PRC operating entities receive all of their revenue in RMB. Under our current corporate structure, to fund any cash and financing requirements, we may rely on dividend payments from Hainan HengRong Health Industrial Co. Ltd. or WFOE. WFOE receives dividend payments and other direct income from our other operating subsidiaries. WFOE may make distribution of such payments to China HengHong Group Limited as dividends. Under the existing PRC foreign exchange regulations, payments of current account items, such as profit distributions and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior approval from SAFE by complying with certain procedural requirements. Therefore, WFOE is able to pay dividends in foreign currencies to us without prior approval from SAFE, subject to the condition that the remittance of such dividends outside of the PRC complies with certain procedures under PRC foreign exchange regulations, such as the overseas investment registrations by our shareholders who are PRC residents. Approval from or registration with appropriate government authorities is, however, required where the RMB is to be converted into foreign currency and remitted out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies. The PRC government may also at its discretion restrict access in the future to foreign currencies for current account transactions. For our Hong Kong subsidiary and the holding company ("Non-PRC Entities"), there is no restrictions on foreign exchange for such entities and they are able to transfer cash among these entities, across borders and to US investors. Also, there are no regulatory restrictions and limitations on the abilities of Non-PRC Entities to distribute earnings from their businesses, including from subsidiaries to the parent company or from the holding company to the U.S. investors. However, to the extent cash/assets in the business are in PRC/Hong Kong or our PRC/Hong Kong entities, the funds/assets may not be available to fund operations or for other use outside of PRC/Hong Kong due to interventions in or the imposition of restrictions and limitations on the ability of us or our subsidiaries by the PRC government to transfer cash/assets. As of the date of this prospectus, we do not have cash management policies and procedures in place that dictate how funds are transferred through our organization. Rather, the funds can be transferred in accordance with the applicable PRC laws and regulations. See "Selected Condensed Consolidated Financial Schedule of the Company and Its Subsidiaries" beginning on page 8 of this prospectus and "Selected Consolidated Financial Statements" on page F-1 of this prospectus. Current PRC regulations permit our PRC subsidiaries to pay dividends to the Company only out of their accumulated profits, if any, determined in accordance with Chinese accounting standards and regulations. In addition, our subsidiaries in China are required to set aside at least 10% of their after-tax profits each year, if any, to fund a statutory reserve until such reserve reaches 50% of its registered capital. Each such entity in China is a required to further set aside a portion of its after-tax profits to fund the employee welfare fund, although the amount to be set aside, if any, is determined at the discretion of its board of directors. Although the statutory reserves can be used, among other ways, to increase the registered capital and eliminate future losses in excess of retained earnings of the respective companies, the reserve funds are not distributable as cash dividends except in the event of liquidation. Under the existing laws of Hong Kong, funds from capital accounts can be repatriated and remitted overseas without restrictions, and there is no foreign exchange control imposed. According to the current tax practice of the Hong Kong Inland Revenue Department, dividends paid on the Ordinary Shares would not be subject to any Hong Kong tax. During the years ended December 31, 2023 and 2024, HengCheng approved and declared a dividend to GDHC, the former 100% shareholder of HengCheng prior the Reorganization, for profits earned by HengCheng before the Reorganization. For the year ended December 31, 2023, HengCheng distributed dividends to GDHC of RMB 26,400,000. For the year ended December 31, 2024, HengCheng distributed dividends to GDHC of RMB 28,997,087 (US$ 3,972,585). On May 15, 2025, HengCheng declared and distributed dividend at RMB 3,499,404 (US$479,416) to GDHC according to the share purchased agreement signed between HengXiong and GDHC on June 6, 2024. As of the date of this prospectus, WFOE has not made any dividends or distributions to HengHong HK, HengHong HK has not made any dividends or distribution to the holding company, and no dividends or distributions have been made by the Company to its shareholders. We intend to keep any future earnings to re-invest in and finance the expansion of our business, and we do not anticipate that any cash dividends will be paid in the foreseeable future. Under the Cayman Islands law, a Cayman Islands company may pay a dividend on its shares out of either profit or share premium amount, provided that in no circumstances may a dividend be paid if this would result in the company being unable to pay its debts due in the ordinary course of business. 3 Cash dividends, if any, on our Ordinary Shares will be paid in U.S. dollars. If we are considered a PRC tax resident enterprise for tax purposes, any dividends we pay to our overseas shareholders may be regarded as China-sourced income and as a result may be subject to PRC withholding tax at a rate of up to 10.0%. Pursuant to the Arrangement between the Mainland of China and the Hong Kong Special Administrative Region for the Avoidance of Double Taxation and the Prevention of Fiscal Tax Evasion With Respect to Taxes On Income, or the Double Tax Avoidance Arrangement, the 10% withholding tax rate may be lowered to 5%, if the recipient of the relevant dividends meets certain necessary requirements, including without limitation that (a) the Hong Kong company must be the beneficial owner of the relevant dividends; and (b) the Hong Kong company must directly hold no less than 25% share ownership in the PRC company during the 12 consecutive months preceding its receipt of the dividends. The 5% withholding tax rate, however, does not automatically apply and in current practice, a Hong Kong company must obtain a tax resident certificate from the Hong Kong tax authority to apply for the 5% lower PRC withholding tax rate. As the Hong Kong tax authority will issue such a tax resident certificate on a case-by-case basis, we cannot assure you that we will be able to obtain the tax resident certificate from the relevant Hong Kong tax authority and enjoy the preferential withholding tax rate of 5% under the Double Taxation Arrangement with respect to any dividends paid by WFOE to its immediate holding company, HengHong HK. As of the date of this prospectus, we have not applied for the tax resident certificate from the relevant Hong Kong tax authority. HengHong HK intends to apply for the tax resident certificate if and when WFOE plans to declare and pay dividends to HengHong HK. Competition We compete with other Chinese pharmaceutical companies, which sell products similar to ours. Many of them are more seasoned companies than us and have much more capital, technology, and other resources than we currently have. Some of our competitors may be able to respond more quickly to new opportunities, market changes or changes in customer preferences, may be able to carry out more extensive promotion activities than we do, provide more attractive commercial conditions to distributors, and adopt more active pricing strategies. Nevertheless, we believe that with our well-developed sales and marketing network and experienced and outstanding team, we are fully capable of occupying a place in the market competition. Our Competitive Strengths We believe the following strengths differentiate us from our competitors and are key drivers of our success: 1. Experienced and stable marketing team Our marketing team has rich experience and stable personnel. More than 80% of our marketing staff have more than 10 years of experience in medicine sales with rich and practical experience in marketing strategy, market development, medicine promotion, etc., and are good at channel construction management and end customer expansion and maintenance. 2. Efficient channel construction and broad terminal coverage We have built a multi-channel sales system, including distribution of our products offline and to online pharmacies and their platforms, among which the offline distribution and marketing generate the majority of our revenue at the present stage. At the same time, we have actively responded to the transformation of marketing channels that increasingly favor online distribution, carrying out more online marketing activities, and improving the online sales and revenues. 3. Strong product marketing ability To achieve the goal of final sales, our marketing team focuses on hospitals, retail pharmacies and community clinics, carries out multi-dimensional marketing activities, and assists distributors in their product sales. Through refined management and operation of distribution and retail channels, accurate insight into market dynamics, rapid response to market information, timely provision of products that meet market demand, flexible and effective marketing policies, we have achieved efficient marketing and sales of high-quality medicines to end users. 4. Efficient operational management We adopted a light-asset operation model. Our manpower and capital are mainly invested in product selection, distributor screening, channel construction and market promotion. We have reduced the capital cost of holding inventory by sales and purchase management, and have strictly managed our credit period of accounts receivable. 4 Our Challenges Our competitors include well-known enterprises in the medicine distribution industry, such as Jointown Pharmaceutical Group Co., Ltd, China National Accord Medicines Corporation Ltd, Qingdao Baheal Medical Inc., and well-known traditional Chinese medicine manufacturers in China that have their own distribution channels in China, including China Beijing Tongrentang Group Co., Ltd., Yunnan Baiyao Group, China Resources Sanjiu Medical & Pharmaceutical Co., Ltd and Guangzhou Baiyunshan Pharmaceutical Holdings Co., Ltd. Our Growth Strategies In order to enhance our competitive position and expand our market, we intend to pursue the following strategies and leverage our strengths to further grow our business: 1. New product strategy Focusing on the overall layout of "prevention - treatment - rehabilitation", through patent cooperation and mergers and acquisitions, we will select high-quality new products that are still under the protection of intellectual property rights owned by the manufacturers, suppliers or entities owning exclusive distribution rights to such products, use our own resources and capabilities to market and build our own brand marketing system, and improve our profitability. 2. International strategy for traditional Chinese medicines We will focus on traditional Chinese medicines for common diseases, frequently occurring diseases and chronic diseases, give play to the unique advantages of traditional Chinese medicine in prevention, health care, disease treatment and rehabilitation. We will first select certain traditional Chinese medicine related healthy food standard products and cooperate with multinational pharmaceutical companies that we have existing relationship to distribute traditional Chinese medicine to Europe and around the world, to increase our sales. We will also introduce foreign high-quality and innovative medicines through various modes such as exclusive distribution license, patent licensing or joint venture, to promote an introduce overseas high-quality products. 3. Digital intelligence strategy We plan to further improve our digital marketing to achieve broad coverage and accurate access to the end users market, and to continue to improve operation decision-making ability based on big data analysis and the optimal allocation of our marketing resources. We plan to build an internal management system to cover all our business management areas, further use IT technology to carry out intelligent applications, reduce costs and increase efficiency, and to improve our operation and management capabilities. Corporate History and Structure HengHong Technology Inc. is a holding company incorporated in the Cayman Islands on March 21, 2024. HengHong Technology Inc. established its directly wholly-owned subsidiary, China HengHong Group Limited in Hong Kong on April 22, 2024. China HengHong Group Limited established its directly wholly-owned subsidiary Hainan HengRong Health Industrial Co., Ltd. in China on July 2, 2024. Hainan Hengxiong Health Technology Co., Ltd. was incorporated on February 6, 2024, and became a wholly-owned subsidiary of Hainan HengRong Health Industrial Co., Ltd. on September 30, 2024. Hainan Hengcheng Health Industrial Co., Ltd. was incorporated on December 31, 2008, and became a wholly-owned subsidiary of Hainan Hengxiong Health Technology Co., Ltd. on September 30, 2024. Hainan Hengcheng Health Industrial Co., Ltd. is the principal operating company for the Company in China. Hainan HengRong Health Industrial Co. Ltd, and Hainan HengXiong Technology Inc. are both holding companies and have no material operations. In anticipation of this offering, we completed a reorganization of the Company on September 30, 2024 (the "Reorganization"). The Ordinary Shares offered in this offering are shares of the Cayman Islands holding company. As a holding company with no material operations of its own, the Company conducts all its operations through its operating subsidiary HengCheng (the "Operating Subsidiary") in China. Since HengHong Technology and its subsidiaries are effectively controlled by the same controlling shareholders before and after the Reorganization, they are considered under common control. The above-mentioned transactions were accounted for as a recapitalization. The consolidation of the Company and its subsidiaries has been accounted for at historical cost and prepared on the basis as if the aforementioned transactions had become effective as of the beginning of the first period presented in the accompanying consolidated financial statements. 5 Upon the completion of the Reorganization in September 2024, the Company had subsidiaries in countries and jurisdictions including the PRC and Hong Kong. Details of the subsidiaries of the Company are set out below: Name of Entity Date of Incorporation Place of Incorporation % of Ownership Principal Activities HengHong HK 4/22/2024 Hong Kong 100 Holding Company HengRong 7/2/2024 China 100 Holding Company HengXiong 2/6/2024 China 100 Holding Company HengCheng 12/31/2008 China 100 Distribute and sell medical products and provide promotion and marketing services The following diagram illustrates our corporate structure, including our subsidiaries and consolidated affiliated entities, as of the date of this prospectus and immediately upon the completion of this offering, assuming no exercise of the over-allotment option by the Underwriter: *The investors are purchasing the securities of HengHong Technology Inc., the holding company incorporated in Cayman Islands; and our operations are conducted by our indirectly wholly owned subsidiary Hainan HengCheng Health Industrial Co., Ltd. 6 As a result of our corporate structure, HengHong Technology s ability to pay dividends will depend upon dividends paid by our subsidiaries. If our existing subsidiaries or any newly formed ones incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us. Implications of Being a "Foreign Private Issuer" We are a foreign private issuer within the meaning of the rules under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). As such, we are exempt from certain provisions applicable to United States domestic public companies. For example: we are not required to provide as many Exchange Act reports, or as frequently, as a domestic public company; for interim reporting, we are permitted to comply solely with our home country requirements, which are less rigorous than the rules that apply to domestic public companies; we are not required to provide the same level of disclosure on certain issues, such as executive compensation; we are exempt from provisions of Regulation FD aimed at preventing issuers from making selective disclosures of material information; we are not required to comply with the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; and our insiders are not required to comply with Section 16 of the Exchange Act requiring such individuals and entities to file public reports of their share ownership and trading activities and establishing insider liability for profits realized from any "short-swing" trading transaction. Implications of Being an "Emerging Growth Company" We are an "emerging growth company," as defined in the Jumpstart Our Business Startups Act (the "JOBS Act"), and we are eligible to take advantage of certain exemptions from various reporting and financial disclosure requirements that are applicable to other public companies that are not emerging growth companies, including but not limited to (1) presenting only two years of audited financial statements and only two years of related management s discussion and analysis of financial condition and results of operations in this prospectus, (2) not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act"), (3) reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and (4) exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We intend to take advantage of these exemptions. As a result, investors may find investing in our Ordinary Shares less attractive. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the "Securities Act"), for complying with new or revised accounting standards. As a result, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of such extended transition period. We could remain an emerging growth company for up to five years, or until the earliest of (1) the last day of the first fiscal year in which our annual gross revenues exceed $1.235 billion, (2) the date that we become a "large accelerated filer" as defined in Rule 12b-2 under the Exchange Act, which would occur if the market value of our Ordinary Shares that is held by non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter and we have been publicly reporting for at least 12 months, or (3) the date on which we have issued more than $1 billion in non-convertible debt during the preceding three-year period. Implications of Being a "Controlled Company" Under the Nasdaq rules, a "controlled company" is a company with more than 50% of its voting power held by a single person, entity or group. Public Companies that qualify as a "Controlled Company" with securities listed on the Nasdaq Stock Market (Nasdaq), must comply with the exchange s continued listing standards to maintain their listings. Nasdaq has adopted qualitative listing standards. Companies that do not comply with these corporate governance requirements may lose their listing status. Under Nasdaq rules, a controlled company is exempt from certain corporate governance requirements including: the requirement that a majority of the board of directors consist of independent directors; the requirement that a listed company have a nominating and governance committee that is composed entirely of independent directors with a written charter addressing the committee s purpose and responsibilities; the requirement that a listed company have a compensation committee that is composed entirely of independent directors with a written charter addressing the committee s purpose and responsibilities; and the requirement for an annual performance evaluation of the nominating and governance committee and compensation committee. 7 Controlled companies must still comply with the exchange s other corporate governance standards. These include having an audit committee and the special meetings of independent or non-management directors. Upon the completion of this offering, we will be a "controlled company" as defined under Nasdaq Stock Market Rules because HengHong Holdings Limited, a BVI company that is wholly owned by Mr. Weixiong Tan, the Chairman of our board of directors will own 74.6% of our total outstanding Ordinary Shares assuming the Underwriter does not exercise its over-allotment option, or 72.7% of our total outstanding Ordinary Shares if the Underwriter exercises its over-allotment option in full, pursuant to which he will be able to control all matters requiring shareholder approval. As a result, upon completion of this offering, we will be a "controlled company" as defined under the Nasdaq Stock Market Rules. As a "controlled company," we will be permitted to elect not to comply with certain corporate governance requirements. See "Risk Factors—Risks related to our Ordinary Shares and this offering—We will be a "controlled company" as defined under the Nasdaq Stock Market Rules. As a result, we may rely on exemptions from certain corporate governance requirements and holders of our Ordinary Shares may not have the same protections generally available to shareholders of other companies listed on stock exchanges in the United States." Selected Condensed Consolidated Financial Schedule of the Company and Its Subsidiaries For the year ended December 31, 2023 2024 RMB RMB US$ Net revenues: Sales of pharmaceutical goods 251,396,457 188,598,748 25,837,923 Promotion and marketing services - related party 12,721,206 11,760,295 1,611,154 Total revenues 264,117,663 200,359,043 27,449,077 Cost of revenues - related party (197,817,568 ) (147,185,237 ) (20,164,295 ) Cost of revenues - third parties (4,993,544 ) (8,576,031 ) (1,174,911 ) Total cost of revenues (202,811,112 ) (155,761,268 ) (21,339,206 ) Gross profit 61,306,551 44,597,775 6,109,871 Operating expenses: Selling and marketing expenses (32,535,846 ) (28,065,024 ) (3,844,893 ) General and administrative expenses (1,522,206 ) (2,416,463 ) (331,054 ) Total operating expenses (34,058,052 ) (30,481,487 ) (4,175,947 ) Income from operation 27,248,499 14,116,288 1,933,924 Other income (expenses): Interest income 7,537 10,686 1,464 Interest expenses (985,478 ) (1,254,026 ) (171,801 ) Government subsidies 110,000 5,020,045 687,743 Other income, net 1,034 60,859 8,338 Total other (expenses) income, net (866,907 ) 3,837,564 525,744 Income before income tax expense 26,381,592 17,953,852 2,459,668 Income tax expenses (3,994,021 ) (2,713,496 ) (371,747 ) Net income 22,387,571 15,240,356 2,087,921 Total comprehensive income 22,387,571 15,240,356 2,087,921 Earnings per ordinary share* Basic and diluted 2.24 1.52 0.21 Weighted average number of ordinary shares outstanding* Basic and diluted 10,000,000 10,000,000 10,000,000 Corporate Information Our principal executive offices are located at 3rd Floor, A-24 Building, Hainan Eco-Software Park, Old town development Zone, Chengmai County, Hainan Province, China 571900. Our telephone number at this address is +86-898-67488011. Our registered office in the Cayman Islands is located at 4th Floor, Harbour Place, 103 South Church Street, P.O. Box 10240, Grand Cayman KY1-1002, Cayman Islands. Our agent for service of process in the United States is Cogency Global Inc. located at 122 East 42nd Street, 18th Floor, New York, NY 10168. Investors should contact us for any inquiries through the address and telephone number of our principal executive offices. Our website is www.[ ].com. The information contained on our website is not a part of this prospectus. 8 Summary
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+Prospectus Summary Founder shares conversion and anti-dilution rights. If we raise additional funds through equity or convertible debt issuances, our public shareholders may suffer significant dilution. This dilution would increase to the extent that the anti-dilution provision of the founder shares results in the issuance of Class A ordinary shares on a greater than one-for-one basis upon conversion of the founder shares at the time of our initial business combination. 7 Table of Contents Pursuant to a letter agreement to be entered into with us, each of our sponsor, directors and officers has agreed to restrictions on its ability to transfer, assign, or sell the founder shares and private placement units, as summarized in the table below. Subject Securities Expiration Date Natural Persons and Entities Subject to Restrictions Exceptions to Transfer Restrictions Founder shares The earlier of (A) one year after the completion of our initial business combination or earlier if, subsequent to our initial business combination, the closing price of the Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination and (B) the date following the completion of our initial business combination on which we complete a liquidation, merger, share exchange or other similar transaction that results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property. Twelve Seas Sponsor LLC Dimitri Elkin Jonathan Morris Julian Vickers Bob Foresman Olga Klimova Greg Nelson Transfers permitted (a) to our officers, directors, advisors or consultants, any affiliate or family member of any of our officers, directors, advisors or consultants, any members or partners of the sponsor or their affiliates and funds and accounts advised by such members or partners, any affiliates of the sponsor, or any employees of such affiliates; (b) in the case of an individual, as a gift to such person s immediate family or to a trust, the beneficiary of which is a member of such person s immediate family, an affiliate of such person or to a charitable organization; (c) in the case of an individual, by virtue of laws of descent and distribution upon death of such person; (d) in the case of an individual, pursuant to a qualified domestic relations order; (e) by private sales or transfers made in connection with any forward purchase agreement or similar arrangement, in connection with an extension of the completion window or in connection with the consummation of a business combination at prices no greater than the price at which the shares or Share Rights were originally purchased; (f) pro rata distributions from our sponsor to its respective members, partners or shareholders pursuant to our sponsor s limited liability company agreement or other charter documents; (g) by virtue of the laws of the Cayman Islands or our sponsor s limited liability company agreement upon dissolution of our sponsor; (h) in the event of our liquidation prior to our consummation of our initial business combination; (i) in the event that, subsequent to our consummation of an initial business combination, we complete a liquidation, merger, share exchange or other similar transaction which results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, 8 Table of Contents Subject Securities Expiration Date Natural Persons and Entities Subject to Restrictions Exceptions to Transfer Restrictions securities or other property; or (j) to a nominee or custodian of a person or entity to whom a transfer would be permissible under clauses (a) through (g); provided, however, that in the case of clauses (a) through (g) and clause (j) these permitted transferees must enter into a written agreement agreeing to be bound by these transfer restrictions and the other restrictions contained in the letter agreement. Private placement units (including underlying securities) 30 days after the completion of our initial business combination Twelve Seas Sponsor LLC Dimitri Elkin Jonathan Morris Julian Vickers Bob Foresman Olga Klimova Greg Nelson Same as above, except CCM shall also be permitted to make the same type of transfers to their affiliates as the sponsor can make to its affiliates as described above. Any units, Share Rights, ordinary shares or any other securities convertible into, or exercisable or exchangeable for, any units, ordinary shares, founder shares or rights 180 days from the date of this prospectus Twelve Seas Sponsor LLC Dimitri Elkin Jonathan Morris Julian Vickers Bob Foresman Olga Klimova Greg Nelson We, our sponsor and our officers and directors have agreed that, for a period of 180 days from the date of this prospectus, we and they will not, without the prior written consent of the representative of the underwriters, offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, any units, Share Rights, shares or any other securities convertible into, or exercisable, or exchangeable for, shares, subject to certain exceptions. The representative in its sole discretion may release any of the securities subject to these lock-up agreements at any time without notice, other than in the case of the officers and directors, which shall be with notice. Our sponsor, officers and directors are also subject to separate transfer restrictions on their founder shares and private placement units pursuant to the letter agreement described in the immediately preceding paragraphs. 9 Table of Contents Up to 742,500 of the founder shares will be surrendered for no consideration depending on the extent to which the underwriters over-allotment option is exercised. In addition, in order to facilitate our initial business combination as determined by our sponsor in its sole discretion, our sponsor may surrender or forfeit, transfer or exchange our founder shares, private placement units or any of our other securities, including for no consideration, as well as subject any such securities to earn-outs or other restrictions, or otherwise amend the terms of any such securities or enter into any other arrangements with respect to any such securities. We may also issue Class A ordinary shares upon conversion of the Class B ordinary shares at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions as set forth therein. Pursuant to the letter agreement to be entered with us, each of our sponsor, directors and officers have agreed to a lock-up and restrictions on their ability to transfer, assign, or sell the founder shares and private placement units and securities underlying the private placement units. Further, the sponsor membership interests are locked up and not transferable because the letter agreement prohibits indirect transfers. Non-managing sponsor investors will not be subject to transfer restrictions or a lock-up agreement on any public Class A ordinary shares that they may purchase in this offering (if any). In addition, if they make such purchases, non-managing sponsor investors may potentially have different interests than other public shareholders in approving our initial business combination, due to their membership interests in the sponsor. Our letter agreement may be amended without shareholder approval. Such transfer restrictions have been amended in connection with business combinations for certain other special purpose acquisition companies. While we do not expect our board to approve any amendment to the letter agreement prior to our initial business combination, it may be possible that our board, in exercising its business judgment and subject to its fiduciary duties, chooses to approve one or more amendments to the letter agreement. Our Business Strategy Non-U.S. Geographic Opportunity While we may acquire a business in any industry and in any geographic location, our focus will be on international companies located, including in the Pan-Eurasian region and Africa. We will also consider prospective targets located in the United States, but which are potentially owned by sovereign wealth funds, family offices or industrial conglomerates headquartered in the Pan-Eurasian region. We believe that specializing in international opportunities will provide us with a competitive advantage over other U.S.-listed SPACs and will enable us to identify an attractive business combination candidate that will thrive as a publicly traded company. For many international companies, we believe there are a number of advantages that come with a public listing in the United States. U.S. equity markets provide access to the most robust and liquid capital markets and a broad, high quality investor base including top tier institutional and retail investors. International companies can also benefit through strong corporate governance as well as the globally recognized prestige of a U.S. public listing. International companies with exposure to the U.S. or plans to expand into the U.S. can benefit from a U.S. public listing in order to gain visibility and credibility with their American customers and partners. According to E&Y, since 2023, approximately 52% of IPOs on U.S. exchanges have been from foreign-domiciled issuers, a 20-year high. SPACs also continue to be an attractive and viable alternative for a foreign-domiciled company to attain a U.S. listing. Of the one hundred most recently completed SPAC mergers as of December 31, 2024, over 40% involved foreign targets. Over the past five years non-U.S. targets have become an important component of the U.S. SPAC market. We believe a SPAC merger can offer more advantages than the traditional IPO process for companies domiciled outside the United States. Such advantages include more certainty over valuation and timing of listing, structural flexibility to providing earnouts, different classes of stock and other incentives to the selling shareholder, and the ability to structure a transaction that includes a merger of two or more companies. Going forward, we believe that international targets will continue be an attractive source of potential SPAC targets. We believe that that our management team is well positioned to assess such risks and to organize a successful merger with a non-U.S. target given its prior experience managing the challenges and risks of listing a foreign company in the U.S. markets. 10 Table of Contents In fact, the focus on international companies has been our strategy since the listing of certain of our management team s first SPAC, Twelve Seas I, in 2018. At the time, the SPAC structure was relatively unknown outside of the U.S., and the number of SPACs merging with non-U.S. companies was relatively small with less than 20% of SPAC mergers closing with a non-US target in 2018. Such non-U.S. focus was a novel idea that had to be tested, and we believe it was successfully validated by Twelve Seas I s merger with an UAE based company. We believe that the non-U.S. opportunity for a U.S.-listed SPAC such as ours will continue to broaden as SPACs gain even greater acceptance by potential targets and investors alike. We intend to pursue a strategy of looking for companies outside of the United States. We believe that our Pan-Eurasian strategy as well as our extensive experience with international markets will differentiate our team. Competitive Differentiation Our mission is to create attractive risk-adjusted returns for our shareholders. We intend to capitalize on the ability of our management team to identify, acquire and operate a business that will benefit from their involvement by utilizing the differentiating factors discussed below to our advantage. We believe that specializing in non-U.S. opportunities will provide us with a competitive advantage over other U.S.-listed SPACs and will enable us to identify an attractive business combination candidate that will thrive as a publicly traded company. We intend to focus our initial search efforts on the Pan-Eurasian region that includes developed economies of Western Europe, developing markets of Eastern Europe and Asia and frontier markets of the Middle East. We may also consider targets in Africa. Our management team has experience with cross-border investments in many of the countries across the target regions, including the United Kingdom, Germany, Italy, Turkey, Kazakhstan, the United Arab Emirates, and others. Because we have limited experience in China, we will not pursue opportunities related to China. However, we intend to also explore opportunities in the Southeast Asia, including Vietnam, Indonesia and Thailand. While we believe our global focus will enable us to identify many unique opportunities, non-U.S. geographies present a number of unique challenges. In addition to all the common issues involved in assessing the attractiveness of an investment opportunity for a SPAC and executing a business combination, we will face additional cross-border obstacles and risks, including: Diverse and fluid legal and regulatory regimes Currency risk and capital controls restrictions Cultural and linguistic barriers Political risks and restrictions on foreign investments Inconsistent law enforcement and weaker legal protection of investor rights Impact of geopolitical tensions, including various sanctions implemented by U.S. and European Union Our management team has been involved in investing in the Pan-Eurasian region since the early 1990s, and possesses a rich base of experience including: Identifying, negotiating and executing cross-border transactions in a variety of sectors, including consumer, energy, industrial, transportation and infrastructure; Cultivating relationships with local industrial and financial groups; Organizing complex debt and equity financings for target companies; Executing follow-on acquisitions and divestitures; Overseeing portfolio companies and helping improve corporate governance and transparency; Serving as directors and executives of portfolio companies; 11 Table of Contents Attracting what we believe is world-class management talent; Partnering, where necessary, with corporate co-investors, including multinationals; Steering companies towards an exit, either via strategic sale or via an IPO; We believe our collective experience equips us to identify and evaluate attractive foreign candidates for an initial business combination. We will focus on identifying targets that can appeal to fundamental equity investors in the United States. If necessary, we would be available to work with the company to create shareholder value after the business combination is concluded. We further believe the collective experience of our management team and their affiliates will lead to many potential acquisition opportunities. Upon completion of this offering, members of our management team and their affiliates will reach out to the network of relationships to articulate the parameters of our search for a target company and will begin the rigorous process of pursuing and reviewing promising opportunities. Business Combination Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet some or all of these criteria and guidelines. We intend to seek to acquire one or more businesses that we believe: have an equity value of between $200 million and $2 billion; have a compelling business reason to be listed in the United States. We will seek to acquire targets that can become a global player in their business segment, and which can benefit from the access to the deep U.S. capital markets; desire to benefit from the speed and the certainty of closure, and sellers who would be attracted to the possibility to receiving further consideration in the form of a share earnout available in a SPAC merger; offer attractive risk-adjusted equity returns for our shareholders, and that can demonstrate a clear plan for shareholder value creation, including revenue growth, cost reduction and margin expansion, add-on acquisitions, or other prospects for upside; have a strong set of public comparables; possess a robust accounting and financial reporting processes and have the proper internal controls and procedures in place to company with U.S. public company listing standards; are at a financial performance inflection point and have a clear potential of delivering strong earnings and cashflow growth in the short to medium term. We will give special consideration to companies that are capable of paying an attractive dividend immediately after the closing of an initial business combination; are led by management teams who, because of their prior achievements and current performance and the ability to articulate a compelling future vision, can develop a following among U.S. fundamental investors. We will not limit our search to any particular sector, but we will prioritize industries with established business models and proven profitability, with a particular emphasis on natural resources and related sectors which we believe aligns well with investors renewed interest in the traditional sources of energy. These criteria and guidelines are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general criteria and guidelines as well as other considerations, factors, criteria and guidelines that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria and guidelines in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC. 12 Table of Contents Potential Additional Financings We may need to obtain additional financing to complete our initial business combination, either because the transaction requires more cash than is available from the proceeds held in our trust account or because we become obligated to redeem a significant number of our public shares upon completion of the business combination, in which case we may issue additional securities or incur debt in connection with such business combination. If we raise additional funds through equity or convertible debt issuances, our public shareholders may suffer significant dilution and these securities could have rights that rank senior to our public shares. If we raise additional funds through the incurrence of indebtedness, such indebtedness would have rights that are senior to our equity securities and could contain covenants that restrict our operations. Further, as described above, due to the anti-dilution rights of our founder shares, our public shareholders may incur material dilution. In addition, we intend to target businesses with enterprise values that are greater than we could acquire with the net proceeds of this offering and the sale of the private placement units, and, as a result, if the cash portion of the purchase price exceeds the amount available from the trust account, net of amounts needed to satisfy any redemptions by public shareholders, we may be required to seek additional financing to complete such proposed initial business combination. We may also obtain financing prior to the closing of our initial business combination to fund our working capital needs and transaction costs in connection with our search for and completion of our initial business combination. There is no limitation on our ability to raise funds through the issuance of equity or equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements or backstop agreements we may enter into following consummation of this offering. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our initial business combination. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to liquidate the trust account. In addition, following our initial business combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations. See Proposed Business Potential Additional Financing. Our Business Combination Process In evaluating a prospective target business, we expect to conduct an extensive due diligence review which may encompass, as applicable and among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities and a review of financial and other information about the target and its industry. We will also utilize our management team s operational and capital planning experience. Each of our directors and officers will, directly or indirectly, own founder shares and/or private placement units following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, such officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Certain of our officers and directors presently have, and any of them in the future may have additional, fiduciary or contractual obligations to other entities, pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity subject to his or her fiduciary duties. As a result, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, then, subject to such officer s and director s fiduciary duties under Cayman Islands law, he or she will need to honor such fiduciary or contractual obligations to present such business combination opportunity to such entity, before we can pursue such opportunity. If these other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. However, we do not expect these duties to materially affect our ability to complete our initial business combination. Our amended and restated memorandum and articles of association will provide that to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and us, on the other. 13 Table of Contents Initial Business Combination We are not presently engaged in, and we will not engage in, any operations for an indefinite period of time following this offering. We intend to effectuate our initial business combination using cash from the proceeds of this offering and the private placement of the private placement units, the proceeds of the sale of our shares in connection with our initial business combination (including pursuant to forward purchase agreements or backstop agreements we may enter into following the consummation of this offering or otherwise), shares issued to the owners of the target, debt issued to bank or other lenders or the owners of the target, other securities issuances, or a combination of the foregoing. We may seek to complete our initial business combination with a company or business in its early stages of development or growth, which would subject us to the numerous risks inherent in such companies and businesses. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination either (i) in connection with a general meeting called to approve the business combination or (ii) without a shareholder vote by means of a tender offer. If we seek shareholder approval, we will complete our initial business combination only if we receive an ordinary resolution under Cayman Islands law and our amended and restated memorandum and articles of association, which requires the affirmative vote of at least a majority of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at the applicable general meeting of the company. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under applicable law or stock exchange listing requirement. We have until the date that is 24 months from the closing of this offering or until such earlier liquidation date as our board of directors may approve, to consummate our initial business combination. If we anticipate that we may be unable to consummate our initial business combination within such 24-month period, we may seek shareholder approval to amend our amended and restated memorandum and articles of association to extend the date by which we must consummate our initial business combination. If we seek shareholder approval for an extension, holders of public shares will be offered an opportunity to redeem their shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (less taxes, if any), divided by the number of then issued and outstanding public shares, subject to applicable law. If we are unable to complete our initial business combination within the completion window and do not hold a shareholder vote to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to consummate an initial business combination,, or by such earlier liquidation date as our board of directors may approve, from the closing of this offering, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (less taxes, if any, payable and up to $100,000 of interest income to pay dissolution expenses), divided by the number of then issued and outstanding public shares, subject to applicable law and certain conditions as further described herein. We expect the pro rata redemption price to be approximately $10.00 per public share (regardless of whether or not the underwriters exercise their over-allotment option), without taking into account any interest or other income earned on such funds. However, we cannot assure you that we will in fact be able to distribute such amounts as a result of claims of creditors, which may take priority over the claims of our public shareholders. If we do not complete our initial business combination within the completion window, while we do not currently intend to seek shareholder approval to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to consummate an initial business combination, we may elect to do so in the future. There is no limit on the number of extensions that we may seek; however, we do not expect to extend the time period to consummate our initial business combination beyond 36 months from the closing of this offering. If we determine not to or are unable to extend the time period to consummate our initial business combination or fail to obtain shareholder approval to extend the completion window, our sponsor s investment in our founder shares and our private placement units will be worthless. Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account). Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently 14 Table of Contents determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. While we consider it likely that our board of directors will be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of the target s assets or prospects. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test described above. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor (or its members), our officers or directors, or completing the business combination through a joint venture or other form of shared ownership with our sponsor (or its members), our officers or directors. In the event we seek to complete our initial business combination with a company that is affiliated (as defined in our amended and restated memorandum and articles of association) with our sponsor, its members, our officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions, stating that the consideration to be paid by us in such an initial business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other context. Members of our management team and our independent directors will directly or indirectly own founder shares and/or private placement units following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. The low price that our sponsor, executive officers and directors (directly or indirectly) paid for the founder shares creates an incentive whereby our officers and directors could potentially make a substantial profit even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. If we are unable to complete our initial business combination within the completion window, or by such earlier liquidation date as our board of directors may approve, the founder shares and the private placement units (and the securities comprising such units) may expire worthless, except to the extent they receive liquidating distributions from assets outside the trust account, which could create an incentive for our sponsor, executive officers and directors to complete a transaction even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has 15 Table of Contents then current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such other entity, subject to their fiduciary duties under Cayman Islands law. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by law: (i) no individual serving as a director or an officer, among other persons, shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us, and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which (a) may be a corporate opportunity for any director or officer, on the one hand, and us, on the other or (b) the presentation of which would breach an existing legal obligation of a director or officer to any other entity. As a result, the fiduciary duties or contractual obligations of our officers or directors could materially affect our ability to complete our initial business combination. In addition, our sponsor and our officers and directors have sponsored or formed, or may in the future sponsor or form, other special purpose acquisition companies similar to ours or may pursue other business or investment ventures during the period in which we are seeking an initial business combination. See Summary Prior SPAC Experience . As a result, our sponsor, officers and directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other special purpose acquisition company with which they may become involved. Any such companies, businesses or investments may present additional conflicts of interest in pursuing an initial business combination target. In addition, our sponsor, officers and directors have complete discretion, subject to applicable fiduciary duties, as to which blank check company they choose to pursue a business combination and the order in which they pursue business combinations for any of their future blank check companies, unless such opportunity was introduced to them in their capacity as an officer or director of a specific blank check company. As a result, our sponsor, officers and directors may pursue business combinations for blank check companies that it has sponsored in any order, which could result in its more recent blank check companies completing business combinations prior to its blank check companies that were launched earlier. As a result, any such potential conflicts could materially affect our ability to complete our initial business combination. Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. Corporate Information Our executive offices are located at 2685 Nottingham Avenue, Los Angeles, CA 90027 and our telephone number is (917) 361-1177. We are a Cayman Islands exempted company. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (Revised) of the Cayman Islands, for a period of 30 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. 16 Table of Contents In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that are held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates is equal to or exceeds $250 million as of the prior June 30, or (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates is equal to or exceeds $700 million as of the prior June 30. Finally, after completion of this offering and prior to the consummation of a business combination, only holders of our Class B ordinary shares will have the right to vote on the appointment or removal of directors. As a result, Nasdaq will consider us to be a controlled company within the meaning of Nasdaq corporate governance standards. Under Nasdaq corporate governance standards, a company of which more than 50% of the voting power for the appointment of directors is held by an individual, group or another company is a controlled company and may elect not to comply with certain corporate governance requirements. We currently do not intend to rely on the controlled company exemption, but may do so in the future. Accordingly, if we choose to do so, you will not have the same protections afforded to shareholders of companies that are subject to all of the Nasdaq corporate governance requirements. 17 Table of Contents
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY 1
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+Prospectus Summary 1 Risk Factors 9 Aptos, Aptos MARKET AND REGULATION OF APTos 56 THE TRUST AND APTOS PRICES 62 Calculation of NAV 68 ADDITIONAL INFORMATION ABOUT THE TRUST 70 The Trust s Service Providers 75 Custody of the Trust s Assets 77 THE PRIME EXECUTION AGENT AND the TRADE CREDIT LENDER 79 Form of Shares 85 Transfer of Shares 85 Plan of Distribution 86 Creation and Redemption of Shares 87 Use of Proceeds 92 OWNERSHIP OR BENEFICIAL INTEREST IN THE TRUST 93 Conflicts of Interest 93 FIDUCIARY AND REGULATORY DUTIES AND OBLIGATIONS OF THE SPONSOR 94 Liability and Indemnification 96 Provisions of Law 97 Management; Voting by Shareholders 98 Meetings 98 Books and Records 98 STATEMENTS, FILINGS, AND REPORTS TO SHAREHOLDERS 99 Fiscal Year 99 GOVERNING LAW; CONSENT TO DELAWARE JURISDICTION 99 Legal Matters 99 Experts 99 Material Contracts 100 UNITED STATES FEDERAL INCOME TAX CONSEQUENCES 106 Purchases By Employee Benefit Plans 111 Information You Should Know 113 SUMMARY OF PROMOTIONAL AND SALES MATERIAL 113 Intellectual Property 113 Where You Can Find More Information 113 Privacy Policy 114 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM 115 Statement of financial condition 116 This Prospectus contains information you should consider when making an investment decision about the Shares. You may rely on the information contained in this Prospectus. The Trust and the Sponsor have not authorized any person to provide you with different information and, if anyone provides you with different or inconsistent information, you should not rely on it. This Prospectus is not an offer to sell the Shares in any jurisdiction where the offer or sale of the Shares is not permitted. The Shares are not registered for public sale in any jurisdiction other than the United States. i STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This Prospectus includes "forward-looking statements" that generally relate to future events or future performance. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential," or the negative of these terms or other comparable terminology. All statements (other than statements of historical fact) included in this Prospectus that address activities, events, or developments that will or may occur in the future, including such matters as movements in the digital asset markets, the Trust s operations, the Sponsor s plans, and references to the Trust s future success and other similar matters, are forward-looking statements. These statements are only predictions. Actual events or results may differ materially. These statements are based upon certain assumptions and analyses the Sponsor has made based on its perception of historical trends, current conditions, and expected future developments, as well as other factors appropriate in the circumstances. Whether or not actual results and developments will conform to the Sponsor s expectations and predictions is subject to a number of risks and uncertainties, including: the special considerations discussed in this Prospectus; general economic, market and business conditions; technology developments regarding the use of Aptos and other digital assets, including the systems used by the Sponsor and the Trust s custodian in their provision of services to the Trust; changes in laws or regulations, including those concerning taxes, made by governmental authorities or regulatory bodies; and other world economic and political developments, including, without limitation, global pandemics and the societal and government responses thereto. See
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+PROSPECTUS SUMMARY
+
+ 
+
+This summary highlights information
+contained elsewhere in this prospectus. This summary may not contain all of the information that may be important to you, and we urge
+you to read this entire prospectus carefully, including the "Risk Factors," "Business" and "Management s
+Discussion and Analysis of Financial Condition and Results of Operations" sections and our consolidated financial statements and
+notes to those statements, included elsewhere in this prospectus, before deciding to invest in our shares. This prospectus includes forward-looking
+statements that involve risks and uncertainties. See "Special Note Regarding Forward-Looking Statements."
+
+ 
+
+Our Mission
+
+ 
+
+We are dedicated to empowering
+businesses to achieve sustainable growth through innovative and data-driven marketing solutions. We partner with our clients to develop
+and execute customized strategies that build strong brand identities, maximize market reach, and drive measurable results.
+
+ 
+
+Overview
+
+ 
+
+The Company believes it is and
+will continue to be successful in our space for the following reasons:
+
+ 
+
+ 
+ 
+ 
+ We prioritize our clients needs and goals, fostering long-term partnerships built on trust and mutual respect.
+
+ 
+ 
+ 
+ We leverage data insights and analytics to inform strategic decision-making and optimize campaign performance.
+
+ 
+ 
+ 
+ We embrace new technologies and trends, continuously evolving our approach to stay ahead of the curve.
+
+ 
+ 
+ 
+ We are committed to delivering measurable outcomes that align with our clients business objectives.
+
+ 
+ 
+ 
+ We cultivate a collaborative and supportive environment where diverse perspectives and expertise converge to achieve shared goals.
+
+ 
+ 
+
+Corporate Structure
+
+ 
+
+MediaOn
+Group Inc. is an exempted company incorporated with limited liability in the Cayman Islands on March 20, 2024. As a holding company with
+no material operations of its own, the Company conducts its operations and business in Hong Kong through its BVI subsidiary, MediaOn
+Holdings Limited, which in turn owns a wholly-owned subsidiary in Hong Kong, MediaOn Limited, which owns 55% shareholding in a subsidiary
+in Hong Kong, Mosaic Creative Company Limited with the remaining 45% of shares owned by CHOY, Lap Pong Justin. The Class A
+Ordinary Shares offered in this offering are shares of the Company, a Cayman Islands holding company and not shares of the Hong Kong
+Operating Subsidiaries. Investors in this offering will not directly hold equity interests in any of the Hong Kong Operating Subsidiaries.
+Harney Westwood & Riegels, our counsel as to the laws of the Cayman Islands, has advised us that there is uncertainty as to whether
+the courts of the Cayman Islands would (i) recognize or enforce judgments of U.S. courts obtained against us or our Directors or Executive
+Officers that are predicated upon the civil liability provisions of the U.S. federal securities laws or the securities laws of any U.S.
+state, or (ii) entertain original actions brought in the Cayman Islands against us or our Directors or Executive Officers that are predicated
+upon the U.S. federal securities laws or the securities laws of any U.S. state. This structure involves unique risks to the investors,
+and in the event that our current corporate structure is no longer permissible under the applicable laws and regulations, it would likely
+result in a material change in the Hong Kong Operating Subsidiaries operations and/or a material change in the value of the Ordinary
+Shares being registered in this offering and it could cause the value of such securities to significantly decline or become worthless.
+The following chart summarizes our corporate structure upon completion of this offering (assuming the underwriter does not exercise their
+over-allotment option):
+
+ 
+
+ 5
+
+ 
+
+ 
+
+ 
+
+MEDIAON
+GROUP INC. (the "Company")
+
+Organization
+Chart (After Offering)
+
+ 
+
+ 
+
+As a result of our corporate structure, MediaOn Group s ability
+to pay dividends may depend upon dividends paid by the Hong Kong Operating Subsidiaries. If the Hong Kong Operating Subsidiaries or any
+newly formed ones incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay
+dividends to our Company.
+
+ 
+
+Going Concern
+
+ 
+
+Management has concluded that material uncertainties exist which may raise substantial
+doubt about its ability to continue as a going concern and the auditor of the Company has included an explanatory paragraph relating to
+its ability to continue as a going concern in its auditor s report for the years ended September 30, 2024 and 2023. During the six
+months ended March 31, 2025 and 2024, the Company generated $828,923 and $1,287,736, respectively, in revenue, net loss of $333,781 and
+net income of $67,542, respectively, and cash out flows from operating activities of $100,834 and $1,089,165, respectively. During the
+years ended September 30, 2024 and 2023, the Company generated $2,804,375 and $3,966,115, respectively, in revenues, net loss of $165,103
+and net income of $1,060,906, respectively, and cash flows (used in) operating activities of $960,540 and $118,582, respectively. As at
+September 30, 2024, the Company had an accumulated deficit of $1,958,442. The continued operations of the Company is dependent on the
+success of this offering, future profitable operations, management s ability to manage costs and the future availability of equity
+or debt financing. The above events and conditions indicate a material uncertainty that may cast significant doubt about the ability of
+the Company to continue as a going concern and the auditor of the Company has included an explanatory paragraph relating to its ability
+to continue as a going concern in its auditor s report for the years ended September 30, 2024 and 2023. The financial statements
+included elsewhere in this filing, have been prepared on the basis that the Company will operate as a going concern, which contemplates
+the realization of assets and settlement of liabilities and commitments in the normal course of business. The financial statements do
+not include adjustments to amounts and classifications of assets and liabilities that might be necessary should the Company be unable
+to continue as a going concern. The financial statements of the Company do not include any adjustments that might result from the outcome
+of this uncertainty. In addition, the value of our Ordinary Shares issued in this Offering would be greatly impaired if we are unable
+to continue as a going concern.
+
+ 
+
+Our
+ability to continue as a going concern is dependent upon generating sufficient cash flow from operations and obtaining additional
+capital and financing, including debts, equity financing and funds to be raised in this offering. If our ability to generate cash
+flow from operations is reduced and we are unable to raise additional funding from other sources, we may be unable to continue in
+business even if this offering is successful. For further discussion about our ability to continue as a going concern and our plan
+for future liquidity, see "Management s Discussion and Analysis of Financial Condition and Results of
+Operations—Ability to Continue as a Going Concern."
+
+ 
+
+Business Streams
+
+ 
+
+We
+are a marketing and advertising services provider offering campaign development, media placement, and strategic brand services through
+eight integrated business lines. We generate revenue through: (i) service-based marketing campaigns; (ii) commission-based media placement
+activities; and (iii) volume-based media rebates from advertising vendors. These products and services, including influencer marketing,
+TVC production, AR/VR campaigns, and digital ad buys, position us as a versatile partner to clients seeking measurable brand impact across
+channels and markets.
+
+ 
+
+Competitive Strengths
+
+ 
+
+We believe our competitive strength lies with the
+following:
+
+ 
+
+ 
+ 
+ 
+ Comprehensive Service Offerings: Our comprehensive service offerings allow clients to access a diverse set of solutions from a single trusted partner. This integrated approach sets us apart from competitors who may offer limited services.
+
+ 
+ 
+ 
+ Tailor-made Solutions: We understand that every business is unique, and we tailor our strategies to meet the specific needs and challenges of each client.
+
+ 
+ 
+ 
+ Experienced Team: Our team comprises seasoned marketing professionals with a proven track record of success across various industries.
+
+ 
+ 
+ 
+ Deep Industry Expertise: With years of experience in the media and event management industry, we boast deep industry expertise.
+
+ 
+ 
+ 
+ Innovative and Creative Approach: By constantly embracing new technologies and creative strategies, we stay ahead of the curve and provide innovative solutions that differentiate us from competitors.
+
+ 
+ 
+ 
+ Data-Driven Approach: We leverage data analytics to gain a deeper understanding of target audiences, optimize campaign performance, and measure ROI effectively.
+
+ 
+ 
+ 
+ Technological Expertise: We leverage advanced analytics, AI-driven tools, and digital platforms to optimize marketing strategies, enhance campaign performance, and deliver data-driven insights to our clients
+
+ 
+ 
+ 
+ Strong Network and Partnerships: We has strong partnerships allow us to access top-quality resources, negotiate favorable rates, and deliver high-quality services to our clients.
+
+ 
+ 
+ 
+ Track Record of Success: We has a proven track record of delivering successful events and campaigns for a diverse range of clients. Our portfolio showcases numerous impactful projects and satisfied clients.
+
+ 
+ 
+ 
+ Global Reach: We have a global network of partners and resources, enabling us to support clients in expanding their reach and achieving international success.
+
+ 
+
+ 
+
+Growth strategies
+
+ 
+
+Our principal objective is to
+grow our business and strengthen our market position with the following strategies:
+
+ 
+
+ 
+ 
+ 
+ Expand Service Offerings: Explore opportunities in emerging digital marketing channels, such as influencer marketing or virtual events, to diversify our offerings and capture new market segments.
+
+ 
+ 
+ 
+ Geographic Expansion: Targeting new regions or countries allows us to tap into new customer bases and leverage our expertise in different markets.
+
+ 
+ 
+ 
+ Strategic Partnerships and Acquisitions: By partnering with companies that offer synergistic services or have access to untapped markets, we can expand our capabilities and market reach. Acquisitions can also provide opportunities to integrate new talent, technologies, or client portfolios into our business.
+
+ 
+ 
+ 
+ Invest in Technology and Innovation: Invest in research and development to enhance our technological capabilities, leverage data analytics and AI-driven solutions, and explore emerging technologies such as virtual reality or augmented reality.
+
+ 
+ 
+ 
+ Enhance Marketing and Branding Efforts: A strong marketing and branding strategy is essential for growth. By effectively communicating our unique value proposition and differentiating ourselves from competitors, we can attract new clients and strengthen existing relationships.
+
+ 
+ 
+ 
+ Continuous Learning and Development: We invest
+ in employee training, industry certifications, and staying updated on industry trends allows us to offer the latest solutions and
+ maintain a knowledgeable and skilled team.
+
+ 
+ 
+
+ 6
+
+ 
+
+ 
+ 
+
+Risks and Challenges
+
+ 
+
+Investing in our Shares involves
+risks. The risks summarized below are qualified by reference to "Risk Factors" beginning on page 16 of this prospectus,
+which you should carefully consider before making a decision to purchase shares. If any of these risks actually occurs, our business,
+financial condition or results of operations would likely be materially adversely affected. In such case, the trading price of our Shares
+would likely decline, and you may lose all or part of your investment.
+
+ 
+
+These risks include but are
+not limited to the following:
+
+ 
+
+Risks Related to our
+Business and Industry
+
+ 
+
+ Management
+ has concluded that material uncertainties exist which may raise substantial doubt about its
+ ability to continue as a going concern and the auditor of the Company has included an explanatory
+ paragraph relating to its ability to continue as a going concern in its auditor s report
+ for the years ended September 30, 2024 and 2023. (See "Risk Factors — Risks
+ Related to our Business and Industry" on page 16);
+
+ 
+
+ We
+ are involved in the highly competitive advertising industry and may not be able to compete
+ successfully with our competitors, which could reduce our market share and adversely affect
+ our financial condition. (See "Risk Factors — Risks Related to our Business
+ and Industry" on page 16);
+
+ 
+
+ Cutbacks
+ on advertising budgets by our clients and failure to maintain and grow our client base could
+ materially and adversely affect our business and harm our financial condition. (See "Risk
+ Factors — Risks Related to our Business and Industry" on page 16);
+
+ 
+
+ Our
+ limited operating history in a rapidly evolving industry makes it difficult to accurately
+ forecast our future operating results and evaluate our business prospects. (See "Risk
+ Factors — Risks Related to our Business and Industry" on page 17);
+
+ 
+
+ We
+ may be unable to successfully implement or implement in full and effectively our future business
+ plans and business strategies. (See "Risk Factors — Risks Related to our Business
+ and Industry" on page 17);
+
+ 
+
+ Our
+ operating results depend on our ability to respond quickly to changes in the marketing preferences
+ of our clients. (See "Risk Factors — Risks Related to our Business and Industry"
+ on page 17);
+
+ 
+
+ Our
+ business is highly sensitive to changing preferences of audiences. (See "Risk Factors
+ — Risks Related to our Business and Industry" on page 17);
+
+ 
+
+ The
+ advertising industry is subject to uncertainties that could affect our business and results
+ of operations. (See "Risk Factors — Risks Related to our Business and Industry"
+ on page 17);
+
+ 
+
+ If
+ we fail to keep pace with rapidly changing technologies, we could lose our clients, and our
+ business and results of operations could be adversely affected. (See "Risk Factors
+ — Risks Related to our Business and Industry" on page 18);
+
+ 
+
+ Our
+ services are generally project-based, and we generally do not enter into long-term agreements
+ with our clients. If we fail to retain existing clients or attract new clients, our results
+ of operations could be materially affected. (See "Risk Factors — Risks Related
+ to our Business and Industry" on page 18);
+
+ 
+
+ If
+ we are unable to secure engagements from our clients, our business and financial performance
+ may be adversely affected. (See "Risk Factors — Risks Related to our Business
+ and Industry" on page 18);
+
+ 
+
+ If
+ we fail to achieve the marketing objectives of our clients, we could lose our clients and
+ our revenue could decline. (See "Risk Factors — Risks Related to our Business
+ and Industry" on page 18 );
+
+ 
+
+ The
+ marketing industry is highly schedule driven, and our failure to meet the schedule requirements
+ of our clients could adversely affect our reputation and/or expose us to financial liability.
+ (See "Risk Factors — Risks Related to our Business and Industry" on
+ page 19);
+
+ 
+
+ The
+ quality of work performed by our independent suppliers may affect our sales and damage our
+ reputation. (See "Risk Factors — Risks Related to our Business and Industry"
+ on page 19);
+
+ 
+
+ If
+ we experience information and technological system failures, our business operations could
+ be significantly disrupted. (See "Risk Factors — Risks Related to our Business
+ and Industry" on page 19);
+
+ 
+
+ Seasonality
+ in our services may affect our business and operating results. (See "Risk Factors
+ — Risks Related to our Business and Industry" on page 19);
+
+ 
+
+ We
+ may not be able to execute our strategies effectively, which may materially and adversely
+ affect our business and prospects. (See "Risk Factors — Risks Related to our
+ Business and Industry" on page 19);
+
+ 
+
+ We
+ may not have adequate insurance coverage to cover our potential losses and claims in connection
+ with our business. (See "Risk Factors — Risks Related to our Business and
+ Industry" on page 20);
+
+ 
+
+ Our
+ business, financial conditions, and results of operations could be affected if we fail to
+ attract and retain our key personnel, management team, and our employees. (See "Risk
+ Factors — Risks Related to our Business and Industry" on page 20);
+
+ 
+
+ Our
+ outstanding debt agreements may limit our flexibility in operating and expanding our business.
+ (See "Risk Factors — Risks Related to our Business and Industry" on
+ page 20); 
+
+ 
+
+ 7
+
+ 
+
+ 
+ 
+
+Risks Related to Doing Business in Hong
+Kong
+
+ 
+
+ A
+ downturn in the Hong Kong or global economy could materially and adversely affect our Hong
+ Kong Operating Subsidiaries business and financial condition. (See "Risk
+ Factors — Risks Related to Doing Business in Hong Kong" on page 20);
+
+ 
+
+ Substantially
+ all of our operations are in Hong Kong. However, the current PRC laws and regulations may
+ influence our operations, which could result in a material change in our operations and/or
+ the value of our Ordinary Shares. (See "Risk Factors — Risks Related to Doing
+ Business in Hong Kong" on page 20);
+
+ 
+
+ The
+ PRC government may intervene or influence our operations at any time, which could result
+ in a material change in our operations and/or the value of our Ordinary Shares. (See "Risk
+ Factors — Risks Related to Doing Business in Hong Kong" on page 21);
+
+ 
+
+ If
+ the PRC government chooses to exert more oversight and control over offerings that are conducted
+ overseas and/or foreign investment in China-based issuers, and if we become subject to such
+ oversight and control, such action may significantly limit or completely hinder our ability
+ to offer or continue to offer Ordinary Shares to investors and cause the value of our Ordinary
+ Shares to significantly decline or be worthless. (See "Risk Factors — Risks
+ Related to Doing Business in Hong Kong" on page 21);
+
+ 
+
+ Although
+ we are based in Hong Kong, if we should become subject to the recent scrutiny, criticism
+ and negative publicity involving U.S.-listed China-based companies, we may have to expend
+ significant resources to investigate and/or defend the allegations, which could harm our
+ Hong Kong Operating Subsidiaries business operations, this offering and our reputation,
+ and could result in a loss of your investment in our Ordinary Shares if such allegations
+ cannot be addressed and resolved favorably. (See "Risk Factors — Risks Related
+ to Doing Business in Hong Kong" on page 22);
+
+ 
+
+ There
+ are political risks associated with conducting business in Hong Kong. (See "Risk
+ Factors— Risks Related to Doing Business in Hong Kong" on page 23);
+
+ 
+
+ The
+ PRC laws, rules and regulations that apply or are to be applied to Hong Kong, and the enforcement
+ of the same, can change quickly with little or no advance notice. As a result, the Hong Kong
+ legal system embodies uncertainties which could limit the availability of legal protections,
+ which could result in a material change in our Hong Kong Operating Subsidiaries operations
+ and/or the value of the securities we are registering for sale. (See "Risk Factors—
+ Risks Related to Doing Business in Hong Kong" on page 23);
+
+ 
+
+ Changes
+ in international trade policies, trade disputes, barriers to trade or the emergence of a
+ trade war may have a material and adverse effect upon us. (See "Risk Factors—
+ Risks Related to Doing Business in Hong Kong" on page 24);
+
+ 
+
+ The
+ Company may rely on dividends and other distributions on equity paid by the Hong Kong Operating
+ Subsidiaries to fund any cash and financing requirements it may have, and any limitations
+ or restrictions, prohibitions or limitations on the ability of the Company or our Hong Kong
+ Operating Subsidiaries by the PRC government to transfer cash or assets in or out of Hong
+ Kong may result in these funds or assets not being available to fund operations or for other
+ uses outside of Hong Kong, which on the ability of the Hong Kong Operating Subsidiaries to
+ make payments to the Company could have a material and adverse effect on the business. (See
+ "Risk Factors— Risks Related to Doing Business in Hong Kong" on page
+ 24);
+
+ 
+
+ The
+ PCAOB Determinations provides that if the PCAOB is unable to inspect or investigate completely
+ registered public accounting firms headquartered in China or Hong Kong, a Special Administrative
+ Region and dependency of the PRC, because of a position taken by one or more authorities
+ in China or Hong Kong, it could result in the prohibition of trading in our securities by
+ not being allowed to list on a U.S. exchange, and as a result an exchange may determine to
+ delist our securities, which would materially affect the interest of our investors. (See
+ "Risk Factors— Risks Related to Doing Business in Hong Kong" on page
+ 24);
+
+ 
+
+ The
+ enactment of Law of the PRC on Safeguarding National Security in the Hong Kong (the "Hong
+ Kong National Security Law") could impact our Hong Kong Operating Subsidiaries. (See
+ "Risk Factors— Risks Related to Doing Business in Hong Kong" on page
+ 26);
+
+ 
+
+ We
+ may become subject to a variety of PRC laws and other regulations regarding privacy, cybersecurity,
+ data protection, data security or securities offerings that are conducted overseas and/or
+ other foreign investment in China-based issuers. Any failure to comply with applicable laws
+ and regulations could have a material and adverse effect on our business, financial condition
+ and results of operations and may hinder our ability to offer or continue to offer Ordinary
+ Shares to investors and cause the value of our Ordinary Shares to significantly decline or
+ be worthless. (See "Risk Factors— Risks Related to Doing Business in Hong
+ Kong" on page 26);
+
+ 
+
+ The
+ Hong Kong legal system is subject to uncertainties which could limit the legal protections
+ available to us. (See "Risk Factors— Risks Related to Doing Business in Hong
+ Kong" on page 28);
+
+ 
+
+Risks Related to Litigation, Laws and Regulation
+and Governmental Matters
+
+ 
+
+ Unfavorable
+ global and regional economic, political and health conditions could adversely affect our
+ business, financial condition or results of operations. (See "Risk Factors —
+ Risks Related to Litigation, Laws and Regulation and Governmental Matters" on page
+ 28);
+
+ 
+
+ Potential
+ claims from customers or employees could have a material adverse effect on our business.
+ (See "Risk Factors — Risks Related to Litigation, Laws and Regulation and
+ Governmental Matters" on page 29);
+
+ 
+
+ It
+ will be difficult to obtain jurisdiction and enforce liabilities against our officers, Directors
+ and assets outside the United States. (See "Risk Factors — Risks Related
+ to Litigation, Laws and Regulation and Governmental Matters" on page 29);
+
+ 
+
+ Changes
+ in foreign currency exchange rates may negatively affect our financial condition and results
+ of operations. (See "Risk Factors — Risks Related to Litigation, Laws and
+ Regulation and Governmental Matters" on page 29);
+
+ 
+
+ 8
+
+ 
+
+ 
+
+ 
+
+Risks Related to Being a Public Company
+
+ 
+
+ 
+ 
+ 
+ Public
+ company compliance may make it more difficult to attract and retain officers and Directors. (See "Risk Factors — Risks
+ Related to Being a Public Company" on page 29);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ have no experience operating as a public company. (See "Risk Factors — Risks Related to Being a Public Company"
+ on page 29);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ will be subject to changing laws, rules and regulations in the U.S. regarding regulatory matters, corporate governance and public
+ disclosure that will increase both our costs and the risks associated with non-compliance. (See "Risk Factors — Risks
+ Related to Being a Public Company" on page 30);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ are a foreign private issuer and, as a result, are not subject to U.S. proxy rules but are subject to Exchange Act reporting obligations
+ that, to some extent, are more lenient and less frequent than those of a U.S. issuer. (See "Risk Factors — Risks Related
+ to Being a Public Company" on page 30);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Because
+ we are a foreign private issuer and are exempt from certain Nasdaq corporate governance standards applicable to U.S. issuers, you
+ will have less protection than you would have if we were a domestic issuer. (See "Risk Factors — Risks Related to
+ Being a Public Company" on page 30);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ may lose our foreign private issuer status in the future, which could result in significant additional costs and expenses. (See "Risk
+ Factors — Risks Related to Being a Public Company" on page 31);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ As
+ an exempted company incorporated in the Cayman Islands with limited liability, we are permitted to adopt certain home country practices
+ in relation to corporate governance matters that may differ significantly from Nasdaq corporate governance listing standards. These
+ practices may afford less protection to shareholders than they would enjoy if we complied fully with Nasdaq corporate governance
+ listing standards. (See "Risk Factors — Risks Related to Being a Public Company" on page 31);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ You
+ may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because
+ we are incorporated under Cayman Islands law. (See "Risk Factors — Risks Related to Being a Public Company"
+ on page 32).
+
+ 
+ 
+
+Risks Related to Ownership of our Securities
+
+ 
+
+ 
+ 
+ 
+ Investors
+ in this offering will experience immediate and substantial dilution in net tangible book value. (See "Risk Factors —
+ Risks Related to Ownership of our Securities" on page 32);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Substantial
+ future sales of our Ordinary Shares or the anticipation of future sales of our Shares in the public market could cause the price
+ of our Ordinary Shares to decline. (See "Risk Factors — Risks Related to Ownership of our Securities"
+ on page 32);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Because
+ we do not expect to pay dividends in the foreseeable future, you must rely on price appreciation of our Ordinary Shares for a return
+ on your investment. (See "Risk Factors — Risks Related to Ownership of our Securities" on page 33);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ Ordinary Shares will be subject to potential delisting if we do not meet or continue to maintain the listing requirements of Nasdaq.
+ (See "Risk Factors — Risks Related to Ownership of our Securities" on page 33);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ There
+ has been no prior public trading market for our Ordinary Shares and an active trading market may not develop or be sustained following
+ this offering. (See "Risk Factors — Risks Related to Ownership of our Securities" on page 33);
+
+ 
+ 
+
+ 9
+
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ The
+ market price of our equity securities may be volatile, and your investment could suffer or decline in value. (See "Risk
+ Factors — Risks Related to Ownership of our Securities" on page 33);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ In
+ the event that our Ordinary Shares are listed on Nasdaq, our share price could fall and we could be delisted in which case broker-dealers
+ may be discouraged from effecting transactions in our Ordinary Shares because they may be considered penny stocks and thus be subject
+ to the penny stock rules. (See "Risk Factors — Risks Related to Ownership of our Securities" on page 34);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We
+ may issue preferred shares, the terms of which could adversely affect the voting power or value of Ordinary Shares. (See "Risk
+ Factors — Risks Related to Ownership of our Securities" on page 35);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ If
+ securities analysts were to downgrade our Shares, publish negative research or reports or fail to publish reports about our business,
+ our competitive position could suffer, and our share price and trading volume could decline. (See "Risk Factors —
+ Risks Related to Ownership of our Securities" on page 35);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ requirements of being a public company, including compliance with the reporting requirements of the Exchange Act, and the requirements
+ of the Sarbanes-Oxley Act, may strain our resources, increase our costs and divert management s attention, and we may be unable
+ to comply with these requirements in a timely or cost-effective manner. (See "Risk Factors — Risks Related
+ to Ownership of our Securities" on page 35);
+
+ 
+ 
+
+ 
+ 
+ 
+ Our
+ internal control over financial reporting may not be effective and our independent registered public accounting firm may not be able
+ to certify as to their effectiveness in the future, which could have a significant and adverse effect on our business, financial
+ condition, results of operations and reputation. (See "Risk Factors — Risks Related to Ownership of our Securities"
+ on page 36);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Management
+ will have broad discretion over the use of our proceeds from this offering. (See "Risk Factors — Risks Related to
+ Ownership of our Securities" on page 36);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ For
+ as long as we are an emerging growth company, we will not be required to comply with certain requirements that apply to other public
+ companies. (See "Risk Factors — Risks Related to Ownership of our Securities" on page 37).
+
+ 
+
+ 
+
+Holding Foreign Companies Accountable Act
+
+ 
+
+The HFCA Act was enacted on December
+18, 2020. The HFCA Act states if the SEC determines that a company has filed audit reports issued by a registered public accounting firm
+that has not been subject to inspection by the PCAOB for three consecutive years beginning in 2021, the SEC shall prohibit the company s
+shares from being traded on a national securities exchange or in the over-the-counter trading market in the United States.
+
+ 
+
+On March 24, 2021, the SEC adopted
+interim final rules relating to the implementation of certain disclosure and documentation requirements of the HFCA Act. A company will
+be required to comply with these rules if the SEC identifies it as having a "non-inspection" year under a process to be subsequently
+established by the SEC. The SEC is assessing how to implement other requirements of the HFCA Act, including the listing and trading prohibitions
+described above.
+
+ 
+
+On December 23, 2022, the Accelerating
+HFCA Act (the "Accelerating HFCA Act") was signed into law, which amended the HFCA Act by requiring the SEC to prohibit an
+issuer s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive
+years instead of three. On December 29, 2022, the Consolidated Appropriations Act was signed into law by President Biden. The Consolidated
+Appropriations Act contained, among other things, an identical provision to the Accelerating HFCA Act, which reduces the number of consecutive
+non-inspection years required for triggering the prohibitions under the HFCA Act from three years to two.
+
+ 
+
+ 10
+
+ 
+
+ 
+
+ 
+
+On December 2, 2021, the SEC issued
+amendments to finalize rules implementing the submission and disclosure requirements in the HFCA Act. The rules apply to registrants that
+the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located
+in a foreign jurisdiction and that PCAOB is unable to inspect or investigate completely because of a position taken by an authority in
+foreign jurisdictions.
+
+ 
+
+On December 16, 2021, PCAOB announced
+the PCAOB HFCA Act determinations (the "PCAOB Determinations") relating to the PCAOB s inability to inspect or investigate
+completely registered public accounting firms headquartered in China or Hong Kong, a Special Administrative Region and dependency of the
+PRC, because of a position taken by one or more authorities in the PRC or Hong Kong. The PCAOB Determinations provide that if the PCAOB
+is unable to inspect or investigate completely registered public accounting firms headquartered in China or Hong Kong and dependency of
+the PRC, because of a position taken by one or more authorities in China or Hong Kong, it could result in the prohibition of trading in
+our securities by not being allowed to list on a U.S. exchange, and as a result an exchange may determine to delist our securities, which
+would materially affect the interest of our investors.
+
+ 
+
+Our auditor, TAAD LLP, the independent
+registered public accounting firm that issues the audit report included in this prospectus, as an auditor of companies that are traded
+publicly in the United States and a firm registered with the PCAOB, is subject to laws in the United States pursuant to which the PCAOB
+conducts regular inspections to assess. TAAD LLP is headquartered in California and has been inspected by the PCAOB on a regular basis,
+with the last inspection in November 2022. Therefore, we believe that, as of the date of this prospectus, our auditor is not subject to
+the PCAOB Determinations. See "Risk Factors — Risks Relating to Securities and this Offering — The PCAOB Determinations
+provides that if the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in China or
+Hong Kong, a Special Administrative Region and dependency of the PRC, because of a position taken by one or more authorities in China
+or Hong Kong it could result in the prohibition of trading in our securities by not being allowed to list on a U.S. exchange, and as a
+result an exchange may determine to delist our securities, which would materially affect the interest of our investors." on
+page 24. We cannot assure you whether Nasdaq or other regulatory authorities will apply additional or more stringent criteria to us. Such
+uncertainty could cause the market price of our Ordinary Shares to be materially and adversely affected.
+
+ 
+
+On August 26, 2022, the PCAOB
+signed a Statement of Protocol (the "SOP") with the CSRC and the Ministry of Finance of the PRC. The SOP, together with two
+protocol agreements governing inspections and investigations, establishes a specific, accountable framework to make possible complete
+inspections and investigations by the PCAOB of audit firms based in China and Hong Kong, as required under U.S. law.
+
+ 
+
+On December 15, 2022, the PCAOB
+announced that it has completed a test inspection of two selected auditing firms in China and Hong Kong and has voted to vacate its previous
+Determination Report, which concluded in December 2021 that the PCAOB could not inspect or investigate completely registered public accounting
+firms based in China or Hong Kong. However, if in the future the PCAOB is prohibited from conducting complete inspections and investigations
+of PCAOB-registered public accounting firms in China and Hong Kong, then the companies audited by those registered public accounting firms
+could be subject to a trading prohibition on U.S. markets pursuant to the HFCA Act.
+
+ 
+
+Corporate Information
+
+ 
+
+We were incorporated in the Cayman
+Islands as an exempted company with limited liability on March 20, 2024. Our registered office in the Cayman Islands is at the offices
+of Quality Corporate Services Ltd., Suite 102, Cannon Place, P.O. Box 712, North Sound Road, George Town, Grand Cayman, Cayman Islands.
+Our principal executive office is at 4/F., KOHO, 73-75 Hung To Road, Kwun Tong, Hong Kong. Our telephone number at this location is +852
+2388-2025. Our principal website address is www.mediaon.digital. The information contained on our website does not form part of this prospectus.
+Our agent for service of process in the United States is Puglisi & Associates, 850 Library Avenue, Suite 204, Newark, Delaware 19711.
+
+ 
+
+Because we are incorporated under
+the laws of the Cayman Islands, you may encounter difficulty protecting your interests as a shareholder, and your ability to protect your
+rights through the U.S. federal court system may be limited. Please refer to the sections entitled "Risk Factors" and "Enforceability
+of Civil Liabilities" for more information.
+
+ 
+
+ 11
+
+ 
+
+ 
+
+ 
+
+Implications of Our Being an Emerging Growth Company
+
+ 
+
+As a company with less than US$1.235
+billion in revenue during our last fiscal year, we qualify as an "emerging growth company" as defined in the Jumpstart Our
+Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other
+requirements that are otherwise applicable generally to public companies. These provisions include:
+
+ 
+
+ 
+ 
+ 
+ being permitted to provide only two years of selected financial information (rather than five years) and only two years of audited financial statements (rather than three years), in addition to any required unaudited interim financial statements, with correspondingly reduced "Management s Discussion and Analysis of Financial Condition and Results of Operations" disclosure; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an exemption from compliance with the auditor attestation requirement of the Sarbanes-Oxley Act, on the effectiveness of our internal control over financial reporting.
+
+ 
+ 
+
+We may take advantage of these
+reporting exemptions until we are no longer an emerging growth company. We will remain an emerging growth company until the earliest of
+(1) the last day of the fiscal year in which the fifth anniversary of the completion of this offering occurs, (2) the last day of the
+fiscal year in which we have total annual gross revenue of at least US$1.235 billion, (3) the date on which we are deemed to be a "large
+accelerated filer" under the Exchange Act, which means the market value of our shares that are held by non-affiliates exceeds US$700.0
+million as of the prior December 31, and (4) the date on which we have issued more than US$1.0 billion in non-convertible debt during
+the prior three-year period. We may choose to take advantage of some, but not all, of the available exemptions. We have included two years
+of selected financial data in this prospectus in reliance on the first exemption described above. Accordingly, the information contained
+herein may be different from the information you receive from other public companies in which you hold stock.
+
+ 
+
+Implications of Being a "Controlled Company"
+
+ 
+
+Upon completion of this offering,
+assuming no exercise of overallotment, our issued and outstanding shares will consist of 5,500,000 shares of Class A Ordinary
+Shares and 16,500,000 Class B Ordinary Shares. We will be a controlled company as defined under the Nasdaq Capital Market Company
+Guide Section 801(a), immediately after the completion of this offering, Tech Vision Investments Limited, our controlling shareholder,
+will own 16,500,000 Class B Ordinary Shares, or 75.00% of our total issued and outstanding Ordinary Shares, representing
+approximately 98.36% of the total voting power assuming the underwriter fully exercises its over-allotment option. Consequently,
+our controlling shareholder will have the ability to determine all matters requiring approval by shareholders. Because we will be a "controlled
+company" within the meaning of the Nasdaq Capital Market Rules, we are eligible for certain exemptions from the corporate governance
+requirements of the Nasdaq Capital Market listing rules. For so long as we remain a controlled company as defined under Nasdaq Capital
+Market Rules, we are exempt from, and our shareholders generally are not provided with the benefits of, some of the Nasdaq Stock Market
+corporate governance requirements, including that:
+
+ 
+
+ a majority of our board
+of directors must be independent directors;
+
+ 
+
+ our compensation committee
+must be composed entirely of independent directors; and
+
+ 
+
+ our corporate governance
+and nomination committee must be composed entirely of independent directors.
+
+ 
+
+However, as of the date of this
+prospectus, we intend to have a majority of independent directors, a compensation committee that is composed entirely of independent directors
+and our corporate governance and nomination committee that is composed entirely of independent directors and do not intend to avail ourselves
+of any of these exemptions available to controlled companies.
+
+ 
+
+Implications of Our Being a Foreign Private Issuer
+
+ 
+
+Upon completion of this offering,
+we will report under the Exchange Act as a non-U.S. company with foreign private issuer status. Even after we no longer qualify as an
+emerging growth company, as long as we qualify as a foreign private issuer under the Exchange Act, we will be exempt from certain provisions
+of the Exchange Act that are applicable to U.S. domestic public companies, including:
+
+ 
+
+ 
+ 
+ 
+ the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act;
+
+ 
+ 
+
+ 12
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the rules under the Exchange Act requiring the filing with the Securities and Exchange Commission, or the SEC, of quarterly reports on Form 10-Q containing unaudited financial and other specified information, or current reports on Form 8-K, upon the occurrence of specified significant events.
+
+ 
+ 
+
+Both foreign private issuers and
+emerging growth companies are also exempt from certain more stringent executive compensation disclosure rules. Thus, even if we no longer
+qualify as an emerging growth company but remain a foreign private issuer, we will continue to be exempt from the more stringent compensation
+disclosures required of companies that are neither emerging growth companies nor foreign private issuers.
+
+ 
+
+In addition, as an exempted company
+incorporated in the Cayman Islands with limited liability, we are permitted to adopt certain home country practices in relation to corporate
+governance matters that differ significantly from the corporate governance listing requirements of the Nasdaq. These practices may afford
+less protection to shareholders than they would enjoy if we complied fully with corporate governance listing requirements of the Nasdaq.
+Following this offering, we will rely on home country practice to be exempted from certain of the corporate governance requirements of
+the NASDAQ, which includes the following:
+
+ 
+
+ 
+ 
+ 
+ Rule 5605(b)(2), pursuant to which the independent directors must
+ have regularly scheduled meetings at which only independent directors are present;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Rule 5635(a), pursuant to which shareholder approval is required
+ in certain circumstances prior to an issuance of securities in connection with the acquisition of the stock or assets of another
+ company; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Rule 5635(b), pursuant to which shareholder approval is required
+ prior to the issuance of securities when the issuance or potential issuance will result in a change of control of the company.
+
+ 
+
+ 
+
+Holding Company Structure
+
+ 
+
+We are an exempted company incorporated
+in the Cayman Islands with limited liability with no material operations of our own, and we conduct our operations primarily in Hong Kong
+through the Hong Kong Operating Subsidiaries. This is an offering of the Class A Ordinary Shares of MediaOn Group, Inc., the holding company
+in the Cayman Islands, instead of the shares of the Hong Kong Operating Subsidiaries. Investors in this offering will not directly hold
+any equity interests in the Hong Kong Operating Subsidiaries.
+
+ 
+
+As a result of our corporate structure,
+MediaOn Group s ability to pay dividends may depend upon dividends paid by the Hong Kong Operating Subsidiaries. If the Hong Kong
+Operating Subsidiaries or any newly formed ones incur debt on their own behalf in the future, the instruments governing their debt may
+restrict their ability to pay dividends to the Company.
+
+ 
+
+Transfers of Cash to and From Our Subsidiaries
+
+ 
+
+Our management closely monitors
+the cash position of our Group to ensure it has the necessary funds to fulfill its obligations for the foreseeable future and to ensure
+adequate liquidity. In the event that there is a need for cash or a potential liquidity issue, it will be reported to our Chief Financial
+Officer and subject to approval by our Board.
+
+ 
+
+The ability of our Company to
+transfer cash to its subsidiaries is subject to the following: subject to due corporate authorization in accordance with the Amended and
+Restated Memorandum and Articles of Association of our Company and our Company being solvent and able to pay its debts, our Company is
+permitted under the laws of the Cayman Islands and its Amended and Restated Memorandum and Articles of Association to provide funding
+to our subsidiaries incorporated in the BVI and Hong Kong through loans or capital contributions. Our Company s subsidiary formed
+under the laws of the BVI (the "BVI Subsidiary") is permitted under the laws of the BVI to provide funding to our Hong Kong
+Operating Subsidiaries subject to certain restrictions laid down in the BVI Business Companies Act (as amended) and memorandum and articles
+of association of the relevant Company s subsidiary incorporated under the laws of the BVI.
+
+ 
+
+ 13
+
+ 
+
+ 
+
+ 
+
+The ability of the BVI Subsidiary,
+the direct subsidiary of our Company, to transfer cash to the Company is subject to the following: according to the BVI Business Companies
+Act (as amended), the BVI Subsidiary may make dividends distribution to the extent that immediately after the distribution, the value
+of the company s assets exceeds its liabilities and that such company is able to pay its debts as they fall due.
+
+ 
+
+The ability of the Company s
+subsidiaries incorporated in Hong Kong (the "Hong Kong Subsidiaries") to transfer cash to the BVI Subsidiary is subject to
+the following: according to the Companies Ordinance of Hong Kong, the Hong Kong Subsidiaries may only make a distribution out of profits
+available for distribution. We did not adopt or maintain any cash management policies and procedures as of the date of this prospectus.
+
+ 
+
+Currently, all of our operations
+are in Hong Kong. Hong Kong is a special administrative region of the PRC and the basic policies of the PRC regarding Hong Kong are reflected
+in the Basic Law. The arrangement provides Hong Kong with a high degree of autonomy and executive, legislative and independent judicial
+powers, including that of final adjudication under the principle of "one country, two systems" and a distinct set of laws
+and regulations. The laws and regulations of China do not currently have any impact on transfer of cash from our Company to our Hong Kong
+Subsidiaries or from our Hong Kong Subsidiaries to our Company and U.S. investors. There are currently also no restrictions or limitations
+under the laws of Hong Kong imposed on the conversion of HKD into foreign currencies and the remittance of currencies out of Hong Kong,
+nor is there any restriction on any foreign exchange to transfer cash between our Company and our Hong Kong Subsidiaries, across borders
+and to U.S. investors, nor there are any restrictions and limitations to distribute earnings from our Hong Kong Subsidiaries to our Company
+and U.S. investors and amounts owed. Further, there can be no assurance that the flow of cash in or out of Hong Kong would not be restricted
+or prohibited. To the extent the Company s cash or assets in the business are in Hong Kong or a Hong Kong entity, the Company s
+funds or assets may, in the future, not be available to fund operations or for other use outside of Hong Kong due to interventions in
+or the imposition of restrictions and limitations on the ability of the Company and our Hong Kong Operating Subsidiaries by the PRC government
+to transfer cash or assets. Any restrictions, prohibitions, interventions or limitations on the ability of the Company or our Hong Kong
+Operating Subsidiaries to transfer cash or assets in or out of Hong Kong may result in these funds or assets not being available to fund
+operations or for other uses outside of Hong Kong, which could have a material adverse effect on our ability to conduct our business.
+
+ 
+
+During the years ended September
+30, 2024 and 2023 and through the date of this prospectus, the Company, the BVI Subsidiary and the Hong Kong Operating Subsidiaries
+have not distributed any cash dividends or made any other cash distributions.
+
+ 
+
+During the years ended September
+30, 2024 and 2023, and through the date of this prospectus there were no cash transfers among the Company, the BVI subsidiary
+and the Hong Kong Operating Subsidiaries.
+
+ 
+
+Permission Required from Hong Kong and PRC Authorities
+
+ 
+
+As
+of the date of this prospectus, (i) in the opinion of our Hong Kong legal counsel, Cheung, Yeung & Lee, Solicitors, our Hong Kong
+Subsidiaries have received all requisite permissions and approvals for the operation of our business in Hong Kong, specifically, the
+business registration certificates issued by the Hong Kong Business Registration Office, and such permission and approval has not been
+denied, (ii) in the opinion of our Hong Kong legal counsel, Cheung, Yeung & Lee, Solicitors, neither our Group nor our Hong Kong
+Operating Subsidiaries are required under any Hong Kong laws or legal requirements to obtain any permission or approval from Hong Kong
+authorities to issue our Ordinary Shares to foreign investors or listing on Nasdaq.
+
+ 
+
+ 
+ Hong
+ Kong Operating Subsidiaries 
+ 
+ Name
+ of Registration
+ 
+ Issuing
+ Authority 
+ 
+ Validity
+
+ 
+ MediaOn
+ Limited 
+ 
+ Business
+ registration certificate (58790075-000-07-25-5)
+ 
+ Inland
+ Revenue Department of Hong Kong
+ 
+ 27
+ July 2025 to 26 July 2026
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Mosaic
+ Creative Company Limited 
+ 
+ Business
+ registration certificate (76986830-000-08-25-8)
+ 
+ Inland
+ Revenue Department of Hong Kong
+ 
+ 27
+ August 2025 to 26 August 2026
+
+ 
+
+ 
+
+As of the date of this prospectus,
+in the opinion of our PRC legal counsel, The Alpha Law Firm, we are also not required to obtain permissions or approvals from any PRC
+authorities before listing in the United States and to issue our Ordinary Shares to foreign investors or listing on Nasdaq or operate
+our business as currently conducted, including the CSRC, the CAC, or any other governmental agency that is required to approve our operations,
+because (a) the CSRC currently has not issued any definitive rule or interpretation concerning whether offerings like ours under this
+prospectus are subject to the Trial Measures; (b) our Hong Kong Operating Subsidiaries were established and operated in Hong Kong and
+are not included in the categories of industries and companies whose foreign securities offerings are subject to review by the CSRC or
+the CAC; (c) our Hong Kong Operating Subsidiaries have not collected or stored any data (including certain personal information) from
+PRC individuals or organizations; (d) our Hong Kong Operating Subsidiaries are not an operator of key information infrastructure; (e)
+our Hong Kong Operating Subsidiaries do not possess personal information on more than one million users in our business operations; and
+(f) data processed in our business does not have a bearing on national security, economy operation, social stability or public health
+and security and thus may not be classified as core or important or significant data by the authorities, we would not be subject to review
+by the CAC.
+
+ 
+
+Hong Kong is a special administrative
+region of the PRC and the basic policies of the PRC regarding Hong Kong are reflected in the Basic Law, which serves as Hong Kong s
+constitution. The Basic Law provides Hong Kong with a high degree of autonomy and executive, legislative and independent judicial powers,
+including that of final adjudication under the principle of "one country, two systems" and a distinct set of laws and regulations.
+The PRC laws and regulations do not currently have any direct impact on our business, financial condition or results of operations. However,
+there is no assurance that there will not be any changes in the economic, political and legal environment in Hong Kong in the future.
+Due to long arm provisions under the current PRC laws and regulations, there remains regulatory uncertainty with respect to whether
+in the future we will be required to obtain approvals from the PRC authorities to operate our business or list on the U.S. exchanges
+and offer securities. In the event that (i) the PRC government exerts more oversight and control over offerings that are conducted
+overseas and/or foreign investments in China-based issuers and expands the categories of industries and companies whose foreign securities
+offerings are subject to review by the CSRC or the CAC and that we are required to obtain such permissions or approvals, (ii) we concluded
+that relevant permissions or approvals were not required but the PRC authorities take a contrary view or that we did not receive or maintain
+relevant permissions or approvals required, or (iii) applicable laws, regulations, or interpretations change and require us to obtain
+such permissions or approvals in the future, we may face regulatory risks as those operated in China, including the ability to offer
+securities to investors, list their securities on a U.S. or other foreign exchanges, conduct their business or accept foreign investment
+or sanctions by the CSRC, the CAC, or other PRC regulatory agencies. Failure to comply with laws and regulations applicable to our
+business could subject us to fines and penalties and could also cause us to lose customers or otherwise harm our business.
+
+ 
+
+These statements and regulatory
+actions are relatively new. It is highly uncertain how soon the existing or new laws or regulations or detailed implementations and interpretations
+may be modified or promulgated, if any, and therefore may have potential impact on our daily business operations, our abilities to accept
+foreign investments and the listing of our Ordinary Shares on U.S. or other foreign exchanges. The interpretation and enforcement of
+relevant PRC cybersecurity laws and regulations still need to be determined in accordance with the relevant laws and regulations in effect
+at that time. If the Trial Measures are amended in the future and becomes applicable to us, if our proposed listing on NASDAQ is deemed
+to be an overseas indirect issuance and listing or, if we are deemed to be an "Operator" that are required to file for cybersecurity
+review before listing in the United States. Moreover, if the Measures for Cybersecurity Review (2021) or the PRC Personal Information
+Protection Law becomes applicable to us, our operations and the listing of our Ordinary Shares in the United States could be subject
+to the CAC s cybersecurity review or CSRC Overseas Issuance and Listing review in the future. If we become subject to the CAC review,
+there is no assurance that we will be able to comply with the regulatory requirements in all respects and the current practice of collecting
+and processing personal information may be ordered to be rectified or terminated by regulatory authorities. The Company may be required
+to incur material costs and expenses in order to ensure compliance with the rules and regulations of the CAC or CSRC reviews. Due to
+long arm provisions under the current PRC laws and regulations or in the event of a failure to comply, our Company may become subject
+to fines and other penalties which may have a material adverse effect on our business, operations and financial condition or no longer
+be permitted to continue current business operations, and may hinder our ability or no longer be able to offer or continue to offer Ordinary
+Shares to investors and cause the value of our Ordinary Shares to significantly decline or be worthless or possibly delisting. 
+
+ 
+
+See "Risk Factors
+- If the PRC government chooses to exert more oversight and control over offerings that are conducted overseas and/or foreign investment
+in China-based issuers, and if we become subject to such oversight and control such action may significantly limit or completely hinder
+our ability to offer or continue to offer Ordinary Shares to investors and cause the value of our Ordinary Shares to significantly decline
+or be worthless on" on page 21 and "Risk Factors - We may become subject to a variety of PRC laws and other regulations regarding
+privacy, cybersecurity, data protection, data security or securities offerings that are conducted overseas and/or other foreign investment
+in China-based issuers. Any failure to comply with applicable laws and regulations could have a material and adverse effect on our business,
+financial condition and results of operations and may hinder our ability to offer or continue to offer Ordinary Shares to investors and
+cause the value of our Ordinary Shares to significantly decline or be worthless" on page 26.
+
+ 
+
+ 14
+
+ 
+
+ 
+
+ 
+
+The Offering
+
+ 
+
+ 
+ Offering Price
+ 
+ The initial public offering price will be between US$[4] and US$[6] per share.
+
+ 
+ 
+ 
+ 
+
+ 
+ Ordinary Shares offered by us
+ 
+ 2,000,000 Class A Ordinary Shares. 
+
+ 
+ 
+ 
+ 
+
+ 
+ Ordinary Shares offered by the Selling
+ Shareholders
+
+ 
+ 1,900,000
+ Class A Ordinary Shares
+
+ 
+ 
+ 
+ 
+
+ 
+ Ordinary Shares issued and outstanding prior to this offering
+ 
+ 3,500,000
+ Class A Ordinary Shares and 16,500,000 Class B Ordinary Shares.
+
+ 
+ 
+ 
+ 
+
+ 
+ Ordinary Shares to be issued and outstanding immediately after this offering
+ 
+ 5,500,000
+ Class A Ordinary Shares and 16,500,000 Class B Ordinary Shares, assuming the underwriter does not exercise its over-allotment
+ option, and 5,800,000 Class A Ordinary Shares and 16,500,000 Class B Ordinary Shares, assuming the underwriter fully
+ exercises its over-allotment option.
+
+ 
+ 
+ 
+ 
+
+ 
+ Use of proceeds
+ 
+ We currently intend to use the net proceeds from this
+ offering (i) approximately 25% for operation expenses; (ii) approximately 25% for marketing expenses; (iii) approximately 10% for
+ CAPEX; (iv) approximately 15% for repayment of certain loans; (v) approximately 2.0%, or $200,000 for escrow
+ with the underwriter for 12 months; and (vi) the remaining for general working capital and corporate purposes. See "Use
+ of Proceeds" on page 39.
+
+ 
+ 
+ 
+ 
+
+ 
+ Lock-up
+ 
+ We, each of our Directors and Executive Officers have agreed, subject to certain exceptions, for a period of 12 months after the date of this prospectus, not to, except in connection with this offering, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend or otherwise transfer or dispose of, directly or indirectly, any shares or any other securities convertible into or exercisable or exchangeable for shares, or enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of shares. Certain principal shareholders (5% or more) have agreed to a similar lock-up for a 6-month period from the date of this prospectus. See "shares Eligible for Future Sale" and "Underwriting—Lock-Up Agreements" on page 118.
+
+ 
+ 
+ 
+ 
+
+ 
+ Over-allotment option
+ 
+ We have granted to the underwriter a 45-day
+ option to purchase from us up to an additional 15% of the Ordinary Shares sold by us in this offering, solely to cover over-allotments,
+ if any, at the initial public offering price, less the underwriting discounts.
+
+ 
+ 
+ 
+ 
+
+ 
+ Risk factors
+ 
+ Investing in our shares involves risks. See "Risk Factors" beginning on page 16 of this prospectus for a discussion of factors you should carefully consider before deciding to invest in our Shares.
+
+ 
+ 
+ 
+ 
+
+ 
+ Listing
+ 
+ We plan to apply to list the Ordinary Shares on the Nasdaq. At this time, Nasdaq has not yet approved our application to list our Ordinary Shares. The closing of this offering is conditioned upon Nasdaq s final approval of our listing application, and there is no guarantee or assurance that our Ordinary Shares will be approved for listing on Nasdaq.
+
+ 
+ 
+ 
+ 
+
+ 
+ Proposed trading symbol
+ 
+ MEON
+
+ 
+ 
+ 
+ 
+
+ 
+ Transfer agent
+ 
+ VStock Transfer, LLC, 18 Lafayette Place, Woodmere,
+New York 11598; telephone: 212-828-8436, toll-free: 855-9VSTOCK.
+
+ 
+ 
+ 
+ 
+
+ 
+ Payment and settlement
+ 
+ The underwriter expects to deliver the shares against payment therefor through the facilities of the Depository Trust Company on [ ].
+
+ 
+ 
+
+ 15
+
+ 
+
+ 
+
+ 
+
+RISK FACTORS
+
+ 
+
+Investing in our shares is
+highly speculative and involves a significant degree of risk. You should carefully consider the following risks, as well as other information
+contained in this prospectus, before making an investment in our Company. The risks discussed below could materially and adversely affect
+our business, prospects, financial condition, results of operations, cash flows, ability to pay dividends and the trading price of our
+shares. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially and
+adversely affect our business, prospects, financial condition, results of operations, cash flows and ability to pay dividends, and you
+may lose all or part of your investment.
+
+ 
+
+This prospectus also contains
+forward-looking statements having direct and/or indirect implications on our future performance. Our actual results may differ materially
+from those anticipated by these forward-looking statements due to certain factors, including the risks and uncertainties faced by us,
+as described below and elsewhere in this prospectus.
+
+ 
+
+Risks Related to our Business and Industry
+
+ 
+
+Management has concluded that material uncertainties
+exist which may raise substantial doubt about its ability to continue as a going concern and the auditor of the Company has included
+an explanatory paragraph relating to its ability to continue as a going concern in its auditor s report for the years ended September
+30, 2024 and 2023.
+
+ 
+
+Management has concluded that material uncertainties
+exist which may raise substantial doubt about its ability to continue as a going concern and the auditor of the Company has included
+an explanatory paragraph relating to its ability to continue as a going concern in its auditor s report for the years ended September
+30, 2024 and 2023. During the years ended September 30, 2024 and 2023, the Company generated $2,804,375 and $3,966,115, respectively,
+in revenues, net loss of $165,103 and net income of $1,060,906, respectively, and cash flows (used in) operating activities
+of $960,540 and $118,582, respectively. As at September 30, 2024, the Company had an accumulated deficit of $1,958,442. The continued
+operations of the Company is dependent on the success of this offering, future profitable operations, management s ability to manage
+costs and the future availability of equity or debt financing. The above events and conditions indicate a material uncertainty that may
+cast significant doubt about the ability of the Company to continue as a going concern and the auditor of the Company has included an
+explanatory paragraph relating to its ability to continue as a going concern in its auditor s report for the years ended September
+30, 2024 and 2023. The financial statements included elsewhere in this filing, have been prepared on the basis that the Company will
+operate as a going concern, which contemplates the realization of assets and settlement of liabilities and commitments in the normal
+course of business. The financial statements do not include adjustments to amounts and classifications of assets and liabilities that
+might be necessary should the Company be unable to continue as a going concern. The financial statements of the Company do not include
+any adjustments that might result from the outcome of this uncertainty. In addition, the value of our Ordinary Shares issued in this
+Offering would be greatly impaired if we are unable to continue as a going concern. Our ability to continue as a going concern is dependent
+upon generating sufficient cash flow from operations and obtaining additional capital and financing, including funds to be raised in
+this offering. If our ability to generate cash flow from operations is reduced and we are unable to raise additional funding from other
+sources, we may be unable to continue in business even if this offering is successful. For further discussion about our ability to continue
+as a going concern and our plan for future liquidity, see "Management s Discussion and Analysis of Financial Condition and
+Results of Operations—Ability to Continue as a Going Concern."
+
+ 
+
+We are involved in the highly competitive advertising
+industry and may not be able to compete successfully with our competitors, which could reduce our market share and adversely affect our
+financial condition.
+
+ 
+
+We compete with other companies
+in providing advertising services to clients. The advertising industry in Hong Kong is rapidly evolving and extremely competitive, and
+competition for clients is expected to intensify in the future. Increased competition may lead to price reductions for advertising services,
+smaller profit margins, and erosion of our market share. If our existing or potential competitors develop or offer services that offer
+advantages over our Company in terms of effectiveness, price, creativity, or other qualities, then our business, results of operations,
+and financial conditions could be negatively affected. Our existing and potential competitors may possess additional competitive advantages
+over us, such as a longer operating history, greater name recognition, larger audience base, and greater financial, technical, and marketing
+resources. If we fail to compete successfully, we could lose our clients. Increased competition within our industry could result in pricing
+pressure and loss of our market share, which could have a material adverse effect on our results of operations and financial conditions.
+
+ 
+
+Cutbacks on advertising budgets by our clients
+and failure to maintain and grow our client base could materially and adversely affect our business and harm our financial condition.
+
+ 
+
+We derive our revenue by procuring
+clients to engage our services, which are usually determined by the advertising spend of our clients. Accordingly, our revenue base and
+our profitability reflect allocations in the advertising budgets of our clients. The willingness of clients to spend their advertising
+budget through us is critical to our business and our ability to generate revenue. Our clients demand for our services can be influenced
+by a variety of factors, including but not limited to: (i) macro-economic and social factors such as domestic, regional, and global social,
+economic, and political conditions, economic and geopolitical challenges, and economic, monetary, and fiscal policies; (ii) industry-related
+factors such as changing trends, preferences, and habits of audiences in regard to advertisements and their receptiveness to advertising
+as well as the development of emerging and varying forms of advertising content; (iii) client-specific factors such as an advertiser s
+specific development strategies, business performance, financial condition, and sales and marketing plans. Changes in any of the above
+factors may result in significant cutbacks in advertising budgets by our clients, which would reduce our revenue and profit. As a result,
+our business, results of operations, and financial condition could be materially and adversely affected.
+
+ 
+
+ 16
+
+ 
+
+ 
+
+ 
+
+Our limited operating history in a rapidly evolving
+industry makes it difficult to accurately forecast our future operating results and evaluate our business prospects.
+
+ 
+
+We began delivering services
+to clients in 2011. Our future performance may be susceptible to risks that differ from those encountered by a company with a longer
+operating history in a different industry. Many of the factors discussed in this section could adversely affect our business and prospects
+and future performance, including our ability to: (a) maintain, expand, and further develop our relationships with our clients to meet
+their increasing demands; (b) introduce and develop quality advertising services; (c) reflect the continued growth and development of
+the advertising industry in Hong Kong; (d) keep pace with technological developments in the rapidly evolving advertising industry; (e)
+attract and retain qualified and skilled employees; (f) effectively manage our business operations; and (g) compete effectively
+with our competitors in the advertising industry. We may not be successful in addressing the risks and uncertainties listed above, among
+others, which may materially and adversely affect our business, results of operations, financial condition, and future prospects.
+
+ 
+
+We may be unable to successfully implement or
+implement in full and effectively our future business plans and business strategies.
+
+ 
+
+Our success is dependent on, among
+other things, our proper and timely execution of our future business plans. It is our aim to solidify our market position in the advertising
+industry. As our operations grow in size, scope, and complexity, we will incur significant costs and allocate additional resources to
+strengthen and develop relationships with our existing and potential clients; expand our sales and marketing efforts; hire and retain
+experienced employees; enhance our technological infrastructure; stabilize our operational efficiency; and improve our financial systems
+and internal control. However, our returns on such investments may not be achieved for a few years, or possibly at all. Our current and
+future expansion plans will also require significant managerial attention and resources for us to flourish. Moreover, our future business
+plans may be hindered by factors beyond our control, such as competition within our industry, our ability to cope with financial risk,
+operational risk, and market risk as our business expands, and our ability to provide, maintain, and improve the level of human and other
+resources involved in serving our clients. As a result, we cannot be certain that our future business plans will materialize in accordance
+with our desired timetable, or at all, or that our objectives will be accomplished fully or partially, or that our business strategies
+will generate the intended benefits that we initially contemplated. If we fail to implement our expansion plans and business development
+strategies successfully, our business performance, financial condition, and future prospects and growth could be materially and adversely
+affected.
+
+ 
+
+Our operating results depend on our ability
+to respond quickly to changes in the marketing preferences of our clients.
+
+ 
+
+The advertising industry experiences
+rapid changes in client preferences and tastes. Given the subjective nature of the advertising business and rapid changes in marketing
+trends, there is no assurance that our services or creative content will continue to anticipate or respond quickly to the changing preferences
+of our clients. If we fail to adapt, our business, results of operations and financial condition could be materially affected. Furthermore,
+the advertising industry is characterized by rapidly evolving technologies. We rely on the Internet and social media platforms to disseminate
+advertisements. If there is a decline in the use of such platforms or a material change in viewer behaviors to which we are unable to
+adapt, we could lose our clients and our revenue could be adversely affected.
+
+ 
+
+Our business is highly sensitive to changing
+preferences of audiences.
+
+ 
+
+Our services focus on providing
+content that reflects market trends and the social environment. Therefore, demand for our services may be adversely affected by changes
+in the preferences of the ultimate audience for our advertisements and creative content. If viewer preferences change, our target audience
+may opt for advertisements and content from competing companies that are more responsive to trends. If our audience loses interest in
+the advertisements and content we create for our clients, then our business, results of operations, and financial conditions could be
+adversely affected.
+
+ 
+
+The advertising industry is subject to uncertainties
+that could affect our business and results of operations.
+
+ 
+
+The growth of the advertising
+industry in Hong Kong is subject to some uncertainties. Some of our existing or potential clients may not have previously devoted a significant
+portion of their budget to advertising and therefore may have a limited understanding of advertising. Our ability to generate and maintain
+certain levels of revenue will depend on a number of factors, many of which are beyond our control, including but not limited to: (a)
+the maintenance and enhancement of audience recognition of our clients products or services in a cost-effective manner; (b) intensifying
+competition in the advertising industry and potential downward pressure on advertising prices; (c) changes in governmental policy that
+would restrict and regulate advertising practices; and (d) the effectiveness of our marketing strategy and technology systems, any unfavorable
+change in which would affect adversely our business and results of operations.
+
+ 
+
+ 17
+
+ 
+
+ 
+
+ 
+
+If we fail to keep pace with rapidly changing
+technologies, we could lose our clients, and our business and results of operations could be adversely affected.
+
+ 
+
+As a provider of marketing services,
+we must keep pace with the changing technological expectations of our clients and the ultimate audience. Our clients may require us to
+use new technologies in the design, shooting, editing, and cutting of advertisements. We will need to quickly and cost-effectively adapt
+if our clients begin to shift to the use of new technologies, but we cannot assure you that we will be able to do so. We may not be able
+to respond quickly, or at all, to these changing technological preferences to ensure that our services will continue to be competitive.
+If we fail to implement such changes or fail to do so in a timely manner, we could lose our clients, and our business and results of operations
+could be adversely affected.
+
+ 
+
+Our reliance on third-party artificial intelligence (AI) tools
+may expose us to technological, operational, or legal risks beyond our control. 
+
+ 
+
+We utilize third-party AI
+platforms such as ChatGPT, Poe, Midjourney, and Zapier AI to support content creation, design, and automation. These AI tools are not
+developed by us and are subject to change, service disruption, licensing restrictions, or policy revisions by the technology providers.
+If such tools become unavailable, unaffordable, or materially restricted in functionality, our ability to deliver AI-enhanced services
+may be limited, which could adversely affect our competitiveness and client satisfaction. In addition, changes in regulatory frameworks
+around AI use (e.g., data privacy, copyright) could impose compliance burdens or legal liability that impact our cost structure or operations.
+
+ 
+
+Our services are generally project-based, and
+we generally do not enter into long-term agreements with our clients. If we fail to retain existing clients or attract new clients, our
+results of operations could be materially affected.
+
+ 
+
+Our business model is mostly
+project-based, so our revenue tends to be non-recurring. Since we generally do not enter into long-term agreements with our clients,
+our success depends on our ability to maintain our relationships with existing clients and to develop new opportunities with potential
+clients. Because our contracts with clients are generally entered into on a project basis, our revenue may fluctuate depending on the
+number of advertising projects we are able to secure, and therefore we may have limited ability to forecast our future revenue streams.
+We cannot assure you that our clients will continue to procure our services or that we will be able to replace, in a timely or effective
+manner, departing clients with potential clients that deliver comparable levels of revenue. If we fail to retain our existing clients
+or to increase advertisers utilization of our services or provide innovative services and pricing structures that attract new
+clients, the demand for our services will not grow and may even decrease, which could materially and adversely affect our ability to
+maintain or increase our revenue. In addition, we cannot assure that we will be able to grow our revenue and profits in
+the future, as it is highly dependent on our ability to attract clients to utilize our services while also holding down our costs of
+operations. Our operations and financial results could be adversely affected if we are not able to secure a sufficient number of new
+advertising projects.
+
+ 
+
+We derive a significant
+portion of our revenue from a limited number of customers, and the loss of or a material reduction in business from one or more of these
+customers could adversely affect our business, results of operations, and financial condition.
+
+ 
+
+In fiscal 2024, two customers
+accounted for approximately 62.61% of our total revenues. Our relationships with such customers are based on ongoing commercial engagement rather than exclusive long-term
+contracts. If either of these customers were to reduce their spendings, terminate their business with us, or experience financial difficulties,
+our business could be materially and adversely affected. Our ability to attract new large clients or to further diversify our customer
+base may be limited by competition or changing market conditions.
+
+ 
+
+If we are unable to secure engagements from
+our clients, our business and financial performance may be adversely affected.
+
+ 
+
+There is no guarantee that we
+will be able to continuously secure engagements with our clients. In the event that we are unable to maintain business relationships with
+our existing clients or to secure business opportunities from new clients, our results of operations may be adversely affected. Our ability
+to secure large-scale and/or high-profile projects could be materially and adversely impacted, thereby affecting our business, financial
+performance, and results of operations.
+
+ 
+
+If we fail to achieve the marketing objectives
+of our clients, we could lose our clients and our revenue could decline.
+
+ 
+
+We offer services to serve the
+advertising objectives of our clients. We are expected to provide effective services that can achieve the desired advertising objectives
+of our clients, such as reaching a specific number of visitors within a given timeframe. To attract the target audience, we keep ourselves
+abreast of constantly changing audience preferences. If our services are not able to achieve the desired advertising objectives, our relationships
+with our clients and our reputation and revenue will be adversely affected. In addition, we may not be able to grow our
+business effectively and in a controlled manner. Over-expansion of services may strain our limited managerial, operational, and financial
+resources, which may have a material adverse impact on the stability of our operation and financial conditions.
+
+ 
+
+ 18
+
+ 
+
+ 
+
+ 
+
+The marketing industry is highly schedule driven,
+and our failure to meet the schedule requirements of our clients could adversely affect our reputation and/or expose us to financial liability.
+
+ 
+
+In some instances, we guarantee
+that we will complete a campaign by a certain date. Any failure to meet the contractual schedule or completion requirements set forth
+in our contracts with our clients could subject us to responsibility for costs resulting from the delay, generally in the form of contractually
+agreed-upon liquidated damages and liability for our clients actual costs arising out of our delay. Negative consequences of our
+failure to meet a contractual schedule could include reduced profits or a loss on that project, damage to our reputation, and a material
+adverse impact on our financial position, results of operations, cash flows and liquidity.
+
+ 
+
+The quality of work performed by our independent
+suppliers may affect our sales and damage our reputation.
+
+ 
+
+We may engage third-party suppliers
+to assist in producing content for some of our advertising projects, including photo and video shooting and subsequent video editing.
+Our execution team conducts reviews and collects feedback from our clients to assess the quality of work performed by these suppliers.
+However, the provision of these services could be interrupted by unforeseen events beyond our control, such as natural disasters, social
+unrest, and labor strikes. We cannot assure you that there will be no delays in the dissemination of our advertisements as a result of
+material disruptions in the operations of third-party suppliers. If there is any delay in dissemination, it may cause damage to our brand
+and we may not be able to publish our clients advertisements in time. This would materially affect our relationships with our clients
+and our business operations. Occurrence of any such events could materially and adversely affect our reputation, business, financial conditions,
+and results of operations.
+
+ 
+
+If we experience information and technological
+system failures, our business operations could be significantly disrupted.
+
+ 
+
+The business operations and success
+of our services depend on the stable performance of the information and technological systems that we utilize to perform functions such
+as the following: communicate with suppliers and clients; design, execute, and place advertisements; monitor the performance of our advertising
+results; and monitor the sufficiency of our advertising platform. Any system failure that affects our ability to provide services to clients
+could significantly reduce the attractiveness of our services to clients and hence reduce our revenue. Our systems are vulnerable to a
+variety of events, including, among others, telecommunications failures, power shortages, malicious human acts, and natural disasters.
+In addition, any steps to increase reliability and avoid the redundancy of our information and technological systems may not be effective
+and may be unsuccessful in preventing system failures.
+
+ 
+
+Seasonality in our services may affect our business
+and operating results.
+
+ 
+
+Our revenue from services is subject
+to seasonal fluctuations. We record higher revenue in the fourth quarter of each year. We believe our clients tend to allocate a larger
+portion of their marketing budget during this period, which may coincide with increased consumer purchases at that time. We may not be
+able to satisfy the high demand of service engagement received from our clients during the peak season, and this may result in loss of
+business opportunities or delays in completion of our services for our clients. In the event that we fail to meet the high demand for
+service engagement at any time, our business, financial condition, and results of operations may be adversely affected.
+
+ 
+
+We may not be able to execute our strategies
+effectively, which may materially and adversely affect our business and prospects.
+
+ 
+
+To continue to expand our business,
+increase our market share, and accomplish our business objectives, we plan to implement a number of strategies. Implementation of these
+strategies will require significant managerial, financial, and human resources. However, we cannot assure you that we will be able to
+deploy all of the managerial, financial, and human resources required to execute our strategies for business optimization and expansion
+successfully, nor that our net proceeds from the Offering will allow us to implement all of these strategies. If we are not able to execute
+our business strategies effectively, or at all, our business, financial condition, and results of operations may be adversely affected.
+
+ 
+
+ 19
+
+ 
+
+ 
+
+ 
+
+We may not have adequate insurance coverage
+to cover our potential losses and claims in connection with our business.
+
+ 
+
+To the best of our knowledge,
+certain risks associated with the operation of our business cannot be fully covered by insurance. We have been maintaining statutory employees 
+compensation for our operations in Hong Kong, which we believe is in line with the industry practice in Hong Kong. As such, we cannot
+assure you that our insurance coverage is sufficient to cover all of our potential losses, and we may be exposed to liability in excess
+of our insurance coverage. For example, the occurrence of certain incidents such as business interruptions, labor disputes, and acts of
+God, and the consequences resulting from them, may not be adequately covered by our insurance policies, if at all. We also cannot guarantee
+that we will be able to maintain or renew our existing insurance coverage on commercially reasonable terms. In the event that we are subject
+to substantial claims, losses, or liabilities that are not covered by our insurance, we may incur expenses that could materially and adversely
+affect our financial condition and results of operations.
+
+ 
+
+Our business, financial conditions, and
+results of operations could be affected if we fail to attract and retain our key personnel, management team, and our employees.
+
+ 
+
+Our operations and future
+success of our business depends on our ability to attract and retain our key personnel, management team, and employees. As such, it is
+important for us to continue to attract and motivate a sufficient number of key personnel to maintain our financial condition and results
+of operations. We cannot assure you that there will be no departures of our key personnel. If one or more of our key personnel are unwilling
+to continue in their present position(s) in our Company, we may not be able to replace them instantly or at all. We may also need to
+offer higher compensation and other benefits in order to attract and recruit new personnel and may also incur additional expenses in
+the training of new personnel. If any of our key personnel joins a competing company or form a competing business, we may lose business
+secrets, technological know-how, and business relationships. This would subsequently disrupt our business and would have a material adverse
+impact on our business, financial condition, and results of operations.
+
+ 
+
+Our
+outstanding debt agreements may limit our flexibility in operating and expanding our business.
+
+ 
+
+As of
+September 30, 2024, we had bank borrowings and loans from related parties totalled approximately $1,228,000 and approximately $1,557,000,
+respectively. The Company may be exposed to cash flow interest rate risk through the changes in interest rates related mainly to the
+Company s bank borrowings and bank balances. The Company currently does not have any interest rate hedging policy in relation to
+fair value interest rate risk and cash flow interest rate risk. As of September 30, 2024 and 2023, the Company s bank borrowings
+contain a repayment on demand clause that provides the bank with an unconditional right to demand repayment at any time at its own discretion.
+In the event the lenders would demand repayment of the Company s bank borrowings, it may have a material adverse effect upon our
+financial condition, our results of operations and an investment in our Ordinary Shares. Furthermore, the potential restrictive covenants
+to be contained in our existing and future loan agreements may restrict our access to future debt financing, on which our business operations
+depend. If our revenues decrease materially or we experience a significant increase in our interest expenses, we may not have enough
+available cash or be able to raise additional funds on satisfactory terms, if at all, through equity or debt financings to make any required
+prepayment or repay such indebtedness at the time any such event of default occurs. In such an event, we may be required to delay, limit,
+reduce or terminate our business development or expansion efforts. Our business, financial condition and results
+of operations could be materially adversely affected as a result.
+
+ 
+
+Our
+principal shareholders have substantial influence over our company and their interests may not be aligned with the interests of our other
+shareholders
+
+ 
+
+Upon
+completion of this offering, the largest shareholder of our company, Tech Vision Investments Limited, controlled by Jimmy Shu Wai Chan
+as the owner of 16,500,000 Class B Ordinary Shares, will beneficially own 98.36% of the total aggregate voting power, assuming that the
+underwriters do not exercise their over-allotment option. Jimmy Shu Wai Chan will be able to exert significant voting influence over
+our business, including decisions regarding mergers, consolidations and the sale of all or substantially all of our assets, election
+of directors and other significant corporate actions. These actions may be taken even if they are opposed by our other shareholders,
+including those who purchased Class A Ordinary Shares in our initial public offering. Moreover, this concentration of ownership
+may discourage, delay or prevent a change in control of our Company, which could deprive our shareholders of an opportunity to receive
+a premium for their shares as part of a sale of our Company and might reduce the price of our Class A Ordinary Shares.
+
+ 
+
+Risks
+Relating to Doing Business in Hong Kong
+
+ 
+
+A downturn in the Hong Kong or global economy
+could materially and adversely affect our Hong Kong Operating Subsidiaries business and financial condition.
+
+ 
+
+Our Hong Kong Operating Subsidiaries 
+business, prospects, financial condition and results of operations may be influenced to a significant degree by political, economic and
+social conditions in Hong Kong and China generally. While the Chinese economy has experienced significant growth over the past decades,
+growth has been uneven, both geographically and among various sectors of the economy. The PRC government has implemented various measures
+to encourage economic growth and guide the allocation of resources which may affect our Hong Kong Operating Subsidiaries.
+
+ 
+
+Economic conditions in Hong Kong
+and China are sensitive to global economic conditions. Any prolonged slowdown in the global economy may affect our customers and have
+a negative impact on our business, results of operations and financial condition. Additionally, continued turbulence in the international
+markets may adversely affect our ability to access the capital markets to meet liquidity needs.
+
+ 
+
+Substantially all of our operations are in
+Hong Kong. However, the current PRC laws and regulations may influence our operations, which could result in a material change in our
+operations and/or the value of our Ordinary Shares. Changes in the policies, regulations, rules, and the enforcement of laws of the
+PRC government may also occur quickly with little advance notice and our assertions and beliefs of the risk imposed by the PRC legal
+and regulatory system cannot be certain.
+
+ 
+
+Our operations are primarily located
+in Hong Kong. As of the date of this prospectus, we do not expect to be materially affected by recent statements by the PRC authorities
+indicating an intent to exert more oversight over the securities offerings that are conducted overseas and/or foreign investment in China-based
+issuers. The policies, regulations, rules, and the enforcement of laws to which we are subject may change. The compliance of such new
+laws or regulations or any associated inquiries or investigations may:
+
+ 
+
+ 
+ 
+ 
+ delay or impede our development;
+
+ 
+ 
+
+ 
+ 
+ 
+ result in negative publicity or increase our operating costs;
+
+ 
+ 
+
+ 20
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ require significant management time and attention; and/or
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ subject us to remedies, administrative penalties and even criminal liabilities that may harm our business, including fines assessed for our current or historical operations, or demands or orders that we modify or even cease our business practices.
+
+ 
+ 
+
+The PRC authorities initiated
+a series of regulatory actions and statements to regulate business operations in certain areas in China, including cracking down on illegal
+activities in the securities market, enhancing supervision over China-based companies listed overseas using a VIE structure, adopting
+new measures to extend the scope of cybersecurity reviews, and expanding the efforts in anti-monopoly enforcement. These regulatory actions
+and statements emphasize the need to strengthen the administration over illegal securities activities and the supervision of China-based
+companies seeking overseas listings. Additionally, companies are required to undergo a cybersecurity review if they hold large amounts
+of data related to issues of national security, economic development or public interest before carrying our mergers, restructuring or
+splits that affect or may affect national security. These statements were recently issued and their official guidance and interpretation
+still need to be determined in accordance with the relevant laws and regulations in effect at that time. While we believe that our Hong
+Kong Operating Subsidiaries operations are not currently being affected, they may be subject to additional and stricter compliance
+requirements in the near term. Compliance with new regulatory requirements or any future implementation rules may present a range of new
+challenges which may create uncertainties and increase our Hong Kong Operating Subsidiaries cost of operations.
+
+ 
+
+The PRC government may exert
+more supervision over offerings conducted overseas and foreign investment in China-based issuers, which may result in a material change
+in the value of our Ordinary Shares. The promulgation of new laws or regulations, or the new interpretation of existing laws and regulations,
+in each case, that restrict or otherwise unfavorably impact the ability or way we conduct our business, could require us to change certain
+aspects of our business to ensure compliance, which could decrease demand for our products, reduce revenues, increase costs, require
+us to obtain more licenses, permits, approvals or certificates, or subject us to additional liabilities. To the extent any new or more
+stringent measures are required to be implemented, our business, financial condition and results of operations could be adversely affected
+and such measures could materially decrease the value of our Ordinary Shares, potentially rendering it worthless. 
+
+ 
+
+The PRC government may intervene or influence
+our operations at any time, which could result in a material change in our operations and/or the value of our Ordinary Shares.
+
+ 
+
+The PRC government may exercise
+significant oversight and discretion over the conduct of our business and may intervene in or influence our operations at any time, which
+could result in a material change in our operations and/or the value of our Ordinary Shares. The enforcement of laws and that rules and
+regulations in China can change quickly with little advance notice. The PRC government may intervene or influence our Hong Kong Operating
+Subsidiaries operations at any time, or may exert more control over securities offerings conducted overseas and/or foreign investment
+in Hong Kong-based issuers, which could result in a material change in our Hong Kong Operating Subsidiaries operations and/or the
+value of our Ordinary Shares.
+
+ 
+
+If the PRC government chooses to exert more
+oversight and control over offerings that are conducted overseas and/or foreign investment in China-based issuers, and if we become subject
+to such oversight and control such action may significantly limit or completely hinder our ability to offer or continue to offer Ordinary
+Shares to investors and cause the value of our Ordinary Shares to significantly decline or be worthless.
+
+ 
+
+Recent statements by the PRC government
+have indicated an intent to exert more oversight and control over offerings that are conducted overseas and/or foreign investments in
+China-based issuers. On December 28, 2021, the CAC jointly with the relevant authorities formally published Measures for Cybersecurity
+Review (2021) which took effect on February 15, 2022 and replaced the former Measures for Cybersecurity Review (2020) issued on April
+13, 2020. Measures for Cybersecurity Review (2021) stipulate that operators of critical information infrastructure purchasing network
+products and services, and online platform operator carrying out data processing activities that affect or may affect national security,
+shall conduct a cybersecurity review, and any online platform operator who controls more than one million users personal information
+must go through a cybersecurity review by the cybersecurity review office if it seeks to be listed in a foreign country. We currently
+do not control over one million users personal information and do not collect data that affects or may affect national security.
+
+ 
+
+ 21
+
+ 
+
+ 
+
+ 
+
+On February 17, 2023, with the
+approval of the State Council, the CSRC promulgated the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic
+Companies (the "Trial Measures"), and five supporting guidelines, which came into effect on March 31, 2023. Pursuant to the
+Trial Measures, (i) domestic companies that seek to offer or list securities overseas, both directly and indirectly, shall complete filing
+procedures with the CSRC pursuant to the requirements of the Trial Measures within three working days following their submission of initial
+public offerings or listing applications. If a domestic company fails to complete the required filing procedures or conceals any material
+fact or falsifies any major content in its filing documents, such domestic company may be subject to administrative penalties, such as
+an order to rectify, warnings and fines, and the controlling shareholders or actual controllers which organize or instigate the prescribed
+illegal acts or conceal relevant matters and cause the prescribed circumstances shall be subject to fines, and the person directly in
+charge and other directly liable persons may also be subject to administrative penalties, such as warnings and fines; (ii) if the issuer
+meets both of the following criteria, the overseas offering and listing conducted by such issuer shall be deemed an indirect overseas
+offering and listing by a PRC domestic company: (A) 50% or more of any of the issuer s operating revenue, total profit, total assets
+or net assets as documented in its audited consolidated financial statements for the most recent fiscal year were derived from PRC domestic
+companies; and (B) the majority of the issuer s business activities are carried out in China, or its main place(s) of business are
+located in China, or the majority of its senior management team in charge of its business operations and management are PRC citizens or
+have their usual place(s) of residence located in China. In such circumstances, the issuer shall designate a major domestic operating
+entity responsible for all filing procedures with the CSRC, and shall submit filings with the CSRC within three business days after an
+application for an initial public offering or listing in an overseas market is submitted.
+
+ 
+
+As of the date of this prospectus,
+in the opinion of our PRC legal counsel, The Alpha Law Firm, this offering is not subject to the review or prior approval of the CAC nor
+the CSRC. We do not intend to seek approval of this offering from the CAC or the CSRC. Uncertainties still exist, however, due to the
+possibility that laws, regulations, or policies in the PRC could change in the future. It is uncertain whether the PRC authorities will
+adopt additional requirements or extend the existing requirements to apply to our Hong Kong Operating Subsidiaries. Any future action
+by the PRC government expanding the categories of industries and companies whose foreign securities offerings are subject to review by
+the CSRC or the CAC could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and
+could cause the value of such securities to significantly decline or be worthless.
+
+ 
+
+In the event that (i) the PRC
+government exerts more oversight and control over offerings that are conducted overseas and/or foreign investments in China-based issuers
+and expands the categories of industries and companies whose foreign securities offerings are subject to review by the CSRC or the CAC
+such that we are required to obtain such permissions or approvals; or (ii) we concluded that relevant permissions or approvals were not
+required but the PRC authorities take a contrary view or that we did not receive or maintain relevant permissions or approvals required,
+any action taken by the PRC authorities could significantly limit or completely hinder our operations, significantly limit or completely
+hinder our ability to offer our Ordinary Shares to investors, and cause the value of such Shares to significantly decline or become worthless.
+
+ 
+
+Although we are based in Hong Kong, if we should
+become subject to the recent scrutiny, criticism and negative publicity involving U.S.-listed China-based companies, we may have to expend
+significant resources to investigate and/or defend the allegations, which could harm our Hong Kong Operating Subsidiaries business
+operations, this offering and our reputation, and could result in a loss of your investment in our Ordinary Shares if such allegations
+cannot be addressed and resolved favorably.
+
+ 
+
+During the last several years,
+U.S. listed public companies that have substantially all of their operations in China have been the subject of intense scrutiny by investors,
+financial commentators and regulatory agencies. Much of the scrutiny has centered on financial and accounting irregularities and mistakes,
+lack of effective internal controls over financial reporting and, in many cases, allegations of fraud. As a result of this scrutiny, the
+publicly traded stock of many U.S.-listed Chinese companies that have been the subject of such scrutiny has sharply decreased in value.
+Many of these companies are now subject to shareholder lawsuits and/or SEC enforcement actions that are conducting internal and/or external
+investigations into the allegations.
+
+ 
+
+Although we are based in Hong
+Kong, if we become the subject of any such scrutiny, whether any allegations are true or not, we may have to expend significant resources
+to investigate such allegations and/or defend the Company. Such investigations or allegations would be costly and time-consuming and likely
+would distract our management from our normal business and could result in our reputation being harmed. The price of our Ordinary Shares
+could decline because of such allegations, even if the allegations are false.
+
+ 
+
+ 22
+
+ 
+
+ 
+
+ 
+
+There are political risks associated with conducting
+business in Hong Kong.
+
+ 
+
+Any adverse economic, social and/or
+political conditions, material social unrest, strike, riot, civil disturbance or disobedience, as well as significant natural disasters,
+may affect the market and adversely affect the business operations of the Company. Hong Kong is a special administrative region of the
+PRC and the basic policies of the PRC regarding Hong Kong are reflected in the Basic Law, Hong Kong s constitutional document, which
+provides Hong Kong with a high degree of autonomy and executive, legislative and independent judicial powers, including that of final
+adjudication under the principle of "one country, two systems." However, there is no assurance that there will not be any
+changes in the economic, political and legal environment in Hong Kong in the future. Since our operations are located
+in Hong Kong, any change of such political arrangements may pose immediate threat to the stability of the economy in Hong Kong, thereby
+directly and adversely affecting our results of operations and financial positions.
+
+ 
+
+Under the Basic Law, Hong Kong
+is exclusively in charge of its internal affairs and external relations, while the government of the PRC is responsible for its foreign
+affairs and defence. As a separate customs territory, Hong Kong maintains and develops relations with foreign states and regions. Based
+on certain recent developments, including the Law of the PRC on Safeguarding National Security in Hong Kong issued by the Standing Committee
+of the PRC National People s Congress in June 2020, the U.S. State Department has indicated that the United States no longer considers
+Hong Kong to have significant autonomy from China and at the time President Trump signed an executive order and Hong Kong Autonomy Act
+(the "HKAA"), to remove Hong Kong s preferential trade status and to authorize the U.S. administration to impose blocking
+sanctions against individuals and entities who are determined to have materially contributed to the erosion of Hong Kong s autonomy.
+The United States may impose the same tariffs and other trade restrictions on exports from Hong Kong that it places on goods from China.
+These and other recent actions may represent an escalation in political and trade tensions involving the U.S., China and Hong Kong, which
+could potentially harm our business.
+
+ 
+
+Given the relatively small geographical
+size of Hong Kong, any of such incidents may have a widespread effect on our Hong Kong Operating Subsidiaries business operations,
+which could in turn adversely and materially affect our business, results of operations and financial condition. It is difficult to predict
+the full impact of the HKAA on Hong Kong and companies with operations in Hong Kong like us.
+
+ 
+
+The PRC laws, rules and regulations that apply
+or are to be applied to Hong Kong, and the enforcement of the same, can change quickly with little or no advance notice. As a result,
+the Hong Kong legal system embodies uncertainties which could limit the availability of legal protections, which could result in a material
+change in our Hong Kong Operating Subsidiaries operations and/or the value of the securities we are registering for sale.
+
+ 
+
+The Basic Law was officially adopted
+at the Third Session of the Seventh National People s Congress on April 4, 1990 in accordance with the Sino-British Joint Declaration
+on the Question of Hong Kong entered into between the PRC and United Kingdom governments on December 19, 1984 and has been in effect since
+July 1, 1997. The Basic Law embodies the "One Country, Two Systems" principle and provides that Hong Kong will retain
+its own currency (i.e., the Hong Kong dollar), legal system, and people s rights and freedom, as well as the freedom to function
+with a high degree of autonomy, and the capitalism system and way of life in Hong Kong shall remain unchanged for fifty years from
+1997. Hong Kong is responsible for its own domestic affairs in various aspects including, but not limited to, exercise of independent
+judicial power (including that of final adjudication), conducting of administrative affairs, public finance, monetary affairs, immigration
+and customs, maintenance of public order, to the extent provided in the Basic Law.
+
+ 
+
+However, if the PRC attempts to
+divert from the principles set out in the Basic Law in relation to the autonomy currently enjoyed in Hong Kong, for example, through introducing
+PRC laws, rules and regulations that apply or are to be applied to Hong Kong with little or no advance notice, this could potentially
+impact Hong Kong s common law legal system and may in turn bring about uncertainty in, for example, the enforcement of the contractual
+rights of our Hong Kong Operating Subsidiaries. This could, in turn, materially and adversely affect our Hong Kong Operating Subsidiaries.
+Accordingly, we cannot predict the effect of future developments in the Hong Kong legal system, including the promulgation of new laws,
+changes to existing laws or the interpretation or enforcement thereof, or the pre-emption of local regulations by national laws. These
+uncertainties could limit the legal protections available to us, including the ability to enforce contractual rights of our Hong Kong
+Operating Subsidiaries, resulting in a material change in our Hong Kong Operating Subsidiaries operations and/or the value of the
+securities we are registering for sale.
+
+ 
+
+ 23
+
+ 
+
+ 
+
+ 
+
+Changes in international trade policies, trade
+disputes, barriers to trade or the emergence of a trade war may have a material and adverse effect upon us.
+
+ 
+
+Political events, international
+trade disputes and other business interruptions could harm or disrupt international commerce and the global economy and could have a
+material adverse effect on our customers and our operations. International trade disputes could result in tariffs and other protectionist
+measures, which may impact the business and spending habits of our customers and may materially and adversely affect our business.
+
+ 
+
+Political uncertainty, such as
+the recent invasion by Russia in Ukraine, and surrounding international trade disputes and their potential of escalation to trade wars
+and global recession, could have a negative effect on customer confidence, which could materially and adversely affect our Hong Kong Operating
+Subsidiaries business. In addition, the sanctions imposed by the United States and other countries on Russia, and that affect trade
+relations may cause global economic turmoil and potentially have a negative impact on our customers and their spending habits. We cannot
+provide any assurances as to whether such actions will occur or the form that they may take and the impact, if any, it may have on our
+operations.
+
+ 
+
+The Company may rely on dividends and other
+distributions on equity paid by the Hong Kong Operating Subsidiaries to fund any cash and financing requirements it may have, and any
+limitations or restrictions, prohibitions or limitations on the ability of the Company or our Hong Kong Operating Subsidiaries by the
+PRC government to transfer cash or assets in or out of Hong Kong may result in these funds or assets not being available to fund operations
+or for other uses outside of Hong Kong, which on the ability of the Hong Kong Operating Subsidiaries to make payments to the Company could
+have a material and adverse effect on the business.
+
+ 
+
+Within our structure, funds from
+foreign investors can be directly transferred to our Hong Kong Operating Subsidiaries by way of capital injection or in the form of a
+shareholder loan from the Company following this offering. As a holding company, we may rely on dividends and other distributions on equity
+paid by our Operating Subsidiaries for our cash and financing requirements. We are permitted under the laws of the Cayman Islands and
+our Amended and Restated Memorandum and Articles of Association to provide funding to our Operating Subsidiaries through loans and/or
+capital contributions. Our Hong Kong Operating Subsidiaries are permitted under the laws of Hong Kong to issue cash dividends to us without
+limitation on the size of such dividends. However, if our Hong Kong Operating Subsidiaries incur debt on their own behalf, the instruments
+governing such debt may restrict its ability to pay dividends. We do not maintain cash management policies or procedures with respect
+to the size or means of such transfers. There is no assurance that the flow of cash in or out of Hong Kong would not be restricted or
+prohibited. To the extent the Company s cash or assets in the business is in Hong Kong or a Hong Kong entity, the Company s
+funds or assets may, in the future, not be available to fund operations or for other use outside of Hong Kong due to interventions in
+or the imposition of restrictions and limitations on the ability of the Company and our Hong Kong Operating Subsidiaries by the PRC government
+to transfer cash or assets. Any limitation on the ability of the Hong Kong Operating Subsidiaries to distribute dividends or other payments
+to the Company could materially and adversely limit the ability to grow, make investments or acquisitions that could be beneficial to
+the businesses, pay dividends or otherwise fund and conduct the business.
+
+ 
+
+The PCAOB Determinations provides that if the
+PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in China or Hong Kong, a Special
+Administrative Region and dependency of the PRC, because of a position taken by one or more authorities in China or Hong Kong, it could
+result in the prohibition of trading in our securities by not being allowed to list on a U.S. exchange, and as a result an exchange may
+determine to delist our securities, which would materially affect the interest of our investors.
+
+ 
+
+The HFCA Act, which was enacted
+on December 18, 2020, states that if the SEC determines that a company has filed audit reports issued by a registered public accounting
+firm that has not been subject to inspection by the PCAOB for three consecutive years beginning in 2021, the SEC shall prohibit the company s
+shares from being traded on a national securities exchange or in the over-the-counter trading market in the United States.
+
+ 
+
+On March 24, 2021, the SEC adopted
+interim final rules relating to the implementation of certain disclosure and documentation requirements of the HFCA Act. A company will
+be required to comply with these rules if the SEC identifies it as having a "non-inspection" year under a process to be subsequently
+established by the SEC. The SEC is assessing how to implement other requirements of the HFCA Act, including the listing and trading prohibition
+requirements described above.
+
+ 
+
+ 24
+
+ 
+
+ 
+
+ 
+
+On December 23, 2022, the Accelerating
+HFCA Act (the "Accelerating HFCA Act") was signed into law, which amended the HFCA Act by requiring the SEC to prohibit an
+issuer s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive
+years instead of three. On December 29, 2022, the Consolidated Appropriations Act was signed into law by President Biden. The Consolidated
+Appropriations Act contained, among other things, an identical provision to the Accelerating HFCA Act, which reduces the number of consecutive
+non-inspection years required for triggering the prohibitions under the HFCA Act from three years to two. In the event our auditor is
+not subject to PCAOB inspections for two consecutive years, our Ordinary Shares may be prohibited from trading or delisted from an exchange.
+
+ 
+
+On November 5, 2021, the SEC approved
+the PCAOB s Rule 6100, Board Determinations Under the HFCA Act, Rule 6100 provides a framework for the PCAOB to use when determining,
+as contemplated under the HFCA Act, whether it is unable to inspect or investigate completely registered public accounting firms located
+in a foreign jurisdiction because of a position taken by one or more authorities in that jurisdiction.
+
+ 
+
+On December 2, 2021, the SEC issued
+amendments to finalize rules implementing the submission and disclosure requirements in the HFCA Act. The rules apply to registrants that
+the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located
+in a foreign jurisdiction and that the PCAOB is unable to inspect or investigate completely because of a position taken by an authority
+in foreign jurisdictions.
+
+ 
+
+On December 16, 2021, the PCAOB
+announced the PCAOB Determinations relating to the PCAOB s inability to inspect or investigate completely registered public accounting
+firms headquartered in China or Hong Kong, a Special Administrative Region and dependency of the PRC, because of a position taken by one
+or more authorities in the PRC or Hong Kong. The PCAOB Determinations provide that if the PCAOB is unable to inspect or investigate completely
+registered public accounting firms headquartered in China or Hong Kong, a Special Administrative Region and dependency of the PRC, because
+of a position taken by one or more authorities in China or Hong Kong, it could result in the prohibition of trading in our securities
+by not being allowed to list on a U.S. exchange, and as a result an exchange may determine to delist our securities, which would materially
+affect the interest of our investors.
+
+ 
+
+Our auditor, TAAD LLP, the independent
+registered public accounting firm that issued the audit report included in this prospectus, is registered with the PCAOB and subject
+to inspections by the PCAOB on a regular basis with the last inspection in April 2024. TAAD LLP s office is located in California.
+Therefore, we believe that, as of the date of this prospectus, our auditor is not subject to the PCAOB Determinations relating to the
+PCAOB s inability to inspect or investigate completely registered public accounting firms headquartered in the PRC or Hong Kong
+because of a position taken by one or more authorities in the PRC or Hong Kong. However, to the extent that our auditor s work
+papers may, in the future, become located in China, such work papers will not be subject to inspection by the PCAOB because the PCAOB
+is currently unable to conduct inspections without the approval of the Chinese authorities. Inspections of certain other firms that the
+PCAOB has conducted outside of China have identified deficiencies in those firms audit procedures and quality control procedures,
+which may be addressed as part of the inspection process to improve future audit quality. The inability of the PCAOB to conduct inspections
+of our auditors work papers in China would make it more difficult to evaluate the effectiveness of our auditor s audit procedures
+or quality control procedures as compared to auditors outside of China that are subject to PCAOB inspections. As a result, our investors
+may be deprived of the benefits of the PCAOB s oversight of our auditor through such inspections and they may lose confidence in
+our reported financial information and procedures and the quality of our financial statements. We cannot assure you whether Nasdaq or
+other regulatory authorities will apply additional or more stringent criteria to us. Such uncertainty could cause the market price of
+our Ordinary Shares to be materially and adversely affected.
+
+ 
+
+We will be required to comply
+with these rules if the SEC identifies us as having a "non-inspection" year under a process to be subsequently established
+by the SEC. The SEC is assessing how to implement other requirements of the HFCA Act, including the listing and trading prohibition requirements
+described above. Further, the United States Senate passed the Accelerated Holding Foreign Companies Accountable Act, which, if enacted,
+would amend the HFCA Act to require the SEC to prohibit an issuer s securities from trading on any U.S. stock exchange if its auditor
+is not subject to PCAOB inspections for two consecutive years instead of three.
+
+ 
+
+During the prior fiscal years
+ended September 30, 2024 and 2023, including through the date of this prospectus, our auditor does not have any documentation related
+to their audit reports located in China. However, to the extent that our independent registered public accounting firm s audit documentation
+related to their audit reports for the Company may be located in China, the PCAOB may not be able to inspect such audit documentation
+and, as a result, you may be deprived of the benefits of such inspection.
+
+ 
+
+ 25
+
+ 
+
+ 
+
+ 
+
+On August 26, 2022, the PCAOB
+signed a Statement of Protocol (the "SOP") Agreement with the CSRC and China s Ministry of Finance. The SOP, together
+with two protocol agreements governing inspections and investigations (together, the "SOP Agreements"), establish a specific,
+accountable framework to make possible complete inspections and investigations by the PCAOB of audit firms based in China and Hong Kong,
+as required under U.S. law. On December 15, 2022, the PCAOB announced that it has completed a test inspection of two selected auditing
+firms in China and Hong Kong and has voted to vacate its previous Determination Report, which concluded in December 2021 that the PCAOB
+could not inspect or investigate completely registered public accounting firms based in China or Hong Kong. However, if in the future
+the PCAOB is prohibited from conducting complete inspections and investigations of PCAOB-registered public accounting firms in China and
+Hong Kong, then the companies audited by those registered public accounting firms could be subject to a trading prohibition on U.S. markets
+pursuant to the HFCA Act.
+
+ 
+
+If we change auditors and they
+are subsequently located in China or Hong Kong and the PCAOB is unable to inspect or investigate completely our auditor, it could result
+in the prohibition of trading in our securities by not being allowed to list on a U.S. exchange, and as a result an exchange may determine
+to delist our securities, which would materially affect the interest of our investors.
+
+ 
+
+The enactment of Law of the PRC on Safeguarding
+National Security in the Hong Kong (the "Hong Kong National Security Law") could impact our Hong Kong Operating Subsidiaries.
+
+ 
+
+On June 30, 2020, the Standing
+Committee of the PRC National People s Congress adopted the Hong Kong National Security Law. This law defines the duties and government
+bodies of the Hong Kong National Security Law for safeguarding national security and four categories of offenses — secession, subversion,
+terrorist activities and collusion with a foreign country or external elements to endanger national security — and their corresponding
+penalties. On July 14, 2020, the former U.S. President, Donald Trump, signed the HKAA into law, authorizing the U.S. administration to
+impose blocking sanctions against individuals and entities who are determined to have materially contributed to the erosion of Hong Kong s
+autonomy. On August 7, 2020, the U.S. government imposed HKAA-authorized sanctions on eleven individuals, including then Hong Kong chief
+executive Carrie Lam. On October 14, 2020, the U.S. State Department submitted to relevant committees of the United States Congress the
+report required under HKAA, identifying persons materially contributing to "the failure of the Government of China to meet its obligations
+under the Joint Declaration or the Basic Law." The HKAA further authorizes secondary sanctions, including the imposition of blocking
+sanctions, against foreign financial institutions that knowingly conduct a significant transaction with foreign persons sanctioned under
+this authority. The imposition of sanctions may directly affect the foreign financial institutions as well as any third parties or customers
+dealing with any foreign financial institution that is targeted. It is difficult to predict the full impact of the Hong Kong National
+Security Law and HKAA on Hong Kong and companies located in Hong Kong. If our Hong Kong Operating Subsidiaries is determined to be in
+violation of the Hong Kong National Security Law or the HKAA by competent authorities, our business operations, financial position and
+results of operations could be materially and adversely affected.
+
+ 
+
+We may become subject to a variety of PRC laws
+and other regulations regarding privacy, cybersecurity, data protection, data security or securities offerings that are conducted overseas
+and/or other foreign investment in China-based issuers. Any failure to comply with applicable laws and regulations could have a material
+and adverse effect on our business, financial condition and results of operations and may hinder our ability to offer or continue to offer
+Ordinary Shares to investors and cause the value of our Ordinary Shares to significantly decline or be worthless.
+
+ 
+
+On June 10, 2021, the Standing
+Committee of the National People s Congress enacted the PRC Data Security Law, which took effect on September 1, 2021. The law requires
+data collection to be conducted in a legitimate and proper manner, and stipulates that, for the purpose of data protection, data processing
+activities must be conducted based on data classification and hierarchical protection system for data security.
+
+ 
+
+On July 6, 2021, the General Office
+of the Communist Party of China Central Committee and the General Office of the State Council jointly issued a document to crack down
+on certain activities in the securities markets and promote the high-quality development of the capital markets, which, among other things,
+requires the relevant governmental authorities to strengthen cross-border oversight of law-enforcement and judicial cooperation, to enhance
+supervision over China-based companies listed overseas, and to establish and improve the system of extraterritorial application of the
+PRC securities laws.
+
+ 
+
+ 26
+
+ 
+
+ 
+
+ 
+
+On August 20, 2021, the 30th
+meeting of the Standing Committee of the 13th National People s Congress voted and passed the "Personal Information
+Protection Law of the People s Republic of China", or "PRC Personal Information Protection Law", which became
+effective on November 1, 2021. The PRC Personal Information Protection Law applies to the processing of personal information of natural
+persons within the territory of China that is carried out outside of China where (1) such processing is for the purpose of providing products
+or services for natural persons within China, (2) such processing is to analyze or evaluate the behavior of natural persons within China,
+or (3) there are any other circumstances stipulated by related laws and administrative regulations.
+
+ 
+
+On December 28, 2021, the CAC
+jointly with the relevant authorities formally published Measures for Cybersecurity Review (2021) which took effect on February 15, 2022
+and replaced the former Measures for Cybersecurity Review (2020) issued on April 13, 2020. Measures for Cybersecurity Review (2021) stipulates
+that operators of critical information infrastructure purchasing network products and services, and online platform operator (each an
+"Operator", and together with the operators of critical information infrastructure, the "Operators") carrying
+out data processing activities that affect or may affect national security, shall conduct a cybersecurity review, and any online platform
+operator who controls more than one million users personal information must go through a cybersecurity review by the cybersecurity
+review office if it seeks to be listed in a foreign country.
+
+ 
+
+We currently do not control over
+one million users personal information and do not collect data that affects or may affect national security. We may collect and
+store certain data (including certain personal information) abroad from our customers, who may be PRC individuals, in implementing our
+membership schemes in the future, but we do not anticipate that we will be collecting over one million users personal information
+or data that affects or may affect national security in the foreseeable future.
+
+ 
+
+These statements and regulatory
+actions are relatively new. The existing or new laws or regulations or detailed implementations and interpretations may be modified or
+promulgated, if any, and therefore may have potential impact on our daily business operations, our abilities to accept foreign investments
+and the listing of our Ordinary Shares on U.S. or other foreign exchanges. The interpretation and enforcement of relevant PRC cybersecurity
+laws and regulations still need to be determined in accordance with the relevant laws and regulations in effect at that time. If the Trial
+Measures are amended in the future and becomes applicable to us, if our proposed listing on NASDAQ is deemed to be an overseas indirect
+issuance and listing or, if we are deemed to be an "Operator" that are required to file for cybersecurity review before listing
+in the United States. Moreover, if the Measures for Cybersecurity Review (2021) or the PRC Personal Information Protection Law becomes
+applicable to us, our operations and the listing of our Ordinary Shares in the United States could be subject to the CAC s cybersecurity
+review or CSRC Overseas Issuance and Listing review in the future. If we become subject to the CAC review, there is no assurance that
+we will be able to comply with the regulatory requirements in all respects and the current practice of collecting and processing personal
+information may be ordered to be rectified or terminated by regulatory authorities. In the event of a failure to comply, our Company may
+become subject to fines and other penalties which may have a material adverse effect on our business, operations and financial condition,
+and may hinder our ability to offer or continue to offer Ordinary Shares to investors and cause the value of our Ordinary Shares to significantly
+decline or be worthless.
+
+ 
+
+PRC authorities recently initiated
+a series of regulatory actions and made a number of public statements on the regulation of business operations in China, including cracking
+down on illegal activities in the securities market, enhancing supervision over China-based companies listed overseas using a VIE structure,
+adopting new measures to extend the scope of cybersecurity reviews, and expanding efforts in anti-monopoly enforcement.
+
+ 
+
+ 27
+
+ 
+
+ 
+
+ 
+
+On February 17, 2023, with the
+approval of the State Council, the CSRC promulgated the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic
+Companies (the "Trial Measures"), and five supporting guidelines, which came into effect on March 31, 2023. Pursuant to the
+Trial Measures, (i) domestic companies that seek to offer or list securities overseas, both directly and indirectly, shall complete filing
+procedures with the CSRC pursuant to the requirements of the Trial Measures within three working days following their submission of initial
+public offerings or listing applications. If a domestic company fails to complete the required filing procedures or conceals any material
+fact or falsifies any major content in its filing documents, such domestic company may be subject to administrative penalties, such as
+an order to rectify, warnings and fines, and the controlling shareholders or actual controllers which organize or instigate the prescribed
+illegal acts or conceal relevant matters and cause the prescribed circumstances shall be subject to fines, and the person directly in
+charge and other directly liable persons may also be subject to administrative penalties, such as warnings and fines; (ii) if the issuer
+meets both of the following criteria, the overseas offering and listing conducted by such issuer shall be deemed an indirect overseas
+offering and listing by a PRC domestic company: (A) 50% or more of any of the issuer s operating revenue, total profit, total assets
+or net assets as documented in its audited consolidated financial statements for the most recent fiscal year were derived from PRC domestic
+companies; and (B) the majority of the issuer s business activities are carried out in China, or its main place(s) of business are
+located in China, or the majority of its senior management team in charge of its business operations and management are PRC citizens or
+have their usual place(s) of residence located in China. In such circumstances, the issuer shall designate a major domestic operating
+entity responsible for all filing procedures with the CSRC, and shall submit filings with the CSRC within three business days after an
+application for an initial public offering or listing in an overseas market is submitted.
+
+ 
+
+If the PRC authorities choose
+to exert more oversight over the securities offerings that are conducted overseas and/or foreign investment in China-based issuers, and
+if we become subject to such oversight, such action may significantly limit or completely hinder our ability to offer or continue to offer
+Ordinary Shares to investors and cause the value of our Ordinary Shares to significantly decline or be worthless.
+
+ 
+
+Recent statements, laws and regulations
+by the PRC authorities, including the Measures for Cybersecurity Review (2021), the PRC Personal Information Protection Law and the Trial
+Measures, have indicated an intent to exert oversight over the securities offerings that are conducted overseas and/or foreign investments
+in China-based issuers. As of the date of this prospectus, in the opinion of our PRC legal counsel, The Alpha Law Firm, these requirements
+do not directly apply to Hong Kong. Whether such requirements apply to us in the future will be subject to applicable laws and regulations
+at that time. If our proposed securities offerings are subject to review by the CSRC or the CAC could significantly limit or completely
+hinder our ability to offer or continue to offer securities to investors and could cause the value of such securities to significantly
+decline or be worthless. Further, if we were to become subject to PRC laws and/or authorities, we could incur material time and
+costs to ensure compliance and experience devaluation of our Ordinary Shares or possibly delisting.
+
+ 
+
+Failure
+to comply with PDPO may result in material and adverse effect on our business, financial condition and results of operations
+
+ 
+
+As
+we conduct our operations and operate our business in Hong Kong, we are subject to a variety of laws and other obligations regarding
+data privacy and protection in Hong Kong. In particular, the Personal Data (Privacy) Ordinance (Chapter 486 of the Laws of Hong Kong)
+(the "PDPO") which imposes a duty on any data user who, either alone or jointly with other persons, shall not do any act,
+or engage in a practice, that contravenes any of the data protection principles set out in Schedule 1 to the PDPO (the "Data Protection
+Principles") unless the act or practice, as the case may be, is required or permitted under the PDPO. Once collected, the personal
+data should be processed in a secure manner and should only be kept for as long as necessary for the fulfillment of the purposes of using
+the data and shall be erased if it is no longer required, unless erasure is prohibited by law or is not in the public interest. Use of
+the data should be limited to or related to the original collection purpose. Under the PDPO, data users shall take all practicable steps
+to protect the personal data they hold from any unauthorized or accidental access, processing, erasure, loss, or use. The PDPO also confers
+on the Privacy Commissioner for Personal Data ("Commissioner") power to conduct investigations and institute prosecutions.
+Contravention with the PDPO may entitle the Commissioner to issue a written enforcement notice directing such data user to take prescribed
+steps within a specified timeframe to remedy and prevent recurrence of contravention. Contravention with the above enforcement notice
+issued by the Commissioner is an offence. However, if a data user has taken all due diligence to comply with the enforcement notice,
+then such data user may have a defence against the above offence. A civil claim for compensation may also be made by a data subject for
+damage caused by a contravention of the PDPO. See "Regulatory Environment – Personal Data (Privacy) Ordinance" on page
+89.
+
+ 
+
+We
+believe that we have complied with the PDPO. Moreover, we do not expect to be subject to any cybersecurity review by Hong Kong government
+authorities for this offering. Certain user data and information may be collected during the course of our business operations. Accordingly,
+data protection measures are put in place to ensure the data and information that the Company collects are not misappropriated or misused.
+However, if we have violated certain provisions of the PDPO, we could face significant civil claims and/or criminal prosecution, which
+could adversely affect our business, financial condition, and results of operations.
+
+ 
+
+The Hong Kong legal
+system is subject to uncertainties which could limit the legal protections available to us.
+
+ 
+
+Hong
+Kong is a Special Administrative Region of the PRC. Following British colonial rule from 1842 to 1997, China assumed sovereignty under
+the "one country, two systems" principle. Hong Kong s constitutional document, the Basic Law, ensures that the current
+political situation will remain in effect for 50 years. Hong Kong has enjoyed the freedom to function with a high degree of autonomy for
+its affairs, including currencies, immigration and customs operations, and its independent judiciary system and parliamentary system.
+On July 14, 2020, the United States signed an executive order to end the special status enjoyed by Hong Kong post-1997. As the autonomy
+currently enjoyed may be compromised, it could potentially impact Hong Kong s common law legal system and may, in turn, result in
+uncertainty in, for example, the enforcement of our contractual rights. This could materially and adversely affect our business and operations.
+Additionally, intellectual property rights and confidentiality protections in Hong Kong may not be as effective as in the United States
+or other countries. Accordingly, we cannot predict the effect of future developments in the Hong Kong legal system, including the promulgation
+of new laws, changes to existing laws or the interpretation or enforcement thereof, or the pre-emption of local regulations by national
+laws. These uncertainties could limit the legal protections available to us, including our ability to enforce our agreements with our
+vendors.
+
+ 
+
+Risks Related to Litigation, Laws and Regulation
+and Governmental Matters
+
+ 
+
+Unfavorable global and regional economic, political
+and health conditions could adversely affect our business, financial condition or results of operations.
+
+ 
+
+Our results of operations could
+be adversely affected by global or regional economic, political and health conditions. A global financial crisis or global or regional
+political and economic instability (including changes in inflation, interest rates and overall economic conditions and uncertainties),
+wars, terrorism, civil unrest, outbreaks of disease (for example, COVID-19), and other unexpected events, such as supply chain constraints
+or disruptions, could cause extreme volatility, increase our costs and disrupt our business. For example, these macroeconomic factors
+could affect the ability of our current or potential future manufacturers, sole source or single source suppliers, licensors or licensees
+to remain in business, or otherwise manufacture or supply components, materials or services relevant to our services. In addition, if
+inflation or other factors were to significantly increase our business costs, we may be unable to pass through price increases to our
+customers. We are impacted by inflationary increases in wages, benefits and other costs. If we are not able to pass increased wage and
+other costs resulting from inflation onto our clients our profitability may decline.
+
+ 
+
+ 28
+
+ 
+
+ 
+
+ 
+
+Potential claims from customers or employees
+could have a material adverse effect on our business.
+
+ 
+
+We may be subject to claims brought
+by or on behalf of our customers or employees in the ordinary course of business which could adversely affect our business. Potential
+claims could include liability claims relating to our employment practices, advertising practices, data security or privacy breaches,
+intellectual property infringement, tenancy issues and other concerns. Any involvement in litigation could incur significant resources
+and divert our management s attention, or even create negative publicity, which could adversely affect our reputation and hence
+our business. Even though we maintain what we believe to be adequate levels of insurance to cover our potential liabilities, our insurance
+may not cover all relevant claims or provide sufficient coverage. Our business, financial condition and operating results could be materially
+adversely affected if costs resulting from future claims are not covered by our insurance or exceed our coverage.
+
+ 
+
+It will be difficult to obtain jurisdiction
+and enforce liabilities against our officers, Directors and assets outside the United States.
+
+ 
+
+All of our assets are currently
+located outside of the United States. Additionally, our director, director nominees, and officers reside outside of the United States,
+with each of our officers and directors located in the PRC or Hong Kong. Additionally, our key management and operations are primarily
+based in Hong Kong. As a result, it may not be possible for United States investors to enforce their legal rights,
+to effect service of process upon our Directors or officers or to enforce judgments of United States courts predicated
+upon civil liabilities and criminal penalties of our Directors and officers under Federal securities laws in Hong Kong or the Cayman
+Islands. Moreover, we have been advised that Hong Kong and Cayman Islands do not have a treaty providing for the reciprocal recognition
+and enforcement of judgments of courts with the United States. For more information regarding the relevant laws of the Cayman Islands
+and Hong Kong, see "Enforcement of Civil Liabilities".
+
+ 
+
+Changes in foreign currency exchange rates may
+negatively affect our financial condition and results of operations.
+
+ 
+
+The reporting currency of the
+Company is U.S. Dollars, to date the majority of the Company s revenues and costs are denominated in US$ and HK$, a majority of
+the Company s assets are denominated in US$ and HK$ and a significant portion of the Company s liabilities are denominated
+in HK$. As a result, the Company is exposed to foreign exchange risk as its revenues and results of operations may be affected by fluctuations
+in the exchange rate between US$ and HK$. For example, during 2022 and 2023, the U.S. dollar strengthened against certain foreign currencies
+and this may cause a decrease in some of our monetary assets which are denominated in foreign currencies and lead to the recognition of
+foreign exchange losses. In addition, most of our financial obligations must be satisfied in U.S. dollars. Our exposures to changes in
+foreign currency exchange rates may change over time as our business practices evolve and could result in increased costs or reduced revenue
+and could adversely affect our cash flow. Changes in the relative values of currencies occur regularly and may have a significant impact
+on our operating results. We cannot predict with any certainty changes in foreign currency exchange rates or the degree to which we can
+cost-effectively mitigate this exposure.
+
+ 
+
+Risks Related to Being a Public Company
+
+ 
+
+Public company compliance may make it more difficult
+to attract and retain officers and Directors.
+
+ 
+
+Public company compliance may
+make it more difficult to attract and retain officers and Directors. The Sarbanes-Oxley Act and new rules subsequently implemented by
+the SEC have required changes in corporate governance practices of public companies. As a public company, we expect these new rules and
+regulations to increase our compliance costs in 2024 and beyond and to make certain activities more time consuming and costly. As a public
+company, we also expect that these new rules and regulations may make it more difficult and expensive for us to obtain director and officer
+liability insurance in the future and we may be required to accept reduced policy limits and coverage or incur substantially higher costs
+to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain qualified persons to serve
+on our board of Directors or as executive officers.
+
+ 
+
+We have no experience operating as a public
+company.
+
+ 
+
+We have no experience conducting
+our operations as a public company. After we become a public company, we may face enhanced administrative and compliance requirements,
+which may result in substantial costs. The majority of our Directors and executive officers have no experience in operating a U.S. public
+company, which makes our ability to comply with applicable laws, rules and regulations uncertain. Our failure to comply with all laws,
+rules and regulations applicable to U.S. public companies could subject us or our management to regulatory scrutiny or sanction, which
+could harm our reputation and share price.
+
+ 
+
+ 29
+
+ 
+
+ 
+
+ 
+
+We will be subject to changing laws, rules and
+regulations in the U.S. regarding regulatory matters, corporate governance and public disclosure that will increase both our costs and
+the risks associated with non-compliance.
+
+ 
+
+Following this offering, we will
+be subject to rules and regulations by various governing bodies and self-regulatory organizations, including, for example, the SEC and
+The Nasdaq Stock Market, which are charged with the protection of investors and the oversight of companies whose securities are publicly
+traded, and to new and evolving regulatory measures under applicable law. Our efforts to comply with new and changing laws and regulations
+have resulted in and are likely to continue to result in increased general and administrative expenses and a diversion of management time
+and attention from revenue-generating activities to compliance activities.
+
+ 
+
+Moreover, because these laws,
+regulations and standards are subject to varying interpretations, their application in practice may evolve over time as new guidance becomes
+available. This evolution may result in continuing uncertainty regarding compliance matters and additional costs necessitated by ongoing
+revisions to our disclosure and governance practices. If we fail to address and comply with these regulations and any subsequent changes,
+we may be subject to penalty and our business may be harmed.
+
+ 
+
+We are a foreign private issuer and, as a result,
+are not subject to U.S. proxy rules but are subject to Exchange Act reporting obligations that, to some extent, are more lenient
+and less frequent than those of a U.S. issuer.
+
+ 
+
+Because we qualify as a foreign
+private issuer under the federal securities laws and although we follow Cayman Islands laws and regulations with regard to such matters,
+we are exempt from certain provisions of the Exchange Act that are applicable to U.S. public companies, including: (i) the sections
+of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under
+the Exchange Act, (ii) the sections of the Exchange Act requiring insiders to file public reports of their stock ownership
+and trading activities and liability for insiders who profit from trades made in a short period of time, and (iii) the rules under
+the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q containing unaudited financial and other
+specified information, or current reports on Form 8-K, upon the occurrence of specified significant events. In addition, foreign
+private issuers will be required to file their annual report on Form 20-F by 120 days after the end of each fiscal year, while
+U.S. domestic issuers that are non-accelerated filers are required to file their annual report on Form 10-K within 90 days after
+the end of each fiscal year. Foreign private issuers are also exempt from Regulation Fair Disclosure, aimed at preventing issuers
+from making selective disclosures of material information. As a result of the above, even though we are contractually obligated and intend
+to make interim reports available to our shareholders, copies of which we are required to furnish to the SEC on a Form 6-K, and even
+though we are required to file reports on Form 6-K disclosing whatever information we have made or are required to make public pursuant
+to the laws of the Cayman Islands or distribute to our shareholders and that is material to our company, you may not have the same protections
+afforded to shareholders of companies that are U.S. domestic issuers.
+
+ 
+
+Because we are a foreign private issuer and
+are exempt from certain Nasdaq corporate governance standards applicable to U.S. issuers, you will have less protection than you would
+have if we were a domestic issuer.
+
+ 
+
+We, as a foreign private issuer,
+may not be subject to all of the corporate governance standards applicable to U.S. issuers. Accordingly, we may consider following home
+country practice in lieu of the requirements under the Nasdaq Listed Company Manual with respect to certain corporate governance standards
+which may afford less protection to investors. For example, the Nasdaq Listed Company Manual requires listed companies to have, among
+other things, a majority of its board members be independent. As a foreign private issuer, however, we are permitted to, and we may follow home country
+practice in lieu of the above requirements, or we may choose to comply with the above requirement within one year of listing. The corporate
+governance practice in our home country, the Cayman Islands, does not require a majority of our board to consist of
+independent directors. Thus, although a director must act in the best interests of the Company, it is possible that fewer board members
+will be exercising independent judgment and the level of board oversight on the management of our company may decrease as a result. In
+addition, the Nasdaq Listed Company Manual also requires U.S. domestic issuers to have a compensation committee, and may have a nominating/corporate
+governance committee composed entirely of independent directors. We do not intend to comply with such committee requirements.
+
+ 
+
+ 30
+
+ 
+
+ 
+
+ 
+
+We may lose our foreign private issuer status
+in the future, which could result in significant additional costs and expenses.
+
+ 
+
+As discussed above, we are a foreign
+private issuer, and therefore, we are not required to comply with all of the periodic disclosure and current reporting requirements of
+the Exchange Act. The determination of foreign private issuer status is made annually on the last business day of an issuer s
+most recently completed second fiscal quarter. In the future, we would lose our foreign private issuer status if (1) more than 50%
+of our outstanding voting securities are owned by U.S. residents, and (2) a majority of our Directors or executive officers are U.S.
+citizens or residents, or we fail to meet additional requirements necessary to avoid loss of foreign private issuer status. If we lose
+our foreign private issuer status, we will be required to file with the SEC periodic reports and registration statements on U.S. domestic
+issuer forms, which are more detailed and extensive than the forms available to a foreign private issuer. We will also have to mandatorily
+comply with U.S. federal proxy requirements, and our officers, Directors and principal shareholders will become subject to the short-swing
+profit disclosure and recovery provisions of Section 16 of the Exchange Act. In addition, we will lose our ability to rely upon exemptions
+from certain corporate governance requirements under the listing rules of Nasdaq. As a U.S. listed public company that is not a foreign
+private issuer, we will incur significant additional legal, accounting and other expenses that we will not incur as a foreign private
+issuer.
+
+ 
+
+As an exempted company incorporated in the Cayman
+Islands with limited liability, we are permitted to adopt certain home country practices in relation to corporate governance matters that
+differ significantly from Nasdaq corporate governance listing standards. These practices may afford less protection to shareholders than
+they would enjoy if we complied fully with Nasdaq corporate governance listing standards.
+
+ 
+
+As a foreign private issuer that
+has applied to list our Ordinary Shares on Nasdaq, we rely on a provision in the Nasdaq corporate governance listing standards that allows
+us to follow Cayman Islands law with regard to certain aspects of corporate governance. This allows us to follow certain corporate governance
+practices that differ in significant respects from the corporate governance requirements applicable to U.S. companies listed on Nasdaq.
+
+ 
+
+For example, we are exempt from
+the following Nasdaq regulations:
+
+ 
+
+ 
+ 
+ 
+ Rule
+ 5605(b)(2), pursuant to which the independent directors must have regularly scheduled meetings at which only independent directors
+ are present;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Rule
+ 5635(a), pursuant to which shareholder approval is required in certain circumstances prior to an issuance of securities in connection
+ with the acquisition of the stock or assets of another company; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Rule
+ 5635(b), pursuant to which shareholder approval is required prior to the issuance of securities when the issuance or potential issuance
+ will result in a change of control of the company.
+
+ 
+ 
+
+As a foreign private issuer,
+we are permitted to follow home country practice in lieu of the above requirements.
+
+ 
+
+ 31
+
+ 
+
+ 
+
+ 
+
+You may face difficulties in protecting your
+interests, and your ability to protect your rights through U.S. courts may be limited, because we are incorporated under Cayman Islands
+law.
+
+ 
+
+We are an exempted company incorporated
+under the laws of the Cayman Islands with limited liability. After the closing of the offering, our corporate affairs will be governed
+by our Amended and Restated Memorandum and Articles of Association, the Companies Act and the common law of the Cayman Islands. The rights
+of shareholders to take action against our Directors and us, actions by minority shareholders and the fiduciary duties of our Directors
+to us under Cayman Islands law are to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands
+is derived in part from comparatively limited judicial precedent in the Cayman Islands as well as from English common law, which are generally
+of persuasive authority, but are not binding, on a court in the Cayman Islands. The rights of our shareholders and the fiduciary duties
+of our Directors under Cayman Islands law are not as clearly established as they would be under statutes or judicial precedent in some
+jurisdictions in the United States. In particular, the Cayman Islands has a different body of securities laws than the United States,
+and provide significantly less protection to investors. In addition, Cayman Islands companies may not have the standing to initiate a
+shareholder derivative action in a federal court of the United States. There is no statutory recognition in the Cayman Islands of
+judgments obtained in the United States, although the courts of the Cayman Islands will generally recognize and enforce a non-penal
+judgment of a foreign court of competent jurisdiction without retrial on the merits.
+
+ 
+
+Shareholders of Cayman Islands
+exempted companies like us have no general rights under Cayman Islands law to inspect corporate records (other than as set forth in our
+Amended and Restated Memorandum and Articles of Association or to obtain copies of lists of shareholders of these companies. Our Directors
+are not required under our Amended and Restated Memorandum and Articles of Association to make our corporate records available for inspection
+by our shareholders. This may make it more difficult for you to obtain the information needed to establish any facts necessary for a shareholder
+resolution or to solicit proxies from other shareholders in connection with a proxy contest.
+
+ 
+
+Certain corporate governance practices
+in the Cayman Islands, which is our home country, differ significantly from requirements for companies incorporated in other jurisdictions
+such as U.S. states. Currently, we plan to rely on home country practice with respect to any corporate governance matter. Accordingly,
+our shareholders may be afforded less protection than they otherwise would under rules and regulations applicable to U.S. domestic issuers.
+
+ 
+
+Further, all of our current
+operations are conducted outside of the United States and all of our current assets are located outside of the United States, with the
+majority of our operations and current assets being located in Hong Kong. All of the Directors and Executive Officers of our Company reside outside the United States and substantially all of their assets are located outside the United
+States, with each of our officers and directors and director nominees located in Hong Kong. As a result, it may not be possible for investors
+to effect service of process within the United States upon us or any such persons, or to enforce in the United States any judgment obtained
+in the U.S. courts against us or any of such persons, including judgments based upon the civil liability provisions of the U.S. securities
+laws or any U.S. state or territory.
+
+ 
+
+As a result of all of the above,
+shareholders may have more difficulty in protecting their interests in the face of actions taken by our management, members of the board
+of Directors or controlling shareholders than they would as shareholders of a company incorporated in a U.S. state. For a discussion of
+significant differences between the provisions of the Companies Act and the laws applicable to companies incorporated in a U.S. state
+and their shareholders, see the section entitled "Description of Securities — Differences in Corporate Law."
+
+ 
+
+Risks Related to Ownership of our Securities
+
+ 
+
+Investors in this offering will experience immediate
+and substantial dilution in net tangible book value.
+
+ 
+
+The public offering price per
+Ordinary Share will be substantially higher than the net tangible book value per Ordinary Share of our outstanding ordinary shares. As
+a result, investors in this offering will incur immediate dilution of $4.77 per share, based on the assumed initial public offering
+price of $5 per share, which is the midpoint of the estimated offering price range described on the cover of this prospectus assuming
+no exercise of over-allotment options. Investors in this offering will pay a price per unit that substantially exceeds the book value
+of our assets after subtracting our liabilities. See "Dilution" for a more complete description of how the value of
+your investment will be diluted upon the completion of this offering.
+
+ 
+
+The sale or availability for sale of substantial
+amounts of our Ordinary Shares, including the Ordinary Shares held by our Resale Shareholders that are being registered concurrently
+for resale in the Resale Prospectus, could adversely affect the market price
+
+ 
+
+Sales of substantial amounts
+of our Ordinary Shares in the public market after the completion of this offering and from the sale of shares of up to 1,600,000 Ordinary
+Shares held by our Resale Shareholders through the Resale Prospectus, or the perception that these sales could occur could adversely
+affect the market price of our shares and could materially impair our ability to raise capital through equity offerings in the future.
+An aggregate of 3,500,000 Class A Ordinary Shares and 16,500,000 Class B Ordinary Shares are outstanding immediately before the
+consummation of this offering and 5,500,000 Class A Ordinary Shares and 16,500,000 Class B Ordinary Shares will be outstanding immediately
+after the consummation of this offering if the underwriter does not exercise its over-allotment option, and 5,800,000 Class A Ordinary
+Shares and 16,500,000 Class B Ordinary Shares will be outstanding immediately after the consummation of this offering if the underwriter
+exercises its over-allotment option in full. The shares sold in this offering will be freely tradable without restriction or further
+registration under the Securities Act, and subject to the terms of the Lock-Up Agreements, shares held by the certain other shareholders
+may also be sold in the public market subject to the restrictions in Rule 144 and Rule 701 under the Securities Act. The 1,600,000 Ordinary
+Shares held by the Resale Shareholders that are being registered concurrently for resale in the Resale Prospectus are not subject to
+lock-up agreements. In connection with this offering, our Directors and Executive Officers named in the section "Management,"
+have agreed not to sell any shares until 12-month after the date of this prospectus without the prior written consent of the representative
+of the underwriter, subject to certain exceptions, unless the underwriter releases these securities from these restrictions. The Resale
+Shareholders acquired their Ordinary Shares at a price of $0.02 per Ordinary Share, and as a result, may be willing to accept a lower
+sales price than the price investors pay in this offering, which could substantially lower the market price of our Ordinary Shares. We
+cannot predict what effect, if any, market sales of securities held by the Resale Shareholders or any other shareholder or the availability
+of these securities for future sale will have on the market price of our shares. If we are unable to satisfy the Nasdaq Capital Market
+criteria for maintaining our listing, including but not limited to maintaining the minimum bid price of $1.00 per Ordinary Share, our
+Ordinary Shares could be subject to delisting. See "Underwriting" and "Shares Eligible for Future Sale" for a
+more detailed description of the restrictions on selling our securities after this offering.
+
+ 
+
+Sales of substantial amounts
+of our Ordinary Shares in the public market after the completion of this offering, or the perception that these sales could occur, could
+cause the market price of our Ordinary Shares to decline. The Ordinary Shares sold in this offering will be freely tradable without restriction
+or further registration under the Securities Act, and certain Ordinary Shares held by our existing shareholders may also be sold in the
+public market in the future, subject to the restrictions in Rule 144 and Rule 701 under the Securities Act and the applicable lock-up
+agreements. An aggregate of 3,500,000 Class A Ordinary Shares and 16,500,000 Class B Ordinary Shares are outstanding
+immediately before the consummation of this offering and 5,500,000 Class A Ordinary Shares and 16,500,000 Class
+B Ordinary Shares will be outstanding immediately after the consummation of this offering if the underwriter does not exercise its over-allotment
+option, and 5,800,000 Class A Ordinary Shares and 16,500,000 Class B Ordinary Shares will be outstanding immediately
+after the consummation of this offering if the underwriter exercises its over-allotment option in full. Sales of these shares into the
+market could cause the market price of our Ordinary Shares to decline.
+
+ 
+
+ 32
+
+ 
+
+ 
+
+ 
+
+Because we do not expect to pay dividends in
+the foreseeable future, you must rely on price appreciation of our Ordinary Shares for a return on your investment.
+
+ 
+
+We currently intend to retain
+all of our available funds and any future earnings after this offering to fund the development and growth of our business. As a result,
+we do not expect to pay any cash dividends in the foreseeable future. Therefore, you should not rely on an investment in our shares as
+a source for any future dividend income. Our board of Directors has complete discretion as to whether to distribute dividends, subject
+to certain requirements of Cayman Islands and Hong Kong laws. Even if our board of Directors decides to declare and pay dividends, the
+timing, amount and form of future dividends, if any, will depend on, among other things, our future results of operations and cash flow,
+our capital requirements and surplus, the amount of distributions, if any, received by us from our Hong Kong Operating Subsidiaries, our
+financial condition, contractual restrictions and other factors as determined by our board of Directors. Accordingly, the return on your
+investment in our Ordinary Shares will likely depend entirely upon any future price appreciation of our Ordinary Shares. There is no guarantee
+that our Ordinary Shares will appreciate in value after this offering or even maintain the price at which you purchased our shares. You
+may not realize a return on your investment in our shares and you may even lose your entire investment.
+
+ 
+
+Our Ordinary Shares will be subject to potential
+delisting if we do not meet or continue to maintain the listing requirements of Nasdaq.
+
+ 
+
+We have submitted an application
+to list our Ordinary Shares on Nasdaq, under the ticker symbol "MEON". Nasdaq has rules for continued listing, including,
+without limitation, minimum market capitalization and other requirements. Failure to maintain our listing, or de-listing from Nasdaq,
+would make it more difficult for shareholders to sell our securities and more difficult to obtain accurate price quotations on our securities.
+This could have an adverse effect on the price of our Ordinary Shares. Our ability to issue additional securities for financing or other
+purposes, or otherwise to arrange for any financing we may need in the future, may also be materially and adversely affected if our shares
+are not traded on a national securities exchange.
+
+ 
+
+There has been no prior public trading market
+for our Ordinary Shares and an active trading market may not develop or be sustained following this offering.
+
+ 
+
+Prior to this offering there has
+been no prior public trading market for our Ordinary Shares. We cannot assure you that an active trading market for our Ordinary Shares
+will develop or, if developed, that any market will be sustained. Accordingly, we cannot assure you of the liquidity of any trading market,
+your ability to sell your shares of our ordinary shares when desired or the prices that you may obtain for your shares of our Ordinary
+Shares. Even if an active market for our Ordinary Shares does develop, the market price of such securities may be highly volatile. In
+addition to the uncertainties relating to future operating performance and the profitability of operations, factors such as variations
+in interim financial results or various, as yet unpredictable, factors, many of which are beyond our control, may have a negative effect
+on the market price of our securities.
+
+ 
+
+The market price of our equity securities may
+be volatile, and your investment could suffer or decline in value.
+
+ 
+
+The stock markets, including
+Nasdaq, on which certain of our securities will be listed, have from time to time experienced significant price and volume fluctuations.
+Even if an active, liquid and orderly trading market develops and is sustained for our Ordinary Shares, the market price of our Ordinary
+Shares may be volatile and could decline significantly. If our securities become delisted from Nasdaq, the liquidity and price of our
+securities may be more limited than if our securities were quoted or listed on Nasdaq or another national securities exchange. In addition,
+the trading volume in our Ordinary Shares may fluctuate and cause significant price variations to occur. We cannot assure you that the
+market price of our Ordinary Shares will not fluctuate widely or decline significantly in the future in response to a number of factors,
+including, among others, the following:
+
+ 
+
+ 
+ 
+ 
+ Sales of a significant number of our securities, including those which we are registering under the registration statement of which this prospectus is a part, or that we may in the future register for sale or for resale on behalf of our securityholders, could materially adversely affect the trading prices of our securities;
+
+ 
+ 
+
+ 33
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ the realization of any of the risk factors presented in this prospectus;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ actual or anticipated differences in our estimates, or in the estimates of analysts, for our revenues, earnings, results of operations, level of indebtedness, liquidity or financial condition;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ failure to comply with the requirements of Nasdaq;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ failure to comply with the Sarbanes-Oxley Act or other laws or regulations;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ variance in our financial performance from the expectations of market analysts;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ announcements by us or our competitors of significant business developments, changes in service provider relationships, acquisitions or expansion plans;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ changes in the prices of our food offerings and services;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ commencement of, or involvement in, litigation involving us;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ future issuances, sales, repurchases or anticipated issuances, sales, resales or repurchases, of our securities including due to the expiration of contractual lock-up agreements;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ publication of research reports about us;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ failure of securities analysts to initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow us or our failure to meet these estimates or the expectations of investors;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ new laws, regulations, subsidies, or credits or new interpretations of existing laws applicable to us;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ market conditions in our industry;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ changes in key personnel;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ speculation in the press or investment community;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ changes in the estimation of the future size and growth rate of our markets;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ broad disruptions in the financial markets, including sudden disruptions in the credit markets;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ actual, potential or perceived control, accounting or reporting problems;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ changes in accounting principles, policies and guidelines; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ other events or factors, including those resulting from infectious diseases, health epidemics and pandemics, natural disasters, war, acts of terrorism or responses to these events.
+
+ 
+ 
+
+In the event that our Ordinary Shares are listed
+on Nasdaq, our share price could fall and we could be delisted in which case broker-dealers may be discouraged from effecting transactions
+in our Ordinary Shares because they may be considered penny stocks and thus be subject to the penny stock rules.
+
+ 
+
+The SEC has adopted a number of
+rules to regulate "penny stocks" that restricts transactions involving stock which is deemed to be penny stock. Such
+rules include Rules 3a51-1, 15g-1, 15g-2, 15g-3, 15g-4, 15g-5, 15g-6, 15g-7, and 15g-9 under the Securities and Exchange Act of 1934,
+as amended. These rules may have the effect of reducing the liquidity of penny stocks. "Penny stocks" generally are equity
+securities with a price of less than $5.00 per share (other than securities registered on certain national securities exchanges or quoted
+on Nasdaq if current price and volume information with respect to transactions in such securities is provided by the exchange or system).
+Our securities may in the future constitute, "penny stock" within the meaning of the rules. The additional sales practice
+and disclosure requirements imposed upon U.S. broker-dealers may discourage such broker-dealers from effecting transactions in shares
+of our Ordinary Shares, which could severely limit the market liquidity of such shares and impede their sale in the secondary market.
+
+ 
+
+ 34
+
+ 
+
+ 
+
+ 
+
+A U.S. broker-dealer selling penny
+stock to anyone other than an established customer or "accredited investor" (generally, an individual with net worth in excess
+of $1,000,000 or an annual income exceeding $200,000, or $300,000 together with his or her spouse) must make a special suitability determination
+for the purchaser and must receive the purchaser s written consent to the transaction prior to sale, unless the broker-dealer or
+the transaction is otherwise exempt. In addition, the "penny stock" regulations require the U.S. broker-dealer to deliver,
+prior to any transaction involving a "penny stock", a disclosure schedule prepared in accordance with SEC standards relating
+to the "penny stock" market, unless the broker-dealer or the transaction is otherwise exempt. A U.S. broker-dealer is also
+required to disclose commissions payable to the U.S. broker-dealer and the registered representative and current quotations for the securities.
+Finally, a U.S. broker-dealer is required to submit monthly statements disclosing recent price information with respect to the "penny
+stock" held in a customer s account and information with respect to the limited market in "penny stocks".
+
+ 
+
+Shareholders should be aware that,
+according to the SEC, the market for "penny stocks" has suffered in recent years from patterns of fraud and abuse. Such
+patterns include (i) control of the market for the security by one or a few broker-dealers that are often related to the promoter
+or issuer, (ii) manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases,
+(iii) "boiler room" practices involving high-pressure sales tactics and unrealistic price projections by inexperienced sales
+persons, (iv) excessive and undisclosed bid-ask differentials and markups by selling broker-dealers, and (v) the wholesale dumping
+of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, resulting in investor losses.
+Our management is aware of the abuses that have occurred historically in the penny stock market. Although we do not expect to be in a
+position to dictate the behavior of the market or of broker-dealers who participate in the market, management will strive within the confines
+of practical limitations to prevent the described patterns from being established with respect to our securities.
+
+ 
+
+We may issue preferred shares, the terms of
+which could adversely affect the voting power or value of Ordinary Shares.
+
+ 
+
+Our Amended and Restated Memorandum
+and Articles of Association will authorize us to issue, without the approval of our shareholders, one or more classes or series of preferred
+shares having such designations, preferences, limitations and relative rights, including preferences over our Ordinary Shares respecting
+dividends and distributions, as our board of Directors may determine. The terms of one or more classes or series of preferred shares could
+adversely impact and dilute the voting power or value of our Ordinary Shares. For example, we might grant holders of preferred shares
+the right to elect some number of our Directors in all events or on the happening of specified events or the right to veto specified transactions.
+Similarly, the repurchase or redemption rights or liquidation preferences we might assign to holders of preferred shares could affect
+the residual value of our Ordinary Shares.
+
+ 
+
+If securities analysts were to downgrade our
+shares, publish negative research or reports or fail to publish reports about our business, our competitive position could suffer, and
+our share price and trading volume could decline.
+
+ 
+
+The trading market for our Ordinary
+Shares will, to some extent, depend on the research and reports that securities analysts may publish about us, our business, our market
+or our competitors. We do not have any control over these analysts. We do not currently have and may never obtain research coverage by
+securities analysts. If no or few securities analysts commence coverage of us, the trading price of our shares would likely decrease.
+Even if we do obtain analyst coverage, if one or more of the analysts who cover us should downgrade our shares or publish negative research
+or reports, cease coverage of our company or fail to regularly publish reports about our business, our competitive position could suffer,
+and our share price and trading volume could decline.
+
+ 
+
+The requirements of being a public company,
+including compliance with the reporting requirements of the Exchange Act, and the requirements of the Sarbanes-Oxley Act, may strain
+our resources, increase our costs and divert management s attention, and we may be unable to comply with these requirements in a
+timely or cost-effective manner.
+
+ 
+
+As a public company, we will need
+to comply with new laws, regulations and requirements, certain corporate governance provisions of the Sarbanes-Oxley Act, the Exchange Act,
+related regulations of the SEC and the requirements of Nasdaq, with which we are not required to comply as a private company. Complying
+with these statutes, regulations and requirements will occupy a significant amount of time of our board of Directors and management and
+will significantly increase our costs and expenses. We will need to:
+
+ 
+
+ 
+ 
+ 
+ institute a more comprehensive compliance function;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ comply with rules promulgated by Nasdaq;
+
+ 
+ 
+
+ 35
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ continue to prepare and distribute periodic public reports in compliance with our obligations under the federal securities laws;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ establish new internal policies, such as those relating to insider trading; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ involve and retain to a greater degree outside counsel and accountants in the above activities.
+
+ 
+ 
+
+Our internal control over financial reporting
+may not be effective and our independent registered public accounting firm may not be able to certify as to their effectiveness in the
+future, which could have a significant and adverse effect on our business, financial condition, results of operations and reputation.
+
+ 
+
+After the completion of this offering,
+we will be subject to a requirement, pursuant to Section 404 of the Sarbanes-Oxley Act, to conduct an annual review and evaluation
+of our internal control over financial reporting and furnish a report by management on, among other things, our assessment of the effectiveness
+of our internal control over financial reporting each fiscal year beginning with the year following our first annual report required to
+be filed with the SEC. However, because we are an emerging growth company, our independent registered public accounting firm is not required
+to formally attest to the effectiveness of our internal control over financial reporting pursuant to Section 404 until the earlier
+of the fifth year following our first annual report required to be filed with the SEC or the date we are no longer an emerging growth
+company. Ensuring that we have adequate internal control over financial reporting in place so that we can produce accurate financial statements
+on a timely basis is a costly and time-consuming effort that must be evaluated frequently. Establishing and maintaining these internal
+controls will be costly and may divert management s attention.
+
+ 
+
+When evaluating our internal control
+over financial reporting, we may identify material weaknesses that we may not be able to remediate in time to meet the applicable deadline
+imposed upon us for compliance with the requirements of Section 404 of the Sarbanes-Oxley Act. In addition, if we fail to achieve
+and maintain the adequacy of our internal control over financial reporting, as such standards are modified, supplemented or amended from
+time to time, we may not be able to ensure that we can conclude, on an ongoing basis, that we have effective internal control over financial
+reporting in accordance with Section 404 of the Sarbanes-Oxley Act. We cannot be certain as to the timing of completion of our evaluation,
+testing and any remediation actions or the impact of the same on our operations. If we do not adequately implement or comply with the
+requirements of Section 404 of the Sarbanes-Oxley Act, we may be subject to sanctions or investigation by regulatory authorities,
+such as the SEC, or suffer other adverse regulatory consequences, including penalties for violation of Nasdaq Listing Rules. As a result,
+there could be a negative reaction in the financial markets due to a loss of confidence in the reliability of our financial statements.
+A loss of confidence in the reliability of our financial statements also could occur if we or our independent registered public accounting
+firm were to report one or more material weaknesses in our internal control over financial reporting. In addition, we may be required
+to incur costs in improving our internal control system, including the costs of the hiring of additional personnel. Any such action could
+negatively affect our business, financial condition, results of operations and cash flows and could also lead to a decline in the price
+of our Ordinary Shares.
+
+ 
+
+Management will have broad discretion over the
+use of our proceeds from this offering.
+
+ 
+
+The principal purposes of
+this offering include increasing our capitalization and financial flexibility, creating a public market for our shares, thereby enabling
+access to the public equity markets by our employees and shareholders, obtaining additional capital and increasing our visibility in
+the marketplace. Although we have not yet determined with certainty the manner in which we will allocate the net proceeds of this offering,
+we plan to use the net proceeds of this offering for those items as set forth below under in the heading "Use of Proceeds"
+below. We have not allocated specific amounts of net proceeds for any of these purposes and we cannot specify with certainty the particular
+uses of the net proceeds to us from this offering. Accordingly, we will have broad discretion in using these proceeds and might not be
+able to obtain a significant return, if any, on investment of these net proceeds. Investors in this offering will need to rely upon the
+judgment of our management with respect to the use of our proceeds. We will not receive any of the proceeds from the sale of the Selling Shareholder s shares through the underwriter
+and from the sale of the Resale
+Shares by the Resale Shareholders. If we do not use the net proceeds that we receive in this offering effectively, our business, operating
+results and financial condition could be harmed.
+
+ 
+
+ 36
+
+ 
+
+ 
+
+ 
+
+For as long as we are an emerging growth company,
+we will not be required to comply with certain requirements that apply to other public companies.
+
+ 
+
+We are an emerging growth company,
+as defined in the JOBS Act. For as long as we are an emerging growth company, unlike other public companies, we will not be required to,
+among other things: (i) provide an auditor s attestation report on management s assessment of the effectiveness of our
+system of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act, (ii) comply with
+any new requirements adopted by the Public Company Accounting Oversight Board requiring mandatory audit firm rotation or a supplement
+to the auditor s report in which the auditor would be required to provide additional information about the audit and the financial
+statements of the issuer, (iii) provide certain disclosures regarding executive compensation required of larger public companies,
+or (iv) hold nonbinding advisory votes on executive compensation and any golden parachute payments not previously approved. In addition,
+the JOBS Act provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of
+the Securities Act for adopting new or revised financial accounting standards. We intend to take advantage of the longer phase-in periods
+for the adoption of new or revised financial accounting standards permitted under the JOBS Act until we are no longer an emerging growth
+company. If we were to subsequently elect instead to comply with these public company effective dates, such election would be irrevocable
+pursuant to the JOBS Act.
+
+ 
+
+We will remain an emerging growth
+company for up to five full fiscal years, although we will lose that status sooner if we have more than $1.235 billion of revenues
+in a fiscal year, have more than $700 million in market value of our Ordinary Shares held by non-affiliates (and have been a public
+company for at least 12 months and have filed one annual report on Form 20-F), or issue more than $1.0 billion of non-convertible
+debt over a three-year period.
+
+ 
+
+To the extent that we rely on
+any of the exemptions available to emerging growth companies, you will receive less information about our executive compensation and internal
+control over financial reporting than issuers that are not emerging growth companies. We cannot predict if investors will find our Ordinary
+Shares less attractive because we will rely on these exemptions. If some investors find our Ordinary Shares to be less attractive as a
+result, there may be a less active trading market for our Ordinary Shares and our share price may be more volatile.
+
+ 
+
+ 37
+
+ 
+
+ 
+
+ 
+
+ENFORCEABILITY OF CIVIL LIABILITIES
+
+ 
+
+Our Company is an exempted company
+incorporated with limited liability under the laws of the Cayman Islands. We are incorporated in the Cayman Islands because of certain
+benefits associated with being a Cayman Islands company, such as political and economic stability, an effective judicial system, a favorable
+tax system, the absence of foreign exchange control or currency restrictions and the availability of professional and support services.
+However, the Cayman Islands has a less developed body of securities laws as compared to the United States and provides less protection
+for investors. In addition, Cayman Islands companies may not have standing to sue before the U.S. federal courts. Our constitutional documents
+do not contain provisions requiring that disputes, including those arising under the securities laws of the United States, between us,
+our officers, directors and shareholders, be arbitrated.
+
+ 
+
+All of our current
+operations are conducted outside of the United States and all of our current assets are located outside of the United States, with
+the majority of our operations and current assets being located in Hong Kong. All of the Directors and Executive Officers of our
+Company and the auditors of our Company reside outside the United States and substantially all of their assets are located outside
+the United States, with each of our officers and directors and director nominees located in Hong Kong. As a
+result, it may not be possible for investors to effect service of process within the United States upon us or any such persons, or
+to enforce in the United States any judgment obtained in the U.S. courts against us or any of such persons, including judgments
+based upon the civil liability provisions of the U.S. securities laws or any U.S. state or territory.
+
+ 
+
+We have appointed Puglisi &
+Associates, 850 Library Avenue, Suite 204, Newark, Delaware 19711 as our agent upon whom process may be served in any action brought against
+us under the securities laws of the United States.
+
+ 
+
+Cayman Islands
+
+ 
+
+Harney Westwood & Riegels,
+our counsel as to Cayman Islands law, has advised us that there is uncertainty as to whether the courts of the Cayman Islands would (i)
+recognize or enforce judgments of the U.S. courts obtained against us or our Directors or Executive Officers that are predicated upon
+the civil liability provisions of the U.S. securities laws or any U.S. state; or (ii) entertain original actions brought in the Cayman
+Islands against us or our Directors or Executive Officers that are predicated upon the U.S. securities laws or the securities laws of
+any U.S. state.
+
+ 
+
+We have been advised by Harney
+Westwood & Riegels that although there is no statutory enforcement in the Cayman Islands of judgments obtained in the federal or
+state courts of the United States (and the Cayman Islands are not a party to any treaties for the reciprocal enforcement or recognition
+of such judgments), the Grand Court of the Cayman Islands would recognize as a valid judgment, a final and conclusive judgment in
+personam obtained in the federal or state courts of the United States (the "Foreign Court") against our Company under
+which a debt or definite sum of money is payable (other than a sum of money payable in respect of multiple damages, taxes or other charges
+of a like nature or in respect of a fine or other penalty) or, in certain circumstances, an in personam judgment for non-monetary
+relief, and would give a judgment based thereon provided that (a) such courts had proper jurisdiction over the parties subject to such
+judgment; (b) such courts did not contravene the rules of natural justice of the Cayman Islands; (c) such judgment was not obtained by
+fraud; (d) the enforcement of the judgment would not be contrary to the public policy of the Cayman Islands; (e) no new admissible evidence
+relevant to the action is submitted prior to the rendering of the judgment by the courts of the Cayman Islands; and (f) there is due
+compliance with the correct procedures under the laws of the Cayman Islands. The Grand Court of the Cayman Islands will exercise its
+discretion in the enforcement of non-money judgments by having regard to the circumstances, such as considering whether the principles
+of comity apply. To be treated as final and conclusive, any relevant judgment must be regarded as res judicata by the Foreign Court.
+A debt claim on a foreign judgment must be brought within six years of the date of the judgment, and arrears of interest on a judgment
+debt cannot be recovered after six years from the date on which the interest was due. However, the Cayman Islands courts are unlikely
+to enforce a judgment obtained from United States courts under civil liability provisions of the U.S. federal securities law if such
+judgment is determined by the courts of the Cayman Islands to give rise to obligations to make payments that are penal or punitive in
+nature. Because such a determination has not yet been made by a court of the Cayman Islands, it is uncertain whether such civil liability
+judgments from U.S. courts would be enforceable in the Cayman Islands. A Cayman Islands court may stay enforcement proceedings if concurrent
+proceedings are being brought elsewhere. A judgment entered in default of appearance by a defendant who has had notice of the Foreign
+Court s intention to proceed may be final and conclusive notwithstanding that the Foreign Court has power to set aside its own
+judgment and despite the fact that it may be subject to an appeal the time-limit for which has not yet expired. The Grand Court of the
+Cayman Islands may safeguard the defendant s rights by granting a stay of execution pending any such appeal and may also grant
+interim injunctive relief as appropriate for the purpose of enforcement. 
+
+ 
+
+Hong Kong
+
+ 
+
+Cheung,
+Yeung & Lee, Solicitors, our counsel as to Hong Kong law, has advised us that there is currently no treaties or arrangement providing
+for the reciprocal enforcement of judgements between Hong Kong and the United States, as such judgments of United States courts will not
+be directly enforced in Hong Kong. However, foreign judgments can be enforced under the Foreign Judgments (Reciprocal Enforcement) Ordinance
+(Cap. 319 of the Laws of Hong Kong) or under common law. Foreign judgments can be enforced through a statutory registration scheme under
+the Foreign Judgments (Reciprocal Enforcement) Ordinance based on reciprocal recognition of judgment between Hong Kong and the foreign
+courts. However, the United States is not a designated country under the Foreign Judgments (Reciprocal Enforcement) Ordinance. As a result,
+a judgment rendered by a court in the United States, including as a result of administrative actions brought by regulatory authorities
+such as the SEC, and other actions, cannot be registered and may only be enforced at common law.
+
+ 
+
+There
+is uncertainty as to whether the courts of Hong Kong would: (i) recognize or enforce judgments of United States courts obtained against
+us or our directors or officers predicated upon the civil liability provisions of the securities laws of the United States or any state
+in the United States; or (ii) entertain original actions brought in Hong Kong against us or our directors or officers predicated upon
+the securities laws of the United States or any state in the United States. Our Board is comprised of directors, all executive directors
+are located in Hong Kong. The [head of] directors are [Mr. Jerry Chan Chi Wai], a member of our board of directors is also our Chief Executive
+Officer.
+
+ 
+
+ 38
+
+ 
+
+ 
+
+ 
+
+USE OF PROCEEDS
+
+ 
+
+We
+expect to receive approximately US$7,850,000 of net proceeds from this offering after deducting underwriting discounts and commissions
+of US$750,000, non-accountable expense allowance of US$150,000, and estimated offering expenses of approximately US$1,250,000
+payable by us. We will not receive any proceeds from the sale of the Class A Ordinary Shares by the Selling Shareholders.
+
+ 
+
+We
+plan to use the net proceeds we receive from this offering for the following purposes:
+
+ 
+
+ 
+ 
+ 
+ approximately
+ 25% or US$1,962,500 for operation expenses;
+
+ 
+ 
+
+ 
+ 
+ 
+ approximately
+ 25% or US$1,962,500 for marketing expenses;
+
+ 
+ 
+
+ 
+ 
+ 
+ approximately
+ 10% or US$785,000 for capital assets expenditures in the ordinary course of business;
+
+ 
+ 
+
+ 
+ 
+ 
+ approximately
+ 20% or US$1,570,000 for the repayment of the following loans:
+
+ 
+ 
+
+ 
+ 
+ 
+ A
+ HK$2 million loan borrowed by MediaOn Limited from JL Investments Capital Limited pursuant to a Loan Agreement dated January
+ 24, 2025 which bears interest at a rate of 2% per month and is due and payable one year from the draw down date of the loan; and
+
+ 
+
+ 
+
+ 
+ 
+ 
+ 7
+ promissory notes in the aggregate principal amount of US$700,000 with various parties that bear interest at a rate of 30% per annum
+ and are due and payable on various maturity dates between December 20, 2025 and July 7, 2026.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ approximately
+ 3.0% or US$200,000 for indemnity escrow with the underwriter for 12 months; and
+
+ 
+ 
+
+ 
+ 
+ 
+ the
+ remaining balance for general working capital and corporate purposes that are beneficial in developing the business and its
+ strategic direction.
+
+ 
+ 
+
+None of the net proceeds are
+intended to be used to reduce or retire the balance of any loan or credit facility extended by any of the underwriters.
+
+ 
+
+The foregoing represents our current
+intentions based upon our present plans and business conditions to use and allocate the net proceeds of this offering. Our management,
+however, will have significant flexibility and discretion to apply the net proceeds of this offering. If an unforeseen event occurs, or
+business conditions change, we may use the proceeds of this offering differently than as described in this prospectus. See "Risk
+Factors."
+
+ 
+
+To the extent that the net proceeds
+of this offering are not immediately applied for the above purposes, we plan to invest the net proceeds in short-term interest-bearing
+obligations, investment-grade instruments, or certificates of deposit.
+
+ 
+
+ 39
+
+ 
+
+ 
+
+ 
+
+CAPITALIZATION
+
+ 
+
+The
+following table sets forth our capitalization as of March 31, 2025:
+
+ 
+
+ 
+ 
+ 
+ on an actual basis; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ on a pro forma as adjusted basis to reflect (i)
+ the above; (ii) the issuance and sale of 2,000,000 Class A Ordinary Shares in this offering at an initial public offering
+ price of US$[5] per Class A Ordinary Shares (being the mid-point of the offer price range), after deducting underwriting discounts
+ and estimated offering expenses payable by us.
+
+ 
+ 
+
+The pro
+forma as adjusted information below is illustrative only, and our capitalization following the completion of this offering is subject
+to adjustment based on the actual net proceeds to us from the offering. You should read this table in conjunction with "Use of Proceeds,"
+"Management s Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial
+statements and related notes included elsewhere in this prospectus.
+
+ 
+
+ 
+ 
+ As at March 31, 2025 
+
+ 
+ Shareholders Equity 
+ Actual 
+ As adjusted 
+
+ 
+ 
+ US$ 
+ US$ 
+
+ 
+ 233,500,000 Class A Ordinary Shares authorized, par value US$0.0002 per share,
+ 3,500,000 Class A Ordinary Shares issued and outstanding on an actual basis, and 5,500,000 Class A Ordinary Shares
+ issued and outstanding on an as adjusted basis 
+ 700 
+ - 
+
+ 
+ 16,500,000 shares of Class B Ordinary shares authorized(1), par value US$0.0002 per
+ share, 16,500,000 Class B Ordinary Shares issued and outstanding on an actual basis, and 16,500,000 Class B Ordinary Shares issued
+ and outstanding on an as adjusted basis 
+ 3,300 
+ - 
+
+ 
+ Additional paid-in capital 
+ 69,300 
+ - 
+
+ 
+ Subscription receivable 
+ (70,000) 
+ - 
+
+ 
+ Accumulated losses and other comprehensive losses 
+ (2,270,296) 
+ - 
+
+ 
+ Total Shareholders Equity (Deficit) 
+ (2,266,996) 
+ - 
+
+ 
+ Minority Interests 
+ 579 
+ - 
+
+ 
+ Total Equity (Deficit) 
+ (2,266,417) 
+ - 
+
+ 
+ 
+ 
+ 
+
+ 
+ Indebtedness 
+ 
+ 
+
+ 
+ Bank borrowings 
+ 1,089,177 
+ - 
+
+ 
+ Promissory notes and loan 
+ 957,073 
+ - 
+
+ 
+ Total Indebtedness 
+ 2,046,250 
+ - 
+
+ 
+ Total Capitalization 
+ (220,167) 
+ - 
+
+ 
+
+ 
+
+(1)Upon
+ completion of this offering, the largest shareholder of our company, Tech Vision Investments
+ Limited, controlled by Jimmy Shu Wai Chan as the owner of 16,500,000 Class B Ordinary Shares,
+ will beneficially own 98.36% of the total aggregate voting power, assuming that the underwriters
+ do not exercise their over-allotment option.
+
+ 
+
+ 40
+
+ 
+
+ 
+
+ 
+
+DIVIDEND POLICY
+
+ 
+
+When considering the distribution
+of a dividend in the future, our Board shall take into account, among other things, the following factors when deciding whether to propose
+a dividend and in determining the dividend amount: (a) operating and financial results; (b) cash flow situation; (c) business conditions
+and strategies; (d) future operations and earnings; (e) taxation considerations; (f) interim dividend paid, if any; (g) capital requirement
+and expenditure plans; (h) interests of shareholders; (i) statutory and regulatory restrictions; (j) any restrictions on payment of dividends;
+and (k) any other factors that our Board may consider relevant. The payment of dividends, in certain circumstances is also subject to
+the approval of our Shareholders, the Companies Act and our Amended and Restated Memorandum and Articles of Association as well as any
+other applicable laws. Currently, we do not have any predetermined dividend distribution ratio.
+
+ 
+
+Under Cayman Islands law, a Cayman
+Islands company may pay a dividend out of either profit, retained earnings, or share premium account, provided that in no circumstances
+may a dividend be paid if this would result in our Company being unable to pay its debts as they fall due in the ordinary course of business.
+If our Board decides to pay dividends, the form, frequency and amount will depend upon our future operations and earnings, capital requirements
+and surplus, general financial condition, contractual restrictions and other factors that the Board may deem relevant. In addition, we
+are a holding company and depend on the receipt of dividends and other distributions from our subsidiaries to pay dividends on our shares.
+
+ 
+
+There are no foreign exchange
+controls or foreign exchange regulations under current applicable laws of the various places of incorporation of our significant subsidiaries
+that would affect the payment or remittance of dividends.
+
+ 
+
+ 41
+
+ 
+
+ 
+
+ 
+
+DILUTION
+
+ 
+
+Investors purchasing our shares
+in this offering will experience immediate and substantial dilution in the pro forma as adjusted net tangible book value of their shares.
+Dilution in pro forma as adjusted net tangible book value represents the difference between the initial public offering price of our shares
+and the pro forma as adjusted net tangible book value per share of our shares immediately after the offering.
+
+ 
+
+Historical net tangible book
+value per share as of March 31, 2025 represents our total tangible assets of US$2,306,139 (total assets of US$2,941,834
+excluding deferred IPO costs of US$453,834 and ROU assets of US$181,861) less total liabilities, net of US$5,156,184 (total
+liabilities of US$5,208,251 excluding deferred tax liabilities of US$52,067), divided by the number of outstanding shares before
+this offering of 20 million Ordinary Shares. After giving effect to the sale of shares in this offering by our Company at an initial
+public offering price of US$[5.00] per share, after deducting US$[0.375] in underwriting discounts and commissions, US$[0.075] in non-accountable
+expense allowance and estimated offering expenses payable by our Company of approximately US$1,250,000, the pro forma as adjusted net
+tangible book value as of March 31, 2025 would have been approximately US$$4,999,955, or US$0.23 per share. This represents an
+immediate increase in pro forma as adjusted net tangible book value of US$0.37 per share to our existing stockholders and an immediate
+dilution of US$4.77 per share to new investors purchasing shares in this offering.
+
+ 
+
+The following table illustrates
+this dilution on a per Share basis to new investors.
+
+ 
+
+ 
+ 
+ 
+ 
+ US$
+ 
+
+ 
+ Assumed initial public offering price per share
+ 
+ 
+ 5.00
+ 
+
+ 
+ Historical net tangible book value per share as of March 31, 2025
+ 
+ 
+ (0.14
+ )
+
+ 
+ Increase in as adjusted net tangible book value per Share attributable to the investors in this offering
+ 
+ 
+ 0.37
+ 
+
+ 
+ Pro forma net tangible book value per share after giving effect to this offering
+ 
+ 
+ 0.23
+ 
+
+ 
+ Dilution per Share to new investors participating in this offering
+ 
+ 
+ 4.77
+ 
+
+ 
+ 
+
+ 42
+
+ 
+
+ 
+
+ 
+
+SUMMARY CONSOLIDATED FINANCIAL
+AND OTHER DATA
+
+ 
+
+The
+following unaudited consolidated financial data as of March 31, 2025 and 2024 for the six months ended March 31, 2025 and 2024; and
+the consolidated financial data as of September 30, 2024 and 2023 for the financial years ended September 30, 2024 and 2023 have
+been derived from our audited consolidated financial statements included elsewhere in this prospectus. The summary financial data set
+forth below should be read in conjunction with, and are qualified by reference to, "Selected Consolidated Financial and Other Data,"
+"Management s Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial
+statements and notes thereto included elsewhere in this prospectus. Our consolidated financial statements are prepared and presented
+in accordance with U.S. GAAP. Our historical results do not necessarily indicate results expected for any future period.
+
+ 
+
+ 
+ 
+ For
+ the six months ended
+ March
+ 31,
+ 
+
+ 
+ 
+ 2025 
+ 2024 
+
+ 
+ 
+ (Unaudited) 
+ (Unaudited) 
+
+ 
+ Selected Consolidated Statements of Operations Data: 
+ 
+ 
+
+ 
+ Revenue 
+ $823,618 
+ $1,277,824 
+
+ 
+ Revenue-Related party 
+ 5,305 
+ 9,912 
+
+ 
+ Total Revenue 
+ 828,923 
+ 1,287,736 
+
+ 
+ Cost of revenues 
+ (320,489) 
+ (393,848)
+
+ 
+ Cost of revenues-Related Party 
+ (5,642) 
+ (693)
+
+ 
+ Marketing expenses 
+ (16,140) 
+ (203,703)
+
+ 
+ General and administrative expense 
+ (594,604) 
+ (416,551)
+
+ 
+ General and administrative expenses-Related Party 
+ (78,114) 
+ (99,588)
+
+ 
+ Operating profit 
+ (186,066) 
+ 173,353 
+
+ 
+ Interest income 
+ 111 
+ 1,323 
+
+ 
+ Sundry expenses 
+ (9,101) 
+ (21,846)
+
+ 
+ Interest expenses 
+ (141,730) 
+ (66,485)
+
+ 
+ Exchange (loss) gain 
+ 3,163 
+ (3,652)
+
+ 
+ Total other expenses, net 
+ (147,557) 
+ (90,660)
+
+ 
+ (Loss) Profit before taxes 
+ (333,623) 
+ 82,693 
+
+ 
+ Provision for income taxes 
+ (16,241) 
+ (15,151)
+
+ 
+ Equity Income in investee 
+ 16,083 
+ - 
+
+ 
+ Net (loss) income attributable to MediaOn Group Inc. 
+ $(333,781) 
+ $67,542 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net (loss) income per share Class A Ordinary Shares, basis and diluted* 
+ $(0.02) 
+ $- 
+
+ 
+ Net (loss) income per share Class B Ordinary Shares, basis and diluted* 
+ $(0.02) 
+ $0.00 
+
+ 
+ Basic and diluted weighted average shares outstanding 
+ 
+ 
+
+ 
+ Class A Ordinary Shares* 
+ 3,500,000 
+ - 
+
+ 
+ Class B Ordinary Shares* 
+ 16,500,000 
+ 16,500,000 
+
+ 
+
+ 
+
+ 
+ 
+ For the years ended
+ September 30,
+ 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ Selected Consolidated Statements of Operations Data: 
+ 
+ 
+
+ 
+ Revenue 
+ $2,777,281 
+ $3,941,655 
+
+ 
+ Revenue-Related party 
+ 27,094 
+ 24,460 
+
+ 
+ Total Revenue 
+ 2,804,375 
+ 3,966,115 
+
+ 
+ Cost of revenues 
+ (1,168,851) 
+ (1,653,627)
+
+ 
+ Cost of revenues-Related Party 
+ (1,522) 
+ (7,683)
+
+ 
+ Marketing expenses 
+ (213,063) 
+ (16,835)
+
+ 
+ General and administrative expense 
+ (1,137,313) 
+ (958,543)
+
+ 
+ General and administrative expenses-Related Party 
+ (177,403) 
+ (247,127)
+
+ 
+ Operating profit 
+ 106,223 
+ 1,082,300 
+
+ 
+ Government Subsidy 
+ - 
+ 16,934 
+
+ 
+ Interest income 
+ 1,980 
+ 1,308 
+
+ 
+ Sundry (expenses) income 
+ (21,859) 
+ 518 
+
+ 
+ Interest expenses 
+ (197,353) 
+ (21,652)
+
+ 
+ Exchange (loss) gain 
+ (3,713) 
+ 4,773 
+
+ 
+ Total other (expenses) incomes, net 
+ (220,945) 
+ 1,881 
+
+ 
+ Profit before taxes 
+ (114,722) 
+ 1,084,181 
+
+ 
+ Provision for income taxes 
+ (50,381) 
+ (23,275)
+
+ 
+ Net (loss) income attributable to MediaOn Group Inc. 
+ $(165,103) 
+ $1,060,906 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net (loss) income per share Class A Ordinary Shares, basis and diluted* 
+ $(0.01) 
+ $- 
+
+ 
+ Net (loss) income per share Class B Ordinary Shares, basis and diluted* 
+ $(0.01) 
+ $0.06 
+
+ 
+ Basic and diluted weighted average shares outstanding 
+ 
+ 
+
+ 
+ Class A Ordinary Shares* 
+ 604,110 
+ - 
+
+ 
+ Class B Ordinary Shares* 
+ 16,500,000 
+ 16,500,000 
+
+ 
+
+ 
+
+*On
+September 1, 2025, the Company effected a reverse stock split (the" Reverse Stock Split") of the Company s issued and
+outstanding Ordinary Shares at a split ratio of 1-for-2 such that every holder of Class A and Class B Ordinary Shares shall receive one
+share for every two shares of Ordinary Shares held. All references to number of shares and to per share information have been retroactively
+adjusted.
+
+ 
+
+The following table presents
+our selected consolidated balance sheet data.
+
+ 
+
+ 
+ 
+ As of 
+
+ 
+ 
+ March
+ 31, 
+ 2025
+ 
+ September
+ 30.
+ 2024
+ 
+
+ 
+ 
+ (Unaudited) 
+ 
+
+ 
+ Selected Consolidated Balance Sheet Data: 
+ 
+ 
+
+ 
+ Cash 
+ $88,448 
+ $186,684 
+
+ 
+ Total current assets 
+ 1,114,463 
+ 1,203,133 
+
+ 
+ Total non-current assets 
+ 1,827,371 
+ 1,960,395 
+
+ 
+ TOTAL ASSETS 
+ $2,941,834 
+ $3,163,528 
+
+ 
+ Total current liabilities 
+ $3,693,965 
+ 3,362,904 
+
+ 
+ Total non-current liabilities 
+ 1,514,286 
+ 1,734,852 
+
+ 
+ TOTAL LIABILITIES 
+ $5,208,251 
+ $5,097,756 
+
+ 
+ TOTAL SHAREHOLDERS DEFICIT 
+ $(2,266,996) 
+ $(1,934,807)
+
+ 
+ Non-controlling interest 
+ 579 
+ 579 
+
+ 
+
+ 
+
+ 
+ 
+ As of 
+ September 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ Selected Consolidated Balance Sheet Data: 
+ 
+ 
+
+ 
+ Cash 
+ $186,684 
+ $649,067 
+
+ 
+ Total current assets 
+ 1,203,133 
+ 2,000,850 
+
+ 
+ Total non-current assets 
+ 1,960,395 
+ 3,016,304 
+
+ 
+ TOTAL ASSETS 
+ $3,163,528 
+ $5,017,154 
+
+ 
+ Total current liabilities 
+ $3,362,904 
+ 3,295,976 
+
+ 
+ Total non-current liabilities 
+ 1,734,852 
+ 3,480,729 
+
+ 
+ TOTAL LIABILITIES 
+ $5,097,756 
+ $6,776,705 
+
+ 
+ TOTAL SHAREHOLDERS DEFICIT 
+ $(1,934,807) 
+ $(1,759,551)
+
+ 
+ Non-controlling interest 
+ 579 
+ - 
+
+ 
+
+ 
+
+The following table presents our selected consolidated
+statement of cash flow.
+
+ 
+
+ 
+ 
+ For the six months ended 
+ March
+ 31, 
+
+ 
+ 
+ 2025 
+ 2024 
+
+ 
+ 
+ (Unaudited) 
+ (Unaudited) 
+
+ 
+ Selected Consolidated Statements of Cash Flows Data: 
+ 
+ 
+
+ 
+ Net cash used in operating activities 
+ $(100,834) 
+ $(1,089,165)
+
+ 
+ Net cash used in investing activities 
+ (1,088) 
+ (3,985)
+
+ 
+ Net cash provided by financing activities 
+ 3,902 
+ 575,085 
+
+ 
+ Effect of exchange translation 
+ (216) 
+ 688 
+
+ 
+ Net (decrease) increase in cash and cash equivalents 
+ (98,236) 
+ (517,377)
+
+ 
+ Cash, beginning of period 
+ 186,684 
+ 649,067 
+
+ 
+ Cash, end of period 
+ $88,448 
+ $131,690 
+
+ 
+ Supplementary cash flow information: 
+ 
+ 
+
+ 
+ Taxes paid 
+ $- 
+ $- 
+
+ 
+ Interest paid 
+ $37,018 
+ $32,458 
+
+ 
+
+ 
+
+ 
+ 
+ For the years ended 
+ September 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ Selected Consolidated Statements of Cash Flows Data: 
+ 
+ 
+
+ 
+ Net cash used in operating activities 
+ $(960,540) 
+ $(118,582)
+
+ 
+ Net cash used in investing activities 
+ (6,194) 
+ (5,419)
+
+ 
+ Net cash provided by financing activities 
+ 479,422 
+ 409,669 
+
+ 
+ Effect of exchange translation 
+ 24,929 
+ 891 
+
+ 
+ Net (decrease) increase in cash and cash equivalents 
+ (462,383) 
+ 286,559 
+
+ 
+ Cash, beginning of year 
+ 649,067 
+ 362,508 
+
+ 
+ Cash, end of year 
+ $186,684 
+ $649,067 
+
+ 
+ Supplementary cash flow information: 
+ 
+ 
+
+ 
+ Taxes paid 
+ $- 
+ $- 
+
+ 
+ Interest paid 
+ $66,093 
+ $21,652 
+
+ 
+
+ 
+
+ 43
+
+ 
+
+ 
+
+ 
+
+MANAGEMENT S DISCUSSION AND ANALYSIS OF
+
+FINANCIAL CONDITION AND RESULTS OF OPERATIONS
+
+ 
+
+The following discussion and analysis of our results
+of operations and financial condition should be read together with our unaudited condensed consolidated financial statements and the notes
+thereto and other financial information, which are included elsewhere in this registration statement. Our financial statements have been
+prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP"). In addition, our financial statements
+and the financial information included in this registration statement reflect our organizational transactions and have been prepared as
+if our current corporate structure had been in place throughout the relevant periods.
+
+ 
+
+This section contains forward-looking statements.
+These forward-looking statements are subject to various factors, risks and uncertainties that could cause actual results to differ materially
+from those reflected in these forward-looking statements. Further, as a result of these factors, risks and uncertainties, the forward-looking
+events may not occur. Relevant factors, risks and uncertainties include, but are not limited to, those discussed in the section entitled
+"Business," "Risk Factors" and elsewhere in this registration statement. Readers are cautioned not to place undue
+reliance on forward-looking statements, which reflect management s beliefs and opinions as of the date of this registration statement.
+We are not obligated to publicly update or revise any forward-looking statements, whether as a result of new information, future events
+or otherwise. See "Cautionary Note Regarding Forward-Looking Statements."
+
+ 
+
+Overview
+
+ 
+
+Headquartered in Hong Kong, we are a Cayman Islands
+exempted company with limited liability incorporated on March 20, 2024, as a holding company of our business, which is primarily operated
+through our Hong Kong Operating Subsidiaries.
+
+ 
+
+Founded in 2011, our company manages a network of
+digital media which create and publish contents to internet search engine and social media platforms such as Yahoo, Google, Facebook,
+YouTube, Instagram, LinkedIn and Little Red Book, and online to offline ("O2O") events for various clients from non-governmental
+organization ("NGO") to small and medium enterprises ("SME"). We also provide our clients artificial intelligent
+interactive and multimedia creations. Additionally, we will provide customized media services which includes digital outdoor marketing.
+
+ 
+
+Our business provides value to our major business
+customers.
+
+ 
+
+ 
+ 
+ 
+ Client-Centric: We prioritize our clients needs and goals, fostering long-term partnerships built on trust and mutual respect.
+
+ 
+ 
+
+ 
+ 
+ 
+ Data-Driven: We leverage data insights and analytics to inform strategic decision-making and optimize campaign performance.
+
+ 
+ 
+
+ 
+ 
+ 
+ Innovation: We embrace new technologies and trends, continuously evolving our approach to stay ahead of the curve.
+
+ 
+ 
+
+ 
+ 
+ 
+ Results-Oriented: We are committed to delivering measurable outcomes that align with our clients business objectives.
+
+ 
+ 
+
+ 
+ 
+ 
+ Teamwork: We cultivate a collaborative and supportive environment where diverse perspectives and expertise converge to achieve shared goals.
+
+ 
+ 
+
+ 44
+
+ 
+
+ 
+
+ 
+
+To achieve client satisfaction, we have developed
+a diverse service portfolio for China, Hong Kong and east Asia:
+
+ 
+
+ 
+ 
+ 
+ Social Media Marketing: (i) strategic media planning; (ii) social media platform maintenance; (iii) social media advertisement placement; (iv) creative contents; (v) KOL marketing; (vi) social media listening tools; (vii) chatbots; and (viii) forum seeding.
+
+ 
+ 
+
+ 
+ 
+ 
+ Search Engine & Media Buy: (i) search engine marketing; (ii) creative design; (iii) display advertising; (iv) data driven marketing; (v) programmatic buy; and (vi) video marketing.
+
+ 
+ 
+
+ 
+ 
+ 
+ Global Marketing: We also help clients in markets other than
+ Hong Kong in (i) market research and analysis; (ii) multilingual marketing campaigns; (iii) global branding and positioning;
+ and (iv) international digital marketing.
+
+ 
+
+ 
+
+Factors Affecting Our Results of Operations and
+Trend Information
+
+ 
+
+Our results of operations are affected by factors
+driving client marketing spendings and consumers online activities, including the following:
+
+ 
+
+ 
+ 
+ 
+ Media Spending Fluctuations
+
+ 
+ 
+
+We earn agency fees for media spending from clients
+to promote and sell their brands, products and services. Their willingness to spend their marketing budget through us is critical to our
+ability to generate revenue.
+
+ 
+
+Marketing spending can be influenced by a variety
+of factors, including the following:
+
+ 
+
+ 
+ 
+ (i)
+ Domestic, regional, and global social, economic, and political conditions such as concerns over a severe or prolonged slowdown in HKSAR, changes in Taiwan s economy, or threats of political unrest; economic and geopolitical challenges such as trade disputes between the United States and China; or economic, monetary, and fiscal policies such as the introduction and winding-down of qualitative easing programs.
+
+ 
+ 
+
+ 
+ 
+ (ii)
+ Industry-related factors such as the trends, preferences, and habits of consumers regarding social media platforms and their receptiveness to influencer marketing, as well as the development of emerging and varying forms of solutions.
+
+ 
+ 
+
+ 
+ 
+ (iii)
+ Brand-specific factors such as a brand s specific development strategies, business performance, financial condition, and sales and marketing plans.
+
+ 
+ 
+
+Changes in any of the above factors may result in
+significant cutbacks on marketing budgets by our clients, which would not only reduce our revenue from agency fees but also weaken our
+negotiating position with search engines, social media platforms on pricing policies.
+
+ 
+
+ 
+ 
+ 
+ Impact of COVID-19 
+
+ 
+ 
+
+Our business may be adversely affected by epidemics
+or pandemics.
+
+ 
+
+ 45
+
+ 
+
+ 
+
+ 
+
+Between 2020 and 2023, the COVID-19 pandemic created
+uncertainties and risks. Going forward, we do not expect a significant negative impact on our operations and financial results in the
+long run. However, because of the impossibility of accurately predicting the duration or intensity of any pandemic outbreak, the related
+risks of business disruptions and negative financial impacts cannot be reasonably estimated at this time.
+
+ 
+
+ 
+ 
+ 
+ Seasonality 
+
+ 
+ 
+
+Except for NGO, we experience seasonal fluctuations
+in revenue. The first and fourth quarter of each calendar year generally contributes the largest portion of our annual revenue because
+clients tend to allocate a significant portion of their marketing budget to those quarters, which coincides with consumers increased
+purchases around the holidays and shopping events in those quarters, such as Christmas in December and Chinese new year in late January
+and early February.
+
+ 
+
+The third quarter of each calendar year generally
+contributes the smallest portion of our revenue, primarily because clients spend less money when commercial activity slows down during
+the school opening season. We expect our revenue to continue fluctuating based on seasonal factors that affect clients marketing
+spending and consumers online purchases.
+
+ 
+
+ 
+ 
+ 
+ Our Ability to Optimize Our Client Base and Increase Client Spending
+
+ 
+ 
+
+Our growth and profitability depend upon our ability
+to optimize our client base and increase clients marketing spending on our services. We initiated a comprehensive review of our
+client base in 2022 and terminated relationships with clients who had relatively long account receivable cycles and yielded relatively
+low operating profit margins. We have strengthened our relationships with direct clients, which tend to command higher gross profit margins
+than agency clients. Our growth and profitability also depend on our ability to attract more clients and to further diversify our client
+base to capture growth of industry verticals and geographic markets. Our ability to increase clients marketing spend with us depends
+on whether our solutions can effectively address clients evolving and diverse needs in a cost-efficient manner. To that end, we
+develop and offer tailor-made, innovative, and user-friendly solutions and services that will enhance our sales, marketing, and project
+management.
+
+ 
+
+ 
+ 
+ 
+ Our Ability to Grow Our Online to Offline Business
+
+ 
+ 
+
+Our growth area is online to offline ("O2O"),
+which primarily involves online promotion and offline event for clients who want to build their own online media presents while an offline
+promotion event. This is a change of clients combine both digital media and our AI interactive event. Our placements in social
+media to capture target audiences accomplishing with an offline event has a proved effectiveness for clients promotional campaigns.
+We believe this O2O model will create more client needs in the future.
+
+ 
+
+ 46
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Our Ability to Enrich Our Business Models
+
+ 
+ 
+
+By leveraging our expertise in the digital media and
+creative team, we can react quickly to market trends and business potential faster than our competitors. We must enrich our service combinations
+to evolve more business models.
+
+ 
+
+ 
+ 
+ 
+ Our Ability to Successfully Extend and Operate Our Business in Asia and China
+
+ 
+ 
+
+Almost all of our revenues are generated from clients
+in HKSAR. We plan to extend our media geographical coverage which can serve our clients better and increase our revenue.
+
+ 
+
+ 
+ 
+ 
+ Our Ability to Innovate
+
+ 
+ 
+
+Our ability to innovate and introduce new value-added
+application with improved artificial intelligence and marketing know-how is key to better serving our clients by improving their return
+on investment of media spendings and helping our clients to enhance reaching rate of their target market segments/customers.
+
+ 
+
+ 
+ 
+ 
+ Our Ability to Manage Growth, Control Costs, and Manage Working Capital
+
+ 
+ 
+
+Our expansion into new areas will increase demands
+on our management, operational, technological, financial, and other resources. Our effectiveness in controlling costs and managing working
+capital is key to our success. Our continued success depends on our ability to leverage our scale to obtain better credit terms and faster
+payment from our Brands, marketplaces, platform partners, service providers, and product suppliers.
+
+ 
+
+Results of Operations
+
+ 
+
+For
+the six months ended March 31, 2025, and 2024
+
+ 
+
+Revenue
+
+ 
+
+Revenues
+are classified into:
+
+ 
+
+ 
+
+ 
+ Marketing
+ Campaigns
+
+ 
+ 
+
+Services
+consist of social media marketing; AI and interactive; multimedia creation; and event management. Revenue is recognized upon completion
+of different deliverables.
+
+ 
+
+ 
+
+ 
+ Media
+ Placements
+
+ 
+ 
+
+Services
+include media placements on search engines or social platforms via third-party media suppliers. The Company acts as an agent and recognizes
+revenue as commission (media placement revenue net of media costs) when media is placed.
+
+ 
+
+ 
+
+ 
+ Media
+ Rebates
+
+ 
+ 
+
+Revenue
+from media suppliers when media placement volume thresholds are met. Rebates range from 20% to 30% depending on media spendings. Revenue
+is recognized when media is scheduled and non-cancellable.
+
+ 
+
+We
+primarily generate our revenue from (i) marketing campaigns; (ii) media placement; (iii) rebate income. Except for item (ii), we recognize
+all our revenue on a gross basis, comprising:
+
+ 
+
+ 
+ (i)
+ marketing
+ campaigns for (a) service fees from clients and advertising revenue for social media platforms, which is the budgeted amount for
+ each promotional campaign paying by clients; (b) events base campaigns are paid by clients for a pre-determined sum for the whole
+ event management, but media costs for this category are recognized netted, revenue recognized upon the completion of the event;
+
+ 
+ (ii)
+ we
+ earn a pre-determined agency fee to place online advertisements for clients;
+
+ 
+ (iii)
+ media
+ rebates are earned from contract with media platform for a placement sum commitment. The placement sums are from our placements for
+ clients and placements by our co-operation agents. This placement sum commitment refers to a contractual spending goal agreed
+ between MediaOn and the media platform, whereby:
+
+ 
+ 
+ 
+
+ 
+ 
+ MediaOn
+ agrees (or expects, based on historical volumes) to route a certain amount of advertising
+ expenditure through the platform
+
+ The platform, in return, offers tiered
+rebates based on actual accumulated spendings.
+
+ 
+
+In the section of "Business", there will have a detailed explanation about the media rebates.
+
+ 
+ 
+
+We
+primarily generate our revenue from (i) campaign-based digital marketing; (ii) search engine optimization (SEO); (iii) media placement;
+(iv) online to offline (O2O) event; (v) rebate income; and (vi) others such as creative and web designs. Except for item (iii), we recognize
+all our revenue on a gross basis, comprising (i) campaign-based digital marketing for service fees from clients and advertising revenue
+for social media platforms, which is the budgeted amount for each promotional campaign paying by clients; and (ii) search engine optimization,
+which is the budgeted amount paying by client to reach a better position for clients link in search engine result; (iii) we earn
+a pre-determined agency fee to place online advertisements for clients; (iv) events are paid by clients for a pre-determined sum for
+the whole event management, but media costs for this category are recognized netted; (v) media rebates are earned from contract with
+media platform for a placement sum commitment. The placement sums are from our placements for clients and placements by our co-operation
+agents; and (vi) the other categories of revenue are recognized by the percentage of completion.
+
+ 
+
+We
+analyze both revenue and gross profits to evaluate our business. As there is few statistics for our industry in Hong Kong is relatively,
+we evaluate our market share by searching information from our peers competitors or clients. We review our net income to measure our
+performance, identify trends affecting our business; establish our budgets, measure the effectiveness of sales and marketing, and determine
+our operational performance.
+
+ 
+
+ 47
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ For
+ the six months ended
+ March
+ 31,
+ 
+ Changes 
+
+ 
+ 
+ 2025
+ USD 
+ % to Revenue 
+ 2024 
+ USD 
+ % to Revenue 
+ USD 
+ % 
+
+ 
+ 
+ (Unaudited) 
+ 
+ (Unaudited) 
+ 
+ 
+ 
+
+ 
+ Marketing Campaigns 
+ 408,408 
+ 49.27 
+ 298,597 
+ 23.19 
+ 109,811 
+ 36.78 
+
+ 
+ Media Placements 
+ 121,980 
+ 14.72 
+ 120,342 
+ 9.34 
+ 1,638 
+ 1.36 
+
+ 
+ Media Rebates 
+ 298,535 
+ 36.01 
+ 868,797 
+ 67.47 
+ (570,262) 
+ (65.64)
+
+ 
+ Total 
+ 828,923 
+ 100.00 
+ 1,287,736 
+ 100.00 
+ (458,813) 
+ (35.63)
+
+ 
+
+ 
+
+During
+the six months ended March 31, 2025, we recorded revenue of approximately $829,000, representing a decrease of 35.63% from revenue of
+approximately $1,288,000 for the six months ended March 31, 2024. The decrease in revenue was mainly attributable to decreased revenue
+from our media rebates due to the progress of merger and acquisition of our major media placing platform.
+
+ 
+
+Revenue
+derived from marketing campaigns was approximately $408,000 for the six months ended March 31, 2025, compared with approximately $299,000
+for the six months ended March 31, 2024, representing an increase of 36.78%. This was due to our clients have spent higher to capture
+the market opportunities after the release of gathering prohibition after COVID-19. This was led by the continuous effect of overall
+economic resumption from 2023 was not reacted as expected so general public had a tendency to hold consumptions to prevent a sudden outbreak
+of COVID-19 again. Thus, our clients have tried to increase digital media spending a little bit higher to test reactions of the market.
+
+ 
+
+Revenue
+derived from media placement, or agency fees, was approximately $122,000 for the six months ended March 31, 2025, compared with approximately
+$120,000 for the six months ended March 31, 2024, representing a slightly increase of 1.36%. We believe the cause of increase is in line
+with the cause of marketing campaigns.
+
+ 
+
+Revenue
+derived from media rebate was approximately $299,000 for the six months ended March, 2025 compared with approximately $869,000 for the
+six months ended March 31, 2024, representing a decrease of 65.64%. The decrease was mainly our co-operation third-party media platforms
+have outsourced a segment of digital media spendings to be spent under our contract with digital media during the six months. It is also
+a trend that media spending pattern for SMEs have been shifted to more digital social media focus.
+
+ 
+
+Cost
+of Revenues
+
+ 
+
+ 
+ 
+ For
+ the six months ended
+ March
+ 31,
+ 
+ Changes 
+
+ 
+ 
+ 2025
+ USD
+ 
+ % to Cost of Revenue 
+ 2024
+ USD
+ 
+ % to Cost of Revenue 
+ USD 
+ % 
+
+ 
+ 
+ (Unaudited) 
+ 
+ (Unaudited) 
+ 
+ 
+ 
+
+ 
+ Marketing Campaigns 
+ 230,853 
+ 70.79 
+ 119,586 
+ 30.31 
+ 111,267 
+ 93.04 
+
+ 
+ Media Placements 
+ - 
+ - 
+ - 
+ 
+ - 
+ 
+
+ 
+ Media Rebates 
+ 95,278 
+ 29.21 
+ 274,955 
+ 69.69 
+ (179,677) 
+ (65.35)
+
+ 
+ Total 
+ 326,131 
+ 100.00 
+ 394,541 
+ 100.00 
+ (68,410) 
+ (17.34)
+
+ 
+
+ 
+
+Cost
+of Revenues for the six months ended March 31, 2025 decreased to approximately $326,000 compared with approximately $395,000 for the
+previous fiscal period. The decrease was mainly because of the decrease of our media rebates earned from our own clients and channel
+agents during the six months.
+
+ 
+
+Cost
+of Revenues for marketing campaigns was approximately $231,000 for the six months ended March 31, 2025, compared with approximately $120,000
+for the six months ended March 31, 2024, representing an increase of 93.04%. The increase was mainly associated with an increase outsourced
+services of our business during the six months. We have invested in Mosaic and Common People in order to procure our costs for marketing
+campaigns in the future.
+
+ 
+
+Cost
+of Revenues for media placement was recognized netted that no media buying costs were accounted for.
+
+ 
+
+Cost
+of Revenues for media rebates was approximately $95,000 for the six months ended March 31, 2025, compared with approximately $275,000
+for the six months ended March 31, 2024, representing a decrease of 65.35%. The decrease was primarily the result of the decrease of
+revenue from media rebates.
+
+ 
+
+ 48
+
+ 
+
+ 
+
+ 
+
+Other
+Income, net
+
+ 
+
+ 
+ 
+ For
+ the six months ended
+ March
+ 31
+ 
+ Changes 
+
+ 
+ 
+ 2025 
+ 2024 
+ Amount 
+ % 
+
+ 
+ 
+ (Unaudited) 
+ (Unaudited) 
+ 
+ 
+
+ 
+ Interest income 
+ $111 
+ $1,323 
+ $(1,212) 
+ (91.61)
+
+ 
+ Sundry (expense) incomes 
+ (9,101) 
+ (21,846) 
+ 12,745 
+ 58.34 
+
+ 
+ Interest expenses 
+ (141,730) 
+ (66,485) 
+ (75,245) 
+ (113.18)
+
+ 
+ Exchange (loss) gain 
+ 3,163 
+ (3,652) 
+ 6,815 
+ 186.61 
+
+ 
+ Total 
+ $(147,557) 
+ $(90,660) 
+ $(56,897) 
+ (62.76)
+
+ 
+
+ 
+
+Interest expense primarily was paid on loans we
+obtained from banks and accrued for promissory notes and loan. Interest expense increased by approximately $75,000, or approximately
+1.13 times, from approximately $66,000 for the six months ended March 31, 2024 to approximately $142,000 for the six months ended March
+31, 2025, which was mainly attributable to an increase of $257,000 and $105,000 in secured loan from JL Investments Capital Limited and
+interest accrued in promissory notes, respectively.
+
+ 
+
+Operating
+Expenses
+
+ 
+
+ 
+ 
+ For
+ the six months ended
+ March
+ 31
+ 
+ Changes 
+
+ 
+ 
+ 2025 
+ 2024 
+ Amount 
+ % 
+
+ 
+ 
+ (Unaudited) 
+ (Unaudited) 
+ 
+ 
+
+ 
+ Operating Expenses 
+ 
+ 
+ 
+ 
+
+ 
+ Marketing Expenses 
+ $16,140 
+ $203,703 
+ $(187,563) 
+ (92.08)
+
+ 
+ General and Administrative Expenses – Related parties 
+ 78,114 
+ 99,588 
+ (21,474) 
+ (21.56)
+
+ 
+ General and Administrative Expenses 
+ 594,604 
+ 416,551 
+ 178,053 
+ 42.74 
+
+ 
+ Total 
+ $688,858 
+ $719,842 
+ $(30,984) 
+ (4.3)
+
+ 
+
+ 
+
+Marketing
+expenses for the six months ended March 31, 2025 were approximately $16,000 compared with approximately $204,000 in 2024, representing
+12 times decrease. Such an decrease was mainly attributable to the decreased marketing spendings during the 6 months.
+
+ 
+
+Our
+general and administrative expenses primarily consist of payroll and welfare expenses, depreciation, share of expenses for office rentals
+and back office supports, travel and entertainment expenses, consulting and professional service fees. General and administrative expenses
+increased by approximately $157,000 or 30.34%, from approximately $516,000 for the six months ended March 31, 2024, to approximately
+$673,000 for the six months ended March 31, 2025.
+
+ 
+
+The
+increase in general and administrative expenses was primarily the result of the following:
+
+ 
+
+ 
+ 
+ For the six months ended March 31 
+ Changes 
+
+ 
+ 
+ 2025 
+ 2024 
+ Amount 
+ % 
+
+ 
+ 
+ (Unaudited) 
+ (Unaudited) 
+ 
+ 
+
+ 
+ GENERAL AND ADMINISTRATIVE EXPENSES 
+ 
+ 
+ 
+ 
+
+ 
+ GENERAL AND ADMINISTRATIVE EXPENSES 
+ 
+ 
+ 
+ 
+
+ 
+ Salaries and allowance 
+ $454,709 
+ $316,752 
+ $137,957 
+ 43.55 
+
+ 
+ Legal and professional fee 
+ 41,304 
+ 5,866 
+ 35,438 
+ 604.13 
+
+ 
+ Mandatory provident fund 
+ 19,567 
+ 13,760 
+ 5,807 
+ 42.20 
+
+ 
+ Operating expenses and others 
+ 79,024 
+ 80,173 
+ (1,149) 
+ (1.43)
+
+ 
+ GENERAL AND ADMINISTRATIVE EXPENSES - RELATED PARTY 
+ 78,114 
+ 99,588 
+ (21,474) 
+ (21.56)
+
+ 
+ Total 
+ $672,718 
+ $516,139 
+ $156,579 
+ 30.34 
+
+ 
+
+ 
+
+The
+increase in salary and allowance and mandatory provident fund was primarily due to the increase in headcount. The decrease in the related
+party expenses is the result of the decrease in the lease expenses to Vizz Technology Limited from $61,000 for the six months ended March
+31, 2024 to $39,539 for the six months ended March 31, 2025.
+
+ 
+
+Net
+(Loss) Income
+
+ 
+
+ 
+ 
+ For
+ the six months ended
+ March
+ 31
+ 
+ Changes 
+
+ 
+ 
+ 2025
+ (Unaudited)
+ 
+ 2024 
+ Amount 
+ % 
+
+ 
+ Net (Loss) Income 
+ $(333,781) 
+ $67,542 
+ $(401,323) 
+ (594.18)
+
+ 
+
+ 
+
+As
+a result of the foregoing, we reported a net loss of approximately $334,000 for the six months ended March 31, 2025, as compared with
+a net income of approximately $68,000 for the six months ended March 31, 2024.
+
+ 
+
+Capital
+Structure and Liquidity
+
+ 
+
+ 
+ 
+ As of 
+ Changes 
+
+ 
+ 
+ March
+ 31,
+ 2025
+ 
+ September 30, 2024 
+ Amount 
+ % 
+
+ 
+ 
+ (Unaudited) 
+ 
+ 
+ 
+
+ 
+ Total MediaOn Group Inc. Shareholders Deficit 
+ $(2,266,996) 
+ (1,934,807) 
+ $(332,189) 
+ 17.17 
+
+ 
+ Less: Non-controlling Interest 
+ 579 
+ 579 
+ - 
+ - 
+
+ 
+ Total Shareholders Deficit 
+ $(2,266,417) 
+ $(1,934,228) 
+ $(332,189) 
+ 17.17 
+
+ 
+
+ 
+
+As
+of March 31, 2025, our total shareholders deficit increased by 17.17% to approximately $2,266,000 compared with total
+shareholders deficit approximately $1,934,000 as of September 30, 2024. The increase was primarily due to the net loss during
+the six months ended March 31, 2025.
+
+ 
+
+ 49
+
+ 
+
+ 
+
+ 
+
+The
+MediaOn Group Inc. Shareholders Deficit includes share capital, additional paid-in capital, accumulated deficit and accumulated
+other comprehensive losses. It is computed by deducting a firm s overall liabilities from its total assets without minority interest.
+
+ 
+
+ 
+ 
+ As of 
+ Changes 
+
+ 
+ 
+ March 31, 2025 
+ % 
+ September 30, 2024 
+ % 
+ Amount 
+ % 
+
+ 
+ 
+ (Unaudited) 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Non-current Assets 
+ $1,827,371 
+ 62.12 
+ $1,960,395 
+ 61.97 
+ $(133,024) 
+ (6.79)
+
+ 
+ Current Assets 
+ $1,114,463 
+ 37.88 
+ 1,203,133 
+ 38.03 
+ (88,670) 
+ (7.37)
+
+ 
+ Total Assets 
+ $2,941,834 
+ 100.00 
+ $3,163,528 
+ 100.00 
+ $(221,694) 
+ (7.01)
+
+ 
+
+ 
+
+ 
+ 
+ As of 
+ Changes 
+
+ 
+ 
+ March 31, 2025 
+ % 
+ September 30, 2024 
+ % 
+ Amount 
+ % 
+
+ 
+ 
+ (Unaudited) 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Non-current Liabilities 
+ $1,514,286 
+ 29.07 
+ $1,734,852 
+ 34.03 
+ $(220,566) 
+ (12.71)
+
+ 
+ Current Liabilities 
+ 3,693,965 
+ 70.93 
+ 3,362,904 
+ 65.97 
+ 331,061 
+ 9.84 
+
+ 
+ Total Liabilities 
+ $5,208,251 
+ 100.00 
+ $5,097,756 
+ 100.00 
+ $110,495 
+ 2.17 
+
+ 
+
+ 
+
+Total
+assets amounted to approximately $2,942,000 as of March 31, 2025, compared with approximately $3,164,000 as of September 30, 2024, representing
+a 7.01% decrease. Current assets amounted to approximately $1,114,000 as of March 31, 2025, compared with approximately $1,203,000 as
+of September 30, 2024. Current liabilities were approximately $3,694,000 as of March 31, 2025, compared with approximately $3,363,000
+as of September 30, 2024. The current ratio in for the six months ended March 31, 2025 was 0.30, compared with 0.36 for the year ended
+September 30, 2024. The current ratio represents current assets divided by current liabilities and is a liquidity ratio used to measure
+a company s ability to pay short-term obligations or those liabilities that are due within one year.
+
+ 
+
+ 
+ 
+ As of 
+ Changes 
+
+ 
+ 
+ March 31, 2025 
+ September 30, 2024 
+ Amount 
+ % 
+
+ 
+ 
+ (Unaudited) 
+ 
+ 
+ 
+
+ 
+ Current Assets 
+ $1,114,463 
+ $1,203,133 
+ $(88,670) 
+ (7.37)
+
+ 
+ Current Liabilities 
+ 3,693,965 
+ 3,362,904 
+ 331,061 
+ 9.84 
+
+ 
+ Working Capital (deficit) 
+ $(2,579,502) 
+ $(2,159,771) 
+ $(419,731) 
+ (19.43)
+
+ 
+
+ 
+
+As
+of March 31, 2025, our working capital deficit was approximately $(2,580,000) compared to working capital deficit approximately $2,160,000
+as of September 30, 2024. Our working capital needs are influenced by the size of our operations, the volume, dollar value, and performance
+of our sales contracts, and the timing for collecting accounts receivable and media deposits and repayment of accounts payable.
+
+ 
+
+To
+date, we have financed our operations primarily through cash flow from operations and loans from our shareholders and bank financing
+when necessary. We plan to support our future operations from new funding raised from this offering, cash generated from our operations
+and cash on hand.
+
+ 
+
+We
+believe that our current cash and cash equivalents, together with the borrowing capacity under our revolving credit facilities and the
+term loan facility and anticipated proceeds from this offering will be sufficient to meet our anticipated working capital requirements
+and capital expenditures for the 12 months following this offering. We may, however, need additional capital in the future to fund our
+continued operations. If we determine that our cash requirements exceed our available financial resources, we may seek to issue equity
+or debt securities or obtain credit facilities. The issuance and sale of additional equity would result in further dilution to our shareholders.
+The incurrence of indebtedness would result in increased fixed obligations and could result in operating and financial covenants that
+might restrict our operations. We cannot assure you that financing will be available in amounts or on terms acceptable to us.
+
+ 
+
+ 50
+
+ 
+
+ 
+
+ 
+
+Contractual
+Obligations
+
+ 
+
+As
+of March 31, 2025, our contractual obligation to repay outstanding bank borrowings and loans from related parties totaled approximately
+$1,089,000 and approximately $1,541,000, respectively. As of September 30, 2024, our contractual obligation to repay outstanding bank
+borrowing and loans from related parties totaled approximately $1,228,000 and approximately $1,557,000, respectively.
+
+ 
+
+We
+share offices with our shareholders through a management contract that we do not have any finance leases as defined in ASC Topic 842.
+
+ 
+
+The
+following table summarizes our cash flow data for the periods presented:
+
+ 
+
+ 
+ 
+ For
+ the six months ended
+ March
+ 31,
+ 
+
+ 
+ 
+ 2025 
+ 2024 
+
+ 
+ Net cash (used in) provided by: 
+ (Unaudited) 
+ (Unaudited) 
+
+ 
+ Operating activities 
+ $(100,834) 
+ $(1,089,165)
+
+ 
+ Investing activities 
+ (1,088) 
+ (3,985)
+
+ 
+ Financing activities 
+ 3,902 
+ 575,085 
+
+ 
+ Effect of foreign currency translation 
+ (216) 
+ 688 
+
+ 
+ Net increase in cash and cash equivalents 
+ (98,236) 
+ (517,377)
+
+ 
+ Cash and cash equivalents, beginning of year 
+ 186,684 
+ 649,067 
+
+ 
+ Cash and cash equivalents, end of year 
+ $88,448 
+ $131,690 
+
+ 
+
+ 
+
+Operating
+Activities
+
+ 
+
+Net
+cash used in operating activities consists primarily of net income adjusted for non-cash items, including depreciation, accounts receivable,
+accruals and other payables, and is adjusted for the impact of changes in working capital. Net cash used in operations for the six months
+ended March 31, 2025 was $100,834, representing a decrease in cash outflows of $988,331 compared to net cash used in operating activities
+of $1,089,165 for the six months ended March 31, 2024. The improvement in cash outflows was primarily due to (a) the fall in cash used
+in the amounts due to directors from $1,593,827 to $36,168 for the six months ended March 31, 2025 and 2024; and being offset by (b)
+the decrease in cash provided by the amounts due to related parties from $669,588 to $110,797 for the six months ended March 31, 2025
+and 2024.
+
+ 
+
+We
+do not believe we have a material collection risk under our business model that will have a negative impact on collectability. Our business
+has continued to grow and the demand for our services has been increasing. We believe that the outstanding balance of accounts receivable
+will be collected within the credit terms.
+
+ 
+
+Investing
+Activities
+
+ 
+
+Net
+cash used in investing activities amounted to $1,088 and $3,985 for the six months ended March 31, 2025 and 2024, respectively, representing
+purchase of plant and equipment.
+
+ 
+
+Financing
+Activities
+
+ 
+
+Net
+cash provided by financing activities was $3,902 for the six months ended March 31, 2025, a decrease in financing cash inflows of $571,183,
+as compared to $575,085 net cash provided by financing activities for the six months ended March 31, 2024. The inflow in cash provided
+by financing primarily reflects (a) proceeds from unsecured loan of $257,165, and being offset by (b) a repayment of bank borrowings
+of $132,227; (c) an increase in deferred IPO costs of $116,036.
+
+ 
+
+For the years ended September 30, 2024, and 2023
+
+ 
+
+Revenue
+
+ 
+
+Revenues
+are classified into:
+
+ 
+
+ Marketing
+Campaigns
+
+ 
+
+Services
+consist of social media marketing; AI and interactive; multimedia creation; and event management. Revenue is recognized upon
+completion of different deliverables.
+
+ 
+
+ Media
+Placements
+
+ 
+
+Services include media placements on search engines or social platforms
+via third-party media suppliers. The Company acts as an agent and recognizes revenue as commission (media placement revenue net of media
+costs) when media is placed.
+
+ 
+
+ Media
+Rebates
+
+ 
+
+Revenue
+from media suppliers when media placement volume thresholds are met. Rebates range from 20% to 30% depending on media spendings.
+Revenue is recognized when media is scheduled and non-cancellable.
+
+ 
+
+We
+primarily generate our revenue from (i) marketing campaigns; (ii) media placement; (iii) rebate income. Except for item (ii), we recognize
+all our revenue on a gross basis, comprising:
+
+ 
+
+(i)marketing
+ campaigns for (a) service fees from clients and advertising revenue for social media platforms,
+ which is the budgeted amount for each promotional campaign paying by clients; (b) events
+ base campaigns are paid by clients for a pre-determined sum for the whole event management,
+ but media costs for this category are recognized netted, revenue recognized upon the completion
+ of the event;
+
+(ii)we
+ earn a pre-determined agency fee to place online advertisements for clients;
+
+(iii)media
+ rebates are earned from contract with media platform for a placement sum commitment. The
+ placement sums are from our placements for clients and placements by our co-operation agents.
+
+ 
+
+We primarily generate our revenue from (i) campaign-based
+digital marketing; (ii) search engine optimization (SEO); (iii) media placement; (iv) online to offline (O2O) event; (v) rebate income;
+and (vi) others such as creative and web designs. Except for item (iii), we recognize all our revenue on a gross basis, comprising (i)
+campaign-based digital marketing for service fees from clients and advertising revenue for social media platforms, which is the budgeted
+amount for each promotional campaign paying by clients; and (ii) search engine optimization, which is the budgeted amount paying by client
+to reach a better position for clients link in search engine result; (iii) we earn a pre-determined agency fee to place online
+advertisements for clients; (iv) events are paid by clients for a pre-determined sum for the whole event management, but media costs for
+this category are recognized netted; (v) media rebates are earned from contract with media platform for a placement sum commitment. The
+placement sums are from our placements for clients and placements by our co-operation agents; and (vi) the other categories of revenue
+are recognized by the percentage of completion.
+
+ 
+
+We analyze both revenue and gross profits to evaluate
+our business. As there is few statistics for our industry in Hong Kong is relatively, we evaluate our market share by searching
+information from our peers competitors or clients. We review our net income to measure our performance, identify trends affecting our
+business; establish our budgets, measure the effectiveness of sales and marketing, and determine our operational performance.
+
+ 
+
+ 51
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ For the years ended
+ September 30,
+ 
+ Changes 
+
+ 
+ 
+ 2024 
+ USD 
+ % to Revenue 
+ 2023 
+ USD 
+ % to Revenue 
+ USD 
+ % 
+
+ 
+ Marketing Campaigns 
+ 1,397,391 
+ 49.83 
+ 704,004 
+ 17.75 
+ 693,387 
+ 98.49 
+
+ 
+ Media Placements 
+ 206,411 
+ 7.36 
+ 185,153 
+ 4.67 
+ 21,258 
+ 11.48 
+
+ 
+ Media Rebates 
+ 1,200,573 
+ 42.81 
+ 3,076,958 
+ 77.58 
+ (1,876,385) 
+ (60.98)
+
+ 
+ Total 
+ 2,804,375 
+ 100.00 
+ 3,966,115 
+ 100.00 
+ (1,161,740) 
+ (29.29)
+
+ 
+
+ 
+
+For the fiscal year ended September 30, 2024,
+we recorded revenue of approximately $2,800,000, representing a decrease of 29.29% from revenue of approximately $4,000,000 for the fiscal
+year ended September 30, 2023. The decrease in revenue was mainly attributable to decreased revenue from our media rebates resulted
+from the merger and acquisition of our major media placing platform.
+
+ 
+
+Revenue derived from marketing campaigns was approximately
+$1,400,000 for the fiscal year ended September 30, 2024, compared with approximately $700,000 for the fiscal year ended September 30,
+2023, representing an increase of 98.49%. This was because our clients had spent more to capture the market opportunities
+after the release of gathering prohibition after COVID-19.
+
+ 
+
+Revenue derived from media placement, or agency fees,
+was approximately $206,000 for the fiscal year ended September 30, 2024, compared with approximately $185,000 for the fiscal year ended
+September 30, 2023, representing a slight increase of 11.48%. We believe the cause of the increase is in line with the
+cause of marketing campaigns.
+
+ 
+
+Revenue derived from media rebate was approximately
+$1,200,000 for the fiscal year ended September 30, 2024, compared with approximately $3,000,000 for the fiscal year ended September
+30, 2023, representing a decrease of 60.98%. The decrease was mainly because our co-operation with third-party media
+platforms have outsourced a segment of digital media spendings to be spent under our contract with digital media in 2024. It is also
+a trend that media spending pattern for SMEs have been shifted to more digital social media focus.
+
+ 
+
+Cost of Revenues
+
+ 
+
+ 
+ 
+ For the years ended
+ September 30,
+ 
+ Changes 
+
+ 
+ 
+ 2024
+ USD
+ 
+ % to Revenue 
+ 2023 USD 
+ % to Revenue 
+ USD 
+ % 
+
+ 
+ Marketing Campaigns 
+ 852,354 
+ 72.83 
+ 364,327 
+ 21.93 
+ 488,027 
+ 133.95 
+
+ 
+ Media Placements 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+
+ 
+ Media Rebates 
+ 318,019 
+ 27.17 
+ 1,296,983 
+ 78.07 
+ (978,964) 
+ (75.48)
+
+ 
+ Total 
+ 1,170,373 
+ 100.00 
+ 1,661,310 
+ 100.00 
+ (490,937) 
+ (29.55)
+
+ 
+
+ 
+
+Cost of Revenues for the fiscal year ended September
+30, 2024, decreased to approximately $1,170,000 compared with approximately $1,661,000 for the previous fiscal year. The decrease
+was mainly because of the decrease of our media rebates earned from our own clients and channel agents in 2024.
+
+ 
+
+Cost of Revenues for marketing campaigns was approximately
+$852,000 for the fiscal year ended September 30, 2024, compared with approximately $364,000 for the fiscal year ended September 30, 2023,
+representing an increase of 133.95%. The increase was mainly associated with an increase in outsourced services of our business
+in 2024.
+
+ 
+
+Cost of Revenues for media placement was recognized
+netted that no media buying costs were accounted for.
+
+ 
+
+Cost of Revenues for media rebates was approximately
+$318,000 for the fiscal year ended September 30, 2024, compared with approximately $1,297,000 for the fiscal year ended September 30,
+2023, representing a decrease of 75.48%. The decrease was primarily the result of the decrease of revenue from media rebates. 
+
+ 
+
+ 52
+
+ 
+
+ 
+
+ 
+
+Other Income, net
+
+ 
+
+ 
+ 
+ For the years ended
+ September 30
+ 
+ Changes 
+
+ 
+ 
+ 2024 
+ 2023 
+ Amount 
+ % 
+
+ 
+ Interest income 
+ $1,980 
+ $1,308 
+ $672 
+ 51.38 
+
+ 
+ Government subsidy 
+ - 
+ 16,934 
+ (16,934) 
+ (100.00)
+
+ 
+ Sundry (expenses) incomes 
+ (21,859) 
+ 518 
+ (22,377) 
+ (4,319.88)
+
+ 
+ Interest expenses 
+ (197,353) 
+ (21,652) 
+ (175,701) 
+ 811.48
+
+ 
+ Exchange (loss) gain 
+ (3,713) 
+ 4,773 
+ (8,486) 
+ (177.79)
+
+ 
+ Total 
+ $(220,945) 
+ $1,881 
+ $(222,826) 
+ (11,846.15)
+
+ 
+
+ 
+
+Interest expenses primarily were paid
+on loans we obtained from banks and accrued for promissory notes. Interest expenses increased by approximately $176,000, or approximately
+8 times, from approximately $22,000 for the fiscal year ended September 30, 2023 to approximately $197,000 for the fiscal year ended
+September 30, 2024, which was mainly attributable to an increase of $115,844 in average outstanding borrowings from banks and an increase
+in promissory notes of $700,000.
+
+ 
+
+Operating Expenses
+
+ 
+
+ 
+ 
+ For the years ended
+ September 30
+ 
+ Changes 
+
+ 
+ 
+ 2024 
+ 2023 
+ Amount 
+ % 
+
+ 
+ Operating Expenses 
+ 
+ 
+ 
+ 
+
+ 
+ Marketing Expenses 
+ $213,063 
+ $16,835 
+ $196,228 
+ 1,165.60 
+
+ 
+ General and Administrative Expenses 
+ 1,314,716 
+ 1,205,670 
+ 109,046 
+ 9.04 
+
+ 
+ Total 
+ $1,527,779 
+ $1,222,505 
+ $305,274 
+ 24.97 
+
+ 
+
+ 
+
+Marketing expenses for the fiscal year ended September
+30, 2024 were approximately $213,000 compared with approximately $17,000 in 2023, representing 12 times increase. Such an increase
+was mainly attributable to the increased marketing spendings during the year.
+
+ 
+
+Our general and administrative expenses primarily
+consist of payroll and welfare expenses, depreciation, share of expenses for office rentals and back office supports, travel and entertainment
+expenses, consulting and professional service fees. General and administrative expenses increased by approximately $109,000 or 9.04%,
+from approximately $1,206,000 for the fiscal year ended September 30, 2023, to approximately $1,315,000 for the fiscal year ended
+September 30, 2024.
+
+ 
+
+The increase in general and administrative expenses
+was primarily the result of the following:
+
+ 
+
+ 
+ 
+ 2024 
+ 2023 
+ Changes
+
+ 
+ 
+ (USD) 
+ (USD) 
+ Amount 
+ %
+
+ 
+ GENERAL AND ADMINISTRATIVE EXPENSES 
+ 
+ 
+ 
+ 
+
+ 
+ GENERAL AND ADMINISTRATIVE EXPENSES 
+ 
+ 
+ 
+ 
+
+ 
+ Salaries and allowance 
+ $789,610 
+ $560,575 
+ $229,035 
+ 40.86 
+
+ 
+ Legal and professional fee 
+ 135,793 
+ 125,445 
+ 10,348 
+ 8.25 
+
+ 
+ Mandatory provident fund 
+ 33,718 
+ 23,105 
+ 10,613 
+ 45.93 
+
+ 
+ Operating expenses and others 
+ 178,192 
+ 249,418 
+ (71,226) 
+ (28.56)
+
+ 
+ GENERAL AND ADMINISTRATIVE EXPENSES - RELATED PARTY 
+ 177,403 
+ 247,127 
+ (69,724) 
+ (28.21)
+
+ 
+ Total 
+ $1,314,716 
+ $1,205,670 
+ $109,046 
+ $9.04 
+
+ 
+
+ 
+
+The increase in salary
+and allowance and mandatory provident fund was primarily due to the increase in headcount. The decrease in the related party
+expenses is the result of the decrease in the management fee paid to Vizz Technology Limited from $153,237 for the fiscal year
+ended September 30, 2023 to $76,798 for the fiscal year ended September 30, 2024.
+
+ 
+
+Net (Loss) Income
+
+ 
+
+ 
+ 
+ For the years ended
+ September 30
+ 
+ Changes 
+
+ 
+ 
+ 2024 
+ 2023 
+ Amount 
+ % 
+
+ 
+ Net (Loss) Income 
+ $(165,103) 
+ $1,060,906 
+ $(1,226,009) 
+ (115.56)
+
+ 
+
+ 
+
+As a result of the foregoing, we reported a net loss
+of approximately $165,000 for the fiscal year ended September 30, 2024, as compared with a net income of approximately $1,061,000 for
+the fiscal year ended September 30, 2023.
+
+ 
+
+Capital Structure and Liquidity
+
+ 
+
+ 
+ 
+ As of
+ September 30
+ 
+ Changes 
+
+ 
+ 
+ 2024 
+ 2023 
+ Amount 
+ % 
+
+ 
+ Total MediaOn Group Inc. Shareholders Deficit 
+ $1,934,807 
+ 1,759,551 
+ $175,256 
+ 9.96 
+
+ 
+ Less: Non-controlling Interest 
+ 579 
+ - 
+ 579 
+ 100.00 
+
+ 
+ Total Shareholders Deficit 
+ $1,934,228 
+ $1,759,551 
+ $174,677 
+ 9.93 
+
+ 
+
+ 
+
+As of September 30, 2024, our total shareholders 
+deficit increased by 9.93% to approximately $1,934,000 compared with total shareholders deficit approximately $1,760,000
+as of September 30, 2023. The increase was primarily due to the net loss during the year ended September 30, 2024.
+
+ 
+
+ 53
+
+ 
+
+ 
+
+ 
+
+The MediaOn Group Inc. Shareholders Deficit
+includes share capital, additional paid-in capital, accumulated deficit and accumulated other comprehensive losses. It is computed
+by deducting a firm s overall liabilities from its total assets without minority interest.
+
+ 
+
+ 
+ 
+ As of
+ September 30
+ 
+ Changes 
+
+ 
+ 
+ 2024 
+ % 
+ 2023 
+ % 
+ Amount 
+ % 
+
+ 
+ Non-current Assets 
+ $1,960,395 
+ 61.97 
+ $3,016,304 
+ 60.12 
+ $(1,055,909) 
+ (35.01)
+
+ 
+ Current Assets 
+ $1,203,133 
+ 38.03 
+ 2,000,850 
+ 39.88 
+ (797,717) 
+ (39.87)
+
+ 
+ Total Assets 
+ $3,163,528 
+ 100.00 
+ $5,017,154 
+ 100.00 
+ $(1,853,626) 
+ (36.95)
+
+ 
+
+ 
+
+ 
+ 
+ As of
+ September 30
+ 
+ Changes 
+
+ 
+ 
+ 2024 
+ % 
+ 2023 
+ % 
+ Amount 
+ % 
+
+ 
+ Non-current Liabilities 
+ $
+1,734,852 
+ 34.03 
+ $3,480,729 
+ 51.36 
+ $(1,745,877) 
+ (50.16)
+
+ 
+ Current Liabilities 
+ 3,362,904 
+ 65.97 
+ 3,295,976 
+ 48.64 
+ 66,928 
+ 2.03 
+
+ 
+ Total Liabilities 
+ $
+5,097,756 
+ 100.00 
+ $6,776,705 
+ 100.00 
+ $(1,678,949) 
+ (24.78)
+
+ 
+
+ 
+
+Total assets amounted to approximately $3,164,000
+as of September 30, 2024, compared with approximately $5,017,000 as of September 30, 2023, representing a 36.95% decrease. Current assets
+amounted to approximately $1,203,000 as of September 30, 2024, compared with approximately $2,001,000 as of September 30, 2023. Current
+liabilities were approximately $3,363,000 in the year ended September 30, 2024, compared with approximately $3,296,000 in the year ended
+September 30, 2023. The current ratio in 2024 was 0.36, compared with 0.61 in 2023. The current ratio represents current assets divided
+by current liabilities and is a liquidity ratio used to measure a company s ability to pay short-term obligations or those liabilities
+that are due within one year.
+
+ 
+
+ 
+ 
+ As of
+ September 30,
+ 
+ Changes 
+
+ 
+ 
+ 2024 
+ 2023 
+ Amount 
+ % 
+
+ 
+ Current Assets 
+ $1,203,133 
+ $2,000,850 
+ $(797,717) 
+ (39.87)
+
+ 
+ Current Liabilities 
+ 3,362,904 
+ 3,295,976 
+ 66,928 
+ 2.03 
+
+ 
+ Working Capital (deficit) 
+ $(2,159,771) 
+ $(1,295,126) 
+ $(864,645) 
+ (66.76)
+
+ 
+
+ 
+
+As of September 30, 2024, our working capital deficit
+was approximately $2,160,000 compared to working capital approximately $1,295,000 as of September 30, 2023. Our working capital needs
+are influenced by the size of our operations, the volume, dollar value, and performance of our sales contracts, and the timing for collecting
+accounts receivable and media deposits and repayment of accounts payable.
+
+ 
+
+As of to date, we have financed our operations primarily
+through cash flow from operations and loans from our shareholders and bank financing when necessary. We plan to support our future operations
+from new funding raised from this offering, cash generated from our operations and cash on hand.
+
+ 
+
+We believe that our current cash and cash equivalents,
+together with the borrowing capacity under our revolving credit facilities and the term loan facility and anticipated proceeds from this
+offering will be sufficient to meet our anticipated working capital requirements and capital expenditures for the 12 months following
+this offering. We may, however, need additional capital in the future to fund our continued operations. If we determine that our cash
+requirements exceed our available financial resources, we may seek to issue equity or debt securities or obtain credit facilities. The
+issuance and sale of additional equity would result in further dilution to our shareholders. The incurrence of indebtedness would result
+in increased fixed obligations and could result in operating and financial covenants that might restrict our operations. We cannot assure
+you that financing will be available in amounts or on terms acceptable to us.
+
+ 
+
+ 54
+
+ 
+
+ 
+
+ 
+
+Contractual Obligations
+
+ 
+
+As of September 30, 2024, our contractual obligation
+to repay outstanding bank borrowings and loans from related parties totaled approximately $1,228,000 and approximately $1,557,000, respectively.
+As of September 30, 2023, our contractual obligation to repay outstanding bank borrowing and loans from related parties totaled approximately
+$1,103,000 and approximately $2,952,000, respectively.
+
+ 
+
+We share offices with our shareholder through a management
+contract that we do not have any finance leases as defined in ASC Topic 842.
+
+ 
+
+The following table summarizes our cash flow data
+for the periods presented:
+
+ 
+
+ 
+ 
+ For the years ended
+ September 30,
+ 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ Net cash (used in) provided by: 
+ 
+ 
+
+ 
+ Operating activities 
+ $(960,540) 
+ $(118,582)
+
+ 
+ Investing activities 
+ (6,194) 
+ (5,419)
+
+ 
+ Financing activities 
+ 479,422 
+ 409,669 
+
+ 
+ Effect of foreign currency translation 
+ 24,929 
+ 891 
+
+ Net increase in cash and cash equivalents 
+ (462,383) 
+ 286,559 
+
+ 
+ Cash and cash equivalents, beginning of year 
+ 649,067 
+ 362,508 
+
+ 
+ Cash and cash equivalents, end of year 
+ $186,684 
+ $649,067 
+
+ 
+
+ 
+
+Operating Activities
+
+ 
+
+Net cash used in operating activities consists
+primarily of net income adjusted for non-cash items, including depreciation, accounts receivable, accruals and other payables, and
+is adjusted for the impact of changes in working capital. Net cash used in operations for September 30, 2024 was $960,540,
+representing an increase in cash outflows of $841,958 compared to net cash used in operating activities of $118,582 for the year
+ended September 30, 2023. The increase in such cash outflows is mainly attributable to (a) a decrease in amount due to
+directors of $1,755,353; (b) a decrease in accounts payable of $987,301; (c) an increase in amount due to related parties of
+$345,272; (d) a decrease in lease liabilities of $227,214; (e) an increase in interest payable to promissory notes of $131,260; (f)
+a decrease in deferred revenue of $52,105; and (g) a decrease in accruals and other payable $22,016.
+
+ 
+
+We do not believe we have a material collection risk
+under our business model that will have a negative impact on collectability. Our business has continued to grow and the demand for our
+services has been increasing. We believe that the outstanding balance of accounts receivable will be collected within the credit terms.
+
+ 
+
+Investing Activities
+
+ 
+
+Net cash used in investing activities amounted to
+$6,194 and $5,419 for the years ended September 30, 2024 and 2023, respectively, representing purchase of plant and equipment.
+
+ 
+
+Financing Activities
+
+ 
+
+Net cash provided by financing activities was $479,422
+for the year ended September 30, 2024, an increase in financing cash inflows of $69,753, as compared to $409,669 net cash provided by
+financing activities for the year ended September 30, 2023. The inflow in cash provided by financing primarily reflects (a) proceeds
+from new bank borrowings of $371,190 and (b) proceeds from promissory notes of $700,000; being offset by (a) a repayment of bank borrowings
+of $255,346 and (b) an increase in deferred IPO costs of $336,422.
+
+ 
+
+ 55
+
+ 
+
+ 
+
+ 
+
+OFF-BALANCE-SHEET ARRANGEMENTS
+
+ 
+
+We have not entered into any derivative contracts
+that are indexed to our shares and classified as shareholders equity or that are not reflected in our consolidated financial statements.
+Furthermore, we do not have any retained or contingent interest in assets transferred to an unconsolidated entity that serves as credit,
+liquidity, or market risk support to such entity. We do not have any variable interest in any unconsolidated entity that provides financing,
+liquidity, market risk or credit support or that engages in leasing, hedging, or research and development services with us.
+
+ 
+
+INFLATION
+
+ 
+
+Inflation does not materially affect our business
+or the results of our operations.
+
+ 
+
+CRITICAL ACCOUNTING POLICIES AND ESTIMATES
+
+ 
+
+Our discussion and analysis of our financial condition
+and results of operations are based upon our consolidated financial statements. These financial statements are prepared in accordance
+with U.S. GAAP, which requires the Company to make estimates and assumptions that affect the reported amounts of our assets and liabilities
+and revenues and expenses, to disclose contingent assets and liabilities on the dates of the consolidated financial statements, and to
+disclose the reported amounts of revenues and expenses incurred during the financial reporting periods. The most significant estimates
+and assumptions include the valuation of accounts receivable, useful lives of property and equipment and intangible assets, recoverability
+of long-lived assets, provisions necessary for contingent liabilities, and revenue recognition. We continue to evaluate these estimates
+and to make assumptions that we believe are reasonable under the circumstances. We rely on these evaluations as the basis for making judgments
+about the carrying values of assets and liabilities that are not readily apparent from other sources. Since the use of estimates is an
+integral component of the financial reporting process, actual results could differ from those estimates as a result of changes in our
+estimates. Some of our accounting policies require higher degrees of judgment than others in their application. We believe critical accounting
+policies as disclosed in this prospectus reflect the more significant judgments and estimates used in preparing our consolidated financial
+statements.
+
+ 
+
+The following critical accounting policies were used
+in preparing our consolidated financial statements:
+
+ 
+
+Basis of presentation and principle of consolidation
+
+ 
+
+The accompanying consolidated financial statements have been prepared in
+accordance with accounting principles generally accepted in the United States ("U.S. GAAP") and pursuant to the rules and
+regulations of the Securities Exchange Commission ("SEC").
+
+ 
+
+These consolidated financial statements include the financial statements
+of the Company and its subsidiaries. All intercompany transactions and balances among the Company and its subsidiaries have been eliminated
+upon consolidation.
+
+ 
+
+Foreign currency translation
+
+ 
+
+The accompanying audited consolidated financial statements
+are presented in United States dollar ("$"). The functional currency of the Company is Hong Kong dollar ("HK$").
+MOHK s statement of operation and balance sheet are translated into $ from HK$ at HK$7.8127=$1.0 for statement of operation and
+at HK$7.7693=$1.0 for balance sheet for the fiscal year 2024 and at HK$7.831=$1.0 for statement of operation and at HK$7.8308=$1.0 for
+balance sheet for the fiscal year 2023.
+
+ 
+
+Our reporting currency is U.S. Dollars ("US$").
+We determine the functional currency of each of our international subsidiaries and their operating divisions based on the primary currency
+in which they operate. In cases where the functional currency is not US$, we recognize a cumulative translation adjustment created by
+the different rates we apply to current period income or loss and the balance sheet. For each subsidiary, we apply the average functional
+exchange rate to its income or loss and the year-end functional exchange rate to translate the balance sheet.
+
+ 
+
+ 56
+
+ 
+
+ 
+
+ 
+
+Use of estimates
+
+ 
+
+The preparation of the audited consolidated financial
+statements in conformity with accounting principles generally accepted in the United States of America ("US GAAP"), requires
+management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets
+and liabilities at the date of the audited consolidated financial statements and the reported amounts of revenues and expenses during
+the reporting periods.
+
+ 
+
+Significant accounting estimates required to be made
+by management which reflected in the Company s consolidated financial statements include the useful lives of property and equipment,
+the collectability of accounts, and fair value of long-lived assets, the discount rate of leases, and uncertain tax position.
+
+ 
+
+The Company evaluates its estimates and assumptions
+on an ongoing basis and its estimates on historical experience, current and expected future conditions and various other assumptions that
+management believes are reasonable under the circumstances based on the best information available to management at the time these estimates
+and assumptions are made. However, actual results could differ from these estimates.
+
+ 
+
+Cash
+
+ 
+
+The Company considers cash and bank deposits
+primarily of cash in accounts held at a financial institution.
+
+ 
+
+Leases
+
+ 
+
+The Company adopted ASU No. 2016-02 — Leases
+(Topic 842) since September 30, 2021, using a modified retrospective transition method permitted under ASU No. 2018-11. This transition
+approach provides a method for recording existing leases only at the date of adoption and does not require previously reported balances
+to be adjusted. The Company evaluates the contracts it enters into to determine whether such contracts contain leases at inception. A
+contract contains a lease if the contract conveys the right to control the use of identified property, plant or equipment for a period
+of time in exchange for consideration. At commencement, contracts containing a lease are further evaluated for classification as an operating
+or finance lease where the Company is a lessee.
+
+ 
+
+Operating Leases
+
+ 
+
+A lease for which substantially all the
+benefits and risks incidental to ownership remain with the lessor is classified by the lease as an operation lease. Operating leases are
+included in the line items right-of-use ("ROU") asset, lease liabilities in current and non-current in the consolidated balance
+sheet.
+
+ 
+
+ROU assets represent the Company s
+right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from
+the lease. For operating leases, the Company measures its lease liabilities based on the present value of the total lease payments not
+yet paid discounted based on the more readily determinable of the rate implicit in the lease or its incremental borrowing rate, which
+is the estimated rate the Company would be required to pay for a collateralized borrowing equal to the total lease payments over the term
+of the lease. The Company uses its incremental borrowing rate based on the information available at lease commencement date in determining
+the present value of lease payments. The Company measures ROU assets based on the corresponding lease liability adjusted for payments
+made to the lessor at or before the commencement date, and initial direct costs it incurs under the lease. The Company begins recognizing
+lease expense when the lessor makes the underlying asset available to the Company. Lease expenses for lease payments are recognized on
+a straight-line basis over the lease term.
+
+ 
+
+For leases with lease term less than one
+year (short-term leases), the Company has elected not to recognize a lease liability or ROU asset on its consolidated balance sheet. Instead,
+it recognizes the lease payments as expenses on a straight-line basis over the lease term. Short-term lease costs are immaterial to its
+consolidated statements of operations and cash flows.
+
+ 
+
+In considering the accounting implications
+of a facility the Company subleased a property to an independent third party with verbal agreement with landlord, the Company
+determined that it would be inappropriate to de-recognize the sublease based on the guidance in ASC 842-20-40-3, since the Company was
+not relieved of the Company s primary obligation under the original lease when we assigned it to the independent third party. As
+such, the Company did not consider this to be a termination of the lease, and instead, the Company separately accounts for the original
+lease and sublease. As a result, and after assessing the recoverability of the related ROU asset, there was no change to our Operating
+lease assets or liabilities as a result of the assignment of this lease, and the Company continued to account for the lease as an operating
+lease in accordance with ASC 842-20-35-14.
+
+ 
+
+ 57
+
+ 
+
+ 
+
+ 
+
+Deposits and prepayments
+
+ 
+
+The Company makes a deposit payment to suppliers for
+the procurement of products and services. Upon physical receipt and inspection of products or provision of services from suppliers, the
+applicable amount is recognized from deposits and prepayments to cost of revenues.
+
+ 
+
+Deferred IPO costs
+
+ 
+
+Deferred IPO costs consist of underwriting, legal,
+accounting and other expenses incurred through the balance sheet date that are directly related to the Initial Public Offering and that
+were charged to shareholders equity upon the completion of the Initial Public Offering. As of September 30, 2024 and September
+30, 2023, the Company had deferred IPO costs of $338,301 and $nil, respectively.
+
+ 
+
+Plant and equipment, net
+
+ 
+
+Plant and equipment are carried at cost less accumulated
+depreciation. Depreciation is provided over their estimated useful lives, using the straight-line method. The Company typically applies
+a salvage value of 0%. The salvage value, the useful life of assets, and methods of depreciation are reviewed at the end of each fiscal
+year, and adjusted prospectively, where applicable. The Company reviewed the useful life of property, plant and equipment in 2024 and
+no significant changes were deemed necessary. The estimated useful lives of the plan and equipment are as follows:
+
+ 
+
+ 
+ Furniture
+ and fixtures
+ 
+ 3-5
+ years
+
+ 
+ Office
+ equipment
+ 
+ 3-5
+ years
+
+ 
+ Computer
+ equipment
+ 
+ 3-5
+ years
+
+ 
+
+ 
+
+The cost and related accumulated depreciation of assets
+sold or otherwise retired are eliminated from the accounts, and any gain or loss are included in the Company s results of operations.
+The costs of maintenance and repairs are recognized as incurred; significant renewals and betterments are capitalized.
+
+ 
+
+Accounting for the impairment of long-lived assets
+
+ 
+
+The Company annually reviews its long-lived assets
+for impairment or whenever events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. Impairment
+may become obsolete from a difference in the industry, introduction of new technologies, or if the Company has inadequate working capital
+to utilize the long-lived assets to generate adequate profits. Impairment is present if the carrying amount of an asset is less than its
+expected future undiscounted cash flows.
+
+ 
+
+If an asset is considered impaired, a loss is recognized
+based on the amount by which the carrying amount exceeds the fair market value of the asset. Assets to be disposed of are reported lower
+the carrying amount or fair value fewer costs to selling.
+
+ 
+
+The Company did not account for impairment of long-lived
+assets for the years ended September 30, 2024 and 2023.
+
+ 
+
+Commitments and contingencies
+
+ 
+
+From time to time, the Company is a party to various
+legal actions arising in the ordinary course of business. The majority of these claims and proceedings related to or arise from commercial
+disputes. The Company first determine whether a loss from a claim is probable, and if it is reasonable to estimate the potential loss.
+The Company accrues costs associated with these matters when they become probable, and the amount can be reasonably estimated. Legal costs
+incurred in connection with loss contingencies are expensed as incurred. Also, the Company disclose a range of possible losses, if a loss
+from a claim is probable but the amount of loss cannot be reasonably estimated, which is in line with the applicable requirements of Accounting
+Standard Codification 450. The Company s management does not expect any liability from the disposition of such claims and litigation
+individually or in the aggregate would have a material adverse impact on the Company s consolidated financial position, results
+of operations and cash flows.
+
+ 
+
+ 58
+
+ 
+
+ 
+
+ 
+
+Related
+parties
+
+ 
+
+The
+Company adopted ASC 850, Related Party Disclosures, for the identification of related parties and disclosure of related party transactions.
+
+ 
+
+Revenue
+recognition
+
+ 
+
+The
+Company follows the rules and guidance set out under ASC 606, Revenue from Contracts with Customers ("ASC 606"), when recognizing
+revenue from contracts with customers. The core principle of ASC 606 requires an entity to recognize revenues to depict the transfer
+of goods to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods
+recognized as performance obligations are satisfied. In accordance with ASC 606, revenues are recognized when the Company satisfies the
+performance obligations by delivering the promised goods to the customers, in an amount that reflects the consideration the Group expects
+to be entitled to in exchange for those goods. The following five steps are applied to achieve that core principle:
+
+ 
+
+ 
+ 
+ Step
+ 1:
+ Identify
+ the contract with the customer
+
+ 
+ 
+ Step
+ 2: 
+ Identify
+ the performance obligations in the contract
+
+ 
+ 
+ Step
+ 3: 
+ Determine
+ the transaction price
+
+ 
+ 
+ Step
+ 4: 
+ Allocate
+ the transaction price to the performance obligations in the contract
+
+ 
+ 
+ Step
+ 5: 
+ Recognize
+ revenue when the company satisfies a performance obligation.
+
+ 
+
+ 
+
+Revenue
+is primarily derived from: 1) media placements – for search engines and social media; 2) media rebates; and 3) marketing campaigns,
+which includes, but not limited to, i) online and offline marketing events; ii) search engine optimizations (SEO); iii) contents creative
+design and production; iv) web-site designs and maintenances; v) social media listening tools; vi) media placement execution supports;
+and vii) traditional TV commercials and outdoor billboards.
+
+ 
+
+For
+revenue arrangements with multiple distinct performance obligations, services promised in the contract are highly interrelated with
+each other and it s not separately identifiable from other promises in the contract. Therefore, all goods and services in the contract
+are exclusively accounted for as a single performance obligation.
+
+ 
+
+The
+Company evaluates if it is a principal or an agent in a transaction to determine whether revenue should be recorded on a gross or net
+basis. The Company acts as the principal if it obtains control over the goods and services before they are transferred to customers.
+Generally, when the Company is primarily obligated in a transaction, is subject to inventory risk, has latitude in establishing prices,
+or has several but not all of these indicators, the Company acts as the principal and revenue is recorded on a gross basis. Generally,
+when the Company is not primarily obligated in a transaction, does not bear the inventory risk and does not have the ability to establish
+the price, the Company acts as the agent and revenue is recorded on a net basis.
+
+ 
+
+ 59
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 1.
+ Media
+ Placement
+
+ 
+
+ We
+ offer media planning, potential media spendings and performance services to our customers. The media placements are operated by our
+ suppliers, and we act as an agent in these transactions. The commissions and any related fulfilment fees we earn from these arrangements
+ are recognized when the services are rendered, which generally occurs upon the media placement occurred to the customers.
+
+ 
+ 
+
+ 
+ 
+ 2.
+ Media
+ Rebates
+
+ 
+
+ We
+ earn the revenue from the suppliers when the total amount generated from media placements achieves the certain amount agreed by the
+ suppliers and us. Our progressive media rebates on the basis of media spendings starting from 20% and up to 30%. Variable consideration
+ for our media businesses includes rebate revenue and is recognized when it is probable that the media will be run, including when
+ it is not subject to cancellation by the client. Performance incentives are typically recognized in revenue over time.
+
+ 
+ 
+
+ 
+ 
+ 3.
+ Marketing
+ Campaigns
+
+ 
+
+ Marketing
+ Campaigns include, but not limited to, i) online and offline marketing events; ii) search engine optimizations (SEO); iii) contents
+ creative design and production; iv) web-site designs and maintenances; v) social media listening tools; vi) media placement execution
+ supports; and vii) traditional TV commercials and outdoor billboards.
+
+ 
+
+ Revenue,
+ related to ongoing services for marketing such as search engine optimizations (SEO), web-site designs and maintenances, social media
+ listening tools, is recognized over time as services are provided.
+
+ 
+
+ Revenue,
+ related to online and offline marketing events, media placement execution supports, traditional TV commercials and outdoor billboards,
+ and contents creative design and production, is recognized upon completion of services.
+
+ 
+ 
+
+Cost
+of revenues
+
+ 
+
+Cost
+of revenues consist primarily of costs associated with the arrangements with media platforms. These mainly include costs related to inhouse
+creative and production of contents, channel agents share of rebate, etc. Cost of revenues also include actual product costs paid
+to suppliers and the cost of transportation to the Company s customers.
+
+ 
+
+ 60
+
+ 
+
+ 
+
+ 
+
+Accounts receivable, net
+
+ 
+
+Accounts receivable, net includes amounts billed
+under the contract terms, normally 30 days. The amounts are stated at their net realizable value. The Company considers several
+factors in its estimate of the allowance, including knowledge of a client s financial condition, its historical collection experience,
+and other factors relevant to assessing the collectability of such receivables. Bad debts are written off against allowances. The Company
+maintains an allowance for expected credit loss to provide for the estimated number of receivables that will not be collected.
+
+ 
+
+Deferred revenue
+
+ 
+
+Deferred revenue includes amount billed to customer
+with receipts for which the aforementioned revenue recognition criteria have not yet been met.
+
+ 
+
+Deferred revenue is mainly unearned revenue related
+to direct media services, support services and events. Normal expected delivery period for our obligations is about 3 months.
+During the years ended September 30, 2024 and 2023, we recognized $149,555 and $200,365 of unearned revenue, respectively.
+
+ 
+
+Expected credit loss
+
+ 
+
+ASU No. 2016-13, Financial Instruments – Credit
+Losses (Topic 326): Measurement of Credit Losses on Financial Instruments requires entities to use a current lifetime expected credit
+loss methodology to measure impairments of certain financial assets. Using this methodology will result in earlier recognition of losses
+than under the current incurred loss approach, which requires waiting to recognize a loss until it is probable of having been incurred.
+There are other provisions within the standard that affect how impairments of other financial assets may be recorded and presented, and
+that expand disclosures. The Company adopted the new standard effective October 1, 2021, the first day of the Company s fiscal year
+and applied to accounts receivable and other financial instruments. The adoption of this guidance did not materially impact the net earning
+and financial position and has no impact on the cash flows.
+
+ 
+
+Advertising
+
+ 
+
+All advertising costs are expensed as incurred.
+
+ 
+
+ 61
+
+ 
+
+ 
+
+ 
+
+Retirement benefits
+
+ 
+
+Retirement benefits in the form of mandatory government-sponsored
+defined contribution plans (Mandatory Provident Fund) are charged to either expense as incurred or allocated to wages as part of cost
+of revenues.
+
+ 
+
+Government subsidy
+
+ 
+
+Government subsidy for the purpose of giving
+immediate financial support to the Company with no future related costs or obligation is recognized upon receipt in the Company s
+consolidated statements of income (loss) and comprehensive income (loss).
+
+ 
+
+For the years ended September 30, 2024 and 2023,
+the Company received government subsidies income amounted to $nil and $16,934, respectively from the Hong Kong Government, and
+was included in other income of the consolidated statements of income and comprehensive income.
+
+ 
+
+Income taxes
+
+ 
+
+The Company recognizes deferred income tax assets
+or liabilities for expected future tax consequences of events recognized in the audited consolidated financial statements or tax returns.
+Under this method, deferred income tax assets or liabilities are determined based upon the difference between the audited consolidated
+financial statement and income tax bases of assets and liabilities using enacted tax rates expected to apply when the differences settle
+or become realized. Valuation allowances are provided when it is more likely than not that a deferred tax asset is not realizable or recoverable
+in the future.
+
+ 
+
+The Company determines that the tax position is more
+likely than not to be sustained and records the largest amount of benefit that is more likely than not to be realized when the tax position
+is settled. the Company recognizes interest and penalties, if any, related to uncertain tax positions in income tax expense.
+
+ 
+
+Comprehensive income (loss)
+
+ 
+
+The Company presents comprehensive income (loss) in
+accordance with ASC Topic 220, Comprehensive Income. ASC Topic 220 states that all items that are required to be recognized under
+accounting standards as components of comprehensive income (loss) be reported in the consolidated financial statements. The components
+of comprehensive income (loss) were the net income for the years and the foreign currency translation adjustments.
+
+ 
+
+Income/(Loss) per share
+
+ 
+
+The Company computes income/(loss) per share following
+ASC Topic 260, "Earnings per share." Basic income/(loss) per share is measured as the income/(loss) available to common shareholders
+divided by the weighted average common shares outstanding for the period. Diluted loss per share presents the dilutive effect on a per-share
+basis from the potential conversion of convertible securities or the exercise of options and or warrants; the dilutive impacts of potentially
+convertible securities are calculated using the as-if method; the potentially dilutive effect of options or warranties are computed using
+the treasury stock method. Potentially anti-dilutive securities (i.e., those that increase income per share or decrease loss per share)
+are excluded from diluted income/(loss) per share calculation. There were no potentially dilutive securities that were in-the-money that
+were outstanding during the years ended September 30, 2024 and 2023.
+
+ 
+
+Segment reporting
+
+ 
+
+ASC 280, "Segment Reporting", establishes
+standards for reporting information about operating segments on a basis consistent with the Company s internal organizational structure
+as well as information about geographical areas, business segments and major customers in financial statements for detailing the Company s
+business segments. The Company uses the "management approach" in determining reportable operating segments. The management
+approach considers the internal organization and reporting used by the Company s chief operating decision maker for making operating
+decisions and assessing performance as the source for determining the Company s reportable segments. Management, including the
+chief operating decision maker, reviews operation results by the revenue of different products or services. Based on management s
+assessment, the Company had three operating and reportable segments during the years presented as set out in Note 14.
+
+ 
+
+ 62
+
+ 
+
+ 
+
+ 
+
+Financial instruments
+
+ 
+
+The Company s financial instruments, including
+cash and cash equivalents, accounts and other receivables, accounts and other payables, accrued liabilities, amounts due from (to) related
+parties, promissory notes payable and bank and other loans, have carrying amounts that approximate their fair values due to their short
+maturities. ASC Topic 820, "Fair Value Measurements and Disclosures" requires disclosing the fair value of financial instruments
+held by the Company. ASC Topic 825, "Financial Instruments" defines fair value and establishes a three-level valuation hierarchy
+for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The carrying amounts reported
+in the audited consolidated balance sheets for cash and cash equivalents, accounts and other receivables, accounts and other payables,
+accrued liabilities, amounts due from (to) related parties, promissory notes payable and bank and other loans each qualify as financial
+instruments and are a reasonable estimate of their fair values because of the short period between the origination of such instruments
+and their expected realization and their current market rate of interest. The three levels of valuation hierarchy are defined as follows:
+
+ 
+
+ 
+ 
+ 
+ Level 1 – inputs to the valuation methodology used quoted prices for identical assets or liabilities in active markets. 
+
+ 
+ 
+
+ 
+ 
+ 
+ Level 2 – inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and information that are observable for the asset or liability, either directly or indirectly, for substantially the financial instrument s full term. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Level 3 – inputs to the valuation methodology are unobservable and significant to the fair value measurement. 
+
+ 
+
+ 
+
+Recent accounting pronouncements
+
+ 
+
+Effective October 1, 2021, the Company adopted ASU
+2021-10, Government Assistance (Topic 832), Disclosures by Business Entities About Government Assistance, which requires entities
+to provide disclosures on material government assistance transactions for annual reporting periods. The disclosures include information
+around the nature of the assistance, the related accounting policies used to account for government assistance, the effect of government
+assistance on the entity s financial statements and any significant terms and conditions of the agreements, including commitments
+and contingencies. The adoption of this standard did not have an impact on the consolidated financial statements.
+
+ 
+
+In June 2022, the FASB issued ASU No. 2022-03, "Fair
+Value Measurements (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions," which
+clarifies and amends the guidance of measuring the fair value of equity securities subject to contractual restrictions that prohibit the
+sale of the equity securities. The guidance will be effective for fiscal years beginning after December 15, 2023 and interim periods
+within those fiscal years. The Company does not expect the adoption to have a material impact on the consolidated financial statements.
+
+ 
+
+In November 2023, the Financial Accounting Standards
+Board (FASB) issued Accounting Standards Update (ASU) No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment
+Disclosures (ASU 2023-07), which requires that an entity disclose significant segment expenses impacting profit and loss that are
+regularly provided to the chief operating decision maker. The update is required to be applied retrospectively to prior periods presented,
+based on the significant segment expense categories identified and disclosed in the period of adoption. This ASU guidance is effective
+for our financial reports on this prospectus for the year ended September 30, 2024, and subsequent interim periods, with early adoption
+permitted.
+
+ 
+
+In December 2023, the FASB issued ASU No. 2023-09,
+Improvements to Income Tax Disclosures (ASU 2023-09), which requires that an entity disclose specific categories in the effective
+tax rate reconciliation as well as provide additional information for reconciling items that meet a quantitative threshold. Further,
+this ASU requires certain disclosures of state versus federal income tax expense and taxes paid. This ASU is effective for our Annual
+Report on Form 20-F for the year ended September 30, 2025, with early adoption permitted. The Company does not expect the adoption of
+ASU 2023-09 to have a material impact on its financial statements. 
+
+ 
+
+In November 2024, the FASB issued ASU 2024-03, "Income
+Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures". The ASU requires disclosure,
+in the notes to financial statements, of specified information about certain costs and expenses. The amendments require that at each
+interim and annual reporting period an entity: (1) disclose the amounts of (a) purchases of inventory, (b) employee compensation, (c)
+depreciation, (d) intangible asset amortization, and (e) depreciation, depletion, and amortization recognized as part of oil and
+gas-producing activities ("D&A") (or other amounts of depletion expense) included in each relevant expense caption.
+A relevant expense caption is an expense caption presented on the face of the income statement within continuing operations that contains
+any of the expense categories listed in 1 (e), (2) include certain amounts that are already required to be disclosed under
+current GAAP in the same disclosure as the other disaggregation requirements, (3) disclose a qualitative description of the amounts remaining
+in relevant expense captions that are not separately disaggregated quantitatively, and (4) disclose the total amount of selling expenses
+and, in annual reporting periods, an entity s definition of selling expenses. An entity is not precluded from providing additional
+voluntary disclosures that may provide investors with additional decision-useful information. The ASU is effective for annual periods
+beginning after December 15, 2026, and interim report periods beginning after December 15, 2027. Early application of the amendment is
+permitted. The ASU should be applied either (1) prospectively to financial statements issued for reporting periods after the effective
+date of this ASU or (2) retrospectively to any or all prior periods presented in the financial statements. The Corporation is evaluating
+the effect that ASU 2024-03 will have on its consolidated financial statements and related disclosures.
+
+ 
+
+The Company does not believe other recently issued
+but not yet effective accounting standards, if currently adopted, would have a material effect on the Company s audited
+consolidated balance sheets, statement of operations and comprehensive loss and statement of cash flows.
+
+ 
+
+EXPOSURE TO FLUCTUATIONS IN EXCHANGE RATES AND
+RELATED HEDGES
+
+ 
+
+Our exposure to foreign currencies mainly arises from
+trade receipts from overseas clients. To mitigate the potential impact of currency fluctuations, we closely monitor our foreign currency
+exposures and use suitable hedging instruments when necessary. No foreign currency hedge contract was entered during 2021. As of September
+30, 2024 and September 30, 2023, we have no outstanding foreign currency hedge contracts.
+
+ 
+
+ 63
+
+ 
+
+ 
+
+ 
+
+INTEREST RATE RISK EXPOSURE
+
+ 
+
+The Company may be exposed to cash flow interest rate
+risk through the changes in interest rates related mainly to the Company s bank borrowings and bank balances. The Company currently
+does not have any interest rate hedging policy in relation to fair value interest rate risk and cash flow interest rate risk. The directors
+monitor the Company s exposures on an ongoing basis and will consider hedging the interest rate should the need arise.
+
+ 
+
+CONTINGENT LIABILITIES
+
+ 
+
+We have no material contingent liabilities as of
+September 30, 2024 and September 30, 2023.
+
+ 
+
+EMPLOYEE INFORMATION AND REMUNERATION POLICY
+
+ 
+
+As of the date of this prospectus, we have 23 employees
+(as of September 30, 2024: 23). Staff costs, including directors emoluments, amounted approximately to $790,000 for the
+year ended September 30, 2024, approximately $561,000 for the year ended September 30, 2023. Our remuneration policy is basically
+determined by the performance of individual employees. In general, salary reviews are conducted annually. Staff benefits, including medical
+coverage and retirement accounts, are also provided to employees. Commission is granted to Sales and Business Development team and Project
+Management team members if certain criteria are met.
+
+ 
+
+Industry Information
+
+ 
+
+Having described that barriers of entry of our industry
+are relatively low. We are facing competition from numerous small players in the industry which may be as small as sole
+propriety or companies. According to research being conducted by the Hong Kong Trade Development Council in May 2023, there
+are more than 3,700 marketing service establishments, both online and offline in Hong Kong.
+
+ 
+
+We believe our competitors with similar business in
+Hong Kong region shall be Guru Online and iClick. Guru Online is a public company in Hong Kong and iClick is a Nasdaq traded company.
+
+ 
+
+Our Competitive Strengths
+
+ 
+
+We believe that the following competitive strengths
+contribute to our success and set us apart from our competitors:
+
+ 
+
+ 
+ 
+ 
+ Comprehensive Service Offerings: Our comprehensive service offerings allow clients to access a diverse set of solutions from a single trusted partner. This integrated approach sets us apart from competitors who may offer limited services.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Tailor-made Solutions: We understand that every business is unique, and we tailor our strategies to meet the specific needs and challenges of each client.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Strong Network and Partnerships: We have strong client relationships that allow us to access top-quality resources, negotiate favorable rates, and deliver high-quality services to our clients. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Track Record of Success: We have a proven track record of delivering successful events and campaigns for a diverse range of satisfied clients.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Global Reach: We have a global network of partners and resources, enabling us to support clients in expanding their reach and achieving international success.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Low Turnover rate of Senior Staff: Our senior staff is experienced and with an average of working life with us for more than 7 years. We believe this can help build customers confidence in us.
+
+ 
+ 
+
+ 64
+
+ 
+
+ 
+
+ 
+
+Our Growth Strategy
+
+ 
+
+Our goal is to help clients and brands maximize their
+presents by establishing and managing one of the leading online media networks in Hong Kong and China. Accomplishing this goal depends
+on the following strategies:
+
+ 
+
+ 
+ 
+ 
+ Expand Service Offerings: Exploring opportunities in emerging digital marketing channels, such as influencer marketing or virtual events, to diversify our offerings and capture new market segments; 
+
+ 
+ 
+ 
+ Geographic Expansion: Targeting new regions or countries allows us to tap into new customer bases and leverage our expertise in different markets;
+
+ 
+ 
+ 
+ Strategic Partnerships and Acquisitions: Partnering with companies that offer synergistic services or have access to untapped markets, we can expand our capabilities and market reach. Acquisitions can also provide opportunities to integrate new talent, technologies, or client portfolios into our business;
+
+ 
+ 
+ 
+ Invest in Technology and Innovation: Investing in research and development to enhance our technological capabilities, leverage data analytics and AI-driven solutions, and explore emerging technologies such as virtual reality or augmented reality;
+
+ 
+ 
+ 
+ Enhance Marketing and Branding Efforts: A strong marketing and branding strategy is essential for growth. By effectively communicating our unique value proposition and differentiating ourselves from competitors, we can attract new clients and strengthen existing relationships; and
+
+ 
+ 
+ 
+ Continuous Learning and Development: Investing in employee training, industry certifications, and staying updated on industry trends allows us to offer the latest solutions and maintain a knowledgeable and skilled team.
+
+ 
+ 
+
+Our Challenges
+
+ 
+
+Our ability to execute our strategies and realize
+our vision is subject to risks and uncertainties that could impede our progress in the following key areas:
+
+ 
+
+ 
+ 
+ 
+ Maintaining our relationships with our business Brands, Partners and Vendors;
+
+ 
+ 
+ 
+ Generating and maintaining sufficient net cash inflows through our operating activities;
+
+ 
+ 
+ 
+ Attracting new clients, retaining existing clients, and deepening client relationships;
+
+ 
+ 
+ 
+ Improving our services to keep pace with rapidly changing demands, preferences, marketing trends, and technologies in marketing industry;
+
+ 
+ 
+ 
+ Enhancing cooperation with different partners;
+
+ 
+ 
+ 
+ Expanding and operating our business to encompass additional Asian countries;
+
+ 
+ 
+ 
+ Expanding our business in East Asia;
+
+ 
+ 
+ 
+ Innovating and growing new service offerings;
+
+ 
+ 
+ 
+ Recruiting and retaining talented and passionate supporting employees; and
+
+ 
+ 
+ 
+ Timing and resources in adopting and developing new technology into marketing services;
+
+ 
+ 
+
+We also face additional challenges, risks, and uncertainties
+that could materially and adversely affect our business, financial condition, results of operations, and prospects. The section on "Risk
+Factors" (pages 16–37) provides a more detailed discussion of the risks associated with investing in our shares.
+
+ 
+
+ 65
+
+ 
+
+ 
+
+ 
+
+HISTORY AND CORPORATE STRUCTURE
+
+ 
+
+Corporate Structure
+
+ 
+
+Our Company was incorporated
+in the Cayman Islands on March 20, 2024 under the Companies Act as an exempted company with limited liability. Upon completion of
+this offering, the authorized share capital of the Company is US$50,000 divided into 233,500,000 Class A Ordinary Shares
+of a par value of US$0.0002 each, and 16,500,000 Class B Ordinary Shares of a par value of US$0.0002 each. Class
+B Ordinary Shares are entitled to twenty (20) votes per share. Class A Ordinary Shares are entitled to one (1) vote per share.
+Each Class B Ordinary Share is convertible into one (1) Class A Ordinary Share at any time at the option of the holder thereof.
+
+ 
+
+Following incorporation of our
+Company, our Class A Ordinary Shares is held by Rich Choice Ventures Limited, Meta World Group Limited, Distinctive Idea Enterprise Limited,
+and Magic Summit Ventures Limited as to approximately 5.0%, 5.0%, 3.0% and 4.5% of the issued share capital of our Company, respectively.
+All of our Class B Ordinary Shares, approximately 82.5% of the issued share capital of our Company is owned by Tech Vision Investments
+Limited.
+
+ 
+
+Organization Chart
+
+ 
+
+The following chart summarizes our corporate structure upon completion of this offering (assuming
+the underwriter does not exercise its over-allotment option):
+
+ 
+
+ 
+
+Hong Kong Operating Subsidiaries
+
+ 
+
+MediaOn Limited ("MOHK")
+
+ 
+
+On July 27, 2011, MOHK was incorporated
+as a limited company in Hong Kong pursuant to the Companies Ordinance. MOHK is principally engaged in the advertising media services.
+As part of a group reorganization effective on July 29, 2024, MOHK became an indirect wholly-owned subsidiary of our Company.
+
+ 
+
+Mosaic Creative Company Limited ("Mosaic")
+
+ 
+
+On August 27, 2024, Mosaic was
+incorporated as a limited company under the laws of Hong Kong with a 55% shareholding by MediaOn. Mosaic is principally engaged in content
+creation for online media and short video streams. As a group reorganization was effective on July 29, 2024, Mosaic became an indirect
+55% controlled subsidiary, with the remaining 45% of shares owned by CHOY, Lap Pong Justin.
+
+ 
+
+More restructuring information
+was described in accompany Note 1 of accompanying financial statements.
+
+ 
+
+ 66
+
+ 
+
+ 
+
+ 
+
+Key Milestones
+
+ 
+
+The key milestones in the development
+of our Group are highlighted chronologically below:
+
+ 
+
+ 
+ Year
+ 
+ Milestones
+
+ 
+ 
+ 
+ 
+
+ 
+ 2011
+ 
+ MOHK Founded focusing on content management, media platforms and marketing services of key global search engines.
+
+ 
+ 
+ 
+ 
+
+ 
+ 2012
+ 
+ Team members expanded from 8 to 20 staff including business development, marketing and editor partnership with global search engines on reselling advertisement and operating advertisement network monetization 
+
+ 
+ 
+ 
+ 
+
+ 
+ 2013
+ 
+ Established influencer Market Intelligence Platform WeShare.hk
+
+ 
+ 
+ 
+ 
+
+ 
+ 2014
+ 
+ WeShare.hk, won Best.hk Website Awards & HSBC Youth Business Award Operating over 10 Media Content Platforms to facilities client s influencer s marketing campaign Diversify marketing services from search engines to social media on content management, influencer campaign and advertisement placement
+
+ 
+ 
+ 
+ 
+
+ 
+ 2015
+ 
+ MOHK established a joint venture with Taiwan top parenting platform Mamibuy in Hong Kong
+
+ 
+ 
+ 
+ 
+
+ 
+ 2016 -2021
+ 
+ MOHK well established a marketing services agency position offering comprehensive services from online to offline (O2O), from branding, creative to ad placement
+
+ 
+ 
+ 
+ 
+
+ 
+ 2022 - Present
+ 
+ 
+ Establish a social listening platform – Soda Insight
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Further expand the marketing service scopes to event organizing, production, video and animation, and AI creative marketing
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Joint-Venture with Mosaic and Common People & Production Limited (subsequent event to the fiscal year ended September 30, 2024) to further expand the market penetration
+
+ 
+ 
+
+ 67
+
+ 
+
+ 
+
+ 
+
+INDUSTRY OVERVIEW
+
+ 
+
+All the information and data presented in this
+section have been derived from Frost & Sullivan Limited ("Frost & Sullivan") s industry report commissioned
+by us entitled "Hong Kong and Asia Pacific Marketing Services Market Study" dated April 11, 2025 (the "Frost & Sullivan
+Report") unless otherwise noted. Frost & Sullivan has advised us that the statistical and graphical information contained herein
+is drawn from its database and other sources. The following discussion contains projections for future growth, which may not occur at
+the rates that are projected or at all.
+
+ 
+
+OVERVIEW OF MARKETING SERVICES MARKET IN HONG KONG
+
+ 
+
+Definition and Classification
+
+ 
+
+Marketing Services are professional services provided
+by marketing agencies that help businesses (clients) to develop and implement strategies to effectively promote their products, services,
+or brand to their target audience both online and offline. These services focus on communicating the client s value to customers
+through various channels and touchpoints. The main objective of marketing services is to help businesses attract, retain, and grow their
+customer base by understanding their needs, preferences, and behaviors, and creating tailored marketing strategies to reach them effectively.
+These services can be divided into two main categories: digital marketing and offline marketing.
+
+ 
+
+ 
+
+ 
+
+Source: The Frost & Sullivan Report
+
+ 
+
+ 68
+
+ 
+
+ 
+
+ 
+
+Value Chain
+
+ 
+
+ 
+
+Source: The Frost & Sullivan Report
+
+ 
+
+In the upstream, marketing software providers, data
+management platforms (DMPs), and third-party consumer data providers supply the necessary tools, technologies, and data insights that
+form the foundation of modern marketing campaigns. Marketing software providers develop and offer a wide range of solutions, such as marketing
+automation software, analytics tools. DMPs, on the other hand, focus on collecting, storing, and analyzing vast amounts of audience data
+from various sources. Third-party consumer data providers complement these efforts by gathering, analyzing, and supplying valuable market
+research and consumer insights.
+
+ 
+
+Midstream marketing services companies develop compelling
+visual, audio, and written content, formulating online strategies leveraging online channels such as search engines, social media, and
+email and organize and execute promotional events, product launches, and experiential marketing initiatives. The Group is engaged
+in the provision of marketing services in the midstream of the value chain. Media Owners, such as websites, social media platforms,
+television networks, and print publications, are the entities that own and operate the channels where advertising content is displayed,
+while demand side platforms are platforms that enable advertisers and agencies to buy advertising inventory from multiple sources and
+supply side platforms are platforms that help media owners manage and sell their advertising inventory to potential buyers.
+
+ 
+
+Brand owners are companies that operate across various
+industries, such as fast-moving consumer goods (FMCG), electronics, fashion, and finance, and utilize the services provided by the midstream
+players to promote their products or services. These brand owners work closely with marketing services companies to develop and implement
+marketing strategies that effectively communicate their brand message, engage their target audience, and drive sales. Consumers are the
+target audience for marketing campaigns and are exposed to a wide range of marketing messages across various channels, including online,
+offline, and experiential touchpoints.
+
+ 
+
+Market Size of Online Marketing Services
+
+ 
+
+The market size of online marketing services
+in Hong Kong has experienced significant growth in recent years, driven by factors such as high internet and mobile penetration
+rates, increasing digital ad spending, and a growing e-commerce market. The market size of online marketing services in Hong Kong
+has increased from HKD2,033.7 million in 2019 and further increased to HKD3,526.2 million by 2024, representing a CAGR of
+approximately 11.6% during 2019 to 2024. The growth is projected to continue, with the market size expected to reach HKD4,699.1
+million by 2029, indicating a CAGR of approximately 5.7% during 2025 to 2029. The ongoing shift in consumer behavior towards digital
+channels and the increasing adoption of online marketing strategies by businesses in Hong Kong are expected to drive the continued
+expansion of the online marketing services market in the coming years.
+
+ 
+
+ 69
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+Source: The Frost & Sullivan Report
+
+ 
+
+Market Size of Offline Marketing Services
+
+ 
+
+In 2020, the restrictions on public gatherings
+and events, as well as the overall economic downturn, led to a decline in demand for offline marketing services. Despite these challenges,
+the market has recovered and reached HKD2,395.6 million by 2024, representing a CAGR of approximately 3.8% from 2019 to 2024. As the
+economy recovers and businesses adapt to the post-pandemic landscape, the offline marketing services market is expected to continue growing,
+albeit at a slower pace compared to the online segment. . By 2029, the market size is projected to reach HKD 2,771.7 million, with a
+CAGR of approximately 2.8% between 2025 and 2029. Despite the shift towards digital channels, the demand for events, expos, and outdoor
+displays is still growing, indicating that offline marketing services continue to play a significant role in the overall marketing mix
+in Hong Kong.
+
+ 
+
+ 
+
+ 
+
+Source: The Frost & Sullivan Report
+
+ 
+
+Market Drivers Analysis
+
+ 
+
+Continuous Adoption of Search Engine Optimization
+(SEO) in Marketing Strategy: SEO remains a foundational market driver in Hong Kong s marketing services market, as
+businesses recognize the importance of organic search traffic in driving website visits, generating leads, and converting customers. In
+Hong Kong s highly competitive online landscape, a strong SEO strategy is essential for businesses to stand out and attract qualified
+traffic. As AI and machine learning advance, SEO in Hong Kong is expected to become more sophisticated, emphasizing high-quality, relevant
+content that meets the growing importance experience, expertise, authoritativeness, and trustworthiness. The increasing adoption of voice
+search and local search will also drive demand for specialized SEO services, such as optimizing content for natural language queries and
+improving visibility in local search results. Marketing service providers that offer comprehensive SEO solutions, combining technical
+expertise with content creation and local search optimization, will be well-positioned to help clients achieve sustainable growth through
+organic search traffic in the evolving Hong Kong market.
+
+ 
+
+ 70
+
+ 
+
+ 
+
+ 
+
+Rising Incidence of Influencer Marketing:
+Hong Kong s vibrant social media landscape, dominated by platforms including Instagram, Thread, Facebook, and YouTube, has given
+rise to a diverse array of local influencers across various niches. Businesses are increasingly partnering with these influencers to promote
+their products and services, leverage their credibility, and tap into their engaged communities. Influencer marketing has proven particularly
+effective in Hong Kong s competitive retail, beauty, and lifestyle sectors. Marketing service providers that offer strategic influencer
+marketing solutions will be well-positioned to help clients capitalize on this rising trend in the dynamic Hong Kong market.
+
+ 
+
+Conversion Advertisement and Dynamic Advertisements:
+The integration of promotions with conversion ads and dynamic ads has emerged as a powerful market driver in Hong Kong s
+marketing services market. As businesses strive to maximize their online sales and ROI, they are increasingly leveraging these advanced
+advertising tools to deliver personalized, targeted promotions to high-intent consumers. Hong Kong s tech-savvy population and high
+mobile penetration rate provide an ideal environment for these ads to be effective. By combining promotional offers with conversion-focused
+ad formats and dynamic, real-time ad personalization, businesses can drive higher click-through rates, lower cost-per-acquisition, and
+ultimately, boost their online sales. Marketing service providers in Hong Kong that can offer expertise in conversion ad optimization,
+dynamic ad creation, and promotional strategy will be well-positioned to help clients capitalize on this market driver and achieve their
+e-commerce goals in the competitive Hong Kong market.
+
+ 
+
+Market Trend and Opportunities Analysis
+
+ 
+
+Importance of Personalization in Reaching End
+Customers: Personalization has become a crucial market driver in Hong Kong s marketing services market, fueled by
+the city s tech-savvy consumers and robust digital infrastructure. Companies are leveraging vast consumer data from popular social
+media platforms such as Facebook and Instagram to deliver highly targeted marketing messages across multiple touchpoints. Personalization
+is particularly effective in Hong Kong s competitive retail and hospitality sectors, helping brands stand out and build loyalty.
+However, the city s stringent data privacy regulations require companies to ensure compliance and maintain customer trust. Marketing
+service providers that can offer innovative personalization solutions while navigating the regulatory landscape will be well-positioned
+to capitalize on this growing trend in the dynamic Hong Kong market.
+
+ 
+
+Prevailing Video Content: The
+rise of video content has become a significant market driver in Hong Kong s marketing services market. As consumers increasingly
+prefer video content, especially short-form videos on platforms like YouTube Shorts, Instagram posts and reels, as well as burgeoning
+platforms such as Xiaohongshu and TikTok, businesses are incorporating video into their marketing strategies to capture attention and
+drive engagement. Hong Kong s high smartphone penetration rate and fast mobile internet speeds have further fueled the demand for
+mobile-friendly video content. Live-streaming and interactive video content have also opened up new avenues for real-time customer engagement.
+With video production becoming more accessible and cost-effective through technological advancements and AI-powered tools, marketing service
+providers that offer innovative video content solutions will be well-positioned to help clients stand out in the competitive Hong Kong
+market.
+
+ 
+
+MarTech Continue to Evolve:
+Businesses in Hong Kong are leveraging MarTech solutions such as marketing automation platforms, data analytics tools, and AI-powered
+chatbots to optimize marketing efforts, improve customer engagement, and drive better results. The strong digital infrastructure and high
+adoption rate of mobile and online technologies in Hong Kong provides a conducive environment for MarTech to thrive. Marketing service
+providers that offer expertise in MarTech implementation, integration, and optimization will be well-positioned to help clients navigate
+this complex landscape and achieve their marketing goals in the dynamic Hong Kong market.
+
+ 
+
+ 71
+
+ 
+
+ 
+
+ 
+
+Market Risk Analysis
+
+ 
+
+Intensifying Market Competition:
+The digital marketing landscape in Hong Kong is highly competitive, with a large number of businesses and agencies competing for audience
+attention and market share across various platforms and channels. The crowded market poses significant challenges for players looking
+to establish a strong presence and differentiate themselves from competitors. Besides, some large corporates are constantly expanding
+their internal marketing team, which may also erode the market share of third party marketing services agency. In view of the intensifying
+market competition, agencies must focus on developing innovative, targeted, and cost-effective strategies that leverage their unique strengths
+and value propositions.
+
+ 
+
+Fragmented Audience and Difficulty in Measuring
+Return on Investment (ROI): With a diverse population and a wide range of online platforms, reaching and engaging target
+audiences effectively can be a complex and resource-intensive task. Marketers must navigate a fragmented media landscape and develop strategies
+that cater to different audience segments across multiple channels. Additionally, demonstrating the ROI of digital marketing efforts can
+be challenging, particularly for businesses that lack the necessary tracking and analytics tools. To overcome these challenges, and agencies
+must invest in robust audience research, multi-channel strategies, and advanced analytics tools to effectively reach and engage their
+target audiences.
+
+ 
+
+OVERVIEW OF MARKETING SERVICES MARKET IN ASIA PACIFIC
+
+ 
+
+Market Size of Online Marketing Services
+
+ 
+
+The market size of the online marketing service
+in Asia Pacific has increased at a compounded annual growth rate ("CAGR") of 8.8% from US$136.4 billion in 2019 to US$207.8
+billion in 2024, driven by the growing internet users base, rising middle class and digital consumption.
+
+ 
+
+Looking forward, the mobile marketing segment,
+in particular, would continue to a catalyst for the growth. With over 80% of APAC s internet users accessing the web via smartphones,
+mobile ad spend has surged exponentially. The economic growth is expected to stimulate consumer demand and prompt brands and distributors
+to invest more in retail sales and marketing services. The online marketing market in Asia Pacific is expected to grow at a CAGR of 7.6%
+between 2025 and 2029, reaching US$299.7 billion in 2029.
+
+ 
+
+ 
+
+Source: The Frost & Sullivan Report
+
+ 
+
+ 72
+
+ 
+
+ 
+
+ 
+
+Market Size of Offline Marketing Services
+
+ 
+
+The market size of offline marketing services
+in Asia Pacific has increased at a CAGR of 4.8% from US$155.3 billion in 2019 to US$196.2 billion in 2024. The market size of offline
+marketing services decreased from 2020 to 2022 due to multiple interruptions of offline conventions and exhibitions and on-site sales
+activities caused by the Covid-19, particularly in the PRC. However, as offline marketing remains an important channel for companies
+to interact directly with consumers, build brand awareness and promote their products, the offline marketing activities were able to
+resume after the epidemic receded since 2023, and it is projected that the market size will grow steadily after 2023, from US$216.5 billion
+in 2025 to US$237.8 billion in 2029, with the CAGR of 2.4%.
+
+ 
+
+ 
+
+Source: The Frost & Sullivan Report
+
+ 
+
+Market Drivers and Trends Analysis
+
+ 
+
+Growing Mobile Internet Users and Changing
+Customer Behavior: The number of mobile internet subscribers in Asia Pacific reached approximately 1.8 billion in 2023,
+marking a substantial growth6 compared to 700 million in 2015. This growth is attributed to the widespread adoption of smartphones. Countries
+like The PRC, India, and Indonesia have the contributed to the growth of digital consumer bases in the PRC. In line with the trend of
+rapid digitalization and increasing affordability of internet-enabled devices, there is an increase in use of internet and smartphone
+across Asia Pacific, which has increased the demand for online marketing services. In particular, due to the rise of mobile live streaming
+applications and proliferation of short video channels in Asia Pacific, mobile live streaming platforms have become increasingly important
+with strong growth potentials. Consumers in the Asia Pacific, especially the young and urban demographics, have embraced a mobile-first
+and digitally-driven lifestyle. In response to the evolving market demand, marketers are adopting online marketing strategies to effectively
+reach and engage this digitally-savvy consumer base.
+
+ 
+
+Growth of Digital Platforms and Ecosystems:
+Asia Pacific has seen the emergence of dominant local tech giants, social media platforms, e-commerce players, and other digital content
+providers, leading to the growth of digital platforms and ecosystems Meanwhile, recent years have witnessed an increasing number of apps
+and UGC platforms that combine social media with e-commerce platforms and encourage users to give reviews and opinions of products, contributing
+to the rising influence of self-media and KOLs (Key Opinion Leaders) and KOCs (Key Opinion Consumers). Such UGC apps and platforms enable
+community-based content sharing and communication-based content flowing, turning marketing campaign into a two-way interactive activity
+with the rising participation of consumers. Such characteristics are becoming increasingly advantageous in marketing campaigns and, therefore
+are driving the growth of online marketing services in Asia Pacific.
+
+ 
+
+Technological Advancement in Marketing Services
+Sector: The proliferation of artificial intelligence, data learning, virtual reality, and augmented reality technologies
+has facilitated the digitization of marketing. As a result, marketing service providers can automate the advertising resource purchasing
+workflow via programmatic ads, thereby enhancing placement efficiency. To increase customer engagement and the purchasing process, marketing
+service providers may also offer consumers novel interactions and experiences through the use of virtual excursions, virtual fitting rooms,
+and immersive product demonstrations. The expansion of technological tools and opportunities in the marketing services industry has resulted
+in more precise, intelligent, and innovative marketing. Additionally, it enables marketing service providers to deliver more streamlined
+and customized marketing solutions.
+
+ 
+
+ 73
+
+ 
+
+ 
+
+ 
+
+Continuous technological application is expected
+to favour market participants with robust technical and digital competencies: The increasing adoption of new technologies,
+including big data analytics, artificial intelligence (AI) algorithms, the Internet of Things (IoT), and cloud computing, will provide
+substantial growth opportunities for the marketing services industry. For example, market participants equipped with AI algorithms and
+big data analytics will have the capability to forecast consumer preferences more accurately and deliver superior customized marketing
+strategies. It is noteworthy that several significant domestic AI models were introduced and implemented in 2023, providing substantial
+support for the development and deployment of various vertical sub-models. Concurrently, the Chinese government issued the Interim Measures
+for the Management of Generative Artificial Intelligence Services 2023 (2023 AIGC Interim Measures) ( 
+) in the same year, with the intention of encouraging diverse industries to fully implement generative AI technologies. These technological
+advancements and regulatory measures pave the way for more precise marketing solutions and the adoption of more sophisticated digital
+technologies in the future. The marketing services industry is poised to benefit greatly from the increasing integration of these new
+technologies, enabling more targeted, data-driven, and personalized marketing strategies to cater to the evolving needs of consumers in
+the Asia Pacific.
+
+ 
+
+Increasing consumer preference towards online
+shopping: In recent years, with the acceleration of internet speed and the development of information infrastructure, consumers
+in Singapore are becoming increasingly digital-savvy and using personal electronic devices to browse and make purchases online. The outbreak
+of COVID-19 further accelerated this trend, as consumers avoid unnecessary social contact and shift their preferences to online shopping,
+especially for groceries and personal hygiene products. In Asia Pacific, value for money, ease of shopping experience, and brand credibility
+are important criteria for consumers, and e-commerce platforms that continuously enhance these aspects can meet the requirements of customers
+and drive the preference towards online shopping in the coming years. The e-commerce boom has led to a rising number of brands, startups,
+and small-to-medium enterprises looking to establish an online presence, which increases the demand for online marketing services.
+
+ 
+
+Market Risk Analysis
+
+ 
+
+Lack of experienced industry talents :
+There is a strong demand for individuals with professional knowledge and expertise in data analytics and artificial intelligence, as well
+as creative planning abilities and an in-depth understanding of the industry s development dynamics, user needs, and market opportunities,
+in Asia Pacific s marketing services sector, which has experienced substantial growth in recent years. Due to the absence of structured
+talent development programs for small and medium-sized enterprises in Asia Pacific and the tendency of talent towards larger enterprises,
+certain marketing service providers in the country may face obstacles in their growth due to the talent deficit on the market.
+
+ 
+
+Intensifying market competition and diversified
+demand impose challenges to market participants: The marketing services sector in Asia Pacific is highly competitive and
+fragmented, with a large number of small and medium-sized companies. With the emergence of competitors possessing extensive expertise
+and experience in technology, media channels, and other domains, market competition intensifies, posing difficulties for market participants
+in their efforts to expand and maintain their businesses. Simultaneously, there is a growing variety of customer sectors requesting marketing
+solutions, and in a market environment characterized by intense competition and customers increased bargaining power, marketing
+service providers are compelled to enhance their business capabilities and expand their channels of customer acquisition. In fact, they
+may even be required to augment their customer acquisition efforts.
+
+ 
+
+COMPETIVE LANDSCAPE OF MARKETING SERVICES
+
+ 
+
+Competition Overview
+
+ 
+
+The marketing services market in Hong Kong is
+highly competitive with approximately 3,700 market participants. The top three market participants account for 4.6% of market share by
+revenue in 2024. Our Group has a market share of 0.4% with the revenue of HKD21.6 million in the marketing services market in terms of
+revenue in 2024 in Hong Kong.
+
+ 
+
+ 
+
+Source: The Frost & Sullivan Report
+
+ 
+
+ 74
+
+ 
+
+ 
+
+ 
+
+Entry Barriers
+
+ 
+
+Brand reputation and awareness: Access
+to advertisers, media and marketing channels is critical for marketing services, which requires good brand reputation and awareness. Given
+the successful project delivery and proven track record, existing marketing services providers are expected to have already established
+their reputation and brand awareness, which is hardly achieved by the new entrants. With a sound reputation, some companies are on preferred
+lists of enterprises. Moreover, leading existing market participants with good brand reputation and marketing channels are more attractive
+for new clients and able to retain their existing clients. Hence new entrants may need extra effort and time to acquire business from
+clients. Therefore, existing market players are more competitive in terms of expansion of business network and exploration of new clients.
+
+ 
+
+Professional skills and team with innovative
+capabilities: The deployment of marketing campaigns requires sufficient professional skills on marketing and industry knowledge,
+such as in-depth knowledge of marketer , ' ': s industry, execution capability and planning, since these are tailor-made services based
+on the specific needs and requirements of customers. Moreover, as the core competitiveness of such marketing services providers lies in
+innovation and creativity for planning of marketing services, professional talents with innovative abilities and experience are required.
+Having skilled talents with profound industry expertise and an innovative mind who are able to manage various new and evolving resources
+and provide specific and precise marketing services to clients are invaluable assets in the market. Leading existing market participants
+usually have ability to provide better remuneration package and career opportunities, thereby standing a better chance of recruiting innovative
+and experienced talents. Combined with the growing demand for marketing and the shortage of experienced staff, the recruitment of talent
+would serve as a entry barrier to marketing industry.
+
+ 
+
+Client Relationship Management: Effective
+client relationship management plays a crucial role in fostering strong client relationships, resulting in trust and a positive industry
+reputation. Established marketing service providers typically boast a history of successful campaigns and satisfied clients, enabling
+them to comprehend and fulfill client needs efficiently. Through consistent outcomes and exceptional customer service, these providers
+can retain clients over the long haul, posing a challenge for new entrants seeking to compete against established players with well-established
+client relationships.
+
+ 
+
+Factors of Competition
+
+ 
+
+Strategic Planning and Execution:
+Strategic planning enables marketing service providers to identify their distinctive value proposition and target specific market
+segments. By comprehending customer requirements and preferences, organizations can set themselves apart from competitors and position
+their services effectively. This strategic positioning establishes a competitive edge, attracting customers who align with the company s
+offerings. However, the effectiveness of strategic planning relies on its successful execution. Execution excellence encompasses the efficient
+and effective implementation of marketing strategies and initiatives. This necessitates adept project management, seamless coordination
+among diverse teams and departments, and a steadfast commitment to delivering desired outcomes. Companies that excel in execution can
+secure a competitive advantage by consistently providing high-quality marketing services and surpassing customer expectations.
+
+ 
+
+Technological capabilities: Technological
+capabilities including data collection, data processing, data analysis, and recent developments in cloud computing, machine learning (ML)
+and artificial intelligence (AI) technologies form key factors of competition in the marketing services market. In particular, AI algorithms
+process and analyze customer data to identify patterns and segments, allowing marketers to target specific customer groups with personalized
+messages and offers. This improves the effectiveness of marketing campaigns and enhances customer satisfaction. As such, market participants
+who are capable of dealing with massive amount of data and creating added value to its customers can prosper in the market.
+
+ 
+
+Continuous Learning and Adaptation:
+The marketing industry is in a constant state of change, with new strategies, tools, and platforms emerging regularly. Through continuous
+learning, marketing professionals can stay up-to-date with the latest trends and best practices, enabling them to develop innovative strategies
+and maintain a competitive edge over rivals who may be using outdated methods. By adapting their approaches to align with evolving consumer
+behaviors, successful marketing service providers can create campaigns that are more relevant and effective, thereby gaining a competitive
+advantage.
+
+ 
+
+ 75
+
+ 
+
+ 
+
+ 
+
+BUSINESS
+
+Overview
+
+ 
+
+Our
+business operations are categorized into the following three business streams:
+
+ 
+
+Media
+Rebates
+
+ 
+
+This business stream contributes for 42.81% of
+the overall revenue in 2024 and 77.58% in 2023. The media rebates are generated
+when we do advertising placements in various media platforms of which the media placements are operated by these platforms and we act
+as an agent in these transactions, through our collaborations with both direct clients and agency clients. The client clients are those
+we serve and support directly while agency clients act as intermediaries who have their own clients and channels.
+
+ 
+
+Rebates
+generation:
+
+ 
+
+ Media
+ platforms offer volume-based rebates or bonuses. These volume-based rebates or bonuses
+ refer to incentive payments as media rebates that MediaOn received directly from the media
+ platforms when cumulative advertising spending routed through MediaOn meets pre-determined
+ spending thresholds within a contractual period (typically a fiscal year or contract year).
+
+ 
+
+ And
+ these rebates are calculated based on:
+
+ 
+
+ 
+ 
+ Tiered spending levels set by the media platform (e.g., HKD/USD advertising spend levels)
+
+ 
+ 
+ Percentage rebate rates assigned to each tier, depending on different platform offering
+
+ 
+ 
+ Actual qualifying media spending achieved during the
+ fiscal year or contract year.
+
+ 
+
+ MediaOn
+ aggregates advertising spending from multiple clients to negotiate favorable rebate
+ agreements with media suppliers.
+
+ 
+
+Rebates typically range from 5.0% to 30% of the qualifying
+media spending, depending on platform agreements and campaign performance. Qualifying media spending refers to:
+
+ 
+
+ 
+ 
+ Total advertising expenses booked through MediaOn on participating media platforms
+
+ 
+ 
+ Spending from all relevant client campaigns aggregated together
+
+ 
+ 
+ Advertising categories
+ that the platform allows to be counted toward rebate calculation (e.g., native advertisement, programmatic advertisement, sponsored
+ placements)
+
+ 
+
+Revenue
+Recognition and Timing:
+
+ 
+
+ Media
+ rebates are recognized
+ over time, aligned with the delivery schedule and non-cancellable nature of the related advertising
+ campaigns.
+
+ MediaOn
+ records rebate income when the cumulative spendings reaches the applicable tier and are recognized as revenue when collection becomes probable.
+
+ 
+
+Supplier
+and Customer Concentration:
+
+ 
+
+ In
+ fiscal 2024, Customer A, representing rebate income directly from a major media platform,
+ accounted for 42.29% of total company revenues. In the same period, Media Rebates as a business
+ stream contributed 42.81%, indicating that nearly all of the rebate income originated from
+ this single source..
+
+ 
+
+Media
+Placement
+
+ 
+
+This business stream contributes for 7.36% of the
+overall revenue in 2024 and 4.67% in 2023. We offer media planning, potential media spendings and performance services in various platforms
+according to the requirement of our customers. While providing these services, commissions and any related fulfillment fees can we earn
+from these arrangements after the services are rendered. Same as "Media Rebates", the media placements are operated and
+executed by our suppliers which include online advertising platforms (e.g. Google, Meta) , local resellers accredited by major
+platforms and outdoor and transit media owners (billboard networks, TV stations, etc), and we act as an agent in these transactions.
+The services provided by these platforms or owners include:
+
+ 
+
+ Paid
+ search and display advertising (e.g., Google, YouTube)
+
+ Social
+ media advertising (e.g., Facebook, Instagram)
+
+ Programmatic
+ advertising and ad tech execution
+
+ Outdoor
+ and transit media (e.g., billboards, TV, buses)
+
+ 
+
+Since media placements are operated and executed
+by our suppliers, therefore:
+
+ 
+
+ 
+ 
+ 
+ The
+ media platforms (e.g., Google, Meta) operate the advertising infrastructure where the advertisements are purchased and delivered.
+
+ 
+ 
+ 
+ MediaOn
+ does not control or operate the advertisement delivery mechanism.
+
+ 
+ 
+ 
+ MediaOn
+ co-ordinates with the media platform on the placement but the actual advertisement serving, targeting, and billing system are all
+ operated by that platform.
+
+ 
+ 
+
+Revenue
+Recognition and Pricing Model:
+
+ 
+
+ MediaOn
+ earns agency fees or commissions for planning, buying, and executing media placements.
+
+ Revenue
+ is recognized on a net basis when MediaOn does not assume control of the media inventory,
+ consistent with the agent model under ASC 606.
+
+ Agency
+ fees are typically calculated as a fixed percentage of media spend or via a flat project
+ fee.
+
+ 
+
+Also,
+MediaOn enters into standardized media placement service agreements with customers. The typical material terms include:
+
+ 
+
+ 
+ 
+ 
+ Scope
+ of media planning and execution services
+
+ 
+ 
+ 
+ Platform(s)
+ on which advertisements will be purchased
+
+ 
+ 
+ 
+ Client-approved
+ advertising budgets
+
+ 
+ 
+ 
+ Commission
+ or agency fee structure (percentage-based or fixed fee)
+
+ 
+ 
+ 
+ Billing
+ schedule (prepayment or monthly billing)
+
+ 
+ 
+ 
+ Responsibility
+ for reporting and performance analytics
+
+ 
+ 
+ 
+ Limitations
+ of liability and confidentiality provisions
+
+ 
+ 
+
+For
+contracts and customer base, MediaOn does not take title to the ad inventory but arranges placements through direct or indirect media
+supplier relationships. Clients include brand owners, PR agencies, and third-party marketing firms.
+
+ 
+
+ 76
+
+ 
+
+ 
+
+ 
+
+Marketing
+Campaign
+
+ 
+
+This
+business stream accounted for 49.83% of the overall revenue in 2024 and 17.75% in 2023. The revenue is generated from a broad spectrum
+of integrated advertising, branding, and promotional services. These services are typically project-based and include:
+
+ 
+
+ 
+ 
+ 1.
+ Social
+ Media Marketing – Includes KOL Marketing, Forum Seeding, Chatbots, Social Media Listening Tools, etc.
+
+ 
+ 
+ 2.
+ Search
+ Engine & Media Buy – Includes SEM, Display Ads, Programmatic Buy.
+
+ 
+ 
+ 3.
+ AI
+ & Interactive – AR/VR experiences and interactive media.
+
+ 
+ 
+ 4.
+ Multimedia
+ Creation – Includes video, animation, and creative design.
+
+ 
+ 
+ 5.
+ Event
+ Management – Event planning, logistics, AV production.
+
+ 
+ 
+ 6.
+ Outdoor
+ Marketing – DOOH, TVC Ads, transit advertising.
+
+ 
+ 
+
+Revenue
+Recognition and Pricing Model:
+
+ 
+
+ Revenue
+ is recognized over time for services delivered on a retainer or progressive milestone basis.
+
+ Revenue
+ is recognized upon completion for one-time projects with clearly defined deliverables.
+
+ Fees
+ are calculated based on fixed project quotes, hourly service rates, or performance-based
+ pricing where applicable.
+
+ 
+
+For
+the contracts and customer base, we typically enter into written service agreements outlining scope, timelines, deliverables, and payment
+milestones. Our customers include private enterprises, listed companies, public sector agencies, and marketing agencies acting on behalf
+of brands.
+
+ 
+
+The
+standard or typical terms of marketing campaign service agreements include:
+
+ 
+
+Scope
+of Work: depending on the nature of marketing campaign(s) which customer requested.
+
+ 
+
+ 
+ 
+ 
+ Creative
+ development
+
+ 
+ 
+ 
+ Event
+ production
+
+ 
+ 
+ 
+ Social
+ media management
+
+ 
+ 
+ 
+ KOL/influencer
+ coordination
+
+ 
+ 
+ 
+ Web/technical
+ development
+
+ 
+ 
+
+Deliverables
+& Timelines
+
+ 
+
+ 
+ 
+ 
+ Defined
+ project milestones
+
+ 
+ 
+ 
+ Deliverable
+ acceptance checkpoints
+
+ 
+ 
+ 
+ Final
+ output specifications (e.g. video formats, event rundown)
+
+ 
+ 
+
+Pricing
+& Payment
+
+ 
+
+ 
+ 
+ 
+ Fixed
+ project fee or milestone-based payments
+
+ 
+ 
+ 
+ Retainer-based
+ fees for recurring engagements
+
+ 
+ 
+ 
+ Deposit
+ requirements
+
+ 
+ 
+
+Ownership
+& IP
+
+ 
+
+ 
+ 
+ 
+ Rights
+ to creative materials (depending on client terms)
+
+ 
+ 
+ 
+ Confidentiality
+ obligations
+
+ 
+ 
+
+Change
+Orders
+
+ 
+
+ 
+ 
+ 
+ Formal
+ procedure for scope or budget changes
+
+ 
+ 
+
+Termination
+
+ 
+
+ 
+ 
+ 
+ Termination
+ for convenience or cause
+
+ 
+ 
+ 
+ Payment
+ for work completed to date
+
+ 
+
+ 
+
+ 77
+
+ 
+
+ 
+
+ 
+
+1.Social
+ Media Marketing
+
+ 
+
+Our
+social media marketing consists of the following products and services:
+
+ 
+
+ 
+ 
+ 
+ KOL
+ Marketing : Paid Influencer promotion and often paid posts on social media
+
+ 
+ 
+ 
+ Forum
+ Seeding : Planting content in online forums to stimulate organic conversation.
+
+ 
+ 
+ 
+ TVC
+ Advertising: Producing and broadcasting traditional TV commercials
+
+ 
+ 
+
+2.Search
+ Engine & Media Buy
+
+ 
+
+Our
+search engine and media buy segment consists of the following products and services:
+
+ 
+
+ 
+ 
+ 
+ Search
+ Engine Marketing
+
+ 
+ 
+ 
+ Creative
+ Design
+
+ 
+ 
+ 
+ Display
+ Advertising
+
+ 
+ 
+ 
+ Data
+ Driven Marketing
+
+ 
+ 
+ 
+ Programmatic
+ Buy
+
+ 
+ 
+ 
+ Video
+ Marketing
+
+ 
+ 
+
+3.AI
+ & Interactive
+
+ 
+
+Our
+AI and interactive segment consists of the following products and services:
+
+ 
+
+ 
+ 
+ 
+ Augmented
+ Reality (AR)
+
+ 
+ 
+ 
+ Virtual
+ Reality (VR)
+
+ 
+ 
+ 
+ Immersive
+ 2D/3D Experience
+
+ 
+ 
+ 
+ Interactive
+ Motion Experience
+
+ 
+ 
+
+4.Multimedia
+ Creation
+
+ 
+
+Our
+multimedia creation segment consists of the following products and services:
+
+ 
+
+ 
+ 
+ 
+ Video
+ & Animation
+
+ 
+ 
+ 
+ Creative
+ Design
+
+ 
+
+5.Event
+ management
+
+ 
+
+Our
+event management segment consists of the following products and services:
+
+ 
+
+ 
+ 
+ 
+ Strategic
+ Planning
+
+ 
+ 
+ 
+ Venue
+ and Logistics Arrangement
+
+ 
+ 
+ 
+ Exhibition
+ Booth and Seminar Production
+
+ 
+ 
+ 
+ On-site
+ Event Management
+
+ 
+ 
+ 
+ AV
+ Production
+
+ 
+ 
+ 
+ Public
+ Relation Management
+
+ 
+ 
+
+6.Outdoor
+ Marketing
+
+ 
+
+Our
+outdoor marketing segment consists of the following products and services:
+
+ 
+
+ 
+ 
+ 
+ Digital
+ out of home (DOOH)
+
+ 
+ 
+ 
+ Billboard
+ Advertising
+
+ 
+ 
+ 
+ TVC
+ Advertising
+
+ 
+ 
+ 
+ Transit
+ Advertising
+
+ 
+
+ 
+
+Competitive Strengths
+
+ 
+
+We believe our competitive strengthens
+lie with the following:
+
+ 
+
+ 
+ 
+ 
+ Comprehensive Service Offerings: Our comprehensive service offerings allow clients to access a diverse set of solutions from a single trusted partner. This integrated approach sets us apart from competitors who may offer limited services.
+
+ 
+ 
+ 
+ Tailor-made Solutions: We understand that every business is unique, and we tailor our strategies to meet the specific needs and challenges of each client.
+
+ 
+ 
+ 
+ Experienced Team: Our team comprises seasoned marketing professionals with a proven track record of success across various industries.
+
+ 
+ 
+ 
+ Deep Industry Expertise: With years of experience in the media and event management industry, we boasts deep industry expertise.
+
+ 
+ 
+ 
+ Innovative and Creative Approach: By constantly embracing new technologies and creative strategies, we stay ahead of the curve and provide innovative solutions that differentiate us from competitors.
+
+ 
+ 
+ 
+ Data-Driven Approach: We leverage data analytics to gain a deeper understanding of target audiences, optimize campaign performance, and measure ROI effectively.
+
+ 
+ 
+ 
+ Technological Expertise: We leverage advanced analytics, AI-driven tools, and digital platforms to optimize marketing strategies, enhance campaign performance, and deliver data-driven insights to our clients
+
+ 
+ 
+ 
+ Strong Network and Partnerships: We has strong partnerships allow us to access top-quality resources, negotiate favorable rates, and deliver high-quality services to our clients.
+
+ 
+ 
+ 
+ Track Record of Success: We has a proven track record of delivering successful events and campaigns for a diverse range of clients. Our portfolio showcases numerous impactful projects and satisfied clients.
+
+ 
+ 
+ 
+ Global Reach: We have a global network of partners and resources, enabling us to support clients in expanding their reach and achieving international success.
+
+ 
+ 
+
+ 78
+
+ 
+
+ 
+
+ 
+
+Growth strategies
+
+ 
+
+Our principal objective is to
+sustain continuous growth in our business and strengthen our market position with the following strategies:
+
+ 
+
+ 
+ 
+ 
+ Expand Service Offerings: Explore opportunities in emerging digital marketing channels, such as influencer marketing or virtual events, to diversify our offerings and capture new market segments.
+
+ 
+ 
+ 
+ Geographic Expansion: Targeting new regions or countries allows us to tap into new customer bases and leverage our expertise in different markets.
+
+ 
+ 
+ 
+ Strategic Partnerships and Acquisitions: By partnering with companies that offer synergistic services or have access to untapped markets, we can expand our capabilities and market reach. Acquisitions can also provide opportunities to integrate new talent, technologies, or client portfolios into our business.
+
+ 
+ 
+ 
+ Invest in Technology and Innovation: Invest in research and development to enhance our technological capabilities, leverage data analytics and AI-driven solutions, and explore emerging technologies such as virtual reality or augmented reality.
+
+ 
+ 
+ 
+ Enhance Marketing and Branding Efforts: A strong marketing and branding strategy is essential for growth. By effectively communicating our unique value proposition and differentiating ourselves from competitors, we can attract new clients and strengthen existing relationships.
+
+ 
+ 
+ 
+ Continuous Learning and Development: To sustain growth, MediaOn invests
+ in employee training, industry certifications, and staying updated on industry trends allows us to offer the latest solutions and
+ maintain a knowledgeable and skilled team.
+
+ 
+ 
+
+Sales and Marketing
+
+ 
+
+Customers
+
+ 
+
+The following sets forth our list
+of our major and customers with growth potentials as of the prospectus date:
+
+ 
+
+ 
+ 
+ 
+ Yahoo Hong Kong Limited
+
+ 
+ 
+ 
+ Now TV Limited (Subsidiary of PCCW)
+
+ 
+ 
+ 
+ The Hong Kong Jockey Club
+
+ 
+ 
+ 
+ MTR Corporation
+
+ 
+ 
+ 
+ SGS Hong Kong Limited
+
+ 
+ 
+ 
+ Kerry Real Estate Agency Limited
+
+ 
+ 
+ 
+ The Hong Kong University of Science and Technology (HKUST)
+
+ 
+ 
+ 
+ Link Real Estate Investment Trust (Link REIT)
+
+ 
+ 
+ 
+ World Green Organization
+
+ 
+ 
+ 
+ Daekyo Hong Kong Limited (Eyelevel)
+
+ 
+ 
+ 
+ Wacoal Hong Kong Company Limited
+
+ 
+ 
+ 
+ St. James Settlement
+
+ 
+ 
+ 
+ Saint Francis University
+
+ 
+ 
+ 
+ Ming Pao Newpapers Limited
+
+ 
+ 
+
+The
+companies listed under the "Major Clients with Growth Potentials" heading represent a combination of existing and recurring
+clients with whom MediaOn has either current service arrangements or a history of multiple engagements in recent years. These clients
+are considered to have "growth potential" based on the following criteria:
+
+ 
+
+ Their historical and forecasted marketing budget allocations
+
+ 
+
+ Strategic expansions (e.g., regional market entries or product
+launches)
+
+ 
+
+ Volume of service orders over the past two fiscal years
+
+ 
+
+ Ongoing discussion for long-term or expanded service scopes
+
+ 
+
+These
+clients contribute primarily to our marketing campaign revenue stream and, to a lesser extent, to media placements. Some also indirectly
+drive media rebates through aggregated spend levels that contribute toward volume-based thresholds with third-party platforms.
+
+ 
+
+The
+list includes both active clients with ongoing projects and repeat clients with project-based engagement histories, which may not involve
+formal long-term contracts but do reflect a continued business relationship.
+
+ 
+
+Customer Concentration and Revenue
+Dependence
+
+ 
+
+As disclosed
+in our financial statements, two customers accounted for a significant portion of our revenue:
+
+ 
+
+ In fiscal 2023, Customer A and Customer B accounted for 77.63%
+and 6.04% of total revenue, respectively.
+
+ 
+
+ In fiscal 2024, those two customers represented 42.29% and
+20.32% of total revenue, respectively.
+
+ 
+
+Customer A is
+the rebate income from media platform and Customer B is a direct client, as explained below, who acts as intermediaries on behalf of
+multiple end clients. For customer A, the concentration was primarily due to the placement of large number of different scale
+campaigns from different customers to customer A s media platform. For customer B, it was mainly because a lot of large-scale
+campaigns and ad placements were managed through him during the relevant fiscal periods.
+
+ 
+
+ 79
+
+ 
+
+ 
+
+ 
+
+We do
+not have long-term exclusive contracts with either customer, and future engagements are subject to client project pipeline, media budget
+approvals, and competitive procurement processes. Nevertheless, we maintain strong commercial relationships and have successfully renewed
+or extended services with these parties on multiple occasions.
+
+ 
+
+As discussed below, in prior
+fiscal years, a significant portion of our media rebate revenue was derived from advertising campaigns placed through customer A s
+advertising platform. In 2023, as customer A sold its advertising business to a buyer, leading to the end-of-life of the
+customer A s advertising product and a transition to a new set of commercial terms under that buyer. As a result
+of this transition:
+
+ 
+
+ 
+ 
+ 
+ Our
+ previous rebate structure with customer A, which offered favorable and volume-based rebate terms, was discontinued.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Under
+ the new agreement with that buyer, the rebate levels (That is, the rebate percentages offered by that buyer are lower than
+ the historical rebate levels previously offered by customer A.) offered were significantly reduced and are subject to different
+ volume thresholds and payout mechanisms (i.e. different qualifying criteria and spending thresholds under that buyer make it harder
+ to reach higher rebate tiers.)
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ shift also required operational adjustments, including platform migration and advertiser onboarding, which caused short-term disruption
+ in campaign volume during the transition period.
+
+ 
+
+ 
+
+The combined effect of the
+product sunset and the reduced rebate levels under the buyer s agreement contributed to a decrease in media rebate revenue.
+
+ 
+
+Direct Clients vs. Agency Clients
+
+ 
+
+ Direct Clients are end customers who contract directly with
+MediaOn for marketing or event services. We manage all campaign components including strategy, production, and execution.
+
+ 
+
+ Agency Clients are third-party agencies or intermediaries who
+engage MediaOn to fulfill all or part of a campaign on behalf of their own clients. In such cases, MediaOn may or may not interact directly
+with the end brand, and the scope is usually limited to production, content delivery, or media placement.
+
+ 
+
+This distinction is relevant
+to pricing, service scope, and contract structures, and may affect our gross margins depending on the level of services provided and
+whether we serve as principal or agent.
+
+ 
+
+Marketing strategies
+
+ 
+
+MediaOn, as a marketing agency, employs a variety
+of strategies to effectively engage clients and enhance brand visibility. Key approaches include:
+
+ 
+
+ 
+ 
+ 1.
+ Digital Marketing: Utilizing SEO to boost organic traffic, running SEM campaigns on platforms like Google and Yahoo Ads, and creating valuable content through content marketing.
+
+ 
+ 
+ 2.
+ Social Media Marketing: Tailoring strategies for platforms such as Facebook, Instagram, and LinkedIn, and maintaining different marketing content and company updates.
+
+ 
+ 
+ 3.
+ Brand Development: Optimizing the company website and presentation PowerPoint on visual branding, including logo and aesthetic design.
+
+ 
+ 
+ 4.
+ Market Research: Conducting audience and competitor analyses to identify opportunities and understand target demographics.
+
+ 
+ 
+ 5.
+ Performance Analytics: Leveraging analytics tools for campaign tracking and optimization, including A/B testing to refine approaches for ad placement.
+
+ 
+ 
+ 6.
+ Client Relationship Management: Fostering strong client relationships through personalized communication and feedback loops.
+
+ 
+ 
+ 7.
+ Networking Event: Attend different kinds of events including
+ Trade Development Council, associations and organizations to expand the new business client opportunities.
+
+ 
+ 
+
+Intellectual Property
+
+ 
+
+We have registered the trademark of the Company logo
+shown below with the Trade Marks Registry in Hong Kong under Class 35 with Registration Number 306724170. We are in the progress of registering
+the trademark of the Company logo in the United States.
+
+ 
+
+ 80
+
+ 
+
+ 
+
+ 
+
+ 
+
+Our official company website is: https://www.mediaon.digital
+
+ 
+
+Employees
+
+ 
+
+As of September 30, 2025,
+we had 18 full-time employees. The following table illustrates the number of our full-time employees categorized by different
+functions:
+
+ 
+
+ 
+ Function
+ 
+ Number of full-time employees
+
+ 
+ Business Development
+ 
+ 2
+
+ 
+ Marketing Department
+ 
+ 3
+
+ 
+ Production Team
+ 
+ 4
+
+ 
+ Accounting 
+ 
+ 2
+
+ 
+ Human Resources and Administration
+ 
+ 3
+
+ 
+ Management
+ 
+ 3
+
+ 
+ Executives
+ 
+ 1
+
+ 
+ Total
+ 
+ 18
+
+ 
+ 
+
+We enter into employment agreements
+with our full-time employees that contain standard confidentiality and non-compete provisions.
+
+ 
+
+Aside from full-time employees,
+as of September 30, 2025, we had two part-time employees.
+
+ 
+
+We have not experienced any material
+labor disputes in the past, and we consider our relations with our employees to be good. As of the date of this prospectus, none of our
+employees are represented by a labor union.
+
+ 
+
+Partnerships and Track Record
+
+ 
+
+We have cultivated
+long-standing working relationships with over 50 third-party suppliers and creative vendors across content production, event logistics,
+media buying, and technology development. These relationships have enabled us to negotiate preferential terms such as volume discounts,
+priority scheduling, and bundled service rates. While not formalized as strategic alliances, these suppliers have demonstrated consistent
+service reliability over multiple fiscal years.
+
+ 
+
+Since 2011, MediaOn
+has completed over 3,000 marketing campaigns and event projects for clients ranging from listed corporations to SMEs across sectors such
+as finance, retail, F&B, and technology. Many of our client engagements are recurring in nature, and our historical project delivery
+is a key element in winning new business.
+
+ 
+
+In prior fiscal years,
+a significant portion of our media rebate revenue was derived from advertising campaigns placed through Yahoo s native advertising
+platform. In 2023, Yahoo sold its native advertising business to Tabolla, leading to the end-of-life of the Yahoo advertising
+product and a transition to a new set of commercial terms under Tabolla.
+
+ 
+
+As a result of this
+transition:
+
+ 
+
+ Our previous
+ rebate structure with Yahoo, which offered favorable and volume-based rebate terms, was discontinued.
+
+ 
+
+ Under the new
+ Tabolla agreement, the rebate levels offered were significantly reduced and are subject
+ to different volume thresholds and payout mechanisms.
+
+ 
+
+ The shift also
+ required operational adjustments, including platform migration and advertiser onboarding,
+ which caused short-term disruption in campaign volume during the transition period.
+
+ 
+
+The combined effect of
+the product sunset and the reduced rebate levels under the Tabolla agreement contributed to a decrease in media rebate revenue,
+which was a key factor in the year-over-year decline in total revenue. Management is actively expanding relationships with additional
+media platforms and diversifying revenue streams to mitigate future dependency on any single media rebate source.
+
+ 
+
+Use of Artificial Intelligence (AI)
+
+ 
+
+Artificial
+intelligence (AI), in the context of our business, refers to the use of machine-learning-based platforms and tools that assist with content
+generation, automation, and digital interactivity.
+
+ 
+
+ Content
+ Creation: We use third-party AI tools such as ChatGPT and Poe for text generation (e.g.,
+ ad copy, blog articles), and Midjourney and ComfyUI for visual design concepts and drafts.
+
+ 
+
+ Design
+ and Video Automation: We leverage tools like Zapier AI and related workflow automation
+ platforms to streamline repetitive design tasks, accelerate video post-production, and enhance
+ user interactivity.
+
+ 
+
+ AI
+ Interactive Event: This offering refers to hybrid event experiences that integrate generative
+ AI components—for instance, real-time AI-powered content generation for event presentations,
+ customized chatbot engagement for attendees, or interactive booths that use AI to personalize
+ user responses.
+
+ 
+
+MediaOn currently does not
+own or develop proprietary AI technology. All AI functionality is delivered via the integration of licensed or publicly available AI
+platforms, such as those developed by OpenAI and others. These tools are typically accessed via subscription or commercial license.
+
+ 
+
+ 81
+
+ 
+
+ 
+
+ 
+
+Agreements
+
+ 
+
+The Company is a party to
+agreements with certain vendors and joint venture partners. Certain of these agreements are discussed below.
+
+ 
+
+WeShare.hk
+
+ 
+
+WeShare.hk is an influencer
+marketing intelligence platform wholly owned and internally developed by MediaOn. The platform plays a strategic role in our social media
+marketing segment. It serves as a centralized KOL (Key Opinion Leader) content platform that connects brands with a curated network of
+influencers to promote products or services across social media channels. Through WeShare.hk, we facilitate the end-to-end process of
+influencer campaign management, including content planning, campaign execution, and performance analytics. The platform enhances our
+ability to offer KOL Marketing services as part of our marketing campaign and media placement revenue streams and is directly integrated
+into our digital campaign offerings. All content and campaign revenue generated via WeShare.hk are recognized as marketing campaign revenue
+under our financial reporting.
+
+ 
+
+Sodainsight – Social Listening Platform
+
+ 
+
+From 2022 onward, MediaOn
+has operated a proprietary-branded social listening platform called Sodainsight, which provides real-time monitoring and analysis of
+digital content across social media platforms, forums, and news websites. The platform supports our campaign strategy and media planning
+services by offering insights into consumer behavior, sentiment analysis, brand tracking, and public opinion trends.
+
+ 
+
+While the Sodainsight is
+operated and owned by MediaOn which the underlying technology is licensed by an independent third-party supplier. Under the
+terms of our commercial agreement, MediaOn benefits from a bulk purchase with a preferred pricing arrangement with no commitment, allowing
+us to obtain the technology and data services at a discounted rate compared to standard market terms. This favorable arrangement enhances
+our margin profile and scalability in delivering social listening solutions to clients.
+
+ 
+
+Common People & Production Limited
+
+ 
+
+In order to enhance quality
+influence over production, on October 31, 2024, MediaOn established a joint venture with Common People
+& Production Limited, a Hong Kong-based event production company. MediaOn holds a 40% equity interest in the joint venture. The joint
+venture entity provides high-quality event production services—including venue setup, audiovisual design, logistics management,
+and technical execution—to corporate clients in Hong Kong. This joint venture enhances our capabilities in the "Event Management"
+segment by allowing us to offer integrated services, from creative concept to on-site execution.
+
+ 
+
+The joint venture operates
+independently, and MediaOn accounts for its share of results using the equity method of accounting. As of the date of this response,
+there are no material guarantees, obligations, or off-balance sheet commitments associated with this partnership.
+
+ 
+
+Suppliers
+
+ 
+
+Third-party suppliers play
+a supporting role in our delivery of marketing campaign and event services. These suppliers are typically engaged on a project basis
+to fulfill specialized components of our client deliverables, particularly in areas requiring technical expertise or physical production
+capabilities. The primary functions of third-party suppliers include:
+
+ 
+
+ Content
+ production (e.g., animation, video editing, copywriting)
+
+ 
+
+ Event
+ logistics (e.g., AV setup, stage production, venue decoration, manpower)
+
+ 
+
+ Technology
+ services (e.g., development of AR/VR assets, data dashboards, microsites)
+
+ 
+
+ Media
+ placement intermediaries, where we coordinate ad purchases via agency resellers or partners
+
+ 
+
+While MediaOn retains responsibility
+for project strategy, design, client communication, and quality control, the use of third-party resources allows us to scale operations
+flexibly without significant fixed overhead. Our internal team manages supplier selection, contract terms, and deliverables to ensure
+compliance with client expectations.
+
+ 
+
+The increase of 133.95% in
+cost of revenues for marketing campaigns in fiscal 2024, as disclosed in our MD&A, was primarily driven by an expansion in the volume
+and scope of client projects, which required greater reliance on outsourced production, event logistics, and technical development services.
+This reflects our growth strategy to broaden service offerings and support larger-scale campaigns.
+
+ 
+
+ 82
+
+ 
+
+ 
+
+ 
+
+The
+following table sets forth information as to each supplier that accounted for 10% or more of the Company s purchase for the six months ended March
+31, 2025 and 2024.
+
+ 
+
+ 
+ 
+ For the six months ended 
+
+ 
+ Suppliers 
+ March 31, 2025 
+ March 31, 2024 
+
+ 
+ 
+ Amount 
+ % to Cost of Revenue 
+ Amount 
+ % to Cost of Revenue 
+
+ 
+ Supplier A 
+ $62,359 
+ 19.12 
+ $12,009 
+ 3.04 
+
+ 
+ Supplier B 
+ 40,510 
+ 12.4 
+ - 
+ - 
+
+ 
+ Supplier C 
+ 7,015 
+ 2.15 
+ 45,060 
+ 11.42 
+
+ 
+ Supplier D 
+ 1,340 
+ 0.41 
+ 137,481 
+ 34.85 
+
+ 
+ Total: 
+ $111,224 
+ 34.10 
+ $194,550 
+ 49.31 
+
+ 
+
+ 
+
+During
+the six months ended as of March 31, 2025 and 2024 we were reliant on our top 4 suppliers. However, the Company does not believe it has
+high dependency on any single third-party supplier and that it could source additional suppliers if required.
+
+ 
+
+The
+following table sets forth information as to each supplier that accounted for 10% or more of the Company s purchase for the years ended September
+30, 2024 and 2023.
+
+ 
+
+ 
+ 
+ For the years ended 
+
+ 
+ Suppliers 
+ September 30, 2024 
+ September 30, 2023 
+
+ 
+ 
+ Amount 
+ % to Cost of Revenue 
+ Amount 
+ % to Cost of Revenue 
+
+ 
+ Supplier A 
+ $233,029 
+ 19.91 
+ $- 
+ - 
+
+ 
+ Supplier B 
+ 227,423 
+ 19.43 
+ 10,343 
+ 0.62 
+
+ 
+ Supplier C 
+ 130,331 
+ 11.14 
+ 306,870 
+ 18.47 
+
+ 
+ Supplier D 
+ 24,361 
+ 2.08 
+ 266,989 
+ 16.07 
+
+ 
+ Supplier E 
+ - 
+ - 
+ 220,516 
+ 13.27 
+
+ 
+ Supplier F 
+ 4,673 
+ 0.40 
+ 175,159 
+ 10.54 
+
+ 
+ Total: 
+ $619,817 
+ 52.96 
+ $979,877 
+ 58.97 
+
+ 
+
+ 
+
+During
+the fiscal years ended as of September 30, 2024 and 2023 we were reliant on our top 5 suppliers. However, the Company does not believe
+it has high dependency on any single third-party supplier and that it could source additional suppliers if required.
+
+ 
+
+Our Awards and Recognition
+
+ 
+
+Since 2014 we have received the
+following awards and recognition.
+
+ 
+
+ 
+ Organization
+ 
+ Awards
+ 
+ Years
+
+ 
+ Hong Kong Internet Registration Corporation Limited
+ 
+ Best HK Website Awards 2014 - Bronze Prize
+ 
+ 2014
+
+ 
+ The Hong Kong Federation of Youth Groups (HKFYG)
+ 
+ HSBC Youth Business Award 2014 
+ 
+ 2014
+
+ 
+ Yahoo!
+ 
+ Best Native Ad Campaign (SME) 2016 Merit
+ 
+ 2016
+
+ 
+ Yahoo!
+ 
+ Yahoo Big Idea Chair Awards 2017 Best Native Ad Campaign (For SME) Outstanding
+ 
+ 2017
+
+ 
+ Yahoo!
+ 
+ Asia Big Idea Chair Awards 2019 Best Use of Native Ad Formats Merit Yahoo – Re-Targeting GIF
+ 
+ 2019
+
+ 
+ Yahoo!
+ 
+ Yahoo Asia Big Idea Chair Awards 2021 [Asia] Best Use of Emerging Format in Programmatic Merit Programmatic DOOH campaign at Hong Kong International Airport
+ 
+ 2021
+
+ 
+ Yahoo!
+ 
+ Yahoo Asia Big Idea Chair Awards 2021 Best Use of Emerging Format in Programmatic Merit Programmatic DOOH campaign at Hong Kong International Airport
+ 
+ 2021
+
+ 
+ The Hong Kong Council of Social Service (HKCSS) 
+ 
+ Caring Company 10+
+ 
+ 2024
+
+ 
+ 
+
+Competition
+
+ 
+
+Having described that barriers of entry of our industry
+are relatively low. We are facing competitions from a numerous of small players in the industry which may be as small as a sole propriety
+or multination companies. According to research being conducted by the Hong Kong Trade Development Council in May 2023, there are more
+than 3,700 marketing service establishments, both online and offline in Hong Kong.
+
+ 
+
+We believe our competitors with similar business in
+Hong Kong region shall be Guru Online and iClick. Guru Online is a public company in Hong Kong and iClick is a Nasdaq traded company.
+
+ 
+
+Insurance
+
+ 
+
+We maintain insurance policies
+material to our operations against all property risks, business interruption, public liability and employees compensation.
+
+ 
+
+We are of the view that coverage
+of insurance policies taken out by us is adequate for our operation in all material aspects and is in line with the standard industry
+practice in Hong Kong. As at the date of this prospectus, we had not made, or been the subject of, any material insurance claim.
+
+ 
+
+Litigation
+
+ 
+
+From time to time, we may be involved
+in legal proceedings or may be subject to claims arising in the ordinary course of our business. As of September 30, 2024, we were not
+party to any ongoing legal proceedings that in the opinion of our management would have a material adverse effect on our business.
+
+ 
+
+ 83
+
+ 
+
+ 
+
+ 
+
+REGULATORY ENVIRONMENT
+
+ 
+
+This section sets forth a summary
+of certain aspects of major laws and regulations which are relevant to our business operations in Hong Kong. The information provided
+in this section is for your general information only and should not be construed as a comprehensive summary or detailed analysis of the
+laws and regulations that are applicable to our business operations. You should consult your own advisers regarding the implication of
+such laws and regulations of Hong Kong on our business operations.
+
+ 
+
+Laws And Regulations on Our Business Operations
+in Hong Kong
+
+ 
+
+The Basic Law is the constitutional
+document of Hong Kong, which sets out the PRC s basic policies regarding Hong Kong. The principle of "one country, two systems"
+is a prominent feature of the Basic Law, which dictates that Hong Kong will retain its unique common law and capitalist system for 50
+years after the handover in 1997. According to Article 18 of the Basic Law, national laws adopted by the PRC shall not be applied in Hong
+Kong, except for those listed in Annex III to the Basic Law, such as the laws in relation to the national flag, national anthem, and diplomatic
+privileges and immunities.
+
+ 
+
+There are no overarching and specific
+laws governing our digital advertising agency and social media marketing services business in Hong Kong. The ordinances and regulations
+that may be applicable in relation to our business include, Copyright Ordinance (Chapter 528 of the Laws of Hong Kong), Trade Marks Ordinance
+(Chapter 559 of the Laws of Hong Kong), Control of Obscene and Indecent Articles Ordinance (Chapter 390 of the Laws of Hong Kong), Defamation
+Ordinance (Chapter 21 of the Laws of Hong Kong), Mandatory Provident Fund Schemes Ordinance (Chapter 485 of the Laws of Hong Kong), Employment
+Ordinance (Chapter 57 of the Laws of Hong Kong), Minimum Wage Ordinance (Chapter 608 of the Laws of Hong Kong), Employees Compensation
+Ordinance (Chapter 282 of the Laws of Hong Kong), Occupational Safety and Health Ordinance (Chapter 509 of the Laws of Hong Kong), Inland
+Revenue Ordinance (Chapter 112 of the Laws of Hong Kong), Business Registration Ordinance (Chapter 310 of the Laws of Hong Kong), Trade
+Descriptions Ordinance (Chapter 362 of the Laws of Hong Kong), Electronic Transaction Ordinance (Chapter 553 of the Laws of Hong Kong),
+Personal Data (Privacy) Ordinance (Chapter 486 of the Laws of Hong Kong) and Competition Ordinance (Chapter 619 of the Laws of Hong Kong).
+These ordinances and regulations are discussed in detail below.
+
+ 
+
+The Copyright Ordinance
+
+ 
+
+The Copyright Ordinance provides
+comprehensive protection for certain categories of work such as original literary, dramatic, musical and artistic works. Such protection
+extends to making available to the public such works on the Internet. Certain copyrights may subsist in the works we create in relation
+to our publications and advertising contents and materials, including creator s works (such as artworks and photos), films (such
+as videos) or literary works (such as text) that qualify for copyright protection without registration. The Copyright Ordinance
+restricts certain acts such as copying and/or issuing or making available copies to the public of a copyrighted work without the authorization
+from the copyright owner which, if done, constitutes "primary infringement" of copyright which does not require the infringer s
+knowledge of infringement. It is a defence to copyright infringement if the person copies an artistic work for the purpose of advertising
+the sale of the work. Also, the Copyright Ordinance permits certain acts that can be done in relation to copyrighted works without authorization
+from the copyright owner, one of which being fair dealing with a copyrighted work for the purpose of criticism, review or reporting current
+events if accompanied by a sufficient acknowledgement of such copyrighted work and its author ("Fair Dealing Defence"). Product
+shots taken by us for advertisements, which may have copied certain artistic works existing on the products, do not constitute copyright
+infringement as their use is either authorized by the copyright owners or we could rely on the Fair Dealing Defence.
+
+ 
+
+A person who possesses, sells
+or offers for sale or hire, for the purposes of or in the course of any trade or business without the consent of the copyright owner,
+a copy of a work which is, and which he knows or has reason to believe to be, an infringing copy of the work may incur criminal liability
+for "secondary infringement" under the Copyright Ordinance. For the sale of an infringing copy in the course of any trade
+or business, upon conviction on indictment, the infringer is liable to a fine at HK$50,000 in respect of each infringing copy and to imprisonment
+for four years. However, the person will only be liable if, at the time he committed the act, he knew or had reason to believe that he
+was dealing with infringing copies of the work. In proving that he has reason to believe that the copy was not an infringing copy, the
+defendant has to show that (a) he had made reasonable enquiries sufficient to satisfy himself that the copy of the work imported or proposed
+to be imported into Hong Kong was not an infringing copy of the work; (b) he had reasonable grounds to be satisfied in the circumstances
+of the case that the copy was not an infringing copy; and (c) there were no other circumstances which would have led him reasonably to
+suspect that the copy was an infringing copy.
+
+ 
+
+ 84
+
+ 
+
+ 
+
+ 
+
+Trademarks Ordinance
+
+ 
+
+The Trademarks Ordinance protects
+registered trademarks. The duration of the registered trademarks is for ten years, which can be further renewed for ten years per renewal.
+A registered trademark may be challenged in revocation proceedings if it is not used in Hong Kong for a continuous period of three years.
+A person infringes a registered trademark if he uses in the course of trade or business a sign:
+
+ 
+
+ 
+ (1)
+ which is identical to the trademark in relation to goods or services which are identical to those for which it is registered;
+
+ 
+ (2)
+ which is identical to the trademark in relation to goods or services which are similar to those for which it is registered, and the use of the sign in relation to those goods or services is likely to cause confusion on the part of the public;
+
+ 
+ (3)
+ which is similar to the trademark in relation to goods or services which are identical or similar to those for which it is registered and the use of the sign in relation to those goods or services is likely to cause confusion on the part of the public; or
+
+ 
+ (4)
+ which is identical or similar to the well-known trademark in relation to any goods or services, and the use of the sign, being without due cause, takes unfair advantage of, or is detrimental to, the distinctive character or repute of the trademark.
+
+ 
+ 
+
+The Trademarks Ordinance also
+provides an exemption from an infringement of registered trademark if the registered trademark is used for the purpose of identifying
+goods or services as those of the owner of the registered trademark, but any such use which is otherwise than in accordance with honest
+practices in industrial or commercial matters shall be treated as infringement of the registered trademark. In considering whether the
+use is in accordance with honest practices in industrial or commercial matters, the relevant factors include whether: (a) the use takes
+unfair advantage of the trademark; (b) the use is detrimental to the distinctive character or repute of the trademark; and (c) the use
+is such to deceive the public. It was identified in case law that the manners by which a person may take unfair advantage of the trademark
+or cause detriment to the distinctive character or repute can take the following forms:
+
+ 
+
+ 
+ (1)
+ detriment to the distinctive character is caused when that mark s ability to identify the goods or services for which it is registered is weakened;
+
+ 
+ (2)
+ detriment to the repute of the mark caused when the goods or services for which the identical or similar sign is used by the third party may be perceived by the public in such a way that the trademark s power of attraction is reduced; and
+
+ 
+ (3)
+ the unfair advantage refers to the advantage taken by the third party as a result of the use of the identical or similar sign, such as an exploitation on the coattails of the mark with a reputation.
+
+ 
+ 
+
+Control of Obscene and Indecent Articles Ordinance
+
+ 
+
+COIAO controls articles which
+consist of or contain material that is obscene or indecent (including material that is violent, depraved or repulsive). Several offenses
+are prescribed: (1) publishing, possessing for publication or importing for publication obscene articles; (2) publishing indecent article
+to juvenile; (3) making display, and causing or permitting display of indecent matter in public; (4) publishing indecent article without
+complying with the statutory conditions; (5) possessing for publication indecent article in breach of the statutory conditions; (6) publishing
+Class III (interim classification) article; (7) publishing, possessing for publication or importing for publication any Class III article;
+(7) publishing Class II article without complying with the imposed conditions; and (8) possessing for publication indecent article without
+complying with the statutory conditions or imposed conditions.
+
+ 
+
+ 85
+
+ 
+
+ 
+
+ 
+
+Defamation Ordinance
+
+ 
+
+Any person who maliciously publishes
+defamatory matter regarding another person or an organization in writing or by word of mouth or by conduct may be liable for defamation.
+Broadly speaking, there are two main kinds of defamation, which are libel and slander. Libel is the malicious publication of defamatory
+matter in writing or in some other permanent form. Slander is the publication of defamatory matter by word of mouth or in some other
+transient (temporary) form. Section 5 of the Defamation Ordinance provides that any person who maliciously publishes any defamatory libel,
+knowing the same to be false, shall be liable to imprisonment for two years, and, in addition, to pay such fine as the court may award.
+There are several defenses available. They include but are not limited to (a) unintentional defamation; (b) an offer of amends;
+(c) defences of justification, which means the words were true in substance and in fact; (d) fair comment; and (e) publication which
+was privileged as prescribed in the schedule of the Defamation Ordinance.
+
+ 
+
+Mandatory Provident Fund Schemes Ordinance
+
+ 
+
+Section 7 of the MPFSO requires
+every employer to enroll an eligible employee aged between 18 and 65 (unless exempted) to become a member of a registered scheme within
+60 days from the day on which employment commences. Section 7A of the MPFSO further requires both the employer and employee to contribute
+5% of the employee s relevant monthly income to the Mandatory Provident Fund Schemes each month with a maximum contribution cap
+of HK$30,000 per month. Schedule 3 of the MPFSO provides that the maximum level of relevant income for contribution purposes is HK$30,000
+per month. Under section 43B of the MPFSO, an employer, without reasonable excuse, fails to comply with a requirement imposed on employers
+by section 7 commits an offence and is liable on conviction to a fine of HK$350,000 and to imprisonment for three years.
+
+ 
+
+Any employer who fails to enroll
+employees in a MPF scheme commits a criminal offence and is liable to a maximum fine of HK$350,000 and imprisonment for three years.
+Any employer who fails to pay mandatory contributions to trustees commits a criminal offence and is liable to a maximum fine of HK450,000
+and imprisonment for four years. Our directors confirm that we have complied with the MPFSO.
+
+ 
+
+Employment Ordinance
+
+ 
+
+The EO is the main piece of legislation
+governing, amongst other things, the protection of employees wages and general conditions of employment and employment agencies.
+
+ 
+
+Section 23 of the EO requires
+an employer to pay wages to an employee under a contract of employment as soon as is practicable but in any case not later than seven
+days after the last day of the wage period. Section 25 of the EO provides that where a contract of employment is terminated, any sum due
+to the employee shall be paid to him as soon as is practicable and in any case not later than seven days after the day of termination.
+Section 63C of the EO provides that any employer who willfully and without reasonable excuse contravenes section 25 of the EO, commits
+an offence and is liable to a fine of HK$350,000 and to imprisonment for three years.
+
+ 
+
+Section 25A of the EO also provides
+that if any wages or any sum are not paid within seven days from the day on which they become due, the employer shall pay interest at
+a specified rate (currently at 8% per annum) on the outstanding amount of wages or sum from the date on which such wages or sum become
+due up to the date of actual payment. Section 63CA of the EO provides that any employer who willfully and without reasonable excuse contravenes
+section 25A of the EO commits an offence and is liable on conviction to a fine of HK$10,000. Our directors confirm that we have complied
+with the EO.
+
+ 
+
+Minimum Wage Ordinance
+
+ 
+
+The MWO provides for a statutory
+minimum wage at an hourly rate applicable to all employees employed under the EO, whether they are monthly-rated, daily-rated, hourly-rated,
+permanent, casual, full-time, or part-time employees. The statutory minimum wage ("SMW") is currently HK$40 per hour with
+effect from 1 May 2023. Any provision of the employment contract which purports to extinguish or reduce the right, benefit or protection
+conferred on the employees by the MWO is void. If an employer willfully and without any reasonable excuse fails to pay the SMW
+rate when it becomes due may be liable to a fine of HK$350,000 and to imprisonment for three years. Our directors confirm that we have
+complied with the MWO.
+
+ 
+
+ 86
+
+ 
+
+ 
+
+ 
+
+Employees Compensation Ordinance
+
+ 
+
+The ECO sets out the rights and
+obligations of employers and employees in respect of injuries or death caused by accidents arising out of and in the course of employment,
+or by prescribed occupational diseases under the ECO. The ECO also prohibits an employer from employing any employee in any employment
+unless there is a policy of insurance in force to cover the employer s liabilities under the Employees Compensation Ordinance
+and at common law for injuries at work. The minimum insurance cover for not more than 200 employees should not be less than HK$100 million
+per event whereas the minimum cover for more than 200 employees should not be less than HK$200 million per event. Any employer who fails
+to comply commits an offense and is liable on conviction upon indictment to a fine of HK$100,000 and to imprisonment for two years and
+on summary conviction to a fine of HK$100,000 and imprisonment for one year. An employer to whom a policy of insurance for the purpose
+thereof is required to display in a conspicuous place on each of his premises (where any employee is employed by him) a notice in a form
+specified by the Commissioner for Labor, which shows in both English and Chinese languages of (a) the name of the employer, (b) the name
+of the insurer, (c) the policy number, (d) the date of issue of the policy, (e) the dates of commencement and expiry of the period of
+insurance, (f) the number of employees insured under the policy at the time of issue thereof and (g) the amount of liability insured under
+the policy. Our directors confirm that we have complied with the ECO.
+
+ 
+
+Occupational Safety and Health Ordinance
+
+ 
+
+The OSHO ensures the safety and
+health of persons when they are at work. Section 6 of the OSHO requires every employer to, so far as reasonably practicable, ensure the
+safety and health of employees at work by (1) providing and maintaining plant and work systems that are safe and without risks to health;
+(2) making arrangements for ensuring safety and absence of risks to health in connection with the use, handling, storage or transport
+of plants or substances; (3) providing all necessary information, instruction, training and supervision for ensuring safety and health;
+providing and maintaining safe access to and egress from the workplaces; and providing and maintaining a safe and healthy work environment.
+
+ 
+
+Under sections 6(3) and (4) of
+the OSHO, an employer who fails to comply with the above provisions commits an offence and is liable on summary conviction to a fine of
+HK$3,000,000 or on conviction on indictment to a fine of HK$10,000,000; and an employer who fails to do so intentionally, knowingly or
+recklessly commits an offence and is liable on summary conviction to a fine of HK$3,000,000 and to imprisonment for six months or on conviction
+on indictment to a fine of HK$10,000,000 and to imprisonment for two years.
+
+ 
+
+In terms of enforcement, the Commission
+for Labor may serve improvement notice and suspension notice on the employer or occupier of premises where a workplace is located and
+failure to comply without reasonable excuse may be liable to a fine of HK$200,000 in respect of an improvement notice and a fine of HK$500,000
+in respect of a suspension notice and to imprisonment for twelve months in each of such conviction. The employer or the occupier of a
+workplace is required to notify any accident to an occupational safety officer within 24 hours if an accident causes the death of, or
+serious bodily injury to an employee. The employer or the occupier of a workplace is required to report in writing any accident to an
+occupational safety officer within seven days if the accident incapacitated an employee (other than causing death or serious bodily injury).
+The occupier of a workplace is also required to notify any dangerous occurrence to an occupational safety officer within 24 hours and
+failure to notify in any such instances may be liable to a fine of HK$50,000. Our directors confirm that we have put in place measures
+to ensure compliance with the OSHO, including: (a) providing safe and healthy work environment for staffs, including but not limited to,
+adequate lighting level; (b) providing safety instructions and training to workers; and (c) establishing internal safety and health policies
+and procedures.
+
+ 
+
+Inland Revenue Ordinance
+
+ 
+
+The IRO requires an employer to
+furnish to the Inland Revenue Department of Hong Kong in writing, (1) within three months of engagement, particulars of any new employee
+(i.e. Form 56E) who is likely to be chargeable to salaries tax, (2) within one month a return (Form 56B and BIR56A) with details of the
+remuneration paid to an employee during the year in question; and (3) at least one month before his employee ceases to be employed, particulars
+of any employee who is about to cease or ceases to employ in Hong Kong (i.e. Form 56F). Any employer who failed to do so, unless with
+reasonable excuse, commits an offence and is liable to a maximum fine of HK$10,000 and the court may order the person convicted to do
+within a specified time the act which he has failed to do. The IRO requires any person on which profits tax is chargeable on his assessable
+profits to file tax return, provide supplemental documents if necessary, and pay the assessed profits tax accordingly. Our directors confirm
+that we have complied with the IRO.
+
+ 
+
+Business Registration Ordinance
+
+ 
+
+Section 5 of the BRO requires
+every person (a company or an individual) carrying on a business in Hong Kong to make an application to the Commissioner of Inland Revenue
+for the registration of that business to obtain a business registration certificate within one month of the commencement of business.
+Under section 12 of the BRO, a valid business registration certificate or branch registration certificate is required to be displayed
+at the place of business to which the certificate relates.
+
+ 
+
+ 87
+
+ 
+
+ 
+
+ 
+
+Under section 15 of the BRO, any
+person who fails to make any application as required under section 5 or fails to display a valid business registration certificate or
+a valid branch registration certificate as required under section 12 shall be liable to a fine of HK$5,000 and to imprisonment for one
+year.
+
+ 
+
+Competition Ordinance
+
+ 
+
+The Competition Ordinance was
+enacted, amongst other things, to prohibit conduct that prevents, restricts or distorts competition in Hong Kong through three competition
+rules: The First Conduct Rule which prohibits anti-competitive agreements; the Second Conduct Rule which prohibits abuse of market power;
+and the Merger Rule which prohibits anti-competitive mergers and acquisitions. Only the First and Second Conduct Rules apply to us as
+the Merger Rule only applies to merger in relation to Telecommunication Ordinance.
+
+ 
+
+The First Conduct Rule prohibits
+business from making or giving effect to an agreement, engaging in a concerted practice, or telecommunications carrier licensees making
+or giving effect to a decision of an association, if the object or effect is to prevent, restrict or distort competition in Hong Kong.
+Conduct in breach of the First Conduct Rule includes price fixing, market-sharing, bid-rigging and output restriction and resale price
+maintenance. If the Competition Commission has reasonable cause to believe that there has been a contravention of this Rule and does not
+involve serious anti-competitive conduct, the Competition Commission must issue a warning notice before commencing proceedings in the
+Tribunal.
+
+ 
+
+The Second Conduct Rule prohibits
+business with a substantial degree of market power from abusing that power by engaging in conduct that has the object or effect of harming
+competition in Hong Kong. In considering whether the degree of market power is "substantial", the relevant matters are: (a)
+the market share of the undertaking; (b) the undertaking s power to make pricing and other decisions; (c) any barriers to entry
+to competitors into the relevant market; and (d) any other relevant matters. Conduct that may constitute an abuse if it involves (a) predatory
+behavior towards competitors or (b) limiting production, markets or technical developments to the prejudice of consumers, including below-cost
+pricing, tying and bundling, margin squeezing, refusals to deal and exclusive dealing.
+
+ 
+
+If the Competition Commission
+has reasonable cause to believe that there has been a contravention of the First Conduct Rule involving serious anti-competitive conduct
+and/or the Second Rule, the Competition Commission must issue an infringement notice offering not to bring proceedings on condition that
+the offender makes a commitment to comply with the requirements of the infringement notice within a prescribed period.
+
+ 
+
+If a company and/or its directors
+are found to be involved in breaching the Competition Ordinance, the potential penalties are: (a) pecuniary penalties up to 10% of annual
+local turnover, (b) director s disqualification orders for up to five years, (c) divestiture of assets, shares, or business, (d)
+voiding of agreement, and (e) injunction relief.
+
+ 
+
+Trade Descriptions Ordinance
+
+ 
+
+The TDO was enacted to, amongst
+other things, prohibit false trade descriptions; false, misleading or incomplete information; false marks and misstatements in respect
+of goods provided (both online and offline) in the course of trade or suppliers of such goods. "Trade description" is defined
+to mean in relation to goods, an indication, direct or indirect, and by whatever means given, with respect to the goods or any part of
+the goods including an indication of any of the following matters: the quantity, size, gauge; the method of manufacture, production, processing
+or reconditioning; the composition; the fitness for purpose, strength, performance, behavior or accuracy; the availability; the compliance
+with a standard specified or recognized by any person; the price, how price is calculated or the existence of any price advantage or discount,
+etc.. "False trade description" is defined to mean a trade description which is (a) false to a material degree or (b) a trade
+description, which though not false, is misleading: that is to say, likely to be taken for a trade description of a kind that would be
+false to a material degree.
+
+ 
+
+ 88
+
+ 
+
+ 
+
+ 
+
+The TDO prohibits any person from
+(1) in the course of his trade or business supplying or offering to supply any goods to which a false trade description is applied, or
+(2) having in his possession for sale any goods to which a false trade description is applied, or (3) import or export any goods to which
+a false trade description is applied. Any person who does any of the above prohibited acts commits an offense and is liable on conviction
+on indictment to a fine of HK$500,000 and to imprisonment for five years, and on summary conviction to a fine at HK$100,000 and to imprisonment
+for two years. It is a defence to the above offenses if the person did not know, had no reason to suspect, and could not with reasonable
+diligence have ascertained the false trade description had been applied to the goods. The Trade Descriptions Ordinance also prohibits
+unfair trade practices that involve: (1) misleading omission, (2) aggressive commercial practice, (3) bait advertising, (4) bait and switch,
+and (5) wrongly accepting payment.
+
+ 
+
+Electronic Transaction Ordinance
+
+ 
+
+The ETO was enacted, among others,
+to facilitate the use of electronic transactions for commercial and other purposes. The Electronic Transaction Ordinance recognizes electronic
+records and signatures, giving them the same legal status as their paper counterparts except for limited matters (which do not relate
+to transactions executed in our course of business) where the ETO do not apply due to rules of law relating to such limited matters.
+
+ 
+
+Personal Data (Privacy) Ordinance
+
+ 
+
+The PDPO provides that a data
+user (a person who controls the collection, holding, processing or use of personal data) shall not do any act, or engage in a practice,
+that contravenes any of the principles set out in Schedule 1 to the PDPO (the "Data Protection Principles") unless
+the act or practice, as the case may be, is required or permitted under the PDPO. Personal data refers to any data (a) relating directly
+or indirectly to a living individual; (b) from which it is practicable for the identity of the individual to be directly or indirectly
+ascertained; and (c) in a form in which access to or processing of the data is practicable. The Data Protection Principles are summarized
+as follows:
+
+ 
+
+ 
+ (1)
+ Personal data should be collected in a lawful and fair way, for a lawful purpose directly related to a function or activity of the data user. Data collected should be necessary but not excessive. All practicable steps shall be taken to notify the person whose data is being collected is informed (a) whether it is obligatory or voluntary for him to supply the data; (b) the purpose of the collection and the class of persons to whom the data may be transferred; (c) on or before first use of the data, his rights to access and correct the data collected and the information of the person who might handle such requests.
+
+ 
+ 
+ 
+
+ 
+ (2)
+ All practicable steps shall be taken by the data user to ensure that the personal data collected is accurate and not kept longer than is necessary to fulfil the purpose for which it is used.
+
+ 
+ 
+ 
+
+ 
+ (3)
+ Personal data should not be used for purposes outside of the person s explicit consent.
+
+ 
+ 
+ 
+
+ 
+ (4)
+ All practicable steps shall be taken to safeguard personal data held by a data user against unauthorized or accidental access, processing, erasure, loss or use.
+
+ 
+ 
+ 
+
+ 
+ (5)
+ All practicable steps shall be taken to ensure that a person can (a) ascertain a data user s policies and practices in relation to personal data; (b) be informed of the kind of personal data held by a data user; (c) be informed of the main purposes for which personal data held by a data user is or is to be used.
+
+ 
+ 
+ 
+
+ 
+ (6)
+ The person whose data is being collected shall be given access to his personal data and to make corrections where the data is inaccurate. 
+
+ 
+ 
+
+Contravention of the PDPO may
+result in the Office of the Privacy Commissioner for Personal Data issuing an enforcement notice to the data user directing remedial and/or
+preventive steps to be taken. Unless the data user charged could show that he had already exercised all due diligence to comply with such
+enforcement notice, contravention of such notice is an offence which may result in first conviction to a maximum fine of HK$50,000 and
+imprisonment for two years, with a daily penalty of HK$1,000. Subsequent conviction may result in a maximum fine of HK$100,000 and imprisonment
+for two years, with a daily penalty of HK$2,000. Our directors confirm that we have complied with the PDPO. Certain user data and information
+may be collected during the course of our business operations. Accordingly, data protection measures are put in place to ensure the data
+and information that the Company collects are not misappropriated or misused.
+
+ 
+
+ 89
+
+ 
+
+ 
+
+ 
+
+MANAGEMENT
+
+ 
+
+Directors, Director Nominees, and Executive Officers
+
+ 
+
+The following table sets forth
+the names, ages and positions of our board of directors, director nominees, and executive officers and a description of the business experience
+of each of them:
+
+ 
+
+ 
+ Name
+ 
+ Age
+ 
+ Position
+
+ 
+ Jerry Chi Wai Chan
+ 
+ 50
+ 
+ Chairman, Executive Director and Chief Executive Officer
+
+ 
+ Jimmy Shui Wai Chan
+ 
+ 48
+ 
+ Executive Director and Chief Financial Officer
+
+ 
+ Rico Kai To Chan
+ 
+ 61
+ 
+ Executive Director
+
+ 
+ Francis Po Kiu Fong
+ 
+ 57
+ 
+ Independent director nominee(1)
+
+ 
+ Willde Nang Fong Ng
+ 
+ 73
+ 
+ Independent director nominee(1)
+
+ 
+ Annet Yan Yee Kung
+ 
+ 44
+ 
+ Independent director nominee(1)
+
+ 
+ Hoi Fat Tse
+ 
+ 42
+ 
+ Independent director nominee(1)
+
+ 
+ 
+
+ 
+ 
+ (1)
+ Each of the to-be-named independent director nominees will be appointed upon the effectiveness of the registration statement of which this prospectus forms a part.
+
+ 
+ 
+
+No arrangement or understanding
+exists between any such Director or Executive Officer and any other persons pursuant to which any Director or Executive Officer was elected
+as a Director or Executive Officer. Our Directors are elected annually and serve until their successors take office or until their death,
+resignation or removal. The Executive Officers serve at the pleasure of our Board.
+
+ 
+
+Board of Directors and Executive Officers
+
+ 
+
+Jerry Chi Wai Chan (Mr.
+Jerry Chan") is the Chairman, Executive Director and has served as the Chief Executive Officer of the Company since 2011.
+
+ 
+
+Mr. Jerry Chan has a Bachelor s
+Degree in Information Technology from City University of Hong Kong and a Master s Degree in Business Systems from Monash University.
+As Chief Executive Officer of MediaOn, Mr. Chan has led the company with a strong vision for innovation and digital transformation. He
+has spearheaded its growth into a leading, award-winning digital marketing agency, delivering integrated creative solutions across multiple
+media platforms. His leadership continues to drive the company s strategic direction and operational excellence.
+
+ 
+
+Jimmy Shui Wai Chan ("Mr.
+Jimmy Chan") is an Executive Director and Chief Financial Officer of the Company. Since 2002, Mr. Jimmy Chan has served
+as an Executive Director and Chief Financial Officer of the Company, the chief executive officer of Vizz Technology Limited and a director
+of Madcradle Online Limited. Mr. Jimmy Chan has a Bachelor s Degree in Physics from The Chinese University of Hong Kong and a Master s
+Degree in Internet Computer & eCommerce from the University of Hong Kong.
+
+ 
+
+Rico Kai To Chan ("Mr.
+Rico Chan") is an Executive Director of the Company. Since November 2022, Mr. Rico Chan has served on the Board of Governors
+of World Green Organization, an organization that champions programmes for ESG and Climate Actions including ESG Conference in partnership
+with United Nations ESCAP, Green Office Program, Carbon Neutrality Advisory Services. Between April 2021 and February 2022 Mr. Rico Chan
+served as the Vice President and Head of APAC Sales for Yahoo Limited. Between October 2018 and March 2021, Mr. Rico Chan served as the
+Co-head of APAC for Yahoo Limited. Mr. Rico Chan has a Bachelor of Business Administration from The Chinese University of Hong Kong.
+
+ 
+
+Non-Employee Director Nominees
+
+ 
+
+Francis Po Kiu Fong ("Mr.
+Fong") will begin serving as an independent Director immediately upon the listing of our Company on the Nasdaq Capital Market.
+Mr. Fong will serve as the chairman of the nomination committee and as a member of the audit committee.
+
+ 
+
+ 90
+
+ 
+
+ 
+
+ 
+
+Mr. Fong obtained a Bachelor s
+Degree in Company Secretaryship and Administration from Hong Kong Polytechnic University. Since 1994 Mr. Fong has served as the Co-Chief
+Executive Officer and is a director of SIS Mobile Holdings Limited, an IT and communications product distributor.
+
+ 
+
+Willde Nang Fong Ng ("Mr.
+Ng") will begin serving as an independent Director immediately upon the listing of our Company on the Nasdaq Capital Market.
+Mr. Ng will serve as a member of the nomination committee and the compensation committee.
+
+ 
+
+Mr. Ng obtained a [bachelor] of
+degree in Graphic Design and Advertising from Humber College in Toronto, Canada. Since 2020, Mr. Ng has served as the creative director
+for Promotional Partners Worldwide, a creative content developer. Between 2014 and 2020, Mr. Ng was a founder and head of planning for
+Thinking Without Thinking Limited, a marketing and strategy consulting firm.
+
+ 
+
+Annet Yan Yee Kung ("Ms.
+Kung") will begin serving as an independent Director immediately upon the listing of our Company on the Nasdaq Capital Market.
+Ms. Kung will serve as the chairwoman of the audit committee and as a member of the nomination committee and the compensation committee.
+
+ 
+
+Ms. Kung obtained a bachelor s
+degree in commerce of accountancy from the University of Melbourne in 2004 and a Masters of Corporate Governance from The Hong Kong Polytechnic
+University in 2016. Since November 2021, Ms. Kung has served as an owner of and a director of Anphil Company Limited, a secretarial and
+accounting services company. Since March 2020, Ms. Kung has served as an owner of Annet O.Y. Kung, CPA, an auditing services firm. Ms.
+Kung also serves as a director of Hong Kong Self Rescue Limited and Huiyuan Revitalise Holding.
+
+ 
+
+Hoi Fat Tse ("Mr.
+Tse") will begin serving as an independent Director immediately upon the listing of our Company on the Nasdaq Capital Market.
+Mr. Tse will serve as the chairman of the compensation committee and member of the audit committee. Since 2012, Mr. Tse has served as
+the founding partner of Sinno CPA International Limited, an accounting firm. Mr. Tse has a Bachelor s degree in Business and Administration
+from The Chinese University of Hong Kong and law degree from the University of London. Mr. Tse also has a Master of Chinese Law from
+Renmin University of China.
+
+ 
+
+ 91
+
+ 
+
+ 
+
+ 
+
+Family Relationships
+
+ 
+
+None of our directors, director
+nominees or executive officers has a family relationship as defined in Item 401 of Regulation S-K.
+
+ 
+
+Compensation of Executive Directors and Executive
+Officers
+
+ 
+
+The
+following table sets forth the summary compensation of our Executive Officers and Executive Directors for the six months ended March 31,
+2025 and 2024.
+
+ 
+
+Summary
+Compensation Table
+
+ 
+
+ 
+ 
+ Compensation Paid 
+ 
+
+ 
+ Name and Principal Position 
+ Year 
+ Salary (US$) 
+ Bonus (US$) 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Jerry Chi Wai Chan, 
+ 2025 
+ 54,005 
+ - 
+
+ 
+ Executive Director and Chief Executive Officer 
+ 2024 
+ 53,728 
+ - 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Jimmy Shui Wai Chan, 
+ 2025 
+ 46,290 
+ - 
+
+ 
+ Executive Director and Chief Financial Officer 
+ 2024 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Rico Kai To Chan, Executive Director 
+ 2025 
+ - 
+ - 
+
+ 
+ 
+ 2024 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Francis Po Kiu Fong, Independent Director Nominee 
+ 2024 
+ - 
+ - 
+
+ 
+ 
+ 2023 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Willde Nang Fong Ng, Independent Director Nominee 
+ 2025 
+ - 
+ - 
+
+ 
+ 
+ 2024 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Annet Yan Yee Kung, Independent Director Nominee 
+ 2025 
+ - 
+ - 
+
+ 
+ 
+ 2024 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Hoi Fat Tse, Independent Director Nominee 
+ 2025 
+ - 
+ - 
+
+ 
+ 
+ 2024 
+ - 
+ - 
+
+ 
+
+ 
+
+The following table set forth
+the summary compensation of our Executive Officers and Executive Directors for the financial years ended September 30, 2024 and
+2023.
+
+ 
+
+Summary Compensation Table
+
+ 
+
+ 
+ 
+ 
+ Compensation Paid
+ 
+ 
+ 
+
+ 
+ Name and Principal Position
+ 
+ Year
+ 
+ Salary
+(US$)
+ 
+ 
+ Bonus
+(US$)
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Jerry Chi Wai Chan,
+ 
+ 2024
+ 
+ 
+ 107,692
+ 
+ 
+ 
+ -
+ 
+
+ 
+ Executive Director and Chief Executive Officer
+ 
+ 2023
+ 
+ 
+ 98,717
+ 
+ 
+ 
+ -
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Jimmy Shui Wai Chan,
+ 
+ 2024
+ 
+ 
+ 46,154
+ 
+ 
+ 
+ -
+ 
+
+ 
+ Executive Director and Chief Financial Officer
+ 
+ 2023
+ 
+ 
+ -
+ 
+ 
+ 
+ -
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Rico Kai To Chan, Executive Director
+ 
+ 2024
+ 
+ 
+ -
+ 
+ 
+ 
+ -
+ 
+
+ 
+ 
+ 
+ 2023
+ 
+ 
+ -
+ 
+ 
+ 
+ -
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Francis Po Kiu Fong, Independent Director Nominee
+ 
+ 2024
+ 
+ 
+ -
+ 
+ 
+ 
+ -
+ 
+
+ 
+ 
+ 
+ 2023
+ 
+ 
+ -
+ 
+ 
+ 
+ -
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Willde Nang Fong Ng, Independent Director Nominee
+ 
+ 2024
+ 
+ 
+ -
+ 
+ 
+ 
+ -
+ 
+
+ 
+ 
+ 
+ 2023
+ 
+ 
+ -
+ 
+ 
+ 
+ -
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Annet Yan Yee Kung, Independent Director Nominee
+ 
+ 2024
+ 
+ 
+ -
+ 
+ 
+ 
+ -
+ 
+
+ 
+ 
+ 
+ 2023
+ 
+ 
+ -
+ 
+ 
+ 
+ -
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Hoi Fat Tse, Independent Director Nominee
+ 
+ 2024
+ 
+ 
+ -
+ 
+ 
+ 
+ -
+ 
+
+ 
+ 
+ 
+ 2023
+ 
+ 
+ -
+ 
+ 
+ 
+ -
+ 
+
+ 
+ 
+
+Directors Agreements
+
+ 
+
+Each of our Directors has entered
+into a director s agreement with our Company effective upon effectiveness of the Registration Statement of which this prospectus
+forms a part. The terms and conditions of such Directors Agreements are similar in all material aspects. Each director s
+agreement is for an initial term of one year and will automatically renew for successive one-year terms subject to termination by either
+party to the agreement upon 60 days prior written notice or the equivalent salary in lieu of such notice and until the Director
+successor is duly elected and qualified. Each Director will be up for re-election each year at the annual shareholders meeting
+and, upon re-election, the terms and provisions of his or her director s agreement will remain in full force and effect. Any director s
+agreement may be terminated for any or no reason by the Director or at a meeting called expressly for that purpose by a vote of the shareholders
+holding more than 50% of our Company s issued and outstanding shares entitled to vote.
+
+ 
+
+Under the Directors agreements,
+we intend to pay the following annual director fees to our Independent Director Nominees:
+
+ 
+
+ 
+ Director Nominee
+ 
+ Director Fee (USD)
+ 
+
+ 
+ Francis Po Kiu Fong
+ 
+ 
+ 1,500
+ 
+
+ 
+ Willde Nang Fong Ng
+ 
+ 
+ 1,500
+ 
+
+ 
+ Annet Yan Yee Kung
+ 
+ 
+ 2,000
+ 
+
+ 
+ Hoi Fat Tse
+ 
+ 
+ 1,500
+ 
+
+ 
+ 
+
+Such director fees are payable
+on a monthly basis.
+
+ 
+
+In addition, our Directors will
+be entitled to participate in such share option scheme as may be adopted by our Company, as amended from time to time. The number of options
+granted, and the terms of those options will be determined from time to time by a vote of the Board; provided that each Director shall
+abstain from voting on any such resolution or resolutions relating to the grant of options to that Director.
+
+ 
+
+Other than as disclosed above,
+none of our Directors has entered into a service agreement with our Company or any of our subsidiaries that provides for benefits upon
+termination of employment.
+
+ 
+
+Involvement in Certain Legal Proceedings
+
+ 
+
+To the best of our knowledge,
+none of our directors, director nominees or executive officers has, during the past 10 years, been involved in any legal proceedings as
+described in subparagraph (f) of Item 401 of Regulation S-K.
+
+ 
+
+ 92
+
+ 
+
+ 
+
+ 
+
+Composition of Board of Directors
+
+ 
+
+Our board of directors will consist
+of seven directors, comprising three executive directors and four independent directors upon completion of this offering. There is no
+shareholding qualification for directors. A director may vote with respect to any contract, proposed contract, or arrangement that he
+or she may have a material interest in, providing that appropriate disclosures were made to the board of directors in accordance with
+our Amended and Restated Memorandum and Articles of Association, such director should also always take into account his or her duties
+as a director. Subject to our Amended and Restated Memorandum and Articles of Association, a director may exercise all the powers of the
+Company to borrow money, mortgage its business, property and uncalled capital, and issue debentures or other securities whenever money
+is borrowed or as security for any obligation of the Company or of any third party.
+
+ 
+
+Our board of directors has determined
+that none of our independent directors has a relationship that would interfere with the exercise of independent judgment in carrying out
+the responsibilities of director and that each of these directors is "independent" as that term is defined under the rules
+of Nasdaq.
+
+ 
+
+Status as a Controlled Company and Foreign Private
+Issuer
+
+ 
+
+We are not required to comply
+with certain corporate governance requirements as a "controlled company", and as a "foreign private issuer" as
+defined by the SEC, we are also permitted to follow home country corporate governance practices in lieu of certain corporate governance
+practices required by Nasdaq for U.S. domestic issuers. While we will follow many of the corporate governance listing requirements of
+Nasdaq on a purely voluntary basis, we intend to follow certain home country corporate governance practices in lieu of the certain corporate
+governance standards of Nasdaq that are applicable to U.S. domestic issuers. For instance, we do not intend to follow Nasdaq Rule 5605(b)(2),
+which requires independent directors to meet in executive session regularly, without members of management present. Our independent directors
+may choose to meet in executive session at their discretion. We may in the future decide to use other foreign private issuer exemptions
+with respect to some or all of the other Nasdaq Listing Rules. Following our home country governance practices may provide less protection
+than is accorded to investors under Nasdaq Listing Rules applicable to domestic issuers.
+
+ 
+
+Specifically, the Company intends
+to follow the provisions of the laws of the Cayman Islands and once adopted in connection with this offering, its Amended and Restated
+Memorandum and Articles of Association in lieu of certain corporate governance requirements under the Nasdaq Listing Rules:
+
+ 
+
+ 
+ 
+ 
+ Rule 5605(b)(2), pursuant to which the independent directors must have regularly scheduled meetings at which only independent directors are present.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Rule 5635(a), pursuant to which shareholder approval is required in certain circumstances prior to an issuance of securities in connection with the acquisition of the stock or assets of another company.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Rule 5635(b), pursuant to which shareholder approval is required prior to the issuance of securities when the issuance or potential issuance will result in a change of control of the company.
+
+ 
+ 
+
+However, there are certain Nasdaq
+Listing Rules that we must comply with, for instance, Nasdaq s notification of non-compliance requirement (Nasdaq Rule 5625) and
+the Voting Rights requirement (Nasdaq Rule 5640). Further, we must have a written charter for our audit committee specifying the authority
+and responsibilities required by Exchange Act Rule 10A-3 and requiring that the audit committee consist of members who meet the independence
+requirements of Nasdaq Rule 5605(c)(2)(A)(ii).
+
+ 
+
+ 93
+
+ 
+
+ 
+
+ 
+
+We shall take all necessary actions
+to maintain compliance as a foreign private issuer under the applicable corporate governance requirements of the Sarbanes-Oxley Act, the
+rules adopted by the SEC and the Nasdaq Listing Rules.
+
+ 
+
+Because we are a foreign private
+issuer, our directors and senior management are not subject to short-swing profit and insider trading reporting obligations under Section
+16 of the Exchange Act. They will, however, be subject to the obligations to report changes in share ownership under Section 13 of the
+Exchange Act and related SEC rules.
+
+ 
+
+Duties of Directors
+
+ 
+
+Under Cayman Islands law, directors
+of a Cayman Islands company owe fiduciary duties to the company and, separately, a duty of care, diligence and skill to the company. Under
+Cayman Islands law, directors and officers owe the following fiduciary duties: (i) duty to act in good faith in what the director or officer
+believes to be in the best interests of the company and the shareholders as a whole; (ii) duty to exercise powers for the purposes for
+which those powers were conferred and not for a collateral purpose; (iii) directors should not fetter the exercise of future discretion;
+(iv) duty of trusteeship of the company s assets; (v) duty to exercise independent judgment; (vi) duty not to make secret profits
+from the office of director; (vii) duty to avoid putting themselves in a position in which there is a conflict between their duty to the
+company and their personal interests; and (viii) duty to disclose personal interest in contracts involving the company. In connection
+with this last obligation, our Amended and Restated Memorandum and Articles of Association will provide that a director must disclose
+the nature and extent of their interest in any contract or arrangement, and following such disclosure and subject to any separate requirement
+under applicable law or the Nasdaq Listing Rules, such director may vote in respect of any transaction or arrangement in which they have
+a material interest in and may be counted in the quorum at the meeting, provided that such interest does not affect the ability of the
+interested director(s) to act bona fide in the best interests of the company. A director of a Cayman Islands company also owes the company
+duties to exercise independent judgment in carrying out his functions and to exercise reasonable skill, care and diligence, which has
+both objective and subjective elements. Recent English and Commonwealth courts have moved toward an objective standard and have confirmed
+that directors must exercise the care, skill and diligence that would be exercised by a reasonably diligent person having the general
+knowledge, skill and experience reasonably to be expected of a person acting as a director and these authorities are likely to be followed
+in the Cayman Islands. Additionally, directors must exercise the knowledge, skill and experience which they actually possess under Cayman
+Islands law. We have the right to seek damages if a duty owed by our Directors is breached. In limited exceptional circumstances, a shareholder
+may have the right to seek damages in our name if a duty owed by our Directors is breached. In accordance with the Amended and Restated
+Memorandum and Articles of Association, the functions and powers of our board of directors include, among others, (i) convening shareholders 
+general meetings and reporting its work to shareholders at such meetings, (ii) declaring and paying interim dividends and final dividends
+in accordance with the respective rights of the shareholders, (iii) appointing and removing any person as chief executive officer, vice-presidents,
+treasurer, assistant treasurer, executive officers, company secretary or to any office that may be required for the period and on the
+terms as the directors think fit, and (iv) approving the transfer of shares of our Company, including the registering of such shares in
+our share register. In addition, in the event of an equality of vote, the chairman of board meetings or general meetings shall have a
+second or casting vote.
+
+ 
+
+Board Diversity
+
+ 
+
+While we do not have a formal
+policy on diversity, we seek to achieve board diversity through the consideration of a number of factors when selecting the candidates
+to our board of directors, including but not limited to gender, skills, age, professional experience, knowledge, cultural, education background,
+ethnicity and length of service. Our board of directors believes that diversity promotes a variety of ideas, judgments and considerations
+to the benefit of our Company and shareholders. The ultimate decision of the appointment will be based on merit and the contribution which
+the selected candidates will bring to our board of directors.
+
+ 
+
+Committees of the Board of Directors
+
+ 
+
+Prior to the effectiveness of
+the registration statement of which this prospectus is a part, we intend to establish an audit committee, a compensation committee and
+a nomination committee, each of which will operate pursuant to a charter adopted by our Board that will be effective upon the effectiveness
+of the registration statement of which this prospectus is a part. The Board may also establish other committees from time to time to assist
+our Company and the Board. Upon the effectiveness of the registration statement of which this prospectus is a part, the composition and
+functioning of all of our committees will comply with all applicable requirements of the Sarbanes-Oxley Act of 2002, Nasdaq and SEC rules
+and regulations, if applicable. Upon our listing on Nasdaq, each committee s charter will be available on our website at www.mediaondigital.com.
+The reference to our website address does not constitute incorporation by reference of the information contained at or available through
+our website, and you should not consider it to be part of this prospectus.
+
+ 
+
+ 94
+
+ 
+
+ 
+
+ 
+
+Audit committee
+
+ 
+
+Annet Yan Yee Kung, Francis Po
+Kiu Fong and Hoi Fat Tse, all of whom are Independent Directors Nominees, will serve on the audit committee, which will be chaired by
+Annet Yan Yee Kung. Our Board has determined that each are "independent" for audit committee purposes as that term is defined
+by the rules of the SEC and Nasdaq, and that each has sufficient knowledge in financial and auditing matters to serve on the audit committee.
+Our Board has designated Annet Yan Yee Kung as an "audit committee financial expert," as defined under the applicable rules
+of the SEC. The audit committee s responsibilities include:
+
+ 
+
+ 
+ 
+ 
+ appointing, approving the compensation of, and assessing the independence of our independent registered public accounting firm;
+
+ 
+ 
+ 
+ pre-approving auditing and permissible non-audit services, and the terms of such services, to be provided by our independent registered public accounting firm;
+
+ 
+ 
+ 
+ reviewing the overall audit plan with our independent registered public accounting firm and members of management responsible for preparing our financial statements;
+
+ 
+ 
+ 
+ reviewing and discussing with management and our independent registered public accounting firm our annual and quarterly financial statements and related disclosures as well as critical accounting policies and practices used by us;
+
+ 
+ 
+ 
+ coordinating the oversight and reviewing the adequacy of our internal control over financial reporting;
+
+ 
+ 
+ 
+ establishing policies and procedures for the receipt and retention of accounting-related complaints and concerns; recommending, based upon the audit committee s review and discussions with management and our independent registered public accounting firm, whether our audited financial statements shall be included in our Annual Report on Form 20-F;
+
+ 
+ 
+ 
+ monitoring the integrity of our financial statements and our compliance with legal and regulatory requirements as they relate to our financial statements and accounting matters;
+
+ 
+ 
+ 
+ preparing the audit committee report required by SEC rules to be included in our annual proxy statement;
+
+ 
+ 
+ 
+ reviewing all related person transactions for potential conflict of interest situations and approving all such transactions; and
+
+ 
+ 
+ 
+ reviewing earnings releases.
+
+ 
+ 
+
+Compensation committee
+
+ 
+
+Hoi Fat Tse, Annet Yan Yee Kung,
+and Willde Nang Fong Ng, all of whom are Independent Directors Nominees, will serve on the compensation committee, which will be chaired
+by Hoi Fat Tse. Our Board has determined that each such member satisfies the "independence" requirements of Rule 5605(a)(2)
+of the Listing Rules of the Nasdaq. The compensation committee s responsibilities include:
+
+ 
+
+ 
+ 
+ 
+ evaluating the performance of our Chief Executive Officer in light of our Company s corporate goals and objectives and based on such evaluation: (i) recommending to the Board the cash compensation of our Chief Executive Officer, and (ii) reviewing and approving grants and awards to our Chief Executive Officer under equity-based plans;
+
+ 
+ 
+ 
+ reviewing and recommending to the Board the cash compensation of our other Executive Officers;
+
+ 
+ 
+ 
+ reviewing and establishing our overall management compensation, philosophy and policy;
+
+ 
+ 
+ 
+ overseeing and administering our compensation and similar plans;
+
+ 
+ 
+ 
+ reviewing and approving the retention or termination of any consulting firm or outside advisor to assist in the evaluation of compensation matters and evaluating and assessing potential and current compensation advisors in accordance with the independence standards identified in the applicable Nasdaq;
+
+ 
+ 
+ 
+ retaining and approving the compensation of any compensation advisors;
+
+ 
+ 
+ 
+ reviewing and approving our policies and procedures for the grant of equity-based awards;
+
+ 
+ 
+ 
+ reviewing and recommending to the Board the compensation of our Directors; and
+
+ 
+ 
+ 
+ preparing the compensation committee report required by SEC rules, if and when required.
+
+ 
+ 
+
+ 95
+
+ 
+
+ 
+
+ 
+
+Nomination committee
+
+ 
+
+Francis Po Kiu Fong, Annet Yan
+Yee Kung and Willde Nang Fong Ng, all of whom are Independent Directors Nominees, will serve on the nomination committee, which will be
+chaired by Francis Po Kiu Fong. Our Board has determined that each member of the nomination committee is "independent" as
+defined in the applicable Nasdaq. The nomination committee s responsibilities include:
+
+ 
+
+ 
+ 
+ 
+ developing and recommending to the Board s criteria for board and committee membership;
+
+ 
+ 
+ 
+ establishing procedures for identifying and evaluating Director candidates, including nominees recommended by stockholders; and
+
+ 
+ 
+ 
+ reviewing the composition of the Board to ensure that it is composed of members containing the appropriate skills and expertise to advise us.
+
+ 
+ 
+
+While we do not have a formal
+policy regarding board diversity, our nomination committee and Board will consider a broad range of factors relating to the qualifications
+and background of nominees, which may include diversity (not limited to race, gender or national origin). Our nomination committee s
+and Board s priority in selecting board members is identification of persons who will further the interests of our shareholders
+through their established record of professional accomplishment, the ability to contribute positively to the collaborative culture among
+board members, knowledge of our business, understanding of the competitive landscape and professional and personal experience and expertise
+relevant to our growth strategy.
+
+ 
+
+Corporate Governance
+
+ 
+
+Prior to the effectiveness of
+the registration statement of which this prospectus is a part, we intend to adopt a formal policy regarding board diversity and our nomination
+committee and Board will consider a broad range of factors relating to the qualifications and background of nominees, which may include
+diversity (not limited to race, gender or national origin). Our nomination committee s and Board s priority in selecting board
+members is identification of persons who will further the interests of our shareholders through their established record of professional
+accomplishment, the ability to contribute positively to the collaborative culture among board members, knowledge of our business, understanding
+of the competitive landscape and professional and personal experience and expertise relevant to our growth strategy.
+
+ 
+
+Code of Business Conduct and Ethics
+
+ 
+
+We intend to adopt a code of business
+conduct and ethics immediately upon listing, which will be applicable to all of our directors, executive officers and employees. Such
+code of business conduct and ethics requires all our directors, executive officers and employees to avoid any action or position where
+their own interests may conflict, or appear to conflict, with the interests of the Company.
+
+ 
+
+Insider Trading Policies
+
+ 
+
+Effective October 23, 2000, the
+SEC adopted rules related to insider trading. One of these rules, Rule 10b5-1 of the Securities Exchange Act of 1934, as amended, provides
+an exemption to the insider trading rules in the form of an affirmative defense. Rule 10b5-1 recognizes the creation of formal programs
+under which executives and other insiders may sell the securities of publicly traded companies on a regular basis pursuant to written
+plans that are entered into at a time when the plan participants are not aware of material non-public information and that otherwise comply
+with the requirements of Rule 10b5-1.
+
+ 
+
+Our Board has adopted an insider
+trading policy that allows insiders to sell securities of our Company pursuant to pre-arranged trading plans.
+
+ 
+
+Compensation of Directors and Executive Officers
+
+ 
+
+Under Cayman Islands law, we are
+not required to disclose the compensation paid to our executive officers on an individual basis and we have not otherwise disclosed this
+information elsewhere.
+
+ 
+
+Outstanding Equity Awards at Fiscal Year-End
+
+ 
+
+We have not yet adopted any incentive
+plans, cash incentive or performance-based compensation programs, and have not granted any equity awards to our directors or executive
+officers during the years ended September 30, 2024 and 2023 and during the six months ended March 31, 2025 and 2024.
+
+ 
+
+ 96
+
+ 
+
+ 
+
+ 
+
+PRINCIPAL SHAREHOLDERS AND
+SELLING SHAREHOLDER
+
+ 
+
+The
+following table sets forth information with respect to the beneficial ownership, within the meaning of Rule 13d-3 under the Exchange Act,
+of our Class A Ordinary Shares as of the date of this prospectus, and as adjusted to reflect the sale of the Class A Ordinary
+Share offered in this offering for:
+
+ 
+
+ each
+ of our directors, director nominees and executive officers who beneficially own our Class A
+ Ordinary Shares; and
+
+ each
+ person known to us to own beneficially more than 5.0% of our Class A Ordinary Shares.
+
+ 
+
+Beneficial
+ownership includes voting or investment power with respect to the securities. Except as indicated below, and subject to applicable community
+property laws, the persons named in the table have sole voting and investment power with respect to all Ordinary Shares shown as beneficially
+owned by them. Percentage of beneficial ownership of each listed person prior to this offering is based on 3,500,000 Class A
+Ordinary Shares and 16,500,000 Class B Ordinary Shares outstanding as of the date of this prospectus. With effect immediately
+prior to the completion of the initial public offering of the Company s Class A Ordinary Shares, there will be 3,500,000 Class
+A Ordinary Shares outstanding and 16,500,000 Class B Ordinary Shares issued and outstanding. Percentage of beneficial ownership of
+each listed person after this offering includes Ordinary Shares outstanding immediately after the completion of this offering.
+
+ 
+
+The
+number and percentage of Ordinary Shares beneficially owned immediately after the offering are based on 5,500,000 Class A
+Ordinary Shares outstanding following the sale of 2,000,000 Class A Ordinary Shares in the offering and 16,500,000
+Class B Ordinary Shares outstanding. The following table assumes that the over-allotment option is not being exercised by the underwriter
+and none of our officers, directors or 5% or greater beneficial owners of our Ordinary Shares will purchase shares in this offering.
+Information with respect to beneficial ownership has been furnished by each director, officer or beneficial owner of 5% or more of either
+our Class A Ordinary Shares or Class B Ordinary Shares. Beneficial ownership is determined in accordance with the rules of
+the SEC and generally requires that such person have voting or investment power with respect to securities. In computing the number of
+Class A Ordinary Shares and/or Class B Ordinary Shares beneficially owned by a person listed below and the percentage ownership
+of such person, Class A Ordinary Shares and Class B Ordinary Shares underlying options, warrants or convertible securities
+held by each such person that are exercisable or convertible within 60 days of the date of this prospectus are deemed outstanding,
+but are not deemed outstanding for computing the percentage ownership of any other person.
+
+ 
+
+ 
+ 
+ 
+ Beneficial
+ Ownership Prior to the Offering 
+ 
+ Beneficial Ownership After
+ the Offering 
+ 
+ 
+ 
+
+ 
+ 
+ Class A Ordinary Shares 
+ Class B Ordinary Shares 
+ 
+ Class A Ordinary Shares 
+ Class B Ordinary Shares 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Name
+ of Beneficial
+
+Owner
+
+ 
+ Number (1) 
+ % of Beneficial
+ ownership of Class A Ordinary Shares 
+ Number (1) 
+ % of Beneficial
+ ownership of Class B Ordinary Shares 
+ % of Aggregate Voting
+
+ Power(4) 
+ Number 
+ % of Beneficial
+ ownership of Class A Ordinary Shares 
+ Number 
+ % of Beneficial
+ ownership of Class B Ordinary Shares 
+ Total
+
+Ordinary
+
+Shares on an
+
+As-Converted
+
+Basis*
+
+ 
+ %
+ of
+
+Total
+
+Ordinary
+
+Shares on an
+
+As-Converted
+
+Basis*
+
+ 
+ % of Aggregate Voting Power** 
+
+ 
+ Directors
+ and Executive Officers(1): 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Jerry Chi Wai Chan 
+ — 
+ — 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Jimmy Shu Wai Chan 
+ — 
+ — 
+ 16,500,000 
+ 100.00% 
+ 98.36% 
+ — 
+ — 
+ 16,500,000 
+ 97.37% 
+ 16,500,000 
+ 75.00% 
+ 98.36%
+
+ 
+ Rico Kai To Chan 
+ — 
+ — 
+ — 
+ — 
+ 
+ — 
+ — 
+ — 
+ — 
+ — 
+ 
+ — 
+
+ 
+ Francis Po Kiu Fong 
+ — 
+ — 
+ — 
+ — 
+ 
+ — 
+ — 
+ — 
+ — 
+ — 
+ — 
+ — 
+
+ 
+ Willde Nang Fong Ng 
+ — 
+ — 
+ — 
+ — 
+ 
+ — 
+ — 
+ — 
+ — 
+ — 
+ — 
+ — 
+
+ 
+ Annet Yan Yee Kung 
+ — 
+ — 
+ — 
+ — 
+ 
+ — 
+ — 
+ — 
+ — 
+ — 
+ — 
+ — 
+
+ 
+ Hoi Fat Tse 
+ — 
+ — 
+ — 
+ — 
+ 
+ — 
+ — 
+ — 
+ — 
+ — 
+ — 
+ — 
+
+ 
+ Directors and executive officers as a group 
+ 
+ 
+ 16,500,000 
+ 100% 
+ 
+ 
+ —% 
+ 16,500,000 
+ 97.37% 
+ 16,500,000 
+ 75% 
+ 98.36%
+
+ 
+ 5% of Greater Shareholders: 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Tech Vision Investment Limited 
+ 
+ 
+ 16,500,000 
+ 100.00% 
+ 
+ 
+ 
+ 16,500,000 
+ 97.37% 
+ 
+ 
+ 
+
+ 
+ Rich Choice Ventures Limited 
+ 
+ 1,000,000 
+ 
+ 28.57% 
+ — 
+ — 
+ 0.30% 
+ 1000000 
+ 4.55% 
+ 
+ 
+ 0.30%
+
+ 
+ 
+ 
+ 
+ 
+ 
+ — 
+ — 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Meta World Group Limited 
+ 
+ 1,000,000 
+ 
+ 28.57% 
+ — 
+ — 
+ 0.30% 
+ 1000000 
+ 4.55% 
+ 
+ 
+ 0.30%
+
+ 
+ 
+ 
+ 
+ 
+ 
+ — 
+ — 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Distinctive Idea Enterprise Limited 
+ 600,000 
+ 17.14% 
+ — 
+ — 
+ 0.18% 
+ 600000 
+ 2.73% 
+ 
+ 
+ 
+ 
+ 0.18%
+
+ 
+ Magic Summit Ventures Limited 
+ 900,000 
+ 25.71% 
+ 
+ 
+ 0.27% 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ (1)
+ Tech Vision Investment
+ Limited is wholly owned by Vizz Technology Limited, a Hong Kong company and indirectly wholly owned by Vizz Group (Holding) Limited,
+ a Hong Kong company.
+
+ 
+ (2)
+ Mr. Jerry Chi Wai Chan
+ is a director of and owns 5.18% of Vizz Group (Holding) Limited and is deemed to be the beneficial owner of the shares
+ held by Tech Vision Investment Limited.
+
+ 
+ (3)
+ Mr. Jimmy Shu Wai Chan
+ is a director of and owns 36.09% of Vizz Group (Holding) Limited and is deemed to be the beneficial owner of the shares
+ held by Tech Vision Investment Limited.
+
+ 
+ (4)
+ Calculated
+ based on total outstanding Ordinary Shares of 20,000,000 immediately prior to this offering, of which 16,500,000 are
+ Class B Ordinary Shares and 3,500,000 are Class A Ordinary Shares.
+
+ 
+ (5)
+ Calculated
+ based on total outstanding Ordinary Shares of 22,000,000 immediately after this offering, assuming that no over-allotment
+ option is exercised, of which 16,500,000 are Class B Ordinary Shares and 5,500,000 are Class A Ordinary Shares.
+
+ 
+ 
+
+ 97
+
+ 
+
+ 
+
+ 
+
+Selling Shareholders
+
+ 
+
+This prospectus
+covers the offering of 1,900,000 Class A Ordinary Shares by the Selling Shareholders, which consists of all of the Class
+A Ordinary Shares held by the Selling Shareholders immediately prior to the offering. The Class A Ordinary Shares owned
+by the Selling Shareholders are "restricted" securities under applicable United States federal and state securities
+laws and are being registered pursuant to this prospectus to enable the Selling Shareholders the opportunity to sell those Class
+A Ordinary Shares.
+
+ 
+
+The following table
+sets forth the name of the Selling Shareholders, the number and percentage of Class A Ordinary Shares beneficially owned
+by the Selling Shareholders immediately prior to the offering, the number of Class A Ordinary Shares that may be sold in
+this offering and the number and percentage of Class A Ordinary Shares the Selling Shareholders will own immediately after
+the offering. The information appearing in the table below is based on information provided by or on behalf of the named Selling Shareholders.
+We will not receive any proceeds from the sale of the Ordinary Shares by the Selling Shareholders.
+
+ 
+
+ 
+ Name of Selling Shareholder 
+ Class A Ordinary Shares Beneficially
+ Owned Immediately Prior to this offering 
+ Percentage Ownership
+
+ Immediately
+ Prior to this offering(1)
+ 
+ Number of Class A Ordinary Shares
+ to be Sold 
+ Number of Class A Ordinary Shares
+ Owned After this offering 
+ Percentage
+ Ownership After this offering(1) 
+
+ 
+ Magic Summit Ventures Ltd. (2) 
+ 900,000 
+ 4.5% 
+ 900,000 
+ — 
+ —%
+
+ 
+ Meta World Group Limited (3) 
+ 1,000,000
+ 
+ 5.0% 
+ 1,000,000
+ 
+ — 
+ —%
+
+ 
+
+ 
+
+(1)Based
+ on 20,000,000 Class A Ordinary Shares issued and outstanding immediately prior to
+ the offering and based on 22,000,000 Class A Ordinary Shares to be issued and
+ outstanding immediately after the offering.
+
+(2)Yuk
+ Tong Lam is a sole director and shareholder of Magic Summit Ventures Limited.
+
+ (3)Siu
+ Kei Chan is a sole director and shareholder of Meta World Group Limited.
+
+ 
+
+ 
+
+ 98
+
+ 
+
+ 
+
+ 
+
+RELATED PARTY TRANSACTIONS
+
+ 
+
+We have adopted an audit committee
+charter, which requires the committee to review all related party transactions on an ongoing basis and all such transactions be approved
+by the committee.
+
+ 
+
+Set forth below are related party
+transactions of our Company for the three years ended September 30, 2024, 2023 and 2022,
+which are identified in accordance with the rules prescribed under Form F-1 and Form 20-F and may not be considered as related party
+transactions under Hong Kong law.
+
+ 
+
+ 
+ 
+ 
+ 
+ As of September 30, 
+
+ 
+ 
+ 
+ 
+ 2024 
+ 2023 
+ 2022
+ (unaudited)
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Due from related parties consist of the following: 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Due from related companies 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Madcradle Online Limited 
+ Purchase of media cost to/from related company, working capital
+ 
+ $- 
+ $834,957 
+ - 
+
+ 
+ Maxzer Limited 
+ Purchase of media cost to/from related company, working capital
+ 
+ 109,418 
+ 181,683 
+ 46,560 
+
+ 
+ MGV Innovation Limited 
+ Purchase of media cost to/from related company, working capital
+ 
+ 56,504 
+ 30,776 
+ - 
+
+ 
+ Vizz Group (Holdings) Ltd. 
+ Working capital
+ 
+ 1,566,668 
+ 1,528,824 
+ 990,078 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ $1,732,590 
+ 2,576,240 
+ 1,036,638 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Due to related parties consist of the following: 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Due to related companies: 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Madcradle Online Limited 
+ Purchase of media cost to/from related company, working capital
+ 
+ $429,648 
+ $- 
+ $453,947 
+
+ 
+ Maxzer Ltd. 
+ 
+ 
+ - 
+ - 
+ - 
+
+ 
+ Vizz Technology Limited 
+ Purchase of media cost to/from related company, working capital
+ 
+ 496,060 
+ 573,964 
+ 411,943 
+
+ 
+ 
+ 
+ 
+ $925,708 
+ $573,964 
+ $865,890 
+
+ 
+ Due to directors: 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Chan Shu Wai 
+ Settlement for related companies, Working capital
+ 
+ 555,013 
+ 2,248,218 
+ 2,179,654 
+
+ 
+ Chan Chi Wai 
+ Working capital
+ 
+ 76,508 
+ 129,638 
+ 42,398 
+
+ 
+ 
+ 
+ 
+ $631,521 
+ $2,377,856 
+ $2,222,052 
+
+ 
+
+ 
+
+Additional
+information about related party transactions:
+
+ 
+
+ 
+ 
+ 
+ For the year ended September
+ 30, 
+
+ 
+ 
+ 
+ 2024 
+ 2023 
+ 2022
+ (unaudited)
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Revenue from related parties
+ 
+ $27,094 
+ $24,460 
+ $14,844 
+
+ 
+ Management fee accrued to Vizz Technology Limited
+ 
+ $76,798 
+ $153,237 
+ $214,758 
+
+ 
+ Lease from related parties
+ 
+ $100,605 
+ $93,890 
+ $79,930 
+
+ 
+ Lease termination expenses
+ 
+ $21,859 
+ $- 
+ $- 
+
+ 
+ Cost of sales to related parties
+ 
+ $1,522 
+ $7,683 
+ $37,077 
+
+ 
+
+ 
+
+Below
+is the summary of amounts due from and due to related parties as of the following dates:
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ As of 
+
+September 30, 2025 
+
+(Unaudited)
+ 
+ As
+of 
+ March 31, 2025
+
+ (Unaudited)
+
+ 
+ 
+ As of 
+
+September 30, 2024
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Due
+ from related parties consist of the following:
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Due
+ from related companies
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Maxzer
+ Limited
+ 
+ Amount
+ due from related company
+ 
+ 
+ -
+ 
+ 
+ 
+ -
+ 
+ 
+ 
+ 109,418
+ 
+
+ 
+ MGV
+ Innovation Limited
+ 
+ Amount
+ due from related company
+ 
+ 
+ -
+ 
+ 
+ 
+ 54,939
+ 
+ 
+ 
+ 56,504
+ 
+
+ 
+ Vizz
+ Group (Holdings) Ltd.
+ 
+ Amount
+ due from shareholder
+ 
+ 
+ -
+ 
+ 
+ 
+ 1,564,534
+ 
+ 
+ 
+ 1,566,668
+ 
+
+ 
+ 
+ 
+ 
+ 
+ $
+ -
+ 
+ 
+ $
+ 1,619,473
+ 
+ 
+ $
+ 1,732,590
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Due
+ to related parties consist of the following:
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Due
+ to related companies:
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Madcradle
+ Online Limited
+ 
+ Amount
+ due to related company
+ 
+ $
+ -
+ 
+ 
+ $
+ 481,030
+ 
+ 
+ $
+ 429,648
+ 
+
+ 
+ Maxzer
+ Limited
+ 
+ Amount
+ due to related company
+ 
+ 
+ 23,121
+ 
+ 
+ 
+ 26,337
+ 
+ 
+ 
+ -
+ 
+
+ 
+ Vizz
+ Technology Limited
+ 
+ Amount
+ due to related company
+ 
+ 
+ 358,714
+ 
+ 
+ 
+ 439,194
+ 
+ 
+ 
+ 496,060
+ 
+
+ 
+ 
+ 
+ 
+ 
+ $
+ 381,835
+ 
+ 
+ $
+ 946,561
+ 
+ 
+ $
+ 925,708
+ 
+
+ 
+ Due
+ to directors:
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Chan
+ Shu Wai
+ 
+ Settlement
+ of related companies and working capital
+ 
+ $
+ 16,634
+ 
+ 
+ $
+ 528,935
+ 
+ 
+ $
+ 555,013
+ 
+
+ 
+ Chan
+ Chi Wai
+ 
+ Working
+ capital
+ 
+ 
+ -
+ 
+ 
+ 
+ 65,571
+ 
+ 
+ 
+ 76,508
+ 
+
+ 
+ 
+ 
+ 
+ 
+ $
+ 16,634
+ 
+ 
+ $
+ 594,506
+ 
+ 
+ $
+ 631,521
+ 
+
+ 
+ 
+
+ 99
+
+ 
+
+ 
+
+ 
+
+In
+addition to the transactions and balances detailed elsewhere in these audited consolidated financial statements, the Company had the
+following transactions with related parties:
+
+ 
+
+ 
+ 
+ For the year
+ ended September 30,
+ (Unaudited)
+ 
+ For the six months period
+
+ ended March 31,
+
+ (Unaudited)
+ 
+
+ 
+ 
+ 2025 
+ 2025 
+ 2024 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Revenue from related parties 
+ $8,359 
+ $5,305 
+ $9,912 
+
+ 
+ Management fee accrued to Vizz Technology Limited 
+ $76,974 
+ $38,575 
+ $38,378 
+
+ 
+ Lease from related parties 
+ $76,974 
+ $46,290 
+ $67,928 
+
+ 
+ Lease termination expenses 
+ $- 
+ $- 
+ $21,847 
+
+ 
+ Cost of sales to related parties 
+ $5,662 
+ $5,642 
+ $693 
+
+ 
+
+ 
+
+The
+Company has entered a management fee agreement with Vizz Group ("Holdings") Limited with monthly payments, amounting to $6,429
+(HK$50,000) and $6,396 (HK$50,000) for the six months ended March 31, 2025 and 2024, respectively, and an unaudited $6,415 (HK$50,000)
+for the year ended September 30, 2025.
+
+ 
+
+The
+Company has entered into an internal office rental sharing agreement with its related parties, with Vizz Technologies Limited (Vizz Tech)
+acting as the centralized collection agent for other related parties. The premises are contracted by Vizz Group (Holdings) Ltd and Vizz
+Tech with the lessors. The first office space s lease period was from April 15, 2022 to December 14, 2023, with a monthly shared
+rent of $7,329 (HK$57,000). It was terminated on December 14, 2023, the termination expense was $21,847 (HK$170,775). The second office
+space s lease period was from September 1, 2023 to August 31, 2027, with a monthly shared rent and service charge of $7,697 (HK$60,000).
+
+ 
+
+ 
+ 
+ 
+ Nature
+ of relationships with related parties
+
+ 
+ 
+
+ 
+ Name
+ 
+ Relationship
+ with the Group
+
+ 
+ Maxzer
+ Limited
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO
+
+ 
+ Madcradle
+ Online Limited
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO
+
+ 
+ MGV
+ Innovation Limited (formerly known as Vizz Solutions Limited)
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO
+
+ 
+ Vizz
+ Technology Limited
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO
+
+ 
+ Vizz
+ Group (Holdings) Limited
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO
+
+ 
+ Timway
+ Limited
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO
+
+ 
+ MuseLife
+ Hong Kong Limited
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO
+
+ 
+ Unience
+ Limited
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO and, Mr. Chan Chi Wai Jerry, common director,
+ shareholder and CEO
+
+ 
+ Mr.
+ Chan Shu Wai Jimmy
+ 
+ Common
+ director, shareholder and CFO
+
+ 
+ Mr.
+ Chan Chi Wai Jerry
+ 
+ Common
+ director, shareholder, chairman and CEO
+
+ 
+ Mr.
+ Chan Shu Kin Peter
+ 
+ Director
+ and shareholder of related party
+
+ 
+ 
+
+Management
+Fee:
+
+ 
+
+In
+connection with the management services cover with the sharing of the director fee, human resources, profession accountings, IT support
+and administrative team for utilizing group resources, a management fee is charged and accrued to Vizz Technology Limited:
+
+ 
+
+ 
+ 
+ 
+ Director
+ management fee: 40% of the total management fee will be allocated for direct management services rendered.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ HR,
+ administrative and accounting support fee: 30% of the total management fee will be designated for human resources, administrative
+ support and accounting support ensuring effective operational management.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ IT
+ technical support fee: The remaining 30% of the total management fee will be allocated for support related to the facilitating
+ efficient computer, data management and reporting capabilities.
+
+ 
+ 
+
+This
+fee structure is designed to ensure that all aspects of management, administrative, accounting, and information systems support are sufficiently
+funded to facilitate sharing and enhance operational effectiveness.
+
+ 
+
+Purchase
+of media cost:
+
+ 
+
+ The
+ cost associated with media purchase (media placement cost) induced when other related party
+ companies which are treated as ordinary clients outsourced the media placement aspect of
+ a project to MediaOn which is positioned as professional in media placements.
+
+ Because
+ of certain polices that limited number of customers of each vendor account of certain third-party media performs, we have to place advertisements via multiple business entities, i.e.
+ related parties. As a result, there are numbers of related party transactions.
+
+ And
+ due to historical reason, MediaOn was formed after Madcradle, the setups and contracts in
+ various media platforms are under the name of Madcradle. By the decision of management, there
+ was a re-structuring of the business of the group and moved the media rebate related business
+ to MediaOn. However, MediaOn s clients accounts still stay under Madcradle in the early days
+ since the transition and shift of business to MediaOn. In a new media platform, under the
+ new contract, Madcradle has media placements through MediaOn. Therefore, there are still a large
+ amount of these transactions for this purpose to settle the cost of media placements through Madcradle s
+ account. But, no profit is generated in these transactions.
+
+ 
+
+ 100
+
+ 
+
+ 
+
+ 
+
+DESCRIPTION OF SHARE CAPITAL
+
+ 
+
+We are an exempted company incorporated
+in the Cayman Islands with limited liability and our corporate affairs are governed by our Amended and Restated Memorandum and Articles
+of Association, as amended from time to time, the Companies Act (as amended) of the Cayman Islands (the "Companies Act"),
+and the common law of the Cayman Islands.
+
+ 
+
+As of the date of this prospectus,
+our authorized share capital is US$50,000 divided into 233,500,000 Class A Ordinary Shares of a par value of US$0.0002
+each, and 16,500,000 Class B Ordinary Shares of a par value of US$0.0002 each. As of the date of this prospectus, there
+are 3,500,000 Class A Ordinary Shares and 16,500,000 Class B Ordinary Shares issued and outstanding. Immediately
+prior to the offering there will be 3,500,000 Class A Ordinary Shares and 16,500,000 Class B Ordinary Shares issued and outstanding.
+Upon the completion of this offering, the authorized share capital of the Company will be US$50,000 divided into 233,500,000 Class
+A Ordinary Shares of a par value of US$0.0002 each, and 16,500,000 Class B Ordinary Shares of a par value of US$0.0002 each.
+
+ 
+
+Our shareholders adopted
+an Amended and Restated Memorandum and Articles of Association, which become effective and replace our current Memorandum and Articles
+of Association in its entirety immediately prior to the completion of this offering.
+
+ 
+
+The following are summaries of
+material provisions of the Amended and Restated Memorandum and Articles of Association which become effective immediately prior
+to completion of this offering, insofar as they relate to the material terms of our Class A Ordinary Shares.
+
+ 
+
+Ordinary Shares. Our Ordinary
+Shares are divided into Class A Ordinary Shares and Class B Ordinary Shares. Holders of Class A Ordinary Shares and Class B Ordinary
+Shares have the same rights except for voting and conversion rights. Each Class A Ordinary Share shall entitle the holder thereof to
+one (1) vote on all matters subject to vote at the general meetings, and each Class B Ordinary Share shall entitle the holder thereof
+to twenty (20) votes on all matters subject to vote at the general meetings. Each Class B Ordinary Share is convertible into
+one (1) Class A Ordinary Share at any time at the option of the holder thereof. In no event shall Class A Ordinary Shares be convertible
+into Class B Ordinary Shares. Our Ordinary Shares are issued in registered form and are issued when registered in its register of
+members. In no event shall Class A Ordinary Shares be convertible into Class B Ordinary Shares. All of our outstanding shares
+are fully paid and non-assessable, they are issued in registered form and are issued when registered in our register of members. We may
+not issue shares to bearer. Our shareholders who are non-residents of the Cayman Islands may freely hold and vote their shares.
+
+ 
+
+Dividends. The holders
+of our Class A Ordinary Shares are entitled to such dividends as may be declared by our board of directors subject to the Companies Act.
+Further, although our shareholders have the right to declare dividends by way of ordinary resolution, no dividend shall exceed the amount
+recommended by our directors. Our Amended and Restated Memorandum and Articles of Association will provide that the directors may, before
+recommending or declaring any dividend, set aside out of the funds legally available for distribution such sums as they think proper as
+a reserve or reserves which shall, in the absolute discretion of the directors, be applicable for meeting contingencies or for equalizing
+dividends or for any other purpose to which those funds may be properly applied. Under Cayman Islands law, our Company may pay a dividend
+out of either profit or the credit standing in our Company s share premium account or as otherwise permitted by the Companies Act,
+provided that in no circumstances may a dividend be paid if this would result in our Company being unable to pay its debts as they fall
+due in the ordinary course of business immediately following the date on which the distribution or dividend is paid.
+
+ 
+
+Voting Rights. Voting
+at any general meeting shall be by poll. Subject to any rights and restrictions attached to any shares, on a poll, every shareholder
+present in person or by proxy or, in the case of a shareholder being a corporation, by its duly authorised representative shall have
+(i) one vote for every Class A Ordinary Share of which he is the holder and (ii) twenty (20) votes for every Class B Ordinary
+Share of which he is the holder.
+
+ 
+
+An ordinary resolution to be passed
+by the shareholders requires the affirmative vote of a simple majority of the votes attaching to the Ordinary Shares cast at a meeting,
+while a special resolution requires the affirmative vote of no less than two-thirds of the votes cast attaching to the Ordinary Shares
+at a meeting. Holders of Ordinary Shares may, among other things, divide or combine their shares by ordinary resolution, whereas, a special
+resolution will be required for important matters such as a change of name or making changes to our Amended and Restated Memorandum and
+Articles of Association.
+
+ 
+
+ 101
+
+ 
+
+ 
+
+ 
+
+General Meetings of Shareholders.
+We are not obliged by the Companies Act to call shareholders annual general meetings as a Cayman Islands exempted company.
+Our Amended and Restated Memorandum and Articles of Association will provide that we may (but are not obliged to) in each year hold a
+general meeting as our annual general meeting in which case we shall specify the meeting as such in the respective notices calling it,
+and the annual general meeting shall be held at such time and place as may be determined by our board of directors.
+
+ 
+
+Shareholders general meetings
+may be convened by a majority of our board of directors. Advance notice of at least ten (10) clear days is required for the convening
+of our annual general meeting (if any) and any other general meeting of our shareholders. A quorum required for any general meeting of
+shareholders consists of at least one shareholder present or by proxy, representing not less than one-third of all votes attaching to
+all of our shares in issue and entitled to vote.
+
+ 
+
+The Companies Act provides shareholders
+with only limited rights to requisition a general meeting, and does not provide shareholders with any right to put any proposal before
+a general meeting. However, these rights may be provided in a company s articles of association. Our Amended and Restated Memorandum
+and Articles of Association will provide that upon the requisition of shareholders representing, as at the date of the deposit of the
+requisition, in aggregate not less than one-third of the votes attaching to the issued and outstanding shares of our Company that as
+at the date of the deposit entitled to vote at general meetings, our chairman or board will convene an extraordinary general meeting
+and put the resolutions so requisitioned to a vote at such meeting.
+
+ 
+
+Conversion
+Rights. Each Class B Ordinary Share is convertible into one (1) Class A Ordinary Share at any time at the option of the holder thereof.
+Upon any sale, transfer, assignment or disposition of any Class B Ordinary Share by a Shareholder to any person who is not the Designated
+Person or an Affiliate of the Designated Person, or upon a change of ultimate beneficial ownership of any Class B Ordinary Share to any
+Person who is not the Designated Person or an Affiliate of the Designated Person, such Class B Ordinary Share shall be automatically
+and immediately converted into the same number of Class A Ordinary Share. For the avoidance of doubt, (i) where a sale, transfer, assignment
+or disposition involves a change to the legal title to Class B Ordinary Shares, it shall be effective upon the Company s registration
+of such sale, transfer, assignment or disposition in its Register, and where a sale, transfer, assignment or disposition involves a change
+to the ultimate beneficial ownership or there is otherwise no change to the legal title to Class B Ordinary Shares, it shall be deemed
+effective at the time of the change, as determined in good faith by the Directors in their sole discretion; and (ii) the creation of
+any pledge, charge, encumbrance or other third party right of whatever description on any Class B Ordinary Shares to secure a holder s
+contractual or legal obligations shall not be deemed as a sale, transfer, assignment or disposition, or a change of ultimate beneficial
+ownership, unless and until any such pledge, charge, encumbrance or other third party right is enforced and results in the third party
+holding legal title to the relevant Class B Ordinary Shares, in which case all the related Class B Ordinary Shares shall be automatically
+converted into the same number of Class A Ordinary Shares. For the purposes of this Article 15, beneficial ownership shall have the meaning
+set forth in Rule 13d-3 under the United States Securities Exchange Act of 1934, as amended. Designed Person means Shu
+Wai CHAN, the founder of the Company.
+
+ 
+
+Transfer of Ordinary Shares.
+Subject to the restrictions set out in our Amended and Restated Memorandum and Articles of Association, any of our shareholders may
+transfer all or any of his or her Ordinary Shares by an instrument of transfer in the usual or common form or any other form approved
+by our board of directors.
+
+ 
+
+Liquidation. On the winding
+up of our Company, assets available for distribution amongst our shareholders shall be distributed amongst our shareholders in proportion
+to the par value of the shares held by them at the commencement of the winding up, subject to a deduction from those shares in respect
+of which there are monies due, of all monies payable to our Company for unpaid calls or otherwise. If our assets available for distribution
+are insufficient to repay the whole of the share capital, the assets will be distributed so that the losses are borne by our shareholders
+in proportion to the par value of the shares held by them.
+
+ 
+
+Calls on Shares and Forfeiture
+of Shares. Our board of directors may from time to time make calls upon shareholders for any amounts unpaid on their shares in a
+notice served to such shareholders at least fourteen (14) calendar days prior to the specified time or times of payment. The shares
+that have been called upon and remain unpaid are subject to forfeiture.
+
+ 
+
+Redemption, Repurchase and
+Surrender of Shares. Subject to the Companies Act, we may issue shares on terms that are subject to redemption, at our option or at
+the option of the holders of these shares, on such terms and in such manner as may be determined by our board of directors. We may also
+repurchase any of our shares on such terms and in such manner as have been approved by our board of directors or by an ordinary resolution
+of our shareholders.
+
+ 
+
+Under the Companies Act, the redemption
+or repurchase of any share may be paid out of our profits, out of the share premium account, or out of the proceeds of a new issue of
+shares made for the purpose of such redemption or repurchase, or out of capital (including share premium account and capital redemption
+reserve) if our Company can, immediately following such payment, pay its debts as they fall due in the ordinary course of business. In
+addition, under the Companies Act no such share may be redeemed or repurchased (a) unless it is fully paid up, (b) if such redemption
+or repurchase would result in there being no shares outstanding or (c) if the company has commenced liquidation. In addition, our Company
+may accept the surrender of any fully paid share for no consideration.
+
+ 
+
+Modification of Rights of Shares.
+If at any time our share capital is divided into different classes of shares, the rights attached to any class of shares (unless otherwise
+provided by the terms of issue of the shares of that class), whether or not our Company is being wound-up, may be varied with the consent
+in writing of the holders of at least two-thirds of the issued shares of that class or with the sanction of a special resolution passed
+at a separate meeting of the holders of the shares of the class. The rights conferred upon the holders of the shares of any class issued
+shall not, unless otherwise expressly provided by the terms of issue of the shares of that class, be deemed to be varied by the creation
+or issue of further shares ranking pari passu with such existing class of shares.
+
+ 
+
+ 102
+
+ 
+
+ 
+
+ 
+
+Issuance of Additional Shares.
+Our Amended and Restated Memorandum and Articles of Association authorize its board of directors to issue additional Ordinary Shares
+from time to time as the board of directors shall determine, to the extent out of available authorized but unissued Ordinary Shares.
+
+ 
+
+Our Amended and Restated Memorandum
+and Articles of Association also authorize its board of directors to establish from time to time one or more series of preferred shares
+and to determine, with respect to any series of preferred shares, the terms and rights of that series, including:
+
+ 
+
+ 
+ 
+ 
+ the designation of the series;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the number of shares of the series;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the dividend rights, conversion rights, voting rights; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the terms of redemption and liquidation preferences.
+
+ 
+ 
+
+Our Company s board of directors
+may issue preferred shares without action by its shareholders to the extent out of authorized but unissued preferred shares. Issuance
+of these shares may dilute the voting power of holders of Ordinary Shares.
+
+ 
+
+Inspection of Books and Records.
+Holders of our Ordinary Shares will have no general right under Cayman Islands law to inspect or obtain copies of our corporate records.
+
+ 
+
+Anti-Takeover Provisions. Some
+provisions of our Amended and Restated Memorandum and Articles of Association may discourage, delay or prevent a change of control of
+our Company or management that shareholders may consider favorable, including provisions that:
+
+ 
+
+ 
+ 
+ 
+ authorize our board of directors to issue preference shares in one or more series and to designate the price, rights, preferences, privileges and restrictions of such preference shares without any further vote or action by our shareholders; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ limit the ability of shareholders to requisition and convene general meetings of shareholders.
+
+ 
+ 
+
+However, under Cayman Islands
+law, our directors must only exercise the rights and powers granted to them under our Amended and Restated Memorandum and Articles of
+Association for a proper purpose and act bona fide in the best interests of our Company.
+
+ 
+
+Exempted Company. We are
+an exempted company with limited liability under the Companies Act. The Companies Act distinguishes between ordinary resident companies
+and exempted companies. Any company that is registered in the Cayman Islands but conducts business mainly outside of the Cayman Islands
+may apply to be registered as an exempted company. The requirements for an exempted company are essentially the same as for an ordinary
+company except that an exempted company:
+
+ 
+
+ 
+ 
+ 
+ does not have to file an annual return of its shareholders with the Registrar of Companies;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ is not required to open its register of members for inspection;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ does not have to hold an annual general meeting;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ may issue negotiable or bearer shares or shares with no par value;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ may obtain an undertaking against the imposition of any future taxation (such undertakings are usually given for 20 years in the first instance);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ may register by way of continuation in another jurisdiction and be deregistered in the Cayman Islands;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ may register as a limited duration company; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ may register as a segregated portfolio company.
+
+ 
+ 
+
+ 103
+
+ 
+
+ 
+
+ 
+
+"Limited liability"
+means that the liability of each shareholder is limited to the amount unpaid by the shareholder on the shares of the company (except in
+exceptional circumstances, such as involving fraud, the establishment of an agency relationship or an illegal or improper purpose or other
+circumstances in which a court may be prepared to pierce or lift the corporate veil).
+
+ 
+
+Differences in Corporate Law
+
+ 
+
+The Companies Act is derived,
+to a large extent, from the older Companies Acts of England but does not follow recent English statutory enactments and accordingly there
+are significant differences between the Companies Act and the current Companies Act of England. In addition, the Companies Act differs
+from laws applicable to U.S. corporations and their shareholders. Set forth below is a summary of certain significant differences between
+the provisions of the Companies Act applicable to us and the laws applicable to companies incorporated in the United States and their
+shareholders.
+
+ 
+
+Mergers and Similar Arrangements.
+The Companies Act permits mergers and consolidations between Cayman Islands companies and between Cayman Islands companies and non-Cayman
+Islands companies. For these purposes, (i) "merger" means the merging of two or more constituent companies and the vesting
+of their undertaking, property and liabilities in one of such companies as the surviving company, and (ii) a "consolidation"
+means the combination of two or more constituent companies into a consolidated company and the vesting of the undertaking, property and
+liabilities of such companies to the consolidated company. In order to effect such a merger or consolidation, the directors of each constituent
+company must approve a written plan of merger or consolidation, which must then be authorized by (a) a special resolution of the shareholders
+of each constituent company, and (b) such other authorization, if any, as may be specified in such constituent company s articles
+of association. The written plan of merger or consolidation must be filed with the Registrar of Companies of the Cayman Islands together
+with a declaration as to the solvency of the consolidated or surviving company, a list of the assets and liabilities of each constituent
+company and an undertaking that a copy of the certificate of merger or consolidation will be given to the members and creditors of each
+constituent company and that notification of the merger or consolidation will be published in the Cayman Islands Gazette. Court approval
+is not required for a merger or consolidation which is effected in compliance with these statutory procedures.
+
+ 
+
+A merger between a Cayman parent
+company and its Cayman subsidiary or subsidiaries does not require authorization by a resolution of shareholders of that Cayman subsidiary
+if a copy of the plan of merger is given to every member of that Cayman subsidiary to be merged unless that member agrees otherwise. For
+this purpose a company is a "parent" of a subsidiary if it holds issued shares that together represent at least 90% of the
+votes at a general meeting of the subsidiary.
+
+ 
+
+The consent of each holder of
+a fixed or floating security interest over a constituent company is required unless this requirement is waived by a court in the Cayman
+Islands.
+
+ 
+
+Save in certain limited circumstances,
+a shareholder of a Cayman constituent company who dissents from the merger or consolidation is entitled to payment of the fair value of
+his shares (which, if not agreed between the parties, will be determined by the Cayman Islands court) upon dissenting to the merger or
+consolidation, provide the dissenting shareholder complies strictly with the procedures set out in the Companies Act. The exercise of
+dissenter rights will preclude the exercise by the dissenting shareholder of any other rights to which he or she might otherwise be entitled
+by virtue of holding shares, save for the right to seek relief on the grounds that the merger or consolidation is void or unlawful.
+
+ 
+
+Separate from the statutory provisions
+relating to mergers and consolidations, the Companies Act also contains statutory provisions that facilitate the reconstruction and amalgamation
+of companies by way of schemes of arrangement, provided that the arrangement is approved (i) in the case of a shareholder scheme,
+by seventy-five per cent (75%) in value of the members or class of members, as the case may be, with whom the arrangement is to be made
+and (ii) in the case of a creditor scheme only, by a majority in number of each class of creditors with whom the arrangement is to be
+made and who must in addition represent seventy-five per cent (75%) in value of each such class of creditor, as the case may be,
+that are present and voting either in person or by proxy at a meeting, or meetings, convened for that purpose. The convening of the meetings
+and subsequently the arrangement must be sanctioned by the Grand Court of the Cayman Islands. While a dissenting shareholder has the
+right to express to the court the view that the transaction ought not to be approved, the court can be expected to approve the arrangement
+if it determines that:
+
+ 
+
+ 
+ 
+ 
+ the statutory provisions as to the required majority vote have been met;
+
+ 
+ 
+
+ 104
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ the shareholders have been fairly represented at the meeting in question and the statutory majority are acting bona fide without coercion of the minority to promote interests adverse to those of the class;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the arrangement is such that may be reasonably approved by an intelligent and honest man of that class acting in respect of his interest; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the arrangement is not one that would more properly be sanctioned under some other provision of the Companies Act.
+
+ 
+ 
+
+The Companies Act also contains
+a statutory power of compulsory acquisition which may facilitate the "squeeze out" of dissentient minority shareholder upon
+a tender offer. When a tender offer is made and accepted by holders of not less than ninety percent (90%) in value of the shares
+affected within four months, the offeror may, within a two-month period commencing on the expiration of such four-month period, require
+the holders of the remaining shares to transfer such shares to the offeror on the terms of the offer. An objection can be made to the
+Grand Court of the Cayman Islands but this is unlikely to succeed in the case of an offer which has been so approved unless there is
+evidence of fraud, bad faith or collusion.
+
+ 
+
+If an arrangement and reconstruction
+by way of scheme of arrangement is thus approved and sanctioned, or if a tender offer is made and accepted, a dissenting shareholder would
+have no rights comparable to appraisal rights, which would otherwise ordinarily be available to dissenting shareholders of Delaware corporations,
+providing rights to receive payment in cash for the judicially determined value of the shares.
+
+ 
+
+Shareholders Suits.
+In principle, we will normally be the proper plaintiff to sue for a wrong done to us as a company, and as a general rule a derivative
+action may not be brought by a minority shareholder. However, based on English authorities, which would in all likelihood be of persuasive
+authority in the Cayman Islands, the Cayman Islands court can be expected to follow and apply the common law principles (namely the rule
+in Foss v. Harbottle and the exceptions thereto) so that a non-controlling shareholder may be permitted to commence a class action against
+or derivative actions in the name of the company to challenge actions where:
+
+ 
+
+ 
+ 
+ 
+ a company acts or proposes to act illegally or ultra vires and is therefore incapable of ratification by the shareholder;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the act complained of, although not ultra vires, could only be effected duly if authorized by more than a simple majority vote that has not been obtained; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ those who control the company are perpetrating a "fraud on the minority."
+
+ 
+ 
+
+Indemnification of Directors
+and Executive Officers and Limitation of Liability. Cayman Islands law does not limit the extent to which a company s memorandum
+and articles of association may provide for indemnification of officers and directors, except to the extent any such provision may be
+held by the Cayman Islands courts to be contrary to public policy, such as to provide indemnification against civil fraud or the consequences
+of committing a crime. Our Amended and Restated Memorandum and Articles of Association provide that we shall indemnify our officers and
+directors against all actions, proceedings, costs, charges, expenses, losses, damages or liabilities incurred or sustained by such directors
+or officer, other than by reason of such person s dishonesty, willful default or fraud, in or about the conduct of our Company s
+business or affairs (including as a result of any mistake of judgment) or in the execution or discharge of his duties, powers, authorities
+or discretions, including without prejudice to the generality of the foregoing, any costs, expenses, losses or liabilities incurred by
+such director or officer in defending (whether successfully or otherwise) any civil proceedings concerning our Company or its affairs
+in any court whether in the Cayman Islands or elsewhere. This standard of conduct is generally the same as permitted under the Delaware
+General Corporation Law for a Delaware corporation.
+
+ 
+
+In addition, we intend to enter
+into indemnification agreements with our directors and executive officers prior to the completion of this offering, that provide such
+persons with additional indemnification beyond that provided in our Amended and Restated Memorandum and Articles of Association.
+
+ 
+
+Insofar as indemnification for
+liabilities arising under the Securities Act may be permitted to our directors, officers or persons controlling us under the foregoing
+provisions, we have been informed that in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities
+Act and is therefore unenforceable.
+
+ 
+
+ 105
+
+ 
+
+ 
+
+ 
+
+Directors Fiduciary
+Duties. Under Delaware corporate law, a director of a Delaware corporation has a fiduciary duty to the corporation and its shareholders.
+This duty has two components: the duty of care and the duty of loyalty. The duty of care requires that a director act in good faith, with
+the care that an ordinarily prudent person would exercise under similar circumstances. Under this duty, a director must inform himself
+of, and disclose to shareholders, all material information reasonably available regarding a significant transaction. The duty of loyalty
+requires that a director acts in a manner he reasonably believes to be in the best interests of the corporation. He must not use his corporate
+position for personal gain or advantage. This duty prohibits self-dealing by a director and mandates that the best interest of the corporation
+and its shareholders take precedence over any interest possessed by a director, officer or controlling shareholder and not shared by the
+shareholders generally. In general, actions of a director are presumed to have been made on an informed basis, in good faith and in the
+honest belief that the action taken was in the best interests of the corporation. However, this presumption may be rebutted by evidence
+of a breach of one of the fiduciary duties. Should such evidence be presented concerning a transaction by a director, the director must
+prove the procedural fairness of the transaction, and that the transaction was of fair value to the corporation.
+
+ 
+
+As a matter of Cayman Islands
+law, a director of a Cayman Islands company is in the position of a fiduciary with respect to the company and therefore it is considered
+that he owes the following duties to the company — a duty to act bona fide in the best interests of the company, a duty not to make
+a profit based on his position as director (unless the company permits him to do so), a duty not to put himself in a position where the
+interests of the company conflict with his personal interest or his duty to a third party, and a duty to exercise powers for the purpose
+for which such powers were intended. A director of a Cayman Islands company owes to the company a duty to act with skill and care. It
+was previously considered that a director need not exhibit in the performance of his duties a greater degree of skill than may reasonably
+be expected from a person of his knowledge and experience. However, English and Commonwealth courts have moved towards an objective standard
+with regard to the required skill and care and these authorities are likely to be followed in the Cayman Islands.
+
+ 
+
+Shareholder Action by Written
+Resolution. Under the Delaware General Corporation Law, a corporation may eliminate the right of shareholders to act by written consent
+by amendment to its certificate of incorporation. Our Amended and Restated Articles of Association provide that any ordinary or special
+resolution of shareholders and any other action that may be taken by the shareholders at a meeting may also be taken by a resolution consented
+to in writing, without the need for any notice, by all shareholders who would have been entitled to attend and vote at a meeting called
+for the purpose of passing such a resolution or taking any other action.
+
+ 
+
+Shareholder Proposals. Under
+the Delaware General Corporation Law, a shareholder has the right to put any proposal before the annual meeting of shareholders, provided
+it complies with the notice provisions in the governing documents. A special meeting may be called by the board of directors or any other
+person authorized to do so in the governing documents, but shareholders may be precluded from calling special meetings.
+
+ 
+
+The Companies Act provides shareholders
+with only limited rights to requisition a general meeting. However, these rights may be provided in a company s articles of association.
+Our Amended and Restated Articles of Association allow our shareholders holding at the date of deposit of requisition shares which carry
+in aggregate not less than one-third of all votes attaching to the issued and outstanding shares of our Company that as at the date of
+the deposit entitled to vote at general meetings to requisition an extraordinary general meeting of our shareholders, in which case our
+chairman or board is obliged to convene an extraordinary general meeting and to put the resolutions so requisitioned to a vote at such
+meeting. As an exempted Cayman Islands company, we may but are not obliged by law to call shareholders annual general meetings.
+See "Our Amended and Restated Memorandum and Articles of Association-General Meetings of Shareholders." for more information
+on the rights of our shareholders rights to put proposals before the annual general meeting.
+
+ 
+
+Cumulative Voting. Under
+the Delaware General Corporation Law, cumulative voting for elections of directors is not permitted unless the corporation s certificate
+of incorporation specifically provides for it. Cumulative voting potentially facilitates the representation of minority shareholders on
+a board of directors since it permits the minority shareholder to cast all the votes to which the shareholder is entitled for a single
+director, which increases the shareholder s voting power with respect to electing such director. There are no prohibitions in relation
+to cumulative voting under the laws of the Cayman Islands but our Amended and Restated Articles of Association do not provide for cumulative
+voting. As a result, our shareholders are not afforded any less protections or rights on this issue than shareholders of a Delaware corporation.
+
+ 
+
+Removal of Directors. Under
+the Delaware General Corporation Law, a director of a corporation with a classified board may be removed only for cause with the approval
+of a majority of the outstanding shares entitled to vote, unless the certificate of incorporation provides otherwise. Under our Amended
+and Restated Articles of Association, directors may be removed by the affirmative vote of the directors then in office or by an ordinary
+resolution of our shareholders. In addition, a director s office shall be vacated if the director (i) becomes bankrupt or makes
+any arrangement or composition with his creditors; (ii) is found to be or becomes of unsound mind or dies; (iii) resigns his office by
+notice in writing to the company; (iv) without special leave of absence from the board of directors, is absent from meetings of the board
+of directors for three consecutive meetings and the board of directors resolves that his office be vacated; (v) is prohibited by law from
+being a director; or (vi) is removed from office pursuant to any other provisions of our Amended and Restated Memorandum and Articles
+of Association.
+
+ 
+
+ 106
+
+ 
+
+ 
+
+ 
+
+Transactions with Interested
+Shareholders. The Delaware General Corporation Law contains a business combination statute applicable to Delaware corporations whereby,
+unless the corporation has specifically elected not to be governed by such statute by amendment to its certificate of incorporation, it
+is prohibited from engaging in certain business combinations with an "interested shareholder" for three years following the
+date that such person becomes an interested shareholder. An interested shareholder generally is a person or a group who or which owns
+or owned 15% or more of the target s outstanding voting share within the past three years. This has the effect of limiting the ability
+of a potential acquirer to make a two-tiered bid for the target in which all shareholders would not be treated equally. The statute does
+not apply if, among other things, prior to the date on which such shareholder becomes an interested shareholder, the board of directors
+approves either the business combination or the transaction which resulted in the person becoming an interested shareholder. This encourages
+any potential acquirer of a Delaware corporation to negotiate the terms of any acquisition transaction with the target s board of
+directors.
+
+ 
+
+Cayman Islands law has no comparable
+statute. As a result, we cannot avail ourselves of the types of protections afforded by the Delaware business combination statute. However,
+although Cayman Islands law does not regulate transactions between a company and its significant shareholders, it does provide that such
+transactions must be entered into bona fide in the best interests of the company and not with the effect of constituting a fraud on the
+minority shareholders.
+
+ 
+
+Dissolution; Winding up. Under
+the Delaware General Corporation Law, unless the board of directors approves the proposal to dissolve, dissolution must be approved by
+shareholders holding 100% of the total voting power of the corporation. Only if the dissolution is initiated by the board of directors
+may it be approved by a simple majority of the corporation s outstanding shares. Delaware law allows a Delaware corporation to include
+in its certificate of incorporation a supermajority voting requirement in connection with dissolutions initiated by the board.
+
+ 
+
+Under Cayman Islands law, a company
+may be wound up by either an order of the courts of the Cayman Islands or by a special resolution of its members or, if the company is
+unable to pay its debts as they fall due, by an ordinary resolution of its members. The court has authority to order winding up in a number
+of specified circumstances including where it is, in the opinion of the court, just and equitable to do so. Under the Companies Act and
+our Amended and Restated Articles of Association, our Company may be dissolved, liquidated or wound up by a special resolution of our
+shareholders.
+
+ 
+
+Variation of Rights of Shares.
+Under the Delaware General Corporation Law, a corporation may vary the rights of a class of shares with the approval of a majority
+of the outstanding shares of such class, unless the certificate of incorporation provides otherwise. Under Cayman Islands law and our
+Amended and Restated Articles of Association, if our share capital is divided into more than one class of shares, we may vary the rights
+attached to any class with the written consent of the holders of two-thirds of the issued shares of that class or with the sanction of
+a special resolution passed at a general meeting of the holders of the shares of that class.
+
+ 
+
+Amendment of Governing Documents.
+Under the Delaware General Corporation Law, a corporation s governing documents may be amended with the approval of a majority
+of the outstanding shares entitled to vote, unless the certificate of incorporation provides otherwise. Under the Companies Act and our
+Amended and Restated Memorandum and Articles of Association, our Amended and Restated Memorandum and Articles of Association may only
+be amended by a special resolution of our shareholders.
+
+ 
+
+Rights of Non-resident or Foreign
+Shareholders. There are no limitations imposed by our Amended and Restated Memorandum and Articles of Association on the rights of
+non-resident or foreign shareholders to hold or exercise voting rights on our shares. In addition, there are no provisions in our Amended
+and Restated Memorandum and Articles of Association governing the ownership threshold above which shareholder ownership must be disclosed.
+
+ 
+
+Transfer Agent and Registrar
+
+ 
+
+The U.S. transfer agent and registrar
+for the Ordinary Shares is VStock Transfer, LLC, 18 Lafayette Place, Woodmere, New York 11598; telephone: 212-828-8436, toll-free: 855-9VSTOCK.
+
+ 
+
+History of Securities Issuances
+
+ 
+
+The following is a summary of
+the securities issuances by our Company since its inception. None of transactions set forth below involved any underwriter, underwriting
+discounts or commissions, or any public offering. We believe that each of the following transactions was exempt from registration under
+the Securities Act in reliance on Regulation S or Rule 701 under the Securities Act or pursuant to Section 4(a)(2) of the Securities
+Act regarding transactions not involving a public offering.
+
+ 
+
+The table below illustrates
+the breakdown of Ordinary Shares issued on July 29, 2024 to each of our shareholders as of the date of this prospectus.
+
+ 
+
+ 
+ Name of shareholder
+ 
+ Number of Ordinary Shares
+ allotted and issued (After the Reverse Stock Split)*
+
+ 
+ Tech Vision Investments Limited
+ 
+ 
+ 16,500,000 Class B
+
+ Ordinary Shares
+
+ 
+ Rich Choice Ventures Limited
+ 
+ 
+ 1,000,000 Class A
+
+ Ordinary Shares
+
+ 
+ Meta World Group Limited
+ 
+ 
+ 1,000,000 Class A
+
+ Ordinary Shares
+
+ 
+ Distinctive Idea Enterprise Limited
+ 
+ 
+ 600,000 Class A
+
+ Ordinary Shares
+
+ 
+ Magic Summit Ventures Limited
+ 
+ 
+ 900,000 Class A
+
+ Ordinary Shares
+
+ 
+ Total:
+ 
+ 20,000,000 Ordinary Shares
+
+ 
+ 
+
+* On September 1, 2025,
+the Company effected a reverse stock split (the" Reverse Stock Split") of the Company s issued and outstanding Ordinary
+Shares at a split ratio of 1-for-2 such that every holder of Class A and Class B Ordinary Shares shall receive one share for every two
+shares of Ordinary shares held. All references to number of shares have been retroactively adjusted.
+
+ 
+
+ 107
+
+ 
+
+ 
+
+ 
+
+CERTAIN CAYMAN ISLANDS COMPANY CONSIDERATIONS
+
+ 
+
+Exempted Company
+
+ 
+
+We are an exempted company with
+limited liability under the Companies Act. The Companies Act distinguishes between ordinary resident companies and exempted companies.
+Any company that is registered in the Cayman Islands but conducts business mainly outside of the Cayman Islands may apply to be registered
+as an exempted company. The requirements for an exempted company are essentially the same as for an ordinary company except for the exemptions
+and privileges listed below:
+
+ 
+
+ 
+ 
+ 
+ an exempted company does not have to file an annual return of its shareholders with the Registrar of Companies in the Cayman Islands;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an exempted company s register of members is not open to inspection;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an exempted company does not have to hold an annual general meeting;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an exempted company may issue no par value, negotiable or bearer shares;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an exempted company may obtain an undertaking against the imposition of any future taxation;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an exempted company may register by way of continuation in another jurisdiction and be deregistered in the Cayman Islands;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an exempted company may register as a limited duration company; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an exempted company may register as a segregated portfolio company.
+
+ 
+ 
+
+"Limited liability" means that the liability
+of each shareholder is limited to the amount unpaid by the shareholder on the shares of our Company.
+
+ 
+
+Register of Members
+
+ 
+
+Under the Companies Act, we must
+keep a register of members and there should be entered therein:
+
+ 
+
+ 
+ 
+ 
+ the names and addresses of our members, and a statement of the shares held by each member distinguishing each share by its number (so long as the share has a number), confirming the amount paid or agreed to be considered as paid on the shares of each member, confirming the number and category of shares held by each member, and confirming whether each relevant category of shares held by a member carries voting rights under the articles of association of our Company, and if so, whether such voting rights are conditional);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the date on which the name of any person was entered on the register as a member; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the date on which any person ceased to be a member.
+
+ 
+ 
+
+Under the Companies Act, the register
+of members of our Company is prima facie evidence of the matters set out therein (that is, the register of members will raise a presumption
+of fact on the matters referred to above unless rebutted) and a member registered in the register of members is deemed as a matter of
+the Companies Act to have legal title to the shares as set against its name in the register of members. Upon completion of this offering,
+we will perform the procedure necessary to immediately update the register of members to record and give effect to the issuance of shares
+by us to the depositary (or its nominee) as the depositary. Once our register of members has been updated, the shareholders recorded in
+the register of members will be deemed to have legal title to the shares set against their name.
+
+ 
+
+If the name of any person is incorrectly
+entered in or omitted from our register of members, or if there is any default or unnecessary delay in entering on the register the fact
+of any person having ceased to be a member of our Company, the person or member aggrieved (or any member of our Company or our Company
+itself) may apply to the Grand Court of the Cayman Islands for an order that the register be rectified, and the Court may either refuse
+such application or it may, if satisfied of the justice of the case, make an order for the rectification of the register.
+
+ 
+
+ 108
+
+ 
+
+ 
+
+ 
+
+Anti-Money Laundering – Cayman Islands
+
+ 
+
+If any person in the Cayman Islands
+knows or suspects or has reasonable grounds for knowing or suspecting that another person is engaged in criminal conduct or money laundering
+or is involved with terrorism or terrorist financing and property and the information for that knowledge or suspicion came to their attention
+in the course of business in the regulated sector, or other trade, profession, business or employment, the person will be required to
+report such knowledge or suspicion to (i) the Financial Reporting Authority of the Cayman Islands, pursuant to the Proceeds of Crime Act
+(As Revised) of the Cayman Islands if the disclosure relates to criminal conduct or money laundering, or (ii) a police officer of the
+rank of constable or higher, or the Financial Reporting Authority, pursuant to the Terrorism Act (As Revised) of the Cayman Islands, if
+the disclosure relates to involvement with terrorism or terrorist financing and property. Such a report shall not be treated as a breach
+of confidence or of any restriction upon the disclosure of information imposed by any enactment or otherwise.
+
+ 
+
+Data Protection – Cayman Islands
+
+ 
+
+We have certain duties under the
+Data Protection Act (as amended) of the Cayman Islands (the "Data Protection Act") based on internationally accepted principles
+of data privacy.
+
+ 
+
+Introduction
+
+ 
+
+This privacy notice puts our shareholders
+on notice that through your investment in our Company you will provide us with certain personal information which constitutes personal
+data within the meaning of the Data Protection Act ("personal data"). In the following discussion, the "company"
+refers to us and our affiliates and/or delegates, except where the context requires otherwise.
+
+ 
+
+Investor Data
+
+ 
+
+We will collect, use, disclose,
+retain and secure personal data to the extent reasonably required only and within the parameters that could be reasonably expected during
+the normal course of business. We will only process, disclose, transfer or retain personal data to the extent legitimately required to
+conduct our activities of on an ongoing basis or to comply with legal and regulatory obligations to which we are subject. We will only
+transfer personal data in accordance with the requirements of the Data Protection Act and will apply appropriate technical and organizational
+information security measures designed to protect against unauthorized or unlawful processing of the personal data and against the accidental
+loss, destruction or damage to the personal data.
+
+ 
+
+In our use of this personal data,
+we will be characterized as a "data controller" for the purposes of the Data Protection Act, while our affiliates and service
+providers who may receive this personal data from us in the conduct of our activities may either act as our "data processors"
+for the purposes of the Data Protection Act or may process personal information for their own lawful purposes in connection with services
+provided to us.
+
+ 
+
+We may also obtain personal data
+from other public sources. Personal data includes, without limitation, the following information relating to a shareholder and/or any
+individuals connected with a shareholder as an investor: name, residential address, email address, contact details, corporate contact
+information, signature, nationality, place of birth, date of birth, tax identification, credit history, correspondence records, passport
+number, bank account details, source of funds details and details relating to the shareholder s investment activity.
+
+ 
+
+Who this Affects
+
+ 
+
+If you are a natural person, this
+will affect you directly. If you are a corporate investor (including, for these purposes, legal arrangements such as trusts or exempted
+limited partnerships) that provides us with personal data on individuals connected to you for any reason in relation your investment in
+our Company, this will be relevant for those individuals and you should transmit the content of this Privacy Notice to such individuals
+or otherwise advise them of its content.
+
+ 
+
+ 109
+
+ 
+
+ 
+
+ 
+
+How our Company May Use a Shareholder s
+Personal Data
+
+ 
+
+Our Company, as the data controller,
+may collect, store and use personal data for lawful purposes, including, in particular:
+
+ 
+
+ 
+ 
+ (a)
+ where this is necessary for the performance of our rights and obligations under any purchase agreements;
+
+ 
+ 
+ (b)
+ where this is necessary for compliance with a legal and regulatory obligation to which we are subject (such as compliance with anti-money laundering requirements); and/or
+
+ 
+ 
+ (c)
+ where this is necessary for the purpose of our legitimate interests and such interests are not overridden by your interests, fundamental rights or freedoms.
+
+ 
+ 
+
+Should we wish to use personal
+data for other specific purposes (including, if applicable, any purpose that requires your consent), we will contact you.
+
+ 
+
+Why We May Transfer Your Personal Data
+
+ 
+
+In certain circumstances we may
+be legally obliged to share personal data and other information with respect to your shareholding with the relevant regulatory authorities
+such as the Cayman Islands Monetary Authority or the Tax Information Authority. They, in turn, may exchange this information with foreign
+authorities, including tax authorities.
+
+ 
+
+The Data Protection Measures We Take
+
+ 
+
+Any transfer of personal data
+by us or our duly authorized affiliates and/or delegates outside of the Cayman Islands shall be in accordance with the requirements of
+the Data Protection Act.
+
+ 
+
+We and our duly authorized affiliates
+and/or delegates shall apply appropriate technical and organizational information security measures designed to protect against unauthorized
+or unlawful processing of personal data, and against accidental loss or destruction of, or damage to, personal data.
+
+ 
+
+We shall notify you of any personal
+data breach that is reasonably likely to result in a risk to your interests, fundamental rights or freedoms or those data subjects to
+whom the relevant personal data relates.
+
+ 
+
+ 110
+
+ 
+
+ 
+
+ 
+
+SHARES ELIGIBLE FOR FUTURE SALE
+
+ 
+
+Upon completion of this offering,
+we will have 5,500,000 Class A Ordinary Shares and 16,500,000 Class B Ordinary Shares issued.
+
+ 
+
+All of the shares sold in this
+offering by our Company and by the Selling Shareholders will be freely transferable in the United States, without restriction
+or further registration under the Securities Act, by persons other than our "affiliates." Rule 144 of the Securities Act
+defines an "affiliate" of a company as a person that, directly or indirectly, through one or more intermediaries, controls
+or is controlled by, or is under common control with, our Company. All of our shares outstanding immediately prior to the completion
+of this offering are "restricted securities" as that term is defined in Rule 144 because they were issued in a transaction
+or series of transactions not involving a public offering. Restricted securities may be sold only if they are the subject of an effective
+registration statement under the Securities Act or if they are sold pursuant to an exemption from the registration requirement of the
+Securities Act such as those provided for in Rules 144 promulgated under the Securities Act, which rule is summarized below. Restricted
+shares may also be sold outside of the United States to non-U.S. persons in accordance with Rule 904 of Regulation S under the Securities
+Act. This prospectus may not be used in connection with any resale of our shares acquired in this offering by our affiliates.
+
+ 
+
+Sales of substantial amounts of
+our shares in the public market could adversely affect prevailing market prices of our shares. Prior to this offering, there has been
+no public market for our shares, and while we intend to apply for the listing of our shares on the Nasdaq, we cannot assure you that a
+regular trading market will develop in the shares.
+
+ 
+
+Lock-Up Agreements
+
+ 
+
+We have agreed with the underwriter,
+for a period of 12 months days after the date of this prospectus, subject to certain exceptions not to (1) offer, sell, issue, pledge,
+contract to sell, contract to purchase, grant any option, right or warrant to purchase, lend, make any short sale or otherwise transfer
+or dispose of, directly or indirectly, any shares or any other securities so owned convertible into or exercisable or exchangeable for
+shares, (2) enter into any swap, hedge or any other agreement that transfers, in whole or in part, the economic consequences of ownership
+of the shares, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of shares or such other
+securities, in cash or otherwise, or (3) file any registration statement with the SEC relating to the offering of any shares or any securities
+convertible into or exercisable or exchangeable for Shares, or publicly disclose the intention to take any such action. 
+
+ 
+
+Furthermore, each of our Directors
+and Executive Officers, has also entered into a similar lock-up agreement with the underwriter for a period of 12 months days from the
+date of this prospectus, subject to certain exceptions, with respect to our shares, and securities that are substantially similar to our
+shares. Our 5% or greater shareholders have entered into similar lock-up arrangements for a 6-month period.
+
+ 
+
+We cannot predict what effect,
+if any, future sales of our shares, or the availability of shares for future sale, will have on the trading price of our shares from time
+to time. Sales of substantial amounts of our shares in the public market, or the perception that these sales could occur, could adversely
+affect the trading price of our shares.
+
+ 
+
+Rule 144
+
+ 
+
+In general, under Rule 144 as
+currently in effect, once we have been subject to the public company reporting requirements of Section 13 or Section 15(d) of the Exchange
+Act for at least 90 days, persons who are not our affiliates and have beneficially owned our shares for more than six months but not more
+than one year may sell such shares without registration under the Securities Act subject to the availability of current public information
+about us. Persons who are not our affiliates and have beneficially owned our shares for more than one year may freely sell our shares
+without registration under the Securities Act. Persons who are our affiliates (including persons beneficially owning 10% or more of our
+outstanding shares), and have beneficially owned our shares for at least six months, may sell within any three-month period a number of
+restricted securities that does not exceed the greater of the following:
+
+ 
+
+ 
+ 
+ 
+ 1.0% of the then outstanding shares; or
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the average weekly trading volume of our shares during the four calendar weeks preceding the date on which notice of the sale on Form 144 is filed with the SEC by such person.
+
+ 
+ 
+
+Such sales are also subject to
+manner-of-sale provisions, notice requirements and the availability of current public information about us. In addition, in each case,
+these shares would remain subject to any applicable lock-up arrangements and would only become eligible for sale when the lock-up period
+expires.
+
+ 
+
+Resale Prospectus
+
+ 
+
+As described in the
+Explanatory Note to the registration statement of which this prospectus forms a part, the registration statement also contains the
+Resale Prospectus to be used in connection with the potential resale by the Resale Shareholders of our shares held by them. These
+shares have been registered to permit public resale of such shares, and the Resale Shareholders may offer the shares for resale from
+time to time pursuant to the Resale Prospectus. The 1,600,000 Ordinary Shares held by the Resale Shareholders immediately prior
+to this offering that are being registered concurrently for resale in the Resale Prospectus are not subject to lock-up
+agreements. The Resale Shareholders may also sell, transfer or otherwise dispose of all or a portion of their shares in
+transactions exempt from the registration requirements of the Securities Act or pursuant to another effective registration statement
+covering those shares. The Resale Shareholder will not sell any of the Resale Shares until such shares are listed on NASDAQ.
+
+ 
+
+ 111
+
+ 
+
+ 
+
+ 
+
+EXPENSES RELATED TO THIS OFFERING
+
+ 
+
+Set forth below is an itemization
+of the total expenses, excluding underwriting discounts, which are expected to be incurred by us in connection with the offer and sale
+of the shares by us and the Selling Shareholders. With the exception of the SEC registration fee, the Financial Industry Regulatory Authority
+("FINRA") filing fee and the Nasdaq listing fee, all amounts are estimates.
+
+ 
+
+ 
+ SEC Registration Fee
+ 
+ US$ 
+ 15,000
+ 
+
+ 
+ FINRA Filing Fee
+ 
+ US$
+ 10,000
+ 
+
+ 
+ Nasdaq Listing Fee
+ 
+ US$
+ 50,000
+ 
+
+ 
+ Printing and engraving expenses
+ 
+ US$
+ 15,000
+ 
+
+ 
+ Legal fees and expenses
+ 
+ US$
+ 498,500
+ 
+
+ 
+ Consulting fee
+ 
+ US$
+ 500,000
+ 
+
+ 
+ Miscellaneous
+ 
+ US$
+ 161,500
+ 
+
+ 
+ Total
+ 
+ US$
+ 1,250,000
+ 
+
+ 
+ 
+
+These expenses will be borne by
+us.
+
+ 
+
+ 112
+
+ 
+
+ 
+
+ 
+
+MATERIAL TAX CONSIDERATIONS
+
+ 
+
+The following summary of certain
+Cayman Islands and U.S. federal income tax consequences of an investment in our shares is based upon laws and relevant interpretations
+thereof in effect as of the date of this prospectus, all of which are subject to change. This summary does not deal with all possible
+tax consequences relating to an investment in the shares, such as the tax consequences under U.S. state and local tax laws or under the
+tax laws of jurisdictions other than the Cayman Islands and the United States. You are encouraged to consult your own tax advisors concerning
+the overall tax consequences arising in your own particular situation under U.S. federal, state, local or foreign law of the ownership
+of our shares. To the extent that this discussion relates to matters of Cayman Islands tax law, it is the opinion of Harney Westwood &
+Riegels, our counsel as to Cayman Islands law.
+
+ 
+
+Cayman Islands Tax Considerations
+
+ 
+
+The Cayman Islands currently levies
+no taxes on individuals or corporations based upon profits, income, gains or appreciation and there is no taxation in the nature of inheritance
+tax or estate duty. There are no other taxes likely to be material to us levied by the government of the Cayman Islands except for stamp
+duties which may be applicable on instruments executed in, or, after execution, brought within the jurisdiction of the Cayman Islands.
+The Cayman Islands is not party to any double tax treaties that are applicable to any payments made to or by our Company. There are no
+exchange control regulations or currency restrictions in the Cayman Islands.
+
+ 
+
+Payments of dividends and capital
+in respect of our shares will not be subject to taxation in the Cayman Islands and no withholding will be required on the payment of a
+dividend or capital to any holder of our shares, nor will gains derived from the disposal of our shares be subject to Cayman Islands income
+or corporation tax. There is no income tax treaty or convention currently in effect between the United States and the Cayman Islands.
+
+ 
+
+Economic Substance Legislation of the Cayman Islands
+
+ 
+
+The Cayman Islands enacted the
+International Tax Co-operation (Economic Substance) Act (2024 Revision) (the "Cayman Islands ES Act") together with the Guidance
+Notes published by the Cayman Islands Tax Information Authority from time to time. Under the Cayman Islands ES Act, if a company is considered
+to be a "relevant entity" and is conducting one or more of the nine "relevant activities" then that company will
+be required to comply with the economic substance requirements in relation to the relevant activity from 1 July 2019. All companies whether
+a relevant entity or not is required to file an annual report in the Cayman Islands with the Companies Registry confirming whether or
+not it is carrying on any relevant activities.
+
+ 
+
+United States Federal Income Tax Considerations
+
+ 
+
+The following discussion is a
+summary of U.S. federal income tax considerations generally applicable to the ownership and disposition of our shares by U.S. Holders
+(as defined below) that acquire our shares in this offering and hold our shares as "capital assets" (generally, property held
+for investment) under the United States Internal Revenue Code of 1986, as amended (the "Code"). This discussion is based upon
+existing United States federal income tax law which is subject to differing interpretations or change, possibly with retroactive effect.
+There can be no assurance that the Internal Revenue Service, or the IRS, or a court will not take a contrary position. This discussion
+does not address all aspects of United States federal income taxation that may be relevant to particular investors in light of their specific
+circumstances, including investors subject to special tax rules (for example, certain financial institutions (including banks), cooperatives,
+pension plans, insurance companies, broker-dealers, traders in securities that have elected the mark-to-market method of accounting for
+their securities, partnerships and their partners, regulated investment companies, real estate investment trusts, and tax-exempt organizations
+(including private foundations)), investors who are not U.S. Holders, investors who own (directly, indirectly, or constructively) 10%
+or more of our stock (by vote or value), investors that will hold their shares as part of a straddle, hedge, conversion, constructive
+sale, or other integrated transaction for United States federal income tax purposes, or U.S. Holders that have a functional currency other
+than the U.S. dollar, all of whom may be subject to tax rules that differ significantly from those summarized below. In addition, this
+discussion does not discuss any non-United States tax, state or local tax, or non-income tax (such as the U.S. federal gift or estate
+tax) considerations, or any consequences under the alternative minimum tax or Medicare tax on net investment income. Each U.S. Holder
+is urged to consult its tax advisor regarding the United States federal, state, local, and non-United States income and other tax considerations
+of an investment in our shares.
+
+ 
+
+ 113
+
+ 
+
+ 
+
+ 
+
+General
+
+ 
+
+For purposes of this discussion,
+a "U.S. Holder" is a beneficial owner of our shares that is, for United States federal income tax purposes, (i) an individual
+who is a citizen or resident of the United States, (ii) a corporation (or other entity treated as a corporation for United States federal
+income tax purposes) created in, or organized under the laws of, the United States or any state thereof or the District of Columbia, (iii)
+an estate the income of which is includible in gross income for United States federal income tax purposes regardless of its source, or
+(iv) a trust (A) the administration of which is subject to the primary supervision of a United States court and which has one or more
+United States persons who have the authority to control all substantial decisions of the trust or (B) that has otherwise validly elected
+to be treated as a United States person under the Code.
+
+ 
+
+If a partnership (or other entity
+or arrangement treated as a partnership for United States federal income tax purposes) is a beneficial owner of our shares, the tax treatment
+of a partner in the partnership will generally depend upon the status of the partner as a U.S. Holder, as described above, and the activities
+of the partnership. Partnerships holding our shares and partners in such partnerships are urged to consult their tax advisors as to the
+particular United States federal income tax consequences of an investment in our shares.
+
+ 
+
+Dividends
+
+ 
+
+The entire amount of any cash
+distribution paid with respect to our shares (including the amount of any non-U.S. taxes withheld therefrom, if any) generally will constitute
+dividends to the extent such distributions are paid out of our current or accumulated earnings and profits, as determined under United
+States federal income tax principles, and generally will be taxed as ordinary income in the year received by such U.S. Holder. To the
+extent amounts paid as distributions on the shares exceed our current or accumulated earnings and profits, such distributions will not
+be dividends, but instead will be treated first as a tax-free return of capital to the extent of the U.S. Holder s adjusted tax
+basis, determined for federal income tax purposes, in the shares with respect to which the distribution is made, and thereafter as capital
+gain. However, we do not intend to compute (or to provide U.S. Holders with the information necessary to compute) our earnings and profits
+under United States federal income tax principles. Accordingly, a U.S. Holder will be unable to establish that a distribution is not out
+of earnings and profits and should expect to treat the full amount of each distribution as a "dividend" for United States
+federal income tax purposes.
+
+ 
+
+Any dividends that we pay will
+generally be treated as income from foreign sources for United States foreign tax credit purposes and will generally constitute passive
+category income. Depending on the U.S. Holder s particular facts and circumstances, a U.S. Holder may be eligible, subject to a
+number of complex limitations, to claim a foreign tax credit in respect of any foreign withholding taxes imposed (at a rate not exceeding
+any applicable treaty rate) on dividends received on our shares. A U.S. Holder who does not elect to claim a foreign tax credit for foreign
+tax withheld may instead claim a deduction, for United States federal income tax purposes, in respect of such withholdings, but only for
+a year in which such U.S. Holder elects to do so for all creditable foreign income taxes. The rules governing the foreign tax credit are
+complex. U.S. Holders are advised to consult their tax advisors regarding the availability of the foreign tax credit under their particular
+circumstances.
+
+ 
+
+Dividends paid in non-U.S. currency
+will be included in the gross income of a U.S. Holder in a USD amount calculated by reference to a spot market exchange rate in effect
+on the date that the dividends are received by the U.S. Holder, regardless of whether such foreign currency is in fact converted into
+USD on such date. Such U.S. Holder will have a tax basis for United States federal income tax purposes in the foreign currency received
+equal to that USD value. If such dividends are converted into USD on the date of receipt, a U.S. Holder generally should not be required
+to recognize foreign currency gain or loss in respect thereof. If the foreign currency so received is not converted into USD on the date
+of receipt, such U.S. Holder will have a basis in the foreign currency equal to its USD value on the date of receipt. Any gain or loss
+on a subsequent conversion or other disposition of the foreign currency generally will be treated as ordinary income or loss to such U.S.
+Holder and generally will be income or loss from sources within the United States for foreign tax credit limitation purposes. U.S. Holders
+should consult their own tax advisors regarding the treatment of foreign currency gain or loss, if any, on any foreign currency received
+by a U.S. Holder that are converted into USD on a date subsequent to receipt.
+
+ 
+
+ 114
+
+ 
+
+ 
+
+ 
+
+Sale or Other Disposition of Shares
+
+ 
+
+A U.S. Holder will generally recognize
+capital gain or loss upon a sale or other disposition of shares, in an amount equal to the difference between the amount realized and
+the U.S. Holder s adjusted tax basis, determined for federal income tax purposes, in such shares, each amount determined in USD.
+Any capital gain or loss will be long-term capital gain or loss if the shares have been held for more than one year and will generally
+be United States source gain or loss for United States foreign tax credit purposes. The deductibility of a capital loss may be subject
+to limitations, particularly with regard to shareholders who are individuals. Each U.S. Holder is advised to consult its tax advisor regarding
+the tax consequences if a foreign tax is imposed on a disposition of our shares, including the availability of the foreign tax credit
+under its particular circumstances.
+
+ 
+
+A U.S. Holder that receives Hong
+Kong dollars or another currency other than USD on the disposition of our shares will realize an amount equal to the USD value of the
+non-U.S. currency received at the spot rate on the date of sale (or, if the shares are traded on a recognized exchange and in the case
+of cash basis and electing accrual basis U.S. Holders, the settlement date). An accrual basis U.S. Holder that does not elect to determine
+the amount realized using the spot rate on the settlement date will recognize foreign currency gain or loss equal to the difference between
+the USD value of the amount received based on the spot market exchange rates in effect on the date of sale or other disposition and the
+settlement date. A U.S. Holder will have a tax basis in the currency received equal to the USD value of the currency received on the settlement
+date. Any gain or loss on a subsequent disposition or conversion of the currency will be United States source ordinary income or loss.
+
+ 
+
+Passive Foreign Investment Company Considerations
+
+ 
+
+For United States federal income
+tax purposes, a non-United States corporation, such as our Company, will be treated as a "passive foreign investment company,"
+or "PFIC" if, in the case of any particular taxable year, either (a) 75% or more of our gross income for such year consists
+of certain types of "passive" income or (b) 50% or more of the value of our assets (generally determined on the basis of a
+quarterly average) during such year produce or are held for the production of passive income. Based upon our current and expected income
+and assets (including goodwill and taking into account the expected proceeds from this offering) and the expected market price of our
+shares following this offering, we do not expect to be a PFIC for the current taxable year or the foreseeable future.
+
+ 
+
+However, while we do not expect
+to be or become a PFIC, no assurance can be given in this regard because the determination of whether we are or will become a PFIC for
+any taxable year is a fact-intensive inquiry made annually that depends, in part, upon the composition and classification of our income
+and assets. Fluctuations in the market price of our shares may cause us to be or become a PFIC for the current or subsequent taxable years
+because the value of our assets for the purpose of the asset test, including the value of our goodwill and other unbooked intangibles,
+may be determined by reference to the market price of our shares (which may be volatile). The composition of our income and assets may
+also be affected by how, and how quickly, we use our liquid assets and the cash raised in this offering. It is also possible that the
+Internal Revenue Service may challenge our classification of certain income or assets for purposes of the analysis set forth in subparagraphs
+(a) and (b), above or the valuation of our goodwill and other unbooked intangibles, which may result in our Company being or becoming
+a PFIC for the current or future taxable years.
+
+ 
+
+If we are classified as a PFIC
+for any taxable year during which a U.S. Holder holds our shares, and unless the U.S. Holder makes a mark-to-market election (as described
+below), the U.S. Holder will generally be subject to special tax rules on (i) any excess distribution that we make to the U.S. Holder
+(which generally means any distribution paid during a taxable year to a U.S. Holder that is greater than 125% of the average annual distributions
+paid in the three preceding taxable years or, if shorter, the U.S. Holder s holding period for the shares), and (ii) any gain realized
+on the sale or other disposition, including, under certain circumstances, a pledge, of shares. Under the PFIC rules:
+
+ 
+
+ 
+ 
+ 
+ such excess distribution and/or gain will be allocated ratably over the U.S. Holder s holding period for the shares;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ such amount allocated to the current taxable year and any taxable years in the U.S. Holder s holding period prior to the first taxable year in which we are a PFIC, each a pre-PFIC year, will be taxable as ordinary income;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ such amount allocated to each prior taxable year, other than a pre-PFIC year, will be subject to tax at the highest tax rate in effect applicable to the U.S. Holder for that year; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an interest charge generally applicable to underpayments of tax will be imposed on the tax attributable to each prior taxable year, other than a pre-PFIC year.
+
+ 
+ 
+
+ 115
+
+ 
+
+ 
+
+ 
+
+If we are a PFIC for any taxable
+year during which a U.S. Holder holds our shares and we own any equity in a non-United States entity that is also a PFIC, or a lower-tier
+PFIC, such U.S. Holder would be treated as owning a proportionate amount (by value) of the shares of the lower-tier PFIC for purposes
+of the application of these rules. U.S. Holders are advised to consult their tax advisors regarding the application of the PFIC rules
+to any of the entities in which we may own equity.
+
+ 
+
+As an alternative to the foregoing
+rules, a U.S. Holder of "marketable stock" in a PFIC may make a mark-to-market election with respect to such stock, provided
+that certain requirements are met. The mark-to-market election is available only for stock that is regularly traded on a national securities
+exchange that is registered with the SEC, or on a foreign exchange or market that the IRS determines is a qualified exchange that has
+rules sufficient to ensure that the market price represents a legitimate and sound fair market value. Although we intend to apply for
+the listing of our shares on the Nasdaq, we cannot guarantee that our listing will be approved. Furthermore, we cannot guarantee that,
+once listed, our shares will continue to be listed and regularly traded on such exchange. U.S. Holders are advised to consult their tax
+advisors as to whether the shares are considered marketable for these purposes.
+
+ 
+
+If an effective mark-to-market
+election is made with respect to our shares, the U.S. Holder will generally (i) include as ordinary income for each taxable year that
+we are a PFIC the excess, if any, of the fair market value of shares held at the end of the taxable year over its adjusted tax basis of
+such shares and (ii) deduct as an ordinary loss the excess, if any, of its adjusted tax basis of the shares held at the end of the taxable
+year over the fair market value of such shares held at the end of the taxable year, but only to the extent of the net amount previously
+included in income as a result of the mark-to-market election. The U.S. Holder s adjusted tax basis in the shares would be adjusted
+to reflect any income or loss resulting from the mark-to-market election. If a U.S. Holder makes an effective mark-to-market election,
+in each year that we are a PFIC any gain recognized upon the sale or other disposition of the shares will be treated as ordinary income
+and loss will be treated as ordinary loss, but only to the extent of the net amount previously included in income as a result of the mark-to-market
+election.
+
+ 
+
+If a U.S. Holder makes a mark-to-market
+election in respect of a PFIC and such corporation ceases to be a PFIC, the U.S. Holder will not be required to take into account the
+mark-to-market gain or loss described above during any period that such corporation is not a PFIC.
+
+ 
+
+Because a mark-to-market election
+generally cannot be made for any lower-tier PFICs that a PFIC may own, a U.S. Holder who makes a mark-to-market election with respect
+to our shares may continue to be subject to the general PFIC rules with respect to such U.S. Holder s indirect interest in any of
+our non-United States subsidiaries if any of them is a PFIC.
+
+ 
+
+If a U.S. Holder owns our shares
+during any taxable year that we are a PFIC, such holder would generally be required to file an annual IRS Form 8621. Each U.S. Holder
+is advised to consult its tax advisor regarding the potential tax consequences to such holder if we are or become a PFIC, including the
+possibility of making a mark-to-market election.
+
+ 
+
+Hong Kong Tax Considerations
+
+ 
+
+Profits Tax
+
+ 
+
+No tax is imposed in Hong Kong
+in respect of capital gains from the sale of capital assets, such as our Ordinary Shares. Hence, there is no withholding tax on capital
+gains from sale of our Ordinary Shares. However, revenue gains from the sale of assets by persons carrying on a trade, profession or business
+in Hong Kong where such gains are derived from or arise in Hong Kong from such trade, profession or business will be chargeable to Hong
+Kong profits tax which is levied on a two-tiered profits tax rate basis, with the first HK$2 million of assessable profits being taxed
+at 8.25% for corporations and 7.5% for unincorporated businesses, and assessable profits exceeding the first HK$2 million being taxed
+at 16.5% for corporations and 15% for unincorporated businesses from the year of assessment commencing on or after April 1, 2018. There
+is no bilateral tax treaty between Hong Kong and the United States.
+
+ 
+
+Dividends
+
+ 
+
+Hong Kong does not impose tax
+on dividends. Furthermore, dividends received from foreign companies are not taxable as they are foreign-source income. Hence, there is
+no withholding tax on dividends received in respect of our Ordinary Shares unless such dividends are attributable to a trade, profession
+or business carried on in Hong Kong.
+
+ 
+
+Stamp Duty
+
+ 
+
+Hong Kong stamp duty is generally
+payable on the transfer of "Hong Kong stock." The term "stocks" refers to stock in companies incorporated in Hong
+Kong, as widely defined under the Stamp Duty Ordinance (Cap. 117 of the laws of Hong Kong), or SDO, and includes shares. However, our
+Ordinary Shares are not considered "Hong Kong stocks" under the SDO since the transfer of the Ordinary Shares are not required
+to be registered in Hong Kong given that the books for the transfer of Ordinary Shares are located in the United States. The transfer
+of Ordinary Shares is therefore not subject to stamp duty in Hong Kong.
+
+ 
+
+THE DISCUSSION ABOVE IS A GENERAL
+SUMMARY. IT DOES NOT COVER ALL TAX MATTERS THAT MAY BE OF IMPORTANCE TO A PARTICULAR INVESTOR. EACH PROSPECTIVE INVESTOR IN THE OUR SHARES
+IS URGED TO CONSULT ITS OWN TAX ADVISER ABOUT THE TAX CONSEQUENCES TO IT OF OWNING AND DISPOSING OF OUR SHARES IN LIGHT OF SUCH PROSPECTIVE
+INVESTOR S OWN CIRCUMSTANCES.
+
+ 
+
+ 116
+
+ 
+
+ 
+
+ 
+
+UNDERWRITING
+
+ 
+
+We and the Selling Shareholders
+have entered into an underwriting agreement dated [ ], with Joseph Stone Capital, LLC, or the Representative, acting as the lead
+managing underwriter and book-runner with respect to the shares subject to this offering. Subject to the terms and conditions of the
+underwriting agreement, we and the Selling Shareholders have agreed to sell to the underwriter, and the underwriter has agreed
+to purchase, on a firm commitment basis, the number of shares set forth opposite its name below, at the public offering price,
+less the underwriting discount set forth on the cover page of this prospectus:
+
+ 
+
+ 
+ Name
+ 
+ 
+ Number of
+
+ shares
+
+ 
+
+ 
+ Joseph Stone Capital, LLC
+ 
+ 
+ [ ]
+ 
+
+ 
+ Total
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+The underwriter is offering the
+shares subject to their acceptance of the shares from us and the Selling Shareholders and subject to prior sale. The underwriting
+agreement provides that the obligations of the underwriter to pay for and accept delivery of the shares offered by this prospectus are
+subject to the approval of certain legal matters by their counsel and to certain other conditions. The underwriter is obligated to take
+and pay for all of the shares offered by this prospectus if any such shares are taken.
+
+ 
+
+The Representative has advised
+us that it proposes to offer the shares to the public at the public offering price set forth on the cover page of this prospectus and
+to certain dealers at that price less a concession not in excess of US$[ ] per share. The underwriter may allow, and certain dealers
+may re-allow, a discount from the concession not in excess of US$[ ] per share to certain brokers and dealers. After this offering,
+the public offering price, concession and reallowance to dealers may be reduced by the Representative. No such reduction shall change
+the amount of proceeds to be received by us as set forth on the cover page of this prospectus. The securities are offered by the underwriter
+as stated herein, subject to receipt and acceptance by them and subject to their right to reject any order in whole or in part. The underwriter
+has informed us that they do not intend to confirm sales to any accounts over which they exercise discretionary authority.
+
+ 
+
+Discounts, Commission and Expenses
+
+ 
+
+The underwriting discounts are
+7.5% of the initial public offering price.
+
+ 
+
+The following table shows the
+price per share and total public offering price, underwriting discounts and commissions, and proceeds before expenses to us.
+
+ 
+
+ 
+ 
+ 
+ Total
+ 
+
+ 
+ 
+ 
+ Per Share
+ 
+
+ 
+ Public offering price
+ 
+ US$
+ [ ]
+ 
+
+ 
+ Underwriting discounts and commissions to be paid by us:
+ 
+ US$
+ [ ]
+ 
+
+ 
+ Proceeds, before expenses, to us
+ 
+ US$
+ [ ]
+ 
+
+ 
+ 
+
+We will also pay to the Representative
+by deduction from the net proceeds of the offering contemplated herein, a non-accountable expense allowance equal to one and a half percent
+(1.5%) of the gross proceeds received by us from the sale of the shares.
+
+ 
+
+Additionally, the Company paid
+a $45,000 advisory fee upon execution of the engagement letter with the Representative and shall pay an additional $40,000 to the Representative
+upon public filing of this registration statement.
+
+ 
+
+We have agreed to reimburse the
+Representative up to a maximum of US$180,000 for out-of-pocket accountable expenses (including the legal fees and other disbursements
+as disclosed below).
+
+ 
+
+ 117
+
+ 
+
+ 
+
+ 
+
+The Company will be responsible
+for and pay all expenses relating to the Offering, including, without limitation, (a) all filing fees and communication expenses relating
+to the registration of the Shares to be sold in the Offering (including the Over-allotment Shares) with the Commission; (b) all corporate
+finance department filing fees associated with the review of the Offering by FINRA; all fees and expenses relating to the listing of
+such Shares on the Nasdaq Capital Market, the Nasdaq National Market or the NYSE American US and on such other stock exchanges as the
+Company and JSC together determine; (c) all fees, expenses and disbursements relating to background checks of the Company s officers
+and directors; (d) all fees, expenses and disbursements relating to the registration, qualification or exemption of such Shares under
+the securities laws of such foreign jurisdictions as JSC may reasonably designate; (e) the costs of all mailing and printing of the underwriting
+documents (including, without limitation, the Underwriting Agreement, any Blue Sky Surveys and, if appropriate, any Agreement Among Underwriters,
+Selected Dealers Agreement, Underwriters Questionnaire and Power of Attorney), Registration Statements, Prospectuses and
+all amendments, supplements and exhibits thereto and as many preliminary and final Prospectuses as JSC may reasonably deem necessary;
+(f) the costs and expenses of the public relations firm referred to in Paragraph 12(h) hereof; (g) the costs of preparing, printing and
+delivering certificates representing the Shares; (h) fees and expenses of the transfer agent for the Shares; (i) stock transfer and/or
+stamp taxes, if any, payable upon the transfer of securities from the Company to JSC; (j) the costs associated with post-Closing advertising
+the Offering in the national editions of the Wall Street Journal and New York Times; (k) the costs associated with bound volumes of the
+public offering materials as well as commemorative mementos and lucite tombstones, each of which the Company or its designee will provide
+within a reasonable time after the Closing in such quantities as JSC may reasonably request; (I) the fees and expenses of the Company s
+accountants; (m) the fees and expenses of the Company s legal counsel and other agents and representatives;(n) translation cost
+for due diligence purposes, the reasonable cost for roadshow meetings and the preparation of a power point presentation; ( o) up to $180,000
+to cover JSC s accountable expenses for the Offering, including reasonable, out-of-pocket expenses (including, but not limited
+to, travel, communication, due diligence, and legal counsel fees and expenses etc.) in connection with the performance of its services
+hereunder, regardless of whether a Transaction occurs (the "Accountable Expenses").
+
+ 
+
+We estimate that the total expenses
+of the offering payable by us, excluding the underwriter discount and commissions and non-accountable expense allowance will be
+approximately US$1,500,000 including a maximum aggregate reimbursement of US$180,000 of the Representative s accountable expenses.
+
+ 
+
+Lock-Up Agreements
+
+ 
+
+Our Executive Officers and Directors
+have agreed to a 12 month "lock-up" period from the closing of this offering with respect to the shares that they beneficially
+own, including the issuance of shares upon the exercise of convertible securities and options that are currently outstanding or which
+may be issued. Our 5% or more shareholders have agreed to 6 a month lock-up period. This means that, for a period of 12 months or 6 months,
+as the case may be, following the closing of the offering, such persons may not offer, sell, pledge or otherwise dispose of these securities
+without the prior written consent of the Representative.
+
+ 
+
+The Representative has no present
+intention to waive or shorten the lock-up period; however, the terms of the lock-up agreements may be waived at its discretion. In determining
+whether to waive the terms of the lock-up agreements, the Representative may base its decision on its assessment of the relative strengths
+of the securities markets and companies similar to ours in general, and the trading pattern of, and demand for, our securities in general.
+
+ 
+
+Tail Fee
+
+ 
+
+We
+have also agreed to pay the Representative a cash fee equal to seven and a half percent (7.5%) of the gross proceeds received by
+the Company ("Tail Fee") in a transaction or series of transactions in which the Representative did not act as at least exclusive
+lead US underwriter or placement agent (each of such transactions, a "Tail Financing") in which the Company s
+securities are sold by the Company or any of its affiliates to an investor which the Representative contacted or introduced to
+the Company during the Engagement Period (as defined below), provided that such Tail Financing is consummated within 12 months after the
+Engagement Period. In compliance with FINRA Rule 5110(g)(5)(B), the Tail Fee will be terminated upon the Company s termination of
+the Underwriting Agreement for cause, in which case the Company will not be responsible for paying for the Tail Fee unless a Tail Financing
+is consummated within the Engagement Period.
+
+ 
+
+"Engagement Period"
+means the period beginning on July 25, 2024 and terminable after December 30, 2025, after which either Company or the Representative have
+the right to terminate the engagement upon 30 days prior written notice.
+
+ 
+
+Nasdaq
+
+ 
+
+We will apply to have our shares
+approved for listing on the Nasdaq under the symbol "MEON." We make no representation that such application will be approved
+or that our shares will trade on such market either now or at any time in the future; notwithstanding the foregoing, we will not close
+this offering unless such shares will be listed on the Nasdaq at the completion of this offering.
+
+ 
+
+ 118
+
+ 
+
+ 
+
+ 
+
+Electronic Distribution
+
+ 
+
+A prospectus in electronic format
+may be made available on websites or through other online services maintained by Representative or by its affiliates. Other than the prospectus
+in electronic format, the information on the Representative s website and any information contained in any other website maintained
+by it is not part of this prospectus or the registration statement of which this prospectus forms a part, has not been approved and/or
+endorsed by us or the Representative in its capacity as an underwriter, and should not be relied upon by investors.
+
+ 
+
+Any underwriter who is a qualified
+market maker on the Nasdaq may engage in passive market making transactions on the Nasdaq in accordance with Rule 103 of Regulation M,
+during the Business Day prior to the pricing of the offering, before the commencement of offers or sales. Passive market makers must comply
+with applicable volume and price limitations and must be identified as passive market makers. In general, a passive market maker must
+display its bid at a price not in excess of the highest independent bid for such security; if all independent bids are lowered below the
+passive market maker s bid, however, the passive market maker s bid must then be lowered when certain purchase limits are
+exceeded.
+
+ 
+
+No Prior Public Market
+
+ 
+
+Prior to this offering, there
+has been no public market for our securities and the public offering price for our shares will be determined through negotiations between
+us and the Representative. Among the factors to be considered in these negotiations will be prevailing market conditions, our financial
+information, market valuations of other companies that we and the Representative believe to be comparable to us, estimates of our business
+potential, the present state of our development and other factors deemed relevant. The offering price for our shares in this offering
+has been arbitrarily determined by our Company in its negotiations with the underwriter and does not necessarily bear any direct relationship
+to the assets, operations, book or other established criteria of value of our Company.
+
+ 
+
+Price Stabilization, Short Positions and Penalty
+Bids
+
+ 
+
+Until the distribution of the
+shares offered by this prospectus is completed, rules of the SEC may limit the ability of the underwriter to bid for and to purchase our
+shares. As an exception to these rules, the underwriter may engage in transactions effected in accordance with Regulation M under the
+Exchange Act that are intended to stabilize, maintain or otherwise affect the price of our shares. The underwriter may engage in over-allotment
+sales, syndicate covering transactions, stabilizing transactions and penalty bids in accordance with Regulation M.
+
+ 
+
+ Stabilizing transactions
+consist of bids or purchases made by the managing underwriter for the purpose of preventing or slowing a decline in the market price of
+our securities while this offering is in progress.
+
+ 
+
+ Short sales and over-allotments
+occur when the managing underwriter, on behalf of the underwriting syndicate, sells more of our shares than they purchase from us in this
+offering. In order to cover the resulting short position, the managing underwriter may exercise the overallotment option described above
+and/or may engage in syndicate covering transactions. There is no contractual limit on the size of any syndicate covering transaction.
+The underwriter will deliver a prospectus in connection with any such short sales. Purchasers of shares sold short by the underwriter
+are entitled to the same remedies under the federal securities laws as any other purchaser of units covered by the registration statement.
+
+ 
+
+ Syndicate covering transactions
+are bids for or purchases of our securities on the open market by the managing underwriter on behalf of the underwriter in order to reduce
+a short position incurred by the managing underwriter on behalf of the underwriter.
+
+ 
+
+ A penalty bid is an arrangement
+permitting the managing underwriter to reclaim the selling concession that would otherwise accrue to an underwriter if the shares originally
+sold by the underwriter were later repurchased by the managing underwriter and therefore was not effectively sold to the public by such
+underwriter.
+
+ 
+
+Stabilization, syndicate covering
+transactions and penalty bids may have the effect of raising or maintaining the market price of our shares or preventing or retarding
+a decline in the market price of our shares. As a result, the price of our shares may be higher than the price that might otherwise exist
+in the open market.
+
+ 
+
+Neither we nor the underwriter
+make any representation or prediction as to the effect that the transactions described above may have on the prices of our shares. These
+transactions may occur on the Nasdaq. If any of these transactions are commenced, they may be discontinued without notice at any time.
+
+ 
+
+Other Relationships
+
+ 
+
+The underwriter and certain of
+their affiliates are full service financial institutions engaged in various activities, which may include securities trading, commercial
+and investment banking, financial advisory, investment management, investment research, principal investment, hedging, financing and brokerage
+activities. Some of the underwriter and certain of their affiliates may in the future engage in investment banking and other commercial
+dealings in the ordinary course of business with us and our affiliates, for which they may in the future receive customary fees, commissions
+and expenses. In addition, in the ordinary course of their business activities, the underwriter and their affiliates may make or hold
+a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments
+(including bank borrowings) for their own account and for the accounts of their customers. Such investments and securities activities
+may involve securities and/or instruments of ours or our affiliates. The underwriter and their affiliates may also make investment recommendations
+and/or publish or express independent research views in respect of such securities or financial instruments and may hold, or recommend
+to clients that they acquire, long and/or short positions in such securities and instruments.
+
+ 
+
+Offers outside the United States
+
+ 
+
+Other than in the United States,
+no action has been taken by us or the underwriter that would permit a public offering of the shares offered by this prospectus in any
+jurisdiction where action for that purpose is required. The shares offered by this prospectus may not be offered or sold, directly or
+indirectly, nor may this prospectus or any other offering material or advertisements in connection with the offer and sale of any such
+shares be distributed or published in any jurisdiction, except under circumstances that will result in compliance with the applicable
+rules and regulations of that jurisdiction. Persons into whose possession this prospectus comes are advised to inform themselves about
+and to observe any restrictions relating to the offering and the distribution of this prospectus. This prospectus does not constitute
+an offer to sell or a solicitation of an offer to buy any shares offered by this prospectus in any jurisdiction in which such an offer
+or a solicitation is unlawful.
+
+ 
+
+ 119
+
+ 
+
+ 
+
+ 
+
+LEGAL MATTERS
+
+ 
+
+The validity of the shares offered
+in this offering and certain legal matters as to Cayman Islands law will be passed upon for us by Harney Westwood & Riegels.
+
+ 
+
+We are being represented by Schlueter
+& Associates with respect to certain legal matters of U.S. federal securities.
+
+ 
+
+We are being represented by Cheung,
+Yeung & Lee, Solicitors with respect to certain legal matters of Hong Kong law.
+
+ 
+
+We are being represented by The
+Alpha Law Firm with respect to certain legal matters of China law.
+
+ 
+
+Certain legal matters of United
+States federal securities laws in connection with this offering will be passed upon for the underwriter by Sichenzia Ross Ference Carmel
+LLP.
+
+ 
+
+ 120
+
+ 
+
+ 
+
+ 
+
+EXPERTS
+
+ 
+
+The financial statements as of
+September 30, 2024 and 2023, and for each of the two years in the period ended September 30, 2024 included in this prospectus
+have been audited by TAAD LLP, an independent registered public accounting firm, as stated in their report appearing herein. Such financial
+statements have been so included in reliance upon the report of such firm given upon the authority of such firm as experts in accounting
+and auditing. The office of TAAD LLP is located at 20955 Pathfinder Road, Suite 370, Diamond Bar, CA 91765.
+
+ 
+
+ 121
+
+ 
+
+ 
+
+ 
+
+WHERE YOU CAN FIND MORE INFORMATION
+
+ 
+
+We have filed a registration statement,
+including relevant exhibits, with the SEC on Form F-1 under the Securities Act with respect to the underlying shares to be sold in this
+offering. For the purposes of this section, the term "registration statement" means the original registration statement and
+any and all amendments thereto including the schedules and exhibits to the original registration statement or any amendment. This prospectus,
+which constitutes a part of the registration statement on Form F-1, does not contain all of the information contained in the registration
+statement. You should read our registration statements and their exhibits and schedules for further information with respect to us and
+our shares.
+
+ 
+
+Immediately upon the effectiveness
+of the registration statement on Form F-1 of which this prospectus forms a part, we will become subject to periodic reporting and other
+informational requirements of the Exchange Act as applicable to foreign private issuers. Accordingly, we will be required to file reports,
+including annual reports on Form 20-F, and other information with the SEC. All information filed with the SEC, including the registration
+statement, can be obtained over the Internet at the SEC s website at www.sec.gov or inspected and copied at the public reference
+facilities maintained by the SEC at 100 F Street, N.E., Washington, D.C. 20549. You can request copies of documents, upon payment of a
+duplicating fee, by writing to the SEC.
+
+ 
+
+As a foreign private issuer, we
+are exempt under the Exchange Act from, among other things, the rules prescribing the furnishing and content of proxy statements, and
+our Executive Officers, Directors and principal shareholders are exempt from the reporting and short-swing profit recovery provisions
+contained in Section 16 of the Exchange Act. In addition, we will not be required under the Exchange Act to file periodic reports and
+financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are registered under the Exchange Act.
+As we are a foreign private issuer, we will be required to file our annual report on Form 20-F within 120 days of the end of each year.
+However, we intend to furnish the depositary with our annual reports, which will include a review of operations and annual audited consolidated
+financial statements prepared in conformity with U.S. GAAP, and all notices of shareholders meetings and other reports and communications
+that are made generally available to our shareholders.
+
+ 
+
+ 122
+
+ 
+
+ 
+
+ 
+
+PART II
+
+ 
+
+INFORMATION NOT REQUIRED IN PROSPECTUS
+
+ 
+
+ITEM 6. INDEMNIFICATION OF
+DIRECTORS AND EXECUTIVE OFFICERS
+
+ 
+
+Cayman Islands laws do
+not prohibit or restrict a company from indemnifying its directors and officers against personal liability for any loss they may incur
+arising out of our Company s business, except to the extent such provision may be held by the Cayman Islands courts to be contrary
+to public policy, such as to provide indemnification against civil fraud or the consequences of committing a crime. The indemnity extends
+only to liability for their own negligence and breach of duty other than breaches of fiduciary duty and not where there is evidence of
+dishonesty, willful default or fraud.
+
+ 
+
+Our Amended Memorandum and Articles
+of Association permits, to the fullest extent permissible under Cayman Islands law, indemnification of our Executive Officers and Directors
+against all actions, proceedings, costs, charges, expenses, losses, damages or liabilities incurred or sustained by them, other than by
+reason of their own dishonesty, willful default or fraud, in connection with the execution or discharge of their duties, powers, authorities
+or discretion as Directors or Executive Officers of our Company, including without prejudice to the generality of the foregoing, any costs,
+expenses, losses or liabilities incurred by them in defending (whether successfully or otherwise) any civil proceedings concerning our
+Company or its affairs in any court whether in the Cayman Islands or elsewhere.
+
+ 
+
+We intend to enter into indemnification
+agreements with each of our Directors and Executive Officers. These agreements will require us to indemnify these individuals to the fullest
+extent permitted under Cayman Islands law against liabilities that may arise by reason of their service to us, and to advance expenses
+incurred as a result of any proceeding against them as to which they could be indemnified, subject to our Company reserving its rights
+to recover the full amount of such advances in the event that he or she is subsequently found to have been negligent or otherwise have
+breached his or her trust or fiduciary duties to our Company or to be in default thereof, or where the Cayman Islands courts have declined
+to grant relief.
+
+ 
+
+The form of underwriting agreement
+to be filed as Exhibit 1.1 to this registration statement will also provide for indemnification of us and our Executive Officers and Directors.
+
+ 
+
+Insofar as indemnification for
+liabilities arising under the Securities Act may be permitted to Directors, Executive Officers or persons controlling us pursuant to the
+foregoing provisions, we have been informed that in the opinion of the SEC such indemnification is against public policy as expressed
+in the Securities Act and is therefore unenforceable.
+
+ 
+
+ITEM 7. RECENT SALES OF UNREGISTERED
+SECURITIES
+
+ 
+
+During the past three years, we
+have issued and sold the following securities without registering such securities under the Securities Act. We believe that each of the
+following issuances was exempt from registration under the Securities Act pursuant to Section 4(a)(2) of the Securities Act regarding
+transactions not involving a public offering or in reliance on Regulation S under the Securities Act regarding sales by an issuer in offshore
+transactions. No underwriter were involved in these issuances of securities.
+
+ 
+
+Shares
+
+ 
+
+ 
+ Allottee 
+ 
+ Date of Sale or Issuance 
+ 
+ Number
+ of Securities (After the Reverse Stock Split)*
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Tech Vision Investments Limited
+ 
+ July 29, 2024 
+ 
+ 16,500,000 Class B Ordinary
+ Shares
+
+ 
+ Rich Choice Ventures Limited
+ 
+ July 29, 2024
+ 
+ 1,000,000 Class A Ordinary
+ Shares
+
+ 
+ Meta World Group Limited
+ 
+ July 29, 2024
+ 
+ 1,000,000 Class A Ordinary
+ Shares
+
+ 
+ Distinctive Idea Enterprises Limited
+ 
+ July 29, 2024
+ 
+ 600,000 Class A Ordinary
+ Shares
+
+ 
+ Magic Summit Ventures Limited
+ 
+ July 29, 2024
+ 
+ 900,000 Class A Ordinary
+ Shares
+
+ 
+ 
+
+*On September 1, 2025, the
+Company effected a reverse stock split (the" Reverse Stock Split") of the Company s issued and outstanding Ordinary
+Shares at a split ratio of 1-for-2 such that every holder of Class A and Class B Ordinary Shares shall receive one share for every two
+shares of Ordinary shares held. All references to number of shares have been retroactively adjusted.
+
+ 
+
+ II-1
+
+ 
+
+ 
+
+ 
+
+ITEM 8. EXHIBITS AND FINANCIAL
+STATEMENT SCHEDULES
+
+ 
+
+ 
+ 
+ (a)
+ Exhibits
+
+ 
+ 
+
+See "Exhibit Index"
+beginning on page II-4 of this registration statement.
+
+ 
+
+ 
+ 
+ (b)
+ Financial Statement Schedules
+
+ 
+ 
+
+All supplement schedules are omitted
+because of the absence of conditions under which they are required or because the data is shown in the financial statements or notes thereto.
+
+ 
+
+ITEM 9. UNDERTAKINGS
+
+ 
+
+(a) The undersigned Registrant
+hereby undertakes:
+
+ 
+
+1. To file, during any period
+in which offers or sales are being made, a post-effective amendment to this registration statement, unless the information required to
+be included in a post-effective amendment by paragraphs (i), (ii) and (iii) below is contained in reports filed with or furnished to the
+SEC by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference
+in the registration statement, or is contained in a form of a prospectus filed pursuant to Rule 424(b) that is part of the registration
+statement:
+
+ 
+
+(i) To include any prospectus
+required by Section 10(a)(3) of the Securities Act of 1933, as amended;
+
+ 
+
+(ii) To reflect in the prospectus
+any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof)
+which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding
+the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed
+that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the
+form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more
+than a 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table
+in the effective registration statement; and
+
+ 
+
+(iii) To include any material
+information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to
+such information in the registration statement.
+
+ 
+
+2. That, for the purpose of determining
+any liability under the Securities Act of 1933, as amended, each such post-effective amendment shall be deemed to be a new registration
+statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial
+bona fide offering thereof.
+
+ 
+
+3. To remove from registration
+by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
+
+ 
+
+4. To file a post-effective amendment
+to the registration statement to include any financial statements required by Item 8.A. of Form 20-F at the start of any delayed offering
+or throughout a continuous offering. Financial statements and information otherwise required by Section 10(a)(3) of the Securities Act
+of 1933, as amended, need not be furnished, provided, that the registrant includes in the prospectus, by means of a post-effective amendment,
+financial statements required pursuant to this paragraph (a)(4) and other information necessary to ensure that all other information in
+the prospectus is at least as current as the date of those financial statements.
+
+ 
+
+ II-2
+
+ 
+
+ 
+
+ 
+
+5. That, for the purpose of determining
+liability under the Securities Act of 1933, as amended, to any purchaser.
+
+ 
+
+(i) Each prospectus filed by the
+registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was
+deemed part of and included in the registration statement; and
+
+ 
+
+(ii) Each prospectus required
+to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an
+offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the
+Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form
+of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the
+prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date
+shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which
+that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
+Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made
+in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration
+statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that
+was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately
+prior to such effective date.
+
+ 
+
+6. That, for the purpose of determining
+liability of a registrant under the Securities Act of 1933, as amended, to any purchaser in the initial distribution of the securities,
+the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration
+statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to
+such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will
+be considered to offer or sell such securities to such purchaser:
+
+ 
+
+(i) Any preliminary prospectus
+or prospectus of an undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
+
+ 
+
+(ii) Any free writing prospectus
+relating to the offering prepared by or on behalf of an undersigned registrant or used or referred to by an undersigned registrant;
+
+ 
+
+(iii) The portion of any other
+free writing prospectus relating to the offering containing material information about an undersigned registrant or its securities provided
+by or on behalf of an undersigned registrant; and
+
+ 
+
+(iv) Any other communication that
+is an offer in the offering made by an undersigned registrant to the purchaser.
+
+ 
+
+7. Insofar as indemnification
+for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant
+pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange
+Commission such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable.
+In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred
+or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is
+asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless
+in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the
+question whether such indemnification by it is against public policy as expressed in the Securities Act of 1933 and will be governed by
+the final adjudication of such issue.
+
+ 
+
+ II-3
+
+ 
+
+ 
+
+ 
+
+EXHIBIT INDEX
+
+ 
+
+ 
+ Exhibit No.
+ 
+ Description of document
+
+ 
+ 1.1**
+ 
+ Form of Underwriting Agreement 
+
+ 
+ 3.1*** 
+ 
+ Amended and Restated Memorandum of Association and Form of Amended and Restated Articles of Association of the Registrant effected on September 1, 2025)
+
+ 
+ 5.1**
+ 
+ Form of Opinion of Harney Westwood & Riegels regarding the validity of securities being registered
+
+ 
+ 5.2**
+ 
+ Form of Opinion of Cheung, Yeung & Lee, Solicitors regarding Hong Kong legal matters
+
+ 
+ 5.3**
+ 
+ Form of Opinion of The Alpha Law Firm regarding the PRC legal matters
+
+ 
+ 8.1**
+ 
+ Form of Opinion of Harney Westwood & Riegels regarding certain Cayman Islands tax matters (included in Exhibit 5.1)
+
+ 
+ 10.1*** 
+ 
+ Livi Bank Limited and Mediaon Limited Banking Facilities Letter dated August 23, 2023
+
+ 
+ 10.2*** 
+ 
+ Hang Seng Bank and Mediaon Limited Banking Facilities Letter dated June 18, 2021
+
+ 
+ 10.3*** 
+ 
+ Hang Seng Bank and Mediaon Limited Banking Facilities Letter dated December 23, 2020
+
+ 
+ 10.4*** 
+ 
+ Form of Directors Agreement
+
+ 
+ 10.5***+ 
+ 
+ Tabolla (Hong Kong) Ltd. Trading Terms dated January 23, 2024
+
+ 
+ 10.6***+ 
+ 
+ Partnership Agreement between uMax Data Technology Limited and MediaOn Limited dated January 2, 2025
+
+ 
+ 10.7***+ 
+ 
+ The Gold Reseller Agreement between Yahoo! Hong Kong Limited and Medion Limited dated December 21, 2023
+
+ 
+ 14*** 
+ 
+ Form of Code of Ethics of the Registrant
+
+ 
+ 21.1*** 
+ 
+ Form of List of Subsidiaries of the Registrant
+
+ 
+ 23.1*
+ 
+ Form of Consent of TAAD LLP
+
+ 
+ 23.2**
+ 
+ Form of Consent of Harney Westwood & Riegels (included in Exhibit 5.1)
+
+ 
+ 23.3**
+ 
+ Form of Consent of Cheung, Yeung & Lee, Solicitors (included in Exhibit 5.2) 
+
+ 
+ 23.4*** 
+ 
+ Consent from Frost & Sullivan
+
+ 
+ 24.1*
+ 
+ Power of Attorney (included on signature pages)
+
+ 
+ 99.1*** 
+ 
+ Consent of Francis Po Kiu Fong to be a director nominee
+
+ 
+ 99.2*** 
+ 
+ Consent of Willde Nang Fong Ng to be a director nominee
+
+ 
+ 99.3*** 
+ 
+ Consent of Annet Yan Yee Kung to be a director nominee
+
+ 
+ 99.4*** 
+ 
+ Consent of Hoi Fat Tse to be a director nominee
+
+ 
+ 107*** 
+ 
+ Registration Fee Table
+
+ 
+ 
+
+* Submitted herewith
+
+** To be filed by amendment
+
+ *** Previously filed 
+
++
+Confidential treatment requested pursuant to Rules 406 of the Securities Act and Rule 24B-2 of the Exchange Act.
+
+ 
+
+ II-4
+
+ 
+
+ 
+
+ 
+
+SIGNATURES
+
+ 
+
+Pursuant to the requirements
+of the Securities Act, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing
+on Form F-1 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized,
+in Hong Kong, on December 3, 2025.
+
+ 
+
+ 
+ 
+ MEDIAON GROUP INC.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ By:
+ /s/ Jerry Chi Wai Chan
+
+ 
+ 
+ Name: 
+ Jerry Chi Wai Chan
+
+ 
+ 
+ Title: 
+ Executive Director and Chief Executive Officer
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ By: 
+ /s/ Jimmy Shu Wai Chan
+
+ 
+ 
+ Name: 
+ Jimmy Shu Wai Chan 
+
+ 
+ 
+ Title: 
+ Executive Director and Chief Financial Officer
+
+ 
+ 
+
+POWER OF ATTORNEY
+
+ 
+
+We, the undersigned Directors
+and Executive Officers of MEDIAON GROUP INC. and its subsidiaries hereby severally constitute and appoint Jerry Chi Wai Chan, singly (with
+full power to act alone), our true and lawful attorney-in-fact and agent with full power of substitution and resubstitution in him for
+him and in his name, place and stead, and in any and all capacities, to sign this Registration Statement on Form F-1 and any and all amendments
+(including post-effective amendments) to this Registration Statement (or any other Registration Statement for the same offering that is
+to be effective upon filing pursuant to Rule 462(b) under the Securities Act), and to file the same, with all exhibits thereto and other
+documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent, and him,
+full power and authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as
+full to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and
+agent or his substitute or substitutes may lawfully do or cause to be done by virtue hereof.
+
+ 
+
+Pursuant to the requirements of
+the Securities Act, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
+
+ 
+
+ 
+ Signature
+ 
+ Title
+ 
+ Date
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ /s/ Jerry Chi Wai Chan
+ 
+ Executive Director and Chief Executive Officer
+ 
+ December 3, 2025
+
+ 
+ Jerry Chi Wai Chan
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ /s/ Jimmy Shui Wai Chan
+ 
+ Executive Director and Chief Financial Officer
+ 
+ December 3, 2025
+
+ 
+ Jimmy Shui Wai Chan
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ /s/ Rico Kai To Chan
+ 
+ Executive Director
+ 
+ December 3, 2025
+
+ 
+ Rico Kai To Chan
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+SIGNATURE OF AUTHORIZED REPRESENTATIVE OF THE REGISTRANT
+
+ 
+
+Pursuant to the Securities Act, the undersigned, the
+duly authorized representative in the United States of America, has signed this registration statement or amendment thereto in the City
+of Newark, Delaware United States of America on December 3, 2025.
+
+ 
+
+ 
+ 
+ Puglisi & Associates
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ By: 
+ /s/ Donald J. Puglisi
+
+ 
+ 
+ Name:
+ Donald J. Puglisi 
+
+ 
+ 
+ Title: 
+ Managing Director
+
+ 
+ 
+
+ II-5
+
+ 
+
+ 
+
+ 
+
+MEDIAON
+GROUP INC.
+
+INDEX
+TO CONSOLIDATED FINANCIAL STATEMENTS
+
+ 
+
+TABLE
+OF CONTENTS
+
+ 
+
+ 
+ 
+ Page
+
+ 
+ Consolidated Balance Sheets as of March 31, 2025 (Unaudited) and September
+30, 2024
+ F-2
+
+ 
+ 
+ 
+
+ 
+ Consolidated Statements of Operations and Comprehensive Income (Loss) for
+the Six Months Ended March 31, 2025 and 2024 (Unaudited)
+ F-3
+
+ 
+ 
+ 
+
+ 
+ Consolidated Statements of Changes in Shareholders Equity (Deficit)
+for the Six Months Ended March 31, 2025 and 2024 (Unaudited)
+ F-4
+
+ 
+ 
+ 
+
+ 
+ Consolidated Statements of Cash Flows for the Six Months Ended March 31,
+2025 and 2024 (Unaudited)
+ F-5
+
+ 
+ 
+ 
+
+ 
+ Notes to Consolidated Financial Statements
+ F-6
+
+ 
+ 
+
+ F-1
+
+ 
+
+ 
+
+ 
+
+MEDIAON
+GROUP INC.
+
+CONSOLIDATED
+BALANCE SHEETS
+
+(UNAUDITED)
+
+(Stated
+in US Dollars)
+
+ 
+
+ 
+ 
+ As of 
+
+ 
+ 
+ March 31, 
+ September 30, 
+
+ 
+ 
+ 2025 
+ 2024 
+
+ 
+ 
+ (Unaudited) 
+ 
+
+ 
+ ASSETS 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Cash 
+ $88,448 
+ $186,684 
+
+ 
+ Accounts receivable, net 
+ 313,391 
+ 595,602 
+
+ 
+ Deposits, prepayments and other receivables, net 
+ 258,790 
+ 82,546 
+
+ 
+ Deferred IPO costs 
+ 453,834 
+ 338,301 
+
+ 
+ Total current assets 
+ 1,114,463 
+ 1,203,133 
+
+ 
+ 
+ 
+ 
+
+ 
+ Plant and equipment, net 
+ 9,440 
+ 10,370 
+
+ 
+ Right-of-use (ROU) asset – operating lease 
+ 181,861 
+ 217,435 
+
+ 
+ Due from related parties 
+ 1,619,473 
+ 1,732,590 
+
+ 
+ Investment in associate 
+ 16,597 
+ - 
+
+ 
+ Total non-current assets 
+ 1,827,371 
+ 1,960,395 
+
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL ASSETS 
+ $2,941,834 
+ $3,163,528 
+
+ 
+ 
+ 
+ 
+
+ 
+ LIABILITIES AND SHAREHOLDERS EQUITY (DEFICIT) 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ LIABILITIES 
+ 
+ 
+
+ 
+ CURRENT LIABILITIES 
+ 
+ 
+
+ 
+ Bank borrowings – current 
+ $318,646 
+ $301,523 
+
+ 
+ Accounts payable 
+ 536,790 
+ 684,400 
+
+ 
+ Accruals and other payables 
+ 274,675 
+ 338,506 
+
+ 
+ Customer deposits 
+ 32,493 
+ 57,407 
+
+ 
+ Advances from channel agents 
+ 24,183 
+ 4,973 
+
+ 
+ Deferred revenue 
+ 296,036 
+ 149,555 
+
+ 
+ Due to related parties 
+ 946,561 
+ 925,708 
+
+ 
+ Lease liabilities - current 
+ 71,021 
+ 69,572 
+
+ 
+ Promissory notes and loan 
+ 957,073 
+ 700,000 
+
+ 
+ Interest payable to promissory notes 
+ 235,973 
+ 131,260 
+
+ 
+ Payable for investment in associate 
+ 514 
+ - 
+
+ 
+ Total current liabilities 
+ 3,693,965 
+ 3,362,904 
+
+ 
+ 
+ 
+ 
+
+ 
+ NON-CURRENT LIABILITIES 
+ 
+ 
+
+ 
+ Bank borrowings – non-current 
+ 770,531 
+ 926,505 
+
+ 
+ Lease liabilities – non-current 
+ 97,182 
+ 140,945 
+
+ 
+ Deferred tax liabilities 
+ 52,067 
+ 35,881 
+
+ 
+ Due to directors 
+ 594,506 
+ 631,521 
+
+ 
+ Total non-current liabilities 
+ 1,514,286 
+ 1,734,852 
+
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL LIABILITIES 
+ $5,208,251 
+ $5,097,756 
+
+ 
+ 
+ 
+ 
+
+ 
+ SHAREHOLDERS EQUITY (DEFICIT) 
+ 
+ 
+
+ 
+ Class A Ordinary share, par value $0.0002 each, 233,500,000 shares authorized; 3,500,000 shares issued
+ and outstanding as of March 31, 2025 and September 30, 2024 *# 
+ $700 
+ $700 
+
+ 
+ Class B Ordinary Shares, par value $0.0002 each, 16,500,000 shares authorized; 16,500,000 shares issued
+ and outstanding as of March 31, 2025 and September 30, 2024 *# 
+ 3,300 
+ 3,300 
+
+ 
+ Additional paid-in capital 
+ 69,300 
+ 69,300 
+
+ 
+ Subscription receivable 
+ (70,000) 
+ (70,000)
+
+ 
+ Accumulated other comprehensive income 
+ 21,927 
+ 20,335 
+
+ 
+ Accumulated deficit 
+ (2,292,223) 
+ (1,958,442)
+
+ 
+ Total MediaOn Group Inc. shareholders deficit 
+ (2,266,996) 
+ (1,934,807)
+
+ 
+ 
+ 
+ 
+
+ 
+ Non-controlling interest 
+ 579 
+ 579 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total Shareholders deficit 
+ (2,266,417) 
+ (1,934,228)
+
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL LIABILITIES AND SHAREHOLDERS DEFICIT 
+ $2,941,834 
+ $3,163,528 
+
+ 
+
+ 
+
+*
+Retrospectively restated for effect of share recapitalization (Note 1)
+
+# On September 1, 2025, the Company effected
+a reverse stock split (the "Reverse Stock Split") of the Company s issued and outstanding Ordinary Shares at a
+split ratio of 1-for-2 such that every holder of Class A and Class B Ordinary Shares shall receive one share for every two shares of
+Ordinary shares held. After the Reverse Stock Split, the Company increased its authorized share capital from $40,000 to $50,000
+divided into 233,500,000 Class A Ordinary Shares of a par value of $0.0002 each and 16,500,000 Class B Ordinary Shares of a par
+value of $0.0002 each. All references to number of ordinary shares, and to per share information have been retroactively
+adjusted.
+
+ 
+
+The
+accompanying notes are an integral part of these unaudited consolidated financial statements.
+
+ 
+
+ F-2
+
+ 
+
+ 
+
+ 
+
+MEDIAON
+GROUP INC.
+
+CONSOLIDATED
+STATEMENTS OF OPERATIONS
+
+AND
+COMPREHENSIVE INCOME (LOSS)
+
+(UNAUDITED)
+
+(Stated
+in US Dollars)
+
+ 
+
+ 
+ 
+ For the six months ended 
+
+ 
+ 
+ March 31, 2025 
+ March 31, 2024 
+
+ 
+ 
+ 
+ 
+
+ 
+ Revenue 
+ $823,618 
+ $1,277,824 
+
+ 
+ Revenue - Related Party 
+ 5,305 
+ 9,912 
+
+ 
+ Total Revenue 
+ 828,923 
+ 1,287,736 
+
+ 
+ 
+ 
+ 
+
+ 
+ Costs and Expenses: 
+ 
+ 
+
+ 
+ Cost of revenues 
+ (320,489) 
+ (393,848)
+
+ 
+ Cost of revenues- Related Party 
+ (5,642) 
+ (693)
+
+ 
+ Marketing expenses 
+ (16,140) 
+ (203,703)
+
+ 
+ General and administrative expenses 
+ (594,604) 
+ (416,551)
+
+ 
+ General and administrative expenses- Related Party 
+ (78,114) 
+ (99,588)
+
+ 
+ Total costs and expenses 
+ (1,014,989) 
+ (1,114,383)
+
+ 
+ 
+ 
+ 
+
+ 
+ Operating (loss)/profit 
+ (186,066) 
+ 173,353 
+
+ 
+ 
+ 
+ 
+
+ 
+ Interest income 
+ 111 
+ 1,323 
+
+ 
+ Sundry expenses 
+ (9,101) 
+ (21,846)
+
+ 
+ Interest expenses 
+ (141,730) 
+ (66,485)
+
+ 
+ Exchange (loss) gain 
+ 3,163 
+ (3,652)
+
+ 
+ Total other expenses 
+ (147,557) 
+ (90,660)
+
+ 
+ 
+ 
+ 
+
+ 
+ (Loss) profit before taxes 
+ (333,623) 
+ 82,693 
+
+ 
+ 
+ 
+ 
+
+ 
+ Provision for income taxes 
+ (16,241) 
+ (15,151)
+
+ 
+ Equity income in investee 
+ 16,083 
+ - 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net (loss) income 
+ $(333,781) 
+ $67,542 
+
+ 
+ 
+ 
+ 
+
+ 
+ Other comprehensive income/(loss) 
+ 1,592 
+ (2,175)
+
+ 
+ Total comprehensive (loss) income 
+ $(332,189) 
+ $65,367 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net (loss) income attributable to: 
+ 
+ 
+
+ 
+ MediaOn Group Inc. 
+ (333,781) 
+ 67,542 
+
+ 
+ Non-controlling interests 
+ 
+ - 
+
+ 
+ 
+ $(333,781) 
+ $67,542 
+
+ 
+ 
+ 
+ 
+
+ 
+ Other comprehensive income/(loss) attributable to: 
+ 
+ 
+
+ 
+ MediaOn Group Inc. 
+ 1,592 
+ (2,175)
+
+ 
+ Non-controlling interests 
+ - 
+ - 
+
+ 
+ 
+ 1,592 
+ (2,175)
+
+ 
+ 
+ 
+ 
+
+ 
+ Net (loss) income per share Class A Ordinary Shares, basic and diluted# 
+ $(0.02) 
+ $- 
+
+ 
+ Net (loss) income per share Class B Ordinary Shares, basic and diluted*# 
+ $(0.02) 
+ $0.00 
+
+ 
+ Basic and diluted weighted average shares outstanding 
+ 
+ 
+
+ 
+ Class A Ordinary Shares# 
+ 3,500,000 
+ - 
+
+ 
+ Class B Ordinary Shares*# 
+ 16,500,000 
+ 16,500,000 
+
+ 
+
+ 
+
+*
+Retrospectively restated for effect of share recapitalization (Note 1)
+
+# On September 1, 2025, the
+Company effected a reverse stock split of the Company s issued and outstanding Ordinary
+Shares at a split ratio of 1-for-2 such that every holder of Class A and Class B Ordinary Shares shall receive one share for every two
+shares of Ordinary shares held. All references to number of ordinary shares, and to per share information have been retroactively adjusted.
+
+ 
+
+The
+accompanying notes are an integral part of these unaudited consolidated financial statements.
+
+ 
+
+ F-3
+
+ 
+
+ 
+
+ 
+
+MEDIAON
+GROUP INC.
+
+CONSOLIDATED
+STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY (DEFICIT)
+
+(UNAUDITED)
+
+(Stated
+in US Dollars)
+
+ 
+
+ 
+ 
+ Class A
+
+ Ordinary
+
+ Share 
+ Class B Ordinary Share 
+ Additional 
+ 
+ 
+ Accumulated Other 
+ Total MediaOn Group Inc. 
+ Non- 
+ Total 
+
+ 
+ 
+ Number of 
+ Par 
+ Number of 
+ Par 
+ Paid-in 
+ Subscription 
+ Accumulated 
+ Comprehensive 
+ Shareholders 
+ Controlling 
+ Shareholders 
+
+ 
+ 
+ Shares# 
+ Value 
+ Shares*# 
+ Value 
+ Capital 
+ Receivable 
+ Deficits 
+ Income/(Loss) 
+ Deficit 
+ Interest 
+ Deficits 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ BALANCE, September 30, 2023* 
+ - 
+ $- 
+ 16,500,000 
+ $3,300 
+ $- 
+ $- 
+ $(1,793,339) 
+ $30,488 
+ $(1,759,551) 
+ $- 
+ $(1,759,551)
+
+ 
+ Net income 
+ - 
+ - 
+ - 
+ - 
+ - 
+ 
+ 67,542 
+ - 
+ 67,542 
+ - 
+ 67,542 
+
+ 
+ Other Comprehensive Loss 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ 
+ (2,175) 
+ (2,175) 
+ - 
+ (2,175)
+
+ 
+ BALANCE, March 31, 2024 
+ - 
+ $- 
+ 16,500,000 
+ $3,300 
+ $- 
+ $- 
+ $(1,725,797) 
+ $28,313 
+ $(1,694,184) 
+ $- 
+ $(1,694,184)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ BALANCE, September 30, 2024 
+ 3,500,000 
+ $700 
+ 16,500,000 
+ $3,300 
+ $69,300 
+ $(70,000) 
+ $(1,958,442) 
+ $20,335 
+ $(1,934,807) 
+ $579 
+ $(1,934,228)
+
+ 
+ Net loss 
+ - 
+ - 
+ - 
+ - 
+ - 
+ 
+ (333,781) 
+ - 
+ (333,781) 
+ - 
+ (333,781)
+
+ 
+ Other Comprehensive Income 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ 1,592 
+ 1,592 
+ - 
+ 1,592 
+
+ 
+ BALANCE, March 31, 2025 
+ 3,500,000 
+ $700 
+ 16,500,000 
+ $3,300 
+ $69,300 
+ $(70,000) 
+ $(2,292,223) 
+ $21,927 
+ $(2,266,996) 
+ $579 
+ $(2,266,417)
+
+ 
+
+ 
+
+*
+Retrospectively restated for effect of share recapitalization (Note 1)
+
+# On September 1, 2025, the Company
+effected a reverse stock split of the Company s issued and outstanding Ordinary Shares
+at a split ratio of 1-for-2 such that every holder of Class A and Class B Ordinary Shares shall receive one share for every two shares
+of Ordinary shares held. All references to number of ordinary shares, and to per share information have been retroactively adjusted.
+
+ 
+
+The
+accompanying notes are an integral part of these unaudited consolidated financial statements.
+
+ 
+
+ F-4
+
+ 
+
+ 
+
+ 
+
+MEDIAON
+GROUP INC.
+
+CONSOLIDATED
+STATEMENTS OF CASH FLOWS
+
+FOR
+THE SIX MONTHS ENDED MARCH 31, 2025 AND 2024
+
+(UNAUDITED)
+
+(Stated
+in US Dollars)
+
+ 
+
+ 
+ 
+ 2025 
+ 2024 
+
+ 
+ 
+ 
+ 
+
+ 
+ CASH FLOWS FROM OPERATING ACTIVITIES 
+ 
+ 
+
+ 
+ Net (Loss) Income from continuing operations 
+ $(317,540) 
+ $82,693 
+
+ 
+ 
+ 
+ 
+
+ 
+ Adjustments to reconcile net profit to net cash provided by (used in) operating activities: 
+ 
+ 
+
+ 
+ Depreciation 
+ 2,003 
+ 2,194 
+
+ 
+ Non-cash lease expense 
+ 4,249 
+ 7,423 
+
+ 
+ Allowance for doubtful accounts 
+ (3,800) 
+ 3,997 
+
+ 
+ Equity income in investee 
+ (16,083) 
+ - 
+
+ 
+ Changes in assets and liabilities: 
+ 
+ 
+
+ 
+ ROU operating lease assets 
+ 35,290 
+ 166,892 
+
+ 
+ Accounts receivable 
+ 285,301 
+ 541,120 
+
+ 
+ Deposits, prepayments and other receivables 
+ (176,419) 
+ 229,511 
+
+ 
+ Amounts due from related parties 
+ 110,797 
+ 669,588 
+
+ 
+ Accounts payable 
+ (146,730) 
+ (954,292)
+
+ 
+ Accruals and other payables 
+ (63,393) 
+ (69,751)
+
+ 
+ Amount due to related parties 
+ 22,121 
+ (85,869)
+
+ 
+ Lease liabilities 
+ (46,290) 
+ (181,031)
+
+ 
+ Deferred revenue 
+ 146,737 
+ 47,445 
+
+ 
+ Deposit revenue 
+ (24,844) 
+ 7,234 
+
+ 
+ Deposit from channels 
+ 19,224 
+ 3,481 
+
+ 
+ Amount due to directors 
+ (36,168) 
+ (1,593,827)
+
+ 
+ Interest payable to promissory notes 
+ 104,711 
+ 34,027 
+
+ 
+ Net cash (used in) operating activities 
+ (100,834) 
+ (1,089,165)
+
+ 
+ 
+ 
+ 
+
+ 
+ CASH FLOWS FROM INVESTING ACTIVITIES 
+ 
+ 
+
+ 
+ Purchase of plant and equipment 
+ (1,088) 
+ (3,985)
+
+ 
+ Net cash (used in) investing activities 
+ (1,088) 
+ (3,985)
+
+ 
+ 
+ 
+ 
+
+ 
+ CASH FLOWS FROM FINANCING ACTIVITIES 
+ 
+ 
+
+ 
+ Proceeds from bank borrowings 
+ - 
+ 370,977 
+
+ 
+ Repayments of bank borrowings 
+ (137,227) 
+ (127,408)
+
+ 
+ Deferred IPO costs 
+ (116,036) 
+ (268,484)
+
+ 
+ Proceeds from issuance of promissory notes 
+ - 
+ 600,000 
+
+ 
+ Proceeds from loan borrowings 
+ 257,165 
+ - 
+
+ 
+ Net cash provided by financing activities 
+ 3,902 
+ 575,085 
+
+ 
+ 
+ 
+ 
+
+ 
+ Effect of exchange rate on cash 
+ (216) 
+ 688 
+
+ 
+ Net (decrease) increase in cash 
+ (98,236) 
+ (517,377)
+
+ 
+ Cash and cash equivalents, beginning of year 
+ 186,684 
+ 649,067 
+
+ 
+ Cash and cash equivalents, end of year 
+ $88,448 
+ $131,690 
+
+ 
+ 
+ 
+ 
+
+ 
+ Supplementary cash flow information: 
+ 
+ 
+
+ 
+ Taxes paid 
+ $- 
+ $- 
+
+ 
+ Interest paid 
+ $37,018 
+ $32,458 
+
+ 
+
+ 
+
+ F-5
+
+ 
+
+ 
+
+ 
+
+NOTE
+1 – ORGANIZATION AND PRINCIPAL ACTIVITIES
+
+ 
+
+MediaOn
+Group Inc. ("MEON", "MediaOn" or the "Company") was incorporated in the Cayman Islands ("Cayman")
+on March 20, 2024 as an investment holding company. MEON is a parent holding company without operations.
+
+ 
+
+MediaOn
+Holdings Limited ("MOBVI"), a wholly owned subsidiary by the original common control shareholders, was incorporated in the
+British Virgin Islands ("BVI") on March 20, 2024. MOBVI has 1 (one) ordinary share issued and outstanding with a par value
+of $1. MOBVI is an investment holding company with no operations.
+
+ 
+
+MediaOn
+Limited ("MOHK"), a wholly owned private company limited by shares incorporated on July 27, 2011. MOHK. MOHK has 1,000 ordinary
+shares issued and outstanding with a par value of HK$1. MOHK is our primary operating subsidiary.
+
+ 
+
+Mosaic
+Creative Company Limited ("Mosaic"), a 55% owned private company limited by shares incorporated on August 27, 2024 under
+the laws of Hong Kong. Mosaic has 10,000 ordinary shares issued and outstanding with a par value of HK$1. Mosaic will be our operating
+subsidiary for creative business.
+
+ 
+
+The
+Company together with its subsidiaries (collective the "Group") conducts its primary operations through its indirectly wholly-owned
+subsidiaries MediaOn Limited ("MOHK") and 55% owned subsidiary Mosaic Creative Company Limited ("Mosaic").
+
+ 
+
+MOHK
+manages a network of digital media which create and publish contents to internet search engines and social media platforms such as Yahoo,
+Google, Facebook, YouTube, Instagram, LinkedIn and Xiaohongshu, and online to offline ("O2O") events for various clients
+from non-governmental organization ("NGO") to small and medium enterprises ("SME"). We also provide our clients
+artificial intelligent interactive and multimedia creations. Additionally, we will provide customized media services which includes digital
+outdoor marketing.
+
+ 
+
+Reorganization
+
+ 
+
+The
+Reorganization was completed on July 29, 2024 through a series of planned transactions. As a result of the Reorganization, the Company
+has become the holding company for all previously mentioned entities.
+
+ 
+
+Immediately
+before the Reorganization, MOHK was owned and commonly controlled by Vizz Digital Group Limited and its shareholders, which is 100% owned
+by Vizz Group (Holdings) Limited and common control shareholders, and functioned as the sole operational entity.
+
+ 
+
+On
+March 20, 2024, MEON was established as an exempted company with limited liability in the Cayman Islands, with the sole purpose of acting
+as holding company for the Group. On March 20, 2024, MOBVI was established as intermedium holding company for MOHK.
+
+ 
+
+On
+July 29, 2024, 100% ownership of MOHK was acquired from Vizz Digital Group Limited by MOBVI. Tech Vision Investments Limited, a BVI company
+100% owned by Vizz Technology Limited and common control shareholders and 100% indirectly owned by Vizz Technology Limited and common
+control shareholders, established on July 29, 2024, which was allotted shares of MEON to indirectly owned MOBVI. On the same day, 100%
+ownership of MOBVI was transferred to MEON. Both MEON and MOBVI served as a holding company and had not engaged in any business activities.
+
+ 
+
+Immediately
+before and after the Reorganization, MEON, MOBVI, and MOHK remained under common control of a group of shareholders. Consequently, the
+Reorganization is classified as a common control transaction under ASC 805-50.
+
+ 
+
+On
+August 27, 2024, Mosaic Creative Company Limited ("Mosaic") a private company limited by shares was incorporated under the
+laws of Hong Kong for the focus on creative business. On the day of these financial statements, Mosaic has started business.
+
+ 
+
+Following
+this, the consolidation of the Company and its subsidiaries has been accounted for at historical cost and prepared on the basis as if
+the aforementioned transactions had become effective as of the beginning of the first period presented in these consolidated financial
+statements. Results of operations for the periods presented comprise those of the previously separate entities combined from the beginning
+of the period to the end of the period, eliminating the effects of intra-entity transactions.
+
+ 
+
+ F-6
+
+ 
+
+ 
+
+ 
+
+The
+following chart summarizes our corporate structure:
+
+ 
+
+ 
+
+The
+accompanying audited consolidated financial statements reflect the activities of the Company, and each of the following entities:
+
+ 
+
+ 
+ Name of Company 
+ Place of Incorporation 
+ Attributable
+
+ equity
+
+ interest % 
+ Issued capital 
+ Principle Activities
+
+ 
+ MediaOn Holdings Limited ("MOBVI") 
+ BVI 
+ 100 
+ $1,000 
+ Holding Company
+
+ 
+ MediaOn Limited ("MOHK") 
+ HKSAR 
+ 100 
+ $128 
+ Media Services
+
+ 
+ Mosaic Creative Co., Ltd. ("Mosaic") 
+ HKSAR 
+ 55 
+ $1,282 
+ Creative Business
+
+ 
+
+ 
+
+ F-7
+
+ 
+
+ 
+
+ 
+
+NOTE
+2 – LIQUIDITY AND GOING CONCERN
+
+ 
+
+The
+Company s assessment of going concern considerations is required to be made in accordance with ASU 2014-15, "Disclosures
+of Uncertainties about an Entity s Ability to Continue as a Going Concern".
+
+ 
+
+As
+indicated in the accompanying consolidated financial statements, the Company had a net loss of $333,781 and a net profit of $67,542
+for six months ended March 31, 2025 and 2024, respectively. The Company has negative cash flows from operating activities for
+both the six months ended March 31, 2025 and 2024, and has significant working capital deficiency of $2,579,502 and
+accumulated deficits of $2,292,223 as of March 31, 2025. Management has evaluated its available cash balance and funding
+sources against its working capital requirements and believes that its capital resources are insufficient to maintain its business
+operations for the next twelve months.
+
+ 
+
+The
+Company s profitability was negatively impacted by the ongoing slow resumption of economic activities, the Company s profit
+could be significantly reduced, and management may need to raise additional funds for working capital through (1) the possible sale of
+its equity securities (2) bank borrowings; (3) short-term borrowings from the shareholders or other related parties; and/or (4) proceed
+from public offering. In addition, the management has started costs and expenses procurements to decrease cash outflows. However, there
+is no assurance that the Company will be successful in accomplishing any of its aforementioned plans.
+
+ 
+
+Building
+on cost control initiatives, the Company is optimistic in generating sufficient operating cash flows to meet its working capital requirements
+for the six months ended March 31, 2025, however there can be no assurance that the Company can generate sufficient operating
+cash flows for the next twelve months.
+
+ 
+
+The
+accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates
+the realization of assets and satisfaction of liabilities in the normal course of business. The accompanying consolidated financial statements
+do not include any adjustments related to the recoverability and or classification of the recorded asset amounts and or the classification
+of the liabilities that might be necessary should the Company be unable to continue as a going concern.
+
+ 
+
+NOTE
+3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
+
+ 
+
+Basis
+of presentation and principle of consolidation
+
+ 
+
+The
+accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the
+United States ("U.S. GAAP") and pursuant to the rules and regulations of the Securities Exchange Commission ("SEC").
+
+ 
+
+These
+consolidated financial statements include the financial statements of the Company and its subsidiaries. All intercompany transactions
+and balances among the Company and its subsidiaries have been eliminated upon consolidation.
+
+ 
+
+Foreign
+currency translation
+
+ 
+
+The
+accompanying audited consolidated financial statements are presented in United States dollar ("$"). The functional currency
+of the Company is Hong Kong dollar ("HK$"). MOHK s statement of operation and balance sheet are translated into $ from
+HK$ at HK$7.7771=$1.0 for statement of operation and at HK$7.7799=$1.0 for balance sheet for the six moths ended March 31, 2025 and at
+HK$7.8172=$1.0 for statement of operation and at HK$7.8259=$1.0 for balance sheet (cash flow purpose) for the six months
+ended March 31, 2024.
+
+ 
+
+Our
+reporting currency is U.S. Dollars ("US$"). We determine the functional currency of each of our international subsidiaries
+and their operating divisions based on the primary currency in which they operate. In cases where the functional currency is not US$,
+we recognize a cumulative translation adjustment created by the different rates we apply to current period income or loss and the balance
+sheet. For each subsidiary, we apply the average functional exchange rate to its income or loss and the year-end functional exchange
+rate to translate the balance sheet.
+
+ 
+
+ F-8
+
+ 
+
+ 
+
+ 
+
+Use
+of estimates
+
+ 
+
+The
+preparation of the audited consolidated financial statements in conformity with accounting principles generally accepted in the United
+States of America ("US GAAP"), requires management to make estimates and assumptions that affect the reported amounts of
+assets and liabilities, disclosure of contingent assets and liabilities at the date of the audited consolidated financial statements
+and the reported amounts of revenues and expenses during the reporting periods.
+
+ 
+
+Significant
+accounting estimates required to be made by management which reflected in the Company s consolidated financial statements include
+the useful lives of property and equipment, the collectability of accounts & fair value of long-lived assets, the discount rate of
+leases, and uncertain tax position.
+
+ 
+
+The
+Company evaluates its estimates and assumptions on an ongoing basis and its estimates on historical experience, current and expected
+future conditions and various other assumptions that management believes are reasonable under the circumstances based on the best information
+available to management at the time these estimates and assumptions are made. However, actual results could differ from these estimates.
+
+ 
+
+Cash
+
+ 
+
+The
+Company considers cash and bank deposit primarily of cash in accounts held at a financial institution.
+
+ 
+
+Leases
+
+ 
+
+The
+Company adopted ASU No. 2016-02 — Leases (Topic 842) since September 30, 2021, using a modified retrospective transition method
+permitted under ASU No. 2018-11. This transition approach provides a method for recording existing leases only at the date of adoption
+and does not require previously reported balances to be adjusted. The Company evaluates the contracts it enters into to determine whether
+such contracts contain leases at inception. A contract contains a lease if the contract conveys the right to control the use of identified
+property, plant or equipment for a period of time in exchange for consideration. At commencement, contracts containing a lease are further
+evaluated for classification as an operating or finance lease where the Company is a lessee.
+
+ 
+
+Operating
+Leases
+
+ 
+
+A
+lease for which substantially all the benefits and risks incidental to ownership remain with the lessor is classified by the lease as
+an operation lease. Operating leases are included in the line items right-of-use ("ROU") asset, lease liabilities in current
+and non-current in the consolidated balance sheet.
+
+ 
+
+ROU
+assets represent the Company s right to use an underlying asset for the lease term and lease liabilities represent its obligation
+to make lease payments arising from the lease. For operating leases, the Company measures its lease liabilities based on the present
+value of the total lease payments not yet paid discounted based on the more readily determinable of the rate implicit in the lease or
+its incremental borrowing rate, which is the estimated rate the Company would be required to pay for a collateralized borrowing equal
+to the total lease payments over the term of the lease. The Company uses its incremental borrowing rate based on the information available
+at lease commencement date in determining the present value of lease payments. The Company measures ROU assets based on the corresponding
+lease liability adjusted for payments made to the lessor at or before the commencement date, and initial direct costs it incurs under
+the lease. The Company begins recognizing lease expense when the lessor makes the underlying asset available to the Company. Lease expenses
+for lease payments are recognized on a straight-line basis over the lease term.
+
+ 
+
+For
+leases with lease term less than one year (short-term leases), the Company has elected not to recognize a lease liability or ROU asset
+on its consolidated balance sheet. Instead, it recognizes the lease payments as expenses on a straight-line basis over the lease term.
+Short-term lease costs are immaterial to its consolidated statements of operations and cash flows.
+
+ 
+
+In
+considering the accounting implications of a facility the Company subleased a properties to an independent third party with verbal agreement
+with landlord, the Company determined that it would be inappropriate to de-recognize the sublease based on the guidance in ASC 842-20-40-3,
+since the Company was not relieved of the Company s primary obligation under the original lease when we assigned it to the independent
+third party. As such, the Company did not consider this to be a termination of the lease, and instead, the Company separately accounts
+for the original lease and sublease. As a result, and after assessing the recoverability of the related ROU asset, there was no change
+to our Operating lease assets or liabilities as a result of the assignment of this lease, and the Company continued to account for the
+lease as an operating lease in accordance with ASC 842-20-35-14.
+
+ 
+
+Deposits
+and prepayments
+
+ 
+
+The
+Company makes a deposit payment to suppliers for the procurement of products and services. Upon physical receipt and inspection of products
+or provision of services from suppliers, the applicable amount is recognized from deposits and prepayments to cost of revenues.
+
+ 
+
+Deferred
+IPO costs
+
+ 
+
+Deferred
+IPO costs consist of underwriting, legal, accounting and other expenses incurred through the balance sheet date that are directly related
+to the Initial Public Offering and that were charged to shareholders equity upon the completion of the Initial Public Offering.
+As of March 31, 2025 and September 30, 2024, the Company had deferred IPO costs of $453,834 and $338,301, respectively.
+
+ 
+
+ F-9
+
+ 
+
+ 
+
+ 
+
+NOTE
+3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
+
+ 
+
+Plant
+and equipment, net
+
+ 
+
+Plant
+and equipment are carried at cost less accumulated depreciation. Depreciation is provided over their estimated useful lives, using the
+straight-line method. The Company typically applies a salvage value of 0%. The salvage value, the useful life of assets, and methods
+of depreciation are reviewed at the end of each fiscal year, and adjusted prospectively, where applicable. The Company reviewed the useful
+life of property, plant and equipment in 2025 and no significant changes were deemed necessary. The estimated useful lives of
+the plan and equipment are as follows:
+
+ 
+
+ 
+ Furniture
+ and fixtures
+ 
+ 3-5
+ years
+
+ 
+ Office
+ equipment
+ 
+ 3-5
+ years
+
+ 
+ Computer
+ equipment
+ 
+ 3-5
+ years
+
+ 
+ 
+
+The
+cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts, and any gain or loss
+are included in the Company s results of operations. The costs of maintenance and repairs are recognized as incurred; significant
+renewals and betterments are capitalized.
+
+ 
+
+Accounting
+for the impairment of long-lived assets
+
+ 
+
+The
+Company annually reviews its long-lived assets for impairment or whenever events or changes in circumstances indicate that the carrying
+amount of assets may not be recoverable. Impairment may become obsolete from a difference in the industry, introduction of new technologies,
+or if the Company has inadequate working capital to utilize the long-lived assets to generate adequate profits. Impairment is present
+if the carrying amount of an asset is less than its expected future undiscounted cash flows.
+
+ 
+
+If
+an asset is considered impaired, a loss is recognized based on the amount by which the carrying amount exceeds the fair market value
+of the asset. Assets to be disposed of are reported lower the carrying amount or fair value fewer costs to selling.
+
+ 
+
+The
+Company did not identify impairment of long-lived assets for the six months ended March 31, 2025 and year ended September 30,
+2024.
+
+ 
+
+Investment
+
+ 
+
+Investments
+are accounted for using the equity method if the investment provides the Company the ability to exercise significant influence, but not
+control, over an investee. Significant influence is generally deemed to exist if the Company has an ownership interest in the voting
+stock of the investee between 20% and 50%, although other factors are considered in determining whether the equity method is appropriate.
+Also, investments in limited partnerships of more than 3% to 5% are generally viewed as more than minor and are accounted for using equity
+method.
+
+ 
+
+The
+Company accounts for equity investments according to ASU 2016-01 equity method as fair value is not readily available.
+
+ 
+
+Commitments
+and contingencies
+
+ 
+
+From
+time to time, the Company is a party to various legal actions arising in the ordinary course of business. The majority of these claims
+and proceedings related to or arise from commercial disputes. The Company first determine whether a loss from a claim is probable, and
+if it is reasonable to estimate the potential loss. The Company accrues costs associated with these matters when they become probable,
+and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. Also,
+the Company disclose a range of possible losses, if a loss from a claim is probable but the amount of loss cannot be reasonably estimated,
+which is in line with the applicable requirements of Accounting Standard Codification 450. The Company s management does not expect
+any liability from the disposition of such claims and litigation individually or in the aggregate would have a material adverse impact
+on the Company s consolidated financial position, results of operations and cash flows.
+
+ 
+
+Related
+parties
+
+ 
+
+The
+Company adopted ASC 850, Related Party Disclosures, for the identification of related parties and disclosure of related party transactions.
+
+ 
+
+Revenue
+recognition
+
+ 
+
+The
+Company follows the rules and guidance set out under ASC 606, Revenue from Contracts with Customers ("ASC 606"), when recognizing
+revenue from contracts with customers. The core principle of ASC 606 requires an entity to recognize revenues to depict the transfer
+of goods to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods
+recognized as performance obligations are satisfied. In accordance with ASC 606, revenues are recognized when the Company satisfies the
+performance obligations by delivering the promised goods to the customers, in an amount that reflects the consideration the Company expects
+to be entitled to in exchange for those goods. The following five steps are applied to achieve that core principle:
+
+ 
+
+ 
+ 
+ Step
+ 1:
+ Identify
+ the contract with the customer
+
+ 
+ 
+ Step
+ 2:
+ Identify
+ the performance obligations in the contract
+
+ 
+ 
+ Step
+ 3:
+ Determine
+ the transaction price
+
+ 
+ 
+ Step
+ 4:
+ Allocate
+ the transaction price to the performance obligations in the contract
+
+ 
+ 
+ Step
+ 5:
+ Recognize
+ revenue when the company satisfies a performance obligation.
+
+ 
+ 
+
+ F-10
+
+ 
+
+ 
+
+ 
+
+Revenue
+is primarily derived from: 1) media placements – for search engines and social media; 2) media rebates; and 3) marketing campaigns,
+which includes, but not limited to, i) online and offline marketing events; ii) search engine optimizations (SEO); iii) contents creative
+design and production; iv) web-site designs and maintenances; v) social media listening tools; vi) media placement execution supports;
+and vii) traditional TV commercials and outdoor billboards.
+
+ 
+
+For
+revenue arrangements with multiple distinct performance obligations, services promised in the contract are highly interrelated with each
+other and it s not separately identifiable from other promises in the contract. Therefore, all goods and services in the contract
+are exclusively accounted for as a single performance obligation.
+
+ 
+
+The
+Company evaluates if it is a principal or an agent in a transaction to determine whether revenue should be recorded on a gross or net
+basis. The Company is acting as the principal if it obtains control over the goods and services before they are transferred to customers.
+Generally, when the Company is primarily obligated in a transaction, is subject to inventory risk, has latitude in establishing prices,
+or has several but not all of these indicators, the Company acts as the principal and revenue is recorded on a gross basis. Generally,
+when the Company is not primarily obligated in a transaction, does not bear the inventory risk and does not have the ability to establish
+the price, the Company acts as the agent and revenue is recorded on a net basis.
+
+ 
+
+ 
+ 
+ 1.
+ Media
+ Placement
+
+ 
+
+ We
+ offer media planning, potential media spendings and performance services to our customers. The media placements are operated by our
+ suppliers, and we act as an agent in these transactions. The commissions and any related fulfilment fees we earn from these arrangements
+ are recognized when the services are rendered, which generally occurs upon the media placement occurred to the customers.
+
+ 
+
+ We
+ recognize media placement revenue, net of media costs (our fees/commissions) according to the proportion of our obligations having
+ been delivered for advertisement placements with media stated in our contracts with our clients, and confirmation of placement orders
+ from relevant media.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 2.
+ Media
+ Rebates
+
+ 
+
+ We
+ earn the revenue from media suppliers when the total amount generated from media placements achieves the certain amount agreed by
+ the suppliers and us. Our progressive media rebates on the basis of media spendings starting from 20% and up to 30%. Variable consideration
+ for our media businesses includes rebate revenue and is recognized when it is probable that the media will be run, including when
+ it is not subject to cancellation by the client. Performance incentives are typically recognized in revenue over time.
+
+ 
+
+ We
+ recognize media rebates according to our media placement achievements agreed with media suppliers. We recognize media rebates at
+ relevant contracted achievement level, starting from 20% basis, basing on our records and reconcile with the media supplier every
+ month. When we have achieved a higher level of achievements, we will recognize additional media rebates basing on contract with media
+ supplier.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 3.
+ Marketing
+ Campaigns
+
+ 
+
+ Marketing
+ Campaigns include, but not limited to, i) online and offline marketing events; ii) search engine optimizations (SEO); iii) contents
+ creative design and production; iv) web-site designs and maintenances; v) social media listening tools; vi) media placement execution
+ supports; and vii) traditional TV commercials and outdoor billboards.
+
+ 
+
+ Revenue,
+ related to ongoing services for marketing such as search engine optimizations (SEO), web-site designs and maintenances, social media
+ listening tools, is recognized over time as services are provided.
+
+ 
+
+ Revenue,
+ related to online and offline marketing events, media placement execution supports, traditional TV commercials and outdoor billboards,
+ and contents creative design and production, is recognized upon completion of services.
+
+ 
+ 
+
+ F-11
+
+ 
+
+ 
+
+ 
+
+Cost
+of revenues
+
+ 
+
+Cost
+of revenues consist primarily of costs associated with the arrangements with media platforms. These mainly include costs related to inhouse
+creative and production of contents, channel agents share of rebate, etc. Cost of revenues also include actual product costs paid
+to suppliers and the cost of transportation to the Company s customers.
+
+ 
+
+Accounts
+receivable, net
+
+ 
+
+Accounts
+receivable, net includes amounts billed under the contract terms, normally 30 days. The amounts are stated at their net realizable value.
+The Company considers several factors in its estimate of the allowance, including knowledge of a client s financial condition,
+its historical collection experience, and other factors relevant to assessing the collectability of such receivables. Bad debts are written
+off against allowances. The Company maintains an allowance for expected credit loss to provide for the estimated number of receivables
+that will not be collected.
+
+ 
+
+Deferred
+revenue
+
+ 
+
+Deferred
+revenue includes amount billed to customer with receipts for which the aforementioned revenue recognition criteria have not yet been
+met.
+
+ 
+
+Deferred
+revenue is mainly unearned revenue related to direct media services, support services and events. Normal expected delivery period for
+our obligations is about 3 months. As of March 31, 2025 and September 30, 2024, we recognized $296,036 and $149,555
+of unearned revenue, respectively.
+
+ 
+
+Expected
+credit loss
+
+ 
+
+ASU
+No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments requires
+entities to use a current lifetime expected credit loss methodology to measure impairments of certain financial assets. Using this methodology
+will result in earlier recognition of losses than under the current incurred loss approach, which requires waiting to recognize a loss
+until it is probable of having been incurred. There are other provisions within the standard that affect how impairments of other financial
+assets may be recorded and presented, and that expand disclosures. The Company adopted the new standard effective October 1, 2021, the
+first day of the Company s fiscal year and applied to accounts receivable and other financial instruments. The adoption of this
+guidance did not materially impact the net earning and financial position and has no impact on the cash flows.
+
+ 
+
+Advertising
+
+ 
+
+All
+advertising costs are expensed as incurred.
+
+ 
+
+Retirement
+benefits
+
+ 
+
+Retirement
+benefits in the form of mandatory government-sponsored defined contribution plans (Mandatory Provident Fund) are charged to either expense
+as incurred or allocated to wages as part of cost of revenues.
+
+ 
+
+Income
+taxes
+
+ 
+
+The
+Company recognizes deferred income tax assets or liabilities for expected future tax consequences of events recognized in the audited
+consolidated financial statements or tax returns. Under this method, deferred income tax assets or liabilities are determined based upon
+the difference between the audited consolidated financial statement and income tax bases of assets and liabilities using enacted tax
+rates expected to apply when the differences settle or become realized. Valuation allowances are provided when it is more likely than
+not that a deferred tax asset is not realizable or recoverable in the future.
+
+ 
+
+The
+Company determines that the tax position is more likely than not to be sustained and records the largest amount of benefit that is more
+likely than not to be realized when the tax position is settled. The Company recognizes interest and penalties, if any, related to uncertain
+tax positions in income tax expense.
+
+ 
+
+ F-12
+
+ 
+
+ 
+
+ 
+
+Comprehensive
+income (loss)
+
+ 
+
+The
+Company presents comprehensive income (loss) in accordance with ASC Topic 220, Comprehensive Income. ASC Topic 220 states that
+all items that are required to be recognized under accounting standards as components of comprehensive income (loss) be reported in the
+consolidated financial statements. The components of comprehensive income (loss) were the net income for the years and the foreign currency
+translation adjustments.
+
+ 
+
+Income/(Loss)
+per share
+
+ 
+
+The
+Company computes income/(loss) per share following ASC Topic 260, "Earnings per share." Basic income/(loss) per share is
+measured as the income/(loss) available to common shareholders divided by the weighted average common shares outstanding for the period.
+Diluted loss per share presents the dilutive effect on a per-share basis from the potential conversion of convertible securities or the
+exercise of options and or warrants; the dilutive impacts of potentially convertible securities are calculated using the as-if method;
+the potentially dilutive effect of options or warranties are computed using the treasury stock method. Potentially anti-dilutive securities
+(i.e., those that increase income per share or decrease loss per share) are excluded from diluted income/(loss) per share calculation.
+There were no potentially dilutive securities that were in-the-money that were outstanding during the six months ended March 31, 2025
+and 2024.
+
+ 
+
+Segment
+reporting
+
+ 
+
+ASC
+280, "Segment Reporting", establishes standards for reporting information about operating segments on a basis consistent
+with the Company s internal organizational structure as well as information about geographical areas, business segments and major
+customers in financial statements for detailing the Company s business segments. The Company uses the "management approach"
+in determining reportable operating segments. The management approach considers the internal organization and reporting used by the Company s
+chief operating decision maker for making operating decisions and assessing performance as the source for determining the Company s
+reportable segments. Management, including the chief operating decision maker, reviews operation results by the revenue of different
+products or services. Based on management s assessment, the Company had three operating and reportable segments during the six
+months presented as set out in Note 14.
+
+ 
+
+Financial
+instruments
+
+ 
+
+The
+Company s financial instruments, including cash and cash equivalents, accounts and other receivables, accounts and other payables,
+accrued liabilities, amounts due from (to) related parties, promissory notes payable and bank and other loans, have carrying amounts
+that approximate their fair values due to their short maturities. ASC Topic 820, "Fair Value Measurements and Disclosures"
+requires disclosing the fair value of financial instruments held by the Company. ASC Topic 825, "Financial Instruments" defines
+fair value and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements
+for fair value measures. The carrying amounts reported in the audited consolidated balance sheets for cash and cash equivalents, accounts
+and other receivables, accounts and other payables, accrued liabilities, amounts due from (to) related parties, promissory notes payable
+and bank and other loans each qualify as financial instruments and are a reasonable estimate of their fair values because of the short
+period between the origination of such instruments and their expected realization and their current market rate of interest. The three
+levels of valuation hierarchy are defined as follows:
+
+ 
+
+ 
+ 
+ 
+ Level
+ 1 – inputs to the valuation methodology used quoted prices for identical assets or liabilities in active markets. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Level
+ 2 – inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and information
+ that are observable for the asset or liability, either directly or indirectly, for substantially the financial instrument s
+ full term. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Level
+ 3 – inputs to the valuation methodology are unobservable and significant to the fair value measurement. 
+
+ 
+ 
+
+ F-13
+
+ 
+
+ 
+
+ 
+
+Recent
+accounting pronouncements
+
+ 
+
+We
+qualify as an "emerging growth company", or EGC, pursuant to the Jumpstart Our Business Startups Act of 2012, as amended,
+or the JOBS Act. As an EGC, the Company does not need to comply with any new or revised financial accounting standards until such date
+that a private company is otherwise required to comply with such new or revised accounting standards. We will adopt the standards based
+on the extended transition period provided to private companies.
+
+ 
+
+In
+November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2023-07, Segment Reporting
+(Topic 280): Improvements to Reportable Segment Disclosures (ASU 2023-07), which requires that an entity disclose significant segment
+expenses impacting profit and loss that are regularly provided to the chief operating decision maker. The update is required to be applied
+retrospectively to prior periods presented, based on the significant segment expense categories identified and disclosed in the period
+of adoption. This ASU guidance is effective for our financial reports on this prospectus for the year ended September 30, 2024, and subsequent
+interim periods, with early adoption permitted.
+
+ 
+
+In
+December 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures (ASU 2023-09), which requires that an entity
+disclose specific categories in the effective tax rate reconciliation as well as provide additional information for reconciling items
+that meet a quantitative threshold. Further, this ASU requires certain disclosures of state versus federal income tax expense and taxes
+paid. This ASU is effective for our Annual Report on Form 20-F for the year ended September 30, 2025, with early adoption permitted.
+The Company does not expect the adoption of ASU 2023-09 to have a material impact on its financial statements.
+
+ 
+
+In
+November 2024, the FASB issued ASU No. 2024-03, Disaggregation of Income Statement Expenses (Topic 220-40). The ASU requires more
+detailed disclosure for expenses. The ASU is effective for annual reporting periods beginning after December 15, 2026, with early adoption
+permitted. The amendments can be applied on either a prospective or retroactive basis. We are currently evaluating the ASU to determine
+its impact on our disclosures.
+
+ 
+
+The
+Company does not believe other recently issued but not yet effective accounting standards, if currently adopted, would have a material
+effect on the Company s audited consolidated balance sheets, statement of operations and comprehensive loss and statement of cash
+flows.
+
+ 
+
+NOTE
+4 – ACCOUNTS RECEIVABLE, NET
+
+ 
+
+Accounts
+receivable, net consists of the following:
+
+ 
+
+ 
+ 
+ As of 
+
+ 
+ 
+ March 31, 2025 
+ September 30, 2024 
+
+ 
+ 
+ (Unaudited) 
+ 
+
+ 
+ Accounts receivable 
+ $321,285 
+ $622,440 
+
+ 
+ Accounts receivable - unbilled 
+ 15,109 
+ - 
+
+ 
+ 
+ 336,394 
+ 622,440 
+
+ 
+ Less: allowance for expected credit loss 
+ (23,003) 
+ (26,838)
+
+ 
+ 
+ $313,391 
+ $595,602 
+
+ 
+
+ 
+
+Management
+has assessed uncollectable accounts receivable and assessed long outstanding accounts receivable to estimate the expected credit loss.
+The following table shows movement of expected credit loss:
+
+ 
+
+ 
+ 
+ As of 
+
+ 
+ 
+ March 31, 
+
+2025 
+ September 30, 2024 
+
+ 
+ 
+ 
+ 
+
+ 
+ Balance at beginning of the period 
+ $26,838 
+ $19,376 
+
+ 
+ Add: allowance for expected credit loss (recovery) for the period 
+ (3,800) 
+ 7,268 
+
+ 
+ Exchange rate differences 
+ (35) 
+ 194 
+
+ 
+ 
+ $23,003 
+ $26,838 
+
+ 
+
+ 
+
+We
+did not write off any accounts receivable during the six months ended March 31, 2025 and the year ended September 30, 2024.
+
+ 
+
+NOTE
+5 –INVESTMENT
+
+ 
+
+Equity
+method investment consists of the following:
+
+ 
+
+ 
+ Name of Company 
+ Place of Incorporation 
+ Attributable equity interest % 
+ Issued capital 
+ Principle Activities
+
+ 
+ Common People & Production Ltd. ("Common People") 
+ HKSAR 
+ 40 
+ $10,000 
+ Production for Events
+
+ 
+
+ 
+
+On
+October 31, 2024, Common People & Production Limited was incorporated under the laws of Hong Kong, with an issued capital of 10,000
+shares with par value of HK$1, to enhance production of the Company. MOHK owned 40% of this production company. MediaOn accounts for
+the operation results using the equity method because MediaOn can exercise significant influence, but not control, according to ASU 2016-01.
+
+ 
+
+Equity
+income in investee is $16,083 and $nil for the six months ended March 31, 2025 and March 31, 2024.
+
+ 
+
+NOTE
+6 – DEPOSITS, PREPAYMENTS AND OTHER RECEIVABLES, NET
+
+ 
+
+Deposits,
+prepayments and other receivables consist of the following:
+
+ 
+
+ 
+ 
+ As of 
+
+ 
+ 
+ March
+ 31, 
+
+2025
+ 
+ September 30, 
+
+2024 
+
+ 
+ 
+ (Unaudited) 
+ 
+
+ 
+ Other receivables 
+ 258,211 
+ 74,640 
+
+ 
+ Deposits and prepayments 
+ - 
+ 7,327 
+
+ 
+ Subscription receivable - Non-controlling interest 
+ 579 
+ 579 
+
+ 
+ Less: allowance for expected credit loss 
+ - 
+ - 
+
+ 
+ 
+ $258,790 
+ $82,546 
+
+ 
+
+ 
+
+Management
+has accessed the potential of realization of deposits, prepayments and other receivables to conclude that it was not necessary to provide
+allowance for expected credit loss of the captioned items.
+
+ 
+
+ F-14
+
+ 
+
+ 
+
+ 
+
+NOTE
+7 – PLANT AND EQUIPMENT, NET
+
+ 
+
+Plant
+and equipment, net consist of the following:
+
+ 
+
+ 
+ 
+ As of 
+
+ 
+ 
+ March 31,
+ 2025
+ 
+ September 30, 
+
+2024 
+
+ 
+ At cost: 
+ 
+ 
+
+ 
+ Computer equipment 
+ $25,504 
+ $24,450 
+
+ 
+ Furniture and fixtures 
+ 60,799 
+ 60,882 
+
+ 
+ Office equipment 
+ 3,803 
+ 3,808 
+
+ 
+ 
+ 90,106 
+ 89,140 
+
+ 
+ Less: accumulated depreciation 
+ (80,666) 
+ (78,770)
+
+ 
+ Total 
+ $9,440 
+ $10,370 
+
+ 
+
+ 
+
+Depreciation
+expense for the six months ended March 31, 2025 and 2024 was $2,003 and $2,194, respectively.
+
+ 
+
+NOTE
+8 –BANK BORROWINGS
+
+ 
+
+Bank
+borrowings consist of the following:
+
+ 
+
+ 
+ Bank 
+ Principle 
+ Period 
+ Interest Rate* 
+ Balance 
+
+ 
+ 
+ 
+ 
+ 
+ March 31, 2025 
+ September 30, 2024 
+
+ 
+ Hang Seng Bank Ltd. 
+ HK$2,566,000 
+$329,824 
+ September 26, 2020 – September 26, 2028 
+ Prime lending rate minus 2.25% 
+ $170,257 
+ $193,957 
+
+ 
+ Hang Seng Bank Ltd. 
+ HK$2,434,000 
+$312,857 
+ March 1, 2021 – March 31, 2029 
+ Prime lending rate minus 2.25% 
+ 188,024 
+ 210,242 
+
+ 
+ Hang Seng Bank Ltd. 
+ HK$1,000,000 
+$128,536 
+ July 14, 2021 –July 13, 2029 
+ Prime lending rate minus 2.25% 
+ 83,101 
+ 92,105 
+
+ 
+ Livi Bank 
+ HK$4,000,000 
+$514,145 
+ September 5, 2023 – September 5, 2026 
+ 0.38% monthly flatted 
+ 274,182 
+ 358,460 
+
+ 
+ Hang Seng Bank Ltd. 
+ HK$2,900,000 
+$372,755 
+ February 29, 2024 – February 28, 2034 
+ Prime lending rate minus 2.25% 
+ 373,613 
+ 373,264 
+
+ 
+ 
+ 
+ 
+ 
+ $1,089,177 
+ $1,228,028 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Less: Bank borrowings, non-current 
+ 
+ 
+ 
+ (770,531) 
+ (926,505)
+
+ 
+ Bank borrowings, current portion 
+ 
+ 
+ 
+ $318,646 
+ $301,523 
+
+ 
+
+ 
+
+*
+The Prime lending rate of Hong Kong is the lending rate charged by commercial banks from their most creditworthy customers. This prime
+lending rate will be adjusted by commercial banks according to the market interest rates.
+
+ 
+
+Bank
+borrowings repayment contractual commitments, principle and interests:
+
+ 
+
+ 
+ Twelve months ending March 31, 
+ USD 
+
+ 
+ 2025 
+ $341,473 
+
+ 
+ 2026 
+ 256,634 
+
+ 
+ 2027 
+ 171,796 
+
+ 
+ 2028 
+ 140,965 
+
+ 
+ 2029 and after 
+ 241,572 
+
+ 
+ Total 
+ $1,152,440 
+
+ 
+
+ 
+
+The
+bank borrowings were primarily obtained for general working capital.
+
+ 
+
+As
+of March 31, 2025 and September 30, 2024, the Company s bank borrowings contain a repayment on demand clause that provides the
+bank with an unconditional right to demand repayment at any time at its own discretion. These bank loans were secured by personal guarantee
+provided by one of the directors of the Company. The amounts due are based on scheduled repayment dates set out in the banking facilities
+letters and the subsequently revised repayment schedules. All the Company s bank loans from Hang Seng Bank carried variable interest
+at BLR minus 2.25% per annum. The bank loan from Livi Bank interest rate is 0.38% monthly flat rate.
+
+ 
+
+ F-15
+
+ 
+
+ 
+
+ 
+
+The
+effective interest rate for the six months ended March 31, 2025 and year ended September 30, 2024 for the Company s bank loans
+were 6.97% and 6.98% per annum, respectively. All the Company s bank borrowings are repayable on demand or with their
+respective last instalment repayable in the year of 2034.
+
+ 
+
+Interest
+expense on the bank loans totalled $26,731 and $32,458 during the 6 months ended March 31, 2025 and 2024, respectively.
+
+ 
+
+Banking
+Facilities
+
+ 
+
+The
+company has banking facilities with Hang Seng Bank Limited. The banking facilities were HK$8,900,000 and HK$6,000,000 (approximately
+$1,143,974 and $771,218 respectively) and they were fully utilized for the six months ended March 31, 2025
+and 2024. The interest rate is the Hong Kong Prime rate minus 2.25% per annum for Hong Kong Dollars. These bank borrowings are classified
+as current and non-current liabilities on the consolidated balance sheets.
+
+ 
+
+The
+securities provided under the Hang Seng Banking Facility include a guarantee and indemnity for an unlimited amount executed by Mr. Chan
+Shu Wai, Mr. Chan Chi Wai, Mr. Chu Wai Biu, Mr. Lam Ngai Hang Lawrence and Ms. Wong Wai Yan. They are the directors and shareholders
+of related parties.
+
+ 
+
+NOTE
+9 – PROMISSORY NOTES AND LOAN
+
+ 
+
+During
+2025, the Company obtain promissory notes from various independent individuals as followings:
+
+ 
+
+ 
+ Promissory Note Number 
+ Principle 
+ Date of Registered 
+ Maturity Date 
+ Interest Rate 
+
+ 
+ 
+ USD 
+ 
+ 
+ 
+
+ 
+ 001 
+ $150,000 
+ December 21, 2023 
+ December 20, 2025 
+ 30% p.a. 
+
+ 
+ 002 
+ 50,000 
+ December 21, 2023 
+ December 20, 2025 
+ 30% p.a. 
+
+ 
+ 003 
+ 100,000 
+ January 29, 2024 
+ January 28, 2026 
+ 30% p.a. 
+
+ 
+ 004 
+ 100,000 
+ January 29, 2024 
+ January 28, 2026 
+ 30% p.a. 
+
+ 
+ 005 
+ 100,000 
+ January 29, 2024 
+ January 28, 2026 
+ 30% p.a. 
+
+ 
+ 006 
+ 100,000 
+ March 11, 2024 
+ March 10, 2026 
+ 30% p.a. 
+
+ 
+ 007 
+ 100,000 
+ July 8, 2024 
+ July 7, 2026 
+ 30% p.a. 
+
+ 
+ Total 
+ $700,000 
+ 
+ 
+ 
+
+ 
+
+ 
+
+These
+notes shall bear interest at a rate of 30% per annum from the date of the loan until maturity date, or, if earlier, the date on which
+the entire principal balance outstanding is paid in full.
+
+ 
+
+On
+January 24, 2025, MOHK was granted a one-year renewable loan from an independent third party, JL Investments Capital Limited,
+amounting HK$2,000,000 ($257,073) with an interest rate of 24% per annum. The loan is pledged with 51% of total issued shares of
+MOHK and personally guarantee by Mr. Chan Shu Wai, our director. Further, the lender shall be awarded with free shares valued at
+$257,000 dividing by the IPO offering price from Mr. Chan Shu Wai.
+
+ 
+
+ 
+ Loan Number 
+ Principle 
+ Date of Registered 
+ Maturity Date 
+ Interest Rate
+
+ 
+ 
+ USD 
+ 
+ 
+ 
+
+ 
+ 001 
+ $(HK$
+ 2,000,000)
+ 257,073
+ 
+ January
+ 24, 2025 
+ January 23, 2026 
+ 24% p.a.
+
+ 
+
+ 
+
+ F-16
+
+ 
+
+ 
+
+ 
+
+Interest
+accrued and committed for the promissory Note:
+
+ 
+
+ 
+ Date of Agreement 
+ Receipt Date of Remittance 
+ Maturity Date 
+ Interest rate 
+ Contract Amount 
+ Interest Accrued 
+ Interest Accrued 
+
+ 
+ 
+ 
+ 
+ 
+ USD 
+ As of 
+
+ 31-Mar-25 
+ As of 
+
+ 30-Sep-24 
+
+ 
+ December 21, 2023 
+ December 21, 2023 
+ December 20, 2025 
+ 30% 
+ 150,000 
+ 57,576 
+ 35,138 
+
+ 
+ December 21, 2023 
+ December 21, 2023 
+ December 20, 2025 
+ 30% 
+ 50,000 
+ 19,192 
+ 11,712 
+
+ 
+ January 8, 2024 
+ January 29, 2024 
+ January 28, 2026 
+ 30% 
+ 100,000 
+ 35,178 
+ 20,219 
+
+ 
+ January 8, 2024 
+ January 29, 2024 
+ January 28, 2026 
+ 30% 
+ 100,000 
+ 35,178 
+ 20,219 
+
+ 
+ January 8, 2024 
+ January 29, 2024 
+ January 28, 2026 
+ 30% 
+ 100,000 
+ 35,178 
+ 20,219 
+
+ 
+ March 4, 2024 
+ March 11, 2024 
+ March 10, 2026 
+ 30% 
+ 100,000 
+ 31,726 
+ 16,767 
+
+ 
+ July 8, 2024 
+ July 8, 2024 
+ July 7, 2026 
+ 30% 
+ 100,000 
+ 21,945 
+ 6,986 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Total 
+ 700,000 
+ 235,973 
+ 131,260 
+
+ 
+
+ 
+
+*
+Interests are payable upon maturity. The promissory note holders are entitled to demand repayments after the Company has completed its
+public offering. The Company intends to repay the promissory notes within one year from the balance sheet date of September 30, 2024.
+
+ 
+
+NOTE
+10 – EQUITY
+
+ 
+
+Vizz
+Technology Limited, wholly owned under common control by Vizz Group (Holdings) Limited and original founders, holds 16,500,000
+Class B Ordinary Shares. The shareholders equity structure as of September 30, 2024 are presented after giving retroactive effect
+to the reorganization of the Company that was completed on July 29, 2024 and the one-for-two reverse stock split effected on September
+1, 2025. Immediately before and after reorganization, the Company, together with its wholly-owned subsidiaries, were effectively
+controlled by the same group of shareholders; therefore, for accounting purposes, the reorganization was accounted for as a recapitalization.
+
+ 
+
+Authorized
+Shares
+
+ 
+
+On September 1, 2025, the Company
+changed its authorized share capital from $40,000 divided into 300,000,000 Class A Ordinary Shares of a par value of $0.0001 each and
+100,000,000 Class B Ordinary Shares of a par value of $0.0001 each to $50,000 divided into 233,500,000 Class A Ordinary Shares of a par
+value of $0.0002 each and 16,500,000 Class B Ordinary Shares of a par value of $0.0002 each.
+
+ 
+
+As
+of the date of this report, the Company has 233,500,000 and 16,500,000 authorized ordinary shares of Class A and Class
+B respectively, both at a par value of US$0.0002 per share.
+
+ 
+
+Ordinary
+Shares
+
+ 
+
+On
+July 29, 2024, 7,000,000 ordinary shares of Class A (before the Reverse Stock Split) were issued to new investors for $70,000.
+
+ 
+
+On September 1, 2025, the Company
+effected a reverse stock split (the" Reverse Stock Split") of the Company s issued and outstanding Ordinary Shares
+at a split ratio of 1-for-2 such that every holder of Class A and Class B Ordinary Shares shall receive one share for every two shares
+of Ordinary shares held.
+
+ 
+
+As
+of the date of this report, the Company has 3,500,000 Class A Ordinary shares issued but not yet paid and 16,500,000
+Class B Ordinary Shares issued, fully paid and outstanding, in connection with the reorganization of the Company.
+
+ 
+
+As
+of March 31, 2025 and September 30, 2024, 3,500,000 Class A Ordinary Shares and 16,500,000 Class B Ordinary Shares
+were issued and outstanding.
+
+ 
+
+Dividends
+
+ 
+
+Holders
+of Class A Ordinary Shares and Class B Ordinary Shares are entitled to dividends when, as and if, declared by our board of directors.
+For the six months ended March 31, 2025 and 2024, the Company has not declared any dividends.
+
+ 
+
+Voting
+
+ 
+
+Holders
+of Class A Ordinary Shares are entitled to one (1) vote per share.
+
+ 
+
+Holders
+of Class B Ordinary Shares are entitled to twenty (20) votes per share.
+
+ 
+
+ F-17
+
+ 
+
+ 
+
+ 
+
+NOTE
+11 – EMPLOYEE BENEFIT PLANS
+
+ 
+
+The
+Company has a defined contribution pension scheme for its qualifying employees according to statutory requirement of Mandatory Provident
+Fund Scheme of Hong Kong. The scheme assets are held under a provident fund managed by an independent fund manager. The Company and its
+employees are each required to make contributions to the scheme calculated at 5% of the employees basic salaries on monthly basis.
+
+ 
+
+NOTE
+12 – ACCRUALS AND OTHER PAYABLE
+
+ 
+
+Accruals
+and other payable consists of the followings:
+
+ 
+
+ 
+ 
+ As of, 
+
+ 
+ 
+ March 31, 2025 
+ September 30, 2024 
+
+ 
+ Accruals: 
+ 
+ 
+
+ 
+ Salaries 
+ $71,272 
+ $73,512 
+
+ 
+ Legal and professional fee 
+ 191,920 
+ 247,016 
+
+ 
+ Others 
+ 11,483 
+ 17,978 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total: 
+ $274,675 
+ $338,506 
+
+ 
+
+ 
+
+*Others
+include courier, entertainment, MPF, marketing, printing, transportation, etc.
+
+ 
+
+ F-18
+
+ 
+
+ 
+
+ 
+
+NOTE
+13 – CONCENTRATIONS OF RISK
+
+ 
+
+Customers
+Concentrations
+
+ 
+
+The
+following table sets forth information as to each customer that accounted for top 10% or more of the Company s revenues for
+the six months ended March 31, 2025 and 2024. 
+
+ 
+
+ 
+ 
+ For the six months ended 
+
+ 
+ Customers 
+ March 31, 2025 
+ March 31, 2024 
+
+ 
+ 
+ Amount 
+ % to Revenue 
+ Amount 
+ % to Revenue 
+
+ 
+ Customer A 
+ $289,012 
+ 34.46 
+ $864,816 
+ 67.16 
+
+ 
+
+ 
+
+Accounts
+Receivable Contractions
+
+ 
+
+The
+following table sets forth information as to each customer that accounted for 10% or more of the Company s accounts receivable
+as of March 31, 2025 and September 30, 2024.
+
+ 
+
+ 
+ 
+ As of 
+
+ 
+ Accounts Receivable 
+ March 31, 2025 
+ September 30, 2024 
+
+ 
+ 
+ Amount 
+ % 
+ Amount 
+ % 
+
+ 
+ Trade Debtor A 
+ $139,965 
+ 43.56 
+ $176,985 
+ 28.43 
+
+ 
+ Trade Debtor B 
+ 15,885 
+ 4.94 
+ 111,863 
+ 17.97 
+
+ 
+ Trade Debtor C 
+ 56,028 
+ 17.44 
+ 75,541 
+ 12.14 
+
+ 
+ Trade Debtor D 
+ - 
+ - 
+ 68,518 
+ 11.01 
+
+ 
+ Total: 
+ $211,878 
+ 65.94 
+ $432,907 
+ 69.55 
+
+ 
+
+ 
+
+Suppliers
+Concentrations
+
+ 
+
+The
+following table sets forth information as to each supplier that accounted for 10% or more of the Company s purchase for the
+six months ended March 31, 2025 and 2024.
+
+ 
+
+ 
+ 
+ For the six months ended 
+
+ 
+ Suppliers 
+ March 31, 2025 
+ March 31, 2024 
+
+ 
+ 
+ Amount 
+ % to Cost of Revenue 
+ Amount 
+ % to Cost of Revenue 
+
+ 
+ Supplier A 
+ $62,359 
+ 19.12 
+ $12,009 
+ 3.04 
+
+ 
+ Supplier B 
+ 40,510 
+ 12.42 
+ - 
+ - 
+
+ 
+ Supplier C 
+ 7,015 
+ 2.15 
+ 45,060 
+ 11.42 
+
+ 
+ Supplier D 
+ 1,340 
+ 0.41 
+ 137,481 
+ 34.85 
+
+ 
+ Total: 
+ $111,224 
+ 34.10 
+ $194,550 
+ 49.31 
+
+ 
+
+ 
+
+Accounts
+Payable Contractions
+
+ 
+
+The
+following table sets forth information as to each supplier that accounted for 10% or more of the Company s accounts payable as
+of March 31, 2025 and September 30, 2024.
+
+ 
+
+ 
+ 
+ As of 
+
+ 
+ Accounts Payable 
+ March 31, 2025 
+ September 30, 2024 
+
+ 
+ 
+ Amount $ 
+ % 
+ Amount $ 
+ % 
+
+ 
+ Trade Creditor A 
+ 187,404 
+ 34.91 
+ 143,678 
+ 20.99 
+
+ 
+ Trade Creditor B 
+ 73,635 
+ 13.72 
+ 117,260 
+ 17.13 
+
+ 
+ Trade Creditor C 
+ 39,975 
+ 7.45 
+ 79,141 
+ 11.56 
+
+ 
+ Trade Creditor D 
+ 62,336 
+ 11.61 
+ 634 
+ 0.09 
+
+ 
+ Trade Creditor E 
+ - 
+ - 
+ 182,127 
+ 26.61 
+
+ 
+ Total: 
+ 363,350 
+ 67.69 
+ 522,840 
+ 76.38 
+
+ 
+
+ 
+
+NOTE
+14 – DISAGGREGATED REVENUES AND COSTS OF REVENUES
+
+ 
+
+The
+Company s main business operations are as below:
+
+ 
+
+ 
+ 
+ For the six months ended March 31, 
+
+ 
+ Total revenues as of 
+ 2025 
+ 2024 
+
+ 
+ Marketing campaigns 
+ $408,408 
+ $298,597 
+
+ 
+ Media placements 
+ 121,980 
+ 120,342 
+
+ 
+ Media rebates 
+ 298,535 
+ 868,797 
+
+ 
+ Total revenues 
+ $828,923 
+ $1,287,736 
+
+ 
+
+ 
+
+ 
+ 
+ For the six months ended March 31, 
+
+ 
+ Total cost of revenues as of 
+ 2025 
+ 2024 
+
+ 
+ Marketing campaigns 
+ $230,853 
+ $119,586 
+
+ 
+ Media placements 
+ - 
+ - 
+
+ 
+ Media rebates 
+ 95,278 
+ 274,955 
+
+ 
+ Total cost of revenue 
+ $326,131 
+ $394,541 
+
+ 
+
+ 
+
+The
+Company act as agent for media placement business that revenue was accounted for net agency income.
+
+ 
+
+ F-19
+
+ 
+
+ 
+
+ 
+
+NOTE
+15 – RISKS
+
+ 
+
+ 
+ A.
+ 
+ Credit
+ risk
+
+ 
+ 
+ 
+
+ 
+ 
+ Accounts
+ receivable
+
+ 
+ 
+ 
+
+ 
+ 
+ In
+ order to minimize the credit risk, the management of the Company has delegated a team responsible for determination of credit limits
+ and credit approvals. Other monitoring procedures are in place to ensure that follow-up action is taken to recover overdue debts.
+ Internal credit rating has been given to each category of debtors after considering aging, historical observed default rates, repayment
+ history and past due status of respective accounts receivable. Estimated loss rates are based on probability of default and loss
+ given default with reference to an external credit report and are adjusted for reasonable and supportable forward-looking information
+ that is available without undue costs or effort while credit-impaired trade balances were assessed individually. In this regard,
+ the directors consider that the Company s credit risk is significantly reduced. The maximum potential loss of accounts receivable
+ for the six months ended March 31, 2025 is $23,003 and for the year ended September 30, 2024 is $26,838, respectively.
+
+ 
+ 
+ 
+
+ 
+ 
+ Bank
+ balances
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ credit risk on liquid funds is limited because the counterparties are banks with high credit ratings assigned by international credit-rating
+ agencies. The Company is exposed to concentration of credit risk on liquid funds which are deposited with several banks with high
+ credit ratings.
+
+ 
+ 
+ 
+
+ 
+ 
+ Deposits
+ and other receivables
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ Company assessed the impairment for its other receivables individually based on internal credit rating and ageing of these debtors
+ which, in the opinion of the directors, have no significant increase in credit risk since initial recognition. Based on the impairment
+ assessment performed by the Company, the directors consider the loss allowance for deposits and other receivables as of March 31,
+ 2025 and September 30, 2024 is $NIL and $NIL, respectively.
+
+ 
+ 
+
+ 
+ B.
+ 
+ Interest
+ risk
+
+ 
+ 
+ 
+
+ 
+ 
+ Cash
+ flow interest rate risk
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ Company is exposed to cash flow interest rate risk through the changes in interest rates related mainly to the Company s variable-rates
+ short-term bank loans and bank balances.
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ Company currently does not have any interest rate hedging policy in relation to fair value interest rate risk and cash flow interest
+ rate risk. The directors monitor the Company s exposures on an ongoing basis and will consider hedging the interest rate should
+ the need arises.
+
+ 
+ 
+
+ 
+ C.
+ 
+ Supplier
+ risk
+
+ 
+ 
+ 
+
+ 
+ 
+ Media
+ rebate is one of our major revenue contributors. The Company is exposed to supplier concertation risk for the rebate incomes from
+ digital media platform(s).
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ Company s financial results may be negatively impact if our supplier(s) change their policy in media rebate payout method.
+
+ 
+ 
+
+ F-20
+
+ 
+
+ 
+
+ 
+
+ 
+ D.
+ Sensitivity
+ analysis
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ sensitivity analysis below has been determined assuming that a change in interest rates had occurred at the end of the reporting
+ period and had been applied to the exposure to interest rates for financial instruments in existence at that date. 1% increase or
+ decrease is used when reporting interest rate risk internally to key management personnel and represents management s assessment
+ of the reasonably possible change in interest rates.
+
+ 
+ 
+ 
+
+ 
+ 
+ If
+ interest rates had been 1% higher or lower and all other variables were held constant, the Company s post tax loss for the
+ six months ended March 31, 2025 and 2024 would have increased or have decreased by approximately $9,095 and $11,246
+ respectively.
+
+ 
+ 
+ 
+
+ 
+ E.
+ Foreign
+ currency risk
+
+ 
+ 
+ 
+
+ 
+ 
+ Foreign
+ currency risk is the risk that the holding of foreign currency assets will affect the Company s financial position as a result
+ of a change in foreign currency exchange rates.
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ Company s monetary assets and liabilities are mainly denominated in HK$, which are the same as the functional currencies of
+ the relevant group entities. Hence, in the opinion of the directors of the Company, the currency risk of $ is considered insignificant.
+ The Company currently does not have a foreign currency hedging policy to eliminate the currency exposures. However, the directors
+ monitor the related foreign currency exposure closely and will consider hedging significant foreign currency exposures should the
+ need arise. 
+
+ 
+ 
+
+NOTE
+16 – LEASES
+
+ 
+
+The
+Company has an operating lease for an office that we utilize under lease agreement with our holding company. The
+Company s lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company
+do not have finance lease.
+
+ 
+
+The
+following table includes supplemental cash flow and non-cash information related to leases:
+
+ 
+
+ 
+ 
+ March 31, 2025 
+ March 31, 2024 
+
+ 
+ Cash paid of amounts included in the measurement of lease liabilities: 
+ 
+ 
+
+ 
+ Operating cash outflows for operating leases 
+ $- 
+ $- 
+
+ 
+ Right-of-use assets obtained in exchange for lease obligations: 
+ 
+ 
+
+ 
+ Operating lease liabilities 
+ $168,203 
+ $249,864 
+
+ 
+
+ 
+
+The
+weighted average remaining lease terms and discount rates for all of operating lease as of March 31,2025 and March 31, 2024 are as
+follows:
+
+ 
+
+ 
+ 
+ March 31, 2025 
+ March 31, 2024 
+
+ 
+ Weighted average remaining lease terms – operating lease 
+ 2.42
+ years 
+ 2.92
+ years 
+
+ 
+ 
+ 
+ 
+
+ 
+ Weighted average discount rate – operating lease 
+ 4.41% 
+ 4.41%
+
+ 
+
+ 
+
+The
+following is a schedule of maturities of operating lease liabilities:
+
+ 
+
+Operating
+leases
+
+ 
+
+ 
+ Twelve months ending September 30, 
+ 
+
+ 
+ Remaining of 2025 
+ $30,849 
+
+ 
+ 2026 
+ 77,122 
+
+ 
+ 2027 and after 
+ 69,408 
+
+ 
+ Total future minimum lease payments 
+ 177,379 
+
+ 
+ Less: imputed interest 
+ (9,176)
+
+ 
+ Present value of operating lease liabilities 
+ $168,203 
+
+ 
+ Less: current portion 
+ (71,021)
+
+ 
+ Non-current portion 
+ $97,182 
+
+ 
+
+ 
+
+NOTE
+17 – RELATED PARTY TRANSACTIONS
+
+ 
+
+ 
+ 
+ 
+ Nature
+ of relationships with related parties
+
+ 
+ 
+
+ 
+
+ 
+ 
+
+ Name
+
+ 
+ Relationship
+ with the Group
+
+ 
+ Maxzer
+ Limited
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO
+
+ 
+ Madcradle
+ Online Limited
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO
+
+ 
+ MGV
+ Innovation Limited (formerly known as: Vizz Solutions Limited)
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO
+
+ 
+ Vizz
+ Technology Limited
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO
+
+ 
+ Vizz
+ Group (Holdings) Limited
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO
+
+ 
+ Timway
+ Limited
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO
+
+ 
+ MuseLife
+ Hong Kong Limited
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO
+
+ 
+ Unience
+ Limited
+ 
+ Under
+ the common control of Mr. Chan Shu Wai Jimmy, common director, shareholder and CFO and, Mr. Chan Chi Wai Jerry, common director,
+ shareholder and CEO
+
+ 
+ Mr.
+ Chan Shu Wai Jimmy
+ 
+ Common
+ director, shareholder and CFO
+
+ 
+ Mr.
+ Chan Chi Wai Jerry
+ 
+ Common
+ director, shareholder, chairman and CEO
+
+ 
+ Mr.
+ Chan Shu Kin Peter
+ 
+ Director
+ and shareholder of related party
+
+ 
+ 
+
+ F-21
+
+ 
+
+ 
+
+ 
+
+The
+summary of amount due from and due to related parties as the following:
+
+ 
+
+ 
+ 
+ 
+ Six months ended March 31,
+ 2025 
+ Year ended September 30,
+ 2024 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Due from related parties consist of the following: 
+ 
+ 
+ 
+
+ 
+ Due from related companies 
+ 
+ 
+ 
+
+ 
+ Maxzer Limited 
+ Amount due from related company 
+ - 
+ 109,418 
+
+ 
+ MGV Innovation Limited 
+ Amount due from related company 
+ 54,939 
+ 56,504 
+
+ 
+ Vizz Group (Holdings) Ltd. 
+ Amount due from shareholder 
+ 1,564,534 
+ 1,566,668 
+
+ 
+ 
+ 
+ $1,619,473 
+ $1,732,590 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Due to related parties consist of the following: 
+ 
+ 
+ 
+
+ 
+ Due to related companies: 
+ 
+ 
+ 
+
+ 
+ Madcradle Online Limited 
+ Amount due to related company 
+ $481,030 
+ $429,648 
+
+ 
+ Maxzer Limited 
+ Amount due to related company 
+ 26,337 
+ - 
+
+ 
+ Vizz Technology Limited 
+ Amount due to related company 
+ 439,194 
+ 496,060 
+
+ 
+ 
+ 
+ $946,561 
+ $925,708 
+
+ 
+ Due to directors: 
+ 
+ 
+ 
+
+ 
+ Chan Shu Wai 
+ Settlement of related companies and working capital 
+ $528,935 
+ $555,013 
+
+ 
+ Chan Chi Wai 
+ Working capital 
+ 65,571 
+ 76,508 
+
+ 
+ 
+ 
+ $594,506 
+ $631,521 
+
+ 
+
+ 
+
+ F-22
+
+ 
+
+ 
+
+ 
+
+In
+addition to the transactions and balances detailed elsewhere in these audited consolidated financial statements, the Company had the
+following transactions with related parties:
+
+ 
+
+ 
+ 
+ Six months ended March 31, 
+
+ 
+ 
+ 2025 
+ 2024 
+
+ 
+ 
+ 
+ 
+
+ 
+ Revenue from related parties 
+ $5,305 
+ $9,912 
+
+ 
+ Management fee accrued to Vizz Technology Limited 
+ $38,575 
+ $38,378 
+
+ 
+ Lease from related parties 
+ $46,290 
+ $67,928 
+
+ 
+ Lease termination expenses 
+ $- 
+ $21,847 
+
+ 
+ Cost of sales to related parties 
+ $5,642 
+ $693 
+
+ 
+
+ 
+
+The
+Company has entered a management fee agreement with Vizz Group ("Holdings") Limited with monthly payments, amounting to $6,429
+(HK$50,000) and $6,396 (HK$50,000) for the six months ended March 31, 2025 and 2024, respectively.
+
+ 
+
+The
+Company has entered into an internal office rental sharing agreement with its related parties, with Vizz Technologies Limited (Vizz Tech)
+acting as the centralized collection agent for other related parties. The premises are contracted by Vizz Group (Holdings) Ltd and Vizz
+Tech with the lessors. The first office space s lease period was from April 15, 2022 to December 14, 2023, with a monthly shared
+rent of $7,329 (HK$57,000). It was terminated on December 14, 2023, the termination expense was $21,847 (HK$170,775). The
+second office space s lease period was from September 1, 2023 to August 31, 2027, with a monthly shared rent and service charge
+of $7,715 (HK$60,000).
+
+ 
+
+NOTE
+18 – SUBSEQUENT EVENTS
+
+ 
+
+The
+Company evaluates subsequent events that have occurred after the financial statements are issued but before report issuance date. There
+are two types of subsequent events: (1) recognized, or those that provide additional evidence with respect to conditions that existed
+at the dates of the balance sheets, including the estimates inherent in the process of preparing financial statements, and (2) non-recognized,
+or those that provide evidence with respect to conditions that did not exist at the date of the balance sheet but arose subsequent to
+that date. The Company has analysed its operations subsequent to March 31, 2025 to the date of these consolidated financial
+statements were issued, and has determined that it does not have any material events to disclose other than the following:
+
+ 
+
+On September 1, 2025, the Company effected a reverse
+stock split (the" Reverse Stock Split") of the Company s issued and outstanding Ordinary Shares at a split ratio of
+1-for-2 such that every holder of Class A and Class B Ordinary Shares shall receive one share for every two shares of Ordinary shares
+held. After the Reverse Stock Split, the Company increased its authorized share capital from $40,000 divided into 300,000,000 Class A
+Ordinary Shares of a par value of $0.0001 each and 100,000,000 Class B Ordinary Shares of a par value of $0.0001 each to $50,000 divided
+into 233,500,000 Class A Ordinary Shares of a par value of $0.0002 each and 16,500,000 Class B Ordinary Shares of a par value of $0.0002
+each.
+
+ 
+
+ F-23
+
+ 
+
+ 
+
+ 
+
+MEDIAON GROUP INC.
+
+INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
+
+ 
+
+TABLE OF CONTENTS
+
+ 
+
+ 
+ 
+ Page
+
+ 
+ Report of Independent Registered Public Accounting Firm (PCOAB: 05854)
+ F-25
+
+ 
+ 
+ 
+
+ 
+ Consolidated Balance Sheets as of September 30, 2024 and 2023
+ F-26
+
+ 
+ 
+ 
+
+ 
+ Consolidated Statements of Operations and Comprehensive Income (Loss) for the Years Ended September 30, 2024 and 2023
+ F-27
+
+ 
+ 
+ 
+
+ 
+ Consolidated Statements of Changes in Shareholders Equity (Deficit) for the Years Ended September 30, 2024 and 2023
+ F-28
+
+ 
+ 
+ 
+
+ 
+ Consolidated Statements of Cash Flows for the Years Ended September 30, 2024 and 2023
+ F-29
+
+ 
+ 
+ 
+
+ 
+ Notes to Consolidated Financial Statements
+ F-30
+
+ 
+ 
+
+ F-24
+
+ 
+
+ 
+
+ 
+
+ 
+
+REPORT
+OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
+
+ 
+
+To
+the Board of Directors and Shareholders of MediaOn Group Inc.
+
+ 
+
+Opinion
+on the Consolidated Financial Statements
+
+ 
+
+We
+have audited the accompanying consolidated balance sheets of MediaOn Group Inc. (the "Company") as of September 30, 2024
+and 2023, and the related consolidated statements of operations and comprehensive income (loss), shareholders deficit, and cash
+flows for each of the years in the two-year period ended September 30, 2024, and the related notes (collectively referred to as the "consolidated
+financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial
+position of the Company as of September 30, 2024 and 2023, and the results of its operations and its cash flows for each of the years
+in the two-year period ended September 30, 2024, in conformity with accounting principles generally accepted in the United States of
+America.
+
+ 
+
+Going
+Concern Matter
+
+ 
+
+The
+accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed
+in Note 2 to the consolidated financial statements, the Company has suffered recurring losses from operation, and has significant negative
+working capital and accumulated deficit that raises substantial doubt about its ability to continue as a going concern. Management s
+plans regarding these matters are also described in Note 2 to the consolidated financial statements. The consolidated financial statements
+do not include any adjustments that might result from the outcome of this uncertainty.
+
+ 
+
+Basis
+for Opinion
+
+ 
+
+These
+consolidated financial statements are the responsibility of the Company s management. Our responsibility is to express an opinion
+on the Company s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public
+Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance
+with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
+
+ 
+
+We
+conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain
+reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.
+The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part
+of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing
+an opinion on the effectiveness of the Company s internal control over financial reporting. Accordingly, we express no such opinion.
+
+ 
+
+Our
+audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether
+due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence
+regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles
+used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
+We believe that our audits provide a reasonable basis for our opinion.
+
+ 
+
+ 
+
+We
+have served as the Company s auditor since 2024.
+
+ 
+
+Diamond
+Bar, California
+
+ 
+
+May
+12, 2025, except for Notes 3 and 12 as to which the date is July 3, 2025; and Notes 9 and 18 as to which the date is September 10,
+2025
+
+ 
+
+ F-25
+
+ 
+
+ 
+
+ 
+
+MEDIAON GROUP INC.
+
+CONSOLIDATED BALANCE SHEETS
+
+AS OF SEPTEMBER 30, 2024 AND 2023
+
+(Stated in US Dollars)
+
+ 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ ASSETS 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Cash 
+ $186,684 
+ $649,067 
+
+ 
+ Accounts receivable, net 
+ 595,602 
+ 1,019,015 
+
+ 
+ Deposits, prepayments and other receivables, net 
+ 82,546 
+ 332,768 
+
+ 
+ Deferred IPO costs 
+ 338,301 
+ - 
+
+ 
+ Total current assets 
+ 1,203,133 
+ 2,000,850 
+
+ 
+ 
+ 
+ 
+
+ 
+ Plant and equipment, net 
+ 10,370 
+ 8,930 
+
+ 
+ Right-of-use (ROU) asset – operating lease 
+ 217,435 
+ 416,469 
+
+ 
+ Due from related parties 
+ 1,732,590 
+ 2,576,240 
+
+ 
+ Deferred tax assets 
+ - 
+ 14,665 
+
+ 
+ Total non-current assets 
+ 1,960,395 
+ 3,016,304 
+
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL ASSETS 
+ $3,163,528 
+ $5,017,154 
+
+ 
+ 
+ 
+ 
+
+ 
+ LIABILITIES AND SHAREHOLDERS EQUITY (DEFICIT) 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ LIABILITIES 
+ 
+ 
+
+ 
+ CURRENT LIABILITIES 
+ 
+ - 
+
+ 
+ Bank borrowings – current 
+ $301,523 
+ $259,011 
+
+ 
+ Accounts payable 
+ 684,400 
+ 1,664,044 
+
+ 
+ Accruals and other payables 
+ 338,506 
+ 357,812 
+
+ 
+ Customer deposits 
+ 57,407 
+ 71,213 
+
+ 
+ Advances from channel agents 
+ 4,973 
+ 5,628 
+
+ 
+ Deferred revenue 
+ 149,555 
+ 200,365 
+
+ 
+ Due to related parties 
+ 925,708 
+ 573,964 
+
+ 
+ Lease liabilities - current 
+ 69,572 
+ 163,939 
+
+ 
+ Promissory notes 
+ 700,000 
+ - 
+
+ 
+ Interest payable to promissory notes 
+ 131,260 
+ - 
+
+ 
+ Total current liabilities 
+ 3,362,904 
+ 3,295,976 
+
+ 
+ 
+ 
+ 
+
+ 
+ NON-CURRENT LIABILITIES 
+ 
+ 
+
+ 
+ Bank borrowings – non-current 
+ 926,505 
+ 843,797 
+
+ 
+ Lease liabilities – non-current 
+ 140,945 
+ 259,076 
+
+ 
+ Deferred tax liabilities 
+ 35,881 
+ - 
+
+ 
+ Due to directors 
+ 631,521 
+ 2,377,856 
+
+ 
+ Total non-current liabilities 
+ 1,734,852 
+ 3,480,729 
+
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL LIABILITIES 
+ $5,097,756 
+ $6,776,705 
+
+ 
+ 
+ 
+ 
+
+ 
+ SHAREHOLDERS EQUITY (DEFICIT) 
+ 
+ 
+
+ 
+ Class A Ordinary share, par value $0.0002 each, 233,500,000 shares authorized; 3,500,000
+ shares and nil shares issued and outstanding as of September 30, 2024 and 2023, respectively # 
+ $700 
+ $- 
+
+ 
+ Class B Ordinary Shares, par value $0.0002 each, 16,500,000 shares authorized; 16,500,000 shares issued
+ and outstanding as of September 30, 2024 and 2023*# 
+ 3,300 
+ 3,300 
+
+ 
+ Additional paid-in capital 
+ 69,300 
+ - 
+
+ 
+ Subscription receivable 
+ (70,000) 
+ - 
+
+ 
+ Accumulated other comprehensive income 
+ 20,335 
+ 30,488 
+
+ 
+ Accumulated deficit 
+ (1,958,442) 
+ (1,793,339)
+
+ 
+ Total MediaOn Group Inc. shareholders deficit 
+ (1,934,807) 
+ (1,759,551)
+
+ 
+ 
+ 
+ 
+
+ 
+ Non-controlling interest 
+ 579 
+ - 
+
+ 
+ Total Shareholders deficit 
+ (1,934,228) 
+ (1,759,551)
+
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL LIABILITIES AND SHAREHOLDERS DEFICIT 
+ $3,163,528 
+ $5,017,154 
+
+ 
+
+ 
+
+# On September 1, 2025, the Company effected
+a reverse stock split (the" Reverse Stock Split") of the Company s issued and outstanding Ordinary Shares at a split
+ratio of 1-for-2 such that every holder of Class A and Class B Ordinary Shares shall receive one share for every two shares of Ordinary
+shares held. After the Reverse Stock Split, the Company increased its authorized share capital from $40,000 to $50,000 divided into 233,500,000
+Class A Ordinary Shares of a par value of $0.0002 and 16,500,000 Class B Ordinary Shares of a par value of $0.0002. All references to
+number of ordinary shares, and to per share information have been retroactively adjusted.
+
+ 
+
+*
+Retrospectively restated for effect of share recapitalization (Note 1)
+
+ 
+
+The
+accompanying notes are an integral part of these audited consolidated financial statements.
+
+ 
+
+ F-26
+
+ 
+
+ 
+
+ 
+
+MEDIAON GROUP INC.
+
+CONSOLIDATED STATEMENTS OF OPERATIONS
+
+AND COMPREHENSIVE INCOME (LOSS)
+
+FOR THE YEARS ENDED SEPTEMBER 30, 2024 AND 2023
+
+(Stated in US Dollars)
+
+ 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ 
+ 
+
+ 
+ Revenue 
+ $2,777,281 
+ $3,941,655 
+
+ 
+ Revenue - Related Party 
+ 27,094 
+ 24,460 
+
+ 
+ Total Revenue 
+ 2,804,375 
+ 3,966,115 
+
+ 
+ 
+ 
+ 
+
+ 
+ Costs and Expenses: 
+ 
+ 
+
+ 
+ Cost of revenues 
+ (1,168,851) 
+ (1,653,627)
+
+ 
+ Cost of revenues- Related Party 
+ (1,522) 
+ (7,683)
+
+ 
+ Marketing expenses 
+ (213,063) 
+ (16,835)
+
+ 
+ General and administrative expenses 
+ (1,137,313) 
+ (958,543)
+
+ 
+ General and administrative expenses- Related Party 
+ (177,403) 
+ (247,127)
+
+ 
+ Total costs and expenses 
+ (2,698,152) 
+ (2,883,815)
+
+ 
+ 
+ 
+ 
+
+ 
+ Operating profit 
+ 106,223 
+ 1,082,300 
+
+ 
+ 
+ 
+ 
+
+ 
+ Government subsidy 
+ - 
+ 16,934 
+
+ 
+ Interest income 
+ 1,980 
+ 1,308 
+
+ 
+ Sundry (expenses) income 
+ (21,859) 
+ 518 
+
+ 
+ Interest expenses 
+ (197,353) 
+ (21,652)
+
+ 
+ Exchange (loss) gain 
+ (3,713) 
+ 4,773 
+
+ 
+ Total other (expenses) income 
+ (220,945) 
+ 1,881 
+
+ 
+ 
+ 
+ 
+
+ 
+ (Loss) profit before taxes 
+ (114,722) 
+ 1,084,181 
+
+ 
+ 
+ 
+ 
+
+ 
+ Provision for income taxes 
+ (50,381) 
+ (23,275)
+
+ 
+ 
+ 
+ 
+
+ 
+ Net (loss) income 
+ $(165,103) 
+ $1,060,906 
+
+ 
+ 
+ 
+ 
+
+ 
+ Less: 
+ 
+ 
+
+ 
+ Net income attributable to non-controlling interest 
+ - 
+ - 
+
+ 
+ Other comprehensive loss 
+ (10,153) 
+ (6,800)
+
+ 
+ Net (loss) income attributable to MediaOn Group Inc. 
+ $(175,256) 
+ $1,054,106 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net (loss) income per share Class A shares, basic and diluted# 
+ $(0.01) 
+ $- 
+
+ 
+ Net (loss) income per share Class B shares, basic and diluted*# 
+ $(0.01) 
+ $0.06 
+
+ 
+ Basic and diluted weighted average shares outstanding 
+ 
+ 
+
+ 
+ Class A# 
+ 604,110 
+ - 
+
+ 
+ Class B*# 
+ 16,500,000 
+ 16,500,000 
+
+ 
+
+ 
+
+# On September 1, 2025, the Company effected
+a reverse stock split (the" Reverse Stock Split") of the Company s issued and outstanding Ordinary Shares at a split
+ratio of 1-for-2 such that every holder of Class A and Class B Ordinary Shares shall receive one share for every two shares of Ordinary
+shares held. All references to number of ordinary shares, and to per share information have been retroactively adjusted.
+
+ 
+
+*
+Retrospectively restated for effect of share recapitalization (Note 1)
+
+ 
+
+The
+accompanying notes are an integral part of these audited consolidated financial statements.
+
+ 
+
+ F-27
+
+ 
+
+ 
+
+ 
+
+MEDIAON GROUP INC.
+
+CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS 
+EQUITY (DEFICIT)
+
+FOR THE YEARS ENDED SEPTEMBER 30, 2023 AND 2024
+
+(Stated in US Dollars)
+
+ 
+
+ 
+ 
+ Class A Ordinary Share 
+ Class B Ordinary Share 
+ Additional 
+ 
+ 
+ Accumulated Other 
+ Total MediaOn Group Inc. 
+ Non- 
+ Total 
+
+ 
+ 
+ Number of 
+ Par 
+ Number of 
+ Par 
+ Paid-in 
+ Subscription 
+ Accumulated 
+ Comprehensive 
+ Sharholders 
+ Controlling 
+ Shareholders 
+
+ 
+ 
+ Shares# 
+ Value 
+ Shares*# 
+ Value 
+ Capital 
+ Receivable 
+ Deficits 
+ Income/(Loss) 
+ Deficit 
+ Interest 
+ Deficits 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ BALANCE, September 30, 2022* 
+ - 
+ $- 
+ 16,500,000 
+ $3,300 
+ $- 
+ $- 
+ $(2,854,245) 
+ $37,288 
+ $(2,813,657) 
+ $- 
+ $(2,813,657)
+
+ 
+ Net Income 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ 1,060,906 
+ - 
+ 1,060,906 
+ - 
+ 1,060,906 
+
+ 
+ Other Comprehensive Loss 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ (6,800) 
+ (6,800) 
+ - 
+ (6,800)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ BALANCE, September 30, 2023* 
+ - 
+ $- 
+ 16,500,000 
+ $3,300 
+ $- 
+ $- 
+ $(1,793,339) 
+ $30,488 
+ $(1,759,551) 
+ $- 
+ $(1,759,551)
+
+ 
+ Capital injection 
+ 3,500,000 
+ 700 
+ - 
+ - 
+ 69,300 
+ (70,000) 
+ - 
+ - 
+ - 
+ 579 
+ 579 
+
+ 
+ Net loss 
+ - 
+ - 
+ - 
+ - 
+ - 
+ 
+ (165,103) 
+ - 
+ (165,103) 
+ - 
+ (165,103)
+
+ 
+ Other Comprehensive Loss 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ 
+ (10,153) 
+ (10,153) 
+ - 
+ (10,153)
+
+ 
+ BALANCE, September 30, 2024 
+ 3,500,000 
+ $700 
+ 16,500,000 
+ $3,300 
+ $69,300 
+ $(70,000) 
+ $(1,958,442) 
+ $20,335 
+ $(1,934,807) 
+ $579 
+ $(1,934,228)
+
+ 
+
+ 
+
+# On September 1, 2025, the Company effected
+a reverse stock split (the" Reverse Stock Split") of the Company s issued and outstanding Ordinary Shares at a split
+ratio of 1-for-2 such that every holder of Class A and Class B Ordinary Shares shall receive one share for every two shares of Ordinary
+shares held. All references to number of ordinary shares, and to per share information have been retroactively adjusted.
+
+*
+Retrospectively restated for effect of share recapitalization (Note 1)
+
+ 
+
+The
+accompanying notes are an integral part of these audited consolidated financial statements.
+
+ 
+
+ F-28
+
+ 
+
+ 
+
+ 
+
+MEDIAON GROUP INC.
+
+CONSOLIDATED STATEMENTS OF CASH FLOWS
+
+FOR THE YEARS ENDED SEPTEMBER 30, 2024 AND 2023
+
+(Stated in US Dollars)
+
+ 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ 
+ 
+
+ 
+ CASH FLOWS FROM OPERATING ACTIVITIES 
+ 
+ 
+
+ 
+ Net (Loss) Income from continuing operations 
+ $(114,722) 
+ $1,084,181 
+
+ 
+ 
+ 
+ 
+
+ 
+ Adjustments to reconcile net profit to net cash provided by (used in) operating activities: 
+ 
+ 
+
+ 
+ Depreciation 
+ 4,832 
+ 5,628 
+
+ 
+ Non-cash lease expense 
+ 12,567 
+ 8,846 
+
+ 
+ Allowance for doubtful accounts 
+ 7,268 
+ 36 
+
+ 
+ Changes in assets and liabilities: 
+ 
+ 
+
+ 
+ ROU operating lease assets 
+ 201,208 
+ (203,554)
+
+ 
+ Accounts receivable 
+ 398,902 
+ 47,622 
+
+ 
+ Deposits, prepayments and other receivables 
+ 252,605 
+ 5,521 
+
+ 
+ Amounts due from related companies 
+ 859,242 
+ (1,537,048)
+
+ 
+ Accounts payable 
+ (987,301) 
+ 296,519 
+
+ 
+ Accruals and other payables 
+ (22,016) 
+ 142,728 
+
+ 
+ Amount due to related parties 
+ 345,272 
+ (294,019)
+
+ 
+ Lease liabilities 
+ (227,214) 
+ 201,252 
+
+ 
+ Deferred revenue 
+ (52,105) 
+ (27,594)
+
+ 
+ Deposit revenue 
+ (14,290) 
+ 4,186 
+
+ 
+ Deposit from channels 
+ (695) 
+ (3,296)
+
+ 
+ Amount due to directors 
+ (1,755,353) 
+ 150,410 
+
+ 
+ Interest payable to promissory notes 
+ 131,260 
+ - 
+
+ 
+ Net cash (used in) operating activities 
+ (960,540) 
+ (118,582)
+
+ 
+ 
+ 
+ 
+
+ 
+ CASH FLOWS FROM INVESTING ACTIVITIES 
+ 
+ 
+
+ 
+ Purchase of plant and equipment 
+ (6,194) 
+ (5,419)
+
+ 
+ Net cash (used in) investing activities 
+ (6,194) 
+ (5,419)
+
+ 
+ 
+ 
+ 
+
+ 
+ CASH FLOWS FROM FINANCING ACTIVITIES 
+ 
+ 
+
+ 
+ Proceeds from bank borrowings 
+ 371,190 
+ 510,790 
+
+ 
+ Repayments of bank borrowings 
+ (255,346) 
+ (101,121)
+
+ 
+ Deferred IPO costs 
+ (336,422
+) 
+ -
+ 
+
+ 
+ Proceeds from issuance of promissory notes 
+ 700,000 
+ - 
+
+ 
+ Net cash provided by financing activities 
+ 479,422 
+ 409,669 
+
+ 
+ 
+ 
+ 
+
+ 
+ Effect of exchange rate on cash 
+ 24,929 
+ 891 
+
+ 
+ Net (decrease) increase in cash 
+ (462,383) 
+ 286,559 
+
+ 
+ Cash and cash equivalents, beginning of year 
+ 649,067 
+ 362,508 
+
+ 
+ Cash and cash equivalents, end of year 
+ $186,684 
+ $649,067 
+
+ 
+ 
+ 
+ 
+
+ 
+ Supplementary cash flow information: 
+ 
+ 
+
+ 
+ Taxes paid 
+ $- 
+ $- 
+
+ 
+ Interest paid 
+ $66,093 
+ $21,652
+ 
+
+ 
+
+ 
+
+ F-29
+
+ 
+
+ 
+
+ 
+
+NOTE 1 – ORGANIZATION AND PRINCIPAL ACTIVITIES
+
+ 
+
+MediaOn Group Inc. ("MEON",
+"MediaOn" or the "Company") was incorporated in the Cayman Islands ("Cayman") on March 20, 2024
+as an investment holding company. MEON is a parent holding company without operations.
+
+ 
+
+MediaOn Holdings Limited ("MOBVI"), a
+wholly owned subsidiary by the original common control shareholders, was incorporated in the British Virgin Islands ("BVI")
+on March 20, 2024. MOBVI has 1 (one) ordinary share issued and outstanding with a par value of $1. MOBVI is an investment holding company
+with no operations.
+
+ 
+
+MediaOn Limited ("MOHK"), a wholly
+owned private company limited by shares incorporated on July 27, 2011. MOHK. MOHK has 1,000 ordinary shares issued and outstanding
+with a par value of HK$1. MOHK is our primary operating subsidiary.
+
+ 
+
+Mosaic Creative Company Limited ("Mosaic"),
+a 55% owned private company limited by shares incorporated on August 27, 2024 under the laws of Hong Kong. Mosaic has 10,000 ordinary
+shares issued and outstanding with a par value of HK$1. Mosaic will be our operating subsidiary for creative business.
+
+ 
+
+The Company together with its subsidiaries (collective
+the "Group") conducts its primary operations through its indirectly wholly-owned subsidiaries MediaOn Limited ("MOHK")
+and 55% owned subsidiary Mosaic Creative Company Limited ("Mosaic").
+
+ 
+
+MOHK manages a network of digital media which create
+and publish contents to internet search engines and social media platforms such as Yahoo, Google, Facebook, YouTube, Instagram, LinkedIn
+and Xiaohongshu, and online to offline ("O2O") events for various clients from non-governmental organization ("NGO")
+to small and medium enterprises ("SME"). We also provide our clients artificial intelligent interactive and multimedia creations.
+Additionally, we will provide customized media services which includes digital outdoor marketing.
+
+ 
+
+Reorganization
+
+ 
+
+The Reorganization was completed on July
+29, 2024 through a series of planned transactions. As a result of the Reorganization, the Company has become the holding company for all
+previously mentioned entities.
+
+ 
+
+Immediately before the Reorganization, MOHK
+was owned and commonly controlled by Vizz Digital Group Limited and its shareholders, which is 100% owned by Vizz Group (Holdings) Limited
+and common control shareholders, and functioned as the sole operational entity.
+
+ 
+
+On March 20, 2024, MEON was established as
+an exempted company with limited liability in the Cayman Islands, with the sole purpose of acting as holding company for the Group. On
+March 20, 2024, MOBVI was established as intermedium holding company for MOHK.
+
+ 
+
+On July 29, 2024, 100% ownership of MOHK
+was acquired from Vizz Digital Group Limited by MOBVI. Tech Vision Investments Limited, a BVI company 100% owned by Vizz Technology Limited
+and common control shareholders and 100% indirectly owned by Vizz Technology Limited and common control shareholders, established on July
+29, 2024, which was allotted shares of MEON to indirectly owned MOBVI. On the same day, 100% ownership of MOBVI was transferred to MEON.
+Both MEON and MOBVI served as a holding company and had not engaged in any business activities.
+
+ 
+
+Immediately before and after the Reorganization,
+MEON, MOBVI, and MOHK remained under common control of a group of shareholders. Consequently, the Reorganization is classified
+as a common control transaction under ASC 805-50.
+
+ 
+
+On August 27, 2024, Mosaic Creative Company
+Limited ("Mosaic") a private company limited by shares was incorporated under the laws of Hong Kong for the focus on creative
+business. On the day of these financial statements, Mosaic has started business.
+
+ 
+
+Following this, the consolidation of the
+Company and its subsidiaries has been accounted for at historical cost and prepared on the basis as if the aforementioned transactions
+had become effective as of the beginning of the first period presented in these consolidated financial statements. Results of operations
+for the periods presented comprise those of the previously separate entities combined from the beginning of the period to the end of the
+period, eliminating the effects of intra-entity transactions.
+
+ 
+
+The following chart summarizes our corporate structure:
+
+ 
+
+ 
+
+The accompanying audited consolidated financial statements
+reflect the activities of the Company, and each of the following entities:
+
+ 
+
+ 
+ Name of Company
+ 
+ Place of
+Incorporation
+ 
+ Attributable
+equity
+interest %
+ 
+ 
+ Issued capital
+ 
+ Principle Activities
+
+ 
+ MediaOn Holdings Limited ("MOBVI")
+ 
+ BVI
+ 
+ 
+ 100
+ 
+ 
+ $
+ 1,000
+ 
+ Holding Company
+
+ 
+ MediaOn Limited ("MOHK")
+ 
+ HKSAR
+ 
+ 
+ 100
+ 
+ 
+ $
+ 128
+ 
+ Media Services
+
+ 
+ Mosaic Creative Co., Ltd. ("Mosaic")
+ 
+ HKSAR
+ 
+ 
+ 55
+ 
+ 
+ $
+ 1,282
+ 
+ Creative Business
+
+ 
+ 
+
+ F-30
+
+ 
+
+ 
+
+ 
+
+NOTE 2 – LIQUIDITY AND GOING CONCERN
+
+ 
+
+The Company s assessment of going concern considerations
+is required to be made in accordance with ASU 2014-15, "Disclosures of Uncertainties about an Entity s Ability to Continue
+as a Going Concern".
+
+ 
+
+As indicated in the accompanying consolidated financial
+statements, the Company had a net loss of $165,103 and a net profit of $1,060,906 for years ended September 30, 2024 and 2023, respectively.
+The Company has negative cash flows from operating activities for both the years ended September 30, 2024 and 2023, and has significant
+working capital deficiency of $2,159,771 and accumulated deficits of $1,295,126 as of September 30, 2024. Management has evaluated its
+available cash balance against its working capital requirements and believes that its capital resources are insufficient to maintain
+its business operations for the next twelve months.
+
+ 
+
+The Company s profitability was negatively
+impacted by the ongoing slow resumption of economic activities, the Company s profit could be significantly reduced, and
+management may need to raise additional funds for working capital through (1) the possible sale of its equity securities (2) bank borrowings;
+(3) short-term borrowings from the shareholders or other related parties; and/or (4) proceed from public offering. In addition, the management
+has started costs and expenses procurements to decrease cash outflows. However, there is no assurance that the Company will be successful
+in accomplishing any of its aforementioned plans.
+
+ 
+
+Building on cost control initiatives, the Company
+is optimistic in generating sufficient operating cash flows to meet its working capital requirements for the year ending September
+30, 2025, however there can be no assurance that the Company can generate sufficient operating cash flows for the next twelve months.
+
+ 
+
+The accompanying consolidated financial statements
+have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and satisfaction
+of liabilities in the normal course of business. The accompanying consolidated financial statements do not include any adjustments
+related to the recoverability and or classification of the recorded asset amounts and or the classification of the liabilities that might
+be necessary should the Company be unable to continue as a going concern.
+
+ 
+
+NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING
+POLICIES
+
+ 
+
+Basis of presentation and principle of consolidation
+
+ 
+
+The accompanying consolidated financial statements have been prepared in
+accordance with accounting principles generally accepted in the United States ("U.S. GAAP") and pursuant to the rules and
+regulations of the Securities Exchange Commission ("SEC").
+
+ 
+
+These consolidated financial statements include the financial statements
+of the Company and its subsidiaries. All intercompany transactions and balances among the Company and its subsidiaries have been eliminated
+upon consolidation.
+
+ 
+
+Foreign currency translation
+
+ 
+
+The accompanying audited consolidated financial statements
+are presented in United States dollar ("$"). The functional currency of the Company is Hong Kong dollar ("HK$").
+MOHK s statement of operation and balance sheet are translated into $ from HK$ at HK$7.8127=$1.0 for statement of operation and
+at HK$7.7693=$1.0 for balance sheet for the fiscal year 2024 and at HK$7.831=$1.0 for statement of operation and at HK$7.8308=$1.0 for
+balance sheet for the fiscal year 2023.
+
+ 
+
+Our reporting currency is U.S. Dollars ("US$").
+We determine the functional currency of each of our international subsidiaries and their operating divisions based on the primary currency
+in which they operate. In cases where the functional currency is not US$, we recognize a cumulative translation adjustment created by
+the different rates we apply to current period income or loss and the balance sheet. For each subsidiary, we apply the average functional
+exchange rate to its income or loss and the year-end functional exchange rate to translate the balance sheet.
+
+ 
+
+ F-31
+
+ 
+
+ 
+
+ 
+
+Use of estimates
+
+ 
+
+The preparation of the audited consolidated financial
+statements in conformity with accounting principles generally accepted in the United States of America ("US GAAP"), requires
+management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets
+and liabilities at the date of the audited consolidated financial statements and the reported amounts of revenues and expenses during
+the reporting periods.
+
+ 
+
+Significant accounting estimates required to be made
+by management which reflected in the Company s consolidated financial statements include the useful lives of property and equipment,
+the collectability of accounts & fair value of long-lived assets, the discount rate of leases, and uncertain tax position.
+
+ 
+
+The Company evaluates its estimates and assumptions
+on an ongoing basis and its estimates on historical experience, current and expected future conditions and various other assumptions that
+management believes are reasonable under the circumstances based on the best information available to management at the time these estimates
+and assumptions are made. However, actual results could differ from these estimates.
+
+ 
+
+Cash
+
+ 
+
+The Company considers cash and bank deposit primarily
+of cash in accounts held at a financial institution.
+
+ 
+
+Leases
+
+ 
+
+The Company adopted ASU No. 2016-02 — Leases
+(Topic 842) since September 30, 2021, using a modified retrospective transition method permitted under ASU No. 2018-11. This transition
+approach provides a method for recording existing leases only at the date of adoption and does not require previously reported balances
+to be adjusted. The Company evaluates the contracts it enters into to determine whether such contracts contain leases at inception. A
+contract contains a lease if the contract conveys the right to control the use of identified property, plant or equipment for a period
+of time in exchange for consideration. At commencement, contracts containing a lease are further evaluated for classification as an operating
+or finance lease where the Company is a lessee.
+
+ 
+
+Operating Leases
+
+ 
+
+A lease for which substantially all the
+benefits and risks incidental to ownership remain with the lessor is classified by the lease as an operation lease. Operating leases are
+included in the line items right-of-use ("ROU") asset, lease liabilities in current and non-current in the consolidated balance
+sheet.
+
+ 
+
+ROU assets represent the Company s
+right to use an underlying asset for the lease term and lease liabilities represent its obligation to make lease payments arising from
+the lease. For operating leases, the Company measures its lease liabilities based on the present value of the total lease payments not
+yet paid discounted based on the more readily determinable of the rate implicit in the lease or its incremental borrowing rate, which
+is the estimated rate the Company would be required to pay for a collateralized borrowing equal to the total lease payments over the term
+of the lease. The Company uses its incremental borrowing rate based on the information available at lease commencement date in determining
+the present value of lease payments. The Company measures ROU assets based on the corresponding lease liability adjusted for payments
+made to the lessor at or before the commencement date, and initial direct costs it incurs under the lease. The Company begins recognizing
+lease expense when the lessor makes the underlying asset available to the Company. Lease expenses for lease payments are recognized on
+a straight-line basis over the lease term.
+
+ 
+
+For leases with lease term less than one
+year (short-term leases), the Company has elected not to recognize a lease liability or ROU asset on its consolidated balance sheet. Instead,
+it recognizes the lease payments as expenses on a straight-line basis over the lease term. Short-term lease costs are immaterial to its
+consolidated statements of operations and cash flows.
+
+ 
+
+In considering the accounting implications
+of a facility the Company subleased a properties to an independent third party with verbal agreement with landlord, the Company determined
+that it would be inappropriate to de-recognize the sublease based on the guidance in ASC 842-20-40-3, since the Company was not relieved
+of the Company s primary obligation under the original lease when we assigned it to the independent third party. As such, the Company
+did not consider this to be a termination of the lease, and instead, the Company separately accounts for the original lease and sublease.
+As a result, and after assessing the recoverability of the related ROU asset, there was no change to our Operating lease assets or liabilities
+as a result of the assignment of this lease, and the Company continued to account for the lease as an operating lease in accordance with
+ASC 842-20-35-14.
+
+ 
+
+Deposits and prepayments
+
+ 
+
+The Company makes a deposit payment to suppliers for
+the procurement of products and services. Upon physical receipt and inspection of products or provision of services from suppliers, the
+applicable amount is recognized from deposits and prepayments to cost of revenues.
+
+ 
+
+Deferred IPO costs
+
+ 
+
+Deferred IPO costs consist of underwriting, legal,
+accounting and other expenses incurred through the balance sheet date that are directly related to the Initial Public Offering and that
+were charged to shareholders equity upon the completion of the Initial Public Offering. As of September 30, 2024 and September
+30, 2023, the Company had deferred IPO costs of $338,301 and $nil, respectively.
+
+ 
+
+ F-32
+
+ 
+
+ 
+
+ 
+
+NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING
+POLICIES (CONTINUED)
+
+ 
+
+Plant
+and equipment, net
+
+ 
+
+Plant
+and equipment are carried at cost less accumulated depreciation. Depreciation is provided over their estimated useful lives, using the
+straight-line method. The Company typically applies a salvage value of 0%. The salvage value, the useful life of assets, and methods
+of depreciation are reviewed at the end of each fiscal year, and adjusted prospectively, where applicable. The Company reviewed the useful
+life of property, plant and equipment in 2024 and no significant changes were deemed necessary. The estimated useful lives of the plan
+and equipment are as follows:
+
+ 
+
+ 
+ Furniture
+ and fixtures
+ 
+ 3-5
+ years
+
+ 
+ Office
+ equipment
+ 
+ 3-5
+ years
+
+ 
+ Computer
+ equipment
+ 
+ 3-5
+ years
+
+ 
+ 
+
+The
+cost and related accumulated depreciation of assets sold or otherwise retired are eliminated from the accounts, and any gain or loss
+are included in the Company s results of operations. The costs of maintenance and repairs are recognized as incurred; significant
+renewals and betterments are capitalized.
+
+ 
+
+Accounting
+for the impairment of long-lived assets
+
+ 
+
+The
+Company annually reviews its long-lived assets for impairment or whenever events or changes in circumstances indicate that the carrying
+amount of assets may not be recoverable. Impairment may become obsolete from a difference in the industry, introduction of new technologies,
+or if the Company has inadequate working capital to utilize the long-lived assets to generate adequate profits. Impairment is present
+if the carrying amount of an asset is less than its expected future undiscounted cash flows.
+
+ 
+
+If
+an asset is considered impaired, a loss is recognized based on the amount by which the carrying amount exceeds the fair market value
+of the asset. Assets to be disposed of are reported lower the carrying amount or fair value fewer costs to selling.
+
+ 
+
+The
+Company did not identify impairment of long-lived assets for the years ended September 30, 2024 and 2023.
+
+ 
+
+Commitments
+and contingencies
+
+ 
+
+From
+time to time, the Company is a party to various legal actions arising in the ordinary course of business. The majority of these claims
+and proceedings related to or arise from commercial disputes. The Company first determine whether a loss from a claim is probable, and
+if it is reasonable to estimate the potential loss. The Company accrues costs associated with these matters when they become probable,
+and the amount can be reasonably estimated. Legal costs incurred in connection with loss contingencies are expensed as incurred. Also,
+the Company disclose a range of possible losses, if a loss from a claim is probable but the amount of loss cannot be reasonably estimated,
+which is in line with the applicable requirements of Accounting Standard Codification 450. The Company s management does not expect
+any liability from the disposition of such claims and litigation individually or in the aggregate would have a material adverse impact
+on the Company s consolidated financial position, results of operations and cash flows.
+
+ 
+
+Related
+parties
+
+ 
+
+The
+Company adopted ASC 850, Related Party Disclosures, for the identification of related parties and disclosure of related party transactions.
+
+ 
+
+Revenue
+recognition
+
+ 
+
+The
+Company follows the rules and guidance set out under ASC 606, Revenue from Contracts with Customers ("ASC 606"), when recognizing
+revenue from contracts with customers. The core principle of ASC 606 requires an entity to recognize revenues to depict the transfer
+of goods to customers in an amount that reflects the consideration that it expects to be entitled to receive in exchange for those goods
+recognized as performance obligations are satisfied. In accordance with ASC 606, revenues are recognized when the Company satisfies the
+performance obligations by delivering the promised goods to the customers, in an amount that reflects the consideration the Company expects
+to be entitled to in exchange for those goods. The following five steps are applied to achieve that core principle:
+
+ 
+
+ 
+ 
+ Step
+ 1:
+ Identify
+ the contract with the customer
+
+ 
+ 
+ Step
+ 2:
+ Identify
+ the performance obligations in the contract
+
+ 
+ 
+ Step
+ 3:
+ Determine
+ the transaction price
+
+ 
+ 
+ Step
+ 4:
+ Allocate
+ the transaction price to the performance obligations in the contract
+
+ 
+ 
+ Step
+ 5:
+ Recognize
+ revenue when the company satisfies a performance obligation.
+
+ 
+ 
+
+ F-33
+
+ 
+
+ 
+
+ 
+
+Revenue
+is primarily derived from: 1) media placements – for search engines and social media; 2) media rebates; and 3) marketing campaigns,
+which includes, but not limited to, i) online and offline marketing events; ii) search engine optimizations (SEO); iii) contents creative
+design and production; iv) web-site designs and maintenances; v) social media listening tools; vi) media placement execution supports;
+and vii) traditional TV commercials and outdoor billboards.
+
+ 
+
+For
+revenue arrangements with multiple distinct performance obligations, services promised in the contract are highly interrelated with each other
+and it s not separately identifiable from other promises in the contract. Therefore, all goods and services in the contract are
+exclusively accounted for as a single performance obligation.
+
+ 
+
+The
+Company evaluates if it is a principal or an agent in a transaction to determine whether revenue should be recorded on a gross or net
+basis. The Company is acting as the principal if it obtains control over the goods and services before they are transferred to customers.
+Generally, when the Company is primarily obligated in a transaction, is subject to inventory risk, has latitude in establishing prices,
+or has several but not all of these indicators, the Company acts as the principal and revenue is recorded on a gross basis. Generally,
+when the Company is not primarily obligated in a transaction, does not bear the inventory risk and does not have the ability to establish
+the price, the Company acts as the agent and revenue is recorded on a net basis.
+
+ 
+
+ 
+ 
+ 1.
+ Media
+ Placement
+
+ 
+
+ We
+ offer media planning, potential media spendings and performance services to our customers. The media placements are operated by our
+ suppliers, and we act as an agent in these transactions. The commissions and any related fulfilment fees we earn from these arrangements
+ are recognized when the services are rendered, which generally occurs upon the media placement occurred to the customers.
+
+ 
+
+ We recognize media placement revenue, net of media costs (our fees/commissions) according to the proportion of our obligations
+having been delivered for advertisement placements with media stated in our contracts with our clients, and confirmation
+of placement orders from relevant media.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 2.
+ Media
+ Rebates
+
+ 
+
+ We
+ earn the revenue from media suppliers when the total amount generated from media placements achieves the certain amount agreed by the
+ suppliers and us. Our progressive media rebates on the basis of media spendings starting from 20% and up to 30%. Variable consideration
+ for our media businesses includes rebate revenue and is recognized when it is probable that the media will be run, including when
+ it is not subject to cancellation by the client. Performance incentives are typically recognized in revenue over time.
+
+ 
+
+ We
+ recognize media rebates according to our media placement achievements agreed with media suppliers. We recognize media rebates at
+ relevant contracted achievement level, starting from 20% basis, basing on our records and reconcile with the media supplier every
+ month. When we have achieved a higher level of achievements, we will recognize additional media rebates basing on contract with
+ media supplier.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 3.
+ Marketing
+ Campaigns
+
+ 
+
+ Marketing
+ Campaigns include, but not limited to, i) online and offline marketing events; ii) search engine optimizations (SEO); iii) contents
+ creative design and production; iv) web-site designs and maintenances; v) social media listening tools; vi) media placement execution
+ supports; and vii) traditional TV commercials and outdoor billboards.
+
+ 
+
+ Revenue,
+ related to ongoing services for marketing such as search engine optimizations (SEO), web-site designs and maintenances, social media
+ listening tools, is recognized over time as services are provided.
+
+ 
+
+ Revenue,
+ related to online and offline marketing events, media placement execution supports, traditional TV commercials and outdoor billboards,
+ and contents creative design and production, is recognized upon completion of services.
+
+ 
+
+ 
+
+ F-34
+
+ 
+
+ 
+
+ 
+
+Cost of revenues
+
+ 
+
+Cost of revenues consist primarily of costs associated
+with the arrangements with media platforms. These mainly include costs related to inhouse creative and production of contents, channel
+agents share of rebate, etc. Cost of revenues also include actual product costs paid to suppliers and the cost of transportation
+to the Company s customers.
+
+ 
+
+Accounts receivable, net
+
+ 
+
+Accounts receivable, net includes amounts billed
+under the contract terms, normally 30 days. The amounts are stated at their net realizable value. The Company considers several
+factors in its estimate of the allowance, including knowledge of a client s financial condition, its historical collection experience,
+and other factors relevant to assessing the collectability of such receivables. Bad debts are written off against allowances. The Company
+maintains an allowance for expected credit loss to provide for the estimated number of receivables that will not be collected.
+
+ 
+
+Deferred revenue
+
+ 
+
+Deferred revenue includes amount billed to customer
+with receipts for which the aforementioned revenue recognition criteria have not yet been met.
+
+ 
+
+Deferred revenue is mainly unearned revenue related
+to direct media services, support services and events. Normal expected delivery period for our obligations is about 3 months.
+During the years ended September 30, 2024 and 2023, we recognized $149,555 and $200,365 of unearned revenue, respectively.
+
+ 
+
+Expected credit loss
+
+ 
+
+ASU No. 2016-13, Financial Instruments – Credit
+Losses (Topic 326): Measurement of Credit Losses on Financial Instruments requires entities to use a current lifetime expected credit
+loss methodology to measure impairments of certain financial assets. Using this methodology will result in earlier recognition of losses
+than under the current incurred loss approach, which requires waiting to recognize a loss until it is probable of having been incurred.
+There are other provisions within the standard that affect how impairments of other financial assets may be recorded and presented, and
+that expand disclosures. The Company adopted the new standard effective October 1, 2021, the first day of the Company s fiscal year
+and applied to accounts receivable and other financial instruments. The adoption of this guidance did not materially impact the net earning
+and financial position and has no impact on the cash flows.
+
+ 
+
+Advertising
+
+ 
+
+All advertising costs are expensed as incurred.
+
+ 
+
+Retirement benefits
+
+ 
+
+Retirement benefits in the form of mandatory government-sponsored
+defined contribution plans (Mandatory Provident Fund) are charged to either expense as incurred or allocated to wages as part of cost
+of revenues.
+
+ 
+
+Government subsidy
+
+ 
+
+Government subsidy for the purpose of giving
+immediate financial support to the Company with no future related costs or obligation is recognized upon receipt in the Company s
+consolidated statements of income (loss) and comprehensive income (loss).
+
+ 
+
+For the years ended September 30, 2024 and 2023,
+the Company received government subsidies income amounted to $nil and $16,934, respectively from the Hong Kong Government, and
+was included in other income of the consolidated statements of income and comprehensive income.
+
+ 
+
+Income taxes
+
+ 
+
+The Company recognizes deferred income tax assets
+or liabilities for expected future tax consequences of events recognized in the audited consolidated financial statements or tax returns.
+Under this method, deferred income tax assets or liabilities are determined based upon the difference between the audited consolidated
+financial statement and income tax bases of assets and liabilities using enacted tax rates expected to apply when the differences settle
+or become realized. Valuation allowances are provided when it is more likely than not that a deferred tax asset is not realizable or recoverable
+in the future.
+
+ 
+
+The Company determines that the tax position
+is more likely than not to be sustained and records the largest amount of benefit that is more likely than not to be realized when the
+tax position is settled. The Company recognizes interest and penalties, if any, related to uncertain tax positions in income tax
+expense.
+
+ 
+
+ F-35
+
+ 
+
+ 
+
+ 
+
+Comprehensive income (loss)
+
+ 
+
+The Company presents comprehensive income (loss) in
+accordance with ASC Topic 220, Comprehensive Income. ASC Topic 220 states that all items that are required to be recognized under
+accounting standards as components of comprehensive income (loss) be reported in the consolidated financial statements. The components
+of comprehensive income (loss) were the net income for the years and the foreign currency translation adjustments.
+
+ 
+
+Income/(Loss) per share
+
+ 
+
+The Company computes income/(loss) per share following
+ASC Topic 260, "Earnings per share." Basic income/(loss) per share is measured as the income/(loss) available to common shareholders
+divided by the weighted average common shares outstanding for the period. Diluted loss per share presents the dilutive effect on a per-share
+basis from the potential conversion of convertible securities or the exercise of options and or warrants; the dilutive impacts of potentially
+convertible securities are calculated using the as-if method; the potentially dilutive effect of options or warranties are computed using
+the treasury stock method. Potentially anti-dilutive securities (i.e., those that increase income per share or decrease loss per share)
+are excluded from diluted income/(loss) per share calculation. There were no potentially dilutive securities that were in-the-money that
+were outstanding during the years ended September 30, 2024 and 2023.
+
+ 
+
+Segment reporting
+
+ 
+
+ASC 280, "Segment Reporting", establishes
+standards for reporting information about operating segments on a basis consistent with the Company s internal organizational structure
+as well as information about geographical areas, business segments and major customers in financial statements for detailing the Company s
+business segments. The Company uses the "management approach" in determining reportable operating segments. The management
+approach considers the internal organization and reporting used by the Company s chief operating decision maker for making operating
+decisions and assessing performance as the source for determining the Company s reportable segments. Management, including the
+chief operating decision maker, reviews operation results by the revenue of different products or services. Based on management s
+assessment, the Company had three operating and reportable segments during the years presented as set out in Note 14.
+
+ 
+
+Financial instruments
+
+ 
+
+The Company s financial instruments, including
+cash and cash equivalents, accounts and other receivables, accounts and other payables, accrued liabilities, amounts due from (to) related
+parties, promissory notes payable and bank and other loans, have carrying amounts that approximate their fair values due to their short
+maturities. ASC Topic 820, "Fair Value Measurements and Disclosures" requires disclosing the fair value of financial instruments
+held by the Company. ASC Topic 825, "Financial Instruments" defines fair value and establishes a three-level valuation hierarchy
+for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The carrying amounts reported
+in the audited consolidated balance sheets for cash and cash equivalents, accounts and other receivables, accounts and other payables,
+accrued liabilities, amounts due from (to) related parties, promissory notes payable and bank and other loans each qualify as financial
+instruments and are a reasonable estimate of their fair values because of the short period between the origination of such instruments
+and their expected realization and their current market rate of interest. The three levels of valuation hierarchy are defined as follows:
+
+ 
+
+ 
+ 
+ 
+ Level 1 – inputs to the valuation methodology used quoted prices for identical assets or liabilities in active markets. 
+
+ 
+ 
+
+ 
+ 
+ 
+ Level 2 – inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and information that are observable for the asset or liability, either directly or indirectly, for substantially the financial instrument s full term. 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Level 3 – inputs to the valuation methodology are unobservable and significant to the fair value measurement. 
+
+ 
+
+ 
+
+ F-36
+
+ 
+
+ 
+
+ 
+
+Recent accounting pronouncements
+
+ 
+
+We
+qualify as an "emerging growth company", or EGC, pursuant to the Jumpstart Our Business Startups Act of 2012, as amended,
+or the JOBS Act. As an EGC, the Company does not need to comply with any new or revised financial accounting standards until such date
+that a private company is otherwise required to comply with such new or revised accounting standards. We will adopt the standards based
+on the extended transition period provided to private companies.
+
+ 
+
+In November 2023, the Financial Accounting Standards
+Board (FASB) issued Accounting Standards Update (ASU) No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment
+Disclosures (ASU 2023-07), which requires that an entity disclose significant segment expenses impacting profit and loss that are
+regularly provided to the chief operating decision maker. The update is required to be applied retrospectively to prior periods presented,
+based on the significant segment expense categories identified and disclosed in the period of adoption. This ASU guidance is effective
+for our financial reports on this prospectus for the year ended September 30, 2024, and subsequent interim periods, with early adoption
+permitted.
+
+ 
+
+In December 2023, the FASB issued ASU No. 2023-09,
+Improvements to Income Tax Disclosures (ASU 2023-09), which requires that an entity disclose specific categories in the effective
+tax rate reconciliation as well as provide additional information for reconciling items that meet a quantitative threshold. Further, this
+ASU requires certain disclosures of state versus federal income tax expense and taxes paid. This ASU is effective for our Annual Report
+on Form 20-F for the year ended September 30, 2025, with early adoption permitted. The Company does not expect the adoption of ASU 2023-09
+to have a material impact on its financial statements.
+
+ 
+
+In
+November 2024, the FASB issued ASU No. 2024-03, Disaggregation of Income Statement Expenses (Topic 220-40). The ASU requires more
+detailed disclosure for expenses. The ASU is effective for annual reporting periods beginning after December 15, 2026, with early adoption
+permitted. The amendments can be applied on either a prospective or retroactive basis. We are currently evaluating the ASU to determine
+its impact on our disclosures.
+
+ 
+
+The Company does not believe other recently issued
+but not yet effective accounting standards, if currently adopted, would have a material effect on the Company s audited
+consolidated balance sheets, statement of operations and comprehensive loss and statement of cash flows.
+
+ 
+
+NOTE 4 – ACCOUNTS RECEIVABLE, NET
+
+ 
+
+Accounts receivable, net consists of the following:
+
+ 
+
+ 
+ 
+ Years ended September 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ 
+ 
+
+ 
+ Accounts receivable 
+ $622,440 
+ $1,038,391 
+
+ 
+ Less: allowance for expected credit loss 
+ (26,838) 
+ (19,376)
+
+ 
+ 
+ $595,602 
+ $1,019,015 
+
+ 
+
+ 
+
+Management has assessed uncollectable accounts
+receivable and assessed long outstanding accounts receivable to estimate the expected credit loss. The following table shows movement
+of expected credit loss:
+
+ 
+
+ 
+ 
+ Years ended September 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ 
+ 
+
+ 
+ Balance at beginning of the year 
+ $19,376 
+ $19,293 
+
+ 
+ Add: allowance for expected credit loss for the year 
+ 7,268 
+ 36 
+
+ 
+ Exchange rate differences 
+ 194 
+ 47 
+
+ 
+ 
+ $26,838 
+ $19,376 
+
+ 
+
+ 
+
+We did not write off any accounts receivable during
+the years ended September 30, 2024 and 2023.
+
+ 
+
+NOTE 5 – DEPOSITS, PREPAYMENTS AND OTHER
+RECEIVABLES, NET
+
+ 
+
+Deposits, prepayments and other receivables consist
+of the following:
+
+ 
+
+ 
+ 
+ Years ended September 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ 
+ 
+
+ 
+ Other receivables 
+ 74,640 
+ 320,620 
+
+ 
+ Deposits and prepayments 
+ 7,327 
+ 12,148 
+
+ 
+ Subscription receivable - Non-controlling interest 
+ 579 
+ - 
+
+ 
+ Less: allowance for expected credit loss 
+ - 
+ - 
+
+ 
+ 
+ $82,546 
+ $332,768 
+
+ 
+
+ 
+
+Management has accessed the potential of realization
+of deposits, prepayments and other receivables to conclude that it was not necessary to provide allowance for expected credit loss of
+the captioned items.
+
+ 
+
+ F-37
+
+ 
+
+ 
+
+ 
+
+NOTE 6 – PLANT AND EQUIPMENT, NET
+
+ 
+
+Plant and equipment, net consist of the following:
+
+ 
+
+ 
+ 
+ Years ended September 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ At cost: 
+ 
+ 
+
+ 
+ Computer equipment 
+ $24,450 
+ $19,093 
+
+ 
+ Furniture and fixtures 
+ 60,882 
+ 59,389 
+
+ 
+ Office equipment 
+ 3,808 
+ 3,778 
+
+ 
+ 
+ 89,140 
+ 82,260 
+
+ 
+ Less: accumulated depreciation 
+ (78,770) 
+ (73,330)
+
+ 
+ Total 
+ $10,370 
+ $8,930 
+
+ 
+
+ 
+
+Depreciation expense for the years ended September
+30, 2024 and 2023 was $4,832 and $5,628, respectively.
+
+ 
+
+NOTE 7 –BANK BORROWINGS
+
+ 
+
+Bank borrowings consist of the following:
+
+ 
+
+ 
+ Bank
+ 
+ Principle
+ 
+ Period
+ 
+ Interest Rate*
+ 
+ Balance
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ September 30,
+2024
+ 
+ 
+ September 30,
+2023
+ 
+
+ 
+ Hang Seng Bank Ltd.
+ 
+ HK$2,566,000
+$330,274
+ 
+ September 26, 2020 – September 26, 2028
+ 
+ Prime lending rate minus 2.25%
+ 
+ $
+ 193,957
+ 
+ 
+ $
+ 237,319
+ 
+
+ 
+ Hang Seng Bank Ltd.
+ 
+ HK$2,434,000
+$313,284
+ 
+ March 1, 2021 – March 31, 2029
+ 
+ Prime lending rate minus 2.25%
+ 
+ 
+ 210,242
+ 
+ 
+ 
+ 246,317
+ 
+
+ 
+ Hang Seng Bank Ltd.
+ 
+ HK$1,000,000
+$128,712
+ 
+ July 14, 2021 –July 13, 2029
+ 
+ Prime lending rate minus 2.25%
+ 
+ 
+ 92,105
+ 
+ 
+ 
+ 108,369
+ 
+
+ 
+ Livi Bank
+ 
+ HK$4,000,000
+$514,847
+ 
+ September 5, 2023 – September 5, 2026
+ 
+ 0.38% monthly flatted
+ 
+ 
+ 358,460
+ 
+ 
+ 
+ 510,803
+ 
+
+ 
+ Hang Seng Bank Ltd.
+ 
+ HK$2,900,000
+$373,264
+ 
+ February 29, 2024 – February 28, 2034
+ 
+ Prime lending rate minus 2.25%
+ 
+ 
+ 373,264
+ 
+ 
+ 
+ -
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ $
+ 1,228,028
+ 
+ 
+ $
+ 1,102,808
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Less: Bank borrowings, non-current
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ (926,505
+ )
+ 
+ 
+ (843,797
+ )
+
+ 
+ Bank borrowings, current portion
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ $
+ 301,523
+ 
+ 
+ $
+ 259,011
+ 
+
+ 
+
+ 
+
+* The Prime lending rate of Hong Kong is the lending
+rate charged by commercial banks from their most creditworthy customers. This prime lending rate will be adjusted by commercial banks
+according to the market interest rates.
+
+ 
+
+Bank borrowings repayment contractual commitments,
+principle and interests:
+
+ 
+
+ 
+ Twelve months ending September 30, 
+ USD 
+
+ 
+ 2025 
+ $341,939 
+
+ 
+ 2026 
+ 341,939 
+
+ 
+ 2027 
+ 172,030 
+
+ 
+ 2028 
+ 172,030 
+
+ 
+ 2029 and after 
+ 301,455 
+
+ 
+ Total 
+ $1,329,393 
+
+ 
+
+ 
+
+The bank borrowings were primarily obtained for general
+working capital.
+
+ 
+
+As of September 30, 2024 and 2023, the Company s
+bank borrowings contain a repayment on demand clause that provides the bank with an unconditional right to demand repayment at any time
+at its own discretion. These
+bank loans were secured by personal guarantee provided by one of the directors of the Company. The amounts due are based on scheduled
+repayment dates set out in the banking facilities letters and the subsequently revised repayment schedules. All the Company s bank
+loans from Hang Seng Bank carried variable interest at BLR minus 2.25% per annum. The bank loan from Livi Bank interest rate is 0.38%
+monthly flat rate.
+
+ 
+
+ F-38
+
+ 
+
+ 
+
+ 
+
+The effective interest rate for the years ended September
+30, 2024 and 2023 for the Company s bank loans were 6.98% and 3.44% per annum, respectively. All the Company s bank borrowings
+are repayable on demand or with their respective last instalment repayable in the year of 2034 and 2029.
+
+ 
+
+Interest expense on the bank loans totaled
+$66,093 and $21,652 during the years ended September 30, 2024 and 2023, respectively.
+
+ 
+
+Banking Facilities
+
+ 
+
+The company has banking facilities with Hang
+Seng Bank Limited. The banking facilities were HK$8,900,000 and HK$6,000,000 (approximately $1,145,534 and $766,205 respectively) and
+they were fully utilized for the year ended September 30, 2024 and 2023. The interest rate is the Hong Kong Prime rate minus 2.25% per
+annum for Hong Kong Dollars. These bank borrowings are classified as current and non-current liabilities on the consolidated balance
+sheets.
+
+ 
+
+The securities provided under the Hang Seng
+Banking Facility include a guarantee and indemnity for an unlimited amount executed by Mr. Chan Shu Wai, Mr. Chan Chi Wai, Mr. Chu Wai
+Biu, Mr. Lam Ngai Hang Lawrence and Ms. Wong Wai Yan. They are the directors and shareholders of related parties.
+
+ 
+
+NOTE 8 – PROMISSORY NOTES
+
+ 
+
+During 2024, the Company obtain promissory notes from
+various independent individuals as followings:
+
+ 
+
+ 
+ Promissory Note Number
+ 
+ Principle
+ 
+ Date of Registered
+ 
+ Maturity Date
+ 
+ Interest Rate
+ 
+
+ 
+ 
+ 
+ USD
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 001
+ $
+ 150,000
+ 
+ December 21, 2023 
+ 
+ December 20, 2025
+ 
+ 30% p.a.
+ 
+
+ 
+ 002
+ 
+ 50,000
+ 
+ December 21, 2023 
+ 
+ December 20, 2025
+ 
+ 30% p.a.
+ 
+
+ 
+ 003
+ 
+ 100,000
+ 
+ January 29, 2024
+ 
+ January 28, 2026
+ 
+ 30% p.a.
+ 
+
+ 
+ 004
+ 
+ 100,000
+ 
+ January 29, 2024
+ 
+ January 28, 2026
+ 
+ 30% p.a.
+ 
+
+ 
+ 005
+ 
+ 100,000
+ 
+ January 29, 2024
+ 
+ January 28, 2026
+ 
+ 30% p.a.
+ 
+
+ 
+ 006
+ 
+ 100,000
+ 
+ March 11, 2024
+ 
+ March 10, 2026
+ 
+ 30% p.a.
+ 
+
+ 
+ 007
+ 
+ 100,000
+ 
+ July 8, 2024
+ 
+ July 7, 2026
+ 
+ 30% p.a.
+ 
+
+ 
+ Total
+ $
+ 700,000
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+These notes shall bear interest at a rate of
+30% per annum from the date of the loan until maturity date, or, if earlier, the date on which the entire principal balance outstanding
+is paid in full.
+
+ 
+
+Interest accrued and committed for the promissory
+Note:
+
+ 
+
+ 
+ Date of Agreement 
+ Receipt Date of Remittance 
+ Maturity Date 
+ Interest rate 
+ Contract Amount 
+ Interest
+Accrued
+ 
+
+ 
+ 
+ 
+ 
+ 
+ USD 
+ 30-Sep-24 
+
+ 
+ December 21, 2023 
+ December 21, 2023 
+ December 20, 2025 
+ 30% 
+ 150,000 
+ 35,138 
+
+ 
+ December 21, 2023 
+ December 21, 2023 
+ December 20, 2025 
+ 30% 
+ 50,000 
+ 11,712 
+
+ 
+ January 8, 2024 
+ January 29, 2024 
+ January 28, 2026 
+ 30% 
+ 100,000 
+ 20,219 
+
+ 
+ January 8, 2024 
+ January 29, 2024 
+ January 28, 2026 
+ 30% 
+ 100,000 
+ 20,219 
+
+ 
+ January 8, 2024 
+ January 29, 2024 
+ January 28, 2026 
+ 30% 
+ 100,000 
+ 20,219 
+
+ 
+ March 4, 2024 
+ March 11, 2024 
+ March 10, 2026 
+ 30% 
+ 100,000 
+ 16,767 
+
+ 
+ July 8, 2024 
+ July 8, 2024 
+ July 7, 2026 
+ 30% 
+ 100,000 
+ 6,986 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Total 
+ 700,000 
+ 131,260 
+
+ 
+
+ 
+
+* Interests are payable upon maturity. The
+promissory note holders are entitled to demand repayments after the Company has completed its public offering. The Company
+intends to repay the promissory notes within one year from the balance sheet date of September 30, 2024.
+
+ 
+
+NOTE 9 – EQUITY
+
+ 
+
+Vizz
+Technology Limited, wholly owned under common control by Vizz Group (Holdings) Limited and original founders, holds 16,500,000
+Class B Ordinary Shares. The shareholders equity structure as of September 30, 2024 are presented after giving retroactive effect
+to the reorganization of the Company that was completed on July 29, 2024 and the one-for-two reverse stock split effected on September
+1, 2025. Immediately before and after reorganization, the Company, together with its wholly-owned subsidiaries, were effectively
+controlled by the same group of shareholders; therefore, for accounting purposes, the reorganization was accounted for as a recapitalization.
+
+ 
+
+Authorized
+Shares
+
+ 
+
+On September 1, 2025, the Company changed its
+authorized share capital from $40,000 divided into 300,000,000 Class A Ordinary Shares of a par value of US$0.0001 each and 100,000,000
+Class B Ordinary Shares of a par value of US$0.0001 each to $50,000 divided into 233,500,000 Class A Ordinary Shares of a par value of
+US$0.0002 each and 16,500,000 Class B Ordinary Shares of a par value of US$0.0002 each.
+
+ 
+
+As
+of the date of this report, the Company has 233,500,000 and 16,500,000 authorized ordinary shares of Class A and Class
+B respectively, both at a par value of US$0.0002 per share.
+
+ 
+
+Ordinary
+Shares
+
+ 
+
+On
+July 29, 2024, 7,000,000 ordinary shares (before the Reverse Stock Split) of Class A were issued to new investors for $70,000.
+
+ 
+
+On September 1, 2025, the Company effected a
+reverse stock split (the" Reverse Stock Split") of the Company s issued and outstanding Ordinary Shares at a split
+ratio of 1-for-2 such that every holder of Class A and Class B Ordinary Shares shall receive one share for every two shares of Ordinary
+shares held.
+
+ 
+
+As of the date of this report, the Company has
+3,500,000 Class A Ordinary shares issued but not yet paid and 16,500,000 Class B Ordinary Shares issued, fully paid and outstanding,
+in connection with the reorganization of the Company.
+
+ 
+
+As
+of September 30, 2024 and 2023, 16,500,000 Class B Ordinary Shares were issued and outstanding. 3,500,000 Class A Ordinary
+Shares were issued and outstanding during the year 2024. 
+
+ 
+
+Dividends
+
+ 
+
+Holders of Class A Ordinary Shares and Class B Ordinary
+Shares are entitled to dividends when, as and if, declared by our board of directors. For the year ended September 30, 2024 and
+2023, the Company has not declared any dividends.
+
+ 
+
+Voting
+
+ 
+
+Holders of Class A Ordinary Shares are entitled to
+one (1) vote per share.
+
+ 
+
+Holders of Class B Ordinary Shares are entitled to
+twenty (20) votes per share.
+
+ 
+
+ F-39
+
+ 
+
+ 
+
+ 
+
+NOTE 10 – EMPLOYEE BENEFIT PLANS
+
+ 
+
+The Company has a defined contribution pension scheme
+for its qualifying employees according to statutory requirement of Mandatory Provident Fund Scheme of Hong Kong. The scheme assets are
+held under a provident fund managed by an independent fund manager. The Company and its employees are each required to make contributions
+to the scheme calculated at 5% of the employees basic salaries on monthly basis.
+
+ 
+
+ NOTE 11 – ACCRUALS AND OTHER PAYABLE
+
+ 
+
+Accruals and other payable consists of the followings:
+
+ 
+
+ 
+ 
+ Years ended September 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ Accruals: 
+ 
+ 
+
+ 
+ Salaries 
+ $73,512 
+ $51,465 
+
+ 
+ Legal and professional fee 
+ 247,016 
+ 293,254 
+
+ 
+ Others 
+ 17,978 
+ 13,093 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total: 
+ $338,506 
+ $357,812 
+
+ 
+
+ 
+
+*Others include courier, entertainment, MPF, marketing,
+printing, transportation, etc.
+
+ 
+
+NOTE 12 – PROVISION FOR INCOME TAXES
+
+ 
+
+The
+Company is incorporated in Cayman Islands and operate its business through wholly-owned subsidiaries incorporated in Hong Kong.
+
+ 
+
+The
+Cayman Islands currently levies no taxes on individuals or corporations based upon profits, income, gains or appreciation and there is
+no taxation in the nature of inheritance tax or estate duty. There are no other taxes likely to be material to us levied by the government
+of the Cayman Islands except for stamp duties which may be applicable on instruments executed in, or brought within the jurisdiction
+of the Cayman Islands. In addition, the Cayman Islands does not impose withholding tax on dividend payments.
+
+ 
+
+MOBVI
+is incorporated in British Virgin Islands and is not subject to tax on income or capital gains under current British Virgin Islands law.
+In addition, upon payments of dividends by these entities to their shareholders, no British Virgin Islands withholding tax will be imposed.
+
+ 
+
+Under
+the current Hong Kong Inland Revenue Ordinance, the Company s subsidiaries in Hong Kong are subject to profits tax at the rate
+of 8.25% on assessable profits up to HK$2,000,000; and 16.5% on any part of assessable profits over HK$2,000,000.
+
+ 
+
+Payments
+of dividends by our Hong Kong subsidiaries is not subject to any Hong Kong withholding tax.
+
+ 
+
+Details
+of income tax are as follows:
+
+ 
+
+ 
+ 
+ Years
+ ended September 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ 
+ 
+
+ 
+ Current
+ tax – Hong Kong 
+ 
+ 
+
+ 
+ Current
+ year provision 
+ $- 
+ $- 
+
+ 
+ Deferred
+ income tax expenses 
+ 50,381 
+ 23,275 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total
+ tax expenses for the year 
+ $50,381 
+ $23,275 
+
+ 
+
+ 
+
+ F-40
+
+ 
+
+ 
+
+ 
+
+The
+following tables provide the reconciliation of the differences between the statutory and effective tax expenses following as of September
+30, 2024 and 2023.
+
+ 
+
+ 
+ 
+ Years
+ ended September 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ 
+ 
+
+ 
+ (Loss)/profit
+ before tax 
+ $(114,722) 
+ $1,084,181 
+
+ 
+ Tax
+ at applicable rate 
+ $(18,929) 
+ $178,889 
+
+ 
+ Income
+ not subject to tax 
+ (1,407) 
+ (8,549)
+
+ 
+ Non-deductible
+ expenses 
+ 17,901 
+ 19,052 
+
+ 
+ Utilization
+ of previously unrecognized tax losses 
+ 45,086 
+ (166,117)
+
+ 
+ (Over)/
+ under deferred assets for previous year 
+ 7,730 
+ - 
+
+ 
+ Income
+ tax 
+ $50,381 
+ $23,275 
+
+ 
+
+ 
+
+The
+Company s statutory tax rate was as follows as of September 30, 2024 and 2023:
+
+ 
+
+ 
+ 
+ Years
+ ended September 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ Statutory
+ rates in HK SAR 
+ 16.5% 
+ 16.5%
+
+ 
+
+ 
+
+Deferred
+tax assets (liabilities) as of September 30, 2024 and 2023 consisted of the following:
+
+ 
+
+ 
+ 
+ Years
+ ended September 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ 
+ 
+
+ 
+ Deferred
+ tax assets: 
+ 
+ 
+
+ 
+ Accrued
+ expenses 
+ $- 
+ $38,736 
+
+ 
+ Deferred
+ tax liabilities: 
+ 
+ 
+
+ 
+ Deferred
+ revenue 
+ (9,724) 
+ (24,071)
+
+ 
+ Accrued
+ expenses 
+ (26,157) 
+ - 
+
+ 
+ Deferred
+ tax (liabilities)/ assets, net 
+ $(35,881) 
+ $14,665 
+
+ 
+
+ 
+
+Under
+relevant Hong Kong tax laws, a tax case is normally subject to investigation by the tax authority for up to 6 years of assessment prior
+to the current year of assessment, unless in a case of fraud or willful evasion, then the investigation can be extended to cover 10 years
+of assessment. As of September 30, 2024 and 2023, we had no open tax investigation from the tax authority.
+
+ 
+
+Unrecognized
+tax losses
+
+ 
+
+Deferred
+income tax assets are recognized for tax losses carried forward to the extent that recognized of the related tax benefits through future
+taxable profits is probable. The Company has unrecognized tax losses of approximately $164,831 (HK$1,280,625) as of September 30, 2024
+(2023: $275,536 (HK$2,157,671)) at the reporting date which can be carried forward and used to offset against future taxable income subject
+to meeting certain statutory requirements. The tax losses have no expiry date.
+
+ 
+
+ F-41
+
+ 
+
+ 
+
+ 
+
+NOTE 13 – CONCENTRATIONS OF RISK
+
+ 
+
+Customers Concentrations
+
+ 
+
+The following table sets forth information as to each
+customer that accounted for top 10% or more of the Company s revenues as of September 30, 2024 and 2023.
+
+ 
+
+ 
+ 
+ For the years ended 
+
+ 
+ Customers 
+ September 30, 2024 
+ September 30, 2023 
+
+ 
+ 
+ Amount 
+ % to Revenue 
+ Amount 
+ % to Revenue 
+
+ 
+ Customer A 
+ $1,186,018 
+ 42.29 
+ $3,078,799 
+ 77.63 
+
+ 
+ Customer B 
+ 569,976 
+ 20.32 
+ 239,470 
+ 6.04 
+
+ 
+ Total: 
+ $1,755,994 
+ 62.61 
+ $3,318,269 
+ 83.67 
+
+ 
+
+ 
+
+Accounts Receivable Contractions
+
+ 
+
+The following table sets forth information as to each
+customer that accounted for 10% or more of the Company s accounts receivable as of September 30, 2024 and 2023.
+
+ 
+
+ 
+ 
+ For the years ended 
+
+ 
+ Accounts Receivable 
+ September 30, 2024 
+ September 30, 2023 
+
+ 
+ 
+ Amount 
+ % 
+ Amount 
+ % 
+
+ 
+ Trade Debtor A 
+ $176,985 
+ 28.43 
+ $889,023 
+ 85.62 
+
+ 
+ Trade Debtor B 
+ 111,863 
+ 17.97 
+ 14,711 
+ 1.42 
+
+ 
+ Trade Debtor C 
+ 75,541 
+ 12.14 
+ 60,086 
+ 5.79 
+
+ 
+ Trade Debtor D 
+ 68,518 
+ 11.01 
+ - 
+ - 
+
+ 
+ Total: 
+ $432,907 
+ 69.55 
+ $963,820 
+ 92.83 
+
+ 
+
+ 
+
+Suppliers Concentrations
+
+ 
+
+The following table sets forth information as to each
+supplier that accounted for 10% or more of the Company s purchase as of September 30, 2024 and 2023.
+
+ 
+
+ 
+ 
+ For the years ended 
+
+ 
+ Suppliers 
+ September 30, 2024 
+ September 30, 2023 
+
+ 
+ 
+ Amount 
+ % to Cost of Revenue 
+ Amount 
+ % to Cost of Revenue 
+
+ 
+ Supplier A 
+ $233,029 
+ 19.91 
+ $- 
+ - 
+
+ 
+ Supplier B 
+ 227,423 
+ 19.43 
+ 10,343 
+ 0.62 
+
+ 
+ Supplier C 
+ 130,331 
+ 11.14 
+ 306,870 
+ 18.47 
+
+ 
+ Supplier D 
+ 24,361 
+ 2.08 
+ 266,989 
+ 16.07 
+
+ 
+ Supplier E 
+ - 
+ - 
+ 220,516 
+ 13.27 
+
+ 
+ Supplier F 
+ 4,673 
+ 0.40 
+ 175,159 
+ 10.54 
+
+ 
+ Total: 
+ $619,817 
+ 52.96 
+ $979,877 
+ 58.97 
+
+ 
+
+ 
+
+Accounts Payable Contractions
+
+ 
+
+The following table sets forth information as to each
+supplier that accounted for 10% or more of the Company s accounts payable as of September 30, 2024 and 2023.
+
+ 
+
+ 
+ 
+ For the years ended 
+
+ 
+ Accounts Payable 
+ September 30, 2024 
+ September 30, 2023 
+
+ 
+ 
+ Amount $ 
+ % 
+ Amount $ 
+ % 
+
+ 
+ Trade Creditor A 
+ 182,127 
+ 26.61 
+ - 
+ - 
+
+ 
+ Trade Creditor B 
+ 143,678 
+ 20.99 
+ 1,284,920 
+ 77.22 
+
+ 
+ Trade Creditor C 
+ 117,260 
+ 17.13 
+ - 
+ - 
+
+ 
+ Trade Creditor D 
+ 79,141 
+ 11.56 
+ 10,344 
+ 0.62 
+
+ 
+ Trade Creditor E 
+ 634 
+ 0.09 
+ 206,834 
+ 12.43 
+
+ 
+ Total: 
+ 522,840 
+ 76.38 
+ 1,502,298 
+ 90.27 
+
+ 
+
+ 
+
+NOTE 14 – DISAGGREGATED REVENUES
+AND COSTS OF REVENUES
+
+ 
+
+The Company s main business operations are
+as below:
+
+ 
+
+ 
+ 
+ Years ended September 30, 
+
+ 
+ Total revenues as of 
+ 2024 
+ 2023 
+
+ 
+ Marketing campaigns 
+ $1,397,391 
+ $704,004 
+
+ 
+ Media placements 
+ 206,411 
+ 185,153 
+
+ 
+ Media rebates 
+ 1,200,573 
+ 3,076,958 
+
+ 
+ Total revenues 
+ $2,804,375 
+ $3,966,115 
+
+ 
+
+ 
+
+ 
+ 
+ Years ended September 30, 
+
+ 
+ Total cost of revenues as of 
+ 2024 
+ 2023 
+
+ 
+ Marketing campaigns 
+ $852,354 
+ $364,327 
+
+ 
+ Media placements 
+ - 
+ - 
+
+ 
+ Media rebates 
+ 318,019 
+ 1,296,983 
+
+ 
+ Total cost of revenue 
+ $1,170,373 
+ $1,661,310 
+
+ 
+
+ 
+
+The Company act as agent for media placement business
+that revenue was accounted for net agency income.
+
+ 
+
+ F-42
+
+ 
+
+ 
+
+ 
+
+NOTE 15 – RISKS
+
+ 
+
+ 
+ A. 
+ Credit risk
+
+ 
+ 
+ 
+
+ 
+ 
+ Accounts receivable
+
+ 
+ 
+ 
+
+ 
+ 
+ In order to minimize the credit risk, the management of the Company has delegated a team responsible for determination of credit limits and credit approvals. Other monitoring procedures are in place to ensure that follow-up action is taken to recover overdue debts. Internal credit rating has been given to each category of debtors after considering aging, historical observed default rates, repayment history and past due status of respective accounts receivable. Estimated loss rates are based on probability of default and loss given default with reference to an external credit report and are adjusted for reasonable and supportable forward-looking information that is available without undue costs or effort while credit-impaired trade balances were assessed individually. In this regard, the directors consider that the Company s credit risk is significantly reduced. The maximum potential loss of accounts receivable for the year ended September 30, 2024 and 2023 is $26,838 and $19,376, respectively.
+
+ 
+ 
+ 
+
+ 
+ 
+ Bank balances
+
+ 
+ 
+ 
+
+ 
+ 
+ The credit risk on liquid funds is limited because the counterparties are banks with high credit ratings assigned by international credit-rating agencies. The Company is exposed to concentration of credit risk on liquid funds which are deposited with several banks with high credit ratings.
+
+ 
+ 
+ 
+
+ 
+ 
+ Deposits and other receivables
+
+ 
+ 
+ 
+
+ 
+ 
+ The Company assessed the impairment for its other receivables individually based on internal credit rating and ageing of these debtors which, in the opinion of the directors, have no significant increase in credit risk since initial recognition. Based on the impairment assessment performed by the Company, the directors consider the loss allowance for deposits and other receivables as of September 30, 2024 and 2023 is $NIL and $NIL, respectively.
+
+ 
+ 
+
+ 
+ B. 
+ Interest risk
+
+ 
+ 
+ 
+
+ 
+ 
+ Cash flow interest rate risk
+
+ 
+ 
+ 
+
+ 
+ 
+ The Company is exposed to cash flow interest rate risk through the changes in interest rates related mainly to the Company s variable-rates short-term bank loans and bank balances.
+
+ 
+ 
+ 
+
+ 
+ 
+ The Company currently does not have any interest rate hedging policy in relation to fair value interest rate risk and cash flow interest rate risk. The directors monitor the Company s exposures on an ongoing basis and will consider hedging the interest rate should the need arises.
+
+ 
+ 
+
+ 
+ C. 
+ Supplier risk
+
+ 
+ 
+ 
+
+ 
+ 
+ Media rebate is one of our major revenue contributors. The Company is exposed to supplier concertation risk for the rebate incomes from digital media platform(s).
+
+ 
+ 
+ 
+
+ 
+ 
+ The Company s financial results may be negatively impact if our supplier(s) change their policy in media rebate payout method.
+
+ 
+ 
+
+ F-43
+
+ 
+
+ 
+
+ 
+
+ 
+ D.
+ Sensitivity analysis
+
+ 
+ 
+ 
+
+ 
+ 
+ The sensitivity analysis below has been determined assuming that a change in interest rates had occurred at the end of the reporting period and had been applied to the exposure to interest rates for financial instruments in existence at that date. 1% increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management s assessment of the reasonably possible change in interest rates.
+
+ 
+ 
+ 
+
+ 
+ 
+ If interest rates had been 1% higher or lower and all other variables
+ were held constant, the Company s post tax loss for the years ended September 30, 2024 and 2023 would have increased or have
+ decreased by approximately $10,254 and $9,208 respectively.
+
+ 
+ 
+ 
+
+ 
+ E.
+ Foreign currency risk
+
+ 
+ 
+ 
+
+ 
+ 
+ Foreign currency risk is the risk that the holding of foreign currency assets will affect the Company s financial position as a result of a change in foreign currency exchange rates.
+
+ 
+ 
+ 
+
+ 
+ 
+ The Company s monetary assets and liabilities are mainly denominated in HK$, which are the same as the functional currencies of the relevant group entities. Hence, in the opinion of the directors of the Company, the currency risk of $ is considered insignificant. The Company currently does not have a foreign currency hedging policy to eliminate the currency exposures. However, the directors monitor the related foreign currency exposure closely and will consider hedging significant foreign currency exposures should the need arise. 
+
+ 
+ 
+
+NOTE 16 – LEASES
+
+ 
+
+The Company has lease agreements for office with our
+holding company. The Company s lease agreements do not contain any material residual value guarantees or material restrictive covenants.
+
+ 
+
+The following table includes
+supplemental cash flow and non-cash information related to leases:
+
+ 
+
+ 
+ 
+ September 30, 2024 
+ September 30, 2023 
+
+ 
+ Cash paid of amounts included in the measurement of lease liabilities: 
+ 
+ 
+
+ 
+ Operating cash outflows for operating leases 
+ $- 
+ $- 
+
+ 
+ Right-of-use assets obtained in exchange for lease obligations: 
+ 
+ 
+
+ 
+ Operating lease liabilities 
+ $210,517 
+ $423,015 
+
+ 
+
+ 
+
+The weighted average remaining lease terms and discount
+rates for all of operating lease and finance leases as of September 30, 2024 and 2023 are as follows:
+
+ 
+
+ 
+ 
+ September 30, 2024 
+ September 30, 2023 
+
+ 
+ Weighted-average remaining lease term (years): 
+ 
+ 
+
+ 
+ Operating lease 
+ 2.92 years 
+ 5.50 years 
+
+ 
+ 
+ 
+ 
+
+ 
+ Weighted average discount rate: 
+ 
+ 
+
+ 
+ Operating lease 
+ 4.41% 
+ 4.41%
+
+ 
+
+ 
+
+The following is a schedule of
+maturities of operating lease liabilities:
+
+ 
+
+Operating leases
+
+ 
+
+ 
+ Twelve months ending September 30, 
+ 
+
+ 
+ 2025 
+ $77,227 
+
+ 
+ 2026 
+ 77,227 
+
+ 
+ 2027 and after 
+ 69,505 
+
+ 
+ Total future minimum lease payments 
+ 223,959 
+
+ 
+ Less: imputed interest 
+ (13,442)
+
+ 
+ Present value of operating lease liabilities 
+ $210,517 
+
+ 
+ Less: current portion 
+ (69,572)
+
+ 
+ Non-current portion 
+ $140,945 
+
+ 
+
+ 
+
+NOTE 17 – RELATED PARTY TRANSACTIONS
+
+ 
+
+ Nature of relationships with related parties
+
+ 
+
+ 
+ 
+ 
+
+ Name
+
+ 
+ Relationship
+ with the Group
+
+ 
+ Maxzer Limited
+ 
+ Under the common control of Mr. Chan Shu Wai Jimmy, common director,
+ shareholder and CFO
+
+ 
+ Madcradle Online Limited
+ 
+ Under the common control of Mr. Chan Shu Wai Jimmy, common director,
+ shareholder and CFO
+
+ 
+ MGV Innovation Limited (formerly known as: Vizz Solutions Limited)
+ 
+ Under the common control of Mr. Chan Shu Wai Jimmy, common director,
+ shareholder and CFO
+
+ 
+ Vizz Technology Limited
+ 
+ Under the common control of Mr. Chan Shu Wai Jimmy, common director,
+ shareholder and CFO
+
+ 
+ Vizz Group (Holdings) Limited
+ 
+ Under the common control of Mr. Chan Shu Wai Jimmy, common director,
+ shareholder and CFO
+
+ 
+ Timway Limited
+ 
+ Under the common control of Mr. Chan Shu Wai Jimmy, common director,
+ shareholder and CFO
+
+ 
+ MuseLife Hong Kong Limited
+ 
+ Under the common control of Mr. Chan Shu Wai Jimmy, common director,
+ shareholder and CFO
+
+ 
+ Unience Limited
+ 
+ Under the common control of Mr. Chan Shu Wai Jimmy, common director,
+ shareholder and CFO and,
+ Mr. Chan Chi Wai Jerry, common director, shareholder and CEO
+
+ 
+ Mr. Chan Shu Wai
+ Jimmy
+ 
+ Common director, shareholder and CFO
+
+ 
+ Mr. Chan Chi Wai Jerry
+ 
+ Common director, shareholder, chairman and CEO
+
+ 
+ Mr. Chan Shu Kin Peter
+ 
+ Director and shareholder of related party
+
+ 
+ 
+
+ F-44
+
+ 
+
+ 
+
+ 
+
+The summary of amount due from and due to related
+parties as the following:
+
+ 
+
+ 
+ 
+ 
+ Years ended September 30, 
+
+ 
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Due from related parties consist of the following: 
+ 
+ 
+ 
+
+ 
+ Due from related companies 
+ 
+ 
+ 
+
+ 
+ Madcradle Online Limited 
+ Amount due from related company 
+ $- 
+ $834,957 
+
+ 
+ Maxzer Limited 
+ Amount due from related company 
+ 109,418 
+ 181,683 
+
+ 
+ MGV Innovation Limited 
+ Amount due from related company 
+ 56,504 
+ 30,776 
+
+ 
+ Vizz Group (Holdings) Ltd. 
+ Amount due from shareholder 
+ 1,566,668 
+ 1,528,824 
+
+ 
+ 
+ 
+ $1,732,590 
+ $2,576,240 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Due to related parties consist of the following: 
+ 
+ 
+ 
+
+ 
+ Due to related companies: 
+ 
+ 
+ 
+
+ 
+ Madcradle Online Limited 
+ Amount due to related company 
+ $429,648 
+ $- 
+
+ 
+ Vizz Technology Limited 
+ Amount due to related company 
+ 496,060 
+ 573,964 
+
+ 
+ 
+ 
+ $925,708 
+ $573,964 
+
+ 
+ Due to directors: 
+ 
+ 
+ 
+
+ 
+ Chan Shu Wai 
+ Settlement of related companies and working capital 
+ $555,013 
+ $2,248,218 
+
+ 
+ Chan Chi Wai 
+ Working capital 
+ 76,508 
+ 129,638 
+
+ 
+ 
+ 
+ $631,521 
+ $2,377,856 
+
+ 
+
+ 
+
+ F-45
+
+ 
+
+ 
+
+ 
+
+In addition to the transactions and balances detailed
+elsewhere in these audited consolidated financial statements, the Company had the following transactions with related parties:
+
+ 
+
+ 
+ 
+ Years ended September 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ 
+ 
+
+ 
+ Revenue from related parties 
+ $27,094 
+ $24,460 
+
+ 
+ Management fee accrued to Vizz Technology Limited 
+ $76,798 
+ $153,237 
+
+ 
+ Lease from related parties 
+ $100,605 
+ $93,890 
+
+ 
+ Lease termination expenses 
+ $21,859 
+ $- 
+
+ 
+ Cost of sales to related parties 
+ $1,522 
+ $7,683 
+
+ 
+
+ 
+
+The Company has entered a management fee agreement
+with Vizz Group ("Holdings") Limited with monthly payments, amounting to $6,400 (HK$50,000) and $12,770 (HK$100,000) for
+the years ended September 30, 2024 and 2023, respectively.
+
+ 
+
+The Company has entered into an internal office
+rental sharing agreement with its related parties, with Vizz Technologies Limited (Vizz Tech) acting as the centralized collection agent
+for other related parties. The premises are contracted by Vizz Group (Holdings) Ltd and Vizz Tech with the lessors. The first office
+space s lease period was from April 15, 2022 to December 14, 2023, with a monthly shared rent of $7,296
+(HK$57,000). It was terminated on December 14, 2023, the termination expense was $21,859 (HK$170,775). The second office space s
+lease period was from September 1, 2023 to August 31, 2027, with a monthly shared rent and service charge of $7,680 (HK$60,000).
+
+ 
+
+NOTE 18 – SUBSEQUENT EVENTS
+
+ 
+
+The Company evaluates subsequent events that have
+occurred after the financial statements are issued but before report issuance date. There are two types of subsequent events: (1) recognized,
+or those that provide additional evidence with respect to conditions that existed at the dates of the balance sheets, including the estimates
+inherent in the process of preparing financial statements, and (2) non-recognized, or those that provide evidence with respect to conditions
+that did not exist at the date of the balance sheet but arose subsequent to that date. The Company has analyzed its operations subsequent
+to September 30, 2024 to the date of these consolidated financial statements were issued, and has determined that it does not have any
+material events to disclose other than the following:
+
+ 
+
+On January 24, 2025, MOHK was granted a one-year
+renewable loan from an independent individual, JL Investments Capital Limited, amounting HK$2,000,000 (approximately $257,000) with an
+interest rate of 24% per annum. The loan is pledged with MOHK shares and personally guarantee by Mr. Chan Shu Wai, our director. Further,
+the lender shall be awarded with free shares valued at $257,000 dividing by the IPO offering price from Mr. Chan Shu Wai.
+
+ 
+
+On October 31, 2024, Common People & Production
+Limited was incorporated under the laws of Hong Kong, with an issued capital of 10,000 shares with par value of HK$1, to enhance production
+of the Company. MOHK owned 40% of this production company.
+
+ 
+
+On September 1, 2025, the Company effected a reverse
+stock split (the" Reverse Stock Split") of the Company s issued and outstanding Ordinary Shares at a split ratio of
+1-for-2 such that every holder of Class A and Class B Ordinary Shares shall receive one share for every two shares of Ordinary shares
+held. After the Reverse Stock Split, the Company increased its authorized share capital from $40,000 divided into 300,000,000 Class A
+Ordinary Shares of a par value of $0.0001 each and 100,000,000 Class B Ordinary Shares of a par value of $0.0001 each to $50,000 divided
+into 233,500,000 Class A Ordinary Shares of a par value of $0.0002 each and 16,500,000 Class B Ordinary Shares of a par value of $0.0002
+each.
+
+ 
+
+ F-46
+
+ 
+
+ 
+
+ 
+
+RESALE PROSPECTUS ALTERNATE PAGE
+
+ 
+
+MEDIAON GROUP INC.
+
+ 
+
+PRELIMINARY PROSPECTUS
+
+ 
+
+Through and including [ ],
+2026 (the 25th day after the date of this prospectus), all dealers effecting transactions in these securities, whether or not
+participating in this offering, may be required to deliver a prospectus. This is in addition to a dealer s obligation to deliver
+a prospectus when acting as an underwriter and with respect to their unsold allotments or subscriptions.
+
+ 
+
+The information in this prospectus is not complete
+and may be changed or supplemented. We may not sell these securities until the registration statement filed with the Securities and Exchange
+Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities
+in any jurisdiction where such offer or sale is not permitted.
+
+ 
+
+Subject to Completion, dated December 3,
+2025
+
+ 
+
+PRELIMINARY PROSPECTUS
+
+ 
+
+MEDIAON GROUP INC.
+
+ 
+
+1,600,000 Class A Ordinary Shares
+
+ 
+
+This prospectus relates to the
+resale of 1,000,000 Class A Ordinary Shares held by Rich Choice Ventures Limited and 600,000 Class A Ordinary Shares held
+by Distinctive Idea Enterprise Limited (collectively the "Resale Shareholders"). We will not receive any of the proceeds
+from the sale of Shares by the Resale Shareholders.
+
+ 
+
+The Resale Shareholders will
+not make any sales until the shares are listed on Nasdaq and they will sell their shares at market prices once trading of your shares
+begins. The 1,600,000 Ordinary Shares held by the Resale Shareholders that are being registered are not subject to lock-up agreements.
+Thereafter, any sales will occur at prevailing market prices or in privately negotiated prices. The distribution of securities offered
+hereby may be effected in one or more transactions that may take place in ordinary brokers transactions, privately negotiated
+transactions or through sales to one or more dealers for resale of such securities as principals. Usual and customary or specifically
+negotiated brokerage fees or commissions may be paid by the Resale Shareholders. No sales of the shares covered by this prospectus shall
+occur until the shares sold in our initial public offering begin trading on the Nasdaq.
+
+ 
+
+On [ ], 2025,
+a registration statement under the Securities Act with respect to our initial public offering of Shares was declared effective by the
+Securities and Exchange Commission. We received approximately US$10,000,000 in net proceeds from the offering after payment of
+underwriting discounts and commissions, a non-accountable expense allowance and estimated expenses of the offering.
+
+ 
+
+Concurrent with our initial public
+offering, our shares were listed on the Nasdaq under the symbol "MEON."
+
+ 
+
+We are an "emerging growth
+company" as defined in Section 2(a) of the Securities Act of 1933, as amended, and we have elected to comply with certain reduced
+public company reporting requirements.
+
+ 
+
+Investing
+in our shares involves a high degree of risk, including the risk of losing your entire investment. See Risk Factors beginning
+on page 16 to read about factors you should consider before buying our shares.
+
+ 
+
+We
+are a holding company incorporated in the Cayman Islands. As a holding company with no material operations of its own, we conduct all
+of our operations and operate our business in Hong Kong through our Hong Kong Operating Subsidiaries. The shares offered in this offering
+are shares of our Company, a Cayman Islands holding company and not shares of the Hong Kong Operating Subsidiaries. Investors in this
+offering will not directly hold equity interests in the Hong Kong Operating Subsidiaries. This structure involves unique risks to investors.
+
+ 
+
+All
+operations and business of the Company are primarily located in Hong Kong, a special administrative region of the PRC. Pursuant to the
+Basic Law of Hong Kong (the "Basic Law"), which is a national law of the PRC and constitutional document for Hong Kong, national
+laws of the PRC shall not be applied in Hong Kong except for those listed in Annex III of the Basic Law (which is confined to laws relating
+to national flag, national anthem and foreign affairs, as well as other matters outside the autonomy of Hong Kong). Further, there is
+no legislation stating that the laws in Hong Kong should be commensurate with those in the PRC. Despite the foregoing, conducting business
+in Hong Kong involves risks of changes to laws and regulations that may be promulgated by the PRC government or authorities in Hong Kong
+may take.
+
+ 
+
+The
+Company is subject to legal and operational risks associated with having certain of our Hong Kong Operating Subsidiaries operations
+in Hong Kong, including risks and uncertainties related to the legal, political and economic policies of the PRC government, the relations
+between China and Hong Kong and China and the United States, or Chinese or United States regulations, which risks could result in a material
+change in our operations and/or cause our Ordinary Shares to significantly decline in value or become worthless and affect our ability
+to offer or continue to offer securities to investors. We are also subject to the risks and uncertainties about any future actions of
+the PRC government in this regard that could disallow our holding company structure, which would likely result in a material change
+in our operations, and the value of our Class A Ordinary Shares may depreciate significantly or become worthless. See "Risk Factors
+— Risks Related to Doing Business in Hong Kong" on page 20. The Company s operations are primarily located in Hong
+Kong. As of the date of this prospectus, we do not expect to be materially affected by recent statements by the PRC authorities indicating
+an intent to exert more oversight over the securities offerings that are conducted overseas and/or foreign investment in China-based
+issuers. However, the policies, regulations, rules, and the enforcement of laws to which we are subject may change. See "Transfers
+of Cash to and From Our Subsidiaries" on page 13 of this prospectus. Recently, the PRC government initiated a series of regulatory
+actions and statements on the regulation of business operations in China with little advance notice, including cracking down on illegal
+activities in the securities market, enhancing supervision over China-based companies listed overseas using a VIE structure, adopting
+new measures to extend the scope of cybersecurity reviews, and expanding efforts in anti-monopoly enforcement. None of our business activities
+appears to be within the immediate targeted areas of concern identified by the Chinese government. However, given the Chinese government s
+significant oversight and discretion over the conduct of our business operations in Hong Kong, the Chinese government may intervene or
+influence our operations at any time, which could result in a material change in our operations and consequently, the value of our Ordinary
+Shares. See "Risk Factors — Risks Related to Doing Business in Hong Kong" on page 20.
+
+ 
+
+ Alt-1
+
+ 
+
+ 
+
+ 
+
+On
+February 17, 2023, with the approval of the State Council, the China Securities Regulatory Commission (the "CSRC") promulgated
+the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies ("Trial Measures"), and
+five supporting guidelines, which came into effect on March 31, 2023. Pursuant to the Trial Measures, domestic companies that seek to
+offer or list securities overseas, both directly and indirectly, shall complete filing procedures with the CSRC pursuant to the requirements
+of the Trial Measures within three working days following their submission of initial public offerings or listing applications. Subsequent
+securities offerings of an issuer in the same overseas market where it has previously offered, and listed securities must be filed with
+the CSRC within three business days after the offering is completed. If a domestic company fails to complete the required filing procedures
+or conceals any material fact or falsifies any major content in its filing documents, such domestic company may be subject to administrative
+penalties, such as an order to rectify, warnings and fines, and its controlling shareholders, actual controllers, the person directly
+in charge and other directly liable persons may also be subject to administrative penalties, such as warnings and fines.
+
+ 
+
+As
+of the date of this prospectus, our Company and its subsidiaries (the "Group") (as defined in the definitions section below)
+have not received any formal inquiry, notice, warning, sanction, or objection from the CSRC with respect to the listing of the Company s
+Ordinary Shares. Further, as of the date of this prospectus, in the opinion of our PRC legal counsel, The Alpha Law Firm, based on the
+above mentioned, listing on NASDAQ of the Company would not be deemed as an indirect overseas offering and listing by a PRC domestic
+company under the Trial Measures and the Trial Measures do not apply to the Company, and its listing on NASDAQ does not require fulfilling
+the filing procedure to the CSRC. However, the CSRC may take a view contrary to or otherwise different from the Group s or the
+future effective laws and regulations (with retrospective effect) may require the Group to obtain CSRC or other PRC governmental approvals
+for this offering. If we inadvertently conclude that such approvals are not required, we may be required to make corrections, be given
+a warning, be fined between RMB 1 million and RMB 10 million, warn the responsible person and impose a fine of not less than RMB500,000
+but not more than RMB5 million, fine the controlling shareholder or actual controller organizes or instigates the prescribed illegal
+acts not less than RMB1 million but not more than RMB10 million, in the case of serious violation of the Trial Measures or other laws
+and administrative regulations, the CSRC may impose a ban on access to the securities market upon relevant responsible persons.
+
+ 
+
+However,
+there is uncertainty as to whether our Company will be required to obtain permission from or file with the PRC authorities to list on
+a U.S. stock exchange in the future. If the Group is subsequently notified by any PRC authorities that permission/filing for this offering
+and/or listing on the Nasdaq Stock Market was required, the Group may not be able to obtain such permission or complete such filing in
+a timely manner, if at all. Any failure to obtain such permission or complete such filing in a timely manner may restrict our ability
+to complete the proposed offering or any future equity capital raising activities and may subject us or relevant persons to certain penalties,
+which would have a material adverse effect on our business and financial position.
+
+ 
+
+There
+can be no assurance that the relevant PRC governmental authorities, including the CSRC, would reach the same conclusion as us, or that
+the CSRC or any other PRC governmental authorities would not promulgate new rules or new interpretation of current rules (with retrospective
+effect) to require us to obtain CSRC or other PRC governmental approvals for our IPO. If the Company inadvertently concluded that such
+approvals were or are not required, the Company s ability to offer or continue to offer our Securities to investors could be significantly
+limited or completed hindered, which could cause the value of our Ordinary Shares to significantly decline or become worthless. The Group
+may also face sanctions by the CSRC, the Cyberspace Administration of China ("CAC") or other PRC regulatory agencies. These
+regulatory agencies may impose fines, penalties, limit our operations in China, or take other actions that could have a material adverse
+effect on our business, financial condition, results of operations and prospects, as well as the trading price of our Securities. See
+"Risk Factors" beginning on page 16 of this prospectus for a discussion of these legal and operational risks and other information
+that should be considered before making a decision to purchase our Securities.
+
+ 
+
+Although
+Hong Kong is a Special Administrative Region and a dependency of the PRC, it has enacted its own laws pertaining to data security and
+anti-monopoly concerns. Hong Kong enacted the Personal Data (Privacy) Ordinance (the "PDPO") to ensure an adequate level
+of data protection to retain its status as an international trading center and to give effect to human rights treaty obligations. Moreover,
+Hong Kong has also enacted a similar piece of legislation regulating competition in the market (the "Competition Ordinance").
+The Competition Ordinance prohibits: (i) anti-competitive agreements and concerted practices; and (ii) abuse of power with the object
+or effect of preventing, restricting or distorting competition in Hong Kong. If our Hong Kong Operating Subsidiary Operating Subsidiaries
+was to be found in violation of either of these laws, our Hong Kong Operating Subsidiaries operations may be restricted, and they
+may be required or elect to make changes to its operations in Hong Kong so as to be in accordance with the PDPO and/or the Competition
+Ordinance. Moreover, Hong Kong authorities may take other action against us, such as imposing taxes or other penalties, which could materially
+affect our financial results. Thus, our revenue and business operations in Hong Kong would be adversely affected.
+
+ 
+
+In
+addition, the Holding Foreign Companies Accountable Act (the "HFCAA"), which prohibits foreign companies from listing their
+securities on U.S. exchanges if the company s auditor has been unavailable for Public Company Accounting Oversight Board (United
+States) ("PCAOB") inspection or investigation for three consecutive years, became law in December 2020. On December 16, 2021,
+the PCAOB issued a determination (the "Determination Report") that the PCAOB is unable to inspect or investigate completely
+PCAOB-registered public accounting firms headquartered in China and in Hong Kong because of positions taken by authorities in those jurisdictions,
+and the PCAOB included in the Determination Report a list of the accounting firms that are headquartered in the PRC or Hong Kong. On
+December 15, 2022, the PCAOB announced that it has secured complete access to inspect and investigate registered public accounting firms
+headquartered in China and Hong Kong and voted to vacate the previous 2021 Determination Report to the contrary. The U.S. Securities
+and Exchange Commission (the "SEC") adopted final amendments to its rules to implement the HFCAA, which went into effect
+on January 20, 2022. As part of the SEC s final rules, identified issuers will need to provide additional disclosures in subsequent
+filings that prove the issuer is not owned or controlled by a governmental authority in the foreign jurisdiction of the audit firm identified
+by the PCAOB in the Determination Report.
+
+ 
+
+In
+the event that it is later determined that the PCAOB is unable to inspect or investigate completely our auditor or our work papers because
+of a position taken by an authority in a foreign jurisdiction, then such lack of inspection could cause our securities to be delisted
+from the applicable stock exchange. The delisting of our Ordinary Shares, or the threat of their being delisted, may materially and adversely
+affect the value of your investment.
+
+ 
+
+Furthermore,
+on June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act (the "AHFCAA"), which
+was enacted on December 29, 2022, and amended the HFCAA to require the SEC to prohibit an issuer s securities from trading on any
+U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three.
+
+ 
+
+On
+August 26, 2022, the CSRC, the Ministry of Finance of the PRC (the "MOF"), and the PCAOB signed a Statement of Protocol (the
+"Protocol") to allow the PCAOB to inspect and investigate completely registered public accounting firms headquartered in
+China and Hong Kong, consistent with the HFCAA. Pursuant to the fact sheet with respect to the Protocol disclosed by the SEC, the PCAOB
+shall have independent discretion to select any issuer audits for inspection or investigation and has the unfettered ability to transfer
+information to the SEC.
+
+ 
+
+ Alt-2
+
+ 
+
+ 
+
+ 
+
+On
+December 15, 2022, the PCAOB Board determined that the PCAOB was able to secure complete access to inspect and investigate registered
+public accounting firms headquartered in China and Hong Kong and voted to vacate its previous determinations to the contrary. However,
+should PRC authorities obstruct or otherwise fail to facilitate the PCAOB s access in the future, the PCAOB Board will consider
+the need to issue a new determination. On December 23, 2022, the Accelerating HFCA Act (the "Accelerating HFCA Act") was
+signed into law, which amended the HFCA Act by requiring the SEC to prohibit an issuer s securities from trading on any U.S. stock
+exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three. On December 29, 2022, the Consolidated
+Appropriations Act was signed into law by President Biden. The Consolidated Appropriations Act contained, among other things, an identical
+provision to the Accelerating HFCA Act, which reduces the number of consecutive non-inspection years required for triggering the prohibitions
+under the HFCA Act from three years to two.
+
+ 
+
+Our
+auditor, TAAD LLP, the independent registered public accounting firm that issues the audit report included in this prospectus, as an
+auditor of companies that are traded publicly in the United States and a firm registered with the PCAOB, is subject to laws in the United
+States pursuant to which the PCAOB conducts regular inspections to assess TAAD LLP s compliance with applicable professional standards.
+TAAD LLP is headquartered in California and has been inspected by the PCAOB on a regular basis, with the last inspection in April 2024.
+Therefore, we believe that, as of the date of this prospectus, our auditor is not subject to the PCAOB Determinations (as defined below).
+See "Risk Factors — Risks Related to Doing Business in Hong Kong — The PCAOB Determinations provides that if the Board
+is unable to inspect or investigate completely registered public accounting firms headquartered in China or Hong Kong, a Special Administrative
+Region and dependency of the PRC, because of a position taken by one or more authorities in China or Hong Kong it could result in the
+prohibition of trading in our securities by not being allowed to list on a U.S. exchange, and as a result an exchange may determine to
+delist our securities, which would materially affect the interest of our investors." on page 24.
+
+ 
+
+The
+Company holds all of the equity interests in its Hong Kong Operating Subsidiaries through a subsidiary incorporated in the British Virgin
+Islands ("BVI"). As we have a direct equity ownership structure, we do not have any agreement or contract between our Company
+and any of its subsidiaries that are typically seen in a VIE structure. Within our direct equity ownership structure, funds from foreign
+investors can be directly transferred to the Hong Kong Operating Subsidiaries by way of capital injection or in the form of a shareholder
+loan from the Company following this offering. As a holding company, the Company may rely on dividends and other distributions on equity
+paid by our Hong Kong Operating Subsidiaries to our BVI subsidiary and then to the Company for our cash and financing requirements. We
+are permitted under the laws of the Cayman Islands and our Amended and Restated Memorandum and Articles of Association to provide funding
+to our Hong Kong Operating Subsidiaries through loans and/or capital contributions. Our Hong Kong Operating Subsidiaries are permitted
+under the laws of Hong Kong to issue cash dividends to us without limitation on the size of such dividends. However, if the Hong Kong
+Operating Subsidiaries incur debt on its own behalf, the instruments governing such debt may restrict their ability to pay dividends.
+As of the date of this prospectus, no transfers, dividends, or distributions have been made between the Company, the BVI subsidiary,
+the Hong Kong Operating Subsidiaries or investors. See "Dividend Policy" on page 41 of this prospectus As of the date of
+this prospectus, our Hong Kong Operating Subsidiaries do not maintain cash management policies or procedures dictating the amount of
+such funding or how funds are transferred. See "Holding Company Structure" on page 13 of this Prospectus. Further, as of
+the date of this prospectus, no dividends or distributions have been made to date to investors in the Company. Further, there can be
+no assurance that the flow of cash in or out of Hong Kong would not be restricted or prohibited. To the extent the Company s cash
+or assets in the business is in Hong Kong or a Hong Kong entity, the Company s funds or assets may, in the future, not be available
+to fund operations or for other use outside of Hong Kong due to interventions in or the imposition of restrictions and limitations on
+the ability of the Company and our Hong Kong Operating Subsidiaries by the PRC government to transfer cash or assets. Any restrictions,
+prohibitions, interventions or limitations on the ability of the Company or our Hong Kong Operating Subsidiaries to transfer cash or
+assets in or out of Hong Kong may result in these funds or assets not being available to fund operations or for other uses outside of
+Hong Kong, which could have a material adverse effect on our ability to conduct our business. See "Risk Factors — Risks Related
+to Doing Business in Hong Kong — The Company may rely on dividends and other distributions on equity paid by the Hong Kong Operating
+Subsidiaries to fund any cash and financing requirements it may have, and any limitations or restrictions, prohibitions or limitations
+on the ability of the Company or our Hong Kong Operating Subsidiaries by the PRC government to transfer cash or assets in or out of Hong
+Kong may result in these funds or assets not being available to fund operations or for other uses outside of Hong Kong, which on the
+ability of the Hong Kong Operating Subsidiaries to make payments to the Company could have a material and adverse effect on the business."
+on page 24.
+
+ 
+
+Upon
+completion of this offering, our issued and outstanding shares will consist of [5,500,000] Class A Ordinary Shares and [16,500,000
+class B ordinary shares of par value US$0.0002 each of the Company ("Class B Ordinary Shares"]] assuming no exercise of
+the over-allotment by the underwriter and [5,800,000] Class A Ordinary Shares and [16,500,000 Class B Ordinary Shares] assuming the
+underwriter fully exercises its over-allotment option. Holders of Class A Ordinary Shares and Class B Ordinary Shares have the same
+rights except for voting and conversion rights. Each Class A Ordinary Share shall entitle the holder thereof to one (1) vote on all
+matters subject to vote at the general meetings, and each Class B Ordinary Share shall entitle the holder thereof to twenty (20)
+votes on all matters subject to vote at the general meetings. Due to the disparate voting powers associated with our two classes of
+ordinary shares, upon completion of this offering, the largest shareholder of our company, Tech Vision Investment Limited, the
+holder of 16,500,000 of our Class B Ordinary Shares, will beneficially own 98.36% of the total aggregate voting power, assuming that
+the underwriter does not exercise its over-allotment option. We will be a controlled company as defined under the Nasdaq Capital
+Market Company Guide Section 801(a). Immediately after the completion of this offering, Tech Vision Investments Limited, our
+controlling shareholder, will own approximately [16,500,000] Class B Ordinary Shares, representing approximately [98.36]% of the
+total voting power, assuming no exercise of the over-allotment option, and 16,500,000 Class B Ordinary Shares, or 98.27% of the
+total voting power assuming the underwriter does exercise its over-allotment option. Tech Vision Investment Limited is wholly owned
+by Vizz Technology Limited, a Hong Kong company and indirectly wholly owned by Vizz Group (Holding) Limited, a Hong Kong company.
+Mr. Jerry Chi Wai Chan, the Company s Chief Executive Officer owns 5.18% of the ordinary shares of Vizz Group (Holding)
+Limited and Mr. Jimmy Shu Wai Chan, the Company s Chief Financial Officer is the sole director of and owns 36.09% of the
+ordinary shares of Vizz Group (Holding) Limited. As such, Mr. Jimmy Shu Wai Chan will control matters subject to a vote by the
+Company s shareholders, including but not limited to the election of directors, amendment of our memorandum and articles of
+organization, and approval of major corporate transactions, such as a change in control, merger, consolidation, or sale of assets
+and the Company will be a "controlled company" as defined under the Nasdaq Stock Market Rules. As a "controlled
+company," the Company is permitted to elect not to comply with certain corporate governance requirements. Although the Company
+currently does not intend to rely on the "controlled company" exemption, it may elect to rely on this exemption in the
+future. If the Company relies on these exemptions in the future, you will not have the same protection afforded to shareholders of
+companies that are subject to these corporate governance requirements. See "Prospectus Summary — Implications of Being a
+Controlled Company" on page 12 for additional information.
+
+ 
+
+We are an "Emerging Growth
+Company" and a "Foreign Private Issuer" under applicable U.S. federal securities laws and, as such, are eligible for
+reduced public company reporting requirements. Please see Implications of Being an Emerging Growth Company and Implications of Being a
+Foreign Private Issuer beginning on page 12 and page 13 of this prospectus for more information.
+
+ 
+
+An investment in our shares
+involves significant risks. You should carefully consider the risk factors beginning on page 16 of this prospectus before you
+make your decision to invest in our shares.
+
+ 
+
+Neither the Securities and
+Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy
+of this prospectus. Any representation to the contrary is a criminal offense.
+
+ 
+
+The date of this prospectus is [ ],
+2025
+
+ 
+
+[RESALE PROSPECTUS ALTERNATE PAGE]
+
+ 
+
+ Alt-3
+
+ 
+
+ 
+
+ 
+
+TABLE OF CONTENTS
+
+ 
+
+ 
+ 
+ Page
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/CIK0002061626_21shares_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CIK0002061626_21shares_prospectus_summary.txt
new file mode 100644
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--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/CIK0002061626_21shares_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1 RISK FACTORS 17 SUI, SUI MARKETS AND REGULATION OF SUI 74 THE TRUST AND SUI PRICES 84 NAV DETERMINATIONS 88 ADDITIONAL INFORMATION ABOUT THE TRUST 91 THE TRUST S SERVICE PROVIDERS 95 CUSTODY OF THE TRUST S ASSETS 97 STAKING OF THE TRUST S ASSETS 99 PRIME BROKER 101 FORM OF SHARES 105 TRANSFER OF SHARES 106 AUDIT SEED/INITIAL SEED CREATION INVESTOR 107 PLAN OF DISTRIBUTION 108 CREATION AND REDEMPTION OF SHARES 110 USE OF PROCEEDS 117 OWNERSHIP OF BENEFICIAL INTEREST IN THE TRUST 118 CONFLICTS OF INTEREST 119 DUTIES OF THE SPONSOR 121 LIABILITY AND INDEMNIFICATION 123 PROVISIONS OF LAW 125 MANAGEMENT; VOTING BY SHAREHOLDERS 126 BOOKS AND RECORDS 126 STATEMENTS, FILINGS, AND REPORTS TO SHAREHOLDERS 127 FISCAL YEAR 127 GOVERNING LAW; CONSENT TO DELAWARE JURISDICTION 127 LEGAL MATTERS 127 EXPERTS 127 OTHER MATERIAL CONTRACTS 128 UNITED STATES FEDERAL INCOME TAX CONSEQUENCES 130 PURCHASES BY EMPLOYEE BENEFIT PLANS 135 INFORMATION YOU SHOULD KNOW 136 SUMMARY OF PROMOTIONAL AND SALES MATERIAL 136 INTELLECTUAL PROPERTY 137 WHERE YOU CAN FIND MORE INFORMATION 138 PRIVACY POLICY 139 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM F-1 APPENDIX A A-1 PART II INFORMATION NOT REQUIRED IN PROSPECTUS II-1 This Prospectus contains information you should consider when making an investment decision about the Shares of the Trust. You may rely on the information contained in this Prospectus. The Trust and the Sponsor have not authorized any person to provide you with different information and, if anyone provides you with different or inconsistent information, you should not rely on it. This Prospectus is not an offer to sell the Shares in any jurisdiction where the offer or sale of the Shares is not permitted. The Shares of the Trust are not registered for public sale in any jurisdiction other than the United States. Until 25 calendar days after the date of this Prospectus, all dealers effecting transactions in the Shares, whether or not participating in this offering, may be required to deliver a prospectus. This requirement is in addition to the dealer s obligation to deliver a prospectus when acting as underwriters and with respect to unsold allotments or subscriptions. i STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This Prospectus includes "forward-looking statements" that generally relate to future events or future performance. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "intend," "plan," "anticipate," "believe," "estimate," "predict," "potential" or the negative of these terms or other comparable terminology. All statements (other than statements of historical fact) included in this Prospectus that address activities, events or developments that will or may occur in the future, including such matters as movements in the digital asset markets and indexes that track such movements, the Trust s operations, the Sponsor s plans and references to the Trust s future success and other similar matters, are forward-looking statements. These statements are only predictions. Actual events or results may differ materially. These statements are based upon certain assumptions and analyses the Sponsor has made based on its perception of historical trends, current conditions and expected future developments, as well as other factors appropriate in the circumstances. Whether or not actual results and developments will conform to the Sponsor s expectations and predictions, however, is subject to a number of risks and uncertainties, including the special considerations discussed in this Prospectus, general economic, market and business conditions, changes in laws or regulations, including those concerning taxes, made by governmental authorities or regulatory bodies, and other world economic and political developments. Consequently, all the forward-looking statements made in this Prospectus are qualified by these cautionary statements, and there can be no assurance that actual results or developments the Sponsor anticipates to occur will be realized or, even if substantially realized, that they will result in the expected consequences to, or have the expected effects on, the Trust s operations or the value of its Shares. Should one or more of these risks discussed in "Risk Factors" or other uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes may vary materially from those described in forward-looking statements. Forward-looking statements are made based on the Sponsor s beliefs, estimates and opinions on the date the statements are made, and neither the Trust nor the Sponsor is under a duty or undertakes an obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change, other than as required by applicable laws. Investors are therefore cautioned against placing undue reliance on forward-looking statements. ii PROSPECTUS SUMMARY This is only a summary of the Prospectus and, while it contains material information about the Trust and its Shares, it does not contain or summarize all of the information about the Trust and the Shares contained in this Prospectus that is material and/or which may be important to you. You should read this entire Prospectus before making an investment decision about the Shares. See "Glossary of Defined Terms" for an explanation of certain industry and technical terms used in this Prospectus. Overview of the Trust The 21Shares Sui ETF (the "Trust") is an exchange-traded fund that issues common shares of beneficial interest (the "Shares") that trade on the NASDAQ Stock Market LLC (the "Exchange"). The Trust s investment objective is to seek to track the performance of SUI, as measured by the performance of the CME CF Sui — Dollar Reference Rate — New York Variant (the "Pricing Benchmark"), adjusted for the Trust s expenses and other liabilities, and to reflect rewards from staking a portion of the Trust s SUI, to the extent the Sponsor in its sole discretion determines that the Trust may do so without undue legal or regulatory risk, such as, without limitation, the risk of jeopardizing the Trust s ability to qualify as a grantor trust for tax purposes. The Pricing Benchmark is calculated by CF Benchmarks Ltd (the "Benchmark Provider"). The Pricing Benchmark is designed to reflect the performance of SUI in U.S. dollars. The Shares of the Trust are valued daily based on the Pricing Benchmark. In seeking to achieve its investment objective, the Trust will hold SUI. The Trust is sponsored by 21Shares US LLC (the "Sponsor"), a wholly-owned subsidiary of 21co Holdings Limited (formerly known as Amun Holdings Limited). SUI is a digital asset. Like all digital assets, buying, holding and selling SUI is very different from buying, holding and selling more conventional investments like stocks and bonds. Stocks represent ownership in a company, entitling shareholders to a portion of the company s profits. Bonds are debt instruments issued by corporations or governments, where the bondholder is a creditor to the issuer that is generally entitled to a stream of income payments. Ownership of stocks and bonds is typically recorded through a centralized system managed by brokers, custodians or clearinghouses. Ownership of SUI does not entitle its holders to any portion of a company s profits or any stream of income payments. SUI is a digital asset and ownership of it is reflected on a distributed ledger. Additionally, SUI is not offered and sold as a security and is thus not subject to the protections of the U.S. federal securities laws. The Trust does not provide investors with direct exposure to SUI, and an investment in the Trust is not a direct investment in SUI. Rather, the Trust provides investors with the opportunity to indirectly access the market for SUI through a traditional brokerage account without the potential barriers to entry or risks involved with holding or transferring SUI directly or acquiring it from a SUI spot market. To the extent the Sponsor determines to stake a portion of the Trust s SUI, the Sponsor plans to engage one or more third party staking services providers (each a "Staking Services Provider") to conduct such staking activities ("Staking Activities"). The Sponsor s choice of third party Staking Services Providers, and its decision to allocate SUI amongst chosen Staking Services Providers, will be based on a range of factors, including but not limited to the performance, reliability, and reputation of the staking provider, including monitoring their uptime and slashing history. The Sponsor may instead seek to utilize alternative means to engage in Staking Activities, subject to its determination that the Trust may do so without undue legal, regulatory or tax risk, including the use or holding of liquid staking tokens ("Liquid Staking Tokens"), though no such determination has been made as of the date of this Prospectus. These alternative means to engage in Staking Activities are subject to the Trust s determination that the Trust may do so without undue legal, regulatory or tax risk. More specifically, the Trust may earn staking rewards by investing in liquid staking protocols, which are staking protocols that provide a freely-tradeable digital token called a "Liquid Staking Token" that represents the SUI staked with the staking protocol. Liquid Staking Tokens permit the holder to receive the benefits of staking without the illiquidity of a locked-up SUI. Liquid Staking Tokens may only be acquired by the Trust if the Trust were to make a determination that the Liquid Staking Token represents beneficial ownership of the underlying SUI for U.S. federal income tax purposes and that acquisition of the Liquid Staking Token did not vary the investments of the Trust. No definitive determination has been made as of the date of this Prospectus as to which, if any, of these alternative means the Trust may adopt. Should such a change take place, if any, the Trust will notify the owners of the beneficial interests of Shares in a prospectus supplement or in its periodic Exchange Act reports, as applicable, and on the Sponsor s website. The Trust will custody its SUI at a regulated third-party custodian, Coinbase Custody Trust Company, LLC (the "SUI Custodian"). The SUI Custodian is chartered as a New York state limited liability trust company that provides custody and trade execution services for digital assets. The SUI Custodian is not Federal Deposit Insurance Corporation ("FDIC")-insured but carries insurance provided by private insurance carriers. The Trust, the Sponsor and the service providers will not loan or pledge the Trust s assets, including staked assets, nor will the Trust s assets, including staked assets, serve as collateral for any loan or similar arrangement, other than in connection with the Post-Trade Financing Agreement. The Trust will not invest in derivatives. The Sponsor believes that the Shares are designed to provide investors with a cost-effective and convenient way to invest in SUI without purchasing, holding and trading SUI directly. The amount of SUI represented by the Shares is expected to decline over time because of the transfer of the Trust s SUI to pay the Sponsor Fee and other liabilities, regardless of whether the trading price of the Shares rise or fall. The decrease in the amount of SUI represented by the Shares due to paying the Sponsor Fee and other liabilities may be offset by net staking rewards, if any. 1 Should the Trust seek to engage in Staking Activities, the Trust may stake a portion of the Trust s assets through one or more Staking Services Providers. As a result of any staking activity in which the Trust may engage, the Trust expects to receive certain staking rewards of SUI, which is expected to be treated for federal income tax purposes as income to the Trust. See "United States Federal Income Tax Consequences" for further description of the tax implications of the activities of the Trust to an investor. The Staking Services Provider shall exercise no discretion as to the amount of the Trust s SUI to be staked or the timing of the Staking Activities. The SUI Custodian will maintain exclusive possession and control of the private keys associated with any staked SUI at all times. Staking activity on the Sui Network involves the delegation of SUI to validators and carries certain risks. Staked SUI may be subject to community-determined penalties, e.g., penalization for validator misbehavior or poor performance. Misbehavior or poor performance by validators (in the estimation of at least two-thirds of the other validators) may result in such validators receiving reduced staking rewards for an epoch during which they misbehaved or performed poorly. Should any of the Trust s Staking Services Providers engage in malicious activity or perform poorly, then such Staking Services Provider may be slashed, which could negatively impact the Trust s abilities to engage in Staking Activities and/or otherwise result in the Trust earning reduced staking rewards. If any Staking Services Provider causes the Trust s staked SUI to be subject to such slashing losses, the Trust could suffer losses of the staked SUI. Additionally, the staking process includes protocol-defined warm-up, activation and withdrawal periods, during which staked SUI is temporarily locked and inaccessible. These phases affect when SUI begins earning rewards, participates in consensus and becomes available for transfer or redelegation. The description and considerations related to staking are discussed more fully below in "Risk Factors-Risks Associated with SUI and the Sui Network." SUI and the Sui Network SUI is a digital asset that is created and transmitted through the operations of the "Sui Network," an online, distributed computing platform that operates on a peer-to-peer basis. The Sui Network is a decentralized blockchain platform designed to support a wide range of applications, particularly in the realm of decentralized finance ("DeFi"), non-fungible tokens ("NFTs"), and other blockchain-based services. The network aims to address scalability and efficiency issues that have plagued earlier blockchain networks like Bitcoin and Ethereum. By leveraging advanced consensus mechanisms and innovative data structures, the Sui Network seeks to provide a more scalable, secure, and user-friendly environment for developers and users alike. The Sui Network employs a unique consensus algorithm that allows it to process a large number of transactions per second ("TPS"), making it suitable for applications that require high throughput, such as gaming and high-frequency trading. As of June 5, 2025, SUI had a total market capitalization of approximately $6.93 billion and represented approximately 0.22% of the entire digital asset market. As of May 22, 2025, there were 52 decentralized applications developed and over 1,400 active developers on the Sui Network. The two largest decentralized applications on the Sui Network were focused on lending markets. The Sui Network s architecture combines continuous monitoring of external blockchains, strategic validator key registrations, and a quadratic stake-based consensus mechanism to facilitate secure and decentralized cross-chain interactions. The Sui Network uses advanced cryptographic techniques to ensure the security and integrity of transactions. The distributed nature of the network makes it resistant to attacks and censorship. The Sui Network is also designed to be highly interoperable with other blockchain networks, allowing assets and data to be easily transferred between SUI and other blockchains, facilitating a more connected and versatile ecosystem. No single entity owns or operates the Sui Network, the infrastructure of which is collectively maintained by a broad user base. The Sui Network allows people to exchange tokens of value, called SUI, which are recorded on a public transaction ledger known as a blockchain. SUI can be used to pay for transaction fees and network operations, including computational power on the Sui Network, or it can be converted to fiat currencies, such as the U.S. dollar, at rates determined on digital asset trading platforms or in individual end-user-to-end-user transactions under a barter system. Furthermore, the Sui Network was designed to allow users to write and implement smart contracts - that is, general-purpose code that executes on the network and can instruct the transmission of information and value based on a sophisticated set of logical conditions. Using smart contracts, users can create markets, store registries of debts or promises, represent the ownership of property, move funds in accordance with conditional instructions and create digital assets other than SUI on the Sui Network. Smart contract operations are executed on the Sui blockchain in exchange for payment of SUI. Like the Ethereum network, the Sui Network is one of a number of projects intended to expand blockchain use beyond just a peer-to-peer money system. The Sui Network primarily uses a delegated proof-of-stake consensus mechanism to incentivize SUI holders to validate transactions. Unlike proof-of-work, in which miners expend computational resources to compete to validate transactions and are rewarded coins in proportion to the amount of computational resources expended, in proof-of-stake, validators risk or "stake" coins to compete to be randomly selected to validate transactions and are rewarded coins in proportion to the amount of coins staked. Any malicious activity, such as disagreeing with the eventual consensus or otherwise violating protocol rules, results in the forfeiture or "slashing" of a portion of the staked coins. Proof-of-stake is viewed as more energy efficient and scalable than proof-of-work and is sometimes referred to as "virtual mining". Unlike many other smart contract platforms that batch transaction into blocks, Sui validators individually validate transactions. Sui uses "Narwhal" and "Bullshark" as its memory pool and consensus engines, respectively, which supplement proof-of-stake by allowing transactions performed on the Sui Network to be verified and executed in parallel, rather than sequentially like in prominent blockchains like Bitcoin and Ethereum. Under Narwhal, instead of a proposing validator broadcasting all transactions in a block to the other validators, the proposing validators send references to transactions that other validators have already received in their local memory pools. These memory pools serve as logs of unprocessed transactions awaiting verification and execution on a blockchain. The transaction data can thus bypass the full consensus process, removing the large data transmission step which often impedes proof-of-stake consensus and introduces latency. Further unlike traditional blockchains, which add transactions in a single, linear sequence, Bullshark uses a structure whereby each transaction points to multiple previous transactions, allowing many transactions to be processed at the same time. The purpose of Narwhal and Bullshark is to increase scalability of a blockchain allowing for parallel processing of transactions and increasing transaction speed. 2 New SUI is created as a result of "staking" of SUI by validators. In the Sui Network, validators stake SUI to compete to be randomly selected to validate transactions. Validation activities include verifying transactions, storing data, and adding to the SUI blockchain. Validators are rewarded SUI in proportion to the amount of SUI staked. SUI holders do not have to stake a minimum amount of SUI to become a SUI validator, although some staking providers and platforms may require minimum staking amounts. The Sui Network provides the ability to execute peer-to-peer transactions to realize, via smart contracts, automatic, conditional transfer of value and information, including money, voting rights, and property. More specifically, staking on the Sui Network refers to using SUI, or permitting SUI to be used, directly or indirectly, through an agent or otherwise, in the Sui Network s proof-of-stake validation protocol, in exchange for the receipt of consideration, including, but not limited to, staking rewards paid in kind. The SUI token serves four purposes on the Sui Network. First, SUI can be staked within an "epoch" in order to participate in the proof-of-stake mechanism. Second, SUI is the asset denomination needed for paying the Gas Fees (as defined below) to execute transactions or other operations on the Sui Network. Third, SUI can be used as a versatile and liquid asset for various applications including the standard features of money – a unit of account, a medium of exchange, or a store of value – and more complex functionality enabled by smart contracts, interoperability, and composability across the Sui ecosystem. Fourth, and finally, SUI plays an important role in governance by acting as a right to participate in on-chain voting on issues such as protocol upgrades. The total supply of SUI on the Sui Network s "mainnet" is capped at 10,000,000,000 (ten billion), the supply of which is dependent upon designed unlocking schedules and other circulation variables. SUI is "stored" on a blockchain and is linked to a unique digital address, or wallet, that is associated with a public key and a private key. The public key is used to generate the address that is available to other users of the Sui Network. The address serves as the location to which SUI can be transferred and from which SUI can be sent. The private key authorizes the transfer or "spending" of SUI from its associated public address. Ownership of SUI is established by recording on Sui Network s blockchain the unique address and the amount of SUI held. The wallet thus holds the cryptographic keys associated with SUI, rather than the SUI itself. SUI cannot be transferred by a holder unless that holder provides the private key. See "SUI, SUI MARKETS AND REGULATION OF SUI —Summary of a SUI Transaction" below. For more information on SUI and the Sui Network, see "Sui, SUI Market and Regulation of SUI" below. The Trust s Investment Objective The Trust s investment objective is to seek to track the performance of SUI, as measured by the Pricing Benchmark, adjusted for the Trust s expenses and other liabilities, and to reflect rewards from staking a portion of the Trust s SUI, to the extent the Sponsor in its sole discretion determines that the Trust may do so without undue legal or regulatory risk, such as, without limitation, the risk of jeopardizing the Trust s ability to qualify as a grantor trust for tax purposes. In seeking to achieve its investment objective, the Trust will hold SUI and will value its Shares daily as of 4:00 p.m. ET based on the Pricing Benchmark. Barring the liquidation of the Trust or extraordinary circumstances (including but not limited to, non-recurring expenses and costs of services performed by the Sponsor or a service provider on behalf of the Trust to protect the Trust or the interests of Shareholders, such as in connection with any fork of the Sui Network, any indemnification of agents, service providers or counterparties of the Trust and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters), the Trust generally will not purchase or sell SUI, other than in connection with the creation or redemption of Shares. The Sponsor may also sell SUI to pay certain expenses, which may be facilitated by the Prime Broker or any other prime brokers with whom the Trust contracts. Staking To the extent the Sponsor determines to stake a portion of the Trust s SUI, the Sponsor plans to engage one or more Staking Services Providers to conduct such Staking Activities. The Sponsor s choice of third party Staking Services Providers, and its decision to allocate SUI amongst chosen Staking Services Providers, will be based on a range of factors, including but not limited to the performance, reliability, and reputation of the staking provider, including monitoring their uptime and slashing history. 3 The Sponsor may also seek to utilize alternative means to engage in Staking Activities, subject to its determination that the Trust may do so without undue legal, regulatory or tax risk, including the use or holding of Liquid Staking Tokens, though no such determination has been made as of the date of this Prospectus. These alternative means to engage in Staking Activities are subject to the Trust s determination that the Trust may do so without undue legal, regulatory or tax risk. More specifically, the Trust may earn staking rewards by investing in liquid staking protocols, which are staking protocols that provide a freely-tradeable digital token called a "Liquid Staking Token" that represents the SUI staked with the staking protocol. Liquid Staking Tokens permit the holder to receive the benefits of staking without the illiquidity of a locked-up SUI. Liquid Staking Tokens may only be acquired by the Trust if the Trust were to make a determination that the Liquid Staking Token represents beneficial ownership of the underlying SUI for U.S. federal income tax purposes and that acquisition of the Liquid Staking Token did not vary the investments of the Trust. No definitive determination has been made as of the date of this Prospectus as to which, if any, of these alternative means the Trust may adopt. Should such a change take place, if any, the Trust will notify the owners of the beneficial interests of Shares in a prospectus supplement or in its periodic Exchange Act reports, as applicable, and on the Sponsor s website. The Trust s staking model aims to maximize the portion of the Trust s SUI available for staking while controlling for liquidity and redemption risks. The model determines an optimal Utilization Rate by balancing expected yield against potential costs. The Staking Services Provider will exercise no discretion as to the amount of the Trust s SUI to be staked or the timing of the Staking Activities. While the Trust may stake a maximum of 100% of its SUI holdings, the amount of SUI that remains unstaked is determined based on the Trust s Utilization Rate analysis, and accordingly may vary from time to time. Based on Utilization Rate analysis applied to historical data, the Trust generally intends to stake between 70% and 90% of the SUI it holds, although the amount of SUI that is staked may be lesser or greater from time to time. The precise percentage to be staked will be based on the estimated liquidity needs of the Trust and other factors, as determined by the Sponsor. In determining how to stake the SUI held by the Trust, and how much SUI to stake, the Trust s model operates on the following key parameters: Unbonding period: The number of days required for unbonding staked assets as dictated by the Sui Network protocol; ETF Historical redemption patterns: The historical percentages of cumulative drawdowns in redemptions during the bonding period for US listed ETFs and other similar instruments listed abroad; Size of the Trust & Concentration: A trust with a high concentration of shareholders may have a higher percentage risk of redemption compared to a trust has a diversified shareholder base and a large number of assets under management; Staking Services Provider performance: The model takes into account the performance, reliability, and reputation of staking services providers. This includes adherence to certain minimum operating standards, including monitoring their uptime, and slashing history; and Market conditions monitoring: The model tracks market conditions, like regime shifts in momentum/liquidity, conditions of heightened demand or supply, network events and protocol changes, staking services provider risks. The Trust intends to make available on its website the current percentage of the Trust s SUI being staked on a daily basis. 4 The rewards owed or paid to the Custodians as compensation for the Staking Services Providers reduce the amount of SUI rewards that are generated from the Trust s Staking Program that are available in the assets of the Trust. Each Staking Services Provider that generates staking rewards will be entitled to compensation determined as a portion of the staking rewards, which is generally expected to be determined by a fixed percentage of the overall rewards amount (the "Staking Provider Consideration"). The Custodian is responsible for paying the Staking Provider Consideration from the Trust s account, which may be paid directly to the Staking Services Provider or indirectly through the Custodian s own accounts. The Trust will pay [ ]% of the staking rewards generated by the Trust s staking program after deduction of the Staking Provider Consideration to the Sponsor, and retain the remainder. Staking rewards will be added to the Trust s assets and accrete to NAV, and NAV per share would be expected to increase. The Trust will not distribute its staking rewards directly to Shareholders. The Sponsor has entered into a Master Infrastructure-As-A-Service Agreement (the "Staking Services Agreement") with Coinbase Crypto Services, LLC, a Delaware limited liability company ("Coinbase Crypto"). Pursuant to that agreement, Coinbase Crypto will provide the Sponsor with certain services, including the following, on any network protocol and/or blockchain that is supported by Coinbase: (i) staking, validating, generating or approving blocks of transactions to be added to a particular blockchain, helping to secure the network or otherwise engaging with or participating on the supported network; (ii) support for eligible changes, improvements, extensions or other new versions thereof on the network; and (iii) development, upgrades, migration, integration, testing, conversion, monitoring, maintenance, consulting, or other services and deliverables. The Staking Services Agreement with Coinbase Crypto has an initial term of two years, which automatically renews at the end of such a period. Under the Staking Services Agreement, Coinbase Crypto may either act as a public validator or as a private dedicated validator in the Templated Solidity mempool (the "[ ] Mempool"). In either case, Coinbase Crypto will ultimately receive a low single digit percentage of the overall rewards amount. The Trust may, from time to time, and at any time, engage additional staking providers besides Coinbase Crypto. The percentage of rewards to be paid to each such staking provider may vary and may be more or less than the amount paid by us to Coinbase Crypto. Rewards from staking will be shared, distributed and added to the assets of the Trust periodically. Specifically, staking rewards that accrue to the Trust on or before the calculation of the Trust s end-of-day NAV will be added to the assets of the Trust, irrespective of whether the staked SUI has been unbonded at such time. Staking requires that the Trust lock up the staked SUI and become subject to an unbonding period to unstake the staked SUI, meaning that the Trust cannot transfer the staked SUI during the time that the SUI is staked and during which it is being unbonded. On the Sui Network, there is a cooldown period of 24 hours (i.e., one epoch) following unstaking, during which the previously staked SUI is non-transferable. Under normal network conditions, the bonding period for SUI is typically one epoch. Due to the time involved in "exiting" the staking process, there is a risk that the Trust could become unable to timely meet excessive redemption requests in amounts that are greater than the portion of the Trust s SUI that remains un-staked, leading to temporary delays in settlement and, in extreme scenarios, the temporary unavailability of the Trust s redemption program. Moreover, any staked SUI which must be un-staked in order to fulfill a redemption (to the extent such redemption cannot be fulfilled utilizing the portion of the Trust s SUI that has not been staked, or through another mechanism to manage liquidity in connection with Redemption Orders) will be un-staked only after the redemption request is approved by the Trust, the Sponsor executes an un-stake or withdrawal transaction through the Custodian, and such transaction is processed by the Sui Network. The Staking Provider will not be able to transfer unstaked SUI or Staking Provider Consideration to another address on the Sui Network. In addition, the staked SUI may be classified as illiquid under the Trust's liquidity risk management program. In addition, if SUI is determined to be offered and sold as a security under the Securities Act of 1933 (the "1933 Act"), it could be subject to significant constraints in terms of any transfer or disposal of such SUI. In such event, the Trust may consider SUI to be an "illiquid security", which it defines as a security that the Trust reasonably expects cannot be sold or disposed of in current market conditions in seven calendar days or less without the sale or disposition significantly changing the market value of the security. 5 Rewards for staked SUI may be accrued in an epoch even before the staked SUI is unbonded. Once accrued, such SUI rewards are considered part of the Trust's assets, even if unbonding has not occurred. The Sponsor and the Trust will manage liquidity in accordance with the Trust's liquidity risk policies and procedures and will monitor staking and bonding/unbonding activity closely on a daily basis. For more information on the Trust's liquidity risk policies and procedures, see "Staking of the Trust's Assets-Liquidity Risk Policies and Procedures." When the Trust sells or redeems its Shares, SUI will be transferred into or out of the Trust, as applicable, in exchange for a Basket that is based on the quantity of SUI attributable to each Share of the Trust (net of accrued but unpaid Sponsor Fees and any accrued but unpaid extraordinary expenses or liabilities). Financial firms that are authorized to purchase Shares from or redeem Shares to the Trust (known as "Authorized Participants") may purchase Shares in cash by depositing cash in the Trust s account with the Cash Custodian. This will cause the Sponsor, on behalf of the Trust, to automatically instruct a designated third party, who is not an Authorized Participant but who may be an affiliate of an Authorized Participant and with whom the Sponsor has entered into an agreement on behalf of the Trust (each such third party, or the Prime Broker or Lender, as applicable, a "SUI Counterparty"), to (i) purchase the amount of SUI equivalent in value to the cash deposit amount associated with the order and (ii) deposit the resulting SUI amount in the Trust s account with the SUI Custodian, resulting in the Transfer Agent crediting the applicable amount of Shares to the Authorized Participant. Authorized Participants may also purchase Shares in-kind. To purchase Shares in-kind, an Authorized Participant delivers, or arranges for the delivery by the Authorized Participant s designated agent of, SUI to the Trust s account with the SUI Custodian in exchange for Shares. When such an Authorized Participant redeems its Shares in cash, the Sponsor, on behalf of the Trust will direct the SUI Custodian to transfer SUI to the SUI Counterparty, who will sell the SUI to be executed, in the Sponsor s reasonable efforts, at the Pricing Benchmark price used by the Trust to calculate NAV, taking into account any spread, commissions, or other trading costs and deposit the cash proceeds of such sale in the Trust s account with the Cash Custodian for settlement with the Authorized Participant. Any slippage incurred (including, but not limited to, any trading fees, spreads, or commissions) on a cash equivalent basis, will be the responsibility of the Authorized Participant and not of the Trust or Sponsor. Authorized Participants may also redeem Shares in-kind. When such an Authorized Participant redeems Shares in-kind, the Trust, through the SUI Custodian, will deliver SUI to the Authorized Participant, or a designated agent thereof, in exchange for its Shares. The SUI Counterparty is a designated third party with whom the Sponsor has entered into an agreement on behalf of the Trust that will deliver, receive or convert to U.S. dollars the SUI related to the Authorized Participant s cash creation or redemption order. In connection with cash creation orders, the Trust will create Shares by receiving SUI from a SUI Counterparty that is not the Authorized Participant, and the Trust — not the Authorized Participant — is responsible for selecting the SUI Counterparty to deliver the SUI. Further, the SUI Counterparty will not be acting as an agent of the Authorized Participant with respect to the delivery of the SUI to the Trust or acting at the direction of the Authorized Participant with respect to the delivery of the SUI to the Trust. The SUI Counterparty is not contractually obligated to participate in cash orders for creations. In connection with SUI redemption orders, the Trust will redeem Shares by delivering SUI to a SUI Counterparty that is not the Authorized Participant, and the Trust — not the Authorized Participant — is responsible for selecting the SUI Counterparty to receive the SUI. Further, the SUI Counterparty will not be acting as an agent of the Authorized Participant with respect to the receipt of the SUI from the Trust. The SUI Counterparty is not contractually obligated to participate in cash orders for redemptions. As of the date of this Prospectus, the Authorized Participants are [ ]. As of the date of this Prospectus, [ ] and [ ] serve as SUI Counterparties. The Trust and/or Sponsor will bear the expense and risk of delivery and ownership of SUI once such SUI has been received by the SUI Custodian on behalf of the Trust and until transferred by the SUI Custodian on behalf of the Trust to the SUI Counterparty for conversion to cash. All of the Trust s SUI will be held by the SUI Custodian. The Transfer Agent will facilitate the processing of purchase and sale orders in Baskets to and from the Trust. CME CF Sui — Dollar Reference Rate — New York Variant The Pricing Benchmark was introduced on June 9, 2025. The Benchmark Provider is the administrator of the Pricing Benchmark. The Pricing Benchmark is calculated daily. 6 The Sponsor believes that the use of the Pricing Benchmark is reflective of a reasonable valuation of the average spot price of SUI and that resistance to manipulation is a priority aim of its design methodology. The methodology: (i) takes an observation period and divides it into equal partitions of time; (ii) then calculates the volume-weighted median of all transactions within each partition; and (iii) the value is determined from the arithmetic mean of the volume-weighted medians, equally weighted. By employing the foregoing steps, the Pricing Benchmark thereby seeks to ensure that transactions in SUI conducted at outlying prices do not have an undue effect on the value of a specific partition, large trades or clusters of trades transacted over a short period of time will not have an undue influence on the index or benchmark level, as applicable, and the effect of large trades at prices that deviate from the prevailing price are mitigated from having an undue influence on the benchmark level. In addition, the Sponsor notes that an oversight function is implemented by the Benchmark Provider in seeking to ensure that the Pricing Benchmark is administered through codified policies for Pricing Benchmark integrity, which include a conflicts of interest policy, a control framework, an accountability framework, and an input data policy. It is also subject to the UK Benchmarks Regulation ("BMR"), compliance with which regulations has been subject to a Limited Assurance Audit under the ISAE 3000 standards of September 12, 2022. Pricing Benchmark data and the description of the Pricing Benchmark are based on information made publicly available by the Benchmark Provider on its website at https://www.cfbenchmarks.com/data/indices/SUIUSD_NY. None of the information on the Benchmark Provider s website is incorporated by reference into this Prospectus. The Sponsor has entered into a licensing agreement with the Benchmark Provider to use the Pricing Benchmark. The Trust is entitled to use the Pricing Benchmark pursuant to a sub-licensing arrangement with the Sponsor. As the Pricing Benchmark is calculated as a price return, it currently does not track airdrops involving SUI. Accordingly, the Trust will not participate in airdrops, as further described below in "Risk factors — The inability to recognize the economic benefit of a , ' ': fork or an , ' ': airdrop could adversely impact an investment in the Trust." Pricing Information Available on the Exchange and Other Sources The current market price per Share (symbol: "[ ]") will be published continuously as trades occur throughout each trading day on the consolidated tape by market data vendors. The intra-day indicative value per Share will be published by the Exchange once every 15 seconds throughout each trading day on the consolidated tape by market data vendors. The intra-day indicative value per Share is calculated based on the Pricing Benchmark. The most recent end-of-day NAV will be published as of the close of business by market data vendors and will be available on the Sponsor s website at www.21shares.com, or any successor thereto, and will be published on the consolidated tape. None of the information on the Sponsor s website is incorporated by reference into this Prospectus. Any adjustments made to the Pricing Benchmark will be published on the Benchmark Provider s website at https://www.cfbenchmarks.com/data/indices/SUIUSD_NY or any successor thereto. None of the information on the Benchmark Provider s website is incorporated by reference into this Prospectus. The selection of exchanges for use in the Pricing Benchmark is based on the accessible venues where execution transactions for SUI will occur. The exchanges on which market participants primarily execute transactions for SUI may evolve from time to time, and the Benchmark Provider may make changes to the Constituent Exchanges comprising the Pricing Benchmark from time to time for this or other reasons. To the extent the Trust executes transactions for SUI, the exchanges on which the Trust executes transactions do not impact the Constituent Exchanges comprising the Pricing Benchmark. Although Constituent Exchanges are selected for inclusion within the Pricing Benchmark in accordance with specified criteria and eligibility standards, changes to the Constituent Exchanges may result in an impact on the pricing information reflected in the Pricing Benchmark. Once it has actual knowledge of material changes to the Constituent Exchanges used to calculate the Pricing Benchmark, the Trust will notify the owners of the beneficial interests of Shares in a prospectus supplement or in its periodic Exchange Act reports, as applicable, and on the Sponsor s website. 7 The Sponsor may, in its sole discretion, change either the Pricing Benchmark or Benchmark Provider without Shareholder approval. Should such a change take place, the Trust will notify the owners of the beneficial interests of Shares in a prospectus supplement or in its periodic Exchange Act reports, as applicable, and on the Sponsor s website. The intra-day levels and closing levels of the Pricing Benchmark are published by the Benchmark Provider, and the closing NAV is published by the Administrator. The Shares are not issued, sponsored, endorsed, sold or promoted by the Exchange, and the Exchange makes no representation regarding the advisability of investing in the Shares. The Benchmark Provider makes no warranty, express or implied, as to the results to be obtained by any person or entity from the use of the Pricing Benchmark for any purpose. Pricing Benchmark information and any other data calculated and/or disseminated, in whole or part, by the Benchmark Provider is for informational purposes only, not intended for trading purposes, and provided on an "as is" basis. The Benchmark Provider does not warrant that the Pricing Benchmark information will be uninterrupted or error-free, or that defects will be corrected. The Benchmark Provider also does not recommend or make any representation as to possible benefits from any securities or investments, or third-party products or services. Shareholders should undertake their own due diligence regarding securities and investment practices. For more information on the Pricing Benchmark and the Benchmark Provider, see "The Trust and SUI Prices" below. The Trust s Legal Structure The Trust is a Delaware statutory trust, formed on January 7, 2025 pursuant to the Delaware Statutory Trust Act ("DSTA"). The Trust continuously issues Shares representing fractional undivided beneficial interest in, and ownership of, the Trust that may be purchased and sold on the Exchange. The Trust will operate pursuant to an Amended and Restated Trust Agreement (the "Trust Agreement"). CSC Delaware Trust Company, a Delaware trust company, is the Delaware trustee of the Trust (the "Trustee"). The Trust is managed and controlled by the Sponsor. The Sponsor is a limited liability company formed in the state of Delaware on June 16, 2021. The Trust s Service Providers The Sponsor The Sponsor, 21Shares US LLC, arranged for the creation of the Trust and is responsible for the ongoing registration of the Shares for their public offering in the United States and the listing of Shares on the Exchange. The Sponsor will develop a marketing plan for the Trust, will prepare marketing materials regarding the Shares of the Trust, and will exercise the marketing plan of the Trust on an ongoing basis. The Trustee The Trustee, CSC Delaware Trust Company, a Delaware trust company, acts as the trustee of the Trust as required to create a Delaware statutory trust in accordance with the Trust s Declaration of Trust and the DSTA. 8 The Administrator The Bank of New York Mellon serves as the Trust s administrator (the "Administrator"). The Administrator s principal address is 240 Greenwich Street, New York, New York 10286. Under the Fund Administration and Accounting Agreement, the Administrator provides necessary administrative, tax and accounting services and financial reporting for the maintenance and operations of the Trust, including valuing the Trust s SUI and calculating the NAV, NAV per Share, Principal Market NAV and Principal Market NAV per Share and supplying pricing information to the Sponsor for the Sponsor s website. In addition, the Administrator makes available the office space, equipment, personnel and facilities required to provide such services. The Transfer Agent The Bank of New York Mellon serves as the transfer agent for the Trust (the "Transfer Agent"). The Transfer Agent: (1) facilitates the issuance and redemption of Shares of the Trust; (2) responds to correspondence by Trust Shareholders and others relating to its duties; (3) maintains Shareholder accounts; and (4) makes periodic reports to the Trust. The Cash Custodian The Bank of New York Mellon acts as custodian of the Trust s cash and cash equivalents (the "Cash Custodian"). Pursuant to a cash custody agreement entered into with the Trust (the "Cash Custody Agreement"), the Cash Custodian will establish and maintain cash account(s) for the Trust, and, upon instructions from the Sponsor acting on behalf of the Trust, facilitate cash transfers and cash payments from the Trust s account(s). The Staking Services Provider Coinbase Crypto Services, LLC serves as the Staking Services Provider to the extent the Sponsor determines to stake a portion of the Trust s SUI. The SUI Custodian Coinbase Custody Trust Company, LLC serves as the SUI Custodian and is a fiduciary under 100 of the New York Banking Law. The SUI Custodian is authorized to serve as the Trust s custodian under the Trust Agreement and pursuant to the terms and provisions of the Custodial Services Agreement. Under the Custodial Services Agreement by and among the SUI Custodian and the Trust, the SUI Custodian is responsible for safekeeping all of the SUI owned by the Trust. The SUI Custodian was selected by the Sponsor. The SUI Custodian is responsible for opening an account that holds the Trust s SUI (the "SUI Account"), as well as facilitating the transfer of SUI required for the operation of the Trust. The SUI Custodian is a third-party limited purpose trust company that was chartered in 2018 upon receiving a trust charter from the New York Department of Financial Services. The SUI Custodian is subject to extensive regulation and has among the longest track records in the industry of providing custodial services for digital asset private keys. The Trust s assets with the SUI Custodian are held in segregated accounts on the Sui Network, commonly referred to as "wallets," and are therefore not commingled with corporate or other customer assets. The segregated account in which the SUI Custodian will custody all of the Trust s SUI from time to time is hereinafter referred to as the Trust s "Vault Balance." The SUI Custodian will keep a substantial portion of the private keys associated with the Trust s SUI in "cold storage" or similarly secure technology (the "Cold Vault Balance"), with any remainder of the Vault Balance held as a "Hot Vault Balance." All of the Trust s assets and private keys will be held in cold storage of the SUI Custodian on an ongoing basis, but a portion of the Trust s assets may be held in hot trading wallets, from time to time, in connection with the settlement of a creation or redemption transaction. 9 After diligence investigation, the Sponsor believes that the SUI Custodian s policies, procedures, and controls for safekeeping, exclusively possessing, and controlling the Trust s SUI holdings are consistent with industry best practices to protect against theft, loss, and unauthorized and accidental use of the private keys. Although the SUI Custodian carries insurance, the SUI Custodian s insurance does not cover any loss in value to SUI and only covers losses caused by certain events such as fraud or theft and, in such covered events, it is unlikely the insurance would cover the full amount of any losses incurred by the Trust. The insurance maintained by the SUI Custodian is shared among all of the SUI Custodian s customers, is not specific to the Trust or to customers holding SUI with the SUI Custodian and may not be available or sufficient to protect the Trust from all possible losses or sources of losses. For more information on the SUI Custodian, see "Custody of the Trust s Assets" below. The Marketing Agent Foreside Global Services, LLC (the "Marketing Agent") is responsible for reviewing and approving the marketing materials prepared by the Sponsor for compliance with applicable SEC and Financial Industry Regulatory Authority ("FINRA") advertising laws, rules, and regulations. The Trust s Fees and Expenses The Trust will pay the unitary Sponsor Fee of [ ]% of the Trust s NAV (the "Sponsor Fee"). The Sponsor Fee is paid by the Trust to the Sponsor as compensation for services performed under the Trust Agreement. The Sponsor Fee will accrue daily and will be payable in SUI weekly in arrears. The Sponsor will calculate the Sponsor Fee on a daily basis by applying a [ ]% annualized rate to the Trust s NAV and the amount of SUI payable in respect of each daily accrual shall be determined by reference to the Pricing Benchmark. The Sponsor has agreed to pay all operating expenses (except for litigation expenses and other extraordinary expenses) out of the Sponsor Fee. Operating expenses assumed by the Sponsor include (i) the fee payable to the Marketing Agent for services it provides to the Trust (the "Marketing Fee"), (ii) fees to the Administrator, if any, (iii) fees to the SUI Custodian, (iv) fees to the Transfer Agent, (v) fees to the Trustee, (vi) the fees and expenses related to any future listing, trading or quotation of the Shares on any listing exchange or quotation system (including legal, marketing and audit fees and expenses), (vii) ordinary course legal fees and expenses but not litigation-related expenses, (viii) audit fees, (ix) regulatory fees, including, if applicable, any fees relating to the registration of the Shares under the 1933 Act or the Exchange Act, (x) printing and mailing costs, (xi) costs of maintaining the Sponsor s website and (xii) applicable license fees (each, a "Sponsor-paid Expense," and together, the "Sponsor-paid Expenses"), provided that any expense that qualifies as an Additional Trust Expense will be deemed to be an Additional Trust Expense and not a Sponsor-paid Expense. There is currently no predetermined cap on the aggregate amount of Sponsor-paid expenses. Should the Trust implement a predetermined cap on aggregate Sponsor-paid expenses, the Trust will notify the owners of the beneficial interests of Shares in a prospectus supplement or in its periodic Exchange Act reports, as applicable, and on the Sponsor s website. The Sponsor will not, however, assume certain extraordinary, non-recurring expenses that are not Sponsor-paid Expenses, including, but not limited to, taxes and governmental charges, expenses and costs of any extraordinary services performed by the Sponsor (or any other service provider) on behalf of the Trust to protect the Trust or the interests of Shareholders, any indemnification of the SUI Custodian, Administrator or other agents, service providers or counter-parties of the Trust, the fees and expenses related to the listing, and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters (collectively, "Additional Trust Expenses"). Of the Sponsor-paid Expenses, ordinary course legal fees and expenses shall be subject to a cap of $100,000 per annum. In the Sponsor s sole discretion, all or any portion of a Sponsor-paid Expense may be re-designated as an Additional Trust Expense if, among other reasons, the Sponsor determines that a Sponsor-paid Expense is an extraordinary, non-recurring expense of the Trust. Should such a change take place, the Trust will notify the owners of the beneficial interests of Shares in a prospectus supplement or in its periodic Exchange Act reports, as applicable, and on the Sponsor s website. Pursuant to the Trust Agreement, the Sponsor or its delegates will direct the SUI Custodian to transfer SUI from the Trust s Cold Vault Balance as needed to pay the Sponsor Fee and Additional Trust Expenses, if any. The Sponsor or its delegates will endeavor to transfer the smallest amount of SUI needed to pay applicable expenses. The Trust shall not be responsible for paying any fees or expenses associated with the transfer of SUI as needed to pay the Sponsor Fee or Additional Trust Expenses. 10 Custody of the Trust s Assets The Trust s Custodian will maintain custody of all of the Trust s SUI. The SUI Custodian provides insured safekeeping of digital assets using a multi-layer cold storage security platform designed to provide offline security of the digital assets held by the SUI Custodian. The SUI Custodian has insurance coverage as a subsidiary under its parent company, Coinbase Global, which procures fidelity (e.g. crime) insurance to protect the organization from risks such as theft of funds. Specifically, the fidelity program provides coverage for the theft of funds held in hot or cold storage. The insurance program is provided by a syndicate of industry-leading insurers. The insurance program does not cover, insure or guarantee the performance of the Trust. The SUI Custodian is not FDIC-insured. The insurance maintained by the SUI Custodian is shared among all of the SUI Custodian s customers, is not specific to the Trust or to customers holding SUI with the SUI Custodian, and may not be available or sufficient to protect the Trust from all possible losses or sources of losses. SUI may be held across multiple wallets, any of which will feature the following safety and security measures to be implemented by the SUI Custodian: Cold Storage: Cold storage in the context of SUI means keeping the reserve of SUI offline, which is a widely-used security precaution, especially when dealing with large amounts of SUI. SUI held under custodianship with the SUI Custodian will be kept in high-security, offline, multi-layer cold storage vaults. This means that the private keys, the cryptographic component that allows a user to access SUI, are stored offline on hardware that has never been connected to the internet. Storing the private key offline minimizes the risk of the SUI being stolen. All of the Trust s assets and private keys will be held in cold storage of the SUI Custodian on an ongoing basis, but a portion of the Trust s assets may be held in hot trading wallets, from time to time, in connection with the settlement of a creation or redemption transaction. In connection with creations or redemptions, the Trust will, under most circumstances, process creations and redemptions by transferring SUI from its Cold Vault Balance to and/or from a SUI Counterparty. From time to time, portions of the Trust s SUI temporarily may be held outside of cold storage in the Trading Balance maintained by Coinbase, Inc. (the "Prime Broker") or a SUI Counterparty, including in circumstances in which it is necessary in connection with creations or redemptions of Baskets or to sell SUI to pay Trust expenses. Multiple Private Keys: All private keys are securely stored using multiple layers of high-quality encryption and in Custodian-owned offline hardware vaults in secure environments. No customers or third parties are given access to the SUI Custodian s private keys. The use of multiple private keys makes retrieving SUI from the wallet more difficult and aims to further reduce the risk of hacking theft and/or robbery. Whitelisting: Transactions are only sent to vetted, known addresses. The SUI Custodian s platform supports pre-approval and test transactions. The SUI Custodian requires authentication when adding or removing addresses for whitelisting. All instructions to initiate a whitelist addition or removal must be submitted via the Coinbase Custody platform. When a whitelist addition or removal request is initiated, the initiating user will be prompted to authenticate their request using a two-factor authentication key. A consensus mechanism on the Coinbase Custody platform dictates how many approvals are required in order for the consensus to be achieved to add or remove a whitelisted address. Only when the consensus is met is the underlying transaction considered officially approved. An account s roster and user roles are maintained by the SUI Custodian in a separate log, an Authorized User List ("AUL"). Any changes to the account s roster must be reflected on an updated AUL first and executed by an authorized signatory. Audit Trails: Audit trails exist for all movement of SUI within Custodian-controlled SUI wallets and are audited annually for accuracy and completeness by an independent external audit firm. In addition to the above measures, in accordance with the Custodial Services Agreement, SUI held in custody with the SUI Custodian will be segregated from both the proprietary property of the SUI Custodian and the assets of any other customer in accounts that clearly identify the Trust as the owner of the accounts. Therefore, in the event of an insolvency of the SUI Custodian, assets held in the segregated accounts would not become property of the SUI Custodian s estate and would not be available to satisfy claims of creditors of the SUI Custodian. 11 The SUI Custodian maintains an internal audit team that performs periodic internal audits over custody operations. Systems and Organizational Control ("SOC") attestations are also performed on the SUI Custodian s services. The SOC 1 Type 2 and SOC 2 Type 2 reports produced cover private key management controls. A SOC 1 Type 2 report addresses the controls at a service organization that are likely to be relevant to user entities internal control over financial reporting. A SOC 2 Type 2 report addresses controls at a service organization relevant to security, availability, processing integrity, confidentiality, or privacy in order to support users evaluations of their own systems of internal control. The Transfer Agent will facilitate the settlement of Shares in response to the placement of creation orders and redemption orders from Authorized Participants. The Trust generally does not intend to hold cash or cash equivalents. However, there may be situations where the Trust will hold cash on a temporary basis, including in connection with the creation and redemption process. The Trust has entered into the Cash Custody Agreement, pursuant to which the Cash Custodian will establish and maintain cash account(s) for the Trust and, upon instructions from the Sponsor acting on behalf of the Trust, facilitate cash transfers and cash payments from the Trust s account(s). For more information on the Trust s custody arrangements with the SUI Custodian and the Prime Broker, see "Custody of the Trust s Assets" and "Prime Broker" below. NAV Determinations As described in more detail below in "NAV Determinations," the Administrator daily calculates its NAV and NAV per Share on each day that the Exchange is open for regular trading, as promptly as practicable after 4:00 p.m. ET, based on the Pricing Benchmark. In determining the Trust s NAV, the Administrator values the SUI held by the Trust based on the price set by the Pricing Benchmark as of 4:00 p.m. ET. The Sponsor believes that use of the Pricing Benchmark mitigates against idiosyncratic market risk, as the failure of any individual spot market will not materially impact pricing for the Trust. It also allows the Administrator to calculate the NAV in a manner that significantly deters manipulation. However, determining the value of the Trust s SUI using the Pricing Benchmark is not in accordance with U.S. generally accepted accounting principles ("GAAP"), and therefore, the Pricing Benchmark is not used in the Trust s financial statements. The Trust s SUI are carried, for financial statement purposes, at fair value, as required by GAAP. As promptly as practicable after 4:00 p.m. ET, the Trust determines the fair value of SUI based on the price provided by the SUI market that the Trust considers its "principal market" as of 4:00 p.m. ET on the valuation date. The NAV of the Trust determined on a GAAP basis is referred to in this Prospectus as a "Principal Market NAV," and the NAV of the Trust per Share determined on a GAAP basis is referred to as "Principal Market NAV per Share." NAV and NAV per Share are not measures calculated in accordance with GAAP and are not intended as a substitute for the Principal Market NAV and Principal Market NAV per Share, respectively. Plan of Distribution; Selling Shareholder Barring the liquidation of the Trust or extraordinary circumstances (including but not limited to, non-recurring expenses and costs of services performed by the Sponsor or a service provider on behalf of the Trust to protect the Trust or the interests of Shareholders, such as in connection with any fork of the Sui Network, any indemnification of agents, service providers or counterparties of the Trust and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters), the Trust will not purchase or sell SUI other than in connection with the creation and redemption of Shares. The Sponsor may also sell SUI to pay certain expenses, which may be facilitated by the Prime Broker or any other prime brokers with whom the Trust contracts. 12 When the Trust sells or redeems its Shares, SUI will be transferred into or out of the Trust, as applicable, in exchange for Baskets that are based on the quantity of SUI attributable to each Share of the Trust (net of accrued but unpaid Sponsor Fees and any accrued but unpaid extraordinary expenses or liabilities). Authorized Participants may purchase Shares in cash by depositing cash in the Trust s account with the Cash Custodian. This will cause the Sponsor, on behalf of the Trust, to automatically instruct a SUI Counterparty to (i) purchase the amount of SUI equivalent in value to the cash deposit amount associated with the order and (ii) deposit the resulting SUI deposit amount in the Trust s account with the SUI Custodian, resulting in the Transfer Agent crediting the applicable amount of Shares to the Authorized Participant. Authorized Participants may also purchase Shares in-kind. To purchase Shares in-kind, an Authorized Participant delivers, or arranges for the delivery by an Authorized Participant s designated agent of, SUI to the Trust s account with the SUI Custodian in exchange for Shares. When such an Authorized Participant redeems its Shares in cash, the Sponsor, on behalf of the Trust will direct the SUI Custodian to transfer SUI to the SUI Counterparty, who will sell the SUI to be executed, in the Sponsor s reasonable efforts, at the Pricing Benchmark price used by the Trust to calculate NAV, taking into account any spread, commissions, or other trading costs and deposit the cash proceeds of such sale in the Trust s account with the Cash Custodian for settlement with the Authorized Participant. Any slippage incurred (including, but not limited to, any trading fees, spreads, or commissions), on a cash equivalent basis, will be the responsibility of the Authorized Participant and not of the Trust or Sponsor. Authorized Participants may also redeem Shares in-kind. When such an Authorized Participant redeems Shares in-kind, the Trust, through the SUI Custodian, will deliver SUI to the Authorized Participant, or a designated agent thereof, in exchange for its Shares. The Initial Seed Creation Investor, in its capacity as the Selling Shareholder, may sell some or all of the Shares pursuant to the registration statement that this Prospectus forms a part, which Shares will have been registered to permit the resale from time to time after purchase. The Shares offered by the Selling Shareholder were acquired by the Selling Shareholder as described in the registration statement and could be sold at different times and at different offering prices. The Trust will not receive any of the proceeds from the resale or redemption by the Selling Shareholder of these Shares. The Sponsor will not receive from the Trust or any of its affiliates any fee or other compensation in connection with the resale of these Shares. The Trust and/or Sponsor will bear the expense and risk of delivery and ownership of SUI once such SUI has been received by the SUI Custodian on behalf of the Trust and until transferred by the SUI Custodian on behalf of the Trust to the SUI Counterparty for conversion to cash. Only Authorized Participants may purchase Shares from or redeem Shares to the Trust. Authorized Participants may then offer Shares to the public at prices that depend on various factors, including the supply and demand for Shares, the value of the Trust s assets, and market conditions at the time of a transaction. Shareholders who buy or sell Shares during the day from their broker may do so at a premium or discount relative to the NAV of the Shares of the Trust. Shareholders who decide to buy or sell Shares of the Trust will place their trade orders through their brokers and will incur customary brokerage commissions and charges. Prior to this offering, there has been no public market for the Shares. The Shares are expected to be listed for trading, subject to notice of issuance, on the Exchange under the ticker symbol "[ ]". The Sponsor may enter into marketing support arrangements with respect to the Trust, to which the Trust would not be party. Any fees under such agreements would be payable by the Sponsor, as applicable, and not by the Trust. Federal Income Tax Considerations It is expected that an owner of Shares will be treated, for U.S. federal income tax purposes, as if they owned a proportionate share of the assets of the Trust. A shareholder will accordingly include in the computation of their taxable income their proportionate share of the income (including staking income, as applicable) and expenses realized by the Trust. Each sale or other disposition of SUI by the Trust (including, under current Internal Revenue Service ("IRS") guidance, the use or sale of SUI to pay expenses of the Trust) will give rise to gain or loss and will therefore constitute a taxable event for Shareholders. See "United States Federal Income Tax Consequences — Taxation of U.S. Shareholders." Use of Proceeds Proceeds received by the Trust from the issuance of Baskets consist of SUI. Such deposits are held by the SUI Custodian on behalf of the Trust until (i) delivered out in connection with redemptions of Baskets; or (ii) transferred or sold by the Sponsor, which may be facilitated by the SUI Custodian, to pay fees due to the Sponsor and Trust expenses and liabilities not assumed by the Sponsor. 13 Emerging Growth Company The Trust is an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"). For as long as the Trust is an emerging growth company, unlike other public companies, it will not be required to, among other things: (i) provide an auditor s attestation report on management s assessment of the effectiveness of our system of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002; or (ii) comply with any new audit rules adopted by the Public Company Accounting Oversight Board ("PCAOB") after April 5, 2012, unless the SEC determines otherwise. The Trust will cease to be an "emerging growth company" upon the earliest of (i) it having $1.235 billion or more in gross annual revenues, (ii) at least $700 million in market value of Common Shares being held by non-affiliates, (iii) it issuing more than $1.0 billion of non-convertible debt over a three-year period or (iv) the last day of the fiscal year following the fifth anniversary of its initial public offering. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the 1933 Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. The Trust intends to take advantage of the benefits of the extended transition period. Principal Investment Risks of an Investment in the Trust An investment in the Trust involves a high degree of risk. Any investment made in the Trust may result in a total loss of the investment. There is no assurance that the Trust will generate a profit for investors. Some of the risks you may face are summarized below. A more extensive discussion of these risks appears beginning on page 17. Risks Associated with SUI and the Sui Network: The value of the Shares relates directly to the price of SUI, which may be highly volatile and subject to fluctuations due to a number of factors. SUI is a relatively new technological innovation with a limited operating history. The Sui Network s distributed governance structure may negatively affect its ability to grow and respond to challenges. Newly created SUI and their subsequent sale may cause the price of SUI to decline, which could negatively affect an investment in the Trust. The prevailing level of transaction fees and the speed at which transactions are settled on may adversely affect the Sui Network. The significant holdings of SUI by early stakeholders could have an adverse effect on the price of SUI. A determination that SUI or any other digital asset is offered and sold as a "security" may adversely affect the price of SUI and the value of the Shares, and result in potentially extraordinary, nonrecurring expenses to, or termination of, the Trust. The trading prices of many digital assets, including SUI, have experienced extreme volatility in recent periods and may continue to do so. Extreme volatility in the future, including further decline in the trading prices of SUI, could have a material adverse effect on the value of the Shares and the Shares could lose all or substantially all of their value. 14 A temporary or permanent "fork" or a "clone" could adversely affect the value of the Shares. Spot markets on which SUI trades are relatively new and largely unregulated. Authorized Participants may act in the same or similar capacity for other competing products. Spot markets may be exposed to security breaches, fraud and manipulation and front-running. Risks Associated with Investing in the Trust The value of the Shares may be influenced by a variety of factors unrelated to the value of SUI. The NAV or Principal Market NAV may not always correspond to the market price of SUI and, as a result, Creation Baskets may be created or redeemed at a value that is different from the market price of the Shares. The inability of Authorized Participants and market makers to hedge their SUI exposure may adversely affect the liquidity of Shares and the value of an investment in the Shares. The Trust is subject to risks due to its concentration of investments in a single asset. Possible illiquid markets may exacerbate losses or increase the variability between the Trust s NAV or the Principal Market NAV and its market price. The amount of SUI represented by the Shares is expected to decline over time. The Administrator is solely responsible for determining the value of the SUI holdings and SUI holdings per Share, and any errors, discontinuance or changes in such valuation calculations may have an adverse effect on the value of the Shares. The use of cash creations and redemptions, as opposed to in-kind creations and redemptions, may adversely affect the arbitrage transactions by Authorized Participants intended to keep the price of the Shares closely linked to the price of SUI and, as a result, the price of the Shares may fall or otherwise diverge from NAV. If the process of creation and redemption of Baskets encounters any unanticipated difficulties, the possibility for arbitrage transactions by Authorized Participants intended to keep the price of the Shares closely linked to the price of SUI may not exist and, as a result, the price of the Shares may fall or otherwise diverge from NAV. Risks Associated with the Regulatory Environment of SUI Future and current regulations by a United States or foreign government or quasi-governmental agency could have an adverse effect on an investment in the Trust, and SUI s status as being offered and sold as a "security" under U.S. federal securities laws remains unsettled. Shareholders do not have the protections associated with ownership of Shares in an investment company registered under the 1940 Act or the protections afforded by the Commodity Exchange Act, as amended (the "CEA"). 15 Future legal or regulatory developments may negatively affect the value of SUI or require the Trust or the Sponsor to become registered with the SEC or Commodity Futures Trading Commission ("CFTC"), which may cause the Trust to incur unforeseen expenses or liquidate. If regulatory changes or interpretations of an Authorized Participant s, the Trust s or the Sponsor s activities require the regulation of an Authorized Participant, the Trust or the Sponsor as a money service business under the regulations promulgated by the Financial Crimes Enforcement Network ("FinCEN"), an Authorized Participant, the Trust or the Sponsor may be required to register and comply with such regulations, which could result in extraordinary, recurring and/or nonrecurring expenses. Risks Associated with the Tax Treatment of SUI The ongoing activities of the Trust may generate tax liabilities for Shareholders. The tax treatment of SUI and transactions involving SUI for state and local tax purposes is not settled. A hard "fork" of the Sui Network blockchain could result in Shareholders incurring a tax liability. The tax treatment of SUI and transactions involving SUI for U.S. federal income tax purposes may change. SUI staking may result in adverse tax consequences for Shareholders. The treatment of staking in a grantor trust for U.S. federal income tax purposes is still developing. The intended tax treatment of the Trust will limit the flexibility of the Trust s investment decisions. Other Risks The Exchange on which the Shares are listed may halt trading in the Trust s Shares, which would adversely impact a Shareholder s ability to sell Shares. The market infrastructure of the SUI spot market could result in the absence of active Authorized Participants able to support the trading activity of the Trust, which would affect the liquidity of the Shares in the secondary market and make it difficult to dispose of Shares. Shareholders that are not Authorized Participants may only purchase or sell their Shares in secondary trading markets, and the conditions associated with trading in secondary markets may adversely affect Shareholders investment in the Shares. The Sponsor is leanly staffed and relies heavily on key personnel. The departure of any such key personnel could negatively impact the Trust s operations and adversely impact an investment in the Trust. Shareholders do not have the rights enjoyed by investors in certain other vehicles and may be adversely affected by a lack of statutory rights and by limited voting and distribution rights. In certain circumstances, Shareholders may vote to appoint a successor Sponsor following the Voluntary Withdrawal of the Sponsor, or to continue the Trust in certain instances of dissolution of the Trust. Shareholders shall otherwise have no voting rights with respect to the Trust. The liability of the Sponsor and the Trustee is limited, and the value of the Shares will be adversely affected if the Trust is required to indemnify the Trustee or the Sponsor. Due to the increased use of technologies, intentional and unintentional cyber-attacks pose operational and information security risks, the occurrence of which can negatively impact an investment in the Trust. 16 RISK FACTORS You should consider carefully the risks described below before making an investment decision. You should also refer to the other information included in this Prospectus, as well as information found in documents incorporated by reference in this Prospectus, before you decide to purchase any Shares. These
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+Prospectus Summary 1 Risk Factors 15 Special Note Regarding Forward-Looking Statements 35 Use of Proceeds 36 Dividend Policy 37 Capitalization 38 Dilution 39 Corporate History and Structure 40 Management s Discussion and Analysis of Financial Condition and Results of Operations 43 Industry 48 Business 62 Regulations 70 Management 77 Related Party Transactions 82 Principal Shareholders 83 Description of Share Capital 84 Shares Eligible for Future Sale 93 Material Income Tax Considerations 95 Underwriting 101 Expenses Related to this Offering 102 Legal Matters 103 Experts 104 Enforceability of Civil Liabilities 105 Where You Can Find Additional Information 107 Index to Consolidated Financial Statements F-1 i We are responsible for the information contained in this prospectus and any free writing prospectus we prepare or authorize. We have not, and the underwriter has not, authorized anyone to provide you with different information, and we and the underwriter take no responsibility for any other information others may give you. We are not, and the underwriter are not, making an offer to sell the Shares in any jurisdiction where the offer or sale is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front cover of this prospectus, regardless of the time of delivery of this prospectus or the sale of any Ordinary Shares. For investors outside the United States: Neither we nor the underwriter have done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction, other than the United States, where action for that purpose is required. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of the Ordinary Shares and the distribution of this prospectus outside the United States. Angie is an exempted company with limited liability incorporated under the laws of the Cayman Islands and a majority of our outstanding Ordinary Shares are owned by non-U.S. residents. Under the rules of the SEC we currently qualify for treatment as a "foreign private issuer". As a foreign private issuer, we will not be required to file periodic reports and financial statements with the SEC as frequently or as promptly as domestic registrants whose securities are registered under the Exchange Act. Until and including , 2026 (25 days after the date of this prospectus), all dealers that buy, sell or trade the Shares, whether or not participating in this offering, may be required to deliver a prospectus. This delivery requirement is in addition to the obligation of dealers to deliver a prospectus when acting as underwriter and with respect to their unsold allotments or subscriptions. ii CONVENTIONS THAT APPLY TO THIS PROSPECTUS Unless otherwise indicated or the context otherwise requires, all references in this prospectus to: "Amended and Restated Memorandum and Articles" refers to the amended and restated memorandum and articles of association of our Company conditional upon and with effect from the date on which the Registration Statement becomes effective; "BVI" refers to the British Virgin Islands; "Companies Act" refers to the Companies Act (as revised) of the Cayman Islands, as amended, supplemented or otherwise modified from time to time; "Company", "we", "us" and "Angie" refers to Angie Holdings Limited, an exempted Company with limited liability incorporated under the laws of the Cayman Islands on March 6, 2025, that will issue the Ordinary Shares being offered and does not include Angie International. "Controlling Shareholder" refers to Mr. Fong, our Chief Executive Officer and Chairman of the Board of Directors. See "Management" and "Principal Shareholders" for more information; "Exchange Act" refers to the U.S. Securities Exchange Act of 1934, as amended; "Group" refers to the Company and its subsidiary, Angie International; "HKD" or "HK$" refers to Hong Kong dollar(s), the lawful currency of Hong Kong; "HKRITA" refers to The Hong Kong Research Institute of Textiles and Apparel Limited, a company established under the funding of the Hong Kong Government s Innovation and Technology Commission and hosted by PolyU; "Hong Kong" refers to Hong Kong Special Administrative Region of the People s Republic of China; "Independent Third Party" refers to a person or company who or which is independent of and is not a 5% owner of, does not control and is not controlled by or under common control with any 5% owner and is not the spouse or descendant (by birth or adoption) of any 5% owner of the Company; "Memorandum and Articles" refers to the memorandum of association and the articles of association of our Company adopted on March 6, 2025; "Mr. Fong" refers to Mr. Wai Sing FONG, our Controlling Shareholder, an executive director, Chief Executive Officer and Chairman of the Board of Directors; "Ms. Fong" refers to Ms. Mei Yuk FONG, an executive director, our Chief Operating Officer and a sibling of Mr. Fong; "Nasdaq" refers to Nasdaq Stock Market LLC; "Operating Subsidiary" or "Angie International" refers to Angie International Limited, a company incorporated in Hong Kong with limited liability, a directly wholly-owned subsidiary of Angie Holdings Limited and our sole operating subsidiary in Hong Kong; "Ordinary Shares" or "Shares" refer to our ordinary shares, par value US$0.0001 per ordinary share; "our Group" or "the Group" refers to Angie Holdings Limited and the Operating Subsidiary; "PCAOB" refers to Public Company Accounting Oversight Board; "PolyU" refers to the Hong Kong Polytechnic University; "PRC" or "China" or "mainland China" refers to the People s Republic of China, excluding Hong Kong, Macau and Taiwan for the purposes of this prospectus; iii "PRC government" or "PRC authorities" or variations of such words or similar expressions, refer to the central, provincial, and local governments of all levels in mainland China, including regulatory and administrative authorities, agencies and commissions, or any court, tribunal or any other judicial or arbitral body in mainland China; "PRC laws" refer to all applicable laws, statutes, rules, regulations, ordinances and other pronouncements having the binding effect of law in mainland China; "RMB" or "Renminbi" means Renminbi, the lawful currency of the PRC; "R&D" means research and development; "SEC" or "Securities and Exchange Commission" means the United States Securities and Exchange Commission; "Securities Act" refers to the U.S. Securities Act of 1933, as amended; "U.S. dollars" or "$" or "USD" or "dollars" refers to United States dollar(s), the lawful currency of the United States. We have made rounding adjustments to some of the figures included in this prospectus. Accordingly, numerical figures shown as totals in some tables may not be an arithmetic aggregation of the figures that preceded them. Unless the context indicates otherwise, all information in this prospectus assumes no exercise by the underwriter of the over-allotment option. Angie is a holding company with operations conducted in Hong Kong through its key Operating Subsidiary in Hong Kong, Angie International. Angie International s reporting currency is Hong Kong dollars. This prospectus contains translations of Hong Kong dollars into U.S. dollars solely for the convenience of the reader. Unless otherwise noted, all translations from Hong Kong dollars to U.S. dollars and from U.S. dollars to Hong Kong dollars in this prospectus were calculated at the rate of US$1 = HK$7.8, representing the noon buying rate in The City of New York for cable transfers of HK$ as certified for customs purposes by the Federal Reserve Bank of New York on the last trading day of June 30, 2025. No representation is made that the HK$ amount represents or could have been, or could be converted, realized or settled into US$ at that rate, or at any other rate. iv PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus and does not contain all of the information you should consider before investing in the Shares. You should read the entire prospectus carefully, including "Risk Factors", "Management s Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and the related notes thereto, in each case included in this prospectus. You should carefully consider, among other things, the matters discussed in the section of this prospectus titled "Business" before making an investment decision. Unless the context otherwise requires, all references to "Angie", "we", "us", "our", the "Company", and similar designations refer to Angie Holdings Limited, an exempted company with limited liability incorporated under the laws of the Cayman Islands. Overview We are a holding company incorporated in the Cayman Islands with operations conducted in Hong Kong by our Operating Subsidiary, Angie International. We have been engaged in the provision of corporate uniforms with or without special functionalities and safety products in Hong Kong since 2015. As a supplier of corporate uniforms, we provide our customers not only with finished goods but also ancillary services, including design, tailoring and functionality counseling. Our Competitive Strengths We believe the following competitive strengths differentiate us from our competitors: Established track record in the corporate uniform industry in Hong Kong; Complete but flexible and effective supply chain; Implementation of stringent quality assurance system; Collaboration with a reputable university in Hong Kong in R&D of new functional fabrics and mobile applications; and Experienced and professional management team. Our Strategies We intend to pursue the following strategies to further expand our business: Strengthening R&D capabilities; Expanding overseas presences; and Increasing spending on marketing and branding. Corporate History and Structure Angie was incorporated as an exempted company with limited liability under the laws of the Cayman Islands in March 2025. Angie s direct subsidiary is Angie International, which was incorporated as a company with limited liability under the laws of Hong Kong in June 2015. - 1 - The chart below illustrates our corporate structure and identifies our subsidiary as of the date of this prospectus: The chart below illustrates our corporate structure and identifies our subsidiary upon completion of this offering (assuming the underwriter does not exercise the over-allotment option): - 2 - Upon the completion of this offering, 15,250,000 Ordinary Shares will be outstanding assuming the underwriter does not exercise the over-allotment option. Angie will be a "controlled company" as defined under the Nasdaq Stock Market Rules because, immediately after the completion of this offering, Mr. Fong, the Controlling Shareholder will own an aggregate of 11,970,000 issued and outstanding Ordinary Shares through Visionary Value Investments Ltd. and Nexus Capital Development Ltd., representing approximately 78.49% of the total voting power. Mr. Fong is our Chief Executive Officer and Chairman of the Board of Directors. Mr. Fong will have the ability to control matters requiring shareholder approval, including the election of directors, amendment of organizational documents, and approval of major corporate transactions, such as a change in control, merger, consolidation, or sale of assets. In addition, given that Ms. Fong, an executive director and our Chief Operating Officer will own 665,000 of the total issued and outstanding Ordinary Shares through Stellar Wealth Development Ltd., representing approximately 4.36% of the total voting power, is a sibling of Mr. Fong, such family relationship will further concentrate share ownership among company management. Holding Company Structure Angie is a Cayman Islands holding company with no material operations of its own, and we conduct our operations primarily in Hong Kong through the Operating Subsidiary. This is an offering of the Ordinary Shares of Angie, an exempted company with limited liability incorporated under the laws of the Cayman Islands, instead of the shares of the Operating Subsidiary. Investors in this offering will not directly hold any equity interests in the Operating Subsidiary. As a result of our corporate structure, Angie s ability to pay dividends may depend upon dividends paid by the Operating Subsidiary. If our Operating Subsidiary or any newly formed ones incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us. This holding structure involves unique risks to investors as the Chinese regulatory authorities could disallow this structure, which would likely result in a material change in our operations and/or a material change in the value of the securities which are registered for sale, including that it could cause the value of such securities to significantly decline or become worthless. Please refer to page 27 below for further details. Transfers of Cash To and From Our Subsidiary Our management monitors the cash position of the Operating Subsidiary regularly and prepares budgets on a monthly basis to ensure it has the necessary funds to fulfil its obligations for the foreseeable future and to ensure adequate liquidity. In the event that there is a need for cash or a potential liquidity issue, it will be reported to our Chief Financial Officer and subject to approval by the board of directors. No regulatory approval is required for Angie to transfer cash to its subsidiary. Angie is permitted under the laws of the Cayman Islands and its Amended and Restated Memorandum and Articles to provide funding to our Operating Subsidiary through loans or capital contributions. However, to the extent cash in the business is in Hong Kong or a Hong Kong entity, the funds may not be available to fund operations or for other use outside of Hong Kong due to interventions in or the imposition of restrictions and limitations on the ability of the Company and its subsidiaries by the PRC government to transfer cash. The ability of our Operating Subsidiary to transfer cash to Angie is subject to the following condition: according to the Companies Ordinance of Hong Kong, our Operating Subsidiary may only make a distribution out of profits available for distribution. Other than the above, we did not adopt or maintain any cash management policies and procedures as of the date of this prospectus, hence no summary and setting out of the policies and the relevant procedures are available. During the years ended December 31, 2024 and 2023 and the six months ended June 30, 2025 and up to the date of this prospectus, our Operating Subsidiary and Angie did not declare or pay any dividends and there was no transfer of assets between Angie and its Operating Subsidiary. However, our Operating Subsidiary paid constructive dividends, which are economic benefits conferred on a shareholder without a dividend being formally declared, of $971,000 in FY 2024, $1,190,621 in FY2023 and $208,952 in the six months ended June 30, 2025 to Ms. Fong. There is no tax implication in relation to the constructive dividends received by Ms. Fong in Hong Kong (see F-24 below). If we determine to pay dividends on any of the Shares in the future, as a holding company, we will be dependent on receipt of funds from our Operating Subsidiary by way of dividend payments. Angie is permitted under the laws of Cayman Islands and its Amended and Restated Memorandum and Articles to provide funding to its subsidiary through loans or capital contributions. The Operating Subsidiary is permitted under the laws of Hong Kong to provide funding to Angie through dividend distributions without restrictions on the amount of the funds distributed. We currently intend to retain all available funds and future earnings, if any, for the operation and expansion of our business and do not anticipate declaring or paying any dividends in the foreseeable future. Subject to the Cayman Islands laws and our Amended and Restated Memorandum and Articles, our board of directors has complete discretion as to whether to distribute dividends. In addition, our shareholders may by ordinary resolution declare a dividend, but no dividend may exceed the amount recommended by our directors. Under Cayman Islands law, a Cayman Islands company may pay a dividend out of either profit or share premium account, provided that in no circumstances may a dividend be paid if this would result in the company being unable to pay its debts as they fall due in the ordinary course of business. Even if our board of directors decides to declare and pay dividends, the timing, amount and form of future dividends, if any, will depend on our future results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us from the operating entities, our financial condition, contractual restrictions and other factors deemed relevant by our board of directors. Any of these factors could have a material adverse effect on our business, financial position and results of operations, and hence there is no assurance that we will be able to pay dividends to our shareholders after the completion of the IPO. The Cayman Islands does not impose a withholding tax on payments of dividends to shareholders in the Cayman Islands. - 3 - Under Hong Kong law, dividends could only be paid out of distributable profits (that is, accumulated realized profits less accumulated realized losses) or other distributable reserves, as permitted under Hong Kong law. Dividends cannot be paid out of share capital. There are no restrictions or limitation under the laws of Hong Kong imposed on the conversion of HK dollar into foreign currencies and the remittance of currencies out of Hong Kong, nor there is any restriction on foreign exchange to transfer cash between Angie and its subsidiary, across borders and to U.S. investors, nor there is any restrictions and limitations to distribute earnings from our business and subsidiary, to Angie and U.S. investors and amounts owed. Under the current practice of the Inland Revenue Department of Hong Kong, no tax is payable in Hong Kong in respect to dividends paid by us. Since Hong Kong is a special administrative region of the PRC and the basic policies of the PRC regarding Hong Kong are reflected in the Basic Law of the Hong Kong Special Administrative Region of the People s Republic of China, or the Basic Law, providing Hong Kong with a high degree of autonomy and executive, legislative and independent judicial powers, including that of final adjudication under the principle of "one country, two systems". The PRC laws and regulations do not currently have any material impact on transfer of cash from Angie to our Operating Subsidiary nor from our Operating Subsidiary to Angie and the investors in the U.S. There is currently no restriction or limitation under the laws and regulations of the PRC on currency conversion control do not currently have any material impact on the transfer of cash between the ultimate holding company and our Operating Subsidiary in Hong Kong. However, the PRC government may, in the future, impose restrictions or limitations on our ability to move money out of Hong Kong to distribute earnings and pay dividends to and from the other entities within our organization or to reinvest in our business outside of Hong Kong. Such restrictions and limitations, if imposed in the future, may delay or hinder the expansion of our business to outside of Hong Kong and may affect our ability to receive funds from our Operating Subsidiary in Hong Kong. The promulgation of new laws or regulations, or the new interpretation of existing laws and regulations, in each case, that restrict or otherwise unfavorably impact our ability to conduct our business could require us to change certain aspects of our business to ensure compliance; decrease demand for our services; reduce revenues; increase costs; require us to obtain more licenses, permits, approvals, or certificates; or subject us to additional liabilities. To the extent any new or more stringent measures are implemented, our business, financial condition, and results of operations could be adversely affected and the value of our Ordinary Shares could decrease or become worthless. See "Dividend Policy", "Risk Factors — We rely on dividends and other distributions on equity paid by our subsidiary to fund any cash and financing requirements we may have, and any limitation on the ability of our subsidiary to make payments to us could have a material adverse effect on our ability to conduct our business", "Risk Factors — Our key operations are in Hong Kong, a Special Administrative Region of the PRC. According to the long-arm provisions under the current PRC laws and regulations, the PRC government may exercise significant oversight and discretion over the conduct of our business and may intervene in or influence our operations at any time, which could result in a material change in our operations and/or the value of the Shares. The PRC government may intervene or impose restrictions on our ability to move money out of Hong Kong to distribute earnings and pay dividends or to reinvest in our business outside of Hong Kong. Changes in the policies, regulations, rules, and the enforcement of laws of the PRC government may also be quick with little advance notice and our assertions and beliefs of the risk imposed by the PRC legal and regulatory system cannot be certain", and Consolidated Statements of Change in Shareholders Equity in the audited financial statements contained in this prospectus for more information. Enforceability of Civil Liabilities We are incorporated under the laws of the Cayman Islands as an exempted company with limited liability. We are incorporated in the Cayman Islands in order to enjoy the following benefits: (a) political and economic stability; (b) an effective judicial system; (c) a favorable tax system; (d) the absence of exchange control or currency restrictions; (e) and the availability of professional and support services. However, certain disadvantages accompany incorporation in the Cayman Islands. These disadvantages include: (a) the Cayman Islands has a less exhaustive body of securities laws than the United States and these securities laws provides less protection to investors; and (b) the Cayman Islands companies may not have standing to sue before the federal courts of the United States. All of our assets are located in Hong Kong. In addition, all of our directors and officers are citizens and/or residents of Hong Kong and all or a substantial portion of their assets are located outside the United States. Due to the lack of reciprocity and treaties between the United States and Hong Kong, together with cost and time constraints, it may be difficult for investors to effect service of process within the United States upon us or the persons who are citizens or residents of Hong Kong, or to enforce against us or them judgments obtained in United States courts, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States. Our constitutional documents do not contain provisions requiring that disputes, including those arising under the securities laws of the United States, among us, our officers, directors and shareholders, be arbitrated. We have appointed Cogency Global Inc. as our agent upon whom process may be served in any action brought against us under the securities laws of the United States. - 4 - Ogier, our counsel as to the laws of the Cayman Islands, has advised us that although there is no statutory enforcement in the Cayman Islands of judgments obtained in the federal or state courts of the United States (and the Cayman Islands are not a party to any treaties for the reciprocal enforcement or recognition of such judgments), the Grand Court of the Cayman Islands will at common law enforce final and conclusive in personam judgments of state and/or federal courts of the United States of America (the "Foreign Court") of a debt or definite sum of money against the Company (other than a sum of money payable in respect of taxes or other charges of a like nature, a fine or other penalty (which may include a multiple damages judgment in an anti-trust action) or where enforcement would be contrary to public policy). The Grand Court of the Cayman Islands will also at common law enforce final and conclusive in personam judgments of the Foreign Court that are non-monetary against the Company, e.g., declaratory judgments ruling upon the true legal owner of shares in a Cayman Islands company. The Grand Court of the Cayman Islands will exercise its discretion in the enforcement of non-money judgments by having regard to the circumstances, such as considering whether the principles of comity apply. To be treated as final and conclusive, any relevant judgment must be regarded as res judicata by the Foreign Court. A debt claim on a foreign judgment must be brought within six years of the date of the judgment, and arrears of interest on a judgment debt cannot be recovered after six years from the date on which the interest was due. The courts of the Cayman Islands are unlikely to enforce a judgment obtained from the Foreign Court under civil liability provisions of U.S. federal securities law if such a judgment is found by the courts of the Cayman Islands to give rise to obligations to make payments that are penal or punitive in nature. Such a determination has not yet been made by the Grand Court of the Cayman Islands. A court of the Cayman Islands may stay enforcement proceedings if concurrent proceedings are being brought elsewhere. A judgment entered in default of appearance by a defendant who has had notice of the Foreign Court s intention to proceed may be final and conclusive notwithstanding that the Foreign Court has power to set aside its own judgment and despite the fact that it may be subject to an appeal the time-limit for which has not yet expired. The Grand Court of the Cayman Islands may safeguard the defendant s rights by granting a stay of execution pending any such appeal and may also grant interim injunctive relief as appropriate for the purpose of enforcement. Substantially all of our assets are located outside the United States. In addition, most of our directors and executive officers are nationals or residents of jurisdictions other than the United States and substantially all of their assets are located outside the United States. As a result, it may be difficult for a shareholder to effect service of process within the United States upon us or these persons, or to enforce judgments obtained in U.S. courts against us or them, including judgments predicated upon the civil liability provisions of the securities laws of the United States, or any state in the United States. It may also be difficult for you to enforce judgments obtained in U.S. courts based on the civil liability provisions of the U.S. federal securities laws against us and our executive officers and directors. Directors and Executive officers Age Position Wai Sing FONG 39 Chairman of the Board of Directors and Chief Executive Officer Mei Yuk FONG 36 Director and Chief Operating Officer Wing Hang CHAN 48 Chief Financial Officer Yan Fai LEE 41 Independent Director Appointee Pik Yin MOK 52 Independent Director Appointee Ngo Yin TSANG 51 Independent Director Appointee All of our directors and officers reside outside the United States in Hong Kong. TWSL Partners, our counsel as to the laws of Hong Kong, has advised us that there is uncertainty as to whether the courts of Hong Kong would (i) recognize or enforce judgments of U.S. courts obtained against us or our directors or officers predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States, or (ii) entertain original actions brought in Hong Kong against us or our directors or officers predicated upon the securities laws of the United States or any state in the United States. A judgment of a court in the United States predicated upon U.S. federal or state securities laws may be enforced in Hong Kong at common law by bringing an action in a Hong Kong court on that judgment for the amount due thereunder, and then seeking summary judgment on the strength of the foreign judgment, provided that the foreign judgment, among other things, is (1) for a debt or a definite sum of money (not being taxes or similar charges to a foreign government taxing authority or a fine or other penalty), and (2) final and conclusive on the merits of the claim, but not otherwise. Such a judgment may not, in any event, be so enforced in Hong Kong if (a) it was obtained by fraud, (b) the proceedings in which the judgment was obtained were opposed to natural justice, (c) its enforcement or recognition would be contrary to the public policy of Hong Kong, (d) the court of the United States was not jurisdictionally competent, or (e) the judgment was in conflict with a prior Hong Kong judgment. Hong Kong has no arrangement for the reciprocal enforcement of judgments with the United States. As a result, there is uncertainty as to the enforceability in Hong Kong, in original actions or in actions for enforcement, of judgments of U.S. courts of civil liabilities predicated solely upon the federal securities laws of the United States or the securities laws of any state or territory within the United States. It is also uncertain whether, in the future, the Hong Kong government will implement regulations and policies of the Chinese government or adopt regulations and policies of its own that are substantially similar to those of the Chinese government. - 5 - Summary of Key Risks Our business is subject to a number of risks, including risks that may prevent us from achieving our business objectives or may materially and adversely affect our business, financial condition, results of operations, cash flows, and prospects that you should consider before
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+Prospectus Summary Founder shares conversion and anti-dilution rights. If we raise additional funds through equity or convertible debt issuances, our public shareholders may suffer significant dilution. This dilution would increase to the extent that the anti-dilution provision of the founder shares result in the issuance of Class A ordinary shares on a greater than one-for-one basis upon conversion of the founder shares at the time of our initial business combination. Pursuant to a letter agreement to be entered with us, each of our sponsor, directors and officers has agreed to restrictions on its ability to transfer, assign, or sell the founder shares and private placement units, as summarized in the table below. Subject Securities Expiration Date Natural Persons and Entities Subject to Restrictions Exceptions to Transfer Restrictions Founder shares The earlier of (A) six months after the completion of our initial business and (B) the date following the completion of our initial business combination on which we complete a liquidation, merger, share exchange or other similar transaction that results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property. SC Capital II Sponsor LLC Nukkleus Defense Technologies, Inc. Menachem Shalom Asaf Yarkoni Seth Farbman Rachel Vidal Regev Yariv Cohen Transfers permitted (a) to our officers, directors, advisors or consultants, any affiliate or family member of any of our officers, directors, advisors or consultants, any members or partners of the sponsor or their affiliates and funds and accounts advised by such members or partners, any affiliates of the sponsor, or any employees of such affiliates; (b) in the case of an individual, as a gift to such person s immediate family or to a trust, the beneficiary of which is a member of such person s immediate family, an affiliate of such person or to a 9 Table of Contents Subject Securities Expiration Date Natural Persons and Entities Subject to Restrictions Exceptions to Transfer Restrictions charitable organization; (c) in the case of an individual, by virtue of laws of descent and distribution upon death of such person; (d) in the case of an individual, pursuant to a qualified domestic relations order; (e) by private sales or transfers made in connection with any forward purchase agreement or similar arrangement, in connection with an extension of the completion window or in connection with the consummation of a business combination at prices no greater than the price at which the shares or Share Rights were originally purchased; (f) pro rata distributions from our sponsor to its respective members, partners or shareholders pursuant to our sponsor s limited liability company agreement or other charter documents; (g) by virtue of the laws of the Cayman Islands or our sponsor s limited liability company agreement upon dissolution of our sponsor; (h) in the event of our liquidation prior to our consummation of our initial business combination; (i) in the event that, subsequent to our consummation of an initial business combination, we complete a liquidation, merger, share exchange or other similar transaction which results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property; or (j) to a nominee or custodian of a person or entity to whom a transfer would be permissible under clauses (a) through (g); provided, however, that in the case of clauses (a) through (g) and clause (j) these permitted transferees must enter into a written agreement agreeing to be bound by these transfer restrictions and the other restrictions contained in the letter agreement. 10 Table of Contents Subject Securities Expiration Date Natural Persons and Entities Subject to Restrictions Exceptions to Transfer Restrictions Private placement units (including underlying securities) 30 days after the completion of our initial business combination SC Capital II Sponsor LLC Nukkleus Defense Technologies, Inc. Menachem Shalom Asaf Yarkoni Seth Farbman Rachel Vidal Regev Yariv Cohen Same as above Any units, Share Rights, ordinary shares or any other securities convertible into, or exercisable or exchangeable for, any units, ordinary shares, founder shares or rights 180 days from the date of this prospectus SC Capital II Sponsor LLC Nukkleus Defense Technologies, Inc. Menachem Shalom Asaf Yarkoni Seth Farbman Rachel Vidal Regev Yariv Cohen We, our sponsor and our officers and directors have agreed that, for a period of 180 days from the date of this prospectus, we and they will not, without the prior written consent of the representative of the underwriters, offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, any units, Share Rights, shares or any other securities convertible into, or exercisable, or exchangeable for, shares, subject to certain exceptions. The representative in its sole discretion may release any of the securities subject to these lock-up agreements at any time without notice, other than in the case of the officers and directors, which shall be with notice. Our sponsor, officers and directors are also subject to separate transfer restrictions on their founder shares and private placement units pursuant to the letter agreement described in the immediately preceding paragraphs. Up to 964,286 of the founder shares will be surrendered for no consideration depending on the extent to which the underwriters over-allotment option is exercised. In addition, in order to facilitate our initial business combination as determined by our sponsor in its sole discretion, our sponsor may surrender or forfeit, transfer or exchange our founder shares, private placement units or any of our other securities, including for no consideration, as well as subject any such securities to earn-outs or other restrictions, or otherwise amend the terms of any such securities or enter into any other arrangements with respect to any such securities. We may also issue Class A ordinary shares upon conversion of the Class B ordinary shares at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions as set forth therein. Pursuant to the letter agreement to be entered with us, each of our sponsor, directors and officers have agreed to a lock-up and restrictions on their ability to transfer, assign, or sell the founder shares and private placement units and securities underlying the private placement units. Further, the sponsor membership interests (including the interests held by the non-managing members) are locked up and not transferable because the letter agreement prohibits indirect transfers. 11 Table of Contents Our letter agreement may be amended without shareholder approval. Such transfer restrictions have been amended in connection with business combinations for certain other special purpose acquisition companies. While we do not expect our board to approve any amendment to the letter agreement prior to our initial business combination, it may be possible that our board, in exercising its business judgment and subject to its fiduciary duties, chooses to approve one or more amendments to the letter agreement. While non-managing members will not be a direct party to the letter agreement discussed, as a result of their ownership of membership interests in the sponsor, they will be bound by the restrictions set forth above with respect to their allocated founder shares, the private placement units and securities underlying the private placement units (including the restriction on transfer of their membership interests because the letter agreement prohibits indirect transfers). However, the non-managing sponsor investors will not be subject to transfer restrictions or a lock-up agreement on any public units, public shares or Share Rights that they may purchase in this offering or thereafter. See Principal Shareholders Restrictions on Transfers of Founder Shares and Private Placement Units. Potential Additional Financings We may need to obtain additional financing to complete our initial business combination, either because the transaction requires more cash than is available from the proceeds held in our trust account or because we become obligated to redeem a significant number of our public shares upon completion of the business combination, in which case we may issue additional securities or incur debt in connection with such business combination. If we raise additional funds through equity or convertible debt issuances, our public shareholders may suffer significant dilution and these securities could have rights that rank senior to our public shares. If we raise additional funds through the incurrence of indebtedness, such indebtedness would have rights that are senior to our equity securities and could contain covenants that restrict our operations. Further, as described above, due to the anti-dilution rights of our founder shares, our public shareholders may incur material dilution. In addition, we intend to target businesses with enterprise values that are greater than we could acquire with the net proceeds of this offering and the sale of the private placement units, and, as a result, if the cash portion of the purchase price exceeds the amount available from the trust account, net of amounts needed to satisfy any redemptions by public shareholders, we may be required to seek additional financing to complete such proposed initial business combination. We may also obtain financing prior to the closing of our initial business combination to fund our working capital needs and transaction costs in connection with our search for and completion of our initial business combination. There is no limitation on our ability to raise funds through the issuance of equity or equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements or backstop agreements we may enter into following consummation of this offering. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our initial business combination. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to liquidate the trust account. In addition, following our initial business combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations. See Proposed Business Potential Additional Financing. Our Business Combination Process In evaluating a prospective target business, we expect to conduct a due diligence review which may encompass, among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities, as applicable, as well as a review of financial, operational, legal and other information about the target and its industry which will be made available to us. If we determine to move forward with a particular target, we will proceed to structure and negotiate the terms of the business combination transaction. The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of, and negotiation with, a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the funds available for us to use to complete another business combination. Certain of our directors and officers will, directly or indirectly, own founder shares and/or private placement units following this offering and, accordingly, may have a conflict of interest, in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, such officers 12 Table of Contents and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. For additional information regarding our executive officers and directors business affiliations and potential conflicts of interest, see Management Directors, Director Nominees and Executive Officers and Management Conflicts of Interest. Our sponsor, including Nukkleus, and certain of our officers and directors are, and may in the future become, affiliated with entities (including Kochav Defense Acquisition Corp., other SPACs, operating companies or investment entities) that are engaged in a similar business to us. We do not have employment contracts with our officers and directors that will limit their ability to work at other businesses. In addition, our sponsor, officers and directors, including Nukkleus, may participate in the formation of, or become a sponsor, officer or director of, any other blank check company prior to completion of our initial business combination. As a result, our sponsor, officers and directors, including Nukkleus, could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for one or more entities to which he or she has fiduciary, contractual or other obligations or duties, he or she may honor these obligations and duties to present such business combination opportunity to such entities first, and only present it to us if such entities reject the opportunity and he or she determines to present the opportunity to us (unless such opportunity was presented to such individuals in his or her capacity as an officer or director of our company), subject to their fiduciary duties under Cayman Islands law. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by law: (i) no individual serving as a director or an officer, among other persons, shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us, and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which (a) may be a corporate opportunity for any director or officer, on the one hand, and us, on the other or (b) the presentation of which would breach an existing legal obligation of a director or officer to any other entity. Additionally, neither Nukkleus, which controls our sponsor, nor any other entity currently has any obligation or duty to provide us with any potential business combination opportunity. In addition, Nukkleus will require that any business combination opportunity that is a corporate opportunity of Nukkleus that may also be a business combination opportunity for our company will first be presented to the board of directors of Nukkleus for consideration as to whether Nukkleus desires to pursue such business combination opportunity as a direct investment or to present such opportunity to our company for consideration. A decision by Nukkleus to pursue an opportunity would preclude us from pursuing it and could have a negative impact on our ability to complete our initial business combination. These conflicts may not be resolved in our favor and a potential target business may be presented to another entity prior to its presentation to us. As a result, the fiduciary duties or contractual obligations of our officers or directors could materially affect our ability to complete our initial business combination. Initial Business Combination We are not presently engaged in, and we will not engage in, any operations for an indefinite period of time following this offering. We intend to effectuate our initial business combination using cash from the proceeds of this offering and the private placement of the private placement units, the proceeds of the sale of our shares in connection with our initial business combination (including pursuant to forward purchase agreements or backstop agreements we may enter into following the consummation of this offering or otherwise), shares issued to the owners of the target, debt issued to bank or other lenders or the owners of the target, other securities issuances, or a combination of the foregoing. We may seek to complete our initial business combination with a company or business in its early stages of development or growth, which would subject us to the numerous risks inherent in such companies and businesses. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination either (i) in connection with a general meeting called to approve the business combination or (ii) without a shareholder vote by means of a tender offer. If we seek shareholder approval, we will complete our initial business combination only if we receive an ordinary resolution under Cayman Islands law and our amended and restated memorandum and articles of association, which requires the affirmative vote of a simple majority of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at the applicable general meeting of the company, voting together as a single class. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender 13 Table of Contents offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under applicable law or stock exchange listing requirement. We will have up to 18 months from the closing of this offering (or up to 24 months from the closing of this offering if we extend the period of time to consummate a business combination by the full amount of time, as described in more detail in this prospectus) or until such earlier liquidation date as our board of directors may approve, to consummate our initial business combination. If we anticipate that we may be unable to consummate our initial business combination within the completion window), we may seek shareholder approval to amend our amended and restated memorandum and articles of association to further extend the date by which we must consummate our initial business combination. If we seek shareholder approval for an extension, holders of public shares will be offered an opportunity to redeem their shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (less income taxes, if any), divided by the number of then issued and outstanding public shares, subject to applicable law. If we are unable to complete our initial business combination within the completion window and do not hold a shareholder vote to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to consummate an initial business combination, or by such earlier liquidation date as our board of directors may approve, from the closing of this offering, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (less taxes, if any, payable and up to $100,000 of interest income to pay dissolution expenses), divided by the number of then issued and outstanding public shares, subject to applicable law and certain conditions as further described herein. We expect the pro rata redemption price to be approximately $10.00 per public share (regardless of whether or not the underwriters exercise their over-allotment option), without taking into account any interest or other income earned on such funds. However, we cannot assure you that we will in fact be able to distribute such amounts as a result of claims of creditors, which may take priority over the claims of our public shareholders. If we do not complete our initial business combination within the completion window, while we do not currently intend to seek shareholder approval to amend our amended and restated memorandum and articles of association to further extend the amount of time we will have to consummate an initial business combination, we may elect to do so in the future. There is no limit on the number of extensions that we may seek; however, we do not expect to extend the time period to consummate our initial business combination beyond 36 months from the closing of this offering. If we determine not to or are unable to extend the time period to consummate our initial business combination or fail to obtain shareholder approval to extend the completion window, our sponsor s investment in our founder shares and our private placement units will be worthless. Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding deferred underwriting commissions, if any, and taxes payable on the interest earned on the trust account). Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. While we consider it likely that our board of directors will be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of the target s assets or prospects. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest 14 Table of Contents in the post-transaction company, depending on valuations ascribed to the target and us in the business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test described above. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, including Nukkleus, officers or directors, non-managing sponsor investors, or completing the business combination through a joint venture or other form of shared ownership with our sponsor, officers or directors or non-managing sponsor investors. In the event we seek to complete our initial business combination with a company that is affiliated (as defined in our amended and restated memorandum and articles of association) with our sponsor, including Nukkleus officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions, stating that the consideration to be paid by us in such an initial business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other context. Certain members of our management team, our independent directors and Nukkleus, will directly or indirectly own founder shares and/or private placement units following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. The low price that our sponsor, executive officers and directors (directly or indirectly) paid for the founder shares creates an incentive whereby our officers and directors could potentially make a substantial profit even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. If we are unable to complete our initial business combination within the completion window, or by such earlier liquidation date as our board of directors may approve, the founder shares and the private placement units (and the securities comprising such units) may expire worthless, except to the extent they receive liquidating distributions from assets outside the trust account, which could create an incentive for our sponsor, executive officers and directors to complete a transaction even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Our sponsor, including Nukkleus, and certain of our officers and directors are, and may in the future become, affiliated with entities (including Kochav Defense Acquisition Corp., other SPACs, operating companies or investment entities) that are engaged in a similar business to us. We do not have employment contracts with our officers and directors that will limit their ability to work at other businesses. In addition, our sponsor, officers and directors may participate in the formation of, or become an officer or director of, any other blank check company prior to completion of our initial business combination. As a result, our sponsor, including Nukkleus, officers and directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for one or more entities to which he or she has fiduciary, contractual or other obligations or duties, he or she may honor these obligations and duties to present such business combination opportunity to such entities first, and only present it to us if such entities reject the opportunity and he or she determines to present the opportunity to us (unless such opportunity was presented to such individuals in his or her capacity as an officer or director of our company), subject to their fiduciary duties under Cayman Islands law. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by law: (i) no individual serving as a director or an officer, among other persons, shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us, and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which (a) may be a corporate opportunity for any director or officer, on the one hand, and us, on the other or (b) the presentation of which would breach an existing legal obligation of a director or officer to any other entity. Additionally, neither Nukkleus, which controls our sponsor, nor any other entity currently has any obligation or duty to provide us with any potential business combination opportunity. In addition, 15 Table of Contents Nukkleus will require that any business combination opportunity that is a corporate opportunity of Nukkleus that may also be a business combination opportunity for our company will first be presented to the board of directors of Nukkleus for consideration as to whether Nukkleus desires to pursue such business combination opportunity as a direct investment or to present such opportunity to our company for consideration. A decision by Nukkleus to pursue an opportunity would preclude us from pursuing it and could have a negative impact on our ability to complete our initial business combination. These conflicts may not be resolved in our favor and a potential target business may be presented to another entity prior to its presentation to us. As a result, the fiduciary duties or contractual obligations of our officers or directors could materially affect our ability to complete our initial business combination. In addition, our sponsor (including Nukkleus) and certain of our officers and directors have sponsored or formed, and may sponsor or form, other SPACs similar to ours or may pursue other business or investment ventures during the period in which we are seeking an initial business combination. See Proposed Business Our Management Team Prior SPAC Experience. As a result, our sponsor, officers and directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other SPAC with which they are or may become involved. Any such companies, businesses or investments may present additional conflicts of interest in pursuing an initial business combination target, which could materially affect our ability to complete our initial business combination. Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. Corporate Information Our executive offices are located at 575 Fifth Avenue, 14th Floor, New York, NY 10017, and our telephone number is (646) 257-4214. We are a Cayman Islands exempted company. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (Revised) of the Cayman Islands, for a period of 30 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. 16 Table of Contents We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that are held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates is equal to or exceeds $250 million as of the prior June 30, or (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates is equal to or exceeds $700 million as of the prior June 30. Finally, after completion of this offering and prior to the consummation of a business combination, only holders of our Class B ordinary shares will have the right to vote on the appointment or removal of directors. As a result, Nasdaq will consider us to be a controlled company within the meaning of Nasdaq corporate governance standards. Under Nasdaq corporate governance standards, a company of which more than 50% of the voting power for the appointment of directors is held by an individual, group or another company is a controlled company and may elect not to comply with certain corporate governance requirements. We currently do not intend to rely on the controlled company exemption, but may do so in the future. Accordingly, if we choose to do so, you will not have the same protections afforded to shareholders of companies that are subject to all of the Nasdaq corporate governance requirements. 17 Table of Contents
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@@ -0,0 +1,147 @@
+PROSPECTUS SUMMARY 
+
+ 
+
+AS USED IN THIS PROSPECTUS, UNLESS THE CONTEXT
+OTHERWISE REQUIRES, "WE," "US," "OUR," "ELVENTIX TECHNOLOGY" REFERS
+TO ELVENTIX TECHNOLOGY CORPORATION. THE FOLLOWING SUMMARY HIGHLIGHTS SELECTED INFORMATION CONTAINED IN THIS PROSPECTUS. BEFORE MAKING
+AN INVESTMENT DECISION, YOU SHOULD READ THE ENTIRE PROSPECTUS CAREFULLY, INCLUDING THE "RISK FACTORS" SECTION, THE
+FINANCIAL STATEMENTS, AND THE NOTES TO THE FINANCIAL STATEMENTS. 
+
+ 
+
+OUR COMPANY
+
+ 
+
+Elventix Technology Corporation was incorporated in
+Wyoming on March 4, 2025. We are a startup company, specializing in providing a comprehensive news services to its customers. The company s
+primary product is a digital news application designed to deliver personalized news content based on user preferences.
+
+ 
+
+Our goal is to provide users with access to curated
+news content from a variety of sources to help them efficiently find relevant information. We recognize that the volume of available online
+news can make it difficult for individuals to filter and prioritize content. Elventix Technology Corporation seeks to address this by
+delivering tools that organize and present aggregated news in a structured and user-centric format. We use algorithms and other software-based
+methods to collect articles from reputable news outlets, blogs, online publications, and other sources, with the aim of offering a broad
+and diverse selection of news content.
+
+ 
+
+ 
+
+6 | Page
+
+We are focused on delivering
+tools to improve how users access and interact with digital news content. Our objective is to provide a platform that delivers personalized
+and reliable news based on individual user preferences. We intend to enhance our product offering by incorporating technologies such as
+artificial intelligence, machine learning, and data analytics to improve content aggregation, relevance, and user experience over time.
+
+We are a startup company that
+has not realized any revenue to date, and our accumulated deficit as of May 31, 2025 is $199. To date we have raised an aggregate of $4,500
+through a private placement of our common stock to our President and Director, Tallis Mateus Da Silva. Proceeds from the private placement
+were used for working capital. Our independent auditor has issued an audit opinion for our Company which includes a statement expressing
+substantial doubt as to our ability to continue as a going concern. The Company s mail forwarding address are located at 1309
+Coffeen Avenue STE 1200 Sheridan, Wyoming 82801. Our phone number is (256) 570-1612.
+
+We plan to raise the additional funding for our twelve-month
+business plan by selling the 4,000,000 shares in this offering. We cannot provide any assurance that we will be able to sell any
+of the shares being offered to raise sufficient funds to proceed with our twelve-month business plan.
+
+We believe we are not a "shell company"
+within the meaning of Rule 405, promulgated pursuant to Securities Act, because we have more than nominal operations. 
+
+ 
+
+From inception until the date of this filing we have
+had limited operating activities, primarily consisting of the incorporation of our company, the initial equity funding by our president
+and completing our business plan. We received our initial funding of $4,500 through the sale of common stock to our President and Director,
+Tallis Mateus Da Silva, purchased an aggregate of 4,500,000 shares of common stock at a purchase price of $0.001 per share, for aggregate
+proceeds of $4,500. Tallis Mateus Da Silva, currently owns 100% of our outstanding common shares. Following this offering, Mr. Da Silva
+will continue to own a majority of our outstanding shares and, as a result, will have effective control over the company. See , ' ': Risk
+Factors — Because our sole officer and shareholder will continue to own a majority of our shares following this offering, he will
+retain effective control over the company.
+
+ 
+
+As of the date of this prospectus, there is no public
+trading market for our common stock and no assurance that a trading market for our securities will ever develop.
+
+ 
+
+We are an "emerging growth company" within
+the meaning of the federal securities laws. For as long as we are an emerging growth company, we will not be required to comply with the
+requirements that are applicable to other public companies that are not "emerging growth companies" including, but
+not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, the reduced
+disclosure obligations regarding executive compensation in our periodic reports and proxy statements and the exemptions from the requirements
+of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously
+approved. We intend to take advantage of these reporting exemptions until we are no longer an emerging growth company. For
+a description of the qualifications and other requirements applicable to emerging growth companies and certain elections that we have
+made due to our status as an emerging growth company, see "RISK FACTORS RISKS RELATED
+TO OUR COMPANY – AS AN "EMERGING GROWTH COMPANY" UNDER THE JOBS ACT, WE ARE PERMITTED TO RELY ON
+EXEMPTIONS FROM CERTAIN DISCLOSURE REQUIREMENTS on page 15 of this prospectus.
+
+ 
+
+ 
+
+7 | Page
+
+ 
+
+We are also considered a "smaller reporting
+company" as defined in Rule 12b-2 under the Securities Exchange Act of 1934. As a smaller reporting company, we may take advantage
+of certain reduced reporting requirements, including simplified executive compensation disclosures and reduced financial statement requirements.
+Even if we cease to qualify as an emerging growth company, we may continue to be eligible for these reduced reporting obligations as long
+as we remain a smaller reporting company. For a discussion of the risks related to our status as a smaller reporting company, see "RISK
+FACTORS – RISKS RELATED TO OUR COMPANY – RISKS RELATED TO SMALLER REPORTING COMPANY STATUS" on page 16 of this prospectus.
+
+ 
+
+This is a direct participation offering since we are
+offering the stock directly to the public without the participation of an underwriter. Our President will be solely responsible for selling
+shares under this offering and no commission will be paid on any sales.
+
+ 
+
+There has been no market for our securities and a
+public market may never develop, or, if any market does develop, it may not be sustained. Our common stock is not traded on any exchange
+or on the over-the-counter market. After the effective date of the registration statement relating to this prospectus, we hope to have
+a market maker file an application with the Financial Industry Regulatory Authority ("FINRA") for our common stock to be eligible
+for trading on the OTC Markets Group or other quotation service. We do not yet have a market maker who has agreed to file such quotation
+service or that any market for our stock will develop.
+
+ 
+
+You should rely only on the information contained
+in this prospectus. We have not authorized anyone to provide you with information different from that contained in this prospectus. The information
+contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus
+or of any sale of our common shares.
+
+ 
+
+Under U.S. federal securities legislation, our common
+stock will be "penny stock." Penny stock is any equity security that has a market price of less than $5.00 per share,
+subject to certain exceptions. For any transaction involving a penny stock, unless exempt, the rules require that a broker or dealer approve
+a potential investor s account for transactions in penny stocks, and the broker or dealer receive from the investor a written agreement
+to the transaction, setting forth the identity and quantity of the penny stock to be purchased. In order to approve an investor s
+account for transactions in penny stocks, the broker or dealer must obtain financial information and investment experience objectives
+of the person, and make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has
+sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks. The broker
+or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prepared by the Commission relating to the
+penny stock market, which, in highlight form sets forth the basis on which the broker or dealer made the suitability determination. Brokers
+may be less willing to execute transactions in securities subject to the "penny stock" rules.
+
+ 
+
+8 | Page
+
+ 
+
+This may make it more difficult for investors to dispose
+of our common stock and cause a decline in the market value of our stock. Disclosure also has to be made about the risks of investing
+in penny stocks in both public offerings and in secondary trading and about the commissions payable to both the broker-dealer and the
+registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud
+in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held
+in the account and information on the limited market in penny stocks.
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diff --git a/parsed_sections/prospectus_summary/2025/CIK0002077241_ycs-group_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CIK0002077241_ycs-group_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/CIK0002079999_cardinal_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CIK0002079999_cardinal_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..66afefe269111acad0912162403f6e76cd7ed1cc
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+We are an emerging growth company as that term is used in the Jumpstart Our Business Startups Act of 2012, and as such, we have elected to take advantage of certain reduced public company reporting requirements for this prospectus and future filings. See Risk Factors and Summary Emerging Growth Company Status. We will have two classes of common stock after this offering: Class A Common Stock and Class B Common Stock. Upon completion of this offering and the Reorganization (as defined below), holders of shares of our Class A Common Stock and Class B Common Stock will be entitled to one vote for each share of Class A Common Stock or Class B Common Stock held of record on all matters on which stockholders are entitled to vote generally. See Description of Capital Stock. Upon consummation of this offering, certain persons (the Continuing Equity Holders ) will hold 100% of the shares of Class B Common Stock that will entitle them to 63.9% of the combined voting power of our common stock (or 61.0% if the underwriters exercise in full their option to purchase additional shares of Class A Common Stock). We will be a holding company, and upon consummation of this offering and the application of proceeds therefrom, our principal asset will consist of LLC Units (as defined below) we acquire directly from Cardinal Civil Contracting Holdings LLC, a Delaware limited liability company ( Cardinal ), and from each Continuing Equity Holder, collectively representing an aggregate 36.1% economic interest in Cardinal. The remaining 63.9% economic interest in Cardinal will be owned by the Continuing Equity Holders through their ownership of LLC Units, assuming no exercise of the underwriters option to purchase additional shares of Class A Common Stock. We will be the sole managing member of Cardinal. We will operate and control all of the business and affairs of Cardinal and, through Cardinal, conduct our business. Investing in our Class A Common Stock involves risks. See Risk Factors beginning on page 21 to read about factors you should consider before buying shares of our Class A Common Stock. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per share Total Public offering price $ $ Underwriting discounts and commissions(1) $ $ Proceeds to us (before expenses) $ $ ____________ (1) See Underwriting for a description of compensation payable to the underwriters. We have granted the underwriters a 30-day option to purchase up to an additional 1,725,000 shares of Class A Common Stock from us at the initial public offering price, less the underwriting discount. The underwriters expect to deliver the shares of Class A Common Stock to purchasers on or about , 2025. Book-Running Managers Stifel William Blair Lead Manager D.A. Davidson & Co. Table of Contents Table of Contents Table of Contents Page Summary 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and articles of association are to our amended and restated memorandum and articles of association to be in effect upon the completion of this offering; CCM are to Cohen & Company Capital Markets, a division of Cohen & Company Securities, LLC, as representative of the underwriters in this offering; Companies Act are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; completion window is the period following the completion of this offering at the end of which, if we have not completed our initial business combination, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (less taxes payable and up to $100,000 of interest to pay liquidation and dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions and as further described herein. The completion window ends 24 months from the closing of this offering. In addition, our shareholders can also vote at any time to amend our amended and restated memorandum and articles of association to modify the amount of time we will have to complete an initial business combination, in each case as further described herein; directors are to our directors (including our director nominees named in this prospectus); equity-linked securities are to any debt or equity securities that are convertible, exercisable or exchangeable for our Class A ordinary shares issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of such securities; founder shares are to our Class B ordinary shares and the Class A ordinary shares issued upon the automatic conversion thereof at the time of our initial business combination or at any time prior thereto at the option of the holder thereof, on a one-for-one basis (subject to adjustment as described in this prospectus), as provided herein; letter agreement refers to the letter agreement, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team are to our officers and directors; New BOA II refers to BOA Acquisition Corp. II after the initial business combination; ordinary resolution are to a resolution of the company passed by the affirmative vote of a simple majority of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at a general meeting of the company, or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter (or such lower threshold as may be allowed under the Companies Act from time to time); ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; private shares are to the Class A ordinary shares sold as part of the private placement units; private placement units are to the 400,000 units issued to our sponsor (whether or not the over-allotment option is exercised), of which 300,000 units would be purchased indirectly by the sponsor non-managing For each of the redemption scenarios above, the NTBV was calculated as follows: No Redemptions 25% 50% 75% 100% W/O Over- Allotment With Over- Allotment W/O Over- Allotment With Over- Allotment W/O Over- Allotment With Over- Allotment W/O Over- Allotment With Over- Allotment W/O Over- Allotment With Over- Allotment NTBV before offering $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) Increase attributable to public shareholders $ 7.10 $ 7.11 $ 6.53 $ 6.54 $ 5.64 $ 5.65 $ 4.02 $ 4.03 $ 0.17 $ 0.15 Pro forma NTBV after the offering $ 7.08 $ 7.09 $ 6.52 $ 6.53 $ 5.62 $ 5.63 $ 4.00 $ 4.01 $ 0.15 $ 0.13 Dilution to public shareholders $ 2.92 $ 2.91 $ 3.48 $ 3.47 $ 4.38 $ 4.37 $ 6.00 $ 5.99 $ 9.85 $ 9.87 % of dilution to public shareholders 29.2 % 29.1 % 34.8 % 34.7 % 43.8 % 43.7 % 60.0 % 59.9 % 98.5 % 98.7 % Numerator: Net tangible book deficit before this offering (139,659 ) (139,659 ) (139,659 ) (139,659 ) (139,659 ) (139,659 ) (139,659 ) (139,659 ) (139,659 ) (139,659 ) Net proceeds from this offering and sale of the private placement units 201,400,000 231,100,000 201,400,000 231,100,000 201,400,000 231,100,000 201,400,000 231,100,000 201,400,000 231,100,000 Plus: Offering costs excluded from tangible book value before this offering 144,350 144,350 144,350 144,350 144,350 144,350 144,350 144,350 144,350 144,350 Less: Deferred underwriting commissions (8,000,000 ) (9,200,000 ) (6,000,000 ) (6,900,000 ) (4,000,000 ) (4,600,000 ) (2,000,000 ) (2,300,000 ) Less: over-allotment liability (315,000 ) (315,000 ) (315,000 ) (315,000 ) (315,000 ) Less: amounts paid for redemptions (50,000,000 ) (57,500,000 ) (100,000,000 ) (115,000,000 ) (150,000,000 ) (172,500,000 ) (200,000,000 ) (230,000,000 ) 193,089,691 221,904,691 145,089,691 166,704,691 97,089,691 111,504,691 49,089,691 56,304,691 1,089,691 1,104,691 Denominator: Class B common shares outstanding prior to this offering 7,666,667 7,666,667 7,666,667 7,666,667 7,666,667 7,666,667 7,666,667 7,666,667 7,666,667 7,666,667 Class B common shares forfeited if over-allotment is not exercised (1,000,000 ) (1,000,000 ) (1,000,000 ) (1,000,000 ) (1,000,000 ) Class A common shares included in the units offered 20,600,000 23,630,000 20,600,000 23,630,000 20,600,000 23,630,000 20,600,000 23,630,000 20,600,000 23,630,000 Less: ordinary shares redeemed (5,000,000 ) (5,750,000 ) (10,000,000 ) (11,500,000 ) (15,000,000 ) (17,250,000 ) (20,000,000 ) (23,000,000 ) 27,266,667 31,296,667.00 22,266,667 25,546,667 17,266,667 19,796,667 12,266,667 14,046,667 7,266,667 8,296,667 NTBV after offering $ 7.08 $ 7.09 $ 6.52 $ 6.53 $ 5.62 $ 5.63 $ 4.00 $ 4.01 $ 0.15 $ 0.13 NTBV before offering $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) $ (0.02 ) (0.02 ) Difference $ 7.10 $ 7.11 $ 6.53 $ 6.54 $ 5.64 $ 5.65 $ 4.02 $ 4.03 $ 0.17 $ 0.15 (1) Expenses applied against gross proceeds include offering expenses of approximately $600,000 and underwriting discounts of $4,000,000 (or $4,600,000 if the underwriters over-allotment option is exercised in full). See Use of Proceeds . 5 members, and the 200,000 units (or 230,000 private placement units if the underwriters over-allotment option is exercised in full) issued to the underwriters, in private placements that will close simultaneously with the closing of this offering; private placement rights are to the rights sold as part of the private placement units; public rights are to the rights sold as part of the units in this offering (whether they are subscribed for in this offering or acquired in the open market); public shares are to our Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders are to the holders of our public shares, including our sponsor, officers and directors and the sponsor non-managing members to the extent our sponsor, officers, directors or sponsor non-managing members purchase public shares, provided that each of their status as a public shareholder shall only exist with respect to such public shares; rights are to our rights, which include the public rights as well as the private placement rights to the extent they are no longer held by the initial purchasers of the private placement units or their permitted transferees; SPACs are to special purpose acquisition companies; special resolution are to a resolution of the company passed by the affirmative vote of at least a two-thirds (2/3) majority (or such higher approval threshold as specified in the company s amended and restated memorandum and articles of association) of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at a general meeting of the company of which notice specifying the intention to propose the resolution as a special resolution has been duly given, or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter (or such lower threshold as may be allowed under the Companies Act from time to time); sponsor are to Bet on America II Sponsor LLC, a Cayman Islands limited liability company; Bet on America II HoldCo LLC is the managing member of our sponsor; Benjamin A. Friedman, our Chief Executive Officer and a member of our board of directors, controls Bet on America II Sponsor LLC; sponsor non-managing members means certain institutional investors (none of which are affiliated with any member of our management or any other investor) that have expressed an interest in purchasing non-managing membership interests in our sponsor reflecting interests in an aggregate of 300,000 of the 400,000 private placement units to be purchased by our sponsor, at a price of $10.00 per unit for each private placement unit ($3,000,000 in the aggregate), in private placements that will close simultaneously with the closing of this offering. Subject to the sponsor non-managing members purchasing, through the sponsor, the private placement units allocated to them simultaneously with the closing of this offering, the sponsor will issue membership interests at a nominal purchase price to the sponsor non-managing members reflecting their interest in an aggregate of 3,000,000 founder shares held by the sponsor; however, the sponsor non-managing members will have no right to vote the founder shares, private placement units or securities underlying the private placement units that they hold indirectly through their membership interests in the sponsor; underwriters option to purchase additional units are to the underwriters 45 -day option to purchase up to an additional 3,000,000 units to cover over-allotments, if any; and we, us, company or our company are to BOA Acquisition Corp. II, a Cayman Islands exempted company. Table of Contents 0002080216 2025-12-16 2025-12-16 0002080216 dei:BusinessContactMember 2025-12-16 2025-12-16 0002080216 spac:NoRedemptionMember 2025-12-16 2025-12-16 0002080216 spac:RedemptionAt100PercentOfMaximumMember 2025-12-16 2025-12-16 0002080216 spac:NoRedemptionMember boasu:NetProceedsFromThisOfferingAndSaleOfThePrivatePlacementUnitsMember 2025-12-16 2025-12-16 0002080216 spac:NoRedemptionMember boasu:OfferingCostsExcludedFromTangibleBookValueBeforeThisOfferingMember 2025-12-16 2025-12-16 0002080216 spac:NoRedemptionMember boasu:OverAllotmentLiabilityMember 2025-12-16 2025-12-16 0002080216 spac:ShareholderRedemptionsMember spac:NoRedemptionMember 2025-12-16 2025-12-16 0002080216 spac:NoRedemptionMember boasu:DeferredUnderwritingCommissionsMember 2025-12-16 2025-12-16 0002080216 spac:RedemptionAt100PercentOfMaximumMember boasu:NetProceedsFromThisOfferingAndSaleOfThePrivatePlacementUnitsMember 2025-12-16 2025-12-16 0002080216 spac:RedemptionAt100PercentOfMaximumMember 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boasu:ClassACommonSharesIncludedInTheUnitsOfferedMember 2025-12-16 2025-12-16 0002080216 spac:RedemptionAt100PercentOfMaximumMember boasu:OrdinarySharesRedeemedMember 2025-12-16 2025-12-16 0002080216 spac:OverAllotmentOptionExercisedMember spac:NoRedemptionMember 2025-12-16 2025-12-16 0002080216 spac:OverAllotmentOptionNotExercisedMember spac:NoRedemptionMember 2025-12-16 2025-12-16 0002080216 spac:OverAllotmentOptionNotExercisedMember spac:RedemptionAt75PercentOfMaximumMember 2025-12-16 2025-12-16 0002080216 spac:OverAllotmentOptionNotExercisedMember spac:RedemptionAt100PercentOfMaximumMember 2025-12-16 2025-12-16 0002080216 spac:OverAllotmentOptionExercisedMember spac:RedemptionAt25PercentOfMaximumMember 2025-12-16 2025-12-16 0002080216 spac:OverAllotmentOptionExercisedMember spac:RedemptionAt50PercentOfMaximumMember 2025-12-16 2025-12-16 0002080216 spac:OverAllotmentOptionExercisedMember spac:RedemptionAt75PercentOfMaximumMember 2025-12-16 2025-12-16 0002080216 spac:OverAllotmentOptionExercisedMember spac:RedemptionAt100PercentOfMaximumMember 2025-12-16 2025-12-16 0002080216 spac:OverAllotmentOptionNotExercisedMember spac:RedemptionAt25PercentOfMaximumMember 2025-12-16 2025-12-16 0002080216 spac:OverAllotmentOptionNotExercisedMember spac:RedemptionAt50PercentOfMaximumMember 2025-12-16 2025-12-16 0002080216 spac:FounderSharesMember 2025-12-16 2025-12-16 0002080216 boasu:PrivatePlacementUnitsMember 2025-12-16 2025-12-16 0002080216 boasu:AnyUnitsOrdinarySharesMember 2025-12-16 2025-12-16 0002080216 boasu:BetonAmericaIISponsorLLCMember 2025-12-16 2025-12-16 0002080216 boasu:WorkingCapitalLoansMember boasu:BetonAmericaIISponsorLLCMember 2025-12-16 2025-12-16 0002080216 boasu:ClassBOrdinarySharesMember boasu:BetonAmericaIISponsorLLCMember 2025-12-16 2025-12-16 0002080216 boasu:ClassBOrdinarySharesMember boasu:BrianDFriedmanMember 2025-12-16 2025-12-16 0002080216 boasu:ClassBOrdinarySharesMember boasu:DeanFriedmanMember 2025-12-16 2025-12-16 0002080216 boasu:ClassBOrdinarySharesMember boasu:JasonKahanMember 2025-12-16 2025-12-16 0002080216 boasu:ClassBOrdinarySharesMember boasu:JaredBerlinMember 2025-12-16 2025-12-16 0002080216 boasu:ClassBOrdinarySharesMember boasu:JonathanSassoverMember 2025-12-16 2025-12-16 0002080216 boasu:ClassBOrdinarySharesMember boasu:SethSchorrMember 2025-12-16 2025-12-16 0002080216 boasu:PrivatePlacementUnitsMember boasu:BetonAmericaIISponsorLLCMember 2025-12-16 2025-12-16 0002080216 spac:OverAllotmentOptionNotExercisedMember spac:NoRedemptionMember 2025-12-16 0002080216 spac:OverAllotmentOptionNotExercisedMember spac:RedemptionAt25PercentOfMaximumMember 2025-12-16 0002080216 spac:OverAllotmentOptionNotExercisedMember spac:RedemptionAt50PercentOfMaximumMember 2025-12-16 0002080216 spac:OverAllotmentOptionNotExercisedMember spac:RedemptionAt75PercentOfMaximumMember 2025-12-16 0002080216 spac:OverAllotmentOptionNotExercisedMember spac:RedemptionAt100PercentOfMaximumMember 2025-12-16 0002080216 spac:OverAllotmentOptionExercisedMember spac:NoRedemptionMember 2025-12-16 0002080216 spac:OverAllotmentOptionExercisedMember spac:RedemptionAt25PercentOfMaximumMember 2025-12-16 0002080216 spac:OverAllotmentOptionExercisedMember spac:RedemptionAt50PercentOfMaximumMember 2025-12-16 0002080216 spac:OverAllotmentOptionExercisedMember spac:RedemptionAt75PercentOfMaximumMember 2025-12-16 0002080216 spac:OverAllotmentOptionExercisedMember spac:RedemptionAt100PercentOfMaximumMember 2025-12-16 utr:Month iso4217:USD xbrli:shares iso4217:USD xbrli:shares The information contained in this preliminary prospectus is not complete and may be changed. No securities may be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities, and it is not soliciting an offer to buy these securities, in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED DECEMBER 16, 2025 PRELIMINARY PROSPECTUS $200,000,000 BOA Acquisition Corp. II 20,000,000 Units BOA Acquisition Corp. II is a newly incorporated blank check company incorporated for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share and one right to receive one-eighth (1/8) of one Class A ordinary share upon the consummation of an initial business combination. No fractional shares will be issued upon exchange of the rights, so you must hold rights in multiples of eight in order to receive shares for all of your rights upon closing of a business combination. We have also granted the underwriters a 45-day option to purchase up to an additional 3,000,000 units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem, regardless of whether they abstain, vote for, or vote against, our initial business combination, all or a portion of their Class A ordinary shares upon the completion of our initial business combination at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account described below calculated as of two business days prior to the consummation of our initial business combination, including interest, divided by the number of then outstanding public shares, subject to the limitations described herein. Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Securities Exchange Act of 1934, as amended (the Exchange Act )), is restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. We will have 24 months from the closing of this offering to consummate an initial business combination. In addition, our shareholders can also vote at any time to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to complete an initial business combination, in each case as further described herein. There is no limit on the number of times our shareholders can vote to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to complete an initial business combination, and any such extension may be for any amount of time. We refer to the time period we have to complete an initial business combination, as it may be extended as described above, as the completion window. If our completion window is extended by an amendment to our amended and restated memorandum and articles of association, holders of our public shares will be entitled to vote on such amendment and to redeem their shares in connection with any such extension, regardless of whether they abstain, vote in favor of or vote against such extension. If we have not completed our initial business combination within the completion window or we do not otherwise seek shareholder approval to amend our amended and restated memorandum and articles of association to further extend the time to complete our initial business combination, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (less taxes payable and up to $100,000 of interest to pay liquidation and dissolution expenses), divided by the number of then outstanding public shares, subject to applicable law and certain conditions as further described herein. Please see Redemption of Public Shares and Liquidation if no Initial Business Combination on page 145 for more information. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their option to purchase additional units and the forfeiture by our sponsor of 1,000,000 founder shares for no consideration. Any forfeiture of shares described in this prospectus will take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as share capitalizations as a matter of Cayman Islands law. Overview We are a blank check company newly incorporated as a Cayman Islands exempted company incorporated for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. We have not selected any business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. Our ability to complete our initial business combination may be impacted by the availability of financing, prevailing market conditions, and the regulatory environment, including recently adopted SEC rules applicable to special purpose acquisition companies. Members of our management team worked together as executive officers or members of the board of directors of BOA Acquisition Corp. ( BOA ), which completed its initial public offering in February 2021 and consummated its initial business combination in October 2022 with Selina Hospitality PLC ( Selina ), with BOA surviving the Business Combination as a wholly owned subsidiary of Selina, with the securityholders of BOA becoming securityholders of Selina, approximately 20 months after its initial public offering. In connection with the consummation of the Business Combination, on October 27, 2022, BOA notified the New York Stock Exchange ( NYSE ) of the consummation of the Business Combination and (i) requested that NYSE suspend trading of the BOA Class A common stock, BOA warrants and BOA units (each as described on the cover page of this Current Report on Form 8-K; collectively, the BOA Securities ), effective September 28, 2022 and (ii) filed with the SEC a Form 25 to delist the BOA Securities under Section 12(b) of the Securities Exchange Act of 1934, as amended (the Exchange Act ). BOA subsequently filed a certification on Form 15 with the SEC to deregister the BOA Securities and suspended BOA s reporting obligations under Sections 13 and 15(d) of the Exchange Act. As the second SPAC led by members of our management and board team, we believe our experiences offer a competitive advantage for us. As discussed further below, we seek to leverage and capitalize on our collective multi-faceted expertise, investing and operating experience, and broad network of relationships to source and evaluate potential transactions and create value for our stakeholders. We believe we have a deep and broad network of relationships and sector expertise to source and evaluate potential transactions, enhancing our ability to position us as a partner of choice with potential target companies. We believe that the extensive investing track record and operational experience of the management team, including significant public company executive and board experience, are expected to enhance our credibility with prospective investors, and will allow us to be a value-added partner to the management team and stakeholders of a target business following an initial business combination. We believe our extensive M&A and capital markets experience, including SPAC experience, will enable us to successfully execute an initial business combination transaction. While we may pursue an acquisition opportunity at any stage of development and in any industry or geography, we intend to focus our search on opportunities involving direct investments in real estate and infrastructure assets, particularly within the energy, telecommunications, and transportation sectors, where we believe our management team has a competitive advantage due to their prior experience and expertise. We refer Prior to this offering, there has been no public market for our units, Class A ordinary shares or rights. We intend to apply to list our units on the Nasdaq Global Market ( Nasdaq ) under the symbol THEOU on or promptly after the date of this prospectus. The Class A ordinary shares and rights constituting the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day), subject to certain conditions. Once the securities constituting the units begin separate trading, we expect that the Class A ordinary shares and rights will be listed on Nasdaq under the symbols THEO , and THEOR, respectively. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves risks. Please see Risk Factors on page 55 . Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Per Unit Total Price to Public $ 10.00 $ 200,000,000 Underwriting Discounts and Commissions(1) $ 0.60 $ 12,000,000 Proceeds, before expenses, to us $ 9.40 $ 188,000,000 (1) Including (a) $0.20 per unit sold in the offering, or $4,000,000 in the aggregate, payable upon the closing of this offering (or up to $4,600,000 if the underwriters over-allotment option is exercised in full), of which (i) $0.10 per unit will be paid to the underwriters in cash, and (ii) $0.10 per unit will be used by the underwriters to purchase private placement units and (b) up to $0.40 per unit sold in the offering, or up to $8,000,000 in the aggregate (or up to $9,200,000 if the underwriters overallotment option is exercised in full) payable to the underwriters in this offering based on the percentage of funds remaining in the trust account after redemptions of public shares, for deferred underwriting commissions to be placed in a trust account located in the United States and released to the underwriters only upon the completion of an initial business combination. See Underwriting for a description of compensation and other items of value payable to the underwriter. Of the proceeds we receive from this offering and the sale of the private placement units described in this prospectus, $200,000,000, or $230,000,000 if the underwriters option to purchase additional units is exercised in full ($10.00 per unit in either case), will be deposited into a U.S.-based trust account with Odyssey Trust Company acting as trustee. The funds held in the trust account will not be released from the trust account until the earliest of: (1) the completion of our initial business combination; (2) the redemption of any public shares properly submitted in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (i) to modify the substance or timing of our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if we have not consummated our initial business combination within the completion window or (ii) with respect to any other provision relating to shareholders rights or pre-initial business combination activity; and (3) the redemption of all of our public shares if we are unable to complete our initial business combination within the completion window, subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. Our sponsor, Bet on America II Sponsor LLC, currently holds an aggregate of 7,666,667 founder shares (up to 1,000,000 of which are subject to forfeiture by the holders thereof depending on the extent to which the underwriters over-allotment option is exercised) for an aggregate purchase price of $25,000, or approximately $0.003 per share. The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of our initial business combination, or at any time prior thereto at the option of the holder thereof, on a one-for-one basis, subject to adjustment as provided herein. In the case that additional Class A ordinary shares, or equity-linked securities (as described herein), are issued or deemed issued in excess of the amounts issued in this offering and related to the closing of our initial business combination, the ratio at which the Class B ordinary shares will convert into Class A ordinary shares will be adjusted (unless the holders of a majority of the issued and outstanding Class B ordinary shares agree to waive such anti-dilution adjustment with respect to any such to these opportunities collectively as Real Estate and Infrastructure. On the real estate side, our strategy is to acquire or invest in high-quality, income-generating assets and operating businesses across these sectors. This includes a broad range of commercial and residential real estate, such as office buildings, multi-family housing, retail centers, industrial warehouses, hospitality properties, self-storage facilities, medical and senior housing, and logistics and cold storage assets. On the infrastructure side, we are targeting essential assets and businesses involved in or supporting the development, ownership, and operation of oil and gas fields, pipelines, storage terminals, energy grids, power generation and transmission assets, telecommunications networks, and transportation systems such as ports, toll roads, and intermodal logistics hubs. We intend to leverage our sponsor s and directors deep sector-specific knowledge and networks to identify and evaluate proprietary opportunities that align with our long-term investment strategy. Our Sponsor Our sponsor is a Cayman Islands limited liability company, which was formed to invest in us. Although our sponsor is permitted to undertake any activities permitted under its limited liability company agreement and the Limited Liabilities Companies Act, as revised, and other applicable law, our sponsor s business is focused on investing in our company. The manager of the sponsor is Bet on America II HoldCo LLC, a Cayman Islands limited liability company, that Benjamin A. Friedman, our Chief Executive Officer, Chief Financial Officer and a member of our board of directors, controls. In this capacity, Mr. Friedman controls the management of our sponsor, including the exercise of voting and investment discretion over the securities of our company held by our sponsor. The sponsor non-managing members have expressed an interest to purchase non-managing membership interests in our sponsor, reflecting interests in an aggregate of 30 0,000 of the 400,000 private placement units to be purchased by our sponsor at a price of $10.00 per private placement unit ($3,0 00,000 in the aggregate), in private placements that will close simultaneously with the closing of this offering. Subject to the sponsor non-managing members purchasing, through the sponsor, the private placement units allocated to them simultaneously with the closing of this offering, the sponsor will issue membership interests at a nominal purchase price to the sponsor non-managing members reflecting their interest in an aggregate of 3 ,0 00,000 founder shares held by the sponsor. The sponsor non-managing members will have no right to vote the founder shares, private placement units or securities underlying the private placement units that they hold indirectly through their membership interests in the sponsor. See Summary The Offering Private placement units . Other than our management team, none of the other members of our sponsor will participate in our company s activities. Because (i) none of the sponsor non-managing members or our independent directors will hold voting interests in our sponsor nor have any rights to control our sponsor or to vote or dispose of any securities held by our sponsor, (ii) each of the sponsor non-managing members is an institutional investor that is able to bear the complete risk of loss of the proposed investment in our sponsor, and (iii) no individual sponsor non-managing member or independent director would indirectly own a significant percentage of any of the securities held by our sponsor, none of the sponsor non-managing members or independent directors will have a direct or indirect material economic interest in our sponsor. Certain of our officers and directors hold approximately 52 % of the outstanding Class A membership interests and approximately 13% of the outstanding Class B membership in our Sponsor. The remaining membership interests in the Sponsor are held by certain sponsor non-managing members, each of which owns less than 20% of the Class A outstanding membership interests or Class B outstanding membership interests in our Sponsor. issuance or deemed issuance) so that the number of Class A ordinary shares issuable upon conversion of all Class B ordinary shares will equal, in the aggregate, 25% of the sum of all Class A ordinary shares issued and outstanding upon the completion of this offering, plus all Class A ordinary shares and equity-linked securities issued or deemed issued in connection with our initial business combination, excluding any Class A ordinary shares, subject to vesting and any other restrictions, issued or deemed issued to (i) our sponsor (or its members or affiliates) in connection with the consummation of this offering, (ii) any seller in the initial business combination, (iii) any Class A ordinary shares issued to our sponsor (or its members or affiliates) upon conversion of working capital loans. If we increase or decrease the size of this offering we will effect a capitalization or share repurchase or redemption or other appropriate mechanism, as applicable, with respect to our Class B ordinary shares immediately prior to the consummation of the offering in such amount as to maintain the ownership of our sponsor at 25% of the issued and outstanding ordinary shares upon the consummation of this offering. Our public shareholders may incur material dilution due to such anti-dilution adjustments that result in the issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion or additional Class B ordinary shares. Prior to the closing of our initial business combination, only holders of our Class B ordinary shares (i) will have the right to vote to appoint and remove directors prior to or in connection with the completion of our initial business combination and (ii) will be entitled to vote on continuing our company in a jurisdiction outside the Cayman Islands (including any special resolution required to adopt new constitutional documents as a result of our approving a transfer by way of continuation in a jurisdiction outside the Cayman Islands). On any other matters submitted to a vote of our shareholders prior to or in connection with the completion of our initial business combination, holders of the Class B ordinary shares and holders of the Class A ordinary shares will vote together as a single class, except as required by law. See Summary Our Sponsor on page 4, Summary The Offering Founder shares on page 24, Summary The Offering Transfer restrictions on founder shares on page 27, Summary The Offering Founder shares conversion and anti-dilution rights on page 28, Summary The Offering Appointment and removal of directors and continuing the company outside of the Cayman Islands; voting rights on page 28, Risk Factors Risks Relating to our Sponsor and Management Team The nominal purchase price paid by our sponsor for the founder shares, the purchase price paid by our sponsor for the private placement units may significantly dilute the implied value of your public shares in the event we consummate an initial business combination, and our sponsor is likely to make a substantial profit on its investment in us in the event we consummate an initial business combination, even if the business combination causes the trading price of our ordinary shares to decline materially on page 78, Risks Relating to our Securities We may issue additional ordinary shares or preference shares to complete our initial business combination or under an employee incentive plan after completion of our initial business combination. We may also issue Class A ordinary shares upon the conversion of the Class B ordinary shares at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions contained in our amended and restated memorandum and articles of association. Any such issuances would dilute the interest of our shareholders and likely present other risks on page 89, Our sponsor paid an aggregate of $25,000, or approximately $0.003 per founder share, and, accordingly, you will experience immediate and substantial dilution from the purchase of our Class B ordinary shares on page 90 and Unlike many other similarly structured blank check companies, our sponsor will receive additional Class A ordinary shares if we issue shares to consummate an initial business combination on page 90 and Proposed Business Our Sponsor on page 120 for more information. Our sponsor has committed to purchase an aggregate of 400,000 private placement units of our company for an aggregate purchase price of $4,000,000 (whether or not the underwriters over-allotment option is exercised in full) in separate private placements (referred to herein as the Private Placement ). The private placement units will be identical to the units sold in this offering except that, so long as they are held by our sponsor or its permitted transferees, the private placement units (including their component securities as well as any securities underlying those component securities) (i) are locked-up until thirty (30) days following the completion of our initial business combination, (ii) will be entitled to registration rights and (iii) the Class A ordinary shares included as a component of the private placement units will not be entitled to redemption rights. Institutional investors (none of which are affiliated with any member of our management, our sponsor, the representatives of the underwriters (as identified below) or any other investor), which we refer to as the sponsor non-managing members throughout this prospectus, have expressed to us an interest in purchasing, indirectly through the purchase of non-managing sponsor membership interests, an aggregate of 300,000 private placement units (whether or not the over-allotment option is exercised) at a price of $10.00 per unit for an aggregate purchase The following table sets forth the payments to be received by our sponsor and its affiliates from us prior to or in connection with the completion of our initial business combination and the securities issued and to be issued by us to our sponsor or its affiliates: Entity / Individual Amount of Compensation to be Received or Securities Issued or to be Issued Consideration Paid or to be Paid Bet on America II Sponsor LLC $20,000 per month, commencing on the first date on which our securities are listed on Nasdaq Office space, administrative and shared personnel support services 7,666,667(1)(3) Class B Ordinary Shares $25,000 400,000 private placement units (whether or not the over-allotment option is exercised) $4,000,000 (whether or not the over-allotment option is exercised) Up to $300,000 Repayment of loans made to us to cover offering related and organizational expenses Reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination Expenses incurred in connection with identifying, investigating and completing an initial business combination Up to $2,500,000 in working capital loans, which loans may be convertible into private placement units of the post-business combination entity at the price of $10.00 per unit(2) Working capital loans to finance transaction costs in connection with an initial business combination Brian D. Friedman 30,000 Class B Ordinary Shares(4) Service as Chairman of the Board Dean Friedman 30,000 Class B Ordinary Shares(4) Service as director Jason Kahan 30,000 Class B Ordinary Shares(4) Service as independent director Jared Berlin 30,000 Class B Ordinary Shares(4) Service as independent director Jonathan Sassover 30,000 Class B Ordinary Shares(4) Service as independent director Seth Schorr 30,000 Class B Ordinary Shares(4) Service as independent director (1) The Class B ordinary shares and the Class A ordinary shares issuable in connection with the conversion of the Class B ordinary shares may result in material dilution to our public shareholders due to the nominal price of $0.003 per share at which our sponsor purchased the Class B ordinary shares and/or the anti-dilution rights of our Class B ordinary shares that may result in an issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion. Our sponsor, directors and officers and their affiliates may receive additional compensation and/or may be issued additional securities in connection with an initial business combination, including securities that may result in material dilution to public shareholders. See Risk Factors Risks Relating to our Sponsor and Management Team The nominal purchase price paid by our sponsor for the founder shares and the purchase price paid by our sponsor for the private placement units may significantly dilute the implied value of your public shares in the event we consummate an initial business combination, and our sponsor is likely to make a substantial profit on its investment in us in the event we consummate an initial business combination, even if the business combination causes the trading price of our ordinary shares to decline materially on page 78, Risks Relating to our Securities We may issue additional ordinary shares or preference shares to complete our initial business combination or under an employee incentive plan after completion of our initial business combination. We may also issue price of $3,000,000 in a private placement that will close simultaneously with the closing of this offering. Subject to the sponsor non-managing members purchasing, through the sponsor, the private placement units allocated to them simultaneously with the closing of this offering, the sponsor will issue membership interests at a nominal purchase price to the sponsor non-managing members reflecting their interest in an aggregate of 3,000,000 founder shares (as defined below) held by the sponsor. The sponsor non-managing members will have no right to vote the founder shares, private placement units or securities underlying the private placement units that they hold indirectly through their membership interests in the sponsor. The underwriters have committed to use a portion of their underwriting discount and commission to purchase an aggregate of 200,000 private placement units (or 230,000 private placement units in the aggregate if the underwriters over- allotment option is exercised in full) at a price of $10.00 per unit, or $2,000,000 in the aggregate (or $2,300,000 in the aggregate if the underwriters overallotment option is exercised in full), in a private placement that will close simultaneously with the closing of this offering. The private placement units are identical to the units sold in this offering, subject to certain limited exceptions as described in this prospectus. The private placement units shall be subject to the transfer restrictions as described under Principal Shareholders Restrictions on Transfers of Founder Shares and Private Placement Units . The interests of the members of the sponsor are denominated in two classes of membership interest units: (i) Class A membership units representing interests in the founder shares on a one-for-one basis and (ii) Class B membership units that will represent an interest in the private placement units on a one-for-one basis. The Class A membership units are further subdivided into two series: (i) Class A-1 membership units representing interests in the founder shares that will be subject to forfeiture in the event that the over-allotment option is not exercised in full and (ii) Class A-2 membership units representing interests in the founder shares that will not be subject to forfeiture whether or not the over-allotment option is exercised in full. Any sponsor non-managing member that may join the sponsor concurrently with this offering will hold membership units representing their proportional interest in the founder shares and private placement units. Upon the closing of this offering, the Class A membership units will collectively represent an interest in 7,666,667 founder shares and the Class B membership units will collectively represent an interest in 400,000 private placement units held by our sponsor. Upon the closing of this offering, (i) the sponsor non-managing members will hold Class A-2 membership units collectively representing an interest in 3,000,000 founder shares and Class B membership units collectively representing an interest in 300,000 private placement units and (ii) our sponsor will hold Class A-1 membership units representing an interest in 4,666,667 founder shares and Class B membership units representing an interest in 100,000 private placement units. Commencing on the date on which our securities are listed on Nasdaq, we will pay an affiliate of our sponsor $20,000 per month for office space, administrative and shared personnel support services. See Summary Our Sponsor on page 4 for more information. In the event that following this offering we obtain working capital loans from our sponsor to finance transaction costs related to our initial business combination, up to $2,500,000 of such loans may be convertible into private placement units of the post-business combination entity at a price of $10.00 per unit at the option of our sponsor. In addition, after the completion of this offering, our board of directors may approve additional working capital loans from our sponsor or third parties for the purpose of funding working capital, which loans may be converted into our private placement units shares or rights. Because our sponsor acquired the founder shares at a nominal price, our public shareholders will incur immediate and substantial dilution upon the closing of this offering. Additionally, the Class A ordinary shares issuable in connection with the conversion of the founder shares may result in material dilution to our public shareholders due to the anti-dilution rights of our founder shares that may result in an issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion. Further, the Class A ordinary shares underlying the private placement units and private placement rights, as well as any Class A ordinary shares issued in connection with conversion of working capital loans (as described in this prospectus), may result in material dilution to our public shareholders. See Risk Factors Risks Relating to our Sponsor and Management Team The nominal purchase price paid by our sponsor for the founder shares and the purchase price paid by our sponsor for the private placement units may significantly dilute the implied value of your public shares in the event we consummate an initial business combination, and our sponsor is likely to make a substantial profit on its investment in us in the event we consummate an initial business combination, even if the business combination causes the trading price of our ordinary shares to decline Class A ordinary shares upon the conversion of the Class B ordinary shares at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions contained in our amended and restated memorandum and articles of association. Any such issuances would dilute the interest of our shareholders and likely present other risks on page 89, Our sponsor paid an aggregate of $25,000, or approximately $0.003 per founder share, and, accordingly, you will experience immediate and substantial dilution from the purchase of our Class B ordinary shares on page 90 and Unlike many other similarly structured blank check companies, our sponsor will receive additional Class A ordinary shares if we issue shares to consummate an initial business combination on page 90. (2) After the completion of this offering, our board of directors may approve additional working capital loans for the purpose of funding working capital, which loans may be converted into our private placement units, shares or rights. The Class A ordinary shares issuable in connection with the vesting of the private placement rights, as well as any Class A ordinary shares issued in connection with conversion of working capital loans into additional private placement units (as described in this prospectus), may result in material dilution to our public shareholders. See Description of Securities Private placement units on page 189; see also Risk Factors Risks Relating to our Sponsor and Management Team The nominal purchase price paid by our sponsor for the founder shares, the purchase price paid by our sponsor for the private placement units may significantly dilute the implied value of your public shares in the event we consummate an initial business combination, and our sponsor is likely to make a substantial profit on its investment in us in the event we consummate an initial business combination, even if the business combination causes the trading price of our ordinary shares to decline materially on page 78, Risks Relating to our Securities We may issue additional ordinary shares or preference shares to complete our initial business combination or under an employee incentive plan after completion of our initial business combination. We may also issue Class A ordinary shares upon the conversion of the Class B ordinary shares at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions contained in our amended and restated memorandum and articles of association. Any such issuances would dilute the interest of our shareholders and likely present other risks on page 89, Our sponsor paid an aggregate of $25,000, or approximately $0.003 per founder share, and, accordingly, you will experience immediate and substantial dilution from the purchase of our Class B ordinary shares on page 90 and Unlike many other similarly structured blank check companies, our sponsor will receive additional Class A ordinary shares if we issue shares to consummate an initial business combination on page 90. (3) If we increase or decrease the size of this offering we will effect a capitalization or share repurchase or redemption or other appropriate mechanism, as applicable, with respect to our Class B ordinary shares immediately prior to the consummation of the offering in such amount as to maintain the ownership of our sponsor at 25% of the issued and outstanding ordinary shares upon the consummation of this offering. Our public shareholders may incur material dilution due to such anti-dilution adjustments that result in the issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion or additional Class B ordinary shares. (4) These shares are held directly by certain of our officers and directors. The directors and officers will have the ability to vote and dispose of the shares, subject to applicable transfer restrictions. Because our sponsor acquired the founder shares at a nominal price, our public shareholders will incur immediate and substantial dilution upon the closing of this offering. See the section titled Risk Factors Risks Relating to our Sponsor and Management Team The nominal purchase price paid by our sponsor for the founder shares and the purchase price paid by our sponsor for the private placement units may result in significant dilution to the implied value of your public shares upon the consummation of our initial business combination . The founder shares will automatically convert into Class A ordinary shares at the time of our initial business combination, or at any time prior thereto at the option of the holder thereof, on a one-for-one basis, subject to materially on page 78 , Risks Relating to our Securities We may issue additional ordinary shares or preference shares to complete our initial business combination or under an employee incentive plan after completion of our initial business combination. We may also issue Class A ordinary shares upon the conversion of the Class B ordinary shares at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions contained in our amended and restated memorandum and articles of association. Any such issuances would dilute the interest of our shareholders and likely present other risks on page 89 , Our sponsor paid an aggregate of $25,000, or approximately $0.003 per founder share, and, accordingly, you will experience immediate and substantial dilution from the purchase of our Class B ordinary shares on page 90 and Unlike many other similarly structured blank check companies, our sponsor will receive additional Class A ordinary shares if we issue shares to consummate an initial business combination on page 90 ; See also Description of Securities Private placement units on page 182 . The following table illustrates the difference between the public offering price and our net tangible book value (NTBV), as adjusted to give effect to this offering and to redemptions of our public shares at varying levels, assuming the full exercise and no exercise of the over-allotment option. See Summary Dilution on page 50 and Dilution on page 107 for more information. Offering Price of $10.00 per Unit 25% of Max Redemption 50% of Max Redemption 75% of Max Redemption Max Redemption NTBV Difference NTBV Difference NTBV Difference NTBV Difference NTBV Difference Assuming Full Exercise of Over-Allotment Option $7.09 $2.91 $6.53 $3.47 $5.63 $4.37 $4.01 $5.99 $0.13 $9.87 Assuming No Exercise of Over-Allotment Option $7.08 $2.92 $6.52 $3.48 $5.62 $4.38 $4.00 $6.00 $0.15 $9.85 Our sponsor, members of our management team and our independent directors (as consideration for each such director s service as a director, as further discussed in this prospectus), will directly or indirectly own our securities following this offering, and accordingly, they may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Additionally, each of our officers and directors currently serve as directors, officers, or advisors of other companies and, in such capacities have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. As a result, there may be potential material conflicts of interest between our sponsor and members of our management team on one hand, and purchasers in this offering on the other. See Summary The Offering Conflicts of interest on page 45, Proposed Business Our Sponsor on page 120, Proposed Business Sourcing of Potential Business Combination Targets on page 134 and Management Conflicts of Interest on page 168. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2025. Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. No offer or invitation, whether directly or indirectly, is being or may be made to the public in the Cayman Islands to subscribe for any of our securities. Sole Book-Running Manager Cohen & Company Capital Markets The date of this prospectus is , 2025. adjustment as provided herein. In the case that additional Class A ordinary shares, or equity-linked securities, are issued or deemed issued in excess of the amounts sold in this offering and related to the closing of our initial business combination, the ratio at which Class B ordinary shares shall convert into Class A ordinary shares will be adjusted (unless the holders of a majority of the outstanding Class B ordinary shares agree to waive such anti-dilution adjustment with respect to any such issuance or deemed issuance) so that the number of Class A ordinary shares issuable upon conversion of all Class B ordinary shares will equal, in the aggregate, on an as-converted basis, 25% of the total number of all ordinary shares outstanding upon completion of this offering plus all Class A ordinary shares and equity-linked securities issued or deemed issued in connection with our initial business combination, excluding any Class A ordinary shares, subject to vesting and any other restrictions, issued or deemed issued to (i) our sponsor (or its members or affiliates) in connection with the consummation of this offering, (ii) any seller in the initial business combination, and (iii) any Class A ordinary shares issued to our sponsor (or its members or affiliates) upon conversion of working capital loans. If we increase or decrease the size of this offering we will effect a capitalization or share repurchase or redemption or other appropriate mechanism, as applicable, with respect to our Class B ordinary shares immediately prior to the consummation of the offering in such amount as to maintain the ownership of our sponsor at 25% of the issued and outstanding ordinary shares upon the consummation of this offering. Our public shareholders may incur material dilution due to such anti-dilution adjustments that result in the issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion or additional Class B ordinary shares. In addition, in order to facilitate our initial business combination, our sponsor may surrender or forfeit, transfer or exchange our founder shares, private placement units (or component securities) or any of our other securities, including for no consideration, as well as subject any such securities to earn-outs or other restrictions, or otherwise amend the terms of any such securities or enter into any other arrangements with respect to any such securities. While there is no current intention to do so, and the members of our management team and sponsor have not done so with any previously formed special purpose acquisition companies, we may approve an amendment or waiver of the letter agreement that would allow the sponsor to directly, or members of our sponsor to indirectly, transfer founder shares and private placement units (including component securities as well as any securities underlying those component securities) or membership interests in our sponsor in a transaction in which the sponsor removes itself as our sponsor before identifying a business combination. As a result, there is a risk that our sponsor and our officers and directors may divest their ownership or economic interests in us or in our sponsor. There can be no assurance that any replacement sponsor or key personnel will successfully identify a business combination target for us, or, even if one is so identified, successfully complete such business combination. If we raise additional funds through equity or convertible debt issuances, our public shareholders may suffer significant dilution. This dilution would increase to the extent that the anti-dilution provision of the founder shares result in the issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion of the founder shares at the time of our initial business combination or additional Class B ordinary shares. Pursuant to a letter agreement to be entered with us, our sponsor and each of our directors and officers has agreed to restrictions on their ability to transfer, assign, or sell the founder shares and private placement units (including component securities as well as any securities underlying those component securities) as summarized in the table below. Subject Securities Expiration Date Persons Subject to Restrictions Exceptions to Transfer Restrictions Founder Shares Earlier of one year after completion of our initial business combination; or if the closing price of our Class A ordinary shares equals or exceeds $12.00 per Class A ordinary share (as adjusted for share sub-divisions, share dividends, reorganizations, recapitalizations and other similar transactions) for any 20 trading days within any 30-trading day period commencing any time 150 days after completion of our initial business combination Bet on America II Sponsor II, Benjamin A. Friedman, Brian D. Friedman, Dean Friedman, Jason Kahan, Jared Berlin, Jonathan Sassover and Seth Schorr Transfers permitted (i) to any officer, director, or employee of the Company, including to a family member or affiliate of such officer, director, or employee; (ii) by private sales or transfers, in each case, made in connection with the consummation of our initial business combination at prices no greater than the price at which the securities were originally purchased; (iii) in the event of our liquidation prior to the completion of our initial business combination; (iv) by virtue of the laws of the Cayman Islands or our sponsor s limited liability company agreement upon liquidation and dissolution of our sponsor; and (v) in the event of our completion of a liquidation, merger, share exchange, reorganization or other similar transaction which results in all of our public shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property subsequent to the completion of our initial business combination Subject Securities Expiration Date Persons Subject to Restrictions Exceptions to Transfer Restrictions Private Placement Units 30 days after the completion of our initial business combination Bet on America II Sponsor LLC Same as above Any units, ordinary shares or any other securities convertible into, or exercisable or exchangeable for, any units, ordinary shares or founder shares 180 days after the date of this prospectus Same as above The representative in its sole discretion may release any of the securities subject to these lock-up agreements at any time without notice, other than in the case of the officers and directors, which shall be with notice. Our sponsor, officers and directors are also subject to separate transfer restrictions on their founder shares and private placement units pursuant to the letter agreement described in the immediately preceding paragraphs. In addition, pursuant to such letter agreement, for the benefit of CCM, we, our sponsor and our officers and directors have agreed that we will not offer, sell, contract to sell, pledge, charge or grant any option to purchase or otherwise dispose of, directly or indirectly, without the prior written consent of CCM for a period of 180 days after the date of this prospectus, any units, rights, ordinary shares or any other securities convertible into, or exercisable, or exchangeable for, ordinary shares or enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any units, ordinary shares, or any securities convertible into, or exercisable, or exchangeable for, ordinary shares owned, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise; provided, however, that we may (1) issue and sell the private placement units; (2) issue and sell the additional units to cover our underwriters over-allotment option (if any); (3) register with the SEC pursuant to an agreement to be entered into concurrently with the issuance and sale of the securities in this offering, the resale of the Class A ordinary shares issuable upon exercise of the rights and upon conversion of the founder shares; and (4) issue securities in connection with our initial business combination. However, the foregoing restriction shall not apply to the forfeiture of any founder shares pursuant to their terms. CCM in its sole discretion may release any of the securities subject to these lock-up agreements at any time without notice. The founder shares and the private placement units, as applicable, held by the sponsor will only be distributed to the members of the sponsor (including the sponsor non-managing members) after consummation of our initial business combination, at which time such sponsor non-managing members would become subject to the applicable transfer restrictions with respect to such securities. Pursuant to FINRA Rule 5110(e), the private placement units purchased by CCM and/or its permitted designees may not be sold, transferred, assigned, pledged or hypothecated or the subject of any hedging, short sale, derivative, put or call transaction that would result in the economic disposition of the securities by any person for a period of 180 days immediately following the commencement of sales of this offering except to any member participating in the offering and the officers or part ners, registered persons or affiliates thereof except as permitted by FINRA Ru le 5110(e)(2). Our Management Team Our management team will deploy an active and thematically-based sourcing strategy to leverage our sector expertise and proprietary deal flow. We believe that the combined experiences of our management team and director and their track record, network, and operating experience will enable us to identify, evaluate, and execute an initial business combination that creates long-term shareholder value. Our management team is led by Brian D. Friedman, Chairman, and Benjamin A. Friedman, Chief Executive Officer and Chief Financial Officer. Benjamin A. Friedman , our Chief Executive Officer and Chief Financial Officer, currently serves as the Managing Partner of The Avery Companies, a private investment holding company focused on control and minority investments across Digital and Energy Infrastructure, Essential Services, Real Assets and Real Estate, since 2023. Mr. Friedman co-founded and serves on the board of directors for PhireLink, a leading rural fiber broadband internet services provider. Additionally, Mr. Friedman has also served a Partner at Friedman Capital, heading the corporate investing practice, since 2020. From December 2020 to October 2022, he served as President and Chief Financial Officer of BOA Acquisition Corp (NYSE: BOAS), a $230 million real estate and Infrastructure focused SPAC. Mr. Friedman was a Portfolio Manager at CQS, UK LLP, an $18 billion opportunistic credit hedge fund where he ran US credit investment strategies and a Senior Trader at Citigroup Global Markets focused on oil and gas infrastructure. He began his career at Bank of America Merrill Lynch in leveraged finance. He was named to Forbes Top 30 under 30 in 2017. Mr. Friedman received his undergraduate degree from the University of Pennsylvania, graduating Magna Cum Laude. We believe Mr. Friedman is well qualified to serve as Chief Executive Officer and Chief Financial Officer due to his extensive experience in public and private financial markets, including specializing in infrastructure investments across sectors and products. Brian D. Friedman , our Chairman, has extensive experience in the real estate and investment industry. From December 2020 and October 2022, he served as Chairman and Chief Executive Officer of BOA Acquisition Corp (NYSE: BOAS), a $230 million Real Estate and Infrastructure focused SPAC, which successfully completed a business combination in 2022. Additionally, since October 2010, he has served as a Partner at Friedman Capital, a family office, leading the real estate and special situations investing practice. Mr. Friedman is also a co-founder and Managing Partner of Foxhall Partners, a commercial real estate firm, and has served in this capacity since April 2010. Since 2016, Mr. Friedman has served on the board of KeySourceUSA, a generic drug distributor. He is a member of Urban Land Institute ( ULI ) and International Council of Shopping Centers ( ICSC ) and a strategic advisor to Amalgamated Casualty Insurance, supporting their real estate portfolio. Mr. Friedman is actively involved in the community, having co-founded the non-profit Adams Morgan Youth Leadership Academy and previously served as a board member of Washington Hebrew. He received his undergraduate degree and MBA from the Kogod School at American University. We believe Mr. Friedman s extensive experience in the real estate and investment industry, along with his leadership in both public and private companies, makes him well qualified to serve as our Chairman. Dean Friedman, who will serve as a director upon completion of this offering, is an accomplished investor and brings over 40 years of executive management experience in public and private markets. He is currently the Managing Partner of Friedman Family Partners, a private family-owned investment holding company, where he oversees a diverse portfolio of public and private investments across the media, healthcare, and real estate sectors and has served in this capacity since January 2005. Mr. Friedman formerly served as the Chairman and CEO of Real Integrated, a leading advertising agency prior to its sale in 2023. Prior to acquiring Real Integrated in 1992, Mr. Friedman was a Board Member and major shareholder of W.B. Doner & Co., at the time the world s largest independent advertising agency, where he led their international business portfolio. Mr. Friedman has served on the boards of public and private companies in the Consumer, Media, and Financial industries. He is a founder of Franklin Bank and served as a Director through the Company s IPO and ultimate sale to a larger bank. Mr. Friedman was also an early investor in The Harvard Drug Group and steered the company through two private equity exits and eventual sale to Cardinal Health. Mr. Friedman received his B.A. from the University of Michigan. We believe Mr. Friedman s extensive experience investing in and overseeing real estate businesses, together with his record of leadership in public and private companies, makes him well qualified to serve on the board of our company. Jason Kahan , who will serve as a director upon completion of this offering, is a seasoned investor and executive with over two decades of experience investing in the infrastructure and real assets space. He is the Co-Founder and Partner of Lightfield Partners, a specialty finance company focused on renewable energy and digital infrastructure, and has served in this capacity since October 2023. At Lightfield, Jason leads capital formation and financial strategy. Since January 2025, he also serves as a strategic advisor to CERO Energy, a waste-to-energy technology company focused on the production of sustainable aviation fuel and other renewable fuels. Prior to founding Lightfield, Jason held senior investment roles at Basalt Infrastructure Partners between January 2019 and March 2023, Ares Management between January 2015 and December 2018, and Energy Investors Funds between December 2013 and December 2014, where he structured and executed transactions across the power, energy, digital and transportation infrastructure sectors. He began his career in investment banking at Citigroup and Soci t G n rale. Jason graduated from the Jerome Fisher Program in Management & Technology at the University of Pennsylvania, receiving Bachelor of Science degrees from The Wharton School and the School of Engineering and Applied Sciences. We believe Mr. Kahan s deep expertise in infrastructure and real assets, including renewable energy and digital infrastructure, provides valuable experience in identifying and evaluating acquisition opportunities in the real estate sector, making him well qualified to serve on our board. Jared Berli n , who will serve as a director upon completion of this offering, is currently a Partner at Thames Capital Management, a global investment fund focused on public equities. He has over 25 years of experience in institutional public equity investing, specializing in technology, business services, and industrial end markets. Prior to co-founding Thames Capital Management in 2016, Mr. Berlin held senior investment roles at Citadel Securities, Cobalt Capital and was a Senior Analyst at Cantillon Capital Management from 2003 to 2011, a global equity long/short fund with over $10 billion in assets under management. From 1998 to 2003, he served as an Analyst at Geo Capital, a multi-billion-dollar investment firm based in New York specializing in small-cap public equities, with an emphasis on technology and business services. Mr. Berlin earned his undergraduate degree from the University of Wisconsin Madison in 1997. We believe Mr. Berlin s extensive background in institutional public equity investing, with a focus on technology, business services, and industrial end markets, brings significant financial and analytical expertise that makes him well qualified to serve on our board. Jonathan Sassover , who will serve as a director upon completion of this offering, has served as a Managing Partner and Co-Founder of The Pine Street Group since December 2018. He is responsible for identifying, sourcing and executing on the firm s investments, in addition to focusing on post-acquisition integrations and operational improvement initiatives at portfolio companies. Since December 2018, Jonathan has also served as the co-chairman and co-founder of Prime Providers, a multi-disciplinary home and community services agency based in Southern California. Prior to founding The Pine Street Group he was an investment professional at Alden Global Capital, a multi-billion dollar event-oriented & distressed investment firm where he focused on investing in the healthcare, industrials, financial services, and media sectors. Jonathan began his career as an investment banker at the Credit Suisse Group where he worked in the Financial Sponsor Group focused on financing transactions for private equity owned companies. Jonathan received a Juris Doctor from Columbia Law School (James Kent & Harlan Fiske Stone Scholar ) and a Bachelor of Arts from the University of Pennsylvania (magna cum laude ). He is admitted to practice law in the state of California. We believe Mr. Sassover is well qualified to serve as a director due to his extensive investment and leadership experience. Seth Schorr , who will serve as a director upon completion of this offering, has served as CEO of Fifth Street Gaming and Chairman of the Downtown Grand Hotel & Casino, overseeing a diverse portfolio of casinos, restaurants, and entertainment venues, since 2011. Schorr s career began in 1991 with leadership roles at iconic properties including Wynn Resorts, Bellagio, The Mirage, and Treasure Island. Schorr founded the Nevada Gaming Control Board s Esports Technical Advisory Committee, which helped establish the regulatory framework for legal esports wagering in Nevada. Schorr co-founded GMA Consulting, a leading gaming, hospitality, integrated resort and sports & entertainment research and consulting firm. He also co-founded Evenplay, a platform that merges real-money wagering with skill-based competition across virtual sports. In 2017, Schorr launched BettorView, a patented media platform delivering sports betting content to casinos, bars, and stadiums nationwide. Building on his ability to identify underserved markets, he also founded JefeBet in 2021, a multimedia and entertainment brand focused on the U.S. Latino community. Schorr also served on the board of directors of Skillz Inc., a leading eSports gaming platform, between August 2022 and September 2024. Beyond gaming, he leads Dunbar, an unclaimed property services company, and founded the UNLV Incubator to support early-stage technology startups. A graduate of the University of Pennsylvania, Schorr is an active member of Young Presidents Organization ( YPO ) and currently serves on several civic and cultural boards, including the Nevada State Board of Museums and History and the Downtown Las Vegas Alliance. Schorr holds Bachelor of Arts degree in History from the University of Pennsylvania. We believe Mr. Schorr is well qualified to serve as a director due to his extensive governance experience, having served on multiple public company boards in both the United States and Canada. His board service, combined with his operational leadership, provides a unique perspective across industries ranging from hospitality and gambling to financial services and technology. With respect to the experiences of our management team, and their respective affiliates, past performance is not a guarantee (i) that we will be able to identify a suitable candidate for our initial business combination or (ii) of success with respect to any business combination we may consummate. You should not rely on the historical performance of any member of our management team and their respective affiliates (either individually or collectively) as indicative of our future performance. For more information on the experience and background of our management team, see the sections entitled Management and Proposed Business . Prior SPAC Experience Certain of our directors and executive officers have previously been involved in one or more special purpose acquisition companies. Brian D. Friedman, our Chairman, and Benjamin A. Friedman, our Chief Executive Officer and Chief Financial Officer, previously served as executive officers and directors of BOA Acquisition Corp. ( BOA ) (NYSE: BOAS), a special purpose acquisition company that completed its initial public offering in February 2021, raising approximately $230 million in gross proceeds. On October 21, 2022, BOA s stockholders approved a business combination with Selina Hospitality PLC ( Selina ), and the merger closed in late October 2022, after which Selina began trading on Nasdaq under ticker SLNA. As a result of the transaction, BOA survived as a wholly owned subsidiary of Selina, and its shareholders became shareholders of Selina through the exchange. Neither Mr. Brian Friedman nor Mr. Benjamin Friedman is currently serving as an officer or director of any other SPAC as of the date of this prospectus. Business Opportunity and Strategic Advantages Our sponsor, management team, and advisors maintain extensive relationships across the real estate and infrastructure sectors. Our real estate network incorporates best-in class owners, operators, developers, tenants, brokers, service providers and advisors. Furthermore, we have substantive contacts within the technology space as a result of investments made by members of our Sponsor and management team. This includes relationships with leading venture capital and private equity firms as well as founders and operators of real estate, infrastructure, and technology companies. We intend to leverage this network to gain exclusive opportunities to identify attractive business targets in these industries. We anticipate that target business candidates may be brought to our attention from various unaffiliated sources, including but not limited to, real estate private equity and venture capital firms, investment banking firms, consultants, legal and accounting firms, and large business enterprises. Upon completion of this offering, members of our management team will communicate actively with our various networks to articulate the appropriate parameters for a potential business combination target. In addition, we have recruited and organized a group of accomplished individuals that bring to us public company governance, executive leadership, operations oversight and capital markets expertise. Our board members have served as directors, officers, partners and as owner/operators across a variety of publicly-listed and privately-owned companies. Their sector specific experience is accretive and will allow for significant opportunities for any potential business combination. They are well versed in public equity investing, private and public M&A, divestitures, and corporate strategy across the real-estate and technology sectors, which we believe will make our company a highly desirable merger partner. We believe our competitive strengths include the following: Depth of Team and Access to Resources . Our Sponsor, management team and advisors relationships are extensive across the real estate and Real Estate and Infrastructure industries. Our real estate network incorporates best-in class owners, operators, developers, tenants, brokers, service providers and advisors. Furthermore, we have substantive contacts within the technology space as a result of investments made by members of our Sponsor and management team. This network includes deep relationships with blue-chip venture capital and private equity firms and founders of both Real Estate and Infrastructure companies and technology companies. We intend to leverage this network to gain exclusive opportunities to identify attractive business targets in these industries. Sourcing Channels and Leading Industry Relationships . We believe our capabilities, reputation and deep industry relationships will provide us with a differentiated pipeline of acquisition opportunities that would be difficult for other participants in the market to replicate. Prior SPAC Experience . Certain members of our management team have significant SPAC experience, as founders, investors or advisors in SPAC transactions, including serving as executive officers of BOA Acquisition Corp. We believe their experience in SPAC transactions provide us with a distinctive advantage with respect to understanding the process of sourcing, evaluating and executing an initial business combination, as well as positioning us as an attractive partner with prospective target companies compared to SPACs with management teams that have no such prior experience. Execution and Structuring Capability . We believe our management team s expertise and reputation will allow us to source and complete transactions with structural attributes that present an attractive investment thesis. These types of transactions are typically complex and require creativity, industry knowledge and expertise, rigorous due diligence, extensive negotiations and documentation. We believe that by focusing our search on transactions that possess these characteristics, we can identify potential targets that offer attractive risk/reward profiles based on their valuations and structural characteristics. Public Company Experience . Certain members of our management team have extensive experience as public company executives and/or board members. We believe this experience will serve as a key competitive advantage, positioning us as an attractive long term partner to management teams of potential target companies and allowing us to help to create long-term value post-closing of the initial business combination. As described in Proposed Business Sourcing of Potential Business Combination Targets and Management Conflicts of Interest , certain of our officers and directors currently serve as directors, officers, or advisors of other companies and, in such capacities have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. As a result, there may be potential material conflicts of interest between our sponsor and members of our management team on one hand, and purchasers in this offering on the other. Such current fiduciary and contractual duties to other entities could, in some circumstances, also affect the availability or timing of the proprietary transaction opportunities made available to us. Our amended and restated memorandum and articles of association will provide that to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for to any director or officer on the one hand, and us, on the other. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for one or more entities to which he or she has fiduciary, contractual or other obligations or duties, he or she will honor these obligations and duties to present such business combination opportunity to such entities first, and only present it to us if such entities reject the opportunity and he or she determines to present the opportunity to us. While no member of the management team will have any duty to offer acquisition opportunities to us, they may become aware of a potential transaction that is an attractive opportunity for us, which they may decide to share with us. Conflicts may arise from their affiliation with our company, their provision of services both to us and to third-party clients, as well as from actions undertaken by them for their own account. In performing services for other clients and also when acting for their own account, they may take commercial steps which may have an adverse effect on us. Such services include investment management activities on behalf of themselves and other investment advisory clients in companies that may be an attractive opportunity for us or that may be competitive to a potential business opportunity to us. Please see Management Conflicts of Interest , for additional information regarding certain potential conflicts of interest relating to the Founder Group. Members of our management team may participate in the formation of, invest in (on behalf of themselves, their affiliates or its and their clients), or become an officer or director of, any other blank check company prior to completion of our initial business combination. As a result, members of our management team could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. Because there are numerous special purpose acquisition companies seeking to enter into an initial business combination with available targets, the competition for available targets with attractive fundamentals or business models may increase, which could cause target companies to demand improved financial terms. Attractive target companies and deals could also become scarcer for other reasons, such as economic or industry sector downturns (including a negative public perception of mergers involving SPACs), geopolitical tensions, or increases in the cost of additional capital needed to close business combinations or operate targets post-business combination. Thus, our ability to identify and evaluate a target company may be impacted by significant competition among other special purpose acquisition companies in pursuing business combination transaction candidates and significant competition may impact the attractiveness of the acquisition terms that we will be able to negotiate. Business Strategy, Investment Criteria and Target Characteristics Our business strategy is to identify and complete our initial business combination with a company that will benefit from our sponsor, management team, board of directors, and strategic advisors significant and extensive operational expertise. We believe our sector expertise coupled with our broad network will provide day-one synergies and accretive growth opportunities for our merger partner. We will leverage our relationship network and deal sourcing capabilities to identify potential target companies with distinct competitive advantages in the Real Estate and Infrastructure sector and, in particular, potential target companies that offer innovative solutions that are designed to optimize conventional business practices in the Real Estate and Infrastructure sector. Consistent with this strategy, we have identified the general criteria and guidelines we believe are important in evaluating prospective target companies. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target that does not meet these criteria or guidelines. Real Estate and Infrastructure Technology: We will focus our search on identifying one or more companies that have unique and disruptive technological capabilities centered upon the Real Estate and Infrastructure sector. We plan to prioritize businesses that can benefit from our sponsor and management team s network and operational expertise. Growth Potential: We will seek to acquire one or more businesses that have the potential for significant revenue growth opportunities through a combination of organic growth, market share increases, innovative technological solutions, and vertical or horizontal integration. We plan to leverage our combined experience to help scale the business in an accretive manner post-close. Target Acquisition Size: We will seek to acquire one or more established businesses with an aggregate enterprise value greater than $500 million, determined in the sole discretion of our officers and directors based on reasonably accepted valuation standards and methodologies. We believe this size range offers the most opportunities through our proprietary network and will allow us to deliver the greatest potential value to shareholders. Competitive Moat: We will seek to acquire one or more established businesses that have competitive advantages and proprietary technology allowing for the disruption of conventional business practices. As such, we expect to look for target companies with a large total addressable market, scalability, best-in-class management, strong adoption rates, and domain expertise. Highly Recurring Revenue and Proven Unit Economics: We will seek to acquire one or more businesses with strong unit economics and a diverse customer base, focusing on companies with established and growing recurring revenue streams. We do not plan to target startups, highly leveraged businesses, or those with unproven or speculative business models. Management Team: We will seek to acquire one or more businesses led by experienced management teams with a compelling growth strategy and operational diligence. We will prioritize target companies with management teams that have a proven record of driving revenue growth, creating shareholder value, and upholding the highest standards of corporate financial controls and integrity. Benefit from Being a Public Company: We plan to acquire one or more businesses that are well-positioned to benefit from being publicly traded, including enhanced access to capital and a broader investor base. We will focus on businesses that can leverage public/private valuation multiples to drive shareholder returns. These criteria are not intended to be exhaustive or exclusive. Any evaluation relating to the merits of a particular business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. We may ultimately enter into a business combination with a target that does not meet the above criteria and guidelines. In such event, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the Securities and Exchange Commission (the SEC ). Our Acquisition Process While we have not selected any specific business combination target and we have not, nor has anyone on our behalf, engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to an initial business combination with us, we have engaged in an extensive research effort to identify a large number of potential targets. We intend to leverage our resources and network for efficient outreach to commence immediately after the date of this prospectus. Our effort will be focused on creating proprietary transaction opportunities. We believe personal relationships built over time are critical not just in generating transaction opportunities, but also in consummating a business combination. In evaluating a prospective target business, we expect to conduct a thorough due diligence review which will encompass, among other things, meetings with incumbent management and employees, document reviews, inspection of facilities, as well as a review of financial, operational, legal and other information which will be made available to us. We are not prohibited from pursuing an initial business combination with a company that is affiliated with members of our management team or sponsor non-managing members. In the event we seek to complete our initial business combination with a business that is affiliated with members of our management team, we, or a committee of independent and disinterested directors, will obtain an opinion from an independent investment banking firm that is a member of the Financial Industry Regulatory Authority ( FINRA ), or from an independent registered public accounting firm, that such an initial business combination is fair to our company from a financial point of view. Our sponsor will directly or indirectly own our securities following this offering, and accordingly, it may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. There is no agreement, arrangement, or understanding between our sponsor and us or any of our officers and directors with respect to determining whether to proceed with a business combination. The nominal purchase price paid by our sponsor for the founder shares and the purchase price paid by our sponsor for the private placement units may significantly dilute the implied value of your public shares in the event we consummate an initial business combination, and our sponsor is likely to make a substantial profit on its investment in us in the event we consummate an initial business combination, even if the business combination causes the trading price of our ordinary shares to decline materially. Members of our management team may from time to time become aware of potential business opportunities, one or more of which we may desire to pursue, for a business combination, but we have not (nor has anyone on our behalf) engaged in any substantive discussions, directly or indirectly, with any business combination target with respect to a business combination transaction with us. As described in Proposed Business Sourcing of Potential Business Combination Targets and Management Conflicts of Interest , certain of our officers and directors currently serve as directors, officers, or advisors of other companies and, in such capacities have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. As a result, there may be potential material conflicts of interest between our sponsor and members of our management team on one hand, and purchasers in this offering on the other. Such current fiduciary and contractual duties to other entities could, in some circumstances, also affect the availability or timing of the proprietary transaction opportunities made available to us. Our amended and restated memorandum and articles of association will provide that to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for to any director or officer on the one hand, and us, on the other. While no member of the management team will have any duty to offer acquisition opportunities to us, they may become aware of a potential transaction that is an attractive opportunity for us, which they may decide to share with us. Conflicts may arise from their affiliation with our company, their provision of services both to us and to third-party clients, as well as from actions undertaken by them for their own account. In performing services for other clients and also when acting for their own account, they may take commercial steps which may have an adverse effect on us. Such services include investment management activities on behalf of themselves and other investment advisory clients in companies that may be an attractive opportunity for us or that may be competitive to a potential business opportunity to us. Members of our management team and our board of directors may participate in the formation of, invest in (on behalf of themselves, their affiliates or its and their clients), or become an officer or director of, any other blank check company prior to completion of our initial business combination. As a result, members of our management team and board of directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. Because there are numerous special purpose acquisition companies seeking to enter into an initial business combination with available targets, the competition for available targets with attractive fundamentals or business models may increase, which could cause target companies to demand improved financial terms. Attractive target companies and deals could also become scarcer for other reasons, such as economic or industry sector downturns (including a negative public perception of mergers involving SPACs), geopolitical tensions, or increases in the cost of additional capital needed to close business combinations or operate targets post-business combination. Thus, our ability to identify and evaluate a target company may be impacted by significant competition among other special purpose acquisition companies in pursuing business combination transaction candidates and significant competition may impact the attractiveness of the acquisition terms that we will be able to negotiate. Initial Business Combination We will have up to 24 months from the closing of this offering to consummate an initial business combination. However, if we anticipate that we may not be able to consummate our initial business combination within 24 months, we may also hold a shareholder vote at any time to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to consummate an initial business combination (as well as to modify the substance or timing of our obligation to redeem 100% of our public shares if we have not consummated an initial business combination within the time periods described herein or with respect to any other provisions relating to shareholders rights or pre-initial business combination activity). There is no limit on the number of times our shareholders can vote to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to complete an initial business combination and any such extension may be for any amount of time. As described herein, our sponsor, executive officers, directors and director nominees have agreed that they will not propose any such amendment unless we provide our public shareholders with the opportunity to redeem their public shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account, divided by the number of then outstanding public shares, subject to the limitations described herein. Our sponsor will lose its entire investment in us if our initial business combination is not completed within 24 months from the closing of this offering unless we extend the amount of time we have to consummate an initial business combination by obtaining shareholder approval to amend our amended and restated memorandum and articles of association. While we do not currently intend to seek such shareholder approval, we may elect to do so in the future. There is no limit on the number of extensions that we may seek. If we do not or are unable to extend the time period to consummate our initial business combination, our sponsor s investment in our founder shares and our private placement units (including component securities as well as any securities underlying those component securities) will be worthless. If we do not complete our initial business combination within the completion window and do not hold a shareholder vote to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to consummate an initial business combination, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (less taxes payable and up to $100,000 of interest to pay liquidation and dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject, in each case, to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There is no limitation on our ability to raise funds privately or through loans in connection with our initial business combination. Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the trust account (excluding any taxes payable on the interest earned on the trust account) at the time of our agreement to enter into our initial business combination. If our securities are no longer listed on Nasdaq, we will not be obligated to satisfy such 80% test. Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm that is a member of FINRA or from an independent registered public accounting firm, with respect to the satisfaction of such criteria. We do not currently intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination, although there is no assurance that will be the case. Additionally, pursuant to Nasdaq s rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the outstanding equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our initial business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of Nasdaq s 80% of net assets test. If the initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the transactions and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking shareholder approval, as applicable. Our amended and restated memorandum and articles of association will require the affirmative vote of a majority of our board of directors, which must include a majority of our independent directors, to approve our initial business combination (or such other vote as the applicable law or stock exchange rules then in effect may require). We do not believe we will need to raise additional funds following this offering in order to meet the expenditures required for operating our business. However, if our estimates of the costs of identifying a target business, undertaking in-depth due diligence and negotiating an initial business combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to our initial business combination. Moreover, we may need to obtain additional financing either to complete our initial business combination or because we become obligated to redeem a significant number of our public shares upon completion of our initial business combination, in which case we may issue additional securities or incur debt in connection with such business combination. If we raise additional funds through equity or convertible debt issuances, our public shareholders may suffer significant dilution and these securities could have rights that rank senior to our public shares. If we raise additional funds through the incurrence of indebtedness, such indebtedness would have rights that are senior to our equity securities and could contain covenants that restrict our operations. Further, as described above, due to the anti-dilution rights of our founder shares, our public shareholders may incur material dilution. In addition, we intend to target businesses with enterprise values that are greater than we could acquire with the net proceeds of this offering and the sale of the private placement securities, and, as a result, if the cash portion of the purchase price exceeds the amount available from the trust account, net of amounts needed to satisfy redemptions by public shareholders, we may be required to seek additional financing to complete such proposed initial business combination. We may also obtain financing prior to the closing of our initial business combination to fund our working capital needs and transaction costs in connection with our search for and completion of our initial business combination. There is no limitation on our ability to raise funds through the issuance of equity or equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to any forward purchase agreements, backstop or similar agreements we may enter into following the consummation of this offering or otherwise. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our business combination. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to cease operations and liquidate the trust account. In addition, following our initial business combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations. Prior to the date of this prospectus, we will file a registration statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended (the Exchange Act ). As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. Corporate Information Our executive offices are located at 2600 Virginia Ave NW, Suite T23 Management Office Washington, D.C. 20037, our telephone number is +1 (888) 211-3261 and our website is www.betonamerica2.com. Our website and the information contained on, or that can be accessed through, the website is not deemed to be incorporated by reference in, and is not considered part of, this prospectus. You should not rely on any such information in making your decision whether to invest in our securities. We are a Cayman Islands exempted company. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have received a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 30 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer, which means the aggregate worldwide market value of our Class A ordinary shares that is held by non-affiliates equals or exceeds $700.0 million as of the end of the prior June 30th; and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the aggregate worldwide market value of our Class A ordinary shares held by non-affiliates equaled or exceeded $250.0 million as of the end of the prior June 30th, and (2) our annual revenues equaled or exceeded $100.0 million during such completed fiscal year or the aggregate worldwide market value of our Class A ordinary shares held by non-affiliates equaled or exceeded $700.0 million as of the prior June 30th. In addition, after completion of this offering and prior to the consummation of a business combination, only holders of our Class B ordinary shares will have the right to vote on the appointment or removal of directors. As a result, Nasdaq will consider us to be a controlled company within the meaning of Nasdaq corporate governance standards. Under Nasdaq corporate governance standards, a company of which more than 50% of the voting power for the appointment of directors is held by an individual, group or another company is a controlled company and may elect not to comply with certain corporate governance requirements. We currently do not intend to rely on the controlled company exemption, but may do so in the future. Accordingly, if we choose to do so, you will not have the same protections afforded to shareholders of companies that are subject to all of Nasdaq s corporate governance requirements. The Offering In making your decision whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled Risk Factors. Securities Offered 20,000,000 units (or 23,000,000 units if the underwriters option to purchase additional units is exercised in full), at $10.00 per unit, each unit consisting of: one Class A ordinary share; and one right to receive one-eighth (1/8) of one Class A share upon consummation of our initial business combination. No fractional shares will be issued upon exchange of the rights, so you must hold rights in multiples of eight in order to receive shares for all of your rights upon closing of a business combination. Proposed Nasdaq symbols Units: THEOU Class A ordinary shares: THEO Rights: THEOR Trading commencement and separation of Class A ordinary shares and rights The units are expected to begin trading promptly after the date of this prospectus. The Class A ordinary shares and rights constituting the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless CCM informs us of its decision to allow earlier separate trading, subject to our having filed the Current Report on Form 8-K described below and having issued a press release announcing when such separate trading will begin. Once the Class A ordinary shares and rights commence separate trading, holders will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into Class A ordinary shares and rights. Additionally, the units will automatically separate into their component parts and will not be traded after completion of our initial business combination. In no event will the Class A ordinary shares and rights be traded separately until we have filed with the SEC a Current Report on Form 8-K which includes an audited balance sheet of our company reflecting our receipt of the gross proceeds at the closing of this offering. We will file the Current Report on Form 8-K promptly after the closing of this offering. If the underwriters option to purchase additional units is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the underwriters option to purchase additional units. Units: Number outstanding before this offering: None Number outstanding after this offering: 20,600,000(1) Ordinary Shares: Number outstanding before this offering: 7,666,667(2)(4) Number outstanding after this offering: 28,266,667(1)(3)(4) Rights: Number outstanding before this offering: None Number of rights to be outstanding after this offering and the Private Placements: 20,600,000(1) (1) Assumes no exercise of the underwriters option to purchase additional units and the forfeiture by our sponsor of 1,000,000 founder shares for no consideration and includes an aggregate of 600,000 Class A ordinary shares included in the private placement units. (2) Consists solely of founder shares and includes up to 1,000,000 shares that are subject to forfeiture by our sponsor for no consideration, depending on the extent to which the underwriters option to purchase additional units is exercised. (3) Includes 20,000,000 public shares, 7,666,667 founder shares and 600,000 Class A ordinary shares underlying private placement units. (4) Founder shares are classified as Class B ordinary shares, which shares automatically convert into Class A ordinary shares at the time of our initial business combination or at any time prior thereto at the option of the holder thereof, in each case, on a one-for-one basis, subject to adjustment as described below adjacent to the caption Founder shares conversion and anti-dilution rights. Terms of the Rights Each holder of a right will receive one-eighth (1/8) of a Class A ordinary share upon consummation of our initial business combination. No additional consideration will be required to be paid by a holder of rights in order to receive the additional shares upon consummation of a business combination, as the consideration related thereto has been included in the unit purchase price paid for by investors in this offering. In the event we will not be the survivor upon completion of our initial business combination, each holder of a right will be required to affirmatively convert his, her or its rights in order to receive the 1/8 share underlying each right (without paying any additional consideration) upon consummation of the business combination. If we are unable to complete an initial business combination within the required time period and we liquidate the funds held in the trust account, holders of rights will not receive any of such funds for their rights and the rights will expire worthless. It is not our intent to issue fractional shares upon conversion of any rights. Any rounding down and extinguishment may be done with or without any in lieu cash payment or other compensation being made to the holder of the relevant rights. We shall reserve such amount of our profits or share premium in order to pay up the par value of each share issuable in respect of each right. Appointment of directors; voting rights Prior to the consummation of our initial business combination, only holders of our Class B ordinary shares will have the right to vote on the appointment or removal of directors. Holders of the Class A ordinary shares will not be entitled to vote on the appointment or removal of directors during such time. These provisions of our amended and restated memorandum and articles of association may only be amended if approved by a majority of at least 90% of our ordinary shares voting at a general meeting. With respect to any other matter submitted to a vote of our shareholders, including any vote in connection with our initial business combination, except as required by applicable law or stock exchange rule, holders of our Class A ordinary shares and holders of our Class B ordinary shares will vote together as a single class, with each share entitling the holder to one vote. Founder shares Our sponsor, Bet on America II Sponsor LLC currently holds an aggregate of 7,666,667 founder shares acquired for an aggregate purchase price of $25,000, or approximately $0.003 per share. Subject to the sponsor non-managing members purchasing, through the sponsor, the private placement units allocated to them simultaneously with the closing of this offering, the sponsor will issue membership interests at a nominal purchase price to the sponsor non-managing members reflecting their interest in an aggregate of 3,000,000 founder shares held by the sponsor. The number of founder shares issued was determined based on the expectation that the founder shares would represent 25% of the outstanding ordinary shares upon the completion of this offering. The purchase price of the founder shares was determined by dividing the amount of cash contributed to us by the number of founder shares issued. If we increase or decrease the size of this offering we will effect a capitalization or share repurchase or redemption or other appropriate mechanism, as applicable, with respect to our Class B ordinary shares immediately prior to the consummation of the offering in such amount as to maintain the ownership of our sponsor at 25% of the issued and outstanding ordinary shares upon the consummation of this offering. Our public shareholders may incur immediate and substantial dilution upon such adjustment. Up to 1,000,000 founder shares are subject to forfeiture by our sponsor depending on the extent to which the underwriters option to purchase additional units is exercised. As described below under Transfer restrictions on founder shares, following consummation of our initial business combination, the founder shares will be subject to a lock-up agreement that will release such shares at specified times and share prices. The founder shares are identical to the Class A ordinary shares included in the units being sold in this offering, except that: prior to the closing of our initial business combination, only holders of our founder shares have the right to vote on the appointment or removal of directors and on continuing the company in a jurisdiction outside the Cayman Islands (as further described herein); the founder shares are subject to certain transfer restrictions contained in a letter agreement that our sponsor, directors and officers will enter into with us, as described in more detail below; pursuant to such letter agreement, our sponsor, directors and officers will agree to waive: (1) their redemption rights with respect to any founder shares, private shares and public shares held by them, as applicable, in connection with the completion of our initial business combination; (2) their redemption rights with respect to any founder shares, private shares and public shares held by them in connection with a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if we have not consummated our initial business combination within the completion window or (B) with respect to any other provision relating to shareholders rights or pre-initial business combination activity; and (3) their rights to liquidating distributions from the trust account with respect to any founder shares they hold if we fail to complete our initial business combination within the completion window (although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the completion window). If we submit our initial business combination to our public shareholders for a vote, we will complete our initial business combination only if we receive approval pursuant to an ordinary resolution under Cayman Islands law, which requires the affirmative vote of a simple majority of the shareholders who attend and vote at a general meeting of the company. In such case, sponsor, officers and directors will agree to vote any founder shares, private shares and any public shares held by them in favor of our initial business combination (except any public shares such parties may purchase in compliance with the requirements of Rule 14e-5 under the Exchange Act would not be voted in favor of approving the business combination transaction). As a result, in addition to our sponsor s founder shares, we would need 10,977,778, or 54.9%, of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination (assuming all issued and outstanding shares are voted, the underwriters option to purchase additional units is not exercised and the parties to the letter agreement do not acquire any Class A ordinary shares) in order to have such initial business combination approved; the founder shares are automatically convertible into our Class A ordinary shares at the time of our initial business combination or at any time prior thereto at the option of the holder thereof, on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described in more detail below; the holders of the founder shares are entitled to registration rights; and the sponsor non-managing members are not granted any shareholder or other rights in addition to those afforded to our other public shareholders, and will only be issued Class A membership interests and Class B membership interests in the sponsor representing their interests in the founder shares and private placement units, with no right to control the sponsor or vote or dispose of any securities held by the sponsor, including the founder shares or the private placement units (including component securities as well as any securities underlying those component securities) held by the sponsor. The sponsor non-managing members are not required to (i) hold any units, Class A ordinary shares or public rights they may purchase in this offering or thereafter for any amount of time, or enter into a lock-up agreement with us or the underwriters with respect to any units, Class A ordinary shares, (ii) vote any Class A ordinary shares they may own at the applicable time in favor of our initial business combination or (iii) refrain from exercising their right to redeem their public shares at the time of our initial business combination. The sponsor non-managing members will have the same rights to the funds held in the trust account with respect to the Class A ordinary shares underlying the units they may purchase in this offering as the rights afforded to our other public shareholders. However, if the sponsor non-managing members purchase any units which they have expressed an interest in purchasing, then the sponsor non-managing members will potentially have different interests than our other public shareholders in approving our initial business combination and otherwise exercising their rights as public shareholders because of their indirect ownership of private placement units and the founder shares as further discussed in this prospectus. The interests of the members of the sponsor are denominated in three classes of membership interest units: (i) Class A membership units representing interests in the founder shares on a one-for-one basis and (ii) Class B membership units that will represent an interest in the private placement units on a one-for-one basis. The Class A membership units are further subdivided into two series: (i) Class A-1 membership units representing interests in the founder shares that will be subject to forfeiture in the event that the overallotment option is not exercised in full and (ii) Class A-2 membership units representing interests in the founder shares that will not be subject to forfeiture whether or not the over-allotment option is exercised in full. All members of the sponsor, including the managing member of the sponsor, and any sponsor non-managing member that may join the sponsor concurrently with this offering will hold classes of membership units representing their proportional interest in the founder shares and private placement units, respectively. Upon the closing of this offering, the Class A membership units will collectively represent an interest in 7,666,667 founder shares, and the Class B membership units will collectively represent an interest in 400,000 private placement units held by our sponsor. Pursuant to an agreement of all members of the sponsor, the management and control of the sponsor is vested exclusively with the managing member, without any voting, veto, consent or other participation rights by any non-managing members regardless of their unit ownership. All matters submitted to a vote by the managing member will require the affirmative vote of the Class A membership units held only by the managing member, without regard to any membership interests held by any non-managing members. As a result, sponsor non-managing members will have no right to control the sponsor, or participate in any decision regarding the disposal of any security held by the sponsor or otherwise. Transfer restrictions on founder shares Except as described herein, pursuant to a letter agreement entered into with us, our sponsor, officers and directors will agree not to assign or sell any founder shares held by it until the earlier to occur of: (A) one year after completion of our initial business combination; or (B) if the closing price of our ordinary shares equals or exceeds $12.00 per share (as adjusted for share sub-divisions, share dividends, reorganizations, recapitalizations and other similar transactions) for any 20 trading days within any 30-trading day period commencing any time 150 days after completion of our initial business combination. Any permitted transferees would be subject to the same restrictions and other agreements of our sponsor with respect to any founder shares. We refer to such transfer restrictions throughout this prospectus as the lock-up. Notwithstanding the foregoing, if we complete a liquidation, merger, share exchange, reorganization or other similar transaction after our initial business combination that results in all of our public shareholders having the right to exchange their ordinary shares for cash, securities or other property, the founder shares will be released from the lock-up. Except in certain limited circumstances, no member of the sponsor (including the sponsor non-managing members) may sell, transfer, assign, pledge, mortgage, charge, hypothecate, exchange or otherwise dispose, directly or indirectly, (a Transfer ) all or any portion of its membership interests in the sponsor. For more information, see Principal Shareholders Restrictions on Transfers of Founder Shares and Private placement Units . Founder shares conversion and anti-dilution rights The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of our initial business combination on a one-for-one basis, subject to adjustment as provided herein, or at any time prior thereto at the option of the holder thereof. In the case that additional Class A ordinary shares, or equity-linked securities, are issued or deemed issued in excess of the amounts sold in this offering and related to the closing of our initial business combination, the ratio at which Class B ordinary shares shall convert into Class A ordinary shares will be adjusted (unless the holders of a majority of the outstanding Class B ordinary shares agree to waive such anti-dilution adjustment with respect to any such issuance or deemed issuance) so that the number of Class A ordinary shares issuable upon conversion of all Class B ordinary shares will equal, in the aggregate, on an as-converted basis, 25% of the total number of all ordinary shares outstanding upon completion of this offering plus all Class A ordinary shares and equity-linked securities issued or deemed issued in connection with our initial business combination, excluding any Class A ordinary shares, subject to vesting and any other restrictions, issued or deemed issued to (i) our sponsor (or its members or affiliates) in connection with the consummation of this offering, (ii) any seller in the initial business combination and (iii) any Class A ordinary shares issued to our sponsor (or its members or affiliates) upon conversion of working capital loans. Any conversion of Class B ordinary shares described herein will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. In no event will the Class B ordinary shares convert into Class A ordinary shares at a rate of less than one-to-one. Appointment and removal of directors and continuing the company outside of the Cayman Islands; voting right s Except as set forth below, holders of record of our Class A ordinary shares and Class B ordinary shares are entitled to one vote for each share held on all matters to be voted on by shareholders. Unless specified in our amended and restated memorandum and articles of association or as required by the Companies Act or stock exchange rules, an ordinary resolution under Cayman Islands law and our amended and restated memorandum and articles of association, which requires the affirmative vote of at least a simple majority of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at the applicable general meeting of the company is generally required to approve any matter voted on by our shareholders. Approval of certain actions requires a special resolution under Cayman Islands law, which (except as specified below) requires the affirmative vote of at least two-thirds of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at the applicable general meeting, and pursuant to our amended and restated memorandum and articles of association, such actions include amending our amended and restated memorandum and articles of association and approving a statutory merger or consolidation with another company. There is no cumulative voting with respect to the appointment of directors, meaning, following our initial business combination, the holders of more than 50% of our ordinary shares voted for the appointment of directors can appoint all of the directors. Prior to the consummation of our initial business combination, only holders of our Class B ordinary shares will (i) have the right to vote on the appointment and removal of directors and (ii) be entitled to vote on continuing our company in a jurisdiction outside the Cayman Islands (including any special resolution required to adopt new constitutional documents as a result of our approving a transfer by way of continuation in a jurisdiction outside the Cayman Islands). Holders of our Class A ordinary shares will not be entitled to vote on these matters during such time. These provisions of our amended and restated memorandum and articles of association may only be amended if approved by a special resolution passed by the affirmative vote of at least 90% (or, where such amendment is proposed in respect of the consummation of our initial business combination, two-thirds) of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at the applicable general meeting of the company. With respect to any other matter submitted to a vote of our shareholders prior to or in connection with the completion of our initial business combination, including any vote in connection with our initial business combination, except as required by law, holders of the founder shares and holders of our public shares will vote together as a single class, with each share entitling the holder to one vote. If we seek shareholder approval of our initial business combination, we will complete our initial business combination only if we receive approval by way of an ordinary resolution under Cayman Islands law and our amended and restated memorandum and articles of association, which requires the affirmative vote of at least a simple majority of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at the applicable general meeting of the company. In such case, our sponsor, officers and directors have agreed to vote their founder shares and any public shares purchased during or after this offering (including in open market and privately-negotiated transactions) in favor of our initial business combination (not including any public shares such parties may purchase in compliance with the requirements of Rule 14e-5 under the Exchange Act would not be voted in favor of approving the business combination transaction). As a result, in addition to our sponsor s founder shares, we would need 7,666,667, or 54.9%, of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved, assuming all outstanding shares are voted, the over-allotment option is not exercised and the parties to the letter agreement do not acquire any Class A ordinary shares. Assuming that only the holders of one-third of our issued and outstanding ordinary shares, representing a quorum under our amended and restated memorandum and articles of association, vote their shares at a general meeting of the company, we will not need any public shares in addition to our founder shares to be voted in favor of an initial business combination in order to approve an initial business combination. Private placement units and underlying securities Our sponsor has committed to purchase an aggregate of 400,000 private placement units of our company for an aggregate purchase price of $4,000,000 (whether or not the underwriters over-allotment option is exercised in full) in separate private placements (referred to herein as the Private Placement ). The private placement units will be identical to the units sold in this offering except that, so long as they are held by our sponsor or its permitted transferees, the private placement units (including their component securities as well as any securities underlying those component securities) (i) are locked-up until thirty (30) days following the completion of our initial business combination, (ii) will be entitled to registration rights and (iii) the Class A ordinary shares included as a component of the private units will not be entitled to redemption rights. In addition, the sponsor non-managing members have expressed to us an interest in purchasing, indirectly through the purchase of non-managing sponsor membership interests, an aggregate of 300,000 private placement units (whether or not the over-allotment option is exercised) at a price of $10.00 per unit for an aggregate purchase price of $3,000,000 in a private placement that will close simultaneously with the closing of this offering. Subject to the sponsor non-managing members purchasing, through the sponsor, the private placement units allocated to them simultaneously with the closing of this offering, the sponsor will issue membership interests at a nominal purchase price to the sponsor non-managing members reflecting their interest in an aggregate of 3,000,000 founder shares held by the sponsor. The sponsor non-managing members will have no right to vote the founder shares, private placement units or securities underlying the private placement units that they hold indirectly through their membership interests in the sponsor. The underwriters have committed to use a portion of their underwriting discount and commission to purchase an aggregate of 200,000 private placement units (or 230,000 private placement units in the aggregate if the underwriters over-allotment option is exercised in full) at a price of $10.00 per unit, or $2,000,000 in the aggregate (or $2,300,000 in the aggregate if the underwriters overallotment option is exercised in full), in a private placement that will close simultaneously with the closing of this offering. The private placement units will be identical to the units sold in this offering, subject to certain limited exceptions as described in this prospectus. The private placement units shall be subject to the transfer restrictions as described under Principal Shareholders Restrictions on Transfers of Founder Shares and Private Placement Units . Transfer restrictions on private placement units Subject to certain exceptions, pursuant to a letter agreement entered into with us, our sponsor will agree not to transfer, assign or sell the private placement units (including component securities as well as any securities underlying those component securities) until 30 days after the completion of our initial business combination (except as described under the section of this prospectus entitled Principal Shareholders Restrictions on Transfers of Founder Shares and Private placement Units ). The private placement units (including the underlying private shares, the rights and the Class A ordinary shares issuable upon conversion of the rights) to be purchased by the underwriters and/or their permitted designees, are deemed underwriters compensation by FINRA and are subject to limitations in accordance with FINRA Rule 5110. Proceeds to be held in trust account The rules of Nasdaq provide that at least 90% of the gross proceeds from this offering and the sale of the private placement units be deposited in a trust account. Of the net proceeds we will receive from this offering and the sale of the private placement units described in this prospectus, $200,000,000 ($10.00 per unit), or $230,000,000 if the underwriters option to purchase additional units is exercised in full, will be deposited into a segregated trust account located in the United States with Odyssey Trust Company acting as trustee and an aggregate of $1,400,000 (or $1,100,00 if the underwriters over-allotment option is fully exercised) will be used to pay expenses in connection with the closing of this offering and for working capital following this offering. The funds in the trust account will be (i) invested only in U.S. government treasury bills with a maturity of 185 days or less or in money market funds that meet certain conditions under Rule 2a-7 under the Investment Company Act and that invest only in direct U.S. government obligations and/or (ii) deposited in an interest bearing demand deposit account at a U.S.-chartered commercial bank with consolidated assets of $100 billion or more. Except with respect to interest earned on the funds held in the trust account that may be released to us as described below, the funds held in the trust account will not be released from the trust account until the earliest of: (1) the completion of our initial business combination; (2) the redemption of any public shares properly submitted in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (i) to modify the substance or timing of our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if we have not consummated our initial business combination within the completion window or (ii) with respect to any other provision relating to shareholders rights or pre-initial business combination activity; and (3) the redemption of all of our public shares if we are unable to complete our initial business combination within the completion window, subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. The sponsor non-managing members are not granted any shareholder or other rights in addition to those afforded to our other public shareholders, and will only be issued Class B membership interests in the sponsor representing their interests in the private placement units, with no right to control the sponsor or vote or dispose of any securities held by the sponsor, including the founder shares and the private placement units held by the sponsor. Further, the sponsor non-managing members are not required to (i) hold any units, Class A ordinary shares or public rights they may purchase in this offering or thereafter for any amount of time, or enter into a lock-up agreement with us or the underwriters with respect to any units or Class A ordinary shares, (ii) vote any Class A ordinary shares they may own at the applicable time in favor of our initial business combination or (iii) refrain from exercising their right to redeem their public shares at the time of our initial business combination. The sponsor non-managing members will have the same rights to the funds held in the trust account with respect to the Class A ordinary shares underlying the units they may purchase in this offering as the rights afforded to our other public shareholders. However, if the sponsor non-managing members purchase any units for which they have expressed an interest in purchasing, then the sponsor non-managing members will potentially have different interests than our other public shareholders in approving our initial business combination and otherwise exercising their rights as public shareholders because of their indirect ownership of private placement units and founder shares as further discussed in this prospectus. Any trading decisions made by any of the foregoing entities will be made by them based on market conditions at the time of the proposed sale or redemption. CCM s affiliates will not become sponsor non-managing members or receive any economic or other interest in the sponsor. Anticipated expenses and funding sources Unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use. The funds in the trust account will be invested only in U.S. government treasury bills with a maturity of 185 days or less or in money market funds that meet certain conditions under Rule 2a-7 under the Investment Company Act and that invest only in direct U.S. government obligations and/or deposited in an interest bearing demand deposit account at a U.S.-chartered commercial bank with consolidated assets of $100 billion or more. Based upon current interest rates, we expect the trust account to generate approximately $8,500,000 of interest annually (assuming an interest rate of 4.25% per year); however, we can provide no assurances regarding this amount. Unless and until we complete our initial business combination, we may pay our expenses only from loans or additional investments from our sponsor, members of our management team or any of their respective affiliates or other third parties, although they are under no obligation or other duty to loan funds to, or invest in, us, and provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of our initial business combination. If we complete our initial business combination, we expect to repay such loaned amounts out of the proceeds of the trust account released to us. In the event that our initial business combination does not close, we may use a portion of the working capital held outside the trust account to repay such loaned amounts but no proceeds from our trust account would be used to repay such loaned amounts. Up to $2,500,000 of all loans made to us by our sponsor, an affiliate of our sponsor or our officers and directors may be convertible into private placement units at a price of $10.00 per unit at the option of the lender at the time of the business combination. In addition, after the completion of this offering, our board of directors may approve additional working capital loans from our sponsor or third parties for the purpose of funding working capital, which loans may be converted into our private placement units shares or rights. The units and the underlying securities would be identical to the private placement units. Except for the foregoing, the terms of such loans, if any, have not been determined and no written agreements exist with respect to such loans. Conditions to completing our initial business combination We will have up to 24 months from the closing of this offering to consummate an initial business combination. We may also hold a shareholder vote at any time to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to consummate an initial business combination (as well as to modify the substance or timing of our obligation to redeem 100% of our public shares if we have not consummated an initial business combination within the time periods described herein or with respect to any other provisions relating to shareholders rights or pre-initial business combination activity) for another two three-month periods. There is no limit on the number of times our shareholders can vote to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to complete an initial business combination and any such extension may be for any amount of time. As described herein, our sponsor, executive officers, directors and director nominees have agreed that they will not propose any such amendment unless we provide our public shareholders with the opportunity to redeem their public shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account, divided by the number of then outstanding public shares, subject to the limitations described herein. If we do not complete our initial business combination within the completion window, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned on the funds held in the trust account (less taxes payable and up to $100,000 of interest to pay liquidation and dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidating distributions, if any), and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject, in each case, to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There is no limitation on our ability to raise funds privately or through loans in connection with our initial business combination. Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the trust account (excluding any taxes payable on the interest earned on the trust account) at the time of our agreement to enter into our initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses, we will obtain an opinion from an independent investment banking firm that is a member of FINRA or from an independent registered public accounting firm. We will complete our initial business combination only if the post-transaction company in which our public shareholders own shares will own or acquire 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target business sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our initial business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test. Permitted purchases of public shares and public rights by our affiliates If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our management team, sponsor or any of their respective affiliates may purchase public shares or rights in privately negotiated transactions or in the open market prior to the completion of our initial business combination, and may purchase public shares and rights following completion of our initial business combination. Additionally, at any time at or prior to our initial business combination, subject to applicable securities laws (including with respect to material nonpublic information), our management team, sponsor, the sponsor non-managing members or any of their respective affiliates may enter into transactions with investors and others to provide them with incentives to acquire public shares, vote their public shares in favor of our initial business combination or not redeem their public shares. However, they have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. None of the funds held in the trust account will be used to purchase public shares or rights in such transactions. If they engage in such transactions, they will be restricted from making any such purchases when they are in possession of any material nonpublic information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Exchange Act. We do not currently anticipate that such purchases, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. Any such purchases will be reported pursuant to Section 13 and Section 16 of the Exchange Act to the extent such purchasers are subject to such reporting requirements. Additionally, in the event our management team, sponsor or any of their respective affiliates were to purchase shares or rights from public shareholders such purchases would be structured in compliance with the requirements of Rule 14e-5 under the Exchange Act including, in pertinent part, through adherence to the following: our registration statement/proxy statement filed for our business combination transaction would disclose the possibility that our management team, sponsor or any of their respective affiliates may purchase shares or rights from public shareholders outside the redemption process, along with the purpose of such purchases; if our management team, sponsor or any of their respective affiliates were to purchase shares or rights from public shareholders, they would do so at a price no higher than the price offered through our redemption process; our registration statement/proxy statement filed for our business combination transaction would include a representation that any of our securities purchased by our management team, sponsor, or any of their respective affiliates would not be voted in favor of approving the business combination transaction; our management team, sponsor or any of their respective affiliates would not possess any redemption rights with respect to our securities or, if they do acquire and possess redemption rights, they would waive such rights; and we would disclose in a Form 8-K, before our general meeting to approve the business combination transaction, the following material items: the amount of our securities purchased outside of the redemption offer by our management team, sponsor or any of their respective affiliates, along with the purchase price; the purpose of the purchases by our management team, sponsor or any of their respective affiliates; the impact, if any, of the purchases by our management team, sponsor or any of their respective affiliates on the likelihood that the business combination transaction will be approved; the identities of our security holders who sold to our management team, sponsor or any of their respective affiliates (if not purchased on the open market) or the nature of our security holders (e.g., 5% security holders) who sold to our management team, sponsor or any of their respective affiliates; and the number of our securities for which we have received redemption requests pursuant to our redemption offer. Please see Proposed Business Permitted Purchases of Our Securities for a description of how such persons will determine from which shareholders to seek to acquire securities. The purpose of any such transaction could be to (1) increase the likelihood of obtaining shareholder approval of the business combination, (2) reduce the number of public rights outstanding and/or increase the likelihood of approval on any matters submitted to the public rights holders for approval in connection with our initial business combination or (3) satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public float of our securities may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Please see Risk Factors If we seek shareholder approval of our initial business combination, our management team, sponsor, the sponsor non-managing members or any of their respective affiliates may elect to purchase public shares or rights, which may influence a vote on a proposed business combination and reduce the public float of our securities. Redemption rights for public shareholders upon completion of our initial business combination We will provide our public shareholders with the opportunity to redeem, regardless of whether they abstain, vote for, or vote against, our initial business combination, all or a portion of their public shares upon the completion of our initial business combination at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest, divided by the number of then outstanding public shares, subject to the limitations described herein. The amount in the trust account is initially anticipated to be $10.00 per public share. The per share amount we will distribute to investors who properly redeem their shares will not be reduced by the deferred underwriting commissions we will pay to the underwriters. The redemption right will include the requirement that any beneficial owner on whose behalf a redemption right is being exercised must identify itself in order to validly redeem its shares. Each public shareholder may elect to redeem its public shares irrespective of whether they vote for or against, or vote at all in connection with, the proposed transaction. There will be no redemption rights upon the completion of our initial business combination with respect to our rights. Our sponsor, officers and directors will enter into a letter agreement with us, pursuant to which they will agree to waive their redemption rights with respect to any founder shares, private shares and any public shares held by them in connection with the completion of our initial business combination. The sponsor non-managing members will have the same rights to the funds held in the trust account with respect to the Class A ordinary shares underlying the units they may purchase in this offering as the rights afforded to our other public shareholders. However, if the sponsor non-managing members purchase any units for which they have expressed an interest in purchasing, then the sponsor non-managing members will potentially have different interests than our other public shareholders in approving our initial business combination and otherwise exercising their rights as public shareholders because of their indirect ownership of private placement units and founder shares as further discussed in this prospectus. Manner of conducting redemptions We will provide our public shareholders with the opportunity to redeem, regardless of whether they abstain, vote for, or vote against, our initial business combination, all or a portion of their public shares upon the completion of our initial business combination either: (1) in connection with a general meeting called to approve the business combination; or (2) by means of a tender offer. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under applicable law or stock exchange listing requirement. Under Nasdaq rules, asset acquisitions and share purchases would not typically require shareholder approval while direct mergers with our company where we do not survive and any transactions where we issue more than 20% of our outstanding ordinary shares or seek to amend our amended and restated memorandum and articles of association would require shareholder approval. We may conduct redemptions without a shareholder vote pursuant to the tender offer rules of the SEC unless shareholder approval is required by law or stock exchange listing requirements or we choose to seek shareholder approval for business or other legal reasons. So long as we obtain and maintain a listing for our securities on Nasdaq, we will be required to comply with such rules. If our completion window is extended by an amendment to our amended and restated memorandum and articles of association, holders of our public shares will be entitled to vote on such amendment and to redeem their shares in connection with any such extension, regardless of whether they abstain, vote in favor of or vote against such extension. If a shareholder vote is not required and we do not decide to hold a shareholder vote for business or other reasons, we will, pursuant to our amended and restated memorandum and articles of association: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. Whether or not we maintain our registration under the Exchange Act or our listing on Nasdaq, we will provide our public shareholders with the opportunity to redeem their public shares by one of the two methods listed above. Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we and our sponsor will terminate any plan established in accordance with Rule 10b5-1 to purchase our Class A ordinary shares in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering more than a specified number of public shares, which number may be based on a net tangible asset or cash requirement which may be contained in the agreement relating to our initial business combination. If public shareholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete such initial business combination. If, however, shareholder approval of the transaction is required by applicable law or stock exchange listing requirement, or we decide to obtain shareholder approval for business or other reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and file proxy materials with the SEC. We expect that a final proxy statement would be mailed to public shareholders at least 20 days prior to the shareholder vote. However, we expect that a draft proxy statement would be made available to such shareholders well in advance of such time, providing additional notice of redemption if we conduct redemptions in conjunction with a proxy solicitation. Although we are not required to do so, we currently intend to comply with the substantive and procedural requirements of Regulation 14A in connection with any shareholder vote even if we are not able to maintain our Nasdaq listing or Exchange Act registration. If we seek shareholder approval, we will complete our initial business combination only if we receive approval pursuant to an ordinary resolution under Cayman Islands law, which requires the affirmative vote of at least a simple majority of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at the applicable general meeting of the company. A quorum for such general meeting will be present if the holders of at least one-third of issued and outstanding shares entitled to vote at the meeting are represented in person or by proxy. Our sponsor will count toward this quorum and, pursuant to the letter agreement, our sponsor, officers and directors have agreed to vote their founder shares and any public shares purchased during or after this offering (including in open market and privately-negotiated transactions) in favor of our initial business combination (not including any public shares such parties may purchase in compliance with the requirements of Rule 14e-5 under the Exchange Act would not be voted in favor of approving the business combination transaction). For purposes of seeking approval by way of an ordinary resolution, non-votes will have no effect on the approval of our initial business combination once a quorum is obtained. As a result, in addition to our sponsor s founder shares, we would need 10,977,778, or 54.9%, of the 20,000,000 public shares sold in this offering to be voted in favor of an initial business combination in order to have our initial business combination approved, assuming all outstanding shares are voted, the over-allotment option is not exercised and the parties to the letter agreement do not acquire any Class A ordinary shares. Assuming that only the holders of one-third of our issued and outstanding ordinary shares, representing a quorum under our amended and restated memorandum and articles of association, vote their shares at a general meeting of the company, we will not need any public shares in addition to our founder shares to be voted in favor of an initial business combination in order to approve an initial business combination. However, if our initial business combination is structured as a statutory merger or consolidation with another company under Cayman Islands law, the approval of our initial business combination will require a special resolution, which requires the affirmative vote of at least two-thirds of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at the applicable general meeting of the company. In addition, prior to the closing of our initial business combination, only holders of our Class B ordinary shares (i) will have the right to appoint and remove directors prior to or in connection with the completion of our initial business combination and (ii) will be entitled to vote on continuing our company in a jurisdiction outside the Cayman Islands (including any special resolution required to adopt new constitutional documents as a result of our approving a transfer by way of continuation in a jurisdiction outside the Cayman Islands). These quorum and voting thresholds, and the voting agreements of our sponsor and management team, may make it more likely that we will consummate our initial business combination. Each public shareholder may elect to redeem their public shares irrespective of whether they vote for or against the proposed transaction, or whether they do not vote or abstain from voting on the proposed transaction, or whether they were a public shareholder on the record date for the general meeting held to approve the proposed transaction. If our completion window is extended by an amendment to our amended and restated memorandum and articles of association, holders of our public shares will be entitled to vote on such amendment and to redeem their shares in connection with any such extension, regardless of whether they abstain, vote in favor of or vote against such extension. Redemptions of our public shares may be subject to a net tangible asset test or cash requirement pursuant to an agreement relating to our initial business combination. For example, the proposed business combination may require: (1) cash consideration to be paid to the target or its owners; (2) cash to be transferred to the target for working capital or other general corporate purposes; or (3) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration we would be required to pay for all ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we will not complete the business combination or redeem any shares, and all ordinary shares submitted for redemption will be returned to the holders thereof. Tendering share certificates in connection with a tender offer or redemption rights We may require our public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in street name, to either tender their certificates to our transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up to two business days prior to the vote on the proposal to approve our initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically using The Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option, rather than simply voting against the initial business combination. The tender offer or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public shareholders to satisfy such delivery requirements, which will include the requirement that any beneficial owner on whose behalf a redemption right is being exercised must identify itself in order to validly redeem its shares. Limitation on redemption rights of shareholders holding more than 15% of the shares sold in this offering if we hold a shareholder vote Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association will provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), is restricted from redeeming its shares with respect to more than an aggregate of 15% of the shares sold in this offering, without our prior consent. We believe the restriction described above will discourage shareholders from accumulating large blocks of shares and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our affiliates to purchase their shares at a significant premium to then-current market price or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us or our affiliates at a premium to then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. Redemption rights in connection with proposed amendments to our memorandum and articles of association Our amended and restated memorandum and articles of association will provide that any of its provisions related to pre-business combination activity (including the requirement to fund the trust account and not release such amounts except in specified circumstances and to provide redemption rights to public shareholders as described herein) may be amended if approved by holders of at least two-thirds of our ordinary shares who attend and vote at a general meeting of the company, and corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended if approved by holders of a majority of our ordinary shares. In all other instances (other than the appointment of directors), our amended and restated memorandum and articles of association will provide that it may be amended by holders of at least two-thirds of our ordinary shares who attend and vote thereon at a general meeting of the company, subject to applicable provisions of Cayman Islands law, or applicable stock exchange rules. Prior to an initial business combination, we may not issue additional securities that can vote on amendments to our amended and restated memorandum and articles of association or on our initial business combination or that would entitle holders thereof to receive funds from the trust account. Our sponsor, members of our management team and the sponsor non-managing members, who will beneficially own 25% of our ordinary shares upon the closing of this offering (assuming they do not purchase any units in this offering and assuming no exercise of the underwriters option to purchase additional units and the corresponding forfeiture of 1,000,000 founder shares by our sponsor), may participate in any vote to amend our amended and restated memorandum and articles of association and/or trust agreement and will have the discretion to vote in any manner they may choose. Our sponsor, officers and directors will agree, pursuant to a letter agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if we have not consummated our initial business combination within the completion window or (B) with respect to any other provision relating to shareholders rights or pre-initial business combination activity, unless we provide our public shareholders with the opportunity to redeem their ordinary shares upon approval of any such amendment at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest, divided by the number of then outstanding public shares. Our sponsor, officers and directors will enter into a letter agreement with us, pursuant to which they will agree to waive their redemption rights with respect to any founder shares, private shares and any public shares held by them in connection with the completion of our initial business combination. Any permitted transferees would be subject to the same restrictions and other agreements of our sponsor with respect to any founder shares. The sponsor non-managing members are not required to (i) hold any units, Class A ordinary shares or public rights they may purchase in this offering or thereafter for any amount of time, or enter into a lock-up agreement with us or the underwriters with respect to any units, Class A ordinary shares or public rights, (ii) vote any Class A ordinary shares they may own at the applicable time in favor of our initial business combination or (iii) refrain from exercising their right to redeem their public shares at the time of our initial business combination. The sponsor non-managing members will have the same rights to the funds held in the trust account with respect to the Class A ordinary shares underlying the units they may purchase in this offering as the rights afforded to our other public shareholders. However, if the sponsor non-managing members purchase any units for which they have expressed an interest in purchasing, then the sponsor non-managing members will potentially have different interests than our other public shareholders in approving our initial business combination and otherwise exercising their rights as public shareholders because of their indirect ownership of private placement units and founder shares as further discussed in this prospectus. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be used to pay amounts due to any public shareholders who exercise their redemption rights as described above under Proposed Business Redemption rights for public shareholders upon completion of our initial business combination , to pay the underwriters their deferred underwriting commissions, to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination or used for redemption of our public shares, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. Redemption of public shares and distribution and liquidation if no initial business combinatio n Our amended and restated memorandum and articles of association will provide that we will have only the completion window to complete our initial business combination. If we are unable to complete our initial business combination within the completion window, we will: (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (less taxes payable and up to $100,000 to pay liquidation and dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidating distributions, if any), subject to applicable law; and (3) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. There will be no redemption rights or liquidating distributions with respect to our rights, which will expire worthless if we fail to complete our initial business combination within such completion window. Our sponsor, officers and directors will enter into a letter agreement with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to any founder shares and private shares held by them if we fail to complete our initial business combination within the completion window. However, if our sponsor or any of our officers, directors or any of their respective affiliates acquires public shares after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the completion window. Our sponsor, officers and directors will agree, pursuant to a letter agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to provide for the redemption of our public shares in connection with an initial business combination or to redeem 100% of our public shares if we have not consummated our initial business combination within the completion window or (B) with respect to any other provision relating to shareholders rights or pre-initial business combination activity, unless we provide our public shareholders with the opportunity to redeem their ordinary shares upon approval of any such amendment at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (less taxes payable and up to $100,000 of interest to pay liquidation and dissolution expenses), divided by the number of then outstanding public shares. Limited payments to insiders There will be no finder s fees, reimbursement, consulting fee, monies in respect of any payment of a loan or other compensation paid by us to our sponsor, officers or directors or our or any of their respective affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination (regardless of the type of transaction that it is). However, the following payments may be made to our sponsor, officers or directors, or our or their affiliates, and, if made prior to our initial business combination will be made from funds held outside the trust account: payment to our sponsor for office space, administrative and shared personnel support services, in an amount equal to $20,000 per month, commencing on the first date on which our securities are listed on Nasdaq; repayment of an aggregate of up to $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses; reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; repayment of loans which may be made by our sponsor, an affiliate of our sponsor or our officers and directors to finance transaction costs in connection with an intended initial business combination. Up to $2,500,000 of such loans may be convertible into private placement units of the post-business combination entity at a price of $10.00 per unit at the option of the lender; and Any such private placement units will be identical to the private placement units. Except for the foregoing, the terms of such loans, if any, have not been determined nor have any written agreements been executed with respect thereto. Our audit committee will review on a quarterly basis all payments that were made by us to our sponsor, officers or directors or our or any of their respective affiliates. Audit committee Concurrent with the listing of our units on Nasdaq, we will establish and will maintain an audit committee to, among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. Please see Management Committees of the Board of Directors Audit Committee for additional information. Conflicts of interest Members of our management team and board of directors may participate in the formation of, invest in (on behalf of themselves, their affiliates or its and their clients), or become an officer or director of, any other blank check company prior to completion of our initial business combination. As a result, members of our management team could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. As described in Proposed Business Sourcing of Potential Business Combination Targets and Management Conflicts of Interest , certain of our officers and directors currently serve as directors, officers, or advisors of other companies and, in such capacities have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. As a result, there may be potential material conflicts of interest between our sponsor and members of our management team on one hand, and purchasers in this offering on the other. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, sponsor non-managing members, directors or members of our management team; accordingly, such affiliated person(s) may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination as such affiliated person(s) would have interests different from our public shareholders and would likely not receive any financial benefit unless we consummated such business combination. Our sponsor paid only a nominal aggregate purchase price of $25,000 for the founder shares, or approximately $0.003 per share. Accordingly, our management team, which owns interests in our sponsor, may be more willing to pursue a business combination with a riskier or less-established target business than would be the case if our sponsor had paid the same per share price for the founder shares as our public shareholders paid for their public shares. In the event our sponsor or members of our management team provide loans to us to finance transaction costs and/or incur expenses on our behalf in connection with an initial business combination, such persons may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination as such loans may not be repaid and/or such expenses may not be reimbursed unless we consummate such business combination. The potential conflicts described above may limit our ability to enter into a business combination or other transactions. These circumstances could give rise to numerous situations where interests may conflict. There can be no assurance that these or other conflicts of interest with the potential for adverse effects on the company and investors will not arise. Indemnity Our sponsor will agree that it will be liable to us if and to the extent any claims by a third party (other than our independent registered public accounting firm) for services rendered or products sold to us, or a prospective target business with which we have entered into a written letter of intent, confidentiality or similar agreement or business combination agreement, reduce the amount of funds in the trust account to below: (1) $10.00 per public share; or (2) the actual amount per public share held in the trust account as of the date of the liquidation of the trust account, if less than $10.00 per share due to reductions in the value of the trust assets, except as to any claims by a third party that executed a waiver of any and all rights to the monies held in the trust account (whether any such waiver is enforceable) and except as to any claims under our indemnity of the underwriters of this offering against certain liabilities, including liabilities under the Securities Act. We have not independently verified whether our sponsor has sufficient funds to satisfy its indemnity obligations and believe that our sponsor s only assets are securities of our company and, therefore, our sponsor may not be able to satisfy those obligations. We have not asked our sponsor to reserve for such obligations. Risks We are a newly incorporated Cayman Islands exempted company that has conducted no operations and has generated no revenues. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision whether to invest in our securities, you should take into account not only the background of our management team, but also the special risks we face as a blank check company. This offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Please see Proposed Business Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419 for additional information concerning how Rule 419 blank check offerings differ from this offering. You should carefully consider these and the other risks set forth in the section entitled Risk Factors in this prospectus. An investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together with the other information contained in this prospectus, before making a decision to invest in our units. If any of the following events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment: There is substantial doubt about our ability to continue as a going concern. We are a newly incorporated Cayman Islands exempted company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. Past performance by our management team and their respective affiliates may not be indicative of future performance of an investment in us. Our shareholders may not be afforded an opportunity to vote on our proposed initial business combination, which means we may complete our initial business combination even though a majority of our shareholders do not support such a combination. Your only opportunity to affect the investment decision regarding a potential business combination may be limited to the exercise of your right to redeem your shares from us for cash. If we seek shareholder approval of our initial business combination, our sponsor will agree to vote in favor of such initial business combination, regardless of how our public shareholders vote. If we seek shareholder approval of our initial business combination, our management team, sponsor, the sponsor non-managing members or any of their respective affiliates may elect to purchase public shares or rights, which may influence a vote on a proposed business combination and reduce the public float of our Class A ordinary shares or public rights. You will not be entitled to protections normally afforded to investors of many other blank check companies. You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. Therefore, to liquidate your investment, you may be forced to sell your public shares or rights, potentially at a loss. If the net proceeds of this offering and the sale of the private placement securities not being held in the trust account are insufficient to allow us to operate for the 24 months following the closing of this offering, it could limit the amount available to fund our search for a target business or businesses and our ability to complete our initial business combination, and we will depend on loans from our sponsor, its affiliates or members of our management team to fund our search and to complete our initial business combination. The ability of our public shareholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combination with a target. We are not required to obtain an opinion from an independent registered public accounting or investment banking firm, and consequently, you may have no assurance from an independent source that the price we are paying for the business is fair to our shareholders from a financial point of view. We may not be able to consummate an initial business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate. We may engage in a business combination with one or more target businesses that have relationships with entities that may be affiliated with, managed by or otherwise associated with, members of our management team, sponsor or sponsor non-managing members. Since our sponsor will lose its entire investment in us if our initial business combination is not completed, and because our sponsor, officers and directors and any other holder of our founder shares, including our sponsor non-managing members, directly or indirectly may profit substantially from a business combination as a result of their ownership of founder shares even under circumstances where our public shareholders would experience losses in connection with their investment, a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination, including in connection with the shareholder vote in respect thereto. Our sponsor controls a substantial interest in us and thus may exert a substantial influence on actions requiring a shareholder vote, potentially in a manner that you do not support. Our management team, sponsor and their respective affiliates allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial business combination. Our management team, sponsor and their respective affiliates may have competitive pecuniary interests that conflict with our interests. The other risks and uncertainties discussed in Risk Factors and elsewhere in this prospectus. Dilution The following table illustrates the difference between the public offering price and our net tangible book value (NTBV), as adjusted to give effect to this offering and to redemptions of our public shares at varying levels, assuming the full exercise and no exercise of the over-allotment option. See the section Dilution. The below calculations (A) assume that (i) no ordinary shares are issued to shareholders of a potential business combination target as consideration or issuable by a post-business combination company, for instance under an equity or employee share purchase plan, (ii) no ordinary shares and convertible equity or debt securities are issued in connection with additional financing that we may seek in connection with an initial business combination, and (iii) no working capital loans are converted into private placement units as further described in this prospectus, and (B) assumes the issuance of 20,000,000 Class A ordinary shares (or 23,000,000 Class A ordinary shares if the underwriters over-allotment option is exercised in full), 600,000 private placement units (or 630,000 private placement units if the underwriters over-allotment option is exercised in full) and 7,666,667 founder shares (up to 1,000,000 of which are assumed to be forfeited in the scenario in which the underwriters over-allotment option is not exercised). Since we intend to seek an initial business combination with a target company having an aggregate enterprise value greater than $500 million, which is greater than the anticipated net proceeds of this offering and the sale of private placement units, we may need to issue additional ordinary shares, preference shares and convertible equity or debt securities in connection with an initial business combination. Any such issuances of equity securities may significantly dilute the equity interest of investors in this offering, which dilution would even further increase if the anti-dilution provisions in the Class B ordinary shares resulted in the issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion of the Class B ordinary shares. At August 8, 2025, our net tangible book value was a deficit of $(139,659), or approximately $(0.02) per Class B ordinary share. Assuming various redemption scenarios and after giving effect to the sale of 20,000,000 Class A ordinary shares included in the units we are offering by this prospectus, the sale of the private placement units and the deduction of underwriting commissions and estimated expenses of this offering, our pro forma net tangible book value at August 8, 2025 would have been the following to the public shareholders on a per-share basis immediately after this offering: Offering Price of $10.00 per Unit 25% of Max Redemption 50% of Max Redemption 75% of Max Redemption Max Redemption NTBV Difference NTBV Difference NTBV Difference NTBV Difference NTBV Difference Assuming Full Exercise of Over-Allotment Option $7.09 $ 2.91 $ 6.53 $ 3.47 $ 5.63 $ 4.37 $ 4.01 $ 5.99 $ 0.13 $ 9.87 Assuming No Exercise of Over-Allotment Option $7.08 $ 2.92 $ 6.52 $ 3.48 $ 5.62 $ 4.38 $ 4.00 $ 6.00 $ 0.15 $ 9.85 For purposes of presenting the Maximum Redemption scenario, we have reduced our NTBV after this offering (assuming no exercise of the underwriters option to purchase additional units) by $200,000,000 because holders of up to approximately 100% of our public shares may redeem their shares for a pro rata share of the aggregate amount then on deposit in the trust account at a per share redemption price equal to the amount in the trust account as set forth in our tender offer or proxy materials (initially anticipated to be the aggregate amount held in trust two business days prior to the commencement of our tender offer or general meeting, including interest, divided by the number of Class A ordinary shares sold in this offering). If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our sponsor, and directors, officers, advisors or any of their affiliates may also purchase shares in privately negotiated transactions or in the open market prior to the completion of our initial business combination, and may purchase public shares and rights following completion of our initial business combination. In the event of any such purchases of our shares prior to the completion of our initial business combination, the number of ordinary shares subject to redemption will be reduced by the amount of any such purchases, increasing the pro forma net tangible book value per share. See Proposed Business Permitted Purchases of Our Securities . Summary Financial Data The following table summarizes the relevant financial data for our business and should be read with our financial statements, which are included in this prospectus. We have not had any significant operations to date, so only balance sheet data is presented. August 8, 2025 Actual As Adjusted Balance Sheet Data: Working capital (deficit)(1) $ (139,659 ) $ 1,089,606 Total assets(2) $ 149,126 $ 201,404,606 Total liabilities(3) $ 144,435 $ 8,315,000 Value of ordinary shares subject to possible conversion(4) $ $ 200,000,000 Shareholders equity(5) $ 4,691 $ (6,910,394 ) (1) The as adjusted calculation includes $1,399,915 of cash held outside the trust account plus $4,691 of actual shareholder s equity on August 8, 2025, less the overallotment liability of $315,000. (2) The as adjusted calculation equals $200,000,000 cash held in trust from the proceeds of this offering, plus $1,399,915 in cash held outside the trust account plus $4,691 of actual shareholder s equity at August 8, 2025. (3) The as adjusted calculation includes $315,000 related to the fair value of the over-allotment option and $8,000,000 of deferred underwriting commissions. (4) The as adjusted calculation equals the as adjusted total assets, less the as adjusted total liabilities, less the as adjusted shareholder s equity. (5) Excludes 20,000,000 public shares which are subject to redemption in connection with our initial business combination. The as adjusted calculation equals the as adjusted total assets, less the as adjusted total liabilities, less the value of Class A ordinary shares that may be redeemed in connection with our initial business combination (initially $10.00 per share).
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+paid using available working capital funds (including proceeds from any promissory notes issued by us and funds released from the trust account upon completion of our initial business combination), but would not in any event be paid out of the Administrative Services Fee. As of the date of this prospectus, no arrangements are currently in place with respect to the payment of any finder s fee, advisory fee, consulting fee or success fee in order to effectuate the completion of our initial business combination, or with respect to the payment of a salary or other fee to our sponsor or an affiliate of our sponsor as an advisor or otherwise in connection with our initial business combination or any other transaction. Additionally, following consummation of a business combination, members of our management team will be entitled to reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination. As a result, there may be actual or potential material conflicts of interest between members of our management team, our sponsor and its affiliates on the one hand, and purchasers in this offering on the other. In addition to the foregoing, our officers and directors will receive indirect interests in the founder shares held by the sponsor as compensation for their services as officers and directors of the Company. Each of our directors will receive for their services as a director an indirect interest in the founder shares through membership interests in our sponsor. Each director will receive an indirect interest in 50,000 founder shares through membership interests in our sponsor. As a result of their indirect interest in the founder shares through membership interests in our sponsor, our management team may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. As a result, there may be actual or potential material conflicts of interest between our sponsor and its affiliates on the one hand, and purchasers in this offering on the other hand. See the sections titled Summary Sponsor Information , Summary Conflicts of Interest , Risk Factors Risks Relating to our Search for, and Consummation of or Inability to Consummate, a Business Combination Since our sponsor, officers and directors, and any other holders of our founder shares, including any non-managing sponsor investors, may lose their entire investment in us if our initial business combination is not completed (other than with respect to public shares they may acquire during or after this offering), a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination and Management Conflicts of Interest for more information. We have until the date that is 24 months from the closing of this offering (as may be extended by shareholder approval to amend our amended and restated memorandum and articles of association to extend the date by which we must consummate our initial business combination) or until such earlier liquidation date as our board of directors may approve, to consummate our initial business combination. If we anticipate that we may be unable to consummate our initial business combination within such 24-month period, we may seek shareholder approval to amend our amended and restated memorandum and articles of association to extend the date by which we must consummate our initial business combination. There are no limitations on the number of times we may seek shareholder approval for an extension or the length of time of any such extension (any such extension would be made in compliance with Nasdaq Rule 5101-2(d)). However, if we seek shareholder approval for an extension, holders of public shares will be offered an opportunity to redeem their shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (less taxes payable), divided by the number of then issued and outstanding public shares, subject to applicable law. If we are unable to complete our initial business combination within 24 months from the closing of this offering, or by such earlier liquidation date as our board of directors may approve, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (less taxes payable and up to $100,000 of interest income to pay dissolution expenses), divided by the number of then issued and outstanding public shares, subject to applicable law as further described herein. Currently, there is no public market for our units, Class A ordinary shares or warrants. We intend to apply to have our units listed on the Global Market tier of The Nasdaq Stock Market LLC, or Nasdaq, under the symbol AEAQU, on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on Nasdaq. We expect the Class A ordinary shares and warrants comprising the units to begin separate trading on the 52nd day following the date of this prospectus unless BTIG, the lead representative of the underwriters, informs us of its decision to allow earlier separate trading, subject to our satisfaction of certain conditions as described further herein. Once the securities comprising the units begin separate trading, we expect that the Class A ordinary shares and warrants will be listed on Nasdaq under the symbols AEAQ and AEAQW , respectively. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 52 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Table of Contents Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. No offer or invitation, whether directly or indirectly, is being or may be made to the public in the Cayman Islands to subscribe for any of our securities. Per Unit Total Public offering price $ 10.00 $ 200,000,000 Underwriting discounts and commissions(1) $ 0.55 $ 11,000,000 Proceeds, before expenses, to us $ 9.45 $ 189,000,000 ____________ (1) Includes $0.20 per unit, or $4,000,000 in the aggregate (or $4,600,000 in the aggregate if the underwriters over-allotment option is exercised in full), payable to the underwriters upon the closing of this offering. Also includes $0.35 per unit, or $7,000,000 in the aggregate (or $8,050,000 in the aggregate if the underwriters over-allotment option is exercised in full), payable to the underwriters for deferred underwriting commissions, which will be placed in a trust account located in the United States as described herein and released to the underwriters only upon the consummation of an initial business combination. See Underwriting for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private units described in this prospectus, $200,000,000, or $230,000,000 if the underwriters overallotment option is exercised in full ($10.00 per unit in either case), will be placed in a U.S.-based trust account with Continental Stock Transfer & Trust Company acting as trustee. The following table illustrates the difference between the public offering price per unit and our net tangible book value per share ( NTBV ), as adjusted to give effect to this offering and assuming the redemption of our public shares at varying levels and the exercise in full and no exercise of the over-allotment option. See the section titled Dilution for more information. As of September 30, 2025 Offering Price of $10.00 25% of Maximum Redemption 50% of Maximum Redemption 75% of Maximum Redemption 100% of Maximum Redemption NTBV NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price Assuming Full Exercise of Over-Allotment Option $ 7.13 $ 6.48 $ 3.52 $ 5.46 $ 4.54 $ 3.60 $ 6.40 $ (0.83 ) $ 10.83 Assuming No Full Exercise of Over-Allotment Option $ 7.12 $ 6.47 $ 3.53 $ 5.45 $ 4.55 $ 3.59 $ 6.41 $ (0.82 ) $ 10.82 Our sponsor and members of our management team will directly or indirectly own our securities following this offering, and accordingly, they may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Additionally, each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. As a result, there may be actual or potential material conflicts of interest between our sponsor and our management team and their respective affiliates on the one hand, and purchasers in this offering on the other. See the sections titled Summary Conflicts of Interest , Proposed Business Sourcing of Potential Business Combination Targets and Management Conflicts of Interest for more information. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2025. Sole Book-Running Manager BTIG , 2025 Table of Contents Table of Contents Page Summary 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: amended and restated memorandum and articles association refers to the amended and restated memorandum and articles association of the Company which will be adopted prior to the consummation of this offering; Class A ordinary shares are to the Class A ordinary shares of par value US$0.0001 each in the capital of the Company; Class B ordinary shares are to the Class B ordinary shares of par value US$0.0001 each in the capital of the Company; Companies Act are to the Companies Act (Revised) of the Cayman Islands as the same may be amended from time to time; company, we, us, our, or our company are to General Purpose Acquisition Corp., a Cayman Islands exempted company; Excise Tax shall mean the 1% U.S. federal excise tax that was implemented by the Inflation Reduction Act of 2022; founders are to Peter Georgiopoulos and Leonard Vrondissis; founder shares are to our Class B ordinary shares initially issued to our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares concurrently with or immediately following the consummation of our initial business combination or earlier at the option of the holder on a one-for-one basis, subject to adjustment as described herein (for the avoidance of doubt, such Class A ordinary shares will not be public shares with redemption rights); management or our management team are to our officers and directors (including our director nominees who will become directors at the consummation of this offering); ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; permitted withdrawals means amounts withdrawn or eligible to be withdrawn to pay for our taxes (which shall exclude the Excise Tax if any is imposed on us), such withdrawals can only be made from interest and not from the principal held in the trust account; private placement units are to the private placement units to be issued to our sponsor and to the underwriters in a private placement simultaneously with the closing of this offering (which private placement units are identical to the public units sold in this offering, subject to certain limited exceptions as described in this prospectus) and upon conversion of working capital loans, as further described in this prospectus; private placement shares are to the Class A ordinary shares underlying the private placement units issued to our sponsor and to the underwriters in a private placement simultaneously with the closing of this offering or upon conversion of working capital loans, as further described in this prospectus (such Class A ordinary shares delivered upon conversion shall not have any redemption rights or be entitled to liquidating distributions from the trust account if we fail to consummate an initial business combination); TABLE OF CONTENTS The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION, DATED NOVEMBER 18, 2025 PRELIMINARY PROSPECTUS $200,000,000 General Purpose Acquisition Corp. 20,000,000 Units General Purpose Acquisition Corp. is a newly organized blank check company incorporated as a Cayman Islands exempted company and formed for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to as our initial business combination. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. This is an initial public offering of our securities. Each unit has an offering price of $10.00 and consists of one Class A ordinary share, par value $0.0001 and one-half of one redeemable warrant. Accordingly, unless you purchase two public units, you will not be able to receive or trade a whole warrant. Each whole warrant entitles the holder thereof to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment, terms and limitations as described herein. The warrants will become exercisable 30 days after the completion of our initial business combination, and will expire five years after the completion of our initial business combination or earlier upon redemption or liquidation of the company, as described in this prospectus. Subject to the terms and conditions described in this prospectus, we may redeem the warrants for cash once the warrants become exercisable. The underwriters have a 45-day option from the date of this prospectus to purchase up to 3,000,000 additional public units to cover over-allotments, if any. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in our trust account calculated as of two business days prior to the consummation of the initial business combination, including interest earned on the funds held in the trust account (net of amounts withdrawn or eligible to be withdrawn to pay for our taxes (which shall exclude the 1% U.S. federal excise tax that was implemented by the Inflation Reduction Act of 2022 if any is imposed on us), divided by the number of then-issued and outstanding public shares, subject to applicable law and limitations and on the conditions described herein. As further described in this prospectus, our amended and restated memorandum and articles of association will provide that a public shareholder, together with any affiliate or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act of 1934, as amended (the Exchange Act )), will be restricted from redeeming its public shares with respect to more than an aggregate of 15% of the public shares sold in this offering, without our prior consent. If we do not consummate an initial business combination within 24 months from the closing of this offering or our board of directors approves an earlier liquidation, we will redeem 100% of the public shares for cash, subject to applicable law and certain conditions as described herein. We may seek shareholder approval to amend our amended and restated memorandum and articles of association to extend the date by which we must consummate our initial business combination. If we seek shareholder approval for an extension, and the related amendments are approved by the shareholders, holders of our public shares will be offered an opportunity to redeem their shares upon the implementation by the directors of any such amendment. Redemption rights may also be available to shareholders in certain other circumstances as described herein and in our amended and restated memorandum and articles of association. Our sponsor, General Purpose Acquisition Corp Services LLC, has agreed to purchase an aggregate of 400,000 private placement units (or up to 430,000 private placement units if the underwriters over-allotment option is exercised in full), at a price of $10.00 per unit, for an aggregate purchase price of $4,000,000 (or up to $4,300,000 if the underwriters over-allotment option is exercised in full) and the underwriters have agreed to purchase an aggregate of 200,000 private placement units (or up to 230,000 private placement units if the underwriters over-allotment option is exercised in full), at a price of $10.00 per unit, for an aggregate purchase price of $2,000,000 (or up to $2,300,000 if the underwriters over-allotment option is exercised in full), in each case in a private placement that will close simultaneously with the closing of this offering. We refer to these units throughout this prospectus as the private placement units. Each private placement warrant, upon aggregation of the fractional private placement warrants contained in each private placement unit, is exercisable to purchase one whole Class A ordinary share at a price of $11.50 per share, subject to adjustment, terms and limitations as described herein. The private placement warrants are identical to the warrants sold in this offering, subject to certain limited exceptions, as described in this prospectus. None of the private placement warrants will be redeemable by us. Each private placement share included in each private placement unit will not have any redemption rights or be entitled to liquidating distributions from the trust account if we fail to consummate an initial business combination. A portion of the proceeds from the sale of the private placement units will be placed in the trust account described below. The private placement units purchased by the underwriters are deemed underwriters compensation by the Financial Industry Regulatory Authority ( FINRA ) pursuant to Rules 5110(e)(1) and (e)(2) of the FINRA Manual. Further, our sponsor currently owns 5,750,000 of our Class B ordinary shares, par value $0.0001 per share (up to 750,000 of which are subject to forfeiture), which will automatically convert into Class A ordinary shares concurrently with or immediately following the consummation of our initial business combination or earlier at the option of the holder on a one-for-one basis (such Class A ordinary share delivered upon conversion will not have any redemption rights or be entitled to liquidating distributions from the trust account if we fail to consummate an initial business combination), subject to adjustment as described herein. Prior to the completion of our initial business combination, only holders of our Class B ordinary shares will be entitled to vote on the appointment and removal of directors or in a vote to transfer the company by way of continuation to a jurisdiction outside the Cayman Islands. The founder shares held by our sponsor were purchased for $25,000, or approximately $0.004 per share, which, as further described in this prospectus, may result in material dilution to public holders when converted into Class A ordinary shares or if the anti-dilution provision of the founder shares results in the issuance of Class A ordinary shares on a greater than one-to-one basis (for more information on dilution, also see the section entitled Dilution in this prospectus). As further described under Offering Other Considerations and Conflicts of Interest Compensation of Sponsor, Sponsor s Affiliates and Directors and Officers, we expect to make certain payments and reimbursements, or pay certain fees, to our sponsor, officers or directors, or our or their affiliates, including but not limited to the payment of $25,000 per month to our sponsor for office space, secretarial and administrative services. Our sponsor may also, but is not obligated to, enter into certain arrangements with us to finance transaction costs in connection with an initial business combination, including up to $1,500,000 of loans convertible into private placement units at a price of $10.00 per private placement unit at the option of the lender. As more fully discussed in the section of this TABLE OF CONTENTS private placement warrants are to the non-redeemable warrants underlying the private placement units issued to our sponsor and to the underwriters in a private placement simultaneously with the closing of this offering or upon conversion of working capital loans, as further described in this prospectus; public shareholders are to the holders of our public shares, including our sponsor and management team to the extent our sponsor and/or members of our management team purchase public shares, provided that our sponsor s and each member of our management team s status as a public shareholder will only exist with respect to such public shares; public shares are to our Class A ordinary shares sold as part of the public units in this offering (whether they are purchased in this offering or thereafter in the open market); public units are to the units sold at $10.00 per unit in this offering (whether they are purchased in the this offering or thereafter in the open market, including units that may be acquired by our sponsor or its affiliates in the open market following this offering), each unit consisting of one public share and one-half of one public warrant; public warrants are to the redeemable warrants sold as part of the public units in this offering (whether they are purchased in this offering or thereafter in the open market, including warrants that may be acquired by our sponsor or its affiliates in this offering or thereafter in the open market); sponsor are to General Purpose Acquisition Corp Services LLC, a Cayman Islands limited liability company acting by its manager from time to time. Peter Georgiopoulos and Leonard Vrondissis are the co-managers of the sponsor as of the date of this prospectus; and warrants are to our redeemable public warrants and non-redeemable private placement warrants, as further described in this prospectus. Any forfeiture of shares described in this prospectus will take effect as a surrender of shares for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any share dividends described in this prospectus will take effect as share capitalizations as a matter of Cayman Islands law. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. General We are a newly organized blank check company incorporated on July 25, 2025, as a Cayman Islands exempted company formed for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses or entities, which we refer to throughout this prospectus as our initial business combination. To date, our efforts have been limited to organizational activities as well as activities related to this offering. We have not selected any specific business combination target and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. We have generated no operating revenues to date and we do not expect that we will generate operating revenues until we consummate our initial business combination. General Purpose Acquisition Corp. Platform Our management team is composed of seasoned executives, operators, and investors with extensive experience in sourcing, evaluating, and executing complex transactions across both public and private markets. Collectively, our team has a demonstrated track record of building and scaling businesses, driving operational improvements, and creating shareholder value, having raised over $20 billion in private and public markets over the last 25 years. We TABLE OF CONTENTS prospectus entitled Management Conflicts of Interest, our officers and directors currently have certain relevant fiduciary duties or contractual obligations that may take priority over their duties to us and there may be a conflict of interest in our director s and officer s determination as to how much time to devote to our affairs and to which entity a particular business opportunity is presented. We may also decide to acquire one or more businesses affiliated with our sponsor or our officers or directors, or our directors, officers, sponsor and their affiliates may sponsor or become affiliated with entities that have a similar activity than ours. Further, our officers and directors have indirect economic interests in us and/or our sponsor and a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination since our sponsor, officers and directors may lose their entire investment in us if an initial business combination is not completed. As a result, there may be actual or potential material conflicts of interest between our sponsor and its affiliates on the one hand, and purchasers in this offering on the other hand. For more information, also see Summary Other Considerations and Conflicts of Interest, Risk Factors Risks Relating to our Sponsor and Management Team and Principal Shareholders. The following table illustrates the difference between the public offering price per unit and our net tangible book value per share ( NTBV ), as adjusted to give effect to this offering and assuming the redemption of our public shares included in the public units offered hereby at varying levels in the scenarios in which the over-allotment option is not exercised and exercised in full. See section entitled Dilution for more information. As of September 30, 2025 Offering Price of $10.00 per Unit 25% of Maximum Redemption 50% of Maximum Redemption 75% of Maximum Redemption Maximum Redemption NTBV NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price Assuming Full Exercise of Over-Allotment Option $7.55 $6.96 $3.04 $5.98 $4.02 $4.08 $5.92 $(1.24) $11.24 Assuming No Exercise of Over-Allotment Option $7.52 $6.92 $3.08 $5.94 $4.06 $4.02 $5.98 $(1.32) $11.32 Currently, there is no public market for our units, Class A ordinary shares or warrants. We intend to apply to have our units listed on Nasdaq Global Market, or Nasdaq, under the symbol GPACU. We expect that the Class A ordinary shares and warrants comprising the units will begin separate trading on Nasdaq under the symbols GPAC and GPACW, respectively, on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless the representative of the underwriters permit earlier separate trading and we have satisfied certain conditions. We are an emerging growth company and smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 53 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the U.S. Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. No offer or invitation, whether directly or indirectly, may be made to the public in the Cayman Islands to subscribe for our securities. Per Unit Total Public offering price $10.00 $200,000,000 Underwriting discounts and commissions(1) $0.60 $12,000,000 Proceeds, before expenses, to us $9.40 $188,000,000 (1) Includes $0.20 per unit, or $4,000,000 in the aggregate (or $4,600,000 in the aggregate if the underwriters option to purchase additional units is exercised in full), payable to the underwriters upon the closing of this offering, and $0.40 per share, or $8,000,000 in the aggregate (or $9,200,000 in the aggregate if the underwriters option to purchase additional units is exercised in full) payable to the underwriters for deferred underwriting commissions to be placed in a trust account located in the United States, as described herein, and released to the underwriters only upon the consummation of an initial business combination. See also the section titled Underwriting for a description of compensation payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement units described in this prospectus, $200,000,000, or $230,000,000 if the underwriters over-allotment option is exercised in full ($10.00 per unit in either case), will be deposited into a trust account located in the United States with Continental Stock Transfer & Trust Company acting as trustee. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2025. Sole Book-Running Manager Jefferies Co-Managers Ladenburg Thalmann Northland Capital Markets , 2025 TABLE OF CONTENTS believe our deep industry knowledge, strategic relationships, and hands-on approach to value creation will make us an attractive partner for high-quality businesses seeking to accelerate their growth and access the public capital markets. While we may pursue an initial business combination target in any industry or geographic region, we intend to focus our search on businesses operating within the maritime, logistics, and digital infrastructure sectors. These industries are undergoing significant transformation driven by technological innovation, regulatory evolution, and shifting global trade dynamics. We believe these trends are creating compelling opportunities for companies that are positioned to benefit from increased demand for efficiency, sustainability, and digital enablement. We intend to focus on combining with a business with a strong market position and a clear path to long-term value creation. Our focus will include, but not be limited to, companies operating in the following areas: marine technology, marine services, U.S.-focused marine businesses, marine logistics and distribution, vessel technical management, and data centers. We believe these sectors offer attractive fundamentals, including recurring revenue models, high barriers to entry, and favorable macroeconomic tailwinds. Although we intend to focus our search on the sectors described above, we are not limited to a particular industry or geographic region and may ultimately pursue an initial business combination opportunity in any business or industry. See Risk Factors General Risk Factors Past experience or performance by our management team or their affiliates may not be indicative of future performance of an investment in us. Our Founders, Board of Directors and Management Our team is led by Peter Georgiopoulos, Leonard Vrondissis, and Stewart Crawford, who collectively bring deep operating and investment expertise. Peter Georgiopoulos, our Chairman and Chief Executive Officer, has successfully completed five IPOs on the NYSE and Nasdaq and raised more than $20 billion in equity and debt. Leonard Vrondissis, our President and Director and Co-Founder of United Overseas Group, brings over 25 years of experience in the shipping industry, with a focus on shipping finance, and has successfully completed nearly $9 billion in transactions. Stewart Crawford, our Chief Financial Officer, has a diverse set of experiences as a C-level operating executive, seasoned investor, and accounting professional. We believe our management team and board are well positioned to identify and execute attractive business combination opportunities. Peter C. Georgiopoulos, our Chairman and Chief Executive Officer, is widely recognized for introducing shipping to the American capital markets in the 1990s taking 5 companies public on the NYSE and NASDAQ exchanges. He has helped raise over $20 billion in proceeds across 30 maritime transactions. He has served as Chairman and co-founder of United Overseas Group since March 2021, a vessel owner and operator that operates with a commitment to protecting human health, safety, the environment, and property. He previously served as Chairman and Chief Executive Officer of Gener8 Maritime (formerly NYSE: GNRT) from 2015 to 2018 and Chairman and Founder of Maritime Equity Partners from 2010 to 2016). Prior to that, he served as founder Chairman and Director of Genco Shipping & Trading Limited (NYSE: GNK) and founder Chairman and Chief Executive Officer of General Maritime Corporation from its inception in 1997 to 2015. Mr. Georgiopoulos also served as non-executive Chairman of Aegean Maritime Petroleum (formerly NYSE: ANW). Earlier in his career, he was the principal of Maritime Equity Management LLC, a ship-owning and investment company he founded in 1991 and led until 1997. He also worked as an investment banker at Drexel Burnham Lambert from 1987 to 1990. Prior to entering investment banking, Mr. Georgiopoulos gained experience in the sale, purchase, and chartering of vessels while working for shipowners in New York and Piraeus, Greece Mr. Georgiopoulos also has extensive experience as an investor in various technology companies serving on the Board of JPay, SeaArctos, Payment Works, Quantum HPC and CentaurLab AI. Mr Georgiopoulos holds an M.B.A. from Dartmouth College. Leonard Vrondissis, our President and Director, has over 25 years of experience in the shipping industry, with a particular focus on shipping finance. He has been instrumental taking 3 companies public on the NYSE and TABLE OF CONTENTS NASDAQ exchanges. He is a co-founder of United Overseas Group, a business he started alongside Mr. Georgiopoulos, and currently serves as a Director. Over the course of his career, Mr. Vrondissis has completed approximately $9 billion in transactions across public and private equity, traditional bank financing, and high-yield bonds, and has facilitated over $7 billion in M&A activity. He served as Executive Vice President and Chief Financial Officer of Gener8 Maritime Inc. from 2015 to 2018, and previously held the same roles at General Maritime Corporation from 2013 to 2015. He also served as co founder and Executive Vice President of Maritime Equity Partners from 2010 to 2016 and has been Treasurer of Maritime Equity Management since 2010. Mr. Vrondissis served as Vice President of General Maritime Corporation from 2001 to 2013. He also held the role of Vice President at Genco Shipping & Trading, where he was instrumental in the company s founding and subsequent initial public offering. Earlier in his career, he played a key role in the privatization and financing of Top Glory Shipping in 2004, which was the largest cross-border M&A transaction out of China at the time. In addition to his transportation industry experience Mr. Vrondissis also serves on the Board of various technology companies including SeaArctos, Quantum HPC, and ASETS-CA. Mr. Vrondissis holds a B.S. in Management and Finance from Babson College. Stewart Crawford, our Chief Financial Officer, has served as Chief Financial Officer of United Overseas Group since January 2021, where he is responsible for the finance, treasury, and accounting functions of the business and is actively involved in sourcing, evaluating, and funding investment opportunities in shipping and other sectors. Mr. Crawford has over 20 years in senior positions in accounting and finance functions of both public and private maritime-related entities. Prior to joining United Overseas Group, Mr. Crawford served as Business Development Advisor at Pyxis Tankers (NASDAQCM: PXS), a global maritime transportation company with a focus on tanker and dry bulk sectors. He previously held the role of Chief Financial Officer at Alma Maritime Limited, a maritime investment vehicle with a fleet of tankers and dry bulk assets and at the same time served as Chief Financial Officer of AMCI Poseidon Fund, an investment fund which sourced and invested in distressed shipping assets. Earlier in his career, Mr. Crawford gained experience in multiple industries through his role as an Audit Manager at Ernst & Young and PricewaterhouseCoopers. Mr. Crawford holds a B.Com. in Finance from the University of Edinburgh and is a Chartered Accountant through the Institute of Chartered Accountants of Scotland. Alexandros Argyros has agreed to serve on our board of directors. Mr. Argyros is Managing Director and Head of Investment Banking at AXIA Ventures Group, a leading regional European investment bank, where he leads the firm s advisory and capital markets activities across multiple sectors and geographies with a focus on the transportation industry. He previously spent time at FiliaGroup, a private equity fund focused on the environment and alternative energy sectors. Mr. Argyros has extensive experience in SPACs and maritime finance, having previously served as a Director at Stellar Acquisition III Inc. and Nautilus Marine Acquisition Corp., where he played a key role in strategic transactions and corporate development. Earlier in his career, Mr. Argyros was an investment banker at Morgan Stanley, advising clients on mergers and acquisitions and capital markets transactions. Chele Farley has agreed to serve on our board of directors. Ms. Farley currently serves as a Partner and Managing Director of Mistral Capital International, a middle-market private equity fund that has invested over $1.6 billion since its inception and that she has been a part of since 1995, where she focuses on private equity investments and strategic advisory across a range of sectors. During her tenure at Mistral Capital International, Ms. Farley has completed transactions with Goldman Sachs, Starwood Capital and Royal Dutch Shell. Ms. Farley served as a director of NASDAQ-listed Murphy Canyon Acquisition Corp. from its initial public offering in February 2022 until its merger with NASDAQ-listed Conduit Pharmaceuticals Inc. (now CDT Equity) in September 2023, following which Ms. Farley continues to serve as a Director and also serves as Chair of the Audit Committee of CDT Equity. She is also a member of the Board of Directors of the WordPress Foundation, which supports open-source initiatives and digital literacy worldwide, and a member of the Board of Directors of Palmilla San Jose Inmobiliara, a real estate resort development in Cabo San Lucas. Earlier in her career, Ms. Farley held merchant banking and investment banking roles at UBS Capital and Goldman Sachs, where she advised on capital markets transactions and mergers and acquisitions. Ms. Farley graduated from Stanford University with a B.S. and M.S. in Industrial Engineering. TABLE OF CONTENTS Warren Hosseinion has agreed to serve on our board of directors. Dr. Hosseinion was a co-founder in 2001 of Apollo Medical Holdings, Inc. (NASDAQ: ASTH) (which changed its name on February 26, 2024 to Astrana Health, Inc.), was a member of its board of directors from July 2008 to March 2019 and served as its Chief Executive Officer from July 2008 to December 2017 and Co-Chief Executive Officer from December 2017 to March 2019. Dr. Hosseinion is also the Chairman of the Board of Voyager Acquisition Corp (NASDAQ: VACH) since August 2024. Dr. Hosseinion was Chairman of the Board of directors of Clinigence Holdings, Inc. from April 2019 to March 2022, Chief Executive Officer of Clinigence Holdings, Inc. from March 2021 to March 2022, and following a business combination with Nutex Health, Inc. he continues to be a director and President of Nutex Health, Inc. (NASDAQ: NUTX) from April 2022 to present. Dr. Hosseinion has also served as Chairman of the Board of Cardio Diagnostics Holdings, Inc. (NASDAQ: CDIO) since October 2022. He has also served as Chairman of the Board of Altitude Acquisition Corporation (NASDAQ: ALTU) since September 2022. Dr. Hosseinion received his B.S. in Biology from the University of San Francisco, his M.S. in Physiology and Biophysics from the Georgetown University Graduate School of Arts and Sciences and his medical degree from the Georgetown University School of Medicine. He completed his internship and residency in Internal Medicine at the University of Southern California Medical Center. Jonathan Intrater has agreed to serve on our board of directors. Mr. Intrater is a Managing Director in the Investment Banking division of Ladenburg Thalmann, an investment bank that has been an underwriter and advisor of numerous SPAC transactions. His broad transactional experience encompasses public equity and high-yield note offerings, private placements of debt and equity securities, merger advisory transactions, and various debt restructuring assignments. Mr. Intrater has significant SPAC experience, having served as a director or executive of three SPACs which have announced or closed business combinations, to include Voyager Acquisition Corp, Mana Capital Acquisition Corp and GreenVision Acquisition Corp. Prior to joining Ladenburg Thalmann, he served as a Head of Telecom Investment Banking and Managing Director at Brenner Securities Corporation, where he executed numerous transactions for both privately-held and public clients. Earlier in his career, Mr. Intrater served as Senior Vice President at BIA, Frazier, Gross & Kadlec, a telecommunications valuations firm. Mr. Intrater holds an M.B.A. from Vanderbilt University and a B.A. from the University of Pennsylvania. We believe our management team and board of directors is well positioned to take advantage of the growing set of investment opportunities focused on the maritime, logistics, and digital infrastructure sectors and that our contacts and relationships will allow us to generate an attractive transaction for our shareholders. With respect to the above, past experience or performance of our management team and their affiliates is not a guarantee of either (i) success with respect to a business combination that may be consummated or (ii) the ability to successfully identify and execute a transaction. You should not rely on the historical record of management and their affiliates as indicative of future performance. See Risk Factors General Risk Factors Past experience or performance by our management team or their affiliates may not be indicative of future performance of an investment in us. For a list of our officers and directors and entities for which a conflict of interest may or does exist between such officers and directors, on the one hand, and us, on the other hand, please refer to Management Conflicts of Interest. Certain of our founders, officers and directors presently have, and any of them in the future may have additional, fiduciary and contractual duties to other entities. As a result, if any of our founders, officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he, she or it has then-current fiduciary or contractual obligations, then, he, she or it may be required to honor such fiduciary or contractual obligations to present such business combination opportunity to such entity. However, we do not expect these duties to present a significant conflict of interest with our search for an initial business combination. We believe this conflict of interest will be naturally mitigated, to some extent, by the types of acquisitions we expect General Purpose Acquisition Corp. to find most attractive. In addition to the above, our officers and directors are not required to commit any specific amount of time to our affairs, and accordingly will have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. TABLE OF CONTENTS Market Opportunity While we may pursue an initial business combination in any industry, we intend to focus on combining with a leading business operating in one of seven broadly defined market areas: (i) marine technology, (ii) marine services, (iii) U.S.-focused marine businesses, (iv) marine distribution, (v) marine logistics, (vi) vessel technical managers, and (vii) data centers. The GPAC team has significant experience in maritime and technology investments and is thus advantageously positioned to execute on a transaction within them. Marine technology The marine technology sector encompasses a rapidly evolving ecosystem of companies that are driving digital transformation across the global maritime industry. This sector integrates advanced software platforms, data analytics, automation, and artificial intelligence to optimize vessel operations, enhance safety protocols, ensure regulatory compliance, and promote environmental sustainability. Key areas of innovation include real-time fleet monitoring, predictive maintenance, autonomous navigation systems, and emissions tracking, among others. As the maritime industry faces increasing pressure to modernize and decarbonize, we believe marine technology companies are well-positioned to deliver scalable solutions that address these challenges for a significant market. We intend to target businesses with differentiated technology offerings, strong intellectual property portfolios, and the potential to become category-defining platforms in a traditionally under-digitized industry. Marine services Marine services represent a broad and essential segment of the maritime economy, encompassing a wide range of specialized service providers that support vessel operations, port infrastructure, and regulatory compliance. This includes companies engaged in Testing, Inspection, and Certification (TIC), port and terminal operations, Maintenance, Repair, and Overhaul (MRO), vessel cleaning, engineering and consulting services, and ship brokerage, among others. These businesses typically benefit from recurring revenue models, long-term customer relationships, and high barriers to entry due to regulatory complexity and operational specialization. We believe the sector offers attractive consolidation opportunities and operational efficiencies, particularly as maritime operators increasingly outsource non-core functions to focus on strategic growth and fleet optimization. U.S.-focused marine businesses The U.S. marine industry encompasses a broad array of strategically vital businesses, including Jones Act fleets, U.S.-flag vessels, and domestic shipbuilding and repair operations. Jones Act fleets operate in a protected segment of the domestic maritime market and are experiencing renewed strategic importance due to national security considerations, supply chain resilience initiatives, and constrained new vessel supply. Beyond Jones Act operations, U.S.-flag fleets engaged in international trade and government contracting (e.g., Military Sealift Command and Maritime Security Program) also benefit from regulatory support and long-term charter opportunities. Meanwhile, U.S. shipyards are seeing increased demand for new vessel construction, fleet upgrades, and maintenance services, driven by aging assets and evolving environmental and safety standards, as well as their increasing criticality in maintaining and modernizing the nation s maritime infrastructure. We believe the broader U.S. marine industry is poised for long-term growth, supported by favorable regulatory tailwinds, increased federal and private investment, and a strategic shift toward domestic sourcing and logistics. Target companies in this space may benefit from growing demand, limited competition, and opportunities to modernize aging fleets and facilities through capital investment, digital transformation, and operational upgrades. Marine distribution Marine distribution businesses serve as critical supply chain enablers for the maritime industry, offering a comprehensive range of products including chemicals, specialty consumables, lubricants, and technical equipment necessary for vessel operations. These companies typically operate with global reach and deep product portfolios, supporting commercial as well as government maritime customers. The sector benefits from high customer retention, logistical expertise, and the ability to scale across geographies. As maritime operations become more TABLE OF CONTENTS complex and globalized, the need for reliable, responsive distribution partners continues to grow. We believe this sector offers compelling opportunities for platform-building, margin enhancement, and digital transformation through integrated supply chain solutions. Marine logistics Marine logistics encompasses the transportation, warehousing, and coordination of goods between vessels, ports, and inland logistics providers. This sector plays a vital role in enabling the seamless movement of cargo across global supply chains, ensuring timely delivery and efficient handling of goods. Companies in this space offer services such as freight forwarding, customs brokerage, and inventory management. With increasing pressure on global logistics networks and rising demand for integrated supply chain solutions, marine logistics providers are well-positioned to capitalize on trends in automation, digitization, and sustainability. We intend to target businesses with scalable operations, strong customer relationships, and the ability to deliver differentiated logistics solutions in a fragmented market. Vessel technical managers Vessel technical management involves the comprehensive oversight of a ship s operational integrity, including maintenance planning, repair execution, safety management, and regulatory compliance. These services are essential to ensuring vessel reliability, minimizing downtime, and adhering to international maritime standards. Technical managers often operate under long-term contracts and maintain close relationships with ship owners, charterers, and classification societies. As regulatory frameworks become more stringent and vessels more technologically advanced, the role of technical managers becomes increasingly critical in safeguarding asset performance and operational excellence. We believe this sector offers attractive opportunities for growth through service expansion, digital integration, and strategic partnerships. Data centers Data centers are foundational to the digital economy, particularly as demand for artificial intelligence workloads accelerates. These facilities are engineered to support high-density, GPU-intensive computing environments required for training and deploying advanced AI models. With long-term contractual revenue streams, significant capital barriers to entry, and strategic importance to hyperscalers and enterprise clients, AI data centers represent a compelling investment opportunity. Their relevance extends beyond technology, underpinning innovation across industries including healthcare, finance, logistics, and energy. We intend to target data center platforms with scalable infrastructure, strong tenant relationships, and the ability to support next-generation compute environments in a rapidly evolving digital landscape. Experience with Special Purpose Acquisition Companies ( SPACs ) Certain members of our management team and board of directors have previous experience in the execution of public acquisition vehicles. Alexandros Argyros, Director nominee, brings direct SPAC experience through his prior roles as a Director at Stellar Acquisition III Inc. and Nautilus Marine Acquisition Corp., where he contributed to sourcing of strategic transactions and corporate development. He was also a founding member of ITHAX Acquisition Corp, a SPAC which completed a business combination successfully. As Managing Director and Head of Investment Banking at AXIA Ventures Group, Mr. Argyros has led capital markets and advisory efforts with a focus on transportation, with SPAC transaction credentials. Jonathan Intrater, Director nominee, has served as a director or executive of three SPACs Voyager Acquisition Corp, Mana Capital Acquisition Corp, and GreenVision Acquisition Corp each of which has announced or completed a business combination. As Managing Director at Ladenburg Thalmann, Mr. Intrater has advised on numerous SPAC transactions, including public equity offerings, PIPEs, and merger advisory assignments. TABLE OF CONTENTS We believe our management and board of director s capabilities and experience will complement the Company and demonstrate the team s resources required to effect a successful business combination in the current market conditions. In addition, we are well positioned to source additional funding in the capital markets, as required. The Company will be a natural extension of our management s day-to-day business and benefit from the proprietary deal flow the team sources, both internally and externally, from our management s and board of director s breadth of industry relationships. Our founders and our directors and officers expect in the future to become affiliated with other public SPACs that may have acquisition objectives that are similar to ours. See Risk Factors Risks Relating to our Sponsor and Management Team Our officers and directors presently have, and any of them in the future may have additional, fiduciary or contractual obligations to other entities, including another blank check company, and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented. The past experience or performance of the members of our management team or their affiliates is not a guarantee that we will be able to identify a suitable candidate for our initial business combination or of success with respect to any business combination we may consummate. You should not rely on the historical record or the performance of our management team or their affiliates as indicative of our future performance. See Risk Factors General Risk Factors Past experience or performance by our management team or their affiliates may not be indicative of future performance of an investment in us. Business Strategy We expect that relationships cultivated from years of transaction experience with management teams of public and private companies, investment bankers, restructuring advisers, attorneys and accountants will provide potential opportunities for our company. Our goal is to collaborate with a company that already is a fundamentally healthy company. We will seek to work with a potential acquisition candidate to access the capital markets, retain and attract top tier management talent, and execute a proprietary value-creation business plan helping the company continue to grow into the next phase of its life cycle. We intend to employ a fundamental, value-oriented acquisition framework that seeks a target with the potential for significant equity value creation coupled with strong downside protection from dependable cash flows and a durable business franchise. The management team along with our board of directors have experience in: Operating companies in the public and private markets, defining corporate strategy, and identifying, mentoring and recruiting top talent; Growing companies, both organically and through strategic transactions, expanding product portfolios and broadening geographic footprints; Sourcing, structuring, acquiring and selling businesses; Accessing public and private capital markets to optimize capital structure, including financing businesses and helping companies transition ownership structures; Fostering relationships with sellers, capital providers and experienced target management teams; and Building companies with resilient and flexible business models that have had success in navigating multiple periods of economic drawdowns. Following the completion of this offering, we will communicate with our management s network of deal sourcing relationships to articulate the parameters for our search for a potential business combination and begin the process of pursuing and reviewing potential opportunities. TABLE OF CONTENTS Acquisition Criteria Consistent with our strategy, we have identified the following general criteria and guidelines which we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet these criteria and guidelines. We intend to acquire one or more businesses that we believe: Will benefit from a public currency. Access to the public equity markets could allow the target company to utilize an additional form of capital, enhancing its ability to pursue accretive acquisitions, high-return capital projects, and/or strengthen its balance sheet; Has a healthy growing platform. We will seek to invest in companies that we believe possess attractive business models that will provide a growing platform for equity investors; Has a management team and/or a strong sponsor that desires a significant equity stake in the post-business combination company. We will seek to partner with a management team and/or seller who is well-incentivized and aligned in an effort to create shareholder value; Can be acquired at an attractive valuation for public market investors. We will seek to be a disciplined steward of capital that will invest on terms that we believe provide attractive risk-adjusted returns. We intend to focus on target companies with an approximate enterprise of $600 million to 1.8 billion; Will be resilient to economic cycles. We will focus on recession-resilient business models; and Are commercial stage assets that have an attractive cash flow profile and/or unit economics. We will seek to target businesses with attractive financial attributes. These criteria are not intended to be exhaustive. We may use other criteria as well. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC. Our Acquisition Process In evaluating a prospective target business, we expect to conduct a thorough due diligence review which will encompass, among other things, meetings with incumbent management and employees, document reviews, inspection of facilities, as well as a review of financial, operational, legal and other information which will be made available to us. We will also utilize our operational and capital planning experience. As described in more details below under Other Consideration and Conflicts of Interest and in the section entitled Management Conflicts of Interest, we are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors and conflicts of interest may arise if we select a business combination target that is affiliated with our sponsor, officer or directors. In the event we seek to complete our initial business combination with a company that is affiliated with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion that the consideration to be paid by us in our initial business combination is fair to our company from a financial point of view from either an independent investment banking firm or an independent valuation or accounting firm. We are not required to obtain such an opinion in any other context. Despite our agreement to obtain an opinion from an independent investment banking firm or an independent valuation or accounting firm regarding the fairness to our company from a financial point of view of a business combination with one or more target businesses affiliated with our sponsor, officers or directors, potential conflicts of interest still may exist and, as a result, the terms of the business combination may not be as advantageous to our public shareholders as they would be absent any conflicts of interest. Such conflicts of interest in connection with a business combination with a business affiliated with our sponsor, officers or directors include TABLE OF CONTENTS conflicts related to the additional fiduciary and contractual duties that our directors and officers may have (as further described in the next paragraph) and conflicts resulting from our directors and officers indirect ownership in the founder shares and private placement units held by our sponsor and the effective price at which such securities were purchased by the sponsor and which may result in the selection of an acquisition target that subsequently declines in value and is unprofitable for public shareholders (while still profitable from our sponsor s, directors and officers perspective) instead of not consummating a business combination at all or with a different business combination target (for more information, also see Other Consideration and Conflicts of Interest ). Our founders, officers and directors presently have, and any of them in the future may have additional, fiduciary and contractual duties to other entities, including without limitation, any future SPACs they may be involved in. As a result, if any of our founders, officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he, she or it has then-current fiduciary or contractual obligations (including, without limitation, any future SPACs they may be involved in), he or she may need to honor such fiduciary or contractual obligations to present such business combination opportunity to such entity. If these entities decide to pursue any such opportunity, we may be precluded from pursuing the same. Further, members of our management team will directly or indirectly own our ordinary shares and/or private placement units (including their underlying securities) following this offering, and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. The low price that our sponsor, officers and directors (directly or indirectly) paid for the founder shares creates an incentive whereby our officers and directors could potentially make a substantial profit even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. Although affiliates of our directors and officers or entities, to which they have fiduciary obligations, may pursue a similar target universe to us for acquisition or investment opportunities, we anticipate that the specific companies or assets that we may target (e.g. companies in the maritime, logistics, and digital infrastructure sectors seeking to go public) will only overlap as appropriate opportunities for such entities and persons due to their investment mandates if such potential targets also desire to enter into other debt or equity transactions with such entities and persons in connection with a going public transaction, which our potential targets may choose to effectuate via a business combination with us or without us via a business combination with a competing SPAC or the use of a more traditional initial public offering or direct listing structure. Therefore, we do not expect the fiduciary and contractual duties of our directors, officers, their affiliates and entities, to which they have fiduciary obligations, to materially affect our ability to select an appropriate acquisition target and complete an initial business combination. Initial Business Combination We must complete one or more business combinations that together have an aggregate fair market value of at least 80% of the net assets held in the trust account (excluding the amount of deferred underwriting discounts held in trust and taxes payable on the interest earned on the trust account) at the time of signing the agreement to enter into the initial business combination. If our board of directors is not able to independently determine the fair market value of the target business or businesses or we are considering an initial business combination with an affiliated entity, we will obtain an opinion from an independent investment banking firm or an independent valuation or accounting firm with respect to the satisfaction of such criteria. Our shareholders may not be provided with a copy of such opinion nor will they be able to rely on such opinion. While we consider it unlikely that our board will not be able to make an independent determination of the fair market value of a target business or businesses, it may be unable to do so if the board is less familiar or experienced with the target company s business, there is a significant amount of uncertainty as to the value of the company s assets or prospects, including if such company is at an early stage of development, operations or growth, or if the anticipated transaction involves a complex financial analysis or other specialized skills and the board determines that outside expertise would be helpful or necessary in conducting such analysis. Since any opinion, if obtained, would merely state that the fair market value of the target business meets the 80% of net assets threshold, unless such opinion includes material information regarding the valuation of a target business or the consideration to be provided, it is not anticipated that copies of such opinion would be distributed to our shareholders. However, if required under applicable law, any proxy statement that we deliver to shareholders and file with the SEC in connection with a proposed transaction will include such opinion. TABLE OF CONTENTS We anticipate structuring our initial business combination so that the post-business combination company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-business combination company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-business combination company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended, or the Investment Company Act. Even if the post-business combination company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-business combination company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to the completion of our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-business combination company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses and we will treat the target businesses together as the initial business combination for purposes of a tender offer or for seeking shareholder approval, as applicable. To the extent we effect our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, we may be affected by numerous risks inherent in such company or business. Although our management will endeavor to evaluate the risks inherent in a particular target business, we cannot assure you that we will properly ascertain or assess all significant risk factors. The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the funds we can use to complete another business combination. Further, as the number of SPACs evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets. Because of our limited resources and such increased competition for business combination opportunities, including from other SPACs or other entities having a similar business objective to us, it may be more difficult for us to complete our initial business combination or negotiate attractive terms for our initial business combination. Depending on who our competitors will be when negotiating a business combination transaction, we may also be at a competitive disadvantage in successfully negotiating an initial business combination. For more information also see Risk Factors Risks Relating to our Search for, and Consummation of, or Inability to Consummate, a Business Combination As the number of SPACs evaluating targets increases, attractive targets may become scarcer and there may be more competition for attractive targets. This could increase the cost of our initial business combination and could even result in our inability to find a target or to consummate an initial business combination and Risk Factors Risks Relating to our Search for, and Consummation of, or Inability to Consummate, a Business Combination Because of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination. If we do not complete our initial business combination within the required time period, our public shareholders may receive only approximately $10.00 per public share, or less in certain circumstances, on the liquidation of our trust account and our warrants will expire worthless. Pursuant to a letter agreement to be entered with us, we have agreed not to enter into a definitive agreement regarding an initial business combination without the prior consent of our sponsor. Further, pursuant to such letter agreement, each of our sponsor, directors and officers and the underwriters have agreed to restrictions on its, his or TABLE OF CONTENTS her ability to transfer, assign, or sell founder shares, private placement units and public units (if any are purchased in connection with the offering), as summarized in the table below. For more information on non-contractual resale restrictions, also see Securities Eligible for Future Sale Rule 144, Securities Eligible for Future Sale Restrictions on the Use of Rule 144 by Shell Companies or Former Shell Companies and Securities Eligible for Future Sale Summary of resale restrictions. Subject securities Transfer restrictions Natural persons and entities subject to transfer restrictions Exceptions to transfer restrictions Founder Shares Agreement not to (a) sell, offer to sell, contract or agree to sell, hypothecate, pledge, grant any option to purchase or otherwise dispose of or agree to dispose of, directly or indirectly, or establish or increase a put equivalent position or liquidation with respect to or decrease a call equivalent position within the meaning of Section 16 of the Exchange Act and the rules and regulations of the SEC promulgated thereunder with respect to, any security, (b) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any security, whether any such transaction is to be settled by delivery of such securities, in cash or otherwise, or (c) publicly announce any intention to effect any transaction specified in clause (a) or (b) (each of the foregoing, a Transfer ), until the earlier of (A) one year following the completion of our initial business combination and (B) subsequent to the completion of our initial business combination, the date on which we complete a liquidation, merger, share exchange, reorganization or other similar transaction that results in all of our public shareholders having the right to exchange their ordinary shares for cash, securities or other property. Notwithstanding the foregoing, if the last sale price of the Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days Our sponsor, directors and officers Restrictions are not applicable to transfers (a) to our officers or directors, any affiliates or family members of any of our officers or directors, any members or partners of our sponsor or their affiliates, any affiliates of our sponsor, or any employees of such affiliates; (b) in the case of an individual, by gift to a member of one of the individual s immediate family or to a trust, the beneficiary of which is a member of the individual s immediate family, an affiliate of such person or to a charitable organization; (c) in the case of an individual, by virtue of laws of descent and distribution upon death of the individual; (d) in the case of an individual, pursuant to a qualified domestic relations order; (e) by private sales or transfers made in connection with the consummation of a business combination at prices no greater than the price at which the founder shares, private placement units, private placement warrants, private placement shares or Class A ordinary shares, as applicable, were originally purchased; (f) pro rata distributions from our sponsor to its members, partners, or shareholders pursuant to our sponsor s operating agreement, (g) by virtue of our sponsor s organizational documents upon liquidation or dissolution of our sponsor; (h) to the Company for no value for cancellation in connection with the consummation of our initial business combination; (i) in the event of our liquidation prior to the completion of our initial business TABLE OF CONTENTS Subject securities Transfer restrictions Natural persons and entities subject to transfer restrictions Exceptions to transfer restrictions within any 30-trading day period commencing at least 180 days after the completion of our initial business combination, the founder shares will be released from the lock-up. Further, no Transfer of any Class A ordinary shares, Class B ordinary shares or any other securities convertible into, or exercisable or exchangeable for, ordinary shares until 180 days after the date of this prospectus. combination; or (j) in the event of our completion of a liquidation, merger, share exchange or other similar transaction which results in all of our public shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property subsequent to our completion of our initial business combination; provided, however, that in the case of clauses (a) through (g) these permitted transferees must enter into a written agreement agreeing to be bound by these transfer restrictions and the other restrictions contained in the letter agreement. Any permitted transferees would be subject to the same restrictions and other agreements of our sponsor and management team with respect to any founder shares and private placement units (including their underlying securities). Further, despite the 180 day Transfer restriction after the date of this prospectus that is described under the column Transfer restrictions to the left of this column, the underwriting agreement authorizes registration with the SEC pursuant to the Registration Rights and Shareholder Rights Agreement of the resale of the founder shares, the private placement units (including any private placement units issued upon conversion of working capital loans) and their underlying securities, the exercise of the private placement warrants and the public warrants and the Class A ordinary shares issuable upon exercise of such warrants or conversion of founder shares. Private Placement Units and underlying securities No Transfer until 30 days after the completion of our initial business combination. Further, no Transfer of any Class A ordinary shares, Class B Our sponsor, directors and officers and the Same as above. TABLE OF CONTENTS Subject securities Transfer restrictions Natural persons and entities subject to transfer restrictions Exceptions to transfer restrictions ordinary shares or any other securities convertible into, or exercisable or exchangeable for, ordinary shares until 180 days after the date of this prospectus. underwriters
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diff --git a/parsed_sections/prospectus_summary/2025/CIK0002090452_fg_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CIK0002090452_fg_prospectus_summary.txt
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+Investing in our securities involves a high degree of risk. See Summary The Offering Founder Shares, Summary The Offering Private units and underlying securities, Summary The Offering $15 Exercise Price Warrants, Risk Factors and Certain Relationships and Related Party Transactions . Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Without With Over-allotment Over-allotment Per Share Option Option Initial public offering price $ 10.00 $ 200,000,000 $ 230,000,000 Underwriting discounts and commissions(1) $ 0.45 $ 8,000,000 $ 9,200,000 Proceeds to us, before expenses $ 9.55 $ 192,000,000 $ 220,800,000 1)The underwriter will be entitled to an underwriting discount, payable upon the closing of this offering, equal to the lesser of (i) 1.0% of the gross proceeds of this offering and (ii) an amount equal to $1,000,000, plus, if applicable, 0.5% of the gross proceeds from the sale of the over-allotment unit. In addition, $0.35 per unit, or $7,000,000 (or up to $8,050,000 if the underwriters over-allotment option is exercised in full) in the aggregate, will be paid to the underwriters upon consummation of an initial business combination from the funds held in the trust account (which amounts shall be subject to pro-rata reduction based on the number of Class A ordinary shares redeemed by our public shareholders provided that such amounts shall not be less than $2,000,000) will be placed in a trust account located in the United States as described herein. In addition to the cash compensation set forth herein, we have agreed to issue to the underwriters units equaling 1.0% of the units sold in this offering, or 200,000 units, or up to 230,000 units (the Underwriter Units ) if the underwriters over-allotment option is exercised in full, each consisting of one ordinary share and one-half of one warrant to purchase one ordinary share at an exercise price of $11.50 per share by exercising a whole private warrant, in a private placement to be completed concurrently with the consummation of this offering. Except with respect to certain registration rights and transfer restrictions, the Underwriter Units will be identical to the public units sold in this offering. See also Underwriting for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement securities described in this prospectus, $200,000,000, or $230,000,000 if the underwriters over-allotment option is exercised in full (approximately $10.00 per unit in each case), will be deposited into a trust account in the United States with Odyssey Transfer and Trust Company acting as trustee, after deducting $1,000,000 (plus, if applicable, 0.5% of the gross proceeds from the sale of the over-allotment unit) in underwriting commissions payable upon the closing of this offering and an aggregate of $842,500 (regardless of whether the over-allotment option is exercised) to pay fees and expenses in connection with the closing of this offering and for working capital following the closing of this offering. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2025. ThinkEquity EarlyBirdCapital, Inc. The date of this prospectus is , 2025 Table of Contents Table of Contents Summary 1
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+Prospectus Summary 1
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+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2025/CLDWW_calidi_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CLDWW_calidi_prospectus_summary.txt
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+164 CALIDI BIOTHERAPEUTICS, INC. INDEX TO FINANCIAL STATEMENTS Condensed Consolidated Balance Sheets F-2 Condensed Consolidated Statements of Operations F-3 Condensed Consolidated Statements of Changes in Total Equity F-5 Condensed Consolidated Statements of Cash Flows F-6 Notes to Condensed Consolidated Financial Statements F-7 Page Report of Independent Registered Public Accounting Firm (PCAOB ID 688) F-35 Consolidated Balance Sheets F-36 Consolidated Statements of Operations F-37 Consolidated Statements of Convertible Preferred Stock and Total Equity (Deficit) F-39 Consolidated Statements of Cash Flows F-41 Notes to the Consolidated Financial Statements F-42 F-1 CALIDI BIOTHERAPEUTICS, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands except for par value data) June 30, 2025 December 31, 2024 (Unaudited) ASSETS CURRENT ASSETS Cash $5,279 $9,591 Prepaid expenses and other current assets 770 636 Total current assets 6,049 10,227 NONCURRENT ASSETS Machinery and equipment, net 929 869 Operating lease right-of-use assets, net 2,333 2,934 Other noncurrent assets 40 152 TOTAL ASSETS $9,351 $14,182 LIABILITIES AND TOTAL EQUITY CURRENT LIABILITIES Accounts payable $1,215 $2,072 Related party accounts payable 12 2 Accrued expenses and other current liabilities 1,493 1,858 Related party accrued expenses and other current liabilities 441 480 Term notes payable, net of discount, including accrued interest 251 Related party term notes payable, net of discount, including accrued interest 775 2,702 Related party bridge loan payable, including accrued interest 223 Related party other current liability 638 Finance lease liability, current 113 66 Operating lease right-of-use liability, current 1,304 1,204 Total current liabilities 5,353 9,496 NONCURRENT LIABILITIES Operating lease right-of-use liability, noncurrent 993 1,845 Finance lease liability, noncurrent 226 145 Promissory note 600 600 Related party term notes payable, net of discount, including accrued interest Other noncurrent liabilities Warrant liability 96 119 Related party warrant liability 7 9 TOTAL LIABILITIES 7,275 12,214 Commitments and contingencies (Note 11) - - TOTAL EQUITY Common stock, $0.0001 par value, 330,000 shares authorized; 2,877 and 1,730 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively Additional paid-in capital 134,193 123,277 Accumulated other comprehensive income loss, net of tax (13) (28) Accumulated deficit (132,416) (121,715) Total stockholders equity 1,764 1,534 Noncontrolling interest 312 434 Total equity 2,076 1,968 TOTAL LIABILITIES AND TOTAL EQUITY $9,351 $14,182 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. F-2 CALIDI BIOTHERAPEUTICS, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) 2025 2024 2025 2024 Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (Unaudited) OPERATING EXPENSES Research and development $(2,593) $(2,167) $(5,018) $(4,910) General and administrative (3,071) (3,605) (5,708) (7,614) Total operating expense (5,664) (5,772) (10,726) (12,524) Loss from operations (5,664) (5,772) (10,726) (12,524) OTHER INCOME (EXPENSES), NET Interest expense (29) (108) (63) (206) Interest expense related party (23) (165) (61) (320) Interest expense (23) (165) (61) (320) Series B convertible preferred stock financing costs related party Change in fair value of other liabilities and derivatives (18) 86 14 (112) Change in fair value of other liabilities and derivatives related party (1) 9 2 8 Change in fair value of debt, other liabilities, and derivatives (1) 9 2 8 Grant income 181 50 181 Debt extinguishment Other income (expense), net (22) 10 (32) (7) Total other income (expenses), net (93) 13 (90) (456) LOSS BEFORE INCOME TAXES (5,757) (5,759) (10,816) (12,980) Income tax provision (4) (8) (7) (12) NET LOSS $(5,761) $(5,767) $(10,823) $(12,992) Net loss attributable to noncontrolling interest (46) (122) NET LOSS ATTRIBUTABLE TO CONTROLLING INTEREST (5,715) (5,767) (10,701) (12,992) Deemed dividend on warrants (1,671) (1,671) NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS $(5,715) $(7,438) $(10,701) $(14,663) Net loss per share; basic and diluted $(1.99) $(16.75) $(4.17) $(39.61) Weighted average common shares outstanding; basic and diluted 2,877 444 2,569 370 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. F-3 CALIDI BIOTHERAPEUTICS, INC. CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (In thousands) 2025 2024 2025 2024 Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 (Unaudited) NET LOSS $(5,761) $(5,767) $(10,823) $(12,992) Other comprehensive income (expense), net of tax: Foreign currency translation adjustment 13 (38) 15 20 COMPREHENSIVE LOSS $(5,748) $(5,805) $(10,808) $(12,972) Comprehensive loss attributable to noncontrolling interest (46) (122) COMPREHENSIVE LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS $(5,702) $(5,805) $(10,686) $(12,972) The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. F-4 CALIDI BIOTHERAPEUTICS, INC. CONDENSED CONSOLIDATED STATEMENTS OF TOTAL EQUITY (Unaudited) (In thousands, except share amounts) Shares Amount Capital Income (Loss) Deficit Equity Interest Equity Common Stock Additional Paid-in Accumulated Other Comprehensive Accumulated Total Stockholders Non controlling Total Shares Amount Capital Income (Loss) Deficit Equity Interest Equity Balance at December 31, 2024 1,730,051 $ $123,277 $(28) $(121,715) $1,534 $434 $1,968 Issuance of common stock through At the Market Offering 223,583 2,754 2,754 2,754 Issuance of common stock and warrants through January Confidentially Marketed Public Offering, net of financing costs 416,667 3,607 3,607 3,607 Issuance of common stock and warrants for March Registered Direct Offering and Concurrent Private Placement, net of financing costs 277,084 3,423 3,423 3,423 Restricted stock unit shares released 2,038 Stock-based compensation 607 607 607 Foreign currency translation adjustments 2 2 2 Net loss (4,986) (4,986) (76) (5,062) Balance at March 31, 2025 2,649,423 $ $133,668 $(26) $(126,701) $6,941 $358 $7,299 Exercise of pre-funded warrants 227,334 3 3 3 Stock-based compensation 522 522 522 Foreign currency translation adjustments 13 13 13 Net loss (5,715) (5,715) (46) (5,761) Balance at June 30, 2025 2,876,757 134,193 (13) (132,416) 1,764 312 2,076 Common Stock Additional Paid-in Accumulated Other Comprehensive Accumulated Total Stockholders Non controlling Total Shares Amount Capital Income (Loss) Deficit Equity Interest Equity Balance at December 31, 2023 296,019 $ $91,384 $(47) $(99,572) $ (8,235) $ $(8,235) Issuance of common stock in lieu of cash for services 417 29 29 29 Issuance of common stock in lieu of cash for SEPA commitment fee 1,157 81 81 81 Issuance of common stock to Calidi stockholders as result of Merger 132 Issuance of warrants for legal settlement 158 158 158 Financing fees (327) (327) (327) Stock-based compensation 888 888 888 Foreign currency translation adjustments 58 58 58 Net loss (7,225) (7,225) (7,225) Balance at March 31, 2024 297,725 $ $92,213 $11 $(106,797) $(14,573) $ $(14,573) Balance 297,725 $ $92,213 $11 $(106,797) $(14,573) $ $(14,573) Issuance of common shares and pre-funded warrants through April Public Offering, net of financing costs 110,271 4,822 4,822 4,822 Issuance of common stock per Convertible Note conversion 21,408 1,028 1,028 1,028 Issuance of common shares through May Inducement Offer, net of financing costs 89,151 1,818 1,818 1,818 Exercise of common stock warrants 4,167 100 100 100 Exercise of common pre-funded warrants 16,375 2 2 2 Issuance of RSUs for deferred compensation settlement 105 105 105 Stock-based compensation 751 751 751 Foreign currency translation adjustments (38) (38) (38) Net loss (5,767) (5,767) (5,767) Balance at June 30, 2024 539,097 $ $100,839 $(27) $(112,564) $(11,752) (11,752) Balance 539,097 $ $100,839 $(27) $(112,564) $(11,752) (11,752) F-5 CALIDI BIOTHERAPEUTICS, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) 2025 2024 Six Months Ended June 30, 2025 2024 (Unaudited) CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $(10,823) $(12,992) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation and amortization expense 801 752 Amortization of right of use assets Amortization of debt discount and financing costs 32 Stock-based compensation 1,129 1,639 Change in fair value of debt, other liabilities and derivatives (16) 104 Series B convertible preferred stock financing costs Debt extinguishment Disposal of fixed assets Changes in operating assets and liabilities: Prepaid expenses and other current assets (156) 1,582 Accounts payable (733) 1,142 Accrued expenses and other current liabilities (1,449) (1,095) Other noncurrent liabilities Operating lease right of use liability (764) (489) Net cash used in operating activities (12,011) (9,325) CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of machinery and equipment (64) (5) Cash assumed in connection with the FLAG Merger Security deposits, net Net cash used in investing activities (64) (5) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from public offerings 6,573 5,406 Proceeds from issuance of noncontrolling interest in Nova Cell Proceeds from Registered Direct Offering 3,503 Proceeds from exercise of pre-funded warrants 3 2 Proceeds from exercise of stock options Repayment of principal on related party term notes payable (1,625) Payment of financing costs (381) (781) Repayment of principal on term notes payable (200) (300) Repayment of principal on related party bridge loan payable (200) Repayment of financing lease obligations (34) (45) Proceeds from warrant inducement financing 2,140 Proceeds from exercise of common stock warrants 100 Proceeds from issuance of Series B convertible preferred stock Related party proceeds from issuance of Series B convertible preferred stock Proceeds from Non-Redemption and PIPE Agreements Proceeds from simple agreements for future equity (SAFE) Proceeds from issuance of term notes payable Related party proceeds from issuance of term notes payable Related party proceeds from issuance of loan payable 200 Proceeds from issuance of convertible notes payable 3,000 Related party proceeds from issuance of bridge loans Proceeds from issuance of promissory note Proceeds from issuance of common shares and warrants per subscription agreement Repayment of convertible note payable (1,500) Repayment of principal on related party term notes payable Repayment of principal on term notes payable Payment of debt issuance costs (9) Net cash provided by financing activities 7,639 8,213 Effect of exchange rate changes on cash 6 4 NET DECREASE IN CASH AND RESTRICTED CASH (4,430) (1,113) CASH AND RESTRICTED CASH BALANCE: At beginning of the period 9,809 2,167 At end of the period $5,379 $1,054 SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION Cash paid for interest $837 $116 Cash paid for income taxes $7 $6 SUPPLEMENTAL SCHEDULE OF NONCASH FINANCING AND INVESTING ACTIVITIES Issuance of common stock per convertible note conversion Related party issuance of common stock in lieu of cash for services Issuance of common stock and warrants for legal settlement Financing fees Issuance of restricted stock units for liability settlement Issuance of warrants for deferred compensation settlement in connection with FLAG Merger Issuance of common stock with term notes as interest paid in kind and other Assumed liabilities from FLAG Merger Assumed warrant liability from FLAG Merger Issuance of common stock as a result of the FLAG Merger Forward purchase agreement derivative asset Issuance of common stock upon conversion of convertible preferred stock Issuance of SAFE in lieu of cash for advisory services Issuance of common stock for Calidi debt settlement in connection with FLAG Merger Machinery and equipment acquired through financing leases $152 $ Issuance of common stock in lieu of cash for services $ $29 Issuance of common stock in lieu of cash for SEPA commitment fee $ $81 Issuance of warrants for legal settlement $ $158 Issuance of convertible note for legal settlement $ $1,500 Financing fees included in accounts payable and accrued liabilities $ $560 Discount on convertible note payable $ $149 Deemed dividend on warrants $ $1,671 Issuance of common stock per conversion of convertible note $ $1,028 Issuance of RSUs for liability settlement $ $105 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. F-6 CALIDI BIOTHERAPEUTICS, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. Organization and Nature of Operations On September 12, 2023, First Light Acquisition Group, Inc., a Delaware corporation ( FLAG ) consummated a series of transactions that resulted in the merger of FLAG Merger Sub Inc., a Nevada corporation and a wholly-owned subsidiary of FLAG and Calidi Biotherapeutics. Inc., a Nevada corporation ( Calidi and the transactions the Business Combination ). Following the consummation of the Business Combination, FLAG was renamed Calidi Biotherapeutics, Inc. and Calidi was renamed Calidi Biotherapeutics (Nevada), Inc. and became a wholly owned subsidiary of the Company. Unless the context otherwise requires, the Company refers to Calidi Biotherapeutics, Inc., a Delaware corporation (f/k/a First Light Acquisition Group, Inc., a Delaware corporation) and its consolidated subsidiaries. The Company is a clinical-stage biotechnology company that is developing genetic medicines and proprietary genetically-engineered oncolytic viruses. The Company is developing a pipeline of product candidates that are designed to: (i) protect oncolytic viruses from complement inactivation and innate immune cell inactivation by the body s immune system, (ii) deliver potent genetic payloads directly into the tumors, and (iii) modify the tumor microenvironment by promoting a strong and durable antitumor immune response to facilitate tumor elimination, potentially leading to an improved cancer therapy. The Company s operations to date have focused on organization and staffing, business planning, raising capital, licensing, acquiring and developing technology, establishing intellectual property portfolio, identifying potential product candidates and undertaking preclinical studies, process development and manufacturing for preclinical and clinical trials. The Company s product candidates are subject to long development cycles and the Company may be unsuccessful in its efforts to develop, obtain regulatory approval for or market its product candidates. The Company is subject to risks and uncertainties common to early-stage companies in the biotechnology industry, including, but not limited to, possible failure of preclinical studies or clinical trials, the need to obtain marketing approval for its product candidates, development by competitors of new technological innovations, dependence on key personnel, protection of proprietary technology, compliance with government regulations, the need to successfully commercialize and gain market acceptance of any of the Company s products that are approved and the ability to secure additional capital to fund operations. Product candidates currently under development will require significant additional research and development efforts, including extensive preclinical and clinical testing, and regulatory approval prior to commercialization. These efforts require significant amounts of additional capital, adequate personnel and infrastructure, and extensive compliance-reporting capabilities. Even if the Company s drug development efforts are successful, it is uncertain when, if ever, the Company will realize significant revenue from product sales. Reverse Stock Split On July 10, 2024, the Company filed a First Certificate of Amendment to its Second Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to effect a 1-for-10 reverse stock split of the shares of the Company s common stock, par value $0.0001 per share ( Common Stock ), effective on July 15, 2024 (the 2024 Reverse Stock Split ). As a result of the 2024 Reverse Stock Split, every ten shares of issued and outstanding Common Stock were automatically combined into one issued and outstanding share of Common Stock, without any change in the par value per share. No fractional shares were issued as a result of the 2024 Reverse Stock Split, and any fractional shares that would otherwise have resulted from the 2024 Reverse Stock Split were rounded up to the next whole number. The number of authorized shares of Common Stock under the Company s Second Amended and Restated Certificate of Incorporation, as amended, remained unchanged. F-7 On August 1, 2025, the Company filed a Second Certificate of Amendment to its Second Amended and Restated Certificate of Incorporation , as amended, with the Secretary of State of the State of Delaware to effect a 1-for-12 reverse stock split of the shares of the Company s common stock, par value $0.0001 per share ( Common Stock ), effective on August 4, 2025 (the 2025 Reverse Stock Split ). As a result of the 2025 Reverse Stock Split, every twelve shares of issued and outstanding Common Stock were automatically combined into one issued and outstanding share of Common Stock, without any change in the par value per share. No fractional shares were issued as a result of the 2025 Reverse Stock Split, and any fractional shares that would otherwise have resulted from the 2025 Reverse Stock Split were rounded up to the next whole number. The number of authorized shares of Common Stock under the Company s Second Amended and Restated Certificate of Incorporation, as amended, remained unchanged. Trading of the Company s shares of Common Stock on the NYSE American, LLC commenced on a split-adjusted basis on August 5, 2025. All references to share and per share amounts for all periods presented in the unaudited condensed consolidated financial statements have been retrospectively restated to reflect the 2024 Reverse Stock Split and 2025 Reverse Stock Split. All rights to receive shares of common stock under outstanding securities, including but not limited to, warrants, options, and restricted stock units ( RSUs ) were adjusted to give effect to the reverse stock split. Furthermore, proportionate adjustments were made to the per share exercise price and the number of shares of Common Stock that may be purchased upon exercise of outstanding stock options granted by the Company, and the number of shares of Common Stock reserved for future issuance under the Company s 2023 Equity Incentive Plan. Liquidity and Going Concern The unaudited condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and settlement of liabilities in the normal course of business, and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or amounts and classification of liabilities that may result from the outcome of this uncertainty. The Company has experienced recurring losses from operations and negative cash flows from operating activities, has a significant accumulated deficit and expects to continue to incur net losses into the foreseeable future. The Company had an accumulated deficit of $132.4 million at June 30, 2025. During the six months ended June 30, 2025, the Company used $12.0 million of cash for operating activities. As of June 30, 2025, the Company had cash of $5.3 million and restricted cash of $0.1 million. Management expects operating losses and negative cash flows to continue for the foreseeable future. Management estimates that based on the Company s liquidity resources, there is substantial doubt about the Company s ability to continue as a going concern within 12 months from the date of issuance of the unaudited condensed consolidated financial statements. The accompanying unaudited condensed consolidated financial statements have been prepared on the basis of the Company continuing to operate in the normal course of business and does not reflect any adjustments to the assets and liabilities related to the substantial doubt of its ability to continue as a going concern. Management s ability to continue as a going concern is dependent upon its ability to raise additional funding. Management s plans to raise additional capital through public or private equity or debt financing to fulfill its operating and capital requirements for at least 12 months from the date of the issuance of the financial statements. However, the Company may not be able to secure such financing in a timely manner or on favorable terms, if at all. Furthermore, if the Company issues equity securities to raise additional funds, its existing stockholders may experience dilution, and the new equity securities may have rights, preferences and privileges senior to those of the Company s existing stockholders. Risks and Uncertainties Changes in economic conditions, including rising interest rates, public health issues, lower consumer confidence, volatile equity capital markets, ongoing supply chain disruptions and the impacts of geopolitical conflicts, may affect the Company s operations. F-8 2. Summary of Significant Accounting Policies Unaudited Interim Financial Information The accompanying unaudited condensed consolidated financial statements as of June 30, 2025, and for the three and six months ended June 30, 2025 and 2024, have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission ( SEC ) and in conformity with accounting principles generally accepted in the United States of America ( U.S. GAAP ) for interim financial reporting. Accordingly, these unaudited condensed consolidated financial statements do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, these unaudited condensed consolidated financial statements contain all adjustments necessary, all of which are of a normal and recurring nature, to state fairly the Company s financial position, results of operations and cash flows. Interim results are not necessarily indicative of results for a full year or future periods. These unaudited condensed consolidated financial statements should be read in conjunction with Calidi s audited consolidated financial statements for the year ended December 31, 2024 in the Company s Form 10-K, which was filed with the SEC on March 31, 2025. Any reference in these notes to applicable guidance is meant to refer to the authoritative U.S. GAAP as found in the Accounting Standards Codification ( ASC ) and Accounting Standards Update ( ASU ) of the FASB. Principles of Consolidation The accompanying unaudited condensed consolidated financial statements of the Company include the accounts of its wholly owned subsidiary, Calidi Biotherapeutics (Nevada), Inc., a company incorporated in the state of Nevada and Calidi Biotherapeutics, Inc., StemVac GmbH ( StemVac ), a company organized under the laws of Germany, and Calidi Biotherapeutics Australia Pty Ltd ( Calidi Australia ), a wholly owned Australian subsidiary, Nova Cell, Inc. ( Nova Cell ), a subsidiary incorporated in the state of Nevada, and RedTail Biopharma, Inc. ( RedTail ), a wholly owned subsidiary incorporated in the state of Nevada. StemVac s primary operating activities include process development and other research and development activities for the Company under a cost-plus intercompany development agreement funded by the Company. Calidi Australia s principal purpose was for conducting certain parts of the SNV1 clinical enabling activities in Australia. Nova Cell s primary operating activities will be expanding potential uses of the Company s AAA stem cell programs from oncology to other fields that require regenerative medical applications, such as cosmetics, orthopedics, auto-immune diseases, and various other therapies. Nova Cell will also serve as a technology service provider to develop innovative stem cell-based products, such as anti-aging creams and lotions. RedTail s primary operating activities will be to expand on the Company s systemic antitumor virotherapies. Both Nova Cell and RedTail were incorporated in May 2024. RedTail has had no activity to date. Variable interest entities ( VIEs ) are legal entities that either have an insufficient amount of equity at risk for the entity to finance its activities without additional subordinated financial support or, as a group, the holders of equity investment at risk lack the ability to direct the entity s activities that most significantly impact economic performance through voting or similar rights, or do not have the obligation to absorb the expected losses or the right to receive expected residual returns of the entity. For all VIEs in which the Company is involved, it assesses whether it is the primary beneficiary on an ongoing basis. In circumstances where the Company has both the power to direct the activities that most significantly impact the VIEs performance and the obligation to absorb losses or the right to receive the benefits of the VIE that could be significant, the Company would conclude that it is the primary beneficiary of the VIE, and the Company consolidates the VIE. In situations where the Company is not deemed to be the primary beneficiary of the VIE, it does not consolidate the VIE and only recognizes the Company s interests in the VIE. The Company owns 75% of Nova Cell s fully-diluted capitalization, with the remaining 25% owned by a related party investor (see Note 8). Under the rules of determining whether an entity is a VIE, the Company has a controlling financial interest and is deemed to be the primary beneficiary of Nova Cell and therefore consolidates Nova Cell s financial statements. Since the Company owns less than 100% of Nova Cell, the Company records net loss attributable to noncontrolling interest in its consolidated statements of operations equal to the percentage of the economic or ownership interests retained in Nova Cell by the noncontrolling party. F-9 The accompanying unaudited condensed consolidated financial statements include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the Company s financial condition and results of operations. All material intercompany accounts and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and contingent assets and liabilities, at the date of the unaudited condensed consolidated financial statements, and the reported amounts during the reporting period. On an ongoing basis, management evaluates estimates which are subject to significant judgment, including, but not limited to, valuation methods used, assumptions requiring the use of judgment to prepare financial projections, timing of potential commercialization of acquired in-process intangible assets, applicable discount rates, comparable companies or transactions, liquidity events, assumptions related to the going concern assessments, allocation of direct and indirect expenses, useful lives associated with long- lived assets, key assumptions in operating and financing leases including incremental borrowing rates, loss contingencies, valuation allowances related to deferred income taxes, assumptions used to value common stock, debt and debt-like instruments, warrants, and stock-based awards and other equity instruments. Actual results may differ materially from those estimates. Cash and Restricted Cash The Company considers all highly liquid investments purchased with an original maturity date of ninety days or less to be cash equivalents. Cash and cash equivalents include cash in readily available checking, money market accounts and brokerage accounts. The Company classifies cash that has contractual or legal restrictions imposed by third parties as restricted cash, which is restricted as to withdrawal or use except for the specified purpose under a contract. The Company classifies restricted cash as either part of prepaids and other current assets, or as part of other noncurrent assets, depending on the term and nature of the underlying contract with a financial institution, which requires the Company to hold a fixed amount of funds in a restricted money market account as collateral to the financial institution for the Company s corporate credit card program with that financial institution. The following table provides a reconciliation of cash and restricted cash reported within the balance sheet dates that comprise the total of the same such amounts shown in the unaudited condensed consolidated statements of cash flows (in thousands): Schedule of Cash and Cash Equivalents June 30, 2025 June 30, 2024 Cash $5,279 $836 Restricted cash included within prepaid expenses and other current assets 100 100 Restricted cash included within other noncurrent assets 118 Total cash and restricted cash as shown in the unaudited condensed consolidated statements of cash flows $5,379 $1,054 F-10 Machinery and Equipment Machinery and equipment are stated at cost, less accumulated depreciation, and includes assets purchased under financing leases. Depreciation is computed using the straight-line method over the estimated useful lives of the assets, generally over a period of 3 to 5 years. For equipment purchased under financing leases, The Company depreciates the equipment based on the shorter of the useful life of the equipment or the term of the lease, ranging from 3 to 5 years, depending on the nature and classification of the financing lease. Maintenance and repairs are expensed as incurred whereas significant renewals and betterments are capitalized. When assets are retired or otherwise disposed of, the cost and the related accumulated depreciation are removed from the respective accounts and any resulting gain or loss is reflected in the Company s unaudited condensed consolidated statements of operations. Leases The Company accounts for leases in accordance with ASC 842, Leases. The Company determines if an arrangement is a lease at inception. Leases are classified as either finance or operating, with classification affecting the pattern of expense recognition in the unaudited condensed consolidated statements of operations. When determining whether a lease is a finance lease or an operating lease, ASC 842 does not specifically define criteria to determine major part of remaining economic life of the underlying asset and substantially all of the fair value of the underlying asset. For lease classification determination, the Company continues to use: (i) greater than or equal to 75% to determine whether the lease term is a major part of the remaining economic life of the underlying asset; and (ii) greater than or equal to 90% to determine whether the present value of the sum of lease payments is substantially all of the fair value of the underlying asset. The Company accounts for the lease and non-lease components as a single lease component. For operating leases, the Company recognizes right-of-use ( ROU ) assets and lease liabilities for leases with terms greater than 12 months in the unaudited condensed consolidated balance sheet, while leases with terms of 12 months or less are not capitalized. ROU assets represent the right to use an underlying asset during the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most leases do not provide an implicit rate, the Company uses an incremental borrowing rate commensurate with the lease term, based on the information available at commencement date in determining the present value of lease payments. The Company uses the implicit rate when it is readily determinable. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. The Company discloses the amortization of ROU assets and operating lease payments as a net amount, Amortization of right-of-use assets and liabilities , on the unaudited condensed consolidated statements of cash flows. Finance leases are included in machinery and equipment, and in finance lease liabilities, current and noncurrent, in the unaudited condensed consolidated balance sheets. The Company discloses the amortization of finance ROU assets in depreciation and amortization expense on the unaudited condensed consolidated statements of cash flows. See Note 11 for further disclosures in accordance with ASC 842. Impairment of Long-lived Assets The Company assesses the impairment of long-lived assets, which consist primarily of right-of-use assets for operating leases and machinery and equipment, whenever events or changes in circumstances indicate that such assets might be impaired and the carrying value may not be recoverable. If events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable and the expected undiscounted future cash flows attributable to the asset are less than the carrying amount of the asset, an impairment loss equal to the excess of the assets carrying value over its fair value is recorded in the Company s unaudited condensed consolidated statements of operations. Warrants The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant s specific terms and applicable authoritative guidance in ASC 480, Distinguishing Liabilities from Equity, and ASC 815, Derivatives and Hedging. Warrants that meet the definition of a derivative financial instrument and the equity scope exception in ASC 815-10-15-74(a) are classified as equity and are not subject to remeasurement provided that the Company continues to meet the criteria for equity classification. Warrants that are classified as liabilities are accounted for at fair value and remeasured at each reporting date until exercise, expiration, or modification that results in equity classification. Any change in the fair value of the warrants is recognized as change in fair value of warrant liabilities in the unaudited condensed consolidated statements of operations. The classification of warrants, including whether warrants should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period. The fair value of liability-classified warrants is determined using the Black-Scholes options pricing model ( Black-Scholes model ) which includes Level 3 inputs. F-11 Fair Value Measurements The Company follows ASC 820, Fair Value Measurement, which among other things, defines fair value, establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis. Fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. Accordingly, fair value is a market-based measurement determined based on assumptions that market participants would use in pricing an asset or liability. The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 establishes a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure fair value, which are as follows: Level 1: Quoted prices in active markets for identical assets and liabilities; Level 2: Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted market prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and Level 3: Unobservable inputs in which there is little or no market data and that are significant to the fair value of the assets or liabilities, which require the reporting entity to develop its own assumptions. When quoted market prices are available in active markets, the fair value of assets and liabilities is estimated within Level 1 of the valuation hierarchy. If quoted prices are not available, then fair values are estimated by using pricing models, quoted prices of assets and liabilities with similar characteristics, or discounted cash flows, within Level 2 of the valuation hierarchy. In cases where Level 1 or Level 2 inputs are not available, the fair values are estimated by using inputs within Level 3 of the hierarchy. See Note 3 for fair value measurements. Derivative Financial Instruments The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC 815, Derivatives and Hedging. The Company values its derivatives using the Black-Scholes option-pricing model or other acceptable valuation models, as applicable, with the assistance of valuation specialists. Derivative instruments accounted for as liabilities are valued at inception and subsequent valuation dates for each reporting period the derivative instrument remains outstanding. The classification of derivative instruments, including whether such instruments should be recorded as liabilities, is reassessed at each reporting period. The Company evaluates equity or liability classification for common stock warrants in accordance with ASC 480, Distinguishing Liabilities from Equity, and ASC 815 and accounts for common stock warrants as liabilities if the warrant requires net cash settlement or gives the holder the option of net cash settlement or it otherwise does not meet other equity classification criteria. The Company accounts for common stock warrants as equity if the contract requires physical settlement or net physical settlement or if the Company has the option of physical settlement or net physical settlement and the warrants meet the requirements to be classified as equity. Common stock warrants classified as liabilities are initially recorded at fair value and remeasured at fair value at each subsequent reporting period with the offset adjustments recorded in change in fair value of warrant liability within the unaudited condensed consolidated statements of operations. Common stock warrants classified as equity are initially measured at fair value on the grant date and are not subsequently remeasured. F-12 Government Grants On October 27, 2022, the California Institute for Regenerative Medicine ( CIRM ) approved the Company s application for a CIRM grant for the Company s continued development of the SNV1 program. CIRM awarded the Company approximately $3.1 million of CIRM funding conditioned that the Company co-fund approximately $0.8 million under the requirements of the CIRM application. On December 28, 2022, the Company received the Notice of Award from CIRM for this grant. The Company drew $3.1 million in funds based on the operational milestones defined in the grant. Proceeds from the CIRM grant are recognized over the period necessary to match the related research and development expenses when it is probable that the Company has complied with the CIRM conditions and will receive the proceeds pursuant to the milestones defined in the grant as reimbursement of those expenditures. The CIRM grant proceeds, if any, received in advance of having incurred the related research and development expenses are recorded in accrued expenses and other current liabilities and recognized as grant income included in other income (expense), net, on the Company s unaudited condensed consolidated statements of operations when the related research and development expenses are incurred. During both the three and six months ended June 30, 2025 and 2024, the Company recognized approximately $50,000 and $0.2 million in grant income in the accompanying unaudited condensed consolidated statements of operations, respectively. Research and Development Expenses Research and development expenses are expensed as incurred. Research and development expenses consist of costs incurred to discover, research and develop drug candidates, including compensation-related expenses for research and development personnel, including stock-based compensation expense, preclinical and clinical activities, costs of manufacturing, overhead expenses including facilities and laboratory expenses, materials and supplies, amounts paid to consultants and outside service providers, and depreciation and amortization. Upfront and annual license payments related to acquired technologies or technology licenses which have not yet reached technological feasibility and have no alternative future use are also included in research and development expense in the period in which they are incurred. General and Administrative Expenses General and administrative expenses consist primarily of salaries and related costs, including stock-based compensation expense, for personnel in executive, finance and accounting, business development, operations and administrative functions. General and administrative expenses also include fees for legal, patent prosecution, legal settlements, consulting, accounting and audit services as well as insurance, outside service providers, direct and allocated facility-related costs and depreciation and amortization. Foreign Currency Translation Adjustments and Other Comprehensive Income or Loss StemVac, the Company s wholly owned subsidiary, is located and operates in Germany and its functional currency is the Euro. Calidi Australia, the Company s wholly owned subsidiary, is located and operates in Australia and its functional currency is the Australian Dollar ( AUD ). Accordingly, StemVac s and Calidi Australia s assets and liabilities are translated using respective published exchange rates in effect at the unaudited condensed consolidated balance sheet date. Expenses and cash flows are translated using respective approximate weighted average exchange rates for the reporting period. Resulting foreign currency translation adjustments are recorded as other comprehensive income or loss, net of tax, in the unaudited condensed consolidated statements of comprehensive income or loss and included as a component of accumulated other comprehensive income or loss on the unaudited condensed consolidated balance sheets. For the three and six months ended June 30, 2025 and 2024, comprehensive loss includes such foreign currency translation adjustments and was insignificant for all periods presented. F-13 Foreign Currency Transaction Gains and Losses For transactions denominated in currencies other than the U.S. dollar, the Company recognizes foreign currency transaction gains and losses in the unaudited condensed consolidated statements of operations and classifies the gain or loss based on the nature of the item that generated it. The Company s foreign currency transaction gains and losses are principally generated by intercompany transfers to StemVac denominated in Euros to pay for the research and development activities performed by StemVac under an intercompany development agreement with the Company. Furthermore, the Company s foreign currency transaction gains and losses include intercompany transfers to Calidi Australia denominated in AUD to pay for the research and development activities performed by Calidi Australia. These foreign currency remeasurement gains and losses are included in other income (expense), net, and were insignificant for all periods presented. Stock-Based Compensation The Company recognizes compensation expense related to employee option grants and restricted stock grants, if any, in accordance with ASC 718, Compensation Stock Compensation ( ASC 718 ). The Company measures all stock options and other stock-based awards granted based on the fair value of the award on the date of the grant and recognizes compensation expense for those awards over the requisite service period, which is generally the vesting period of the respective award. The Company has elected to recognize forfeitures as they occur. The reversal of compensation cost previously recognized for an award that is forfeited because of a failure to satisfy a service condition is recognized in the period of the forfeiture. Generally, and unless otherwise specified, the Company s grants stock options with service-based only vesting conditions and records the expense for these awards using the straight-line method over the requisite service period. The Company classifies stock-based compensation expense in its consolidated statements of operations in the same manner in which the award recipient s payroll costs are classified or in which the award recipients service payments are classified. The fair value of each stock option grant is estimated using the Black-Scholes option-pricing model. The Company estimates its expected stock volatility based on the historical volatility of a publicly traded set of peer companies within the biotechnology industry with characteristics similar to the Company. The expected term of the Company s stock options has been determined utilizing the simplified method for awards that qualify as plain-vanilla options provided under Staff Accounting Bulletin, Topic 14, or SAB Topic 14, as necessary. The risk-free interest rate is determined by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the expected term of the award. Expected dividend yield is zero, based on the fact that the Company has never paid cash dividends and does not expect to pay any cash dividends in the foreseeable future. Net Loss per share of Common Stock Loss per share attributable to common stockholders is calculated using the two-class method, which is an earnings allocation formula that determines earnings per share for the holders of the Company s shares of Common Stock and participating securities. However, the participating securities do not include a contractual obligation to share in the losses of the Company and are not included in the calculation of net loss per share in the periods that have a net loss. In addition, common stock equivalent shares (whether or not participating) are excluded from the computation of diluted earnings per share in periods in which they have an anti-dilutive effect on net loss per share of Common Stock. Diluted net loss per share is computed using the more dilutive of (a) the two-class method or (b) the if-converted method and treasury stock method, as applicable. In periods in which the Company reports a net loss attributable to common stockholders, diluted net loss per share attributable to common stockholders is the same as basic net loss per share attributable to common stockholders since dilutive common stock shares are not assumed to have been issued if their effect is anti-dilutive. Diluted net loss per share is equivalent to basic net loss per share for the periods presented herein because common stock equivalent shares from the outstanding warrants, earnout shares, convertible notes, stock option awards, restricted stock units, and contingently issuable warrants (see Note 8) were antidilutive. F-14 As a result of the Company reported net loss attributable to common stockholders for all periods presented herein, the following common stock equivalents were excluded from the computation of diluted net loss per share of Common Stock for the six months ended June 30, 2025 and 2024 because including them would have been antidilutive (in thousands): Schedule of Computation of Diluted Net Loss per Common Share including Antidilutive 2025 2024 (2) Six Months Ended June 30, 2025 2024 Warrants for common stock 1,403 655 Earnout shares 150 150 Convertible notes payable 93 Employee stock options 131 71 Restricted stock units 3 Commitments to issue common stock 2 Contingently issuable warrants(1) Total common stock equivalents 1,684 974 (1) The contingently issuable warrant was not included for purposes of calculating the number of diluted shares outstanding as of June 30, 2024, as the number of dilutive shares is based on a contingency not yet resolved as of period end and the contingently resulting number of dilutive shares is not determinable until the contingency is resolved. As of June 30, 2025, the contingency was resolved in full and there were no contingently issuable warrants outstanding. Segments Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision maker (or CODM), the Executive Management Team, consisting of the following individuals: Chief Executive Officer Chief Financial Officer Chief Legal Officer Chief Scientific Officer and Head of Technical Operations Chief Medical Officer, Consultant and Advisor The Company views its operations and manages its business as a single reportable segment whose operations includes the research, development and commercialization efforts of platforms to potentiate oncolytic virus therapies on a consolidated basis, as further described in Note 1. The Company manages its Research and Development ( R&D ) activities on a consolidated basis. The Company expects to generate future income from a combination of license fees and other upfront payments, funded R&D agreements, milestone payments, product sales, government and other third-party funding, and royalties, which depend on the results, regulatory approval, and timing of the successful commercialization of the Company s products. Net loss is the measure of segment profit or loss used by CODM in making decisions regarding resource allocation and evaluating financial performance, which is also reported on the unaudited condensed consolidated statements of operations and comprehensive loss. The CODM does not evaluate its reportable segment using asset or liability information. The CODM uses net loss in making decisions regarding resource allocation and evaluating financial performance. The following table presents selected financial information with respect to the Company s single operating segment for the three and six months ended June 30, 2025 and 2024: Schedule of Operating Segment 2025 2024 2025 2024 Three Months Ended June 30, Six Months Ended June 30, 2025 2024 2025 2024 OPERATING EXPENSES Salaries and benefits $(2,957) $(2,837) $(5,147) $(5,823) Insurance (238) (404) (474) (801) Legal (350) (427) (649) (1,217) Consulting (592) (336) (1,211) (841) Rent and Maintenance (610) (554) (1,175) (1,072) Clinical & research and development (427) (304) (890) (1,051) Depreciation (96) (101) (187) (202) Change in fair value of other liabilities and derivatives (19) 95 16 (104) Other segment items (1) (468) (891) (1,099) (1,869) Income tax provision (4) (8) (7) (12) NET LOSS $(5,761) $(5,767) $(10,823) $(12,992) (1) Other segment items include interest expense, grant income, and other income (expense). Recently Adopted Accounting Pronouncements There were no new accounting pronouncements adopted during the six months ended June 30, 2025. Recently Issued Accounting Pronouncements Not Yet Adopted In December 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures (Topic 740). The ASU requires disaggregated information about a reporting entity s effective tax rate reconciliation as well as additional information on income taxes paid. The ASU is effective on a prospective basis for annual periods beginning after December 15, 2024. Early adoption is also permitted for annual financial statements that have not yet been issued or made available for issuance. The Company is currently evaluating the impact of adopting ASU 2023-09. In November 2024, the FASB issued ASU 2024-03, Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement and in January 2025, issued ASU 2025-01 Income Statement Reporting Comprehensive Income Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date to clarify the effective date of ASU 2024-03. ASU 2024-03 requires the disaggregation of certain costs and expenses in the notes to the financial statements to provide enhanced transparency into the expense captions presented on the face of the income statement. The ASU is effective for annual periods beginning after December 15, 2026 and for interim reporting periods within annual reporting periods beginning after December 15, 2027. The guidance may be applied on a prospective or retrospective basis and early adoption is permitted. The Company is currently evaluating the impact of adopting ASU 2024-03. F-15 3. Fair Value Measurements The following table presents the Company s assets and liabilities that are measured at fair value on a recurring basis, inclusive of related party components, as of June 30, 2025 and December 31, 2024 (in thousands): Schedule of Assets and Liabilities that are Measured at Fair Value on a Recurring Basis Level 1 Level 2 Level 3 Total June 30, 2025 (unaudited) Level 1 Level 2 Level 3 Total Assets: Restricted cash held in a money market account $100 $ $ $100 Forward Purchase Agreement Derivative Asset included in other noncurrent assets 2 2 Total assets, at fair value $100 $ $2 $102 Liabilities: Public Warrants $89 $ $ $89 Private warrants 14 14 Total warrant liabilities, at fair value $89 $14 $ $103 Level 1 Level 2 Level 3 Total December 31, 2024 Level 1 Level 2 Level 3 Total Assets: Restricted cash held in a money market account $218 $ $ $218 Forward Purchase Agreement Derivative Asset included in other noncurrent assets 11 11 Total assets, at fair value $218 $ $11 $229 Liabilities: Public Warrants $110 $ $ $110 Private warrants 18 18 Total warrant liabilities, at fair value $110 $18 $ $128 The Company s financial instruments consist of cash, prepaid expenses and other current assets, accounts payable, accrued expenses, and other current liabilities. The carrying value of these financial instruments is generally considered to approximate their fair values because of the short-term nature of those instruments. The following table presents the changes in fair value of valued instruments for the three and six months ended June 30, 2025 (in thousands): Schedule of Changes in Fair Value of Level 3 Valued Instruments Forward Purchase Agreement Derivative Asset, at fair value Public Warrants, at fair value Private Warrants, at fair value Three Months Ended June 30, 2025 Forward Purchase Agreement Derivative Asset, at fair value Public Warrants, at fair value Private Warrants, at fair value Balance at April 1, 2025 $(5) $75 $12 Change in fair value 3 14 2 Balance at June 30, 2025 $(2) $89 $14 Forward Purchase Agreement Derivative Asset, at fair value Public Warrants, at fair value Private Warrants, at fair value Six Months Ended June 30, 2025 Forward Purchase Agreement Derivative Asset, at fair value Public Warrants, at fair value Private Warrants, at fair value Balance at January 1, 2025 $(11) $110 $18 Change in fair value 9 (21) (4) Balance at June 30, 2025 $(2) $89 $14 F-16 The following table presents the changes in fair value of valued instruments for the three and six months ended June 30, 2024 (in thousands): Forward Purchase Agreement Derivative Asset, at fair value Public Warrants, at fair value Private warrants, at fair value Three Months Ended June 30, 2024 Forward Purchase Agreement Derivative Asset, at fair value Public Warrants, at fair value Private warrants, at fair value Balance at April 1, 2024 $(57) $598 $99 Change in fair value 37 (114) (18) Balance at June 30, 2024 $(20) $484 $81 Forward Purchase Agreement Derivative Asset, at fair value Public Warrants, at fair value Private warrants, at fair value Six Months Ended June 30, 2024 Forward Purchase Agreement Derivative Asset, at fair value Public Warrants, at fair value Private warrants, at fair value Balance at January 1, 2024 $ (230 ) $ 575 $ 96 Change in fair value 210 (91 ) (15 ) Balance at June 30, 2024 $ (20 ) $ 484 $ 81 4. Selected Balance Sheet Components Accrued Expenses and Other Current Liabilities As of June 30, 2025 and December 31, 2024, accrued expenses and other current liabilities were comprised of the following (in thousands): Schedule of Accrued Expenses and Other Current Liabilities June 30, 2025 December 31, 2024 Accrued compensation $1,276 $1,344 Accrued vendor and other expenses 658 994 Accrued expenses and other current liabilities $1,934 $2,338 See Note 11 for additional commitments. Prepaid Expenses and Other Current Assets As of June 30, 2025 and December 31, 2024, prepaid expenses and other current assets were comprised of the following (in thousands): Schedule of Prepaid Expenses and Other Current Assets June 30, 2025 December 31, 2024 Prepaid expenses $163 $99 Prepaid insurance 214 288 CIRM receivable 50 Other 343 249 Prepaid expenses and other current assets $770 $636 F-17 5. Machinery and Equipment, net As of June 30, 2025 and December 31, 2024, machinery and equipment, net, was comprised of the following (in thousands): Schedule of Machinery and Equipment, Net June 30, 2025 December 31, 2024 Machinery and equipment $2,536 $2,224 Accumulated depreciation (1,607) (1,355) Machinery and equipment, net $929 $869 Depreciation and amortization expense amounted to approximately $0.1 million and $0.2 million for the three and six months ended June 30, 2025, respectively. Depreciation and amortization expense amounted to approximately $0.1 million and $0.2 million for the three and six months ended June 30, 2024, respectively. 6. Related Party Transactions Prior to completing the Business Combination and becoming publicly traded in September 2023, the Company funded its operations primarily through issuances of convertible promissory notes and private sales of common stock. These investments included various related parties, including from AJC Capital and certain directors as further discussed below. The following table presents the various significant related party transactions and investments in the Company for the periods presented (in thousands): Schedule of Related Party Transactions Related Party Description of investment or transaction June 30, 2025 December 31, 2024 Director A and Director E Current term notes payable, net of discount, including accrued interest(1) 775 2,702 Director F and relative of Officer A Accounts payable and accrued expenses(2) 21 30 Director F Former Chief Executive Officer(3) 432 Director D Former President and Chief Operating Officer(4) 434 Director A Advisory services included in accrued expenses(5) 18 Director F Lease guaranty(6) 4 186 Director A Other liabilities(7) 638 Director F and Director A Warrant liability(8) 7 9 Relative of Officer A Loan payable(9) 223 Related party transactions Loan payable(9) 223 (1) As of June 30, 2025, related party term note payable amounts due to Directors A totaling $0.8 million, inclusive of principal amounts totaling $0.4 million and accrued interest amounts totaling $0.4 million, have been classified as a short term liability on the accompanying unaudited condensed consolidated balance sheets. As of December 31, 2024, related party term note payable amounts due to Directors A and E totaled $2.7 million. See Note 7 for further details. (2) Amounts owed to Director F as of June 30, 2025 and December 31, 2024, for reimbursable expenses; in addition, amounts owed to a relative of Officer A for certain legal fees, included in accounts payable and accrued expenses. In April 2025, $28,000 was settled with Director F. (3) On April 22, 2025, the Company executed a General Release of Claims and Transition Agreement ( Release Agreement ) with Mr. Camaisa, (Director F referenced above), and is obligated to pay Director F $500,000 separation pay in the form of compensation continuation over 12 months pursuant to our regular and customary payroll schedule, less all regular and customary payroll withholdings and shall also be liable to pay Director F COBRA premiums for 12 months, commencing May 2025. Director F shall also be entitled to receive a transition/ consulting pay of $10,000 per month during the transition period. The Company expensed $20,000 for the three and six months ended June 30, 2025. (4) On February 1, 2022, the Company appointed a then current board member (Director D referenced above), George K. Ng, as President and Chief Operating Officer of the Company under an Employment Agreement (the Ng Agreement ). Under the Ng Agreement, Mr. Ng was entitled to a base annual salary of $0.5 million and a signing bonus of $0.3 million, payable in three equal monthly installments. Mr. Ng was eligible for standard change in control and severance benefits. On June 23, 2023, the Company entered into a Separation and Release Agreement with Mr. Ng which included a severance accrual and accrued interest as of December 31, 2024 (see Note 11). The lump sum payment and accrued interest was settled in January 2025. F-18 (5) On April 1, 2022, the Company entered into an Advisory Agreement with Scott Leftwich (Director A referenced above), for providing certain strategic and advisory services. Director A received an advisory fee of $9,166 per month not to exceed $0.1 million per annum, accrued and payable upon the Company raising $10 million or more in equity proceeds, as defined in the Advisory Agreement. The Advisory Agreement terminated on August 31, 2023. The accrued advisory fees were settled in January 2025. (6) In October 2022, in order for the Company to secure and execute the San Diego Lease discussed in Note 11, Director F, provided a personal Guaranty of Lease of (the Guaranty ) up to $0.9 million to the lessor for the Company s future performance under the San Diego Lease agreement. As consideration for the Guaranty, the Company agreed to pay Director F 10% of the Guaranty amount for the first year of the San Diego Lease, and 5% per annum of the Guaranty amount thereafter through the life of the lease, with all amounts accrued and payable at the termination of the San Diego Lease or release of Director F from the Guaranty by the lessor, whichever occurs first. As of June 30, 2025 and December 31, 2024, the amounts shown in the table above represents the present value, including accrued interest as of the period shown, of approximately $4,000 and $0.2 million, respectively, payment due to Director F upon the release or termination of the Guaranty, which is included in non-current operating lease right-of-use liability. The amount due to Director F was partially settled in April 2025. (7) In August 2023, the Company entered into an agreement with Director A for deferred compensation including advisory fees for $0.5 million, which was paid in January 2025 (see Note 11). The $0.5 million note bore interest at 24% through August 12, 2024, at which time the note was amended and replaced with an interest rate of 14% per annum. The deferred compensation and advisory fees were settled in January 2025. (8) See Note 8 for disclosures around Warrants. (9) In January 2024, the Company entered into a loan agreement with a relative of Officer A for a loan payable for $0.2 million, which bears interest at 12%. The loan was settled in full in January 2025. 7. Debt The Company s outstanding debt obligations as of June 30, 2025 and December 31, 2024, including related party components, are as follows (in thousands): Schedule of Outstanding Debt Obligations June 30, 2025 Unpaid Balance Accrued Interest Net Carrying Value Term notes payable $375 $400 $775 Promissory note 600 45 645 Total debt $975 $445 $1,420 Less: current portion of long-term debt (820) Long-term debt, net of current portion $600 December 31, 2024 Unpaid Balance Accrued Interest Net Carrying Value Term notes payable $2,200 $753 $2,953 Bridge loan payable 200 23 223 Promissory note 600 45 645 Total debt $3,000 $821 $3,821 Less: current portion of long-term debt (3,221) Long-term debt, net of current portion $600 F-19 Scheduled maturities of outstanding debt, net of discounts as of June 30, 2025 are as follows (in thousands): Schedule of Maturities of Outstanding Debt Year Ending December 31: 2025 (July December) $375 2026 2027 600 2028 and thereafter Plus: accrued interest 445 Total debt $1,420 The following discussion includes a description of the Company s outstanding debt as of June 30, 2025 and December 31, 2024. The weighted average interest rate related to the Company s outstanding debt was approximately 14.6% and 14.4% as of June 30, 2025 and December 31, 2024, respectively. Interest expense related to the Company s outstanding debt totaled approximately $40,000 and $0.2 million for the three months ended June 30, 2025 and 2024, respectively, and approximately $0.1 million and $0.4 million for the six months ended June 30, 2025 and 2024, respectively, which is reported within other income (expense), net, in the unaudited condensed consolidated statements of operations. Term Notes Payable 2021 Term Notes Payable In January 2021, Calidi entered into a note agreement with a related party investor and director to borrow up to $0.5 million ( 2021 Term Note ). As of December 31, 2024, the interest rate of the 2021 Term Notes was 14%, and the total carrying value, including accrued interest was approximately $0.7 million. The total outstanding principal and accrued interest of 2021 Term Note of $0.7 million was settled in full in January 2025. As of that date, the 2021 Term Notes were no longer outstanding. 2022 Term Notes Payable In November and December 2022, the Company issued $1.5 million of secured term notes payable (the 2022 Term Notes ) to investors, including to related parties (see Note 6). On October 3 and November 8, 2023, the Company settled in cash $0.1 million and $0.2 million, respectively, of principal of 2022 Term Notes plus accrued interest. Said term notes payable were no longer outstanding as of the settlement date. As of December 31, 2024, the interest rate of the 2022 Term Notes was 14% per annum, for a total principal of $0.2 million, and 16% per annum, for a total principal of $0.2 million. As of December 31, 2024, the total carrying value, including accrued interest, was $0.4 million. The total outstanding principal and accrued interest of 2022 Term Notes of $0.4 million was settled in full in January 2025. As of that date, the 2022 Term Notes were no longer outstanding. 2023 Term Notes Payable From January through September 2023, the Company issued $3.3 million of secured term notes payable (the 2023 Term Notes ) to investors, including to related parties (see Note 6). On October 3, 2023, as agreed upon above in connection with the Closing of the FLAG Merger, the Company settled in cash $0.6 million of principal of 2023 Term Notes plus accrued interest and said term notes payable were no longer outstanding as of that date. F-20 During the year ended December 31, 2024, the Company settled in cash $0.3 million of principal of 2023 Term Notes plus accrued interest. On December 23, 2024, pursuant to the debt amendment on $1.0 million of the 2023 Term Notes, commencing on February 1, 2025, the Company shall pay the holder, a related party, $0.1 million each month until the 2023 Term Notes principal and interest are fully paid. The principal shall continue accruing interest of 14% per annum until fully paid. During the six months ended June 30, 2025, $0.6 million was paid in accordance with this agreement. During the six months ended June 30, 2025, $0.5 million of the outstanding principal and accrued interest of the 2023 Term Notes was settled in cash. As of June 30, 2025, the interest rate of the 2023 Term Notes was 14% per annum, for a total principal of $0.4 million. As of December 31, 2024, the interest rate was 14% and 18% per annum for a total principal of $1.2 million and $0.2 million, respectively. As of June 30, 2025 and December 31, 2024, the total carrying value, including accrued interest and net of debt discount, was $0.8 million and $1.9 million, respectively. 2024 Bridge Loan On January 19, 2024, the Company received approximately $0.2 million in aggregate proceeds from the issuance of certain bridge loans (the 2024 Bridge Loan ), which mature one year from the issuance date and bear simple interest of 12% per annum. As consideration for the 2024 Term Loans, the Company issued an aggregate of 75 shares of restricted common stock to the Lender. As of December 31, 2024, the total carrying value of the 2024 Bridge Loan, including accrued interest and net of debt discount, was $0.2 million. The total outstanding principal and accrued interest of the 2024 Bridge Loan of $0.2 million was settled in full in January 2025. As of that date, the bridge loan was no longer outstanding. Convertible Promissory Notes On January 26, 2024, the Company entered into a convertible promissory note purchase agreement (the 2024 Purchase Agreement ) with an Accredited Investor (the Investor ) for a loan in the principal amount of $1.0 million (the 2024 Convertible Note Loan ). In connection with the Convertible Note Loan, the Company issued a one-year convertible promissory note evidencing the aggregate principal amount of $1.0 million under the Loan, which accrues at a 12.0% simple interest rate per annum (the 2024 Convertible Note ). On April 18, 2024, pursuant to the April Public Offering, the Company s $1.0 million convertible note, inclusive of outstanding principal and accrued interest, was automatically converted into shares of Common Stock Unit shares, with terms identical to those sold in the April Public Offering. As of that date, the convertible note was no longer outstanding. Promissory Note Loan Agreement On July 1, 2024, the Company entered into a Loan Agreement with a third party lender (the Lender ). Under the Loan Agreement, the Lender agreed to loan the Company the principal amount of $0.6 million pursuant to the terms of the promissory note dated July 1, 2024 which was issued to the Lender by the Company (the Promissory Note ). The Promissory Note bears a simple interest rate at 15.0% per annum and matures on the third calendar year from July 1, 2024 (the Maturity Date ) unless due earlier due to an event of a default under the terms of the Promissory Note. The Company agreed to pay annual payments of accrued interest after each calendar year from the Payment Date until any remaining interest is paid in full on the Maturity Date. As of June 30, 2025 and December 31, 2024, the total carrying value of the promissory note, including accrued interest, was $0.6 million. F-21 8. Total Equity Preferred Stock Pursuant to the Second Amended and Restated Certificate of Incorporation filed on September 19, 2023 ( the Amended Articles ), the Company is authorized to issue a total of 1,000,000 shares of preferred stock, par value $0.0001 per share. As of June 30, 2025 and December 31, 2024, there were no shares of preferred stock outstanding. Common Stock Pursuant to the Amended Articles, the Company is authorized to issue 330,000,000 shares of common stock, par value $0.0001 per share, of which 312,000,000 shares are designated as Voting Common Stock ( Common Stock ) and 18,000,000 are designated as Non-Voting Common Stock (the Non-Voting Common Stock ). As of June 30, 2025 and December 31, 2024, there were 2,876,757 and 1,730,051 shares of common stock issued and outstanding, respectively, and 150,000 shares of non-voting common stock outstanding. Since inception to date, no dividends have been declared or paid. Issuance costs related to common stock issuances during all periods presented were immaterial. During the six months ended June 30, 2025, the Company issued 223,583 shares of common stock through an At The Market Offering, 416,667 shares of common stock in connection with the Company s January Confidentially Marketed Public Offering, 277,084 shares of common stock in connection with the Company s March Registered Direct Offering and Concurrent Private Placement, 227,334 shares of common stock in connection with the exercise of Pre-funded Series G Warrants, and 2,038 shares of common stock pursuant to a release of Restricted Stock Units. During the six months ended June 30, 2024, the Company issued 417 shares of common stock in lieu of cash for certain marketing services, 1,157 shares of common stock in lieu of cash for payment of a commitment fee related to the Company s SEPA agreement, 132 shares of common stock issued to a stockholder as a result of the FLAG Merger, 110,271 shares of common stock issued in connection with the Company s April Offering, 21,408 shares of common stock pursuant to Convertible Note conversion, 89,151 shares of common stock issued in connection with the Company s May Inducement Offer, 4,167 shares of common stock from exercises of warrants, and 16,375 shares of common stock from exercises of pre-funded warrants. As of June 30, 2025 and December 31, 2024, common stock reserved for future issuance consisted of the following: Schedule of Common Stock Reserved June 30, 2025 December 31, 2024 Common stock warrants outstanding 1,403,320 910,299 Common stock options issued and outstanding 130,686 77,245 Restricted stock units vested and unreleased 2,039 Shares available for future issuance under the 2023 Equity Incentive Plan 8,099 7,409 Shares reserved under the 2023 Employee Stock Purchase Plan 32,815 32,815 Common stock reserved for future issuance 1,574,920 1,029,807 April 2024 Public Offering On April 18, 2024, in connection with the April Public Offering, the Company sold an aggregate of 110,271 Common Stock Units and 16,375 Pre-Funded Warrant ( PFW ) Units at an effective combined purchase price of $48.00 per Common Stock Unit or PFW Unit. Each Common Stock Unit consists of: (i) one share of the Company s voting common, (ii) a Series A warrant to purchase one share common stock, (iii) a Series B warrant to purchase one Series B Unit, with each Series B Unit consisting of (a) one share of common stock and (b) a Series B-1 Warrant to purchase one share of common stock, and (iv) a Series C warrant to purchase one Series C Unit, with each Series C Unit consisting of (a) one share of common stock and (b) a Series C-1 Warrant to purchase one share of common stock. See further warrant details per each issued series below. F-22 Each PFW Unit consists of: (i) a pre-funded warrant to purchase one share of common stock, (ii) a Series A warrant to purchase one share common stock, (iii) a Series B warrant to purchase one Series B Unit, with each Series B Unit consisting of (a) one share of common stock and (b) a Series B-1 Warrant to purchase one share of common stock, and (iv) a Series C warrant to purchase one Series C Unit, with each Series C Unit consisting of (a) one share of common stock and (b) a Series C-1 Warrant to purchase one share of common stock. See further warrant details per each issued series below. The Company issued the Placement Agent common stock warrants to purchase up to 6,333 shares of Common Stock. See further warrant details below. May 2024 Warrant Inducement Offer On May 31, 2024, following the closing of the May 2024 Warrant Inducement Offer, warrant holders immediately exercised some or all of their respective outstanding Series B Warrants and Series C Warrants to purchase up to an aggregate of 89,153 shares of the Company s Common Stock, Series B-1 Warrants to purchase up to 22,275 shares of Common Stock and Series C-1 Warrants to purchase up to 66,878 shares of Common Stock, at a reduced exercise price of $24.00. In consideration for the immediate exercise of some or all of the Existing Warrants for cash, the Company agreed to issue unregistered new Series D Warrants to purchase up to 89,153 shares of Common Stock. The Company accounted for the exercise price decrease of the Existing Warrants as a modification. Based on the nature of the modification (i.e., reduction in exercise price to induce exercise and raise additional capital), the modification was accounted for as an equity issuance cost on the date the offer was accepted by the Holders, calculated as the excess fair value of the modified warrants post modification. The Company issued the Placement Agent common stock warrants to purchase up to 4,458 shares of common stock. See further warrant details below. Subscription Agreement On July 26, 2024, the Board of Directors of the Company approved a Subscription Agreement dated July 28, 2024 entered with an accredited investor, a related-party. Pursuant to the Agreement, the Company sold to the Investor and the Investor purchased, (i) 58,235 shares of Common Stock at a purchase price of $17.172 per share; and (ii) warrants to purchase 50,000 shares of the Company s common stock at an exercise price of $22.80, for an aggregate purchase price of $1.0 million. At the Market Offering On October 11, 2024, the Company entered into an At The Market Offering Agreement with Ladenburg Thalmann & Co. Inc. ( Ladenburg ), under which the Company may, from time to time, in its sole discretion, issue and sell through Ladenburg, acting as agent or principal, shares of the Company s common stock, par value $0.0001 per share, initially having an aggregate offering price of up to $5.1 million. Pursuant to the Sales Agreement, Ladenburg may sell the Shares by any method permitted by law deemed to be an at the market offering as defined in Rule 415 under the Securities Act of 1933, as amended (the Securities Act ). Ladenburg will use commercially reasonable efforts consistent with its normal trading and sales practices to sell the Shares from time to time, based upon instructions from the Company (including any price or size limits or other customary parameters or conditions the Company may impose). The Company will pay Ladenburg a cash commission of 3.0% of the aggregate gross sales proceeds of shares sold through Ladenburg under the Sales Agreement. The Company also agreed to reimburse Ladenburg for certain specified expenses, including the fees and disbursements of its counsel, in an amount not to exceed $50,000, in addition to certain ongoing disbursements of its legal counsel up to $7,500 in connection with diligence bring downs. F-23 Under the terms of the Sales Agreement, the Company may also sell shares to Ladenburg as principal for its own account at prices agreed upon at the time of sale. If the Company sells shares to Ladenburg as principal, it will enter into a separate terms agreement with Ladenburg in substantially the form attached to the Sales Agreement. The Company is not obligated to sell any shares under the Sales Agreement.
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@@ -0,0 +1 @@
+II-1 In October 2023, the Registrant entered into a warrant exercise inducement offer letter with a holder of certain existing warrants to purchase common stock (the Existing Warrants ) to receive new warrants (the Inducement Warrants ) to purchase up to a number of shares of common stock equal to 200% of the number of warrant shares issued pursuant to the exercise of such Existing Warrants to purchase shares of common stock, pursuant to which the warrant holder agreed to exercise for cash its Existing Warrants to purchase up to 752 shares of the Registrant s common stock, at $3,200.00 per share, in exchange for the Registrant s agreement to issue Inducement Warrants to purchase up to 1,503 shares of the Registrant s common stock. On January 29, 2024, the Registrant entered into a warrant amendment agreement pursuant to which it agreed, subject to stockholder approval, to amend the Inducement Warrants to purchase up to an aggregate of 1,503 shares of common stock at an exercise price of $3,200.00 per share and a termination date of October 16, 2028, so that the amended warrants will have a reduced exercise price of $705.00 per share and a new termination date of February 1, 2029. The requisite stockholder approval for the amendments was obtained at the Registrant s 2024 Annual Meeting of Stockholders held on April 30, 2024. On June 14, 2024, the Registrant issued to investors unregistered warrants to purchase up to an aggregate of 7,320 shares of common stock (the Series C Common Warrants). Subject to certain ownership limitations, each of the Series C Common Warrants was immediately exercisable, has an exercise price of $181.00 per share, and will expire five years from the date of issuance (issued June 17, 2024). On June 26, 2024, the Registrant issued to investors unregistered warrants to purchase up to an aggregate of 11,360 shares of common stock (the Series D Common Warrants). Subject to certain ownership limitations, each of the Series D Common Warrants was immediately exercisable, has an exercise price of $122.50 per share, and will expire five years from the date of issuance (issued June 27, 2024). On July 5, 2024, the Registrant issued to investors unregistered warrants to purchase up to an aggregate of 28,500 shares of common stock (the Series E Common Warrants). Subject to certain ownership limitations, each of the Series E Common Warrants was immediately exercisable, has an exercise price of $63.00 per share, and will expire five years from the date of issuance (issued July 5, 2024). On July 29, 2024, the Registrant entered into Exclusive License Agreement and Stock Purchase Agreement (collectively, the Cortice Agreements ) with Cortice Biosciences, Inc. ( Cortice ) pursuant to which Cortice granted the Company an exclusive license to the intellectual property rights related to certain patents around the compound TPI 287 in the United States, Canada, Mexico and Japan. Pursuant to the Cortice Agreements, the Company agreed to issue Cortice 11,468 shares of Company common stock upon the closing of the transaction, and 867 shares of Company common stock upon the receipt of shareholder approval of such issuance as required by the rules of the Nasdaq Stock Market. The Company also agreed to make milestone payments to Cortice in either cash or shares of Company common stock (at Cortice s option) upon: (i) meeting the primary endpoint a pivotal trial for a licensed product either $15.0 million or 8,223 shares of Company common stock; (ii) FDA acceptance of an New Drug Application for a licensed product either $30.0 million or 16,446 shares of Company common stock; (iii) the first commercial sale in the United States of a licensed product either $45.0 million or 24,668 shares of Company common stock; and (iv) the first commercial sale in Japan of a licensed product either $10.0 million or 4,112 shares of Company common stock. The Company s obligation to pay the above milestones in Company common stock is subject to the receipt of shareholder approval as required by the rules of the Nasdaq Stock Market. The Company also agreed to pay Cortice royalties on sales of licensed products of between 3.0%-7.5%. Finally, to the extent Cortice is required to pay any milestone payments to the original holder of the intellectual property rights licensed, the Company has agreed to make such payments to Cortice. All of the securities above were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act or Regulation D promulgated thereunder. The issuance of the Inducement Warrants was made in reliance on the exemption provided by Section 3(a)(9) of the Securities Act. II-2 Item 16. Exhibits and Financial Statement Schedules. (a) Exhibits: Exhibit Number Description of Document 1.1* Form of Placement Agency Agreement (incorporated by reference to Exhibit 1.1 to the Company s Form S-1 filed with the Commission on April 14, 2025) 3.1 Amended and Restated Articles of Incorporation of CNS Pharmaceuticals, Inc. (incorporated by reference Exhibit 2.1 to the Company s Form 1-A file no. 024-10855) 3.2 Certificate of Amendment to the Amended and Restated Articles of Incorporation of CNS Pharmaceuticals, Inc., filed with the Secretary of State of the State of Nevada (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed with the Commission on November 28, 2022) 3.3 Certificate of Amendment to the Amended and Restated Articles of Incorporation of CNS Pharmaceuticals, Inc., filed with the Secretary of State of the State of Nevada (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed with the Commission on May 3, 2024) 3.4 Certificate of Amendment to the Amended and Restated Articles of Incorporation of CNS Pharmaceuticals, Inc., filed with the Secretary of State of the State of Nevada (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed with the Commission on June 5, 2024) 3.5 Amended and Restated Bylaws of CNS Pharmaceuticals, Inc. (incorporated by reference to Exhibit 3.1 to the Company s Form 8-K filed August 15, 2023) 4.1
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diff --git a/parsed_sections/prospectus_summary/2025/COOTW_australian_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/COOTW_australian_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..a2582d5c11cdfd59a86d015e299c6b37b2d928e6
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+requirements. See Summary of the Prospectus - Emerging Growth Company, and Summary of the Prospectus -Controlled Company, respectively. Investing in our securities involves a high degree of risk. You should carefully review the risks and uncertainties described in the section titled Risk Factors beginning on page 6 of this prospectus, and under similar headings in any amendments or supplements to this prospectus. None of the U.S. Securities and Exchange Commission or any state securities commission has approved or disapproved of the securities or determined if this prospectus is accurate or adequate. Any representation to the contrary is a criminal offense. The date of this prospectus is __, 2025. TABLE OF CONTENTS Page ABOUT THIS PROSPECTUS ii MARKET AND INDUSTRY DATA ii CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS iii SUMMARY OF THE PROSPECTUS 1
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diff --git a/parsed_sections/prospectus_summary/2025/COPR_idaho_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/COPR_idaho_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..302c7751c4c481e393c836a26644fd1ad5f33a2a
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary provides an overview of selected information and does not contain all of the information you should consider before investing in our securities. You should read the entire prospectus carefully, especially the Risk Factors, and our financial statements and the accompanying notes to those statements, included elsewhere in this prospectus, before making an investment decision. Unless otherwise stated or the context otherwise requires, the terms Idaho Copper, the Company, we, us and our refer to Idaho Copper Corporation and its wholly owned subsidiary, International CuMo Mining Corporation. Company Overview Idaho Copper Corporation is a mineral exploration and development company, focused on exploring and developing a large copper-molybdenum-silver deposit in Idaho (United States), (the CuMo Project ). The CuMo Project currently consists of one hundred and twenty-six (126) federal unpatented lode mining claims, and six (6) patented mining claims. In total, the project comprises approximately 2,640 acres. The unpatented lode mining claims and patented claims are situated in Boise County, Idaho, spanning Sections in Township 7N and 8N, Range 5E and 6E, Boise Meridian. Idaho Copper seeks to capitalize on the looming copper supply deficit by advancing one of the potentially largest untapped copper projects in the United States. The economics of the project benefit from extensive high-value co-products including molybdenum and silver. A Preliminary Economic Assessment (PEA) was completed in May 2020 by SRK Consulting (Canada) Inc. 1 The CuMo Project currently consists of one hundred and twenty-six (126) federal unpatented lode mining claims, and six (6) patented mining claims. In total, the project comprises approximately 2,640 acres. The unpatented lode mining claims and patented claims are situated in an unorganized mining district, in Boise County, Idaho, spanning Sections in Township 7N and 8N, Range 5E and 6E, Boise Meridian. The CuMo deposit is situated within the Idaho batholith and is part of a regional scale belt of porphyry and related deposits identified as the Idaho-Montana Porphyry Belt. Igneous complexes in this belt are interpreted to be related to an Eocene, intra-arc rift, and are characterized by alkalic rocks in the northeast, mixed alkalic and calc-alkalic rocks in the middle, and calc-alkaline rocks in the southwest. The CuMo deposit is located at the southwestern end of this belt and is associated with a calc-alkalic monzogranite, reported as 45-52Ma age that intrudes Cretaceous equigranular intrusive rocks of the Atlanta Lobe of the Idaho Batholith. The CuMo area is underlain by biotite granodiorite, the most common rock type of the Atlanta lobe of the Idaho batholith. All of the felsic intrusive phases contain molybdenite (MoS2) mineralization. Ore Sorting and Updated Preliminary Economic Assessment Idaho Copper presently is investigating the potential to utilize additional ore sorting technologies to optimize the separation of waste and low grade ore from higher grade mill feed post-mining and increase the head grade of ore being fed to a concentrator. The thin-veined, stockwork nature of the CuMo deposit lends itself well to ore sorting, since mineralized veins at CuMo largely carry the metals of interest and are much different from waste in appearance. A visual scanning exercise of all of the core recovered from previous drilling activities described herein revealed that up to 84% of the waste and lower grade ore mined can be theoretically separated from higher grade material through application of ore sorting, versus the 28% separation factor that SRK Consulting (Canada) Inc. ( SRK ) conservatively used in its 2020 Preliminary Economic Assessment ( PEA ). There are over 90 active mines in the world today which utilize some form of ore sorting. Competitive Position in the Industry The mineral exploration, development, and production industry are largely un-integrated. The Company competes with other exploration companies looking to acquire and obtain financing for the exploration and development of mineral resource properties. While the Company competes with other exploration companies to locate and acquire mineral resource properties, it may also compete with them for the removal or sales of mineral products from its properties if it should eventually discover their presence in quantities sufficient to make production economically feasible. Readily available markets for the sale of mineral products only sometimes exist for all mineral commodities; however, the principal CuMo Project commodities of copper, silver and molybdenum are traded on international exchanges and therefore, at a minimum a terminal market exists for which these commodities can be delivered and sold. Recent Developments On September 12, 2025, International Energy & Mineral Resources Investment Company Limited ( IEMR ), a shareholder of the Company, filed a lawsuit in the Fourth Judicial District of Idaho seeking a declaratory judgment that the Lock-Up Agreement dated December 21, 2022, and its First Amendment dated March 30, 2024 (collectively, the Lock-Up Agreement ) have terminated according to their terms and that IEMR may freely trade its shares. The Company maintains that IEMR remains subject to the restrictions of the Lock-Up Agreement and filed its response to the lawsuit on September 30, 2025. Corporate Information Our principal executive offices are located at 800 W. Main St., Suite 1460, Boise, ID 83702. Our telephone number is 208-274-9220. Our website address is www.idaho-copper.com. Information contained in, or that can be accessed through, our website is not incorporated by reference into this prospectus, and you should not consider information on our website to be part of this prospectus. Summary of Risk Factors Risks Associated with our Mining Business It is uncertain whether the Company s mineral properties contain any proven or probable reserve, nor can the Company provide such assurance, but its business is highly dependent on the existence of the mineral property. Due to the speculative characteristics of the mine exploration business, there is substantial risk that the Company will not find sufficient commercially exploitable minerals and fail in its business. Even if the Company does eventually discover a mineral reserve on one or more of its properties, there can be no assurance that it will be able to develop such properties into producing mines and extract those resources. Both mineral exploration and development involve a high degree of risk and few properties which are explored are ultimately developed into producing mines. The Company cannot provide any assurance about financing for additional exploration. If its exploration costs are higher than anticipated, the Company may only be able to complete the exploration program with additional financing. If the Company cannot raise sufficient capital after it establishes the existence of a mineral resource on any of its properties in a commercially exploitable quantity, it will not be able to exploit the resource, thus the business could fail. Mineral exploration and development are subject to extraordinary operating risks. The Company does not currently insure against these risks. In the event of a cave-in or similar occurrence, its liability may exceed its resources, which would have an adverse impact on the business. Mineral prices are subject to dramatic and unpredictable fluctuations. The unpredictable inclement weather may restrict mineral exploration and cause delay or impact on the Company s mining progress. Risks Associated with our Capital Structure If our business plan is not successful, the Company may not be able to continue operations as a going concern and shareholders may lose their entire investment in the Company. We could face significant penalties for our failure to comply with the terms of our outstanding convertible notes. You may experience dilution of your ownership interests because of the future issuance of additional shares of Common Stock or other securities that are convertible into or exercisable for Common Stock or preferred stock. The Company does not have a class of securities registered under Section 12 of the Exchange Act. Until it does, or the Company becomes subject to Section 15(d) of the Exchange Act, it will be a voluntary filer. Shares of Common Stock are subject to the penny stock rules of the SEC, and the trading market in the Company s securities is limited, which makes transactions in its stock cumbersome and may reduce the value of an investment in its stock. Because the Company does not intend to pay any cash dividends on shares of Common Stock, its stockholders will not be able to receive a return on their shares unless they sell them. The Company s principal stockholders and management own a significant percentage of Common Stock and will be able to exercise significant influence over matters subject to stockholder approval. Risks Related to Regulatory and Permitting Requirements in the Industry the Company Operates Mineral operations are subject to applicable law and government regulation. Even if the Company discovers a mineral resource in a commercially exploitable quantity, applicable laws and regulations could restrict or prohibit the exploitation of that mineral resource. Exploration development and exploitation activities are subject to comprehensive regulation and permitting, which may cause substantial delays or require capital outlays in excess of what is currently anticipated, causing a material adverse effect on the business. In addition, legal challenges from non-governmental organizations (NGO s) can affect permitting timelines and prevent or extend timing of Company activities for exploration and exploitation. The Company depends on its senior management team, and the loss of one or more key employees or an inability to attract and retain highly skilled employees could adversely affect the business. Risks Related to this Offering The price of our common stock may be volatile. If our listing application for our Common Stock is not approved by NYSE American, we will not be able to consummate the offering and will terminate the offering. The market price of our Common Stock may be highly volatile, and you could lose all or part of your investment. If you purchase our Common Stock in the offering, you will suffer immediate and substantial dilution of your investment. We have broad discretion in the use of our net proceeds from the Common Stock sold in the offering and may not use them effectively. Implications of Being a Smaller Reporting Company We qualify as a smaller reporting company, as such term is defined in Rule 12b-2 under the Exchange Act, and to the extent we continue to qualify as a smaller reporting company certain of the exemptions available to us may continue to be available to us as a smaller reporting company, including: (1) not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act of 2022 (the Sarbanes-Oxley Act ); (2) scaled executive compensation disclosures; and (3) the ability to provide only two years of audited financial statements, instead of three years. 2 THE OFFERING Common Stock offered by us: 781,250 shares of common stock (as adjusted for the proposed 1:20 reverse stock split) Public offering price: It is currently estimated that the initial public offering price will be $6.40 (as adjusted for the proposed 1:20 reverse stock split) per share. Outstanding
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diff --git a/parsed_sections/prospectus_summary/2025/COSM_cosmos_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/COSM_cosmos_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/CV_capsovisio_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/CV_capsovisio_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..3fdf5868546230fcdc3cd4dc7e43541cc4b7dece
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information that you should consider before deciding to invest in our common stock. You should read this entire prospectus carefully, including the Risk Factors section, our historical financial statements and the notes thereto, each included elsewhere in this prospectus. Unless otherwise indicated or the context requires otherwise, the words we, us, our, the Company, or our Company, and CapsoVision refer to CapsoVision, Inc., a Delaware corporation. Overview We are a commercial-stage medical technology company that develops advanced imaging and artificial intelligence ( AI ) technologies that are deployed in our capsule endoscopy solutions to identify abnormalities of the gastrointestinal ( GI ) tract for diagnostic and screening purposes. We developed our first capsule endoscope system, currently comprising the CapsoCam Plus single-use capsule and the CapsoCloud and CapsoView software, to panoramically visualize the small-bowel mucosa to investigate abnormalities such as obscure GI bleeding and Crohn s disease. The capsule acquires and stores video images in onboard memory while moving through the GI tract, and the software component allows healthcare providers to view the video retrieved from the capsule either by streaming it from the cloud, where it is securely stored, to anywhere, at their convenience, using our CapsoCloud software, or downloading it from the capsule themselves and reviewing it in our CapsoView software. The CapsoCam is a wire-free capsule endoscopy solution, eliminating patient-worn data recorders and providing clinicians a zero-capex, maintenance-free, flexible, and scalable workflow. The CapsoCam Plus is classified as a Class II device and has received FDA marketing authorization through the 510(k)-clearance process. We are (i) in the process of updating CapsoCam Plus to add our self-developed AI assisted reading technology and (ii) targeting related FDA 510(k) and EU submissions in the second half of 2025 and clearance of the updated capsule by the end of 2025, with commercialization shortly thereafter. Our AI assisted reading tools detect and highlight suspected abnormalities for a clinician, reducing their time to review the video and making capsule endoscopy more financially attractive to their practice. Our 510(k) submission and FDA review thereof may be delayed and we may not receive 510(k) clearance from the FDA on a timely basis or at all. We began sales of our small-bowel capsule system to our provider customers (i.e., primarily gastroenterologists practicing in clinics and/or hospitals) both internationally (in 2012) and in the U.S. (in 2017) through our global sales and marketing team. In the U.S., we sell to customers directly. Internationally, we sell both directly and through qualified exclusive distributors in specified regions. Our largest international markets (based on shipping destination) are France, Germany, and Canada. In 2023, we established a direct sales team in Germany to better serve our customers and strengthen our market presence in this key market. We plan to (i) further grow our existing sales and marketing team to increase small-bowel-related sales and (ii) leverage our existing sales and marketing team to sell future product additions to our GI-tract capsule endoscopy solution. Our revenue has increased in each year since we began U.S. direct sales in 2020. Our revenues for the years ended December 31, 2023 and 2024 totaled approximately $9.8 million and $11.8 million, respectively, representing a year-over-year growth of approximately 21%. Our revenues for the three months ended March 31, 2024 and 2025 totaled approximately $2.5 million and $2.8 million, respectively, representing a year-over-year growth of approximately 12%. The primary driver for our revenue growth was an increase in the number of CapsoCam Plus capsules sold: an increase of 19% from 2023 to 2024 and 11% from the three month period ended March 31, 2024 to the three month period ended March 31, 2025, with an increase in unit sales of 26% in the U.S. and 4% internationally from 2023 to 2024 and 10% in the U.S. and 13% internationally from the three month period ended March 31, 2024 to the three month period ended March 31, 2025. In 2023 and 2024, Table of Contents The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell, nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. Subject to Completion Dated June 26, 2025 PRELIMINARY PROSPECTUS 5,250,000 Shares CapsoVision, Inc. Common Stock This is the initial public offering of CapsoVision, Inc. We are offering 5,250,000 shares of our common stock, par value $0.001 per share. Prior to this offering, there has been no public market for shares of our common stock. We anticipate the initial public offering price will be between $5.00 and $5.50 per share. As of the date of this prospectus, we have received indications of interest from 38 of our existing stockholders and 45 additional potential investors (primarily potential investors known by or recommended by our existing stockholders) introduced by us to the underwriters (each, an Indicating Potential Investor ) to purchase shares of our common stock in this offering totaling approximately $19.4 million (including approximately $15.1 million in indications of interest from existing Company stockholders). These indications of interest represent in the aggregate approximately 70% of the shares of common stock to be sold in this offering, assuming an offering price of $5.25 per share (the midpoint of the estimated price range set forth above). With limited exception, these Indicating Potential Investors are not company directors, officers or 5% stockholders and none of these Indicating Potential Investors will beneficially own more than 5% of our outstanding shares of common stock following the completion of this offering. These indications of interest and similar indications from other investors we may introduce to the underwriters are not binding agreements or commitments to purchase shares of our common stock in this offering and the underwriters may determine to sell more, fewer or no shares of our common stock in this offering to the Indicating Potential Investors or other investors introduced by us. Also, the Indicating Potential Investors and the other potential investors may determine to purchase more or fewer shares than indicated or no shares of our common stock in this offering. The underwriters will receive the specified underwriting discounts and commissions for shares of our common stock purchased by investors introduced by us (including the Indicating Potential Investors). Unless purchased by a Company officer, director or 10% stockholder, the shares of common stock purchased in this offering will not be subject to the underwriter lock-up described herein. See Security Ownership of Certain Beneficial Owners and Management and Underwriting. In connection with this offering, we have applied to have shares of our common stock listed on the Nasdaq Capital Market ( Nasdaq ) under the symbol CV . There can be no assurance that such application will be approved. If shares of our common stock are not approved for listing on Nasdaq, we will not consummate this offering. We are an emerging growth company and a smaller reporting company as defined in the federal securities laws and will be subject to reduced public company reporting requirements. See Prospectus Summary Implications of Being an Emerging Growth Company and Prospectus Summary Implications of Being a Smaller Reporting Company. An investment in shares of our common stock is highly speculative, involves a high degree of risk and should be considered only by persons who can afford the loss of their entire investment, see Risk Factors beginning on page 15 of this prospectus before you make your decision to invest in our common stock. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Share Total Initial public offering price(1) $ $ Underwriting discounts and commissions(2) $ $ Proceeds to us, before expenses $ $ (1) Assuming an initial public offering price is $ , the midpoint of the range set forth on the cover page of this prospectus. (2) See the section titled Underwriting beginning on page 162 for additional information regarding compensation payable to the underwriters. In addition to the underwriting discounts and commissions referred to in the table above, we have agreed to issue, upon closing of this offering, warrants to the representative of the underwriters to purchase 3% of the total number of shares of common stock sold in this offering at a per share price equal to 125% of the public offering price (the Representative s Warrants ). The registration statement of which this prospectus is a part also covers the Representative s Warrants and the shares of common stock issuable upon the exercise thereof. See section entitled Underwriting on page 162 for more information. We have granted to the underwriters an option exercisable for a period of 30 days from the closing of this offering to purchase up to 787,500 additional shares of our common stock from us at the initial public offering price, less the underwriting discounts and commissions, solely to cover over-allotments, if any. The underwriters expect to deliver the shares of common stock to investors on or about , 2025. Joint Book-Running Managers The Benchmark Company Roth Capital Partners The date of this prospectus is , 2025. Table of Contents ABOUT THIS PROSPECTUS No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus. You must not rely on any unauthorized information or representations. This prospectus is an offer to sell only the shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date. This prospectus contains estimates, projections, and other information concerning our industry and our business, as well as data regarding market research, estimates, and forecasts prepared by our management or third parties. In particular, there is limited public available data as to the size and growth rates for the broader capsule endoscopy market (including for those medical indications that we seek to address); for the GI-tract medical indications that we and other capsule endoscopy providers seek to target, that portion for which capsule endoscopy is indicated as appropriate for diagnosis, surveillance and screening; assumptions as to Medicare and other third-party payor reimbursement rates; and the impact of various non-capsule competitive products. Information that is based on estimates, forecasts, projections, market research, or similar methodologies is inherently subject to uncertainties, and actual events or circumstances may differ materially from events and circumstances that are assumed in this information. While we believe the market and industry data included in this prospectus are reliable and are based on reasonable assumptions, these data and the industry in which we operate is subject to a high degree of uncertainty and risk due to a variety of factors, including those described in the section titled Risk Factors. These and other factors could cause results to differ materially from those expressed in these estimates, publications, and reports made by third parties or us. Unless otherwise expressly stated, we obtained such industry, business, market, and other data from reports, research surveys, studies, and similar data prepared by market research firms and other third parties, industry and general publications, government data, and similar sources. In some cases, we do not expressly refer to the sources from which this data is derived. In that regard, when we refer to one or more sources of this type of data in any paragraph, you should assume that other data of this type appearing in the same paragraph is derived from the same sources, unless otherwise expressly stated or the context otherwise requires. References provided herein to third-party sources are for convenience and the content of these third-party sources, except to the extent specifically set forth in this prospectus, does not constitute a portion of this prospectus and is not incorporated herein. Forecasts and other forward-looking information with respect to industry, business, market, and other data are subject to the same qualifications and additional uncertainties regarding the other forward-looking statements in this prospectus. See Cautionary Note Regarding Forward-Looking Statements. We expect to effect a reverse stock split of our common stock, at a ratio of one-for-3.33, including a corresponding adjustment to the ratio of the Preferred Stock Conversion (as defined below) and adjustment to our outstanding warrants, no later than immediately prior to the completion of this offering. No fractional shares will be issued in connection with the reverse stock split. Share information (including options to acquire shares and the related exercise price) presented in this prospectus and the registration statement of which this prospectus forms a part, other than where noted and in our financial statements and the notes thereto and other historical discussions, have been adjusted to give effect to such reverse stock split. Table of Contents international sales accounted for 26% and 23% of total revenue. In the three-month periods ended March 31, 2024 and 2025, international sales accounted for 23% of total revenue. As of March 31, 2025, our small bowel capsule has been used in more than 135,000 patients worldwide and for 2024 our customer retention rate was approximately 90%. All of our revenues to date have been, and in the near-term will continue to be, generated from CapsoCam Plus related sales for the small bowel; and our ability to grow our small-bowel-related revenue is subject to our ability to successfully and timely execute related elements of our revenue growth strategy, including being able to compete effectively against our competitors (including those with an existing FDA-cleared product and that have established a market presence). To expand beyond small-bowel-related sales, we are developing our next pipeline capsule endoscope product, CapsoCam Colon. Our CapsoCam Colon capsule (i) leverages CapsoCam Plus s existing capsule design with its panoramic view and (ii) incorporates both our self-developed AI to automatically detect polyps in the video and our polyp-size measurement tool enabled by a 3D sensor in the capsule (polyp size being highly correlated with a polyp s risk of becoming cancer). Based on our current regulatory development plan, we are targeting CapsoCam Colon revenues beginning, in the U.S., in the second half of 2026 after receiving FDA 510(k) clearance, and in the EU, in early 2027 after receiving a CE Mark, of our second generation of CapsoCam Colon system, designed with a larger field of view and better image quality to improve accuracy, and which would be classified as a Class II device. On June 10, 2025, we submitted to the FDA our 510(k) for the first generation of our CapsoCam Colon and it has been accepted for review. FDA review of our 510(k) submissions may be delayed and we may not receive 510(k) clearances from the FDA on a timely basis or at all. Longer term, we believe our CapsoCam family of products, incorporating our panoramic imaging solution, can be adapted to address new GI medical indications. Potential new medical indications include esophageal medical conditions (such as esophageal varices and Barrett s esophagus) and pancreatic cancer. We plan to commence feasibility studies of CapsoCam s accuracy in (i) screening esophageal varices (i.e. enlarged blood veins in the esophagus) in cirrhotic patients with portal hypertension in the second half of 2025 and (ii) detecting abnormalities indicative of cancerous and precancerous pancreatic neoplasia (abnormal cell growth) in the first half of 2026, in each case, subject to timely availability of sufficient funding and liquidity and/or potential adjustment of our clinical development priorities. Our ability to pursue our growth strategies (as described below) is subject to our ability to timely and successfully meet our cash and liquidity needs (through this offering, cash generated from operations and the issuance of additional equity securities or borrowings). These efforts may be adversely impacted by our history of operating losses, accumulated deficit, and substantial doubt about our ability to continue as a going concern qualification as stated in the footnotes to our financial statements. Market Overview Overview and Challenges of Visualizing Small Bowel and Detecting Small Bowel Pathologies Diseases of the small bowel include obscure GI bleeding, chronic iron-deficiency anemia, Crohn s disease, tumors, and polyposis. Obscure GI bleeding is recurrent or persistent GI bleeding of uncertain origin. 5% of all GI bleeding is obscure GI bleeding. In approximately 80% of obscure GI bleeding cases, the origin is localized to the small bowel.1 Chronic iron-deficiency anemia is a condition in which blood lacks adequate healthy red blood cells. Crohn s disease is a type of inflammatory bowel disease that causes swelling and irritation of the tissues, called inflammation, in the digestive tract. Capsule endoscopy is the first-line modality for imaging the mucosa of the small bowel including the pathologies characterizing these diseases. Various methods of enteroscopy for reaching the entirety of the small 1 Lee, Bo-In (2022). Indications and Contraindications of Small-bowel Capsule Endoscopy. In: Chun, H.J., Seol, SY., Choi, MG., Cho, J.Y. (eds) Small Intestine Disease. Springer, Singapore. Table of Contents CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS This document contains forward-looking statements. In addition, from time to time, we or our representatives may make forward-looking statements orally or in writing. We base these forward-looking statements on our expectations and projections about future events, which we derive from the information currently available to us. Such forward-looking statements relate to future events or our future performance, including: our financial performance and projections; our growth in revenue and earnings; and our business prospects and opportunities. You can identify forward-looking statements by those that are not historical in nature, particularly those that use terminology such as may, should, expects, anticipates, contemplates, estimates, believes, plans, projected, predicts, potential, or hopes or the negative of these or similar terms. In evaluating these forward-looking statements, you should consider various factors, including: our ability to change the direction of the Company; our ability to keep pace with new technology and changing market needs; and the competitive environment of our business. These and other factors may cause our actual results to differ materially from any forward-looking statement. Forward-looking statements are only predictions. The forward-looking events discussed in this document and other statements made from time to time by us or our representatives, may not occur, and actual events and results may differ materially and are subject to risks, uncertainties and assumptions about us. We are not obligated to publicly update or revise any forward-looking statement, whether as a result of uncertainties and assumptions, the forward-looking events discussed in this document and other statements made from time to time by us or our representatives might not occur. While we believe we have identified material risks, these risks and uncertainties are not exhaustive. Other sections of this prospectus describe additional factors that could adversely impact our business and financial performance. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible to predict all risks and uncertainties, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy or completeness of any of these forward-looking statements. You should not rely upon forward-looking statements as predictions of future events. We are under no duty to update any of these forward-looking statements after the date of this prospectus to conform our prior statements to actual results or revised expectations, and we do not intend to do so. Forward-looking statements include, but are not limited to, statements about: our expectations regarding the acceptance of our products by patients and doctors; our expectations regarding the potential market size for our current CapsoCam Plus capsule and CapsoCam Colon (once FDA cleared) and those markets that we may pursue; our plans to increase small bowel capsule sales following recent 510(k) clearance for pediatric use and telehealth supervision and related products currently under development; our expected receipt of and related timing for FDA 501(k) clearance of our CapsoCam Colon and related sales; our plans and efforts to expand into new indications in terms of new GI pathologies and expanded patient populations; our plans and efforts to introduce enhancements and improvements to our products and technologies, including the AI capabilities incorporated into our products; our commercialization capabilities and strategies, including our plans to increase revenues and sales capabilities in and outside the United States (the U.S. ); Table of Contents bowel, which is approximately 20 feet long, are invasive, time consuming, and require a high level of skill from the operator of the endoscope. Enteroscopy is still required for biopsy or to provide certain therapies. For diagnostic visualization, however, capsule endoscopy is preferred given its simplicity, non-invasiveness, and relatively low cost. Our Addressable Market Opportunity in Visualizing Small Bowel and Detecting Small Bowel Pathologies The global capsule endoscopy market for the small bowel is estimated to be approximately $227 million in 2025 and is forecasted to reach approximately $335 million in 2030. The U.S. capsule endoscopy market for the small bowel is estimated to be approximately $87 million in 2025 and is forecasted to reach approximately $126 million in 2030.2 Overview and Challenges of Detecting Colon Polyps A colon polyp is a clump of cells that forms on the lining of the colon. Most colon polyps are harmless, but, over time, some colon polyps develop into colorectal cancer ( CRC ). The size of a polyp is highly correlated with its risk of becoming cancerous. Currently, optical colonoscopy, accompanied by polypectomy and biopsy, is considered the gold-standard for the detection of colorectal polyps and cancers. Each year in the U.S., there are approximately 153,000 new cases of CRC and approximately 53,000 deaths.3 It is widely accepted that CRC is among the most preventable, yet least-prevented cancers. CRC can take up to 10-15 years to progress from a pre-cancerous lesion to metastatic cancer and death. Patients who are diagnosed early in the progression of the disease with pre-cancerous lesions or early-stage cancer are more likely to have a complete recovery and to be treated less expensively. Our Addressable Market Opportunity in Colon Capsule Endoscopy The global colon capsule endoscopy market is estimated to be approximately $213 million in 2025 and is forecasted to reach approximately $311 million in 2030.4 These estimates only consider current products on the market and do not consider advanced products currently in development and/or awaiting approval for introduction into the market. We believe that our CapsoCam Colon, once FDA cleared and commercialized, will be a superior capsule endoscopy system that will expand the market for colon capsule endoscopy. Our Solutions CapsoCam Plus Our CapsoCam Plus capsule endoscopy system is intended for visualization of the small bowel mucosa, to detect abnormalities of the small bowel in adults and children aged 2 years and above. We believe that our CapsoCam Plus is a superior capsule endoscopy system compared to competitor systems, both in how it captures and presents images of the GI tract and the clinical workflow and patient experience that it enables. CapsoCam Colon We have developed our next pipeline product, CapsoCam Colon, for visualization of the colon and detection and measurement of polyps. We believe that our CapsoCam Colon, once FDA cleared, will be a superior capsule 2 Grand View Research, Inc., Capsule Endoscopy Market Estimates & Trend Analysis From 2018 to 2030, an independent report commissioned by CapsoVision, Inc. 3 https://www.cancer.org/cancer/types/colon-rectal-cancer/about/key-statistics.html 4 Grand View Research, Inc., Capsule Endoscopy Market Estimates & Trend Analysis From 2018 to 2030, an independent report commissioned by CapsoVision, Inc. Table of Contents the implementation of our strategic plan for our business and products and technology; our relationships with, and capabilities of, our assembly manufacturers and component suppliers; the protection of our intellectual property (including our AI capabilities) including through patents and trade secret protections; the expected performance of our products; our ability to manage our growth; the anticipated use of proceeds from this offering; our expectations regarding the time during which we will be an emerging growth company under the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ) or smaller reporting company under U.S. securities laws; estimates of our expenses, future revenue, capital requirements, our needs for additional financing, and our ability to obtain additional capital; our ability to continue as a going concern; and our future financial performance. We caution you not to place undue reliance on the forward-looking statements, which speak only as of the date of this prospectus in the case of forward-looking statements contained in this prospectus. Table of Contents endoscopy system compared to competitor systems, both in how it captures and presents images of the GI tract and the clinical workflow and patient experience that it enables. As described below under Our Growth Strategies , we are conducting relevant clinical development activities (including our recently concluded first arm of our pivotal study involving 1,327 patients enrolled at 20 sites throughout the U.S.) and product enhancement activities to position us to commercialize CapsoCam Colon by the second half of 2026. Our Strengths We believe the continued growth of our Company will be driven by the following factors: Sole capsule endoscope with a 360 panoramic view available in the market. We believe only our CapsoCam Plus boasts a 360 panoramic lateral view. It houses four high-resolution cameras around its circumference, and the images from each are stitched into a single panoramic image. Compared to competitive end-view systems, a 360 panoramic lateral view provides a complete view of the GI mucosa unobstructed by folds and with complete coverage of the bending intestine s inner curvature, resulting in demonstrated superior diagnostic yield. Telemedicine-enabled and zero-capex wire-free data collection and remote data analysis. Our CapsoCam is a zero-capex wire-free data collection solution for providers, as it stores the entire video in onboard memory. In December 2024, we received FDA 510(k) clearance for telemedicine supervision (i.e., remote ingestion) of our CapsoCam Plus, allowing patients to ingest our capsule in the comfort of their own homes, under the remote supervision of providers. The CapsoCam solution frees up exam-room schedules for providers and provides flexibility to administer capsules any day at any time. A provider s practice can easily scale to multiple capsules per day with no added cost, and there is no equipment to recover from patients. Our CapsoCam Plus solution includes our cloud-based platform, CapsoCloud, which provides a flexible, trackable, streamlined, and capital-equipment-free workflow for providers in the U.S. It allows clinicians to track procedures and stream in vivo videos anywhere at their convenience, generate reports, store and manage patient data, and transfer data to third-party reading services. We believe at-home procedures and remote analysis via CapsoCloud will be attractive to providers and patients alike, particularly for future screening indications. Automated pathology detection due to usage of AI. CapsoCam Colon (subject to FDA clearance) incorporates deep learning AI for automated pathology detection of polyps, a capability that competitive systems lack. We are targeting making 510(k) and EU submissions in the second half of 2025 and obtaining FDA and EU clearance by the end of 2025 for the use of AI in our CapsoCam Plus capsule. Our AI assisted reading tools detect and highlight suspected abnormalities for a clinician, reducing their time to review the video and making capsule endoscopy more financially attractive to their practice. CapsoCloud continuously acquires consenting patients clinical data, enabling our in-house AI experts to develop ever-improving automated lesion detection and classification. Our 510(k) submission and FDA review thereof may be delayed and we may not receive 510(k) clearance from the FDA on a timely basis or at all. 3D-sensing technology informs follow-on care decisions. Our CapsoCam Colon (subject to FDA clearance) incorporates our proprietary 3D-sensing technology to more accurately measure polyp sizes. Polyp size is highly correlated with its risk of becoming cancer. No other capsule endoscope currently in the market has 3D-enabled measurement capability. With automated pathology detection and the ability to manually review video frames adjacent to an identified polyp, physicians can more confidently decide that patients with small polyps (e.g., less than 6mm) may forgo a follow-on colonoscopy, increasing the utility of the procedure for healthcare providers and patients alike. Experienced leadership team. Our senior management team consists of industry professionals with deep industry expertise across various disciplines, including medical technology, engineering, optics, sales and marketing, finance, operations, data science, AI, and clinical operations and research. Table of Contents Our Growth Strategies Our long-term, lifesaving vision is an ingestible capsule that, in a single convenient non-invasive procedure, screens for multiple cancers esophageal, gastric, pancreatic, small-bowel, and colorectal at early and precancerous stages, utilizing AI to analyze thousands of images captured in the GI tract. We are building towards this goal with a planned succession of FDA-cleared indications, targeting existing and nascent markets. Until then, key elements of our nearer-term growth strategy include: Obtain 510(k) clearance of CapsoCam Colon. We are developing CapsoCam Colon for visualization of the colon and detection and measurement of polyps. In addition to having a 360 panoramic lateral view, CapsoCam Colon incorporates deep learning AI for automated pathology detection of polyps and 3D-sensing technology to more accurately measure polyp sizes. We recently completed analyzing the data collected from the first arm of our pivotal study and, based on the related results, submitted our 510(k) application to the FDA on June 10, 2025 (which has been accepted for review), with two existing capsule endoscopies as predicate devices (one for the capsule and one for the incorporated AI), to the FDA to support 510(k) clearance of CapsoCam Colon for use by currently indicated patients who are a subset of the colorectal cancer screening and surveillance populations. The first arm of our pivotal study involved 1,327 patients enrolled at 20 sites throughout the U.S. Our goal is to obtain FDA 510(k) clearance in Q1 2026. To enhance the sensitivity and specificity of CapsoCam Colon for detecting and measuring polyps, we are developing our second-generation CapsoCam Colon capsule, which will include improvements such as a new lens and illumination optics with an increased field of view and improved image quality, and are extending our pivotal study to include a second arm, which is expected to involve approximately 300 patients enrolled at up to 11 sites in the U.S. We plan to use the clinical results of the second arm to support submission to the FDA of a 510(k) application in Q1 2026 with a goal of obtaining 510(k) clearance by the end of Q2 2026. There is no guarantee that the clinical results of any of our clinical trials will demonstrate the requisite performance needed to meet applicable regulatory requirements in order to obtain FDA clearance. Current indications for colon capsule endoscopy are limited to patients with evidence of lower-GI bleeding (such as a positive stool test) for whom the risk of colonoscopy or moderate sedation is significant and for patients who have had an incomplete colonoscopy, with adequate preparation. As a part of this second 510(k) application to increase the population of indicated patients, we intend to seek FDA clearance of expanded indications that remove the requirement for evidence of GI bleeding of lower GI origin for patients with major risks for colonoscopy or moderate sedation. Our 510(k) submission for the second generation of CapsoCam Colon and FDA review of our 510(k) applications may be delayed and we may not receive 510(k) clearances from the FDA on a timely basis or at all. Additionally, we intend to seek EU approval with commercialization by early 2027. Expand clinical use cases and accessories for CapsoCam Plus. In December 2024, we received 510(k) clearance of our CapsoCam Plus for pediatric use in children aged 2 years and above and telemedicine supervision (i.e., remote ingestion). Also, we are currently developing a capsule delivery device (availability expected in 2025) for patients who are unable to swallow the capsule, many of whom are children. The capsule delivery device should enable faster penetration of the newly indicated pediatric market. We are also currently developing a patency capsule (tentative FDA 510(k) submission planned by Q3 2025), which is used primarily with Crohn s disease patients to verify that a capsule endoscope can pass through the GI tract without retention at a stricture, a narrowing of the small bowel which can result from inflammation and scarring associated with Crohn s disease. Continue to improve and innovate our GI-tract capsule endoscopy solution. Our research and development initiatives are focused on introducing enhancements and improvements aimed at increasing the value provided by our GI-tract capsule endoscopy solution. In particular, we are working on improvements to our CapsoCam, including a new lens and illumination optics with an increased field of Table of Contents view, improved image quality and higher peak frame rate. For our AI assisted reading technology, we plan to continue investing to (i) improve the pathology-detection and classification accuracy and the scope of our AI algorithms and (ii) apply AI, including large language models, to streamline the diagnostic and medical-report-generation processes, which in turn improves the efficiency and effectiveness of our healthcare provider customers. We also plan to continue making improvements to our CapsoCloud and CapsoView software. Expand into new indications and clinical use cases beyond small bowel and colon. In the second half of 2025, we plan to commence feasibility studies of our CapsoCam s accuracy in screening esophageal varices in cirrhotic patients with portal hypertension, subject to timely availability of sufficient funding and liquidity and/or potential adjustment of our clinical development priorities. Patients with cirrhosis who develop portal hypertension are at risk for complications, including bleeding from esophageal varices. Portal hypertension is the result of resistance to portal blood flow, which most often occurs in the liver and with increases in portal blood flow. When esophageal varices rupture, bleeding may be severe and life- threatening. There are approximately 5.5 million people in the U.S. with Cirrhosis.5 Up to 85% of cirrhotic patients at some point develop esophageal varices6, a significant clinical stage.7 Esophageal varices is one of the most common causes of acute upper gastrointestinal bleeding. Acute variceal bleeding is a potentially fatal complication of liver cirrhosis and represents an important economic and population health issue.8 We believe that our CapsoCam s panoramic imaging is particularly well suited to visualizing the esophagus and measuring the size of varices, which may translate to significant improvement in sensitivity and staging accuracy. In the first half of 2026, we plan to commence feasibility studies of our CapsoCam s accuracy in detecting abnormalities indicative of cancerous and precancerous pancreatic neoplasia (abnormal cell growth) by visualizing abnormalities of the duodenal papilla, subject to timely availability of sufficient funding and liquidity and/or potential adjustment of our clinical development priorities. A dilated, or unnaturally opened, duodenal papilla is correlated with GI tract content reflux into the pancreas duct and pancreatic neoplasia and may indicate the presence of, or elevated risk of developing, serious abnormalities like pancreatitis or a tumor of the pancreas. The CapsoCam has detected the duodenal papilla (Ampulla of Vater) at a higher rate than non-panoramic systems in prior studies. For example, a 2024 retrospective study was conducted at a single Japanese center with 33 patients ingesting the CapsoCam Plus and another random sample of propensity-score-matched patients ingesting the Medtronic PillCam SB3. Physician video readers observed the duodenal papilla at a significantly higher rate using the CapsoCam Plus (82% vs. 15%, p < 0.001).9 There is currently no effective screening for pancreatic cancer. Risks Relating to Our Business Our business and ability to execute our business strategy are subject to a number of risks of which you should be aware before you decide to buy our securities. In particular, you should consider the following risks, which are discussed more fully in the section entitled Risk Factors : We have a history of net losses and expect to incur additional losses in the foreseeable future. Our 2024 audited financial statements include a footnote raising substantial doubt about our ability to continue as a going concern and, even if this offering is successful, we will likely need to raise additional financing to fund our business and revenue growth plans. 5 https://gi.org/topics/liver-cirrhosis/ 6 Socrate Pallio, et al. Diagnosis and Management of Esophagogastric Varices. Diagnostics 2023, 13, 1031. 7 D Amico G, Pasta L, Morabito A, et al. Competing risks and prognostic stages of cirrhosis: a 25-year inception cohort study of 494 patients. Aliment Pharmacol Ther. 2014; 39:1180 1193. 8 Socrate Pallio, et al. Diagnosis and Management of Esophagogastric Varices. Diagnostics 2023, 13, 1031 9 Hirata, Issei; Tsuboi, Akiyoshi; Matsubara, Yuka; Sumioka, Akihiko; Takasago, Takeshi; Tanaka, Hidenori; Yamashita, Ken; Takigawa, Hidehiko; Urabe, Yuji; Oka, Shiro. Clinical usefulness and acceptability of small-bowel capsule endoscopy with panoramic imaging compared with axial imaging in Japanese patients. DEN Open. 2024 Jun 6 Table of Contents All of our revenues to date have been, and in the near-term will continue to be, generated from CapsoCam Plus small bowel related sales; and growing our small-bowel-related revenue is subject to our ability to successfully and timely execute related elements of our revenue growth strategy. Currently we do not expect CapsoCam Colon-related revenues until the second half of 2026 given the anticipated timing of FDA clearance of our second generation CapsoCam Colon solution. Broad adoption of our CapsoCam Colon solution (once cleared) and growing related revenues depend on, among other things, expanding beyond CapsoCam Colon s initial indicated patient population and a successful completion rate for our capsule colonoscopy, increasing the accuracy of our initial CapsoCam Colon solution; and we may fail to successfully and timely execute related elements of our CapsoCam Colon adoption and revenue growth strategy. Longer term efforts to expand our GI-tract capsule endoscopy solutions beyond small bowel and colon pathologies and medical conditions may not succeed. We may not obtain or may experience delays in obtaining 510(k) clearance for our initial or planned second generation of our CapsoCam Colon capsule endoscopy solution (with improved optics and other components), which would adversely impact our ability to commercialize this product. We may face regulatory challenges and delays in obtaining 510(k) clearance for marketing of those CapsoCam capsules incorporating our self-developed AI assisted reading technology. Any failure or defect in our GI-tract capsule endoscopy solution could harm our reputation, expose us to liability, and reduce our sales. We rely on various suppliers to assist us in the assembly and manufacture of our GI-tract capsule endoscopy solution and sourcing of critical and other components and many of these suppliers are single-source suppliers located in Asia (particularly Taiwan and Japan); any disruption in our supply chain could adversely affect our ability to meet the demand for our products and fulfil our orders. We face substantial geopolitical and trade risks (including a possible trade war and imposition of tariffs and supply chain interruptions) and natural disaster risks associated with our business operations in Asia (particularly Taiwan and Japan). If Medicare and other third-party payors do not approve reimbursement for our products at adequate reimbursement rates, we may be unable to successfully commercialize our products. If we or our distributors fail to comply with regulatory requirements, we may be subject to stringent penalties and our business may be materially adversely affected. Our success will depend on our ability to obtain, maintain, enforce, and protect our intellectual property rights. If we fail to identify our patentable inventions or adequately protect our patent rights, the commercial value of our products, services or technologies may be adversely affected and our competitive position may be harmed. Implications of Being an Emerging Growth Company We qualify as an emerging growth company under the federal securities laws and, therefore, we may take advantage of certain exemptions from various public company reporting requirements, including: a requirement to only have two years of audited financial statements and only two years of related selected financial data and management s discussion and analysis; exemption from the auditor attestation requirement on the effectiveness of our internal control over financial reporting; election not to adopt new or revised accounting standards until they become effective for private companies; Table of Contents reduced disclosure obligations regarding executive compensation; and exemptions from the requirements of holding a non-binding advisory stockholder vote on executive compensation and any golden parachute payments. We may take advantage of these provisions for up to five years or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company if we have more than $1.235 billion in total annual growth revenues, have issued more than $1 billion of non-convertible debt in the past three years, or if we are deemed to be a large accelerated filer under the rules of the Securities and Exchange Commission (the SEC ). We may choose to take advantage of some, but not all, of the available benefits available to emerging growth companies. We have taken advantage of some of the reduced reporting requirements in this prospectus. Accordingly, the information contained herein may be different than the information you receive from other public companies in which you hold stock. In addition, an emerging growth company may delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have elected to avail ourselves of this exemption from new or revised accounting standards and, therefore, we will not be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies. Implications of Being a Smaller Reporting Company We are a smaller reporting company as defined in the Securities Exchange Act of 1934, as amended (the Exchange Act ). We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as (i) the market value of our voting and non-voting common stock held by non-affiliates is less than $250 million measured on the last business day of our second fiscal quarter or (ii) our annual revenue is less than $100 million during the most recently completed fiscal year and the market value of our voting and non-voting common stock held by non-affiliates is less than $700 million measured on the last business day of our second fiscal quarter. If we are a smaller reporting company at the time we cease to be an emerging growth company, we may continue to rely on exemptions from certain disclosure requirements that are available to smaller reporting companies. Specifically, as a smaller reporting company, we may choose to present only the two most recent fiscal years of audited financial statements in our Annual Report on Form 10-K and we are not required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act of 2002, as amended (the Sarbanes-Oxley Act ), and, similar to emerging growth companies, smaller reporting companies have reduced disclosure obligations regarding executive compensation. Company Information We were incorporated under the laws of the State of Delaware on August 1, 2005, under the name Capso Vision, Inc. and changed our name to CapsoVision, Inc. on May 31, 2016. Our principal executive office is located at 18805 Cox Ave, Suite 250, Saratoga, CA 95070. Our website address is CapsoVision.com. The information on or accessible through our website is not part of this prospectus. Table of Contents
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+PROSPECTUS SUMMARY
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+This summary highlights,
+and is qualified in its entirety by, the more detailed information and financial statements included elsewhere in this prospectus. This
+summary does not contain all of the information that may be important to you in making your investment decision. You should read this
+entire prospectus carefully, especially including the Risk Factors section beginning on page 14 and our consolidated financial
+statements and the related notes appearing at the end of this prospectus, before deciding to invest in our common stock.
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+Overview
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+CXApp s platform is a workplace experience platform for enterprise customers. Our technologies and solutions help enterprise customers deliver a comprehensive business journey in a work from-anywhere world for employees, partners, customers and visitors. CXApp offers native mapping, analytics, on-device positioning (or ODP) and applications technologies that aim to bring people together.
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+Our customers use our enterprise solutions in a variety of ways, including, but not limited to, workplace experience, employee engagement, desk and meeting room reservations, workplace analytics, occupancy management, content delivery, corporate communications and notifications, event management, live indoor mapping, wayfinding and navigation.
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+Our enterprise app platform is the intersection of technology, intelligence, automation and experience for today s hybrid workplace and the workplace of the future. We are now building the state-of-the-art CXAI (pronounced Sky ) platform that is anchored on customer experience (CX) and artificial intelligence (AI) to provide transformational experiences across people, places and things.
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+Our workplace experience solution is a software-as-a-service (or SaaS) platform for enterprise. Our technology platform delivers the following core components that work in combination to deliver an incredible experience for companies around the world.
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+ Workplace Experience Our workplace experience solution enhances employee experience by providing organizations with a holistic, location-aware, customer-branded employee app for a more connected workplace. This solution helps organizations provide a frictionless work environment to employees with features such as: hot desk and room booking, indoor navigation with turn-by-turn directions on a digital map, company-wide news feeds, an in-app company directory of colleagues and workplace amenities, as well as bookable opportunities and experiences. Our clients include facilities teams solving space utilization challenges, workplace operations teams building incredible experiences for employees and IT teams focused on streamlining their tech stacks to boost productivity and efficiency.
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+ Hybrid Meeting Our executive briefing solution helps enterprise organization create high-touch, high-value, and personalized customer journeys for in-office, remote and hybrid meetings. Our hybrid solution offering streamlines multi-point customer experiences through one environment with support for multiple meetings and diversified locations, agendas for single or multi-day uses and customizable components for every customer briefing program.
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+ Hybrid Events Our hybrid event solution provides both mobile app and virtual event capabilities to connect tens of thousands of remote and in-person audiences through a fully branded, end-to-end event journey. Our hybrid event platform can host multiple events for enterprise organizations and support ongoing event engagement touchpoints for attendees before, during, and after the event through features such as customizable agendas, real-time activity feeds, instant notifications and more.
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+ Mapping Solutions Our indoor mapping solution helps enterprise organizations add intelligence to complex indoor spaces by integrating business data with geospatially accurate indoor maps to create relevant views of indoor environments. Indoor mapping is integral to supporting location-aware, internet of things (or IoT) enabled smart office touchpoints or devices within the customer s premises. Developers use our mapping solution to bring indoor maps to apps, enabling multiple uses with a single set of maps. This product is intended to serve as a digital twin of a physical space and can be used for facility management, security, customer or worker experiences, asset tracking and more.
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+ Analytics Dashboard Our robust cloud-based analytics dashboards give enterprise organizations insights into how real estate, technology and people interact across the workplace, so they can make business decisions to unlock savings, improve employee experience or optimize services. With our analytics platform, we allow data from multiple sensors and data sources (third-party sensors, native mapping solutions and data) to be visualized for action by workplace operations teams.
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+ On-Device Positioning (or ODP) Our on-device positioning technology, commonly known as blue dot, enables powerful location-based uses and builds upon our mapping offering to give enterprise clients a seamless way to provide navigation assistance within a venue (workplace, event show floor, etc.). Our solution displays a user s precise location and runs on a smartphone, smartwatch or other IoT wearable device and can operate without the internet.
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+The Business Combination and Related Transactions
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+On September 25, 2022, the Company entered into an Agreement and Plan of Merger (the Merger Agreement ), by and among the Company, Inpixon, ( Inpixon ), Legacy CXApp and KINS Merger Sub Inc. ( Merger Sub ). The Merger Agreement provided for, among other things, the merger of Merger Sub with and into Legacy CXApp (the Merger and, together with the other transactions contemplated by the Merger Agreement, the Business Combination ), with Legacy CXApp surviving the Merger as a wholly owned subsidiary of CXApp, in accordance with the terms and subject to the conditions of the Merger Agreement.
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+On March 14, 2023 (the Closing Date ), pursuant to the Merger Agreement, Merger Sub merged with and into Legacy CXApp, with Legacy CXApp surviving the merger as a wholly owned subsidiary of the Company (the Closing ).
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+ 
+
+In connection with Closing, we changed our name from KINS to CXApp Inc. The Business Combination will be accounted for using the acquisition method (as a forward merger), with goodwill and other identifiable intangible assets recorded in accordance with GAAP, as applicable. Under this method of accounting, CXApp is treated as the acquired company for financial reporting purposes. KINS has been determined to be the accounting acquirer because KINS maintains control of the Board of Directors and management of the combined company. For accounting purposes, the acquirer is the entity that has obtained control of another entity and, thus, consummated a business combination.
+
+ 
+
+The
+rights of holders of our common stock and warrants are governed by our amended and restated certificate of incorporation (our certificate
+of incorporation or Charter ), our amended and restated bylaws (the Bylaws ), and the Delaware General
+Corporation Law (the DGCL ), and, in the case of the warrants, the Warrant Agreement, dated as of December 14, 2020,
+by and between KINS and Continental Stock Transfer & Trust Company, as warrant agent (the Warrant Agreement ). See the
+section titled Description of Capital Stock. 
+
+ 
+ 
+
+ 
+
+ 8
+
+ Table of Contents 
+
+ 
+
+ 
+
+ 
+
+March 2025 Securities Purchase Agreement
+
+ 
+
+On March 26, 2025, we entered into a Securities Purchase Agreement (the Avondale Purchase Agreement ) with Avondale Capital, LLC ( Avondale ), providing us with a financing commitment of up to $20,000,000 in the form of one or more prepaid common stock purchases. Under the Avondale Purchase Agreement, we issued and sold to Avondale an initial prepaid purchase in the principal amount of $4,200,000 (the Initial Avondale Pre-Paid Purchase ), and we delivered 80,000 shares of our common stock to Avondale at closing as commitment shares (the Commitment Shares ). The Commitment Shares were issued to Avondale as a financing fee and are being registered for resale hereunder. After an original issue discount of $200,000 and a $10,000 transaction expense payable to Avondale, the net cash proceeds to us from the Initial Avondale Pre-Paid Purchase were $4,000,000.
+
+ 
+
+Each Pre-Paid Purchase under the Avondale Purchase Agreement (the Avondale Pre-Paid Purchase ) is an unsecured prepaid investment that carries a principal balance which can be satisfied (redeemed) by the issuance of common stock to Avondale, at Avondale s election, from time to time. In other words, at any time after the Initial Avondale Pre-Paid Purchase (and subject to a restricted period and the effectiveness of the registration statement of which this prospectus forms a part), Avondale has the right (but not the obligation) to require us to issue and deliver shares of common stock (the Avondale Purchase Shares ) in lieu of cash, as redemption of the outstanding balance of an Avondale Pre-Paid Purchase. The Avondale Purchase Shares will be issued at a per-share price equal to the lower of (i) 120% of the Nasdaq-defined Minimum Price as of the date of the applicable Avondale Pre-Paid Purchase closing, or (ii) 91% of the lowest daily volume-weighted average price (VWAP) of our common stock during the ten (10) consecutive trading days immediately prior to the date on which Avondale elects to receive shares. However, in no event will the Avondale Purchase Share price be lower than a fixed floor price equal to 20% of the applicable Nasdaq Minimum Price. This pricing mechanism means that Avondale will acquire our shares at a discount to the prevailing market price when it elects to convert the prepaid balance into shares, subject to the floor price protection. Each Avondale Pre-Paid Purchase is documented as a separate promissory instrument with its own principal balance and holding period, and does not bear periodic interest.
+
+ 
+
+In addition to the Initial Avondale Pre-Paid Purchase, the Avondale Purchase Agreement allows us, at our discretion, to request one or more additional Avondale Pre-Paid Purchases from Avondale to draw down further funding from the $20 million total commitment, provided certain conditions are satisfied. Such conditions include (among others) that our common stock continues to meet specified minimum trading volume thresholds and that we obtain stockholder approval as required by Nasdaq Listing Rule 5635(d) to issue shares in excess of 19.99% of our outstanding stock (the Exchange Cap ). Each additional Avondale Pre-Paid Purchase (if we choose to request any) will be subject to an original issue discount of 5%, will carry the same 20% floor price protection, and will use a similar pricing formula (with a fixed price component capped at 120% of the Minimum Price at closing of that tranche) for any Avondale Purchase Shares issued thereunder. We are not obligated to request any Avondale Pre-Paid Purchase beyond the initial one, and we retain full discretion to determine if and when to draw on the remaining commitment, subject to the agreement s conditions.
+
+ 
+
+Exchange Cap and Stockholder Approval: Unless and until we obtain the requisite approval of our stockholders under applicable Nasdaq rules, we may not issue in excess of 19.99% of our outstanding common stock (approximately 3.9 million shares based on shares outstanding as of March 2025) pursuant to the Avondale Purchase Agreement. This Exchange Cap applies to the aggregate number of shares issued under all Avondale Pre-Paid Purchases to Avondale. If stockholder approval is not obtained at our upcoming annual meeting (which we have committed to seek by May 31, 2025), then we will be prohibited from issuing any shares above the Exchange Cap, and any portion of the prepaid balance that cannot be converted into shares due to the cap would have to be repaid by us in cash. We have agreed to seek stockholder approval at our 2025 annual meeting to authorize the full issuance of shares under the Avondale Purchase Agreement, and if approval is not obtained at that meeting, to continue to seek approval at subsequent meetings every 90 days until obtained.
+
+ 
+ 
+
+ 
+
+ 9
+
+ Table of Contents 
+
+ 
+
+ 
+
+ 
+
+Registration of Shares: In connection with the Avondale Purchase Agreement, we agreed to file a registration statement with the SEC covering the resale by Avondale of a significant number of shares of common stock. Specifically, we were required to register at least 18,500,000 shares (inclusive of the 80,000 Commitment Shares and the maximum shares potentially issuable under the Initial Avondale Pre-Paid Purchase) within 30 days of the initial closing. We are fulfilling that obligation with the registration statement of which this prospectus is a part. In addition, although the Avondale Purchase Agreement originally contemplated that we would register additional shares in the future as we draw any subsequent tranches (so that the full $20,000,000 commitment would eventually be registered), we have opted to register the full potential amount at this time. Accordingly, this prospectus covers the resale of all shares that may be issued to Avondale under the Avondale Purchase Agreement, including the Commitment Shares, the shares underlying the Initial Avondale Pre-Paid Purchase, and all shares that could be issued under any future Avondale Pre-Paid Purchases (assuming we utilize the entire remaining commitment amount, subject to the Exchange Cap and stockholder approval). By registering these shares now, we aim to ensure that Avondale has the ability to resell any shares we issue to it under the Avondale Purchase Agreement without delay, which was a condition of the financing. Avondale is identified in this prospectus as a Selling Securityholder solely for purposes of reselling the shares of common stock it may acquire; Avondale has no obligation to purchase any additional shares beyond the Initial Avondale Pre-Paid Purchase and the additional draws we may request.
+
+ 
+
+We caution that the actual number of shares of common stock that may be issued to Avondale under the Avondale Purchase Agreement is uncertain and will depend on a variety of factors, including the timing and amount of any additional Avondale Pre-Paid Purchases we elect to draw, the prevailing market price of our common stock at the times Avondale elects to receive Avondale Purchase Shares, and the applicable Avondale Purchase Share prices (which are subject to the formulas and floor price noted above). As a result, Avondale may ultimately receive and resell a substantial number of shares, possibly up to 37 million or more shares, which would significantly increase the number of shares of our common stock outstanding and available for sale in the public market. Such issuances, if they occur, will dilute our existing stockholders and could exert downward pressure on the market price of our stock (see Risk Factors and Dilution below). For example, the 18,500,000 shares being registered for resale in connection with the Avondale Purchase Agreement (including the 80,000 Commitment Shares) would represent nearly all of the number of shares of our common stock outstanding prior to this offering. Investors should be aware that Avondale has an incentive to sell the shares it acquires quickly into the public market, since it will acquire those shares at a discount to market price. This could result in significant volumes of our stock being sold by Avondale over a relatively short period, which may adversely affect our stock price.
+
+ 
+
+We intend to use the
+proceeds that we have received from the Initial Avondale Pre-Paid Purchase and any proceeds we may receive from additional Avondale
+Pre-Paid Purchases for working capital and general corporate purposes. See Use of Proceeds. However, we will
+not receive any proceeds from the resale of shares by Avondale or any other Selling Securityholder under this prospectus.
+
+ 
+ 
+
+ 
+
+ 10
+
+ Table of Contents 
+
+ 
+
+ 
+
+ 
+
+Summary of Risk Factors
+
+ 
+
+In addition to the other information contained in this prospectus, the following risks have the potential to impact the business and operations of CXApp. An investment in our securities involves a high degree of risk. You should consider carefully all of the risks described in this prospectus, together with the other information contained in this prospectus. These risk factors are not exhaustive and all investors are encouraged to perform their own investigation with respect to the business, financial condition and prospects of CXApp. The occurrence of any of the following risks or additional risks and uncertainties not presently known to us or that we currently believe are immaterial could have a material adverse effect on our business, financial condition, results of operations and future growth prospects. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. Such risks include, but are not limited to, the following (See Risk Factors ). Unless the context otherwise requires, all references in this subsection to the Company, we, us, or our refer to the business of CXApp.
+
+ 
+
+ 
+ 
+ 
+ We have a history of operating losses and there is no assurance that we will ever be able to earn sufficient revenue to achieve profitability or raise additional financing to successfully operate our business plan.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ We rely on a limited number of key customers, the importance of which may vary dramatically from year to year, and a loss of one or more of these key customers may adversely affect our operating results.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ We may need additional cash financing and any failure to obtain cash financing, could limit our ability to grow our business and develop or enhance our service offerings to respond to market demand or competitive challenges.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ The issuance of shares of common stock to our financing partners at prices below the prevailing market price has resulted, and will result, in substantial dilution to existing stockholders and could depress the market price of our stock. The potential resale of a large number of these shares could increase the supply of our stock in the market and create additional selling pressure, causing our stock price to decline.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Our competitiveness depends significantly on our ability to keep pace with the rapid changes in our industry. Failure by us to anticipate and meet our customers technological needs could adversely affect our competitiveness and growth prospects.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Our historical financial results and unaudited pro forma combined financial information included in this prospectus is preliminary and the actual financial condition and results of operations after the Merger may differ materially.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ The market price of our common stock may be volatile and fluctuate substantially, which could cause the value of your investment to decline.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ The requirements of being a public company, including compliance with the reporting requirements of the Exchange Act and Nasdaq, require significant resources, increase our costs and distract our management, and we may be unable to comply with these requirements in a timely or cost- effective manner. We will incur increased costs as a result of operating as a public company, and our management will devote substantial time to new compliance initiatives.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ 
+ Under Nasdaq rules, we may not issue shares under the Avondale Purchase Agreement in excess of 19.99% of our outstanding common stock without prior shareholder approval. If we fail to obtain approval by May 31, 2025, we cannot access any tranche above that cap and must repay the excess prepaid balance in cash, which could materially strain our liquidity.
+
+ 
+
+ 
+ 
+
+ 
+
+ 11
+
+ Table of Contents 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Funding of additional tranches under the Avondale Purchase Agreement is subject to market-based conditions including minimum trading volumes and requisite shareholder approval. If we choose not to, or are unable to, satisfy these conditions, we will forfeit the right to draw the remaining commitment and may be forced to secure alternative financing on potentially less favorable terms, which could adversely affect our operations and growth.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Our historical combined financial data and pro forma financial statements are not necessarily representative of the results we would have achieved as a standalone company and may not be a reliable indicator of our future results.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Integration of artificial intelligence into our product offerings and our use of artificial intelligence in our operations could result in reputational or competitive harm, legal liability, and other adverse effects on our business.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ If we fail to meet the continued listing standards of Nasdaq, our common stock may be delisted, which could have a material adverse effect on the liquidity and market price of our common stock and expose the Company to litigation.
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Management has identified material weaknesses in the Company s internal control over financial reporting, which could, if not remediated, result in additional material misstatements in the Company s interim or annual consolidated financial statements.
+
+ 
+
+ 
+
+Emerging Growth Company
+
+ 
+
+CXApp is an emerging growth company, as defined in Section 2(a) of the Securities Act, as modified by the JOBS Act. As such, CXApp is eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile.
+
+ 
+
+In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. CXApp intends to take advantage of the benefits of this extended transition period.
+
+ 
+
+CXApp will remain an emerging growth company until the earlier of: (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of the initial public offering of our securities, (b) in which we have total annual gross revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common equity that is held by non-affiliates exceeds $700 million as of the end of the prior fiscal year s second fiscal quarter; and (2) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company have the meaning associated with it in the JOBS Act.
+
+ 
+
+Smaller Reporting Company
+
+ 
+
+CXApp is a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. CXApp will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of its common equity held by non-affiliates exceeds $700 million as of the prior September 30th or (2) the market value of its common equity exceeds $250 million and its annual revenues exceeds $100 million during such fiscal year.
+
+ 
+ 
+
+ 
+
+ 12
+
+ Table of Contents 
+
+ 
+
+ 
+
+ 
+
+THE OFFERING
+
+ 
+
+ 
+ Shares of common stock Offered by the Selling Securityholders
+ 
+ 
+ 18,500,000 shares of common stock consisting
+of:
+
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 80,000 shares of common stock issued to Avondale as a financing fee pursuant to the Avondale Purchase Agreement
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 18,420,000 shares of common stock issuable in satisfaction of Avondale Pre-Paid Purchases subject to the Avondale Purchase Agreement
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Selling Securityholders
+ 
+ Avondale Capital, LLC. See Selling Securityholders on page 86 of this prospectus.
+
+ 
+ 
+ 
+ 
+
+ 
+ Shares of common stock outstanding prior to this offering
+ 
+ 20,776,997 shares of common stock (as of May 8, 2025)
+
+ 
+ 
+ 
+ 
+
+ 
+ Use of proceeds
+ 
+ We will not receive any proceeds from the sale of shares of common stock by the Selling Securityholders pursuant to this prospectus.
+
+ 
+ 
+ 
+ 
+
+ 
+ Risk factors
+ 
+ You should carefully read the section titled
+ Risk Factors beginning on page 14 and the other information included in this prospectus for a discussion of
+ factors you should consider carefully before deciding to invest in our common stock.
+
+ 
+ 
+ 
+ 
+
+ 
+ Nasdaq symbol for our common stock
+ 
+ CXAI 
+
+ 
+ 
+ 
+ 
+
+ 
+
+ 
+ 
+
+ 
+
+ 13
+
+ Table of Contents 
+
+ 
+
+ 
+
+Risk Factors
+
+ 
+
+You should carefully consider the risks and uncertainties described below and the other information in this prospectus before making an investment in our common stock or warrants. Our business, financial condition, results of operations, or prospects could be materially and adversely affected if any of these risks occurs, and as a result, the market price of our common stock and warrants could decline and you could lose all or part of your investment. This prospectus also contains forward-looking statements that involve risks and uncertainties. See
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/DBGI_digital_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/DBGI_digital_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..3fd89169980b333b93a8fcacce3ac9dae7afaa91
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/DBGI_digital_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 3
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/DEFI_hashdex_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/DEFI_hashdex_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..12ba31804c07f3886ea86746ea0eb87478f17877
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/DEFI_hashdex_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This is only a summary of the prospectus and, while it contains material information about the Fund and its Shares, it does not contain or summarize all of the information about the Fund and the Shares contained in this prospectus which is material and/or which may be important to you. You should read this entire prospectus, including the "Risk Factors" discussion beginning on page [ ], before making an investment decision about the Shares. The Fund The 7RCC Spot Bitcoin and Carbon Credit Futures ETF (the "Fund"), a newly established series of Tidal Commodities Trust I (the "Trust"), is an exchange-traded fund. The Fund issues common shares of beneficial interest (the "Shares"), which represent units of fractional undivided beneficial interest in and ownership of the Fund. Tidal Investments LLC (the "Sponsor"), a Delaware limited liability company, is the Fund s sponsor. The Fund is a commodity pool for purposes of the Commodity Exchange Act of 1936, as amended (the "CEA"), and the Fund and the Sponsor are subject to regulation by the Commodity Futures Trading Commission (the "CFTC") and are registered with the National Futures Association ("NFA"). The Sponsor is registered with the NFA as a commodity pool operator ("CPO") and commodity trading advisor ("CTA"). The Fund is not an investment company as defined in the Investment Company Act of 1940, as amended (the "Investment Company Act"), and is not subject to regulation thereunder. Shareholders do not have the protections associated with ownership of shares in an investment company registered under the Investment Company Act. Offering of the Shares The Shares will be continuously offered under the Securities Act of 1933, as amended (the "Securities Act"). The Fund issues and redeems Shares at net asset value ("NAV") only in large, specified blocks each consisting of 10,000 Shares (each such block of shares called a "Basket," and collectively, the "Baskets"). The Fund s Baskets are generally issued ("Creation Baskets") and redeemed ("Redemption Baskets") for cash, and only to and from broker-dealers and large institutional investors that have entered into participation agreements ("Authorized Purchasers"). Subject to the Exchange receiving the necessary regulatory approval to permit the Fund to create and redeem Shares in-kind for bitcoin (the "In-Kind Regulatory Approval"), these transactions may also take place in exchange for bitcoin. The timing of the In-Kind Regulatory Approval is unknown, and there is no guarantee that the Exchange will receive the In-Kind Regulatory Approval at any point in the future. If the Exchange receives the In-Kind Regulatory Approval and if the Sponsor chooses to allow in-kind creations and redemptions, the Fund will notify the owners of the beneficial interests of Shares (the "Shareholders") in a prospectus supplement, in its periodic Exchange Act reports and on the Fund s website. Investment Objective The Fund s investment objective is to reflect the daily changes of the price in bitcoin and carbon credit futures contracts ("Carbon Credit Futures"), as represented by the 7RCC Kaiko Bitcoin Carbon Credit Index (the "Index"), less expenses from the Fund s operations. There can be no assurance that the Fund will achieve its investment objective or its investment strategy. Investment Strategy The Fund s investment strategy is to hold a combination of bitcoin and Carbon Credit Futures to replicate the performance of the Index. The Fund seeks these investments to reflect the daily changes in the price of bitcoin and Carbon Credit Futures, as represented in the Index. The Index is designed to track the performance of investing in a portfolio comprised of 80% bitcoin and 20% Carbon Credit Futures. The Index s Carbon Credit Futures are linked to the value of emissions allowances issued under the following regimes: the European Union Emissions Trading System ("EU ETS"), the California Cap and Trade ("CCA"), and Regional Greenhouse Gas Initiative ("RGGI"). To obtain exposure to the EU CEA, the Index uses Intercontinental Exchange ("ICE") EUA (Carbon Emission Allowances) futures ("EU CEA Carbon Credit Futures"). To obtain exposure to the CCA, the Index uses ICE California Carbon Allowance Vintage Future contracts ("CCA Carbon Credit Futures"). To obtain exposure to the RGGI, the Index uses ICE RGGI (CO2 allowances) futures contracts ("RGGI Carbon Credit Futures"). The Fund is a passive investment vehicle that does not seek to generate returns beyond tracking the returns of the Index. This means the Sponsor does not speculatively sell bitcoin and/or Carbon Credit Futures at times when prices are high or speculatively acquire such assets at low prices in the expectation of future price increases. Bitcoin and the Bitcoin Network Bitcoin is a digital commodity native to the Bitcoin Network. Bitcoin is not issued by any government, bank or central organization, and instead exist on the Bitcoin Network. Bitcoin transaction and ownership records are reflected on the Bitcoin Blockchain, which is a digital public record or ledger of all transactions completed on the Bitcoin Network. It is widely understood that no single entity owns or operates the Bitcoin Network. The Bitcoin Network is accessed through software, and software governs bitcoin creation, movement and ownership. The infrastructure of the Bitcoin Network is collectively maintained on a distributed basis by the Bitcoin Network s participants, consisting of: (i) validators or "miners," who run special software to validate transactions; (ii) "developers," who maintain and contribute updates to the Bitcoin Network s source code; and (iii) "users," who download and maintain on their individual computer a full or partial copy of the Bitcoin Blockchain and related software. Anyone can be a user, developer, or miner. The value of bitcoin is determined, in part, by the supply of, and demand for, bitcoin in the global markets for the trading of bitcoin, market expectations for the adoption of bitcoin as a decentralized store of value, the number of merchants and/or institutions that accept bitcoin as a form of payment, and the volume of peer-to-peer transactions, among other factors. Regulation Futures Market Regulation The regulation of futures markets, futures contracts, and futures exchanges has historically been comprehensive. The CFTC and the exchanges are authorized to take extraordinary actions in the event of a market emergency including, for example, the retroactive implementation of speculative position limits, increased margin requirements, the establishment of daily price limits and the suspension of trading on an exchange or trading facility. Pursuant to authority in the Commodity Exchange Act ("CEA"), the National Futures Association ("NFA") has been formed and registered with the Commodity Futures Trading Commission ("CFTC") as a registered futures association. At the present time, the NFA is the only self-regulatory organization ("SRO") for commodity interest professionals, other than futures exchanges. The CFTC has delegated to the NFA responsibility for the registration of CPOs and FCMs and their respective associated persons. The Sponsor and the Fund s clearing broker are members of the NFA. As such, they will be subject to NFA standards relating to fair trade practices, financial condition and consumer protection. The NFA also arbitrates disputes between members and their customers and conducts registration and fitness screening of applicants for membership and audits of its existing members. Neither the Trust nor the Fund is required to become a member of the NFA. The regulation of commodity interest transactions in the United States is a rapidly changing area of law and is subject to ongoing modification by governmental and judicial action. Considerable regulatory attention has been focused on non-traditional investment pools that are publicly distributed in the United States. There is a possibility of future regulatory changes within the United States altering, perhaps to a material extent, the nature of an investment in the Fund, or the ability of the Fund to continue to implement its investment strategy. In addition, various national governments outside of the United States have expressed concern regarding the disruptive effects of speculative trading in the commodities markets and the need to regulate the derivatives markets in general. The effect of any future regulatory change on the Fund is impossible to predict but could be substantial and adverse. The CFTC possesses exclusive jurisdiction to regulate the activities of commodity pool operators and commodity trading advisors with respect to "commodity interests," such as futures, swaps, and options, and has adopted regulations with respect to the activities of those persons and/or entities. Under the CEA, a registered commodity pool operator, such as the Sponsor, is required to make annual filings with the CFTC and the NFA describing its organization, capital structure, management and controlling persons. In addition, the CEA authorizes the CFTC to require and review books and records of, and documents prepared by, registered commodity pool operators. Pursuant to this authority, the CFTC requires commodity pool operators to keep accurate, current and orderly records for each pool that they operate. The CFTC may suspend the registration of a commodity pool operator (1) if the CFTC finds that the operator s trading practices tend to disrupt orderly market conditions, (2) if any controlling person of the operator is subject to an order of the CFTC denying such person trading privileges on any exchange, and (3) in certain other circumstances. Suspension, restriction or termination of the Sponsor s registration as a commodity pool operator would prevent it, until that registration were to be reinstated, from managing the Fund, and might result in the termination of the Fund if a successor sponsor is not elected pursuant to the Trust Agreement. Neither the Trust nor the Fund is required to be registered with the CFTC in any capacity. The Fund s investors are afforded prescribed rights for reparations under the CEA. Investors may also be able to maintain a private right of action for violations of the CEA. The CFTC has adopted rules implementing the reparation provisions of the CEA, which provide that any person may file a complaint for a reparations award with the CFTC for violation of the CEA against a floor broker or an FCM, introducing broker, commodity trading advisor, CPO, and their respective associated persons. The regulations of the CFTC and the NFA prohibit any representation by a person registered with the CFTC or by any member of the NFA, that registration with the CFTC, or membership in the NFA, in any respect indicates that the CFTC or the NFA has approved or endorsed that person or that person s trading program or objectives. The registrations and memberships of the parties described in this summary must not be considered as constituting any such approval or endorsement. Likewise, no futures exchange has given or will give any similar approval or endorsement. Trading venues in the United States are subject to varying degrees of regulation under the CEA depending on whether such exchange is a designated contract market (i.e. a futures exchange) or a swap execution facility. Clearing organizations are also subject to the CEA and the rules and regulations adopted thereunder as administered by the CFTC. The CFTC s function is to implement the CEA s objectives of preventing price manipulation and excessive speculation and promoting orderly and efficient commodity interest markets. In addition, the various exchanges and clearing organizations themselves as SROs exercise regulatory and supervisory authority over their member firms. THE FUND INVOLVES A HIGH DEGREE OF RISK AND PRESENTS MANY DIFFERENT RISKS THAN OTHER TYPES OF FUNDS, INCLUDING RISKS RELATED TO THE TAX TREATMENT OF SUCH INVESTMENT, BITCOIN OR INTERESTS RELATED TO BITCOIN OR CARBON CREDIT FUTURES. THE FUND IS RISKIER THAN OTHER EXCHANGE-TRADED PRODUCTS THAT DO NOT HOLD FINANCIAL INSTRUMENTS RELATED TO BITCOIN OR CARBON CREDIT FUTURES. THE FUND MAY NOT BE SUITABLE FOR SHAREHOLDERS THAT ARE NOT IN A POSITION TO ACCEPT MORE RISK THAN MAY BE INVOLVED WITH OTHER EXCHANGE-TRADED PRODUCTS. AS WITH ALL INVESTMENTS, AN INVESTOR IN THE FUND COULD POTENTIALLY LOSE THE FULL PRINCIPAL VALUE OF THEIR INVESTMENT. INVESTING IN SHARES INVOLVES SPEICAL RISKS THAT ARE DESCRIBED IN THE "RISK FACTORS" SECTION BEGINNING ON PAGE [ ] OF THIS PROSPECTUS. Neither the Trust nor the Fund is registered under the Investment Company Act of 1940, as amended (the "Investment Company Act") and therefore neither is subject to regulation thereunder. Shareholders do not have the protections associated with ownership of shares in an investment company registered under the Investment Company Act. See risk factor entitled "Shareholders do not have the protections associated with ownership of shares in an investment company registered under the Investment Company Act" in this Prospectus for more information. NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THE SECURITIES OFFERED IN THIS PROSPECTUS, OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THE COMMODITY FUTURES TRADING COMMISSION ("CFTC") HAS NOT PASSED UPON THE MERITS OF PARTICIPATING IN THIS COMMODITY POOL NOR HAS THE CFTC PASSED ON THE ADEQUACY OR ACCURACY OF THIS DISCLOSURE DOCUMENT. The Trust is an "emerging growth company" as that term is used in the Jumpstart Our Business Startups Act (the "Jobs Act") and, as such, may elect to comply with certain reduced reporting requirements. The Shares are neither interests in nor obligations of the Sponsor, or the Trustee (each as defined herein). The Shares are not insured by the Federal Deposit Insurance Corporation or any other governmental agency. This Prospectus has two parts: a disclosure document and a statement of additional information. These parts are bound together and both contain important information. The date of this prospectus is [ _______, ____]. "Index"—7RCC Kaiko Bitcoin Carbon Credit Index. "Indirect Participants"—Those banks, brokers, dealers, trust companies and others who clear through or maintain, either directly or indirectly, a custodial relationship with a DTC Participant. "Investment Advisers Act"—Investment Advisers Act of 1940, as amended. "Investment Company Act"—Investment Company Act of 1940, as amended. "IRA"—An individual retirement account provided for under Section 408(m) of the Code. "IRS"—The U.S. Internal Revenue Service, a bureau of the U.S. Department of the Treasury. "Kaiko"— Invierno AB, Reg. No. 559207-4172, Box 5193, 10244 Stockholm, Sweden. "Management Fee"—A fee in an amount equal to 0.68% per annum of the daily NAV of the Fund, paid monthly in arrears, in consideration of the Sponsor s services related to the management of the Fund s business and affairs. "Marketing Agent"— Foreside Fund Services, LLC, a wholly-owned subsidiary of Foreside Financial Group, LLC (d/b/a ACA Group), which is engaged by the Sponsor and is responsible for the marketing of the Shares. "Marketing Fee"—Fee payable to the Marketing Agent for services it provides to the Fund, which the Sponsor shall pay to the Marketing Agent as a Sponsor-paid Expense. "NAV"—The net asset value of the Fund. "NFA"—The National Futures Association. "Non-Digital Custodian"— U.S Bank, N.A. "OTC"—Over-the-counter. "Redemption Basket"—Baskets of Shares redeemed in exchange for cash in an amount equal to the Fund s NAV on a per Share basis for each such Redemption Basket. "SEC"—The U.S. Securities and Exchange Commission. "Securities Act"—The Securities Act of 1933, as amended. "Service Providers"—Collectively, the Sponsor, the Trustee, the Bitcoin Advisers, the Transfer Agent, the Administrator, the Custodians, the Marketing Agent and the FCMs. "Shareholder"—Any owner of Shares. "Shares"—Common units of fractional undivided beneficial interest in, and ownership of, the Fund. "SIPC"—The Securities Investor Protection Corporation. "Solactive" — Solactive AG. "Sponsor"—Tidal Investments LLC, a Delaware limited liability company, which is registered as a Commodity Pool Operator. "Sponsor-paid Expense(s)"— The Fund s fees and expenses that the are deducted from the Management Fee: the Marketing Fee, the Administrator Fee, the fees of the Custodians, the Transfer Agent Fee, the Trustee fee, applicable license fees, including the licensing fees related to the Index License Agreement, fees and expenses related to trading of Shares on the Exchange (including marketing, legal and audit fees and expenses), legal expenses, audit fees, regulatory fees, including any fees relating to the registration of the Shares with the SEC, printing and mailing costs and costs of maintaining the Trust s website. "SROs"—Self-regulatory organizations. "Sub-Administrator"— U.S. Bank Global Fund Services ("Global Fund Services"). Bitcoin has only a physical existence in the record of transactions on the Bitcoin Blockchain. The Bitcoin Blockchain is a public record of the creation, custody and flow of funds of bitcoin, showing every transaction effected on the Bitcoin Blockchain among users online "digital wallets" where their bitcoin are effectively stored. Miners authenticate and bundle bitcoin transactions sequentially into files called "blocks," which requires performing computational work to solve a cryptographic puzzle set by the Bitcoin Network s software protocol. Since each solved block contains a reference to the previous block, they form a chronological "chain" back to the first bitcoin transaction. Copies of the Bitcoin Blockchain are stored in a decentralized manner on the computers of each individual Bitcoin Network full node (i.e., any user who chooses to maintain on their computer a full copy of the Bitcoin Blockchain, as well as related software). Each bitcoin is associated with a set of unique cryptographic "keys," in the form of a string of numbers and letters, which allow whoever is in possession of the private key to assign that bitcoin in a transfer that the Bitcoin Network will recognize. Bitcoin may be sent or received through users digital wallets by using public and private keys that are part of the Bitcoin Network s cryptographic security mechanism. The Bitcoin Network is a technological innovation developed in the last fifteen years, and the bitcoin that are created, transferred, used and stored by entities and individuals have certain features associated with several types of assets, most notably commodities and currencies. Many U.S. regulators, including the Financial Crimes Enforcement Network of the U.S. Department of the Treasury ("FinCEN"), the CFTC, the U.S. Internal Revenue Service ("IRS"), and state regulators, including the New York Department of Financial Services ("NYDFS"), have made official pronouncements or issued guidance or rules regarding the treatment of bitcoin and other digital currencies. However, other U.S. and state agencies have not made official pronouncements or issued guidance or rules regarding the treatment of bitcoin. Similarly, the treatment of bitcoin and other digital currencies is often uncertain or contradictory in other countries. The regulatory uncertainty surrounding the treatment of bitcoin creates risks for the Fund and its Shares. See "Risk Factors—Risks Related to Bitcoin, the Bitcoin Network and Bitcoin Trading Markets." Bitcoin Valuation The value of bitcoin is determined by the value that various digital asset market participants place on bitcoin through their transactions. The most common means of determining the value of a bitcoin is by surveying one or more digital asset exchanges where bitcoin is traded publicly and transparently. On exchanges, bitcoin is traded with publicly disclosed valuations for each executed trade, measured by one or more fiat currencies such as the U.S. dollar. OTC dealers or market makers do not typically disclose their data. There are many digital asset exchanges operating worldwide, representing a substantial percentage of bitcoin buying and selling activity, and providing the most data with respect to prevailing valuation of bitcoin. The Fund uses the same methodology as utilized by the Index to determine the value of its bitcoin. Digital asset trading platforms meeting the criteria set out by Kaiko, i.e., the Index Pricing Sources, are used to value bitcoin. Kaiko reviews the time-weighted average price from 3:00 p.m. ET to 4:00 p.m. ET on all eligible digital asset trading platforms and values bitcoin as the median value amongst the eligible digital asset platforms. The Sponsor believes this methodology provides a reasonable valuation of the spot price of bitcoin that is reasonably resistant to price manipulation of bitcoin. Purchases and Sales of Bitcoin Because the Fund will conduct creations and redemptions of Shares for cash, it will be responsible for purchasing and selling bitcoin in connection with those creation and redemption orders. The Fund may also be required to sell bitcoin to pay certain extraordinary, non-recurring expenses that are not assumed by the Sponsor. The Sponsor, on behalf of the Fund, is responsible for acquiring bitcoin from a bitcoin trading counterparty that has been approved by, and entered into an agreement with, the Sponsor (each, a "Bitcoin Trading Counterparty"), currently JSCT, LLC (which is an affiliate of Jane Street Capital, LLC, an Authorized Purchaser for the Fund), DV Chain, LLC and Gemini. The Bitcoin Trading Counterparties with which the Sponsor will engage in bitcoin transactions are unaffiliated third parties and all transactions will be done on an arm s-length basis. When seeking to purchase or sell bitcoin on behalf of the Fund, the Sponsor will typically seek to buy and sell bitcoin at a price as close to the Bitcoin Price (defined below) as practical from any of the approved Bitcoin Trading Counterparties. The Sponsor maintains a process for approving and monitoring Bitcoin Trading Counterparties, and all Bitcoin Trading Counterparties must be approved by the Sponsor before the Fund will engage in any transactions with the entity. The Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act") was enacted in response to the economic crisis of 2008 and 2009 and it significantly altered the regulatory regime to which the securities and commodities markets are subject. To date, the CFTC has issued proposed or final versions of almost all of the rules it is required to promulgate under the Dodd-Frank Act, and it continues to issue proposed versions of additional rules that it has authority to promulgate. Provisions of the new law include the requirement that position limits be established on a wide range of commodity interests, including agricultural, energy, and metal-based commodity futures contracts, options on such futures contracts and uncleared swaps that are economically equivalent to such futures contracts and options ("Reference Contracts"); new registration and recordkeeping requirements for swap market purchasers; capital and margin requirements for "swap dealers" and "major swap," as determined by the new law and applicable regulations; reporting of all swap transactions to swap data repositories; and the mandatory use of clearinghouse mechanisms for sufficiently standardized swap transactions that were historically entered into in the OTC market, but are now designated as subject to the clearing requirement; and margin requirements for OTC swaps that are not subject to the clearing requirements. In addition, considerable regulatory attention has recently been focused on non-traditional publicly distributed investment pools such as the Fund. Furthermore, various national governments have expressed concern regarding the disruptive effects of speculative trading in certain commodity markets and the need to regulate the derivatives markets in general. The effect of any future regulatory change on the Funds is impossible to predict but could be substantial and adverse. The Dodd-Frank Act was intended to reduce systemic risks that may have contributed to the 2008/2009 financial crisis. Since the first draft of what became the Dodd-Frank Act, supporters and opponents have debated the scope of the legislation. As the Administrations of the U.S. change, the interpretation and implementation will change along with them. Nevertheless, regulatory reform of any kind may have a significant impact on U.S. regulated entities. Spot Market Transactions Spot markets, on the other hand, are largely unregulated and rely on pricing sources that track over-the-counter (OTC) transactions. For cryptoassets, including bitcoin, these OTC transactions are relatively new and usually take place in the so-called crypto exchanges or digital asset trading platforms. Digital asset trading platforms are relatively new and, in some cases, unregulated. Furthermore, while many prominent digital asset trading platforms provide the public with significant information regarding their ownership structure, management teams, corporate practices and regulatory compliance, many digital asset trading platforms do not provide this information. Digital asset trading platforms do not appear to be subject to, or may not comply with, regulation in a similar manner as other regulated trading platforms, such as national securities trading platforms or designated contract markets. These markets are local, national and international and include a broadening range of digital assets and participants. Significant trading may occur on systems and platforms with minimum predictability. Furthermore, many spot markets and over-the-counter market venues do not provide the public with significant information regarding their ownership structure, management teams, corporate practices or oversight of customer trading. As a result, the marketplace may lose confidence in digital asset trading platforms, including prominent trading platforms that handle a significant volume of bitcoin trading. Many digital asset trading platforms are unlicensed, unregulated, operate without extensive supervision by governmental authorities, and do not provide the public with significant information regarding their ownership structure, management team, corporate practices, cybersecurity, and regulatory compliance. In particular, those located outside the United States may be subject to significantly less stringent regulatory and compliance requirements in their local jurisdictions. As a result, trading activity on or reported by these digital asset trading platforms is generally significantly less regulated than trading in regulated U.S. securities and commodities markets, and may reflect behavior that would be prohibited in regulated U.S. trading venues. Position Limits, Aggregation Limits, Price Fluctuation Limits The CFTC and US futures exchanges impose limits on the maximum net long or net short speculative positions that any person may hold or control in any particular futures or options contracts traded on US futures exchanges. For example, the CFTC currently imposes speculative position limits on cryptocurrencies and a number of commodities (e.g., corn, oats, wheat, soybeans and cotton) and US futures exchanges currently impose speculative position limits on many other commodities. The Fund could be required to liquidate positions it holds in order to comply with position limits or may not be able to fully implement trading instructions in order to track its index, the 7RCC Kaiko Bitcoin Carbon Credit Index (the "Index") in order to comply with position limits. Any such liquidation or limited implementation could result in substantial costs to the Fund and the Fund s performance to deviate from that of the Index. The Dodd-Frank Act significantly expanded the CFTC s authority to impose position limits with respect to futures contracts and options on futures contracts, swaps that are economically equivalent to futures or options on futures, and swaps that are traded on a regulated exchange and certain swaps that perform a significant price discovery function. The aggregate position limits currently in place under the current position limits and the Aggregation Requirements are as follows for each of the carbon credit futures contracts traded by the Fund: Carbon Credit Futures Contract Spot Month Position Limit All Month and Single Month (excluding spot month) Aggregate Accountability Level Intercontinental Exchange ("ICE") EUA (Carbon Emission Allowances) futures contracts ICE California Carbon Allowance Vintage Future contracts ICE RGGI (CO2 allowances) futures contracts COMMODITY FUTURES TRADING COMMISSION RISK DISCLOSURE STATEMENT YOU SHOULD CAREFULLY CONSIDER WHETHER YOUR FINANCIAL CONDITION PERMITS YOU TO PARTICIPATE IN A COMMODITY POOL. IN SO DOING, YOU SHOULD BE AWARE THAT COMMODITY INTEREST TRADING CAN QUICKLY LEAD TO LARGE LOSSES AS WELL AS GAINS. SUCH TRADING LOSSES CAN SHARPLY REDUCE THE NET ASSET VALUE OF THE COMMODITY POOL AND CONSEQUENTLY THE VALUE OF YOUR INTEREST IN THE COMMODITY POOL. IN ADDITION, RESTRICTIONS ON REDEMPTIONS MAY AFFECT YOUR ABILITY TO WITHDRAW YOUR PARTICIPATION IN THE COMMODITY POOL. FURTHER, COMMODITY POOLS MAY BE SUBJECT TO SUBSTANTIAL CHARGES FOR MANAGEMENT, AND ADVISORY AND BROKERAGE FEES. IT MAY BE NECESSARY FOR THOSE COMMODITY POOLS THAT ARE SUBJECT TO THESE CHARGES TO MAKE SUBSTANTIAL PROFITS TO AVOID DEPLETION OR EXHAUSTION OF THEIR ASSETS. THIS DISCLOSURE DOCUMENT CONTAINS A COMPLETE DESCRIPTION OF EACH EXPENSE TO BE CHARGED BY THIS COMMODITY POOL AT PAGE [ ] AND A STATEMENT OF THE PERCENTAGE RETURN NECESSARY TO BREAK EVEN, THAT IS, TO RECOVER THE AMOUNT OF YOUR INITIAL INVESTMENT, AT PAGE [ ]. THIS BRIEF STATEMENT CANNOT DISCLOSE ALL THE RISKS AND OTHER FACTORS NECESSARY TO EVALUATE YOUR PARTICIPATION IN THIS COMMODITY POOL. THEREFORE, BEFORE YOU DECIDE TO PARTICIPATE IN THIS COMMODITY POOL, YOU SHOULD CAREFULLY STUDY THIS PROSPECTUS, INCLUDING A DESCRIPTION OF THE MATERIAL RISK FACTORS OF THIS INVESTMENT, AT PAGE [ ]. YOU SHOULD ALSO BE AWARE THAT THIS COMMODITY POOL MAY ENGAGE IN OFF-EXCHANGE FOREIGN CURRENCY TRADING. SUCH TRADING IS NOT CONDUCTED IN THE INTERBANK MARKET. THE FUNDS THAT THE POOL USES FOR OFF-EXCHANGE FOREIGN CURRENCY TRADING WILL NOT RECEIVE THE SAME PROTECTIONS AS FUNDS USED TO MARGIN OR GUARANTEE EXCHANGETRADED FUTURES AND OPTION CONTRACTS. IF THE POOL DEPOSITS SUCH FUNDS WITH A COUNTERPARTY AND THAT COUNTERPARTY BECOMES INSOLVENT, THE POOL S CLAIM FOR AMOUNTS DEPOSITED OR PROFITS EARNED ON TRANSACTIONS WITH THE COUNTERPARTY MAY NOT BE TREATED AS A COMMODITY CUSTOMER CLAIM FOR PURPOSES OF SUBCHAPTER IV OF CHAPTER 7 OF THE BANKRUPTCY CODE AND THE REGULATIONS THEREUNDER. THE POOL MAY BE A GENERAL CREDITOR AND ITS CLAIM MAY BE PAID, ALONG WITH THE CLAIMS OF OTHER GENERAL CREDITORS, FROM ANY MONIES STILL AVAILABLE AFTER PRIORITY CLAIMS ARE PAID. EVEN POOL FUNDS THAT THE COUNTERPARTY KEEPS SEPARATE FROM ITS OWN FUNDS MAY NOT BE SAFE FROM THE CLAIMS OF PRIORITY AND OTHER GENERAL CREDITORS. TIDAL INVESTMENTS LLC ("TIDAL") IS A MEMBER OF NFA AND IS SUBJECT TO NFA S REGULATORY OVERSIGHT AND EXAMINATIONS. TIDAL HAS ENGAGED OR MAY ENGAGE IN UNDERLYING OR SPOT VIRTUAL CURRENCY TRANSACTIONS IN A COMMODITY POOL. ALTHOUGH NFA HAS JURISDICTION OVER TIDAL AND ITS COMMODITY POOL, YOU SHOULD BE AWARE THAT NFA DOES NOT HAVE REGULATORY OVERSIGHT AUTHORITY FOR UNDERLYING OR SPOT MARKET VIRTUAL CURRENCY PRODUCTS OR TRANSACTIONS OR VIRTUAL CURRENCY EXCHANGES, CUSTODIANS OR MARKETS. YOU SHOULD ALSO BE AWARE THAT GIVEN CERTAIN MATERIAL CHARACTERISTICS OF THESE PRODUCTS, INCLUDING LACK OF A CENTRALIZED PRICING SOURCE AND THE OPAQUE NATURE OF THE VIRTUAL CURRENCY MARKET, THERE CURRENTLY IS NO SOUND OR ACCEPTABLE PRACTICE FOR NFA TO ADEQUATELY VERIFY THE OWNERSHIP AND CONTROL OF A VIRTUAL CURRENCY OR THE VALUATION ATTRIBUTED TO A VIRTUAL CURRENCY BY TIDAL. "Swap Agreement"—An OTC derivative that generally involved an exchange of a stream of payments between the contracting parties based on a notional amount and a specified index. "Transfer Agent"—Global Fund Services. "Transfer Agent Fee"—Fee payable to the Transfer Agent for services it provides to the Trust, which the Sponsor shall pay to the Transfer Agent as a Sponsor-paid Expense. "Treasury Securities"—Fixed-income assets issued by the United States Treasury Department. "Trust"—Tidal Commodities Trust I, a Delaware statutory trust under the DSTA and the pursuant to the Trust Agreement. "Trust Agreement"—The First Amended and Restated Declaration of Trust and Trust Agreement between the Trustee and the Sponsor establishing and governing the operations of the Trust dated as of March 10, 2023, as the same may be amended from time to time. "Trustee"—Wilmington Trust, National Association, the Delaware trustee of the Trust. "U.S. Dollar" or "$"—United States Dollar or Dollars. "Vault Balance"—One or more storage accounts in the name of the Sponsor and of the Fund held for the safekeeping of the Fund s bitcoin. "VCMs"—Voluntary carbon markets. Carbon Credit Futures Futures contracts are standardized contracts that obligate the parties to buy or sell an asset at a predetermined price and date in the future. The Carbon Credit Futures that comprise the sleeve of the Index are linked to the value of emissions allowances issued under the EU ETS, CCA and RGGI. Commodity futures contracts linked to the value of emission allowances are known as "carbon credit futures". The Fund will invest in the Carbon Credit Futures that comprise the Index directly, specifically, EU CEA Carbon Credit Futures, CCA Carbon Credit Futures and RGGI Carbon Credit Futures. The Fund does not intend to invest in carbon credit futures specifically linked to bitcoin mining or other related processes. As explained below, the Index rolls its Carbon Credit Futures contracts prior to the expiration of such contract in December. One factor determining the total return from investing in futures contracts is the price relationship between soon to expire contracts and later to expire contracts. Under certain market conditions, the Fund may have to pay more for longer maturity contracts to replace existing shorter maturity contracts about to expire. This situation is known as "contango" in the futures markets. In the event of a prolonged period of contango, and absent the impact of rising or falling prices for Carbon Credit Futures contracts, this could have a negative impact on the Fund s NAV and total return, which in turn may have a negative impact on your investment in the Fund. Alternatively, the market for Carbon Credit Futures contracts may be in a state of backwardation (i.e., when the price of the futures contract in the future is less than the current price), in which case the Fund will buy later-to-expire contracts for a lower price than the soon-to-expire contracts it sells. The Index is comprised of futures contracts on emissions allowances issued by various "cap-and-trade" regulatory regimes that seek to reduce greenhouse gas ("GHG") emissions over time. A cap-and-trade regime typically involves a regulator setting a limit on the total amount of specific greenhouse gasses (such as CO2) that can be emitted by regulated entities. Capping and reducing the cap on GHGs is viewed as a key policy tool in reaching climate change objectives. The regime is designed to promote sustainable development by putting a price on carbon emissions. The regulator will then issue or sell "emissions allowances" to regulated entities, which in turn may buy or sell the emissions allowances to the open market. To the extent that the regulator may then reduce the cap on emission allowances, regulated entities are incentivized to reduce their emissions; otherwise, they must purchase additional emission allowances on the open market, where the price of such allowances will likely be increasing as a result of demand, and regulated entities that reduce their emissions will be able to sell unneeded emission allowances for profit. An emission allowance or carbon credit is a unit of emissions (typically one ton of CO2) that the owner of the allowance or credit is permitted to emit. Futures contracts linked to the value of emission allowances are known as "carbon credit futures". The Index The Index provides exposure to the daily price performance of bitcoin and Carbon Credit Futures by aiming to track the financial performance of investing in a portfolio of 80% bitcoin and 20% Carbon Credit Futures. In providing this exposure, the Index seeks to provide exposure to bitcoin with an environmentally responsible approach with exposure to carbon credits. Invierno AB, Reg. No. 559207-4172, Box 5193, 10244 Stockholm, Sweden ("Kaiko") is the index provider, benchmark administrator and calculates the price of bitcoin used by the Index. Kaiko is also the central recipient of input data and evaluates the integrity and accuracy of the input data. Solactive AG ("Solactive") is calculation agent of the Index, and is also the index provider for each of the sub-indexes that comprise the Index, as detailed below. To calculate the value of bitcoin, Kaiko selects digital asset trading platforms meeting specific criteria (the "Index Pricing Sources") and takes the time-weighted average price from 3:00 pm ET to 4:00 pm ET on each Index Pricing Source. Kaiko then calculates the median price across the Index Pricing Sources to determine the value of bitcoin (the "Bitcoin Price"). The Carbon Credit Futures portion of the Index is built using a combination of three carbon credit indices, each of which is calculated and administered by Solactive: Solactive Future Series European Carbon Credit Rolling Futures Index (the "European Sub-index"), Solactive Future Series California Carbon Rolling Futures Index (the "California Sub-index"), and the Solactive Future Series Regional Greenhouse Gas Rolling Futures Index (the "RGGI Sub-index" and, collectively with the European Sub-index and the California Sub-index, the "Sub-indexes"). The three underlying Sub-indexes provides the Index with returns tied to futures contracts on carbon credits connected to EU ETS, CCA and RGGI. The Fund s Carbon Credit Futures will not result in any direct participation by the Fund in any particular carbon emissions offsetting project, including any carbon emissions associated with the mining of bitcoin or the Fund s bitcoin holdings. The Sub-indexes include only Carbon Credit Futures that mature in the upcoming December. Each Sub-index includes front-month futures contracts that are rolled over a five-day period prior to the expiration of the current-year futures contract and rolls into a contract with an expiration date of December of the immediately following year. The Index rebalances quarterly to maintain the 80:20 percent ratio between bitcoin and Carbon Credit Futures in March, June, September and December. The December rebalance of the Index is the business day that immediately follows the December rolling of futures contracts of the Sub-indexes. The CFTC has attempted to exercise authority to enact additional and more restricted speculative position limits with respect to futures and options on futures on so-called "exempt commodities" (which includes most energy and metals contracts) and with respect to agricultural commodities, but those proposed limits were vacated by a United States District Court. The CFTC has once again attempted to enact additional and more restrictive limits. For a discussion generally regarding the risks that position limits may pose for the Fund, see the "RISK FACTORs" section and related disclosure regarding position limits, accountability levels and dynamic price fluctuation limits. With the exception of the nine legacy agricultural contracts, the CFTC s position limits would apply only in the spot month. These limits would generally be set at 25 percent of the deliverable supply but may be higher or lower for certain contracts. With respect to the non-legacy contracts, the rule would require the relevant exchange on which the contracts are traded to adopt either position limits or position accountability levels. The proposed rules also would expand the current list of enumerated bona fide hedges to include, for example, hedges of anticipated merchandizing. To provide market purchasers with greater flexibility on managing their business risks, the proposal also provides guidance on whether and when market purchasers are permitted to measure risk on a gross basis rather than a net basis. However, firms will be required to measure risk on a consistent basis. Enumerated hedges are self-effectuating. That is, no prior approval would be required from the CFTC, although a market purchaser would be required to obtain approval from the relevant exchange. Self-effectuating hedge exemptions also would be available for other transactions such as spreads and pass-through swaps as approved by exchanges. With respect to non-enumerated hedge exemptions, a market purchaser would be required to file a request to exceed the position limit with the relevant exchange. If the exchange grants the request for a non-enumerated hedge exemption, the exchange will forward its decision to the CFTC for review. The exemption will be deemed granted provided the CFTC does not intervene during a 10-day review period. The market purchaser would not be permitted to exceed the applicable position limit until the 10-day review period lapses. Importantly, the CFTC may act solely through its commissioners and not through staff. In terms of process changes, the CFTC is proposing to eliminate Form 204 cash positions report and the cash information reported under Form 304. Comments on the proposed rule must be submitted no later than 90 days after approval of the proposal by the CFTC (i.e., April 29, 2020). The CFTC does not intend to extend the comment period. It is unknown at this time the effect that such passage, adoption or modification will have, positively or negatively, on the industry or on the Fund. The size or duration of positions available to the Fund may be severely limited. Pursuant to the CFTC s and the exchanges aggregation requirements, all accounts owned or managed by the Sponsor are likely to be combined for speculative position limits purposes. The Fund could be required to liquidate positions it holds in order to comply with such limits or may not be able to fully implement trading instructions generated by its trading models, in order to comply with such limits. Any such liquidation or limited implementation could result in substantial costs to the Fund. These new regulations and the resulting increased costs and regulatory oversight requirements may result in market purchasers being required or deciding to limit their trading activities, which could lead to decreased market liquidity and increased market volatility. In addition, transaction costs incurred by market purchasers are likely to be higher due to the increased costs of compliance with the new regulations. These consequences could adversely affect the Fund s returns. FCMs The CEA requires all FCMs, such as the Fund s clearing brokers, to meet and maintain specified fitness and financial requirements, to segregate customer funds from proprietary funds and account separately for all customers funds and positions, and to maintain specified books and records open to inspection by the staff of the CFTC. The CFTC has similar authority over introducing brokers, or persons who solicit or accept orders for commodity interest trades but who do not accept margin deposits for the execution of trades. The CEA authorizes the CFTC to regulate trading by FCMs and by their officers and directors, permits the CFTC to require action by exchanges in the event of market emergencies, and establishes an administrative procedure under which customers may institute complaints for damages arising from alleged violations of the CEA. The CEA also gives the states powers to enforce its provisions and the regulations of the CFTC. THIS PROSPECTUS DOES NOT INCLUDE ALL OF THE INFORMATION OR EXHIBITS IN THE REGISTRATION STATEMENT OF THE FUND. INVESTORS CAN READ AND COPY THE ENTIRE REGISTRATION STATEMENT AT THE PUBLIC REFERENCE FACILITIES MAINTAINED BY THE SEC IN WASHINGTON, D.C. THE FUND WILL FILE QUARTERLY AND ANNUAL REPORTS WITH THE SEC. INVESTORS CAN READ AND COPY THESE REPORTS AT THE SEC PUBLIC REFERENCE FACILITIES IN WASHINGTON, D.C. PLEASE CALL THE SEC AT 1-800-SEC-0330 FOR FURTHER INFORMATION. THE FILINGS OF THE TRUST ARE POSTED AT THE SEC WEBSITE AT WWW.SEC.GOV. REGULATORY NOTICES NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE TRUST, THE FUND, THE SPONSOR, THE AUTHORIZED PARTICIPANTS OR ANY OTHER PERSON. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR SOLICITATION TO SELL OR A SOLICITATION OF AN OFFER TO BUY, NOR SHALL THERE BE ANY OFFER, SOLICITATION, OR SALE OF THE SHARES IN ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION, OR SALE IS NOT AUTHORIZED OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE ANY SUCH OFFER, SOLICITATION, OR SALE. AUTHORIZED PARTICIPANTS MAY BE REQUIRED TO DELIVER A PROSPECTUS WHEN TRANSACTING IN SHARES. SEE "PLAN OF DISTRIBUTION" IN PART ONE OF THIS PROSPECTUS. Risk Summary An investment in the Fund involves a high degree of risk uncertainty. Some of the risks associated with an investment in the Fund are summarized below. A more extensive discussion of these risks appears in the section titled "Risk Factors" which begins on page [ ]. These risks include, but are not limited to, the following: Risks Related to Bitcoin, the Bitcoin Network and Bitcoin Trading Markets The trading prices of many digital assets, including bitcoin, have experienced extreme volatility in recent periods and may continue to do so. The Fund invests 80% of its assets in bitcoin, the value of which is highly volatile and subject to fluctuations due to a number of factors. Future volatility, including declines in the trading prices of bitcoin, could have a material adverse effect on the value of Shares, and Shares could lose significant value. Digital assets represent a new and rapidly evolving industry, and the value of the Shares in part depends on the acceptance of bitcoin. Competition from the emergence or growth of other digital assets or methods of investing in bitcoin could negatively impact the price of bitcoin and therefore the value of the Shares. The value of Shares is subject to a number of factors relating to the fundamental investment characteristics of bitcoin as a digital asset including the fact that digital assets such as bitcoin are bearer instruments and loss, theft, destruction or compromise of associate private keys could result in permanent loss of the asset. Due to the unregulated nature and lack of transparency surrounding the operations of digital asset exchanges, they may experience fraud, security failures or operational problems, which may adversely affect the value of bitcoin and, consequently, the value of the Shares. The impact of geopolitical or economic events on the supply and demand for bitcoin is uncertain, but could motivate large-scale sales of bitcoin, which could result in a reduction in the value of bitcoin, and the Shares. Changes in the governance of a digital asset network may not receive sufficient support from users and miners, which may negatively affect that digital asset network s ability to grow and respond to changes. Risks Related to the Custody of Bitcoin Failure to safeguard and manage the Fund s bitcoin could adversely impact the value of Shares. Security threats to the Fund s account with the Bitcoin Custodian could result in the halt of Fund operations, a loss of Fund assets, or damage to the Fund s reputation, among others. Any of these factors could result in a reduction in the price of Shares. Due to the nature of private keys, bitcoin transactions are irrevocable, and stolen or incorrectly transferred bitcoin may be irretrievable. Any incorrectly executed bitcoin transactions could adversely affect an investment in the Fund. Loss, theft, destruction or compromise of private keys could result in permanent loss of the asset. The lack of full insurance and Shareholders limited rights of legal recourse against the Fund, Trustee, Administrator, and/or the Bitcoin Custodian exposes the Fund and its shareholders to the risk of loss of the Fund s bitcoin, for which no person or entity is liable. Risks Related to the Regulation of Bitcoin Digital asset markets in the U.S. exist in a state of regulatory uncertainty, and adverse legislative or regulatory developments could significantly harm the value of bitcoin or the Shares, such as by banning, restricting or imposing onerous conditions or prohibitions on the use of bitcoin, mining activity, digital wallets, the provision of services related to trading and custodying bitcoin, the operation of the Bitcoin Network, or the digital asset markets generally. The U.S. federal income tax treatment of transactions in digital assets is unclear. Risks Related to Carbon Credit Futures and the Fund s Status as a Commodity Pool There is no assurance that cap-and-trade regimes will continue to exist. New technologies may arise that diminish or eliminate the need for cap-and-trade markets. Emissions limits allocations may not properly reflect the amount needed for a stable price of credits, which can lead to large price volatility. 7RCC Spot Bitcoin and Carbon Credit Futures ETF STATEMENT OF ADDITIONAL INFORMATION TABLE OF CONTENTS Regulation 2 Futures Market Regulation 2 Spot Market Transactions 3 Position Limits, Aggregation Limits, Price Fluctuation Limits 3 FCMs 4 Potential Advantages of Investment 5 Interest Income and Expense. 5 Fund Performance On November 14, 2013, the CFTC published final regulations that require enhanced customer protections, risk management programs, internal monitoring and controls, capital and liquidity standards, customer disclosures and auditing and examination programs for FCMs. The rules are intended to afford greater assurances to market purchasers that customer segregated funds and secured amounts are protected, customers are provided with appropriate notice of the risks of futures trading and of the FCMs with which they may choose to do business, FCMs are monitoring and managing risks in a robust manner, the capital and liquidity of FCMs are strengthened to safeguard the continued operations and the auditing and examination programs of the CFTC and the SROs are monitoring the activities of FCMs in a thorough manner. Potential Advantages of Investment Interest Income and Expense. Unlike some alternative investment funds, the Fund does not borrow money in order to obtain leverage, so the Fund does not incur any interest expense. Rather, the Fund s margin deposits, and cash reserves are maintained in cash and cash equivalents and interest is generally earned on available assets, which include unrealized profits credited to the Fund s accounts. Fund Performance As of the date of this prospectus, the Fund has not yet commenced trading and does not have any performance history. Legislative or regulatory changes may impact the operation of the Fund, the regulation and enforcement of cap-and-trade regimes, the competitive landscape and/or market behavior regarding cap-and-trade regimes. New regulation relating to cap-and-trade markets may arise, which could negatively impact the value underlying carbon credits, the liquidity of said markets and the Fund. Investments in commodity-linked derivatives, such as Carbon Credit Futures, involve risks that are greater than, and different from, investing directly in the referenced commodity. Commodity-linked derivatives may also be subject to greater price volatility than the underlying reference asset. The Fund obtains exposure to Carbon Credit Futures with multiple geographic focuses, and accordingly is subjected to the accompanying geographic risks. The Fund may also experience risks related to the energy, agriculture and metal sectors, among others, in connection with its exposure to Carbon Credit Futures. In some cases, the near-month Carbon Credit Futures price will be lower than the next month s contract prices (i.e., "contango"). In the event of a prolonged period of contango, and absent the impact of rising or falling prices of the underlying carbon credit, this could have a significant negative impact on the Fund s NAV and total return, and you could incur a partial or total loss of your investment in the Fund. Position limits and margin requirements, among other limitations, may have the potential to cause tracking error, which could cause the price of Shares to substantially vary from the Index. The Fund utilizes futures commission merchants ("FCMs") to buy and sell its futures contracts. Volatility in the Carbon Credit Futures may lead its FCMs to impose risk mitigation procedures that could limit the Fund s investment in Carbon Credit Futures beyond the accountability or position limits imposed by the futures contract exchange. An FCM could impose a financial ceiling on initial margin that could change and become more or less restrictive on the Fund s activities depending upon a variety of conditions beyond the Sponsor s control. If the Fund s current FCMs were to impose position limits, or if any other FCM with which the Fund establishes a relationship in the future were to impose position limits, the Fund s ability to meet its investment objective could be negatively impacted. The Fund continues to monitor and manage its existing relationships with its FCMs and will continue to seek additional relationships with FCMs as needed. The Fund is deemed a "commodity pool" and is therefore subject to regulation under the CEA and CFTC rules. The Fund and the Sponsor, as the Fund s CPO, is subject to additional laws, regulations and enforcement policies, all of which may affect the operations of the Fund. Regulation in the commodity-linked derivatives markets is extensive and constantly changing. Future regulatory developments are impossible to predict, but may significantly and adversely affect the operations and value of the Fund. Risks Related to the Index The Index has a limited history. The Bitcoin Price could fail to track the global bitcoin price and a failure of the Bitcoin Price could adversely affect the value of Shares. The price used by the Index to calculate the value of bitcoin may be volatile, which could adversely affect the value of Shares. The Index price being used to determine the net asset value of the Fund may not be consistent with GAAP. To the extent the Fund s financial statements are determined using a different pricing source that is consistent with GAAP, the NAV reported in the Fund s periodic financial statements may differ, and may differ significantly, from the Fund s NAV determined using the pricing of the Index. Risks Related to the Fund and the Shares The Fund is new and an investment in the Fund may have more risks than an investment in an established, larger fund. Further, the Sponsor and its management have a limited history of operating investment vehicles like the Fund. The Fund has a limited number of financial institutions that may act as Authorized Purchasers. If regulatory changes or interpretations of an Authorized Purchaser s, the Fund s or the Sponsor s require the regulation of an Authorized Purchaser, the Fund or the sponsor as a money service business under the regulations promulgated by FinCen, an Authorized Purchaser, the Fund, or the Sponsor may be required to register and comply with such regulations, which could result in extraordinary, recurring and/or non-recurring expenses. PROSPECTUS 7RCC SPOT BITCOIN AND CARBON CREDIT FUTURES ETF Until [__________, ____] (25 calendar days after the date of this prospectus), all dealers effecting transactions in the Shares, whether or not participating in this distribution, may be required to deliver a prospectus. This requirement is in addition to the obligations of dealers to deliver a prospectus when acting as underwriters and with respect to unsold allotments or subscriptions. [________, _____] There are certain risks and tax considerations due to the Fund s cash transactions for the creation and redemption processes. Unanticipated difficulties with respect to the issuance or redemption of Baskets, including but not limited to the withdrawal of Authorized Purchasers, may impact the arbitrage mechanism intended to keep the trading price of Shares closely linked to its NAV and liquidity of the Shares may be adversely impacted. Potential conflicts of interest may arise among the Sponsor or its affiliates and the Fund. The Trust Agreement modifies and restricts the default fiduciary duties under the DSTA, which could permit them to favor their own interests to the detriment of the Fund and its Shareholders under Delaware law. That notwithstanding, the Sponsor is a registered investment adviser under the Investment Advisers Act of 1940, as amended (the "Advisers Act") and is subject to fiduciary duties in connection therewith. Custody of the Fund s Assets The Fund s assets will be split among two custodians. The Trust, on behalf of the Fund, intends to appoint Gemini Trust Company, LLC ("Gemini" and the "Bitcoin Custodian") for the Fund s bitcoin holdings. Separately, U.S. Bank, N.A. (the "Non-Digital Custodian" and collectively with the Bitcoin Custodian, the "Custodians") will serve as the Fund s custodian with respect to its cash and cash equivalents investments, as well as any investments in connection with its investments in Carbon Credit Futures. The Trust, on behalf of the Fund, has entered into a custodial services agreement with Gemini (the "Bitcoin Custody Agreement"), pursuant to which the Bitcoin Custodian will custody all of the Fund s bitcoin. Pursuant to the Bitcoin Custody Agreement, the Bitcoin Custodian establishes accounts that hold the bitcoins deposited with the Bitcoin Custodian on behalf of the Fund. The Fund has also entered into a custodial agreement with the Non-Digital Custodian (the "Non-Digital Custody Agreement") pursuant to which the Non-Digital Custodian will custody the Fund s investments in cash and cash equivalents in connection with the investments in the Carbon Credit Futures. With respect to the settlement of Shares in response to the placement of creation orders and redemption orders from Authorized Purchasers, the Sponsor will retain discretion with respect to which of the Custodians and accompanying assets is selected to facilitate the respective order. Custody of Bitcoin The Fund is responsible for acquiring bitcoin from a Bitcoin Trading Counterparty. Once the bitcoin has been transferred to the applicable Bitcoin Custodian, it will be stored pursuant to the terms of the applicable Bitcoin Custody Agreement. Bitcoin private keys are stored in two different forms: "hot" storage, whereby the private keys are stored on secure, internet-connected devices (a "hot wallet"), and "cold" storage, where digital currency private keys are stored completely offline. The Bitcoin Custody Agreement requires the Bitcoin Custodian to hold the Fund s bitcoin in cold storage, unless required to facilitate withdrawals as a temporary measure. The Bitcoin Custodian will use segregated cold storage bitcoin addresses for the Fund which are separate from the bitcoin addresses that the Bitcoin Custodian uses for its other customers and which are directly verifiable via the Bitcoin Blockchain. The Bitcoin Custodian will at all times record and identify in its books and records that such bitcoins constitute the property of the Fund. The Bitcoin Custodian will not withdraw the Fund s bitcoin from the Fund s account with the Bitcoin Custodian, or loan, hypothecate, pledge or otherwise encumber the Fund s bitcoin, without the Fund s instruction. The Sponsor has evaluated the Bitcoin Custodian s policies, procedures, and controls for safekeeping, exclusively possessing, and controlling the Fund s bitcoin holdings and believes these are designed consistent with accepted industry practices to protect against theft, loss, and unauthorized and accidental use of the private keys. Notwithstanding the Sponsor s evaluation, the Sponsor does not control the Bitcoin Custodian s operations or implementation of such policies, procedures and controls and there can be no assurance that they will actually work as designed or prove to be successful in safeguarding the Fund s assets against all possible sources of theft, loss or damage. While the Bitcoin Custodian carries insurance, its insurance does not cover any loss in value of bitcoin and only covers losses caused by certain events such as fraud or theft and, in such covered events, it is unlikely the insurance would cover the full amount of any losses incurred by the Fund. The insurance maintained by the Bitcoin Custodian is shared among all of the Bitcoin Custodian s customers, is not specific to the Fund or to any customers holding bitcoin with the Bitcoin Custodian, and may not be available or sufficient to protect the Fund from all possible losses or sources of losses. Custody Relating to the Carbon Credit Futures The Fund will maintain an investment in Carbon Credit Futures, the notional amount of which will match the exposure of the Index. At any given time, however, most of the Fund s investments are in cash and cash equivalents that support the Fund s positions in the Carbon Credit Futures. Instead of depositing the entirety of the notional amount of the Carbon Credit Futures contracts with the FCM, the Fund posts a margin deposit, approximately 10% to 20% of the notional amount, with the FCM. To secure its Carbon Credit Futures obligations, the Fund deposits the required margin with the FCM and separately holds its remaining assets through the Non-Digital Custodian, specifically in cash or cash equivalents. Cash equivalents shall mean such investments that, in the view of the Sponsor, are of high credit quality and liquidity and can be converted to cash quickly. Such investments shall include: (a) cash; (b) debt securities issued or directly or indirectly fully guaranteed or insured by the United States or any agency or instrumentality thereof (such as U.S. Treasury Bills); (c) commercial paper or finance company paper of sufficient credit quality in the view of the Sponsor; or (d) money market mutual funds. Additionally, the Fund will use spot market or foreign exchange forwards and customary foreign exchange hedging instruments to seek to remove its foreign currency exposure. Such remaining assets may be used to meet future margin payments the Fund may be required to make on its Carbon Credit Futures. The Fund earns interest and other income from the cash equivalents that it purchases, and on the cash, it holds through the Custodian or other financial institutions. The earned interest and other income increase the Fund s NAV. The Fund applies the earned interest and other income to the acquisition of additional investments or uses it to pay its expenses. When the Fund reinvests the earned interest and other income, it makes investments that are consistent with its investment objectives. Trust Structure The Trust is a Delaware statutory trust, organized on February 10, 2023, that operates pursuant to the First Amended and Restated Declaration of Trust and Trust Agreement between the Sponsor and the Trustee (the "Trust Agreement"). The Trust is governed by the provisions of the Trust Agreement. The Fund is a series of the Trust. Each Share of the Fund represents a fractional undivided beneficial interest in the net assets of the Fund. The Trust s Sponsor is Tidal Investments LLC, a Delaware limited liability company. The Shares are not obligations of, and are not guaranteed by, the Sponsor or any of its subsidiaries or affiliates. Under the Delaware Limited Liability Company Act and the governing documents of the Trust, the Sponsor is not responsible for the debts, obligations and liabilities of the Trust solely by reason of being the Sponsor; provided that the Sponsor has assumed responsibility for the payment of certain Fund expenses. The Sponsor arranged for the creation of the Trust and the establishment of its series, the Fund, and is arranging for the registration of the Shares for their public offering in the United States ("U.S.") and their listing on the Exchange. The Sponsor is obligated to assume and pay the following fees and expenses of the Trust: the Trustee s fee payable under the Trust Agreement, the Custodians Fees (as defined herein), the Transfer Agent Fee (as defined herein), the Marketing Fee (as defined herein), applicable license fees, including the licensing fees related to the Index License Agreement (as defined herein), the Administrator Fee (as defined herein), fees and expenses related to trading of Shares on the Exchange (including marketing, legal and audit fees and expenses), legal expenses, audit fees, regulatory fees, including any fees relating to the registration of the Shares with the SEC, printing and mailing costs and costs of maintaining the Trust s website. The Sponsor also paid the costs of the Trust s organization. As interests in a Delaware statutory trust, the Shares do not possess the rights normally associated with the ownership of shares of a corporation (including, for example, the right to bring shareholder oppression and derivative actions). In addition, the Shares have limited voting and distribution rights (for example, shareholders do not have the right to elect directors, as the Trust does not have a board of directors, and generally will not receive regular distributions of the net income and capital gains earned by the Fund). Shareholders have no voting rights except as expressly provided in the Trust Agreement. The general role, responsibilities and regulation of the Sponsor, Trustee, Administrator, and Custodians are further described on pages [ ], [ ], [ ], [ ] and [ ], respectively. Detailed descriptions of certain specific rights and duties of the Sponsor, Trustee, Administrator, and Custodians begin on page [ ]. Emerging Growth Company and Smaller Reporting Company Status The Fund is an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"). For as long as the Fund is an emerging growth company, it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies," including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes–Oxley Act of 2002 (the "Sarbanes-Oxley Act"), reduced disclosure obligations regarding executive compensation in the Trust s periodic reports and audited financial statements in this prospectus, exemptions from the requirements of holding advisory "say-on-pay" votes on executive compensation and shareholder advisory votes on "golden parachute" compensation and exemption from any rules requiring mandatory audit firm rotation and auditor discussion and analysis and, unless otherwise determined by the SEC, any new audit rules adopted by the Public Company Accounting Oversight Board (the "PCAOB"). Under the JOBS Act, the Fund will remain an emerging growth company until the earliest of: (i) the last day of the fiscal year during which the Fund has total annual gross revenues of $1.235 billion or more; (ii) the last day of the fiscal year following the fifth anniversary of the completion of this offering; (iii) the date on which the Fund has, during the previous three-year period, issued more than $1 billion in non-convertible debt; or (iv) the date on which the Fund is deemed to be a "large accelerated filer" (i.e., an issuer that (1) has more than $700 million in outstanding equity held by non-affiliates and (2) has been subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act") for at least 12 calendar months and has filed at least one annual report on Form 10-K.) In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies; however, the Fund is choosing to "opt out" of such extended transition period, and as a result, the Fund will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for companies that are not "emerging growth companies." Section 107 of the JOBS Act provides that the Fund s decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable. We are also a "smaller reporting company" as defined in the Exchange Act. We may continue to be a smaller reporting company even after we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as the market value of our voting and non-voting common stock held by non-affiliates is less than $250 million measured on the last business day of our second fiscal quarter, or our annual revenue is less than $100 million during the most recently completed fiscal year and the market value of our voting and non-voting common stock held by non-affiliates is less than $700 million measured on the last business day of our second fiscal quarter. U.S. Federal Income Tax Considerations The Fund, as a series of the Trust, will be classified as a corporation for U.S. federal income tax purposes. As a result, the Fund will be obligated to pay applicable U.S. federal and state corporate income taxes on its taxable income. See discussion under "Material U.S. Federal Income Tax Consequences" below. Breakeven Amounts The Fund will be profitable only if returns from the Fund s investments exceed its "breakeven amount." The breakeven analysis is an approximation only and assumes a constant month-end. The return that the Fund would need to achieve during one-year to offset the Fund s estimated fees, costs and expenses, net of any interest income earned by the Fund on its investments is 0.16% or $0.04. For purposes of this breakeven analysis, an initial selling price of $25.00 per Share, is assumed. Estimated amounts do not represent actual results, which may be different. It is not possible to predict whether the Fund will break even at the end of the first twelve months of an investment or during any other period. See "Charges—Breakeven Analysis" for more detailed information. Defined Terms For a glossary of defined terms, see the "Glossary of Defined Terms" herein. Principal Offices The Fund is a series of the Trust. The principal office and telephone number of the Trust and the Sponsor is located at 234 West Florida Street, Suite 203, Milwaukee, Wisconsin 53204, and is (844)-986-7700. THE OFFERING Shares offered by the Fund: Shares representing units of fractional undivided beneficial interest in, and ownership of, the Fund. Use of Proceeds: The proceeds of offering the Shares received by the Fund consist of cash, which will be invested in accordance with the Fund s investment objective and strategies described herein. Exchange Symbol: BTCK CUSIP: 88634V209 Net Asset Value As described in more detail below in "Calculation of NAV", "NAV" means the total assets of the Fund, less any liabilities of the Fund. Included in the assets of the Fund are its investments in bitcoin and the value of the Fund s futures contracts. The Fund s NAV on a per Share basis is determined as of the earlier of the close of the Exchange or 4:00 p.m. (ET) on each day that the Exchange is open for trading. The Fund values bitcoin using the same methodology as the Bitcoin Price. Digital asset trading platforms meeting the criteria set out by Kaiko are used as the basis for which Kaiko determines the value of bitcoin. Kaiko reviews the time-weighted average price on all eligible digital asset trading platforms between 3:00 pm ET and 4:00 pm ET and values bitcoin as the median price amongst the eligible platforms. The Sponsor believes this methodology provides a reasonable valuation of the spot price of bitcoin that is reasonably resistant to price manipulation of bitcoin. In order to provide updated information relating to the Fund for use by Shareholders and market professionals, an updated intraday indicative value ("IIV") will be calculated and disseminated each trading day. The IIV will be calculated by using the prior day s closing NAV per Share of the Fund as a base and updating that value throughout the trading day to reflect changes in the value of the Fund s assets. ICE Data Services calculates and disseminates the IIV approximately every 15 seconds. IIV should not be viewed as an actual real time update of the NAV of the Fund. Creation and Redemption: The Fund issues Shares on an ongoing basis, but only in one or more whole Baskets. The Fund also intends to redeem Shares in Baskets on an ongoing basis from Authorized Purchasers (defined below). While investors will purchase and sell Shares through their broker-dealer, the Fund continuously offers creation baskets consisting of 10,000 Shares ("Creation Baskets") at their NAV to certain parties who have entered into an agreement with the Sponsor and the Administrator ("Authorized Purchasers"). The Fund issues and redeems Baskets each day that the Exchange is open for regular trading. The creation and redemption of Baskets requires the delivery of the cash equivalent of the NAV of the aggregate Shares comprising the Basket. Authorized Purchasers, in turn, may sell such Shares received from a Creation Basket on the exchange at the trading price of the Shares on the Exchange. Shares may trade in the secondary market at prices that are lower (a discount) or higher (a premium) than the NAV per Share. See "Description of Creation and Redemption of Shares" for additional information regarding the Fund s procedures regarding the issuance and redemption of Baskets. Fund expenses: The Fund s primary ordinary recurring expense is expected to be the remuneration due to the Sponsor (the "Management Fee"). The Management Fee will be in an amount equal to 0.68% per annum of the daily NAV of the Trust. The Management Fee accrues daily and payments of the Management Fee will occur monthly in arrears. The Management Fee is paid by the Fund to the Sponsor as compensation for services performed under the Trust Agreement, including the management of the Fund s business and affairs. The Sponsor has agreed to pay certain operating expenses of the Fund (except for litigation expenses and other extraordinary expenses) out of the Management Fee. The Fund pays all other transaction related fees and expenses charged in connection with trading activities for the Fund s investments and for maintenance of its CFTC regulatory status as a commodity pool. The Fund bears other transaction costs related to the FCM capital requirements on a monthly basis. The Fund may also incur certain extraordinary, non-recurring expenses and indemnification expenses that are not contractually assumed by the Sponsor. See "Expenses" for additional information. The Sponsor from time to time may sell bitcoin, which may be facilitated by the Bitcoin Custodian, in such quantity as is necessary to permit payment of the Management Fee and may also sell bitcoin, in such quantities as may be necessary to permit the payment of Fund expenses and liabilities not assumed by the Sponsor. To the extent the Sponsor sells bitcoin to permit payment of the Management Fee or other Fund expenses and liabilities not assumed by the Sponsor, the amount of bitcoin held by the Fund will decline over time. Incidental Rights/IR Virtual Currency From time to time, the Fund may be entitled to or come into possession of rights to acquire, or otherwise establish dominion and control over, any virtual currency (for avoidance of doubt, other than bitcoin) or other asset or right, which rights are incident to the Fund s ownership of bitcoins and arise without any action of the Fund, or of the Sponsor or Delaware Trustee on behalf of the Fund ("Incidental Rights") and/or virtual currency tokens, or other assets or rights, acquired by the Trust through the exercise (subject to the applicable provisions of the Trust Agreement) of any Incidental Right ("IR Virtual Currency") by virtue of its ownership of bitcoins, generally through a fork in the Bitcoin blockchain, an airdrop offered to holders of bitcoins or other similar event. With respect to a fork, airdrop or similar event, the Sponsor will cause the Fund to permanently and irrevocably abandon the Incidental Rights and IR Virtual Currency. In the event the Trust seeks to change this position, an application would need to be filed with the SEC by the Exchange seeking approval to amend its listing rules to permit the Fund to sell Incidental Rights or IR Virtual Currency and distribute the cash proceeds (net of expenses and applicable withholding taxes) to Depository Trust Company ("DTC") or distribute the Incidental Rights or IR Virtual Currency in-kind to the DTC. Because the Fund will abandon any Incidental Rights and IR Virtual Currency, the Fund would not receive any direct or indirect consideration for the Incidental Rights or IR Virtual Currency, and thus the value of the Shares will not reflect the value of the Incidental Rights or IR Virtual Currency. See "Risk Factors—Risks Related to Bitcoin, the Bitcoin Network, and Bitcoin Trading Markets— A temporary or permanent "fork" could adversely affect an investment in the Fund. Additionally, the Fund may not receive the benefit of any forks or "airdrops". " Inter-Series Limitation on Liability While the Fund is a separate series of the Trust, additional series may be created in the future. The Trust has been formed and will be operated with the goal that the Fund and any other series of the Trust will be liable only for obligations of such series, and a series will not be responsible for or affected by any liabilities or losses of or claims against any other series. If any creditor or shareholder in any particular series (such as the Fund) were to successfully assert against a series a claim with respect to its indebtedness or shares, the creditor or shareholder could recover only from that particular series and its assets. Accordingly, the debts and other obligations incurred, contracted for or otherwise existing solely with respect to a particular series would be enforceable only against the assets of that series, and not against any other series or the Trust generally or any of their respective assets. The assets of the Fund and any other series will include only those funds and other assets that are paid to, held by or distributed to the series on account of and for the benefit of that series, including, without limitation, amounts delivered to the Trust for the purchase of shares in a series. Termination events: The Trust and the Fund shall continue in existence from the date of their formation in perpetuity, unless the Trust or the Fund, as the case may be, is sooner terminated upon the occurrence of certain events specified in the Trust Agreement, including the following: (1) the filing of a certificate of dissolution or cancellation of the Sponsor or revocation of the Sponsor s charter or the withdrawal of the Sponsor, unless Shareholders holding a majority of the outstanding Shares of the Trust, voting together as a single class, elect within ninety (90) days after such event to continue the business of the Trust and appoint a successor Sponsor; (2) the occurrence of any event which would make the existence of the Trust or the Fund unlawful; (3) the suspension, revocation, or termination of the Sponsor s registration as a CPO with the CFTC or membership with the NFA; (4) the insolvency or bankruptcy of the Trust or the Fund; (5) a vote by the Shareholders holding at least seventy-five percent (75%) of the outstanding Shares of the Trust, voting together as a single class, to dissolve the Trust subject to certain conditions; (6) the determination by the Sponsor to dissolve the Trust or the Fund, subject to certain conditions; (7) the Trust is required to be registered as an investment company under the Investment Company Act; and (8) the DTC is unable or unwilling to continue to perform its functions and a comparable replacement is unavailable. Upon termination of the Fund, the affairs of the Fund shall be wound up and all of its debts and liabilities discharged or otherwise provided for in the order of priority as provided by law. The fair market value of the remaining assets of the Fund shall then be determined by the Sponsor in accordance with its policies for valuing assets, as detailed herein. Thereupon, the assets of the Fund shall be distributed pro rata to the Shareholders in accordance with their Shares. See "Additional Information About the Trust—Description of the Trust Agreement—Termination of the Trust" and "Calculation of NAV–Valuation of the Fund s Assets" for additional information. Authorized Purchasers: Baskets may be created or redeemed only by Authorized Purchasers. Each Authorized Purchaser must: (i) be a registered broker-dealer; and (ii) have entered into an Authorized Purchaser Agreement with the Sponsor and the Administrator. The Authorized Purchaser Agreement provides the procedures for the issuance and redemption of Baskets. See "Description of Creation and Redemption of Shares" for additional information. The Trust has engaged Jane Street Capital, LLC, Citadel Securities LLC and Goldman Sachs & Co. LLC, as Authorized Purchasers. Additional Authorized Purchasers may be added at any time, subject to the discretion of the Sponsor. Clearance and settlement: Individual certificates are not issued for the Shares. Rather, Shares are represented by one or more global certificates, which are deposited by the Transfer Agent with the DTC and registered in the name of Cede & Co., as nominee for DTC. The global certificates evidence all of the Shares outstanding at any time. Beneficial interests in Shares are held through DTC s book-entry system. Accordingly, Shareholders are limited to: (1) purchasers in DTC such as banks, brokers, dealers and trust companies, (2) those who maintain, either directly or indirectly, a custodial relationship with a DTC purchaser, and (3) those who hold interests in the Shares through DTC purchasers or indirect purchasers, in each case who satisfy the requirements for transfers of Shares. DTC purchasers acting on behalf of investors holding Shares through such DTC purchasers accounts in DTC will follow the delivery practice applicable to securities eligible for DTC s Same-Day Funds Settlement System. Shares are credited to DTC purchasers securities accounts following confirmation of receipt of payment. Banks may not provide banking services, or may cut off banking services, to businesses that provide digital asset-related services or that accept digital assets as payment, which could dampen liquidity in the market and damage the public perception of digital assets generally or any one digital asset in particular, such as bitcoin, and its utility as a payment system, which could decrease the price of digital assets generally or individually. Further, the lack of availability of banking services could prevent the Fund from being able to complete the timely liquidation of bitcoin and withdrawal of bitcoin from the Bitcoin Custodian even if the Sponsor determined that such liquidation were appropriate or suitable. Certain privacy-preserving features have been or are expected to be introduced to digital asset networks, such as the Bitcoin Network, and exchanges or businesses that facilitate transactions in bitcoin may be at an increased risk of having banking services cut off if there is a concern that these features interfere with the performance of anti-money laundering duties and economic sanctions checks. Users, developers and miners may otherwise switch to or adopt certain digital assets at the expense of their engagement with other digital asset networks, which may negatively impact those networks, including the Bitcoin Network. The value of the Shares is subject to a number of factors relating to the fundamental investment characteristics of bitcoin as a digital asset, including the fact that digital assets are bearer instruments and loss, theft, or compromise of the associated private keys could result in permanent loss of the asset, and the capabilities and development of blockchain technologies such as the Bitcoin Blockchain. Digital assets such as bitcoin were only introduced within the past 15 years, and the value of the Shares is subject to a number of factors over time relating to the capabilities and development of blockchain technologies, such as the recentness of their development, their dependence on the internet and other technologies, their dependence on the roleplayed by users, developers and miners and the potential for malicious activity. Digital asset networks, including the Bitcoin Network and associated Bitcoin Blockchain and the software used to operate them are in the early stages of development. Given the recentness of the development of digital asset networks, digital assets may not function as intended and parties may be unwilling to use digital assets, which would dampen the growth, if any, of digital asset networks. Because bitcoin is a digital asset, the value of the Shares is subject to a number of factors relating to the fundamental investment characteristics of digital assets, including the fact that digital assets are bearer instruments and loss, theft, compromise, or destruction of the associated private keys could result in permanent loss of the asset. For example, the realization of one or more of the following risks could materially adversely affect the value of the Shares: Digital assets, including bitcoin, are controllable only by the possessor of both the unique public key and private key or keys relating to the Bitcoin Network address, or "wallet," at which the digital asset is held. Private keys must be safeguarded and kept private in order to prevent a third party from accessing the digital asset held in such wallet. The loss, theft, compromise or destruction of a private key required to access a digital asset may be irreversible. If a private key is lost, stolen, destroyed or otherwise compromised and no backup of the private key is accessible, the owner would be unable to access the digital asset corresponding to that private key and the private key will not be capable of being restored by the digital asset network resulting in the total loss of the value of the digital asset linked to the private key. Digital asset networks are dependent upon the internet. A disruption of the internet or a digital asset network, such as the Bitcoin Network, would affect the ability to transfer digital assets, including bitcoin, and, consequently, would impact their value. The acceptance of software patches or upgrades by a significant, but not overwhelming, percentage of the users and miners in a digital asset network, such as the Bitcoin Network, could result in a "fork" in such network s blockchain, including the Bitcoin Blockchain, resulting in the operation of multiple separate networks. Governance of the Bitcoin Network is by voluntary consensus and open competition. As a result, there may be a lack of consensus or clarity on the governance of the Bitcoin Network, which may stymie the Bitcoin Network s utility and ability to grow and face challenges. In particular, it may be difficult to find solutions or martial sufficient effort to overcome any future problems on the Bitcoin Network, especially long-term problems. Over the past decade, bitcoin mining operations have evolved from individual users mining with computer processors, graphics processing units and first-generation application specific integrated circuit machines to "professionalized" mining operations using proprietary hardware or sophisticated machines. If the profit margins of bitcoin mining operations are not sufficiently high, including due to an increase in electricity costs or a decline in the market price of bitcoin, or if bitcoin mining operations are unable to arrange alternative sources of financing (e.g., if lenders refuse to make loans to such miners), bitcoin miners are more likely to immediately sell more bitcoin than they otherwise would, resulting in an increase in liquid supply of bitcoin, which would generally tend to reduce bitcoin s market price. To the extent that any miners cease to record transactions that do not include the payment of a transaction fee in solved blocks or do not record a transaction because the transaction fee is too low, such transactions will not be recorded on the Bitcoin Blockchain until a block is mined by a miner who does not require the payment of transaction fees or is willing to accept a lower fee. Any widespread delays in the recording of transactions could result in a loss of confidence in a digital asset network. Digital asset mining operations can consume significant amounts of electricity, which may have a negative environmental impact and give rise to public opinion against allowing, or government regulations restricting, the use of electricity for mining operations. Additionally, miners may be forced to cease operations during an electricity shortage or power outage, or if electricity prices increase where the mining activities are performed. Many digital asset networks, including the Bitcoin Network, face significant scaling challenges and may periodically be upgraded with various features designed to increase the speed and throughput of digital asset transactions. These attempts to increase the volume of transactions may not be effective, and such upgrades may fail, resulting in potentially irreparable damage to the Bitcoin Network and to the value of bitcoin. The open-source structure of many digital asset network protocols, such as the protocol for the Bitcoin Network, means that developers and other contributors are generally not directly compensated for their contributions in maintaining and developing such protocols. As a result, the developers and other contributors of a particular digital asset may lack a financial incentive to maintain or develop the network, or may lack the resources to adequately address emerging issues. Alternatively, some developers may be funded by companies whose interests are at odds with other participants in a particular digital asset network. A failure to properly monitor and upgrade the protocol of the Bitcoin Network could damage that network. Previously, flaws in the source code for digital assets have been exposed and exploited, including flaws that disabled some functionality for users, exposed users personal information and/or resulted in the theft of users digital assets. The cryptography underlying bitcoin could prove to be flawed or ineffective, or developments in mathematics and/or technology, including advances in digital computing, algebraic geometry and quantum computing, could result in such cryptography becoming ineffective. In any of these circumstances, a malicious actor may be able to compromise the security of the Bitcoin Network or take the Fund s bitcoin, which would adversely affect the value of the Shares. Moreover, functionality of the Bitcoin Network may be negatively affected such that it is no longer attractive to users, thereby dampening demand for bitcoin. Even if another digital asset other than bitcoin were affected by similar circumstances, any reduction in confidence in the source code or cryptography underlying digital assets generally could negatively affect the demand for digital assets and therefore adversely affect the value of the Shares. Moreover, because digital assets, including bitcoin, have been in existence for a short period of time and are continuing to develop, there may be additional risks in the future that are impossible to predict as of the date of this prospectus. The open-source structure of the Bitcoin Network protocol means that the core developers and other contributors are generally not directly compensated for their contributions in maintaining and developing the Bitcoin Network protocol. A failure to properly monitor and upgrade the Bitcoin Network protocol could damage the Bitcoin Network and adversely impact the Fund. The Bitcoin Network operates based on an open-source protocol maintained by the core developers and other contributors, largely on the GitHub resource section dedicated to bitcoin development. As bitcoin is rewarded solely for mining activity and are not sold to raise capital for the Bitcoin Network, and the Bitcoin Network protocol itself is made available for free rather than sold or made available subject to licensing or subscription fees and its use does not generate revenues for its development team, the core developers are generally not compensated for maintaining and updating the source code for the Bitcoin Network protocol. Consequently, there is a lack of financial incentive for developers to maintain or develop the Bitcoin Network and the core developers may lack the resources to adequately address emerging issues with the Bitcoin Network protocol. Although the Bitcoin Network is currently supported by the core developers, there can be no guarantee that such support will continue or be sufficient in the future. In addition, a bad actor could also attempt to interfere with the operation of the Bitcoin Network by attempting to exercise a malign influence over a core developer. To the extent that material issues arise with the Bitcoin Network protocol and the core developers and open-source contributors are unable to address the issues adequately or in a timely manner, investments in bitcoin, such as the Fund s, may be adversely affected. Digital asset networks face significant scaling challenges and efforts to increase the volume and speed of transactions may not be successful. Many digital asset networks, including the Bitcoin Network, face significant scaling challenges due to the fact that public blockchains generally face a tradeoff between security and scalability. One means through which public blockchains achieve security is decentralization, meaning that no intermediary is responsible for securing and maintaining these systems. For example, a greater degree of decentralization generally means a given digital asset network is less susceptible to manipulation or capture. A digital asset network may be limited in the number of transactions it can process by the capabilities of each single fully participating node. As corresponding increases in throughput lag behind growth in the use of digital asset networks, average fees and settlement times may increase considerably. For example, the Bitcoin Network has been, at times, at capacity, which has led to increased transaction fees. Increased fees and decreased settlement speeds could preclude certain uses for bitcoin (e.g., micropayments), and could reduce demand for, and the price of, bitcoin, which could adversely impact the value of the Shares. Since January 1, 2019, bitcoin transaction fees have increased from $0.18 per bitcoin transaction, on average, to a high of $60.95 per transaction, on average, on April 20, 2021. In May 2023, events related to the adoption of ordinals, which are a means of inscribing digital content on the Bitcoin Blockchain, caused transaction fees to temporarily spike above $30 per transaction. As of December 31, 2023, bitcoin transaction fees were $4.45 per transaction, on average, over a one-year trailing basis. Average fees and settlement times may also increase when the number of bitcoin awarded for solving a new block is automatically halved every 210,000 blocks. The current fixed reward for solving a new block is 6.25 bitcoin per block; the reward decreased from twenty-five (25) bitcoin in July 2016 and 12.5 in May 2020. The most recent halving occurred in April 2024 and the next estimated halving is expected to occur in 2028. There is no guarantee that any of the mechanisms in place or being explored for increasing the scale of settlement of the Bitcoin Network transactions will be effective, or how long these mechanisms will take to become effective, which could cause the Bitcoin Network to not adequately resolve scaling challenges and adversely impact the adoption of bitcoin as a medium of exchange. Such impact may adversely impact the value of bitcoin and the value of Shares. The scheduled creation of newly mined bitcoin and their subsequent sale may cause the price of bitcoin to decline, which could negatively affect the value of the Fund s Shares. Newly created bitcoin ("newly mined bitcoin") are generated through a process referred to as "mining" which involves the collection of a reward of new bitcoin. As of the date of this prospectus, the Bitcoin Network creates 6.25 bitcoin with each block added to the Blockchain; these newly mined bitcoin are awarded to the bitcoin miner that has added the block to the Blockchain, which occurs on average approximately every 10 minutes. When the recipient makes newly mined bitcoin available for sale, there can be downward pressure on the price of bitcoin as the new supply is introduced into the market. Lower bitcoin prices may result in further tightening of profit margins for miners and decreasing profitability, thereby potentially causing further selling pressure. Diminishing profit margins and increasing sales of newly mined bitcoin could result in a reduction in the price of bitcoin, which could adversely impact an investment in the Shares. In addition, bitcoin mining is highly sensitive to energy prices and digital assets market prices. Bitcoin miners use specialized computers that consume significant amounts of energy. As energy prices fluctuate, the marginal cost of bitcoin mining increases and decreases. Conversely, the price of bitcoin and amount of computational power being expended by other bitcoin miners will impact the profitability and likelihood of solving a block and receiving newly mined bitcoin. If the marginal cost of bitcoin mining exceeds the expected profit, miners may cease to expend energy to mine bitcoin. If a material number of miners turn off their mining hardware, the speed of transaction processing on the Bitcoin Network may experience a temporary slowdown and the overall security of the Bitcoin Network may be reduced. Bitcoin mining consumes large amounts of electricity, and many bitcoin miners rely on fossil fuels to power their operations. Public perception of the impact of bitcoin mining on climate change and/or country-specific or global climate change regulations that cap or ban energy usage may reduce demand for bitcoin and increase the likelihood of regulation that limits bitcoin mining or restricts energy usage by bitcoin miners. Such events could have an impact on the price of bitcoin and the performance of the Fund. The prevailing level of transaction fees may adversely affect the usage of the Bitcoin Network. In addition to the reward of new bitcoin, Bitcoin miners collect fees for each transaction they confirm. Miners validate unconfirmed transactions by adding the previously unconfirmed transactions to new blocks in the Blockchain. Miners are not forced to confirm any specific transaction, but they are economically incentivized to confirm valid transactions as a means of collecting fees. Miners have historically accepted relatively low transaction confirmation fees, because miners have a very low marginal cost of validating unconfirmed transactions. In addition, most iterations of mining software will prioritize transactions recorded based on (i) thresholds selected by the user, (ii) the transaction fee paid with the transaction, (iii) the value attached to the transaction and (iv) the time the transaction was received by the mining software. If miners collude in an anticompetitive manner to not record transactions that pay low transaction fees, then bitcoin users would be required to either wait for their transaction to be included in a block by a miner not requiring such transaction fees or require users pay higher fees to ensure their transactions are recorded promptly, thus reducing the attractiveness of the Bitcoin Network. Bitcoin mining occurs globally, and it may be difficult for authorities to apply antitrust regulations across multiple jurisdictions. Any collusion among miners may adversely impact the value of bitcoin and the value of Shares, as well as the ability of the Fund to operate. If the number of outstanding transactions yet to be recorded in the Blockchain (commonly referred to as "transactions in the mempool") are significantly above the capacity which can be recorded in any single block, miners are likely to prioritize recording transactions that pay significant transaction fees. This would result in transactions with low or no fees remaining in the mempool for extended periods. Such a scenario would further incentivize higher fees paid to ensure their transactions are recorded promptly, thus reducing the attractiveness of the Bitcoin Network. An extended period of large numbers of transactions in the mempool could result from high levels of use of the Bitcoin Network or from a malicious spam attack intending to increase the transactions in the mempool. Any extended period with large numbers of transactions in the mempool may adversely impact the value of the Shares or the ability of the Fund to operate. Additionally, the reward for successful mining transactions (also known as the "block reward") will decrease over time. In May 2020, the block reward was reduced from 12.5 to 6.25 bitcoin, and will further be reduced by half approximately every four years (e.g., to 3.125 bitcoin in 2024). As the block reward continues to decrease over time, the mining incentive structure may transition to a higher reliance on transaction confirmation fees in order to incentivize miners to continue to dedicate processing power to the blockchain. If transaction confirmation fees become too high, the marketplace may be reluctant to use bitcoin. Conversely, if the combination of the block reward and transaction fees are too low, miners may not be incentivized to expend processing power to solve blocks and confirmations of transactions on the Blockchain could be temporarily slowed. A reduction in the processing power expended by miners on the Bitcoin Network could increase the likelihood of a malicious actor or botnet obtaining control. Any reduction in infrastructure security may reduce confidence in the Bitcoin Network or expose the Bitcoin Network to a malicious actor or botnet obtaining a majority of processing power on the Bitcoin Network, reducing the confidence in and security of the Blockchain. Decreased demand for bitcoin or reduced security on the Bitcoin Network may adversely impact the Shares. A temporary or permanent "fork" could adversely affect an investment in the Fund. Additionally, the Fund may not receive the benefit of any forks or "airdrops". The Bitcoin Network operates using open-source protocols, meaning that any user can download the software, modify it and then propose that the users and miners of bitcoin adopt the modification. When a modification is introduced and a substantial majority of users and miners consent to the modification, the change is implemented and the network remains uninterrupted. However, if less than a substantial majority of users and miners consent to the proposed modification, and the modification is not compatible with the software prior to its modification, the consequence would be what is known as a "hard fork" of the Bitcoin Network, with one group running the pre-modified software and the other running the modified software. The effect of such a fork would be the existence of two versions of bitcoin running in parallel on separate networks using separate blockchain ledgers, yet lacking interchangeability. For example, in August 2017, Bitcoin "forked" into Bitcoin and a new digital asset, Bitcoin Cash, as a result of a several-year dispute over how to increase the rate of transactions that the Bitcoin Network can process. Forks may also occur as a network community s response to a significant security breach. For example, in July 2016, Ethereum "forked" into Ethereum and a new digital asset, Ethereum Classic, as a result of the Ethereum network community s response to a significant security breach in which an anonymous hacker exploited a smart contract running on the Ethereum network to syphon approximately $60 million of ETH held by The DAO, a distributed autonomous organization, into a segregated account. In response to the hack, most participants in the Ethereum community elected to adopt a "fork" that effectively reversed the hack. However, a minority of users continued to develop the original blockchain, now referred to as "Ethereum Classic" with the digital asset on that blockchain now referred to as Ethereum Classic, or ETC. ETC now trades on several digital asset exchanges. A fork may also occur as a result of an unintentional or unanticipated software flaw in the various versions of otherwise compatible software that users run. Such a fork could lead to users and miners abandoning the digital asset with the flawed software. It is possible, however, that a substantial number of users and miners could adopt an incompatible version of the digital asset while resisting community-led efforts to merge the two chains. This could result in a permanent fork, as in the case of Ethereum and Ethereum Classic. In addition, many developers have previously initiated hard forks in the Blockchain to launch new digital assets, such as Bitcoin Gold and Bitcoin Diamond. To the extent such digital assets compete with bitcoin, such competition could impact demand for bitcoin and could adversely impact the value of Shares. Furthermore, a hard fork can lead to new security concerns. For example, when the Ethereum and Ethereum Classic networks, two other digital asset networks, split in July 2016, replay attacks, in which transactions from one network were rebroadcast to nefarious effect on the other network, plagued Ethereum exchanges through at least October 2016. An Ethereum exchange announced in July 2016 that it had lost 40,000 Ethereum Classic, worth about $100,000 at that time, as a result of replay attacks. Similar replay attack concerns occurred in connection with the Bitcoin Cash and Bitcoin SV networks split in November 2018. Another possible result of a hard fork is an inherent decrease in the level of security due to significant amounts of mining power remaining on one network or migrating instead to the new forked network. After a hard fork, it may become easier for an individual miner or mining pool s hashing power to exceed 50% of the processing power of a digital asset network that retained or attracted less mining power, thereby making digital assets that rely on proof-of-work more susceptible to attack. A hard fork may adversely affect the price of bitcoin at the time of announcement or adoption. For example, the announcement of a hard fork could lead to increased demand for the pre-fork digital asset, in anticipation that ownership of the pre-fork digital asset would entitle holders to a new digital asset following the fork. The increased demand for the pre-fork digital asset may cause the price of the digital asset to rise. After the hard fork, it is possible the aggregate price of the two versions of the digital asset running in parallel would be less than the price of the digital asset immediately prior to the fork. Furthermore, while the Sponsor will, as permitted by the terms of the Trust Agreement, determine which network is generally accepted as the Bitcoin Network and should therefore be considered the appropriate network for the Fund s purposes, there is no guarantee that the Sponsor will choose the network and the associated digital asset that is ultimately the most valuable fork. Either of these events could therefore adversely impact the value of Shares. A future fork in the Bitcoin Network could adversely affect the portion of the Shares value that is tied to bitcoin or the ability of the Fund to operate. As another example of the effects of hard forks on digital assets, on September 15, 2022, the Ethereum Network completed its Merge, moving from a proof-of-work model to a proof-of-stake model. Ethereum proof-of-work miners who disagreed with the new consensus mechanism forked the network which resulted in the Ethereum proof-of-work network. Ethereum proof-of-work network was driven by a small but vocal group of miners who wished to hold onto revenue as Ethereum switched to proof-of-stake. The vast majority of token holder votes preferred the new proof-of- stake consensus method. There was no material impact on the Ethereum network as a result of the fork. All ether holders were airdropped Ethereum proof-of-work network tokens as a result of the hard fork. However, not all liquidity providers were able to trade the new token and the Ethereum proof-of-work network token almost immediately lost most of its value. In addition to forks, a digital asset may become subject to a similar occurrence known as an "airdrop." In an airdrop, the promoters of a new digital asset announce to holders of another digital asset that such holders will be entitled to claim a certain amount of the new digital asset for free, based on the fact that they hold such other digital asset. For example, in March 2017 the promoters of Stellar Lumens announced that anyone that owned bitcoin as of June 26, 2017 could claim, until August 27, 2017, a certain amount of Stellar Lumens. Airdrops could create operational security, legal or regulatory, or other risks for the Fund, the Sponsor, the Bitcoin Custodian, Authorized Purchasers or other entities. An "Incidental Right" is the right to receive any benefit of a fork, airdrop or similar event, and any such virtual currency (other than bitcoin) acquired through an Incidental Right is an "IR Virtual Currency." With respect to a fork, airdrop or similar event, the Sponsor will cause the Fund to irrevocably abandon the Incidental Rights and any IR Virtual Currency associated with such event. As such, Shareholders will not receive the benefits of any Incidental Rights and any IR Virtual Currency. In the event the Fund seeks to change its policy with respect to the Incidental Rights or IR Virtual Currency, an application would need to be filed with the SEC by the Exchange seeking approval to amend its listing rules to permit the Fund to sell Incidental Rights or IR Virtual Currency and distribute the cash proceeds (net of expenses and applicable withholding taxes) to DTC or distribute the Incidental Rights or IR Virtual Currency in-kind to DTC. However, there can be no assurance as to whether or when the Sponsor would make such a decision, or when the Exchange would seek or obtain this approval, if at all. Even if such regulatory approval is sought and obtained, Shareholders may not receive the benefits of a fork, the Trust may not choose, or be able, to participate in an airdrop, and the timing of receiving any benefits from a fork, airdrop or similar event is uncertain. Any inability to recognize the economic ability of a hard fork or airdrop could adversely affect the value of the Shares. Investors who prefer to have a greater degree of control over events such as forks, airdrops, and similar events, and any assets made available in connection with each, should consider investing in bitcoin directly rather than purchasing Shares. A hard fork could change the source code to the Bitcoin Network, including the 21 million bitcoin supply cap. In principle a hard fork could change the source code for the Bitcoin Network, including the source code which limits the supply of bitcoin to 21 million. Although many observers believe this is unlikely at present, there is no guarantee that the current 21 million supply cap for outstanding bitcoin, which is estimated to be reached by approximately the year 2140, will not be changed. If a hard fork changing the 21 million supply cap is widely adopted, the limit on the supply of bitcoin could be lifted, which could have an adverse impact on the value of bitcoin and the portion of the Shares value that is tied to bitcoin. In the event of a hard fork of the Bitcoin Network, the Sponsor will, if permitted by the terms of the Trust Agreement, use its discretion to determine which network should be considered the appropriate network for the Fund s purposes, and in doing so may adversely affect the value of Shares. In the event of a hard fork of the Bitcoin Network, the Sponsor will, as permitted by the terms of the Trust Agreement, use its sole discretion to determine, in good faith, which peer-to-peer network, among a group of incompatible forks of the Bitcoin Network, is generally accepted as the Bitcoin Network and should therefore be considered the appropriate network for the Fund s purposes. The Sponsor will base its determination on whatever factors it deems relevant, including but not limited to, the Sponsor s beliefs regarding expectations of the core developers of bitcoin, users, services, businesses, miners and other constituencies, as well as the actual continued acceptance of, mining power on, and community engagement with, the Bitcoin Network, or whatever other factors it deems relevant. There is no guarantee that the Sponsor will choose the digital asset that is ultimately the most valuable fork, and the Sponsor s decision may adversely affect the portion of the Shares value that is tied to bitcoin as a result. The Sponsor may also disagree with Shareholders, the Bitcoin Custodian, other service providers, Kaiko, cryptocurrency exchanges, or other market participants on what is generally accepted as bitcoin and should therefore be considered "bitcoin" for the Fund s purposes, which may also adversely affect the value of Shares. If a malicious actor or botnet obtains control of more than 50% of the processing power on the Bitcoin Network, or otherwise obtains control over the Bitcoin Network through its influence over core developers or otherwise, such actor or botnet could manipulate how data is recorded the Blockchain to adversely affect the value of Shares and/or the ability of the Fund to operate. If a malicious actor or botnet (a volunteer or hacked collection of computers controlled by networked software coordinating the actions of the computers) obtains control of more than 50% of the processing power dedicated to mining on the Bitcoin Network, it may be able to alter the Blockchain on which transactions in bitcoin rely by constructing fraudulent blocks or preventing certain transactions from completing in a timely manner, or at all. The malicious actor or botnet could also control, exclude or modify the ordering of transactions. Although the malicious actor or botnet would not be able to generate new bitcoin or transactions using such control, it could "double-spend" its own tokens (i.e., spend the same tokens in more than one transaction) and prevent the confirmation of other users transactions for so long as it maintained control. To the extent that such a malicious actor or botnet did not yield its control of the processing power on the Bitcoin Network or the bitcoin community did not reject the fraudulent blocks as malicious, reversing any changes made to the Blockchain may not be possible. Further, a malicious actor or botnet could create a flood of transactions in order to slow down the Bitcoin Network or cause an increase in the transaction fees paid by users to confirm transactions. Although there are no known reports of malicious parties taking control of the Bitcoin Network, it is believed that certain mining pools may have exceeded the 50% threshold on the Bitcoin Network on a temporary basis. The possible crossing of the 50% threshold indicates a greater risk that a single mining pool could exert authority over the validation of bitcoin transactions, and this risk is heightened if over 50% of the processing power on the network falls within the jurisdiction of a single governmental authority. For example, it is believed that more than 50% of the processing power on the Bitcoin Network may be located in China. Because the Chinese government has subjected digital assets to heightened levels of scrutiny recently, reportedly forcing several digital asset exchanges to shut down, there is a risk that the Chinese government could also achieve control over more than 50% of the processing power on the Bitcoin Network. If network participants, including the core developers and the administrators of mining pools, do not act to ensure greater decentralization of bitcoin mining processing power, the feasibility of a malicious actor obtaining control of the processing power on the Bitcoin Network will increase, which may adversely affect the value of Shares. Additionally, if miners experience financial or other difficulties on a large scale and are unable to participate in mining activities, the risks of the Bitcoin Network becoming more centralized, and therefore more susceptible to malicious actor control, could increase. A malicious actor may also obtain control over the Bitcoin Network through its influence over core developers by gaining direct control over a core developer or an otherwise influential programmer. To the extent that the bitcoin ecosystem does not grow, the possibility that a malicious actor may be able to obtain control of the processing power or development control on the Bitcoin Network will remain heightened. Additionally, to the extent that users and miners accept amendments to the source code proposed by the controlled core developer, other core developers do not counter such amendments, and such amendments enable the malicious exploitation of the Bitcoin Network, the risk that a malicious actor may be able to obtain control of the Bitcoin Network in this manner exists. The Fund is subject to risks as a result of investing approximately 80% of its assets in a single asset: bitcoin. Any decreases in the value of bitcoin or disruption of the bitcoin trading markets, generally, will adversely impact the value of Shares. The Fund may be more volatile than an investment in a more broadly diversified portfolio. The Fund s investment strategy includes the Fund concentrating 80% of its assets in bitcoin. Accordingly, the Fund s holdings are not diversified. The Fund s value is therefore more susceptible to adverse impacts to bitcoin than other, more diversified funds. Fluctuations in the price of bitcoin are expected to directly impact the value of Shares. The Fund s NAV may be more volatile than an investment vehicle with a more broadly diversified portfolio and may experience significant fluctuations over either a short or long period of time. 80% of the Fund s investments are in bitcoin, and the value of Shares will be significantly impacted by the value of bitcoin. Bitcoin s value may be highly volatile and subject to fluctuations due to a number of factors. 80% of the value of the Fund is invested in bitcoin, and the value of Shares will be significantly impacted by the value of bitcoin. Fluctuations in the value of bitcoin could adversely, and significantly, affect the value of Shares. The market price of bitcoin may be highly volatile, and subject to a number of factors, including: an increase in the global bitcoin supply or a decrease in global bitcoin demand; market conditions of, and overall sentiment towards, the digital assets and blockchain technology industry; trading activity on digital asset exchanges, which, in many cases, are largely unregulated or may be subject to manipulation; the adoption of bitcoin as a medium of exchange, store-of-value or other consumptive asset and the maintenance and development of the open-source software protocol of the Bitcoin Network, and their ability to meet user demands; forks in the Bitcoin Network; investors expectations with respect to interest rates, the rates of inflation of fiat currencies or bitcoin, and digital asset exchange rates; consumer preferences and perceptions of bitcoin specifically and digital assets generally; negative events, publicity, and social media coverage relating to the digital assets and blockchain technology industry; fiat currency withdrawal and deposit policies on digital asset exchanges; the liquidity of digital asset markets and any increase or decrease in trading volume or market making on digital asset markets; business failures, bankruptcies, hacking, fraud, crime, government investigations, or other negative developments affecting digital asset businesses, including digital asset exchanges, or banks or other financial institutions and service providers which provide services to the digital assets industry; the use of leverage in digital asset markets, including the unwinding of positions, "margin calls," collateral liquidations and similar events; investment and trading activities of large or active consumer and institutional users, speculators, miners, and investors in bitcoin; an active derivatives market for bitcoin or for digital assets generally; monetary policies of governments, legislation or regulation, trade restrictions, currency devaluations and revaluations and regulatory measures or enforcement actions, if any, that restrict the use of bitcoin as a form of payment or the purchase of bitcoin on the digital asset markets; global or regional political, economic or financial conditions, events and situations, such as a novel coronavirus outbreak; fees associated with processing a bitcoin transaction and the speed at which bitcoin transactions are settled; the maintenance, troubleshooting, and development of the Bitcoin Network including by miners and developers worldwide; the ability for the Bitcoin Network to attract and retain miners to secure and confirm transactions accurately and efficiently; ongoing technological viability and security of the Bitcoin Network and bitcoin transactions, including vulnerabilities against hacks and scalability; financial strength of market participants; the availability and cost of funding and capital; the liquidity and credit risk of digital asset platforms; interruptions in service from or closures or failures of major digital asset exchanges or their banking partners, or outages or system failures affecting the Bitcoin Network; decreased confidence in digital assets and digital assets exchanges; poor risk management or fraud by entities in the digital assets ecosystem; increased competition from other forms of digital assets or payment services; and the Fund s own acquisitions or dispositions of bitcoin, since there is no limit on the number of bitcoin that the Fund may acquire. There is no assurance that bitcoin will maintain its value in the long, intermediate, short, or any other term. In the event that the price of bitcoin declines, the Shares value will also decline. The value of a bitcoin as represented by the Bitcoin Price may also be subject to momentum pricing due to speculation regarding future appreciation in value, leading to greater volatility that could adversely affect the value of the Shares. Momentum pricing typically is associated with growth stocks and other assets whose valuation, as determined by the investing public, accounts for future appreciation in value, if any. The Sponsor believes that momentum pricing of bitcoin has resulted, and may continue to result, in speculation regarding future appreciation in the value of bitcoin, inflating and making the Index more volatile. As a result, bitcoin may be more likely to fluctuate in value due to changing investor confidence, which could adversely affect the value of Shares. Bitcoin ownership is concentrated in a small number of holders referred to as "Whales." A significant portion of bitcoin is held by a small number of holders who have the ability to affect the price of bitcoin and who are sometimes referred to as "whales." Because bitcoin is lightly regulated, bitcoin whales have the ability, alone or in coordination, to manipulate the price of bitcoin by restricting or expanding the supply of bitcoin. Activities of bitcoin whales that reduce user confidence in bitcoin, the Bitcoin Network or the fairness of bitcoin trading venues, or that affect the price of bitcoin, could have a negative impact on the portion of the Shares value that is tied to bitcoin. Due to the unregulated nature and lack of transparency surrounding the operations of digital asset exchanges, they may experience fraud, security failures or operational problems, which may adversely affect the value of bitcoin and, consequently, the value of Shares. Digital asset exchanges are relatively new and, in some cases, unregulated. Furthermore, while many prominent digital asset exchanges provide the public with significant information regarding their ownership structure, management teams, corporate practices and regulatory compliance, many digital asset exchanges do not provide this information. Digital asset exchanges do not appear to be subject to, or may not comply with, regulation in a similar manner as other regulated trading platforms, such as national securities exchanges or designated contract markets. As a result, the marketplace may lose confidence in digital asset exchanges, including prominent exchanges that handle a significant volume of bitcoin trading. Many digital asset exchanges are unlicensed, unregulated, operate without extensive supervision by governmental authorities, and do not provide the public with significant information regarding their ownership structure, management team, corporate practices, cybersecurity, and regulatory compliance. In particular, those located outside the United States may be subject to significantly less stringent regulatory and compliance requirements in their local jurisdictions. As a result, trading activity on or reported by these digital asset exchanges is generally significantly less regulated than trading in regulated U.S. securities and commodities markets, and may reflect behavior that would be prohibited in regulated U.S. trading venues. For example, in 2019 there were reports claiming that 80.95% of bitcoin trading volume on digital asset exchanges was false or noneconomic in nature, with specific focus on unregulated exchanges located outside of the United States engaging in a variety of manipulative or fraudulent activities. Nonetheless, any actual or perceived false trading in the digital asset exchange market, and any other fraudulent or manipulative acts and practices, could adversely affect the value of bitcoin and/or negatively affect the market perception of bitcoin. The bitcoin market globally and in the United States is not subject to the regulatory guardrails that exist in the regulated securities markets nor the safeguards put in place by exchanges for more traditional assets to enhance the stability of trading on exchanges and prevent "flash crashes." Tools to detect and deter fraudulent or manipulative trading activities such as market manipulation, front-running of trades, and wash-trading, may not be available to or employed by digital asset exchanges, or may not exist at all. The effect of these could inflate volumes in the digital asset markets and/or cause distortions in price, which could adversely affect the Fund. In addition, over the past several years, some digital asset exchanges have been closed due to fraud and manipulative activity, business failure or security breaches. In many of these instances, the customers of such digital asset exchanges were not compensated or made whole for the partial or complete losses of their account balances in such digital asset exchanges. While, generally speaking, smaller digital asset exchanges are less likely to have the infrastructure and capitalization that make larger digital asset exchanges more stable, larger digital asset exchanges are more likely to be appealing targets for hackers and malware and may be more likely to be targets of regulatory enforcement action. For example, in November 2022, FTX Trading Ltd. ("FTX"), one of the largest digital asset exchanges by volume at the time, halted customer withdrawals amid rumors of the company s liquidity issues and likely insolvency, which were subsequently corroborated by its CEO. Shortly thereafter, FTX s CEO resigned and FTX and many of its affiliates filed for bankruptcy in the United States, while other affiliates have entered insolvency, liquidation, or similar proceedings around the globe, following which the U.S. Department of Justice brought criminal fraud and other charges, and the SEC and CFTC brought civil securities and commodities fraud charges, against certain of FTX s and its affiliates senior executives, including its former CEO. Around the same time, there were reports that approximately $300-600 million of digital assets were removed from FTX and the full facts remain unknown, including whether such removal was the result of a hack, theft, insider activity, or other improper behavior. Negative perception, a lack of stability in the digital asset markets and the closure or temporary shutdown of digital asset exchanges due to fraud, failure or security breaches may reduce confidence in the Bitcoin Network and result in greater volatility or decreases in the prices of bitcoin. Furthermore, the closure or temporary shutdown of one of the digital asset exchanges used in calculating the value of bitcoin by the Index may result in a loss of confidence in the Fund s ability to determine its NAV on a daily basis. The potential consequences of a digital asset exchange s failure could adversely affect the value of the Shares. The value of bitcoin may be subject to momentum pricing whereby the current bitcoin price may account for speculation regarding future appreciation in value. Momentum pricing with respect to bitcoin may result in greater volatility and adversely affect the value of Shares. Momentum pricing typically is associated with growth stocks and other assets whose valuation, as determined by the investing public, accounts for anticipated future appreciation in value. The Sponsor believes that momentum pricing of bitcoin has resulted, and may continue to result, in speculation regarding future appreciation in the value of bitcoin, inflating and making more volatile the price of bitcoin. As a result, bitcoin may be more likely to fluctuate in value due to changing investor confidence in future appreciation (or depreciation) in the price of bitcoin, which could adversely affect the portion of the Shares value that is tied to bitcoin. The Shares may trade at a discount or premium in the trading price relative to the Fund s NAV on a per Share basis as a result of non-concurrent trading hours between the Exchange and the Bitcoin Platform Markets. The value of a Share may be influenced by non-concurrent trading hours between the Exchange and various Bitcoin Platforms, including those that represent components of the Index. While the Exchange is open for trading in the Shares for a limited period each day, the Bitcoin Platform Market is a 24-hour marketplace; however, trading volume and liquidity on the Bitcoin Platform Market is not consistent throughout the day and Bitcoin Platforms, including the larger-volume markets, have been known to shut down temporarily or permanently due to security concerns, directed denial of service attacks and distributed denial of service attacks (coordinated hacking attempts to disrupt websites, web servers or computer networks in which an attacker bombards an online target with a large quantity of external requests, thus precluding the target from processing requests from genuine users) and other reasons. As a result, during periods when the Exchange is open but large Bitcoin Platforms (or a substantial number of smaller Bitcoin Platforms) are either lightly traded or are closed, trading spreads and the resulting premium or discount on the Shares may widen and, therefore, increase the difference between the price of the Shares and the Fund s Holdings per Share. Premiums or discounts may have an adverse effect on an investment in the Shares if a Shareholder sells or acquires its Shares during a period of discount or premium, respectively. If bitcoin prices on the Bitcoin Platform Market move negatively during hours when the Exchange is closed, trading prices on the Exchange may "gap" down at market open. The value of a Share may be influenced by non-concurrent trading hours between the Exchange and various Bitcoin Platforms, including those that represent components of the Index. While the Exchange is open for trading in the Shares for a limited period each day, the Bitcoin Platform Market is a 24-hour marketplace. During periods when the Exchange is closed but Bitcoin Platforms are open, significant changes in the price of bitcoin on the Bitcoin Platform Market could result in a difference in performance between the value of bitcoin as measured by the Index and the most recent Holdings per Share or closing trading price. To the extent that the price of bitcoin on the Bitcoin Platform Market, and the value of bitcoin as measured in part by the Index, moves significantly in a negative direction after the close of the Exchange, the trading price of the Shares may "gap" down to the full extent of such negative price shift when the Exchange reopens. To the extent that the price of bitcoin on the Bitcoin Platform Market drops significantly during hours the Exchange is closed, investors may not be able to sell their Shares until after the "gap" down has been fully realized, resulting in an inability to mitigate losses in a rapidly negative market. RISK FACTORS You should consider carefully the risks described below before making an investment decision. You should also refer to the other information included in this prospectus, including the Trust s financial statements and related notes thereto. Risks Related to Bitcoin, the Bitcoin Network, and Bitcoin Trading Markets The trading prices of many digital assets, including bitcoin, have experienced extreme volatility in recent periods and may continue to do so. Extreme volatility in the future, including further declines in the trading prices of bitcoin, could have a material adverse effect on the value of the Shares and the Shares could lose significant value. The trading prices of many digital assets, including bitcoin, have experienced extreme volatility in recent periods and may continue to do so. For instance, there were steep increases in the value of certain digital assets, including bitcoin, over the course of 2021, and multiple market observers asserted that digital assets were experiencing a "bubble." These increases were followed by steep drawdowns throughout 2022 in digital asset trading prices, including for bitcoin. These episodes of rapid price appreciation followed by steep drawdowns have occurred multiple times throughout bitcoin s history, including in 2011, 2013-2014, and 2017-2018, before repeating again in 2021-2022. Over the course of 2023 and 2024, bitcoin prices have continued to exhibit extreme volatility. The price of bitcoin reached new all-time highs in January 2025. Extreme volatility may persist and the portion of the Shares value that is tied to bitcoin may significantly decline in the future without recovery. The digital asset markets may still be experiencing a bubble or may experience a bubble again in the future. For example, in the first half of 2022, each of Celsius Network, Voyager Digital Ltd., and Three Arrows Capital declared bankruptcy, resulting in a loss of confidence in participants of the digital asset ecosystem and negative publicity surrounding digital assets more broadly. In November 2022, FTX Trading Ltd. ("FTX"), one of the largest digital asset exchanges by volume at the time, halted customer withdrawals amid rumors of the company s liquidity issues and likely insolvency, which were subsequently corroborated by its CEO. Shortly thereafter, FTX s CEO resigned and FTX and many of its affiliates filed for bankruptcy in the United States, while other affiliates have entered insolvency, liquidation, or similar proceedings around the globe, following which the U.S. Department of Justice brought criminal fraud and other charges, and the SEC and CFTC brought civil securities and commodities fraud charges, against certain of FTX s and its affiliates senior executives, including its former CEO. In addition, several other entities in the digital asset industry filed for bankruptcy following FTX s bankruptcy filing, such as BlockFi Inc. and Genesis Global Capital, LLC ("Genesis"). In response to these events (collectively, the "2022 Events"), the digital asset markets have experienced extreme price volatility and other entities in the digital asset industry have been, and may continue to be, negatively affected, further undermining confidence in the digital asset markets. These events have also negatively impacted the liquidity of the digital asset markets as certain entities affiliated with FTX engaged in significant trading activity. If the liquidity of the digital asset markets continues to be negatively impacted by these events, digital asset prices, including bitcoin, may continue to experience significant volatility or price declines and confidence in the digital asset markets may be further undermined. In addition, regulatory and enforcement scrutiny has increased, including from, among others, the Department of Justice, the SEC, the CFTC, the White House and Congress, as well as state regulators and authorities. These events are continuing to develop and the full facts are continuing to emerge. It is not possible to predict at this time all of the risks that they may pose to the Fund, its service providers or to the digital asset industry as a whole. Extreme volatility in the future, including further declines in the trading prices of bitcoin, could have a material adverse effect on the value of the Shares and the Shares could lose a material amount of their value. Digital assets represent a new and rapidly evolving industry, and the value of the Shares in part depends on the acceptance of bitcoin. The Bitcoin Network was first launched in 2009 and bitcoin was the first cryptographic digital assets created to gain global adoption and critical mass. Although the Bitcoin Network is the most established digital asset network, the Bitcoin Network and other cryptographic and algorithmic protocols governing the issuance of digital assets represent a new and rapidly evolving industry that is subject to a variety of factors that are difficult to evaluate. For example, the realization of one or more of the following risks could materially adversely affect the price of bitcoin and therefore the value of Shares: Bitcoin has only recently become selectively accepted as a means of payment by retail and commercial outlets, and use of bitcoin by consumers to pay such retail and commercial outlets remains limited. Banks and other established financial institutions may refuse to process funds for bitcoin transactions; process wire transfers to or from digital asset exchanges, bitcoin-related companies or service providers; or maintain accounts for persons or entities transacting in bitcoin. As a result, the prices of bitcoin may be primarily determined by speculators and miners, thus contributing to price volatility that makes retailers less likely to accept it as a form of payment in the future. A possible "short squeeze" due to a sudden increase in demand for the Shares that largely exceeds supply may lead to price volatility in the Shares. Investors may purchase Shares to hedge existing bitcoin or other digital currencies, commodity or currency exposure or to speculate on the price of bitcoin. Speculation on the price of bitcoin may involve long and short exposures. To the extent that aggregate short exposure exceeds the number of Shares available for purchase (for example, in the event that large redemption requests by Authorized Purchasers dramatically affect Share liquidity), investors with short exposure may have to pay a premium to repurchase Shares for delivery to Share lenders. Those repurchases may, in turn, dramatically increase the price of the Shares until additional Shares are created through the creation process. This is often referred to as a "short squeeze." A short squeeze could lead to volatile price movements in the portion of the Shares value that is tied to bitcoin that are not directly correlated to the price of bitcoin. Competition from the emergence or growth of other digital assets or methods of investing in bitcoin could have a negative impact on the price of bitcoin and adversely affect the value of Shares. Bitcoin was the first digital asset to gain global adoption and critical mass, and as a result, it has a "first to market" advantage over other digital assets. As of December 31, 2024, bitcoin was the largest digital asset by market capitalization and had the largest user base and largest combined mining power. Despite this first to market advantage, as of December 31, 2024, there were over 16,800 alternative digital assets tracked by CoinGecko.com, having a total market capitalization of approximately $3.7 trillion (including the approximately $2.06 trillion market capitalization of bitcoin), as calculated using market prices and total available supply of each digital asset. In addition, many consortiums and financial institutions are also researching and investing resources into private or permissioned smart contract platforms rather than open platforms like the Bitcoin Network. Competition from the emergence or growth of alternative digital assets and smart contracts platforms, such as Ethereum, Solana, Avalanche, Polkadot, or Cardano, could have a negative impact on the demand for, and price of, bitcoin and thereby adversely affect the value of the Shares. In addition, some digital asset networks, including the Bitcoin Network, may be the target of ill will from users of other digital asset networks. For example, Litecoin is the result of a hard fork of bitcoin. Some users of the Bitcoin Network may harbor ill will toward the Litecoin network, and vice versa. These users may attempt to negatively impact the use or adoption of the Bitcoin Network. Investors may invest in bitcoin through means other than the Shares, including through direct investments in bitcoin and other potential financial vehicles, possibly including securities backed by or linked to bitcoin and digital asset financial vehicles similar to the Fund. In addition, to the extent digital asset financial vehicles other than the Fund tracking the price of bitcoin are formed and represent a significant proportion of the demand for bitcoin, large purchases or redemptions of the securities of these digital asset financial vehicles, or private funds holding bitcoin, could negatively affect the Index and the portion of the Shares value that is tied to bitcoin. The impact of geopolitical or economic events on the supply and demand for bitcoin is uncertain, but could motivate large-scale sales of bitcoin, which could result in a reduction in the Bitcoin Price and adversely affect the value of Shares. As an alternative to fiat currencies that are backed by central governments, digital assets such as bitcoin, which are relatively new, are subject to supply and demand forces based upon the desirability of an alternative, decentralized means of buying and selling goods and services, and it is unclear how such supply and demand will be impacted by geopolitical events. Nevertheless, political or economic crises may motivate large-scale acquisitions or sales of bitcoin either globally or locally. Large-scale sales of bitcoin would result in a reduction in the Bitcoin Price and could adversely affect the portion of the Shares value that is tied to bitcoin. Demand for bitcoin is driven, in part, by its status as the most prominent and secure digital asset. It is possible that a digital asset other than bitcoin could have features that make it more desirable to a material portion of the digital asset user base, resulting in a reduction in demand for bitcoin, which could have a negative impact on the price of bitcoin and adversely affect the value of Shares. Bitcoin was the first digital asset to gain global adoption and critical mass, and as a result, it has a "first to market" advantage over other digital assets. As of December 31, 2024, bitcoin was the largest digital asset by market capitalization and had the largest user base and largest combined mining power. Despite this first to market advantage, as of December 31, 2024, there were over 16,800 alternative digital assets tracked by CoinGecko.com, having a total market capitalization of approximately $3.7 trillion (including the approximately $2.06 trillion market capitalization of bitcoin), as calculated using market prices and total available supply of each digital asset. In addition, many consortiums and financial institutions are also researching and investing resources into private or permissioned smart contract platforms rather than open platforms like the Bitcoin Network. Competition from the emergence or growth of alternative digital assets and smart contracts platforms, such as Ethereum, Solana, Avalanche, Polkadot, or Cardano, could have a negative impact on the demand for, and price of, bitcoin and thereby adversely affect the value of the Shares. Investors may invest in bitcoin through means other than the Shares, including through direct investments in bitcoin and other potential financial vehicles, possibly including securities backed by or linked to bitcoin and digital asset financial vehicles similar to the Fund. In addition, to the extent digital asset financial vehicles other than the Fund tracking the price of bitcoin are formed and represent a significant proportion of the demand for bitcoin, large purchases or redemptions of the securities of these digital asset financial vehicles, or private funds holding bitcoin, could negatively affect the Index and the portion of the Shares value that is tied to bitcoin. Risks Related to the Custody of Bitcoin Failure to safeguard and manage our digital assets could adversely impact the Fund s business, operating results, and financial condition. The Fund s success and the success of its offerings requires significant public confidence in the Fund s and its partners abilities to properly manage customers balances and handle large and growing transaction volumes and amounts of customer assets. In addition, the Fund is dependent on its partners operations, liquidity, and financial condition for the proper maintenance, use, and safekeeping of these customer assets. Any failure by the Fund or its partners to maintain the necessary controls or to manage customer digital assets and funds appropriately and in compliance with applicable regulatory requirements could result in reputational harm, significant financial losses, lead customers to discontinue or reduce their use of the Fund s and its partners products, and result in significant penalties and fines and additional restrictions, which could adversely impact the Fund s business, operating results, and financial condition. The Bitcoin Custodian is responsible for the proper deposit, transfer, and custody of digital assets in multiple jurisdictions. The Bitcoin Custodian is required to safeguard customers assets using bank-level security standards. The Fund s security technology is designed to prevent, detect, and mitigate inappropriate access to its systems, by internal or external threats. The Fund believes the Bitcoin Custodian has developed and maintained administrative, technical, and physical safeguards designed to comply with applicable legal requirements and industry standards. However, it is nevertheless possible that hackers, employees or service providers acting contrary to the Bitcoin Custodian s policies, or others could circumvent these safeguards to improperly access the Fund s systems or documents, or the systems or documents of its business partners, agents, or service providers, and improperly access, obtain, misuse digital assets and funds. The methods used to obtain unauthorized access, disable, or degrade service or sabotage systems are also constantly changing and evolving and may be difficult to anticipate or detect for long periods of time. Any security incident resulting in a compromise of customer assets could result in substantial costs to the Fund and require the Fund to notify impacted individuals, and in some cases regulators, of a possible or actual incident, expose the Fund to regulatory enforcement actions, including substantial fines, limit the Fund s ability to provide services, subject the Fund to litigation, significant financial losses, damage the Fund s reputation, and adversely affect the Fund s business, operating results, financial condition, and cash flows. The loss or destruction of a private key required to access bitcoin may be irreversible. The Bitcoin Custodian s loss of access to a private key associated with the Fund s bitcoin could adversely affect an investment in the Shares. Transfers of bitcoin among users are accomplished via bitcoin transactions (i.e., sending bitcoin from one user to another). The creation of a bitcoin transaction requires the use of a unique numerical code known as a "private key." In the absence of the correct private key corresponding to a holder s particular bitcoin, the bitcoin is inaccessible. The custody of the Fund s bitcoin is collectively handled by the Bitcoin Custodian. If the internal procedures and controls of the Bitcoin Custodian are inadequate to safeguard the Fund s bitcoin holdings, and the Fund s private keys are lost, destroyed or otherwise compromised and no backup of the private keys is accessible, the Fund will be unable to access its bitcoin, which could adversely affect an investment in the Shares. In addition, if the Fund s private keys are misappropriated and the Fund s bitcoin holdings are stolen, the Fund could lose some or all of its bitcoin holdings, which could adversely impact the Fund. Security threats to the Fund s account at the Bitcoin Custodian could result in the halting of Fund operations and a loss of Fund assets or damage to the reputation of the Fund, each of which could result in a reduction in the value of the Shares. Security breaches, computer malware and computer hacking attacks have been a prevalent concern in relation to digital assets. The Sponsor believes that the Fund s bitcoin held in the Fund s account at the Bitcoin Custodian will be an appealing target to hackers or malware distributors seeking to destroy, damage or steal the Fund s bitcoin and will only become more appealing as the Fund s assets grow. To the extent that the Fund, the Sponsor or the Bitcoin Custodian is unable to identify and mitigate or stop new security threats or otherwise adapt to technological changes in the digital asset industry, the Fund s bitcoin may be subject to theft, loss, destruction or other attack. The Sponsor believes that the security procedures in place for the Fund, including but not limited to, offline storage, or cold storage, multiple encrypted private key "shards," and other measures, are reasonably designed to safeguard the Fund s bitcoin. Nevertheless, the security procedures cannot guarantee the prevention of any loss due to a security breach, software defect or act of God that may be borne by the Fund and the security procedures may not protect against all errors, software flaws or other vulnerabilities in the Fund s technical infrastructure, which could result in theft, loss or damage of its assets. The Sponsor does not control the Bitcoin Custodian s operations or their implementation of such security procedures and there can be no assurance that such security procedures will actually work as designed or prove to be successful in safeguarding the Fund s assets against all possible sources of theft, loss or damage. Assets not held in cold storage, such as assets held in a trading account, may be more vulnerable to security breach, hacking or loss than assets held in cold storage. The security procedures and operational infrastructure may be breached due to the actions of outside parties, error or malfeasance of an employee of the Sponsor, the Bitcoin Custodian, or otherwise, and, as a result, an unauthorized party may obtain access to the Fund s account at the Bitcoin Custodian, the relevant private keys (and therefore bitcoin) or other data or property of the Fund. Additionally, outside parties may attempt to fraudulently induce employees of the Sponsor or the Bitcoin Custodian to disclose sensitive information in order to gain access to the Fund s infrastructure. As the techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently, or may be designed to remain dormant until a predetermined event and often are not recognized until launched against a target, the Sponsor and the Bitcoin Custodian may be unable to anticipate these techniques or implement adequate preventative measures. An actual or perceived breach of the Fund s account at the Bitcoin Custodian could harm the Fund s operations, result in partial or total loss of the Fund s assets, resulting in a reduction or destruction in the value of the Shares. The Fund may also cease operations, the occurrence of which could similarly result in a reduction in the value of the Shares. Bitcoin transactions are irrevocable and stolen or incorrectly transferred bitcoin may be irretrievable. As a result, any incorrectly executed bitcoin transactions could adversely affect an investment in the Shares. Bitcoin transactions are typically not reversible without the consent and active participation of the recipient of the transaction. Once a transaction has been verified and recorded in a block that is added to the Blockchain, an incorrect transfer or theft of bitcoin generally will not be reversible, and the Fund may not be capable of seeking compensation for any such transfer or theft. Although the Fund s transfers of bitcoin will regularly be made to or from the Bitcoin Account, it is possible that, through computer or human error, or through theft or criminal action, the Fund s bitcoin could be transferred from the Bitcoin Account in incorrect amounts or to unauthorized third parties, or to uncontrolled accounts. To the extent that the Fund is unable to seek a corrective transaction with a third-party recipient of an unauthorized or incorrect transaction or is incapable of identifying the third party which has received the Fund s bitcoin through error or theft, the Fund will be unable to revert or otherwise recover incorrectly transferred bitcoin. The Fund will also be unable to convert or recover its bitcoin transferred to uncontrolled accounts. To the extent that the Fund is unable to seek redress for such error or theft, such loss could adversely affect the portion of the Shares value that is tied to bitcoin. The lack of full insurance and Shareholders limited rights of legal recourse against the Fund, Trustee, Sponsor, Trust Administrator, and Bitcoin Custodian expose the Fund and its Shareholders to the risk of loss of the Fund s bitcoin for which no person or entity is liable. The Fund is not a banking institution or otherwise a member of the Federal Deposit Insurance Corporation ("FDIC") or Securities Investor Protection Corporation ("SIPC") and, therefore, neither, Shareholders cannot be assured that the Bitcoin Custodian will maintain adequate insurance, that such coverage will cover losses with respect to the Fund s bitcoins, or that sufficient insurance proceeds will be available to cover the Fund s losses in full. The Bitcoin Custodian s insurance may not cover the type of losses experienced by the Fund. Alternatively, the Fund may be forced to share such insurance proceeds with other clients or customers of the Bitcoin Custodian, which could reduce the amount of such proceeds that are available to the Fund. The Fund is not a named insured under the Bitcoin Custodian s insurance policies, though the Bitcoin Custodian has represented to the Sponsor that the insurance covers customer losses, including losses suffered by the Fund, arising from specified events, including fraud, theft, and cyber-security breaches. In addition, the bitcoin insurance market is limited, and the level of insurance maintained by the Bitcoin Custodian may be substantially lower than the assets of the Fund, or the amount of claims against the Bitcoin Custodian of all of the customers whose losses are covered by the Bitcoin Custodian s insurance coverage. While the Bitcoin Custodian maintains certain capital reserve requirements depending on the assets under custody, and such capital reserves may provide additional means to cover client asset losses, the Fund cannot be assured that the Bitcoin Custodian will maintain capital reserves sufficient to cover actual or potential losses with respect to the Fund s digital assets. Furthermore, under the Bitcoin Custody Agreement, the Bitcoin Custodian s liability is limited in various ways, including that the Bitcoin Custodian cannot be held responsible for any failure or delay to act by the Bitcoin Custodian, its service providers, or its banks that is within the time limits permitted by the Bitcoin Custody Agreement, or that is caused by the Fund s negligence or is required to comply with applicable laws and regulations. The Bitcoin Custodian is not liable for any System Failure or Downtime (both as defined in the Bitcoin Custody Agreement), which prevents the Bitcoin Custodian from fulfilling its obligations under the Bitcoin Custody Agreement, provided that Bitcoin Custodian took reasonable care and used commercially reasonable efforts to prevent or limit such System Failures or Downtime and otherwise complied with the Bitcoin Custody Agreement. The Bitcoin Custody Agreement provides that "Downtime" means scheduled maintenance and a "System Failure" shall mean a failure of any computer hardware, software, computer systems, or telecommunications lines or devices used by the Bitcoin Custodian, or interruption, loss, or malfunction of utility, data center, Internet or network provider services used by the Bitcoin Custodian; provided, however, that a cybersecurity attack, data breach, hack, or other intrusion, or unauthorized disclosure by a third party, the Bitcoin Custodian, a service provider to the Bitcoin Custodian, or an agent or subcontractor of the Bitcoin Custodian, shall not be deemed a System Failure, to the extent such events or any losses arising therefrom are due to the Bitcoin Custodian s failure to comply with its obligations under the Bitcoin Custody Agreement. The Bitcoin Custodian cannot be held responsible for any circumstances beyond the Bitcoin Custodian s reasonable control, provided the Bitcoin Custodian took reasonable care and used commercially reasonable efforts in executing its responsibilities to the Fund pursuant to the Bitcoin Custody Agreement, which includes exercising the degree of care, diligence and skill that a prudent and competent professional provider of services similar to the custodial services would exercise in the circumstances, or such higher care where required by law or the Bitcoin Custody Agreement (collectively, the "Standard of Care"). The Bitcoin Custodian makes no guarantees regarding the Bitcoin network s security, functionality, or availability, and will not be liable for or in connection with any acts, decisions, or omissions made by developers of the Bitcoin network. The Bitcoin Custodian is not liable for any losses or claims arising out of actions that are in the Fund s control and related to the Fund s use of the Bitcoin Custodian s online platform, including but not limited to, the Fund s failure to follow security protocols, the Bitcoin Custodian s platform controls, improper instructions, failure to secure the Fund s credentials from third parties, or anything else in the Fund s control and is also not liable for any amount greater than the value of the assets on deposit in Fund s account at the Bitcoin Custodian at the time of, and directly relating to, the events giving rise to the liability occurred, the value of which shall be determined in accordance with the Chicago Mercantile Exchange Bitcoin Reference Rate or any successor thereto. The Bitcoin Custodian is not liable to the Fund (whether under contract, tort (including negligence) or otherwise) for any indirect, incidental, special, punitive or consequential losses suffered or incurred by the Fund (whether or not any such losses were foreseeable). The Bitcoin Custodian is not liable to the Fund or anyone else for any loss or injury resulting directly or indirectly from any damage or interruptions caused by any computer viruses, spyware, scamware, trojan horses, worms, or other malware that may affect the Fund s computer or other equipment, provided such malware did not originate from the Bitcoin Custodian or its agents. The Bitcoin Custody Agreement s "Force Majeure" provision provides that the Bitcoin Custodian is not liable for delays, suspension of operations, failure in performance, or interruption of service to the extent it is directly due to a cause or condition beyond the reasonable control of the Bitcoin Custodian including, but not limited to, any act of God, nuclear or natural disaster, epidemic, action or inaction of civil or military authorities, act of war, terrorism, sabotage, civil disturbance, strike or other labor dispute, accident, or state of emergency; provided, however, that for the avoidance of doubt, the Bitcoin Custody Agreement s Force Majeure provision shall not apply in respect of System Failures or Downtime, which are subject to other respective provisions of the Bitcoin Custody Agreement. The occurrence of an event described in the Force Majeure provision shall not affect the validity and enforceability of any remaining provisions of the Bitcoin Custody Agreement. In the event of potential losses incurred by the Fund as a result of the Bitcoin Custodian losing control of the Fund s bitcoins or failing to properly execute instructions on behalf of the Fund, the Bitcoin Custodian s liability with respect to the Fund will be subject to certain limitations which may allow it to avoid liability for potential losses or may be insufficient to cover the value of such potential losses. Furthermore, the insurance maintained by the Bitcoin Custodian may be insufficient to cover its liabilities to the Fund. Both the Fund and the Bitcoin Custodian are required to indemnify each other under certain circumstances. Subject to the Force Majeure provision and as limited by the limitations of liability in the Bitcoin Custody Agreement, the Bitcoin Custodian shall be liable to the Fund for the Loss (defined below) of any of the Fund s bitcoin or fiat currency to the extent that such Loss was caused by the negligence, fraud, willful or reckless misconduct of the Bitcoin Custodian or breach by the Bitcoin Custodian of its Standard of Care. The Bitcoin Custody Agreement provides that "Loss" means if, at any time the Fund s Bitcoin Account or Fiat Account, as applicable, does not hold the bitcoin or fiat currency that had been (1) received by Bitcoin Custodian in connection with the Fund s Bitcoin Account or Fiat Account pursuant to the Bitcoin Custody Agreement, or (2) duly sent to the Bitcoin Custodian by the Fund or Authorized Participants in connection with the Fund s Bitcoin Account pursuant to the Bitcoin Custody Agreement but not received because of a failure caused by the Bitcoin Custodian. The Bitcoin Custody Agreement provides that "Loss" shall include situations where the Bitcoin Custodian fails to execute a valid withdrawal request, bitcoin are withdrawn from the Fund s Bitcoin Account other than pursuant to a withdrawal request, or the Fund is not able to timely withdraw bitcoin from the Bitcoin Account pursuant to a withdrawal request, in each case due to a failure caused by the Bitcoin Custodian; provided, however, that the Bitcoin Custodian s failure to permit timely withdrawals because it has determined that it cannot do so due to the requirements of applicable laws and regulations or because of the operation of its fraud detection controls shall not be considered a Loss, provided the Bitcoin Custodian is acting reasonably and in good faith. The Bitcoin Custody Agreement provides that should a Loss of the Fund s bitcoin or fiat currency due to the negligence, fraud, willful or reckless misconduct of the Bitcoin Custodian or a breach by the Bitcoin Custodian of its Standard of Care occur, the Bitcoin Custodian will, as soon as practicable, return to the Fund a quantity of the same digital asset that is equal to the quantity of digital assets involved in the Loss, or return to the Fund a quantity of the same fiat currency that is equal to the quantity of fiat currency involved in the Loss (if the Loss involved the Fiat Account). However, the Fund does not control the Bitcoin Custodian and cannot guarantee that the Bitcoin Custodian will perform its obligations to the Fund under the Bitcoin Custody Agreement, in a timely manner or at all. The Bitcoin Custody Agreement provides that (i) the Bitcoin Custodian does not own or control the underlying software protocols of networks which govern the operation of digital assets (including the Bitcoin Blockchain), (ii) the Bitcoin Custodian makes no guarantees regarding their security, functionality, or availability, and (iii) in no event shall the Bitcoin Custodian be liable for or in connection with any acts, decisions, or omissions made by developers or promoters of digital assets, including bitcoin. Similarly, under the Clearing Agreement, the Bitcoin Custodian s liability in connection with the Clearing Services is limited as follows, among others: the Bitcoin Custodian does not have any responsibility for any sale or purchase of bitcoin for cash to a Liquidity Provider through the Clearing Services (such a transaction, a "Clearing Transaction"), other than as specifically identified in the Clearing Agreement. The Bitcoin Custodian may rely upon, without liability on its part, any clearing request submitted through Gemini s platform. Absent gross negligence, willful misconduct or fraud, the Bitcoin Custodian shall not be liable for any loss resulting from a clearing request or the use of Clearing Services. Validation and confirmation procedures used by Gemini are designed only to verify the source of clearing requests and that each party has met its respective obligations in respect of a clearing request and not to detect errors in the content of a clearing request or to prevent duplicate clearing requests. The Fund is responsible for losses resulting from clearing requests provided by it and for any errors made by or on behalf of the Fund, any errors resulting, directly or indirectly, from fraud or the duplication of any clearing request by or on behalf of the Fund, or any losses resulting from the malfunctioning of any devices used by the Fund or loss or compromise of credentials used by the Fund to deliver clearing requests. The Bitcoin Custodian may reject, refuse to settle or otherwise not complete any request to settle a bitcoin transaction through the Clearing Services for any reason necessary to comply with applicable laws and regulations or in connection with its fraud or other compliance controls and systems, and the Bitcoin Custodian shall have no liability whatsoever to the Fund, any transaction counterparty or any other party in connection with or arising out of the Bitcoin Custodian rejecting, refusing or otherwise not completing the settlement of a transaction through the Clearing Services. The Bitcoin Custodian will not settle transactions through the Clearing Services: (i) if either party to a Clearing Transaction has not fully funded its accounts held with the Bitcoin Custodian and used in connection with the Clearing Services (in the Fund s case, the Clearing Account and Fiat Account), as applicable, with the required fiat currency amount or bitcoin amount, as applicable, prior to the agreed expiration time; (ii) if either party to a Clearing Transaction has not confirmed its acceptance of the clearing request to the Bitcoin Custodian prior to the agreed expiration time; (iii) if either party to a transaction is not a Gemini customer; or (iv) for any other reason as determined by the Bitcoin Custodian in its sole discretion to comply with applicable laws and regulation or in connection with the Bitcoin Custodian s fraud or other compliance controls and systems. Although the Bitcoin Custodian has represented to the Sponsor that Clearing Transactions ordinarily settle automatically within minutes once the bitcoin and cash have been funded by both the Fund and the Liquidity Provider in their respective accounts at the Bitcoin Custodian used in connection with the Clearing Services (in the Fund s case, the Clearing Account and Fiat Account), the Bitcoin Custodian is not required by the Clearing Agreement to settle the Clearing Transaction that quickly. These and the other limitations on the Bitcoin Custodian s liability may allow it to avoid liability for potential losses, even if the Bitcoin Custodian directly caused such losses. The Clearing Agreement provides that it is subject to Gemini s User Agreement. Pursuant to Gemini s User Agreement, Gemini agrees to take reasonable care and use commercially reasonable efforts in executing Gemini s responsibilities to the Fund pursuant to the User Agreement, or such higher care where required by law or as specified by the User Agreement. Gemini uses commercially reasonable efforts to provide the Fund with a reliable and secure platform. From time to time, interruptions, errors or other deficiencies in service may occur due to a variety of factors, some of which are outside of our control. These factors can contribute to delays, errors in service, or system outages, creating difficulties in accessing the Fund s account, withdrawing fiat currency or bitcoin, depositing fiat currency or bitcoin, and/or placing and/or canceling orders. Under the User Agreement, Gemini is not liable for any delays, failure in performance or interruption of service which result directly or indirectly from any cause or condition, whether or not foreseeable, beyond Gemini s reasonable control, including, but not limited to, any act of God, nuclear or natural disaster, epidemic, action or inaction of civil or military authorities, act of war, terrorism, sabotage, civil disturbance, strike or other labor dispute, accident, state of emergency or interruption, loss, or malfunction of equipment or utility, communications, computer (hardware or software), Internet or network provider services. Except to the extent required by law, Gemini is not liable under the User Agreement, whether in contract or tort, for any punitive, special, indirect, consequential, incidental, or similar damages, including lost trading or other profits, diminution in asset value, or lost business opportunities (even if Gemini have been advised of the possibility thereof) in connection with the transactions subject to the User Agreement. Gemini s total liability for breach of the User Agreement shall be limited by the value of any of the Fund s allegedly lost fiat currency and digital assets in the custody of Gemini at the time of loss. Under the User Agreement Gemini is not liable for delays or interruptions in service caused by automated or other compliance checks or for other reasonable delays or interruptions in service, by definition to include any delay or interruption shorter than one week, or delays or interruptions in service beyond the control of Gemini or its service providers. The limitation on liability under the User Agreement includes, but is not limited to any damage or interruptions caused by any computer viruses, spyware, scamware, trojan horses, worms, or other malware that may affect the Fund s computer or other equipment, or any phishing, spoofing, domain typosquatting, or other attacks, failure of mechanical or electronic equipment or communication lines, telephone or other interconnect problems (e.g., you cannot access your internet service provider), unauthorized access, theft, operator errors, strikes or other labor problems, or any force majeure. Gemini does not guarantee continuous, uninterrupted, or secure access to Gemini. Gemini is not responsible for any failure or delay to act by any Gemini service provider, including Gemini s banks, or any other participant that is within the time limits permitted by the User Agreement or prescribed by law, or that is caused by the Fund s negligence. Under the User Agreement, Gemini is not responsible for any "System Failure" (defined as a failure of any computer hardware or software used by Gemini, a Gemini service provider, or any telecommunications lines or devices used by Gemini or a Gemini service provider), or scheduled or unscheduled maintenance or downtime, which prevents Gemini from fulfilling its obligations under the User Agreement, provided that Gemini used commercially reasonable efforts to prevent or limit such System Failures, or downtime. Gemini cannot be held responsible for any other circumstances beyond Gemini s reasonable control. Moreover, in the event of an insolvency or bankruptcy of the Bitcoin Custodian in the future, given that the contractual protections and legal rights of customers with respect to digital assets held on their behalf by third parties are relatively untested in a bankruptcy of an entity such as the Bitcoin Custodian in the virtual currency industry, there is a risk that customers assets – including the Fund s assets – may be considered the property of the bankruptcy estate of the Bitcoin Custodian, and customers – including the Fund – may be at risk of being treated as general unsecured creditors of such entities and subject to the risk of total loss or markdowns on value of such assets. The Bitcoin Custody Agreement contains an agreement by the parties to treat the bitcoin credited to the Fund s Vault Balance as financial assets under Article 8 of the New York Uniform Commercial Code ("Article 8"), in addition to stating that the Bitcoin Custodian will serve as fiduciary and custodian on the Fund s behalf. It is possible that a court would not treat custodied digital assets as part of the Bitcoin Custodian s general estate in the event the Bitcoin Custodian were to experience insolvency. However, due to the novelty of digital asset custodial arrangements courts have not yet considered this type of treatment for custodied digital assets and it is not possible to predict with certainty how they would rule in such a scenario. In the case of the Clearing Account, because it is an omnibus account in which the assets of multiple customers – including the Fund s assets – are held together, it is likely the Fund would be treated as a general unsecured creditor in respect of the Clearing Account held with the Bitcoin Custodian in the event of the Bitcoin Custodian s insolvency. The Clearing Agreement does not contain an Article 8 opt-in. If the Bitcoin Custodian became subject to insolvency proceedings and a court were to rule that the custodied bitcoin were part of the Bitcoin Custodian s general estate and not the property of the Fund, then the Fund would be treated as a general unsecured creditor in the Bitcoin Custodian s insolvency proceedings and the Fund could be subject to the loss of all or a significant portion of its assets. Moreover, in the event of the bankruptcy of the Bitcoin Custodian, an automatic stay could go into effect and protracted litigation could be required in order to recover the assets held with the Bitcoin Custodian, all of which could significantly and negatively impact the Fund s operations and the value of the Shares. Under the Fund Agreement, the Trustee and the Sponsor will not be liable for any liability or expense incurred, including, without limitation, as a result of any loss of bitcoin by the Bitcoin Custodian, absent gross negligence or bad faith on the part of the Trustee or the Sponsor or breach by the Sponsor of the Fund Agreement, as the case may be. As a result, the recourse of the Fund or the Shareholders to the Trustee or the Sponsor, including in the event of a loss of bitcoin by the Bitcoin Custodian, is limited. The Shareholders recourse against the Sponsor, the Trustee, and the Fund s other service providers for the services they provide to the Fund, including, without limitation, those relating to the holding of bitcoin or the provision of instructions relating to the movement of bitcoin, is limited. For the avoidance of doubt, neither the Sponsor, the Trustee, nor any of their affiliates, nor any other party has guaranteed the assets or liabilities, or otherwise assumed the liabilities, of the Fund, or the obligations or liabilities of any service provider to the Fund, including, without limitation, the Bitcoin Custodian. Consequently, a loss may be suffered with respect to the Fund s bitcoin that is not covered by the Bitcoin Custodian s insurance and for which no person is liable in damages. As a result, the recourse of the Fund or the Shareholders, under applicable law, is limited. Risks Related to the Regulation of Bitcoin Digital asset markets in the U.S. exist in a state of regulatory uncertainty, and adverse legislative or regulatory developments could significantly harm the value of bitcoin or the Shares, such as by banning, restricting or imposing onerous conditions or prohibitions on the use of bitcoin, mining activity, digital wallets, the provision of services related to trading and custodying bitcoin, the operation of the Bitcoin Network, or the digital asset markets generally. There is a lack of consensus regarding the regulation of digital assets, including bitcoin, and their markets. As a result of the growth in the size of the digital asset market, as well as the 2022 Events, the U.S. Congress and a number of U.S. federal and state agencies (including FinCEN, SEC, OCC, CFTC, FINRA, the Consumer Financial Protection Bureau ("CFPB"), the Department of Justice, the Department of Homeland Security, the Federal Bureau of Investigation, the IRS, state financial institution regulators, and others) have been examining the operations of digital asset networks, digital asset users and the digital asset markets. Many of these state and federal agencies have brought enforcement actions or issued consumer advisories regarding the risks posed by digital assets to investors. Ongoing and future regulatory actions with respect to digital assets generally or bitcoin in particular may alter, perhaps to a materially adverse extent, the nature of an investment in the Shares, the portion of the Shares value that is tied to bitcoin, or the ability of the Fund to continue to operate. The 2022 Events, including among others the bankruptcy filings of FTX and its subsidiaries, Three Arrows Capital, Celsius Network, Voyager Digital, Genesis, BlockFi and others, and other more recent developments in the digital asset markets, have resulted in calls for heightened scrutiny and regulation of the digital asset industry, with a specific focus on intermediaries such as digital asset exchanges, platforms and custodians. Federal and state legislatures and regulatory agencies may introduce and enact new laws and regulations to regulate crypto asset intermediaries, such as digital asset exchanges and custodians. The March 2023 collapses of Silicon Valley Bank, Silvergate Bank, and Signature Bank, which in some cases provided services to the digital assets industry, may amplify and/or accelerate these trends. On January 3, 2023, the federal banking agencies issued a joint statement on crypto-asset risks to banking organizations following events which exposed vulnerabilities in the crypto-asset sector, including the risk of fraud and scams, legal uncertainties, significant volatility, and contagion risk. Although banking organizations are not prohibited from crypto-asset related activities, the agencies have expressed significant safety and soundness concerns with business models that are concentrated in crypto-asset related activities or have concentrated exposures to the crypto-asset sector. US federal and state regulators, as well as the White House, have issued reports and releases concerning crypto assets, including Bitcoin and crypto asset markets. Further, in 2023 the House of Representatives formed two new subcommittees: the Digital Assets, Financial Technology and Inclusion Subcommittee and the Commodity Markets, Digital Assets, and Rural Development Subcommittee, each of which were formed in part to analyze issues concerning crypto assets and demonstrate a legislative intent to develop and consider the adoption of federal legislation designed to address the perceived need for regulation of and concerns surrounding the crypto industry. However, the extent and content of any forthcoming laws and regulations are not yet ascertainable with certainty, and it may not be ascertainable in the near future. A divided Congress makes any prediction difficult. The Fund cannot predict how these and other related events will affect it or the crypto asset business. In August 2021, the chair of the SEC stated that he believed investors using digital asset trading platforms are not adequately protected, and that activities on the platforms can implicate the securities laws, commodities laws and banking laws, raising a number of issues related to protecting investors and consumers, guarding against illicit activity, and ensuring financial stability. The chair expressed a need for the SEC to have additional authorities to prevent transactions, products, and platforms from "falling between regulatory cracks," as well as for more resources to protect investors in "this growing and volatile sector." The chair called for federal legislation centering on digital asset trading, lending, and decentralized finance platforms, seeking "additional plenary authority" to write rules for digital asset trading and lending. It is not possible to predict whether Congress will grant additional authorities to the SEC or other regulators, what the nature of such additional authorities might be, how they might impact the ability of digital asset markets to function or how any new regulations that may flow from such authorities might impact the value of digital assets generally and bitcoin held by the Fund specifically. The consequences of increased federal regulation of digital assets and digital asset activities could have a material adverse effect on the Fund and the Shares. In June 2023, the SEC filed lawsuits against Coinbase and Binance, two large U.S. digital asset trading platforms, alleging that Coinbase and Binance had been operating as unregistered securities exchanges, brokers and clearing agencies in violation of U.S. federal securities laws. While the SEC has not alleged that bitcoin is a security, the outcome of these enforcement actions and others may result in the substantial restructuring of the digital asset market in the United States. However, the SEC has recently faced setbacks in U.S. courts in its attempt to regulate the digital asset markets. In July 2023, the U.S. District Court for the Southern District of New York ruled on the SEC s action against Ripple Labs, Inc. The court found that offers and sales of XRP, a digital token, to institutions and sophisticated individuals constituted securities transactions, but that offers and sales of XRP on crypto exchanges, distributions to employees, and other third-party developers were not securities transactions. More recently, the D.C. Circuit Court found that the SEC s denial of the Grayscale Bitcoin Trust s listing was "arbitrary and capricious" under the Administrative Procedures Act in light of the SEC s approval of two similar bitcoin futures-based ETPs. Nonetheless, until the SEC s numerous actions against digital asset market participants are resolved, the structure of the digital asset market in the United States will remain subject to substantial regulatory risk, which may impact the demand for digital assets and the continued availability of existing exchanges and offerings. FinCEN requires any administrator or exchanger of convertible digital assets to register with FinCEN as a money transmitter and comply with the anti-money laundering ("AML") regulations applicable to money transmitters. Entities which fail to comply with such regulations are subject to fines, may be required to cease operations, and could have potential criminal liability. For example, in 2015, FinCEN assessed a $700,000 fine against a sponsor of a digital asset for violating several requirements of the Bank Secrecy Act by acting as a money services business, or "MSB," and selling the digital asset without registering with FinCEN, and by failing to implement and maintain an adequate AML program. In 2017, FinCEN assessed a $110 million fine against BTC-e, a now defunct digital asset exchange, for similar violations. The requirement that exchangers that do business in the U.S. register with FinCEN and comply with AML regulations may increase the cost of buying and selling bitcoin and therefore may adversely affect the price of bitcoin and an investment in the Shares. The Office of Foreign Assets Control ("OFAC") of the U.S. Department of the Treasury (the "U.S. Treasury Department") has added digital currency addresses to the list of Specially Designated Nationals whose assets are blocked, and with whom U.S. persons are generally prohibited from dealing. Such actions by OFAC, or by similar organizations in other jurisdictions, may introduce uncertainty in the market as to whether bitcoin that has been associated with such addresses in the past can be easily sold. This "tainted" bitcoin may trade at a substantial discount to untainted bitcoin. Reduced fungibility in the digital asset markets may reduce the liquidity of bitcoin and therefore adversely affect their price. In February 2020, then-U.S. Treasury Secretary Steven Mnuchin stated that digital assets were a "crucial area" on which the U.S. Treasury Department has spent significant time. Secretary Mnuchin announced that the U.S. Treasury Department is preparing significant new regulations governing digital asset activities to address concerns regarding the potential use for facilitating money laundering and other illicit activities. In December 2020, FinCEN, a bureau within the U.S. Treasury Department, proposed a rule that would require financial institutions to submit reports, keep records, and verify the identity of customers for certain transactions to or from so-called "unhosted" wallets, also commonly referred to as self-hosted wallets. In January 2021, U.S. Treasury Secretary nominee Janet Yellen stated her belief that regulators should "look closely at how to encourage the use of digital assets for legitimate activities while curtailing their use for malign and illegal activities." Under regulations from the New York State Department of Financial Services ("NYDFS"), businesses involved in digital asset business activity for third parties in or involving New York, excluding merchants and consumers, must apply for a license, commonly known as a BitLicense, from the NYDFS and must comply with AML, cyber security, consumer protection, and financial and reporting requirements, among others. As an alternative to a BitLicense, a firm can apply for a charter to become a limited purpose trust company under New York law qualified to engage in certain digital asset business activities. Other states have considered or approved digital asset business activity statutes or rules, passing, for example, regulations or guidance indicating that certain digital asset business activities constitute money transmission requiring licensure. The inconsistency in applying money transmitting licensure requirements to certain businesses may make it more difficult for these businesses to provide services, which may affect consumer adoption of bitcoin and its price. In an attempt to address these issues, the Uniform Law Commission passed a model law in July 2017, the Uniform Regulation of Virtual Currency Businesses Act, which has many similarities to the BitLicense and features a multistate reciprocity licensure feature, wherein a business licensed in one state could apply for accelerated licensure procedures in other states. It is still unclear, however, how many states, if any, will adopt some or all of the model legislation. Law enforcement agencies have often relied on the transparency of blockchains to facilitate investigations. However, certain privacy-enhancing features have been, or are expected to be, introduced to a number of digital asset networks. If the Bitcoin Network were to adopt any of these features, these features may provide law enforcement agencies with less visibility into transaction-level data. Europol, the European Union s law enforcement agency, released a report in October 2017 noting the increased use of privacy-enhancing digital assets like Zcash and Monero in criminal activity on the internet. Although no regulatory action has been taken to treat privacy-enhancing digital assets differently, this may change in the future. A determination that bitcoin or any other digital asset is a "security" may adversely affect the value of bitcoin and the portion of the Shares value that is tied to bitcoin, and result in potentially extraordinary, nonrecurring expenses to, or termination of, the Fund. Depending on its characteristics, a digital asset may be considered a "security" under the federal securities laws. The test for determining whether a particular digital asset is a "security" is complex and difficult to apply, and the outcome is difficult to predict. Public, though non-binding, statements by senior officials at the SEC indicate that the SEC does not consider bitcoin to be a security, at least currently, and the staff has provided informal assurances to a handful of promoters that their digital assets are not securities. On the other hand, the SEC has brought enforcement actions against the promoters of several other digital assets on the basis that the digital assets in question are securities. Whether a digital asset is a security under the federal securities laws depends on whether it is included in the lists of instruments making up the definition of "security" in the Securities Act, the Exchange Act and the Investment Company Act. Digital assets as such do not appear in any of these lists, although each list includes the terms "investment contract" and "note," and the SEC has typically analyzed whether a particular digital asset is a security by reference to whether it meets the tests developed by the federal courts interpreting these terms, known as the Howey and Reves tests, respectively. For many digital assets, whether or not the Howey or Reves tests are met is difficult to resolve definitively, and substantial legal arguments can often be made both in favor of and against a particular digital asset qualifying as a security under one or both of the Howey and Reves tests. Adding to the complexity, the SEC staff has indicated that the security status of a particular digital asset can change over time as the relevant facts evolve. As part of determining whether bitcoin is a security for purposes of the federal securities laws, the Sponsor takes into account a number of factors, including the various definitions of "security" under the federal securities laws and federal court decisions interpreting elements of these definitions, such as the U.S. Supreme Court s decisions in the Howey and Reves cases, as well as reports, orders, press releases, public statements and speeches by the SEC and its staff providing guidance on when a digital asset may be a security for purposes of the federal securities laws. Finally, the Sponsor discusses the security status of bitcoin with its external securities lawyers. Through this process the Sponsor believes that it is applying the proper legal standards in determining that bitcoin is not a security in light of the uncertainties inherent in the Howey and Reves tests. However, because of these uncertainties, the Sponsor acknowledges that bitcoin may in the future be found by the SEC or a federal court to be a security notwithstanding the Sponsor s prior conclusion; and the Sponsor s prior conclusion, even if reasonable under the circumstances, would not preclude legal or regulatory action based on the presence of a security. The Sponsor may dissolve the Fund if the Sponsor determines bitcoin is a security under the federal securities laws, whether that determination is initially made by the Sponsor itself, or because the SEC or a federal court subsequently makes that determination. Because the legal tests for determining whether a digital asset is or is not a security often leave room for interpretation, for so long as the Sponsor believes there to be good faith grounds to conclude that the Fund s bitcoin is not a security, the Sponsor does not intend to dissolve the Fund on the basis that bitcoin could at some future point be determined to be a security. Any enforcement action by the SEC or a state securities regulator asserting that bitcoin is a security, or a court decision, to that effect would be expected to have an immediate material adverse impact on the trading value of Bitcoin, as well as the Shares. This is because the business models behind most digital assets are incompatible with regulations applying to transactions in securities. If a digital asset is determined or asserted to be a security, it is likely to become difficult or impossible for the digital asset to be traded, cleared or custodied in the United States through the same channels used by non-security digital assets, which in addition to materially and adversely affecting the trading value of the digital asset is likely to significantly impact its liquidity and market participants ability to convert the digital asset into U.S. dollars. For example, in 2020 the SEC filed a complaint against the promoters of XRP alleging that they raised more than $1.3 billion through XRP sales that should have been registered under the federal securities laws, but were not. In the years prior to the SEC s action, XRP s market capitalization at times reached over $100 billion. However, in the weeks following the SEC s complaint, XRP s market capitalization fell to less than $10 billion, which was less than half of its market capitalization in the days prior to the complaint. In July 2023, the U.S. District Court for the Southern District of New York ruled on the SEC s action against Ripple Labs, Inc. The court found that offers and sales of XRP to institutions and sophisticated individuals constituted securities transactions, but that offers and sales of XRP on crypto exchanges, distributions to employees, and other third-party developers were not securities transactions. The SEC s action against XRP s promoters underscores the continuing uncertainty around which digital assets are securities, and demonstrates that such factors as how long a digital asset has been in existence, how widely held it is, how large its market capitalization is and that it has actual usefulness in commercial transactions, ultimately may have no bearing on whether the SEC or a court will find it to be a security. In addition, if bitcoin is determined to be a security, the Fund could be considered an unregistered "investment company" under SEC rules, which could necessitate the Fund s liquidation. In this case, the Fund and the Sponsor may be deemed to have participated in an illegal offering of securities and there is no guarantee that the Sponsor will be able to register the Fund under the Investment Company Act at such time or take such other actions as may be necessary to ensure the Fund s activities comply with applicable law, which could force the Sponsor to liquidate the Fund. Moreover, whether or not the Sponsor or the Fund were subject to additional regulatory requirements as a result of any SEC or federal court determination that its assets include securities, the Sponsor may nevertheless decide to terminate the Fund, in order, if possible, to liquidate the Fund s assets while a liquid market still exists. As a result, if the SEC or a federal court were to determine that bitcoin is a security, it is likely that the portion of the Shares value that is tied to bitcoin would decline significantly, and that the Fund itself would be terminated and, if practical, its assets liquidated. Future and current regulations by a U.S. or foreign government or quasi-governmental agency could have an adverse effect on an investment in the Fund. The regulation of bitcoin and related products and services continues to evolve, may take many different forms and will, therefore, impact the Bitcoin Network and bitcoin and their usage in a variety of manners. The inconsistent and sometimes conflicting regulatory landscape may make it more difficult for bitcoin businesses to provide services, which may impede the growth of the bitcoin economy and have an adverse effect on consumer adoption of bitcoin. There is a possibility of future regulatory change altering, perhaps to a material extent, the nature of an investment in the Shares or the ability of the Fund to continue to operate. Changes to current regulatory determinations of bitcoin s status under federal or state securities laws, changes to regulations surrounding bitcoin futures or related products, or actions by a U.S. or foreign government or quasi-governmental agency exerting regulatory authority over bitcoin, the Bitcoin Network, bitcoin trading, or related activities impacting other parts of the digital asset market, may adversely impact bitcoin and therefore may have an adverse effect on the value of an investment in the Fund. If the Bitcoin Network is used to facilitate illicit activities or evade sanctions, businesses that facilitate transactions in bitcoin could be at increased risk of criminal or civil lawsuits, or of having services cut off, which could negatively affect the price of bitcoin and the value of the Shares. Digital asset networks have in the past been, and may continue to be, used to facilitate illicit activities. If the Bitcoin Network is used to facilitate illicit activities or evade sanctions, businesses that facilitate transactions in bitcoin could be at increased risk of potential criminal or civil lawsuits, or of having banking or other services cut off, and bitcoin could be removed from digital asset trading platforms as a result of these concerns. Other service providers of such businesses may also cut off services if there is a concern that the Bitcoin Network is being used to facilitate crime. Any of the aforementioned occurrences could increase regulatory scrutiny of the Bitcoin Network and/or adversely affect the price of bitcoin, the attractiveness of the Bitcoin Network and an investment in the Shares of the Trust. The Fund and the Sponsor, acting on behalf of the Fund, directly interact with parties that are themselves subject to AML program requirements under the Bank Secrecy Act or similar laws. The Authorized Purchasers are registered broker-dealers or financial institutions exempt from broker-dealer registration and therefore are subject to AML and countering the financing of terrorism obligations under the Bank Secrecy Act as administered by FinCEN and further overseen by the SEC and FINRA. In accordance with its regulatory obligations, the Authorized Purchasers conduct customer due diligence. When the Fund and the Sponsor, acting on behalf of the Fund, buy, sell or deliver, as applicable, bitcoin, they transact directly with financial institution counterparties that are subject to U.S. federal and/or state licensing requirements or similar laws in non-U.S. jurisdictions and maintain practices and policies designed to comply with AML and KYC regulations or similar laws in non-U.S. jurisdictions. The Fund will not hold any bitcoin except those that have been delivered by the Fund s Bitcoin Trading Counterparties in connection with creation requests. If the Sponsor, the Fund, or an Authorized Purchaser were nevertheless to transact with such a sanctioned entity, the Sponsor, the Fund, and such Authorized Purchaser would be at increased risk of potential criminal or civil lawsuits. Risks Related to Carbon Credit Futures and the Fund s Status as a Commodity Pool The Fund is subjected to exposure to risks of futures contracts. The primary risks associated with the use of futures contracts include: (a) an imperfect correlation between the change in market value of the reference asset and the price of the futures contract; (b) possible lack of a liquid secondary market for a futures contract and the resulting inability to close a futures contract when desired; (c) losses caused by unanticipated market movements, which are potentially unlimited; (d) the inability to predict correctly the direction of market prices, interest rates, currency exchange rates and other economic factors; and (e) risks associated with the underlying asset. Market fraud and/or manipulation and other fraudulent trading practices such as the intentional dissemination of false or misleading information (e.g., false rumors) can, among other things, lead to a disruption of the orderly functioning of markets, significant market volatility, and cause the value of Carbon Credit Futures to fluctuate quickly and without warning. Depending on the timing of an investor s purchases and sales of the Fund s Shares, these pricing anomalies could cause the investor to incur losses. As a futures contract the Fund owns approaches its settlement date, the Fund may sell that futures contract and reinvest the proceeds in a similar contract with a more distant settlement date. This process is referred to as "rolling" a futures contract. The successful use of such a strategy depends upon the Sponsor s skill and experience. Although the Fund will attempt to roll from an expiring futures contract to another contract to mirror that of the Index, the Fund nevertheless may incur a cost to "roll" the contract. In a commodity futures market where current month expiring contracts trade at a lower price than next month s contract, a situation referred to as "contango," absent the impact of the overall movement in commodity prices, the Fund may experience an adverse impact because it would be selling less expensive contracts and buying more expense contracts. In the event of a prolonged period of contango, and absent the impact of rising or falling commodity prices, there could be a significant negative impact on the Fund when it "rolls" its futures contract positions. Futures contracts are subject to inherent leverage risk because they are typically secured by margin deposits representing a small percentage of a futures contract s entire market value. Commodity pools trading positions in futures contracts are typically required to be secured by the deposit of margin funds that represent only a small percentage of a futures contract s entire market value. This feature creates the potential for commodity pools to "leverage" their assets by purchasing or selling futures contracts with an aggregate notional amount in excess of the commodity pool s assets. The Fund is subject to the risks associated with Commodity-Linked Derivatives. The value of a commodity-linked derivative investment typically is based upon the price movements of a physical commodity and may be affected by changes in overall market movements, volatility of an index, changes in interest rates, or factors affecting a particular industry or commodity, such as drought, floods, weather, embargoes, tariffs and international economic, political and regulatory developments. Investments in commodity-linked derivatives may be subject to greater volatility than non-derivative based investments. Commodity-linked derivatives also may be subject to credit and interest rate risks that in general affect the values of debt securities. The Fund s usage of commodities derivatives investments involves additional, and potentially greater, risks of investing in the underlying asset directly. The use of derivatives (including futures and forwards) involves risks different from, or possibly greater than, the risks of investing directly in the underlying commodity. These risks include, but are not limited to, leverage risk, liquidity risk, valuation risk, market risk, counterparty risk, and credit risk. Derivatives may at times be highly illiquid, and the Fund may not be able to close out or sell a derivative at a particular time or at an anticipated price. Derivatives can be difficult to value and valuation may be more difficult in times of market turmoil. There may be imperfect correlation between the derivative and that of the reference asset, resulting in unexpected returns that could materially adversely affect the Fund. Derivatives are also subject to additional risks such as operational risk, including settlement issues, and legal risk, including that underlying documentation is incomplete or ambiguous. Certain derivatives (such as swaps and options) are bi-lateral agreements that expose the Fund to counterparty risk. A counterparty (the other party to a transaction or an agreement or the party with which the Fund executes transactions) to a transaction with the Fund may be unable or unwilling to make timely principal, interest or settlement payments, or otherwise honor its obligations. If the counterparty or its affiliate becomes insolvent, bankrupt or defaults on its payment obligations to the Fund, the value of an investment held by the Fund may decline. Additionally, if any collateral posted by the counterparty for the benefit of the Fund is insufficient or there are delays in the Fund s ability to access such collateral, the Fund may not be able to achieve its investment objective. In addition, the Fund may enter into transactions with a limited number of counterparties, which may increase the Fund s exposure to counterparty credit risk. Further, there is a risk that no suitable counterparties will be willing to enter into, or continue to enter into, transactions with the Fund and, as a result, the Fund may not be able to achieve its inverse investment objective or may decide to change its inverse investment objective. Position limits and margin requirements, among other limitations, may have the potential to cause tracking error, which could cause the price of Shares to substantially vary from the Index. If the Fund s ability to obtain exposure to Carbon Credit Futures to mirror the exposure of the Index is disrupted for any reason, including but not limited to, limited liquidity in the Carbon Credit Futures markets, a disruption to the Carbon Credit Futures market, or as a result of margin requirements or position limits imposed by the Fund s FCMs, the exchanges on which the Carbon Credit Futures trade, or the CFTC, the Fund would not be able to achieve its investment objective and may experience significant losses. Position limits, accountability limits and dynamic price fluctuation limits may limit the Fund s ability to invest the proceeds of Baskets in Carbon Credit Futures. As a result, when the Fund sells Baskets it may be limited in its ability to invest in Carbon Credit Futures. In such a case, the Fund may hold larger amounts of cash and cash equivalents, which will impair the Fund s ability to meet its investment objective of tracking the Index. Price fluctuation limits may contribute to a lack of liquidity and have a negative impact on Fund performance. During periods of market illiquidity, including periods of market disruption and volatility, it may be difficult or impossible for the Fund to buy or sell futures at desired prices or at all. The Fund is subject to the regulatory risks associated with being a commodity pool. Under regulations promulgated by the CFTC, the Fund is considered a commodity pool, and therefore is subject to regulation under the CEA and CFTC rules. The Sponsor is registered as a CPO and CTA and manages the investments of the Fund in accordance with its investment objective and strategies, as well as in accordance with CFTC rules. Commodity pools are subject to additional laws, regulations and enforcement policies, all of which may potentially increase compliance costs and may affect the operations and financial performance of the Fund. Additionally, positions in commodity-linked derivative instruments may have to be liquidated at disadvantageous times or prices to prevent the Fund from exceeding any applicable position limits established by the CFTC. Such actions may subject the Fund to substantial losses. Registration of the Sponsor as a CPO imposes additional compliance obligations on the Sponsor and the Fund related to additional laws, regulations and enforcement policies, which could increase compliance costs and may affect the operations and financial performance of the Fund. The Fund s investment exposure to carbon credit futures contracts will cause it to be deemed to be a commodity pool, thereby subjecting the Fund to regulation under the CEA and CFTC regulations. The Sponsor is registered as a CPO and the Fund will be operated in accordance with applicable CFTC regulations. Registration as a CPO imposes additional compliance obligations on the Sponsor and the Fund related to additional laws, regulations and enforcement policies, which could increase compliance costs and may affect the operations and financial performance of the Fund. For example, the Sponsor will be required to post certain documents on the Fund s website, make periodic filings with the NFA, retain certain records, and implement certain policies and procedures. The Fund is subject to risks associated with carbon emissions allowances and cap-and-trade regimes due to its investment in Carbon Credit Futures. There is no assurance that cap-and-trade regimes will continue to exist. Cap-and-trade regimes were designed to attempt to put a cap on pollution by putting a price on carbon emissions, but the approach may not prove to be an effective method of reducing GHG emissions and or in achieving climate change objectives. As a result or due to other factors, cap-and-trade regimes may be terminated or may not be renewed upon their expiration. New technologies may arise that may diminish or eliminate the need for cap-and-trade markets. Ultimately, the cost of emissions credits is determined by the cost of actually reducing emissions levels. If the price of credits becomes too high, it will be more economical for companies to develop or invest in green technologies, thereby suppressing the demand for credits and adversely affecting the Fund. Cap-and-trade regimes set emission limits (i.e., the right to emit a certain quantity of GHG emissions), which can be allocated or auctioned to the parties regulated under the regime up to the total emissions cap. This allocation may be larger or smaller than is needed for a stable price of credits and can lead to large price volatility and may impact the Fund. Depending upon the industries covered under the cap-and-trade regime, unpredictable demand for their products and services can affect the value of GHG emissions credits. For example, very mild winters or very cool summers can decrease demand for electric utilities and therefore require fewer carbon credits to offset reduced production and GHG emissions. If fines or other penalties for non-compliance are not enforced, incentives to purchase GHG credits will deteriorate, which could result in a decline in the price of emissions credits and may adversely impact the Fund. Climate change regulations may change, which could cause loss in value of the carbon underlying the Carbon Credit Futures and the Carbon Credit Futures itself. The Fund is subject to the risk that a change in law and related regulations will impact the way the Fund operates, increase the particular costs of the Fund s operations and/or change the competitive landscape. Additional legislative or regulatory changes could occur that may materially and adversely affect the Fund. Governments around the world are increasingly focused on enacting laws and regulations regarding climate change and regulation of GHGs. Lawmakers and regulators in the jurisdictions in the United States and Europe have proposed or enacted regulations requiring reporting of greenhouse gas emissions and the restriction thereof. In addition, efforts have been made and continue to be made in the international community toward the adoption of international treaties or protocols that would address global climate change issues and impose reductions of hydrocarbon-based fuels, and encouraging the implementation of net-zero GHG emission pledges. In recent years, the U.S. Congress has considered legislation to reduce emissions of GHGs and has included climate change considerations in its funding bills. For example, the Inflation Reduction Act of 2022, which appropriates significant federal funding for renewable energy initiatives, was signed into law in August 2022 and could accelerate the transition away from fossil fuels. In November 2021, the Biden Administration released "The Long-Term Strategy of the United States: Pathways to Net-Zero Greenhouse Gas Emissions by 2050," which establishes a roadmap to net zero emissions in the United States by 2050 through, among other things, improving energy efficiency, decarbonizing energy sources via electricity, hydrogen and sustainable biofuels, eliminating subsidies provided to the fossil fuel industry, reducing non-CO2 GHG emissions and increasing the emphasis on climate-related risks across government agencies and economic sectors. At the international level, the United States re-entered the United Nations-sponsored "Paris Agreement," a non-binding agreement for nations to limit their greenhouse gas emissions through individually determined reduction goals every five years after 2020, shortly after President Biden took office in February 2021. Then, in April 2021, President Biden announced a new, more rigorous nationally determined emissions reduction level of 50%-52% reduction from 2005 levels in economy-wide net GHG emissions by 2030. The international community has since gathered again in November 2021, November 2022, and December 2023 for the annual United Nations Climate Change Conference of the Parties, where the U.S., the European Union, and other partners announced reaffirmed their emissions reduction commitments and made further climate change goals. Most recently, the parties agreed to transition "away from fossil fuels in energy systems in a just, orderly and equitable manner" and increase renewable energy capacity so as to achieve net zero by 2050, although no timeline for doing so was set. The impacts of these orders, pledges, agreements and any legislation or regulation promulgated to fulfill the U.S. s commitments under the Paris Agreement or other international conventions cannot be predicted at this time. The proposed rules and initiatives addressing climate change described above are subject to intense political debate and their adoption or implementation will likely be impacted by the change in presidential administration resulting from the 2024 United States presidential election. Regulatory risk related to changes in regulation and enforcement of cap-and-trade regimes could adversely affect market behavior. In addition, as cap-and-trade markets and carbon credit markets develop, new regulation with respect to these markets may arise, which could have a negative effect on the value and liquidity of the cap-and-trade markets and the Fund. For example, regulatory changes to the CCM or VCM regimes to which the Carbon Credit Futures are tied, including changes to target emission levels, the emission sources and greenhouse gases covered by the regime, the allowance allocation system, the ability to "bank" allowances for or "borrow" allowances from a future year, and the types of offsets permitted to lower the overall costs of meeting the emission cap, among others, could impact the cost of reducing emissions levels and, as a result, the cost of emissions credits and may adversely impact the Fund. There is no assurance that CCM regimes will continue to exist. There is no assurance that CCM regimes will continue to exist. Cap-and-trade regimes were designed to attempt to put a cap on pollution by putting a price on carbon emissions, but the approach may not prove to be an effective method of reduction in GHG emissions and or in achieving climate change objectives. As a result or due to other factors, cap-and-trade regimes may be terminated or may not be renewed upon their expiration. New technologies may arise that may diminish or eliminate the need for CCMs. Ultimately, the cost of emissions credits is determined by the cost of actually reducing emissions levels. If the price of credits becomes too high, it will be more economical for companies to develop or invest in green technologies, thereby suppressing the demand for credits and adversely affect the Fund. Cap-and-trade regimes set emission limits (i.e., the right to emit a certain quantity of GHG emissions), which can be allocated or auctioned to the parties regulated under the regime up to the total emissions cap. This allocation may be larger or smaller than is needed for a stable price of credits and can lead to large price volatility and may impact the Fund. Depending upon the industries covered under the CCM regime, unpredictable demand for their products and services can affect the value of GHG emissions credits. For example, very mild winters or very cool summers can decrease demand for electric utilities and therefore require fewer carbon credits to offset reduced production and GHG emissions. If fines or other penalties for non-compliance are not enforced, incentives to purchase GHG credits will deteriorate, which could result in a decline in the price of emissions credits and may adversely impact the Fund. The Fund is also exposed to the risks of the underlying commodity, the carbon credits, linked to the Carbon Credit Futures. The value of a commodity-linked derivative investment typically is based upon the price movements of a physical commodity and may be affected by changes in overall market movements, volatility of an index, changes in interest rates, or factors affecting a particular industry or commodity, such as drought, floods, weather, embargoes, tariffs and international economic, political and regulatory developments. Investments in commodity-linked derivatives may be subject to greater volatility than non-derivative based investments. Commodity-linked derivatives also may be subject to credit and interest rate risks that in general affect the values of debt securities. The Fund is exposed to multiple geographic risks due to obtaining exposure to carbon markets in multiple geographic regions through its exposure to the Carbon Credit Futures that comprise the Index. The Fund s investments are expected to be in various countries or regions and, therefore the Fund may be susceptible to adverse market, political, regulatory, and geographic events affecting that country, countries or region. Such geographic focus also may subject the Fund to a higher degree of volatility than a more geographically diversified fund. European Union Risk. Because the Fund is exposed to carbon credits issued under the EU ETS cap-and-trade program, the Fund s performance may be negatively impacted by factors affecting the European Union. The economies of the European Union are dependent to a significant extent on those of certain key trading partners, including China, the United States, and other European countries. A reduction in spending on products and services exported from the European Union, or volatility in the financial markets of member countries, may have an adverse impact on the broader European Union economy and could adversely affect the Fund. Separately, the European Union faces issues involving its membership, structure, procedures and policies. The United Kingdom (UK) officially withdrew from the European Union on January 31, 2020. The UK, European Union and broader global economy may still experience volatility in foreign exchange markets as a result of these events. The UK s withdrawal may also destabilize some or all of the other European Union member countries and/or the Eurozone. The exit of additional member states from the European Union would subject its currency and banking system to increased risk and would likely result in increased volatility, illiquidity and potentially lower economic growth in the affected markets. Additionally, the reintroduction of national currencies in one or more European Union countries or the abandonment of the Euro as a currency could adversely affect the Fund. California Risk. Because the Fund is exposed to carbon credits issued under the CCA cap-and-trade program, the Fund s performance also may be negatively impacted by factors affecting California. For example, natural disasters may disrupt the local, state or regional economy or certain sectors of the economy and may impact the prices of such carbon credit futures. California s budget and fiscal operations face certain structural impediments and rely on revenue sources which have been historically sensitive to the economic environment. California s diverse economy is the largest in the United States and one of the largest in the world with major components including high technology, trade, entertainment, manufacturing, tourism, construction, agriculture and services. Any downturn in these sectors or related industries may adversely affect the economy of the state and the prices of such Carbon Credit Futures. Eastern U.S. Risk. Because the Fund is exposed to carbon credits issued under the RGGI cap-and-trade program, the Fund s performance also may be negatively impacted by factors affecting the Eastern region of the United States. For example, flooding, warming temperatures, and precipitation variability are growing challenges in the Eastern region of the United States and may disrupt the local, state, or regional economies of the Eastern states or certain sectors of those economies and may impact the prices of such carbon credit futures. The economies of the Eastern region of the United States are comprised of components including agriculture, tourism, professional services, and manufacturing. Any downturn in these sectors or related industries may adversely affect the economy of the Eastern region of the United States and the prices of such Carbon Credit Futures. The Fund may experience risks related to the energy, agriculture and metal sectors associated with its trading in carbon credit futures contracts. The market values of the companies in the energy, agriculture and metal sectors and industries are highly dependent on supply and demand resources, economic conditions, and technological advances among other factors. As a result, these sectors and industries can be volatile segments of the market. Companies in these sectors are also frequently subject to substantial regulation and may be subject to competitive or fixed pricing structures, which may increase the cost of business and limit potential earnings. Companies in these sectors also may have significant exposure to emerging markets or developing countries and, thus, be subject to a greater risk of expropriation, nationalization or other adverse governmental policies. The Fund may have a limited number of Futures Commission Merchants to buy and sell Carbon Credit Futures. The Fund may have a limited number of FCMs through which it may buy Carbon Credit Futures. Volatility in the carbon credit markets may lead to the Fund s FCMs to impose risk mitigation procedures that could limit the Fund s investment in Carbon Credit Futures beyond the accountability and position limits imposed. An FCM could impose a financial ceiling on initial margin that could change and become more or less restrictive on the Fund s activities depending upon a variety of conditions beyond the Sponsor s control. If the Fund s FCMs were to impose position limits, or if any other FCM with which the Fund establishes a relationship in the future were to impose position limits, the Fund s ability to meet its investment objective could be negatively impacted. The Fund will seek to monitor and manage its existing relationships with its FCMs and will seek additional relationships with FCMs as needed. The fragmented nature of data regarding the European Union carbon market and the lack of a centralized market monitoring of the European Union carbon market may make it more difficult to identify potential market manipulation and abusive practices. Due to the existing legal framework, data regarding the European Union carbon market is fragmented, with each available dataset having a specific scope regarding the counterparties and types of instruments covered. Additionally, while all EU ETS operations have been centralized into a single EU registry operated by the EU Commission (the "Union Registry") in 2012, there is no centralized market monitoring of the EU Carbon Market and is instead largely conducted by individual EU member states, namely Germany, Netherlands and Norway. As a result of this lack of centralized market monitoring of the EU carbon market at the EU level, tools to detect and deter fraudulent or manipulative trading activities (such as market manipulation, front-running of trades, and "wash-trading") may not be available to or employed by EUA markets or may not exist at all. As a result of reduced oversight, these schemes may be more prevalent in EUA markets than in the general market for financial products. The potential consequences of the EUA market s failure or failure to prevent market manipulation could adversely affect the value of the Shares. Any market abuse, and a loss of investor confidence in EUAs, may adversely impact pricing trends in EUA markets broadly, as well as an investment in Shares of the Fund. The Fund may experience a loss if it is required to sell cash equivalents at a price lower than the price at which they were acquired. If the Fund is required to sell its cash equivalents at a price lower than the price at which they were acquired, the Fund will experience a loss. This loss may adversely impact the price of the Shares and may decrease the correlation between the price of the Shares and the Index. The value of cash equivalents held by the Fund generally moves inversely with movements in interest rates. The prices of longer maturity securities are subject to greater market fluctuations as a result of changes in interest rates. While the short-term nature of the Fund s investments in cash equivalents should minimize the interest rate risk to which the Fund is subject, it is possible that the cash equivalents held by the Fund will decline in value. Certain of the Fund s investments could be illiquid, which could cause large losses to investors at any time. If the Fund s ability to obtain exposure to Carbon Credit Futures in accordance with its investment objective is disrupted for any reason including, because of limited liquidity or a disruption in the carbon credit futures market, or as a result of margin requirements or position limits imposed by the Fund s FCMs, exchanges, or the CFTC, the Fund may not be able to achieve its investment objective and may experience significant losses. Any disruption in the Fund s ability to obtain exposure to Carbon Credit Futures will cause the Fund s performance to deviate from the performance of Index. In addition, the Fund might grow to a size where a lack of liquidity in the futures market meant that the Fund could not sell enough futures contracts to honor redemption requests. Unexpected market illiquidity may cause major losses to investors at any time or from time to time. Because Carbon Credit Futures may be illiquid, the Fund s holdings may be more difficult to liquidate at favorable prices in periods of illiquid markets and losses may be incurred during the period in which positions are being liquidated. Risks Related to the Index The Fund seeks the investment performance of the Index and is accordingly subject to the risks associated therewith. The Fund is not actively managed; rather, the Fund seeks the investment performance of the Index through its investments in bitcoin and the Carbon Credit Futures that comprise the Index. The Fund seeks this exposure regardless of the investment merits associated with the assets. The Fund does not seek to outperform the returns of the Index. The Index has a limited operating history and may perform in unanticipated ways. The Index is new and has a limited performance history. There is no assurance that Kaiko and Solactive will compile the Index accurately, or that the Index will be determined, composed or calculated accurately. While Kaiko provides descriptions of what the Index is designed to achieve, neither Kaiko, Solactive nor either of its agents provide any warranty or accept any liability in relation to the quality, accuracy or completeness of the Index or its related data, and they do not guarantee that the Index will be in line with the methodology. The Sponsor does not provide any warranty or guarantee against the errors of Kaiko or Solactive or any agent thereof. Kaiko and/or Solactive could experience system failures or errors. If the computers or other facilities of Kaiko and/or Solactive, data providers and/or relevant stock exchange malfunction for any reason, calculation and dissemination of the Index may be delayed. Errors in Index data, the Index computations and/or construction may occur from time to time and may not be identified and/or corrected for a period of time or at all, which may have an adverse impact on the Fund and the Shareholders. Any of the foregoing may lead to the errors in the Index, which may lead to a different investment outcome for the Fund and its Shareholders than would have been the case had such events not occurred. Consequently, losses or costs associated with the Index s errors or other risks described above will generally be borne by the Fund and the Shareholders and neither the Sponsor nor its affiliates or agents make any representations or warranties regarding the foregoing. The Fund may not be successful in implementing its investment strategies to track the performance of the Index. Although the Fund will attempt to structure its portfolio so that investments track the Index, the Fund may not achieve the desired degree of correlation between its performance and that of the Index, and thus may not achieve its investment objective. The difference in performance may be due to factors such as fees, transaction costs, redemptions of, and subscriptions for, Shares, pricing differences or the cost to the Trust of complying with various new or existing regulatory requirements. Tracking error risk may be heightened in volatile markets or under other unusual market conditions. Risks related to pricing. The Fund s portfolio will be priced, including for purposes of determining NAV, based upon the estimated fair market value for bitcoin determined by Kaiko, as well as the price of the Carbon Credit Futures that comprise the Index. The price of bitcoin in U.S. Dollars or in other currencies available from other data sources may not be equal to the prices used to calculate the NAV. Kaiko Provider has substantial discretion at any time to change the methodology used to determine the estimated fair market value of bitcoin, including the spot markets underlying its methodology. Neither Kaiko nor Solactive is under any obligations to take the needs of the Fund, the Fund s Shareholders or anyone else into consideration in connection with such changes. The Index Pricing Sources (defined below) used by Kaiko are digital asset spot markets that facilitate the buying and selling of bitcoin and other digital assets. Although many Index Pricing Sources refer to themselves as "exchanges," they are not registered with, or supervised by, the SEC or CFTC and do not meet the regulatory standards of a national securities exchange or designated contract market. For these reasons, among others, purchases and sales of bitcoin may be subject to temporary distortions or other disruptions due to various factors, including the lack of liquidity in the markets and government regulation and intervention. These circumstances could affect the price of bitcoin determined by Kaiko. The NAV of the Fund will change as fluctuations occur in the market price of the Fund s bitcoin holdings and Carbon Credit Futures exposure. Shareholders should be aware that the public trading price per Share may be different from the NAV for a number of reasons, including price volatility, trading activity, the closing of bitcoin trading platforms due to fraud, failure, security breaches or otherwise, and the fact that supply and demand forces at work in the secondary trading market for Shares are related, but not identical, to the supply and demand forces influencing the market price of bitcoin. Shareholders also should note that the size of the Fund in terms of total bitcoin held may change substantially over time and as Creation Baskets are created and redeemed, even though such issuances and redemptions of Baskets will be effectuated in cash. In the event that the value of the Fund s bitcoin holdings and/or NAV is incorrectly calculated, neither the Sponsor nor the Administrator will be liable for any error and such misreporting of valuation data could adversely affect the value of the Shares. The Index price being used in calculating the price of bitcoin may not be consistent with GAAP. To the extent that the Fund s financial statements are determined using a different pricing source that is consistent with GAAP, the NAV reported in the Fund s periodic financial statements may differ, in some cases significantly, from the Fund s NAV determined using the Index pricing. The Fund will determine its NAV on each Business Day based on the value of bitcoin and Carbon Credit Futures represented in the portfolio. The methodology used to value bitcoin by the Index and by the Fund in its calculation of NAV may not be deemed consistent with GAAP. To the extent the methodology used to calculate bitcoin is deemed inconsistent with GAAP, the Fund will utilize an alternative GAAP-consistent pricing source for purposes of the Fund s periodic financial statements. Creation and redemption of Baskets, the Sponsor s management fee and other expenses borne by the Fund will be determined using the Fund s NAV determined daily in accordance with the Index s and Fund s pricing methodology. Such NAV of the Fund determined using this methodology may differ, and in some cases significantly, from the NAV reported in the Fund s periodic financial statements. Risks Related to the Fund and the Shares Shareholders do not have the protections associated with ownership of shares in an investment company registered under the Investment Company Act. The Investment Company Act is designed to protect investors by preventing insiders from managing investment companies to their benefit and to the detriment of public investors, such as: the issuance of securities having inequitable or discriminatory provisions; the management of investment companies by irresponsible persons; the use of unsound or misleading methods of computing earnings and asset value; changes in the character of investment companies without the consent of investors; and investment companies from engaging in excessive leveraging. To accomplish these ends, the Investment Company Act requires the safekeeping and proper valuation of fund assets, greatly restricts transactions with affiliates, limits leveraging, and imposes governance requirements as a check on fund management. The Fund is not registered as an investment company under the Investment Company Act and the Sponsor believes that the Fund is not required to register under such act. Consequently, Shareholders do not have the regulatory protections provided to investors in investment companies. The Fund is a passive investment vehicle. The Fund is not actively managed and will be affected by a general decline in the price of its assets. The Fund is a passive investment vehicle that does not seek to generate returns beyond tracking the value of the Index. The Sponsor does not actively manage the assets held by the Fund. This means the Sponsor does not speculatively sell assets at times when their prices are high, or acquire assets at low prices in the expectation of future price increases. It also means the Sponsor does not make use of any of the hedging techniques available to professional bitcoin investors to attempt to reduce the risks of losses resulting from price decreases. Any losses sustained by the Fund will adversely affect the value of your Shares. The amount of the Fund s assets represented by each Share will decline over time as the Fund pays the Management Fee and additional expenses borne by the Fund, and as a result, the value of the Shares may decrease over time. The amount of assets represented by each Share will decrease over the life of the Fund due to the Fund paying the Management Fee and other Fund expenses. Without increases in the price of bitcoin and/or Carbon Futures Credits sufficient to compensate for that decrease, the price of the Shares will also decline and you will lose money on your investment in Shares. Although the Sponsor has agreed to assume all organizational and certain ordinary administrative and marketing expenses incurred by the Fund, not all Fund expenses have been assumed by the Sponsor. For example, any taxes and other governmental charges that may be imposed on the Fund s property will not be paid by the Sponsor. The Fund also pays all transaction related fees and expenses charged in connection with trading activities for the Fund s investments and for maintenance of its CFTC regulatory status as a commodity pool. Because the Fund does not have any income, it needs to sell assets to cover the Management Fee and expenses not assumed by the Sponsor. The Fund may also be subject to other liabilities (for example, as a result of litigation) that have also not been assumed by the Sponsor. The only source of funds to cover those liabilities will be sales of bitcoin and Carbon Credit Futures held by the Fund. The result of these sales is a decrease in the amount of assets represented by each Share. New deposits of bitcoin and/or Carbon Credit Futures, received in exchange for new Shares issued by the Fund, do not reverse this trend. A decrease in the amount of bitcoin and/or exposure to Carbon Credit Futures represented by each Share results in a decrease in its price even if the price of bitcoin and/or Carbon Credit Futures has not changed. To retain the Share s original price, the price of the Fund s assets has to increase. Without that increase, the reduced amount of Fund assets represented by the Share will have a correspondingly lower price. If these increases do not occur, or are not sufficient to counter the lesser amount of Fund assets represented by each Share, you will sustain losses on your investment in Shares. An increase in the Fund expenses not assumed by the Sponsor, or the existence of unexpected liabilities affecting the Fund, will force the Sponsor to sell larger amounts of its assets, and will result in a more rapid decrease of the amount of assets represented by each Share and a corresponding decrease in its value. The Fund has a limited number of financial institutions that may act as Authorized Purchasers. The Fund has a limited number of financial institutions that may act as Authorized Purchasers. To the extent they cannot or are otherwise unwilling to engage in creation and redemption transactions with the Fund and no other Authorized Purchaser steps in, shares of the Fund may trade at a significant discount to NAV and may face delisting from the Exchange. There are certain risks and tax considerations due to the Fund s cash transactions for the creation and redemption processes. Like other ETFs, the Fund sells and redeems its shares only in large blocks called Creation Baskets and only to "Authorized Purchasers." Unlike many other ETFs, however, the Fund expects to effect its creations and redemptions fully for cash, rather than in-kind securities. Paying redemption proceeds in cash rather than through in-kind delivery of portfolio securities may require the Fund to dispose of or sell portfolio investments to obtain the cash needed to distribute redemption proceeds at an inopportune time, and the Fund may recognize taxable gain on such dispositions or sales. The use of cash creations and redemptions may adversely affect the arbitrage transactions by Authorized Purchasers intended to keep the price of the Shares closely linked to the Fund s NAV, and as a result, the price of Shares may fall or otherwise diverge from NAV. The use of cash creations and redemptions, as opposed to in-kind creations and redemptions, could cause delays in trade execution due to potential operational issues arising from implementing a cash creation and redemption model, which involves greater operational steps (and therefore execution risk) than the in-kind creation and redemption model. Such delays could cause the execution price associated with such trades to materially deviate from the Fund s NAV. Even though the Authorized Purchaser is responsible for the dollar cost of such difference in prices, Authorized Purchasers could default on their obligations to the Fund, or such potential risks and costs could lead to Authorized Purchasers, who would otherwise be willing to purchase or redeem Baskets to take advantage of any arbitrage opportunity arising from discrepancies between the price of the Shares and the price of the underlying Fund assets, to elect to not participate in the Fund s Share creation and redemption processes. This may adversely affect the arbitrage mechanism intended to keep the price of the Shares closely linked to the Fund s NAV, and as a result, the price of the Shares may fall or otherwise diverge from NAV. If the arbitrage mechanism is not effective, purchases or sales of Shares on the secondary market could occur at a premium or discount to NAV, which could harm Shareholders by causing them buy Shares at a price higher than the value of the underlying bitcoin held by the Fund or sell Shares at a price lower than the value of the Fund s assets, causing Shareholders to suffer losses. Alternatively, Authorized Purchasers could refrain from participating in creating and redeeming Baskets, and if not replaced, could disrupt the Fund s ability to operate. There is a risk of stale pricing when the markets in which the Fund s investments trade are closed. Because certain of the Fund s investments trade in markets that are closed when the Fund and Exchange are open, there are likely to be deviations between current pricing of an underlying security and stale pricing, resulting in the Fund trading at a discount or premium to NAV greater than those incurred by other ETFs. The Fund is new and investing in the Fund s Shares may have more risks than an investment in an established, larger fund. The Fund is new and does not yet have shares outstanding. If the Fund does not grow large in size once it commences trading, it will be at greater risk than larger funds of wider bid-ask spreads for its shares, trading at a greater premium or discount to NAV, liquidation and/or a stop to trading. There may be times when the market price of the Fund s Shares is more than the NAV intra-day (at a premium) or less than the NAV intra-day (at a discount). As a result, the Fund s Shareholders may pay more than NAV when purchasing shares and receive less than NAV when selling Fund Shares. There may be times when the market price of the Fund s Shares is more than the NAV intra-day (at a premium) or less than the NAV intra-day (at a discount). As a result, the Fund s Shareholders may pay more than NAV when purchasing shares and receive less than NAV when selling Fund Shares. This risk is heightened in times of market volatility or periods of steep market declines. In such market conditions, market or stop loss orders to sell Fund Shares may be executed at prices well below NAV. Secondary market trading is subject to bid-ask spreads and trading in Fund Shares may be halted by the Exchange because of market conditions or other reasons. Investors buying or selling shares in the secondary market will normally pay brokerage commissions, which are often a fixed amount and may be a significant proportional cost for investors buying or selling relatively small amounts of shares. Secondary market trading is subject to bid-ask spreads and trading in Fund Shares may be halted by the Exchange because of market conditions or other reasons. If a trading halt occurs, a shareholder may temporarily be unable to purchase or sell Shares of the Fund. In addition, although the Fund s Shares are listed on the Exchange, there can be no assurance that an active trading market for shares will develop or be maintained or that the Fund s shares will continue to be listed. As the Sponsor and its management have limited history of operating investment vehicles like the Fund, their experience may be inadequate or unsuitable to manage the Fund. The past performances of the Sponsor s management in other investment vehicles are no indication of their ability to manage an investment vehicle such as the Fund. If the experience of the Sponsor and its management is inadequate or unsuitable to manage an investment vehicle such as the Fund, the operations of the Fund may be adversely affected. Furthermore, the Sponsor is currently engaged in the management of other investment vehicles which could divert their attention and resources. If the Sponsor were to experience difficulties in the management of such other investment vehicles that damaged the Sponsor or its reputation, it could have an adverse impact on the Sponsor s ability to continue to serve as Sponsor for the Fund. Investors cannot be assured of the Sponsor s continued services, the discontinuance of which may be detrimental to the Fund. Investors cannot be assured that the Sponsor will be able to continue to service the Fund for any length of time. If the Sponsor discontinues its activities on behalf of the Fund, the Fund may be adversely affected, as there may be no entity servicing the Fund for a period of time, and it will not have a CPO and CTA. If the Sponsor s registrations with the CFTC or memberships in the NFA were revoked or suspended, the Sponsor, as applicable, would no longer be able to provide services and/or to render advice to the Fund. If the Sponsor were unable to provide services and/or advice to the Fund, the Fund would be unable to pursue its investment objectives unless and until the Sponsor s ability to provide services and advice to the Fund was reinstated or a replacement for the Sponsor CPO or CTA, could be found. Such an event could result in termination of the Fund. The value of the Shares could decrease if unanticipated operational or trading problems arise. The mechanisms and procedures governing the creation, redemption and offering of the Shares and storage of the Fund s bitcoin has been developed specifically for this product offering. There may be unanticipated problems or issues with respect to the mechanics of the Fund s operations and the trading of the Shares that could have an adverse effect on an investment in the Shares. In addition, although the Fund is not actively "managed" by traditional methods, to the extent that unanticipated operational or trading problems or issues arise, the Sponsor s past experience and qualifications may not be suitable for solving these problems or issues. If the processes of creation and redemption of Baskets encounter any unanticipated difficulties, the opportunities for arbitrage transactions intended to keep the price of the Shares closely linked to the Fund s NAV may not exist and, as a result, the price of the Shares may fall. If the creation and redemption of the Shares encounter any unanticipated difficulties, including, but not limited to, the Fund s inability in the future to obtain regulatory approvals for the offer and sale of additional Shares after the present offering is completed, potential market participants who would otherwise be willing to purchase or redeem Baskets to take advantage of any arbitrage opportunity arising from discrepancies between the price of the Shares and the price of the underlying assets may not take the risk that, as a result of those difficulties, they may not be able to realize the profit they expect. If this is the case, the liquidity of Shares and price of Shares may decline independent of the NAV of Shares. The postponement, suspension or rejection of creation or redemption orders may adversely affect an investment in the Shares. Under the Trust Agreement, the Sponsor may suspend or reject creation or redemption orders, as applicable, for a variety of permitted reasons under certain circumstances. To the extent such orders are suspended or rejected, the arbitrage mechanism resulting from the process through which Authorized Purchasers create and redeem Shares directly with the Fund may fail to closely link the price of the Shares to the price of the underlying products in the relevant commodities markets, as measured using the Bitcoin Price. If this is the case, the liquidity of the Shares may decline and the price of the Shares may fluctuate independently of the value of the investments which comprise the Index and may fall. The Fund could experience unforeseen difficulties in operating and maintaining key elements of its technical infrastructure. The Bitcoin Account has been designed specifically to provide security for the bitcoin portion of the Fund s assets, and may be expanded, updated and altered from time to time. Any effort to expand, update or alter the security system is likely to be complex, and unanticipated delays in the completion of these projects may lead to unanticipated project costs, operational inefficiencies or vulnerabilities to security breaches. In addition, there may be problems with the design or implementation of the Bitcoin Account or with an expansion or upgrade thereto that are not evident during the testing phases of design and implementation, and that may only become apparent after the Fund has utilized the infrastructure. Any issues relating to the performance and effectiveness of the security procedures used by the Fund and the Bitcoin Custodian to protect the Bitcoin Account, such as algorithms, codes, passwords, multiple signature systems, encryption and telephone call-backs (together, the "Security Procedures"), may have an adverse impact on an investment in the Shares. The Security Procedures implemented by the Bitcoin Custodian are technical and complex, and the Fund depends on the Security Procedures to protect the storage, acceptance and distribution of data relating to bitcoin and the digital wallets into which the Fund deposits its assets. The Security Procedures may not protect against all errors, software flaws (i.e., bugs) or vulnerabilities. Defects in the Security Procedures may only be discovered after a failure in the Bitcoin Custodian s safekeeping and storage of the bitcoin portion of the Fund s assets. It is not uncommon for businesses in the bitcoin space to experience large losses due to fraud and breaches of their security systems. For example, in September 2015, the global bitcoin payment agent, BitPay, lost approximately $1.8 million of bitcoin due to a hacker s fraudulent impersonation of BitPay s CFO, whereby the hacker was able to access the CFO s email account and successfully request BitPay s custodian to transfer funds. The Fund s and the Bitcoin Custodian s ability to adopt technology in response to changing security needs or trends poses a challenge to the safekeeping of the bitcoin portion of the Fund s assets. Digital asset trading platforms and large holders of bitcoin must adapt to technological change in order to secure and safeguard client accounts. While the Sponsor believes the Security Procedures in place have been reasonably designed to safeguard the Fund s assets from theft, loss, destruction or other issues relating to hackers and technological attack, such assessment is based upon known technology and threats. As technological change occurs, the security threats to the Fund s bitcoin will likely adapt and previously unknown threats may emerge. Furthermore, the Sponsor believes that the Fund may become a more appealing target of security threats as the size of the Fund s assets grows. To the extent that the Fund or the Bitcoin Custodian is unable to identify and mitigate or stop new security threats, the Fund s assets may be subject to theft, loss, destruction or other attack, which could have a negative impact on the performance of the Shares or result in loss of the Fund s assets. Security threats to the Bitcoin Account could result in the halting of Fund operations, the suspension of redemptions, and a loss of Fund assets or damage to the reputation of the Fund, each of which could result in a reduction in the portion of the Shares value that is tied to bitcoin. Security breaches, computer malware and computer hacking attacks have been a prevalent concern in the Bitcoin Platform Market since the launch of the Bitcoin Network. Any security breach caused by hacking, which involves efforts to gain unauthorized access to information or systems, or to cause intentional malfunctions or loss or corruption of data, software, hardware or other computer equipment, and the inadvertent transmission of computer viruses, could harm the Fund s business operations or result in loss of the Fund s assets. Any breach of the Fund s infrastructure could result in damage to the Fund s reputation and reduce demand for the Shares, resulting in a reduction in the price of the Shares. Furthermore, the Sponsor believes that, as the bitcoin portion of the Fund s assets grow, it may become a more appealing target for security threats such as hackers and malware. The Sponsor believes that the Security Procedures that the Sponsor and Bitcoin Custodian utilize are reasonably designed to safeguard the Fund s assets from theft, loss, destruction or other issues relating to hackers and technological attack. Nevertheless, the Security Procedures cannot guarantee the prevention of any loss due to a security breach, software defect or act of God that may be borne by the Fund, absent gross negligence, willful misconduct or bad faith on the part of the Sponsor, the Bitcoin Custodian or their respective agents. The Security Procedures and operational infrastructure may be breached due to the actions of outside parties, error or malfeasance of an employee of the Sponsor or the Bitcoin Custodian, or otherwise, and, as a result, an unauthorized party may obtain access to the Bitcoin Account, private keys, data or assets. Additionally, outside parties may attempt to fraudulently induce employees of the Bitcoin Custodian or the Sponsor to disclose sensitive information in order to gain access to the Fund s infrastructure. As the techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently, or may be designed to remain dormant until a predetermined event and often are not recognized until launched against a target, the Sponsor may be unable to anticipate these techniques or implement adequate preventative measures. If an actual or perceived breach of the Bitcoin Account occurs, the market perception of the effectiveness of the Fund could be harmed, which could result in a reduction in the portion of the Shares value that is tied to bitcoin. In the event of a security breach of the Bitcoin Account, the Fund may cease operations, suspend redemptions or suffer a reduction in assets, the occurrence of each of which could result in a reduction in the portion of the Shares value that is tied to bitcoin. A loss of confidence or breach in the Fund s security and technology policies may adversely affect the Fund and the value of an investment in the Shares. The Fund, Sponsor, Bitcoin Custodian and each of their respective agents will take measures to protect the Fund and its assets from unauthorized access, damage or theft. However, it is possible that the Security Procedures in place may not prevent the improper access to, or damage or theft of the Fund s assets. A security breach could harm the Fund s reputation or result in the loss of some or all of the Fund s assets. A resulting perception that the Security Procedures do not adequately protect the Fund s assets could result in a loss of current or potential Shareholders, reducing demand for, and price of, the Shares. The Fund s assets may be subject to loss, damage, theft or restriction on access. There is a risk that some or all of the Fund s assets could be lost, stolen or destroyed. The Sponsor believes that the Fund s assets held in the Bitcoin Account will be an appealing target to hackers or malware distributors seeking to destroy, damage or steal the Fund s assets. Although the Bitcoin Custodian uses Security Procedures with various elements, neither the Bitcoin Custodian nor the Sponsor can guarantee the prevention of such loss, damage or theft, whether caused intentionally, accidentally or by an act of God. Access to the Fund s assets could also be restricted by natural events (such as an earthquake or flood) or human actions (such as a terrorist attack). Any of these events may adversely affect the operations of the Fund and, consequently, an investment in the Shares. The Shareholders limited rights of legal recourse against the Fund, Trustee, Sponsor, Transfer Agent, Kaiko, Solactive and Custodians expose the Fund and its Shareholders to the risk of loss of the Fund s assets for which no person is liable. Shareholders recourse against the Fund, Trustee, Custodians and Sponsor under New York law or Minnesota law, as applicable, governing their custody operations is limited. Similarly, the Shareholders recourse against the Sponsor, the Transfer Agent, Kaiko and Solactive for the services they provide to the Fund, including those relating to the provision of instructions relating to the movement of bitcoin, is limited. Consequently, a loss may be suffered with respect to the Fund s assets for which no person is liable in damages. Further, there is no third-party insurance to cover any loss that may be suffered with respect to the Fund s assets. Assets held by the Fund are not subject to FDIC or SIPC protections. The Fund is not a banking institution or otherwise a member of the Federal Deposit Insurance Corporation ("FDIC") or Securities Investor Protection Corporation ("SIPC") and, therefore, deposits held with or assets held by the Fund are not subject to the protections enjoyed by depositors with FDIC or SIPC member institutions. The undivided interests in the Fund s assets represented by Shares in the Fund are not insured directly by the Trustee or the Sponsor. The Custodians limited liability under the respective Bitcoin Custody Agreement or Non-Digital Custody Agreement may impair the ability of the Fund to recover losses relating to its assets and any recovery may be limited, even in the event of fraud, to the market value of the assets at the time the fraud is discovered. Under the respective Bitcoin Custody Agreement and the Non-Digital Custody Agreement, the respective custodian s liability is limited to the greater of (i) the market value of the Fund s assets at the time the events giving rise to the liability occurred and (ii) the fair market value of the Fund s assets at the time that the custodian notifies the Sponsor or Trustee in writing, or the Sponsor or the Trustee otherwise has actual knowledge of the events giving rise to the liability. In addition, the Bitcoin Custodian and Non-Digital Custodian will not be liable for any delay in performance or any non-performance of any of its custodial obligations under the Trust Agreement by reason of any cause beyond its reasonable control, including acts of God, war or terrorism. The Bitcoin Custodian and Non-Digital Custodian will also not be liable for any system failure or third-party penetration of the Fund s accounts, unless such system failure or third-party penetration is the result of gross negligence, bad faith or willful misconduct on the part of the Bitcoin Custodian or Non-Digital Custodian. As a result, the recourse of the Fund or the Shareholder, under New York law or Minnesota law, as applicable, may be limited. The Fund may not have adequate sources of recovery if its assets are lost, stolen or destroyed. If the Fund s assets are lost, stolen or destroyed under circumstances rendering a party liable to the Fund, the responsible party may not have the financial resources sufficient to satisfy the Fund s claim. For example, as to a particular event of loss, the only source of recovery for the Fund might be limited to the applicable Bitcoin Custodian or Non-Digital Custodian or, to the extent identifiable, other responsible third parties (for example, a thief or terrorist), any of which may not have the financial resources (including liability insurance coverage) to satisfy a valid claim of the Fund. The liquidity of the Shares may be affected if Authorized Purchasers cease to perform their obligations under the Authorized Purchaser Agreements. In the event that one or more Authorized Purchasers having substantial interests in Shares or otherwise responsible for a significant portion of the Shares daily trading volume on the Exchange terminates its Authorized Purchaser Agreement, the liquidity of the Shares would likely decrease, which could adversely affect the market price of, and an investment in, the Shares. There is no guarantee that an active trading market for the Shares will develop. To the extent that no active trading market develops and the assets of the Trust do not reach a viable size, the liquidity of the Shares may be limited or the Trust may be terminated at the option of the Sponsor. There can be no assurance an active trading market of the Shares will develop on the Exchange. The Sponsor may elect to terminate the Fund if it determines, in its sole discretion, that the Fund is not an economically viable size, which could result in the liquidation of the Fund s assets at a time that is disadvantageous to Shareholders. If the Fund fails to achieve sufficient scale due to competition, the Sponsor may have difficulty raising sufficient revenue to cover the costs associated with launching and maintaining the Fund, and such shortfalls could impact the Sponsor s ability to properly invest in robust ongoing operations and controls of the Fund to minimize the risk of operating events, errors, or other forms of losses to the Shareholders. To the extent that the Exchange halts trading in the Shares, whether on a temporary or permanent basis, investors may not be able to buy or sell Shares, thus adversely affecting an investment in the Shares. If an active trading market for the Shares does not exist or continue to exist, the market prices and liquidity of the Shares may be adversely affected. In addition, the Fund may also fail to attract adequate liquidity in the secondary market due to such competition, resulting in a sub-standard number of Authorized Purchasers willing to make a market in the Shares, which in turn could result in a significant premium or discount in the Shares for extended periods and the Fund s failure to achieve its investment objective. The Fund may be required to terminate and liquidate at a time that is disadvantageous to Shareholders. If the Fund is required to terminate and liquidate, such termination and liquidation could occur at a time that is disadvantageous to Shareholders, such as when the value of the investments that comprise the Index is lower than it was at the time when Shareholders purchased their Shares. In such a case, the resulting proceeds distributed to Shareholders will be less than if the value of the investments that comprise the Index were higher at the time of sale. See "Additional Information About the Trust—Description of the Trust Agreement—Termination of the Trust" for more information about the termination of the Fund, including when the termination of the Fund may be triggered by events outside the direct control of the Sponsor, the Trustee or the Shareholders. The Trust Agreement includes a provision that restricts the right of a beneficial owner of a statutory trust from bringing a derivative action. Under Delaware law, the right of a beneficial owner of a statutory trust (such as a Shareholder of the Fund) to bring a derivative action (i.e., to initiate a lawsuit in the name of a the statutory trust in order to assert a claim belonging to the statutory trust against a fiduciary of the statutory trust or against a third-party when the statutory trust s management has refused to do so) may be restricted by the terms of the governing instrument of the statutory trust. The Trust Agreement provides that in addition to any other requirements of applicable law, no Shareholder shall have the right, power or authority to bring or maintain a derivative action, suit or other proceeding on behalf of the Fund unless two or more Shareholders who (i) are not affiliates of one another and (ii) collectively hold at least 10% of the outstanding Shares join in the bringing or maintaining of such action, suit or other proceeding. Therefore, the Trust Agreement limits the likelihood that a Shareholder could successfully assert a derivative action. The Administrator is responsible for determining the value of the Fund s assets, and any errors, discontinuance or changes in such valuation calculations may have an adverse effect on the value of the Shares. The Administrator will determine the Fund s NAV and NAV per Share on a daily basis as soon as practicable after 4:00 p.m. Eastern Time on each business day. The Administrator s determination is made utilizing data from the Non-Digital Custodian operations and the value of bitcoin as determined by the Index, calculated at 4:00 p.m. Eastern Time on such day. To the extent that the Fund s NAV or NAV per Share are incorrectly calculated, the Administrator may not be liable for any error and such misreporting of valuation data could adversely affect an investment in the Shares. If the Fund incurs extraordinary expenses in U.S. Dollars, the Fund will sell bitcoins and Carbon Credit Futures to pay these expenses. The sale of the Fund s bitcoins and Carbon Credit Futures to pay expenses at a time of low bitcoin prices or low Carbon Credit Future prices could adversely affect the value of the Shares. The Sponsor will sell bitcoins and/or exposure to Carbon Credit Futures held by the Fund to pay Fund expenses not assumed by the Sponsor on an as-needed basis, irrespective of then-current prices. The Fund is not actively managed and no attempt will be made to protect against or to take advantage of fluctuations in the price of bitcoins and/or Carbon Credit Futures. Consequently, if the Fund incurs expenses in U.S. Dollars, the Fund s bitcoins and exposure to Carbon Credit Futures may be sold at a time when bitcoin prices and/or Carbon Credit Future prices are low, resulting in a negative impact on the value of the Shares. Intellectual property rights claims may adversely affect the Fund and an investment in the Shares. The Sponsor is not aware of any intellectual property rights claims that may prevent the Fund from operating and holding bitcoins and/or carbon credit futures; however, third parties may assert intellectual property rights claims relating to the operation of the Fund and the mechanics instituted for the investment in carbon credit futures contracts and the investment in, holding of and transfer of bitcoins. Regardless of the merit of an intellectual property or other legal action, any legal expenses to defend or payments to settle such claims would be Additional Fund Expenses and be borne by the Fund. Additionally, a meritorious intellectual property rights claim could prevent the Fund from operating and force the Sponsor to terminate the Fund and liquidate the Fund s assets. As a result, an intellectual property rights claim against the Fund could adversely affect an investment in the Shares. The Fund is an "emerging growth company" and it cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make the Shares less attractive to investors. The Fund is an "emerging growth company" as defined in the JOBS Act. For as long as the Fund continues to be an emerging growth company it may choose to take advantage of certain exemptions from various reporting requirements applicable to other public companies but not to emerging public companies, which include, among other things: exemption from the auditor attestation requirements under Section 404(b) of the Sarbanes-Oxley Act; reduced disclosure obligations regarding executive compensation in the Fund s periodic reports and audited financial statements in this prospectus; exemptions from the requirements of holding advisory "say-on-pay" votes on executive compensation and shareholder advisory votes on "golden parachute" compensation; and exemption from any rules requiring mandatory audit firm rotation and auditor discussion and analysis and, unless otherwise determined by the SEC, any new audit rules adopted by the Public Company Accounting Oversight Board. The Fund could be an emerging growth company until the last day of the fiscal year following the fifth anniversary after its initial public offering, or until the earliest of (1) the last day of the fiscal year in which it has annual gross revenue of $1.235 billion or more, (2) the date on which it has, during the previous three year period, issued more than $1 billion in non-convertible debt or (3) the date on which it is deemed to be a large accelerated filer under the federal securities laws. The Fund will qualify as a large accelerated filer as of the first day of the first fiscal year after it has (A) more than $700 million in outstanding equity held by nonaffiliates, (B) been public for at least 12 months and (C) filed at least one annual report on Form 10-K. Under the JOBS Act, emerging growth companies are also permitted to elect to delay adoption of new or revised accounting standards until companies that are not subject to periodic reporting obligations are required to comply, if such accounting standards apply to non-reporting companies. However, the Fund has chosen to opt out of this extended transition period for complying with new or revised accounting standards. Section 107 of the JOBS Act provides that the decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable. The Fund cannot predict if investors will find an investment in the Fund less attractive if it relies on these exemptions. If regulatory changes or interpretations of an Authorized Purchaser s activities require the regulation of an Authorized Purchaser as a money service business under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act or as a money transmitter or virtual currency business under state regimes for the licensing of such businesses, an Authorized Purchaser may be required to register and comply with such regulations, which could result in extraordinary, recurring and/or nonrecurring expenses to the Authorized Purchaser or increased commissions for the Authorized Purchaser s clients, thereby reducing the liquidity of the Fund. To the extent that the activities of an Authorized Purchaser cause it to be deemed a "money services business" under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act, an Authorized Purchaser may be required to comply with FinCEN regulations, including those that would mandate an Authorized Purchaser to implement AML programs, make certain reports to FinCEN and maintain certain records. Similarly, the activities of an Authorized Purchaser may require it to be licensed as a money transmitter or as a virtual currency business, such as under NYDFS s BitLicense scheme. Such additional regulatory obligations may cause the Authorized Purchaser to incur extraordinary expenses, possibly increasing the levels of the commissions that an Authorized Purchaser charges its clients in a material and adverse manner. If an Authorized Purchaser determines not to comply with such additional regulatory and registration requirements, an Authorized Purchaser may terminate its role as an Authorized Purchaser of the Fund. Such a termination may decrease the liquidity of the Fund. Additionally, to the extent an Authorized Purchaser is found to have operated without appropriate state or federal licenses, it may be subject to investigation, administrative or court proceedings, and civil or criminal monetary fines and penalties, all of which would harm the reputation of the Fund or its Sponsor, decrease the liquidity of the Fund, and have a material adverse effect on the price of the Shares. Banks may not provide banking services, or may cut off banking services, to businesses that provide bitcoin-related services or that accept bitcoin as payment, which could damage the public perception of bitcoin and the utility of bitcoin as a payment system and could decrease the price of bitcoin and adversely affect the portion of the Shares value that is tied to bitcoin. A number of companies that provide bitcoin-related services have been unable to find banks that are willing to provide them with bank accounts and banking services. Similarly, a number of such companies have had their existing bank accounts closed by their banks. Banks may refuse to provide bank accounts and other banking services to bitcoin-related companies or companies that accept bitcoin for a number of reasons, such as perceived compliance risks or costs. The difficulty that many businesses that provide bitcoin-related services have and may continue to have in finding banks willing to provide them with bank accounts and other banking services may be currently decreasing the usefulness of bitcoin as a payment system and harming public perception of bitcoin or could decrease its usefulness and harm its public perception in the future. Similarly, the usefulness of bitcoin as a payment system and the public perception of bitcoin could be damaged if banks were to close the accounts of many or of a few key businesses providing bitcoin-related services. This could decrease the price of bitcoins and therefore adversely affect the portion of the Shares value that is tied to bitcoin. It may be illegal now, or in the future, to acquire, own, hold, sell or use bitcoins in one or more countries, and ownership of, holding or trading in Shares may also be considered illegal and subject to sanctions. The U.S., China, Russia or other jurisdictions may take regulatory actions in the future that severely restrict the right to acquire, own, hold, sell or use bitcoins or to exchange bitcoins for fiat currency. Such an action may also result in the restriction of ownership, holding or trading in the Shares due to their bitcoin component. Such a restriction could subject the Fund or its Sponsor to investigations, civil or criminal fines and penalties, which could harm the reputation of the Fund or its Sponsor and could result in the termination and liquidation of the Fund at a time that is disadvantageous to Shareholders or may adversely affect an investment in the Shares. If regulatory changes or interpretations of the Fund s or Sponsor s activities require registration as money service businesses under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act or as money transmitters or digital currency businesses under state regimes for the licensing of such businesses, the Fund and/or Sponsor could suffer reputational harm and also extraordinary, recurring and/or nonrecurring expenses, which would adversely impact an investment in the Shares. If regulatory changes or interpretations of the Fund s or Sponsor s activities require the registration of the Fund or Sponsor as a money services business under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act, the Fund or Sponsor may be required to register and comply with such regulations. If regulatory changes or interpretations of the Fund s or Sponsor s activities require the licensing or other registration as a money transmitter or business engaged in digital currency activity (e.g., under the New York BitLicense regime) (or equivalent designation) under state law in any state in which the Fund or Sponsor operates, the Fund or Sponsor may be required to seek licensure or otherwise register and comply with such state law. In the event of any such requirement, to the extent that the Sponsor decides to continue the Fund, the required registrations, licensure and regulatory compliance steps may result in extraordinary, nonrecurring expenses to the Fund. Regulatory compliance would include, among other things, implementing AML and consumer protection programs. The Sponsor may also decide to terminate the Fund. Any termination of the Fund in response to the changed regulatory circumstances may be at a time that is disadvantageous to Shareholders. To the extent the Fund or its Sponsor is found to have operated without appropriate state or federal licenses, it may be subject to investigation, administrative or court proceedings, and civil or criminal monetary fines and penalties, all of which would harm the reputation of the Fund or its Sponsor, decrease the liquidity of the Fund, and have a material adverse effect on the price of the Shares. If the Sponsor decides to comply with such additional federal or state regulatory obligations and continue the Fund, the required registrations, licensure and regulatory compliance steps may result in extraordinary, nonrecurring expenses to the Fund, possibly affecting an investment in the Shares in a material and adverse manner. Furthermore, the Fund and its service providers may not be capable of complying with certain federal or state regulatory obligations applicable to money service businesses money transmitters and businesses involved in digital currency business activity. If the Sponsor determines not to comply with such requirements, the Sponsor will act to dissolve and liquidate the Fund. Any such termination could result in the liquidation of the Fund s bitcoins at a time that is disadvantageous to Shareholders. The classification of the Fund as a corporation for U.S. federal income tax purposes is relatively uncommon. The Fund is classified as a corporation for U.S. federal income tax purposes. This differs from many investment companies, which elect to be treated as "regulated investment companies" under the Code in order to avoid U.S. federal income tax obligations at the entity level. Under current law, the Fund is not eligible to elect treatment as a regulated investment company because the Fund s investments consist primarily of bitcoin. As a result, the Fund will be obligated to pay applicable U.S. federal and state corporate income taxes on its taxable income unlike other investment companies which are not so obligated. The U.S. federal income tax treatment of transactions in digital assets is unclear. Due to the new and evolving nature of digital assets and the absence of comprehensive guidance with respect to digital assets, many significant aspects of the U.S. federal income tax treatment of digital assets such as bitcoin are uncertain. Our dealings in or in connection with digital assets, as well as transactions in digital assets generally, could be subject to adverse tax consequences in the U.S., including as a result of development of the legal regimes surrounding digital assets, and our operating results, as well as the price of digital assets, could be adversely affected thereby. Many significant aspects of the U.S. federal income tax treatment of digital assets (including with respect to the amount, timing and character of income recognition) are uncertain. In 2014, the IRS released a notice (the "Notice") discussing certain aspects of digital assets for U.S. federal income tax purposes and, in particular, providing that such digital assets (1) are "property," (2) are not "currency" for purposes of the rules relating to foreign currency gain or loss and (3) may be held as a capital asset. In 2019, the IRS released a revenue ruling and a set of "Frequently Asked Questions" (the "Ruling & FAQs") that provide some additional guidance, including guidance to the effect that, under certain circumstances, hard forks of digital assets are taxable events giving rise to ordinary income and guidance with respect to the determination of the tax basis of digital assets. The Notice and the Ruling & FAQs, however, do not address other significant aspects of the U.S. federal income tax treatment of digital assets. We do not intend to request a ruling from the IRS on these or any other issues, and we will take positions on these and other U.S. federal income tax issues relating to digital assets that we believe to be reasonable. There can be no assurance that the IRS will agree with the positions we take, and it is possible that the IRS will successfully challenge our positions. There can be no assurance that the IRS will not alter its position with respect to digital assets in the future or that a court would uphold the treatment set forth in the Notice and the Ruling & FAQs. It is also unclear what additional guidance on the treatment of digital assets for U.S. federal income tax purposes may be issued in the future. Any such alteration of the current IRS positions or additional guidance could result in adverse tax consequences for us and could have an adverse effect on the value of bitcoin or other digital assets. Because of the evolving nature of digital assets, it is not possible to predict potential future developments that may arise with respect to digital assets. Such developments may increase the uncertainty with respect to the treatment of digital assets for U.S. federal income tax purposes. For example, the Notice addresses only digital assets that are "convertible virtual currency," and it is conceivable that we will hold certain types of digital assets that are not within the scope of the Notice. On November 15, 2021, President Biden signed the Infrastructure Investment and Jobs Act (the "IIJA") into law. The IIJA implements a set of comprehensive financial account information reporting rules that will apply to persons, including digital asset trading platforms and custodians, that regularly effect transfers of digital assets on behalf of other persons. In particular, these rules will require digital asset trading platforms and custodians to report digital asset transactions (including sales, exchanges and other transfers) effected on behalf of other persons on an annual return, in a manner similar to the current reporting rules for brokers that effect stock and other securities transactions on behalf of customers. The IRS issued proposed regulations on these rules on August 28, 2023. Under the proposed regulations the gross proceeds of sales or exchanges of digital assets must be reported for transactions that take place on or after January 1, 2025, and, in certain circumstances, gain or loss with respect to such sales or exchanges must be reported for transactions that take place on or after January 1, 2026. These rules, the effects of which may depend in significant part on regulations or other guidance from the IRS on their implementation, could create significant compliance burdens for us and our investors, and could affect the price of digital assets, which could have an adverse effect on our investments. In addition, the Sponsor has committed to cause the Fund to irrevocably abandon any Incidental Rights and IR Virtual Currency to which the Fund may become entitled in the future. However, there can be no assurance that these abandonments would be treated as effective for U.S. federal income tax purposes, or that the Sponsor will continue to cause the Fund to irrevocably abandon any Incidental Rights and IR Virtual Currency if there are any future regulatory developments that would make it feasible for the Fund to retain those assets. The state, local and non-U.S. tax treatment of digital assets is unclear. The taxing authorities of certain states (i) have announced that they will follow the Notice with respect to the treatment of digital assets for state income tax purposes and/or (ii) have issued guidance exempting the purchase and/or sale of digital assets for fiat currency from state sales tax. It is unclear what further guidance on the treatment of digital assets for state tax purposes may be issued in the future. Any future guidance on the treatment of digital assets for state or local tax purposes could result in adverse tax consequences to us and could adversely affect the price of digital assets. The treatment of digital assets for tax purposes by non-U.S. jurisdictions may differ from the treatment of digital currency for U.S. federal, state or local tax purposes. It is possible, for example, that a non-U.S. jurisdiction would impose sales tax or value-added tax on purchases and sales of digital assets for fiat assets. For instance, if a foreign jurisdiction with a significant share of the market of bitcoin users imposes onerous tax burdens on digital asset users or imposes sales or value-added tax on purchases and sales of digital assets for fiat assets, such actions could result in decreased demand for digital currency in such jurisdiction, which could adversely affect the price of digital assets. Each potential investor is urged to consult his, her or its own tax advisor regarding the tax treatment of digital assets and the tax consequences of investing in the Fund. Risks Related to Potential Conflicts of Interest Potential conflicts of interest may arise among the Sponsor or its affiliates and the Fund. The Trust Agreement modifies and restricts the default fiduciary duties under the DSTA, which may permit them under state law to favor their own interests to the detriment of the Fund and its Shareholders. That notwithstanding, the Sponsor is a registered investment adviser under the Advisers Act and is subject to fiduciary duties therewith. The Sponsor will manage the business and affairs of the Fund. Conflicts of interest may arise among the Sponsor and its affiliates, on the one hand, and the Fund and its Shareholders, on the other hand. As a result of these conflicts, the Sponsor may favor its own interests and the interests of its affiliates over the Fund and its Shareholders. These potential conflicts include, among others, the following: The Sponsor s default fiduciary duties under the DSTA are modified and restricted pursuant to the Trust Agreement in accordance with the DSTA, and is allowed to take into account the interests of parties other than, the Fund and its Shareholders in resolving conflicts of interest; The Fund has agreed to indemnify the Sponsor and its affiliates pursuant to the Trust Agreement; The Sponsor is responsible for allocating its own limited resources among different clients and potential future business ventures, to each of which it owes fiduciary duties; The Sponsor s staff also services affiliates of the Sponsor and their respective clients and cannot devote all of its, or their, respective time or resources to the management of the business and affairs of the Fund; The Sponsor, its affiliates and their officers and employees are not prohibited from engaging in other businesses or activities, including those that might be in direct competition with the Fund; There is an absence of arm s-length negotiation with respect to certain terms of the Fund, and, where applicable, there has been no independent due diligence conducted with respect to this offering; The Sponsor decides whether to retain separate counsel, accountants or others to perform services for the Fund; and The Sponsor may appoint an agent to act on behalf of the Shareholders, which may be the Sponsor or an affiliate of the Sponsor. By investing in the Shares, investors agree and consent to the provisions set forth in the Trust Agreement. That notwithstanding, the Sponsor is a registered investment adviser under the Advisers Act and is subject to fiduciary duties in connection therewith. For a further discussion of the conflicts of interest among the Sponsor, Authorized Purchasers, Kaiko, Solactive, Bitcoin Custodian and/or Non-Digital Custodian, Fund and others, see "Conflicts of Interest." Affiliates of the Sponsor may invest in or trade bitcoin and/or carbon credit futures without regard to the interests of the Fund or its Shareholders. Affiliates of the Sponsor may have direct investments in bitcoins and/or invest in carbon credit futures contracts. Such affiliates of the Sponsor are permitted to manage such investments, taking into account their own interests, without regard to the interests of the Fund or its Shareholders. Affiliates of the Sponsor may obtain exposure to bitcoins and carbon credit futures through investment in the Shares. To the extent that any substantial investment in bitcoins and/or carbon credit futures contracts is initiated, materially increased or materially reduced, such investment can affect the Bitcoin Price and/or value of the Carbon Credit Futures. The initiation of, or material increases in, a substantial investment in bitcoins and/or carbon credit futures may result in an increase in the value of the Index. A material reduction in a substantial investment may result in a decrease in the Bitcoin price and/or Carbon Credit Futures, having a negative impact on the value of Shares. See "Conflicts of Interest—General." The Bitcoin Custodian nor the Non-Digital Custodian owe any fiduciary duties to the Fund or the Shareholders, are not required to act in their best interest and could resign or be removed by the Sponsor, which could trigger early termination of the Fund. The Bitcoin Custodian nor the Non-Digital Custodian is a trustee for, and owes no fiduciary duties to, the Fund or the Shareholders. In addition, the Custodians have no duty to continue to act as a custodian of the Fund. Any of the Custodians can terminate its role as custodian for any reason whatsoever upon the notice period provided under the respective Bitcoin Custody Agreement or Non-Digital Custody Agreement. The Custodians may also be terminated. If one of the Custodians resigns or is removed without replacement, the Fund will dissolve in accordance with the terms of the Trust Agreement. The Custodians ability to adopt technology in response to changing security needs or trends poses a challenge to the safekeeping of the Fund s assets. While the Bitcoin Custodian is required to safeguard the Bitcoin Assets from theft, loss, destruction or other issues relating to hackers and technological attack, its ability to do so is based upon known technology and threats. As technological change occurs, the security threats to the Bitcoin Assets will likely adapt and previously unknown threats may emerge. Furthermore, the Sponsor believes that the Fund may become a more appealing target of security threats as the size of the Fund s assets grows. To the extent that the Bitcoin Custodian is unable to identify and mitigate or stop new security threats, the Bitcoin Assets may be subject to theft, loss, destruction or other attack, which could have a negative impact on the performance of the Shares. Shareholders may be adversely affected by the lack of independent advisers representing investors in the Fund. The Sponsor has consulted with legal counsel, accountants and other advisers regarding the formation and operation of the Fund. No legal counsel has been appointed to represent an investor in connection with the offering of the Shares. Accordingly, an investor should consult his, her or its own legal, tax and financial advisers regarding the desirability of an investment in the Shares. Lack of such consultation may lead to an undesirable investment decision with respect to investment in the Shares. Shareholders may be adversely affected by lack of regular shareholder meetings and no voting rights. Under the Trust Agreement, Shareholders have limited voting rights and the Fund will not have regular Shareholder meetings and take no part in the management or control of the Fund. Accordingly, Shareholders do not have the right to authorize actions, appoint service providers or take other actions as may be taken by shareholders of other trusts or companies where shares carry such rights. Shareholders may, however, remove and replace the Sponsor by the affirmative vote of a majority of the outstanding Shares. The Shareholders limited voting rights, however, give almost all control under the Trust Agreement to the Sponsor and the Trustee. The Sponsor may take actions in the operation of the Fund that may be adverse to the interests of Shareholders. The Sponsor s operation of the Fund could adversely affect an investment in the Shares. Investment objective and investment strategy Investment Objective The Fund s investment objective is to reflect the price of bitcoin and the value of Carbon Credit Futures, as represented by the 7RCC Kaiko Bitcoin Carbon Credit Index, less expenses from the Fund s operations. There can be no assurance that the Fund will achieve its investment objective or that the Fund s investment strategy will be successful. Principal Investment Strategies The Fund pursues its investment objective by investing 80% of its assets in bitcoin and the remaining 20% of its assets in the Carbon Credit Futures that comprise the Index. The Fund seeks these investments to reflect the price of bitcoin and Carbon Credit Futures, as represented in the Index. The Index seeks to provide exposure to bitcoin with an environmentally responsible approach with exposure to carbon credits, and is designed to track the performance of investing in a portfolio comprised of 80% of bitcoin and 20% Carbon Credit Futures. The Index s Carbon Credit Futures replicate three sub-indexes and provide exposure to the value of emissions allowances issued under the following cap-and-trade regimes: the European Union Carbon Emissions Allowance ("EU ETS"), the California Cap and Trade ("CCA"), and Regional Greenhouse Gas Initiative ("RGGI"). To obtain exposure to the EU ETS, the Index uses Intercontinental Exchange ("ICE") EUA (Carbon Emission Allowances) futures ("EU CEA Carbon Credit Futures"). To obtain exposure to the CCA, the Index uses ICE California Carbon Allowance Vintage Future contracts ("CCA Carbon Credit Futures"). To obtain exposure to the RGGI, the Index uses ICE RGGI (CO2 allowances) futures contracts ("RGGI Carbon Credit Futures"). The Fund s Carbon Credit Futures will not result in any direct participation by the Fund in any particular carbon emissions offsetting project, including any carbon emissions associated with the mining of bitcoin or the Fund s bitcoin holdings. Bitcoin Valuation The value of bitcoin is determined by the value that various market participants place on Bitcoin through their transactions. The most common means of determining the value of a bitcoin is by surveying one or more digital asset trading platforms where bitcoin is traded publicly and transparently. On such digital asset trading platforms, bitcoin is traded with publicly disclosed valuations for each executed trade, measured by one or more fiat currencies such as the U.S. dollar. OTC dealers or market makers do not typically disclose their data. There are numerous digital asset trading platforms operating worldwide, representing a substantial percentage of bitcoin buying and selling activity, and providing the most data with respect to prevailing valuation of bitcoin. The Fund utilizes the same methodology as that of the Index for determining the value of bitcoin for purposes of calculating the NAV of the Fund. The Index requires each digital asset trading platform used to calculate the price of bitcoin to meet each of the following criteria: has had operating history as a crypto asset exchange for a minimum of two years; implemented trading, deposits, and withdrawal fees for a minimum of one month without interruption; met a minimum monthly volume threshold of $30 million with respect to total trading volume; provided reliable, continuous, and valid market data for a minimum of one month; offered the possibility to withdraw and deposit for a minimum of one month, settling in 2-7 business days; chosen a jurisdiction of incorporation that offers sufficient investor protection, such as Financial Action Task Force (FATF), FAFT-style regional bodies (FSRBs), or Moneyval member states; complied with relevant AML and know-your-customer ("KYC") regulations; cooperated with requests from Kaiko and relevant regulatory bodies; has not been domiciled in a jurisdiction subject to EU restrictive measures (sanctions); provided information concerning ownership and corporate structure; and has not been declared unlawful by any governmental authority or agency with jurisdiction over the exchange. Digital asset trading platforms meeting these criteria are used to calculate the price of the bitcoin portion of the Index (the "Index Pricing Sources"). The selection of Index Pricing Sources may evolve from time to time, and Kaiko may make changes to the eligibility requirements. Kaiko reviews the eligibility of digital asset trading platforms for inclusion in the Index two times per year, and such platforms must meet Kaiko s criteria at the time of such review. As of the date of this prospectus, the following platforms are used to calculate the Index price of bitcoin: Bitstamp. Bitstamp, founded in 2011, is a cryptocurrency trading platform headquartered in Luxembourg City, Luxembourg. It allows trading between fiat currencies and cryptocurrencies such as Bitcoin, Ethereum, and others. In April 2016, Bitstamp received a license from the Luxembourg government to operate as a fully regulated payment institution across all 28 EU member states. BTSE: BTSE, established in 2018, is a cryptocurrency trading platform that offers spot and futures trading along with OTC trading and multiple settlement channels. BTSE is capable of 1 million requests per second with self-hosted infrastructure. In 2023, BTSE received an official regulatory registration under the Token and Trustworthy Technology Service Provider Act (TVTG) in Lichtenstein. Coinbase. Coinbase, established in 2012, is a cryptocurrency trading platform based in San Francisco, California, USA. It offers a platform for buying, selling, and storing various cryptocurrencies. Coinbase is registered as a Money Services Business with FinCEN in the United States and complies with applicable state money transmission laws and regulations. In April 2023, Coinbase's Bermuda division was licensed to operate cryptocurrencies in Bermuda. Crypto.com. Crypto.com, founded in 2016, is a cryptocurrency trading platform headquartered in Singapore. It provides a platform for trading, investing, and using cryptocurrencies. In North America, Crypto.com is registered as a Money Services Business with FINTRAC in Canada and FinCEN in the United States. It also holds Money Transmitter Licenses across various U.S. states. In Europe, the company received approval from the UK's Financial Conduct Authority in August 2022 and operates under the Electronic Money Institution license in several European Economic Area countries. EXMO. EXMO, established in 2014, is headquartered in London, UK and has offices in Kyiv, Ukraine. The exchange has a daily trading volume of $60 million with over 1 million KYCed users. The trading platform also offers OTC trading services and an Earn program. EXMO complies with European regulations as a registered provider in Lithuania. Recently, it paused services for UK customers due to new FCA regulations. Gemini. Gemini, established in 2014, is a cryptocurrency trading platform based in New York City, USA. It offers a platform for buying, selling, and storing digital assets. Gemini is regulated by the New York State Department of Financial Services and was the first U.S.-based licensed Ethereum trading platform. In May 2023, Gemini announced that Dublin, Ireland, would be the location for its European headquarters. itBit. itBit, founded in 2013, is a cryptocurrency trading platform headquartered in New York City, USA. It offers trading services for various digital assets. itBit is regulated by the New York State Department of Financial Services and operates under a trust charter, allowing it to offer services across the United States. Kraken. Kraken, established in 2011, is a cryptocurrency trading platform based in San Francisco, California, USA. It provides a platform for trading a wide range of digital assets. In the United States, Kraken is registered as a Money Services Business with FinCEN. In the United Kingdom, Kraken operates as a Financial Conduct Authority (FCA) Registered Cryptoasset Firm under the Money Laundering Regulations. LMAX Digital. LMAX Digital, launched in 2018, is the cryptocurrency arm of LMAX Group, a financial technology company headquartered in London, UK. It offers institutional spot cryptocurrency trading services. LMAX Digital is regulated by the Gibraltar Financial Services Commission as a Distributed Ledger Technology provider for execution and custody services. Kaiko reviews the time-weighted average price from 3:00 pm EST to 4:00 pm ET on all Index Pricing Sources, and values bitcoin as the median price amongst the Index Pricing Sources. The Sponsor believes this methodology provides a reasonable valuation of the spot price of bitcoin that is reasonably resistant to price manipulation of bitcoin. As of December 12, 2024, each Index Pricing Source had the below volume and market share: Index Pricing Source Volume (BTC) Volume (Percentage Market Share) Crypto.com 1,699.56 43.87% Coinbase 1,143.07 29.51% LMAX Digital 440.40 11.38% BTSE 204.04 5.26% Kraken 203.90 5.26% Gemini 87.41 2.25% Bitstamp 86.88 2.24% itBit 5.55 0.14% EXMO 2.80 0.07% Once it has actual knowledge of changes to the Index Pricing Sources used to calculate the Bitcoin Price, the Fund will notify Shareholders in a prospectus supplement and a current report on Form 8-K or in its annual or quarterly reports. The Sponsor, in its sole discretion, may cause the Fund to price its portfolio based upon an index, benchmark or standard other than the Index and the Bitcoin Price at any time, with prior notice to the Shareholders, if investment conditions change or the Sponsor believes that another index, benchmark or standard better aligns with the Fund s investment objective and strategy. The Sponsor may make this decision for a number of reasons, including, but not limited to, a determination that the Bitcoin Price of bitcoin differs materially from the global market price of bitcoin and/or that third parties are able to purchase and sell bitcoin on public or private markets not included among the Index Pricing Sources, and such transactions may take place at prices materially higher or lower than the Bitcoin price. The Sponsor, however, is under no obligation whatsoever to make such changes in any circumstance. In the event that the Sponsor intends to establish the Fund s NAV by reference to an index, benchmark or standard other than the Index, it will provide Shareholders with notice in a prospectus supplement and/or through a current report on Form 8-K or in the Fund s annual or quarterly reports. Purchases and Sales of Bitcoin Because the Fund will conduct creations and redemptions of Shares for cash, it will be responsible for purchasing and selling bitcoin in connection with those creation and redemption orders. The Fund may also be required to sell bitcoin to pay certain extraordinary, non-recurring expenses that are not assumed by the Sponsor. The Sponsor, on behalf of the Fund, will typically seek to buy and sell bitcoin at a price as close to the Bitcoin Price as practical. When choosing between potential counterparties, the Sponsor may consider factors other than simply the most favorable price. However, the most favorable price will be the predominant factor in determining the counterparty with which the Sponsor effectuates the contemplated transaction. Other factors that the Sponsor may consider include the size of the proposed order, as well as a counterparty s execution capabilities, reliability and responsiveness. The Authorized Purchasers will deliver only cash to create Shares and will receive only cash when redeeming Shares. Further, Authorized Purchasers involved in a creation or redemption order will not directly or indirectly purchase, hold, deliver, or receive bitcoin as part of the creation or redemption process or otherwise direct the Fund or a third party with respect to purchasing, holding, delivering, or receiving bitcoin as part of the creation or redemption process for such order. Additionally, the Fund will create Shares by receiving bitcoin from a third party that is not the Authorized Purchaser involved in the order, and the Sponsor, on behalf of the Fund—not the Authorized Purchaser—is responsible for selecting the third party to deliver the bitcoin. Further, the third party will not be acting as an agent of the Authorized Purchaser with respect to the delivery of the bitcoin to the Fund or acting at the direction of the Authorized Purchaser with respect to the delivery of the bitcoin to the Fund. Additionally, the Fund will redeem Shares by delivering bitcoin to a third party that is not the Authorized Purchaser and the Sponsor, on behalf of the Trust—not the Authorized Purchaser—is responsible for selecting the third party to receive the bitcoin. Further, the third party will not be acting as an agent of the Authorized Purchaser with respect to the receipt of the bitcoin from the Fund or acting at the direction of the Authorized Purchaser with respect to the receipt of the bitcoin from the Fund. Bitcoin Trading Counterparties. The Sponsor, on behalf of the Trust, is responsible for acquiring bitcoin from a bitcoin trading counterparty that has been approved by the Sponsor (each, a Bitcoin Trading Counterparty). JSCT, LLC (which is an affiliate of Jane Street Capital, LLC, an Authorized Purchaser for the Fund), DV Chain, LLC and Gemini are currently the Fund s Bitcoin Trading Counterparties. The Bitcoin Trading Counterparties with which the Sponsor will engage in bitcoin transactions are unaffiliated third parties and all transactions will be done on an arm s-length basis. Bitcoin Trading Counterparties are not required to have an account with the Custodians. When seeking to purchase or sell bitcoin on behalf of the Fund, the Sponsor will typically seek to buy and sell bitcoin at a price as close to the Bitcoin Price as practical from any of the approved Bitcoin Trading Counterparties. Upon notification that the Fund needs to purchase or sell bitcoin, the Sponsor will reach out to various Bitcoin Trading Counterparties and ask them for a quote regarding the terms at which they would be willing to execute the contemplated transaction. The Sponsor then determines the Bitcoin Trading Counterparty with which it wishes to transact and records the rationale for that determination. Once agreed upon, the transaction will generally occur on an "over-the-counter" basis. In the event that the Fund engages other Bitcoin Trading Counterparties, transfers of bitcoin may be conducted as "on-chain" transactions represented on the bitcoin Blockchain. The Sponsor maintains a process for approving and monitoring Bitcoin Trading Counterparties. All Bitcoin Trading Counterparties must be approved by the Sponsor before the Fund will engage in transactions with the entity. The Sponsor continuously reviews all approved Bitcoin Trading Counterparties and will reject the approval of any previously approved Bitcoin Trading Counterparty if new information arises regarding the entity that puts the appropriateness of that entity as an approved bitcoin trading counterparty in doubt. The Sponsor has instituted policies and procedures to evaluate which Bitcoin Trading Counterparties to approve. Carbon Credit Futures Futures contracts are standardized contracts that obligate the parties to buy or sell an asset at a predetermined price and date in the future. The Carbon Credit Futures that comprise the sleeve of the Index are linked to the value of emissions allowances issued under the EU ETS, CCA and RGGI include EU CEA Carbon Credit Futures, CCA Carbon Credit Futures and RGGI Carbon Credit Futures. Commodity futures contracts linked to the value of emission allowances are known as "carbon credit futures". The Index is comprised of futures contracts on emissions allowances issued by various "cap-and-trade" regulatory regimes that seek to reduce greenhouse gas emissions over time. A cap-and-trade regime typically involves a regulator setting a limit on the total amount of specific greenhouse gases ("GHG") (such as CO2) that can be emitted by regulated entities. Capping and reducing the cap on GHGs is viewed as a key policy tool in reaching climate change objectives. The regime is designed to promote sustainable development by putting a price on carbon emissions. The regulator will then issue or sell "emissions allowances" to regulated entities, which in turn may buy or sell the emissions allowances to the open market. To the extent that the regulator may then reduce the cap on emission allowances, regulated entities are incentivized to reduce their emissions; otherwise, they must purchase additional emission allowances on the open market, where the price of such allowances will likely be increasing as a result of demand, and regulated entities that reduce their emissions will be able to sell unneeded emission allowances for profit. An emission allowance or carbon credit is a unit of emissions (typically one ton of CO2) that the owner of the allowance or credit is permitted to emit. Futures contracts linked to the value of emission allowances are known as "carbon credit futures". Descriptions of each of the EU ETS, CCA and RGGI are below: EU ETS: EU ETS cap-and-trade regime is a cornerstone of the EU s policy to combat climate change and is a key tool for reducing greenhouse gas emissions cost-effectively. It was the world s first major carbon market and remains among the largest. The EU ETS is a cap & trade mechanism that was launched in 2005 and has become the largest GHG trading mechanism in the world, covering approximately 11,000 installations generating carbon emissions in certain sectors, such as power generation, utilities, iron, steel, and cement. Under the mechanism, each country has a national allocation plan that determines the caps on GHG emissions for each participating entity. Participants are allocated some free European Union Allowances ("EUAs") and may purchase a proportion through auction. Participants have to monitor their emissions and after each year submit EUAs equivalent to their verified emissions. Participants that do not have sufficient EUAs can buy them from other participants that have a surplus, or within certain limits, use other eligible carbon credits for compliance purposes instead of EUAs. EUAs are allocated under the National Allocation Plan of each country within the EU ETS. Each EUA represents one tonne of CO2 or the equivalent amount of nitrous oxide (N2O) and perfluorocarbons (PFCs) ("CO2e"). The EU ETS began with a first Phase running from 2005 to 2007. Phase II of the mechanism is in line with the first Kyoto period and ran from 2008-2012. Phase III ran between 2013 to 2020. Phase IV commenced in 2021 and will run until 2030. Allocations in Phase II were reduced from their respective levels in Phase I to ensure that they were consistent with meeting national Kyoto targets. In Phase III, while some participants were still allocated free allowances, auctioning is the default method for allocating allowances. In addition, EU legislation enables banking of credits between Phases (e.g., from Phase II to Phase III, although this was not possible between Phase I and Phase II). In 2023, the EU adopted and implemented important reforms of the EU ETS framework as part of: the "Fit for 55" package, to align the system with the EU s 2030 climate target of at least 55% net emissions reductions compared to 1990 levels and the European Green Deal objectives, the EU s response to the energy crisis caused by Russia s invasion of Ukraine ("REPowerEU" plan). EUA pricing is set by supply and demand. Supply is determined by EUAs and other carbon credits (CERs, EUAs) which are available to the market. Demand is determined by the volume of carbon emitted during the year in relation to the annual allocation. The main factors influencing volumes emitted in the short-term are the weather, relative fuel prices, general economic activity and the amount of electricity generated from non-fossil fuel sources. The bulk of exchange trading activity in EUAs is concentrated on the ICE Endex Energy exchange ("ICE"). CCA: The CCA cap-and-trade regime is designed to reduce greenhouse gas ("GHG") emissions from major sources (covered entities) by setting a firm cap on statewide GHG emissions while employing market mechanisms to cost-effectively achieve the emission-reduction goals. The statewide cap for GHG emissions from major sources, which is measured in metric tons of carbon dioxide equivalent (MTCO2e), commenced in 2013 and has declined over time, achieving GHG emission reductions throughout the program s duration. Each covered entity will be required to surrender one permit to emit (the majority of which will be allowances, entities are also allowed to use a limited number of ARB offset credits) for each ton of GHG emissions they emit. Certain covered entities will be allocated allowances and will be able to buy additional allowances at auction, purchase allowances from others, or purchase offset credits. Carbon credits issued under the CCA cap-and-trade regime include carbon credits issued by Quebec since the California and Quebec markets were linked pursuant to the Western Climate Initiative in 2014. Currently, carbon credits issued by Quebec each year consist of approximately 17-18% of the carbon credits issued under the CCA cap-and-trade regime. This percentage is subject to change and it is possible for additional markets to be added in the future. RGGI: The RGGI is a cooperative market-based effort among Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island, Vermont and Virginia to cap and reduce CO2 emissions from the power sector. RGGI was the first cap-and-trade regional initiative implemented in the United States. The RGGI is composed of individual CO2 Budget Trading Programs in each participating state. Through independent regulations, based on the RGGI Model Rule, each state's CO2 Budget Trading Program limits emissions of CO2 from electric power plants, issues CO2 allowances and establishes participation in regional CO2 allowance auctions. Within the RGGI states, fossil-fuel-fired electric power generators with a capacity of 25 megawatts1 or greater ("regulated sources") are required to hold allowances equal to their CO2 emissions over a three-year control period. A CO2 allowance represents a limited authorization to emit one short ton of CO2 from a regulated source, as issued by a participating state. Regulated sources can use a CO2 allowance issued by any participating state to demonstrate compliance in any state. They may acquire allowances by purchasing them at regional auctions, or through secondary markets. For 2024, the RGGI cap for the eleven participating states is 157,184,044 CO2 allowances and the adjusted cap is 142,422,869 CO2 allowances. The Fund will invest in the Carbon Credit Futures that comprise the Index. Futures contracts are agreements between two parties that are executed on a designated contract market ("DCM"), i.e., a commodity futures exchange, and that are cleared and margined through a derivatives clearing organization ("DCO"), i.e., a clearing house. The DCMs utilized by the Fund will be Chicago Mercantile Exchange ("CME"), Intercontinental Exchange, Inc. and EUREX. The DCOs utilized by the Fund are CME Clearing, ICE Clear, and LCH Clearnet. The Carbon Credit Futures are financially settled, which means that one party agrees to buy a commodity such as bitcoin from the other party at a later date at a price and quantity agreed upon when the contract is made, but instead of taking physical delivery of the commodity at such later date, settlement occurs in a dollar amount that is equivalent to the amount agreed to in the contract. In market terminology, a party who purchases a futures contract is long in the market and a party who sells a futures contract is short in the market. The contractual obligations of a buyer or seller may generally be satisfied by financial settlement or by making an offsetting sale or purchase of an identical futures contract on the same or linked exchange before the designated date of delivery. The difference between the price at which the futures contract is purchased or sold and the price paid for the offsetting sale or purchase, after allowance for brokerage commissions, constitutes the profit or loss to the trader. If the price of the underlying asset increases after the original futures contract is entered into, the buyer of the futures contract will generally be able to sell a futures contract to close out its original long position at a price higher than that at which the original contract was purchased, generally resulting in a profit to the buyer. Conversely, the seller of a futures contract will generally profit if the price of the underlying asset decreases, as it will generally be able to buy a futures contract to close out its original short position at a price lower than that at which the original contract was sold. Because the Fund seeks to track the Index, the Fund intends to hold only long positions in Carbon Credit Futures and intends to roll its Carbon Credit Futures prior to expiration via sales of existing long positions and the acquisition of new long positions as replacements for contracts sold. Futures contracts are typically traded on futures exchanges (i.e., DCMs) which provide centralized market facilities in which multiple persons may trade contracts. Members of a particular futures exchange and the trades executed on such exchange are subject to the rules of that exchange. Futures exchanges and their related clearing organizations (i.e., DCOs) are given reasonable latitude in promulgating rules and regulations to control and regulate their members. Trades on a futures exchange are generally cleared by the DCO, which provides services designed to mutualize or transfer the credit risk arising from the trading of contracts on an exchange. The clearing organization effectively becomes the other party to the trade, and each clearing member party to the trade looks only to the clearing organization for performance. The Carbon Credit Futures are cash-settled, and the Fund will not be required to take physical delivery. Positions may also be closed out to meet orders for redemption Baskets, in which case the proceeds from closing a particular position or positions will not be reinvested. Position Limits, Accountability Levels, and Dynamic Price Fluctuation Limits may potentially cause a tracking error between the price of the Shares and the Index. The Fund does not intend to limit the size of the offering and will attempt to invest in Carbon Credit Futures and cash and cash equivalents to replicate the exposure of the Index. If the Fund encounters position limits, accountability levels, or price fluctuation limits for Carbon Credit Futures, it could force the Fund to limit the number of Baskets that it sells. Over time, the price of carbon credits fluctuates based on a number of market factors, including demand. The value of Carbon Credit Futures likewise fluctuates in reaction to a number of market factors. Because the Fund seeks to maintain its holdings in Carbon Credit Futures, the Fund must periodically "roll" futures contract positions, closing out soon to expire contracts that will no longer be part of the Index and entering into subsequent to expire contracts. One factor determining the total return from investing in futures contracts is the price relationship between soon to expire contracts and later to expire contracts. If the futures market is in a state of backwardation, the Fund will buy later to expire contracts for a lower price than the sooner to expire contracts that it sells. Hypothetically, and assuming no changes to either the underlying asset or the price relationship between soon to expire contracts and later to expire contracts, the value of a contract will rise as it approaches expiration. Over time, if backwardation remained constant, the differences would continue to increase. If the futures market is in contango, the Fund will buy later to expire contracts for a higher price than the sooner to expire contracts that it sells. Hypothetically, and assuming no other changes to either the underlying asset or the price relationship between the asset, soon to expire contracts and later to expire contracts, the value of a contract will fall as it approaches expiration. Over time, if contango remained constant, the difference would continue to increase. All other things being equal, a situation involving prolonged periods of contango may adversely impact the returns of the Fund; conversely a situation involving prolonged periods of backwardation may positively impact the returns of the Fund. The Fund is required to post margin with respect to its investment in Carbon Credit Futures. "Initial margin" is an amount of funds that must be deposited to initiate an open position in futures contracts. A margin deposit is like a cash performance bond. It helps assure the trader s performance of the futures contracts that he or she purchases or sells. Futures contracts are customarily bought and sold on an initial margin that represents a small percentage of the aggregate purchase or sales price of the contract. The amount of margin required in connection with a particular futures contract is set by the exchange on which the contract is traded. Futures contracts are marked to market at the end of each trading day and the margin required with respect to such contracts is adjusted accordingly. This process of marking to market is designed to prevent losses from accumulating in any futures account. Therefore, if the Fund s futures positions have declined in value, the Fund may be required to post "variation margin" to cover this decline. Alternatively, if the Fund s futures positions have increased in value, this increase will be credited to the Fund s account. The Fund seeks to have the aggregate "notional" amount of the Carbon Credit Futures mirror the exposure of the Index. At any given time, however, most of the Fund s investments with respect to the Carbon Credit Futures are in cash and cash equivalents that support the Fund s position in the Carbon Credit Futures. To secure its position in the Carbon Credit Futures, the Fund will deposit the required margin with the FCM and will separately hold its remaining assets through its Non-Digital Custodian in cash and cash equivalents, which specifically include: (a) cash; (b) debt securities issued or directly or indirectly fully guaranteed or insured by the United States or any agency or instrumentality thereof (such as U.S. Treasury Bills); (c) commercial paper or finance company paper of sufficient credit quality in the view of the Sponsor; or (d) money market mutual funds. Additionally, the Fund will use spot market or foreign exchange forwards and customary foreign exchange hedging instruments to seek to remove its foreign currency exposure. Such remaining assets may be used to meet future margin payments that the Fund is required to make on its Carbon Credit Futures. The Fund earns interest and other income from the cash equivalents that it purchases, and on the cash, it holds through the Non-Digital Custodian or other financial institutions. The earned interest and other income increase the Fund s NAV. The Fund applies the earned interest and other income to the acquisition of additional investments or uses it to pay its expenses. When the Fund reinvests the earned interest and other income, it makes investments that are consistent with its investment objectives. As an example, assume that a Creation Basket is sold by the Fund, and that the Fund s closing NAV per Share is $25.00. In that case, the Fund would receive $25,000 in proceeds from the sale of the Creation Basket ($25.00 NAV per Share multiplied by 10,000 Shares and ignoring the transaction fee of $300). The Sponsor would allocate 80% of the proceeds to bitcoin ($20,000) and 20% to Carbon Credit Futures ($5,000) in proportion to those represented in the Index. Assuming a margin requirement equal to 10% of the value of the Carbon Credit Futures (the amount of margin required for Carbon Credit Futures varies by contract and exchange), the Fund would be required to deposit $500 in cash with the FCM through which the Carbon Credit Futures were purchased. The remainder of the proceeds from the sale of the Creation Basket allocated to the Fund s carbon investments (i.e., 20% of the value of the Creation Basket), $4,500, would remain invested in cash, and/or cash equivalents as determined by the Sponsor from time to time based on factors such as potential calls for margin or anticipated redemptions. The above notwithstanding, the Fund invests in Carbon Credit Futures that comprise each of the Solactive subindices (see below for additional information), in weights reflected by the Index. As of the date of this prospectus, 11% of the Index is comprised of EU CEA Carbon Credit Futures, 8% of the Index is comprised of CCA Carbon Credit Futures that reference CCA and 1% of the Index is comprised of RGGI Carbon Credit Futures. Accordingly, of the $5,000 in proceeds indicated above, $2,750 would be allocated to EU CEA Carbon Credit Futures (of which, assuming a 10% margin requirement, $275 would be deposited in cash with the FCM), $2,000 would be allocated to CCA Carbon Credit Futures (of which, assuming a 10% margin requirement, $200 would be deposited in cash with the FCM) and $250 would be allocated to RGGI Carbon Credit Futures (of which, assuming a 10% margin requirement, $25 would be deposited in cash with the FCM). In the event of a redemption order, the Fund would liquidate the necessary Carbon Credit Futures necessary to cover the portion of the redemption order, and similarly sell the necessary amount of bitcoin, which in aggregate, would cover the funds to meet the redemption request and maintain the 80% / 20% weightings of bitcoin and Carbon Credit Futures represented by the Index. As an example, assume that the Fund receives a redemption request for a Basket and that the Fund s closing NAV per Share is $25.00. The Fund would need to raise $25,000 in cash to meet such redemption request ($25.00 NAV per Share multiplied by 10,000 Shares and ignoring the transaction fee of $300). The Sponsor would instruct the sale of $20,000 worth of bitcoin and $5,000 worth of notional value of the respective Carbon Credit Futures to maintain the appropriate exposure to the Index. The proceeds of such sales would be used for the redemption order. The Index The Index provides exposure to the daily price performance of bitcoin and Carbon Credit Futures by aiming to track the financial performance of investing in a portfolio of 80% bitcoin and 20% Carbon Credit Futures. In providing this exposure, the Index seeks to provide exposure to bitcoin with an environmentally responsible approach through exposure to carbon credits. The Index does not provide exposure to futures contracts that are specifically linked to bitcoin mining or other related processes. Kaiko is the index provider, benchmark administrator and calculates the Bitcoin Price. Kaiko is also the central recipient of input data and evaluates the integrity and accuracy of the input data. Solactive is the calculation agent of the Index and is also the index provider of each of the Sub-indexes detailed below. Bitcoin is valued in accordance with the procedures outlined above in "Investment Objective and Investment Strategy — Principal Investment Strategies — Bitcoin Valuation". The Index is calculated on any day the Exchange is open for trading. The Index value will be calculated as of 4:00 p.m. ET, and published after 4:10 ET on such days. Bitcoin represents 80% of the value of the Index with the remaining 20% represented by various interests in Carbon Credit Futures. The Carbon Credit Futures portion of the Index is built using a combination of three carbon credit indices, each of which is calculated and administered by Solactive: Solactive Future Series European Carbon Credit Rolling Futures Index (the "European Sub-index"), Solactive Future Series California Carbon Rolling Futures Index (the "California Sub-index"), and the Solactive Future Series Regional Greenhouse Gas Rolling Futures Index (the "RGGI Sub-index" and, collectively with the European Sub-index and the California Sub-index, the "Sub-indexes"). The combination of exposure to the three underlying indices provides the Index with returns tied to futures contracts on carbon credits connected to EU ETS, CCA and RGGI. Solactive calculates the value of the Carbon Credit Futures for the Index in accordance with the valuation of the Carbon Credit Futures Sub-indexes, detailed below. The Carbon Credit Futures represented by the European Sub-index are denominated in euros, however the Index is published in U.S. dollars. The European Sub-index employs the 4:00 p.m. London WM/Reuters Fixing to convert the value of the European Sub-index in euros to a value in U.S. dollars. For additional information regarding each of the European Sub-index, California Sub-index and RGGI Sub-index, please see "Carbon Credit Futures Sub-indexes" below). The Sub-indexes include only Carbon Credit Futures that mature in the upcoming December. Specifically, each Sub-index includes front-month futures contracts that are rolled over a five day period prior to the expiration of such contracts in December to new contracts that expire in December of the subsequent year. For example, if the specific Sub-index holds front-month Carbon Credit Futures that expire in December 2025, when such contracts approach their expiration date, the Sub-index will roll such contracts into Carbon Credit Futures that expire in December 2026. The Index does not equally weight its exposure to the Carbon Credit Futures that comprise the Sub-indexes. Rather it seeks exposure to the reference carbon credits proportional to the trading volume of the back-month Carbon Credit Futures over the last 22 trading days prior to the December rebalancing. As of the date of this prospectus, 11% of the Index is comprised of EU CEA Carbon Credit Futures, 8% of the Index is comprised of CCA Carbon Credit Futures that reference CCA and 1% of the Index is comprised of RGGI Carbon Credit Futures. The below table provides the volume and allocation for the specific Carbon Credit Futures on ICE as of December 12, 2024: Carbon Credit Futures Volume Allocation EU CEA Carbon Credit Futures 23,493 11% CCA Carbon Credit Futures 5,129 8% RGGI Carbon Credit Futures 393 1% The Index rebalances quarterly in March, June, September and December. The December rebalance of the Index is the business day immediately following the roll of Carbon Credit Futures for each of the Sub-indexes. Index data and the description of the Index are based on information made publicly available by the Benchmark Administrator. None of the information on the Benchmark Administrator s website is incorporated by reference into this prospectus. The Fund will notify Shareholders of any material change in the methodology of the Index or the respective Sub-indexes in a prospectus supplement and/or a current report on Form 8-K or in its annual or quarterly reports. Carbon Credit Futures Sub-indexes. The Sub-indexes are excess return indexes that roll exposure to the underlying futures contracts over five days. The European Sub-index seeks to track the performance of the Intercontinental Exchange EUA (Carbon Emission Allowances) futures. The California Sub-index seeks to track the performance of the ICE California Carbon Allowance Vintage Future contracts. The RGGI Sub-index seeks to track the performance of the ICE RGGI (CO2 allowances) futures contracts. Each Sub-index has been calculated back to a start date of January 16, 2024 (the "Start Date") and the initial level of each Sub-index on the Start Date was 100. The Sub-indexes are owned, calculated, administrated, and published by Solactive AG assuming the role as index owner and index administrator under the Regulation (EU) 2016/1011. The levels of each Sub-index is calculated on each day on which the ICE Futures U.S. is open for general business (the "Calculation Day") based on the trading prices on the ICE Futures U.S. on which the futures contracts currently reflected in the respective Sub-index (the "Sub-index Components") are listed. The levels for the RGGI Sub-index and California Sub-index are calculated on each Calculation Day from 3:00 to 16:00 ET. A closing level for each of the RGGI Sub-Index and California Sub-index is calculated based on the last trading price of the respective Sub-index Component prior to 16:00 ET. If the trading price to determine the closing level of the respective Sub-index for any of the Sub-index Components is unavailable, the "Settlement Level" (detailed below) of the Sub-index Component published by the respective exchange on which the Sub-index Component is listed will be used. The level for the European Sub-index is calculated on each Calculation Day from 8:00 to 19:00 CET (2:00 to 13:00 ET). A closing level for the European Sub-index for each Calculation Day is calculated based on the Settlement Level of the Sub-index Component. The "Settlement Level" is an underlying security s final regular-hours price at which a futures contract will reference at the end of each Calculation Day and upon its expiration published by the ICE Futures U.S. and determined in accordance with the ICE Futures U.S. regulations. In the event that a Sub-index Component has no closing level or settlement level, such a day will be treated as a market disruption day, and the level of the respective Sub-index will not be published. Sub-index Components are selected according to the Roll Period (defined below) and in accordance with each Sub-index s pre-determined roll schedule (the "Roll Schedule"). The replacement of the current active contract as set forth in the Roll Schedule (the "Active Contract") by the next active contract as set forth in the Roll Schedule (the "Next Active Contract") will be implemented over a five-day roll period (the "Roll Period"). The Roll Period starts on the Trading Day (defined as a day on which the respective Sub-index is open for trading (or a day that would have been such a day if a market disruption had not occurred) (the "Roll Start Date"), excluding days on which trading may be ceased prior to the normal Sub-index closing time) preceding the expiry day of the Active Contract by fifteen Trading Days. The Contract Roll Weight of the Active Contract is then decreased by 1/5 after the close of each Trading Day of the Roll Period starting at 100% while the Contract Roll Weight of the Next Active Contract is increased by 1/5 after the close of each Trading Day of the Roll Period starting at 0%. After the end of the Roll Period (inclusive of the Trading Day which is five days after the Roll Start Date (the "Roll End Date")) the Next Active Contract becomes the Active Contract. Once the expiry date (the "Roll Anchor"), anchort as of Calculation Day t is determined, in relation to Calculation Day t, the Roll Start, RollStartt, is set to negative 15 (the "Roll Offset") plus one Calculation Day before anchort. Roll End, RollEndt, as of Calculation Day t is set to be exactly the number of "Roll Days" many Calculation Days after Roll Start, RollStartt. In relation to Calculation Day t, the Contract Roll Weight of the Active Contract is calculated as follows: # is the number of Calculation Days between Calculation Day t (inclusive) and RollEndt (exclusive) In relation to Calculation Day t_the Contract Roll Weight of the Next Active Contract is calculated as follows: Roll Anchor would be set to the Active Contract s expiration date. Therefore, Roll Start would be the fifteenth last day before expiration. Weekday Mon Tue Wed Thu Fri Mon Tue Wed Thu Fri Named Day Roll Start Roll End Roll Anchor Weight of the Active Contract 100% 100% 100% 80% 60% 40% 20% 0% 0% 0% Weight of the Next Active Contract 0% 0% 0% 20% 40% 60% 80% 100% 100% 100% Each Sub-index is calculated on any given Trading Day t and published in USD in accordance with the following formula: is the Sub-index level on the Trading Day immediately preceding Trading Day t with I star date = is the Contract Roll Weight of the Active Contract, c, on Trading Day t is the Contract Roll Weight of the Next Active Contract, nc, on Trading Day t is the Settlement Level of the Active Contract, c, on Trading Day t is the Settlement Level of the Next Active Contract, nc, on Trading Day t The methodology of each Sub-index is subject to regular review, at least annually. In case a need of a change of the methodology has been identified within such review (e.g., if the underlying market or economic reality has changed since the launch of the respective Sub-index, i.e., if the present methodology is based on obsolete assumptions and factors and no longer reflects the reality as accurately, reliably and appropriately as before), such change will be made in accordance with the Solactive Methodology Policy, which is available on Solactive s website, and published on Solactive s website. OVERVIEW OF THE BITCOIN INDUSTRY AND MARKET This section of the prospectus provides a more detailed description of bitcoin, including information about the historical development of bitcoin, how a person holds bitcoin, how to use bitcoin in transactions, how to trade bitcoin, the "exchange" market where bitcoin can be bought, held and sold, the bitcoin over-the-counter ("OTC") trading market and bitcoin mining. In this prospectus, Bitcoin with an upper-case "B" is used to describe the system as a whole that is involved in maintaining the ledger of bitcoin ownership and facilitating the transfer of bitcoin among parties. When referring to the digital asset within the Bitcoin Network, bitcoin is written with a lower-case "b" (except, of course, at the beginning of sentences or paragraph sections, as below). Bitcoin Bitcoin is the digital asset that is native to, and created and transmitted through the operations of, the peer-to-peer Bitcoin Network, a decentralized network of computers that operates on cryptographic protocols. No single entity owns or operates the Bitcoin Network, the infrastructure of which is collectively maintained by a decentralized user base. The Bitcoin Network allows people to exchange tokens of value, called bitcoin, which are recorded on a public transaction ledger known as the Blockchain. Bitcoin can be used to pay for goods and services, or it can be converted to fiat currencies, such as the U.S. dollar, at rates determined on digital asset trading platforms or in individual end-user-to-end-user transactions under a barter system. Although nascent in use, bitcoin may be used as a medium of exchange, unit of account or store of value. The Bitcoin Network is decentralized and does not require governmental authorities or financial institution intermediaries to create, transmit or determine the value of bitcoin. In addition, no party may easily censor transactions on the Bitcoin Network. As a result, the Bitcoin Network is often referred to as decentralized and censorship resistant. The value of bitcoin is determined by the supply of and demand for bitcoin. New bitcoin are created and rewarded to the parties providing the Bitcoin Network s infrastructure ("miners") in exchange for expending computational power to verify transactions and add them to the Blockchain. The Blockchain is effectively a decentralized database that includes all blocks that have been solved by miners and it is updated to include new blocks as they are solved. Each bitcoin transaction is broadcast to the Bitcoin Network and, when included in a block, recorded in the Blockchain. As each new block records outstanding bitcoin transactions, and outstanding transactions are settled and validated through such recording, the Blockchain represents a complete, transparent and unbroken history of all transactions of the Bitcoin Network. Bitcoin Network Bitcoin was first described in a white paper released in 2008 and published under the pseudonym "Satoshi Nakamoto." The protocol underlying Bitcoin was subsequently released in 2009 as open-source software and currently operates on a worldwide network of computers. The Bitcoin Network and its software have been under active development since that time by a group of computer engineers known as "core developers," each of whom operates under a volunteer basis and without strict hierarchical administration. The Bitcoin Network utilizes a digital asset known as "bitcoin," which can be transferred among parties via the Internet. Unlike other means of electronic payments such as credit card transactions, one of the advantages of bitcoin is that it can be transferred without the use of a central administrator or clearing agency. As a central party is not necessary to administer bitcoin transactions or maintain the bitcoin ledger, the term decentralized is often used in descriptions of bitcoin. Unless it is using a third-party service provider, a party transacting in bitcoin is generally not afforded some of the protections that may be offered by intermediaries. The first step in directly using the Bitcoin Network for transactions is to download specialized software referred to as a "bitcoin wallet." A user s bitcoin wallet can run on a computer or smartphone, and can be used both to send and to receive bitcoin. Within a bitcoin wallet, a user can generate one or more unique "bitcoin addresses," which are conceptually similar to bank account numbers. After establishing a bitcoin address, a user can send or receive bitcoin from his or her bitcoin address to another user s bitcoin address. Sending bitcoin from one bitcoin address to another is similar in concept to sending a bank wire from one person s bank account to another person s bank account; however, such transactions are not managed by an intermediary and erroneous transactions generally may not be reversed or remedied once sent. The amount of bitcoin associated with each bitcoin address, as well as each bitcoin transaction to or from such bitcoin address, is transparently reflected in the Blockchain and can be viewed by websites that operate as "blockchain explorers." Copies of the Blockchain exist on thousands of computers on the Bitcoin Network throughout the Internet. A user s bitcoin wallet will either contain a copy of the blockchain or be able to connect with another computer that holds a copy of the blockchain. The innovative design of the Bitcoin Network protocol allows each bitcoin user to trust that their copy of the Blockchain will generally be updated consistent with each other user s copy. When a bitcoin user wishes to transfer bitcoin to another user, the sender must first request a Bitcoin address from the recipient. The sender then uses his or her Bitcoin wallet software to create a proposed transaction that is confirmed and settled when included in the Blockchain. The transaction would reduce the amount of bitcoin allocated to the sender s bitcoin address and increase the amount allocated to the recipient s bitcoin address, in each case by the amount of bitcoin desired to be transferred. The transaction is completely digital in nature, similar to a file on a computer, and it can be sent to other computers participating in the Bitcoin Network; however, the use of cryptographic verification is believed to prevent the ability to duplicate or counterfeit bitcoin. Bitcoin Protocol The Bitcoin protocol is built using open-source software, meaning any developer can review the underlying code and suggest changes. There is no official company or group that is responsible for making modifications to Bitcoin. There are, however, a number of individual developers that regularly contribute to a specific distribution of Bitcoin software known as the "Bitcoin Core," which is maintained in an open-source repository on the website Github. There are many other compatible versions of Bitcoin software, but Bitcoin Core provides the de-facto standard for the Bitcoin protocol, also known as the "reference software." The core developers for Bitcoin Core operate under a volunteer basis and without strict hierarchical administration. Significant changes to the Bitcoin protocol are typically accomplished through a so-called "Bitcoin Improvement Proposal" or "BIP." Such proposals are generally posted on websites, and the proposals explain technical requirements for the protocol change as well as reasons why the change should be accepted. Upon its inclusion in the most recent version of Bitcoin Core, a new BIP becomes part of the reference software s Bitcoin protocol. Several BIPs have been implemented since 2011 and have provided various new features and scaling improvements. Because Bitcoin has no central authority, updating the reference software s Bitcoin protocol will not immediately change the Bitcoin Network s operations. Instead, the implementation of a change is achieved by users and transaction validators (known as "miners") downloading and running updated versions of Bitcoin Core or other Bitcoin software that abides by the new Bitcoin protocol. Users and miners must accept any changes made to the Bitcoin source code by downloading a version of their Bitcoin software that incorporates the proposed modification of the Bitcoin Network s source code. A modification of the Bitcoin Network s source code is only effective with respect to those bitcoin users and miners who download it. If an incompatible modification is accepted by a less than overwhelming percentage of users and miners, a division in the Bitcoin Network will occur such that one network will run the pre-modification source code and the other network will run the modified source code. Such a division is known as a "fork" in the Bitcoin Network. Such a fork in the Bitcoin Network occurred on August 1, 2017, when a group of developers and miners accepted certain changes to the Bitcoin Network software intended to increase transaction capacity. Blocks mined on this network now diverge from blocks mined on the Bitcoin Network, which has resulted in the creation of a new blockchain whose digital asset is referred to as "bitcoin cash." Bitcoin and Bitcoin Cash now operate as separate, independent networks, and have distinct related assets (bitcoin and bitcoin cash). Additional forks have followed the Bitcoin Cash fork, including those for Bitcoin Gold (October 24, 2017) and Bitcoin SegWit2X (December 28, 2017), in the months after the creation of Bitcoin Cash. It is possible that additional "forks" will occur in the future. Recent developments on the Bitcoin Network has enabled some functionality other than the transfer of value on the Blockchain. Following the recent activation of "Segregated Witness" on the Bitcoin Network, an alpha version of the Lightning Network was released. The "Lightning Network" is an open-source decentralized network that enables instant off-blockchain transfers of the ownership of bitcoin without the need of a trusted third party. In 2021, the Bitcoin protocol implemented the Taproot upgrade to add enhanced support for complex transactions on the network such as multi-signature transactions, which require two or more parties to execute a transaction on the Bitcoin Network. Other efforts include increased use of smart contracts and distributed registers built into, built atop or pegged alongside the Blockchain. The Fund s activities will not directly relate to such projects, though such projects may utilize bitcoin as tokens for the facilitation of their non-financial uses, thereby potentially increasing the utility of the Bitcoin Network as a whole. Conversely, projects that operate and are built within the Blockchain may increase the data flow on the Bitcoin Network and could either "bloat" the size of the Blockchain or slow confirmation times. At this time, such projects remain in early stages. Bitcoin Transactions A bitcoin transaction is similar in concept to an irreversible digital check. The transaction contains the sender s bitcoin address, the recipient s bitcoin address, the amount of bitcoin to be sent, a transaction fee and the sender s digital signature. Bitcoin transactions are secured by cryptography known as public-private key cryptography, represented by the bitcoin addresses and digital signature in a transaction s data file. Each Bitcoin Network address, or "wallet," is associated with a unique "public key" and "private key" pair, both of which are lengthy alphanumeric codes, derived together and possessing a unique relationship. The use of key pairs is a cornerstone of the Bitcoin Network technology. This is because the use of a private key is the only mechanism by which a bitcoin transaction can be signed. If a private key is lost, the corresponding bitcoin is thereafter permanently non-transferable. Moreover, the theft of a private key provides the thief immediate and unfettered access to the corresponding bitcoin. Bitcoin users must therefore understand that in this regard, bitcoin is similar to cash: that is, the person or entity in control of the private key corresponding to a particular quantity of bitcoin has de facto control of the bitcoin. For large quantities of bitcoin, holders often embrace sophisticated security measures. For a discussion of how the Fund secures its bitcoin, see "Custody of the Fund s Assets—The Bitcoin Custodian" below. The public key is visible to the public and analogous to the Bitcoin Network address. The private key is a secret and is used to digitally sign a transaction in a way that proves the transaction has been signed by the holder of the public-private key pair, without having to reveal the private key. A user s private key must be kept safe in accordance with appropriate controls and procedures to ensure it is used only for legitimate and intended transactions. If an unauthorized third person learns of a user s private key, that third person could apply the user s digital signature without authorization and send the user s bitcoin to their or another bitcoin address, thereby stealing the user s bitcoin. Similarly, if a user loses his private key and cannot restore such access (e.g., through a backup), the user may permanently lose access to the bitcoin associated with that private key and bitcoin address. To prevent the possibility of double-spending bitcoin, each validated transaction is recorded, time stamped and publicly displayed in a "block" in the Blockchain, which is publicly available. Thus, the Bitcoin Network provides confirmation against double-spending by memorializing every transaction in the Blockchain, which is publicly accessible and downloaded in part or in whole by all users of the Bitcoin Network software program. Any user may validate, through their Bitcoin wallet or a blockchain explorer, that each transaction in the Bitcoin Network was authorized by the holder of the applicable private key, and Bitcoin Network mining software consistent with reference software requirements validates each such transaction before including it in the Blockchain. This cryptographic security ensures that bitcoin transactions may not generally be counterfeited, although it does not protect against the "real world" theft or coercion of use of a bitcoin user s private key, including the hacking of a bitcoin user s computer or a service provider s systems. A bitcoin transaction between two parties is recorded if such transaction is included in a valid block added to the Blockchain. A block is accepted as valid through consensus formation among Bitcoin Network participants. Validation of a block is achieved by confirming the cryptographic hash value included in the block s data and by the block s addition to the longest confirmed blockchain on the Bitcoin Network. For a transaction, inclusion in a block on the Blockchain constitutes a "confirmation" of validity. As each block contains a reference to the immediately preceding block, additional blocks appended to and incorporated into the Blockchain constitute additional confirmations of the transactions in such prior blocks, and a transaction included in a block for the first time is confirmed once against double-spending. This layered confirmation process makes changing historical blocks (and reversing transactions) exponentially more difficult the further back one goes in the Blockchain. To undo past transactions in a block recorded on the Blockchain, a malicious actor would have to exert tremendous hashrate in re-solving each block in the Blockchain starting with and after the target block and broadcasting all such blocks to the Bitcoin Network. The Bitcoin Network is generally programmed to consider the longest Blockchain containing solved and valid blocks to be the most accurate Blockchain. In order to undo multiple layers of confirmation and alter the Blockchain, a malicious actor must re-solve all of the old blocks sought to be regenerated and be able to continuously add new blocks to the Blockchain at a speed that would have to outpace that of all of the other miners on the Bitcoin Network, who would be continuously solving for and adding new blocks to the Blockchain. If a malicious actor is able to amass ten percent (10%) of the Bitcoin Network s aggregate hashrate, there is estimated to be a 0.1 percent chance that it would be able to overcome six (6) confirmations. Therefore, given the difficulty in amassing such hashrate, six (6) confirmations is an often-cited standard for the validity of transactions. The Fund has adopted a policy whereby a transaction will be deemed confirmed upon this industry standard of six (6) confirmations (the "Confirmation Protocol"). As one (1) block is added to the Blockchain approximately every six (6) to twelve (12) minutes, a Bitcoin transaction will be, on average, confirmed using the Confirmation Protocol beyond a reasonable doubt in approximately one (1) hour. Merchants selling high-value goods and services, as well as Bitcoin Platforms and many experienced users, are believed to generally use the six (6) confirmations standard. This confirmation system, however, does not mean that merchants must always wait for multiple confirmations for transactions involving low-value goods and services. As discussed below, the value of a successful double-spending attack involving a low-value transaction may, and perhaps likely will, be significantly less than the cost involved in arranging and executing such double-spending attacks. Furthermore, merchants engaging in low-value transactions may then view the reward of quicker transaction settlements with limited or no Blockchain confirmation as greater than the related risk of not waiting for six (6) confirmations with respect to low-value transactions at points of sale. Conversely, for high-value transactions that are not time sensitive, additional settlement security can be provided by waiting for more than six (6) confirmations. Bitcoin Mining – Creation of New Bitcoins Mining Process The process by which bitcoin are created and bitcoin transactions are verified is called "mining." To begin mining, a user, or "miner," can download and run a mining "client," which, like regular Bitcoin Network software programs, turns the user s computer into a "node" on the Bitcoin Network that validates blocks, and, in this case, gives such user the ability to validate transactions and add new blocks of transactions to the Blockchain. Miners, through the use of the bitcoin software program, engage in a set of prescribed complex mathematical calculations in order to verify transactions and compete for the right to add a block of verified transactions to the Blockchain and thereby confirm bitcoin transactions included in that block s data. The miner who successfully "solves" the complex mathematical calculations has the right to add a block of transactions to the Blockchain and is then rewarded with new bitcoin, the amount of which is determined by the Bitcoin protocol, plus any transaction fees paid for the transactions included in such block. Confirmed and validated bitcoin transactions are recorded in blocks added to the Blockchain. Each block contains the details of some or all of the most recent transactions that are not memorialized in prior blocks, as well as a record of the award of bitcoin to the miner who added the new block. Each unique block can only be solved and added to the Blockchain by one miner; therefore, all individual miners and mining pools on the Bitcoin Network are engaged in a competitive process of constantly increasing their computing power to improve their likelihood of solving for new blocks. As more miners join the Bitcoin Network and its processing power increases, the Bitcoin Network adjusts the complexity of the block-solving equation to maintain a predetermined pace of adding a new block to the Blockchain approximately every ten minutes. Mathematically Controlled Supply The method for creating new bitcoin is mathematically controlled in a manner so that the supply of bitcoin grows at a limited rate pursuant to a pre-set schedule. The number of bitcoin awarded for solving a new block is automatically halved every 210,000 blocks. Thus, the current fixed reward for solving a new block is 6.25 bitcoin per block; the reward decreased from twenty-five (25) bitcoin in July 2016 and 12.5 in May 2020. The most recent halving occurred in April 2024 and the next estimated halving is expected to occur in 2028. This deliberately controlled rate of bitcoin creation means that the number of bitcoin in existence will never exceed twenty-one million (21,000,000) and that bitcoin cannot be devalued through excessive production unless the Bitcoin Network s source code (and the underlying protocol for bitcoin issuance) is altered. As of November 2024, approximately 19.8 million bitcoin are outstanding. The date when the 21 million bitcoin limitation will be reached is estimated to be the year 2140. Forms of Attack Against the Bitcoin Network All networked systems are vulnerable to various kinds of attacks. As with any computer network, the Bitcoin Network contains certain flaws. For example, the Bitcoin Network is currently vulnerable to a "51% attack" where, if a mining pool were to gain control of more than 50% of the hash rate for a digital asset, a malicious actor would be able to gain full control of the network and the ability to manipulate the Blockchain. In addition, many digital asset networks have been subjected to a number of denial-of-service attacks, which has led to temporary delays in block creation and in the transfer of bitcoin. Any similar attacks on the Bitcoin Network that impact the ability to transfer bitcoin could have a material adverse effect on the price of bitcoin and the value of the Shares. Bitcoin Market and Bitcoin Trading Platforms In addition to using bitcoin to engage in transactions, investors may purchase and sell bitcoin to speculate as to the value of bitcoin in the bitcoin market, or as a long-term investment to diversify their portfolio. The value of bitcoin within the market is determined, in part, by: (i) the supply of and demand for bitcoin in the bitcoin market; (ii) market expectations for the expansion of investor interest in bitcoin and the adoption of bitcoin by individuals; (iii), the number of merchants that accept bitcoin as a form of payment; and (iv) the volume of private end-user-to-end-user transactions. Although the value of bitcoin is determined by the value that two transacting market participants place on bitcoin through their transaction, the most common means of determining a reference value is by surveying one or more trading platforms where secondary markets for bitcoin exist. The most prominent digital asset trading platforms are often referred to as "exchanges," although they neither report trade information nor are they regulated in the same way as a national securities exchange. As such, there is some difference in the form, transparency and reliability of trading data from digital asset trading platforms. Generally speaking, bitcoin data is available from these trading platforms with publicly disclosed valuations for each executed trade, measured by one or more fiat currencies such as the U.S. dollar or Euro or another digital asset such as ether. OTC dealers or market makers do not typically disclose their trade data. Currently, there are many digital asset trading platforms operating worldwide and trading platforms represent a substantial percentage of bitcoin buying and selling activity and, therefore, provide large data sets for market valuation of bitcoin. A digital asset trading platform provides investors with a way to purchase and sell bitcoin, similar to stock exchanges like the New York Stock Exchange or Nasdaq, which provide ways for investors to buy stocks and bonds in the "secondary market." Unlike stock exchanges, which are regulated to monitor securities trading activity, digital asset trading platforms are largely regulated as money services businesses (or a foreign regulatory equivalent) and are required to monitor for and detect money-laundering and other illicit financing activities that may take place on the platform. Digital asset trading platforms operate websites designed to permit investors to open accounts with the trading platform and then purchase and sell bitcoin. As with conventional stock exchanges, an investor opening a trading account and wishing to transact at a digital asset trading platform must deposit an accepted government-issued currency into their account, or a previously acquired digital asset. The process of establishing an account with a digital asset trading platform and trading bitcoin is different from, and should not be confused with, the process of users sending bitcoin from one bitcoin address to another bitcoin address, such as to pay for goods and services. This latter process is an activity that occurs wholly within the confines of the Bitcoin network, while the former is an activity that occurs largely on private websites and databases owned by the digital asset trading platform. Although bitcoin was the first cryptocurrency, since 2009, the number of digital assets, market participants and companies in the space has increased dramatically. In addition to bitcoin, other well-known digital assets include ether, bitcoin cash and litecoin. The digital asset marketplace is still being defined and evolving, including the practices of exchanges, behavior of investors, and the protocols and prominence of particular digital assets. Prior to 2017, bitcoin accounted for approximately 85% or more of the total market capitalization of all digital assets. As of November 2024, bitcoin accounted for approximately 60% of the total market capitalization of all digital assets, according to CoinMarketCap.com. Authorized Purchasers will have the option of purchasing and selling bitcoin used in Creation Basket transactions with the Fund either on bitcoin trading platforms, in the OTC markets or in direct bilateral transactions. OTC trading and direct transactions of bitcoin are generally accomplished via bilateral agreements on a principal-to-principal basis. All risks and issues related to creditworthiness are between the parties directly involved in the transaction. Market Participants Miners Miners range from bitcoin enthusiasts to professional mining operations that design and build dedicated machines and data centers, but the vast majority is now undertaken by parties with access to high grade hardware, favorable electric prices, and industrial data centers. In addition, most mining hashrate is directed by participants in mining pools, which are groups of miners that act cohesively and combine their processing to solve blocks. When a pool adds a new block to the Blockchain, the pool operator receives the new bitcoin and, after taking a nominal fee, splits the resulting reward among the pool participants based on the processing power each of them contributed to solve for such block. Mining pools provide participants with access to smaller, but steadier and more frequent, bitcoin payouts. Investment and Speculative Sector This sector includes the investment and trading activities of both private and professional investors and speculators. These participants range from exchange-traded products, hedge funds and day-traders who invest in bitcoin by trading on digital asset trading platforms. Historically, larger financial services institutions are publicly reported to have limited involvement in investment and trading in digital assets, although the participation landscape is beginning to change and large corporations, financial institutions and investment firms are taking positions providing exposure to bitcoin and other digital assets. Retail Sector The retail sector includes users transacting in direct peer-to-peer Bitcoin transactions through the direct sending of bitcoin over the Bitcoin Network. The retail sector also includes transactions in which consumers pay for goods or services from commercial or service businesses through direct transactions or third-party service providers, such as BitPay, which provides a merchant platform for instantaneous transactions whereby the consumer sends bitcoin to BitPay, which then provides either the bitcoin or the cash value thereof to the commercial or service business utilizing the platform. PayPal, Square and Shopify are examples of traditional merchant payment processors or merchant platforms that have also added Bitcoin payment options for their merchant customers. Payment processing through the Bitcoin Network may reduce the transaction cost for merchants, relative to the costs paid for credit card transaction processing, and eliminates the potential for consumer chargebacks. Service Sector This sector includes companies that provide a variety of services including the buying, selling, payment processing and storing of bitcoin. Coinbase and Fidelity are examples of multi-service financial institutions that provide wallets that store bitcoin for users and also serve as a retail or exchange gateway whereby users can purchase bitcoin for fiat currency. BitPay is an example of Bitcoin payment processors that allow merchants to accept bitcoin as payment. As the Bitcoin Network continues to grow in acceptance, it is anticipated that service providers will expand the currently available range of services and that additional parties will enter the service sector for the Bitcoin Network. Competition More than 20,000 other digital assets have been developed since the inception of Bitcoin, currently the most developed digital asset because of the length of time it has been in existence, the investment in the infrastructure that supports it, and the network of individuals and entities that are using Bitcoin. Some industry groups are also creating private, permissioned blockchains that may or may not feature cryptocurrencies or other digital assets. In addition, private enterprises and governments are exploring the use of stablecoins including central bank digital currencies. Regulation of Bitcoin As bitcoin and digital assets have grown in both popularity and market size, the U.S. Congress and a number of U.S. federal and state agencies (including Financial Crimes Enforcement Network ("FinCen"), SEC, OCC, CFTC, FINRA, the Consumer Financial Protection Bureau ("CFPB"), the Department of Justice, the Department of Homeland Security, the Federal Bureau of Investigation, the IRS, state financial institution regulators, and others) have been examining the operations of digital asset networks, digital asset users and the digital asset exchange market. Many of these state and federal agencies have brought enforcement actions and issued advisories and rules relating to digital asset markets. Ongoing and future regulatory actions with respect to digital assets generally or any single digital asset in particular may alter, perhaps to a materially adverse extent, the nature of an investment in the Shares and/or the ability of the Fund to continue to operate. For example, the events of 2022, including among others the bankruptcy filings of FTX and its subsidiaries, Three Arrows Capital, Celsius Network, Voyager Digital, Genesis, BlockFi and others, and other developments in the digital asset markets, have resulted in calls for heightened scrutiny and regulation of the digital asset industry, with a specific focus on intermediaries such as digital asset exchanges, platforms, and custodians. Federal and state legislatures and regulatory agencies may introduce and enact new laws and regulations to regulate crypto asset intermediaries, such as digital asset exchanges and custodians. The March 2023 collapses of Silicon Valley Bank, Silvergate Bank, and Signature Bank, which in some cases provided services to the digital assets industry, or similar future events, may amplify and/or accelerate these trends. On January 3, 2023, the federal banking agencies issued a joint statement on crypto-asset risks to banking organizations following events which exposed vulnerabilities in the crypto-asset sector, including the risk of fraud and scams, legal uncertainties, significant volatility, and contagion risk. Although banking organizations are not prohibited from crypto-asset related activities, the agencies have expressed significant safety and soundness concerns with business models that are concentrated in crypto-asset related activities or have concentrated exposures to the crypto-asset sector. U.S. federal and state regulators, as well as the White House, have issued reports and releases concerning digital assets, including Bitcoin and digital asset markets. Further, in 2023 the House of Representatives formed two new subcommittees: the Digital Assets, Financial Technology and Inclusion Subcommittee and the Commodity Markets, Digital Assets, and Rural Development Subcommittee, each of which were formed in part to analyze issues concerning crypto assets and demonstrate a legislative intent to develop and consider the adoption of federal legislation designed to address the perceived need for regulation of and concerns surrounding the digital asset industry. However, the extent and content of any forthcoming laws and regulations are not yet ascertainable with certainty, and it may not be ascertainable in the near future. A divided Congress makes any prediction difficult. In August 2021, Gary Gensler, the chair of the SEC, stated that he believed investors using digital asset trading platforms are not adequately protected, and that activities on the platforms can implicate the securities laws, commodities laws and banking laws, raising a number of issues related to protecting investors and consumers, guarding against illicit activity, and ensuring financial stability. The chair expressed a need for the SEC to have additional authorities to prevent transactions, products, and platforms from "falling between regulatory cracks," as well as for more resources to protect investors in "this growing and volatile sector." The chair called for federal legislation centering on digital asset trading, lending, and decentralized finance platforms, seeking "additional plenary authority" to write rules for digital asset trading and lending. It is not possible to predict whether Congress will grant additional authorities to the SEC or other regulators, what the nature of such additional authorities might be, how they might impact the ability of digital asset markets to function or how any new regulations that may flow from such authorities might impact the value of digital assets generally and bitcoin held by the Fund specifically. The consequences of increased federal regulation of digital assets and digital asset activities could have a material adverse effect on the Fund and the Shares. In June 2023, the SEC filed lawsuits against Coinbase and Binance, two large U.S. digital asset trading platforms, alleging that Coinbase and Binance had been operating as unregistered securities exchanges, brokers and clearing agencies in violation of U.S. federal securities laws. While the SEC has not alleged that bitcoin is a security, the outcome of these enforcement actions and others may result in the substantial restructuring of the digital asset market in the United States. However, the SEC has recently faced setbacks in U.S. courts in its attempt to regulate the digital asset markets. In July 2023, the U.S. District Court for the Southern District of New York ruled on the SEC s action against Ripple Labs, Inc. The court found that offers and sales of XRP, a digital token, to institutions and sophisticated individuals constituted securities transactions, but that offers and sales of XRP on crypto exchanges, distributions to employees, and other third-party developers were not securities transactions. More recently, the D.C. Circuit Court found that the SEC s denial of the Grayscale Bitcoin Trust s listing was "arbitrary and capricious" under the Administrative Procedures Act in light of the SEC s approval of two similar bitcoin futures-based ETPs. Nonetheless, until the SEC s numerous actions against digital asset market participants are resolved, the structure of the digital asset market in the United States will remain subject to substantial regulatory risk, which may impact the demand for digital assets and the continued availability of existing exchanges and offerings. FinCEN requires any administrator or exchanger of convertible digital assets to register with FinCEN as a money transmitter and comply with the AML regulations applicable to money transmitters. In 2015, FinCEN assessed a $700,000 fine against a sponsor of a digital asset for violating several requirements of the Bank Secrecy Act by acting as a money services business and selling the digital asset without registering with FinCEN, and by failing to implement and maintain an adequate AML program. In 2017, FinCEN assessed a $110 million fine against BTC-e, a now defunct digital asset exchange, for similar violations. The requirement that exchangers that do business in the U.S. register with FinCEN and comply with AML regulations may increase the cost of buying and selling bitcoin and therefore may adversely affect the price of bitcoin and an investment in the Shares. In a March 2018 letter from FinCEN s assistant secretary for legislative affairs to U.S. Senator Ron Wyden, the assistant secretary indicated that under current law both the developers and the exchanges involved in the sale of tokens in an initial coin offering ("ICO") may be required to register with FinCEN as money transmitters and comply with the AML regulations applicable to money transmitters. The Office of Foreign Assets Control ("OFAC") of the U.S. Department of the Treasury (the "U.S. Treasury Department") has added digital currency addresses, including addresses on the Bitcoin Network to the list of Specially Designated Nationals whose assets are blocked, and with whom U.S. persons are generally prohibited from dealing. Such actions by OFAC, or by similar organizations in other jurisdictions, may introduce uncertainty in the market as to whether bitcoin that has been associated with such addresses in the past can be easily sold. This "tainted" bitcoin may trade at a substantial discount to untainted bitcoin. Reduced fungibility in the Bitcoin markets may reduce the liquidity of bitcoin and therefore adversely affect their price. Under regulations from the New York State Department of Financial Services ("NYDFS"), businesses involved in digital asset business activity for third parties in or involving New York, excluding merchants and consumers, must apply for a license, commonly known as a BitLicense, from the NYDFS and must comply with AML, cyber security, consumer protection, and financial and reporting requirements, among others. As an alternative to a BitLicense, a firm can apply for a charter to become a limited purpose trust company under New York law qualified to engage in digital asset business activity. Other states have considered or approved digital asset business activity statutes or rules, passing, for example, regulations or guidance indicating that certain digital asset business activities constitute money transmission requiring licensure. The inconsistency in applying money transmitting licensure requirements to certain businesses may make it more difficult for these businesses to provide services, which may affect consumer adoption of bitcoin and its price. In an attempt to address these issues, the Uniform Law Commission passed a model law in July 2017, the Uniform Regulation of Virtual Currency Businesses Act, which has many similarities to the BitLicense and features a multi-state reciprocity licensure feature, wherein a business licensed in one state could apply for accelerated licensure procedures in other states. It is still unclear, however, how many states, if any, will adopt some or all of the model legislation. In addition, the SEC, U.S. state securities regulators and several foreign governments have issued warnings that digital assets sold in ICOs may be classified as securities and that both those digital assets and ICOs may be subject to securities regulations. Generally speaking, ICOs are offered and conducted on the Ethereum network or similar "smart contract" platforms, rather than the Bitcoin Network; however, bitcoin has been used for consideration in ICOs on multiple networks and ICOs may be conducted using the Bitcoin Network. On-going and future regulatory actions may alter, perhaps to a materially adverse extent, the nature of an investment in the Shares or the ability of the Fund to continue to operate. Additionally, U.S. state and federal, and foreign regulators and legislatures have taken action against digital asset businesses or enacted restrictive regimes in response to adverse publicity arising from hacks, consumer harm, or criminal activity stemming from digital asset activity. In July 2019, U.S. Treasury Secretary Steven Mnuchin stated that he had "very serious concerns" about digital assets. Secretary Mnuchin indicated that one source of concern is digital assets potential to be used to fund illicit activities. In June 2020, digital asset businesses that are financial institutions were required to comply with the "travel rule" guidelines promoted by the Financial Action Task Force and adopted by government regulators in a substantial number of developed economies. The travel rule requires financial institutions to pass on certain transaction information in connection with financial transfers of size; because of the nature of the Bitcoin Network, compliance with this mandate represents a challenge for digital asset businesses including digital asset trading platforms. Various foreign jurisdictions have, and may continue to, in the near future, adopt laws, regulations or directives that affect the Bitcoin Network, the bitcoin markets, and their users, particularly digital asset trading platforms and service providers that fall within such jurisdictions regulatory scope. For example, on March 5, 2020, South Korea voted to amend its Financial Information Act to require virtual asset service providers to register and comply with its AML and CFT framework. These measures also provide the government with the authority to close digital asset trading platforms that do not comply with specified processes. The Chinese and South Korean governments have also banned ICOs and there have been consistent reports over the course of the last five years that Chinese regulators have taken formal or informal action to shut down or limit banking access to a number of China-based digital asset trading platforms. For example, on January 19, 2018, a Chinese news organization reported that the People s Bank of China had ordered financial institutions to stop providing banking or funding to "any activity related to cryptocurrencies." Similarly, in April 2018, the Reserve Bank of India banned the entities it regulates from providing services to any individuals or business entities dealing with or settling digital assets. On March 5, 2020, this ban was overturned in the Indian Supreme Court, although the Reserve Bank of India is currently challenging this ruling. There remains significant uncertainty regarding the South Korean, Indian and Chinese governments future actions with respect to the regulation of digital assets and digital asset trading platforms. Such laws, regulations or directives may conflict with those of the United States and may negatively impact the acceptance of bitcoin by users, merchants and service providers outside the United States and may therefore impede the growth or sustainability of the bitcoin economy in the European Union, China, South Korea, India and the United States and globally, or otherwise negatively affect the value of bitcoin. In July 2019, the United Kingdom s Financial Conduct Authority proposed rules to address harm to retail consumers deriving from the sale of derivatives and exchange traded notes that reference certain types of digital assets, contending that they are "ill-suited" to retail investors citing extreme volatility, valuation challenges and association with financial crime. In addition to exchange traded notes, the proposed ban would affect financial products including contracts for difference, options and futures. Public consultation on the proposed restriction closed in October 2019. As of the date of this Prospectus, the Financial Conduct Authority has not yet finalized its proposed ruling. The transparency of blockchains has in the past facilitated investigations by law enforcement agencies. However, certain privacy-enhancing features have been or are expected to be introduced to a number of digital asset networks, and these features may provide law enforcement agencies with less visibility into transaction histories. Although no regulatory action has been taken to treat privacy-enhancing digital assets differently, this may change in the future. The effect of any future regulatory change on the Fund or Bitcoin is impossible to predict, but such change could be substantial and adverse to the Fund and the value of the Shares. Bitcoin Value The value of bitcoin is determined by the value that various market participants place on Bitcoin through their transactions. The most common means of determining the value of a bitcoin is by surveying one or more Bitcoin Platforms where bitcoin is traded publicly and transparently (e.g., Coinbase, Bitstamp, Kraken, itBit, LMAX Digital and Gemini). On exchanges, bitcoin is traded with publicly disclosed valuations for each executed trade, measured by one or more fiat currencies such as the U.S. dollar or Euro. OTC dealers or market makers do not typically disclose their trade data. Currently, there are many digital asset exchanges operating worldwide, representing a substantial percentage of bitcoin buying and selling activity, and providing the most data with respect to prevailing valuations of bitcoin. Historically, a large percentage of the global Bitcoin trading volume occurred on self-reported, unregulated Bitcoin Platforms located in China. Throughout 2017, however, the Chinese government took several steps to tighten controls on Bitcoin Platforms, culminating in a ban on domestic cryptocurrency exchanges in November 2017, which forced such exchanges to cease their operations or relocate. As a result, reported bitcoin trading volume on Chinese exchanges is now substantially lower, representing a de minimis share of the global trade volume. From time to time, there may be intra-day price fluctuations across Bitcoin Platforms. However, they are generally relatively immaterial. For example, the variance of prices on Bitcoin Platforms with the highest transaction volumes on average is lower than 2%. These variances usually stem from small changes in the fee structures on different Bitcoin Platforms or differences in administrative procedures required to deposit and withdraw fiat currency in exchange for Bitcoins and vice versa. The greatest variances are found at (i) smaller exchanges with relatively low transaction volumes where even small trades can be large relative to an exchange s transaction volume and as a result impact the trading price on those exchanges and (ii) exchanges that are inaccessible to the Fund because they do not meet the Fund s regulatory requirements, and as a result are accessed and used by a captured market or by parties that do not have regulatory or compliance requirements. Historically, the Fund has not needed to make any changes in the determination of principal market due to variances in pricing, although it has changed its principal market due to disruption of operations of the Bitcoin Market considered to be the principal market. OVERVIEW OF COMMODITY Futures MARKETS and carbon markets This section of the Prospectus provides a descriptive overview of the commodity futures markets, including the market for Carbon Credit Futures. The overview briefly covers commodity futures and the regulatory scheme pursuant to which the Fund and commodity interests markets generally operate. The following description is a summary only; it is not intended to be complete. Regulatory Framework In the U.S., the purchase, sale, trade and/or marketing of interests in commodities, such as futures contracts and swap agreements, is regulated by the CEA, as modified by the Dodd-Frank Act, as well as the rules and regulations promulgated by the CFTC. The CEA establishes the statutory framework under which the CFTC operates and grants the CFTC jurisdiction over exchange traded commodities (e.g., futures and options), over-the-counter markets (e.g., swaps), as well as physical commodity transactions in interstate commerce. The CEA defines a commodity by referencing specific enumerated commodities, as well as "all services, rights, and interests . . . in which contracts for future delivery are presently or in the future dealt in." The CFTC has taken the view that certain digital assets, such as bitcoin are commodities. Through clarifications in the CFTC federal register, renewable energy credits have been deemed to be an environmental commodity, which has subsequently been expanded to include carbon credits as an environmental commodity. In 2008, the Dodd-Frank Act amended the CEA and established a comprehensive new framework for commodities that are purchased, sold, traded and/or marketed using an agreement commonly known as a "swap." Following the enactment of the Dodd-Frank Act, the CFTC was required to create, or promulgate, a multitude of rules and regulations to enforce such laws. The term "swap" includes "any agreement, contract, or transaction…that provides for any purchase, sale, payment, or delivery (other than a dividend on an equity security) that is dependent on the occurrence, nonoccurrence, or the extent of the occurrence of an event or contingency associated with a potential financial, economic, or commercial consequence." The CEA also provides a list of agreements that are also considered swaps, which includes "agreements, contracts and transactions commonly known as … (xx) agriculture swaps, (xxi) emissions swaps, and (xxii) commodity swaps." The Dodd-Frank Act provides that the CFTC shall further define the term swap and the CFTC is given authority over swaps. The CFTC possesses exclusive jurisdiction to regulate the activities of CPOs and CTAs with respect to "commodity interests," such as futures, swaps and options, and has adopted regulations with respect to the activities of those persons and/or entities. Pursuant to authority in the CEA, the NFA has been formed and registered with the CFTC as a registered futures association. At the present time, the NFA is the only self-regulatory organization for commodity interest professionals, other than DCMs. The CFTC has delegated to the NFA responsibility for the registration of CPOs, CTAs and FCMs and their respective associated persons. Under the CEA, a registered CPO, such as the Sponsor, is required to make annual filings with the CFTC and NFA describing its organization, capital structure, management and controlling persons. In addition, the CEA authorizes the CFTC to require and review books and records of, and documents prepared by, registered CPOs. Accordingly, CPOs are required to keep accurate, current and orderly records for each pool that they operate. Suspension, restriction or termination of the Sponsor s registration as a CPO would prevent it, until that registration were to be reinstated, from managing the Fund, and might result in the termination of the Fund if a successor sponsor were not elected pursuant to the Trust Agreement. The regulation of commodity interest transactions in the U.S. is an evolving area of law and is subject to ongoing modification by governmental and judicial action. Considerable regulatory attention has been focused on non-traditional investment pools that are publicly distributed in the U.S. There is a possibility of future regulatory changes within the U.S. altering, perhaps to a material extent, the nature of an investment in the Fund, or the ability of the Fund to continue to implement its investment strategy. The effect of any future regulatory change on the Fund is impossible to predict but could be substantial and adverse. The Fund will use a portion of its net assets to invest in and trade in Carbon Credit Futures; accordingly the Fund is a commodity pool and the Sponsor is a CPO subject to regulation by the CFTC and the NFA under the CEA. The offering of the Fund s Shares is registered with the SEC in accordance with the Securities Act and the Fund s Shares are registered with the SEC under the Exchange Act. Commodity Pools A commodity pool is any investment trust, syndicate, or similar form of enterprise operated for the purpose of trading in commodity interests. In relevant part, a commodity interest is a commodity for future delivery, security futures product, swap or commodity option. Since the Fund intends to use pooled funds from investors to invest in bitcoin and Carbon Credit Futures, the Fund is a "commodity pool" and is therefore subject to CFTC regulation. The term "commodity pool operator" is defined in part as "any person engaged in a business that is of the nature of a commodity pool…and who, in connection therewith, solicits, accepts, or received from others, funds, securities or otherwise, for the purpose of trading in commodity interests…". A "commodity pool operator" is required to register with the CFTC and become a member of the NFA. The Sponsor is a CPO and CTA and is registered with the CFTC and is a member of the NFA. Futures Contracts The Fund invests in Carbon Credit Futures that comprise the Index, specifically contracts that are linked to the value of emissions allowances issued under the following cap-and-trade regimes: EU ETS. CCA and RGGI. The Fund does not invest in any carbon credit futures contracts that are specifically linked to bitcoin mining or other related processes. A futures contract is a standardized contract traded on, or subject to the rules of, an exchange that calls for the future delivery of a specified quantity and type of a particular underlying asset at a specified time and place or alternatively may call for cash settlement. Futures contracts are traded on a wide variety of underlying assets, including bonds, interest rates, agricultural products, stock indexes, currencies, energy, metals, economic indicators and statistical measures. The notional size and calendar term futures contracts on a particular underlying asset are identical and are not subject to any negotiation, other than with respect to price and the number of contracts traded between the buyer and seller. Certain futures contracts settle in cash. The cash settlement amount reflects the difference between the contract purchase/sale price and the contract settlement price. The cash settlement mechanism avoids the potential for either side to have to deliver the underlying asset. For other futures contracts, the contractual obligations of a buyer or seller may generally be satisfied by taking or making physical delivery of the underlying asset or by making an offsetting sale or purchase of an identical futures contract on the same or linked exchange before the designated date of delivery. The difference between the price at which the futures contract is purchased or sold and the price paid for the offsetting sale or purchase, after allowance for brokerage commissions and exchange fees, constitutes the profit or loss to the trader. Futures contracts involve, to varying degrees, elements of market risk. Additional risks associated with the use of futures contracts are imperfect correlation between movements in the price of the futures contracts and the level of the underlying benchmark and the possibility of an illiquid market for a futures contract. With futures contracts, there is minimal but some counterparty risk to a fund since futures contracts are exchange traded and the exchange s clearing house, as counterparty to all exchange-traded futures contracts, effectively guarantees futures contracts against default. Many futures exchanges and boards of trade limit the amount of fluctuation permitted in futures contract prices during a single trading day. Once the daily limit has been reached in a particular contract, no trades may be made that day at a price beyond that limit or trading may be suspended for specified times during the trading day. Futures contracts prices could move to the limit for several consecutive trading days with little or no trading, thereby preventing prompt liquidation of futures positions. Margin Requirements "Initial" or "original" margin is the minimum amount of funds that a counterparty to a futures contract (or cleared derivatives contract) must deposit with their commodity broker in order to establish an open position. "Maintenance" or "variation" margin is the amount (generally less than initial margin) to which a trader s account may decline before he must deliver additional margin so as to maintain open positions. A margin deposit is like a cash performance bond. It helps assure the futures trader s performance of the futures contracts he purchases or sells. Brokerage firms may require higher amounts of margin versus that required by exchanges as a matter of policy in order to afford further protection for themselves. Margin requirements are computed each day by a commodity broker and the relevant exchange. At the close of each trading day, each open futures contract is marked to market, that is, the gain or loss on the position is calculated from the prior day s close. When the market value of a particular open futures contract position changes to a point where the margin on deposit does not satisfy maintenance margin requirements, a margin call is made by the commodity broker. If the margin call is not met within a reasonable time, the broker may close out the customer s position. Carbon Markets Carbon markets are designed to reduce greenhouse gas ("GHG") emissions and promote sustainable development by putting a price on carbon. Carbon markets are markets where GHG emissions are commodified as a tradable unit either as an emission allowance in government compliance markets or as a verified emission reduction/removal credit in voluntary markets. There are two types of instruments that are traded in carbon markets: carbon credits (sometimes called "Allowances") and carbon offsets. The two main types of carbon markets are compliance carbon markets ("CCMs") and voluntary carbon markets ("VCMs"). Carbon Credit Futures are an expansion of the carbon market. Carbon Credit Futures are credit instruments where the buyer seeks to have exposure to CCMs or VCM market s carbon offset projects, but without directly buying or selling allowances or investing in any projects. CCMs are established by governments and operate under a cap-and-trade system. Cap-and-trade regimes set emission limits (i.e., the right to emit a certain quantity of GHG emissions), which can be allocated or auctioned to the parties in the mechanism up to the total emissions cap. In these types of markets, a regulator will define an allowed maximum level of GHG emissions (the "Cap") for a certain group of entities (e.g., countries, companies, or facilities). The Cap is then subdivided into distinct emission allowances, which are distributed by regulated entities. To stay in compliance with the regulator, the covered entities need to submit one allowance for each ton of carbon dioxide equivalent emitted during a compliance period (usually a year). The initial allocation of allowances to covered entities can be free of charge, partially free, and/or sold at auction by the regulator. Cap-and-trade regimes and related markets are new and based on scientific principles that are subject to debate. Cap-and-trade regimes have arisen primarily due to relative international consensus with respect to scientific evidence indicating a correlative relationship between the rise in global temperatures and extreme weather events, on the one hand, and the rise in GHG emissions in the atmosphere, on the other hand. If this consensus were to break down, cap-and-trade regimes and the value of the Fund may be negatively affected. Scientists are still debating whether the rise in atmospheric GHGs is caused by human activity such as GHG emissions generated through the burning of fossil fuels, as well as the acceptable level of GHG concentrations in the atmosphere. If the science supporting the relationship or the acceptable level of GHG concentrations is discredited or proved to be incorrect or inaccurate, it may negatively affect cap-and-trade regimes and the value of the Fund. There is no assurance that cap-and-trade regimes will continue to exist. Cap-and-trade may not prove to be an effective method of reduction in GHG emissions. As a result or due to other factors, cap-and-trade regimes may be terminated or may not be renewed upon their expiration. New technologies may arise that may diminish or eliminate the need for cap-and-trade markets. Ultimately, the cost of emissions credits is determined by the cost of actually reducing emissions levels. If the price of credits becomes too high, it will be more economical for companies to develop or invest in green technologies, thereby suppressing the demand for credits and adversely affecting the price of the Fund. Emission limit allocations may be larger or smaller than is needed for a stable price of credits and can lead to large price volatility, which could affect the value of the Fund. Depending upon the industries covered under each cap-and-trade mechanism represented in the Index, unpredictable demand for their products and services can affect the value of GHG emissions credits. For example, very mild winters or very cool summers can decrease demand for electric utilities and therefore require fewer carbon credits to offset reduced production and GHG emissions. The ability of the GHG emitting companies to pass on the cost of emissions credits to consumers can affect the price of the Carbon Credit Futures. If the price of emissions can be passed on to the end customer with little impact upon consumer demand, it is likely that industries may continue emitting and purchase any shortfall in the market at the prevailing price. If, however, the producer is unable to pass on the cost, it may be incentivized to reduce production in order to decrease its need for offsetting emissions credits, which could adversely affect the price of carbon credit futures and the Fund. Regulatory risk related to changes in regulation and enforcement of cap-and-trade regimes could also adversely affect market behavior. If fines or other penalties for non-compliance are not enforced, incentives to purchase GHG credits will deteriorate, which could result in a decline in the price of emissions credits and a drop in the value of the Fund. In addition, as cap-and-trade markets develop, new regulation with respect to these markets may arise, which could have a negative effect on the value and liquidity of the cap-and-trade markets and the Fund. In the VCM, often referred to as a "baseline-and-credit" system, a variety of private organizations allows individuals or businesses to purchase offsets from emission reduction or removal projects. In these markets, the private organization defines how emission (reduction or removal) credits can be generated by activities/projects that reduce or remove GHG emissions from the atmosphere compared to a reference scenario (baseline) that reflects the counterfactual situation without such activities. The difference between the baseline emissions and the emissions of the activity determines how many credits can be issued. To generate emission credits, verification of the reduction/removal by an officially recognized institution (a verifier) is necessary to calculate the reduction/removal of emissions into its carbon-dioxide ("CO2") equivalent ("CO2e"). The carbon credit represents one metric-ton of CO2e and can then be used as offsets against mandatory or voluntary GHG emission targets or other policy instruments aiming at GHG mitigation. The Fund will not invest in any Carbon Credit Futures that provide exposure to VCMs. Description of the index The following is a summary of the 7RCC Kaiko Bitcoin Carbon Credit Index. The Index aims to track the financial performance of investing in a portfolio with an 80% allocation to bitcoin and a 20% allocation to Carbon Credit Futures. The purpose of the Index is to obtain exposure to bitcoin for environmentally-focused investors. The Carbon Credit Futures component of the Index is built with a combination of three carbon credit indices: (i) Solactive Future Series European Carbon Credit Rolling Futures Index, which tracks Intercontinental Exchange ("ICE") EUA (Carbon Emission Allowances) futures; (ii) Solactive Future Series California Carbon Rolling Futures Index, which tracks ICE California Carbon Allowance Vintage Future contracts; and (iii) Solactive Futures Series Regional Greenhouse Gas Rolling Futures Index, which tracks ICE RGGI (CO2 allowances) futures contracts. For additional information regarding the Sub-Indexes, see "Investment Objective and Investment Strategy—Principal Investment Strategies—the Index—Carbon Credit Futures Sub-indexes" on page [ ]. The Sub-indexes include only Carbon Credit Futures that mature in the upcoming December. Specifically, each Sub-index includes front-month futures contracts that are rolled over a five-day period prior to the expiration of such contracts in December to new contracts that expire in the December of the subsequent year. The Index does not equally weight its exposure to the Carbon Credit Futures that comprise the Sub-indexes. Rather the Index provides exposure to the reference carbon credits proportional to the trading volume of the back-month Carbon Credit Futures over the last 22 trading days prior to the December rebalancing. As of the date of this prospectus, 11% of the Index is comprised of EU CEA Carbon Credit Futures, 8% of the Index is comprised of CCA Carbon Credit Futures that reference CCA and 1% of the Index is comprised of RGGI Carbon Credit Futures. The Index rebalances quarterly in March, June, September and December. The December rebalance of the Index is the business day immediately following the roll of Carbon Credit Futures for each of the Sub-indexes. Kaiko is the index provider, benchmark administrator and calculates the Bitcoin Price. Kaiko is also the central recipient of input data and evaluates the integrity and accuracy of the input data. Kaiko, founded 2014, is a global crypto data and data solutions company, offering businesses institutional-grade, regulatory-compliant solutions. Kaiko, through Kaiko Indices, a wholly owned subsidiary, is an index provider for crypto assets. Kaiko Indices is a registered Benchmark Administrator under the EU Benchmark Regulations and is regulated by the European Securities and Markets Authority (ESMA). Kaiko crypto asset benchmarks and indices are used by exchanges, asset managers and funds, and other market participants across the world. Solactive is the calculation agent of the Index and is also the index provider of each of the Sub-indexes detailed below. Solactive also calculates the value of the Carbon Credit Futures portion of the Index and the value of the Index overall. Since its creation in 2007, Solactive AG has become one of the key players in the indexing space. Solactive AG is a German multi-asset class index provider focusing on tailor-made indices, developing, calculating and distributing them worldwide. Offering a fast time to market service with great flexibility and at a reasonable cost has allowed Solactive AG to become one of the fastest growing index providers over the past few years. Solactive AG now calculates indices for more than 500 clients in Europe, America and Asia. As of October 2024, approximately $300 billion are invested in products linked to more than 35,000 indices calculated by Solactive AG globally, primarily in the form of 650 ETFs. Performance of the Offered commodity pools operated by the cpo The following performance information is presented in accordance with CFTC regulations. The performance of the Fund will differ materially from the performance of the Related Pools which is included herein. The performance of the Related Pools which is summarized herein is expected to be materially different from the Fund and the past performance summaries of the Related Pools below are generally not representative of how the Fund might perform in the future. No performance information is presented with respect to the Fund, which has not commenced investment operations prior to the date of this Prospectus and which will not begin trading until after the initial Creation Baskets of the Fund are purchased by the initial Authorized Purchaser (all as described in the "Plan of Distribution" section). The performance of the Fund will differ materially from the Related Pools listed below. Performance information is set forth in accordance with CFTC regulations, since each fund s inception of trading. Blueprint Chesapeake Multi-Asset Trend ETF (TICKER: TFPN) Blueprint Chesapeake Multi-Asset Trend ETF commenced trading and investment operations on July 12, 2023. The Fund is listed on NYSE Arca and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 31, 2024): 5,600,000 Aggregate gross sale price for units issued: $151,494,610 Pool NAV as of December 31, 2024: $140,706,872 NAV per Share as of December 31, 2024: $24.69 Worst monthly percentage drawdown*: –3.88% / December 2024 Worst peak to valley drawdown**: –6.4% / May 2024 – October 2024 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2022 2023 2024 January % % 0.18 % February % % 3.44 % March % % 3.15 % April % % (2.18) % May % % 2.72 % June % % (2.95) % July % (0.24)+ % 0.03) % August % (0.04) % (3.50) % September % 0.09 % 1.21 % October % 0.17 % (1.29) % November % (2.09) % 6.81 % December % (0.37) % (3.88) % Annual Rate of Return % (2.48) % 3.19 % + For the partial month beginning July 12, 2023 Cambria Chesapeake Pure Trend ETF (TICKER: MFUT) The Cambria Chesapeake Pure Trend ETF commenced trading and investment operations on May 29, 2024. The Fund is listed on NYSE Arca and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 31, 2024): 1,350,000 Aggregate gross sale price for units issued: $244,028,115 Pool NAV as of December 31, 2024: $22,392,633 NAV per Share as of December 31, 2024: $16.59 Worst monthly percentage drawdown*: -8.84% / October 2024 Worst peak to valley drawdown**: -17.10% / May 2024 – October 2024 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Month 2024 January - February - March - April - May (0.35)+ % June (3.46) % July (3.33) % August (4.22) % September 2.05 % October (8.84) % November 2.01 % December (1.56) % Annual Rate of Return (16.79) % + For the partial month beginning May 29, 2024 CNIC ICE US Carbon Neutral Power Futures Index ETF (TICKER: AMPD) The CNIC ICE US Carbon Neutral Power Futures Index ETF commenced trading and investment operations on May 9, 2023. The Fund is listed on NYSE Arca and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 29, 2024): 200,000 Aggregate gross sale price for units issued: $76,892,925 Pool NAV as of December 31, 2024: $4,023,213 NAV per Share as of December 31, 2024: $20.12 Worst monthly percentage drawdown*: -8.02% / May 2023 Worst peak to valley drawdown: **: -10.15% / October 2023 – December 2023 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2023 2024 January % 2.39 % February % (4.89) % March % 2.18 % April % (.35) % May (8.02) % 2.65 % June 2.74 % (.07) % July 1.85 % (5.59) % August 4.61 % (5.03) % September 0.11 % 1.85 % October 1.41 % (5.34) % November (6.78) % 1.34 % December (3.37) % 2.87 % Annual Rate of Return (7.92) % (7.88) % Ionic Inflation Protection ETF (TICKER: CPII) The Ionic Inflation Protection ETF commenced trading and investment operations on June 29, 2022. The Fund is listed on NYSE Arca and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 29, 2024): 625,000 Aggregate gross sale price for units issued: $12,018,750 Pool NAV as of December 31, 2024: $12,015,924 NAV per Share as of December 31, 2024: $19.23 Worst monthly percentage drawdown*: –2.40% (January 2023) Worst peak to valley drawdown**: -3.15% / October 2023 – December 2023 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2022 2023 2024 January % (2.40) % 1.38 % February % 2.49 % 1.60 % March % (0.25) % 0.02 % April % (0.58) % 3.04 % May % (0.24) % (0.49) % June 0.01 % 0.63 % (0.56) % July 1.06 % 1.23 % (1.12) % August 1.13 % 0.01 % (0.21) % September (2.06) % 2.03 % 0.50 % October 3.08 % 1.33 % 1.75 % November (2.37) % (2.30) % (0.15) % December 0.26 % (0.85) % 1.07 % Annual Rate of Return 1.02 % 1.58 % 6.97 % Return Stacked Bonds & Managed Futures ETF (TICKER: RSBT) The Return Stacked Bonds & Managed Futures ETF commenced trading and investment operations on February 8, 2023. The Fund is listed on CBOE and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 29, 2024): 5,150,000 Aggregate gross sale price for units issued: $89,661,500 Pool NAV as of December 31, 2024: $83,945,611 NAV per Share as of December 31, 2024: $17.41 Worst monthly percentage drawdown*: -7.91% / March 2023 Worst peak to valley drawdown**: -10.39% / February 2023 – May 2023 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2023 2024 January % (2.42) % February (1.08) % 2.71 % March (7.91) % 4.70 % April 0.76 % (0.05) % May (2.24) % 0.11 % June 3.05 % 0.86 % July (0.91) % (1.70) % August (4.14) % (0.15) % September 1.94 % 1.22 % October (2.10) % (8.77) % November (2.06) % 1.63 % December 3.22 % (0.08) % Annual Rate of Return (11.38) % (3.07) % Return Stacked(R) U.S. Stocks & Futures Yield ETF (TICKER: RSSY) The Return Stacked(R) U.S. Stocks & Futures Yield ETF commenced trading and investment operations on May 28, 2024. The Fund is listed on CBOE and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 31, 2024): 7,200,000 Aggregate gross sale price for units issued: $146,304,000 Pool NAV as of December 31, 2024: $147,851,592 NAV per Share as of December 31, 2024: $20.32 Worst monthly percentage drawdown*: -5.34% / October 2024 Worst peak to valley drawdown: -7.50% / June 2024 – October 2024 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2024 January - February - March - April - May 0.26+ % June 4.87 % July (2.80) % August (0.08) % September 0.55 % October (5.34) % November 6.62 % December (1.93) % Annual Rate of Return 1.62 % + For the partial month beginning May 28, 2024 Return Stacked(R) Bonds & Futures Yield ETF (TICKER: RSBY) The Return Stacked(R) Bonds & Futures Yield ETF commenced trading and investment operations on August 20, 2024. The Fund is listed on CBOE and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 31, 2024): 6,050,000 Aggregate gross sale price for units issued: $108,900,000 Pool NAV as of December 31, 2024: $108,025,558 NAV per Share as of December 31, 2024: $18.00 Worst monthly percentage drawdown*: -6.77% / October 2024 Worst peak to valley drawdown**: -8.20% / August 2024 – October 2024 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2024 January - February - March - April - May - June - July - August (1.14)+ % September (0.49 % October (6.77) % November 1.74 % December (1.32) % Annual Rate of Return (7.92) % + For the partial month beginning August 20, 2024 Return Stacked(R) U.S. Stocks & Managed Futures ETF (TICKER: RSST) Return Stacked(R) U.S. Stocks & Managed Futures ETF commenced trading and investment operations on September 6, 2023. The Fund is listed on CBOE and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 31, 2024): 10,825,000 Aggregate gross sale price for units issued: $257,849,364 Pool NAV as of December 31, 2024: $258,057,300 NAV per Share as of December 31, 2024: $23.84 Worst monthly percentage drawdown*: -7.70% / October 2024 Worst peak to valley drawdown**: -18.16% / July 2024 – August 2024 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2023 2024 January 3.91 % February 9.65 % March 6.57 % April (1.69) % May 3.54 % June 3.11 % July (2.78) % August 0.37 % September (2.16)+ 2.32 % October (2.73) (7.70) % November 2.81 6.58 % December 4.00 (0.95) % Annual Rate of Return 1.76 18.32 % + For the partial month beginning September 6, 2023 STKD Bitcoin & Gold ETF (TICKER: BTGD) The STKD Bitcoin & Gold ETF commenced trading and investment operations on October 15, 2024. The Fund is listed on CBOE and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 31, 2024): 975,000 Aggregate gross sale price for units issued: $25,730,250 Pool NAV as of December 31, 2024: $24,410,301 NAV per Share as of December 31, 2024: $26.39 Worst monthly percentage drawdown*: -6.90% / December 2024 Worst peak to valley drawdown**: -7.08% / November 2024 – December 2024 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2024 January - February - March - April - May - June - July - August - September - October 6.39+ % November 33.47 % December (6.90) % Annual Rate of Return 32.20 % +For the partial month beginning October 15, 2024 Unlimited HFND Cayman Subsidiary (TICKER: HFND) The Unlimited HFND Cayman Subsidiary (TICKER: HFND) commenced trading and investment operations on January 3, 2024. The Fund is listed on NYSE Arca and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 31, 2024): 1,475,000 Aggregate gross sale price for units issued: $95,064,827 Pool NAV as of December 31, 2024: $32,001,356 NAV per Share as of December 31, 2024: $21.69 Worst monthly percentage drawdown*: -2.64% / April 2024 Worst peak to valley drawdown**: -2.68% / March 2024 – April 2024 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2024 January (0.03) % February 1.51 % March 3.38 % April (2.64) % May 2.56 % June 0.05 % July 1.38 % August 0.11 % September 1.88 % October (1.01) % November 3.17 % December (2.07) % Annual Rate of Return 7.94 % See accompanying footnotes and explanatory information below * The monthly rate of return is calculated by dividing the ending NAV of a given month by the ending NAV of the previous month, subtracting 1 and multiplying this number by 100 to arrive at a percentage increase or decrease. Draw-down: Losses experienced over a specified period. Draw-down is measured on the basis of monthly returns only and does not reflect intra-month figures. Worst Monthly Percentage Draw-down: The largest single month loss sustained since inception of trading. Worst Peak-to-Valley Draw-down: The largest percentage decline in the NAV per share over the history of the fund. This need not be a continuous decline but can be a series of positive and negative returns where the negative returns are larger than the positive returns. Worst Peak-to-Valley Draw-down represents the greatest cumulative percentage decline in month-end per share NAV that is not equaled or exceeded by a subsequent month-end per share NAV. Management s discussion and analysis of financial condition and results of operations The Fund is newly formed and has no operating history. Charges Breakeven Analysis The breakeven analysis set forth below is a hypothetical illustration of the approximate dollar returns and percentage returns for the redemption value of a single Share to equal the amount invested twelve months after the investment is made. For purposes of this breakeven analysis, an initial selling price of $25.00 per Share, is assumed. The breakeven analysis is an approximation only and assumes a constant month-end NAV. In order for a hypothetical investment in Shares to breakeven over the next 12 months, assuming a selling price of $25.00 per Share, the investment would have to generate a 0.16% or $0.04 return. The numbers in the chart below have been rounded to the nearest 0.01. Per Share Assumed initial selling price per Share(1) $25.00 Management Fee(2) $(0.17) Estimated Brokerage Commissions and Fees(3) $(0.04) Other Fund Fees and Expenses(4) $— Interest and Other Income(5) $0.17 Amount of trading income (loss) required for the redemption value at the end of one year to equal the selling price of the Share $(0.04) Percentage of initial selling price per Share(6) (0.16)% (1)The breakeven analysis set forth in this table assumes that the Shares have a constant NAV equal to the amount shown. This amount is the expected NAV of the Shares on the first day of Fund operations. The actual NAV of the Fund differs and is likely to change on a daily basis. The numbers provided in this chart have been rounded to the nearest 0.01. The breakeven analysis reflects all fees and expenses, including estimated rebalancing expenses that are anticipated to be incurred by the Trust during a year of an investor s investment. (2)From the Management Fee, the Sponsor pays certain of the routine operational, administrative and other ordinary expenses of the Fund, generally as determined by the Sponsor, including but not limited to, fees and expenses of the Administrator, Sub-Administrator, Bitcoin Custodian, Non-Digital Custodian, Marketing Agent, Transfer Agent, licensors, accounting and audit fees and expenses, tax preparation expenses, legal fees, ongoing SEC registration fees, and report preparation and mailing expenses. These fees and expenses are not included in the breakeven table because they are paid for by the Sponsor through the proceeds from the Management Fee. (3)Reflects estimated brokerage commissions and fees in relation to the Carbon Credit Futures and reflected on a per trade basis. The actual amount of brokerage commissions and trading fees to be incurred will vary based upon the trading frequency of the Fund. The Sponsor may elect to pay or waive a portion of these fees. The Fund may elect to waive fees in order to reduce the Fund s expenses. Investors may pay customary brokerage commissions in connection with purchases of the Shares. Because such brokerage commission rates will vary from investor to investor, such brokerage commissions have not been included in the Breakeven Table. Investors are encouraged to review the terms of their brokerage accounts for applicable charges. (4)The Fund pays all transaction related fees and expenses charged in connection with trading activities for the Fund s investments and for maintenance of its CFTC regulatory status as a commodity pool. The Fund also pays all of its non-recurring and unusual fees and expenses, if any, as determined by the Sponsor. Non-recurring and unusual fees and expenses are unexpected or unusual in nature, such as legal claims and liabilities and litigation costs or indemnification or other unanticipated expenses. Extraordinary fees and expenses also include material expenses which are not currently anticipated obligations of the Fund. Routine operational, administrative and other ordinary expenses are not deemed extraordinary expenses. (5)The Fund seeks to earn interest and other income in high credit quality, short-duration instruments or deposits associated with the pool s cash management in connection with its investments in futures contracts and other financial instruments, that may be used to offset expenses. These investments may include, but are not limited to, short-term Treasury Securities, demand deposits, and money market funds. Considering various uncertain factors in the US and commodity markets, the Sponsor has estimated a blended interest rate of 4.50%. The actual rate may vary and not all assets within the Fund will necessarily earn interest. The actual rate may vary and not all assets of the Fund will earn interest. (6)This represents the estimated approximate percentage for the redemption value of a hypothetical initial investment in a single Share equal to the amount invested twelve months after the investment was made. The estimated approximate percentage of selling price is 0.16% or $0.04 per share. Management Fee The Fund pays the Sponsor a management fee (the "Management Fee"), monthly in arrears, in an amount equal to 0.68% per annum of the daily NAV of the Fund. The Management Fee is paid in consideration of the Sponsor s services related to the management of the Fund s business and affairs. No other management fee is paid by the Fund. The Management Fee is paid in consideration of the Sponsor s trading advisory services and the other services provided to the Fund that the Sponsor pays directly. From the Management Fee, the Sponsor is responsible for paying certain fees and expenses of the Administrator, Trustee, Marketing Agent, Transfer Agent, and certain routine operational, administrative and other ordinary expenses of the Fund. These fees and expenses are not included in the Breakeven Table. The Fund pays all transaction-related fees and expenses charged in connection with the trading activities for the Fund s investments and for maintenance of its CFTC regulatory status as a commodity pool. Licensing and Index Calculation Fee The Fund pays a fee to Kaiko to administer and maintain the Index. Recurring and Non-Recurring Fees and Expenses/Other Fund-Assumed Fees and Expenses The Fund pays all of its non-recurring and unusual fees and expenses, if any, as determined by the Sponsor. Non-recurring and unusual fees and expenses which are unexpected or unusual in nature, such as legal claims and liabilities and litigation costs or indemnification or other unanticipated expenses. Extraordinary fees and expenses also include material expenses which are not currently anticipated obligations of the Fund. Routine operational, administrative and other ordinary expenses are not deemed extraordinary expenses. In addition, as noted below, the Fund pays all transaction-related fees and expenses charged in connection with trading activities for the Fund s investments. Further, the Fund pays all fees and expenses required for maintenance of its CFTC regulatory status as a commodity pool. Selling Commission Retail investors may purchase and sell Shares through traditional brokerage accounts. Investors are expected to be charged a customary commission by their brokers in connection with purchases of Shares that will vary from investor to investor. Investors are encouraged to review the terms of their brokerage accounts for applicable charges. The price at which an Authorized Purchaser sells a Share may be higher or lower than the price paid by such Authorized Purchaser in connection with the creation of such Share in a Creation Unit. Brokerage Commissions and Fees The Fund pays all of its respective brokerage commissions, including applicable exchange fees, NFA fees and give-up fees, pit brokerage fees and other transaction related fees and expenses charged in connection with trading activities for the Fund s investments in CFTC regulated investments. The Fund bears other transaction costs including the effects of trading spreads and financing costs/fees, if any, associated with the use of Carbon Credit Futures, and costs relating to the purchase of money market instruments. USE OF PROCEEDS The Fund uses the proceeds of the offering of Shares of the Fund to make investments in a manner consistent with its investment objective. Proceeds received by the Fund from the issuance of Baskets will be used to acquire bitcoin and Carbon Credit Futures. Such deposits of cash are held by the Non-Digital Custodian on behalf of the Fund until (i) transferred to the Bitcoin Custodian and used to acquire bitcoin; (ii) transferred to an FCM to facilitate the Fund s investment in Carbon Credit Futures; (iii) accrued and distributed to pay fees due to the Sponsor and Fund expenses and liabilities not assumed by the Sponsor, (iv) distributed to Authorized Purchasers in connection with redemptions of Baskets, or (v) disposed of in a liquidation of the Fund. When transacting in Carbon Credit Futures, the expenses due to the Sponsor for the Management Fee and other Fund expenses are not considered when determining the number of Carbon Credit Futures to purchase or sell. In connection with receipt of a Purchase Order (as defined below) accepted by the Marketing Agent and Transfer Agent, the Sponsor, on behalf of the Fund, is responsible for acquiring bitcoin and increasing its investment in Carbon Credit Futures in an amount equal to the value of the Basket. The proceeds will be allocated between the Bitcoin Custodian and the Non-Digital Custodian in accordance with the Fund s investment strategies. The Bitcoin Trading Counterparties with which the Sponsor will engage in bitcoin transactions are unaffiliated third-parties and all transactions will be done on an arms-length basis. When seeking to purchase bitcoin on behalf of the Fund, the Sponsor will seek to purchase bitcoin at a price as close to the Bitcoin Price as practical from any of the approved Bitcoin Trading Counterparties. Once agreed upon, the transaction will generally occur on an "over-the-counter" basis. Transfers to and from the Fund of bitcoin are "on-chain" transactions represented on the Bitcoin blockchain. Transfer fees with respect to this on-chain transfer of bitcoin are paid by the Bitcoin Custodian. The Bitcoin Trading Counterparty must deposit the required amount of bitcoin by end of day Eastern Time on the business day following the Purchase Order Date prior to any movement of cash from the Non-Digital Custodian or delivery of Shares from the Transfer Agent. Upon receipt of the deposit amount of bitcoin at the Bitcoin Custodian from the Bitcoin Trading Counterparty, the Bitcoin Custodian will notify the Sponsor that the bitcoin has been received. The Sponsor will then notify the Transfer Agent that the bitcoin has been received, and the Transfer Agent will direct DTC to credit the number of Shares ordered to the Authorized Purchaser s DTC account and will wire the cash previously sent by the Authorized Purchaser to the Bitcoin Trading Counterparty to complete settlement of the Purchase Order and the acquisition of the bitcoin by the Fund. With respect to the Fund s investments in Carbon Credit Futures, The Sponsor causes the Fund to transfer the proportional amount of proceeds of the sale of Creation Baskets to the Non-Digital Custodian or another financial institution for use in trading activities and/or investment in Carbon Credit Futures and cash and cash equivalents. When the Fund purchases Carbon Credit Futures, the Fund is required to deposit with the FCM on behalf of the exchange a portion of the value of the contract or other interest as security to ensure payment for the obligation under the Carbon Credit Futures at maturity. This deposit is known as initial margin. The Sponsor invests the Fund s assets that remain after margin and collateral is posted in cash and cash equivalents. Subject to these margin and collateral requirements, the Sponsor has sole authority to determine the percentage of assets that will be: (i) held as margin or collateral with the FCM or other custodian; (ii) used for other investments; and (iii) held in bank accounts to pay current obligations and as reserves. In general, the Fund expects that it will be required to post approximately 10% to 20% of the notional amount of a Carbon Credit Future as initial margin when entering into such contract. Ongoing margin and collateral payments will generally be required based on changes in the value of the Carbon Credit Futures. Cash and cash equivalents held by the Fund constitute reserves that are available to meet ongoing margin and collateral requirements. All interest or other income is used for the Fund s benefit. An FCM, counterparty, government agency or commodity exchange could increase margin or collateral requirements applicable to the Fund to hold trading positions at any time. Moreover, margin is merely a security deposit and has no bearing on the profit or loss potential for any positions held. The Fund s assets that are used to post the approximate 10% to 20% of notional value for margin held by the FCM are held in segregation pursuant to the CEA and CFTC regulations. For purposes of creation and redemption orders for Carbon Credit Futures, the settlement price on the primary exchange will be used. In connection with a Redemption Order (as defined below), the Sponsor, on behalf of the Fund, is responsible for selling bitcoin and Carbon Credit Futures in an amount equal to the value of the Basket. When seeking to sell bitcoin, the Sponsor will seek to sell bitcoin at prices as close to the Bitcoin Price as practical on terms from any of the approved Bitcoin Trading Counterparties. Once agreed upon, the transaction will generally occur on an "over-the-counter" basis. The Bitcoin Custodian will not send the required amount of bitcoin until the Non-Digital Custodian has received the cash from the Bitcoin Trading Counterparty and is instructed by the Sponsor to make such transfer. Once the Bitcoin Trading Counterparty has sent the cash to the Non-Digital Custodian in an agreed upon amount to settle the agreed upon sale of the Basket Amount of bitcoin, the Transfer Agent will notify the Sponsor. The Sponsor will then notify the Bitcoin Custodian to transfer the bitcoin to the Bitcoin Trading Counterparty, and the Transfer Agent will facilitate the Shares in exchange for cash. Once the Authorized Purchaser has delivered the Shares represented by the Basket to be redeemed to the Fund s DTC account, the Non-Digital Custodian will wire the requisite amount of cash to the Authorized Purchaser. Each Bitcoin Trading Counterparty must be approved by the Sponsor. The Sponsor has instituted a process for approving and monitoring Bitcoin Trading Counterparties. All bitcoin trading counterparties must be approved by the Sponsor before the Sponsor, on behalf of the Trust, will engage in transactions with the entity. The Sponsor continuously reviews all approved Bitcoin Trading Counterparties and will reject the approval of any previously approved Bitcoin Trading Counterparty if new information arises regarding the entity that puts the appropriateness of that entity as an approved Bitcoin Trading Counterparty in doubt. Pursuant to this process, the Sponsor has approved each of JSCT, LLC (which is an affiliate of Jane Street Capital, LLC an Authorized Purchaser for the Fund), DV Chain, LLC and Gemini to act as a Bitcoin Trading Counterparty. Bitcoin Trading Counterparties may be added at any time, subject to the discretion of the Sponsor. Who may subscribe Only Authorized Purchasers may create or redeem Baskets. Each Authorized Purchaser must (1) be a registered broker-dealer or other securities market participant such as a bank or other financial institution which is not required to register as a broker-dealer to engage in securities transactions, (2) be a member of a national clearing agency, and (3) have entered into an agreement with the Sponsor (an Authorized Purchaser Agreement). DESCRIPTION OF CREATION AND REDEMPTION OF SHARES When the Fund creates or redeems its Shares, it will do so only in Baskets (blocks of 10,000 Shares) based on the NAV per Share (net of accrued but unpaid expenses and liabilities) multiplied by the number of Shares comprising a Basket (10,000). This is called the "Basket Price." The Fund will sell its assets (in the case of redemption orders) or allocate proceeds (in the case of creation orders) in accordance with the assets of the Index. Stated differently, the Sponsor will facilitate the liquidation of an amount of bitcoin and Carbon Credit Futures that will, in aggregate cover the sufficient assets necessary redemption order or invest the proceeds from a creation order in bitcoin and Carbon Credit Futures, in each instance so that the Fund will continue to track the Index s 80% allocation in bitcoin and 20% allocation in Carbon Credit Futures. With respect to Carbon Credit Futures, the Sponsor will instruct the liquidation or acquisition of each component Carbon Credit Future in accordance with the weighting of the Index (i.e., to maintain the weighting reflected in the Index of Carbon Credit Futures referencing EU ETS, CCA and RGGI). The Sponsor will retain discretion to determine which of the Custodians, to the extent there are multiple custodians for bitcoin or multiple custodians for cash and cash equivalents in connection with Carbon Credit Futures, are selected to facilitate the respective order. Authorized Purchasers are the only persons that may place orders to create and redeem Baskets. Authorized Purchasers must be (1) registered broker-dealers or other securities market participants, such as banks and other financial institutions, that are not required to register as broker-dealers to engage in securities transactions described below, and (2) DTC Participants. To become an Authorized Purchaser, a person must enter into an Authorized Purchaser Agreement. The Authorized Purchaser Agreement provides the procedures for the creation and redemption of Baskets and for the delivery of the cash or Shares required for such creation and redemptions. The Authorized Purchaser Agreement and the related procedures attached thereto may be amended by the Fund, without the consent of any Shareholder or Authorized Purchaser. Authorized Purchasers must pay the Transfer Agent a non-refundable fee for each order they place to cover the expenses incurred in connection with the creation and redemption of Baskets. The transaction fee may be waived, reduced, increased or otherwise changed by the Sponsor in its sole discretion. Authorized Purchasers who make deposits with the Fund in exchange for Baskets receive no fees, commissions or other form of compensation or inducement of any kind from either the Fund or the Sponsor, and no such person will have any obligation responsibility to the Sponsor or the Fund to effect any sale or resale of Shares. Each Authorized Purchaser will be required to be registered as a broker-dealer under the Exchange Act and a member in good standing with FINRA, or exempt from being or otherwise not required to be licensed as a broker-dealer or a member of FINRA, and will be qualified to act as a broker or dealer in the states or other jurisdictions where the nature of its business so requires. Certain Authorized Purchasers may also be regulated under federal and state banking laws and regulations. Each Authorized Purchaser has its own set of rules and procedures, internal controls and information barriers as it determines is appropriate in light of its own regulatory regime. Under the Authorized Purchaser Agreement, the Sponsor, and the Fund under limited circumstances, have agreed to indemnify the Authorized Purchasers against certain liabilities, including liabilities under the Securities Act, and to contribute to the payments the Authorized Purchasers may be required to make in respect of those liabilities. In connection with any issuance or redemption of a Creation Basket, the Fund deploys assets or liquidates assets, as applicable, in proportion with the Fund s holdings such that it maintains an 80%/20% ratio of bitcoin and Carbon Credit Futures. In the case of the issuance of a Creation Basket, the Fund will allocation 80% of the proceeds from such Creation Basket and 20% of the proceeds to Carbon Credit Futures in proportion to those represented in the Index. A portion of the assets attributable to the Carbon Credit Futures will be deposited with the FCM, and the remainder would remain deployed in connection with purchasing notional exposure to the respective Carbon Credit Futures in proportion to their weights in the Index. In the case of the redemption of a Creation Basket, the Fund will raise sufficient assets to meet such redemption request. Accordingly, the Sponsor would instruct the sale of bitcoin to represent 80% of such necessary assets, and reduce notional exposure to the applicable Carbon Credit Futures to cover the remaining 20% of such necessary assets. Such notional exposure would be reduced in proportionate amounts to maintain the proper exposure to the Index weights. After such liquidation, the Fund s holdings would maintain its 80%/20% ratio to bitcoin and Carbon Credit Futures. See "Investment Objective and Investment Strategy—Principal Investment Strategies—Carbon Credit Futures" for additional information. The following description of the procedures for the creation and redemption of Baskets is only a summary and an investor should refer to the relevant provisions of the Trust Agreement and the form of Authorized Purchaser Agreement for more detail. The Trust Agreement and form of Authorized Purchaser Agreement are filed as exhibits to the registration statement of which this prospectus is a part. Determination of Basket Price The Basket Price required to create each Basket changes from day to day. On each day that the Exchange is open for regular trading, the Administrator adjusts the Basket Price as appropriate to reflect accrued expenses. The computation is made by the Administrator each business day prior to the commencement of trading on the Exchange. The Basket Price so determined is communicated to all Authorized Purchasers and made available on the Trust s website for the Shares. The Exchange also publishes the Basket Price determined by the Administrator as indicated above. Creation Procedures The manner by which creations are made is dictated by the terms of the Authorized Purchaser Agreement. On any business day, an Authorized Purchaser may create Shares by placing an order to purchase one or more Baskets with the Transfer Agent through the Marketing Agent in exchange for cash (a "Purchase Order"). Such orders are subject to approval by the Marketing Agent and Transfer Agent and may be received: (i) in writing by facsimile; (ii) through the Transfer Agent s electronic order entry system; or (iii) by telephone to the Administrator at the Transfer Agent according to certain additional procedures. Such orders are subject to approval by the Marketing Agent and Transfer Agent. For purposes of processing creation and redemption orders, a "business day" means any day other than a day when the Exchange is closed for regular trading. Purchase Orders must be placed by 2:00 p.m., eastern time, or the close of regular trading on the Exchange, whichever is earlier (the "Order Cut-Off Time"), or an earlier time as determined and communicated by the Sponsor and its agent. The day on which a Purchase Order is accepted by the Transfer Agent is considered the "Purchase Order Date." If the Purchase Order is accepted, it will receive the next Business Day s Basket Price if submitted before the applicable Order Cutoff Time. By placing a Purchase Order, an Authorized Purchaser agrees to deposit cash as determined by the Sponsor with the Fund s Non-Digital Custodian. The total deposit required to create each basket ("Creation Basket Deposit") will be an amount of cash that is in the same proportion to the total assets of the Fund (net of estimated accrued but unpaid fees, expenses and other liabilities) on the date the Purchase Order is properly received as the number of Shares to be created under the Purchase Order is in proportion to the total number of Shares outstanding on the date the Purchase Order is received. The Sponsor, through the Transfer Agent, shall notify the Authorized Purchaser of the amount of cash to be included in deposits to create Baskets by e-mail or telephone correspondence and such amount will be available via the Fund s website. An Authorized Purchaser who places a Purchase Order is responsible for transferring to the Fund s account with the Non-Digital Custodian the required amount of cash by the end of the next Business Day following the Purchase Order Date (T+1) or as agreed to by the Authorized Purchaser, Sponsor, Marketing Agent and Transfer Agent in advance of when the Purchase Order is placed. Prior to the delivery of Baskets for a Purchase Order, the Authorized Purchaser must also have submitted via CNS the non-refundable transaction fee due for the Purchase Order. Upon receipt of the deposit amount, the Administrator will cause DTC to credit the number of Baskets ordered to the Authorized Purchaser s DTC account. The Sponsor may in its sole discretion limit the number of Shares created pursuant to Purchase Orders on any specified day without notice to the Authorized Purchasers and may direct the Marketing Agent to reject any Purchase Orders in excess of such capped amount. The Sponsor may choose to limit the number of Shares created pursuant to Purchase Orders when it deems so doing to be in the best interest of Shareholders. It may choose to do so when it believes the market is too volatile to execute a bitcoin transaction, when it believes the price of bitcoin is being inconsistently, irregularly, or discontinuously published from bitcoin trading venues and other data sources, or when it believes other similar circumstances may create a scenario in which accepting Purchase Orders would not be in the best interests of the Shareholders. The Sponsor does not believe that the Fund s ability to arrive at such a determination will have a significant impact on the Shares in the secondary market because it believes that the ability to create Shares would be reinstated shortly after such determination is made, and any entity desiring to create Shares would be able to do so once the ability to create Shares is reinstated. However, it is possible that such a determination would cause the Shares to trade at premiums or discounts relative to the Fund s NAV on the secondary market if arbitrageurs believe that there is risk that the creation and redemption process is not available, as this process is a component of keeping the price of the Shares on the secondary market closely aligned to the Fund s NAV. Rejection of Purchase Orders The Sponsor or the Marketing Agent reserve the absolute right to reject acceptance of a Purchase Order if: it determines that, due to position limits or otherwise, investment alternatives that will enable a Fund to meet its investment objective are not available to the Fund at that time; it determines that the Purchase Order is not in proper form; it believes that acceptance would have adverse tax consequences to the Fund or the Shareholders; the acceptance or receipt of a Creation Basket Deposit would, in the opinion of legal counsel to the Sponsor, be unlawful; or if circumstances outside the control of the Sponsor, the Marketing Agent or the Non-Digital Custodian make it for all practical purposes not feasible to process creations of Creation Baskets. None of the Sponsor, the Marketing Agent, the Non-Digital Custodian or the Bitcoin Custodian will be liable for the rejection of any Purchase Order. The Marketing Agent shall notify the Authorized Purchaser of a rejection or revocation of any Purchase Order, however it is under no duty to give notification of any specific defects or irregularities in the delivery of the Creation Basket Deposit, nor shall the Marketing Agent or the Fund incur any liability for the failure to give any such notification. The Fund and Marketing Agent may not revoke a previously accepted Purchase Order. Redemption Procedures On any business day, an Authorized Purchaser may place an order with the Transfer Agent to redeem one or more Baskets (a "Redemption Order"). Redemption Orders must be placed by 2:00 p.m. eastern time (the "Redemption Order Cut-Off Time"), or the close of regular trading on the Exchange, whichever is earlier. A Redemption Order will be effective on the date it is accepted by the Transfer Agent ("Redemption Order Date"). By placing a Redemption Order, an Authorized Purchaser agrees to deliver the Redemption Basket to be redeemed through DTC s book-entry system to the Fund s account with the Non-Digital Custodian not later than the end of the next Business Day following the effective date of the Redemption Order ("Redemption Distribution Date") or the end of such later Business Day as agreed to by the Authorized Purchaser and the Transfer Agent in advance of when the Redemption Order is placed. Failure to consummate such delivery shall result in the cancellation of the order. Prior to the delivery of the redemption distribution for a Redemption Order, the Authorized Purchaser must also have submitted via CNS or such other means deemed acceptable by the Sponsor, the non-refundable Transaction Fee due for the Redemption Order. The redemption distribution due from the Fund is delivered to the authorized Purchaser on the Redemption Distribution Date if the Fund s DTC account has been credited with the Baskets to be redeemed pursuant to the terms of the Authorized Purchaser Agreement. That notwithstanding, no such distribution shall be made until the Non-Digital Custodian has received the cash necessary from selling the Fund s bitcoin to effectuate the Redemption Basket from the Bitcoin Trading Counterparty. The Bitcoin Custodian will not send the requisite amount of bitcoin until the Non-Digital Custodian has received the cash from the Bitcoin Trading Counterparty and is instructed by the Sponsor to make such transfer. Once the Bitcoin Trading Counterparty has sent the cash to the Non-Digital Custodian in an agreed upon amount to settle the agreed upon sale, the Transfer Agent will notify the Sponsor, who will in turn notify the Bitcoin Custodian to transfer the bitcoin to the Bitcoin Trading Counterparty. The Transfer Agent will then facilitate the Shares in exchange for cash. Once the Authorized Purchaser has delivered the Shares represented by the Basket to be redeemed to the Fund s DTC account, the Non-Digital Custodian will wire the requisite amount of cash to the Authorized Purchaser. If the Fund s DTC account has not been credited with all of the Shares of the Basket to be redeemed, the redemption distribution will be delayed until such time as the Transfer Agent confirms receipt of all such Shares. If the Bitcoin Trading Counterparty fails to deliver the cash to the Non-Digital Custodian, the transaction will be cancelled, and no transfer of bitcoin or Shares will occur. Suspension or Rejection of Redemption Orders The Sponsor may, in its discretion, suspend the right of redemption, or postpone the redemption settlement date, (1) for any period during which the Exchange is closed other than customary weekend or holiday closings, or trading on the Exchange is suspended or restricted, (2) for any period during which an emergency exists as a result of which delivery, disposal or evaluation of [Treasuries] is not reasonably practicable (for example, as a result of a significant technical failure, power outage, or network error), or (3) for such other period as the Sponsor determines to be necessary for the protection of the Shareholders. None of the Sponsor, the Marketing Agent, Non-Digital Custodian or the Bitcoin Custodian will be liable to any person or in any way for any loss or damages that may result from any such suspension or postponement. Redemption Orders must be made in whole Baskets. The Sponsor or the Marketing Agent reserve the absolute right to reject acceptance of a Redemption Order if: it is determined by the Sponsor or Marketing Agent to not be in the proper form; the fulfillment of which its counsel advises might be unlawful; or if the number of Shares being redeemed would reduce the remaining outstanding Shares below 50,000 Shares (i.e., five baskets of 10,000 Shares each) or less, unless the Sponsor has reason to believe that the placer of the redemption order does in fact possess all the outstanding Shares of the Fund and can deliver them. With respect to the suspension of creation or redemption orders, such suspension may cause to price of the Shares to deviate more significantly from the Fund s NAV per Share than would be the case if such suspension had not occurred. The Fund will notify Shareholders of any such suspension in a prospectus supplement and/or a current report on Form 8-K or in its annual or quarterly reports. Creation and Redemption Transaction Fee To compensate the Transfer Agent for expenses incurred in connection with the creation and redemption of Baskets, an Authorized Purchaser is required to pay a transaction fee to the Transfer Agent to create or redeem Baskets, which does not vary in accordance with number of Baskets in such order. The transaction fee may be reduced, increased or otherwise changed by the Sponsor. As of the date of this prospectus, the transaction fee is $300 and is payable in cash. Tax Responsibility Authorized Purchasers are responsible for any transfer tax, sales or use tax, stamp tax, recording tax, value added tax or similar tax or governmental charge applicable to the creation or redemption of Baskets, regardless of whether or not such tax or charge is imposed directly on the Authorized Purchaser, and agree to indemnify the Sponsor and the Fund if they are required by law to pay any such tax, together with any applicable penalties, additions to tax and interest thereon. Secondary Market Transactions As discussed above, Authorized Purchasers are the only persons that may place orders to create and redeem Baskets. Authorized Purchasers must be registered broker-dealers or other securities market participants, such as banks and other financial institutions that are not required to register as broker-dealers to engage in securities transactions. An Authorized Purchaser is under no obligation to create or redeem Baskets, and an Authorized Purchaser is under no obligation to offer to the public Shares of any Basket it does create. Authorized Purchasers that do offer to the public Shares from the Basket they create will do so at per-Share offering prices that are expected to reflect, among other factors, the trading price of the Shares on the Exchange, the NAV of the Fund at the time the Authorized Purchaser purchased the Baskets, the NAV of the Shares at the time of the offer of the Shares to the public, the supply of and demand for Shares at the time of sale, and the liquidity of the Fund s investments. Baskets are generally expected to be redeemed when the price per Share is at a discount to the per Share NAV. Shares initially comprising the same Basket but offered by Authorized Purchasers to the public at different times may have different offering prices. An order for one or more Baskets may be placed by an Authorized Purchaser on behalf of multiple clients. Authorized Purchasers who make deposits of cash with the Fund in exchange for Baskets receive no fees, commissions or other forms of compensation or inducement of any kind from either the Fund or the Sponsor and no such person has any obligation or responsibility to the Sponsor or the Fund to effect any sale or resale of Shares. Shares are expected to trade in the secondary market on the Exchange. Shares may trade in the secondary market at prices that are lower (i.e., a discount) or higher (i.e., a premium) relative to their NAV per Share. The amount of the discount or premium in the trading price relative to the NAV per Share may be influenced by various factors, including the number of investors who seek to purchase or sell Shares in the secondary market and the liquidity of the Fund s investments. Additional Information about the trust Description of the Trust The Trust is a Delaware Statutory Trust that was formed on February 10, 2023, by the filing of the Certificate of Trust with the Delaware Secretary of State in accordance with the provisions of the Delaware Statutory Trust Act ("DSTA"). The Trust operates pursuant to the Trust Agreement, which is the "governing instrument" of the Trust under the laws of the State of Delaware. The Fund is a separate series of the Trust. The Fund is a passively managed fund and does not pursue active management investment strategies. The Sponsor does not actively manage the assets held by the Fund, including its holding of bitcoin. The Sponsor believes that the Fund will provide a cost-efficient way for investors to implement strategic and tactical asset allocation strategies that use bitcoin by investing in the Shares rather than purchasing, holding and trading bitcoin directly, while simultaneously providing exposure to Carbon Credit Futures. The Trust is not registered as an investment company under the Investment Company Act and the Sponsor believes that the Trust is not required to register under the Investment Company Act. The Trust or, as the case may be, the Fund may dissolve at any time if the Trust is required to be registered as an investment company under the Investment Company Act. The Fund is a commodity pool for purposes of the CEA. As a result, the Fund and Sponsor are each subject to regulation thereunder. The Trust has no fixed termination date and shall terminate pursuant to the provisions of the Trust Agreement or as otherwise provided by law. Description of the Trust Agreement The following is a description of the material terms of the Trust Agreement. The Trust Agreement establishes the roles, rights and duties of the Sponsor and the Trustee. The following discussion is qualified in its entirety by reference to the Trust Agreement. Voting Rights Shareholders have no voting rights with respect to the Trust or the Fund except as expressly provided in the Trust Agreement. The Trust Agreement provides that Shareholders representing at least a majority (over 50%) of the outstanding Shares of the Fund together as a single class(excluding Shares acquired by the Sponsor in connection with its initial capital contribution to any Trust series) may vote to (i) continue the Trust by electing a successor Sponsor as described above, and (ii) approve amendments to the Trust Agreement that impair the right to surrender Redemption Baskets for redemption. (Trustee consent to any amendment to the Trust Agreement is required if the Trustee reasonably believes that such amendment adversely affects any of its rights, duties or liabilities.) In addition, Shareholders holding Shares representing seventy-five percent (75%) of the outstanding Shares of the Fund, voting together as a single class (excluding Shares acquired by the Sponsor in connection with its initial capital contribution to any Trust series) may vote to dissolve the Trust upon not less than ninety (90) days notice to the Sponsor. Liability of Covered Persons and Indemnification Under the Trust Agreement, the Sponsor, the Trustee and their respective Affiliates (collectively, "Covered Persons") shall have no liability to the Trust, the Fund, or to any Shareholder for any loss suffered by the Trust or the Fund which arises out of any action or inaction of such Covered Person if such Covered Person, in good faith, determined that such course of conduct was in the best interest of the Trust or the Fund and such course of conduct did not constitute gross negligence or willful misconduct of such Covered Person. Subject to the foregoing, neither the Sponsor nor any other Covered Person shall be personally liable for the return or repayment of all or any portion of the capital or profits of any Shareholder or assignee thereof, it being expressly agreed that any such return of capital or profits made pursuant to the Trust Agreement shall be made solely from the assets of the Fund without any rights of contribution from the Sponsor or any other Covered Person. A Covered Person shall not be liable for the conduct or willful misconduct of any administrator or other delegate selected by the Sponsor with reasonable care, provided, however, that the Trustee and its Affiliates shall not, under any circumstances be liable for the conduct or willful misconduct of any administrator or other delegate or any other person selected by the Sponsor to provide services to the Trust. The payment of any indemnification shall be allocated, as appropriate, among the Trust s series. Unless such indemnification expense is specifically attributable to a series of the Trust, or arises out of the operations of a series of the Trust, any such indemnification payment will be allocated by the Sponsor using a pro rata methodology that allocates certain Trust expenses among the Trust s series. The Trust and its series shall not incur the cost of that portion of any insurance which insures any party against any liability, the indemnification of which is prohibited under the Trust Agreement. Expenses incurred in defending a threatened or pending action, suit or proceeding against the Sponsor shall be paid by the Trust in advance of the final disposition of such action, suit or proceeding, if (i) the legal action relates to the performance of duties or services by the Sponsor on behalf of the Trust; (ii) the legal action is initiated by a party other than the Trust; and (iii) the Sponsor undertakes to repay the advanced funds with interest to the Trust in cases in which it is not entitled to indemnification. The Trust Agreement also provides that the Sponsor shall be indemnified by the Trust (or by a series separately to the extent the matter in question relates to a single series or disproportionately affects a specific series in relation to other series) against any losses, judgments, liabilities, expenses (excluding any taxes on the compensation received for services as Sponsor or on indemnity payments received), and amounts paid in settlement of any claims sustained by it in connection with its activities for the Trust, provided that (i) the Sponsor was acting on behalf of or performing services for the Trust and has determined, in good faith, that such course of conduct was in the best interests of the Trust and such liability or loss was not the result of gross negligence, willful misconduct, or a breach of the Trust Agreement on the part of the Sponsor and (ii) any such indemnification will only be recoverable from the assets of the applicable series. The Sponsor s rights to indemnification permitted under the Trust Agreement shall not be affected by the dissolution or other cessation to exist of the Sponsor, or the withdrawal, adjudication of bankruptcy or insolvency of the Sponsor, or the filing of a voluntary or involuntary petition in bankruptcy under Title 11 of the Bankruptcy Code by or against the Sponsor. Notwithstanding the above, the Sponsor shall not be indemnified for any losses, liabilities or expenses arising from or out of an alleged violation of U.S. federal or state securities laws unless (i) there has been a successful adjudication on the merits of each count involving alleged securities law violations as to the particular indemnitee and the court approves the indemnification of such expenses (including, without limitation, litigation costs), (ii) such claims have been dismissed with prejudice on the merits by a court of competent jurisdiction as to the particular indemnitee and the court approves the indemnification of such expenses (including, without limitation, litigation costs), or (iii) a court of competent jurisdiction approves a settlement of the claims against a particular indemnitee and finds that indemnification of the settlement and related costs should be made. The Trust Agreement provides that the Sponsor and the Trust shall indemnify the Trustee and its successors, assigns, legal representatives, officers, directors, Shareholders, employees, agents and servants (the "Trustee Indemnified Parties") against any liabilities, obligations, losses, damages, penalties, taxes (excluding any taxes on the compensation received for services as Trustee or on indemnity payments received), claims, actions, suits, costs, expenses or disbursements which may be imposed on a Trustee Indemnified Party relating to or arising out of the formation, operation or termination of the Trust, the execution, delivery and performance of any other agreements to which the Trust is a party, or the action or inaction of the Trustee under the Trust Agreement or any other agreement, except for expenses resulting from the gross negligence or willful misconduct of a Trustee Indemnified Party. Further, certain officers of the Sponsor are insured against liability for certain errors or omissions which an officer may incur or that may arise out of his or her capacity as such. In the event the Trust is made a party to any claim, dispute, demand or litigation or otherwise incurs any liability or expense as a result of or in connection with any Shareholder s (or assignee s) obligations or liabilities unrelated to the Trust business, such Shareholder (or assignees cumulatively) is required under the Trust Agreement to indemnify the Trust for all such liability and expense incurred, including attorneys and accountants fees. Fiduciary and Regulatory Duties of the Sponsor and the Trustee The Trust Agreement modifies and restricts the default fiduciary duties and restrictions under Delaware law typically imposed on "fiduciaries" in accordance with the DSTA. Under Delaware law, the general fiduciary duties that would apply to the Sponsor are defined and limited in scope by the Trust Agreement (to which terms all Shareholders, by purchasing Shares, are deemed to consent). That notwithstanding, the Sponsor is a registered investment adviser under the Advisers Act and is subject to the fiduciary duties associated therewith. The Trustee is a fiduciary under the Trust Agreement and must satisfy the requirements of Section 3807 of the Delaware Trust Statute. However, the fiduciary duties, responsibilities and liabilities of the Trustee are limited by, and are only those specifically set forth in, the Trust Agreement. The Trust Agreement provides that in addition to any other requirements of applicable law, a Shareholder may bring a derivative action on behalf of the Trust only if the following conditions are met: (i) the Shareholder or Shareholders must make a pre-suit demand upon the Sponsor to bring the subject action unless an effort to cause the Sponsor to bring such an action is not likely to succeed; and a demand on the Sponsor shall only be deemed not likely to succeed and therefore excused if the Sponsor has a personal financial interest in the transaction at issue, and the Sponsor shall not be deemed interested in a transaction or otherwise disqualified from ruling on the merits of a Shareholder demand by virtue of the fact that the Sponsor receives remuneration for its service as the Sponsor or as a sponsor of one or more companies that are under common management with or otherwise affiliated with the Trust; and (ii) unless a demand is not required under clause (i) of this paragraph, the Sponsor must be afforded a reasonable amount of time to consider such Shareholder request and to investigate the basis of such claim; and the Sponsor shall be entitled to retain counsel or other advisors in considering the merits of the request and may require an undertaking by the Shareholders making such request to reimburse the Trust for the expense of any such advisors in the event that the Sponsor determines not to bring such action. Actions Taken to Protect the Trust The Sponsor is authorized to and may, in its own discretion, prosecute, defend, settle or compromise actions or claims at law or in equity that it considers necessary or proper to protect the Trust or the interests of the Shareholders. The expenses incurred by the Sponsor in connection therewith (including the fees and disbursements of legal counsel) will be expenses of the Trust and are deemed to be Additional Trust Expenses. The Sponsor will be entitled to be reimbursed for the Additional Trust Expenses. Successor Sponsors If the Sponsor is adjudged bankrupt or insolvent, the Trustee may terminate and liquidate the Trust and distribute its remaining assets. Neither the Trustee nor the Administrator has any obligation to appoint a successor sponsor or to assume the duties of the Sponsor and will have no liability to any person because the Trust is or is not terminated as described in the preceding sentence. Withdrawal of the Sponsor The Sponsor may withdraw voluntarily as the Sponsor of the Trust only upon ninety (90) days prior written notice to the holders of the Trust s outstanding Shares and the Trustee. If the withdrawing Sponsor is the last remaining Sponsor, Shareholders holding a majority (over 50%) of the outstanding Shares of the Fund, voting together as a single class (not including Shares acquired by the Sponsor through its initial capital contribution) may vote to elect a successor Sponsor. The successor Sponsor will continue the business of the Trust. Shareholders have no right to remove the Sponsor. In the event of withdrawal, the Sponsor is entitled to a redemption of the Shares it acquired through its initial capital contribution to any of the series of the Trust at their NAV per Share. If the Sponsor withdraws and a successor Sponsor is named, the withdrawing Sponsor shall pay all expenses as a result of its withdrawal. Limitation on Trustee s Liability Under the Trust Agreement, the Sponsor has exclusive control of the management of all aspects of the activities of the Trust and the Trustee has only nominal duties and liabilities to the Trust. The Trustee is appointed to serve as the trustee for the sole purpose of satisfying Section 3807(a) of the DSTA which requires that the Trust have at least one trustee with a principal place of business in the State of Delaware. The duties of the Trustee are limited to (i) accepting legal process served on the Trust in the State of Delaware, (ii) the execution of any certificates required to be filed with the Delaware Secretary of State which the Trustee is required to execute under the DSTA, and (iii) any other duties specifically allocated to the Trustee in the Trust Agreement. To the extent the Trustee has duties (including fiduciary duties) and liabilities to the Trust or the Shareholders under the DSTA, such duties and liabilities will be replaced by the duties and liabilities of the Trustee expressly set forth in the Trust Agreement. The Trustee will have no obligation to supervise, nor will it be liable for, the acts or omissions of the Sponsor, Transfer Agent, Administrator, Custodians or any other person. Neither the Trustee, either in its capacity as trustee or in its individual capacity, nor any director, officer or controlling person of the Trustee is, or has any liability as, the issuer, director, officer or controlling person of the issuer of Shares. The Trustee s liability is limited solely to the express obligations of the Trustee as set forth in the Trust Agreement. Under the Trust Agreement, the Sponsor has the exclusive management, authority and control of all aspects of the activities of the Trust. The Trustee has no duty or liability to supervise or monitor the performance of the Sponsor, nor does the Trustee have any liability for the acts or omissions of the Sponsor. The existence of a trustee should not be taken as an indication of any additional level of management or supervision over the Trust. The Trust Agreement provides that the management authority with respect to the Trust is vested directly in the Sponsor. The Trust Agreement provides that the Trustee is not responsible or liable for the form, character, genuineness, sufficiency, value or validity of any of the assets of the Trust. Holding of Trust Property The Trust will hold and record the ownership of the Fund s assets in a manner such that it will be owned for the benefit of the Fund s Shareholders for the purposes of, and subject to and limited by the terms and conditions set forth in, the Trust Agreement. Other than issuance of the Shares, the Trust will not create, incur or assume any indebtedness or borrow money from or loan money to any person. The Trustee may not commingle its assets with those of any other person. The Trustee may employ agents, attorneys, accountants, auditors and nominees and will not be answerable for the conduct or misconduct of any such custodians, agents, attorneys or nominees if such custodians, agents, attorney and nominees have been selected with reasonable care. Resignation, Discharge or Removal of Trustee; Successor Trustees The Trustee may resign as Trustee by written notice of its election so to do, delivered to the Sponsor with at least 60 days notice. The Sponsor may remove the Trustee in its discretion ; provided, that such resignation shall not become effective unless and until a successor Trustee shall have been appointed by the Sponsor in accordance with Section 2.5 of the Trust Agreement. If the Trustee resigns or is removed, the Sponsor, acting on behalf of the Shareholders, shall appoint a successor trustee. The successor Trustee will become fully vested with all of the rights, powers, duties and obligations of the outgoing Trustee. Amendments to the Trust Agreement The Sponsor may, without the approval of the Shareholders, amend or supplement the Trust Agreement; provided, however, that the Shareholders shall have the right to vote on any amendment (i) if expressly required under Delaware or federal law or regulations or rules of any exchange, (ii) submitted to them by the Sponsor in its sole discretion, or (iii) approve amendments to the Trust Agreement that impair the right to surrender Redemption Baskets for redemption. The Sponsor shall provide notice of any amendment to the Shareholders setting forth the substance of the amendment and its effective date. Upon amendment of the Trust Agreement, the Certificate of Trust shall also be amended, if required by the Delaware Trust Statute, to reflect such change. No amendment shall be made to the Trust Agreement without the consent of the Trustee if it reasonably believes that such amendment adversely affects any of the rights, duties or liabilities of the Trustee. At the expense of the Sponsor, the Trustee shall execute and file any amendment to the Certificate of Trust if so directed by the Sponsor or if such amendment is required in the opinion of the Trustee. The Sponsor shall determine the contents and manner of delivery of any notice of any Trust Agreement amendment. Such notice may be provided on the Fund s website, in a prospectus supplement, through a current report on Form 8-K and/or in the Fund s annual or quarterly reports. The Trustee shall be under no obligation to execute any amendment to the Trust Agreement or to any agreement to which the Trust is a party until it has received an instruction letter from the Sponsor, in form and substance reasonably satisfactory to the Trustee (i) directing the Trustee to execute such amendment, (ii) representing and warranting to the Trustee that such execution is authorized and permitted by the terms of the Trust Agreement and (if applicable) such other agreement to which the Trust is a party and does not conflict with or violate any other agreement to which the Trust is a party and (iii) confirming that such execution and acts related thereto are covered by the indemnity provisions of the Trust Agreement in favor of the Trustee; provided that the Trustee shall in no circumstance be obligated to execute any agreement to which the Trust is a party if the Sponsor may execute such Agreement on behalf of the Trust. No provision of the Trust Agreement may be amended, waived or otherwise modified orally but only by a written instrument adopted in accordance with Section 11 of the Trust Agreement. Termination of the Trust Pursuant to the terms of the Trust Agreement, the Trust will dissolve if any of the following events occur: a certificate of dissolution or revocation of the Sponsor s charter is filed (and 90 days have passed after the date of notice to the Sponsor of revocation without a reinstatement of its charter) or upon the withdrawal, removal, adjudication or admission of bankruptcy or insolvency of the Sponsor, or an event of withdrawal unless (i) at the time there is at least one remaining Sponsor or (ii) within 90 days of such event of withdrawal Shareholders holding at least a majority of the Shares (not including Shares held by the Sponsor and its affiliates) agree in writing to continue the Trust and to select, effective as of the date of such event, one or more successor Sponsors; the occurrence of any event which would make the existence of the Trust unlawful; in the event of the suspension, revocation or termination of the Sponsor s registration as a CPO, or membership as a CPO with the CFTC or NFA (if, in either case, such registration is required at such time unless at the time there is at least one remaining Sponsor whose registration or membership has not been suspended, revoked or terminated); the Trust becomes insolvent or bankrupt; shareholders holding at least 75% of the then outstanding Shares notify the Sponsor that they elect to dissolve the Trust, written notice of which is sent to the Sponsor not less than 90 days prior to the effective date of dissolution; upon written notice to the Trustee and the Shareholders by the Sponsor, the Sponsor determines that the size of the Trust Estate in relation to the expenses of the Trust make it unreasonable or imprudent to continue the Trust; the Trust is required to be registered as an investment company under the Investment Company Act of 1940; or DTC is unable or unwilling to continue to perform its functions, and a comparable replacement is unavailable. The death, legal disability, bankruptcy, insolvency, dissolution, or withdrawal of any Shareholder (as long as such Shareholder is not the sole Shareholder of the Trust) shall not result in the termination of the Trust, and such Shareholder, his estate, custodian or personal representative shall have no right to withdraw or value such Shareholder s Shares. Each Shareholder (and any assignee thereof) expressly agrees that in the event of his death, he waives on behalf of himself and his estate, and he directs the legal representative of his estate and any person interested therein to waive the furnishing of any inventory, accounting or appraisal of the assets of the Trust and any right to an audit or examination of the books of the Trust, except for such rights as are set forth in Article IX of the Trust Agreement relating to the books of account and reports of the Trust. If the Trust is forced to liquidate, the Trust will be liquidated under the Sponsor s direction. The Sponsor will sell the Fund s bitcoin (at prices as close as practicable to the Bitcoin Price) and Carbon Credit Futures and will distribute to Shareholders any amounts of the cash proceeds in the following order of priority: (a) to the expenses of liquidation and termination and to creditors, including Shareholders who are creditors, to the extent otherwise permitted by law, in satisfaction of liabilities of the Trust other than liabilities for distributions to Shareholders and (b) to the Shareholders pro rata in accordance with the respective percentages of Shares that they hold. It is expected that the Sponsor would be subject to the same regulatory requirements as the Trust, and therefore, the markets available to the Sponsor will be the same markets available to the Trust. Under no circumstances will the Fund distribute bitcoin to Shareholders. AML/KYC The Trust takes measures with the objective of reducing illicit financing risks in connection with the Trust s activities. However, illicit financing risks are present in the digital asset markets, including markets for bitcoin. There can be no assurance that the measures employed by the Trust will prove successful in reducing illicit financing risks, and the Trust is subject to the complex illicit financing risks and vulnerabilities present in the digital asset markets. If such risks eventuate, the Trust, the Sponsor or the Trustee or their affiliates could face civil or criminal liability, fines, penalties, or other punishments, be subject to investigation, have their assets frozen, lose access to banking services or services provided by other service providers, or suffer disruptions to their operations, any of which could negatively affect the Trust s ability to operate or cause losses in value of the Shares. The Trust, the Sponsor and its affiliates have adopted and implemented policies and procedures that are designed to comply with applicable anti-money laundering laws and sanctions laws and regulations, including applicable know your customer ("KYC") laws and regulations. The Sponsor and the Trust will only interact with known third-party service providers with respect to whom the Sponsor or its affiliates have engaged in a due diligence process to ensure a thorough KYC process, such as the Authorized Purchasers, LPs, market makers, FCMs and Bitcoin Custodian. Each Authorized Purchaser, LP, and market maker must undergo onboarding by the Sponsor prior to placing creation or redemption orders with respect to the Fund. As a result, the Sponsor and the Trust have instituted procedures designed to ensure that a situation would not arise where the Trust would engage in transactions with a counterparty whose identity the Sponsor and the Trust did not know. Furthermore, Authorized Purchasers, as broker-dealers, FCMs, and Bitcoin Custodian, as an entity licensed to conduct virtual currency business activity by the New York Department of Financial Services and a limited purpose trust company subject to New York Banking Law, respectively, are "financial institutions" subject to the U.S. Bank Secrecy Act, as amended ("BSA"), and U.S. economic sanctions laws. The Trust will only accept creation and redemption requests from Authorized Purchasers, LPs, and market makers who have represented to the Trust that they have implemented compliance programs that are designed to ensure compliance with applicable sanctions and anti-money laundering laws. The Non-Digital Custodian and Bitcoin Custodian have adopted and implemented anti-money laundering and sanctions compliance programs, which provides additional protections to ensure that the Sponsor and the Trust do not transact with a sanctioned party. Governing Law; Consent to New York Jurisdiction The Trust Agreement and the rights of the Sponsor, Trustee, DTC (as registered owner of the Fund s global certificate for Shares) and Shareholders are governed by the laws of the State of Delaware, except with respect to causes of action for violations of U.S. federal, including the Securities Act and the Exchange Act, or state securities laws. The Trust Agreement and the effect of every provision thereof shall control over any contrary or limiting statutory or common law of the State of Delaware, other than the Delaware Trust Statute. The Trust Agreement does not contain an exclusive forum provision. The Bitcoin Custody Agreement and Authorized Purchaser Agreements are governed by the laws of the state of New York. The governing law for the Non-Digital Custody Agreement is the laws of the State of Minnesota. The Sponsor, the Trustee and DTC and, by accepting Shares, each DTC Participant and each Shareholder, consent to the jurisdiction of the courts of the State of New York and any federal courts located in the borough of Manhattan in New York City. plan of distribution Most investors buy and sell Shares in the secondary market through brokers. Shares trade on the Exchange under the ticker symbol "BTCK". Shares are bought and sold throughout the trading day like other publicly traded securities. When buying or selling Shares through a broker, Shareholders may incur customary brokerage commissions and/or fees. Shareholders are encouraged to review the terms of their brokerage accounts for details regarding applicable charges/fees. The Fund issues shares continuously by offering Baskets consisting of 10,000 Shares to Authorized Purchasers. Authorized Purchasers pay a transaction fee for each order they place to purchase or redeem one or more Baskets. The Sponsor believes that a Basket size of 10,000 Shares will effectively enable Authorized Purchasers to manage inventory of Shares and facilitate an effective arbitrage mechanism for the Fund. However, the Sponsor may adjust the size of the Baskets in order to improve the effectiveness of the activities of Authorized Purchasers in the secondary market for Shares if it deems it necessary or advisable to do so. The Fund does not issue fractions of a Basket. Because new Shares can be created and issued on an ongoing basis, at any point during the life of the Trust, a "distribution," as such term is used in the Securities Act, will be occurring. Authorized Purchasers, other broker-dealers and other persons are cautioned that some of their activities will result in their being deemed participants in a distribution in a manner which would render them statutory underwriters and subject them to the prospectus delivery and liability provisions of the Securities Act. For example, the initial Authorized Purchaser will be a statutory underwriter with respect to the initial purchase of Baskets. Any purchaser who purchases Shares with a view towards distribution of such Shares may be deemed to be a statutory underwriter. In addition, an Authorized Purchaser, other broker-dealer firm or its client will be deemed a statutory underwriter if it purchases a Basket from the Fund, breaks the Basket down into the constituent Shares and sells the Shares to its customers; or if it chooses to couple the creation of a supply of new Shares with an active selling effort involving solicitation of secondary market demand for the Shares. In contrast, Authorized Purchasers may engage in secondary market or other transactions in Shares that would not be deemed "underwriting." For example, an Authorized Purchaser may act in the capacity of a broker or dealer with respect to Shares that were previously distributed by other Authorized Purchasers. A determination of whether a particular market participant is an underwriter must take into account all the facts and circumstances pertaining to the activities of the broker-dealer or its client in the particular case, and the examples mentioned above should not be considered a complete description of all the activities that would lead to designation as an underwriter and subject them to the prospectus-delivery and liability provisions of the Securities Act. The offering of Baskets is being made in compliance with Conduct Rule 2310 of FINRA. Accordingly, Authorized Purchasers will not make any sales to any account over which they have discretionary authority without the prior written approval of a purchaser of Shares. Dealers that are not "underwriters" but are participating in a distribution (as contrasted to ordinary secondary trading transactions), and thus dealing with Shares that are part of an "unsold allotment" within the meaning of Section 4(3)(C) of the Securities Act, would be unable to take advantage of the prospectus delivery exemption provided by Section 4(3) of the Securities Act. An Authorized Purchaser may be indemnified by the Sponsor under certain circumstances, they will not be entitled to receive a discount or commission from the Fund or the Sponsor for their purchases of Baskets. As of the date of this prospectus, the Trust, on behalf of the Fund, has engaged Jane Street Capital, LLC, Citadel Securities LLC and Goldman Sachs & Co. LLC as Authorized Purchasers, and are the Fund s only Authorized Participants. Additional Information Regarding the Shares Book-Entry Form Individual certificates will not be issued for the Shares. Instead, one or more global certificates have been deposited by the Transfer Agent with DTC and registered in the name of Cede & Co., as nominee for DTC. The global certificates will evidence all of the Shares outstanding at any time. Under the Trust Agreement, Shareholders are limited to (1) DTC Participants such as banks, brokers, dealers and trust companies, (2) those who maintain, either directly or indirectly, a custodial relationship with a DTC Participant ("Indirect Participants"), and (3) those banks, brokers, dealers, trust companies and others who hold interests in the Shares through DTC Participants or Indirect Participants. The Shares are transferable only through the book-entry system of DTC. Shareholders who are not DTC Participants may transfer their Shares through DTC by instructing the DTC Participant holding their Shares (or by instructing the Indirect Participant or other entity through which their Shares are held) to transfer the Shares. Transfers will be made in accordance with standard securities industry practice. DTC will act as securities depository for the Shares. DTC is a limited-purpose trust company organized under the laws of the State of New York, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of section 17A of the Exchange Act. DTC was created to hold securities of DTC Participants and to facilitate the clearance and settlement of transactions in such securities among the DTC Participants through electronic book-entry changes. This eliminates the need for physical movement of securities certificates. DTC Participants include securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations, some of whom (and/or their representatives) own DTC. Access to the DTC system is also available to others such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a DTC Participant, either directly or indirectly. DTC is expected to agree with and represent to the DTC Participants that it will administer its book-entry system in accordance with its rules and by-laws and the requirements of law. The rights of the Shareholders generally must be exercised by DTC Participants acting on their behalf in accordance with the rules and procedures of DTC. Because the Shares can only be held in book-entry form through DTC and DTC Participants, investors must rely on DTC, DTC Participants and any other financial intermediary through which they hold the Shares to receive the benefits and exercise the rights described in this section. Investors should consult with their broker or financial institution to find out about procedures and requirements for securities held in book-entry form through DTC. Transfer of Shares The Shares are only transferable through the book-entry system of DTC. Shareholders who are not DTC Participants may transfer their Shares through DTC by instructing the DTC Participant holding their Shares (or by instructing the Indirect Participant or other entity through which their Shares are held) to transfer the Shares. Transfers are made in accordance with standard securities industry practice. Transfers of interests in Shares with DTC are made in accordance with the usual rules and operating procedures of DTC and the nature of the transfer. DTC has established procedures to facilitate transfers among the participants and/or account holders of DTC. Because DTC can only act on behalf of DTC Participants, who in turn act on behalf of Indirect Participants, the ability of a person or entity having an interest in a global certificate to pledge such interest to persons or entities that do not participate in DTC, or otherwise take actions in respect of such interest, may be affected by the lack of a certificate or other definitive document representing such interest. Share Splits If the Sponsor believes that the per Share price in the public market for Shares has risen or fallen outside a desirable trading price range, the Sponsor may direct the Transfer Agent to declare a split or reverse split in the number of Shares outstanding and to make a corresponding change in the number of Shares constituting a Basket. CUSTODY OF THE Fund s ASSETS General The Fund s assets will be split among two custodians. The Trust, on behalf of the Fund, intends to appoint Gemini Trust Company, LLC ("Gemini" or the "Bitcoin Custodian") for the Fund s bitcoin holdings. Separately, U.S. Bank, N.A. (the "Non-Digital Custodian" and collectively with the Bitcoin Custodian, the "Custodians") will serve as the Fund s custodian with respect to its cash and cash equivalents investments, as well as any investments in connection with its exposure to Carbon Credit Futures. The Fund may engage third-party custodians or vendors besides the Bitcoin Custodian and the Non-Digital Custodian to provide custody and security services for all or a portion of its bitcoin, cash, and investments in connection with its exposure to Carbon Credit Futures, and the Sponsor will pay the custody fees and any other expenses associated with any such third-party custodian or vendor. The Sponsor is responsible for overseeing the Bitcoin Custodian and Non-Digital Custodian, as well as the Fund s other service providers. Custody of the Fund s Non-Bitcoin Assets U.S. Bank, N.A., holds the Fund s securities, cash and/or cash equivalents pursuant to a custodial agreement in connection with the Fund s Carbon Credit Futures. The Non-Digital Custodian is located at 1555 North Rivercenter Drive, Suite 302, Milwaukee, Wisconsin 53212. U.S. Bank, N.A. is a nationally chartered bank, regulated by the Office of the Comptroller of the Currency, Department of the Treasury, and is subject to regulation by the Board of Governors of the Federal Reserve System. The principal address for Global Fund Services is 615 East Michigan Street, Milwaukee, WI, 53202. The Non-Digital Custodian will also help facilitate the movement of cash (and purchases and sales of assets associated therewith) in connection with creation and redemption of Baskets. For additional information regarding the Non-Digital Custody Agreement, see "The Fund s Service Providers—The Custodians—Non-Digital Custodian" below. Custody of the Fund s Bitcoin The Trust, on behalf of the Fund, intends to appoint Gemini for the custody of the Fund s bitcoin. The Trust, on behalf of the Fund, has entered into a custodial services agreement with Gemini (the "Bitcoin Custody Agreement"), pursuant to which the Bitcoin Custodian will custody all of the Fund s bitcoin. Pursuant to the Bitcoin Custody Agreement, the Bitcoin Custodian establishes accounts that hold the bitcoins deposited with the Bitcoin Custodian on behalf of the Fund. The Bitcoin Custody Agreement is governed by New York law. For additional information regarding the Bitcoin Custody Agreement, see "The Fund s Service Providers—The Custodian—Bitcoin Custodian" below. The Transfer Agent, in coordination with the Bitcoin Custodian and Non-Digital Custodian, will facilitate the settlement of Shares in response to the placement of creation orders and redemption orders from Authorized Purchasers. With respect to the settlement of Shares in response to the placement of creation orders and redemption orders from Authorized Purchasers, to the extent the Fund uses multiple bitcoin custodians, the Sponsor will retain discretion with respect to which of the bitcoin custodians and accompanying assets is selected to facilitate the respective order. The Sponsor may, in its sole discretion, add or terminate other bitcoin custodians. The Sponsor may, in its sole discretion, change the custodian for the Fund s bitcoin holdings, but it will have no obligation to do so or to seek any particular terms for the Fund from other such custodians. To the extent that the Sponsor adds or terminates other bitcoin custodians, or changes the custodian for the Fund bitcoin holdings, notification will be made to Shareholders via a prospectus supplement and/or a current report filed with the SEC. The Fund s Bitcoin Custodian will keep custody of all of the Fund s bitcoin in a custodial account maintained by the Bitcoin Custodian (the "Bitcoin Account") relating to its Bitcoin Account and Clearing Account. Bitcoin private keys are stored in two different forms: "hot wallet" storage, whereby the private keys are stored on secure, internet-connected devices, and "cold" storage, where digital currency private keys are stored completely offline. The Custody Agreement requires the Bitcoin Custodian to hold the Fund s bitcoin in its Bitcoin Account in cold storage, unless required to facilitate withdrawals as a temporary measure. Bitcoin temporarily held in the Clearing Account in connection with creations and redemptions or withdrawals of bitcoin to pay the Management Fee or extraordinary expenses may be held in omnibus hot storage wallets. As a fiduciary under Section 100 of the New York Banking Law, the Bitcoin Custodian is held to specific capital reserve requirements and banking compliance standards. The Bitcoin Custodian is also subject to the laws, regulations and rules of applicable governmental or regulatory authorities, including: money service business regulations under FinCEN; U.S. state money transmission laws; laws, regulations, and rules of relevant tax authorities; applicable regulations and guidance set forth by FinCEN; the Bank Secrecy Act of 1970; the USA PATRIOT Act of 2001; other anti-money laundering regulations as mandated by U.S. federal law and any other rules and regulations regarding anti-money laundering/counter-terrorist financing; issuances from the Office of Foreign Assets Control; the New York Banking Law; regulations promulgated by the New York State Department of Financial Services from time to time; the National Futures Association; the Financial Industry Regulatory Authority; and the Commodity Exchange Act. The Bitcoin Custodian provides custody, clearing/settlement, and other capital markets services specifically designed for digital asset exchange-traded funds and other fund vehicles. The Bitcoin Custodian has been providing services as a limited purpose trust company licensed by the New York State Department of Financial Services (NYSDFS) since 2015. The Bitcoin Custodian is a fiduciary under Section 100 of the New York Banking Law and a qualified custodian for purposes of Rule 206(4)-2(d)(6) under the Advisers Act, and it was the world s first digital asset platform to achieve a SOC 1 Type II and SOC 2 Type II certification for custody. Gemini Custody is also regularly audited and subject to stringent capital reserve requirements. The Bitcoin Custodian has represented to the Sponsor that it also maintains insurance coverage by a reputable insurance company with respect to digital assets custodied with Gemini, in accordance with its internal standards for maintaining such insurance and subject to change at Gemini s discretion. The Fund is not a named insured on such insurance policies and such insurance is not specific to the Fund, but the Bitcoin Custodian has represented to the Sponsor that such insurance covers events that result in a loss of digital assets belonging to customers, including the Fund. The Bitcoin Custodian will use segregated cold storage bitcoin addresses for the Fund s Bitcoin Account, which is separate from the bitcoin addresses that the Bitcoin Custodian uses for its other customers and which are directly verifiable via the bitcoin blockchain. The Bitcoin Custodian will at all times record and identify in its books and records that such bitcoins constitute the property of the Fund. The Bitcoin Custodian will not loan, hypothecate, pledge or otherwise encumber the Fund s bitcoin, as applicable, without the Fund s instruction, nor will the Sponsor or any other entity or service provider. The Fund will not lease or loan bitcoin held in the Fund s account with the Bitcoin Custodian and will not give instructions to that effect. Bitcoin Storage Structure Bitcoin private keys are stored in two different forms: "hot wallet" storage, whereby the private keys are connected to the internet, and "cold" storage, where digital currency private keys are stored completely offline. The Fund s bitcoin will be stored by the Bitcoin Custodian offline in cold storage. When under the purview of the Bitcoin Custodian, bitcoin will only enter "hot" storage in the case of creations and redemptions or withdrawals to pay the Sponsor Fee or extraordinary expenses, meaning that the bitcoin will only be in "hot" storage for a temporary period. The Bitcoin Custodian will store private keys in geographically diverse regions across the continental United States. The Bitcoin Custodian has adopted the following security policies and practices with respect to digital assets held in cold storage: HSMs are used to generate, store and manage cold storage private keys; multi-signature technology is used to provide both security against attacks and tolerance for losing access to a key or facility, eliminating single points of failure; all HSMs are stored offline in air-gapped environments within a diverse network of guarded, monitored and access-controlled facilities that are geographically distributed; multiple levels of physical security and monitoring controls are implemented to safeguard HSMs within storage facilities; and all fund transfers require the coordinated actions of multiple employees. The Bitcoin Custodian has adopted the following security policies and practices with respect to digital assets held in its hot wallet: HSMs are used to store and manage hot wallet private keys; operational redundancy is achieved through geographic disbursement of failover storage facilities and hardware, thus protecting against service disruptions and single points of failure; all hot wallet HSMs are stored within secured facilities that are access-controlled, guarded, and monitored; tiered access-controls are applied to the Bitcoin Custodian s production environment to restrict access to employees based on role, following the principle of least-privilege; administrative access to its production environment requires multi-factor authentication; and it offers additional account level protections such as crypto address whitelisting, which allows customers to restrict withdrawals to addresses only included in the customer s whitelist. The Fund will use a clearing account for the Fund (the "Clearing Account") in connection with clearing and settlement services for bitcoin purchase and sale transactions ("Clearing Services"). While the Bitcoin Custodian maintains records of the Fund s bitcoin balance in its Clearing Account, the actual bitcoin relating to the Fund s Clearing Account is held in omnibus wallets by the Bitcoin Custodian, meaning that bitcoin owned by multiple customers is held in the same wallet and at the same address on the Bitcoin Blockchain. The Fund s Clearing Account balance therefore represents an omnibus claim on the Bitcoin Custodian s bitcoins held in such wallets, and the Fund does not have an identifiable claim to specific bitcoins. The Bitcoin Custodian holds the bitcoin across a combination of omnibus hot wallets and cold wallets. The Sponsor has no control over, and the Bitcoin Custodian does not disclose to the Sponsor, the amount of bitcoin that the Bitcoin Custodian holds in connection with the Fund s Clearing Account in omnibus hot wallets, as compared to omnibus cold wallets. The Bitcoin Custodian could hold substantially all bitcoin connected to the Fund s Clearing Account in omnibus hot wallets. In addition to the Bitcoin Account and the Clearing Account, the Fund will have access to an omnibus custodial account held at depository institutions or money market funds in the Bitcoin Custodian s name for the benefit of its customers at which a cash balance may be maintained ("Fiat Account"). The Bitcoin Custodian s services in respect of the Bitcoin Account (i) allow bitcoin to be deposited from a public blockchain address to the Fund s Bitcoin Account and (ii) allow bitcoin to be withdrawn from the Bitcoin Account to a public blockchain address as instructed by the Fund. The Custody Agreement requires the Bitcoin Custodian to hold the Fund s bitcoin in cold storage, unless required to facilitate withdrawals as a temporary measure. Other than in connection with creations and redemptions and withdrawals of bitcoin to pay the Sponsor Fee and Additional Fund Expenses, where the associated bitcoin may temporarily be held in omnibus hot storage in the Clearing Account, the Bitcoin Custodian will use segregated cold storage bitcoin addresses for the Fund. The addresses on the Bitcoin Blockchain at which the Fund s bitcoin in the Bitcoin Account are held by the Bitcoin Custodian are separate from the bitcoin addresses that the Bitcoin Custodian uses for its other customers and are directly verifiable via the Bitcoin Blockchain. The Bitcoin Custodian will safeguard the private keys to the bitcoin associated with the Fund s Bitcoin Account. The Bitcoin Custodian will at all times record and identify in its books and records that such bitcoins constitute the property of the Fund. The Bitcoin Custodian will not withdraw the Fund s bitcoin from the Fund s Bitcoin Account with the Bitcoin Custodian, or loan, hypothecate, pledge or otherwise encumber the Fund s bitcoin, without the Fund s instruction, nor will the Sponsor or any other entity or service provider. The Fund will not lease or loan bitcoin held in the Fund s Bitcoin Account with the Bitcoin Custodian and will not give instructions to that effect. The Custody Agreement provides that bitcoin is deemed delivered to the address associated with the Fund s Bitcoin Account only after the required number of confirmations of the transaction on the Bitcoin Blockchain, and that Gemini has no obligations for bitcoin that is not delivered in that manner. The Custody Agreement provides that once the Fund submits a request for a withdrawal transaction, the bitcoin subject to the withdrawal request shall be delivered by the Bitcoin Custodian to the designated address on the Bitcoin Blockchain specified in the Fund s withdrawal transaction within one business day of 4:00 p.m. Eastern time of the business day on which the Fund submits the withdrawal request. If a withdrawal request is made by the Fund (i) by 4:00 p.m. Eastern time of the business day on which the Fund submits the withdrawal request, (ii) in connection with a redemption of shares of the Fund by an Authorized Participant, and (iii) the delivery of bitcoin for such withdrawal request is to the account at the Bitcoin Custodian of an Authorized Participant, then the bitcoin subject to such withdrawal request shall be delivered to the destination blockchain address specified therein, by the next business day from the business day when such withdrawal request was submitted. The Custody Agreement provides that withdrawals may be delayed in connection with scheduled maintenance ("Downtime") or the congestion or disruption of a digital asset network, including the Bitcoin Blockchain. In respect of the Fiat Account, the Bitcoin Custodian holds the Fund s cash held in its account at the Bitcoin Custodian in one or more Customer Omnibus Accounts. "Customer Omnibus Account" means, with respect to fiat currency held for customers of the Bitcoin Custodian in fiat accounts (including the Fund s cash balance in its Fiat Account), omnibus bank accounts (each an "Omnibus Account") at depository institutions (each, a "Bank") money market accounts (each, a "Money Market Account") at a Bank or financial institution and/or payment accounts (each, a "Payment Account") at a financial institution. Each Omnibus Account is: (i) in the Bitcoin Custodian s name, and under its control; (ii) separate from the Bitcoin Custodian s business, operating, and reserve bank accounts; (iii) established specifically for the benefit of the Bitcoin Custodian s customers; and (iv) represents a banking relationship, not a custodial relationship, with each Bank. Omnibus Accounts do not create or represent any relationship between the Fund and any of the Bitcoin Custodian s Banks. Each Money Market Account is held at a Bank or financial institution: (i) in the Bitcoin Custodian s name, and under its control; (ii) separate from the Bitcoin Custodian s business, operating, and reserve money market accounts; (iii) established specifically for the benefit of the Bitcoin Custodian s customers; (iv) managed by a registered financial advisor, (v) custodied by a qualified custodian; and (vi) the monies within which are used to purchase money market funds invested in securities issued or guaranteed by the United States or certain U.S. government agencies or instrumentalities. Money Market Accounts do not create or represent any relationship between the Fund and any of the related registered financial advisors and/or qualified custodians. Each Payment Account is held at a financial institution: (i) in the Bitcoin Custodian s name, and under its control; (ii) separate from the Bitcoin Custodian s business, operating, and reserve bank accounts; and (iii) established specifically for processing the fiat funds transfers of the Bitcoin Custodian s customers. Payment Accounts do not create or represent any relationship between the Fund and any of the related financial institutions. The Fund s fiat currency deposits are: (i) held across the Bitcoin Custodian s Customer Omnibus Accounts in the exact proportion that all Bitcoin Custodian customer fiat currency deposits are held across its Customer Omnibus Accounts; (ii) not treated as the Bitcoin Custodian s general assets; (iii) fully owned by the Fund; and (iv) recorded and maintained in good faith on the Bitcoin Custodian s books and records and reflected in a sub-account (i.e., the Fiat Account of the Fund s Gemini Account) so that the Fund s interests in the Bitcoin Custodian s Customer Omnibus Accounts are readily ascertainable. The Bitcoin Custodian s records permit the determination of the balance of U.S. dollars for a particular customer as a percentage of total commingled U.S. dollars held for the benefit of all of the Bitcoin Custodian s customers in all Customer Omnibus Accounts in a manner consistent with 12 C.F.R. 330.5(a)(2). The Fund is not entitled to receive any interest that may be generated with respect to the cash held in its Fiat Account. U.S. dollar deposits in the Fund s Fiat Account held in one or more Omnibus Accounts at one or more Banks located in the United States are held with the intention that they be eligible for Federal Deposit Insurance Corporation ("FDIC") "pass-through" deposit insurance, subject to the Standard Maximum Deposit Insurance Amount per FDIC regulations (currently $250,000 per eligible customer of the Bitcoin Custodian) and other applicable limitations. U.S dollar deposits held at banks or financial institutions located outside of the United States, may not be subject to or eligible for FDIC deposit insurance. The portion of the Fund s cash holdings attributable to the Fund s Fiat Account which is held at a Money Market Fund is not eligible for deposit insurance whether on a pass-through or any other basis. The Custody Agreement provides that wire deposit and withdrawal transfer times in respect of the Fiat Account are subject to bank holidays, the internal processes and jurisdiction of the Fund s bank, and the internal processes of the Bitcoin Custodian s banks and financial institutions. In certain situations, wire deposit or withdrawal transfer times may be delayed in connection with Downtime or disruptions to the Bitcoin Custodian s banks and/or affiliates or service providers. ACH deposit and withdrawal transfer times are subject to bank holidays, the internal processes and jurisdiction of the Fund s bank, and the internal processes of the Fund s banks. The Custody Agreement provides that in certain situations, ACH withdrawal transfer times may be delayed in connection with Downtime or disruptions to the Bitcoin Custodian s banks and/or affiliates or service providers. Gemini BSA/AML Program The Bitcoin Custodian has adopted the Gemini BSA/AML Program for its digital asset trading platform and custody service in an effort to maintain the highest possible compliance with applicable laws and regulations relating to anti-money laundering in the U.S. and other countries where it conducts business. This program includes robust internal policies, procedures and controls that combat any attempted use of Gemini for illegal or illicit purposes, including a customer identification program, annual training of all employees and officers in anti-money laundering regulation, filing of Suspicious Activity Reports and Currency Transaction Reports with the U.S. Financial Crimes Enforcement Network and annual internal and independent audits of the Gemini BSA/AML Program. Website Security The Bitcoin Custodian has implemented certain security policies and practices to enhance security on its website, including through the use of two-factor authentication for certain user actions, such as withdrawals; a requirement for strong passwords from its users, which are cryptographically hashed using modern standards; encryption of sensitive user information, both in transit and at rest; the application of rate-limiting procedures to certain account operations such as login attempts to thwart brute force attacks; the transmission of website data over encrypted transport layer security connections; the leveraging of content-security policy and HTTP strict transport security features in modern browsers; partnerships with enterprise vendors to mitigate-potential distributed denial-of-service attacks; and the use of separate access controls on internal-only sections of the Bitcoin Custodian s website. Internal Control In addition to the security policies and procedures discussed above, the Bitcoin Custodian has also instituted the following internal controls: multiple signatories are required to transfer funds out of cold storage; the Bitcoin Custodian s Chief Executive Officer and President are unable to individually or jointly transfer funds out of cold storage; all private keys are stored offsite in secure facilities; all employees undergo criminal and credit background checks, and are subject to ongoing background checks throughout their employment; and all remote-access by employees uses public-key authentication (e.g. no passwords, one-time passwords or other phishable credentials are used). Insurance The Bitcoin Custodian, as custodian of the Fund s bitcoin, is responsible for securing the Fund s bitcoin. As of March 1, 2024, Gemini maintains $125 million in digital asset insurance for certain types of losses, in addition to the capital reserves required of Gemini as a New York limited purpose trust company and fiduciary under New York Banking Law. This consists of $25 million of commercial crime insurance for digital assets held in its hot storage system, and $100 million of offline (cold storage system) insurance coverage for assets held. The Bitcoin Custodian has represented to the Fund applies to all customer assets held at the Bitcoin Custodian, including the Fund s assets. Such insurance is shared with other customers and is not specific to the Fund. The Fund is not a named beneficiary under the Bitcoin Custodian s insurance policies, though the Bitcoin Custodian has represented to the Sponsor that the insurance covers customer losses, including losses suffered by the Fund, arising from specified events, including fraud, theft, and cyber-security breaches. The amounts and continuing availability of this coverage are subject to change at the Bitcoin Custodian s sole discretion. The Bitcoin Custodian also maintains separate commercial crime insurance coverage for digital assets custodied in its "hot wallet". To date, the Bitcoin Custodian has never experienced a loss due to unauthorized access from its hot wallet or the cold storage vaults. Each Bitcoin Trading Counterparty is required to maintain a Bitcoin Trading Counterparty bitcoin account at the Fund s Bitcoin Custodian. The Fund s Transfer Agent will facilitate the settlement of Shares in response to the placement of creation orders and redemption orders from Authorized Participants. The Fund generally does not intend to hold cash or cash equivalents except in connection with cash creation and redemption orders. However, there may be situations where the Fund will unexpectedly hold cash on a temporary basis. THE Fund s Service providers The Sponsor The Sponsor is Tidal Investments LLC (f/k/a Toroso Investments LLC), a Delaware limited liability company. The Sponsor s principal place of business is 234 West Florida Street, Suite 203, Milwaukee, Wisconsin 53204. The Sponsor arranged for the creation of the Trust and the Fund and is responsible for the ongoing registration of the Shares for their public offering in the U.S. and the listing of Shares on the Exchange. The Sponsor serves as the Fund s CPO and is registered as a CPO and a CTA with the CFTC. Tidal services over 175 ETFs with over $26 billion in assets across a diverse range of investment strategies. Our leadership team brings a wealth of expertise, with over 300 years of combined ETF industry experience. We have more than 75 specialized professionals dedicated to helping our clients successfully launch, manage, and grow ETFs. Our services include trust management, trading, capital markets, product development, fund administration, accounting, legal, compliance, and marketing. Tidal has been a leader in the Digital Assets space since 2015, beginning as early investors in GBTC, one of the first products to provide Bitcoin exposure. In 2018, Tidal became the sub-advisor for BLOK, an innovative, actively managed ETF focused on blockchain technology, which broke new ground by being the first ETF to allocate to spot Bitcoin ETFs. This commitment to innovation continued in 2024, when Tidal partnered with Hashdex to successfully convert their Bitcoin futures ETF into a spot Bitcoin ETF, further advancing accessibility to digital asset investments. As consideration for its receipt of the Management Fee from the Fund, the Sponsor is obligated to pay the Sponsor-paid Expenses. The Sponsor also paid the costs of the Fund s organization and will pay for the costs of the initial sale of the Shares. The Sponsor has agreed to pay certain operating expenses out of the Sponsor s unified management fee. The Fund is responsible for the payment of any litigation expenses, other extraordinary expenses, and any transaction-based costs or expenses (e.g., brokerage commissions or mark-ups). For the Sponsor s services, the Fund is contractually obligated to pay a monthly management fee to the Sponsor, based on average daily net assets, at a rate equal to 0.68% per annum. The Fund is newly organized and as of the date of this prospectus has not paid any management fees to the Sponsor. The Sponsor is generally responsible for the administration of the Fund pursuant to the authorities granted to it under the Trust Agreement. This includes (i) selecting and monitoring the Fund s Service Providers and from time to time engaging additional, successor or replacement Service Providers and (ii) upon dissolution of the Fund, distributing the Fund s assets (or the value of such assets, when liquidated) on a pro rata basis to the Shareholders in accordance with their Shares. In addition to the foregoing, the Sponsor is responsible for management and conducts or directs the conduct of the business of the Trust, the Fund, and any series the Trust that may from time to time be established and designated by the Sponsor. The Sponsor has the authority to oversee the purchase and sale of Shares by Authorized Purchasers and to manage the Fund s investments, including to evaluate the credit risk of FCMs and to review daily positions and margin/collateral requirements. The Sponsor has the power to enter into agreements as may be necessary or appropriate for the offer and sale of the Fund s Shares and the conduct of the Trust s activities. The following is a biographical summary of the business experience of each of the Executive Officers the Sponsor, all of whom are members of the Sponsor: Mr. Guillermo Trias, born in 1976, has served as the Co-Founder and CEO of Tidal Investments LLC since November 1, 2015. In his role, he oversees the overall strategic direction, management, and operational aspects of the firm s ETF investment platforms. Mr. Trias was approved as a Principal of the Sponsor by the NFA on February 7, 2022. He holds a Business Administration degree from CUNEF and an MBA from the Kellogg School of Management at Northwestern University. Mr. Michael Venuto, born in 1977, has been the Chief Investment Officer at Tidal Investments LLC since March 12, 2012. His responsibilities at Tidal include the strategic planning and execution of ETF-based investment strategies, focusing on innovation and market responsiveness. Mr. Venuto was approved as a Principal of the Sponsor by the NFA on February 25, 2022. Mr. Dan Carlson, born in 1955, has been the CFO at Tidal Investments LLC since March 12, 2012, and served as CCO from March 12, 2012 to March 31, 2023. His responsibilities involve managing the company s financial operations and overseeing financial planning. He holds a BS degree in Accounting from the University of Illinois, Champaign-Urbana. Mr. Carlson was approved as a Principal of the Sponsor by the NFA on February 7, 2022. Mr. Eric Falkeis, born in 1973, has been the Chief Growth Officer at Tidal Investments LLC since November 1, 2018, and co-founded Tidal ETF Services. His role at Tidal involves leading business development and growth strategy initiatives. Mr. Falkeis is a CPA and holds a BS degree in Accounting from Marquette University. As of the date of this prospectus, his application to be listed as a Principal of the Sponsor is currently pending with the NFA. Mr. Gavin Filmore, born in 1984, joined Tidal Investments LLC as the Head of Product Development in August 2021 and was promoted to COO in July 2022. Before joining Tidal, he worked at Barclays Investment Bank, a leading global investment bank offering services in investment management, wealth management, and corporate banking, from August 2017 to September 2021. His focus at Barclays was on Exchange Traded Products. Mr. Filmore holds a BS in Finance from Northeastern University. He was approved as a Principal of Tidal Investments LLC and registered as an Associated Person of the Sponsor by the NFA on March 8, 2022. Mr. William Woolverton, born in 1951, has been the Chief Compliance Officer of Tidal Investments LLC, Tidal ETF Trust, and Tidal Trust II since November 10, 2022. Prior to joining Tidal, he was a Senior Principal Consultant at ACA Group, a firm specializing in governance, risk, and compliance services for financial institutions, from March 2020 to October 2022. Before ACA Group, Mr. Woolverton served as Managing Director - US at Waystone, a company offering comprehensive fund governance, risk, compliance, and administration services to the asset management industry, from April 2016 to December 2019. Mr. Woolverton received his M.A. from King s College, Cambridge University, and a law degree from Columbia University School of Law. He was approved as a Principal of the Sponsor by the NFA on April 5, 2023. The following are individual Principals, as that term is defined in CFTC Rule 3.1, of Tidal Investments LLC: Messrs. Michael Venuto, Guillermo Trias and Daniel Carlson. Their status as principals is primarily due to their ownership interests in the Sponsor. Mr. Trias, in particular, holds his interest through GT Capital Advisors LLC, a company he owns and manages, which has over 10% ownership stake in the Sponsor, thereby establishing GT Capital Advisors LLC as a principal of the sponsor under CFTC regulations. Additionally, FTV Toroso Inc. is identified as a principal of Sponsor under CFTC Rules due to its ownership interest exceeding 10% in the Sponsor. Mr. Falkeis qualifies as a principal under CFTC Rule 3.1 due to his role as Chief Operating Officer. On March 11, 2024, Mr. Eric Falkeis submitted an application to be listed as a Principal of the Sponsor. As of the date of this prospectus, Mr. Falkeis application is pending with the NFA. The Trustee Wilmington Trust, National Association, a national banking association, serves as Delaware trustee of the Trust under the Trust Agreement. The Trustee has its principal office at 1100 North Market Street, Wilmington, Delaware 19890-0001. The Trustee is unaffiliated with the Sponsor. A copy of the Trust Agreement is available for inspection at the Trustee s principal office identified above. The Trustee s Role The Trustee will accept service of legal process on the Trust in the State of Delaware and will make certain filings under the DSTA. The Trustee does not owe any other duties to the Trust, the Sponsor or the Shareholders. Under the Trust Agreement, the Trustee has delegated to the Sponsor the exclusive management and control of all aspects of the business of the Trust and the Fund. The Trustee has no duty or liability to supervise or monitor the performance of the Sponsor, nor does the Trustee have any liability for the acts or omissions of the Sponsor. The Trustee has not signed the registration statement of which this prospectus is a part and is not subject to issuer liability under the federal securities laws for the information contained in this prospectus and under federal securities laws with respect to the issuance and sale of the Shares. Under such laws, neither the Trustee, either in its capacity as Trustee or in its individual capacity, nor any director, officer or controlling person of the Trustee is, or has any liability as, the issuer or a director, officer or controlling person of the issuer of the Shares. Because the Trustee has no authority over the Trust s operations, the Trustee itself is not registered in any capacity with the CFTC. The Trust Agreement provides that the Trustee is entitled to reasonable compensation for its services from the Sponsor or an affiliate of the Sponsor (including the Trust), and is indemnified by the Sponsor against any expenses it incurs relating to or arising out of the formation, operation or termination of the Trust, or any action or inaction of the Trustee under the Trust Agreement, except to the extent that such expenses result from the fraud, or the gross negligence or willful misconduct of the Trustee. The Sponsor has the discretion to replace the Trustee. The Trustee is permitted to resign upon at least sixty (60) days notice to the Sponsor. If no successor trustee has been appointed by the Sponsor within such sixty-day period, the Trustee may, at the expense of the Trust, petition a court to appoint a successor. The Trustee s fees and expenses under the Trust Agreement will be paid by the Sponsor. The Administrator The Administrator of the Fund is Tidal ETF Services pursuant to the Fund Administration Servicing Agreement. The Administrator has its principal office at 234 West Florida Street, Suite 203, Milwaukee, Wisconsin 53204. The Administrator is a wholly-owned subsidiary of the Sponsor. In turn, the Administrator has engaged U.S. Bancorp Fund Services, LLC, doing business as U.S. Bank Global Fund Services ("Global Fund Services") to act as sub-administrator. The Administrator is a wholly-owned subsidiary of Sponsor. The Administrator also assists the Fund and the Sponsor with certain functions and duties relating to marketing, which include the following: marketing and sales strategy, and marketing related services. Fund Administration Servicing Agreement. Under the Fund Administration Servicing Agreement, the Administrator assists with overall operation of the funds, acts as a liaison among service providers, assists with regulatory compliance, and preparation of certain regulatory and financial reports. Under the Fund Administration Servicing Agreement, the Trust shall indemnify and hold harmless the Administrator from and against any and all claims, demands, losses, expenses, and liabilities of any and every nature (including reasonable attorneys fees) the Administrator may sustain or incur or that may be asserted against Administrator by any person arising out of any action taken or omitted to be taken by it in performing the services hereunder (i) in accordance with the foregoing standards, or (ii) in reliance upon any written or oral instruction provided to Administrator by any duly authorized officer of the Trust or the Sponsor, except for any and all claims, demands, losses, expenses, and liabilities arising out of or relating to Administrator s refusal or failure to comply with the terms of this Fund Administration Servicing Agreement or from its bad faith, negligence or willful misconduct in the performance of its duties under this Fund Administration Servicing Agreement. The Fund Administration Servicing Agreement will continue in effect for a period of three years and may be terminated by any party upon giving 90 days prior written notice to the other parties or such shorter period as is mutually agreed upon by the parties. The governing law for the agreement is the State of Wisconsin. The Transfer Agent, Sub-Administrator and Fund Accountant U.S. Bank Global Fund Services ("Global Fund Services"), an entity affiliated with U.S. Bank, N.A., is the registrar and transfer agent for the Fund s Shares. In addition, Global Fund Services also serves as sub-administrator for the Fund, performing certain sub-administrative, and accounting services, and support in preparing certain SEC and CFTC reports on behalf of the Fund. The principal address for Global Fund Services is 615 East Michigan Street, Milwaukee, WI, 53202. The Transfer Agent holds the Shares in book-entry form. The Administrator directs the Transfer Agent to credit or debit the number of Creation Baskets or Redemption Baskets to the applicable Authorized Purchaser. The Transfer Agent will issue or cancel each Authorized Purchaser s Creation Basket or Redemption Basket, as applicable. The Transfer Agent will also assist with the preparation of Shareholders account and tax statements. The Transfer Agent Fee is a Sponsor-paid Expense to be assumed and paid by the Sponsor. Sub-Administration Agreement. The Fund Sub-Administrator is U.S. Bancorp Fund Services, LLC, doing business as U.S. Bank Global Fund Services (Global Fund Services). In the Fund Administration Servicing Agreement with the Trust and the Sponsor, Global Fund Services has been appointed to provide a range of administrative services to the Trust. These services encompass general fund management, financial reporting, tax reporting, and optional additional tax services, as detailed in the Agreement. The agreement specifies an initial term of three years, with automatic renewal for successive one-year periods unless a party provides 90 days prior written notice indicating non-renewal. Termination can occur under several conditions, including material breach, compliance with applicable laws, or operational changes that affect Global Fund Services or the Trust. Additionally, the Agreement may be amended only through a written agreement executed by both parties. The agreement limits the Global Fund Services liability to direct damages arising from Global Fund Services refusal or failure to comply with the terms of the agreement or from its bad faith, negligence or willful misconduct in the performance of its duties under the agreement. The Trust is required to indemnify Global Fund Services against losses or liabilities incurred in performing its duties, except in cases of failure to meet the standard of care or due to the Fund Administrator s own misconduct. Conversely, Global Fund Services is obligated to indemnify the Trust against any liabilities arising from Global Fund Services refusal or failure to comply with the terms of the Agreement or from its bad faith, negligence or willful misconduct in the performance of its duties under this Agreement. The agreement is governed by the laws of the State of Wisconsin. Both parties agree to maintain confidentiality regarding proprietary information, with allowances for disclosure as required by law or upon mutual agreement. Transfer Agent Servicing Agreement. The Transfer Agent Servicing Agreement is between Global Fund Services, a registered transfer agent under the Exchange Act, the Trust and the Sponsor. Under this agreement Global Fund Services is appointed as the transfer agent for the Trust, providing services related to the creation and redemption of shares, dividend disbursing, and maintaining shareholder records. Global Fund Services is responsible for facilitating purchases and redemptions of Creation Units, handling transactions with Authorized Participants, managing dividend payments for the Trust s shares. Global Fund Services also records issuance of shares and maintains a record of outstanding shares for each fund in the Trust. Global Fund Services is obligated to exercise reasonable care. Its liability is limited to direct damages arising from Global Fund Services refusal or failure to comply with the terms of the agreement or from its bad faith, negligence or willful misconduct in the performance of its duties under this agreement. The Trust is obligated to indemnify Global Fund Services against claims not arising from the agent s non-compliance or misconduct. Global Fund Services is required to implement its designed to promote the detection and reporting of potential money laundering activity and identity theft by monitoring certain aspects of shareholder activity as well as written procedures for verifying a customer s identity. The Transfer Agent Agreement has an initial three-year term, automatically renewing for one-year periods unless terminated by a party upon 90 days written notice. Early termination requires the Trust to pay remaining fees and costs related to the transition to a new service provider. This agreement includes clauses on confidentiality, proprietary information, and record-keeping responsibilities, ensuring both parties maintain confidentiality of sensitive information and is governed by the laws of the State of Wisconsin. Fund Accounting Agreement. The Fund Accounting Servicing Agreement is between Global Fund Services, the Trust, and the Sponsor. Under this Agreement, Global Fund Services is appointed as the fund accountant for the Trust, responsible for various accounting services such as portfolio accounting, expense accrual and payment, trust valuation and financial reporting, tax accounting, and compliance control services. The Agreement is set for an initial term of three years, with automatic renewal for successive one-year terms unless terminated earlier. Termination can occur under specific conditions, including material breach or changes in laws affecting the Agreement. The Trust and Sponsor can also terminate the agreement upon 90 days notice, and Global Fund Services may do the same under certain circumstances, such as the existence of certain legal compliance issues or reputational harm. Global Fund Services is obligated to exercise reasonable care in its duties. Global Fund Services liability under the agreement limited to losses arising from Global Fund Services refusal or failure to comply with the terms of the agreement or from its bad faith, negligence or willful misconduct in the performance of its duties under this agreement. The Trust is obligated to indemnify Global Fund Services against losses not arising from such failures or misconduct. Conversely, Global Fund Services is obligated to indemnify the Trust for losses resulting from its non-compliance or misconduct. The agreement includes clauses on confidentiality, proprietary information, and record-keeping responsibilities, ensuring both parties maintain confidentiality of sensitive information. The agreement has an initial three-year term, automatically renewing for one-year periods unless terminated by a party upon 90 days written notice and is governed by the laws of the State of Wisconsin. The Custodians The Fund s assets will be split among two custodians. The Trust, on behalf of the Fund, intends to appoint Gemini Trust Company, LLC for the Fund s bitcoin holdings. Separately, U.S. Bank, N.A., will serve as the Fund s custodian with respect to its cash and cash equivalents investments, as well as any investments in connection with its exposure to Carbon Credit Futures. Bitcoin Custodian Gemini Trust Company, LLC serves as the Fund s Bitcoin Custodian, pursuant to its custodial agreement, to hold a portion of the Fund s bitcoin in accordance with the procedures outlined above in the section "Custody of the Fund s Assets". Gemini Trust Company, LLC has its principal offices at 315 Park Ave South, Floor 16, New York, NY 10010. Gemini s a fiduciary under 100 of the New York Banking Law. The Bitcoin Custodian is authorized to serve as the Fund s custodian under the Trust Agreement and pursuant to the terms and provisions of the Custody Agreement. In designating a custodian as a bitcoin custodian for the Fund, the Sponsor considers whether the custodian provides protection against theft and loss and ensures that the transactions and trades are secure. The Sponsor may consider whether a custodian: 1. Provides custody accounts whose holders are the legal beneficiaries of the assets held in the account. In case of bankruptcy or insolvency of a Bitcoin Custodian, creditors or the estate should have no rights to the clients assets. 2. Offers segregated accounts and stores the Fund s bitcoin in separated individual accounts and not in omnibus accounts. That means that The Fund s bitcoin shall be held in segregated wallets and therefore are not commingled with the Bitcoin Custodian s or other customer assets. 3. Generates account-segregated private keys for digital assets using high entropy random number generation methods and employing advanced security practices. 4. Utilizes technology for storing private keys in offline digital vaults and applies secure processes, such as private key segmentation, multi-signature authorization, and geographic distribution of stored assets, to limit access to private keys. The Bitcoin Custodian should use security technology for storing private keys aiming to avoid theft or misappropriation of assets due to online attacks, collusion of agents managing the storage services, or any other threat. 5. Has a comprehensive risk management policy and formalized framework of managing operational and custody risks, including a disaster recovery program that ensures continuity of operations in the event of a system failure. The Bitcoin Custodian shall have a business continuity plan to help ensure continued access to the Fund s assets. 6. Has an insurance policy that covers, at least partially, risks such as the loss of client assets held in cold storage, including from employee collusion or fraud, physical loss including theft, damage of key material, security breach or hack, and fraudulent transfer. 7. Complies with higher standards of government oversight, external audits, and security, and as such, Bitcoin Custodian is able to offer better legal guarantees that safekeep asset ownership. The Bitcoin Custodian may be licensed or registered as a custodian by a reputable and independent governing body (e.g., the New York State Department of Financial Services, or other state, national or international regulators), as can be ascertained by certain public data sources. 8. Provides third-party audit reports at least annually on operational and security processes. This audit may be completed by having a Systems and Organizational Control certification ("SOC") issued. Auditors provide reasonable assurance that the Bitcoin Custodian operational processes and private key management controls are in accordance with the expected standards. A custodian may lose its eligibility as a Bitcoin Custodian if it fails to comply with the above requirements, but the Sponsor has no obligation whatsoever to change the Bitcoin Custodian for the Fund s bitcoin holdings. The Bitcoin Custodian may also employ advanced blockchain monitoring tools and services to ensure the security and compliance of incoming transactions, including: 1. Transaction Validation: When a transaction is initiated, these monitoring tools immediately validate it against predefined criteria, including sender addresses, transaction amounts, and transaction details, to ensure they comply with the custodian s policies and regulatory requirements. 2. Real-time Alerts: These monitoring tools offer real-time alerting capabilities, using advanced algorithms to identify suspicious or potentially fraudulent transactions. They detect patterns that may indicate money laundering, fraud, or other illicit activities. 3. AML/KYC Compliance: To comply with Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations, custodians integrate these solutions to verify sender and receiver identities, ensuring transactions are conducted by legitimate parties and meeting regulatory requirements. The Sponsor has evaluated the Bitcoin Custodian s policies, procedures, and controls for safekeeping, exclusively possessing, and controlling the Fund s bitcoin holdings and believes these are designed consistent with accepted industry practices to protect against theft, loss, and unauthorized and accidental use of the private keys. Notwithstanding the Sponsor s evaluation, the Sponsor does not control Bitcoin Custodian s operations or implementation of such policies, procedures and controls and there can be no assurance that they will actually work as designed or prove to be successful in safeguarding the Fund s assets against all possible sources of theft, loss or damage. Bitcoin Custody Agreement. The Trust, on behalf of the Fund, has entered into a custodial services agreement with the Bitcoin Custodian. The Bitcoin Custodian agrees to take reasonable care and use commercially reasonable efforts in executing its responsibilities to the Trust pursuant to the Bitcoin Custody Agreement, which includes exercising the degree of care, diligence and skill that a prudent and competent professional provider of services similar to the services contemplated by the Bitcoin Custody Agreement would exercise in the circumstances, or such higher care where required by law or the Bitcoin Custody Agreement (collectively, the "Standard of Care"). The Bitcoin Custodian cannot be held responsible for any failure or delay to act by the Bitcoin Custodian, its affiliates or service providers, or its banks that is within the time limits permitted by the Bitcoin Custody Agreement, or that is caused by the Fund s negligence or is required to comply with applicable laws and regulations. The Bitcoin Custodian cannot be held responsible for any Downtime or System Failure (defined below), which prevents the Bitcoin Custodian from fulfilling its obligations under the Bitcoin Custody Agreement, provided that Bitcoin Custodian took reasonable care and used commercially reasonable efforts to prevent or limit such System Failures or Downtime and otherwise complied with this Agreement. The Bitcoin Custody Agreement provides that a "System Failure" shall mean a failure of any computer hardware, software, computer systems, or telecommunications lines or devices used by Bitcoin Custodian, or interruption, loss, or malfunction of utility, data center, Internet or network provider services used by Bitcoin Custodian; provided, however, that a cybersecurity attack, data breach, hack, or other intrusion, or unauthorized disclosure by a third party, Bitcoin Custodian, a Bitcoin Custodian affiliate or service provider, or an agent or subcontractor of Bitcoin Custodian, shall not be deemed a System Failure, to the extent such events or any losses arising therefrom are due to Bitcoin Custodian s failure to comply with its obligations under the Bitcoin Custody Agreement. The Bitcoin Custodian cannot be held responsible for any circumstances beyond the Bitcoin Custodian s reasonable control, provided Bitcoin Custodian acted in accordance with the Standard of Care. Notwithstanding any other provision in the Bitcoin Custody Agreement, for the Fund s bitcoin held in the Bitcoin Account, the Bitcoin Custodian represents, warrants, and covenants that it will maintain the private key or keys in a form accessible to the Bitcoin Custodian and will take reasonable care and use commercially reasonable efforts to (i) protect and keep the private key or keys secure and (ii) not disclose them or allow access to them by any other person. The Bitcoin Custodian shall take reasonable care and use commercially reasonable efforts to ensure that the Trust shall be able to access the Bitcoin Account via the Bitcoin Custodian s online interface 97% of the time excluding Downtime and System Failures. The Bitcoin Custodian shall not, without the prior written consent of the Trust, deposit or hold the Fund s bitcoin with any third-party depositary, custodian, clearance system, wallet, or sub-custodian. Subject to the foregoing, the Bitcoin Custodian is permitted to perform its obligations under the Bitcoin Custody Agreement using subcontractors or agents, provided that, in relation to each such subcontractor or agent used by the Bitcoin Custodian, the Bitcoin Custodian shall: (i) comply with the Standard of Care in the selection, appointment and use of each such subcontractor or agent; (ii) monitor such subcontractor s or agent s performance; and (iii) remain solely liable to Trust for the performance of the Bitcoin Custodian s obligations under the Bitcoin Custody Agreement, notwithstanding any use of subcontractors or agents. The Bitcoin Custody Agreement provides that no more than once per calendar year, the Trust shall be entitled to request that the Bitcoin Custodian produce its Services Organization Controls 2 Type I report (a "SOC 2-I Report") and a new Services Organization Controls 2 Type II report (a "SOC 2-II Report" and, together with a SOC 2-I Report, "SOC Reports"), or certify that there have been no material changes which would impact the previous SOC Reports provided to the Trust, and promptly deliver to the Trust a copy of each SOC Report within 45 days of the Trust s request. No more than once per calendar year, the Trust shall be entitled to request that the Bitcoin Custodian produce a copy of the Bitcoin Custodian s audited annual financial statements for each financial year ending on or after December 31, 2021, and the Bitcoin Custodian shall promptly deliver such financial statements to the Trust. Subject to the "Force Majeure" provision (defined below) and as limited by the limitations of liability in the Bitcoin Custody Agreement, the Bitcoin Custodian shall be liable to the Trust for the Loss (defined below) of any of the Fund s bitcoin or fiat currency to the extent that such Loss was caused by the negligence, fraud, willful or reckless misconduct of the Bitcoin Custodian or breach by the Bitcoin Custodian of its Standard of Care. The Bitcoin Custody Agreement provides that "Loss" means if, at any time the Fund s bitcoin Account or Fiat Account, as applicable, does not hold the bitcoin or fiat currency that had been (1) received by Bitcoin Custodian in connection with the Fund s bitcoin Account or Fiat Account pursuant to the Bitcoin Custody Agreement, or (2) duly sent to the Bitcoin Custodian by the Trust or Authorized Participants in connection with the Fund s bitcoin Account pursuant to the Bitcoin Custody Agreement but not received because of a failure caused by the Bitcoin Custodian. The Bitcoin Custody Agreement provides that "Loss" shall include situations where the Bitcoin Custodian fails to execute a valid withdrawal request, bitcoin are withdrawn from the Fund s bitcoin Account other than pursuant to a withdrawal request, or the Trust is not able to timely withdraw bitcoin from the Bitcoin Account pursuant to a withdrawal request, in each case due to a failure caused by the Bitcoin Custodian; provided, however, that the Bitcoin Custodian s failure to permit timely withdrawals because it has determined that it cannot do so due to the requirements of applicable laws and regulations or because of the operation of its fraud detection controls shall not be considered a Loss, provided the Bitcoin Custodian is acting reasonably and in good faith. The Bitcoin Custody Agreement provides that should a Loss of the Fund s bitcoin or fiat currency due to the negligence, fraud, willful or reckless misconduct of the Bitcoin Custodian or a breach by the Bitcoin Custodian of its Standard of Care occur, the Bitcoin Custodian will, as soon as practicable, return to the Trust a quantity of the same digital asset that is equal to the quantity of digital assets involved in the Loss, or return to the Trust a quantity of the same fiat currency that is equal to the quantity of fiat currency involved in the Loss (if the Loss involved the Fiat Account). The Bitcoin Custody Agreement provides that (i) the Bitcoin Custodian does not own or control the underlying software protocols of networks which govern the operation of digital assets (including the Bitcoin Blockchain), (ii) the Bitcoin Custodian makes no guarantees regarding their security, functionality, or availability, and (iii) in no event shall the Bitcoin Custodian be liable for or in connection with any acts, decisions, or omissions made by developers or promoters of digital assets, including bitcoin. The Bitcoin Custody Agreement s "Force Majeure" provision provides that in no event shall the Bitcoin Custodian be liable for any delays, failure in performance or interruption of service which result directly or indirectly from any cause or condition, whether or not foreseeable, beyond the Bitcoin Custodian s reasonable control, including, but not limited to, any act of God, nuclear or natural disaster, epidemic, action or inaction of civil or military authorities, act of war, terrorism, sabotage, civil disturbance, strike or other labor dispute, accident, or state of emergency; provided, however, that for the avoidance of doubt, the Bitcoin Custody Agreement s Force Majeure provision shall not apply in respect of System Failures or Downtime, which are subject to other respective provisions of the Bitcoin Custody Agreement. The occurrence of an event described in the Force Majeure provision shall not affect the validity and enforceability of any remaining provisions of the Bitcoin Custody Agreement. Under the Bitcoin Custody Agreement, each of the Bitcoin Custodian and the Trust has agreed to indemnify and hold harmless the other party from any third-party claim or third-party demand (including reasonable attorneys fees and expenses) (collectively, "Damages") arising out of or related to the Bitcoin Custodian s or the Trust s, as the case may be, non-performance of its obligations under or material breach of the Bitcoin Custody Agreement and inaccuracy in any of the Bitcoin Custodian s or the Trust s, as the case may be, representations or warranties in the Bitcoin Custody Agreement. In addition, the Bitcoin Custodian agrees to indemnify the Trust in the event of Damages relating to the holding of the Fund s bitcoin and fiat currency by the Bitcoin Custodian as contemplated by the Bitcoin Custody Agreement, including any loss or damage caused by any act or omission of any employee of the Bitcoin Custodian or any agent, representative or independent contractor engaged by the Bitcoin Custodian, whether or not such act or omission occurred within the scope of his employment or engagement. The Bitcoin Custody Agreement provides that "Damages" shall not include any losses, claims, damages, liabilities or expenses arising from any fluctuation in market price, forks, governance changes, airdrops or other events which impact all holders of a digital asset such as bitcoin globally as a class. The Bitcoin Custody Agreement provides the Bitcoin Custodian, its affiliates, service providers, or any of their respective officers, directors, agents, joint venturers, employees or representatives, shall not be liable for (i) any losses or claims arising out of actions that are in the Trust s control and related to its use of the Bitcoin Custodian s online platform, including but not limited to, the Trust s failure to follow security protocols, the Bitcoin Custodian s controls, improper instructions, failure to secure the Trust s credentials from third parties, or anything else in the Trust s control and (ii) any amount greater than the value of the bitcoin on deposit in the Fund s bitcoin Account at the time of, and directly relating to, the events giving rise to the liability occurred, the value of which shall be determined in accordance with the Chicago Mercantile Exchange Bitcoin Reference Rate or any successor thereto. No party shall be liable to the other parties (whether under contract, tort (including negligence) or otherwise) for any indirect, incidental, special, punitive or consequential losses suffered or incurred by the other parties (whether or not any such losses were foreseeable or within the contemplation of the parties). This means, by way of example only (and without limiting the scope of the above), that if the Trust claims that the Bitcoin Custodian failed to process a withdrawal request properly, the Trust s damages are limited to no more than the value of the bitcoin at issue in the withdrawal request, and that the Trust may not recover for lost profits, lost business opportunities, or other types of special, incidental, indirect, intangible, or consequential damages in excess of the value of the bitcoin at issue in the withdrawal. The Bitcoin Custodian shall not be liable to the Trust or anyone else for any loss or injury resulting directly or indirectly from any damage or interruptions caused by any computer viruses, spyware, scamware, trojan horses, worms, or other malware that may affect the Trust s computer or other equipment, provided such malware did not originate from the Bitcoin Custodian or its agents. The Bitcoin Custody Agreement provides that the Bitcoin Custodian has obtained insurance coverage by a reputable insurance company with respect to digital assets custodied with the Bitcoin Custodian, in accordance with its internal standards for maintaining such insurance and subject to change at the Bitcoin Custodian s discretion. The Bitcoin Custody Agreement provides that the Bitcoin Custodian shall provide the Trust with notice of material changes in its insurance coverage. The Bitcoin Custody Agreement will commence on the date of execution and continue until terminated in accordance with its provisions. The Bitcoin Custody Agreement may be terminated by either party upon 90 days written notice to the other party; provided, however, that if the Bitcoin Custody Agreement is terminated, the Bitcoin Custodian shall use commercially reasonable efforts to cooperate with the Trust s transition to a replacement custodian and if the Trust is unable to engage a replacement custodian using commercially reasonable efforts within such 90 day period, the Bitcoin Custodian terminates the Bitcoin Custody Agreement, then the Bitcoin Custodian shall continue to act as Bitcoin Custodian pursuant to the terms of the Bitcoin Custody Agreement until such time as the Trust engages a replacement custodian, provided that the Trust uses reasonable commercial efforts to promptly engage a replacement custodian. Either party (the "Terminating Party") may terminate the Bitcoin Custody Agreement at any time on written notice to the other party (the "Defaulting Party"), such termination to take effect (i) on the tenth business day after the delivery of written notice of termination by the Terminating Party to the Defaulting Party, unless the Defaulting Party has cured the event triggering a termination right to the satisfaction of the Terminating Party, acting reasonably, or (ii) immediately after delivery of written notice of termination by the Terminating Party to the Defaulting Party if the event triggering a termination right is incapable of being cured within ten business days, in the following circumstances. First, any representation, warranty, certification or statement made by the Defaulting Party under the Bitcoin Custody Agreement was or becomes incorrect in any material respect when made; second, the Defaulting Party materially breaches, or fails in any material respect to perform any of its obligations under, the Bitcoin Custody Agreement; third, the Defaulting Party requests a postponement of maturity or a moratorium with respect to any indebtedness or is adjudged bankrupt or insolvent, or there is commenced against the Defaulting Party a case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or the Defaulting Party files a petition for bankruptcy or an application for an arrangement with its creditors, seeks or consents to the appointment of a receiver, administrator or other similar official for all or any substantial part of its property, admits in writing its inability to pay its debts as they mature, or takes any corporate action in furtherance of any of the foregoing, or fails to meet applicable legal minimum capital requirements; fourth, a Change of Control (as defined in the Bitcoin Custody Agreement) of the Defaulting Party, or an event, change or development that causes or is likely to cause a Material Adverse Effect (as defined in the Bitcoin Custody Agreement) on the Defaulting Party, or in the ability of the Defaulting Party to fulfill its responsibilities under the Bitcoin Custody Agreement, occurs; fifth, with respect to the Trust s right to terminate, the Bitcoin Blockchain undergoes a fork and becomes a forked network, and the Trust disagrees with the Bitcoin Custodian s choice of which forked network to support; or with respect to the Trust s right to terminate, applicable laws and regulations or any change therein or in the interpretation or administration thereof that may have a Material Adverse Effect (as defined in the Bitcoin Custody Agreement) on the Trust or the rights of the Trust with respect to any services covered by the Bitcoin Custody Agreement. The Bitcoin Custodian has the right to immediately (i) take actions the Bitcoin Custodian determines appropriate to comply with applicable law and regulations and in accordance with its Bank Secrecy Act and Anti-Money Laundering compliance program ("BSA/AML Program"), (ii) suspend the Fund s bitcoin Account or Fiat Account, (iii) freeze/lock the funds and assets in all such accounts, and (iv) suspend the Trust s access to the Bitcoin Custodian s platform or its account there (collectively, an "account suspension"), if: (A) the Bitcoin Custodian is required to do so by a regulatory authority, court order, facially valid subpoena, or binding order of a governmental authority, (B) the Bitcoin Custodian reasonably and in good faith believes the Trust has violated applicable laws and regulations in connection with the Fund s bitcoin Account or Fiat Account, or the Bitcoin Custodian is required to do so under the Bitcoin Custodian s BSA/AML Program, (C) the Bitcoin Custodian believes someone is attempting to gain unauthorized access to the account, or (D) the Bitcoin Custodian believes there is unusual activity in the account. Except as set forth above, the Bitcoin Custodian shall not suspend the Trust s access to the Bitcoin Account or the Fiat Account, and any suspension of the Trust s access to such accounts shall constitute a breach of the Bitcoin Custody Agreement. In the case of an account suspension due to (C) or (D) of this paragraph, the Bitcoin Custodian shall restore the Trust s normal access to the Bitcoin Account or Fiat Account as promptly as reasonably possible without putting the bitcoin and fiat currency in such accounts at risk. In the case of an account suspension due to (A) or (B) of this paragraph, the Bitcoin Custodian shall permit the Trust to withdraw the Fund s bitcoin and fiat currencies from Bitcoin Account or Fiat Account as soon as permitted by applicable laws and regulations or the applicable court order, subpoena, or regulatory or governmental authority, and for ninety (90) days thereafter. Non-Digital Custodian In its capacity as the Non-Digital Custodian, currently U.S. Bank, N.A., holds the Fund s securities, cash and/or cash equivalents pursuant to a custodial agreement. The Non-Digital Custodian is located at 1555 North Rivercenter Drive, Suite 302, Milwaukee, Wisconsin 53212. U.S. Bank, N.A. is a nationally chartered bank, regulated by the Office of the Comptroller of the Currency, Department of the Treasury, and is subject to regulation by the Board of Governors of the Federal Reserve System. Non-Digital Custody Agreement. Under the Non-Digital Custody Agreement between the Non-Digital Custodian, Sponsor, and the Trust, upon the Sponsor s instructions, the Non-Digital Custodian will establish and maintain a segregated account or accounts for and on behalf of a Fund, into which account or accounts may be transferred cash and/or securities. Upon instructions from the Trust or Sponsor, the Non-Digital Custodian will facilitate the transfer and management of assets, including cash, within the Trust s account(s). The Non-Digital Custodian s fees are payable by the Trust, however, the Sponsor assumes such fees via the Sponsorship Agreement with the Trust. The Non-Digital Custody Agreement specifies an initial term of three years, with automatic renewal for successive one-year terms unless terminated earlier in accordance with the terms of the Agreement. Either party can terminate the Agreement under certain conditions, such as material breach or failure to pay fees within a specified period. Additionally, the Agreement may be terminated by the Trust for causes such as prolonged force majeure events, legal requirements, or significant corporate events affecting the Non-Digital Custodian. In performing its duties, the Non-Digital Custodian is required to exercise due care in accordance with reasonable commercial standards. The Non-Digital Custodian is generally not liable for any error of judgment or mistake of law or for any loss suffered by the Trust in connection with its duties under the Agreement, except a loss arising out of or relating to the Custodian s refusal or failure to comply with the terms of the Agreement or from the Custodian s bad faith, negligence or willful misconduct in the performance of its duties under this Agreement. Liability of the Non-Digital Custodian under the Agreement is generally limited to direct damages caused by its failure to perform its obligations in accordance with the agreed standard of care. The Trust is obligated to indemnify the Non-Digital Custodian against losses, expenses, damages, and liabilities incurred in the performance of its duties under the Agreement, except where such issues arise from the Non-Digital Custodian s failure to meet the agreed standard of care. The Trust retains the discretion to appoint additional custodians as necessary to manage its assets, subject to the terms of separate agreements. The Sponsor has the authority to add or terminate Custodians as deemed appropriate. The governing law for the Non-Digital Custody Agreement is the laws of the State of Minnesota. The Fund is subject to various risks associated with the potential insolvency of the Non-Digital Custodian. In the event of the Non-Digital Custodian s insolvency, the Fund s assets held under custody might be subject to legal and financial complexities, which would subject the Fund to the following risks: Access to Assets: In the case of the Non-Digital Custodian s insolvency, there may be delays or difficulties in accessing the Fund s assets held by the Non-Digital Custodian. This situation could impact the Fund s ability to meet its financial obligations or to execute its investment strategies promptly. Asset Recovery and Transfer: The process of recovering and transferring assets to a new custodian in the event of insolvency may prove time-consuming and complex. This process might involve legal proceedings and negotiations, potentially leading to a prolonged period during which the assets are not actively managed or are inaccessible. Financial Losses: The Fund may incur financial losses if the assets held by the Non-Digital Custodian are entangled in insolvency proceedings. The Fund might not recover the full value of its assets, particularly if any part of the assets becomes part of the Non-Digital Custodian s bankruptcy estate. Operational Disruptions: Transitioning to a new custodian may cause operational disruptions. This includes administrative burdens, potential errors during the transfer of records and assets, and the need to establish new operational protocols. In addition to the foregoing risks, the Fund would be subject to additional risks if the Custody Agreement is terminated, which include: Cost Implications: Terminating the agreement and engaging a new custodian might incur additional costs, including early termination fees, transfer fees, and higher fees charged by a new custodian. Continuity of Service: There is a risk of service interruptions during the transition period, which might affect the Fund s ability to execute transactions and manage its assets effectively. Marketing Agent The Fund employs Foreside Fund Services, LLC, a wholly-owned subsidiary of Foreside Financial Group, LLC (d/b/a ACA Group) as the Marketing Agent for the Fund. The Marketing Agent s principal business address is Three Canal Plaza, Suite 100, Portland, Maine 04101. The Marketing Agent Agreement among the Marketing Agent, the Sponsor, and the Trust calls for the Marketing Agent to work with the Cash Custodian in connection with the receipt and processing of orders for Creation Baskets and Redemption Baskets and the review and approval of all Fund sales literature and advertising material. The Marketing Agent is a broker-dealer registered with the U.S. Securities and Exchange Commission ("SEC") and a member of FINRA. Marketing Agent Agreement. Under the Marketing Agent Agreement, the Trust engaged the Marketing Agent to perform marketing services. The Marketing Agent is registered as a broker-dealer under the Securities Exchange Act of 1934 and a member of FINRA. The Marketing Agent s services include assisting with Authorized Participant Agreements, maintaining creation and redemption order confirmations, providing Prospectuses to Authorized Participants, ensuring compliance with SEC and FINRA advertising rules, and approving marketing materials. The Trust, in turn, is responsible for creating, issuing, and redeeming Creation Units, providing the Marketing Agent with necessary documentation, and ensuring the availability of Prospectuses and Statements of Additional Information. The Trust is obligated to indemnify the Marketing Agent against losses arising from its breach of obligations or non-compliance with laws, except for losses resulting from the Marketing Agent s provision of inaccurate information. Conversely, the Marketing Agent will indemnify the Trust for losses arising from its breach of the agreement or failure to comply with applicable laws. The agreement sets out that the Marketing Agent is not entitled to compensation or reimbursement of expenses from the Trust, with any such remuneration to be paid by the Sponsor under a separate agreement (the Marketing Agent Services Agreement). The term of the agreement is two years, with provisions for automatic renewal and termination options available to both parties. Confidential information is protected under the agreement, with specific obligations for non-disclosure and non-use, along with provisions for regulatory disclosure and information security. The agreement is governed by Delaware law. Bitcoin Advisers 7RCC Global Inc. ("7RCC") serves as a "Bitcoin Adviser" to the Fund. 7RCC has its principal offices at 90 Alton Rd, Suite 1105, Miami Beach, FL 33139. 7RCC, established in 2021, is an alternative investment manager specializing in bridging the digital asset industry with environmentally conscious investment strategies. The firm focuses on developing innovative financial products that align with Environmental, Social, and Governance principles, catering to investors seeking sustainable investment opportunities. The team at 7RCC comprises professionals with extensive backgrounds in financial markets, blockchain technology, and sustainable investment practices. Their collective expertise enables the firm to design and manage investment products that align with both financial performance and environmental responsibility. As Bitcoin Adviser, 7RCC is responsible for providing the Sponsor and Administrator with research and analysis regarding bitcoin, the bitcoin markets and carbon neutralization structures for use in the operation and marketing of the Fund. The Bitcoin Adviser does not have any responsibility for the investment or management of the Fund s portfolio or for the overall performance or operation of the Fund. Support Agreement The Sponsor, Tidal, and 7RCC (collectively, the "Parties") have entered into an agreement, as amended (the "Support Agreement") that sets forth the terms and conditions applicable to the launch, marketing, promotion, development, and ongoing operation of the Fund, as well the respective rights in profits and obligations for expenses. Specifically, 7RCC and the Sponsor have experience in the digital asset and exchange-traded fund industry, and seek to offer a fund offering bitcoin and Carbon Credit Futures exposure as part of their long-term business goals. The primary responsibilities and rights of each Party under the Support Agreement, with respect to the Fund are described below: The Sponsor will serve as the sponsor of the Fund as a series of the Trust, as described in this prospectus. Administrator will provide fund administration and related services for the Fund. 7RCC will provide to the Sponsor research and analysis regarding bitcoin and bitcoin markets for use in the operation and marketing of the Fund. After a deduction of operational costs from the Management Fee, 7RCC will receive the benefit of any resulting profits and will be responsible for paying any losses. Pursuant to the Support Agreement, 7RCC receives remaining proceeds generated from the Management Fee after the payment of the Fund s expenses. The Support Agreement terminates at the earlier of: (1) the withdrawal of the Registration Statement; (2) 30 days after an uncured material breach by a party to the Support Agreement; (3) upon ninety (90) days prior written notice by a party to the other parties (or such lesser period of time as may be necessary pursuant to law, rule, regulation or court order) if any legislation or regulation is adopted or any government interpretation is issued that prevents that party from fulfilling any of its material obligations contained in the Support Agreement; or (iv) upon the parties mutual written agreement. Commodity Trading Advisor Currently, the Sponsor does not employ commodity trading advisors for the Fund. If, in the future, the Sponsor does employ commodity trading advisors, it will choose each advisor based on arm s length negotiations and will consider the advisor s experience, fees, and reputation. Clearing Brokers StoneX Financial Inc. – FCM Division (f/k/a INTL FCStone Financial Inc. - FCM Division) ("StoneX") serves as the Fund s clearing brokers (the "Clearing Broker") to execute and clear the Fund s futures transactions and provide other futures brokerage-related services. The Clearing Broker is registered as an FCM with the CFTC, is a member of the National Futures Association ("NFA") and is a clearing member of all major U.S. futures exchanges. The Clearing Broker is also a registered as broker-dealer with the SEC and is a member of FINRA Except as indicated below, there have been no material civil, administrative, or criminal proceedings pending, on appeal, or concluded against the Clearing Brokers or their principals in the past five (5) years. Litigation Disclosure for StoneX. Listed below are material administrative, civil, enforcement, or criminal complaints or actions filed against StoneX Financial Inc. – FCM Division (f/k/a INTL FCStone Financial Inc. - FCM Division) where such complaints or actions have not concluded and any material enforcement actions or complaints filed against the StoneX Financial Inc. - FCM Division in the past three years. On March 16, 2023, the Clearing House Risk Committee at CME Group found that StoneX Financial, Inc. violated Customer Gross Margining Technical Overview Requirements and CME Rule 980.G. Pursuant to an offer of settlement in which StoneX Financial, Inc. neither admitted nor denied the rule violations upon which the penalty is based, the Clearing House Risk Committee imposed a $100,000.00 fine which was effective on March 16, 2023. On January 20, 2023, the Clearing House Risk Committee at CME Group found that StoneX Financial Inc. violated CME Rules 930.A and 930.F. Pursuant to an offer of settlement in which StoneX Financial, Inc. neither admitted nor denied the rule violations upon which the penalty is based, the Clearing House Risk Committee imposed a $50,000 fine which was effective on January 20, 2023. On December 15, 2022, the Market Regulation Department of CME notified StoneX Financial Inc. ("SFI") that it was conducting a formal investigation into block trades placed in September 2022 that could potentially be in violation of CME Rule 526 and Market Regulation Advisory Notice RA2004-5R. On July 6, 2023, CME notified SFI that it has referred the case to Market Regulation s Enforcement Division. Settlement negotiations are ongoing. On July 20, 2022, a subcommittee on the ICE Future US s Business Conduct Committee determined that in numerous instances between May 2020 and May 2021 StoneX Financial Inc. and StoneX Markets LLC may have violated Exchange Rule 4.04 by engaging in improper pre-hedging and adopting a risk policy that may have motivated employees to engage in improper pre-hedging for certain contracts. In addition, the Committee found that StoneX Financial Inc. and StoneX Markets LLC may have violated Exchange Rules 4.01(a), 4.07(c), and 21.04. In accordance with the settlement offer, in which StoneX Financial Inc. and StoneX Markets LLC neither admitted nor denied the alleged rule violations, StoneX Financial Inc. and StoneX Markets LLC agreed to pay a collective monetary penalty of $425,000 and disgorge $225,606.80 in profits. On March 23, 2021, a subcommittee of the ICE Futures US s Business Conduct Committee determined that in numerous instances between February 2019 and May 2020, StoneX Financial Inc. ("StoneX"), formerly INTL FCStone Financial Inc., may have violated Exchange Rule 6.15(a) by failing to submit to the Exchange daily large trader reports on reportable customer positions and Exchange Rule 4.01(a) by failing to have proper processes for reporting large trader positions. The ICE Futures US Business Conduct Committee imposed a $75,000 fine on StoneX Financial Inc. which was effective on March 23, 2021. After a historic move in the natural gas market in November of 2018, INTL FCStone Financial Inc. – FCM Division ("IFF") experienced a number of customer deficits. IFF soon thereafter initiated NFA arbitrations, seeking to collect these debits, and has also been countersued and sued in a number of these arbitrations. These accounts were managed by Optionsellers.com, ("Optionsellers") who is a Commodity Trading Advisor ("CTA") authorized by investors to act as attorney-in-fact with exclusive trading authority over these investors trading accounts. These accounts cleared through IFF. After this significant and historic natural gas market movement, the accounts declined below required maintenance margin levels. IFF s role in managing the accounts was limited. As a clearing firm, IFF did not provide any investment advice, trading advice, or recommendations to customers of Optionsellers who chose to clear with IFF. Instead, it simply executed and cleared trades placed by Optionsellers on behalf of Optionsellers customers. Optionsellers is a CFTC registered CTA operating under a CFTC Rule 4.7 exemption from registration. Optionsellers engaged in a strategy that primarily involved selling options on futures products. The arbitrations between IFF, Optionsellers, and the Optionsellers customers are currently ongoing. Further, StoneX Financial Inc. is subject to litigation and regulatory enforcement in the normal course of business. Except as discussed above, the current or pending civil litigation or administrative proceedings in which StoneX Financial Inc. is involved are not expected to have a material effect upon its condition, financial or otherwise. StoneX Financial Inc. vigorously defends, as a matter of policy, civil litigation, reparation, arbitration proceedings, and enforcement actions brought against it. AUTHORIZED Purchasers An Authorized Purchaser must enter into an "Authorized Purchaser Agreement" with the Sponsor and the Trust, on behalf of the Fund, to govern its placement of orders to create and redeem Baskets. The Authorized Purchaser Agreement sets forth the procedures for the creation and redemption of Baskets. The Authorized Purchaser Agreement also provides the Sponsor and the Administrator with the authority to terminate the relationship with an Authorized Purchaser if the Sponsor or Administrator determines that an Authorized Purchaser does not to comply with the regulatory and registration requirements promulgated by FinCEN or other state authorities. Each Authorized Purchaser must (i) be a registered broker-dealer and (ii) enter into an Authorized Purchaser Agreement with the Sponsor, the Administrator and the Marketing Agent. A list of the current Authorized Purchasers can be obtained from the Sponsor. The Trust, on behalf of the Fund, has engaged Jane Street Capital, LLC, Citadel Securities LLC and Goldman Sachs & Co. LLC as Authorized Purchasers. JSCT, LLC (an affiliate of Jane Street Capital, LLC) is also a Bitcoin Trading Counterparty of the Fund. Additional Authorized Purchasers may be added at any time, subject to the discretion of the Sponsor. CALCULATION OF NAV Calculating the Fund s NAV per Share The Fund s NAV per Share is calculated by: taking the current market value of its total assets; subtracting any liabilities; and dividing that total by the total number of outstanding Shares. The Administrator calculates the NAV of the Fund once each trading day. It will calculate the NAV as of the earlier of the close of the Exchange or 4:00 p.m. (ET). The NAV for a normal trading day will be released after 4:00 p.m. (ET). To the extent there are any determinations that the Sponsor and the Administrator make, such determinations will be made in good faith upon the basis of, and neither the Sponsor nor the Administrator will be liable for any errors contained in, information reasonably available. Neither the Sponsor nor the Administrator will be liable to The Depository Trust Company ("DTC"), Authorized Purchasers, the Shareholders or any other person for errors in judgment. The Fund s daily activities are generally not reflected in the NAV determined for the Business Day on which the transactions are effected (the trade date), but rather on the following Business Day. The Sponsor has the exclusive authority to determine the NAV of the Fund. The Sponsor has delegated to the Administrator the responsibility to calculate the NAV and NAV per Share of the Fund, based on a pricing source selected by the Sponsor. The Administrator will determine the NAV of the Fund each business day. In determining the NAV of the Fund, the Administrator values the bitcoin held by the Fund based on the Bitcoin Price calculated by the Index, unless otherwise determined by the Sponsor in its sole discretion. See "Investment Objective and Investment Strategies—Principal Investment Strategies—Bitcoin Valuation" for additional information regarding the calculation methodology of the Bitcoin Price. If the Bitcoin Price is not available or the Sponsor in its sole discretion determines that the Bitcoin price should not be used, the Fund s holdings may be fair valued in accordance with the policy approved by the Sponsor. The Sponsor does not anticipate the need to "fair value" bitcoin will be a common occurrence. The Administrator will value the Fund s Carbon Credit Futures using the same methodology of the Index (and respective Sub-index), as detailed in the "Investment Objective and Investment Strategies—Principal Investment Strategies—The Index—Carbon Credit Futures Sub-indexes" subsection on page [ ]. Specifically, the EU CEA Carbon Credit Futures will be valued with the settlement price at closing on the primary trading exchange. The CCA Carbon Credit Futures and RGGI Carbon Credit Futures will be valued at the last trading price as of 4:00 pm ET. If the Sponsor in its sole discretion determines that the this price does not reflect the accurate value of a given Carbon Credit Future, then the Sponsor will instruct the Administrator to employ an alternative method to determine the fair value of the Fund s assets. In determining an alternative fair value method, the Sponsor may consider such criteria as observable market-based inputs, including market quotations and/or trading platforms on which Carbon Credit Futures are traded. The Sponsor does not anticipate that the need to "fair value" bitcoin or Carbon Credit Futures will be a common occurrence. Valuation of the Fund s Assets As discussed above, value of bitcoin is determined by the value that various market participants place on bitcoin through their transactions. On exchanges, bitcoin is traded with publicly disclosed valuations for each executed trade, measured by one or more fiat currencies such as the U.S. dollar. The Fund values the bitcoin held by the Fund based on the Bitcoin Price calculated by the Index for purposes of NAV. The Index requires each digital asset trading platform used to calculate the price of bitcoin to meet certain criteria, and the exchanges qualifying under such criteria are used to calculate the Bitcoin Price. Kaiko reviews the time-weighted average price between 3:00 pm and 4:00 pm ET and values bitcoin as the median value amongst the eligible platforms. The Sponsor believes this methodology provides a reasonable valuation of the spot price of bitcoin that is reasonably resistant to price manipulation of bitcoin. The value of the futures contracts held by the Fund will be based on market prices as of the time the NAV is calculated on each trading day. The Sponsor may determine to a price used for one or more of the futures contracts utilized by the Fund may need to be fair valued in accordance with the policy approved by the Sponsor. The Sponsor will monitor for significant events related to crypto assets that may impact the value of bitcoin and will determine in good faith, and in accordance with its valuation policies and procedures, whether to fair value the Fund s bitcoin and/or Carbon Credit Futures on a given day (e.g., if an Index Pricing Source or price of a Carbon Credit Future is not available). In certain circumstances, the Sponsor will determine whether to fair value the Fund s assets (bitcoin or Carbon Credit Futures) on a given day on whether certain pre-determined criteria have been met. For example, the Sponsor may fair value the Fund s bitcoin or Carbon Credit Futures using observed market transactions from one or more exchanges. The Sponsor may also fair value the Fund s bitcoin using a combination of inputs in certain situations (e.g., using observed market transactions, OTC quotations from brokers, etc.). Accordingly, the NAV of the Fund may reflect the fair value of bitcoin or Carbon Credit Futures rather than market prices on certain exchanges at 4:00 p.m. ET. Fair value pricing involves subjective judgments and it is possible that a fair value determination for bitcoin or Carbon Credit Futures may be materially different than the value that could be realized upon the sale of such bitcoin or Carbon Credit Future. In addition, fair value pricing could result in a difference between the prices used to calculate the Fund s NAV and the prices used by the Index (i.e., the Bitcoin Price and/or prices for the Carbon Credit Futures). The Sponsor, in conjunction with the Administrator, will work in good faith to determine the fair value and implement the correct pricing for the Fund s NAV. Intraday Indicative Value The NAV for a normal trading day will be released after 4:00 p.m. ET. Trading during the core trading session on the Exchange typically closes at 4:00 p.m. ET. However, NAVs are not officially struck until later in the day. In order to provide updated information relating to the Fund for use by Shareholders and market professionals, ICE Data Services, will calculate and disseminate throughout the core trading session on each trading day an updated intraday indicative value ("IIV"). ICE Data Services, will disseminate the IIV value through the facilities of CTA/CQ High Speed Lines. In addition, the indicative fund value will be published on the Exchange s website and will be available through on-line information services such as Bloomberg and Reuters. The IIV will be calculated by using the prior day s closing NAV per Share of the Fund as a base and updating that value throughout the trading day to reflect changes in the most recently reported price level of the Fund s bitcoin and Carbon Credit Futures during the trading day. The Fund s bitcoin holdings will be priced using the Blockstream Crypto Data Fees Streaming Level 1 as the pricing source. The Fund s Carbon Credit Futures will be priced using the last traded price for each contract on the relevant exchange for such Carbon Credit Future. Such last traded price will be obtained via the ICE Data Services Consolidated Feed. Changes in the value of cash equivalents are not included in the calculation of indicative value. For this and other reasons, the indicative fund value disseminated during Exchange hours should not be viewed as an actual real time update of the NAV. NAV is calculated only once at the end of each trading day. The IIV disseminated during the Exchange core trading session hours should not be viewed as an actual real time update of the NAV, because NAV per Share is calculated only once at the end of each trading day based upon the relevant end of day values of the Fund s investments. The IIV will be disseminated on a per Share basis, as calculated by a third-party financial data provider, every 15 seconds during regular Exchange core trading session hours of 9:30 a.m. ET to 4:00 p.m. ET by one or more major market vendors. The IIV may differ from the NAV due to the differences in the time window of trades used to calculate each price (the NAV uses a sixty-minute window, whereas the IIV draws prices from the last trade on each exchange in an effort to produce a relevant, real-time price). The Sponsor does not believe this will cause confusion in the marketplace, as Authorized Purchasers are the only Shareholders who interact with the NAV and the Sponsor will communicate its NAV calculation methodology clearly. There are many instances in the market today where the IIV and the NAV of an ETF are subtly different, whether due to the calculation methodology, market hours overlap or other factors. The Sponsor has seen limited or no negative impact on trading, liquidity or other factors for exchange-traded funds in this situation. The Sponsor believes that the IIV will closely track the globally integrated bitcoin price as reflected on the contributing Bitcoin Platforms. Dissemination of the IIV provides additional information that is not otherwise available to the public and is useful to Shareholders and market professionals in connection with the trading of the Fund s Shares on the Exchange. Shareholders and market professionals will be able throughout the trading day to compare the market price of the Fund and the IIV. If the market price of the Fund s Shares diverges significantly from the IIV, market professionals will have an incentive to execute arbitrage trades. For example, if the Fund appears to be trading at a discount compared to the IIV, a market professional could buy the Fund s Shares on the Exchange and sell short futures contracts. Such arbitrage trades can tighten the tracking between the market price of the Fund and the IIV and thus can be beneficial to all market participants. Calculation of Principal Market NAV and Principal Market NAV per Share The Fund s periodic financial statements may not utilize the NAV of the Fund determined by reference to the Index to the extent the methodology used to calculate the Bitcoin Price is deemed not to be consistent with GAAP. The Fund s periodic financial statements will be prepared in accordance with the Financial Accounting Standards Board ("FASB") Accounting Standards Codification Topic 820, "Fair Value Measurements and Disclosures" ("ASC Topic 820") and utilize an exchange-traded price from the Fund s principal market for bitcoin on the Fund s financial statement measurement date. The Sponsor will determine in its sole discretion the valuation sources and policies used to prepare the Fund s financial statements in accordance with GAAP. The Fund intends to engage a third-party vendor to obtain a price from a principal market for bitcoin, which will be determined and designated by such third-party vendor daily based on its consideration of several exchange characteristics, including oversight, and the volume and frequency of trades. Under GAAP, such a price is expected to be deemed a Level 1 input in accordance with the ASC Topic 820 because it is expected to be a quoted price in active markets for identical assets or liabilities. To determine which market is the Fund s principal market (or in the absence of a principal market, the most advantageous market) for purposes of calculating the Fund s financial statements, the Fund follows ASC 820-10, which outlines the application of fair value accounting. ASC 820-10 determines fair value to be the price that would be received for bitcoin in a current sale, which assumes an orderly transaction between market participants on the measurement date. ASC 820-10 requires the Fund to assume that bitcoin is sold in its principal market to market participants or, in the absence of a principal market, the most advantageous market. Market participants are defined as buyers and sellers in the principal or most advantageous market that are independent, knowledgeable, and willing and able to transact. The Fund may transact through Bitcoin Trading Counterparties, in multiple markets, and its application of ASC 820-10 reflects this fact. The Fund anticipates that, while multiple venues and types of markets will be available to the Bitcoin Trading Counterparties from whom the Sponsor acquires or disposes of the Fund s bitcoin, the principal market in each scenario is determined by looking at the market-based level of volume and bitcoin trading activity. Bitcoin Trading Counterparties, may transact in a Brokered Market, a Dealer Market, Principal-to-Principal Markets and Exchange Markets, each as defined in the FASB ASC Master Glossary. The Fund determines its principal market (or in the absence of a principal market the most advantageous market) on a quarterly basis to determine which market is its Principal Market for the purpose of calculating fair value for the creation of quarterly and annual financial statements. The process that the Sponsor has developed for identifying a principal market, as prescribed in ASC 820-10, which outlines the application of fair value accounting. The process begins by identifying publicly available, well established and reputable bitcoin trading venues (Exchange Markets, as defined in the FASB ASC Master Glossary), which are selected by the Sponsor and its affiliates in their sole discretion. The Sponsor then, through a service provider, calculates on each valuation period, the highest volume venue during the 60 minute period prior to 4:00 ET for bitcoin. The Sponsor then identifies that market as the principal market for bitcoin during that period, and uses the price for bitcoin from that venue at 4:00 ET as the principal market price. conflicts of interest General There are present and potential future conflicts of interest in the Trust s structure and operation you should consider before you purchase Shares. The Sponsor may use this notice of conflicts as a defense against any claim or other proceeding made. The Sponsor s principals, managers, officers and employees, do not devote their time exclusively to the Fund. Notwithstanding obligations and expectations related to the management of the Sponsor, the Sponsor s principals, officers and employees may be directors, officers or employees of other entities, and may manage assets of other entities, including the other funds of the Trust, through the Sponsor or otherwise. As a result, the principals could have a conflict between responsibilities to the Fund on the one hand and to those other entities on the other. The Sponsor and its principals, officers and employees may trade securities, futures and related contracts for their own accounts, creating the potential for preferential treatment of their own accounts. Shareholders will not be permitted to inspect the trading records of such persons, or any written policies of the Sponsor related to such trading. A conflict of interest may exist if their trades are in the same markets and at approximately the same times as the trades for the Fund. A potential conflict also may occur when the Sponsor s principals trade their accounts more aggressively or take positions in their accounts that are opposite, or ahead of, the positions taken by the Fund. The Sponsor has sole current authority to manage the investments and operations of the Fund, and this may allow it to act in a way that furthers its own interests which may create a conflict with your best interests, including the authority of the Sponsor to allocate expenses to and between the funds of the Trust. Shareholders have very limited voting rights with respect to the Fund, which will limit the ability to influence matters such as amendment of the Trust Agreement, change in the Fund s basic investment policies, or dissolution of the Fund or the Trust. The Sponsor serves as the Sponsor to the Fund and serves as the sponsor or investment adviser to investment companies and commodity pools other than the Fund. The Sponsor may have a conflict to the extent that its trading decisions for the Fund may be influenced by the effect they would have on the other investment companies or pools it manages. In addition, the Sponsor may be required to indemnify the officers and directors of the other investment companies or pools, if the need for indemnification arises. This potential indemnification will cause the Sponsor s assets to decrease. If the Sponsor s other sources of income are not sufficient to compensate for the indemnification, it could cease operations, which could in turn result in Fund losses and/or termination of the Fund. There are present and potential future conflicts of interest in the Fund s structure and operation you should consider before you purchase Shares. The Sponsor will use this notice of conflicts as a defense against any claim or other proceeding made. If the Sponsor is not able to resolve these conflicts of interest adequately, it may impact the Fund s ability to achieve its investment objectives. The officers, directors and employees of the Sponsor do not devote their time exclusively to the Fund. These persons are directors, officers or employees of other entities, or otherwise work in respect of other clients, which may compete with the Fund for their services. They could have a conflict between their responsibilities to the Fund and to those other entities. If the Sponsor acquires knowledge of a potential transaction or arrangement that may be an opportunity for the Fund, it shall have no duty to offer such opportunity to the Fund. The Sponsor will not be liable to the Fund or the Shareholders for breach of any fiduciary or other duty if the Sponsor pursues such opportunity or directs it to another person or does not communicate such opportunity to the Fund and is not required to share income or profits derived from such business ventures with the Fund. The Sponsor might have a potential future conflict of interest if the Sponsor, a new sponsor, or sub-adviser were to register as a broker-dealer or become affiliated with a broker-dealer. In such case, the Sponsor, new sponsor, or sub-adviser, as the case may be, would develop and implement appropriate procedures designed to prevent the use and dissemination of material non-public information regarding the Fund s holdings. Under its code of ethics (the "COE"), the Sponsor and its affiliates are required to adhere to a series of prescribed steps prior to engaging in trading activities, including transactions involving the Fund s Shares or bitcoin futures contracts. The preliminary step requires employees to seek pre-clearance for any trade in Covered Securities, which is a broad category encompassing various financial instruments, including stocks, bonds, and derivatives such as bitcoin futures. This pre-clearance is obtained by submitting a detailed request via an online Compliance Portal, which is then reviewed by the Sponsor s Chief Compliance Officer ("CCO") or designee. The COE specifies certain transactions that require heightened oversight, including participation in initial public offerings ("IPOs"), secondary offerings, and private placements. Employees must obtain not just pre-clearance but also direct approval from the CCO for such activities. Furthermore, the code strictly prohibits trading based on non-public, material information, commonly known as front-running, to prevent any potential conflicts with client interests and maintain the integrity of client transactions. Reporting is another critical aspect of the COE. Employees are mandated to file detailed reports of their trading activities on a quarterly basis, as well as annual reports detailing their holdings. These reports are subject to review by the CCO to identify any potential or actual conflicts of interest or indications of unethical behavior. Exemptions from these reporting requirements are limited and well-defined, applying mainly to accounts that are managed by independent third-party managers over which the employee has no direct control or influence. The COE provides a structured compliance framework that outlines procedures for reminders and steps to address instances of late or missed report submissions. Should these situations occur, the COE sets out a clear process for enacting disciplinary measures. This framework is designed to support a trading environment that aligns with regulatory expectations. Resolution of Conflicts The Trust Agreement provides that whenever a conflict of interest exists between the Sponsor or any of its affiliates, on the one hand, and the Trust or any Shareholders or any other person, on the other hand, the Sponsor will resolve such conflict of interest considering the relative interest of each party (including its own interest) and the benefits and burdens relating to such interests, any customary or accepted industry practices, and any applicable accepted accounting practices or principles. In the absence of fraud, gross negligence or willful misconduct by the Sponsor, the resolution, action or terms so made, taken or provided by the Sponsor shall not constitute a breach of this Trust Agreement or any other agreement contemplated herein or of any duty or obligation of the Sponsor at law or in equity or otherwise. privacy policy The following discussion is qualified in its entirety by reference to the privacy policy. A copy of the privacy policy is available at https://www.tidalfinancialgroup.com/privacy-policy/. The Sponsor, the Trust, and the Fund have adopted a privacy policy relating to the collection, maintenance, and use of nonpublic personal information about the Fund s current and former investors, as required under federal law. Federal law gives investors the right to limit some but not all sharing of their nonpublic personal information. Federal law also requires the Sponsor to tell investors how it collects, Shares, and protects such nonpublic personal information. Collection of Nonpublic Personal Information The Sponsor may collect or have access to nonpublic personal information about current and former Fund investors for certain purposes relating to the operation of the Fund. This information may include information received from investors, such as their name, social security number, telephone number, and address, and information about investors holdings and transactions in Shares of the Fund. Use and Disclosure of Nonpublic Personal Information The Sponsor does not sell nonpublic personal information to any third parties. The Sponsor primarily uses investors nonpublic personal information to complete financial transactions that may be requested. The Sponsor may disclose investors nonpublic personal information to third parties under specific circumstances described in the privacy policy. These circumstances include, among others, information needed to complete financial transactions, information released at the direction of an investor, and certain information requested by courts, regulators, law enforcement, or tax authorities. Investors may not opt out of these disclosures. Investors nonpublic personal information, particularly information about investors holdings and transactions in Shares of the Fund, may be shared between and amongst the Sponsor and the Fund. An investor cannot opt-out of the sharing of nonpublic personal information between and amongst the Sponsor and the Fund. However, the Sponsor and the Fund will not use this information for any cross-marketing purposes. In other words, all investors will be treated as having "opted out" of receiving marketing solicitations from the Fund. Protection of Nonpublic Personal Information As described in the privacy policy, the Sponsor takes safeguards to protect investors nonpublic personal information, which include, among others, restricting access to such information, requiring third parties to follow appropriate standards of security and confidentiality, and maintaining physical, technical, administrative, and procedural safeguards. The Sponsor s Website is hosted in the United States and any data provided to the Sponsor is stored in the United States. If you choose to provide Personal Data from regions outside of the United States, then by your submission of such data, you acknowledge and agree that: (a) you are transferring your personal information outside of those regions to the United States voluntarily and with consent; (b) the laws and regulations of the United States shall govern your use of the provision of your information, which laws and regulations may differ from those of your country of residence; and (c) you permit your personal information to be used for the purposes herein and in the Privacy Policy above. EXPENSES Expenses to Be Paid by the Sponsor The Sponsor has agreed to assume the following fees and expenses incurred by the Trust: the Marketing Fee, the Administrator Fee, each respective Custodian Fee, the Transfer Agent Fee, the Trustee fee, applicable license fees, including the licensing fees related to the Index License Agreement, fees and expenses related to public trading of the Shares on the Exchange (including marketing, legal and audit fees and expenses), legal expenses, audit fees, regulatory fees, including any fees relating to the registration of the Shares with the SEC, printing and mailing costs and costs of maintaining the Fund s website. There is no cap on expenses for the above-listed fees payable by the Sponsor. Extraordinary and Other Expenses In certain extraordinary circumstances, the Fund may pay expenses in addition to the Management Fee, including, but not limited to, any expenses of the Fund that are not assumed by the Sponsor, taxes and governmental charges, expenses and costs of any extraordinary services performed by the Sponsor (or any other Service Provider) on behalf of the Fund, indemnification expenses of the Bitcoin Custodian and/or Non-Digital Custodian, Administrator or other agents, service providers or counterparties of the Fund and extraordinary legal fees and expenses, and all other transaction related fees and expenses charged in connection with trading activities for the Fund s investments and for maintenance of its CFTC regulatory status as a commodity pool (collectively, "Additional Fund Expenses"). When Additional Fund Expenses are incurred, the Fund will be required to pay these Additional Fund Expenses too. Although the Sponsor cannot definitively state the frequency or magnitude of the Additional Fund Expenses, with the exception of transaction related fees and expenses and for maintenance of its CFTC regulatory status as a commodity pool, the Sponsor expects that they may occur infrequently, if at all. Payment of Expenses To pay the Management Fee, the Sponsor is paid in U.S. dollars. In paying the Management Fee, the Sponsor may need to direct the Fund s bitcoin to be exchanged for U.S. dollars and Carbon Credit Futures to be sold. Under such circumstances, the Sponsor will utilize an approved Bitcoin Trading Counterparty to exchange the Fund s bitcoin for U.S. dollars. The Non-Digital Custodian will, when directed by the Sponsor, withdraw funds from the Trust s accounts to an account maintained by the Non-Digital Custodian for the Sponsor. Each sale of bitcoin by the Fund to pay the Management Fee or other Fund expenses will be a taxable event to Shareholders. In addition, if the Fund incurs any Additional Fund Expenses, the Sponsor will cause the Non-Digital Custodian to withdraw funds from the Fund s accounts in such quantity as may be necessary to permit payment of such Additional Fund Expenses. In order to pay for such Additional Fund Expenses, the Fund may need to sell bitcoin and/or Carbon Credit Futures, which it will do in a manner similar to the process defined above. Shareholders do not have the option of choosing to pay their proportionate shares of Additional Fund Expenses in lieu of having their shares of Additional Fund Expenses paid by the Fund. PROVISIONS OF LAW According to applicable law, indemnification of the Sponsor is payable only if the Sponsor determined, in good faith, that the act, omission or conduct that gave rise to the claim for indemnification was in the best interest of the Fund and the act, omission or activity that was the basis for such loss, liability, damage, cost or expense was not the result of negligence or misconduct and such liability or loss was not the result of negligence or misconduct by the Sponsor, and such indemnification or agreement to hold harmless is recoverable only out of the assets of the Fund. Provisions of Federal and State Securities Laws This offering is made pursuant to federal and state securities laws. The SEC and state securities agencies take the position that indemnification of the Sponsor that arises out of an alleged violation of such laws is prohibited unless certain conditions are met. These conditions require that no indemnification of the Sponsor or any underwriter for the Fund may be made in respect of any losses, liabilities or expenses arising from or out of an alleged violation of federal or state securities laws unless: (i) there has been a successful adjudication on the merits of each count involving alleged securities law violations as to the party seeking indemnification and the court approves the indemnification; (ii) such claim has been dismissed with prejudice on the merits by a court of competent jurisdiction as to the party seeking indemnification; or (iii) a court of competent jurisdiction approves a settlement of the claims against the party seeking indemnification and finds that indemnification of the settlement and related costs should be made, provided that, before seeking such approval, the Sponsor or other indemnitee must apprise the court of the position held by regulatory agencies against such indemnification. These agencies are the SEC and the securities administrator of the State or States in which the plaintiffs claim they were offered or sold interests. Provisions of the Securities Act Insofar as indemnification for liabilities arising under the Securities Act may be permitted to the Sponsor or directors, officers, or persons controlling the Fund, the Fund has been informed that the SEC believes that such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. MANAGEMENT; VOTING BY SHAREHOLDERS The Shareholders of the Fund take no part in the management or control, and have no voice in, the Fund s operations or business. Shareholders have no voting rights with respect to the Trust or the Fund except as expressly provided in the Trust Agreement. The Trust Agreement provides that Shareholders representing at least a majority (over 50%) of the outstanding Shares of the Fund together as a single class (excluding Shares acquired by the Sponsor in connection with its initial capital contribution to any Trust series) may vote to (i) continue the Trust by electing a successor Sponsor as described above, and (ii) approve amendments to the Trust Agreement that impair the right to surrender Redemption Baskets for redemption. (Trustee consent to any amendment to the Trust Agreement is required if the Trustee reasonably believes that such amendment adversely affects any of its rights, duties or liabilities.) In addition, Shareholders holding Shares representing seventy-five percent (75%) of the outstanding Shares of the Fund, voting together as a single class (excluding Shares acquired by the Sponsor in connection with its initial capital contribution to any Trust series) may vote to dissolve the Trust upon not less than ninety (90) days notice to the Sponsor. MEETINGS Meetings of the Trust s Shareholders may be called by the Sponsor and will be called by it upon the written request of Shareholders holding at least 25% of the outstanding Shares of the Trust or the Fund, as applicable (not including Shares acquired by the Sponsor through its initial capital contribution). The Sponsor shall deposit in the United States mail or electronically transmit written notice to all Shareholders of the Fund of the meeting and the purpose of the meeting, which shall be held on a date not less than 30 nor more than 60 days after the date of mailing of such notice, at a reasonable time and place. Where the meeting is called upon the written request of the Shareholders of the Fund, or any other Fund, as applicable, such written notice shall be mailed or transmitted not more than 45 days after such written request for a meeting was received by the Sponsor. BOOKS AND RECORDS The Trust keeps its books of record and account at the office of the Sponsor located at 234 West Florida Street, Suite 203, Milwaukee, Wisconsin 53204, or at the offices of the Administrator, or such office, including of an administrative agent, as it may subsequently designate upon notice. The books of account of the Fund are open to inspection by any Shareholder (or any duly constituted designee of a Shareholder) at all times during the usual business hours of the Fund upon reasonable advance notice to the extent such access is required under CFTC rules and regulations. The Trust keeps a copy of the Trust Agreement on file in the Sponsor s office, which will be available for inspection by any Shareholder at all times during the Sponsor s usual business hours upon reasonable advance notice. GOVERNING LAW; CONSENT TO DELAWARE JURISDICTION The rights of the Sponsor, the Trust, the Fund, DTC (as registered owner of the Trust s global certificate for Shares) and the Shareholders are governed by the laws of the State of Delaware. The Sponsor, the Trust, the Fund and DTC and, by accepting Shares, each DTC Participant and each Shareholder, consent to the exclusive jurisdiction of the courts of the State of Delaware and any federal courts located in Delaware. Such consent is not required for any person to assert a claim of Delaware jurisdiction over the Sponsor or the Trust. The Trust Agreement and the effect of every provision thereof shall control over any contrary or limiting statutory or common law of the State of Delaware, other than the Delaware Trust Statute. legal matters Litigation and Claims Except as described above, within the past 10 years of the date of this prospectus, there have been no material administrative, civil or criminal actions against the Sponsor, the Trust or the Fund, or any principal or affiliate of any of them. This includes any actions pending, on appeal, concluded, threatened or otherwise known to them. Legal Opinion Chapman and Cutler LLP has advised the Sponsor in connection with the Shares being offered. Chapman and Cutler LLP has also provided the Sponsor with its opinion with respect to U.S. federal income tax matters addressed herein in "Material U.S. Federal Income Tax Consequences." Certain opinions of counsel will be filed with the SEC as exhibits to the Registration Statement. Experts The financial statements of the Trust and management s assessment of the effectiveness of internal controls over financial reporting of the Trust incorporated by reference in reliance upon the reports of Tait, Weller, & Baker, LLP ("Tait Weller"), independent registered public accountants, upon the authority of said firm as experts in accounting and auditing. The financial statements of the Fund included in this prospectus have been so included upon the reliance upon the reports of Tait Weller, independent registered public accountants, upon the authority of said firm as experts in accounting and auditing. No expert hired by the Fund to give advice on the preparation of this offering document has been hired on a contingent fee basis, nor do any of them have any present or future expectation of interest in the Sponsor, Marketing Agent, Authorized Purchasers, Custodians/Administrator or other service providers to the Fund. Material U.S. FEDERAL INCOME TAX CONSEQUENCES The following discussion summarizes certain material U.S. federal income tax consequences of the ownership of Shares. This discussion does not describe all of the tax consequences that may be relevant to a beneficial owner of Shares in light of the beneficial owner s particular circumstances, including tax consequences applicable to beneficial owners subject to special rules, such as: financial institutions; dealers in securities; traders in securities or commodities that have elected to apply a mark-to-market method of tax accounting in respect thereof; persons holding Shares as part of a hedge, "straddle," integrated transaction or similar transaction; persons holding Shares acquired by them as part of a Creation Basket or redeeming Shares in exchange for the underlying bitcoins and/or carbon credit futures represented by the redeemed Shares; U.S. Holders (as defined below) whose functional currency is not the U.S. dollar; entities or arrangements classified as partnerships for U.S. federal income tax purposes; real estate investment trusts; regulated investment companies; and tax-exempt entities, including individual retirement accounts. This discussion applies only to Shares that are held as capital assets and does not address alternative minimum tax consequences or, except as explicitly discussed below, the consequences of the 3.8% Medicare surtax on net investment income. If an entity or arrangement that is classified as a partnership for U.S. federal income tax purposes holds Shares, the U.S. federal income tax treatment of a partner will generally depend on the status of the partner and the activities of the partnership. Partnerships holding Shares and partners in those partnerships are urged to consult their tax advisers about the particular U.S. federal income tax consequences of owning Shares. This discussion is based on the Code, administrative pronouncements, judicial decisions and final, temporary and proposed Treasury regulations as of the date hereof, changes to any of which subsequent to the date hereof may affect the tax consequences described herein. Prospective investors are urged to consult their tax advisers about the application of the U.S. federal income tax laws to their particular situations, as well as any tax consequences arising under the laws of any state, local or foreign taxing jurisdiction. Tax matters are complex, and the tax consequences of the purchase and holding of the Shares will depend on the particular facts of each investor s situation. You are advised to consult your own tax advisors with respect to the application to your own circumstances of the U.S. federal income tax rules described below and with respect to other federal, state, local, or foreign tax consequences to you before making an investment in the Shares. U.S. Federal Income Taxation of the Fund The Fund is classified as a corporation for U.S. federal income tax purposes, and as such is obligated to pay U.S. federal and applicable state and foreign corporate taxes on its taxable income. This differs from many investment companies, which elect to be treated as "regulated investment companies" under the Code in order to avoid income tax obligations at the entity level. Under current law, the Fund is not eligible to elect treatment as a regulated investment because the Fund s investments consist primarily of bitcoin. As a result, the Fund will be obligated to pay U.S. federal and state taxes on its taxable income unlike other investment companies which are not so obligated. The amount of taxes currently paid by the Fund will vary depending on the amount of income and gains derived from investments, and such taxes may reduce your return from an investment in the Fund. The Fund invests its assets primarily in bitcoin and carbon credit futures contracts. In the case of bitcoin, some of the carbon credit futures used by the Fund may be "Section 1256 contracts." Any gains or losses on Section 1256 contracts are generally considered 60% long-term and 40% short-term capital gains or losses (60/40) although certain foreign currency gains and losses from such contracts may be treated as ordinary in character. Also, Section 1256 contracts held by the Fund at the end of each taxable year are "marked to market" with the result that unrealized gains or losses are treated as though they were realized and the resulting gain or loss is treated as ordinary or 60/40 gain or loss. In the case of bitcoin, due to the new and evolving nature of digital assets and the absence of comprehensive guidance with respect to digital assets, many significant aspects of the U.S. federal income tax treatment of digital assets such as bitcoin are uncertain. Our dealings in or in connection with digital assets, as well as transactions in digital assets generally, could be subject to adverse tax consequences in the U.S., including as a result of changes in the legal regimes regulating digital assets, and our operating results, as well as the price of digital assets, could be adversely affected thereby. Many significant aspects of the U.S. federal income tax treatment of digital assets (including with respect to the amount, timing and character of income recognition) are uncertain. In 2014, the IRS released a notice (the "Notice") discussing certain aspects of digital assets for U.S. federal income tax purposes and, in particular, providing that such digital assets (1) are "property," (2) are not "currency" for purposes of the rules relating to foreign currency gain or loss and (3) may be held as a capital asset. In 2019, the IRS released a revenue ruling and a set of "Frequently Asked Questions" (the "Ruling & FAQs") that provide some additional guidance, including guidance to the effect that, under certain circumstances, hard forks of digital assets are taxable events giving rise to ordinary income and guidance with respect to the determination of the tax basis of digital assets. The Notice and the Ruling & FAQs, however, do not address other significant aspects of the U.S. federal income tax treatment of digital assets. We do not intend to request a ruling from the IRS on these or any other issues, and we will take positions on these and other U.S. federal income tax issues relating to digital assets that we believe to be reasonable. There can be no assurance that the IRS will agree with the positions we take, and it is possible that the IRS will successfully challenge our positions. There can be no assurance that the IRS will not alter its position with respect to digital assets in the future or that a court would uphold the treatment set forth in the Notice and the Ruling & FAQs. It is also unclear what additional guidance on the treatment of digital assets for U.S. federal income tax purposes may be issued in the future. Any such alteration of the current IRS positions or additional guidance could result in adverse tax consequences for us and could have an adverse effect on the value of bitcoin or other digital assets. Because of the evolving nature of digital assets, it is not possible to predict potential future developments that may arise with respect to digital assets. Such developments may increase the uncertainty with respect to the treatment of digital assets for U.S. federal income tax purposes. For example, the Notice addresses only digital assets that are "convertible virtual currency," and it is conceivable that we will hold certain types of digital assets that are not within the scope of the Notice. On November 15, 2021, President Biden signed the Infrastructure Investment and Jobs Act (the "IIJA") into law. The IIJA implements a set of comprehensive financial account information reporting rules that will apply to persons, including digital asset trading platforms and custodians, that regularly effect transfers of digital assets on behalf of other persons. In particular, these rules will require digital asset trading platforms and custodians to report digital asset transactions (including sales, exchanges and other transfers) effected on behalf of other persons on an annual return, in a manner similar to the current reporting rules for brokers that effect stock and other securities transactions on behalf of customers. The IRS issued proposed regulations on these rules on August 28, 2023. Under the proposed regulations the gross proceeds of sales or exchanges of digital assets must be reported for transactions that take place on or after January 1, 2025, and, in certain circumstances, gain or loss with respect to such sales or exchanges must be reported for transactions that take place on or after January 1, 2026. These rules, the effects of which may depend in significant part on regulations or other guidance from the IRS on their implementation, could create significant compliance burdens for us and our investors, and could affect the price of digital assets, which could have an adverse effect on our investments. Federal Income Taxation of Holders of the Fund s Shares — U.S. Shareholders The discussion under the heading "Federal Income Taxation of Holders of the Fund s Shares – U.S. Shareholders" (and all subheadings thereunder) applies to a beneficial owner of a Share for U.S. federal income tax purposes that is: an individual who is a citizen or resident of the U.S. for U.S. federal income tax purposes; a corporation, or other entity classified as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the U.S. or of any political subdivision thereof; or an estate or trust the income of which is subject to U.S. federal income taxation regardless of its source. Receipt of Distributions Distributions made to you by the Fund (other than distributions in redemption of Shares subject to Section 302(b) of the Code) will generally constitute dividends to the extent of your allocable share of the Fund s current or accumulated earnings and profits, as calculated for federal income tax purposes. Generally, a corporation s earnings and profits are computed based upon taxable income, with certain specified adjustments. To the extent that distributions to you exceed your allocable share of the Fund s current and accumulated earnings and profits, your tax basis in the Fund s Shares with respect to which the distribution is made will be reduced, which will increase the amount of any taxable gain (or decrease the amount of any tax loss) realized upon a subsequent sale or redemption of such Shares. To the extent you hold such Shares as a capital asset and have no further basis in the Shares to offset the distribution, you will report the excess as capital gain. Distributions treated as dividends under the foregoing rules generally will be taxable as ordinary income to you but may be treated as "qualified dividend income." Under current U.S. federal income tax law, qualified dividend income received by individuals and other non-corporate shareholders is taxed at long-term capital gain rates, which are currently at a maximum of either 15% or 20% depending on whether the shareholder s income exceeds certain threshold amounts. For a dividend to constitute qualified dividend income, the shareholder generally must hold the Shares paying the dividend for more than 60 days during the 121-day period beginning 60 days before the ex-dividend date, although a longer period may apply if the shareholder engages in certain risk reduction transactions with respect to the common stock. Dividends paid by the Fund are expected to be eligible for the dividends received deduction available to corporate shareholders under Section 243 of the Code. However, corporate shareholders should be aware that certain limitations apply to the availability of the dividends received deduction, including rules which limit the deduction in cases where (i) certain holding period requirements are not met, (ii) the corporate shareholder is obligated (e.g., pursuant to a short sale) to make related payments with respect to positions in substantially similar or related property, or (iii) the corporate shareholder s investment in Shares of the Fund is financed with indebtedness. Corporate shareholders should consult their own tax advisors regarding the application of these limitations to their particular situations. An additional 3.8% Medicare surtax is imposed on certain net investment income (including ordinary dividends received from the Fund and net gains from redemptions or other taxable dispositions of Fund Shares) of U.S. individuals, estates and trusts to the extent that such person s "modified adjusted gross income" (in the case of an individual) or "adjusted gross income" (in the case of an estate or trust) exceeds certain threshold amounts. Redemptions and Sales of Shares A redemption of common Shares will be treated as a sale or exchange of such Shares, provided the redemption either is not essentially equivalent to a dividend, is a substantially disproportionate redemption, is a complete redemption of a shareholder s entire interest in the Fund, or is in partial liquidation of the Fund. Redemptions that do not qualify for sale or exchange treatment will be treated as described in "Receipt of Distributions" above. Upon a redemption treated as a sale or exchange under the foregoing rules, or upon a sale of your Shares to a third party, you generally will recognize capital gain or loss equal to the difference between the cost of your Shares and the amount you receive when you sell them. Any such capital gain or loss will be a long-term capital gain or loss if you held the Shares for more than one year at the time of disposition. Long-term capital gains of certain non-corporate common shareholders (including individuals) are currently subject to U.S. federal income taxation at a maximum rate of either 15% or 20% depending on whether the shareholder s income exceeds certain threshold amounts. The deductibility of capital losses is subject to limitations under the Code. A federal excise tax on stock repurchases is expected to apply to the Fund in the event that the Fund repurchases its own Shares. The excise tax is one percent (1%) of the fair market value of Fund Share redemptions less the fair market value of Fund Share issuances (in excess of $1 million of fair market value) annually on a taxable year basis. This excise tax would be payable by the Fund, and not by any holder of Shares, although payment of the excise tax could reduce a shareholder s return on an investment in the Fund. Tax-Exempt Investors Employee benefit plans and most other organizations exempt from federal income tax, including individual retirement accounts and other retirement plans, are subject to federal income tax on their unrelated business taxable income (or "UBTI"). Because the Fund is classified as a corporation for federal income tax purposes, an owner of any of the Fund s Shares will not report on its federal income tax return any items of income, gain, loss, and deduction that are allocated to the Fund from its investments. Moreover, dividend income from, and gain from the sale of, corporate stock generally does not constitute UBTI unless the acquisition of the corporate stock is debt-financed. Therefore, a tax-exempt investor should not have UBTI attributable to the ownership, sale, or redemption of the Fund s Shares unless the tax-exempt investor s acquisition of the Shares was financed with debt. In general, Shares are considered to be debt-financed if the tax-exempt owner of the Shares incurred debt to acquire the Shares or otherwise incurred a debt that would not have been incurred if the Shares had not been acquired. Regulated Investment Company Investors The income and gain realized from an investment in the Fund s Shares by an investor that is a regulated investment company should constitute qualifying income for the purposes of the rules relating to regulated investment companies. Furthermore, the Fund s Shares will generally constitute "qualifying assets" for a regulated investment company, which are generally subject to a requirement that at least 50% of the regulated investment company s total assets must consist of qualifying assets at the end of each quarter, and the amount of Fund Shares owned by the regulated investment company may not constitute more than 5% of the value of the total assets held by the regulated investment company or more than 10% of the Fund s outstanding voting securities. Federal Income Taxation of Holders of the Fund s Shares — Non-U.S. Shareholders The discussion under the heading "Federal Income Taxation of Holders of the Fund s Shares – Non-U.S. Shareholders" applies to, and the term "Non-U.S. Shareholder" shall mean, a beneficial owner of a Share for U.S. federal income tax purposes that is: a nonresident alien individual; a foreign corporation; or a foreign estate or trust. Receipt of Distributions Distributions by the Fund will be treated as dividends for U.S. federal income tax purposes to the extent paid from the Fund s current or accumulated earnings and profits (as determined under U.S. federal income tax principles). Dividends paid by the Fund to a Non-U.S. Shareholder generally will be subject to withholding tax at a 30% rate or a reduced rate specified by an applicable income tax treaty. If a Non-U.S. Shareholder claims a reduced rate of withholding under an income tax treaty, the Non-U.S. Shareholder will be required to provide an IRS Form W-8BEN or IRS Form W-8BEN-E certifying its eligibility to benefits under the income tax treaty in order to obtain the reduced rate of withholding tax. If the amount of a distribution exceeds a Non-U.S. Shareholder s allocable share of the Fund s current and accumulated earnings and profits, such excess will be treated for U.S. federal income tax purposes as a tax-free return of capital to the extent of the Non-U.S. Shareholder s tax basis in the Fund s Shares. To the extent that any distribution received by a Non-U.S. Shareholder exceeds the sum of (i) such Non-U.S. Shareholder s allocable share of the Fund s current and accumulated earnings and profits and (ii) such Non-U.S. Shareholder s tax basis in the Fund s Shares, such excess will be treated as gain from the sale of the Shares and will be taxed as described in "Redemptions and Sales of Shares" below. Redemptions and Sales of Shares A redemption of the Fund s Shares will be treated as a sale or exchange of such Shares, provided the redemption either is not essentially equivalent to a dividend, is a substantially disproportionate redemption, is a complete redemption of a shareholder s entire interest in the Fund, or is in partial liquidation of the Fund. Redemptions that do not qualify as a sale or exchange will be treated as described in "Receipt of Distributions" above. A Non-U.S. Shareholder generally will not be subject to U.S. federal income tax on gain realized on a redemption that is treated as a sale or exchange for U.S. federal income tax purposes, or on gain realized on the sale, exchange or other non-redemption disposition of the Fund s Shares, except in the following situations: the gain is effectively connected with a trade or business of the Non-U.S. Shareholder in the U.S. or, if the Non-U.S. Shareholder is a qualifying resident of a country with which the U.S. has a tax treaty, such gain is attributable to a permanent establishment maintained by such Non-U.S. Shareholder in the U.S.; the Non-U.S. Shareholder is an individual who is present in the U.S. for 183 days or more in the taxable year of disposition and who has a "tax home" in the U.S.; or the Fund is or has been a U.S. real property holding corporation, as defined below, at any time within the five-year period preceding the date of disposition of the Shares or, if shorter, within the period during which the Non-U.S. Shareholder has held the Shares. Generally, a corporation is a U.S. real property holding corporation if the fair market value of its U.S. real property interests, as defined in the Code and applicable regulations, equals or exceeds 50% of the aggregate fair market value of its worldwide real property interests and its other assets used or held for use in a trade or business. The Fund is not likely to be or become a U.S. real property holding corporation as long as the Fund invests consistently with its investment strategy. Each potential Non-U.S. Shareholder is urged to consult his, her or its own tax advisor regarding the U.S. federal income tax consequences of the acquisition, holding, redemption, sale, exchange or other disposition of Fund Shares. Estate Tax Non-U.S. Shareholders of the Fund may be subject to U.S. estate tax with respect to their Fund Shares. FATCA Withholding Withholding of U.S. tax (at a 30% rate) is required with respect to payments of dividends made to certain non-U.S. entities that fail to comply (or be deemed compliant) with extensive reporting and withholding requirements designed to inform the U.S. Department of the Treasury of U.S.-owned foreign investment accounts. Shareholders may be requested to provide additional information to enable the applicable withholding agent to determine whether withholding is required. Backup Withholding Federal regulations generally require the Fund to withhold and remit "backup withholding" to the U.S. Treasury with respect to dividends and the proceeds of any redemption paid to you if you fail to furnish the Fund or the Fund s paying agent with a properly completed and executed IRS Form W-9, IRS Form W-8BEN, IRS Form W-8BEN-E or other applicable form. Furthermore, the IRS may notify the Fund to institute backup withholding if the IRS determines that your taxpayer identification number is incorrect or if you have failed to properly report taxable dividends or interest on a federal tax return. A taxpayer identification number is either the Social Security number or employer identification number of the record owner of the Shares. Any backup withholding does not constitute an additional tax imposed on the record owner of the Shares and may be claimed as a credit on the record owner s federal income tax return. The current backup withholding rate is 24%. Taxes on Purchase and Redemption of Creation Units An investor who exchanges bitcoin or carbon credit futures for Creation Shares generally will recognize a gain or a loss. The gain or loss will be equal to the difference between the market value of the Creation Shares at the time of the exchange and the exchanger s aggregate basis in the bitcoin or carbon credit futures surrendered and the amount of any cash consideration paid. A person who exchanges Creation Shares for bitcoin or carbon credit futures will generally recognize a gain or loss equal to the difference between the exchanger s basis in the Creation Shares and the aggregate value of the bitcoin and/or carbon credit futures and any cash received on such redemption. The IRS, however, may assert that a loss realized upon an exchange of securities for Creation Shares cannot be deducted currently under the rules governing "wash sales," or on the basis that there has been no significant change in economic position. Persons exchanging securities should consult their own tax advisor with respect to whether the wash sale rules apply and when a loss might be deductible. If you purchase or redeem Creation Shares, you will be sent a confirmation statement showing how many and at what price you purchased or sold Shares. The foregoing discussion summarizes certain consequences under current U.S. federal tax law of an investment in the Fund. It is not a substitute for personal tax advice. You may also be subject to state and local taxation on Fund distributions, and sales of Fund Shares. Consult your personal tax advisor about the potential tax consequences of an investment in Fund Shares under all applicable tax laws. Changes in applicable tax authority could materially affect the conclusions discussed above and could adversely affect the Fund. Purchases by Employee Benefit Plans The Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and/or Code section 4975 impose certain requirements on employee benefit plans and certain other plans and arrangements, including individual retirement accounts and annuities, Keogh plans, and certain collective investment funds or insurance company general or separate accounts in which such plans or arrangements are invested, that are subject to ERISA and/or the Code (collectively, "Plans"), and on persons who are fiduciaries with respect to the investment of assets treated as "plan assets" of a Plan. Government plans and some church plans are not subject to the fiduciary responsibility provisions of ERISA or the provisions of section 4975 of the Code, but may be subject to substantially similar rules under state or other federal law. In contemplating an investment of a portion of Plan assets in Shares, the Plan fiduciary responsible for making such investment should carefully consider, taking into account the facts and circumstances of the Plan, the "Risk Factors" discussed above and whether such investment is consistent with its fiduciary responsibilities, including, but not limited to (1) whether the fiduciary has the authority to make the investment under the appropriate governing plan instrument, (2) whether the investment would constitute a direct or indirect non-exempt prohibited transaction with a party in interest, (3) the Plan s funding objectives, and (4) whether under the general fiduciary standards of investment prudence and diversification such investment is appropriate for the Plan, taking into account the overall investment policy of the Plan, the composition of the Plan s investment portfolio and the Plan s need for sufficient liquidity to pay benefits when due. It is anticipated that the Shares will constitute "publicly-held offered securities" as defined in the Department of Labor Regulations 2510.3-101(b)(2). Accordingly, Shares purchased by a Plan, and not the Plan s interest in the underlying bitcoins held in the Trust represented by the Shares, should be treated as assets of the Plan, for purposes of applying the "fiduciary responsibility" and "prohibited transaction" rules of ERISA and the Code. Investment by Certain Retirement Plans Individual retirement accounts (IRA) and participant-directed accounts under tax-qualified retirement plans are limited in the types of investments they may make under the Code. Potential purchasers of Shares that are IRAs or participant-directed accounts under a Code section 401(a) plan should consult with their own tax advisors as to the consequences of a purchase of Shares. General Pool Disclosure Information you should know This prospectus contains information you should consider when making an investment decision about the Shares. You should rely only on the information contained in this prospectus or any applicable prospectus supplement. None of the Trust, the Fund or the Sponsor has authorized any person to provide you with different information and, if anyone provides you with different or inconsistent information, you should not rely on it. This prospectus is not an offer to sell the Shares in any jurisdiction where the offer or sale of the Shares is not permitted. The information contained in this prospectus was obtained from us and other sources believed by us to be reliable. You should disregard anything we said in an earlier document that is inconsistent with what is included in this prospectus or any applicable prospectus supplement. Where the context requires, when we refer to this "prospectus," we are referring to this prospectus and (if applicable) the relevant prospectus supplement. You should not assume that the information in this prospectus or any applicable prospectus supplement is current as of any date other than the date on the front page of this prospectus or the date on the front page of any applicable prospectus supplement. We include cross references in this prospectus to captions in these materials where you can find further related discussions. The table of contents tells you where to find these captions. where You can find more information The Trust, on behalf of the Fund, has filed a registration statement on Form S-1 with the SEC under the Securities Act. This Prospectus does not contain all of the information set forth in the registration statement (including the exhibits to the registration statement), parts of which have been omitted in accordance with the rules and regulations of the SEC. For further information about the Fund or the Shares, please refer to the registration statement, which you may inspect, without charge, online at www.sec.gov. Information about the Fund and the Shares can also be obtained from the Fund s website, which is 7rccetfs.com. The Fund s website address is only provided here as a convenience to you and the information contained on or connected to the website is not part of this prospectus or the registration statement of which this prospectus is part. The Fund is subject to the informational requirements of the Exchange Act and will file certain reports and other information with the SEC under the Exchange Act. The Sponsor will file an updated prospectus annually on behalf of the Fund pursuant to the requirements of the Securities Act. The reports and other information are available online at www.sec.gov. STATEMENTS, FILINGS AND REPORTS The Trust will furnish annual reports (as of the end of each fiscal year) for the Fund to DTC purchasers for distribution to Shareholders, as required to be provided to Shareholders by the CFTC and the NFA. These annual reports will contain financial statements prepared by the Sponsor and audited by an independent registered public accounting firm designated by the Sponsor. The Trust will also post monthly reports to the Fund s website (7rccetfs.com). These monthly reports will contain certain unaudited financial information regarding the Fund, including the Fund s NAV. The Sponsor will furnish to the Shareholders other reports or information which the Sponsor, in its discretion, determines to be necessary or appropriate. In addition, under SEC rules the Trust will be required to file quarterly and annual reports for the Fund with the SEC, which need not be sent to Shareholders but will be publicly available through the SEC. The Trust will post the same information that would otherwise be provided in the Trust s CFTC, NFA and SEC reports on the Fund s website: 7rccetfs.com. The accountants report on its audit of the Fund s financial statements will be furnished by the Trust to Shareholders upon request. The Trust will file such tax returns, and prepare, disseminate and file such tax reports for the Fund as it is advised by its counsel or accountants are from time to time required by any applicable statute, rule or regulation and will make such tax elections for the Fund as it deems advisable. The Fund or its appointed agent will provide tax information in accordance with the Code and applicable U.S. Treasury Regulations. Persons treated as intermediaries for purposes of these regulations may obtain tax information regarding the Fund by contacting the Fund at 234 West Florida Street, Suite 203, Milwaukee, Wisconsin 53204 or from the Fund s website, 7rccetfs.com. Fiscal Year The fiscal year of the Fund is the period ending December 31 of each year. The Sponsor may select an alternate fiscal year. SUMMARY OF PROMOTIONAL AND SALES MATERIAL The Fund expects to use the following sales material it has prepared: the Fund s website, 7rccetfs.com; and the Fund Fact Sheet found on the Fund s website. The materials described above are not a part of this prospectus or the registration statement of which this prospectus is a part. incorporation by reference of certain documents The Trust is a reporting company and files annual, quarterly and current reports and other information with the SEC. The rules of the SEC allow the Trust to "incorporate by reference" information that the Trust files with them, which means that the Trust can disclose important information to you by referring you to those documents. The information incorporated by reference is an important part of this prospectus. This prospectus incorporates by reference the documents set forth below that have been previously filed with the SEC and any future filings that the Trust makes with the SEC under Section 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934 (in each case other than those documents or portions of those documents not deemed to have been filed in accordance with SEC rules) between the date of this prospectus and the termination of the offering of the securities to be issued under the registration statement: Our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on April 1, 2024; Our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2024 filed with the SEC on May 15, 2024; Our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2024 filed with the SEC on August 14, 2024; and Out Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2024 filed with the SEC on November 14, 2024. Any statement contained in a document incorporated by reference in this prospectus shall be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained in this prospectus or in any other subsequently filed document that also is or is deemed to be incorporated by reference in this prospectus modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus. We will provide to each person to whom a prospectus is delivered, including any beneficial owner, a copy of any document incorporated by reference in the prospectus (excluding any exhibits to those documents unless the exhibit is specifically incorporated by reference as an exhibit in that document) at no cost, upon written or oral request at the following address or telephone number: 7RCC Spot Bitcoin and Carbon Credit Futures ETF Attention: Tidal Investments LLC 234 West Florida Street, Suite 203 Milwaukee, WI 53204 (844)-986-7700 The Fund s internet website is 7rccetfs.com. The Trust makes its electronic filings with the SEC, including its annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to these reports available on the Fund s website free of charge as soon as practicable after we file or furnish them with the SEC. The information contained on the Fund s website is not incorporated by reference in this prospectus and should not be considered a part of this prospectus. financial statements The financial statements of the Trust have been incorporated into this prospectus and registration statement as described above under "Incorporation By Reference of Certain Information." The financial statements of the Fund are set forth below. 7RCC Spot Bitcoin and Carbon Credit Futures ETF Index to Financial Statements Page Number Report of Independent Registered Public Accounting Firm 121 Statement of Assets and Liabilities 121 Notes to Statement of Assets and Liabilities 121 Report of Independent Registered Public Accounting Firm [to be provided by pre-effective amendment] 7RCC Spot Bitcoin and Carbon Credit Futures ETF Statement of Assets and Liabilities [to be provided by pre-effective amendment] Notes to Statement of Assets and Liabilities [______, ____] [to be provided by pre-effective amendment] TABLE OF CONTENTS Page GLOSSARY OF DEFINED TERMS i PART ONE – Disclosure document 1 STATEMENT REGARDING FORWARD-LOOKING STATEMENTS 1 INDUSTRY AND MARKET DATA 1 PROSPECTUS SUMMARY 2 THE OFFERING 10 RISK FACTORS 14 Investment objective and investment strategy 50 OVERVIEW OF THE BITCOIN INDUSTRY AND MARKET 59 OVERVIEW OF COMMODITY Futures MARKETS and carbon markets 67 Description of the index 69 Performance of the other commodity pools operated by the cpo 70 Management s discussion and analysis of financial condition and results of operations 77 Charges 78 USE OF PROCEEDS 79 Who may subscribe 80 DESCRIPTION OF CREATION AND REDEMPTION OF SHARES 80 ADDITIONAL INFORMATION ABOUT THE TRUST 84 plan of distribution 89 Additional Information Regarding the Shares 90 CUSTODY OF THE Fund s ASSETS 91 THE FUND S SERVICE PROVIDERS 95 AUTHORIZED Purchasers 105 CALCULATION OF NAV 105 conflicts of interest 108 privacy policy 109 EXPENSES 110 PROVISIONS OF LAW 111 MANAGEMENT; VOTING BY SHAREHOLDERS 111 MEETINGS 111 BOOKS AND RECORDS 112 GOVERNING LAW; CONSENT TO DELAWARE JURISDICTION 112 legal matters 112 Experts 112 Material U.S. FEDERAL INCOME TAX CONSEQUENCES 112 Purchases by employee benefit plans 117 Part two – General Pool Disclosure 119 information you should know 119 where You can find more information 119 STATEMENTS, FILINGS AND REPORTS 119 Fiscal Year 119 SUMMARY OF PROMOTIONAL AND SALES MATERIAL 120 incorporation by reference of certain documents 120 financial statements 120 statement of additional information Statement of additional information 7RCC Spot Bitcoin and Carbon Credit Futures ETF This statement of additional information is the second part of a two-part document. The first part is the Fund s disclosure document. The disclosure document and this statement of additional information are bound together, and both parts contain important information. This statement of additional information should be read in conjunction with the disclosure document. To obtain a copy of the disclosure document without charge, call the Fund at (844)-986-7700. Before you decide whether to invest, you should read the entire prospectus carefully and consider the risk factors beginning on page [ ]. This statement of additional information and accompanying disclosure document are both dated [ ], 2025. PART II—INFORMATION NOT REQUIRED IN PROSPECTUS TABLE OF CONTENTS Item 13.Other Expenses of Issuance and Distribution. The Trust shall not bear any expenses incurred in connection with the issuance and distribution of the securities being registered. These expenses shall be paid by Tidal Investments LLC, the sponsor of the Trust. Except for the Securities and Exchange Commission Registration Fee and Exchange Listing Fee, all such expenses are estimated: SEC registration fee (actual) $[ ]* Listing fee (actual) $[ ]* Auditor s fees and expenses $[ ]* Legal fees and expenses $[ ]* Printing expenses $[ ]* Miscellaneous expenses $[ ]* Total $[ ]* * to be provided by amendment Item 14.Indemnification of Directors and Officers. The Trust s First Amended and Restated Declaration of Trust and Trust Agreement (the "Trust Agreement") provides that the Sponsor shall be indemnified by the Trust(or, by a series of the Trust separately to the extent the matter in question relates to a single series or disproportionately affects a series in relation to other series) against any losses, judgments, liabilities, expenses and amounts paid in settlement of any claims sustained by it in connection with its activities for the Trust, provided that (i) the Sponsor was acting on behalf of or performing services for the Trust and has determined, in good faith, that such course of conduct was in the best interests of the Trust and such liability or loss was not the result of gross negligence, willful misconduct, or a breach of the Trust Agreement on the part of the Sponsor and (ii) any such indemnification will only be recoverable from the applicable trust estate or trust estates. All rights to indemnification permitted by the Trust Agreement and payment of associated expenses shall not be affected by the dissolution or other cessation to exist of the Sponsor, or the withdrawal, adjudication of bankruptcy or insolvency of the Sponsor, or the filing of a voluntary or involuntary petition in bankruptcy under Title 11 of the Bankruptcy Code by or against the Sponsor. Notwithstanding the foregoing, the Sponsor shall not be indemnified for any losses, liabilities or expenses arising from or out of an alleged violation of U.S. federal or state securities laws unless (i) there has been a successful adjudication on the merits of each count involving alleged securities law violations as to the particular indemnitee and the court approves the indemnification of such expenses (including, without limitation, litigation costs), (ii) such claims have been dismissed with prejudice on the merits by a court of competent jurisdiction as to the particular indemnitee and the court approves the indemnification of such expenses (including, without limitation, litigation costs) or (iii) a court of competent jurisdiction approves a settlement of the claims against a particular indemnitee and finds that indemnification of the settlement and related costs should be made. The Trust and its series shall not incur the cost of that portion of any insurance which insures any party against any liability, the indemnification of which is prohibited by the Trust Agreement. Expenses incurred in defending a threatened or pending civil, administrative or criminal action, suit or proceeding against the Sponsor shall be paid by the Trust or the applicable series of the Trust in advance of the final disposition of such action, suit or proceeding, if (i) the legal action relates to the performance of duties or services by the Sponsor on behalf of the Trust or a series of the Trust; (ii) the legal action is initiated by a party other than the Trust; and (iii) the Sponsor undertakes to repay the advanced funds with interest to the Trust or the applicable series of the Trust in cases in which it is not entitled to indemnification under the Trust Agreement. For purposes of the indemnification provisions of the Trust Agreement, the term "Sponsor" includes, in addition to the Sponsor, any other covered person performing services on behalf of the Trust and acting within the scope of the Sponsor s authority as set forth in the Trust Agreement. II-1 In the event the Trust or a series of the Trust is made a party to any claim, dispute, demand or litigation or otherwise incurs any loss, liability, damage, cost or expense as a result of or in connection with any Shareholder s (or assignee s) obligations or liabilities unrelated to Trust business, such Shareholder (or assignees cumulatively) shall indemnify, defend, hold harmless, and reimburse the Trust or the applicable series of the Trust for all such loss, liability, damage, cost and expense incurred, including attorneys and accountants fees. The payment of any amount pursuant to the Trust Agreement shall take into account the allocation of liabilities and other amounts, as appropriate, among the series of the Trust. Item 15.Recent Sales of Unregistered Securities. None. Item 16.Exhibits and Financial Statement Schedules. (a) Exhibits Exhibit Number Description 3.1 First Amended and Restated Declaration of Trust and Trust Agreement(1) 5.1 Opinion of Chapman and Cutler LLP relating to the legality of the Shares* 8.1 Opinion of Chapman and Cutler LLP with respect to federal income tax consequences* 10.1 Form of Authorized Purchaser Agreement (included as Exhibit B to the First Amended and Restated Declaration of Trust and Trust Agreement)(1) 10.2 Form of Distribution Services Agreement* 10.3 Form of Custody Agreement* 10.4 Form of Bitcoin Custody Agreement by and between the Trust, on behalf of the Fund, and Gemini Trust Company, LLC* 10.6 Form of Fund Accounting Servicing Agreement* 10.7 Form of Transfer Agent Servicing Agreement* 10.8 Form of Fund Administration Servicing Agreement* 10.9 Index License Agreement* 10.10 Support Agreement* 23.1 Consent of Tait, Weller, & Baker, LLP, Independent Registered Public Accounting Firm(3) 23.2 Consent of Chapman and Cutler LLP is included in Exhibit 5.1* 24.1 Power of Attorney (included on signature page to this Registration Statement as filed herein)(3) 107 Filing Fee Table(2) (1) Previously filed as an exhibit to the Registrant s Registration Statement on Form S-1 (333-273364), filed on July 21, 2023 and incorporated by reference herein. (2) Previously filed as an exhibit to the Registrant s Registration Statement on Form S-1 (333-273364), filed on December 22, 2023 and incorporated by reference herein. (3) Filed herewith. * To be filed by amendment. Item 17. Undertakings. The undersigned Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. Provided, however, that: (1)(i), (ii), and (iii) of this section do not apply if the registration statement is on Form S-1, Form S-3, Form SF-3 or Form F-3 and the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or, as to a registration statement on Form S-3, Form SF-3 or Form F-3, is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold
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+PROSPECTUS SUMMARY This is only a summary of the prospectus and, while it contains material information about the Fund and its Shares, it does not contain or summarize all of the information about the Fund and the Shares contained in this prospectus which is material and/or which may be important to you. You should read this entire prospectus, including the "Risk Factors" discussion beginning on page [ ], before making an investment decision about the Shares. The Fund The 7RCC Spot Bitcoin and Carbon Credit Futures ETF (the "Fund"), a newly established series of Tidal Commodities Trust I (the "Trust"), is an exchange-traded fund. The Fund issues common shares of beneficial interest (the "Shares"), which represent units of fractional undivided beneficial interest in and ownership of the Fund. Tidal Investments LLC (the "Sponsor"), a Delaware limited liability company, is the Fund s sponsor. The Fund is a commodity pool for purposes of the Commodity Exchange Act of 1936, as amended (the "CEA"), and the Fund and the Sponsor are subject to regulation by the Commodity Futures Trading Commission (the "CFTC") and are registered with the National Futures Association ("NFA"). The Sponsor is registered with the NFA as a commodity pool operator ("CPO") and commodity trading advisor ("CTA"). The Fund is not an investment company as defined in the Investment Company Act of 1940, as amended (the "Investment Company Act"), and is not subject to regulation thereunder. Shareholders do not have the protections associated with ownership of shares in an investment company registered under the Investment Company Act. Offering of the Shares The Shares will be continuously offered under the Securities Act of 1933, as amended (the "Securities Act"). The Fund issues and redeems Shares at net asset value ("NAV") only in large, specified blocks each consisting of 10,000 Shares (each such block of shares called a "Basket," and collectively, the "Baskets"). The Fund s Baskets are generally issued ("Creation Baskets") and redeemed ("Redemption Baskets") for cash, and only to and from broker-dealers and large institutional investors that have entered into participation agreements ("Authorized Purchasers"). Subject to the Exchange receiving the necessary regulatory approval to permit the Fund to create and redeem Shares in-kind for bitcoin (the "In-Kind Regulatory Approval"), these transactions may also take place in exchange for bitcoin. The timing of the In-Kind Regulatory Approval is unknown, and there is no guarantee that the Exchange will receive the In-Kind Regulatory Approval at any point in the future. If the Exchange receives the In-Kind Regulatory Approval and if the Sponsor chooses to allow in-kind creations and redemptions, the Fund will notify the owners of the beneficial interests of Shares (the "Shareholders") in a prospectus supplement, in its periodic Exchange Act reports and on the Fund s website. Investment Objective The Fund s investment objective is to reflect the daily changes of the price in bitcoin and carbon credit futures contracts ("Carbon Credit Futures"), as represented by the 7RCC Kaiko Bitcoin Carbon Credit Index (the "Index"), less expenses from the Fund s operations. There can be no assurance that the Fund will achieve its investment objective or its investment strategy. Investment Strategy The Fund s investment strategy is to hold a combination of bitcoin and Carbon Credit Futures to replicate the performance of the Index. The Fund seeks these investments to reflect the daily changes in the price of bitcoin and Carbon Credit Futures, as represented in the Index. The Index is designed to track the performance of investing in a portfolio comprised of 80% bitcoin and 20% Carbon Credit Futures. The Index s Carbon Credit Futures are linked to the value of emissions allowances issued under the following regimes: the European Union Emissions Trading System ("EU ETS"), the California Cap and Trade ("CCA"), and Regional Greenhouse Gas Initiative ("RGGI"). To obtain exposure to the EU CEA, the Index uses Intercontinental Exchange ("ICE") EUA (Carbon Emission Allowances) futures ("EU CEA Carbon Credit Futures"). To obtain exposure to the CCA, the Index uses ICE California Carbon Allowance Vintage Future contracts ("CCA Carbon Credit Futures"). To obtain exposure to the RGGI, the Index uses ICE RGGI (CO2 allowances) futures contracts ("RGGI Carbon Credit Futures"). The Fund is a passive investment vehicle that does not seek to generate returns beyond tracking the returns of the Index. This means the Sponsor does not speculatively sell bitcoin and/or Carbon Credit Futures at times when prices are high or speculatively acquire such assets at low prices in the expectation of future price increases. Bitcoin and the Bitcoin Network Bitcoin is a digital commodity native to the Bitcoin Network. Bitcoin is not issued by any government, bank or central organization, and instead exist on the Bitcoin Network. Bitcoin transaction and ownership records are reflected on the Bitcoin Blockchain, which is a digital public record or ledger of all transactions completed on the Bitcoin Network. It is widely understood that no single entity owns or operates the Bitcoin Network. The Bitcoin Network is accessed through software, and software governs bitcoin creation, movement and ownership. The infrastructure of the Bitcoin Network is collectively maintained on a distributed basis by the Bitcoin Network s participants, consisting of: (i) validators or "miners," who run special software to validate transactions; (ii) "developers," who maintain and contribute updates to the Bitcoin Network s source code; and (iii) "users," who download and maintain on their individual computer a full or partial copy of the Bitcoin Blockchain and related software. Anyone can be a user, developer, or miner. The value of bitcoin is determined, in part, by the supply of, and demand for, bitcoin in the global markets for the trading of bitcoin, market expectations for the adoption of bitcoin as a decentralized store of value, the number of merchants and/or institutions that accept bitcoin as a form of payment, and the volume of peer-to-peer transactions, among other factors. Regulation Futures Market Regulation The regulation of futures markets, futures contracts, and futures exchanges has historically been comprehensive. The CFTC and the exchanges are authorized to take extraordinary actions in the event of a market emergency including, for example, the retroactive implementation of speculative position limits, increased margin requirements, the establishment of daily price limits and the suspension of trading on an exchange or trading facility. Pursuant to authority in the Commodity Exchange Act ("CEA"), the National Futures Association ("NFA") has been formed and registered with the Commodity Futures Trading Commission ("CFTC") as a registered futures association. At the present time, the NFA is the only self-regulatory organization ("SRO") for commodity interest professionals, other than futures exchanges. The CFTC has delegated to the NFA responsibility for the registration of CPOs and FCMs and their respective associated persons. The Sponsor and the Fund s clearing broker are members of the NFA. As such, they will be subject to NFA standards relating to fair trade practices, financial condition and consumer protection. The NFA also arbitrates disputes between members and their customers and conducts registration and fitness screening of applicants for membership and audits of its existing members. Neither the Trust nor the Fund is required to become a member of the NFA. The regulation of commodity interest transactions in the United States is a rapidly changing area of law and is subject to ongoing modification by governmental and judicial action. Considerable regulatory attention has been focused on non-traditional investment pools that are publicly distributed in the United States. There is a possibility of future regulatory changes within the United States altering, perhaps to a material extent, the nature of an investment in the Fund, or the ability of the Fund to continue to implement its investment strategy. In addition, various national governments outside of the United States have expressed concern regarding the disruptive effects of speculative trading in the commodities markets and the need to regulate the derivatives markets in general. The effect of any future regulatory change on the Fund is impossible to predict but could be substantial and adverse. The CFTC possesses exclusive jurisdiction to regulate the activities of commodity pool operators and commodity trading advisors with respect to "commodity interests," such as futures, swaps, and options, and has adopted regulations with respect to the activities of those persons and/or entities. Under the CEA, a registered commodity pool operator, such as the Sponsor, is required to make annual filings with the CFTC and the NFA describing its organization, capital structure, management and controlling persons. In addition, the CEA authorizes the CFTC to require and review books and records of, and documents prepared by, registered commodity pool operators. Pursuant to this authority, the CFTC requires commodity pool operators to keep accurate, current and orderly records for each pool that they operate. The CFTC may suspend the registration of a commodity pool operator (1) if the CFTC finds that the operator s trading practices tend to disrupt orderly market conditions, (2) if any controlling person of the operator is subject to an order of the CFTC denying such person trading privileges on any exchange, and (3) in certain other circumstances. Suspension, restriction or termination of the Sponsor s registration as a commodity pool operator would prevent it, until that registration were to be reinstated, from managing the Fund, and might result in the termination of the Fund if a successor sponsor is not elected pursuant to the Trust Agreement. Neither the Trust nor the Fund is required to be registered with the CFTC in any capacity. The Fund s investors are afforded prescribed rights for reparations under the CEA. Investors may also be able to maintain a private right of action for violations of the CEA. The CFTC has adopted rules implementing the reparation provisions of the CEA, which provide that any person may file a complaint for a reparations award with the CFTC for violation of the CEA against a floor broker or an FCM, introducing broker, commodity trading advisor, CPO, and their respective associated persons. The regulations of the CFTC and the NFA prohibit any representation by a person registered with the CFTC or by any member of the NFA, that registration with the CFTC, or membership in the NFA, in any respect indicates that the CFTC or the NFA has approved or endorsed that person or that person s trading program or objectives. The registrations and memberships of the parties described in this summary must not be considered as constituting any such approval or endorsement. Likewise, no futures exchange has given or will give any similar approval or endorsement. Trading venues in the United States are subject to varying degrees of regulation under the CEA depending on whether such exchange is a designated contract market (i.e. a futures exchange) or a swap execution facility. Clearing organizations are also subject to the CEA and the rules and regulations adopted thereunder as administered by the CFTC. The CFTC s function is to implement the CEA s objectives of preventing price manipulation and excessive speculation and promoting orderly and efficient commodity interest markets. In addition, the various exchanges and clearing organizations themselves as SROs exercise regulatory and supervisory authority over their member firms. THE FUND INVOLVES A HIGH DEGREE OF RISK AND PRESENTS MANY DIFFERENT RISKS THAN OTHER TYPES OF FUNDS, INCLUDING RISKS RELATED TO THE TAX TREATMENT OF SUCH INVESTMENT, BITCOIN OR INTERESTS RELATED TO BITCOIN OR CARBON CREDIT FUTURES. THE FUND IS RISKIER THAN OTHER EXCHANGE-TRADED PRODUCTS THAT DO NOT HOLD FINANCIAL INSTRUMENTS RELATED TO BITCOIN OR CARBON CREDIT FUTURES. THE FUND MAY NOT BE SUITABLE FOR SHAREHOLDERS THAT ARE NOT IN A POSITION TO ACCEPT MORE RISK THAN MAY BE INVOLVED WITH OTHER EXCHANGE-TRADED PRODUCTS. AS WITH ALL INVESTMENTS, AN INVESTOR IN THE FUND COULD POTENTIALLY LOSE THE FULL PRINCIPAL VALUE OF THEIR INVESTMENT. INVESTING IN SHARES INVOLVES SPEICAL RISKS THAT ARE DESCRIBED IN THE "RISK FACTORS" SECTION BEGINNING ON PAGE [ ] OF THIS PROSPECTUS. Neither the Trust nor the Fund is registered under the Investment Company Act of 1940, as amended (the "Investment Company Act") and therefore neither is subject to regulation thereunder. Shareholders do not have the protections associated with ownership of shares in an investment company registered under the Investment Company Act. See risk factor entitled "Shareholders do not have the protections associated with ownership of shares in an investment company registered under the Investment Company Act" in this Prospectus for more information. NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THE SECURITIES OFFERED IN THIS PROSPECTUS, OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THE COMMODITY FUTURES TRADING COMMISSION ("CFTC") HAS NOT PASSED UPON THE MERITS OF PARTICIPATING IN THIS COMMODITY POOL NOR HAS THE CFTC PASSED ON THE ADEQUACY OR ACCURACY OF THIS DISCLOSURE DOCUMENT. The Trust is an "emerging growth company" as that term is used in the Jumpstart Our Business Startups Act (the "Jobs Act") and, as such, may elect to comply with certain reduced reporting requirements. The Shares are neither interests in nor obligations of the Sponsor, or the Trustee (each as defined herein). The Shares are not insured by the Federal Deposit Insurance Corporation or any other governmental agency. This Prospectus has two parts: a disclosure document and a statement of additional information. These parts are bound together and both contain important information. The date of this prospectus is [ _______, ____]. "Index"—7RCC Kaiko Bitcoin Carbon Credit Index. "Indirect Participants"—Those banks, brokers, dealers, trust companies and others who clear through or maintain, either directly or indirectly, a custodial relationship with a DTC Participant. "Investment Advisers Act"—Investment Advisers Act of 1940, as amended. "Investment Company Act"—Investment Company Act of 1940, as amended. "IRA"—An individual retirement account provided for under Section 408(m) of the Code. "IRS"—The U.S. Internal Revenue Service, a bureau of the U.S. Department of the Treasury. "Kaiko"— Invierno AB, Reg. No. 559207-4172, Box 5193, 10244 Stockholm, Sweden. "Management Fee"—A fee in an amount equal to 0.68% per annum of the daily NAV of the Fund, paid monthly in arrears, in consideration of the Sponsor s services related to the management of the Fund s business and affairs. "Marketing Agent"— Foreside Fund Services, LLC, a wholly-owned subsidiary of Foreside Financial Group, LLC (d/b/a ACA Group), which is engaged by the Sponsor and is responsible for the marketing of the Shares. "Marketing Fee"—Fee payable to the Marketing Agent for services it provides to the Fund, which the Sponsor shall pay to the Marketing Agent as a Sponsor-paid Expense. "NAV"—The net asset value of the Fund. "NFA"—The National Futures Association. "Non-Digital Custodian"— U.S Bank, N.A. "OTC"—Over-the-counter. "Redemption Basket"—Baskets of Shares redeemed in exchange for cash in an amount equal to the Fund s NAV on a per Share basis for each such Redemption Basket. "SEC"—The U.S. Securities and Exchange Commission. "Securities Act"—The Securities Act of 1933, as amended. "Service Providers"—Collectively, the Sponsor, the Trustee, the Bitcoin Advisers, the Transfer Agent, the Administrator, the Custodians, the Marketing Agent and the FCMs. "Shareholder"—Any owner of Shares. "Shares"—Common units of fractional undivided beneficial interest in, and ownership of, the Fund. "SIPC"—The Securities Investor Protection Corporation. "Solactive" — Solactive AG. "Sponsor"—Tidal Investments LLC, a Delaware limited liability company, which is registered as a Commodity Pool Operator. "Sponsor-paid Expense(s)"— The Fund s fees and expenses that the are deducted from the Management Fee: the Marketing Fee, the Administrator Fee, the fees of the Custodians, the Transfer Agent Fee, the Trustee fee, applicable license fees, including the licensing fees related to the Index License Agreement, fees and expenses related to trading of Shares on the Exchange (including marketing, legal and audit fees and expenses), legal expenses, audit fees, regulatory fees, including any fees relating to the registration of the Shares with the SEC, printing and mailing costs and costs of maintaining the Trust s website. "SROs"—Self-regulatory organizations. "Sub-Administrator"— U.S. Bank Global Fund Services ("Global Fund Services"). Bitcoin has only a physical existence in the record of transactions on the Bitcoin Blockchain. The Bitcoin Blockchain is a public record of the creation, custody and flow of funds of bitcoin, showing every transaction effected on the Bitcoin Blockchain among users online "digital wallets" where their bitcoin are effectively stored. Miners authenticate and bundle bitcoin transactions sequentially into files called "blocks," which requires performing computational work to solve a cryptographic puzzle set by the Bitcoin Network s software protocol. Since each solved block contains a reference to the previous block, they form a chronological "chain" back to the first bitcoin transaction. Copies of the Bitcoin Blockchain are stored in a decentralized manner on the computers of each individual Bitcoin Network full node (i.e., any user who chooses to maintain on their computer a full copy of the Bitcoin Blockchain, as well as related software). Each bitcoin is associated with a set of unique cryptographic "keys," in the form of a string of numbers and letters, which allow whoever is in possession of the private key to assign that bitcoin in a transfer that the Bitcoin Network will recognize. Bitcoin may be sent or received through users digital wallets by using public and private keys that are part of the Bitcoin Network s cryptographic security mechanism. The Bitcoin Network is a technological innovation developed in the last fifteen years, and the bitcoin that are created, transferred, used and stored by entities and individuals have certain features associated with several types of assets, most notably commodities and currencies. Many U.S. regulators, including the Financial Crimes Enforcement Network of the U.S. Department of the Treasury ("FinCEN"), the CFTC, the U.S. Internal Revenue Service ("IRS"), and state regulators, including the New York Department of Financial Services ("NYDFS"), have made official pronouncements or issued guidance or rules regarding the treatment of bitcoin and other digital currencies. However, other U.S. and state agencies have not made official pronouncements or issued guidance or rules regarding the treatment of bitcoin. Similarly, the treatment of bitcoin and other digital currencies is often uncertain or contradictory in other countries. The regulatory uncertainty surrounding the treatment of bitcoin creates risks for the Fund and its Shares. See "Risk Factors—Risks Related to Bitcoin, the Bitcoin Network and Bitcoin Trading Markets." Bitcoin Valuation The value of bitcoin is determined by the value that various digital asset market participants place on bitcoin through their transactions. The most common means of determining the value of a bitcoin is by surveying one or more digital asset exchanges where bitcoin is traded publicly and transparently. On exchanges, bitcoin is traded with publicly disclosed valuations for each executed trade, measured by one or more fiat currencies such as the U.S. dollar. OTC dealers or market makers do not typically disclose their data. There are many digital asset exchanges operating worldwide, representing a substantial percentage of bitcoin buying and selling activity, and providing the most data with respect to prevailing valuation of bitcoin. The Fund uses the same methodology as utilized by the Index to determine the value of its bitcoin. Digital asset trading platforms meeting the criteria set out by Kaiko, i.e., the Index Pricing Sources, are used to value bitcoin. Kaiko reviews the time-weighted average price from 3:00 p.m. ET to 4:00 p.m. ET on all eligible digital asset trading platforms and values bitcoin as the median value amongst the eligible digital asset platforms. The Sponsor believes this methodology provides a reasonable valuation of the spot price of bitcoin that is reasonably resistant to price manipulation of bitcoin. Purchases and Sales of Bitcoin Because the Fund will conduct creations and redemptions of Shares for cash, it will be responsible for purchasing and selling bitcoin in connection with those creation and redemption orders. The Fund may also be required to sell bitcoin to pay certain extraordinary, non-recurring expenses that are not assumed by the Sponsor. The Sponsor, on behalf of the Fund, is responsible for acquiring bitcoin from a bitcoin trading counterparty that has been approved by, and entered into an agreement with, the Sponsor (each, a "Bitcoin Trading Counterparty"), currently JSCT, LLC (which is an affiliate of Jane Street Capital, LLC, an Authorized Purchaser for the Fund), DV Chain, LLC and Gemini. The Bitcoin Trading Counterparties with which the Sponsor will engage in bitcoin transactions are unaffiliated third parties and all transactions will be done on an arm s-length basis. When seeking to purchase or sell bitcoin on behalf of the Fund, the Sponsor will typically seek to buy and sell bitcoin at a price as close to the Bitcoin Price (defined below) as practical from any of the approved Bitcoin Trading Counterparties. The Sponsor maintains a process for approving and monitoring Bitcoin Trading Counterparties, and all Bitcoin Trading Counterparties must be approved by the Sponsor before the Fund will engage in any transactions with the entity. The Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act") was enacted in response to the economic crisis of 2008 and 2009 and it significantly altered the regulatory regime to which the securities and commodities markets are subject. To date, the CFTC has issued proposed or final versions of almost all of the rules it is required to promulgate under the Dodd-Frank Act, and it continues to issue proposed versions of additional rules that it has authority to promulgate. Provisions of the new law include the requirement that position limits be established on a wide range of commodity interests, including agricultural, energy, and metal-based commodity futures contracts, options on such futures contracts and uncleared swaps that are economically equivalent to such futures contracts and options ("Reference Contracts"); new registration and recordkeeping requirements for swap market purchasers; capital and margin requirements for "swap dealers" and "major swap," as determined by the new law and applicable regulations; reporting of all swap transactions to swap data repositories; and the mandatory use of clearinghouse mechanisms for sufficiently standardized swap transactions that were historically entered into in the OTC market, but are now designated as subject to the clearing requirement; and margin requirements for OTC swaps that are not subject to the clearing requirements. In addition, considerable regulatory attention has recently been focused on non-traditional publicly distributed investment pools such as the Fund. Furthermore, various national governments have expressed concern regarding the disruptive effects of speculative trading in certain commodity markets and the need to regulate the derivatives markets in general. The effect of any future regulatory change on the Funds is impossible to predict but could be substantial and adverse. The Dodd-Frank Act was intended to reduce systemic risks that may have contributed to the 2008/2009 financial crisis. Since the first draft of what became the Dodd-Frank Act, supporters and opponents have debated the scope of the legislation. As the Administrations of the U.S. change, the interpretation and implementation will change along with them. Nevertheless, regulatory reform of any kind may have a significant impact on U.S. regulated entities. Spot Market Transactions Spot markets, on the other hand, are largely unregulated and rely on pricing sources that track over-the-counter (OTC) transactions. For cryptoassets, including bitcoin, these OTC transactions are relatively new and usually take place in the so-called crypto exchanges or digital asset trading platforms. Digital asset trading platforms are relatively new and, in some cases, unregulated. Furthermore, while many prominent digital asset trading platforms provide the public with significant information regarding their ownership structure, management teams, corporate practices and regulatory compliance, many digital asset trading platforms do not provide this information. Digital asset trading platforms do not appear to be subject to, or may not comply with, regulation in a similar manner as other regulated trading platforms, such as national securities trading platforms or designated contract markets. These markets are local, national and international and include a broadening range of digital assets and participants. Significant trading may occur on systems and platforms with minimum predictability. Furthermore, many spot markets and over-the-counter market venues do not provide the public with significant information regarding their ownership structure, management teams, corporate practices or oversight of customer trading. As a result, the marketplace may lose confidence in digital asset trading platforms, including prominent trading platforms that handle a significant volume of bitcoin trading. Many digital asset trading platforms are unlicensed, unregulated, operate without extensive supervision by governmental authorities, and do not provide the public with significant information regarding their ownership structure, management team, corporate practices, cybersecurity, and regulatory compliance. In particular, those located outside the United States may be subject to significantly less stringent regulatory and compliance requirements in their local jurisdictions. As a result, trading activity on or reported by these digital asset trading platforms is generally significantly less regulated than trading in regulated U.S. securities and commodities markets, and may reflect behavior that would be prohibited in regulated U.S. trading venues. Position Limits, Aggregation Limits, Price Fluctuation Limits The CFTC and US futures exchanges impose limits on the maximum net long or net short speculative positions that any person may hold or control in any particular futures or options contracts traded on US futures exchanges. For example, the CFTC currently imposes speculative position limits on cryptocurrencies and a number of commodities (e.g., corn, oats, wheat, soybeans and cotton) and US futures exchanges currently impose speculative position limits on many other commodities. The Fund could be required to liquidate positions it holds in order to comply with position limits or may not be able to fully implement trading instructions in order to track its index, the 7RCC Kaiko Bitcoin Carbon Credit Index (the "Index") in order to comply with position limits. Any such liquidation or limited implementation could result in substantial costs to the Fund and the Fund s performance to deviate from that of the Index. The Dodd-Frank Act significantly expanded the CFTC s authority to impose position limits with respect to futures contracts and options on futures contracts, swaps that are economically equivalent to futures or options on futures, and swaps that are traded on a regulated exchange and certain swaps that perform a significant price discovery function. The aggregate position limits currently in place under the current position limits and the Aggregation Requirements are as follows for each of the carbon credit futures contracts traded by the Fund: Carbon Credit Futures Contract Spot Month Position Limit All Month and Single Month (excluding spot month) Aggregate Accountability Level Intercontinental Exchange ("ICE") EUA (Carbon Emission Allowances) futures contracts ICE California Carbon Allowance Vintage Future contracts ICE RGGI (CO2 allowances) futures contracts COMMODITY FUTURES TRADING COMMISSION RISK DISCLOSURE STATEMENT YOU SHOULD CAREFULLY CONSIDER WHETHER YOUR FINANCIAL CONDITION PERMITS YOU TO PARTICIPATE IN A COMMODITY POOL. IN SO DOING, YOU SHOULD BE AWARE THAT COMMODITY INTEREST TRADING CAN QUICKLY LEAD TO LARGE LOSSES AS WELL AS GAINS. SUCH TRADING LOSSES CAN SHARPLY REDUCE THE NET ASSET VALUE OF THE COMMODITY POOL AND CONSEQUENTLY THE VALUE OF YOUR INTEREST IN THE COMMODITY POOL. IN ADDITION, RESTRICTIONS ON REDEMPTIONS MAY AFFECT YOUR ABILITY TO WITHDRAW YOUR PARTICIPATION IN THE COMMODITY POOL. FURTHER, COMMODITY POOLS MAY BE SUBJECT TO SUBSTANTIAL CHARGES FOR MANAGEMENT, AND ADVISORY AND BROKERAGE FEES. IT MAY BE NECESSARY FOR THOSE COMMODITY POOLS THAT ARE SUBJECT TO THESE CHARGES TO MAKE SUBSTANTIAL PROFITS TO AVOID DEPLETION OR EXHAUSTION OF THEIR ASSETS. THIS DISCLOSURE DOCUMENT CONTAINS A COMPLETE DESCRIPTION OF EACH EXPENSE TO BE CHARGED BY THIS COMMODITY POOL AT PAGE [ ] AND A STATEMENT OF THE PERCENTAGE RETURN NECESSARY TO BREAK EVEN, THAT IS, TO RECOVER THE AMOUNT OF YOUR INITIAL INVESTMENT, AT PAGE [ ]. THIS BRIEF STATEMENT CANNOT DISCLOSE ALL THE RISKS AND OTHER FACTORS NECESSARY TO EVALUATE YOUR PARTICIPATION IN THIS COMMODITY POOL. THEREFORE, BEFORE YOU DECIDE TO PARTICIPATE IN THIS COMMODITY POOL, YOU SHOULD CAREFULLY STUDY THIS PROSPECTUS, INCLUDING A DESCRIPTION OF THE MATERIAL RISK FACTORS OF THIS INVESTMENT, AT PAGE [ ]. YOU SHOULD ALSO BE AWARE THAT THIS COMMODITY POOL MAY ENGAGE IN OFF-EXCHANGE FOREIGN CURRENCY TRADING. SUCH TRADING IS NOT CONDUCTED IN THE INTERBANK MARKET. THE FUNDS THAT THE POOL USES FOR OFF-EXCHANGE FOREIGN CURRENCY TRADING WILL NOT RECEIVE THE SAME PROTECTIONS AS FUNDS USED TO MARGIN OR GUARANTEE EXCHANGETRADED FUTURES AND OPTION CONTRACTS. IF THE POOL DEPOSITS SUCH FUNDS WITH A COUNTERPARTY AND THAT COUNTERPARTY BECOMES INSOLVENT, THE POOL S CLAIM FOR AMOUNTS DEPOSITED OR PROFITS EARNED ON TRANSACTIONS WITH THE COUNTERPARTY MAY NOT BE TREATED AS A COMMODITY CUSTOMER CLAIM FOR PURPOSES OF SUBCHAPTER IV OF CHAPTER 7 OF THE BANKRUPTCY CODE AND THE REGULATIONS THEREUNDER. THE POOL MAY BE A GENERAL CREDITOR AND ITS CLAIM MAY BE PAID, ALONG WITH THE CLAIMS OF OTHER GENERAL CREDITORS, FROM ANY MONIES STILL AVAILABLE AFTER PRIORITY CLAIMS ARE PAID. EVEN POOL FUNDS THAT THE COUNTERPARTY KEEPS SEPARATE FROM ITS OWN FUNDS MAY NOT BE SAFE FROM THE CLAIMS OF PRIORITY AND OTHER GENERAL CREDITORS. TIDAL INVESTMENTS LLC ("TIDAL") IS A MEMBER OF NFA AND IS SUBJECT TO NFA S REGULATORY OVERSIGHT AND EXAMINATIONS. TIDAL HAS ENGAGED OR MAY ENGAGE IN UNDERLYING OR SPOT VIRTUAL CURRENCY TRANSACTIONS IN A COMMODITY POOL. ALTHOUGH NFA HAS JURISDICTION OVER TIDAL AND ITS COMMODITY POOL, YOU SHOULD BE AWARE THAT NFA DOES NOT HAVE REGULATORY OVERSIGHT AUTHORITY FOR UNDERLYING OR SPOT MARKET VIRTUAL CURRENCY PRODUCTS OR TRANSACTIONS OR VIRTUAL CURRENCY EXCHANGES, CUSTODIANS OR MARKETS. YOU SHOULD ALSO BE AWARE THAT GIVEN CERTAIN MATERIAL CHARACTERISTICS OF THESE PRODUCTS, INCLUDING LACK OF A CENTRALIZED PRICING SOURCE AND THE OPAQUE NATURE OF THE VIRTUAL CURRENCY MARKET, THERE CURRENTLY IS NO SOUND OR ACCEPTABLE PRACTICE FOR NFA TO ADEQUATELY VERIFY THE OWNERSHIP AND CONTROL OF A VIRTUAL CURRENCY OR THE VALUATION ATTRIBUTED TO A VIRTUAL CURRENCY BY TIDAL. "Swap Agreement"—An OTC derivative that generally involved an exchange of a stream of payments between the contracting parties based on a notional amount and a specified index. "Transfer Agent"—Global Fund Services. "Transfer Agent Fee"—Fee payable to the Transfer Agent for services it provides to the Trust, which the Sponsor shall pay to the Transfer Agent as a Sponsor-paid Expense. "Treasury Securities"—Fixed-income assets issued by the United States Treasury Department. "Trust"—Tidal Commodities Trust I, a Delaware statutory trust under the DSTA and the pursuant to the Trust Agreement. "Trust Agreement"—The First Amended and Restated Declaration of Trust and Trust Agreement between the Trustee and the Sponsor establishing and governing the operations of the Trust dated as of March 10, 2023, as the same may be amended from time to time. "Trustee"—Wilmington Trust, National Association, the Delaware trustee of the Trust. "U.S. Dollar" or "$"—United States Dollar or Dollars. "Vault Balance"—One or more storage accounts in the name of the Sponsor and of the Fund held for the safekeeping of the Fund s bitcoin. "VCMs"—Voluntary carbon markets. Carbon Credit Futures Futures contracts are standardized contracts that obligate the parties to buy or sell an asset at a predetermined price and date in the future. The Carbon Credit Futures that comprise the sleeve of the Index are linked to the value of emissions allowances issued under the EU ETS, CCA and RGGI. Commodity futures contracts linked to the value of emission allowances are known as "carbon credit futures". The Fund will invest in the Carbon Credit Futures that comprise the Index directly, specifically, EU CEA Carbon Credit Futures, CCA Carbon Credit Futures and RGGI Carbon Credit Futures. The Fund does not intend to invest in carbon credit futures specifically linked to bitcoin mining or other related processes. As explained below, the Index rolls its Carbon Credit Futures contracts prior to the expiration of such contract in December. One factor determining the total return from investing in futures contracts is the price relationship between soon to expire contracts and later to expire contracts. Under certain market conditions, the Fund may have to pay more for longer maturity contracts to replace existing shorter maturity contracts about to expire. This situation is known as "contango" in the futures markets. In the event of a prolonged period of contango, and absent the impact of rising or falling prices for Carbon Credit Futures contracts, this could have a negative impact on the Fund s NAV and total return, which in turn may have a negative impact on your investment in the Fund. Alternatively, the market for Carbon Credit Futures contracts may be in a state of backwardation (i.e., when the price of the futures contract in the future is less than the current price), in which case the Fund will buy later-to-expire contracts for a lower price than the soon-to-expire contracts it sells. The Index is comprised of futures contracts on emissions allowances issued by various "cap-and-trade" regulatory regimes that seek to reduce greenhouse gas ("GHG") emissions over time. A cap-and-trade regime typically involves a regulator setting a limit on the total amount of specific greenhouse gasses (such as CO2) that can be emitted by regulated entities. Capping and reducing the cap on GHGs is viewed as a key policy tool in reaching climate change objectives. The regime is designed to promote sustainable development by putting a price on carbon emissions. The regulator will then issue or sell "emissions allowances" to regulated entities, which in turn may buy or sell the emissions allowances to the open market. To the extent that the regulator may then reduce the cap on emission allowances, regulated entities are incentivized to reduce their emissions; otherwise, they must purchase additional emission allowances on the open market, where the price of such allowances will likely be increasing as a result of demand, and regulated entities that reduce their emissions will be able to sell unneeded emission allowances for profit. An emission allowance or carbon credit is a unit of emissions (typically one ton of CO2) that the owner of the allowance or credit is permitted to emit. Futures contracts linked to the value of emission allowances are known as "carbon credit futures". The Index The Index provides exposure to the daily price performance of bitcoin and Carbon Credit Futures by aiming to track the financial performance of investing in a portfolio of 80% bitcoin and 20% Carbon Credit Futures. In providing this exposure, the Index seeks to provide exposure to bitcoin with an environmentally responsible approach with exposure to carbon credits. Invierno AB, Reg. No. 559207-4172, Box 5193, 10244 Stockholm, Sweden ("Kaiko") is the index provider, benchmark administrator and calculates the price of bitcoin used by the Index. Kaiko is also the central recipient of input data and evaluates the integrity and accuracy of the input data. Solactive AG ("Solactive") is calculation agent of the Index, and is also the index provider for each of the sub-indexes that comprise the Index, as detailed below. To calculate the value of bitcoin, Kaiko selects digital asset trading platforms meeting specific criteria (the "Index Pricing Sources") and takes the time-weighted average price from 3:00 pm ET to 4:00 pm ET on each Index Pricing Source. Kaiko then calculates the median price across the Index Pricing Sources to determine the value of bitcoin (the "Bitcoin Price"). The Carbon Credit Futures portion of the Index is built using a combination of three carbon credit indices, each of which is calculated and administered by Solactive: Solactive Future Series European Carbon Credit Rolling Futures Index (the "European Sub-index"), Solactive Future Series California Carbon Rolling Futures Index (the "California Sub-index"), and the Solactive Future Series Regional Greenhouse Gas Rolling Futures Index (the "RGGI Sub-index" and, collectively with the European Sub-index and the California Sub-index, the "Sub-indexes"). The three underlying Sub-indexes provides the Index with returns tied to futures contracts on carbon credits connected to EU ETS, CCA and RGGI. The Fund s Carbon Credit Futures will not result in any direct participation by the Fund in any particular carbon emissions offsetting project, including any carbon emissions associated with the mining of bitcoin or the Fund s bitcoin holdings. The Sub-indexes include only Carbon Credit Futures that mature in the upcoming December. Each Sub-index includes front-month futures contracts that are rolled over a five-day period prior to the expiration of the current-year futures contract and rolls into a contract with an expiration date of December of the immediately following year. The Index rebalances quarterly to maintain the 80:20 percent ratio between bitcoin and Carbon Credit Futures in March, June, September and December. The December rebalance of the Index is the business day that immediately follows the December rolling of futures contracts of the Sub-indexes. The CFTC has attempted to exercise authority to enact additional and more restricted speculative position limits with respect to futures and options on futures on so-called "exempt commodities" (which includes most energy and metals contracts) and with respect to agricultural commodities, but those proposed limits were vacated by a United States District Court. The CFTC has once again attempted to enact additional and more restrictive limits. For a discussion generally regarding the risks that position limits may pose for the Fund, see the "RISK FACTORs" section and related disclosure regarding position limits, accountability levels and dynamic price fluctuation limits. With the exception of the nine legacy agricultural contracts, the CFTC s position limits would apply only in the spot month. These limits would generally be set at 25 percent of the deliverable supply but may be higher or lower for certain contracts. With respect to the non-legacy contracts, the rule would require the relevant exchange on which the contracts are traded to adopt either position limits or position accountability levels. The proposed rules also would expand the current list of enumerated bona fide hedges to include, for example, hedges of anticipated merchandizing. To provide market purchasers with greater flexibility on managing their business risks, the proposal also provides guidance on whether and when market purchasers are permitted to measure risk on a gross basis rather than a net basis. However, firms will be required to measure risk on a consistent basis. Enumerated hedges are self-effectuating. That is, no prior approval would be required from the CFTC, although a market purchaser would be required to obtain approval from the relevant exchange. Self-effectuating hedge exemptions also would be available for other transactions such as spreads and pass-through swaps as approved by exchanges. With respect to non-enumerated hedge exemptions, a market purchaser would be required to file a request to exceed the position limit with the relevant exchange. If the exchange grants the request for a non-enumerated hedge exemption, the exchange will forward its decision to the CFTC for review. The exemption will be deemed granted provided the CFTC does not intervene during a 10-day review period. The market purchaser would not be permitted to exceed the applicable position limit until the 10-day review period lapses. Importantly, the CFTC may act solely through its commissioners and not through staff. In terms of process changes, the CFTC is proposing to eliminate Form 204 cash positions report and the cash information reported under Form 304. Comments on the proposed rule must be submitted no later than 90 days after approval of the proposal by the CFTC (i.e., April 29, 2020). The CFTC does not intend to extend the comment period. It is unknown at this time the effect that such passage, adoption or modification will have, positively or negatively, on the industry or on the Fund. The size or duration of positions available to the Fund may be severely limited. Pursuant to the CFTC s and the exchanges aggregation requirements, all accounts owned or managed by the Sponsor are likely to be combined for speculative position limits purposes. The Fund could be required to liquidate positions it holds in order to comply with such limits or may not be able to fully implement trading instructions generated by its trading models, in order to comply with such limits. Any such liquidation or limited implementation could result in substantial costs to the Fund. These new regulations and the resulting increased costs and regulatory oversight requirements may result in market purchasers being required or deciding to limit their trading activities, which could lead to decreased market liquidity and increased market volatility. In addition, transaction costs incurred by market purchasers are likely to be higher due to the increased costs of compliance with the new regulations. These consequences could adversely affect the Fund s returns. FCMs The CEA requires all FCMs, such as the Fund s clearing brokers, to meet and maintain specified fitness and financial requirements, to segregate customer funds from proprietary funds and account separately for all customers funds and positions, and to maintain specified books and records open to inspection by the staff of the CFTC. The CFTC has similar authority over introducing brokers, or persons who solicit or accept orders for commodity interest trades but who do not accept margin deposits for the execution of trades. The CEA authorizes the CFTC to regulate trading by FCMs and by their officers and directors, permits the CFTC to require action by exchanges in the event of market emergencies, and establishes an administrative procedure under which customers may institute complaints for damages arising from alleged violations of the CEA. The CEA also gives the states powers to enforce its provisions and the regulations of the CFTC. THIS PROSPECTUS DOES NOT INCLUDE ALL OF THE INFORMATION OR EXHIBITS IN THE REGISTRATION STATEMENT OF THE FUND. INVESTORS CAN READ AND COPY THE ENTIRE REGISTRATION STATEMENT AT THE PUBLIC REFERENCE FACILITIES MAINTAINED BY THE SEC IN WASHINGTON, D.C. THE FUND WILL FILE QUARTERLY AND ANNUAL REPORTS WITH THE SEC. INVESTORS CAN READ AND COPY THESE REPORTS AT THE SEC PUBLIC REFERENCE FACILITIES IN WASHINGTON, D.C. PLEASE CALL THE SEC AT 1-800-SEC-0330 FOR FURTHER INFORMATION. THE FILINGS OF THE TRUST ARE POSTED AT THE SEC WEBSITE AT WWW.SEC.GOV. REGULATORY NOTICES NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE TRUST, THE FUND, THE SPONSOR, THE AUTHORIZED PARTICIPANTS OR ANY OTHER PERSON. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR SOLICITATION TO SELL OR A SOLICITATION OF AN OFFER TO BUY, NOR SHALL THERE BE ANY OFFER, SOLICITATION, OR SALE OF THE SHARES IN ANY JURISDICTION IN WHICH SUCH OFFER, SOLICITATION, OR SALE IS NOT AUTHORIZED OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE ANY SUCH OFFER, SOLICITATION, OR SALE. AUTHORIZED PARTICIPANTS MAY BE REQUIRED TO DELIVER A PROSPECTUS WHEN TRANSACTING IN SHARES. SEE "PLAN OF DISTRIBUTION" IN PART ONE OF THIS PROSPECTUS. Risk Summary An investment in the Fund involves a high degree of risk uncertainty. Some of the risks associated with an investment in the Fund are summarized below. A more extensive discussion of these risks appears in the section titled "Risk Factors" which begins on page [ ]. These risks include, but are not limited to, the following: Risks Related to Bitcoin, the Bitcoin Network and Bitcoin Trading Markets The trading prices of many digital assets, including bitcoin, have experienced extreme volatility in recent periods and may continue to do so. The Fund invests 80% of its assets in bitcoin, the value of which is highly volatile and subject to fluctuations due to a number of factors. Future volatility, including declines in the trading prices of bitcoin, could have a material adverse effect on the value of Shares, and Shares could lose significant value. Digital assets represent a new and rapidly evolving industry, and the value of the Shares in part depends on the acceptance of bitcoin. Competition from the emergence or growth of other digital assets or methods of investing in bitcoin could negatively impact the price of bitcoin and therefore the value of the Shares. The value of Shares is subject to a number of factors relating to the fundamental investment characteristics of bitcoin as a digital asset including the fact that digital assets such as bitcoin are bearer instruments and loss, theft, destruction or compromise of associate private keys could result in permanent loss of the asset. Due to the unregulated nature and lack of transparency surrounding the operations of digital asset exchanges, they may experience fraud, security failures or operational problems, which may adversely affect the value of bitcoin and, consequently, the value of the Shares. The impact of geopolitical or economic events on the supply and demand for bitcoin is uncertain, but could motivate large-scale sales of bitcoin, which could result in a reduction in the value of bitcoin, and the Shares. Changes in the governance of a digital asset network may not receive sufficient support from users and miners, which may negatively affect that digital asset network s ability to grow and respond to changes. Risks Related to the Custody of Bitcoin Failure to safeguard and manage the Fund s bitcoin could adversely impact the value of Shares. Security threats to the Fund s account with the Bitcoin Custodian could result in the halt of Fund operations, a loss of Fund assets, or damage to the Fund s reputation, among others. Any of these factors could result in a reduction in the price of Shares. Due to the nature of private keys, bitcoin transactions are irrevocable, and stolen or incorrectly transferred bitcoin may be irretrievable. Any incorrectly executed bitcoin transactions could adversely affect an investment in the Fund. Loss, theft, destruction or compromise of private keys could result in permanent loss of the asset. The lack of full insurance and Shareholders limited rights of legal recourse against the Fund, Trustee, Administrator, and/or the Bitcoin Custodian exposes the Fund and its shareholders to the risk of loss of the Fund s bitcoin, for which no person or entity is liable. Risks Related to the Regulation of Bitcoin Digital asset markets in the U.S. exist in a state of regulatory uncertainty, and adverse legislative or regulatory developments could significantly harm the value of bitcoin or the Shares, such as by banning, restricting or imposing onerous conditions or prohibitions on the use of bitcoin, mining activity, digital wallets, the provision of services related to trading and custodying bitcoin, the operation of the Bitcoin Network, or the digital asset markets generally. The U.S. federal income tax treatment of transactions in digital assets is unclear. Risks Related to Carbon Credit Futures and the Fund s Status as a Commodity Pool There is no assurance that cap-and-trade regimes will continue to exist. New technologies may arise that diminish or eliminate the need for cap-and-trade markets. Emissions limits allocations may not properly reflect the amount needed for a stable price of credits, which can lead to large price volatility. 7RCC Spot Bitcoin and Carbon Credit Futures ETF STATEMENT OF ADDITIONAL INFORMATION TABLE OF CONTENTS Regulation 2 Futures Market Regulation 2 Spot Market Transactions 3 Position Limits, Aggregation Limits, Price Fluctuation Limits 3 FCMs 4 Potential Advantages of Investment 5 Interest Income and Expense. 5 Fund Performance On November 14, 2013, the CFTC published final regulations that require enhanced customer protections, risk management programs, internal monitoring and controls, capital and liquidity standards, customer disclosures and auditing and examination programs for FCMs. The rules are intended to afford greater assurances to market purchasers that customer segregated funds and secured amounts are protected, customers are provided with appropriate notice of the risks of futures trading and of the FCMs with which they may choose to do business, FCMs are monitoring and managing risks in a robust manner, the capital and liquidity of FCMs are strengthened to safeguard the continued operations and the auditing and examination programs of the CFTC and the SROs are monitoring the activities of FCMs in a thorough manner. Potential Advantages of Investment Interest Income and Expense. Unlike some alternative investment funds, the Fund does not borrow money in order to obtain leverage, so the Fund does not incur any interest expense. Rather, the Fund s margin deposits, and cash reserves are maintained in cash and cash equivalents and interest is generally earned on available assets, which include unrealized profits credited to the Fund s accounts. Fund Performance As of the date of this prospectus, the Fund has not yet commenced trading and does not have any performance history. Legislative or regulatory changes may impact the operation of the Fund, the regulation and enforcement of cap-and-trade regimes, the competitive landscape and/or market behavior regarding cap-and-trade regimes. New regulation relating to cap-and-trade markets may arise, which could negatively impact the value underlying carbon credits, the liquidity of said markets and the Fund. Investments in commodity-linked derivatives, such as Carbon Credit Futures, involve risks that are greater than, and different from, investing directly in the referenced commodity. Commodity-linked derivatives may also be subject to greater price volatility than the underlying reference asset. The Fund obtains exposure to Carbon Credit Futures with multiple geographic focuses, and accordingly is subjected to the accompanying geographic risks. The Fund may also experience risks related to the energy, agriculture and metal sectors, among others, in connection with its exposure to Carbon Credit Futures. In some cases, the near-month Carbon Credit Futures price will be lower than the next month s contract prices (i.e., "contango"). In the event of a prolonged period of contango, and absent the impact of rising or falling prices of the underlying carbon credit, this could have a significant negative impact on the Fund s NAV and total return, and you could incur a partial or total loss of your investment in the Fund. Position limits and margin requirements, among other limitations, may have the potential to cause tracking error, which could cause the price of Shares to substantially vary from the Index. The Fund utilizes futures commission merchants ("FCMs") to buy and sell its futures contracts. Volatility in the Carbon Credit Futures may lead its FCMs to impose risk mitigation procedures that could limit the Fund s investment in Carbon Credit Futures beyond the accountability or position limits imposed by the futures contract exchange. An FCM could impose a financial ceiling on initial margin that could change and become more or less restrictive on the Fund s activities depending upon a variety of conditions beyond the Sponsor s control. If the Fund s current FCMs were to impose position limits, or if any other FCM with which the Fund establishes a relationship in the future were to impose position limits, the Fund s ability to meet its investment objective could be negatively impacted. The Fund continues to monitor and manage its existing relationships with its FCMs and will continue to seek additional relationships with FCMs as needed. The Fund is deemed a "commodity pool" and is therefore subject to regulation under the CEA and CFTC rules. The Fund and the Sponsor, as the Fund s CPO, is subject to additional laws, regulations and enforcement policies, all of which may affect the operations of the Fund. Regulation in the commodity-linked derivatives markets is extensive and constantly changing. Future regulatory developments are impossible to predict, but may significantly and adversely affect the operations and value of the Fund. Risks Related to the Index The Index has a limited history. The Bitcoin Price could fail to track the global bitcoin price and a failure of the Bitcoin Price could adversely affect the value of Shares. The price used by the Index to calculate the value of bitcoin may be volatile, which could adversely affect the value of Shares. The Index price being used to determine the net asset value of the Fund may not be consistent with GAAP. To the extent the Fund s financial statements are determined using a different pricing source that is consistent with GAAP, the NAV reported in the Fund s periodic financial statements may differ, and may differ significantly, from the Fund s NAV determined using the pricing of the Index. Risks Related to the Fund and the Shares The Fund is new and an investment in the Fund may have more risks than an investment in an established, larger fund. Further, the Sponsor and its management have a limited history of operating investment vehicles like the Fund. The Fund has a limited number of financial institutions that may act as Authorized Purchasers. If regulatory changes or interpretations of an Authorized Purchaser s, the Fund s or the Sponsor s require the regulation of an Authorized Purchaser, the Fund or the sponsor as a money service business under the regulations promulgated by FinCen, an Authorized Purchaser, the Fund, or the Sponsor may be required to register and comply with such regulations, which could result in extraordinary, recurring and/or non-recurring expenses. PROSPECTUS 7RCC SPOT BITCOIN AND CARBON CREDIT FUTURES ETF Until [__________, ____] (25 calendar days after the date of this prospectus), all dealers effecting transactions in the Shares, whether or not participating in this distribution, may be required to deliver a prospectus. This requirement is in addition to the obligations of dealers to deliver a prospectus when acting as underwriters and with respect to unsold allotments or subscriptions. [________, _____] There are certain risks and tax considerations due to the Fund s cash transactions for the creation and redemption processes. Unanticipated difficulties with respect to the issuance or redemption of Baskets, including but not limited to the withdrawal of Authorized Purchasers, may impact the arbitrage mechanism intended to keep the trading price of Shares closely linked to its NAV and liquidity of the Shares may be adversely impacted. Potential conflicts of interest may arise among the Sponsor or its affiliates and the Fund. The Trust Agreement modifies and restricts the default fiduciary duties under the DSTA, which could permit them to favor their own interests to the detriment of the Fund and its Shareholders under Delaware law. That notwithstanding, the Sponsor is a registered investment adviser under the Investment Advisers Act of 1940, as amended (the "Advisers Act") and is subject to fiduciary duties in connection therewith. Custody of the Fund s Assets The Fund s assets will be split among two custodians. The Trust, on behalf of the Fund, intends to appoint Gemini Trust Company, LLC ("Gemini" and the "Bitcoin Custodian") for the Fund s bitcoin holdings. Separately, U.S. Bank, N.A. (the "Non-Digital Custodian" and collectively with the Bitcoin Custodian, the "Custodians") will serve as the Fund s custodian with respect to its cash and cash equivalents investments, as well as any investments in connection with its investments in Carbon Credit Futures. The Trust, on behalf of the Fund, has entered into a custodial services agreement with Gemini (the "Bitcoin Custody Agreement"), pursuant to which the Bitcoin Custodian will custody all of the Fund s bitcoin. Pursuant to the Bitcoin Custody Agreement, the Bitcoin Custodian establishes accounts that hold the bitcoins deposited with the Bitcoin Custodian on behalf of the Fund. The Fund has also entered into a custodial agreement with the Non-Digital Custodian (the "Non-Digital Custody Agreement") pursuant to which the Non-Digital Custodian will custody the Fund s investments in cash and cash equivalents in connection with the investments in the Carbon Credit Futures. With respect to the settlement of Shares in response to the placement of creation orders and redemption orders from Authorized Purchasers, the Sponsor will retain discretion with respect to which of the Custodians and accompanying assets is selected to facilitate the respective order. Custody of Bitcoin The Fund is responsible for acquiring bitcoin from a Bitcoin Trading Counterparty. Once the bitcoin has been transferred to the applicable Bitcoin Custodian, it will be stored pursuant to the terms of the applicable Bitcoin Custody Agreement. Bitcoin private keys are stored in two different forms: "hot" storage, whereby the private keys are stored on secure, internet-connected devices (a "hot wallet"), and "cold" storage, where digital currency private keys are stored completely offline. The Bitcoin Custody Agreement requires the Bitcoin Custodian to hold the Fund s bitcoin in cold storage, unless required to facilitate withdrawals as a temporary measure. The Bitcoin Custodian will use segregated cold storage bitcoin addresses for the Fund which are separate from the bitcoin addresses that the Bitcoin Custodian uses for its other customers and which are directly verifiable via the Bitcoin Blockchain. The Bitcoin Custodian will at all times record and identify in its books and records that such bitcoins constitute the property of the Fund. The Bitcoin Custodian will not withdraw the Fund s bitcoin from the Fund s account with the Bitcoin Custodian, or loan, hypothecate, pledge or otherwise encumber the Fund s bitcoin, without the Fund s instruction. The Sponsor has evaluated the Bitcoin Custodian s policies, procedures, and controls for safekeeping, exclusively possessing, and controlling the Fund s bitcoin holdings and believes these are designed consistent with accepted industry practices to protect against theft, loss, and unauthorized and accidental use of the private keys. Notwithstanding the Sponsor s evaluation, the Sponsor does not control the Bitcoin Custodian s operations or implementation of such policies, procedures and controls and there can be no assurance that they will actually work as designed or prove to be successful in safeguarding the Fund s assets against all possible sources of theft, loss or damage. While the Bitcoin Custodian carries insurance, its insurance does not cover any loss in value of bitcoin and only covers losses caused by certain events such as fraud or theft and, in such covered events, it is unlikely the insurance would cover the full amount of any losses incurred by the Fund. The insurance maintained by the Bitcoin Custodian is shared among all of the Bitcoin Custodian s customers, is not specific to the Fund or to any customers holding bitcoin with the Bitcoin Custodian, and may not be available or sufficient to protect the Fund from all possible losses or sources of losses. Custody Relating to the Carbon Credit Futures The Fund will maintain an investment in Carbon Credit Futures, the notional amount of which will match the exposure of the Index. At any given time, however, most of the Fund s investments are in cash and cash equivalents that support the Fund s positions in the Carbon Credit Futures. Instead of depositing the entirety of the notional amount of the Carbon Credit Futures contracts with the FCM, the Fund posts a margin deposit, approximately 10% to 20% of the notional amount, with the FCM. To secure its Carbon Credit Futures obligations, the Fund deposits the required margin with the FCM and separately holds its remaining assets through the Non-Digital Custodian, specifically in cash or cash equivalents. Cash equivalents shall mean such investments that, in the view of the Sponsor, are of high credit quality and liquidity and can be converted to cash quickly. Such investments shall include: (a) cash; (b) debt securities issued or directly or indirectly fully guaranteed or insured by the United States or any agency or instrumentality thereof (such as U.S. Treasury Bills); (c) commercial paper or finance company paper of sufficient credit quality in the view of the Sponsor; or (d) money market mutual funds. Additionally, the Fund will use spot market or foreign exchange forwards and customary foreign exchange hedging instruments to seek to remove its foreign currency exposure. Such remaining assets may be used to meet future margin payments the Fund may be required to make on its Carbon Credit Futures. The Fund earns interest and other income from the cash equivalents that it purchases, and on the cash, it holds through the Custodian or other financial institutions. The earned interest and other income increase the Fund s NAV. The Fund applies the earned interest and other income to the acquisition of additional investments or uses it to pay its expenses. When the Fund reinvests the earned interest and other income, it makes investments that are consistent with its investment objectives. Trust Structure The Trust is a Delaware statutory trust, organized on February 10, 2023, that operates pursuant to the First Amended and Restated Declaration of Trust and Trust Agreement between the Sponsor and the Trustee (the "Trust Agreement"). The Trust is governed by the provisions of the Trust Agreement. The Fund is a series of the Trust. Each Share of the Fund represents a fractional undivided beneficial interest in the net assets of the Fund. The Trust s Sponsor is Tidal Investments LLC, a Delaware limited liability company. The Shares are not obligations of, and are not guaranteed by, the Sponsor or any of its subsidiaries or affiliates. Under the Delaware Limited Liability Company Act and the governing documents of the Trust, the Sponsor is not responsible for the debts, obligations and liabilities of the Trust solely by reason of being the Sponsor; provided that the Sponsor has assumed responsibility for the payment of certain Fund expenses. The Sponsor arranged for the creation of the Trust and the establishment of its series, the Fund, and is arranging for the registration of the Shares for their public offering in the United States ("U.S.") and their listing on the Exchange. The Sponsor is obligated to assume and pay the following fees and expenses of the Trust: the Trustee s fee payable under the Trust Agreement, the Custodians Fees (as defined herein), the Transfer Agent Fee (as defined herein), the Marketing Fee (as defined herein), applicable license fees, including the licensing fees related to the Index License Agreement (as defined herein), the Administrator Fee (as defined herein), fees and expenses related to trading of Shares on the Exchange (including marketing, legal and audit fees and expenses), legal expenses, audit fees, regulatory fees, including any fees relating to the registration of the Shares with the SEC, printing and mailing costs and costs of maintaining the Trust s website. The Sponsor also paid the costs of the Trust s organization. As interests in a Delaware statutory trust, the Shares do not possess the rights normally associated with the ownership of shares of a corporation (including, for example, the right to bring shareholder oppression and derivative actions). In addition, the Shares have limited voting and distribution rights (for example, shareholders do not have the right to elect directors, as the Trust does not have a board of directors, and generally will not receive regular distributions of the net income and capital gains earned by the Fund). Shareholders have no voting rights except as expressly provided in the Trust Agreement. The general role, responsibilities and regulation of the Sponsor, Trustee, Administrator, and Custodians are further described on pages [ ], [ ], [ ], [ ] and [ ], respectively. Detailed descriptions of certain specific rights and duties of the Sponsor, Trustee, Administrator, and Custodians begin on page [ ]. Emerging Growth Company and Smaller Reporting Company Status The Fund is an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"). For as long as the Fund is an emerging growth company, it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not "emerging growth companies," including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes–Oxley Act of 2002 (the "Sarbanes-Oxley Act"), reduced disclosure obligations regarding executive compensation in the Trust s periodic reports and audited financial statements in this prospectus, exemptions from the requirements of holding advisory "say-on-pay" votes on executive compensation and shareholder advisory votes on "golden parachute" compensation and exemption from any rules requiring mandatory audit firm rotation and auditor discussion and analysis and, unless otherwise determined by the SEC, any new audit rules adopted by the Public Company Accounting Oversight Board (the "PCAOB"). Under the JOBS Act, the Fund will remain an emerging growth company until the earliest of: (i) the last day of the fiscal year during which the Fund has total annual gross revenues of $1.235 billion or more; (ii) the last day of the fiscal year following the fifth anniversary of the completion of this offering; (iii) the date on which the Fund has, during the previous three-year period, issued more than $1 billion in non-convertible debt; or (iv) the date on which the Fund is deemed to be a "large accelerated filer" (i.e., an issuer that (1) has more than $700 million in outstanding equity held by non-affiliates and (2) has been subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act") for at least 12 calendar months and has filed at least one annual report on Form 10-K.) In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies; however, the Fund is choosing to "opt out" of such extended transition period, and as a result, the Fund will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for companies that are not "emerging growth companies." Section 107 of the JOBS Act provides that the Fund s decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable. We are also a "smaller reporting company" as defined in the Exchange Act. We may continue to be a smaller reporting company even after we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as the market value of our voting and non-voting common stock held by non-affiliates is less than $250 million measured on the last business day of our second fiscal quarter, or our annual revenue is less than $100 million during the most recently completed fiscal year and the market value of our voting and non-voting common stock held by non-affiliates is less than $700 million measured on the last business day of our second fiscal quarter. U.S. Federal Income Tax Considerations The Fund, as a series of the Trust, will be classified as a corporation for U.S. federal income tax purposes. As a result, the Fund will be obligated to pay applicable U.S. federal and state corporate income taxes on its taxable income. See discussion under "Material U.S. Federal Income Tax Consequences" below. Breakeven Amounts The Fund will be profitable only if returns from the Fund s investments exceed its "breakeven amount." The breakeven analysis is an approximation only and assumes a constant month-end. The return that the Fund would need to achieve during one-year to offset the Fund s estimated fees, costs and expenses, net of any interest income earned by the Fund on its investments is 0.16% or $0.04. For purposes of this breakeven analysis, an initial selling price of $25.00 per Share, is assumed. Estimated amounts do not represent actual results, which may be different. It is not possible to predict whether the Fund will break even at the end of the first twelve months of an investment or during any other period. See "Charges—Breakeven Analysis" for more detailed information. Defined Terms For a glossary of defined terms, see the "Glossary of Defined Terms" herein. Principal Offices The Fund is a series of the Trust. The principal office and telephone number of the Trust and the Sponsor is located at 234 West Florida Street, Suite 203, Milwaukee, Wisconsin 53204, and is (844)-986-7700. THE OFFERING Shares offered by the Fund: Shares representing units of fractional undivided beneficial interest in, and ownership of, the Fund. Use of Proceeds: The proceeds of offering the Shares received by the Fund consist of cash, which will be invested in accordance with the Fund s investment objective and strategies described herein. Exchange Symbol: BTCK CUSIP: 88634V209 Net Asset Value As described in more detail below in "Calculation of NAV", "NAV" means the total assets of the Fund, less any liabilities of the Fund. Included in the assets of the Fund are its investments in bitcoin and the value of the Fund s futures contracts. The Fund s NAV on a per Share basis is determined as of the earlier of the close of the Exchange or 4:00 p.m. (ET) on each day that the Exchange is open for trading. The Fund values bitcoin using the same methodology as the Bitcoin Price. Digital asset trading platforms meeting the criteria set out by Kaiko are used as the basis for which Kaiko determines the value of bitcoin. Kaiko reviews the time-weighted average price on all eligible digital asset trading platforms between 3:00 pm ET and 4:00 pm ET and values bitcoin as the median price amongst the eligible platforms. The Sponsor believes this methodology provides a reasonable valuation of the spot price of bitcoin that is reasonably resistant to price manipulation of bitcoin. In order to provide updated information relating to the Fund for use by Shareholders and market professionals, an updated intraday indicative value ("IIV") will be calculated and disseminated each trading day. The IIV will be calculated by using the prior day s closing NAV per Share of the Fund as a base and updating that value throughout the trading day to reflect changes in the value of the Fund s assets. ICE Data Services calculates and disseminates the IIV approximately every 15 seconds. IIV should not be viewed as an actual real time update of the NAV of the Fund. Creation and Redemption: The Fund issues Shares on an ongoing basis, but only in one or more whole Baskets. The Fund also intends to redeem Shares in Baskets on an ongoing basis from Authorized Purchasers (defined below). While investors will purchase and sell Shares through their broker-dealer, the Fund continuously offers creation baskets consisting of 10,000 Shares ("Creation Baskets") at their NAV to certain parties who have entered into an agreement with the Sponsor and the Administrator ("Authorized Purchasers"). The Fund issues and redeems Baskets each day that the Exchange is open for regular trading. The creation and redemption of Baskets requires the delivery of the cash equivalent of the NAV of the aggregate Shares comprising the Basket. Authorized Purchasers, in turn, may sell such Shares received from a Creation Basket on the exchange at the trading price of the Shares on the Exchange. Shares may trade in the secondary market at prices that are lower (a discount) or higher (a premium) than the NAV per Share. See "Description of Creation and Redemption of Shares" for additional information regarding the Fund s procedures regarding the issuance and redemption of Baskets. Fund expenses: The Fund s primary ordinary recurring expense is expected to be the remuneration due to the Sponsor (the "Management Fee"). The Management Fee will be in an amount equal to 0.68% per annum of the daily NAV of the Trust. The Management Fee accrues daily and payments of the Management Fee will occur monthly in arrears. The Management Fee is paid by the Fund to the Sponsor as compensation for services performed under the Trust Agreement, including the management of the Fund s business and affairs. The Sponsor has agreed to pay certain operating expenses of the Fund (except for litigation expenses and other extraordinary expenses) out of the Management Fee. The Fund pays all other transaction related fees and expenses charged in connection with trading activities for the Fund s investments and for maintenance of its CFTC regulatory status as a commodity pool. The Fund bears other transaction costs related to the FCM capital requirements on a monthly basis. The Fund may also incur certain extraordinary, non-recurring expenses and indemnification expenses that are not contractually assumed by the Sponsor. See "Expenses" for additional information. The Sponsor from time to time may sell bitcoin, which may be facilitated by the Bitcoin Custodian, in such quantity as is necessary to permit payment of the Management Fee and may also sell bitcoin, in such quantities as may be necessary to permit the payment of Fund expenses and liabilities not assumed by the Sponsor. To the extent the Sponsor sells bitcoin to permit payment of the Management Fee or other Fund expenses and liabilities not assumed by the Sponsor, the amount of bitcoin held by the Fund will decline over time. Incidental Rights/IR Virtual Currency From time to time, the Fund may be entitled to or come into possession of rights to acquire, or otherwise establish dominion and control over, any virtual currency (for avoidance of doubt, other than bitcoin) or other asset or right, which rights are incident to the Fund s ownership of bitcoins and arise without any action of the Fund, or of the Sponsor or Delaware Trustee on behalf of the Fund ("Incidental Rights") and/or virtual currency tokens, or other assets or rights, acquired by the Trust through the exercise (subject to the applicable provisions of the Trust Agreement) of any Incidental Right ("IR Virtual Currency") by virtue of its ownership of bitcoins, generally through a fork in the Bitcoin blockchain, an airdrop offered to holders of bitcoins or other similar event. With respect to a fork, airdrop or similar event, the Sponsor will cause the Fund to permanently and irrevocably abandon the Incidental Rights and IR Virtual Currency. In the event the Trust seeks to change this position, an application would need to be filed with the SEC by the Exchange seeking approval to amend its listing rules to permit the Fund to sell Incidental Rights or IR Virtual Currency and distribute the cash proceeds (net of expenses and applicable withholding taxes) to Depository Trust Company ("DTC") or distribute the Incidental Rights or IR Virtual Currency in-kind to the DTC. Because the Fund will abandon any Incidental Rights and IR Virtual Currency, the Fund would not receive any direct or indirect consideration for the Incidental Rights or IR Virtual Currency, and thus the value of the Shares will not reflect the value of the Incidental Rights or IR Virtual Currency. See "Risk Factors—Risks Related to Bitcoin, the Bitcoin Network, and Bitcoin Trading Markets— A temporary or permanent "fork" could adversely affect an investment in the Fund. Additionally, the Fund may not receive the benefit of any forks or "airdrops". " Inter-Series Limitation on Liability While the Fund is a separate series of the Trust, additional series may be created in the future. The Trust has been formed and will be operated with the goal that the Fund and any other series of the Trust will be liable only for obligations of such series, and a series will not be responsible for or affected by any liabilities or losses of or claims against any other series. If any creditor or shareholder in any particular series (such as the Fund) were to successfully assert against a series a claim with respect to its indebtedness or shares, the creditor or shareholder could recover only from that particular series and its assets. Accordingly, the debts and other obligations incurred, contracted for or otherwise existing solely with respect to a particular series would be enforceable only against the assets of that series, and not against any other series or the Trust generally or any of their respective assets. The assets of the Fund and any other series will include only those funds and other assets that are paid to, held by or distributed to the series on account of and for the benefit of that series, including, without limitation, amounts delivered to the Trust for the purchase of shares in a series. Termination events: The Trust and the Fund shall continue in existence from the date of their formation in perpetuity, unless the Trust or the Fund, as the case may be, is sooner terminated upon the occurrence of certain events specified in the Trust Agreement, including the following: (1) the filing of a certificate of dissolution or cancellation of the Sponsor or revocation of the Sponsor s charter or the withdrawal of the Sponsor, unless Shareholders holding a majority of the outstanding Shares of the Trust, voting together as a single class, elect within ninety (90) days after such event to continue the business of the Trust and appoint a successor Sponsor; (2) the occurrence of any event which would make the existence of the Trust or the Fund unlawful; (3) the suspension, revocation, or termination of the Sponsor s registration as a CPO with the CFTC or membership with the NFA; (4) the insolvency or bankruptcy of the Trust or the Fund; (5) a vote by the Shareholders holding at least seventy-five percent (75%) of the outstanding Shares of the Trust, voting together as a single class, to dissolve the Trust subject to certain conditions; (6) the determination by the Sponsor to dissolve the Trust or the Fund, subject to certain conditions; (7) the Trust is required to be registered as an investment company under the Investment Company Act; and (8) the DTC is unable or unwilling to continue to perform its functions and a comparable replacement is unavailable. Upon termination of the Fund, the affairs of the Fund shall be wound up and all of its debts and liabilities discharged or otherwise provided for in the order of priority as provided by law. The fair market value of the remaining assets of the Fund shall then be determined by the Sponsor in accordance with its policies for valuing assets, as detailed herein. Thereupon, the assets of the Fund shall be distributed pro rata to the Shareholders in accordance with their Shares. See "Additional Information About the Trust—Description of the Trust Agreement—Termination of the Trust" and "Calculation of NAV–Valuation of the Fund s Assets" for additional information. Authorized Purchasers: Baskets may be created or redeemed only by Authorized Purchasers. Each Authorized Purchaser must: (i) be a registered broker-dealer; and (ii) have entered into an Authorized Purchaser Agreement with the Sponsor and the Administrator. The Authorized Purchaser Agreement provides the procedures for the issuance and redemption of Baskets. See "Description of Creation and Redemption of Shares" for additional information. The Trust has engaged Jane Street Capital, LLC, Citadel Securities LLC and Goldman Sachs & Co. LLC, as Authorized Purchasers. Additional Authorized Purchasers may be added at any time, subject to the discretion of the Sponsor. Clearance and settlement: Individual certificates are not issued for the Shares. Rather, Shares are represented by one or more global certificates, which are deposited by the Transfer Agent with the DTC and registered in the name of Cede & Co., as nominee for DTC. The global certificates evidence all of the Shares outstanding at any time. Beneficial interests in Shares are held through DTC s book-entry system. Accordingly, Shareholders are limited to: (1) purchasers in DTC such as banks, brokers, dealers and trust companies, (2) those who maintain, either directly or indirectly, a custodial relationship with a DTC purchaser, and (3) those who hold interests in the Shares through DTC purchasers or indirect purchasers, in each case who satisfy the requirements for transfers of Shares. DTC purchasers acting on behalf of investors holding Shares through such DTC purchasers accounts in DTC will follow the delivery practice applicable to securities eligible for DTC s Same-Day Funds Settlement System. Shares are credited to DTC purchasers securities accounts following confirmation of receipt of payment. Banks may not provide banking services, or may cut off banking services, to businesses that provide digital asset-related services or that accept digital assets as payment, which could dampen liquidity in the market and damage the public perception of digital assets generally or any one digital asset in particular, such as bitcoin, and its utility as a payment system, which could decrease the price of digital assets generally or individually. Further, the lack of availability of banking services could prevent the Fund from being able to complete the timely liquidation of bitcoin and withdrawal of bitcoin from the Bitcoin Custodian even if the Sponsor determined that such liquidation were appropriate or suitable. Certain privacy-preserving features have been or are expected to be introduced to digital asset networks, such as the Bitcoin Network, and exchanges or businesses that facilitate transactions in bitcoin may be at an increased risk of having banking services cut off if there is a concern that these features interfere with the performance of anti-money laundering duties and economic sanctions checks. Users, developers and miners may otherwise switch to or adopt certain digital assets at the expense of their engagement with other digital asset networks, which may negatively impact those networks, including the Bitcoin Network. The value of the Shares is subject to a number of factors relating to the fundamental investment characteristics of bitcoin as a digital asset, including the fact that digital assets are bearer instruments and loss, theft, or compromise of the associated private keys could result in permanent loss of the asset, and the capabilities and development of blockchain technologies such as the Bitcoin Blockchain. Digital assets such as bitcoin were only introduced within the past 15 years, and the value of the Shares is subject to a number of factors over time relating to the capabilities and development of blockchain technologies, such as the recentness of their development, their dependence on the internet and other technologies, their dependence on the roleplayed by users, developers and miners and the potential for malicious activity. Digital asset networks, including the Bitcoin Network and associated Bitcoin Blockchain and the software used to operate them are in the early stages of development. Given the recentness of the development of digital asset networks, digital assets may not function as intended and parties may be unwilling to use digital assets, which would dampen the growth, if any, of digital asset networks. Because bitcoin is a digital asset, the value of the Shares is subject to a number of factors relating to the fundamental investment characteristics of digital assets, including the fact that digital assets are bearer instruments and loss, theft, compromise, or destruction of the associated private keys could result in permanent loss of the asset. For example, the realization of one or more of the following risks could materially adversely affect the value of the Shares: Digital assets, including bitcoin, are controllable only by the possessor of both the unique public key and private key or keys relating to the Bitcoin Network address, or "wallet," at which the digital asset is held. Private keys must be safeguarded and kept private in order to prevent a third party from accessing the digital asset held in such wallet. The loss, theft, compromise or destruction of a private key required to access a digital asset may be irreversible. If a private key is lost, stolen, destroyed or otherwise compromised and no backup of the private key is accessible, the owner would be unable to access the digital asset corresponding to that private key and the private key will not be capable of being restored by the digital asset network resulting in the total loss of the value of the digital asset linked to the private key. Digital asset networks are dependent upon the internet. A disruption of the internet or a digital asset network, such as the Bitcoin Network, would affect the ability to transfer digital assets, including bitcoin, and, consequently, would impact their value. The acceptance of software patches or upgrades by a significant, but not overwhelming, percentage of the users and miners in a digital asset network, such as the Bitcoin Network, could result in a "fork" in such network s blockchain, including the Bitcoin Blockchain, resulting in the operation of multiple separate networks. Governance of the Bitcoin Network is by voluntary consensus and open competition. As a result, there may be a lack of consensus or clarity on the governance of the Bitcoin Network, which may stymie the Bitcoin Network s utility and ability to grow and face challenges. In particular, it may be difficult to find solutions or martial sufficient effort to overcome any future problems on the Bitcoin Network, especially long-term problems. Over the past decade, bitcoin mining operations have evolved from individual users mining with computer processors, graphics processing units and first-generation application specific integrated circuit machines to "professionalized" mining operations using proprietary hardware or sophisticated machines. If the profit margins of bitcoin mining operations are not sufficiently high, including due to an increase in electricity costs or a decline in the market price of bitcoin, or if bitcoin mining operations are unable to arrange alternative sources of financing (e.g., if lenders refuse to make loans to such miners), bitcoin miners are more likely to immediately sell more bitcoin than they otherwise would, resulting in an increase in liquid supply of bitcoin, which would generally tend to reduce bitcoin s market price. To the extent that any miners cease to record transactions that do not include the payment of a transaction fee in solved blocks or do not record a transaction because the transaction fee is too low, such transactions will not be recorded on the Bitcoin Blockchain until a block is mined by a miner who does not require the payment of transaction fees or is willing to accept a lower fee. Any widespread delays in the recording of transactions could result in a loss of confidence in a digital asset network. Digital asset mining operations can consume significant amounts of electricity, which may have a negative environmental impact and give rise to public opinion against allowing, or government regulations restricting, the use of electricity for mining operations. Additionally, miners may be forced to cease operations during an electricity shortage or power outage, or if electricity prices increase where the mining activities are performed. Many digital asset networks, including the Bitcoin Network, face significant scaling challenges and may periodically be upgraded with various features designed to increase the speed and throughput of digital asset transactions. These attempts to increase the volume of transactions may not be effective, and such upgrades may fail, resulting in potentially irreparable damage to the Bitcoin Network and to the value of bitcoin. The open-source structure of many digital asset network protocols, such as the protocol for the Bitcoin Network, means that developers and other contributors are generally not directly compensated for their contributions in maintaining and developing such protocols. As a result, the developers and other contributors of a particular digital asset may lack a financial incentive to maintain or develop the network, or may lack the resources to adequately address emerging issues. Alternatively, some developers may be funded by companies whose interests are at odds with other participants in a particular digital asset network. A failure to properly monitor and upgrade the protocol of the Bitcoin Network could damage that network. Previously, flaws in the source code for digital assets have been exposed and exploited, including flaws that disabled some functionality for users, exposed users personal information and/or resulted in the theft of users digital assets. The cryptography underlying bitcoin could prove to be flawed or ineffective, or developments in mathematics and/or technology, including advances in digital computing, algebraic geometry and quantum computing, could result in such cryptography becoming ineffective. In any of these circumstances, a malicious actor may be able to compromise the security of the Bitcoin Network or take the Fund s bitcoin, which would adversely affect the value of the Shares. Moreover, functionality of the Bitcoin Network may be negatively affected such that it is no longer attractive to users, thereby dampening demand for bitcoin. Even if another digital asset other than bitcoin were affected by similar circumstances, any reduction in confidence in the source code or cryptography underlying digital assets generally could negatively affect the demand for digital assets and therefore adversely affect the value of the Shares. Moreover, because digital assets, including bitcoin, have been in existence for a short period of time and are continuing to develop, there may be additional risks in the future that are impossible to predict as of the date of this prospectus. The open-source structure of the Bitcoin Network protocol means that the core developers and other contributors are generally not directly compensated for their contributions in maintaining and developing the Bitcoin Network protocol. A failure to properly monitor and upgrade the Bitcoin Network protocol could damage the Bitcoin Network and adversely impact the Fund. The Bitcoin Network operates based on an open-source protocol maintained by the core developers and other contributors, largely on the GitHub resource section dedicated to bitcoin development. As bitcoin is rewarded solely for mining activity and are not sold to raise capital for the Bitcoin Network, and the Bitcoin Network protocol itself is made available for free rather than sold or made available subject to licensing or subscription fees and its use does not generate revenues for its development team, the core developers are generally not compensated for maintaining and updating the source code for the Bitcoin Network protocol. Consequently, there is a lack of financial incentive for developers to maintain or develop the Bitcoin Network and the core developers may lack the resources to adequately address emerging issues with the Bitcoin Network protocol. Although the Bitcoin Network is currently supported by the core developers, there can be no guarantee that such support will continue or be sufficient in the future. In addition, a bad actor could also attempt to interfere with the operation of the Bitcoin Network by attempting to exercise a malign influence over a core developer. To the extent that material issues arise with the Bitcoin Network protocol and the core developers and open-source contributors are unable to address the issues adequately or in a timely manner, investments in bitcoin, such as the Fund s, may be adversely affected. Digital asset networks face significant scaling challenges and efforts to increase the volume and speed of transactions may not be successful. Many digital asset networks, including the Bitcoin Network, face significant scaling challenges due to the fact that public blockchains generally face a tradeoff between security and scalability. One means through which public blockchains achieve security is decentralization, meaning that no intermediary is responsible for securing and maintaining these systems. For example, a greater degree of decentralization generally means a given digital asset network is less susceptible to manipulation or capture. A digital asset network may be limited in the number of transactions it can process by the capabilities of each single fully participating node. As corresponding increases in throughput lag behind growth in the use of digital asset networks, average fees and settlement times may increase considerably. For example, the Bitcoin Network has been, at times, at capacity, which has led to increased transaction fees. Increased fees and decreased settlement speeds could preclude certain uses for bitcoin (e.g., micropayments), and could reduce demand for, and the price of, bitcoin, which could adversely impact the value of the Shares. Since January 1, 2019, bitcoin transaction fees have increased from $0.18 per bitcoin transaction, on average, to a high of $60.95 per transaction, on average, on April 20, 2021. In May 2023, events related to the adoption of ordinals, which are a means of inscribing digital content on the Bitcoin Blockchain, caused transaction fees to temporarily spike above $30 per transaction. As of December 31, 2023, bitcoin transaction fees were $4.45 per transaction, on average, over a one-year trailing basis. Average fees and settlement times may also increase when the number of bitcoin awarded for solving a new block is automatically halved every 210,000 blocks. The current fixed reward for solving a new block is 6.25 bitcoin per block; the reward decreased from twenty-five (25) bitcoin in July 2016 and 12.5 in May 2020. The most recent halving occurred in April 2024 and the next estimated halving is expected to occur in 2028. There is no guarantee that any of the mechanisms in place or being explored for increasing the scale of settlement of the Bitcoin Network transactions will be effective, or how long these mechanisms will take to become effective, which could cause the Bitcoin Network to not adequately resolve scaling challenges and adversely impact the adoption of bitcoin as a medium of exchange. Such impact may adversely impact the value of bitcoin and the value of Shares. The scheduled creation of newly mined bitcoin and their subsequent sale may cause the price of bitcoin to decline, which could negatively affect the value of the Fund s Shares. Newly created bitcoin ("newly mined bitcoin") are generated through a process referred to as "mining" which involves the collection of a reward of new bitcoin. As of the date of this prospectus, the Bitcoin Network creates 6.25 bitcoin with each block added to the Blockchain; these newly mined bitcoin are awarded to the bitcoin miner that has added the block to the Blockchain, which occurs on average approximately every 10 minutes. When the recipient makes newly mined bitcoin available for sale, there can be downward pressure on the price of bitcoin as the new supply is introduced into the market. Lower bitcoin prices may result in further tightening of profit margins for miners and decreasing profitability, thereby potentially causing further selling pressure. Diminishing profit margins and increasing sales of newly mined bitcoin could result in a reduction in the price of bitcoin, which could adversely impact an investment in the Shares. In addition, bitcoin mining is highly sensitive to energy prices and digital assets market prices. Bitcoin miners use specialized computers that consume significant amounts of energy. As energy prices fluctuate, the marginal cost of bitcoin mining increases and decreases. Conversely, the price of bitcoin and amount of computational power being expended by other bitcoin miners will impact the profitability and likelihood of solving a block and receiving newly mined bitcoin. If the marginal cost of bitcoin mining exceeds the expected profit, miners may cease to expend energy to mine bitcoin. If a material number of miners turn off their mining hardware, the speed of transaction processing on the Bitcoin Network may experience a temporary slowdown and the overall security of the Bitcoin Network may be reduced. Bitcoin mining consumes large amounts of electricity, and many bitcoin miners rely on fossil fuels to power their operations. Public perception of the impact of bitcoin mining on climate change and/or country-specific or global climate change regulations that cap or ban energy usage may reduce demand for bitcoin and increase the likelihood of regulation that limits bitcoin mining or restricts energy usage by bitcoin miners. Such events could have an impact on the price of bitcoin and the performance of the Fund. The prevailing level of transaction fees may adversely affect the usage of the Bitcoin Network. In addition to the reward of new bitcoin, Bitcoin miners collect fees for each transaction they confirm. Miners validate unconfirmed transactions by adding the previously unconfirmed transactions to new blocks in the Blockchain. Miners are not forced to confirm any specific transaction, but they are economically incentivized to confirm valid transactions as a means of collecting fees. Miners have historically accepted relatively low transaction confirmation fees, because miners have a very low marginal cost of validating unconfirmed transactions. In addition, most iterations of mining software will prioritize transactions recorded based on (i) thresholds selected by the user, (ii) the transaction fee paid with the transaction, (iii) the value attached to the transaction and (iv) the time the transaction was received by the mining software. If miners collude in an anticompetitive manner to not record transactions that pay low transaction fees, then bitcoin users would be required to either wait for their transaction to be included in a block by a miner not requiring such transaction fees or require users pay higher fees to ensure their transactions are recorded promptly, thus reducing the attractiveness of the Bitcoin Network. Bitcoin mining occurs globally, and it may be difficult for authorities to apply antitrust regulations across multiple jurisdictions. Any collusion among miners may adversely impact the value of bitcoin and the value of Shares, as well as the ability of the Fund to operate. If the number of outstanding transactions yet to be recorded in the Blockchain (commonly referred to as "transactions in the mempool") are significantly above the capacity which can be recorded in any single block, miners are likely to prioritize recording transactions that pay significant transaction fees. This would result in transactions with low or no fees remaining in the mempool for extended periods. Such a scenario would further incentivize higher fees paid to ensure their transactions are recorded promptly, thus reducing the attractiveness of the Bitcoin Network. An extended period of large numbers of transactions in the mempool could result from high levels of use of the Bitcoin Network or from a malicious spam attack intending to increase the transactions in the mempool. Any extended period with large numbers of transactions in the mempool may adversely impact the value of the Shares or the ability of the Fund to operate. Additionally, the reward for successful mining transactions (also known as the "block reward") will decrease over time. In May 2020, the block reward was reduced from 12.5 to 6.25 bitcoin, and will further be reduced by half approximately every four years (e.g., to 3.125 bitcoin in 2024). As the block reward continues to decrease over time, the mining incentive structure may transition to a higher reliance on transaction confirmation fees in order to incentivize miners to continue to dedicate processing power to the blockchain. If transaction confirmation fees become too high, the marketplace may be reluctant to use bitcoin. Conversely, if the combination of the block reward and transaction fees are too low, miners may not be incentivized to expend processing power to solve blocks and confirmations of transactions on the Blockchain could be temporarily slowed. A reduction in the processing power expended by miners on the Bitcoin Network could increase the likelihood of a malicious actor or botnet obtaining control. Any reduction in infrastructure security may reduce confidence in the Bitcoin Network or expose the Bitcoin Network to a malicious actor or botnet obtaining a majority of processing power on the Bitcoin Network, reducing the confidence in and security of the Blockchain. Decreased demand for bitcoin or reduced security on the Bitcoin Network may adversely impact the Shares. A temporary or permanent "fork" could adversely affect an investment in the Fund. Additionally, the Fund may not receive the benefit of any forks or "airdrops". The Bitcoin Network operates using open-source protocols, meaning that any user can download the software, modify it and then propose that the users and miners of bitcoin adopt the modification. When a modification is introduced and a substantial majority of users and miners consent to the modification, the change is implemented and the network remains uninterrupted. However, if less than a substantial majority of users and miners consent to the proposed modification, and the modification is not compatible with the software prior to its modification, the consequence would be what is known as a "hard fork" of the Bitcoin Network, with one group running the pre-modified software and the other running the modified software. The effect of such a fork would be the existence of two versions of bitcoin running in parallel on separate networks using separate blockchain ledgers, yet lacking interchangeability. For example, in August 2017, Bitcoin "forked" into Bitcoin and a new digital asset, Bitcoin Cash, as a result of a several-year dispute over how to increase the rate of transactions that the Bitcoin Network can process. Forks may also occur as a network community s response to a significant security breach. For example, in July 2016, Ethereum "forked" into Ethereum and a new digital asset, Ethereum Classic, as a result of the Ethereum network community s response to a significant security breach in which an anonymous hacker exploited a smart contract running on the Ethereum network to syphon approximately $60 million of ETH held by The DAO, a distributed autonomous organization, into a segregated account. In response to the hack, most participants in the Ethereum community elected to adopt a "fork" that effectively reversed the hack. However, a minority of users continued to develop the original blockchain, now referred to as "Ethereum Classic" with the digital asset on that blockchain now referred to as Ethereum Classic, or ETC. ETC now trades on several digital asset exchanges. A fork may also occur as a result of an unintentional or unanticipated software flaw in the various versions of otherwise compatible software that users run. Such a fork could lead to users and miners abandoning the digital asset with the flawed software. It is possible, however, that a substantial number of users and miners could adopt an incompatible version of the digital asset while resisting community-led efforts to merge the two chains. This could result in a permanent fork, as in the case of Ethereum and Ethereum Classic. In addition, many developers have previously initiated hard forks in the Blockchain to launch new digital assets, such as Bitcoin Gold and Bitcoin Diamond. To the extent such digital assets compete with bitcoin, such competition could impact demand for bitcoin and could adversely impact the value of Shares. Furthermore, a hard fork can lead to new security concerns. For example, when the Ethereum and Ethereum Classic networks, two other digital asset networks, split in July 2016, replay attacks, in which transactions from one network were rebroadcast to nefarious effect on the other network, plagued Ethereum exchanges through at least October 2016. An Ethereum exchange announced in July 2016 that it had lost 40,000 Ethereum Classic, worth about $100,000 at that time, as a result of replay attacks. Similar replay attack concerns occurred in connection with the Bitcoin Cash and Bitcoin SV networks split in November 2018. Another possible result of a hard fork is an inherent decrease in the level of security due to significant amounts of mining power remaining on one network or migrating instead to the new forked network. After a hard fork, it may become easier for an individual miner or mining pool s hashing power to exceed 50% of the processing power of a digital asset network that retained or attracted less mining power, thereby making digital assets that rely on proof-of-work more susceptible to attack. A hard fork may adversely affect the price of bitcoin at the time of announcement or adoption. For example, the announcement of a hard fork could lead to increased demand for the pre-fork digital asset, in anticipation that ownership of the pre-fork digital asset would entitle holders to a new digital asset following the fork. The increased demand for the pre-fork digital asset may cause the price of the digital asset to rise. After the hard fork, it is possible the aggregate price of the two versions of the digital asset running in parallel would be less than the price of the digital asset immediately prior to the fork. Furthermore, while the Sponsor will, as permitted by the terms of the Trust Agreement, determine which network is generally accepted as the Bitcoin Network and should therefore be considered the appropriate network for the Fund s purposes, there is no guarantee that the Sponsor will choose the network and the associated digital asset that is ultimately the most valuable fork. Either of these events could therefore adversely impact the value of Shares. A future fork in the Bitcoin Network could adversely affect the portion of the Shares value that is tied to bitcoin or the ability of the Fund to operate. As another example of the effects of hard forks on digital assets, on September 15, 2022, the Ethereum Network completed its Merge, moving from a proof-of-work model to a proof-of-stake model. Ethereum proof-of-work miners who disagreed with the new consensus mechanism forked the network which resulted in the Ethereum proof-of-work network. Ethereum proof-of-work network was driven by a small but vocal group of miners who wished to hold onto revenue as Ethereum switched to proof-of-stake. The vast majority of token holder votes preferred the new proof-of- stake consensus method. There was no material impact on the Ethereum network as a result of the fork. All ether holders were airdropped Ethereum proof-of-work network tokens as a result of the hard fork. However, not all liquidity providers were able to trade the new token and the Ethereum proof-of-work network token almost immediately lost most of its value. In addition to forks, a digital asset may become subject to a similar occurrence known as an "airdrop." In an airdrop, the promoters of a new digital asset announce to holders of another digital asset that such holders will be entitled to claim a certain amount of the new digital asset for free, based on the fact that they hold such other digital asset. For example, in March 2017 the promoters of Stellar Lumens announced that anyone that owned bitcoin as of June 26, 2017 could claim, until August 27, 2017, a certain amount of Stellar Lumens. Airdrops could create operational security, legal or regulatory, or other risks for the Fund, the Sponsor, the Bitcoin Custodian, Authorized Purchasers or other entities. An "Incidental Right" is the right to receive any benefit of a fork, airdrop or similar event, and any such virtual currency (other than bitcoin) acquired through an Incidental Right is an "IR Virtual Currency." With respect to a fork, airdrop or similar event, the Sponsor will cause the Fund to irrevocably abandon the Incidental Rights and any IR Virtual Currency associated with such event. As such, Shareholders will not receive the benefits of any Incidental Rights and any IR Virtual Currency. In the event the Fund seeks to change its policy with respect to the Incidental Rights or IR Virtual Currency, an application would need to be filed with the SEC by the Exchange seeking approval to amend its listing rules to permit the Fund to sell Incidental Rights or IR Virtual Currency and distribute the cash proceeds (net of expenses and applicable withholding taxes) to DTC or distribute the Incidental Rights or IR Virtual Currency in-kind to DTC. However, there can be no assurance as to whether or when the Sponsor would make such a decision, or when the Exchange would seek or obtain this approval, if at all. Even if such regulatory approval is sought and obtained, Shareholders may not receive the benefits of a fork, the Trust may not choose, or be able, to participate in an airdrop, and the timing of receiving any benefits from a fork, airdrop or similar event is uncertain. Any inability to recognize the economic ability of a hard fork or airdrop could adversely affect the value of the Shares. Investors who prefer to have a greater degree of control over events such as forks, airdrops, and similar events, and any assets made available in connection with each, should consider investing in bitcoin directly rather than purchasing Shares. A hard fork could change the source code to the Bitcoin Network, including the 21 million bitcoin supply cap. In principle a hard fork could change the source code for the Bitcoin Network, including the source code which limits the supply of bitcoin to 21 million. Although many observers believe this is unlikely at present, there is no guarantee that the current 21 million supply cap for outstanding bitcoin, which is estimated to be reached by approximately the year 2140, will not be changed. If a hard fork changing the 21 million supply cap is widely adopted, the limit on the supply of bitcoin could be lifted, which could have an adverse impact on the value of bitcoin and the portion of the Shares value that is tied to bitcoin. In the event of a hard fork of the Bitcoin Network, the Sponsor will, if permitted by the terms of the Trust Agreement, use its discretion to determine which network should be considered the appropriate network for the Fund s purposes, and in doing so may adversely affect the value of Shares. In the event of a hard fork of the Bitcoin Network, the Sponsor will, as permitted by the terms of the Trust Agreement, use its sole discretion to determine, in good faith, which peer-to-peer network, among a group of incompatible forks of the Bitcoin Network, is generally accepted as the Bitcoin Network and should therefore be considered the appropriate network for the Fund s purposes. The Sponsor will base its determination on whatever factors it deems relevant, including but not limited to, the Sponsor s beliefs regarding expectations of the core developers of bitcoin, users, services, businesses, miners and other constituencies, as well as the actual continued acceptance of, mining power on, and community engagement with, the Bitcoin Network, or whatever other factors it deems relevant. There is no guarantee that the Sponsor will choose the digital asset that is ultimately the most valuable fork, and the Sponsor s decision may adversely affect the portion of the Shares value that is tied to bitcoin as a result. The Sponsor may also disagree with Shareholders, the Bitcoin Custodian, other service providers, Kaiko, cryptocurrency exchanges, or other market participants on what is generally accepted as bitcoin and should therefore be considered "bitcoin" for the Fund s purposes, which may also adversely affect the value of Shares. If a malicious actor or botnet obtains control of more than 50% of the processing power on the Bitcoin Network, or otherwise obtains control over the Bitcoin Network through its influence over core developers or otherwise, such actor or botnet could manipulate how data is recorded the Blockchain to adversely affect the value of Shares and/or the ability of the Fund to operate. If a malicious actor or botnet (a volunteer or hacked collection of computers controlled by networked software coordinating the actions of the computers) obtains control of more than 50% of the processing power dedicated to mining on the Bitcoin Network, it may be able to alter the Blockchain on which transactions in bitcoin rely by constructing fraudulent blocks or preventing certain transactions from completing in a timely manner, or at all. The malicious actor or botnet could also control, exclude or modify the ordering of transactions. Although the malicious actor or botnet would not be able to generate new bitcoin or transactions using such control, it could "double-spend" its own tokens (i.e., spend the same tokens in more than one transaction) and prevent the confirmation of other users transactions for so long as it maintained control. To the extent that such a malicious actor or botnet did not yield its control of the processing power on the Bitcoin Network or the bitcoin community did not reject the fraudulent blocks as malicious, reversing any changes made to the Blockchain may not be possible. Further, a malicious actor or botnet could create a flood of transactions in order to slow down the Bitcoin Network or cause an increase in the transaction fees paid by users to confirm transactions. Although there are no known reports of malicious parties taking control of the Bitcoin Network, it is believed that certain mining pools may have exceeded the 50% threshold on the Bitcoin Network on a temporary basis. The possible crossing of the 50% threshold indicates a greater risk that a single mining pool could exert authority over the validation of bitcoin transactions, and this risk is heightened if over 50% of the processing power on the network falls within the jurisdiction of a single governmental authority. For example, it is believed that more than 50% of the processing power on the Bitcoin Network may be located in China. Because the Chinese government has subjected digital assets to heightened levels of scrutiny recently, reportedly forcing several digital asset exchanges to shut down, there is a risk that the Chinese government could also achieve control over more than 50% of the processing power on the Bitcoin Network. If network participants, including the core developers and the administrators of mining pools, do not act to ensure greater decentralization of bitcoin mining processing power, the feasibility of a malicious actor obtaining control of the processing power on the Bitcoin Network will increase, which may adversely affect the value of Shares. Additionally, if miners experience financial or other difficulties on a large scale and are unable to participate in mining activities, the risks of the Bitcoin Network becoming more centralized, and therefore more susceptible to malicious actor control, could increase. A malicious actor may also obtain control over the Bitcoin Network through its influence over core developers by gaining direct control over a core developer or an otherwise influential programmer. To the extent that the bitcoin ecosystem does not grow, the possibility that a malicious actor may be able to obtain control of the processing power or development control on the Bitcoin Network will remain heightened. Additionally, to the extent that users and miners accept amendments to the source code proposed by the controlled core developer, other core developers do not counter such amendments, and such amendments enable the malicious exploitation of the Bitcoin Network, the risk that a malicious actor may be able to obtain control of the Bitcoin Network in this manner exists. The Fund is subject to risks as a result of investing approximately 80% of its assets in a single asset: bitcoin. Any decreases in the value of bitcoin or disruption of the bitcoin trading markets, generally, will adversely impact the value of Shares. The Fund may be more volatile than an investment in a more broadly diversified portfolio. The Fund s investment strategy includes the Fund concentrating 80% of its assets in bitcoin. Accordingly, the Fund s holdings are not diversified. The Fund s value is therefore more susceptible to adverse impacts to bitcoin than other, more diversified funds. Fluctuations in the price of bitcoin are expected to directly impact the value of Shares. The Fund s NAV may be more volatile than an investment vehicle with a more broadly diversified portfolio and may experience significant fluctuations over either a short or long period of time. 80% of the Fund s investments are in bitcoin, and the value of Shares will be significantly impacted by the value of bitcoin. Bitcoin s value may be highly volatile and subject to fluctuations due to a number of factors. 80% of the value of the Fund is invested in bitcoin, and the value of Shares will be significantly impacted by the value of bitcoin. Fluctuations in the value of bitcoin could adversely, and significantly, affect the value of Shares. The market price of bitcoin may be highly volatile, and subject to a number of factors, including: an increase in the global bitcoin supply or a decrease in global bitcoin demand; market conditions of, and overall sentiment towards, the digital assets and blockchain technology industry; trading activity on digital asset exchanges, which, in many cases, are largely unregulated or may be subject to manipulation; the adoption of bitcoin as a medium of exchange, store-of-value or other consumptive asset and the maintenance and development of the open-source software protocol of the Bitcoin Network, and their ability to meet user demands; forks in the Bitcoin Network; investors expectations with respect to interest rates, the rates of inflation of fiat currencies or bitcoin, and digital asset exchange rates; consumer preferences and perceptions of bitcoin specifically and digital assets generally; negative events, publicity, and social media coverage relating to the digital assets and blockchain technology industry; fiat currency withdrawal and deposit policies on digital asset exchanges; the liquidity of digital asset markets and any increase or decrease in trading volume or market making on digital asset markets; business failures, bankruptcies, hacking, fraud, crime, government investigations, or other negative developments affecting digital asset businesses, including digital asset exchanges, or banks or other financial institutions and service providers which provide services to the digital assets industry; the use of leverage in digital asset markets, including the unwinding of positions, "margin calls," collateral liquidations and similar events; investment and trading activities of large or active consumer and institutional users, speculators, miners, and investors in bitcoin; an active derivatives market for bitcoin or for digital assets generally; monetary policies of governments, legislation or regulation, trade restrictions, currency devaluations and revaluations and regulatory measures or enforcement actions, if any, that restrict the use of bitcoin as a form of payment or the purchase of bitcoin on the digital asset markets; global or regional political, economic or financial conditions, events and situations, such as a novel coronavirus outbreak; fees associated with processing a bitcoin transaction and the speed at which bitcoin transactions are settled; the maintenance, troubleshooting, and development of the Bitcoin Network including by miners and developers worldwide; the ability for the Bitcoin Network to attract and retain miners to secure and confirm transactions accurately and efficiently; ongoing technological viability and security of the Bitcoin Network and bitcoin transactions, including vulnerabilities against hacks and scalability; financial strength of market participants; the availability and cost of funding and capital; the liquidity and credit risk of digital asset platforms; interruptions in service from or closures or failures of major digital asset exchanges or their banking partners, or outages or system failures affecting the Bitcoin Network; decreased confidence in digital assets and digital assets exchanges; poor risk management or fraud by entities in the digital assets ecosystem; increased competition from other forms of digital assets or payment services; and the Fund s own acquisitions or dispositions of bitcoin, since there is no limit on the number of bitcoin that the Fund may acquire. There is no assurance that bitcoin will maintain its value in the long, intermediate, short, or any other term. In the event that the price of bitcoin declines, the Shares value will also decline. The value of a bitcoin as represented by the Bitcoin Price may also be subject to momentum pricing due to speculation regarding future appreciation in value, leading to greater volatility that could adversely affect the value of the Shares. Momentum pricing typically is associated with growth stocks and other assets whose valuation, as determined by the investing public, accounts for future appreciation in value, if any. The Sponsor believes that momentum pricing of bitcoin has resulted, and may continue to result, in speculation regarding future appreciation in the value of bitcoin, inflating and making the Index more volatile. As a result, bitcoin may be more likely to fluctuate in value due to changing investor confidence, which could adversely affect the value of Shares. Bitcoin ownership is concentrated in a small number of holders referred to as "Whales." A significant portion of bitcoin is held by a small number of holders who have the ability to affect the price of bitcoin and who are sometimes referred to as "whales." Because bitcoin is lightly regulated, bitcoin whales have the ability, alone or in coordination, to manipulate the price of bitcoin by restricting or expanding the supply of bitcoin. Activities of bitcoin whales that reduce user confidence in bitcoin, the Bitcoin Network or the fairness of bitcoin trading venues, or that affect the price of bitcoin, could have a negative impact on the portion of the Shares value that is tied to bitcoin. Due to the unregulated nature and lack of transparency surrounding the operations of digital asset exchanges, they may experience fraud, security failures or operational problems, which may adversely affect the value of bitcoin and, consequently, the value of Shares. Digital asset exchanges are relatively new and, in some cases, unregulated. Furthermore, while many prominent digital asset exchanges provide the public with significant information regarding their ownership structure, management teams, corporate practices and regulatory compliance, many digital asset exchanges do not provide this information. Digital asset exchanges do not appear to be subject to, or may not comply with, regulation in a similar manner as other regulated trading platforms, such as national securities exchanges or designated contract markets. As a result, the marketplace may lose confidence in digital asset exchanges, including prominent exchanges that handle a significant volume of bitcoin trading. Many digital asset exchanges are unlicensed, unregulated, operate without extensive supervision by governmental authorities, and do not provide the public with significant information regarding their ownership structure, management team, corporate practices, cybersecurity, and regulatory compliance. In particular, those located outside the United States may be subject to significantly less stringent regulatory and compliance requirements in their local jurisdictions. As a result, trading activity on or reported by these digital asset exchanges is generally significantly less regulated than trading in regulated U.S. securities and commodities markets, and may reflect behavior that would be prohibited in regulated U.S. trading venues. For example, in 2019 there were reports claiming that 80.95% of bitcoin trading volume on digital asset exchanges was false or noneconomic in nature, with specific focus on unregulated exchanges located outside of the United States engaging in a variety of manipulative or fraudulent activities. Nonetheless, any actual or perceived false trading in the digital asset exchange market, and any other fraudulent or manipulative acts and practices, could adversely affect the value of bitcoin and/or negatively affect the market perception of bitcoin. The bitcoin market globally and in the United States is not subject to the regulatory guardrails that exist in the regulated securities markets nor the safeguards put in place by exchanges for more traditional assets to enhance the stability of trading on exchanges and prevent "flash crashes." Tools to detect and deter fraudulent or manipulative trading activities such as market manipulation, front-running of trades, and wash-trading, may not be available to or employed by digital asset exchanges, or may not exist at all. The effect of these could inflate volumes in the digital asset markets and/or cause distortions in price, which could adversely affect the Fund. In addition, over the past several years, some digital asset exchanges have been closed due to fraud and manipulative activity, business failure or security breaches. In many of these instances, the customers of such digital asset exchanges were not compensated or made whole for the partial or complete losses of their account balances in such digital asset exchanges. While, generally speaking, smaller digital asset exchanges are less likely to have the infrastructure and capitalization that make larger digital asset exchanges more stable, larger digital asset exchanges are more likely to be appealing targets for hackers and malware and may be more likely to be targets of regulatory enforcement action. For example, in November 2022, FTX Trading Ltd. ("FTX"), one of the largest digital asset exchanges by volume at the time, halted customer withdrawals amid rumors of the company s liquidity issues and likely insolvency, which were subsequently corroborated by its CEO. Shortly thereafter, FTX s CEO resigned and FTX and many of its affiliates filed for bankruptcy in the United States, while other affiliates have entered insolvency, liquidation, or similar proceedings around the globe, following which the U.S. Department of Justice brought criminal fraud and other charges, and the SEC and CFTC brought civil securities and commodities fraud charges, against certain of FTX s and its affiliates senior executives, including its former CEO. Around the same time, there were reports that approximately $300-600 million of digital assets were removed from FTX and the full facts remain unknown, including whether such removal was the result of a hack, theft, insider activity, or other improper behavior. Negative perception, a lack of stability in the digital asset markets and the closure or temporary shutdown of digital asset exchanges due to fraud, failure or security breaches may reduce confidence in the Bitcoin Network and result in greater volatility or decreases in the prices of bitcoin. Furthermore, the closure or temporary shutdown of one of the digital asset exchanges used in calculating the value of bitcoin by the Index may result in a loss of confidence in the Fund s ability to determine its NAV on a daily basis. The potential consequences of a digital asset exchange s failure could adversely affect the value of the Shares. The value of bitcoin may be subject to momentum pricing whereby the current bitcoin price may account for speculation regarding future appreciation in value. Momentum pricing with respect to bitcoin may result in greater volatility and adversely affect the value of Shares. Momentum pricing typically is associated with growth stocks and other assets whose valuation, as determined by the investing public, accounts for anticipated future appreciation in value. The Sponsor believes that momentum pricing of bitcoin has resulted, and may continue to result, in speculation regarding future appreciation in the value of bitcoin, inflating and making more volatile the price of bitcoin. As a result, bitcoin may be more likely to fluctuate in value due to changing investor confidence in future appreciation (or depreciation) in the price of bitcoin, which could adversely affect the portion of the Shares value that is tied to bitcoin. The Shares may trade at a discount or premium in the trading price relative to the Fund s NAV on a per Share basis as a result of non-concurrent trading hours between the Exchange and the Bitcoin Platform Markets. The value of a Share may be influenced by non-concurrent trading hours between the Exchange and various Bitcoin Platforms, including those that represent components of the Index. While the Exchange is open for trading in the Shares for a limited period each day, the Bitcoin Platform Market is a 24-hour marketplace; however, trading volume and liquidity on the Bitcoin Platform Market is not consistent throughout the day and Bitcoin Platforms, including the larger-volume markets, have been known to shut down temporarily or permanently due to security concerns, directed denial of service attacks and distributed denial of service attacks (coordinated hacking attempts to disrupt websites, web servers or computer networks in which an attacker bombards an online target with a large quantity of external requests, thus precluding the target from processing requests from genuine users) and other reasons. As a result, during periods when the Exchange is open but large Bitcoin Platforms (or a substantial number of smaller Bitcoin Platforms) are either lightly traded or are closed, trading spreads and the resulting premium or discount on the Shares may widen and, therefore, increase the difference between the price of the Shares and the Fund s Holdings per Share. Premiums or discounts may have an adverse effect on an investment in the Shares if a Shareholder sells or acquires its Shares during a period of discount or premium, respectively. If bitcoin prices on the Bitcoin Platform Market move negatively during hours when the Exchange is closed, trading prices on the Exchange may "gap" down at market open. The value of a Share may be influenced by non-concurrent trading hours between the Exchange and various Bitcoin Platforms, including those that represent components of the Index. While the Exchange is open for trading in the Shares for a limited period each day, the Bitcoin Platform Market is a 24-hour marketplace. During periods when the Exchange is closed but Bitcoin Platforms are open, significant changes in the price of bitcoin on the Bitcoin Platform Market could result in a difference in performance between the value of bitcoin as measured by the Index and the most recent Holdings per Share or closing trading price. To the extent that the price of bitcoin on the Bitcoin Platform Market, and the value of bitcoin as measured in part by the Index, moves significantly in a negative direction after the close of the Exchange, the trading price of the Shares may "gap" down to the full extent of such negative price shift when the Exchange reopens. To the extent that the price of bitcoin on the Bitcoin Platform Market drops significantly during hours the Exchange is closed, investors may not be able to sell their Shares until after the "gap" down has been fully realized, resulting in an inability to mitigate losses in a rapidly negative market. RISK FACTORS You should consider carefully the risks described below before making an investment decision. You should also refer to the other information included in this prospectus, including the Trust s financial statements and related notes thereto. Risks Related to Bitcoin, the Bitcoin Network, and Bitcoin Trading Markets The trading prices of many digital assets, including bitcoin, have experienced extreme volatility in recent periods and may continue to do so. Extreme volatility in the future, including further declines in the trading prices of bitcoin, could have a material adverse effect on the value of the Shares and the Shares could lose significant value. The trading prices of many digital assets, including bitcoin, have experienced extreme volatility in recent periods and may continue to do so. For instance, there were steep increases in the value of certain digital assets, including bitcoin, over the course of 2021, and multiple market observers asserted that digital assets were experiencing a "bubble." These increases were followed by steep drawdowns throughout 2022 in digital asset trading prices, including for bitcoin. These episodes of rapid price appreciation followed by steep drawdowns have occurred multiple times throughout bitcoin s history, including in 2011, 2013-2014, and 2017-2018, before repeating again in 2021-2022. Over the course of 2023 and 2024, bitcoin prices have continued to exhibit extreme volatility. The price of bitcoin reached new all-time highs in January 2025. Extreme volatility may persist and the portion of the Shares value that is tied to bitcoin may significantly decline in the future without recovery. The digital asset markets may still be experiencing a bubble or may experience a bubble again in the future. For example, in the first half of 2022, each of Celsius Network, Voyager Digital Ltd., and Three Arrows Capital declared bankruptcy, resulting in a loss of confidence in participants of the digital asset ecosystem and negative publicity surrounding digital assets more broadly. In November 2022, FTX Trading Ltd. ("FTX"), one of the largest digital asset exchanges by volume at the time, halted customer withdrawals amid rumors of the company s liquidity issues and likely insolvency, which were subsequently corroborated by its CEO. Shortly thereafter, FTX s CEO resigned and FTX and many of its affiliates filed for bankruptcy in the United States, while other affiliates have entered insolvency, liquidation, or similar proceedings around the globe, following which the U.S. Department of Justice brought criminal fraud and other charges, and the SEC and CFTC brought civil securities and commodities fraud charges, against certain of FTX s and its affiliates senior executives, including its former CEO. In addition, several other entities in the digital asset industry filed for bankruptcy following FTX s bankruptcy filing, such as BlockFi Inc. and Genesis Global Capital, LLC ("Genesis"). In response to these events (collectively, the "2022 Events"), the digital asset markets have experienced extreme price volatility and other entities in the digital asset industry have been, and may continue to be, negatively affected, further undermining confidence in the digital asset markets. These events have also negatively impacted the liquidity of the digital asset markets as certain entities affiliated with FTX engaged in significant trading activity. If the liquidity of the digital asset markets continues to be negatively impacted by these events, digital asset prices, including bitcoin, may continue to experience significant volatility or price declines and confidence in the digital asset markets may be further undermined. In addition, regulatory and enforcement scrutiny has increased, including from, among others, the Department of Justice, the SEC, the CFTC, the White House and Congress, as well as state regulators and authorities. These events are continuing to develop and the full facts are continuing to emerge. It is not possible to predict at this time all of the risks that they may pose to the Fund, its service providers or to the digital asset industry as a whole. Extreme volatility in the future, including further declines in the trading prices of bitcoin, could have a material adverse effect on the value of the Shares and the Shares could lose a material amount of their value. Digital assets represent a new and rapidly evolving industry, and the value of the Shares in part depends on the acceptance of bitcoin. The Bitcoin Network was first launched in 2009 and bitcoin was the first cryptographic digital assets created to gain global adoption and critical mass. Although the Bitcoin Network is the most established digital asset network, the Bitcoin Network and other cryptographic and algorithmic protocols governing the issuance of digital assets represent a new and rapidly evolving industry that is subject to a variety of factors that are difficult to evaluate. For example, the realization of one or more of the following risks could materially adversely affect the price of bitcoin and therefore the value of Shares: Bitcoin has only recently become selectively accepted as a means of payment by retail and commercial outlets, and use of bitcoin by consumers to pay such retail and commercial outlets remains limited. Banks and other established financial institutions may refuse to process funds for bitcoin transactions; process wire transfers to or from digital asset exchanges, bitcoin-related companies or service providers; or maintain accounts for persons or entities transacting in bitcoin. As a result, the prices of bitcoin may be primarily determined by speculators and miners, thus contributing to price volatility that makes retailers less likely to accept it as a form of payment in the future. A possible "short squeeze" due to a sudden increase in demand for the Shares that largely exceeds supply may lead to price volatility in the Shares. Investors may purchase Shares to hedge existing bitcoin or other digital currencies, commodity or currency exposure or to speculate on the price of bitcoin. Speculation on the price of bitcoin may involve long and short exposures. To the extent that aggregate short exposure exceeds the number of Shares available for purchase (for example, in the event that large redemption requests by Authorized Purchasers dramatically affect Share liquidity), investors with short exposure may have to pay a premium to repurchase Shares for delivery to Share lenders. Those repurchases may, in turn, dramatically increase the price of the Shares until additional Shares are created through the creation process. This is often referred to as a "short squeeze." A short squeeze could lead to volatile price movements in the portion of the Shares value that is tied to bitcoin that are not directly correlated to the price of bitcoin. Competition from the emergence or growth of other digital assets or methods of investing in bitcoin could have a negative impact on the price of bitcoin and adversely affect the value of Shares. Bitcoin was the first digital asset to gain global adoption and critical mass, and as a result, it has a "first to market" advantage over other digital assets. As of December 31, 2024, bitcoin was the largest digital asset by market capitalization and had the largest user base and largest combined mining power. Despite this first to market advantage, as of December 31, 2024, there were over 16,800 alternative digital assets tracked by CoinGecko.com, having a total market capitalization of approximately $3.7 trillion (including the approximately $2.06 trillion market capitalization of bitcoin), as calculated using market prices and total available supply of each digital asset. In addition, many consortiums and financial institutions are also researching and investing resources into private or permissioned smart contract platforms rather than open platforms like the Bitcoin Network. Competition from the emergence or growth of alternative digital assets and smart contracts platforms, such as Ethereum, Solana, Avalanche, Polkadot, or Cardano, could have a negative impact on the demand for, and price of, bitcoin and thereby adversely affect the value of the Shares. In addition, some digital asset networks, including the Bitcoin Network, may be the target of ill will from users of other digital asset networks. For example, Litecoin is the result of a hard fork of bitcoin. Some users of the Bitcoin Network may harbor ill will toward the Litecoin network, and vice versa. These users may attempt to negatively impact the use or adoption of the Bitcoin Network. Investors may invest in bitcoin through means other than the Shares, including through direct investments in bitcoin and other potential financial vehicles, possibly including securities backed by or linked to bitcoin and digital asset financial vehicles similar to the Fund. In addition, to the extent digital asset financial vehicles other than the Fund tracking the price of bitcoin are formed and represent a significant proportion of the demand for bitcoin, large purchases or redemptions of the securities of these digital asset financial vehicles, or private funds holding bitcoin, could negatively affect the Index and the portion of the Shares value that is tied to bitcoin. The impact of geopolitical or economic events on the supply and demand for bitcoin is uncertain, but could motivate large-scale sales of bitcoin, which could result in a reduction in the Bitcoin Price and adversely affect the value of Shares. As an alternative to fiat currencies that are backed by central governments, digital assets such as bitcoin, which are relatively new, are subject to supply and demand forces based upon the desirability of an alternative, decentralized means of buying and selling goods and services, and it is unclear how such supply and demand will be impacted by geopolitical events. Nevertheless, political or economic crises may motivate large-scale acquisitions or sales of bitcoin either globally or locally. Large-scale sales of bitcoin would result in a reduction in the Bitcoin Price and could adversely affect the portion of the Shares value that is tied to bitcoin. Demand for bitcoin is driven, in part, by its status as the most prominent and secure digital asset. It is possible that a digital asset other than bitcoin could have features that make it more desirable to a material portion of the digital asset user base, resulting in a reduction in demand for bitcoin, which could have a negative impact on the price of bitcoin and adversely affect the value of Shares. Bitcoin was the first digital asset to gain global adoption and critical mass, and as a result, it has a "first to market" advantage over other digital assets. As of December 31, 2024, bitcoin was the largest digital asset by market capitalization and had the largest user base and largest combined mining power. Despite this first to market advantage, as of December 31, 2024, there were over 16,800 alternative digital assets tracked by CoinGecko.com, having a total market capitalization of approximately $3.7 trillion (including the approximately $2.06 trillion market capitalization of bitcoin), as calculated using market prices and total available supply of each digital asset. In addition, many consortiums and financial institutions are also researching and investing resources into private or permissioned smart contract platforms rather than open platforms like the Bitcoin Network. Competition from the emergence or growth of alternative digital assets and smart contracts platforms, such as Ethereum, Solana, Avalanche, Polkadot, or Cardano, could have a negative impact on the demand for, and price of, bitcoin and thereby adversely affect the value of the Shares. Investors may invest in bitcoin through means other than the Shares, including through direct investments in bitcoin and other potential financial vehicles, possibly including securities backed by or linked to bitcoin and digital asset financial vehicles similar to the Fund. In addition, to the extent digital asset financial vehicles other than the Fund tracking the price of bitcoin are formed and represent a significant proportion of the demand for bitcoin, large purchases or redemptions of the securities of these digital asset financial vehicles, or private funds holding bitcoin, could negatively affect the Index and the portion of the Shares value that is tied to bitcoin. Risks Related to the Custody of Bitcoin Failure to safeguard and manage our digital assets could adversely impact the Fund s business, operating results, and financial condition. The Fund s success and the success of its offerings requires significant public confidence in the Fund s and its partners abilities to properly manage customers balances and handle large and growing transaction volumes and amounts of customer assets. In addition, the Fund is dependent on its partners operations, liquidity, and financial condition for the proper maintenance, use, and safekeeping of these customer assets. Any failure by the Fund or its partners to maintain the necessary controls or to manage customer digital assets and funds appropriately and in compliance with applicable regulatory requirements could result in reputational harm, significant financial losses, lead customers to discontinue or reduce their use of the Fund s and its partners products, and result in significant penalties and fines and additional restrictions, which could adversely impact the Fund s business, operating results, and financial condition. The Bitcoin Custodian is responsible for the proper deposit, transfer, and custody of digital assets in multiple jurisdictions. The Bitcoin Custodian is required to safeguard customers assets using bank-level security standards. The Fund s security technology is designed to prevent, detect, and mitigate inappropriate access to its systems, by internal or external threats. The Fund believes the Bitcoin Custodian has developed and maintained administrative, technical, and physical safeguards designed to comply with applicable legal requirements and industry standards. However, it is nevertheless possible that hackers, employees or service providers acting contrary to the Bitcoin Custodian s policies, or others could circumvent these safeguards to improperly access the Fund s systems or documents, or the systems or documents of its business partners, agents, or service providers, and improperly access, obtain, misuse digital assets and funds. The methods used to obtain unauthorized access, disable, or degrade service or sabotage systems are also constantly changing and evolving and may be difficult to anticipate or detect for long periods of time. Any security incident resulting in a compromise of customer assets could result in substantial costs to the Fund and require the Fund to notify impacted individuals, and in some cases regulators, of a possible or actual incident, expose the Fund to regulatory enforcement actions, including substantial fines, limit the Fund s ability to provide services, subject the Fund to litigation, significant financial losses, damage the Fund s reputation, and adversely affect the Fund s business, operating results, financial condition, and cash flows. The loss or destruction of a private key required to access bitcoin may be irreversible. The Bitcoin Custodian s loss of access to a private key associated with the Fund s bitcoin could adversely affect an investment in the Shares. Transfers of bitcoin among users are accomplished via bitcoin transactions (i.e., sending bitcoin from one user to another). The creation of a bitcoin transaction requires the use of a unique numerical code known as a "private key." In the absence of the correct private key corresponding to a holder s particular bitcoin, the bitcoin is inaccessible. The custody of the Fund s bitcoin is collectively handled by the Bitcoin Custodian. If the internal procedures and controls of the Bitcoin Custodian are inadequate to safeguard the Fund s bitcoin holdings, and the Fund s private keys are lost, destroyed or otherwise compromised and no backup of the private keys is accessible, the Fund will be unable to access its bitcoin, which could adversely affect an investment in the Shares. In addition, if the Fund s private keys are misappropriated and the Fund s bitcoin holdings are stolen, the Fund could lose some or all of its bitcoin holdings, which could adversely impact the Fund. Security threats to the Fund s account at the Bitcoin Custodian could result in the halting of Fund operations and a loss of Fund assets or damage to the reputation of the Fund, each of which could result in a reduction in the value of the Shares. Security breaches, computer malware and computer hacking attacks have been a prevalent concern in relation to digital assets. The Sponsor believes that the Fund s bitcoin held in the Fund s account at the Bitcoin Custodian will be an appealing target to hackers or malware distributors seeking to destroy, damage or steal the Fund s bitcoin and will only become more appealing as the Fund s assets grow. To the extent that the Fund, the Sponsor or the Bitcoin Custodian is unable to identify and mitigate or stop new security threats or otherwise adapt to technological changes in the digital asset industry, the Fund s bitcoin may be subject to theft, loss, destruction or other attack. The Sponsor believes that the security procedures in place for the Fund, including but not limited to, offline storage, or cold storage, multiple encrypted private key "shards," and other measures, are reasonably designed to safeguard the Fund s bitcoin. Nevertheless, the security procedures cannot guarantee the prevention of any loss due to a security breach, software defect or act of God that may be borne by the Fund and the security procedures may not protect against all errors, software flaws or other vulnerabilities in the Fund s technical infrastructure, which could result in theft, loss or damage of its assets. The Sponsor does not control the Bitcoin Custodian s operations or their implementation of such security procedures and there can be no assurance that such security procedures will actually work as designed or prove to be successful in safeguarding the Fund s assets against all possible sources of theft, loss or damage. Assets not held in cold storage, such as assets held in a trading account, may be more vulnerable to security breach, hacking or loss than assets held in cold storage. The security procedures and operational infrastructure may be breached due to the actions of outside parties, error or malfeasance of an employee of the Sponsor, the Bitcoin Custodian, or otherwise, and, as a result, an unauthorized party may obtain access to the Fund s account at the Bitcoin Custodian, the relevant private keys (and therefore bitcoin) or other data or property of the Fund. Additionally, outside parties may attempt to fraudulently induce employees of the Sponsor or the Bitcoin Custodian to disclose sensitive information in order to gain access to the Fund s infrastructure. As the techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently, or may be designed to remain dormant until a predetermined event and often are not recognized until launched against a target, the Sponsor and the Bitcoin Custodian may be unable to anticipate these techniques or implement adequate preventative measures. An actual or perceived breach of the Fund s account at the Bitcoin Custodian could harm the Fund s operations, result in partial or total loss of the Fund s assets, resulting in a reduction or destruction in the value of the Shares. The Fund may also cease operations, the occurrence of which could similarly result in a reduction in the value of the Shares. Bitcoin transactions are irrevocable and stolen or incorrectly transferred bitcoin may be irretrievable. As a result, any incorrectly executed bitcoin transactions could adversely affect an investment in the Shares. Bitcoin transactions are typically not reversible without the consent and active participation of the recipient of the transaction. Once a transaction has been verified and recorded in a block that is added to the Blockchain, an incorrect transfer or theft of bitcoin generally will not be reversible, and the Fund may not be capable of seeking compensation for any such transfer or theft. Although the Fund s transfers of bitcoin will regularly be made to or from the Bitcoin Account, it is possible that, through computer or human error, or through theft or criminal action, the Fund s bitcoin could be transferred from the Bitcoin Account in incorrect amounts or to unauthorized third parties, or to uncontrolled accounts. To the extent that the Fund is unable to seek a corrective transaction with a third-party recipient of an unauthorized or incorrect transaction or is incapable of identifying the third party which has received the Fund s bitcoin through error or theft, the Fund will be unable to revert or otherwise recover incorrectly transferred bitcoin. The Fund will also be unable to convert or recover its bitcoin transferred to uncontrolled accounts. To the extent that the Fund is unable to seek redress for such error or theft, such loss could adversely affect the portion of the Shares value that is tied to bitcoin. The lack of full insurance and Shareholders limited rights of legal recourse against the Fund, Trustee, Sponsor, Trust Administrator, and Bitcoin Custodian expose the Fund and its Shareholders to the risk of loss of the Fund s bitcoin for which no person or entity is liable. The Fund is not a banking institution or otherwise a member of the Federal Deposit Insurance Corporation ("FDIC") or Securities Investor Protection Corporation ("SIPC") and, therefore, neither, Shareholders cannot be assured that the Bitcoin Custodian will maintain adequate insurance, that such coverage will cover losses with respect to the Fund s bitcoins, or that sufficient insurance proceeds will be available to cover the Fund s losses in full. The Bitcoin Custodian s insurance may not cover the type of losses experienced by the Fund. Alternatively, the Fund may be forced to share such insurance proceeds with other clients or customers of the Bitcoin Custodian, which could reduce the amount of such proceeds that are available to the Fund. The Fund is not a named insured under the Bitcoin Custodian s insurance policies, though the Bitcoin Custodian has represented to the Sponsor that the insurance covers customer losses, including losses suffered by the Fund, arising from specified events, including fraud, theft, and cyber-security breaches. In addition, the bitcoin insurance market is limited, and the level of insurance maintained by the Bitcoin Custodian may be substantially lower than the assets of the Fund, or the amount of claims against the Bitcoin Custodian of all of the customers whose losses are covered by the Bitcoin Custodian s insurance coverage. While the Bitcoin Custodian maintains certain capital reserve requirements depending on the assets under custody, and such capital reserves may provide additional means to cover client asset losses, the Fund cannot be assured that the Bitcoin Custodian will maintain capital reserves sufficient to cover actual or potential losses with respect to the Fund s digital assets. Furthermore, under the Bitcoin Custody Agreement, the Bitcoin Custodian s liability is limited in various ways, including that the Bitcoin Custodian cannot be held responsible for any failure or delay to act by the Bitcoin Custodian, its service providers, or its banks that is within the time limits permitted by the Bitcoin Custody Agreement, or that is caused by the Fund s negligence or is required to comply with applicable laws and regulations. The Bitcoin Custodian is not liable for any System Failure or Downtime (both as defined in the Bitcoin Custody Agreement), which prevents the Bitcoin Custodian from fulfilling its obligations under the Bitcoin Custody Agreement, provided that Bitcoin Custodian took reasonable care and used commercially reasonable efforts to prevent or limit such System Failures or Downtime and otherwise complied with the Bitcoin Custody Agreement. The Bitcoin Custody Agreement provides that "Downtime" means scheduled maintenance and a "System Failure" shall mean a failure of any computer hardware, software, computer systems, or telecommunications lines or devices used by the Bitcoin Custodian, or interruption, loss, or malfunction of utility, data center, Internet or network provider services used by the Bitcoin Custodian; provided, however, that a cybersecurity attack, data breach, hack, or other intrusion, or unauthorized disclosure by a third party, the Bitcoin Custodian, a service provider to the Bitcoin Custodian, or an agent or subcontractor of the Bitcoin Custodian, shall not be deemed a System Failure, to the extent such events or any losses arising therefrom are due to the Bitcoin Custodian s failure to comply with its obligations under the Bitcoin Custody Agreement. The Bitcoin Custodian cannot be held responsible for any circumstances beyond the Bitcoin Custodian s reasonable control, provided the Bitcoin Custodian took reasonable care and used commercially reasonable efforts in executing its responsibilities to the Fund pursuant to the Bitcoin Custody Agreement, which includes exercising the degree of care, diligence and skill that a prudent and competent professional provider of services similar to the custodial services would exercise in the circumstances, or such higher care where required by law or the Bitcoin Custody Agreement (collectively, the "Standard of Care"). The Bitcoin Custodian makes no guarantees regarding the Bitcoin network s security, functionality, or availability, and will not be liable for or in connection with any acts, decisions, or omissions made by developers of the Bitcoin network. The Bitcoin Custodian is not liable for any losses or claims arising out of actions that are in the Fund s control and related to the Fund s use of the Bitcoin Custodian s online platform, including but not limited to, the Fund s failure to follow security protocols, the Bitcoin Custodian s platform controls, improper instructions, failure to secure the Fund s credentials from third parties, or anything else in the Fund s control and is also not liable for any amount greater than the value of the assets on deposit in Fund s account at the Bitcoin Custodian at the time of, and directly relating to, the events giving rise to the liability occurred, the value of which shall be determined in accordance with the Chicago Mercantile Exchange Bitcoin Reference Rate or any successor thereto. The Bitcoin Custodian is not liable to the Fund (whether under contract, tort (including negligence) or otherwise) for any indirect, incidental, special, punitive or consequential losses suffered or incurred by the Fund (whether or not any such losses were foreseeable). The Bitcoin Custodian is not liable to the Fund or anyone else for any loss or injury resulting directly or indirectly from any damage or interruptions caused by any computer viruses, spyware, scamware, trojan horses, worms, or other malware that may affect the Fund s computer or other equipment, provided such malware did not originate from the Bitcoin Custodian or its agents. The Bitcoin Custody Agreement s "Force Majeure" provision provides that the Bitcoin Custodian is not liable for delays, suspension of operations, failure in performance, or interruption of service to the extent it is directly due to a cause or condition beyond the reasonable control of the Bitcoin Custodian including, but not limited to, any act of God, nuclear or natural disaster, epidemic, action or inaction of civil or military authorities, act of war, terrorism, sabotage, civil disturbance, strike or other labor dispute, accident, or state of emergency; provided, however, that for the avoidance of doubt, the Bitcoin Custody Agreement s Force Majeure provision shall not apply in respect of System Failures or Downtime, which are subject to other respective provisions of the Bitcoin Custody Agreement. The occurrence of an event described in the Force Majeure provision shall not affect the validity and enforceability of any remaining provisions of the Bitcoin Custody Agreement. In the event of potential losses incurred by the Fund as a result of the Bitcoin Custodian losing control of the Fund s bitcoins or failing to properly execute instructions on behalf of the Fund, the Bitcoin Custodian s liability with respect to the Fund will be subject to certain limitations which may allow it to avoid liability for potential losses or may be insufficient to cover the value of such potential losses. Furthermore, the insurance maintained by the Bitcoin Custodian may be insufficient to cover its liabilities to the Fund. Both the Fund and the Bitcoin Custodian are required to indemnify each other under certain circumstances. Subject to the Force Majeure provision and as limited by the limitations of liability in the Bitcoin Custody Agreement, the Bitcoin Custodian shall be liable to the Fund for the Loss (defined below) of any of the Fund s bitcoin or fiat currency to the extent that such Loss was caused by the negligence, fraud, willful or reckless misconduct of the Bitcoin Custodian or breach by the Bitcoin Custodian of its Standard of Care. The Bitcoin Custody Agreement provides that "Loss" means if, at any time the Fund s Bitcoin Account or Fiat Account, as applicable, does not hold the bitcoin or fiat currency that had been (1) received by Bitcoin Custodian in connection with the Fund s Bitcoin Account or Fiat Account pursuant to the Bitcoin Custody Agreement, or (2) duly sent to the Bitcoin Custodian by the Fund or Authorized Participants in connection with the Fund s Bitcoin Account pursuant to the Bitcoin Custody Agreement but not received because of a failure caused by the Bitcoin Custodian. The Bitcoin Custody Agreement provides that "Loss" shall include situations where the Bitcoin Custodian fails to execute a valid withdrawal request, bitcoin are withdrawn from the Fund s Bitcoin Account other than pursuant to a withdrawal request, or the Fund is not able to timely withdraw bitcoin from the Bitcoin Account pursuant to a withdrawal request, in each case due to a failure caused by the Bitcoin Custodian; provided, however, that the Bitcoin Custodian s failure to permit timely withdrawals because it has determined that it cannot do so due to the requirements of applicable laws and regulations or because of the operation of its fraud detection controls shall not be considered a Loss, provided the Bitcoin Custodian is acting reasonably and in good faith. The Bitcoin Custody Agreement provides that should a Loss of the Fund s bitcoin or fiat currency due to the negligence, fraud, willful or reckless misconduct of the Bitcoin Custodian or a breach by the Bitcoin Custodian of its Standard of Care occur, the Bitcoin Custodian will, as soon as practicable, return to the Fund a quantity of the same digital asset that is equal to the quantity of digital assets involved in the Loss, or return to the Fund a quantity of the same fiat currency that is equal to the quantity of fiat currency involved in the Loss (if the Loss involved the Fiat Account). However, the Fund does not control the Bitcoin Custodian and cannot guarantee that the Bitcoin Custodian will perform its obligations to the Fund under the Bitcoin Custody Agreement, in a timely manner or at all. The Bitcoin Custody Agreement provides that (i) the Bitcoin Custodian does not own or control the underlying software protocols of networks which govern the operation of digital assets (including the Bitcoin Blockchain), (ii) the Bitcoin Custodian makes no guarantees regarding their security, functionality, or availability, and (iii) in no event shall the Bitcoin Custodian be liable for or in connection with any acts, decisions, or omissions made by developers or promoters of digital assets, including bitcoin. Similarly, under the Clearing Agreement, the Bitcoin Custodian s liability in connection with the Clearing Services is limited as follows, among others: the Bitcoin Custodian does not have any responsibility for any sale or purchase of bitcoin for cash to a Liquidity Provider through the Clearing Services (such a transaction, a "Clearing Transaction"), other than as specifically identified in the Clearing Agreement. The Bitcoin Custodian may rely upon, without liability on its part, any clearing request submitted through Gemini s platform. Absent gross negligence, willful misconduct or fraud, the Bitcoin Custodian shall not be liable for any loss resulting from a clearing request or the use of Clearing Services. Validation and confirmation procedures used by Gemini are designed only to verify the source of clearing requests and that each party has met its respective obligations in respect of a clearing request and not to detect errors in the content of a clearing request or to prevent duplicate clearing requests. The Fund is responsible for losses resulting from clearing requests provided by it and for any errors made by or on behalf of the Fund, any errors resulting, directly or indirectly, from fraud or the duplication of any clearing request by or on behalf of the Fund, or any losses resulting from the malfunctioning of any devices used by the Fund or loss or compromise of credentials used by the Fund to deliver clearing requests. The Bitcoin Custodian may reject, refuse to settle or otherwise not complete any request to settle a bitcoin transaction through the Clearing Services for any reason necessary to comply with applicable laws and regulations or in connection with its fraud or other compliance controls and systems, and the Bitcoin Custodian shall have no liability whatsoever to the Fund, any transaction counterparty or any other party in connection with or arising out of the Bitcoin Custodian rejecting, refusing or otherwise not completing the settlement of a transaction through the Clearing Services. The Bitcoin Custodian will not settle transactions through the Clearing Services: (i) if either party to a Clearing Transaction has not fully funded its accounts held with the Bitcoin Custodian and used in connection with the Clearing Services (in the Fund s case, the Clearing Account and Fiat Account), as applicable, with the required fiat currency amount or bitcoin amount, as applicable, prior to the agreed expiration time; (ii) if either party to a Clearing Transaction has not confirmed its acceptance of the clearing request to the Bitcoin Custodian prior to the agreed expiration time; (iii) if either party to a transaction is not a Gemini customer; or (iv) for any other reason as determined by the Bitcoin Custodian in its sole discretion to comply with applicable laws and regulation or in connection with the Bitcoin Custodian s fraud or other compliance controls and systems. Although the Bitcoin Custodian has represented to the Sponsor that Clearing Transactions ordinarily settle automatically within minutes once the bitcoin and cash have been funded by both the Fund and the Liquidity Provider in their respective accounts at the Bitcoin Custodian used in connection with the Clearing Services (in the Fund s case, the Clearing Account and Fiat Account), the Bitcoin Custodian is not required by the Clearing Agreement to settle the Clearing Transaction that quickly. These and the other limitations on the Bitcoin Custodian s liability may allow it to avoid liability for potential losses, even if the Bitcoin Custodian directly caused such losses. The Clearing Agreement provides that it is subject to Gemini s User Agreement. Pursuant to Gemini s User Agreement, Gemini agrees to take reasonable care and use commercially reasonable efforts in executing Gemini s responsibilities to the Fund pursuant to the User Agreement, or such higher care where required by law or as specified by the User Agreement. Gemini uses commercially reasonable efforts to provide the Fund with a reliable and secure platform. From time to time, interruptions, errors or other deficiencies in service may occur due to a variety of factors, some of which are outside of our control. These factors can contribute to delays, errors in service, or system outages, creating difficulties in accessing the Fund s account, withdrawing fiat currency or bitcoin, depositing fiat currency or bitcoin, and/or placing and/or canceling orders. Under the User Agreement, Gemini is not liable for any delays, failure in performance or interruption of service which result directly or indirectly from any cause or condition, whether or not foreseeable, beyond Gemini s reasonable control, including, but not limited to, any act of God, nuclear or natural disaster, epidemic, action or inaction of civil or military authorities, act of war, terrorism, sabotage, civil disturbance, strike or other labor dispute, accident, state of emergency or interruption, loss, or malfunction of equipment or utility, communications, computer (hardware or software), Internet or network provider services. Except to the extent required by law, Gemini is not liable under the User Agreement, whether in contract or tort, for any punitive, special, indirect, consequential, incidental, or similar damages, including lost trading or other profits, diminution in asset value, or lost business opportunities (even if Gemini have been advised of the possibility thereof) in connection with the transactions subject to the User Agreement. Gemini s total liability for breach of the User Agreement shall be limited by the value of any of the Fund s allegedly lost fiat currency and digital assets in the custody of Gemini at the time of loss. Under the User Agreement Gemini is not liable for delays or interruptions in service caused by automated or other compliance checks or for other reasonable delays or interruptions in service, by definition to include any delay or interruption shorter than one week, or delays or interruptions in service beyond the control of Gemini or its service providers. The limitation on liability under the User Agreement includes, but is not limited to any damage or interruptions caused by any computer viruses, spyware, scamware, trojan horses, worms, or other malware that may affect the Fund s computer or other equipment, or any phishing, spoofing, domain typosquatting, or other attacks, failure of mechanical or electronic equipment or communication lines, telephone or other interconnect problems (e.g., you cannot access your internet service provider), unauthorized access, theft, operator errors, strikes or other labor problems, or any force majeure. Gemini does not guarantee continuous, uninterrupted, or secure access to Gemini. Gemini is not responsible for any failure or delay to act by any Gemini service provider, including Gemini s banks, or any other participant that is within the time limits permitted by the User Agreement or prescribed by law, or that is caused by the Fund s negligence. Under the User Agreement, Gemini is not responsible for any "System Failure" (defined as a failure of any computer hardware or software used by Gemini, a Gemini service provider, or any telecommunications lines or devices used by Gemini or a Gemini service provider), or scheduled or unscheduled maintenance or downtime, which prevents Gemini from fulfilling its obligations under the User Agreement, provided that Gemini used commercially reasonable efforts to prevent or limit such System Failures, or downtime. Gemini cannot be held responsible for any other circumstances beyond Gemini s reasonable control. Moreover, in the event of an insolvency or bankruptcy of the Bitcoin Custodian in the future, given that the contractual protections and legal rights of customers with respect to digital assets held on their behalf by third parties are relatively untested in a bankruptcy of an entity such as the Bitcoin Custodian in the virtual currency industry, there is a risk that customers assets – including the Fund s assets – may be considered the property of the bankruptcy estate of the Bitcoin Custodian, and customers – including the Fund – may be at risk of being treated as general unsecured creditors of such entities and subject to the risk of total loss or markdowns on value of such assets. The Bitcoin Custody Agreement contains an agreement by the parties to treat the bitcoin credited to the Fund s Vault Balance as financial assets under Article 8 of the New York Uniform Commercial Code ("Article 8"), in addition to stating that the Bitcoin Custodian will serve as fiduciary and custodian on the Fund s behalf. It is possible that a court would not treat custodied digital assets as part of the Bitcoin Custodian s general estate in the event the Bitcoin Custodian were to experience insolvency. However, due to the novelty of digital asset custodial arrangements courts have not yet considered this type of treatment for custodied digital assets and it is not possible to predict with certainty how they would rule in such a scenario. In the case of the Clearing Account, because it is an omnibus account in which the assets of multiple customers – including the Fund s assets – are held together, it is likely the Fund would be treated as a general unsecured creditor in respect of the Clearing Account held with the Bitcoin Custodian in the event of the Bitcoin Custodian s insolvency. The Clearing Agreement does not contain an Article 8 opt-in. If the Bitcoin Custodian became subject to insolvency proceedings and a court were to rule that the custodied bitcoin were part of the Bitcoin Custodian s general estate and not the property of the Fund, then the Fund would be treated as a general unsecured creditor in the Bitcoin Custodian s insolvency proceedings and the Fund could be subject to the loss of all or a significant portion of its assets. Moreover, in the event of the bankruptcy of the Bitcoin Custodian, an automatic stay could go into effect and protracted litigation could be required in order to recover the assets held with the Bitcoin Custodian, all of which could significantly and negatively impact the Fund s operations and the value of the Shares. Under the Fund Agreement, the Trustee and the Sponsor will not be liable for any liability or expense incurred, including, without limitation, as a result of any loss of bitcoin by the Bitcoin Custodian, absent gross negligence or bad faith on the part of the Trustee or the Sponsor or breach by the Sponsor of the Fund Agreement, as the case may be. As a result, the recourse of the Fund or the Shareholders to the Trustee or the Sponsor, including in the event of a loss of bitcoin by the Bitcoin Custodian, is limited. The Shareholders recourse against the Sponsor, the Trustee, and the Fund s other service providers for the services they provide to the Fund, including, without limitation, those relating to the holding of bitcoin or the provision of instructions relating to the movement of bitcoin, is limited. For the avoidance of doubt, neither the Sponsor, the Trustee, nor any of their affiliates, nor any other party has guaranteed the assets or liabilities, or otherwise assumed the liabilities, of the Fund, or the obligations or liabilities of any service provider to the Fund, including, without limitation, the Bitcoin Custodian. Consequently, a loss may be suffered with respect to the Fund s bitcoin that is not covered by the Bitcoin Custodian s insurance and for which no person is liable in damages. As a result, the recourse of the Fund or the Shareholders, under applicable law, is limited. Risks Related to the Regulation of Bitcoin Digital asset markets in the U.S. exist in a state of regulatory uncertainty, and adverse legislative or regulatory developments could significantly harm the value of bitcoin or the Shares, such as by banning, restricting or imposing onerous conditions or prohibitions on the use of bitcoin, mining activity, digital wallets, the provision of services related to trading and custodying bitcoin, the operation of the Bitcoin Network, or the digital asset markets generally. There is a lack of consensus regarding the regulation of digital assets, including bitcoin, and their markets. As a result of the growth in the size of the digital asset market, as well as the 2022 Events, the U.S. Congress and a number of U.S. federal and state agencies (including FinCEN, SEC, OCC, CFTC, FINRA, the Consumer Financial Protection Bureau ("CFPB"), the Department of Justice, the Department of Homeland Security, the Federal Bureau of Investigation, the IRS, state financial institution regulators, and others) have been examining the operations of digital asset networks, digital asset users and the digital asset markets. Many of these state and federal agencies have brought enforcement actions or issued consumer advisories regarding the risks posed by digital assets to investors. Ongoing and future regulatory actions with respect to digital assets generally or bitcoin in particular may alter, perhaps to a materially adverse extent, the nature of an investment in the Shares, the portion of the Shares value that is tied to bitcoin, or the ability of the Fund to continue to operate. The 2022 Events, including among others the bankruptcy filings of FTX and its subsidiaries, Three Arrows Capital, Celsius Network, Voyager Digital, Genesis, BlockFi and others, and other more recent developments in the digital asset markets, have resulted in calls for heightened scrutiny and regulation of the digital asset industry, with a specific focus on intermediaries such as digital asset exchanges, platforms and custodians. Federal and state legislatures and regulatory agencies may introduce and enact new laws and regulations to regulate crypto asset intermediaries, such as digital asset exchanges and custodians. The March 2023 collapses of Silicon Valley Bank, Silvergate Bank, and Signature Bank, which in some cases provided services to the digital assets industry, may amplify and/or accelerate these trends. On January 3, 2023, the federal banking agencies issued a joint statement on crypto-asset risks to banking organizations following events which exposed vulnerabilities in the crypto-asset sector, including the risk of fraud and scams, legal uncertainties, significant volatility, and contagion risk. Although banking organizations are not prohibited from crypto-asset related activities, the agencies have expressed significant safety and soundness concerns with business models that are concentrated in crypto-asset related activities or have concentrated exposures to the crypto-asset sector. US federal and state regulators, as well as the White House, have issued reports and releases concerning crypto assets, including Bitcoin and crypto asset markets. Further, in 2023 the House of Representatives formed two new subcommittees: the Digital Assets, Financial Technology and Inclusion Subcommittee and the Commodity Markets, Digital Assets, and Rural Development Subcommittee, each of which were formed in part to analyze issues concerning crypto assets and demonstrate a legislative intent to develop and consider the adoption of federal legislation designed to address the perceived need for regulation of and concerns surrounding the crypto industry. However, the extent and content of any forthcoming laws and regulations are not yet ascertainable with certainty, and it may not be ascertainable in the near future. A divided Congress makes any prediction difficult. The Fund cannot predict how these and other related events will affect it or the crypto asset business. In August 2021, the chair of the SEC stated that he believed investors using digital asset trading platforms are not adequately protected, and that activities on the platforms can implicate the securities laws, commodities laws and banking laws, raising a number of issues related to protecting investors and consumers, guarding against illicit activity, and ensuring financial stability. The chair expressed a need for the SEC to have additional authorities to prevent transactions, products, and platforms from "falling between regulatory cracks," as well as for more resources to protect investors in "this growing and volatile sector." The chair called for federal legislation centering on digital asset trading, lending, and decentralized finance platforms, seeking "additional plenary authority" to write rules for digital asset trading and lending. It is not possible to predict whether Congress will grant additional authorities to the SEC or other regulators, what the nature of such additional authorities might be, how they might impact the ability of digital asset markets to function or how any new regulations that may flow from such authorities might impact the value of digital assets generally and bitcoin held by the Fund specifically. The consequences of increased federal regulation of digital assets and digital asset activities could have a material adverse effect on the Fund and the Shares. In June 2023, the SEC filed lawsuits against Coinbase and Binance, two large U.S. digital asset trading platforms, alleging that Coinbase and Binance had been operating as unregistered securities exchanges, brokers and clearing agencies in violation of U.S. federal securities laws. While the SEC has not alleged that bitcoin is a security, the outcome of these enforcement actions and others may result in the substantial restructuring of the digital asset market in the United States. However, the SEC has recently faced setbacks in U.S. courts in its attempt to regulate the digital asset markets. In July 2023, the U.S. District Court for the Southern District of New York ruled on the SEC s action against Ripple Labs, Inc. The court found that offers and sales of XRP, a digital token, to institutions and sophisticated individuals constituted securities transactions, but that offers and sales of XRP on crypto exchanges, distributions to employees, and other third-party developers were not securities transactions. More recently, the D.C. Circuit Court found that the SEC s denial of the Grayscale Bitcoin Trust s listing was "arbitrary and capricious" under the Administrative Procedures Act in light of the SEC s approval of two similar bitcoin futures-based ETPs. Nonetheless, until the SEC s numerous actions against digital asset market participants are resolved, the structure of the digital asset market in the United States will remain subject to substantial regulatory risk, which may impact the demand for digital assets and the continued availability of existing exchanges and offerings. FinCEN requires any administrator or exchanger of convertible digital assets to register with FinCEN as a money transmitter and comply with the anti-money laundering ("AML") regulations applicable to money transmitters. Entities which fail to comply with such regulations are subject to fines, may be required to cease operations, and could have potential criminal liability. For example, in 2015, FinCEN assessed a $700,000 fine against a sponsor of a digital asset for violating several requirements of the Bank Secrecy Act by acting as a money services business, or "MSB," and selling the digital asset without registering with FinCEN, and by failing to implement and maintain an adequate AML program. In 2017, FinCEN assessed a $110 million fine against BTC-e, a now defunct digital asset exchange, for similar violations. The requirement that exchangers that do business in the U.S. register with FinCEN and comply with AML regulations may increase the cost of buying and selling bitcoin and therefore may adversely affect the price of bitcoin and an investment in the Shares. The Office of Foreign Assets Control ("OFAC") of the U.S. Department of the Treasury (the "U.S. Treasury Department") has added digital currency addresses to the list of Specially Designated Nationals whose assets are blocked, and with whom U.S. persons are generally prohibited from dealing. Such actions by OFAC, or by similar organizations in other jurisdictions, may introduce uncertainty in the market as to whether bitcoin that has been associated with such addresses in the past can be easily sold. This "tainted" bitcoin may trade at a substantial discount to untainted bitcoin. Reduced fungibility in the digital asset markets may reduce the liquidity of bitcoin and therefore adversely affect their price. In February 2020, then-U.S. Treasury Secretary Steven Mnuchin stated that digital assets were a "crucial area" on which the U.S. Treasury Department has spent significant time. Secretary Mnuchin announced that the U.S. Treasury Department is preparing significant new regulations governing digital asset activities to address concerns regarding the potential use for facilitating money laundering and other illicit activities. In December 2020, FinCEN, a bureau within the U.S. Treasury Department, proposed a rule that would require financial institutions to submit reports, keep records, and verify the identity of customers for certain transactions to or from so-called "unhosted" wallets, also commonly referred to as self-hosted wallets. In January 2021, U.S. Treasury Secretary nominee Janet Yellen stated her belief that regulators should "look closely at how to encourage the use of digital assets for legitimate activities while curtailing their use for malign and illegal activities." Under regulations from the New York State Department of Financial Services ("NYDFS"), businesses involved in digital asset business activity for third parties in or involving New York, excluding merchants and consumers, must apply for a license, commonly known as a BitLicense, from the NYDFS and must comply with AML, cyber security, consumer protection, and financial and reporting requirements, among others. As an alternative to a BitLicense, a firm can apply for a charter to become a limited purpose trust company under New York law qualified to engage in certain digital asset business activities. Other states have considered or approved digital asset business activity statutes or rules, passing, for example, regulations or guidance indicating that certain digital asset business activities constitute money transmission requiring licensure. The inconsistency in applying money transmitting licensure requirements to certain businesses may make it more difficult for these businesses to provide services, which may affect consumer adoption of bitcoin and its price. In an attempt to address these issues, the Uniform Law Commission passed a model law in July 2017, the Uniform Regulation of Virtual Currency Businesses Act, which has many similarities to the BitLicense and features a multistate reciprocity licensure feature, wherein a business licensed in one state could apply for accelerated licensure procedures in other states. It is still unclear, however, how many states, if any, will adopt some or all of the model legislation. Law enforcement agencies have often relied on the transparency of blockchains to facilitate investigations. However, certain privacy-enhancing features have been, or are expected to be, introduced to a number of digital asset networks. If the Bitcoin Network were to adopt any of these features, these features may provide law enforcement agencies with less visibility into transaction-level data. Europol, the European Union s law enforcement agency, released a report in October 2017 noting the increased use of privacy-enhancing digital assets like Zcash and Monero in criminal activity on the internet. Although no regulatory action has been taken to treat privacy-enhancing digital assets differently, this may change in the future. A determination that bitcoin or any other digital asset is a "security" may adversely affect the value of bitcoin and the portion of the Shares value that is tied to bitcoin, and result in potentially extraordinary, nonrecurring expenses to, or termination of, the Fund. Depending on its characteristics, a digital asset may be considered a "security" under the federal securities laws. The test for determining whether a particular digital asset is a "security" is complex and difficult to apply, and the outcome is difficult to predict. Public, though non-binding, statements by senior officials at the SEC indicate that the SEC does not consider bitcoin to be a security, at least currently, and the staff has provided informal assurances to a handful of promoters that their digital assets are not securities. On the other hand, the SEC has brought enforcement actions against the promoters of several other digital assets on the basis that the digital assets in question are securities. Whether a digital asset is a security under the federal securities laws depends on whether it is included in the lists of instruments making up the definition of "security" in the Securities Act, the Exchange Act and the Investment Company Act. Digital assets as such do not appear in any of these lists, although each list includes the terms "investment contract" and "note," and the SEC has typically analyzed whether a particular digital asset is a security by reference to whether it meets the tests developed by the federal courts interpreting these terms, known as the Howey and Reves tests, respectively. For many digital assets, whether or not the Howey or Reves tests are met is difficult to resolve definitively, and substantial legal arguments can often be made both in favor of and against a particular digital asset qualifying as a security under one or both of the Howey and Reves tests. Adding to the complexity, the SEC staff has indicated that the security status of a particular digital asset can change over time as the relevant facts evolve. As part of determining whether bitcoin is a security for purposes of the federal securities laws, the Sponsor takes into account a number of factors, including the various definitions of "security" under the federal securities laws and federal court decisions interpreting elements of these definitions, such as the U.S. Supreme Court s decisions in the Howey and Reves cases, as well as reports, orders, press releases, public statements and speeches by the SEC and its staff providing guidance on when a digital asset may be a security for purposes of the federal securities laws. Finally, the Sponsor discusses the security status of bitcoin with its external securities lawyers. Through this process the Sponsor believes that it is applying the proper legal standards in determining that bitcoin is not a security in light of the uncertainties inherent in the Howey and Reves tests. However, because of these uncertainties, the Sponsor acknowledges that bitcoin may in the future be found by the SEC or a federal court to be a security notwithstanding the Sponsor s prior conclusion; and the Sponsor s prior conclusion, even if reasonable under the circumstances, would not preclude legal or regulatory action based on the presence of a security. The Sponsor may dissolve the Fund if the Sponsor determines bitcoin is a security under the federal securities laws, whether that determination is initially made by the Sponsor itself, or because the SEC or a federal court subsequently makes that determination. Because the legal tests for determining whether a digital asset is or is not a security often leave room for interpretation, for so long as the Sponsor believes there to be good faith grounds to conclude that the Fund s bitcoin is not a security, the Sponsor does not intend to dissolve the Fund on the basis that bitcoin could at some future point be determined to be a security. Any enforcement action by the SEC or a state securities regulator asserting that bitcoin is a security, or a court decision, to that effect would be expected to have an immediate material adverse impact on the trading value of Bitcoin, as well as the Shares. This is because the business models behind most digital assets are incompatible with regulations applying to transactions in securities. If a digital asset is determined or asserted to be a security, it is likely to become difficult or impossible for the digital asset to be traded, cleared or custodied in the United States through the same channels used by non-security digital assets, which in addition to materially and adversely affecting the trading value of the digital asset is likely to significantly impact its liquidity and market participants ability to convert the digital asset into U.S. dollars. For example, in 2020 the SEC filed a complaint against the promoters of XRP alleging that they raised more than $1.3 billion through XRP sales that should have been registered under the federal securities laws, but were not. In the years prior to the SEC s action, XRP s market capitalization at times reached over $100 billion. However, in the weeks following the SEC s complaint, XRP s market capitalization fell to less than $10 billion, which was less than half of its market capitalization in the days prior to the complaint. In July 2023, the U.S. District Court for the Southern District of New York ruled on the SEC s action against Ripple Labs, Inc. The court found that offers and sales of XRP to institutions and sophisticated individuals constituted securities transactions, but that offers and sales of XRP on crypto exchanges, distributions to employees, and other third-party developers were not securities transactions. The SEC s action against XRP s promoters underscores the continuing uncertainty around which digital assets are securities, and demonstrates that such factors as how long a digital asset has been in existence, how widely held it is, how large its market capitalization is and that it has actual usefulness in commercial transactions, ultimately may have no bearing on whether the SEC or a court will find it to be a security. In addition, if bitcoin is determined to be a security, the Fund could be considered an unregistered "investment company" under SEC rules, which could necessitate the Fund s liquidation. In this case, the Fund and the Sponsor may be deemed to have participated in an illegal offering of securities and there is no guarantee that the Sponsor will be able to register the Fund under the Investment Company Act at such time or take such other actions as may be necessary to ensure the Fund s activities comply with applicable law, which could force the Sponsor to liquidate the Fund. Moreover, whether or not the Sponsor or the Fund were subject to additional regulatory requirements as a result of any SEC or federal court determination that its assets include securities, the Sponsor may nevertheless decide to terminate the Fund, in order, if possible, to liquidate the Fund s assets while a liquid market still exists. As a result, if the SEC or a federal court were to determine that bitcoin is a security, it is likely that the portion of the Shares value that is tied to bitcoin would decline significantly, and that the Fund itself would be terminated and, if practical, its assets liquidated. Future and current regulations by a U.S. or foreign government or quasi-governmental agency could have an adverse effect on an investment in the Fund. The regulation of bitcoin and related products and services continues to evolve, may take many different forms and will, therefore, impact the Bitcoin Network and bitcoin and their usage in a variety of manners. The inconsistent and sometimes conflicting regulatory landscape may make it more difficult for bitcoin businesses to provide services, which may impede the growth of the bitcoin economy and have an adverse effect on consumer adoption of bitcoin. There is a possibility of future regulatory change altering, perhaps to a material extent, the nature of an investment in the Shares or the ability of the Fund to continue to operate. Changes to current regulatory determinations of bitcoin s status under federal or state securities laws, changes to regulations surrounding bitcoin futures or related products, or actions by a U.S. or foreign government or quasi-governmental agency exerting regulatory authority over bitcoin, the Bitcoin Network, bitcoin trading, or related activities impacting other parts of the digital asset market, may adversely impact bitcoin and therefore may have an adverse effect on the value of an investment in the Fund. If the Bitcoin Network is used to facilitate illicit activities or evade sanctions, businesses that facilitate transactions in bitcoin could be at increased risk of criminal or civil lawsuits, or of having services cut off, which could negatively affect the price of bitcoin and the value of the Shares. Digital asset networks have in the past been, and may continue to be, used to facilitate illicit activities. If the Bitcoin Network is used to facilitate illicit activities or evade sanctions, businesses that facilitate transactions in bitcoin could be at increased risk of potential criminal or civil lawsuits, or of having banking or other services cut off, and bitcoin could be removed from digital asset trading platforms as a result of these concerns. Other service providers of such businesses may also cut off services if there is a concern that the Bitcoin Network is being used to facilitate crime. Any of the aforementioned occurrences could increase regulatory scrutiny of the Bitcoin Network and/or adversely affect the price of bitcoin, the attractiveness of the Bitcoin Network and an investment in the Shares of the Trust. The Fund and the Sponsor, acting on behalf of the Fund, directly interact with parties that are themselves subject to AML program requirements under the Bank Secrecy Act or similar laws. The Authorized Purchasers are registered broker-dealers or financial institutions exempt from broker-dealer registration and therefore are subject to AML and countering the financing of terrorism obligations under the Bank Secrecy Act as administered by FinCEN and further overseen by the SEC and FINRA. In accordance with its regulatory obligations, the Authorized Purchasers conduct customer due diligence. When the Fund and the Sponsor, acting on behalf of the Fund, buy, sell or deliver, as applicable, bitcoin, they transact directly with financial institution counterparties that are subject to U.S. federal and/or state licensing requirements or similar laws in non-U.S. jurisdictions and maintain practices and policies designed to comply with AML and KYC regulations or similar laws in non-U.S. jurisdictions. The Fund will not hold any bitcoin except those that have been delivered by the Fund s Bitcoin Trading Counterparties in connection with creation requests. If the Sponsor, the Fund, or an Authorized Purchaser were nevertheless to transact with such a sanctioned entity, the Sponsor, the Fund, and such Authorized Purchaser would be at increased risk of potential criminal or civil lawsuits. Risks Related to Carbon Credit Futures and the Fund s Status as a Commodity Pool The Fund is subjected to exposure to risks of futures contracts. The primary risks associated with the use of futures contracts include: (a) an imperfect correlation between the change in market value of the reference asset and the price of the futures contract; (b) possible lack of a liquid secondary market for a futures contract and the resulting inability to close a futures contract when desired; (c) losses caused by unanticipated market movements, which are potentially unlimited; (d) the inability to predict correctly the direction of market prices, interest rates, currency exchange rates and other economic factors; and (e) risks associated with the underlying asset. Market fraud and/or manipulation and other fraudulent trading practices such as the intentional dissemination of false or misleading information (e.g., false rumors) can, among other things, lead to a disruption of the orderly functioning of markets, significant market volatility, and cause the value of Carbon Credit Futures to fluctuate quickly and without warning. Depending on the timing of an investor s purchases and sales of the Fund s Shares, these pricing anomalies could cause the investor to incur losses. As a futures contract the Fund owns approaches its settlement date, the Fund may sell that futures contract and reinvest the proceeds in a similar contract with a more distant settlement date. This process is referred to as "rolling" a futures contract. The successful use of such a strategy depends upon the Sponsor s skill and experience. Although the Fund will attempt to roll from an expiring futures contract to another contract to mirror that of the Index, the Fund nevertheless may incur a cost to "roll" the contract. In a commodity futures market where current month expiring contracts trade at a lower price than next month s contract, a situation referred to as "contango," absent the impact of the overall movement in commodity prices, the Fund may experience an adverse impact because it would be selling less expensive contracts and buying more expense contracts. In the event of a prolonged period of contango, and absent the impact of rising or falling commodity prices, there could be a significant negative impact on the Fund when it "rolls" its futures contract positions. Futures contracts are subject to inherent leverage risk because they are typically secured by margin deposits representing a small percentage of a futures contract s entire market value. Commodity pools trading positions in futures contracts are typically required to be secured by the deposit of margin funds that represent only a small percentage of a futures contract s entire market value. This feature creates the potential for commodity pools to "leverage" their assets by purchasing or selling futures contracts with an aggregate notional amount in excess of the commodity pool s assets. The Fund is subject to the risks associated with Commodity-Linked Derivatives. The value of a commodity-linked derivative investment typically is based upon the price movements of a physical commodity and may be affected by changes in overall market movements, volatility of an index, changes in interest rates, or factors affecting a particular industry or commodity, such as drought, floods, weather, embargoes, tariffs and international economic, political and regulatory developments. Investments in commodity-linked derivatives may be subject to greater volatility than non-derivative based investments. Commodity-linked derivatives also may be subject to credit and interest rate risks that in general affect the values of debt securities. The Fund s usage of commodities derivatives investments involves additional, and potentially greater, risks of investing in the underlying asset directly. The use of derivatives (including futures and forwards) involves risks different from, or possibly greater than, the risks of investing directly in the underlying commodity. These risks include, but are not limited to, leverage risk, liquidity risk, valuation risk, market risk, counterparty risk, and credit risk. Derivatives may at times be highly illiquid, and the Fund may not be able to close out or sell a derivative at a particular time or at an anticipated price. Derivatives can be difficult to value and valuation may be more difficult in times of market turmoil. There may be imperfect correlation between the derivative and that of the reference asset, resulting in unexpected returns that could materially adversely affect the Fund. Derivatives are also subject to additional risks such as operational risk, including settlement issues, and legal risk, including that underlying documentation is incomplete or ambiguous. Certain derivatives (such as swaps and options) are bi-lateral agreements that expose the Fund to counterparty risk. A counterparty (the other party to a transaction or an agreement or the party with which the Fund executes transactions) to a transaction with the Fund may be unable or unwilling to make timely principal, interest or settlement payments, or otherwise honor its obligations. If the counterparty or its affiliate becomes insolvent, bankrupt or defaults on its payment obligations to the Fund, the value of an investment held by the Fund may decline. Additionally, if any collateral posted by the counterparty for the benefit of the Fund is insufficient or there are delays in the Fund s ability to access such collateral, the Fund may not be able to achieve its investment objective. In addition, the Fund may enter into transactions with a limited number of counterparties, which may increase the Fund s exposure to counterparty credit risk. Further, there is a risk that no suitable counterparties will be willing to enter into, or continue to enter into, transactions with the Fund and, as a result, the Fund may not be able to achieve its inverse investment objective or may decide to change its inverse investment objective. Position limits and margin requirements, among other limitations, may have the potential to cause tracking error, which could cause the price of Shares to substantially vary from the Index. If the Fund s ability to obtain exposure to Carbon Credit Futures to mirror the exposure of the Index is disrupted for any reason, including but not limited to, limited liquidity in the Carbon Credit Futures markets, a disruption to the Carbon Credit Futures market, or as a result of margin requirements or position limits imposed by the Fund s FCMs, the exchanges on which the Carbon Credit Futures trade, or the CFTC, the Fund would not be able to achieve its investment objective and may experience significant losses. Position limits, accountability limits and dynamic price fluctuation limits may limit the Fund s ability to invest the proceeds of Baskets in Carbon Credit Futures. As a result, when the Fund sells Baskets it may be limited in its ability to invest in Carbon Credit Futures. In such a case, the Fund may hold larger amounts of cash and cash equivalents, which will impair the Fund s ability to meet its investment objective of tracking the Index. Price fluctuation limits may contribute to a lack of liquidity and have a negative impact on Fund performance. During periods of market illiquidity, including periods of market disruption and volatility, it may be difficult or impossible for the Fund to buy or sell futures at desired prices or at all. The Fund is subject to the regulatory risks associated with being a commodity pool. Under regulations promulgated by the CFTC, the Fund is considered a commodity pool, and therefore is subject to regulation under the CEA and CFTC rules. The Sponsor is registered as a CPO and CTA and manages the investments of the Fund in accordance with its investment objective and strategies, as well as in accordance with CFTC rules. Commodity pools are subject to additional laws, regulations and enforcement policies, all of which may potentially increase compliance costs and may affect the operations and financial performance of the Fund. Additionally, positions in commodity-linked derivative instruments may have to be liquidated at disadvantageous times or prices to prevent the Fund from exceeding any applicable position limits established by the CFTC. Such actions may subject the Fund to substantial losses. Registration of the Sponsor as a CPO imposes additional compliance obligations on the Sponsor and the Fund related to additional laws, regulations and enforcement policies, which could increase compliance costs and may affect the operations and financial performance of the Fund. The Fund s investment exposure to carbon credit futures contracts will cause it to be deemed to be a commodity pool, thereby subjecting the Fund to regulation under the CEA and CFTC regulations. The Sponsor is registered as a CPO and the Fund will be operated in accordance with applicable CFTC regulations. Registration as a CPO imposes additional compliance obligations on the Sponsor and the Fund related to additional laws, regulations and enforcement policies, which could increase compliance costs and may affect the operations and financial performance of the Fund. For example, the Sponsor will be required to post certain documents on the Fund s website, make periodic filings with the NFA, retain certain records, and implement certain policies and procedures. The Fund is subject to risks associated with carbon emissions allowances and cap-and-trade regimes due to its investment in Carbon Credit Futures. There is no assurance that cap-and-trade regimes will continue to exist. Cap-and-trade regimes were designed to attempt to put a cap on pollution by putting a price on carbon emissions, but the approach may not prove to be an effective method of reducing GHG emissions and or in achieving climate change objectives. As a result or due to other factors, cap-and-trade regimes may be terminated or may not be renewed upon their expiration. New technologies may arise that may diminish or eliminate the need for cap-and-trade markets. Ultimately, the cost of emissions credits is determined by the cost of actually reducing emissions levels. If the price of credits becomes too high, it will be more economical for companies to develop or invest in green technologies, thereby suppressing the demand for credits and adversely affecting the Fund. Cap-and-trade regimes set emission limits (i.e., the right to emit a certain quantity of GHG emissions), which can be allocated or auctioned to the parties regulated under the regime up to the total emissions cap. This allocation may be larger or smaller than is needed for a stable price of credits and can lead to large price volatility and may impact the Fund. Depending upon the industries covered under the cap-and-trade regime, unpredictable demand for their products and services can affect the value of GHG emissions credits. For example, very mild winters or very cool summers can decrease demand for electric utilities and therefore require fewer carbon credits to offset reduced production and GHG emissions. If fines or other penalties for non-compliance are not enforced, incentives to purchase GHG credits will deteriorate, which could result in a decline in the price of emissions credits and may adversely impact the Fund. Climate change regulations may change, which could cause loss in value of the carbon underlying the Carbon Credit Futures and the Carbon Credit Futures itself. The Fund is subject to the risk that a change in law and related regulations will impact the way the Fund operates, increase the particular costs of the Fund s operations and/or change the competitive landscape. Additional legislative or regulatory changes could occur that may materially and adversely affect the Fund. Governments around the world are increasingly focused on enacting laws and regulations regarding climate change and regulation of GHGs. Lawmakers and regulators in the jurisdictions in the United States and Europe have proposed or enacted regulations requiring reporting of greenhouse gas emissions and the restriction thereof. In addition, efforts have been made and continue to be made in the international community toward the adoption of international treaties or protocols that would address global climate change issues and impose reductions of hydrocarbon-based fuels, and encouraging the implementation of net-zero GHG emission pledges. In recent years, the U.S. Congress has considered legislation to reduce emissions of GHGs and has included climate change considerations in its funding bills. For example, the Inflation Reduction Act of 2022, which appropriates significant federal funding for renewable energy initiatives, was signed into law in August 2022 and could accelerate the transition away from fossil fuels. In November 2021, the Biden Administration released "The Long-Term Strategy of the United States: Pathways to Net-Zero Greenhouse Gas Emissions by 2050," which establishes a roadmap to net zero emissions in the United States by 2050 through, among other things, improving energy efficiency, decarbonizing energy sources via electricity, hydrogen and sustainable biofuels, eliminating subsidies provided to the fossil fuel industry, reducing non-CO2 GHG emissions and increasing the emphasis on climate-related risks across government agencies and economic sectors. At the international level, the United States re-entered the United Nations-sponsored "Paris Agreement," a non-binding agreement for nations to limit their greenhouse gas emissions through individually determined reduction goals every five years after 2020, shortly after President Biden took office in February 2021. Then, in April 2021, President Biden announced a new, more rigorous nationally determined emissions reduction level of 50%-52% reduction from 2005 levels in economy-wide net GHG emissions by 2030. The international community has since gathered again in November 2021, November 2022, and December 2023 for the annual United Nations Climate Change Conference of the Parties, where the U.S., the European Union, and other partners announced reaffirmed their emissions reduction commitments and made further climate change goals. Most recently, the parties agreed to transition "away from fossil fuels in energy systems in a just, orderly and equitable manner" and increase renewable energy capacity so as to achieve net zero by 2050, although no timeline for doing so was set. The impacts of these orders, pledges, agreements and any legislation or regulation promulgated to fulfill the U.S. s commitments under the Paris Agreement or other international conventions cannot be predicted at this time. The proposed rules and initiatives addressing climate change described above are subject to intense political debate and their adoption or implementation will likely be impacted by the change in presidential administration resulting from the 2024 United States presidential election. Regulatory risk related to changes in regulation and enforcement of cap-and-trade regimes could adversely affect market behavior. In addition, as cap-and-trade markets and carbon credit markets develop, new regulation with respect to these markets may arise, which could have a negative effect on the value and liquidity of the cap-and-trade markets and the Fund. For example, regulatory changes to the CCM or VCM regimes to which the Carbon Credit Futures are tied, including changes to target emission levels, the emission sources and greenhouse gases covered by the regime, the allowance allocation system, the ability to "bank" allowances for or "borrow" allowances from a future year, and the types of offsets permitted to lower the overall costs of meeting the emission cap, among others, could impact the cost of reducing emissions levels and, as a result, the cost of emissions credits and may adversely impact the Fund. There is no assurance that CCM regimes will continue to exist. There is no assurance that CCM regimes will continue to exist. Cap-and-trade regimes were designed to attempt to put a cap on pollution by putting a price on carbon emissions, but the approach may not prove to be an effective method of reduction in GHG emissions and or in achieving climate change objectives. As a result or due to other factors, cap-and-trade regimes may be terminated or may not be renewed upon their expiration. New technologies may arise that may diminish or eliminate the need for CCMs. Ultimately, the cost of emissions credits is determined by the cost of actually reducing emissions levels. If the price of credits becomes too high, it will be more economical for companies to develop or invest in green technologies, thereby suppressing the demand for credits and adversely affect the Fund. Cap-and-trade regimes set emission limits (i.e., the right to emit a certain quantity of GHG emissions), which can be allocated or auctioned to the parties regulated under the regime up to the total emissions cap. This allocation may be larger or smaller than is needed for a stable price of credits and can lead to large price volatility and may impact the Fund. Depending upon the industries covered under the CCM regime, unpredictable demand for their products and services can affect the value of GHG emissions credits. For example, very mild winters or very cool summers can decrease demand for electric utilities and therefore require fewer carbon credits to offset reduced production and GHG emissions. If fines or other penalties for non-compliance are not enforced, incentives to purchase GHG credits will deteriorate, which could result in a decline in the price of emissions credits and may adversely impact the Fund. The Fund is also exposed to the risks of the underlying commodity, the carbon credits, linked to the Carbon Credit Futures. The value of a commodity-linked derivative investment typically is based upon the price movements of a physical commodity and may be affected by changes in overall market movements, volatility of an index, changes in interest rates, or factors affecting a particular industry or commodity, such as drought, floods, weather, embargoes, tariffs and international economic, political and regulatory developments. Investments in commodity-linked derivatives may be subject to greater volatility than non-derivative based investments. Commodity-linked derivatives also may be subject to credit and interest rate risks that in general affect the values of debt securities. The Fund is exposed to multiple geographic risks due to obtaining exposure to carbon markets in multiple geographic regions through its exposure to the Carbon Credit Futures that comprise the Index. The Fund s investments are expected to be in various countries or regions and, therefore the Fund may be susceptible to adverse market, political, regulatory, and geographic events affecting that country, countries or region. Such geographic focus also may subject the Fund to a higher degree of volatility than a more geographically diversified fund. European Union Risk. Because the Fund is exposed to carbon credits issued under the EU ETS cap-and-trade program, the Fund s performance may be negatively impacted by factors affecting the European Union. The economies of the European Union are dependent to a significant extent on those of certain key trading partners, including China, the United States, and other European countries. A reduction in spending on products and services exported from the European Union, or volatility in the financial markets of member countries, may have an adverse impact on the broader European Union economy and could adversely affect the Fund. Separately, the European Union faces issues involving its membership, structure, procedures and policies. The United Kingdom (UK) officially withdrew from the European Union on January 31, 2020. The UK, European Union and broader global economy may still experience volatility in foreign exchange markets as a result of these events. The UK s withdrawal may also destabilize some or all of the other European Union member countries and/or the Eurozone. The exit of additional member states from the European Union would subject its currency and banking system to increased risk and would likely result in increased volatility, illiquidity and potentially lower economic growth in the affected markets. Additionally, the reintroduction of national currencies in one or more European Union countries or the abandonment of the Euro as a currency could adversely affect the Fund. California Risk. Because the Fund is exposed to carbon credits issued under the CCA cap-and-trade program, the Fund s performance also may be negatively impacted by factors affecting California. For example, natural disasters may disrupt the local, state or regional economy or certain sectors of the economy and may impact the prices of such carbon credit futures. California s budget and fiscal operations face certain structural impediments and rely on revenue sources which have been historically sensitive to the economic environment. California s diverse economy is the largest in the United States and one of the largest in the world with major components including high technology, trade, entertainment, manufacturing, tourism, construction, agriculture and services. Any downturn in these sectors or related industries may adversely affect the economy of the state and the prices of such Carbon Credit Futures. Eastern U.S. Risk. Because the Fund is exposed to carbon credits issued under the RGGI cap-and-trade program, the Fund s performance also may be negatively impacted by factors affecting the Eastern region of the United States. For example, flooding, warming temperatures, and precipitation variability are growing challenges in the Eastern region of the United States and may disrupt the local, state, or regional economies of the Eastern states or certain sectors of those economies and may impact the prices of such carbon credit futures. The economies of the Eastern region of the United States are comprised of components including agriculture, tourism, professional services, and manufacturing. Any downturn in these sectors or related industries may adversely affect the economy of the Eastern region of the United States and the prices of such Carbon Credit Futures. The Fund may experience risks related to the energy, agriculture and metal sectors associated with its trading in carbon credit futures contracts. The market values of the companies in the energy, agriculture and metal sectors and industries are highly dependent on supply and demand resources, economic conditions, and technological advances among other factors. As a result, these sectors and industries can be volatile segments of the market. Companies in these sectors are also frequently subject to substantial regulation and may be subject to competitive or fixed pricing structures, which may increase the cost of business and limit potential earnings. Companies in these sectors also may have significant exposure to emerging markets or developing countries and, thus, be subject to a greater risk of expropriation, nationalization or other adverse governmental policies. The Fund may have a limited number of Futures Commission Merchants to buy and sell Carbon Credit Futures. The Fund may have a limited number of FCMs through which it may buy Carbon Credit Futures. Volatility in the carbon credit markets may lead to the Fund s FCMs to impose risk mitigation procedures that could limit the Fund s investment in Carbon Credit Futures beyond the accountability and position limits imposed. An FCM could impose a financial ceiling on initial margin that could change and become more or less restrictive on the Fund s activities depending upon a variety of conditions beyond the Sponsor s control. If the Fund s FCMs were to impose position limits, or if any other FCM with which the Fund establishes a relationship in the future were to impose position limits, the Fund s ability to meet its investment objective could be negatively impacted. The Fund will seek to monitor and manage its existing relationships with its FCMs and will seek additional relationships with FCMs as needed. The fragmented nature of data regarding the European Union carbon market and the lack of a centralized market monitoring of the European Union carbon market may make it more difficult to identify potential market manipulation and abusive practices. Due to the existing legal framework, data regarding the European Union carbon market is fragmented, with each available dataset having a specific scope regarding the counterparties and types of instruments covered. Additionally, while all EU ETS operations have been centralized into a single EU registry operated by the EU Commission (the "Union Registry") in 2012, there is no centralized market monitoring of the EU Carbon Market and is instead largely conducted by individual EU member states, namely Germany, Netherlands and Norway. As a result of this lack of centralized market monitoring of the EU carbon market at the EU level, tools to detect and deter fraudulent or manipulative trading activities (such as market manipulation, front-running of trades, and "wash-trading") may not be available to or employed by EUA markets or may not exist at all. As a result of reduced oversight, these schemes may be more prevalent in EUA markets than in the general market for financial products. The potential consequences of the EUA market s failure or failure to prevent market manipulation could adversely affect the value of the Shares. Any market abuse, and a loss of investor confidence in EUAs, may adversely impact pricing trends in EUA markets broadly, as well as an investment in Shares of the Fund. The Fund may experience a loss if it is required to sell cash equivalents at a price lower than the price at which they were acquired. If the Fund is required to sell its cash equivalents at a price lower than the price at which they were acquired, the Fund will experience a loss. This loss may adversely impact the price of the Shares and may decrease the correlation between the price of the Shares and the Index. The value of cash equivalents held by the Fund generally moves inversely with movements in interest rates. The prices of longer maturity securities are subject to greater market fluctuations as a result of changes in interest rates. While the short-term nature of the Fund s investments in cash equivalents should minimize the interest rate risk to which the Fund is subject, it is possible that the cash equivalents held by the Fund will decline in value. Certain of the Fund s investments could be illiquid, which could cause large losses to investors at any time. If the Fund s ability to obtain exposure to Carbon Credit Futures in accordance with its investment objective is disrupted for any reason including, because of limited liquidity or a disruption in the carbon credit futures market, or as a result of margin requirements or position limits imposed by the Fund s FCMs, exchanges, or the CFTC, the Fund may not be able to achieve its investment objective and may experience significant losses. Any disruption in the Fund s ability to obtain exposure to Carbon Credit Futures will cause the Fund s performance to deviate from the performance of Index. In addition, the Fund might grow to a size where a lack of liquidity in the futures market meant that the Fund could not sell enough futures contracts to honor redemption requests. Unexpected market illiquidity may cause major losses to investors at any time or from time to time. Because Carbon Credit Futures may be illiquid, the Fund s holdings may be more difficult to liquidate at favorable prices in periods of illiquid markets and losses may be incurred during the period in which positions are being liquidated. Risks Related to the Index The Fund seeks the investment performance of the Index and is accordingly subject to the risks associated therewith. The Fund is not actively managed; rather, the Fund seeks the investment performance of the Index through its investments in bitcoin and the Carbon Credit Futures that comprise the Index. The Fund seeks this exposure regardless of the investment merits associated with the assets. The Fund does not seek to outperform the returns of the Index. The Index has a limited operating history and may perform in unanticipated ways. The Index is new and has a limited performance history. There is no assurance that Kaiko and Solactive will compile the Index accurately, or that the Index will be determined, composed or calculated accurately. While Kaiko provides descriptions of what the Index is designed to achieve, neither Kaiko, Solactive nor either of its agents provide any warranty or accept any liability in relation to the quality, accuracy or completeness of the Index or its related data, and they do not guarantee that the Index will be in line with the methodology. The Sponsor does not provide any warranty or guarantee against the errors of Kaiko or Solactive or any agent thereof. Kaiko and/or Solactive could experience system failures or errors. If the computers or other facilities of Kaiko and/or Solactive, data providers and/or relevant stock exchange malfunction for any reason, calculation and dissemination of the Index may be delayed. Errors in Index data, the Index computations and/or construction may occur from time to time and may not be identified and/or corrected for a period of time or at all, which may have an adverse impact on the Fund and the Shareholders. Any of the foregoing may lead to the errors in the Index, which may lead to a different investment outcome for the Fund and its Shareholders than would have been the case had such events not occurred. Consequently, losses or costs associated with the Index s errors or other risks described above will generally be borne by the Fund and the Shareholders and neither the Sponsor nor its affiliates or agents make any representations or warranties regarding the foregoing. The Fund may not be successful in implementing its investment strategies to track the performance of the Index. Although the Fund will attempt to structure its portfolio so that investments track the Index, the Fund may not achieve the desired degree of correlation between its performance and that of the Index, and thus may not achieve its investment objective. The difference in performance may be due to factors such as fees, transaction costs, redemptions of, and subscriptions for, Shares, pricing differences or the cost to the Trust of complying with various new or existing regulatory requirements. Tracking error risk may be heightened in volatile markets or under other unusual market conditions. Risks related to pricing. The Fund s portfolio will be priced, including for purposes of determining NAV, based upon the estimated fair market value for bitcoin determined by Kaiko, as well as the price of the Carbon Credit Futures that comprise the Index. The price of bitcoin in U.S. Dollars or in other currencies available from other data sources may not be equal to the prices used to calculate the NAV. Kaiko Provider has substantial discretion at any time to change the methodology used to determine the estimated fair market value of bitcoin, including the spot markets underlying its methodology. Neither Kaiko nor Solactive is under any obligations to take the needs of the Fund, the Fund s Shareholders or anyone else into consideration in connection with such changes. The Index Pricing Sources (defined below) used by Kaiko are digital asset spot markets that facilitate the buying and selling of bitcoin and other digital assets. Although many Index Pricing Sources refer to themselves as "exchanges," they are not registered with, or supervised by, the SEC or CFTC and do not meet the regulatory standards of a national securities exchange or designated contract market. For these reasons, among others, purchases and sales of bitcoin may be subject to temporary distortions or other disruptions due to various factors, including the lack of liquidity in the markets and government regulation and intervention. These circumstances could affect the price of bitcoin determined by Kaiko. The NAV of the Fund will change as fluctuations occur in the market price of the Fund s bitcoin holdings and Carbon Credit Futures exposure. Shareholders should be aware that the public trading price per Share may be different from the NAV for a number of reasons, including price volatility, trading activity, the closing of bitcoin trading platforms due to fraud, failure, security breaches or otherwise, and the fact that supply and demand forces at work in the secondary trading market for Shares are related, but not identical, to the supply and demand forces influencing the market price of bitcoin. Shareholders also should note that the size of the Fund in terms of total bitcoin held may change substantially over time and as Creation Baskets are created and redeemed, even though such issuances and redemptions of Baskets will be effectuated in cash. In the event that the value of the Fund s bitcoin holdings and/or NAV is incorrectly calculated, neither the Sponsor nor the Administrator will be liable for any error and such misreporting of valuation data could adversely affect the value of the Shares. The Index price being used in calculating the price of bitcoin may not be consistent with GAAP. To the extent that the Fund s financial statements are determined using a different pricing source that is consistent with GAAP, the NAV reported in the Fund s periodic financial statements may differ, in some cases significantly, from the Fund s NAV determined using the Index pricing. The Fund will determine its NAV on each Business Day based on the value of bitcoin and Carbon Credit Futures represented in the portfolio. The methodology used to value bitcoin by the Index and by the Fund in its calculation of NAV may not be deemed consistent with GAAP. To the extent the methodology used to calculate bitcoin is deemed inconsistent with GAAP, the Fund will utilize an alternative GAAP-consistent pricing source for purposes of the Fund s periodic financial statements. Creation and redemption of Baskets, the Sponsor s management fee and other expenses borne by the Fund will be determined using the Fund s NAV determined daily in accordance with the Index s and Fund s pricing methodology. Such NAV of the Fund determined using this methodology may differ, and in some cases significantly, from the NAV reported in the Fund s periodic financial statements. Risks Related to the Fund and the Shares Shareholders do not have the protections associated with ownership of shares in an investment company registered under the Investment Company Act. The Investment Company Act is designed to protect investors by preventing insiders from managing investment companies to their benefit and to the detriment of public investors, such as: the issuance of securities having inequitable or discriminatory provisions; the management of investment companies by irresponsible persons; the use of unsound or misleading methods of computing earnings and asset value; changes in the character of investment companies without the consent of investors; and investment companies from engaging in excessive leveraging. To accomplish these ends, the Investment Company Act requires the safekeeping and proper valuation of fund assets, greatly restricts transactions with affiliates, limits leveraging, and imposes governance requirements as a check on fund management. The Fund is not registered as an investment company under the Investment Company Act and the Sponsor believes that the Fund is not required to register under such act. Consequently, Shareholders do not have the regulatory protections provided to investors in investment companies. The Fund is a passive investment vehicle. The Fund is not actively managed and will be affected by a general decline in the price of its assets. The Fund is a passive investment vehicle that does not seek to generate returns beyond tracking the value of the Index. The Sponsor does not actively manage the assets held by the Fund. This means the Sponsor does not speculatively sell assets at times when their prices are high, or acquire assets at low prices in the expectation of future price increases. It also means the Sponsor does not make use of any of the hedging techniques available to professional bitcoin investors to attempt to reduce the risks of losses resulting from price decreases. Any losses sustained by the Fund will adversely affect the value of your Shares. The amount of the Fund s assets represented by each Share will decline over time as the Fund pays the Management Fee and additional expenses borne by the Fund, and as a result, the value of the Shares may decrease over time. The amount of assets represented by each Share will decrease over the life of the Fund due to the Fund paying the Management Fee and other Fund expenses. Without increases in the price of bitcoin and/or Carbon Futures Credits sufficient to compensate for that decrease, the price of the Shares will also decline and you will lose money on your investment in Shares. Although the Sponsor has agreed to assume all organizational and certain ordinary administrative and marketing expenses incurred by the Fund, not all Fund expenses have been assumed by the Sponsor. For example, any taxes and other governmental charges that may be imposed on the Fund s property will not be paid by the Sponsor. The Fund also pays all transaction related fees and expenses charged in connection with trading activities for the Fund s investments and for maintenance of its CFTC regulatory status as a commodity pool. Because the Fund does not have any income, it needs to sell assets to cover the Management Fee and expenses not assumed by the Sponsor. The Fund may also be subject to other liabilities (for example, as a result of litigation) that have also not been assumed by the Sponsor. The only source of funds to cover those liabilities will be sales of bitcoin and Carbon Credit Futures held by the Fund. The result of these sales is a decrease in the amount of assets represented by each Share. New deposits of bitcoin and/or Carbon Credit Futures, received in exchange for new Shares issued by the Fund, do not reverse this trend. A decrease in the amount of bitcoin and/or exposure to Carbon Credit Futures represented by each Share results in a decrease in its price even if the price of bitcoin and/or Carbon Credit Futures has not changed. To retain the Share s original price, the price of the Fund s assets has to increase. Without that increase, the reduced amount of Fund assets represented by the Share will have a correspondingly lower price. If these increases do not occur, or are not sufficient to counter the lesser amount of Fund assets represented by each Share, you will sustain losses on your investment in Shares. An increase in the Fund expenses not assumed by the Sponsor, or the existence of unexpected liabilities affecting the Fund, will force the Sponsor to sell larger amounts of its assets, and will result in a more rapid decrease of the amount of assets represented by each Share and a corresponding decrease in its value. The Fund has a limited number of financial institutions that may act as Authorized Purchasers. The Fund has a limited number of financial institutions that may act as Authorized Purchasers. To the extent they cannot or are otherwise unwilling to engage in creation and redemption transactions with the Fund and no other Authorized Purchaser steps in, shares of the Fund may trade at a significant discount to NAV and may face delisting from the Exchange. There are certain risks and tax considerations due to the Fund s cash transactions for the creation and redemption processes. Like other ETFs, the Fund sells and redeems its shares only in large blocks called Creation Baskets and only to "Authorized Purchasers." Unlike many other ETFs, however, the Fund expects to effect its creations and redemptions fully for cash, rather than in-kind securities. Paying redemption proceeds in cash rather than through in-kind delivery of portfolio securities may require the Fund to dispose of or sell portfolio investments to obtain the cash needed to distribute redemption proceeds at an inopportune time, and the Fund may recognize taxable gain on such dispositions or sales. The use of cash creations and redemptions may adversely affect the arbitrage transactions by Authorized Purchasers intended to keep the price of the Shares closely linked to the Fund s NAV, and as a result, the price of Shares may fall or otherwise diverge from NAV. The use of cash creations and redemptions, as opposed to in-kind creations and redemptions, could cause delays in trade execution due to potential operational issues arising from implementing a cash creation and redemption model, which involves greater operational steps (and therefore execution risk) than the in-kind creation and redemption model. Such delays could cause the execution price associated with such trades to materially deviate from the Fund s NAV. Even though the Authorized Purchaser is responsible for the dollar cost of such difference in prices, Authorized Purchasers could default on their obligations to the Fund, or such potential risks and costs could lead to Authorized Purchasers, who would otherwise be willing to purchase or redeem Baskets to take advantage of any arbitrage opportunity arising from discrepancies between the price of the Shares and the price of the underlying Fund assets, to elect to not participate in the Fund s Share creation and redemption processes. This may adversely affect the arbitrage mechanism intended to keep the price of the Shares closely linked to the Fund s NAV, and as a result, the price of the Shares may fall or otherwise diverge from NAV. If the arbitrage mechanism is not effective, purchases or sales of Shares on the secondary market could occur at a premium or discount to NAV, which could harm Shareholders by causing them buy Shares at a price higher than the value of the underlying bitcoin held by the Fund or sell Shares at a price lower than the value of the Fund s assets, causing Shareholders to suffer losses. Alternatively, Authorized Purchasers could refrain from participating in creating and redeeming Baskets, and if not replaced, could disrupt the Fund s ability to operate. There is a risk of stale pricing when the markets in which the Fund s investments trade are closed. Because certain of the Fund s investments trade in markets that are closed when the Fund and Exchange are open, there are likely to be deviations between current pricing of an underlying security and stale pricing, resulting in the Fund trading at a discount or premium to NAV greater than those incurred by other ETFs. The Fund is new and investing in the Fund s Shares may have more risks than an investment in an established, larger fund. The Fund is new and does not yet have shares outstanding. If the Fund does not grow large in size once it commences trading, it will be at greater risk than larger funds of wider bid-ask spreads for its shares, trading at a greater premium or discount to NAV, liquidation and/or a stop to trading. There may be times when the market price of the Fund s Shares is more than the NAV intra-day (at a premium) or less than the NAV intra-day (at a discount). As a result, the Fund s Shareholders may pay more than NAV when purchasing shares and receive less than NAV when selling Fund Shares. There may be times when the market price of the Fund s Shares is more than the NAV intra-day (at a premium) or less than the NAV intra-day (at a discount). As a result, the Fund s Shareholders may pay more than NAV when purchasing shares and receive less than NAV when selling Fund Shares. This risk is heightened in times of market volatility or periods of steep market declines. In such market conditions, market or stop loss orders to sell Fund Shares may be executed at prices well below NAV. Secondary market trading is subject to bid-ask spreads and trading in Fund Shares may be halted by the Exchange because of market conditions or other reasons. Investors buying or selling shares in the secondary market will normally pay brokerage commissions, which are often a fixed amount and may be a significant proportional cost for investors buying or selling relatively small amounts of shares. Secondary market trading is subject to bid-ask spreads and trading in Fund Shares may be halted by the Exchange because of market conditions or other reasons. If a trading halt occurs, a shareholder may temporarily be unable to purchase or sell Shares of the Fund. In addition, although the Fund s Shares are listed on the Exchange, there can be no assurance that an active trading market for shares will develop or be maintained or that the Fund s shares will continue to be listed. As the Sponsor and its management have limited history of operating investment vehicles like the Fund, their experience may be inadequate or unsuitable to manage the Fund. The past performances of the Sponsor s management in other investment vehicles are no indication of their ability to manage an investment vehicle such as the Fund. If the experience of the Sponsor and its management is inadequate or unsuitable to manage an investment vehicle such as the Fund, the operations of the Fund may be adversely affected. Furthermore, the Sponsor is currently engaged in the management of other investment vehicles which could divert their attention and resources. If the Sponsor were to experience difficulties in the management of such other investment vehicles that damaged the Sponsor or its reputation, it could have an adverse impact on the Sponsor s ability to continue to serve as Sponsor for the Fund. Investors cannot be assured of the Sponsor s continued services, the discontinuance of which may be detrimental to the Fund. Investors cannot be assured that the Sponsor will be able to continue to service the Fund for any length of time. If the Sponsor discontinues its activities on behalf of the Fund, the Fund may be adversely affected, as there may be no entity servicing the Fund for a period of time, and it will not have a CPO and CTA. If the Sponsor s registrations with the CFTC or memberships in the NFA were revoked or suspended, the Sponsor, as applicable, would no longer be able to provide services and/or to render advice to the Fund. If the Sponsor were unable to provide services and/or advice to the Fund, the Fund would be unable to pursue its investment objectives unless and until the Sponsor s ability to provide services and advice to the Fund was reinstated or a replacement for the Sponsor CPO or CTA, could be found. Such an event could result in termination of the Fund. The value of the Shares could decrease if unanticipated operational or trading problems arise. The mechanisms and procedures governing the creation, redemption and offering of the Shares and storage of the Fund s bitcoin has been developed specifically for this product offering. There may be unanticipated problems or issues with respect to the mechanics of the Fund s operations and the trading of the Shares that could have an adverse effect on an investment in the Shares. In addition, although the Fund is not actively "managed" by traditional methods, to the extent that unanticipated operational or trading problems or issues arise, the Sponsor s past experience and qualifications may not be suitable for solving these problems or issues. If the processes of creation and redemption of Baskets encounter any unanticipated difficulties, the opportunities for arbitrage transactions intended to keep the price of the Shares closely linked to the Fund s NAV may not exist and, as a result, the price of the Shares may fall. If the creation and redemption of the Shares encounter any unanticipated difficulties, including, but not limited to, the Fund s inability in the future to obtain regulatory approvals for the offer and sale of additional Shares after the present offering is completed, potential market participants who would otherwise be willing to purchase or redeem Baskets to take advantage of any arbitrage opportunity arising from discrepancies between the price of the Shares and the price of the underlying assets may not take the risk that, as a result of those difficulties, they may not be able to realize the profit they expect. If this is the case, the liquidity of Shares and price of Shares may decline independent of the NAV of Shares. The postponement, suspension or rejection of creation or redemption orders may adversely affect an investment in the Shares. Under the Trust Agreement, the Sponsor may suspend or reject creation or redemption orders, as applicable, for a variety of permitted reasons under certain circumstances. To the extent such orders are suspended or rejected, the arbitrage mechanism resulting from the process through which Authorized Purchasers create and redeem Shares directly with the Fund may fail to closely link the price of the Shares to the price of the underlying products in the relevant commodities markets, as measured using the Bitcoin Price. If this is the case, the liquidity of the Shares may decline and the price of the Shares may fluctuate independently of the value of the investments which comprise the Index and may fall. The Fund could experience unforeseen difficulties in operating and maintaining key elements of its technical infrastructure. The Bitcoin Account has been designed specifically to provide security for the bitcoin portion of the Fund s assets, and may be expanded, updated and altered from time to time. Any effort to expand, update or alter the security system is likely to be complex, and unanticipated delays in the completion of these projects may lead to unanticipated project costs, operational inefficiencies or vulnerabilities to security breaches. In addition, there may be problems with the design or implementation of the Bitcoin Account or with an expansion or upgrade thereto that are not evident during the testing phases of design and implementation, and that may only become apparent after the Fund has utilized the infrastructure. Any issues relating to the performance and effectiveness of the security procedures used by the Fund and the Bitcoin Custodian to protect the Bitcoin Account, such as algorithms, codes, passwords, multiple signature systems, encryption and telephone call-backs (together, the "Security Procedures"), may have an adverse impact on an investment in the Shares. The Security Procedures implemented by the Bitcoin Custodian are technical and complex, and the Fund depends on the Security Procedures to protect the storage, acceptance and distribution of data relating to bitcoin and the digital wallets into which the Fund deposits its assets. The Security Procedures may not protect against all errors, software flaws (i.e., bugs) or vulnerabilities. Defects in the Security Procedures may only be discovered after a failure in the Bitcoin Custodian s safekeeping and storage of the bitcoin portion of the Fund s assets. It is not uncommon for businesses in the bitcoin space to experience large losses due to fraud and breaches of their security systems. For example, in September 2015, the global bitcoin payment agent, BitPay, lost approximately $1.8 million of bitcoin due to a hacker s fraudulent impersonation of BitPay s CFO, whereby the hacker was able to access the CFO s email account and successfully request BitPay s custodian to transfer funds. The Fund s and the Bitcoin Custodian s ability to adopt technology in response to changing security needs or trends poses a challenge to the safekeeping of the bitcoin portion of the Fund s assets. Digital asset trading platforms and large holders of bitcoin must adapt to technological change in order to secure and safeguard client accounts. While the Sponsor believes the Security Procedures in place have been reasonably designed to safeguard the Fund s assets from theft, loss, destruction or other issues relating to hackers and technological attack, such assessment is based upon known technology and threats. As technological change occurs, the security threats to the Fund s bitcoin will likely adapt and previously unknown threats may emerge. Furthermore, the Sponsor believes that the Fund may become a more appealing target of security threats as the size of the Fund s assets grows. To the extent that the Fund or the Bitcoin Custodian is unable to identify and mitigate or stop new security threats, the Fund s assets may be subject to theft, loss, destruction or other attack, which could have a negative impact on the performance of the Shares or result in loss of the Fund s assets. Security threats to the Bitcoin Account could result in the halting of Fund operations, the suspension of redemptions, and a loss of Fund assets or damage to the reputation of the Fund, each of which could result in a reduction in the portion of the Shares value that is tied to bitcoin. Security breaches, computer malware and computer hacking attacks have been a prevalent concern in the Bitcoin Platform Market since the launch of the Bitcoin Network. Any security breach caused by hacking, which involves efforts to gain unauthorized access to information or systems, or to cause intentional malfunctions or loss or corruption of data, software, hardware or other computer equipment, and the inadvertent transmission of computer viruses, could harm the Fund s business operations or result in loss of the Fund s assets. Any breach of the Fund s infrastructure could result in damage to the Fund s reputation and reduce demand for the Shares, resulting in a reduction in the price of the Shares. Furthermore, the Sponsor believes that, as the bitcoin portion of the Fund s assets grow, it may become a more appealing target for security threats such as hackers and malware. The Sponsor believes that the Security Procedures that the Sponsor and Bitcoin Custodian utilize are reasonably designed to safeguard the Fund s assets from theft, loss, destruction or other issues relating to hackers and technological attack. Nevertheless, the Security Procedures cannot guarantee the prevention of any loss due to a security breach, software defect or act of God that may be borne by the Fund, absent gross negligence, willful misconduct or bad faith on the part of the Sponsor, the Bitcoin Custodian or their respective agents. The Security Procedures and operational infrastructure may be breached due to the actions of outside parties, error or malfeasance of an employee of the Sponsor or the Bitcoin Custodian, or otherwise, and, as a result, an unauthorized party may obtain access to the Bitcoin Account, private keys, data or assets. Additionally, outside parties may attempt to fraudulently induce employees of the Bitcoin Custodian or the Sponsor to disclose sensitive information in order to gain access to the Fund s infrastructure. As the techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently, or may be designed to remain dormant until a predetermined event and often are not recognized until launched against a target, the Sponsor may be unable to anticipate these techniques or implement adequate preventative measures. If an actual or perceived breach of the Bitcoin Account occurs, the market perception of the effectiveness of the Fund could be harmed, which could result in a reduction in the portion of the Shares value that is tied to bitcoin. In the event of a security breach of the Bitcoin Account, the Fund may cease operations, suspend redemptions or suffer a reduction in assets, the occurrence of each of which could result in a reduction in the portion of the Shares value that is tied to bitcoin. A loss of confidence or breach in the Fund s security and technology policies may adversely affect the Fund and the value of an investment in the Shares. The Fund, Sponsor, Bitcoin Custodian and each of their respective agents will take measures to protect the Fund and its assets from unauthorized access, damage or theft. However, it is possible that the Security Procedures in place may not prevent the improper access to, or damage or theft of the Fund s assets. A security breach could harm the Fund s reputation or result in the loss of some or all of the Fund s assets. A resulting perception that the Security Procedures do not adequately protect the Fund s assets could result in a loss of current or potential Shareholders, reducing demand for, and price of, the Shares. The Fund s assets may be subject to loss, damage, theft or restriction on access. There is a risk that some or all of the Fund s assets could be lost, stolen or destroyed. The Sponsor believes that the Fund s assets held in the Bitcoin Account will be an appealing target to hackers or malware distributors seeking to destroy, damage or steal the Fund s assets. Although the Bitcoin Custodian uses Security Procedures with various elements, neither the Bitcoin Custodian nor the Sponsor can guarantee the prevention of such loss, damage or theft, whether caused intentionally, accidentally or by an act of God. Access to the Fund s assets could also be restricted by natural events (such as an earthquake or flood) or human actions (such as a terrorist attack). Any of these events may adversely affect the operations of the Fund and, consequently, an investment in the Shares. The Shareholders limited rights of legal recourse against the Fund, Trustee, Sponsor, Transfer Agent, Kaiko, Solactive and Custodians expose the Fund and its Shareholders to the risk of loss of the Fund s assets for which no person is liable. Shareholders recourse against the Fund, Trustee, Custodians and Sponsor under New York law or Minnesota law, as applicable, governing their custody operations is limited. Similarly, the Shareholders recourse against the Sponsor, the Transfer Agent, Kaiko and Solactive for the services they provide to the Fund, including those relating to the provision of instructions relating to the movement of bitcoin, is limited. Consequently, a loss may be suffered with respect to the Fund s assets for which no person is liable in damages. Further, there is no third-party insurance to cover any loss that may be suffered with respect to the Fund s assets. Assets held by the Fund are not subject to FDIC or SIPC protections. The Fund is not a banking institution or otherwise a member of the Federal Deposit Insurance Corporation ("FDIC") or Securities Investor Protection Corporation ("SIPC") and, therefore, deposits held with or assets held by the Fund are not subject to the protections enjoyed by depositors with FDIC or SIPC member institutions. The undivided interests in the Fund s assets represented by Shares in the Fund are not insured directly by the Trustee or the Sponsor. The Custodians limited liability under the respective Bitcoin Custody Agreement or Non-Digital Custody Agreement may impair the ability of the Fund to recover losses relating to its assets and any recovery may be limited, even in the event of fraud, to the market value of the assets at the time the fraud is discovered. Under the respective Bitcoin Custody Agreement and the Non-Digital Custody Agreement, the respective custodian s liability is limited to the greater of (i) the market value of the Fund s assets at the time the events giving rise to the liability occurred and (ii) the fair market value of the Fund s assets at the time that the custodian notifies the Sponsor or Trustee in writing, or the Sponsor or the Trustee otherwise has actual knowledge of the events giving rise to the liability. In addition, the Bitcoin Custodian and Non-Digital Custodian will not be liable for any delay in performance or any non-performance of any of its custodial obligations under the Trust Agreement by reason of any cause beyond its reasonable control, including acts of God, war or terrorism. The Bitcoin Custodian and Non-Digital Custodian will also not be liable for any system failure or third-party penetration of the Fund s accounts, unless such system failure or third-party penetration is the result of gross negligence, bad faith or willful misconduct on the part of the Bitcoin Custodian or Non-Digital Custodian. As a result, the recourse of the Fund or the Shareholder, under New York law or Minnesota law, as applicable, may be limited. The Fund may not have adequate sources of recovery if its assets are lost, stolen or destroyed. If the Fund s assets are lost, stolen or destroyed under circumstances rendering a party liable to the Fund, the responsible party may not have the financial resources sufficient to satisfy the Fund s claim. For example, as to a particular event of loss, the only source of recovery for the Fund might be limited to the applicable Bitcoin Custodian or Non-Digital Custodian or, to the extent identifiable, other responsible third parties (for example, a thief or terrorist), any of which may not have the financial resources (including liability insurance coverage) to satisfy a valid claim of the Fund. The liquidity of the Shares may be affected if Authorized Purchasers cease to perform their obligations under the Authorized Purchaser Agreements. In the event that one or more Authorized Purchasers having substantial interests in Shares or otherwise responsible for a significant portion of the Shares daily trading volume on the Exchange terminates its Authorized Purchaser Agreement, the liquidity of the Shares would likely decrease, which could adversely affect the market price of, and an investment in, the Shares. There is no guarantee that an active trading market for the Shares will develop. To the extent that no active trading market develops and the assets of the Trust do not reach a viable size, the liquidity of the Shares may be limited or the Trust may be terminated at the option of the Sponsor. There can be no assurance an active trading market of the Shares will develop on the Exchange. The Sponsor may elect to terminate the Fund if it determines, in its sole discretion, that the Fund is not an economically viable size, which could result in the liquidation of the Fund s assets at a time that is disadvantageous to Shareholders. If the Fund fails to achieve sufficient scale due to competition, the Sponsor may have difficulty raising sufficient revenue to cover the costs associated with launching and maintaining the Fund, and such shortfalls could impact the Sponsor s ability to properly invest in robust ongoing operations and controls of the Fund to minimize the risk of operating events, errors, or other forms of losses to the Shareholders. To the extent that the Exchange halts trading in the Shares, whether on a temporary or permanent basis, investors may not be able to buy or sell Shares, thus adversely affecting an investment in the Shares. If an active trading market for the Shares does not exist or continue to exist, the market prices and liquidity of the Shares may be adversely affected. In addition, the Fund may also fail to attract adequate liquidity in the secondary market due to such competition, resulting in a sub-standard number of Authorized Purchasers willing to make a market in the Shares, which in turn could result in a significant premium or discount in the Shares for extended periods and the Fund s failure to achieve its investment objective. The Fund may be required to terminate and liquidate at a time that is disadvantageous to Shareholders. If the Fund is required to terminate and liquidate, such termination and liquidation could occur at a time that is disadvantageous to Shareholders, such as when the value of the investments that comprise the Index is lower than it was at the time when Shareholders purchased their Shares. In such a case, the resulting proceeds distributed to Shareholders will be less than if the value of the investments that comprise the Index were higher at the time of sale. See "Additional Information About the Trust—Description of the Trust Agreement—Termination of the Trust" for more information about the termination of the Fund, including when the termination of the Fund may be triggered by events outside the direct control of the Sponsor, the Trustee or the Shareholders. The Trust Agreement includes a provision that restricts the right of a beneficial owner of a statutory trust from bringing a derivative action. Under Delaware law, the right of a beneficial owner of a statutory trust (such as a Shareholder of the Fund) to bring a derivative action (i.e., to initiate a lawsuit in the name of a the statutory trust in order to assert a claim belonging to the statutory trust against a fiduciary of the statutory trust or against a third-party when the statutory trust s management has refused to do so) may be restricted by the terms of the governing instrument of the statutory trust. The Trust Agreement provides that in addition to any other requirements of applicable law, no Shareholder shall have the right, power or authority to bring or maintain a derivative action, suit or other proceeding on behalf of the Fund unless two or more Shareholders who (i) are not affiliates of one another and (ii) collectively hold at least 10% of the outstanding Shares join in the bringing or maintaining of such action, suit or other proceeding. Therefore, the Trust Agreement limits the likelihood that a Shareholder could successfully assert a derivative action. The Administrator is responsible for determining the value of the Fund s assets, and any errors, discontinuance or changes in such valuation calculations may have an adverse effect on the value of the Shares. The Administrator will determine the Fund s NAV and NAV per Share on a daily basis as soon as practicable after 4:00 p.m. Eastern Time on each business day. The Administrator s determination is made utilizing data from the Non-Digital Custodian operations and the value of bitcoin as determined by the Index, calculated at 4:00 p.m. Eastern Time on such day. To the extent that the Fund s NAV or NAV per Share are incorrectly calculated, the Administrator may not be liable for any error and such misreporting of valuation data could adversely affect an investment in the Shares. If the Fund incurs extraordinary expenses in U.S. Dollars, the Fund will sell bitcoins and Carbon Credit Futures to pay these expenses. The sale of the Fund s bitcoins and Carbon Credit Futures to pay expenses at a time of low bitcoin prices or low Carbon Credit Future prices could adversely affect the value of the Shares. The Sponsor will sell bitcoins and/or exposure to Carbon Credit Futures held by the Fund to pay Fund expenses not assumed by the Sponsor on an as-needed basis, irrespective of then-current prices. The Fund is not actively managed and no attempt will be made to protect against or to take advantage of fluctuations in the price of bitcoins and/or Carbon Credit Futures. Consequently, if the Fund incurs expenses in U.S. Dollars, the Fund s bitcoins and exposure to Carbon Credit Futures may be sold at a time when bitcoin prices and/or Carbon Credit Future prices are low, resulting in a negative impact on the value of the Shares. Intellectual property rights claims may adversely affect the Fund and an investment in the Shares. The Sponsor is not aware of any intellectual property rights claims that may prevent the Fund from operating and holding bitcoins and/or carbon credit futures; however, third parties may assert intellectual property rights claims relating to the operation of the Fund and the mechanics instituted for the investment in carbon credit futures contracts and the investment in, holding of and transfer of bitcoins. Regardless of the merit of an intellectual property or other legal action, any legal expenses to defend or payments to settle such claims would be Additional Fund Expenses and be borne by the Fund. Additionally, a meritorious intellectual property rights claim could prevent the Fund from operating and force the Sponsor to terminate the Fund and liquidate the Fund s assets. As a result, an intellectual property rights claim against the Fund could adversely affect an investment in the Shares. The Fund is an "emerging growth company" and it cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make the Shares less attractive to investors. The Fund is an "emerging growth company" as defined in the JOBS Act. For as long as the Fund continues to be an emerging growth company it may choose to take advantage of certain exemptions from various reporting requirements applicable to other public companies but not to emerging public companies, which include, among other things: exemption from the auditor attestation requirements under Section 404(b) of the Sarbanes-Oxley Act; reduced disclosure obligations regarding executive compensation in the Fund s periodic reports and audited financial statements in this prospectus; exemptions from the requirements of holding advisory "say-on-pay" votes on executive compensation and shareholder advisory votes on "golden parachute" compensation; and exemption from any rules requiring mandatory audit firm rotation and auditor discussion and analysis and, unless otherwise determined by the SEC, any new audit rules adopted by the Public Company Accounting Oversight Board. The Fund could be an emerging growth company until the last day of the fiscal year following the fifth anniversary after its initial public offering, or until the earliest of (1) the last day of the fiscal year in which it has annual gross revenue of $1.235 billion or more, (2) the date on which it has, during the previous three year period, issued more than $1 billion in non-convertible debt or (3) the date on which it is deemed to be a large accelerated filer under the federal securities laws. The Fund will qualify as a large accelerated filer as of the first day of the first fiscal year after it has (A) more than $700 million in outstanding equity held by nonaffiliates, (B) been public for at least 12 months and (C) filed at least one annual report on Form 10-K. Under the JOBS Act, emerging growth companies are also permitted to elect to delay adoption of new or revised accounting standards until companies that are not subject to periodic reporting obligations are required to comply, if such accounting standards apply to non-reporting companies. However, the Fund has chosen to opt out of this extended transition period for complying with new or revised accounting standards. Section 107 of the JOBS Act provides that the decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable. The Fund cannot predict if investors will find an investment in the Fund less attractive if it relies on these exemptions. If regulatory changes or interpretations of an Authorized Purchaser s activities require the regulation of an Authorized Purchaser as a money service business under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act or as a money transmitter or virtual currency business under state regimes for the licensing of such businesses, an Authorized Purchaser may be required to register and comply with such regulations, which could result in extraordinary, recurring and/or nonrecurring expenses to the Authorized Purchaser or increased commissions for the Authorized Purchaser s clients, thereby reducing the liquidity of the Fund. To the extent that the activities of an Authorized Purchaser cause it to be deemed a "money services business" under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act, an Authorized Purchaser may be required to comply with FinCEN regulations, including those that would mandate an Authorized Purchaser to implement AML programs, make certain reports to FinCEN and maintain certain records. Similarly, the activities of an Authorized Purchaser may require it to be licensed as a money transmitter or as a virtual currency business, such as under NYDFS s BitLicense scheme. Such additional regulatory obligations may cause the Authorized Purchaser to incur extraordinary expenses, possibly increasing the levels of the commissions that an Authorized Purchaser charges its clients in a material and adverse manner. If an Authorized Purchaser determines not to comply with such additional regulatory and registration requirements, an Authorized Purchaser may terminate its role as an Authorized Purchaser of the Fund. Such a termination may decrease the liquidity of the Fund. Additionally, to the extent an Authorized Purchaser is found to have operated without appropriate state or federal licenses, it may be subject to investigation, administrative or court proceedings, and civil or criminal monetary fines and penalties, all of which would harm the reputation of the Fund or its Sponsor, decrease the liquidity of the Fund, and have a material adverse effect on the price of the Shares. Banks may not provide banking services, or may cut off banking services, to businesses that provide bitcoin-related services or that accept bitcoin as payment, which could damage the public perception of bitcoin and the utility of bitcoin as a payment system and could decrease the price of bitcoin and adversely affect the portion of the Shares value that is tied to bitcoin. A number of companies that provide bitcoin-related services have been unable to find banks that are willing to provide them with bank accounts and banking services. Similarly, a number of such companies have had their existing bank accounts closed by their banks. Banks may refuse to provide bank accounts and other banking services to bitcoin-related companies or companies that accept bitcoin for a number of reasons, such as perceived compliance risks or costs. The difficulty that many businesses that provide bitcoin-related services have and may continue to have in finding banks willing to provide them with bank accounts and other banking services may be currently decreasing the usefulness of bitcoin as a payment system and harming public perception of bitcoin or could decrease its usefulness and harm its public perception in the future. Similarly, the usefulness of bitcoin as a payment system and the public perception of bitcoin could be damaged if banks were to close the accounts of many or of a few key businesses providing bitcoin-related services. This could decrease the price of bitcoins and therefore adversely affect the portion of the Shares value that is tied to bitcoin. It may be illegal now, or in the future, to acquire, own, hold, sell or use bitcoins in one or more countries, and ownership of, holding or trading in Shares may also be considered illegal and subject to sanctions. The U.S., China, Russia or other jurisdictions may take regulatory actions in the future that severely restrict the right to acquire, own, hold, sell or use bitcoins or to exchange bitcoins for fiat currency. Such an action may also result in the restriction of ownership, holding or trading in the Shares due to their bitcoin component. Such a restriction could subject the Fund or its Sponsor to investigations, civil or criminal fines and penalties, which could harm the reputation of the Fund or its Sponsor and could result in the termination and liquidation of the Fund at a time that is disadvantageous to Shareholders or may adversely affect an investment in the Shares. If regulatory changes or interpretations of the Fund s or Sponsor s activities require registration as money service businesses under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act or as money transmitters or digital currency businesses under state regimes for the licensing of such businesses, the Fund and/or Sponsor could suffer reputational harm and also extraordinary, recurring and/or nonrecurring expenses, which would adversely impact an investment in the Shares. If regulatory changes or interpretations of the Fund s or Sponsor s activities require the registration of the Fund or Sponsor as a money services business under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act, the Fund or Sponsor may be required to register and comply with such regulations. If regulatory changes or interpretations of the Fund s or Sponsor s activities require the licensing or other registration as a money transmitter or business engaged in digital currency activity (e.g., under the New York BitLicense regime) (or equivalent designation) under state law in any state in which the Fund or Sponsor operates, the Fund or Sponsor may be required to seek licensure or otherwise register and comply with such state law. In the event of any such requirement, to the extent that the Sponsor decides to continue the Fund, the required registrations, licensure and regulatory compliance steps may result in extraordinary, nonrecurring expenses to the Fund. Regulatory compliance would include, among other things, implementing AML and consumer protection programs. The Sponsor may also decide to terminate the Fund. Any termination of the Fund in response to the changed regulatory circumstances may be at a time that is disadvantageous to Shareholders. To the extent the Fund or its Sponsor is found to have operated without appropriate state or federal licenses, it may be subject to investigation, administrative or court proceedings, and civil or criminal monetary fines and penalties, all of which would harm the reputation of the Fund or its Sponsor, decrease the liquidity of the Fund, and have a material adverse effect on the price of the Shares. If the Sponsor decides to comply with such additional federal or state regulatory obligations and continue the Fund, the required registrations, licensure and regulatory compliance steps may result in extraordinary, nonrecurring expenses to the Fund, possibly affecting an investment in the Shares in a material and adverse manner. Furthermore, the Fund and its service providers may not be capable of complying with certain federal or state regulatory obligations applicable to money service businesses money transmitters and businesses involved in digital currency business activity. If the Sponsor determines not to comply with such requirements, the Sponsor will act to dissolve and liquidate the Fund. Any such termination could result in the liquidation of the Fund s bitcoins at a time that is disadvantageous to Shareholders. The classification of the Fund as a corporation for U.S. federal income tax purposes is relatively uncommon. The Fund is classified as a corporation for U.S. federal income tax purposes. This differs from many investment companies, which elect to be treated as "regulated investment companies" under the Code in order to avoid U.S. federal income tax obligations at the entity level. Under current law, the Fund is not eligible to elect treatment as a regulated investment company because the Fund s investments consist primarily of bitcoin. As a result, the Fund will be obligated to pay applicable U.S. federal and state corporate income taxes on its taxable income unlike other investment companies which are not so obligated. The U.S. federal income tax treatment of transactions in digital assets is unclear. Due to the new and evolving nature of digital assets and the absence of comprehensive guidance with respect to digital assets, many significant aspects of the U.S. federal income tax treatment of digital assets such as bitcoin are uncertain. Our dealings in or in connection with digital assets, as well as transactions in digital assets generally, could be subject to adverse tax consequences in the U.S., including as a result of development of the legal regimes surrounding digital assets, and our operating results, as well as the price of digital assets, could be adversely affected thereby. Many significant aspects of the U.S. federal income tax treatment of digital assets (including with respect to the amount, timing and character of income recognition) are uncertain. In 2014, the IRS released a notice (the "Notice") discussing certain aspects of digital assets for U.S. federal income tax purposes and, in particular, providing that such digital assets (1) are "property," (2) are not "currency" for purposes of the rules relating to foreign currency gain or loss and (3) may be held as a capital asset. In 2019, the IRS released a revenue ruling and a set of "Frequently Asked Questions" (the "Ruling & FAQs") that provide some additional guidance, including guidance to the effect that, under certain circumstances, hard forks of digital assets are taxable events giving rise to ordinary income and guidance with respect to the determination of the tax basis of digital assets. The Notice and the Ruling & FAQs, however, do not address other significant aspects of the U.S. federal income tax treatment of digital assets. We do not intend to request a ruling from the IRS on these or any other issues, and we will take positions on these and other U.S. federal income tax issues relating to digital assets that we believe to be reasonable. There can be no assurance that the IRS will agree with the positions we take, and it is possible that the IRS will successfully challenge our positions. There can be no assurance that the IRS will not alter its position with respect to digital assets in the future or that a court would uphold the treatment set forth in the Notice and the Ruling & FAQs. It is also unclear what additional guidance on the treatment of digital assets for U.S. federal income tax purposes may be issued in the future. Any such alteration of the current IRS positions or additional guidance could result in adverse tax consequences for us and could have an adverse effect on the value of bitcoin or other digital assets. Because of the evolving nature of digital assets, it is not possible to predict potential future developments that may arise with respect to digital assets. Such developments may increase the uncertainty with respect to the treatment of digital assets for U.S. federal income tax purposes. For example, the Notice addresses only digital assets that are "convertible virtual currency," and it is conceivable that we will hold certain types of digital assets that are not within the scope of the Notice. On November 15, 2021, President Biden signed the Infrastructure Investment and Jobs Act (the "IIJA") into law. The IIJA implements a set of comprehensive financial account information reporting rules that will apply to persons, including digital asset trading platforms and custodians, that regularly effect transfers of digital assets on behalf of other persons. In particular, these rules will require digital asset trading platforms and custodians to report digital asset transactions (including sales, exchanges and other transfers) effected on behalf of other persons on an annual return, in a manner similar to the current reporting rules for brokers that effect stock and other securities transactions on behalf of customers. The IRS issued proposed regulations on these rules on August 28, 2023. Under the proposed regulations the gross proceeds of sales or exchanges of digital assets must be reported for transactions that take place on or after January 1, 2025, and, in certain circumstances, gain or loss with respect to such sales or exchanges must be reported for transactions that take place on or after January 1, 2026. These rules, the effects of which may depend in significant part on regulations or other guidance from the IRS on their implementation, could create significant compliance burdens for us and our investors, and could affect the price of digital assets, which could have an adverse effect on our investments. In addition, the Sponsor has committed to cause the Fund to irrevocably abandon any Incidental Rights and IR Virtual Currency to which the Fund may become entitled in the future. However, there can be no assurance that these abandonments would be treated as effective for U.S. federal income tax purposes, or that the Sponsor will continue to cause the Fund to irrevocably abandon any Incidental Rights and IR Virtual Currency if there are any future regulatory developments that would make it feasible for the Fund to retain those assets. The state, local and non-U.S. tax treatment of digital assets is unclear. The taxing authorities of certain states (i) have announced that they will follow the Notice with respect to the treatment of digital assets for state income tax purposes and/or (ii) have issued guidance exempting the purchase and/or sale of digital assets for fiat currency from state sales tax. It is unclear what further guidance on the treatment of digital assets for state tax purposes may be issued in the future. Any future guidance on the treatment of digital assets for state or local tax purposes could result in adverse tax consequences to us and could adversely affect the price of digital assets. The treatment of digital assets for tax purposes by non-U.S. jurisdictions may differ from the treatment of digital currency for U.S. federal, state or local tax purposes. It is possible, for example, that a non-U.S. jurisdiction would impose sales tax or value-added tax on purchases and sales of digital assets for fiat assets. For instance, if a foreign jurisdiction with a significant share of the market of bitcoin users imposes onerous tax burdens on digital asset users or imposes sales or value-added tax on purchases and sales of digital assets for fiat assets, such actions could result in decreased demand for digital currency in such jurisdiction, which could adversely affect the price of digital assets. Each potential investor is urged to consult his, her or its own tax advisor regarding the tax treatment of digital assets and the tax consequences of investing in the Fund. Risks Related to Potential Conflicts of Interest Potential conflicts of interest may arise among the Sponsor or its affiliates and the Fund. The Trust Agreement modifies and restricts the default fiduciary duties under the DSTA, which may permit them under state law to favor their own interests to the detriment of the Fund and its Shareholders. That notwithstanding, the Sponsor is a registered investment adviser under the Advisers Act and is subject to fiduciary duties therewith. The Sponsor will manage the business and affairs of the Fund. Conflicts of interest may arise among the Sponsor and its affiliates, on the one hand, and the Fund and its Shareholders, on the other hand. As a result of these conflicts, the Sponsor may favor its own interests and the interests of its affiliates over the Fund and its Shareholders. These potential conflicts include, among others, the following: The Sponsor s default fiduciary duties under the DSTA are modified and restricted pursuant to the Trust Agreement in accordance with the DSTA, and is allowed to take into account the interests of parties other than, the Fund and its Shareholders in resolving conflicts of interest; The Fund has agreed to indemnify the Sponsor and its affiliates pursuant to the Trust Agreement; The Sponsor is responsible for allocating its own limited resources among different clients and potential future business ventures, to each of which it owes fiduciary duties; The Sponsor s staff also services affiliates of the Sponsor and their respective clients and cannot devote all of its, or their, respective time or resources to the management of the business and affairs of the Fund; The Sponsor, its affiliates and their officers and employees are not prohibited from engaging in other businesses or activities, including those that might be in direct competition with the Fund; There is an absence of arm s-length negotiation with respect to certain terms of the Fund, and, where applicable, there has been no independent due diligence conducted with respect to this offering; The Sponsor decides whether to retain separate counsel, accountants or others to perform services for the Fund; and The Sponsor may appoint an agent to act on behalf of the Shareholders, which may be the Sponsor or an affiliate of the Sponsor. By investing in the Shares, investors agree and consent to the provisions set forth in the Trust Agreement. That notwithstanding, the Sponsor is a registered investment adviser under the Advisers Act and is subject to fiduciary duties in connection therewith. For a further discussion of the conflicts of interest among the Sponsor, Authorized Purchasers, Kaiko, Solactive, Bitcoin Custodian and/or Non-Digital Custodian, Fund and others, see "Conflicts of Interest." Affiliates of the Sponsor may invest in or trade bitcoin and/or carbon credit futures without regard to the interests of the Fund or its Shareholders. Affiliates of the Sponsor may have direct investments in bitcoins and/or invest in carbon credit futures contracts. Such affiliates of the Sponsor are permitted to manage such investments, taking into account their own interests, without regard to the interests of the Fund or its Shareholders. Affiliates of the Sponsor may obtain exposure to bitcoins and carbon credit futures through investment in the Shares. To the extent that any substantial investment in bitcoins and/or carbon credit futures contracts is initiated, materially increased or materially reduced, such investment can affect the Bitcoin Price and/or value of the Carbon Credit Futures. The initiation of, or material increases in, a substantial investment in bitcoins and/or carbon credit futures may result in an increase in the value of the Index. A material reduction in a substantial investment may result in a decrease in the Bitcoin price and/or Carbon Credit Futures, having a negative impact on the value of Shares. See "Conflicts of Interest—General." The Bitcoin Custodian nor the Non-Digital Custodian owe any fiduciary duties to the Fund or the Shareholders, are not required to act in their best interest and could resign or be removed by the Sponsor, which could trigger early termination of the Fund. The Bitcoin Custodian nor the Non-Digital Custodian is a trustee for, and owes no fiduciary duties to, the Fund or the Shareholders. In addition, the Custodians have no duty to continue to act as a custodian of the Fund. Any of the Custodians can terminate its role as custodian for any reason whatsoever upon the notice period provided under the respective Bitcoin Custody Agreement or Non-Digital Custody Agreement. The Custodians may also be terminated. If one of the Custodians resigns or is removed without replacement, the Fund will dissolve in accordance with the terms of the Trust Agreement. The Custodians ability to adopt technology in response to changing security needs or trends poses a challenge to the safekeeping of the Fund s assets. While the Bitcoin Custodian is required to safeguard the Bitcoin Assets from theft, loss, destruction or other issues relating to hackers and technological attack, its ability to do so is based upon known technology and threats. As technological change occurs, the security threats to the Bitcoin Assets will likely adapt and previously unknown threats may emerge. Furthermore, the Sponsor believes that the Fund may become a more appealing target of security threats as the size of the Fund s assets grows. To the extent that the Bitcoin Custodian is unable to identify and mitigate or stop new security threats, the Bitcoin Assets may be subject to theft, loss, destruction or other attack, which could have a negative impact on the performance of the Shares. Shareholders may be adversely affected by the lack of independent advisers representing investors in the Fund. The Sponsor has consulted with legal counsel, accountants and other advisers regarding the formation and operation of the Fund. No legal counsel has been appointed to represent an investor in connection with the offering of the Shares. Accordingly, an investor should consult his, her or its own legal, tax and financial advisers regarding the desirability of an investment in the Shares. Lack of such consultation may lead to an undesirable investment decision with respect to investment in the Shares. Shareholders may be adversely affected by lack of regular shareholder meetings and no voting rights. Under the Trust Agreement, Shareholders have limited voting rights and the Fund will not have regular Shareholder meetings and take no part in the management or control of the Fund. Accordingly, Shareholders do not have the right to authorize actions, appoint service providers or take other actions as may be taken by shareholders of other trusts or companies where shares carry such rights. Shareholders may, however, remove and replace the Sponsor by the affirmative vote of a majority of the outstanding Shares. The Shareholders limited voting rights, however, give almost all control under the Trust Agreement to the Sponsor and the Trustee. The Sponsor may take actions in the operation of the Fund that may be adverse to the interests of Shareholders. The Sponsor s operation of the Fund could adversely affect an investment in the Shares. Investment objective and investment strategy Investment Objective The Fund s investment objective is to reflect the price of bitcoin and the value of Carbon Credit Futures, as represented by the 7RCC Kaiko Bitcoin Carbon Credit Index, less expenses from the Fund s operations. There can be no assurance that the Fund will achieve its investment objective or that the Fund s investment strategy will be successful. Principal Investment Strategies The Fund pursues its investment objective by investing 80% of its assets in bitcoin and the remaining 20% of its assets in the Carbon Credit Futures that comprise the Index. The Fund seeks these investments to reflect the price of bitcoin and Carbon Credit Futures, as represented in the Index. The Index seeks to provide exposure to bitcoin with an environmentally responsible approach with exposure to carbon credits, and is designed to track the performance of investing in a portfolio comprised of 80% of bitcoin and 20% Carbon Credit Futures. The Index s Carbon Credit Futures replicate three sub-indexes and provide exposure to the value of emissions allowances issued under the following cap-and-trade regimes: the European Union Carbon Emissions Allowance ("EU ETS"), the California Cap and Trade ("CCA"), and Regional Greenhouse Gas Initiative ("RGGI"). To obtain exposure to the EU ETS, the Index uses Intercontinental Exchange ("ICE") EUA (Carbon Emission Allowances) futures ("EU CEA Carbon Credit Futures"). To obtain exposure to the CCA, the Index uses ICE California Carbon Allowance Vintage Future contracts ("CCA Carbon Credit Futures"). To obtain exposure to the RGGI, the Index uses ICE RGGI (CO2 allowances) futures contracts ("RGGI Carbon Credit Futures"). The Fund s Carbon Credit Futures will not result in any direct participation by the Fund in any particular carbon emissions offsetting project, including any carbon emissions associated with the mining of bitcoin or the Fund s bitcoin holdings. Bitcoin Valuation The value of bitcoin is determined by the value that various market participants place on Bitcoin through their transactions. The most common means of determining the value of a bitcoin is by surveying one or more digital asset trading platforms where bitcoin is traded publicly and transparently. On such digital asset trading platforms, bitcoin is traded with publicly disclosed valuations for each executed trade, measured by one or more fiat currencies such as the U.S. dollar. OTC dealers or market makers do not typically disclose their data. There are numerous digital asset trading platforms operating worldwide, representing a substantial percentage of bitcoin buying and selling activity, and providing the most data with respect to prevailing valuation of bitcoin. The Fund utilizes the same methodology as that of the Index for determining the value of bitcoin for purposes of calculating the NAV of the Fund. The Index requires each digital asset trading platform used to calculate the price of bitcoin to meet each of the following criteria: has had operating history as a crypto asset exchange for a minimum of two years; implemented trading, deposits, and withdrawal fees for a minimum of one month without interruption; met a minimum monthly volume threshold of $30 million with respect to total trading volume; provided reliable, continuous, and valid market data for a minimum of one month; offered the possibility to withdraw and deposit for a minimum of one month, settling in 2-7 business days; chosen a jurisdiction of incorporation that offers sufficient investor protection, such as Financial Action Task Force (FATF), FAFT-style regional bodies (FSRBs), or Moneyval member states; complied with relevant AML and know-your-customer ("KYC") regulations; cooperated with requests from Kaiko and relevant regulatory bodies; has not been domiciled in a jurisdiction subject to EU restrictive measures (sanctions); provided information concerning ownership and corporate structure; and has not been declared unlawful by any governmental authority or agency with jurisdiction over the exchange. Digital asset trading platforms meeting these criteria are used to calculate the price of the bitcoin portion of the Index (the "Index Pricing Sources"). The selection of Index Pricing Sources may evolve from time to time, and Kaiko may make changes to the eligibility requirements. Kaiko reviews the eligibility of digital asset trading platforms for inclusion in the Index two times per year, and such platforms must meet Kaiko s criteria at the time of such review. As of the date of this prospectus, the following platforms are used to calculate the Index price of bitcoin: Bitstamp. Bitstamp, founded in 2011, is a cryptocurrency trading platform headquartered in Luxembourg City, Luxembourg. It allows trading between fiat currencies and cryptocurrencies such as Bitcoin, Ethereum, and others. In April 2016, Bitstamp received a license from the Luxembourg government to operate as a fully regulated payment institution across all 28 EU member states. BTSE: BTSE, established in 2018, is a cryptocurrency trading platform that offers spot and futures trading along with OTC trading and multiple settlement channels. BTSE is capable of 1 million requests per second with self-hosted infrastructure. In 2023, BTSE received an official regulatory registration under the Token and Trustworthy Technology Service Provider Act (TVTG) in Lichtenstein. Coinbase. Coinbase, established in 2012, is a cryptocurrency trading platform based in San Francisco, California, USA. It offers a platform for buying, selling, and storing various cryptocurrencies. Coinbase is registered as a Money Services Business with FinCEN in the United States and complies with applicable state money transmission laws and regulations. In April 2023, Coinbase's Bermuda division was licensed to operate cryptocurrencies in Bermuda. Crypto.com. Crypto.com, founded in 2016, is a cryptocurrency trading platform headquartered in Singapore. It provides a platform for trading, investing, and using cryptocurrencies. In North America, Crypto.com is registered as a Money Services Business with FINTRAC in Canada and FinCEN in the United States. It also holds Money Transmitter Licenses across various U.S. states. In Europe, the company received approval from the UK's Financial Conduct Authority in August 2022 and operates under the Electronic Money Institution license in several European Economic Area countries. EXMO. EXMO, established in 2014, is headquartered in London, UK and has offices in Kyiv, Ukraine. The exchange has a daily trading volume of $60 million with over 1 million KYCed users. The trading platform also offers OTC trading services and an Earn program. EXMO complies with European regulations as a registered provider in Lithuania. Recently, it paused services for UK customers due to new FCA regulations. Gemini. Gemini, established in 2014, is a cryptocurrency trading platform based in New York City, USA. It offers a platform for buying, selling, and storing digital assets. Gemini is regulated by the New York State Department of Financial Services and was the first U.S.-based licensed Ethereum trading platform. In May 2023, Gemini announced that Dublin, Ireland, would be the location for its European headquarters. itBit. itBit, founded in 2013, is a cryptocurrency trading platform headquartered in New York City, USA. It offers trading services for various digital assets. itBit is regulated by the New York State Department of Financial Services and operates under a trust charter, allowing it to offer services across the United States. Kraken. Kraken, established in 2011, is a cryptocurrency trading platform based in San Francisco, California, USA. It provides a platform for trading a wide range of digital assets. In the United States, Kraken is registered as a Money Services Business with FinCEN. In the United Kingdom, Kraken operates as a Financial Conduct Authority (FCA) Registered Cryptoasset Firm under the Money Laundering Regulations. LMAX Digital. LMAX Digital, launched in 2018, is the cryptocurrency arm of LMAX Group, a financial technology company headquartered in London, UK. It offers institutional spot cryptocurrency trading services. LMAX Digital is regulated by the Gibraltar Financial Services Commission as a Distributed Ledger Technology provider for execution and custody services. Kaiko reviews the time-weighted average price from 3:00 pm EST to 4:00 pm ET on all Index Pricing Sources, and values bitcoin as the median price amongst the Index Pricing Sources. The Sponsor believes this methodology provides a reasonable valuation of the spot price of bitcoin that is reasonably resistant to price manipulation of bitcoin. As of December 12, 2024, each Index Pricing Source had the below volume and market share: Index Pricing Source Volume (BTC) Volume (Percentage Market Share) Crypto.com 1,699.56 43.87% Coinbase 1,143.07 29.51% LMAX Digital 440.40 11.38% BTSE 204.04 5.26% Kraken 203.90 5.26% Gemini 87.41 2.25% Bitstamp 86.88 2.24% itBit 5.55 0.14% EXMO 2.80 0.07% Once it has actual knowledge of changes to the Index Pricing Sources used to calculate the Bitcoin Price, the Fund will notify Shareholders in a prospectus supplement and a current report on Form 8-K or in its annual or quarterly reports. The Sponsor, in its sole discretion, may cause the Fund to price its portfolio based upon an index, benchmark or standard other than the Index and the Bitcoin Price at any time, with prior notice to the Shareholders, if investment conditions change or the Sponsor believes that another index, benchmark or standard better aligns with the Fund s investment objective and strategy. The Sponsor may make this decision for a number of reasons, including, but not limited to, a determination that the Bitcoin Price of bitcoin differs materially from the global market price of bitcoin and/or that third parties are able to purchase and sell bitcoin on public or private markets not included among the Index Pricing Sources, and such transactions may take place at prices materially higher or lower than the Bitcoin price. The Sponsor, however, is under no obligation whatsoever to make such changes in any circumstance. In the event that the Sponsor intends to establish the Fund s NAV by reference to an index, benchmark or standard other than the Index, it will provide Shareholders with notice in a prospectus supplement and/or through a current report on Form 8-K or in the Fund s annual or quarterly reports. Purchases and Sales of Bitcoin Because the Fund will conduct creations and redemptions of Shares for cash, it will be responsible for purchasing and selling bitcoin in connection with those creation and redemption orders. The Fund may also be required to sell bitcoin to pay certain extraordinary, non-recurring expenses that are not assumed by the Sponsor. The Sponsor, on behalf of the Fund, will typically seek to buy and sell bitcoin at a price as close to the Bitcoin Price as practical. When choosing between potential counterparties, the Sponsor may consider factors other than simply the most favorable price. However, the most favorable price will be the predominant factor in determining the counterparty with which the Sponsor effectuates the contemplated transaction. Other factors that the Sponsor may consider include the size of the proposed order, as well as a counterparty s execution capabilities, reliability and responsiveness. The Authorized Purchasers will deliver only cash to create Shares and will receive only cash when redeeming Shares. Further, Authorized Purchasers involved in a creation or redemption order will not directly or indirectly purchase, hold, deliver, or receive bitcoin as part of the creation or redemption process or otherwise direct the Fund or a third party with respect to purchasing, holding, delivering, or receiving bitcoin as part of the creation or redemption process for such order. Additionally, the Fund will create Shares by receiving bitcoin from a third party that is not the Authorized Purchaser involved in the order, and the Sponsor, on behalf of the Fund—not the Authorized Purchaser—is responsible for selecting the third party to deliver the bitcoin. Further, the third party will not be acting as an agent of the Authorized Purchaser with respect to the delivery of the bitcoin to the Fund or acting at the direction of the Authorized Purchaser with respect to the delivery of the bitcoin to the Fund. Additionally, the Fund will redeem Shares by delivering bitcoin to a third party that is not the Authorized Purchaser and the Sponsor, on behalf of the Trust—not the Authorized Purchaser—is responsible for selecting the third party to receive the bitcoin. Further, the third party will not be acting as an agent of the Authorized Purchaser with respect to the receipt of the bitcoin from the Fund or acting at the direction of the Authorized Purchaser with respect to the receipt of the bitcoin from the Fund. Bitcoin Trading Counterparties. The Sponsor, on behalf of the Trust, is responsible for acquiring bitcoin from a bitcoin trading counterparty that has been approved by the Sponsor (each, a Bitcoin Trading Counterparty). JSCT, LLC (which is an affiliate of Jane Street Capital, LLC, an Authorized Purchaser for the Fund), DV Chain, LLC and Gemini are currently the Fund s Bitcoin Trading Counterparties. The Bitcoin Trading Counterparties with which the Sponsor will engage in bitcoin transactions are unaffiliated third parties and all transactions will be done on an arm s-length basis. Bitcoin Trading Counterparties are not required to have an account with the Custodians. When seeking to purchase or sell bitcoin on behalf of the Fund, the Sponsor will typically seek to buy and sell bitcoin at a price as close to the Bitcoin Price as practical from any of the approved Bitcoin Trading Counterparties. Upon notification that the Fund needs to purchase or sell bitcoin, the Sponsor will reach out to various Bitcoin Trading Counterparties and ask them for a quote regarding the terms at which they would be willing to execute the contemplated transaction. The Sponsor then determines the Bitcoin Trading Counterparty with which it wishes to transact and records the rationale for that determination. Once agreed upon, the transaction will generally occur on an "over-the-counter" basis. In the event that the Fund engages other Bitcoin Trading Counterparties, transfers of bitcoin may be conducted as "on-chain" transactions represented on the bitcoin Blockchain. The Sponsor maintains a process for approving and monitoring Bitcoin Trading Counterparties. All Bitcoin Trading Counterparties must be approved by the Sponsor before the Fund will engage in transactions with the entity. The Sponsor continuously reviews all approved Bitcoin Trading Counterparties and will reject the approval of any previously approved Bitcoin Trading Counterparty if new information arises regarding the entity that puts the appropriateness of that entity as an approved bitcoin trading counterparty in doubt. The Sponsor has instituted policies and procedures to evaluate which Bitcoin Trading Counterparties to approve. Carbon Credit Futures Futures contracts are standardized contracts that obligate the parties to buy or sell an asset at a predetermined price and date in the future. The Carbon Credit Futures that comprise the sleeve of the Index are linked to the value of emissions allowances issued under the EU ETS, CCA and RGGI include EU CEA Carbon Credit Futures, CCA Carbon Credit Futures and RGGI Carbon Credit Futures. Commodity futures contracts linked to the value of emission allowances are known as "carbon credit futures". The Index is comprised of futures contracts on emissions allowances issued by various "cap-and-trade" regulatory regimes that seek to reduce greenhouse gas emissions over time. A cap-and-trade regime typically involves a regulator setting a limit on the total amount of specific greenhouse gases ("GHG") (such as CO2) that can be emitted by regulated entities. Capping and reducing the cap on GHGs is viewed as a key policy tool in reaching climate change objectives. The regime is designed to promote sustainable development by putting a price on carbon emissions. The regulator will then issue or sell "emissions allowances" to regulated entities, which in turn may buy or sell the emissions allowances to the open market. To the extent that the regulator may then reduce the cap on emission allowances, regulated entities are incentivized to reduce their emissions; otherwise, they must purchase additional emission allowances on the open market, where the price of such allowances will likely be increasing as a result of demand, and regulated entities that reduce their emissions will be able to sell unneeded emission allowances for profit. An emission allowance or carbon credit is a unit of emissions (typically one ton of CO2) that the owner of the allowance or credit is permitted to emit. Futures contracts linked to the value of emission allowances are known as "carbon credit futures". Descriptions of each of the EU ETS, CCA and RGGI are below: EU ETS: EU ETS cap-and-trade regime is a cornerstone of the EU s policy to combat climate change and is a key tool for reducing greenhouse gas emissions cost-effectively. It was the world s first major carbon market and remains among the largest. The EU ETS is a cap & trade mechanism that was launched in 2005 and has become the largest GHG trading mechanism in the world, covering approximately 11,000 installations generating carbon emissions in certain sectors, such as power generation, utilities, iron, steel, and cement. Under the mechanism, each country has a national allocation plan that determines the caps on GHG emissions for each participating entity. Participants are allocated some free European Union Allowances ("EUAs") and may purchase a proportion through auction. Participants have to monitor their emissions and after each year submit EUAs equivalent to their verified emissions. Participants that do not have sufficient EUAs can buy them from other participants that have a surplus, or within certain limits, use other eligible carbon credits for compliance purposes instead of EUAs. EUAs are allocated under the National Allocation Plan of each country within the EU ETS. Each EUA represents one tonne of CO2 or the equivalent amount of nitrous oxide (N2O) and perfluorocarbons (PFCs) ("CO2e"). The EU ETS began with a first Phase running from 2005 to 2007. Phase II of the mechanism is in line with the first Kyoto period and ran from 2008-2012. Phase III ran between 2013 to 2020. Phase IV commenced in 2021 and will run until 2030. Allocations in Phase II were reduced from their respective levels in Phase I to ensure that they were consistent with meeting national Kyoto targets. In Phase III, while some participants were still allocated free allowances, auctioning is the default method for allocating allowances. In addition, EU legislation enables banking of credits between Phases (e.g., from Phase II to Phase III, although this was not possible between Phase I and Phase II). In 2023, the EU adopted and implemented important reforms of the EU ETS framework as part of: the "Fit for 55" package, to align the system with the EU s 2030 climate target of at least 55% net emissions reductions compared to 1990 levels and the European Green Deal objectives, the EU s response to the energy crisis caused by Russia s invasion of Ukraine ("REPowerEU" plan). EUA pricing is set by supply and demand. Supply is determined by EUAs and other carbon credits (CERs, EUAs) which are available to the market. Demand is determined by the volume of carbon emitted during the year in relation to the annual allocation. The main factors influencing volumes emitted in the short-term are the weather, relative fuel prices, general economic activity and the amount of electricity generated from non-fossil fuel sources. The bulk of exchange trading activity in EUAs is concentrated on the ICE Endex Energy exchange ("ICE"). CCA: The CCA cap-and-trade regime is designed to reduce greenhouse gas ("GHG") emissions from major sources (covered entities) by setting a firm cap on statewide GHG emissions while employing market mechanisms to cost-effectively achieve the emission-reduction goals. The statewide cap for GHG emissions from major sources, which is measured in metric tons of carbon dioxide equivalent (MTCO2e), commenced in 2013 and has declined over time, achieving GHG emission reductions throughout the program s duration. Each covered entity will be required to surrender one permit to emit (the majority of which will be allowances, entities are also allowed to use a limited number of ARB offset credits) for each ton of GHG emissions they emit. Certain covered entities will be allocated allowances and will be able to buy additional allowances at auction, purchase allowances from others, or purchase offset credits. Carbon credits issued under the CCA cap-and-trade regime include carbon credits issued by Quebec since the California and Quebec markets were linked pursuant to the Western Climate Initiative in 2014. Currently, carbon credits issued by Quebec each year consist of approximately 17-18% of the carbon credits issued under the CCA cap-and-trade regime. This percentage is subject to change and it is possible for additional markets to be added in the future. RGGI: The RGGI is a cooperative market-based effort among Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island, Vermont and Virginia to cap and reduce CO2 emissions from the power sector. RGGI was the first cap-and-trade regional initiative implemented in the United States. The RGGI is composed of individual CO2 Budget Trading Programs in each participating state. Through independent regulations, based on the RGGI Model Rule, each state's CO2 Budget Trading Program limits emissions of CO2 from electric power plants, issues CO2 allowances and establishes participation in regional CO2 allowance auctions. Within the RGGI states, fossil-fuel-fired electric power generators with a capacity of 25 megawatts1 or greater ("regulated sources") are required to hold allowances equal to their CO2 emissions over a three-year control period. A CO2 allowance represents a limited authorization to emit one short ton of CO2 from a regulated source, as issued by a participating state. Regulated sources can use a CO2 allowance issued by any participating state to demonstrate compliance in any state. They may acquire allowances by purchasing them at regional auctions, or through secondary markets. For 2024, the RGGI cap for the eleven participating states is 157,184,044 CO2 allowances and the adjusted cap is 142,422,869 CO2 allowances. The Fund will invest in the Carbon Credit Futures that comprise the Index. Futures contracts are agreements between two parties that are executed on a designated contract market ("DCM"), i.e., a commodity futures exchange, and that are cleared and margined through a derivatives clearing organization ("DCO"), i.e., a clearing house. The DCMs utilized by the Fund will be Chicago Mercantile Exchange ("CME"), Intercontinental Exchange, Inc. and EUREX. The DCOs utilized by the Fund are CME Clearing, ICE Clear, and LCH Clearnet. The Carbon Credit Futures are financially settled, which means that one party agrees to buy a commodity such as bitcoin from the other party at a later date at a price and quantity agreed upon when the contract is made, but instead of taking physical delivery of the commodity at such later date, settlement occurs in a dollar amount that is equivalent to the amount agreed to in the contract. In market terminology, a party who purchases a futures contract is long in the market and a party who sells a futures contract is short in the market. The contractual obligations of a buyer or seller may generally be satisfied by financial settlement or by making an offsetting sale or purchase of an identical futures contract on the same or linked exchange before the designated date of delivery. The difference between the price at which the futures contract is purchased or sold and the price paid for the offsetting sale or purchase, after allowance for brokerage commissions, constitutes the profit or loss to the trader. If the price of the underlying asset increases after the original futures contract is entered into, the buyer of the futures contract will generally be able to sell a futures contract to close out its original long position at a price higher than that at which the original contract was purchased, generally resulting in a profit to the buyer. Conversely, the seller of a futures contract will generally profit if the price of the underlying asset decreases, as it will generally be able to buy a futures contract to close out its original short position at a price lower than that at which the original contract was sold. Because the Fund seeks to track the Index, the Fund intends to hold only long positions in Carbon Credit Futures and intends to roll its Carbon Credit Futures prior to expiration via sales of existing long positions and the acquisition of new long positions as replacements for contracts sold. Futures contracts are typically traded on futures exchanges (i.e., DCMs) which provide centralized market facilities in which multiple persons may trade contracts. Members of a particular futures exchange and the trades executed on such exchange are subject to the rules of that exchange. Futures exchanges and their related clearing organizations (i.e., DCOs) are given reasonable latitude in promulgating rules and regulations to control and regulate their members. Trades on a futures exchange are generally cleared by the DCO, which provides services designed to mutualize or transfer the credit risk arising from the trading of contracts on an exchange. The clearing organization effectively becomes the other party to the trade, and each clearing member party to the trade looks only to the clearing organization for performance. The Carbon Credit Futures are cash-settled, and the Fund will not be required to take physical delivery. Positions may also be closed out to meet orders for redemption Baskets, in which case the proceeds from closing a particular position or positions will not be reinvested. Position Limits, Accountability Levels, and Dynamic Price Fluctuation Limits may potentially cause a tracking error between the price of the Shares and the Index. The Fund does not intend to limit the size of the offering and will attempt to invest in Carbon Credit Futures and cash and cash equivalents to replicate the exposure of the Index. If the Fund encounters position limits, accountability levels, or price fluctuation limits for Carbon Credit Futures, it could force the Fund to limit the number of Baskets that it sells. Over time, the price of carbon credits fluctuates based on a number of market factors, including demand. The value of Carbon Credit Futures likewise fluctuates in reaction to a number of market factors. Because the Fund seeks to maintain its holdings in Carbon Credit Futures, the Fund must periodically "roll" futures contract positions, closing out soon to expire contracts that will no longer be part of the Index and entering into subsequent to expire contracts. One factor determining the total return from investing in futures contracts is the price relationship between soon to expire contracts and later to expire contracts. If the futures market is in a state of backwardation, the Fund will buy later to expire contracts for a lower price than the sooner to expire contracts that it sells. Hypothetically, and assuming no changes to either the underlying asset or the price relationship between soon to expire contracts and later to expire contracts, the value of a contract will rise as it approaches expiration. Over time, if backwardation remained constant, the differences would continue to increase. If the futures market is in contango, the Fund will buy later to expire contracts for a higher price than the sooner to expire contracts that it sells. Hypothetically, and assuming no other changes to either the underlying asset or the price relationship between the asset, soon to expire contracts and later to expire contracts, the value of a contract will fall as it approaches expiration. Over time, if contango remained constant, the difference would continue to increase. All other things being equal, a situation involving prolonged periods of contango may adversely impact the returns of the Fund; conversely a situation involving prolonged periods of backwardation may positively impact the returns of the Fund. The Fund is required to post margin with respect to its investment in Carbon Credit Futures. "Initial margin" is an amount of funds that must be deposited to initiate an open position in futures contracts. A margin deposit is like a cash performance bond. It helps assure the trader s performance of the futures contracts that he or she purchases or sells. Futures contracts are customarily bought and sold on an initial margin that represents a small percentage of the aggregate purchase or sales price of the contract. The amount of margin required in connection with a particular futures contract is set by the exchange on which the contract is traded. Futures contracts are marked to market at the end of each trading day and the margin required with respect to such contracts is adjusted accordingly. This process of marking to market is designed to prevent losses from accumulating in any futures account. Therefore, if the Fund s futures positions have declined in value, the Fund may be required to post "variation margin" to cover this decline. Alternatively, if the Fund s futures positions have increased in value, this increase will be credited to the Fund s account. The Fund seeks to have the aggregate "notional" amount of the Carbon Credit Futures mirror the exposure of the Index. At any given time, however, most of the Fund s investments with respect to the Carbon Credit Futures are in cash and cash equivalents that support the Fund s position in the Carbon Credit Futures. To secure its position in the Carbon Credit Futures, the Fund will deposit the required margin with the FCM and will separately hold its remaining assets through its Non-Digital Custodian in cash and cash equivalents, which specifically include: (a) cash; (b) debt securities issued or directly or indirectly fully guaranteed or insured by the United States or any agency or instrumentality thereof (such as U.S. Treasury Bills); (c) commercial paper or finance company paper of sufficient credit quality in the view of the Sponsor; or (d) money market mutual funds. Additionally, the Fund will use spot market or foreign exchange forwards and customary foreign exchange hedging instruments to seek to remove its foreign currency exposure. Such remaining assets may be used to meet future margin payments that the Fund is required to make on its Carbon Credit Futures. The Fund earns interest and other income from the cash equivalents that it purchases, and on the cash, it holds through the Non-Digital Custodian or other financial institutions. The earned interest and other income increase the Fund s NAV. The Fund applies the earned interest and other income to the acquisition of additional investments or uses it to pay its expenses. When the Fund reinvests the earned interest and other income, it makes investments that are consistent with its investment objectives. As an example, assume that a Creation Basket is sold by the Fund, and that the Fund s closing NAV per Share is $25.00. In that case, the Fund would receive $25,000 in proceeds from the sale of the Creation Basket ($25.00 NAV per Share multiplied by 10,000 Shares and ignoring the transaction fee of $300). The Sponsor would allocate 80% of the proceeds to bitcoin ($20,000) and 20% to Carbon Credit Futures ($5,000) in proportion to those represented in the Index. Assuming a margin requirement equal to 10% of the value of the Carbon Credit Futures (the amount of margin required for Carbon Credit Futures varies by contract and exchange), the Fund would be required to deposit $500 in cash with the FCM through which the Carbon Credit Futures were purchased. The remainder of the proceeds from the sale of the Creation Basket allocated to the Fund s carbon investments (i.e., 20% of the value of the Creation Basket), $4,500, would remain invested in cash, and/or cash equivalents as determined by the Sponsor from time to time based on factors such as potential calls for margin or anticipated redemptions. The above notwithstanding, the Fund invests in Carbon Credit Futures that comprise each of the Solactive subindices (see below for additional information), in weights reflected by the Index. As of the date of this prospectus, 11% of the Index is comprised of EU CEA Carbon Credit Futures, 8% of the Index is comprised of CCA Carbon Credit Futures that reference CCA and 1% of the Index is comprised of RGGI Carbon Credit Futures. Accordingly, of the $5,000 in proceeds indicated above, $2,750 would be allocated to EU CEA Carbon Credit Futures (of which, assuming a 10% margin requirement, $275 would be deposited in cash with the FCM), $2,000 would be allocated to CCA Carbon Credit Futures (of which, assuming a 10% margin requirement, $200 would be deposited in cash with the FCM) and $250 would be allocated to RGGI Carbon Credit Futures (of which, assuming a 10% margin requirement, $25 would be deposited in cash with the FCM). In the event of a redemption order, the Fund would liquidate the necessary Carbon Credit Futures necessary to cover the portion of the redemption order, and similarly sell the necessary amount of bitcoin, which in aggregate, would cover the funds to meet the redemption request and maintain the 80% / 20% weightings of bitcoin and Carbon Credit Futures represented by the Index. As an example, assume that the Fund receives a redemption request for a Basket and that the Fund s closing NAV per Share is $25.00. The Fund would need to raise $25,000 in cash to meet such redemption request ($25.00 NAV per Share multiplied by 10,000 Shares and ignoring the transaction fee of $300). The Sponsor would instruct the sale of $20,000 worth of bitcoin and $5,000 worth of notional value of the respective Carbon Credit Futures to maintain the appropriate exposure to the Index. The proceeds of such sales would be used for the redemption order. The Index The Index provides exposure to the daily price performance of bitcoin and Carbon Credit Futures by aiming to track the financial performance of investing in a portfolio of 80% bitcoin and 20% Carbon Credit Futures. In providing this exposure, the Index seeks to provide exposure to bitcoin with an environmentally responsible approach through exposure to carbon credits. The Index does not provide exposure to futures contracts that are specifically linked to bitcoin mining or other related processes. Kaiko is the index provider, benchmark administrator and calculates the Bitcoin Price. Kaiko is also the central recipient of input data and evaluates the integrity and accuracy of the input data. Solactive is the calculation agent of the Index and is also the index provider of each of the Sub-indexes detailed below. Bitcoin is valued in accordance with the procedures outlined above in "Investment Objective and Investment Strategy — Principal Investment Strategies — Bitcoin Valuation". The Index is calculated on any day the Exchange is open for trading. The Index value will be calculated as of 4:00 p.m. ET, and published after 4:10 ET on such days. Bitcoin represents 80% of the value of the Index with the remaining 20% represented by various interests in Carbon Credit Futures. The Carbon Credit Futures portion of the Index is built using a combination of three carbon credit indices, each of which is calculated and administered by Solactive: Solactive Future Series European Carbon Credit Rolling Futures Index (the "European Sub-index"), Solactive Future Series California Carbon Rolling Futures Index (the "California Sub-index"), and the Solactive Future Series Regional Greenhouse Gas Rolling Futures Index (the "RGGI Sub-index" and, collectively with the European Sub-index and the California Sub-index, the "Sub-indexes"). The combination of exposure to the three underlying indices provides the Index with returns tied to futures contracts on carbon credits connected to EU ETS, CCA and RGGI. Solactive calculates the value of the Carbon Credit Futures for the Index in accordance with the valuation of the Carbon Credit Futures Sub-indexes, detailed below. The Carbon Credit Futures represented by the European Sub-index are denominated in euros, however the Index is published in U.S. dollars. The European Sub-index employs the 4:00 p.m. London WM/Reuters Fixing to convert the value of the European Sub-index in euros to a value in U.S. dollars. For additional information regarding each of the European Sub-index, California Sub-index and RGGI Sub-index, please see "Carbon Credit Futures Sub-indexes" below). The Sub-indexes include only Carbon Credit Futures that mature in the upcoming December. Specifically, each Sub-index includes front-month futures contracts that are rolled over a five day period prior to the expiration of such contracts in December to new contracts that expire in December of the subsequent year. For example, if the specific Sub-index holds front-month Carbon Credit Futures that expire in December 2025, when such contracts approach their expiration date, the Sub-index will roll such contracts into Carbon Credit Futures that expire in December 2026. The Index does not equally weight its exposure to the Carbon Credit Futures that comprise the Sub-indexes. Rather it seeks exposure to the reference carbon credits proportional to the trading volume of the back-month Carbon Credit Futures over the last 22 trading days prior to the December rebalancing. As of the date of this prospectus, 11% of the Index is comprised of EU CEA Carbon Credit Futures, 8% of the Index is comprised of CCA Carbon Credit Futures that reference CCA and 1% of the Index is comprised of RGGI Carbon Credit Futures. The below table provides the volume and allocation for the specific Carbon Credit Futures on ICE as of December 12, 2024: Carbon Credit Futures Volume Allocation EU CEA Carbon Credit Futures 23,493 11% CCA Carbon Credit Futures 5,129 8% RGGI Carbon Credit Futures 393 1% The Index rebalances quarterly in March, June, September and December. The December rebalance of the Index is the business day immediately following the roll of Carbon Credit Futures for each of the Sub-indexes. Index data and the description of the Index are based on information made publicly available by the Benchmark Administrator. None of the information on the Benchmark Administrator s website is incorporated by reference into this prospectus. The Fund will notify Shareholders of any material change in the methodology of the Index or the respective Sub-indexes in a prospectus supplement and/or a current report on Form 8-K or in its annual or quarterly reports. Carbon Credit Futures Sub-indexes. The Sub-indexes are excess return indexes that roll exposure to the underlying futures contracts over five days. The European Sub-index seeks to track the performance of the Intercontinental Exchange EUA (Carbon Emission Allowances) futures. The California Sub-index seeks to track the performance of the ICE California Carbon Allowance Vintage Future contracts. The RGGI Sub-index seeks to track the performance of the ICE RGGI (CO2 allowances) futures contracts. Each Sub-index has been calculated back to a start date of January 16, 2024 (the "Start Date") and the initial level of each Sub-index on the Start Date was 100. The Sub-indexes are owned, calculated, administrated, and published by Solactive AG assuming the role as index owner and index administrator under the Regulation (EU) 2016/1011. The levels of each Sub-index is calculated on each day on which the ICE Futures U.S. is open for general business (the "Calculation Day") based on the trading prices on the ICE Futures U.S. on which the futures contracts currently reflected in the respective Sub-index (the "Sub-index Components") are listed. The levels for the RGGI Sub-index and California Sub-index are calculated on each Calculation Day from 3:00 to 16:00 ET. A closing level for each of the RGGI Sub-Index and California Sub-index is calculated based on the last trading price of the respective Sub-index Component prior to 16:00 ET. If the trading price to determine the closing level of the respective Sub-index for any of the Sub-index Components is unavailable, the "Settlement Level" (detailed below) of the Sub-index Component published by the respective exchange on which the Sub-index Component is listed will be used. The level for the European Sub-index is calculated on each Calculation Day from 8:00 to 19:00 CET (2:00 to 13:00 ET). A closing level for the European Sub-index for each Calculation Day is calculated based on the Settlement Level of the Sub-index Component. The "Settlement Level" is an underlying security s final regular-hours price at which a futures contract will reference at the end of each Calculation Day and upon its expiration published by the ICE Futures U.S. and determined in accordance with the ICE Futures U.S. regulations. In the event that a Sub-index Component has no closing level or settlement level, such a day will be treated as a market disruption day, and the level of the respective Sub-index will not be published. Sub-index Components are selected according to the Roll Period (defined below) and in accordance with each Sub-index s pre-determined roll schedule (the "Roll Schedule"). The replacement of the current active contract as set forth in the Roll Schedule (the "Active Contract") by the next active contract as set forth in the Roll Schedule (the "Next Active Contract") will be implemented over a five-day roll period (the "Roll Period"). The Roll Period starts on the Trading Day (defined as a day on which the respective Sub-index is open for trading (or a day that would have been such a day if a market disruption had not occurred) (the "Roll Start Date"), excluding days on which trading may be ceased prior to the normal Sub-index closing time) preceding the expiry day of the Active Contract by fifteen Trading Days. The Contract Roll Weight of the Active Contract is then decreased by 1/5 after the close of each Trading Day of the Roll Period starting at 100% while the Contract Roll Weight of the Next Active Contract is increased by 1/5 after the close of each Trading Day of the Roll Period starting at 0%. After the end of the Roll Period (inclusive of the Trading Day which is five days after the Roll Start Date (the "Roll End Date")) the Next Active Contract becomes the Active Contract. Once the expiry date (the "Roll Anchor"), anchort as of Calculation Day t is determined, in relation to Calculation Day t, the Roll Start, RollStartt, is set to negative 15 (the "Roll Offset") plus one Calculation Day before anchort. Roll End, RollEndt, as of Calculation Day t is set to be exactly the number of "Roll Days" many Calculation Days after Roll Start, RollStartt. In relation to Calculation Day t, the Contract Roll Weight of the Active Contract is calculated as follows: # is the number of Calculation Days between Calculation Day t (inclusive) and RollEndt (exclusive) In relation to Calculation Day t_the Contract Roll Weight of the Next Active Contract is calculated as follows: Roll Anchor would be set to the Active Contract s expiration date. Therefore, Roll Start would be the fifteenth last day before expiration. Weekday Mon Tue Wed Thu Fri Mon Tue Wed Thu Fri Named Day Roll Start Roll End Roll Anchor Weight of the Active Contract 100% 100% 100% 80% 60% 40% 20% 0% 0% 0% Weight of the Next Active Contract 0% 0% 0% 20% 40% 60% 80% 100% 100% 100% Each Sub-index is calculated on any given Trading Day t and published in USD in accordance with the following formula: is the Sub-index level on the Trading Day immediately preceding Trading Day t with I star date = is the Contract Roll Weight of the Active Contract, c, on Trading Day t is the Contract Roll Weight of the Next Active Contract, nc, on Trading Day t is the Settlement Level of the Active Contract, c, on Trading Day t is the Settlement Level of the Next Active Contract, nc, on Trading Day t The methodology of each Sub-index is subject to regular review, at least annually. In case a need of a change of the methodology has been identified within such review (e.g., if the underlying market or economic reality has changed since the launch of the respective Sub-index, i.e., if the present methodology is based on obsolete assumptions and factors and no longer reflects the reality as accurately, reliably and appropriately as before), such change will be made in accordance with the Solactive Methodology Policy, which is available on Solactive s website, and published on Solactive s website. OVERVIEW OF THE BITCOIN INDUSTRY AND MARKET This section of the prospectus provides a more detailed description of bitcoin, including information about the historical development of bitcoin, how a person holds bitcoin, how to use bitcoin in transactions, how to trade bitcoin, the "exchange" market where bitcoin can be bought, held and sold, the bitcoin over-the-counter ("OTC") trading market and bitcoin mining. In this prospectus, Bitcoin with an upper-case "B" is used to describe the system as a whole that is involved in maintaining the ledger of bitcoin ownership and facilitating the transfer of bitcoin among parties. When referring to the digital asset within the Bitcoin Network, bitcoin is written with a lower-case "b" (except, of course, at the beginning of sentences or paragraph sections, as below). Bitcoin Bitcoin is the digital asset that is native to, and created and transmitted through the operations of, the peer-to-peer Bitcoin Network, a decentralized network of computers that operates on cryptographic protocols. No single entity owns or operates the Bitcoin Network, the infrastructure of which is collectively maintained by a decentralized user base. The Bitcoin Network allows people to exchange tokens of value, called bitcoin, which are recorded on a public transaction ledger known as the Blockchain. Bitcoin can be used to pay for goods and services, or it can be converted to fiat currencies, such as the U.S. dollar, at rates determined on digital asset trading platforms or in individual end-user-to-end-user transactions under a barter system. Although nascent in use, bitcoin may be used as a medium of exchange, unit of account or store of value. The Bitcoin Network is decentralized and does not require governmental authorities or financial institution intermediaries to create, transmit or determine the value of bitcoin. In addition, no party may easily censor transactions on the Bitcoin Network. As a result, the Bitcoin Network is often referred to as decentralized and censorship resistant. The value of bitcoin is determined by the supply of and demand for bitcoin. New bitcoin are created and rewarded to the parties providing the Bitcoin Network s infrastructure ("miners") in exchange for expending computational power to verify transactions and add them to the Blockchain. The Blockchain is effectively a decentralized database that includes all blocks that have been solved by miners and it is updated to include new blocks as they are solved. Each bitcoin transaction is broadcast to the Bitcoin Network and, when included in a block, recorded in the Blockchain. As each new block records outstanding bitcoin transactions, and outstanding transactions are settled and validated through such recording, the Blockchain represents a complete, transparent and unbroken history of all transactions of the Bitcoin Network. Bitcoin Network Bitcoin was first described in a white paper released in 2008 and published under the pseudonym "Satoshi Nakamoto." The protocol underlying Bitcoin was subsequently released in 2009 as open-source software and currently operates on a worldwide network of computers. The Bitcoin Network and its software have been under active development since that time by a group of computer engineers known as "core developers," each of whom operates under a volunteer basis and without strict hierarchical administration. The Bitcoin Network utilizes a digital asset known as "bitcoin," which can be transferred among parties via the Internet. Unlike other means of electronic payments such as credit card transactions, one of the advantages of bitcoin is that it can be transferred without the use of a central administrator or clearing agency. As a central party is not necessary to administer bitcoin transactions or maintain the bitcoin ledger, the term decentralized is often used in descriptions of bitcoin. Unless it is using a third-party service provider, a party transacting in bitcoin is generally not afforded some of the protections that may be offered by intermediaries. The first step in directly using the Bitcoin Network for transactions is to download specialized software referred to as a "bitcoin wallet." A user s bitcoin wallet can run on a computer or smartphone, and can be used both to send and to receive bitcoin. Within a bitcoin wallet, a user can generate one or more unique "bitcoin addresses," which are conceptually similar to bank account numbers. After establishing a bitcoin address, a user can send or receive bitcoin from his or her bitcoin address to another user s bitcoin address. Sending bitcoin from one bitcoin address to another is similar in concept to sending a bank wire from one person s bank account to another person s bank account; however, such transactions are not managed by an intermediary and erroneous transactions generally may not be reversed or remedied once sent. The amount of bitcoin associated with each bitcoin address, as well as each bitcoin transaction to or from such bitcoin address, is transparently reflected in the Blockchain and can be viewed by websites that operate as "blockchain explorers." Copies of the Blockchain exist on thousands of computers on the Bitcoin Network throughout the Internet. A user s bitcoin wallet will either contain a copy of the blockchain or be able to connect with another computer that holds a copy of the blockchain. The innovative design of the Bitcoin Network protocol allows each bitcoin user to trust that their copy of the Blockchain will generally be updated consistent with each other user s copy. When a bitcoin user wishes to transfer bitcoin to another user, the sender must first request a Bitcoin address from the recipient. The sender then uses his or her Bitcoin wallet software to create a proposed transaction that is confirmed and settled when included in the Blockchain. The transaction would reduce the amount of bitcoin allocated to the sender s bitcoin address and increase the amount allocated to the recipient s bitcoin address, in each case by the amount of bitcoin desired to be transferred. The transaction is completely digital in nature, similar to a file on a computer, and it can be sent to other computers participating in the Bitcoin Network; however, the use of cryptographic verification is believed to prevent the ability to duplicate or counterfeit bitcoin. Bitcoin Protocol The Bitcoin protocol is built using open-source software, meaning any developer can review the underlying code and suggest changes. There is no official company or group that is responsible for making modifications to Bitcoin. There are, however, a number of individual developers that regularly contribute to a specific distribution of Bitcoin software known as the "Bitcoin Core," which is maintained in an open-source repository on the website Github. There are many other compatible versions of Bitcoin software, but Bitcoin Core provides the de-facto standard for the Bitcoin protocol, also known as the "reference software." The core developers for Bitcoin Core operate under a volunteer basis and without strict hierarchical administration. Significant changes to the Bitcoin protocol are typically accomplished through a so-called "Bitcoin Improvement Proposal" or "BIP." Such proposals are generally posted on websites, and the proposals explain technical requirements for the protocol change as well as reasons why the change should be accepted. Upon its inclusion in the most recent version of Bitcoin Core, a new BIP becomes part of the reference software s Bitcoin protocol. Several BIPs have been implemented since 2011 and have provided various new features and scaling improvements. Because Bitcoin has no central authority, updating the reference software s Bitcoin protocol will not immediately change the Bitcoin Network s operations. Instead, the implementation of a change is achieved by users and transaction validators (known as "miners") downloading and running updated versions of Bitcoin Core or other Bitcoin software that abides by the new Bitcoin protocol. Users and miners must accept any changes made to the Bitcoin source code by downloading a version of their Bitcoin software that incorporates the proposed modification of the Bitcoin Network s source code. A modification of the Bitcoin Network s source code is only effective with respect to those bitcoin users and miners who download it. If an incompatible modification is accepted by a less than overwhelming percentage of users and miners, a division in the Bitcoin Network will occur such that one network will run the pre-modification source code and the other network will run the modified source code. Such a division is known as a "fork" in the Bitcoin Network. Such a fork in the Bitcoin Network occurred on August 1, 2017, when a group of developers and miners accepted certain changes to the Bitcoin Network software intended to increase transaction capacity. Blocks mined on this network now diverge from blocks mined on the Bitcoin Network, which has resulted in the creation of a new blockchain whose digital asset is referred to as "bitcoin cash." Bitcoin and Bitcoin Cash now operate as separate, independent networks, and have distinct related assets (bitcoin and bitcoin cash). Additional forks have followed the Bitcoin Cash fork, including those for Bitcoin Gold (October 24, 2017) and Bitcoin SegWit2X (December 28, 2017), in the months after the creation of Bitcoin Cash. It is possible that additional "forks" will occur in the future. Recent developments on the Bitcoin Network has enabled some functionality other than the transfer of value on the Blockchain. Following the recent activation of "Segregated Witness" on the Bitcoin Network, an alpha version of the Lightning Network was released. The "Lightning Network" is an open-source decentralized network that enables instant off-blockchain transfers of the ownership of bitcoin without the need of a trusted third party. In 2021, the Bitcoin protocol implemented the Taproot upgrade to add enhanced support for complex transactions on the network such as multi-signature transactions, which require two or more parties to execute a transaction on the Bitcoin Network. Other efforts include increased use of smart contracts and distributed registers built into, built atop or pegged alongside the Blockchain. The Fund s activities will not directly relate to such projects, though such projects may utilize bitcoin as tokens for the facilitation of their non-financial uses, thereby potentially increasing the utility of the Bitcoin Network as a whole. Conversely, projects that operate and are built within the Blockchain may increase the data flow on the Bitcoin Network and could either "bloat" the size of the Blockchain or slow confirmation times. At this time, such projects remain in early stages. Bitcoin Transactions A bitcoin transaction is similar in concept to an irreversible digital check. The transaction contains the sender s bitcoin address, the recipient s bitcoin address, the amount of bitcoin to be sent, a transaction fee and the sender s digital signature. Bitcoin transactions are secured by cryptography known as public-private key cryptography, represented by the bitcoin addresses and digital signature in a transaction s data file. Each Bitcoin Network address, or "wallet," is associated with a unique "public key" and "private key" pair, both of which are lengthy alphanumeric codes, derived together and possessing a unique relationship. The use of key pairs is a cornerstone of the Bitcoin Network technology. This is because the use of a private key is the only mechanism by which a bitcoin transaction can be signed. If a private key is lost, the corresponding bitcoin is thereafter permanently non-transferable. Moreover, the theft of a private key provides the thief immediate and unfettered access to the corresponding bitcoin. Bitcoin users must therefore understand that in this regard, bitcoin is similar to cash: that is, the person or entity in control of the private key corresponding to a particular quantity of bitcoin has de facto control of the bitcoin. For large quantities of bitcoin, holders often embrace sophisticated security measures. For a discussion of how the Fund secures its bitcoin, see "Custody of the Fund s Assets—The Bitcoin Custodian" below. The public key is visible to the public and analogous to the Bitcoin Network address. The private key is a secret and is used to digitally sign a transaction in a way that proves the transaction has been signed by the holder of the public-private key pair, without having to reveal the private key. A user s private key must be kept safe in accordance with appropriate controls and procedures to ensure it is used only for legitimate and intended transactions. If an unauthorized third person learns of a user s private key, that third person could apply the user s digital signature without authorization and send the user s bitcoin to their or another bitcoin address, thereby stealing the user s bitcoin. Similarly, if a user loses his private key and cannot restore such access (e.g., through a backup), the user may permanently lose access to the bitcoin associated with that private key and bitcoin address. To prevent the possibility of double-spending bitcoin, each validated transaction is recorded, time stamped and publicly displayed in a "block" in the Blockchain, which is publicly available. Thus, the Bitcoin Network provides confirmation against double-spending by memorializing every transaction in the Blockchain, which is publicly accessible and downloaded in part or in whole by all users of the Bitcoin Network software program. Any user may validate, through their Bitcoin wallet or a blockchain explorer, that each transaction in the Bitcoin Network was authorized by the holder of the applicable private key, and Bitcoin Network mining software consistent with reference software requirements validates each such transaction before including it in the Blockchain. This cryptographic security ensures that bitcoin transactions may not generally be counterfeited, although it does not protect against the "real world" theft or coercion of use of a bitcoin user s private key, including the hacking of a bitcoin user s computer or a service provider s systems. A bitcoin transaction between two parties is recorded if such transaction is included in a valid block added to the Blockchain. A block is accepted as valid through consensus formation among Bitcoin Network participants. Validation of a block is achieved by confirming the cryptographic hash value included in the block s data and by the block s addition to the longest confirmed blockchain on the Bitcoin Network. For a transaction, inclusion in a block on the Blockchain constitutes a "confirmation" of validity. As each block contains a reference to the immediately preceding block, additional blocks appended to and incorporated into the Blockchain constitute additional confirmations of the transactions in such prior blocks, and a transaction included in a block for the first time is confirmed once against double-spending. This layered confirmation process makes changing historical blocks (and reversing transactions) exponentially more difficult the further back one goes in the Blockchain. To undo past transactions in a block recorded on the Blockchain, a malicious actor would have to exert tremendous hashrate in re-solving each block in the Blockchain starting with and after the target block and broadcasting all such blocks to the Bitcoin Network. The Bitcoin Network is generally programmed to consider the longest Blockchain containing solved and valid blocks to be the most accurate Blockchain. In order to undo multiple layers of confirmation and alter the Blockchain, a malicious actor must re-solve all of the old blocks sought to be regenerated and be able to continuously add new blocks to the Blockchain at a speed that would have to outpace that of all of the other miners on the Bitcoin Network, who would be continuously solving for and adding new blocks to the Blockchain. If a malicious actor is able to amass ten percent (10%) of the Bitcoin Network s aggregate hashrate, there is estimated to be a 0.1 percent chance that it would be able to overcome six (6) confirmations. Therefore, given the difficulty in amassing such hashrate, six (6) confirmations is an often-cited standard for the validity of transactions. The Fund has adopted a policy whereby a transaction will be deemed confirmed upon this industry standard of six (6) confirmations (the "Confirmation Protocol"). As one (1) block is added to the Blockchain approximately every six (6) to twelve (12) minutes, a Bitcoin transaction will be, on average, confirmed using the Confirmation Protocol beyond a reasonable doubt in approximately one (1) hour. Merchants selling high-value goods and services, as well as Bitcoin Platforms and many experienced users, are believed to generally use the six (6) confirmations standard. This confirmation system, however, does not mean that merchants must always wait for multiple confirmations for transactions involving low-value goods and services. As discussed below, the value of a successful double-spending attack involving a low-value transaction may, and perhaps likely will, be significantly less than the cost involved in arranging and executing such double-spending attacks. Furthermore, merchants engaging in low-value transactions may then view the reward of quicker transaction settlements with limited or no Blockchain confirmation as greater than the related risk of not waiting for six (6) confirmations with respect to low-value transactions at points of sale. Conversely, for high-value transactions that are not time sensitive, additional settlement security can be provided by waiting for more than six (6) confirmations. Bitcoin Mining – Creation of New Bitcoins Mining Process The process by which bitcoin are created and bitcoin transactions are verified is called "mining." To begin mining, a user, or "miner," can download and run a mining "client," which, like regular Bitcoin Network software programs, turns the user s computer into a "node" on the Bitcoin Network that validates blocks, and, in this case, gives such user the ability to validate transactions and add new blocks of transactions to the Blockchain. Miners, through the use of the bitcoin software program, engage in a set of prescribed complex mathematical calculations in order to verify transactions and compete for the right to add a block of verified transactions to the Blockchain and thereby confirm bitcoin transactions included in that block s data. The miner who successfully "solves" the complex mathematical calculations has the right to add a block of transactions to the Blockchain and is then rewarded with new bitcoin, the amount of which is determined by the Bitcoin protocol, plus any transaction fees paid for the transactions included in such block. Confirmed and validated bitcoin transactions are recorded in blocks added to the Blockchain. Each block contains the details of some or all of the most recent transactions that are not memorialized in prior blocks, as well as a record of the award of bitcoin to the miner who added the new block. Each unique block can only be solved and added to the Blockchain by one miner; therefore, all individual miners and mining pools on the Bitcoin Network are engaged in a competitive process of constantly increasing their computing power to improve their likelihood of solving for new blocks. As more miners join the Bitcoin Network and its processing power increases, the Bitcoin Network adjusts the complexity of the block-solving equation to maintain a predetermined pace of adding a new block to the Blockchain approximately every ten minutes. Mathematically Controlled Supply The method for creating new bitcoin is mathematically controlled in a manner so that the supply of bitcoin grows at a limited rate pursuant to a pre-set schedule. The number of bitcoin awarded for solving a new block is automatically halved every 210,000 blocks. Thus, the current fixed reward for solving a new block is 6.25 bitcoin per block; the reward decreased from twenty-five (25) bitcoin in July 2016 and 12.5 in May 2020. The most recent halving occurred in April 2024 and the next estimated halving is expected to occur in 2028. This deliberately controlled rate of bitcoin creation means that the number of bitcoin in existence will never exceed twenty-one million (21,000,000) and that bitcoin cannot be devalued through excessive production unless the Bitcoin Network s source code (and the underlying protocol for bitcoin issuance) is altered. As of November 2024, approximately 19.8 million bitcoin are outstanding. The date when the 21 million bitcoin limitation will be reached is estimated to be the year 2140. Forms of Attack Against the Bitcoin Network All networked systems are vulnerable to various kinds of attacks. As with any computer network, the Bitcoin Network contains certain flaws. For example, the Bitcoin Network is currently vulnerable to a "51% attack" where, if a mining pool were to gain control of more than 50% of the hash rate for a digital asset, a malicious actor would be able to gain full control of the network and the ability to manipulate the Blockchain. In addition, many digital asset networks have been subjected to a number of denial-of-service attacks, which has led to temporary delays in block creation and in the transfer of bitcoin. Any similar attacks on the Bitcoin Network that impact the ability to transfer bitcoin could have a material adverse effect on the price of bitcoin and the value of the Shares. Bitcoin Market and Bitcoin Trading Platforms In addition to using bitcoin to engage in transactions, investors may purchase and sell bitcoin to speculate as to the value of bitcoin in the bitcoin market, or as a long-term investment to diversify their portfolio. The value of bitcoin within the market is determined, in part, by: (i) the supply of and demand for bitcoin in the bitcoin market; (ii) market expectations for the expansion of investor interest in bitcoin and the adoption of bitcoin by individuals; (iii), the number of merchants that accept bitcoin as a form of payment; and (iv) the volume of private end-user-to-end-user transactions. Although the value of bitcoin is determined by the value that two transacting market participants place on bitcoin through their transaction, the most common means of determining a reference value is by surveying one or more trading platforms where secondary markets for bitcoin exist. The most prominent digital asset trading platforms are often referred to as "exchanges," although they neither report trade information nor are they regulated in the same way as a national securities exchange. As such, there is some difference in the form, transparency and reliability of trading data from digital asset trading platforms. Generally speaking, bitcoin data is available from these trading platforms with publicly disclosed valuations for each executed trade, measured by one or more fiat currencies such as the U.S. dollar or Euro or another digital asset such as ether. OTC dealers or market makers do not typically disclose their trade data. Currently, there are many digital asset trading platforms operating worldwide and trading platforms represent a substantial percentage of bitcoin buying and selling activity and, therefore, provide large data sets for market valuation of bitcoin. A digital asset trading platform provides investors with a way to purchase and sell bitcoin, similar to stock exchanges like the New York Stock Exchange or Nasdaq, which provide ways for investors to buy stocks and bonds in the "secondary market." Unlike stock exchanges, which are regulated to monitor securities trading activity, digital asset trading platforms are largely regulated as money services businesses (or a foreign regulatory equivalent) and are required to monitor for and detect money-laundering and other illicit financing activities that may take place on the platform. Digital asset trading platforms operate websites designed to permit investors to open accounts with the trading platform and then purchase and sell bitcoin. As with conventional stock exchanges, an investor opening a trading account and wishing to transact at a digital asset trading platform must deposit an accepted government-issued currency into their account, or a previously acquired digital asset. The process of establishing an account with a digital asset trading platform and trading bitcoin is different from, and should not be confused with, the process of users sending bitcoin from one bitcoin address to another bitcoin address, such as to pay for goods and services. This latter process is an activity that occurs wholly within the confines of the Bitcoin network, while the former is an activity that occurs largely on private websites and databases owned by the digital asset trading platform. Although bitcoin was the first cryptocurrency, since 2009, the number of digital assets, market participants and companies in the space has increased dramatically. In addition to bitcoin, other well-known digital assets include ether, bitcoin cash and litecoin. The digital asset marketplace is still being defined and evolving, including the practices of exchanges, behavior of investors, and the protocols and prominence of particular digital assets. Prior to 2017, bitcoin accounted for approximately 85% or more of the total market capitalization of all digital assets. As of November 2024, bitcoin accounted for approximately 60% of the total market capitalization of all digital assets, according to CoinMarketCap.com. Authorized Purchasers will have the option of purchasing and selling bitcoin used in Creation Basket transactions with the Fund either on bitcoin trading platforms, in the OTC markets or in direct bilateral transactions. OTC trading and direct transactions of bitcoin are generally accomplished via bilateral agreements on a principal-to-principal basis. All risks and issues related to creditworthiness are between the parties directly involved in the transaction. Market Participants Miners Miners range from bitcoin enthusiasts to professional mining operations that design and build dedicated machines and data centers, but the vast majority is now undertaken by parties with access to high grade hardware, favorable electric prices, and industrial data centers. In addition, most mining hashrate is directed by participants in mining pools, which are groups of miners that act cohesively and combine their processing to solve blocks. When a pool adds a new block to the Blockchain, the pool operator receives the new bitcoin and, after taking a nominal fee, splits the resulting reward among the pool participants based on the processing power each of them contributed to solve for such block. Mining pools provide participants with access to smaller, but steadier and more frequent, bitcoin payouts. Investment and Speculative Sector This sector includes the investment and trading activities of both private and professional investors and speculators. These participants range from exchange-traded products, hedge funds and day-traders who invest in bitcoin by trading on digital asset trading platforms. Historically, larger financial services institutions are publicly reported to have limited involvement in investment and trading in digital assets, although the participation landscape is beginning to change and large corporations, financial institutions and investment firms are taking positions providing exposure to bitcoin and other digital assets. Retail Sector The retail sector includes users transacting in direct peer-to-peer Bitcoin transactions through the direct sending of bitcoin over the Bitcoin Network. The retail sector also includes transactions in which consumers pay for goods or services from commercial or service businesses through direct transactions or third-party service providers, such as BitPay, which provides a merchant platform for instantaneous transactions whereby the consumer sends bitcoin to BitPay, which then provides either the bitcoin or the cash value thereof to the commercial or service business utilizing the platform. PayPal, Square and Shopify are examples of traditional merchant payment processors or merchant platforms that have also added Bitcoin payment options for their merchant customers. Payment processing through the Bitcoin Network may reduce the transaction cost for merchants, relative to the costs paid for credit card transaction processing, and eliminates the potential for consumer chargebacks. Service Sector This sector includes companies that provide a variety of services including the buying, selling, payment processing and storing of bitcoin. Coinbase and Fidelity are examples of multi-service financial institutions that provide wallets that store bitcoin for users and also serve as a retail or exchange gateway whereby users can purchase bitcoin for fiat currency. BitPay is an example of Bitcoin payment processors that allow merchants to accept bitcoin as payment. As the Bitcoin Network continues to grow in acceptance, it is anticipated that service providers will expand the currently available range of services and that additional parties will enter the service sector for the Bitcoin Network. Competition More than 20,000 other digital assets have been developed since the inception of Bitcoin, currently the most developed digital asset because of the length of time it has been in existence, the investment in the infrastructure that supports it, and the network of individuals and entities that are using Bitcoin. Some industry groups are also creating private, permissioned blockchains that may or may not feature cryptocurrencies or other digital assets. In addition, private enterprises and governments are exploring the use of stablecoins including central bank digital currencies. Regulation of Bitcoin As bitcoin and digital assets have grown in both popularity and market size, the U.S. Congress and a number of U.S. federal and state agencies (including Financial Crimes Enforcement Network ("FinCen"), SEC, OCC, CFTC, FINRA, the Consumer Financial Protection Bureau ("CFPB"), the Department of Justice, the Department of Homeland Security, the Federal Bureau of Investigation, the IRS, state financial institution regulators, and others) have been examining the operations of digital asset networks, digital asset users and the digital asset exchange market. Many of these state and federal agencies have brought enforcement actions and issued advisories and rules relating to digital asset markets. Ongoing and future regulatory actions with respect to digital assets generally or any single digital asset in particular may alter, perhaps to a materially adverse extent, the nature of an investment in the Shares and/or the ability of the Fund to continue to operate. For example, the events of 2022, including among others the bankruptcy filings of FTX and its subsidiaries, Three Arrows Capital, Celsius Network, Voyager Digital, Genesis, BlockFi and others, and other developments in the digital asset markets, have resulted in calls for heightened scrutiny and regulation of the digital asset industry, with a specific focus on intermediaries such as digital asset exchanges, platforms, and custodians. Federal and state legislatures and regulatory agencies may introduce and enact new laws and regulations to regulate crypto asset intermediaries, such as digital asset exchanges and custodians. The March 2023 collapses of Silicon Valley Bank, Silvergate Bank, and Signature Bank, which in some cases provided services to the digital assets industry, or similar future events, may amplify and/or accelerate these trends. On January 3, 2023, the federal banking agencies issued a joint statement on crypto-asset risks to banking organizations following events which exposed vulnerabilities in the crypto-asset sector, including the risk of fraud and scams, legal uncertainties, significant volatility, and contagion risk. Although banking organizations are not prohibited from crypto-asset related activities, the agencies have expressed significant safety and soundness concerns with business models that are concentrated in crypto-asset related activities or have concentrated exposures to the crypto-asset sector. U.S. federal and state regulators, as well as the White House, have issued reports and releases concerning digital assets, including Bitcoin and digital asset markets. Further, in 2023 the House of Representatives formed two new subcommittees: the Digital Assets, Financial Technology and Inclusion Subcommittee and the Commodity Markets, Digital Assets, and Rural Development Subcommittee, each of which were formed in part to analyze issues concerning crypto assets and demonstrate a legislative intent to develop and consider the adoption of federal legislation designed to address the perceived need for regulation of and concerns surrounding the digital asset industry. However, the extent and content of any forthcoming laws and regulations are not yet ascertainable with certainty, and it may not be ascertainable in the near future. A divided Congress makes any prediction difficult. In August 2021, Gary Gensler, the chair of the SEC, stated that he believed investors using digital asset trading platforms are not adequately protected, and that activities on the platforms can implicate the securities laws, commodities laws and banking laws, raising a number of issues related to protecting investors and consumers, guarding against illicit activity, and ensuring financial stability. The chair expressed a need for the SEC to have additional authorities to prevent transactions, products, and platforms from "falling between regulatory cracks," as well as for more resources to protect investors in "this growing and volatile sector." The chair called for federal legislation centering on digital asset trading, lending, and decentralized finance platforms, seeking "additional plenary authority" to write rules for digital asset trading and lending. It is not possible to predict whether Congress will grant additional authorities to the SEC or other regulators, what the nature of such additional authorities might be, how they might impact the ability of digital asset markets to function or how any new regulations that may flow from such authorities might impact the value of digital assets generally and bitcoin held by the Fund specifically. The consequences of increased federal regulation of digital assets and digital asset activities could have a material adverse effect on the Fund and the Shares. In June 2023, the SEC filed lawsuits against Coinbase and Binance, two large U.S. digital asset trading platforms, alleging that Coinbase and Binance had been operating as unregistered securities exchanges, brokers and clearing agencies in violation of U.S. federal securities laws. While the SEC has not alleged that bitcoin is a security, the outcome of these enforcement actions and others may result in the substantial restructuring of the digital asset market in the United States. However, the SEC has recently faced setbacks in U.S. courts in its attempt to regulate the digital asset markets. In July 2023, the U.S. District Court for the Southern District of New York ruled on the SEC s action against Ripple Labs, Inc. The court found that offers and sales of XRP, a digital token, to institutions and sophisticated individuals constituted securities transactions, but that offers and sales of XRP on crypto exchanges, distributions to employees, and other third-party developers were not securities transactions. More recently, the D.C. Circuit Court found that the SEC s denial of the Grayscale Bitcoin Trust s listing was "arbitrary and capricious" under the Administrative Procedures Act in light of the SEC s approval of two similar bitcoin futures-based ETPs. Nonetheless, until the SEC s numerous actions against digital asset market participants are resolved, the structure of the digital asset market in the United States will remain subject to substantial regulatory risk, which may impact the demand for digital assets and the continued availability of existing exchanges and offerings. FinCEN requires any administrator or exchanger of convertible digital assets to register with FinCEN as a money transmitter and comply with the AML regulations applicable to money transmitters. In 2015, FinCEN assessed a $700,000 fine against a sponsor of a digital asset for violating several requirements of the Bank Secrecy Act by acting as a money services business and selling the digital asset without registering with FinCEN, and by failing to implement and maintain an adequate AML program. In 2017, FinCEN assessed a $110 million fine against BTC-e, a now defunct digital asset exchange, for similar violations. The requirement that exchangers that do business in the U.S. register with FinCEN and comply with AML regulations may increase the cost of buying and selling bitcoin and therefore may adversely affect the price of bitcoin and an investment in the Shares. In a March 2018 letter from FinCEN s assistant secretary for legislative affairs to U.S. Senator Ron Wyden, the assistant secretary indicated that under current law both the developers and the exchanges involved in the sale of tokens in an initial coin offering ("ICO") may be required to register with FinCEN as money transmitters and comply with the AML regulations applicable to money transmitters. The Office of Foreign Assets Control ("OFAC") of the U.S. Department of the Treasury (the "U.S. Treasury Department") has added digital currency addresses, including addresses on the Bitcoin Network to the list of Specially Designated Nationals whose assets are blocked, and with whom U.S. persons are generally prohibited from dealing. Such actions by OFAC, or by similar organizations in other jurisdictions, may introduce uncertainty in the market as to whether bitcoin that has been associated with such addresses in the past can be easily sold. This "tainted" bitcoin may trade at a substantial discount to untainted bitcoin. Reduced fungibility in the Bitcoin markets may reduce the liquidity of bitcoin and therefore adversely affect their price. Under regulations from the New York State Department of Financial Services ("NYDFS"), businesses involved in digital asset business activity for third parties in or involving New York, excluding merchants and consumers, must apply for a license, commonly known as a BitLicense, from the NYDFS and must comply with AML, cyber security, consumer protection, and financial and reporting requirements, among others. As an alternative to a BitLicense, a firm can apply for a charter to become a limited purpose trust company under New York law qualified to engage in digital asset business activity. Other states have considered or approved digital asset business activity statutes or rules, passing, for example, regulations or guidance indicating that certain digital asset business activities constitute money transmission requiring licensure. The inconsistency in applying money transmitting licensure requirements to certain businesses may make it more difficult for these businesses to provide services, which may affect consumer adoption of bitcoin and its price. In an attempt to address these issues, the Uniform Law Commission passed a model law in July 2017, the Uniform Regulation of Virtual Currency Businesses Act, which has many similarities to the BitLicense and features a multi-state reciprocity licensure feature, wherein a business licensed in one state could apply for accelerated licensure procedures in other states. It is still unclear, however, how many states, if any, will adopt some or all of the model legislation. In addition, the SEC, U.S. state securities regulators and several foreign governments have issued warnings that digital assets sold in ICOs may be classified as securities and that both those digital assets and ICOs may be subject to securities regulations. Generally speaking, ICOs are offered and conducted on the Ethereum network or similar "smart contract" platforms, rather than the Bitcoin Network; however, bitcoin has been used for consideration in ICOs on multiple networks and ICOs may be conducted using the Bitcoin Network. On-going and future regulatory actions may alter, perhaps to a materially adverse extent, the nature of an investment in the Shares or the ability of the Fund to continue to operate. Additionally, U.S. state and federal, and foreign regulators and legislatures have taken action against digital asset businesses or enacted restrictive regimes in response to adverse publicity arising from hacks, consumer harm, or criminal activity stemming from digital asset activity. In July 2019, U.S. Treasury Secretary Steven Mnuchin stated that he had "very serious concerns" about digital assets. Secretary Mnuchin indicated that one source of concern is digital assets potential to be used to fund illicit activities. In June 2020, digital asset businesses that are financial institutions were required to comply with the "travel rule" guidelines promoted by the Financial Action Task Force and adopted by government regulators in a substantial number of developed economies. The travel rule requires financial institutions to pass on certain transaction information in connection with financial transfers of size; because of the nature of the Bitcoin Network, compliance with this mandate represents a challenge for digital asset businesses including digital asset trading platforms. Various foreign jurisdictions have, and may continue to, in the near future, adopt laws, regulations or directives that affect the Bitcoin Network, the bitcoin markets, and their users, particularly digital asset trading platforms and service providers that fall within such jurisdictions regulatory scope. For example, on March 5, 2020, South Korea voted to amend its Financial Information Act to require virtual asset service providers to register and comply with its AML and CFT framework. These measures also provide the government with the authority to close digital asset trading platforms that do not comply with specified processes. The Chinese and South Korean governments have also banned ICOs and there have been consistent reports over the course of the last five years that Chinese regulators have taken formal or informal action to shut down or limit banking access to a number of China-based digital asset trading platforms. For example, on January 19, 2018, a Chinese news organization reported that the People s Bank of China had ordered financial institutions to stop providing banking or funding to "any activity related to cryptocurrencies." Similarly, in April 2018, the Reserve Bank of India banned the entities it regulates from providing services to any individuals or business entities dealing with or settling digital assets. On March 5, 2020, this ban was overturned in the Indian Supreme Court, although the Reserve Bank of India is currently challenging this ruling. There remains significant uncertainty regarding the South Korean, Indian and Chinese governments future actions with respect to the regulation of digital assets and digital asset trading platforms. Such laws, regulations or directives may conflict with those of the United States and may negatively impact the acceptance of bitcoin by users, merchants and service providers outside the United States and may therefore impede the growth or sustainability of the bitcoin economy in the European Union, China, South Korea, India and the United States and globally, or otherwise negatively affect the value of bitcoin. In July 2019, the United Kingdom s Financial Conduct Authority proposed rules to address harm to retail consumers deriving from the sale of derivatives and exchange traded notes that reference certain types of digital assets, contending that they are "ill-suited" to retail investors citing extreme volatility, valuation challenges and association with financial crime. In addition to exchange traded notes, the proposed ban would affect financial products including contracts for difference, options and futures. Public consultation on the proposed restriction closed in October 2019. As of the date of this Prospectus, the Financial Conduct Authority has not yet finalized its proposed ruling. The transparency of blockchains has in the past facilitated investigations by law enforcement agencies. However, certain privacy-enhancing features have been or are expected to be introduced to a number of digital asset networks, and these features may provide law enforcement agencies with less visibility into transaction histories. Although no regulatory action has been taken to treat privacy-enhancing digital assets differently, this may change in the future. The effect of any future regulatory change on the Fund or Bitcoin is impossible to predict, but such change could be substantial and adverse to the Fund and the value of the Shares. Bitcoin Value The value of bitcoin is determined by the value that various market participants place on Bitcoin through their transactions. The most common means of determining the value of a bitcoin is by surveying one or more Bitcoin Platforms where bitcoin is traded publicly and transparently (e.g., Coinbase, Bitstamp, Kraken, itBit, LMAX Digital and Gemini). On exchanges, bitcoin is traded with publicly disclosed valuations for each executed trade, measured by one or more fiat currencies such as the U.S. dollar or Euro. OTC dealers or market makers do not typically disclose their trade data. Currently, there are many digital asset exchanges operating worldwide, representing a substantial percentage of bitcoin buying and selling activity, and providing the most data with respect to prevailing valuations of bitcoin. Historically, a large percentage of the global Bitcoin trading volume occurred on self-reported, unregulated Bitcoin Platforms located in China. Throughout 2017, however, the Chinese government took several steps to tighten controls on Bitcoin Platforms, culminating in a ban on domestic cryptocurrency exchanges in November 2017, which forced such exchanges to cease their operations or relocate. As a result, reported bitcoin trading volume on Chinese exchanges is now substantially lower, representing a de minimis share of the global trade volume. From time to time, there may be intra-day price fluctuations across Bitcoin Platforms. However, they are generally relatively immaterial. For example, the variance of prices on Bitcoin Platforms with the highest transaction volumes on average is lower than 2%. These variances usually stem from small changes in the fee structures on different Bitcoin Platforms or differences in administrative procedures required to deposit and withdraw fiat currency in exchange for Bitcoins and vice versa. The greatest variances are found at (i) smaller exchanges with relatively low transaction volumes where even small trades can be large relative to an exchange s transaction volume and as a result impact the trading price on those exchanges and (ii) exchanges that are inaccessible to the Fund because they do not meet the Fund s regulatory requirements, and as a result are accessed and used by a captured market or by parties that do not have regulatory or compliance requirements. Historically, the Fund has not needed to make any changes in the determination of principal market due to variances in pricing, although it has changed its principal market due to disruption of operations of the Bitcoin Market considered to be the principal market. OVERVIEW OF COMMODITY Futures MARKETS and carbon markets This section of the Prospectus provides a descriptive overview of the commodity futures markets, including the market for Carbon Credit Futures. The overview briefly covers commodity futures and the regulatory scheme pursuant to which the Fund and commodity interests markets generally operate. The following description is a summary only; it is not intended to be complete. Regulatory Framework In the U.S., the purchase, sale, trade and/or marketing of interests in commodities, such as futures contracts and swap agreements, is regulated by the CEA, as modified by the Dodd-Frank Act, as well as the rules and regulations promulgated by the CFTC. The CEA establishes the statutory framework under which the CFTC operates and grants the CFTC jurisdiction over exchange traded commodities (e.g., futures and options), over-the-counter markets (e.g., swaps), as well as physical commodity transactions in interstate commerce. The CEA defines a commodity by referencing specific enumerated commodities, as well as "all services, rights, and interests . . . in which contracts for future delivery are presently or in the future dealt in." The CFTC has taken the view that certain digital assets, such as bitcoin are commodities. Through clarifications in the CFTC federal register, renewable energy credits have been deemed to be an environmental commodity, which has subsequently been expanded to include carbon credits as an environmental commodity. In 2008, the Dodd-Frank Act amended the CEA and established a comprehensive new framework for commodities that are purchased, sold, traded and/or marketed using an agreement commonly known as a "swap." Following the enactment of the Dodd-Frank Act, the CFTC was required to create, or promulgate, a multitude of rules and regulations to enforce such laws. The term "swap" includes "any agreement, contract, or transaction…that provides for any purchase, sale, payment, or delivery (other than a dividend on an equity security) that is dependent on the occurrence, nonoccurrence, or the extent of the occurrence of an event or contingency associated with a potential financial, economic, or commercial consequence." The CEA also provides a list of agreements that are also considered swaps, which includes "agreements, contracts and transactions commonly known as … (xx) agriculture swaps, (xxi) emissions swaps, and (xxii) commodity swaps." The Dodd-Frank Act provides that the CFTC shall further define the term swap and the CFTC is given authority over swaps. The CFTC possesses exclusive jurisdiction to regulate the activities of CPOs and CTAs with respect to "commodity interests," such as futures, swaps and options, and has adopted regulations with respect to the activities of those persons and/or entities. Pursuant to authority in the CEA, the NFA has been formed and registered with the CFTC as a registered futures association. At the present time, the NFA is the only self-regulatory organization for commodity interest professionals, other than DCMs. The CFTC has delegated to the NFA responsibility for the registration of CPOs, CTAs and FCMs and their respective associated persons. Under the CEA, a registered CPO, such as the Sponsor, is required to make annual filings with the CFTC and NFA describing its organization, capital structure, management and controlling persons. In addition, the CEA authorizes the CFTC to require and review books and records of, and documents prepared by, registered CPOs. Accordingly, CPOs are required to keep accurate, current and orderly records for each pool that they operate. Suspension, restriction or termination of the Sponsor s registration as a CPO would prevent it, until that registration were to be reinstated, from managing the Fund, and might result in the termination of the Fund if a successor sponsor were not elected pursuant to the Trust Agreement. The regulation of commodity interest transactions in the U.S. is an evolving area of law and is subject to ongoing modification by governmental and judicial action. Considerable regulatory attention has been focused on non-traditional investment pools that are publicly distributed in the U.S. There is a possibility of future regulatory changes within the U.S. altering, perhaps to a material extent, the nature of an investment in the Fund, or the ability of the Fund to continue to implement its investment strategy. The effect of any future regulatory change on the Fund is impossible to predict but could be substantial and adverse. The Fund will use a portion of its net assets to invest in and trade in Carbon Credit Futures; accordingly the Fund is a commodity pool and the Sponsor is a CPO subject to regulation by the CFTC and the NFA under the CEA. The offering of the Fund s Shares is registered with the SEC in accordance with the Securities Act and the Fund s Shares are registered with the SEC under the Exchange Act. Commodity Pools A commodity pool is any investment trust, syndicate, or similar form of enterprise operated for the purpose of trading in commodity interests. In relevant part, a commodity interest is a commodity for future delivery, security futures product, swap or commodity option. Since the Fund intends to use pooled funds from investors to invest in bitcoin and Carbon Credit Futures, the Fund is a "commodity pool" and is therefore subject to CFTC regulation. The term "commodity pool operator" is defined in part as "any person engaged in a business that is of the nature of a commodity pool…and who, in connection therewith, solicits, accepts, or received from others, funds, securities or otherwise, for the purpose of trading in commodity interests…". A "commodity pool operator" is required to register with the CFTC and become a member of the NFA. The Sponsor is a CPO and CTA and is registered with the CFTC and is a member of the NFA. Futures Contracts The Fund invests in Carbon Credit Futures that comprise the Index, specifically contracts that are linked to the value of emissions allowances issued under the following cap-and-trade regimes: EU ETS. CCA and RGGI. The Fund does not invest in any carbon credit futures contracts that are specifically linked to bitcoin mining or other related processes. A futures contract is a standardized contract traded on, or subject to the rules of, an exchange that calls for the future delivery of a specified quantity and type of a particular underlying asset at a specified time and place or alternatively may call for cash settlement. Futures contracts are traded on a wide variety of underlying assets, including bonds, interest rates, agricultural products, stock indexes, currencies, energy, metals, economic indicators and statistical measures. The notional size and calendar term futures contracts on a particular underlying asset are identical and are not subject to any negotiation, other than with respect to price and the number of contracts traded between the buyer and seller. Certain futures contracts settle in cash. The cash settlement amount reflects the difference between the contract purchase/sale price and the contract settlement price. The cash settlement mechanism avoids the potential for either side to have to deliver the underlying asset. For other futures contracts, the contractual obligations of a buyer or seller may generally be satisfied by taking or making physical delivery of the underlying asset or by making an offsetting sale or purchase of an identical futures contract on the same or linked exchange before the designated date of delivery. The difference between the price at which the futures contract is purchased or sold and the price paid for the offsetting sale or purchase, after allowance for brokerage commissions and exchange fees, constitutes the profit or loss to the trader. Futures contracts involve, to varying degrees, elements of market risk. Additional risks associated with the use of futures contracts are imperfect correlation between movements in the price of the futures contracts and the level of the underlying benchmark and the possibility of an illiquid market for a futures contract. With futures contracts, there is minimal but some counterparty risk to a fund since futures contracts are exchange traded and the exchange s clearing house, as counterparty to all exchange-traded futures contracts, effectively guarantees futures contracts against default. Many futures exchanges and boards of trade limit the amount of fluctuation permitted in futures contract prices during a single trading day. Once the daily limit has been reached in a particular contract, no trades may be made that day at a price beyond that limit or trading may be suspended for specified times during the trading day. Futures contracts prices could move to the limit for several consecutive trading days with little or no trading, thereby preventing prompt liquidation of futures positions. Margin Requirements "Initial" or "original" margin is the minimum amount of funds that a counterparty to a futures contract (or cleared derivatives contract) must deposit with their commodity broker in order to establish an open position. "Maintenance" or "variation" margin is the amount (generally less than initial margin) to which a trader s account may decline before he must deliver additional margin so as to maintain open positions. A margin deposit is like a cash performance bond. It helps assure the futures trader s performance of the futures contracts he purchases or sells. Brokerage firms may require higher amounts of margin versus that required by exchanges as a matter of policy in order to afford further protection for themselves. Margin requirements are computed each day by a commodity broker and the relevant exchange. At the close of each trading day, each open futures contract is marked to market, that is, the gain or loss on the position is calculated from the prior day s close. When the market value of a particular open futures contract position changes to a point where the margin on deposit does not satisfy maintenance margin requirements, a margin call is made by the commodity broker. If the margin call is not met within a reasonable time, the broker may close out the customer s position. Carbon Markets Carbon markets are designed to reduce greenhouse gas ("GHG") emissions and promote sustainable development by putting a price on carbon. Carbon markets are markets where GHG emissions are commodified as a tradable unit either as an emission allowance in government compliance markets or as a verified emission reduction/removal credit in voluntary markets. There are two types of instruments that are traded in carbon markets: carbon credits (sometimes called "Allowances") and carbon offsets. The two main types of carbon markets are compliance carbon markets ("CCMs") and voluntary carbon markets ("VCMs"). Carbon Credit Futures are an expansion of the carbon market. Carbon Credit Futures are credit instruments where the buyer seeks to have exposure to CCMs or VCM market s carbon offset projects, but without directly buying or selling allowances or investing in any projects. CCMs are established by governments and operate under a cap-and-trade system. Cap-and-trade regimes set emission limits (i.e., the right to emit a certain quantity of GHG emissions), which can be allocated or auctioned to the parties in the mechanism up to the total emissions cap. In these types of markets, a regulator will define an allowed maximum level of GHG emissions (the "Cap") for a certain group of entities (e.g., countries, companies, or facilities). The Cap is then subdivided into distinct emission allowances, which are distributed by regulated entities. To stay in compliance with the regulator, the covered entities need to submit one allowance for each ton of carbon dioxide equivalent emitted during a compliance period (usually a year). The initial allocation of allowances to covered entities can be free of charge, partially free, and/or sold at auction by the regulator. Cap-and-trade regimes and related markets are new and based on scientific principles that are subject to debate. Cap-and-trade regimes have arisen primarily due to relative international consensus with respect to scientific evidence indicating a correlative relationship between the rise in global temperatures and extreme weather events, on the one hand, and the rise in GHG emissions in the atmosphere, on the other hand. If this consensus were to break down, cap-and-trade regimes and the value of the Fund may be negatively affected. Scientists are still debating whether the rise in atmospheric GHGs is caused by human activity such as GHG emissions generated through the burning of fossil fuels, as well as the acceptable level of GHG concentrations in the atmosphere. If the science supporting the relationship or the acceptable level of GHG concentrations is discredited or proved to be incorrect or inaccurate, it may negatively affect cap-and-trade regimes and the value of the Fund. There is no assurance that cap-and-trade regimes will continue to exist. Cap-and-trade may not prove to be an effective method of reduction in GHG emissions. As a result or due to other factors, cap-and-trade regimes may be terminated or may not be renewed upon their expiration. New technologies may arise that may diminish or eliminate the need for cap-and-trade markets. Ultimately, the cost of emissions credits is determined by the cost of actually reducing emissions levels. If the price of credits becomes too high, it will be more economical for companies to develop or invest in green technologies, thereby suppressing the demand for credits and adversely affecting the price of the Fund. Emission limit allocations may be larger or smaller than is needed for a stable price of credits and can lead to large price volatility, which could affect the value of the Fund. Depending upon the industries covered under each cap-and-trade mechanism represented in the Index, unpredictable demand for their products and services can affect the value of GHG emissions credits. For example, very mild winters or very cool summers can decrease demand for electric utilities and therefore require fewer carbon credits to offset reduced production and GHG emissions. The ability of the GHG emitting companies to pass on the cost of emissions credits to consumers can affect the price of the Carbon Credit Futures. If the price of emissions can be passed on to the end customer with little impact upon consumer demand, it is likely that industries may continue emitting and purchase any shortfall in the market at the prevailing price. If, however, the producer is unable to pass on the cost, it may be incentivized to reduce production in order to decrease its need for offsetting emissions credits, which could adversely affect the price of carbon credit futures and the Fund. Regulatory risk related to changes in regulation and enforcement of cap-and-trade regimes could also adversely affect market behavior. If fines or other penalties for non-compliance are not enforced, incentives to purchase GHG credits will deteriorate, which could result in a decline in the price of emissions credits and a drop in the value of the Fund. In addition, as cap-and-trade markets develop, new regulation with respect to these markets may arise, which could have a negative effect on the value and liquidity of the cap-and-trade markets and the Fund. In the VCM, often referred to as a "baseline-and-credit" system, a variety of private organizations allows individuals or businesses to purchase offsets from emission reduction or removal projects. In these markets, the private organization defines how emission (reduction or removal) credits can be generated by activities/projects that reduce or remove GHG emissions from the atmosphere compared to a reference scenario (baseline) that reflects the counterfactual situation without such activities. The difference between the baseline emissions and the emissions of the activity determines how many credits can be issued. To generate emission credits, verification of the reduction/removal by an officially recognized institution (a verifier) is necessary to calculate the reduction/removal of emissions into its carbon-dioxide ("CO2") equivalent ("CO2e"). The carbon credit represents one metric-ton of CO2e and can then be used as offsets against mandatory or voluntary GHG emission targets or other policy instruments aiming at GHG mitigation. The Fund will not invest in any Carbon Credit Futures that provide exposure to VCMs. Description of the index The following is a summary of the 7RCC Kaiko Bitcoin Carbon Credit Index. The Index aims to track the financial performance of investing in a portfolio with an 80% allocation to bitcoin and a 20% allocation to Carbon Credit Futures. The purpose of the Index is to obtain exposure to bitcoin for environmentally-focused investors. The Carbon Credit Futures component of the Index is built with a combination of three carbon credit indices: (i) Solactive Future Series European Carbon Credit Rolling Futures Index, which tracks Intercontinental Exchange ("ICE") EUA (Carbon Emission Allowances) futures; (ii) Solactive Future Series California Carbon Rolling Futures Index, which tracks ICE California Carbon Allowance Vintage Future contracts; and (iii) Solactive Futures Series Regional Greenhouse Gas Rolling Futures Index, which tracks ICE RGGI (CO2 allowances) futures contracts. For additional information regarding the Sub-Indexes, see "Investment Objective and Investment Strategy—Principal Investment Strategies—the Index—Carbon Credit Futures Sub-indexes" on page [ ]. The Sub-indexes include only Carbon Credit Futures that mature in the upcoming December. Specifically, each Sub-index includes front-month futures contracts that are rolled over a five-day period prior to the expiration of such contracts in December to new contracts that expire in the December of the subsequent year. The Index does not equally weight its exposure to the Carbon Credit Futures that comprise the Sub-indexes. Rather the Index provides exposure to the reference carbon credits proportional to the trading volume of the back-month Carbon Credit Futures over the last 22 trading days prior to the December rebalancing. As of the date of this prospectus, 11% of the Index is comprised of EU CEA Carbon Credit Futures, 8% of the Index is comprised of CCA Carbon Credit Futures that reference CCA and 1% of the Index is comprised of RGGI Carbon Credit Futures. The Index rebalances quarterly in March, June, September and December. The December rebalance of the Index is the business day immediately following the roll of Carbon Credit Futures for each of the Sub-indexes. Kaiko is the index provider, benchmark administrator and calculates the Bitcoin Price. Kaiko is also the central recipient of input data and evaluates the integrity and accuracy of the input data. Kaiko, founded 2014, is a global crypto data and data solutions company, offering businesses institutional-grade, regulatory-compliant solutions. Kaiko, through Kaiko Indices, a wholly owned subsidiary, is an index provider for crypto assets. Kaiko Indices is a registered Benchmark Administrator under the EU Benchmark Regulations and is regulated by the European Securities and Markets Authority (ESMA). Kaiko crypto asset benchmarks and indices are used by exchanges, asset managers and funds, and other market participants across the world. Solactive is the calculation agent of the Index and is also the index provider of each of the Sub-indexes detailed below. Solactive also calculates the value of the Carbon Credit Futures portion of the Index and the value of the Index overall. Since its creation in 2007, Solactive AG has become one of the key players in the indexing space. Solactive AG is a German multi-asset class index provider focusing on tailor-made indices, developing, calculating and distributing them worldwide. Offering a fast time to market service with great flexibility and at a reasonable cost has allowed Solactive AG to become one of the fastest growing index providers over the past few years. Solactive AG now calculates indices for more than 500 clients in Europe, America and Asia. As of October 2024, approximately $300 billion are invested in products linked to more than 35,000 indices calculated by Solactive AG globally, primarily in the form of 650 ETFs. Performance of the Offered commodity pools operated by the cpo The following performance information is presented in accordance with CFTC regulations. The performance of the Fund will differ materially from the performance of the Related Pools which is included herein. The performance of the Related Pools which is summarized herein is expected to be materially different from the Fund and the past performance summaries of the Related Pools below are generally not representative of how the Fund might perform in the future. No performance information is presented with respect to the Fund, which has not commenced investment operations prior to the date of this Prospectus and which will not begin trading until after the initial Creation Baskets of the Fund are purchased by the initial Authorized Purchaser (all as described in the "Plan of Distribution" section). The performance of the Fund will differ materially from the Related Pools listed below. Performance information is set forth in accordance with CFTC regulations, since each fund s inception of trading. Blueprint Chesapeake Multi-Asset Trend ETF (TICKER: TFPN) Blueprint Chesapeake Multi-Asset Trend ETF commenced trading and investment operations on July 12, 2023. The Fund is listed on NYSE Arca and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 31, 2024): 5,600,000 Aggregate gross sale price for units issued: $151,494,610 Pool NAV as of December 31, 2024: $140,706,872 NAV per Share as of December 31, 2024: $24.69 Worst monthly percentage drawdown*: –3.88% / December 2024 Worst peak to valley drawdown**: –6.4% / May 2024 – October 2024 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2022 2023 2024 January % % 0.18 % February % % 3.44 % March % % 3.15 % April % % (2.18) % May % % 2.72 % June % % (2.95) % July % (0.24)+ % 0.03) % August % (0.04) % (3.50) % September % 0.09 % 1.21 % October % 0.17 % (1.29) % November % (2.09) % 6.81 % December % (0.37) % (3.88) % Annual Rate of Return % (2.48) % 3.19 % + For the partial month beginning July 12, 2023 Cambria Chesapeake Pure Trend ETF (TICKER: MFUT) The Cambria Chesapeake Pure Trend ETF commenced trading and investment operations on May 29, 2024. The Fund is listed on NYSE Arca and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 31, 2024): 1,350,000 Aggregate gross sale price for units issued: $244,028,115 Pool NAV as of December 31, 2024: $22,392,633 NAV per Share as of December 31, 2024: $16.59 Worst monthly percentage drawdown*: -8.84% / October 2024 Worst peak to valley drawdown**: -17.10% / May 2024 – October 2024 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Month 2024 January - February - March - April - May (0.35)+ % June (3.46) % July (3.33) % August (4.22) % September 2.05 % October (8.84) % November 2.01 % December (1.56) % Annual Rate of Return (16.79) % + For the partial month beginning May 29, 2024 CNIC ICE US Carbon Neutral Power Futures Index ETF (TICKER: AMPD) The CNIC ICE US Carbon Neutral Power Futures Index ETF commenced trading and investment operations on May 9, 2023. The Fund is listed on NYSE Arca and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 29, 2024): 200,000 Aggregate gross sale price for units issued: $76,892,925 Pool NAV as of December 31, 2024: $4,023,213 NAV per Share as of December 31, 2024: $20.12 Worst monthly percentage drawdown*: -8.02% / May 2023 Worst peak to valley drawdown: **: -10.15% / October 2023 – December 2023 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2023 2024 January % 2.39 % February % (4.89) % March % 2.18 % April % (.35) % May (8.02) % 2.65 % June 2.74 % (.07) % July 1.85 % (5.59) % August 4.61 % (5.03) % September 0.11 % 1.85 % October 1.41 % (5.34) % November (6.78) % 1.34 % December (3.37) % 2.87 % Annual Rate of Return (7.92) % (7.88) % Ionic Inflation Protection ETF (TICKER: CPII) The Ionic Inflation Protection ETF commenced trading and investment operations on June 29, 2022. The Fund is listed on NYSE Arca and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 29, 2024): 625,000 Aggregate gross sale price for units issued: $12,018,750 Pool NAV as of December 31, 2024: $12,015,924 NAV per Share as of December 31, 2024: $19.23 Worst monthly percentage drawdown*: –2.40% (January 2023) Worst peak to valley drawdown**: -3.15% / October 2023 – December 2023 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2022 2023 2024 January % (2.40) % 1.38 % February % 2.49 % 1.60 % March % (0.25) % 0.02 % April % (0.58) % 3.04 % May % (0.24) % (0.49) % June 0.01 % 0.63 % (0.56) % July 1.06 % 1.23 % (1.12) % August 1.13 % 0.01 % (0.21) % September (2.06) % 2.03 % 0.50 % October 3.08 % 1.33 % 1.75 % November (2.37) % (2.30) % (0.15) % December 0.26 % (0.85) % 1.07 % Annual Rate of Return 1.02 % 1.58 % 6.97 % Return Stacked Bonds & Managed Futures ETF (TICKER: RSBT) The Return Stacked Bonds & Managed Futures ETF commenced trading and investment operations on February 8, 2023. The Fund is listed on CBOE and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 29, 2024): 5,150,000 Aggregate gross sale price for units issued: $89,661,500 Pool NAV as of December 31, 2024: $83,945,611 NAV per Share as of December 31, 2024: $17.41 Worst monthly percentage drawdown*: -7.91% / March 2023 Worst peak to valley drawdown**: -10.39% / February 2023 – May 2023 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2023 2024 January % (2.42) % February (1.08) % 2.71 % March (7.91) % 4.70 % April 0.76 % (0.05) % May (2.24) % 0.11 % June 3.05 % 0.86 % July (0.91) % (1.70) % August (4.14) % (0.15) % September 1.94 % 1.22 % October (2.10) % (8.77) % November (2.06) % 1.63 % December 3.22 % (0.08) % Annual Rate of Return (11.38) % (3.07) % Return Stacked(R) U.S. Stocks & Futures Yield ETF (TICKER: RSSY) The Return Stacked(R) U.S. Stocks & Futures Yield ETF commenced trading and investment operations on May 28, 2024. The Fund is listed on CBOE and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 31, 2024): 7,200,000 Aggregate gross sale price for units issued: $146,304,000 Pool NAV as of December 31, 2024: $147,851,592 NAV per Share as of December 31, 2024: $20.32 Worst monthly percentage drawdown*: -5.34% / October 2024 Worst peak to valley drawdown: -7.50% / June 2024 – October 2024 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2024 January - February - March - April - May 0.26+ % June 4.87 % July (2.80) % August (0.08) % September 0.55 % October (5.34) % November 6.62 % December (1.93) % Annual Rate of Return 1.62 % + For the partial month beginning May 28, 2024 Return Stacked(R) Bonds & Futures Yield ETF (TICKER: RSBY) The Return Stacked(R) Bonds & Futures Yield ETF commenced trading and investment operations on August 20, 2024. The Fund is listed on CBOE and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 31, 2024): 6,050,000 Aggregate gross sale price for units issued: $108,900,000 Pool NAV as of December 31, 2024: $108,025,558 NAV per Share as of December 31, 2024: $18.00 Worst monthly percentage drawdown*: -6.77% / October 2024 Worst peak to valley drawdown**: -8.20% / August 2024 – October 2024 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2024 January - February - March - April - May - June - July - August (1.14)+ % September (0.49 % October (6.77) % November 1.74 % December (1.32) % Annual Rate of Return (7.92) % + For the partial month beginning August 20, 2024 Return Stacked(R) U.S. Stocks & Managed Futures ETF (TICKER: RSST) Return Stacked(R) U.S. Stocks & Managed Futures ETF commenced trading and investment operations on September 6, 2023. The Fund is listed on CBOE and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 31, 2024): 10,825,000 Aggregate gross sale price for units issued: $257,849,364 Pool NAV as of December 31, 2024: $258,057,300 NAV per Share as of December 31, 2024: $23.84 Worst monthly percentage drawdown*: -7.70% / October 2024 Worst peak to valley drawdown**: -18.16% / July 2024 – August 2024 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2023 2024 January 3.91 % February 9.65 % March 6.57 % April (1.69) % May 3.54 % June 3.11 % July (2.78) % August 0.37 % September (2.16)+ 2.32 % October (2.73) (7.70) % November 2.81 6.58 % December 4.00 (0.95) % Annual Rate of Return 1.76 18.32 % + For the partial month beginning September 6, 2023 STKD Bitcoin & Gold ETF (TICKER: BTGD) The STKD Bitcoin & Gold ETF commenced trading and investment operations on October 15, 2024. The Fund is listed on CBOE and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 31, 2024): 975,000 Aggregate gross sale price for units issued: $25,730,250 Pool NAV as of December 31, 2024: $24,410,301 NAV per Share as of December 31, 2024: $26.39 Worst monthly percentage drawdown*: -6.90% / December 2024 Worst peak to valley drawdown**: -7.08% / November 2024 – December 2024 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2024 January - February - March - April - May - June - July - August - September - October 6.39+ % November 33.47 % December (6.90) % Annual Rate of Return 32.20 % +For the partial month beginning October 15, 2024 Unlimited HFND Cayman Subsidiary (TICKER: HFND) The Unlimited HFND Cayman Subsidiary (TICKER: HFND) commenced trading and investment operations on January 3, 2024. The Fund is listed on NYSE Arca and is neither: (i) a privately offered pool pursuant to Section 4(a)(2) of the 1933 Act; (ii) a multi-advisor pool as defined in CFTC Regulation 4.10(d)(2); or (iii) a principal-protected pool as defined in CFTC Regulation 4.10(d)(3). Units of beneficial interest issued (from inception until December 31, 2024): 1,475,000 Aggregate gross sale price for units issued: $95,064,827 Pool NAV as of December 31, 2024: $32,001,356 NAV per Share as of December 31, 2024: $21.69 Worst monthly percentage drawdown*: -2.64% / April 2024 Worst peak to valley drawdown**: -2.68% / March 2024 – April 2024 PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS Rates of Return* Month 2024 January (0.03) % February 1.51 % March 3.38 % April (2.64) % May 2.56 % June 0.05 % July 1.38 % August 0.11 % September 1.88 % October (1.01) % November 3.17 % December (2.07) % Annual Rate of Return 7.94 % See accompanying footnotes and explanatory information below * The monthly rate of return is calculated by dividing the ending NAV of a given month by the ending NAV of the previous month, subtracting 1 and multiplying this number by 100 to arrive at a percentage increase or decrease. Draw-down: Losses experienced over a specified period. Draw-down is measured on the basis of monthly returns only and does not reflect intra-month figures. Worst Monthly Percentage Draw-down: The largest single month loss sustained since inception of trading. Worst Peak-to-Valley Draw-down: The largest percentage decline in the NAV per share over the history of the fund. This need not be a continuous decline but can be a series of positive and negative returns where the negative returns are larger than the positive returns. Worst Peak-to-Valley Draw-down represents the greatest cumulative percentage decline in month-end per share NAV that is not equaled or exceeded by a subsequent month-end per share NAV. Management s discussion and analysis of financial condition and results of operations The Fund is newly formed and has no operating history. Charges Breakeven Analysis The breakeven analysis set forth below is a hypothetical illustration of the approximate dollar returns and percentage returns for the redemption value of a single Share to equal the amount invested twelve months after the investment is made. For purposes of this breakeven analysis, an initial selling price of $25.00 per Share, is assumed. The breakeven analysis is an approximation only and assumes a constant month-end NAV. In order for a hypothetical investment in Shares to breakeven over the next 12 months, assuming a selling price of $25.00 per Share, the investment would have to generate a 0.16% or $0.04 return. The numbers in the chart below have been rounded to the nearest 0.01. Per Share Assumed initial selling price per Share(1) $25.00 Management Fee(2) $(0.17) Estimated Brokerage Commissions and Fees(3) $(0.04) Other Fund Fees and Expenses(4) $— Interest and Other Income(5) $0.17 Amount of trading income (loss) required for the redemption value at the end of one year to equal the selling price of the Share $(0.04) Percentage of initial selling price per Share(6) (0.16)% (1)The breakeven analysis set forth in this table assumes that the Shares have a constant NAV equal to the amount shown. This amount is the expected NAV of the Shares on the first day of Fund operations. The actual NAV of the Fund differs and is likely to change on a daily basis. The numbers provided in this chart have been rounded to the nearest 0.01. The breakeven analysis reflects all fees and expenses, including estimated rebalancing expenses that are anticipated to be incurred by the Trust during a year of an investor s investment. (2)From the Management Fee, the Sponsor pays certain of the routine operational, administrative and other ordinary expenses of the Fund, generally as determined by the Sponsor, including but not limited to, fees and expenses of the Administrator, Sub-Administrator, Bitcoin Custodian, Non-Digital Custodian, Marketing Agent, Transfer Agent, licensors, accounting and audit fees and expenses, tax preparation expenses, legal fees, ongoing SEC registration fees, and report preparation and mailing expenses. These fees and expenses are not included in the breakeven table because they are paid for by the Sponsor through the proceeds from the Management Fee. (3)Reflects estimated brokerage commissions and fees in relation to the Carbon Credit Futures and reflected on a per trade basis. The actual amount of brokerage commissions and trading fees to be incurred will vary based upon the trading frequency of the Fund. The Sponsor may elect to pay or waive a portion of these fees. The Fund may elect to waive fees in order to reduce the Fund s expenses. Investors may pay customary brokerage commissions in connection with purchases of the Shares. Because such brokerage commission rates will vary from investor to investor, such brokerage commissions have not been included in the Breakeven Table. Investors are encouraged to review the terms of their brokerage accounts for applicable charges. (4)The Fund pays all transaction related fees and expenses charged in connection with trading activities for the Fund s investments and for maintenance of its CFTC regulatory status as a commodity pool. The Fund also pays all of its non-recurring and unusual fees and expenses, if any, as determined by the Sponsor. Non-recurring and unusual fees and expenses are unexpected or unusual in nature, such as legal claims and liabilities and litigation costs or indemnification or other unanticipated expenses. Extraordinary fees and expenses also include material expenses which are not currently anticipated obligations of the Fund. Routine operational, administrative and other ordinary expenses are not deemed extraordinary expenses. (5)The Fund seeks to earn interest and other income in high credit quality, short-duration instruments or deposits associated with the pool s cash management in connection with its investments in futures contracts and other financial instruments, that may be used to offset expenses. These investments may include, but are not limited to, short-term Treasury Securities, demand deposits, and money market funds. Considering various uncertain factors in the US and commodity markets, the Sponsor has estimated a blended interest rate of 4.50%. The actual rate may vary and not all assets within the Fund will necessarily earn interest. The actual rate may vary and not all assets of the Fund will earn interest. (6)This represents the estimated approximate percentage for the redemption value of a hypothetical initial investment in a single Share equal to the amount invested twelve months after the investment was made. The estimated approximate percentage of selling price is 0.16% or $0.04 per share. Management Fee The Fund pays the Sponsor a management fee (the "Management Fee"), monthly in arrears, in an amount equal to 0.68% per annum of the daily NAV of the Fund. The Management Fee is paid in consideration of the Sponsor s services related to the management of the Fund s business and affairs. No other management fee is paid by the Fund. The Management Fee is paid in consideration of the Sponsor s trading advisory services and the other services provided to the Fund that the Sponsor pays directly. From the Management Fee, the Sponsor is responsible for paying certain fees and expenses of the Administrator, Trustee, Marketing Agent, Transfer Agent, and certain routine operational, administrative and other ordinary expenses of the Fund. These fees and expenses are not included in the Breakeven Table. The Fund pays all transaction-related fees and expenses charged in connection with the trading activities for the Fund s investments and for maintenance of its CFTC regulatory status as a commodity pool. Licensing and Index Calculation Fee The Fund pays a fee to Kaiko to administer and maintain the Index. Recurring and Non-Recurring Fees and Expenses/Other Fund-Assumed Fees and Expenses The Fund pays all of its non-recurring and unusual fees and expenses, if any, as determined by the Sponsor. Non-recurring and unusual fees and expenses which are unexpected or unusual in nature, such as legal claims and liabilities and litigation costs or indemnification or other unanticipated expenses. Extraordinary fees and expenses also include material expenses which are not currently anticipated obligations of the Fund. Routine operational, administrative and other ordinary expenses are not deemed extraordinary expenses. In addition, as noted below, the Fund pays all transaction-related fees and expenses charged in connection with trading activities for the Fund s investments. Further, the Fund pays all fees and expenses required for maintenance of its CFTC regulatory status as a commodity pool. Selling Commission Retail investors may purchase and sell Shares through traditional brokerage accounts. Investors are expected to be charged a customary commission by their brokers in connection with purchases of Shares that will vary from investor to investor. Investors are encouraged to review the terms of their brokerage accounts for applicable charges. The price at which an Authorized Purchaser sells a Share may be higher or lower than the price paid by such Authorized Purchaser in connection with the creation of such Share in a Creation Unit. Brokerage Commissions and Fees The Fund pays all of its respective brokerage commissions, including applicable exchange fees, NFA fees and give-up fees, pit brokerage fees and other transaction related fees and expenses charged in connection with trading activities for the Fund s investments in CFTC regulated investments. The Fund bears other transaction costs including the effects of trading spreads and financing costs/fees, if any, associated with the use of Carbon Credit Futures, and costs relating to the purchase of money market instruments. USE OF PROCEEDS The Fund uses the proceeds of the offering of Shares of the Fund to make investments in a manner consistent with its investment objective. Proceeds received by the Fund from the issuance of Baskets will be used to acquire bitcoin and Carbon Credit Futures. Such deposits of cash are held by the Non-Digital Custodian on behalf of the Fund until (i) transferred to the Bitcoin Custodian and used to acquire bitcoin; (ii) transferred to an FCM to facilitate the Fund s investment in Carbon Credit Futures; (iii) accrued and distributed to pay fees due to the Sponsor and Fund expenses and liabilities not assumed by the Sponsor, (iv) distributed to Authorized Purchasers in connection with redemptions of Baskets, or (v) disposed of in a liquidation of the Fund. When transacting in Carbon Credit Futures, the expenses due to the Sponsor for the Management Fee and other Fund expenses are not considered when determining the number of Carbon Credit Futures to purchase or sell. In connection with receipt of a Purchase Order (as defined below) accepted by the Marketing Agent and Transfer Agent, the Sponsor, on behalf of the Fund, is responsible for acquiring bitcoin and increasing its investment in Carbon Credit Futures in an amount equal to the value of the Basket. The proceeds will be allocated between the Bitcoin Custodian and the Non-Digital Custodian in accordance with the Fund s investment strategies. The Bitcoin Trading Counterparties with which the Sponsor will engage in bitcoin transactions are unaffiliated third-parties and all transactions will be done on an arms-length basis. When seeking to purchase bitcoin on behalf of the Fund, the Sponsor will seek to purchase bitcoin at a price as close to the Bitcoin Price as practical from any of the approved Bitcoin Trading Counterparties. Once agreed upon, the transaction will generally occur on an "over-the-counter" basis. Transfers to and from the Fund of bitcoin are "on-chain" transactions represented on the Bitcoin blockchain. Transfer fees with respect to this on-chain transfer of bitcoin are paid by the Bitcoin Custodian. The Bitcoin Trading Counterparty must deposit the required amount of bitcoin by end of day Eastern Time on the business day following the Purchase Order Date prior to any movement of cash from the Non-Digital Custodian or delivery of Shares from the Transfer Agent. Upon receipt of the deposit amount of bitcoin at the Bitcoin Custodian from the Bitcoin Trading Counterparty, the Bitcoin Custodian will notify the Sponsor that the bitcoin has been received. The Sponsor will then notify the Transfer Agent that the bitcoin has been received, and the Transfer Agent will direct DTC to credit the number of Shares ordered to the Authorized Purchaser s DTC account and will wire the cash previously sent by the Authorized Purchaser to the Bitcoin Trading Counterparty to complete settlement of the Purchase Order and the acquisition of the bitcoin by the Fund. With respect to the Fund s investments in Carbon Credit Futures, The Sponsor causes the Fund to transfer the proportional amount of proceeds of the sale of Creation Baskets to the Non-Digital Custodian or another financial institution for use in trading activities and/or investment in Carbon Credit Futures and cash and cash equivalents. When the Fund purchases Carbon Credit Futures, the Fund is required to deposit with the FCM on behalf of the exchange a portion of the value of the contract or other interest as security to ensure payment for the obligation under the Carbon Credit Futures at maturity. This deposit is known as initial margin. The Sponsor invests the Fund s assets that remain after margin and collateral is posted in cash and cash equivalents. Subject to these margin and collateral requirements, the Sponsor has sole authority to determine the percentage of assets that will be: (i) held as margin or collateral with the FCM or other custodian; (ii) used for other investments; and (iii) held in bank accounts to pay current obligations and as reserves. In general, the Fund expects that it will be required to post approximately 10% to 20% of the notional amount of a Carbon Credit Future as initial margin when entering into such contract. Ongoing margin and collateral payments will generally be required based on changes in the value of the Carbon Credit Futures. Cash and cash equivalents held by the Fund constitute reserves that are available to meet ongoing margin and collateral requirements. All interest or other income is used for the Fund s benefit. An FCM, counterparty, government agency or commodity exchange could increase margin or collateral requirements applicable to the Fund to hold trading positions at any time. Moreover, margin is merely a security deposit and has no bearing on the profit or loss potential for any positions held. The Fund s assets that are used to post the approximate 10% to 20% of notional value for margin held by the FCM are held in segregation pursuant to the CEA and CFTC regulations. For purposes of creation and redemption orders for Carbon Credit Futures, the settlement price on the primary exchange will be used. In connection with a Redemption Order (as defined below), the Sponsor, on behalf of the Fund, is responsible for selling bitcoin and Carbon Credit Futures in an amount equal to the value of the Basket. When seeking to sell bitcoin, the Sponsor will seek to sell bitcoin at prices as close to the Bitcoin Price as practical on terms from any of the approved Bitcoin Trading Counterparties. Once agreed upon, the transaction will generally occur on an "over-the-counter" basis. The Bitcoin Custodian will not send the required amount of bitcoin until the Non-Digital Custodian has received the cash from the Bitcoin Trading Counterparty and is instructed by the Sponsor to make such transfer. Once the Bitcoin Trading Counterparty has sent the cash to the Non-Digital Custodian in an agreed upon amount to settle the agreed upon sale of the Basket Amount of bitcoin, the Transfer Agent will notify the Sponsor. The Sponsor will then notify the Bitcoin Custodian to transfer the bitcoin to the Bitcoin Trading Counterparty, and the Transfer Agent will facilitate the Shares in exchange for cash. Once the Authorized Purchaser has delivered the Shares represented by the Basket to be redeemed to the Fund s DTC account, the Non-Digital Custodian will wire the requisite amount of cash to the Authorized Purchaser. Each Bitcoin Trading Counterparty must be approved by the Sponsor. The Sponsor has instituted a process for approving and monitoring Bitcoin Trading Counterparties. All bitcoin trading counterparties must be approved by the Sponsor before the Sponsor, on behalf of the Trust, will engage in transactions with the entity. The Sponsor continuously reviews all approved Bitcoin Trading Counterparties and will reject the approval of any previously approved Bitcoin Trading Counterparty if new information arises regarding the entity that puts the appropriateness of that entity as an approved Bitcoin Trading Counterparty in doubt. Pursuant to this process, the Sponsor has approved each of JSCT, LLC (which is an affiliate of Jane Street Capital, LLC an Authorized Purchaser for the Fund), DV Chain, LLC and Gemini to act as a Bitcoin Trading Counterparty. Bitcoin Trading Counterparties may be added at any time, subject to the discretion of the Sponsor. Who may subscribe Only Authorized Purchasers may create or redeem Baskets. Each Authorized Purchaser must (1) be a registered broker-dealer or other securities market participant such as a bank or other financial institution which is not required to register as a broker-dealer to engage in securities transactions, (2) be a member of a national clearing agency, and (3) have entered into an agreement with the Sponsor (an Authorized Purchaser Agreement). DESCRIPTION OF CREATION AND REDEMPTION OF SHARES When the Fund creates or redeems its Shares, it will do so only in Baskets (blocks of 10,000 Shares) based on the NAV per Share (net of accrued but unpaid expenses and liabilities) multiplied by the number of Shares comprising a Basket (10,000). This is called the "Basket Price." The Fund will sell its assets (in the case of redemption orders) or allocate proceeds (in the case of creation orders) in accordance with the assets of the Index. Stated differently, the Sponsor will facilitate the liquidation of an amount of bitcoin and Carbon Credit Futures that will, in aggregate cover the sufficient assets necessary redemption order or invest the proceeds from a creation order in bitcoin and Carbon Credit Futures, in each instance so that the Fund will continue to track the Index s 80% allocation in bitcoin and 20% allocation in Carbon Credit Futures. With respect to Carbon Credit Futures, the Sponsor will instruct the liquidation or acquisition of each component Carbon Credit Future in accordance with the weighting of the Index (i.e., to maintain the weighting reflected in the Index of Carbon Credit Futures referencing EU ETS, CCA and RGGI). The Sponsor will retain discretion to determine which of the Custodians, to the extent there are multiple custodians for bitcoin or multiple custodians for cash and cash equivalents in connection with Carbon Credit Futures, are selected to facilitate the respective order. Authorized Purchasers are the only persons that may place orders to create and redeem Baskets. Authorized Purchasers must be (1) registered broker-dealers or other securities market participants, such as banks and other financial institutions, that are not required to register as broker-dealers to engage in securities transactions described below, and (2) DTC Participants. To become an Authorized Purchaser, a person must enter into an Authorized Purchaser Agreement. The Authorized Purchaser Agreement provides the procedures for the creation and redemption of Baskets and for the delivery of the cash or Shares required for such creation and redemptions. The Authorized Purchaser Agreement and the related procedures attached thereto may be amended by the Fund, without the consent of any Shareholder or Authorized Purchaser. Authorized Purchasers must pay the Transfer Agent a non-refundable fee for each order they place to cover the expenses incurred in connection with the creation and redemption of Baskets. The transaction fee may be waived, reduced, increased or otherwise changed by the Sponsor in its sole discretion. Authorized Purchasers who make deposits with the Fund in exchange for Baskets receive no fees, commissions or other form of compensation or inducement of any kind from either the Fund or the Sponsor, and no such person will have any obligation responsibility to the Sponsor or the Fund to effect any sale or resale of Shares. Each Authorized Purchaser will be required to be registered as a broker-dealer under the Exchange Act and a member in good standing with FINRA, or exempt from being or otherwise not required to be licensed as a broker-dealer or a member of FINRA, and will be qualified to act as a broker or dealer in the states or other jurisdictions where the nature of its business so requires. Certain Authorized Purchasers may also be regulated under federal and state banking laws and regulations. Each Authorized Purchaser has its own set of rules and procedures, internal controls and information barriers as it determines is appropriate in light of its own regulatory regime. Under the Authorized Purchaser Agreement, the Sponsor, and the Fund under limited circumstances, have agreed to indemnify the Authorized Purchasers against certain liabilities, including liabilities under the Securities Act, and to contribute to the payments the Authorized Purchasers may be required to make in respect of those liabilities. In connection with any issuance or redemption of a Creation Basket, the Fund deploys assets or liquidates assets, as applicable, in proportion with the Fund s holdings such that it maintains an 80%/20% ratio of bitcoin and Carbon Credit Futures. In the case of the issuance of a Creation Basket, the Fund will allocation 80% of the proceeds from such Creation Basket and 20% of the proceeds to Carbon Credit Futures in proportion to those represented in the Index. A portion of the assets attributable to the Carbon Credit Futures will be deposited with the FCM, and the remainder would remain deployed in connection with purchasing notional exposure to the respective Carbon Credit Futures in proportion to their weights in the Index. In the case of the redemption of a Creation Basket, the Fund will raise sufficient assets to meet such redemption request. Accordingly, the Sponsor would instruct the sale of bitcoin to represent 80% of such necessary assets, and reduce notional exposure to the applicable Carbon Credit Futures to cover the remaining 20% of such necessary assets. Such notional exposure would be reduced in proportionate amounts to maintain the proper exposure to the Index weights. After such liquidation, the Fund s holdings would maintain its 80%/20% ratio to bitcoin and Carbon Credit Futures. See "Investment Objective and Investment Strategy—Principal Investment Strategies—Carbon Credit Futures" for additional information. The following description of the procedures for the creation and redemption of Baskets is only a summary and an investor should refer to the relevant provisions of the Trust Agreement and the form of Authorized Purchaser Agreement for more detail. The Trust Agreement and form of Authorized Purchaser Agreement are filed as exhibits to the registration statement of which this prospectus is a part. Determination of Basket Price The Basket Price required to create each Basket changes from day to day. On each day that the Exchange is open for regular trading, the Administrator adjusts the Basket Price as appropriate to reflect accrued expenses. The computation is made by the Administrator each business day prior to the commencement of trading on the Exchange. The Basket Price so determined is communicated to all Authorized Purchasers and made available on the Trust s website for the Shares. The Exchange also publishes the Basket Price determined by the Administrator as indicated above. Creation Procedures The manner by which creations are made is dictated by the terms of the Authorized Purchaser Agreement. On any business day, an Authorized Purchaser may create Shares by placing an order to purchase one or more Baskets with the Transfer Agent through the Marketing Agent in exchange for cash (a "Purchase Order"). Such orders are subject to approval by the Marketing Agent and Transfer Agent and may be received: (i) in writing by facsimile; (ii) through the Transfer Agent s electronic order entry system; or (iii) by telephone to the Administrator at the Transfer Agent according to certain additional procedures. Such orders are subject to approval by the Marketing Agent and Transfer Agent. For purposes of processing creation and redemption orders, a "business day" means any day other than a day when the Exchange is closed for regular trading. Purchase Orders must be placed by 2:00 p.m., eastern time, or the close of regular trading on the Exchange, whichever is earlier (the "Order Cut-Off Time"), or an earlier time as determined and communicated by the Sponsor and its agent. The day on which a Purchase Order is accepted by the Transfer Agent is considered the "Purchase Order Date." If the Purchase Order is accepted, it will receive the next Business Day s Basket Price if submitted before the applicable Order Cutoff Time. By placing a Purchase Order, an Authorized Purchaser agrees to deposit cash as determined by the Sponsor with the Fund s Non-Digital Custodian. The total deposit required to create each basket ("Creation Basket Deposit") will be an amount of cash that is in the same proportion to the total assets of the Fund (net of estimated accrued but unpaid fees, expenses and other liabilities) on the date the Purchase Order is properly received as the number of Shares to be created under the Purchase Order is in proportion to the total number of Shares outstanding on the date the Purchase Order is received. The Sponsor, through the Transfer Agent, shall notify the Authorized Purchaser of the amount of cash to be included in deposits to create Baskets by e-mail or telephone correspondence and such amount will be available via the Fund s website. An Authorized Purchaser who places a Purchase Order is responsible for transferring to the Fund s account with the Non-Digital Custodian the required amount of cash by the end of the next Business Day following the Purchase Order Date (T+1) or as agreed to by the Authorized Purchaser, Sponsor, Marketing Agent and Transfer Agent in advance of when the Purchase Order is placed. Prior to the delivery of Baskets for a Purchase Order, the Authorized Purchaser must also have submitted via CNS the non-refundable transaction fee due for the Purchase Order. Upon receipt of the deposit amount, the Administrator will cause DTC to credit the number of Baskets ordered to the Authorized Purchaser s DTC account. The Sponsor may in its sole discretion limit the number of Shares created pursuant to Purchase Orders on any specified day without notice to the Authorized Purchasers and may direct the Marketing Agent to reject any Purchase Orders in excess of such capped amount. The Sponsor may choose to limit the number of Shares created pursuant to Purchase Orders when it deems so doing to be in the best interest of Shareholders. It may choose to do so when it believes the market is too volatile to execute a bitcoin transaction, when it believes the price of bitcoin is being inconsistently, irregularly, or discontinuously published from bitcoin trading venues and other data sources, or when it believes other similar circumstances may create a scenario in which accepting Purchase Orders would not be in the best interests of the Shareholders. The Sponsor does not believe that the Fund s ability to arrive at such a determination will have a significant impact on the Shares in the secondary market because it believes that the ability to create Shares would be reinstated shortly after such determination is made, and any entity desiring to create Shares would be able to do so once the ability to create Shares is reinstated. However, it is possible that such a determination would cause the Shares to trade at premiums or discounts relative to the Fund s NAV on the secondary market if arbitrageurs believe that there is risk that the creation and redemption process is not available, as this process is a component of keeping the price of the Shares on the secondary market closely aligned to the Fund s NAV. Rejection of Purchase Orders The Sponsor or the Marketing Agent reserve the absolute right to reject acceptance of a Purchase Order if: it determines that, due to position limits or otherwise, investment alternatives that will enable a Fund to meet its investment objective are not available to the Fund at that time; it determines that the Purchase Order is not in proper form; it believes that acceptance would have adverse tax consequences to the Fund or the Shareholders; the acceptance or receipt of a Creation Basket Deposit would, in the opinion of legal counsel to the Sponsor, be unlawful; or if circumstances outside the control of the Sponsor, the Marketing Agent or the Non-Digital Custodian make it for all practical purposes not feasible to process creations of Creation Baskets. None of the Sponsor, the Marketing Agent, the Non-Digital Custodian or the Bitcoin Custodian will be liable for the rejection of any Purchase Order. The Marketing Agent shall notify the Authorized Purchaser of a rejection or revocation of any Purchase Order, however it is under no duty to give notification of any specific defects or irregularities in the delivery of the Creation Basket Deposit, nor shall the Marketing Agent or the Fund incur any liability for the failure to give any such notification. The Fund and Marketing Agent may not revoke a previously accepted Purchase Order. Redemption Procedures On any business day, an Authorized Purchaser may place an order with the Transfer Agent to redeem one or more Baskets (a "Redemption Order"). Redemption Orders must be placed by 2:00 p.m. eastern time (the "Redemption Order Cut-Off Time"), or the close of regular trading on the Exchange, whichever is earlier. A Redemption Order will be effective on the date it is accepted by the Transfer Agent ("Redemption Order Date"). By placing a Redemption Order, an Authorized Purchaser agrees to deliver the Redemption Basket to be redeemed through DTC s book-entry system to the Fund s account with the Non-Digital Custodian not later than the end of the next Business Day following the effective date of the Redemption Order ("Redemption Distribution Date") or the end of such later Business Day as agreed to by the Authorized Purchaser and the Transfer Agent in advance of when the Redemption Order is placed. Failure to consummate such delivery shall result in the cancellation of the order. Prior to the delivery of the redemption distribution for a Redemption Order, the Authorized Purchaser must also have submitted via CNS or such other means deemed acceptable by the Sponsor, the non-refundable Transaction Fee due for the Redemption Order. The redemption distribution due from the Fund is delivered to the authorized Purchaser on the Redemption Distribution Date if the Fund s DTC account has been credited with the Baskets to be redeemed pursuant to the terms of the Authorized Purchaser Agreement. That notwithstanding, no such distribution shall be made until the Non-Digital Custodian has received the cash necessary from selling the Fund s bitcoin to effectuate the Redemption Basket from the Bitcoin Trading Counterparty. The Bitcoin Custodian will not send the requisite amount of bitcoin until the Non-Digital Custodian has received the cash from the Bitcoin Trading Counterparty and is instructed by the Sponsor to make such transfer. Once the Bitcoin Trading Counterparty has sent the cash to the Non-Digital Custodian in an agreed upon amount to settle the agreed upon sale, the Transfer Agent will notify the Sponsor, who will in turn notify the Bitcoin Custodian to transfer the bitcoin to the Bitcoin Trading Counterparty. The Transfer Agent will then facilitate the Shares in exchange for cash. Once the Authorized Purchaser has delivered the Shares represented by the Basket to be redeemed to the Fund s DTC account, the Non-Digital Custodian will wire the requisite amount of cash to the Authorized Purchaser. If the Fund s DTC account has not been credited with all of the Shares of the Basket to be redeemed, the redemption distribution will be delayed until such time as the Transfer Agent confirms receipt of all such Shares. If the Bitcoin Trading Counterparty fails to deliver the cash to the Non-Digital Custodian, the transaction will be cancelled, and no transfer of bitcoin or Shares will occur. Suspension or Rejection of Redemption Orders The Sponsor may, in its discretion, suspend the right of redemption, or postpone the redemption settlement date, (1) for any period during which the Exchange is closed other than customary weekend or holiday closings, or trading on the Exchange is suspended or restricted, (2) for any period during which an emergency exists as a result of which delivery, disposal or evaluation of [Treasuries] is not reasonably practicable (for example, as a result of a significant technical failure, power outage, or network error), or (3) for such other period as the Sponsor determines to be necessary for the protection of the Shareholders. None of the Sponsor, the Marketing Agent, Non-Digital Custodian or the Bitcoin Custodian will be liable to any person or in any way for any loss or damages that may result from any such suspension or postponement. Redemption Orders must be made in whole Baskets. The Sponsor or the Marketing Agent reserve the absolute right to reject acceptance of a Redemption Order if: it is determined by the Sponsor or Marketing Agent to not be in the proper form; the fulfillment of which its counsel advises might be unlawful; or if the number of Shares being redeemed would reduce the remaining outstanding Shares below 50,000 Shares (i.e., five baskets of 10,000 Shares each) or less, unless the Sponsor has reason to believe that the placer of the redemption order does in fact possess all the outstanding Shares of the Fund and can deliver them. With respect to the suspension of creation or redemption orders, such suspension may cause to price of the Shares to deviate more significantly from the Fund s NAV per Share than would be the case if such suspension had not occurred. The Fund will notify Shareholders of any such suspension in a prospectus supplement and/or a current report on Form 8-K or in its annual or quarterly reports. Creation and Redemption Transaction Fee To compensate the Transfer Agent for expenses incurred in connection with the creation and redemption of Baskets, an Authorized Purchaser is required to pay a transaction fee to the Transfer Agent to create or redeem Baskets, which does not vary in accordance with number of Baskets in such order. The transaction fee may be reduced, increased or otherwise changed by the Sponsor. As of the date of this prospectus, the transaction fee is $300 and is payable in cash. Tax Responsibility Authorized Purchasers are responsible for any transfer tax, sales or use tax, stamp tax, recording tax, value added tax or similar tax or governmental charge applicable to the creation or redemption of Baskets, regardless of whether or not such tax or charge is imposed directly on the Authorized Purchaser, and agree to indemnify the Sponsor and the Fund if they are required by law to pay any such tax, together with any applicable penalties, additions to tax and interest thereon. Secondary Market Transactions As discussed above, Authorized Purchasers are the only persons that may place orders to create and redeem Baskets. Authorized Purchasers must be registered broker-dealers or other securities market participants, such as banks and other financial institutions that are not required to register as broker-dealers to engage in securities transactions. An Authorized Purchaser is under no obligation to create or redeem Baskets, and an Authorized Purchaser is under no obligation to offer to the public Shares of any Basket it does create. Authorized Purchasers that do offer to the public Shares from the Basket they create will do so at per-Share offering prices that are expected to reflect, among other factors, the trading price of the Shares on the Exchange, the NAV of the Fund at the time the Authorized Purchaser purchased the Baskets, the NAV of the Shares at the time of the offer of the Shares to the public, the supply of and demand for Shares at the time of sale, and the liquidity of the Fund s investments. Baskets are generally expected to be redeemed when the price per Share is at a discount to the per Share NAV. Shares initially comprising the same Basket but offered by Authorized Purchasers to the public at different times may have different offering prices. An order for one or more Baskets may be placed by an Authorized Purchaser on behalf of multiple clients. Authorized Purchasers who make deposits of cash with the Fund in exchange for Baskets receive no fees, commissions or other forms of compensation or inducement of any kind from either the Fund or the Sponsor and no such person has any obligation or responsibility to the Sponsor or the Fund to effect any sale or resale of Shares. Shares are expected to trade in the secondary market on the Exchange. Shares may trade in the secondary market at prices that are lower (i.e., a discount) or higher (i.e., a premium) relative to their NAV per Share. The amount of the discount or premium in the trading price relative to the NAV per Share may be influenced by various factors, including the number of investors who seek to purchase or sell Shares in the secondary market and the liquidity of the Fund s investments. Additional Information about the trust Description of the Trust The Trust is a Delaware Statutory Trust that was formed on February 10, 2023, by the filing of the Certificate of Trust with the Delaware Secretary of State in accordance with the provisions of the Delaware Statutory Trust Act ("DSTA"). The Trust operates pursuant to the Trust Agreement, which is the "governing instrument" of the Trust under the laws of the State of Delaware. The Fund is a separate series of the Trust. The Fund is a passively managed fund and does not pursue active management investment strategies. The Sponsor does not actively manage the assets held by the Fund, including its holding of bitcoin. The Sponsor believes that the Fund will provide a cost-efficient way for investors to implement strategic and tactical asset allocation strategies that use bitcoin by investing in the Shares rather than purchasing, holding and trading bitcoin directly, while simultaneously providing exposure to Carbon Credit Futures. The Trust is not registered as an investment company under the Investment Company Act and the Sponsor believes that the Trust is not required to register under the Investment Company Act. The Trust or, as the case may be, the Fund may dissolve at any time if the Trust is required to be registered as an investment company under the Investment Company Act. The Fund is a commodity pool for purposes of the CEA. As a result, the Fund and Sponsor are each subject to regulation thereunder. The Trust has no fixed termination date and shall terminate pursuant to the provisions of the Trust Agreement or as otherwise provided by law. Description of the Trust Agreement The following is a description of the material terms of the Trust Agreement. The Trust Agreement establishes the roles, rights and duties of the Sponsor and the Trustee. The following discussion is qualified in its entirety by reference to the Trust Agreement. Voting Rights Shareholders have no voting rights with respect to the Trust or the Fund except as expressly provided in the Trust Agreement. The Trust Agreement provides that Shareholders representing at least a majority (over 50%) of the outstanding Shares of the Fund together as a single class(excluding Shares acquired by the Sponsor in connection with its initial capital contribution to any Trust series) may vote to (i) continue the Trust by electing a successor Sponsor as described above, and (ii) approve amendments to the Trust Agreement that impair the right to surrender Redemption Baskets for redemption. (Trustee consent to any amendment to the Trust Agreement is required if the Trustee reasonably believes that such amendment adversely affects any of its rights, duties or liabilities.) In addition, Shareholders holding Shares representing seventy-five percent (75%) of the outstanding Shares of the Fund, voting together as a single class (excluding Shares acquired by the Sponsor in connection with its initial capital contribution to any Trust series) may vote to dissolve the Trust upon not less than ninety (90) days notice to the Sponsor. Liability of Covered Persons and Indemnification Under the Trust Agreement, the Sponsor, the Trustee and their respective Affiliates (collectively, "Covered Persons") shall have no liability to the Trust, the Fund, or to any Shareholder for any loss suffered by the Trust or the Fund which arises out of any action or inaction of such Covered Person if such Covered Person, in good faith, determined that such course of conduct was in the best interest of the Trust or the Fund and such course of conduct did not constitute gross negligence or willful misconduct of such Covered Person. Subject to the foregoing, neither the Sponsor nor any other Covered Person shall be personally liable for the return or repayment of all or any portion of the capital or profits of any Shareholder or assignee thereof, it being expressly agreed that any such return of capital or profits made pursuant to the Trust Agreement shall be made solely from the assets of the Fund without any rights of contribution from the Sponsor or any other Covered Person. A Covered Person shall not be liable for the conduct or willful misconduct of any administrator or other delegate selected by the Sponsor with reasonable care, provided, however, that the Trustee and its Affiliates shall not, under any circumstances be liable for the conduct or willful misconduct of any administrator or other delegate or any other person selected by the Sponsor to provide services to the Trust. The payment of any indemnification shall be allocated, as appropriate, among the Trust s series. Unless such indemnification expense is specifically attributable to a series of the Trust, or arises out of the operations of a series of the Trust, any such indemnification payment will be allocated by the Sponsor using a pro rata methodology that allocates certain Trust expenses among the Trust s series. The Trust and its series shall not incur the cost of that portion of any insurance which insures any party against any liability, the indemnification of which is prohibited under the Trust Agreement. Expenses incurred in defending a threatened or pending action, suit or proceeding against the Sponsor shall be paid by the Trust in advance of the final disposition of such action, suit or proceeding, if (i) the legal action relates to the performance of duties or services by the Sponsor on behalf of the Trust; (ii) the legal action is initiated by a party other than the Trust; and (iii) the Sponsor undertakes to repay the advanced funds with interest to the Trust in cases in which it is not entitled to indemnification. The Trust Agreement also provides that the Sponsor shall be indemnified by the Trust (or by a series separately to the extent the matter in question relates to a single series or disproportionately affects a specific series in relation to other series) against any losses, judgments, liabilities, expenses (excluding any taxes on the compensation received for services as Sponsor or on indemnity payments received), and amounts paid in settlement of any claims sustained by it in connection with its activities for the Trust, provided that (i) the Sponsor was acting on behalf of or performing services for the Trust and has determined, in good faith, that such course of conduct was in the best interests of the Trust and such liability or loss was not the result of gross negligence, willful misconduct, or a breach of the Trust Agreement on the part of the Sponsor and (ii) any such indemnification will only be recoverable from the assets of the applicable series. The Sponsor s rights to indemnification permitted under the Trust Agreement shall not be affected by the dissolution or other cessation to exist of the Sponsor, or the withdrawal, adjudication of bankruptcy or insolvency of the Sponsor, or the filing of a voluntary or involuntary petition in bankruptcy under Title 11 of the Bankruptcy Code by or against the Sponsor. Notwithstanding the above, the Sponsor shall not be indemnified for any losses, liabilities or expenses arising from or out of an alleged violation of U.S. federal or state securities laws unless (i) there has been a successful adjudication on the merits of each count involving alleged securities law violations as to the particular indemnitee and the court approves the indemnification of such expenses (including, without limitation, litigation costs), (ii) such claims have been dismissed with prejudice on the merits by a court of competent jurisdiction as to the particular indemnitee and the court approves the indemnification of such expenses (including, without limitation, litigation costs), or (iii) a court of competent jurisdiction approves a settlement of the claims against a particular indemnitee and finds that indemnification of the settlement and related costs should be made. The Trust Agreement provides that the Sponsor and the Trust shall indemnify the Trustee and its successors, assigns, legal representatives, officers, directors, Shareholders, employees, agents and servants (the "Trustee Indemnified Parties") against any liabilities, obligations, losses, damages, penalties, taxes (excluding any taxes on the compensation received for services as Trustee or on indemnity payments received), claims, actions, suits, costs, expenses or disbursements which may be imposed on a Trustee Indemnified Party relating to or arising out of the formation, operation or termination of the Trust, the execution, delivery and performance of any other agreements to which the Trust is a party, or the action or inaction of the Trustee under the Trust Agreement or any other agreement, except for expenses resulting from the gross negligence or willful misconduct of a Trustee Indemnified Party. Further, certain officers of the Sponsor are insured against liability for certain errors or omissions which an officer may incur or that may arise out of his or her capacity as such. In the event the Trust is made a party to any claim, dispute, demand or litigation or otherwise incurs any liability or expense as a result of or in connection with any Shareholder s (or assignee s) obligations or liabilities unrelated to the Trust business, such Shareholder (or assignees cumulatively) is required under the Trust Agreement to indemnify the Trust for all such liability and expense incurred, including attorneys and accountants fees. Fiduciary and Regulatory Duties of the Sponsor and the Trustee The Trust Agreement modifies and restricts the default fiduciary duties and restrictions under Delaware law typically imposed on "fiduciaries" in accordance with the DSTA. Under Delaware law, the general fiduciary duties that would apply to the Sponsor are defined and limited in scope by the Trust Agreement (to which terms all Shareholders, by purchasing Shares, are deemed to consent). That notwithstanding, the Sponsor is a registered investment adviser under the Advisers Act and is subject to the fiduciary duties associated therewith. The Trustee is a fiduciary under the Trust Agreement and must satisfy the requirements of Section 3807 of the Delaware Trust Statute. However, the fiduciary duties, responsibilities and liabilities of the Trustee are limited by, and are only those specifically set forth in, the Trust Agreement. The Trust Agreement provides that in addition to any other requirements of applicable law, a Shareholder may bring a derivative action on behalf of the Trust only if the following conditions are met: (i) the Shareholder or Shareholders must make a pre-suit demand upon the Sponsor to bring the subject action unless an effort to cause the Sponsor to bring such an action is not likely to succeed; and a demand on the Sponsor shall only be deemed not likely to succeed and therefore excused if the Sponsor has a personal financial interest in the transaction at issue, and the Sponsor shall not be deemed interested in a transaction or otherwise disqualified from ruling on the merits of a Shareholder demand by virtue of the fact that the Sponsor receives remuneration for its service as the Sponsor or as a sponsor of one or more companies that are under common management with or otherwise affiliated with the Trust; and (ii) unless a demand is not required under clause (i) of this paragraph, the Sponsor must be afforded a reasonable amount of time to consider such Shareholder request and to investigate the basis of such claim; and the Sponsor shall be entitled to retain counsel or other advisors in considering the merits of the request and may require an undertaking by the Shareholders making such request to reimburse the Trust for the expense of any such advisors in the event that the Sponsor determines not to bring such action. Actions Taken to Protect the Trust The Sponsor is authorized to and may, in its own discretion, prosecute, defend, settle or compromise actions or claims at law or in equity that it considers necessary or proper to protect the Trust or the interests of the Shareholders. The expenses incurred by the Sponsor in connection therewith (including the fees and disbursements of legal counsel) will be expenses of the Trust and are deemed to be Additional Trust Expenses. The Sponsor will be entitled to be reimbursed for the Additional Trust Expenses. Successor Sponsors If the Sponsor is adjudged bankrupt or insolvent, the Trustee may terminate and liquidate the Trust and distribute its remaining assets. Neither the Trustee nor the Administrator has any obligation to appoint a successor sponsor or to assume the duties of the Sponsor and will have no liability to any person because the Trust is or is not terminated as described in the preceding sentence. Withdrawal of the Sponsor The Sponsor may withdraw voluntarily as the Sponsor of the Trust only upon ninety (90) days prior written notice to the holders of the Trust s outstanding Shares and the Trustee. If the withdrawing Sponsor is the last remaining Sponsor, Shareholders holding a majority (over 50%) of the outstanding Shares of the Fund, voting together as a single class (not including Shares acquired by the Sponsor through its initial capital contribution) may vote to elect a successor Sponsor. The successor Sponsor will continue the business of the Trust. Shareholders have no right to remove the Sponsor. In the event of withdrawal, the Sponsor is entitled to a redemption of the Shares it acquired through its initial capital contribution to any of the series of the Trust at their NAV per Share. If the Sponsor withdraws and a successor Sponsor is named, the withdrawing Sponsor shall pay all expenses as a result of its withdrawal. Limitation on Trustee s Liability Under the Trust Agreement, the Sponsor has exclusive control of the management of all aspects of the activities of the Trust and the Trustee has only nominal duties and liabilities to the Trust. The Trustee is appointed to serve as the trustee for the sole purpose of satisfying Section 3807(a) of the DSTA which requires that the Trust have at least one trustee with a principal place of business in the State of Delaware. The duties of the Trustee are limited to (i) accepting legal process served on the Trust in the State of Delaware, (ii) the execution of any certificates required to be filed with the Delaware Secretary of State which the Trustee is required to execute under the DSTA, and (iii) any other duties specifically allocated to the Trustee in the Trust Agreement. To the extent the Trustee has duties (including fiduciary duties) and liabilities to the Trust or the Shareholders under the DSTA, such duties and liabilities will be replaced by the duties and liabilities of the Trustee expressly set forth in the Trust Agreement. The Trustee will have no obligation to supervise, nor will it be liable for, the acts or omissions of the Sponsor, Transfer Agent, Administrator, Custodians or any other person. Neither the Trustee, either in its capacity as trustee or in its individual capacity, nor any director, officer or controlling person of the Trustee is, or has any liability as, the issuer, director, officer or controlling person of the issuer of Shares. The Trustee s liability is limited solely to the express obligations of the Trustee as set forth in the Trust Agreement. Under the Trust Agreement, the Sponsor has the exclusive management, authority and control of all aspects of the activities of the Trust. The Trustee has no duty or liability to supervise or monitor the performance of the Sponsor, nor does the Trustee have any liability for the acts or omissions of the Sponsor. The existence of a trustee should not be taken as an indication of any additional level of management or supervision over the Trust. The Trust Agreement provides that the management authority with respect to the Trust is vested directly in the Sponsor. The Trust Agreement provides that the Trustee is not responsible or liable for the form, character, genuineness, sufficiency, value or validity of any of the assets of the Trust. Holding of Trust Property The Trust will hold and record the ownership of the Fund s assets in a manner such that it will be owned for the benefit of the Fund s Shareholders for the purposes of, and subject to and limited by the terms and conditions set forth in, the Trust Agreement. Other than issuance of the Shares, the Trust will not create, incur or assume any indebtedness or borrow money from or loan money to any person. The Trustee may not commingle its assets with those of any other person. The Trustee may employ agents, attorneys, accountants, auditors and nominees and will not be answerable for the conduct or misconduct of any such custodians, agents, attorneys or nominees if such custodians, agents, attorney and nominees have been selected with reasonable care. Resignation, Discharge or Removal of Trustee; Successor Trustees The Trustee may resign as Trustee by written notice of its election so to do, delivered to the Sponsor with at least 60 days notice. The Sponsor may remove the Trustee in its discretion ; provided, that such resignation shall not become effective unless and until a successor Trustee shall have been appointed by the Sponsor in accordance with Section 2.5 of the Trust Agreement. If the Trustee resigns or is removed, the Sponsor, acting on behalf of the Shareholders, shall appoint a successor trustee. The successor Trustee will become fully vested with all of the rights, powers, duties and obligations of the outgoing Trustee. Amendments to the Trust Agreement The Sponsor may, without the approval of the Shareholders, amend or supplement the Trust Agreement; provided, however, that the Shareholders shall have the right to vote on any amendment (i) if expressly required under Delaware or federal law or regulations or rules of any exchange, (ii) submitted to them by the Sponsor in its sole discretion, or (iii) approve amendments to the Trust Agreement that impair the right to surrender Redemption Baskets for redemption. The Sponsor shall provide notice of any amendment to the Shareholders setting forth the substance of the amendment and its effective date. Upon amendment of the Trust Agreement, the Certificate of Trust shall also be amended, if required by the Delaware Trust Statute, to reflect such change. No amendment shall be made to the Trust Agreement without the consent of the Trustee if it reasonably believes that such amendment adversely affects any of the rights, duties or liabilities of the Trustee. At the expense of the Sponsor, the Trustee shall execute and file any amendment to the Certificate of Trust if so directed by the Sponsor or if such amendment is required in the opinion of the Trustee. The Sponsor shall determine the contents and manner of delivery of any notice of any Trust Agreement amendment. Such notice may be provided on the Fund s website, in a prospectus supplement, through a current report on Form 8-K and/or in the Fund s annual or quarterly reports. The Trustee shall be under no obligation to execute any amendment to the Trust Agreement or to any agreement to which the Trust is a party until it has received an instruction letter from the Sponsor, in form and substance reasonably satisfactory to the Trustee (i) directing the Trustee to execute such amendment, (ii) representing and warranting to the Trustee that such execution is authorized and permitted by the terms of the Trust Agreement and (if applicable) such other agreement to which the Trust is a party and does not conflict with or violate any other agreement to which the Trust is a party and (iii) confirming that such execution and acts related thereto are covered by the indemnity provisions of the Trust Agreement in favor of the Trustee; provided that the Trustee shall in no circumstance be obligated to execute any agreement to which the Trust is a party if the Sponsor may execute such Agreement on behalf of the Trust. No provision of the Trust Agreement may be amended, waived or otherwise modified orally but only by a written instrument adopted in accordance with Section 11 of the Trust Agreement. Termination of the Trust Pursuant to the terms of the Trust Agreement, the Trust will dissolve if any of the following events occur: a certificate of dissolution or revocation of the Sponsor s charter is filed (and 90 days have passed after the date of notice to the Sponsor of revocation without a reinstatement of its charter) or upon the withdrawal, removal, adjudication or admission of bankruptcy or insolvency of the Sponsor, or an event of withdrawal unless (i) at the time there is at least one remaining Sponsor or (ii) within 90 days of such event of withdrawal Shareholders holding at least a majority of the Shares (not including Shares held by the Sponsor and its affiliates) agree in writing to continue the Trust and to select, effective as of the date of such event, one or more successor Sponsors; the occurrence of any event which would make the existence of the Trust unlawful; in the event of the suspension, revocation or termination of the Sponsor s registration as a CPO, or membership as a CPO with the CFTC or NFA (if, in either case, such registration is required at such time unless at the time there is at least one remaining Sponsor whose registration or membership has not been suspended, revoked or terminated); the Trust becomes insolvent or bankrupt; shareholders holding at least 75% of the then outstanding Shares notify the Sponsor that they elect to dissolve the Trust, written notice of which is sent to the Sponsor not less than 90 days prior to the effective date of dissolution; upon written notice to the Trustee and the Shareholders by the Sponsor, the Sponsor determines that the size of the Trust Estate in relation to the expenses of the Trust make it unreasonable or imprudent to continue the Trust; the Trust is required to be registered as an investment company under the Investment Company Act of 1940; or DTC is unable or unwilling to continue to perform its functions, and a comparable replacement is unavailable. The death, legal disability, bankruptcy, insolvency, dissolution, or withdrawal of any Shareholder (as long as such Shareholder is not the sole Shareholder of the Trust) shall not result in the termination of the Trust, and such Shareholder, his estate, custodian or personal representative shall have no right to withdraw or value such Shareholder s Shares. Each Shareholder (and any assignee thereof) expressly agrees that in the event of his death, he waives on behalf of himself and his estate, and he directs the legal representative of his estate and any person interested therein to waive the furnishing of any inventory, accounting or appraisal of the assets of the Trust and any right to an audit or examination of the books of the Trust, except for such rights as are set forth in Article IX of the Trust Agreement relating to the books of account and reports of the Trust. If the Trust is forced to liquidate, the Trust will be liquidated under the Sponsor s direction. The Sponsor will sell the Fund s bitcoin (at prices as close as practicable to the Bitcoin Price) and Carbon Credit Futures and will distribute to Shareholders any amounts of the cash proceeds in the following order of priority: (a) to the expenses of liquidation and termination and to creditors, including Shareholders who are creditors, to the extent otherwise permitted by law, in satisfaction of liabilities of the Trust other than liabilities for distributions to Shareholders and (b) to the Shareholders pro rata in accordance with the respective percentages of Shares that they hold. It is expected that the Sponsor would be subject to the same regulatory requirements as the Trust, and therefore, the markets available to the Sponsor will be the same markets available to the Trust. Under no circumstances will the Fund distribute bitcoin to Shareholders. AML/KYC The Trust takes measures with the objective of reducing illicit financing risks in connection with the Trust s activities. However, illicit financing risks are present in the digital asset markets, including markets for bitcoin. There can be no assurance that the measures employed by the Trust will prove successful in reducing illicit financing risks, and the Trust is subject to the complex illicit financing risks and vulnerabilities present in the digital asset markets. If such risks eventuate, the Trust, the Sponsor or the Trustee or their affiliates could face civil or criminal liability, fines, penalties, or other punishments, be subject to investigation, have their assets frozen, lose access to banking services or services provided by other service providers, or suffer disruptions to their operations, any of which could negatively affect the Trust s ability to operate or cause losses in value of the Shares. The Trust, the Sponsor and its affiliates have adopted and implemented policies and procedures that are designed to comply with applicable anti-money laundering laws and sanctions laws and regulations, including applicable know your customer ("KYC") laws and regulations. The Sponsor and the Trust will only interact with known third-party service providers with respect to whom the Sponsor or its affiliates have engaged in a due diligence process to ensure a thorough KYC process, such as the Authorized Purchasers, LPs, market makers, FCMs and Bitcoin Custodian. Each Authorized Purchaser, LP, and market maker must undergo onboarding by the Sponsor prior to placing creation or redemption orders with respect to the Fund. As a result, the Sponsor and the Trust have instituted procedures designed to ensure that a situation would not arise where the Trust would engage in transactions with a counterparty whose identity the Sponsor and the Trust did not know. Furthermore, Authorized Purchasers, as broker-dealers, FCMs, and Bitcoin Custodian, as an entity licensed to conduct virtual currency business activity by the New York Department of Financial Services and a limited purpose trust company subject to New York Banking Law, respectively, are "financial institutions" subject to the U.S. Bank Secrecy Act, as amended ("BSA"), and U.S. economic sanctions laws. The Trust will only accept creation and redemption requests from Authorized Purchasers, LPs, and market makers who have represented to the Trust that they have implemented compliance programs that are designed to ensure compliance with applicable sanctions and anti-money laundering laws. The Non-Digital Custodian and Bitcoin Custodian have adopted and implemented anti-money laundering and sanctions compliance programs, which provides additional protections to ensure that the Sponsor and the Trust do not transact with a sanctioned party. Governing Law; Consent to New York Jurisdiction The Trust Agreement and the rights of the Sponsor, Trustee, DTC (as registered owner of the Fund s global certificate for Shares) and Shareholders are governed by the laws of the State of Delaware, except with respect to causes of action for violations of U.S. federal, including the Securities Act and the Exchange Act, or state securities laws. The Trust Agreement and the effect of every provision thereof shall control over any contrary or limiting statutory or common law of the State of Delaware, other than the Delaware Trust Statute. The Trust Agreement does not contain an exclusive forum provision. The Bitcoin Custody Agreement and Authorized Purchaser Agreements are governed by the laws of the state of New York. The governing law for the Non-Digital Custody Agreement is the laws of the State of Minnesota. The Sponsor, the Trustee and DTC and, by accepting Shares, each DTC Participant and each Shareholder, consent to the jurisdiction of the courts of the State of New York and any federal courts located in the borough of Manhattan in New York City. plan of distribution Most investors buy and sell Shares in the secondary market through brokers. Shares trade on the Exchange under the ticker symbol "BTCK". Shares are bought and sold throughout the trading day like other publicly traded securities. When buying or selling Shares through a broker, Shareholders may incur customary brokerage commissions and/or fees. Shareholders are encouraged to review the terms of their brokerage accounts for details regarding applicable charges/fees. The Fund issues shares continuously by offering Baskets consisting of 10,000 Shares to Authorized Purchasers. Authorized Purchasers pay a transaction fee for each order they place to purchase or redeem one or more Baskets. The Sponsor believes that a Basket size of 10,000 Shares will effectively enable Authorized Purchasers to manage inventory of Shares and facilitate an effective arbitrage mechanism for the Fund. However, the Sponsor may adjust the size of the Baskets in order to improve the effectiveness of the activities of Authorized Purchasers in the secondary market for Shares if it deems it necessary or advisable to do so. The Fund does not issue fractions of a Basket. Because new Shares can be created and issued on an ongoing basis, at any point during the life of the Trust, a "distribution," as such term is used in the Securities Act, will be occurring. Authorized Purchasers, other broker-dealers and other persons are cautioned that some of their activities will result in their being deemed participants in a distribution in a manner which would render them statutory underwriters and subject them to the prospectus delivery and liability provisions of the Securities Act. For example, the initial Authorized Purchaser will be a statutory underwriter with respect to the initial purchase of Baskets. Any purchaser who purchases Shares with a view towards distribution of such Shares may be deemed to be a statutory underwriter. In addition, an Authorized Purchaser, other broker-dealer firm or its client will be deemed a statutory underwriter if it purchases a Basket from the Fund, breaks the Basket down into the constituent Shares and sells the Shares to its customers; or if it chooses to couple the creation of a supply of new Shares with an active selling effort involving solicitation of secondary market demand for the Shares. In contrast, Authorized Purchasers may engage in secondary market or other transactions in Shares that would not be deemed "underwriting." For example, an Authorized Purchaser may act in the capacity of a broker or dealer with respect to Shares that were previously distributed by other Authorized Purchasers. A determination of whether a particular market participant is an underwriter must take into account all the facts and circumstances pertaining to the activities of the broker-dealer or its client in the particular case, and the examples mentioned above should not be considered a complete description of all the activities that would lead to designation as an underwriter and subject them to the prospectus-delivery and liability provisions of the Securities Act. The offering of Baskets is being made in compliance with Conduct Rule 2310 of FINRA. Accordingly, Authorized Purchasers will not make any sales to any account over which they have discretionary authority without the prior written approval of a purchaser of Shares. Dealers that are not "underwriters" but are participating in a distribution (as contrasted to ordinary secondary trading transactions), and thus dealing with Shares that are part of an "unsold allotment" within the meaning of Section 4(3)(C) of the Securities Act, would be unable to take advantage of the prospectus delivery exemption provided by Section 4(3) of the Securities Act. An Authorized Purchaser may be indemnified by the Sponsor under certain circumstances, they will not be entitled to receive a discount or commission from the Fund or the Sponsor for their purchases of Baskets. As of the date of this prospectus, the Trust, on behalf of the Fund, has engaged Jane Street Capital, LLC, Citadel Securities LLC and Goldman Sachs & Co. LLC as Authorized Purchasers, and are the Fund s only Authorized Participants. Additional Information Regarding the Shares Book-Entry Form Individual certificates will not be issued for the Shares. Instead, one or more global certificates have been deposited by the Transfer Agent with DTC and registered in the name of Cede & Co., as nominee for DTC. The global certificates will evidence all of the Shares outstanding at any time. Under the Trust Agreement, Shareholders are limited to (1) DTC Participants such as banks, brokers, dealers and trust companies, (2) those who maintain, either directly or indirectly, a custodial relationship with a DTC Participant ("Indirect Participants"), and (3) those banks, brokers, dealers, trust companies and others who hold interests in the Shares through DTC Participants or Indirect Participants. The Shares are transferable only through the book-entry system of DTC. Shareholders who are not DTC Participants may transfer their Shares through DTC by instructing the DTC Participant holding their Shares (or by instructing the Indirect Participant or other entity through which their Shares are held) to transfer the Shares. Transfers will be made in accordance with standard securities industry practice. DTC will act as securities depository for the Shares. DTC is a limited-purpose trust company organized under the laws of the State of New York, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of section 17A of the Exchange Act. DTC was created to hold securities of DTC Participants and to facilitate the clearance and settlement of transactions in such securities among the DTC Participants through electronic book-entry changes. This eliminates the need for physical movement of securities certificates. DTC Participants include securities brokers and dealers, banks, trust companies, clearing corporations, and certain other organizations, some of whom (and/or their representatives) own DTC. Access to the DTC system is also available to others such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a DTC Participant, either directly or indirectly. DTC is expected to agree with and represent to the DTC Participants that it will administer its book-entry system in accordance with its rules and by-laws and the requirements of law. The rights of the Shareholders generally must be exercised by DTC Participants acting on their behalf in accordance with the rules and procedures of DTC. Because the Shares can only be held in book-entry form through DTC and DTC Participants, investors must rely on DTC, DTC Participants and any other financial intermediary through which they hold the Shares to receive the benefits and exercise the rights described in this section. Investors should consult with their broker or financial institution to find out about procedures and requirements for securities held in book-entry form through DTC. Transfer of Shares The Shares are only transferable through the book-entry system of DTC. Shareholders who are not DTC Participants may transfer their Shares through DTC by instructing the DTC Participant holding their Shares (or by instructing the Indirect Participant or other entity through which their Shares are held) to transfer the Shares. Transfers are made in accordance with standard securities industry practice. Transfers of interests in Shares with DTC are made in accordance with the usual rules and operating procedures of DTC and the nature of the transfer. DTC has established procedures to facilitate transfers among the participants and/or account holders of DTC. Because DTC can only act on behalf of DTC Participants, who in turn act on behalf of Indirect Participants, the ability of a person or entity having an interest in a global certificate to pledge such interest to persons or entities that do not participate in DTC, or otherwise take actions in respect of such interest, may be affected by the lack of a certificate or other definitive document representing such interest. Share Splits If the Sponsor believes that the per Share price in the public market for Shares has risen or fallen outside a desirable trading price range, the Sponsor may direct the Transfer Agent to declare a split or reverse split in the number of Shares outstanding and to make a corresponding change in the number of Shares constituting a Basket. CUSTODY OF THE Fund s ASSETS General The Fund s assets will be split among two custodians. The Trust, on behalf of the Fund, intends to appoint Gemini Trust Company, LLC ("Gemini" or the "Bitcoin Custodian") for the Fund s bitcoin holdings. Separately, U.S. Bank, N.A. (the "Non-Digital Custodian" and collectively with the Bitcoin Custodian, the "Custodians") will serve as the Fund s custodian with respect to its cash and cash equivalents investments, as well as any investments in connection with its exposure to Carbon Credit Futures. The Fund may engage third-party custodians or vendors besides the Bitcoin Custodian and the Non-Digital Custodian to provide custody and security services for all or a portion of its bitcoin, cash, and investments in connection with its exposure to Carbon Credit Futures, and the Sponsor will pay the custody fees and any other expenses associated with any such third-party custodian or vendor. The Sponsor is responsible for overseeing the Bitcoin Custodian and Non-Digital Custodian, as well as the Fund s other service providers. Custody of the Fund s Non-Bitcoin Assets U.S. Bank, N.A., holds the Fund s securities, cash and/or cash equivalents pursuant to a custodial agreement in connection with the Fund s Carbon Credit Futures. The Non-Digital Custodian is located at 1555 North Rivercenter Drive, Suite 302, Milwaukee, Wisconsin 53212. U.S. Bank, N.A. is a nationally chartered bank, regulated by the Office of the Comptroller of the Currency, Department of the Treasury, and is subject to regulation by the Board of Governors of the Federal Reserve System. The principal address for Global Fund Services is 615 East Michigan Street, Milwaukee, WI, 53202. The Non-Digital Custodian will also help facilitate the movement of cash (and purchases and sales of assets associated therewith) in connection with creation and redemption of Baskets. For additional information regarding the Non-Digital Custody Agreement, see "The Fund s Service Providers—The Custodians—Non-Digital Custodian" below. Custody of the Fund s Bitcoin The Trust, on behalf of the Fund, intends to appoint Gemini for the custody of the Fund s bitcoin. The Trust, on behalf of the Fund, has entered into a custodial services agreement with Gemini (the "Bitcoin Custody Agreement"), pursuant to which the Bitcoin Custodian will custody all of the Fund s bitcoin. Pursuant to the Bitcoin Custody Agreement, the Bitcoin Custodian establishes accounts that hold the bitcoins deposited with the Bitcoin Custodian on behalf of the Fund. The Bitcoin Custody Agreement is governed by New York law. For additional information regarding the Bitcoin Custody Agreement, see "The Fund s Service Providers—The Custodian—Bitcoin Custodian" below. The Transfer Agent, in coordination with the Bitcoin Custodian and Non-Digital Custodian, will facilitate the settlement of Shares in response to the placement of creation orders and redemption orders from Authorized Purchasers. With respect to the settlement of Shares in response to the placement of creation orders and redemption orders from Authorized Purchasers, to the extent the Fund uses multiple bitcoin custodians, the Sponsor will retain discretion with respect to which of the bitcoin custodians and accompanying assets is selected to facilitate the respective order. The Sponsor may, in its sole discretion, add or terminate other bitcoin custodians. The Sponsor may, in its sole discretion, change the custodian for the Fund s bitcoin holdings, but it will have no obligation to do so or to seek any particular terms for the Fund from other such custodians. To the extent that the Sponsor adds or terminates other bitcoin custodians, or changes the custodian for the Fund bitcoin holdings, notification will be made to Shareholders via a prospectus supplement and/or a current report filed with the SEC. The Fund s Bitcoin Custodian will keep custody of all of the Fund s bitcoin in a custodial account maintained by the Bitcoin Custodian (the "Bitcoin Account") relating to its Bitcoin Account and Clearing Account. Bitcoin private keys are stored in two different forms: "hot wallet" storage, whereby the private keys are stored on secure, internet-connected devices, and "cold" storage, where digital currency private keys are stored completely offline. The Custody Agreement requires the Bitcoin Custodian to hold the Fund s bitcoin in its Bitcoin Account in cold storage, unless required to facilitate withdrawals as a temporary measure. Bitcoin temporarily held in the Clearing Account in connection with creations and redemptions or withdrawals of bitcoin to pay the Management Fee or extraordinary expenses may be held in omnibus hot storage wallets. As a fiduciary under Section 100 of the New York Banking Law, the Bitcoin Custodian is held to specific capital reserve requirements and banking compliance standards. The Bitcoin Custodian is also subject to the laws, regulations and rules of applicable governmental or regulatory authorities, including: money service business regulations under FinCEN; U.S. state money transmission laws; laws, regulations, and rules of relevant tax authorities; applicable regulations and guidance set forth by FinCEN; the Bank Secrecy Act of 1970; the USA PATRIOT Act of 2001; other anti-money laundering regulations as mandated by U.S. federal law and any other rules and regulations regarding anti-money laundering/counter-terrorist financing; issuances from the Office of Foreign Assets Control; the New York Banking Law; regulations promulgated by the New York State Department of Financial Services from time to time; the National Futures Association; the Financial Industry Regulatory Authority; and the Commodity Exchange Act. The Bitcoin Custodian provides custody, clearing/settlement, and other capital markets services specifically designed for digital asset exchange-traded funds and other fund vehicles. The Bitcoin Custodian has been providing services as a limited purpose trust company licensed by the New York State Department of Financial Services (NYSDFS) since 2015. The Bitcoin Custodian is a fiduciary under Section 100 of the New York Banking Law and a qualified custodian for purposes of Rule 206(4)-2(d)(6) under the Advisers Act, and it was the world s first digital asset platform to achieve a SOC 1 Type II and SOC 2 Type II certification for custody. Gemini Custody is also regularly audited and subject to stringent capital reserve requirements. The Bitcoin Custodian has represented to the Sponsor that it also maintains insurance coverage by a reputable insurance company with respect to digital assets custodied with Gemini, in accordance with its internal standards for maintaining such insurance and subject to change at Gemini s discretion. The Fund is not a named insured on such insurance policies and such insurance is not specific to the Fund, but the Bitcoin Custodian has represented to the Sponsor that such insurance covers events that result in a loss of digital assets belonging to customers, including the Fund. The Bitcoin Custodian will use segregated cold storage bitcoin addresses for the Fund s Bitcoin Account, which is separate from the bitcoin addresses that the Bitcoin Custodian uses for its other customers and which are directly verifiable via the bitcoin blockchain. The Bitcoin Custodian will at all times record and identify in its books and records that such bitcoins constitute the property of the Fund. The Bitcoin Custodian will not loan, hypothecate, pledge or otherwise encumber the Fund s bitcoin, as applicable, without the Fund s instruction, nor will the Sponsor or any other entity or service provider. The Fund will not lease or loan bitcoin held in the Fund s account with the Bitcoin Custodian and will not give instructions to that effect. Bitcoin Storage Structure Bitcoin private keys are stored in two different forms: "hot wallet" storage, whereby the private keys are connected to the internet, and "cold" storage, where digital currency private keys are stored completely offline. The Fund s bitcoin will be stored by the Bitcoin Custodian offline in cold storage. When under the purview of the Bitcoin Custodian, bitcoin will only enter "hot" storage in the case of creations and redemptions or withdrawals to pay the Sponsor Fee or extraordinary expenses, meaning that the bitcoin will only be in "hot" storage for a temporary period. The Bitcoin Custodian will store private keys in geographically diverse regions across the continental United States. The Bitcoin Custodian has adopted the following security policies and practices with respect to digital assets held in cold storage: HSMs are used to generate, store and manage cold storage private keys; multi-signature technology is used to provide both security against attacks and tolerance for losing access to a key or facility, eliminating single points of failure; all HSMs are stored offline in air-gapped environments within a diverse network of guarded, monitored and access-controlled facilities that are geographically distributed; multiple levels of physical security and monitoring controls are implemented to safeguard HSMs within storage facilities; and all fund transfers require the coordinated actions of multiple employees. The Bitcoin Custodian has adopted the following security policies and practices with respect to digital assets held in its hot wallet: HSMs are used to store and manage hot wallet private keys; operational redundancy is achieved through geographic disbursement of failover storage facilities and hardware, thus protecting against service disruptions and single points of failure; all hot wallet HSMs are stored within secured facilities that are access-controlled, guarded, and monitored; tiered access-controls are applied to the Bitcoin Custodian s production environment to restrict access to employees based on role, following the principle of least-privilege; administrative access to its production environment requires multi-factor authentication; and it offers additional account level protections such as crypto address whitelisting, which allows customers to restrict withdrawals to addresses only included in the customer s whitelist. The Fund will use a clearing account for the Fund (the "Clearing Account") in connection with clearing and settlement services for bitcoin purchase and sale transactions ("Clearing Services"). While the Bitcoin Custodian maintains records of the Fund s bitcoin balance in its Clearing Account, the actual bitcoin relating to the Fund s Clearing Account is held in omnibus wallets by the Bitcoin Custodian, meaning that bitcoin owned by multiple customers is held in the same wallet and at the same address on the Bitcoin Blockchain. The Fund s Clearing Account balance therefore represents an omnibus claim on the Bitcoin Custodian s bitcoins held in such wallets, and the Fund does not have an identifiable claim to specific bitcoins. The Bitcoin Custodian holds the bitcoin across a combination of omnibus hot wallets and cold wallets. The Sponsor has no control over, and the Bitcoin Custodian does not disclose to the Sponsor, the amount of bitcoin that the Bitcoin Custodian holds in connection with the Fund s Clearing Account in omnibus hot wallets, as compared to omnibus cold wallets. The Bitcoin Custodian could hold substantially all bitcoin connected to the Fund s Clearing Account in omnibus hot wallets. In addition to the Bitcoin Account and the Clearing Account, the Fund will have access to an omnibus custodial account held at depository institutions or money market funds in the Bitcoin Custodian s name for the benefit of its customers at which a cash balance may be maintained ("Fiat Account"). The Bitcoin Custodian s services in respect of the Bitcoin Account (i) allow bitcoin to be deposited from a public blockchain address to the Fund s Bitcoin Account and (ii) allow bitcoin to be withdrawn from the Bitcoin Account to a public blockchain address as instructed by the Fund. The Custody Agreement requires the Bitcoin Custodian to hold the Fund s bitcoin in cold storage, unless required to facilitate withdrawals as a temporary measure. Other than in connection with creations and redemptions and withdrawals of bitcoin to pay the Sponsor Fee and Additional Fund Expenses, where the associated bitcoin may temporarily be held in omnibus hot storage in the Clearing Account, the Bitcoin Custodian will use segregated cold storage bitcoin addresses for the Fund. The addresses on the Bitcoin Blockchain at which the Fund s bitcoin in the Bitcoin Account are held by the Bitcoin Custodian are separate from the bitcoin addresses that the Bitcoin Custodian uses for its other customers and are directly verifiable via the Bitcoin Blockchain. The Bitcoin Custodian will safeguard the private keys to the bitcoin associated with the Fund s Bitcoin Account. The Bitcoin Custodian will at all times record and identify in its books and records that such bitcoins constitute the property of the Fund. The Bitcoin Custodian will not withdraw the Fund s bitcoin from the Fund s Bitcoin Account with the Bitcoin Custodian, or loan, hypothecate, pledge or otherwise encumber the Fund s bitcoin, without the Fund s instruction, nor will the Sponsor or any other entity or service provider. The Fund will not lease or loan bitcoin held in the Fund s Bitcoin Account with the Bitcoin Custodian and will not give instructions to that effect. The Custody Agreement provides that bitcoin is deemed delivered to the address associated with the Fund s Bitcoin Account only after the required number of confirmations of the transaction on the Bitcoin Blockchain, and that Gemini has no obligations for bitcoin that is not delivered in that manner. The Custody Agreement provides that once the Fund submits a request for a withdrawal transaction, the bitcoin subject to the withdrawal request shall be delivered by the Bitcoin Custodian to the designated address on the Bitcoin Blockchain specified in the Fund s withdrawal transaction within one business day of 4:00 p.m. Eastern time of the business day on which the Fund submits the withdrawal request. If a withdrawal request is made by the Fund (i) by 4:00 p.m. Eastern time of the business day on which the Fund submits the withdrawal request, (ii) in connection with a redemption of shares of the Fund by an Authorized Participant, and (iii) the delivery of bitcoin for such withdrawal request is to the account at the Bitcoin Custodian of an Authorized Participant, then the bitcoin subject to such withdrawal request shall be delivered to the destination blockchain address specified therein, by the next business day from the business day when such withdrawal request was submitted. The Custody Agreement provides that withdrawals may be delayed in connection with scheduled maintenance ("Downtime") or the congestion or disruption of a digital asset network, including the Bitcoin Blockchain. In respect of the Fiat Account, the Bitcoin Custodian holds the Fund s cash held in its account at the Bitcoin Custodian in one or more Customer Omnibus Accounts. "Customer Omnibus Account" means, with respect to fiat currency held for customers of the Bitcoin Custodian in fiat accounts (including the Fund s cash balance in its Fiat Account), omnibus bank accounts (each an "Omnibus Account") at depository institutions (each, a "Bank") money market accounts (each, a "Money Market Account") at a Bank or financial institution and/or payment accounts (each, a "Payment Account") at a financial institution. Each Omnibus Account is: (i) in the Bitcoin Custodian s name, and under its control; (ii) separate from the Bitcoin Custodian s business, operating, and reserve bank accounts; (iii) established specifically for the benefit of the Bitcoin Custodian s customers; and (iv) represents a banking relationship, not a custodial relationship, with each Bank. Omnibus Accounts do not create or represent any relationship between the Fund and any of the Bitcoin Custodian s Banks. Each Money Market Account is held at a Bank or financial institution: (i) in the Bitcoin Custodian s name, and under its control; (ii) separate from the Bitcoin Custodian s business, operating, and reserve money market accounts; (iii) established specifically for the benefit of the Bitcoin Custodian s customers; (iv) managed by a registered financial advisor, (v) custodied by a qualified custodian; and (vi) the monies within which are used to purchase money market funds invested in securities issued or guaranteed by the United States or certain U.S. government agencies or instrumentalities. Money Market Accounts do not create or represent any relationship between the Fund and any of the related registered financial advisors and/or qualified custodians. Each Payment Account is held at a financial institution: (i) in the Bitcoin Custodian s name, and under its control; (ii) separate from the Bitcoin Custodian s business, operating, and reserve bank accounts; and (iii) established specifically for processing the fiat funds transfers of the Bitcoin Custodian s customers. Payment Accounts do not create or represent any relationship between the Fund and any of the related financial institutions. The Fund s fiat currency deposits are: (i) held across the Bitcoin Custodian s Customer Omnibus Accounts in the exact proportion that all Bitcoin Custodian customer fiat currency deposits are held across its Customer Omnibus Accounts; (ii) not treated as the Bitcoin Custodian s general assets; (iii) fully owned by the Fund; and (iv) recorded and maintained in good faith on the Bitcoin Custodian s books and records and reflected in a sub-account (i.e., the Fiat Account of the Fund s Gemini Account) so that the Fund s interests in the Bitcoin Custodian s Customer Omnibus Accounts are readily ascertainable. The Bitcoin Custodian s records permit the determination of the balance of U.S. dollars for a particular customer as a percentage of total commingled U.S. dollars held for the benefit of all of the Bitcoin Custodian s customers in all Customer Omnibus Accounts in a manner consistent with 12 C.F.R. 330.5(a)(2). The Fund is not entitled to receive any interest that may be generated with respect to the cash held in its Fiat Account. U.S. dollar deposits in the Fund s Fiat Account held in one or more Omnibus Accounts at one or more Banks located in the United States are held with the intention that they be eligible for Federal Deposit Insurance Corporation ("FDIC") "pass-through" deposit insurance, subject to the Standard Maximum Deposit Insurance Amount per FDIC regulations (currently $250,000 per eligible customer of the Bitcoin Custodian) and other applicable limitations. U.S dollar deposits held at banks or financial institutions located outside of the United States, may not be subject to or eligible for FDIC deposit insurance. The portion of the Fund s cash holdings attributable to the Fund s Fiat Account which is held at a Money Market Fund is not eligible for deposit insurance whether on a pass-through or any other basis. The Custody Agreement provides that wire deposit and withdrawal transfer times in respect of the Fiat Account are subject to bank holidays, the internal processes and jurisdiction of the Fund s bank, and the internal processes of the Bitcoin Custodian s banks and financial institutions. In certain situations, wire deposit or withdrawal transfer times may be delayed in connection with Downtime or disruptions to the Bitcoin Custodian s banks and/or affiliates or service providers. ACH deposit and withdrawal transfer times are subject to bank holidays, the internal processes and jurisdiction of the Fund s bank, and the internal processes of the Fund s banks. The Custody Agreement provides that in certain situations, ACH withdrawal transfer times may be delayed in connection with Downtime or disruptions to the Bitcoin Custodian s banks and/or affiliates or service providers. Gemini BSA/AML Program The Bitcoin Custodian has adopted the Gemini BSA/AML Program for its digital asset trading platform and custody service in an effort to maintain the highest possible compliance with applicable laws and regulations relating to anti-money laundering in the U.S. and other countries where it conducts business. This program includes robust internal policies, procedures and controls that combat any attempted use of Gemini for illegal or illicit purposes, including a customer identification program, annual training of all employees and officers in anti-money laundering regulation, filing of Suspicious Activity Reports and Currency Transaction Reports with the U.S. Financial Crimes Enforcement Network and annual internal and independent audits of the Gemini BSA/AML Program. Website Security The Bitcoin Custodian has implemented certain security policies and practices to enhance security on its website, including through the use of two-factor authentication for certain user actions, such as withdrawals; a requirement for strong passwords from its users, which are cryptographically hashed using modern standards; encryption of sensitive user information, both in transit and at rest; the application of rate-limiting procedures to certain account operations such as login attempts to thwart brute force attacks; the transmission of website data over encrypted transport layer security connections; the leveraging of content-security policy and HTTP strict transport security features in modern browsers; partnerships with enterprise vendors to mitigate-potential distributed denial-of-service attacks; and the use of separate access controls on internal-only sections of the Bitcoin Custodian s website. Internal Control In addition to the security policies and procedures discussed above, the Bitcoin Custodian has also instituted the following internal controls: multiple signatories are required to transfer funds out of cold storage; the Bitcoin Custodian s Chief Executive Officer and President are unable to individually or jointly transfer funds out of cold storage; all private keys are stored offsite in secure facilities; all employees undergo criminal and credit background checks, and are subject to ongoing background checks throughout their employment; and all remote-access by employees uses public-key authentication (e.g. no passwords, one-time passwords or other phishable credentials are used). Insurance The Bitcoin Custodian, as custodian of the Fund s bitcoin, is responsible for securing the Fund s bitcoin. As of March 1, 2024, Gemini maintains $125 million in digital asset insurance for certain types of losses, in addition to the capital reserves required of Gemini as a New York limited purpose trust company and fiduciary under New York Banking Law. This consists of $25 million of commercial crime insurance for digital assets held in its hot storage system, and $100 million of offline (cold storage system) insurance coverage for assets held. The Bitcoin Custodian has represented to the Fund applies to all customer assets held at the Bitcoin Custodian, including the Fund s assets. Such insurance is shared with other customers and is not specific to the Fund. The Fund is not a named beneficiary under the Bitcoin Custodian s insurance policies, though the Bitcoin Custodian has represented to the Sponsor that the insurance covers customer losses, including losses suffered by the Fund, arising from specified events, including fraud, theft, and cyber-security breaches. The amounts and continuing availability of this coverage are subject to change at the Bitcoin Custodian s sole discretion. The Bitcoin Custodian also maintains separate commercial crime insurance coverage for digital assets custodied in its "hot wallet". To date, the Bitcoin Custodian has never experienced a loss due to unauthorized access from its hot wallet or the cold storage vaults. Each Bitcoin Trading Counterparty is required to maintain a Bitcoin Trading Counterparty bitcoin account at the Fund s Bitcoin Custodian. The Fund s Transfer Agent will facilitate the settlement of Shares in response to the placement of creation orders and redemption orders from Authorized Participants. The Fund generally does not intend to hold cash or cash equivalents except in connection with cash creation and redemption orders. However, there may be situations where the Fund will unexpectedly hold cash on a temporary basis. THE Fund s Service providers The Sponsor The Sponsor is Tidal Investments LLC (f/k/a Toroso Investments LLC), a Delaware limited liability company. The Sponsor s principal place of business is 234 West Florida Street, Suite 203, Milwaukee, Wisconsin 53204. The Sponsor arranged for the creation of the Trust and the Fund and is responsible for the ongoing registration of the Shares for their public offering in the U.S. and the listing of Shares on the Exchange. The Sponsor serves as the Fund s CPO and is registered as a CPO and a CTA with the CFTC. Tidal services over 175 ETFs with over $26 billion in assets across a diverse range of investment strategies. Our leadership team brings a wealth of expertise, with over 300 years of combined ETF industry experience. We have more than 75 specialized professionals dedicated to helping our clients successfully launch, manage, and grow ETFs. Our services include trust management, trading, capital markets, product development, fund administration, accounting, legal, compliance, and marketing. Tidal has been a leader in the Digital Assets space since 2015, beginning as early investors in GBTC, one of the first products to provide Bitcoin exposure. In 2018, Tidal became the sub-advisor for BLOK, an innovative, actively managed ETF focused on blockchain technology, which broke new ground by being the first ETF to allocate to spot Bitcoin ETFs. This commitment to innovation continued in 2024, when Tidal partnered with Hashdex to successfully convert their Bitcoin futures ETF into a spot Bitcoin ETF, further advancing accessibility to digital asset investments. As consideration for its receipt of the Management Fee from the Fund, the Sponsor is obligated to pay the Sponsor-paid Expenses. The Sponsor also paid the costs of the Fund s organization and will pay for the costs of the initial sale of the Shares. The Sponsor has agreed to pay certain operating expenses out of the Sponsor s unified management fee. The Fund is responsible for the payment of any litigation expenses, other extraordinary expenses, and any transaction-based costs or expenses (e.g., brokerage commissions or mark-ups). For the Sponsor s services, the Fund is contractually obligated to pay a monthly management fee to the Sponsor, based on average daily net assets, at a rate equal to 0.68% per annum. The Fund is newly organized and as of the date of this prospectus has not paid any management fees to the Sponsor. The Sponsor is generally responsible for the administration of the Fund pursuant to the authorities granted to it under the Trust Agreement. This includes (i) selecting and monitoring the Fund s Service Providers and from time to time engaging additional, successor or replacement Service Providers and (ii) upon dissolution of the Fund, distributing the Fund s assets (or the value of such assets, when liquidated) on a pro rata basis to the Shareholders in accordance with their Shares. In addition to the foregoing, the Sponsor is responsible for management and conducts or directs the conduct of the business of the Trust, the Fund, and any series the Trust that may from time to time be established and designated by the Sponsor. The Sponsor has the authority to oversee the purchase and sale of Shares by Authorized Purchasers and to manage the Fund s investments, including to evaluate the credit risk of FCMs and to review daily positions and margin/collateral requirements. The Sponsor has the power to enter into agreements as may be necessary or appropriate for the offer and sale of the Fund s Shares and the conduct of the Trust s activities. The following is a biographical summary of the business experience of each of the Executive Officers the Sponsor, all of whom are members of the Sponsor: Mr. Guillermo Trias, born in 1976, has served as the Co-Founder and CEO of Tidal Investments LLC since November 1, 2015. In his role, he oversees the overall strategic direction, management, and operational aspects of the firm s ETF investment platforms. Mr. Trias was approved as a Principal of the Sponsor by the NFA on February 7, 2022. He holds a Business Administration degree from CUNEF and an MBA from the Kellogg School of Management at Northwestern University. Mr. Michael Venuto, born in 1977, has been the Chief Investment Officer at Tidal Investments LLC since March 12, 2012. His responsibilities at Tidal include the strategic planning and execution of ETF-based investment strategies, focusing on innovation and market responsiveness. Mr. Venuto was approved as a Principal of the Sponsor by the NFA on February 25, 2022. Mr. Dan Carlson, born in 1955, has been the CFO at Tidal Investments LLC since March 12, 2012, and served as CCO from March 12, 2012 to March 31, 2023. His responsibilities involve managing the company s financial operations and overseeing financial planning. He holds a BS degree in Accounting from the University of Illinois, Champaign-Urbana. Mr. Carlson was approved as a Principal of the Sponsor by the NFA on February 7, 2022. Mr. Eric Falkeis, born in 1973, has been the Chief Growth Officer at Tidal Investments LLC since November 1, 2018, and co-founded Tidal ETF Services. His role at Tidal involves leading business development and growth strategy initiatives. Mr. Falkeis is a CPA and holds a BS degree in Accounting from Marquette University. As of the date of this prospectus, his application to be listed as a Principal of the Sponsor is currently pending with the NFA. Mr. Gavin Filmore, born in 1984, joined Tidal Investments LLC as the Head of Product Development in August 2021 and was promoted to COO in July 2022. Before joining Tidal, he worked at Barclays Investment Bank, a leading global investment bank offering services in investment management, wealth management, and corporate banking, from August 2017 to September 2021. His focus at Barclays was on Exchange Traded Products. Mr. Filmore holds a BS in Finance from Northeastern University. He was approved as a Principal of Tidal Investments LLC and registered as an Associated Person of the Sponsor by the NFA on March 8, 2022. Mr. William Woolverton, born in 1951, has been the Chief Compliance Officer of Tidal Investments LLC, Tidal ETF Trust, and Tidal Trust II since November 10, 2022. Prior to joining Tidal, he was a Senior Principal Consultant at ACA Group, a firm specializing in governance, risk, and compliance services for financial institutions, from March 2020 to October 2022. Before ACA Group, Mr. Woolverton served as Managing Director - US at Waystone, a company offering comprehensive fund governance, risk, compliance, and administration services to the asset management industry, from April 2016 to December 2019. Mr. Woolverton received his M.A. from King s College, Cambridge University, and a law degree from Columbia University School of Law. He was approved as a Principal of the Sponsor by the NFA on April 5, 2023. The following are individual Principals, as that term is defined in CFTC Rule 3.1, of Tidal Investments LLC: Messrs. Michael Venuto, Guillermo Trias and Daniel Carlson. Their status as principals is primarily due to their ownership interests in the Sponsor. Mr. Trias, in particular, holds his interest through GT Capital Advisors LLC, a company he owns and manages, which has over 10% ownership stake in the Sponsor, thereby establishing GT Capital Advisors LLC as a principal of the sponsor under CFTC regulations. Additionally, FTV Toroso Inc. is identified as a principal of Sponsor under CFTC Rules due to its ownership interest exceeding 10% in the Sponsor. Mr. Falkeis qualifies as a principal under CFTC Rule 3.1 due to his role as Chief Operating Officer. On March 11, 2024, Mr. Eric Falkeis submitted an application to be listed as a Principal of the Sponsor. As of the date of this prospectus, Mr. Falkeis application is pending with the NFA. The Trustee Wilmington Trust, National Association, a national banking association, serves as Delaware trustee of the Trust under the Trust Agreement. The Trustee has its principal office at 1100 North Market Street, Wilmington, Delaware 19890-0001. The Trustee is unaffiliated with the Sponsor. A copy of the Trust Agreement is available for inspection at the Trustee s principal office identified above. The Trustee s Role The Trustee will accept service of legal process on the Trust in the State of Delaware and will make certain filings under the DSTA. The Trustee does not owe any other duties to the Trust, the Sponsor or the Shareholders. Under the Trust Agreement, the Trustee has delegated to the Sponsor the exclusive management and control of all aspects of the business of the Trust and the Fund. The Trustee has no duty or liability to supervise or monitor the performance of the Sponsor, nor does the Trustee have any liability for the acts or omissions of the Sponsor. The Trustee has not signed the registration statement of which this prospectus is a part and is not subject to issuer liability under the federal securities laws for the information contained in this prospectus and under federal securities laws with respect to the issuance and sale of the Shares. Under such laws, neither the Trustee, either in its capacity as Trustee or in its individual capacity, nor any director, officer or controlling person of the Trustee is, or has any liability as, the issuer or a director, officer or controlling person of the issuer of the Shares. Because the Trustee has no authority over the Trust s operations, the Trustee itself is not registered in any capacity with the CFTC. The Trust Agreement provides that the Trustee is entitled to reasonable compensation for its services from the Sponsor or an affiliate of the Sponsor (including the Trust), and is indemnified by the Sponsor against any expenses it incurs relating to or arising out of the formation, operation or termination of the Trust, or any action or inaction of the Trustee under the Trust Agreement, except to the extent that such expenses result from the fraud, or the gross negligence or willful misconduct of the Trustee. The Sponsor has the discretion to replace the Trustee. The Trustee is permitted to resign upon at least sixty (60) days notice to the Sponsor. If no successor trustee has been appointed by the Sponsor within such sixty-day period, the Trustee may, at the expense of the Trust, petition a court to appoint a successor. The Trustee s fees and expenses under the Trust Agreement will be paid by the Sponsor. The Administrator The Administrator of the Fund is Tidal ETF Services pursuant to the Fund Administration Servicing Agreement. The Administrator has its principal office at 234 West Florida Street, Suite 203, Milwaukee, Wisconsin 53204. The Administrator is a wholly-owned subsidiary of the Sponsor. In turn, the Administrator has engaged U.S. Bancorp Fund Services, LLC, doing business as U.S. Bank Global Fund Services ("Global Fund Services") to act as sub-administrator. The Administrator is a wholly-owned subsidiary of Sponsor. The Administrator also assists the Fund and the Sponsor with certain functions and duties relating to marketing, which include the following: marketing and sales strategy, and marketing related services. Fund Administration Servicing Agreement. Under the Fund Administration Servicing Agreement, the Administrator assists with overall operation of the funds, acts as a liaison among service providers, assists with regulatory compliance, and preparation of certain regulatory and financial reports. Under the Fund Administration Servicing Agreement, the Trust shall indemnify and hold harmless the Administrator from and against any and all claims, demands, losses, expenses, and liabilities of any and every nature (including reasonable attorneys fees) the Administrator may sustain or incur or that may be asserted against Administrator by any person arising out of any action taken or omitted to be taken by it in performing the services hereunder (i) in accordance with the foregoing standards, or (ii) in reliance upon any written or oral instruction provided to Administrator by any duly authorized officer of the Trust or the Sponsor, except for any and all claims, demands, losses, expenses, and liabilities arising out of or relating to Administrator s refusal or failure to comply with the terms of this Fund Administration Servicing Agreement or from its bad faith, negligence or willful misconduct in the performance of its duties under this Fund Administration Servicing Agreement. The Fund Administration Servicing Agreement will continue in effect for a period of three years and may be terminated by any party upon giving 90 days prior written notice to the other parties or such shorter period as is mutually agreed upon by the parties. The governing law for the agreement is the State of Wisconsin. The Transfer Agent, Sub-Administrator and Fund Accountant U.S. Bank Global Fund Services ("Global Fund Services"), an entity affiliated with U.S. Bank, N.A., is the registrar and transfer agent for the Fund s Shares. In addition, Global Fund Services also serves as sub-administrator for the Fund, performing certain sub-administrative, and accounting services, and support in preparing certain SEC and CFTC reports on behalf of the Fund. The principal address for Global Fund Services is 615 East Michigan Street, Milwaukee, WI, 53202. The Transfer Agent holds the Shares in book-entry form. The Administrator directs the Transfer Agent to credit or debit the number of Creation Baskets or Redemption Baskets to the applicable Authorized Purchaser. The Transfer Agent will issue or cancel each Authorized Purchaser s Creation Basket or Redemption Basket, as applicable. The Transfer Agent will also assist with the preparation of Shareholders account and tax statements. The Transfer Agent Fee is a Sponsor-paid Expense to be assumed and paid by the Sponsor. Sub-Administration Agreement. The Fund Sub-Administrator is U.S. Bancorp Fund Services, LLC, doing business as U.S. Bank Global Fund Services (Global Fund Services). In the Fund Administration Servicing Agreement with the Trust and the Sponsor, Global Fund Services has been appointed to provide a range of administrative services to the Trust. These services encompass general fund management, financial reporting, tax reporting, and optional additional tax services, as detailed in the Agreement. The agreement specifies an initial term of three years, with automatic renewal for successive one-year periods unless a party provides 90 days prior written notice indicating non-renewal. Termination can occur under several conditions, including material breach, compliance with applicable laws, or operational changes that affect Global Fund Services or the Trust. Additionally, the Agreement may be amended only through a written agreement executed by both parties. The agreement limits the Global Fund Services liability to direct damages arising from Global Fund Services refusal or failure to comply with the terms of the agreement or from its bad faith, negligence or willful misconduct in the performance of its duties under the agreement. The Trust is required to indemnify Global Fund Services against losses or liabilities incurred in performing its duties, except in cases of failure to meet the standard of care or due to the Fund Administrator s own misconduct. Conversely, Global Fund Services is obligated to indemnify the Trust against any liabilities arising from Global Fund Services refusal or failure to comply with the terms of the Agreement or from its bad faith, negligence or willful misconduct in the performance of its duties under this Agreement. The agreement is governed by the laws of the State of Wisconsin. Both parties agree to maintain confidentiality regarding proprietary information, with allowances for disclosure as required by law or upon mutual agreement. Transfer Agent Servicing Agreement. The Transfer Agent Servicing Agreement is between Global Fund Services, a registered transfer agent under the Exchange Act, the Trust and the Sponsor. Under this agreement Global Fund Services is appointed as the transfer agent for the Trust, providing services related to the creation and redemption of shares, dividend disbursing, and maintaining shareholder records. Global Fund Services is responsible for facilitating purchases and redemptions of Creation Units, handling transactions with Authorized Participants, managing dividend payments for the Trust s shares. Global Fund Services also records issuance of shares and maintains a record of outstanding shares for each fund in the Trust. Global Fund Services is obligated to exercise reasonable care. Its liability is limited to direct damages arising from Global Fund Services refusal or failure to comply with the terms of the agreement or from its bad faith, negligence or willful misconduct in the performance of its duties under this agreement. The Trust is obligated to indemnify Global Fund Services against claims not arising from the agent s non-compliance or misconduct. Global Fund Services is required to implement its designed to promote the detection and reporting of potential money laundering activity and identity theft by monitoring certain aspects of shareholder activity as well as written procedures for verifying a customer s identity. The Transfer Agent Agreement has an initial three-year term, automatically renewing for one-year periods unless terminated by a party upon 90 days written notice. Early termination requires the Trust to pay remaining fees and costs related to the transition to a new service provider. This agreement includes clauses on confidentiality, proprietary information, and record-keeping responsibilities, ensuring both parties maintain confidentiality of sensitive information and is governed by the laws of the State of Wisconsin. Fund Accounting Agreement. The Fund Accounting Servicing Agreement is between Global Fund Services, the Trust, and the Sponsor. Under this Agreement, Global Fund Services is appointed as the fund accountant for the Trust, responsible for various accounting services such as portfolio accounting, expense accrual and payment, trust valuation and financial reporting, tax accounting, and compliance control services. The Agreement is set for an initial term of three years, with automatic renewal for successive one-year terms unless terminated earlier. Termination can occur under specific conditions, including material breach or changes in laws affecting the Agreement. The Trust and Sponsor can also terminate the agreement upon 90 days notice, and Global Fund Services may do the same under certain circumstances, such as the existence of certain legal compliance issues or reputational harm. Global Fund Services is obligated to exercise reasonable care in its duties. Global Fund Services liability under the agreement limited to losses arising from Global Fund Services refusal or failure to comply with the terms of the agreement or from its bad faith, negligence or willful misconduct in the performance of its duties under this agreement. The Trust is obligated to indemnify Global Fund Services against losses not arising from such failures or misconduct. Conversely, Global Fund Services is obligated to indemnify the Trust for losses resulting from its non-compliance or misconduct. The agreement includes clauses on confidentiality, proprietary information, and record-keeping responsibilities, ensuring both parties maintain confidentiality of sensitive information. The agreement has an initial three-year term, automatically renewing for one-year periods unless terminated by a party upon 90 days written notice and is governed by the laws of the State of Wisconsin. The Custodians The Fund s assets will be split among two custodians. The Trust, on behalf of the Fund, intends to appoint Gemini Trust Company, LLC for the Fund s bitcoin holdings. Separately, U.S. Bank, N.A., will serve as the Fund s custodian with respect to its cash and cash equivalents investments, as well as any investments in connection with its exposure to Carbon Credit Futures. Bitcoin Custodian Gemini Trust Company, LLC serves as the Fund s Bitcoin Custodian, pursuant to its custodial agreement, to hold a portion of the Fund s bitcoin in accordance with the procedures outlined above in the section "Custody of the Fund s Assets". Gemini Trust Company, LLC has its principal offices at 315 Park Ave South, Floor 16, New York, NY 10010. Gemini s a fiduciary under 100 of the New York Banking Law. The Bitcoin Custodian is authorized to serve as the Fund s custodian under the Trust Agreement and pursuant to the terms and provisions of the Custody Agreement. In designating a custodian as a bitcoin custodian for the Fund, the Sponsor considers whether the custodian provides protection against theft and loss and ensures that the transactions and trades are secure. The Sponsor may consider whether a custodian: 1. Provides custody accounts whose holders are the legal beneficiaries of the assets held in the account. In case of bankruptcy or insolvency of a Bitcoin Custodian, creditors or the estate should have no rights to the clients assets. 2. Offers segregated accounts and stores the Fund s bitcoin in separated individual accounts and not in omnibus accounts. That means that The Fund s bitcoin shall be held in segregated wallets and therefore are not commingled with the Bitcoin Custodian s or other customer assets. 3. Generates account-segregated private keys for digital assets using high entropy random number generation methods and employing advanced security practices. 4. Utilizes technology for storing private keys in offline digital vaults and applies secure processes, such as private key segmentation, multi-signature authorization, and geographic distribution of stored assets, to limit access to private keys. The Bitcoin Custodian should use security technology for storing private keys aiming to avoid theft or misappropriation of assets due to online attacks, collusion of agents managing the storage services, or any other threat. 5. Has a comprehensive risk management policy and formalized framework of managing operational and custody risks, including a disaster recovery program that ensures continuity of operations in the event of a system failure. The Bitcoin Custodian shall have a business continuity plan to help ensure continued access to the Fund s assets. 6. Has an insurance policy that covers, at least partially, risks such as the loss of client assets held in cold storage, including from employee collusion or fraud, physical loss including theft, damage of key material, security breach or hack, and fraudulent transfer. 7. Complies with higher standards of government oversight, external audits, and security, and as such, Bitcoin Custodian is able to offer better legal guarantees that safekeep asset ownership. The Bitcoin Custodian may be licensed or registered as a custodian by a reputable and independent governing body (e.g., the New York State Department of Financial Services, or other state, national or international regulators), as can be ascertained by certain public data sources. 8. Provides third-party audit reports at least annually on operational and security processes. This audit may be completed by having a Systems and Organizational Control certification ("SOC") issued. Auditors provide reasonable assurance that the Bitcoin Custodian operational processes and private key management controls are in accordance with the expected standards. A custodian may lose its eligibility as a Bitcoin Custodian if it fails to comply with the above requirements, but the Sponsor has no obligation whatsoever to change the Bitcoin Custodian for the Fund s bitcoin holdings. The Bitcoin Custodian may also employ advanced blockchain monitoring tools and services to ensure the security and compliance of incoming transactions, including: 1. Transaction Validation: When a transaction is initiated, these monitoring tools immediately validate it against predefined criteria, including sender addresses, transaction amounts, and transaction details, to ensure they comply with the custodian s policies and regulatory requirements. 2. Real-time Alerts: These monitoring tools offer real-time alerting capabilities, using advanced algorithms to identify suspicious or potentially fraudulent transactions. They detect patterns that may indicate money laundering, fraud, or other illicit activities. 3. AML/KYC Compliance: To comply with Anti-Money Laundering (AML) and Know Your Customer (KYC) regulations, custodians integrate these solutions to verify sender and receiver identities, ensuring transactions are conducted by legitimate parties and meeting regulatory requirements. The Sponsor has evaluated the Bitcoin Custodian s policies, procedures, and controls for safekeeping, exclusively possessing, and controlling the Fund s bitcoin holdings and believes these are designed consistent with accepted industry practices to protect against theft, loss, and unauthorized and accidental use of the private keys. Notwithstanding the Sponsor s evaluation, the Sponsor does not control Bitcoin Custodian s operations or implementation of such policies, procedures and controls and there can be no assurance that they will actually work as designed or prove to be successful in safeguarding the Fund s assets against all possible sources of theft, loss or damage. Bitcoin Custody Agreement. The Trust, on behalf of the Fund, has entered into a custodial services agreement with the Bitcoin Custodian. The Bitcoin Custodian agrees to take reasonable care and use commercially reasonable efforts in executing its responsibilities to the Trust pursuant to the Bitcoin Custody Agreement, which includes exercising the degree of care, diligence and skill that a prudent and competent professional provider of services similar to the services contemplated by the Bitcoin Custody Agreement would exercise in the circumstances, or such higher care where required by law or the Bitcoin Custody Agreement (collectively, the "Standard of Care"). The Bitcoin Custodian cannot be held responsible for any failure or delay to act by the Bitcoin Custodian, its affiliates or service providers, or its banks that is within the time limits permitted by the Bitcoin Custody Agreement, or that is caused by the Fund s negligence or is required to comply with applicable laws and regulations. The Bitcoin Custodian cannot be held responsible for any Downtime or System Failure (defined below), which prevents the Bitcoin Custodian from fulfilling its obligations under the Bitcoin Custody Agreement, provided that Bitcoin Custodian took reasonable care and used commercially reasonable efforts to prevent or limit such System Failures or Downtime and otherwise complied with this Agreement. The Bitcoin Custody Agreement provides that a "System Failure" shall mean a failure of any computer hardware, software, computer systems, or telecommunications lines or devices used by Bitcoin Custodian, or interruption, loss, or malfunction of utility, data center, Internet or network provider services used by Bitcoin Custodian; provided, however, that a cybersecurity attack, data breach, hack, or other intrusion, or unauthorized disclosure by a third party, Bitcoin Custodian, a Bitcoin Custodian affiliate or service provider, or an agent or subcontractor of Bitcoin Custodian, shall not be deemed a System Failure, to the extent such events or any losses arising therefrom are due to Bitcoin Custodian s failure to comply with its obligations under the Bitcoin Custody Agreement. The Bitcoin Custodian cannot be held responsible for any circumstances beyond the Bitcoin Custodian s reasonable control, provided Bitcoin Custodian acted in accordance with the Standard of Care. Notwithstanding any other provision in the Bitcoin Custody Agreement, for the Fund s bitcoin held in the Bitcoin Account, the Bitcoin Custodian represents, warrants, and covenants that it will maintain the private key or keys in a form accessible to the Bitcoin Custodian and will take reasonable care and use commercially reasonable efforts to (i) protect and keep the private key or keys secure and (ii) not disclose them or allow access to them by any other person. The Bitcoin Custodian shall take reasonable care and use commercially reasonable efforts to ensure that the Trust shall be able to access the Bitcoin Account via the Bitcoin Custodian s online interface 97% of the time excluding Downtime and System Failures. The Bitcoin Custodian shall not, without the prior written consent of the Trust, deposit or hold the Fund s bitcoin with any third-party depositary, custodian, clearance system, wallet, or sub-custodian. Subject to the foregoing, the Bitcoin Custodian is permitted to perform its obligations under the Bitcoin Custody Agreement using subcontractors or agents, provided that, in relation to each such subcontractor or agent used by the Bitcoin Custodian, the Bitcoin Custodian shall: (i) comply with the Standard of Care in the selection, appointment and use of each such subcontractor or agent; (ii) monitor such subcontractor s or agent s performance; and (iii) remain solely liable to Trust for the performance of the Bitcoin Custodian s obligations under the Bitcoin Custody Agreement, notwithstanding any use of subcontractors or agents. The Bitcoin Custody Agreement provides that no more than once per calendar year, the Trust shall be entitled to request that the Bitcoin Custodian produce its Services Organization Controls 2 Type I report (a "SOC 2-I Report") and a new Services Organization Controls 2 Type II report (a "SOC 2-II Report" and, together with a SOC 2-I Report, "SOC Reports"), or certify that there have been no material changes which would impact the previous SOC Reports provided to the Trust, and promptly deliver to the Trust a copy of each SOC Report within 45 days of the Trust s request. No more than once per calendar year, the Trust shall be entitled to request that the Bitcoin Custodian produce a copy of the Bitcoin Custodian s audited annual financial statements for each financial year ending on or after December 31, 2021, and the Bitcoin Custodian shall promptly deliver such financial statements to the Trust. Subject to the "Force Majeure" provision (defined below) and as limited by the limitations of liability in the Bitcoin Custody Agreement, the Bitcoin Custodian shall be liable to the Trust for the Loss (defined below) of any of the Fund s bitcoin or fiat currency to the extent that such Loss was caused by the negligence, fraud, willful or reckless misconduct of the Bitcoin Custodian or breach by the Bitcoin Custodian of its Standard of Care. The Bitcoin Custody Agreement provides that "Loss" means if, at any time the Fund s bitcoin Account or Fiat Account, as applicable, does not hold the bitcoin or fiat currency that had been (1) received by Bitcoin Custodian in connection with the Fund s bitcoin Account or Fiat Account pursuant to the Bitcoin Custody Agreement, or (2) duly sent to the Bitcoin Custodian by the Trust or Authorized Participants in connection with the Fund s bitcoin Account pursuant to the Bitcoin Custody Agreement but not received because of a failure caused by the Bitcoin Custodian. The Bitcoin Custody Agreement provides that "Loss" shall include situations where the Bitcoin Custodian fails to execute a valid withdrawal request, bitcoin are withdrawn from the Fund s bitcoin Account other than pursuant to a withdrawal request, or the Trust is not able to timely withdraw bitcoin from the Bitcoin Account pursuant to a withdrawal request, in each case due to a failure caused by the Bitcoin Custodian; provided, however, that the Bitcoin Custodian s failure to permit timely withdrawals because it has determined that it cannot do so due to the requirements of applicable laws and regulations or because of the operation of its fraud detection controls shall not be considered a Loss, provided the Bitcoin Custodian is acting reasonably and in good faith. The Bitcoin Custody Agreement provides that should a Loss of the Fund s bitcoin or fiat currency due to the negligence, fraud, willful or reckless misconduct of the Bitcoin Custodian or a breach by the Bitcoin Custodian of its Standard of Care occur, the Bitcoin Custodian will, as soon as practicable, return to the Trust a quantity of the same digital asset that is equal to the quantity of digital assets involved in the Loss, or return to the Trust a quantity of the same fiat currency that is equal to the quantity of fiat currency involved in the Loss (if the Loss involved the Fiat Account). The Bitcoin Custody Agreement provides that (i) the Bitcoin Custodian does not own or control the underlying software protocols of networks which govern the operation of digital assets (including the Bitcoin Blockchain), (ii) the Bitcoin Custodian makes no guarantees regarding their security, functionality, or availability, and (iii) in no event shall the Bitcoin Custodian be liable for or in connection with any acts, decisions, or omissions made by developers or promoters of digital assets, including bitcoin. The Bitcoin Custody Agreement s "Force Majeure" provision provides that in no event shall the Bitcoin Custodian be liable for any delays, failure in performance or interruption of service which result directly or indirectly from any cause or condition, whether or not foreseeable, beyond the Bitcoin Custodian s reasonable control, including, but not limited to, any act of God, nuclear or natural disaster, epidemic, action or inaction of civil or military authorities, act of war, terrorism, sabotage, civil disturbance, strike or other labor dispute, accident, or state of emergency; provided, however, that for the avoidance of doubt, the Bitcoin Custody Agreement s Force Majeure provision shall not apply in respect of System Failures or Downtime, which are subject to other respective provisions of the Bitcoin Custody Agreement. The occurrence of an event described in the Force Majeure provision shall not affect the validity and enforceability of any remaining provisions of the Bitcoin Custody Agreement. Under the Bitcoin Custody Agreement, each of the Bitcoin Custodian and the Trust has agreed to indemnify and hold harmless the other party from any third-party claim or third-party demand (including reasonable attorneys fees and expenses) (collectively, "Damages") arising out of or related to the Bitcoin Custodian s or the Trust s, as the case may be, non-performance of its obligations under or material breach of the Bitcoin Custody Agreement and inaccuracy in any of the Bitcoin Custodian s or the Trust s, as the case may be, representations or warranties in the Bitcoin Custody Agreement. In addition, the Bitcoin Custodian agrees to indemnify the Trust in the event of Damages relating to the holding of the Fund s bitcoin and fiat currency by the Bitcoin Custodian as contemplated by the Bitcoin Custody Agreement, including any loss or damage caused by any act or omission of any employee of the Bitcoin Custodian or any agent, representative or independent contractor engaged by the Bitcoin Custodian, whether or not such act or omission occurred within the scope of his employment or engagement. The Bitcoin Custody Agreement provides that "Damages" shall not include any losses, claims, damages, liabilities or expenses arising from any fluctuation in market price, forks, governance changes, airdrops or other events which impact all holders of a digital asset such as bitcoin globally as a class. The Bitcoin Custody Agreement provides the Bitcoin Custodian, its affiliates, service providers, or any of their respective officers, directors, agents, joint venturers, employees or representatives, shall not be liable for (i) any losses or claims arising out of actions that are in the Trust s control and related to its use of the Bitcoin Custodian s online platform, including but not limited to, the Trust s failure to follow security protocols, the Bitcoin Custodian s controls, improper instructions, failure to secure the Trust s credentials from third parties, or anything else in the Trust s control and (ii) any amount greater than the value of the bitcoin on deposit in the Fund s bitcoin Account at the time of, and directly relating to, the events giving rise to the liability occurred, the value of which shall be determined in accordance with the Chicago Mercantile Exchange Bitcoin Reference Rate or any successor thereto. No party shall be liable to the other parties (whether under contract, tort (including negligence) or otherwise) for any indirect, incidental, special, punitive or consequential losses suffered or incurred by the other parties (whether or not any such losses were foreseeable or within the contemplation of the parties). This means, by way of example only (and without limiting the scope of the above), that if the Trust claims that the Bitcoin Custodian failed to process a withdrawal request properly, the Trust s damages are limited to no more than the value of the bitcoin at issue in the withdrawal request, and that the Trust may not recover for lost profits, lost business opportunities, or other types of special, incidental, indirect, intangible, or consequential damages in excess of the value of the bitcoin at issue in the withdrawal. The Bitcoin Custodian shall not be liable to the Trust or anyone else for any loss or injury resulting directly or indirectly from any damage or interruptions caused by any computer viruses, spyware, scamware, trojan horses, worms, or other malware that may affect the Trust s computer or other equipment, provided such malware did not originate from the Bitcoin Custodian or its agents. The Bitcoin Custody Agreement provides that the Bitcoin Custodian has obtained insurance coverage by a reputable insurance company with respect to digital assets custodied with the Bitcoin Custodian, in accordance with its internal standards for maintaining such insurance and subject to change at the Bitcoin Custodian s discretion. The Bitcoin Custody Agreement provides that the Bitcoin Custodian shall provide the Trust with notice of material changes in its insurance coverage. The Bitcoin Custody Agreement will commence on the date of execution and continue until terminated in accordance with its provisions. The Bitcoin Custody Agreement may be terminated by either party upon 90 days written notice to the other party; provided, however, that if the Bitcoin Custody Agreement is terminated, the Bitcoin Custodian shall use commercially reasonable efforts to cooperate with the Trust s transition to a replacement custodian and if the Trust is unable to engage a replacement custodian using commercially reasonable efforts within such 90 day period, the Bitcoin Custodian terminates the Bitcoin Custody Agreement, then the Bitcoin Custodian shall continue to act as Bitcoin Custodian pursuant to the terms of the Bitcoin Custody Agreement until such time as the Trust engages a replacement custodian, provided that the Trust uses reasonable commercial efforts to promptly engage a replacement custodian. Either party (the "Terminating Party") may terminate the Bitcoin Custody Agreement at any time on written notice to the other party (the "Defaulting Party"), such termination to take effect (i) on the tenth business day after the delivery of written notice of termination by the Terminating Party to the Defaulting Party, unless the Defaulting Party has cured the event triggering a termination right to the satisfaction of the Terminating Party, acting reasonably, or (ii) immediately after delivery of written notice of termination by the Terminating Party to the Defaulting Party if the event triggering a termination right is incapable of being cured within ten business days, in the following circumstances. First, any representation, warranty, certification or statement made by the Defaulting Party under the Bitcoin Custody Agreement was or becomes incorrect in any material respect when made; second, the Defaulting Party materially breaches, or fails in any material respect to perform any of its obligations under, the Bitcoin Custody Agreement; third, the Defaulting Party requests a postponement of maturity or a moratorium with respect to any indebtedness or is adjudged bankrupt or insolvent, or there is commenced against the Defaulting Party a case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, or the Defaulting Party files a petition for bankruptcy or an application for an arrangement with its creditors, seeks or consents to the appointment of a receiver, administrator or other similar official for all or any substantial part of its property, admits in writing its inability to pay its debts as they mature, or takes any corporate action in furtherance of any of the foregoing, or fails to meet applicable legal minimum capital requirements; fourth, a Change of Control (as defined in the Bitcoin Custody Agreement) of the Defaulting Party, or an event, change or development that causes or is likely to cause a Material Adverse Effect (as defined in the Bitcoin Custody Agreement) on the Defaulting Party, or in the ability of the Defaulting Party to fulfill its responsibilities under the Bitcoin Custody Agreement, occurs; fifth, with respect to the Trust s right to terminate, the Bitcoin Blockchain undergoes a fork and becomes a forked network, and the Trust disagrees with the Bitcoin Custodian s choice of which forked network to support; or with respect to the Trust s right to terminate, applicable laws and regulations or any change therein or in the interpretation or administration thereof that may have a Material Adverse Effect (as defined in the Bitcoin Custody Agreement) on the Trust or the rights of the Trust with respect to any services covered by the Bitcoin Custody Agreement. The Bitcoin Custodian has the right to immediately (i) take actions the Bitcoin Custodian determines appropriate to comply with applicable law and regulations and in accordance with its Bank Secrecy Act and Anti-Money Laundering compliance program ("BSA/AML Program"), (ii) suspend the Fund s bitcoin Account or Fiat Account, (iii) freeze/lock the funds and assets in all such accounts, and (iv) suspend the Trust s access to the Bitcoin Custodian s platform or its account there (collectively, an "account suspension"), if: (A) the Bitcoin Custodian is required to do so by a regulatory authority, court order, facially valid subpoena, or binding order of a governmental authority, (B) the Bitcoin Custodian reasonably and in good faith believes the Trust has violated applicable laws and regulations in connection with the Fund s bitcoin Account or Fiat Account, or the Bitcoin Custodian is required to do so under the Bitcoin Custodian s BSA/AML Program, (C) the Bitcoin Custodian believes someone is attempting to gain unauthorized access to the account, or (D) the Bitcoin Custodian believes there is unusual activity in the account. Except as set forth above, the Bitcoin Custodian shall not suspend the Trust s access to the Bitcoin Account or the Fiat Account, and any suspension of the Trust s access to such accounts shall constitute a breach of the Bitcoin Custody Agreement. In the case of an account suspension due to (C) or (D) of this paragraph, the Bitcoin Custodian shall restore the Trust s normal access to the Bitcoin Account or Fiat Account as promptly as reasonably possible without putting the bitcoin and fiat currency in such accounts at risk. In the case of an account suspension due to (A) or (B) of this paragraph, the Bitcoin Custodian shall permit the Trust to withdraw the Fund s bitcoin and fiat currencies from Bitcoin Account or Fiat Account as soon as permitted by applicable laws and regulations or the applicable court order, subpoena, or regulatory or governmental authority, and for ninety (90) days thereafter. Non-Digital Custodian In its capacity as the Non-Digital Custodian, currently U.S. Bank, N.A., holds the Fund s securities, cash and/or cash equivalents pursuant to a custodial agreement. The Non-Digital Custodian is located at 1555 North Rivercenter Drive, Suite 302, Milwaukee, Wisconsin 53212. U.S. Bank, N.A. is a nationally chartered bank, regulated by the Office of the Comptroller of the Currency, Department of the Treasury, and is subject to regulation by the Board of Governors of the Federal Reserve System. Non-Digital Custody Agreement. Under the Non-Digital Custody Agreement between the Non-Digital Custodian, Sponsor, and the Trust, upon the Sponsor s instructions, the Non-Digital Custodian will establish and maintain a segregated account or accounts for and on behalf of a Fund, into which account or accounts may be transferred cash and/or securities. Upon instructions from the Trust or Sponsor, the Non-Digital Custodian will facilitate the transfer and management of assets, including cash, within the Trust s account(s). The Non-Digital Custodian s fees are payable by the Trust, however, the Sponsor assumes such fees via the Sponsorship Agreement with the Trust. The Non-Digital Custody Agreement specifies an initial term of three years, with automatic renewal for successive one-year terms unless terminated earlier in accordance with the terms of the Agreement. Either party can terminate the Agreement under certain conditions, such as material breach or failure to pay fees within a specified period. Additionally, the Agreement may be terminated by the Trust for causes such as prolonged force majeure events, legal requirements, or significant corporate events affecting the Non-Digital Custodian. In performing its duties, the Non-Digital Custodian is required to exercise due care in accordance with reasonable commercial standards. The Non-Digital Custodian is generally not liable for any error of judgment or mistake of law or for any loss suffered by the Trust in connection with its duties under the Agreement, except a loss arising out of or relating to the Custodian s refusal or failure to comply with the terms of the Agreement or from the Custodian s bad faith, negligence or willful misconduct in the performance of its duties under this Agreement. Liability of the Non-Digital Custodian under the Agreement is generally limited to direct damages caused by its failure to perform its obligations in accordance with the agreed standard of care. The Trust is obligated to indemnify the Non-Digital Custodian against losses, expenses, damages, and liabilities incurred in the performance of its duties under the Agreement, except where such issues arise from the Non-Digital Custodian s failure to meet the agreed standard of care. The Trust retains the discretion to appoint additional custodians as necessary to manage its assets, subject to the terms of separate agreements. The Sponsor has the authority to add or terminate Custodians as deemed appropriate. The governing law for the Non-Digital Custody Agreement is the laws of the State of Minnesota. The Fund is subject to various risks associated with the potential insolvency of the Non-Digital Custodian. In the event of the Non-Digital Custodian s insolvency, the Fund s assets held under custody might be subject to legal and financial complexities, which would subject the Fund to the following risks: Access to Assets: In the case of the Non-Digital Custodian s insolvency, there may be delays or difficulties in accessing the Fund s assets held by the Non-Digital Custodian. This situation could impact the Fund s ability to meet its financial obligations or to execute its investment strategies promptly. Asset Recovery and Transfer: The process of recovering and transferring assets to a new custodian in the event of insolvency may prove time-consuming and complex. This process might involve legal proceedings and negotiations, potentially leading to a prolonged period during which the assets are not actively managed or are inaccessible. Financial Losses: The Fund may incur financial losses if the assets held by the Non-Digital Custodian are entangled in insolvency proceedings. The Fund might not recover the full value of its assets, particularly if any part of the assets becomes part of the Non-Digital Custodian s bankruptcy estate. Operational Disruptions: Transitioning to a new custodian may cause operational disruptions. This includes administrative burdens, potential errors during the transfer of records and assets, and the need to establish new operational protocols. In addition to the foregoing risks, the Fund would be subject to additional risks if the Custody Agreement is terminated, which include: Cost Implications: Terminating the agreement and engaging a new custodian might incur additional costs, including early termination fees, transfer fees, and higher fees charged by a new custodian. Continuity of Service: There is a risk of service interruptions during the transition period, which might affect the Fund s ability to execute transactions and manage its assets effectively. Marketing Agent The Fund employs Foreside Fund Services, LLC, a wholly-owned subsidiary of Foreside Financial Group, LLC (d/b/a ACA Group) as the Marketing Agent for the Fund. The Marketing Agent s principal business address is Three Canal Plaza, Suite 100, Portland, Maine 04101. The Marketing Agent Agreement among the Marketing Agent, the Sponsor, and the Trust calls for the Marketing Agent to work with the Cash Custodian in connection with the receipt and processing of orders for Creation Baskets and Redemption Baskets and the review and approval of all Fund sales literature and advertising material. The Marketing Agent is a broker-dealer registered with the U.S. Securities and Exchange Commission ("SEC") and a member of FINRA. Marketing Agent Agreement. Under the Marketing Agent Agreement, the Trust engaged the Marketing Agent to perform marketing services. The Marketing Agent is registered as a broker-dealer under the Securities Exchange Act of 1934 and a member of FINRA. The Marketing Agent s services include assisting with Authorized Participant Agreements, maintaining creation and redemption order confirmations, providing Prospectuses to Authorized Participants, ensuring compliance with SEC and FINRA advertising rules, and approving marketing materials. The Trust, in turn, is responsible for creating, issuing, and redeeming Creation Units, providing the Marketing Agent with necessary documentation, and ensuring the availability of Prospectuses and Statements of Additional Information. The Trust is obligated to indemnify the Marketing Agent against losses arising from its breach of obligations or non-compliance with laws, except for losses resulting from the Marketing Agent s provision of inaccurate information. Conversely, the Marketing Agent will indemnify the Trust for losses arising from its breach of the agreement or failure to comply with applicable laws. The agreement sets out that the Marketing Agent is not entitled to compensation or reimbursement of expenses from the Trust, with any such remuneration to be paid by the Sponsor under a separate agreement (the Marketing Agent Services Agreement). The term of the agreement is two years, with provisions for automatic renewal and termination options available to both parties. Confidential information is protected under the agreement, with specific obligations for non-disclosure and non-use, along with provisions for regulatory disclosure and information security. The agreement is governed by Delaware law. Bitcoin Advisers 7RCC Global Inc. ("7RCC") serves as a "Bitcoin Adviser" to the Fund. 7RCC has its principal offices at 90 Alton Rd, Suite 1105, Miami Beach, FL 33139. 7RCC, established in 2021, is an alternative investment manager specializing in bridging the digital asset industry with environmentally conscious investment strategies. The firm focuses on developing innovative financial products that align with Environmental, Social, and Governance principles, catering to investors seeking sustainable investment opportunities. The team at 7RCC comprises professionals with extensive backgrounds in financial markets, blockchain technology, and sustainable investment practices. Their collective expertise enables the firm to design and manage investment products that align with both financial performance and environmental responsibility. As Bitcoin Adviser, 7RCC is responsible for providing the Sponsor and Administrator with research and analysis regarding bitcoin, the bitcoin markets and carbon neutralization structures for use in the operation and marketing of the Fund. The Bitcoin Adviser does not have any responsibility for the investment or management of the Fund s portfolio or for the overall performance or operation of the Fund. Support Agreement The Sponsor, Tidal, and 7RCC (collectively, the "Parties") have entered into an agreement, as amended (the "Support Agreement") that sets forth the terms and conditions applicable to the launch, marketing, promotion, development, and ongoing operation of the Fund, as well the respective rights in profits and obligations for expenses. Specifically, 7RCC and the Sponsor have experience in the digital asset and exchange-traded fund industry, and seek to offer a fund offering bitcoin and Carbon Credit Futures exposure as part of their long-term business goals. The primary responsibilities and rights of each Party under the Support Agreement, with respect to the Fund are described below: The Sponsor will serve as the sponsor of the Fund as a series of the Trust, as described in this prospectus. Administrator will provide fund administration and related services for the Fund. 7RCC will provide to the Sponsor research and analysis regarding bitcoin and bitcoin markets for use in the operation and marketing of the Fund. After a deduction of operational costs from the Management Fee, 7RCC will receive the benefit of any resulting profits and will be responsible for paying any losses. Pursuant to the Support Agreement, 7RCC receives remaining proceeds generated from the Management Fee after the payment of the Fund s expenses. The Support Agreement terminates at the earlier of: (1) the withdrawal of the Registration Statement; (2) 30 days after an uncured material breach by a party to the Support Agreement; (3) upon ninety (90) days prior written notice by a party to the other parties (or such lesser period of time as may be necessary pursuant to law, rule, regulation or court order) if any legislation or regulation is adopted or any government interpretation is issued that prevents that party from fulfilling any of its material obligations contained in the Support Agreement; or (iv) upon the parties mutual written agreement. Commodity Trading Advisor Currently, the Sponsor does not employ commodity trading advisors for the Fund. If, in the future, the Sponsor does employ commodity trading advisors, it will choose each advisor based on arm s length negotiations and will consider the advisor s experience, fees, and reputation. Clearing Brokers StoneX Financial Inc. – FCM Division (f/k/a INTL FCStone Financial Inc. - FCM Division) ("StoneX") serves as the Fund s clearing brokers (the "Clearing Broker") to execute and clear the Fund s futures transactions and provide other futures brokerage-related services. The Clearing Broker is registered as an FCM with the CFTC, is a member of the National Futures Association ("NFA") and is a clearing member of all major U.S. futures exchanges. The Clearing Broker is also a registered as broker-dealer with the SEC and is a member of FINRA Except as indicated below, there have been no material civil, administrative, or criminal proceedings pending, on appeal, or concluded against the Clearing Brokers or their principals in the past five (5) years. Litigation Disclosure for StoneX. Listed below are material administrative, civil, enforcement, or criminal complaints or actions filed against StoneX Financial Inc. – FCM Division (f/k/a INTL FCStone Financial Inc. - FCM Division) where such complaints or actions have not concluded and any material enforcement actions or complaints filed against the StoneX Financial Inc. - FCM Division in the past three years. On March 16, 2023, the Clearing House Risk Committee at CME Group found that StoneX Financial, Inc. violated Customer Gross Margining Technical Overview Requirements and CME Rule 980.G. Pursuant to an offer of settlement in which StoneX Financial, Inc. neither admitted nor denied the rule violations upon which the penalty is based, the Clearing House Risk Committee imposed a $100,000.00 fine which was effective on March 16, 2023. On January 20, 2023, the Clearing House Risk Committee at CME Group found that StoneX Financial Inc. violated CME Rules 930.A and 930.F. Pursuant to an offer of settlement in which StoneX Financial, Inc. neither admitted nor denied the rule violations upon which the penalty is based, the Clearing House Risk Committee imposed a $50,000 fine which was effective on January 20, 2023. On December 15, 2022, the Market Regulation Department of CME notified StoneX Financial Inc. ("SFI") that it was conducting a formal investigation into block trades placed in September 2022 that could potentially be in violation of CME Rule 526 and Market Regulation Advisory Notice RA2004-5R. On July 6, 2023, CME notified SFI that it has referred the case to Market Regulation s Enforcement Division. Settlement negotiations are ongoing. On July 20, 2022, a subcommittee on the ICE Future US s Business Conduct Committee determined that in numerous instances between May 2020 and May 2021 StoneX Financial Inc. and StoneX Markets LLC may have violated Exchange Rule 4.04 by engaging in improper pre-hedging and adopting a risk policy that may have motivated employees to engage in improper pre-hedging for certain contracts. In addition, the Committee found that StoneX Financial Inc. and StoneX Markets LLC may have violated Exchange Rules 4.01(a), 4.07(c), and 21.04. In accordance with the settlement offer, in which StoneX Financial Inc. and StoneX Markets LLC neither admitted nor denied the alleged rule violations, StoneX Financial Inc. and StoneX Markets LLC agreed to pay a collective monetary penalty of $425,000 and disgorge $225,606.80 in profits. On March 23, 2021, a subcommittee of the ICE Futures US s Business Conduct Committee determined that in numerous instances between February 2019 and May 2020, StoneX Financial Inc. ("StoneX"), formerly INTL FCStone Financial Inc., may have violated Exchange Rule 6.15(a) by failing to submit to the Exchange daily large trader reports on reportable customer positions and Exchange Rule 4.01(a) by failing to have proper processes for reporting large trader positions. The ICE Futures US Business Conduct Committee imposed a $75,000 fine on StoneX Financial Inc. which was effective on March 23, 2021. After a historic move in the natural gas market in November of 2018, INTL FCStone Financial Inc. – FCM Division ("IFF") experienced a number of customer deficits. IFF soon thereafter initiated NFA arbitrations, seeking to collect these debits, and has also been countersued and sued in a number of these arbitrations. These accounts were managed by Optionsellers.com, ("Optionsellers") who is a Commodity Trading Advisor ("CTA") authorized by investors to act as attorney-in-fact with exclusive trading authority over these investors trading accounts. These accounts cleared through IFF. After this significant and historic natural gas market movement, the accounts declined below required maintenance margin levels. IFF s role in managing the accounts was limited. As a clearing firm, IFF did not provide any investment advice, trading advice, or recommendations to customers of Optionsellers who chose to clear with IFF. Instead, it simply executed and cleared trades placed by Optionsellers on behalf of Optionsellers customers. Optionsellers is a CFTC registered CTA operating under a CFTC Rule 4.7 exemption from registration. Optionsellers engaged in a strategy that primarily involved selling options on futures products. The arbitrations between IFF, Optionsellers, and the Optionsellers customers are currently ongoing. Further, StoneX Financial Inc. is subject to litigation and regulatory enforcement in the normal course of business. Except as discussed above, the current or pending civil litigation or administrative proceedings in which StoneX Financial Inc. is involved are not expected to have a material effect upon its condition, financial or otherwise. StoneX Financial Inc. vigorously defends, as a matter of policy, civil litigation, reparation, arbitration proceedings, and enforcement actions brought against it. AUTHORIZED Purchasers An Authorized Purchaser must enter into an "Authorized Purchaser Agreement" with the Sponsor and the Trust, on behalf of the Fund, to govern its placement of orders to create and redeem Baskets. The Authorized Purchaser Agreement sets forth the procedures for the creation and redemption of Baskets. The Authorized Purchaser Agreement also provides the Sponsor and the Administrator with the authority to terminate the relationship with an Authorized Purchaser if the Sponsor or Administrator determines that an Authorized Purchaser does not to comply with the regulatory and registration requirements promulgated by FinCEN or other state authorities. Each Authorized Purchaser must (i) be a registered broker-dealer and (ii) enter into an Authorized Purchaser Agreement with the Sponsor, the Administrator and the Marketing Agent. A list of the current Authorized Purchasers can be obtained from the Sponsor. The Trust, on behalf of the Fund, has engaged Jane Street Capital, LLC, Citadel Securities LLC and Goldman Sachs & Co. LLC as Authorized Purchasers. JSCT, LLC (an affiliate of Jane Street Capital, LLC) is also a Bitcoin Trading Counterparty of the Fund. Additional Authorized Purchasers may be added at any time, subject to the discretion of the Sponsor. CALCULATION OF NAV Calculating the Fund s NAV per Share The Fund s NAV per Share is calculated by: taking the current market value of its total assets; subtracting any liabilities; and dividing that total by the total number of outstanding Shares. The Administrator calculates the NAV of the Fund once each trading day. It will calculate the NAV as of the earlier of the close of the Exchange or 4:00 p.m. (ET). The NAV for a normal trading day will be released after 4:00 p.m. (ET). To the extent there are any determinations that the Sponsor and the Administrator make, such determinations will be made in good faith upon the basis of, and neither the Sponsor nor the Administrator will be liable for any errors contained in, information reasonably available. Neither the Sponsor nor the Administrator will be liable to The Depository Trust Company ("DTC"), Authorized Purchasers, the Shareholders or any other person for errors in judgment. The Fund s daily activities are generally not reflected in the NAV determined for the Business Day on which the transactions are effected (the trade date), but rather on the following Business Day. The Sponsor has the exclusive authority to determine the NAV of the Fund. The Sponsor has delegated to the Administrator the responsibility to calculate the NAV and NAV per Share of the Fund, based on a pricing source selected by the Sponsor. The Administrator will determine the NAV of the Fund each business day. In determining the NAV of the Fund, the Administrator values the bitcoin held by the Fund based on the Bitcoin Price calculated by the Index, unless otherwise determined by the Sponsor in its sole discretion. See "Investment Objective and Investment Strategies—Principal Investment Strategies—Bitcoin Valuation" for additional information regarding the calculation methodology of the Bitcoin Price. If the Bitcoin Price is not available or the Sponsor in its sole discretion determines that the Bitcoin price should not be used, the Fund s holdings may be fair valued in accordance with the policy approved by the Sponsor. The Sponsor does not anticipate the need to "fair value" bitcoin will be a common occurrence. The Administrator will value the Fund s Carbon Credit Futures using the same methodology of the Index (and respective Sub-index), as detailed in the "Investment Objective and Investment Strategies—Principal Investment Strategies—The Index—Carbon Credit Futures Sub-indexes" subsection on page [ ]. Specifically, the EU CEA Carbon Credit Futures will be valued with the settlement price at closing on the primary trading exchange. The CCA Carbon Credit Futures and RGGI Carbon Credit Futures will be valued at the last trading price as of 4:00 pm ET. If the Sponsor in its sole discretion determines that the this price does not reflect the accurate value of a given Carbon Credit Future, then the Sponsor will instruct the Administrator to employ an alternative method to determine the fair value of the Fund s assets. In determining an alternative fair value method, the Sponsor may consider such criteria as observable market-based inputs, including market quotations and/or trading platforms on which Carbon Credit Futures are traded. The Sponsor does not anticipate that the need to "fair value" bitcoin or Carbon Credit Futures will be a common occurrence. Valuation of the Fund s Assets As discussed above, value of bitcoin is determined by the value that various market participants place on bitcoin through their transactions. On exchanges, bitcoin is traded with publicly disclosed valuations for each executed trade, measured by one or more fiat currencies such as the U.S. dollar. The Fund values the bitcoin held by the Fund based on the Bitcoin Price calculated by the Index for purposes of NAV. The Index requires each digital asset trading platform used to calculate the price of bitcoin to meet certain criteria, and the exchanges qualifying under such criteria are used to calculate the Bitcoin Price. Kaiko reviews the time-weighted average price between 3:00 pm and 4:00 pm ET and values bitcoin as the median value amongst the eligible platforms. The Sponsor believes this methodology provides a reasonable valuation of the spot price of bitcoin that is reasonably resistant to price manipulation of bitcoin. The value of the futures contracts held by the Fund will be based on market prices as of the time the NAV is calculated on each trading day. The Sponsor may determine to a price used for one or more of the futures contracts utilized by the Fund may need to be fair valued in accordance with the policy approved by the Sponsor. The Sponsor will monitor for significant events related to crypto assets that may impact the value of bitcoin and will determine in good faith, and in accordance with its valuation policies and procedures, whether to fair value the Fund s bitcoin and/or Carbon Credit Futures on a given day (e.g., if an Index Pricing Source or price of a Carbon Credit Future is not available). In certain circumstances, the Sponsor will determine whether to fair value the Fund s assets (bitcoin or Carbon Credit Futures) on a given day on whether certain pre-determined criteria have been met. For example, the Sponsor may fair value the Fund s bitcoin or Carbon Credit Futures using observed market transactions from one or more exchanges. The Sponsor may also fair value the Fund s bitcoin using a combination of inputs in certain situations (e.g., using observed market transactions, OTC quotations from brokers, etc.). Accordingly, the NAV of the Fund may reflect the fair value of bitcoin or Carbon Credit Futures rather than market prices on certain exchanges at 4:00 p.m. ET. Fair value pricing involves subjective judgments and it is possible that a fair value determination for bitcoin or Carbon Credit Futures may be materially different than the value that could be realized upon the sale of such bitcoin or Carbon Credit Future. In addition, fair value pricing could result in a difference between the prices used to calculate the Fund s NAV and the prices used by the Index (i.e., the Bitcoin Price and/or prices for the Carbon Credit Futures). The Sponsor, in conjunction with the Administrator, will work in good faith to determine the fair value and implement the correct pricing for the Fund s NAV. Intraday Indicative Value The NAV for a normal trading day will be released after 4:00 p.m. ET. Trading during the core trading session on the Exchange typically closes at 4:00 p.m. ET. However, NAVs are not officially struck until later in the day. In order to provide updated information relating to the Fund for use by Shareholders and market professionals, ICE Data Services, will calculate and disseminate throughout the core trading session on each trading day an updated intraday indicative value ("IIV"). ICE Data Services, will disseminate the IIV value through the facilities of CTA/CQ High Speed Lines. In addition, the indicative fund value will be published on the Exchange s website and will be available through on-line information services such as Bloomberg and Reuters. The IIV will be calculated by using the prior day s closing NAV per Share of the Fund as a base and updating that value throughout the trading day to reflect changes in the most recently reported price level of the Fund s bitcoin and Carbon Credit Futures during the trading day. The Fund s bitcoin holdings will be priced using the Blockstream Crypto Data Fees Streaming Level 1 as the pricing source. The Fund s Carbon Credit Futures will be priced using the last traded price for each contract on the relevant exchange for such Carbon Credit Future. Such last traded price will be obtained via the ICE Data Services Consolidated Feed. Changes in the value of cash equivalents are not included in the calculation of indicative value. For this and other reasons, the indicative fund value disseminated during Exchange hours should not be viewed as an actual real time update of the NAV. NAV is calculated only once at the end of each trading day. The IIV disseminated during the Exchange core trading session hours should not be viewed as an actual real time update of the NAV, because NAV per Share is calculated only once at the end of each trading day based upon the relevant end of day values of the Fund s investments. The IIV will be disseminated on a per Share basis, as calculated by a third-party financial data provider, every 15 seconds during regular Exchange core trading session hours of 9:30 a.m. ET to 4:00 p.m. ET by one or more major market vendors. The IIV may differ from the NAV due to the differences in the time window of trades used to calculate each price (the NAV uses a sixty-minute window, whereas the IIV draws prices from the last trade on each exchange in an effort to produce a relevant, real-time price). The Sponsor does not believe this will cause confusion in the marketplace, as Authorized Purchasers are the only Shareholders who interact with the NAV and the Sponsor will communicate its NAV calculation methodology clearly. There are many instances in the market today where the IIV and the NAV of an ETF are subtly different, whether due to the calculation methodology, market hours overlap or other factors. The Sponsor has seen limited or no negative impact on trading, liquidity or other factors for exchange-traded funds in this situation. The Sponsor believes that the IIV will closely track the globally integrated bitcoin price as reflected on the contributing Bitcoin Platforms. Dissemination of the IIV provides additional information that is not otherwise available to the public and is useful to Shareholders and market professionals in connection with the trading of the Fund s Shares on the Exchange. Shareholders and market professionals will be able throughout the trading day to compare the market price of the Fund and the IIV. If the market price of the Fund s Shares diverges significantly from the IIV, market professionals will have an incentive to execute arbitrage trades. For example, if the Fund appears to be trading at a discount compared to the IIV, a market professional could buy the Fund s Shares on the Exchange and sell short futures contracts. Such arbitrage trades can tighten the tracking between the market price of the Fund and the IIV and thus can be beneficial to all market participants. Calculation of Principal Market NAV and Principal Market NAV per Share The Fund s periodic financial statements may not utilize the NAV of the Fund determined by reference to the Index to the extent the methodology used to calculate the Bitcoin Price is deemed not to be consistent with GAAP. The Fund s periodic financial statements will be prepared in accordance with the Financial Accounting Standards Board ("FASB") Accounting Standards Codification Topic 820, "Fair Value Measurements and Disclosures" ("ASC Topic 820") and utilize an exchange-traded price from the Fund s principal market for bitcoin on the Fund s financial statement measurement date. The Sponsor will determine in its sole discretion the valuation sources and policies used to prepare the Fund s financial statements in accordance with GAAP. The Fund intends to engage a third-party vendor to obtain a price from a principal market for bitcoin, which will be determined and designated by such third-party vendor daily based on its consideration of several exchange characteristics, including oversight, and the volume and frequency of trades. Under GAAP, such a price is expected to be deemed a Level 1 input in accordance with the ASC Topic 820 because it is expected to be a quoted price in active markets for identical assets or liabilities. To determine which market is the Fund s principal market (or in the absence of a principal market, the most advantageous market) for purposes of calculating the Fund s financial statements, the Fund follows ASC 820-10, which outlines the application of fair value accounting. ASC 820-10 determines fair value to be the price that would be received for bitcoin in a current sale, which assumes an orderly transaction between market participants on the measurement date. ASC 820-10 requires the Fund to assume that bitcoin is sold in its principal market to market participants or, in the absence of a principal market, the most advantageous market. Market participants are defined as buyers and sellers in the principal or most advantageous market that are independent, knowledgeable, and willing and able to transact. The Fund may transact through Bitcoin Trading Counterparties, in multiple markets, and its application of ASC 820-10 reflects this fact. The Fund anticipates that, while multiple venues and types of markets will be available to the Bitcoin Trading Counterparties from whom the Sponsor acquires or disposes of the Fund s bitcoin, the principal market in each scenario is determined by looking at the market-based level of volume and bitcoin trading activity. Bitcoin Trading Counterparties, may transact in a Brokered Market, a Dealer Market, Principal-to-Principal Markets and Exchange Markets, each as defined in the FASB ASC Master Glossary. The Fund determines its principal market (or in the absence of a principal market the most advantageous market) on a quarterly basis to determine which market is its Principal Market for the purpose of calculating fair value for the creation of quarterly and annual financial statements. The process that the Sponsor has developed for identifying a principal market, as prescribed in ASC 820-10, which outlines the application of fair value accounting. The process begins by identifying publicly available, well established and reputable bitcoin trading venues (Exchange Markets, as defined in the FASB ASC Master Glossary), which are selected by the Sponsor and its affiliates in their sole discretion. The Sponsor then, through a service provider, calculates on each valuation period, the highest volume venue during the 60 minute period prior to 4:00 ET for bitcoin. The Sponsor then identifies that market as the principal market for bitcoin during that period, and uses the price for bitcoin from that venue at 4:00 ET as the principal market price. conflicts of interest General There are present and potential future conflicts of interest in the Trust s structure and operation you should consider before you purchase Shares. The Sponsor may use this notice of conflicts as a defense against any claim or other proceeding made. The Sponsor s principals, managers, officers and employees, do not devote their time exclusively to the Fund. Notwithstanding obligations and expectations related to the management of the Sponsor, the Sponsor s principals, officers and employees may be directors, officers or employees of other entities, and may manage assets of other entities, including the other funds of the Trust, through the Sponsor or otherwise. As a result, the principals could have a conflict between responsibilities to the Fund on the one hand and to those other entities on the other. The Sponsor and its principals, officers and employees may trade securities, futures and related contracts for their own accounts, creating the potential for preferential treatment of their own accounts. Shareholders will not be permitted to inspect the trading records of such persons, or any written policies of the Sponsor related to such trading. A conflict of interest may exist if their trades are in the same markets and at approximately the same times as the trades for the Fund. A potential conflict also may occur when the Sponsor s principals trade their accounts more aggressively or take positions in their accounts that are opposite, or ahead of, the positions taken by the Fund. The Sponsor has sole current authority to manage the investments and operations of the Fund, and this may allow it to act in a way that furthers its own interests which may create a conflict with your best interests, including the authority of the Sponsor to allocate expenses to and between the funds of the Trust. Shareholders have very limited voting rights with respect to the Fund, which will limit the ability to influence matters such as amendment of the Trust Agreement, change in the Fund s basic investment policies, or dissolution of the Fund or the Trust. The Sponsor serves as the Sponsor to the Fund and serves as the sponsor or investment adviser to investment companies and commodity pools other than the Fund. The Sponsor may have a conflict to the extent that its trading decisions for the Fund may be influenced by the effect they would have on the other investment companies or pools it manages. In addition, the Sponsor may be required to indemnify the officers and directors of the other investment companies or pools, if the need for indemnification arises. This potential indemnification will cause the Sponsor s assets to decrease. If the Sponsor s other sources of income are not sufficient to compensate for the indemnification, it could cease operations, which could in turn result in Fund losses and/or termination of the Fund. There are present and potential future conflicts of interest in the Fund s structure and operation you should consider before you purchase Shares. The Sponsor will use this notice of conflicts as a defense against any claim or other proceeding made. If the Sponsor is not able to resolve these conflicts of interest adequately, it may impact the Fund s ability to achieve its investment objectives. The officers, directors and employees of the Sponsor do not devote their time exclusively to the Fund. These persons are directors, officers or employees of other entities, or otherwise work in respect of other clients, which may compete with the Fund for their services. They could have a conflict between their responsibilities to the Fund and to those other entities. If the Sponsor acquires knowledge of a potential transaction or arrangement that may be an opportunity for the Fund, it shall have no duty to offer such opportunity to the Fund. The Sponsor will not be liable to the Fund or the Shareholders for breach of any fiduciary or other duty if the Sponsor pursues such opportunity or directs it to another person or does not communicate such opportunity to the Fund and is not required to share income or profits derived from such business ventures with the Fund. The Sponsor might have a potential future conflict of interest if the Sponsor, a new sponsor, or sub-adviser were to register as a broker-dealer or become affiliated with a broker-dealer. In such case, the Sponsor, new sponsor, or sub-adviser, as the case may be, would develop and implement appropriate procedures designed to prevent the use and dissemination of material non-public information regarding the Fund s holdings. Under its code of ethics (the "COE"), the Sponsor and its affiliates are required to adhere to a series of prescribed steps prior to engaging in trading activities, including transactions involving the Fund s Shares or bitcoin futures contracts. The preliminary step requires employees to seek pre-clearance for any trade in Covered Securities, which is a broad category encompassing various financial instruments, including stocks, bonds, and derivatives such as bitcoin futures. This pre-clearance is obtained by submitting a detailed request via an online Compliance Portal, which is then reviewed by the Sponsor s Chief Compliance Officer ("CCO") or designee. The COE specifies certain transactions that require heightened oversight, including participation in initial public offerings ("IPOs"), secondary offerings, and private placements. Employees must obtain not just pre-clearance but also direct approval from the CCO for such activities. Furthermore, the code strictly prohibits trading based on non-public, material information, commonly known as front-running, to prevent any potential conflicts with client interests and maintain the integrity of client transactions. Reporting is another critical aspect of the COE. Employees are mandated to file detailed reports of their trading activities on a quarterly basis, as well as annual reports detailing their holdings. These reports are subject to review by the CCO to identify any potential or actual conflicts of interest or indications of unethical behavior. Exemptions from these reporting requirements are limited and well-defined, applying mainly to accounts that are managed by independent third-party managers over which the employee has no direct control or influence. The COE provides a structured compliance framework that outlines procedures for reminders and steps to address instances of late or missed report submissions. Should these situations occur, the COE sets out a clear process for enacting disciplinary measures. This framework is designed to support a trading environment that aligns with regulatory expectations. Resolution of Conflicts The Trust Agreement provides that whenever a conflict of interest exists between the Sponsor or any of its affiliates, on the one hand, and the Trust or any Shareholders or any other person, on the other hand, the Sponsor will resolve such conflict of interest considering the relative interest of each party (including its own interest) and the benefits and burdens relating to such interests, any customary or accepted industry practices, and any applicable accepted accounting practices or principles. In the absence of fraud, gross negligence or willful misconduct by the Sponsor, the resolution, action or terms so made, taken or provided by the Sponsor shall not constitute a breach of this Trust Agreement or any other agreement contemplated herein or of any duty or obligation of the Sponsor at law or in equity or otherwise. privacy policy The following discussion is qualified in its entirety by reference to the privacy policy. A copy of the privacy policy is available at https://www.tidalfinancialgroup.com/privacy-policy/. The Sponsor, the Trust, and the Fund have adopted a privacy policy relating to the collection, maintenance, and use of nonpublic personal information about the Fund s current and former investors, as required under federal law. Federal law gives investors the right to limit some but not all sharing of their nonpublic personal information. Federal law also requires the Sponsor to tell investors how it collects, Shares, and protects such nonpublic personal information. Collection of Nonpublic Personal Information The Sponsor may collect or have access to nonpublic personal information about current and former Fund investors for certain purposes relating to the operation of the Fund. This information may include information received from investors, such as their name, social security number, telephone number, and address, and information about investors holdings and transactions in Shares of the Fund. Use and Disclosure of Nonpublic Personal Information The Sponsor does not sell nonpublic personal information to any third parties. The Sponsor primarily uses investors nonpublic personal information to complete financial transactions that may be requested. The Sponsor may disclose investors nonpublic personal information to third parties under specific circumstances described in the privacy policy. These circumstances include, among others, information needed to complete financial transactions, information released at the direction of an investor, and certain information requested by courts, regulators, law enforcement, or tax authorities. Investors may not opt out of these disclosures. Investors nonpublic personal information, particularly information about investors holdings and transactions in Shares of the Fund, may be shared between and amongst the Sponsor and the Fund. An investor cannot opt-out of the sharing of nonpublic personal information between and amongst the Sponsor and the Fund. However, the Sponsor and the Fund will not use this information for any cross-marketing purposes. In other words, all investors will be treated as having "opted out" of receiving marketing solicitations from the Fund. Protection of Nonpublic Personal Information As described in the privacy policy, the Sponsor takes safeguards to protect investors nonpublic personal information, which include, among others, restricting access to such information, requiring third parties to follow appropriate standards of security and confidentiality, and maintaining physical, technical, administrative, and procedural safeguards. The Sponsor s Website is hosted in the United States and any data provided to the Sponsor is stored in the United States. If you choose to provide Personal Data from regions outside of the United States, then by your submission of such data, you acknowledge and agree that: (a) you are transferring your personal information outside of those regions to the United States voluntarily and with consent; (b) the laws and regulations of the United States shall govern your use of the provision of your information, which laws and regulations may differ from those of your country of residence; and (c) you permit your personal information to be used for the purposes herein and in the Privacy Policy above. EXPENSES Expenses to Be Paid by the Sponsor The Sponsor has agreed to assume the following fees and expenses incurred by the Trust: the Marketing Fee, the Administrator Fee, each respective Custodian Fee, the Transfer Agent Fee, the Trustee fee, applicable license fees, including the licensing fees related to the Index License Agreement, fees and expenses related to public trading of the Shares on the Exchange (including marketing, legal and audit fees and expenses), legal expenses, audit fees, regulatory fees, including any fees relating to the registration of the Shares with the SEC, printing and mailing costs and costs of maintaining the Fund s website. There is no cap on expenses for the above-listed fees payable by the Sponsor. Extraordinary and Other Expenses In certain extraordinary circumstances, the Fund may pay expenses in addition to the Management Fee, including, but not limited to, any expenses of the Fund that are not assumed by the Sponsor, taxes and governmental charges, expenses and costs of any extraordinary services performed by the Sponsor (or any other Service Provider) on behalf of the Fund, indemnification expenses of the Bitcoin Custodian and/or Non-Digital Custodian, Administrator or other agents, service providers or counterparties of the Fund and extraordinary legal fees and expenses, and all other transaction related fees and expenses charged in connection with trading activities for the Fund s investments and for maintenance of its CFTC regulatory status as a commodity pool (collectively, "Additional Fund Expenses"). When Additional Fund Expenses are incurred, the Fund will be required to pay these Additional Fund Expenses too. Although the Sponsor cannot definitively state the frequency or magnitude of the Additional Fund Expenses, with the exception of transaction related fees and expenses and for maintenance of its CFTC regulatory status as a commodity pool, the Sponsor expects that they may occur infrequently, if at all. Payment of Expenses To pay the Management Fee, the Sponsor is paid in U.S. dollars. In paying the Management Fee, the Sponsor may need to direct the Fund s bitcoin to be exchanged for U.S. dollars and Carbon Credit Futures to be sold. Under such circumstances, the Sponsor will utilize an approved Bitcoin Trading Counterparty to exchange the Fund s bitcoin for U.S. dollars. The Non-Digital Custodian will, when directed by the Sponsor, withdraw funds from the Trust s accounts to an account maintained by the Non-Digital Custodian for the Sponsor. Each sale of bitcoin by the Fund to pay the Management Fee or other Fund expenses will be a taxable event to Shareholders. In addition, if the Fund incurs any Additional Fund Expenses, the Sponsor will cause the Non-Digital Custodian to withdraw funds from the Fund s accounts in such quantity as may be necessary to permit payment of such Additional Fund Expenses. In order to pay for such Additional Fund Expenses, the Fund may need to sell bitcoin and/or Carbon Credit Futures, which it will do in a manner similar to the process defined above. Shareholders do not have the option of choosing to pay their proportionate shares of Additional Fund Expenses in lieu of having their shares of Additional Fund Expenses paid by the Fund. PROVISIONS OF LAW According to applicable law, indemnification of the Sponsor is payable only if the Sponsor determined, in good faith, that the act, omission or conduct that gave rise to the claim for indemnification was in the best interest of the Fund and the act, omission or activity that was the basis for such loss, liability, damage, cost or expense was not the result of negligence or misconduct and such liability or loss was not the result of negligence or misconduct by the Sponsor, and such indemnification or agreement to hold harmless is recoverable only out of the assets of the Fund. Provisions of Federal and State Securities Laws This offering is made pursuant to federal and state securities laws. The SEC and state securities agencies take the position that indemnification of the Sponsor that arises out of an alleged violation of such laws is prohibited unless certain conditions are met. These conditions require that no indemnification of the Sponsor or any underwriter for the Fund may be made in respect of any losses, liabilities or expenses arising from or out of an alleged violation of federal or state securities laws unless: (i) there has been a successful adjudication on the merits of each count involving alleged securities law violations as to the party seeking indemnification and the court approves the indemnification; (ii) such claim has been dismissed with prejudice on the merits by a court of competent jurisdiction as to the party seeking indemnification; or (iii) a court of competent jurisdiction approves a settlement of the claims against the party seeking indemnification and finds that indemnification of the settlement and related costs should be made, provided that, before seeking such approval, the Sponsor or other indemnitee must apprise the court of the position held by regulatory agencies against such indemnification. These agencies are the SEC and the securities administrator of the State or States in which the plaintiffs claim they were offered or sold interests. Provisions of the Securities Act Insofar as indemnification for liabilities arising under the Securities Act may be permitted to the Sponsor or directors, officers, or persons controlling the Fund, the Fund has been informed that the SEC believes that such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. MANAGEMENT; VOTING BY SHAREHOLDERS The Shareholders of the Fund take no part in the management or control, and have no voice in, the Fund s operations or business. Shareholders have no voting rights with respect to the Trust or the Fund except as expressly provided in the Trust Agreement. The Trust Agreement provides that Shareholders representing at least a majority (over 50%) of the outstanding Shares of the Fund together as a single class (excluding Shares acquired by the Sponsor in connection with its initial capital contribution to any Trust series) may vote to (i) continue the Trust by electing a successor Sponsor as described above, and (ii) approve amendments to the Trust Agreement that impair the right to surrender Redemption Baskets for redemption. (Trustee consent to any amendment to the Trust Agreement is required if the Trustee reasonably believes that such amendment adversely affects any of its rights, duties or liabilities.) In addition, Shareholders holding Shares representing seventy-five percent (75%) of the outstanding Shares of the Fund, voting together as a single class (excluding Shares acquired by the Sponsor in connection with its initial capital contribution to any Trust series) may vote to dissolve the Trust upon not less than ninety (90) days notice to the Sponsor. MEETINGS Meetings of the Trust s Shareholders may be called by the Sponsor and will be called by it upon the written request of Shareholders holding at least 25% of the outstanding Shares of the Trust or the Fund, as applicable (not including Shares acquired by the Sponsor through its initial capital contribution). The Sponsor shall deposit in the United States mail or electronically transmit written notice to all Shareholders of the Fund of the meeting and the purpose of the meeting, which shall be held on a date not less than 30 nor more than 60 days after the date of mailing of such notice, at a reasonable time and place. Where the meeting is called upon the written request of the Shareholders of the Fund, or any other Fund, as applicable, such written notice shall be mailed or transmitted not more than 45 days after such written request for a meeting was received by the Sponsor. BOOKS AND RECORDS The Trust keeps its books of record and account at the office of the Sponsor located at 234 West Florida Street, Suite 203, Milwaukee, Wisconsin 53204, or at the offices of the Administrator, or such office, including of an administrative agent, as it may subsequently designate upon notice. The books of account of the Fund are open to inspection by any Shareholder (or any duly constituted designee of a Shareholder) at all times during the usual business hours of the Fund upon reasonable advance notice to the extent such access is required under CFTC rules and regulations. The Trust keeps a copy of the Trust Agreement on file in the Sponsor s office, which will be available for inspection by any Shareholder at all times during the Sponsor s usual business hours upon reasonable advance notice. GOVERNING LAW; CONSENT TO DELAWARE JURISDICTION The rights of the Sponsor, the Trust, the Fund, DTC (as registered owner of the Trust s global certificate for Shares) and the Shareholders are governed by the laws of the State of Delaware. The Sponsor, the Trust, the Fund and DTC and, by accepting Shares, each DTC Participant and each Shareholder, consent to the exclusive jurisdiction of the courts of the State of Delaware and any federal courts located in Delaware. Such consent is not required for any person to assert a claim of Delaware jurisdiction over the Sponsor or the Trust. The Trust Agreement and the effect of every provision thereof shall control over any contrary or limiting statutory or common law of the State of Delaware, other than the Delaware Trust Statute. legal matters Litigation and Claims Except as described above, within the past 10 years of the date of this prospectus, there have been no material administrative, civil or criminal actions against the Sponsor, the Trust or the Fund, or any principal or affiliate of any of them. This includes any actions pending, on appeal, concluded, threatened or otherwise known to them. Legal Opinion Chapman and Cutler LLP has advised the Sponsor in connection with the Shares being offered. Chapman and Cutler LLP has also provided the Sponsor with its opinion with respect to U.S. federal income tax matters addressed herein in "Material U.S. Federal Income Tax Consequences." Certain opinions of counsel will be filed with the SEC as exhibits to the Registration Statement. Experts The financial statements of the Trust and management s assessment of the effectiveness of internal controls over financial reporting of the Trust incorporated by reference in reliance upon the reports of Tait, Weller, & Baker, LLP ("Tait Weller"), independent registered public accountants, upon the authority of said firm as experts in accounting and auditing. The financial statements of the Fund included in this prospectus have been so included upon the reliance upon the reports of Tait Weller, independent registered public accountants, upon the authority of said firm as experts in accounting and auditing. No expert hired by the Fund to give advice on the preparation of this offering document has been hired on a contingent fee basis, nor do any of them have any present or future expectation of interest in the Sponsor, Marketing Agent, Authorized Purchasers, Custodians/Administrator or other service providers to the Fund. Material U.S. FEDERAL INCOME TAX CONSEQUENCES The following discussion summarizes certain material U.S. federal income tax consequences of the ownership of Shares. This discussion does not describe all of the tax consequences that may be relevant to a beneficial owner of Shares in light of the beneficial owner s particular circumstances, including tax consequences applicable to beneficial owners subject to special rules, such as: financial institutions; dealers in securities; traders in securities or commodities that have elected to apply a mark-to-market method of tax accounting in respect thereof; persons holding Shares as part of a hedge, "straddle," integrated transaction or similar transaction; persons holding Shares acquired by them as part of a Creation Basket or redeeming Shares in exchange for the underlying bitcoins and/or carbon credit futures represented by the redeemed Shares; U.S. Holders (as defined below) whose functional currency is not the U.S. dollar; entities or arrangements classified as partnerships for U.S. federal income tax purposes; real estate investment trusts; regulated investment companies; and tax-exempt entities, including individual retirement accounts. This discussion applies only to Shares that are held as capital assets and does not address alternative minimum tax consequences or, except as explicitly discussed below, the consequences of the 3.8% Medicare surtax on net investment income. If an entity or arrangement that is classified as a partnership for U.S. federal income tax purposes holds Shares, the U.S. federal income tax treatment of a partner will generally depend on the status of the partner and the activities of the partnership. Partnerships holding Shares and partners in those partnerships are urged to consult their tax advisers about the particular U.S. federal income tax consequences of owning Shares. This discussion is based on the Code, administrative pronouncements, judicial decisions and final, temporary and proposed Treasury regulations as of the date hereof, changes to any of which subsequent to the date hereof may affect the tax consequences described herein. Prospective investors are urged to consult their tax advisers about the application of the U.S. federal income tax laws to their particular situations, as well as any tax consequences arising under the laws of any state, local or foreign taxing jurisdiction. Tax matters are complex, and the tax consequences of the purchase and holding of the Shares will depend on the particular facts of each investor s situation. You are advised to consult your own tax advisors with respect to the application to your own circumstances of the U.S. federal income tax rules described below and with respect to other federal, state, local, or foreign tax consequences to you before making an investment in the Shares. U.S. Federal Income Taxation of the Fund The Fund is classified as a corporation for U.S. federal income tax purposes, and as such is obligated to pay U.S. federal and applicable state and foreign corporate taxes on its taxable income. This differs from many investment companies, which elect to be treated as "regulated investment companies" under the Code in order to avoid income tax obligations at the entity level. Under current law, the Fund is not eligible to elect treatment as a regulated investment because the Fund s investments consist primarily of bitcoin. As a result, the Fund will be obligated to pay U.S. federal and state taxes on its taxable income unlike other investment companies which are not so obligated. The amount of taxes currently paid by the Fund will vary depending on the amount of income and gains derived from investments, and such taxes may reduce your return from an investment in the Fund. The Fund invests its assets primarily in bitcoin and carbon credit futures contracts. In the case of bitcoin, some of the carbon credit futures used by the Fund may be "Section 1256 contracts." Any gains or losses on Section 1256 contracts are generally considered 60% long-term and 40% short-term capital gains or losses (60/40) although certain foreign currency gains and losses from such contracts may be treated as ordinary in character. Also, Section 1256 contracts held by the Fund at the end of each taxable year are "marked to market" with the result that unrealized gains or losses are treated as though they were realized and the resulting gain or loss is treated as ordinary or 60/40 gain or loss. In the case of bitcoin, due to the new and evolving nature of digital assets and the absence of comprehensive guidance with respect to digital assets, many significant aspects of the U.S. federal income tax treatment of digital assets such as bitcoin are uncertain. Our dealings in or in connection with digital assets, as well as transactions in digital assets generally, could be subject to adverse tax consequences in the U.S., including as a result of changes in the legal regimes regulating digital assets, and our operating results, as well as the price of digital assets, could be adversely affected thereby. Many significant aspects of the U.S. federal income tax treatment of digital assets (including with respect to the amount, timing and character of income recognition) are uncertain. In 2014, the IRS released a notice (the "Notice") discussing certain aspects of digital assets for U.S. federal income tax purposes and, in particular, providing that such digital assets (1) are "property," (2) are not "currency" for purposes of the rules relating to foreign currency gain or loss and (3) may be held as a capital asset. In 2019, the IRS released a revenue ruling and a set of "Frequently Asked Questions" (the "Ruling & FAQs") that provide some additional guidance, including guidance to the effect that, under certain circumstances, hard forks of digital assets are taxable events giving rise to ordinary income and guidance with respect to the determination of the tax basis of digital assets. The Notice and the Ruling & FAQs, however, do not address other significant aspects of the U.S. federal income tax treatment of digital assets. We do not intend to request a ruling from the IRS on these or any other issues, and we will take positions on these and other U.S. federal income tax issues relating to digital assets that we believe to be reasonable. There can be no assurance that the IRS will agree with the positions we take, and it is possible that the IRS will successfully challenge our positions. There can be no assurance that the IRS will not alter its position with respect to digital assets in the future or that a court would uphold the treatment set forth in the Notice and the Ruling & FAQs. It is also unclear what additional guidance on the treatment of digital assets for U.S. federal income tax purposes may be issued in the future. Any such alteration of the current IRS positions or additional guidance could result in adverse tax consequences for us and could have an adverse effect on the value of bitcoin or other digital assets. Because of the evolving nature of digital assets, it is not possible to predict potential future developments that may arise with respect to digital assets. Such developments may increase the uncertainty with respect to the treatment of digital assets for U.S. federal income tax purposes. For example, the Notice addresses only digital assets that are "convertible virtual currency," and it is conceivable that we will hold certain types of digital assets that are not within the scope of the Notice. On November 15, 2021, President Biden signed the Infrastructure Investment and Jobs Act (the "IIJA") into law. The IIJA implements a set of comprehensive financial account information reporting rules that will apply to persons, including digital asset trading platforms and custodians, that regularly effect transfers of digital assets on behalf of other persons. In particular, these rules will require digital asset trading platforms and custodians to report digital asset transactions (including sales, exchanges and other transfers) effected on behalf of other persons on an annual return, in a manner similar to the current reporting rules for brokers that effect stock and other securities transactions on behalf of customers. The IRS issued proposed regulations on these rules on August 28, 2023. Under the proposed regulations the gross proceeds of sales or exchanges of digital assets must be reported for transactions that take place on or after January 1, 2025, and, in certain circumstances, gain or loss with respect to such sales or exchanges must be reported for transactions that take place on or after January 1, 2026. These rules, the effects of which may depend in significant part on regulations or other guidance from the IRS on their implementation, could create significant compliance burdens for us and our investors, and could affect the price of digital assets, which could have an adverse effect on our investments. Federal Income Taxation of Holders of the Fund s Shares — U.S. Shareholders The discussion under the heading "Federal Income Taxation of Holders of the Fund s Shares – U.S. Shareholders" (and all subheadings thereunder) applies to a beneficial owner of a Share for U.S. federal income tax purposes that is: an individual who is a citizen or resident of the U.S. for U.S. federal income tax purposes; a corporation, or other entity classified as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the U.S. or of any political subdivision thereof; or an estate or trust the income of which is subject to U.S. federal income taxation regardless of its source. Receipt of Distributions Distributions made to you by the Fund (other than distributions in redemption of Shares subject to Section 302(b) of the Code) will generally constitute dividends to the extent of your allocable share of the Fund s current or accumulated earnings and profits, as calculated for federal income tax purposes. Generally, a corporation s earnings and profits are computed based upon taxable income, with certain specified adjustments. To the extent that distributions to you exceed your allocable share of the Fund s current and accumulated earnings and profits, your tax basis in the Fund s Shares with respect to which the distribution is made will be reduced, which will increase the amount of any taxable gain (or decrease the amount of any tax loss) realized upon a subsequent sale or redemption of such Shares. To the extent you hold such Shares as a capital asset and have no further basis in the Shares to offset the distribution, you will report the excess as capital gain. Distributions treated as dividends under the foregoing rules generally will be taxable as ordinary income to you but may be treated as "qualified dividend income." Under current U.S. federal income tax law, qualified dividend income received by individuals and other non-corporate shareholders is taxed at long-term capital gain rates, which are currently at a maximum of either 15% or 20% depending on whether the shareholder s income exceeds certain threshold amounts. For a dividend to constitute qualified dividend income, the shareholder generally must hold the Shares paying the dividend for more than 60 days during the 121-day period beginning 60 days before the ex-dividend date, although a longer period may apply if the shareholder engages in certain risk reduction transactions with respect to the common stock. Dividends paid by the Fund are expected to be eligible for the dividends received deduction available to corporate shareholders under Section 243 of the Code. However, corporate shareholders should be aware that certain limitations apply to the availability of the dividends received deduction, including rules which limit the deduction in cases where (i) certain holding period requirements are not met, (ii) the corporate shareholder is obligated (e.g., pursuant to a short sale) to make related payments with respect to positions in substantially similar or related property, or (iii) the corporate shareholder s investment in Shares of the Fund is financed with indebtedness. Corporate shareholders should consult their own tax advisors regarding the application of these limitations to their particular situations. An additional 3.8% Medicare surtax is imposed on certain net investment income (including ordinary dividends received from the Fund and net gains from redemptions or other taxable dispositions of Fund Shares) of U.S. individuals, estates and trusts to the extent that such person s "modified adjusted gross income" (in the case of an individual) or "adjusted gross income" (in the case of an estate or trust) exceeds certain threshold amounts. Redemptions and Sales of Shares A redemption of common Shares will be treated as a sale or exchange of such Shares, provided the redemption either is not essentially equivalent to a dividend, is a substantially disproportionate redemption, is a complete redemption of a shareholder s entire interest in the Fund, or is in partial liquidation of the Fund. Redemptions that do not qualify for sale or exchange treatment will be treated as described in "Receipt of Distributions" above. Upon a redemption treated as a sale or exchange under the foregoing rules, or upon a sale of your Shares to a third party, you generally will recognize capital gain or loss equal to the difference between the cost of your Shares and the amount you receive when you sell them. Any such capital gain or loss will be a long-term capital gain or loss if you held the Shares for more than one year at the time of disposition. Long-term capital gains of certain non-corporate common shareholders (including individuals) are currently subject to U.S. federal income taxation at a maximum rate of either 15% or 20% depending on whether the shareholder s income exceeds certain threshold amounts. The deductibility of capital losses is subject to limitations under the Code. A federal excise tax on stock repurchases is expected to apply to the Fund in the event that the Fund repurchases its own Shares. The excise tax is one percent (1%) of the fair market value of Fund Share redemptions less the fair market value of Fund Share issuances (in excess of $1 million of fair market value) annually on a taxable year basis. This excise tax would be payable by the Fund, and not by any holder of Shares, although payment of the excise tax could reduce a shareholder s return on an investment in the Fund. Tax-Exempt Investors Employee benefit plans and most other organizations exempt from federal income tax, including individual retirement accounts and other retirement plans, are subject to federal income tax on their unrelated business taxable income (or "UBTI"). Because the Fund is classified as a corporation for federal income tax purposes, an owner of any of the Fund s Shares will not report on its federal income tax return any items of income, gain, loss, and deduction that are allocated to the Fund from its investments. Moreover, dividend income from, and gain from the sale of, corporate stock generally does not constitute UBTI unless the acquisition of the corporate stock is debt-financed. Therefore, a tax-exempt investor should not have UBTI attributable to the ownership, sale, or redemption of the Fund s Shares unless the tax-exempt investor s acquisition of the Shares was financed with debt. In general, Shares are considered to be debt-financed if the tax-exempt owner of the Shares incurred debt to acquire the Shares or otherwise incurred a debt that would not have been incurred if the Shares had not been acquired. Regulated Investment Company Investors The income and gain realized from an investment in the Fund s Shares by an investor that is a regulated investment company should constitute qualifying income for the purposes of the rules relating to regulated investment companies. Furthermore, the Fund s Shares will generally constitute "qualifying assets" for a regulated investment company, which are generally subject to a requirement that at least 50% of the regulated investment company s total assets must consist of qualifying assets at the end of each quarter, and the amount of Fund Shares owned by the regulated investment company may not constitute more than 5% of the value of the total assets held by the regulated investment company or more than 10% of the Fund s outstanding voting securities. Federal Income Taxation of Holders of the Fund s Shares — Non-U.S. Shareholders The discussion under the heading "Federal Income Taxation of Holders of the Fund s Shares – Non-U.S. Shareholders" applies to, and the term "Non-U.S. Shareholder" shall mean, a beneficial owner of a Share for U.S. federal income tax purposes that is: a nonresident alien individual; a foreign corporation; or a foreign estate or trust. Receipt of Distributions Distributions by the Fund will be treated as dividends for U.S. federal income tax purposes to the extent paid from the Fund s current or accumulated earnings and profits (as determined under U.S. federal income tax principles). Dividends paid by the Fund to a Non-U.S. Shareholder generally will be subject to withholding tax at a 30% rate or a reduced rate specified by an applicable income tax treaty. If a Non-U.S. Shareholder claims a reduced rate of withholding under an income tax treaty, the Non-U.S. Shareholder will be required to provide an IRS Form W-8BEN or IRS Form W-8BEN-E certifying its eligibility to benefits under the income tax treaty in order to obtain the reduced rate of withholding tax. If the amount of a distribution exceeds a Non-U.S. Shareholder s allocable share of the Fund s current and accumulated earnings and profits, such excess will be treated for U.S. federal income tax purposes as a tax-free return of capital to the extent of the Non-U.S. Shareholder s tax basis in the Fund s Shares. To the extent that any distribution received by a Non-U.S. Shareholder exceeds the sum of (i) such Non-U.S. Shareholder s allocable share of the Fund s current and accumulated earnings and profits and (ii) such Non-U.S. Shareholder s tax basis in the Fund s Shares, such excess will be treated as gain from the sale of the Shares and will be taxed as described in "Redemptions and Sales of Shares" below. Redemptions and Sales of Shares A redemption of the Fund s Shares will be treated as a sale or exchange of such Shares, provided the redemption either is not essentially equivalent to a dividend, is a substantially disproportionate redemption, is a complete redemption of a shareholder s entire interest in the Fund, or is in partial liquidation of the Fund. Redemptions that do not qualify as a sale or exchange will be treated as described in "Receipt of Distributions" above. A Non-U.S. Shareholder generally will not be subject to U.S. federal income tax on gain realized on a redemption that is treated as a sale or exchange for U.S. federal income tax purposes, or on gain realized on the sale, exchange or other non-redemption disposition of the Fund s Shares, except in the following situations: the gain is effectively connected with a trade or business of the Non-U.S. Shareholder in the U.S. or, if the Non-U.S. Shareholder is a qualifying resident of a country with which the U.S. has a tax treaty, such gain is attributable to a permanent establishment maintained by such Non-U.S. Shareholder in the U.S.; the Non-U.S. Shareholder is an individual who is present in the U.S. for 183 days or more in the taxable year of disposition and who has a "tax home" in the U.S.; or the Fund is or has been a U.S. real property holding corporation, as defined below, at any time within the five-year period preceding the date of disposition of the Shares or, if shorter, within the period during which the Non-U.S. Shareholder has held the Shares. Generally, a corporation is a U.S. real property holding corporation if the fair market value of its U.S. real property interests, as defined in the Code and applicable regulations, equals or exceeds 50% of the aggregate fair market value of its worldwide real property interests and its other assets used or held for use in a trade or business. The Fund is not likely to be or become a U.S. real property holding corporation as long as the Fund invests consistently with its investment strategy. Each potential Non-U.S. Shareholder is urged to consult his, her or its own tax advisor regarding the U.S. federal income tax consequences of the acquisition, holding, redemption, sale, exchange or other disposition of Fund Shares. Estate Tax Non-U.S. Shareholders of the Fund may be subject to U.S. estate tax with respect to their Fund Shares. FATCA Withholding Withholding of U.S. tax (at a 30% rate) is required with respect to payments of dividends made to certain non-U.S. entities that fail to comply (or be deemed compliant) with extensive reporting and withholding requirements designed to inform the U.S. Department of the Treasury of U.S.-owned foreign investment accounts. Shareholders may be requested to provide additional information to enable the applicable withholding agent to determine whether withholding is required. Backup Withholding Federal regulations generally require the Fund to withhold and remit "backup withholding" to the U.S. Treasury with respect to dividends and the proceeds of any redemption paid to you if you fail to furnish the Fund or the Fund s paying agent with a properly completed and executed IRS Form W-9, IRS Form W-8BEN, IRS Form W-8BEN-E or other applicable form. Furthermore, the IRS may notify the Fund to institute backup withholding if the IRS determines that your taxpayer identification number is incorrect or if you have failed to properly report taxable dividends or interest on a federal tax return. A taxpayer identification number is either the Social Security number or employer identification number of the record owner of the Shares. Any backup withholding does not constitute an additional tax imposed on the record owner of the Shares and may be claimed as a credit on the record owner s federal income tax return. The current backup withholding rate is 24%. Taxes on Purchase and Redemption of Creation Units An investor who exchanges bitcoin or carbon credit futures for Creation Shares generally will recognize a gain or a loss. The gain or loss will be equal to the difference between the market value of the Creation Shares at the time of the exchange and the exchanger s aggregate basis in the bitcoin or carbon credit futures surrendered and the amount of any cash consideration paid. A person who exchanges Creation Shares for bitcoin or carbon credit futures will generally recognize a gain or loss equal to the difference between the exchanger s basis in the Creation Shares and the aggregate value of the bitcoin and/or carbon credit futures and any cash received on such redemption. The IRS, however, may assert that a loss realized upon an exchange of securities for Creation Shares cannot be deducted currently under the rules governing "wash sales," or on the basis that there has been no significant change in economic position. Persons exchanging securities should consult their own tax advisor with respect to whether the wash sale rules apply and when a loss might be deductible. If you purchase or redeem Creation Shares, you will be sent a confirmation statement showing how many and at what price you purchased or sold Shares. The foregoing discussion summarizes certain consequences under current U.S. federal tax law of an investment in the Fund. It is not a substitute for personal tax advice. You may also be subject to state and local taxation on Fund distributions, and sales of Fund Shares. Consult your personal tax advisor about the potential tax consequences of an investment in Fund Shares under all applicable tax laws. Changes in applicable tax authority could materially affect the conclusions discussed above and could adversely affect the Fund. Purchases by Employee Benefit Plans The Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and/or Code section 4975 impose certain requirements on employee benefit plans and certain other plans and arrangements, including individual retirement accounts and annuities, Keogh plans, and certain collective investment funds or insurance company general or separate accounts in which such plans or arrangements are invested, that are subject to ERISA and/or the Code (collectively, "Plans"), and on persons who are fiduciaries with respect to the investment of assets treated as "plan assets" of a Plan. Government plans and some church plans are not subject to the fiduciary responsibility provisions of ERISA or the provisions of section 4975 of the Code, but may be subject to substantially similar rules under state or other federal law. In contemplating an investment of a portion of Plan assets in Shares, the Plan fiduciary responsible for making such investment should carefully consider, taking into account the facts and circumstances of the Plan, the "Risk Factors" discussed above and whether such investment is consistent with its fiduciary responsibilities, including, but not limited to (1) whether the fiduciary has the authority to make the investment under the appropriate governing plan instrument, (2) whether the investment would constitute a direct or indirect non-exempt prohibited transaction with a party in interest, (3) the Plan s funding objectives, and (4) whether under the general fiduciary standards of investment prudence and diversification such investment is appropriate for the Plan, taking into account the overall investment policy of the Plan, the composition of the Plan s investment portfolio and the Plan s need for sufficient liquidity to pay benefits when due. It is anticipated that the Shares will constitute "publicly-held offered securities" as defined in the Department of Labor Regulations 2510.3-101(b)(2). Accordingly, Shares purchased by a Plan, and not the Plan s interest in the underlying bitcoins held in the Trust represented by the Shares, should be treated as assets of the Plan, for purposes of applying the "fiduciary responsibility" and "prohibited transaction" rules of ERISA and the Code. Investment by Certain Retirement Plans Individual retirement accounts (IRA) and participant-directed accounts under tax-qualified retirement plans are limited in the types of investments they may make under the Code. Potential purchasers of Shares that are IRAs or participant-directed accounts under a Code section 401(a) plan should consult with their own tax advisors as to the consequences of a purchase of Shares. General Pool Disclosure Information you should know This prospectus contains information you should consider when making an investment decision about the Shares. You should rely only on the information contained in this prospectus or any applicable prospectus supplement. None of the Trust, the Fund or the Sponsor has authorized any person to provide you with different information and, if anyone provides you with different or inconsistent information, you should not rely on it. This prospectus is not an offer to sell the Shares in any jurisdiction where the offer or sale of the Shares is not permitted. The information contained in this prospectus was obtained from us and other sources believed by us to be reliable. You should disregard anything we said in an earlier document that is inconsistent with what is included in this prospectus or any applicable prospectus supplement. Where the context requires, when we refer to this "prospectus," we are referring to this prospectus and (if applicable) the relevant prospectus supplement. You should not assume that the information in this prospectus or any applicable prospectus supplement is current as of any date other than the date on the front page of this prospectus or the date on the front page of any applicable prospectus supplement. We include cross references in this prospectus to captions in these materials where you can find further related discussions. The table of contents tells you where to find these captions. where You can find more information The Trust, on behalf of the Fund, has filed a registration statement on Form S-1 with the SEC under the Securities Act. This Prospectus does not contain all of the information set forth in the registration statement (including the exhibits to the registration statement), parts of which have been omitted in accordance with the rules and regulations of the SEC. For further information about the Fund or the Shares, please refer to the registration statement, which you may inspect, without charge, online at www.sec.gov. Information about the Fund and the Shares can also be obtained from the Fund s website, which is 7rccetfs.com. The Fund s website address is only provided here as a convenience to you and the information contained on or connected to the website is not part of this prospectus or the registration statement of which this prospectus is part. The Fund is subject to the informational requirements of the Exchange Act and will file certain reports and other information with the SEC under the Exchange Act. The Sponsor will file an updated prospectus annually on behalf of the Fund pursuant to the requirements of the Securities Act. The reports and other information are available online at www.sec.gov. STATEMENTS, FILINGS AND REPORTS The Trust will furnish annual reports (as of the end of each fiscal year) for the Fund to DTC purchasers for distribution to Shareholders, as required to be provided to Shareholders by the CFTC and the NFA. These annual reports will contain financial statements prepared by the Sponsor and audited by an independent registered public accounting firm designated by the Sponsor. The Trust will also post monthly reports to the Fund s website (7rccetfs.com). These monthly reports will contain certain unaudited financial information regarding the Fund, including the Fund s NAV. The Sponsor will furnish to the Shareholders other reports or information which the Sponsor, in its discretion, determines to be necessary or appropriate. In addition, under SEC rules the Trust will be required to file quarterly and annual reports for the Fund with the SEC, which need not be sent to Shareholders but will be publicly available through the SEC. The Trust will post the same information that would otherwise be provided in the Trust s CFTC, NFA and SEC reports on the Fund s website: 7rccetfs.com. The accountants report on its audit of the Fund s financial statements will be furnished by the Trust to Shareholders upon request. The Trust will file such tax returns, and prepare, disseminate and file such tax reports for the Fund as it is advised by its counsel or accountants are from time to time required by any applicable statute, rule or regulation and will make such tax elections for the Fund as it deems advisable. The Fund or its appointed agent will provide tax information in accordance with the Code and applicable U.S. Treasury Regulations. Persons treated as intermediaries for purposes of these regulations may obtain tax information regarding the Fund by contacting the Fund at 234 West Florida Street, Suite 203, Milwaukee, Wisconsin 53204 or from the Fund s website, 7rccetfs.com. Fiscal Year The fiscal year of the Fund is the period ending December 31 of each year. The Sponsor may select an alternate fiscal year. SUMMARY OF PROMOTIONAL AND SALES MATERIAL The Fund expects to use the following sales material it has prepared: the Fund s website, 7rccetfs.com; and the Fund Fact Sheet found on the Fund s website. The materials described above are not a part of this prospectus or the registration statement of which this prospectus is a part. incorporation by reference of certain documents The Trust is a reporting company and files annual, quarterly and current reports and other information with the SEC. The rules of the SEC allow the Trust to "incorporate by reference" information that the Trust files with them, which means that the Trust can disclose important information to you by referring you to those documents. The information incorporated by reference is an important part of this prospectus. This prospectus incorporates by reference the documents set forth below that have been previously filed with the SEC and any future filings that the Trust makes with the SEC under Section 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934 (in each case other than those documents or portions of those documents not deemed to have been filed in accordance with SEC rules) between the date of this prospectus and the termination of the offering of the securities to be issued under the registration statement: Our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on April 1, 2024; Our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2024 filed with the SEC on May 15, 2024; Our Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2024 filed with the SEC on August 14, 2024; and Out Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2024 filed with the SEC on November 14, 2024. Any statement contained in a document incorporated by reference in this prospectus shall be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained in this prospectus or in any other subsequently filed document that also is or is deemed to be incorporated by reference in this prospectus modifies or supersedes such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus. We will provide to each person to whom a prospectus is delivered, including any beneficial owner, a copy of any document incorporated by reference in the prospectus (excluding any exhibits to those documents unless the exhibit is specifically incorporated by reference as an exhibit in that document) at no cost, upon written or oral request at the following address or telephone number: 7RCC Spot Bitcoin and Carbon Credit Futures ETF Attention: Tidal Investments LLC 234 West Florida Street, Suite 203 Milwaukee, WI 53204 (844)-986-7700 The Fund s internet website is 7rccetfs.com. The Trust makes its electronic filings with the SEC, including its annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to these reports available on the Fund s website free of charge as soon as practicable after we file or furnish them with the SEC. The information contained on the Fund s website is not incorporated by reference in this prospectus and should not be considered a part of this prospectus. financial statements The financial statements of the Trust have been incorporated into this prospectus and registration statement as described above under "Incorporation By Reference of Certain Information." The financial statements of the Fund are set forth below. 7RCC Spot Bitcoin and Carbon Credit Futures ETF Index to Financial Statements Page Number Report of Independent Registered Public Accounting Firm 121 Statement of Assets and Liabilities 121 Notes to Statement of Assets and Liabilities 121 Report of Independent Registered Public Accounting Firm [to be provided by pre-effective amendment] 7RCC Spot Bitcoin and Carbon Credit Futures ETF Statement of Assets and Liabilities [to be provided by pre-effective amendment] Notes to Statement of Assets and Liabilities [______, ____] [to be provided by pre-effective amendment] TABLE OF CONTENTS Page GLOSSARY OF DEFINED TERMS i PART ONE – Disclosure document 1 STATEMENT REGARDING FORWARD-LOOKING STATEMENTS 1 INDUSTRY AND MARKET DATA 1 PROSPECTUS SUMMARY 2 THE OFFERING 10 RISK FACTORS 14 Investment objective and investment strategy 50 OVERVIEW OF THE BITCOIN INDUSTRY AND MARKET 59 OVERVIEW OF COMMODITY Futures MARKETS and carbon markets 67 Description of the index 69 Performance of the other commodity pools operated by the cpo 70 Management s discussion and analysis of financial condition and results of operations 77 Charges 78 USE OF PROCEEDS 79 Who may subscribe 80 DESCRIPTION OF CREATION AND REDEMPTION OF SHARES 80 ADDITIONAL INFORMATION ABOUT THE TRUST 84 plan of distribution 89 Additional Information Regarding the Shares 90 CUSTODY OF THE Fund s ASSETS 91 THE FUND S SERVICE PROVIDERS 95 AUTHORIZED Purchasers 105 CALCULATION OF NAV 105 conflicts of interest 108 privacy policy 109 EXPENSES 110 PROVISIONS OF LAW 111 MANAGEMENT; VOTING BY SHAREHOLDERS 111 MEETINGS 111 BOOKS AND RECORDS 112 GOVERNING LAW; CONSENT TO DELAWARE JURISDICTION 112 legal matters 112 Experts 112 Material U.S. FEDERAL INCOME TAX CONSEQUENCES 112 Purchases by employee benefit plans 117 Part two – General Pool Disclosure 119 information you should know 119 where You can find more information 119 STATEMENTS, FILINGS AND REPORTS 119 Fiscal Year 119 SUMMARY OF PROMOTIONAL AND SALES MATERIAL 120 incorporation by reference of certain documents 120 financial statements 120 statement of additional information Statement of additional information 7RCC Spot Bitcoin and Carbon Credit Futures ETF This statement of additional information is the second part of a two-part document. The first part is the Fund s disclosure document. The disclosure document and this statement of additional information are bound together, and both parts contain important information. This statement of additional information should be read in conjunction with the disclosure document. To obtain a copy of the disclosure document without charge, call the Fund at (844)-986-7700. Before you decide whether to invest, you should read the entire prospectus carefully and consider the risk factors beginning on page [ ]. This statement of additional information and accompanying disclosure document are both dated [ ], 2025. PART II—INFORMATION NOT REQUIRED IN PROSPECTUS TABLE OF CONTENTS Item 13.Other Expenses of Issuance and Distribution. The Trust shall not bear any expenses incurred in connection with the issuance and distribution of the securities being registered. These expenses shall be paid by Tidal Investments LLC, the sponsor of the Trust. Except for the Securities and Exchange Commission Registration Fee and Exchange Listing Fee, all such expenses are estimated: SEC registration fee (actual) $[ ]* Listing fee (actual) $[ ]* Auditor s fees and expenses $[ ]* Legal fees and expenses $[ ]* Printing expenses $[ ]* Miscellaneous expenses $[ ]* Total $[ ]* * to be provided by amendment Item 14.Indemnification of Directors and Officers. The Trust s First Amended and Restated Declaration of Trust and Trust Agreement (the "Trust Agreement") provides that the Sponsor shall be indemnified by the Trust(or, by a series of the Trust separately to the extent the matter in question relates to a single series or disproportionately affects a series in relation to other series) against any losses, judgments, liabilities, expenses and amounts paid in settlement of any claims sustained by it in connection with its activities for the Trust, provided that (i) the Sponsor was acting on behalf of or performing services for the Trust and has determined, in good faith, that such course of conduct was in the best interests of the Trust and such liability or loss was not the result of gross negligence, willful misconduct, or a breach of the Trust Agreement on the part of the Sponsor and (ii) any such indemnification will only be recoverable from the applicable trust estate or trust estates. All rights to indemnification permitted by the Trust Agreement and payment of associated expenses shall not be affected by the dissolution or other cessation to exist of the Sponsor, or the withdrawal, adjudication of bankruptcy or insolvency of the Sponsor, or the filing of a voluntary or involuntary petition in bankruptcy under Title 11 of the Bankruptcy Code by or against the Sponsor. Notwithstanding the foregoing, the Sponsor shall not be indemnified for any losses, liabilities or expenses arising from or out of an alleged violation of U.S. federal or state securities laws unless (i) there has been a successful adjudication on the merits of each count involving alleged securities law violations as to the particular indemnitee and the court approves the indemnification of such expenses (including, without limitation, litigation costs), (ii) such claims have been dismissed with prejudice on the merits by a court of competent jurisdiction as to the particular indemnitee and the court approves the indemnification of such expenses (including, without limitation, litigation costs) or (iii) a court of competent jurisdiction approves a settlement of the claims against a particular indemnitee and finds that indemnification of the settlement and related costs should be made. The Trust and its series shall not incur the cost of that portion of any insurance which insures any party against any liability, the indemnification of which is prohibited by the Trust Agreement. Expenses incurred in defending a threatened or pending civil, administrative or criminal action, suit or proceeding against the Sponsor shall be paid by the Trust or the applicable series of the Trust in advance of the final disposition of such action, suit or proceeding, if (i) the legal action relates to the performance of duties or services by the Sponsor on behalf of the Trust or a series of the Trust; (ii) the legal action is initiated by a party other than the Trust; and (iii) the Sponsor undertakes to repay the advanced funds with interest to the Trust or the applicable series of the Trust in cases in which it is not entitled to indemnification under the Trust Agreement. For purposes of the indemnification provisions of the Trust Agreement, the term "Sponsor" includes, in addition to the Sponsor, any other covered person performing services on behalf of the Trust and acting within the scope of the Sponsor s authority as set forth in the Trust Agreement. II-1 In the event the Trust or a series of the Trust is made a party to any claim, dispute, demand or litigation or otherwise incurs any loss, liability, damage, cost or expense as a result of or in connection with any Shareholder s (or assignee s) obligations or liabilities unrelated to Trust business, such Shareholder (or assignees cumulatively) shall indemnify, defend, hold harmless, and reimburse the Trust or the applicable series of the Trust for all such loss, liability, damage, cost and expense incurred, including attorneys and accountants fees. The payment of any amount pursuant to the Trust Agreement shall take into account the allocation of liabilities and other amounts, as appropriate, among the series of the Trust. Item 15.Recent Sales of Unregistered Securities. None. Item 16.Exhibits and Financial Statement Schedules. (a) Exhibits Exhibit Number Description 3.1 First Amended and Restated Declaration of Trust and Trust Agreement(1) 5.1 Opinion of Chapman and Cutler LLP relating to the legality of the Shares* 8.1 Opinion of Chapman and Cutler LLP with respect to federal income tax consequences* 10.1 Form of Authorized Purchaser Agreement (included as Exhibit B to the First Amended and Restated Declaration of Trust and Trust Agreement)(1) 10.2 Form of Distribution Services Agreement* 10.3 Form of Custody Agreement* 10.4 Form of Bitcoin Custody Agreement by and between the Trust, on behalf of the Fund, and Gemini Trust Company, LLC* 10.6 Form of Fund Accounting Servicing Agreement* 10.7 Form of Transfer Agent Servicing Agreement* 10.8 Form of Fund Administration Servicing Agreement* 10.9 Index License Agreement* 10.10 Support Agreement* 23.1 Consent of Tait, Weller, & Baker, LLP, Independent Registered Public Accounting Firm(3) 23.2 Consent of Chapman and Cutler LLP is included in Exhibit 5.1* 24.1 Power of Attorney (included on signature page to this Registration Statement as filed herein)(3) 107 Filing Fee Table(2) (1) Previously filed as an exhibit to the Registrant s Registration Statement on Form S-1 (333-273364), filed on July 21, 2023 and incorporated by reference herein. (2) Previously filed as an exhibit to the Registrant s Registration Statement on Form S-1 (333-273364), filed on December 22, 2023 and incorporated by reference herein. (3) Filed herewith. * To be filed by amendment. Item 17. Undertakings. The undersigned Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. Provided, however, that: (1)(i), (ii), and (iii) of this section do not apply if the registration statement is on Form S-1, Form S-3, Form SF-3 or Form F-3 and the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or, as to a registration statement on Form S-3, Form SF-3 or Form F-3, is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold
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+PROSPECTUS SUMMARY This summary highlights certain information contained elsewhere in this Prospectus. This summary does not contain all of the information that may be important to you. You should read and carefully consider the following summary together with the entire Prospectus, including the sections of this Prospectus entitled "Risk Factors" and "Operating and Financial Review and Prospects" and our consolidated financial statements and the related notes included elsewhere in this Prospectus, before deciding to invest in our securities. Overview of the Company DEFSEC Technologies Inc., formerly known as KWESST Micro Systems Inc. is an early-stage technology company that develops and commercializes next-generation tactical systems for military and security forces and public safety markets. Our product development has focused on three niche market segments as follows: The following is a summary of our main product and service categories for each business line: Less-Lethal Digitization Counter-Threat PARA OPSTM products: Non-reciprocating devices: A single-shot device A five-shot device 12-gauge shotgun (planning stage; not yet industrialized) Reciprocating devices Replica pistol AR style rifle Cartridge Blunt / training Inert marking powder Irritant powder ARWEN products: Single shot 37mm launcher Multi-round 37mm launcher Baton blunt impact Products: TASCS Indirect Fire Modules System ("TASCS IFM") TASCS Networked Observation and Reconnaissance System ("TASCS NORS") New T-SAS Tactical Surveillance and Sniper system ("T-SAS ") Services: ATAK Centre of Excellence Lightning SaaS for Critical Incident Management System ("CIMS") (not yet commercially available) Task-order based software services on long-term government defence contracts Products: Battlefield Laser Detection Systems ("BLDS") Phantom Electronic Warfare device KWESST MICRO SYSTEMS INC. Unaudited Condensed Consolidated Interim Statements of Financial Position At March 31, 2025 and September 30, 2024 In Canadian dollars Notes March 31, 2025 September 30, 2024 ASSETS Cash and cash equivalents $ 4,408,844 $ 256,828 Restricted short-term investment 30,000 30,000 Trade and other receivables 4 1,081,864 567,875 Inventories 5 581,197 533,163 Prepaid expenses and deposits 333,125 179,051 Deferred costs 16,354 275,438 Current assets 6,451,384 1,842,355 Property and equipment 248,738 311,712 Right-of-use assets 62,923 230,124 Deposit 30,276 28,806 Intangible assets 6 2,725,138 3,174,832 Deferred costs 69,030 29,319 Non-current assets 3,136,105 3,774,793 Total Assets $ 9,587,489 $ 5,617,148 LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities Accounts payable and accrued liabilities 7 and 8 $ 1,122,180 $ 1,660,637 Accrued royalties liability - 200,000 Lease obligations 140,972 147,078 Contract liabilities 9 122,612 120,571 Warrant liabilities 10 and 11(b) 177,327 847,295 Current liabilities 1,563,091 2,975,581 Accrued royalties liability 1,202,961 1,118,135 Lease obligations 38,492 155,145 Non-current liabilities 1,241,453 1,273,280 Total Liabilities 2,804,544 4,248,861 Shareholders' Equity Share capital 11(a) 43,197,908 37,822,725 Warrants 11(b) 5,926,182 1,084,687 Contributed surplus 11(c) 5,362,150 5,152,753 Accumulated other comprehensive loss (133,415 ) (38,520 ) Accumulated deficit (47,569,880 ) (42,653,358 ) Total Shareholders' Equity 6,782,945 1,368,287 Total Liabilities and Shareholders' Equity $ 9,587,489 $ 5,617,148 See Note 2(a) Going concern and Note 17 Commitments and contingencies. See accompanying notes to the unaudited condensed consolidated interim financial statements. The information contained in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED JULY 22, 2025 Up to 879,487 Common Shares Up to 879,487 Warrants to Purchase Common Shares Up to 879,487 Pre-funded Warrants to Purchase Common Shares Up to 65,961 Placement Agent Warrants to Purchase Common Shares Up to 1,824,935 Common Shares Underlying the Warrants, Pre-Funded Warrants and Placement Agent Warrants DEFSEC Technologies Inc. We are offering (the Offering ) up to 879,487 common shares, no par value per share (each, a Common Share ) together with common share purchase warrants (each, a Warrant ) to purchase up to 879,487 Common Shares. The Common Shares and Warrants are immediately separable and will be issued separately in this Offering but must be purchased together in this Offering. Each Common Share, or a Pre-funded Warrant (as defined below) in lieu thereof, is being sold together with a Warrant to purchase one Common Share. The assumed public offering price for each Common Share and accompanying Warrant is CAD$11.70. Each Warrant will have an exercise price per share of $ , will be exercisable upon issuance and have a term of five years from the date of issuance. We are also offering to those purchasers, if any, whose purchase of Common Shares in this Offering would otherwise result in the purchaser, together with its affiliates and certain related parties, beneficially owning more than 4.99% (or, at the election of the purchaser, 9.99%) of our outstanding Common Shares immediately following the consummation of this Offering, the opportunity to purchase, if the purchaser so chooses, pre-funded warrants to purchase Common Shares at an exercise price of CAD$0.001 per share (each a "Pre-funded Warrant"). The purchase price of each Pre-funded Warrant is equal to the price per Common Share being sold to the public in this Offering, minus CAD$0.001. The Pre-funded Warrants will be immediately exercisable and may be exercised at any time. For each Pre-funded Warrant we sell, the number of Common Shares we are offering will be decreased on a one-for-one basis. The Warrants and the Pre-funded Warrants will not be listed on the Nasdaq Capital Market (the "Nasdaq") and are not expected to trade in any market; however, we anticipate that the Common Shares to be issued upon exercise of the Warrants and Pre-funded Warrants will trade on the Nasdaq. This Offering also includes the Common Shares issuable from time to time upon exercise of the Warrants, Pre-funded Warrants and Placement Agent Warrants. This Offering will terminate on August 31, 2025, unless we decide to terminate the Offering (which we may do at any time in our discretion) prior to that date. We will have one closing for all the securities purchased in this Offering. The combined public offering price per Common Share (or Pre-funded warrant) and Warrant will be fixed for the duration of this Offering. We have engaged H.C. Wainwright & Co., LLC (the placement agent ) to act as our exclusive placement agent in connection with this Offering. The placement agent has agreed to use its reasonable best efforts to arrange for the sale of the securities offered by this Prospectus. The placement agent is not purchasing or selling any of the securities we are offering and the placement agent is not required to arrange the purchase or sale of any specific number or dollar amount of securities. We have agreed to pay placement agent fees to the placement agent as set forth in the table below, which assumes that we sell all of the securities offered by this Prospectus. Since we will deliver the securities to be issued in this Offering upon our receipt of investor funds, there is no arrangement for funds to be received in escrow, trust or similar arrangement. There is no minimum offering requirement as a condition of closing of this Offering. Because there is no minimum offering amount required as a condition to closing this Offering, we may sell fewer than all of the securities offered hereby, which may significantly reduce the amount of proceeds received by us, and investors in this Offering will not receive a refund in the event that we do not sell an amount of securities sufficient to pursue our business goals described in this Prospectus. In addition, because there is no escrow account and no minimum offering amount, investors could be in a position where they have invested in our company, but we are unable to fulfill all of our contemplated objectives due to a lack of interest in this Offering. Further, any proceeds from the sale of securities offered by us will be available for our immediate use, despite uncertainty about whether we would be able to use such funds to effectively implement our business plan. See the section entitled Risk Factors for more information. We will bear all costs associated with the offering. See Plan of Distribution on page 111 of this Prospectus for more information regarding these arrangements. Our Common Shares are listed for trading on the Nasdaq under the stock symbol DFSC , listed for trading on the TSX Venture Exchange (the TSXV ) under the stock symbol DFSC.V , and listed on the Frankfurt Stock Exchange under the stock symbol of 62U2 . Certain of our outstanding warrants are listed for trading on Nasdaq under the trading symbol DFSCW and on the TSXV under the trading symbol DFSC.WT.U . We do not intend to apply for the listing of the Pre-funded Warrants on any national securities exchange or other trading market. Without an active trading market, the liquidity of the Pre-funded Warrants will be limited. On April 23, 2025, on the Nasdaq and on April 24, 2025, on the TSXV, we effected a twenty-one for one (21-for-1) reverse stock split of our Common Shares (the "Reverse Split"). Accordingly, all shareholders of record at the opening of business on April 23, 2025, received one issued and outstanding post-Reverse Split Common Share of the Company in exchange for 21 outstanding pre-Reverse Split Common Shares of the Company. No fractional shares were issued in connection with the Reverse Split. All fractional shares created by the Reverse Split were rounded to the nearest whole number of Common Shares, with any fractional interest representing 0.5 or more Common Shares entitling holders thereof to receive one whole Common Share. At the opening of business on April 23, 2025, we had 530,365 outstanding Common Shares. Effective on the date of the Reverse Split, our outstanding securities that are convertible or exercisable into Common Shares were proportionately adjusted to reflect the Reverse Split in accordance with each security's terms with the exception of warrants. On July 18, 2025, the closing price for our Common Shares on Nasdaq was USD$8.21 (CAD$11.26). We have assumed a public offering price of CAD$11.70 per Common Share, which is the closing price for our Common Shares on the TSXV on July 18, 2025. The actual public offering price per Common Share will be determined on the pricing date based on the closing price of our Common Shares on TSXV on that day and may reflect a discount of up to 15% (the maximum allowable discount under TSXV rules), with the final offering price determined through negotiations between us and the placement agent at the time of pricing. We are an emerging growth company and a foreign private issuer as defined under United States federal securities laws and elect to comply with reduced public company reporting requirements. Please read Implications of Being an Emerging Growth Company and Foreign Private Issuer Status beginning on page 6 of this Prospectus for more information. Investing in our securities involves a high degree of risk, including the risk of losing your entire investment. See Risk Factors beginning on page 11 to read about factors you should consider before buying our securities. Neither the United States Securities and Exchange Commission nor any state securities commission nor any other regulatory body has approved or disapproved of these securities or determined if this Prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Common Share and Warrant Per Pre-funded Warrant and Warrant Total Public offering price Placement agent commissions(1) Proceeds to us, before expenses (1) We have agreed to pay the placement agent a cash fee equal to 7.5% of the gross proceeds raised in this Offering. We have also agreed to pay the placement agent a management fee equal to 1.0% of the gross proceeds raised in this Offering and to reimburse the placement agent for its non-accountable expenses in an amount of $5,000, legal fees and other out-of-pocket expenses in the amount of up to $100,000, and clearing expenses in the amount of $5,000. In addition, we have agreed to issue to the placement agent or its designees warrants to purchase a number of Common Shares equal to 7.5% of the Common Shares sold in this Offering (including the Common Shares issuable upon exercise of the pre-funded warrants), at an exercise price of $ per share, which represents 125% of the assumed public offering price per share (the Placement Agent Warrants ). We refer you to Plan of Distribution for additional information regarding placement agent compensation. The delivery to purchasers of the securities in this Offering is expected to be made on or about , 2025, subject to satisfaction of certain customary closing conditions. H.C. Wainwright & Co. The date of this Prospectus is , 2025 Our core mission is to protect and save lives. We group our offerings for commercialization purposes into Military and Public Safety missions. DEFSEC's Military offerings are comprised of: Digitization: real-time data sharing at the tactical level, including integration with Battlefield Management Applications (BMS) including ATAK and TAK; Digitized firing platforms ("Digital Fires" or "Joint Fires"); BLDS; and Digitized Electro Magnetic Spectrum Operations ("EMSO"). DEFSEC's Public Safety offerings are comprised of: KWESST LightningTM: leverages the Company s military digitization technology to provide responders to any type of incident with instant onboarding to the mission and TAK-enabled real-time situational awareness software as a service ( SaaS ). The Company is currently pursuing in trials and pilots of the product as it continues development towards the commercial release that is currently expected to be available in the 2025 calendar year. Less-Lethal Munitions Systems: PARA OPSTM, a next-generation less-lethal system. ARWEN 37mm system, plus a new 40mm munition. Strategy Our strategy is to pursue and win large defense contracts for multi-year revenue visibility with prime defense contractors for next-generation situational awareness, with a particular focus on ATAK applications that can be leveraged to address similar requirements in the Public Safety Market complemented by our proprietary ARWEN and PARA OPSTM less-lethal products, where it is possible to drive sales and where the sales cycle is typically shorter than the more programmatic defense market. Risk Factors Our business is subject to a number of risks which you should be aware of before making an investment decision. You should carefully consider all of the information set forth in this Prospectus and, in particular, should evaluate the specific factors set forth under "Risk Factors" in deciding whether to invest in our securities. These risks include but are not limited to the following: You will experience immediate and substantial dilution as a result of this Offering and may experience additional dilution in the future. The liquidity of our Common Shares may be decreased as a result of the Reverse Split. Management will have broad discretion as to the use of the proceeds from this Offering, and we may not use the proceeds effectively. The market price of our Common Shares may be adversely impacted by the release of certain of our securities that are currently escrowed if the holders immediately trade these securities upon release. We have limited operating experience as a publicly traded company in the United States. We incur significantly increased costs and devote substantial management time as a result of operating as a United States public company. Global inflationary pressure may result in lower gross margins on our future product sales if we are unable to pass on the related increase in cost to our customers through an increase in the price of our products. We may incur higher costs or unavailability of components, materials and accessories. KWESST MICRO SYSTEMS INC. Unaudited Condensed Consolidated Interim Statements of Net Loss and Comprehensive Loss Three and six months ended March 31, 2025 and 2024 In Canadian dollars Notes Three Months Ended March 31, 2025 Three Months Ended March 31, 2024 Six Months Ended March 31, 2025 Six Months Ended March 31, 2024 (Reclassification Note 2(g)) (Reclassification Note 2(g)) Revenue 13 $ 1,264,162 $ 485,864 $ 2,151,820 $ 614,932 Cost of sales (950,141 ) (243,681 ) (1,433,277 ) (426,554 ) Gross margin 314,021 242,183 718,543 188,378 Operating expenses General and administrative 1,102,261 1,682,698 2,613,705 2,684,994 Selling and marketing 334,114 418,027 1,016,661 900,968 Research and development 299,916 705,640 972,491 1,289,928 Share-based compensation 26,342 60,982 77,397 124,471 Depreciation and amortization 285,929 319,654 600,420 641,075 Total operating expenses 2,048,562 3,187,001 5,280,674 5,641,436 Operating loss (1,734,541 ) (2,944,818 ) (4,562,131 ) (5,453,058 ) Other income (expenses) Share issuance costs 11(a) - - (1,807,686 ) - Net finance costs 14 (31,361 ) (61,658 ) (93,420 ) (74,855 ) Foreign exchange gain (loss) 77,823 (805 ) 191,106 90,905 Impairment of right-of-use assets 6,809 - (81,787 ) - Change in fair value of warrant liabilities 10 221,763 (532,922 ) 1,437,396 1,497,832 Total other income (expenses), net 275,034 (595,385 ) (354,391 ) 1,513,882 Net loss $ (1,459,507 ) $ (3,540,203 ) $ (4,916,522 ) $ (3,939,176 ) Other comprehensive income (loss): Items that are or may be reclassified subsequently to profit or loss: Foreign currency translation differences 1,381 (34,497 ) (94,895 ) (3,203 ) Total comprehensive loss $ (1,458,126 ) $ (3,574,700 ) $ (5,011,417 ) $ (3,942,379 ) Net loss per share Basic and diluted 1(b)(c) and 12 $ (6.16 ) $ (127.66 ) $ (16.11 ) $ (144.63 ) Weighted average number of shares outstanding Basic and diluted 1(b)(c) and 12 237,039 27,732 305,190 27,236 See accompanying notes to the unaudited condensed consolidated interim financial statements. Our inability to comply with Nasdaq's continued listing requirements could result in our Common Shares being delisted, which could affect the market price and liquidity of our securities and reduce our ability to raise capital. We are an "emerging growth company," and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies will make our securities less attractive to investors. There can be no certainty that we will ever achieve or sustain profitability or positive cash flow from our operating activities. Our ability to generate substantial revenue growth, or to sustain any revenue growth that is achieved. Reliance on third-party suppliers may create risks related to our potential inability to obtain an adequate supply of components or materials and reduced control over pricing and timing of delivery of components and materials. Potential cancellation or loss of customer contracts if we are unable to meet contract performance requirements. We will be reliant on information technology systems and may be subject to damaging cyber-attacks. Protecting and defending against intellectual property claims may have a material adverse effect on our business. Our business is subject to certain risks inherent in international business, including regional conflicts that may impact our operations and may be beyond our control. Our directors, officers or members of management may have conflicts of interest and it may not be possible for foreign investors to enforce actions against us, and our directors and officers. Our insurance policies may be inadequate to fully protect us from material judgments and expenses. Our Common Shares may experience extreme stock price volatility unrelated to our actual or expected operating performance, financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our Common Shares. We are subject to extensive government regulation in the United States for our products and may not be able to comply with changes in government policies and legislation. Rapidly changing technology and evolving industry standards could result in product obsolescence or short product life cycles. If we are unable to satisfy the requirements of Sarbanes-Oxley Act of 2002, as amended ("Sarbanes-Oxley") or our internal controls over financial reporting are not effective, the reliability of our financial statements may be questioned. We may lose foreign private issuer status in the future, which could result in additional costs and expenses. Implications of Being an Emerging Growth Company As a company with less than USD$1.235 billion in revenue for our last fiscal year, we qualify as an "emerging growth company" pursuant to the Jumpstart Our Business Startups Act of 2012, as amended (the "JOBS Act"). An emerging growth company may take advantage of specified reduced reporting and other requirements compared to those that are otherwise applicable generally to public companies. These provisions include: reduced executive compensation disclosure; exemptions from the requirement to hold a non-binding advisory vote on executive compensation, including golden parachute compensation; and an exemption from the auditor attestation requirement under Section 404 of Sarbanes-Oxley ("Section 404") in the assessment of the emerging growth company's internal control over financial reporting. KWESST MICRO SYSTEMS INC. Unaudited Condensed Consolidated Interim Statements of Changes in Shareholders' Equity Six months ended March 31, 2025 and 2024 In Canadian dollars Notes Number of Shares(1) Share capital Warrants Contributed surplus Translation reserve Deficit Total Shareholders' Equity Balance, September 30, 2023 26,969 $ 33,379,110 $ 1,042,657 $ 4,769,115 $ (39,663 ) $ (35,215,599 ) $ 3,935,620 Warrants exercised 11(b) 1,837 594,667 - - - - 594,667 Warrants expired 11(b) - (1,012 ) 1,012 - - - Share-based compensation 11(c) - - 124,471 - - 124,471 Other comprehensive loss - - - (3,203 ) - (3,203 ) Net loss - - - - (3,939,176 ) (3,939,176 ) Balance, March 31, 2024 28,806 $ 33,973,777 $ 1,041,645 $ 4,894,598 $ (42,866 ) $ (39,154,775 ) $ 712,379 Balance, September 30, 2024 75,199 $ 37,822,725 $ 1,084,687 $ 5,152,753 $ (38,520 ) $ (42,653,358 ) $ 1,368,287 Shares issued for public offering 11(a) 3,810 100,310 - - - - 100,310 Shares issued for private placement 11(a) 50,248 371,154 - - - - 371,154 Warrants issued for private placement 11(a) - - 2,394,955 - - - 2,394,955 Pre-funded warrants issued for public offering 11(a) - - 3,489,393 - - - 3,489,393 Pre-funded warrants issued for private placement 11(a) - - 4,579,154 - - - 4,579,154 Share offering costs 11(a) - (164,199 ) (1,671,762 ) - - - (1,835,961 ) Shares issued for debt 11(a) 5,669 100,000 - - - - 100,000 Pre-funded warrants exercised 11(b) 378,771 4,339,668 (3,550,495 ) - - - 789,173 Warrants exercised 11(b) 16,667 628,250 (267,750 ) - - - 360,500 Warrants expired 11(b) - - (132,000 ) 132,000 - - - Share-based compensation 11(c) - - - 77,397 - - 77,397 Other comprehensive loss - - - - (94,895 ) - (94,895 ) Net loss - - - - - (4,916,522 ) (4,916,522 ) Balance, March 31, 2025 530,364 $ 43,197,908 $ 5,926,182 $ 5,362,150 $ (133,415 ) $ (47,569,880 ) $ 6,782,945 DEFSEC TECHNOLOGIES INC. (Formerly KWESST MICRO SYSTEMS INC.) Table of contents for the years ended September 30, 2024, 2023, and 2022 Page Independent Auditor's Report 1 FINANCIAL STATEMENTS Consolidated Statements of Financial Position 2 Consolidated Statements of Net Loss and Comprehensive Loss 3 Consolidated Statements of Changes in Shareholders' Equity (Deficit) 4 Consolidated Statements of Cash Flows We will remain an emerging growth company until the earliest of (a) the last day of the fiscal year during which we have total annual gross revenues of at least USD$1.235 billion; (b) the last day of our fiscal year following the fifth anniversary of the completion of this Offering; (c) the date on which we have, during the preceding three-year period, issued more than USD$1.0 billion in non-convertible debt; or (d) the date on which we are deemed to be a "large accelerated filer" under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), which would occur if the market value of our Common Shares that are held by non-affiliates exceeds USD$700 million. Once we cease to be an emerging growth company, we will not be entitled to the exemptions provided in the JOBS Act discussed above. Foreign Private Issuer Status We are a foreign private issuer within the meaning of the rules under the Exchange Act. As such, we are exempt from certain provisions applicable to United States domestic public companies. For example: we are not required to provide as many Exchange Act reports, or as frequently, as a domestic public company; for interim reporting, we are permitted to comply solely with our home country requirements, which may be less rigorous than the rules that apply to domestic public companies; we are not required to provide the same level of disclosure on certain issues, such as executive compensation; we are exempt from provisions of Regulation FD aimed at preventing issuers from making selective disclosures of material information; we are not required to comply with the sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations in respect of a security registered under the Exchange Act; and we are not required to comply with Section 16 of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and establishing insider liability for profits realized from any "short-swing" trading transaction. Corporate Information We are a corporation domiciled in Canada and were incorporated under the Business Corporations Act (British Columbia) (the BCBCA ) on November 28, 2017. Our registered and head office is located at 2900 - 550 Burrard Street, Vancouver, British Columbia V6C 0A3 and our principal place of business is located at 80 Hines, Suite #300, Ottawa, Ontario, Canada, K2K 2T8. Our internet site is https://www.kwesst.com; our telephone number is (613) 241-1849. The information contained on our website is not incorporated by reference into this Prospectus, and you should not consider any information contained on, or that can be accessed through, our website as part of this Prospectus in deciding whether to purchase Common Shares or Pre-funded Warrants. KWESST MICRO SYSTEMS INC. Table of contents for the three and six months ended March 31, 2025 and 2024 Page FINANCIAL STATEMENTS Unaudited Condensed Consolidated Interim Statements of Financial Position 3 Unaudited Condensed Consolidated Interim Statements of Net Loss and Comprehensive Loss 4 Unaudited Condensed Consolidated Interim Statements of Changes in Shareholders' Equity 5 Unaudited Condensed Consolidated Interim Statements of Cash Flows KWESST MICRO SYSTEMS INC. Unaudited Condensed Consolidated Interim Statements of Cash Flows Six months ended March 31, 2025 and 2024 In Canadian dollars Notes Six months ended March 31, 2025 Six months ended March 31, 2024 OPERATING ACTIVITIES Net loss $ (4,916,522 ) $ (3,939,176 ) Items not affecting cash: Depreciation and amortization 600,420 641,075 Share-based compensation 11(c) 77,397 124,471 Change in fair value of warrant liabilities (including related foreign exchange gain) 10 (1,359,187 ) (1,539,317 ) Net finance costs 14 93,420 74,855 Changes in non-cash working capital items 16 (1,188,324 ) (368,103 ) Impairment of ROU asset 82,954 - Payments of share issuance costs 1,807,686 - Gain on debt settlement (500 ) - Changes in non-current deferred costs (39,711 ) - Interest received (paid) (9,564 ) 27,086 Cash flows used in operating activities (4,851,931 ) (4,979,109 ) INVESTING ACTIVITIES Additions of property and equipment (32,035 ) (64,370 ) Investments in intangible assets 6 (26,675 ) (5,037 ) Cash flows used in investing activities (58,710 ) (69,407 ) FINANCING ACTIVITIES Proceeds from U.S. Public Offering-November 2024 11(a) 4,871,033 (74,437 ) Proceeds from Private Placement-November 2024 11(a) 3,421,635 - Proceeds from Private Placement-February 2025 11(a) 3,655,758 - Repayments of lease obligations (67,554 ) (74,437 ) Payments of share issuance costs 11(a) (3,188,310 ) - Payments of deferred financing fees - (20,844 ) Proceeds from exercise of warrants 370,095 522 Cash flows provided by financing activities 9,062,657 (94,759 ) Net change in cash and cash equivalents during the period 4,152,016 (5,143,275 ) Cash and cash equivalents, beginning of period 256,828 5,407,009 Cash and cash equivalents, end of period $ 4,408,844 $ 263,734 Cash and cash equivalents consist of the following: Cash held in banks $ 4,378,844 $ 263,734 Short-term guaranteed investment certificates 30,000 - Cash and cash equivalents $ 4,408,844 $ 263,734 See Note 16 Supplemental cash flow information. See accompanying notes to the unaudited condensed consolidated interim financial statements.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/DKI_darkiris_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/DKI_darkiris_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..954396835a52e9a9f137622ce0b2b5902a4bbe42
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/DKI_darkiris_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1 THE OFFERING 10 SUMMARY FINANCIAL INFORMATION 11 RISK FACTORS 12 SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS 40 USE OF PROCEEDS 41 DIVIDEND POLICY 42 CAPITALIZATION 42 DILUTION 43 SELECTED CONSOLIDATED FINANCIAL AND OPERATING DATA 44 MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 45 OUR CORPORATE STRUCTURE AND HISTORY 58 BUSINESS 59 MANAGEMENT 85 PRINCIPAL SHAREHOLDERS 92 RELATED PARTY TRANSACTIONS 94 DESCRIPTION OF SHARE CAPITAL AND GOVERNING DOCUMENTS 95 SHARES ELIGIBLE FOR FUTURE SALE 104 TAXATION 105 UNDERWRITING 110
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/DMIIU_drugs_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/DMIIU_drugs_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..43d62dfdefd561662da4c8cee2a483f292dbc61b
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/DMIIU_drugs_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary Dilution and Dilution for more information. As of June 30, 2025 Offering Price of $10.00 per Unit 25% of Maximum Redemption 50% of Maximum Redemption 75% of Maximum Redemption Maximum Redemption NTBV NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price Assuming Full Exercise of Over-Allotment Option $ 7.59 7.00 3.00 6.02 3.98 4.11 5.89 (1.32) 11.32 Assuming No Exercise of Over-Allotment Option $ 7.58 6.99 3.01 6.02 3.98 4.12 5.88 (1.24) 11.24 Our sponsor and members of our management team will directly or indirectly own our securities following this offering, and accordingly, they may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Additionally, each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities, which also may impact their decisions because of their direct and/or indirect ownership of founder shares and private units, all of which interests may pose material conflicts with the interests of the purchasers of public units. In particular, all our directors and officers currently also serve as directors and officers of Drugs Made In America Acquisition Corp. ( DMAA ), a special purpose acquisition company that is in search of business combination targets. See Proposed Business Our Acquisition Process and Management Conflicts of Interest for additional information. Additionally, we will reimburse our sponsor in an amount equal to $10,000 per month for office space, utilities and secretarial and administrative support made available to us, as described elsewhere in this prospectus. Upon consummation of this offering, we will repay up to $325,000 in loans made to us by our sponsor to cover offering-related and organizational expenses. Prior to this offering, there has been no public market for our units, ordinary shares or rights. We intend to apply to list our units on The Nasdaq Global Market ( Nasdaq ) under the symbol DMIIU on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on Nasdaq. The ordinary shares Table of Contents and rights constituting the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless Cantor informs us of its decision to allow earlier separate trading, subject to our filing a Current Report on Form 8-K with the Securities and Exchange Commission (the SEC ) containing an audited balance sheet of the company reflecting our receipt of the gross proceeds of this offering and issuing a press release announcing when such separate trading will begin. Once the securities constituting the units begin separate trading, we expect that the ordinary shares and rights will be listed on Nasdaq under the symbols DMII and DMIIR, respectively. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 41 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. No offer or invitation, whether directly or indirectly, is being or may be made to the public in the Cayman Islands to subscribe for any of our securities. Per Unit Total Public offering price $ 10.00 $ 500,000,000 Underwriting discounts and commissions(1) $ 0.55 27,500,000 Proceeds, before expenses, to us $ 9.45 472,500,000 ____________ (1) Includes $0.20 per unit (excluding any units sold pursuant to the underwriters over-allotment option), or $10,000,000 in the aggregate (whether or not the underwriters over-allotment option is exercised), payable to Cantor upon the closing of this offering. Also includes $0.35 per unit on units other than those sold pursuant to the underwriters over-allotment option and $0.55 per unit on units sold pursuant to the underwriters over-allotment option, or $17,500,000 in the aggregate or up to $21,625,000 in the aggregate if the underwriters over-allotment option is exercised in full, payable to Cantor for deferred underwriting commissions to be deposited into a trust account located in the United States and released to Cantor for its own account only upon the completion of an initial business combination. See also Underwriting for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private units described in this prospectus, $500 million, or $575 million if the underwriters over-allotment option is exercised in full ($10.00 per unit), will be deposited into a U.S.-based trust account established by Continental Stock Transfer & Trust Company acting as trustee. Except with respect to interest earned on the funds held in the trust account that may be released to us to pay our taxes, if any (but without deduction for any excise or similar tax that may be due or payable), the funds held in the trust account will not be released from the trust account until the earliest to occur of: (1) our completion of an initial business combination; (2) the redemption of any public shares properly submitted in connection with a shareholder vote to amend our amended and restated memorandum and articles of association (A) to modify the substance or timing of our obligation to allow redemption in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination within the completion window or (B) with respect to any other material provisions relating to shareholders rights or pre-initial business combination activity; and (3) the redemption of our public shares if we have not completed an initial business combination within the completion window, subject to applicable law. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2025. Sole Book-Running Manager Cantor The date of this prospectus is , 2025. Table of Contents We are responsible for the information contained in this prospectus. We have not, and the underwriters have not, authorized anyone to provide any information or to make any representations other than those contained in this prospectus. We and the underwriters take no responsibility for and can provide no assurance as to the reliability of, any other information that others may give you. We are not, and the underwriters are not, making an offer to sell securities in any jurisdiction where the offer or sale is not permitted. You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front of this prospectus. TABLE OF CONTENTS PAGE Summary 1
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diff --git a/parsed_sections/prospectus_summary/2025/EDGM_edgemode_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/EDGM_edgemode_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a7213a37ab5f018bb4ed8ffb0b2b6bddae7eaef1
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/EDGM_edgemode_prospectus_summary.txt
@@ -0,0 +1,159 @@
+PROSPECTUS SUMMARY
+
+ 
+
+This summary highlights
+information contained elsewhere in this prospectus or incorporated by reference. It may not contain all of the information that you should
+consider before investing in our securities. You should read this entire prospectus carefully, including the Risk Factors 
+section, and the financial statements and related notes included herein. This prospectus includes forward-looking statements that involve
+risks and uncertainties. See Cautionary Statement Regarding Forward-Looking Statements. 
+
+ 
+
+Corporate Information
+
+ 
+
+Our company was formed under the laws of the
+state of Nevada in 2011. Our address is 110 E. Broward Blvd., Suite 1700, Ft. Lauderdale, Florida 33301, and our telephone number is
+(954) 380-3343. Our website address is www.edgemode.io. Our website and the information contained on, or that can be accessed
+through, our website is not deemed to be incorporated by reference into, and does not constitute part of, this prospectus.
+
+ 
+
+Our Company 
+
+ 
+
+Edgemode is seeking to provide artificial
+intelligence ( AI ) data center infrastructure and energy infrastructure development services to third-party customers focused
+on cloud computing, machine learning and AI.
+
+ 
+
+We focus on hyperscale cloud-based providers and
+enterprises, including potential customers that we believe have significant data center infrastructure needs that have not yet been outsourced
+or will require additional data center space and power to support their growth and their increasing reliance on technology infrastructure
+in their operations.
+
+ 
+
+The ClearThink Transaction
+
+ 
+
+On September 4, 2025, the Company entered into
+the Purchase Agreement with ClearThink, which provides that, subject to the terms and conditions set forth therein, the Company may receive
+from ClearThink up to $50,000,000 in aggregate gross proceeds from sales of the Company s common stock, par value $0.001 per share.
+In connection with the Purchase, the Company also issued 25,000,000 restricted shares of common stock (the Commitment Shares )
+to the Selling Stockholder. The Commitment Shares shall not be registered under this Registration Statement.
+
+ 
+
+On
+September 2, 2025, the Company also entered into a securities purchase agreement with an ClearThink, pursuant to which the Company sold
+ClearThink an unsecured original issue discount promissory note effective August 20, 2025 in the principal amount of $172,500 (the First
+Promissory Note ) for which the Company received net proceeds of $150,000. Pursuant to the agreement, the Company also sold ClearThink
+an unsecured original discount promissory note in the principal amount of $115,000 (the Second Promissory Note ) for which
+the Company received net proceeds of $100,000 (collectively, the First and Second Promissory Notes in the aggregate principal amount of
+$287,500 shall be referred to as the ClearThink Promissory Notes ). The ClearThink Promissory Notes are convertible 180 days
+after the date of issuance, or upon an event of default, at $0.01 per share (the Conversion Price ). If six months after
+the date of issuance the Company s common stock trades below $0.01 per share for more than five consecutive trading days, the Conversion
+Price will be reduced to $0.0075 per share. In the event that the Company s common stock trades below $0.0075 for more than five
+consecutive trading days, the Conversion Price shall be eliminated and reset to the lowest traded price during the period of default.
+The ClearThink Promissory Notes also provide that the holder may not convert any portion of the notes if such conversion would result
+in the holder beneficially owning more than 9.99% of the Company s then outstanding shares of common stock.
+The proceeds from the sale of the Promissory Notes shall be used for working capital. The shares of common stock from the conversion of
+any amounts due pursuant to the ClearThink Promissory Notes shall not be registered under this Registration Statement.
+
+ 
+
+ 
+
+ 
+
+ 3 
+
+ 
+
+ 
+
+ 
+
+Effective
+October 3, 2025, the Company entered into a securities purchase agreement dated September 30, 2025 with ClearThink, pursuant to which
+the Company sold an unsecured original issue discount promissory note in the principal amount of $287,500. The Company received net proceeds
+of $250,000 in consideration of issuance of the unsecured original discount promissory note and the proceeds from the sale shall be used
+for working capital. Pursuant to the securities purchase agreement, as consideration for the purchase of the unsecured original issue
+discount promissory note, the Company issued 17,000,000 shares of the Company s common stock to ClearThink.
+
+ 
+
+The transactions contemplated by the Purchase
+Agreement are subject to the Company registering the Selling Stockholders resale of the Purchase Shares on a registration statement to
+be filed with the SEC. Concurrent with the execution of the Purchase Agreement, the Company entered into a registration rights agreement
+with the Selling Stockholder (the Registration Rights Agreement ). Pursuant to the Registration Rights Agreement, the Company
+agreed to file a registration statement on Form S-1 (the Registration Statement ) with the SEC covering the resale of the
+Purchase Shares sold under the Purchase Agreement, within 45 days of the date of execution of the Purchase Agreement and Registration
+Rights Agreement and to use its best efforts to have the Registration Statement and any amendment declared effective by the SEC at the
+earliest possible date. The registration rights granted under the Registration Rights Agreement are subject to certain conditions and
+limitations and are subject to customary indemnification and contribution provisions.
+
+ 
+
+We do not
+have a right to commence any sales of common stock to the Selling Stockholder under the Purchase Agreement until the satisfaction of the
+conditions set forth in the Purchase Agreement. Over the 24-month period from and after the Commencement Date (unless the Purchase Agreement
+is terminated earlier in accordance with its terms), the Selling Stockholder has no right to require us to sell any shares of common stock
+to the Selling Stockholder, but subject to the satisfaction of the conditions set forth in the Purchase Agreement, the Selling Stockholder
+is obligated to make purchases as we direct in accordance with the terms of the Purchase Agreement. The Company s irrevocable written
+request to the Selling Stockholder to purchase shares of common stock (a Request Notice ) shall be limited to the lesser
+of $1,000,000 or 500% of the average number of shares traded for the five trading days prior to the date of the request, however the company
+may not submit a request to the Selling Stockholder until the resale of the shares has been registered. The minimum request the Company
+may submit is $25,000. Any day on which the Selling Stockholder makes a purchase pursuant to a Request Notice by the Company shall be
+a Purchase Date. Any Request Notice will depend on a variety of factors to be determined by us from time to time, including,
+among others, market conditions, the trading price of our common stock and determinations by us as to the appropriate sources of funding
+for us and our operations.
+
+ 
+
+In no event
+shall we issue or sell, and the Selling Stockholder is not obligated to purchase or acquire, any shares of common stock pursuant
+to the Purchase Agreement which, when aggregated with all other shares of common stock then beneficially owned by the Selling Stockholder
+and its affiliates (as calculated pursuant to Section 13(d) of the Securities Exchange Act of 1934, and Rule 13d-3 promulgated thereunder),
+would result in the Selling Stockholder beneficially owning more than 9.99% of the then issued and outstanding shares of common stock
+(the Beneficial Ownership Limitation ).
+
+ 
+
+The net proceeds under the Purchase Agreement
+to us will depend on the frequency and prices at which we sell shares of our stock to the Selling Stockholder. We intend to use the net
+proceeds for working capital and general corporate purposes. We will retain broad discretion over the use of the net proceeds from this
+offering.
+
+ 
+
+We have the right to terminate the Purchase Agreement
+at any time, upon five business days notice, at no cost or penalty. However, no termination of the Purchase Agreement shall (i)
+affect the Company s or the Selling Stockholder s rights or obligations under (A) the Purchase Agreement with respect to pending
+purchases and the Company and the Selling Stockholder shall complete their respective obligations with respect to any pending purchases
+under the Purchase Agreement and (B) the Registration Rights Agreement.
+
+ 
+
+There are substantial risks to our stockholders
+as a result of the sale and issuance of common stock to the Selling Stockholder under the Purchase Agreement, including but not limited
+to the following: substantial dilution, significant declines in our stock price and our inability to draw sufficient funds when needed.
+See Risk Factors. The sale of our common stock to the Selling Stockholder under the Purchase Agreement will not affect the
+rights or privileges of our other stockholders, except that the economic and voting interests of our existing stockholders will be diluted
+as a result of any such sale. Although the number of shares of common stock that our other stockholders own will not decrease, the shares
+owned by our other stockholders will represent a smaller percentage of our total outstanding shares after any such sale to the Selling
+Stockholder under the Purchase Agreement.
+
+ 
+
+ 
+
+ 
+
+ 4
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/EDHL_everbright_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/EDHL_everbright_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2afe0c4544b3d852ee9373c1ea81cbc648f7178a
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/EDHL_everbright_prospectus_summary.txt
@@ -0,0 +1 @@
+F-1 1 ea0244720-f1_everbright.htm REGISTRATION STATEMENT Registration No. 333- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM F-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 Everbright Digital Holdings Limited (Exact name of registrant as specified in its charter) Cayman Islands 7319 Not Applicable (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification No.) Unit 1A, 10/F, C-Bons International Centre, 108 Wai Yip Street, Kwun Tong, Hong Kong (Address, including zip code, and telephone number, including area code, of Registrant s principal executive offices) Cogency Global Inc. 122 East 42nd Street, 18th Floor New York, New York 10168 800-221-0102 (Name, address, including zip code, and telephone number, including area code, of agent for service) With a Copy to: William S. Rosenstadt, Esq. Mengyi "Jason" Ye, Esq. Yarona Yieh, Esq. Ortoli Rosenstadt LLP 366 Madison Avenue 3rd Floor New York, NY 10017 Telephone: (212) 588 0022 Approximate date of commencement of proposed sale to the public: Promptly after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933. Emerging growth company If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. The information in this prospectus is not complete and may be changed. Neither we nor the Selling Shareholders may sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED JUNE 5, 2025 7,000,000 Ordinary Shares to be sold by the Selling Shareholders Everbright Digital Holdings Limited This prospectus relates to the offer and resale, by the Selling Shareholders identified in this prospectus, of up to 7,000,000 ordinary shares with US$0.00004 par value per share ("Ordinary Shares") of Everbright Digital Holdings Limited ("Everbright Cayman" or the "Company"), a Cayman Islands exempted company with limited liability. Our Ordinary Shares trade on the Nasdaq Stock Market under the symbol "EDHL." On June 5, 2025, the closing price of our Ordinary Shares was $4.5300 per share. The Selling Shareholders are identified in the table commencing on page 29 of this prospectus. The Selling Shareholders may offer, sell or distribute all or a portion of the securities hereby registered publicly or through private transactions at prevailing market prices. No underwriter or other person has been engaged to facilitate the sale of the Ordinary Shares in this offering. The Selling Shareholders may be deemed underwriters of the Ordinary Shares that it is offering. We will not receive any of the proceeds from such sales of the Ordinary Shares. We will bear all costs, expenses, and fees in connection with the registration of these securities, including with regard to compliance with state securities or "blue sky" laws. The Selling Shareholders will bear all commissions and discounts, if any, attributable to their sale of Ordinary Shares. See "Plan of Distribution" beginning on page 30. Throughout this prospectus, unless the context indicates otherwise, any references to "Everbright Cayman," "the Company," or "our Company" are to Everbright Digital Holding Limited, a Cayman Islands holding company. The Company is a Cayman Islands holding company that conducts its operations and operates its business in Hong Kong through its subsidiary, Hong Kong United Metaverse Limited. Investors are cautioned that you are not buying shares of a Hong Kong-based operating company but instead are buying shares of a Cayman Islands holding company with operations conducted by our subsidiary based in Hong Kong and that this structure involves unique risks to investors. See "Risk Factors — Risks Related to Doing Business in the Jurisdictions in which We Operate — Investors are cautioned that you are buying shares of a Cayman Islands holding company with operations conducted in Hong Kong by its subsidiary" which is incorporated by reference from the Company s Annual Report on Form 20-F for the fiscal year ended December 31, 2024, as filed with the Securities and Exchange Commission on May 16, 2025 (File No.: 001-42602). Furthermore, Chinese regulatory authorities could change the rules and regulations regarding foreign ownership in the industry in which the Company operates, which would likely result in a material change in our operations and/or a material change in the value of the securities we are registering for sale, including that it could cause the value of such securities to significantly decline or become worthless. Investors in our Ordinary Shares should be aware that they do not directly hold equity interests in the operating subsidiaries in Hong Kong, but rather are purchasing equity in Everbright Digital Holding Limited, our Cayman Islands holding company, which indirectly owns 100% equity interest in the operating subsidiaries in Hong Kong. See "Risk Factors — Risks Related to Doing Business in the Jurisdictions in which We Operate" which is incorporated by reference from the Company s Annual Report on Form 20-F for the fiscal year ended December 31, 2024, as filed with the Securities and Exchange Commission on May 16, 2025 (File No.: 001-42602). Everbright Digital Holding Limited, or Everbright Cayman, is a holding company incorporated in the Cayman Islands with no material operations of its own, and we conduct all our operations in Hong Kong through Hong Kong United Metaverse Limited, or HKUML. References to the "Company," "we," "us," and "our" in the prospectus are to Everbright Cayman, the Cayman Islands entity that will issue the Ordinary Shares being offered, and its subsidiaries. References to "HKUML" or "Operating Subsidiary" are to our sole operating subsidiary as of the date of this prospectus. This is an offering of the Ordinary Shares of Everbright Cayman, the holding company in the Cayman Islands, instead of the shares of HKUML. Investors in this offering may never directly hold any equity interests in HKUML. Investing in our Ordinary Shares involves a high degree of risk, including the risk of losing your entire investment. See "Item 3.D. Risk Factors" which is incorporated by reference from the Company s Annual Report on Form 20-F for the fiscal year ended December 31, 2024, as filed with the Securities and Exchange Commission on May 16, 2025 (File No.: 001-42602). We are an "Emerging Growth Company" and a "Foreign Private Issuer" under applicable U.S. federal securities laws and are, therefore, eligible for reduced public company reporting requirements. Please read "Emerging Growth Company Status" beginning on page 20 and "Foreign Private Issuer Status" beginning on page 20 for more information. We are a "controlled company" as defined under the Nasdaq Listing Rules, because Dr. Leung Chun Yip, our controlling shareholder who beneficially owns approximately 67.52% of the aggregate voting power of our issued and outstanding Ordinary Shares, will continue to own more than a majority of the voting power of our outstanding Ordinary Shares. As a result, Dr. Leung Chun Yip can control the outcome of matters submitted to the shareholders for approval. Additionally, we may elect to take advantage of certain exemptions from certain corporate governance requirements that could adversely affect our public shareholders. For a more detailed discussion of the risk of the Company being a controlled company, see "Risk Factors — Our corporate actions will be substantially controlled by our Controlling Shareholder, Dr. Leung Chun Yip, which has the ability to control or exert significant influence over important corporate matters that require approval of shareholders, which may deprive you of an opportunity to receive a premium for your Ordinary Shares and materially reduce the value of your investment. Additionally, we are deemed to be a "controlled company and may follow certain exemptions from certain corporate governance requirements that could adversely affect our public shareholders" which is incorporated by reference from the Company s Annual Report on Form 20-F for the fiscal year ended December 31, 2024, as filed with the Securities and Exchange Commission on May 16, 2025 (File No.: 001-42602) and "Prospectus Summary — Implication of Being a Controlled Company" on page 19 of this prospectus. Everbright Digital Holdings Limited is not a PRC or Hong Kong operating company, but a holding company incorporated in the Cayman Islands. As a holding company with no material operations, Everbright Digital Holdings Limited conducts all of its operations in Hong Kong through its subsidiary, Hong Kong United Metaverse Limited (the "Operating Subsidiary"), which was incorporated in Hong Kong. Investors are cautioned that you are not buying shares of a Hong Kong-based operating company but instead are buying shares of a Cayman Islands holding company with operations conducted by our subsidiary based in Hong Kong. This structure involves unique risks to the investors, and the PRC regulatory authorities could disallow this structure, which would likely result in a material change in our operations and/or a material change in the value of our Ordinary Shares, including that such event could cause the value of such securities to significantly decline or become worthless. For more details, see "Risk Factors — Risks Related to Doing Business in the Jurisdictions in which we Operate — Investors are cautioned that you are buying shares of a Cayman Islands holding company with operations conducted in Hong Kong by its subsidiary" which is incorporated by reference from the Company s Annual Report on Form 20-F for the fiscal year ended December 31, 2024, as filed with the Securities and Exchange Commission on May 16, 2025 (File No.: 001-42602). We are subject to certain legal and operational risks associated with having all business operations in Hong Kong, a Special Administrative Region of the PRC, as well as the risks associated with having clients who are Mainland China individuals or companies that have shareholders or directors that are Mainland China individuals. We are also subject to the risks of uncertainty about any future actions the PRC government or authorities in Hong Kong may take in this regard. Such risks may include changes in the legal, political, and economic policies of the Chinese government, the relations between China and the United States, and Chinese or United States regulations that may materially and adversely affect our business, financial condition, results of operations and the market price of the Ordinary Shares. Any such changes could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and could cause the value of offered securities to significantly decline or become worthless. PRC laws and regulations governing our current business operations are sometimes vague and uncertain. Recently, the PRC government initiated a series of regulatory actions and made statements to regulate business operations in China with little advance notice, including cracking down on illegal activities in the securities market, adopting new measures to extend the scope of cybersecurity reviews, and expanding the efforts in anti-monopoly enforcement. Since these statements and regulatory actions are new, it is highly uncertain how soon legislative or administrative regulation making bodies will respond and what existing or new laws or regulations or detailed implementations and interpretations will be modified or promulgated, if any, and the potential impact such modified or new laws and regulations will have on the daily business operation of our HK subsidiary. Should the PRC government choose to exercise significant oversight and discretion over the conduct of our business, or in the event that we or the Operating Subsidiary were to become subject to PRC laws and regulations, we could incur material costs to ensure compliance, and we or the Operating Subsidiary might be subject to fines, experience devaluation of securities or delisting, no longer be permitted to conduct offerings to foreign investors, and/or no longer be permitted to continue business operations as presently conducted. See "Risk Factors — Risks Related to Doing Business in the Jurisdictions in which the We Operate" incorporated by reference from the Company s Annual Report on Form 20-F for the fiscal year ended December 31, 2024, as filed with the Securities and Exchange Commission on May 16, 2025 (File No.: 001-42602). Our Ordinary Shares may be prohibited from trading on a national exchange or "over-the-counter" markets under the Holding Foreign Companies Accountable Act (the "HFCAA") if the Public Company Accounting Oversight Board ("PCAOB") determines that it is unable to inspect or fully investigate our auditor and as a result the exchange where our securities are traded may delist our securities. Furthermore, on June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act (the "AHFCAA"), which was signed into law on December 29, 2022, amending the HFCAA and requiring the SEC to prohibit an issuer s securities from trading on any U.S. stock exchange if its auditor is not subject to PCAOB inspections for two consecutive years instead of three consecutive years. Pursuant to the HFCAA, the PCAOB issued a Determination Report on December 16, 2021, which found that the PCAOB was unable to inspect or investigate completely certain named registered public accounting firms headquartered in Mainland China and Hong Kong. Our auditor, Onestop Assurance PAC, the independent registered public accounting firm that issues the audit report for the fiscal year ended December 31, 2024, 2023 and 2022, is currently subject to PCAOB inspections and the PCAOB is able to inspect our auditor. Onestop Assurance PAC, headquartered in Singapore, has been inspected by the PCAOB on a regular basis. Our auditor is not headquartered in Mainland China or Hong Kong and was not identified in this report as a firm subject to the PCAOB s determination. Therefore, we believe that, as of the date of this prospectus, our auditor is not subject to the PCAOB determinations. Notwithstanding the foregoing, in the future, if there is any regulatory change or step taken by PRC regulators that does not permit Onestop Assurance PAC to provide audit documentations located in China or Hong Kong to the PCAOB for inspection or investigation, or the PACOB expands the scope of the Determination so that we are subject to the HFCAA, as the same may be amended, you may be deprived of the benefits of such inspection which could result in limitation or restriction to our access to the U.S. capital markets and trading of our securities, including trading on the national exchange. See "Prospectus Summary — Implications of the Holding Foreign Companies Accountable Act (the "HFCAA")" on page 16 of this prospectus and "Risk Factors — Risks Related to Our Ordinary Shares — "Our Ordinary Shares may be prohibited from being traded on a national exchange under the Holding Foreign Companies Accountable Act if the PCAOB is unable to inspect our auditors. The delisting of our Ordinary Shares, or the threat of their being delisted, may materially and adversely affect the value of your investment. Furthermore, on June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act, which was signed into law on December 29, 2022, amending the HFCAA to require the SEC to prohibit an issuer s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three" which is incorporated by reference from the Company s Annual Report on Form 20-F for the fiscal year ended December 31, 2024, as filed with the Securities and Exchange Commission on May 16, 2025 (File No.: 001-42602). We cannot assure you whether Nasdaq or other regulatory authorities will apply additional or more stringent criteria to us. Such uncertainty could cause the market price of our Ordinary Shares to be materially and adversely affected. Our management monitors the cash position of each entity within our organization regularly and prepares budgets on a monthly basis to ensure each entity has the necessary funds to fulfill its obligation for the foreseeable future and to provide adequate liquidity. In the event that there is a need for cash or a potential liquidity issue, it will be reported to our Chief Financial Officer and subject to approval by our board of directors, we will enter into an intercompany loan for the applicable subsidiary. Everbright Cayman is permitted under the laws of the Cayman Islands to provide funding to Everbright BVI through loans or capital contributions without restrictions on the amount of the funds. Everbright BVI is permitted under the respective laws of BVI to provide funding to HKUML through dividend distribution without restrictions on the amount of the funds. There are no restrictions on dividend transfers from BVI to Hong Kong. As a holding company, Everbright Cayman may rely on dividends and other distributions on equity paid by its subsidiaries for its cash and financing requirements. As of the date of this prospectus, Everbright Cayman and its subsidiaries do not have any plans to distribute earnings or settle amounts in the foreseeable future. During the fiscal years ended December 31, 2024 and 2023, no dividends or distribution have been made to date by our subsidiaries. Neither the Securities and Exchange Commission nor any state securities commission nor any other regulatory body has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2025. TABLE OF CONTENTS Page ABOUT THIS PROSPECTUS ii PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/ELAB_pmgc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/ELAB_pmgc_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/ELAB_pmgc_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/EPWK_epwk_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/EPWK_epwk_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/EPWK_epwk_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/EVAX_evaxion-a_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/EVAX_evaxion-a_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/EVAX_evaxion-a_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/FGL_founder_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/FGL_founder_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/FGL_founder_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/FGMCR_fg-merger_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/FGMCR_fg-merger_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..39877077379cc1b5e102f21df93828ece7b14c5b
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/FGMCR_fg-merger_prospectus_summary.txt
@@ -0,0 +1 @@
+elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under "Risk Factors" and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: "approved extension" are to an extension of the date by which we must complete our initial business combination as approved by the affirmative vote of the holders of a majority of the shares of our common stock that are voted at a stockholder meeting held to amend our organizational documents to extend such date, voting together as a single class; "directors" are to our current directors; "founder shares" are to shares of our common stock initially purchased by our sponsor in a private placement; "Fundamental Global" are to Fundamental Global, Inc. (NASDAQ: FGF), a public company, including its privately-held subsidiaries and affiliates. Mssrs. Cerminara, Swets and Baqar are investors in Fundamental Global, Inc. In addition, our directors Scott D. Wollney and Richard E. Govignon are also directors of Fundamental Global, Inc.; "initial stockholders" are to our sponsor and any other holders of our founder shares immediately prior to this offering; "management" or our "management team" are to our executive officers, directors and our senior advisor; "NASDAQ" are to the Nasdaq Stock Market LLC; "private placement" are to the private placement to our sponsor (and/or its designees) of the private units and the $15 Exercise Price Warrants that will occur simultaneously with this offering. "private placement securities" are to the private units (including the underlying private shares and private rights) and the $15 Exercise Price Warrants (including the underlying shares of common stock); "private rights" are to the rights sold as part of the private units; "private shares" are to the shares of common stock sold as part of the private units; "private units" are to the units issued to our sponsor (and/or its designees) in a private placement simultaneously closing with the closing of this offering, with each private unit consisting of one private share and one right to receive one-tenth (1/10) of a private share upon the consummation of an initial business combination; "public rights" refer to the rights which are being sold as part of the units in this offering; "public shares" are to shares of common stock sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); "public stockholders" are to the holders of our public shares, including our initial stockholders and management team to the extent our initial stockholders and/or members of our management team purchase public shares, provided that each initial stockholder s and member of our management team s status as a "public stockholder" will only exist with respect to such public shares; 1 "sponsor" are to FG Merger Investors II LLC, a Nevada limited liability company formed for the purpose of acting as the sponsor in connection with this offering and the sponsor conducts no other business; Larry G. Swets, Jr., Hassan R. Baqar, and D. Kyle Cerminara are the managing members of the sponsor, and each of Larry G. Swets, Jr., Hassan R. Baqar, and D. Kyle Cerminara own limited membership interests in our sponsor; "Underwriter Rights" are to the rights issued as part of the Underwriter Units; "Underwriter Shares" are to the shares of common stock issued as part of the Underwriter Units; "Underwriter Units" are to the units issued to ThinkEquity LLC, the representative of the underwriters of this offering, in a private placement simultaneously with the closing of this offering; "we," "us," "company," "Company" or "our company" are to FG Merger II Corp., a Nevada corporation; "$15 Exercise Price Warrants" are to the 1,000,000 warrants purchased by our sponsor at a price of $0.10 per warrant, each exercisable to purchase one share of common stock at $15.00 per share. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. 2
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/FIT_fitness_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/FIT_fitness_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..678dfa7cd29ebe032034cda038c3df7ec8253136
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/FIT_fitness_prospectus_summary.txt
@@ -0,0 +1,841 @@
+Prospectus Summary," "Risk Factors," "Use
+of Proceeds," "Management s Discussion and Analysis of Financial Condition and Results of Operations," and "Business."
+These statements relate to events that involve known and unknown risks, uncertainties and other factors, including those listed under
+"Risk Factors," which may cause our actual results, performance or achievements to be materially different from any future
+results, performance or achievements expressed or implied by the forward-looking statements.
+
+ 
+
+In
+some cases, these forward-looking statements can be identified by words or phrases such as "believe," "plan,"
+"expect," "intend," "should," "seek," "estimate," "will," "aim"
+and "anticipate" or other similar expressions, but these are not the exclusive means of identifying such statements. All
+statements other than statements of historical facts included in this document, including those regarding future financial position and
+results, business strategy, plans and objectives of management for future operations (including development plans and dividends) and
+statements on future industry growth are forward-looking statements. In addition, we and our representatives may from time to time make
+other oral or written statements which are forward-looking statements, including in our periodic reports that we will file with the SEC,
+other information sent to our shareholders and other written materials.
+
+ 
+
+These
+forward-looking statements are subject to risks, uncertainties and assumptions, certain of which are beyond our control. In addition,
+these forward-looking statements reflect our current views with respect to future events and are not a guarantee of future performance.
+Actual outcomes may differ materially from the information contained in the forward-looking statements as a result of a number of factors,
+including, without limitation, the risk factors set forth in "Risk Factors" and the following:
+
+ 
+
+ 
+ 
+ our
+ business and operating strategies and our various measures to implement such strategies;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ operations and business prospects, including development and capital expenditure plans for our existing business;
+
+ 
+ 
+ 
+
+ 
+ 
+ changes
+ in policies, legislation, regulations or practices in the industry and place in which we operate that may affect our business operations;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ financial condition, results of operations and dividend policy;
+
+ 
+ 
+ 
+
+ 
+ 
+ changes
+ in political and economic conditions and competition in the sale and distribution on sports nutrition products and related
+ industry;
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ regulatory environment and industry outlook in general;
+
+ 
+ 
+ 
+
+ 
+ 
+ catastrophic
+ losses from man-made or natural disasters, such as fires, floods, windstorms, earthquakes, diseases, epidemics, other adverse weather
+ conditions or natural disasters, war, international or domestic terrorism, civil disturbances and other political or social occurrences;
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ loss of key personnel and the inability to replace such personnel on a timely basis or on terms acceptable to us;
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ overall economic environment and general market and economic conditions in Hong Kong, the PRC and Malaysia;
+
+ 
+ 
+ 
+
+ 
+ 
+ changes
+ in the need for capital and the availability of financing and capital to fund those needs;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ ability to anticipate and respond to changes in consumer performances, tastes and trends; and
+
+ 
+ 
+ 
+
+ 
+ 
+ legal,
+ regulatory and other proceedings arising out of our operations.
+
+ 
+ 
+
+The
+forward-looking statements made in this prospectus relate only to events or information as of the date on which the statements are made
+in this prospectus. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements,
+whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the
+occurrence of unanticipated events. You should read this prospectus and the documents that we reference in this prospectus and have filed
+as exhibits to the Registration Statement, of which this prospectus is a part, completely and with the understanding that our actual
+future results or performance may be materially different from what we expect.
+
+ 
+
+ 2
+
+ 
+
+ 
+
+ 
+
+DEFINITIONS
+
+ 
+
+ 
+ "Ace"
+ 
+ means
+ Ace August Limited, a company incorporated in the BVI with limited liability, which is wholly-owned by Mr. Leung Chi Man Kenny, an
+ Independent Third Party.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Articles
+ of Association" or "Articles"
+ 
+ means
+ the articles of association of our Company as adopted on March 28, 2025
+
+ 
+ 
+ 
+ 
+
+ "B2B"
+ 
+ means business-to-business.
+
+ 
+ 
+ 
+
+ "B2C"
+ 
+ means business-to-consumer.
+
+ 
+ 
+ 
+
+ "Billion"
+ 
+ means
+ Billion Track Enterprises Limited, a company incorporated in the BVI with limited liability, which is wholly-owned by Ms. Cheung
+ Siu Ning, an Independent Third Party.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Blueberry"
+ 
+ means
+ Blueberry Farm Holdings Limited, a company incorporated in the BVI with limited liability, which is wholly-owned by Ms. Suen Tin
+ Yan, an Independent Third Party.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Board"
+
+ 
+ means
+the board of Directors of the Company.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Chestnut"
+ 
+ means
+ Chestnut Festival Limited, a company incorporated in the BVI with limited liability, which is wholly-owned by Mr. Zhang Yan,
+ an Independent Third Party.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Cipher"
+ 
+ means
+ Cipher Future Development Limited, a company incorporated in the BVI and wholly-owned by Amber International Holding Limited (formerly
+ known as "iClick Interactive Asia Group Limited", whose shares are listed on the Nasdaq Global Market
+ (stock code: AMBR), and an existing shareholder of our Company.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Comet"
+ 
+ means
+ Comet Moment Limited, a company incorporated in the BVI with limited liability, which is wholly-owned by Mr. Lim Jia Li, an Independent
+ Third Party.
+
+ 
+ 
+ 
+ 
+
+ 
+ "CNY"
+ 
+ means Chinese Reminbi, the lawful currency of China.
+
+ 
+ 
+
+ 3
+
+ 
+
+ 
+
+ 
+
+ 
+ "Companies
+ Act"
+ 
+ means
+ the Companies Act (as revised) of the Cayman Islands, as amended, supplemented or otherwise modified from time to time.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Companies
+ Ordinance"
+ 
+ means
+ the Companies Ordinance (Chapter 622 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to time.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Director(s)"
+ 
+ means director(s) of the Company.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Dixon"
+ 
+ means
+ Dixon Dynamics Company Limited, a company incorporated in the BVI with limited liability, which is wholly-owned by Mr. Chan.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Employees 
+ Compensation Ordinance"
+ 
+ means
+ the Employees Compensation Ordinance (Chapter 282 of the Laws of Hong Kong), as amended, supplemented or otherwise modified
+ from time to time.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Employment
+ Ordinance"
+ 
+ means
+ the Employment Ordinance (Chapter 57 of the Laws of Hong Kong, as amended, supplemented or otherwise modified from time to time).
+
+ 
+ 
+ 
+ 
+
+ 
+ "Elytron"
+ 
+ means
+ Elytron Innovations Limited, a company incorporated in the BVI with limited liability, which is wholly-owned by Mr. Luk.
+
+ 
+ 
+
+ 
+ "Feldspar"
+ 
+ means
+ Feldspar Enterprises Limited, a company incorporated in the BVI with limited liability, which is wholly-owned by Mr. Wong Hung Kai,
+ an Independent Third Party.
+
+ 
+ 
+ 
+ 
+
+ 
+ "FFA"
+ 
+ means
+ Fitness Fanatics Asia Limited, a company incorporated in the British Virgin Islands and a
+ direct wholly-owned subsidiary of our Company.
+
+ 
+
+ 
+ "FINRA"
+ 
+ means
+ Financial Industry Regulatory Authority, Inc. 
+
+ 
+ 
+ 
+ 
+
+ 
+ "Group,"
+ "our Group," "we" or "us"
+ 
+ means
+ our Company and our subsidiaries. 
+
+ 
+ 
+ 
+ 
+
+ 
+ "HK$,"
+ "Hong Kong dollars" or "HK dollars" 
+ 
+ means
+ Hong Kong dollars, the lawful currency of Hong Kong. 
+
+ 
+ 
+
+ 4
+
+ 
+
+ 
+
+ 
+
+ 
+ "Hong
+ Kong Subsidiaries"
+ 
+ means
+ collectively NWG and Myron.
+
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ "Hintech"
+ 
+ means
+ Hintech Solutions Limited, a company incorporated in the BVI with limited liability, which is wholly-owned by Mr. Ho.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Independent
+ Third Party(ies)"
+ 
+ means/mean
+ a person or company who or which is independent
+ of and is not a 5% beneficial owner (as defined in Rule 13d-3 promulgated under the Exchange Act) of, does not control and is not
+ controlled by or under common control with any 5% owner and is not the spouse or descendant (by birth or adoption) of any 5% beneficial
+ owner of the Company. 
+
+ 
+ 
+ 
+ 
+
+ 
+ "Listing"
+ 
+ means
+ the listing of our Class A Ordinary Shares on the Nasdaq Capital Market or other national securities exchange. 
+
+ 
+ 
+ 
+ 
+
+ 
+ "Mainland China"
+ 
+ means Chinese mainland of the PRC, excluding Hong Kong
+ and Macau.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Macau"
+ 
+ means
+ the Macau Special Administrative Region of the PRC.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Mandatory
+ Provident Fund Schemes Ordinance"
+ 
+ means
+ the Mandatory Provident Fund Schemes Ordinance (Chapter 485 of the Laws of Hong Kong), as amended, supplemented or otherwise modified
+ from time to time.
+
+ 
+ 
+
+ 
+ "Memorandum
+ of Association" or "Memorandum"
+ 
+ means
+ the memorandum of association of our Company as adopted on March 28, 2025 
+
+ 
+ 
+ 
+ 
+
+ 
+ "Minimum
+ Wage Ordinance"
+ 
+ means
+ the Minimum Wage Ordinance (Chapter 608 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to time.
+
+ 
+ 
+ 
+ 
+
+ 
+ "MPF"
+ 
+ means
+ mandatory provident fund to be contributed by an employer in accordance with the Mandatory Provident Fund Schemes Ordinance in
+ Hong Kong.
+
+ 
+ 
+ 
+ 
+
+ 
+ "MPF
+ Authority"
+ 
+ means
+ the Mandatory Provident Fund Scheme Authority of Hong Kong. 
+
+ 
+ 
+ 
+ 
+
+ 
+ "Mr.
+ Chan"
+ 
+ means
+ Mr. Chan Chun Ming, Dickson, a co-founder and an executive director of our Company.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Mr.
+ Chen Jackson Jadyn"
+ 
+ means
+ Mr. Chen Jackson Jadyn, an Independent Third Party.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Mr.
+ Chen"
+ 
+ means
+ Mr. Chen Wei, an Independent Third Party.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Mr.
+ Ho"
+ 
+ means
+ Mr. Ho Hin Shun, our founder, an executive director and the chief executive officer of our Company.
+
+ 
+ 
+
+ 5
+
+ 
+
+ 
+
+ 
+
+ 
+ "Mr.
+ Luk"
+ 
+ means
+ Mr. Luk Jing Won, Elson, a co-founder and existing shareholder of our Company.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Mr.
+ Mak"
+ 
+ means
+ Mr. Mak Tsz Wa, an Independent Third Party.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Mr. Ngan"
+ 
+ means Mr. Ngan Chun Wai William, an Independent Third
+ Party.
+
+ 
+ 
+ 
+ 
+
+ 
+ "MYR"
+
+ 
+ means
+ Malaysian Ringgits, the lawful currency of Malaysia.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Ordinary
+ Share(s)"
+ 
+ means
+ collectively the Class A Ordinary Share(s) and Class B Ordinary Share(s). 
+
+ 
+ 
+ 
+ 
+
+ 
+ "Operating Subsidiaries"
+ 
+ means NWG, Myron, NWSZ, NWSH, Qing Mu and FIT Food.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Pandemic"
+ 
+ means
+ the COVID-19 pandemic which persisted from early 2020 to late 2022.
+
+ 
+ 
+ 
+ 
+
+ 
+ "PRC
+ Subsidiaries"
+ 
+ means
+ collectively NWSZ, NWSH and Qing Mu.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Regulation
+ S"
+ 
+ means
+ Regulation S under the Securities Act. 
+
+ 
+ 
+ 
+ 
+
+ 
+ "Sarbanes
+ Oxley Act"
+ 
+ means
+ The Sarbanes-Oxley Act of 2002. 
+
+ 
+ 
+ 
+ 
+
+ 
+ "SEC"
+ 
+ means
+ The United States Securities and Exchange Commission. 
+
+ 
+ 
+ 
+ 
+
+ 
+ "Securities
+ Act"
+ 
+ means
+ the Securities Act of 1933, as amended. 
+
+ 
+ 
+ 
+ 
+
+ 
+ "Supreme"
+ 
+ means
+ Supreme Mind Limited, a limited liability company incorporated in Hong Kong and owned as to 33% by Ms. Yuan Ying, 33% by Ms. Yuan
+ Fengnu, 20% by Mr. Kung Ching Yao Jimmy and 13% by Ms. Chen Tina P T, all Independent Third Parties.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Tenmoku"
+ 
+ means
+ Tenmoku Limited, a company incorporated in the BVI with limited liability, which is wholly-owned by Ms. Yip Ka Ki Cherry, an Independent
+ Third Party.
+
+ 
+ 
+ 
+ 
+
+ 
+ "Track
+ Record Period"
+ 
+ means
+ the period commencing from January 1, 2023 to December 31, 2024.
+
+ 
+ 
+ 
+ 
+
+ 
+ "U.S.,"
+ "United States" or "US" 
+ 
+ means
+ the United States of America. 
+
+ 
+ 
+ 
+ 
+
+ 
+ "US$",
+ "USD" or "U.S. dollars"
+ 
+ 
+ means
+ United States dollars, the lawful currency of the United States of America. 
+
+ 
+ 
+ 
+ 
+
+ 
+ *
+ denotes that the company is established in the PRC without an English name. The English name is just a transliteration of the company s
+ Chinese name for reference only.
+
+ 
+ 
+
+ 6
+
+ 
+
+ 
+
+ 
+
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that may be
+important to you, and we urge you to read this entire prospectus carefully, including the "Risk Factors," "Business"
+and "Management s Discussion and Analysis of Financial Condition and Results of Operations" sections and our combined
+financial statements and notes to those statements, included elsewhere in this prospectus, before deciding to invest in our Class
+A Ordinary Shares. This prospectus includes forward-looking statements that involve risks and uncertainties. See "
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/FMFC_kandal-m_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/FMFC_kandal-m_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/FMFC_kandal-m_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/FOFO_hang-feng_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/FOFO_hang-feng_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/FOFO_hang-feng_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/FTFT_future_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/FTFT_future_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/FTFT_future_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/GDHG_golden_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/GDHG_golden_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/GDHG_golden_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/GINT_gifts_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/GINT_gifts_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/GINT_gifts_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/GLSA_green_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/GLSA_green_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/GLSA_green_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/GVH_globavend_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/GVH_globavend_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/GVH_globavend_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/HCHL_happy_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/HCHL_happy_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/HCHL_happy_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/HNGE_hinge_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/HNGE_hinge_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/HNGE_hinge_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/HUBCZ_hub-cyber_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/HUBCZ_hub-cyber_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..103780a48fedac907e33dc3fd87fa37811c2378a
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/HUBCZ_hub-cyber_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights, and is qualified in its entirety by, the more detailed information included elsewhere in this prospectus. This summary does not contain all of the information that may be important to you. You should read and carefully consider the entire prospectus, especially the Risk Factors section of this prospectus, before deciding to invest in our ordinary shares. Unless the context otherwise requires, we use the terms company, we, us and our in this prospectus to refer to HUB Cyber Security Ltd. and subsidiaries. The Company began operations in 1984 as A.L.D. Advanced Logistics Development Ltd. ( ALD ) and is engaged in developing and marketing quality management software tools and solutions. HUB Cyber Security TLV Ltd. ( HUB TLV ) was founded in 2017 by veterans of the elite Unit 8200 and Unit 81 of the Israeli Defense Forces, with vast experience and proven track records in setting up and commercializing start-ups in a multi-disciplinary environment. On February 28, 2021, HUB TLV and ALD signed a share swap merger agreement, pursuant to which HUB TLV became a wholly owned subsidiary of ALD and the shareholders of HUB TLV owned 51% of ALD s issued and outstanding share capital (the ALD Merger ). The ALD Merger was completed on June 21, 2021 and ALD later changed its name to Hub Cyber Security (Israel) Ltd. and later to Hub Cyber Security Ltd. Following the ALD Merger, we have developed unique technology and products in the field of confidential computing, with the intention to be a significant player in the cyber security industry. In November 2023, we began to collaborate with BlackSwan Technology ( BST ) with the goal of becoming a significant player in the secured data fabric industry. Subsequently, in August 2024, we entered into a collaboration agreement with BST formalizing the terms of the collaboration between the parties (the BST Collaboration Agreement ). The BST Collaboration Agreement was effective as of November 1, 2023, and pursuant to the terms thereof, BST agreed to conduct activities directed by us to integrate BST s technology with our technology. In addition, we agreed to provide advisory services to BST in connection with BST s performance under specified commercial agreements. Pursuant to the BST Collaboration Agreement, we received all rights to any deliverables created under the BST Collaboration Agreement and an irrevocable, perpetual license to any BST background intellectual property created or developed before or after the effective date of the BST Collaboration Agreement. The BST Collaboration Agreement further granted us with the exclusive right available until August 22, 2025 to elect to acquire all of the outstanding share capital of BST or assets of BST. We subsequently exercised this right and acquired BST on January 27, 2025. We believe that the transaction with BST will solidify our position as a leading provider of secured data fabric solutions, offering these technologies and solutions to government entities, banks and financial institutions, and large regulated enterprises. We currently operate in several countries and provide secured data fabric SaaS solutions (through the BST collaboration), as well as a wide range of cybersecurity professional services. Corporate Information Our website address is www.hubsecurity.com. Information contained on, or that can be accessed through, our website does not constitute a part of this prospectus. We have included our website address in this prospectus solely for informational purposes. The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers, such as we, that file electronically, with the SEC at www.sec.gov. The main address of our principal executive offices is 2 Kaplan Street, Tel Aviv, Israel and our telephone number is +972-3-791-3200. Our agent for service of process in the United States is Puglisi & Associates, 850 Library Avenue, Newark, Delaware 19711. We are registered with the Israeli Registrar of Companies (registration number 511029373). 1 Reverse Share Splits On December 15, 2023, following approval by our shareholders and Board of Directors, we effected a reverse share split of our authorized and outstanding ordinary shares, at a ratio of 10:1 whereby each 10 ordinary shares were reverse split into one ordinary share (with fractional shares being rounded down) (the 2023 Reverse Share Split ). In addition, on March 28, 2025, we effected another 1-for-10 reverse share split of our authorized and outstanding ordinary shares (with fractional shares being rounded down), (the 2025 Reverse Share Split and, together with the 2023 Reverse Share Split, the Reverse Share Splits ). The conversion prices of outstanding notes, the exercise prices of outstanding warrants and share options and the number of shares issuable upon conversion of restricted share units were adjusted to give effect to the Reverse Share Splits. The Reverse Share Splits were effected to regain compliance with Nasdaq s minimum bid price requirement. Unless otherwise specified, all share amounts, conversion prices and exercise prices reflected in this prospectus give effect to the Reverse Share Splits. Financing Transactions August 2025 Financing On August 27, 2025, we entered into a securities purchase agreement (the August 2025 SPA ) providing for the issuance of subordinated convertible notes (the August 2025 Notes ) to certain accredited investors, including Keystone, in the aggregate original principal amount of up to $20,000,000 to be issued in multiple closings. Closings under the August 2025 SPA can be held over a period of one year at the election of Keystone. At the initial closing, we issued August 2025 Notes in the aggregate original principal amount of $8,640,625 for an aggregate purchase price of $7,718,750 in cash and the exchange of the notes that we issued previously to investors in July 2025. The notes issued in July and August 2025 resulted in aggregate cash proceeds of $4,625,000 and the exchange of notes issued by us in March and April 2025 in the aggregate principal amount of $2,187,500. The August 2025 Notes issued in consideration for cash were issued with a 20% original issue discount, and the August 2025 Notes issued in consideration for our outstanding notes were issued at a 10% discount pursuant to the terms of such notes. The proceeds of the offerings under the August 2025 SPA will be used for general corporate purposes and operating expenses, including the repayment of debt. In particular, we plan to use proceeds of the offering to repay a portion of our loan from Agile Lending LLC (described below under Management Discussion and Analysis of Financial Condition and Results of Operations-HUB Agile Capital Loan ), with the balance of the loan expected to be reinvested in the Company in a subsequent closing under the August 2025 SPA. The August 2025 Notes mature on August 27, 2027, and bear interest at 4% per annum, payable quarterly in ordinary shares under certain equity conditions (including the effectiveness of a resale registration statement) or, at the Company s option, in cash. Late payments accrue interest at an additional premium of 8% per year. No scheduled amortization payments are required. The August 2025 Notes are subordinated to existing senior indebtedness not to exceed $25 million in aggregate. They contain various restrictive covenants, including limitations on dividends, incurrence of indebtedness, certain subsequent equity placements, asset sales and certain variable rate transactions. The August 2025 Notes are convertible into ordinary shares at the option of the holders at an initial conversion price of $2.88 per share, subject to anti-dilution adjustments for certain dilutive issuances. Holders may elect an alternate conversion price at the lower of the fixed conversion price or 95% of lowest VWAP during the five days up to and including the date of conversion, subject to a $1.00 floor price. If such conversion price is lower than the floor price, the Company would be required to pay the balance in cash. 2 The August 2025 Notes contain several mandatory and optional redemption provisions. Holders also have optional redemption rights in respect of financings pursuant to equity lines of credit and at-the-market offerings, allowing them to require redemption of up to their pro-rata portion of 30% of net proceeds from eligible transactions at a 110% of the redemption amount. Holders also have the right to exchange their August 2025 Notes for the securities issued in a subsequent placement, at a 10% discount. The Company has the right to redeem all a portion of the August 2025 Notes, from time to time, at 120% of the conversion amount. In change of control transactions (with control defined based on a 50% threshold), holders may require redemption at 115% of the conversion amount. Holders also have participation rights in future financings, with the right to purchase their pro-rata portion of 30% of any subsequent placement exceeding $5,000,000 in the aggregate. Upon events of default (including registration statement failures, trading suspensions, conversion failures, or material breaches), holders may require redemption at 120% of the conversion amount. Upon any bankruptcy event of default, the Company must immediately pay all outstanding amounts multiplied by a 120% redemption premium without requiring notice or demand from holders. If a Holder converts its Note during an event of default and the prevailing market price at the time of conversion (i.e., the lower of (i) the last closing price and (ii) the average closing price for the last five trading days) is lower than the conversion price then in effect, the conversion price will equal the lower of the conversion price than in effect and 90% of lowest VWAP during the five-days up to and including the date of conversion, subject to a $1.00 floor price. In addition to the August 2025 Notes, at the initial closing under the August 2025 SPA, we issued to the investors warrants to purchase an aggregate of 1,500,108 ordinary shares(the August 2025 Warrants ). The August 2025 Warrants have an initial exercise price of $3.60 per share, subject to decrease on day 30, 60 and 90 following the issuance date to 20% below the prevailing market price at that time and to anti-dilution adjustments for certain dilutive issuances. The August 2025 Warrants have a term of three years. Cashless exercise is permitted after six months if a resale registration statement is not effective. In connection with a fundamental transaction , the holder has the right to exchange its warrant for a similar warrant in the successor entity or cash pursuant to a Black-Scholes formula. Upon an event of default, the holder has the right to redeem its warrant for cash based on a Black-Scholes formula. The August 2025 Notes and the August 2025 Warrants are subject to a beneficial ownership limitation of 4.99% (subject to increase to 9.99% with 61-day notice and shareholder approval) to prevent any holder from exceeding this threshold. We are required reserve 200% of the shares issuable upon conversion of all August 2025 Notes and August 2025 Warrants at the applicable conversion price or exercise price. Concurrently with the entry into the August 2025 SPA, we entered into a registration rights agreement, whereby we undertook to file with the SEC a Form F-1 registration statement within 45 days from the initial closing in order to register for resale the shares issuable upon the conversion and/or exercise of the August 2025 Notes and August 2025 Warrants and the Placement Agent Warrant (as defined below) and to use our reasonable best efforts to cause the registration statement to be effective within 90 days from the initial closing (or 120 days in the event of a full SEC review). The registration rights agreement provides for liquidated damages for certain defaults equal to 1% of the original principal amount of the August 2025 Notes for each 30-day period until the default is cured, up to an aggregate of 10% thereof. The registration rights agreement contains other customary terms and conditions, including indemnification obligations. Rodman & Renshaw LLC acted as sole placement agent for the offering. The fees of the placement agent consisted of a total of $300,000 in cash and the issuance of a warrant to purchase an aggregate of 20,833 ordinary shares on the same terms and conditions as the warrants issued to investors in
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/IMA_imagenebio_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/IMA_imagenebio_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/IMA_imagenebio_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/INR_infinity_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/INR_infinity_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/INR_infinity_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/IPODU_dune_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/IPODU_dune_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..82d1a837d346568efd97f8ef45cdf4d50705a5b4
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/IPODU_dune_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary Our Sponsor for more information. We have until the date that is 15 months from the closing of this offering or until such earlier liquidation date as our board of directors may approve, to consummate our initial business combination. If we anticipate that we may be unable to consummate our initial business combination within such period, we may seek shareholder approval to amend our amended and restated memorandum and articles of association to extend the date by which we must consummate our initial business combination. If we seek shareholder approval for an extension, holders of public shares will be offered an opportunity to redeem their shares, regardless of whether they abstain, vote for, or against, our initial business combination, at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (which interest shall be net of taxes payable), divided by the number of then issued and outstanding public shares, subject to applicable law. If we are unable to complete our initial business combination within 15 months from the closing of this offering, or by such earlier liquidation date as our board of directors may approve, or we do not otherwise seek shareholder approval to amend our amended and restated memorandum and articles of association to further extend the time to complete our business combination, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (which interest shall be net of taxes payable and up to $100,000 of interest to pay dissolution expenses), divided by the number of then issued and outstanding public shares, subject to applicable law and certain conditions as further described herein. See Risk Factors If we are unable to consummate our initial business combination within the completion window, our public shareholders may be forced to wait beyond 15 months before redemption from our trust account. If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association provides that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a group (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 20% of the shares sold in this offering, without our prior consent. Because our sponsor acquired the founder shares at a nominal price of approximately $0.004 per founder share, our public shareholders will incur an immediate and substantial dilution upon the closing of this offering. Further, the Class A ordinary shares issuable in connection with the conversion of the founder shares may result in additional material dilution to our public shareholders due to the anti-dilution rights of our founder shares that may result in an issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion. See the sections titled Risk Factors Risks Relating to our Securities The nominal purchase price paid by our sponsor for the founder shares may result in significant dilution to the implied value of your public shares upon the consummation of our initial business combination , Our initial shareholders paid an aggregate of Table of Contents $25,000, or approximately $0.004 per founder share and, accordingly, you will experience immediate and substantial dilution from the purchase of our Class A ordinary shares , Risks Relating to our Search for, and Consummation of or Inability to Consummate, a Business Combination We may issue additional Class A ordinary shares or preference shares to complete our initial business combination or under an employee incentive plan after completion of our initial business combination. We may also issue Class A ordinary shares upon the conversion of the founder shares at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions contained therein. Any such issuances would dilute the interest of our shareholders and likely present other risks and Unlike some other similarly structured special purpose acquisition companies, our initial shareholders will receive additional Class A ordinary shares if we issue certain shares to consummate an initial business combination in order to provide anti-dilution protection to our initial shareholders . The following table illustrates the difference between the public offering price and our net tangible book value (NTBV), as adjusted to give effect to this offering and to redemptions of our public shares at varying levels, assuming the full exercise and no exercise of the over-allotment option. See the sections titled Prospectus Summary Dilution and Dilution for more information. As of March 31, 2025 Offering Price of $10.00 25% of Maximum Redemption (assumes 3,125,000 or 3,593,750 public shares redeemed) 50% of Maximum Redemption (assumes 6,250,000 or 7,187,500 public shares redeemed) 75% of Maximum Redemption (assumes 9,375,000 or 10,781,250 public shares redeemed) Maximum Redemption (assumes 12,500,000 or 14,375,000 public shares redeemed) NTBV NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price Assuming Full Exercise of Over-Allotment Option $ 6.86 $ 6.27 $ 3.73 $ 5.34 $ 4.66 $ 3.72 $ 6.28 $ 0.09 $ 9.91 Assuming No Exercise of Over-Allotment Option $ 6.86 $ 6.26 $ 3.74 $ 5.34 $ 4.66 $ 3.71 $ 6.29 $ 0.07 $ 9.93 Our sponsor and members of our management team and our independent directors will directly or indirectly own founder shares and/or private placement warrants following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Additionally, each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. See the sections titled Summary Initial Business Combination , The Offering Conflicts of Interest , Risk Factors Risks Relating to our Management Team Our key personnel may negotiate employment or consulting agreements with a target business in connection with a particular business combination, and a particular business combination may be conditioned on the retention or resignation of such key personnel. These agreements may provide for them to receive compensation following our initial business combination and as a result, may cause them to have conflicts of interest in determining whether a particular business combination is the most advantageous , Our officers and directors will allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial business combination , Our officers and directors presently have, and any of them in the future may have additional, fiduciary or contractual obligations to other entities, including other blank check companies, and, accordingly, may have conflicts of interest in allocating their time and in determining to which entity a particular business opportunity should be presented , Our officers, directors, advisors, security holders and their respective affiliates may have Table of Contents competitive pecuniary interests that conflict with our interests , Proposed Business Sourcing of Potential Business Combination Targets , Management Conflicts of Interest , Management Officers, Directors and Director Nominees , and Certain Relationships and Related Party Transactions . The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2025. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Lead Book-Running Manager Clear Street , 2025 Table of Contents TABLE OF CONTENTS Page Summary 1
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+Prospectus Summary 1
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+PROSPECTUS SUMMARY 1 RISK FACTORS 9 ENFORCEABILITY OF CIVIL LIABILITIES 27 USE OF PROCEEDS 28 DIVIDENDS AND DIVIDEND POLICY 29 MANAGEMENT S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 29 HISTORY AND CORPORATE STRUCTURE 66 INDUSTRY OVERVIEW 68 BUSINESS 81 REGULATORY ENVIRONMENT 106 MANAGEMENT 116 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT 127 RELATED PARTY TRANSACTIONS 128 RESALE SHAREHOLDER 129 PLAN OF DISTRIBUTION 130 DESCRIPTION OF SECURITIES 131 CERTAIN CAYMAN ISLANDS COMPANY CONSIDERATIONS 133 SHARES ELIGIBLE FOR FUTURE SALE 138 MATERIAL TAX CONSIDERATIONS 139 LEGAL MATTERS 143 EXPERTS 143 WHERE YOU CAN FIND ADDITIONAL INFORMATION 143 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS 144 i ABOUT THIS PROSPECTUS This prospectus describes the general manner in which the Resale Shareholder may offer from time to time up to 800,000 Ordinary Shares. If necessary, the specific manner in which the Ordinary Shares may be offered and sold will be described in a supplement to this prospectus, which supplement may also add, update or change any of the information contained in this prospectus. To the extent there is a conflict between the information contained in this prospectus and the prospectus supplement, you should rely on the information in the prospectus supplement, provided that if any statement in one of these documents is inconsistent with a statement in another document having a later date-for example, any prospectus supplement-the statement in the document having the later date modifies or supersedes the earlier statement. We have not authorized anyone to provide you with any information or to make any representations other than as contained in this prospectus or in any related free writing prospectus. We take no responsibility for and provide no assurance about the reliability of any information that others may give you. This prospectus is an offer to sell only the Ordinary Shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or any sale of the Ordinary Shares. Our business, financial condition, results of operations and prospects may have changed since that date. For investors outside the United States: Neither we nor the Resale Shareholder has done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction, other than the United States, where action for that purpose is required. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of the Ordinary Shares and the distribution of this prospectus outside the United States. We obtained statistical data, market data and other industry data and forecasts used in this prospectus from market research, publicly available information and industry publications. While we believe that the statistical data, industry data, forecasts and market research are reliable, we do not guarantee the accuracy or completeness of this information and we have not independently verified the data. PRESENTATION OF FINANCIAL INFORMATION Basis of Presentation Unless otherwise indicated, all financial information contained in this prospectus is prepared and presented in accordance with generally accepted accounting principles in the United States of America ( U.S. GAAP or GAAP ). Certain amounts, percentages and other figures included in this prospectus have been subject to rounding adjustments. Accordingly, amounts, percentages and other figures shown as totals in certain tables or charts may not be the arithmetic aggregation of those that precede them, and amounts and figures expressed as percentages in the text may not total 100% or, when aggregated, may not be the arithmetic aggregation of the percentages that precede them. On October 13, 2023, the Company completed a reverse share split that resulted in a reduction of the number of Ordinary Shares outstanding from 15,020,000 to 5,006,666 that has been retroactively restated to the beginning of the first period presented herein. Financial Information in U.S. Dollars Our reporting currency is the Singapore dollar. This prospectus also contains translations of certain foreign currency amounts into U.S. dollars for the convenience of the reader. Unless otherwise stated, all translations of Singapore dollars into U.S. dollars were made at SGD1.00 to US$0.7580 or SGD1.00 to US$0.7379, the exchange rates set forth in the statistical release of the Federal Reserve Board on December 29, 2023 and June 28, 2024, respectively. We make no representation that the Singapore dollar or U.S. dollar amounts referred to in this prospectus could have been or could be converted into U.S. dollars or Singapore dollars, as the case may be, at any particular rate or at all. ii MARKET AND INDUSTRY DATA Certain market data and forecasts used throughout this prospectus were obtained from internal company surveys, market research, consultant surveys, reports of governmental and international agencies and industry publications and surveys. Industry publications and third-party research, surveys and reports generally indicate that their information has been obtained from sources believed to be reliable. This information involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. Our estimates involve
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+Prospectus Summary Founder shares conversion and anti-dilution rights. If we raise additional funds through equity or convertible debt issuances, our public shareholders may suffer significant dilution. This dilution would increase to the extent that the anti-dilution provision of the founder shares result in the issuance of Class A ordinary shares on a greater than one-for-one basis upon conversion of the founder shares at the time of our initial business combination. 8 Table of Contents Pursuant to a letter agreement to be entered with us, each of our sponsor, directors and officers has agreed to restrictions on its ability to transfer, assign, or sell the founder shares and private placement units, as summarized in the table below. Subject Securities Expiration Date Natural Persons and Entities Subject to Restrictions Exceptions to Transfer Restrictions Founder shares The earlier of (A) one year after the completion of our initial business combination or earlier if, subsequent to our initial business combination, the closing price of the Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination and (B) the date following the completion of our initial business combination on which we complete a liquidation, merger, share exchange or other similar transaction that results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property. K&F Growth Acquisition LLC II Edward King Daniel Fetters James Murren Joyce Arpin Geoff Freeman Transfers permitted (a) to our officers, directors, advisors or consultants, any affiliate or family member of any of our officers, directors, advisors or consultants, any members or partners of the sponsor or their affiliates and funds and accounts advised by such members or partners, any affiliates of the sponsor, or any employees of such affiliates; (b) in the case of an individual, as a gift to such person s immediate family or to a trust, the beneficiary of which is a member of such person s immediate family, an affiliate of such person or to a charitable organization; (c) in the case of an individual, by virtue of laws of descent and distribution upon death of such person; (d) in the case of an individual, pursuant to a qualified domestic relations order; (e) by private sales or transfers made in connection with any forward purchase agreement or similar arrangement, in connection with an extension of the completion window or in connection with the consummation of a business combination at prices no greater than the price at which the shares or Share Rights were originally purchased; (f) pro rata distributions from our sponsor to its respective members, partners or shareholders pursuant to our sponsor s limited liability company agreement or other charter documents; (g) by virtue of the laws of the Cayman Islands or our sponsor s limited liability company agreement upon dissolution of our sponsor; (h) in the event of our liquidation prior to our consummation of our initial business combination; (i) in the event that, subsequent to our consummation of an initial business combination, we complete a liquidation, merger, share exchange or other similar transaction which results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities 9 Table of Contents Subject Securities Expiration Date Natural Persons and Entities Subject to Restrictions Exceptions to Transfer Restrictions or other property; or (j) to a nominee or custodian of a person or entity to whom a transfer would be permissible under clauses (a) through (g); provided, however, that in the case of clauses (a) through (g) and clause (j) these permitted transferees must enter into a written agreement agreeing to be bound by these transfer restrictions and the other restrictions contained in the letter agreement. Private placement units (including underlying securities) 30 days after the completion of our initial business combination K&F Growth Acquisition LLC II Edward King Daniel Fetters Same as above, except BTIG shall also be permitted to make the same type of transfers to their affiliates as the sponsor can make to its affiliates as described above. Any units, Share Rights, ordinary shares or any other securities convertible into, or exercisable or exchangeable for, any units, ordinary shares, founder shares or rights 180 days from the date of this prospectus K&F Growth Acquisition LLC II Edward King Daniel Fetters James Murren Joyce Arpin Geoff Freeman We, our sponsor and our officers and directors have agreed that, for a period of 180 days from the date of this prospectus, we and they will not, without the prior written consent of the representative of the underwriters, offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, any units, Share Rights, shares or any other securities convertible into, or exercisable, or exchangeable for, shares, subject to certain exceptions. The representative in its sole discretion may release any of the securities subject to these lock-up agreements at any time without notice, other than in the case of the officers and directors, which shall be with notice. Our sponsor, officers and directors are also subject to separate transfer restrictions on their founder shares and private placement units pursuant to the letter agreement described in the immediately preceding paragraphs. Up to 1,250,000 of the founder shares will be surrendered for no consideration depending on the extent to which the underwriters over-allotment option is exercised. In addition, in order to facilitate our initial business combination as determined by our sponsor in its sole discretion, our sponsor may surrender or forfeit, transfer or exchange our founder shares, private placement units or any of our other securities, including for no consideration, as well as subject any such securities to earn-outs or other restrictions, or otherwise amend the terms of any such securities or enter into any other arrangements with respect to any such securities. We may also issue Class A ordinary shares upon conversion of the Class B ordinary shares at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions as set forth therein. Pursuant to the letter agreement to be entered with us, each of our sponsor, directors and officers have agreed to a lock-up and restrictions on their ability to transfer, assign, or sell the founder shares and private placement units and securities underlying the private placement units. Further, the sponsor membership interests (including the interests held by the non-managing members) are locked up and not transferable because the letter agreement prohibits indirect transfers. 10 Table of Contents Our letter agreement may be amended without shareholder approval. Such transfer restrictions have been amended in connection with business combinations for certain other special purpose acquisition companies. While we do not expect our board to approve any amendment to the letter agreement prior to our initial business combination, it may be possible that our board, in exercising its business judgment and subject to its fiduciary duties, chooses to approve one or more amendments to the letter agreement. While non-managing members will not be a direct party to the letter agreement discussed, as a result of their ownership of membership interests in the sponsor, they will be bound by the restrictions set forth above with respect to their allocated founder shares, the private placement units and securities underlying the private placement units (including the restriction on transfer of their membership interests because the letter agreement prohibits indirect transfers). However, the non-managing sponsor investors will not be subject to transfer restrictions or a lock-up agreement on any public units, public Class A ordinary shares or Right Shares that they may purchase in this offering or thereafter pursuant to the expressions of interest described below. See Principal Shareholders Restrictions on Transfers of Founder Shares and Private Placement Units. Business Strategy Our acquisition and value creation strategy is to identify, acquire and, after our initial business combination, build a company in the public markets. We believe our complementary team provides us a distinct advantage to identify a leading experiential entertainment company and execute a successful business combination. Extensive Direct Domain Expertise as Leaders, Operators, Investors, Financiers and Advisors. Our management and our board members have dedicated their careers to industries that provide consumers leading entertainment experiences. They have consistently demonstrated an ability to operate, build, lead, invest in, acquire, finance and advise leading entertainment businesses that engage consumers in memorable ways. Throughout their careers, they have helped shape prominent entertainment industries such as live entertainment, casinos, destination hospitality, sports, and mobile gaming by leading their respective companies, investing in or advising the boards and management teams of companies across the industry and engaging in transformative transactions. We believe we can serve as a highly valued resource to and can work effectively with the management team of our business combination partner and provide them with significant competitive insights and help create enduring shareholder value. Expansive Network of Relationships Built Over Decades. Our management and Board of Directors have spent most of their careers operating in the industries we are targeting, developing expansive networks of founders, owners and management teams of private companies, entrepreneurs, public company senior executives, boards, investors, private equity sponsors, and advisors (investment banks, consultants, attorneys and accountants). We believe this breadth of access will allow us to both source and create acquisition opportunities simply not available to others, due to the trust, reputation, creativity and experience of our team. Resolute Focus on Value Creation. Our team has deep experience in investing and creating value through pursuing operational improvements, repositioning and realigning strategies, optimizing capital structures, overseeing capital allocation policies, acquiring and separating businesses and identifying future growth opportunities. Each member of our team has relentlessly pursued value maximizing initiatives and developed impressive track records over the long term. Importantly, we have substantial experience in executing transactions throughout market cycles and structuring transactions to minimize risk while preserving upside opportunity. Expertise Advising and Steering Private Companies into the Public Markets. As we pursue a business combination, we intend to work alongside management and their shareholders to unlock the potential of a company s upside as it transitions from a private company to a public company. We expect that our expertise will be invaluable to management teams in accessing the capital markets and driving value for shareholders long term. Vast Experience Structuring, Negotiating, and Executing Mergers and Acquisitions. We expect that value creation in the public markets from the initial business combination will be achieved by our intended upfront implementation of rigorous discipline and creativity to the valuation, terms and conditions of the merger transaction to ensure alignment of economic incentives and creation of an attractive investment thesis. Our team has decades of experience performing rigorous due diligence, structuring, negotiating and executing transactions across private and public companies, corporate carve-outs, and private equity-backed exits. Members of our management team and Board of Directors also have experience in founding a special purpose acquisition company and successfully completing an initial business combination. 11 Table of Contents Breadth of Relationships Across Equity and Debt Capital Providers to Attract Permanent Capital. Our management and board members have decades of experience fostering trusted relationships with top tier sources of institutional and strategic equity capital and industry-specialized credit investors and lending banks. Our collective experience leading the dialogue with public and private investors has positioned us uniquely to not only attract the permanent capital with which we intend to optimize the capital structure of our business combination target, but to leverage our investor relations expertise and Wall Street research analyst relationships to successfully position the public story of our business combination partner. Business Combination Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective target businesses. We will use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target business that does not meet some or all of these criteria and guidelines. Greater than $1 billion target equity value: We intend to target companies whose equity valuation is greater than $1.0 billion, determined in the sole discretion of our management team according to reasonable accepted valuation standards and methodologies. Companies of this size tend to have a well-developed, enduring revenue, generate strong, sustainable cash flow and have opportunities for accelerated growth. We believe companies of this size offer the potential for compelling long-term shareholder return. Highly defensible business models with a sustainable competitive advantage. A tailored, highly differentiated, or unique consumer experience that builds on a sense of wonder, community and shared values engenders enduring consumer loyalty and repeat customer demand. It is our belief these attributes create the most defensible business models, sustain a competitive advantage and market position and create attractive growth and cash flow profiles, and so generate shareholder value. Disruptive business models with strong secular growth. We believe that many categories are experiencing growth due to strong underlying consumer demand and, in the case of regulated gaming, liberalizing regulations. These companies rapid growth and potential, and prospective scale, lead them to be natural public entities, whereon new avenues of growth and capital can be opened to fund organic initiatives and pursue transformative or bolt-on acquisitions. Strong management that would benefit from our extensive and diverse expertise. We aim to target a business with a professional management team who have a demonstrable track record of success and whose interests are aligned with those of our investors. We believe our operating expertise and expansive network access has the potential to drive incremental value to even strong management teams, resulting in improvements to operational and financial performance. Founder-owner monetization, corporate carve-outs and private equity exits. Special purpose acquisition company transactions are a proven path for owners to monetize their holdings through an upfront liquidity event with ongoing participation, and present many compelling features not otherwise replicable in an IPO or sale. We will target businesses with an easily understood public narrative and will focus on companies that have a reason to pursue a public listing, including more efficient access to debt and equity capital, attracting and retaining talent, ability to use equity as a form of consideration in high return, strategic acquisitions and increased opportunity for branding and market positioning. These criteria and guidelines are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general criteria and guidelines as well as other considerations, factors, criteria and guidelines that our management may deem relevant. These criteria are substantially similar to the criteria set forth by Acies I for its initial business combination. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria and guidelines in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of tender offer documents or proxy solicitation materials that we would file with the SEC. 12 Table of Contents Potential Additional Financings We may need to obtain additional financing to complete our initial business combination, either because the transaction requires more cash than is available from the proceeds held in our trust account or because we become obligated to redeem a significant number of our public shares upon completion of the business combination, in which case we may issue additional securities or incur debt in connection with such business combination. If we raise additional funds through equity or convertible debt issuances, our public shareholders may suffer significant dilution and these securities could have rights that rank senior to our public shares. If we raise additional funds through the incurrence of indebtedness, such indebtedness would have rights that are senior to our equity securities and could contain covenants that restrict our operations. Further, as described above, due to the anti-dilution rights of our founder shares, our public shareholders may incur material dilution. In addition, we intend to target businesses with enterprise values that are greater than we could acquire with the net proceeds of this offering and the sale of the private placement units, and, as a result, if the cash portion of the purchase price exceeds the amount available from the trust account, net of amounts needed to satisfy any redemptions by public shareholders, we may be required to seek additional financing to complete such proposed initial business combination. We may also obtain financing prior to the closing of our initial business combination to fund our working capital needs and transaction costs in connection with our search for and completion of our initial business combination. There is no limitation on our ability to raise funds through the issuance of equity or equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements or backstop agreements we may enter into following consummation of this offering. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our initial business combination. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to liquidate the trust account. In addition, following our initial business combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations. See Proposed Business Potential Additional Financing. Our Business Combination Process In evaluating a prospective target business, we expect to conduct an extensive due diligence review which may encompass, as applicable and among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities and a review of financial and other information about the target and its industry. We will also utilize our management team s operational and capital planning experience. Each of our directors and officers will, directly or indirectly, own founder shares and/or private placement units following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, such officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Certain of our officers and directors presently have, and any of them in the future may have additional, fiduciary or contractual obligations to other entities, pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity subject to his or her fiduciary duties. As a result, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, then, subject to such officer s and director s fiduciary duties under Cayman Islands law, he or she will need to honor such fiduciary or contractual obligations to present such business combination opportunity to such entity, before we can pursue such opportunity. If these other entities decide to pursue any such opportunity, we may be precluded from pursuing the same. However, we do not expect these duties to materially affect our ability to complete our initial business combination. Our amended and restated memorandum and articles of association will provide that to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and us, on the other. 13 Table of Contents Initial Business Combination We are not presently engaged in, and we will not engage in, any operations for an indefinite period of time following this offering. We intend to effectuate our initial business combination using cash from the proceeds of this offering and the private placement of the private placement units, the proceeds of the sale of our shares in connection with our initial business combination (including pursuant to forward purchase agreements or backstop agreements we may enter into following the consummation of this offering or otherwise), shares issued to the owners of the target, debt issued to bank or other lenders or the owners of the target, other securities issuances, or a combination of the foregoing. We may seek to complete our initial business combination with a company or business in its early stages of development or growth, which would subject us to the numerous risks inherent in such companies and businesses. We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination either (i) in connection with a general meeting called to approve the business combination or (ii) without a shareholder vote by means of a tender offer. If we seek shareholder approval, we will complete our initial business combination only if we receive an ordinary resolution under Cayman Islands law and our amended and restated memorandum and articles of association, which requires the affirmative vote of at least a majority of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at the applicable general meeting of the company. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under applicable law or stock exchange listing requirement. We will have up to 21 months from the closing of this offering to consummate an initial business combination, or until such earlier liquidation date as our board of directors may approve, to consummate our initial business combination. If we anticipate that we may be unable to consummate our initial business combination within such 21-month period, we may seek shareholder approval to amend our amended and restated memorandum and articles of association to further extend the date by which we must consummate our initial business combination. If we seek shareholder approval for an extension, holders of public shares will be offered an opportunity to redeem their shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (less income taxes, if any), divided by the number of then issued and outstanding public shares, subject to applicable law. If we are unable to complete our initial business combination within the completion window and do not hold a shareholder vote to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to consummate an initial business combination,, or by such earlier liquidation date as our board of directors may approve, from the closing of this offering, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (less income taxes, if any, payable and up to $100,000 of interest income to pay dissolution expenses), divided by the number of then issued and outstanding public shares, subject to applicable law and certain conditions as further described herein. We expect the pro rata redemption price to be approximately $10.05 per public share (regardless of whether or not the underwriters exercise their over-allotment option), without taking into account any interest or other income earned on such funds. However, we cannot assure you that we will in fact be able to distribute such amounts as a result of claims of creditors, which may take priority over the claims of our public shareholders. If we do not complete our initial business combination within the completion window, while we do not currently intend to seek shareholder approval to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to consummate an initial business combination, we may elect to do so in the future. There is no limit on the number of extensions that we may seek; however, we do not expect to extend the time period to consummate our initial business combination beyond 36 months from the closing of this offering. If we determine not to or are unable to extend the time period to consummate our initial business combination or fail to obtain shareholder approval to extend the completion window, our sponsor s investment in our founder shares and our private placement units will be worthless. Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the deferred underwriting commissions and taxes payable on the interest earned on the trust account). Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the 14 Table of Contents satisfaction of such criteria. While we consider it likely that our board of directors will be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of the target s assets or prospects. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination so that the post-transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post-transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test described above. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors, non-managing sponsor investors, or completing the business combination through a joint venture or other form of shared ownership with our sponsor, officers or directors or non-managing sponsor investors. In the event we seek to complete our initial business combination with a company that is affiliated (as defined in our amended and restated memorandum and articles of association) with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions, stating that the consideration to be paid by us in such an initial business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other context. Members of our management team and our independent directors will directly or indirectly own founder shares and/or private placement units following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. The low price that our sponsor, executive officers and directors (directly or indirectly) paid for the founder shares creates an incentive whereby our officers and directors could potentially make a substantial profit even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. If we are unable to complete our initial business combination within the completion window, or by such earlier liquidation date as our board of directors may approve, the founder shares and the private placement units (and the securities comprising such units) may expire worthless, except to the extent they receive liquidating distributions from assets outside the trust account, which could create an incentive for our sponsor, executive officers and directors to complete a transaction even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such other entity, subject to their fiduciary duties under Cayman 15 Table of Contents Islands law. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by law: (i) no individual serving as a director or an officer, among other persons, shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us, and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which (a) may be a corporate opportunity for any director or officer, on the one hand, and us, on the other or (b) the presentation of which would breach an existing legal obligation of a director or officer to any other entity. As a result, the fiduciary duties or contractual obligations of our officers or directors could materially affect our ability to complete our initial business combination. In addition, our sponsor and our officers and directors may sponsor or form other special purpose acquisition companies similar to ours or may pursue other business or investment ventures during the period in which we are seeking an initial business combination. As a result, our sponsor, officers and directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other special purpose acquisition company with which they may become involved. Any such companies, businesses or investments may present additional conflicts of interest in pursuing an initial business combination target. As a result, any such potential conflicts could materially affect our ability to complete our initial business combination. Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. Corporate Information Our executive offices are located at 1219 Morningside Drive, Suite 110, Manhattan Beach, California 90266, and our telephone number is (310) 545-9265. We are a Cayman Islands exempted company. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (Revised) of the Cayman Islands, for a period of 30 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividend or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. 16 Table of Contents We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that are held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates is equal to or exceeds $250 million as of the prior June 30, or (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates is equal to or exceeds $700 million as of the prior June 30. Finally, after completion of this offering and prior to the consummation of a business combination, only holders of our Class B ordinary shares will have the right to vote on the appointment or removal of directors. As a result, Nasdaq will consider us to be a controlled company within the meaning of Nasdaq corporate governance standards. Under Nasdaq corporate governance standards, a company of which more than 50% of the voting power for the appointment of directors is held by an individual, group or another company is a controlled company and may elect not to comply with certain corporate governance requirements. We currently do not intend to rely on the controlled company exemption, but may do so in the future. Accordingly, if we choose to do so, you will not have the same protections afforded to shareholders of companies that are subject to all of the Nasdaq corporate governance requirements. 17 Table of Contents
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+PROSPECTUS SUMMARY This summary highlights selected information that is presented in greater detail elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our ordinary shares. You should read this entire prospectus carefully, including the sections titled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations and our consolidated financial statements and notes thereto included elsewhere in this prospectus, before deciding to invest in our ordinary shares. Overview Our Mission and Vision Our mission is to reimagine how consumers spend and save in their daily lives. We help people save time, money and put them in control of their finances. Our vision is a world where Klarna empowers everyone, everywhere, through seamless commerce experiences as a personalized, trusted assistant making financial empowerment effortless. Our Company We are a technology company building the next-generation commerce network. We have built one of the largest commerce networks in the world, measured by the number of consumers and merchants, serving approximately 111 million active Klarna consumers and approximately 790,000 merchants in 26 countries as of June 30, 2025, and facilitating $112 billion of GMV in the last twelve months ended June 30, 2025. Our flexible and personalized products, trusted consumer brand, global distribution and proprietary scalable infrastructure are the foundations enabling us to become our consumers everyday spending and saving partner, available everywhere and for everything. Through our history, we have consistently innovated and challenged the status quo, evolving our network from a consumer-focused payments tool to a global commerce network that enables merchant success. Klarna was built to address the manifold pain points in commerce today, including inefficiency, lack of trust, prevalence of fraud, impersonal relationships between consumers and merchants and high interest and credit-related fees that are harmful to consumers, merchants and society at large. We began by pioneering a new approach to online payments, designed to bridge uncertainty in the transactions between consumers and merchants by providing short-term flexible credit that is predominantly interest-free and accelerating growth for merchants. Our approach leverages differentiated underwriting capabilities, utilizes bank deposits and other low-cost funding sources and is monetized primarily by driving increased GMV for merchants on our network rather than from only charging interest to consumers. In the last twelve months ended June 30, 2025, 98% of transactions conducted on our network were interest-free. This results in lower fees, which we believe drives consumers and, in turn, our merchants, to shift more of their commerce activity onto our network, aligning the financial success of our consumers and merchants with our long-term ambition of durable growth. We have also built a unique advertising solution, connecting engaged consumers to advertisers in a personalized, commerce-centric environment. Consumers come to Klarna to pay flexibly and securely, to find goods, services and experiences that are relevant to them, and to manage their purchases and savings, all in a trusted environment. We designed our network to provide consumers with more control and flexibility over their payments, to save them time and money and to effortlessly put them in control of their finances. This allows us to become an important growth partner for merchants of all sizes, enabling them to grow their businesses and acquire new customers, convert more transactions with higher AOVs and retain customers with increased loyalty, all while establishing and fostering personal relationships with their customers. Just as card networks revolutionized the way merchants and consumers received and made payments decades ago, we have created a new type of network built upon fairness, sustainability and innovation, while removing intermediaries, complexity and fees along the way. We accelerate commerce by connecting consumers and merchants with comprehensive payment and tailored advertising solutions, both online and offline. Our payment options provide consumers with the choice to pay however they prefer Pay in Full settles transactions instantly, Pay Later allows consumers to complete a purchase today while deferring payment to a later date or into installments and Fair Financing allows consumers to settle payments over a longer period of time. We offer the benefits of both open and closed networks. We open our network to a broad consumer and merchant ecosystem, similar to Visa, MasterCard and Amex, but also benefit from our proprietary closed-loop network where we issue, fund, process and settle the entire payment, while retaining a direct relationship with our consumers. Payment options are facilitated across numerous channels, including directly at our merchants online or in-store checkouts, in the Klarna app, with the Klarna card or using Apple Pay or Google Pay. We have achieved global consumer and merchant scale. Our 111 million active Klarna consumers are diverse from a wide range of income levels and educational backgrounds and representative of the broader population. In Sweden, our most mature market, approximately 83% of adults were active Klarna consumers as of June 30, 2025, according to our estimates. Our consumers are financially responsible, too in the last twelve months ended June 30, 2025, 99% of the consumer loans that we extended were paid on time. Merchants view Klarna as an important growth partner because of our consumer scale and global reach. Our approximately 790,000 merchants include some of the largest global brands on average, 48% of the top 100 merchants in each of the major markets we serve, which include the United States, the U.K., the Nordics, Germany, Austria, Belgium, Spain, France, Italy, the Netherlands and Switzerland (based on data from eCommDB and Digital Commerce 360) used Klarna in the last twelve months ended July 31, 2025 to facilitate payments, while an even greater percentage (66%) advertised on our network during the same period. Our broad adoption across merchants contributes to our GMV diversification, with no single merchant representing more than 10% of our GMV in any of our major markets in the last twelve months ended June 30, 2025. Through both our payment and advertising solutions, we help our merchants attract new customers, drive higher AOV with higher purchase frequency and offer frictionless commerce and higher conversion rates. We do all of this while allowing merchants to seamlessly integrate Klarna into their existing operations and infrastructure, retaining full control over their brands. Klarna sits at the center of a global ecosystem. We connect an array of different financial services and commerce organizations, from PSPs, traditional banks, card networks and open banking providers, to commerce enablers, technology partners, in-store payments providers and shipping and return logistics providers, to improve the commerce experience for our consumers and merchants through a unique global network. We continue to grow our network across verticals and geographies to better serve consumers and merchants. We believe that our credit underwriting capabilities, enabled by our proprietary data from approximately 3.0 million transactions made on average per day on our network from 111 million active Klarna consumers in the last twelve months ended June 30, 2025, differentiate us from other networks. We are able to make underwriting decisions in seconds with our fully automated processes and underwrite every transaction in real time. We also provide a small spending capacity that gradually increases as consumers responsibly spend more with Klarna, and clear and transparent repayment terms that encourage borrowers to repay on time. All of this distinguishes our financing solutions from market alternatives. In the last twelve months ended June 30, 2025, our average balance per active Klarna consumer was $80 (Pay in Full $0 Pay Later $88 Fair Financing $408) (compared to an average balance per credit card of approximately $6,730 in the United States in 2024, according to Experian), and average loan duration was approximately 40 days (38 days for Pay Later and 180 days for Fair Financing) (compared to a typical loan duration of more than five years at a typical Nordic bank in 2024, according to publicly available information, and an average of 2.9 years of a typical U.S. personal bank loan in 2022, according to the U.S. Federal Reserve). This allows us to quickly react to market changes and efficiently manage credit risk. Our underwriting process results in credit losses that are generally lower than the industry average for example, our provision for credit losses represented 0.52% of GMV in the last twelve months ended June 30, 2025, while the loan losses as a share of total loans averaged 2.6% for our main competitors in Sweden in 2024, based on publicly available information of Swedish banks and payment solutions providers, and 2.92% for commercial banks in the United States in 2024, according to the Federal Reserve Bank of St. Louis. In addition to lower credit losses, we believe that our underwriting process provides more value to consumers and merchants than alternative payment methods, which helps drive our financial performance. We have been a constant pioneer in our industry. In 2005, when online shopping was still nascent and marked by distrust, we launched Pay Later products to guarantee consumers would pay only after they had received goods, while also pioneering a new approach to credit. In 2010, we launched our Pay in Full product to give consumers more choice and control over how they pay. In 2017, we started building a disruptive brand to help people streamline their financial lives. As we learned that consumers wanted to use Klarna everywhere, we launched the Klarna card in 2018. That same year, we launched the Klarna app, which enables our consumers to track all their purchases in one place, track their shipments, assist with errands and much more. While we began with payments innovation, in 2019, we started to meaningfully scale our advertising solutions, which personalize the commerce experience for our consumers by using our vast proprietary data set, including data they entrust to us. In 2023, we developed an AI assistant powered by OpenAI, which meaningfully streamlines the commerce experience, and in 2024, introduced Klarna balance, which makes commerce even more effortless by allowing consumers to Pay in Full or Pay Later without connecting to a bank account or card. In 2025, we continued to expand and introduce more digital finance products to help our consumers save time and money and effortlessly put them in control of their finances. For example, we enhanced the Klarna card with real-time transfer and deposit features to create smarter wallet features, and we have begun its roll-out in the United States. This upgrade builds on the success of Klarna balance and our savings accounts, underscoring our growing role in everyday financial management. At the same time, we continued reshaping access to credit through the expansion of our Fair Financing offering a transparent, non-revolving alternative to traditional credit now available at a broader merchant network, including major partners like Walmart. These innovations are all built on our AI-enabled, cloud-native and global technology platform to which merchants can connect via a single API. Every product we bring to market can be launched globally, allowing merchants to reach millions of consumers worldwide almost instantly once connected to our network. We began operations in Sweden in 2005, and rapidly expanded through the rest of the Nordics. By 2010, we operated in the Nordics, Germany and the Netherlands. By 2016, we were established in nine markets, including Austria (2012), Switzerland (2014) and the U.K. (2014). Since inception, we have strived to maintain a deliberate balance of growth and profitability. We remained profitable for the first 14 years as we scaled our operations in Europe. In 2019, we strategically decided to expand our successful operating model into additional geographies, with a particular focus on the United States, and in the following three years expanded into 12 additional markets. While our expansion in the United States has contributed to an increase in our GMV, it has also led to net losses in recent periods. In 2023, our operating loss started to decline and we began generating positive transaction margin dollars in the United States, while continuing to grow our GMV and the number of active Klarna consumers and merchants worldwide. For two decades, Klarna has been transforming the commerce landscape. Our growth strategy is an extension of our ability to innovate and cater to our customers needs Klarna at Every Checkout. We have a proven track record of bringing global leading merchants to our network, which have been key in amplifying our brand s reach. We also have a unique go-to-market strategy by partnering with several of the world s largest PSPs, including Worldpay, Stripe and Adyen, we can connect with consumers through hundreds of thousands of merchant checkouts. By integrating Klarna with Apple Pay and Google Pay, our consumers can use Klarna s payment solutions wherever Apple Pay or Google Pay is available online in the United States as well as, in the case of Apple Pay, in the U.K., without having the Klarna card. Increasing the availability of our payment methods is imperative to further growth of our network, as a higher penetration of merchants directly translates to a higher share of checkout. Klarna Card in Every Wallet. We envision Klarna becoming the default payment method for our millions of active Klarna consumers and future consumers. With the Klarna card, we are making it easier for consumers to enjoy our popular flexible payment options, both online and offline. Next-Generation Digital Financial Services. As a digital-first neobank, Klarna s services are automated, insight-driven and designed to be transparent, fair and intuitive. We partner with PSPs, traditional banks, card networks, commerce enablers, technology partners, merchants and shipping and return logistics providers to improve the commerce experience for our consumers. This breadth of our ecosystem, coupled with our extensive portfolio of licenses and regulatory authorizations, allows us to provide consumer services that others cannot, such as instant refunds, cashback, real-time debit or order and return tracking. These features save consumers time and money and effortlessly put them in control of their finances. Klarna s Personal Shopping and Money Assistant. Through a true understanding of our consumers needs, we are uniquely positioned to offer them curated shopping assistance and related products that are truly valuable and relevant to them. Consumers gain access to premium features through subscription services, enhancing their lifestyle while enjoying convenience and savings. Within the Klarna app, they can spend, save and shop smarter with the power of an AI assistant designed to understand personal needs and preferences. From product recommendations to managing expenses, this smart companion is here to guide the consumer throughout the entire commerce journey. This, we believe, will redefine how consumers interact and engage with Klarna, creating a deep and sticky customer relationship. AI-Powered Efficiency. AI allows us to drive scale efficiencies greater than what was previously thought possible, allowing our deep talent pool to focus on innovation and growth. We enjoy several key competitive advantages that have enabled our continued success since our founding in 2005 Compounding Network Effects. Our personalized, highly engaging consumer experiences drive consumers to our network. As more consumers engage at scale, more merchants join our network and grow their businesses. As more merchants join the network, consumers benefit from increased selection across verticals, channels and geographies, and can purchase more frequently using, and demonstrate preference for, our network. Trusted Brand, Global Distribution. We have built a brand that is distinctly global, universally recognized and well-loved by consumers and merchants, an accomplishment that we believe is rare among businesses that provide payments and financial services. Industry-Leading AI Adoption and Implementation. Klarna has been an early and leading adopter of AI. Our network and AI capabilities are powered by a unique proprietary data set, built on SKU-level data points, including over 2.5 billion data points collected in 2024, and more than 5.7 billion transactions conducted through our network since our founding. Scalable Technology Platform. Our network is powered by a single, AI-enabled cloud-native technology platform that facilitates connections across the global ecosystem. Businesses ranging from PSPs, traditional banks, card networks and open banking providers to commerce enablers, technology partners, in-store payment providers and shipping and return logistics providers join our network through a single shared API to enable fast and global connectivity nearly instantly. Diversified and Sustainable Business Model. Our diversified revenue model, based primarily on merchant fees, aligns the interests of merchants, consumers and our business. The proportion of our revenue generated from merchants, consumers and advertising is generally more balanced compared to many of our competitors in the payments and the banking industries, who tend to depend more heavily than we do on either merchant revenue or interest income. Our banking license enables us to maintain a low-cost, stable funding model based on consumer deposits. We currently offer savings accounts directly to residents of Austria, Belgium, Denmark, Finland, France, Germany, Ireland, Italy, the Netherlands, Norway, Poland, Portugal, Spain and Sweden. We are also able to collect deposits in Germany, the Netherlands, France, Spain and Ireland pursuant to a partnership with a third-party deposit-taking platform operated by Raisin. Our banking pedigree adds rigor to our underwriting processes, which are designed to continuously improve our credit decisioning and monitoring. Durable Growth Profile, with Scale Efficiencies. Our network connects millions of consumers and hundreds of thousands of merchants at scale to power global commerce. Our scale enables our efficient growth. More consumers attract more merchants to our network, which, in turn, attract more consumers. As we have scaled our operations over the last 20 years, we have optimized our cost structure and driven meaningful operating leverage in the business. For example, from 2022 to the last twelve months ended June 30, 2025, our operating loss improved by 77% while our transaction margin dollars increased by 77% and operating margin by 44 percentage points in that period. Thanks to these competitive advantages, we believe we have a substantial opportunity to increase our market share across channels, geographies and verticals. Annual consumer retail and travel spending in the markets in which we currently operate is estimated to be $19 trillion for the last twelve months ended June 30, 2025, of which $9 trillion was in the United States, based on the Market Opportunity Study. We consider our serviceable addressable market ( SAM ) to be the approximately $520 billion payments revenue opportunity associated with that spend, based on our average take rate in the last twelve months ended June 30, 2025. The global retail and travel spending across all markets (excluding China) is estimated to reach $35 trillion in 2027, based on the Market Opportunity Study. We have the opportunity to expand into new markets, to reach further into that spend opportunity. We have also scaled our advertising revenue from approximately $13 million in 2020 to $184 million in the last twelve months ended June 30, 2025. Digital advertising represents an additional approximately $570 billion market opportunity globally (excluding China) as of June 30, 2025 (based on the Market Opportunity Study) that we believe we are uniquely positioned to address given our unique data from intent-driven consumers. Additionally, we are well positioned to build a leading presence in strategic adjacencies such as retail banking services, given our trusted relationships with consumers, our experience and our existing banking services in select regions, where we held $14 billion of consumer funds as of June 30, 2025. We continuously strive to develop innovative products and solutions for our consumers and merchants to continue to grow our addressable markets. These network effects power our robust and compounding financial model characterized by long-term growth and expanding margin profile. For example, in the last twelve months ended June 30, 2025, our GMV was $112 billion, representing 13% (or 15% on a like-for-like basis) year-over-year growth and our total revenue was $3,010 million, representing 17% year-over-year growth (19% on a like-for-like basis). Our operating loss was $225 million and adjusted operating profit was $151 million, representing a 29% decrease and 148% improvement year over year, respectively. Our transaction margin dollars equaled $1,219 million in the last twelve months ended June 30, 2025, representing 2% year-over-year growth (7% on a like-for-like basis). Our net loss in the last twelve months ended June 30, 2025 was $100 million, a 29% year-over-year improvement. The Klarna Network Over the past 20 years, we have built the next-generation commerce network that connects consumers and merchants globally. Our Network Efficiently Connects Consumers and Merchants We enable next-generation payments through direct relationships between consumers and merchants. Through our network, consumers can find and pay for goods, services and experiences in a highly efficient and flexible manner, and merchants are connected with more and more empowered consumers. We have built our network to directly connect consumers and merchants, removing reliance on card networks or issuing banks, which provides us with better data and a cost advantage compared to traditional providers. Consumers and merchants entrust us directly with their data. We use this data, including more than 2.5 billion SKU-level data points collected in 2024, to better understand consumer preferences, more accurately underwrite consumer credit, provide clearer indications of consumer purchasing power and help merchants build trusted, brand-aligned relationships. We are able to provide our consumers and merchants key insights and services, in addition to payment processing, to facilitate more efficient commerce experiences. Our network also removes middlemen from a typical transaction, resulting in lower fees for both consumers and merchants. We open our network to a broad consumer and merchant ecosystem, similar to Visa, MasterCard and Amex, but also benefit from our proprietary closed-loop network where we issue, fund, process and settle the entire payment, while retaining a direct relationship with our consumers. Our Network Sits at the Center of a Global Ecosystem We partner with a range of global constituents that facilitate commerce to make our network more ubiquitous and efficient for our consumers and merchants. Our network integrates with PSPs, who help grow our merchant presence, and traditional banks, card networks and open banking providers, who help facilitate payments. We also partner with commerce enablers (i.e., companies that offer end-to-end services to help businesses operate their stores) and technology partners to provide merchants holistic commerce solutions, in-store payments providers to facilitate offline transactions and shipping and return logistics providers who help our consumers manage purchases. By integrating Klarna with Apple Pay and Google Pay, our consumers can use Klarna s payment solutions wherever Apple Pay or Google Pay is available online in the United States as well as, in the case of Apple Pay, in the U.K., without having the Klarna card. We allow hundreds of partner companies to integrate into our open network, which improves the value proposition we provide our consumers and merchants by making Klarna available at more checkout points. The Scale of Our Network Makes Klarna a Critical Growth Partner for Merchants and the Preferred Commerce Network for Consumers With 111 million active Klarna consumers distributed globally as of June 30, 2025, Klarna provides merchants with an extensive network and solutions for customer acquisition and loyalty, driving higher conversion and AOV as well as improved retention. We believe that merchants and other payment ecosystem participants recognize the value that we bring through the scale and reach of our network and see us as a critical growth partner. Merchants have the opportunity to benefit from our network across the globe. Similarly, consumers enjoy the benefits of searching, discovering and paying by Klarna, across our approximately 790,000 merchants as of June 30, 2025, knowing they will have a positive consumer experience with our network s abundance of choice, price comparison features and payment flexibility. We Have Built Market-Leading Underwriting Capabilities We believe that our credit underwriting capabilities differentiate us from other payment networks and improve our overall commerce experience. With enhanced underwriting, our consumers have access to numerous payment methods that help promote their financial well-being while our merchants drive additional sales. Our proprietary data enables us to make decisions in seconds, fully automate our process and underwrite every transaction in real time. We also provide a small spending capacity to consumers, which gradually increases as consumers responsibly spend more with Klarna, and clear repayment terms that encourage borrowers to repay on time, a unique approach to extending consumer credit compared to market alternatives. Our average balance per consumer is lower than credit cards and average loan duration is shorter than other banks and credit providers, which provides us the ability to quickly react to market changes and efficiently manage our credit risk. Our Network Fuels a Powerful Advertising Solution We have built a highly differentiated advertising solution based on the close relationship we maintain with our consumers and merchants and the vast amounts of data they entrust to us. We use proprietary data, including first-party, SKU-level data, such as browsing, searching, transacting, tracking, returning and customer service data, to help merchants reach and engage high-intent consumers with relevant advertisements. We offer brand, search and affiliate solutions to advertisers such that they can connect with consumers across the commerce journey. We also allow merchants to reach consumers in a commerce-centric environment, which we believe is the most effective place to reach consumers. These features, together with our vast amounts of data, allow us to deliver to our merchants marketing attribution and better measurability and, as a result, a higher ROI on their advertising spend. We Are a Licensed Bank We have operated as a licensed bank in the EEA since 2017, when the SFSA approved our application for a bank license. This license reinforced our position as a stable, trustworthy institution among our consumers and merchants. Our license enables our differentiated funding strategy by allowing us to fund 95% of our lending activities during the last twelve months ended June 30, 2025 by utilizing deposits, which are highly stable and lower-cost than other non-bank funding strategies, such as asset-backed financing. As our consumers increasingly trust us with their savings, we have collected a large and growing pool of consumer deposits ($14 billion as of June 30, 2025). Our business also benefits from an inherent duration gap between our consumer loans, which had an average duration of approximately 40 days (38 days for Pay Later and 180 days for Fair Financing) in the last twelve months ended June 30, 2025, and our deposits, 68% of which were fixed-term with an average duration of 318 days in the last twelve months ended June 30, 2025. As a result, we can adjust our lending policies more quickly than our deposit base might change. We also have the ability to deliberately change the length and interest rate on the deposits that we offer to adjust this duration gap. Finally, our banking license allows us to design and offer financial products and services that otherwise could require third-party partnerships, like card issuance, and extensive experience and investment to ensure compliance with applicable regulatory requirements. Our Structure Allows Us to Offer Fair and Affordable Products We operate a sustainable business model defined by lower fees for both merchants and consumers relative to legacy payment networks, such as credit cards. Merchants and consumers combined paid 1.2 times and 1.5 times more in fees using credit cards than with Klarna in Western Europe and the United States, respectively, comparing credit card fees in the last twelve months ended June 30, 2025 and our current fees, according to the Market Opportunity Study. We believe our lower fees promote financial well-being for our consumers and align our success with that of our merchants. As we help consumers and merchants save more on each transaction, we give consumers more control over their finances and help them save money. Our network as a whole provides structural competitive advantages, which enable us to independently develop superior experiences for our consumers and merchants, while keeping costs low and driving long-term growth. The collective cost advantages of our network accelerate our network effects, while maintaining our own sustainable financial model. Better for Consumers We are revolutionizing the commerce experience for consumers around the world. We help consumers find personalized brands and products, pay and manage commerce transactions and finances. We do this through our network that prioritizes safety and fairness to consumers. We help our consumers save time and money and put them in control of their commerce experience. Our Globally Recognizable Brand Our brand is globally recognizable. As of December 2024, according to our estimates, we had 40% global brand awareness, as compared to 28% on average for our main competitors, and a global brand trust score of 54%. Our brand also defines our relationship with consumers. In a financial services ecosystem filled with opacity and mistrust, Klarna has created a brand associated with trust, transparency and financial wellness. This brand resonates with our consumers, merchants, partners and employees. Our Consumer Solutions Our consumer solutions are built to address the commerce journey Find. We allow our consumers to discover and engage with merchants pre-purchase with AI-powered, personalized recommendations. Solutions we offer include personalized inspiration, merchant deals, cashback offers, product search, price drop notifications and price comparison, and the ability to create wish lists. Pay. We offer consumers transparent and seamless purchase capabilities through our multiple payment options that allow consumers to pay in whichever way is most convenient for them, including debit and credit, without hidden fees or revolving credit. Our payment options have promoted safety and trust since our inception when we first enabled consumers to pay after receiving their goods. Manage. We provide consumers a holistic suite of services to fully understand purchases, track after-purchase activities such as shipping and returns, and manage personal finances with intuitive financial overviews and deposit and savings accounts. Our solutions include loyalty cards, the ability to track delivery and returns, AI-enabled customer support, and insights into personal finances. Advantages of Our Consumer Solutions Consumers shop effortlessly on our network. We believe we offer them a more relevant and convenient way to shop that also provides greater financial control. Our consumer solutions are personalized, convenient and easy, safe and trustworthy, affordable, transparent and fair. Increasing Diversity of Use Cases and Frequency for Our Consumers We believe the breadth and quality of our products drive consumers to use Klarna for more of their purchases and across additional verticals over time. As our markets mature and consumers use our network for longer, the average consumer purchase frequency typically increases. Similarly, purchases across verticals also generally become more diversified over time. Better for Merchants We believe we are revolutionizing commerce for merchants, enabling them to succeed on every mission-critical business priority. Our Merchant Solutions Our merchant solutions enable merchants to grow their businesses and attract, engage and retain customers by partnering with Klarna. Numerous Channels to Connect to Our Consumers. Merchants around the world can connect to our network through a single shared API and gain access to our consumers nearly instantly. We offer multiple channels for merchants to connect to our network both online and offline, including embedding Klarna payment options at checkout on their websites or in apps, on the Klarna app, by accepting the Klarna card, in-store solutions and a full checkout experience that also accepts other payment options. Merchant Enablement and Growth Tools. We provide merchants with several merchant tools that help accelerate the growth of their businesses. We offer a host of solutions that drive conversion at checkout, such as on-site messaging, which promotes Klarna as a payment method, express checkout, which provides a one-click purchase experience, and merchant offers, which promote products and services selected by the merchant. We also operate a merchant portal that organizes various tasks for business management such as daily sales overviews or customized settlement reports. Advertising to Help Merchants Better Connect with Consumers. We have developed highly differentiated advertising solutions that allow merchants to reach and engage high-intent consumers in a commerce-centric environment. Our merchant solutions provide better conversion rates, new customers, higher AOVs, fair fees, full brand control and rich data insights. Proprietary Data, Technology Platform and AI Strategy Since 2005, Klarna has been a constant innovator in our industry. We were a first mover in the buy now, pay later space, built a disruptive brand when we obtained our banking license, integrated pay anywhere into the Klarna app and leveraged our data to develop highly differentiated advertising solutions. Today, we are among the very first to adopt AI, which we use to improve consumer personalization as well as achieve internal efficiencies. Consumer Data at the Core of Our Technology Platform The strong trust and engagement we have earned from our consumers and merchants give us a unique data advantage. This data powers our understanding of intent, purchase history and consumer profiles. Our Single, Cloud-Based Technology Platform Because we operate a single cloud-based platform, our consumer and merchant solutions are highly scalable and secure. This underlying technology enables merchants around the world to connect to our network through a single shared API and gain access to our millions of consumers nearly instantly. We prioritize building our own technology and investing in extraordinary engineering talent. We Are an AI-Powered Company We believe that society will experience vast changes that will be powered by AI. Accordingly, we are utilizing AI to transform commerce. We harness AI for the benefit of consumers, merchants and our employees. AI makes us more productive and efficient. As of August 31, 2024, 96% of our employees used generative AI in their daily work, according to our internal data gathered from OpenAI and our internal AI tools. Generative AI Improves Merchant Conversion and Accelerates Our Revenue. We present consumers with AI-powered personalized shopping feeds that allow them to discover dynamic and personalized brand, product and creator recommendations. We have also developed an AI shopping assistant that enables merchants to make strategic product recommendations to consumers. Generative AI Streamlines the Consumer Experience and Reduces Our Costs. In February 2024, we launched our AI assistant in partnership with OpenAI, available in the Klarna app. This chatbot enhances consumer shopping and payment experiences and manages various tasks, such as multilingual customer service and refunds and returns. ML Supplements Our Credit Underwriting. ML enhances our high-frequency, large-scale and real-time underwriting, which helps drive conversion rates and minimizes credit losses. Generative AI Enhances Our Productivity and Drives Increasing Efficiency. We use AI to increase productivity within our engineering and operational teams. As of June 2025, 80% of our engineers and data scientists connected to their work software an AI copilot that can create and review code (based on data exported from the AI copilot). Our legal teams use AI to expedite document review. We also use AI to minimize external vendor costs. Additionally, we operate an internal knowledge chatbot, which we call Kiki, that helps employees find information in real time across internal systems. These internal applications of AI have dramatically increased our average revenue per employee in recent periods. Our Growth Strategies Our vision is a world where Klarna empowers everyone, everywhere, through seamless commerce experiences as a personalized, trusted assistant making financial empowerment effortless. Success in the future will belong to global companies with lean technology and best-in-class customer acquisition models. We believe the foundations of our network that we have built and our strategic initiatives position us to deliver on this vision. Our strategic priorities to fuel our future growth include Klarna at Every Checkout. We seek to continue to grow the number of merchants on our network and enable their success. Leverage our proven global go-to-market merchant strategy. Deepen our partnerships with PSPs. Expand into new verticals. Partner with digital wallets seamless integration with Apple Pay and Google Pay. Enter new geographical markets. Klarna Card in Every Wallet. We envision Klarna becoming the default payment method for our millions of active Klarna consumers and future consumers. With the Klarna card, we are making it easier for consumers to enjoy our popular flexible payment options, both online and offline. Next-Generation Digital Financial Services. As a digital-first neobank, Klarna s services are automated, insight-driven and designed to be transparent, fair and intuitive. We partner with PSPs, traditional banks, card networks, commerce enablers, technology partners, merchants and shipping and return logistics providers to improve the commerce experience for our consumers. This breadth of our ecosystem, coupled with our extensive portfolio of licenses and regulatory authorizations, allows us to provide consumer services that others cannot, such as instant refunds, cashback, real-time debit or order and return tracking. These features save consumers time and money and effortlessly put them in control of their finances. Klarna s Personal Shopping and Money Assistant. We are redefining lifestyle services by becoming the genuine partner that truly enhances the everyday shopping experiences of our consumers. Leveraging our unique insights from proprietary data, including first-party, SKU-level data, we offer personalized services that act as a true utility for consumers. This deep understanding enables us to tailor individualized offers for goods and services today and, in the future, we expect to expand into personalized financial services. Our AI-powered personal assistant is at the heart of this transformation, making the consumer journey both effortless and joyful. Consumers gain access to premium features through subscription services, enhancing their lifestyle while enjoying convenience and savings. AI-Powered Efficiency. AI allows us to drive scale efficiencies greater than what was previously thought possible, allowing our deep talent pool to focus on innovation and growth. Corporate Reorganization In May 2024, we redomiciled our parent company from Sweden to the U.K. by way of a share-for-share exchange. Pursuant to the share-for-share exchange, shareholders of Klarna Holding AB exchanged their shares for an equal number of shares in Klarna Group plc. As a result of our corporate reorganization, Klarna Group plc became our ultimate holding company and the parent company of Klarna Holding AB. See Description of Share Capital and Articles of Association Corporate Reorganization. Recent Developments OnePay Partnership In March 2025, we entered into a customer installment program agreement (the OnePay Partnership Agreement ) with OneProgress Services LLC ( OnePay ), a consumer-oriented financial technology company majority-owned by Walmart Inc., a people-led, tech-powered omnichannel retailer ( Walmart ). Pursuant to the OnePay Partnership Agreement, we will exclusively offer our Fair Financing product to Walmart s U.S. customers and members both online and in-store. As a result, alternative interest-bearing payment solutions of our competitors will no longer be available at checkout at Walmart. Beginning in the second half of 2025, our Fair Financing products will be made available at checkout online and in-store through OnePay s platform, which is directly integrated into Walmart s physical and digital distribution channels. Once approved for our financing products, Walmart s U.S. customers will be able to choose from a range of repayment terms from three to 36 months. Concurrently with the OnePay Partnership Agreement, we issued warrants to a subsidiary of OnePay to acquire 15,343,932 of our ordinary shares (the OnePay warrants ). The OnePay warrants will vest over a period of five years. 2,640,000 OnePay warrants vested in May 2025 and 2,400,000 of them were exercised, with the remainder vesting quarterly in equal installments. Repurchase of KHAB Warrants and Roll-Up of Larkan Shares In order to simplify our shareholder structure, substantially concurrently with this offering, Klarna Holding, our former parent company and an indirect wholly owned subsidiary, intends to repurchase an aggregate number of 1,267,752 warrants to acquire its ordinary shares (such warrants, KHAB warrants ), which were issued prior to our corporate reorganization at various times under our legacy equity incentive schemes (the KHAB Warrant Repurchase ). Klarna Holding will fund the KHAB Warrant Repurchase using cash on hand. We estimate that the aggregate price to be paid for the KHAB warrants being repurchased will be approximately $13.5 million, based on the initial public offering price of $36.00 per ordinary share, which is the midpoint of the estimated price range set forth on the cover page of this prospectus. In addition, substantially concurrently with this offering, we expect to facilitate an exchange of ordinary shares of Larkan (such ordinary shares, Larkan shares ) originally issued prior to June 30, 2025 upon vesting of RSUs awarded to our employees, including our executive officers, pursuant to our legacy RSU program and outstanding as of the date of this prospectus (the Legacy RSU Roll-Up ). The aggregate number of our ordinary shares to be issued as a result of the Legacy RSU Roll-Up will be approximately 2,326,671, based on the initial public offering price of $36.00 per ordinary share, which is the midpoint of the estimated price range set forth on the cover page of this prospectus. See Executive and Director Remuneration Equity-Related Programs Employee Restricted Share Unit Program. Corporate Information We are a public company with limited liability incorporated pursuant to the laws of England and Wales on November 7, 2022 as Klarna UK II PLC and renamed as Klarna Group plc on December 13, 2023. We are registered with the Registrar of Companies in England and Wales under number 14467769. Our registered office is located at 10 York Road, London SE1 7ND, United Kingdom, and the telephone number at that office is +44 8081 893 333. Our banking operations in the EEA are conducted through Klarna Bank AB. Klarna Bank AB was incorporated as a public limited company with the legal name Kreditor Finans AB under Swedish law on September 5, 2007, with the company number 556737-0431. After its incorporation, Kreditor Finans AB changed its legal name to Klarna Finans AB and, following the receipt of a license to carry out banking activities under the supervision of the SFSA, subsequently changed its legal name to Klarna Bank AB on June 19, 2017. Klarna Bank AB is a subsidiary of Klarna Holding AB. As a result of our corporate reorganization in May 2024, Klarna Holding AB and Klarna Bank AB became indirect subsidiaries of Klarna Group plc. Our main U.S. subsidiary is Klarna Inc., a Delaware corporation. Its principal office is located at 800 N. High St., Ste. 400, Columbus, Ohio 43215, and the telephone number at that office is +1 (844) 552 7621. Our website address is www.klarna.com. We have included our website address in this prospectus solely as an inactive textual reference. Information contained on, or that can be accessed through, our website is not incorporated by reference into this prospectus or the registration statement of which it forms a part, and you should not consider information on our website to be part of this prospectus or the registration statement of which it forms a part. Our agent for service of process in the United States is Klarna Inc.
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+PROSPECTUS SUMMARY This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under "Risk Factors" and our financial statements and the related notes included elsewhere in this prospectus before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: "we," "us," "Company" or "our Company" are to CSLM Digital Asset Acquisition Corp III, Ltd, a Cayman Islands exempted company; "amended and restated memorandum and articles of association" refer to the memorandum and articles of association of the Company which will be adopted prior to the consummation of this offering. "CCM" are to Cohen & Company Capital Markets, a division of Cohen & Company Securities, LLC, the underwriter; "combined team" refer to our management team and our other advisors, collectively; "Companies Act" or "Companies Law" are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time; "completion window" are to (i) the period ending on the date that is 24 months from the closing of this offering, or such earlier liquidation date as our board of directors may approve, in which we must complete an initial business combination or (ii) such other time period in which we must complete an initial business combination pursuant to an amendment to our amended and restated memorandum and articles of association (in which case our public shareholders will be offered an opportunity to redeem their public shares in connection with any such amendment); "CIM" are to Consilium Investment Management LLC; "Consilium" are to CIM (as defined herein) together with its affiliate entities and funds, excluding the Company and Sponsor (as defined herein); "directors" are to our current directors and our director nominees named in this prospectus; "Emerging Markets" are to (i) those markets/countries not included in the MSCI World Index1 and (ii) Hong Kong; "Frontier Growth Markets" are to those countries included in the MSCI Frontier Markets Index2 or the MSCI Frontier Emerging Markets Index3; 1 The MSCI World Index includes Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, the UK and the US. 2 The MSCI Frontier Markets Index includes: Bahrain, Bangladesh, Benin, Burkina Faso, Croatia, Estonia, Guinea-Bissau, Iceland, Ivory Coast, Jordan, Kazakhstan, Kenya, Latvia, Lithuania, Mauritius, Morocco, Mali, Niger, Oman, Pakistan, Romania, Senegal, Serbia, Slovenia, Sri Lanka, Togo, Tunisia and Vietnam. 3 The MSCI Frontier Emerging Markets Index includes Bahrain, Bangladesh, Burkina Faso, Benin, Colombia, Croatia, Estonia, Egypt, Guinea-Bissau, Iceland, Ivory Coast, Jordan, Kenya, Kazakhstan, Lithuania, Mauritius, Mali, Morocco, Niger, Oman, Peru, Philippines, Pakistan, Romania, Serbia, Senegal, Slovenia, Sri Lanka, Togo, Tunisia and Vietnam. 1 Table of Contents "founder shares" are to Class B ordinary shares initially purchased by our Sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares concurrently with or immediately following the consummation of our initial business combination or earlier at the option of the holders thereof as described herein (for the avoidance of doubt, such Class A ordinary shares will not be "public shares"); includes the 20,000 founder shares (or 100,000 in the aggregate) that have been transferred pursuant to a Securities Transfer Agreement, by our Sponsor, to each of the Company s director nominees, Christopher Bradley, Brian Rudick, Mathew August, Danel Calvillo Armendariz and Dr. Jim Kyung Soo Liew, for the sum of $0.003 per share; "initial shareholders" are to our Sponsor and any other to holders of our founder shares immediately prior to this offering; "management" or our "management team" refer to our directors and executive officers; "non-managing Sponsor investors" means six (6) institutional investors (none of which are affiliated with any member of our management, other members of our Sponsor or any other investor) that have expressed an interest to purchase through the purchase of securities in the Sponsor, an aggregate of 180,000 private units at a price of $10.00 per unit ($1,800,000 in the aggregate); subject to the non-managing Sponsor investors purchasing, through the Sponsor, the private units allocated to them in connection with the closing of this offering, the Sponsor will issue securities at a nominal purchase price to the non-managing Sponsor investors at the closing of this offering reflecting interests in an aggregate of 900,000 founder shares held by the Sponsor. "ordinary resolution" are to a resolution of the Company passed by a simple majority of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at a general meeting of the Company, or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter (or such lower threshold as may be allowed under the Companies Act from time to time); "permitted withdrawals" refers to withdrawals to cover any income, franchise or excise tax obligations of the Company. "permitted transferees" refer to permitted transferees as described under section "Principal Shareholders" of this prospectus; "ordinary shares" are to our Class A ordinary shares and our Class B ordinary shares; "private shares" are to the Class A ordinary shares included in the private units; "private units" are to the units issued to our Sponsor and the underwriter in a private placement simultaneously with the closing of this offering; "private warrants" are to the warrants included in the private units; "public shares" are to Class A ordinary shares sold as part of the public units in this offering (whether they are purchased in this offering or thereafter in the open market); "public shareholders" are to the holders of our public shares, including our initial shareholders, our management team and any non-managing Sponsor investors to the extent our initial shareholders, members of our management team or any non-managing Sponsor investors purchase public shares, provided that the each initial shareholder s, member of our management team s or any non-managing Sponsor investors status as a "public shareholder" will only exist with respect to such public shares; 2 Table of Contents "public warrants" are to the warrants sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); "special resolution" are to a resolution of the Company passed by at least a two-thirds (2/3) majority (or such higher approval threshold as specified in the Company s amended and restated memorandum and articles of association) of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at a general meeting of the Company of which notice specifying the intention to propose the resolution as a special resolution has been duly given, or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter (or such lower threshold as may be allowed under the Companies Act from time to time); "Sponsor" are to CSLM Acquisition Sponsor II, Ltd, a Cayman Islands exempted company, newly formed for the purpose of acting as the Sponsor in connection with this offering that which conducts no other business which is affiliated with our executive officers, directors and our other advisors; "warrants" are to our public warrants, private warrants and working capital warrants, if any; "warrant exercise date" are to the date on which the warrants will become exercisable, which is 30 days after the completion of our initial business combination; "warrant expiration date" are to the date on which the warrants expire, which is five years after the completion of our initial business combination or earlier upon redemption or liquidation; "working capital loans" refers to up to $1,500,000 in working capital loans made by Sponsor to the Company, which loans may be convertible into units of the post-business combination entity at a price of $10.00 per unit; "working capital units" are the units that are issuable upon conversion of the working capital loans; "working capital warrants" are to the warrants that are components of the units issuable upon conversion of working capital loans; and "$," "US$" and "U.S. dollar" each refer to the United States dollar. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any forfeiture of shares, and all references to forfeiture of shares, described in this prospectus shall take effect as a surrender of shares for no consideration as a matter of Cayman Islands law. Any share dividend described in this prospectus will take effect as a share capitalization as a matter of Cayman Islands law (that is, an issuance of shares from share premium). Unless we tell you otherwise, the information in this prospectus assumes that the underwriter will not exercise its over-allotment option. You should rely only on the information contained in this prospectus. We have not, and the underwriter has not, authorized anyone to provide you with different information. We are not, and the underwriter is not, making an offer of these securities in any jurisdiction where the offer is not permitted. 3 Table of Contents General We are a blank check company incorporated on July 26, 2024 under the name "CSLM Acquisition Corporation II, Ltd" as a Cayman Islands exempted company, and re-named "CSLM Digital Asset Acquisition Corp III, Ltd" by special resolution, on May 23, 2025, with no material operations of our own and formed for the purpose of effecting a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. Investment Focus While we may pursue an initial business combination in any business or industry, we expect to focus on sectors aligned with the ongoing digitization of financial infrastructure. These include digital assets, Web3 technologies, financial services infrastructure, and other blockchain-driven business models. Additionally, we will maintain a strong emphasis on companies based in or focused on emerging and frontier markets. Our efforts to identify a potential initial business combination target will focus on companies operating in the "new economy sectors", which we broadly define as those in technology, financial services, or media and that are located in Frontier Growth Markets (as defined herein). While we may pursue an initial business combination opportunity in any country or sector, we intend to capitalize on decades of experience of our management team and board to identify, acquire and manage a business or businesses that we believe can benefit from their long-established relationships and expertise of having operated a successful investment management business in these regions. Our management team and board have extensive experience in identifying and executing investments at the global scale successfully across a number of sectors, and countries less followed by traditional investment managers. Given our management team and board members perspective on technology, quantum computing and other growth industries, having looked at over a thousand acquisition targets over the past decade, we will be examining in particular opportunities in artificial intelligence ("AI") as well as in the rapidly growing crypto and decentralized finance ("DeFi") areas. For example, CSLM Acquisition Corp. has entered into a definitive agreement with Fusemachines, a company that provides AI-driven products and solutions such as AI Studio and AI Engines, and has established a global AI talent pool through its flagship AI Fellowship programs. As part of the CSLM Acquisition Corp. transaction evaluation process, Charles T. Cassel III and Jonathan Binder participated in the diligence and assessment of a broad universe of acquisition targets, including the eventual agreement with Fusemachines. Their roles at Consilium Investment Management further support their ability to evaluate, underwrite and manage complex cross-border investments in the "new economy sectors." In addition to CSLM Acquisition Corp., members of our management team and affiliates have been involved in multiple special purpose acquisition companies. Vikas Mittal, our Chairman and Chief Financial Officer, has invested in SPACs since 2008 and brings significant experience across the SPAC lifecycle. He has invested in private securities of SPAC sponsors, SPAC IPOs, secondary trading of SPAC securities, and deSPAC investments in both equity and debt. Mr. Mittal was also a member of the sponsor of GSR II Meteora Acquisition Corp., which completed its business combination with Bitcoin Depot Inc. (NASDAQ: BTM) in 2023. Mr. Mittal also serves as CEO and CFO of Investcorp Europe Acquisition Corp I, which announced a business combination with Nexx HoldCo, LLC (NexxBuild). Additionally, Mr. Mittal serves as CFO of Berto Acquisition Corp. Christopher Bradley, our independent director nominee, has served in key roles for multiple SPACs. He served as Chief Financial Officer of Haymaker Acquisition Corp. (which closed a merger with OneSpaWorld), Haymaker Acquisition Corp. II (which closed a merger with ARKO Holdings), and Haymaker Acquisition Corp. III (which closed a merger with Biote Holdings). He currently serves as Chairman, CEO, CFO and Secretary of Haymaker Acquisition Corp. 4. In each of these roles, Mr. Bradley has been responsible for target sourcing, evaluation, and execution. 4 Table of Contents Our Sponsor Our Sponsor is CSLM Acquisition Sponsor II, Ltd, a Cayman Islands exempted company, which was incorporated on July 26, 2024 to invest in our Company. Although our Sponsor is permitted to undertake any activities permitted under the Companies Act and other applicable law, our Sponsor s business is focused on investing in our Company. Our Sponsor is managed by its two directors, Charles T. Cassel III and Vikas Mittal and is beneficially owned (i) 51% by Samara CSLM LLC and (ii) 49% by Consilium Investment Capital Inc. Consilium Investment Capital Inc., a Florida corporation, is legally and beneficially owned 50% by Charles T. Cassel III and 50% by Jonathan Binder. Samara CSLM LLC, a Delaware limited liability company, is legally and beneficially owned solely by Vikas Mittal and his immediate family. The economic interests of our Sponsor are currently 100% owned by Samara CSLM LLC and Consilium Investment Capital Inc. Upon the closing of this offering, certain non-managing Sponsor investors will own securities in our Sponsor, as described in this prospectus. Our Sponsor is an affiliate of Consilium Investment Management LLC ("CIM"), an SEC-registered investment management firm headquartered in Fort Lauderdale, Florida. Charles T. Cassel III, our Chief Executive Officer and Jonathan Binder, one of our directors, are principals of CIM. Given our affiliation with CIM, we intend to capitalize on its global platform and investment expertise which we believe, together with the extensive experience of our management team, well positions our Company to be the partner of choice for quality Frontier Growth companies seeking public Sponsorship. CIM will assist with general diligence, administrative, and advisory support we require in the sourcing of potential targets for our initial business combination or in its general role as advisor. However, we have not entered into a formal agreement with CIM and we will not compensate CIM for such services. The founders of CIM have over six decades of experience in Emerging Markets and Frontier Growth Markets. They have deep relationships with companies, management teams, policy makers, and advisors in the space. CIM and its founders have participated in private equity and mezzanine financing transactions and will rely on their broad network in Frontier Growth Markets in order to identify target acquisitions that have the desire to list in the United States and have the infrastructure necessary to comply with regulatory requirements. Our Sponsor is an also affiliate of Meteora, an investment adviser specializing in SPAC-related investments. Vikas Mittal, our Chairman and Chief Financial Officer, is the Managing Member and Chief Investment Officer of Meteora. Meteora will act as an advisor to the Company in connection with this offering and, in such capacity, will provide general diligence, administrative, and advisory support, but has not entered into any formal agreement with the Company and we will not compensate Meteora for such services. Meteora s principals have previous experience across the full lifecycle of SPACs, from the initial public offering to the de-SPAC business combination process. Meteora will provide resources including a network of relationships, extensive SPAC knowledge base and a standardized SPAC operating system to streamline the business combination process. Meteora s ability to invest across the entire SPAC capital structure (risk capital, primary market, secondary market, PIPEs, convertible notes and other special situations) has created an end-to-end platform and partner to SPAC sponsors. Furthermore, Meteora has diverse sector experience across digital assets, technology, media & telecommunications, fintech, energy, consumer and retail, business and distribution services, healthcare, aerospace and defense. Meteora believes that its access to numerous private equity and venture capital backed private companies provides a robust pipeline for potential acquisition candidates. Pursuant to an agreement of all members of the Sponsor, the management and control of the Sponsor is vested exclusively with Vikas Mittal and Charles T. Cassel III, the directors of the Sponsor, without any voting, veto, consent or other participation rights by any non-managing shareholders regardless of their unit ownership. All matters submitted to a vote by the directors will require the affirmative vote of the class C ordinary shares of the Sponsor which are held only by Samara CSLM LLC and Consilium Investment Capital Inc., without regard to any ordinary shares held by any non-managing members. As a result, non-managing Sponsor investors will have no right to control the Sponsor, or participate in any decision regarding the disposal of any security held by the Sponsor, or otherwise. Funds and accounts managed by, or otherwise affiliated with, our Sponsor may participate in this offering and purchase units at the offering price. These affiliated funds are not obligated to participate, and the extent of their participation may be significant relative to the overall size of the offering. As a result, a substantial portion of the units sold in this offering may be held by affiliates of the Sponsor. None of these affiliated funds have expressed an interest in purchasing more than 9.9% of the public units to be sold in this offering, except that Meteora and its affiliates have expressed an interest in acquiring up to 19.99% of the public units to be sold in this offering. Meteora, for which Mr. Mittal serves as the Managing Member and Chief Investment Officer, and Consilium or their affiliates may also purchase additional public shares which they have agreed to vote in favor of an initial business combination, thereby increasing the increase the likelihood that a proposed shareholder resolution to approve our initial business combination will be passed (whether by way of ordinary resolution or special resolution). If the affiliated funds purchase the full amount of the units for which they have expressed an interest and vote in favor of an initial business combination, we may not need any public shares sold to other investors in this offering to be voted in favor of the initial business combination. Accordingly, we may complete our initial business combination even if holders of a majority of our public ordinary shares do not approve of the business combination we complete. Any participation by affiliated entities may reduce the available public float of our securities, which could limit liquidity in the market for our units, Class A ordinary shares, or warrants following the offering. Additionally, because these affiliated purchasers may have different investment horizons, liquidity needs, or strategic interests than other investors, their participation may not align with the interests of unaffiliated public shareholders. Furthermore, to the extent that affiliated entities hold a material portion of the units and subsequently choose to redeem their public shares in connection with our initial business combination, this could reduce the amount of cash available to the combined company. 5 Table of Contents Sponsor s Securities and Compensation The table below summarizes (i) the amount of founder shares and private units issued or to be issued to the Sponsor in connection with this offering and the price paid or to be paid by the Sponsor for such securities, and (ii) the main items of compensation received or to be received by the Sponsor or our affiliates: Description Price Paid or Payable Number of founder shares 7,666,667 founder shares (of which 1,000,000 are subject to surrender for no consideration to the extent the underwriter does not exercise its over-allotment option)* $0.003 per share Number of private units 500,000 private units (or 575,000 private units if the underwriter s over-allotment option is exercised in full) $10.00 per private unit Office space and general and administrative services Monthly payments to our Sponsor $30,000 per month Working Capital Loans Up to $1,500,000 convertible into private units at a price of $10.00 per unit Not applicable * Class B ordinary shares, will be convertible at the option of the holder on a one-for-one basis or will automatically convert into Class A ordinary shares concurrently with or immediately following the consummation of our initial business combination at a ratio such that the number of Class A ordinary shares issuable upon conversion of all founder shares will equal, in the aggregate, on an as-converted basis, 25% of the sum of (i) the total number of ordinary shares issued and outstanding upon the consummation of this offering, plus (ii) the sum of the total number of Class A ordinary shares issued or deemed issued or issuable upon conversion or exercise of any equity-linked securities (as defined herein) or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of the initial business combination, excluding any Class A ordinary shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued, deemed issued, or to be issued, to any seller in the initial business combination and any private placement-equivalent shares issued to our Sponsor, members of our management team or any of their affiliates upon conversion of working capital loans made to the Company. In no event will the Class B ordinary shares convert into Class A ordinary shares at a rate of less than one-to-one. The Class A ordinary shares issuable upon conversion of our founder shares may ultimately result in material dilution to our public shareholders due to the anti-dilution rights of our founder shares that may result in an issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion. If we increase or decrease the size of this offering pursuant to Rule 462(b) under the Securities Act, we will effect a share dividend, share contribution back to capital, or other appropriate mechanism, as applicable, immediately prior to the consummation of the offering, in such amount as to maintain the collective ownership of the initial shareholders, prior to this offering at approximately 25% of our issued and outstanding Class A ordinary shares (excluding any shares underlying the private units) upon the consummation of this offering. Such issuance will significantly dilute the equity interests of our other shareholders. Pursuant to a Securities Transfer Agreement, our Sponsor has transferred 20,000 founder shares (or 100,000 in the aggregate) to each of the Company s director nominees, Christopher Bradley, Brian Rudick, Mathew August, Danel Calvillo Armendariz and Dr. Jim Kyung Soo Liew, for the sum of $0.003 per share. Consilium Investment Management LLC Our Sponsor is an affiliate of CIM, an SEC-registered investment management firm headquartered in Fort Lauderdale, Florida. Established in 2004, Consilium Investment Management ("CIM") has a long track record of successfully investing in Frontier Growth Markets and has been a top-quartile performer since the inception of its Frontier Equity Fund in 2009. CIM will act as an advisor to the Company in connection with this offering and in our search for a target or business combination and, in such capacity, will provide general diligence, administrative, and advisory support, but has not entered into any formal agreement with the Company and we will not compensate CIM for such services. CIM has a deeply knowledgeable investment team across Frontier Growth Markets with nearly 167 years of combined experience. Its entrepreneurial, cross-collaborative approach enables the team to act with speed and certainty across a wide range of geographies. CIM s objective across all its investment activities is to deliver attractive risk-adjusted returns to investors on a consistent basis. 6 Table of Contents Over the years, CIM has targeted regions and countries with stable monetary and political systems, two ingredients which we believe are essential foundations for economic growth. These, combined with company-specific drivers, are the cornerstones of CIM s process of finding quality growth companies. In particular, we expect outsized growth in the new economy sectors across these regions, driven by private sector expansion, technological innovation, a growing young and middle-class population, increasing consumption, structural economic and policy reforms and demographic changes. CIM manages two products targeted at Frontier Growth Markets. The Consilium Frontier Equity Fund, LP (the "Fund") focuses on listed equities opportunities within Frontier Growth Markets. The Consilium Extended Opportunities Fund, LP ("EOF") focuses on less liquid opportunities within Frontier Growth Markets, and targets a three-year time horizon to extract value from companies that are relatively unknown. Consilium Investment Capital, Inc., a Florida corporation and parent of CIM and parent of the Fund s general partner ("CIC"), is a member of the Sponsor. The founders of CIM have over six decades of experience in Emerging Markets and Frontier Growth Markets. They have deep relationships with companies, management teams, policy makers, and advisors in the space. CIM and its founders have participated in private equity and mezzanine financing transactions and will rely on their broad network in Frontier Growth Markets in order to identify target acquisitions that have the desire to list in the United States and have the infrastructure necessary to comply with regulatory requirements. Meteora Meteora, an investment adviser specializing in SPAC-related investments, will act as an advisor to the Company in connection with this offering and in our search for a target or business combination and, in such capacity, will provide general diligence, administrative, and advisory support, but has not entered into any formal agreement with the Company and we will not compensate Meteora for such services. Vikas Mittal, our Chairman and Chief Financial Officer, is the Managing Member and Chief Investment Officer of Meteora. Meteora s principals have previous experience across the full lifecycle of SPACs, from the initial public offering to the de-SPAC business combination process. Meteora will provide resources including a network of relationships, extensive SPAC knowledge base and a standardized SPAC operating system to streamline the business combination process. Meteora s ability to invest across the entire SPAC capital structure (risk capital, primary market, secondary market, PIPEs, convertible notes and other special situations) has created an end-to-end platform and partner to SPAC sponsors. Furthermore, Meteora has diverse sector experience across digital assets, technology, media & telecommunications, fintech, energy, consumer and retail, business & distribution services, healthcare, aerospace and defense. Meteora believes that its access to numerous private equity and venture capital backed private companies provides a robust pipeline for potential acquisition candidates. Our Management Team We believe that our management team is well-positioned to take advantage of the growing set of acquisition opportunities within Frontier Growth Markets and that our local and global contacts and relationships, ranging from industry executives, private and public business owners and private equity professionals to our extensive network of trusted advisors and consultants across various sectors, will allow us to generate an attractive transaction for our shareholders. In addition, our management team has an established track record in accessing proprietary M&A opportunities among entrepreneurs and family-owned global businesses. Charles T. Cassel III, Chief Executive Officer, is the co-Founder and Chief Executive Officer of CIM. Mr. Cassel is responsible for the risk management for CIM s investment strategies, the day-to-day operations of CIM and all non-equity portfolio management initiatives and also serves as the Chief Compliance Officer of CIM. Before co-founding Consilium in 2004, Mr. Cassel held the position as Head of Emerging Markets Portfolio Management at Standard Asset Management from 1999 to 2004. Prior to that, from 1997 to 1999, Mr. Cassel was at Americas Trust Bank as an Emerging Market debt portfolio manager and was earlier the Chief Financial Officer for the US subsidiary of Banco Cafetero de Colombia from 1992 to 1997, where, among other responsibilities, he ran the bank s international treasury book. Earlier from 1985 to 1991, he was a Portfolio Manager of mortgage-backed securities at Bank Atlantic, a federally chartered savings bank. From 2014 to 2017, Mr. Cassel served as a director of Panache Beverages, Inc. Since January 2022, Mr. Cassel has served as CEO, CFO and Director of CSLM Acquisition Corp. (Nasdaq: CSLM), a special purpose acquisition company focused on new economy sectors and CEO of Edgewater Spirits LLC since January 2023. Mr. Cassel holds a B.A. in Economics from Washington & Lee University (1985) and a Masters in Accounting from Nova Southeastern University (1996). Additionally, he is a CFA charter holder and a member of the CFA Institute. 7 Table of Contents Vikas Mittal, Chairman and Chief Financial Officer, has served as the Managing Member and Chief Investment Officer of Meteora Capital, LLC ("Meteora") since January 2022. Over Mr. Mittal s 20 years on the buy-side as a principal investor, he has deployed capital across event-driven investment strategies. Mr. Mittal was a member of GSR II Meteora Acquisition Corp., where a Meteora investment professional also served as CFO. The SPAC raised $316.25 million in February 2022 and subsequently completed its initial business combination with Bitcoin Depot, Inc. (NASDAQ: BTM), a cryptocurrency platform operating a network of Bitcoin ATMs (BTMs) and a digital wallet application, in June 2023. Bitcoin Depot was founded in 2016 with the mission to connect those who prefer to use cash to the broader, digital financial system. Bitcoin Depot provides its users with simple, efficient and intuitive means of converting cash into Bitcoin, which users can deploy in the payments, spending and investing space. Users can convert cash to Bitcoin at Bitcoin Depot s kiosks and at thousands of name-brand retail locations through its BDCheckout product. The Company has the largest market share in North America with approximately 8,400 kiosk locations as of early 2025. This represents over 30% growth in the number of kiosks since the closing of the business combination. Mr. Mittal has also served as Chief Financial Officer of Berto Acquisition Corp. since June 2025. Prior to Meteora, Mr. Mittal was an investment professional and member of Glazer Capital, LLC ("GCM"), having joined GCM in 2005. Before transitioning to the buy-side, Mr. Mittal was part of the founding team that launched Raymond James TMT investment banking practice in Palo Alto, California, in 2002 focusing on mid-market mergers and acquisitions and private placements. Mr. Mittal earned a B.S. in Finance from University of Florida in 2002, summa cum laude, and earned an MBA from NYU Stern School of Business in 2012. Mr. Mittal is also a CFA holder. Jonathan M. Binder, Director, is the co-Founder of CIM and has served Chief Investment Officer for CIM s Frontier Equity since 2004 and Portfolio Manager for CIM s Extended Opportunities Fund Strategies since 2018. Prior to co-founding Consilium, Mr. Binder spent four years at Standard Asset Management, a division of the Standard Bank Group of South Africa, as Chief Investment Officer, from 1999 to 2004. Mr. Binder had previously spent two years at Americas Trust Bank where he was an Emerging Market equity hedge fund portfolio manager. Prior to this, Mr. Binder was Managing Director of Latin American Equity Capital Markets at Deutsche Morgan Grenfell from 1993 to 1997 and before that, launched James Capel s equity sales trading and research business in Latin America in 1986. Since January 2022, Mr. Binder has served as Chairman and Director of CSLM Acquisition Corp. (Nasdaq: CSLM), a special purpose acquisition company focused on new economy sectors. He graduated from the University of Bristol, England, with a B.Sc. (Econ) joint honors degree in Economics and Politics (1983). Mr. Binder is an alumnus of Eton College. Independent Board Upon the effectiveness of the registration statement of which this prospectus forms a part, we expect that our board of directors will consist of seven members, five of which will be "independent directors" as defined in Nasdaq listing standards and applicable SEC rule. Christopher Bradley, is a director nominee. Mr. Bradley is a Managing Director at Mistral Equity Partners, which he joined in 2008. Mr. Bradley brings over 20 years of experience in identifying acquisition candidates, board service, due diligence experience including accounting and financial modeling acumen, and a background in deal structuring. He currently serves as Chief Financial Officer and Secretary (since 2023) and Chief Executive Officer and Chairman (since 2024) of Haymaker Acquisition Corp. 4 and previously served as the Chief Financial Officer of Haymaker Acquisition Corp. III until it completed its business combination in May 2022 with Biote, Corp., and has since been retained by Biote as an advisor. Mr. Bradley served as the Chief Financial Officer and Secretary of Haymaker Acquisition Corp. II from 2019 until its merger with ARKO (NASDAQ:ARKO) in December 2020. He served as the Chief Financial Officer and Secretary of Haymaker Acquisition Corp. I from 2017 until its business combination with OneSpaWorld (NASDAQ:OSW) in 2019. Since 2016, Mr. Bradley has served as Co-Chief Executive Officer and a member of the board of directors of The Beacon Consumer Incubator Fund, a venture capital fund that invests in consumer technology companies. Mr. Bradley also previously served on the board of directors of Creminelli Fine Meats, LLC, a privately held premium-priced charcuterie wholesaler from 2016 to January 2020, The Lovesac Company, Inc. (NASDAQ:LOVE) from 2010 to 2019, Roth CH Acquisition Corp. since 2023, and Carnegie Park Capital since 2024. Mr. Bradley also served as Chief Financial Officer of Tastemaker Acquisition Corp. from 2021 to 2023 and AF Acquisition Corp. from 2021 to 2022. Mr. Bradley has also guided Mistral portfolio companies in an operational role and, through Mistral, served on the board of Jamba, Inc. (NASDAQ: JMBA) from 2009 to 2013. Prior to Mistral, Mr. Bradley served as an investment banker at Banc of America Securities from 2005 to 2006, a Manager in Burger King s strategy group in 2004, and a Manager at PricewaterhouseCoopers management consulting practice from 1999 to 2004. He is also currently serving on the advisory board of Carnegie Park Capital, a private investment fund. Mr. Bradley earned an A.B. from the University of Chicago and an M.B.A. from The Harvard Business School. 8 Table of Contents Mathew August is a director nominee. Mr. August is the Managing Director and Executive Chairman of Atlas Capital Partners, a New York–based single family office investment firm and merchant bank, and its related entity, ACP Animus Capital Partners, positions he has held since 2016. He has over 15 years of experience in long-term investing, advising, and building companies across the venture capital, private equity, and public markets. His investment and advisory focus spans a broad range of industries, including infrastructure, technology, digital assets, defense, consumer products, and strategic critical resources. Prior to founding Atlas, Mr. August was the Founder and Vice Chairman of a Canadian-based merchant bank, where he advised on and led transactions totaling in the billions across multiple sectors. Earlier in his career, he served as an FX desk trader at Olympia Trust Company (TSX: OLY). Mr. August currently incubates, invests in, and advises a number of public and private companies, and serves on both advisory boards and formal boards of directors. His current and past affiliations include Laconic Infrastructure Partners Inc.; GSR III Acquisition Corp. (NASDAQ); Colonial Energy Capital Inc.; Critical Metals Corp. (NASDAQ: CRML); Edge Total IQ (TSX); Volt Lithium Ltd. (TSX); Onefluent Media Inc.; Funny Water Beverages LLC; NexMetals Mining Corp. (TSX); BIOSG; and Streamex Commodities Exchange Corp. (NASDAQ: BSGM), among others. Brian Rudick is a director nominee. Brian Rudick is a seasoned finance and digital assets executive with a broad track record spanning traditional banking, crypto markets, and strategic advisory roles. He currently serves as Chief Strategy Officer at Upexi Inc. (Nasdaq: UPXI), where he oversees the company s cryptocurrency strategy, investor relations, marketing, and go-to-market planning. Immediately prior, Mr. Rudick was Head of Research at GSR, the world s largest digital-asset market-maker, where he generated key thought leadership and guided GSR s investment into Upexi s $100 million private placement. Before transitioning to digital assets, he spent over a decade on Wall Street, primarily managing long short portfolios of bank stocks at Citadel, Balyasny, and Millennium. Mr. Rudick began his career at the Federal Reserve, conducting research central to the monetary-policy process. He holds a Bachelor of Science from Duke University, an MBA from The University of Chicago Booth School of Business, and is a CFA Charterholder. Mr. Rudick s experience spans traditional asset management, digital markets, and macroeconomic research. Danel Calvillo Armendariz is a director nominee. Danel Calvillo Armendariz is an experienced financial executive with deep expertise in banking, financial regulation, and digital assets. Since January 2022, he has served as Managing Partner of Inertia Advisory LLC, where he advises financial institutions, family offices, and regulated funds on investment structuring, digital asset licensing, and regulatory compliance. He has led engagements with the Roat n Financial Services Authority and secured VASP licenses from the Bank of Spain for institutional clients, including oversight of stablecoin-based remittance operations. Mr. Calvillo Armendariz is also the legal representative of Motus LLC and Motus Wyoming LLC, subsidiaries of Inertia Advisory, where he oversees financial services licenses, digital asset operations, and stablecoin distribution, including direct minting and redemption capabilities with Tether. He serves as Director of Inertia Funds Ltd., where he led the launch of a MiFID II-regulated crypto index fund listed on the Frankfurt Stock Exchange. Previously, Mr. Calvillo Armendariz worked in the Blockchain and Digital Assets division of BBVA, contributing to the bank s digital asset offerings in Switzerland and global strategy development. He holds board roles at Espresso Americano Espa a and Goldsmith Investments SL. Mr. Calvillo Armendariz earned his Master s in Banking and Financial Regulation from Universidad de Navarra, where his thesis focused on the role of CBDCs in commercial banking. His experience spans global finance, digital infrastructure, and regulatory innovation. Dr. Jim Kyung-Soo Liew is a director nominee. Dr. Jim Kyung-Soo Liew is the Founder and President of SoKat Consulting LLC, a premier artificial intelligence solutions firm delivering cutting-edge machine learning and data science applications to U.S. federal agencies and top-tier financial institutions. He also serves as an Associate Professor of Finance at the Johns Hopkins Carey Business School, where he teaches AI Essentials for Business, Cryptos and Blockchain, and Entrepreneurial Finance. A recognized thought leader at the intersection of finance and technology, Dr. Liew has received multiple Dean s Awards for Faculty Excellence. He currently serves on the editorial boards of the Journal of Portfolio Management, Journal of Alternative Investments, Journal of Financial Data Science, and the Journal of the British Blockchain Association. Before founding SoKat, Dr. Liew was Vice President at Carlyle Asset Management Group, Senior Researcher at Campbell & Company—a multi-billion dollar quantitative hedge fund—and began his career at Morgan Stanley as a Quantitative Strategist, building models for trading and risk management. Dr. Liew earned a Ph.D. in Finance from Columbia University and a B.A. in Mathematics from the University of Chicago. His work bridges academia, FinTech innovation, and real-world impact in the rapidly evolving AI and financial technology landscape. 9 Table of Contents Past performance of our management team and advisors or their affiliates including without limitation CIM is not a guarantee either (i) of success with respect to any business combination we may consummate or (ii) that we will be able to identify a suitable candidate for our initial business combination. You should not rely on the historical performance record of our management team and advisors or their affiliates as indicative of our future performance. Our officers and directors may have conflicts of interest with other entities to which they owe fiduciary or contractual obligations with respect to initial business combination opportunities. For a list of our officers and directors and entities for which a conflict of interest may or does exist between such persons and us, as well as the priority and preference that such entity has with respect to performance of obligations and presentation of business opportunities to us, please refer to the table and subsequent explanatory paragraph under "Management — Conflicts of Interest." We believe our management team and advisors have the skills and experience to identify, evaluate and consummate a business combination and is positioned to assist businesses we acquire. However, our management team and advisors network and investing and operating experience do not guarantee a successful initial business combination. The members of our management team and advisors are not required to devote any significant amount of time to our business and are concurrently involved with other businesses. There is no guarantee that our current officers and directors will continue in their respective roles, or in any other role, after our initial business combination, and their expertise may only be of benefit to us until our initial business combination is completed. Market Opportunity We believe the convergence of blockchain innovation and underpenetrated financial infrastructure in frontier growth markets represents a generational investment opportunity. Frontier markets in the Middle East North Africa ("MENA"), Sub-Saharan Africa ("SSA"), South Asia ("SA") and Southeast Asia ("SEA") are rapidly digitizing, and crypto rails are increasingly leapfrogging legacy systems to provide access to payments, remittances, lending, and savings products. We are especially focused on: Blockchain infrastructure (L1s, L2s, rollups) Tokenized real-world assets (RWAs) Institutional-grade custody, staking, and compliance solutions Cross-border payments and remittance platforms Decentralized financial services (DeFi) with real-world integration Emerging market exchanges and wallet providers Stablecoin on-ramps and payment rails Our strategy is to identify companies that are building real utility and adoption with a clear regulatory path and strong alignment with local market dynamics. Our ideal partner is mission-driven, globally scalable, and benefits from increased institutional and retail crypto adoption across emerging markets. While our primary focus will be in digital asset infrastructure and applications, we will remain opportunistic in pursuing high-quality companies aligned with our expertise across the new economy sectors within frontier growth markets. 10 Table of Contents We believe this growth in these new economy sectors across Frontier Growth Markets will be driven by private sector expansion, technological innovation, a growing young and middle-class population, increasing consumption, structural economic and policy reforms and demographic changes in the region. We believe that Frontier Growth Markets are entering a new era of economic growth, particularly in the new economy sectors, which we expect will result in attractive initial business combination opportunities for attractive risk-adjusted returns. These markets are host to a fast growing population of over 2.8 billion people, real GDP of approximately $11 trillion as of 2023, a proportion of young people with access to internet economy ecosystems and growing rapidly, often by executing business models that are already proven in more developed markets (delivery and logistics apps, e-commerce and social commerce, media streaming, mobile wallets, etc.), and in other instances innovative, tailored solutions addressing specific market needs (alternative finance, mobile payments). We believe that the largest global companies are often unable to localize their products and services to be compelling (e.g. cash on delivery to address low credit card penetration in some markets). Middle East North Africa: We believe relatively higher incomes (especially in the Gulf Cooperation Council ("GCC") countries) and internet access with very low but fast-growing e-commerce penetration are creating opportunities in e-commerce, delivery services, classifieds and internet infrastructure. Sub-Saharan Africa: In SSA, owing to a significant unbanked population, card and digital payments remain low. This has led to significant growth in mobile wallets, alternative lenders and payments, and remittance businesses that we believe represent attractive potential opportunities for us. South Asia (excluding India): With a population of over 400 million across Pakistan and Bangladesh, with nearly half under the age of 25 as of 2021, rapidly rising per capita incomes and urbanization levels, we believe South Asia is a very attractive market for technology and technology enabled businesses in sectors such as e-commerce, ed-tech and food-tech. We believe high mobile penetration rates in South Asia have created opportunities for digital finance services such as mobile wallets, consumer finance and mobile payments for a population that is largely unbanked and underbanked as well as digital media services like streaming and gaming. Southeast Asia: SEA represents relatively more mature markets with higher income levels and more developed infrastructure as compared to MENA, SSA and SA, including higher e-commerce spending and significant time spent online by the high proportion of young population. This has led to an explosion of new media and gaming companies alongside more mature e-commerce, internet infrastructure, classifieds and other specialized players. Middle East and North Africa With a population of approximately 508 million and a nominal GDP of approximately $4.32 trillion in 2023, MENA includes Morocco, Algeria, Tunisia, Libya and Egypt in North Africa. It also includes the GCC countries, comprised of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE, Iraq, and the Levantine nations of Syria, Lebanon, and Jordan. We believe the growth of e-commerce in MENA has further shed light on the necessity of hard and soft infrastructure to support its growth. In particular, cash on delivery is today approximately 60% of all e-commerce transaction in MENA. MasterCard finds that post-COVID consumers in MENA are 95% more likely to consider using an emerging payment method including cryptocurrency, biometrics, contactless or QR codes in the future. We believe there are opportunities for companies to address payments, logistics, and deliveries. For these reasons, we believe there are significant market opportunities in these segments. Sub-Saharan Africa With a population of 1.26 billion, and a nominal GDP of approximately $2.04 trillion in 2023, we believe Africa will be a major future economic source and a driver of global growth. GDP grew by 4% per year between 2010 and 2019, more than twice that of the EU-28 (1.7%) and Latin America (1.7%) over the same period. We believe African demographics are arguably the best in the world, with population growth to grow by 87% between 2020 and 2050 and reach 2.5 billion. By 2025, 45% of all Africans will be urbanized. As of 2020, consumers in Africa s large metropolitan areas spent 79% more than national averages on goods and services. 11 Table of Contents In particular, collective findings by Google and the IFC indicate that the region s internet economy has the potential to contribute $180 billion to Africa s economy by 2025, and estimates that Africa s internet gross domestic product may rise to $712 billion by 2050. Despite the setback from COVID-19, we believe the resilience of the internet economy, coupled with private consumption, strong developer talent, public and private investment, investments in digital infrastructure, and new government policies and regulations will continue to drive this growth in Africa. South Asia With a population of 419 million and a nominal GDP of approximately $775 billion as of 2023, the economies of Pakistan and Bangladesh have sizable populations and have demonstrated fast economic growth. In particular, Bangladesh has grown its GDP in excess of 7% per annum since 2014. Smartphone penetration in Pakistan has grown to nearly 98 million subscribers, or 6.5 times since 2013 as shown by the Pakistan Telecom Authority. According to the Bangladesh Bureau of Statistics, Bangladesh has over 89.9% smartphone penetration as of 2022. As mobile adoption in both Pakistan and Bangladesh switches from 3G and 4G to 5G, we believe there will be tremendous opportunities as the share of people online grows. In particular, we believe South Asia presents tremendous market opportunities for new economy companies. Southeast Asia With a population of 678 million and a nominal GDP of approximately $3.9 trillion in 2023, we believe the Association of Southeast Asian Nations, or ASEAN, made up of countries in Southeast Asia including Indonesia, Thailand, Singapore, Vietnam, the Philippines, Malaysia, Brunei Darussalam, Myanmar, Cambodia and Laos) will become a major regional economic force and a driver of global growth. ASEAN remains one of the fastest growing regions in the world with most economies seeing growth of 5% or more per annum and according to estimates by ASEAN, and will become the fourth-largest economy in the world by 2030 after the United States, China, and the European Union. With approximately 480 million internet users in the region, of which nearly half connect to the internet primarily through their mobile phones, Southeast Asia boasts one of the most engaged mobile internet audiences in the world. In addition, with the number of people aged 15 to 35 projected to reach 218 million by 2030, Southeast Asia s internet economy is experiencing rapid growth, with projections to reach $1 trillion by 2030. This growth is fueled by a young, tech-savvy population, increasing smartphone adoption, and a burgeoning middle class. In addition, we believe the Southeast Asian region presents market opportunities in the financial sector given the gap between needs of the populace and the volume of electronic payment and transfer volumes. We believe that this gap coupled with low insurance penetration in these markets create significant market opportunities in these segments. We also believe that there are not many funding sources for middle and late-stage fundraising in the Southeast Asian consumer internet space, which we believe provides potential opportunities. Our Business Strategy Our business strategy consists of identifying and completing a business combination with one or more businesses or entities within Frontier Growth Markets, underpinned by an ESG mandate to create long-term value for our shareholders. We believe our management team and directors experience and local contacts are differentiated and will enable us to successfully identify and execute an initial business combination. We plan to leverage CIM and our management team and directors extensive network of relationships, ranging from senior management teams at public and private companies and advisors with connections to Frontier Growth Markets, to assist in the sourcing of potential targets for our initial business combination. Neither Meteora nor CIM is being compensated by us for the general diligence, administrative, and advisory support it will provide in the sourcing of potential targets for our initial business combination or in its general role as advisor. 12 Table of Contents We believe our team s strong network and differentiated expertise will help us execute on our business strategy: Local knowledge and connections: Our management team has more than 80 years of combined experience investing in Frontier Growth Markets. At various times some members of our management team have lived and worked in certain markets we are targeting, which has enabled them to create professional and social networks. These relationships span the financial, corporate, legal, and political sectors. We believe their relationships and local knowledge will give our company credibility with businesses within Frontier Growth Markets and help aid in thorough company vetting and due diligence processes. Global platform and resources: Our management team will leverage CIM s international investment platform to help identify, evaluate and perform comprehensive due diligence on companies in connection with the business combination. In addition, Consilium s network of portfolio companies and advisors may be able to help a potential target expand and grow within Frontier Growth Markets. Experience with complex and unique situations: Our team has experience executing complex transactions and navigating complicated regulatory environments. We believe this expertise will enable our management team to structure and execute an attractive cross-border transaction. We expect to be a long-term partner to the post-merger entity and to work together with the management team to assist in the transition to a U.S.-listed company and drive long-term growth. We believe our global investment platform, deep local relationships within Frontier Growth Markets, and commitment to ESG initiatives differentiate us as a value-add partner for a leading Frontier Growth Markets company. Focus on ESG investing: CIM is a signatory to the UN Principles of Responsible Investing, the Intentional Endowments Network, and a member of the Emerging Market Investors Alliance, an industry group for responsible investing in Emerging Markets. Our management will be guided by ESG principles when evaluating potential targets and will seek to enhance them in the chosen company. Our Investment Criteria Consistent with our strategy, we have identified the following characteristics and guidelines that we believe are important in evaluating potential target businesses or entities. We intend to use these criteria and guidelines in assessing acquisition opportunities, but we may decide to enter into our initial business combination with one or more businesses or entities that does not meet these criteria and guidelines. We intend to pursue an initial business combination with companies that have the following attributes: Operations in the new economy sectors across our target markets. We believe that disruptive new economy companies benefit from highly favorable macroeconomic trends in our target markets. These trends are in their infancy, and we believe they have headroom for expansion and growth which makes investing in these sectors attractive. Established business models. Most of our target businesses will have models that we believe are well established in their home and core markets with relevant localization by market and established paths to profitable growth. In addition, we will seek a business that we believe has a sustainable competitive advantage as a result of differentiated de-risked business model, strong technology component, brand recognition and marketing capabilities or any other characteristics that are difficult to replicate. 13 Table of Contents Sector leading KPIs and unit economics. We will seek to merge with a company with critical mass that enjoys sustainable unit economics in its sector. We believe that healthy growth must be supported by strong sector KPIs steering the Company in the right direction to drive profitability and free cash flow generation. Scalability. We seek to invest in a business with a scalable platform and operations to take advantage of growth opportunities, including through geographical expansion and synergistic acquisitions. We intend to leverage our experience in scaling businesses in order to help accelerate growth. Underpenetrated and growing total addressable market. Based on our prior research and personal experience, we believe Frontier Growth Markets present a significant opportunity to invest in companies which serve an underpenetrated total addressable market. These countries hold significant potential due to their geographical size, favorable population trends and the emergence of a middle-class in certain countries. Strong management team and culture. We will look to partner with a passionate, experienced management team that is capable of scaling a business. We will also evaluate ways to support the team in its transition to becoming a U.S.-listed company and beyond. Market leadership. We will seek to combine with a company with a leading position in its geography, market share, volume, technology, product capabilities, or other attributes across an industry or segment, significant barriers to entry and a sustainable competitive advantage. Attractive valuation. We believe that valuations of some companies in Frontier Growth Markets are discounted relative to U.S. peers. We look to seek an acquisition of a company that has potential to grow valuation levels in line with its global peers. Focus on ESG and social empowerment. We will look for companies focused on making a positive impact across a variety of ESG themes within Frontier Growth Markets, as well as on a larger scale. Prior SPAC Experience Below are the SPAC business combinations in which members of our management team (excluding our advisor) have participated, along with certain other information: SPAC (CSLM Acquisition Corp.), Target (Fusemachines Inc.). CSLM Acquisition Corp. consummated its IPO on January 13, 2022 for 16,500,000 units, with each unit consisting of one share of common stock, one right, and one-half of one redeemable warrant, at $10.00 per unit, generating gross proceeds of $165,000,000. The underwriters exercised their over-allotment option in full for an additional 2,475,000 units, resulting in total gross proceeds of $189,759,000. On January 23, 2024, CSLM entered into a definitive agreement with Fusemachines Inc. SPAC (GSR II Meteora Acquisition Corp.), Target (Bitcoin Depot Inc.). GSR II Meteora Acquisition Corp. completed its IPO on February 25, 2022 for 27,500,000 units, with each unit consisting of one share of Class A common stock, one right, and one redeemable warrant, at $10.00 per unit, generating gross proceeds of $275,000,000. On June 30, 2023, GSR II Meteora completed its business combination with Bitcoin Depot Inc., which now trades on NASDAQ under the symbol "BTM". The price of the common stock has ranged from $1.00 to $6.50 following consummation of the business combination. SPAC (Investcorp Europe Acquisition Corp I), Target (Nexx HoldCo, LLC / NexxBuild). Investcorp Europe Acquisition Corp I completed its IPO on December 17, 2021 for 34,500,000 units, with each unit consisting of one Class A ordinary share and one-half of one redeemable warrant, at $10.00 per unit, generating gross proceeds of $345,000,000. On May 27, 2025, Investcorp Europe Acquisition Corp I announced a definitive business combination agreement with Nexx HoldCo, LLC (NexxBuild). 14 Table of Contents SPAC (Haymaker Acquisition Corp.), Target (OneSpaWorld Holdings Limited). Haymaker Acquisition Corp. consummated its IPO on October 26, 2017 for 30,000,000 units, with each unit consisting of one share of common stock and one-half of one redeemable warrant, at $10.00 per unit, generating gross proceeds of $300,000,000. The underwriters partially exercised their over-allotment option in for an additional 3,000,000 units, resulting in total gross proceeds of $330,000,000. Haymaker closed its merger with OneSpaWorld Holdings Limited on March 19, 2019. OneSpaWorld trades on NASDAQ under the symbol "OSW", and the price of the common stock has ranged from $2.60 to $22.5 following consummation of the business combination. SPAC (Haymaker Acquisition Corp. II), Target (ARKO Holdings Ltd.). Haymaker Acquisition Corp. II completed its IPO on June 7, 2019 for 40,250,000 units, with each unit consisting of one share of common stock and one-third of one redeemable warrant, at $10.00 per unit, generating gross proceeds of $402,500,000. The merger with ARKO Holdings Ltd. closed on December 22, 2020. ARKO Holdings trades on NASDAQ under the symbol "ARKO", and the price of the common stock has ranged from $3.75 to $10.75 following consummation of the business combination SPAC (Haymaker Acquisition Corp. III), Target (Biote Holdings, LLC). Haymaker Acquisition Corp. III consummated its IPO on March 4, 2021 for 30,000,000 units, with each unit consisting of one share of common stock and one-fourth of one redeemable warrant, at $10.00 per unit, generating gross proceeds of $300,000,000. The underwriters partially exercised their over-allotment option in for an additional 1,750,000 units, resulting in total gross proceeds of $317,500,000. The merger with Biote Holdings, LLC closed on May 26, 2022. Biote Holdings trades on NASDAQ under the symbol "BTMD", and the price of the common stock has ranged from $3.00 to $8.15 following consummation of the business combination. SPAC (Haymaker Acquisition Corp. IV). Haymaker Acquisition Corp. IV filed a registration statement on Form S-1 with the SEC on February 24, 2022; however, the registration statement was not declared effective, no securities were issued or sold thereunder, and the registration statement was subsequently withdrawn on December 13, 2022. SPAC (Haymaker Acquisition Corp. 4). Haymaker Acquisition Corp. 4 ("Haymaker 4") consummated its IPO on July 26, 2023 for 20,000,000 units, with each unit consisting of one share of common stock and one-half of one redeemable warrant, at $10.00 per unit, generating gross proceeds of $200,000,000. The underwriters fully exercised their over-allotment option in for an additional 3,000,000 units, resulting in total gross proceeds of $230,000,000. In early 2025, Haymaker 4 entered into a non-binding letter of intent for a potential business combination with an infrastructure materials company. A definitive agreement has not yet been signed. SPAC (Roth CH Acquisition Co.) Roth CH Acquisition Co. consummated its initial public offering on November 1, 2022, issuing 20,000,000 units at $10.00 per unit, with each unit consisting of one share of common stock and one half of one redeemable warrant. The underwriters exercised their over-allotment option in full for an additional 3,000,000 units, resulting in total gross proceeds of $230,000,000. In April 2024, the company voluntarily delisted its Class A Ordinary Shares, Units, and Warrants from the Nasdaq Global Market, returned funds in its trust account to the public shareholders of the company, while also permitting shareholders to retain 10% of their shares. On January 29, 2025, the company announced that it was in the process of completing a business combination with Sharon AI, Inc., business focused on Artificial Intelligence, Cloud GPU Compute Infrastructure, and Data Storage and subsequently filed a Registration Statement on Form S-4 with respect to such transaction in June 2025. 15 Table of Contents SPAC (AF Acquisition Corp.) AF Acquisition Corp. consummated its initial public offering on March 19, 2021, issuing 20,000,000 units at $10.00 per unit, with each unit consisting of one share of common stock and one third of one redeemable warrant. The underwriters partially exercised their over-allotment option for an additional 2,400,000 units, resulting in total gross proceeds of $224,000,000. AF Acquisition Corp. did not complete a business combination and liquidated on December 23, 2022. SPAC (Berto Acquisition Corp.) Berto Acquisition Corp. ("Berto") consummated its initial public offering on April 30, 2025, issuing 26,100,000 units at $10.00 per unit, with each unit consisting of one share of common stock and one half of one redeemable warrant. The underwriters exercised their over-allotment option in full for an additional 3,915,000 units, resulting in total gross proceeds of $300,150,000. Vikas Mittal was appointed as the Chief Financial Officer of Berto Acquisition Corp. on June 13, 2025. Berto is currently seeking a target. Prior SPACs Where Meteora acted as Advisor- SPAC (Globa Terra Acquisition Corp.) Globa Terra Acquisition Corp. filed its Form S-1 on April 16, 2025, proposing an IPO of 15,217,000 million units at $10.00 per unit to raise approximately $152,170,000; each unit comprises one share of Class A common stock, three-fourths of one redeemable warrant and one right to receive one-twentieth (1/20) of an ordinary share. Globa Terra Acquisition Corp. has not yet completed its IPO. SPAC (GigCapital7 Corp.) GigCapital 7 Corp. consummated its initial public offering on August 29, 2024, issuing 20,000,000 units at $10.00 per unit, with each unit consisting of one class A ordinary share and one redeemable warrant. GigCapital7 Corp. is currently seeking a target. SPAC (GigCapital5, Inc.) GigCapital5, Inc. consummated its initial public offering on September 24, 2021, issuing 20,000,000 units at $10.00 per unit, with each unit consisting of one share of common stock and one redeemable warrant. The underwriters exercised their over-allotment option in full for an additional 3,000,000 units, resulting in total gross proceeds of $230,000,000. GigCapital5, Inc. closed its merger with QT Imaging, Inc. on March 4, 2024. QT Imaging Holdings, Inc. trades on the OTC under the symbol "QTIH", and the price of the common stock has ranged from $0.30 to $5.00 following consummation of the business combination. SPAC (EGH Acquisition Corp.) EGH Acquisition Corp. consummated its initial public offering on May 9, 2025, issuing 15,000,000 units at $10.00 per unit, with each unit consisting of one class A ordinary share and one right to receive one tenth (1/10) of a Class A ordinary share. EGH Acquisition Corp. is currently seeking a target. However, in recent years, a number of target businesses have underperformed financially post-business combination with a SPAC. As a result, we cannot assure you that we will properly ascertain or assess all of the significant risk factors associated with a target business or that the price of the shares of the combined entity post-business combination will increase. Our Acquisition Process In evaluating a prospective target business, we expect to conduct a due diligence review which may encompass, among other things, meetings with incumbent management and employees, document reviews, interviews of customers and suppliers, inspection of facilities, as applicable, as well as a review of financial, operational, legal and other information about the target and its industry which will be made available to us. If we determine to move forward with a particular target, we will proceed to structure and negotiate the terms of the business combination transaction. 16 Table of Contents The time required to select and evaluate a target business and to structure and complete our initial business combination, and the costs associated with this process, are not currently ascertainable with any degree of certainty. Any costs incurred with respect to the identification and evaluation of, and negotiation with, a prospective target business with which our initial business combination is not ultimately completed will result in our incurring losses and will reduce the funds available for us to use to complete another business combination. Our ability to identify and evaluate a target company may be impacted by significant competition among other SPACs in pursuing a business combination transaction candidate and the significant competition may impact the attractiveness of the acquisition terms that we will be able to negotiate. We have not selected any business combination target, and we have not, nor has anyone on our behalf, initiated any substantive discussions, directly or indirectly, with any business combination target. Our Sponsor and directors and officers are, or may in the future become, affiliated with entities that are engaged in a business similar to ours. These entities may compete with us for acquisition opportunities. If these entities decide to pursue any such opportunity, we may be precluded from pursuing such opportunities. Subject to his or her fiduciary duties under Cayman Islands law, none of the members of our management team have any obligation to present us with any opportunity for a potential business combination of which they become aware. Our management team, in their capacities as directors, officers or employees of our Sponsor or its affiliates or in their other endeavors (including other special purpose acquisition companies), may choose to present potential business combinations to the related entities described above, current or future entities affiliated with or managed by our Sponsor, or third parties, before they present such opportunities to us, subject to his or her fiduciary duties under Cayman Islands law and any other applicable fiduciary duties. Our directors and officers presently have, and any of them in the future may have, additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity. Accordingly, if any of our directors or officers becomes aware of a business combination opportunity that is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she may need to honor these fiduciary or contractual obligations to present such business combination opportunity to such entity, or in the case of a non-compete restriction, may not present such opportunity to us at all, subject to his or her fiduciary duties under Cayman Islands law. Our directors and officers are also not required to commit any specified amount of time to our affairs, and, accordingly, will have conflicts of interest in allocating management time among various business activities, including identifying potential business combinations and monitoring the related due diligence. For example, Mr. Binder is the co-Founder of CIM and Chief Investment Officer and Portfolio Manager for CIM and Mr. Cassel is the co-Founder and Chief Executive Officer of CIM. CIM is an SEC-registered investment management firm, and each of Mr. Binder and Mr. Cassel owes fiduciary duties to CIM. In addition, certain of our officers and directors are officers and directors of CSLM Acquisition Corp. (Nasdaq: CSLM), a special purpose acquisition company focused on new economy sectors. Our Sponsor and directors and officers are also not prohibited from Sponsoring, investing or otherwise becoming involved with, any other blank check companies, including in connection with their initial business combinations, prior to us completing our initial business combination. Any other special purpose acquisition company may also have terms that are the same or different than our terms, including terms that are more favorable to its investors and/or potential target businesses. Moreover, entities in which our directors and officers are affiliated with may enter into agreements or other arrangements with businesses, which agreements or arrangements may limit or restrict our ability to enter into a business combination with such business. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and us, on the other. In addition, our amended and restated memorandum and articles of association will contain provisions to exculpate and indemnify, to the maximum extent permitted by law, such persons in respect of any liability, obligation or duty to the Company that may arise as a consequence of such persons becoming aware of any business opportunity or failing to present such business opportunity. We do not believe, however, based on the other companies with which our directors and officers are affiliated and their respective businesses, that the fiduciary duties or contractual obligations of our directors or officers will materially affect our ability to identify and pursue business combination opportunities or complete our initial business combination. See "Risk Factors — Risks Related to our Team and Their Respective Affiliates and to the Post-Business Combination Company — Certain of our directors and officers are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented." 17 Table of Contents Our Sponsor is managed by its two directors, Charles T. Cassel III and Vikas Mittal and is beneficially owned (i) 51% by Samara CSLM LLC and (ii) 49% by Consilium Investment Capital Inc. Consilium Investment Capital Inc. is legally and beneficially owned 50% by Mr. Cassel and 50% by Mr. Binder. Samara CSLM LLC, a Delaware limited liability company, is legally and beneficially owned solely by Vikas Mittal and his immediate family (Vik Mittal is also the Managing Member and Chief Investment Officer of Meteora). The economic interests of our Sponsor are currently 100% owned by Samara CSLM LLC and Consilium Investment Capital Inc. As a result, Mr. Cassel, Mr. Binder, and Mr. Mittal may exert a substantial influence on other actions requiring a shareholder vote, potentially in a manner that you do not support, including the appointment and removal of our directors, amendments to our amended and restated memorandum and articles of association and approval of major corporate transactions. If our Sponsor purchases any Class A ordinary shares in this offering or in the aftermarket or in privately negotiated transactions, this would increase their influence over such actions. See "Risk Factors — Risks Related to our Team and Their Respective Affiliates and to the Post-Business Combination Company". Consilium and Meteora may become aware of a potential business combination opportunity that may be an attractive opportunity for our Company. Consilium, Meteora, and our Company may each assess opportunities within Frontier Growth Markets. In particular, CIM manages two products targeted at Frontier Growth Markets. The Fund focuses on listed equities opportunities within Frontier Growth Markets. EOF focuses on less liquid opportunities within Frontier Growth Markets, and targets a three-year time horizon to extract value from companies that are relatively unknown. Meteora is an investment adviser specializing in SPAC-related investments. Neither Meteora nor Consilium is under any obligation to source any potential opportunities for our initial business combination or refer any such opportunities to our Company or provide any other services to our Company. Meteora and Consilium s role with respect to our Company is expected to be advisory in nature. Consilium may have fiduciary and/or contractual duties to its investment vehicles and to companies in which Consilium has invested. Similarly, Meteora may have fiduciary and/or contractual duties to its clients and to companies in which Meteora has invested. As a result, Consilium and Meteora may each have a duty to offer business combination opportunities to certain Consilium funds, other investment vehicles or other entities before other parties, including our Company. Additionally, certain companies in which Consilium or Meteora has invested may enter into transactions with, provide goods or services to, or receive goods or services from an entity with which we seek to complete our initial business combination. Transactions of these types may present a conflict of interest because Consilium may directly or indirectly receive a financial benefit as a result of such transaction. We believe that any such potential conflicts of interest of Consilium and Meteora will be naturally mitigated by the differing nature of targets that Consilium and Meteora typically considers most attractive for its activities and the types of initial business combination opportunities that we expect to be most attractive for our Company. Our advisory board members are not under any obligation to source any potential opportunities for our initial business combination or refer any such opportunities to our Company or provide any other services for our Company. Such advisors roles with respect to our Company are expected to be advisory in nature. Our advisory board members may have fiduciary and/or contractual duties to certain companies but do not have any fiduciary obligations to our Company. As a result, our advisory board members may have a duty to offer business combination opportunities to certain other companies before our Company. Additionally, certain companies affiliated with our advisory board members may enter into transactions with, provide goods or services to, or receive goods or services from an entity with which we seek to complete our initial business combination. Transactions of these types may present a conflict of interest because our advisory board members may directly or indirectly receive a financial benefit as a result of such transaction. See "Risk Factors — Risks Related to our Team and Their Respective Affiliates and to the Post-Business Combination Company — Our advisory board members are not under any obligation to source any potential opportunities for our initial business combination or refer any such opportunities to our Company or provide any other services for our Company." Past experience or performance of our team and our advisory board and their respective affiliates is not a guarantee of either (1) our ability to successfully identify and execute a transaction or (2) success with respect to any business combination that we may consummate. You should not rely on the historical record of our team or our advisory board or their respective affiliates as indicative of future performance. See "Risk Factor — Past performance of Consilium, Meteora, our team and their respective affiliates may not be indicative of future performance of an investment in the Company." No member of our management team has any experience operating a special purpose acquisition company. We do not believe, based on the other companies with which our directors and officers are affiliated and their respective businesses, that the fiduciary, contractual or other obligations or duties of our officers or directors will materially affect our ability to complete our initial business combination. 18 Table of Contents The following table sets forth the payments to be received by our Sponsor and its affiliates from us prior to or in connection with the completion of our initial business combination and the securities issued and to be issued by us to our Sponsor or its affiliates: Entity/Individual Amount of Compensation to be Received or Securities Issued or to be Issued Consideration Paid or to be Paid CSLM Acquisition Sponsor II, Ltd $30,000 per month Office space, administrative and shared personnel support services CSLM Acquisition Sponsor II, Ltd 7,666,667 Class B Ordinary Shares* $25,000 500,000 Private Units to be purchased simultaneously with the closing of this offering (or 575,000 Private Units if the underwriter s over-allotment option is exercised in full) $5,000,000 (or $5,750,000 if the underwriter s over-allotment option is exercised in full) Up to $300,000 Repayment of loans made to us to cover offering related and organizational expenses. Up to $1,500,000 in working capital loans, which loans may be convertible into units of the post-business combination entity at a price of $10.00 per unit Working capital loans to finance transaction costs in connection with an initial business combination Reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination Services in connection with identifying, investigating and completing an initial business combination * Pursuant to a Securities Transfer Agreement, our Sponsor has transferred 20,000 founder shares (or 100,000 in the aggregate) to each of the Company s director nominees, Christopher Bradley, Brian Rudick, Mathew August, Danel Calvillo Armendariz and Dr. Jim Kyung Soo Liew, for the sum of $0.003 per share, following which transfer our Sponsor holds an aggregate of 7,566,667 founder shares. Because our Sponsor (and pursuant to the Securities Transfer Agreement, each of the Company s director nominees, Christopher Bradley, Brian Rudick, Mathew August, Danel Calvillo Armendariz and Dr. Jim Kyung Soo Liew) acquired the founder shares at a nominal price ($0.003 per share), our public shareholders will incur immediate and substantial dilution upon the closing of this offering, assuming no value is ascribed to the warrants included in the units. Further, the Class A ordinary shares issuable in connection with the conversion of the founder shares (including those issued in connection with an increase in the size of the offering) may result in material dilution to our public shareholders due to the anti-dilution rights of our founder shares that may ultimately result in an issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion. Additionally, our public shareholders may experience dilution from the exercise of the 387,500 private warrants (408,125 private warrants if the underwriter s over-allotment option is exercised in full) that compose part of the private units to be purchased by our Sponsor simultaneously with the closing of this offering as well as conversion of any working capital loans into units, if elected by the Sponsor or by another person or entity who made such working capital loans. The exercise of the private warrants that compose part of the private units would cause the actual dilution to the public shareholders to be higher, particularly where a cashless exercise for warrants is utilized. See the sections titled "Risk Factors — Risks Relating to our Securities — The nominal purchase price paid by our Sponsor for the founder shares may result in significant dilution to the implied value of your public shares upon the consummation of our initial business combination, and our Sponsor is likely to make a substantial profit on its investment in us in the event we consummate an initial business combination, even if the business combination causes the trading price of our ordinary shares to materially decline" and "Dilution." Status as a Public Company After this offering, we believe our structure will make us an attractive business combination partner to prospective target businesses. As a publicly traded company, we will offer a target business an alternative to the traditional initial public offering. We believe that target businesses will favor this alternative, which we believe is less expensive, while offering greater certainty of execution than a traditional initial public offering. During an initial public offering, there are typically expenses incurred in marketing, which would be costlier than a business combination with us. Furthermore, once a proposed business combination is approved by our shareholders (if applicable) and the transaction is consummated, the target business will have effectively become public, whereas an initial public offering is always subject to the underwriter s ability to complete the offering, as well as general market conditions that could prevent the offering from occurring. Once public, we believe the target business would have greater access to capital and additional means of creating management incentives that are better aligned with shareholders interests than it would as a private company. It can offer further benefits by augmenting a company s profile among potential new customers and vendors and aid in attracting talented management. 19 Table of Contents Initial Business Combination We are not presently engaged in, and we will not engage in, any operations for an indefinite period of time following this offering. We intend to effectuate our initial business combination using cash from the proceeds of this offering and the private placement of the private units, the proceeds of the sale of our shares in connection with our initial business combination (including pursuant to forward purchase agreements or backstop agreements we may enter into following the consummation of this offering or otherwise), shares issued to the owners of the target, debt issued to bank or other lenders or the owners of the target, other securities issuances, or a combination of the foregoing. We may seek to complete our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, which would subject us to the numerous risks inherent in such companies and businesses. We will either (1) seek shareholder approval of our initial business combination at a meeting called for such purpose at which shareholders may seek to convert their shares, regardless of whether they vote for or against the proposed business combination, into their pro rata share of the aggregate amount then on deposit in the trust account, including interest earned thereon (which interest shall be net of taxes payable), or (2) provide our shareholders with the opportunity to sell their shares to us by means of a tender offer (and thereby avoid the need for a shareholder vote) for an amount equal to their pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable, if any), in each case subject to the limitations described herein. The decision as to whether we will seek shareholder approval of our proposed business combination or allow shareholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek shareholder approval. Unlike other blank check companies which require shareholder votes and conduct proxy solicitations in conjunction with their initial business combinations and related conversions of public shares for cash upon consummation of such initial business combinations even when a vote is not required by law, we will have the flexibility to avoid such shareholder vote and allow our shareholders to sell their shares pursuant to the tender offer rules of the SEC. In that case, we will file tender offer documents with the SEC, which will contain substantially the same financial and other information about the initial business combination as is required under the SEC s proxy rules. We will consummate our initial business combination only, if we seek shareholder approval, the affirmative vote of the holders of a majority of Class A ordinary shares that are voted at a shareholder meeting held to consider the initial business combination. We will have until 24 months from the closing of this offering or until such earlier liquidation date as our board of directors may approve to consummate an initial business combination. If we anticipate that we may be unable to consummate our initial business combination within such 24-month period, we may seek shareholder approval to amend our amended and restated memorandum and articles of association to extend the date by which we must consummate our initial business combination. Subject to shareholder approval, there are no limitations as to the duration of an extension or the number of times the completion window may be extended by shareholders via an amendment to our amended and restated memorandum and articles of association. If we seek shareholder approval for an extension, holders of public shares will be offered an opportunity to redeem their shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (less income taxes payable), divided by the number of then issued and outstanding public shares, subject to applicable law. If we are unable to consummate an initial business combination within such time period, and do not hold a shareholder vote to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to consummate an initial business combination, or by such earlier liquidation date as our board of directors may approve, from the closing of this offering, we will, as promptly as reasonably possible but not more than 10 business days thereafter, redeem 100% of the outstanding public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including any interest earned on the funds held in the trust account and net of interest that may be used by us to cover permitted withdrawals and up to $100,000 of interest to pay dissolution expenses, divided by the number of then outstanding public shares, which redemption will completely extinguish the public shareholders rights as shareholders (including the right to receive further liquidating distributions, if any), subject to applicable law and as further described herein, and then seek to dissolve and liquidate. We expect the pro rata redemption price to be approximately $10.00 per Class A ordinary share (regardless of whether or not the underwriter exercises its over-allotment option), without taking into account any interest earned on such funds. However, we cannot assure you that we will in fact be able to distribute such amounts as a result of claims of creditors, which may take priority over the claims of our public shareholders. 20 Table of Contents If we do not complete our initial business combination within the completion window, while we do not currently intend to seek shareholder approval to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to consummate an initial business combination, we may elect to do so in the future. There is no limit on the number of extensions that we may seek; however, we do not expect that it will be necessary to extend the time period to consummate our initial business combination beyond 36 months from the closing of this offering. If we determine not to or are unable to extend the time period to consummate our initial business combination or fail to obtain shareholder approval to extend the completion window, our Sponsor s investment in our founder shares and our private units will be worthless. Our initial business combination must occur with one or more target businesses that together have a fair market value of at least 80% of the assets held in the trust account (excluding any taxes payable on interest earned) at the time of the agreement to enter into the initial business combination. The fair market value of the target or targets will be determined by our Board of Directors based upon one or more standards generally accepted by the financial community (such as actual and potential sales, earnings, cash flow and/or book value). Even though our Board of Directors will rely on generally accepted standards, our Board of Directors will have discretion to select the standards employed. In addition, the application of the standards generally involves a substantial degree of judgment. Accordingly, investors will be relying on the business judgment of the Board of Directors in evaluating the fair market value of the target or targets. The proxy solicitation materials or tender offer documents used by us in connection with any proposed transaction will provide public shareholders with our analysis of the fair market value of the target business, as well as the basis for our determinations. If our Board of Directors is not able independently to determine the fair market value of the target business or businesses, we may, in our sole discretion, obtain an opinion from an independent investment banking firm, or another independent entity that commonly renders valuation opinions on the type of target business we are seeking to acquire, with respect to the satisfaction of such criteria. While we consider it likely that our board of directors will be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of the target s assets or prospects. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. However, unless we consummate our initial business combination with an affiliated entity, our Board of Directors is not required to obtain an opinion from an independent investment banking firm or another independent entity that the price we are paying is fair to our shareholders from a financial point of view. As described below adjacent to the caption "—The Offering — Offering proceeds to be held in the trust account," the Nasdaq rules provide that at least 90% of the gross proceeds from this offering and the sale of the units be deposited in a trust account. Of the net proceeds we will receive from this offering and the sale of the private units described in this prospectus, $200,000,000, or $230,000,000 if the underwriter s over-allotment option is exercised in full ($10.00 per unit in either case), will be placed in a U.S. based trust account with Continental Stock Transfer & Trust Company acting as trustee, and initially be invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations; the holding of these assets in this form is intended to be temporary and for the sole purpose of facilitating the intended business combination We currently anticipate structuring a business combination to acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination where we merge directly with the target business or where we acquire less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the "Investment Company Act"). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock of a target. In this case, we could acquire a 100% controlling interest in the target; however, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% fair market value test, as described above. 21 Table of Contents We are not prohibited from pursuing an initial business combination with a company that is affiliated with our Sponsor, officers or directors or non-managing Sponsor investors, or completing the business combination through a joint venture or other form of shared ownership with our Sponsor, officers or directors or non-managing Sponsor investors. In the event we seek to complete our initial business combination with a company that is affiliated (as defined in our amended and restated memorandum and articles of association) with our Sponsor (including its members), officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions, stating that the consideration to be paid by us in such an initial business combination is fair to our Company from a financial point of view. We are not required to obtain such an opinion in any other context. Members of our management team and our independent directors will directly or indirectly own founder shares and/or private units following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. The low price that our Sponsor, executive officers and directors (directly or indirectly) paid for the founder shares creates an incentive whereby our officers and directors could potentially make a substantial profit even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. If we are unable to complete our initial business combination within 24 months from the closing of this offering (as may be extended by shareholder approval to amend our amended and restated memorandum and articles of association to extend the date by which we must consummate our initial business combination), or by such earlier liquidation date as our board of directors may approve, the founder shares and private units may expire worthless, except to the extent they receive liquidating distributions from assets outside the trust account, which could create an incentive for our Sponsor, executive officers and directors to complete a transaction even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such other entity, subject to their fiduciary duties under Cayman Islands law. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by law: (i) no individual serving as a director or an officer, among other persons, shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us, and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which (a) may be a corporate opportunity for any director or officer, on the one hand, and us, on the other or (b) the presentation of which would breach an existing legal obligation of a director or officer to any other entity. As a result, the fiduciary duties or contractual obligations of our officers or directors could materially affect our ability to complete our initial business combination. In addition, our Sponsor and our officers and directors may Sponsor or form other special purpose acquisition companies similar to ours or may pursue other business or investment ventures during the period in which we are seeking an initial business combination. As a result, our Sponsor, officers and directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other special purpose acquisition company with which they may become involved. Any such companies, businesses or investments may present additional conflicts of interest in pursuing an initial business combination target, which could materially affect our ability to complete our initial business combination. Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. 22 Table of Contents Competition In identifying, evaluating and selecting a target business for our initial business combination, we may encounter significant competition from other entities having a business objective similar to ours (including other special purpose acquisition companies, private equity groups and leveraged buyout funds, public companies and operating businesses seeking strategic acquisitions), which competition may impact the attractiveness of the acquisition terms that we will be able to negotiate. Many of these entities are well-established and have extensive experience identifying and effecting business combinations directly or through affiliates. Moreover, many of these competitors possess financial, technical, human and other resources that are similar to or greater than us. Our ability to acquire larger target businesses will be limited by our available financial resources. This inherent limitation gives others an advantage in pursuing the acquisition of a target business. Furthermore, our obligation to pay cash in connection with the exercise of redemption rights by our public shareholders may reduce the resources available to us for our initial business combination and our issued and outstanding warrants, and the future dilution they potentially represent, may not be viewed favorably by certain target businesses. Either or both of these factors may place us at a competitive disadvantage in successfully negotiating an initial business combination. See "Risk Factors — Because of our limited resources and the significant competition for business combination opportunities, it may be more difficult for us to complete our initial business combination. If we are unable to complete our initial business combination, our public shareholders may receive only their pro rata portion of the funds in the trust account that are available for distribution to public shareholders, and our warrants will expire worthless." Potential Additional Financings We may need to obtain additional financing to complete our initial business combination, either because the transaction requires more cash than is available from the proceeds held in our trust account or because we become obligated to redeem a significant number of our public shares upon completion of our business combination, in which case we may issue additional securities or incur debt in connection with such business combination. If we raise additional funds through equity or convertible debt issuances, our public shareholders may suffer significant dilution, and these securities could have rights that rank senior to our public shares. If we raise additional funds through the incurrence of indebtedness, such indebtedness would have rights that are senior to our equity securities and could contain covenants that restrict our operations. Further, as described above, due to the anti-dilution rights of our founder shares, our public shareholders may incur material dilution. In addition, we intend to target businesses with enterprise values that are greater than we could acquire with the net proceeds of this offering and the sale of the private units, and, as a result, if the cash portion of the purchase price exceeds the amount available from the trust account, net of amounts needed to satisfy any redemptions by public shareholders, we may be required to seek additional financing to complete such proposed initial business combination. We may also obtain financing prior to the closing of our initial business combination to fund our working capital needs and transaction costs in connection with our search for and completion of our initial business combination. There is no limitation on our ability to raise funds through the issuance of equity or equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements or backstop agreements we may enter into following consummation of this offering. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our initial business combination. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to liquidate the trust account. In addition, following our initial business combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations. Company Status and Other Information We are an "emerging growth company," as defined in Section 2(a) of the Securities Act of 1933, as amended (the "Securities Act"), as modified by the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act"). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act"), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. 23 Table of Contents In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that is held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to "emerging growth company" will have the meaning associated with it in the JOBS Act. Additionally, we are a "smaller reporting company" as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates exceeds $250 million as of the prior June 30th, and (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates exceeds $700 million as of the prior June 30. Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. Pursuant to a letter agreement to be entered with us, each of our Sponsor, directors, and officers has agreed to restrictions on its ability to transfer, assign, or sell the founder shares and private units, as summarized in the table below. Subject Securities Expiration Date Natural Persons and Entities Subject to Restrictions Exceptions to Transfer Restrictions Founder Shares The earlier of (A) six months after the completion of our initial business combination or (B) the date following the completion of our initial business combination on which we complete a liquidation, merger, share exchange or other similar transaction that results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property. CSLM Acquisition Sponsor II, Ltd Charles T. Cassel III Jonathan M. Binder Vikas Mittal Christopher Bradley, Mathew August, Brian Rudick, Danel Calvillo Armendariz and Dr. Jim Kyung-Soo Liew Transfers permitted (a) to our or CCM s officers, directors, advisors or consultants, any affiliate or family member of any of our or CCM s officers, directors, advisors or consultants, any members or partners of the Sponsor or their affiliates and funds and accounts advised by such members or partners, any affiliates of the Sponsor, or any employees of such affiliates, (b) in the case of an individual, as a gift to such person s immediate family or to a trust, the beneficiary of which is a member of such person s immediate family, an affiliate of such person or to a charitable organization; (c) in the case of an individual, by virtue of laws of descent and distribution upon the death of such person; (d) in the case of an individual, pursuant to a qualified domestic relations order; 24 Table of Contents Subject Securities Expiration Date Natural Persons and Entities Subject to Restrictions Exceptions to Transfer Restrictions (e) by private sales or transfers made in connection with any forward purchase agreement or similar arrangement, in connection with an extension of the completion window or in connection with the consummation of a business combination at prices no greater than the price at which the units, shares or warrants were originally purchased; (f) pro rata distributions from our Sponsor or CCM to its respective members, partners or shareholders pursuant to our Sponsor s or CCM s limited liability company agreement or other charter documents; (g) by virtue of the laws of the Cayman Islands or our Sponsor s limited liability company agreement upon dissolution of our Sponsor or upon dissolution of CCM, (h) in the event of our liquidation prior to our consummation of our initial business combination; (i) in the event that, subsequent to our consummation of an initial business combination, we complete a liquidation, merger, share exchange or other similar transaction which results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property or (j) to a nominee or custodian of a person or entity to whom a transfer would be permissible under clauses (a) through (g); provided, however, that in the case of clauses (a) through (g) and clause (j) these permitted transferees must enter into a written agreement agreeing to be bound by these transfer restrictions and the other restrictions contained in the letter agreements. In addition, the formation agreement of our Sponsor provides that its interests may only be transferred to a member s affiliates (which affiliates shall include any member s owners of an equity interest, direct investors, members, or limited partners, as the case may be), immediate family, or to a trust, the primary beneficiary(ies) of which is a member or members of such member s immediate family. Private Units 30 days after the completion of our initial business combination CSLM Acquisition Sponsor II, Ltd Charles T. Cassel III Jonathan M. Binder Vikas Mittal, Christopher Bradley, Mathew August, Brian Rudick, Danel Calvillo Armendariz and Dr. Jim Kyung-Soo Liew Same as above. 25 Table of Contents Subject Securities Expiration Date Natural Persons and Entities Subject to Restrictions Exceptions to Transfer Restrictions Any units, warrants, ordinary shares or any other securities convertible into, or exercisable or exchangeable for, any units, ordinary shares, founder shares, or warrants 180 days from the date of this prospectus CSLM Acquisition Sponsor II, Ltd, Charles T. Cassel III Jonathan M. Binder, Vikas Mittal, Christopher Bradley, Mathew August, Brian Rudick, Danel Calvillo Armendariz and Dr. Jim Kyung-Soo Liew The underwriter in its sole discretion may release any of the securities subject to these lock-up agreements at any time without notice. Our Sponsor, officers and directors are also subject to separate transfer restrictions on their founder shares and private units pursuant to the letter agreement described in the immediately preceding paragraphs. Up to 1,000,000 of the founder shares will be surrendered for no consideration depending on the extent to which the underwriter s over-allotment option is exercised. In addition, in order to facilitate our initial business combination or for any other reason determined by our Sponsor in its sole discretion, our Sponsor may surrender or forfeit, transfer or exchange our founder shares, private units or any of our other securities, including for no consideration, as well as subject any such securities to earn-outs or other restrictions, or otherwise amend the terms of any such securities or enter into any other arrangements with respect to any such securities. We may also issue Class A ordinary shares upon conversion of the founder shares at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions as set forth therein. Corporate Information We are a Cayman Islands exempted company incorporated on July 26, 2024 under the name "CSLM Acquisition Corporation II, Ltd", and re-named "CSLM Digital Asset Acquisition Corp III, Ltd" by special resolution, on May 23, 2025. Our executive offices are located at 2400 E. Commercial Boulevard, Suite 900, Ft. Lauderdale, FL 33308 and our telephone number is (954) 315-9380. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Act. As an exempted company, we have applied for and received a tax exemption undertaking from the Cayman Islands Government that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividends or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. Our corporate website and the information contained on, or that can be accessed through, the website is not deemed to be incorporated by reference in, and is not considered part of, this prospectus or the registration statement of which this prospectus is a part. You should not rely on any such information in making your decision whether to invest in our securities. In addition, after completion of this offering and prior to the consummation of our business combination, only holders of our founder shares will have the right to vote on the appointment and the removal of our directors. As a result, Nasdaq will consider us to be a "controlled company" within the meaning of Nasdaq corporate governance standards. Under Nasdaq corporate governance standards, a company of which more than 50% of the voting power for the appointment and removal of our of directors is held by an individual, group or another company is a "controlled company" and may elect not to comply with certain corporate governance requirements. We currently do not intend to rely on the "controlled company" exemption, but may do so in the future. Accordingly, if we choose to do so, you will not have the same protections afforded to shareholders of companies that are subject to all of the Nasdaq corporate governance requirements. 26 Table of Contents THE OFFERING In making your decision on whether to invest in our securities, you should take into account not only the backgrounds of the members of our management team, but also the special risks we face as a blank check company and the fact that this offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. You will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. You should carefully consider these and the other risks set forth in the section below entitled "Risk Factors." Securities offered 20,000,000 units (or 23,000,000 units if the underwriter s over-allotment option is exercised in full), at $10.00 per unit, each unit consisting of: one Class A ordinary share; and one-half (1/2) of one warrant to purchase one Class A ordinary share at a price of $11.50 per share, subject to adjustment as described in this prospectus. Listing of our securities and proposed symbols We anticipate that the units, as well as the Class A ordinary shares and warrants, underlying the units (once they begin separate trading), will be listed on Nasdaq under the symbols "KOYNU," "KOYN," "and "KOYNW," respectively. Trading commencement and separation of the Class A Ordinary Shares, and Warrants Each of the units, Class A ordinary shares, and warrants may trade separately on the 52nd day after the date of this prospectus unless the underwriter determines that an earlier date is acceptable. In no event will the underwriter allow separate trading of our Class A ordinary shares, and warrants until we file a Current Report on Form 8-K with the SEC with an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering. Once our Class A ordinary shares, and warrants commence separate trading, the holders thereof will have the option to continue to hold units or separate their units into the component securities. Holders will need to have their brokers contact our transfer agent in order to separate the units into Class A ordinary shares, and warrants. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. We will file a Current Report on Form 8-K with the SEC, including an audited balance sheet reflecting our receipt of the gross proceeds at the closing of this offering, promptly upon the closing of this offering, which is anticipated to take place two business days from the date the units commence trading. If the underwriter s over-allotment option is exercised following the initial filing of such Current Report on Form 8-K, a second or amended Current Report on Form 8-K will be filed to provide updated financial information to reflect the exercise of the over- allotment option. We will also include in the initial Current Report, or any amendment thereto or subsequent filing, as applicable, information indicating if the underwriter has allowed separate trading of the Class A ordinary shares, and warrants prior to the 52nd day after the date of this prospectus. 27 Table of Contents Units: Issued and outstanding before this offering: 0 units Number to be sold in private placement simultaneously with this offering: 775,000 Issued and outstanding after this offering and the concurrent private placement: 20,775,000 units(1) Ordinary shares: Issued and outstanding before this offering: 6,666,667 shares(2) Number included in the private units to be sold in a private placement simultaneously with this offering: 775,000 Issued and outstanding after this offering and the concurrent private placement: 27,441,667 shares(3) (1) Assumes no exercise of the underwriter s over-allotment option. (2) Includes 6,666,667 founder shares issued to the Sponsor (assumes the surrender for no consideration of 1,000,000 founder shares if the over-allotment option is not exercised). Founder shares are currently classified as Class B ordinary shares, which shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of a holder on a one-for-one basis, subject to adjustment as described below adjacent to the caption "Conversion of founder shares and anti-dilution rights" and in our amended and restated memorandum and articles of association. (3) Assumes no exercise of the underwriter s over-allotment option, and includes, accordingly, (i) an aggregate of 20,000,000 public shares, (ii) an aggregate of 6,666,667 founder shares purchased by our Sponsor, and (iii) an aggregate of 775,000 private shares underlying 775,000 private units issued to the Sponsor and the underwriter. (4) Assumes no exercise of the underwriter s over-allotment option, and includes, accordingly, (i) 10,000,000 public warrants and (ii) 387,500 private warrants included in 775,000 private units to be purchased by the Sponsor and underwriter concurrently with this offering. 28 Table of Contents Warrants: Outstanding before this offering 0 warrants Number of warrants included in the private units to be sold in a private placement simultaneously with this offering 387,500 Outstanding after this offering and the concurrent private placement 10,387,500 warrants(8) Exercisability Each whole warrant is exercisable for one Class A ordinary share. The warrants may only be exercisable for whole Class A ordinary shares. Exercise price $11.50 per share of Class A ordinary share, subject to adjustment as described in this prospectus. In addition, if (x) we issue additional Class A ordinary shares or equity-linked securities for capital raising purposes in connection with the closing of our initial business combination at an issue price or effective issue price of less than $9.20 per Class A ordinary share (with such issue price or effective issue price to be determined in good faith by our Board of Directors, and in the case of any such issuance to our Sponsor or its affiliates, without taking into account any founder shares held by them prior to such issuance), (y) the aggregate gross proceeds from such issuances represent more than 60% of the total equity proceeds, and interest thereon, available for the funding of our initial business combination on the date of the consummation of our initial business combination (net of redemptions), and (z) the volume weighted average trading price of our Class A ordinary shares during the 20 trading-day period starting on the trading day prior to the day on which we consummate our initial business combination (such price, the "Market Value") is below $9.20 per share, the exercise price of the warrants will be adjusted (to the nearest cent) to be equal to 180% of the greater of (i) the Market Value or (ii) the price at which we issue the additional Class A ordinary shares or equity-linked securities. On the exercise of any warrant, the exercise price will be paid directly to us and not placed in the trust account. We are not registering the Class A ordinary shares issuable upon exercise of the warrants (the "warrant shares") at this time. However, we have agreed that as soon as practicable, but in no event later than 20 business days after the closing of our initial business combination, we will use our best efforts to file with the SEC a registration statement for the registration under the Securities Act of the warrant shares and thereafter use our best efforts to cause the registration statement to become effective and to maintain the effectiveness of such registration statement until the expiration of the warrants. No warrants will be exercisable for cash unless we have an effective and current registration statement covering the issuance of the warrant shares and a current prospectus relating thereto. 29 Table of Contents If a registration statement covering the issuance of the warrant shares is not effective within 60 days following the consummation of our initial business combination, warrant holders may, commencing on the 61st day until such time as there is such an effective registration statement and during any period when we shall have failed to maintain such an effective registration statement, exercise warrants on a cashless basis in accordance with Section 3(a)(9) of the Securities Act. In this circumstance, each holder would pay the exercise price by surrendering warrants exercisable for the number of Class A ordinary shares equal to the quotient obtained by dividing (x) the product of the number of Class A ordinary shares underlying such warrants and the difference between the exercise price of such warrants and the "fair market value" (defined below) by (y) the fair market value. The "fair market value" means the average reported last sale price of the Class A ordinary shares for the ten trading days ending on the trading day prior to the date of exercise. Exercise period The warrants will become exercisable 30 days after the completion of our initial business combination The warrants will expire at 5:00 p.m., New York City time, on the fifth anniversary of our completion of an initial business combination, or earlier upon redemption. No fractional shares will be issued upon exercise of the warrants, and only whole warrants will trade. If, upon exercise of the warrants, a holder would be entitled to receive a fractional interest in a share, we will, upon exercise, round down to the nearest whole number of Class A ordinary shares to be issued to the warrant holder. Redemption of Warrants Once the warrants become exercisable, we may redeem the outstanding warrants: in whole and not in part; at a price of $0.01 per warrant; upon a minimum of 30 days prior written notice of redemption, which we refer to as the 30-day redemption period; and if, and only if, the last reported sale price of our Class A ordinary shares equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we send the notice of redemption to the warrant holders. We will not redeem the warrants unless a registration statement under the Securities Act covering the issuance of the warrant shares underlying the warrants to be so redeemed is then effective and a current prospectus relating to those warrant shares is available throughout the 30-day redemption period, except if the warrants may be exercised on a cashless basis and such cashless exercise is exempt from registration under the Securities Act. If and when the warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws. If the foregoing conditions are satisfied and we issue a notice of redemption, each warrant holder may exercise his, her or its warrants prior to the scheduled redemption date. However, the price of the Class A ordinary shares may fall below the $18.00 trigger price (as adjusted) as well as the $11.50 exercise price (as adjusted) after the redemption notice is issued. 30 Table of Contents The redemption criteria for our warrants have been established at a price which is intended to provide warrant holders a reasonable premium to the initial exercise price and provide a sufficient differential between the then-prevailing share price and the exercise price so that if the share price declines as a result of our redemption call, the redemption will not cause the share price to drop below the exercise price of the warrants. If we call the warrants for redemption as described above, our management will have the option to require all holders that wish to exercise warrants to do so on a "cashless basis." In making such determination, our management will consider, among other factors, our cash position, the number of warrants that are outstanding and the dilutive effect on our shareholders of issuing the maximum number of warrant shares issuable upon exercise of outstanding warrants. In such event, the holder would pay the exercise price by surrendering the warrants for that number of Class A ordinary shares equal to the quotient obtained by dividing (x) the product of the number of warrant shares underlying the warrants to be so exercised, and the difference between the exercise price of the warrants and the fair market value by (y) the fair market value. No fractional Class A ordinary share will be issued upon redemption. If, upon redemption, a holder would be entitled to receive a fractional interest in a share, we will round down to the nearest whole number of the number of Class A ordinary shares to be issued to the holder. Founder Shares Our Sponsor has acquired 7,666,667 founder shares from us for an aggregate purchase price of $25,000, or $0.003 per share, of which up to 1,000,000 founder shares remain subject to surrender for no consideration depending on the extent to which the underwriter s over-allotment option is exercised during this offering. As a result, as of the date of this prospectus, we have 7,666,667 founder shares outstanding (assuming no exercise of the over-allotment option). Pursuant to a Securities Transfer Agreement, our Sponsor has transferred 20,000 founder shares (or 100,000 in the aggregate) to each of the Company s director nominees, Christopher Bradley, Brian Rudick, Mathew August, Danel Calvillo Armendariz and Dr. Jim Kyung Soo Liew, for the sum of $0.003 per share, following which transfer our Sponsor holds an aggregate of 7,566,667 founder shares. Subject to each non-managing Sponsor investor indirectly purchasing, through the Class A ordinary shares, the private units allocated to it in connection with the closing of this offering, the Sponsor will issue securities at a nominal purchase price to the non-managing Sponsor investors reflecting interests in an aggregate of 900,000 founder shares held by the Sponsor. The number of founder shares, and the surrender mechanism underlying the founder shares, has been determined in order to ensure that the founder shares will collectively represent 25% of the outstanding ordinary shares (excluding any shares underlying the private units) upon completion of this offering and the exercise of the underwriter s over-allotment option, if any. If we increase or decrease the size of this offering pursuant to Rule 462(b) under the Securities Act, we will effect a share dividend, a share contribution back to capital, or other appropriate mechanism, as applicable, immediately prior to the consummation of the offering, in such amount as to maintain the collective ownership of the initial shareholders, prior to this offering at approximately 25% of our issued and outstanding Class A ordinary shares (excluding any shares underlying the private units) upon the consummation of this offering. Such issuance will significantly dilute the equity interest of our other shareholders. Prior to the investment in the Company of an aggregate of $25,000 by our Sponsor, we had no assets, tangible or intangible. 31 Table of Contents The founder shares are identical to the Class A ordinary shares being sold in this offering, except that: only holders of the founder shares have the right to vote on the appointment and removal of our directors prior to the completion of our initial business combination (by a majority of votes cast by the holders of the founder shares); in a vote to transfer the Company by way of continuation to a jurisdiction outside the Cayman Islands prior to the completion of our initial business combination (which requires a special resolution, being the affirmative vote of at least two-thirds of the votes cast by the shareholders of the issued shares present in person or represented by proxy and entitled to vote on such matter at a general meeting of the Company), only holders of our founder shares shall carry the right to vote; the founder shares are subject to certain transfer restrictions, as described in more detail below; as described below adjacent to the caption "Voting arrangements with our Sponsor, non-managing Sponsor investors and related parties," our initial shareholders will each enter into agreements with us, pursuant to which they will agree: (1) to waive their redemption rights with respect to their founder shares and private shares held by them in connection with the consummation of our initial business combination or a tender offer conducted prior to a business combination or in connection with it; and (2) to waive their rights to liquidating distributions from the trust account with respect to their founder shares and private shares if we fail to complete our initial business combination within 24 months from the closing of this offering, although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame; the founder shares will automatically convert into our Class A ordinary shares at the time of our initial business combination or earlier at the option of the holder on a one-for-one basis, subject to adjustment pursuant to certain anti-dilution rights, as described below adjacent to the caption "Conversion of founder shares and anti-dilution rights" and in our amended and restated memorandum and articles of association; and the founder shares and private shares are entitled to registration rights. The non-managing Sponsor investors are not granted any shareholder or other rights in addition to those afforded to our other public shareholders, and will only be issued Class A ordinary shares in the Sponsor, with no right to control the Sponsor or vote or dispose of any securities held by the Sponsor, including the founder shares and the private units held by the Sponsor. The non-managing Sponsor investors are not required to (i) hold any units, Class A ordinary shares or public warrants they may purchase in this offering or thereafter for any amount of time, (ii) vote any Class A ordinary shares they may own at the applicable time in favor of our initial business combination or (iii) refrain from exercising their right to redeem their public shares at the time of our initial business combination. The non-managing Sponsor investors will have the same rights to the funds held in the trust account with respect to the Class A ordinary shares underlying the public units they may purchase in this offering as the rights afforded to our other public shareholders. However, the non-managing Sponsor investors will have different interests than our other public shareholders in approving our initial business combination and otherwise exercising their rights as public shareholders because of their indirect ownership of founder shares and private units, as further discussed in this prospectus. 32 Table of Contents The interests of the shareholders of the Sponsor are denominated in three classes of ordinary shares: (i) class A ordinary shares representing non-voting interests in the founder shares (ii) class B ordinary shares that will represent a non-voting interest in the private units, and (iii) Class C ordinary shares that represent a voting interest but no economic interest. All members of the Sponsor, including the managing member of the Sponsor, and any non-managing Sponsor investor that may join the Sponsor concurrently with this offering will hold Class A ordinary shares and Class B ordinary shares representing their proportional interest in the founder shares and private units, respectively. Pursuant to an agreement of all members of the Sponsor, the management and control of the Sponsor is vested exclusively with Vikas Mittal and Charles T. Cassel III, the directors of the Sponsor, without any voting, veto, consent or other participation rights by any non-managing shareholders regardless of their unit ownership. All matters submitted to a vote by the directors will require the affirmative vote of the class C ordinary shares of the Sponsor which are held by Samara CSLM LLC and Consilium Investment Capital Inc., without regard to any ordinary shares held by any non-managing members. As a result, non-managing Sponsor investors will have no right to control the Sponsor, or participate in any decision regarding the disposal of any security held by the Sponsor, or otherwise. Private Units Our Sponsor has committed, pursuant to a written agreement, to purchase an aggregate of 500,000 private units at $10.00 per private unit in a private placement that will close simultaneously with this offering (or 575,000 private units if the underwriter s over-allotment option is exercised in full) and our underwriter has committed, pursuant to a written agreement, to purchase an aggregate of 275,000 private units (or 316,250 private units if the underwriter s over-allotment option is exercised in full) at $10.00 per private unit in a private placement that will close simultaneously with this offering. A portion of the purchase price of the private units will be added to the proceeds of this offering to be held in the trust account described below. If we do not complete our initial business combination within 24 months from the closing of this offering, the proceeds from the sale of the private units held in the trust account will be used to fund the redemption of our public shares (subject to the requirements of applicable law). The private units will also be worthless if we do not complete our initial business combination. A portion of the purchase price of the private units will be added to the proceeds from this offering to be held in the trust account. The private units will be identical to the units sold in this offering except that, so long as they are held by our Sponsor or its permitted transferees, the private units (including the component securities as well as any securities underlying those component securities) (i) may not, subject to certain limited exceptions, be transferred, assigned or sold by the holders until 30 days after the completion of our initial business combination and (ii) will be entitled to registration rights. If we do not complete our initial business combination within the completion window, the private units will expire worthless. The non-managing Sponsor investors have indicated an interest to indirectly purchase, through the purchase of the Sponsor s securities, an aggregate of 180,000 private units at a price of $10.00 per unit ($1,800,000 in the aggregate) in a private placement that will close simultaneously with the closing of this offering. Subject to each non-managing Sponsor investor indirectly purchasing, through securities, the private units allocated to it in connection with the closing of this offering, the Sponsor will issue securities at a nominal purchase price to the non-managing Sponsor investors reflecting interests in an aggregate of 900,000 founder shares held by the Sponsor. The non-managing Sponsor investors will not be subject to transfer restrictions or a lock-up agreement on any public securities that they may purchase in this offering pursuant to the expressions of interest described below or otherwise. Except in certain limited circumstances, no member of the Sponsor (including the non-managing Sponsor investors) may Transfer all or any portion of its ordinary shares in the Sponsor. For more information, see "Principal Shareholders". 33 Table of Contents Sponsor s Securities and Compensation The table below summarizes (i) the amount of founder shares and private units issued or to be issued to the Sponsor in connection with this offering and the price paid or to be paid by the Sponsor for such securities, and (ii) the main items of compensation received or to be received by the Sponsor or our affiliates: Description Price Paid or Payable Number of founder shares 7,666,667 founder shares (of which 1,000,000 are subject to surrender for no consideration to the extent the underwriter does not exercise its over-allotment option)* $0.003 per share Number of private units 500,000 private units (or 575,000 private units if the underwriter s over-allotment option is exercised in full) $10.00 per private unit Office space and general and administrative services Monthly payments to our Sponsor $30,000 per month Working Capital Loans Up to $1,500,000 convertible into private units at a price of $10.00 per unit Not applicable * Class B ordinary shares, will be convertible at the option of the holder on a one-for-one basis or will automatically convert into Class A ordinary shares concurrently with or immediately following the consummation of our initial business combination at a ratio such that the number of Class A ordinary shares issuable upon conversion of all founder shares will equal, in the aggregate, on an as-converted basis, 25% of the sum of (i) the total number of ordinary shares issued and outstanding upon the consummation of this offering, plus (ii) the sum of the total number of Class A ordinary shares issued or deemed issued or issuable upon conversion or exercise of any equity-linked securities (as defined herein) or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of the initial business combination, excluding any Class A ordinary shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued, deemed issued, or to be issued, to any seller in the initial business combination and any private placement-equivalent shares issued to our Sponsor, members of our management team or any of their affiliates upon conversion of working capital loans made to the Company. In no event will the Class B ordinary shares convert into Class A ordinary shares at a rate of less than one-to-one. The Class A ordinary shares issuable upon conversion of our Class B ordinary shares may result in material dilution to our public shareholders due to the anti-dilution rights of our founder shares that may ultimately result in an issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion. If we increase or decrease the size of the offering, we will effect a share capitalization or a share repurchase or redemption or other appropriate mechanism, as applicable, with respect to our Class B ordinary shares immediately prior to the consummation of the offering in such amount as to maintain the ownership of founder shares by our initial shareholders, on an as-converted basis, at 25% of our issued and outstanding ordinary shares upon the consummation of this offering (not including the Class A ordinary shares comprising part of the private units and the Class A ordinary shares underlying the private warrants). Such issuance will significantly dilute the equity interest of our other shareholders. Pursuant to a Securities Transfer Agreement, our Sponsor has transferred 20,000 founder shares (or 100,000 in the aggregate) to each of the Company s director nominees, Christopher Bradley, Brian Rudick, Mathew August, Danel Calvillo Armendariz and Dr. Jim Kyung Soo Liew, for the sum of $0.003 per share, following which transfer our Sponsor holds an aggregate of 7,566,667 founder shares. 34 Table of Contents As described below adjacent to the caption "Conversion of founder shares and anti-dilution rights," the founder shares and Class A ordinary shares issuable in connection with the conversion of the founder shares (including those issued in connection with an increase in the size of the offering) may result in material dilution to our public shareholders due to the nominal price of $0.003 per founder share at which our Sponsor purchased the founder shares and/or the anti-dilution rights of our founder shares that may result in an issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion. Our initial shareholders or their affiliates may receive additional compensation and/or may be issued additional securities in connection with an initial business combination, including securities that may result in material dilution to public shareholders. For more information also see below adjacent to the caption "Limited payments to insiders." Transfer restrictions applicable to founder shares and private units Except with respect to permitted transferees as described herein under "Principal Shareholders," our initial shareholders have agreed not to transfer, assign or sell any of their respective founder shares and private units that they may hold until the date that is (i) in the case of the founder shares, the earlier of (A) six months after the date of the consummation of our initial business combination or (B) subsequent to our initial business combination, the date on which we consummate a liquidation, merger, stock exchange or other similar transaction after our initial business combination which results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property, and (ii) in the case of the private units or any securities underlying the private units, until 30 days after the completion of our initial business combination. Except in certain limited circumstances, no member of the Sponsor (including the non-managing Sponsor investors) may sell, transfer, assign, pledge, mortgage, charge, hypothecate, exchange or otherwise dispose, directly or indirectly, (a "Transfer") all or any portion of its ordinary shares in the Sponsor. For more information, see "Principal Shareholders". Any permitted transferees would be subject to the same restrictions and other agreements of our initial shareholders with respect to any founder shares and private units. We refer to such transfer restrictions throughout this prospectus as the "lock-up." 35 Table of Contents Conversion of founder shares and anti-dilution rights Subject to adjustment for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein, the founder shares, which are designated as Class B ordinary shares, will be convertible at the option of the holder on a one-for-one basis or will automatically convert into Class A ordinary shares concurrently with or immediately following the consummation of our initial business combination at a ratio such that the number of Class A ordinary shares issuable upon conversion of all founder shares will equal, in the aggregate, on an as-converted basis, 25% of the sum of (i) the total number of ordinary shares issued and outstanding (assuming no exercise of the over-allotment option by the underwriter and including any Class A ordinary shares that may have been issued on a one-for-one basis upon conversion of the Class B ordinary shares at the option of the holder thereof prior to the initial business combination pursuant to the amended and restated memorandum and articles of association) upon the consummation of this offering, plus (ii) the sum of the total number of Class A ordinary shares issued or deemed issued or issuable upon conversion or exercise of any equity-linked securities (as defined herein) or rights issued or deemed issued, by the Company in connection with or in relation to the consummation of the initial business combination, excluding any Class A ordinary shares or equity-linked securities exercisable for or convertible into Class A ordinary shares issued, deemed issued, or to be issued, to any seller in the initial business combination and any private placement-equivalent shares issued to our Sponsor, members of our management team or any of their affiliates upon conversion of working capital loans made to the Company The shares redeemed in connection with any amendment to our amended and restated memorandum and articles of association will not be subtracted from the number of shares used to determine the 25% share interest. Any conversion of Class B ordinary shares described herein will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. In no event will the Class B ordinary shares convert into Class A ordinary shares at a rate of less than one-to-one. The term "equity-linked securities" refers to any debt or equity securities that are convertible, exercisable or exchangeable for our Class A ordinary shares issued in a financing transaction in connection with our initial business combination, including, but not limited to, a private placement of equity or debt. Voting arrangements with our Sponsor, non-managing Sponsor investors and related parties Our initial shareholders will each enter into agreements with us, pursuant to which they will agree: (1) to waive their redemption rights with respect to their founder shares and private shares held by them in connection with the consummation of our initial business combination or a tender offer conducted prior to a business combination or in connection with it; and (2) to waive their rights to liquidating distributions from the trust account with respect to their founder shares and private shares if we fail to complete our initial business combination within 24 months from the closing of this offering, although they will be entitled to liquidating distributions from the trust account with respect to any public shares they hold if we fail to complete our initial business combination within the prescribed time frame. If we submit an initial business combination to our shareholders for a vote, we will complete our initial business combination only if a majority of the ordinary shares, represented in person or by proxy and entitled to vote thereon, voted at a shareholder meeting are voted in favor of the business combination. Our initial shareholders have agreed to vote any Class A and Class B ordinary shares held by them in favor of such initial business combination. As a result, in addition to the founder shares and private shares, we would need approximately 6,279,167 public shares, or approximately 31.40% of the 20,000,000 public shares sold in this offering, to be voted in favor of a transaction (assuming all issued and outstanding shares are voted, the over-allotment option is not exercised and 1,000,000 founder shares have been forfeited) in order to have such initial business combination approved. Assuming that only the holders of one-third of our issued and outstanding ordinary shares, representing a quorum under our amended and restated memorandum and articles of association, vote their shares, we will not need any public shares in addition to our founder shares and the private shares held by our Sponsor to be voted in favor of an initial business combination in order to approve an initial business combination. In addition Meteora, for which Mr. Mittal serves as the Managing Member and Chief Investment Officer, Consilium or their affiliates may also purchase additional public shares which they have agreed to vote in favor of a transaction aside from shares they may purchase in compliance with the requirements of Rule 14e-5 under the Exchange Act, which would not be voted in favor of approving the business combination transaction. 36 Table of Contents Offering proceeds to be held in the trust account The Nasdaq rules provide that at least 90% of the gross proceeds from this offering and the sale of the units be deposited in a trust account. Of the net proceeds we will receive from this offering and the sale of the private units described in this prospectus, $200,000,000, $230,000,000 if the underwriter s over-allotment option is exercised in full ($10.00 per unit in either case), will be placed in a U.S. based trust account with Continental Stock Transfer & Trust Company acting as trustee, and initially be invested only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 under the Investment Company Act which invest only in direct U.S. government treasury obligations; the holding of these assets in this form is intended to be temporary and for the sole purpose of facilitating the intended business Except as set forth below, the proceeds held in the trust account will not be released until the earlier of: (1) the completion of our initial business combination within the required time period; (2) our redemption of 100% of the outstanding public shares if we have not completed an initial business combination in the required time period; or (3) our redemption of our public shares in connection with the approval of any amendment to the provisions of our amended and restated memorandum and articles of association governing our pre-initial business combination activity and related shareholders rights. Therefore, unless and until our initial business combination is consummated, the proceeds held in the trust account will not be available for our use for any expenses related to this offering or expenses which we may incur related to the investigation and selection of a target business and the negotiation of an agreement to acquire a target business. The proceeds deposited in the trust account could become subject to the claims of our creditors, if any, which could have priority over the claims of our public shareholders. Unless and until we complete our initial business combination, no proceeds held in the trust account will be available for our use, except the withdrawal of interest to pay taxes, if any. Based upon current interest rates, we expect the trust account to generate approximately $11,250,000 of interest annually (or $12,937,500 if the over-allotment option is exercised in full) (assuming an interest rate of 4.50% per year). Unless and until we complete our initial business combination, we may pay our expenses only from: that portion of the net proceeds of this offering and the sale of the private units not held in the trust account and cash held outside the trust account before the offering, which will be approximately $2,973,324 in working capital after the payment of approximately $776,676 in offering expenses relating to this offering (assuming that the over-allotment has not been exercised); and any loans or additional investments from our Sponsor, members of our management team or any of their affiliates or other third parties, although they are under no obligation to loan funds or invest in us and provided that any such loans will not have any claim on the proceeds held in the trust account unless such proceeds are released to us upon completion of our initial business combination. Limited payments to insiders There will be no fees, reimbursements or other cash payments paid to our Sponsor, officers and directors, or their affiliates prior to, or for any services they render in order to effectuate, the consummation of our initial business combination (regardless of the type of transaction that it is) other than the following payments, none of which will be made from that portion of the proceeds of this offering and the sale of the private units held in the trust account prior to the consummation of our initial business combination: Repayment of an aggregate of up to $300,000 in loans made to us by our Sponsor to cover offering-related and organizational expenses; 37 Table of Contents payment to our Sponsor of a total of $30,000 per month for company administration, office space, utilities, and secretarial and administrative support (See "Certain Relationships and Related Party Transactions — Administrative Services Agreement"); Reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination; and Repayment of loans which may be made by our Sponsor or an affiliate of our Sponsor or certain of our directors and officers to finance transaction costs in connection with an intended initial business combination, the terms of which have not been determined nor have any written agreements been executed with respect thereto. Up to $1,500,000 of such loans may be convertible into units, at a price of $10.00 per unit at the option of the lender. We may also pay finder s fees, reimbursements or cash payments to our Sponsor, directors or officers, or our or any of their respective affiliates, for services rendered to us prior to or in connection with the completion of our initial business combination but no such fees are currently contemplated. These payments may be funded using that portion of the net proceeds of this offering and the sale of the private units not held in the trust account or, upon completion of the initial business combination, from any amounts remaining from the proceeds of the trust account released to us in connection therewith. Our audit committee will review on a quarterly basis all payments that were made to our Sponsor, executive officers or directors, or our or any of their affiliates. Audit Committee Prior to the effectiveness of this registration statement, we will have established and will maintain an audit committee (which will be composed entirely of independent directors) to, among other things, monitor compliance with the terms described above and the other terms relating to this offering. If any noncompliance is identified, then the audit committee will be charged with the responsibility to immediately take all action necessary to rectify such noncompliance or otherwise to cause compliance with the terms of this offering. For more information, see section "Management—Committees of the Board of Directors—Audit Committee." Election of directors; Voting rights Except as set forth below, holders of record of our Class A ordinary shares and Class B ordinary shares are entitled to one vote for each share held on all matters to be voted on by shareholders. Unless specified in our amended and restated memorandum and articles of association or as required by the Companies Act or stock exchange rules, a special resolution under Cayman Islands law and our amended and restated memorandum and articles of association, which requires the affirmative vote of at least a two-thirds (2/3) majority (or such higher approval threshold as specified in the Company s amended and restated memorandum and articles of association) of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at a general meeting of the Company of which notice specifying the intention to propose the resolution as a special resolution has been duly given, is generally required to approve any matter voted on by our shareholders. Approval of certain actions require a special resolution under Cayman Islands law, which (except as specified below) requires the affirmative vote of at least two-thirds of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at the applicable general meeting, and pursuant to our amended and restated memorandum and articles of association, such actions include amending our amended and restated memorandum and articles of association and approving a statutory merger or consolidation with another company. There is no cumulative voting with respect to the appointment and the removal of our directors, meaning, following our initial business combination, the holders of more than 50% of our ordinary shares voted for the appointment and the removal of our directors can elect all of the directors. 38 Table of Contents Prior to the completion of our initial business combination, only holders of our founder shares will have the right to vote on the appointment and removal of directors (by a majority of votes cast by the holders of the founder shares). Holders of our public shares will not be entitled to vote on the election of directors during such time. Further, prior to the closing of our initial business combination, only holders of our Class B ordinary shares will be entitled to vote on transferring the Company by way of continuation in a jurisdiction outside the Cayman Islands (which requires a special resolution, being the affirmative vote of at least two-thirds of the votes cast by the shareholders of the issued shares present in person or represented by proxy and entitled to vote on such matter at a general meeting of the Company) (including any special resolution required to amend the constitutional documents of the Company or to adopt new constitutional documents of the Company, in each case, as a result of the Company approving a transfer by way of continuation in a jurisdiction outside the Cayman Islands) and, as a result, our initial shareholders will be able to approve any such proposal without the vote of any other shareholder. These provisions of our amended and restated memorandum and articles of association may only be amended by a special resolution passed by holders representing at least two-thirds of our outstanding Class B ordinary shares. With respect to any other matter submitted to a vote of our shareholders, including any vote in connection with our initial business combination, except as required by law or the applicable rules of Nasdaq then in effect, holders of our founder shares and private shares and holders of our public shares will vote together as a single class, with each share entitling the holder to one vote. Conditions to completing our initial business combination There is no limitation on our ability to raise funds privately or through loans in connection with our initial business combination. The Nasdaq rules require that our initial business combination must be with one or more operating businesses or assets with a fair market value equal to at least 80% of the net assets held in trust (less any taxes payable on interest earned) at the time of our signing a definitive agreement in connection with our initial business combination. We do not currently intend to purchase multiple businesses in unrelated industries in conjunction with our initial business combination. If our Board of Directors is not able to independently determine the fair market value of the target business or businesses, we may obtain an opinion, in our sole discretion, from an independent investment banking firm that is a member of FINRA, or from another independent entity. However, unless we consummate our initial business combination with an affiliated entity, our Board of Directors is not required to obtain an opinion from an independent investment banking firm or another independent entity that the price we are paying is fair to our shareholders from a financial point of view. We will complete our initial business combination only if the post-transaction company in which our public shareholders own shares will own or acquire 50% or more of the issued and outstanding voting securities of the target or otherwise acquire a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to our initial business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in our initial business combination transaction. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% of net assets test; provided that in the event that our initial business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. 39 Table of Contents Permitted purchases of public shares by our affiliates If we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our Sponsor, directors, executive officers, advisors or any of their affiliates may purchase shares of our Class A ordinary shares in privately negotiated transactions or in the open market either prior to or following the completion of our initial business combination. Please see "Proposed Business—Initial Business Combination" for a description of how such persons will determine from which shareholders to seek to acquire shares. If our sponsor, initial shareholders, directors, officers, advisors or their affiliates were to purchase shares from public shareholders, they would do so at a price no higher than the price offered through our redemption process. However, such persons have no current commitments, plans or intentions to engage in such transactions and have not formulated any terms or conditions for any such transactions. In the event our Sponsor, directors, executive officers, advisors or any of their affiliates determine to make any such purchases at the time of a shareholder vote relating to our initial business combination, such purchases could have the effect of influencing the vote necessary to approve such transaction. None of the funds in the trust account will be used to purchase Class A ordinary shares in such transactions. If any of our Sponsor, directors, executive officers, advisors or any of their affiliates engages in such transactions, they will not make any such purchases when they are in possession of any material non-public information not disclosed to the seller or if such purchases are prohibited by Regulation M under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Subsequent to the consummation of this offering, we will adopt an insider trading policy which will require insiders to (1) refrain from purchasing securities during certain blackout periods and when they are in possession of any material non-public information and (2) clear all trades with our legal counsel prior to execution. We cannot currently determine whether any of our insiders will make such purchases pursuant to a Rule 10b5-1 plan, as that would be dependent upon several factors, including but not limited to, the timing and size of any such purchase. Depending on the circumstances, any of our insiders may decide to make purchases of our Class A ordinary shares pursuant to a Rule 10b5-1 plan or may determine that acting pursuant to such a plan is not required under the Exchange Act. We do not currently anticipate that purchases of our Class A ordinary shares by any of our Sponsor, directors, executive officers, advisors or any of their affiliates, if any, would constitute a tender offer subject to the tender offer rules under the Exchange Act or a going-private transaction subject to the going-private rules under the Exchange Act; however, if the purchasers determine at the time of any such purchases that the purchases are subject to such rules, the purchasers will comply with such rules. None of our Sponsor, directors, officers, advisors or any of their affiliates will purchase Class A ordinary shares if such purchases would violate Section 9(a)(2) or Rule 10b-5 of the Exchange Act. Additionally, in the event our sponsor, initial shareholders, directors, officers, advisors or their affiliates were to purchase shares from public shareholders such purchases would be structured in compliance with the requirements of Rule 14e-5 under the Exchange Act including, in pertinent part, through adherence to the following: our registration statement/proxy statement filed for our business combination transaction would disclose the possibility that our sponsor, initial shareholders, directors, officers, advisors or their affiliates may purchase shares from public shareholders outside the redemption process, along with the purpose of such purchases; 40 Table of Contents if our sponsor, initial shareholders, directors, officers, advisors or their affiliates were to purchase shares from public shareholders, they would do so at a price no higher than the price offered through our redemption process; our registration statement/proxy statement filed for our business combination transaction would include a representation that any of our securities purchased by our sponsor, initial shareholders, directors, officers, advisors or their affiliates would not be voted in favor of approving the business combination transaction; our sponsor, initial shareholders, directors, officers, advisors or their affiliates would not possess any redemption rights with respect to our securities or, if they do acquire and possess redemption rights, they would waive such rights; and we would disclose in a Current Report on Form 8-K, before our general meeting of shareholders to approve the business combination transaction, the following material items: the amount of our securities purchased outside of the redemption offer by our sponsor, initial shareholders, directors, officers, advisors or their affiliates, along with the purchase price; the purpose of the purchases by our sponsor, initial shareholders, directors, officers, advisors or their affiliates; the impact, if any, of the purchases by our sponsor, initial shareholders, directors, officers, advisors or their affiliates on the likelihood that the business combination transaction will be approved; the identities of our security holders who sold to our sponsor, initial shareholders, directors, officers, advisors or their affiliates (if not purchased on the open market) or the nature of our security holders (e.g., 5% security holders) who sold to our sponsor, initial shareholders, directors, officers, advisors or their affiliates; and the number of our securities for which we have received redemption requests pursuant to our redemption offer. The purpose of any such transaction could be to satisfy a closing condition in an agreement with a target that requires us to have a minimum net worth or a certain amount of cash at the closing of our initial business combination, where it appears that such requirement would otherwise not be met. Any such purchases of our securities may result in the completion of our initial business combination that may not otherwise have been possible. In addition, if such purchases are made, the public "float" of our securities may be reduced and the number of beneficial holders of our securities may be reduced, which may make it difficult to maintain or obtain the quotation, listing or trading of our securities on a national securities exchange. Please see "Risk Factors — Purchases of public shares in the open market or in privately negotiated transactions by our Sponsor, directors, executive officers, advisors or their affiliates may make it difficult for us to maintain the listing of our public shares on Nasdaq following the consummation of an initial business combination. Redemption rights for public shareholders upon completion of our initial business combination We will provide our public shareholders with the opportunity to redeem, regardless of whether they abstain, vote for, or vote against, our initial business combination, all or a portion of their public shares upon the completion of our initial business combination at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account as of two business days prior to the consummation of our initial business combination, including interest earned thereon (which interest shall be net of taxes payable, if any), divided by the number of then issued and outstanding public shares, subject to the limitations described herein. 41 Table of Contents The amount in the trust account is initially anticipated to be $10.00 per public share. There will be no redemption rights upon the completion of our initial business combination with respect to our warrants. Our initial shareholders have entered into agreements with us, pursuant to which they will agree to waive their redemption rights with respect to their founder shares and private shares held by them in connection with the consummation of our initial business combination. The non-managing sponsor investors are not required to (i) hold any units, Class A ordinary shares, or public warrants they may purchase in this offering or thereafter for any amount of time, (ii) vote any Class A ordinary shares they may own at the applicable time in favor of our initial business combination or (iii) refrain from exercising their right to redeem their public shares at the time of our initial business combination. The non-managing sponsor investors will have the same rights to the funds held in the trust account with respect to the Class A ordinary shares underlying the public units they may purchase in this offering as the rights afforded to our other public shareholders. However, the non-managing sponsor investors will have different interests than our other public shareholders in approving our initial business combination and otherwise exercising their rights as public shareholders because of their indirect ownership of founder shares as further discussed in this prospectus. Manner of conducting redemptions We will provide our public shareholders with the opportunity to redeem, regardless of whether they abstain, vote for, or vote against, our initial business combination, all or a portion of their public shares upon the completion of our initial business combination either (1) in connection with a shareholder meeting called to approve the business combination or (2) by means of a tender offer. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under applicable law or stock exchange listing requirement. Asset acquisitions and share purchases would not typically require shareholder approval while direct mergers with our Company where we do not survive and any transactions where we issue more than 20% of our issued and outstanding ordinary shares or seek to amend our amended and restated memorandum and articles of association would require shareholder approval. We currently intend to conduct redemptions in connection with a shareholder vote unless shareholder approval is not required by applicable law or stock exchange rule or we choose to conduct redemptions pursuant to the tender offer rules of the SEC for business or other reasons. If a shareholder vote is not required and we do not decide to hold a shareholder vote for business or other reasons, we will, pursuant to our amended and restated memorandum and articles of association: conduct the redemptions pursuant to Rule 13e-4 and Regulation 14E of the Exchange Act, which regulate issuer tender offers; and file tender offer documents with the SEC prior to completing our initial business combination which contain substantially the same financial and other information about the initial business combination and the redemption rights as is required under Regulation 14A of the Exchange Act, which regulates the solicitation of proxies. 42 Table of Contents Upon the public announcement of our initial business combination, if we elect to conduct redemptions pursuant to the tender offer rules, we and our Sponsor, directors and executive officers will terminate any plan established in accordance with Rule 10b5-1 under the Exchange Act to purchase Class A ordinary shares in the open market, in order to comply with Rule 14e-5 under the Exchange Act. In the event we conduct redemptions pursuant to the tender offer rules, our offer to redeem will remain open for at least 20 business days, in accordance with Rule 14e-1(a) under the Exchange Act, and we will not be permitted to complete our initial business combination until the expiration of the tender offer period. In addition, the tender offer will be conditioned on public shareholders not tendering more than a specified number of public shares. If public shareholders tender more shares than we have offered to purchase, we will withdraw the tender offer and not complete such initial business combination. If, however, shareholder approval of the transaction is required by applicable law or stock exchange listing requirement, or we decide to obtain shareholder approval for business or other reasons, we will: conduct the redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, which regulates the solicitation of proxies, and not pursuant to the tender offer rules; and file proxy materials with the SEC. We expect that a final proxy statement would be mailed to public shareholders at least 20 days prior to the shareholder vote. However, we expect that a draft proxy statement would be made available to such shareholders well in advance of such time, providing additional notice of redemption if we conduct redemptions in conjunction with a proxy solicitation. Although we are not required to do so, we currently intend to comply with the substantive and procedural requirements of Regulation 14A in connection with any shareholder vote even if we are not able to maintain our Nasdaq listings or Exchange Act registration. If we seek shareholder approval, we will complete our initial business combination only if a majority of the ordinary shares, represented in person or by proxy and entitled to vote thereon, voted at a shareholder meeting are voted in favor of the business combination. In such case, pursuant to the terms of agreements entered into with us, our initial shareholders will agree (and any of their permitted transferees will agree) to vote their founder shares and private shares held by them in favor of our initial business combination. To the extent that our initial shareholders acquire any public shares after we publicly announce our intention to engage in a proposed business combination, such initial shareholders have agreed pursuant to the terms of a letter agreement that they will not vote such shares for or against such business combination. As a result, in addition to the founder shares and private shares that our Sponsor, the underwriter, and the non-managing sponsor investors have committed to purchase (as described above), we would need approximately 6,279,167 public shares, or approximately 31.40% of the 20,000,000 public shares sold in this offering, to be voted in favor of a transaction (assuming all issued and outstanding shares are voted, the over-allotment option is not exercised and 1,000,000 founder shares have been surrendered for no consideration) in order to have such initial business combination approved. Assuming that only the holders of one-third of our issued and outstanding ordinary shares, representing a quorum under our amended and restated memorandum and articles of association, vote their shares, we will not need any public shares in addition to our founder shares and the private shares held by our Sponsor to be voted in favor of an initial business combination in order to approve an initial business combination. These voting thresholds, and the voting agreements of our initial shareholders may make it more likely that we will consummate our initial business combination. Each public shareholder may elect to redeem their public shares without voting, and if they do vote, irrespective of whether they vote for or against the proposed transaction. Our amended and restated memorandum and articles of association will require that at least five clear days notice will be given of any such shareholder meeting. 43 Table of Contents Redemptions of our public shares may also be subject to a higher net tangible asset test or cash requirement pursuant to an agreement relating to our initial business combination. For example, the proposed business combination may require: (1) cash consideration to be paid to the target or its owners; (2) cash to be transferred to the target for working capital or other general corporate purposes; or (3) the retention of cash to satisfy other conditions in accordance with the terms of the proposed business combination. In the event the aggregate cash consideration we would be required to pay for all Class A ordinary shares that are validly submitted for redemption plus any amount required to satisfy cash conditions pursuant to the terms of the proposed business combination exceed the aggregate amount of cash available to us, we would not complete the business combination or redeem any Class A ordinary shares, and all Class A ordinary shares submitted for redemption would be returned to the holders thereof. Tendering share certificates in connection with a tender offer or redemption rights We may require our public shareholders seeking to exercise their redemption rights, whether they are record holders or hold their shares in "street name," to either tender their certificates to our transfer agent prior to the date set forth in the tender offer documents or proxy materials mailed to such holders, or up to two (2) business days prior to the vote on the proposal to approve our initial business combination in the event we distribute proxy materials, or to deliver their shares to the transfer agent electronically using The Depository Trust Company s DWAC (Deposit/Withdrawal At Custodian) System, at the holder s option, rather than simply voting against the initial business combination. The tender offer or proxy materials, as applicable, that we will furnish to holders of our public shares in connection with our initial business combination will indicate whether we are requiring public shareholders to satisfy such delivery requirements. Limitation on redemption rights of shareholders holding more than 15% of the public shares sold in this offering if we hold a shareholder vote Notwithstanding the foregoing redemption rights, if we seek shareholder approval of our initial business combination and we do not conduct redemptions in connection with our initial business combination pursuant to the tender offer rules, our amended and restated memorandum and articles of association provide that a public shareholder, together with any affiliate of such shareholder or any other person with whom such shareholder is acting in concert or as a "group" (as defined under Section 13 of the Exchange Act), will be restricted from redeeming its shares with respect to more than an aggregate of 15% of the public shares sold in this offering, without our prior consent. We believe the restriction described above will discourage shareholders from accumulating large blocks of shares, and subsequent attempts by such holders to use their ability to redeem their shares as a means to force us or our management to purchase their shares at a significant premium to the then-current market price or on other undesirable terms. Absent this provision, a public shareholder holding more than an aggregate of 15% of the shares sold in this offering could threaten to exercise its redemption rights against a business combination if such holder s shares are not purchased by us, our Sponsor or our management at a premium to the then-current market price or on other undesirable terms. By limiting our shareholders ability to redeem to no more than 15% of the shares sold in this offering, we believe we will limit the ability of a small group of shareholders to unreasonably attempt to block our ability to complete our initial business combination, particularly in connection with a business combination with a target that requires as a closing condition that we have a minimum net worth or a certain amount of cash. However, we would not be restricting our shareholders ability to vote all of their shares (including all shares held by those shareholders that hold more than 15% of the shares sold in this offering) for or against our initial business combination. 44 Table of Contents Redemption rights in connection with proposed amendments to our charter documents Our amended and restated memorandum and articles of association will provide that amendments to any its provisions relating to our pre-initial business combination activity and related shareholder rights, as well as any other provision of the amended and restated memorandum and articles of association, may be amended if approved by holders of a majority of our outstanding Class A ordinary shares, subject to applicable stock exchange rules. If an amendment to any such provision is approved by the requisite shareholder vote, then the corresponding provisions of the trust agreement governing the release of funds from our trust account may be amended. After the completion of this offering, and prior to the consummation of our initial business combination, we may not issue any additional shares of capital stock that would entitle the holders thereof to receive funds from the trust account or vote on an initial business combination, on any pre-business combination activity or on any amendment to the provisions of our amended and restated memorandum and articles of association relating to our pre-initial business combination activity and related shareholders rights. Our Sponsor, executive officers and directors (and any of their permitted transferees), who will beneficially own approximately 25% of our outstanding ordinary shares upon the closing of this offering (assuming they do not purchase public units in this offering and that the underwriter does not exercise its over-allotment option and excluding any shares underlying the private units), may participate in any vote to amend our amended and restated memorandum and articles of association and will have the discretion to vote in any manner they choose; provided, that, each of them has agreed (and their permitted transferees will agree), pursuant to a written agreement with us, that they will not propose any amendment to our amended and restated memorandum and articles of association that would affect the substance or timing of our obligation to redeem 100% of our public shares if we do not complete our initial business combination within 24 months from the closing of this offering unless we provide our public shareholders with the opportunity to redeem their Class A ordinary shares upon approval of any such amendment at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (which interest shall be net of taxes payable and up to $100,000 of interest to pay dissolution expenses)), divided by the number of then issued and outstanding public shares. Notwithstanding the foregoing, they may purchase public shares in compliance with the requirements of Rule 14e-5 under the Exchange Act, which would not be voted in favor of approving the business combination transaction. Our initial shareholders will enter into agreements with us pursuant to which they will agree to waive their redemption rights with respect to their founder shares and private shares held by them in connection with any amendment to the provisions of our amended and restated memorandum and articles of association relating to our pre-initial business combination activity and related shareholders rights. Release of funds in trust account on closing of our initial business combination On the completion of our initial business combination, the funds held in the trust account will be used to pay amounts due to any public shareholders who exercise their redemption rights as described above under "Redemption rights for public shareholders upon completion of our initial business combination," to pay all or a portion of the consideration payable to the target or owners of the target of our initial business combination and to pay other expenses associated with our initial business combination. If our initial business combination is paid for using equity or debt securities, or not all of the funds released from the trust account are used for payment of the consideration in connection with our initial business combination, we may apply the balance of the cash released to us from the trust account for general corporate purposes, including for maintenance or expansion of operations of post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, to fund the purchase of other companies or for working capital. 45 Table of Contents Redemption of public shares and distribution and liquidation if no initial business combination We will have only 24 months from the closing of this offering to complete our initial business combination (as such period may be extended by shareholder approval to amend our amended and restated memorandum and articles of association to extend the date by which we must consummate our initial business combination). If we are unable to complete our initial business combination within such period, we will: (1) cease all operations except for the purpose of winding up; (2) as promptly as reasonably possible but not more than ten (10) business days thereafter, redeem the outstanding public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable and up to $100,000 of interest to pay dissolution expenses), divided by the number of then issued and outstanding public shares, which redemption will completely extinguish public shareholders rights as shareholders (including the right to receive further liquidating distributions, if any), subject to applicable law; and (3) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our Board of Directors, dissolve and liquidate, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable law. We may, however, raise funds through the issuance of equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements or backstop arrangements we may enter into following consummation of this offering, in order to, among other reasons, satisfy such net tangible assets or minimum cash requirements. There will be no redemption rights or liquidating distributions with respect to our warrants, which will expire worthless if we fail to complete our initial business combination within the completion window. Our initial shareholders have entered into agreements with us, pursuant to which they have waived their rights to liquidating distributions from the trust account with respect to their founder shares and private shares if we fail to complete our initial business combination within 24 months from the closing of this offering. However, if our initial shareholders or management team acquire public shares in or after this offering, they will be entitled to liquidating distributions from the trust account with respect to such public shares if we fail to complete our initial business combination within the 24-month time frame. Conflicts of interest Our team, in their capacities as directors, officers or employees of our Sponsor or its affiliates or in their other endeavors, may choose to present potential business combinations to the related entities described above, current or future entities affiliated with or managed by our Sponsor, or third parties, before they present such opportunities to us, subject to their fiduciary duties under Cayman Islands law. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which (a) may be a corporate opportunity for any director or officer, on the one hand, and us, on the other or (b) the presentation of which would breach an existing legal obligation of a director or officer to any other entity. However, because the other entities to which our officers and directors currently owe fiduciary duties or contractual obligations are not themselves in the business of engaging in business combinations, we do not believe that any such potential conflicts would materially affect our ability to complete our initial business combination. In addition, our amended and restated memorandum and articles of association will contain provisions to exculpate and indemnify, to the maximum extent permitted by law, such persons in respect of any liability, obligation or duty to the Company that may arise as a consequence of such persons becoming aware of any business opportunity or failing to present such business opportunity. For more information, see the section entitled "Management and Advisors — Conflicts of Interest." 46 Table of Contents Our directors and officers presently have, and any of them in the future may have, additional, fiduciary or contractual obligations to other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entity. Accordingly, if any of our directors or officers becomes aware of a business combination opportunity that is suitable for an entity to which he or she has then-current fiduciary or contractual obligations, he or she may need to honor these fiduciary or contractual obligations to present such business combination opportunity to such entity, or in the case of a non-compete restriction, may not present such opportunity to us at all. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by law: (i) no individual serving as a director or an officer, among other persons, shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us; and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which (a) may be a corporate opportunity for any director or officer, on the one hand, and us, on the other or (b) the presentation of which would breach an existing legal obligation of a director or officer to any other entity. As a result, the fiduciary duties or contractual obligations of our officers or directors could materially affect our ability to complete our initial business combination. Our sponsor, officers or directors may sponsor or form other special purpose acquisition companies similar to ours or may pursue other business or investment ventures during the period in which we are seeking an initial business combination. As a result, our sponsor, officers and directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other special purpose acquisition company with which they may become involved. Our sponsor, officers and directors have complete discretion, subject to applicable fiduciary duties, as to which blank check company they choose to pursue a business combination and the order in which they pursue business combinations for any future blank check companies. As a result, our sponsor, officers and directors may pursue business combinations for blank check companies that it may sponsor in any order, which could result in its more recent blank check companies completing business combinations prior to its blank check companies that were launched earlier. Any such companies, businesses or investments may present additional conflicts of interest in pursuing an initial business combination target. Our sponsor and members of our management team will directly or indirectly own our securities following this offering, and accordingly, they may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination, including the fact that they may lose their entire investment in us if our initial business combination is not completed, except to the extent they receive liquidating distributions from assets outside the trust account. Upon the closing of this offering, our sponsor will have invested in us an aggregate of $5,025,000 (assuming no exercise of the underwriters over-allotment option), comprised of the $25,000 purchase price for the founder shares (or approximately $0.003 per share) and the $5,000,000 purchase price for the private units (or $10.00 per unit). Accordingly, our management team may be more willing to pursue a business combination with a riskier or less-established target business than would be the case if our sponsor had paid the same per share price for the founder shares as our public shareholders paid for their public shares, as our sponsor and members of our management team would likely not receive any financial benefit unless we consummated such business combination. These interests of our officers and directors may affect the consideration paid, terms, conditions and timing relating to a business combination in a way that conflicts with the interests of our public shareholders. 47 Table of Contents Additionally, the personal and financial interests of our directors and officers may influence their motivation in timely identifying and pursuing an initial business combination or completing our initial business combination. The different timelines of competing business combinations could cause our directors and officers to prioritize a different business combination over finding a suitable acquisition target for our business combination. For example, if two targets are being evaluated by our management team, and one is more stable and has a better risk or stability profile for our public shareholders, but may take a longer time to diligence and go through the business combination process, while the other has a less favorable risk or stability profile for our public shareholders, but would be easier, quicker and more certain to guide through the business combination process, our management team may decide to choose what they believe to be the quicker and more certain path despite its less favorable risk or stability profile for our public shareholders, as our management team would likely not receive any financial benefit unless we consummated a business combination. Additionally, if members of our management team form other special purpose acquisition companies similar to ours or pursue other business or investment ventures during the period in which we are seeking an initial business combination, the consideration paid, terms, conditions and timing relating to the business combinations of such other special purpose acquisition companies or ventures, and the level of attention paid to by members of our management team to them versus the level of attention paid to us may conflict in a way that is unfavorable to us. Consequently, our directors and executive officers discretion in identifying and selecting a suitable target business may result in a conflict of interest when determining whether the terms, conditions and timing of a particular business combination are appropriate and in our shareholders best interest, which could negatively impact the timing for a business combination. In addition to the above, our officers and directors are not required to commit any specified amount of time to our affairs, and, accordingly, may have conflicts of interest in allocating management time among various business activities, including selecting a business combination target and monitoring the related due diligence. Additionally, our sponsor and executive officers and directors have agreed to waive their redemption rights with respect to any founder shares and any public shares held by them in connection with the consummation of our initial business combination. Further, our sponsor and executive officers and directors have agreed to waive their redemption rights with respect to any founder shares held by them if we are unable to complete our initial business combination and do not hold a shareholder vote to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to consummate an initial business combination within 24 months from the closing of this offering, or by such earlier liquidation date as our board of directors may approve. If we do not complete our initial business combination within such applicable time period, the proceeds of the sale of the private units held in the trust account will be used to fund the redemption of our public shares, and the private units may expire worthless. With certain limited exceptions, the founder shares, purchased by our sponsor for an aggregate of $25,000, will not be transferable, assignable or salable by our sponsor or its permitted transferees until six months after the completion of our initial business combination. With certain limited exceptions, the private units (including the Class A ordinary shares comprising part of the private units and the Class A ordinary shares underlying the private warrants) and the Class A ordinary shares underlying such warrants, will not be transferable, assignable or salable by our sponsor or its permitted transferees until 30 days after the completion of our initial business combination. Since our sponsor and executive officers and directors may directly or indirectly own ordinary shares and warrants following this offering, our executive officers and directors may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination because of their financial interest in completing an initial business combination within 24 months from the closing of this offering or by such earlier liquidation date as our board of directors may approve. 48 Table of Contents In the event our sponsor or members of our management team provide loans to us to finance transaction costs and/or incur expenses on our behalf in connection with an initial business combination, such persons may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination as such loans may not be repaid and/or such expenses may not be reimbursed unless we consummate such business combination. Similarly, if we agree to pay our sponsor or a member of our management team or one of their affiliates a finder s fee, advisory fee, consulting fee or success fee in order to effectuate the completion of our initial business combination, such persons may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination as any such fee may not be paid unless we consummate such business combination. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers, directors or the non-managing sponsor investors, or any of their respective affiliates or completing the business combination through a joint venture or other form of shared ownership with our sponsor, officers or directors or the non-managing sponsor investors or any of their respective affiliates; accordingly, such affiliated person(s) may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination as such affiliated person(s) would have interests different from our public shareholders and would likely not receive any financial benefit unless we consummated such business combination. In the event we seek to complete our initial business combination with a company that is affiliated (as defined in our amended and restated memorandum and articles of association) with our sponsor, officers or directors, we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions, stating that the consideration to be paid by us in such an initial business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other context. We do not believe, however, based on the other companies with which our directors and officers are affiliated and their respective businesses, that the fiduciary duties or contractual obligations of our directors or officers will materially affect our ability to identify and pursue business combination opportunities or complete our initial business combination. See "Risk Factors — Risks Related to our Team and Their Respective Affiliates and to the Post-Business Combination Company — Certain of our directors and officers are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented." 49 Table of Contents Our Sponsor is managed by its two directors, Charles T. Cassel III and Vikas Mittal and is beneficially owned (i) 51% by Samara CSLM LLC and (ii) 49% by Consilium Investment Capital, Inc. Consilium Investment Capital, Inc. is owned 50% by Mr. Cassel and 50% by Mr. Binder. Samara CSLM LLC is solely owned by Vikas Mittal and his immediate family. The economic interests of our Sponsor are currently 100% owned by Samara CSLM LLC and Consilium Investment Capital Inc. As a result, Mr. Cassel, Mr. Binder, and Mr. Vittal may exert a substantial influence on other actions requiring a shareholder vote, potentially in a manner that you do not support, including appointment and the removal of our directors, amendments to our amended and restated memorandum and articles of association and approval of major corporate transactions. If our Sponsor purchases any Class A ordinary shares in this offering or in the aftermarket or in privately negotiated transactions, this would increase their influence over such actions. See "Risk Factors — Risks Related to our Team and Their Respective Affiliates and to the Post-Business Combination Company." Vikas Mittal and Jonathan M. Binder, serve on our board of directors. Mr. Cassel is our Chief Executive Officer, Mr. Mittal is our Chairman and Chief Financial Officer. As a result, Mr. Cassel, Mr. Binder, Mr. Vittal and the Consilium affiliates may exert a substantial influence on actions requiring shareholder vote, potentially in a manner that you do not support, and their interests may differ from your interests. We do not believe, however, that the duties and obligations of the Consilium affiliates will materially affect our ability to identify and pursue business combination opportunities or complete our initial business combination Consilium may become aware of a potential business combination opportunity that may be an attractive opportunity for our Company. Consilium and our Company may each assess opportunities within Frontier Growth Markets. In particular, CIM manages two products targeted at Frontier Growth Markets. The Fund focuses on listed equities opportunities within Frontier Growth Markets. EOF focuses on less liquid opportunities within Frontier Growth Markets, and targets a three-year time horizon to extract value from companies that are relatively unknown. Consilium is not under any obligation to source any potential opportunities for our initial business combination or refer any such opportunities to our Company or provide any other services to our Company. Consilium s role with respect to our company is expected to be advisory in nature. Consilium does not have any written agreement with the Company and is not being paid any fees. Consilium may have fiduciary and/or contractual duties to its investment vehicles and to companies in which Consilium has invested. As a result, Consilium may have a duty to offer business combination opportunities to certain Consilium funds, other investment vehicles or other entities before other parties, including our Company. Additionally, certain companies in which Consilium or Meteora has invested may enter into transactions with, provide goods or services to, or receive goods or services from an entity with which we seek to complete our initial business combination. Transactions of these types may present a conflict of interest because Consilium may directly or indirectly receive a financial benefit as a result of such transaction. Neither CIM nor Meteora is being compensated by us for the general diligence, administrative, and advisory support it will provide in the sourcing of potential targets for our initial business combination or in its general role as advisor. We believe that any such potential conflicts of interest of Consilium and Meteora will be naturally mitigated by the differing nature of targets that Consilium and Meteora typically consider most attractive for its activities and the types of initial business combination opportunities that we expect to be most attractive for our Company. Other Funds Funds and accounts managed by, or otherwise affiliated with, our Sponsor may participate in this offering and purchase units at the offering price. These affiliated funds are not obligated to participate, and the extent of their participation may be significant relative to the overall size of the offering. As a result, a substantial portion of the units sold in this offering may be held by affiliates of the Sponsor. None of these affiliated funds have expressed an interest in purchasing more than 9.9% of the public units to be sold in this offering, except that Meteora and its affiliates have expressed an interest in acquiring up to 19.99% of the public units to be sold in this offering. Any participation by affiliated entities may reduce the available public float of our securities, which could limit liquidity in the market for our units, Class A ordinary shares, or warrants following the offering. Meteora, for which Mr. Mittal serves as the Managing Member and Chief Investment Officer, and Consilium or their affiliates may also purchase additional public shares which they have agreed to vote in favor of an initial business combination, thereby increasing the increase the likelihood that a proposed shareholder resolution to approve our initial business combination will be passed (whether by way of ordinary resolution or special resolution). If the affiliated funds purchase the full amount of the units for which they have expressed an interest and vote in favor of an initial business combination, we may not need any public shares sold to other investors in this offering to be voted in favor of the initial business combination. Accordingly, we may complete our initial business combination even if holders of a majority of our public ordinary shares do not approve of the business combination we complete. Additionally, because these affiliated purchasers may have different investment horizons, liquidity needs, or strategic interests than other investors, their participation may not align with the interests of unaffiliated public shareholders. Furthermore, to the extent that affiliated entities hold a material portion of the units and subsequently choose to redeem their public shares in connection with our initial business combination, this could reduce the amount of cash available to the combined company. 50 Table of Contents Summary of Risk Factors We are a newly incorporated company that has conducted no operations and has generated no revenues. Until we complete our initial business combination, we will have no operations and will generate no operating revenues. In making your decision whether to invest in our securities, you should take into account not only the background of our team, but also the special risks we face as a blank check company. This offering is not being conducted in compliance with Rule 419 promulgated under the Securities Act. Accordingly, you will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. For additional information concerning how Rule 419 blank check offerings differ from this offering, please see "Proposed Business — Comparison of This Offering to Those of Blank Check Companies Subject to Rule 419." You should carefully consider these and the other risks set forth in the section entitled "Risk Factors" beginning on page 55 of this prospectus. An investment in our securities involves a high degree of risk. You should consider carefully all of the risks described below, together with the other information contained in this prospectus, before making a decision to invest in our units. If any of the following events occur, our business, financial condition and operating results may be materially adversely affected. In that event, the trading price of our securities could decline, and you could lose all or part of your investment. Such risks include, but are not limited to: We are a newly incorporated company with no operating history and no revenues, and you have no basis on which to evaluate our ability to achieve our business objective. Past performance of Consilium, Meteora, our team and their respective affiliates may not be indicative of future performance of an investment in the Company. Our public shareholders may not be afforded an opportunity to vote on our proposed business combination, which means we may complete our initial business combination even though a majority of our public shareholders do not support such a combination. If we seek shareholder approval of our initial business combination, our initial shareholders, directors and officers have agreed to vote in favor of such initial business combination, regardless of how our public shareholders vote. Your only opportunity to affect the investment decision regarding a potential business combination will be limited to the exercise of your right to redeem your shares from us for cash, unless we seek shareholder approval of such business combination. If we seek shareholder approval of our initial business combination, our Sponsor, directors, officers, advisors or any of their respective affiliates may elect to purchase shares or warrants from public shareholders, which may influence a vote on a proposed business combination and reduce the public "float" of our securities. Our Sponsor will control the appointment and removal of our board of directors until consummation of our initial business combination and will hold a substantial interest in us. As a result, it will appoint all of our directors prior to the consummation of our initial business combination and may exert a substantial influence on actions requiring a shareholder vote, potentially in a manner that you do not support. You will not be entitled to certain protections afforded to investors of some other blank check companies. You will not have any rights or interests in funds from the trust account, except under certain limited circumstances. To liquidate your investment, therefore, you may be forced to sell your public shares and/or warrants, potentially at a loss. If the net proceeds of this offering and the sale of the private units not being held in the trust account are insufficient, it could limit the amount available to fund our search for a target business or businesses and complete our initial business combination and we may depend on loans from our Sponsor or management team to fund our search, to pay our taxes and to complete our initial business combination. If we have not completed our initial business combination within 24 months of the closing of this offering, our public shareholders may be forced to wait beyond such 24 months before redemption from our trust account. The grant of registration rights to our initial shareholders and their permitted transferees may make it more difficult to complete our initial business combination, and the future exercise of such rights may adversely affect the market price of our Class A ordinary shares. 51 Table of Contents The ability of our public shareholders to redeem their shares for cash may make our financial condition unattractive to potential business combination targets, which may make it difficult for us to enter into a business combination with a target and may not allow us to complete the most desirable business combination or optimize our capital structure. We are not required to obtain an opinion from an independent investment banking firm or from an independent accounting firm regarding fairness. Consequently, you may have no assurance from an independent source that the price we are paying for the business is fair to our Company from a financial point of view. Nasdaq may delist our securities from trading on its exchange, which could limit investors ability to make transactions in our securities and subject us to additional trading restrictions. The nominal purchase price paid by our Sponsor for the founder shares may result in significant dilution to the implied value of your public shares upon the consummation of our initial business combination, and our Sponsor is likely to make a substantial profit on its investment in us in the event we consummate an initial business combination, even if the business combination causes the trading price of our Class A ordinary shares to materially decline. We may not be able to complete our initial business combination within the prescribed time frame, in which case we would cease all operations except for the purpose of winding up and we would redeem our public shares and liquidate, in which case our public shareholders may receive only $10.00 per share, or less than such amount in certain circumstances, and our warrants will expire worthless. We may engage in a business combination with one or more target businesses that have relationships with entities that may be affiliated with our Sponsor, directors or officers which may raise potential conflicts of interest. Since our initial shareholders will lose their entire investment in us if our initial business combination is not completed, a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination. Our directors and officers will allocate their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs. This conflict of interest could have a negative impact on our ability to complete our initial business combination. Certain of our directors and officers are now, and all of them may in the future become, affiliated with entities engaged in business activities similar to those intended to be conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity should be presented. Our directors, officers, security holders and their respective affiliates may have competitive pecuniary interests that conflict with our interests. Changes in laws or regulations, or a failure to comply with any laws and regulations, may adversely affect our business, including our ability to negotiate and complete our initial business combination, and results of operations. Our search for an initial business combination, and any target business with which we may ultimately consummate an initial business combination, may be materially adversely affected by current global geopolitical conditions resulting from the ongoing Russia-Ukraine conflict and the recent escalation of the conflict in the Middle East and Southwest Asia. We identified a material weakness in our internal control over financial reporting and may identify additional material weaknesses in the future, or fail to maintain an effective system of internal control over financial reporting, which may result in material misstatements of our financial statements or cause us to fail to meet our periodic reporting obligations. The other risks and uncertainties discussed in "Risk Factors" and elsewhere in this prospectus. 52 Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2025/KWMWW_k-wave_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/KWMWW_k-wave_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/KWMWW_k-wave_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/KYIVW_kyivstar_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/KYIVW_kyivstar_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/KYIVW_kyivstar_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2025/KZIA_kazia_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/KZIA_kazia_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..07c060eebc0813b5267a45bc2bfc70d1982a0a8a
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/KZIA_kazia_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights selected information about us and information contained in greater detail elsewhere in this prospectus, and in the documents incorporated by reference herein. This summary is not complete and does not contain all of the information that you should consider before investing in the Offered ADSs. You should carefully read and consider this entire prospectus and information incorporated by reference into this prospectus, including the financial statements and related notes and Risk Factors starting on page 9 of this prospectus, before making an investment decision. If you invest in our securities, you are assuming a high degree of risk. Overview We are an emerging oncology-focused biotechnology company that has a portfolio of development candidates, diversified across several distinct technologies, with the potential to yield first-in-class and best-in-class agents in a range of oncology indications. Our lead development candidate is paxalisib (formerly known as GDC-0084), a small-molecule, brain-penetrant inhibitor of the PI3K / Akt / mTor pathway, that is being developed as a potential therapy for glioblastoma, the most common and most aggressive form of primary brain tumour in adults, as well advanced breast cancer and as other forms of brain cancer. Our second asset is EVT801, a small-molecule selective inhibitor of vascular endothelial growth factor receptor 3, which we licensed from Evotec SE in April 2021. Recent Developments On December 2, 2025, we entered into Securities Purchase Agreements (the December 2025 Securities Purchase Agreements ) with certain institutional and accredited purchasers (the Purchasers ) in connection with a private placement of equity securities (the December 2025 Private Placement ). Pursuant to the December 2025 Securities Purchase Agreements, we agreed to offer and sell in the December 2025 Private Placement to such Purchasers (i) 4,530,854,000 ordinary shares of the Company, no par value per share (the Ordinary Shares, and such Ordinary Shares to be offered and sold in the December 2025 Private Placement, the December 2025 Shares ), at a purchase price of $0.01 per December 2025 Share, and (ii) pre-funded warrants (the December 2025 Pre-Funded Warrants ) to purchase up to 938,490 American Depositary Shares (the ADSs ), each ADS representing five hundred Ordinary Shares, at a purchase price of $4.9999 per December 2025 Pre-Funded Warrant. Each December 2025 Pre-Funded Warrant is exercisable for one ADS at an exercise price of $0.0001 per ADS underlying the December 2025 Pre-Funded Warrant (the December 2025 Pre-Funded Warrant ADS ), is immediately exercisable, and will expire when exercised in full. Konik Capital Partners LLC, a division of T.R. Winston & Company, served as the placement agent for the December 2025 Private Placement (the Placement Agent ). In addition, the Company issued to the Placement Agent warrants to purchase up to 700,013 ADSs (the December 2025 Placement Agent Warrants ). The December 2025 Placement Agent Warrants have an exercise price equal to $7.50 per ADS, or 150% of the offering price per ADS sold in the December 2025 Private Placement, and are exercisable commencing on the date that is 180 days after December 2, 2025 and will expire 5 years from December 2, 2025. The closing of the December 2025 Private Placement occurred on December 3, 2025. We issued the December 2025 Shares and the December 2025 Pre-Funded Warrants in exchange for net proceeds of approximately $46.5 million, after deducting placement agent s fees and other offering expenses payable by the Company. We expect the net proceeds from the December 2025 Private Placement, combined with the existing cash and cash equivalents, will extend our cash runway into the second half of 2028. In addition, on November 12, 2025, we received a staff determination letter ( Staff Letter ) from the Listing Qualifications department (the Staff ) of The Nasdaq Stock Market LLC ( Nasdaq ), indicating that as of November 10, 2025, our Market Value of Listed Securities ( MVLS ) remained below the minimum of Table of Contents $35 million required for continued listing on The Nasdaq Capital Market pursuant to Nasdaq Listing Rule 5550(b)(2). Pursuant to the Nasdaq Listing Rules and the Staff Letter, unless we timely request a hearing before a Hearings Panel (the Panel ), our securities would be subject to suspension/delisting. We timely requested a hearing before the Panel, which was scheduled for January 8, 2026. On December 18, 2025, we received a letter from the Nasdaq Office of General Counsel notifying us that we have regained compliance with Listing Rule 5550(b)(1), the alternative $2.5 million minimum stockholders equity requirement to the MVLS requirement, and that we are now in compliance with all the applicable listing standards. Accordingly, the hearing was considered moot and cancelled, and Nasdaq has determined to continue the listing of our ADSs on The Nasdaq Capital Market. Corporate Information Kazia Therapeutics Limited (formerly Novogen Limited) was incorporated in Australia in 1994. The ADSs each representing 500 fully paid Ordinary Shares, are listed on the Nasdaq Capital Market under the symbol KZIA . The Depositary for the ADSs is The Bank of New York Mellon, 240 Greenwich Street, New York, NY 10286. Our principal executive offices are located at Level 24, Three International Towers, 300 Barangaroo Avenue, Sydney, NSW, 2000, Australia. Our telephone number is +61-2-9472-4101. Our corporate email address is info@kaziatherapeutics.com. Our website address is www.kaziatherapeutics.com. Information on our website and the websites linked to it do not constitute part of this prospectus or the registration statement to which this prospectus forms a part. Our agent for service of process in the United States is Vcorp Services, LLC, 25 Robert Pitt Drive, Suite 204, Monsey, New York 10952. Implications of Being a Foreign Private Issuer We report under the Exchange Act as a non-U.S. company with foreign private issuer status. As long as we qualify as a foreign private issuer under the Exchange Act, we will continue to be exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies, including: the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations with respect to a security registered under the Exchange Act; the requirement to comply with Regulation FD, which requires selective disclosure of material information; the sections of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q containing unaudited financial and other specified information, or current reports on Form 8-K upon the occurrence of specified significant events. Foreign private issuers are also exempt from certain more stringent executive compensation disclosure rules. Thus, as long as we remain a foreign private issuer, we will continue to be exempt from the more stringent compensation disclosures required of companies that are neither an emerging growth company nor a foreign private issuer. As a result, some investors may find the ADSs less attractive, which could result in a less active trading market for the ADSs or more volatility in the price of the ADSs. Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2025/LDTDF_leddartech_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/LDTDF_leddartech_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/LDTDF_leddartech_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/LGN_legence_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/LGN_legence_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/LGN_legence_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2025/LGVN_longeveron_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/LGVN_longeveron_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/LGVN_longeveron_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/LHI_living_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/LHI_living_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/LHI_living_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/LHSW_lianhe_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/LHSW_lianhe_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/LHSW_lianhe_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/LIFE_ethos_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/LIFE_ethos_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/LIFE_ethos_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/LUDG_ludwig_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/LUDG_ludwig_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..92c2e4025f1d0aae27944a72f8cc545a51787093
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/LUDG_ludwig_prospectus_summary.txt
@@ -0,0 +1 @@
+prospectus summary. These risks and uncertainties include, but are not limited to, the following: We are an early-stage genomics technology and health related company without any products or services currently available for sale and we may not be able to successfully develop or bring products or services to market; The report of our independent auditors on our financial statements for the years ended December 31, 2024, and December 31, 2023, indicate uncertainty concerning our ability to continue as a going concern and this may impair our ability to raise capital to fund our business; We have incurred significant losses in prior periods, and losses in the future could cause the quoted price of our Common Stock to decline or have a material adverse effect on our financial condition, our ability to pay our debts as they become due, and on our cash flows; We have limited experience in dealing with third-party manufacturers or commercializing proposed product candidates and may encounter difficulties, delays or other unanticipated hurdles before the manufacturing of our product candidates begin in the quantities needed to achieve our business plans; We are dependent upon our officers and directors for future success; We are dependent upon the successful completion of our capital campaign We use RNA-based molecular biology in our products and services pipeline and the successful commercialization of these products will depend on public perceptions of RNA-based products; If the FDA were to begin actively regulating our tests, we could incur substantial costs and delays associated with trying to obtain premarket clearance or approval and incur costs associated with complying with post-market controls; We may not be successful in commercializing our product candidates; We are in competition with companies that are larger, more established and better capitalized than are we; The materials used in the processes by which our RNA-based products and our derivative products are manufactured, such as mRNA genetic microarrays, may become difficult to obtain in the quality or quantity required for our business plans or at the prices that are currently projected; If we are unable to obtain and maintain protection of our intellectual property, which are costly to maintain, the value of our products may be adversely affected; and Corporate Information The Company was originally organized as a Kentucky corporation on February 11, 1988. On February 8, 2006, we formed a wholly owned subsidiary, Ludwig Enterprises, Inc., a Nevada corporation. On March 28, 2006, Ludwig Enterprises, Inc., the Kentucky corporation, merged with and into Ludwig Enterprises, Inc., the Nevada corporation, with the Company, Ludwig Enterprises, Inc., the Nevada corporation, being the surviving entity. Our principal executive offices, and those of our subsidiaries, are located at 8950 SW 74th Ct, Ste 2201-A149, Miami, FL 33156. Our phone number is (786) 235-9026. Our corporate website is located at www.ludwigent.com. Information on our website is not part of this prospectus. 4 The Offering Common Stock offered by us shares of Common Stock (or shares if the underwriters exercise the over-allotment option in full). See Capitalization. Shares of Common Stock outstanding prior to the Offering(1) 162,569,807 shares (without giving effect to the reverse stock split described below)(1) Shares of Common Stock to be outstanding after the Offering(1) shares (without giving effect to the reverse stock split and shares if over-allotment option is exercised in full)(1) Offering price $ per share Over-allotment Option We have granted to the underwriter(s) an option, which is exercisable within 45 days from the date of this prospectus, to purchase up to an additional shares of Common Stock at the public offering price of $ per share, less the underwriting discounts and commissions, solely to cover over-allotments, if any. Reverse Stock Split On June 16, 2024, our Board authorized, a proposal authorizing our Board to effect a reverse split of our outstanding Common Stock at a specific ratio within a range from one-for-50 to one-for-250, and also granted authorization to our Board to determine, in its sole discretion, the specific ratio within that range and timing of such reverse stock split, and the filing of an amendment to our Articles of Incorporation with the Nevada Secretary of State to effect such reverse stock split. We expect the reverse stock split to take effect prior to the consummation of this Offering. The purpose of the reverse stock split is to allow us to meet the stock price threshold of the listing requirements of the . The Company has not yet decided on the specific ratio of the reverse stock split and as such, there has not been any adjustments to options and per share information. The reverse stock split remains subject to approval of the holders of a majority of our outstanding voting securities and by the Financial Industry Regulatory Authority ( FINRA ). There is no guarantee that the Company will receive the requisite stockholder approval or be successful in achieving FINRA s approval or that will approve our listing application. See Description of Securities and Risks Related to This Offering and The Reverse Stock Split for additional information regarding the reverse stock split and other matters related to our Common Stock. 5 Market for the Common Stock; Proposed Listing Our Common Stock is quoted on the OTCID under the symbol LUDG. As of , 2025, the last reported sale price for our Common Stock was $ per share. Prior to this Offering, there has been a limited market for our securities. While our Common Stock is quoted on the OTCID, there has been negligible trading volume. In connection with this Offering, we intend to apply to have our Common Stock listed on the under the symbol This Offering will not be consummated until we have received approval of our application. There is no assurance that a trading market will develop or, if developed, that it will be sustained. Consequently, purchasers of our Common Stock may find it difficult to resell the securities offered herein should the purchasers desire to do so when eligible for public resale. Use of Proceeds We estimate that the net proceeds to us from the sale of shares of our Common Stock in this offering will be approximately $ (or approximately $ if the representative of the underwriters exercises its over-allotment option in full), at the assumed public offering price of $ per share, after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us. We intend to use the proceeds from this offering on equipment, marketing, staffing, legal expenses, accounting expense, company awareness, research and clinical trials, debt repayment and the exercise of an option to buy back certain shares of our Common Stock. See Use of Proceeds for a complete description of how we intend to use the of proceeds this Offering. Risk Factors See Risk Factors and the other information in this prospectus for a discussion of the factors you should consider before deciding to invest in shares of our Common Stock. (1) The number of shares of our Common Stock outstanding prior to and after this offering is based on 162,569,807 shares outstanding as of September 17, 2025, and excludes or does not give effect to: The above-mentioned proposed reverse stock split; Outstanding warrants to purchase 2,080,000 shares of Common Stock at $0.30 per share; Outstanding warrants to purchase 2,604,667 shares of Common Stock at $0.19 per share; 30,000,000 shares of Common Stock reserved for future issuance of awards pursuant to our Stock Incentive Plan. See Executive Compensation - Equity Compensation Plan Information below. Unless otherwise indicated, all information in this prospectus assumes or gives effect to: The conversion of all outstanding shares of Convertible Preferred Stock into a total of 700,000,000 shares of Common Stock; The partial conversion of the Convertible Notes into up to 19,133,222 shares of Common Stock; No exercise of the Representative Warrants to be issued upon consummation of this offering; and No exercise of the Representative s over-allotment option. 6 Summary Consolidated Financial Information The following tables summarize certain financial data regarding our business and should be read in conjunction with our financial statements and related notes contained elsewhere in this prospectus and the information under Management s Discussion and Analysis of Financial Condition and Results of Operations, as well as our financial statements and related notes appearing elsewhere in this prospectus. We derived the summary financial information from our unaudited financial statements and related notes for the six months ended June 30, 2025 and 2024, and our year-end financial statements and related notes for the years ended December 31, 2024 and 2023, appearing elsewhere in this prospectus. All financial statements included in this prospectus are prepared and presented in accordance with generally accepted accounting principles in the United States. The financial statements contained elsewhere fully represent our financial condition and operations; however, they are not indicative of our future performance. Six Months Ended June 30, 2025 (unaudited) Six Months Ended June 30, 2024 (unaudited) Statements of Operations Data: Revenue $- $10 Total Operating Expenses 1,110,543 666,937 Loss From Operations (1,110,543) (666,927) Other income (expense) Interest income 4.000 - Other income 2,333 - Amortization of debt discount (115,129) (15,000) Interest expense (26,560) (21,797) Loss on extinguishment of debt (117,217) - Change in fair value of derivative 172,729 - Finance Expense - (677,130) Inducement expense Gain on debt extinguishment - (520,000) Total other income (expense) - net (79,844) (1,233,927) Net loss $(1,190,387) $(1,975,071) 7 Year Ended December 31, 2024 Year Ended December 31, 2023 Statements of Operations Data: Revenue $217 $- Total Operating Expenses 1,298,406 1,375,761 Loss From Operations (1,298,189) (1,375,761) Other income (expense) Amortization of debt discount (15,000) (469,514) Inducement expense (1,004,574) (517,464) Interest expense (56,794) (15,714) Finance expense (677,130) - Total other income (expense) - net (1,753,498) (1,002,682) Income (loss) from discontinued operation, net of tax 34,803 (78,107) Net loss $(3,016,884) $(2,456,550) June 30 2025 (Unaudited) Pro Forma Pro Forma Ad Adjusted Consolidated Balance Sheets Assets Current Assets $400,654 $ $ Total Assets $401,274 $ $ Liabilities and Stockholder s Deficit Current Liabilities $3,803,434 $ $ Total Liabilities 3,803,434 Stockholders Deficit Preferred stock: 7,000,000 authorized; $0.001 par value, 7,000,000 shares issued and outstanding 7,000 Common stock: 1,250,000,000 authorized; $0.001 par value, 159,912,808 and 155,464,808 shares issued and outstanding, respectively 161,568 Additional Paid In Capital 4,879,025 Accumulated Deficit (8,447,753) Total Stockholders Deficit (3,402,160) Total Liabilities and Stockholders Deficit $401,274 $ $ 8 RISK FACTORS An investment in our shares of Common Stock involves significant risks. Before making an investment in our shares of Common Stock, you should carefully consider the risks and uncertainties discussed below under Information Regarding Forward-Looking Statements, and the specific risks set forth herein. Any of the following risks could have a material adverse effect on our business, financial condition and results of operations. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially and adversely affect our business, prospects, financial condition, results of operations, cash flows and ability to pay dividends. In any such case, the market price of our shares of Common Stock could decline, and you may lose all or part of your investment. Risks Related to the Company We are an early-stage genomics technology and health related Company without any products or services currently available for sale and we may not be able to successfully develop or bring products or services to market. We have several product and service candidates, including our proprietary mRNA genetic program that we intend to begin marketing by the fourth quarter of 2025; however, there is no assurance that we will succeed in bringing any of our product and service candidates to market or that such product candidates, or any of our other operations, will generate any revenue. If we cannot develop a marketable product or generate sufficient revenues, we may be required to suspend or cease operations. Our business operations have only a limited history upon which an evaluation of our prospects and future performance can be made. The Company s operations are subject to all business risks associated with development stage enterprises. The likelihood of the Company s success must be considered in light of the problems, expenses, difficulties, complications and delays frequently encountered in connection with the establishment and expansion of a business, operation in a competitive industry and the necessary continued development of advertising and other marketing strategies. We believe it is likely that we will continue to sustain losses throughout the next twelve months. We cannot assure you that we will ever operate profitably. Additionally, we have a limited operating history, and as a result our historical financial and other operating data may be of limited value in estimating future operating revenue, revenue sources and expenses. Our budgeted expense levels are based in part on our expectations concerning future revenue and future revenue sources. The amount and sources of these revenues will depend on the success of our ability to establish the commercial viability of our new products, to sustain our marketing efforts, the perception of our products by customers and users, and other factors that are difficult to forecast accurately. Our internal controls may be inadequate, which could cause our financial reporting to be unreliable and lead to misinformation being disseminated to the public. Our management is responsible for establishing and maintaining adequate internal control over our financial reporting. As defined in Exchange Act Rule 13a 15(f) (the Exchange Act ), internal control over financial reporting is a process designed by, or under the supervision of, the principal executive and principal financial officer and effected by the Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that: pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and/or directors of the Company; and provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company s assets that could have a material effect on the financial statements. Our internal controls may be inadequate or ineffective, which could cause financial reporting to be unreliable and lead to misinformation being disseminated to the public. Investors relying upon this misinformation may make an uninformed investment decision. Failure to achieve and maintain an effective internal control environment could cause us to face regulatory action and also cause investors to lose confidence in our reported financial information, either of which could have a material adverse effect on the Company s business, financial condition, results of operations and future prospects. 9 However, our auditors will not be required to formally attest to the effectiveness of our internal control over financial reporting pursuant to Section 404 until we are no longer an EGC if we take advantage of the exemptions available to us through the JOBS Act. Our principal shareholders have significant voting power and may take actions that may not be in the best interests of our other shareholders After this offering, our principal shareholders will hold in aggregate approximately % of our shares, assuming that the number of shares of Common Stock set forth on the cover page of this prospectus are issued and sold in this Offering. We are not considered a controlled company under corporate governance rules as we do not currently expect that more than 50% of our voting power will be held by an individual, a group or another company, these shareholders, however, if they act together, will be able to control the management and affairs of our company and most matters requiring shareholder approval, including the election of directors and approval of significant corporate transactions. The interests of these shareholders may not be the same as or may even conflict with your interests. For example, these shareholders could attempt to delay or prevent a change in control of us, even if such change in control would benefit our other shareholders, which could deprive our shareholders of an opportunity to receive a premium for their shares of Common Stock as part of a sale of us or our assets, and might affect the prevailing market price of our Common Stock due to investors perceptions that conflicts of interest may exist or arise. As a result, this concentration of ownership may not be in the best interests of our other shareholders. The report of our independent auditors on our financial statements for the year ended December 31, 2024, and, in the management s representation on our financial statements for opinion of management, the six months ended June 30, 2025, indicates uncertainty concerning our ability to continue as a going concern and this may impair our ability to raise capital to fund our business. The report of our independent auditors indicates uncertainty concerning our ability to continue as a going concern and this may impair our ability to raise capital to fund our business. In its opinion on our financial statements for the years ended December 31, 2024 and 2023, and for the six months ended June 30, 2025, our independent auditors raised substantial doubt about our ability to continue as a going concern. We cannot assure you that this will not impair our ability to raise capital on attractive terms. Additionally, we cannot assure you that we will ever achieve significant revenues and therefore remain a going concern. Our financial statements do not include any adjustments that might result from the outcome of this uncertainty. The obtainment of additional financing, the successful development of our contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for us to continue operations. These conditions and the ability to successfully resolve these factors over the next twelve months raise substantial doubt about our ability to continue as a going concern. We have incurred significant losses in prior periods, and losses in the future could cause the quoted price of our Common Stock to decline or have a material adverse effect on our financial condition, our ability to pay our debts as they become due, and on our cash flows. To date, we have not generated revenues from our operations, and we have incurred significant losses in prior periods. For the six months ended June 30, 2025 and 2024, we incurred a net loss of $1,190,387 (unaudited) and $1,975,071 (unaudited), respectively, and, as of June 30, 2025, we had an accumulated deficit of $8,449,753 (unaudited). For the years ended December 31, 2024 and 2023, we incurred a net loss of $3,016,884 and $2,456,550, respectively, and, as of such dates, we had an accumulated deficit of $7,259,366 and $4,242,482 respectively. 10 The time required for us to become profitable is highly uncertain, and we cannot assure you that we will achieve or sustain profitability or generate sufficient cash flow from operations to meet our planned capital expenditures, working capital and debt service requirements. If required, our ability to obtain additional financing from other sources also depends on many factors beyond our control, including the state of the capital markets and the prospects for our business. The necessary additional financing may not be available to us or may be available only on terms that would result in further dilution to the current owners of our Common Stock. We expect we will require significant capital in connection with our efforts, and we will be required to continue to make significant investments to further develop and expand our business. In particular, we expect to continue to expend substantial financial and other resources on further research studies, marketing and advertising as part of our strategy to develop and increase our business-to-consumer ( B2C ) channels, as well as on research and development activities regarding our proprietary mRNA genetic methodologies. The sales, marketing and advertising expenses that we will incur will typically be expensed immediately. In addition, to the extent that our business ramps up as we expect, we will need to increase our headcount significantly in the coming years. We intend to seek interim short-term financing to assure full legal compliance with our Securities and Exchange Commission ( SEC ) filings, and to bring on the necessary personnel to begin our future development activities. Our working capital needs will be met largely from the sale of debt and public equity securities, including in this Offering, until such time that funds provided by operations, if ever, are sufficient to fund working capital requirements. The accompanying financial statements do not include any adjustments relating to the recoverability or classification of recorded assets and liabilities that might result should the Company be unable to continue as a going concern. We will require additional capital to fund our operations and if we do not obtain additional capital, we may be required to scale back, delay or cease our operations. Our business does not presently generate the cash needed to finance our current and anticipated operations and we will need to obtain additional financing to finance our operations, until such time that we are able to conduct profitable revenue generating activities. Through the date of this prospectus, we have obtained approximately $2,600,000 in loans to meet our ongoing expenses, including professional fees and day-to-day operating expenses. We cannot assure you that adequate financing will be available on acceptable terms, if at all. Our failure to raise additional financing, including through this Offering, in a timely manner would adversely affect our ability to pursue our business plan and could cause us to delay launching our product and our proposed business plan. We will need additional capital. If additional capital is not available or is available at unattractive terms, we may be forced to delay, reduce the scope of or eliminate our research and development programs, reduce our commercialization efforts or curtail our operations. To develop and bring our product candidates to market, we must commit substantial resources to costly and time-consuming research, clinical and observational staging studies and marketing activities. We anticipate that the proceeds from this offering will increase our existing cash and cash equivalents enough to enable us to maintain our current operations for at least the next 12 months. We anticipate using our cash and cash equivalents to fund further research and development with respect to our product candidates. We will, however, need to raise additional funding sooner if our business or operations change in a manner that consumes available resources more rapidly than we anticipate. Our requirements for additional capital will depend on many factors, including: the time and expense for clinical and observational staging studies for our product candidates; the time and costs involved in obtaining regulatory approval for our product candidates, if needed; costs associated with protecting our intellectual property rights; successful commercialization of our product candidates; development of marketing and sales capabilities; payments received under current and future collaborative agreements, if any; and market acceptance of our products. 11 To the extent we raise additional capital through the sale of equity securities, the issuance of those securities could result in dilution to our shareholders. In addition, if we obtain debt financing, a substantial portion of our operating cash flow may be dedicated to the payment of principal and interest on such indebtedness, thus limiting funds available for our business activities. If adequate funds are not available, we may be required to delay, reduce the scope of or eliminate our research and development programs, reduce our commercialization efforts or curtail our operations. In addition, we may be required to obtain funds through arrangements with collaborative partners or others that may require us to relinquish rights to technologies, product candidates or products that we would otherwise seek to develop or commercialize ourselves or license rights to technologies, product candidates or products on terms that are less favorable to us than might otherwise be available. We will require substantial additional funds to support our research and development activities, and the anticipated costs of clinical and observational staging studies, possible regulatory approvals and eventual commercialization. Such additional sources of financing may not be available on favorable terms, if at all. If we do not succeed in raising additional funds on acceptable terms, we may be unable to commence or complete clinical and observational staging studies or, if needed, obtain approval of any product candidates from the FDA and other regulatory authorities. In addition, we could be forced to discontinue product development, forego sales and marketing efforts and forego attractive business opportunities. Any additional sources of financing will likely involve the issuance of our equity securities, which will have a dilutive effect on our shareholders. We may not be successful in raising the additional funds needed to fund our business plan. If we are not able to raise sufficient capital in the near future, our continued operations will be in jeopardy and we may be forced to cease operations and sell or otherwise transfer all or substantially all of our remaining assets. The proceeds from this Offering will not be sufficient to conduct our proposed clinical trials to completion. The proceeds from this offering will not be sufficient to conduct our proposed clinical trials to completion and we will need to raise additional funds to complete them. In the event we are unable to raise additional funds this will have an adverse effect on our business and our ability to bring products to market. The Company has product candidates with very complex and different sales and marketing channels, the development of which will put significant burdens on us and which we may not be able to develop as effectively as competitors. We will have very different sales and marketing channels if the products in our pipeline are to reach customers in their respective markets, either Business to Consumer ( B2C ) or Business to Business ( B2B ) channels, requiring us to develop distinct sales, marketing, and distribution methods. In particular, the B2C channels have different customers and distribution channels as B2B channels. Building, managing and maintaining such a sales and marketing infrastructure may require us to hire experts in the field, implement complex systems, establish collaborations with third parties effectively across various geographies and understand disparate regulatory regimes. Our ability to effectively engage in these steps is untested, making it impossible for us to accurately predict the level of success we will achieve. We have yet to establish sales, marketing or distribution capabilities, and if we are unable to establish these capabilities, we may not be successful in commercializing our product candidates. We have not yet established a sales, marketing or product distribution infrastructure for our product and service candidates, which are still in various stages of development. To achieve commercial success for any product, we will need to establish a sales and marketing organization within the United States and, potentially, also develop a strategy for sales outside of the United States. We intend to outsource the manufacturing and distribution, and failure to obtain contracts with such third parties on terms acceptable to us, or at all, may significantly delay our product and service candidates market rollout. In addition, as we begin to commercialize our products, we will need to hire, develop, train personnel with expertise in marketing and selling products in each of those markets. 12 Launching a marketing campaign for our products will be costly without any assurance the products will be purchased, used and accepted. As a start up with limited capital, there may not be enough time or capital to see this product through to market acceptance. Our revenue and results of operations may vary on a quarterly and annual basis. Our revenue and results of operations could vary significantly from period-to-period and may fail to match expectations as a result of a variety of factors, some of which are outside of our control, including general market conditions and macroeconomic factors. We have not yet generated revenues and we cannot accurately estimate future revenue and operating expenses based on historical performance. Our quarterly operating results may vary significantly based on many factors, including: Fluctuating demand for our potential products; Announcements or implementation by our competitors of new products; Amount and timing of our costs related to our marketing efforts or other initiatives; Timing and amounts relating to the expansion of our operations; Our ability to enter into, renegotiate or renew key agreements; Timing and amounts relating to the expansion of our operations; or Economic conditions specific to our industry, as well as general economic conditions. As a result of the potential variations in our revenue and results of operations, period-to-period comparisons may not be meaningful and the results of any one period should not be relied on as an indication of future performance. We may also be unable to, or may elect not to, adjust spending quickly enough to offset any unexpected revenue shortfall. In addition, our results of operations may not meet the expectations of investors or public market analysts who follow the Company, which may adversely impact our stock price. We expect to make significant operating and capital expenditures in connection with the development of our plan of business. If these increased capital expenditures are not accompanied by increased revenue in the same quarter, our quarterly revenue and results of operations would be adversely affected. If we fail to effectively manage our growth, our business will be harmed. Currently, our three executive officers perform all required corporate functions, including product development activities. As we continue preparing for our service and product candidates to enter the market, we will, as availability of capital permits, begin to hire personnel necessary to support our operations. The skills we seek are typically in high demand and we may have difficulty identifying, hiring, integrating, motivating and retaining additional employees, consultants, and contract personnel. Also, our management may need to divert a disproportionate amount of our attention away from our day-to-day activities and devote a substantial amount of time to simultaneously manage rightsizing and growth activities. We may not be able to effectively manage changes in the size of our operations, which may result in weaknesses in our infrastructure, give rise to operational mistakes, loss of business opportunities, loss of employees and reduced productivity among remaining employees. Should we secure adequate capital, whether through this Offering or otherwise, we intend to hire a Marketing and Sales Officer to implement plans for product distribution and channel placement. Regional distributors will be engaged to place product into their current customers retail and physician offices. 13 Any future growth could require significant capital expenditures and may divert financial resources from other projects, such as the development of product candidates. If our management is unable to effectively manage our rightsizing efforts while scaling the Company, our expenses may increase more than expected, our ability to generate and/or grow revenues could be reduced, and we may not be able to implement our business strategy. Our future financial performance and our ability to commercialize our product candidates and compete effectively will depend, in part, on our ability to effectively manage the size of our organization. We cannot assure you that we will be able to accomplish these tasks or effectively manage our growth. We are dependent upon our executive officers for future success. Our future success to a significant extent depends on the continued services of our executive officers, Jose Antonio Reyes, Scott J. Silverman and Marvin S. Hausman, M.D. The departure of one or more of these people could materially adversely affect our ability to implement our business strategy. Currently, we do not maintain, for our benefit, any key man life insurance on any of our executive officers; we have, however, entered into employment and/or consulting agreements with Jose Antonio Reyes, Scott J. Silverman and Marvin S. Hausman, M.D. (See Management ). If we are unable to recruit and retain key personnel, our business may be harmed. If we are unable to attract and retain key personnel, our business may be harmed. Our failure to enable the effective transfer of knowledge and facilitate smooth transitions with regard to our 3 key employees could adversely affect our long-term strategic planning and execution. Our financial success is dependent to a significant degree upon the efforts of our executive officers. Our future success and viability will depend to a significant extent upon its ability to attract and retain qualified personnel in all areas of its business, especially its sales, science, and financial management teams. If we were to be unable to retain these key members of our respective teams, we would need to replace them with qualified individuals in a timely manner or our business, results of operations and financial condition could be adversely impacted. Significant disruptions of information technology systems or security breaches could adversely affect our operations. We are increasingly dependent upon information technology systems, infrastructure and data to operate our business ourselves and on vendors who operate aspects of our technology infrastructure for us. In the ordinary course of business, through the use of our product and service candidates, we will collect, store and transmit large amounts of confidential information (including, among other things, trade secrets or other intellectual property, proprietary business information and personal patient information). It is critical that we do so in a secure manner to maintain the confidentiality and integrity of such confidential information. Attacks on information technology systems are increasing in their frequency, levels of persistence, sophistication and intensity, and they are being conducted by increasingly sophisticated and organized groups that include state actors, criminal organizations and individuals who can bring significant resources and expertise to bear. 14 Our information technology systems, and those of third-party vendors with whom we contract are also vulnerable to service interruptions, security breaches from inadvertent or intentional actions by our employees, third-party vendors, and/or business partners, or from cyber-attacks by malicious third parties. Cyber-attacks could include the deployment of harmful malware, ransomware, denial-of-service attacks, social engineering and other means to affect service reliability, and could threaten the confidentiality, integrity, and availability of information. For example, interruption of our information technology systems or technology infrastructure may cause delays in producing results for patients that utilize our products and/or services. Significant disruptions of our information technology systems, or those of our third-party vendors, or security breaches could adversely affect our business operations and/or result in the loss, adulteration, misappropriation and/or unauthorized access, use or disclosure of, or the prevention of access to, confidential information, including, among other things, trade secrets or other intellectual property, proprietary business information and personal information, and could result in financial, legal, business, and reputational harm to us. Any such breach or interruption could compromise our networks, and the information stored there could be inaccessible or could be accessed by unauthorized parties, publicly disclosed, lost or stolen. Any such interruption in access, improper access, disclosure or other loss of information could result in legal claims or proceedings, liability under laws that protect the privacy of personal information, such as the federal Health Insurance Portability and Accountability Act ( HIPAA ), and regulatory penalties. Unauthorized access, loss or dissemination could also disrupt our operations, including our ability to perform tests, provide test results, bill facilities or patients, process claims and appeals, provide customer assistance services, conduct research and development activities, collect, process and prepare Company financial information, provide information about our current and future solutions and other patient and clinician education and outreach efforts through our website, and manage the administrative aspects of our business and damage our reputation, any of which could adversely affect our business. Any such breach could also result in the compromise of our trade secrets and other proprietary information, which could adversely affect our competitive position. Any failure or perceived failure by us or any third-party collaborators, service providers, contractors or consultants to comply with our privacy, confidentiality, data security or similar obligations to third parties, or any data security incidents or other security breaches that result in the unauthorized access, release or transfer of sensitive information, including personally identifiable information, may result in governmental investigations, enforcement actions, regulatory fines, litigation or public statements against us, could cause third parties to lose trust in us or could result in claims by third parties asserting that we have breached our privacy, confidentiality, data security, or similar obligations, any of which could have a material adverse effect on our reputation, business, financial condition, or results of operations. Moreover, data security incidents and other security breaches can be difficult to detect, and any delay in identifying them may lead to increased harm. While we have implemented data security measures intended to protect our information technology systems and infrastructure, there can be no assurance that such measures will successfully prevent service interruptions or data security incidents. We process, store and use certain personal information, which subjects us to privacy laws and standards, governmental regulation and other legal obligations related to privacy, and our actual or perceived failure to comply with these privacy laws and standards, regulations, and obligations could subject us to fines, sanctions or litigation, and could potentially damage our brand and reputation and adversely affect our business, financial condition and results of operations. We depend on information technology networks and systems to process, transmit and store electronic information and to communicate among our locations around the United States and with customers. We collect, use and disclose personal information, such as names, addresses, phone numbers and email addresses. We collect, store and use sensitive or confidential transaction and account information of consumers. As a result, we are or may be subject to a variety of state, national and international laws and regulations that apply to the collection, use, retention, protection, disclosure, transfer and other processing of personal data, potentially including the Fair Credit Reporting Act, the General Data Protection Regulation ( GDPR ) and California Consumer Privacy Act ( CCPA ). These laws and regulations are evolving, with new or modified laws and regulations proposed and implemented frequently and existing laws and regulations subject to new or different interpretations. For example, the GDPR introduced new data protection requirements in the EU and imposes substantial fines for breaches of the data protection rules. Compared to the previous EU data protection laws, the GDPR notably has a greater extra territorial reach and has a significant impact on data controllers and data processors, which either have an establishment in the EU, or offer goods or services to EU data subjects or monitor EU data subjects behavior within the EU. The GDPR regime imposes more stringent operational requirements on both data controllers and data processors, and introduces significant penalties for non-compliance with fines of up to 4% of total annual worldwide turnover or 20.0 million (whichever is higher), depending on the type and severity of the breach. 15 In addition, the CCPA expands the rights of California residents to access and require deletion of their personal information, opt out of certain personal information sharing and receive detailed information about how their personal information is used. The CCPA imposes a number of privacy and security obligations on companies who collect, use, disclose, or otherwise process personal information of California residents, which may result in civil penalties for violations and private rights of action in case of data breaches. The CCPA provides for civil penalties for violations, which could result in statutory penalties of up to $2,500 per violation, or up to $7,500 per violation if the violation is intentional. Other states have adopted, or are considering enacting, similar laws. Any failure or alleged failure to comply with privacy or data protection laws could lead to government enforcement actions and significant penalties against us, and could materially and adversely affect our reputation, business, financial condition, cash flows and results of operations. Compliance with any of the foregoing laws and regulations can be costly, can delay or impede the development of new products, and may require us to change the way we operate. Additionally, the California Privacy Rights Act ( CPRA ), which took effect on January 1, 2023 and significantly expands the CCPA, imposes additional data protection obligations on companies doing business in California, including additional consumer rights processes and opt outs for certain uses of sensitive data and sharing of personal data as well as an expanded definition of sale to include sharing of personal information, and data minimization and data retention requirements. The CPRA also establishes a new enforcement agency, the California Privacy Protection Agency, which may take a more active role in enforcement. Other states have and are likely to continue to implement their own privacy statutes in the near term. The effects of the CCPA, CPRA and other similar state regulations are potentially significant and may require us to modify our data collection or processing practices and policies and to incur substantial costs and expenses in an effort to comply and increase our potential exposure to regulatory enforcement and/or litigation. Any of the foregoing could materially and adversely affect our business, results of operations and financial condition. We may also be subject to or affected by evolving federal, state and foreign data protection laws and regulations, such as laws and regulations that address privacy and data security. In the United States, federal, state, and local governments have enacted numerous data privacy and security laws, including data breach notification laws, personal data privacy laws, and consumer protection laws (e.g. Section 5 of the Federal Trade Commission Act). For example, HIPAA as amended by the Health Information Technology for Economic and Clinical Health Act, imposes specific requirements relating to the privacy, security, and transmission of individually identifiable health information. We may obtain health information or other personal information from third parties, including research institutions from which we obtain clinical trial data, that are subject to privacy and security requirements under HIPAA. While we do not believe that we are currently acting as a covered entity or business associate under HIPAA and thus are not directly regulated under HIPAA, any person may be prosecuted under HIPAA s criminal provisions if it knowingly receives individually identifiable health information from a HIPAA-covered healthcare provider or research institution that has not satisfied HIPAA requirements for disclosure of individually identifiable health information under aiding-and-abetting or conspiracy principles. The interpretation and application of many privacy and data protection laws are uncertain. Anticipated further evolution of regulations on this topic may substantially increase the penalties to which we could be subject to in the event of any non-compliance. These laws may be interpreted and applied in a manner that is inconsistent with our existing data management practices or the features of our products. If so, in addition to the possibility of negative publicity, fines, lawsuits and other claims and penalties, we could be required to fundamentally change our business activities and practices or modify our products, which could harm our business. 16 We seek to comply with privacy related industry standards and are subject to the terms of our own privacy policies and privacy related obligations to third parties. We strive to comply with all applicable laws, policies, legal obligations and industry codes of conduct relating to privacy and data security protection to the extent possible. However, these obligations may be interpreted and applied in a manner that is inconsistent from one jurisdiction to another and may conflict with other rules or regulations, making enforcement, and thus compliance requirements, ambiguous, uncertain, and potentially inconsistent. Additionally, laws, regulations, and standards covering marketing and advertising activities conducted by telephone, email, mobile devices, and the internet may be applicable to our business, such as the Telephone Consumer Protection Act (as implemented by the Telemarketing Sales Rule), the CAN SPAM Act of 2003, and similar state consumer protection laws. Any failure or perceived failure by us to comply with our privacy policies, privacy related obligations to agents, clients or other third parties, or our privacy related legal obligations, any marketing or advertising related laws, regulations, or standards, or any compromise of security that results in the unauthorized access to or unintended release of personal information or other agent or client data, may result in governmental enforcement actions, litigation, or public statements against us by consumer advocacy groups or others. Any of these events could cause us to incur significant costs in investigating and defending such claims and, if found liable, pay significant damages. Further, these proceedings and any subsequent adverse outcomes may cause our agents and clients to lose trust in us, which could have a material adverse effect on our reputation and business. We are also subject to laws and regulations that involve electronic contracts and other communications; consumer protection; and online payment services. These laws and regulations are constantly evolving and can be subject to significant change. For example, many states have ordinances in place allowing individuals with certain criminal backgrounds to become tenants. State ordinances vary from state to state, and the types of criminal backgrounds that will clear a background check are not uniform on a national scale. As a result, the application, interpretation, and enforcement of these laws and regulations are often uncertain and may be interpreted and applied inconsistently. Additionally, as we depend on third parties for key services, we rely on such third-party service providers compliance with laws and regulations regarding privacy, data protection, consumer protection, and other matters relating to our customers. Any significant change to applicable laws, regulations or industry practices regarding the use or disclosure of personal information, or regarding the manner in which the express or implied consent of agents and their clients for the use and disclosure of personal information is obtained, could require us to modify our platform and its features, possibly in a material manner and subject us to increased compliance costs, which may limit our ability to innovate, improve and expand our platform and its features that make use of the personal information that our agents and their clients voluntarily share. Our customers operate independent of our platform as well and are responsible for their own data privacy compliance in certain respects. Additionally, we provide training and our platform provides tools and security controls to assist our agents with their data privacy compliance to the extent they store relevant data on our platform. However, if a customer or tenant on our platform were to be subject to a claim for breach of data privacy laws, we could possibly be found liable for their claims due to our relationship, which can require us to take more costly data security and compliance measures or to develop more complex systems. Our business plan is not based on independent market studies. We have not commissioned any independent market studies concerning our plans of operations. Rather, our plans for implementing our business strategy and achieving profitability are based on the experience, judgment and assumptions of our management. If these assumptions prove to be incorrect, we may not be successful in our business operations. 17 Our Board of Directors may change our policies without stockholder approval. Our policies, including any policies with respect to investments, leverage, financing, growth, debt and capitalization, will be determined by our Board of Directors or officers to whom our Board of Directors delegate such authority. Our Board of Directors will also establish the amount of any dividends or other distributions that we may pay to our stockholders. Our Board of Directors or officers to which such decisions are delegated will have the ability to amend or revise these and our other policies at any time without stockholder vote. Accordingly, our stockholders will not be entitled to approve changes in our policies, which policy changes may have a material adverse effect on our financial condition and results of operations. There are limitations of director liability and indemnification of directors, officers and employees. Pursuant to Section 78.7502 of the Nevada Revised Statutes, we have the power to indemnify any person made a party to any lawsuit by reason of being a director or officer of the Company, or serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. Our Articles of Incorporation provide that the Company shall indemnify its directors and officers to the fullest extent permitted by Nevada law. These limitations of liability do not apply to liabilities arising under the federal or state securities laws and do not affect the availability of equitable remedies such as injunctive relief or rescission. Our corporate bylaws provide that we will indemnify our directors, officers and employees to the fullest extent permitted by law. Our bylaws also provide that we are obligated to advance expenses incurred by a director or officer in advance of the final disposition of any action or proceeding. We believe that these bylaw provisions are necessary to attract and retain qualified persons as directors and officers. The limitation of liability in our Articles of Incorporation and bylaws may discourage stockholders from bringing a lawsuit against directors for breach of their fiduciary duties. They may also reduce the likelihood of derivative litigation against directors and officers, even though an action, if successful, might provide a benefit to us and our stockholders. Our results of operations and financial condition may be harmed to the extent we pay the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions. We are an emerging growth company and a smaller reporting company and intend to take advantage of reduced disclosure requirements applicable to emerging growth companies, which could make the Common Stock less attractive to investors. We are an emerging growth company ( EGC ) as defined in the Jumpstart Our Business Startups Act of 2012. we will remain an EGC until the earliest to occur of (i) the last day of the fiscal year in which it has total annual gross revenue of $1.235 billion or more; (ii) the last day of the fiscal year following the fifth anniversary of the date of the first sale of Common Stock pursuant to the registration statement; (iii) the date on which it has issued more than $1.0 billion in non-convertible debt securities during the prior three-year period; or (iv) the date it qualifies as a large accelerated filer under the rules of the SEC, which means the market value of the Common Stock held by non-affiliates exceeds $700 million as of the last business day of its most recently completed second fiscal quarter after it has been a reporting Company in the United States for at least 12 months. For so long as we remain an EGC, we are permitted to and intend to rely upon exemptions from certain disclosure requirements that are applicable to other public companies that are not EGCs. These exemptions include not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act and reduced disclosure about our executive compensation arrangements. 18 We may choose to take advantage of some but not all of these reduced burdens. We have taken advantage of reduced reporting requirements in this prospectus. Accordingly, the information contained herein may be different from the information you receive from other public companies in which you hold stock. In addition, Section 107 of the Jumpstart Our Business Startups Act (the JOBS Act ) provides that an EGC may take advantage of an extended transition period for complying with new or revised accounting standards, delaying the adoption of these accounting standards until they would apply to private companies. We have elected to avail ourselves of the extended transition period for complying with new or revised financial accounting standards. As a result of our accounting standards election, we will not be subject to the same implementation timing for new or revised accounting standards as other public companies that are not EGC s which may make comparison of our financials to those of other public companies more difficult. We are also a smaller reporting company, as defined in Rule 405 promulgated under the Securities Act of 1933 (the Securities Act ). As an SRC, the Company intends to utilize certain reduced disclosure requirements, including publishing two years of audited financial statements instead of three years, as required for companies that do not qualify as an SRC. The Company will remain an SRC until the last day of the fiscal year in which it had (i) a public float that exceeded $250 million or (ii) annual revenues of more than $100 million and a public float that exceeded $700 million. To the extent the Company takes advantage of such reduced disclosure obligations, it may make comparison of its financial statements to those of other public companies difficult or impossible. After the Company ceases to be an SRC, it is expected to incur additional management time and cost to comply with the more stringent reporting requirements applicable to companies that are accelerated filers or large accelerated filers, including complying with the auditor attestation requirements of Section 404 of SOX. Risks Related to Our Business We use RNA-based molecular biology in our products and services pipeline and the successful commercialization of these products will depend on public perceptions of RNA-based products. The successful commercialization of our product candidates depends, in part, on public acceptance of modern biotechnology techniques and the use of RNA genetic biomarkers to identify differentially expressed genes ( DEGs ) involved in the inflammatory process associated with the development of chronic diseases, such as heart disease and cancer. Negative public perceptions about RNA and molecular regulation of gene expression can also affect the regulatory environment in the jurisdictions in which we are targeting the sale of our products and the commercialization of our product candidates. Any increase in such negative perceptions or any restrictive government regulations in response to RNA-based products could have a negative effect on our business and may delay or impair the sale of our products or the development or commercialization of our product candidates. Public pressure may lead to increased regulation and legislation for products produced using genetic biotechnology and this could adversely affect our ability to sell our product or commercialize our product candidates. If the U. S. Food and Drug Administration (the FDA ) were to begin actively regulating our tests, we could incur substantial costs and delays associated with trying to obtain premarket clearance or approval and incur costs associated with complying with post-market controls. We intend to launch and market each of our proprietary testing products as a laboratory-developed test ( LDT ). We believe each of our proprietary testing products that we will offer are LDTs. The FDA generally considers an LDT to be a test that is developed, validated and performed within a single laboratory. The FDA sometimes determines that a test that is being offered by a laboratory as an LDT is not an LDT under the FDA s interpretation of that term but is an in vitro diagnostic ( IVD ) medical device in commercial distribution, and therefore must comply with the regulations that apply to IVDs, including the need for successfully completing the FDA review process. If the FDA were to conclude that our proprietary testing product is not an LDT, we would be subject to extensive regulation as a medical device. Moreover, even for tests that are deemed to be LDTs, the FDA has historically taken the position that it has the authority to regulate such tests as IVDs under the Federal Food, Drug, and Cosmetic Act, or FDC Act, although it has generally exercised enforcement discretion with regard to LDTs. This means that even though the FDA believes it can impose regulatory requirements on LDTs, such as requirements to obtain premarket approval, de novo authorization or clearance of LDTs, it has generally chosen not to enforce those requirements. The regulatory environment for LDTs has changed over time. For example, in 2020, the Department of Health and Human Services, or HHS, directed the FDA to stop regulating LDTs, but in 2021, HHS reversed its policy. Thereafter, the FDA resumed requiring submission of emergency use authorization, or EUA, requests, for COVID-19 LDTs, but has not indicated an intent to change its policy of enforcement discretion with respect to other, non-COVID, LDTs. Various bills have been introduced in Congress seeking to substantially revamp the regulation of both LDTs and IVDs. For example, the VALID Act, introduced in June 2021, would clarify and enhance the FDA s authority to regulate LDTs, while the VITAL Act, introduced in May 2021, would assign oversight of LDTs exclusively to the Centers for Medicare and Medicaid Services, or CMS. 19 Neither the VALID Act nor the VITAL Act has been enacted into law as of the date of this prospectus. Although the VALID Act was favorably voted upon in June 2022 by the Senate Health, Education, Labor and Pensions Committee as part of the FDA Safety and Landmark Advancements bill, it was not included in the version of that legislation that was enacted by Congress and signed into law. Congress may, through the enactment of other legislation during the current session of Congress or the subsequent Congress, enact VALID or establish new regulatory requirements for LDTs through other legislation. In the meantime, the regulation by the FDA of LDTs remains uncertain. The FDA may, if Congress does not enact new legislation, seek to establish new requirements for LDTs. If FDA premarket clearance, approval or authorization is required by the FDA for any of our future proprietary testing products, or for any components or materials we use in our tests, such as the component used to collect samples from patients, we may be forced to stop selling our tests or we may be required to modify claims for or make other changes to our tests while we work to obtain FDA clearance, approval or de novo authorization. Our business would be adversely affected while such review is ongoing and if we are ultimately unable to obtain premarket clearance, approval or de novo authorization. For example, the regulatory premarket clearance, approval or de novo authorization process may involve, among other things, successfully completing analytical, pre-clinical and/or clinical studies beyond the studies we have already performed or plan to perform for our LDT. These studies may be extensive and costly and may take a substantial period of time to complete. Any such studies may fail to generate data that meets the FDA s requirements. The studies may also not be conducted in a manner that meets the FDA s requirements, and therefore could not be used in support of the marketing application. We would also need to submit a premarket notification, or 510(k), a request for de novo authorization, or a PMA application to the FDA and to include information (e.g., clinical and other data) supporting our LDT. Completing such studies requires the expenditure of time, attention and financial and other resources, and may not yield the desired results, which may delay, limit or prevent regulatory clearances, approvals or de novo authorizations. There can be no assurance that the submission of such an application will result in a timely response by the FDA or a favorable outcome that will allow the test to be marketed. Certain types of standalone diagnostics software are subject to FDA regulation as a medical device (specifically, software as a medical device or SaMD ). Some types of SaMD are subject to premarket authorization requirements. If the FDA were to conclude that the proprietary mRNA technology we have developed to predict the presence of inflammatory-driven diseases and monitor patient treatment responses through artificial intelligence is required to obtain premarket authorization for the software used to analyze the mRNA genetic score, our ability to offer the test as an LDT could be delayed or prevented, which would adversely affect our business. In addition, we may require cooperation in our filings for FDA clearance, approval or de novo authorization from third-party manufacturers of the components of our tests. We cannot assure investors that any of our tests for which we decide to pursue or are required to obtain premarket clearance, approval or de novo authorization by the FDA will be cleared, approved or authorized on a timely basis, if at all. In addition, if a test has been cleared, approved or authorized, certain kinds of changes that we may make, e.g., to improve the test, or because of issues with suppliers of the components of the test or modification by a supplier to a component upon which our test approval relies, may result in the need for the test to obtain new clearance, approval or authorization from the FDA before we can implement them, which could increase the time and expense involved in implementing such changes commercially. Ongoing compliance with FDA regulations, such as the Quality System Regulation, labeling requirements, Medical Device Reports, and recall reporting, would increase the cost of conducting our business and subject us to heightened regulation by the FDA. We will be subject to periodic inspection by the FDA to ascertain whether our facility does comply with applicable requirements. The penalties for failure to comply with these and other requirements may include Warning Letters, product seizure, injunctions, civil penalties, criminal penalties, mandatory customer notification, and recalls, any of which may adversely impact our business and results of operations. 20 Furthermore, the FDA or the Federal Trade Commission ( FTC ), as well as state consumer protection agencies and competitors, may object to the materials and methods we use to promote the use of our current tests or other LDTs we may develop in the future, including with respect to the product claims in our promotional materials, and may initiate enforcement actions against us. Enforcement actions by these agencies may include, among others, injunctions, civil penalties, and equitable monetary relief. For more information, see Business Laboratory Developed Test (LDT) below. We are in competition with companies that are larger, more established and better capitalized than we are. The medical testing products industry is highly competitive, rapidly evolving and subject to constant change. The number of competitors in our industry is substantial. We expect that if our products establish a market niche, competition will arise from a variety of sources, including from large healthcare companies to other smaller national and regional healthcare companies. Many of our potential competitors possess: greater financial, technical, personnel, promotional and marketing resources; longer operating histories; greater name recognition; and larger consumer bases. We cannot assure you that we will be able to compete effectively in our extremely competitive industry. Our mRNA product candidates are based on innovative technologies and any product candidates we develop may be more complex and more difficult to manufacture than initially anticipated. We may encounter difficulties with manufacturing processes, manufacturing at higher volumes, product releases, product shelf life and storage, supply chain management, or shipping for any of our products. If we or any of our third-party vendors encounter such difficulties, our ability to supply commercial products or material for clinical studies could be delayed or stopped. We have applied medical artificial intelligence ( AI ) technology that uses RNA-based inflammatory genetic biomarkers to assist in disease diagnosis, monitoring and assessment of patient responses to certain treatment modalities. The manufacturing processes for our mRNA genomic technology are innovative and complex. To the best of our knowledge, there are no competitive mRNA products currently manufactured at commercial scale. Due to the complexities of this technology and our limited experience at commercial scale production, we could encounter difficulties with manufacturing processes, manufacturing at higher volumes, product releases, product shelf life and storage issues, supply chain management, or shipping. There may also be a high degree of technological change that can negatively impact our product comparability during and after clinical development. Furthermore, technology changes may drive the need for changes in, modification to, or the sourcing of new manufacturing infrastructure or may adversely affect third-party relationships. The process to generate mRNA product candidates is complex and, if not developed and manufactured under well-controlled conditions, can adversely impact pharmacological outcomes and may result in one or more of our product candidates failures. To date, we have not completed the development of our product candidates and there is no assurance that, once developed, any of our products will be accepted by our targeted customers. If we do not successfully develop and commercialize our products based upon this technological approach, we may not become profitable, and our results of operations may be adversely affected. 21 The materials used in our diagnostic tests processes and those used to manufacture RNA-based products and our derivative products, such as mRNA genetic microarrays, may become difficult to obtain in the quality or quantity required for our business plans or at the prices that are currently projected. Many of our processes and products rely on materials purchased from third parties and should these materials increase in prices, have supply constraints, or become unavailable, it could impact our ability to develop products or bring them to market either on time, at competitive prices or at all. For example, some of our protein diagnostic tests that we use to identify inflammatory related diseases, such as ELISA (as defined below) and Apoptotic Index technology, may use compounds that are sourced from suppliers in China. Further, mRNA panels used in our diagnostic tests are produced by a third-party. As such, should these particular components become unavailable, the effectiveness, yield or availability of some of our available laboratory tests could be impaired. We rely on highly specialized equipment and consumables for the production of our derivative products, and any disruption to the supply chain or any malfunction of that equipment may adversely impact our operations. The equipment and consumables used in our tests are currently supply constrained, which may cause delays in development, testing or marketing of our human health products and may require us to ultimately increase prices should our products become available to consumers. Additionally, we will be dependent on equipment providers and third-party contract manufacturing organizations ( CMOs ) who are also implementing innovative technology. For instance, we will use medical AI technology that uses mRNA-based genetic biomarkers to assess the presence of chronic inflammatory driven diseases and monitor patient treatment responses. This AI technology is run on a third-party equipment. If such equipment malfunctions or if we encounter unexpected performance issues, we could encounter delays or interruptions to clinical and commercial supply. Delivery delays or unavailability of products, services, or equipment provided by suppliers could require us to change the design of our research, development, and manufacturing processes based on the functions, limitations, features, and specifications of the replacement items or seek out a new supplier to provide these items. Additionally, as we grow, our existing suppliers may not be able to meet our increasing demand, and additional suppliers may need to be found. We may not be able to secure suppliers who provide lab supplies at, or equipment and services to, the specification, quantity, and quality levels that we demand (or at all) or be able to negotiate acceptable fees and terms of services with such suppliers. If we are unable to develop and later market our products under development in a timely manner or at all, or if competitors develop or introduce similar products that achieve commercialization before our products enter the market, the demand for our products may decrease or the products could become obsolete. Our products will compete in competitive markets, where competitors may already be well established. We expect that competitors will continue to innovate, develop, and introduce similar products that could be competitive in both price and performance. Competitors may succeed in developing or introducing similar products earlier than us, obtain regulatory approvals and clearances before our products are approved and cleared, or develop more effective products. In addition, competitors may have products which may achieve commercialization before our products enter the market. Our marketing strategies for our products may not be successful. We will be required to attract customers to our products, all of which will be new upon their introduction. Should our marketing strategies fail to establish sales of our products, our operations will be adversely affected. Additionally, the use of home testing kits to assess chronic inflammatory related disease conditions may not be perceived as needed in the market, especially if the testing kit is not paid for by insurance. Relying on customers to pay out of pocket for these kits is potentially a very large impediment to product use and acceptance. We do not currently plan to seek insurance coverage for use of the home testing kits. 22 Our business may be affected by litigation and government investigations. We may from time to time receive inquiries and subpoenas and other types of information requests from government authorities and others and we may become subject to claims and other actions related to our business activities. While the ultimate outcome of investigations, inquiries, information requests and legal proceedings is difficult to predict, defense of litigation claims can be expensive, time-consuming, and distracting, and adverse resolutions or settlements of those matters may result in, among other things, modification of our business practices, costs and significant payments, any of which could have a material adverse effect on our business, financial condition, results of operations and prospects. Our intellectual property rights are valuable, and any inability to protect them could reduce the value of our products and brand. We have invested, and will continue to invest resources to protect our brands and intellectual property rights. However, we may be unable or unwilling to strictly enforce our intellectual property rights, including our patents and trademarks, from infringement. Our failure to enforce our intellectual property rights could diminish the value of our brands and product offerings and harm our business and future growth prospects. If we are unable to obtain and maintain patent protection for our technology and products, or if any licensors are unable to obtain and maintain patent protection for the technology or products that we may license from them in the future, or if the scope of the patent protection obtained is not sufficiently broad, our competitors could develop and commercialize technology and products similar or identical to ours, and our ability to successfully commercialize our technology and products may be adversely affected. As of September 16, 2025, we have 3 patent applications filed, or under examination in key global jurisdictions relating to our products. Our future success depends in large part on our and, as applicable, our licensors , ability to obtain and maintain patent protection in the United States and other countries with respect to our proprietary technology. We cannot be certain that patents will be issued in those countries where our applications are still under examination. The patent process is expensive and time-consuming, and we may not be able to file and prosecute all necessary or desirable patent applications at a reasonable cost or in a timely manner. It is also possible that we will fail to identify patentable aspects of our R&D output before it is too late to obtain patent protection. The patent position of biotechnology and pharmaceutical companies is generally highly uncertain, involves complex legal and factual questions and has in recent years been the subject of much litigation. As a result, the issuance, scope, validity, enforceability and commercial value of our patent rights are uncertain. Our pending and future patent applications may not result in patents being issued which protect our technology or products or which effectively prevent others from commercializing competitive technologies and products. Changes in either the patent laws or interpretation of the patent laws in the United States and other countries may diminish the value of our patents or narrow the scope of our patent protection. 23 The laws of foreign countries may not protect our rights to the same extent as the laws of the United States. Publications of discoveries in the scientific literature often lag behind the actual discoveries, and patent applications in the United States and other jurisdictions are typically not published until 18 months after filing. Therefore, we cannot be certain that we or our licensors were the first to make the inventions claimed in our owned or licensed patents or pending patent applications, or that we or our licensors were the first to file for patent protection of such inventions. Assuming the other requirements for patentability are met, in the United States, for patents that have an effective filing date prior to March 15, 2013, the first to make the claimed invention is entitled to the patent, while outside the United States, the first to file a patent application is entitled to the patent. In March 2013, the United States transitioned to a first inventor to file system in which, assuming the other requirements for patentability are met, the first inventor to file a patent application will be entitled to the patent. We may be subject to a third-party pre-issuance submission of prior art to the U.S. Patent and Trademark Office, or become involved in opposition, derivation, reexamination, inter parties review or interference proceedings challenging our patent rights or the patent rights of others. An adverse determination in any such submission, proceeding or litigation could reduce the scope of, or invalidate, our patent rights, allow third parties to commercialize our technology or products and compete directly with us, without payment to us, or result in our inability to manufacture or commercialize products without infringing third-party patent rights. Even if our owned and licensed patent applications are issued as patents, they may not be issued in a form that will provide us with any meaningful protection, prevent competitors from competing with us or otherwise provide us with any competitive advantage. Our competitors may be able to circumvent our owned or licensed patents by developing similar or alternative technologies or products in a non-infringing manner. The issuance of a patent is not conclusive as to its inventorship, scope, validity or enforceability, and our owned and licensed patents may be challenged in the courts or patent offices in the United States and abroad. Such challenges may result in loss of exclusivity or freedom to operate or in patent claims being narrowed, invalidated or held unenforceable, which could limit our ability to stop others from using or commercializing similar or identical technology and products, or limit the duration of the patent protection of our technology and products. Given the amount of time required for the development, testing and regulatory review of new product candidates, patents protecting such candidates might expire before or shortly after such candidates are commercialized. As a result, our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products similar or identical to ours. We may become involved in lawsuits to protect or enforce our patents, which could be expensive, time-consuming and unsuccessful. Competitors may infringe on our patents. To counter infringement or unauthorized use, we may be required to file infringement claims, which can be expensive and time consuming. In addition, in an infringement proceeding, a court may decide that a patent of ours is invalid or unenforceable or may refuse to stop the other party from using the technology at issue on the grounds that our patents do not cover the technology in question. An adverse result in any litigation proceeding could put one or more of our patents at risk of being invalidated or interpreted narrowly. Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation. In addition, our licensors may have rights to file and prosecute such claims and we are reliant on them. 24 Third parties may initiate legal proceedings alleging that we are infringing their intellectual property rights, the outcome of which would be uncertain and could have a material adverse effect on the success of our business. Our commercial success depends upon our ability and the ability of our collaborators to develop, manufacture, market and sell our products and product candidates and use our proprietary technologies without infringing the proprietary rights of third parties. We have yet to conduct comprehensive freedom-to-operate searches to determine whether our use of certain of the patent rights owned by or licensed to us would infringe patents issued to third parties. We may become party to, or threatened with, future adversarial proceedings or litigation regarding intellectual property rights with respect to our products and technology, including interference proceedings before the U.S. Patent and Trademark Office and their European Union and global equivalents. Third parties may assert infringement claims against us based on existing patents or patents that may be granted in the future. If we are found to infringe a third party s intellectual property rights, we could be required to obtain a license from such third party to continue developing and marketing our products and technology. However, we may not be able to obtain any required license on commercially reasonable terms or at all. Even if we were able to obtain a license, it could be non-exclusive, thereby giving our competitors access to the same technologies licensed to us. We could be forced, including by court order, to cease commercializing the infringing technology or product. In addition, we could be found liable for monetary damages. A finding of infringement could prevent us from commercializing our product candidates or force us to cease some of our business operations, which could materially harm our business. Claims that we have misappropriated the confidential information or trade secrets of third parties could have a similar negative impact on our business. Intellectual property litigation could cause us to spend substantial resources and distract our personnel from their normal responsibilities. Even if resolved in our favor, litigation or other legal proceedings relating to intellectual property claims may cause us to incur significant expenses and could distract our personnel from their normal responsibilities. In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments and if securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the price of our Common Stock. Such litigation or proceedings could substantially increase our operating losses and reduce the resources available for development activities or any future sales, marketing or distribution activities. We may not have sufficient financial or other resources to adequately conduct such litigation or proceedings. Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their greater financial resources. Uncertainties resulting from the initiation and continuation of patent litigation or other proceedings could have a material adverse effect on our ability to compete in the marketplace. If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be harmed. In addition to seeking patents for some of our technology and products, we also rely on trade secrets, including unpatented know-how, technology and other proprietary information, to maintain our competitive position. We seek to protect these trade secrets, in part, by entering into non-disclosure and confidentiality agreements with parties who have access to them, such as our employees, corporate collaborators, outside scientific collaborators, CMOs, consultants, advisors and other third parties. We also enter into confidentiality and invention or patent assignment agreements with our employees and consultants. Despite these efforts, any of these parties may breach the agreements and disclose our proprietary information, including our trade secrets, and we may not be able to obtain adequate remedies for such breaches. Enforcing a claim that a party illegally disclosed or misappropriated a trade secret is difficult, expensive and time-consuming, and the outcome is unpredictable. In addition, some courts inside and outside the United States are less willing or unwilling to protect trade secrets. If any of our trade secrets were to be lawfully obtained or independently developed by a competitor, we would have no right to prevent them from using that technology or information to compete with us. If any of our trade secrets were to be disclosed to or independently developed by a competitor, our competitive position would be harmed. 25 If we are unable to obtain and maintain protection of our intellectual property, which are costly to maintain, the value of our products may be adversely affected. Our industry is characterized by vigorous pursuit and protection of intellectual property rights, which has resulted in protracted and expensive litigation for several companies. Third parties may assert claims of misappropriation of trade secrets or infringement of intellectual property rights against us or against our end customers or partners for which we may be liable. As our business expands, the number of products and competitors in our markets can be expected to increase and product overlaps to occur, and infringement claims may increase in number and significance. Intellectual property lawsuits are subject to inherent uncertainties due to the complexity of the technical issues involved, and we cannot be certain that we would be successful in defending ourselves against intellectual property claims. Further, many potential litigants have the capability to dedicate substantially greater resources than we can to enforce their intellectual property rights and to defend claims that may be brought against them. Furthermore, a successful claimant could secure a judgment that requires us to pay substantial damages or prevents us from distributing products or performing certain services. We attempt to protect our intellectual property position, in part, by filing patent applications related to our proprietary technology, inventions and improvements that are important to our business. However, our patent and trademark positions are not likely by itself to prevent others from commercializing products that compete directly with our products. In addition, the patents and trademarks owned by us or issued to us could be challenged, invalidated, or held to be unenforceable. We also note that any patent granted may not provide a competitive advantage to us. Our competitors may independently develop technologies that are substantially similar or superior to our technologies. Further, third parties may design around our patented or proprietary products and technologies. We rely on certain trade secrets and we may not be able to adequately protect our trade secrets even with contracts with our personnel and third parties. Also, any third party could independently develop and have the right to use, our trade secret, know-how and other proprietary information. If we are unable to protect our intellectual property rights, our business, prospects, financial condition and results of operations could suffer materially. We may not be successful in registering and enforcing our trademarks. As we apply to register our unregistered trademarks in the United States and other countries, our applications may not be allowed for registration in a timely fashion or at all, and our registered trademarks may not be maintained or enforced. Trademark enforcement is always uncertain, since proving infringement requires a showing of consumer confusion in addition to use by the defendant of a similar or identical trademark. In addition, opposition or cancellation proceedings may be filed against our trademark applications and registrations, and our trademarks may not survive such proceedings. In certain countries outside of the United States, trademark registration is required to enforce trademark rights. If we do not secure registrations for our trademarks, we may encounter more difficulty in enforcing them against third parties than we otherwise would. Risks Related to an Investment in Our Securities Persons who purchase shares of our Common Stock may lose their money without us ever being able to develop an active market. In the event that no active market to purchase our Common Stock is ever created, it is likely that the entire investment of a purchaser in our Common Stock would be lost. 26 We are authorized to issue Convertible Preferred Stock without stockholder approval, which could adversely impact the rights of holders of our securities. Our articles of incorporation authorize us to issue up to 7,000,000 shares of Convertible Preferred Stock. Any Convertible Preferred Stock that we issue in the future may rank ahead of our securities in terms of dividend priority or liquidation premiums and may have greater voting rights than our securities. In addition, such Convertible Preferred Stock may contain provisions allowing those shares to be converted into shares of Common Stock, which could dilute the value of our Common Stock to current stockholders and could adversely affect the market price, if any, of our Common Stock. In addition, the Convertible Preferred Stock could be utilized, under certain circumstances, as a method of discouraging, delaying or preventing a change in control of our Company. Although we have no present intention to issue any shares of authorized convertible preferred stock after the conversion of all of the outstanding shares, there can be no assurance that we will not do so in the future. Investors in this Offering will experience immediate and substantial dilution in net tangible book value. If you purchase Common Stock in this Offering, your investment will be diluted to the extent of the difference between your purchase price per Offered Share and the net tangible book value of our Common Stock after this Offering. Our net tangible book value as of June 30, 2025, was $(3,402,780), or $(0.02) per share. As a result of the issuances in this Offering, investors in this Offering will incur immediate dilution of $ per share based on the assumed offering price of $ per share. Investors in this Offering will pay a price per share that substantially exceeds the book value of our assets after subtracting our liabilities. See Dilution for a more complete description of how the value of your investment will be diluted upon the completion of this Offering. We have outstanding indebtedness pursuant to the Convertible Notes, and default on such Convertible Notes may adversely affect our financial condition and ability to operate our business. If the holders of the Convertible Notes determine not to convert the Convertible Notes into shares of our Common Stock, we may be unable to discharge such obligations when due. In such circumstance, we would be in default on each of the Convertible Notes, which would have a severe material adverse effect on our ability to operate our business. None of the Convertible Notes is due until, at the earliest, December 31, 2025. In addition, we may need additional financing to support our business and pursue our growth strategy, including for pursuing our future planned studies. Our ability to obtain additional financing, if and when required, will depend on investor demand, our operating performance, the condition of the capital markets and other factors. We cannot assure you that additional financing will be available to us on favorable terms when required, or at all. If we raise additional funds through the issuance of equity, equity-linked or debt securities, those securities may have rights, preferences or privileges senior to those of our Common Stock, and, in the case of equity and equity-linked securities, our existing shareholder may experience dilution. We may seek capital that may result in stockholder dilution or that may have rights senior to those of our Common Stock. From time to time, we may seek to obtain additional capital, either through equity, equity linked or debt securities. The decision to obtain additional capital will depend on, among other factors, our business plans, operating performance and condition of the capital markets. If we raise additional funds through the issuance of equity, equity linked or debt securities, those securities may have rights, preferences or privileges senior to the rights of our Common Stock, which could negatively affect the market price of our Common Stock or cause our stockholders to experience dilution. Given that we do not have committed sources of financing, we may attempt to raise capital by selling shares, possibly at a deep discount to market. These actions may result in dilution of the ownership interests and voting power of existing stockholders, further dilute Common Stock book value, and may delay, defer or prevent a change of control. 27 Future issuances of debt securities and equity securities could negatively affect the market price of shares of our Common Stock and, in the case of equity securities, may be dilutive to existing stockholders. In the future, we may issue debt or equity securities or incur other financial obligations, including stock dividends. Upon liquidation, it is possible that holders of our debt securities and other loans and preferred stock would receive a distribution of our available assets before Common Stockholders. We are not required to offer any such additional debt or equity securities to existing stockholders on a preemptive basis. Therefore, additional Common Stock issuances, directly or through convertible or exchangeable securities, warrants or options, would dilute the holdings of our existing Common Stockholders and such issuances, or the perception of such issuances, could reduce the market price of shares of our Common Stock. We do not intend to pay dividends on our Common Stock. We intend to retain earnings, if any, to provide funds for the implementation of our business strategy. We do not intend to declare or pay any dividends in the foreseeable future. Therefore, there can be no assurance that holders of our Common Stock will receive cash, stock or other dividends on their shares of our Common Stock, until we have funds which our Board of Directors determines can be allocated to dividends. Further, our Common Stock may be less valuable because a return on your investment will only occur if our stock price appreciates. We have broad discretion in the use of the net proceeds from this Offering and may not use them effectively. Our management will have broad discretion in the application of the net proceeds from this Offering, including for any of the purposes described in the section entitled Use of Proceeds, and you will not have the opportunity as part of your investment decision to assess whether the net proceeds will be used appropriately. Because of the number and variability of factors that will determine our use of the net proceeds from this Offering, their ultimate use may vary substantially from their currently intended use. Furthermore, our management will have broad discretion in the application of the net proceeds, and investors will be relying on our judgment regarding the application of the net proceeds of this Offering. The failure by our management to apply these funds effectively could harm our business. Pending their use, we may invest the net proceeds from this Offering in short-term, investment-grade, interest-bearing securities. These investments may not yield a favorable return to our stockholders. If we do not invest or apply the net proceeds from this Offering in ways that enhance stockholder value, we may fail to achieve expected financial results, which could cause our stock price to decline. Because our Common Stock is considered a penny stock, any investment in our Common Stock is considered to be a high risk investment and is subject to restrictions on marketability. Our Common Stock is considered a penny stock because it is quoted on the OTCID and it trades for less than $5.00 per share. The OTCID is generally regarded as a less efficient trading market than the Nasdaq Capital or Global Markets or the New York Stock Exchange. The SEC has rules that regulate broker dealer practices in connection with transactions in penny stocks. Penny stocks generally are equity securities with a price of less than $5.00 per share (other than securities registered on certain national securities exchanges, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). The penny stock rules require a broker dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document prepared by the SEC, which specifies information about penny stocks and the nature and significance of risks of the penny stock market. The broker dealer also must provide the customer with bid and offer quotations for the penny stock, the compensation of the broker dealer and any salesperson in the transaction, and monthly account statements indicating the market value of each penny stock held in the customer s account. In addition, the penny stock rules require that, prior to effecting a transaction in a penny stock not otherwise exempt from those rules, the broker dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser s written agreement to the transaction. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our Common Stock. Since our Common Stock is subject to the regulations applicable to penny stocks, the market liquidity for our Common Stock could be adversely affected because the regulations on penny stocks could limit the ability of broker dealers to sell our Common Stock and thus your ability to sell our Common Stock in the secondary market in the future. We can provide no assurance that our Common Stock will be quoted or listed on any trading platform of higher quality than the OTCID, including the OTCQB, NYSE American or any exchange, even if eligible, in the future. 28 It is possible that our Common Stock will continue to experience volatility in its trading volume and its market price. Our Common Stock is quoted in the over-the-counter market under the symbol LUDG on the OTCID. For over the past five years, our Common Stock has experienced both volume and price volatility. The market for low-priced securities is generally less liquid and more volatile than securities traded on national stock markets. Wide fluctuations in market prices are not uncommon. The price of our Common Stock may be subject to wide fluctuations in response to factors such as the following, some of which are beyond our control: quarterly variations in our operating results; operating results that vary from the expectations of investors; changes in expectations as to our future financial performance, including financial estimates by investors; reaction to our periodic filings, or presentations by executives at investor and industry conferences; changes in our capital structure; announcements of innovations or new products by us or our competitors; announcements by us or our competitors of significant contracts, acquisitions, strategic partnerships, joint ventures or capital commitments; lack of success in the expansion of our business operations; third-party announcements of claims or proceedings against us or adverse developments in pending proceedings; additions or departures of key personnel; asset impairment; temporary or permanent inability to offer products or services; and rumors or public speculation about any of the above factors. If our quarterly operating results fall below the expectations of investors or securities analysts, the price of our Common Stock could decline substantially. Furthermore, any quarterly fluctuations in our operating results may, in turn, cause the price of our stock to fluctuate substantially. We believe that quarterly comparisons of our financial results are not necessarily meaningful and should not be relied upon as an indication of our future performance. In the past, following periods of volatility in the market price of a company s securities, securities class-action litigation often has been instituted against that company. Such litigation, if instituted against us, could cause us to incur substantial costs to defend such claims and divert management s attention and resources. The costs of being a public company could result in us being unable to continue as a going concern. As a public company, we are required to comply with numerous financial reporting and legal requirements, including those pertaining to audits and internal control. The costs of maintaining public company reporting requirements could be significant and may preclude us from seeking financing or equity investment on terms acceptable to us and our stockholders. We estimate these costs to be approximately $75,000 per year and may be higher if our business volume or business activity increases significantly. We estimate that our costs will increase if we are able to successfully uplist to . To the extent that funds generated from any private placements, public offerings and/or bank financing are insufficient, we will have to raise additional working capital and no assurance can be given that additional financing will be available, or, if available, will be on acceptable terms. The recent interest rate hikes and the present conditions and state of the United States and global economies make it difficult to predict whether and/or when and to what extent a recession has occurred or will occur in the near future. These conditions potentially raise substantial doubt about our ability to continue as a going concern. If adequate working capital is not available, we may be forced to discontinue operations, which would cause investors to lose their entire investment. 29 Risks Related to Our Organization and Structure Our holding company structure makes us dependent on our subsidiaries for our cash flow and could serve to subordinate the rights of our stockholders to the rights of creditors of our subsidiaries, in the event of an insolvency or liquidation of any such subsidiary. The Company acts as a holding company and, accordingly, substantially all of our operations are conducted through our subsidiaries. Such subsidiaries will be separate and distinct legal entities. As a result, substantially all of our cash flow will depend upon the earnings of our subsidiaries. In addition, we will depend on the distribution of earnings, loans or other payments by our subsidiaries. No subsidiary will have any obligation to provide the Company with funds for our payment obligations. If there is an insolvency, liquidation or other reorganization of any of our subsidiaries, our stockholders will have no right to proceed against their assets. Creditors of those subsidiaries will be entitled to payment in full from the sale or other disposal of the assets of those subsidiaries before the Company, as a stockholder, would be entitled to receive any distribution from that sale or disposal. Risks Relating to This Offering and the Reverse Stock Split The proposed reverse stock split could cause our stock price to decline relative to its value before the split and decrease the liquidity of shares of our Common Stock. We plan to effect a reverse stock split of our issued and outstanding common stock prior to the effectiveness and closing of this offering in order to achieve a sufficient increase in our stock price to enable us to qualify for listing on the . There is no assurance that the reverse stock split will not cause an actual decline in the value of our outstanding Common Stock. The liquidity of the shares of our common stock may be affected adversely by the reverse stock split given the reduced number of shares that will be outstanding following the reverse stock split, especially if the market price of our Common Stock does not increase as a result of the reverse stock split. In addition, the reverse stock split may increase the number of stockholders who own odd lots (less than 100 shares) of our common stock, creating the potential for such stockholders to experience an increase in the cost of selling their shares and greater difficulty effecting such sales. Even if we effect a reverse stock split of our Common Stock, we cannot assure you that the market price of our Common Stock will remain high enough for such reverse split to have the intended effect of complying with s minimum bid price requirement. In connection with and prior to this Offering and the uplist of our Common Stock to , we intend to effect a reverse stock split of our Common Stock at a specific ratio within a range from one-for-50 to one-for-250 to allow us to obtain approval of our initial listing application to list our Common Stock on the . Even if such reverse split of our Common Stock occurs, there can be no assurance that the market price of our Common Stock following the reverse stock split will remain at the level required for continuing compliance with that requirement. It is not uncommon for the market price of a company s Common Stock to decline in the period following a reverse stock split. If the market price of our Common Stock declines following the effectuation of the reverse stock split, the percentage decline may be greater than would occur in the absence of a reverse stock split. In any event, other factors unrelated to the number of shares of our Common Stock outstanding, such as negative financial or operational results, could adversely affect the market price of our Common Stock and thus jeopardize our ability to meet or maintain the s minimum bid price requirement. There has been no independent valuation of the stock, which means that the stock may be worth less than the purchase price. The Offering price of the Common Stock in this Offering has been determined by us and the Underwriter, as hereinafter defined, without independent valuation of the Common Stock. We established the offering price based on management s estimate of the value of the Common Stock. This valuation is highly speculative and arbitrary. There is no relation to the market value, book value, or any other established criteria. We did not obtain an independent appraisal opinion on the valuation of the. Common Stock. The Common Stock may have a value significantly less than the offering price and the Common Stock may never obtain a value equal to or greater than the offering price. 30 The sale or availability for sale of substantial amounts of Common Stock could adversely affect their market price. Sales of substantial amounts of the Common Stock in the public market after the completion of this Offering, or the perception that these sales could occur, could adversely affect the market price of the Common Stock and could materially impair our ability to raise capital through equity offerings in the future. The Common Stock sold in this Offering will be freely tradable without restriction or further registration under the Securities Act, and shares held by our existing shareholders may also be sold in the public market in the future subject to the restrictions in Rule 144 and Rule 701 under the Securities Act and the applicable lockup agreements. There will be shares of Common Stock outstanding immediately after this Offering, or shares of Common Stock if the underwriters exercise their option to purchase our shares in full. In connection with this Offering, we, our directors and executive officers and the holders of 5% or more of our outstanding Common Stock have agreed with the underwriter, subject to certain exceptions, not to sell, transfer or dispose of, directly or indirectly, any of Common Stock or securities convertible into or exercisable or exchangeable for the Common Stock for a period of 6 months after the date of this prospectus, for Directors and Officers, and 3 months, in the case of other 5% or greater holders of our common stock. However, the underwriters may release these securities from these restrictions at any time. We cannot predict what effect, if any, market sales of securities held by our significant shareholders or any other holders or the availability of these securities for future sale will have on the market price of the Common Stock. See Underwriting and Shares Eligible for Future Sale for a more detailed description of the restrictions on selling our securities after this Offering. The underwriters of this Offering may waive or release parties to the lock-up agreements entered into in connection with this Offering, which could adversely affect the price of our Common Stock. We, our directors, executive officers and holders of 5% or more of our Common Stock have entered into lock-up agreements with respect to our and their respective shares of Common Stock. As restrictions on resale end, the market price of our Common Stock could decline if the holders of restricted shares sell them or are perceived by the market as intending to sell them. ThinkEquity LLC, as representative of the underwriters, at any time and without notice, may release all or any portion of the shares of Common Stock subject to the foregoing lock-up agreements entered into in connection with this Offering. If the restrictions under the lock-up agreements are waived, approximately million shares of Common Stock will be available for sale into the market, which could reduce the market value for our Common Stock. If we are not able to comply with the applicable continued listing requirements or standards of , could delist our securities. We intend to apply to have our Common Stock listed on under the symbol and we anticipate that our Common Stock will begin trading on immediately following the completion of this Offering. Although, after effecting the Reverse Stock Split and giving effect to this Offering we expect to meet the minimum initial listing standards set forth in the Listing Standards, we cannot assure you that our securities will be, or will continue to be, listed on in the future. In order to maintain that listing, we must satisfy minimum financial and other continued listing requirements and standards, including those regarding director independence and independent committee requirements, minimum stockholders equity, minimum share price, and certain corporate governance requirements. We may not be able to comply with the applicable listing standards and could delist our securities as a result. We cannot assure you that our Common Stock, if delisted from , will be listed on another national securities exchange. If our Common Stock is delisted by , our Common Stock would likely trade on the OTC Markets where an investor may find it more difficult to sell our shares or obtain accurate quotations as to the market value of our Common Stock. 31 Techniques employed by short sellers may drive down the market price of the Common Stock. Short selling is the practice of selling securities that the seller does not own but rather has borrowed from a third party with the intention of buying identical securities back at a later date to return to the lender. The short seller hopes to profit from a decline in the value of the securities between the sale of the borrowed securities and the purchase of the replacement shares, as the short seller expects to pay less in that purchase than it received in the sale. As it is in the short seller s interest for the price of the security to decline, many short sellers publish, or arrange for the publication of, negative opinions regarding the relevant issuer and our prospects to create negative market momentum and generate profits for themselves after selling a security short. These short attacks have, in the past, led to selling of shares in the market. It is not clear what effect such negative publicity could have on us. If we were to become the subject of any unfavorable allegations, whether such allegations are proven to be true or untrue, we could have to expend significant resources to investigate such allegations and/or defend ourselves. While we would strongly defend against any such short seller attacks, we may be constrained in the manner in which we can proceed against the relevant short seller by principles of freedom of speech, applicable state law or issues of commercial confidentiality. Such a situation could be costly and time-consuming, and could distract our management from growing our business. Even if such allegations are ultimately proven to be groundless, allegations against us could severely impact our business, and any investment in the Common Stock could be greatly reduced or even rendered worthless. If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, the market price for the Common Stock and trading volume could decline. The trading market for the Common Stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. If research analysts do not establish and maintain adequate research coverage or if one or more of the analysts who covers us downgrades the Common Stock or publishes inaccurate or unfavorable research about our business, the market price for the Common Stock would likely decline. If one or more of these analysts ceases coverage of our Company or fails to publish reports on us regularly, we could lose visibility in the financial markets, which, in turn, could cause the market price or trading volume for the Common Stock to decline. We may be subject to securities litigation, which is expensive and could divert our management s attention. The market price of our securities may be volatile, and in the past companies that have experienced volatility in the market price of their securities have been subject to securities class action litigation. We may be the target of this type of litigation in the future. Securities litigation against us could result in substantial costs and divert our management s attention from other business concerns, which could seriously harm our business. We may issue preferred stock with terms that could adversely affect the voting power or value of our Common Stock. Our amended certificate of incorporation authorizes us to issue, without the approval of our stockholders, one or more classes or series of preferred stock having such designations, preferences, limitations and relative rights, including preferences over our Common Stock with respect to dividends and distributions, as our board of directors may determine. The terms of one or more classes or series of preferred stock could adversely impact the voting power or value of our Common Stock. For example, we might grant holders of preferred stock the right to elect some number of our directors in all events or upon the happening of specified events or the right to veto specified transactions. Similarly, the repurchase or redemption rights or liquidation preferences we might assign to holders of preferred stock could affect the residual value of our Common Stock. 32 Since we do not anticipate paying any cash dividends on our capital stock in the foreseeable future, stock price appreciation, if any, will be your sole source of gain. We currently intend to retain all of our future earnings, if any, to finance the growth and development of our business. In addition, the terms of any future debt agreements may preclude us from paying dividends. As a result, appreciation, if any, in the market price of our Common Stock will be your sole source of gain for the foreseeable future. We may need additional capital, and we may be unable to obtain such capital in a timely manner or on acceptable terms, or at all. Furthermore, our future capital needs may require us to sell additional equity or debt securities that may dilute our stockholders or introduce covenants that may restrict our operations or our ability to pay dividends. To grow our business and remain competitive, we may require additional capital from time to time for our daily operation. In addition to the proceeds of this offering, we may continue to seek capital through private placement transactions. Our ability to obtain additional capital is subject to a variety of uncertainties, including: our market position and competitiveness in our industry; our future profitability, overall financial condition, results of operations and cash flows; and economic, political and other conditions in the U.S. We may be unable to obtain additional capital in a timely manner or on acceptable terms or at all. In addition, our future capital needs and other business reasons could require us to sell additional equity or debt securities or obtain a credit facility. The sale of additional equity or equity-linked securities could dilute our stockholders. The incurrence of indebtedness would result in increased debt service obligations and could result in operating and financing covenants that would restrict our operations or our ability to pay dividends to our stockholders. Our existing stockholders have substantial influence over our Company and their interests may not be aligned with the interests of our other stockholders, which may discourage, delay or prevent a change in control of our Company, which could deprive our stockholders of an opportunity to receive a premium for their securities. As of the date of this prospectus, certain stockholders of management control an aggregate majority of voting power in us. As a result, these stockholders have substantial influence over our business, including decisions regarding mergers, consolidations and the sale of all or substantially all of our assets, election of directors and other significant corporate actions. This concentration of ownership may discourage, delay or prevent a change in our control, which could deprive our stockholders of an opportunity to receive a premium for their shares as part of any contemplated sale of our Company and may reduce the price of our Common Stock. Our management will have broad discretion over the use of proceeds from this Offering and may not use the proceeds effectively. Our management will have considerable discretion in the application of the net proceeds, and you will not have the opportunity, as part of your investment decision, to assess whether the proceeds are being used appropriately. The net proceeds may be used for corporate purposes that do not improve our operating results or enhance the value of our securities. Our expected use of net proceeds from this Offering represents our current intentions based upon our present plans and business condition. As of the date of this prospectus, we cannot predict with certainty all of the particular uses for the net proceeds to be received upon the completion of this Offering. The amounts and timing of our actual use of the net proceeds will vary depending on numerous factors, including amount of cash used in our operations, which can be highly uncertain, subject to substantial risks and can often change. Our management will have broad discretion in the application of the net proceeds, and investors will be relying on our judgment regarding the application of the net proceeds of this Offering. The failure by our management to apply these funds effectively could harm our business. Pending their use, we may invest the net proceeds from this Offering in short-term, investment-grade, interest-bearing securities. These investments may not yield a favorable return to our stockholders. If we do not invest or apply the net proceeds from this Offering in ways that enhance stockholder value, we may fail to achieve expected financial results, which could cause our stock price to decline. 33 USE OF PROCEEDS We estimate the net proceeds to us from this Offering will be approximately $ prior to deducting estimated offering expenses payable by us in the approximate amount of $ . We anticipate that the net cash proceeds of this Offering will be used primarily to execute our business plan and will include expenditures for equipment, marketing, staffing, legal expenses, accounting expense, Company awareness, research and clinical trials, debt repayment and the exercise of an option to buy back certain shares of our Common Stock. Additionally, net cash proceeds will be used for paying general and administrative expenses associated with this Offering and paying general and administrative expenses associated with being a listed public company, including accounting, auditing, transfer agent, EDGAR filing and legal expenses. The precise amounts that we will devote to our programs will vary depending on numerous factors, including, but not limited to, the progress and results of our research and assessments as to the market for our products that are in development. In the event that we sell less than the maximum Common Stock offered in this Offering, our first priorities are to pay fees associated with product development and their market introduction. We plan to use the net proceeds of this Offering primarily for the following purpose Estimated Amount of Net Proceeds General and Administrative Expenses $ Sales & Marketing Expenses $ Research and Clinical Trials $ Repayment of Notes Payable(1) $ Working Capital $ Estimated offering expenses Total Net Proceeds $ (1) These debts relate to loans obtained by us to pay ongoing operating expenses. $1,040,000 of OID notes, maturing on December 31, 2025, of which $500,000 will be automatically converted into Common Stock upon the effectiveness of this registration statement, and $540,000 will be repaid from the proceeds of the Offering. See Management s Discussion and Analysis of Financial Condition and Result of Operations--Convertible Promissory Notes for a complete description of our outstanding Convertible Promissory Notes that will be repaid in part with the proceeds of this Offering. We intend to use $3,000,000 from this Offering, to commence three separate clinical studies. We believe that we may need to raise additional funds either through equity sales, debt offerings or through the sales of our Revealia test kits to complete the trials. As we have not begun the clinical trials yet, we are uncertain as to the full cost of completing all three trials, but we estimate that we will require at least $3,000,000. We believe that the proceeds of this Offering will be enough for us to complete our proposed clinical trials, however, we may need to raise additional funds to complete them and there is no assurance that we will be able to raise the additional funds required to do so. See Business- Planned Future Clinical Trials for a complete description of our planned clinical trials below. We intend to deploy a direct-to-consumer marketing campaign for our proprietary RevealiaTM mRNA testing kits. In addition, we intend to retain outside parties to implement a company awareness that would serve to increase our Company s visibility within its target markets, as well as within the investment community. Our management believes that building investor awareness of our Company is an important aspect of any company that seeks to uplist its stock to a higher quality market, to benefit its shareholders. As we expand our operations with proceeds from this Offering, it will be necessary to hire key personnel, including a Chief Marketing Officer and a Chief Compliance Officer, as well as ancillary support staff (e.g., warehouse, staff accountants, bookkeeper, marketing analyst, sales representatives, bio-analytics specialist). The amounts and timing of our actual expenditures will depend on numerous factors, including the progress of our business growth strategy and the scale achieved by our sales and marketing team, as well as the amount of cash used in our operations. We therefore cannot estimate with certainty the amount of net proceeds to be used for the purposes described above. We may find it necessary or advisable to use the net proceeds for other purposes, and we will have broad discretion in the application of the net proceeds. 34 DETERMINATION OF THE OFFERING PRICE Prior to this Offering, there has been a limited public market for our Common Stock. Our Common Stock currently trades on the OTCID where it is quoted under the symbol LUDG. The public offering price of the shares of Common Stock will be negotiated between us and the Underwriter. The principal factors to be considered in determining the public offering price include: the information set forth in this prospectus and otherwise available to ThinkEquity; our history and prospects and the history and prospects for the industry in which we compete; our past and present financial performance; our prospects for future earnings and the present state of our development; the general condition of the securities market at the time of this Offering; the recent market prices of, and demand for, publicly traded shares of generally comparable companies; and other factors deemed relevant by the underwriters and us. The assumed public offering price set forth on the cover page of this preliminary prospectus is subject to change as a result of market conditions and other factors. Neither we nor the underwriters can assure investors that an active trading market will develop for our shares of Common Stock or that the shares of Common Stock will trade in the public market at or above the public offering price. 35 CAPITALIZATION The following table sets forth our cash, cash equivalents, short-term investments, and capitalization as of June 30, 2025: on an actual basis; on a pro forma basis to reflect the following: to give effect to our proposed reverse stock split at an assumed ratio of 1-for-100, which ratio is in the range within which our stockholders have authorized our Board to determine, in its sole discretion, the specific ratio and timing of such reverse stock split, and assuming that such reverse stock split would be effected prior to the effectiveness of this Offering. on a pro forma as adjusted basis to further reflect the following in addition to the pro forma adjustments set forth above: (i) the issuance and sale of shares of Common Stock offered in this Offering at an assumed public offering price of $ per share. , after deducting underwriting discounts and commissions, non-accountable expense allowance and estimated offering expenses of $ million, assuming the underwriters do not exercise their over-allotment option, (ii) the issuance of shares of our Common Stock that will be issued upon the automatic conversion at the effectiveness of this Offering of approximately $126,000 of accrued interest and original issuance discount of our Convertible Notes, and (iii) 2,325,482 shares of our Common Stock that may be issued upon the conversion of our outstanding Convertible Preferred Stock. You should read this information together with our audited consolidated financial statements appearing elsewhere in this prospectus and the information set forth under the sections titled Selected Consolidated Financial Data, Use of Proceeds and Management s Discussion and Analysis of Financial Condition and Results of Operations. As of June 30, 2025 Actual Pro Forma Pro Forma As Adjusted Cash and cash equivalents 142,474 142,474 Debt 2,648,717 648,717 Preferred stock: 7,000,000 authorized; $0.001 par value, 7,000,000 shares issued and outstanding 7,000 7,000 Common stock: $0.001 par value, 1,250,000,000 shares authorized, 161,569,807 shares issued and outstanding at June 30, 2025, 1,615,698 shares issued and outstanding pro forma and shares issued and outstanding pro forma as adjusted 161,568 162 Additional Paid in Capital 4,879,025 5,040,434 Accumulated Deficit (8,449,753) (8,449,753) Total Stockholders Equity / (Deficit) (3,402,160) (3,402,160) Total Equity 401,274 401,274 Total Capitalization (3,000,886) (3,000,886) Each $1.00 increase (decrease) in the assumed public offering price of $ per share would increase (decrease) the pro forma as adjusted amount of each of cash and cash equivalents, additional paid-in capital, total stockholders equity and total capitalization by approximately $ , assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated offering expenses payable by us. Similarly, each increase (decrease) of 100,000 shares in the number of shares offered by us, assuming that the assumed public offering price of $ per share remains the same, would increase (decrease) the pro forma as adjusted amount of each of cash and cash equivalents, additional paid-in capital, total stockholders equity and total capitalization by approximately $ . The effectiveness of this registration statement will result in an automatic conversion under the terms of approximately $ in our outstanding Convertible Notes. Effective as of October 3, 2024, we have agreed with the holders of our Convertible Notes to amend and restate each of the Convertible Notes to extend the maturity dates to April 3, 2025. Subsequently, as of June 9, 2025, we have agreed with the holders of our Convertible Notes to amend and restate each of the Convertible Notes to extend the maturity dates to September 30, 2025. Subsequently, as of September 10, 2025, we have agreed with the holders of our Convertible Notes to amend and restate each of the Convertible Notes to extend the maturity dates to December 31, 2025. The number of shares of Common Stock to be outstanding after this Offering is based on 161,569,807 shares of Common Stock outstanding as of June 30, 2025, and excludes, as of that date, the following: Outstanding warrants to purchase 2,080,000 shares of Common Stock at $0.30 per share; and Outstanding warrants to purchase 2,604,667 shares of Common Stock at $0.19 per share; and Subject to the adjustments provided therein, we have reserved for issuance 30,000,000 shares of Common Stock Pursuant to our 2024 Stock Incentive Plan 36 DIVIDEND POLICY We have not declared or paid any cash dividends on our capital stock since our inception. We intend to retain future earnings, if any, to finance the operation and expansion of our business and do not anticipate paying any cash dividends in the foreseeable future. Declaration or payment of dividends, if any, in the future, will be at the discretion of our board of directors and will depend on our then current financial condition, results of operations, capital requirements and other factors deemed relevant by the There are no contractual restrictions on our ability to declare or pay dividends. Consequently, you will only realize an economic gain on your investment in our Common Stock if the price appreciates. You should not purchase our Common Stock expecting to receive cash dividends. Since we do not anticipate paying dividends, and if we are not successful in establishing an orderly public trading market for our shares, then you may not have any manner to liquidate or receive any payment on your investment. Therefore, our failure to pay dividends may cause you to not see any return on your investment even if we are successful in our business operations. In addition, because we may not pay dividends in the foreseeable future, we may have trouble raising additional funds which could affect our ability to expand our business operations. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS Market Information Our Common Stock is currently quoted on the OTC under the trading symbol LUDG. Quotations on the OTC reflect inter-dealer prices, without retail mark-up, mark-down commission, and may not represent actual transactions. On , 2025, the reported closing price of our Common Stock was $ ($ assuming a reverse stock split of 1-for-100) per share. Shareholders of Record We have 619 shareholders of record of our Common Stock as of September 15, 2025. Securities Authorized for Issuance Under Our Equity Compensation Plan During and prior to fiscal year 2023 we had not adopted an equity compensation plan, however, during fiscal 2024 our Board of Directors adopted an equity compensation plan. See Executive Compensation - Equity Compensation Plan for a complete description of our adopted equity compensation plan. As of the date of this prospectus no grants have been made pursuant to our compensation plan. FORWARD LOOKING STATEMENTS Information included or incorporated by reference in this prospectus may contain forward-looking statements. This information may involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from the future results, performance or achievements expressed or implied by any forward-looking statements. Forward looking statements, which involve assumptions and describe our future plans, strategies and expectations, are generally identifiable by use of the words may, should, expect, anticipate, estimate, believe, intend or project or the negative of these words or other variations on these words or comparable terminology. This prospectus contains forward looking statements, including statements regarding, among other things, (a) our projected sales and profitability, (b) our production and technology, (c) the regulation to which we are subject, (d) anticipated trends in our industry and(e) our needs for working capital. These statements may be found under Management s Discussion and Analysis or Plan of Operations and Business, as well as in this prospectus generally. Actual events or results may differ materially from those discussed in forward-looking statements as a result of various factors, including, without limitation, the risks outlined under Risk Factors and matters described in this prospectus generally. In light of these risks and uncertainties, there can be no assurance that the forward-looking statements contained in this prospectus will in fact occur. Except as otherwise required by applicable laws, we undertake no obligation to publicly update or revise any forward-looking statements or the risk factors described in the prospectus, whether as a result of new information, future events, changed circumstances or any other reason after the date of this prospectus. 37 DILUTION If you invest in the Common Stock, your interest will be diluted to the extent of the difference between the public offering price per share and our pro forma net tangible book value of the Common Stock after this Offering. Dilution results from the fact that the public offering price per share of Common Stock is substantially in excess of the book value per share of Common Stock attributable to the existing shareholders for our presently outstanding Common Stock. Our net tangible book value as of June 30, 2025, was (3,402,780) or approximately $(0.02) per share. Net tangible book value per share represents the amount of total tangible assets, minus the amount of total liabilities, divided by the total number of shares of Common Stock outstanding. On a pro forma basis to reflect the following in addition to the pro forma adjustments set forth above to give effect to our proposed reverse stock split at an assumed ratio of 1-for-100, which ratio is in the range within which our stockholders have authorized our Board to determine, in its sole discretion, the specific ratio and timing of such reverse stock split, and assuming that such reverse stock split would be effected prior to the effectiveness of this Offering. On an as adjusted pro forma basis to net tangible book value as of June 30, 2025 was $ or approximately $ per share on a pro forma basis to further reflect (i) the issuance of shares of our Common Stock that will be issued upon the automatic conversion at the effectiveness of this Offering of approximately $ of accrued interests and original issuance discount of our Convertible Notes, (ii) the issuance of shares of Common Stock since June 30, 2025, (iii) the issuance of shares of our Common Stock that will be issued upon the conversion at the effectiveness of this Offering of our outstanding Convertible Preferred Stock. As of June 30, 2025 Actual Pro Forma Pro Forma As Adjusted $ $ $ Total Tangible Assets 400,654 400,654 Total Liabilities 3,803,434 3,803,434 Net Tangible Book Value (3,402,160) (3,402,160) Common Stock Outstanding 161,569,807 1,659,698 Net Tangible Book Value per share of Common Stock $(0.02) $(2.05) $ After giving further effect to our issuance and sale of shares of Common Stock offered in this Offering at the assumed public offering price of $ per share after deduction of the underwriting discounts and commissions, non-accountable expense allowance and estimated offering expenses payable by us of $ , and assuming the underwriters do not exercise their over-allotment option, on an as adjusted basis our net tangible book value as of June 30, 2025 would have been approximately $ million, or $ per share, to existing shareholders and an immediate dilution in net tangible book value of $ per share, to purchasers of Common Stock in this Offering. Assuming the underwriters exercise their over-allotment option, our pro forma as adjusted net tangible book value as of June 30, 2025 would have been approximately $ million, or $ per share, to existing shareholders and an immediate dilution in net tangible book value of $ per share, to purchasers of Common Stock in this Offering. The following table illustrates the dilution: Pro Forma Offering without Over-allotment Option Pro Forma as Adjusted Assumed public offering price per share $ $ $ Net tangible book value per share as of June 30, 2025 $ $ $ Pro forma net tangible book value per share as of June 30, 2025 $ $ $ Increase in pro forma net tangible book value per share attributable to new investors purchasing shares in this Offering $ $ $ Pro forma as adjusted net tangible book value per share as of June 30, 2025, after giving effect to this offering $ $ $ Dilution per share to new investors in this Offering $ $ $ 38 The pro forma information as discussed above is illustrative only. Our net tangible book value following the completion of this Offering is subject to adjustment based on the actual public offering price of our Common Stock in this Offering. A $1.00 increase (decrease) in the assumed public offering price of $ per share would increase (decrease) our pro forma as adjusted net tangible book value as of June 30, 2025 after this Offering by approximately $ , or approximately $ per share, and would change dilution to investors in this Offering to $ per share, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same, after deducting the underwriting discount and estimated offering expenses payable by us. We may also increase or decrease the number of shares we are offering. An increase (decrease) of 100,000 in the number of shares we are offering would increase (decrease) our pro forma as adjusted net tangible book value as of June 30, 2025 after this Offering by approximately $ , or approximately $ per share, and would change dilution to investors in this Offering to $ , assuming the assumed public offering price per share remains the same, after deducting the underwriting discount and estimated offering expenses payable by us. The following charts illustrate our proportionate ownership, upon completion of this Offering by present stockholders and investors in this Offering, compared to the relative amounts paid by each. The charts reflect payment by present stockholders as of the date the consideration was received and by investors in this Offering at the public offering price. The charts further assume no changes in net tangible book
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+PROSPECTUS SUMMARY
+This summary highlights information contained elsewhere in this prospectus. This summary is not complete and does not contain all of the information you should consider in making your investment decision. Before investing in our common stock, you should carefully read the entire prospectus, including the risks of investing in our securities discussed under the heading Risk Factors and Special Note Regarding Forward-Looking Statements. You should also carefully read our financial statements and the exhibits to the registration statement of which this prospectus forms a part. Unless the context otherwise requires, the terms Mustang Mustang Bio the Company, we, us, our and similar references in this prospectus refer to Mustang Bio, Inc., the registrant on the cover page of the registration statement of which this prospectus forms a part.
+Our Business
+Overview and Product Candidate Development
+We are a clinical-stage biopharmaceutical company focused on translating today s medical breakthroughs into potential cures for difficult-to-treat cancers. We aim to acquire rights to these technologies by licensing or otherwise acquiring an ownership interest in the technologies, funding their research and development and eventually either out-licensing or bringing the technologies to market.
+Our pipeline is currently focused in two core areas: CAR T therapies for hematologic malignancies and CAR T therapies for solid tumors. For these therapies we have partnered with world class research institutions, including the City of Hope National Medical Center ( COH or City of Hope ), Fred Hutchinson Cancer Center ( Fred Hutch ), and Nationwide Children s Hospital ( Nationwide ).
+CAR T Therapies
+Our pipeline of CAR T therapies is being developed under exclusive licenses from several world class research institutions. Our strategy is to license these technologies, support preclinical and clinical research activities by our partners and transfer the underlying technology to our or our contract manufacturer s cell processing facility in order to conduct our own clinical trials.
+We are developing CAR T therapy for hematologic malignancies in partnership with Fred Hutch targeting CD20 (MB-106). In May 2021, we announced that the U.S. Food and Drug Administration ( FDA ) accepted our Investigational New Drug ( IND ) Application for MB-106. As of January 2025, 53 patients have been treated in an ongoing Phase 1 clinical trial sponsored by Fred Hutch (ClinicalTrials.gov Identifier: NCT03277729) and 20 patients have been treated in the Phase 1 clinical trial sponsored by us (ClinicalTrials.gov Identifier: NCT05360238). In 2023, we received Safety Review Committee approval to continue dose escalation in all three active arms of the ongoing Mustang-sponsored Phase 1 trial. We presented the latest results, demonstrating a favorable safety profile, complete response rate, and durability, from the ongoing Mustang-sponsored Phase 1 trial at the 2023 American Society of Hematology ( ASH ) Annual Meeting.
+We are also developing CAR T therapy for solid tumors in partnership with COH targeting IL13R 2 (MB-101). In addition, we have partnered with Nationwide for a herpes simplex virus type 1 ( HSV-1 ) oncolytic virus (MB-108) in order to enhance the activity of MB-101 for the treatment of patients with high-grade malignant brain tumors. The Phase 1 clinical trial sponsored by COH for MB-101 (ClinicalTrials.gov Identifier: NCT02208362) has completed the treatment phase and patients continue to be assessed for long-term safety. A Phase 1 clinical trial sponsored by the University of Alabama at Birmingham ( UAB ) for MB-108 (ClinicalTrials.gov Identifier: NCT03657576) began during the third quarter of 2019. In October 2023, we announced that the FDA accepted our IND application for the combination of MB-101 and MB-108 which is referred to as MB-109 for the treatment of patients with IL13R 2+ relapsed or refractory glioblastoma ( GBM ) and high-grade astrocytoma.
+MB-106 (CD20-targeted CAR T cell therapy for Non-Hodgkin Lymphoma and Chronic Lymphocytic Leukemia)
+In the first quarter of 2024, we completed a successful End-of-Phase 1 meeting with the FDA regarding a potential pivotal Phase 2 single-arm clinical trial for the treatment of WM. Per the discussions, the FDA agreed with the proposed overall design of the pivotal trial for Waldenstrom macroglobulinemia ( WM ) at the recommended dose of 1 x 107 CAR-T cells/kg and requested only minimal modifications to the study protocol. No additional nonclinical studies are expected prior to Phase 2 or a Biologics License Application ( BLA ) filing. Due to limited resources, and as a result of the reduction in work force described below, we do not expect to initiate our pivotal Phase 2 single-arm clinical trial of MB-106 for the treatment of WM trial in 2025. Subject to available funds, we intend to rely on third party service providers to conduct study and manufacturing services to advance our priority potential product candidates.
+
+7
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+Table of Contents
+
+Also in the first quarter of 2024, we completed enrollment of the indolent lymphoma arm in our multicenter Phase 1 trial. The tenth and final patient enrolled on that arm was a patient with follicular lymphoma (FL) who achieved a complete response following treatment with 1 x 107 CAR-T cells/kg. As a result, the overall complete response rate for FL in the Phase 1 portion of this trial was sustained at 100% (N=6), with no occurrence of cytokine release syndrome ( CRS ) above grade 1 and no immune effector cell-associated neurotoxicity syndrome ( ICANS ) of any grade, despite not using prophylactic tocilizumab or dexamethasone.
+In March 2024, we announced plans to collaborate with Fred Hutch for a proof-of-concept Phase 1 investigator-sponsored clinical trial evaluating MB-106 in autoimmune diseases.
+In March 2024, we were granted the Regenerative Medicine Advanced Therapy ( RMAT ) designation by the FDA for the treatment of relapsed or refractory CD20 positive WM and FL, based on potential improvement in response as seen in clinical data to date. Drugs eligible for RMAT designation are those intended to treat, modify, reverse or cure a serious or life-threatening disease or condition, and that present preliminary clinical evidence indicating the drug has the potential to address unmet medical needs for such disease or condition. RMAT designation provides regenerative medicine advanced therapy products with the same benefits to expedite the development and review of a marketing application that are available to drugs that receive Breakthrough Therapy Designation. These advantages include timely advice and interactive communications with FDA, as well as proactive and collaborative involvement by senior FDA managers and experienced review and regulatory health project management staff. A product designated as an RMAT also may be eligible for other FDA-expedited programs, such as Priority Review. The FDA also may conduct a rolling review of products in its expedited programs, reviewing portions of a marketing application before the complete application is submitted.
+In June 2024, we announced that updated data for MB-106 in the Phase 1/2 Fred Hutch investigator-sponsored trial showed a favorable safety and efficacy profile in 10 patients with WM. There was an overall response rate ( ORR ) of 90% with durable responses observed, including three complete responses ( CR ), two very good partial responses ( VGPR ), and four partial responses ( PR ). One of the patients who achieved a CR remained in remission for 31 months, with an immunoglobulin M (IgM) level that decreased rapidly to the normal range after treatment with MB-106 and remained normal since. Patients had a median of nine prior lines of therapy, and only one patient started additional anti-WM treatment after being treated with MB-106. From a safety perspective, CRS occurred in nine patients: five patients with grade 1 and four patients with grade 2. One patient experienced grade 1 ICANS. No grade 3 or 4 CRS or grade 2, 3 or 4 ICANS was observed, despite dose escalation.
+In May 2024, we informed the clinical sites participating in the Mustang-sponsored Phase 1/2 study in non-Hodgkin lymphoma and chronic lymphocytic leukemia, MB106-CD20-001, that we had decided to close the trial. In June 2024, we similarly informed the clinical sites participating in the Mustang-sponsored Long-term Follow-up Study in Patients Previously Treated with Mustang Bio, Inc. CAR-T Cell Investigational Products, MB100-OBS-001, that we had decided to close that trial. As a result, further clinical development of MB-106 is currently focused solely on autoimmune diseases unless funding and resources become available to restart the program for hematologic malignancies. Planning for the aforementioned Phase 1 investigator-sponsored clinical trial in autoimmune diseases is in progress, with initiation of the trial planned for 2025.
+MB-109 (Combination of MB-101 CAR T Therapy with MB-108 Oncolytic Virus Therapy for Malignant Brain Tumors)
+In October 2023, we received a safe-to-proceed approval from the FDA for our MB-109 IND application allowing us to initiate a Phase 1, open-label, non-randomized, multicenter study of MB-109 in patients with IL13R 2+ recurrent GBM and high-grade astrocytoma. In this Phase 1 clinical study, we intend to evaluate the combination of CAR-T cells (MB-101) and the herpes simplex virus type 1 oncolytic virus (MB-108) in patients with IL13R 2+ high-grade gliomas. The design of this study involves first a lead-in cohort, wherein patients are treated with MB-101 alone without prior MB-108 administration. After successful confirmation of the safety profile of MB-101 alone, the study will then investigate increasing doses of intratumorally administered MB-108 followed by dual intratumoral (ICT) and intraventricular (ICV) administration of MB-101.
+On November 7, 2024, we announced that the FDA granted Orphan Drug Designation to Mustang for MB-108, a herpes simplex virus type 1 ( HSV-1 ) oncolytic virus, for the treatment of malignant glioma. The Orphan Drug Designation provides certain incentives, such as tax credits toward the cost of clinical trials upon approval and prescription drug user fee waivers. If a product receives Orphan Drug Status from the FDA, that product is entitled to seven years of market exclusivity for the disease in which it has Orphan Drug designation, which is independent from intellectual property protection. We are currently exploring with COH to conduct an investigator-sponsored single-institution trial under the COH IND to treat patients with IL13R 2+ recurrent GBM and high-grade astrocytoma with MB-109 and could potentially be initiated in the second half of 2025. 
+
+8
+
+Table of Contents
+
+To date, we have not received approval for the sale of any of our product candidates in any market and, therefore, have not generated any product sales from our product candidates. In addition, we have incurred substantial operating losses since our inception, and expect to continue to incur significant operating losses for the foreseeable future and may never become profitable. As of September 30, 2024, we have an accumulated deficit of $395.8 million.
+Recent Developments
+October 2024 Private Placement
+On October 24, 2024, we entered into an inducement offer letter agreement (the Inducement Letter ) with an institutional accredited investor (the Investor ) which held certain outstanding (i) Series A-1 Warrants to purchase up to an aggregate of 337,552 shares of common stock, (ii) Series A-2 Warrants to purchase up to an aggregate of 337,552 shares of common stock, and (iii) Series A-3 Warrants to purchase up to an aggregate of 337,552 shares of common stock, originally issued to the Investor on May 2, 2024 (the May 2024 Warrants ). The May 2024 Warrants had an exercise price of $11.85 per share.
+Pursuant to the Inducement Letter, the Investor agreed to exercise in full, for cash, the Series A-3 Warrants (the Existing Warrants ) at the exercise price of $11.85 per share in consideration for our agreement to issue in a private placement (x) new Series B-1 Warrants to purchase Series B-1 Warrant Shares and (y) new Series B-2 Warrants to purchase Series B-2 Warrant Shares. In addition, we issued to H.C. Wainwright & Co., LLC ( H.C. Wainwright, together with the Investor, the Holders ) or its designees placement agent warrants to purchase shares of our common stock. The placement agent warrants have the same terms as the Series B-1 Warrants, except that the placement agent warrants have an exercise price equal to $14.82 per share. The transactions contemplated by the Inducement Letter closed on October 25, 2024. We received aggregate gross proceeds of approximately $4 million from the exercise of the Existing Warrants by the Investor, before deducting placement agent fees and other expenses payable by us.
+Non-Compliance with Nasdaq Continued Listing Requirements
+On March 13, 2024, we received a deficiency letter (the Letter ) from the Listing Qualifications Department (the Staff ) of Nasdaq notifying us that we were not in compliance with the minimum stockholders equity requirement for continued listing on the Nasdaq Capital Market under Nasdaq Listing Rule 5550(b)(1) (the Equity Rule ). The Equity Rule requires companies listed on the Nasdaq Capital Market to maintain stockholders equity of at least $2.5 million (or, in the alternative, a market value of listed securities of $35 million or net income from continued operations of $500,000 in the most recently completed fiscal year or in two of the last three most recently completed fiscal years). As of December 31, 2023, we reported stockholders equity of $123,000, and as of September 30, 2024, we reported stockholders deficit of approximately $8.7 million.
+The Letter had no immediate effect on our continued listing on Nasdaq, subject to our compliance with the other continued listing requirements. In accordance with the Nasdaq Listing Rules, we were provided 45 calendar days, or until April 29, 2024, to submit a plan to regain compliance with the Equity Rule (the Compliance Plan ). We submitted our Compliance Plan on April 29, 2024, and the Staff granted our request for an extension of 180 calendar days through September 9, 2024, to regain compliance with the Equity Rule. We were unable to demonstrate compliance with the Equity Rule by September 9, 2024.
+On September 10, 2024, the Staff formally notified us that it had determined to delist our securities from Nasdaq based upon our continued non-compliance with the Equity Rule unless we timely request a hearing before the Nasdaq Hearings Panel (the Panel ). On September 17, 2024, we requested a hearing before the Panel, which stayed any further action by Nasdaq at least pending completion of the hearing and the expiration of any extension that may be granted by the Panel to us following the hearing.
+On May 16, 2024, we received a notice (the Second Letter ) from the Staff of Nasdaq indicating that the bid price of our common stock had closed below $1.00 per share for 31 consecutive business days and, as a result, we were not in compliance with Nasdaq Listing Rule 5550(a)(2), which sets forth the minimum bid price requirement for continued listing on the Nasdaq Capital Market (the Bid Price Rule ). The Second Letter from Nasdaq had no immediate effect on the listing of our common stock on Nasdaq. Pursuant to Nasdaq Listing Rule 5810(c)(3)(A), we were afforded a 180-calendar day grace period, or until November 12, 2024, to regain compliance with the Bid Price Rule. Compliance can be achieved by evidencing a closing bid price of at least $1.00 per share for a minimum of ten consecutive business days (but generally not more than 20 consecutive business days) during the 180-calendar day grace period.
+
+9
+
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+The hearing before the Panel occurred on October 29, 2024. By decision dated November 8, 2024, the Panel granted our request for an extension to evidence compliance with all applicable criteria for continued listing on the Nasdaq Capital Market, including the Bid Price Rule, through January 31, 2025, and the Equity Rule through February 18, 2025. We are considering all available options that may enable us to timely evidence compliance with the continued listing criteria and maintain our listing on Nasdaq. There can be no assurance that we will be successful in our efforts to maintain the listing of our common stock on the Nasdaq Capital Market.
+Reverse Stock Split
+On January 15, 2025, we filed a certificate of amendment (the Amendment ) to our amended and restated certificate of incorporation, as amended, with the Secretary of State of the State of Delaware, to effect a 1-for-50 reverse stock split of our issued and outstanding common stock, without any change to par value. The Amendment became effective upon such filing. No fractional shares were issued in connection with the reverse stock split as all fractional shares were rounded down to the next whole share. The reverse stock split was intended to bring the Company into compliance with Nasdaq s Bid Price Rule.
+All share and per share amounts of our common stock listed in this prospectus have been adjusted to give effect to the reverse stock split.
+Corporate Information
+We are a majority-controlled subsidiary of Fortress Biotech, Inc. ( Fortress ). We were incorporated under the laws of the State of Delaware on March 13, 2015. Our principal executive offices are located at 377 Plantation Street, Worcester, Massachusetts 01605, and our telephone number is 781-652-4500. We maintain a website on the Internet at www.mustangbio.com and our e-mail address is info@mustangbio.com. Information on our website, or any other website, is not incorporated by reference in this prospectus. We have included our website address in this prospectus solely as an inactive textual reference.
+Implications of Being a Smaller Reporting Company
+We are a smaller reporting company as defined in the Securities Exchange Act of 1934, as amended (the Exchange Act ). We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as (i) the market value of our voting and non-voting common stock held by non-affiliates is less than $250 million measured on the last business day of our second fiscal quarter or (ii) our annual revenue is less than $100 million during the most recently completed fiscal year and the market value of our voting and non-voting common stock held by non-affiliates is less than $700 million measured on the last business day of our second fiscal quarter. Specifically, as a smaller reporting company, we may choose to present only the two most recent fiscal years of audited financial statements in our Annual Reports on Form 10-K and have reduced disclosure obligations regarding executive compensation, and if we are a smaller reporting company with less than $100 million in annual revenue, we would not be required to obtain an attestation report on internal control over financial reporting issued by our independent registered public accounting firm.
+ 
+
+10
+
+Table of Contents
+
+Risks Associated with the Company
+Our business is subject to a number of risks of which you should be aware before making a decision to invest in our common stock. These risks are more fully described in the section titled Risk Factors immediately following this prospectus summary. These risks include, among others, the following:
+Risks Related to our Finances and Capital Requirements
+ We have incurred significant losses since our inception and anticipate that we will incur continued losses for the foreseeable future.
+ There is substantial doubt regarding our ability to continue as a going concern. We will need to raise additional financing in upcoming periods, which may not be available on acceptable terms to us, or at all. Failure to obtain necessary capital when needed may force us to delay, limit or terminate our potential product candidates.
+ We have not generated any revenue from our development stage products, and we do not know when, or if, we will generate any revenue.
+ Our short operating history makes it difficult to evaluate our business and prospects.
+ Our success is contingent on raising additional capital, and our efforts to do so may fail. Even if successful, our future capital raising activities may dilute our current stockholders, restrict our operations, or cause us to relinquish proprietary rights.
+
+Risks Pertaining to our Business Strategy, Structure and Organization
+ Our future growth and success depend on our ability to successfully develop, and, if approved, commercialize our product candidates, which we have yet to do.
+ Our future success is highly dependent on the successful development of our chimeric antigen receptor ( CAR ) engineered T cell ( CAR T ) technology and oncolytic virus product candidates.
+ Our strategic pivot for our lead product candidate, MB-106, and our disposal of non-core assets, including our facility, may not result in the cost savings we anticipate and could result in total costs and expenses that are greater than expected.
+
+Risks Inherent in Drug Development and Commercialization
+ Preclinical development is highly speculative and carries a high failure risk.
+ We may not receive the required regulatory approvals for any of our product candidates on our projected timelines, if at all, which may result in increased costs and delay our ability to generate revenue.
+ We may not obtain the desired labeling claims or intended uses for product promotion, or favorable scheduling classifications, to successfully promote our product candidates, if approved.
+ If a product candidate demonstrates adverse side effects, we may need to abandon or limit the development of such product candidate.
+ Even if a product candidate is approved, it may be subject to various post-marketing requirements, including studies or clinical trials, and increased regulatory scrutiny.
+ Our competitors may develop treatments for our products target indications, which could limit our product candidates commercial opportunity and profitability.
+ If our product candidates, if approved, are not broadly accepted by the healthcare community, the revenues from any such product will likely be limited.
+ Any successful products liability claims related to any of our current or future product candidates may cause us to incur substantial liability and limit the commercialization of any such products.
+
+Risks Related to Reliance on Third Parties
+ We rely, and expect to continue to rely, on third parties to conduct our preclinical studies and clinical trials, and those third parties may not perform satisfactorily, including failing to meet deadlines for the completion of such trials or complying with applicable regulatory requirements.
+ We contract with third parties for the manufacture of our product candidates for preclinical and clinical testing and may also do so for commercialization, if and when our product candidates are approved.
+
+11
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+ We rely on clinical data and results obtained by third parties, which may prove inaccurate or unreliable.
+ We may need to license certain intellectual property from third parties, and such licenses may not be available or may not be available on commercially reasonable terms.
+
+Risks Relating to Legislation and Regulation Affecting the Biopharmaceutical and Other Industries
+ We operate in a heavily regulated industry, and we cannot predict the impact that any future legislation or administrative or executive action may have on our operations, particularly with the new presidential administration in the United States.
+ We may be subject to anti-kickback, fraud and abuse, false claims, transparency, health information privacy and security and other healthcare laws and regulations, which could expose us to criminal sanctions, civil penalties, contractual damages, reputational harm, administrative burdens and diminished profits and future earnings.
+ We are subject to numerous environmental, health and safety laws and regulations and could become subject to fines or penalties or incur costs that could harm our business.
+
+Risks Pertaining to Intellectual Property and Potential Disputes with Licensors Thereof
+ If we are unable to obtain and maintain sufficient patent protection for our technology and products, our competitors could develop and commercialize products similar or identical to ours and our ability to successfully commercialize our technology and products could therefore be impaired.
+ We depend on our licensors to maintain and enforce the intellectual property rights covering certain of our product candidates.
+ We or our licensors may be subject to costly and time-consuming litigation for infringement of third-party intellectual property rights or to enforce our or our licensors intellectual property rights against third-party infringers.
+ Any dispute with our licensors may affect our ability to develop or commercialize our product candidates.
+
+Risks Relating to Our Control by Fortress Biotech, Inc. ( Fortress )
+ Fortress controls a voting majority of our common stock and has the right to receive significant share grants annually, which will result in dilution of our other stockholders and could reduce the value of our common stock.
+ We have entered into certain agreements with Fortress and may have received better terms from unaffiliated third parties.
+ We share certain directors with Fortress, which could create conflicts of interest between us and Fortress.
+
+Risks Relating to this Offering
+ You will experience immediate dilution in the book value per share of the common stock purchased in
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+Prospectus Summary," "Risk Factors,"
+"Use of Proceeds," "Management s Discussion and Analysis of Financial Condition and Results of Operations,"
+"Industry Overview" and "Business." These statements relate to events that involve known and unknown
+risks, uncertainties, and other factors, including those listed under "Risk Factors," which may cause our actual results,
+performance, or achievements to be materially different from any future results, performance or achievements expressed or implied by
+the forward-looking statements.
+
+ 
+
+In
+some cases, these forward-looking statements can be identified by words or phrases such as "believe," "plan,"
+"expect," "intend," "should," "seek," "estimate," "will," "aim"
+and "anticipate," or other similar expressions, but these are not the exclusive means of identifying such statements. All
+statements other than statements of historical fact included in this document, including those regarding future financial positions and
+results, business strategies, plans and objectives of management for future operations (including development plans and dividends) and
+statements on future industry growth are forward-looking statements. In addition, we and our representatives may from time to time make
+other oral or written statements that are forward-looking statements, including in our periodic reports that we will file with the SEC,
+other information sent to our shareholders and other written materials.
+
+ 
+
+These
+forward-looking statements are subject to risks, uncertainties, and assumptions, some of which are beyond our control. In addition, these
+forward-looking statements reflect our current views with respect to future events and are not a guarantee of future performance. Actual
+outcomes may differ materially from the information contained in the forward-looking statements as a result of a number of factors, including,
+without limitation, the risk factors set forth in "Risk Factors" and in this section of the prospectus.
+
+ 
+
+Important
+factors that could cause our actual results to differ materially from those in the forward-looking statements include, but are not limited
+to, regional, national, or global political, economic, business, competitive, market and regulatory conditions and the following:
+
+ 
+
+ 
+ 
+ 
+ our
+ business strategies, operating plans, and business prospects;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ capital commitment plans and funding requirements;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ ability to effectuate and manage our planned business expansion;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ ability to attract customers and maintain customer loyalty;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ ability to retain senior management team members and recruit qualified and experienced new team members;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ ability to maintain competitiveness and operational efficiency;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ prospective financial conditions;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ general
+ economic market and business and financial conditions in Hong Kong, the PRC and globally;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ laws,
+ regulations, and rules for the beauty and personal care industry in Hong Kong and globally;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ future
+ trends, developments, and conditions in the beauty and personal care industry in Hong Kong and globally;
+
+ 
+
+ 2
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ certain
+ statements in "Management s Discussion and Analysis of Financial Condition and Results of Operations" with
+ respect to trends in prices, volumes, and operations;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ ability to execute our strategies;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ changes
+ in the need for capital and the availability of financing and capital to fund those needs;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ our
+ ability to anticipate and respond to changes in the markets in which we operate, and to client demands, trends and preferences;
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ exchange
+ rate fluctuations, including fluctuations in the exchange rates of currencies that are used in our business;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ changes
+ in interest rates or rates of inflation; 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ legal,
+ regulatory, and other proceedings arising out of our operations; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ other
+ factors that are described in "Risk Factors."
+
+ 
+ 
+
+The
+forward-looking statements made in this prospectus relate only to events or information as of the date on which the statements are made
+in this prospectus. Except as required by law, we undertake no obligation to update nor revise publicly any forward-looking statements,
+whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the
+occurrence of unanticipated events. You should read this prospectus and the documents that we reference in this prospectus and have filed
+as exhibits to the registration statement, of which this prospectus is a part, completely and with the understanding that our actual
+future results or performance may be materially different from what we expect.
+
+ 
+
+This
+prospectus contains certain data and information that we obtained from various researches and other publications. Statistical data in
+these publications also include projections based on a number of assumptions. The markets for providing medical cosmetology services
+and traditional facial services may not grow at the rate projected by such market data, or at all. Failure of our industry to grow at
+the projected rate may have a material and adverse effect on our business and the market price of our Ordinary Shares. Furthermore, if
+any one or more of the assumptions underlying the market data are later found to be incorrect, actual results may differ from the projections
+based on these assumptions. You should not place undue reliance on these forward-looking statements.
+
+ 
+
+DEFINITIONS
+
+ 
+
+"Amended
+and Restated Memorandum and Articles" means the amended and restated memorandum of association and articles of association of the
+Company adopted by special resolution of the Company passed on March 19, 2025, currently in effect, a copy of which is filed as Exhibit
+3.1 to the registration statement, of which this prospectus forms a part.
+
+ 
+
+"Business
+Day" means a day (other than a Saturday, Sunday, or public holiday in the U.S.) on which licensed banks in the U.S. are generally
+open for normal business to the public.
+
+ 
+
+"BVI"
+means the British Virgin Islands.
+
+ 
+
+"CAGR"
+means compound annual growth rate.
+
+ 
+
+"CEO"
+means chief executive officer.
+
+ 
+
+"Class A Ordinary Shares" means class
+A ordinary shares, par value US$0.0001 per share, of the Company.
+
+ 
+
+"Class B Ordinary Shares" means class
+B ordinary shares, par value US$0.0001 per share, of the Company.
+
+ 
+
+"Companies
+Act" means the Companies Act (as revised) of the Cayman Islands, as amended, supplemented and/or otherwise modified from time to
+time.
+
+ 
+
+"Companies
+Ordinance" means the Companies Ordinance (Chapter 622 of the laws of Hong Kong) as amended, supplemented, or otherwise modified.
+
+ 
+
+"Controlling
+Shareholder" means, with respect to the Company, Mr. Ng Hon Kin, individually, and MCL, a British Virgin Islands company, as a
+group, where the context requires.
+
+ 
+
+ 3
+
+ 
+
+ 
+
+ 
+
+"COVID-19"
+means the Coronavirus Disease 2019.
+
+ 
+
+"DCMCL"
+means Doctor s Concept Medical and Cosmetics Company Limited, a private company limited by shares incorporated on June 21, 2006
+under the laws of Hong Kong, holding trademarks in Hong Kong.
+
+ 
+
+"Exchange
+Act" means the United States Securities Exchange Act of 1934, as amended.
+
+ 
+
+"GCHL"
+or "Operating Subsidiary" means Grand Century Holding Company Limited, a private company limited by shares incorporated on
+March 31, 2004 under the laws of Hong Kong, which conducts substantially all our business operations in Hong Kong
+
+ 
+
+"Group,"
+"our group," "we," "us," or "our" means the Company and its subsidiaries or any of them,
+or where the context so requires, in respect of the period before our Company became the holding company of its current subsidiaries,
+such subsidiaries as if they were subsidiaries of our Company at the relevant time or the businesses which have since been acquired or
+carried on by them or, as the case may be, their predecessors.
+
+ 
+
+"Hong Kong" refers to Hong Kong Special
+Administrative Region of the People s Republic of China.
+
+ 
+
+"HK$," "HKD" or "Hong Kong
+dollar(s)" refers to the legal currency of Hong Kong.
+
+ 
+
+"ISL"
+means Ideal Success Limited, a Cayman Islands company incorporated on February 28. 2024, which is a 100% holding company of MCL with
+no business operations.
+
+ 
+
+"MCL"
+means Master Centric Limited, a British Virgin Islands company incorporated on December 15, 2023, in which 99% of the issued and outstanding
+shares are owned by Mr. Ng.
+
+ 
+
+"MEDG",
+"Company," "we," "us" or "our" means our holding company, MEDI Group Limited, an exempted
+company with limited liability incorporated on March 13, 2024 under the laws of the Cayman Islands.
+
+ 
+
+"Mr.
+Ng Hon Kin" or "Mr. Ng" means NG Hon Kin, our chairman, CEO and executive director.
+
+ 
+
+"Nasdaq
+Market" means an online global electronic marketplace for buying and selling securities, which operates 25 markets, 1 clearinghouse
+and 5 central securities depositories in the United States and Europe.
+
+ 
+
+"Ordinary Shares" means Class A Ordinary
+Shares and Class B Ordinary Shares of the Company.
+
+ 
+
+"PRC"
+or "China" refer to the People s Republic of China, including Hong Kong, Macau Special Administrative Regions of the
+People s Republic of China ("Macau"), and Taiwan. However, for purposes of laws and regulations, and their respective
+promulgators and enforcers, "PRC" or "China" refers only to the jurisdiction of mainland China, excluding Hong
+Kong, Macau, and Taiwan.
+
+ 
+
+"Reorganization"
+means the reorganization arrangements undertaken by our Group in preparation for the listing on the Nasdaq Market, which are described
+in more detail in "History and Corporate Structure" in this prospectus.
+
+ 
+
+"MTHL"
+means MEDI Trade Holding Limited, a Hong Kong company incorporated on March 21, 2024, an intermediate holding company of our group with
+direct shareholdings in other subsidiaries of ours.
+
+ 
+
+"MTL"
+means MEDI Trade Corporation Limited, a Hong Kong company incorporated on March 22, 2024, which is currently a dormant company but will
+serve as the treasury of our group after this offering. 
+
+ 
+
+"Securities
+Act" means the U.S. Securities Act of 1933, as amended.
+
+ 
+
+"SEC"
+or "Securities and Exchange Commission" means the United States Securities and Exchange Commission.
+
+ 
+
+"sq. ft." means square feet.
+
+ 
+
+"U.S." means the United States.
+
+ 
+
+"US$,"
+"$" or "USD" means the United States dollar, the lawful currency of the United States.
+
+ 
+
+Due
+to rounding, numbers presented throughout this prospectus may not add up precisely to the totals provided and percentages may not precisely
+reflect the absolute figures.
+
+ 
+
+ 4
+
+ 
+
+ 
+
+ 
+
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that may be
+important to you, and we urge you to read this entire prospectus carefully, including the "Risk Factors," "Business"
+and "Management s Discussion and Analysis of Financial Condition and Results of Operations" sections and our consolidated
+financial statements and notes to those statements, included elsewhere in this prospectus, before deciding to invest in our Ordinary
+Shares. This prospectus includes forward-looking statements that involve risks and uncertainties. See "Special Note Regarding Forward-Looking
+Statements." Unless otherwise stated, all references to "us," "our," "we," the "Company,"
+and similar designations refer to MEDG, a Cayman Islands exempted company with limited liability.
+
+ 
+
+Overview
+and Corporate History
+
+ 
+
+MEDG,
+incorporated on March 13, 2024, under the laws of the Cayman Islands, is the holding company of our group. Through our Operating Subsidiary,
+we have over two decades of experience providing principally medical cosmetology services and traditional/normal beauty treatments in
+Hong Kong. Our operating history began in 2004 when GCHL was founded in Hong Kong by Mr. Ng Hon Kin to provide medical aesthetic and
+traditional/normal beauty treatments and products. As the medical aesthetic services legally need a registered medical practitioner,
+Mr. Ng started GCHL by partnering with a Hong Kong registered medical practitioner, who is an experienced practitioner of medical cosmetics
+in Hong Kong, to provide medical cosmetology services to high-end customers.
+
+ 
+
+We target consumers in
+the middle market. Our value proposition is that we deliver quality aesthetics solutions tailored to the unique needs of each customer
+at competitive prices. Our strategy is to differentiate ourselves by offering high-quality treatments and personalized services at a
+reasonable price instead of generic services at a discounted price. To cultivate customer loyalty, we seek to nurture a sense of belonging
+by personalizing the visitor experience so that our customers perceive our brand as one that aligns with their values and lifestyle.
+
+ 
+
+We
+have experienced fluctuations in revenue since the COVID-19 pandemic measures were lifted in early 2023. Our net revenue for the six
+months ended December 31, 2024 and 2023 was US$3.25 million and US$3.86 million, respectively, representing a year-over-year decrease
+of 16%. Our net income for the six months ended December 31, 2024 and 2023 was US$1 million (30.2% of net revenue) and US$0.9 million
+(23.2% of net revenue), respectively, representing a year-over-year increase of 9.6%. Our net revenue for the
+years ended June 30, 2024 and 2023 was US$6.11 million and US$8.02 million, respectively, representing a year-over-year decrease of 24%.
+Our net income for the years ended June 30, 2024 and 2023 was US$0.61 million (9.9% of net revenue) and US$1.90 million (23.7% of net
+revenue), respectively, representing a year-over-year decrease of 68%. The decline in net income was mostly the result of increased audit
+fees and staff costs for this offering.
+
+ 
+
+ 5
+
+ 
+
+ 
+
+ 
+
+Reorganization
+
+ 
+
+Effective
+on March 28, 2024, our Group completed the Reorganization to consolidate its business operations in Hong Kong into an offshore corporate
+holding structure, to expand our operations, and prepare for listing on a recognized securities market. The Company was incorporated
+on March 13, 2024. On March 19, 2025, the Company further restructured its share structure into a dual-class structure. The primary reason
+for this offering and our listing on the Nasdaq Market is to allow us to raise funds, strengthen our market position, further expand
+our market share in Hong Kong and overseas, launch skin care and beauty products, and conduct research and development on medical cosmetology
+devices, services and products. The net proceeds from this offering to sell Class A Ordinary Shares by us will be used for, among other
+things: (i) expanding our market penetration in Southeast Asia; (ii) building our research and development ability and capability; (iii)
+penetrating and further expanding in existing market; and (iv) meeting general working capital needs. We will not receive any of the
+proceeds from the sale of the Ordinary Shares by the Selling Shareholders. We believe that a public listing status will also enhance
+our corporate profile for the public and potential clients and investors. For details, please refer to the section headed "Use
+of Proceeds" on page 48 of this prospectus and History and Corporate Structure on page 69 of this
+prospectus.
+
+ 
+
+As of the date of this prospectus:
+(i) MCL, which is 99% indirectly owned by Mr. Ng Hon Kin, owns 65% of the total issued and outstanding capital of our Company; (ii) our
+Company is a holding company and owns 100% of MTHL; and (iii) MTHL owns 100% of GCHL, DCMCL and MTL.
+MCL owns 97.38% voting rights and the remaining shareholders of Class A Ordinary Shares own 2.62% voting rights of the Company. The
+following diagram illustrates our corporate structure as of the date of this prospectus and on the completion of this offering. For more
+details on our corporate history, please refer to "History and Corporate Structure" on page 69 of this prospectus.
+
+ 
+
+The
+diagram below depicts our organizational structure immediately following this offering assuming no exercise by the underwriters of their
+option to purchase additional shares of Class A Ordinary Shares and based on an assumed initial public offering price of $4.5
+per share, the midpoint of the price range set forth on the cover page of this prospectus.
+
+ 
+
+ 6
+
+ 
+
+ 
+
+ 
+
+Pre-Offering
+(1)
+
+ 
+
+ 
+ Mr.
+ NG Hon Kin
+ 
+ 
+ Ms.
+ HUANG Hsi En
+ 
+ 
+ 
+ 
+ Many
+ Trillion Int l Ltd. (BVI) 
+
+ 
+ 
+ 99%
+ 
+ 
+ 
+ 1%
+ 
+ 
+ 
+ 5%
+ (4)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Sirius
+ Capital Holdings Ltd. (HK)
+ 
+ Class
+ A
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Express
+ Essential Holding Ltd. (BVI)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 100%
+ 
+ 5%
+ (5)
+
+ 
+ 
+ 
+ Ideal
+ Success Limited (Cayman)
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ Sirius
+ Capital Investment Ltd. (HK)
+ 
+ 
+ Winlover
+ Ltd. (BVI)
+
+ 
+ 
+ 
+ 
+ 100%
+ 
+ 
+ 
+ 5%
+ (6)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 10%
+ 
+ Class
+ A
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Essential
+ Quality Ltd. (BVI)
+
+ 
+ 
+ 
+ Master
+ Centric Ltd. (BVI)
+ 
+ 
+ Ace
+ Miracle Group Ltd. (BVI)
+ 
+ 3%
+ (7)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 65%
+ (2)
+ 
+ 
+ 
+ 10%
+ (3)
+ 
+ 
+ MCA
+ Ltd. (HK)
+
+ 
+ 
+ 
+ 
+ Class
+ B
+ 
+ 
+ 
+ Class
+ A
+ 
+ 2%
+ (8)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Able
+ Talent Business Ltd. (BVI)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 5%
+ (9)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ MEDI
+ Group Limited (Cayman)
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 100%
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ MEDI
+ Trade Holding Limited (HK)
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 100%
+ 
+ 
+ 100%
+ 
+ 100%
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Grand
+ Century Holding Co., Ltd. (HK)
+ 
+ Doctor s
+ Concept Medical and Cosmetics Co., Ltd. (HK)
+ 
+ MEDI
+ Trade Corporation Limited (HK)
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ Note:
+ 
+ 
+
+ 
+ (1)
+ Based
+ on 27,000,000 Ordinary Shares, consist of 9,450,000 Class A Ordinary Shares and 17,550,000 Class B Ordinary Shares, issued and outstanding
+ immediately prior to the offering.
+
+ 
+ (2)
+ Represents
+ 17,550,000 Class B Ordinary Shares.
+
+ 
+ (3)
+ Represents
+ 2,700,000 Class A Ordinary Shares.
+
+ 
+ (4)
+ Represents
+ 1,350,000 Class A Ordinary Shares.
+
+ 
+ (5)
+ Represents
+ 1,350,000 Class A Ordinary Shares.
+
+ 
+ (6)
+ Represents
+ 1,350,000 Class A Ordinary Shares.
+
+ 
+ (7)
+ Represents
+ 810,000 Class A Ordinary Shares.
+
+ 
+ (8)
+ Represents
+ 540,000 Class A Ordinary Shares.
+
+ 
+ (9)
+ Represents
+ 1,350,000 Class A Ordinary Shares. 
+
+ 
+ 
+
+Post-Offering
+(assuming no exercise of the underwriters over-allotment option) (1)
+
+ 
+
+ 
+ Mr.
+ NG Hon Kin
+ 
+ 
+ Ms.
+ HUANG Hsi En
+ 
+ 
+ 
+ 
+ Many
+ Trillion Int l Ltd. (BVI)
+ 
+ 
+
+ 
+ 
+ 99%
+ 
+ 
+ 
+ 1%
+ 
+ 
+ 
+ 4.45%
+ (4)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Sirius
+ Capital Holdings Ltd. (HK)
+ 
+ Class
+ A
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Express
+ Essential Holding Ltd. (BVI)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 100%
+ 
+ 4.45%
+ (5)
+ 
+ 
+
+ 
+ 
+ 
+ Ideal
+ Success Limited (Cayman)
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ Sirius
+ Capital Investment Ltd. (HK)
+ 
+ 
+ Winlover
+ Ltd. (BVI)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 100%
+ 
+ 
+ 
+ 4.45%
+ (6)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 10%
+ 
+ Class
+ A
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Essential
+ Quality Ltd. (BVI)
+ 
+ 
+
+ 
+ 
+ 
+ Master
+ Centric Ltd. (BVI)
+ 
+ 
+ Ace
+ Miracle Group Ltd. (BVI)
+ 
+ 2.67%
+ (7)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 57.86%
+ (2)
+ 
+ 
+ 
+ 8.90%
+ (3)
+ 
+ 
+ MCA
+ Ltd. (HK)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Class
+ B
+ 
+ 
+ 
+ Class
+ A
+ 
+ 1.78%
+ (8)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Able
+ Talent Business Ltd. (BVI)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 4.45%
+ (9)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ MEDI
+ Group Limited (Cayman)
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 100%
+ 
+ 
+ 
+ Public
+ (New Issue)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ MEDI
+ Trade Holding Limited (HK)
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 10.99% (10)
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Class A
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 100%
+ 
+ 
+ 100%
+ 
+ 100%
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Grand
+ Century Holding Co., Ltd. (HK)
+ 
+ Doctor s
+ Concept Medical and Cosmetics Co., Ltd. (HK)
+ 
+ MEDI
+ Trade Corporation Limited (HK)
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ Note:
+ 
+ 
+
+ 
+ (1)
+ Based
+ on 30,333,333 Ordinary Shares outstanding immediately after the offering assuming the underwriter does not exercise the over-allotment
+ option.
+
+ 
+ (2)
+ Represents
+ 17,550,000 Class B Ordinary Shares, 222,222 of which will be converted to Class A Ordinary Shares and subject to resale. 
+
+ 
+ (3)
+ Represents
+ 2,700,000 Class A Ordinary Shares.
+
+ 
+ (4)
+ Represents
+ 1,350,000 Class A Ordinary Shares, which will be subject to resale.
+
+ 
+ (5)
+ Represents
+ 1,350,000 Class A Ordinary Shares, which will be subject to resale.
+
+ 
+ (6)
+ Represents
+ 1,350,000 Class A Ordinary Shares.
+
+ 
+ (7)
+ Represents
+ 810,000 Class A Ordinary Shares.
+
+ 
+ (8)
+ Represents
+ 540,000 Class A Ordinary Shares.
+
+ 
+ (9)
+ Represents
+ 1,350,000 Class A Ordinary Shares, which will be subject to resale.
+
+ 
+ (10)
+ Represents
+ 3,333,333 Class A Ordinary Shares. 
+
+ 
+ 
+
+ 7
+
+ 
+
+ 
+
+ 
+
+Purchasers
+in this offering are buying shares of MEDG, a Cayman Islands company, whereas all of our operations are conducted through our Operating
+Subsidiary. At no time will the Company s shareholders directly own shares of our Hong Kong subsidiaries.
+
+ 
+
+We
+are and will be a "controlled company" as defined under the Nasdaq Stock Market Rules because, immediately after the completion
+of this offering, our Controlling Shareholder, will own 17,550,000 of our total issued and outstanding Ordinary Shares, representing
+97.38% of the total voting power in our Company, assuming that the underwriters do not exercise their over-allotment
+option.
+
+ 
+
+Our
+Business 
+
+ 
+
+Our
+mission is to be an industry leader in providing high-end medical cosmetology services and traditional facial or spa services.
+
+ 
+
+Competitive
+Strengths
+
+ 
+
+We
+believe the following competitive strengths differentiate us from our competitors:
+
+ 
+
+ 
+ 
+ 
+ High customer retention rate
+
+ 
+ 
+ 
+ Upscale customer experience
+
+ 
+ 
+ 
+ Broad range of beauty treatments
+
+ 
+ 
+ 
+ Stringent quality control
+
+ 
+ 
+
+Our
+Strategies
+
+ 
+
+We
+intend to pursue the following strategies to further expand our business:
+
+ 
+
+ 
+ 
+ 
+ Expand our geographical footprints
+
+ 
+ 
+ 
+ Broaden our service offerings to cater to high-growth
+ segments
+
+ 
+ 
+ 
+ Upgrade and broaden our service offerings
+
+ 
+ 
+ 
+ Recruit, train and maintain a team of experienced and
+ dedicated management and senior beauty professionals
+
+ 
+ 
+
+Permission
+Required from Hong Kong and PRC Regulators
+
+ 
+
+As
+of the date of this prospectus, based on a legal opinion from our Hong Kong counsel, O Tse & Co, we are not required to obtain any
+permission or approval from the Hong Kong regulators to operate our business or issue our Ordinary Shares to foreign investors. However,
+we require registered medical practitioner to deliver medical cosmetology services and sell consumable products that require prescription.
+We currently have no operations in the PRC. Thus, we are not required to obtain permissions or approvals from any PRC regulators, including
+CSRC or CAC to list in the U.S. and to issue our Ordinary Shares to foreign investors. 
+
+ 
+
+Nevertheless,
+we are aware that recently, the PRC government initiated a series of regulatory actions and statements to regulate business operations
+in certain areas in mainland China with little advance notice, including cracking down on illegal activities in the securities market,
+enhancing supervision over mainland Chinese companies listed overseas using a variable interest entity ("VIE") structure,
+adopting new measures to extend the scope of cybersecurity reviews, and expanding the efforts in anti-monopoly enforcement. Since these
+statements and regulatory actions are new, it is highly uncertain how soon the legislative or administrative regulation making bodies
+will respond and what existing or new laws or regulations or detailed implementations and interpretations will be modified or promulgated,
+if any. It is also highly uncertain what potential impact such modified or new laws and regulations will have on MEDG s daily business
+operations, its ability to accept foreign investments and the listing of our Ordinary Shares on an U.S. or other foreign exchange. If
+there is significant change to current political arrangements between mainland China and Hong Kong, the PRC government intervenes or
+influences operations of companies operated in Hong Kong like us, or exerts more control through change of laws and regulations over
+offerings conducted overseas and/or foreign investment in issuers like us, it may result in a material change in our operations and/or
+the value of the securities we are registering for sale or could significantly limit or completely hinder our ability to offer or continue
+to offer securities to investors and cause the value of our Ordinary Shares to significantly decline or become worthless. See "Risk
+Factors - Risks Related to Doing Business in the PRC beginning on page 24 and "Risk Factors — Risks Related
+to Our Securities and the Offering" beginning on page 36 of this prospectus for more information. 
+
+ 
+
+Recent
+Development
+
+ 
+
+Geographic
+Optimization of Service Locations
+
+ 
+
+Our
+customers located near northern Hong Kong have increasingly turned to service providers in the mainland China, due to convenience of
+cross border access, resulting in a loss of customers in our Yuen Long operations. Consequently, we plan to close down our Yuen Long
+shop (located at office No. 6-7 and 8-9, 8/F, Kwong Wah Plaza, 11 Tai Tong Road, Yuen Long, New Territories) ("Yuen Long Shop")
+on September 30, 2025, and intend to open new shop in other location in Hong Kong. In preparation for this closure, we, together with
+Be Health Company Limited with whom we share the lease in Yuen Long, entered into a transfer agreement with Beauty Plus Limited on July
+28, 2025 (the "Transfer Agreement"). Under the Transfer Agreement, among other items, the furniture, renovation, beds for
+beauty treatments of the Yuen Long Shop will be sold to Beauty Plus Limited at a total cost of HKD330,000. The Transfer Agreement is
+subject to a condition precedent that the property owner of the Yuen Long Shop signs a new lease agreement with Beauty Plus Limited at
+a specified rental amount.
+
+ 
+
+ 8
+
+ 
+
+ 
+
+ 
+
+Transfers
+of Cash To and From Our Subsidiaries
+
+ 
+
+As
+a holding company, we will rely on dividends and other distributions on equity paid by our Hong Kong subsidiaries for our cash and financing
+requirements. MEDG is permitted under the laws of Cayman Islands to provide funding to our Hong Kong subsidiaries through loans or capital
+contributions without restrictions on the amount of the funds, provided such funding is the best interests of the Company.
+
+ 
+
+Our
+equity structure is a direct holding structure, that is, the overseas entity to be listed in the U.S., MEDG, directly controls MTHL,
+which holds 100% of shares of our Operating Subsidiary and other Hong Kong subsidiaries. Cash is transferred through our organization
+in the following manner: (i) funds may be transferred from MEDG, the holding company incorporated in the Cayman Islands to our Hong Kong
+subsidiaries through MTHL in the form of capital contributions or shareholder loans, as the case may be; and (ii) dividends or other
+distributions may be paid by our Hong Kong subsidiaries to MEDG through MTHL. Our Hong Kong subsidiaries are permitted under the laws
+of Hong Kong to provide funding to MEDG through dividend distribution without restrictions on the amount of the funds or restrictions
+on foreign exchange. If MEDG intends to distribute dividends to its shareholders, it will depend on payment of dividends from our other
+Hong Kong subsidiaries to MTHL in accordance with the laws and regulations of Hong Kong, and MTHL will transfer the dividends to MEDG,
+and the dividends will be distributed by MEDG, subject to applicable Cayman Islands restrictions (see "Dividends and Dividend
+Policy" on page 50), to all shareholders respectively in proportion to the shares they hold, regardless of whether the shareholders
+are U.S. investors or investors in other countries or regions. If MTHL incurs debt on its own in the future, the instruments governing
+such debt may restrict MTHL s ability to pay dividends, make distribution or transfer funds to MEDG. As of the date of this prospectus,
+none of our other subsidiaries have made any dividends or distributions to MTHL. As of the date of this prospectus, we do not have any
+U.S. investors, so no dividends or distributions have been made to any U.S. investors. Both MEDG and MTHL currently intend to retain
+all available funds and future earnings, if any, for the operation and expansion of our business and do not anticipate declaring or paying
+any dividends in the foreseeable future. Any future determination related to our dividend policy will be made at the discretion of our
+board of directors after considering our financial condition, results of operations, capital requirements, contractual requirements,
+business prospects and other factors the board of directors deems relevant, and subject to the restrictions contained in any future financing
+instruments.
+
+ 
+
+Within
+our direct holding structure, the cross-border transfer of funds within our corporate group is legal and compliant with the laws and
+regulations; subject to the laws of Cayman Islands, our
+board of directors has complete discretion as to whether to distribute dividends. In addition, our shareholders may by ordinary resolution
+declare a dividend, but no dividend may exceed the amount recommended by our directors. Under Cayman Islands law, a Cayman Islands company
+may pay a dividend out of either profit or share premium account, provided that in no circumstances may a dividend be paid if this would
+result in the company being unable to pay its debts as they fall due in the ordinary course of business. Even if our board of directors
+decides to declare and pay dividends, the timing, amount and form of future dividends, if any, will depend on our future results of operations
+and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us from the operating entities,
+our financial condition, contractual restrictions and other factors deemed relevant by our board of directors.
+
+ 
+
+ 9
+
+ 
+
+ 
+
+ 
+
+As of the date of this prospectus,
+our Group has not distributed dividends to our shareholders since the incorporation of GCHL. Under the current practice of the Inland
+Revenue Department of Hong Kong, no tax is payable in Hong Kong in respect of dividends paid by us.
+
+ 
+
+There
+are no restrictions or limitation under the laws of Hong Kong imposed on the conversion of HKD into foreign currencies and the remittance
+of currencies out of Hong Kong.
+
+ 
+
+See
+"Dividends and Dividend Policy" on page 50 and Risk Factors Risks Related to Doing Business in
+the PRC – To the extent cash or assets in our business is in the PRC or in our Hong Kong subsidiaries, the funds or assets may
+not be available to fund operations or for other use outside of the PRC due to interventions in or the imposition of restrictions and
+limitations on our ability or the ability of our Hong Kong subsidiaries by the PRC government to transfer cash or assets. 
+on page 26 of this prospectus for more information.
+
+ 
+
+Our
+Corporate Information
+
+ 
+
+Our
+principal executive offices are located at Unit 15-16, 22/F., CEO Tower, 77 Wing Hong Street, Cheung Sha Wan, Kowloon, Hong Kong, and
+our telephone number is +852 2388 1121. Our registered office in the Cayman Islands is at the office of Ogier Global (Cayman) Limited,
+89 Nexus Way, Camana Bay, Grand Cayman, KY1-9009, Cayman Islands. We maintain a website at www.doctorsconcept.com.
+
+ 
+
+Recent
+Regulatory Developments in China
+
+ 
+
+Recently,
+the PRC government initiated a series of regulatory actions and statements to regulate business operations in certain areas in China
+with little advance notice, including cracking down on illegal activities in the securities market, enhancing supervision over Chinese
+companies listed overseas using a VIE, adopting new measures to extend the scope of cybersecurity reviews, and expanding the efforts
+in anti-monopoly enforcement.
+
+ 
+
+On
+July 6, 2021, the General Office of the Communist Party of China Central Committee and the General Office of the State Council jointly
+issued a document to crack down on illegal activities in the securities market and promote the high-quality development of the capital
+market, which, among other things, requires the relevant regulators to strengthen cross-border oversight of law-enforcement and judicial
+cooperation, to enhance supervision over Chinese companies listed overseas, and to establish and improve the system of extraterritorial
+application of the PRC securities laws.
+
+ 
+
+On
+December 28, 2021, Cybersecurity Review Measures were published by Cyberspace Administration of China or the CAC, National Development
+and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, Ministry of State Security, Ministry
+of Finance, Ministry of Commerce, People s
+Bank of China, State Administration of Radio and Television, China Securities Regulatory Commission ("CSRC"),
+State Secrecy Administration and State Cryptography Administration and became effective on February 15, 2022, which provides that,
+Critical Information Infrastructure Operators ("CIIOs")
+that purchase internet products and services and Online Platform Operators engaging in data processing activities that affect or may
+affect national security shall be subject to the cybersecurity review by the Cybersecurity Review Office. On July 7, 2022, CAC promulgated
+the Measures for the Security Assessment of Data Cross-border Transfer, effective on September 1, 2022, which requires the data
+processors to apply for data cross-border security assessment coordinated by the CAC under the following circumstances: (i) any
+data processor transfers important data to overseas; (ii) any critical information infrastructure operator or data processor who
+processes personal information of over 1 million people provides personal information to overseas; (iii) any data processor
+who provides personal information to overseas and has already provided personal information of more than 100,000 people or sensitive
+personal information of more than 10,000 people to overseas since January 1st of the previous year; and (iv) other circumstances
+under which the data cross-border transfer security assessment is required as prescribed by the CAC. We believe we are fully in
+compliance with the regulations or policies that have been issued by the CAC to date.
+
+ 
+
+ 10
+
+ 
+
+ 
+
+ 
+
+On
+August 30, 2024, Chinas State Council approved the "Regulations on Network Data Security Management," which will take effect
+on January 1, 2025. This regulation further refines and improves existing relevant systems. It clearly defines important data as information
+that pertains to specific fields, groups, or regions, or has reached a certain level of precision and scale, and if tampered with, destroyed,
+leaked, or illegally obtained or used, could directly endanger national security, economic operations, social stability, public health,
+and safety. The regulation requires network data handlers to identify and report important data. Additionally, it stipulates that network
+data handlers must fulfill a clear notification obligation before processing personal information. It specifies the conditions under
+which network data handlers can provide personal information overseas, clarifying that if not informed by relevant regions or departments
+or publicly disclosed as important data, it does not need to be reported for data export security assessment. Violations of this regulation
+may result in orders to rectify, warnings, or even suspension of related business operations, business rectification, revocation of relevant
+business licenses, or business license revocation. In cases where the violation affects or may affect national security severely, a fine
+ranging from 1 million to 10 million yuan can be imposed.
+
+ 
+
+Given
+the nature of our business, we believe this risk is not significant. We do not have any customers in China and are not CIIOs nor a DPO
+as defined in the Revised Review Measures. We do not currently expect the Revised Review Measures to have an impact on our business,
+operations or this offering as we do not believe that we are deemed to be operators of critical information infrastructure or data processors
+controlling personal information of no less than one million users, that are required to file for cybersecurity review before listing
+in the U.S. since (i) our Hong Kong subsidiaries are incorporated and operating in Hong Kong and the Revised Review Measures remain unclear
+as to whether they shall be applicable to a Hong Kong company; (ii) as of the date of this prospectus, none of the our Hong Kong subsidiaries
+have collected any personal information of PRC individuals; and (iii) as of the date of this prospectus, none of our Hong Kong subsidiaries
+have been informed by any PRC governmental authority of any requirement that they are required to file for a cybersecurity review. Therefore,
+we believe that our Hong Kong subsidiaries are not covered by the permission and requirements from the CSRC or the CAC.
+
+ 
+
+Nevertheless,
+since these statements and regulatory actions are new, it is highly uncertain how soon the legislative or administrative regulation making
+bodies will respond and what existing or new laws or regulations or detailed implementations and interpretations will be modified or
+promulgated. If the Revised Review Measures are adopted into law in the future and if any of our Hong Kong subsidiaries are deemed an
+"operator of critical information infrastructure" or a "data processor" controlling personal information of no
+less than one million users, the listing of our Ordinary Shares on U.S. stock exchanges could be subject to CAC s cybersecurity
+review. If we become subject to the CAC or any other governmental agency, we cannot assure you that we will be able to list our Ordinary
+Shares on U.S. stock exchanges, or continue to offer securities to investors, which would materially affect the interest of the investors
+and cause significantly depreciation of the price of our Ordinary Shares or render them worthless.
+
+ 
+
+On
+February 17, 2023, the CSRC released the New Overseas Listing Rules with five interpretive guidelines, which took effect on March 31,
+2023. The New Overseas Listing Rules require Chinese domestic enterprises to complete filings with relevant governmental authorities
+and report related information under certain circumstances, such as: a) an issuer making an application for initial public offering and
+listing in an overseas market; b) an issuer making an overseas securities offering after having been listed on an overseas market; c)
+a domestic company seeking an overseas direct or indirect listing of its assets through single or multiple acquisition(s), share swap,
+transfer of shares or other means. The new rules provide that the determination as to whether a Chinese domestic company is indirectly
+offering and listing securities on an overseas market shall be made on a substance over form basis, and if the issuer meets the following
+conditions, the offering and listing shall be determined as an indirect overseas offering and listing by a Chinese domestic company:
+(i) any of the revenue, profit, total assets or net assets of the Chinese domestic entity is more than 50% of the related financials
+in the issuer s audited consolidated financial statements for the most recent fiscal year; (ii) the senior managers in charge
+of business operation and management of the issuer are mostly Chinese citizens or with regular domicile in China, the main locations
+of its business operations are in China or main business activities are conducted in China. If a domestic company fails to complete the
+required filing procedures or conceals any material fact or falsifies any major content in its filing documents, such domestic company
+may be subject to administrative penalties, such as an order to rectify, warnings and fines, and its controlling shareholders, actual
+controllers, the person directly in charge and other directly liable persons may also be subject to administrative penalties, such as
+warnings and fines.
+
+ 
+
+We
+are headquartered in Hong Kong and the majority of our executive officers and directors are based in Hong Kong (except for
+one independent non-executive director who will commence his term immediately prior to the completion of this offering) but not mainland
+Chinese residents. All of our assets are located in Hong Kong and all of our revenues and profits are generated by our subsidiary
+in Hong Kong. We are advised by our Chinese counsel, Guangdong Wesley Law Firm, that the Company is not subject to the New Overseas
+Listing Rules.
+
+ 
+
+However,
+there can be no assurance that the relevant PRC regulators, including the CSRC, would reach the same conclusion as us, or that the CSRC,
+CAC or any other PRC regulators would not promulgate new rules or new interpretation of current rules (with retrospective effect) to
+require us to obtain CSRC, CAC, or other PRC governmental approvals for this offering. If we inadvertently concluded that such approvals
+are not required, our ability to offer or continue to offer our Class A Ordinary Shares to investors could be significantly limited or
+completely hindered, which could cause the value of our Class A Ordinary Shares to significantly decline or become worthless. We may
+also face sanctions by the CSRC, the CAC or other PRC regulators. These regulators may impose fines, penalties, limit our operations
+in China, or take other actions that could have a material adverse effect on our business, financial condition, results of operations
+and prospects, as well as the trading price of our securities. See "Risk Factors" beginning on page 20 for a discussion
+of these legal and operational risks and other information that should be considered before making a decision to purchase our Class A
+Ordinary Shares.
+
+ 
+
+ 11
+
+ 
+
+ 
+
+ 
+
+Summary
+Risk Factors and Challenges
+
+ 
+
+Investing
+in our Class A Ordinary Shares involves risks. The risks summarized below are qualified by reference to "Risk Factors"
+beginning on page 20 of this prospectus, which you should carefully consider before making a decision to purchase our Class A Ordinary
+Shares. If any of these risks actually occurs, our business, financial condition or results of operations would likely be materially
+adversely affected. In such case, the trading price of our Class A Ordinary Shares would likely decline, and you may lose part or all
+of your investment.
+
+ 
+
+These
+risks include but are not limited to the following:
+
+ 
+
+Risks
+Related to Our Business and Industry (for a more detailed discussion, see "Risk Factors – Risks Related to Our Business and
+Industry" beginning on page 20 of this prospectus)
+
+ 
+
+ 
+ 
+ 
+ Our reputation in the industry, which we do not have
+ full control, is critical to our success, see "Risk
+ Factors – Risks Related to Our Business and Industry – Our reputation in the industry, which we do not have full
+ control, is critical to our success" on page 20.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We operate in a highly competitive industry, see
+ "Risk Factors – Risks Related to Our Business and Industry – We operate in a highly competitive industry"
+ on page 20.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Demand for our services is susceptible to changes in
+ the economic conditions of Hong Kong, see "Risk
+ Factors – Risks Related to Our Business and Industry – Demand for our services is susceptible to changes
+ in the economic conditions of Hong Kong" on page 20.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ A lack of qualified employees would significantly hinder
+ our growth plans and adversely affect our results of operations, see
+ "Risk Factors – Risks Related to Our Business and Industry – A lack of qualified employees would significantly
+ hinder our growth plans and adversely affect our results of operations" on page 21.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We could be held liable for the malpractice of our medical
+ practitioner and the negligence of our staff members and other agents, see
+ "Risk Factors – Risks Related to Our Business and Industry – We could be held liable for the malpractice
+ of our medical practitioner and the negligence of our staff members and other agents" on page 21.
+
+ 
+ 
+
+ 12
+
+ 
+
+ 
+
+ 
+
+Risks
+Related to Doing Business in the PRC (for a more detailed discussion, see "Risk Factors – Risks Related to Doing Business
+in the PRC" beginning on page 24 of this prospectus)
+
+ 
+
+ 
+ 
+ 
+ A downturn in the Hong Kong or global economy, or a
+ change in economic and political policies of China, could materially and adversely affect our business and financial condition, see
+ "Risk Factors – Risks Related to Doing Business in the PRC – A downturn in the Hong Kong or global
+ economy, or a change in economic and political policies of China, could materially and adversely affect our business and financial
+ condition" on page 24.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Changes in the policies, regulations and rules, and
+ the enforcement of laws of Hong Kong government may be implemented quickly with little advance notice and could have a significant
+ impact upon our ability to operate profitably in Hong Kong. The current Hong Kong legal system also embodies uncertainties, which
+ could limit law enforcement availability. Therefore, our assertions and beliefs of the risk imposed by the legal and regulatory system
+ cannot be certain, see "Risk Factors –
+ Risks Related to Doing Business in the PRC – Changes in the policies, regulations and rules, and the enforcement
+ of laws of Hong Kong government may be implemented quickly with little advance notice and could have a significant impact upon our
+ ability to operate profitably in Hong Kong. The current Hong Kong legal system also embodies uncertainties, which could limit law
+ enforcement availability. Therefore, our assertions and beliefs of the risk imposed by the legal and regulatory system cannot be
+ certain" on page 25.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ The PRC government may exercise significant oversight
+ and discretion over the conduct of our business and may intervene in or influence our operations at any time, which could result
+ in a material change in our operations and/or the value of our Class A Ordinary Shares. Changes in the policies, regulations, rule,
+ and the enforcement of laws of the PRC government may also be implemented quickly with little advance notice. Therefore, our assertions
+ and beliefs concerning the risk imposed by the PRC legal and regulatory system cannot be certain, see
+ "Risk Factors – Risks Related to Doing Business in the PRC – The PRC government may exercise significant
+ oversight and discretion over the conduct of our business and may intervene in or influence our operations at any time, which could
+ result in a material change in our operations and/or the value of our Class A Ordinary Shares. Changes in the policies, regulations,
+ rule, and the enforcement of laws of the PRC government may also be implemented quickly with little advance notice. Therefore, our
+ assertions and beliefs concerning the risk imposed by the PRC legal and regulatory system cannot be certain" on page 25.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ To the extent cash or assets in our business is in the
+ PRC or in our Hong Kong subsidiaries, the funds or assets may not be
+ available to fund operations or for other use outside of the PRC due to interventions in or the imposition of restrictions and limitations
+ on our ability or the ability of our Hong Kong subsidiaries by the PRC government to transfer cash or assets, see "Risk
+ Factors – Risks Related to Doing Business in the PRC – To the extent cash or assets in our business is in the PRC or
+ in our Hong Kong subsidiaries, the funds or assets may not be available to fund operations or for other use outside of the PRC due
+ to interventions in or the imposition of restrictions and limitations on our ability or the ability of our Hong Kong subsidiaries
+ by the PRC government to transfer cash or assets." on page 26.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ We conduct substantially all of our operations in Hong
+ Kong, if we should become subject to the recent scrutiny, criticism and negative publicity involving U.S.-listed Chinese companies,
+ we may have to expend significant resources to investigate and/or defend the allegations, which could harm our business operations,
+ this offering and our reputation and could result in a loss of your investment in our Class A Ordinary Shares if such allegations
+ cannot be addressed and resolved favorably, see "Risk
+ Factors – We conduct substantially all of our operations in Hong Kong, if we should become subject to the recent scrutiny,
+ criticism and negative publicity involving U.S.-listed Chinese companies, we may have to expend significant resources to investigate
+ and/or defend the allegations, which could harm our business operations, this offering and our reputation and could result in a loss
+ of your investment in our Class A Ordinary Shares if such allegations cannot be addressed and resolved favorably" on page 26.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The Chinese regulators could also disallow our organizational
+ structure, which would likely result in a material change in our operations and/or a material change in the value of the securities
+ we are registering for sale, including that it could cause the value of such securities to significantly decline or become worthless,
+ see "Risk Factors – Risks Related to Doing Business in the PRC – The Chinese regulators could also disallow
+ our organizational structure, which would likely result in a material change in our operations and/or a material change in the value
+ of the securities we are registering for sale, including that it could cause the value of such securities to significantly decline
+ or become worthless" on page 26.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ There are political risks associated with conducting
+ business in Hong Kong, see "Risk Factors –
+ Risks Related to Doing Business in the PRC – There are political risks associated with conducting business in Hong
+ Kong" on page 26.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ If the PRC government were to impose new regulatory
+ approval requirements for the Company to issue the Class A Ordinary Shares to foreign investors or list on a foreign exchange, such
+ action could significantly limit or completely hinder our ability to offer or continue to offer Class A Ordinary Shares and other
+ securities to investors and cause such securities to significantly decline in value or become worthless, see "Risk Factors
+ – Risks Related to Doing Business in the PRC – If the PRC government were to impose new regulatory approval requirements
+ for the Company to issue the Class A Ordinary Shares to foreign investors or list on a foreign exchange, such action could significantly
+ limit or completely hinder our ability to offer or continue to offer Class A Ordinary Shares and other securities to investors and
+ cause such securities to significantly decline in value or become worthless" on page 33.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ As of the date of this prospectus, we: (i) are not required
+ to obtain permissions from any PRC regulators to operate our business or issue our Class A Ordinary Shares to foreign investors;
+ (ii) are not subject to permission requirements from the CSRC, the Cyberspace Administration of China (the "CAC") or
+ any other entity that is required to approve of our subsidiaries operations; and (iii) have not received or were denied such
+ permissions by any PRC regulators. Given the current PRC regulatory environment, it is uncertain when and whether we will be required
+ to obtain permission from the PRC government to list on U.S. stock exchanges in the future, and even when such permission is obtained,
+ whether it will be denied or rescinded, see "Risk Factors – Risks Related to Doing Business in the PRC –
+ As of the date of this prospectus, we: (i) are not required to obtain permissions from any PRC regulators to operate our business
+ or issue our Class A Ordinary Shares to foreign investors; (ii) are not subject to permission requirements from the CSRC, the Cyberspace
+ Administration of China (the "CAC") or any other entity that is required to approve of our subsidiaries operations;
+ and (iii) have not received or were denied such permissions by any PRC regulators. Given the current PRC regulatory environment,
+ it is uncertain when and whether we will be required to obtain permission from the PRC government to list on U.S. stock exchanges
+ in the future, and even when such permission is obtained, whether it will be denied or rescinded" on page 34.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Any future action by the PRC government to exert more
+ oversight and control over offerings that are conducted overseas and/or foreign investment in Chinese issuers or expanding the categories
+ of industries and companies whose foreign securities offerings are subject to government review could significantly limit or completely
+ hinder our ability to offer or continue to offer securities to investors and cause the value of our securities to significantly decline
+ or the securities to become worthless, see "Risk Factors – Risks Related to Doing Business in the PRC –
+ Any future action by the PRC government to exert more oversight and control over offerings that are conducted overseas and/or foreign
+ investment in Chinese issuers or expanding the categories of industries and companies whose foreign securities offerings are subject
+ to government review could significantly limit or completely hinder our ability to offer or continue to offer securities to investors
+ and cause the value of our securities to significantly decline or the securities to become worthless" on page 35.
+
+ 
+ 
+
+ 13
+
+ 
+
+ 
+
+ 
+
+Risks
+Related to Our Securities and the Offering (for a more detailed discussion, see "Risk Factors – Risks Related to Our Securities
+and the Offering" beginning on page 36 of this prospectus)
+
+ 
+
+ 
+ 
+ 
+ An
+ active trading market for our Class A Ordinary Shares may not be established or, if established, may not continue, see "Risk
+ Factors – Risks Related to Our Securities and the Offering – An active trading market for our Class A Ordinary
+ Shares may not be established or, if established, may not continue" on page 36
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Because
+ we do not expect to pay dividends in the foreseeable future, you must rely on price appreciation of our Class A Ordinary Shares for
+ a return on your investment, see "Risk Factors – Risks Related to Our Securities and the Offering – Because
+ we do not expect to pay dividends in the foreseeable future, you must rely on price appreciation of our Class A Ordinary Shares for
+ a return on your investment" on page 38
+
+ 
+ 
+
+ 
+ 
+ 
+ As
+ an exempted company incorporated in the Cayman Islands, we are permitted to adopt certain home country practices in relation to corporate
+ governance matters that differ significantly from the Nasdaq listing rules and corporate governance standards, see "Risk
+ Factors – Risks Related to Our Securities and the Offering – As an exempted company incorporated in the Cayman
+ Islands, we are permitted to adopt certain home country practices in relation to corporate governance matters that differ significantly
+ from the Nasdaq listing rules and corporate governance standards" on page 39
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ You
+ may have more difficulties protecting your interests than you would as a shareholder of a U.S. corporation, see "Risk Factors
+ – Risks Related to Our Securities and the Offering – You may have more difficulties protecting your interests
+ than you would as a shareholder of a U.S. corporation" on page 40
+
+ 
+
+ 
+
+Implications
+of Being a "Controlled Company"
+
+ 
+
+Public
+companies with securities listed on the Nasdaq Stock Market, must comply with the exchange s continued listing standards to maintain
+their listings. Companies that do not comply with these corporate governance requirements may lose their listing status. Under the Nasdaq
+rules, a "controlled company" is a company with more than 50% of its voting power held by a single person, entity, or group.
+A controlled company is exempt from certain corporate governance requirements of Nasdaq, including:
+
+ 
+
+ 
+ 
+ 
+ the
+ requirement that a majority of the board of directors consist of independent directors;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ requirement that a listed company has a nominating and governance committee that is composed entirely of independent directors with
+ a written charter addressing the committee s purpose and responsibilities;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ requirement that a listed company has a compensation committee that is composed entirely of independent directors with a written
+ charter addressing the committee s purpose and responsibilities; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ requirement for an annual performance evaluation of the nominating and governance committee and compensation committee.
+
+ 
+ 
+
+Controlled
+companies must still comply with Nasdaq s other corporate governance standards. These include having an audit committee and the
+special meetings of independent or non-management directors.
+
+ 
+
+Upon
+the completion of this offering, the outstanding shares of MEDG will consist of 30,333,333 Ordinary Shares, assuming the underwriters
+do not exercise their over-allotment option to purchase additional Ordinary Shares, or 30,833,333 Ordinary Shares, assuming the over-allotment
+option is exercised in full. Immediately after the completion of this offering, our Controlling Shareholder will own 57.86% of our total
+issued and outstanding Ordinary Shares, representing 96.49% of the total voting power, assuming that the underwriters do not exercise
+their over-allotment option, or 56.92% of our total issued and outstanding Ordinary Shares after over-allotment options are fully exercised,
+representing 96.35% of the total voting power, assuming that the over-allotment option is exercised in full. As a result, we will be
+a "controlled company" as defined under Nasdaq Listing Rule 5615 because our Controlling Shareholder will hold more than
+50% of the voting power for the election of directors. Therefore, the Controlling Shareholder of MEDG will be able to exert significant
+control over our management and affairs requiring shareholder approval, including approval of significant corporate transactions. This
+concentration of ownership may not be in the best interests of all of our shareholders. As a "controlled company," we are
+permitted to elect not to comply with certain corporate governance requirements. We do not plan to rely on these exemptions, but we may
+elect to do so after we complete this offering.
+
+ 
+
+ 14
+
+ 
+
+ 
+
+ 
+
+Implications
+of Being an Emerging Growth Company
+
+ 
+
+As
+a company with less than US$1.235 billion in revenue during our last fiscal year, we qualify as an "emerging growth company"
+as defined in the Jumpstart Our Business Startups Act (the "JOBS Act"), enacted in April 2012. An "emerging growth
+company" may take advantage of reduced reporting requirements that are otherwise applicable to larger public companies. In particular,
+as an emerging growth company, we:
+
+ 
+
+ 
+ 
+ 
+ may
+ present only two years of audited financial statements and only two years of related Management s Discussion and Analysis of
+ Financial Condition and Results of Operations, or "MD&A";
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ are
+ not required to provide a detailed narrative disclosure discussing our compensation principles, objectives and elements and analyze
+ how those elements fit with our principles and objectives, which is commonly referred to as "compensation discussion and analysis";
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ are
+ not required to obtain an attestation and report from our auditors on our management s assessment of our internal control over
+ financial reporting pursuant to the Sarbanes-Oxley Act of 2002 ("Sarbanes-Oxley Act");
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ are
+ not required to obtain a non-binding advisory vote from our shareholders on executive compensation or golden parachute arrangements
+ (commonly referred to as the "say-on-pay," "say-on frequency" and "say-on-golden-parachute" votes);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ are
+ exempt from certain executive compensation disclosure provisions requiring a pay-for-performance graph and CEO pay ratio disclosure;
+ and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ are
+ eligible to claim longer phase-in periods for the adoption of new or revised financial accounting standards under 107 of the
+ JOBS Act.
+
+ 
+ 
+
+We
+intend to take advantage of all of these reduced reporting requirements and exemptions, including the longer phase-in periods for the
+adoption of new or revised financial accounting standards under 107 of the JOBS Act. Our election to use the phase-in periods may
+make it difficult to compare our financial statements to those of non-emerging growth companies and other emerging growth companies that
+have opted out of the phase-in periods under 107 of the JOBS Act.
+
+ 
+
+We
+will remain an emerging growth company until the earliest of (i) the last day of the fiscal year during which we have total annual gross
+revenues of at least US$1.235 billion; (ii) the last day of our fiscal year following the fifth anniversary of the completion of this
+offering; (iii) the date on which we have, during the preceding three-year period, issued more than US$1.0 billion in non-convertible
+debt; or (iv) the date on which we are deemed to be a "large accelerated filer" under the Exchange Act, which would occur
+if the market value of our Ordinary Shares that are held by non-affiliates exceeds US$700 million as of the last business day of our
+most recently completed second fiscal quarter. Once we cease to be an emerging growth company, we will not be entitled to the exemptions
+provided in the JOBS Act discussed above.
+
+ 
+
+Going Concern
+
+ 
+
+Our financial statements
+appearing elsewhere in this prospectus have been prepared on a going concern basis, which contemplates the realization of assets and
+the satisfactions of liabilities in the normal course of business. During the six months ended December 31, 2024 and 2023, we generated
+net revenue of US$3,250,577 and US$3,855,925, respectively, and net income of US$981,922 and US$895,606, respectively. During the fiscal
+years ended June 30, 2024 and 2023, we generated net revenue of US$6,111,388 and US$8,022,480, respectively, and net income of US$607,678
+and US$1,900,275, respectively. However, we generated operating cash outflows of US$611,480 and US$1,031,834 for the six months ended
+December 31, 2024 and year ended June 30, 2024, respectively. Our working capital deficits were US$8,313,163 and US$9,029,519 as of December
+31, 2024 and June 30, 2024, respectively. Thus, there exists substantial doubt about our ability to continue as a going concern.
+
+ 
+
+We intend to rely on debt
+and equity financing for working capital until positive cash flow from operations can be achieved. We expect that the proceeds from this
+offering, together with bank borrowings and working capital loans from our controlling shareholder, if necessary, will fund our operations
+through at least 12 months from December 31, 2024. There are no assurances that we will be able to raise capital on terms acceptable
+to us. If we are unable to obtain sufficient amount of additional capital, we may be required to reduce the scope of our development,
+which could harm our business, financial condition and results of operations. The consolidated financial statements contained in this
+prospectus do not include any adjustments that might result from the outcome of these uncertainties. As a result, our independent registered
+public accounting firm included an explanatory paragraph in its report on our financial statements for the fiscal years ended June 30,
+2024 and 2023 with respect to this uncertainty.
+
+ 
+
+ 15
+
+ 
+
+ 
+
+ 
+
+Implications
+of Being a Foreign Private Issuer
+
+ 
+
+We
+are a "foreign private issuer" within the meaning of the rules under the Exchange Act. As such, we are eligible to be
+exempt from certain provisions applicable to United States domestic public companies. For example:
+
+ 
+
+ 
+ 
+ 
+ we
+ are not required to provide as many Exchange Act reports, or as frequently, as a domestic public company;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ for
+ interim reporting, we are permitted to comply solely with our home country requirements, which are less rigorous than the rules that
+ apply to domestic public companies;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ we
+ are not required to provide the same level of disclosure on certain issues, such as executive compensation;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ we
+ are exempt from provisions of Regulation FD aimed at preventing issuers from making selective disclosures of material information;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ we
+ are not required to comply with the sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations
+ in respect of a security registered under the Exchange Act; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ we
+ are not required to comply with Section 16 of the Exchange Act requiring insiders to file public reports of their share ownership
+ and trading activities and establishing insider liability for profits realized from any "short-swing" trading transaction.
+
+ 
+ 
+
+Furthermore,
+Nasdaq Rule 5615(a)(3) provides that a foreign private issuer, such as us, may rely on our home country corporate governance practices
+in lieu of certain of the rules in the Nasdaq Rule 5600 Series and Rule 5250(d), provided that we nevertheless comply with Nasdaq s
+Notification of Noncompliance requirement (Rule 5625), the Voting Rights requirement (Rule 5640) and that we have an audit committee
+that satisfies Rule 5605(c)(3), consisting of committee members that meet the independence requirements of Rule 5605(c)(2)(A)(ii). If
+we rely on our home country corporate governance practices in lieu of certain of the rules of Nasdaq, our shareholders may not have the
+same protections afforded to shareholders of companies that are subject to all of the corporate governance requirements of Nasdaq. If
+we choose to do so, we may utilize these exemptions for as long as we continue to qualify as a foreign private issuer.
+
+ 
+
+Impact
+of COVID-19
+
+ 
+
+In
+March 2020, the World Health Organization recognized the COVID-19 outbreak as a global pandemic. The COVID-19 pandemic and government
+actions implemented to contain further spread of COVID-19 have severely restricted economic activity around the world. The facts pertaining
+to the pandemic and the related governmental and regulatory response are changing day-to-day in many countries. The pandemic disrupted
+logistics in the global trade and reduced consumer sentiment. Our business was also adversely affected for the same reasons. Between
+early 2020 and early 2023, the Hong Kong government imposed a series of social distancing and business closure orders that prohibit certain
+gatherings and shut down non-essential economic activities such as hair salons. As the demand for beauty services is closely correlated
+with the general economic conditions, changes in discretionary income, and market sentiment, our results of operations decreased significantly.
+We responded by halting operation of all our service centers, so that we could reduce our working capital needs, focus our resources
+to serve our customers and improve our cash position.
+
+ 
+
+ 16
+
+ 
+
+ 
+
+ 
+
+In
+addition, due to the instability of global financial markets and other economic and financial challenges brought about by COVID-19, our
+clients, due to prohibition of gathering order, were prevented from visiting our shops. More broadly, the COVID-19 pandemic threatens
+global economies and has caused significant market volatility and declines in general economic activities. This may have severely dampened
+the confidence in beauty and personal care markets and potential clients.
+
+ 
+
+The
+extent to which COVID-19 impacts our business in the future will depend on future developments, which are highly uncertain and cannot
+be predicted, including new information which may emerge concerning the severity of COVID-19, actions to contain COVID-19, and the impact
+of such actions, among others. If the disruptions posed by COVID-19 or other matters of global concern continue for an extended period
+of time, our ability to pursue our business objectives may be materially adversely affected and therefore, the effects on our operations
+and financial results remain uncertain. If economic or market conditions in key global markets deteriorate, it may have a material adverse
+impact on our business and results of operations, and we may experience material adverse effects on our financial positions. In addition,
+our ability to raise equity and debt financing may be adversely impacted by COVID-19 and other events, including increased market volatility,
+decreased market liquidity and third-party financing being unavailable on terms acceptable to us or at all. We will continue to closely
+monitor the situation.
+
+ 
+
+Any
+future impact on our results of operations will depend on, to a large extent, future developments and new information that may emerge
+regarding the duration and severity of the COVID-19 pandemic and the actions taken by government regulators and other entities to contain
+the spread, almost all of which are beyond our control. Given the general slowdown in economic conditions globally, volatility in the
+capital markets as well as the general negative impact of the COVID-19 pandemic on the beauty and personal care services market, we cannot
+assure you that we will be able to maintain the growth rate we have experienced or projected. We will continue to closely monitor the
+situation.
+
+ 
+
+Corporate
+Information
+
+ 
+
+We
+were incorporated in the Cayman Islands on March 13, 2024, for the purpose of being the holding company for the listing on the Nasdaq
+Capital Market. Our registered office in the Cayman Islands is at the office of Ogier Global (Cayman) Limited, 89 Nexus Way, Camana Bay,
+Grand Cayman, KY1-9009, Cayman Islands. Our principal executive office is at Unit 15-16, 22/F., CEO Tower, 77 Wing Hong Street, Cheung
+Sha Wan, Kowloon, Hong Kong. Our telephone number at this location is +852 2388 1121. Our website address is http://www.doctorsconcept.com.
+The information contained on our website does not form part of this prospectus. Our agent for service of process in the United States
+is Cogency Global Inc., 122 E. 42nd Street, 18th Floor, New York, New York 10168.
+
+ 
+
+Because
+we are incorporated under the laws of the Cayman Islands, you may encounter difficulty protecting your interests as a shareholder, and
+your ability to protect your rights through the U.S. federal court system may be limited. Please refer to the sections entitled "Risk
+Factors – Risks Related to our Securities and the Offering" on pages 14 and 36 of this prospectus, and Enforceability
+of Civil Liabilities on page 46 of this prospectus for more information.
+
+ 
+
+ 17
+
+ 
+
+ 
+
+ 
+
+THE
+OFFERING
+
+ 
+
+ 
+ Securities
+ being offered:
+ 
+ US$15,000,000,
+ or 3,333,333 Class A Ordinary Shares, US$0.0001 par value.
+
+ 
+ 
+ 
+ 
+
+ 
+ Securities
+ being offered by the Selling Shareholders:
+ 
+ 4,272,222
+ Class A Ordinary Shares, US$0.0001 par value.
+
+ 
+ 
+ 
+ 
+
+ 
+ Initial
+ public offering price:
+ 
+ The
+ initial offering price is US$4.50 per Ordinary Share. 
+
+ 
+ 
+ 
+ 
+
+ 
+ Ordinary
+ Shares outstanding prior to completion of this offering:
+ 
+ 27,000,000
+ Ordinary Shares, consist of 9,450,000 Class A Ordinary Shares and 17,550,000 Class B Ordinary Shares.
+
+ 
+ 
+ 
+ 
+
+ 
+ Ordinary
+ Shares outstanding immediately after this offering:
+ 
+ 30,333,333,
+consist of 12,783,333 Class A Ordinary Shares and 17,550,000 Class B Ordinary Shares. (30,833,333, consist of 13,283,333 Class A Ordinary
+Shares and 17,550,000 Class B Ordinary Shares, if the underwriters exercise the over-allotment option in full).
+
+ 
+ 
+ 
+ 
+
+ 
+ Gross
+ Proceeds 
+ 
+ We
+ expect that it will receive gross proceeds of US$15,000,000 from this offering or US$17,249,999 if the underwriters exercise
+ their over-allotment option in full, at the initial offering price of US$4.5 per share.
+
+ 
+ 
+ 
+ 
+
+ 
+ Use
+ of Proceeds
+ 
+ We
+ estimate that we will receive net proceeds from this offering of up to US$12,600,000, based on the public offering price of
+ US$4.5 per share, after deducting underwriting fees and commissions, a non-accountable expense allowance and estimated offering expenses.
+ We currently intend to use the net proceeds from this offering as follows: (i) approximately 5% to set up our research and development
+ capacity; (ii) approximately 25% to penetrate and further expand into new and existing geographical markets; (iii) approximately
+ 65% for general working capital and other general corporate purposes; and (iv) approximately 5% for advisory fee payment. See Use
+ of Proceeds on page 48 of this prospectus.
+
+ 
+ 
+ 
+ 
+
+ 
+ Risk
+ Factors
+ 
+ Investing
+ in our Class A Ordinary Shares involves a high degree of risk and purchasers of our Class A Ordinary Shares may lose part or all
+ of their investment. See "Risk Factors" for a discussion of factors you should carefully consider before deciding
+ to invest in our Class A Ordinary Shares beginning on page 20.
+
+ 
+ 
+ 
+ 
+
+ 
+ Lock-Up
+ 
+ Each
+ of our directors, executive officers and shareholders owning more than 1% of our Ordinary
+ Shares have agreed, subject to certain exceptions, including the resale of a portion of our
+ Class A Ordinary Shares by the Selling Shareholders under the Resale Prospectus (whom have
+ agreed not to sell the Resale Shares for a period of 21 days from the completion of the initial
+ public offering), for a period of 180 days after the date of this prospectus, not to, except
+ in connection with this offering, offer, sell, or otherwise transfer or dispose of, directly
+ or indirectly, any Ordinary Shares or any securities convertible into or exercisable or exchangeable
+ for Class A Ordinary Shares of the Company. See "Shares Eligible for Future Sale"
+ and "Underwriting—Lock-Up Agreements".
+
+ 
+
+ In
+ addition, the Company has agreed not to file or cause to be filed any registration statement with the SEC relating to the offering
+ of any Ordinary Shares of the Company or any securities convertible into or exercisable or exchangeable for Class A Ordinary Shares
+ of the Company for a period of 365 days after the date of this prospectus other than post-effective amendments to this prospectus
+ and the Resale Prospectus.
+
+ 
+
+ 18
+
+ 
+
+ 
+
+ 
+
+ 
+ Dividend
+ Policy
+ 
+ We
+ do not intend to pay any dividends on our Ordinary Shares for the foreseeable future. Instead, we anticipate that all of our earnings,
+ if any, will be used for the operation and growth of our business. See "Dividends and Dividend Policy" for more
+ information.
+
+ 
+ 
+ 
+ 
+
+ 
+ Over-Allotment
+ Option
+ 
+ We
+have granted to the underwriters an option, exercisable for 45 days from the date of this prospectus, to purchase up to an aggregate
+of 500,000 Ordinary Shares at the initial public offering price, less underwriting discounts, and commissions, solely for the
+purpose of covering over-allotments. See Underwriting on page 133 of this prospectus. 
+
+ 
+ 
+ 
+ 
+
+ 
+ Underwriters 
+ Warrants 
+
+ 
+ We
+ have agreed to issue, on the closing date of this offering, warrants, or the underwriters 
+ warrants, to the representatives of the underwriters in an amount equal to 3.33% of the number
+ of Class A Ordinary Shares issued in this offering, not including Class A Ordinary Shares
+ that may be purchased from us upon the exercise of the over-allotment option by the underwriters,
+ at a per share exercise price equal to 120% of the per share offering price of the Class
+ A Ordinary Shares offered hereby. The underwriters warrants are exercisable for a
+ period of five years expiring on the fifth anniversary of from the effective date
+ of this registration statement. 
+
+ 
+ 
+ 
+ 
+
+ 
+ Listing
+ 
+ Application
+ has been made for the listing of the Class A Ordinary Shares on the Nasdaq Capital Market.
+
+ 
+ 
+ 
+ 
+
+ 
+ Proposed
+ Trading Symbol
+ 
+ We
+ have applied to list our Ordinary Shares on the Nasdaq Capital Market under the symbol "MEDG". We believe that upon completion
+ of this offering, we will meet the standards for listing on Nasdaq, however, we cannot guarantee that we will be successful in listing
+ our Class A Ordinary Shares on Nasdaq. We will not consummate this offering unless our Class A Ordinary Shares is approved for listed
+ on Nasdaq.
+
+ 
+ 
+ 
+ 
+
+ 
+ Transfer
+ Agent
+ 
+ VStock
+ Transfer.
+
+ 
+ 
+ 
+ 
+
+ 
+ Payment
+ and Settlement
+ 
+ The
+ underwriters expect to deliver the Ordinary Shares against payment therefor through the facilities of the Depository Trust Company
+ on , 2025.
+
+ 
+ 
+
+SUMMARY
+FINANCIAL DATA
+
+ 
+
+You
+should read the following summary financial data together with our financial statements and the related notes appearing at the end of
+this prospectus, "Selected Consolidated Financial and Other Data", "Capitalization" and "Management s
+Discussion and Analysis of Financial Condition and Results of Operations". We have derived the financial data for the six months
+ended December 31, 2024 and 2023, and the years ended June 30, 2024 and 2023 from our consolidated financial statements included in this
+prospectus.
+
+ 
+
+Results
+of Operations Data:
+
+ 
+
+ 
+ 
+ For the six months ended December
+ 31, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ USD 
+ USD 
+
+ 
+ 
+ (Unaudited) 
+ (Unaudited) 
+
+ 
+ Revenues 
+ $3,250,577 
+ $3,855,925 
+
+ 
+ Net income 
+ $981,922 
+ $895,606 
+
+ 
+ Net income per share attributable to Class A ordinary shareholders 
+ $0.04 
+ $0.03 
+
+ 
+ Net income per share attributable to Class B ordinary shareholders 
+ $0.04 
+ $0.03 
+
+ 
+ Weighted average number of Class A Ordinary Shares outstanding (shares) 
+ 9,450,000 
+ 9,450,000 
+
+ 
+ Weighted average number of Class B Ordinary Shares outstanding (shares) 
+ 17,550,000 
+ 17,550,000 
+
+ 
+
+ 
+
+ 
+ 
+ For the years ended June 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ USD 
+ USD 
+
+ 
+ Revenues 
+ $6,111,388 
+ $8,022,480 
+
+ 
+ Net income 
+ $607,678 
+ $1,900,275 
+
+ 
+ Net income per share attributable to Class A ordinary shareholders 
+ $0.02 
+ $0.07 
+
+ 
+ Net income per share attributable to Class B ordinary shareholders 
+ $0.02 
+ $0.07 
+
+ 
+ Weighted average number of Class A Ordinary Shares outstanding (shares) 
+ 9,450,000 
+ 9,450,000 
+
+ 
+ Weighted average number of Class B Ordinary Shares outstanding (shares) 
+ 17,550,000 
+ 17,550,000 
+
+ 
+
+ 
+
+Balance
+Sheet Data:
+
+ 
+
+ 
+ 
+ As of December 31, 
+ As of June 30, 
+
+ 
+ 
+ 2024 
+ 2024 
+ 2023 
+
+ 
+ 
+ USD 
+ USD 
+ USD 
+
+ 
+ 
+ (Unaudited) 
+ 
+ 
+
+ 
+ Cash 
+ $3,875 
+ $85,798 
+ $54,932 
+
+ 
+ Working capital 
+ (8,313,163) 
+ (9,029,518) 
+ (11,377,574)
+
+ 
+ Total assets 
+ 2,467,317 
+ 1,833,091 
+ 3,024,589 
+
+ 
+ Total liabilities 
+ 10,536,565 
+ 10,839,601 
+ 13,638,429 
+
+ 
+ Total shareholders deficit 
+ (8,069,248) 
+ (9,006,510) 
+ (10,613,840)
+
+ 
+
+ 
+
+ 19
+
+ 
+
+ 
+
+ 
+
+RISK
+FACTORS
+
+ 
+
+Investing
+in our Class A Ordinary Shares is highly speculative and involves a significant degree of risk. You should carefully consider the following
+risks, as well as other information contained in this prospectus, before making an investment in the Company. The risks discussed below
+could materially and adversely affect our business, prospects, financial condition, results of operations, cash flows, ability to pay
+dividends and the trading price of our Class A Ordinary Shares. Additional risks and uncertainties not currently known to us or that
+we currently deem to be immaterial may also materially and adversely affect our business, prospects, financial condition, results of
+operations, cash flows and ability to pay dividends, and you may lose all or part of your investment.
+
+ 
+
+Risks
+Related to Our Business and Industry
+
+ 
+
+Our
+reputation in the industry, which we do not have full control, is critical to our success.
+
+ 
+
+Our
+success depends to a significant extent on our reputation as a quality and reliable medical aesthetic services provider in Hong Kong.
+Any negative publicity in relation to our services, business practices, medical practitioners or beauty professionals, may, regardless
+of the merits, damage our reputation in the medical aesthetic services industry.
+
+ 
+
+Our
+customers may have high expectations on the magnitude of improvement in their physical appearance resulting from the treatments. The
+results of medical aesthetics procedures, however, vary on a case-by-case basis, as the outcomes are affected by a multitude of factors,
+such as skin condition, health condition, adherence to our instructions after treatment, and other factors beyond our control. Undesirable
+or unexpected outcomes, such as complications and injuries, may occur. Such undesirable or unexpected outcomes may result in negative
+sentiments, requests for refunds, or complaints, claims or legal actions against us or our registered medical practitioners.
+
+ 
+
+We
+operate in a highly competitive industry.
+
+ 
+
+The
+medical aesthetic services industry is characterized by rapidly changing market trends. There are regular technological upgrades, advancements
+in treatment procedures, and new and more effective injectables. We are in constant competition with other medical aesthetic services
+providers in aspects such as quality, range and pricing of services, comprehensiveness and diversity of treatment devices as well as
+pricing. Some of our competitors may be able to foresee the upcoming market trends more accurately or may be more responsive to new technologies
+or changing customer preferences. They may also have more financial and other resources than we do. Their stronger bargaining power and
+economies of scale may give them the option of undercutting our pricing structure. If we are unable to offer services responsive to market
+demand on competitive terms, our customers may choose to find alternative service providers, which may have a material adverse effect
+on our business and results of operation.
+
+ 
+
+Demand
+for our services is susceptible to changes in the economic conditions of Hong Kong.
+
+ 
+
+As
+all of our operations are in Hong Kong, unless and until we are successful in establishing a significant presence in other Asian countries,
+we will remain susceptible to the economic conditions in mainland China and Hong Kong. Beauty and personal care, and medical cosmetology
+services are discretionary items. Demand for our services therefore fluctuates with changing general economic conditions, discretionary
+spending power, consumer sentiment, interest rates, consumer credit market, levels of unemployment, and taxation policies. Unfavorable
+economic conditions may cause consumers to delay or reduce their purchases of our services. Our sensitivity to economic cycles and any
+related fluctuation in consumer demand for our services may have an adverse effect on our results of operations.
+
+ 
+
+The
+current geopolitical tensions between the U.S. and China, including those arising from the trade war, may dampen economic growth in China,
+including Hong Kong. Future changes in the relationship between the two countries are subject to numerous political developments in the
+world, including U.S. presidential elections and the Russia-Ukraine war. Any escalations in the geopolitical tension by either the U.S.
+or China may cause global economic turmoil and potentially have a negative impact on our business, financial condition and results of
+operations. There is no assurance as to whether such actions will occur or the form that they may take.
+
+ 
+
+ 20
+
+ 
+
+ 
+
+ 
+
+A
+lack of qualified employees would significantly hinder our growth plans and adversely affect our results of operations.
+
+ 
+
+One
+of our business strategies is to grow our network of service centers. As we grow, our ability to increase productivity and profitability
+will be limited by our ability to employ, train, and retain skilled personnel. There is no assurance that we will be able to maintain
+an adequate skilled labor force that is necessary for us to operate efficiently, that our labor expenses will not disproportionately
+increase as a result of a shortage in the supply of skilled personnel or that we will not have to curtail our planned internal growth
+as a result of labor shortages.
+
+ 
+
+In
+recent years, the lack of availability of beauty and personal care professionals and medical practitioners experienced in medical aesthetic
+services has been a significant operating issue in certain local and regional markets. If the demand exceeds the supply of available
+and qualified personnel, we and our competitors may be forced to offer higher compensation and other benefits to attract and retain them
+or rely on temporary personnel. If we are unable to attract, train and retain qualified personnel, we may be unable to provide our services.
+If we elect to use temporary staff, the quality of our services may decline. Both would result in losing of customers and damaging brand
+and reputation, which could have a material adverse effect on our business, financial condition and results of operations.
+
+ 
+
+We
+could be held liable for the malpractice of our medical practitioner and the negligence of our staff members and other agents.
+
+ 
+
+Our
+medical aesthetic services are rendered in partnership with Dr. Pang Sai Yau ("Dr. Pang Sai Yau" or "Dr. Pang"),
+and he is currently the sole medical practitioner in our business. We rely on him and other medical practitioners whom we will partner
+with or hire in the future to make proper decisions regarding the services that our clients may require. Any incorrect decisions on the
+part of our registered medical practitioners may result in undesirable or unexpected outcomes, including complications and injuries.
+Complaints and legal proceedings may be brought by dissatisfied customers against the relevant registered medical practitioner as well
+as other relevant staff members. As the relevant services are provided at our service centers, if there are claims for professional misconduct
+or negligence, we are likely to be named as one of the defendants. We may be found liable, as principal or business operator, for the
+acts or omissions of our registered medical practitioner and other staff members.
+
+ 
+
+Complaints
+and legal proceedings against us will have negative effect on us on several fronts. We may need to spend substantial time and resources
+to deal with the proceedings. In addition, we may be ordered to pay monetary damages and make other compensation to the complainant.
+
+ 
+
+Under
+the partnership agreement between the Company and Dr. Pang Sai Yau, its sole full-time medical partner and consultant, Dr. Pang will
+indemnify the Company against losses arising from the procedures performed by him on a customer if he is found negligent. This indemnification
+undertaking is of limited value to us. The losses may exceed the dollar cap, or the incident may fall outside the scope of the medical
+malpractice insurance that he is required to maintain with his professional body, and the medical practitioner may not have the financial
+means to fulfil his indemnification undertaking.
+
+ 
+
+Insurers
+are currently reluctant to provide comprehensive/malpractice insurance for medical cosmetology procedures; therefore, in the event of
+any such actual or potential incidents, payments made by us in connection with the defense and settlement of the complaints may not be
+partially or fully recoverable, even with our medical partner s indemnification. Our existing insurance policies do not cover all
+of our liabilities under such situations.
+
+ 
+
+Regulations
+on the medical aesthetic services industry in Hong Kong may become increasingly stringent.
+
+ 
+
+All
+of our operations are in Hong Kong. We are subject to a broad range of regulatory measures of the Hong Kong government, including regulations
+relating to medical services, competition, intellectual properties, and consumer rights. We are also subject to laws, regulations and
+policies relating to the protection of the environment and to workplace health and safety, such as measures to control toxic substances
+and hazardous substances (medicines), and to the implementation of safety measures to protect the health of staff members and customers.
+Changes to current laws, regulations or policies or the imposition of new laws, regulations, and policies in the medical aesthetic services
+industry could impose new restrictions or prohibitions on the current practices. We may incur significant costs and expenses and need
+to budget additional resources to comply with new requirements, which may have a material and adverse effect on our business, financial
+condition, results of operations and prospects.
+
+ 
+
+ 21
+
+ 
+
+ 
+
+ 
+
+Our
+auditors have expressed substantial doubt about our ability to continue as a going concern.
+
+ 
+
+We
+generated net profit of US$0.6 million for the year ended June 30, 2024 and a net profit of US$1.9 million for the year
+ended June 30, 2023, we believe this is a temporary downturn because of migration wave of our target customer group after COVID-19 and
+some customers were attracted by low-priced normal beauty services in mainland China. However, we had cash outflows for the years of
+2024 and 2023. The operating cash outflow and other factors resulted in the report of our independent registered public accounting firm
+that accompanies our unaudited consolidated financial statements to contain a going concern explanatory paragraph in which such firm
+stated that there is substantial doubt about our ability to continue as a going concern. Our consolidated financial statements contained
+in this prospectus do not include any adjustments that might result if we are unable to continue as a going concern.
+There is no assurance as to our future financial condition or results of operations, especially if the Hong Kong economy continues to
+be weak or another pandemic occurs. If we are unable to continue as a going concern, holders of our securities might lose their entire
+investment.
+
+ 
+
+Historically,
+we have financed our working capital needs through cash from operations, bank borrowings and shareholder loans. Our inability to achieve
+profitability from our current operating plans or to raise capital to cover any potential shortfall would have a material adverse effect
+on our ability to meet our obligations as they become due. If we are not able to secure additional funding if and when needed, we would
+be forced to curtail our operations or take other action in order to continue to operate. If we are unable to meet our obligations and
+are forced to curtail or cease our business operations, you could suffer a complete loss of any investment you make in our securities.
+
+ 
+
+We
+may not have the resources to develop innovative services in a timely manner to meet changing customer preferences.
+
+ 
+
+Our
+long-term success in the competitive medical aesthetic services industry depends on our ability to develop and commercialize a continuing
+stream of innovative packages of new services that meet the changing customer preferences and take advantage of the opportunities sooner
+than or matching our competitors. We face the risk that our competitors will introduce innovative new services that compete with our
+services. There are numerous uncertainties inherent in successfully developing and commercializing new services on a continuing basis
+and new service launches may not deliver expected growth in sales or operating income. If we are unable to develop and introduce a continuing
+stream of competitive new services, it may have an adverse effect on our business, financial condition and results of operations.
+
+ 
+
+We
+maintain limited control over the quality of our beauty equipment and treatment devices.
+
+ 
+
+There
+is no assurance that the beauty equipment and treatment devices we procure from our suppliers during the course of our business operations
+are safe, free of defects or meet the relevant quality standards. In the event of quality issues, we could be subject to complaints and
+claims by our customers. We may also need to find alternative suppliers and suitable replacement products, which may result in delays
+in the provision of our services. If we are unable to find alternative suppliers or suitable replacement products in a timely manner,
+our business operations may be disrupted.
+
+ 
+
+Serious
+side effects of medical aesthetics procedures, while statistically insignificant, may occur without the fault of any party.
+
+ 
+
+Medical
+procedures are never risk free. There is no assurance that medical incidents resulting in allergic reaction, undesirable or unexpected
+outcome, injury or death will not occur in the course of our business operations in the future. As procedures and/or medication may have
+varying effects on different persons based on their medical conditions, and customers may have subjective views on the level of satisfaction
+of services provided, it is plausible for customers to become agitated and possibly litigious when desired results are not achieved or
+if they suffer certain side-effects or injuries. If such incidents occur, we may be subject to legal proceedings, substantial liabilities
+and negative media coverage, and our reputation and prospects would be damaged, they could adversely impact our business, financial condition
+and results of operations.
+
+ 
+
+ 22
+
+ 
+
+ 
+
+ 
+
+Our
+services may be tainted by unfavorable public perception of the overall medical aesthetic services industry.
+
+ 
+
+Our
+existing and potential customers are generally cautious about the inherent risks in medical aesthetic treatments, and are particularly
+sensitive to any negative comments, reports or allegations against any medical aesthetic services providers or in relation to the safety
+or effectiveness of any particular treatment method. From time to time, there are negative news and media reports on the health risks
+relating to medical aesthetic treatments as well as accidents relating to the medical aesthetic services industry. Any allegations, complaints,
+or negative news or media reports on any accidents, instances of medical malpractice or professional negligence, unfair selling practices,
+or quality of services relating to the medical aesthetic services industry; or health risks relating to medical aesthetic treatments
+may, regardless of merit, lead to a deterioration in market confidence in medical aesthetic services and a reduction in the overall demand
+for such services. While such allegations, complaints or negative news or media reports may be unrelated to us, the demand for our medical
+aesthetic services may decline as a result of weakened customer confidence, which may materially and adversely affect our business, financial
+condition, results of operations and prospects.
+
+ 
+
+Our
+business has been materially and adversely affected by the COVID-19 pandemic.
+
+ 
+
+The
+global pandemic outbreak of COVID-19 announced by the World Health Organization in early 2020 has significantly disrupted our business.
+We had to make a business decision to close down 3 service centers during the year ended June 30, 2022. The reduction in the size of
+our network has adversely affected our business. Another pandemic of this scale could occur. That pandemic could be more deadly, require
+more stringent regulatory measures being taken, or more contagious. If we cannot find a solution to control it within a short period
+of time, our business, financial condition, results of operations and prospects may be materially and adversely affected.
+
+ 
+
+We
+rely on our management team and employees.
+
+ 
+
+Our
+experienced executive directors and senior management team are one of the key factors contributing to the success of our business. Their
+extensive experience and knowledge of the medical aesthetic services industry help formulate and implement business strategies and foster
+growth of our business. Particularly, we rely on our executive director, Mr. Ng Hon Kin, in the overall management, strategic planning
+and development and daily operation of our business. We also rely on Dr. Pang Sai Yau, a Hong Kong registered medical practitioner, as
+our medical partner and consultant. The loss of services of any of these individuals without timely and suitable replacement may cause
+disruption of our business and adversely affect our prospects.
+
+ 
+
+Our
+growth strategy may not be successful.
+
+ 
+
+As
+part of our business strategies, we have developed plans to expand our operations by expanding our network and establishing our presence
+outside Hong Kong. There is no assurance that our expansion plans will be commercially successful or that the actual outcome will match
+our expectations. The success and viability of our expansion plans are dependent upon our ability to find suitable personnel, develop
+new business strategies and attract sufficient customers. It may require substantial capital expenditure and additional financial resources
+and commitments. There is no assurance that we can achieve the expected results, such as revenue increase, higher gross margin, greater
+operational efficiency. There is also no assurance that we will be able to obtain financing on terms that are favorable, if at all. If
+the results or outcome of our future plans do not meet our expectations, we may not be able to recover our investment costs, and our
+business, financial condition, results of operations and prospects may be adversely affected.
+
+ 
+
+We
+may fail to protect our trade secret and know-how or pursue infringement actions on our other intellectual properties.
+
+ 
+
+Despite
+our efforts to protect our proprietary rights, unauthorized parties may attempt to copy or otherwise obtain and use our intellectual
+properties. Monitoring unauthorized use of our intellectual properties is difficult and costly, and we cannot be certain that the steps
+we have taken will prevent misappropriation of our intellectual properties. From time to time, we may have to resort to litigation to
+enforce our intellectual property rights, which could result in substantial costs and diversion of our resources.
+
+ 
+
+ 23
+
+ 
+
+ 
+
+ 
+
+In
+addition, third parties may initiate legal proceedings against us alleging the infringement of their proprietary rights or declaring
+their non-infringement of our intellectual property rights. In the event of a successful claim of infringement against us and our failure
+or inability to develop non-infringing technology or license the infringed or similar technology on a timely basis, our business could
+be harmed. Moreover, even if we are able to license the infringed or similar technology, license fees could be substantial and may adversely
+affect our results of operations.
+
+ 
+
+Our
+system of internal control over financial reporting may have material weaknesses.
+
+ 
+
+Prior
+to the initial public offering of the Company, the Company has been a private company with limited accounting personnel and other resources
+with which it addresses its internal control over financial reporting. The Company therefore does not have sufficient competent financial
+reporting and accounting personnel with appropriate understanding of the U.S. GAAP to design and implement formal period-end financial
+reporting controls and procedures to address complex U.S. GAAP technical accounting issues, and to prepare and review the consolidated
+financial statements and related disclosures in accordance with U.S. GAAP and financial reporting requirements set forth by the SEC.
+The Company believes that this could constitute a material weakness in its internal control. As defined in the standards established
+by the PCAOB, a "material weakness" is a deficiency, or combination of deficiencies, in internal control over financial reporting,
+such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented
+or detected on a timely basis.
+
+ 
+
+The
+Company is not currently required to maintain an effective system of internal controls. The Company will not be required to comply with
+the internal control requirements of the Sarbanes-Oxley Act until it is required to file an annual report pursuant to section 13(a) or
+15(d) of the Exchange Act for a prior fiscal year. Further, as an emerging growth company, the Company is exempted from the auditor attestation
+requirement under Section 404 of the Sarbanes-Oxley Act in the assessment of the emerging growth company s internal control over
+financial reporting.
+
+ 
+
+Neither
+the Company s management nor its independent registered public accounting firm has performed an assessment of the effectiveness
+of our internal control over financial reporting.
+
+ 
+
+To
+strengthen the Company s system of internal control, the Company is looking for additional qualified financial and accounting personnel
+with working experience with U.S. GAAP and SEC reporting requirements. The Company is currently in the process of establishing clear
+rules and responsibilities for accounting and financial reporting staff to address complex accounting and financial reporting issues.
+
+ 
+
+We
+heavily rely on internal designed database system, namely CARE. If we fail to timely back up our database and to maintain effective cyber
+security, our financial results may be adversely affected.
+
+ 
+
+We
+have internally designed and developed our own invoicing and service databases application, namely CARE. We have adopted the CARE system
+for about seven years, and we are continuously improving the functions, analytics and financial related reports of the CARE system. We
+have regularly backed up our database. However, we have not finished cyber secured cloud or remote backup procedure. We may suffer from
+clerical errors during information input, although we have established dual checking and review mechanisms. In order to patch any possible
+deficiency, we have to parallelly keep physical evidence for delivery of obligations.
+
+ 
+
+If
+we fail to timely back up our database and maintain effective cyber security, our operations may be adversely affected and, as a result,
+our financial condition and results of operations may be adversely affected.
+
+ 
+
+Risks
+Related to Doing Business in the PRC
+
+ 
+
+A
+downturn in the Hong Kong or global economy, or a change in economic and political policies of China, could materially and adversely
+affect our business and financial condition.
+
+ 
+
+Our
+business, financial condition, results of operations and prospects may be influenced to a significant extent by political, economic,
+and social conditions in Hong Kong generally.
+
+ 
+
+Economic
+conditions in Hong Kong and China are sensitive to global economic conditions. Any prolonged slowdown in the global or Chinese economy
+may affect our current customers and potential customers and have a negative impact on our business, results of operations and financial
+condition. Additionally, continued turbulence in the international markets may adversely affect our ability to access the capital markets
+to meet liquidity needs.
+
+ 
+
+ 24
+
+ 
+
+ 
+
+ 
+
+Changes
+in the policies, regulations and rules, and the enforcement of laws of Hong Kong government may be implemented quickly with little advance
+notice and could have a significant impact upon our ability to operate profitably in Hong Kong. The current Hong Kong legal system also
+embodies uncertainties, which could limit law enforcement availability. Therefore, our assertions and beliefs of the risk imposed by
+the legal and regulatory system cannot be certain.
+
+ 
+
+We
+are subject to Hong Kong laws and regulations and PRC laws and regulations generally do not apply to us. However, the boundaries between
+the two jurisdictions may change in the future, and the interpretation and enforcement thereof involve uncertainties. For instance, we
+may have to resort to administrative and court proceedings to enforce the legal protections to which we are entitled to by law or contract.
+Since PRC administrative authorities have significant discretion in interpreting statutory and contractual terms, it may be difficult
+to evaluate the outcome of administrative court proceedings and the level of law enforcement that we would receive in more developed
+legal systems. Such uncertainties, including our inability to enforce our contracts, could affect our business and operations. In addition,
+confidentiality protections in China may not be as effective as in the United States or other countries. Accordingly, we cannot predict
+the effect of future developments in the PRC legal system, particularly with regard to our business, including the promulgation of new
+laws. This may include changes to existing laws or the interpretation or enforcement thereof, or the pre-emption of local regulations
+by national laws. These uncertainties could limit the availability of law enforcement. If we cannot comply with the changed policies,
+regulations and rules, our operations will be adversely affected.
+
+ 
+
+The
+PRC government may exercise significant oversight and discretion over the conduct of our business and may intervene in or influence our
+operations at any time, which could result in a material change in our operations and/or the value of our Class A Ordinary Shares. Changes
+in the policies, regulations, rule, and the enforcement of laws of the PRC government may also be implemented quickly with little advance
+notice. Therefore, our assertions and beliefs concerning the risk imposed by the PRC legal and regulatory system cannot be certain.
+
+ 
+
+The
+Company is a holding company, and we conduct our operation through our subsidiaries in Hong Kong. The PRC government may choose to exercise
+significant oversight and discretion, and the regulations to which we are subject may change rapidly and with little notice to them or
+our shareholders. As a result, the application, interpretation and enforcement of new and existing laws and regulations in China are
+often uncertain. In addition, these laws and regulations may be interpreted and applied inconsistently by different agencies or regulators,
+and inconsistently with our current policies and practices. New laws, regulations and other government directives in China may also be
+costly to comply with, and such compliance or any associated inquiries or investigations or any other government actions may:
+
+ 
+
+ 
+ 
+ 
+ delay
+ or impede our development;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ result
+ in negative publicity or increase in our operating costs;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ require
+ significant management time and attention; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ subject
+ us to remedies, administrative penalties and even criminal liabilities that may harm our business, including fines assessed for our
+ current or historical operations, or demands or orders that we need to modify or even cease our business practices.
+
+ 
+ 
+
+We
+are aware that, recently, the PRC government initiated a series of regulatory actions and statements to regulate business operations
+in certain areas in China with little advance notice, including cracking down on illegal activities in the securities market, enhancing
+supervision over Chinese companies listed overseas using a VIE structure, adopting new measures to extend the scope of cybersecurity
+reviews and expanding the efforts in anti-monopoly enforcement. These regulatory actions and statements emphasize the need to strengthen
+the administration over illegal securities activities and the supervision of Chinese companies seeking overseas listings. Additionally,
+companies are required to undergo a cybersecurity review if they hold large amounts of data related to issues of national security, economic
+development, or public interest before carrying out mergers, restructuring or splits that affect or may affect national security. These
+statements were recently issued, and their official guidance and interpretation remain unclear at this time. While we believe that our
+operations are not currently being affected, we may be subject to additional and stricter compliance requirements in the near term. Compliance
+with new regulatory requirements or any future implementation rules may present a range of new challenges which may create uncertainties
+and increase our cost of operations.
+
+ 
+
+ 25
+
+ 
+
+ 
+
+ 
+
+The
+PRC government may intervene or influence our operations at any time and may exert more control over offerings conducted overseas and
+foreign investment in Chinese issuers, which may result in a material change in our operations and/or the value of our Class A Ordinary
+Shares. Any legal or regulatory changes that restrict or otherwise unfavorably impact our ability to conduct our business could decrease
+demand for our services, reduce revenues, increase costs, require us to obtain more licenses, permits, approvals or certificates, or
+subject us to additional liabilities. To the extent that any new or more stringent measures are implemented, our business, financial
+condition and results of operations could be adversely affected, and the value of our Ordinary Shares could decrease or become worthless.
+
+ 
+
+To the extent cash or assets in our business
+is in the PRC or in our Hong Kong subsidiaries, the funds or assets may not be available to fund operations or for other use outside
+of the PRC due to interventions in or the imposition of restrictions and limitations on our ability or the ability of our Hong Kong subsidiaries
+by the PRC government to transfer cash or assets.
+
+ 
+
+As of the date of this
+prospectus, no cash flows has occurred between the Company and our subsidiaries. However, in the future, we may depend upon dividends
+and other distributions on equity paid by our subsidiaries for our cash and financing requirements. All of our business and assets are
+located in Hong Kong. The Hong Kong government does not impose foreign exchange control. The PRC government, however, imposes controls
+on the convertibility of the Renminbi into foreign currencies and, in certain cases, the remittance of currency out of China. Shortages
+in availability of foreign currency may then restrict the ability of our subsidiaries to remit sufficient foreign currency to our offshore
+entity for our offshore entity to pay dividends or make other payments or otherwise to satisfy our foreign-currency-denominated obligations.
+Therefore, to the extent cash or assets in our business is in the PRC or in our subsidiaries, the funds or assets may not be available
+to fund operations or for other use outside of the PRC due to interventions in or the imposition of restrictions and limitations on our
+ability or the ability of our subsidiaries by the PRC government to transfer cash or assets.
+
+ 
+
+The PRC government may
+continue to strengthen its capital controls, and more restrictions and substantial vetting processes may be put forward by the State
+Administration of Foreign Exchange of the PRC for cross-border transactions. Any limitation on the ability of our subsidiaries to pay
+dividends or make other kinds of payments to us could materially and adversely limit our ability to grow, make investments or acquisitions
+that could be beneficial to our business, pay dividends or otherwise fund and conduct our business.
+
+ 
+
+We
+conduct substantially all of our operations in Hong Kong, if we should become subject to the recent scrutiny, criticism and negative
+publicity involving U.S.-listed Chinese companies, we may have to expend significant resources to investigate and/or defend the allegations,
+which could harm our business operations, this offering and our reputation and could result in a loss of your investment in our Class
+A Ordinary Shares if such allegations cannot be addressed and resolved favorably.
+
+ 
+
+During
+the last several years, U.S. listed public companies that have substantially all of their operations in China have been the subject of
+intense scrutiny by investors, financial commentators and regulatory agencies. Much of the scrutiny has centered on financial and accounting
+irregularities and mistakes, lack of effective internal controls over financial reporting and, in many cases, allegations of fraud. The
+PRC government may also exercise significant oversight and discretion over the conduct of our business and may intervene or influence
+our operations at any time, which could result in a material change in our operations and/or the value of our Class A Ordinary Shares.
+Moreover, as a result of this scrutiny, the publicly traded stocks of many U.S.-listed Chinese companies that have been the subject of
+such scrutiny has sharply decreased in value. Many of these companies are now subject to shareholder lawsuits and/or SEC enforcement
+actions that are conducting internal and/or external investigations into the allegations.
+
+ 
+
+We
+conduct substantially all of our operations in Hong Kong, if we should become the subject of any such scrutiny, whether any allegations
+are true or not, we may have to expend significant resources to investigate such allegations and/or defend the Company. Such investigations
+or allegations would be costly and time-consuming, and would likely distract our management from our normal business and could result
+in our reputation being harmed. The price of our Class A Ordinary Shares could decline because of such allegations, even if the allegations
+are false.
+
+ 
+
+The Chinese regulators could also disallow
+our organizational structure, which would likely result in a material change in our operations and/or a material change in the value
+of the securities we are registering for sale, including that it could cause the value of such securities to significantly decline or
+become worthless.
+
+ 
+
+We are exposed to various
+risks and uncertainties stemming from the interpretations and implementations of laws and regulations in the PRC. These include, but
+are not limited to, the regulatory scrutiny of PRC companies overseas listings.
+
+ 
+
+Furthermore, we are susceptible
+to potential risks and uncertainties associated with future actions undertaken by the PRC government, which could potentially result
+in the disallowance of the Company s organizational structure. Such an outcome would likely lead to a substantial transformation
+in our operational activities, and as a consequence, the value of our Class A Ordinary Shares may experience a significant depreciation
+or even become worthless.
+
+ 
+
+There
+are political risks associated with conducting business in Hong Kong.
+
+ 
+
+Any
+adverse economic, social and/or political conditions, material social unrest, strike, riot, civil disturbance, or disobedience, as well
+as significant natural disasters, may affect the market and adversely affect the business operations of the Company. Hong Kong is a Special
+Administrative Region of the PRC, and the basic policies of the PRC regarding Hong Kong are reflected in the Basic Law, Hong Kong s
+constitutional document, which provides Hong Kong with a high degree of autonomy and executive, legislative and independent judicial
+powers, including that of final adjudication under the principle of "one country, two systems." However, there is no assurance
+that there will not be any changes in the economic, political, and legal environment in Hong Kong in the future. Since our business is
+based in Hong Kong, any change of such political arrangements may pose immediate threat to the stability of the economy in Hong Kong,
+thereby directly and adversely affecting our results of operations and financial positions.
+
+ 
+
+Under
+the Basic Law of the Hong Kong Special Administrative Region of the People s Republic of China, Hong Kong is exclusively in charge
+of its internal affairs and external relations, while the government of the PRC is responsible for its foreign affairs. As a separate
+customs territory, Hong Kong maintains and develops relations with foreign states and regions. Based on certain recent developments,
+including the Law of the People s Republic of China on Safeguarding National Security in the Hong Kong Special Administrative Region
+issued by the Standing Committee of the PRC National People s Congress ("NPCSC") in June 2020, the U.S. State Department
+has indicated that the United States no longer considers Hong Kong to have significant autonomy from China and, at the time President
+Trump signed an executive order and Hong Kong Autonomy Act ("HKAA") to remove Hong Kong s preferential trade status
+and to authorize the U.S. administration to impose blocking sanctions against individuals and entities who are determined to have materially
+contributed to the erosion of Hong Kong s autonomy. The United States may impose the same tariffs and other trade restrictions
+on exports from Hong Kong that it places on goods from mainland China. These and other recent actions may represent an escalation in
+political and trade tensions involving the U.S, China, and Hong Kong, which could potentially harm our business.
+
+ 
+
+ 26
+
+ 
+
+ 
+
+ 
+
+Given
+the relatively small geographical size of Hong Kong, any of such incidents may have a widespread effect on our business operations, which
+could in turn adversely and materially affect our business, results of operations and financial condition. It is difficult to predict
+the full impact of the HKAA on Hong Kong and companies with operations in Hong Kong like us. Furthermore, legislative, or administrative
+actions in respect of China-U.S. relations could cause investor uncertainty for affected issuers, including us, and the market price
+of our Ordinary Shares could be adversely affected.
+
+ 
+
+Our
+Class A Ordinary Shares may be prohibited from trading in the United States under the HFCAA in the future if the PCAOB is unable to inspect
+or investigate our auditors located in Hong Kong.
+
+ 
+
+As
+an auditor of companies that are registered with the SEC and publicly traded in the United States and a firm registered with the PCAOB,
+our auditor is required under the laws of the United States to undergo regular inspections by the PCAOB to assess their compliance with
+the laws of the United States and professional standards. The PCAOB is currently unable to conduct inspections without the approval of
+the PRC regulators. Currently, our U.S. auditor is inspected by the PCAOB, and we have no operations in mainland China. However, if there
+is significant change to current political arrangements between mainland China and Hong Kong, companies operating in Hong Kong like us
+may face similar regulatory risks as those operated in mainland China and there is no assurance that our auditor s work will continue
+to be able to be inspected by the PCAOB.
+
+ 
+
+Inspections
+of other auditors conducted by the PCAOB outside mainland China have at times identified deficiencies in those auditors audit
+procedures and quality control procedures, which may be addressed as part of the inspection process to improve future audit quality.
+The lack of PCAOB inspections of audit work undertaken in mainland China prevents the PCAOB from regularly evaluating auditors 
+audits and their quality control procedures. As a result, if there is any component of our auditor s work papers become located
+in mainland China in the future, such work papers will not be subject to inspection by the PCAOB. As a result, investors would be deprived
+of such PCAOB inspections, which could result in limitations or restrictions to our access of the U.S. capital markets.
+
+ 
+
+As
+part of a continued regulatory focus in the United States on access to audit and other information currently protected by national law,
+in particular mainland China s, in June 2019, a bipartisan group of lawmakers introduced bills in both houses of the U.S. Congress
+which, if passed, would require the SEC to maintain a list of issuers for which PCAOB is not able to inspect or investigate the audit
+work performed by a foreign public accounting firm completely. The proposed Ensuring Quality Information and Transparency for Abroad-Based
+Listings on our Exchanges ("EQUITABLE") Act prescribes increased disclosure requirements for these issuers and, beginning
+in 2025, the delisting from U.S. national securities exchanges, such as the Nasdaq Capital Market, of issuers included on the SEC s
+list for three consecutive years. It is unclear if this proposed legislation will be enacted. Furthermore, there have been recent deliberations
+within the U.S. government regarding potentially limiting or restricting Chinese companies from accessing U.S. capital markets.
+
+ 
+
+On
+May 20, 2020, the U.S. Senate passed the HFCAA, which includes requirements for the SEC to identify issuers whose audit work is performed
+by auditors that the PCAOB is unable to inspect or investigate completely because of a restriction imposed by a non-U.S. authority in
+the auditor s local jurisdiction. The U.S. House of Representatives passed the HFCAA on December 2, 2020, and the HFCAA was signed
+into law on December 18, 2020. Additionally, in July 2020, the U.S. President s Working Group on Financial Markets issued recommendations
+for actions that can be taken by the executive branch, the SEC, the PCAOB or other federal agencies and department with respect to Chinese
+companies listed on U.S. stock exchanges and their audit firms, in an effort to protect investors in the United States. In response,
+on November 23, 2020, the SEC issued guidance highlighting certain risks (and their implications to U.S. investors) associated with investments
+in Chinese issuers and summarizing enhanced disclosures the SEC recommends Chinese issuers make regarding such risks.
+
+ 
+
+ 27
+
+ 
+
+ 
+
+ 
+
+On
+March 24, 2021, the SEC adopted interim final rules relating to the implementation of certain disclosure and documentation requirements
+in the HFCAA. On December 2, 2021, the SEC adopted amendments to finalize rules implementing the submission and disclosure requirements
+in the HFCAA. The rules apply to registrants that the SEC identifies as having filed an annual report with an audit report issued by
+a registered public accounting firm that is located in a foreign jurisdiction and that PCAOB is unable to inspect or investigate. We
+will be required to comply with these rules if the SEC identifies us as having a "non-inspection" year under a process to
+be subsequently established by the SEC. The final amendments require any identified registrant to submit documentation to the SEC establishing
+that the registrant is not owned or controlled by a government entity in the public accounting firm s foreign jurisdiction, and
+also require, among other things, disclosure in the registrant s annual report regarding the audit arrangements of, and government
+influence on, such registrants. Under the HFCAA, our securities may be prohibited from trading on Nasdaq or other U.S. stock exchanges
+if our auditor is not inspected by the PCAOB for three consecutive years, and this ultimately could result in our Ordinary Shares being
+delisted.
+
+ 
+
+On
+June 22, 2021, the U.S. Senate passed the AHFCAA, which was enacted on December 29, 2022, amending the HFCAA and requiring the SEC to
+prohibit an issuer s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for
+two consecutive years instead of three, thus reducing the time before our Ordinary Shares may be prohibited from trading or delisted.
+
+ 
+
+On
+September 22, 2021, the PCAOB adopted a final rule implementing the HFCAA, which provides a framework for the PCAOB to use when determining,
+as contemplated under the HFCAA, whether the Board is unable to inspect or investigate completely registered public accounting firms
+located in a foreign jurisdiction because of a position taken by one or more regulators in that jurisdiction.
+
+ 
+
+On
+November 5, 2021, the SEC approved the PCAOB s Rule 6100, Board Determinations Under the HFCAA. Rule 6100 provides a framework
+for the PCAOB to use when determining, as contemplated under the HFCAA, whether it is unable to inspect or investigate completely registered
+public accounting firms located in a foreign jurisdiction because of a position taken by one or more regulators in that jurisdiction.
+
+ 
+
+On
+December 2, 2021, the SEC issued amendments to finalize rules implementing the submission and disclosure requirements in the HFCAA. The
+rules apply to registrants that the SEC identifies as having filed an annual report with an audit report issued by a registered public
+accounting firm that is located in a foreign jurisdiction and that PCAOB is unable to inspect or investigate completely because of a
+position taken by an authority in foreign jurisdictions ("Commission-Identified Issuers"). The final amendments require Commission-Identified
+Issuers to submit documentation to the SEC establishing that, if true, it is not owned or controlled by a governmental entity in the
+public accounting firm s foreign jurisdiction. The amendments also require that a Commission-Identified Issuer that is a "foreign
+issuer," as defined in Exchange Act Rule 3b-4, provide certain additional disclosures in its annual report for itself and any of
+its consolidated foreign operating entities. Further, the release provides notice regarding the procedures the SEC has established to
+identify issuers and to impose trading prohibitions on the securities of certain Commission-Identified Issuers, as required by the HFCAA.
+The SEC will identify Commission-Identified Issuers for fiscal years beginning after December 18, 2020. A Commission-Identified Issuer
+will be required to comply with the submission and disclosure requirements in the annual report for each year in which it was identified.
+If a registrant is identified as a Commission-Identified Issuer based on its annual report for the fiscal year ended December 31, 2021,
+the registrant will be required to comply with the submission or disclosure requirements in its annual report filing covering the fiscal
+year ended December 31, 2022. The final amendments became effective on January 10, 2022.
+
+ 
+
+ 28
+
+ 
+
+ 
+
+ 
+
+On
+December 16, 2021, the PCAOB issued a report on its determinations that it was unable to inspect or investigate completely PCAOB-registered
+public accounting firms headquartered in mainland China and in Hong Kong, because of positions taken by PRC regulators in those jurisdictions.
+The PCAOB made its determinations pursuant to PCAOB Rule 6100, which provides a framework for how the PCAOB fulfills its responsibilities
+under the HFCAA. The report further listed in its Appendix A and Appendix B, Registered Public Accounting Firms Subject to the mainland
+China Determination and Registered Public Accounting Firms Subject to the Hong Kong Determination, respectively. Our auditor, TAAD LLP,
+which is based in Diamond Bar, California,
+is registered with the PCAOB, is subject to PCAOB regular inspection and was last inspected in November 2022.
+
+ 
+
+On
+August 26, 2022, the CSRC, the MOF, and the PCAOB signed the Protocol to allow the PCAOB to inspect and investigate completely registered
+public accounting firms headquartered in mainland China and Hong Kong, consistent with the HFCAA, and the PCAOB will be required to reassess
+its determinations by the end of 2022. Pursuant to the fact sheet with respect to the Protocol disclosed by the SEC, the PCAOB shall
+have independent discretion to select any issuer audits for inspection or investigation and has the unfettered ability to transfer information
+to the SEC.
+
+ 
+
+On
+December 15, 2022, the PCAOB Board determined that the PCAOB was able to secure complete access to inspect and investigate registered
+public accounting firms headquartered in mainland China and Hong Kong and voted to vacate its previous determinations to the contrary.
+However, should PRC regulators obstruct or otherwise fail to facilitate the PCAOB s access in the future, the PCAOB Board will
+consider the need to issue a new determination. On December 29, 2022, the AHFCAA was enacted, which amended the HFCAA by decreasing the
+number of non-inspection years from three years to two, thus reducing the time period before our common stock may be prohibited from
+trading or delisted. Notwithstanding the foregoing, in the event it is later determined that the PCAOB is unable to inspect or investigate
+completely our auditor, then such a lack of inspection could cause our securities to be delisted from the stock exchange.
+
+ 
+
+The
+SEC is assessing how to implement other requirements of the HFCAA, including the listing and trading prohibition requirements described
+above. Future developments in respect of increasing U.S. regulatory access to audit information are uncertain, as the legislative developments
+are subject to the legislative process and the regulatory developments are subject to the rule-making process and other administrative
+procedures.
+
+ 
+
+While
+the CSRC, the SEC and the PCAOB have entered into the SOP Agreements regarding the inspection of PCAOB-registered accounting firms in
+mainland China and Hong Kong, there can be no assurance that we will be able to comply with requirements imposed by U.S. regulators if
+there is significant change to current political arrangements between mainland China and Hong Kong. Delisting of our Ordinary Shares
+would force holders of our Ordinary Shares to sell their Ordinary Shares. The market price of our Ordinary Shares could be adversely
+affected as a result of anticipated negative impacts of these executive or legislative actions upon, regardless of whether these executive
+or legislative actions are implemented and regardless of our actual operating performance.
+
+ 
+
+The
+enactment of the law of the PRC on Safeguarding National Security in the Hong Kong Special Administrative Region (the "Hong Kong
+National Security Law") could impact our Hong Kong subsidiaries, which represent substantially all of our business.
+
+ 
+
+On
+June 30, 2020, the NPCSC adopted the Hong Kong National Security Law. This law defines the duties and government bodies of the Hong Kong
+National Security Law for safeguarding national security and four categories of offenses — secession, subversion, terrorist activities,
+and collusion with a foreign country or external elements to endanger national security — and their corresponding penalties. On
+July 14, 2020, then-U.S. President Donald Trump signed the HKAA, into law, authorizing the U.S. administration to impose blocking sanctions
+against individuals and entities determined to have materially contributed to the erosion of Hong Kong s autonomy. On August 7,
+2020, the U.S. government imposed HKAA-authorized sanctions on eleven individuals, including former and current Chief Executives of HKSAR,
+Carrie Lam and John Lee, respectively. On October 14, 2020, the U.S. State Department submitted to relevant committees of Congress the
+report required under HKAA, identifying persons materially contributing to "the failure of the Government of China to meet its
+obligations under the Joint Declaration or the Basic Law." The HKAA further authorizes secondary sanctions, including the imposition
+of blocking sanctions, against foreign financial institutions that knowingly conduct a significant transaction with foreign persons sanctioned
+under this authority. The imposition of sanctions may directly affect foreign companies, investment, or financial institutions and any
+third parties or customers dealing with any foreign entities that are targeted. It is difficult to predict the full impact of the Hong
+Kong National Security Law and HKAA on Hong Kong and companies located in Hong Kong. If our subsidiaries, which represent substantially
+all of our business, are determined to be in violation of the Hong Kong National Security Law or the HKAA by competent regulators, our
+business operations, financial position and results of operations could be materially and adversely affected.
+
+ 
+
+ 29
+
+ 
+
+ 
+
+ 
+
+Compliance
+with Hong Kong s Personal Data (Privacy) Ordinance and any such other existing or future data privacy related laws, regulations
+and governmental orders may entail significant expenses and could materially affect our business.
+
+ 
+
+Our
+business and operations in Hong Kong are subject to data privacy related laws and regulations. In particular, the PDPO imposes a duty
+on any data user who, either alone or jointly with other persons, controls the collection, holding, processing or use of any personal
+data which relates directly or indirectly to a living individual and can be used to identify that individual. Under the PDPO, data users
+shall take all practicable steps to protect the personal data they hold from any unauthorized or accidental access, processing, erasure,
+loss, or use. Once collected, such personal data should not be kept longer than necessary for the fulfilment of the purpose for which
+it is or is to be used and shall be erased if it is no longer required, unless erasure is prohibited by law or is not in the public interest.
+
+ 
+
+The
+PDPO also confers on the Privacy Commissioner for Personal Data ("Privacy Commissioner") power to conduct investigations
+and institute prosecutions. The data protection principles (collectively, the "Data Protection Principles"), which are contained
+in Schedule 1 to the PDPO, outline how data users should collect, handle, and use personal data, complemented by other provisions imposing
+further compliance requirements. The collective objective of the Data Protection Principles is to ensure that personal data is collected
+on a fully informed basis and in a fair manner, with due consideration towards minimizing the amount of personal data collected. Once
+collected, the personal data should be processed in a secure manner and should only be kept for as long as necessary for the fulfillment
+of the purposes of using the data. Use of the data should be limited to or related to the original collection purpose. Data subjects
+are given certain rights, inter alia: (a) the right to be informed by a data user whether the data user holds personal data of which
+the individual is the data subject; (b) if the data user holds such data, to be supplied with a copy of such data; and (c) the right
+to request correction of any data they consider to be inaccurate. The Commissioner may carry out criminal investigations and institute
+prosecution for certain offenses. Depending on the severity of the cases, the Privacy Commissioner will decide whether to prosecute or
+refer cases involving suspected commission to the Department of Justice of Hong Kong. Victims may also seek compensation by civil action
+from data users for damage caused by a contravention of the PDPO. The Commissioner may provide legal assistance to the aggrieved data
+subjects if the Privacy Commissioner deems fit to do so.
+
+ 
+
+If
+our business operations in Hong Kong violates any provisions of the PDPO, we could face significant civil penalties and/or criminal prosecution.
+Based on advice of counsel, we believe we have established the necessary protocols and data collection standards to ensure our compliance
+with the PDPO.
+
+ 
+
+We
+are incorporated under the laws of the Cayman Islands and are subject to its Data Protection Act, which regulates our collection and
+processing of personal data of our investors. A cyberattack, security breach or other unauthorized access or interruption to our information
+technology systems or those of any third-party service providers could harm our reputation and subject us to significant liability.
+
+ 
+
+We
+collect, process, and maintain personal data about investors of the Company pursuant to the Data Protection Act (Revised) of the Cayman
+Islands, as amended from time to time as well as any regulations, codes of practice, or orders promulgated pursuant thereto (the "DPA").
+We are committed to processing personal data in accordance with the DPA. In our use of personal data, we will be characterized under
+the DPA as a "data controller" whilst certain of our service providers, affiliates, and delegates may act as "data
+processors" under the DPA. These service providers may process personal information for their own lawful purposes in connection
+with services provided to us. By virtue of your investment in the Company, we and certain of our third-party service providers may collect,
+record, store, transfer and otherwise process personal data by which individuals may be directly or indirectly identified. Your personal
+data will be processed fairly and for lawful purposes, including: (i) where the processing is necessary for us to perform a contract
+to which you are a party or for taking pre-contractual steps at your request; (ii) where the processing is necessary for compliance with
+any legal, tax, or regulatory obligations to which we are subject; or (iii) where the processing is for the purposes of legitimate interests
+pursued by us or by a service provider to whom the data are disclosed. As a data controller, we will only use your personal data for
+the purposes for which we collected it. We anticipate that we will share your personal data with our third-party service providers for
+certain purposes (see "Certain Cayman Islands Company Considerations - Data Protection in Cayman Islands — Privacy Notice").
+We may also share relevant personal data where it is lawful to do so and necessary to comply with our contractual obligations or your
+instructions, or where it is necessary or desirable to do so in connection with any regulatory reporting obligations. In exceptional
+circumstances, we will share your personal data with regulatory, prosecuting, and other governmental agencies or departments, and parties
+to litigation (whether pending or threatened), in any country or territory, including to any other person where we have a public or legal
+duty to do so (e.g., to assist with detecting and preventing fraud, tax evasion, and financial crime or compliance with a court order).
+
+ 
+
+ 30
+
+ 
+
+ 
+
+ 
+
+We
+are fully aware that cybersecurity threats, privacy breaches, insider threats or other incidents and malicious internet-based activity
+continue to increase, evolve in nature, and become more sophisticated. Information security risks for companies such as ours have significantly
+increased in recent years in part because of the proliferation of new technologies, the use of internet and telecommunications technologies
+to conduct financial transactions, and the increased sophistication and activities of organized crime, hackers, terrorists, and other
+external parties, as well as nation-state and nation-state-supported actors. Many companies that provide services similar to ours have
+also reported a significant increase in cyberattack activity since the beginning of the COVID-19 pandemic.
+
+ 
+
+We
+currently do not maintain cybersecurity insurance, and in the event that we were to seek to obtain such insurance coverage, it may not
+be available on acceptable terms or may not be available in sufficient amounts to cover one or more large claims in connection with cybersecurity
+liabilities. Insurers could also deny coverage as to any future claim.
+
+ 
+
+We
+may become subject to a variety of PRC laws and other regulations regarding data security or securities offerings that are conducted
+overseas and/or other foreign investment in Chinese issuers, and any failure to comply with applicable laws and regulations could have
+a material and adverse effect on our business, financial condition and results of operations and may hinder our ability to offer or continue
+to offer our Ordinary Shares to investors and cause the value of our Ordinary Shares to significantly decline or be worthless.
+
+ 
+
+On
+June 10, 2021, the NPCSC enacted the PRC Data Security Law, which took effect on September 1, 2021. The law requires data collection
+to be conducted in a legitimate and proper manner and stipulates that, for the purpose of data protection, data processing activities
+must be conducted based on data classification and hierarchical protection system for data security.
+
+ 
+
+On
+July 6, 2021, the General Office of the Communist Party of China Central Committee and the General Office of the State Council jointly
+issued a document to crack down on certain activities in the securities market and promote the high-quality development of the capital
+markets, which, among other things, requires the relevant regulators to strengthen cross-border oversight of law-enforcement and judicial
+cooperation, to enhance supervision over Chinese companies listed overseas and to establish and improve the system of extraterritorial
+application of the PRC securities laws.
+
+ 
+
+On
+August 20, 2021, the 30th meeting of the Standing Committee of the 13th National People s Congress voted and passed the "Personal
+Information Protection Law of the People s Republic of China", or the "PRC Personal Information Protection Law",
+which became effective on November 1, 2021. The PRC Personal Information Protection Law applies to the processing of personal information
+of natural persons within the territory of China that is carried out outside of China where (1) such processing is for the purpose of
+providing products or services for natural persons within China, (2) such processing is to analyze or evaluate the behavior of natural
+persons within China, or (3) there are any other circumstances stipulated by related laws and administrative regulations.
+
+ 
+
+ 31
+
+ 
+
+ 
+
+ 
+
+On
+February 17, 2023, the CSRC released the New Overseas Listing Rules with five interpretive guidelines, which took effect on March 31,
+2023. The New Overseas Listing Rules require Chinese domestic enterprises to complete filings with relevant governmental authorities
+and report related information under certain circumstances, such as: a) an issuer making an application for initial public offering and
+listing in an overseas market; b) an issuer making an overseas securities offering after having been listed on an overseas market; c)
+a domestic company seeking an overseas direct or indirect listing of its assets through single or multiple acquisition(s), share swap,
+transfer of shares or other means. The new rules provide that the determination as to whether a Chinese domestic company is indirectly
+offering and listing securities on an overseas market shall be made on a substance over form basis, and if the issuer meets the following
+conditions, the offering and listing shall be determined as an indirect overseas offering and listing by a Chinese domestic company:
+(i) any of the revenue, profit, total assets or net assets of the Chinese domestic entity is more than 50% of the related financials
+in the issuer s audited consolidated financial statements for the most recent fiscal year; (ii) the senior managers in charge of
+business operation and management of the issuer are mostly Chinese citizens or with regular domicile in China, the main locations of
+its business operations are in China or main business activities are conducted in China. If a domestic company fails to complete the
+required filing procedures or conceals any material fact or falsifies any major content in its filing documents, such domestic company
+may be subject to administrative penalties, such as an order to rectify, warnings and fines, and its controlling shareholders, actual
+controllers, the person directly in charge and other directly liable persons may also be subject to administrative penalties, such as
+warnings and fines.
+
+ 
+
+On
+December 28, 2021, the CAC jointly with the relevant regulators formally published Measures for Cybersecurity Review (2021) which took
+effect on February 15, 2022 and replace the former Measures for Cybersecurity Review (2020) issued on April 13, 2020. Measures for Cybersecurity
+Review (2021) stipulates that operators of critical information infrastructure purchasing network products and services and online platform
+operators (together with the operators of critical information infrastructure, the "Operators") carrying out data processing
+activities that affect or may affect national security, shall conduct a cybersecurity review, any and online platform operator who controls
+more than one million users personal information must go through a cybersecurity review by the cybersecurity review office if
+it seeks to be listed in a foreign country.
+
+ 
+
+We
+may in the future collect and store certain data (including certain personal information) from our customers, who may be PRC individuals,
+in connection with our business and operations and for "Know Your Customers" purposes (to combat money laundering). However,
+given that (i) our subsidiaries are incorporated and located in Hong Kong; and (ii) pursuant to the Basic Law, which is a national law
+of the PRC and the constitutional document for Hong Kong, national laws of the PRC shall not be applied in Hong Kong, except for those
+listed in Annex III of the Basic Law (which is confined to laws relating to foreign affairs and defense, as well as other matters outside
+the autonomy of Hong Kong), we currently do not expect the Measures for Cybersecurity Review (2021), the PRC Personal Information Protection
+Law and the New Overseas Listing Rules to have an impact on us or on this offering. we believe that we are in full compliance with the
+rules and regulations promulgated by the CAC and CSRC and associated policies as issued to current date.
+
+ 
+
+As
+of the date of this prospectus, we are advised by our Chinese counsel, Guangdong Wesley Law Firm, that the Company is not subject to
+the New Overseas Listing Rules.
+
+ 
+
+These
+statements and regulatory actions are new, and it is highly uncertain how soon the legislative or administrative regulation making bodies
+will respond and what existing or new laws or regulations or detailed implementations and interpretations will be modified or promulgated,
+if any. It is also highly uncertain what the potential impact such modified or new laws and regulations will have on our daily business
+operations, our abilities to accept foreign investments and the listing of our Class A Ordinary Shares on a U.S. or other foreign exchanges.
+There remains significant uncertainty in the interpretation and enforcement of relevant PRC cybersecurity laws and regulations. If the
+New Overseas Listing Rules are adopted into law in the future and becomes applicable to us, and if we are deemed to be an "Operator"
+required to file for cybersecurity review before listing in the United States or if the Measures for Cybersecurity Review (2021) or the
+PRC Personal Information Protection Law becomes applicable to us, our business operations and the listing of our Ordinary Shares in the
+United States could be subject to the CAC s cybersecurity review or CSRC Overseas Issuance and Listing review in the future. If
+we become subject to the CAC or CSRC review, there is no assurance that we will be able to comply with the regulatory requirements in
+all respects, and the current practice of collecting and processing personal information may be ordered to be rectified or terminated
+by regulators. In the event of a failure to comply, we may become subject to fines and other penalties, which may have a material adverse
+effect on our business, financial condition and results of operations, may hinder our ability to offer or continue to offer Ordinary
+Shares to investors and cause the value of our Class A Ordinary Shares to significantly decline or be worthless.
+
+ 
+
+If the PRC government chooses
+to exert more oversight and control over offerings that are conducted overseas and/or foreign investment in Chinese issuers, such action
+may significantly limit or completely hinder our ability to offer or continue to offer Ordinary Shares to investors and cause the value
+of our Ordinary Shares to significantly decline or be worthless.
+
+ 
+
+ 32
+
+ 
+
+ 
+
+ 
+
+These
+recent statements, laws, and regulations by the PRC government, including the Measures for Cybersecurity Review (2021), the PRC Personal
+Information Protection Law and the New Overseas Listing Rules, have indicated an intent to exert greater oversight and control over offerings
+that are conducted overseas and/or foreign investments in Chinese issuers. Currently, we do not operate in mainland China and we do not
+maintain any personal information of PRC residents. However, it is uncertain whether the PRC government will adopt additional requirements
+or extend the existing requirements to apply to our business operations in Hong Kong. We could be subject to approval or review of Chinese
+regulators to pursue this offering. Any future action by the PRC government expanding the categories of industries and companies whose
+foreign securities offerings are subject to review by the CSRC could significantly limit or completely hinder our ability to offer or
+continue to offer securities to investors and could cause the value of such securities to significantly decline or be worthless.
+
+ 
+
+If
+the PRC government were to impose new regulatory approval requirements for the Company to issue the Class A Ordinary Shares to foreign
+investors or list on a foreign exchange, such action could significantly limit or completely hinder our ability to offer or continue
+to offer Class A Ordinary Shares and other securities to investors and cause such securities to significantly decline in value or become
+worthless.
+
+ 
+
+On
+July 6, 2021, the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council
+jointly issued the "Opinions on Severely Cracking Down on Illegal Securities Activities According to Law" (the "Opinions").
+The Opinions emphasized the need to strengthen the administration over illegal securities activities and the need to strengthen the supervision
+over overseas listings by Chinese companies.
+
+ 
+
+Based on the advice of
+our PRC counsel, Guangdong Wesley Law Firm, (i) we are
+not currently required to obtain permissions from any PRC regulators to operate or to issue securities to foreign investors; and (ii)
+we are not subject to permission requirements from CSRC, CAC or any other entity that is required to approve our operations.
+
+ 
+
+If
+we have erroneously concluded that these permission requirements do not apply to us, or if applicable laws, regulations, or interpretations
+change, and it is determined in the future that the permission requirements become applicable to us, we may be subject to review, may
+face challenges in addressing these requirements and may incur substantial costs in complying with these requirements, which could result
+in material adverse changes in our business, financial condition and results of operations. In addition, if we are not able to fully
+comply with the Measures for Cybersecurity Review (2021 version) or if the Opinions are determined to be applicable to us, our ability
+to offer or to continue to offer securities to investors may be significantly limited or completely hindered, and our securities may
+significantly decline in value or become worthless.
+
+ 
+
+Given
+the current PRC regulatory environment, it is uncertain whether the Company will be required to obtain permission from the PRC government
+to list on U.S. stock exchanges in the future, and if such permission is required, whether it will be denied or later rescinded. We have
+been closely monitoring regulatory developments in China regarding any necessary approvals from the CSRC or other PRC regulators required
+for overseas listings, including this offering. As of the date of this prospectus, we have not received any inquiry, notice, warning,
+sanctions, or regulatory objection to this offering from the CSRC or other PRC regulators. However, there remains significant uncertainty
+as to the enactment, interpretation and implementation of regulatory requirements related to overseas securities offerings and other
+capital markets activities.
+
+ 
+
+ 33
+
+ 
+
+ 
+
+ 
+
+On
+February 17, 2023, with the approval of the State Council, the CSRC promulgated the New Overseas Listing Rules, and five supporting guidelines,
+which became effective on March 31, 2023. Pursuant to the New Overseas Listing Rules, domestic companies that seek to offer or list securities
+overseas, both directly and indirectly, shall complete filing procedures with the CSRC pursuant to the requirements of the New Overseas
+Listing Rules within three working days following their submission of initial public offerings or listing applications. If a domestic
+company fails to complete the required filing procedures or conceals any material fact or falsifies any major content in its filing documents,
+such domestic company may be subject to administrative penalties, such as an order to rectify, warnings and fines, and its controlling
+shareholders, actual controllers, the person directly in charge and other directly liable persons may also be subject to administrative
+penalties, such as warnings and fines; if the issuer meets both of the following criteria, the overseas offering and listing conducted
+by such issuer shall be deemed an indirect overseas offering and listing by a PRC domestic company: (A) 50% or more of any of the issuer s
+operating revenue, total profit, total assets or net assets as documented in its audited consolidated financial statements for the most
+recent fiscal year were derived from PRC domestic companies; and (B) the majority of the issuer s business activities are carried
+out in mainland China, or its main place(s) of business are located in mainland China, or the majority of its senior management team
+in charge of its business operations and management are PRC citizens or have their usual place(s) of residence located in mainland China.
+In such circumstances, where a PRC domestic company is seeking an indirect overseas offering and listing in an overseas market, the issuer
+shall designate a major domestic operating entity responsible for all filing procedures with the CSRC, and where an issuer makes an application
+for an initial public offering or listing in an overseas market, the issuer shall submit filings with the CSRC within three business
+days after such application is submitted.
+
+ 
+
+If
+it is determined in the future that the approval of the CSRC, the CAC or any other regulator is required for this offering, we may face
+sanctions by the CSRC, the CAC or other PRC regulators. These regulators may impose fines and penalties on our operations in China, limit
+our ability to pay dividends outside of China, limit our operations in China, delay or restrict the repatriation of the proceeds from
+this offering into China or take other actions that could have a material adverse effect on our business, financial condition, results
+of operations and prospects, as well as the trading price of our securities. The CSRC, the CAC, or other PRC regulators also may take
+actions requiring us, or making it advisable for us, to halt this offering before settlement and delivery of our Class A Ordinary Shares.
+Consequently, if you engage in market trading or other activities in anticipation of and prior to the settlement and delivery of our
+Class A Ordinary Shares, you do so at the risk that settlement and delivery may not occur. In addition, if the CSRC, the CAC or other
+PRC regulators later promulgate new rules requiring that we obtain their approvals for this offering, we may be unable to obtain a waiver
+of such approval requirements, if and when procedures are established to obtain such a waiver. Any uncertainties and/or negative publicity
+regarding such an approval requirement could have a material adverse effect on the trading price of our securities.
+
+ 
+
+As
+of the date of this prospectus, we: (i) are not required to obtain permissions from any PRC regulators to operate or issue our Class
+A Ordinary Shares to foreign investors; (ii) are not subject to permission requirements from the CSRC, the CAC or any other entity that
+is required to approve of our subsidiaries operations; and (iii) have not received or were denied such permissions by any PRC
+regulators. Given the current PRC regulatory environment, it is uncertain when and whether we will be required to obtain permission from
+the PRC government to list on U.S. stock exchanges in the future, and even when such permission is obtained, whether it will be denied
+or rescinded.
+
+ 
+
+As of the date of this prospectus,
+we: (i) are not required to obtain permissions from any PRC regulators to operate or issue our Class A Ordinary Shares to foreign investors;
+(ii) are not subject to permission requirements from the CSRC, the CAC or any other entity that is required to approve of our subsidiaries 
+operations; and (iii) have not received or were denied such permissions by any PRC regulators. We are also currently not required to
+obtain any pre-approval from Chinese regulators to list on a U.S. stock exchange such as Nasdaq. Given the current PRC regulatory environment,
+it is uncertain when and whether we will be required to obtain permission from the PRC government to list on U.S. stock exchanges in
+the future, and even when such permission is obtained, whether it will be denied or rescinded. As of the date of this prospectus, we
+have not received any inquiry, notice, warning, sanctions, or regulatory objection to this offering from the CSRC or other PRC regulators.
+However, if we are required to obtain approval in the future and are denied permission from Chinese regulators to list on U.S. stock
+exchanges, we will not be able to list on a U.S. stock exchange, which would materially affect the interest of our investors.
+
+ 
+
+ 34
+
+ 
+
+ 
+
+ 
+
+In
+response to recent data security concerns arising from overseas listings of Chinese internet companies operating in the PRC, on January
+4, 2022, the CAC issued revised measures to expand the types of businesses and circumstances that would require cybersecurity review
+by the CAC. We believe that we may be directly subject to these regulatory actions or statements as our business involves the collection
+of user data and may implicate cybersecurity and involve any other type of restricted industry. Because these statements and regulatory
+actions are new, however, it is highly uncertain how soon legislative or administrative regulation making bodies in China will respond
+to them, or what existing or new laws or regulations will be modified or promulgated, if any, or what the potential impact any such modified
+or new laws and regulations will be on our daily business operations or our ability to accept foreign investments and list on a U.S.
+stock exchange. For further information, see "Risks Factors – Risks Related to Doing Business in the PRC."
+
+ 
+
+Any
+future action by the PRC government to exert more oversight and control over offerings that are conducted overseas and/or foreign investment
+in Chinese issuers or expanding the categories of industries and companies whose foreign securities offerings are subject to government
+review could significantly limit or completely hinder our ability to offer or continue to offer securities to investors and cause the
+value of our securities to significantly decline or the securities to become worthless.
+
+ 
+
+Recent
+statements by the PRC government have indicated an intent to exert greater oversight and control over offerings that are conducted overseas
+and/or over foreign investments in Chinese issuers. On July 6, 2021, the General Office of the Communist Party of China Central Committee
+and the General Office of the State Council jointly issued a document to crack down on illegal activities in the securities market and
+promote the high-quality development of the capital market, which, among other things, requires the relevant regulators to strengthen
+cross-border oversight of law-enforcement and judicial cooperation, to enhance supervision over Chinese companies listed overseas, and
+to establish and improve the system of extraterritorial application of the PRC securities laws.
+
+ 
+
+Additionally, we could be
+subject to various government and regulatory interference in the regions in which we operate, which could result in a material change
+in our operations and the value of the securities. Pursuant to Article 6 of the Revised Draft of the
+Cybersecurity Review Measures, companies holding data of more than one million users must now apply for cybersecurity approval
+when seeking overseas listings because of the risk that such data and personal information could be "affected, controlled, and
+maliciously exploited by foreign governments." As confirmed by our PRC counsel, Guangdong Wesley Law Firm,
+we currently are not subject to cybersecurity review with the CAC to conduct business operations in China, given that: (i) we are not
+the "operator of critical information infrastructure" or "online platform operator"; (ii) we do not possess a
+large amount of personal information in our business operations; and (iii) as of the date of this prospectus, we have not been involved
+in any investigations initiated by the CAC, nor have we received any inquiry, notice, warning or sanction in such respect.
+
+ 
+
+On
+February 17, 2023, with the approval of the State Council, the CSRC promulgated the New Overseas Listing Rules, and five supporting guidelines,
+which came into effect on March 31, 2023. Pursuant to the New Overseas Listing Rules, domestic companies that seek to offer or list securities
+overseas, both directly and indirectly, shall complete filing procedures with the CSRC pursuant to the requirements of the New Overseas
+Listing Rules within three working days following their submission of initial public offerings or listing applications. If a domestic
+company fails to complete the required filing procedures or conceals any material fact or falsifies any major content in its filing documents,
+such domestic company may be subject to administrative penalties, such as an order to rectify, warnings and fines, and its controlling
+shareholders, actual controllers, the person directly in charge and other directly liable persons may also be subject to administrative
+penalties, such as warnings and fines.
+
+ 
+
+As
+of the date of this prospectus, we have not received any formal inquiry, notice, warning, sanction, or objection from the CSRC with respect
+to the listing of our Ordinary Shares, the filing requirements under the Trial Measurements do not apply to the Company since: (i) the
+Company is a holding company incorporated as an exempted company with limited liability under the laws of the Cayman Islands with a subsidiary
+operating and based in Hong Kong; (ii) the Company have no subsidiary, VIE structure or any direct operations in mainland China, nor
+do intend to have any subsidiary or VIE structure or to acquire any equity interests in any domestic companies in mainland China, and
+the Company are not controlled by any companies or individuals of mainland China; (iii) the Company is headquartered in Hong Kong, with
+their chief executive officer, chief financial officer and all members of the board of directors of MEDG based in Hong Kong (except for
+one independent non-executive director who will commence his term immediately prior to the completion of this offering) and none being
+a citizen of mainland China; and (iv) all of their revenues and profits are generated by their operating entities in Hong Kong. 
+
+ 
+
+ 35
+
+ 
+
+ 
+
+ 
+
+However,
+there is no assurance that the relevant PRC regulators, including the CSRC, would reach the same conclusion as us, or that the CSRC or
+any other PRC regulators would not promulgate new rules or new interpretation of current rules (with retrospective effect) to require
+us to obtain CSRC or other PRC governmental approvals for this offering. If we inadvertently concluded that such approvals are not required,
+our ability to offer or continue to offer our Ordinary Shares to investors could be significantly limited or completely hindered, which
+could cause the value of our Ordinary Shares to significantly decline or become worthless. We may also face sanctions by the CSRC, the
+CAC or other PRC regulators. These regulators may impose fines, penalties, limit our operations in China and Hong Kong, or take other
+actions that could have a material adverse effect on our business, financial condition, results of operations and prospects, as well
+as the trading price of our securities.
+
+ 
+
+The
+promulgation of new laws or regulations, or the new interpretation of existing laws and regulations, may restrict or otherwise unfavorably
+impact our ability or way to conduct business and may require us to change certain aspects of our business to ensure compliance, which
+could decrease demand for our services, reduce revenues, increase costs, require us to obtain more licenses, permits, approvals or certificates,
+or subject us to additional liabilities.
+
+ 
+
+Risks
+Related to Our Securities and the Offering
+
+ 
+
+An
+active trading market for our Class A Ordinary Shares may not be established or, if established, may not continue.
+
+ 
+
+There
+is no assurance that a liquid public market for our Class A Ordinary Shares will be established. If an active public market for our Ordinary
+Shares does not occur following the completion of this offering, the market price and liquidity of our Class A Ordinary Shares may be
+materially and adversely affected. The public offering price for our Class A Ordinary Shares in this offering was determined by negotiation
+between us and the underwriters based on several factors, and we can provide no assurance that the trading price of our Class A Ordinary
+Shares after this offering will not decline below the public offering price. As a result, investors in our Class A Ordinary Shares may
+experience a significant decrease in the value of their Ordinary Shares.
+
+ 
+
+We
+may not maintain the listing of our Class A Ordinary Shares on Nasdaq, which could limit investors ability to make transactions
+in our Class A Ordinary Shares and subject us to additional trading restrictions.
+
+ 
+
+We
+intend to list our Class A Ordinary Shares on the Nasdaq Capital Market concurrently with this offering. In order to continue listing
+our shares on the Nasdaq Capital Market, we must maintain certain financial standards and share price levels and we may be unable to
+meet these requirements in the future. There is no assurance that our shares will continue to be listed on Nasdaq in the future.
+
+ 
+
+If
+Nasdaq were to delist our Class A Ordinary Shares and we are unable to list our shares on another national securities exchange, we expect
+that our shares would be quoted on an over-the-counter market in the United States. If this were to occur, we could face significant
+material adverse consequences, including:
+
+ 
+
+ 
+ 
+ 
+ a
+ limited availability of market quotations for our Class A Ordinary Shares;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ reduced
+ liquidity for our Class A Ordinary Shares;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ a
+ determination that our Class A Ordinary Shares are "penny stock," which will require brokers trading in our shares to
+ adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our
+ Class A Ordinary Shares;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ a
+ limited amount of news and analyst coverage; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ a
+ decreased ability to issue additional securities or obtain additional financing in the future.
+
+ 
+ 
+
+ 36
+
+ 
+
+ 
+
+ 
+
+As
+long as our Class A Ordinary Shares are listed on Nasdaq, U.S. federal law prevents or preempts states from regulating their sale. However,
+the law does allow states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity,
+then states can regulate or bar their sale. Further, if we were no longer listed on Nasdaq, we would be subject to regulations in each
+state in which we offer our shares.
+
+ 
+
+Nasdaq
+may apply additional and more stringent criteria for our continued listing.
+
+ 
+
+Nasdaq
+Listing Rule 5101 provides Nasdaq with broad discretionary authority over the initial and continued listing of securities in Nasdaq and
+Nasdaq may use such discretion to deny initial listing, apply additional or more stringent criteria for the initial or continued listing
+of particular securities, or suspend or delist particular securities based on any event, condition, or circumstance that exists or occurs
+that makes initial or continued listing of the securities on Nasdaq inadvisable or unwarranted in the opinion of Nasdaq, even though
+the securities meet all enumerated criteria for initial or continued listing on Nasdaq. In addition, Nasdaq has used its discretion to
+deny initial or continued listing or to apply additional and more stringent criteria in the instances, including but not limited to where
+the company engaged an auditor that has not been subject to an inspection by PCAOB, an auditor that PCAOB cannot inspect, or an auditor
+that has not demonstrated sufficient resources, geographic reach, or experience to adequately perform the company s audit; (ii)
+where a company planned a small public offering, which would result in insiders holding a large portion of the company s listed
+securities. Nasdaq was concerned that an offering size was insufficient to establish the company s initial valuation, and there
+would not be sufficient liquidity to support a public market for the company; and (iii) where the company did not demonstrate sufficient
+nexus to the U.S. capital market, including having no U.S. shareholders, operations, or members of the board of directors or management.
+For the any aforementioned concerns, we may be subject to the additional and more stringent criteria of Nasdaq for our continued listing,
+which might cause delay or even denial of our listing application for our Class A Ordinary Shares.
+
+ 
+
+Our
+stock price may be volatile, and the value of our Class A Ordinary Shares may decline.
+
+ 
+
+We
+cannot predict the prices at which our Class A Ordinary Shares will trade. The initial public offering price of our Class A Ordinary
+Shares will be determined by negotiations between us and the underwriters and may not bear any relationship to the market price at which
+our Class A Ordinary Shares will trade after this offering or to any other established criteria of the value of our business and prospects,
+and the market price of our Class A Ordinary Shares following this offering may fluctuate substantially and may be lower than the initial
+public offering price. In addition, the trading price of our Class A Ordinary Shares following this offering is likely to be volatile
+and could be subject to fluctuations in response to various factors, some of which are beyond our control. These fluctuations could cause
+you to lose all or part of your investment in our Class A Ordinary Shares as you might be unable to sell your Class A Ordinary Shares
+at or above the price you paid in this offering.
+
+ 
+
+The
+stock market has recently experienced extreme price and volume fluctuations. Broad market and industry fluctuations, as well as general
+economic, political, regulatory and market conditions, may also negatively impact the market price of our Class A Ordinary Shares. Price
+volatility may be greater if the public float and trading volume of shares of our Class A Ordinary Shares is low. Furthermore, in the
+past, companies that have experienced volatility in the market price of their securities have been subject to securities class-action
+litigation following periods of volatility in the market price of their securities. We may be the target of this type of litigation in
+the future, which could result in substantial costs, divert management s attention and resources, and harm our business, financial
+condition, and results of operations.
+
+ 
+
+Certain
+recent initial public offerings of companies with smaller public floats have experienced extreme stock price and volume fluctuations
+seemingly unrelated to company performance. Such volatility, if occurs to us, may make it difficult for prospective investors to assess
+the rapidly changing value of our Class A Ordinary Shares.
+
+ 
+
+Certain
+recent instances of extreme stock price and volume fluctuations have been seemingly unrelated to company performance following a number
+of recent initial public offerings, particularly among companies with relatively smaller public floats, and we expect that such instances
+may continue and/or increase in the future. We anticipate that the trading price of our Class A Ordinary Shares following this offering
+is likely to be volatile, and our Class A Ordinary Shares may be subject to rapid and substantial price volatility. Such volatility,
+including any stock run-ups, may be unrelated or disproportionate to our actual or expected operating performance and financial condition
+or prospects and may distort the market perception of our Class A Ordinary Shares, price and our financial performance and public image,
+negatively affect the long-term liquidity of our Class A Ordinary Shares, regardless of our actual or expected operating performance.
+If we encounter such volatility, it will likely make it difficult and confusing for prospective investors to assess the rapidly changing
+value of our Class A Ordinary Shares and understand the value thereof.
+
+ 
+
+ 37
+
+ 
+
+ 
+
+ 
+
+We
+also anticipate that our Class A Ordinary Shares are likely to be more sporadically and thinly traded than that of larger, more established
+companies with larger public floats. As a consequence of this lack of liquidity, the trade of relatively small quantities of Ordinary
+Shares by our stockholders may disproportionately influence the price of those shares in either direction. The price of our Class A Ordinary
+Shares could, for example, decline precipitously in the event that a large number of our Class A Ordinary Shares are sold on the market
+without commensurate demand as compared to a larger, more established issuer that could better absorb those sales without adverse impact
+on its stock price.
+
+ 
+
+If
+securities or industry analysts do not publish research or publish unfavorable or inaccurate research about our business, the market
+price and trading volume of our Class A Ordinary Shares could decline.
+
+ 
+
+The
+market price and trading volume of our Class A Ordinary Shares following the completion of this offering will be heavily influenced by
+the way analysts interpret our financial information and other disclosures. We do not have control over these analysts. If few securities
+analysts commence coverage of us, or if industry analysts cease coverage of us, our Class A Ordinary Share price could be negatively
+affected. If securities or industry analysts do not publish research or reports about our business, downgrade our Class A Ordinary Shares,
+or publish negative reports about our business, our Class A Ordinary Share price would likely decline. If one or more of these analysts
+cease coverage of us or fail to publish reports on us regularly, demand for our Class A Ordinary Shares could decrease, which might cause
+our Class A Ordinary Share price to decline and could decrease the trading volume of our Class A Ordinary Shares.
+
+ 
+
+Because
+we do not expect to pay dividends in the foreseeable future, you must rely on price appreciation of our Class A Ordinary Shares for a
+return on your investment.
+
+ 
+
+We
+currently intend to retain all of our available funds and any future earnings after this offering to fund the development and growth
+of our business. As a result, we do not expect to pay any cash dividends in the foreseeable future. Therefore, you should not rely on
+an investment in our Class A Ordinary Shares as a source for any future dividend income. Our board of directors has complete discretion
+as to whether to distribute dividends, subject to certain requirements of Cayman Islands law. In addition, our shareholders may by ordinary
+resolution declare a dividend, but no dividend may exceed the amount recommended by our directors. Under Cayman Islands law, a Cayman
+Islands company may pay a dividend out of either profit or share premium account, provided that in no circumstances may a dividend be
+paid if this would result in the company being unable to pay its debts as they fall due in the ordinary course of business. Even if our
+board of directors decides to declare and pay dividends, the timing, amount, and form of future dividends, if any, will depend on, among
+other things, our future results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any,
+received by us from our subsidiaries, our financial condition, contractual restrictions, and other factors as determined by our board
+of directors. Accordingly, the return on your investment in our Class A Ordinary Shares will likely depend entirely upon any future price
+appreciation of our Class A Ordinary Shares. There is no guarantee that our Class A Ordinary Shares will appreciate in value after this
+offering or even maintain the price at which you purchased our shares. You may not realize a return on your investment in our Class A
+Ordinary Shares and you may even lose your entire investment.
+
+ 
+
+Because
+our public offering price per share is substantially higher than our net tangible book value per share, you will experience immediate
+and substantial dilution.
+
+ 
+
+If
+you purchase Class A Ordinary Shares in this offering, you will pay substantially more than our net tangible book value per Ordinary
+Share. As a result, you will experience immediate and substantial dilution of US$4.35 per share, representing the difference between
+our as adjusted net tangible book value per share of US$0.31 as of December 31, 2024, after giving effect to the net proceeds
+to us from this offering, assuming no change to the number of Ordinary Shares offered by us as set forth on the cover page of this prospectus
+and an assumed public offering price of US$4.5 per share, which is the mid-point of the public offering price range. For further
+information on the description of how the value of your investment in our Class A Ordinary Shares will be diluted upon the completion
+of this offering, see "Dilution".
+
+ 
+
+ 38
+
+ 
+
+ 
+
+ 
+
+As
+an exempted company incorporated in the Cayman Islands, we are permitted to adopt certain home country practices in relation to corporate
+governance matters that differ significantly from the Nasdaq listing rules and corporate governance standards.
+
+ 
+
+As
+a foreign private issuer that has applied to list our Class A Ordinary Shares on the Nasdaq Capital Market, we rely on a provision in
+the Nasdaq Capital Market corporate governance listing standards that allows us to follow Cayman Islands law with regard to certain aspects
+of corporate governance. This allows us to follow certain corporate governance practices that differ in significant respects from the
+corporate governance requirements applicable to U.S. companies listed on the Nasdaq Capital Market.
+
+ 
+
+For
+example, we are eligible to be exempt from Nasdaq Capital Market regulations that require a listed U.S. company
+to:
+
+ 
+
+ 
+ 
+ 
+ have
+ a majority of the board of directors consist of independent directors;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ require
+ non-management directors to meet on a regular basis without management present;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ have
+ an independent compensation committee;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ have
+ an independent nominating committee; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ seek
+ shareholder approval for the implementation of certain equity compensation plans and dilutive issuances of Class A Ordinary Shares,
+ such as transactions, other than a public offering, involving the sale of 20% or more of our Class A Ordinary Shares for less than
+ the greater of the book or market value of the shares.
+
+ 
+ 
+
+As
+a foreign private issuer, we are permitted to follow home country practice in lieu of the above requirements. Our audit committee is
+required to comply with the provisions of Rule 10A-3 of the Exchange Act, which is applicable to U.S. companies listed on the Nasdaq
+Capital Market. Therefore, we intend to have a fully independent audit committee upon effectiveness of the registration statement of
+which this prospectus is a part, in accordance with Rule 10A-3 of the Exchange Act. However, because we are a foreign private issuer,
+our audit committee is not subject to additional Nasdaq Capital Market corporate governance requirements applicable to listed U.S. companies,
+including the requirements to have a minimum of three members and to affirmatively determine that all members are "independent,"
+using more stringent criteria than those applicable to us as a foreign private issuer.
+
+ 
+
+Further,
+because we are a foreign private issuer under the Exchange Act, we are eligible to be exempt from certain provisions of the securities
+rules and regulations in the United States that are applicable to U.S. domestic issuers, including:
+
+ 
+
+ 
+ 
+ 
+ the
+ rules under the Exchange Act requiring the filing of quarterly reports on Form 10-Q or current reports on Form 8-K with the SEC;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations in respect of a security registered
+ under the Exchange Act;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ sections of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and liability
+ for insiders who profit from trades made in a short period of time; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ selective disclosure rules by issuers of material non-public information under Regulation FD.
+
+ 
+ 
+
+We
+will be required to file an annual report on Form 20-F within four months of the end of each fiscal year. In addition, we intend to publish
+our financial results on a semi-annual basis through press releases distributed pursuant to the rules and regulations of the Nasdaq Capital
+Market. Press releases relating to financial results and material events will also be furnished to the SEC on Form 6-K. However, the
+information we are required to file with or furnish to the SEC will be less extensive and less timely compared to that required to be
+filed with the SEC by U.S. domestic issuers. As a result, you may not be afforded the same protections or information that would be made
+available to you if you were investing in a U.S. domestic issuer.
+
+ 
+
+ 39
+
+ 
+
+ 
+
+ 
+
+We
+may lose our foreign private issuer status in the future, which could result in significant additional costs and expenses to us.
+
+ 
+
+As
+discussed above, we are a foreign private issuer and, therefore, we are not required to comply with all of the periodic disclosure and
+current reporting requirements of the Exchange Act. The determination of foreign private issuer status is made annually on the last Business
+Day of an issuer s most recently completed second fiscal quarter, and, accordingly, the next determination will be made with respect
+to us on September 30, 2025. In the future, we would lose our foreign private issuer status if: (i) more than 50% of our outstanding
+voting securities are owned by U.S. residents; and (ii) a majority of our directors or executive officers are U.S. citizens or residents,
+or we fail to meet additional requirements necessary to avoid the loss of foreign private issuer status. If we were to lose our foreign
+private issuer status, we would be required to file with the SEC periodic reports and registration statements on U.S. domestic issuer
+forms, which are more detailed and extensive than the forms available to a foreign private issuer. We would also have to comply with
+U.S. federal proxy requirements, and our officers, directors and 10% shareholders would become subject to the short-swing profit disclosure
+and recovery provisions of Section 16 of the Exchange Act. In addition, we would lose our ability to rely upon exemptions from certain
+corporate governance requirements under the listing rules of Nasdaq. As a U.S. listed public company that is not a foreign private issuer,
+we would incur significant additional legal, accounting, and other expenses that we do not incur as a foreign private issuer.
+
+ 
+
+We
+will incur significantly increased costs and devote substantial management time as a result of the listing of our Ordinary Shares on
+the Nasdaq Capital Market.
+
+ 
+
+We
+will incur additional legal, accounting, and other expenses as a public reporting company, particularly after we cease to qualify as
+an emerging growth company. For example, we will be required to comply with the additional requirements of the rules and regulations
+of the SEC and Nasdaq rules, including applicable corporate governance practices. We expect that compliance with these requirements will
+increase our legal and financial compliance costs and will make some activities more time-consuming and costly. In addition, we expect
+that our management and other personnel will need to divert attention from operational and other business matters to devote substantial
+time to these public company requirements. We cannot predict or estimate the number of additional costs we may incur as a result of becoming
+a public company or the timing of such costs.
+
+ 
+
+In
+addition, changing laws, regulations and standards relating to corporate governance and public disclosure are creating uncertainty for
+public companies, increasing legal and financial compliance costs, and making some activities more time-consuming. These laws, regulations
+and standards are subject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application
+in practice may evolve over time as new guidelines are provided by regulatory and governing bodies. This could result in continuing uncertainty
+regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. We intend to
+invest resources to comply with evolving laws, regulations and standards, and this investment may result in increased general and administrative
+expenses and a diversion of management s time and attention from revenue-generating activities to compliance activities. If our
+efforts to comply with new laws, regulations and standards differ from the activities intended by regulatory or governing bodies due
+to ambiguities related to their application and practice, regulators may also initiate legal proceedings against us, and our business
+may be adversely affected.
+
+ 
+
+You
+may have more difficulties protecting your interests than you would as a shareholder of a U.S. corporation.
+
+ 
+
+We
+are an exempted company incorporated under the laws of the Cayman Islands with limited liability. Our corporate affairs are governed
+by our Amended and Restated Memorandum and Articles, the Companies Act and the common law of the Cayman Islands. The rights of shareholders
+to take action against our directors and us, actions by our minority shareholders and the fiduciary duties of our directors to us under
+Cayman Islands law are to a large extent governed by the common law of the Cayman Islands. The common law of the Cayman Islands is derived
+in part from comparatively limited judicial precedent in the Cayman Islands as well as from the common law of England, the decisions
+of whose courts are of persuasive authority, but are not binding, on a court in the Cayman Islands. The rights of our shareholders and
+the fiduciary duties of our directors under Cayman Islands law are not as clearly established as they would be under statutes or judicial
+precedent in some jurisdictions in the United States. In particular, the Cayman Islands has a less developed body of securities laws
+than the United States. Some U.S. states, such as Delaware, have more fully developed and judicially interpreted bodies of corporate
+law than the Cayman Islands. In addition, Cayman Islands companies may not have the standing to initiate a shareholder derivative action
+in a federal court of the United States.
+
+ 
+
+ 40
+
+ 
+
+ 
+
+ 
+
+Shareholders
+of Cayman Islands exempted companies like us have no general rights under Cayman Islands law to inspect corporate records (other than
+the memorandum and articles of association and any special resolutions passed by such companies, and the register of mortgages and charges
+of such companies) or to obtain copies of lists of shareholders of these companies. Our directors have discretion under our Amended and
+Restated Memorandum and Articles to determine whether or not, and under what conditions, our corporate records may be inspected by our
+shareholders, but are not obliged to make them available to our shareholders. This may make it more difficult for you to obtain the information
+needed to establish any facts necessary for a shareholder motion or to solicit proxies from other shareholders in connection with a proxy
+contest.
+
+ 
+
+Certain
+corporate governance practices in the Cayman Islands, which is our home country, may differ significantly from requirements for companies
+incorporated in other jurisdictions such as U.S. states. Accordingly, our shareholders may be afforded less protection than they otherwise
+would under rules and regulations applicable to U.S. domestic issuers.
+
+ 
+
+As
+a result of all of the above, shareholders may have more difficulty in protecting their interests in the face of actions taken by our
+management, members of the board of directors or controlling shareholders than they would as shareholders of a company incorporated in
+a U.S. state. For further information on the significant differences between the provisions of the Companies Act and the laws applicable
+to companies incorporated in a U.S. state and their shareholders, see "Certain Cayman Islands Company Considerations —
+Comparison of Cayman Corporate Law and U.S. Corporate Law".
+
+ 
+
+You
+may experience difficulties in effecting service of legal process, enforcing foreign judgments or bringing actions in Hong Kong against
+us or our management named in the prospectus based on foreign laws.
+
+ 
+
+We
+are an exempted company incorporated under the laws of the Cayman Islands. We conduct a substantial amount of operations in Hong Kong,
+and a substantial portion of our assets are located in Hong Kong. In addition, our directors and officers, except for one independent
+non-executive director who will commence his term immediately prior to the completion of this offering, primarily reside in Hong Kong.
+As a result, it may be difficult for our shareholders to effect service of process upon us or our directors and officers within the United
+States or to enforce against us or them judgments obtained in United States courts, including judgments predicated upon the civil liability
+provisions of the securities laws of the United States or any state in the United States. In addition, Hong Kong has no treaties providing
+for the reciprocal recognition and enforcement of judgments of courts with the Cayman Islands and many other countries and regions. Therefore,
+recognition and enforcement in Hong Kong of judgments of a court in any of these non-Hong Kong jurisdictions in relation to any matter
+not subject to a binding arbitration provision may be difficult or impossible.
+
+ 
+
+Shareholder
+claims that are common in the United States, including securities law class actions and fraud claims, generally are difficult to pursue
+as a matter of law or practicality in Hong Kong. Although the local regulators in Hong Kong may establish a regulatory cooperation mechanism
+with the securities regulators of another country or region to implement cross-border supervision and administration, such regulatory
+cooperation with the securities regulators in the United States have not been efficient in the absence of mutual and practical cooperation
+mechanisms. According to Article 177 of the PRC Securities Law which took effect in March 2020, no overseas securities regulator is allowed
+to directly conduct investigation or evidence collection activities within the territory of the PRC. Accordingly, without the consent
+of the relevant PRC or Hong Kong securities regulators and relevant regulators, no organization or individual may provide the documents
+and materials relating to securities business activities to overseas parties.
+
+ 
+
+ 41
+
+ 
+
+ 
+
+ 
+
+For
+further information on the relevant laws of the Cayman Islands and Hong Kong, see "Enforceability of Civil Liabilities."
+As a result of all of the above, our shareholders may have more difficulties in protecting their interests through actions against us
+or our officers, directors or major shareholders than would shareholders of a corporation incorporated in a jurisdiction in the United
+States.
+
+ 
+
+Our
+Ordinary Shares may be subject to raid and substantial price volatility unrelated to our performance, which could result in substantial
+losses to investors.
+
+ 
+
+Our
+Class A Ordinary Shares may be subject to rapid and substantial price volatility and their trading price could fluctuate widely due to
+factors beyond our control. Upon the consummation of this offering, we will have a relatively small public float due to the relatively
+small size of this offering, and the concentrated ownership of our Class A Ordinary Shares among our executive officers and directors.
+As a result of our small public float, our Class A Ordinary Shares may be less liquid and have greater stock price volatility than the
+shares of companies with broader public ownership. This may also happen because of the broad market and industry factors, like the performance
+and fluctuation of the market prices of other companies with business operations located mainly in the PRC that may have listed their
+securities in the United States. In addition to market and industry factors, the price and trading volume for our Class A Ordinary Shares
+may be highly volatile for factors specific to our operations, including the following:
+
+ 
+
+ 
+ 
+ 
+ fluctuations
+ in our revenues, earnings, and cash flow;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ changes
+ in financial estimates by securities analysts;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ additions
+ or departures of key personnel;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ release
+ of lock-up or other transfer restrictions on our outstanding equity securities or sales of additional equity securities; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ potential
+ litigation or regulatory investigations.
+
+ 
+ 
+
+Any
+of these factors may result in significant and sudden changes in the volume and price at which our shares will trade.
+
+ 
+
+In
+addition, the stock price of a number of companies involved in initial public offerings, particularly among companies with relatively
+smaller public floats, has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the
+operating performance of these companies. Such rapid and substantial price volatility, including any stock run-up, may be unrelated to
+our actual or expected operating performance and financial condition or prospects, making it difficult for prospective investors to assess
+the rapidly changing value of our stock. This volatility may prevent you from being able to sell your securities at or above the price
+you paid for your securities. If the market price of our Class A Ordinary Shares after this offering does not exceed the initial public
+offering price, you may not realize any return on your investment in us and may lose some or all of your investment.
+
+ 
+
+Furthermore,
+in the past, shareholders of public companies have often brought securities class action suits against those companies following periods
+of instability in the market price of their securities. If we were involved in a class action suit, it could divert a significant amount
+of our management s attention and other resources from our business and operations and require us to incur significant expenses
+to defend the suit, which could harm our results of operations. Any such class action suit, whether or not successful, could harm our
+reputation and restrict our ability to raise capital in the future. In addition, if a claim is successfully made against us, we may be
+required to pay significant damages, which could have a material adverse effect on our financial condition and results of operations.
+
+ 
+
+ 42
+
+ 
+
+ 
+
+ 
+
+If
+we are classified as a passive foreign investment company, United States taxpayers who own our securities may have adverse United States
+federal income tax consequences.
+
+ 
+
+We
+are a non-U.S. corporation and, as such, we will be classified as a passive foreign investment company, which is known as a PFIC, for
+any taxable year if, for such year, either
+
+ 
+
+ 
+ 
+ 
+ At
+ least 75% of our gross income for the year is passive income; or
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ average percentage of our assets (determined at the end of each quarter) during the taxable year that produce passive income or that
+ are held for the production of passive income is at least 50%.
+
+ 
+ 
+
+Passive
+income generally includes dividends, interest, rents, royalties (other than rents or royalties derived from the active conduct of a trade
+or business) and gains from the disposition of passive assets.
+
+ 
+
+If
+we are determined to be a PFIC for any taxable year (or portion thereof) that is included in the holding period of a U.S. taxpayer who
+holds our securities, the U.S. taxpayer may be subject to increased U.S. federal income tax liability and may be subject to additional
+reporting requirements.
+
+ 
+
+It
+is possible that, for our current taxable year or for any subsequent year, more than 50% of our assets may be assets which produce passive
+income. We will make this determination following the end of any particular tax year. We treat our affiliated entities as being owned
+by us for United States federal income tax purposes, not only because we exercise effective control over the operation of such entities
+but also because we are entitled to substantially all of their economic benefits, and, as a result, we consolidate their operating results
+in our consolidated financial statements. For purposes of the PFIC analysis, in general, a non-U.S. corporation is deemed to own its
+pro rata share of the gross income and assets of any entity in which it is considered to own at least 25% of the equity by value.
+
+ 
+
+For
+further information on the application of the PFIC rules to us and the consequences to U.S. taxpayers if we were determined to be a PFIC,
+see "Material Tax Considerations - United States Federal Income Tax Considerations - Passive Foreign Investment Company Considerations."
+
+ 
+
+We
+are an emerging growth company within the meaning of the Securities Act and may take advantage of certain reduced reporting requirements.
+
+ 
+
+We
+are an "emerging growth company," as defined in the JOBS Act, and we may take advantage of certain exemptions from various
+requirements applicable to other public companies that are not emerging growth companies including, most significantly, not being required
+to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act for so long as we are an emerging growth
+company. As a result, if we elect not to comply with such auditor attestation requirements, our investors may not have access to certain
+information they may deem important.
+
+ 
+
+The
+JOBS Act also provides that an emerging growth company does not need to comply with any new or revised financial accounting standards
+until such date that a private company is otherwise required to comply with such new or revised accounting standards. In other words,
+an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise
+apply to private companies. We have elected to take advantage of the extended transition period, although we have early adopted certain
+new and revised accounting standards based on transition guidance permitted under such standards. As a result of this election, our future
+financial statements may not be comparable to other public companies that comply with the public company effective dates for these new
+or revised accounting standards.
+
+ 
+
+Our
+Controlling Shareholder has substantial influence over the Company. His interests may not be aligned with the interests of our other
+shareholders, and it could present or cause a change of control or other transactions.
+
+ 
+
+Prior
+to this offering, through his 99% ownership of MCL, Mr. Ng Hon Kin, our chairman and executive director, beneficially owns 65% of our
+issued and outstanding Ordinary Shares. Upon completion of this offering, our Controlling Shareholder s beneficial ownership will
+decrease to 57.86%, and our public shareholders will beneficially own 10.99% of our issued and outstanding Ordinary Shares assuming
+the underwriters do not exercise their over-allotment option. In the event the underwriters exercise their over-allotment option in full,
+our Controlling Shareholder will own 56.92% of our issued and outstanding Ordinary Shares.
+
+ 
+
+ 43
+
+ 
+
+ 
+
+ 
+
+Accordingly,
+our Controlling Shareholder could control the outcome of any corporate transaction or other matter submitted to the shareholders for
+approval, including mergers, consolidations, the election of directors and other significant corporate actions, including the power to
+prevent or cause a change in control. The interests of our largest shareholder may differ from the interests of our other shareholders.
+Without the consent of our controlling shareholder, we may be prevented from entering into transactions that could be beneficial to us
+or our other shareholders. The concentration in the ownership of our shares may cause a material decline in the value of our shares.
+For further information on our principal shareholders and their affiliated entities, see "Principal Shareholders."
+
+ 
+
+If
+securities or industry analysts do not publish research or reports about our business, or if they adversely change their recommendations
+regarding our Class A Ordinary Shares, the market price for our Class A Ordinary Shares and trading volume could decline.
+
+ 
+
+The
+trading market for our Class A Ordinary Shares will be influenced by research or reports that industry or securities analysts publish
+about our business. If one or more analysts downgrade our Class A Ordinary Shares, the market price for our Class A Ordinary Shares would
+likely decline. If one or more of these analysts cease to cover us or fail to regularly publish reports on us, we could lose visibility
+in the financial markets, which in turn. could cause the market price or trading volume for our Class A Ordinary Shares to decline.
+
+ 
+
+The
+sale or availability for sale of substantial amounts of our Class A Ordinary Shares could adversely affect their market price.
+
+ 
+
+Sales
+of substantial amounts of our Class A Ordinary Shares in the public market after the completion of this offering, or the perception that
+these sales could occur, could adversely affect the market price of our Class A Ordinary Shares, and could materially impair our ability
+to raise capital through equity offerings in the future. Prior to the sale of our Class A Ordinary Shares in this offering, we have 27,000,000
+Ordinary Shares, consist of 9,450,000 Class A Ordinary Shares and 17,550,000 Class B Ordinary Shares, issued and outstanding. The Class
+A Ordinary Shares sold in this offering will be freely tradable without restriction or further registration under the Securities Act,
+and Class A Ordinary Shares held by our existing shareholders may also be sold in the public market in the future, subject to the restrictions
+in Rule 144 and Rule 701 under the Securities Act and applicable lock-up agreements. There will be 30,333,333 Ordinary Shares, consist
+of 12,783,333 Class A Ordinary Shares and 13,283,333 Class B Ordinary Shares, outstanding immediately after this offering and prior
+to the sale of any Resale Shares, subject to approval of resale prospectus. In connection with this offering, our directors and officers
+named in the section "Management" and certain shareholders have agreed not to sell any Ordinary Shares until 180 days
+after the date of this prospectus without the prior written consent of the representative of the underwriters, subject to certain exceptions
+including the sale of up to 4,272,222 Class A Ordinary Shares pursuant to the Resale Prospectus. However, the underwriters may release
+these securities from these restrictions at any time. We cannot predict what effect, if any, market sales of securities held by our controlling
+shareholder or any other shareholder or the availability of these securities for future sale will have on the market price of our Class
+A Ordinary Shares. For a more detailed description of the restrictions on selling our Class A Ordinary Shares after the offering, see
+"Shares Eligible for Future Sale" and "Underwriting".
+
+ 
+
+Short
+selling may drive down the market price of our Class A Ordinary Shares.
+
+ 
+
+Short
+selling is the practice of selling shares that the seller does not own but rather has borrowed from a third party with the intention
+of buying identical shares back at a later date to return to the lender. The short seller hopes to profit from a decline in the value
+of the shares between the sale of the borrowed shares and the purchase of the replacement shares, as the short seller expects to pay
+less in that purchase than it received in the sale. As it is in the short seller s interest for the price of the shares to decline,
+many short sellers publish, or arrange for the publication of, negative opinions and allegations regarding the relevant issuer and its
+business prospects in order to create negative market momentum and generate profits for themselves after selling the shares short. These
+short attacks have, in the past, led to the selling of shares in the market. If we were to become the subject of any unfavorable publicity,
+whether such allegations are proven to be true or untrue, we could have to expend a significant amount of resources to investigate such
+allegations and/or defend ourselves. While we would strongly defend against any such short seller attacks, we may be constrained in the
+manner in which we can proceed against the relevant short seller by principles of freedom of speech, applicable state law or issues of
+commercial confidentiality.
+
+ 
+
+ 44
+
+ 
+
+ 
+
+ 
+
+You
+must rely on the judgment of our management as to the uses of the net proceeds from this offering, and such uses may not produce income
+or increase our share price.
+
+ 
+
+We
+plan to use the net proceeds of this offering primarily as follows: (i) approximately 5% to set up our research and development capacity;
+(ii) approximately 25% to penetrate and further expand into new and existing geographical markets; (iii) approximately 65% for general
+working capital and other general corporate purposes; and (iv) approximately 5% for advisory fee payment. For further information,
+see "Use of Proceeds" on page 48.
+
+ 
+
+The
+statement by the SEC regarding proposed rule changes submitted by Nasdaq and an act passed by the U.S. Senate and the U.S. House of Representatives
+all call for additional and more stringent criteria to be applied to emerging market companies. These developments could add uncertainties
+to our offering, business operations, share price and reputation.
+
+ 
+
+U.S.
+public companies that have substantially all of their operations in China (including in Hong Kong) have been the subject of intense scrutiny,
+criticism, and negative publicity by investors, financial commentators, and regulators, such as the SEC. Much of the scrutiny, criticism
+and negative publicity has centered on financial and accounting irregularities and mistakes, a lack of effective internal controls over
+financial accounting, inadequate corporate governance policies or a lack of adherence thereto and, in many cases, allegations of fraud.
+
+ 
+
+On
+December 7, 2018, the SEC and the PCAOB issued a joint statement highlighting continued challenges faced by the U.S. regulators in their
+oversight of financial statement audits of U.S.-listed companies with significant operations in China. On April 21, 2020, SEC Chairman
+Jay Clayton and PCAOB Chairman William D. Duhnke III, along with other senior SEC staff, released a joint statement highlighting the
+risks associated with investing in companies based in or have substantial operations in emerging markets including China, reiterating
+past SEC and PCAOB statements on matters including the difficulty associated with inspecting accounting firms and audit work papers in
+China and higher risks of fraud in emerging markets and the difficulty of bringing and enforcing SEC, Department of Justice and other
+U.S. regulatory actions, including in instances of fraud, in emerging markets generally.
+
+ 
+
+On
+May 20, 2020, the U.S. Senate passed the HFCAA requiring a foreign company to certify it is not owned or controlled by a foreign government
+if the PCAOB is unable to audit specified reports because the company uses a foreign auditor not subject to PCAOB inspection. If the
+PCAOB is unable to inspect the company s auditors for three consecutive years, the issuer s securities are prohibited to
+trade on a national exchange. On December 2, 2020, the U.S. House of Representatives approved the HFCAA.
+
+ 
+
+On
+May 21, 2021, Nasdaq filed three proposals with the SEC to (i) apply minimum offering size requirement for companies primarily operating
+in a "Restrictive Market"; (ii) prohibit Restrictive Market companies from directly listing on Nasdaq Capital Market, and
+only permit them to list on Nasdaq Global Select or Nasdaq Global Market in connection with a direct listing; and (iii) apply additional
+and more stringent criteria to an applicant or listed company based on the qualifications of the company s auditors.
+
+ 
+
+As
+more stringent criteria may be imposed, including the HFCAA, which became law in December 2020, our Ordinary Shares may be prohibited
+from trading if our auditor cannot be fully inspected. The PCAOB issued the Determination Report on December 16, 2021, which found that
+the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in: (1) mainland China of the
+PRC because of a position taken by one or more regulators in mainland China; and (2) Hong Kong, a Special Administrative Region and dependency
+of the PRC, because of a position taken by one or more regulators in Hong Kong. In addition, the Determination Report identified the
+specific registered public accounting firms subject to these determinations which included our auditor who appears as part of the report
+and is listed under its Appendix B: Registered Public Accounting Firms Subject to the Hong Kong Determination.
+
+ 
+
+On
+December 15, 2022, the PCAOB announced that it has secured complete access to inspect and investigate registered public accounting firms
+headquartered in mainland China and Hong Kong and voted to vacate the previous 2021 Determination Report to the contrary.
+
+ 
+
+The
+HFCAA prohibits foreign companies from listing their securities on U.S. stock exchanges if the company s auditor has been unavailable
+for PCAOB inspection or investigation for three consecutive years and, as a result, an exchange may determine to delist our Class A Ordinary
+Shares. In June 2021, the Senate passed the AHFCAA, and was enacted on December 22, 2022, which reduces the time period for the delisting
+of foreign companies under the HFCAA to two consecutive years instead of three years. In the event that the HFCAA is amended to prohibit
+an issuer s securities from trading on any U.S. stock exchange and our auditor is not subject to PCAOB inspections for two consecutive
+years instead of three, it will reduce the time before our Class A Ordinary Shares may be prohibited from trading or delisted from an
+exchange.
+
+ 
+
+As
+a result of this scrutiny, criticism and negative publicity, the publicly traded stocks of many U.S. listed Chinese companies sharply
+decreased in value and, in some cases, has become virtually worthless. Many of these companies are now subject to shareholder lawsuits
+and SEC enforcement actions and are conducting internal and external investigations into the allegations. It is not clear what effect
+this sector-wide scrutiny, criticism and negative publicity will have on us, our offering, business, and our Class A Ordinary Share price.
+If we become the subject of any unfavorable allegations, whether such allegations are proven to be true or untrue, we will have to expend
+significant resources to investigate such allegations and/or defend our Company. This situation will be costly and time consuming and
+distract our management from furthering our growth. If such allegations are not proven to be groundless, we and our business operations
+will be severely affected, and you could sustain a significant decline in the value of our Class A Ordinary Shares.
+
+ 
+
+ 45
+
+ 
+
+ 
+
+ 
+
+ENFORCEABILITY
+OF CIVIL LIABILITIES
+
+ 
+
+Our
+Company is an exempted company incorporated with limited liability under the laws of the Cayman Islands. We are incorporated in the Cayman
+Islands because of certain benefits associated with being a Cayman Islands company, such as political and economic stability, an effective
+judicial system, a favorable tax system, the absence of foreign exchange control or currency restrictions and the availability of professional
+and support services. However, the Cayman Islands has a less developed body of securities laws as compared to the U.S. and these securities
+laws provide less protection for investors. In addition, Cayman Islands companies may not have standing to sue before the U.S. federal
+courts.
+
+ 
+
+Our
+constitutional documents do not contain provisions requiring that disputes, including those arising under the securities laws of the
+United States, among us, our officers, directors and shareholders, be arbitrated. All of our subsidiaries current operations
+are conducted outside of the United States, and all of our current assets are located outside of the United States, with the majority
+of our and our operations and current assets being located in Hong Kong. In addition, our auditors are located in Diamond Bar, California,
+and our directors and officers , except for one independent non-executive director who will commence his term immediately prior to the
+completion of this offering, reside primarily in Hong Kong and are majorly China (Hong Kong) nationals. As a result, it may be difficult
+for our shareholders to effect service of process upon us or those persons. In addition, Hong Kong has no treaties providing for the
+reciprocal recognition and enforcement of judgments of courts within the Cayman Islands. Therefore, recognition and enforcement in Hong
+Kong of judgments of a court in non-Hong Kong jurisdictions in relation to any matter not subject to a binding arbitration provision
+may be difficult or impossible.
+
+ 
+
+Shareholder
+claims that are common in the United States, including securities law class actions and fraud claims, generally are difficult to pursue
+as a matter of law or practicality in Hong Kong. Although the local regulators in Hong Kong may establish a regulatory cooperation mechanism
+with the securities regulators of another country or region to implement cross-border supervision and administration, such regulatory
+cooperation with the securities regulators in the United States have not been efficient in the absence of a mutual and practical cooperation
+mechanism. According to Article 177 of the PRC Securities Law, which took effect in March 2020, no overseas securities regulator is allowed
+to directly conduct investigation or evidence collection activities within the territory of the PRC. Accordingly, without the consent
+of the competent PRC or Hong Kong securities regulators and relevant regulators, no organization or individual may provide the documents
+and materials relating to securities business activities to overseas parties.
+
+ 
+
+We
+have appointed Cogency Global Inc., 122 E. 42nd Street, 18th Floor, New York, New York 10168 as our agent upon
+whom process may be served in any action brought against us under the securities laws of the United States.
+
+ 
+
+ 46
+
+ 
+
+ 
+
+ 
+
+Cayman
+Islands
+
+ 
+
+We have been advised
+by Ogier, our legal counsel as to Cayman Islands laws that although the courts
+of the Cayman Islands will in certain circumstances recognize and enforce a foreign judgment, without any re-examination or re-litigation
+of matters adjudicated upon, provided such judgment:
+
+ 
+
+ 
+(a)is given by a foreign court of competent jurisdiction;
+
+ 
+
+ 
+(b)imposes on the judgment debtor a liability to
+ pay a liquidated sum for which the judgment has been given;
+
+ 
+
+ 
+(c)is final;
+
+ 
+
+ 
+(d)is not in respect of taxes, a fine or a penalty;
+
+ 
+
+ 
+(e)was not obtained by fraud; and
+
+ 
+
+ 
+(f)is not of a kind the enforcement of which is
+ contrary to natural justice or the public policy of the Cayman Islands.
+
+ 
+
+Subject
+to the above limitations, in appropriate circumstances, a Cayman Islands court may give effect in the Cayman Islands to other kinds of
+final foreign judgments such as declaratory orders, orders for performance of contracts and injunctions.
+
+ 
+
+Hong
+Kong
+
+ 
+
+There
+is uncertainty as to whether the courts of Hong Kong would: (i) recognize or enforce judgments of United States courts obtained against
+us or our directors or officers predicated upon the civil liability provisions of the securities laws of the United States or any state
+in the United States; or (ii) entertain original actions brought in Hong Kong against us or our directors or officers predicated upon
+the securities laws of the United States or any state in the United States.
+
+ 
+
+A
+judgment of a court in the United States predicated upon U.S. federal or state securities laws may be enforced in Hong Kong at common
+law by bringing an action in a Hong Kong court on that judgment for the amount due thereunder, and then seeking summary judgment on the
+strength of the foreign judgment, provided that the foreign judgment, among other things, is: (i) for a debt or a definite sum of money
+(not being taxes or similar charges to a foreign government taxing authority or a fine or other penalty); and (ii) final and conclusive
+on the merits of the claim, but not otherwise. Such a judgment may not, in any event, be so enforced in Hong Kong if (a) it was obtained
+by fraud; (b) the proceedings in which the judgment was obtained were opposed to natural justice; (c) its enforcement or recognition
+would be contrary to the public policy of Hong Kong; (d) the court of the United States was not jurisdictionally competent; or (e) the
+judgment was in conflict with a prior Hong Kong judgment.
+
+ 
+
+Hong
+Kong has no arrangement for the reciprocal enforcement of judgments with the United States. As a result, there is uncertainty as to the
+enforceability in Hong Kong, in original actions or in actions for enforcement, of judgments of United States courts of civil liabilities
+predicated solely upon the federal securities laws of the United States or the securities laws of any State or territory within the United
+States.
+
+ 
+
+ 47
+
+ 
+
+ 
+
+ 
+
+USE
+OF PROCEEDS
+
+ 
+
+If
+the underwriters do not exercise their over-allotment option, we expect to receive US$12,600,000 of net proceeds from this offering,
+based on the public offering price of US$4.5 per share, after deducting underwriting discounts and commissions of US$900,000,
+a non-accountable expense allowance to the underwriters of US$150,000 and estimated offering expenses of US$1,500,000 payable by
+us. If the underwriters exercise their over-allotment option in full, we expect to receive US$14,700,000 of net proceeds from
+this offering after deducting underwriting discounts and commissions of US$1,558,750, a non-accountable expense allowance to the underwriters
+of US$150,000 and estimated offering expenses of US$1,500,000 including advisory fees of US$100,000 up to US$400,000
+(for which US$100,000 was previously paid).
+
+ 
+
+We
+currently intend to use the net proceeds received from this offering primarily as follows:
+
+ 
+
+ 
+ 
+ 
+ approximately
+ 5% to set up our research and development capacity;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ approximately
+ 25% to penetrate and further expand into new and existing geographical markets;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ approximately
+ 65% for general working capital and other general corporate purposes; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ approximately
+ 5% as advisory fee payment.
+
+ 
+ 
+
+The
+foregoing represents our current intentions based on our present plans and business conditions to use and allocate the net proceeds of
+this offering. Management, however, will have significant flexibility and discretion to apply the net proceeds of this offering. To the
+extent that the net proceeds we receive from this offering are not immediately used for the above purposes, we intend to invest our net
+proceeds in short-term, interest-bearing bank deposits or debt instruments.
+
+ 
+
+Set
+up our research and development capability.
+
+ 
+
+We
+intend to set up our own research and development facilities. By allocating 5% of the net proceeds in setting up new research and development
+for our medical cosmetology technologies, services and products, we will be able to offer our own branded products.
+
+ 
+
+Penetrate
+and further expand into new and existing geographical markets.
+
+ 
+
+For
+the purpose of penetration and further expansion into new and existing geographical markets, we plan to allocate 25% of the net proceeds
+to establish new subsidiary or representative offices and enhancing our sales and marketing efforts in new or existing geographical markets
+such as U.S. to enhance our sales and service support for our customers. With the establishment of a subsidiary or representative offices
+in a new or existing geographical market, we believe that we could (i) strengthen our services and marketing support to our existing
+customer potential customers; and (ii) explore opportunities to seek new customers, thereby capturing new sales opportunities and expanding
+our market share.
+
+ 
+
+General
+working capital.
+
+ 
+
+We
+intend to reserve 65% of the net proceeds for general working capital needs and daily operational needs. This will serve as a buffer
+to deal with the fluctuating economic environment while providing a stable financial backup for daily operational use.
+
+ 
+
+ 48
+
+ 
+
+ 
+
+ 
+
+CAPITALIZATION
+
+ 
+
+The
+following table sets forth our capitalization as of December 31, 2024:
+
+ 
+
+ 
+ 
+ 
+ on
+ an actual basis; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ on
+ a pro forma as adjusted basis to reflect (i) the above; (ii) the issuance and sale of 3,333,333 Class A Ordinary Shares by us in
+ this offering based on the offering price of US$4.5 per Class A Ordinary Share, assuming the underwriters do not exercise the over-allotment
+ option, after deducting
+ underwriting discounts and commissions, a non-accountable expense allowance and estimated offering expenses payable by us.
+
+ 
+ 
+
+The
+pro forma as adjusted information below is illustrative only, and our capitalization following the completion of this offering is subject
+to adjustment based on the actual net proceeds to us from the offering. You should read this table in conjunction with "Use
+of Proceeds", "Selected Consolidated Financial and Other Data", "Management s Discussion
+and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and related notes
+included elsewhere in this prospectus.
+
+ 
+
+ 
+ 
+ 
+ As of December 31, 2024
+ 
+
+ 
+ 
+ 
+ Actual
+ 
+ 
+ As adjusted (1)
+ 
+ 
+
+ 
+ 
+ 
+ USD 000
+ 
+ 
+ USD 000
+ 
+ 
+
+ 
+ Cash and cash equivalents
+ 
+ $
+ 4
+ 
+ 
+ $
+ 12,623
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Indebtedness
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Bank borrowings
+ 
+ $
+ 871
+ 
+ 
+ $
+ 871
+ 
+ 
+
+ 
+ Amounts due to related parties
+ 
+ 
+ 1,175
+ 
+ 
+ 
+ 1,175
+ 
+ 
+
+ 
+ 
+ 
+ $
+ 2,046
+ 
+ 
+ $
+ 2,046
+ 
+ 
+
+ 
+ Shareholders Equity
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Class A Ordinary Shares, par value US$0.0001 per share; 85,000,000 shares authorized; 9,450,000 issued and outstanding on an
+ actual basis, 13,005,555 Class A Ordinary Shares outstanding on an as adjusted basis (assuming 3,333,333 Class A Ordinary Shares
+ to be issued in this offering with no exercise of over-allotment option and resale of 222,222 Class A Ordinary Shares) 
+ 
+ 
+ 1
+ 
+ 
+ 
+ 1
+ 
+ 
+
+ 
+ Class B Ordinary Shares, par value US$0.0001 per share; 25,000,000 shares authorized; 17,550,000 shares issued and outstanding
+ on an actual basis; 17,327,778 outstanding on an as adjusted basis (assuming resale of 222,222 Class A Ordinary Shares)
+ 
+ 
+ 2
+ 
+ 
+ 
+ 2
+ 
+ 
+
+ 
+ Additional paid-in capital
+ 
+ 
+ 2,317
+ 
+ 
+ 
+ 14,936
+ 
+ 
+
+ 
+ Accumulated deficits
+ 
+ 
+ (10,365
+ )
+ 
+ 
+ (10,365
+ )
+ 
+
+ 
+ Accumulated other comprehensive income
+ 
+ 
+ (24
+ )
+ 
+ 
+ (24
+ )
+ 
+
+ 
+ Total Equity
+ 
+ 
+ (8,069
+ )
+ 
+ 
+ 4,550
+ 
+ 
+
+ 
+ Total Capitalization
+ 
+ $
+ (6,023
+ )
+ 
+ $
+ 6,596
+ 
+ 
+
+ 
+ 
+
+ 
+ (1)
+ Assuming
+ no exercise of the underwriters over-allotment option
+
+ 
+ 
+
+ 49
+
+ 
+
+ 
+
+ 
+
+DIVIDENDS
+AND DIVIDEND POLICY
+
+ 
+
+For
+the six months ended December 31, 2024 and 2023, and the fiscal years ended June 30, 2024 and 2023, no dividend was declared.
+
+ 
+
+Any
+future dividend payments should not be considered as a guarantee or indication that those companies will declare and pay dividends in
+such manner in the future or at all. Further, as of the date of this prospectus, our board of directors does not intend to pay any dividends
+on our Ordinary Shares for the foreseeable future. We anticipate that all of our net earnings, if any, will be used for the operation
+and growth of our business, which is conducted through our subsidiaries.
+
+ 
+
+We
+have adopted a dividend policy, according to which our board of directors shall take into account, among other things, the following
+factors when deciding whether to propose a dividend and in determining the dividend amount: (a) operating and financial results; (b)
+cash flow situation; (c) business conditions and strategies; (d) future operations and earnings; (e) taxation considerations; (f) interim
+dividend paid, if any; (g) capital requirement and expenditure plans; (h) interests of shareholders; (i) statutory and regulatory restrictions;
+(j) any restrictions on payment of dividends; and (k) any other factors that our board of directors may consider relevant. Our board
+of directors has complete discretion in deciding whether to distribute dividends, subject to certain restrictions under the Cayman Islands
+law, namely that our Company may only pay dividends out of profits or share premium, and provided always that in no circumstances may
+a dividend be paid if this would result in our Company being unable to pay its debts as they fall due in the ordinary course of business.
+In addition, our shareholders may by ordinary resolution declare a dividend, but no dividend may exceed the amount recommended by our
+board of directors.
+
+ 
+
+Even
+if our board of directors decides to pay dividends, the timing, form, and amount of future dividends, if any, will depend upon our future
+results of operations and cash flow, capital requirements and surplus, general financial condition, contractual restrictions, and other
+factors that the board of directors may deem relevant. In addition, we are a holding company and depend on the receipt of dividends and
+other distributions from our subsidiaries to pay dividends on our Ordinary Shares.
+
+ 
+
+DILUTION
+
+ 
+
+Investors
+purchasing our Class A Ordinary Shares in this offering will experience immediate and substantial dilution in the pro forma as adjusted
+net tangible book value of their Ordinary Shares. Dilution in pro forma as adjusted net tangible book value represents the difference
+between the initial public offering price of our Class A Ordinary Shares and the pro forma as adjusted net tangible book value per share
+of our Class A Ordinary Shares immediately after the offering.
+
+ 
+
+Historical
+net tangible book value per share represents our total tangible assets (total assets excluding goodwill and other intangible assets,
+net) less total liabilities, divided by the number of outstanding Ordinary Shares. After giving effect to the sale of Class A
+Ordinary Shares in this offering by the Company based on the offering price of US$4.5 per Class A Ordinary Share, after deducting
+US$900,000 in underwriting discounts and commissions (assuming 3,333,333 Class A Ordinary Shares to be issued in this offering with
+no exercise of over-allotment option), a non-accountable expense allowance to the underwriters of US$150,000 and estimated offering
+expenses payable by us of US$1,300,000, the pro forma as adjusted net tangible book value as of December 31, 2024 would have
+been approximately US$4,550,000, or US$0.15 per Ordinary Share. This represents an immediate increase in pro forma
+as adjusted net tangible book value of US$0.46 per Ordinary Share to our existing stockholders and an immediate dilution
+of US$4.35 per share to new investors purchasing Ordinary Shares in this offering.
+
+ 
+
+The
+following table illustrates this dilution on a per Ordinary Share basis to new investors.
+
+ 
+
+ 
+ 
+ US$ 
+ 
+
+ 
+ Assumed
+ initial public offering price per Class A Ordinary
+ Share 
+ 4.50 
+ 
+
+ 
+ Historical
+ net tangible book value per Ordinary Share as of December 31, 2024 
+ (0.31)
+ 
+
+ 
+ Increase
+ in as adjusted net tangible book value per Ordinary Share attributable to the investors in this offering(1)
+ 
+ 0.46 
+ 
+
+ 
+ Pro
+ forma net tangible book value per Ordinary Share after giving effect to this offering 
+ 0.15 
+ 
+
+ 
+ Dilution
+ per share to new investors participating in this offering 
+ 4.35
+ 
+
+ 
+
+ 
+
+ 
+ (1)
+ Assumes
+ gross proceeds from the offering of 3,333,333 Class A Ordinary Shares and assumes that the underwriters over-allotment option
+ has not been exercised.
+
+ 
+ 
+
+ 50
+
+ 
+
+ 
+
+ 
+
+SELECTED
+CONSOLIDATED FINANCIAL AND OTHER DATA
+
+ 
+
+The
+following summarizes the consolidated statements of income and comprehensive income for the six months ended December 31, 2024 and 2023,
+the years ended June 30, 2024 and 2023, and the consolidated balance sheet as of December 31, 2024, June 30, 2024 and 2023 have been
+derived from our consolidated financial statements included elsewhere in this prospectus. The selected financial data set forth below
+should be read in conjunction with and are qualified by reference to "Management s Discussion and Analysis of Financial Condition
+and Results of Operations" and our consolidated financial statements and notes thereto included elsewhere in this prospectus. Our
+consolidated financial statements are prepared and presented in accordance with U.S. GAAP. Our historical results do not necessarily
+indicate results expected for any future period.
+
+ 
+
+CONSOLIDATED
+STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS)
+
+ 
+
+ 
+ 
+ For the six months ended December
+ 31, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ USD 
+ USD 
+
+ 
+ 
+ (Unaudited) 
+ (Unaudited) 
+
+ 
+ 
+ 
+ 
+
+ 
+ REVENUES, net 
+ $3,250,577 
+ $3,855,925 
+
+ 
+ 
+ 
+ 
+
+ 
+ COSTS AND EXPENSES 
+ 
+ 
+
+ 
+ Cost of revenue 
+ (658,466) 
+ (659,372)
+
+ 
+ Selling and marketing expenses 
+ (1,157,769) 
+ (1,660,311)
+
+ 
+ General and administrative expenses 
+ (482,351) 
+ (583,227)
+
+ 
+ 
+ 
+ 
+
+ 
+ INCOME FROM OPERATIONS 
+ $951,991 
+ $953,015 
+
+ 
+ 
+ 
+ 
+
+ 
+ OTHER INCOME (EXPENSES) 
+ 
+ 
+
+ 
+ Interest income 
+ $165 
+ $143 
+
+ 
+ Foreign exchange (loss) 
+ (96) 
+ 464 
+
+ 
+ Loss on disposal of fixed assets 
+ (185) 
+ (116,169)
+
+ 
+ Finance costs 
+ (16,323) 
+ (18,429)
+
+ 
+ Other income 
+ 46,370 
+ 76,582 
+
+ 
+ Total other (expenses) / income, net 
+ $29,931 
+ $(57,409)
+
+ 
+ 
+ 
+ 
+
+ 
+ INCOME BEFORE PROVISION FOR INCOME TAXES 
+ $981,922 
+ $895,606 
+
+ 
+ 
+ 
+ 
+
+ 
+ PROVISION FOR INCOME TAXES 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+
+ 
+ NET INCOME 
+ $981,922 
+ $895,606 
+
+ 
+ 
+ 
+ 
+
+ 
+ OTHER COMPREHENSIVE INCOME 
+ (44,660) 
+ (33,621)
+
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL COMPREHENSIVE INCOME 
+ $937,262 
+ $861,985 
+
+ 
+ 
+ 
+ 
+
+ 
+ Weighted average number of ordinary shares outstanding 
+ 
+ 
+
+ 
+ CLASS A - Basic and diluted 
+ 9,450,000 
+ 9,450,000 
+
+ 
+ CLASS B - Basic and diluted 
+ 17,550,000 
+ 17,550,000 
+
+ 
+
+ 
+
+CONSOLIDATED
+STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME (LOSS)
+
+(RESTATED)
+
+ 
+
+ 
+ 
+ For the years ended
+ June 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ USD 
+ USD 
+
+ 
+ 
+ 
+ 
+
+ 
+ REVENUES, net 
+ $6,111,388 
+ $8,022,480 
+
+ 
+ 
+ 
+ 
+
+ 
+ COSTS AND EXPENSES 
+ 
+ 
+
+ 
+ Cost of revenue 
+ (1,303,886) 
+ (1,646,315)
+
+ 
+ Selling and marketing expenses 
+ (2,960,063) 
+ (3,597,143)
+
+ 
+ General and administrative expenses 
+ (1,191,795) 
+ (976,609)
+
+ 
+ 
+ 
+ 
+
+ 
+ INCOME FROM OPERATIONS 
+ 655,644 
+ 1,802,413 
+
+ 
+ 
+ 
+ 
+
+ 
+ OTHER INCOME (EXPENSES) 
+ 
+ 
+
+ 
+ Interest income 
+ 351 
+ 147 
+
+ 
+ Foreign exchange (loss) 
+ 540 
+ (53)
+
+ 
+ Loss on disposal of fixed assets 
+ (116,695) 
+ (359)
+
+ 
+ Finance costs 
+ (35,244) 
+ (42,975)
+
+ 
+ Other income 
+ 103,082 
+ 141,102 
+
+ 
+ Total other (expenses) / income, net 
+ (47,966) 
+ 97,862 
+
+ 
+ 
+ 
+ 
+
+ 
+ INCOME BEFORE PROVISION FOR INCOME TAXES 
+ 607,678 
+ 1,900,275 
+
+ 
+ 
+ 
+ 
+
+ 
+ PROVISION FOR INCOME TAXES 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+
+ 
+ NET INCOME 
+ $607,678 
+ $1,900,275 
+
+ 
+ 
+ 
+ 
+
+ 
+ OTHER COMPREHENSIVE INCOME 
+ (38,348) 
+ 58,482 
+
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL COMPREHENSIVE INCOME 
+ $569,330 
+ $1,958,757 
+
+ 
+ 
+ 
+ 
+
+ 
+ Weighted average number of ordinary shares outstanding 
+ 
+ 
+
+ 
+ CLASS A - Basic and diluted 
+ 9,450,000 
+ 9,450,000 
+
+ 
+ CLASS B - Basic and diluted 
+ 17,550,000 
+ 17,550,000 
+
+ 
+ 
+
+ 51
+
+ 
+
+ 
+
+ 
+
+CONSOLIDATED
+BALANCE SHEETS
+
+ 
+
+ 
+ 
+ As of December 31, 
+ As of June 30, 
+
+ 
+ 
+ 2024 
+ 2024 
+ 2023 
+
+ 
+ 
+ USD 
+ USD 
+ USD 
+
+ 
+ 
+ (Unaudited) 
+ 
+ 
+
+ 
+ ASSETS 
+ 
+ 
+ 
+
+ 
+ CURRENT ASSETS 
+ 
+ 
+ 
+
+ 
+ Cash 
+ $ 3,875 
+ $85,798 
+ $54,932 
+
+ 
+ Accounts receivable 
+ 12,572 
+ 7,495 
+ 27,631 
+
+ 
+ Deposits 
+ 145,888 
+ 205,999 
+ 173,913 
+
+ 
+ Other receivables 
+ 4,794 
+ 4,700 
+ 4,445 
+
+ 
+ Prepayments 
+ 96,601 
+ 10,722 
+ 14,975 
+
+ 
+ Deferred sales commission 
+ 272,964 
+ 285,778 
+ 312,063 
+
+ 
+ Deferred offering costs 
+ 229,032 
+ 227,841 
+ - 
+
+ 
+ Amount due from related parties 
+ - 
+ - 
+ 46,968 
+
+ 
+ Total current assets 
+ $765,726 
+ $828,333 
+ $634,926 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ NON-CURRENT ASSETS 
+ 
+ 
+ 
+
+ 
+ Property and equipment, net 
+ $104,566 
+ $144,985 
+ $385,105 
+
+ 
+ Deposits 
+ 150,980 
+ 189,915 
+ 286,220 
+
+ 
+ Deferred sales commission 
+ 146,281 
+ 140,045 
+ 149,996 
+
+ 
+ Right-of-use assets – operating lease 
+ 1,293,616 
+ 520,506 
+ 1,546,648 
+
+ 
+ Right-of-use assets – financing lease 
+ 6,148 
+ 9,307 
+ 21,694 
+
+ 
+ Total non-current assets 
+ $1,701,591 
+ 1,004,758 
+ $2,389,663 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Total assets 
+ $2,467,317 
+ $1,833,091 
+ $3,024,589 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ LIABILITIES AND SHAREHOLDERS DEFICIT 
+ 
+ 
+ 
+
+ 
+ CURRENT LIABILITIES 
+ 
+ 
+ 
+
+ 
+ Bank borrowings 
+ $127,001 
+ $124,111 
+ $115,043 
+
+ 
+ Contract liabilities 
+ 5,317,888 
+ 7,032,566 
+ 9,426,113 
+
+ 
+ Accounts payable 
+ 89,588 
+ 43,979 
+ 57,084 
+
+ 
+ Accounts payable – related parties 
+ 4,448 
+ 4,213 
+ - 
+
+ 
+ Other payables and accruals 
+ 1,661,324 
+ 1,566,347 
+ 1,099,408 
+
+ 
+ Financing lease liabilities 
+ - 
+ - 
+ 2,946 
+
+ 
+ Operating lease liabilities 
+ 662,068 
+ 409,502 
+ 1,051,626 
+
+ 
+ Provision for reinstatement 
+ 41,108 
+ 100,797 
+ 107,631 
+
+ 
+ Amount due to related parties 
+ 1,175,464 
+ 576,336 
+ 152,648 
+
+ 
+ Total current liabilities 
+ $9,078,889 
+ $9,857,851 
+ $12,012,499 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ NON-CURRENT LIABILITIES 
+ 
+ 
+ 
+
+ 
+ Bank borrowings 
+ $744,391 
+ $805,732 
+ $926,521 
+
+ 
+ Financing lease liabilities 
+ - 
+ - 
+ - 
+
+ 
+ Operating lease liabilities 
+ 638,625 
+ 122,662 
+ 637,819 
+
+ 
+ Provision for reinstatement 
+ 74,660 
+ 53,355 
+ 61,590 
+
+ 
+ Total non-current liabilities 
+ $1,457,676 
+ $981,749 
+ $1,625,930 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Total liabilities 
+ $10,536,565 
+ $10,839,600 
+ $13,638,429 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ COMMITMENTS AND CONTINGENCIES 
+ $- 
+ $- 
+ $- 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ SHAREHOLDERS DEFICIT 
+ 
+ 
+ 
+
+ 
+ Class A Ordinary Shares, par value US$0.0001 per share; 85,000,000 shares authorized; 9,450,000
+ issued and outstanding as of June 30, 2024 and June 30, 2023 
+ $945 
+ $945 
+ $945 
+
+ 
+ Class B Ordinary Shares, par value US$0.0001 per share; 25,000,000 shares authorized; 17,550,000
+ shares issued and outstanding as of June 30, 2024 and June 30, 2023, respectively 
+ 1,755 
+ 1,755 
+ 1,755 
+
+ 
+ Additional paid-in capital 
+ 2,317,351 
+ 2,317,351 
+ 1,279,351 
+
+ 
+ Accumulated deficits 
+ (10,364,773) 
+ (11,346,695) 
+ (11,954,373)
+
+ 
+ Accumulated other comprehensive income 
+ (24,526) 
+ 20,134 
+ 58,482 
+
+ 
+ Total shareholders deficit 
+ $(8,069,248) 
+ $(9,006,510) 
+ $(10,613,840)
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Total liabilities and shareholders deficit 
+ $2,467,317 
+ $1,833,091 
+ $3,024,589 
+
+ 
+
+ 
+
+ 52
+
+ 
+
+ 
+
+ 
+
+MANAGEMENT S
+DISCUSSION AND ANALYSIS OF 
+
+FINANCIAL CONDITION AND RESULTS OF OPERATIONS
+
+ 
+
+The
+following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated
+financial statements and related notes included elsewhere in this prospectus. This discussion and analysis and other parts of this prospectus
+contain forward-looking statements based upon current beliefs, plans and expectations that involve risks, uncertainties, and assumptions.
+Our actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements
+as a result of several factors, including those set forth under "Risk Factors" and elsewhere in this prospectus. You should
+carefully read the "Risk Factors" section of this prospectus to gain an understanding of the important factors that could
+cause actual results to differ materially from our forward-looking statements.
+
+ 
+
+The
+Class A Ordinary Shares being offered in this prospectus are those of MEDG, or the Company. The Company is a holding company with no
+material operations of its own. We conduct our operations through GCHL, a Hong Kong company wholly owned by the Company. Unless the context
+requires otherwise, GCHL is the entity that contracts with third parties in the ordinary course of business, the holder of our business
+licenses and permits, and the legal owner of our business assets, other than our intellectual properties, which are registered under
+DCMCL, another Hong Kong company wholly owned by the Company.
+
+ 
+
+Overview
+
+ 
+
+We
+are a beauty and personal care service company offering a broad range of beauty and spa services for customers in Hong Kong under the
+brand name "Doctor s Concept". We offer both medical aesthetic services and normal beauty services. For the six months
+ended December 31, 2024 and 2023, our revenue was $3.25 million and $3.86 million, respectively, and our net income was $981,922 and
+$895,606, respectively. For the years ended June 30, 2024 and 2023, our revenue was $6.11 million and $8.02 million, respectively, and
+our net income was $607,678 and $1.90 million, respectively.
+
+ 
+
+Our
+services are customized to tailor to the needs of each customer and are priced and sold in the form of prepaid packages or single service.
+Based on our internal records without independent verification by our auditors or other third parties, as of December 31, 2024, approximately
+2,600 customers held one or more of our unexpired prepaid packages, of which mainly were repeat customers, having been served by us for
+more than three years.
+
+ 
+
+Our
+services are rendered through three service centers located in different regions of Hong Kong. Sales patterns are different among the
+three due to regional differences in household income, demographics and other factors. The three service centers have an aggregate gross
+floor area of 12,856 sq.ft, Our prepaid packages may be used in any of the three centers.
+
+ 
+
+Our
+results of operations since the termination of all COVID-19 pandemic measures in Hong Kong have not been satisfactory, and our financial
+condition has been exacerbated by operating cash outflow. They were mainly caused by three factors. First, as the general economic conditions
+in Hong Kong has remained weak during this period, consumers became more conservative in their discretionary spending. Second, we are
+facing competition from similar establishments in Shenzhen, China due to the depreciation of Renminbi, the currency of mainland China,
+against the Hong Kong dollar. Third, the emigration of local, middle-income families and professionals in the past few years has shrunk
+our target customer base. These were macroeconomic causes and did not reflect our competitiveness in the beauty personal care industry.
+Thus, we expect such operating results to be temporary and our profitability will grow as the city moves to its next economic cycle.
+
+ 
+
+ 53
+
+ 
+
+ 
+
+ 
+
+Key
+Factors Affecting Our Results of Operations
+
+ 
+
+Our
+results of operations and financial condition have been and will continue to be affected by the following major factors:
+
+ 
+
+ 
+ 
+ 
+ Macroeconomic
+ factors. Although we have plans to expand our operations by building our footprints in
+ other Asian countries, Hong Kong will remain our homebase. As medical aesthetic services
+ are elective healthcare procedures, our revenue will be strongly affected by macro-economic
+ factors such as changes in per capita disposable income, Hong Kong s economic outlook
+ and the number of medical tourists. The Hong Kong economy has been relatively weak in the
+ past 24 months. According to the US International Trade Association (ITA), the Hong Kong
+ cosmetics market in 2023 recorded a decrease of 38.6% from 2022. We expect consumers to be
+ more cautious with their spending in 2024. Consumers may opt to delay or forgo non-essential
+ spendings such as beauty services due to financial constraints.
+
+ 
+
+ 
+ 
+ 
+ Cost
+ and expense control. Hong Kong is a high-cost city. Employee compensation, rental payments
+ for our business premises and the related capital expenditure we made to furbish these premises,
+ such as decoration works and medical devices, are fixed overheads. We need to generate sufficient
+ revenue to cover these fixed costs in order to break even or become profitable. For cost
+ composition, employee compensation is the largest portion of our costs, representing 45.2%
+ and 41.9% of our costs of operations for the years ended June 30, 2024 and 2023. Given the
+ high portion of fixed costs in our costs of operations, our net profit will be affected substantially
+ by variance of our revenue.
+
+ 
+
+ 
+ 
+ 
+ Competition.
+ We intend to focus the growth of our medical aesthetic services. The cosmetology industry
+ in Hong Kong is highly competitive. Our competitors are primarily comprised of smaller, independent
+ aesthetic services operators and spa operators. We compete with these players, and the bigger
+ franchises for customers. Furthermore, personal-care and beauty alternatives with less sophisticated
+ technologies may appeal to our target customers on the basis of price alone. Our ability
+ to be effective across all such points of competition has and is likely to continue to have
+ a significant effect on our business, financial condition and results of operations.
+
+ 
+
+ 
+ 
+ 
+ Future
+ pandemics. The COVID-19 pandemic between March 2020 and March 2023 had a significant
+ adverse impact on the Hong Kong economy. We made a management decision to close down to 3
+ service centers in the year of 2022. Although the restrictive measures have been lifted since
+ March 2023, consumers need time to restore financial confidence before resuming spending
+ on non-essential services. The recovery has been particularly slow in retail spending, which
+ was exacerbated by a relatively weak Hong Kong economy.
+
+ 
+
+ 
+ 
+ 
+ Market
+ reputation. An established reputation for being a safe, reliable and quality service provider is our greatest marketing tool.
+ Our service quality is largely dependent upon our ability to attract and retain qualified beauty professionals, who also act as our
+ sales personnel. Quality is also reflected on our ability to master the know-hows, adapt to the constantly evolving technologies
+ and develop new services responsive to market trend.
+
+ 
+ 
+
+Key
+Components of Results of Operations
+
+ 
+
+Revenues
+
+ 
+
+We
+sell our services as prepaid packages customized to the needs of individual customers. Each prepaid package is issued with a number of
+credit points which the customer may apply towards one or multiple types of treatment on the terms set forth therein. Time of sales occurs
+when we issue the prepaid package to our customers. At the time of sales, payment received from the customer is recorded as deferred
+revenue, an asset; and our obligation to deliver the services is recorded as contract liabilities.
+
+ 
+
+When
+treatment is rendered, a portion of the deferred revenue is deducted from the package as treatment charges, the charges are recognized
+as revenue generated from such services. Most of our prepaid packages have a validity period of 24 months. When a prepaid package expires
+with unused credit, any deferred revenue remaining on our balance sheet will be recorded as forfeited revenue.
+
+ 
+
+We
+classify our services by their nature into two categories: medical aesthetic treatments and normal beauty treatments. Revenue recognized
+from our rendering of treatment services may be segregated using this classification. A significant portion of our prepaid packages,
+however, contain credits that may be applied towards our medical aesthetic and normal beauty treatments. Thus, forfeited revenue cannot
+be classified in the same manner. We also generate a very small portion of our revenue from the sale of beauty products and sundry items,
+which we classify as "others".
+
+ 
+
+During and
+after the COVID-19 pandemic, expired treatments have accounted for a substantial portion of our total revenue, representing 57.54% and
+42.98% of our total revenue for the years ended June 30, 2024 and 2023, respectively; and 66.71% and 62.76% of our total revenue for
+the six months ended December 31, 2024 and 2023, respectively. These expired treatments refer to prepaid service packages that our customers
+have not redeemed before their expiry dates. Our staff has been proactively reaching out to encourage customers to redeem their prepaid
+service packages, as this can keep our beauticians engaged and maintain an active customer base. Nonetheless, some customers still do
+not redeem their prepaid service packages, mainly due to the customers switching to service providers in mainland China. If the revenue
+from expired treatments decreases, we expect to see lower gross margin and lower revenue, which will lead to a slight decrease in our
+net profit; however, we believe this will not have a significant impact on us. With a view to reducing expired treatments, we need to
+continuously maintain customers interests and prevent them from switching to other service providers, and to do so, we plan to
+(i) acquire new equipment and medical aesthetic products, (ii) expand our marketing campaigns to promote our services; and (iii) introduce
+new service offerings.
+
+ 
+
+ 54
+
+ 
+
+ 
+
+ 
+
+The
+following table sets forth, for the periods indicated, revenue contribution from different sources.
+
+ 
+
+ 
+ 
+ For the six months ended December
+ 31, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ (Unaudited) 
+ (Unaudited) 
+
+ 
+ Medical aesthetic treatments 
+ $316,555 
+ $449,444 
+
+ 
+ Normal beauty treatments 
+ 764,017 
+ 984,935 
+
+ 
+ Expired treatments 
+ 2,168,542 
+ 2,419,949 
+
+ 
+ Others 
+ 1,463 
+ 1,597 
+
+ 
+ Total revenue 
+ $3,250,577 
+ $3,855,925 
+
+ 
+
+ 
+
+ 
+ 
+ For the years ended June 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ 
+ 
+
+ 
+ Medical aesthetic treatments 
+ $795,377 
+ $1,208,635 
+
+ 
+ Normal beauty treatments 
+ 1,793,789 
+ 3,345,837 
+
+ 
+ Expired treatments 
+ 3,516,607 
+ 3,448,177 
+
+ 
+ Others 
+ 5,615 
+ 19,831 
+
+ 
+ Total revenue 
+ $6,111,388 
+ $8,022,480 
+
+ 
+
+ 
+
+Costs
+and Expenses
+
+ 
+
+At
+the time of sales, we assume contract liabilities to the customer and an obligation to pay sales commissions to our staff who obtain
+the relevant contract. Instead of recording the full amount of the commissions as an expense upfront, the amount payable is recorded
+as deferred sales commissions, an asset, and this asset is amortized (expensed) over the validity period of the prepaid package when
+the associated revenue is recognized from the performance of our services. Other costs and expenses associated with the delivery of such
+services are also recorded as cost of revenue and the associated contract liability is considered settled.
+
+ 
+
+We
+classify our costs and expenses into three categories: cost of revenue, selling and marketing expenses, and general and administrative
+expenses.
+
+ 
+
+Our
+cost of revenue consists mainly of the cost of labor directly involved in providing treatments, fees charged by doctors whose services
+are rendered in connection with the treatments provided; and materials and other consumables used in such treatments. The following table
+sets forth, for the periods indicated, our cost of revenue attributable to different revenue sources:
+
+ 
+
+ 
+ 
+ For the six months ended December
+ 31, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ (Unaudited) 
+ (Unaudited) 
+
+ 
+ Medical aesthetic treatments 
+ $352,785 
+ $373,630 
+
+ 
+ Normal beauty treatments 
+ 301,421 
+ 283,877 
+
+ 
+ Others 
+ 4,260 
+ 1,865 
+
+ 
+ Total cost of revenue 
+ $658,466 
+ $659,372 
+
+ 
+
+ 
+
+ 
+ 
+ For the years ended June 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ Medical aesthetic treatments 
+ $722,894 
+ $853,440 
+
+ 
+ Normal beauty treatments 
+ 571,372 
+ 784,737 
+
+ 
+ Others 
+ 9,620 
+ 8,138 
+
+ 
+ Total cost of revenue 
+ $1,303,886 
+ $1,646,315 
+
+ 
+
+ 
+
+ 55
+
+ 
+
+ 
+
+ 
+
+Our
+selling and marketing expenses consist mainly of expenses incurred in the operations of our shops, including remuneration of the staff
+and professionals; depreciation of our treatment devices; and lease expenses and other overheads incurred to maintain the shops. Remuneration
+of the staff has two components: (a) base salaries and statutory pension contributions and market-standard benefits, and (b) sales commissions,
+which we categorize under "payroll, MPF and staff benefits".
+
+ 
+
+The
+following table sets forth, for the periods indicated, a breakdown of our selling and marketing expenses:
+
+ 
+
+ 
+ 
+ For the six months ended December
+ 31, 
+
+ 
+ 
+ 2024 
+ 2023 
+ Change 
+ Change 
+
+ 
+ 
+ USD 
+ USD 
+ USD 
+ % 
+
+ 
+ 
+ (Unaudited) 
+ 
+ 
+
+ 
+ Payroll, mandatory provident fund ("MPF") and staff benefits expense 
+ $420,743 
+ $529,490 
+ $(108,747) 
+ (20.54)
+
+ 
+ Rental, rates and property management expense 
+ 147,996 
+ 128,643 
+ 19,353 
+ 15.04 
+
+ 
+ Credit card commission 
+ 52,529 
+ 66,410 
+ (13,881) 
+ (20.90)
+
+ 
+ Depreciation – plant, property and equipment ("PPE") 
+ 39,767 
+ 127,037 
+ (87,270) 
+ (68.70)
+
+ 
+ Depreciation – right of use ("ROU") assets 
+ 3,200 
+ 7,423 
+ (4,223) 
+ (56.89)
+
+ 
+ Lease expenses 
+ 404,951 
+ 567,978 
+ (163,027) 
+ (28.70)
+
+ 
+ Advertising, marketing and promotion expense 
+ 36,619 
+ 166,570 
+ (129,951) 
+ (78.02)
+
+ 
+ Other expenses 
+ 51,964 
+ 66,760 
+ (14,796) 
+ (22.16)
+
+ 
+ Total 
+ $1,157,769 
+ $1,660,311 
+ $(502,542) 
+ (30.27)
+
+ 
+
+ 
+
+ 
+ 
+ For the years ended June 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+ Change 
+ Change 
+
+ 
+ 
+ USD 
+ USD 
+ USD 
+ % 
+
+ 
+ Payroll, MPF and staff benefits expense 
+ $963,944 
+ $1,307,366 
+ $(343,422) 
+ (26.27)
+
+ 
+ Rental, rates and property management expense 
+ 249,994 
+ 227,761 
+ 22,233 
+ 9.76 
+
+ 
+ Credit card commission 
+ 131,852 
+ 179,035 
+ (47,182) 
+ (26.35)
+
+ 
+ Depreciation – PPE 
+ 234,267 
+ 274,016 
+ (39,749) 
+ (14.51)
+
+ 
+ Depreciation – ROU assets 
+ 12,448 
+ 19,596 
+ (7,148) 
+ (36.48)
+
+ 
+ Lease expenses 
+ 1,016,558 
+ 1,198,762 
+ (182,204) 
+ (15.20)
+
+ 
+ Advertising, marketing and promotion expense 
+ 231,008 
+ 242,325 
+ (11,317) 
+ (4.67)
+
+ 
+ Other expenses 
+ 119,991 
+ 148,282 
+ (28,291) 
+ (19.08)
+
+ 
+ Total 
+ $2,960,063 
+ $3,597,143 
+ $(637,080) 
+ (17.71)
+
+ 
+
+ 
+
+Our
+general and administrative expenses consist mainly of remuneration paid to our staff in our administrative offices, professional fees,
+and rental and other overheads of our administrative offices. Since September 2023 and during the first six months of 2024, our accounting
+policy has been changed to record the remuneration of our executives as payroll expenses of our administrative offices instead of management
+expenses.
+
+ 
+
+ 56
+
+ 
+
+ 
+
+ 
+
+The
+following table sets forth, for the periods indicated, a breakdown of our general and administrative expenses:
+
+ 
+
+ 
+ 
+ For the six months ended December
+ 31, 
+
+ 
+ 
+ 2024 
+ 2023 
+ Change 
+ Change 
+
+ 
+ 
+ USD 
+ USD 
+ USD 
+ % 
+
+ 
+ 
+ (Unaudited) 
+ 
+ 
+
+ 
+ Payroll, MPF and staff benefits expense 
+ $252,195 
+ $232,268 
+ $19,927 
+ 8.58 
+
+ 
+ Rental, rates and property management fee expense 
+ 65,818 
+ 104,699 
+ (38,881) 
+ (37.14)
+
+ 
+ Depreciation – PPE 
+ 3,519 
+ 3,585 
+ (66) 
+ (1.84)
+
+ 
+ Lease expenses 
+ - 
+ - 
+ - 
+ 
+
+ 
+ Management expenses 
+ - 
+ 103,598 
+ (103,598) 
+ (100.00)
+
+ 
+ Other expenses 
+ 160,819 
+ 139,077 
+ 21,742 
+ 15.63 
+
+ 
+ Total 
+ $482,351 
+ $583,227 
+ $(100,876) 
+ (17.30)
+
+ 
+
+ 
+
+ 
+ 
+ For the years ended June 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+ Change 
+ Change 
+
+ 
+ 
+ USD 
+ USD 
+ USD 
+ % 
+
+ 
+ Payroll, MPF and staff benefits expense 
+ $534,998 
+ $45,331 
+ $489,667 
+ 1,080.20 
+
+ 
+ Rental, rates and property management fee expense 
+ 208,662 
+ 205,701 
+ 2,961 
+ 1.44 
+
+ 
+ Depreciation – PPE 
+ 7,367 
+ 8,293 
+ (926) 
+ (11.17)
+
+ 
+ Lease expenses 
+ - 
+ 5,951 
+ (5,951) 
+ (100.00)
+
+ 
+ Management expenses 
+ 103,596 
+ 618,963 
+ (515,367) 
+ (83.26)
+
+ 
+ Other expenses 
+ 337,172 
+ 92,370 
+ 244,802 
+ 265.02 
+
+ 
+ Total 
+ 1,191,795 
+ 976,609 
+ $215,186 
+ 22.03 
+
+ 
+
+ 
+
+Other
+income (expenses) 
+
+ 
+
+We
+operate our business in four commercial premises: three shops and one administrative office. During the periods covered by our financial
+statements, we relocated one of our shops and moved our administrative offices to a new space. Our other income (expenses) during these
+periods consisted mainly of changes in leasing arrangements linked to these two events and interest payments for bank loans, which we
+recorded as "finance costs". The transactions involved in the changes of our leasing arrangements were: (a) our assignment
+of the lease for the original space of our shop in the first half of 2022 to a third party, with the lease having expired in the first
+quarter in 2024; (b) our early termination of the lease of the original premises of a shop in the fourth quarter in 2023; (c) our entry
+into a lease to relocate this shop to new premises in the second quarter in 2023; and (d) our entry into a lease for the new space of
+our administrative headquarters in the third quarter in 2024.
+
+ 
+
+The
+following table sets forth, for the periods indicated, a breakdown of our other income (expenses):
+
+ 
+
+ 
+ 
+ For the six months ended December
+ 31, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ USD 
+ USD 
+
+ 
+ 
+ (Unaudited) 
+ (Unaudited) 
+
+ 
+ Charge of subleased rent & rates of shop at Grand Plaza 830 
+ $- 
+ $34,255 
+
+ 
+ Credit card cash rebate 
+ 2,077 
+ 2,664 
+
+ 
+ Resell of products 
+ 4,904 
+ 1,599 
+
+ 
+ Gain from termination of operating lease 
+ - 
+ 54,214 
+
+ 
+ Reversal of provision for reinstatement costs 
+ 37,504 
+ 14,804 
+
+ 
+ Sundry income 
+ 1,885 
+ 1,021 
+
+ 
+ Interest income 
+ 165 
+ 143 
+
+ 
+ Exchange gain / (loss), net 
+ (96) 
+ 464 
+
+ 
+ Loss on disposal of properties, property and equipment 
+ (185) 
+ (116,169)
+
+ 
+ Finance costs 
+ (16,323) 
+ (18,429)
+
+ 
+ Non-operating expenses – Rent compensation of early termination of
+ shop at Yuen Long 
+ - 
+ (31,975)
+
+ 
+ Total other (expenses) / income 
+ $29,931 
+ $(57,409)
+
+ 
+
+ 
+
+ 57
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ For the years ended June 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ USD 
+ USD 
+
+ 
+ Charge of subleased rent & rates of shop at Grand Plaza 830 
+ $49,228 
+ $66,499 
+
+ 
+ Credit card cash rebate 
+ 5,425 
+ 6,756 
+
+ 
+ Resell of products 
+ 1,599 
+ 9,456 
+
+ 
+ Gain from termination of operating lease 
+ 54,214 
+ - 
+
+ 
+ Reversal of provision for reinstatement costs 
+ 21,961 
+ - 
+
+ 
+ Sundry income 
+ 2,629 
+ 3,681 
+
+ 
+ Government subsidy 
+ - 
+ 81,814 
+
+ 
+ Interest income 
+ 351 
+ 147 
+
+ 
+ Exchange gain / (loss), net 
+ 540 
+ (53)
+
+ 
+ Loss on disposal of properties, property and equipment 
+ (116,695) 
+ (359)
+
+ 
+ Finance costs 
+ (35,244
+) 
+ (42,975
+)
+
+ 
+ Non-operating expenses – Rent compensation of early termination of shop at Yuen Long 
+ (31,974) 
+ - 
+
+ 
+ Non-operating expenses – customer claims 
+ - 
+ (5,923)
+
+ 
+ Non-operating expenses – deposits written-off 
+ - 
+ (21,181)
+
+ 
+ Total other (expenses) / income 
+ $(47,966) 
+ $97,862 
+
+ 
+
+ 
+
+Income
+tax
+
+ 
+
+We
+are incorporated in the Cayman Islands as an exempted company with limited liability under the Companies Act (Revised) of the Cayman
+Islands, operate our business through a wholly-owned subsidiary incorporated in Hong Kong, and hold our trademarks though another wholly-owned
+subsidiary incorporated Hong Kong.
+
+ 
+
+The
+Cayman Islands currently levies no taxes on profits, income, gains or appreciation recorded by exempted companies with limited liabilities.
+In addition, the Cayman Islands does not impose withholding tax on dividend payments. There are no other taxes likely to be material
+to us levied by the government of the Cayman Islands except for stamp duties which may be applicable on instruments executed in, or brought
+within the jurisdiction of the Cayman Islands.
+
+ 
+
+Under
+the current Hong Kong Inland Revenue Ordinance, our subsidiaries in Hong Kong is subject to profits tax at the rate of 8.25% on assessable
+profits up to HK$2,000,000; and 16.5% on any part of assessable profits over HK$2,000,000. Payments of dividends by our subsidiaries
+is not subject to any Hong Kong withholding tax.
+
+ 
+
+ 58
+
+ 
+
+ 
+
+ 
+
+Results
+of Operations
+
+ 
+
+Six
+months ended December 31, 2024 and 2023
+
+ 
+
+The
+following table sets forth a summary of our consolidated results of operations for the periods indicated, both in absolute amount and
+as a percentage of revenues. This information should be read together with our consolidated financial statements and related notes included
+elsewhere in this prospectus. The results of operations in any period are not necessarily indicative of our future trends.
+
+ 
+
+ 
+ 
+ For the six months ended December
+ 31, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ USD 
+ %
+ of
+
+ Revenue
+ 
+ USD 
+ %
+ of
+
+ Revenue
+ 
+
+ 
+ 
+ (Unaudited) 
+ 
+ (Unaudited) 
+ 
+
+ 
+ Revenues, net 
+ $3,250,577 
+ 100.0% 
+ $3,855,925 
+ 100.0%
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Costs and expenses 
+ 
+ 
+ 
+ 
+
+ 
+ Cost of revenue 
+ (658,466) 
+ (20.3)% 
+ (659,372) 
+ (17.1)%
+
+ 
+ Selling and marketing expense 
+ (1,157,769) 
+ (35.6)% 
+ (1,660,311) 
+ (43.1)%
+
+ 
+ General and administrative expense 
+ (482,351) 
+ (14.8)% 
+ (583,227) 
+ (15.1)%
+
+ 
+ Income from operations 
+ $951,991 
+ 29.3% 
+ $953,015 
+ 24.7%
+
+ 
+ Total other income / (expenses), net 
+ 29,931 
+ 0.9% 
+ (57,409) 
+ (1.5)%
+
+ 
+ Interest expense 
+ - 
+ -% 
+ - 
+ -%
+
+ 
+ Income before tax expense 
+ $981,922 
+ 30.2% 
+ $895,606 
+ 23.2%
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Provision for income tax 
+ - 
+ -% 
+ - 
+ -%
+
+ 
+ Net income 
+ $981,922 
+ 30.2% 
+ $895,606 
+ 23.2%
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Other comprehensive income 
+ (44,660) 
+ (1.4)% 
+ (33,621) 
+ (0.9)%
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Total comprehensive income 
+ $937,262 
+ 28.8% 
+ $861,985 
+ 22.4%
+
+ 
+
+ 
+
+Revenues
+
+ 
+
+Revenues
+decreased by $605,348, or 15.7%, to $3,250,577 for the six months ended December 31, 2024, compared to $3,855,925 for the six months
+ended December 31, 2023, mainly due to the weak economic conditions in Hong Kong, competition from similar establishments in Shenzhen
+caused by the depreciation of the RMB against the Hong Kong dollar, and a reduction in the size of our target customer pool resulted
+from the emigration of the middle-income families and mid-career professionals.
+
+ 
+
+Cost
+of revenue
+
+ 
+
+Cost
+of revenue decreased slightly to $658,466 for the six months ended December 31, 2024 from $659,372 for the six months ended December
+31, 2023, representing a decrease of $906, or 0.1%. For the six months ended December 31, 2024, there was a decrease in medical aesthetic
+treatment costs of $2,526 the effects of which were offset by an increase in normal beauty treatment costs of $20,016. Such changes reflected
+a shift in customer demand between the two treatment categories during the period, which we believe were normal fluctuations instead
+of a market trend favoring normal beauty treatments over medical aesthetic treatments.
+
+ 
+
+Selling
+and marketing expenses 
+
+ 
+
+Selling
+and marketing expenses was $1,157,769 for the six months ended December 31, 2024 from $1,660,311 for the six months ended December 31,
+2023, representing a decrease of $502,542, or 30.3%. The decrease was mainly due to (i) a decrease advertising, marketing and promotion
+expenses of $129,951; (ii) a decrease in lease expenses of $163,027; and (iii) a decrease in payroll, MPF and staff benefits of $108,747,
+which reflected a decrease in commission related to our sales of prepaid packages.
+
+ 
+
+General
+and administrative expenses 
+
+ 
+
+General
+and administrative expenses decreased to $482,351 for the six months ended December 31, 2024 from $583,227 for the six months ended December
+31, 2023. The decrease was mainly caused by a decrease in rental, rates and property management fee expense of $38,881, the effects of
+which were partially offset by an increase in payroll of $19,927 and an increase in other general and administrative expenses of $21,742,
+which were caused by additional work as we started preparing for this offering.
+
+ 
+
+ 59
+
+ 
+
+ 
+
+ 
+
+Income
+from operations
+
+ 
+
+Income
+from operations decreased by $1,024, or 0.1%, to $951,991 for the six months ended December 31, 2024, from $953,015 for the six months
+ended December 31, 2023. Although our revenue decreased by $605,348, the impact was largely offset by a corresponding decrease of selling
+and marketing expenses of $502,542.
+
+ 
+
+Other
+income (expenses)
+
+ 
+
+For
+the six months ended December 31, 2024, other income was $29,931, compared with other expenses of $57,409 for the six months ended December
+31, 2023. The change reflected several events that occurred during the two periods.
+
+ 
+
+Other
+income for the six months ended December 31, 2024 was mainly attributable to a reversal of the provision for the reinstatement costs
+of $22,700 when the lease of the original space of our administrative office expired in the third quarter of 2024.
+
+ 
+
+Other
+expenses for the six months ended December 31, 2023 were mainly attributable to a loss of $116,169 recorded in our disposal of equipment
+with an aggregate value more than average, due to the vacation of the original premises of our relocated shop. The effects of the foregoing
+were partially offset by the $54,214 recorded as gain from the early termination of the lease for the original premises of our relocated
+shop in the fourth quarter of 2023 and our collection of rent of $34,255 from the third party who occupied the original space of a shop
+under a sublease during the full six months. We recorded a gain from the lease termination because we were released from the contractual
+obligations we originally recorded for the remaining term of the lease.
+
+ 
+
+Finance
+cost decreased by $2,106 to $16,323 for the six months ended December 31, 2024 from $18,429 for the six months ended December 31, 2023,
+which was a result of lower bank borrowing balance.
+
+ 
+
+Income
+tax expenses
+
+ 
+
+The
+Company s income tax expenses were $nil for the six months ended December 31, 2024 and 2023.
+
+ 
+
+Net
+income
+
+ 
+
+Net
+income increased by $86,316, or 9.6%, to $981,922 for the six months ended December 31, 2024 from $895,606 for the six months ended December
+31, 2023. The increase in the net income during the six months ended December 31, 2024 was mainly attributable to the cumulative effect
+of the reasons set out above.
+
+ 
+
+ 60
+
+ 
+
+ 
+
+ 
+
+Fiscal
+Years ended June 30, 2024 and 2023 
+
+ 
+
+The
+following table sets forth a summary of our consolidated results of operations for the periods indicated, both in absolute amount and
+as a percentage of revenues. This information should be read together with our consolidated financial statements and related notes included
+elsewhere in this prospectus. The results of operations in any period are not necessarily indicative of our future trends.
+
+ 
+
+ 
+ 
+ For the years ended June 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ USD 
+ % of Revenue 
+ USD 
+ % of Revenue 
+
+ 
+ Revenues, net 
+ $6,111,388 
+ 100.0% 
+ $8,022,480 
+ 100.0%
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Costs and expenses 
+ 
+ 
+ 
+ 
+
+ 
+ Cost of revenue 
+ (1,303,886) 
+ (21.3)% 
+ (1,646,315) 
+ (20.5)%
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Selling and marketing expense 
+ $(2,960,063) 
+ (48.4)% 
+ $(3,597,143) 
+ (44.8)%
+
+ 
+ General and administrative expense 
+ (1,191,795) 
+ (19.5)% 
+ (976,609) 
+ (12.2)%
+
+ 
+ Finance costs 
+ (35,244) 
+ (0.6)% 
+ (42,975) 
+ (0.5)%
+
+ 
+ Income from operations 
+ $620,400 
+ 10.2% 
+ $1,759,438 
+ 21.9%
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Total other (expenses)/income, net 
+ (12,722) 
+ (0.2)% 
+ 140,837 
+ 1.8%
+
+ 
+ Interest expense 
+ - 
+ -% 
+ - 
+ -%
+
+ 
+ Income before tax expense 
+ $607,678 
+ 9.9% 
+ $1,900,275 
+ 23.7%
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Provision for income tax 
+ - 
+ -% 
+ - 
+ -%
+
+ 
+ Net income 
+ $607,678 
+ 9.9% 
+ $1,900,275 
+ 23.7%
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Other comprehensive income 
+ (38,438) 
+ (0.5)% 
+ 58,482 
+ 0.7%
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Total comprehensive income 
+ $569,330 
+ 9.4% 
+ $1,958,757 
+ 24.4%
+
+ 
+
+ 
+
+Revenues
+
+ 
+
+Revenues
+decreased by $1,911,092, or 23.8%, to $6,111,388 for the year ended June 30, 2024, compared to $8,022,480 for the year ended June 30,
+2023, mainly due to lower level of business activities attributable to the factors discussed in the six months ended December 31, 2024.
+The decrease was mainly caused by the decrease in revenues recognized in normal beauty treatments and, to a lesser extent, medical aesthetic
+treatments, although their effects were partially offset by a slight increase in forfeited revenue generated from expiration of prepaid
+packages.
+
+ 
+
+Costs
+of revenue 
+
+ 
+
+Cost
+of revenue decreased to $1,303,886 for the year ended June 30, 2024, representing a decrease by $347,429, or 20.8%, from $1,646,315 for
+the year ended June 30, 2023. The decrease in treatment services rendered was reflected by decreases in the main variable cost items,
+such as costs incurred in medical aesthetic treatments and normal beauty treatments and doctor s fees. On a percentage basis, the
+decrease in cost of revenue was lower because some of the fixed cost items such as basic salaries for staff were basically unchanged.
+
+ 
+
+Selling
+and marketing expenses
+
+ 
+
+Selling
+and marketing expenses was $2,960,063 for the year ended June 30, 2024, representing a decrease by $637,080, or 17.7%, from $3,597,143
+for the year ended June 30, 2023. The decrease was due to (i) a decrease in the payroll, MPF and staff benefits of $343,422 due to a
+decrease in the number of staff in the shops; (ii) a decrease in the rental expenses of $182,204 caused by the expiration of the lease
+of the original space of a shop; and (iii) a decrease in credit card commission of $47,182, reflecting the decrease in our sales.
+
+ 
+
+General
+and administrative expenses
+
+ 
+
+General
+and administrative expenses increased by $215,186, or 22.0%, to $1,191,795 for the year ended June 30, 2024, from $976,609 for the year
+ended June 30, 2023. This increase was mainly due to an increase in other expenses of $244,802, which were caused by an increase in the
+administrative tasks as we started preparing for this offering in the first six months of 2024.
+
+ 
+
+Income
+from operations
+
+ 
+
+Income
+from operations decreased by $1,146,769, or 63.6%, to $655,644 for the year ended June 30, 2024 from the income from operation of $1,802,413
+for the year ended June 30, 2023.
+
+ 
+
+ 61
+
+ 
+
+ 
+
+ 
+
+Other
+income (expenses)
+
+ 
+
+For
+the year ended June 30, 2024, we recorded other expenses of $47,966, compared with other income of $97,862 for the year ended June 30,
+2023.
+
+ 
+
+There
+were two reasons behind the change. First, we vacated one of our shops in its original premises in the fourth quarter of 2023 and relocated
+the shop to new premises in the third quarter of 2023 and disposed equipment with an aggregate value higher than average. As a result,
+for the year ended June 30, 2024, we recorded loss on disposal of $116,695 compared with $359 for the year ended June 30, 2023. Second,
+for the year ended June 30, 2023, we collected government subsidy of $81,814. No similar event occurred for the year ended June 30, 2024.
+The subsidy was granted under a scheme that was launched during the COVID-19 period for small to medium-sized businesses in Hong Kong.
+
+ 
+
+Finance
+cost decreased by $7,731 to $35,244 for the year ended June 30, 2024 from $42,975 for the year ended June 30, 2023, due to the lower
+average daily amount of bank loans outstanding during the period from July 1, 2023 to June 30, 2024.
+
+ 
+
+Income
+tax expenses
+
+ 
+
+We
+did not record any income tax expenses for the year ended June 30, 2024 and June 30, 2023, mainly due to the offset by cumulative tax
+losses during both periods.
+
+ 
+
+Net
+income
+
+ 
+
+Net
+income decreased by $1,389,427, or 70.9%, to $607,678 for the year ended June 30, 2024 from $1,900,275 for the year ended June 30, 2023.
+The decrease was mainly attributable to the cumulative effect of the reasons set out above.
+
+ 
+
+Liquidity
+and Capital Resources
+
+ 
+
+Our
+principal sources of liquidity are operating cash flows, shareholder loans and bank borrowings. We have primarily relied on these sources
+to meet our working capital needs and capital expenditures requirements. Our main capital expenditure requirements are renovation projects
+in our shops and beauty treatment devices.
+
+ 
+
+Going
+Concern
+
+ 
+
+During
+the COVID-19 pandemic, our shops had been shut down multiple times between March 2020 and October 2022 in response to the pandemic measures
+of the Hong Kong government. Our results of operations have yet to return to the pre-pandemic levels. For the six months ended December
+31, 2024 and 2023, we recorded net income of $981,922 and of $895,606, respectively. In light of the weak economic conditions in Hong
+Kong, we may continue to record negative operating cash flows. For the six months ended December 31, 2024 and 2023, we had negative cash
+flows from operating activities of $611,480 and $525,061, respectively. We also have significant working capital deficiency, shareholder
+deficits and a limited cash balance. As of December 31, 2024, our cash balance was $3,875, compared with $85,798 as of June 30, 2024,
+and our working capital deficits were $8,313,163 as of December 31, 2024, compared with $9,029,519 as of June 30, 2024.
+
+ 
+
+The
+report from our independent registered public accounting firm for the years ended June 30, 2024 and 2023 includes an explanatory paragraph
+stating we had negative cash flows from operating activities for both years, and have significant working capital deficiency and accumulated
+deficits as of June 30, 2024. These conditions raise substantial doubt about our ability to continue as a going concern.
+
+ 
+
+ 62
+
+ 
+
+ 
+
+ 
+
+Having
+considered our ability to borrow additional loans from banks and shareholders and raise funds from other investors against our working
+capital needs, operating lease payments and capital expenditure requirements, our management believes that we have sufficient capital
+resources to maintain our business operations for the next twelve months. For the foregoing reasons, our audited and unaudited consolidated
+financial statements were prepared assuming that we will continue as a going concern, which contemplates the realization of assets and
+satisfaction of liabilities in the normal course of business. The consolidated financial statements do not include any adjustments related
+to the recoverability and or classification of the recorded asset amounts and or the classification of the liabilities that might be
+necessary should we be unable to continue as a going concern.
+
+ 
+
+The
+success of our business will be contingent upon generating sufficient revenue to cover our operating costs. Our management may need to
+fund some of our capital needs through equity issuances, bank borrowings, shareholder loans and proceeds from this offering and to implement
+cost-cutting measures. If we obtain additional capital by issuing equity, the interests of our existing stockholders will be diluted.
+If we incur additional indebtedness, that indebtedness may contain significant financial and other covenants that may significantly restrict
+our operations. We cannot assure you that we could obtain additional financing on favorable terms or at all.
+
+ 
+
+If
+we are unable to obtain sufficient funding, our business, prospects, financial condition and results of operations will be materially
+and adversely affected and we may be unable to continue as a going concern.
+
+ 
+
+Cash
+Flows 
+
+ 
+
+Our
+use of cash is primarily related to operating activities and investing activities. We have historically finance our operations primarily
+through our cash flow generated from our financing activities. The following tables set forth a summary of our cash flows for the periods
+indicated:
+
+ 
+
+ 
+ 
+ For the six months ended December
+ 31, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ USD 
+ USD 
+
+ 
+ 
+ (Unaudited) 
+ (Unaudited) 
+
+ 
+ Net cash (used in) operating activities 
+ $
+(611,480) 
+ $
+(525,061)
+
+ 
+ Net cash (used in) investing activities 
+ (2,396) 
+ (103,101)
+
+ 
+ Net cash provided by financing activities 
+ 531,709 
+ 642,883 
+
+ 
+
+ 
+
+ 
+ 
+ For the years ended June 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ USD 
+ USD 
+
+ 
+ Net cash (used in) operating activities 
+ $(1,031,834) 
+ $(1,151,987)
+
+ 
+ Net cash (used in) investing activities 
+ (104,709) 
+ (54,005)
+
+ 
+ Net cash provided by financing activities 
+ 1,162,186 
+ 1,022,228 
+
+ 
+
+ 
+
+Cash
+used in operating activities:
+
+ 
+
+Net
+cash used in operating activities was $611,480 for the six months ended December 31, 2024. Adjustments were made to net income of $981,922
+to reflect non-cash items, including (i) non-cash operating lease expenses of $404,951 and, to a lesser extent, (ii) depreciation of
+property and equipment of $43,286, the effects of which were partially offset by reversal of provision for reinstatement costs of $37,504
+arising from the expiration of the lease of the old space of the administrative offices. Non-cash operating lease expenses arose due
+to the timing differences between the time when the expenses incurred under an operating lease are recorded and the time when the rental
+payments are made under the terms of the lease. The effects of the non-cash adjustments, however, were fully offset by operating working
+capital changes with a cumulative negative effect on cash flow. Such changes were primarily the result of (i) a decrease in contract
+liabilities of $1,747,140 reflecting the consumption of prepaid treatments without a corresponding increase in the sale of new prepaid
+packages; (ii) a decrease in operating lease liabilities of $409,582 reflecting rental payments, although their effects were partially
+offset an increase in other payables and accruals of $86,579. The increase in other payables and accruals was significantly lower than
+the increase of the same line item of $392,272 for the six months ended December 31, 2023 due to the payments of doctor s fees
+in the normal course of business.
+
+ 
+
+ 63
+
+ 
+
+ 
+
+ 
+
+Net
+cash used in operating activities was $525,061 for the six months ended December 31, 2023. The result was attributable to similar factors
+affecting the same period in 2024 as described above. Adjustments were made to net income of $895,606 to reflect non-cash items, including
+(i) non-cash operating lease expenses of $567,978 and (ii) depreciation of property and equipment of $130,622. The effects of these adjustments,
+however, were fully offset by operating working capital changes with a cumulative negative effect on cash flow. Such changes were primarily
+the result of (i) a decrease in contract liabilities of $1,965,992 and (ii) a decrease in operating lease liabilities of $660,450, although
+their effects were partially offset by an increase in other payables and accruals of $392,272.
+
+ 
+
+Net
+cash used in operating activities was $1,031,834 for the year ended June 30, 2024. Adjustments were made to net income of $607,678 to
+reflect non-cash items, including (i) non-cash operating lease expenses of $1,016,558 and (ii) depreciation of property and equipment
+of $240,120. The effects of these adjustments, however, were fully offset by operating working capital changes with a cumulative negative
+effect on cash flow. Such changes were primarily the result of (i) a decrease in deferred contract liabilities of $2,393,547 reflecting
+the consumption of treatments covered by prepaid packages without a corresponding increase in the sale of prepaid packages; and (ii)
+a decrease in operating lease liabilities of $1,157,281 mainly attributable to the early termination of the old lease of the relocated
+shop, although their effects were partially offset by an increase in other payables and accruals of $466,939. The increase in other payables
+and accruals was significantly higher than the increase of the same line item of $186,903 for the year ended June 30, 2023 because of
+the increase in doctor s fee payables and audit fees for this offering.
+
+ 
+
+Net
+cash used in operating activities was $1,151,987 for the year ended June 30, 2023. Adjustments were made to net income of $1,900,275
+to reflect non-cash items, including (i) non-cash operating lease expenses of $1,135,205 and (ii) depreciation of property and equipment
+of $282,309. The effects of these adjustments, however, were fully offset by operating working capital changes with a cumulative negative
+effect on cash flow. Such changes were primarily the result of (i) a decrease in contract liabilities of $3,701,893; and (ii) a decrease
+in operating lease liabilities of $1,141,297; although their effects were partially offset by an increase in other payables and accruals
+of $186,903.
+
+ 
+
+Cash
+used in financing activities:
+
+ 
+
+Net
+cash provided by financing activities was $531,709 for the six months ended December 31, 2024, mainly due to the receipt of $594,865
+from related parties, the effect of which was partially offset by the repayment of some bank borrowings in the aggregate amount of $63,156.
+
+ 
+
+Net
+cash provided by financing activities was $642,883 for the six months ended December 31, 2023, mainly due to the receipt of $823,274
+from related parties, the effect of which was partially offset by the settlement of deferred offering costs of $119,247 and, to a lesser
+extent, the repayment of bank borrowings in the aggregate amount of $58,192.
+
+ 
+
+Net
+cash provided from financing activities was $1,162,186 for the year ended June 30, 2024, mainly due to a capital injection from the conversion
+of promissory note of $1,038,000 and proceeds from related parties of $469,646, the effect of which was partially offset by the settlement
+of deferred offering costs of $227,841.
+
+ 
+
+Net
+cash provided from financing activities was $1,022,228 for the year ended June 30, 2023, mainly due to net proceeds from related parties
+of $1,111,144, the effect of which was partially offset by the repayments of bank borrowings of $77,734.
+
+ 
+
+Cash
+used in investment activities:
+
+ 
+
+Net
+cash used in investment activities was $2,396 for the six months ended December 31, 2024, mainly due to the purchase of property and
+equipment.
+
+ 
+
+ 64
+
+ 
+
+ 
+
+ 
+
+Net
+cash used in investment activities was $103,101 for the six months ended December 31, 2023, mainly due to the purchase of property and
+equipment of $157,444, the effect of which was partially offset by the proceeds from the disposal of property and equipment of $54,343.
+
+ 
+
+Net
+cash used in investment activities was $104,709 for the year ended June 30, 2024, mainly due to the purchase of property and equipment
+of $162,726, the effect of which was partially offset by the proceeds from the disposal of property and equipment of $58,017.
+
+ 
+
+Net
+cash used in investment activities was $54,005 for the year ended June 30, 2023, mainly due to the purchase of property and equipment.
+
+ 
+
+Contractual
+Obligations and Commitments 
+
+ 
+
+Our
+contractual obligations mainly include payment obligations under the operating leases of our administrative offices and three shops and
+bank borrowings. We may enter into finance leases for our treatment equipment in the ordinary course of business from time to time.
+
+ 
+
+The
+following table sets forth the Company s contractual obligations for the next five years as of December 31, 2024:
+
+ 
+
+ 
+ Contractual Obligations 
+ Total 
+ Less
+
+ than
+
+ 1
+ year
+ 
+ 2 years 
+ 3 years 
+ 4 years 
+ 5 years 
+ More
+
+ than
+
+ 5 years
+ 
+
+ 
+ Operating lease obligations 
+ $1,300,693 
+ $662,068 
+ $426,490 
+ $212,135 
+ $- 
+ $- 
+ $- 
+
+ 
+ Finance lease obligations 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+
+ 
+ Loan obligations 
+ 871,392 
+ 127,001 
+ 130,862 
+ 134,843 
+ 138,906 
+ 143,169 
+ 196,611 
+
+ 
+ Provision for reinstatement 
+ 115,768 
+ 41,108 
+ 12,526 
+ 62,134 
+ - 
+ - 
+ - 
+
+ 
+ Total 
+ $2,287,853 
+ $830,177 
+ $569,878 
+ $409,112 
+ $138,906 
+ $143,169 
+ $196,611 
+
+ 
+
+ 
+
+Below
+is additional information about our payment obligations under the operating leases and bank loans that were outstanding as of December
+31, 2024:
+
+ 
+
+ 
+ Usage 
+ Location 
+ From 
+ To 
+ Monthly
+
+ Rent
+
+ 
+ Shop 
+ Suites 1701, 1712 & 1715, Level 17, Office Tower, Langham Place, 8 Argyle Street, Mongkok, Kowloon 
+ August
+ 20, 2023 
+ August
+ 19, 2025 
+ US$26,337
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Shop 
+ Room No. 3201-3203, 32/F, The World Trade Centre, 280 Gloucester Road, Causeway Bay, Hong Kong 
+ July
+ 12, 2024 
+ July
+ 11, 2027 
+ US$33,615
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Shop 
+ Office No. 8-9, 8/F, Kwong Wah Plaza, 11 Tai Tong Road, Yuen Long, New Territories 
+ May
+ 30, 2023 
+ May
+ 29, 2026# 
+ US$7,490
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Shop 
+ Office No. 6-7, 8/F, Kwong Wah Plaza, 11 Tai Tong Road, Yuen Long, New Territories 
+ August
+ 3, 2024* 
+ May
+ 29, 2026# 
+ US$5,390
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Office 
+ Unit 15-16, 22/F., CEO Tower, 77 Wing Hong Street, Cheung Sha Wan, Kowloon 
+ August
+ 1, 2024 
+ July
+ 31, 2027 
+ US$4,931
+
+ 
+
+ 
+
+*
+Note: This shop is sub-leased by Be Health Company Limited on a short-term and monthly basis effective from August 3, 2024, pursuant
+to a cooperation agreement between Be Health Company Limited and GCHL dated July 29, 2024 (the "Cooperation Agreement").
+
+ 
+
+#
+On July 29, 2025, we, together with Be Health Company Limited, entered into a Transfer Agreement with Beauty Plus Limited, in which among
+other items, the furniture, renovation, beds for beauty treatments of the Yuen Long Shop will be sold to Beauty Plus Limited.
+
+ 
+
+ 65
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Outstanding
+
+ principal
+ amount
+
+ (HKD)
+ 
+ Start Date 
+ Maturity Date 
+ Interest
+ %*(1) 
+ Guarantor(2)
+
+ 
+ 1) 
+ 2,000,000 
+ January 8, 2020 
+ January 8, 2023 
+ 0.5% monthly 
+ Mr. Ng
+
+ 
+ 2) 
+ 4,000,000 
+ May 8, 2020 
+ May 7, 2030 
+ P minus 2.5% 
+ Mr. Ng
+
+ 
+ 3) 
+ 2,000,000 
+ August 30, 2021 
+ August 29, 2031 
+ P minus 2.5% 
+ Mr. Ng
+
+ 
+ 4) 
+ 3,000,000 
+ May 27, 2022 
+ May 26, 2032 
+ P minus 2.5% 
+ Mr. Ng
+
+ 
+
+ 
+
+ 
+ 
+ (1)
+ P
+ represents prime lending rate of Hong Kong. As of December 31, 2024, P was 5.25%.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ (2)
+ The
+ loans were originally guaranteed by Ms. Huang Weisi, our ex-director and ex-shareholder. Mr. Ng assumed her obligations under the
+ loans on April 2, 2024 when Ms. Huang sold her shares to MTHL and resigned as a director.
+
+ 
+ 
+
+Off-Balance
+Sheet Arrangements
+
+ 
+
+As
+of December 31, 2024, we did not have during the periods presented, and we do not currently have, any off-balance sheet financing arrangements
+as defined under the rules and regulations of the SEC, or any relationships with unconsolidated entities or financial partnerships, including
+entities sometimes referred to as structured finance or special purpose entities, that were established for the purpose of facilitating
+off-balance sheet arrangements or other contractually narrow or limited purposes.
+
+ 
+
+Critical
+Accounting Policies and Estimates
+
+ 
+
+We
+believe that the accounting policies discussed below involve a high degree of judgment and complexity and are the most critical to fully
+understanding and evaluating our consolidated financial condition and results of our operations. See Note 3 "Summary of Significant
+Accounting Policies" to our consolidated financial statements included elsewhere in this prospectus for a description of our other
+significant accounting policies.
+
+ 
+
+Estimates
+and assumptions used in preparing the reported amounts and disclosure under these policies are based on information as of the date of
+the consolidated financial statements. They are evaluated on an ongoing basis and its estimates on historical experience, current and
+expected future conditions and various other assumptions that management believes are reasonable under the circumstances based on the
+information available to management at the time these estimates and assumptions are made. Actual results could differ from these estimates:
+
+ 
+
+Allowance
+for credit losses – See Note 3. Significant assumptions for measurement used by management in estimating the expected credit loss
+include weighted-average loss rate or default rate, current and future financial situation of debtors for individual receivables that
+management is aware will be difficult to collect, and future general economic conditions.
+
+ 
+
+Measurement
+of credit losses on financial instruments – See Note 3. The Company, in accordance with ASC Topic 340, Other Assets and Deferred
+Costs, the incremental costs to obtain the contracts are deferred and amortized according to service package utilization rate, which
+represents management s estimate of the average benefit period.
+
+ 
+
+Asset
+Retirement Obligation (Provision for Reinstatement Costs) – See Note 3. The Company have made provision for the reinstatement costs
+for its leased properties based on current market prices and quotes from renovation companies. As the market value of reinstatement costs
+do not change substantially that the Company does not adjust the carrying amount of the liability.
+
+ 
+
+Leases
+– See Note 3. Management makes significant assumptions regarding lease terms, exercise options and present value methodologies
+in determining the value of its right-of-use assets.
+
+ 
+
+Revenue
+Recognition
+
+ 
+
+Our
+revenue is derived from the provision of medical aesthetic and beauty treatment services. Such services are sold to customers in the
+form of prepaid packages. Each package contains one or a combination of treatments and is valid for two years from the time of sale.
+
+ 
+
+We
+recognize revenue from customer contracts in accordance with the "five-step model" under the accounting rules. The five-step
+model requires that we (i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii)
+determine the transaction price, (iv) allocate the transaction price to the respective performance obligations in the contract, and (v)
+recognize revenue as we satisfy the performance obligation.
+
+ 
+
+When
+the customer redeems a service included in the prepaid package, revenue is recognized in the amount allocated to the specific treatment
+based on its standalone selling price. If the package does not specify the price of a treatment, we will apply its standalone selling
+price. We have established a range of standalone selling price for our services based on historical sales and current market price. The
+standalone selling price we apply to each treatment may be adjusted to reflect the facts and circumstances of the case, including customer
+relationship, discount provided and the combination of treatments covered in the package.
+
+ 
+
+ 66
+
+ 
+
+ 
+
+ 
+
+Any
+unredeemed amount in the prepaid package at the end of the period will be recognized as forfeited revenue. If prior to expiration, we
+agree to modify the scope, price and validity period of the package, then management must make judgements as to how to record the sales
+of the modified package. The modified package can be recorded as a separate contract, a termination of the original contract and concurrent
+creation of a new contract, a cumulative catch-up in the original contract or a combination of the above.
+
+ 
+
+Determining
+whether, how and when to apply these revenue recognition criteria often involves assumptions and judgments that can have a significant
+impact on the timing and amount of reported revenue. Changes in assumptions or judgments or changes to the elements in an arrangement
+could cause a material increase or decrease in the amount of revenue that is reported in a particular period.
+
+ 
+
+Rental
+and Other Related Expenses
+
+ 
+
+All
+of our shop and office space leases are classified as operating leases. When we enter into a lease of this nature, we record the right
+to use the space as a right-to-use (ROU) asset and our payment obligations thereunder as lease liabilities.
+
+ 
+
+We
+recognize lease expense on a straight-line basis based on the amount of lease liabilities. The amount of lease liabilities to be recorded
+is the present value of the total lease payments. In determining the discount rate to be used to compute the present value, management
+uses the incremental borrowing rate, which is the estimated rate we would be required to pay for a collateralized borrowing equal to
+the total lease payments over the term of the lease, based on information available on the lease commencement date.
+
+ 
+
+When
+we record lease liabilities, an ROU asset is also recorded. The amount of ROU to be recorded equals the initial amount of the lease liability,
+plus any lease payments made to the lessor before or at the lease commencement date and any initial direct costs incurred, less any lease
+incentives received. The difference between the minimum rents paid and the straight-line rent is reflected within the associated operating
+lease asset.
+
+ 
+
+We
+incur costs in leasehold improvements, furniture and fixtures and equipment to build out and equip our leased premises. All are recorded
+as part of the ROU and are amortized over the term of the lease.
+
+ 
+
+Maintenance,
+insurance and property tax expenses are generally accounted for on an accrual basis as variable lease costs. We recognize variable lease
+cost for operating leases in the period when changes in facts and circumstances on which the variable lease payments are based occur.
+
+ 
+
+Our
+lease agreements do not contain any material residual value guarantees or material restrictive covenants, but we are required to return
+the space to the lessor in its original form. Thus, we make provision for the reinstatement costs for our leased properties. Management
+determines the amount of provision needed based on current market prices and quotes from renovation companies. As the market value of
+reinstatement costs do not change substantially that the Company does not adjust the carrying amount of the liability.
+
+ 
+
+On
+or around April 1, 2022, we assigned the lease of the original space of a shop to a third party. As we were not released from our primary
+obligations under the original lease, our lease liabilities under the original lease remain unchanged. We record the event as an entry
+into a separate lease, a sublease between us and the third party. The lease expired in the first half of 2024.
+
+ 
+
+Market
+Risks
+
+ 
+
+Foreign
+exchange risk
+
+ 
+
+The
+reporting currency of the Company is U.S. dollar. Substantially all of our revenues and expenses and a significant portion of our assets
+and liabilities are denominated in Hong Kong dollar. The value of the Hong Kong dollar against the U.S. dollar is under a linked exchange
+rate system. We do not believe that we currently have any significant direct foreign exchange risk and have not used any derivative financial
+instruments to hedge exposure to such risk.
+
+ 
+
+ 67
+
+ 
+
+ 
+
+ 
+
+Interest
+rate risk
+
+ 
+
+Interest
+rate risk is the risk that future cash flows will fluctuate as a result of changes in market interest rates. Our exposure to interest
+rate risk primarily relates to the interest rates levied on our bank borrowings. All of our bank loans, except one, provide for interest
+that are adjustable based on prime lending rate of Hong Kong. Our shareholders loans are interest free.
+
+ 
+
+We
+have not used any derivative financial instruments to manage our interest risk exposure. However, we cannot provide assurance that we
+will not be exposed to material risks due to changes in market interest rate in the future.
+
+ 
+
+Inflation
+risk
+
+ 
+
+Since
+our inception in 2004, inflation in Hong Kong has not materially affected our results of operations. According to International Monetary
+Fund, World Bank and OECD Inflation CPI indicator, average inflation rate from 2004 to 2023 was 2.39%. The year-over year percentage
+changes in the consumer price index for 2022 and 2023 were increases of 1.19% and 2.44%, respectively. Although we have not been materially
+affected by inflation in the past, we may be affected if Hong Kong experiences higher rates of inflation in the future. If our costs
+become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through price increases.
+
+ 
+
+Recently
+Issued Accounting Pronouncements
+
+ 
+
+A
+list of recently issued accounting pronouncements that are relevant to us is included in Note 3 to our consolidated financial statements
+included elsewhere in this prospectus.
+
+ 
+
+Internal
+Control Over Financial Reporting
+
+ 
+
+Prior
+to the initial public offering of the Company, we have been a private company with limited accounting personnel and other resources with
+which we address our internal control over financial reporting. We therefore do not have sufficient competent financial reporting and
+accounting personnel with appropriate understanding of U.S. GAAP to design and implement formal period-end financial reporting controls
+and procedures to address complex U.S. GAAP technical accounting issues, and to prepare and review the consolidated financial statements
+and related disclosures in accordance with U.S. GAAP and financial reporting requirements set forth by the SEC. We believe that this
+could constitute a material weakness in our internal control. As defined in the standards established by the PCAOB, a "material
+weakness" is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable
+possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely
+basis.
+
+ 
+
+Neither
+our management nor its independent registered public accounting firm have performed an assessment of the effectiveness of the Company s
+internal control over financial reporting.
+
+ 
+
+To
+strengthen our system of internal control, we are looking for additional qualified financial and accounting personnel with working experience
+with U.S. GAAP and SEC reporting requirements. We are currently in the process of establishing clear rules and responsibilities for accounting
+and financial reporting staff to address complex accounting and financial reporting issues. We plan to recruit more competent professional
+staff and/or engage independent advisor to strengthen the internal control.
+
+ 
+
+We
+are not currently required to maintain an effective system of internal controls. We will not be required to comply with the internal
+control requirements of the Sarbanes-Oxley Act until we are required to file an annual report pursuant to section 13(a) or 15(d) of the
+Exchange Act for a prior fiscal year. Further, as an emerging growth company, we are exempt from the auditor attestation requirement
+under Section 404 of the Sarbanes-Oxley Act in the assessment of the emerging growth company s internal control over financial
+reporting. 
+
+ 
+
+ 68
+
+ 
+
+ 
+
+ 
+
+HISTORY
+AND CORPORATE STRUCTURE
+
+ 
+
+Our
+operating history began in 2004 when GCHL was incorporated on 31 March 2004 in Hong Kong by Mr. Ng Hon Kin to provide traditional/normal
+beauty treatments and products. GCHL has remained as the operating arm through which we conduct our business. DCMCL was incorporated
+on 21 June 2006 as our trademarks custodian. MTL was incorporated on March 22, 2024 and is a dormant subsidiary since incorporation for
+the purposes of reserving for future business operations.
+
+ 
+
+To finance some
+of the expenses of this offering and operating needs of the business, our Controlling Shareholder borrowed $1,038,000 in the aggregate
+from seven individuals between July 17, 2023 and February 8, 2024. The borrowed sums were evidenced by various promissory notes issued
+from March 2023 to October 2023, pursuant to which our Controlling Shareholder had the option to repay the borrowings in the form of
+shares representing equity interests in the Group.
+
+ 
+
+In preparation
+for this offering, on March 13, 2024, our Controlling Shareholder caused the incorporation of the Company under the laws of the Cayman
+Islands and became the sole shareholder of the Company shortly
+thereafter. At the time, the Company s authorized share capital was $10,000 consisting of 100,000,000 shares with par value $0.0001
+per share, of which 85,000,000 were Ordinary Shares and the remaining were 15,000,000 preferred shares. Our Controlling Shareholder beneficially
+owned 17,550,000 Ordinary Shares, representing 100% of the Company s issued share capital.
+
+ 
+
+MTHL
+was incorporated on March 21, 2024 under the laws of Hong Kong as a wholly owned subsidiary of the Company. Though a series of share
+swaps with GCHL, DCMCL and MTL, the Group was formed on or around March 28, 2024 with the Company as the holding company on the top with
+its ownership interest in GCHL, DCMCL and MTL held through MTHL as the intermediate holding company.
+
+ 
+
+The
+seven promissory notes described above were cancelled on March 28, 2024. In consideration thereof, our Controlling Shareholder caused
+the Company to issue Ordinary Shares to entities designated the noteholders at an issue price per share $0.0001.
+
+ 
+
+On
+March 19, 2025, the authorized share capital of the Company was amended to $11,000 consisting of 110,000,000 shares with par value of
+$0.0001 per share, of which 85,000,000 were Class A Ordinary Shares and the remaining 25,000,000 were Class B Ordinary Shares. The two
+classes of shares have substantially similar terms, except that the Class B Ordinary Shares carry a voting power that is 20 times of
+the Class A Ordinary Shares. Immediately after the share capital amendment, the Ordinary Shares then held by the seven former noteholders
+were reclassified as Class A Ordinary Shares and the Ordinary Shares then held by our Controlling Shareholder were reclassified as Class
+B Ordinary Shares. As a result, the issued share capital of the Company consisted of 9,450,000 Class A Ordinary Shares and 17,550,000
+Class B Ordinary Shares, details of which are as follows:
+
+ 
+
+ 
+ Name of Shareholder 
+ Number of Ordinary Shares Owned 
+ Percentage Ownership 
+
+ 
+ 
+ Class A 
+ Class B 
+ Issued share capital 
+ Total voting power 
+
+ 
+ MCL 
+ - 
+ 17,550,000 
+ 65.00% 
+ 97.38%
+
+ 
+ Many Trillion International Limited 
+ 1,350,000 
+ - 
+ 5.00% 
+ * 
+
+ 
+ Express Essential Holdings Limited 
+ 1,350,000 
+ - 
+ 5.00% 
+ * 
+
+ 
+ Winlover Limited 
+ 1,350,000 
+ - 
+ 5.00% 
+ * 
+
+ 
+ Ace Miracle Group Limited 
+ 2,700,000 
+ - 
+ 10.00% 
+ * 
+
+ 
+ Able Talent Business Limited 
+ 1,350,000 
+ - 
+ 5.00% 
+ * 
+
+ 
+ Essential Quality Limited 
+ 810,000 
+ 
+ 3.00% 
+ * 
+
+ 
+ MCA Limited 
+ 540,000 
+ 
+ 2.00% 
+ * 
+
+ 
+
+ 
+
+*Less
+than 1% of our total voting power.
+
+ 
+
+ 69
+
+ 
+
+ 
+
+ 
+
+The
+following diagrams illustrate our corporate and ownership structure as of the date of this prospectus and immediately upon the completion
+of this offering.
+
+ 
+
+Pre-Offering
+(1)
+
+ 
+
+ 
+ Mr.
+ NG Hon Kin
+ 
+ 
+ Ms.
+ HUANG Hsi En
+ 
+ 
+ 
+ 
+ Many
+ Trillion Int l Ltd. (BVI) 
+
+ 
+ 
+ 99%
+ 
+ 
+ 
+ 1%
+ 
+ 
+ 
+ 5%
+ (4)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Sirius
+ Capital Holdings Ltd. (HK)
+ 
+ Class
+ A
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Express
+ Essential Holding Ltd. (BVI)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+ 
+
+ 
+
+ 100%
+ 
+ 5%
+ (5)
+
+ 
+ 
+ 
+ Ideal
+ Success Limited (Cayman)
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ Sirius
+ Capital Investment Ltd. (HK)
+ 
+ 
+ Winlover
+ Ltd. (BVI)
+
+ 
+ 
+ 
+ 
+ 100%
+ 
+ 
+ 
+ 5%
+ (6)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 10%
+ 
+ Class
+ A
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Essential
+ Quality Ltd. (BVI)
+
+ 
+ 
+ 
+ Master
+ Centric Ltd. (BVI)
+ 
+ 
+ Ace
+ Miracle Group Ltd. (BVI)
+ 
+ 3%
+ (7)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 65%
+ (2)
+ 
+ 
+ 
+ 10%
+ (3)
+ 
+ 
+ MCA
+ Ltd. (HK)
+
+ 
+ 
+ 
+ 
+ Class
+ B
+ 
+ 
+ 
+ Class
+ A
+ 
+ 2%
+ (8)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Able
+ Talent Business Ltd. (BVI)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 5%
+ (9)
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ MEDI
+ Group Limited (Cayman)
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 100%
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ MEDI
+ Trade Holding Limited (HK)
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 100%
+ 
+ 
+ 100%
+ 
+ 100%
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Grand
+ Century Holding Co., Ltd. (HK)
+ 
+ Doctor s
+ Concept Medical and Cosmetics Co., Ltd. (HK)
+ 
+ MEDI
+ Trade Corporation Limited (HK)
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+
+ 
+
+ 
+
+ 
+ Note: 
+ 
+
+ 
+ (1)
+ Based on 27,000,000 Ordinary Shares, consist of 9,450,000 Class
+ A Ordinary Shares and 17,550,000 Class B Ordinary Shares, issued and outstanding immediately prior to the offering.
+
+ 
+ (2)
+ Represents 17,550,000 Class B Ordinary Shares.
+
+ 
+ (3)
+ Represents 2,700,000 Class A Ordinary Shares.
+
+ 
+ (4)
+ Represents 1,350,000 Class A Ordinary Shares.
+
+ 
+ (5)
+ Represents 1,350,000 Class A Ordinary Shares.
+
+ 
+ (6)
+ Represents 1,350,000 Class A Ordinary Shares.
+
+ 
+ (7)
+ Represents 810,000 Class A Ordinary Shares.
+
+ 
+ (8)
+ Represents 540,000 Class A Ordinary Shares.
+
+ 
+ (9)
+ Represents 1,350,000 Class A Ordinary Shares.
+
+ 
+ 
+
+ 70
+
+ 
+
+ 
+
+ 
+
+Post-Offering
+(assuming no exercise of the underwriters over-allotment option) (1)
+
+ 
+
+ 
+ Mr.
+ NG Hon Kin
+ 
+ 
+ Ms.
+ HUANG Hsi En
+ 
+ 
+ 
+ 
+ Many
+ Trillion Int l Ltd. (BVI)
+ 
+ 
+
+ 
+ 
+ 99%
+ 
+ 
+ 
+ 1%
+ 
+ 
+ 
+ 4.45%
+ (4)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Sirius
+ Capital Holdings Ltd. (HK)
+ 
+ Class
+ A
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Express
+ Essential Holding Ltd. (BVI)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 100%
+ 
+ 4.45%
+ (5)
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Ideal
+ Success Limited (Cayman)
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Sirius
+ Capital Investment Ltd. (HK)
+ 
+ 
+ Winlover
+ Ltd. (BVI)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 100%
+ 
+ 
+ 
+ 4.45%
+ (6)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 10%
+ 
+ Class
+ A
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Essential
+ Quality Ltd. (BVI)
+ 
+ 
+
+ 
+ 
+ 
+ Master
+ Centric Ltd. (BVI)
+ 
+ 
+ Ace
+ Miracle Group Ltd. (BVI)
+ 
+ 2.67%
+ (7)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 57.86%
+ (2)
+ 
+ 
+ 
+ 8.90%
+ (3)
+ 
+ 
+ MCA
+ Ltd. (HK)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Class
+ B
+ 
+ 
+ 
+ Class
+ A
+ 
+ 1.78%
+ (8)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Able
+ Talent Business Ltd. (BVI)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 4.45%
+ (9)
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ Class
+ A
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ MEDI
+ Group Limited (Cayman)
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 100%
+ 
+ 
+ 
+ 
+
+ 
+
+Public
+(New Issue)
+
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ MEDI
+ Trade Holding Limited (HK)
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 10.99%
+ (10)
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Class
+ A
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 100%
+ 
+ 
+ 100%
+ 
+ 100%
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ Grand
+ Century Holding Co., Ltd. (HK)
+ 
+ Doctor s
+ Concept Medical and Cosmetics Co., Ltd. (HK)
+ 
+ MEDI
+ Trade Corporation Limited (HK)
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+
+ 
+ Note: 
+ 
+
+ 
+ (1)
+ Based on 30,333,333 Ordinary Shares outstanding immediately after
+ the offering assuming the underwriter does not exercise the over-allotment option.
+
+ 
+ (2)
+ Represents 17,550,000 Class B Ordinary Shares.
+
+ 
+ (3)
+ Represents 2,700,000 Class A Ordinary Shares.
+
+ 
+ (4)
+ Represents 1,350,000 Class A Ordinary Shares.
+
+ 
+ (5)
+ Represents 1,350,000 Class A Ordinary Shares.
+
+ 
+ (6)
+ Represents 1,350,000 Class A Ordinary Shares.
+
+ 
+ (7)
+ Represents 810,000 Class A Ordinary Shares.
+
+ 
+ (8)
+ Represents 540,000 Class A Ordinary Shares.
+
+ 
+ (9)
+ Represents 1,350,000 Class A Ordinary Shares. 
+
+ 
+ (10)
+ Represents 3,333,333 Class A Ordinary Shares.
+
+ 
+ 
+
+An
+aggregate number of 4,272,222 Class A Ordinary Shares is being registered for resale under the Resale Prospectus, of which 4,050,000
+are held by the three of the seven former noteholders, representing all of the shares they hold in the Company, and 222,222 Class A Ordinary
+Shares to be converted from Class B Ordinary Shares are held by our Controlling Shareholder, representing 1.27% of the shares our Controlling
+Shareholder hold in the Company. The resale of their shares in the public market may take place after the completion of this offering.
+
+ 
+
+Our
+principal executive offices are located at Unit 15-16, 22/F., CEO Tower, 77 Wing Hong Street, Cheung Sha Wan, Kowloon, Hong Kong, and
+our telephone number is +852 2388 1121. Our registered office in the Cayman Islands is at the office of Ogier Global (Cayman) Limited,
+89 Nexus Way, Camana Bay, Grand Cayman, KY1-9009, Cayman Islands. We maintain a website at www.doctorsconcept.com.
+
+ 
+
+Our
+agent for service of process in the United States is Cogency Global Inc., located at 122 East 42nd Street, 18th Floor New York, NY 10168.
+
+ 
+
+ 71
+
+ 
+
+ 
+
+ 
+
+INDUSTRY
+OVERVIEW
+
+ 
+
+We
+are responsible for the information contained in this prospectus and any free writing prospectus we prepare or authorize. Unless otherwise
+expressly stated or the context otherwise requires, information and data relating to our industry, market and competitive position in
+this section are derived from an independent market research report obtained by us from MarketsandMarkets Research Private Limited (www.marketsandmarkets.com)
+("MnM") for a fee of US$4,500. The remaining information and data are sourced from publicly available information, industry
+and general publications and research, surveys and studies conducted by third parties. We believe our information sources are reliable
+but have not independently verified such data. The medical aesthetic services industry may not grow at the rate projected by these sources.
+Failure of the industry to grow at the projected rates may have a material and adverse effect on our business and the market price of
+our shares.
+
+ 
+
+Types
+of Beauty Services
+
+ 
+
+Beauty
+services comprise mainly normal beauty services and medical aesthetic services. Normal beauty services refer to facial, spa and massage
+services. Medical aesthetic services refer to procedures designed to improve appearance through restoration, reconstruction or alteration
+of the human body. They are non-essential medical procedures performed principally to improve people s quality of life and psychological
+well-being.
+
+ 
+
+Medical
+aesthetic services can be divided into surgical and non-surgical treatments. Surgical medical aesthetic services, often referred to as
+plastic surgeries, include procedures such as breast augmentation, face and body contouring, blepharoplasty, and rhinoplasty; whereas
+non-surgical medical aesthetic services are comprised of injection procedures and energy-based treatments.
+
+ 
+
+Surgical
+medical aesthetic treatments are traditional cosmetic surgeries performed on different body parts, such as removing extra fat and loose,
+lax skin, cutting and reshaping bones, and placing implants. Although their demand is not as high as that of non-invasive treatments,
+cosmetic surgeries like rhinoplasty and breast augmentation continue to have a steady demand.
+
+ 
+
+Non-surgical
+medical aesthetic treatments involve the use of non-surgical technologies to enhance the appearance of selected body parts. The more
+popular treatments include the following:
+
+ 
+
+ Skin
+ Improvement. These treatments are designed to reduce signs of aging, such as fine lines,
+ wrinkles, and sagging skin, as well as to remove scars and stretch marks. They are carried
+ out using (i) non-invasive procedures energy-based processes, such as laser, radiofrequency,
+ HIFU and intense pulsed light, and chemical peels; and (ii) mildly invasive procedures 
+ the injection of toxins and fillers. They are usually performed on the facial area but can
+ be applied to other body areas as well.
+
+ 
+
+ Body
+ Contouring. These treatments include non-invasive procedures such as cryolipolysis and
+ surgical procedures such as traditional liposuction.
+
+ 
+
+ Hair
+ Removal. These treatments remove visible body hair, such as body hair on legs and underarms,
+ through lasers.
+
+ 
+
+Normal
+beauty services are offered mainly through salons, beauty centers and spas. Surgical medical aesthetic procedures are performed mainly
+in clinics and hospitals, while non-surgical procedures are mainly performed in medical spas.
+
+ 
+
+We
+mainly focus on the growth of non-surgical medical aesthetic services, accompanied by a small portion of normal beauty services as part
+of our tailor-made package for our customers.
+
+ 
+
+Referencing to the classification
+by the Hong Kong government, our revenue from normal beauty services contributes more than 50% of our total revenue. With respect to
+normal beauty services, the more popular services include the following:
+
+ 
+
+ Skin
+ Care. This service is normally classified as facial treatment. It involves keeping the
+ skin clean and healthy-looking, moisturizing the skin, and edema removal. In most circumstances,
+ independent researches will cover mainly skincare products for self-use. Facial treatment
+ includes face massage and other traditional Chinese meridian massage techniques.
+
+ 
+
+ 72
+
+ 
+
+ 
+
+ 
+
+ Hair
+ Treatments. This service includes treatments ranging from deep conditioning treatments
+ to scalp massages. There are many different types of treatments designed to improve health
+ and appearance of looks. Regular hair treatments can help to repair damage, reduce frizz,
+ and add shine and volume to hairs.
+
+ 
+
+ Body
+ Hairs Removal. This treatment mostly applies wax to remove excess body hair. Waxing keeps
+ the skin smooth and hair-free for weeks at a time, whether it is a bikini wax, leg wax, or
+ another type.
+
+ 
+
+ Body
+ Scrubs. This treatment uses body scrub to exfoliate
+ and soften the skin. Regular body scrubs help eliminate dead skin cells, improve skin texture,
+ and leave skin feeling soft and smooth, whether using a sugar scrub, salt scrub, or another
+ type.
+
+ 
+
+ Massage.
+ This treatment typically involves the use of essence oil to help customers relax fatigue.
+
+ 
+
+Global
+Medical Aesthetic Services Industry
+
+ 
+
+The
+global market size of the medical aesthetic services industry was US$15,304 million in 2023 and is projected to expand at a CAGR of 11%
+from 2023 to 20284. This growth is driven by an increased societal focus on personal appearances and a rising demand for aesthetic
+procedures. Non-surgical procedures have experienced higher growth than surgical ones and this trend is projected to continue.
+
+ 
+
+ 
+
+Source:
+MarketsandMarkets.
+
+ 
+
+ 73
+
+ 
+
+ 
+
+ 
+
+The
+growth of the industry is expected to be driven by increasing popularity in the following categories:
+
+ 
+
+ non-invasive
+ and minimally invasive aesthetic procedures;
+
+ 
+
+ aesthetic
+ procedures tailored for the geriatric population;
+
+ 
+
+ advanced
+ and user-friendly medical aesthetic products; and
+
+ 
+
+ aesthetic
+ treatments tailored for men.
+
+ 
+
+Beauty
+Services in Hong Kong
+
+ 
+
+Non-surgical
+medical aesthetic services in Hong Kong are relatively new. Skin treatments using injections and energy-based processes were made available
+to the mass market in around 2013. Body sculpturing and fat melting treatments were made available to the mass market in around 2016
+and 2018, respectively.
+
+ 
+
+An
+emerging culture in Hong Kong that prioritizes appearance and wellness has driven increased local demand for beauty treatments. The Hong
+Kong cosmetics market, as estimated by the US International Trade Association ("ITA"), had a total value of US$2.45 trillion
+in 2023. For non-medical aesthetic market, it is expected to grow from US$1,997.89 million in 2018 to US$2,480.99 million in 2028. Standalone
+statistics for beauty services provided by beauty salons are rarely available.
+
+ 
+
+ 
+
+ 74
+
+ 
+
+ 
+
+ 
+
+ 
+
+Based
+on an analysis of the research result by the Hong Kong Trade Development Council on August 14, 2023, about 40% of the beauty market in
+Hong Kong was medical cosmetic centers.
+
+ 
+
+The
+Hong Kong medical aesthetic services market has experienced moderate growth over the past few years. This growth is mainly attributable
+to the following:
+
+ 
+
+ MnM
+ projected that an increase in disposable income allows people to spend more on non-essential
+ services such as aesthetic treatments while the Company believes that customers spending
+ patten will not be exactly the same in a short period after COVID-19 pandemic until
+ mid-2025.
+
+ 
+
+ 75
+
+ 
+
+ 
+
+ 
+
+ 
+
+ An
+ aging population increases demand for anti-aging treatments. Based on statistics released
+ by the Census and Statistics Department ("CSD") on August 15, 2023, the provisional
+ estimate of Hong Kong population was 7,498,100 at mid-2023. Out of this approximately 7.5
+ million, around 52% the population, based on 2021 population census, is female. Among the
+ female population, approximately 56% belong to the target customer group (aged 15 to 65)
+ for the beauty industry, i.e. 2.18 million persons. Public confidence in the safety of medical
+ aesthetics has increased as technology progresses.
+
+ 
+
+ People
+ want to look good when posting photos and videos on social media.
+
+ 
+
+ The
+ number of target consumers is increasing as more men become interested in beauty treatments.
+
+ 
+
+ An
+ energetic and youthful appearance symbolizes health and wellness, which is a global cultural
+ value.
+
+ 
+
+ Hong
+ Kong is one of the notable destinations in Asia for quality aesthetic treatments.
+
+ 
+
+The
+increase in promotions, including advertisements on Facebook and various media channels, along with rising awareness for personal grooming
+and confidence in spending, is expected to further support the growth of medical aesthetic market in the near future. According to the
+CSD, in mid-2023, 29% of the total population, or 2.18 million people, were female from age 15 to age 59. They are the target customers
+for beauty services. Similar age groups in mainland China, Taiwan and Singapore are also target customers.
+
+ 
+
+According
+to Statista Market Insights, an independent research company, the Hong Kong beauty and personal care market is projected to grow at a
+CAGR of 1.9% between 2024 and 2028, and the skincare segment, one of the subcategories within the market, is projected to grow at a CAGR
+of 1.81% over the same period. (Cosmetics market and skincare market are defined by Statista to mean a mixture of product and services.
+Cosmetics are products used to improve or enhance appearance, while skincare products are designed to care for and protect the skin.)
+
+ 
+
+ 76
+
+ 
+
+ 
+
+ 
+
+ASIA
+PACIFIC COUNTRIES TO WITNESS HIGHEST GROWTH RATE DURING FORECAST PERIOD
+
+ 
+
+ 
+
+Source:
+MarketsandMarkets.
+
+ 
+
+Market
+Challenges
+
+ 
+
+There
+are over 6,000 beauty centers providing non-surgical medical aesthetic services in Hong Kong, and the market is relatively fragmented.
+The challenges on non-surgical medical aesthetic services providers in Hong Kong include:
+
+ 
+
+ compliance
+ costs due to increasingly stringent regulatory and safety rules;
+
+ 
+
+ risk
+ of liability arising from latent defects of devices, inadvertent errors in clinical procedures,
+ and side effects experienced by consumers with pre-existing conditions;
+
+ 
+
+ competition
+ from alternative beauty and cosmetic products, as well as home-use beauty and aesthetic devices;
+ and
+
+ 
+
+ reduced
+ consumer base as such services are discretionary spending and Hong Kong is currently experiencing
+ a downward economic cycle.
+
+ 
+
+ 77
+
+ 
+
+ 
+
+ 
+
+BUSINESS
+
+ 
+
+The Class A Ordinary Shares being
+offered in this prospectus are those of MEDG, or the Company. The Company is a holding company with no material operations of its own.
+We conduct our operations through GCHL. Unless the context requires otherwise, GCHL is the entity that contracts with third parties in
+the ordinary course of business, the holder of our business licenses and permits, and the legal owner of our business assets, other than
+our intellectual properties, which are registered under DCMCL.
+
+ 
+
+Overview
+
+ 
+
+We
+are a beauty and personal care service company offering a broad range of beauty and spa services for customers in Hong Kong under the
+brand name "Doctor s Concept". Founded in 2004, we estimate that we have served more than 50,000 customers and currently
+have approximately 30,000 customers on file. We offer two categories of services: medical aesthetic services and normal beauty services
+(also known as normal beauty treatments). Based on government statistical classification, the majority of our revenue in the past 20
+years has been derived from normal beauty services. Our goal is to focus on the growth of medical aesthetic services while continuing
+to offer normal beauty services.
+
+ 
+
+As
+of June 30, 2024, we had approximately 2,600 customers holding one or more of our unexpired prepaid packages, most of whom are repeat
+customers who made their first purchases with us more than three years ago.
+
+ 
+
+Our
+services are rendered through our three services centers with an aggregate gross floor area of 12,856 sq. ft. They are conveniently located
+near to where our customers work, shop and live, with early morning and late evening opening hours to accommodate a variety of schedules.
+Our service centers are designed and staffed to help customers achieve their physical goals in a calm and luxurious environment.
+
+ 
+
+We
+target consumers in the middle market. Our value proposition is to deliver quality aesthetics solutions tailored to the unique needs
+of each customer at competitive prices. Our strategy is to differentiate ourselves by offering high-quality treatments and personalized
+services at reasonable prices rather than generic services at discounted prices. To cultivate customer loyalty, we strive to nurture
+a sense of belonging by personalizing the visitor experience so that our customers perceive our brand as one that aligns with their values
+and lifestyle.
+
+ 
+
+We
+have experienced revenue fluctuation since the COVID-19 pandemic measures were lifted in early 2023. Our total revenue for the years
+ended June 30, 2024 and 2023 was US$6.11 million and US$8.02 million, respectively, representing a year-over-year decrease
+of 24%.
+
+ 
+
+Competitive
+Strengths
+
+ 
+
+We
+believe the following competitive strengths are essential to our success and differentiate us from our competitors.
+
+ 
+
+High
+customer retention rate
+
+ 
+
+Through our years
+of dedication to cosmetology and tailor-made services, we have developed a loyal and stable customer base. As of December 31, 2024, approximately
+2,600 customers (unaudited) were holding one or more of our unexpired prepaid packages. Nearly 100.0% of these customers are repeat customers.
+We believe our customer base is crucial for the success of any business expansion. Long-term customers do not only provide a stable income
+stream, but also offer valuable data insights into their service patterns and behavioral preferences for future marketing purposes.
+
+ 
+
+ 78
+
+ 
+
+ 
+
+ 
+
+Upscale
+customer experience
+
+ 
+
+We believe our
+loyal customer base is a result of our client-centric services. Our service centers are located in prime commercial districts across
+Hong Kong. Each center is decorated in a low-key luxury style to create a soothing atmosphere for clients. In addition, we offer professional
+training to all frontline beauty professionals and implement a compensation structure that strongly incentivizes them to provide a warm
+and welcoming environment for our customers, whether they are receiving treatments, consultation, or purchasing new prepaid packages.
+
+ 
+
+Broad
+range of beauty treatments
+
+ 
+
+The medical aesthetic
+services industry is characterized by rapid technological advancements, we introduce new treatment procedures from time to time in response
+to the evolving treatment technologies and changing market trends. We offer a wide array of non-medical cosmetology services using procedures
+and technologies with different features and functionalities. In order to stay current with the industry and satisfy the rapidly evolving
+market interests in new procedures and technologies, our management and beauty professionals draw inspirations from international publications
+and reach out to suppliers to design and diversify our service offerings, maintaining a fresh experience for our customers.
+
+ 
+
+Stringent
+quality control
+
+ 
+
+Safe and high-quality
+services are utmost to our business philosophy. We have stringent quality control measures in the selection of suppliers, development
+and design of treatments, and the rendering of services. We also conduct regular and ad hoc inspections and secret customer visits
+to assess service standards at our service centers, focusing on cleanliness, consumable expiry dates, staff appearance, medicine storage
+security, and comprehensive quality control. We believe our loyal customer base is a testimony to our dedication to maintain high-quality
+services.
+
+ 
+
+Business
+Strategies
+
+ 
+
+Our
+principal business objective is to strengthen our market position and expand our market share. We intend to achieve our objectives through
+the following strategies:
+
+ 
+
+Expand
+our geographical footprints
+
+ 
+
+We
+currently have three service centers in distinct geographical districts of Hong Kong, compared with a peak of 6 service centers in 2019
+shortly prior to the COVID pandemic. After market activities resumed when the Hong Kong government ended all the COVID restrictions in
+early 2023, we began implementing plans to gradually restore the number of service centers to pre-COVID-19 level, so that customers who
+live and work in different parts of the city can enjoy our services with minimal travel time. We believe our expanded services will allow
+us to fully utilize our bigger network. As we mainly target middle class customers, our new centers will likely be located in new business
+districts in Hong Kong.
+
+ 
+
+In
+addition, we believe that with our extensive industry knowledge, we are ready to explore overseas markets with similar demographic, profiles
+and cultures. In particular, we are interested in exploring the feasibility of establishing our footprints in Malaysia and Singapore,
+where demand for high-end services in these two countries is growing.
+
+ 
+
+Broaden
+our service offerings to cater to high-growth segments
+
+ 
+
+We
+intend to continue expanding the scope of our service offerings. In particular, we are developing new services tailored for male customers,
+one of the fastest growing segments in the medical aesthetic services industry. Separately, we will continue to keep abreast of the latest
+trend in skin care regimens to meet our clients evolving needs. We organize internal meetings from time to time where our therapists
+share their experience in dealing with customers feedback, exchange ideas on treatments and products, and maintain close relationships
+with suppliers of treatment devices.
+
+ 
+
+ 79
+
+ 
+
+ 
+
+ 
+
+Upgrade
+and broaden our service offerings
+
+ 
+
+We
+intend to focus on non-medical aesthetic skin treatments. Non-medical aesthetic treatments are non-invasive or minimally invasive procedures
+that do not require to be performed by registered medical professionals. The medical aesthetic services industry is characterized by
+rapid technological advancements. To maintain competitiveness, including defending ourselves against the growing popularity of home-use
+skin treatment devices, we closely monitor the development of advanced medical grade equipment for skin treatments and enhancements.
+For example, we maintain constant dialogues with various foreign equipment suppliers on new or enhanced technologies, procedures and
+devices so that we can design and develop new treatments customized to our customer profiles. As we continue to expand, we will make
+additional investments in our software technology to achieve real-time monitoring of our daily operations, centralize information exchange,
+integrate different operational functions, and collect operational data. We believe our data analytics strategy will help us identify
+changes that could increase visit stream, uncover cross-selling opportunities, and improve operational efficiency.
+
+ 
+
+Recruit,
+train and maintain a team of experienced and dedicated management and senior beauty professionals
+
+ 
+
+We
+attribute our success, among other factors, to the vision of Mr. Ng Hon Kin, our founder and CEO, and the talents of our management and
+beauty professionals. We currently plan to open one new medical aesthetic center in a prime location in Kowloon and expand our beauty
+professional team from one medical practitioner and 19 therapists to three medical practitioners and 40 therapists. In addition, we will
+continue to attract and retain experienced employees through training and professional development, such as encouraging and subsidizing
+our medical practitioners to attend overseas medical aesthetic conferences and expositions.
+
+ 
+
+Service
+Offerings
+
+ 
+
+Our beauty services
+consist of two categories: medical aesthetic treatments/services and normal beauty treatments/services. For the years ended June 30,
+2024 and 2023, most of our revenue was derived from normal beauty treatments. Our strategy is to focus on the growth of our medical aesthetic
+treatments while continuing to offer normal beauty treatments. Normal beauty treatments have a higher gross margin and provide an important
+flatform to acquire new customers by earning their trust through quality customer services. They also help build our image as a quality
+provider with a comprehensive range of beauty services.
+
+ 
+
+Our
+medical aesthetic services are designed to improve the skin conditions of our customers through energy-based procedures or injection
+procedures, including:
+
+ 
+
+ Facial
+ lines reduction. This type of treatment involves the injection of Botox or Restylane
+ into the skin to relax muscles that contract and crease the skin over time, such as frown
+ lines, crow s feet, and forehead line. Both injectables are neurotoxins approved by
+ the U.S. Food and Drug Administration ("U.S. FDA"). They provide temporary improvement
+ in the appearance of moderate to severe glabellar lines associated with corrugator and/or
+ procerus muscle activities.
+
+ 
+
+ Facial
+ contouring. This type of treatment involves the injection of Sculptra into the skin to
+ fill in wrinkles or folds, such as forehead, cheek, eyelash, chin and areas that naturally
+ lose volume as we age, such as cheek, to enhance natural contours. Sculptra is a dermal filler
+ approved by the U.S. FDA. It serves as a scaffolding for new collagen production to take
+ place.
+
+ 
+
+ Photo-rejuvenation.
+ This type of treatment uses lasers, intense pulse light, or photodynamic therapy to treat
+ skin conditions and remove effects of photoaging such as wrinkles, spots, and textures. In
+ certain service package, we also use NMN products along with rejuvenation treatment to achieve
+ anti-aging effect for customer s muscle.
+
+ 
+
+ Chemical
+ peel. This type of treatment improves and smooths skin quality by removing the outermost
+ layers of the skin. The skin on the face is most commonly treated, but peels can also be
+ performed on the body.
+
+ 
+
+ Body
+ contouring. This type of treatment reduces subcutaneous fact in selected body areas,
+ such as fat on the abdomen and flanks. We apply controlled heat generated from machine using
+ HIFU technology to break down the fat cells in the targeted regions.
+
+ 
+
+ 80
+
+ 
+
+ 
+
+ 
+
+Our
+normal beauty services are designed to improve the skin conditions of our customers through a variety of facial and body related procedures.
+Our treatments in this category include:
+
+ 
+
+ Body
+ massage. This treatment involves the use of aromatic oil to perform a full-body massage
+ on the customer, with a focus on lymph modes. The procedure is designed to help relax the
+ customer, as well as improve the general health and skin condition.
+
+ 
+
+ Moisturizing
+ facial. This treatment involves the use of various beauty creams and gels in combination
+ with massaging the face. The procedure is designed to help improve the moisture level of
+ and the overall general condition of the face of the customers.
+
+ 
+
+ Skin
+ whitening. A service applying Cellec V, a color laser (or photon pulse light) equipment
+ to whiten skin. We mainly use this to help customers achieve whiten arms. The use of Cellec
+ V equipment should, in our view, be classified as medical aesthetic.
+
+ 
+
+As
+of the date of this prospectus, all of our services are catered to female customers. In the future, we intend to expand our service offerings
+to include treatments designed for male customers.
+
+ 
+
+Under
+Hong Kong law, none of the procedures above are medical procedures. Most of these procedures in our service centers are performed by
+beauty professionals who have completed mandatory internal training by our registered medical practitioner, whom we partner with, and
+his clinics are based in our 3 service centers. Our customers may elect to have treatments performed by our registered medical practitioner
+at a higher price. Terms of such arrangements will be set forth in the customers prepaid packages.
+
+ 
+
+Service
+Centers
+
+ 
+
+Management
+and administrative staff work at our headquarters, while beauty professionals render their services through our three service centers.
+Our medical practitioner, Dr. Pang Sai Yau, offers his services in all three service centers.
+
+ 
+
+Our
+three service centers are located in Langham Place in Mongkok, Kowloon; World Trade Centre in Causeway Bay, Hong Kong Island; and Kwong
+Wah Plaza in Yuen Long, New Territories. All are situated in premier office buildings in prime locations within their respective districts.
+The five premises, including our headquarters, have an aggregate gross floor area of 17,208 sq. ft. We have consolidated our office and
+training premises into one. As of December 31, 2024, the four premises (three shops and one office) have an aggregate gross floor area
+of approximately 15,000 sq. ft. All of them are decorated in a low-key luxury style to provide a soothing atmosphere for our clients.
+See "Recent Development – Geographic Optimization of Service Locations" on page 8 and 83 of this prospectus
+for more detailed discussion on the closure of Yuen Long Shop.
+
+ 
+
+ 81
+
+ 
+
+ 
+
+ 
+
+Below
+is the map showing the locations of our three service centers in Hong Kong.
+
+ 
+
+ 
+
+Source:
+Google Map
+
+ 
+
+ 
+ 
+ 
+ Langham
+ Place ( ), Mongkok, Kowloon
+
+ 
+ 
+
+ 82
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+
+ World
+ Trade Centre ( ), Causeway Bay, Hong Kong
+
+ 
+ 
+
+ 
+ 
+
+ 
+ 
+ 
+ Kwong
+ Wah Plaza, Yuen Long ( ), New Territories.
+
+ 
+ 
+
+Recent Development –
+Geographic Optimization of Service Locations 
+
+ 
+
+Our customers
+located near northern Hong Kong have increasingly turned to
+service providers in the mainland China, due to convenience of cross border access, resulting in a loss of customers in our Yuen Long
+operations. Consequently, we plan to close down our Yuen Long Shop (located at office No. 6-7 and 8-9, 8/F, Kwong Wah Plaza, 11 Tai Tong
+Road, Yuen Long, New Territories) on September 30, 2025. In preparation for this closure, we, together with Be Health Company Limited
+with whom we share the lease in Yuen Long, entered into a Transfer Agreement with Beauty Plus Limited on July 28, 2025 (the "Transfer
+Agreement"). Under the Transfer Agreement, among other items, the furniture, renovation, beds for beauty treatments of the Yuen
+Long Shop will be sold to Beauty Plus Limited at a total cost of HKD330,000. The Transfer Agreement is subject to a condition precedent
+that the property owner of the Yuen Long Shop signs a new lease agreement with Beauty Plus Limited at a specified rental amount.
+
+ 
+
+Customer
+Sales
+
+ 
+
+In
+addition to our sales personnel, our beauty professionals/beauticians also promote our services after delivery of treatments. Both teams
+have received internal training designed to help them building long-term customer relationships through quality and customized services.
+Each of our new customers is given a free consultation session with a sales personnel, who will be the relationship manager for that
+customer. During this session, the sales personnel will collect information needed to design a treatment plan tailored to the customer s
+needs, such as the client s objectives, allergy conditions, medical history, and budget.
+
+ 
+
+We sell our services
+as packages and do not offer standalone treatment sessions except for marketing purposes or under exceptional circumstances. A package
+usually consists of a combination of different types of treatment, with each designed to be rendered in multiple sessions over a period
+of time. The validity period of our packages generally ranges up to 24 months from the date of purchase. We may extend the validity period
+of unutilized packages for our clients on a case-by-case basis at our sole discretion.
+
+ 
+
+Payment
+for a package is generally made in a lump sum in advance, in the form of an invoice countersigned by the customer. The invoice sets forth
+the contents of the package and our standard terms and conditions. We do not sell our services on credit, but customers may choose to
+pay for their packages in multiple instalments.
+
+ 
+
+We
+take customer complaints seriously. Upon receiving an unfavorable feedback, our complainant relationship manager will conduct investigation
+of the complaint. We maintain record of these feedback and the beauty professionals involved, so that we can discuss them during regular
+management meetings and make changes to minimize similar incidents in the future. The relationship manager will seek to address the concerns
+raised by the customer, sometimes by giving customers the option to amend the prepaid packages terms, such as transferring from one treatment
+type to another, or, in extreme cases, a full or partial refund.
+
+ 
+
+We
+have communicated with all of the sales personnel and our beauty professionals that unfair trade practices (such as using harassment,
+coercion, or undue influence to impair customers freedom of choice) are unlawful and are strictly prohibited. We require all consultation
+sessions to last no more than one hour.
+
+ 
+
+ 83
+
+ 
+
+ 
+
+ 
+
+Marketing
+
+ 
+
+We
+generally promote our services to our target customers through printed and digital publications, outdoor billboards, telemarking, social
+media, and our website. We believe that many of our new customers react to our advertisements and contact our sales staff to consult
+about services that appear suitable. That said, we believe that one of the most important marketing channel is the impeccable services
+we provide. We believe word of mouth is the most effective marketing channel, as returning customers may refer our services to their
+friends, family and work colleagues, and such referrals carry far greater weight to our target customers than paid advertisements.
+
+ 
+
+We
+sometimes organize promotional campaigns, typically during holidays, to attract new customers. Some of our campaign events include participating
+in exhibitions; organizing road shows in popular shopping arcades near our service centers; and hosting activities to raise public awareness
+of physical appearance. Promotional discounts are a common campaign activity. These include partnering with credit card companies, such
+as Citibank, HSBC and Hang Seng Bank, as well as issuing free trial service coupons through social media.
+
+ 
+
+We also contact current
+and former customers from our own database to inform them of new products, services and promotional offers. To better understand our
+target customers and market trends, we sometimes engage independent marketing consulting firms to conduct telemarketing, consumer surveys
+and promotional campaigns in street booths. This helps us design, price and market our services based on the service patterns and behavioral
+preferences of the middle-market consumers. We also leverage partnerships with various banks in Hong Kong with respect to their credit
+cards.
+
+ 
+
+We carry out annual budgeting
+for our marketing expenses based on factors such as historical data analysis of the cost and effectiveness of each of our advertising
+medium, competitors advertising and promotional activities, and sales targets.
+
+ 
+
+Employees
+
+ 
+
+The
+following table sets forth a breakdown of our employees by functions and geographical locations as of June 30, 2025:
+
+ 
+
+ 
+ Function 
+ Head Office 
+ Mongkok Shop 
+ Causeway Bay Shop 
+ Yuen Long Shop 
+ Total 
+
+ 
+ Management 
+ 5 
+ 2 
+ 2 
+ 1 
+ 10 
+
+ 
+ Beauty professionals 
+ - 
+ 6 
+ 7 
+ 5 
+ 18 
+
+ 
+ Administrative staff 
+ 2 
+ 6 
+ 2 
+ 1 
+ 11 
+
+ 
+ Operation supporting staff 
+ 2 
+ - 
+ - 
+ - 
+ 2 
+
+ 
+ Medical practitioner 
+ 1 
+ - 
+ - 
+ - 
+ 1 
+
+ 
+ Total 
+ 10 
+ 14 
+ 11 
+ 7 
+ 42 
+
+ 
+
+ 
+
+Our
+success is dependent on our employees. We prefer to recruit employees through referrals, but we also interview candidates who respond
+to our online job advertisements. We endeavor to offer competitive wages and benefits.
+
+ 
+
+We offer employees training
+to enhance their skills and knowledge, enabling them to build their own careers in the cosmetology industry. Regular training for our
+employees includes new employee orientation, post-promotion training, and general monthly, quarterly and annual training. We provide
+additional training whenever we purchase new equipment. We believe training helps our employees improve their service performance, which
+ultimately increases their loyalty to the Company. We have developed a series of training programs tailored to the needs and requirements
+of their work, aligned with their roles and responsibilities. Most training is undertaken by our internal staff, but when necessary for
+effectiveness, outside professionals are also hired to conduct training sessions.
+
+ 
+
+We plan to cease our operation
+in Yuen Long shop on September 30, 2025. After the closure, we will only have 35 employees until we open a new shop.
+
+ 
+
+ 84
+
+ 
+
+ 
+
+ 
+
+We
+conduct an annual review of the performance of our employees and keep track of customer feedbacks on them. To reduce any undue incentive
+for excessive selling of prepaid packages, we have designed a remuneration scheme that takes into account of a number of performance
+benchmarks, among which sales origination is only one component.
+ 
+
+Supplies
+
+ 
+
+All
+of our injectables, such as BOTOX, have been approved by national government agencies such as the U.S. FDA. All of our medical equipment,
+such as laser, bear CE marks or substantially equivalent certifications.
+
+ 
+
+We
+currently, as of June 30, 2025, have 141 major treatment devices, details of which are set forth below.
+
+ 
+
+ 
+ 
+ Laser 
+ Radio 
+ frequency 
+ HIFU 
+ Normal 
+ Total 
+
+ 
+ Mongkok 
+ 6 
+ 6 
+ 4 
+ 46 
+ 62 
+
+ 
+ Causeway Bay 
+ 6 
+ 4 
+ 4 
+ 24 
+ 38 
+
+ 
+ Yuen Long* 
+ 6 
+ 3 
+ 2 
+ 30 
+ 41 
+
+ 
+ 
+ 18 
+ 13 
+ 10 
+ 100 
+ 141 
+
+ 
+
+ 
+
+*
+We will cease operation at Yuen Long shop on September 30, 2025. All equipment from Yuen Long shop will be evenly relocated to Mongkok
+shop and Causeway Bay shop.
+
+ 
+
+Our
+major supplies are treatment consumables, including injectables, clinic supplies, skin care products and medications. They include some
+of the prevailing treatment injectables produced by international pharmaceutical companies, such as BOTOX , Dysport and SCULPTRA .
+We also carry a small amount of high-end skin products manufactured in the United States, Italy and France. These products are usually
+sold or included as gifts as part of our prepaid packages. We store our supplies at our service centers according to the recommended
+storage conditions.
+
+ 
+
+Injectables
+used in our treatments and skin care products are sourced from third party distributors, who are usually engaged by pharmaceutical companies,
+in line with the common market practice. We settle payments with these distributors in Hong Kong dollars. The average credit period on
+purchase of goods is 30 days.
+
+ 
+
+Our
+operations are centralized using a point of sale (POS) system, namely CARE, which is developed by us to suit our business needs. The
+customized system allows our staff to initiate, amend and cancel treatment bookings; respond to customer enquiries regarding the status
+of their prepaid packages; and monitor inventory of treatment consumables. It also allows our management to analyze sales data such as
+popularity of treatments and customer spending patterns; monitor utilization of our service centers and performance of our beauty professionals;
+and access our financial data in real time.
+
+ 
+
+Research
+and Development
+
+ 
+
+We do not engage in any
+proprietary medical aesthetic research and development. To remain competitive, we must keep ourselves abreast of the latest technologies.
+Our management attends industry conferences, seminars and workshops in Hong Kong and overseas, as well as seminars organized by our suppliers
+on topics such as injection procedures and energy-based procedures. We will also be approached by suppliers of treatment devices, treatment
+consumables and skin care products and are given samples for trial. We constantly conduct feasibility studies for any suitable products,
+as well as market research on the latest and prevailing treatment technologies.
+
+ 
+
+When deciding whether
+to introduce a new treatment, we take into account factors such as efficiency, safety, market demand, and potential synergy with our
+other service offerings.
+
+ 
+
+ 85
+
+ 
+
+ 
+
+ 
+
+Quality
+Assurance
+
+ 
+
+Providing quality non-surgical
+medical aesthetic services is one of our management priorities. We implement comprehensive and stringent quality assurance and control
+measures in the recruitment of beauty professionals. We assess, among other factors, their professional qualifications, relevant job
+experience, as well as character and integrity.
+
+ 
+
+We
+partner with a medical practitioner, Dr. Pang Sai Yau, under a cooperation agreement. As stipulated in the agreement, Dr. Pang carries
+out consultation services, treatment procedures that are required to be performed by medical practitioners under relevant law, and minimally
+invasive treatment procedures which results are closely tied to the skills of the therapist. Other medical aesthetic treatments, such
+as energy-based procedures, are performed based on our medical practitioner s specifications by experienced beauty professionals
+who have received rigorous and mandatory training.
+
+ 
+
+We
+were granted the Enterprise Quality Service Award by the International Aestheticians Chamber of Commerce (INTACC) in 2019.
+
+ 
+
+Our
+three service centers are certified by Galderma, a Swiss pharmaceutical company specializing in dermatological treatments and skin care
+products. We were recognized by Galderma as a Top Ten Sales Achievement Aesthetic Centre in Hong Kong for the years 2023 and 2024 for
+our use of their proprietary products Dysport and Sculptra.
+
+ 
+
+Safety
+and Environmental
+
+ 
+
+Our
+beauty professionals are required to follow our comprehensive operational safety guidelines on the when of services. Before using any
+their use of any medical treatment devices, they must explain the sensation that the customers may feel upon the application of treatment
+devices on the skin and obtain the customers written consent. There are also other pre- and post-procedural examination of the customer
+and emergency response protocols that our beauty professionals must follow.
+
+ 
+
+None
+of the injectables and other consumables used in our treatments are classified as hazardous materials that would require special disposal
+procedures.
+
+ 
+
+In
+the past five years, there have not been any accidents at our premises causing injuries to our customers or employees.
+
+ 
+
+ 86
+
+ 
+
+ 
+
+ 
+
+Intellectual
+Property
+
+ 
+
+We
+consider trademarks, trade secrets, domain names, copyrights, know-how, and similar intellectual properties critical to our business.
+As of the date of this prospectus, we have six trademarks and one domain name registered with the Trade Marks Registry of the Intellectual
+Property Department of Hong Kong. The tables below set out their details.
+
+ 
+
+ 
+ Trademark
+ 
+ Registered
+ owner
+
+ 
+ 
+
+ 
+
+ 
+ Doctor s
+ Concept Medical and Cosmetics Company Ltd.
+
+ 
+ 
+
+ 
+
+ 
+ Doctor s
+ Concept Medical and Cosmetics Company Ltd.
+
+ 
+ 
+
+ 
+
+ 
+ Doctor s
+ Concept Medical and Cosmetics Company Ltd.
+
+ 
+ 
+
+ 
+
+ 
+ Doctor s
+ Concept Medical and Cosmetics Company Ltd.
+
+ 
+ 
+
+ 
+
+ 
+ Doctor s
+ Concept Medical and Cosmetics Company Ltd.
+
+ 
+ 
+
+ 
+ Domain
+ name
+ 
+ Company
+
+ 
+ www.doctorsconcept.com
+ 
+ Grand
+ Century Holding Company Ltd.
+
+ 
+ 
+
+ 87
+
+ 
+
+ 
+
+ 
+
+Despite
+our efforts to protect our proprietary rights, unauthorized parties may attempt to copy or otherwise obtain and use our intellectual
+properties. For further information, see "Risk Factors—Risks Related to Our Business and Industry — We may fail
+to protect our trade secret and know-how or pursue infringement actions on our other intellectual properties."
+
+ 
+
+Seasonality
+
+ 
+
+With
+the exception of relatively low sales in January or February during the Chinese New Year holidays, our sales are not subject to any material
+seasonal fluctuations.
+
+ 
+
+Insurance
+
+ 
+
+We
+maintain insurance coverage for our premises, employee safety, and institutional professional indemnity insurance in respect of the provision
+of medical aesthetic services. In addition, Dr. Pang Sai Yau, as a registered medical practitioner, maintains professional malpractice
+liability insurance, which includes indemnity, advice and legal representation in relation to claims, investigations and proceedings
+arising from or in connection with his professional practices. However, there is no assurance that such insurance coverage will adequately
+protect us from the risks involved in our business operations. For further information, see "Risk Factors — Risks Relating
+to our Business and Industry — We could be held liable for the malpractice of our medical practitioner and the negligence of our
+staff members and other agents."
+
+ 
+
+Properties
+
+ 
+
+As
+of December 31, 2024, we conduct our operations at 4 physical locations with an aggregate floor space of approximately 15,000 sq. ft.
+Three of them are service centers and the remaining is administrative and training premise. All premises are located in commercial buildings
+and are leased with the following terms:
+
+ 
+
+ 
+ Locations
+ 
+ Use
+ 
+ Lease
+ Terms
+
+ 
+ Unit
+ 15-16, 22/F., CEO Tower, 77 Wing Hong Street, Cheung Sha Wan, Kowloon
+ 
+ Office
+ 
+ August
+ 1, 2024 – July 31, 2027
+
+ 
+ Unit
+ 1701, 1712 & 1715, 17/F., Langham Place Office Tower, 8 Argyle Street, Mongkok, Kowloon
+ 
+ Shop
+ 
+ August
+ 20, 2023 – August 19, 2025
+
+ 
+ Unit
+ 3201-3, 32/F., World Trade Centre, 280 Gloucester Road, Causeway Bay, Hong Kong
+ 
+ Shop
+ 
+ July
+ 12, 2024 – July 11, 2027
+
+ 
+ Room
+ 808-809, 8/F., Kwong Wah Plaza, 11 Tai Tong Road, Yuen Long, N.T.
+ 
+ Shop
+ 
+ May
+ 30, 2023 – May 29, 2026
+
+ 
+ Office No. 6-7, 8/F, Kwong Wah Plaza, 11 Tai Tong Road, Yuen Long, New Territories
+ 
+ Shop
+ 
+ August 3, 2024 - May 29, 2026
+
+ 
+ 
+
+ 88
+
+ 
+
+ 
+
+ 
+
+Our
+Medical Practitioner
+
+ 
+
+We
+have entered into a cooperation agreement with our sole full-time medical partner and consultant, Dr. Pang Sai Yau, pursuant to which
+Dr. Pang has agreed to provide medical aesthetic services to our customers (including but not limited to the injection of Botox and Restylane,
+conducting energy-based procedures and the prescription of medicines), while the Company provides management and administrative support.
+Dr. Pang is named as a pioneer in the medical aesthetic service industry in Hong Kong. We believe our cooperation with Dr. Pang allows
+us to remain competitive in the industry.
+
+ 
+
+Dr.
+Pang is a registered medical practitioner in Hong Kong. He completed the Master of Philosophy from medical school of the Chinese University
+of Hong Kong and the Postgraduate Diploma in Practical Dermatology from the University of Wales, College of Medicine. He has been elected
+as the member of Royal College of Physician of the United Kingdom and admitted as a Fellow of the Faculty of Medicine of Australasian
+College of Cosmetic Surgery. He is also one of the founders of Association of Doctors in Aesthetic Medicine (Hong Kong). Dr. Pang has
+used the address of our service center in Mongkok, Causeway Bay and Yuen Long as his registered address with the Medical Council of Hong
+Kong.
+
+ 
+
+From time to time, Dr.
+Pang attends industry conferences, seminars and workshops to stay current with the industry trends in cosmetology technologies and procedures.
+To ensure Dr. Pang is well versed with our internal operating protocols and service standards, our management constantly holds meetings
+with Dr. Pang to discuss any matters relating to the procedures performed on the customers.
+
+ 
+
+Legal
+Proceedings
+
+ 
+
+As
+our services carry inherent health risks, the Company, its controlling persons, and any registered medical practitioner associated with
+us are inevitably exposed to potential liability arising from complaints, claims and possibly litigation brought against them by our
+customers.
+
+ 
+
+In
+the cooperation agreement between the Company and Dr. Pang Sai Yau, our sole full-time medical partner and consultant, Dr. Pang has agreed
+to indemnify us against losses resulting from any customer s complaint regarding the procedures performed by him if he is found
+negligent. Regarding to product liabilities, the medicine suppliers will indemnify us against losses resulting from any of their product.
+
+ 
+
+As
+of the date of this prospectus, none of the Company or its subsidiaries is a party to, nor to our knowledge, has been threatened with
+any legal proceeding that, in the opinion of management, is likely to have a material adverse effect on our business, financial condition
+or operations.
+
+ 
+
+Impact
+of COVID-19
+
+ 
+
+In
+March 2020, the World Health Organization recognized the COVID-19 outbreak as a global pandemic. The COVID-19 pandemic and government
+actions implemented to contain further spread of COVID-19 have severely restricted economic activity around the world. The facts pertaining
+to the pandemic and the related governmental and regulatory response is changing day-to-day in many countries. The pandemic disrupted
+logistics in global trade and reduced consumer sentiment. Our business was also adversely affected for the same reasons. Between early
+2020 and early 2023, the Hong Kong government imposed a series of social distancing and business closure orders that prohibited certain
+gatherings and shut down non-essential economic activities such as hair salons. As the demand for beauty and personal care services is
+closely correlated with the general economic conditions, changes in discretionary income, and market sentiment, our results of operations
+decreased significantly. We responded by halting operation of all our service centers to, reduce our working capital needs, focus our
+resources on serving our customers, and improve our cash position.
+
+ 
+
+ 89
+
+ 
+
+ 
+
+ 
+
+REGULATORY
+ENVIRONMENT
+
+ 
+
+This
+section sets forth a summary of the material laws and regulations that affect our business and operations in Hong Kong. Information contained
+in this section should not be construed as a comprehensive summary nor a detailed analysis of laws and regulations applicable to our
+business and operations. Because all our operations are in Hong Kong, we believe we are currently not governed by laws and regulations
+in PRC. This overview is provided as general information only and is not intended to be a substitute for professional advice. You should
+consult your own advisers regarding the implication of the laws and regulations of Hong Kong on our business and operations.
+
+ 
+
+Hong
+Kong Laws and Regulations 
+
+ 
+
+Hong
+Kong Regulations Related to Services Providers
+
+ 
+
+Our
+operations are subject to various laws, rules, regulations and policies in Hong Kong where we operate. This section sets out summaries
+of certain aspects of Hong Kong laws, rules, regulations and policies which are relevant to our Group s operation and business.
+
+ 
+
+Medical
+Registration Ordinance (Chapter 161 of the Laws of the Hong Kong)
+
+ 
+
+All
+practicing medical practitioners in Hong Kong are required to be registered with the Hong Kong Medical Council. Section 20A(1) of the
+Medical Registration Ordinance (Chapter 161 of the Laws of the Hong Kong), as amended, supplemented or otherwise modified from time to
+time, or the MRO, provides that a registered medical practitioner shall not practice medicine, surgery or midwifery in Hong Kong, or
+any branch of medicine or surgery in Hong Kong, unless he is the holder of a practicing certificate which is then in force.
+
+ 
+
+To
+register with the Hong Kong Medical Council, a medical practitioner should, subject to certain exceptions, inter alia:
+
+ 
+
+ have
+ been awarded a degree of medicine and surgery by the University of Hong Kong or the Chinese
+ University of Hong Kong or passed the licensing examination conducted by the Hong Kong Medical
+ Council;
+
+ 
+
+ have
+ attained a certificate of experience of employment in a resident medical capacity in approved
+ hospitals for a certain prescribed period;
+
+ 
+
+ not
+ have been convicted of any criminal offence punishable with imprisonment;
+
+ 
+
+ not
+ have been found guilty of professional misconduct; and
+
+ 
+
+ be
+ of good character.
+
+ 
+
+Medical
+practitioners registered with the Hong Kong Medical Council are included in the General Register (as defined in the MRO) kept by the
+Hong Kong Medical Council.
+
+ 
+
+ 90
+
+ 
+
+ 
+
+ 
+
+Medical
+practitioners registered with the Hong Kong Medical Council will generally be issued with a practicing certificate which will be valid
+for one year. Registered medical practitioners are required to renew their practicing certificates each year which shall be in force
+for a period of 12 months commencing on 1 January in that following year and the practicing certificate for each year shall be obtained
+before 30 June of that year, failing which their names may be subject to removal from the register maintained by the Hong Kong Medical
+Council.
+
+ 
+
+We
+have partnered with a registered medical practitioner named in the General Register qualified to practice medicine, surgery and midwifery
+in Hong Kong pursuant to the practicing certificate issued to him under the MRO and is therefore subject to the regulation of the MRO.
+
+ 
+
+Under
+section 28 of the MRO, subject to certain exceptions, the practice of medicine or surgery in Hong Kong must be carried out by a registered
+medical practitioner. The carrying out of consultation services that involve the practice of medicine, medical diagnosis, prescription
+of pharmaceutical products and medicines (each as defined under the Pharmacy and Poisons Ordinance (defined below)) and certain types
+of treatments (such as injection of botulinum toxin type A and dermal filler and chemical peel) at our service centers constitute the
+practice of medicine and therefore must be carried out by our registered medical practitioner. As confirmed by our directors, the Group
+has fully complied with such requirements until the date of this prospectus.
+
+ 
+
+Hong
+Kong Medical Code of Professional Conduct
+
+ 
+
+Our
+registered medical practitioner has to comply with the Hong Kong Medical Code of Professional Conduct issued by the Hong Kong Medical
+Council (as may be amended from time to time) which covers, inter alia, the following aspects:
+
+ 
+
+(i)a
+ registered medical practitioners professional responsibilities to patients such as
+ their confidentiality obligations as well as the obligations to act in the interest of patients
+ and, whenever an examination or treatment is beyond his capacity, to consult with or refer
+ to another registered medical practitioner who has the necessary ability;
+
+ 
+
+(ii)communication
+ in registered medical practitioners professional practice, including restriction on
+ practice promotion from being carried out by registered medical practitioners;
+
+ 
+
+(iii)requirements
+ in relation to prescription and labelling of medicine/drugs to be dispensed;
+
+ 
+
+(iv)regulations
+ in respect of the relationship between registered medical practitioners and other practitioners
+ and/or organizations;
+
+ 
+
+(v)criminal
+ conviction and disciplinary proceedings of registered medical practitioners;
+
+ 
+
+(vi)registered
+ medical practitioners financial arrangements;
+
+ 
+
+(vii)regulations
+ in relation to new medical procedures, clinical research and alternative medicine;
+
+ 
+
+(viii)regulations
+ against abuse of professional position; and
+
+ 
+
+(ix)regulations
+ governing serious infectious disease and other special areas.
+
+ 
+
+Contravention
+of the Hong Kong Medical Code of Professional Conduct may render a Hong Kong registered medical practitioner liable to disciplinary action.
+
+ 
+
+Medical
+Clinics Ordinance (Chapter 343 of the Laws of Hong Kong))
+
+ 
+
+The
+Medical Clinics Ordinance (Chapter 343 of the Laws of the Hong Kong), as amended, supplemented or otherwise modified from time to time,
+or the MCO, provides for the registration, control and inspection of medical clinics.
+
+ 
+
+A
+"clinic" is defined under the MCO to mean any premises used or intended to be used for the medical diagnosis or treatment
+of persons suffering from, or believed to be suffering from, any disease, injury or disability of mind or body. However, among others,
+private consulting rooms used exclusively by registered medical practitioners in the course of their practice on their own account and
+not bearing any title or description which includes the word , ' ': , ' ': clinic or , ' ': , ' ': polyclinic 
+in the English language is not a clinic for the purpose of the MCO.
+
+ 
+
+ 91
+
+ 
+
+ 
+
+ 
+
+The
+MCO requires a medical clinic to be registered, with name and address and other prescribed particulars.
+
+ 
+
+Pursuant
+to section 14(1) of the MCO, any person who carries on or takes part in the management of a clinic which is not registered, or who therein
+does any medical diagnosis or prescribes any medical treatment or takes part in any medical treatment of any person commits an offence
+and is liable (i) on summary conviction to a fine of HK$50,000 and to imprisonment for two years; or (ii) on conviction upon indictment
+to imprisonment for three years.
+
+ 
+
+Pursuant
+to section 14(1A) of the MCO, any person who in a clinic which is not registered does any medical diagnosis, prescribes any medical treatment
+or performs any medical treatment in relation to a person which results in personal injury to that person commits an offence and is liable
+(i) on summary conviction to a fine of HK$100,000 and to imprisonment for three years; or (ii) on conviction upon indictment to imprisonment
+for seven years.
+
+ 
+
+According
+to section 5 of the MCO, an application of registration may be refused if:
+
+ 
+
+(i)the
+ income derived or to be derived from the establishment or operation of the clinic is not,
+ or will not be, applied solely towards the promotion of the objects of the clinic; or
+
+ 
+
+(ii)any
+ portion of such income, except payment of remuneration to employed registered medical practitioners,
+ nurses and menial servants, will be paid by way of dividend, bonus or otherwise howsoever
+ by way of profit to the applicant himself, or to any persons properly so employed, or to
+ any other persons howsoever.
+
+ 
+
+Furthermore,
+in the application form to be filled for the first registration of a clinic under the MCO, an applicant is required to make a declaration
+("Non-Profit Making Declaration") that the income derived from the operation of the clinic will be applied solely towards
+the promotion of the objects of the clinic and any portion of such income, except payment in good faith of remuneration to certain employees,
+will not be paid by way of dividend or otherwise howsoever by way of profit to the applicant or any other person howsoever.
+
+ 
+
+We
+have sought legal advice confirming that the MCO is not applicable to the business of the Group, having considered, among other things,
+the following:
+
+ 
+
+(i)the
+ legislative intent behind the MCO was to provide for registration of non-profit making clinics;
+
+ 
+
+(ii)the
+ Food and Health Bureau of Hong Kong published a consultation document, "Regulation
+ of Private Healthcare Facilities" in December 2014 ("Consultation Paper"),
+ which specifically states that the MCO and the Code of Practice For Clinics Registered Under
+ The Medical Clinics Ordinance (Chapter 343 of the Laws of Hong Kong) set out the regulatory
+ framework for non-profit-making medical clinics and that other private healthcare facilities,
+ such as ambulatory medical centers and clinics operated by medical groups or individual medical
+ practitioners, were then not subject to direct statutory control beyond the regulation of
+ an individual s professional practice. It was also commented in the Consultation Paper
+ that the MCO was outdated and had outlived its usefulness and the Working Group and Steering
+ Committee (both as defined in Recent Development in relation to Regulation of Medical Procedures
+ and Beauty Services in this section) were fully aware of the existence of incorporated companies
+ set up by non-medical investors, operated by non-medical managers and providing services
+ by registered medical practitioners, while at the time, there was no regulatory framework
+ under the MCO or otherwise to govern activities of such companies;
+
+ 
+
+ 92
+
+ 
+
+ 
+
+ 
+
+(iii)our
+ business is one which makes and intends to continue making profit as a listed entity. The
+ payment of bonuses and dividends clearly reflects the profit-making nature of our business;
+ and
+
+ 
+
+(iv)an
+ application for registration may be refused pursuant to section 5 of the MCO mentioned above
+ as we have been remunerating and will continue to remunerate our registered medical practitioner
+ by way of bonus and may distribute our profit by way of dividends or other forms of distributions
+ before and after the Offering. Further, it will be impossible for us to make the Non-Profit
+ Making Declaration required for an application for registration under the MCO.
+
+ 
+
+Hence,
+our service centers in Hong Kong are not qualified or required to be registered under the MCO.
+
+ 
+
+Private
+Healthcare Facilities Ordinance (Chapter 633 of the Laws of Hong Kong)
+
+ 
+
+The
+Private Healthcare Facilities Ordinance (Chapter 633 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time
+to time, or the PHFO, was passed on 15 November 2018 providing for the regulation of private healthcare facilities.
+
+ 
+
+A
+private healthcare facility is defined under section 3 of the PHFO as a hospital, day procedure center, clinic or health services establishment,
+other than a day procedure center, clinic or health services establishment primarily used for teaching or research relating to medicine
+or dentistry that is managed or controlled by a university.
+
+ 
+
+Pursuant
+to section 4 of the PHFO, a hospital is any premises that is used, or intended to be used, for (a) providing medical services to patients,
+with lodging; (b) carrying out medical procedures on patients, with lodging; or (c) receiving a pregnant woman for childbirth; or a woman
+immediately after she gives birth to a child.
+
+ 
+
+Pursuant
+to section 5 of the PHFO, a day procedure center is any premises that (a) that does not form part of the premises of a hospital; and
+(b) that is used, or intended to be used, for carrying out scheduled medical procedures on patients, without lodging, whether or not
+the premises is also used, or intended to be used, for (i) providing medical services to patients, without lodging; or (ii) carrying
+out minor medical procedures on patients, without lodging.
+
+ 
+
+Pursuant
+to section 6 of the PHFO, a clinic is any premises that (a) that does not form part of the premises of a hospital, a day procedure center
+or an outreach facility; and (b) that is used, or intended to be used, for (i) providing medical services to patients, without lodging;
+or (ii) carrying out minor medical procedures on patients, without lodging.
+
+ 
+
+Pursuant
+to section 7 of the PHFO, a health services establishment is any premises that is of an education or scientific (or both) research institution
+in which medical services with lodging are provided to patients for the purpose of conducting clinical trials, but does not form part
+of the premises of a hospital, a day procedure centre or a clinic; and is used, or intended to be used, in relation to (i) assessing,
+maintaining or improving the health of patients; or (ii) diagnosing or treating illnesses or disabilities, or suspected illnesses or
+disabilities, of patients.
+
+ 
+
+According
+to section 2 of the PHFO, scheduled medical procedure means a medical procedure that is listed in Column 2 of Schedule 3 of the PHFO,
+but does not fall under Column 3 of Schedule 3, and is carried out in an ambulatory setting. 8 classes of specialized services are listed
+in Column 1 of Schedule 3, namely surgical procedure, endoscopic procedure, dental procedure, chemotherapy, haemodialysis, inter-ventional
+radiology and lithotripsy, anesthetic procedure and radiotherapy. Each class of specialized services has a list of particular medical
+procedures listed in Column 2 and a list of exempted procedures listed in Column 3. Schedule 3 may be amended by the Secretary for Health
+by a notice published in the Gazette.
+
+ 
+
+ 93
+
+ 
+
+ 
+
+ 
+
+According
+to section 2 of the PHFO medical service means medical diagnosis, treatment or care for the patient given by a registered medical practitioner
+or a registered dentist.
+
+ 
+
+According
+to section 2 of the PHFO, minor medical procedure means medical procedure that that is not a scheduled medical procedure; and that is
+carried out in an ambulatory setting.
+
+ 
+
+Section
+10(1) of the PHFO provides that a person must not operate a private healthcare facility without a license. This subsection came into
+operation on 1 January 2021 in so far as it relates to hospitals, and on 30 June 2022 in so far as it relates to a day procedure center.
+Any person who operates a private healthcare facility without a license commits an offence liable to a fine and a term of imprisonment.
+
+ 
+
+The
+licensing regime in respect of clinics has yet to come into operation. To the best of our knowledge, the Hong Kong government has yet
+to announce the implementation timetable and application procedure and arrangement for the licensing regime in respect of clinics.
+
+ 
+
+We
+confirm that our service centers do not provide lodging services to our customers, and are not hospitals as defined under the PHFO.
+
+ 
+
+The
+Beauty Services performed in our service centers do not fall into any of the procedures listed in Column 2 of Schedule 3, and/or they
+fall under the exempted procedures listed in Column 3 of Schedule 3.
+
+ 
+
+Hence,
+subject to further announcements by the Hong Kong government as to the further implementation of the PHFO, our service centers are not
+qualified or required to be licensed under the PHFO at present.
+
+ 
+
+Upon the future
+implementation of the licensing regime in respect of clinics, our service centers may have to apply for a license, and comply with the
+laws and regulations regulating the operation of clinics including provisions under the PHFO, license conditions, code of practices and
+directions issued by the Director of Health.
+
+ 
+
+The relevant provisions
+regulating the operation of clinics include but not limited to the followings: the licensee must appoint a chief medical executive (who
+must be a registered medical practitioner registered for not less than 4 years in Hong Kong) to take charge of the day to day administration
+of the facility; the licensee must put in place a complaints handling procedure for receiving, managing and responding to complaints
+received against the clinic; the premises of the facility have to be physically separated from any premises that serve a purpose not
+reasonably incidental to the type of facility for which the license is issued; the facility has to have a direct and separate entrance
+not shared with, or involving passing through any premises that serve a purpose not reasonably incidental to the type of facility for
+which the license is issued.
+
+ 
+
+Further, complaints
+against the clinic may be made to the Committee on Complaints against Private Healthcare Facilities established under the PHFO. The Complaints
+Committee shall process the complaints and may refer the facility to the Director of Health for appropriate regulatory actions if the
+complaint is substantiated.
+
+ 
+
+Regulations
+on Pharmaceutical Products and Drugs in Hong Kong
+
+ 
+
+Pharmacy
+and Poisons Ordinance (Chapter 138 of the Laws of Hong Kong) and the Pharmacy and Poisons Regulations (Chapter 138A of the Laws of Hong
+Kong)
+
+ 
+
+The
+Pharmacy and Poisons Ordinance (Chapter 138 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to time,
+or the PPO, regulates the sale and labelling of products which are classified as pharmaceutical products and medicine.
+
+ 
+
+Section
+2 of the PPO defines "pharmaceutical products" and "medicine" to mean a substance or combination of substances
+that:
+
+ 
+
+ presented
+ as having properties for treating or preventing disease in human beings or animals; or
+
+ that
+ may be used in, or administered to, human beings or animals, either with a view to
+
+ 
+
+(i)
+restoring, correcting or modifying physiological functions by exerting a pharmacological, immunological or metabolic action, or
+
+(ii)
+making a medical diagnosis.
+
+ 
+
+Regulation
+36(1) of the Pharmacy and Poisons Regulations (Chapter 138A of the Laws of Hong Kong), as amended, supplemented or otherwise modified
+from time to time, or the PPR, provides that pharmaceutical products must be registered before they can be sold, offered for sale, distributed
+or possessed for the purposes of sales, distribution or other use in Hong Kong.
+
+ 
+
+Ingredients
+that are classified as poisons are listed in the Poisons List under Schedule 10 of the PPR. According to their potency, toxicity and
+potential side effects, some poisons are further categorized under different parts of the Poisons List and different schedules under
+the PPR. The levels of control over the sale of poisons depend on their categorization.
+
+ 
+
+ Pharmaceutical
+ products that do not contain any poisons can be sold in any retail shops.
+
+ Pharmaceutical
+ products containing poisons as set out in Part 2 of Schedule 10 can only be sold by authorized
+ sellers of poisons (usually known as pharmacies or dispensaries) and listed sellers of poisons
+ (usually known as medicine stores).
+
+ Pharmaceutical
+ products containing poisons as set out in Part 1 of Schedule 10 can only be sold by authorized
+ sellers of poisons by a registered pharmacist or in his presence and under his supervision.
+
+ 
+
+ 94
+
+ 
+
+ 
+
+ 
+
+However,
+the supply of medicine by a registered medical practitioner for the purposes of medical treatment is not subject to such limitations
+in relation to the sale of Part 1 and Part 2 poisons.
+
+ 
+
+Some
+Part 1 Poisons as set out in Schedule 10 are further set out in the Schedule 1 and the Schedule 3 of the PPR with additional restrictions
+on their sale.
+
+ 
+
+Any
+poison included in Schedule 3 can only be sold on and in accordance with a prescription given by a registered medical practitioner, registered
+dentist or registered veterinary surgeon. The sale of pharmaceutical products containing the poisons included in the Schedule 1 requires
+keeping sale records which include, inter alia, the name and quantity of the poison supplied, the date on which the poison was
+supplied, the name and address of the person to whom the poison was supplied, and the name of the person who supplied the poison or gave
+the prescription upon which it was supplied.
+
+ 
+
+In
+order to be exempted from the conditions and limitations mentioned above, all ordering and dispensing of medication and substances which
+may include Part I and Part II poisons at our service centers are carried out by or conducted under the supervision of our registered
+medical practitioner. Medicines are dispensed to our customers with full records being kept.
+
+ 
+
+On
+the other hand, to the best of our directors knowledge after due care and making of reasonable enquiries, private-label products
+under our brands and other branded products supplied at our service centers do not contain any medication or poisons and are therefore
+not regulated and not required to be registered under the PPO or the PPR.
+
+ 
+
+Dangerous
+Drugs Ordinance (Chapter 134 of the Laws of Hong Kong) and the Dangerous Drugs Regulations (Chapter 134A of the Laws of Hong Kong)
+
+ 
+
+The
+Dangerous Drugs Ordinance (Chapter 134 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to time, or
+the DDO, regulates the import, export, procuring, supply, dealing in or with, manufacture and possession of drugs or substances which
+are classified as dangerous drugs under Part I of the First Schedule of the DDO.
+
+ 
+
+Dangerous
+drugs are not allowed to be supplied to any person except to a person authorized or licensed to be in possession of such drugs in accordance
+with the DDO. However, the administration of a dangerous drug by or under the direct personal supervision of, and in the presence of,
+a registered medical practitioner is exempted.
+
+ 
+
+A
+registered medical practitioner is also authorized by the DDO, so far as may be necessary for the practice or exercise of his profession
+and in his capacity as such, to be in possession of and to supply a dangerous drug as well as to have in his possession equipment or
+apparatus fit and intended for the injection of a dangerous drug.
+
+ 
+
+Furthermore,
+the Dangerous Drugs Regulations (Chapter 134A of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to
+time, or the DDR, regulates the prescriptions, labelling and record keeping of dangerous drugs and monitors the sale of such drugs.
+
+ 
+
+As
+mentioned above, all the ordering and dispensing of medications at our service centers are carried out by or conducted under the supervision
+of our registered medical practitioner.
+
+ 
+
+Moreover,
+as confirmed by our registered medical practitioner, neither of our service centers keep any dangerous drugs regulated under the DDO.
+
+ 
+
+ 95
+
+ 
+
+ 
+
+ 
+
+Regulations
+on the Supply of Goods and Services in Hong Kong
+
+ 
+
+Trade
+Descriptions Ordinance (Chapter 362 of the Laws of Hong Kong)
+
+ 
+
+The
+Trade Descriptions Ordinance (Chapter 362 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to time,
+or the TDO prohibits false trade descriptions, false, misleading or incomplete information, false marks and misstatements in respect
+of goods provided in the course of trade or suppliers of such goods; and false trade descriptions in respect of services supplied by
+traders.
+
+ 
+
+The
+TDO also confers power to require information or instruction relating to goods to be marked on or to accompany the goods or to be included
+in advertisements; restates the law relating to forgery of trademarks; prohibits certain unfair trade practices; confers power to require
+any services to be accompanied by information or instruction relating to the services or an advertisement of any services to contain
+or refer to information relating to the services; and for purposes connected therewith.
+
+ 
+
+Definition
+of "trader"
+
+ 
+
+"Trader"
+means any person (other than an exempt person under Schedule 3) who, in relation to a commercial practice, is acting, or purporting to
+act, for purposes relating to the person s trade or business.
+
+ 
+
+A
+registered medical practitioner as defined under the MRO is an exempt person under Schedule 3. Medical services provided by our registered
+medical practitioner is exempted from the regulations applicable to traders under the TDO.
+
+ 
+
+However,
+the Group is still subject to the following regulations under the TDO as we also provide skin care products and services to customers
+at our service centers.
+
+ 
+
+Definition
+of "false trade description"
+
+ 
+
+A
+false trade description means:
+
+ 
+
+ a
+ trade description which is false to a material degree; or
+
+ 
+
+ a
+ trade description which, though not false, is misleading, that is to say, likely to be taken
+ for a trade description of a kind that would be false to a material degree.
+
+ 
+
+False
+trade description of goods
+
+ 
+
+Any
+person who in the course of any trade or business applies a false description to any goods, or supplies any goods to which a false trade
+description is applied, or has in his possession for sale or for any purpose of trade or manufacture any goods to which a false trade
+description is applied, commits an offence.
+
+ 
+
+In
+relation to goods, "trade description" means an indication, direct or indirect, and by whatever means given, with respect
+to the goods or any part of the goods including an indication of any of the following matters:
+
+ 
+
+(i)quantity
+ (which includes length, width, height, area, volume, capacity, weight and number), size or
+ gauge;
+
+ 
+
+(ii)method
+ of manufacture, production, processing or reconditioning;
+
+ 
+
+(iii)composition;
+
+ 
+
+(iv)fitness
+ for purpose, strength, performance, behavior or accuracy;
+
+ 
+
+(v)availability;
+
+ 
+
+(vi)compliance
+ with a standard specified or recognized by any person;
+
+ 
+
+(vii)price,
+ how price is calculated or the existence of any price advantage or discount;
+
+ 
+
+ 96
+
+ 
+
+ 
+
+ 
+
+(viii)liability
+ to pay duty on them under the laws of Hong Kong, generally or in specified circumstances;
+
+ 
+
+(ix)testing
+ by any person and results thereof;
+
+ 
+
+(x)approval
+ by any person or conformity with a type approved by any person;
+
+ 
+
+(xi)a
+ person by whom they have been acquired, or who has agreed to acquire them;
+
+ 
+
+(xii)their
+ being of the same kind as goods supplied to a person;
+
+ 
+
+(xiii)place
+ or date of manufacture, production, processing or reconditioning;
+
+ 
+
+(xiv)person
+ by whom manufactured, produced, processed or reconditioned;
+
+ 
+
+(xv)other
+ history, including previous ownership or use;
+
+ 
+
+(xvi)availability
+ in a particular place of (a) a service for the inspection, repair or maintenance of the goods;
+ or (b) spare parts for the goods;
+
+ 
+
+(xvii)warranty
+ given in respect of the service or spare parts referred to in item (xvi) above;
+
+ 
+
+(xviii)the
+ person by whom the service or spare parts referred to in item (xvi) above are provided;
+
+ 
+
+(xix)the
+ scope of the service referred to in item (xvi)(a) above;
+
+ 
+
+(xx)the
+ period for which (and the price at which) the service or spare parts referred to in item
+ (xvi) above are available; and
+
+ 
+
+(xxi)the
+ charge or cost at which the service or spare parts referred to in item (xvi) above are available.
+
+ 
+
+False
+trade description of services
+
+ 
+
+A
+trader who applies a false trade description to a service supplied or offered to be supplied to a consumer or who supplies or offers
+to supply to a consumer a service to which a false trade description is applied, commits an offence.
+
+ 
+
+In
+relation to a service, "trade description" means an indication, direct or indirect, and by whatever means given, with respect
+to the service or any part of the service including an indication of any of the following matters:
+
+ 
+
+(i)nature,
+ scope, quantity (including the number of occasions on which, and the length of time for which,
+ the service is supplied or to be supplied), standard, quality, value or grade;
+
+ 
+
+(ii)fitness
+ for purpose, strength, performance, effectiveness, benefits or risks;
+
+ 
+
+(iii)method
+ and procedure by which, manner in which, and location at which, the service is supplied or
+ to be supplied;
+
+ 
+
+(iv)availability;
+
+ 
+
+(v)testing
+ by any person and the results of the testing;
+
+ 
+
+(vi)approval
+ by any person or conformity with a type approved by any person;
+
+ 
+
+(vii)a
+ person by whom it has been acquired, or who has agreed to acquire it;
+
+ 
+
+ 97
+
+ 
+
+ 
+
+ 
+
+(viii)the
+ person by whom the service is supplied or to be supplied;
+
+ 
+
+(ix)after-sale
+ service assistance concerning the service; and
+
+ 
+
+(x)price,
+ how price is calculated or the existence of any price advantage or discount.
+
+ 
+
+Unfair
+trade practices
+
+ 
+
+Further,
+the TDO prohibits certain specified trade practices:
+
+ 
+
+Misleading
+omissions
+
+ 
+
+A
+trader who engages in a commercial practice that is a misleading omission commits an offence. A commercial practice is a misleading omission
+if it omits or hides material information, or provides material information in a manner that is unclear, unintelligible, ambiguous or
+untimely, or fails to identify its commercial intent (unless this is already apparent from the context), and as a result it causes or
+is likely to cause an average consumer to make a transactional decision that the consumer would not have made otherwise.
+
+ 
+
+Aggressive
+commercial practices
+
+ 
+
+A
+trader who engages in a commercial practice that is aggressive commits an offence. A commercial practice is aggressive it (a) significantly
+impairs or is likely to significantly impair the consumer s freedom of choice or conduct in relation to the product concerned through
+the use of harassment, coercion or undue influence and (b) therefore causes or is likely to cause the consumer to make a transactional
+decision that the consumer would not have made otherwise.
+
+ 
+
+Bait
+advertising
+
+ 
+
+A
+trader who engages in a commercial practice that constitutes bait advertising commits an offence. Advertising products for supply at
+a specified price is bait advertising if there are no reasonable grounds for believing that the trader will be able to offer for supply
+those products at that price, or the trader fails to offer those products for supply at that price, for a period that is, and in quantities
+that are, reasonable.
+
+ 
+
+However,
+advertising by a trader of products for supply at a specified price is not bait advertising if the advertisement states clearly the period
+for which, or the quantities in which, the products are offered for supply at that price; and the trader offers those products for supply
+at that price for that period or in those quantities.
+
+ 
+
+Bait
+and switch
+
+ 
+
+A
+trader who engages in a commercial practice that constitutes a bait and switch commits an offence. The making by a trader of an invitation
+to purchase a product at a specified price is a bait and switch if having made the invitation, the trader then with the intention of
+promoting a different product (a) refuses to show or demonstrate the product to consumers, or (b) refuses to take orders for the product
+or deliver it within a reasonable time, or (c) shows or demonstrates a defective sample of the product.
+
+ 
+
+Wrongly
+accepting payment
+
+ 
+
+A
+trader engages in a commercial practice that constitutes wrongly accepting payment for a product commits an offence. A trader wrongly
+accepts payment for a product if he accepts payment or other consideration for the product and at the time of that acceptance, (a) the
+trader intends not to supply the product, or (b) the trader intends to supply a product that is materially different from the product
+in respect of which the payment or other consideration is accepted, or (c) there are no reasonable grounds for believing that the trader
+will be able to supply the product (i) within the period specified by the trader at or before the time at which the payment or other
+consideration is accepted, or (ii) if no period is specified at or before that time, within a reasonable period.
+
+ 
+
+ 98
+
+ 
+
+ 
+
+ 
+
+Consumer
+Goods Safety Ordinance (Chapter 456 of the Laws of Hong Kong)
+
+ 
+
+The
+Consumer Goods Safety Ordinance (Chapter 456 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to time,
+or the CGSO, imposes a statutory duty on manufacturers, importers and suppliers to ensure that the consumer goods supplied are safe.
+
+ 
+
+Section
+6 of the CGSO provides that a person shall not supply, manufacture or import into Hong Kong consumer goods unless the consumer goods
+comply with (i) the general safety requirement for consumer goods; or (ii) (where a standard has been approved by the Secretary for Commerce
+and Economic Development to apply to consumer goods), the approved standard for the particular consumer goods. Any person who contravenes
+section 6 commits an offence.
+
+ 
+
+The
+general safety requirement for consumer goods means that the consumer goods are reasonably safe having regard to all of the circumstances.
+Where an approved standard applies to consumer goods, the consumer goods shall be taken as complying with the general safety requirement
+if they comply with the approved standard.
+
+ 
+
+Certain
+defenses are available under the CGSO. One of the defenses is that the relevant person supplied the consumer goods in the course of carrying
+on a retail business and at the time he supplied the consumer goods, he neither knew nor had reasonable grounds for believing that the
+consumer goods failed to comply with the general safety requirement.
+
+ 
+
+The
+Consumer Goods Safety Regulation (Chapter 456A of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to
+time, or the CGSR, requires that any warning or caution with respect to the safe keeping, use, consumption or disposal of any consumer
+goods must be given in both Chinese and English. Further, the warning or caution must be legible and placed in a conspicuous position
+on the consumer goods, any package of the consumer goods, or on a label securely affixed to the package, or a document enclosed in the
+package.
+
+ 
+
+Consumer
+goods are goods which are ordinarily supplied for private use or consumption. Pharmaceutical products and poisons are not consumer goods
+pursuant to the Schedule of the CGSO.
+
+ 
+
+Skin
+care products sold and/or supplied at our service centers in Hong Kong which are not pharmaceutical products are subject to the CGSO
+and the CGSR.
+
+ 
+
+Sale
+of Goods Ordinance (Chapter 26 of the Laws of Hong Kong)
+
+ 
+
+Contracts
+for the sale of goods in Hong Kong are mainly governed by the Sale of Goods Ordinance (Chapter 26 of the Laws of Hong Kong), as amended,
+supplemented or otherwise modified from time to time. For consumer transactions, certain terms are implied into sales contracts to strengthen
+protection to consumers.
+
+ 
+
+Examples
+include the implied undertaking that the goods are of merchantable quality, requiring that the goods should be fit for the purpose(s)
+for which goods of that kind are commonly bought, of such standard of appearance and finish, free from defects (including minor defects),
+safe, and durable as reasonably expected having regard to the relevant circumstances.
+
+ 
+
+Supply
+of Services (Implied Terms) Ordinance (Chapter 457 of the Laws of Hong Kong)
+
+ 
+
+There
+are also implied terms prescribed in respect of the supply of services under the Supply of Services (Implied Terms) Ordinance (Chapter
+457 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to time. An example of the implied terms is that
+the service supplier will carry out the service with reasonable care and skill.
+
+ 
+
+Tortious
+duty of retailers
+
+ 
+
+Apart
+from their liability under the contract, retailers in Hong Kong may also owe a duty of care to consumers and liable for damages resulting
+from defects in the goods caused by their negligent acts or for any fraudulent misrepresentation made in the selling of the goods. Liability
+may arise if a retailer disregards the instructions of the manufacturers or suppliers in handling the relevant goods or fails to pass
+on to the buyers instructions for use and warnings received from such manufacturers or suppliers. If a retailer knows or reasonably
+believes that the goods may be defective or dangerous, it may have to cease to supply such goods and take basic precautions such as warning
+the buyers and informing the relevant manufacturers or suppliers.
+
+ 
+
+ 99
+
+ 
+
+ 
+
+ 
+
+Unconscionable
+Contracts Ordinance (Chapter 458 of the Laws of Hong Kong)
+
+ 
+
+The
+Unconscionable Contracts Ordinance (Chapter 458 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to
+time empowers the court, with respect to a contract for the sale of goods or supply of services in which one of the parties deals as
+a consumer that was unconscionable at the time it was made, to refuse to enforce the contract, enforce the remainder of the contract
+without the unconscionable part, or limit the application of, revise or alter any part which is found to be unconscionable so as to avoid
+any unconscionable result.
+
+ 
+
+Control
+of Exemption Clauses Ordinance (Chapter 71 of the Laws of Hong Kong)
+
+ 
+
+The
+Control of Exemption Clauses Ordinance (Chapter 71 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time
+to time, or the CECO, limits the extent to which civil liability for breach of contract, or for negligence or other breach of duty, can
+be avoided by means of contract terms and otherwise.
+
+ 
+
+Some
+restrictions imposed by the CECO include under section 7, a person cannot by reference to any contract term or notice exclude or restrict
+his liability for death or personal injury resulting from negligence. Any exclusion or restriction of liability for negligence for loss
+or damage to property is valid only in so far as such a clause satisfy the requirement of reasonableness.
+
+ 
+
+Section
+8 of the CECO provides that a party dealing with a consumer cannot by reference to any contract term exclude or restrict any liability
+when he is in breach of the contract, or claim to be entitled to render a contractual performance substantially different from what is
+reasonably expected of him or render no performance of his contractual obligation at all, unless the contractual term satisfies the requirement
+of reasonableness.
+
+ 
+
+Competition
+Ordinance (Chapter 619 of the Laws of Hong Kong) 
+
+ 
+
+The
+Competition Ordinance (Chapter 619 of the Laws of Hong Kong), as amended, supplemented or otherwise
+modified from time to time, or the Competition Ordinance, prohibits and deters
+undertakings in all sectors from adopting anti-competitive conducts which has the object or effect of preventing, restricting or distorting
+competition in Hong Kong. It provides for general prohibitions in three major areas of anti-competitive conduct described as the first
+conduct rule, the second conduct rule and the merger rule.
+
+ 
+
+The
+first conduct rule prohibits undertakings from making or giving effect to agreements or decisions or engaging in concerted practices
+that have as their object or effect the prevention, restriction or distortion of competition in Hong Kong.
+
+ 
+
+The
+second conduct rule prohibits undertakings that have a substantial degree of market power in a market from engaging in conduct that has
+as its object or effect the prevention, restriction or distortion of competition in Hong Kong.
+
+ 
+
+The
+merger rule prohibits mergers that have or are likely to have the effect of substantially lessening competition in Hong Kong. Currently
+the application of the rule is limited to mergers relating to undertakings holding carrier licenses issued under the Telecommunications
+Ordinance (Chapter 106 of the Laws of Hong Kong).
+
+ 
+
+Pursuant
+to Section 82 of the Competition Ordinance, if the Competition Commission has reasonable cause to believe that (a) a contravention of
+the first conduct rule has occurred; and (b) the contravention does not involve serious anti-competitive conduct, it must, before bringing
+proceedings in the Competition Tribunal against the undertaking whose conduct is alleged to constitute the contravention, issue a notice
+(a "warning notice") to the undertaking.
+
+ 
+
+ 100
+
+ 
+
+ 
+
+ 
+
+Under
+Section 67 of the Competition Ordinance, where the Competition Commission has reasonable cause to believe that a contravention of the
+first conduct rule has occurred and the contravention involves serious anti-competitive conduct or a contravention of the second conduct
+rule has occurred, the Competition Commission may, instead of bringing proceedings in the Tribunal in the first instance, issue a notice
+(an "infringement notice") to the person against whom it proposes to bring proceedings, offering not to bring those proceedings
+on condition that the person makes a commitment to comply with requirements of the infringement notice.
+
+ 
+
+"Serious
+anti-competitive conduct" means any conduct that consists of any of (a) fixing, maintaining, increasing or controlling the price
+for the supply of goods or services; (b) allocating sales, territories, customers or markets for the production or supply of goods or
+services; (c) fixing, maintaining, controlling, preventing, limiting or eliminating the production or supply of goods or services; (d)
+bid-rigging.
+
+ 
+
+In
+the event of breach of the Competition Ordinance, the Competition Tribunal may make orders including: imposing a pecuniary penalty if
+satisfied that an entity has contravened a competition rule; disqualifying a person from acting as a director of a company or taking
+part in the management of a company; prohibiting an entity from making or giving effect to an agreement; modifying or terminating an
+agreement; and requiring the payment of damages to a person who has suffered loss or damage.
+
+ 
+
+Our
+directors are of the view that only the first conduct rule and the second conduct rule of the Competition Ordinance may apply on our
+Group, the merger rule of the Competition Ordinance does not.
+
+ 
+
+As
+of the date of this prospectus, our Group had not adopted any anti-competitive conduct described in the Competition Ordinance.
+
+ 
+
+Regulations
+on Advertisements in Hong Kong
+
+ 
+
+Undesirable
+Medical Advertisements Ordinance (Chapter 231 of the Laws of Hong Kong)
+
+ 
+
+The
+Undesirable Medical Advertisements Ordinance (Chapter 231 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from
+time to time, or the UMAO, aims to protect public health through prohibiting or restricting advertisements relating to certain diseases,
+consumable products and abortion.
+
+ 
+
+The UMAO defines
+"advertisement" to include any notice, poster, circular, label, wrapper or document, and any announcement made orally or
+by any means of producing or transmitting light or sound.
+
+ 
+
+Among
+other restrictions, the UMAO provides that no person shall publish, or cause to be published, any advertisement likely to lead to the
+use of any medicine, surgical appliance or treatment for:
+
+ 
+
+(a)
+the purpose of treating human beings for, or preventing human beings from contracting, any disease or condition specified in Column 1
+of Schedule 1 of the UMAO (including, among others, any disease of the skin, hair or scalp), except for a purpose specified in column
+2 of Schedule 1 (including, among others, prevention of pimples; treatment applied to an external surface of the body, of pimples, eczema,
+skill allergies, athlete s foot and fungal nail infection; treatment of hard skin and corns by the application of corn plasters
+or solvents; and relief or prevention of common minor skin conditions, including dry and chapped skin, cold sores, pruritus, insert bites,
+heat rash and napkin rash).
+
+ 
+
+ 101
+
+ 
+
+ 
+
+ 
+
+(b)
+treating human beings for any purpose specified in Schedule 2 of the UMAO (including, among others, the restoration of lost youth and
+the correction of deformity or the surgical alteration of a person s appearance).
+
+ 
+
+If
+a person named in the advertisement is held out as being the manufacturer or supplier of medicine or surgical appliances, or being able
+to provide any treatment, that person is presumed to have caused the advertisement to be published.
+
+ 
+
+Similarly,
+where any advertisement gives the name, address or telephone number of a person, and that person manufacturers or supplies medicine or
+surgical appliances, or provides any treatment, that person is presumed to have caused the advertisement to be published.
+
+ 
+
+Regulations
+on Waste Disposal 
+
+ 
+
+Waste
+Disposal Ordinance (Chapter 354 of the Laws of Hong Kong) and the Waste Disposal (Clinical Waste) (General) Regulation (Chapter 354O
+of the Laws of Hong Kong)
+
+ 
+
+The
+Waste Disposal Ordinance (Chapter 354 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to time, or
+the WDO, and the Waste Disposal (Clinical Waste) (General) Regulation (Chapter 354O of the Laws of Hong Kong), as amended, supplemented
+or otherwise modified from time to time, or the Waste Disposal (Clinical Waste) (General) Regulation, provide for, among others, the
+control and regulation of the production, storage, collection and disposal of clinical waste.
+
+ 
+
+Under
+the WDO, clinical waste means waste consisting of any substance, matter or thing generated in connection with:
+
+ 
+
+(a)
+a dental, medical, nursing or veterinary practice;
+
+(b)
+any other practice, or establishment (howsoever described), that provides medical care and services for the sick, injured, infirm or
+those who require medical treatment;
+
+(c)
+dental, medical, nursing, veterinary, pathological or pharmaceutical research; or
+
+(d)
+a dental, medical, veterinary or pathological laboratory practice,
+
+ 
+
+but
+does not include chemical waste or radioactive waste, and which consists wholly or partly of any of the materials specified in one or
+more of the groups listed below:
+
+ 
+
+ used
+ or contaminated sharps;
+
+ laboratory
+ waste;
+
+ human
+ and animal tissues;
+
+ infectious
+ materials;
+
+ dressings;
+ and
+
+ such
+ other wastes as specified by the Director of Environmental Protection.
+
+ 
+
+The
+Waste Disposal (Clinical Waste) (General) Regulation requires all waste producers to arrange for their clinical waste to be properly
+disposed of. Waste producers have complied with this duty if, among others, they consign the clinical waste to a licensed waste collector
+for delivery to a reception point, deliver the clinical waste to a reception or collection point, or consign the clinical waste to an
+authorized waste collector.
+
+ 
+
+The
+Waste Disposal (Clinical Waste) (General) Regulation also requires a waste producer to keep records in respect of clinical waste produced
+by him, and also of the consignment of clinical waste to a licensed collector or authorized waste collector, or the delivery of clinical
+waste to a reception point or collection point. The waste producer is required to produce such records for inspection upon request by
+the Director of Environmental Protection.
+
+ 
+
+Codes
+of Practice have been published by the Secretary for the Environment and Ecology under the WDO to provide guidance to major clinical
+waste producers and small clinical waste producers for complying with the legal requirements under the WDO and the Waste Disposal (Clinical
+Waste) (General) Regulation. Private medical clinics or practices, and health and beauty centers where medical practices are conducted
+are classified as small clinical waste producers under the Code of Practice.
+
+ 
+
+Given
+the medical cosmetology services provided at our services centers may produce used or contaminated sharps such as syringes and needles
+as well as dressings, our Group is subject to the WDO, Waste Disposal (Clinical Waste) (General) Regulation and the Code of Practice
+applicable to small clinical waste producers.
+
+ 
+
+ 102
+
+ 
+
+ 
+
+ 
+
+Waste
+Disposal (Chemical Waste) General Regulation (Chapter 354C of the Laws of Hong Kong)
+
+ 
+
+According
+to the Waste Disposal (Chemical Waste) General Regulation (Chapter 354C of the Laws of Hong Kong), as amended, supplemented or otherwise
+modified from time to time, or the Waste Disposal (Chemical Waste) General Regulation, an unwanted substance or by-product arising from
+the application of or in the course of any process or trade activity, and which is or contains any substance or chemical specified in
+Schedule 1 of the Waste Disposal (Chemical Waste) General Regulation shall be regarded as chemical waste if such substance or chemical
+occurs in such form, quantity or concentration so as to cause pollution or constitute a danger to health or risk of pollution to the
+environment.
+
+ 
+
+Schedule
+1 of the Waste Disposal (Chemical Waste) General Regulation includes, among other things, any substance specified in Part 1 of the Poisons
+List under the PPO, antibiotics, dangerous drugs as defined in the DDO, pharmaceutical products and medicines.
+
+ 
+
+There
+is no mention in the Waste Disposal (Chemical Waste) General Regulation as to what quantity or concentration of poisons, antibiotics,
+dangerous drugs, pharmaceutical products and medicine will amount to pollution or danger to health or risk to the environment.
+
+ 
+
+Regulation
+6 of the Waste Disposal (Chemical Waste) General Regulation provides that a person shall not produce chemical waste unless he is registered
+with the Director of Environmental Protection. A waste producer has to ensure that the chemical waste is properly packed, labelled and
+stored in accordance with the Waste Disposal (Chemical Waste) General Regulation.
+
+ 
+
+Regulation
+8 of the Waste Disposal (Chemical Waste) General Regulation provides, among others, that a waste producer shall cause or arrange chemical
+waste produced by him or in his possession or custody to be delivered to a reception point, or consign chemical waste to a waste collector,
+and also keep documents and records to show that such disposal has been complied with.
+
+ 
+
+Our
+Group has been registered with the Director of Environmental Protection as a chemical waste producer. We are also in compliance with
+the regulations on the packaging, labelling, storing and disposing of chemical waste as stipulated under the Waste Disposal (Chemical
+Waste) General Regulation, and the Code of Practice providing guidance for complying with the requirements under the said Regulation.
+
+ 
+
+Waste
+Disposal (Charging for Municipal Solid Waste) (Amendment) Ordinance 2021
+
+ 
+
+The Waste Disposal
+(Charging for Municipal Solid Waste) (Amendment) Ordinance 2021 establishing a quantity-based charging scheme for the disposal of municipal
+solid waste was passed by the Legislative Council on 26 August 2021. The Hong Kong government announced that municipal solid waste charging
+will be implemented from 1 August 2024 onwards.
+
+ 
+
+Municipal solid
+waste means any waste except chemical waste, clinical waste and construction waste.
+
+ 
+
+Under the charging
+scheme, our Group will have to wrap commercial waste properly in designated bags purchased by the Group before disposing so. The price
+for disposing municipal solid waste is HK$0.11 per liter. Violators will commit an offence liable to a fine and imprisonment.
+
+ 
+
+Regulations
+on possessing, maintaining and use of certain treatment devices 
+
+ 
+
+Telecommunications
+Ordinance (Chapter 106 of the Laws of Hong Kong)
+
+ 
+
+Under
+the Telecommunications Ordinance (Chapter 106 of the Laws of Hong Kong), for a person to possess or use any apparatus for radiocommunications
+or any apparatus of any kind that generates and emits radio waves notwithstanding that the apparatus is not intended for radiocommunications,
+the person must apply for an appropriate telecommunications license from the Communications Authority.
+
+ 
+
+Since
+we possess one Thermage CPT equipment in each of our CWB Centre and Mongkok Centre for use in providing Thermage CPT treatments, being
+a type of energy-based procedure involving the use of radiofrequency that deploys high-frequency radio waves that excite water molecules
+within the skin to generate heat, we are required to apply for and maintain an Industrial, Scientific and Medical Electronic Machine
+Licences (, ' ': , ' ': ISMEM Licence ) as prescribed by the Communications Authority, which generally has a validity of
+one year and may be renewed for a period of one year at a time. Under the respective ISMEM Licence held by CWB Centre and Mongkok Centre,
+we are licensed to possess, maintain and use the licensed Thermage CPT equipment at our CWB Centre and Mongkok Centre which address is
+specified under the relevant ISMEM Licence for the purpose of generating high frequency electro- magnetic energy which shall be used
+for industrial, scientific and medical purposes only, subject to certain conditions, which include:
+
+ 
+
+a.the
+ licensed Thermage CPT equipment shall be used only under suppressed radiation conditions.
+ Radiation outside the internationally allocated frequencies causing interference to communication
+ services shall be suppressed to the satisfaction of the Communications Authority;
+
+ 
+
+ 103
+
+ 
+
+ 
+
+ 
+
+b.the
+ licensed Thermage CPT equipment shall be operated only be persons authorised by the licensee,
+ namely, CWB Centre and Mongkok Centre, which is the holder of the relevant ISMEM Licence,
+ on their behalf;
+
+c.The
+ licensee shall not without the consent in writing of the Communications Authority (i) make
+ any alternation or addition to the apparatus (apparatuses) covered by the ISMEM Licence;
+ or (ii) change the address of the place where the apparatus (apparatuses) is maintained and
+ used;
+
+d.If
+ at any time the licensee wishes to make (i) any alteration or addition mentioned in sub-
+ paragraph (c)(i) above; or (ii) a change of address mentioned in sub- paragraph (c)(ii),
+ it shall make application in writing to the Communications Authority for consent to such
+ alteration, addition or change not less than 10 days before the date on which it intends
+ to make such alteration, addition or change; and
+
+e.the
+ ISMEM Licence is not transferable.
+
+ 
+
+It
+is our policy that in each of our service centers the licensed Thermage CPT equipment shall only be operated by our doctor.
+
+ 
+
+Radiation
+Ordinance (Chapter 303 of the Laws of Hong Kong)
+
+ 
+
+We
+possess/use radioactive substance or irradiating apparatus.
+
+ 
+
+Under
+the Radiation Ordinance, (Chapter 303 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to time ("Radiation
+Ordinance"), for a person to possess or use any radioactive substance or irradiating apparatus the person must apply for a license.
+
+ 
+
+Under
+the Radiation Ordinance, radioactive substance means any substance which consists of or contains any radioactive chemical element whether
+natural or artificial and whose specific activity exceeds 75 becquerels of parent radioactive chemical element per gram of substance.
+
+ 
+
+Irradiating
+apparatus means an apparatus which (a) is intended to produce or emit ionizing radiation; or (b) is capable of producing or emitting
+ionizing radiation at a dose rate exceeding 5 Sv per hour at a distance of 5 cm from any accessible point of the surface of the apparatus.
+
+ 
+
+Ionizing
+radiation means electromagnetic radiation (X-ray or gamma ray photons or quanta) or corpuscular radiation (alpha particles, beta particles,
+electrons, positrons, protons, neutrons or heavy particles) being electromagnetic radiation or corpuscular radiation capable of producing
+ions and emitted from a radioactive substance or from a machine that is intended to produce ionizing radiations, or from a machine in
+which electrons are accelerated by a voltage of not less than 5 kilovolts.
+
+ 
+
+The
+equipment being used in our premises are complied with this legal requirement. And we acquire equipment from suppliers with relevant
+qualifications and certificates.
+
+ 
+
+According to our Hong Kong
+counsel, O Tse & Co., we are currently complied with the above "Hong Kong Laws and Regulations". We cannot give
+any assurance of any future changes of such laws and regulations. Our operations may be adversely affected, see "Risk Factors
+– Risks Related to Our Business and Industry - Changes in the policies, regulations and rules, and the enforcement of laws of Hong
+Kong government may be implemented quickly with little advance notice and could have a significant impact upon our ability to operate
+profitably in Hong Kong. The current Hong Kong legal system also embodies uncertainties, which could limit law enforcement availability.
+Therefore, our assertions and beliefs of the risk imposed by the legal and regulatory system cannot be certain." on page 25.
+
+ 
+
+RECENT
+DEVELOPMENT IN RELATION TO REGULATION OF MEDICAL PROCEDURES AND BEAUTY SERVICES, AS WELL AS PRIVATE HEALTHCARE FACILITIES 
+
+ 
+
+In
+recent years, the Hong Kong government has been considering to tighten up the regulations of the beauty industry and to provide a clear
+definition for differentiating beauty services from medical treatments.
+
+ 
+
+Report
+of the Working Group on Differentiation between Medical Procedures and Beauty Services
+
+ 
+
+A
+Steering Committee on Review of the Regulation of Private Healthcare Facilities (the "Steering Committee") was established
+in 2012 to review the regulatory regime for private healthcare facilities.
+
+ 
+
+ 104
+
+ 
+
+ 
+
+ 
+
+A
+Working Group on Differentiation between Medical Procedures and Beauty Services (the "Working Group") had also been set up
+under the Steering Committee, which was tasked to differentiate between medical treatments and ordinary beauty services and to make recommendations
+on the regulatory approach.
+
+ 
+
+The
+Report of the Working Group on Differentiation between Medical Procedures and Beauty Services was published in 2013.
+
+ 
+
+The
+Working Group made the following recommendations (the "Recommendations") as to whether certain procedures should be performed
+by registered medical practitioners.
+
+ 
+
+1.Cosmetic
+ procedures that involve injections should be performed by registered medical practitioners.
+
+ 
+
+2.Procedures
+ that involve the mechanical/ chemical exfoliation of the skin below the epidermis should
+ be performed by registered medical practitioners.
+
+ 
+
+3.Traditional
+ body tattooing and piercing should be exempted from being considered as a "medical
+ procedure", but special care should be taken for procedures performed on body parts
+ which have higher risk of complications (e.g. near the eyes, the tongue, etc.). All practitioners
+ should be well trained and adopt infection control measures when performing the procedures.
+ Practitioners should ensure that consumers are made aware of the inherent risks involved
+ and allowed to make informed decisions before undergoing the procedure.
+
+ 
+
+4.Hyperbaric
+ oxygen therapy should not be performed as a form of beauty procedure. In view of its risks
+ of complications, it should be performed by registered medical practitioners on patients
+ with clinical indications.
+
+ 
+
+5.Dental
+ bleaching may lead to complications, especially if performed inappropriately or performed
+ on inappropriate clients, such as those suffering from pre-existing dental conditions. The
+ procedure should be performed by registered dentists.
+
+ 
+
+The
+Working Group supports the Hong Kong government s plan to introduce a new ordinance to deal with the control over the use of selected
+high-risk medical devices. Members of the Working Group consider that it would be more appropriate to deal with the use of medical devices
+which emitted different forms of energy and micro-needle therapy in this separate piece of legislation. To the best of our knowledge,
+the Hong Kong government has yet to announce any timetable for the passage of any legislation specifically regulating medical devices.
+
+ 
+
+The
+Working Group further recommends the setting up of an expert panel under the future medical device ordinance to advise on the risks and
+appropriate controls over new cosmetic procedures based on innovative technology.
+
+ 
+
+Advisory
+note and open letter issued by the Hong Kong Department of Health 
+
+ 
+
+The
+Hong Kong Department of Health issued an Advisory Note on the Provision of Cosmetic Procedures to beauty service providers based on the
+Recommendations and stated therein the general infection control principles. The Advisory Note reminded beauty service providers to refrain
+from performing procedures that should only be performed by registered medical practitioners or registered dentists. Failure to follow
+the advice may render oneself liable for offences under the MRO or the Dentists Registration Ordinance (Chapter 156 of the Laws of Hong
+Kong).
+
+ 
+
+An
+open letter was sent by the Hong Kong Department of Health to all registered medical practitioners stating the Recommendations that certain
+types of procedures should only be performed by registered medical practitioners/ dentists, and that enforcement action under the MRO
+or Dentists Registration Ordinance may be taken if the Recommendations are not followed. The letter also provided a list of reminders
+to registered medical practitioners when providing treatment to patients, including those referred by beauty service providers/beauty
+centers.
+
+ 
+
+ 105
+
+ 
+
+ 
+
+ 
+
+Effect
+on our Group
+
+ 
+
+Pursuant
+to the Recommendations, procedures involving injections and mechanical/chemical exfoliation of skin below the epidermis should be performed
+by registered medical practitioners in Hong Kong. Our directors consider that the Recommendations and the Advisory Note and open letter
+do not have any material adverse effect on our services centers because procedures of such nature are carried out by our registered medical
+practitioner and there are controls in place to ensure these procedures are performed by our registered medical practitioner.
+
+ 
+
+REGULATORY
+AUTHORITIES REGULATORS IN HONG KONG 
+
+ 
+
+Our
+business operations in Hong Kong are principally subject to the regulation of the Medical Council of Hong Kong, the Department of Health
+and the Hong Kong Consumer Council.
+
+ 
+
+The
+Medical Council of Hong Kong
+
+ 
+
+The
+Medical Council of Hong Kong was established under the MRO. The Medical Council of Hong Kong was founded to assure and promote quality
+in the medical profession in order to protect patients, foster ethical conduct, and develop and maintain high professional standards.
+It maintains a register of eligible medical practitioners, administers relevant licensing examinations, issues guidelines and the Hong
+Kong Medical Code of Professional Conduct, handles complaints lodged by members of the public and exercises regulatory and disciplinary
+powers over medical practitioners.
+
+ 
+
+The
+medical practitioner partnered with the Group is registered under the MRO and is therefore subject to the regulation of the Hong Kong
+Medical Council.
+
+ 
+
+Department
+of Health
+
+ 
+
+The
+Department of Health is the government agency in Hong Kong responsible for the execution of healthcare policies and statutory functions.
+There are three divisions under the Department that conduct duties particularly relevant to our business, namely the Drug Office, the
+Medical Device Division and the Office for Regulation of Private Healthcare Facilities.
+
+ 
+
+Hong
+Kong Consumer Council
+
+ 
+
+The
+Hong Kong Consumer Council protects the rights of consumers. Consumers have a right to dispute the price or quality of services if they
+find it unsatisfactory. The Hong Kong Consumer Council also assists consumers in cases of false claims made by companies with respect
+to a specific service offered by them
+
+ 
+
+Business
+registration requirement
+
+ 
+
+Business Registration
+Ordinance (Chapter 310 of the Laws of Hong Kong)
+
+ 
+
+The
+Business Registration Ordinance (Chapter 310 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to time,
+requires every person carrying on any business to make an application to the Commissioner of Inland Revenue in the prescribed manner
+for the registration of that business. The Commissioner of Inland Revenue must register each business for which a business registration
+application is made and as soon as practicable after the prescribed business registration fee and levy are paid and issue a business
+registration certificate or branch registration certificate for the relevant business or the relevant branch, as the case may be.
+
+ 
+
+As
+of the date of this prospectus, GCHL, DCMCL and MTL hold valid business registration certificates.
+
+ 
+
+ 106
+
+ 
+
+ 
+
+ 
+
+Regulations
+related to employment and labor protection.
+
+ 
+
+Employment
+Ordinance (Chapter 57 of the Laws of Hong Kong)
+
+ 
+
+The
+Employment Ordinance (Chapter 57 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to time, or the
+EO, is an ordinance enacted for, amongst other things, the protection of the wages of employees and the regulation of the general conditions
+of employment and employment agencies. Under the EO, an employee is generally entitled to, amongst other things, notice of termination
+of his or her employment contract; payment in lieu of notice; maternity protection in the case of a pregnant employee; not less than
+one rest day in every period of seven days; severance payments or long service payments; sickness allowance; statutory holidays or alternative
+holidays; and paid annual leave of up to 14 days depending on the period of employment.
+
+ 
+
+As
+of the date of this prospectus, GCHL, DCMCL and MTL have complied with the provisions under the EO.
+
+ 
+
+Employees 
+Compensation Ordinance (Chapter 282 of the Laws of Hong Kong)
+
+ 
+
+The
+Employees Compensation Ordinance (Chapter 282 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time
+to time, or the ECO, is an ordinance enacted for the purpose of providing for the payment of compensation to employees injured in the
+course of employment. As stipulated by the ECO, no employer shall employ any employee in any employment unless there is in force in relation
+to such an employee policy of insurance issued by an insurer for an amount not less than the applicable amount specified in the Fourth
+Schedule of the ECO in respect of the liability of the employer. According to the Fourth Schedule of the ECO, the insured amount shall
+be not less than HKD100,000,000 per event if a company has no more than 200 employees. Any employer who contravenes this requirement
+commits a criminal offence and is liable on conviction to a fine and imprisonment. An employer who has taken out an insurance policy
+under the ECO is required to display a prescribed notice of insurance in a conspicuous place on each of its premises where any employee
+is employed.
+
+ 
+
+As
+of the date of this prospectus, employee compensation insurance has been obtained for all employees of GCHL, DCMCL and MTL.
+
+ 
+
+Mandatory
+Provident Fund Schemes Ordinance (Chapter 485 of the Laws of Hong Kong)
+
+ 
+
+The
+Mandatory Provident Fund Schemes Ordinance (Chapter 485 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from
+time to time, or the MPFSO, is an ordinance enacted for the purposes of providing for the establishment of non-governmental mandatory
+provident fund schemes, or the MPF Schemes. The MPFSO requires every employer of an employee of 18 years of age or above but under 65
+years of age to take all practical steps to ensure the employee becomes a member of a registered MPF Scheme. Subject to the minimum and
+maximum relevant income levels, it is mandatory for both employers and their employees to contribute 5% of the employee s relevant
+income to the MPF Scheme. Any employer who contravenes this requirement commits a criminal offence and is liable on conviction to a fine
+and imprisonment.
+
+ 
+
+As
+of the date of this prospectus, the Company believes it has made all contributions required under the MPFSO.
+
+ 
+
+Regulations
+related to Personal Data
+
+ 
+
+Personal
+Data (Privacy) Ordinance (Chapter 486 of the Laws of Hong Kong)
+
+ 
+
+The
+Personal Data (Privacy) Ordinance (Chapter 486 of the Laws of Hong Kong), as amended, supplemented or otherwise modified from time to
+time, or the PDPO, imposes a statutory duty on data users to comply with the requirements of the six Data Protection Principles contained
+in Schedule 1 to the PDPO. The PDPO provides that a data user shall not do an act, or engage in a practice, that contravenes a Data Protection
+Principle unless the act or practice, as the case may be, is required or permitted under the PDPO. The six Data Protection Principles
+are:
+
+ 
+
+ 
+ 
+ 
+ Principle
+ 1 — purpose and manner of collection of personal data;
+
+ 
+
+ 107
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ Principle
+ 2 — accuracy and duration of retention of personal data;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Principle
+ 3 — use of personal data;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Principle
+ 4 — security of personal data;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Principle
+ 5 — information to be generally available; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Principle
+ 6 — access to personal data.
+
+ 
+
+ 
+
+Non-compliance
+with a Data Protection Principle may lead to a complaint to the Privacy Commissioner. The Privacy Commissioner may serve an enforcement
+notice to direct the data user to remedy the contravention and/or instigate prosecution actions. A data user who contravenes an enforcement
+notice commits an offense which may lead to a fine and imprisonment.
+
+ 
+
+The
+PDPO also gives data subjects certain rights, inter alia:
+
+ 
+
+ 
+ 
+ 
+ the
+ right to be informed by a data user whether the data user holds personal data of which the individual is the data subject;
+
+ 
+ 
+ 
+ if
+ the data user holds such data, to be supplied with a copy of such data; and
+
+ 
+ 
+ 
+ the
+ right to request correction of any data they consider to be inaccurate.
+
+ 
+ 
+
+The
+PDPO criminalizes, including but not limited to, the misuse or inappropriate use of personal data in direct marketing activities, non-compliance
+with a data access request and the unauthorized disclosure of personal data obtained without the relevant data user s consent.
+An individual who suffers damage, including injured feelings, by reason of a contravention of the PDPO in relation to his or her personal
+data may seek compensation from the data user concerned.
+
+ 
+
+As
+of the date of this prospectus, GCHL, DCMCL and MTL are in compliance with the provisions of the PDPO.
+
+ 
+
+As of the date of this
+prospectus, our subsidiaries have complied with all necessary governmental regulations in Hong Kong. However, in the event that our subsidiaries
+fail to comply with or breach of the relevant regulations, our financial results may be adversely impacted.
+
+ 
+
+MANAGEMENT
+
+ 
+
+Our
+board of directors is the primary decision-making body of our Company, responsible for setting fundamental business strategies and policies
+for the management and operation of our subsidiaries business and for monitoring their implementation.
+
+ 
+
+Our
+board of directors currently consists of two executive directors. The following table sets forth the names, ages, and titles of our directors,
+executive officers, and senior management/key personnel:
+
+ 
+
+ 
+ Name
+ 
+ Age
+ 
+ Title
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Executive
+ Officers and Directors:
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ng
+ Hon Kin
+ 
+ 65
+ 
+ Chairman,
+ Executive Director, and CEO 
+
+ 
+ Huang
+ Hsi-En
+ 
+ 39
+ 
+ Executive
+ Director 
+
+ 
+ Kelly
+ Sin
+ 
+ 45
+ 
+ Chief
+ Financial Officer
+
+ 
+ Dione
+ Leung
+ 
+ 57
+ 
+ Chief
+ Operation Officer
+
+ 
+ 
+ 
+ 
+
+ 
+ Independent
+ Non-executive Directors (Nominees):
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Tam
+ Kam Shing, Chris
+ 
+ 54
+ 
+ Independent
+ Non-executive Director Nominee
+
+ 
+ Francis
+ Colt deWolf III
+ 
+ 57
+ 
+ Independent
+ Non-executive Director Nominee
+
+ 
+ Kwan
+ Kar Man
+ 
+ 42
+ 
+ Independent
+ Non-executive Director Nominee
+
+ 
+ 
+
+ 108
+
+ 
+
+ 
+
+ 
+
+No
+arrangement or understanding exists between any such director or officer and any other persons pursuant to which any director or executive
+officer was elected as a director or executive officer. Our directors are elected annually and serve until their successors take office
+or until their death, resignation, or removal. The executive officers serve at the pleasure of the board of directors.
+
+ 
+
+Executive
+Officers and Directors:
+
+ 
+
+Mr.
+NG Hon Kin has served as MEDG s chairman, executive director, and CEO since March 28, 2024. Mr. Ng has also served as (i) a
+director of GCHL since March 23, 2021; (ii) a director of DCMCL since August 1, 2023; (iii) a director of MTHL since March 15, 2024;
+and (iv) a director of MTL since March 28, 2024. He has over 20 years of marketing, administration, and operating experience in medical
+aesthetic business. Mr. Ng is also the founder of the Group.
+
+ 
+
+Ms.
+HUANG Hsi-En has served as an executive director of MEDG. Ms. Huang Hsi-En has over 10 years of sourcing and marketing of medical
+aesthetic products. Ms. Huang Hsi-En received a Master Degree in Business Management from Hang Seng University of Hong Kong in 2022 and
+a Bachelor Degree in Information Technology from the Apollos University, Taiwan in 2020.
+
+ 
+
+Ms. SIN Pui
+Ying, Kelly ("Ms. Sin") has been appointed as the new chief financial officer on August 15, 2025, and assumed the role
+from September 15, 2025. Ms. Sin graduated from the University of Hong Kong with a degree of Bachelor of Business Administration in Accounting
+and Finance in 2022. She is a practising certified public accountant of the Hong Kong Institute of Certified Public Accountants and a
+member of the Institute of Chartered Accountants in England and Wales. Ms. Sin has over 20 years of working experience in auditing, accounting,
+investment and corporate finance. She is currently an audit partner of iEvolution CPA Limited. She had held several director roles in
+various listed companies in Hong Kong, including but not limited to, serving as executive director of Power Financial Group Limited (stock
+code: 397), which is listed on the Main Board of the Hong Kong Stock Exchange, for the period from April 15, 2021 to January 31, 2022
+and serving as a non-executive director and an executive director of On Real International Holdings Limited (stock code: 8245), which
+is listed on GEM of the Hong Kong Stock Exchange, for the period from September 21, 2019 to November 1, 2019 and the period from November
+1, 2019 to April 30, 2022, respectively.
+
+ 
+
+Independent
+Non-executive Directors
+
+ 
+
+Mr.
+TAM Kam Shing ("Chris" or "Mr. Tam") will serve as an independent non-executive director upon the closing
+of this offering. Chris has more than 20 years of experience in auditing, accounting and corporate governance. In addition, he has more
+than 10 years of experience in financial reporting of Hong Kong and China public companies. He had worked for Big 4 accounting firms
+in China and was a partner of Grant Thornton China. He has served as financial auditors and compliance auditors for corporation such
+as Air China, CNOOC, Kingdee, Coca Cola, Ericsson, Nortek, Foxconn for their initial public offerings. Chris received a Bachelor in Accounting
+from Hong Kong University of Science and Technology in 1994. He is a Chartered Accountant of Institute of Chartered Accountants in England
+and Wales, and a fellow member of Hong Kong Institute of Certified Public Accountants and Association of Chartered Certified Accountants.
+
+ 
+
+Mr.
+Francis Colt deWolf III ("Mr. deWolf") will serve as an independent non-executive director upon the closing of this offering.
+Mr. deWolf has more than 20 years of experience in financial service sector and is the President of Colt Capital LLC, a Florida-based
+company, whose principal activities focus on advising emerging market companies on private and public financing strategies, in particular,
+the reverse merger process. Prior to founding Colt Capital LLC, Mr. deWolf was a Senior Vice President at Oppenheimer and Company, where
+he was involved in the Chinese markets, focusing on restricted stock placements, reverse mergers and secondary financing for emerging
+and mid-size Chinese companies. Mr. deWolf is a graduate of Tulane University and received his business degree from the AB Freeman School
+of Business Studies at Tulane University.
+
+ 
+
+ 109
+
+ 
+
+ 
+
+ 
+
+Mr.
+Kwan Kar Man ("Mr. Kwan") will serve as an independent non-executive director upon the closing of this offering. Mr.
+Kwan obtained a Bachelor Degree in Accounting from Lingnan University, Hong Kong in 2003. He is an associate member of the Hong Kong
+Institute of Certified Public Accountants and a member of Institute of Chartered Accountants in England and Wales. Mr. Kwan has over
+18 years of experience in accounting, auditing and finance and is the founder of an UK accounting and tax consultancy firm, MSSK Corporate
+Consultancy (UK) Limited, since 2022. He is currently a director of MSSK Corporate Consultancy Limited, a Hong Kong private company which
+engages in provision of business consultancy services in Hong Kong. Apart of the aforesaid, Mr. Kwan is also a director of a Hong Kong
+private company which engages in trading of agricultural products, a company secretary of Dragon King Group Holdings Limited (stock code
+8493.hk) (whose shares are listed on the GEM of the Stock Exchange of Hong Kong Limited).
+
+ 
+
+Key
+Personnel / Consultants
+
+ 
+
+Our senior management
+is comprised of the following personnel:
+
+ 
+
+Ms.
+Leung Pik Ying ("Ms. Leung" or "Dione") has joined the Company as general manager since December 2021. Dione
+has more than 30 years of marketing, sales and shop management experiences in cosmetic companies. Before that, she was a beautician for
+6 years. Dione has focused on the cosmetic industry for substantially all of her career. She will serve as our chief operation officer
+upon the closing of this offering.
+
+ 
+
+Dr.
+Pang Sai Yau acts as the medical partner and consultant of the Company since inception. He is one of the pioneers in Hong Kong s
+medical aesthetic industry. He is also one of the founders of Association of Doctors in Aesthetic Medicine (Hong Kong). Dr. Pang graduated
+as Master of Philosophy from medical school of the Chinese University of Hong Kong. He was elected as the member of Royal College of
+Physician of the United Kingdom in 2001, was awarded postgraduate diploma in practical dermatology of University of Wales, College of
+Medicine in 2003, and was admitted as a Fellow of the Faculty of Medicine of Australasian College of Cosmetic Surgery in 2007.
+
+ 
+
+Committees
+of the Board of Directors
+
+ 
+
+Our
+board of directors has approved the establishment of an audit committee, a compensation committee, and a nomination committee, each of
+which will operate pursuant to a charter upon the effectiveness of the registration statement of which this prospectus is a part. The
+board of directors may also establish other committees from time to time to assist our Company and the board of directors. Upon the effectiveness
+of the registration statement of which this prospectus is a part, the composition and functioning of all of our committees will comply
+with all applicable requirements of the Sarbanes-Oxley Act, Nasdaq and SEC rules and regulations, if applicable. Upon our listing on
+Nasdaq, each committee s charter will be available on our website http://www.doctorsconcept.com. The reference to our website
+address does not constitute incorporation by reference of the information contained at or available through our website, and you should
+not consider it to be part of this prospectus.
+
+ 
+
+Audit
+committee
+
+ 
+
+Mr. Tam, Mr. deWolf, and Mr.
+Kwan, all of whom are our independent non-executive directors, will serve on the audit committee, which will be chaired by Mr. Tam. Our
+board of directors has determined that each is "independent" for audit committee purposes as that term is defined by the
+rules of the SEC and Nasdaq, and that each has sufficient knowledge in financial and auditing matters to serve on the audit committee.
+Our board of directors has designated Mr. Tam as an "audit committee financial expert," as defined under the applicable rules
+of the SEC. The audit committee s responsibilities include:
+
+ 
+
+ 
+ 
+ 
+ appointing,
+ approving the compensation of, and assessing the independence of our independent registered public accounting firm;
+
+ 
+ 
+ 
+ pre-approving
+ auditing and permissible non-audit services, and the terms of such services, to be provided by our independent registered public
+ accounting firm;
+
+ 
+
+ 110
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ reviewing
+ the overall audit plan with our independent registered public accounting firm and members of management responsible for preparing
+ our financial statements;
+
+ 
+ 
+ 
+ reviewing
+ and discussing with management and our independent registered public accounting firm our annual and quarterly financial statements
+ and related disclosures as well as critical accounting policies and practices used by us;
+
+ 
+ 
+ 
+ coordinating
+ the oversight and reviewing the adequacy of our internal control over financial reporting;
+
+ 
+ 
+ 
+ establishing
+ policies and procedures for the receipt and retention of accounting-related complaints and concerns; recommending, based upon the
+ audit committee s review and discussions with management and our independent registered public accounting firm, whether our
+ audited financial statements shall be included in our Annual Report on Form 20-F;
+
+ 
+ 
+ 
+ monitoring
+ the integrity of our financial statements and our compliance with legal and regulatory requirements as they relate to our financial
+ statements and accounting matters;
+
+ 
+ 
+ 
+ preparing
+ the audit committee report required by SEC rules to be included in our annual proxy statement;
+
+ 
+ 
+ 
+ reviewing
+ all related person transactions for potential conflict of interest situations and approving all such transactions; and
+
+ 
+ 
+ 
+ reviewing
+ earnings releases.
+
+ 
+ 
+
+Compensation
+committee
+
+ 
+
+Mr. Tam, Mr. deWolf, and Mr.
+Kwan all of whom are our independent non-executive directors, will serve on the compensation committee, which will be chaired by Mr.
+Kwan. Our board of directors has determined that each such member satisfies the "independence" requirements of Rule 5605(a)(2)
+of the Listing Rules of the Nasdaq Stock Market. The compensation committee s responsibilities include:
+
+ 
+
+ 
+ 
+ 
+ evaluating
+ the performance of our CEO in light of our Company s corporate goals and objectives and based on such evaluation: (i) recommending
+ to the board of directors the cash compensation of our CEO; and (ii) reviewing and approving grants and awards to our CEO under equity-based
+ plans;
+
+ 
+ 
+ 
+ reviewing
+ and recommending to the board of directors the cash compensation of our other executive officers;
+
+ 
+ 
+ 
+ reviewing
+ and establishing our overall management compensation, philosophy, and policy;
+
+ 
+ 
+ 
+ overseeing
+ and administering our compensation and similar plans;
+
+ 
+ 
+ 
+ reviewing
+ and approving the retention or termination of any consulting firm or outside advisor to assist in the evaluation of compensation
+ matters and evaluating and assessing potential and current compensation advisors in accordance with the independence standards identified
+ in the applicable Nasdaq rules;
+
+ 
+ 
+ 
+ retaining
+ and approving the compensation of any compensation advisors;
+
+ 
+ 
+ 
+ reviewing
+ and approving our policies and procedures for the grant of equity-based awards;
+
+ 
+ 
+ 
+ reviewing
+ and recommending to the board of directors the compensation of our directors; and
+
+ 
+ 
+ 
+ preparing
+ the compensation committee report required by SEC rules, if and when required.
+
+ 
+
+ 
+
+Nomination
+committee
+
+ 
+
+Mr. Tam, Mr. deWolf, and Mr.
+Kwan, all of whom are our independent non-executive directors, will serve on the nomination committee, which will be chaired by Mr. Kwan.
+Our board of directors has determined that each member of the nomination committee is "independent" as defined in applicable
+Nasdaq rules. The nomination committee s responsibilities include:
+
+ 
+
+ 
+ 
+ 
+ developing
+ and recommending to the board of directors criteria for board and committee membership;
+
+ 
+ 
+ 
+ establishing
+ procedures for identifying and evaluating director candidates, including nominees recommended by stockholders; and
+
+ 
+ 
+ 
+ reviewing
+ the composition of the board of directors to ensure that it is composed of members containing the appropriate skills and expertise
+ to advise us.
+
+ 
+ 
+
+While
+we do not have a formal policy regarding board diversity, our nomination committee and board of directors will consider a broad range
+of factors relating to the qualifications and background of nominees, which may include diversity (not limited to race, gender, or national
+origin). Our nomination committee s and board of directors priority in selecting board members is the identification of
+persons who will further the interests of our shareholders through their established record of professional accomplishment, the ability
+to contribute positively to the collaborative culture among board members, knowledge of our business, understanding of the competitive
+landscape and professional and personal experience and expertise relevant to our growth strategy.
+
+ 
+
+ 111
+
+ 
+
+ 
+
+ 
+
+Foreign
+Private Issuer Status
+
+ 
+
+The
+Nasdaq listing rules include certain accommodations in the corporate governance requirements that allow foreign private issuers, such
+as us, to follow "home country" corporate governance practices in lieu of the otherwise applicable corporate governance standards
+of Nasdaq Markets. The application of such exceptions requires that we disclose each Nasdaq Markets corporate governance standard that
+we do not follow and describe the Cayman Islands corporate governance practices we do follow in lieu of the relevant Nasdaq Markets corporate
+governance standard. However, we currently follow the Nasdaq Markets corporate governance standards listed below:
+
+ 
+
+ 
+ 
+ 
+ the
+ majority independent director requirement under Section 5605(b)(1) of the Nasdaq Marketplace Listing rules;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ requirement under Section 5605(d) of the Nasdaq Marketplace Listing Rules that a compensation committee comprised solely of independent
+ directors governed by a compensation committee charter oversee executive compensation; 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ requirement under Section 5605(e) of the Nasdaq Marketplace Listing Rules that director nominees be selected or recommended for selection
+ by either a majority of the independent directors or a nominations committee comprised solely of independent directors;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ shareholder approval requirements under Section 5635 of the Nasdaq Marketplace Listing Rules; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ requirement under Section 5605(b)(2) of the Nasdaq Marketplace Listing Rules that the independent directors have regularly scheduled
+ meetings with only the independent directors present.
+
+ 
+ 
+
+Code
+of Conduct and Code of Ethics
+
+ 
+
+We
+have adopted a written code of business conduct and ethics that applies to our directors, officers, and employees, including our CEO,
+chief financial officer, principal accounting officer or controller or persons performing similar functions. The code will become effective
+immediately prior to the completion of this offering. Following the effectiveness of the registration statement of which this prospectus
+is a part, a current copy of this code will be posted on the Corporate Governance section of our website, which will be at http://www.doctorscomconcept.com.
+The information on our website is deemed not to be incorporated in this prospectus or to be a part of this prospectus. We intend to disclose
+any amendments to the code of ethics, and any waivers of the code of ethics or the code of conduct for our directors, executive officers,
+and senior finance executives, on our website to the extent required by applicable U.S. federal securities laws and the Nasdaq corporate
+governance rules.
+
+ 
+
+Compensation
+of Directors and Senior Management/Executive Personnel
+
+ 
+
+Our
+directors and members of our senior management receive compensation in the form of salaries, allowances, bonuses, and other benefits-in-kind,
+including our contribution to the pension scheme. Our compensation committee determines the salaries of our directors and members of
+our senior management based on their qualifications, positions, and seniority.
+
+ 
+
+Notwithstanding
+the compensation table below: (i) no remuneration was paid to our directors or the five highest paid individuals as an inducement to
+join, or upon joining, our Group; (ii) no compensation was paid to, or receivable by, our directors or past directors or the five highest
+paid individuals during the fiscal years ended June 30, 2024 and 2023 for the loss of office as director of any member of our Group or
+of any other office in connection with the management of the affairs of any member of our Group; and (iii) none of our directors waived
+any emoluments during the same period. Notwithstanding the compensation table below, no director has been paid in cash or shares or otherwise
+by any person either to induce him to become, or to qualify him as a director, or otherwise for service rendered by him in connection
+with the promotion or formation of us.
+
+ 
+
+ 112
+
+ 
+
+ 
+
+ 
+
+For
+the six months ended December 31, 2024 and 2023, we paid an aggregate of US$130,566 and US$123,193 to our directors and our executive
+officers, respectively. For the years ended June 30, 2024 and 2023, we paid an aggregate of US$283,113 and US$254,103 to our directors
+and our executive officers, respectively. Compensation includes salary, allowances, and any employer s contribution social security.
+
+ 
+
+Mandatory
+Provident Fund
+
+ 
+
+MPF
+is a compulsory saving scheme (pension fund) for the retirement of residents in Hong Kong. Most employees and their employers are required
+to contribute monthly to mandatory provident fund schemes provided by approved private organizations, according to their salaries and
+the period of employment. The MPF was implemented in December 2000 following the enactment of the Mandatory Provident Fund Schemes Ordinance
+on July 27, 1995. The MPF Schemes Authority (MPFA) is charged with supervising the provision of MPF schemes – it registers schemes
+and ensures that approved trustees administer schemes prudently, ensuring compliance including inspections, audits, and investigations.
+
+ 
+
+The
+MPF scheme is mandatory for all employees in Hong Kong who have an employment contract of 60 days or more and also applies to self-employed
+persons. Under the MPF scheme, the choice of the scheme is the responsibility of the employer (for which the legislation defines three
+types): (i) master trust scheme; (ii) employer sponsored scheme; or (iii) industry scheme. The scheme operates on the principle of fully
+funded defined contributions into a privately managed plan fund contributed by employers and employees managed as a trust, which compartmentalizes
+fund assets from those of the manager. Investment decisions are delegated to a trustee in the private sector.
+
+ 
+
+GCHL,
+our Operating Subsidiary in Hong Kong, implemented a MPF with a major international assurance company to provide retirement benefits
+for its employees. All permanent full-time employees are eligible to join the MPF. Contributions to the MPF by eligible employees of
+the MPF and the employer are both at 5% of the eligible employee s monthly salary and are subject to a maximum mandatory contribution
+of HKD1,500 (US$192) monthly.
+
+ 
+
+The
+contributions to the MPF are recognized as employee benefit expense when they are due and are charged to the consolidated statement of
+income (loss). The total contributions to the MPF of our subsidiaries in Hong Kong for years ended June 30, 2024 and 2023 amounted to
+US$88,303 and US$85,625, respectively. GCHL has no other obligation to make payments in respect of retirement benefits of the employees.
+
+ 
+
+Directors 
+Agreements
+
+ 
+
+Each
+of our directors has entered into a service agreement with the Company. The term of service of each director will commence immediately
+prior to the completion of the offering. The terms and conditions of each such Director s Agreement are similar in all material
+aspects. Each director s agreement is for an initial term of one year and will continue until the director s successor is
+duly elected and qualified. Each director will be up for re-election each year at the annual shareholders meeting and, upon re-election,
+the terms, and provisions of his or her director s agreement will remain in full force and effect. Any director s agreement
+may be terminated for any or no reason by the director or at a meeting called expressly for that purpose by a vote of the shareholders
+holding more than 50% of the Company s issued and outstanding Ordinary Shares entitled to vote.
+
+ 
+
+ 113
+
+ 
+
+ 
+
+ 
+
+Under
+the service agreements, we will pay an aggregate of US$60,000 per annum as the salary of our independent non-executive directors.
+
+ 
+
+Other
+than as disclosed above, none of our directors has entered into a service agreement with our Company or any of our subsidiaries that
+provides for benefits upon termination of employment.
+
+ 
+
+Employment
+Letters
+
+ 
+
+We
+have entered to into employment agreements with each of our executive officers. Under the employment agreements, our executive officers
+are entitled to (i) payment of a monthly salary payable at the end of each month commencing upon closing of this offering; and (ii) a
+discretionary performance bonus determined by the compensation committee and/or the board at the end of the fiscal year. Either party
+shall have the right to terminate the agreement by giving to the other party not less than one month s notice in writing.
+
+ 
+
+Indemnification
+Agreements
+
+ 
+
+We
+have entered into indemnification agreements with each of our directors and executive officers. Under these agreements, we agree to indemnify
+our directors and executive officers against certain liabilities and expenses incurred by such persons in connection with claims made
+by reason of their being a director or officer of our Company.
+
+ 
+
+Insofar
+as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers or persons controlling
+us under the foregoing provisions, we have been informed that, in the opinion of the SEC, such indemnification is against public policy
+as expressed in the Securities Act and is therefore unenforceable.
+
+ 
+
+PRINCIPAL
+SHAREHOLDERS
+
+ 
+
+The
+following table sets forth information regarding beneficial ownership of our share capital by:
+
+ 
+
+ 
+ 
+ 
+ each
+ person, or group of affiliated persons, known by us to beneficially own more than 5% of our shares;
+
+ 
+ 
+ 
+ each
+ of our executive officers;
+
+ 
+ 
+ 
+ each
+ of our directors; and
+
+ 
+ 
+ 
+ all
+ of our current executive officers, directors as a group.
+
+ 
+ 
+
+ 114
+
+ 
+
+ 
+
+ 
+
+Applicable
+percentage ownership is based on 27,000,000 Ordinary Shares of our Company issued and outstanding as of the date of this prospectus and,
+with respect to percent ownership after this offering, assumes no exercise of the underwriters over-allotment option.
+
+ 
+
+The
+information presented below regarding beneficial ownership of our voting securities has been presented in accordance with the rules of
+the SEC and is not necessarily indicative of ownership for any other purpose. Under these rules, a person is deemed to be a "beneficial
+owner" of a security if that person has or shares the power to vote or direct the voting of the security or the power to dispose
+or direct the disposition of the security. A person is deemed to own beneficially any security as to which such person has the right
+to acquire sole or shared voting or investment power within sixty (60) days through the conversion or exercise of any convertible security,
+warrant, option, or other right. More than one (1) person may be deemed to be a beneficial owner of the same securities. The percentage
+of beneficial ownership by any person as of a particular date is calculated by dividing the number of shares beneficially owned by such
+person, which includes the number of shares as to which such person has the right to acquire voting or investment power within sixty
+(60) days, by the sum of the number of shares outstanding as of such date, plus the number of shares as to which such person has the
+right to acquire voting or investment power within sixty (60) days. Consequently, the denominator used for calculating such percentage
+may be different for each beneficial owner. Except as otherwise indicated below and under applicable community property laws, believe
+that the beneficial owners of our shares listed below have sole voting and investment power with respect to the shares shown.
+
+ 
+
+Unless
+otherwise noted below, the address of each person listed on the table is Unit 15-16, 22/F., CEO Tower, 77 Wing Hong Street, Cheung Sha
+Wan, Hong Kong.
+
+ 
+
+ 
+ 
+ Shares
+ Beneficially 
+ Owned Before this Offering (1) 
+ Shares
+ Beneficially 
+ Owned after this Offering (2) 
+ Voting
+ Power after this Offering (3) 
+
+ 
+ Name
+ of Beneficial Owner 
+ Number 
+ Percentage 
+ Number 
+ Percentage 
+ Percentage 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Executive
+ Officers and Directors* 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ng
+ Hon Kin (4) 
+ 17,550,000 
+ 65.00% 
+ 17,550,000 
+ 57.86% 
+ 96.49%
+
+ 
+ Huang
+ Hsi-En (5) 
+ 17,550,000 
+ 65.00% 
+ 17,550,000 
+ 57.86% 
+ 96.49%
+
+ 
+ Tam
+ Kam Shing 
+ - 
+ -% 
+ - 
+ - 
+ 
+
+ 
+ Francis
+ deWolf III 
+ - 
+ -% 
+ - 
+ - 
+ 
+
+ 
+ Kwan
+ Kar Man 
+ - 
+ -% 
+ - 
+ - 
+ 
+
+ 
+ Kelly
+ Sin 
+ - 
+ -% 
+ - 
+ - 
+ 
+
+ 
+ Dione
+ Leung 
+ - 
+ -% 
+ - 
+ - 
+ 
+
+ 
+ All
+ executive officers and directors as a group 
+ 17,550,000 
+ 65.00% 
+ 17,550,000 
+ 57.86% 
+ 96.49%
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 5%
+ Shareholders: (6) 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Master
+ Centric Limited 
+ 17,550,000 
+ 65.00% 
+ 17,550,000 
+ 57.86% 
+ 96.49%
+
+ 
+ Many
+ Trillion International Limited 
+ 1,350,000 
+ 5.00% 
+ 1,350,000 
+ 4.45% 
+ # 
+
+ 
+ Express
+ Essential Holdings Limited 
+ 1,350,000 
+ 5.00% 
+ 1,350,000 
+ 4.45% 
+ # 
+
+ 
+ Winlover
+ Limited 
+ 1,350,000 
+ 5.00% 
+ 1,350,000 
+ 4.45% 
+ # 
+
+ 
+ Ace
+ Miracle Group Limited 
+ 2,700,000 
+ 10.00% 
+ 2,700,000 
+ 8.90% 
+ # 
+
+ 
+ Able
+ Talent Business Limited 
+ 1,350,000 
+ 5.00% 
+ 1,350,000 
+ 4.45% 
+ # 
+
+ 
+
+ 
+
+*
+Including independent non-executive directors whose term of service will commence immediately prior to the completion of the offering.
+
+#
+Less than 1% of our total voting power.
+
+ 
+
+ 
+ 
+ (1)
+ 
+ Based
+ on 27,000,000 Ordinary Shares, consist of 9,450,000 Class A Ordinary Shares and 17,550,000 Class B Ordinary Shares, issued and outstanding
+ immediately prior to the offering. 
+
+ 
+ 
+ (2)
+ Based
+ on 30,333,333 Ordinary Shares outstanding immediately after the offering assuming the underwriter does not exercise the over-allotment
+ option.
+
+ 
+ 
+ (3)
+ Based
+ on 30,333,333 Ordinary Shares, consist of 12,783,333 Class A Ordinary Shares and 17,550,000 Class B Ordinary Shares outstanding
+ immediately after the offering assuming the underwriter does not exercise the over-allotment option. Each Class A Ordinary Share
+ shall entitle its holder to one (1) vote per share and each Class B Ordinary Share shall entitle its holder to twenty (20) votes
+ per share.
+
+ 
+ 
+ (4)
+ Represented
+ 17,550,000 Class B Ordinary Shares held by MCL. Mr. Ng Hon Kin holds 99% shareholding in MCL. The registered address of MCL is OMC
+ Chambers, Wickhams Cay 1, Road Town, Tortola, British Virgin Islands.
+
+ 
+ 
+ (5)
+ Represented
+ 17,550,000 Class B Ordinary Shares held by MCL. Ms. Huang Hsi-En, our director, holds 1% shareholding in MCL. The registered address
+ of MCL is OMC Chambers, Wickhams Cay 1, Road Town, Tortola, British Virgin Islands.
+
+ 
+ 
+ (6)
+ Many
+ Trillion International Ltd. Limited, a company incorporated under the laws of British Virgin Islands with registered address at OMC
+ Chambers, Wickhams Cay 1, Road Town, Tortola, British Virgin Islands, wholly owned by Yeung Tsz Tsung.
+
+ 
+ 
+ 
+ Express
+ Essential Holdings Limited, a company incorporated under the laws of British Virgin Islands with registered address at OMC Chambers,
+ Wickhams Cay 1, Road Town, Tortola, British Virgin Islands, wholly owned by Lim Yung Kwong, Cat.
+
+ 
+ 
+ 
+ Winlover
+ Limited, a company incorporated under the laws of British Virgin Islands with registered address at OMC Chambers, Wickhams Cay 1,
+ Road Town, Tortola, British Virgin Islands, wholly owned by Zhang Chuyuan.
+
+ 
+ 
+ 
+ Ace
+ Miracle Group Limited, a company incorporated under the laws of British Virgin Islands with registered address at OMC Chambers, Wickhams
+ Cay 1, Road Town, Tortola, British Virgin Islands, owned by Cheung Tak Shun, Dickson, Lee Ha and Kwong Fung Yung. 
+
+ 
+ 
+ 
+ Able
+ Talent Business Ltd., a company incorporated under the laws of British Virgin Islands with registered address at OMC Chambers, Wickhams
+ Cay 1, Road Town, Tortola, British Virgin Islands, wholly owned by So Chun Him.
+
+ 
+ 
+
+The
+following table show the dual class shares ownership before and after this offering:
+
+ 
+
+ 
+ 
+ Shares
+ Beneficially Owned Before this Offering (1) 
+ Shares
+ Beneficially Owned after this Offering (2) 
+
+ 
+ Name of Beneficial Owner 
+ Number 
+ Percentage 
+ Number 
+ Percentage 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Class A Ordinary Shares 
+ 
+ 
+ 
+ 
+
+ 
+ Many Trillion International Limited 
+ 1,350,000 
+ 5.00% 
+ 1,350,000 
+ 4.45%
+
+ 
+ Express Essential Holdings Limited 
+ 1,350,000 
+ 5.00% 
+ 1,350,000 
+ 4.45%
+
+ 
+ Winlover Limited 
+ 1,350,000 
+ 5.00% 
+ 1,350,000 
+ 4.45%
+
+ 
+ Ace Miracle Group Limited 
+ 2,700,000 
+ 10.00% 
+ 2,700,000 
+ 8.90%
+
+ 
+ Able Talent Business Limited 
+ 1,350,000 
+ 5.00% 
+ 1,350,000 
+ 4.45%
+
+ 
+ Essential
+ Quality Limited (3) 
+ 810,000 
+ 3.00% 
+ 810,000 
+ 2.67%
+
+ 
+ MCA
+ Limited (4) 
+ 540,000 
+ 2.00% 
+ 540,000 
+ 1.78%
+
+ 
+ Public investors 
+ 
+ 0.00% 
+ 3,333,333 
+ 10.99%
+
+ 
+ All Class A Ordinary Shares 
+ 9,450,000 
+ 35.00% 
+ 12,783,333 
+ 42.14%
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Class B Ordinary Shares 
+ 
+ 
+ 
+ 
+
+ 
+ Master Centric Limited 
+ 17,550,000 
+ 65.00% 
+ 17,550,000 
+ 57.86%
+
+ All Class B Ordinary Shares
+ 
+ 
+ 17,550,000
+ 
+ 
+ 
+ 65.00
+ %
+ 
+ 
+ 17,550,000
+ 
+ 
+ 
+ 57.86
+ %
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ All classes ordinary shares
+ 
+ 
+ 27,000,000
+ 
+ 
+ 
+ 100.00
+ %
+ 
+ 
+ 30,333,333
+ 
+ 
+ 
+ 100.00
+ %
+ 
+
+ 
+
+ 
+
+ 
+ 
+ (1) 
+ Based on 27,000,000 Ordinary Shares, consist of 9,450,000 Class
+ A Ordinary Shares and 17,550,000 Class B Ordinary Shares, issued and outstanding immediately prior to the offering.
+
+ 
+ 
+ (2) 
+ Based on 30,333,333 Ordinary Shares outstanding immediately after
+ the offering assuming the underwriter does not exercise the over-allotment option.
+
+ 
+ 
+ (3)
+ Essential Quality Limited, a company incorporated under the laws
+ of British Virgin Islands with registered address at OMC Chambers, Wickhams Cay 1, Road Town, Tortola, British Virgin Islands.
+
+ 
+ 
+ (4)
+ MCA Limited, a company incorporated under the laws of British Virgin
+ Islands with registered address at OMC Chambers, Wickhams Cay 1, Road Town, Tortola, British Virgin Islands.
+
+ 
+
+ 
+
+ 115
+
+ 
+
+ 
+
+ 
+
+RELATED
+PARTY TRANSACTIONS
+
+ 
+
+Related
+Parties
+
+ 
+
+We
+have adopted an audit committee charter, which requires the committee to review all related-party transactions on an ongoing basis and
+all such transactions be approved by the committee. The charter will become effective immediately prior to the completion of this offering.
+We currently engage in various transaction with our Controlling Shareholder and its affiliates.
+
+ 
+
+Set forth below are the
+related parties of our Company that we have engaged in related party transactions up to the date of this prospectus and during the years
+of 2023 and 2024.
+
+ 
+
+ 
+ 
+ 
+ Relationship
+
+ 
+ Mr. Ng Hon Kin
+ 
+ Chairman, executive director, and a substantial shareholder of the Company
+
+ 
+ Global Medical Equipment Co., Ltd.
+ 
+ Company controlled by Mr. Ng.
+
+ 
+ Smart Key International Consultant Co., Ltd.
+ 
+ Company controlled by Mr. Ng.
+
+ 
+ Be Health Co., Ltd. 
+ 
+ Company controlled by Mr. Ng.
+
+ 
+ Ms. Huang Weisi
+ 
+ Prior director of our subsidiaries including GCHL and DCMCL
+
+ 
+ Euro Cos Co., Ltd
+ 
+ Company controlled by Ms. Huang Weisi
+
+ 
+ 
+
+Guarantees 
+
+ 
+
+Certain
+related parties provided guarantees to the Company in connection with its bank borrowings of the Group. The bank loans of the Group consisted
+of the following:
+
+ 
+
+ 
+ Bank Name 
+ Nature of Loan 
+ HK$ 000 
+ 
+
+ 
+ Bank of China 
+ 36-month borrowing 
+ 2,000 
+ 
+
+ 
+ Bank of China 
+ 120-month term borrowing 
+ 4,000 
+ 
+
+ 
+ Bank of China 
+ 120-month term borrowing 
+ 2,000 
+ 
+
+ 
+ Bank of China 
+ 120-month term borrowing 
+ 3,000 
+ 
+
+ 
+
+ 
+
+The following table summarizes key terms of bank borrowings:
+
+ 
+
+ 
+ 
+ Principle drawn down 
+ Start Date 
+ Mature Date 
+ Interest %(1) 
+ Personal Guarantee(2)
+
+ 
+ 
+ HKD 
+ USD 
+ 
+ 
+ 
+ 
+
+ 
+ 1) 
+ 2,000,000 
+ 256,410 
+ January 8, 2020 
+ January 8, 2023 
+ 0.5% monthly 
+ Ms. Huang Weisi
+
+ 
+ 2) 
+ 4,000,000 
+ 512,821 
+ May 8, 2020 
+ May 7, 2030 
+ P-2.5% 
+ Ms. Huang Weisi
+
+ 
+ 3) 
+ 2,000,000 
+ 256,410 
+ August 30, 2021 
+ August 29, 2031 
+ P-2.5% 
+ Ms. Huang Weisi
+
+ 
+ 4) 
+ 3,000,000 
+ 384,615 
+ May 27, 2022 
+ May 26, 2032 
+ P-2.5% 
+ Ms. Huang Weisi
+
+ 
+
+ 
+
+(1)P
+ represents prime lending rate of Hong Kong.
+
+ 
+
+ 
+(2)All
+ of the above bank borrowings are personally guaranteed by Ms. Huang Weisi, and the guarantees
+ are assumed by Mr. Ng on April 2, 2024 (See Note 13).
+
+ 
+
+Transactions
+with related parties are conducted in the normal course of business and at prices and terms no less than those charged to and contracted
+with other independent third parties. All personal guarantees are assumed by Mr. Ng Hon Kin. We have engaged in various transactions
+with our subsidiaries and affiliated companies. See Note 13 of the notes to the Consolidated Financial Statements. We have not issued
+any guarantees in favor of our consolidated subsidiaries or other related parties.
+
+ 
+
+ 116
+
+ 
+
+ 
+
+ 
+
+Related
+party balances
+
+ 
+
+a)
+Summary of balances with related parties
+
+ 
+
+We enter into working capital
+transactions with our Controlling Shareholder. The amounts below were unsecured, non-interest bearing and due on demand. On August 26,
+2024, Mr. Ng entered into agreements with the Company s related companies, which are controlled by Mr. Ng, that Mr. Ng would assume
+and be assigned for all the current accounts of related parties. Mr. Ng agreed to collect the balance due to him after this offering.
+We have not issued any guarantees in favor of our consolidated subsidiaries or other related parties.
+
+ 
+
+We also enter into related
+party transactions with our suppliers. We paid Global Medical Equipment Co., Ltd. and Euro Cos Co., Ltd for purchase of consumables for
+our day-to-day operations.
+
+ 
+
+Amounts due
+(to) from related parties mainly consist of the following working capital transactions:
+
+ 
+
+ 
+ 
+ For the six months ended December
+ 31, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ (Unaudited) 
+ (Unaudited)
+ 
+
+ 
+ Fund transfer to Mr. Ng Hon Kin 
+ US$- 
+ US$-
+ 
+
+ 
+ Amount due from related parties 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+
+ 
+ Payment by Mr. Ng Hon Kin 
+ (1,175,464) 
+ (925,958)
+
+ 
+ Amount due (to) related parties 
+ US$(1,175,464) 
+ US$(925,958)
+
+ 
+ 
+ 
+ 
+
+ 
+ Accounts payable – Global Medical Equipment Co., Ltd. 
+ US$(4,184) 
+ US$(4,161)
+
+ 
+ Accounts payable – Euro Cos Co., Ltd. 
+ (264) 
+ - 
+
+ 
+ Accounts payable – related parties 
+ US$(4,448) 
+ US$(4,161)
+
+ 
+ 
+ 
+ 
+
+ 
+ Amount due (to) from related parties, net 
+ US$(1,179,912) 
+ US$(930,119)
+
+ 
+
+ 
+
+ 
+ 
+ For the years ended June 30, 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ Fund transfer to Mr. Ng Hon Kin 
+ US$- 
+ US$
+46,968 
+
+ 
+ Payment to Global Medical Equipment Co., Ltd. 
+ - 
+ - 
+
+ 
+ Payment to Smart Key International Consultant Co., Ltd. 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+
+ 
+ Unpaid capital of subsidiary by Ms. Huang Weisi 
+ - 
+ - 
+
+ 
+ Amount due from related parties 
+ - 
+ 46,968 
+
+ 
+ 
+ 
+ 
+
+ 
+ Payment by Be Health Co., Ltd. 
+ US$
+- 
+ - 
+
+ 
+ Payment by Mr. Ng Hon Kin 
+ (576,336) 
+ (152,648)
+
+ 
+ Amount due (to) related parties 
+ US$
+(576,336) 
+ US$
+(152,648)
+
+ 
+ 
+ 
+ 
+
+ 
+ Accounts payable – Global Medical Equipment Co., Ltd. 
+ US$
+(4,162) 
+ US$
+- 
+
+ 
+ Accounts payable – Euro Cos Co., Ltd. 
+ (51) 
+ 
+
+ 
+ Accounts payable – related parties 
+ US$
+(4,213) 
+ US$
+- 
+
+ 
+ 
+ 
+ 
+
+ 
+ Amount due (to) from related parties, net 
+ US$
+(580,549) 
+ US$
+(105,680)
+
+ 
+
+ 
+
+b)
+Summary of transactions with related parties
+
+ 
+
+We entered into a sub-lease
+in relation to the property located at Office No. 6-7, 8/F, Kwong Wah Plaza, 11 Tai Tong Road, Yuen Long, New Territories with Be Health
+Company Limited on a short-term and monthly basis effective from August 3, 2024, pursuant to a cooperation agreement between Be Health
+Company Limited and GCHL dated July 29, 2024. We have paid rental fees in aggregate of US$30,366 and US$61,107 for the six months ended
+December 31, 2024 and for the eleven months ended May 31, 2025. 
+
+ 
+
+We also entered into a
+management agreement with Smart Key International Consultant Company Limited on July 31, 2024, in relation to the lease for the property
+located at Unit 15-16, 22/F, CEO Tower, 77 Wing Hong Street, Cheung Sha Wan, Kowloon. We paid management fees in respect of the property
+of US$14,817 and US$39,527 for the six months ended December 31, 2024 and for the eleven months ended May 31, 2025. We have also paid
+management fee in respect of manpower services to Smart Key International Consultant Company Limited in the amounts of US$618,963 and
+US$103,596 for the years ended June 30, 2023 and 2024 and nil for the six months ended December 31, 2024.
+
+ 
+
+We purchased equipment,
+materials and services from Global Medical Equipment Co., Ltd.. We have paid in the amounts of US$44,339 and US$4,157 for the years ended
+June 30, 2023 and 2024 and nil for the six months ended December 31, 2024.
+
+ 
+
+We purchased equipment,
+materials and services from Euro Cos Co., Ltd. We have paid in the amounts of US$463 and nil for the years ended June 30, 2023 and 2024
+and US$212 for the six months ended December 31, 2024.
+
+ 
+
+We also paid for the rental
+expense of our executive in aggregate of US$18,756 for the year ended June 30, 2023.
+
+ 
+
+The
+following table shows transactions with related parties:
+
+ 
+
+ 
+ 
+ For
+ the eleven months ended
+
+ May 31,
+ 
+
+ 
+ 
+ 2025 
+
+ 
+ 
+ USD
+
+(Unaudited)
+
+ 
+
+ 
+ 
+ 
+
+ 
+ Payments on behalf: 
+ 
+
+ 
+ Management fees – Smart Key International Consultant Co., Ltd. 
+ - 
+
+ 
+ Purchase of equipment, materials and services 
+ - 
+
+ 
+ Rental for the shop and office 
+ 100,634 
+
+ 
+ 
+ 
+
+ 
+ Total 
+ 100,634 
+
+ 
+
+ 
+
+ 
+ 
+ For
+ the six months ended 
+ December
+ 31,
+ 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ (Unaudited) 
+ (Unaudited) 
+
+ 
+ Payments on behalf: 
+ 
+ 
+
+ 
+ Management fees 
+ US$- 
+ US$103,598 
+
+ 
+ Purchase of equipment, materials and services 
+ 212 
+ 4,157 
+
+ 
+ Rental for the shop and office 
+ 45,183 
+ - 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total 
+ US$45,395 
+ US$107,755 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ For
+ the years ended 
+
+ June 30
+
+ 
+
+ 
+ 
+ 
+ 2024
+ 
+ 
+ 2023
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Payments on behalf:
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Management fees
+ 
+ US$
+ 103,596
+ 
+ 
+ US$
+ 618,963
+ 
+
+ 
+ Purchase of equipment, materials and services
+ 
+ 
+ 4,157
+ 
+ 
+ 
+ 44,802
+ 
+
+ 
+ Rental for the executive
+ 
+ 
+ -
+ 
+ 
+ 
+ 18,756
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Total
+ 
+ US$
+ 107,753
+ 
+ 
+ US$
+ 682,521
+ 
+
+ 
+ 
+
+ 117
+
+ 
+
+ 
+
+ 
+
+c)
+Salaries and employee benefits paid to major shareholders
+
+ 
+
+As the executive director
+and CEO of our Company, Mr. Ng Hon Kin is entitled to the director s fee and remuneration.
+
+ 
+
+ 
+ 
+ For
+ the eleven months ended
+
+ May 31,
+ 
+
+ 
+ 
+ 2025 
+
+ 
+ 
+ USD 
+
+ 
+ 
+ (Unaudited) 
+
+ 
+ Mr. Ng Hon Kin (being paid by an associated company) 
+ $14,838 
+
+ 
+ Total 
+ $14,838 
+
+ 
+
+ 
+
+ 
+ 
+ For
+ the six months ended
+
+ December
+ 31,
+ 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ 
+ (Unaudited) 
+ (Unaudited)
+ 
+
+ 
+ Mr. Ng Hon Kin (being paid by an associated company) 
+ US$8,091 
+ US$5,372 
+
+ 
+ Total 
+ US$8,091 
+ US$5,372 
+
+ 
+
+ 
+
+ 
+ 
+ For the
+ years ended
+
+ June
+ 30,
+ 
+
+ 
+ 
+ 2024 
+ 2023 
+
+ 
+ Mr. Ng Hon Kin (being paid by an associated company) 
+ US$15,385 
+ US$15,385 
+
+ 
+ Total 
+ US$15,385 
+ US$15,385 
+
+ 
+
+ 
+
+d) Issuance of Ordinary
+Shares pursuant in relation to promissory notes 
+
+ 
+
+During March 2023 to October
+2023, Mr. Ng Hon Kin issued various promissory notes to seven individuals, for borrowing $1,038,000 in the aggregate, which were intended
+to be used for financing this initial public offering and general operational needs. Pursuant to the promissory notes, our Controlling
+Shareholder had the option to repay the borrowings in the form of shares representing equity interests in the Group. The seven promissory
+notes described above were cancelled on March 28, 2024. In consideration thereof, our Controlling Shareholder caused the Company to issue
+Ordinary Shares to the entities designated by the noteholders at an issue price per share $0.0001.
+
+ 
+
+DESCRIPTION
+OF SHARE CAPITAL
+
+ 
+
+A
+copy of our Amended and Restated Memorandum and Articles is filed as an exhibit to our registration statement of which this prospectus
+is a part.
+
+ 
+
+We
+are an exempted company incorporated with limited liability in the Cayman Islands and our affairs are governed by our memorandum and
+articles of association, as amended from time to time, the Companies Act and the common law of the Cayman Islands.
+
+ 
+
+As
+of the date of this prospectus, our authorized share capital is US$11,000 divided into 85,000,000 Class A Ordinary Shares and 25,000,000
+Class B Ordinary Shares of par value of US$0.0001 each.
+
+ 
+
+The
+following description of our share capital and provisions of our Amended and Restated Memorandum and Articles are summaries only and
+do not purport to be complete.
+
+ 
+
+Ordinary
+Shares
+
+ 
+
+General
+
+ 
+
+All
+of our outstanding Ordinary Shares are non-assessable. Our Ordinary Shares are issued in registered form, and are issued when registered
+in our register of members. Unless the board of directors determine otherwise, each holder of our Ordinary Shares will not receive a
+certificate in respect of such Ordinary Shares. Our shareholders who are non-residents of the Cayman Islands may freely hold and vote
+their Ordinary Shares. We may not issue shares to bearer.
+
+ 
+
+Subject
+to the provisions of the Companies Act and our Amended and Restated Memorandum and Articles regarding redemption and purchase of the
+shares, the directors have general and unconditional authority to allot (with or without confirming rights of renunciation), grant options
+over or otherwise deal with any unissued shares to such persons, at such times and on such terms and conditions as they may decide. The
+directors may deal with unissued shares either at a premium or at par, or with or without preferred, deferred or other special rights
+or restrictions, whether in regard to dividend, voting, return of capital or otherwise. No share may be issued at a discount except in
+accordance with the provisions of the Companies Act.
+
+ 
+
+Dividends
+
+ 
+
+Subject
+to the Companies Act and any rights attaching to any class or classes of shares under and in accordance with the Amended and Restated
+Memorandum and Articles:
+
+ 
+
+ 
+ (i)
+ the
+ directors may declare dividends or distributions out of our funds which are lawfully available for that purpose; and
+
+ 
+ 
+ 
+
+ 
+ (ii)
+ our
+ shareholders may, by ordinary resolution, declare dividends but no such dividend shall exceed the amount recommended by the directors.
+
+ 
+ 
+
+ 118
+
+ 
+
+ 
+
+ 
+
+Subject
+to the requirements of the Companies Act regarding the application of a company s share premium account and with the sanction of
+an ordinary resolution, dividends may also be declared and paid out of any share premium account. The directors when paying dividends
+to shareholders may make such payment either in cash or in specie. Unless provided by the rights attached to a share, no dividend shall
+bear interest.
+
+ 
+
+Voting
+Rights
+
+ 
+
+Subject
+to any rights or restrictions as to voting attached to any shares, unless any share carries special voting rights, every shareholder
+who is present in person and every person representing a shareholder by proxy shall have one vote per share. A resolution put to the
+vote of a meeting shall be decided on a poll. Unless otherwise required by the Companies Act, the Amended and Restated Memorandum and
+Articles, holders of Class A Ordinary Shares (which has a single vote per Class A Ordinary Share) and Class B Ordinary Shares (which
+has twenty votes per Class B Ordinary Share), shall, at all times, vote together on all matters submitted to a vote for shareholders 
+approval. In addition, all shareholders holding shares of a particular class are entitled to vote at a meeting of the holders of that
+class of shares. Votes may be given either personally or by proxy.
+
+ 
+
+Transfer
+of Ordinary Shares
+
+ 
+
+Subject
+to any applicable requirements set forth in the Amended and Restated Memorandum and Articles and provided that a transfer of Ordinary
+Shares complies with applicable rules of the Nasdaq Capital Market, a shareholder may transfer Ordinary Shares to another person by completing
+an instrument of transfer in a common form or in a form prescribed by Nasdaq or in any other form approved by the directors, executed:
+
+ 
+
+ 
+ 
+ 
+ 
+ where
+ the Ordinary Shares are fully paid, by or on behalf of that shareholder; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ where
+ the Ordinary Shares are partly paid, by or on behalf of that shareholder and the transferee.
+
+ 
+ 
+
+The
+transferor shall be deemed to remain the holder of an Ordinary Share until the name of the transferee is entered into our register of
+members.
+
+ 
+
+Where
+the Ordinary Shares in question are not listed on or subject to the rules of the Nasdaq Capital Market, our board of directors may, in
+its absolute discretion, decline to register any transfer of any Ordinary Share that has not been fully paid up or is subject to a company
+lien. Our board of directors may also decline to register any transfer of such Ordinary Share unless:
+
+ 
+
+ 
+ 
+ 
+ 
+ the
+ instrument of transfer is lodged with us, accompanied by the certificate for the Ordinary Shares to which it relates and such other
+ evidence as our board of directors may reasonably require to show the right of the transferor to make the transfer;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ the
+ instrument of transfer is in respect of only one class of shares;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ the
+ instrument of transfer is properly stamped, if required;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ the
+ Ordinary Share transferred is fully paid and free of any lien in favor of us;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ any
+ fee related to the transfer has been paid to us; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ the
+ transfer is not more than four joint holders.
+
+ 
+ 
+
+If
+our directors refuse to register a transfer, they are required, within one months after the date on which the instrument of transfer
+was lodged, to send to each of the transferor and the transferee notice of such refusal.
+
+ 
+
+The
+registration of transfers may, on 14 clear days notice being given by advertisement in such one or more newspapers or by electronic
+means, be suspended and our register of members closed at such times and for such periods as our board of directors may, in their absolute
+discretion, from time to time determine. The registration of transfers, however, may not be suspended, and the register may not be closed,
+for more than 30 clear days in any year.
+
+ 
+
+ 119
+
+ 
+
+ 
+
+ 
+
+Liquidation
+Rights
+
+ 
+
+If
+we are wound up, the shareholders may, subject to the Amended and Restated Memorandum and Articles and any other sanction required by
+the Companies Act, pass a special resolution allowing the liquidator to do either or both of the following:
+
+ 
+
+ 
+ 
+ 
+ 
+ to
+ divide in specie among the shareholders the whole or any part of our assets and, for that purpose, to value any assets and to determine
+ how the division shall be carried out as between the shareholders or different classes of shareholders; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ to
+ vest the whole or any part of the assets in trustees for the benefit of shareholders and those liable to contribute to the winding
+ up.
+
+ 
+ 
+
+The
+directors have the authority to present a petition for our winding up to the Grand Court of the Cayman Islands on our behalf without
+the sanction of a resolution passed at a general meeting.
+
+ 
+
+Calls
+on Ordinary Shares and Forfeiture of Ordinary Shares
+
+ 
+
+Subject
+to the terms of allotment, the directors may make calls on the shareholders in respect of any monies unpaid on their shares including
+any premium and each shareholder shall (subject to receiving at least 14 clear days notice specifying when and where payment is
+to be made), pay to us the amount called on his shares. Shareholders registered as the joint holders of a share shall be jointly and
+severally liable to pay all calls in respect of the share. If a call remains unpaid after it has become due and payable the person from
+whom it is due and payable shall pay interest on the amount unpaid from the day it became due and payable until it is paid at the rate
+fixed by the terms of allotment of the share or in the notice of the call or if no rate is fixed, at the rate of ten percent per annum.
+The directors may waive payment of the interest wholly or in part.
+
+ 
+
+We
+have a first and paramount lien on all shares (whether fully paid up or not) registered in the name of a shareholder (whether solely
+or jointly with others). The lien is for all monies payable to us by the shareholder or the shareholder s estate:
+
+ 
+
+ 
+ 
+ 
+ 
+ either
+ alone or jointly with any other person, whether or not that other person is a shareholder; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ whether
+ or not those monies are presently payable.
+
+ 
+ 
+
+At
+any time the directors may declare any share to be wholly or partly exempt from the lien on shares provisions of the Amended and Restated
+Articles.
+
+ 
+
+We
+may sell, in such manner as the directors may determine, any share on which the sum in respect of which the lien exists is presently
+payable, if due notice that such sum is payable has been given (as prescribed by the Amended and Restated Memorandum and Articles) and,
+within 14 clear days of the date on which the notice is deemed to be given under the Amended and Restated Memorandum and Articles, such
+notice has not been complied with.
+
+ 
+
+Redemption
+of Ordinary Shares
+
+ 
+
+Subject
+to the Companies Act and any rights for the time being conferred on the shareholders holding a particular class of shares, we may by
+action of our directors:
+
+ 
+
+ 
+ 
+ 
+ 
+ issue
+ shares that are to be redeemed or liable to be redeemed, at our option or the shareholder holding those redeemable shares, on the
+ terms and in the manner our directors determine before the issue of those shares;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ with
+ the consent by special resolution of the shareholders holding shares of a particular class, vary the rights attaching to that class
+ of shares so as to provide that those shares are to be redeemed or are liable to be redeemed at our option on the terms and in the
+ manner which the directors determine at the time of such variation; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ purchase
+ all or any of our own shares of any class including any redeemable shares on the terms and in the manner which the directors determine
+ at the time of such purchase.
+
+ 
+ 
+
+We
+may make a payment in respect of the redemption or purchase of its own shares in any manner authorized by the Companies Act, including
+out of any combination of capital, our profits and the proceeds of a fresh issue of shares.
+
+ 
+
+When
+making a payment in respect of the redemption or purchase of shares, the directors may make the payment in cash or in specie (or partly
+in one and partly in the other) if so authorized by the terms of the allotment of those shares or by the terms applying to those shares,
+or otherwise by agreement with the shareholder holding those shares.
+
+ 
+
+ 120
+
+ 
+
+ 
+
+ 
+
+Variations
+of Rights of Shares
+
+ 
+
+Whenever
+our capital is divided into different classes of shares, the rights attaching to any class of share (unless otherwise provided by the
+terms of issue of the shares of that class) may be varied either with the consent in writing of the holders of not less than two-thirds
+of the issued shares of that class, or with the sanction of a resolution passed by a majority of not less than two-thirds of the holders
+of shares of the class present in person or by proxy at a separate general meeting of the holders of shares of that class.
+
+ 
+
+Unless
+the terms on which a class of shares was issued state otherwise, the rights conferred on the shareholder holding shares of any class
+shall not be deemed to be varied by the creation or issue of further shares ranking pari passu with the existing shares of that class.
+
+ 
+
+General
+Meetings of Shareholders
+
+ 
+
+As
+a Cayman Islands exempted company, we are not obligated by the Companies Act to call shareholders annual general meetings; accordingly,
+we may, but shall not be obliged to, in each year hold a general meeting as an annual general meeting. Any annual general meeting held
+shall be held at such time and place as may be determined by our board of directors. All general meetings other than annual general meetings
+shall be called extraordinary general meetings.
+
+ 
+
+The
+directors may convene general meetings whenever they think fit. General meetings shall also be convened on the written requisition of
+one or more of the shareholders entitled to attend and vote at our general meetings who (together) hold at least ten percent of the rights
+to vote at such general meeting in accordance with the notice provisions in the articles, specifying the purpose of the meeting and signed
+by each of the shareholders making the requisition. If the directors do not convene such meeting within 21 clear days from the
+date of receipt of the written requisition, those shareholders who requested the meeting or any of them may convene the general meeting
+themselves within three months after the end of such period of 21 clear days in which case reasonable expenses incurred by them as a
+result of the directors failing to convene a meeting shall be reimbursed by us.
+
+ 
+
+At
+least 5 clear days notice of a general meeting shall be given to shareholders entitled to attend and vote at such meeting. The
+notice shall specify the place, the day and the hour of the meeting and the general nature of that business. In addition, if a resolution
+is proposed as a special resolution, the text of that resolution shall be given to all shareholders. Notice of every general meeting
+shall also be given to the directors and our auditors.
+
+ 
+
+Subject
+to the Companies Act and with the consent of the shareholders who, individually or collectively, hold at least 90 percent of the voting
+rights of all those who have a right to vote at a general meeting, a general meeting may be convened on shorter notice.
+
+ 
+
+A
+quorum shall consist of the presence (whether in person or represented by proxy) of one or more shareholders holding shares that represent
+not less than one-third of the outstanding shares carrying the right to vote at such general meeting.
+
+ 
+
+If,
+within 15 minutes from the time appointed for the general meeting, or at any time during the meeting, a quorum is not present, the meeting,
+if convened upon the requisition of shareholders, shall be cancelled. In any other case it shall stand adjourned to the same time and
+place seven days or to such other time or place as is determined by the directors.
+
+ 
+
+The
+chairman may, with the consent of a meeting at which a quorum is present, adjourn the meeting. When a meeting is adjourned for more than
+seven clear days, notice of the adjourned meeting shall be given in accordance with the Amended and Restated Memorandum and Articles.
+
+ 
+
+At
+any general meeting a resolution put to the vote of the meeting shall be decided on a poll. A poll shall be taken in such manner
+as the chairman directs and the result of the poll shall be deemed to be the resolution of the meeting.
+
+ 
+
+In
+the case of an equality of votes, the chairman of the meeting may choose to exercise a second or casting vote.
+
+ 
+
+ 121
+
+ 
+
+ 
+
+ 
+
+Inspection
+of Books and Records
+
+ 
+
+Holders
+of our Ordinary Shares will have no general right under the Companies Act to inspect or obtain copies of our register of members or our
+corporate records (except for the memorandum and articles of association of our company, any special resolutions passed by our company
+and the register of mortgages and charges of our company).
+
+ 
+
+Changes
+in Capital
+
+ 
+
+Subject
+to the Companies Act, our shareholders may, by ordinary resolution:
+
+ 
+
+ 
+ (a)
+ increase
+ our share capital by new shares of the amount fixed by that ordinary resolution and with the attached rights, priorities and privileges
+ set out in that ordinary resolution;
+
+ 
+ 
+ 
+
+ 
+ (b)
+ consolidate
+ and divide all or any of our share capital into shares of a larger amount than our existing shares;
+
+ 
+ 
+ 
+
+ 
+ (c)
+ sub-divide
+ our shares or any of them into shares of a smaller amount than that fixed so, however, that in the subdivision the proportion between
+ the amount paid and the amount, if any, unpaid on each reduced shares shall be the same as it was in case of the share from which
+ the reduced share is derived;
+
+ 
+ 
+ 
+
+ 
+ (d)
+ cancel
+ any shares which, at the date of the passing of that ordinary resolution, have not been taken or agreed to be taken by any person
+ and diminish the amount of our share capital by the amount of the shares so cancelled or, in the case of shares without nominal par
+ value, diminish the number of shares into which our capital is divided; and
+
+ 
+ 
+ 
+
+ 
+ (e)
+ convert
+ all or any of our paid-up shares into stock and reconvert that stock into paid-up shares of any denomination.
+
+ 
+ 
+
+Subject
+to the Companies Act and to any rights for the time being conferred on the shareholders holding a particular class of shares, our shareholders
+may, by special resolution, reduce its share capital in any way.
+
+ 
+
+CERTAIN
+CAYMAN ISLANDS COMPANY CONSIDERATIONS
+
+ 
+
+Exempted
+Company
+
+ 
+
+We
+are an exempted company with limited liability under the Companies Act. The Companies Act distinguishes between ordinary resident companies
+and exempted companies. Any company that is registered in the Cayman Islands but conducts business mainly outside of the Cayman Islands
+may apply to be registered as an exempted company. The requirements for an exempted company are essentially the same as for an ordinary
+company except for the exemptions and privileges listed below:
+
+ 
+
+A
+Cayman Islands exempted company:
+
+ 
+
+ 
+ 
+ 
+ is
+ a company that conducts its business mainly outside the Cayman Islands;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ is
+ prohibited from trading in the Cayman Islands with any person, firm or corporation except in furtherance of the business of the exempted
+ company carried on outside the Cayman Islands (and for this purpose can effect and conclude contracts in the Cayman Islands and exercise
+ in the Cayman Islands all of its powers necessary for the carrying on of its business outside the Cayman Islands);
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ does
+ not have to hold an annual general meeting;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ does
+ not have to make its register of members open to inspection by shareholders of that company;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ may
+ obtain an undertaking against the imposition of any future taxation;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ may
+ register by way of continuation in another jurisdiction and be deregistered in the Cayman Islands;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ may
+ register as an exempted limited duration company; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ may
+ register as a segregated portfolio company.
+
+ 
+ 
+
+"Limited
+liability" means that the liability of each shareholder is limited to the amount unpaid by the shareholder on the shares of the
+company.
+
+ 
+
+ 122
+
+ 
+
+ 
+
+ 
+
+Comparison
+of Cayman Islands Corporate Law and U.S. Corporate Law
+
+ 
+
+The
+Companies Act is derived, to a large extent, from the older Companies Acts of England and Wales but does not follow recent United Kingdom
+statutory enactments, and accordingly there are significant differences between the Cayman Islands Companies Act and the current Companies
+Act of the United Kingdom. In addition, the Companies Act differs from laws applicable to United States corporations and their shareholders.
+Set forth below is a summary of the significant differences between the provisions of the Companies Act applicable to us and the laws
+applicable to companies incorporated in the State of Delaware.
+
+ 
+
+This
+discussion does not purport to be a complete statement of the rights of holders of our Ordinary Shares under applicable law in the Cayman
+Islands or the rights of holders of the common stock of a typical corporation under applicable Delaware law.
+
+ 
+
+Mergers
+and Similar Arrangements
+
+ 
+
+The
+Companies Act permits mergers and consolidations between Cayman Islands companies and between Cayman Islands companies and non-Cayman
+Islands companies. For these purposes, (a) "merger" means the merging of two or more constituent companies and the vesting
+of their undertaking, property, and liabilities in one of such companies as the surviving company, and (b) a "consolidation"
+means the combination of two or more constituent companies into a consolidated company and the vesting of the undertaking, property and
+liabilities of such companies to the consolidated company. In order to effect such a merger or consolidation, the directors of each constituent
+company must approve a written plan of merger or consolidation, which must then be authorized by (a) a special resolution of the shareholders
+of each constituent company, and (b) such other authorization, if any, as may be specified in such constituent company s articles
+of association. The plan must be filed with the Registrar of Companies of the Cayman Islands together with a declaration as to the solvency
+of the consolidated or surviving company, a statement setting out the assets and liabilities of each constituent company and an undertaking
+that a copy of the certificate of merger or consolidation will be given to the members and creditors of each constituent company and
+that notification of the merger or consolidation will be published in the Cayman Islands Gazette. Court approval is not required for
+a merger or consolidation which is effected in compliance with these statutory procedures.
+
+ 
+
+A
+merger between a Cayman Islands parent company and its Cayman subsidiary or subsidiaries does not require authorization by a resolution
+of shareholders. For this purpose, a subsidiary is a company of which at least ninety percent (90%) of the issued shares entitled to
+vote are owned by the parent company.
+
+ 
+
+The
+consent of each holder of a fixed or floating security interest over a constituent company is required unless this requirement is waived
+by a court in the Cayman Islands.
+
+ 
+
+Save
+in certain circumstances, a dissentient shareholder of a Cayman constituent company is entitled to payment of the fair value of his shares
+upon dissenting to a merger or consolidation. The exercise of such dissenter rights will preclude the exercise by the dissenting shareholder
+of any other rights to which he or she might otherwise be entitled by virtue of holding shares, except for the right to seek relief on
+the grounds that the merger or consolidation is void or unlawful.
+
+ 
+
+In
+addition, there are statutory provisions that facilitate the reconstruction and amalgamation of companies, provided that the arrangement
+is approved by seventy-five percent (75%) in value of the shareholders or class of shareholders, as the case may be, that are present
+and voting either in person or by proxy at a meeting, or meetings, convened for that purpose. The convening of the meetings and subsequently
+the arrangement must be sanctioned by the Grand Court of the Cayman Islands. While a dissenting shareholder has the right to express
+to the court the view that the transaction ought not to be approved, the court can be expected to approve the arrangement if it determines
+that:
+
+ 
+
+ 
+
+ 
+ 
+ 
+ the
+ statutory provisions as to the required majority vote have been met;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ shareholders have been fairly represented at the meeting in question and the statutory majority are acting bona fide without coercion
+ of the minority to promote interests adverse to those of the class;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ arrangement is such that may be reasonably approved by an intelligent and honest man of that class acting in respect of his interest;
+ and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ arrangement is not one that would more properly be sanctioned under some other provision of the Companies Act.
+
+ 
+ 
+
+When
+a takeover offer is made and accepted by holders of 90% of the shares affected within four months the offeror may, within a two-month
+period commencing on the expiration of such four-month period, require the holders of the remaining shares to transfer such shares on
+the terms of the offer. An objection can be made to the Grand Court of the Cayman Islands but this is unlikely to succeed in the case
+of an offer which has been so approved unless there is evidence of fraud, bad faith or collusion.
+
+ 
+
+If
+an arrangement and reconstruction is thus approved, or if a takeover offer is made and accepted, a dissenting shareholder would have
+no rights comparable to appraisal rights, which would otherwise ordinarily be available to dissenting shareholders of Delaware corporations,
+providing rights to receive payment in cash for the judicially determined value of the shares.
+
+ 
+
+ 123
+
+ 
+
+ 
+
+ 
+
+Shareholders 
+Suits
+
+ 
+
+In
+principle, we will normally be the proper plaintiff to sue for a wrong done to us as a company and as a general rule, a derivative action
+may not be brought by a minority shareholder. However, based on English law authorities, which would in all likelihood be of persuasive
+authority in the Cayman Islands, the Cayman Islands court can be expected to follow and apply the common law principles (namely the rule
+in Foss v. Harbottle and the exceptions thereto) so that a non-controlling shareholder may be permitted to commence a class action against
+or derivative actions in the name of the company to challenge:
+
+ 
+
+ 
+ 
+ 
+ an
+ act which is illegal or ultra vires with respect to the company and is therefore incapable of ratification by the shareholders;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an
+ act which, although not ultra vires, requires authorization by a qualified (or special) majority (that is, more than a simple majority)
+ which has not been obtained; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an
+ act which constitutes a "fraud on the minority" where the wrongdoers are themselves in control of the company.
+
+ 
+ 
+
+Indemnification
+of Directors and Executive Officers and Limitation of Liability
+
+ 
+
+Cayman
+Islands law does not limit the extent to which a company s memorandum and articles of association may provide for indemnification
+of officers and directors, except to the extent that any such provision may be held by the Cayman Islands courts to be contrary to public
+policy, such as to provide indemnification against the indemnified person s own fraud, dishonesty, willful default, or willful
+neglect or against the consequences of committing a crime, or against the indemnified person s own fraud or dishonesty. Our Amended
+and Restated Memorandum and Articles provide to the extent permitted by Cayman Islands law, we shall indemnify each existing or former
+secretary, director (including alternate director), and any of our other officers (including an investment adviser or an administrator
+or liquidator) and their personal representatives against:
+
+ 
+
+ 
+ 
+ (a)
+ all
+ actions, proceedings, costs, charges, expenses, losses, damages or liabilities incurred or sustained by the existing or former director
+ (including alternate director), secretary or officer in or about the conduct of our business or affairs or in the execution or discharge
+ of the existing or former director (including alternate director), secretary s or officer s duties, powers, authorities
+ or discretions; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ (b)
+ without
+ limitation to paragraph (a) above, all costs, expenses, losses or liabilities incurred by the existing or former director (including
+ alternate director), secretary or officer in defending (whether successfully or otherwise) any civil, criminal, administrative or
+ investigative proceedings (whether threatened, pending or completed) concerning us or our affairs in any court or tribunal, whether
+ in the Cayman Islands or elsewhere.
+
+ 
+ 
+
+No
+such existing or former director (including alternate director), secretary or officer, however, shall be indemnified in respect of any
+matter arising out of his own dishonesty, fraud, willful default or willful neglect.
+
+ 
+
+To
+the extent permitted by the Companies Act, we may make a payment, or agree to make a payment, whether by way of advance, loan or otherwise,
+for any legal costs incurred by an existing or former director (including alternate director), secretary or any of our officers in respect
+of any matter identified in above on condition that the director (including alternate director), secretary or officer must repay the
+amount paid by us to the extent that it is ultimately found not liable to indemnify the director (including alternate director), the
+secretary or that officer for those legal costs.
+
+ 
+
+This
+standard of conduct is generally the same as permitted under the Delaware General Corporation Act for a Delaware corporation. In addition,
+we intend to enter into indemnification agreements with our directors and senior executive officers that will provide such persons with
+additional indemnification beyond that provided in our Amended and Restated Memorandum and Articles. Insofar as indemnification for liabilities
+arising under the Securities Act may be permitted to our directors, officers or persons controlling us under the foregoing provisions,
+we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act
+and is therefore unenforceable.
+
+ 
+
+Directors 
+Fiduciary Duties
+
+ 
+
+Under
+Delaware corporate law, a director of a Delaware corporation has a fiduciary duty to the corporation and its shareholders. This duty
+has two components: the duty of care and the duty of loyalty. The duty of care requires that a director act in good faith, with the care
+that an ordinarily prudent person would exercise under similar circumstances. Under this duty, a director must inform himself of, and
+disclose to shareholders, all material information reasonably available regarding a significant transaction. The duty of loyalty requires
+that a director act in a manner he or she reasonably believes to be in the best interests of the corporation. He or she must not use
+his or her corporate position for personal gain or advantage. This duty prohibits self-dealing by a director and mandates that the best
+interest of the corporation and its shareholders take precedence over any interest possessed by a director, officer or controlling shareholder
+and not shared by the shareholders generally. In general, actions of a director are presumed to have been made on an informed basis,
+in good faith and in the honest belief that the action taken was in the best interests of the corporation. However, this presumption
+may be rebutted by evidence of a breach of one of the fiduciary duties. Should such evidence be presented concerning a transaction by
+a director, a director must prove the procedural fairness of the transaction, and that the transaction was of fair value to the corporation.
+
+ 
+
+ 124
+
+ 
+
+ 
+
+ 
+
+As
+a matter of Cayman Islands law, a director owes three types of duties to the company: (i) statutory duties, (ii) fiduciary duties, and
+(iii) common law duties. The Companies Act imposes a number of statutory duties on a director. A Cayman Islands director s fiduciary
+duties are not codified, however the courts of the Cayman Islands have held that a director owes the following fiduciary duties (a) a
+duty to act in what the director bona fide considers to be in the best interests of the company, (b) a duty to exercise their powers
+for the purposes they were conferred, (c) a duty to avoid fettering his or her discretion in the future and (d) a duty to avoid conflicts
+of interest and of duty. The common law duties owed by a director are those to act with skill, care and diligence that may reasonably
+be expected of a person carrying out the same functions as are carried out by that director in relation to the company and, also, to
+act with the skill, care and diligence in keeping with a standard of care commensurate with any particular skill they have which enables
+them to meet a higher standard than a director without those skills. In fulfilling their duty of care to us, our directors must ensure
+compliance with our Amended and Restated Memorandum and Articles, as amended and restated from time to time. We have the right to seek
+damages where certain duties owed by any of our directors are breached.
+
+ 
+
+Shareholder
+Action by Written Consent
+
+ 
+
+Under
+the Delaware General Corporation Act, a corporation may eliminate the right of shareholders to act by written consent by amendment to
+its certificate of incorporation. Our Amended and Restated Memorandum and Articles provide that any action required or permitted to be
+taken at general meetings of our Company may only be taken upon the vote of shareholders at general meeting, and shareholders may approve
+corporate matters by way of a unanimous written resolution without a meeting being held in the case of special resolution.
+
+ 
+
+Shareholder
+Proposals
+
+ 
+
+Under
+the Delaware General Corporation Act, a shareholder has the right to put any proposal before the annual meeting of shareholders, provided
+it complies with the notice provisions in the governing documents. A special meeting may be called by the board of directors, or any
+other person authorized to do so in the governing documents, but shareholders may be precluded from calling special meetings.
+
+ 
+
+The
+Companies Act does not provide shareholders with rights to requisition a general meeting nor any right to put any proposal before a general
+meeting. However, these rights may be provided in a company s articles of association. Our Amended and Restated Memorandum and
+Articles allow one or more of our shareholders who together hold at least 10% of the rights to vote to requisition a general meeting
+of our shareholders, in which case our board is obliged to call such meeting.
+
+ 
+
+Cumulative
+Voting
+
+ 
+
+Under
+the Delaware General Corporation Act, cumulative voting for elections of directors is not permitted unless the corporation s certificate
+of incorporation specifically provides for it. Cumulative voting potentially facilitates the representation of minority shareholders
+on a board of directors since it permits the minority shareholder to cast all the votes to which the shareholder is entitled on a single
+director, which increases the shareholder s voting power with respect to electing such director. There are no prohibitions in relation
+to cumulative voting under the Companies Act but our Amended and Restated Memorandum and Articles do not provide for cumulative voting.
+As a result, our shareholders are not afforded any less protections or rights on this issue than shareholders of a Delaware corporation.
+
+ 
+
+Removal
+of Directors
+
+ 
+
+Under
+the Delaware General Corporation Law, a director of a corporation with a classified board may be removed only for cause with the approval
+of a majority of the outstanding shares entitled to vote, unless the certificate of incorporation provides otherwise. Under our Amended
+and Restated Memorandum and Articles, directors may be removed by an ordinary resolution of our shareholders.
+
+ 
+
+Transactions
+with Interested Shareholders
+
+ 
+
+The
+Delaware General Corporation Act contains a business combination statute applicable to Delaware corporations whereby, unless the corporation
+has specifically elected not to be governed by such statute by amendment to its certificate of incorporation, it is prohibited from engaging
+in certain business combinations with an "interested shareholder" for three years following the date that such person becomes
+an interested shareholder. An interested shareholder generally is a person or a group who or which owns or owned 15% or more of the target s
+outstanding voting stock within the past three years. This has the effect of limiting the ability of a potential acquirer to make a two-tiered
+bid for the target in which all shareholders would not be treated equally. The statute does not apply if, among other things, prior to
+the date on which such shareholder becomes an interested shareholder, the board of directors approves either the business combination
+or the transaction which resulted in the person becoming an interested shareholder. This encourages any potential acquirer of a Delaware
+corporation to negotiate the terms of any acquisition transaction with the target s board of directors.
+
+ 
+
+Interested
+director transactions are governed by the terms of a company s memorandum and articles of association. A director may, subject
+to any separate requirement for audit committee approval under applicable law, the Amended and Restated Memorandum and Articles or the
+Nasdaq Stock Market Listing Rules, or disqualification by the chairman of the relevant board meeting, vote in respect of certain contract
+or transaction in which he or she is interested, provided that the nature of the interest of any directors in such contract or transaction
+is disclosed by him or her at or prior to its consideration and any vote in that matter.
+
+ 
+
+ 125
+
+ 
+
+ 
+
+ 
+
+Dissolution
+and Winding Up
+
+ 
+
+Under
+the Delaware General Corporation Act, unless the board of directors approves the proposal to dissolve, dissolution must be approved by
+shareholders holding 100% of the total voting power of the corporation. Only if the dissolution is initiated by the board of directors
+may it be approved by a simple majority of the corporation s outstanding shares. Delaware law allows a Delaware corporation to
+include in its certificate of incorporation a supermajority voting requirement in connection with dissolutions initiated by the board.
+
+ 
+
+Under
+Cayman Islands law, a company may be wound up by either an order of the courts of the Cayman Islands or by a special resolution of its
+members or, if the company is unable to pay its debts as they fall due, by an ordinary resolution of its members. The court has authority
+to order winding up in a number of specified circumstances including where it is, in the opinion of the court, just and equitable to
+do so. Under the Companies Act and our Amended and Restated Memorandum and Articles, our company may be dissolved, liquidated, or wound
+up by a special resolution of our shareholders.
+
+ 
+
+Variation
+of Rights of Shares
+
+ 
+
+Under
+the Delaware General Corporation Act, a corporation may vary the rights of a class of shares with the approval of a majority of the outstanding
+shares of such class, unless the certificate of incorporation provides otherwise. Under our Amended and Restated Memorandum and Articles,
+whenever our capital is divided into different classes of shares, the rights attaching to any class of share (unless otherwise provided
+by the terms of issue of the shares of that class) may be varied either with the consent in writing of the holders of not less than two-thirds
+of the issued shares of that class, or with the sanction of a resolution passed by a majority of not less than two-thirds of the holders
+of shares of the class present in person or by proxy at a separate general meeting of the holders of shares of that class.
+
+ 
+
+Unless
+the terms on which a class of shares was issued state otherwise, the rights conferred on the shareholder holding shares of any class
+shall not be deemed to be varied by the creation or issue of further shares ranking pari passu with the existing shares of that class.
+
+ 
+
+Amendment
+of Governing Documents
+
+ 
+
+Under
+the Delaware General Corporation Act, a corporation s governing documents may be amended with the approval of a majority of the
+outstanding shares entitled to vote, unless the certificate of incorporation provides otherwise. Under Cayman Islands law, our memorandum
+and articles of association may only be amended by a special resolution of our shareholders.
+
+ 
+
+Rights
+of Non-Resident or Foreign Shareholders
+
+ 
+
+There
+are no limitations imposed by our Amended and Restated Memorandum and Articles on the rights of non-resident or foreign shareholders
+to hold or exercise voting rights on our shares. In addition, there are no provisions in our Amended and Restated Memorandum and Articles
+governing the ownership threshold above which shareholder ownership must be disclosed.
+
+ 
+
+Anti-money
+Laundering — Cayman Islands
+
+ 
+
+In
+order to comply with legislation or regulations aimed at the prevention of money laundering, we are required to adopt and maintain anti-money
+laundering procedures and may require subscribers to provide evidence to verify their identity and source of funds. Where permitted,
+and subject to certain conditions, we may also delegate the maintenance of our anti-money laundering procedures (including the acquisition
+of due diligence information) to a suitable person.
+
+ 
+
+We
+reserve the right to request such information as is necessary to verify the identity of a subscriber. In some cases the directors may
+be satisfied that no further information is required since an exemption applies under the Anti-Money Laundering Regulations (Revised)
+of the Cayman Islands, as amended and revised from time to time (the "Regulations"). Depending on the circumstances of each
+application, a detailed verification of identity might not be required where:
+
+ 
+
+ 
+ 
+ 
+ 
+ the
+ subscriber makes the payment for their investment from an account held in the subscriber s name at a recognized financial institution;
+ or
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ the
+ subscriber is regulated by a recognized regulator and is based or incorporated in, or formed under the law of, a recognized jurisdiction;
+ or
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ the
+ application is made through an intermediary which is regulated by a recognized regulator and is based in or incorporated in, or formed
+ under the law of a recognized jurisdiction and an assurance is provided in relation to the procedures undertaken on the underlying
+ investors.
+
+ 
+ 
+
+For
+the purposes of these exceptions, recognition of a financial institution, regulator, or jurisdiction will be determined in accordance
+with the Regulations by reference to those jurisdictions recognized by the Cayman Islands Monetary Authority as having equivalent anti-money
+laundering regulations.
+
+ 
+
+ 126
+
+ 
+
+ 
+
+ 
+
+In
+the event of delay or failure on the part of the subscriber in producing any information required for verification purposes, we may refuse
+to accept the application, in which case any funds received will be returned without interest to the account from which they were originally
+debited.
+
+ 
+
+We
+also reserve the right to refuse to make any redemption payment to a shareholder if our directors or officers suspect or are advised
+that the payment of redemption proceeds to such shareholder might result in a breach of applicable anti-money laundering or other laws
+or regulations by any person in any relevant jurisdiction, or if such refusal is considered necessary or appropriate to ensure our compliance
+with any such laws or regulations in any applicable jurisdiction.
+
+ 
+
+If
+any person resident in the Cayman Islands knows or suspects or has reason for knowing or suspecting that another person is engaged in
+criminal conduct or is involved with terrorism or terrorist property and the information for that knowledge or suspicion came to their
+attention in the course of their business in the regulated sector, or other trade, profession, business or employment, the person will
+be required to report such knowledge or suspicion to (i) a nominated officer (appointed in accordance with the Proceeds of Crime Act
+(Revised) of the Cayman Islands) or the Financial Reporting Authority of the Cayman Islands, pursuant to the Proceeds of Crime Act (Revised),
+if the disclosure relates to criminal conduct or money laundering or (ii) to a police constable or a nominated officer (pursuant to the
+Terrorism Act (Revised) of the Cayman Islands) or the Financial Reporting Authority, pursuant to the Terrorism Act (Revised), if the
+disclosure relates to involvement with terrorism or terrorist financing and terrorist property. Such a report shall not be treated as
+a breach of confidence or of any restriction upon the disclosure of information imposed by any enactment or otherwise.
+
+ 
+
+Data
+Protection in the Cayman Islands — Privacy Notice
+
+ 
+
+This
+privacy notice explains the manner in which we collect, process, and maintain personal data about our investors pursuant the DPA.
+
+ 
+
+We
+are committed to processing personal data in accordance with the DPA. In our use of personal data, we will be characterized under the
+DPA as a "data controller," whilst certain of our service providers, affiliates, and delegates may act as "data processors"
+under the DPA. These service providers may process personal information for their own lawful purposes in connection with services provided
+to us.
+
+ 
+
+By
+virtue of your investment in our Company, we and certain of our service providers may collect, record, store, transfer, and otherwise
+process personal data by which individuals may be directly or indirectly identified.
+
+ 
+
+Your
+personal data will be processed fairly and for lawful purposes, including (a) where the processing is necessary for us to perform a contract
+to which you are a party or for taking pre-contractual steps at your request, (b) where the processing is necessary for compliance with
+any legal, tax, or regulatory obligation to which we are subject, or (c) where the processing is for the purposes of legitimate interests
+pursued by us or by a service provider to whom the data are disclosed. As a data controller, we will only use your personal data for
+the purposes for which we collected it. If we need to use your personal data for an unrelated purpose, we will contact you.
+
+ 
+
+We
+anticipate that we will share your personal data with our service providers for the purposes set out in this privacy notice. We may also
+share relevant personal data where it is lawful to do so and necessary to comply with our contractual obligations or your instructions
+or where it is necessary or desirable to do so in connection with any regulatory reporting obligations. In exceptional circumstances,
+we will share your personal data with regulatory, prosecuting, and other governmental agencies or departments, and parties to litigation
+(whether pending or threatened), in any country or territory including to any other person where we have a public or legal duty to do
+so (e.g. to assist with detecting and preventing fraud, tax evasion, and financial crime or compliance with a court order).
+
+ 
+
+Your
+personal data shall not be held by our Company for longer than necessary with regard to the purposes of the data processing.
+
+ 
+
+We
+will not sell your personal data. Any transfer of personal data outside of the Cayman Islands shall be in accordance with the requirements
+of the DPA. Where necessary, we will ensure that separate and appropriate legal agreements are put in place with the recipient of that
+data.
+
+ 
+
+We
+will only transfer personal data in accordance with the requirements of the DPA, and will apply appropriate technical and organizational
+information security measures designed to protect against unauthorized or unlawful processing of the personal data and against the accidental
+loss, destruction, or damage to the personal data.
+
+ 
+
+If
+you are a natural person, this will affect you directly. If you are a corporate investor (including, for these purposes, legal arrangements
+such as trusts or exempted limited partnerships) that provides us with personal data on individuals connected to you for any reason in
+relation to your investment into our Company, this will be relevant for those individuals and you should inform such individuals of the
+content.
+
+ 
+
+ 127
+
+ 
+
+ 
+
+ 
+
+You
+have certain rights under the DPA, including (a) the right to be informed as to how we collect and use your personal data (and this privacy
+notice fulfils our obligation in this respect), (b) the right to obtain a copy of your personal data, (c) the right to require us to
+stop direct marketing, (d) the right to have inaccurate or incomplete personal data corrected, (e) the right to withdraw your consent
+and require us to stop processing or restrict the processing, or not begin the processing of your personal data, (f) the right to be
+notified of a data breach (unless the breach is unlikely to be prejudicial), (g) the right to obtain information as to any countries
+or territories outside the Cayman Islands to which we, whether directly or indirectly, transfer, intend to transfer, or wish to transfer
+your personal data, general measures we take to ensure the security of personal data, and any information available to us as to the source
+of your personal data, (h) the right to complain to the Office of the Ombudsman of the Cayman Islands, and (i) the right to require us
+to delete your personal data in some limited circumstances.
+
+ 
+
+If
+you consider that your personal data has not been handled correctly, or you are not satisfied with our responses to any requests you
+have made regarding the use of your personal data, you have the right to complain to the Cayman Islands Ombudsman. The Ombudsman
+can be contacted by calling +1 (345) 946-6283 or by email at info@ombudsman.ky.
+
+ 
+
+Legislation
+of the Cayman Islands
+
+ 
+
+The
+Cayman Islands, together with several other non-European Union jurisdictions, have recently introduced legislation aimed at addressing
+concerns raised by the Council of the European Union as to offshore structures engaged in certain activities which attract profits without
+real economic activity. With effect from January 1, 2019, the International Tax Co-operation (Economic Substance) Act (Revised) (the
+"Substance Act") came into force in the Cayman Islands introducing certain economic substance requirements for in-scope Cayman
+Islands entities which are engaged in certain "relevant activities," which in the case of exempted companies incorporated
+before January 1, 2019, applies in respect of financial years commencing July 1, 2019, onwards. However, it is anticipated that our Company
+may remain out of scope of the legislation or else be subject to more limited substance requirements.
+
+ 
+
+SHARES
+ELIGIBLE FOR FUTURE SALE
+
+ 
+
+The registration
+statement of which this prospectus forms part also contains the Resale Prospectus. This prospectus relates to the initial public offering
+of the Ordinary Shares of the Company.
+
+ 
+
+Prior
+to this offering, we had 27,000,000 Ordinary Shares, consist of 9,450,000 Class A Ordinary Shares and 17,550,000 Class B Ordinary Shares,
+issued and outstanding. Upon completion of this offering, we will have 30,333,333 Ordinary Shares, consist of 12,783,333 Class A
+Ordinary Shares and 17,550,000 Class B Ordinary Shares, issued and outstanding, assuming the underwriters do not exercise their over-allotment
+option to purchase additional Ordinary Shares and 13,283,333 Class A Ordinary Shares outstanding if the over-allotment option is exercised
+in full, and 222,222 Class A Ordinary Shares of MCL will be converted from Class B Ordinary Shares and offered as Resale Shares. 
+
+ 
+
+All
+of the Ordinary Shares sold in this offering will be freely transferable by persons other than by our "affiliates" without
+restriction or further registration under the Securities Act. Sales of substantial amounts of our Ordinary Shares in the public market
+could adversely affect prevailing market prices of our Ordinary Shares. Rule 144 of the Securities Act defines an "affiliate"
+of a company as a person that, directly or indirectly, through one or more intermediaries, controls or is controlled by, or is under
+common control with, our Company. All of our Class A Ordinary Shares outstanding immediately prior to the completion of this offering
+are "restricted securities" as that term is defined in Rule 144 because they were issued in a transaction or series of transactions
+not involving a public offering. Restricted securities may be sold only if they are the subject of an effective registration statement
+under the Securities Act, or if they are sold pursuant to an exemption from the registration requirement of the Securities Act such as
+those provided for in Rules 144 promulgated under the Securities Act, which rule is summarized below. Restricted shares may also be sold
+outside of the United States to non-U.S. persons in accordance with Rule 904 of Regulation S under the Securities Act. This prospectus
+may not be used in connection with any resale of our Class A Ordinary Shares acquired in this offering by our affiliates.
+
+ 
+
+Sales
+of substantial amounts of our Class A Ordinary Shares in the public market could adversely affect the prevailing market prices of our
+Class A Ordinary Shares. We have applied for listing on the Nasdaq Capital Market under the symbol "MEDG" for the Ordinary
+Shares we are offering. The initial public offering price will be US$4.50 per Class A Ordinary Share. We have not been approved for
+listing on the Nasdaq Capital Market. Management believes that we currently meet the Nasdaq Capital Market s quantitative listing
+requirements and believe that upon the completion of the offering, we will meet the standards for listing on the Nasdaq Capital Market
+although we cannot assure you that a regular trading market will develop in the Class A Ordinary Shares.
+
+ 
+
+Lock-Up
+Agreements
+
+ 
+
+Our
+directors, executive officers, and shareholders owning more than 1% of our Ordinary Shares have agreed, subject to certain
+exceptions, including the resale of a portion of our Class A Ordinary Shares by the Selling Shareholders under the Resale Prospectus
+(whom have agreed not to sell the Resale Shares for a period of 21 days from the completion of the initial public offering), for a period
+of 180 days after the date of this prospectus, not to offer, sell or otherwise transfer or dispose of, directly or indirectly, any Class
+A Ordinary Shares of the Company or any securities convertible into or exercisable or exchangeable for Class A Ordinary Shares of the
+Company.
+
+ 
+
+ 128
+
+ 
+
+ 
+
+ 
+
+In
+addition, the Company has further agreed for a period of 365 days after the date of this prospectus, not to, except in connection
+with this offering, offer, sell or otherwise transfer or dispose of, directly or indirectly, any Class A Ordinary Shares or any securities
+convertible into or exercisable or exchangeable for Class A Ordinary Shares, or file or cause to be filed any registration statement
+with the SEC relating to the offering of any Ordinary Shares or any securities convertible into or exercisable or exchangeable for Ordinary
+Shares, other than post-effective amendments to the registration statement with respect to the Resale Prospectus. See "Underwriting
+- Lock-Up Agreements".
+
+ 
+
+We
+cannot predict what effect, if any, future sales of our Class A Ordinary Shares, or the availability of Class A Ordinary Shares for future
+sale, will have on the trading price of our Class A Ordinary Shares from time to time. Sales of substantial amounts of our Class A Ordinary
+Shares in the public market, or the perception that these sales could occur, could adversely affect the trading price of our Class A
+Ordinary Shares.
+
+ 
+
+Rule
+144
+
+ 
+
+In
+general, under Rule 144 as currently in effect, once we have been subject to the public company reporting requirements of Section 13
+or Section 15(d) of the Exchange Act for at least 90 days, persons who are not our affiliates and have beneficially owned our Class A
+Ordinary Shares for more than six months but not more than one year may sell such Class A Ordinary Shares without registration under
+the Securities Act subject to the availability of current public information about us. Persons who are not our affiliates and have beneficially
+owned our Class A Ordinary Shares for more than one year may freely sell our Class A Ordinary Shares without registration under the Securities
+Act. Persons who are our affiliates (including persons beneficially owning 10% or more of our outstanding shares), and have beneficially
+owned our Class A Ordinary Shares for at least six months, may sell within any three-month period a number of restricted securities that
+does not exceed the greater of the following:
+
+ 
+
+ 
+ 
+ 
+ 1.0%
+ of the then outstanding Class A Ordinary Shares; or
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ average weekly trading volume of our Class A Ordinary Shares during the four calendar weeks preceding the date on which notice of
+ the sale on Form 144 is filed with the SEC by such person.
+
+ 
+ 
+
+Such
+sales are also subject to manner-of-sale provisions, notice requirements and the availability of current public information about us.
+In addition, in each case, these shares would remain subject to any applicable lock-up arrangements and would only become eligible for
+sale when the lock-up period expires.
+
+ 
+
+EXPENSES
+RELATED TO THIS OFFERING
+
+ 
+
+Set
+forth below is an itemization of the total expenses, excluding underwriting discounts, which are expected to be incurred by us in connection
+with the offer and sale of the Ordinary Shares by us. With the exception of the SEC registration fee, the Financial Industry Regulatory
+Authority ("FINRA") filing fee and the Nasdaq market entry and listing fee, all amounts are estimates.
+
+ 
+
+ 
+ 
+ 
+ US$
+ 
+
+ 
+ SEC
+ registration fee
+ 
+ 
+ 10,000
+
+ 
+
+ 
+ FINRA
+ filing fee
+ 
+ 
+ 10,000
+
+ 
+
+ 
+ Nasdaq
+ market entry and listing fee
+ 
+ 
+ 75,000
+ 
+
+ 
+ Printing
+ and engraving expenses
+ 
+ 
+ 14,000
+
+ 
+
+ 
+ Legal
+ fees and expenses, including underwriters counsel
+ 
+ 
+ 561,538
+
+ 
+
+ 
+ Underwriters 
+ expenses
+ 
+ 
+ 340,000
+
+ 
+
+ 
+ Advisory
+ fee – TopX Consultancy Limited
+ 
+ 
+ 400,000
+ 
+
+ 
+ Miscellaneous
+ 
+ 
+ 70,000
+
+ 
+
+ 
+ Total
+ 
+ 
+ 1,480,538
+
+ 
+
+ 
+ 
+
+These
+expenses will be borne by us.
+
+ 
+
+ 129
+
+ 
+
+ 
+
+ 
+
+MATERIAL
+TAX CONSIDERATIONS
+
+ 
+
+The
+following summary of certain Cayman Islands and U.S. federal income tax consequences of an investment in our Ordinary Shares is based
+upon laws and relevant interpretations thereof in effect as of the date of this prospectus, all of which are subject to change. This
+summary does not deal with all possible tax consequences relating to an investment in the Ordinary Shares, such as the tax consequences
+under U.S. state and local tax laws or under the tax laws of jurisdictions other than the Cayman Islands and the United States. You are
+encouraged to consult your own tax advisors concerning the overall tax consequences arising in your own particular situation under U.S.
+federal, state, local or foreign law of the ownership of our Ordinary Shares. To the extent that this discussion relates to matters of
+Cayman Islands tax law, it is the opinion of Ogier, our counsel as to Cayman Islands law.
+
+ 
+
+Cayman
+Islands Tax Considerations
+
+ 
+
+The
+Cayman Islands currently levies no taxes on individuals or corporations based upon profits, income, gains or appreciation, and there
+is no taxation in the nature of inheritance tax or estate duty. There are no other taxes likely to be material to our Company levied
+by the Government of the Cayman Islands save for certain stamp duties which may be applicable on instruments executed in, or, after execution,
+brought within the jurisdiction of the Cayman Islands. The Cayman Islands is a party to a double tax treaty entered with the United Kingdom
+in 2010 but is otherwise not party to any double tax treaties that are applicable to any payments made to or by our company. There are
+no exchange control regulations or currency restrictions in the Cayman Islands.
+
+ 
+
+Payments
+of dividends and capital in respect of our Ordinary Shares will not be subject to taxation in the Cayman Islands and no withholding will
+be required on the payment of a dividend or capital to any holder of our Ordinary Shares, as the case may be, nor will gains derived
+from the disposal of our Ordinary Shares be subject to Cayman Islands income or corporation tax.
+
+ 
+
+The
+Cayman Islands enacted the Substance Act together with the Guidance Notes published by the Cayman Islands Tax Information Authority from
+time to time. The Company is required to comply with the economic substance requirements from July 1, 2019 and make an annual report
+in the Cayman Islands as to whether or not it is carrying on any relevant activities and if it is, it must satisfy an economic substance
+test.
+
+ 
+
+United
+States Federal Income Tax Considerations
+
+ 
+
+The
+following discussion is a summary of U.S. federal income tax considerations generally applicable to the ownership and disposition of
+our Class A Ordinary Shares by U.S. Holders (as defined below) that acquire our Ordinary Shares in this offering and hold our Class A
+Ordinary Shares as "capital assets" (generally, property held for investment) under the United States Internal Revenue Code
+of 1986, as amended (the "Code"). This discussion is based upon existing United States federal income tax law, which is subject
+to differing interpretations or change, possibly with retroactive effect. There can be no assurance that the Internal Revenue Service,
+or the IRS, or a court will not take a contrary position. This discussion does not address all aspects of United States federal income
+taxation that may be relevant to particular investors in light of their specific circumstances, including investors subject to special
+tax rules (for example, certain financial institutions (including banks), cooperatives, pension plans, insurance companies, broker-dealers,
+traders in securities that have elected the mark-to-market method of accounting for their securities, partnerships and their partners,
+regulated investment companies, real estate investment trusts and tax-exempt organizations (including private foundations)), investors
+who are not U.S. Holders, investors who own (directly, indirectly, or constructively) 10% or more of our stock (by vote or value), investors
+that will hold their Class A Ordinary Shares as part of a straddle, hedge, conversion, constructive sale, or other integrated transaction
+for United States federal income tax purposes or U.S. Holders that have a functional currency other than the U.S. dollar, all of whom
+may be subject to tax rules that differ significantly from those summarized below. In addition, this discussion does not discuss any
+non-United States tax, state or local tax, or non-income tax (such as the U.S. federal gift or estate tax) considerations, or any consequences
+under the alternative minimum tax or Medicare tax on net investment income. Each U.S. Holder is urged to consult its tax advisor regarding
+the United States federal, state, local, and non-United States income and other tax considerations of an investment in our Class A Ordinary
+Shares.
+
+ 
+
+General
+
+ 
+
+For
+purposes of this discussion, a "U.S. Holder" is a beneficial owner of our Class A Ordinary Shares that is, for United States
+federal income tax purposes, (i) an individual who is a citizen or resident of the United States, (ii) a corporation (or other entity
+treated as a corporation for United States federal income tax purposes) created in, or organized under the laws of, the United States
+or any state thereof or the District of Columbia, (iii) an estate the income of which is includible in gross income for United States
+federal income tax purposes regardless of its source, or (iv) a trust (A) the administration of which is subject to the primary supervision
+of a United States court and which has one or more United States persons who have the authority to control all substantial decisions
+of the trust or (B) that has otherwise validly elected to be treated as a United States person under the Code.
+
+ 
+
+If
+a partnership (or other entity or arrangement treated as a partnership for United States federal income tax purposes) is a beneficial
+owner of our Class A Ordinary Shares, the tax treatment of a partner in the partnership will generally depend upon the status of the
+partner as a U.S. Holder, as described above, and the activities of the partnership. Partnerships holding our Class A Ordinary Shares
+and partners in such partnerships are urged to consult their tax advisors as to the particular United States federal income tax consequences
+of an investment in our Class A Ordinary Shares.
+
+ 
+
+ 130
+
+ 
+
+ 
+
+ 
+
+Dividends
+
+ 
+
+The
+entire amount of any cash distribution paid with respect to our Ordinary Shares (including the amount of any non-U.S. taxes withheld
+therefrom, if any) generally will constitute dividends to the extent such distributions are paid out of our current or accumulated earnings
+and profits, as determined under United States federal income tax principles, and generally will be taxed as ordinary income in the year
+received by such U.S. Holder. To the extent amounts paid as distributions on the Ordinary Shares exceed our current or accumulated earnings
+and profits, such distributions will not be dividends but instead will be treated first as a tax-free return of capital to the extent
+of the U.S. Holder s adjusted tax basis, determined for federal income tax purposes, in the Ordinary Shares with respect to which
+the distribution is made, and thereafter as capital gain. However, we do not intend to compute (or to provide U.S. Holders with the information
+necessary to compute) our earnings and profits under United States federal income tax principles. Accordingly, a U.S. Holder will be
+unable to establish that a distribution is not out of earnings and profits and should expect to treat the full amount of each distribution
+as a "dividend" for United States federal income tax purposes.
+
+ 
+
+Any
+dividends that we pay will generally be treated as income from foreign sources for United States foreign tax credit purposes and will
+generally constitute passive category income. Depending on the U.S. Holder s particular facts and circumstances, a U.S. Holder
+may be eligible, subject to a number of complex limitations, to claim a foreign tax credit in respect of any foreign withholding taxes
+imposed (at a rate not exceeding any applicable treaty rate) on dividends received on our Ordinary Shares. A U.S. Holder who does not
+elect to claim a foreign tax credit for foreign tax withheld may instead claim a deduction, for United States federal income tax purposes,
+in respect of such withholdings, but only for a year in which such U.S. Holder elects to do so for all creditable foreign income taxes.
+The rules governing the foreign tax credit are complex. U.S. Holders are advised to consult their tax advisors regarding the availability
+of the foreign tax credit under their particular circumstances.
+
+ 
+
+Dividends
+paid in non-U.S. currency will be included in the gross income of a U.S. Holder in a U.S. dollar amount calculated by reference to a
+spot market exchange rate in effect on the date that the dividends are received by the U.S. Holder, regardless of whether such foreign
+currency is in fact converted into U.S. dollars on such date. Such U.S. Holder will have a tax basis for United States federal income
+tax purposes in the foreign currency received equal to that U.S. dollar value. If such dividends are converted into U.S. dollar on the
+date of receipt, a U.S. Holder generally should not be required to recognize foreign currency gain or loss in respect thereof. If the
+foreign currency so received is not converted into U.S. dollar on the date of receipt, such U.S. Holder will have a basis in the foreign
+currency equal to its U.S. dollar value on the date of receipt. Any gain or loss on a subsequent conversion or other disposition of the
+foreign currency generally will be treated as ordinary income or loss to such U.S. Holder and generally will be income or loss from sources
+within the United States for foreign tax credit limitation purposes. U.S. Holders should consult their own tax advisors regarding the
+treatment of foreign currency gain or loss, if any, on any foreign currency received by a U.S. Holder that is converted into U.S. dollar
+on a date subsequent to receipt.
+
+ 
+
+Sale
+or Other Disposition of Class A Ordinary Shares
+
+ 
+
+A
+U.S. Holder will generally recognize capital gain or loss upon a sale or other disposition of Class A Ordinary Shares, in an amount equal
+to the difference between the amount realized and the U.S. Holder s adjusted tax basis, determined for federal income tax purposes,
+in such Class A Ordinary Shares, each amount determined in U.S. dollar. Any capital gain or loss will be long-term capital gain or loss
+if the Class A Ordinary Shares have been held for more than one year and will generally be United States source gain or loss for United
+States foreign tax credit purposes. The deductibility of a capital loss may be subject to limitations, particularly with regard to shareholders
+who are individuals. Each U.S. Holder is advised to consult its tax advisor regarding the tax consequences if a foreign tax is imposed
+on a disposition of our Class A Ordinary Shares, including the availability of the foreign tax credit under its particular circumstances.
+
+ 
+
+A
+U.S. Holder that receives a currency other than U.S. dollar on the disposition of our Class A Ordinary Shares will realize an amount
+equal to the U.S. dollar value of the non-U.S. currency received at the spot rate on the date of sale (or, if the Class A Ordinary Shares
+are traded on a recognized exchange and in the case of cash basis and electing accrual basis U.S. Holders, the settlement date). An accrual
+basis U.S. Holder that does not elect to determine the amount realized using the spot rate on the settlement date will recognize foreign
+currency gain or loss equal to the difference between the U.S. dollar value of the amount received based on the spot market exchange
+rates in effect on the date of sale or other disposition and the settlement date. A U.S. Holder will have a tax basis in the currency
+received equal to the U.S. dollar value of the currency received on the settlement date. Any gain or loss on a subsequent disposition
+or conversion of the currency will be United States source ordinary income or loss.
+
+ 
+
+Passive
+Foreign Investment Company Considerations
+
+ 
+
+For
+United States federal income tax purposes, a non-United States corporation, such as our Company, will be treated as a "passive
+foreign investment company," or "PFIC" if, in the case of any particular taxable year, either (a) 75% or more of our
+gross income for such year consists of certain types of "passive" income or (b) 50% or more of the value of our assets (generally
+determined on the basis of a quarterly average) during such year produce or are held for the production of passive income. Based upon
+our current and expected income and assets (including goodwill and taking into account the expected proceeds from this offering) and
+the expected market price of our Ordinary Shares following this offering, we do not expect to be a PFIC for the current taxable year
+or the foreseeable future.
+
+ 
+
+ 131
+
+ 
+
+ 
+
+ 
+
+However,
+while we do not expect to be or become a PFIC, no assurance can be given in this regard because the determination of whether we are or
+will become a PFIC for any taxable year is a fact-intensive inquiry made annually that depends, in part, upon the composition and classification
+of our income and assets. Fluctuations in the market price of our Class A Ordinary Shares may cause us to be or become a PFIC for the
+current or subsequent taxable years because the value of our assets for the purpose of the asset test, including the value of our goodwill
+and other unbooked intangibles, may be determined by reference to the market price of our Class A Ordinary Shares (which may be volatile).
+The composition of our income and assets may also be affected by how, and how quickly, we use our liquid assets and the cash raised in
+this offering. It is also possible that the Internal Revenue Service may challenge our classification of certain income or assets for
+purposes of the analysis set forth in subparagraphs (a) and (b), above or the valuation of our goodwill and other unbooked intangibles,
+which may result in our company being or becoming a PFIC for the current or future taxable years.
+
+ 
+
+If
+we are classified as a PFIC for any taxable year during which a U.S. Holder holds our Ordinary Shares, and unless the U.S. Holder makes
+a mark-to-market election (as described below), the U.S. Holder will generally be subject to special tax rules on (i) any excess distribution
+that we make to the U.S. Holder (which generally means any distribution paid during a taxable year to a U.S. Holder that is greater than
+125% of the average annual distributions paid in the three preceding taxable years or, if shorter, the U.S. Holder s holding period
+for the Ordinary Shares); and (ii) any gain realized on the sale or other disposition, including, under certain circumstances, a pledge,
+of Ordinary Shares. Under the PFIC rules:
+
+ 
+
+ 
+ 
+ 
+ such
+ excess distribution and/or gain will be allocated ratably over the U.S. Holder s holding period for the Class A Ordinary Shares;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ such
+ amount allocated to the current taxable year and any taxable years in the U.S. Holder s holding period prior to the first taxable
+ year in which we are a PFIC, each a pre-PFIC year, will be taxable as ordinary income;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ such
+ amount allocated to each prior taxable year, other than a pre-PFIC year, will be subject to tax at the highest tax rate in effect
+ applicable to the U.S. Holder for that year; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ an
+ interest charge generally applicable to underpayments of tax will be imposed on the tax attributable to each prior taxable year,
+ other than a pre-PFIC year.
+
+ 
+ 
+
+If
+we are a PFIC for any taxable year during which a U.S. Holder holds our Class A Ordinary Shares, and we own any equity in a non-United
+States entity that is also a PFIC, or a lower-tier PFIC, such U.S. Holder would be treated as owning a proportionate amount (by value)
+of the shares of the lower-tier PFIC for purposes of the application of these rules. U.S. Holders are advised to consult their tax advisors
+regarding the application of the PFIC rules to any of the entities in which we may own equity.
+
+ 
+
+As
+an alternative to the foregoing rules, a U.S. Holder of "marketable stock" in a PFIC may make a mark-to-market election with
+respect to such stock, provided that certain requirements are met. The mark-to-market election is available only for stock that is regularly
+traded on a national securities exchange that is registered with the SEC, or on a foreign exchange or market that the IRS determines
+is a qualified exchange that has rules sufficient to ensure that the market price represents a legitimate and sound fair market value.
+Although we intend to apply for the listing of our Class A Ordinary Shares on Nasdaq, we cannot guarantee that our listing will be approved.
+Furthermore, we cannot guarantee that, once listed, our Class A Ordinary Shares will continue to be listed and regularly traded on such
+exchange. U.S. Holders are advised to consult their tax advisors as to whether the Class A Ordinary Shares are considered marketable
+for these purposes.
+
+ 
+
+If
+an effective mark-to-market election is made with respect to our Class A Ordinary Shares, the U.S. Holder will generally (i) include
+as ordinary income for each taxable year that we are a PFIC the excess, if any, of the fair market value of Class A Ordinary Shares held
+at the end of the taxable year over its adjusted tax basis of such Class A Ordinary Shares; and (ii) deduct as an ordinary loss the excess,
+if any, of its adjusted tax basis of the Class A Ordinary Shares held at the end of the taxable year over the fair market value of such
+Class A Ordinary Shares held at the end of the taxable year, but only to the extent of the net amount previously included in income as
+a result of the mark-to-market election. The U.S. Holder s adjusted tax basis in the Class A Ordinary Shares would be adjusted
+to reflect any income or loss resulting from the mark-to-market election. If a U.S. Holder makes an effective mark-to-market election,
+in each year that we are a PFIC, any gain recognized upon the sale or other disposition of the Class A Ordinary Shares will be treated
+as ordinary income and loss will be treated as ordinary loss, but only to the extent of the net amount previously included in income
+as a result of the mark-to-market election.
+
+ 
+
+If
+a U.S. Holder makes a mark-to-market election in respect of a PFIC, and such corporation ceases to be a PFIC, the U.S. Holder will not
+be required to take into account the mark-to-market gain or loss described above during any period that such corporation is not a PFIC.
+
+ 
+
+Because
+a mark-to-market election generally cannot be made for any lower-tier PFICs that a PFIC may own, a U.S. Holder who makes a mark-to-market
+election with respect to our Class A Ordinary Shares may continue to be subject to the general PFIC rules with respect to such U.S. Holder s
+indirect interest in any of our non-United States subsidiaries if any of them is a PFIC.
+
+ 
+
+If
+a U.S. Holder owns our Class A Ordinary Shares during any taxable year that we are a PFIC, such holder would generally be required to
+file an annual IRS Form 8621. Each U.S. Holder is advised to consult its tax advisor regarding the potential tax consequences to such
+holder if we are or become a PFIC, including the possibility of making a mark-to-market election.
+
+ 
+
+ 132
+
+ 
+
+ 
+
+ 
+
+Hong
+Kong Profits Tax Considerations
+
+ 
+
+Our
+subsidiaries incorporated in Hong Kong were subject to Hong Kong profits tax at a rate of 8.25% for assessable profits on the first HK$2,000,000
+and 16.5% on their remaining assessable profits generated from operations arising in or derived from Hong Kong for the year of assessment
+of 2020/2021 and 2019/2020. As from year of assessment of 2018/2019 onwards, Hong Kong profits tax rates are 8.25% on assessable profits
+up to HK$2,000,000 and 16.5% on any part of assessable profits over HK$2,000,000. Under Hong Kong tax laws, our Hong Kong subsidiaries
+are exempted from Hong Kong income profits tax on its foreign-derived income profits. In addition, payments of dividends from our Hong
+Kong subsidiaries to us are not subject to any tax withholding in Hong Kong.
+
+ 
+
+Taxation
+of Dividends
+
+ 
+
+Under
+the current practices of the Hong Kong Inland Revenue Department, no tax is payable in Hong Kong in connection with dividends paid by
+us, either by withholding or otherwise, unless such dividends are attributable to a trade, profession or business carried on in Hong
+Kong.
+
+ 
+
+Profits
+
+ 
+
+No
+tax is imposed in Hong Kong in respect of capital gains from the sale of the Ordinary Shares. Trading gains from the sale of Ordinary
+Shares by persons carrying on a trade, profession, or business in Hong Kong, where such gains are derived from or arise in Hong Kong
+from such trade, profession or business will be chargeable to Hong Kong profits tax which is imposed at the rates of 8.25% on assessable
+profits up to HK$2,000,000 and 16.5% on any part of assessable profits over HK$2,000,000 on corporations and at the rates of 7.5% on
+assessable profits up to HK$2,000,000 and 15.0% on any part of assessable profits over HK$2,000,000 on unincorporated businesses from
+the year of assessment commencing on or after April 1, 2018. Liability for Hong Kong profits tax would thus arise in respect of trading
+gains from sales of Ordinary Shares realized by persons carrying on a business of trading or dealing in securities in Hong Kong.
+
+ 
+
+THE
+DISCUSSION ABOVE IS A GENERAL SUMMARY. IT DOES NOT COVER ALL TAX MATTERS THAT MAY BE OF IMPORTANCE TO A PARTICULAR INVESTOR. EACH PROSPECTIVE
+INVESTOR IN OUR ORDINARY SHARES IS URGED TO CONSULT ITS OWN TAX ADVISER ABOUT THE TAX CONSEQUENCES TO IT OF OWNING AND DISPOSING OF OUR
+ORDINARY SHARES IN LIGHT OF SUCH PROSPECTIVE INVESTOR S OWN CIRCUMSTANCES.
+
+ 
+
+UNDERWRITING
+
+ 
+
+We have entered
+into an underwriting agreement dated , 2025 with American Trust Investment Services, Inc. and WestPark Capital, Inc. (the "Representatives"),
+acting as the representatives of the underwriters named below with respect to the Class A Ordinary Shares subject to this offering. Subject
+to the terms and conditions of the underwriting agreement, we have agreed to sell to the underwriters, and each underwriter named below
+has severally agreed to purchase from us, on a firm commitment basis, the number of the Class A Ordinary Shares set forth opposite its
+name below, at the public offering price, less the underwriting discount set forth on the cover page of this prospectus:
+
+ 
+
+ 
+ Name
+ 
+ Number
+ of 
+
+ Ordinary Shares
+ 
+
+ 
+ American Trust Investment Services, Inc.
+ 
+ 
+ 
+ 
+
+ 
+ WestPark
+ Capital, Inc. 
+ 
+ 
+ 
+ 
+
+ 
+ Total
+ 
+ 
+ 3,333,333
+
+ 
+
+ 
+ 
+
+The
+underwriters are offering the Class A Ordinary Shares subject to their acceptance of the Class A Ordinary Shares from us and subject
+to prior sale. The underwriting agreement provides that the obligations of the underwriters to pay for and accept delivery of the Class
+A Ordinary Shares offered by this prospectus are subject to the approval of certain legal matters by their counsel and to certain other
+conditions. The underwriters are obligated to take and pay for all of the Class A Ordinary Shares offered by this prospectus, if any
+such shares are taken. However, the underwriters are not required to take or pay for the Class A Ordinary Shares covered by the underwriters 
+over-allotment option described below.
+
+ 
+
+Our Class A Ordinary
+Shares are offered subject to a number of conditions, including:
+
+ 
+
+ 
+ 
+ 
+ receipt
+ and acceptance of our Class A Ordinary Shares by the underwriters; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ the
+ underwriters right to reject orders in whole or in part.
+
+ 
+
+ 
+
+We
+have granted to the underwriters an option, exercisable for forty-five (45) days from the date of this prospectus, to purchase up to
+an additional 500,000 Ordinary Shares (fifteen percent (15%) of the shares of Class A Ordinary Shares sold in this offering) at
+the price of US$4.5 per Class A Ordinary Share. The option may be exercised in whole or in part, and may be exercised more than
+once, during the 45-day option period. The Underwriters may exercise this option solely for the purpose of covering over-allotments,
+if any, made in connection with the offering contemplated by this prospectus. To the extent that the option is exercised, each underwriter
+will become obligated, subject to certain conditions, to purchase the same percentage of the additional Class A Ordinary Shares as the
+number listed next to the underwriter s name in the preceding table bears to the total number of Class A Ordinary Shares listed
+next to the names of all underwriters in the preceding table. If any additional Class A Ordinary Shares are purchased, the underwriters
+will offer these Class A Ordinary Shares on the same terms as those on which the other Class A Ordinary Shares are being offered.
+
+ 
+
+ 133
+
+ 
+
+ 
+
+ 
+
+The
+Representatives have advised us that they propose to offer the Class A Ordinary Shares to the public at the public offering price set
+forth on the cover page of this prospectus and to certain dealers at that price less a concession not in excess of US$ per
+share. The underwriters may allow, and certain dealers may re-allow a discount from the concession not in excess of US$ per
+Class A Ordinary Share to certain brokers and dealers. After this offering, the public offering price, concession, and reallowance to
+dealers may be reduced by the Representatives. No such reduction shall change the amount of proceeds to be received by us as set forth
+on the cover page of this prospectus. The securities are offered by the underwriters as stated herein, subject to receipt and acceptance
+by them and subject to their right to reject any order in whole or in part. The underwriters have informed us that they do not intend
+to confirm sales to any accounts over which they exercise discretionary authority. We have been advised by the Representatives that the
+underwriters intend to make a market in our Class A Ordinary Shares but that they are not obligated to do so and may discontinue making
+a market at any time without notice.
+
+ 
+
+In
+connection with this offering, certain of the underwriters or securities dealers may distribute prospectuses electronically.
+
+ 
+
+Discounts,
+Commission and Expenses
+
+ 
+
+The
+underwriting discounts and commissions are six percent (6%) of the initial public offering price.
+
+ 
+
+As
+additional compensation to the underwriters, upon consummation of this offering, we will issue to the Representatives or their designees
+warrants to purchase an aggregate number of Class A Ordinary Shares equal to 3.33% of the number of Class A Ordinary Shares issued in
+this offering, at an exercise price per share equal to 120% of the initial public offering price (the "Underwriters Warrants").
+The Underwriters Warrants and the underlying Class A Ordinary Shares will not be exercised, sold, transferred, assigned, or hypothecated
+or be the subject of any hedging, short sale, derivative, put or call transaction that would result in the effective economic disposition
+of the Underwriters Warrants by any person for a period of 180 days from the effective date of the registration statement for
+this offering in accordance with FINRA Rule 5110. The Underwriters Warrants will expire on the fifth anniversary of the effective
+date of the registration statement for this offering. The Underwriters Warrants will contain standard anti-dilution provisions
+and demand and piggyback registration rights. 
+
+ 
+
+The
+following table shows the price per Class A Ordinary Share and total public offering price, underwriting discounts and commissions and
+proceeds before expenses to us. These amounts are shown assuming both no exercise and full exercise of the underwriters over-allotment
+option.
+
+ 
+
+ 
+ 
+ 
+ 
+ Total
+ 
+
+ 
+ 
+ 
+ Per
+ Share
+ 
+ 
+ No
+ Exercise
+ 
+ 
+ Full
+ Exercise
+ 
+
+ 
+ Public
+ offering price
+ 
+ US$
+ 4.50
+
+ 
+ 
+ 
+ 4.50
+
+ 
+ 
+ 
+ 5.40
+
+ 
+
+ 
+ Underwriting
+ discounts and commissions to be paid by us:
+ 
+ US$
+ 0.27
+
+ 
+ 
+ 
+ 0.27
+
+ 
+ 
+ 
+ 0.32
+
+ 
+
+ 
+ Proceeds,
+ before expenses, to us
+ 
+ US$
+ 4.23
+
+ 
+ 
+ 
+ 4.23
+ 
+ 
+ 
+ 5.08
+ 
+
+ 
+ 
+
+In
+connection with and upon closing of the offering contemplated herein, we will also pay to the Representatives a non-accountable expense
+allowance equal to one percent (1%) of the gross proceeds received by us from the sale of the Class A Ordinary Shares.
+
+ 
+
+Additionally,
+we have paid to WestPark Capital, Inc US$40,000 (the "Advance") upon the execution of the engagement letter by and between
+WestPark Capital, Inc and us as an advance against actual out-of-pocket expenses, which shall be applied towards the underwriting discount.
+WestPark Capital, Inc shall return any portion of the Advance not used to pay its accountable out-of-pocket expenses actually incurred
+in accordance with FINRA Rule 5110(g)(4).
+
+ 
+
+In
+addition, we have also agreed to pay all reasonable, necessary and accountable out-of-pocket expenses relating to the offering: (a) all
+filing fees and expenses relating to the registration of the Class A Ordinary Shares with the Commission; (b) all fees and expenses relating
+to the listing of the Class A Ordinary Shares on a national exchange, if applicable; (c) all fees, expenses and disbursements relating
+to the registration or qualification of the Securities under the "blue sky" securities laws of such states and other jurisdictions
+as the Representatives may reasonably designate (including, without limitation, all filing and registration fees, and the reasonable
+fees and disbursements of the Company s "blue sky" counsel, which will be the Representatives counsel) unless
+such filings are not required in connection with the Company s proposed listing on a national exchange, if applicable; (d) all
+fees, expenses and disbursements relating to the registration, qualification or exemption of the Securities under the securities laws
+of such foreign jurisdictions as the Representatives may reasonably designate; (e) the costs of all mailing and printing of the offering
+documents; (f) transfer and/or stamp taxes, if any, payable upon the transfer of Securities from the Company to the Representatives;
+(g) the fees and expenses of the Company s accountants; (h) all filing fees associated with the review of the offering by FINRA;
+(i) the Representatives actual accountable road show expenses for the offering; (j) the cost associated with the Representatives 
+use of book building, prospectus tracking and compliance software for the offering; (k) the fees for the Representatives legal
+counsel; and (l) all fees, expenses, and disbursements relating to background checks of the Company s directors and officers in
+an amount not to exceed US$150,000 in the aggregate. The Company will pay Representatives 1% of the gross proceeds derived from the offering
+for unaccountable expenses allowance.
+
+ 
+
+ 134
+
+ 
+
+ 
+
+ 
+
+Right
+of First Refusal
+
+ 
+
+We
+have agreed to grant the Representatives, for the one-year period following the date of our engagement letter with WestPark Capital,
+Inc, a right of first refusal to provide investment banking services to us on an exclusive basis in all matters for which investment
+banking services are sought by us (such right, the "Right of First Refusal"), which right is exercisable in WestPark Capital,
+Inc s sole discretion but is non-assignable. For these purposes, investment banking services shall include, without limitation,
+(a) acting as lead manager for any underwritten public offering; (b) acting as exclusive placement agent, initial purchaser or financial
+advisor in connection with any private offering of securities of the Company; and (c) acting as financial advisor in connection with
+any sale or other transfer by the Company, directly or indirectly, of a majority or controlling portion of its capital stock or assets
+to another entity, any purchase or other transfer by another entity, directly or indirectly, of a majority or controlling portion of
+the capital stock or assets of our company, and any merger or consolidation of our company with another entity. Notwithstanding the foregoing,
+if WestPark Capital, Inc declines to exercise its right of first refusal for any specific offering, and we complete such offering with
+another investment banking firm, then WestPark Capital, Inc shall not have the right of first refusal for any future offerings of our
+company. In addition, if we receive a proposal from a "bulge bracket" underwriter to undertake a financing, WestPark Capital,
+Inc shall not have the right of first refusal referenced herein (provided, however, that we must use commercially reasonable efforts
+to cause such underwriter to permit the WestPark Capital, Inc to participate in such financing).
+
+ 
+
+Board
+Representation
+
+ 
+
+In
+connection with the offering, we granted WestPark Capital, Inc the right, for a period of one (1) year or until they decline to participate
+in a future Company securities financing, which ever date occurs first, to (a) designate one nominee for election to our board of directors,
+or (b) designate one consultant to our board of directors, which such nominee or consultant will be mutually agreeable to both the Representative
+and us. Should WestPark Capital, Inc elect the latter, the consultant shall have the right to attend all board of directors and Board
+committee meetings (subject to exclusion if necessary to preserve attorney-client privilege) and shall be compensated as if he/she were
+a member of the board of directors.
+
+ 
+
+Indemnification
+
+ 
+
+We
+have agreed to indemnify the underwriters against certain liabilities, including liabilities under the Securities Act and liabilities
+arising from breaches of representations and warranties contained in the underwriting agreement, or to contribute to payments that the
+underwriters may be required to make in respect of those liabilities.
+
+ 
+
+Concurrently
+with the execution and delivery of the underwriting agreement, we will set up an escrow account and will fund such account with US$150,000
+from this offering that may be utilized by the underwriters to fund any bona fide indemnification claims of the underwriters arising
+during a six-month period following the offering. The escrow account will be interest bearing. All funds that are not subject to an indemnification
+claim will be returned to us after the applicable period expires. We will pay the reasonable fees and expenses of the escrow agent.
+
+ 
+
+Lock-Up
+Agreements
+
+ 
+
+We,
+our directors, executive officers and shareholders owning more than 1% of our Ordinary Shares have agreed, subject to limited
+exceptions, including the resale of a portion of our Class A Ordinary Shares by the Selling Shareholders under the Resale Prospectus
+(whom have agreed not to sell the Resale Shares for a period of 21 days from the completion of the initial public offering), not to offer,
+pledge, announce the intention to sell, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract
+to sell, grant any option, right or warrant to purchase or otherwise dispose of, directly or indirectly, or enter into any swap or other
+agreement that transfers, in whole or in part, any of the economic consequences of ownership of our Ordinary Shares, or securities convertible
+into or exercisable or exchangeable for Ordinary Shares for a period of 180 days from the day of this prospectus, without the prior
+written consent of the Representatives. 
+
+ 
+
+No
+Sales of Similar Securities or Repurchases
+
+ 
+
+Without
+the Representatives prior written consent, we have agreed not to:
+
+ 
+
+ 
+ 
+ sell
+ any shares of our capital stock or issue warrants or options, except as may be required pursuant to our employee benefits plans and
+ described in herein; or
+
+ 
+ 
+ purchase
+ any shares of our capital stock
+
+ 
+
+during
+the one (1) year period following the closing of the offering contemplated hereby (other than repurchases at cost or without cost pursuant
+to the terms of any applicable stock option or restricted stock purchase agreement).
+
+ 
+
+ 135
+
+ 
+
+ 
+
+ 
+
+Nasdaq
+Capital Market Listing
+
+ 
+
+We
+have applied to have our Class A Ordinary Shares approved for listing on the Nasdaq Capital Market under the symbol "MEDG".
+We make no representation that such application will be approved or that our Class A Ordinary Shares will trade on such market either
+now or at any time in the future; notwithstanding the foregoing, we will not close this offering unless such Class A Ordinary Shares
+will be listed on the Nasdaq Capital Market at the completion of this offering.
+
+ 
+
+Electronic
+Distribution
+
+ 
+
+A
+prospectus in electronic format may be made available on websites or through other online services maintained by the Representatives
+or by their affiliates. Other than the prospectus in electronic format, the information on the Representatives website and any
+information contained in any other website maintained by it is not part of this prospectus or the registration statement of which this
+prospectus forms a part, has not been approved and/or endorsed by the Company or the Representatives in their capacity as underwriters,
+and should not be relied upon by investors.
+
+ 
+
+Any
+underwriter who is a qualified market maker on the Nasdaq Capital Market may engage in passive market making transactions on the Nasdaq
+Capital Market in accordance with Rule 103 of Regulation M, during the Business Day prior to the pricing of the offering, before the
+commencement of offers or sales. Passive market makers must comply with applicable volume and price limitations and must be identified
+as passive market makers. In general, a passive market maker must display its bid at a price not in excess of the highest independent
+bid for such security; if all independent bids are lowered below the passive market maker s bid, however, the passive market maker s
+bid must then be lowered when certain purchase limits are exceeded.
+
+ 
+
+No
+Public Market
+
+ 
+
+Prior
+to the initial public offering of the Company, there has not been a public market for our securities in the U.S., and the public offering
+price for our Class A Ordinary Shares will be determined through negotiations between the Company and the Representatives. Among the
+factors to be considered in these negotiations will be prevailing market conditions, our financial information, market valuations of
+other companies that the Company and the Representatives believe to be comparable to us, estimates of our business potential, the present
+state of our development and other factors deemed relevant.
+
+ 
+
+We
+offer no assurances that the initial public offering price will correspond to the price at which our Class A Ordinary Shares will trade
+in the public market subsequent to this offering or that an active trading market for our Class A Ordinary Shares will develop and continue
+after this offering.
+
+ 
+
+Price
+Stabilization, Short Positions and Penalty Bids
+
+ 
+
+Until
+the distribution of the Class A Ordinary Shares offered by this prospectus is completed, rules of the SEC may limit the ability of the
+underwriters to bid for and to purchase our Class A Ordinary Shares. As an exception to these rules, the underwriters may engage in transactions
+effected in accordance with Regulation M under the Exchange Act that are intended to stabilize, maintain, or otherwise affect the price
+of our Class A Ordinary Shares. The underwriters may engage in over-allotment sales, syndicate covering transactions, stabilizing transactions
+and penalty bids in accordance with Regulation M.
+
+ 
+
+ 
+Stabilizing transactions consist of bids or purchases made by the managing underwriter for the purpose of preventing or slowing a decline
+in the market price of our securities while this offering is in progress.
+
+ 
+
+ 
+Short sales and over-allotments occur when the managing underwriter, on behalf of the underwriting syndicate, sells more of our shares
+than they purchase from us in this offering. In order to cover the resulting short position, the managing underwriter may exercise the
+overallotment option described above and/or may engage in syndicate covering transactions. There is no contractual limit on the size
+of any syndicate covering transaction. The underwriters will deliver a prospectus in connection with any such short sales. Purchasers
+of shares sold short by the underwriters are entitled to the same remedies under the federal securities laws as any other purchaser of
+units covered by the registration statement.
+
+ 
+
+ 136
+
+ 
+
+ 
+
+ 
+
+ 
+Syndicate covering transactions are bids for or purchases of our securities on the open market by the managing underwriter on behalf
+of the underwriters in order to reduce a short position incurred by the managing underwriter on behalf of the underwriters.
+
+ 
+
+ 
+A penalty bid is an arrangement permitting the managing underwriter to reclaim the selling concession that would otherwise accrue to
+an underwriter if the Class A Ordinary Shares originally sold by the underwriter were later repurchased by the managing underwriter and
+therefore were not effectively sold to the public by such underwriter.
+
+ 
+
+Stabilization,
+syndicate covering transactions and penalty bids may have the effect of raising or maintaining the market price of our Class A Ordinary
+Shares or preventing or retarding a decline in the market price of our Class A Ordinary Shares. As a result, the price of our Class A
+Ordinary Shares may be higher than the price that might otherwise exist in the open market.
+
+ 
+
+Neither
+we nor the underwriters make any representation or prediction as to the effect that the transactions described above may have on the
+prices of our Class A Ordinary Shares. These transactions may occur on the Nasdaq Capital Market or on any trading market. If any of
+these transactions are commenced, they may be discontinued without notice at any time.
+
+ 
+
+Other
+Relationships
+
+ 
+
+The
+underwriters and certain of their affiliates are full service financial institutions engaged in various activities, which may include
+securities trading, commercial and investment banking, financial advisory, investment management, investment research, principal investment,
+hedging, financing, and brokerage activities. Some of the underwriters and certain of their affiliates may in the future engage in investment
+banking and other commercial dealings in the ordinary course of business with us and our affiliates, for which they may in the future
+receive customary fees, commissions, and expenses. In addition, in the ordinary course of their business activities, the underwriters
+and their affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative
+securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers. Such investments
+and securities activities may involve securities and/or instruments of ours or our affiliates. The underwriters and their affiliates
+may also make investment recommendations and/or publish or express independent research views in respect of such securities or financial
+instruments and may hold, or recommend to clients that they acquire, long and/or short positions in such securities and instruments.
+
+ 
+
+Selling
+Restrictions
+
+ 
+
+Canada
+
+ 
+
+Our
+securities may be sold only to purchasers purchasing, or deemed to be purchasing, as principal that are accredited investors, as defined
+in National Instrument 45-106 Prospectus Exemptions or subsection 73.3(1) of the Securities Act (Ontario), and are permitted
+clients, as defined in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations. Any
+resale of our securities must be made in accordance with an exemption from, or in a transaction not subject to, the prospectus requirements
+of applicable securities laws.
+
+ 
+
+Securities
+legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if this prospectus
+(including any amendment thereto) contains a misrepresentation, provided that the remedies for rescission or damages are exercised by
+the purchaser within the time limit prescribed by the securities legislation of the purchaser s province or territory. The purchaser
+should refer to any applicable provisions of the securities legislation of the purchaser s province or territory for particulars
+of these rights or consult with a legal advisor.
+
+ 
+
+Pursuant
+to section 3A.3 (or, in the case of securities issued or guaranteed by the government of a non-Canadian jurisdiction, section 3A.4) of
+National Instrument 33-105 Underwriting Conflicts (NI 33-105), the underwriters are not required to comply with the disclosure
+requirements of NI 33-105 regarding underwriter conflicts of interest in connection with this offering.
+
+ 
+
+European
+Economic Area
+
+ 
+
+In
+relation to each Member State of the European Economic Area which has implemented the Prospectus Regulation, or each, a Relevant Member
+State, an offer to the public of our securities may not be made in that Relevant Member State, except that an offer to the public in
+that Relevant Member State of our securities may be made at any time under the following exemptions under the Prospectus Regulation,
+if they have been implemented in that Relevant Member State:
+
+ 
+
+ 
+ (i)
+ to
+ any legal entity which is a qualified investor as defined in the Prospectus Regulation;
+
+ 
+ 
+ 
+
+ 
+ (ii)
+ to
+ fewer than 150 natural or legal persons (other than qualified investors as defined in the Prospectus Regulation), subject to obtaining
+ the prior consent of the representatives for any such offer; or
+
+ 
+ 
+ 
+
+ 
+ (iii)
+ in
+ any other circumstances falling within Article 1(4) of the Prospectus Regulation, provided that no such offer of securities shall
+ result in a requirement for the publication by us or any underwriter of a prospectus pursuant to Article 3 of the Prospectus Regulation.
+
+ 
+ 
+
+For
+the purposes of this provision, the expression an "offer to the public" in relation to our securities in any Relevant Member
+State means the communication in any form and by any means of sufficient information on the terms of the offer and any securities to
+be offered so as to enable an investor to decide to purchase any securities, and the expression "Prospectus Regulation" means
+Regulation (EU) 2017/1129.
+
+ 
+
+ 137
+
+ 
+
+ 
+
+ 
+
+United
+Kingdom
+
+ 
+
+Each
+underwriter has represented and agreed that:
+
+ 
+
+ 
+ (a)
+ it
+ has only communicated or caused to be communicated and will only communicate or cause to be communicated an invitation or inducement
+ to engage in investment activity (within the meaning of Section 21 of the Financial Services and Markets Act 2000 ("FSMA")
+ received by it in connection with the issue or sale of our securities in circumstances in which Section 21(1) of the FSMA does not
+ apply to us; and
+
+ 
+ 
+ 
+
+ 
+ (b)
+ it
+ has complied and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the securities
+ in, from or otherwise involving the United Kingdom.
+
+ 
+ 
+
+Hong
+Kong
+
+ 
+
+Our
+securities may not be offered or sold by means of any document other than (i) in circumstances which do not constitute an offer to the
+public within the meaning of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap.32, Laws of Hong Kong), (ii) to "professional
+investors" within the meaning of the Securities and Futures Ordinance (Cap.571, Laws of Hong Kong) and any rules made thereunder
+or (iii) in other circumstances which do not result in the document being a "prospectus" within the meaning of the Companies
+(Winding Up and Miscellaneous Provisions) Ordinance (Cap.32, Laws of Hong Kong), and no advertisement, invitation or document relating
+to the securities may be issued or may be in the possession of any person for the purpose of issue (in each case whether in Hong Kong
+or elsewhere), which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong (except if
+permitted to do so under the laws of Hong Kong) other than with respect to the securities which are or are intended to be disposed of
+only to persons outside Hong Kong or only to "professional investors" within the meaning of the Securities and Futures Ordinance
+(Cap.571, Laws of Hong Kong) and any rules made thereunder.
+
+ 
+
+Japan
+
+ 
+
+No
+registration pursuant to Article 4, paragraph 1 of the Financial Instruments and Exchange Law of Japan (Law No. 25 of 1948, as amended)
+(the "FIEL") has been made or will be made with respect to the solicitation of the application for the acquisition of our
+securities.
+
+ 
+
+Accordingly,
+the securities have not been, directly or indirectly, offered or sold and will not be, directly or indirectly, offered or sold in Japan
+or to, or for the benefit of, any resident of Japan (which term as used herein means any person resident in Japan, including any corporation
+or other entity organized under the laws of Japan) or to others for re-offering or re-sale, directly or indirectly, in Japan or to, or
+for the benefit of, any resident of Japan except pursuant to an exemption from the registration requirements, and otherwise in compliance
+with, the FIEL and the other applicable laws and regulations of Japan.
+
+ 
+
+For
+Qualified Institutional Investors ("QII")
+
+ 
+
+Please
+note that the solicitation for newly-issued or secondary securities (each as described in Paragraph 2, Article 4 of the FIEL) in relation
+to the Class A Ordinary Shares constitutes either a "QII only private placement" or a "QII only secondary distribution"
+(each as described in Paragraph 1, Article 23-13 of the FIEL). Disclosure regarding any such solicitation, as is otherwise prescribed
+in Paragraph 1, Article 4 of the FIEL, has not been made in relation to the Ordinary Shares. The securities may only be transferred to
+QIIs. 
+
+ 
+
+For
+Non-QII Investors
+
+ 
+
+Please
+note that the solicitation for newly-issued or secondary securities (each as described in Paragraph 2, Article 4 of the FIEL) in relation
+to the securities constitutes either a "small number private placement" or a "small number private secondary distribution"
+(each as is described in Paragraph 4, Article 23-13 of the FIEL). Disclosure regarding any such solicitation, as is otherwise prescribed
+in Paragraph 1, Article 4 of the FIEL, has not been made in relation to the securities. The securities may only be transferred en
+bloc without subdivision to a single investor.
+
+ 
+
+Singapore
+
+ 
+
+This
+prospectus has not been registered as a prospectus with the Monetary Authority of Singapore. Accordingly, this prospectus and any other
+document or material in connection with the offer or sale, or invitation for subscription or purchase, of our securities may not be circulated
+or distributed, nor may the securities be offered or sold, or be made the subject of an invitation for subscription or purchase, whether
+directly or indirectly, to persons in Singapore other than (i) to an institutional investor (as defined under Section 4A of the SFA)
+pursuant to Section 274 of the SFA, (ii) to a relevant person (as defined in Section 275(2) of the SFA) pursuant to Section 275(1) of
+the SFA, or any person pursuant to Section 275(1A), and in accordance with the conditions specified in Section 275 of the SFA or (iii)
+otherwise pursuant to, and in accordance with the conditions of, any other applicable provision of the SFA, in each case subject to conditions
+set forth in the SFA.
+
+ 
+
+Where
+our securities are subscribed or purchased under Section 275 by a relevant person which is a corporation (which is not an accredited
+investor as defined in Section 4A of the SFA) the sole business of which is to hold investments and the entire share capital of which
+is owned by one or more individuals, each of whom is an accredited investor, the securities or securities-based derivatives contracts
+(each as defined in Section 2(1) of the SFA) of that corporation shall not be transferable for 6 months after that corporation has acquired
+our securities under Section 275 except: (a) to an institutional investor under Section 274 of the SFA or to a relevant person, (b) where
+such transfer arises from an offer in that corporation s securities pursuant to Section 275(1A) of the SFA, and in accordance with
+the conditions, specified in Section 275 of the SFA; (c) where no consideration is or will be given for the transfer; (d) where such
+transfer is by operation of law; or (e) as specified in Section 276(7) of the SFA.
+
+ 
+
+Where
+the securities are subscribed or purchased under Section 275 of the SFA by a relevant person which is a trust (where the trustee is not
+an accredited investor (as defined in Section 4A of the SFA)) whose sole purpose is to hold investments and each beneficiary of the trust
+is an accredited investor, the beneficiaries rights and interest (howsoever described) in that trust shall not be transferable
+for 6 months after that trust has acquired the shares under Section 275 of the SFA except: (1) to an institutional investor under Section
+274 of the SFA or to a relevant person, (2) where such transfer arises from an offer that is made on terms that such rights or interest
+are acquired at a consideration of not less than S$200,000 (or its equivalent in a foreign currency) for each transaction (whether such
+amount is to be paid for in cash or by exchange of securities or other assets), (3) where no consideration is or will be given for the
+transfer, (4) where the transfer is by operation of law, or (5) as specified in Section 276(7) of the SFA.
+
+ 
+
+South
+Korea. The Class A Ordinary Shares may not be offered, sold and delivered directly or indirectly, or offered or sold to any person
+for re-offering or resale, directly or indirectly, in South Korea or to any resident of South Korea except pursuant to the applicable
+laws and regulations of South Korea, including the Financial Investment Services and Capital Markets Act and the Foreign Exchange Transaction
+Law and the decrees and regulations thereunder. The Class A Ordinary Shares have not been registered with the Financial Services Commission
+of South Korea for public offering in South Korea. Furthermore, the Class A Ordinary Shares may not be re-sold to South Korean residents
+unless the purchaser of the shares complies with all applicable regulatory requirements (including but not limited to government approval
+requirements under the Foreign Exchange Transaction Law and its subordinate decrees and regulations) in connection with their purchase.
+
+ 
+
+Taiwan.
+The shares have not been and will not be registered or filed with, or approved by, the Financial Supervisory Commission of Taiwan
+pursuant to relevant securities laws and regulations and may not be offered or sold in Taiwan through a public offering or in circumstances
+which constitute an offer within the meaning of the Securities and Exchange Act of Taiwan or relevant laws and regulations that require
+a registration, filing or approval of the Financial Supervisory Commission of Taiwan. No person or entity in Taiwan has been authorized
+to offer or sell the shares in Taiwan.
+
+ 
+
+United
+Kingdom. An offer of the shares may not be made to the public in the United Kingdom within the meaning of Section 102B of the Financial
+Services and Markets Act 2000, as amended, or the FSMA, except to legal entities that are authorized or regulated to operate in the financial
+markets or, if not so authorized or regulated, whose corporate purpose is solely to invest in securities or otherwise in circumstances
+that do not require the publication by the company of a prospectus pursuant to the Prospectus Rules of the Financial Services Authority,
+or the FSA.
+
+ 
+
+An
+invitation or inducement to engage in investment activity (within the meaning of Section 21 of FSMA) may only be communicated to persons
+who have professional experience in matters relating to investments falling within Article 19(5) of the Financial Services and Markets
+Act 2000 (Financial Promotion) Order 2005 or in circumstances in which Section 21 of FSMA does not apply to the company.
+
+ 
+
+All
+applicable provisions of the FSMA with respect to anything done by the Underwriter in relation to the shares must be complied with in,
+from or otherwise involving the United Kingdom.
+
+ 
+
+ 138
+
+ 
+
+ 
+
+ 
+
+LEGAL
+MATTERS
+
+ 
+
+Certain
+legal matters in connection with this offering with respect to United States federal securities law will be passed upon us by K&L
+Gates LLP. The underwriters are being represented by Haneberg Hurlbert PLC with
+respect to certain legal matters as to United States federal securities laws. The validity of the Ordinary Shares offered in this offering
+and other certain legal matters as to Cayman Islands law will be passed upon for us by Ogier. Certain legal matters as to Hong Kong law
+will be passed upon for us by O Tse & Co. with respect to matters governed by Hong Kong law. Cayman Islands law may rely upon Ogier
+with respect to matters governed by Cayman Islands law. China law may rely upon Guangdong Wesley Law Firm with respect to matters governed
+by China law,.
+
+ 
+
+EXPERTS
+
+ 
+
+The
+financial statements as of June 30, 2024, and 2023 included in this prospectus have been audited by TAAD LLP, an independent registered
+public accounting firm, as stated in their report appearing herein. Such financial statements have been so included in reliance upon
+the report of such firm given upon the authority of such firm as experts in accounting and auditing.
+
+ 
+
+WHERE
+YOU CAN FIND MORE INFORMATION
+
+ 
+
+We
+have filed a registration statement, including relevant exhibits, with the SEC on Form F-1 under the Securities Act with respect to the
+underlying Class A Ordinary Shares to be sold in this offering. For the purposes of this section, the term "registration statement"
+means the original registration statement and any and all amendments thereto including the schedules and exhibits to the original registration
+statement or any amendment. This prospectus, which constitutes a part of the registration statement on Form F-1, does not contain all
+of the information contained in the registration statement. You should read our registration statement and the exhibits and schedules
+thereto for further information with respect to us and our Ordinary Shares.
+
+ 
+
+Immediately
+upon the effectiveness of the registration statement on Form F-1 of which this prospectus forms a part, we will become subject to periodic
+reporting and other informational requirements of the Exchange Act as applicable to foreign private issuers. Accordingly, we will be
+required to file reports, including annual reports on Form 20-F, and other information with the SEC. All information filed with the SEC,
+including the registration statement, can be obtained over the Internet at the SEC s website at www.sec.gov or inspected and copied
+at the public reference facilities maintained by the SEC at 100 F Street, N.E., Washington, D.C. 20549. You can request copies of documents,
+upon payment of a duplicating fee, by writing to the SEC.
+
+ 
+
+As
+a foreign private issuer, we are exempt under the Exchange Act from, among other things, the rules prescribing the furnishing and content
+of proxy statements, and our executive officers, directors and principal shareholders are exempt from the reporting and short-swing profit
+recovery provisions contained in Section 16 of the Exchange Act. In addition, we will not be required under the Exchange Act to file
+periodic reports and financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are registered
+under the Exchange Act. As we are a foreign private issuer, we will be required to file our annual report on Form 20-F within 120 days
+of the end of each year. However, we intend to furnish the depositary with our annual reports, which will include a review of operations
+and annual audited consolidated financial statements prepared in conformity with U.S. GAAP, and all notices of shareholders meetings
+and other reports and communications that are made generally available to our shareholders.
+
+ 
+
+ 139
+
+ 
+
+ 
+
+ 
+
+RESALE
+PROSPECTUS ALTERNATE PAGE
+
+ 
+
+The
+information in this prospectus is not complete and may be changed or supplemented. We may not sell these securities until the registration
+statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and
+it is not soliciting an offer to buy these securities in any jurisdiction where such offer or sale is not permitted.
+
+ 
+
+ 
+ PRELIMINARY
+ PROSPECTUS
+ Subject
+ to Completion, dated September 29, 2025
+
+ 
+ 
+
+4,272,222
+Class A Ordinary Shares to be sold by the Selling Shareholders
+
+ 
+
+ 
+
+MEDI
+Group Limited
+
+ 
+
+This
+prospectus relates to 4,272,222 of our Class A Ordinary Shares US$0.0001 par value, of MEDI Group Limited that may be sold from time
+to time by the selling shareholders named in this prospectus (the "Selling Shareholders"). This will only permit the Selling
+Shareholders to sell the number of Class A Ordinary Shares identified in the column "Shares to be Offered" below.
+We will not receive any of the proceeds from the sale of our Class A Ordinary Shares by the Selling Shareholders. The Class A Ordinary
+Shares owned by the Selling Shareholders are "restricted" securities under applicable U.S. federal and state securities laws
+and are being registered pursuant to this prospectus to enable the Selling Shareholders to sell those Class A Ordinary Shares. The Company
+will not receive any proceeds from the sale of Class A Ordinary Shares by the Selling Shareholders.
+
+ 
+
+On , 2025,
+a registration statement under the Securities Act with respect to our initial public offering underwritten by American Trust Investment
+Services, Inc. and Westpark Capital as the underwriters, of $4.5 of our Class A Ordinary Shares was declared effective by the
+Securities and Exchange Commission. We received approximately $13 million in net proceeds from the offering (assuming no exercise
+of the underwriters over-allotment option) after payment of underwriting discounts and commissions and estimated expenses of the
+offering.
+
+ 
+
+Prior
+to the initial public offering of the Company, there has been no public market for our Class A Ordinary Shares. We have applied to list
+our Class A Ordinary Shares on the Nasdaq Capital Market under the symbol "MEDG". We have not been approved for listing on
+the Nasdaq Capital Market; however, we believe that we currently meet the Nasdaq Capital Market s quantitative listing requirements
+and believe that upon the completion of the offerings, we will meet the standards for listing on the Nasdaq Capital Market and the initial
+public offering of the Company has been completed. The Selling Shareholders will not be able to sell their shares unless the Company s
+Class A Ordinary Shares are approved for listing on the Nasdaq Capital Market. There can be no assurance that the Company will be successful
+in listing its Class A Ordinary Shares on the Nasdaq Capital Market.
+
+ 
+
+The distribution of securities
+offered hereby may be effected in one or more transactions that may take place on the Nasdaq Capital Market, including ordinary brokers 
+transactions, privately negotiated transactions or through sales to one or more dealers for resale of such securities as principals,
+at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices. Usual and
+customary or specifically negotiated brokerage fees or commissions may be paid by the Selling Shareholders.
+
+ 
+
+MEDG s issued and outstanding
+share capital is a dual-class structure consisting of Class A Ordinary Shares and Class B Ordinary Shares. Holders of Class A Ordinary
+Shares and Class B Ordinary Shares shall vote together as one class on all resolutions of the shareholders to control any action requiring
+the approval of our shareholders, including the election of our board of directors, the adoption of amendments to our certificate of
+incorporation and bylaws, and the approval of any merger, consolidation, sale of all or substantially all of our assets, or other major
+corporate transactions, and have the same rights except each Class A Ordinary Share shall entitle its holder to one (1) vote per share
+and each Class B Ordinary Share shall entitle its holder to twenty (20) votes per share. Each Class B Ordinary Share is convertible into
+one (1) Class A Ordinary Share at any time at the option of the holder thereof but Class A Ordinary Shares are not convertible into Class
+B Ordinary Shares.
+
+ 
+
+MEDG is a holding company
+incorporated in the Cayman Islands with no material operations of its own. We conduct our operations in Hong Kong through Grand Century
+Holding Company Limited ("GCHL" or the "Operating Subsidiary").
+
+ 
+
+Investors
+are cautioned that the Class A Ordinary Shares they are buying are shares of MEDG, a Cayman Islands holding company, and not shares of
+our Hong Kong subsidiaries. Investors in this offering will not directly hold equity interests in our Hong Kong subsidiaries.
+
+ 
+
+This
+structure involves unique risks to the investors. Furthermore,
+we operate all of our business in Hong Kong, a Special Administrative Region of China. The PRC government may exercise significant
+oversight and discretion over the conduct of business in Hong Kong, may intervene in or influence our operations at any time, or could
+disallow this structure, which could result in a material change in our operations and/or the value of our Class A Ordinary Shares. See
+"Risk Factors – Risks Related to Doing Business in the PRC –We conduct substantially all of our operations in Hong
+Kong, if we should become subject to the recent scrutiny, criticism and negative publicity involving U.S.-listed Chinese companies, we
+may have to expend significant resources to investigate and/or defend the allegations, which could harm our business operations, this
+offering and our reputation and could result in a loss of your investment in our Class A Ordinary Shares if such allegations cannot be
+addressed and resolved favorably." and "Risk Factors – Risks Related to Doing Business in the PRC – The
+Chinese regulators could also disallow our organizational structure, which would likely result in a material change in our operations
+and/or a material change in the value of the securities we are registering for sale, including that it could cause the value of such
+securities to significantly decline or become worthless." at page 26 of this prospectus for more detailed discussion of these
+risk factors.
+
+ 
+
+ Alt - 1
+
+ 
+
+ 
+
+ 
+
+Hong
+Kong s legal system is based on common law, supplemented by statutes. National laws of the PRC do not apply in Hong Kong unless
+they are listed in Annex III of the Basic Law, the constitutional document of Hong Kong. National laws that may be listed in Annex III
+are currently limited under the Basic Law to those which fall within the scope of defense, foreign affairs and national security as well
+as other matters outside the limits of the autonomy of Hong Kong. The enactment, application and enforcement of Hong Kong laws and regulations
+in Hong Kong and those in mainland China are separate from each other.
+
+ 
+
+Hong
+Kong s capitalist system is enshrined in the Basic Law. Among others, there are no restrictions or limitations under the laws of
+Hong Kong imposed on the conversion of Hong Kong dollar into foreign currencies and the remittance of currencies out of Hong Kong; the
+transfer of cash, in Hong Kong dollar or foreign currencies, between companies based in Hong Kong across borders and to U.S. investors;
+and the distribution of earnings from a business in Hong Kong to its offshore owners, except that a Hong Kong company may make a distribution
+out of profits available for distribution.
+
+ 
+
+Future developments in the
+legal system in the PRC, amendments to the Basic Law and changes in PRC government policies may lead to changes in the interpretation
+and application of the above principles. As of the date of the prospectus, neither the national laws of the PRC, nor the rules and policies
+of PRC regulators, affect the operation of businesses in Hong Kong.
+
+ 
+
+We
+are an "emerging growth company" and a "foreign private issuer" under applicable U.S. federal securities laws
+and, as such, are eligible for reduced public company reporting requirements. Please see "Implications of Being an Emerging Growth
+Company" and "Implications of Being a Foreign Private Issuer" on page 16 of this prospectus for more information.
+
+ 
+
+Investing
+in our Class A Ordinary Shares involves significant risks. The risks could result in a material change in the value of the securities
+we are registering for sale, including the risk of losing your entire investment or could significantly limit or completely hinder our
+ability to offer or continue to offer securities to investors. See "Risk Factors" beginning on page 20 to read about
+factors you should consider before buying our Class A Ordinary Shares.
+
+ 
+
+We are subject to legal
+and operational risks associated with having certain of our operations in Hong Kong, including risks related to the legal, political
+and economic policies of the PRC government, the relations between China and Hong Kong and China and the United States, or Chinese or
+the United States regulations, which risks could result in a material change in our operations and/or cause our Class A Ordinary Shares
+to significantly decline in value or become worthless and affect our ability to offer or continue to offer securities to investors. Recently,
+the PRC government initiated a series of regulatory actions and made a number of public statements on the regulation of business operations
+in China with little advance notice, including cracking down on illegal activities in the securities market, enhancing supervision over
+Chinese companies listed overseas, adopting new measures to extend the scope of cybersecurity reviews, and expanding efforts in anti-monopoly
+enforcement. We may be subject to these regulatory actions or statements. Although we have not engaged in any monopolistic behavior,
+our business does involve the collection of user data and may implicate cybersecurity reviews. We currently expect that these new regulations
+may have an impact on our Hong Kong subsidiaries or this offering.
+
+ 
+
+On
+February 17, 2023, with the approval of the State Council, the China Securities Regulatory Commission (the "CSRC") promulgated
+the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies ("New Overseas Listing
+Rules"), and five supporting guidelines, which came into effect on March 31, 2023. Pursuant to the New Overseas Listing
+Rules, domestic companies that seek to offer or list securities overseas, both directly and indirectly, shall complete filing procedures
+with the CSRC pursuant to the requirements of the New Overseas Listing Rules within three working days following their submission of
+initial public offerings or listing applications. If a domestic company fails to complete the required filing procedures or conceals
+any material fact or falsifies any major content in its filing documents, such domestic company may be subject to administrative penalties,
+such as an order to rectify, warnings and fines, and its controlling shareholders, actual controllers, the person directly in charge
+and other directly liable persons may also be subject to administrative penalties, such as warnings and fines. 
+
+ 
+
+The filing requirements
+under the New Overseas Listing Rules do not apply to the Company since: (i) the revenue, total profit, total assets or net assets of
+the Company is 100% outside of PRC for the fiscal year ended June 30, 2024 and as of the day of this prospectus; and (ii) the majority
+of senior management are non-PRC citizens and reside in Hong Kong. 
+
+ 
+
+However, there can
+be no assurance that the relevant PRC regulators, including the CSRC, would reach the same conclusion as us, or that the CSRC or any
+other PRC regulators would not promulgate new rules or new interpretation of current rules (with retrospective effect) to require us
+to obtain CSRC or other PRC governmental approvals for this offering. If we inadvertently concluded that such approvals are not required,
+our ability to offer or continue to offer our Class A Ordinary Shares to investors could be significantly limited or completely hindered,
+which could cause the value of our Class A Ordinary Shares to significantly decline or become worthless. We may also face sanctions by
+the CSRC, the Cyberspace Administration of China ("CAC") or other PRC regulators. These regulators may impose fines, penalties,
+limit our operations in China, or take other actions that could have a material adverse effect on our business, financial condition,
+results of operations and prospects, as well as the trading price of our securities. See "Risk Factors" beginning on page
+20 for a discussion of these legal and operational risks and other information that should be considered before making a decision to
+purchase our Class A Ordinary Shares.
+
+ 
+
+ Alt - 2
+
+ 
+
+ 
+
+ 
+
+Although Hong Kong
+is a Special Administrative Region and a dependency of the PRC, it has enacted its own laws pertaining to data security and anti-monopoly
+concerns. Hong Kong has enacted the Personal Data (Privacy) Ordinance (the "PDPO") to ensure an adequate level of data protection
+to retain its status as an international trading center and to give effect to human rights treaty obligations. Moreover, Hong Kong has
+also enacted a similar piece of legislation regulating competition in the market (the "Competition Ordinance"). The Competition
+Ordinance prohibits: (i) anti-competitive agreements and concerted practices; and (ii) abuse of power with the object or effect of preventing,
+restricting or distorting competition in Hong Kong. If we were to be found in violation of either of these laws, our operations may be
+restricted, and they may be required or elect to make changes to their operations in Hong Kong so as to be in accordance with the PDPO
+and/or the Competition Ordinance. Moreover, Hong Kong regulators may take other action against us, such as imposing taxes or other penalties,
+which could materially affect our financial results. Thus, our revenue and business operations in Hong Kong would be adversely affected.
+
+ 
+
+In addition, the Holding
+Foreign Companies Accountable Act (the "HFCAA"), which prohibits foreign companies from listing their securities on U.S.
+stock exchanges if the companies auditors have been unavailable for Public Company Accounting Oversight Board ("PCAOB")
+inspection or investigation for three consecutive years, became law in December 2020. On December 16, 2021, the PCAOB issued a determination
+(the "Determination Report") that the PCAOB is unable to inspect or investigate completely PCAOB-registered public accounting
+firms headquartered in mainland China and in Hong Kong because of positions taken by regulators in those jurisdictions, and the PCAOB
+included in the Determination Report a list of the accounting firms that are headquartered in the PRC. On December 15, 2022, the PCAOB
+announced that it has secured complete access to inspect and investigate registered public accounting firms headquartered in mainland
+China and Hong Kong and voted to vacate the previous 2021 Determination Report to the contrary. The SEC adopted final amendments to its
+rules to implement the HFCAA, which went into effect on January 20, 2022. As part of the SEC s final rules, identified issuers
+will need to provide additional disclosures in subsequent filings that prove the issuer is not owned or controlled by a governmental
+authority in the foreign jurisdiction of the audit firm identified by the PCAOB in the Determination Report. Our auditor, TAAD LLP, which
+is based in Diamond Bar, California, is registered with the PCAOB, is subject to PCAOB regular inspection and was last inspected in November
+2022. The PCAOB shall be able to inspect or investigate completely our auditor or our work papers.
+
+ 
+
+Furthermore,
+on June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act (the "AHFCAA"), which
+was enacted on December 29, 2022, and amended the HFCAA to require the SEC to prohibit an issuer s securities from trading on any
+U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three.
+
+ 
+
+On
+August 26, 2022, the CSRC, the Ministry of Finance of the PRC (the "MOF"), and the PCAOB signed a Statement of Protocol (the
+"Protocol") to allow the PCAOB to inspect and investigate completely registered public accounting firms headquartered in
+mainland China and Hong Kong, consistent with the HFCAA, and the PCAOB will be required to reassess its determinations by the end of
+2022. Pursuant to the fact sheet with respect to the Protocol disclosed by the SEC, the PCAOB shall have independent discretion to select
+any issuer audits for inspection or investigation and has the unfettered ability to transfer information to the SEC.
+
+ 
+
+On December 15, 2022,
+the PCAOB Board determined that the PCAOB was able to secure complete access to inspect and investigate registered public accounting
+firms headquartered in mainland China and Hong Kong and voted to vacate its previous determinations to the contrary. However, should
+PRC regulators obstruct or otherwise fail to facilitate the PCAOB s access in the future, the PCAOB Board will consider the need
+to issue a new determination. On December 29, 2022, the AHFCAA was enacted, which amended the HFCAA by decreasing the number of non-inspection
+years from three years to two, thus reducing the time period before our common stock may be prohibited from trading or delisted. Notwithstanding
+the foregoing, in the event it is later determined that the PCAOB is unable to inspect or investigate completely our auditor, then such
+lack of inspection could cause our securities to be delisted from the stock exchange. See "Risk Factors — Risks Related
+to Doing Business in the PRC — Our Class A Ordinary Shares may be prohibited from trading in the United States under the HFCAA
+in the future if the PCAOB is unable to inspect or investigate our auditors located in Hong Kong." on page 27.
+
+ 
+
+ Alt - 3
+
+ 
+
+ 
+
+ 
+
+MEDG is the holding
+company of our group. Its main asset is the shares in its direct wholly-owned subsidiary MEDI Trade Holding Limited, which in turn hold
+shares in the Operating Subsidiary and other group entities. As of the date of this prospectus, none of our other group entities have
+paid any dividends or other distributions to our holding company, and there have been no cash flows between our holding company and any
+of our other group entities. Since our operations are completely in Hong Kong, the transfer of funds among companies is unrestricted.
+To the extent cash or assets are held in our business in Hong Kong, the funds or assets may be available to fund operations or for other
+use outside Hong Kong without restrictions and limitations. We intend to conduct regular review and management of all of our Hong Kong
+subsidiaries cash transfers and report to our board of directors.
+
+ 
+
+However, as a holding
+company, we will rely on dividends and other distributions on equity paid by our Hong Kong subsidiaries for our cash and financing requirements.
+If our Hong Kong subsidiaries incur debt on their own behalf in the future, the instruments governing such debt may restrict their ability
+to pay dividends to us. Moreover, in the future, cash proceeds raised from overseas financing activities, including this offering, may
+be transferred by us to our Hong Kong subsidiaries via capital contribution or shareholder loans, as the case may be. The PRC government
+imposes controls on the convertibility of the Renminbi into foreign currencies and, in certain cases, the remittance of currency out
+of China, see "Risk Factors — Risks Related to Doing Business in the PRC — To the extent cash or assets in our business
+is in the PRC or in our Hong Kong subsidiaries, the funds or assets may not be available to fund operations or for other use outside
+of the PRC due to interventions in or the imposition of restrictions and limitations on our ability or the ability of our Hong Kong subsidiaries
+by the PRC government to transfer cash or assets." on page 26.
+
+ 
+
+Immediately after the completion
+of the IPO and prior to the sale of any Resale Shares, our Controlling Shareholder, Master Centric Limited ("MCL"), a British
+Virgin Islands company, of which 99% is owned by Mr. Ng Hon Kin, chairman, CEO and executive director of the Company, will beneficially
+own 222,222 Class A Ordinary Shares and 17,327,778 Class B Ordinary Shares, representing 96.44% of the voting power in the Company.
+
+ 
+
+This prospectus covers the offering
+of 222,222 Class A Ordinary Shares by MCL. After the completion of the offering of its respective Resale Shares by MCL, MCL
+will beneficially own 17,327,778 Class B Ordinary Shares representing in the aggregate 96.38% total voting power in the Company.
+
+ 
+
+Neither
+the SEC nor any state securities commission nor any other regulatory body has approved or disapproved of these securities or determined
+if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
+
+ 
+
+RESALE
+PROSPECTUS ALTERNATE PAGE
+
+ 
+
+ Alt - 4
+
+ 
+
+ 
+
+ 
+
+TABLE
+OF CONTENTS
+
+ 
+
+ 
+ 
+ Page
\ No newline at end of file
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@@ -0,0 +1 @@
+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: we, us, company or our company are to McKinley Acquisition Corporation, a Cayman Islands exempted company; Companies Act or Companies Law are to the Companies Act (2025 Revision) of the Cayman Islands as the same may be amended from time to time; completion window are to (i) the period ending on the date that is 18 months from the closing of this offering (or 24 months if we have executed a definitive agreement for an initial business combination within 18 months from the closing of this offering) or such earlier liquidation date as our board of directors may approve, in which we must complete an initial business combination or (ii) such other time period in which we must complete an initial business combination pursuant to an amendment to our amended and restated memorandum and articles of association; founder shares are to Class B ordinary shares initially purchased by our sponsor in a private placement prior to this offering and the Class A ordinary shares that will be issued upon the automatic conversion of the Class B ordinary shares at the time of our initial business combination or earlier at the option of the holders thereof as described herein (for the avoidance of doubt, such Class A ordinary shares will not be public shares ); initial shareholders are to our sponsor and any other holders of our founder shares immediately prior to this offering; Investment Company Act are to the Investment Company Act of 1940, as amended; management or our management team are to our officers and directors; non-managing sponsor investors means select institutional investors (none of which are affiliated with any member of our management, other members of our sponsor or any other investor) that have expressed an interest to purchase indirectly, through the purchase of non-managing sponsor membership interests an aggregate of 327,500 of the 420,000 private placement units being purchased by our sponsor at a price of $10.00 per unit ($3,275,000 in the aggregate); subject to each non-managing sponsor investor purchasing, through the sponsor, the private placement units allocated to it in connection with the closing of this offering, the sponsor will issue membership interests at a nominal purchase price ($0.004) to the non-managing sponsor investors at the closing of this offering reflecting interests in an aggregate of 2,620,000 founder shares (or up to 5,620,000 founder shares in certain circumstances) held by the sponsor. None of the non-managing sponsor investors has expressed to us an interest in purchasing more than 9.9% of the units to be sold in this offering; ordinary resolution are to a resolution of the company passed by a simple majority of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at a general meeting of the company, or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter (or such lower threshold as may be allowed under the Companies Law from time to time); ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; permitted withdrawals means amounts withdrawn to pay income or franchise (but not excise) taxes. All permitted withdrawals can only be made from interest and not from the principal held in the trust account; public shares are to Class A ordinary shares sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); 1 Table of Contents public shareholders are to the holders of our public shares, including our initial shareholders, our management team and any non-managing sponsor investors, to the extent our initial shareholders, members of our management team and any non-managing sponsor investors purchase public shares, provided that the each initial shareholder s or member of our management team s or non-managing sponsor investor s status as a public shareholder will only exist with respect to such public shares; public rights are to the rights sold as part of the units in this offering (whether they are purchased in this offering or thereafter in the open market); private placement units are to the units issued and sold to our sponsor, Clear Street, and Brookline in a private placement simultaneously with the closing of this offering; private placement rights are to the rights underlying the private placement units; representative shares refer to 75,000 Class A ordinary shares (or 86,250 Class A ordinary shares if the underwriters over-allotment option is exercised in full) to be issued to Clear Street, and/or its designees, at the closing of this offering; rights are to our public rights and private placement rights. special resolution are to a resolution of the company passed by at least a two-thirds (2/3) majority (or such higher approval threshold as specified in the company s amended and restated memorandum and articles of association) of the votes cast by such shareholders as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at a general meeting of the company of which notice specifying the intention to propose the resolution as a special resolution has been duly given, or a resolution approved in writing by all of the holders of the issued shares entitled to vote on such matter (or such lower threshold as may be allowed under the Companies Law from time to time); and sponsor are to McKinley Partners LLC, a Delaware limited liability company which was recently formed to invest in our company, as further discussed under Sponsor Information , below; Any conversion of the Class B ordinary shares described in this prospectus will take effect as a compulsory redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any forfeiture of shares, and all references to forfeiture of shares, described in this prospectus shall take effect as a surrender of shares for no consideration as a matter of Cayman Islands law. Any share dividend described in this prospectus will take effect as a share capitalization as a matter of Cayman Islands law (that is, an issuance of shares from share premium). Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. Our Company We are a newly formed blank check company, incorporated on March 27, 2025, as an exempted company under the laws of the Cayman Islands. Our purpose is to effect a merger, share exchange, asset acquisition, share purchase, reorganization, or other similar business combination with one or more operating businesses (which we refer to throughout this prospectus as our initial business combination ). We have not identified any specific business combination target, and neither we nor anyone on our behalf has engaged in any substantive discussions, directly or indirectly, with any potential target. While our search will not be limited to a particular industry, geography, or stage of corporate development, we intend to focus on identifying and acquiring one or more businesses with a total enterprise value between $500 million and $2 billion that are well-positioned for long-term growth and value creation. Our strategy is to partner with a company that demonstrates strong fundamentals, proven leadership, and a differentiated market position with the potential to benefit from enhanced capital access, strategic guidance, and public market readiness. We are particularly focused on businesses with resilient operating models, scalable platforms, and the potential to lead in their respective sectors. 2 Table of Contents Our sponsor group, which includes our management team and board of directors (collectively, our Founders ), brings a multi-decade track record of building and scaling successful public and private enterprises. Our Founders have held senior leadership positions across prominent buy-side and sell-side financial institutions, and bring complementary experience from founding and leading capital markets advisory firms. Their collective expertise spans public market transactions, private equity, M&A, financial restructuring, and operational optimization. Leveraging our team s deep network of industry relationships and access to high-quality proprietary deal flow, we intend to identify a business combination target where our capital, strategic resources, and public company experience can accelerate growth, institutionalize operations, and drive long-term shareholder value. Investment Thesis Our investment strategy is guided by the thematic expertise and strategic insight of our management team and advisory board, with a specific focus on progressive industries those experiencing accelerated innovation, structural change, and capital-intensive growth. We define progressive industries as segments within broader sectors that are being reshaped by technology, evolving consumer behavior, or regulatory transformation. These include, but are not limited to, financial technology (fintech), mobility (transporttech), agricultural technology (agtech), clean technology (cleantech), space technology (spacetech), and advanced artificial intelligence. We intend to pursue a business combination with a company operating in one or more of these forward-looking sectors that we believe can benefit meaningfully from access to U.S. public capital markets. Our ideal target profile includes high-growth businesses that are: Are at an inflection point with tangible accelerate growth, increase pro tability, and/or enhance capital ef ciency all of which drives long-term 3-5x multiple expansion, Seeking capital that reduces WACC by 150-320 bps to scale operations, or expand product lines, to accelerate TAM expansion, market penetration and margin improvement, Evaluating strategic acquisitions to accelerate growth in adjacent markets as well as cross-selling opportunities (i.e. roll-up potential), utilizing public stock as an acquisition currency for accretive M&A, and Foreign-based and looking to expand their U.S. presence with cross border expansion potential and minimal regulatory trade headwinds, as well as expand their investor base. We believe the most compelling opportunities will be with companies seeking more than just capital they will be seeking a strategic partner to help unlock their next phase of growth. In addition to capital access, our team brings a proven ability to identify follow-on acquisition targets, offer cross-functional operational support, and provide strategic insights to align product positioning with evolving market demand. Competitive Strengths And Differentiators Our sponsor group, led by Adam Dooley (Chairman) and Peter Wright (Chief Executive Officer), combines decades of investment experience and operational leadership across financial markets, public and private capital formation, and corporate development. Our team has demonstrated a consistent ability to identify investment opportunities characterized by strong risk-adjusted returns, often arising from secular tailwinds, industry dislocations, and transformative business model shifts. We intend to identify and partner with a target company that can benefit from our experience navigating complex transactions, scaling operations in the public markets, and positioning businesses for long-term shareholder value creation. Key Differentiators: Public Market Preparedness: We will target businesses that are fundamentally strong yet under-optimized in capital structure or market positioning, and which would benefit from the strategic rigor and liquidity that come with being a public company. These companies will benefit from an enhanced ability to attract top talent, pursue accretive M&A, and access diversified capital sources. 3 Table of Contents Unmatched Network Access: Our collective relationships span the global capital markets ecosystem, including institutional investors, family offices, strategic acquirers, investment bankers, attorneys, and consultants. We expect to source business combinations not only from proprietary channels but also through inbound interest via our reputation and network reach. End-to-End Transactional Expertise: Our management team has experience across the full life cycle of a SPAC from IPO structuring to target identification, transaction execution, capital formation, and post-combination value creation. This includes navigating regulatory processes, managing investor communications, and optimizing governance. Strategic Capabilities: Opportunity Discovery: We have a track record of identifying macro and sector-specific trends early and cultivating proprietary perspectives on competitive landscapes and disruptive business models. Deal Sourcing & Screening: Our team brings deep domain knowledge and pattern recognition to evaluate target companies with compelling fundamentals, high-integrity leadership, and durable competitive advantages. Capital Structuring: We have advised numerous companies on balancing equity and debt financing strategies that support long-term value creation while minimizing dilution and preserving financial flexibility. Post-Combination Positioning: We offer hands-on support to management teams as they transition to the public markets, helping refine their equity narrative, strengthen investor engagement, and position the business for durable public company performance. We believe our disciplined approach, deep sector insight, and proven ability to execute complex transactions set us apart in a competitive SPAC landscape. Our goal is to serve as a long-term strategic partner to our target company, enhancing its growth trajectory and maximizing value for all stakeholders. Management Team Our officers, directors and director nominees are as follows: Name Age Title Adam Dooley 53 Chairman of the Board of Directors Peter Wright 48 Chief Executive Officer, Director Daphne Huang 54 Chief Financial Officer and Treasurer Saurabh Shah 58 Chief Operating Officer Jonathan Rosenzweig 56 Independent Director Tommaso Breschi 50 Independent Director Kevin Beard 51 Independent Director Adam Dooley Chairman Mr. Dooley has served as our Chairman of the Board of Directors since May 1, 2025. Mr. Dooley is an accomplished financial services executive with nearly 30 years of experience in private equity, capital markets, and wealth management. His career spans senior leadership roles in both public and private companies, with a focus on transformation, investor alignment, and long-term value creation. Since January 2021, Mr. Dooley has served as the Founder, Chairman, and Chief Executive Officer of Belay International Corporation, a private equity firm that partners with experienced executives and institutional investors to identify and scale high-growth businesses. He is also the Founder and Managing Principal of Belay Associates, a dedicated SPAC sponsor platform focused on executing business combinations with companies poised for public market success. Prior to founding Belay, Mr. Dooley served as President of PREP Securities, a registered broker-dealer affiliated with a national real estate investment and development company, from December 2019 to December 2020. From February 2014 to December 2019, he was a Managing Director and Partner at CR Capital Group LLC, where he formed joint ventures with leading alternative investment firms to build capital formation platforms targeting the private wealth channel. 4 Table of Contents Earlier in his career, Mr. Dooley held multiple senior roles at MetLife, Inc., including Managing Director and Head of Wealth Management for Europe, the Middle East, and Africa (EMEA) from 2008 to 2012, where he led operations across 12 countries, and Vice President and National Sales Manager for U.S. Individual Retirement Savings from 2012 to 2013. Prior to joining MetLife, Mr. Dooley led The Hartford s United Kingdom business as Vice President and Country Manager, where he was responsible for expanding The Hartford s international platform. Mr. Dooley began his financial career in the Fixed Income Trading Division at Salomon Smith Barney in 1994 and later transitioned to the firm s Private Client Group as an Investment Advisor. Mr. Dooley holds a Bachelor of Science in Business Administration from the University of Southern California, where he studied at the Lloyd Greif Center for Entrepreneurial Studies, and an MBA from IMD Business School in Lausanne, Switzerland. At IMD, he was awarded the International Consulting Project Award for his strategic work with Swiss Life and Bain & Company on the European financial advisory sector. Mr. Dooley is also the author of The Pre-IPO Playbook, a guide for investors evaluating high-growth companies approaching public markets. We believe that Mr. Dooley s prior SPAC experience and his experience in private equity, capital markets, and wealth management make him well qualified to serve as a member of our board of directors. Peter Wright Chief Executive Officer and Director Mr. Wright has served as our Chief Executive Officer since May 1, 2025 and as a member of our Board of Directors since March 27, 2025. Mr. Wright is a capital markets executive with deep experience advising SPACs, growth-stage companies, and institutional investors on public readiness, investor engagement, and transaction execution. Mr. Wright is the Founder and President of Intro-act, LLC, a capital markets advisory firm he established in 2017. Intro-act partners with investment banks and investor relations firms to support both private and public companies with peer benchmarking, investor targeting, and institutional messaging. The firm plays a key role in improving investor readiness particularly for companies approaching or recently completing a business combination. Since 2020, Mr. Wright has also served as President of PartnerCap Securities, LLC, a registered broker-dealer. At PartnerCap, he established the firm s research division and now focuses primarily on investment banking, with an emphasis on structured financings, PIPE transactions, and SPAC capital formation. Earlier in his career, Mr. Wright served as an Analyst and Portfolio Manager at AI Capital Management (2015 2017) and as Managing Director at Cantor Fitzgerald (2014 2015), where he managed institutional sales in Boston. Prior to that, he was Director of Research at Tradition (2010 2011), covering emerging technology. Mr. Wright began his career as an equity analyst with a focus on the semiconductor sector, first on the sell-side at CIBC World Markets (2001 2005), and later on the buy-side at Fidelity Investments (2005 2009). Mr. Wright holds a Bachelor s degree from the Wharton School of Business at the University of Pennsylvania, where he concentrated in finance. We believe that Mr. Wright s deep experience advising SPACs, growth-stage companies, and institutional investors on public readiness, investor engagement, and transaction execution make him well qualified to serve as a member of our board of directors. Daphne Huang Chief Financial Officer and Treasurer Ms. Huang has served as our Chief Financial Officer and Treasurer since May 1, 2025. Ms. Huang has nearly 30 years of financial services and executive experience in public and private companies with strategic expertise in capital markets, growth and transformation. Ms. Huang serves as managing director at Emil Capital Partners, a family office venture fund, a role she has held since March 2025. From July 2022 to August 2025, Ms. Huang served as Chief Financial Officer of Gorilla Technology Group, a NASDAQ traded global security AI company where she played instrumental role in global business expansion, SOX review and implementation, and capital markets strategy. Ms. Huang previously held Chief Financial Officer roles in technology and pharmaceutical industries including GoFor Industries Inc. (August 2021 to July 2022), Taro Pharmaceutical Industries Ltd. (NYSE: TARO) (April 2020 August 2021), and Humanwell USA LLC/PuraCap International LLC, successfully managing global entities and driving strategic growth initiatives. Ms. Huang s experience also includes leadership positions at HSBC Bank, GE Capital Markets, and PricewaterhouseCoopers, building up financial services expertise in a wide variety of industries. 5 Table of Contents Ms. Huang holds an MBA in Finance/Management/International Business from NYU s Leonard N. Stern School of Business and a BBA in Accounting from Baruch College. She is a New York State licensed Certified Public Accountant (inactive). Saurabh Shah Chief Operating Officer Mr. Shah has extensive hands-on SPAC experience and has served as our Chief Operating Officer since May 1, 2025. He has served as Managing Director and Senior Counsel to Belay Associates, a dedicated SPAC sponsor platform focused on sourcing, structuring, and executing business combinations with high-growth companies since 2021. He is a senior securities attorney with deep expertise in financial transactions, investment management, and federal securities laws and regulations. Prior to joining Belay Associates, Mr. Shah served as Chief Compliance Officer and Regulatory Counsel at Hines, a global real estate investment firm, where he was responsible for firm-wide regulatory strategy and compliance oversight beginning in 2016. Mr. Shah previously served as a senior official at the U.S. Securities and Exchange Commission (SEC), where he was Special Counsel to Commissioner Troy Paredes and later Special Counsel to the Director of the Division of Investment Management. At the SEC, Mr. Shah advised on a wide range of enforcement, accounting, examination, and policymaking activities. He was directly involved in writing new rules regulating investment advisers under the Dodd-Frank Wall Street Reform and Consumer Protection Act and was the principal drafter of the SEC s initial regulatory framework for robo-advisors. Before government service, Mr. Shah held senior legal roles at Citigroup, where he advised on strategic acquisitions and the development and distribution of alternative investment products, and with Merrill Lynch, where he negotiated the structure, terms, documentation, and closing of numerous private capital investments in technology companies. Mr. Shah began his legal career in the corporate department of Davis Polk & Wardwell LLP in New York. His practice there focused on capital markets, mergers and acquisitions, and investment management transactions for both domestic and international clients. Mr. Shah earned his Juris Doctor (J.D.) from Harvard Law School, a Master s degree in International Relations from the Fletcher School of Law and Diplomacy at Tufts University, and a Bachelor of Arts in Biology and Political Science from Rice University. Our Independent Directors Jonathan Rosenzweig Director Jonathan Rosenzweig is a solutions-driven and results-oriented leader with strong analytical acumen, talent development expertise, and communication skills. Throughout his career of more than 30 years, he has analyzed and interacted with management teams at both public and private companies of varying sizes. He has forged relationships with a wide range of institutional investors as well, from venture capital to the largest hedge funds and asset managers. In his various capacities, he has helped companies, investors, and securities Analysts to evaluate and to position investment narratives/ideas. A leader of teams both large and small, Jonathan has a proven track record as an exceptional partner who collaborates constructively with colleagues across business lines, regions and functions. He brings keen strategic vision and the adeptness to deliver critical messages to staff, investors, board members, and other core constituents. Innovative process management, disciplined budgeting and expense management, rigorous modeling and forecasting, and an ability to motivate others have driven success in diverse roles and business conditions as well as in both entrepreneurial and large, complex corporate environments. Jonathan currently serves as a fractional CFO with 18 Somerset, a venture capital and consulting firm in the FinTech arena, and Open Exchange, a global leader in multimedia solutions for investor and other communications. In these roles he assists with several functions, such as cash and expense management, modeling and forecasting, evaluating software vendors, enhancing the efficiency of monthly closing processes, and more. From 2022-2024, Jonathan served as a Senior Partner on the Investment Team as well as the CFO at 18 Somerset. He managed the budget, financials, expense practices, and model for the firm as well as the accounting, tax, audit and other core vendor relationships. At the same time, he helped to identify compelling investment opportunities, write investment memos, forecast fundamentals, conduct valuation analyses, and support management teams in optimizing their investor narratives. 6 Table of Contents From 2021-2023, Jonathan was the CFO of Home Plate Acquisition Corp, a Special Purpose Acquisition Company, which he helped to establish and to take public. He met with senior leaders from more than 90 private firms, largely in FinTech though across multiple industries, in pursuit of a final target. Jonathan s responsibilities were broad, including raising capital; sourcing, analyzing, and valuing potential targets; managing expenses and cash flow; producing financial statements in conjunction with the company s partners; communicating with investors and the Board; and collaborating regularly with underwriters, auditors, accountants, attorneys, insurance brokers, and others. From 1993-2020, Jonathan worked in Citigroup s sell-side Equity Research Department, at first as a well-ranked securities Analyst following the Imaging sector. Jonathan spent his last 13 years at Citi as the Head of Americas Equity Research, during which all of the firm s U.S. and Latin America Equity Research staff reported to him. In this role, he formulated and executed the Department s strategy; recruited, developed, coached, and trained talent; oversaw performance for more than 175 employees; managed the budget as well as compensation; and fostered relationships with core institutional clients. Jonathan currently serves as an investor and Strategic Partner to Aiera, an A.I. driven platform used by large financial institutions to power their equity research workflow, and as an Advisor to Stellar Fusion, which provides infrastructure for buy/sell-side analysts as well as corporates to develop and manage customizable financial models. He had served as a Senior Advisor to Eden Global Partners, an advisory and private equity firm founded by David Dwek, in 2022. Mr. Rosenzweig holds a BA in Economics from Duke University as well as an MBA from Duke University. We believe that Mr. Rosenzweig s prior SPAC experience, his experience in venture capital and consulting, financial modeling and forecasting, and identifying investment opportunities, make him well qualified to serve as a member of our board of directors. Tommaso Breschi Director Tommaso Breschi is a strategic, results-driven executive with deep experience in private equity, corporate development, and M&A advisory. Over the past 15+ years, he has led acquisitions, operational transformations, and growth initiatives across the U.S., Europe, and Asia-Pacific, supporting both institutional investors and portfolio companies in unlocking long-term value. From 2017 to 2024, Tommaso served as Global Head of Corporate Development at Sodali & Co., a leading global advisory firm specializing in shareholder services, corporate governance, sustainability, and strategic communications. At Sodali, he played a key role in positioning the company for a successful sale to TPG. Working closely with family office investors, he led the company s M&A strategy, executing multiple cross-border acquisitions and expanding operations into the U.S., UK, and Australia. Following the TPG investment, he partnered with the sponsor team to double the size of the business through strategic acquisitions and operational scaling. Prior to Sodali, Tommaso co-founded MC Square Capital (2015 2017), a merchant bank and broker-dealer focused on advising family offices and mid-market companies on capital raising and M&A transactions. MC Square was formed as a spin-off of 1055 Partners, a boutique investment banking group that operated from 2013 to 2015 within MLV & Co., where Tommaso worked to deliver financial advisory services to institutional investors and family offices across sectors. Earlier in his career, Tommaso worked in private equity at Sciens Capital (2008 2013), where he evaluated investments across business services, industrials, and financial services, and supported portfolio companies with growth planning, performance improvement, and exit strategies. From 2006 to 2008, he worked at Lazard in the M&A group in New York, where he supported clients on mergers, acquisitions, and corporate finance transactions. He first joined as a Summer Associate before transitioning to a full-time role, gaining hands-on experience in cross-border deal execution and strategic advisory across multiple industries. Tommaso began his professional journey at Accenture, where he focused on post-merger integration for pharmaceutical companies, including work on the integrations of Pfizer Warner Lambert and Pfizer Pharmacia in Italy. A collaborative and hands-on leader, Tommaso works closely with management teams, board members, and investors to define strategy, manage performance, and enhance reporting and governance. He is adept at navigating both entrepreneurial and institutional environments and has supported companies in scaling operations, optimizing capital structures, and preparing for successful exits. Tommaso currently serves on the Board of Directors of Modjoul, an AI-driven safety and productivity platform, where he supports financial planning and strategic execution following a growth investment from Solaia Capital. 7 Table of Contents Tommaso holds an MBA from the Kellogg School of Management, is a Chartered Financial Analyst (CFA ) charterholder, and earned a double Master s degree in Engineering from the University of Florence (Environmental Engineering) and the Technical University of Denmark (Civil Engineering). We believe that Mr. Breschi s experience in mergers and acquisitions, evaluating investments, post-merger integration, and financial planning and strategic execution, make him well qualified to serve as a member of our board of directors. Kevin Beard Director Kevin Beard is a seasoned executive in the wealth management industry, bringing over two decades of experience in independent broker-dealer (IBD) growth, acquisitions, and advisor recruitment. He currently serves as Chief Growth Officer and Founding Partner at Atria Wealth Solutions, a modern wealth management holding company he co-founded in 2017. At Atria, Mr. Beard is responsible for the firm s overall growth and acquisition strategy, as well as financial professional recruitment. Under his leadership, Atria has expanded to support over 2,500 financial professionals and manage more than $100 billion in client assets. Prior to founding Atria, Mr. Beard served as Executive Vice President of Recruiting and Acquisition Strategy at AIG Advisor Group, where he developed the firm s advisor recruiting strategy and led the comprehensive planning process for all acquisitions. He also held the position of Senior Vice President of Corporate Strategy at Royal Alliance Associates subsidiary of AIG Advisory Group and the largest IBD within the AIG Network. Earlier in his career, Mr. Beard was Regional Director at Rehmann and co-founded two firms: Innovative Advanced Resources, a specialized high-net-worth investment distribution and business advisory firm, and Beard Management Inc., a wealth management consulting firm. At Innovative resources, Mr. Beard was instrumental in assisting and developing some of the top accounting firms entr e into wealth management. Mr. Beard is actively involved in industry and philanthropic initiatives. He serves as Northeast Ohio Corporate Chair for the Arthritis Foundation, Secretary for the Financial Services Institute (FSI) Marketing Council, and is a member of the Diversity and Inclusion Committee for the Bank Insurance & Securities Association (BISA). In recognition of his leadership, he was named to Investment News Hot List 2023 and received the Wealth Solutions Report Pathfinder Award as one of the top Black leaders in wealth management. Mr. Beard holds a Bachelor of Arts in Finance from Kent State University. We believe that Mr. Beard s experience in acquisition strategy, comprehensive planning processes for acquisitions, investment distribution and business advisory work, make him well qualified to serve as a member of our board of directors. Together, we believe our directors bring additional expertise that will enhance our ability to identify and execute our initial business combination, and may enhance our ability to execute upon various value creation initiatives after successful completion of our business combination. Notwithstanding the foregoing, past experience or performance of our management team and their respective affiliates is not a guarantee of either (1) our ability to successfully identify and execute a business combination or (2) success with respect to any business combination that we may consummate. You should not rely on the historical record of our management team or their respective affiliates as indicative of future performance. Our management team and their respective affiliates have been involved with a large number of public and private companies in addition to those identified above, not all of which have achieved similar performance levels. See Risk Factors Past performance by our management team and their affiliates may not be indicative of future performance of an investment in the company. For a complete list of our executive officers and entities for which a conflict of interest may or does exist between such officers and the company, please refer to Management Conflicts of Interest. Prior SPAC Experience Adam Dooley SPAC Leadership and Sponsor Execution Mr. Dooley is the Founder, Chairman, and Chief Executive Officer of Belay International Corporation, a private equity and investment platform that partners with experienced operators and institutional capital to identify and scale high-potential businesses. He is also the Founder and Managing Principal of Belay Associates, a SPAC sponsor platform focused on executing business combinations with companies well-positioned for long-term growth and public market success. 8 Table of Contents Mr. Dooley is also the Chief Executive Officer and Chairman of Everest Consolidator Acquisition Corporation, a special purpose acquisition company ( Everest ). Everest completed its IPO in November 2021. On May 19, 2023, Everest entered into a business combination agreement with Unifund Financial Technologies, Inc. ( Unifund ), which agreement was terminated by Everest on October 1, 2024. On November 22, 2024, at a special meeting of shareholders, the Everest shareholders approved a proposal to amend Everest s charter to extend the period by which Everest must complete a business combination from November 23, 2024 to May 23, 2025. In connection with that meeting, Everest shareholders holding 2,817,827 public shares, representing approximately 99.02% of the Company s outstanding public shares, exercised their right to redeem their shares for a pro rata portion of the funds in Everest s trust account. On November 18, 2024, DLA, LLC ( DLA ) filed a lawsuit against Equiniti Trust Company, LLC (the Everest Trustee ) for unpaid fees in connection with the services DLA provided in the proposed business combination between Everest and Unifund. In connection with this litigation (Supreme Court of New York, County of New York, Index No. 655723/2024), the court, on November 1, 2024, entered a temporary injunction order which restrained the Everest Trustee from distributing from the Everest trust account amounts that would leave the balance of such account below the approximately $3 million that DLA alleges it is owed. Everest was not named as a defendant in this lawsuit. On November 20, 2024, DLA filed a lawsuit against Everest and its sponsor in Superior Court of New Jersey (Law Division: Essex County, Docket No. ESX-L-D008097-24) for such allegedly owed fees and on December 3, 2024, the New Jersey court granted a preliminary injunction. While Everest continues to believe DLA s allegations are baseless and that DLA has no valid claim against the funds in the Everest trust account, due to the injunctions, the Everest Trustee is unable to process redemption requests and Everest is currently prohibited by the court from instructing the Everest Trustee to process redemption requests. On March 21, 2025 Everest signed a letter of intent with Accredited Solutions, Inc., a technology-focused holding company, for a business combination between the two companies. Mr. Dooley brings nearly 30 years of experience across private equity, capital markets, and strategic advisory. Through Belay Associates, he has been responsible for the full lifecycle of SPAC execution, including sponsor formation, investment thesis development, target identification, transaction structuring, capital formation, and post-combination readiness. He has advised both domestic and international businesses on accessing U.S. public markets and worked closely with institutional investors to ensure alignment around growth strategy, governance, and value creation. Mr. Dooley is also the author of The Pre-IPO Playbook, a guide designed to help investors identify and evaluate high-growth companies preparing to access public capital markets. His insights into public company readiness, investor engagement, and strategic positioning complement his practical experience as a SPAC sponsor and operator. Peter Wright SPAC Advisory and Capital Markets Expertise Mr. Wright, our Chief Executive Officer, has advised dozens of SPACs and target companies across all phases of the SPAC transaction lifecycle. His experience includes supporting sponsor groups with target identification, deal structuring, and capital raising including risk capital, PIPE equity, and structured financing as well as preparing companies for the operational and investor-facing demands of being publicly traded. Mr. Wright is the Founder and President of Intro-act, a capital markets advisory firm that partners with investment banks and investor relations professionals to enhance institutional engagement and investor readiness for both private and public companies. Through data-driven benchmarking, targeting, and messaging services, Intro-act plays a critical role in improving market positioning for companies entering or operating in the public markets. In addition, Mr. Wright serves as President of PartnerCap Securities, LLC, a registered broker-dealer, where he has advised on numerous SPAC capital raises and strategic transactions. Mr. Wright s end-to-end SPAC experience includes: Pre-Combination: Sourcing and evaluating acquisition candidates; Business Combination: Structuring transactions and securing aligned capital; Post-Combination: Institutional engagement, messaging refinement, and ongoing market support. 9 Table of Contents Jonathan Rosenzweig Prior SPAC Experience Jonathan Rosenzweig served as Chief Financial Officer and Secretary and a director of Home Plate Acquisition Corporation 1, ( Home Plate ), a special purpose acquisition company from March 2021 until November 2023. Home Plate completed its IPO in September 2021. In March 2023, Home Plate and Heidmar Inc., a company organized and existing under the laws of Marshall Islands entered into a business combination agreement for a merger between the two companies. Because the merger was not able to be completed by October 2023, the time period required by Home Plate s charter to consummate a business combination, the parties terminated the agreement and Home Plate was liquidated resulting in 100% redemption of the public shares. Collectively, Mr. Dooley, Mr. Wright and Mr. Rosenzweig bring extensive SPAC execution capabilities, a disciplined approach to target selection, and a strong track record of delivering shareholder value in the public markets. Business Combination Criteria We have established a set of strategic, non-exclusive criteria to guide our evaluation of potential business combination targets. While we intend to identify a target that aligns with many of the attributes outlined below, we may ultimately pursue an initial business combination with a company that does not meet all of these guidelines, provided our management believes the opportunity offers strong long-term value potential for our shareholders. We intend to focus our evaluation on businesses that demonstrate some or all of the following characteristics: Properly Sized: Seeking a company with an enterprise value of $500 million to $2 billion, with a total addressable market greater than $1 billion and annual sales of $75-350 million. Positioned in a Progressive Industry: Operates within a high-growth, innovation-driven segment of its broader sector benefiting from structural tailwinds and disruptive trends that drive outsized demand for its products or services. Market Leadership: Holds or is capable of attaining a leading position within its category or sub-sector, supported by a sizable addressable market with potential to scale as a public company. Clear Growth Trajectory: Demonstrates a well-defined and executable growth plan, encompassing both organic and strategic (inorganic) expansion, with a track record or roadmap to sustain high-growth performance post-combination, specifically with potential to generate 255%+ growth. Scalable Business Model: Exhibits strong customer adoption, with operating leverage that supports margin expansion and reduced capital intensity as the business grows. More specifically, companies with recurring, or predictable sales at attractive margins and favorable customer acquisition economics. Sound Capitalization: Maintains a healthy balance sheet and financial profile that supports execution of its growth strategy without requiring significant additional capital in the near term. Strategic Differentiation: Offers a product or service with clear competitive advantages such as proprietary technology, customer loyalty, or cost leadership that collectively establish a defensible market position and sustainable competitive moat. Near-Term Trading Catalysts: Has identifiable upcoming milestones such as product launches, key partnerships, or market expansions that can sustain investor engagement and enhance the company s valuation narrative following the business combination. High-Caliber Management Team: Led by experienced executives with a proven ability to scale operations, attract and retain top talent, and deliver on strategic objectives. We seek teams that are committed to aligning with public shareholders and whose liquidity needs can be appropriately managed within a public company framework. Leadership should possess strong industry expertise and maintain significant equity. Public Company Readiness: Public company worthy, ready and eager possesses or can readily establish the governance, reporting, compliance, and operational infrastructure required to operate as a public company, with the added benefit of leveraging the public markets to raise growth capital, execute acquisitions, and optimize cost of capital. 10 Table of Contents Value Creation from the Business Combination: Has the potential to realize immediate and long-term value from partnering with us, including access to our strategic guidance, capital resources, and extensive network of industry relationships, investors, and advisors. These criteria serve as a general framework for our opportunity assessment and are not intended to be exhaustive. Our management team may consider additional factors it deems relevant in evaluating potential targets. Should we pursue a business combination with a target that does not meet one or more of the criteria described above, we will disclose this in our shareholder communications either in the proxy solicitation or in the tender offer materials filed with the SEC in connection with such transaction. Acquisition Process We believe rigorous due diligence is fundamental to identifying and executing a successful business combination particularly in progressive, innovation-driven industries where emerging companies may face both rapid growth and evolving challenges. Our approach to evaluating potential targets will be comprehensive, disciplined, and data-driven, leveraging the collective expertise of our management team and board of directors. We are committed to maintaining an active deal pipeline. This pipeline will include: 1) initial screening on 150 target companies, 2) having preliminary discussions with 50 target companies, 3) facilitating significant due diligence on 10-15 target companies, and 4) having advanced negotiations with 2-3 target companies. Our due diligence process may include, but is not limited to: In-depth management presentations and interviews with key executives and team members; Analysis of historical and projected financial statements; Comprehensive review of corporate documentation and legal structure; Market research and competitive positioning analysis; Consultations with third-party industry experts, customers, and suppliers; Site visits and operational reviews, where applicable; Evaluation of environmental, social, and governance (ESG) factors; Assessment of organizational readiness for public markets, including internal controls and reporting infrastructure. Our team brings decades of experience sourcing, analyzing, and structuring transactions in progressive growth industries. This experience provides a strong foundation to evaluate both the qualitative and quantitative aspects of potential targets, assess the alignment between business fundamentals and public market expectations, and determine a company s intrinsic value and growth potential. We anticipate that in many cases we will already have a working knowledge of the target s industry dynamics, customer base, and competitive positioning enabling us to evaluate opportunities efficiently and with conviction. Upon identifying a suitable target, we will proceed to negotiate transaction terms, conduct confirmatory due diligence, and structure a business combination that aligns the interests of all stakeholders. Initial Business Combination We are not presently engaged in, and we will not engage in, any operations for an indefinite period of time following this offering. We intend to effectuate our initial business combination using cash from the proceeds of this offering and the private placement of the private placement units, the proceeds of the sale of our shares in connection with our initial business combination (including pursuant to forward purchase agreements or backstop agreements we may enter into following the consummation of this offering or otherwise), shares issued to the owners of the target, debt issued to bank or other lenders or the owners of the target, other securities issuances, or a combination of the foregoing. We may seek to complete our initial business combination with a company or business that may be financially unstable or in its early stages of development or growth, which would subject us to the numerous risks inherent in such companies and businesses. 11 Table of Contents We will provide our public shareholders with the opportunity to redeem all or a portion of their Class A ordinary shares upon the completion of our initial business combination either (i) in connection with a general meeting called to approve the business combination or (ii) without a shareholder vote by means of a tender offer. If we seek shareholder approval, we will complete our initial business combination only if we receive an ordinary resolution under Cayman Islands law and our amended and restated memorandum and articles of association, which requires the affirmative vote of at least a majority of the votes cast by holders of ordinary shares as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at the applicable general meeting of the company, voting together as a single class. The decision as to whether we will seek shareholder approval of a proposed business combination or conduct a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would require us to seek shareholder approval under applicable law or stock exchange listing requirement. We will have 18 months from the closing of this offering (or 24 months if we have executed a definitive agreement for an initial business combination within 18 months from the closing of this offering) to consummate our initial business combination. If we anticipate that we may be unable to consummate our initial business combination within such 18-month (or 24-month), we may seek shareholder approval to amend our amended and restated memorandum and articles of association to extend the date by which we must consummate our initial business combination. If we seek shareholder approval for an extension, holders of public shares will be offered an opportunity to redeem their shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (net of permitted withdrawals), divided by the number of then issued and outstanding public shares, subject to applicable law. While we do not currently intend to seek shareholder approval to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to consummate an initial business combination if we do not complete our initial business combination within the completion window, we may elect to do so in the future. If we are unable to complete our initial business combination within 18 months from the closing of this offering (or 24 months if we have executed a definitive agreement for an initial business combination within 18 months from the closing of this offering) and do not extend our time to complete a business combination, the founder shares and private placement units would expire worthless. There is no limit on the number of extensions that we may seek; however, we do not expect to extend the time period to consummate our initial business combination beyond 36 months from the closing of this offering. If we are unable to complete our initial business combination within 18 months from the closing of this offering (or 24 months if we have executed a definitive agreement for an initial business combination within 18 months from the closing of this offering), or by such earlier liquidation date as our board of directors may approve, from the closing of this offering, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (net of permitted withdrawals and up to $100,000 of interest income to pay dissolution expenses), divided by the number of then issued and outstanding public shares, subject to applicable law and certain conditions as further described herein. We expect the pro rata redemption price to be approximately $10.00 per public share (regardless of whether or not the underwriters exercise their over-allotment option), without taking into account any interest or other income earned on such funds. However, we cannot assure you that we will in fact be able to distribute such amounts as a result of claims of creditors. Nasdaq rules require that we must complete one or more business combinations having an aggregate fair market value of at least 80% of the value of the assets held in the trust account (excluding the contingent, deferred underwriting commissions and taxes payable on the interest earned on the trust account). Our board of directors will make the determination as to the fair market value of our initial business combination. If our board of directors is not able to independently determine the fair market value of our initial business combination, we will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions with respect to the satisfaction of such criteria. While we consider it likely that our board of directors will be able to make an independent determination of the fair market value of our initial business combination, it may be unable to do so if it is less familiar or experienced with the business of a particular target or if there is a significant amount of uncertainty as to the value of the target s assets or prospects. Additionally, pursuant to Nasdaq rules, any initial business combination must be approved by a majority of our independent directors. We anticipate structuring our initial business combination so that the post transaction company in which our public shareholders own shares will own or acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination such that the post transaction company owns or acquires less than 100% of such interests or assets of the target business in order to meet certain objectives of the target 12 Table of Contents management team or shareholders or for other reasons, but we will only complete such business combination if the post transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act. Even if the post transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post transaction company, depending on valuations ascribed to the target and us in the business combination. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding capital stock, shares or other equity interests of a target. In this case, we would acquire a 100% controlling interest in the target. However, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our issued and outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post transaction company, the portion of such business or businesses that is owned or acquired is what will be taken into account for purposes of the 80% of net assets test described above. If the business combination involves more than one target business, the 80% of net assets test will be based on the aggregate value of all of the target businesses. We are not prohibited from pursuing an initial business combination with a company that is affiliated with our sponsor, officers or directors, or non-managing sponsor investors, or completing the business combination through a joint venture or other form of shared ownership with our sponsor, officers or directors or non-managing sponsor investors. In the event we seek to complete our initial business combination with a company that is affiliated (as defined in our amended and restated memorandum and articles of association) with our sponsor, officers or directors, or non-managing sponsor investors we, or a committee of independent directors, will obtain an opinion from an independent investment banking firm or another independent entity that commonly renders valuation opinions, stating that the consideration to be paid by us in such an initial business combination is fair to our company from a financial point of view. We are not required to obtain such an opinion in any other context. Members of our management team and our independent directors will directly or indirectly own founder shares and/or private placement units following this offering and, accordingly, may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. The low price that our sponsor, executive officers and directors (directly or indirectly) paid for the founder shares (approximately $0.004 per founder share) creates an incentive whereby our officers and directors could potentially make a substantial profit even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. If we are unable to complete our initial business combination within 18 months from the closing of this offering (or 24 months if we have executed a definitive agreement for an initial business combination within 18 months from the closing of this offering), or by such earlier liquidation date as our board of directors may approve, the founder shares and private placement units may expire worthless, except to the extent they receive liquidating distributions from assets outside the trust account, which could create an incentive for our sponsor, executive officers and directors to complete a transaction even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. Accordingly, if any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such other entity, subject to their fiduciary duties under Cayman Islands law. Our amended and restated memorandum and articles of association provide that, to the fullest extent permitted by law: (i) no individual serving as a director or an officer, among other persons, shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us, and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which (a) may be a corporate opportunity for any director or officer, on the one hand, and us, on the other or (b) the presentation of which would breach an existing legal obligation of a director or officer to any other entity. We do not believe, however, that the fiduciary duties or contractual obligations of our officers or directors will materially affect our ability to complete our initial business 13 Table of Contents combination. If any of our officers or directors becomes aware of a business combination opportunity which is suitable for an entity to which he or she has then current fiduciary or contractual obligations, he or she will honor his or her fiduciary or contractual obligations to present such business combination opportunity to such other entity, subject to their fiduciary duties under Cayman Islands law. In addition, our sponsor and our officers and directors may sponsor or form other special purpose acquisition companies similar to ours or may pursue other business or investment ventures during the period in which we are seeking an initial business combination. As a result, our sponsor, officers and directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other special purpose acquisition company with which they may become involved. Any such companies, businesses or investments may present additional conflicts of interest in pursuing an initial business combination target. Our sponsor, officers and directors have complete discretion, subject to applicable fiduciary duties, as to which blank check company they choose to pursue a business combination and the order in which they pursue business combinations for any of their existing or future blank check companies. However, we do not believe that any such potential conflicts would materially affect our ability to complete our initial business combination. Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the Securities and Exchange Commission (the SEC ) to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended (the Exchange Act ). As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. Additional Financing We have not selected any specific business combination target but intend to target businesses with enterprise values that are greater than we could acquire with the net proceeds of this offering and the sale of the private placement units. As a result, if the cash portion of the purchase price exceeds the amount available from the trust account, net of amounts needed to satisfy any redemption by public shareholders, we may be required to seek additional financing to complete such proposed initial business combination. If we raise additional funds through equity or convertible debt issuances, our public shareholders may suffer significant dilution and these securities could have rights that rank senior to our public shares. If we raise additional funds through the incurrence of indebtedness, such indebtedness would have rights that are senior to our equity securities and could contain covenants that restrict our operations. Further, as described above, due to the anti-dilution rights of our founder shares, our public shareholders may incur material dilution. We do not have any arrangements in place for such additional financing and we cannot assure you that such financing will be available on acceptable terms, if at all. To the extent that additional financing proves to be unavailable when needed to complete our initial business combination, we would be compelled to either restructure the transaction or abandon that particular business combination and seek an alternative target business candidate. Further, we may be required to obtain additional financing in connection with the closing of our initial business combination for general corporate purposes, including for maintenance or expansion of operations of the post-transaction businesses, the payment of principal or interest due on indebtedness incurred in completing our initial business combination, or to fund the purchase of other companies. Sponsor Information Our sponsor is a Delaware limited liability company, which was recently formed to invest in our company. Although our sponsor is permitted to undertake any activities permitted under the Delaware Limited Liability Company Act and other applicable law, our sponsor s business is focused on investing in our company. Subject to each non-managing sponsor investor purchasing, through the sponsor, the private placement units allocated to it in connection with the closing of this offering, the sponsor will issue Class A membership units at a nominal purchase price ($0.004) to the non-managing sponsor investors representing interests in an aggregate of 2,620,000 founder shares (or up to 5,620,000 founder shares in certain circumstances) held by the sponsor. Non-managing sponsor investors will hold their interests in the private placement units through the Class B membership units in the sponsor. Non-managing sponsor investors will have no right to control the sponsor or participate in any decision regarding the disposal of any security held by the sponsor, or otherwise. 14 Table of Contents The following table sets forth the payments to be received by our sponsor and its affiliates from us prior to or in connection with the completion of our initial business combination and the securities issued and to be issued by us to our sponsor or its affiliates: Entity/Individual Amount of Compensation to be Received or Securities Issued or to be Issued Consideration Paid or to be Paid McKinley Partners LLC 5,489,655 Class B ordinary shares(1)(2) $0.004 per share Anti-dilution protection upon conversion into Class A ordinary shares at a greater than one-to-one ratio Issuance of the Class A ordinary shares issuable in connection with the conversion of the founder shares on a greater than one-to-one basis upon conversion 420,000 private placement units(3)(4) $4,200,000 (which includes $3,700,000 in cash and the Private Placement Units Note) Up to $185,000 Repayment of loans made to us by our sponsor to cover offering-related and organizational expenses. $10,000 per month Payment to our sponsor for technology, software, computer systems, administrative support, secretarial services and infrastructure; Up to $1,500,000 in working capital loans (in addition to the securities issuable pursuant to the Private Placement Units Note) may be convertible into private placement units at a price of $10.00 per unit Working capital loans to finance transaction costs in connection with an intended initial business combination. Reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination Services in connection with identifying, investigating and completing an initial business combination. ____________ (1) Assumes no exercise of the over-allotment option and the full forfeiture of 853,448 shares that are subject to forfeiture by our sponsor depending on the extent to which the underwriters over-allotment option is exercised. Of the Class B ordinary shares, the non-managing sponsor investors own, indirectly through the purchase of non-managing membership interests, 2,620,000 founder shares, which were purchased for approximately $0.004 per share. In addition, several of our officers and directors own an indirect interest the founder shares through membership interests in our sponsor. The non-managing sponsor member will have no right to vote the founder shares that it holds indirectly through its Class A membership interests in the sponsor. (2) Our sponsor currently owns an aggregate of 6,543,103 Class B ordinary shares, which were purchased for an aggregate of $25,000 (or approximately $0.004 per share), up to 853,448 of which will be surrendered to us for no consideration after the closing of this offering depending on the extent to which the underwriters over-allotment option is exercised (3) The non-managing sponsor investors have expressed an interest to purchase, indirectly through the purchase of non-managing membership interests, an aggregate of 327,500 of the 420,000 private placement units being purchased by our sponsor at a price of $10.00 per unit ($3,275,000 in the aggregate) in a private placement that will close simultaneously with the closing of this offering. The purchase of the non-managing sponsor membership interests is not contingent upon the participation in this offering or vice versa. (4) A total of 50,000 of these units will be purchased by a non-interest bearing, unsecured promissory note that we will issue to the sponsor simultaneously with the closing of this offering in the principal amount of $500,000 (the Private Placement Units Note ), which we may draw down at any time and from time to time in our sole discretion. At the closing of our initial business combination, we will cancel the number of private placement units proportional to the amount not drawn under the Private Placement Units Note and the Private Placement Units Note will be canceled. The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of our initial business combination or earlier at the option of the holder, on a one-for-one basis, subject to adjustment for share splits, share capitalizations, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein and in our amended and restated memorandum and articles of association. In the case that additional Class A ordinary shares, 15 Table of Contents or equity-linked securities, are issued or deemed issued in excess of the amounts sold in this offering and related to the closing of our initial business combination, the ratio at which the Class B ordinary shares shall convert into Class A ordinary shares will be adjusted (unless the holders of a majority of the issued and outstanding Class B ordinary shares agree to waive such anti-dilution adjustment with respect to any such issuance or deemed issuance) so that the number of Class A ordinary shares issuable upon conversion of all Class B ordinary shares will equal, in the aggregate, 20% of the sum of all ordinary shares issued and outstanding upon completion of this offering, including pursuant to the Over-Allotment Options, plus all Class A ordinary shares issued or deemed issued, or issuable upon the conversion or exercise of any equity-linked securities issued or deemed issued in connection with or in relation to our initial business combination, excluding any shares or equity-linked securities issued, or to be issued, to any seller in our initial business combination or any private placement-equivalent securities issued to our sponsor or its affiliates upon conversion of loans made to us. Holders of founder shares may also elect to convert their Class B ordinary shares into an equal number of Class A ordinary shares, subject to adjustment as provided above, at any time. The term equity-linked securities refers to any debt or equity securities that are convertible, exercisable or exchangeable for our Class A ordinary shares issued in a financing transaction in connection with our initial business combination, including but not limited to a private placement of equity or debt. Securities could be deemed issued for purposes of the conversion adjustment if such shares are issuable upon the conversion or exercise of convertible securities or similar securities. In addition, because of the anti-dilution protection in the founder shares, any equity or equity-linked securities issued or deemed issued in connection with our initial business combination would be disproportionately dilutive to our Class A ordinary shares. The low price that our sponsor, executive officers and directors (directly or indirectly) paid for the founder shares creates an incentive whereby our officers and directors could potentially make a substantial profit even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. If we are unable to complete our initial business combination within the completion window, or by such earlier liquidation date as our board of directors may approve, the founder shares, private placement shares and private placement rights will be worthless, except to the extent they receive liquidating distributions from assets outside the trust account. Additionally, we will repay up to $185,000 in loans made to us by our sponsor to cover offering-related and organizational expenses. We will repay any loans which may be made by our sponsor or an affiliate of our sponsor or certain of our directors and officers to finance transaction costs in connection with an intended initial business combination; up to $1,150,000 of such loans may be convertible into private placement units at a price of $10.00 per unit at the option of the lender. The conversion of the working capital loans into units may result in a material dilution to the equity interest of investors in this offering. For example, if $1,150,000 of loans were made and converted into units, it would result in the issuance of an additional 126,500 ordinary shares at the closing of the business combination (115,000 ordinary shares underlying the units and 11,500 ordinary shares issuable upon conversion of the rights underlying the units). Because our sponsor acquired the founder shares at a nominal price (an aggregate of $25,000, or approximately $0.004 per founder share), our public shareholders will incur immediate and substantial dilution upon the closing of this offering. See the section titled Risk Factors Risks Relating to our Securities The nominal purchase price paid by our sponsor for the founder shares may result in significant dilution to the implied value of your public shares upon the consummation of our initial business combination, and our sponsor is likely to make a substantial profit on its investment in us in the event we consummate an initial business combination, even if the business combination causes the trading price of our ordinary shares to materially decline. Pursuant to a letter agreement to be entered with us, each of our sponsor, directors and officers has agreed to restrictions on its ability to transfer, assign, or sell the founder shares and private placement units, as summarized in the table below. 16 Table of Contents Subject Securities Expiration Date Natural Persons and Entities Subject to Restrictions Exceptions to Transfer Restrictions Founder Shares The earlier of (i) one year after the completion of our initial business combination or (ii) the date following the completion of our initial business combination on which we complete a liquidation, merger, share exchange or other similar transaction that results in all of our shareholders having the right to exchange their ordinary shares for cash, securities or other property. Notwithstanding the foregoing, if the closing price of our Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after our initial business combination, the founder shares will be released from the lockup. McKinley Partners LLC Adam Dooley Peter Wright Daphne Huang Saurabh Shah Jonathan Rosenzweig Tommaso Breschi Kevin Beard Transfers permitted (a) to our officers, directors, advisors or consultants, any affiliate or family member of any of our officers, directors, advisors or consultants, any members or partners of the sponsor or their affiliates and funds and accounts advised by such members or partners, any affiliates of the sponsor, or any employees of such affiliates, (b) in the case of an individual, as a gift to such person s immediate family or to a trust, the beneficiary of which is a member of such person s immediate family, an affiliate of such person or to a charitable organization; (c) in the case of an individual, by virtue of laws of descent and distribution upon death of such person; (d) in the case of an individual, pursuant to a qualified domestic relations order; (e) by private sales or transfers made in connection with any forward purchase agreement or similar arrangement, in connection with an extension of the completion window or in connection with the consummation of a business combination at prices no greater than the price at which the shares or units were originally purchased; (f) pro rata distributions from our sponsor to its respective members, partners or shareholders pursuant to our sponsor s limited liability company agreement or other charter documents; (g) by virtue of the laws of the Cayman Islands or our sponsor s limited liability company agreement upon dissolution of our sponsor, (h) in the event of our liquidation prior to our consummation of our initial business combination; (i) in the event that, subsequent to our consummation of an initial business combination, we complete a liquidation, merger, share exchange or other similar transaction which results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property or (j) to a nominee or custodian of a person or entity to whom a transfer would be permissible under clauses (a) through (g); provided, however, that in the case of clauses (a) through (g) and clause (j) these permitted transferees must enter into a written agreement agreeing to be bound by these transfer restrictions and the other restrictions contained in the letter agreements 17 Table of Contents Subject Securities Expiration Date Natural Persons and Entities Subject to Restrictions Exceptions to Transfer Restrictions Private placement units 30 days after the completion of our initial business combination McKinley Partners LLC Same as above Founder Shares and private placement units 180 days after the date of this prospectus McKinley Partners LLC Adam Dooley Peter Wright Daphne Huang Saurabh Shah Jonathan Rosenzweig Tommaso Breschi Kevin Beard We may (1) issue and sell the private placement units; (2) issue and sell the additional units to cover our underwriters over-allotment option (if any); (3) register with the SEC pursuant to an agreement to be entered into concurrently with the issuance and sale of the securities in this offering, the resale of the private placement units and the Class A ordinary shares underlying the private placement units and the founder shares; and (4) issue securities in connection with our initial business combination. However, we are permitted to transfer founder shares to any current or future independent director of the company (as long as such current or future independent director transferee is subject to the letter agreement, filed herewith, or executes an agreement substantially identical to the letter agreement, as applicable to directors and officers at the time of such transfer; and as long as, to the extent any Section 16 reporting obligation is triggered as a result of such transfer, any related Section 16 filing includes a practical explanation as to the nature of the transfer). In addition, in order to facilitate our initial business combination or for any other reason determined by our sponsor in its sole discretion, our sponsor may surrender or forfeit, transfer or exchange our founder shares, private placement units or any of our other securities, including for no consideration, as well as subject any such securities to earn-outs or other restrictions, or otherwise amend the terms of any such securities or enter into any other arrangements with respect to any such securities. Corporate Information Our executive offices are located at 75 Second Ave., Suite 605, Needham, MA 02494 and our telephone number is 617-671-5148. We are a Cayman Islands exempted company. Exempted companies are Cayman Islands companies conducting business mainly outside the Cayman Islands and, as such, are exempted from complying with certain provisions of the Companies Law. As an exempted company, we have applied for and received a tax exemption undertaking from the Cayman Islands government that, in accordance with Section 6 of the Tax Concessions Act (As Revised) of the Cayman Islands, for a period of 20 years from the date of the undertaking, no law which is enacted in the Cayman Islands imposing any tax to be levied on profits, income, gains or appreciations will apply to us or our operations and, in addition, that no tax to be levied on profits, income, gains or appreciations or which is in the nature of estate duty or inheritance tax will be payable (i) on or in respect of our shares, debentures or other obligations or (ii) by way of the withholding in whole or in part of a payment of dividends or other distribution of income or capital by us to our shareholders or a payment of principal or interest or other sums due under a debenture or other obligation of us. We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the 18 Table of Contents auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that are held by non-affiliates exceeds $700 million as of the prior June 30th, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates is equal to or exceeds $250 million as of the prior June 30, or (2) our annual revenues equaled or exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates is equal to or exceeds $700 million as of the prior June 30. Our amended and restated memorandum and articles of association will provide that, to the fullest extent permitted by applicable law: (i) no individual serving as a director or an officer shall have any duty, except and to the extent expressly assumed by contract, to refrain from engaging directly or indirectly in the same or similar business activities or lines of business as us, and (ii) we renounce any interest or expectancy in, or in being offered an opportunity to participate in, any potential transaction or matter which may be a corporate opportunity for any director or officer, on the one hand, and us, on the other. The purpose for the surrender of corporate opportunities is to allow officers, directors or other representatives with multiple business affiliations to continue to serve as an officer of our company or on our board of directors. Our officers and directors may from time to time be presented with opportunities that could benefit both another business affiliation and us. In the absence of the corporate opportunity waiver in our charter, certain candidates would not be able to serve as an officer or director. We believe we substantially benefit from having representatives who bring significant, relevant and valuable experience to our management, and, as a result, the inclusion of the corporate opportunity waiver in our amended and restated memorandum and articles of association will provide us with greater flexibility to attract and retain the officers and directors that we feel are the best candidates. Finally, after completion of this offering and prior to the consummation of a business combination, only holders of our Class B ordinary shares will have the right to vote on the appointment or removal of directors. As a result, Nasdaq will consider us to be a controlled company within the meaning of Nasdaq corporate governance standards. Under Nasdaq corporate governance standards, a company of which more than 50% of the voting power for the appointment of directors is held by an individual, group or another company is a controlled company and may elect not to comply with certain corporate governance requirements. We currently do not intend to rely on the controlled company exemption, but may do so in the future. Accordingly, if we choose to do so, you will not have the same protections afforded to shareholders of companies that are subject to all of the Nasdaq corporate governance requirements. 19 Table of Contents
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+Prospectus Summary Summary of Risk Factors, and Risk Factors Risks Relating to Doing Business in China To the extent cash or assets in the business are in the PRC or Hong Kong or a PRC or Hong Kong entity, the funds or assets may not be available to fund operations or for other use outside of the PRC or Hong Kong due to interventions in or the imposition of restrictions and limitations on the ability of us or our subsidiaries by the PRC government to transfer cash or assets, and Risk Factors Risks Relating to Doing Business in China Mingteng International is a holding company and will rely on dividends paid by our PRC Subsidiaries for our cash needs. Any limitation on the ability of our PRC Subsidiaries to make dividend payments to us, or any tax implications of making dividend payments to us, could limit our ability to pay our parent company expenses or pay dividends to holders of our Ordinary Shares. As a holding company, we may rely on dividends and other distributions of equity paid by our subsidiaries in the PRC, for our cash and financing requirements. If any of our PRC Subsidiaries incurs debt on its own behalf in the future, the instruments governing such debt may restrict their ability to pay dividends to us. Mingteng International is permitted under the laws of the Cayman Islands to provide funding to our subsidiary incorporated in Hong Kong through loans or capital contributions without restrictions on the amount of the funds. Our subsidiaries are permitted under the respective laws of Hong Kong to provide funding to Mingteng International through dividend distribution without restrictions on the amount of the funds. There are no restrictions on dividend transfers from Hong Kong to the Cayman Islands. Current PRC regulations permit Wuxi Ningteng Intelligent Manufacturing Co., Ltd. ( Ningteng WFOE ) to pay dividends to Mingteng International only out of its accumulated profits, if any, determined in accordance with Chinese accounting standards and regulations. The transfer of funds among companies is subject to the Provisions of the Supreme People s Court on Several Issues Concerning the Application of Law in the Trial of Private Lending Cases (2020 Revision, the Provisions on Private Lending Cases ), which was implemented on August 20, 2020 to regulate the financing activities between natural persons, legal persons and unincorporated organizations. As advised by our PRC counsel, Jiangsu Junjin Law Firm, the Provisions on Private Lending Cases does not prohibit using cash generated from one subsidiary to fund another subsidiary s operations. We have not been notified of any other restriction which could limit our PRC Subsidiaries ability to transfer cash between PRC Subsidiaries. On September 30, 2022, Mingteng International declared cash dividends of RMB 2.5 million (approximately $0.35 million) to our shareholders which were paid by Wuxi Mingteng Mould in December 2022. Besides this dividend, we have not made any dividends or distributions to investors in order to retain more cash flow to expand business. And no investors have made transfers, dividends, or distributions to Mingteng International or its subsidiaries. Also, as of the date of this prospectus, no cash generated from one subsidiary is used to fund another subsidiary s operations and we do not anticipate any difficulties or limitations on our ability to transfer cash between subsidiaries. See Prospectus Summary Transfers of Cash to and from Our Subsidiaries on page 14 and Consolidated Financial Statements starting from page F-1. Investing in our Ordinary Shares involves a high degree of risk, including the risk of losing your entire investment. See the section titled Risk Factors herein, beginning on page 20. We are an emerging growth company under the federal securities laws and will be subject to reduced public company reporting requirements. Please read Prospectus Summary Implications of Being an Emerging Growth Company beginning on page 12 of this prospectus for more information. We are a foreign private issuer as defined under the U.S. federal securities laws and, as such, and have elected to exempt from certain provisions applicable to U.S. domestic public companies. Please read Prospectus Summary Implications of Being a Foreign Private Issuer. beginning on page 13 of this prospectus for more information. Per Ordinary Share Per Pre-Funded Warrant Approximate Total (assuming all Pre-Funded Warrants are exercised) Public offering price $ $ $ Placement agent commission(1) $ $ $ Proceeds to the Company before expenses $ $ $ (1)We have agreed to pay Craft Capital Management LLC and R. F. Lafferty& Co., Inc. (the Placement Agents ) commission of 6.5% of the aggregate gross proceeds raised in this offering. We have also agreed to (i) reimburse the Placement Agents for a maximum of $100,000 for reasonable and documented out-of-pocket accountable expense; and (ii) provide a non-accountable expense allowance equal to 1.0% of the gross proceeds of this offering payable to the Placement Agents. For a description of compensation payable to the Placement Agents, see Plan of Distribution. We have engaged the Placement Agents to use their reasonable best efforts to solicit offers to purchase our securities in this offering. The Placement Agents have no obligation to purchase any of the Securities from us or to arrange for the purchase or sale of any specific number or dollar amount of the Securities. Because there is no minimum offering amount required as a condition to closing in this offering, the actual public offering amount, placement agent s fee and proceeds to us, if any, are not presently determinable and may be substantially less than the total maximum offering amounts set forth above and throughout this prospectus. We have agreed to pay the Placement Agents the placement agents fees set forth in the table below. See Plan of Distribution in this prospectus for more information. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. CRAFT CAPITAL MANAGEMENT LLC The date of this prospectus is [--], 2025. TABLE OF CONTENTS About this Prospectus ii Market and Industry Data iv Prospectus Summary 1 Risk Factors 20 Special Note Regarding Forward-Looking Statements 52 Use of Proceeds 53 Dividend Policy 54 Capitalization 55 Dilution 56 Management s Discussion and Analysis of Financial Condition and Results of Operations 57 Industry 72 Business 76 Regulations 96 Management 107 Executive Compensation 113 Related Party Transactions 114 Principal Shareholders 116 Description of Securities We are Offering 118 Shares Eligible for Future Sale 133 Material Tax Consequences Applicable to U.S. Holders of Our Ordinary Shares 134 Enforceability of Civil Liabilities 142 Plan of Distribution 144 Expenses Relating to This Offering 146 Legal Matters 146 Experts 146 Where You Can Find Additional Information 146 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS F-1 i ABOUT THIS PROSPECTUS You should rely only on the information contained in this prospectus or in any free writing prospectus we may authorize to be delivered or made available to you. Neither we nor any of the placement agents have authorized anyone to provide any information or to make any representations other than those contained in this prospectus or in any free writing prospectuses we have prepared. We take no responsibility for and can provide no assurance as to the reliability of, any other information that others may give you. We are offering to sell and seeking offers to buy shares of our Ordinary Shares only in jurisdictions where offers and sales are permitted. The information in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or any sale of our Ordinary Shares. Our business, financial condition, results of operations, and prospects may have changed since that date. We are incorporated under the laws of the Cayman Islands. Under the rules of the U.S. Securities and Exchange Commission (the SEC ), we are currently eligible for treatment as a foreign private issuer. As a foreign private issuer, we will not be required to file periodic reports and financial statements with the SEC as frequently or as promptly as domestic registrants whose securities are registered under the Securities and Exchange Act of 1934 (the Exchange Act ). See Prospectus Summary Implications of Being a Foreign Private Issuer. For investors outside the United States: We have not done or authorize anyone to do anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of the Ordinary Shares and the distribution of this prospectus outside the United States. ii Prospectus Conventions Throughout this prospectus, unless the context indicates otherwise, any references to Mingteng International are to Mingteng International Corporation Inc., a Cayman Islands holding company, and any references to we, us, our Company, the Company, and our are to Mingteng International and its subsidiaries. References to PRC Subsidiaries refer to Mingteng International s subsidiaries established under the laws of the People s Republic of China. Unless otherwise indicated, in this prospectus, references to: China or the PRC refers to the People s Republic of China. Ordinary Shares refers to ordinary shares of Mingteng International with par value $0.00001 per share. RMB refers to Renminbi, the legal currency of the PRC. U.S. dollars, $ and USD refers to the legal currency of the United States. Mingteng HK refers to Mingteng International Hong Kong Group Limited, an entity incorporated under the laws and regulations in Hong Kong and a wholly owned subsidiary of Mingteng International. Ningteng WFOE refers to Wuxi Ningteng Intelligent Manufacturing Co., Ltd., a limited liability company organized under the laws of the PRC and a wholly owned subsidiary of Mingteng HK. WFOE refers to a wholly foreign-owned enterprise. Wuxi Mingteng Mould refers to Wuxi Mingteng Mould Technology Co., Ltd., a limited liability company organized under the laws of the PRC and a wholly owned subsidiary of Ningteng WFOE. iii PRESENTATION OF FINANCIAL INFORMATION Basis of Presentation Unless otherwise indicated, all financial information contained in this prospectus is prepared and presented in accordance with generally accepted accounting principles in the United States of America ( U.S. GAAP or GAAP ). Certain amounts, percentages and other figures included in this prospectus have been subject to rounding adjustments. Accordingly, amounts, percentages and other figures shown as totals in certain tables or charts may not be the arithmetic aggregation of those that precede them, and amounts and figures expressed as percentages in the text may not total 100% or, when aggregated may not be the arithmetic aggregation of the percentages that precede them. Our financial year ends on December 31 of each year. References in this prospectus to a financial year, such as financial year 2023 , relate to our financial year ended December 31 of that calendar year. Financial Information in U.S. Dollars The following table outlines the currency exchange rates that were used in preparing the consolidated financial statements, representing exchange rate of the People s Bank of China (PBOC): June 30, December 31, Six months ended June 30, 2024 2023 2024 2023 Foreign currency RMB:1USD 7.1268 7.0827 7.1051 6.9291 For the years ended December 31, For the years ended December 31, 2023 2022 2023 2022 Foreign currency RMB:1USD 7.0827 6.9646 7.0467 6.7261 Source: The State Administration of Foreign Exchange (http://www.safe.gov.cn/safe/rmbhlzjj/index.html) MARKET AND INDUSTRY DATA Certain market data and forecasts used throughout this prospectus were obtained from internal company surveys, market research, consultant surveys, reports of governmental and international agencies and industry publications and surveys. Industry publications and third-party research, surveys and reports generally indicate that their information has been obtained from sources believed to be reliable. This information involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. Our estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed under the heading Risk Factors in this prospectus. iv PROSPECTUS SUMMARY This summary highlights information contained in greater detail elsewhere in this prospectus. This summary is not complete and does not contain all the information you should consider in making your investment decision. You should read the entire prospectus carefully before investing in our Ordinary Shares. You should carefully consider, among other things, our consolidated financial statements and the related notes and the sections entitled Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations included elsewhere in this prospectus. Overview We are a holding company incorporated in the Cayman Islands, being a holding company with no business operations. Wuxi Mingteng Mould Technology Co., Ltd. ( Wuxi Mingteng Mould ) is our PRC subsidiary, incorporated in the PRC. We are an automotive mold developer and supplier in China. Wuxi Mingteng Mould was established in December 2015, focusing on molds used in auto parts. We are committed to providing customers with comprehensive and personalized mold services, covering mold design and development, mold production, assembly, testing, repair and after-sales service. We provide a wide variety of products. Our main products are casting molds for turbocharger systems, braking systems, steering and differential system, and other automotive system parts. We also produce molds for new energy electric vehicle motor drive systems, battery pack systems, and engineering hydraulic components, which are widely used in automobile, construction machinery and other manufacturing industries. Our production plant is located in Wuxi, China. We use technologically advanced procedures and equipment to produce molds. We use a mold manufacturing processing center, which allocates different machines to manufacture according to the size of the mold and the shape of the accessories. Our mold development and production process are supported by our research and development ( R&D ) team (including experts such as foundry technologists and mold designers), using advanced Computer Aided Design ( CAD ), Computer Aided Manufacturing ( CAM ) and software technologies to analyze feasibility and validity of mold designs and specifications. Our quality and capability have obtained the 2019 Jiangsu High-tech Enterprise Certification and ISO9001:2015 certification. In order to improve our technical level and service quality, we are committed to developing and producing molds through technological innovation. We believe that the design and quality of our molds are extremely important to the accuracy and efficiency of our customers manufacturing processes. Our existing technical team consists of 21 people, all with professional knowledge in casting, machining, and automation. They analyze customers casting and processing technology, propose solutions and improvement suggestions to customers to enhance the efficiency and safety of their products. In addition, we believe our research and patents in the field of automotive casting molds have earned us recognition from our customers, and we have registered 13 authorized utility model and invention patents in China. We are a supplier to a number of Chinese listed companies and have established long-term business relationships with leading major customers in the automobile parts manufacturing industry, most of whom have more than 5 years of business relationship with us. Our customers include Kehua Holding Co., Ltd. (ticker: 603161), Wuxi Lihu Booster Technology Co., Ltd. (ticker: 300580), and Wuxi Best Precision Machinery Co., Ltd. (ticker: 300694). Our close relationships with these major customers demonstrate our strengths in technical capabilities, service reputation and product quality. Our revenue mainly comes from customized mold production, mold repair and machining services. The revenue derived from customized mold production accounted for 71.3% and 84.3% of our total revenue for the six months ended June 30, 2024 and 2023, respectively. The revenue derived from mold repair accounted for 11.1% and 13.4% of our total revenue for the six months ended June 30, 2024 and 2023, respectively. The revenue derived from machining services accounted for 17.6% and 2.3% of our total revenue for the six months ended June 30, 2024 and 2023, respectively. The revenue derived from customized mold production accounted for 80.7% and 82.0% of our total revenue for the years ended December 31, 2023 and 2022, respectively. The revenue derived from mold repair accounted for 13.2% and 14.2% of our total revenue for the years ended December 31, 2023 and 2022, respectively. The revenue derived from machining services accounted for 6.1% and 3.8% of our total revenue for the years ended December 31, 2023 and 2022, respectively. 1 Corporate Structure and History We are a Cayman Islands exempted company limited by shares. The following diagram illustrates the corporate structure of the Company as of the date of this prospectus and upon completion of this offering: Mingteng International was incorporated on September 20, 2021 under the laws of the Cayman Islands. As of the date of this prospectus, the authorized share capital of Mingteng International is US$50,000 divided into 5,000,000,000 Ordinary Shares, of which 6,839,600 Ordinary Shares are issued and outstanding. Mingteng International is a holding company and is currently not actively engaging in any business. We conducted all of our business through our PRC subsidiary, Wuxi Mingteng Mould, incorporated in the PRC. This is an offering of the Ordinary Shares of the Cayman Islands holding company. You may never hold equity interests in the operating PRC Subsidiary, Wuxi Mingteng Mould. Further, Mingteng International receives the economic benefits of its PRC subsidiary s business operations through equity ownership. We do not use a Variable Interest Entities or VIE structure. Mingteng HK was incorporated on November 4, 2021 under the laws and regulations in Hong Kong. Mingteng HK is a wholly owned subsidiary of Mingteng International. Mingteng HK is a holding company and is currently not actively engaging in any business. Ningteng WFOE was established on September 6, 2022 under the laws of the PRC. Ningteng WFOE is a wholly owned subsidiary of Mingteng HK. It is a holding company and is not actively engaging in any business. Wuxi Mingteng Mould was established on December 15, 2015 under the laws of the PRC. Wuxi Mingteng Mould is a wholly owned subsidiary of Ningteng WFOE and is our only operating entity. Wuxi Mingteng Mould became a wholly owned subsidiary of Ningteng WFOE through an equity acquisition on September 26, 2022. Upon the incorporation of Mingteng International on September 20, 2021, we issued 1 Ordinary Share to ICS Corporate Services (Cayman) Limited (subsequently transferred to BETTY CHEN LIMITED), 2,091,000 Ordinary Shares to YK XU HOLDING LIMITED, 2,009,000 Ordinary Shares to DJZ HOLDING LIMITED, 450,000 Ordinary Shares to HONGZE L.P., 225,000 Ordinary Shares to JACKY WANG LIMITED, and 224,999 Ordinary Shares to BETTY CHEN LIMITED, respectively, for a total consideration of US$50. 2 The IPO On April 22, 2024, the Company completed its IPO of 1,050,000 Ordinary Shares at a price of $4.00 per share. The total gross proceeds received from the IPO was US$4.2 million. In connection with the closing of the IPO, the Company issued the representative of the underwriters for the IPO (the Representative ) warrants to purchase up to 52,500 Ordinary Shares. On May 10, 2024, the Representative exercised its over-allotment option in full to purchase 157,500 Ordinary Shares at a price of $4.00. The total gross proceeds received from the fully exercise of the over-allotment option was US$630,000. In connection with the over-allotment exercise, the Company issued the Representative warrants to purchase up to 7,875 Ordinary Shares. On November 5, 2024, the Representative exercised its warrants in part to purchase 12,100 Ordinary Shares as a price of $4.80. The total gross proceeds received from the exercise of warrants was US$58,080. The 2024 Equity Incentive Plans On November 11, 2024, the board of directors of the Company approved and adopted an equity incentive plan, which authorized 620,750 Ordinary Shares (plus an indeterminate number of additional shares which may be offered and issued to prevent dilution from share splits, share dividends or similar transactions) to be issued to the directors, officers, managers, employees, consultants or advisors (and prospective directors, officers, managers, employees, consultants and advisors) of the Company and its affiliates. On November 20, 2024, the Company issued a total of 620,000 Ordinary Shares to three employees of the Company. As of the date of this prospectus, there are 6,839,600 Ordinary Shares issued and outstanding. Our Products We are an automotive mold developer and supplier in China. We provide a wide variety of products. Our main products are casting molds for turbocharger systems, braking systems, steering and differential system, and other automotive system parts. Besides, we also produce molds for new energy electric vehicle motor drive systems, battery pack systems, and engineering hydraulic components, which are widely used in automobile, construction machinery and other manufacturing industries. Turbocharger System Molds A turbocharger is an air compressor that uses exhaust gas from engines as the power source. It is generally composed of a compressor housing, compressor wheel, connecting shaft (movement), turbine housing, turbine, and other main components. A turbocharger can be applied to combustion-engine vehicles, as well as new energy and hybrid vehicles, and offers higher fuel efficiency and lower emissions. The turbine housing and center housing are the core components of turbochargers and also our main products. Wuxi Mingteng Mould produces and processes compressor housing, turbine housing, and center housing molds via sand and gravity casting. Braking and Steering System Molds The braking system is a series of devices that force the car to slow down, which is mainly composed of the wheel brake, hydrostatic transmission, and pneumatic transmission gear. The steering system is a device used to change or maintain the driving direction or reverse the direction of a car. We focus on customers needs, and mainly produces and process molds for the steering knuckle, brake disc, steering gear housing, and other parts through a variety of casting processes, including sand casting, metal mold casting, and metal mold low-pressure casting, etc. Aluminum Alloy Product Molds Compared with traditional vehicles, New Electric Vehicles ( NEVs ) have stricter requirements in terms of vehicle weight. Take Tesla s Model S as an example, which has a gross weight of up to 2,108kg, with over 500kg for the battery alone. Meanwhile, the gross weight of a traditional automobile engine is generally 80-160kg. Thus, lightweight design has become the main measure for reducing the weight and consumption of NEVs, so light aluminum alloy pressure castings are more widely used. In the aluminum alloy pressure casting mold business, we provide pressure casting molds for battery fixing brackets and battery end plates for NEVs, pressure casting molds for new energy transmission housings, and inverter top cover pressure casting molds for the photovoltaic industry. 3 Our Services We offer our clients services including (i) product design service, (ii) product repair service, (iii) machining service, and (iv) after-sale service. Product design service We provide product design services based on customers individual requirements through the following process to ensure that the product design meets the technical standard: Communicating with the customer according to the product design drawings, getting to know the customer s development requirements for product parameters, and conducting a summary analysis; Technical team prepares the preliminary product process plan based on the customer s product requirements and carries out a feasibility study. The team then looks into the forming process of the part by conducting a model analysis, helping us find the possible risks of the mold and parts before manufacturing the final part; Technical team checks whether the product process parameters are feasible according to the model analysis results and their experience in actual production and debugging. If there are any manufacturing risks, then we suggest modifications and solutions for the customer in a timely manner; Manufacturing the product needed after completing the product simulation risk assessment, and upon receiving approval from the customer. Product repair service Wuxi Mingteng Mould signs contracts with customers, provides repair services according to the contracts, and charges a certain fee from customers. Machining service Our product machining services mainly include processing turbine housings and center housing parts for automobile turbocharger systems. Customers provide Wuxi Mingteng Mould with unprocessed parts, which Wuxi Mingteng Mould would process and deliver as finished products to them. After-sales service We provide a one-year after-sales service period for our products. During the warranty period stipulated in the contract, Wuxi Mingteng Mould is responsible for maintaining or replacing the supplied products. Specifically, Wuxi Mingteng Mould sends service staff to the customer s site for this service within 24 hours after receiving a customer s request for product maintenance. 4 Our Competitive Advantages Mold technical expertise and production capacity. We import mold manufacturing equipment to improve the machining efficiency and precision of its molds, shorten the project development period, and allow our customers to quickly obtain molds so that they can manufacture products in a short time. Our casting process engineers and mold designers have adopted computer aided technology to perform feasibility and effectiveness analyses when designing molds and creating specifications and to help predict potential part forming defects. In doing so, we have improved the accuracy of Computerized Numerical Control machining and the success rate of mold development. Industry experience and standardized and personalized mold services. Our experience in the industry and standardized production dramatically improves our production and service efficiency and reduce production and management costs. Our R&D team has specialized knowledge of casting, machining, molds, automation, and other fields and has more than 10 years of experience in the industry. We have established several standard operation instructions, covering the process of mold design, machining and manufacturing, assembly, mold trial-manufacturing, quality inspection, and after-sales services for customers. Advanced technology and strong R&D team. We have a professional technology R&D team consisting of 31 full-time employees with more than 10-year experience in the mold industry. It conducts technological innovation and new product development to enable us to improve our large-scale precision casting process, complex structure casting mold design techniques, and mold material adjustment techniques. We will continue to research and develop new technologies, improve production and molding processes, and work on developing and completing its product portfolio. In doing so, we will adapt to the changing mold market and retain and attract customers who require accurate, reliable, high-quality molds. Long-term and stable relations with customers. With our mold technology and production efficiency, we have become a direct supplier to three listed companies in China. In addition, we have also established long-term and stable business relations with leading key customers in the industry, most of whom we have cooperated with for over five years. In addition, our indirect end users include many Chinese and foreign automobile enterprises and famous brands. Experienced and far-sighted management team. We have a management team with professional experience in the mold industry. Our management team is led by our founder and Chief Executive Officer, Mr. Yingkai Xu, who has over 20 years of experience in the automobile mold industry. Mr. Xu is responsible for our overall management and strategic development. Other management team members also have a wide range of technical and management experience in relevant industries. For years, the management team has established close relations with our key customers and suppliers network, gathered extensive expertise and a deep understanding of the automobile mold industry and comprehended industry development and market trends. Our Growth Strategies Our objective is to strengthen and improve our market position in China. We intend to achieve our objective by implementing business strategies in the following key aspects: Expand lines of business and participate in the development of new energy vehicle part molds. Increase production facilities to improve production capacity. Enhance R&D capabilities. Further secure new customers. Optimize production management and improve operation efficiency. Impact of COVID-19 The outbreak of a novel strain of coronavirus ( COVID-19 ) has resulted in quarantines, travel restrictions, and the temporary closure of stores and business facilities globally for the past two years. In March 2020, the World Health Organization declared COVID-19 as a pandemic. Given the rapidly expanding nature of the COVID-19 pandemic, and because substantially all of our business operations and our workforce are concentrated in China, we believe there is a risk that our business, results of operations, and financial condition will be adversely affected. Potential impact on our results of operations will also depend on future developments and new information that may emerge regarding the duration and severity of COVID-19 and the actions taken by government authorities and other entities to contain COVID-19 or mitigate its impact, almost all of which are beyond our control. COVID-19 has had a certain degree of influence on the Company s operations during the years ended December 31, 2021 and 2022. However, with the effective operation of epidemic prevention measures, the epidemic did not seriously affect the Company s order volume and production capacity. In December 2022, China released a set of 10 optimized COVID-19 rules and eliminated most containment measures. In late December, the number of infections in the Company increased and production activity slowed down. With the recovery of employees, the production and operations of the Company gradually returned to normal in 2023. The continuing impact of COVID-19 remains unpredictable. 5 Summary
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY ......................................................................................................................... 1
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+Prospectus Summary 3
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY
+ 
+ This summary contains basic information about us and our business but does not contain all of the information that is important to your investment decision. You should carefully read this summary together with the more detailed information contained elsewhere in this before making an investment decision. Investors should carefully consider the information set forth under the caption Risk Factors appearing elsewhere in this prospectus.
+ 
+ Ultrasound Business 
+ 
+ Overview
+ 
+ We were incorporated as a Delaware corporation in 2007. Currently, we are developing a next-generation enhanced ultrasound technology platform-Thermo-Acoustic Enhanced Ultrasound, or TAEUS . Our first TAEUS platform application focuses on measuring fat in the liver. 
+ 
+ We have recently revisited and re-evaluated ENDRA s vision, purpose, and go-to-market strategy with respect to TAEUS. As a result, we are implementing significant changes to ENDRA s pursuit of future growth. 
+ 
+ First, our renewed vision is to become a leading biomarker solution for metabolic diseases and Glucagon-Like Peptide-1 ( GLP-1 ) drug management. Our mission is to develop and offer an accurate, simple-to-use, inexpensive, at the point-of-care test - like a blood pressure cuff for the assessment and management of metabolic disease. 
+ 
+ Second, we intend to focus on serving these four new markets: 
+ 
+ 1. Pharmaceutical Companies and Clinical Research Organizations ( CROs ) - to assist them in the efficient screening and monitoring of subjects for new GLP-1 therapeutics in clinical trials by providing a critical biomarker in the treatment of metabolic dysfunction-associated steatohepatitis ( MASH ), obesity, and blood sugar regulation.
+ 
+ 2. High-end Primary Care Networks (Concierge Medicine) - to assist them in screening patients for obesity, diabetes, and liver disease, as well as monitoring response to lifestyle changes and drug therapies.
+ 
+ 3. Bariatric and Metabolic Clinics - for the management of obesity, the detection of metabolic disease, and monitoring response to therapies.
+ 
+ 4. Primary and Internal Medicine at Large - to screen patients for metabolic disease related to obesity, diabetes, and hypertension, and monitor response to lifestyle change and drug therapies. The primary care segment may utilize external laboratories, imaging centers, and pharmacies to perform point-of-care liver fat assessment exams, hence this group is expected to be a part of ENDRA s go-to-market strategy for the primary care provider segment at large.
+ 
+ Third, the primary focus of the TAEUS platform is to establish key biomarkers for metabolic diseases management with specific focus on the emerging GLP-1 therapies. We are redefining TAEUS technology to make it more scalable and to improve its adoption in newly targeted large market segments. As a result, we now intend to emphasize the following:
+
+ 
+ 
+ 
+
+ 
+ 
+ Leveraging artificial intelligence and machine learning models to complement our TAEUS technologies and further improve their accuracy;
+ 
+ 
+ Integrating thermo-acoustic technology with conventional ultrasound technologies to simplify, and reduce, the procedure time while reducing user error; and
+ 
+ 
+ Reducing the form factor of TAEUS and making it cost effective.
+ 
+ 
+ 
+
+ Fourth, we plan to implement a new low barrier-to-entry, multi-year, subscription-based business model with monthly recurring revenue. We will retain our traditional direct product sale model with annual upgrade and maintenance fees for customers who may prefer it, but our primary focus will be on the subscription-based approach. In either case, sales are expected to be made by a direct sales force using a value proposition rooted in clinical data supported by results from reference sites. 
+
+ 
+ 
+ 
+
+ 
+ 
+ 4
+ 
+
+ Table of Contents
+ 
+ 
+ We continue to examine the positioning (need, cost, and technical considerations) of our TAEUS platform in the rapidly evolving market for point-of-care assessment of liver fat disease against other opportunities for our platform, such as monitoring of thermo-ablative surgical procedures.
+ 
+ Our TAEUS Technology Platform for Clinical Applications
+ 
+ TAEUS technology uses a pulsed energy source--specifically, radio frequency ( RF )--to transmit energy deep into tissue and generate ultrasonic waves based on the tissue composition (or tissue chemistry), differentiating lean and fatty tissues. These waves are then detected with ultrasound sensors at the skin surface and used to create high-contrast images (and other forms of data) using our proprietary algorithms. Unlike conventional ultrasound, which creates images based on the scattering properties of tissue structure, thermoacoustic imaging provides tissue absorption maps that differentiate lean and fatty tissues. Acoustic waves (ultrasound) are only utilized to transmit the absorption signal to the imaging system outside of the body.
+ 
+ To increase the versatility of our thermoacoustic technology, we developed TAEUS technology as a platform for multiple applications. Unlike the near-infrared light pulses used in our earlier photoacoustic systems, our TAEUS technology uses RF pulses to stimulate tissues, using a small fraction of the energy that is typically transmitted into the body during an MRI scan. Using RF energy enables TAEUS technology to penetrate deep into tissue, enabling tissue composition at clinically relevant depths. The RF pulses are absorbed by tissue and converted into ultrasound signals, which are detected by an external ultrasound receiver and a digital acquisition system that is part of the TAEUS system. The detected ultrasound can then be processed into ultrasound overlays or quantitative data that may be translated into clinically useful metrics using our proprietary algorithms and displayed to complement conventional gray-scale ultrasound images. 
+ 
+ After required regulatory approvals, our TAEUS technology can be added as a standalone system or as an accessory to existing ultrasound systems, helping to improve clinical decision-making on the front lines of patient care, without requiring substantially new clinical workflows or large capital investments. We also intend to offer a license for our TAEUS technology to original equipment manufacturers ( OEMs ), such as ultrasound and thermoablative capital equipment makers, for incorporation in their new products.
+ 
+ We believe that our TAEUS technology has the potential to add a number of new capabilities to conventional ultrasound and other types of capital equipment, thereby enhancing the utility and extending the use of these technologies to circumstances that either currently require the use of expensive CT or MRI imaging systems, where imaging is not practical using existing technology, or where other assessment tools such as surgical biopsy are required. To demonstrate the capabilities of our TAEUS platform, we have conducted various internal ex-vivo laboratory experiments and limited internal in-vivo large animal studies. In our ex-vivo and in-vivo testing, we have demonstrated that the TAEUS platform has multiple capabilities and potential clinical applications, including enhanced ultrasound for the early detection and staging of certain liver diseases and cancer, the real-time visualization of tissue temperature, and blood vessel and blood flow visualization. 
+ 
+ TAEUS Liver Device
+ 
+ ENDRA s first clinical product is designed to interface with a conventional ultrasound scanner, utilizing the scanner s B-mode imaging to guide the selected region for assessment of liver fat content. The following sub-systems will comprise ENDRA s first generation product.
+
+ 
+ 
+ 
+
+ 
+ 
+ Energy Generation: The RF source consists of a low power waveform generator and a high gain amplifier. Together, these components generate the characteristic pulses of energy required to excite thermoacoustic signals in tissue.
+ 
+ 
+ 
+
+ 
+ 
+ Energy Delivery into Tissue: The RF applicator transmits pulses of energy generated by the RF source into tissue. The applicator is positioned at the skin surface in proximity to the target region for measurement and is designed to efficiently couple pulsed RF energy into target tissues.
+ 
+ 
+ 
+
+ 
+ 
+ Signal Detection: A receive only ultrasound transducer specifically designed and optimized for thermoacoustic imaging. The transducer sub-system detects thermoacoustic signals induced by the RF source within tissue. The transducer assembly is connected to high-speed electronics for signal amplification, digitization, and processing.
+ 
+ 
+ 
+
+ 
+ 
+ Computation and Display: The computer provides processing capability to both utilize the conventional ultrasound data for navigation to the measurement site of interest, and the calculations required to convert digitized thermoacoustic signals into estimates of fat content in liver tissue. The entire sub-system will reside in a single enclosure, on wheels, and sit adjacent to the patient exam bed. A small digital touchscreen display is used for both operator input and the display of data.
+ 
+ 
+ 
+
+ 
+ 
+ 5
+ 
+
+ Table of Contents
+ 
+ 
+ TAEUS platforms may provide two-dimensional imaging with a transducer composed of multiple receive elements. ENDRA is currently developing an improved version of its first-generation liver device. The RF source and applicator would be similar to those in the first-generation product, but the multi-element transducer would allow for multiple applications including reading tissue composition, response to thermoablative procedures, vascular flow, tissue perfusion, and other potential applications.
+ 
+ Cryptocurrency Overview and Market
+ 
+ Overview of the Cryptocurrency Industry and Market
+ 
+ Cryptocurrency refers to digital assets that are issued by and transmitted through an open-source protocol, collectively maintained by a peer-to-peer network of decentralized user nodes. These networks host public transaction ledgers, known as blockchains, on which cryptocurrency holdings and all validated transactions that have ever taken place on the cryptocurrency s network are recorded. Balances of cryptocurrency are stored in individual wallet functions, which associate network public addresses with one or more private keys that control the transfer of the cryptocurrency. The blockchain can be updated without any single entity owning or operating the network.
+ 
+ There are numerous digital assets and many entities, including consortia and financial institutions, are researching and investing resources into private or permissioned blockchain platforms or digital assets that do not use proof-of-work mining like the bitcoin network (as described below). For example, in late 2022, the ethereum network transitioned to a proof-of-stake mechanism for validating transactions that requires significantly less computing power than proof-of-work mining. Other alternative digital assets include stablecoins, which are designed to maintain a peg to a reference price because of their issuers promise to hold high-quality liquid assets (such as U.S. dollar deposits and short-term U.S. treasury securities) equal to the total value of stablecoins in circulation. Stablecoins have grown rapidly as an alternative to bitcoin and other digital assets as a medium of exchange and store of value, particularly on digital asset trading platforms. 
+ 
+ Additionally, central banks in some countries have started to introduce digital forms of legal tender. For example, China s central bank digital currency, or CBDC, project was made available to consumers in January 2022, and governments including the United States and the European Union have discussed the potential creation of new CBDCs. 
+ 
+ Bitcoin and the Bitcoin Market 
+ 
+ Bitcoin is a cryptocurrency that is a unit of account on the bitcoin network, an open source, decentralized peer-to-peer computer network. The ownership and operation of bitcoin is determined by purchasers in the bitcoin network. The bitcoin network connects computers that run publicly accessible, or open source, software that follows the rules and procedures governing the bitcoin network. This is commonly referred to as the bitcoin protocol . Bitcoin may be held, may be used to purchase goods and services or may be exchanged for fiat currency. No single entity owns or operates the bitcoin network, and the value of bitcoin is not backed by any government, corporation or other entity. Instead, the value of bitcoin is determined in part by the supply and demand in markets created to facilitate the trading of bitcoin. Public key cryptography protects the ownership and transaction records for bitcoin. Because the source code for the bitcoin network is open source, anyone can contribute to its development. 
+ 
+ The global bitcoin market has experienced significant expansion in recent years, with the total market capitalization of bitcoin reaching over $2 trillion as of June 2025. This growth reflects both the increasing adoption of bitcoin as a store of value and its emergence as a foundational asset within the broader digital asset ecosystem. The number of people with exposure to bitcoin continues to rise, and daily transaction volumes regularly exceed billions of dollars. 
+ 
+ Creation of New Bitcoin and Limits on Supply 
+ 
+ The bitcoin protocol limits the total number of bitcoins that can be generated over time to 21 million. As of June 1, 2025, approximately 20.0 million bitcoins have been generated, highlighting the asset s scarcity and long-term value proposition. New bitcoins are created and allocated by the bitcoin protocol through a mining process that rewards users that validate transactions in the bitcoin blockchain. Validated transactions are added in blocks approximately every 10 minutes. The mining process serves to validate transactions and secure the bitcoin network. Mining is a competitive and costly operation that requires a large amount of computational power to solve complex mathematical algorithms. This expenditure of computing power is known as proof of work. 
+ 
+ To incentivize miners to incur the costs of mining bitcoin, the bitcoin protocol rewards miners that successfully validate a block of transactions with newly generated bitcoin. The current reward for miners that successfully validate a block of transactions is 3.125 bitcoin per mined block. The mining reward is reduced by half, which is referred to as a bitcoin halving, after every 210,000 blocks are mined. This has historically occurred approximately every four years. The most recent bitcoin halving occurred in April 2024, and the next bitcoin halving is expected to occur sometime in 2028. 
+ 
+ Modifications to the Bitcoin Protocol 
+ 
+ Bitcoin is an open-source network that has no central authority, so no one person can unilaterally make changes to the software that runs the network. However, there is a core group of developers that maintains the code for the bitcoin protocol, and they can propose changes to the source code and release periodic updates and other changes. Unlike most software that has a central entity that can push updates to users, bitcoin is a peer-to-peer network in which individual network participants, called nodes, decide whether to upgrade the software and accept the new changes. As a practical matter, a modification becomes part of the bitcoin protocol only if the proposed changes are accepted by participants collectively having more than 50% of the processing power, known as hash rate, on the network. If a certain percentage of the nodes reject the changes, then a fork takes place, and participants can choose the version of the software they want to run. 
+ 
+ Cryptocurrency Industry Participants
+ 
+ The primary cryptocurrency industry participants are miners, investors and traders, digital asset exchanges and service providers, including custodians, brokers, payment processors, wallet providers and financial institutions.
+ 
+ Miners. Miners range from cryptocurrency enthusiasts to professional mining operations that design and build dedicated mining machines and data centers, including mining pools, which are groups of miners that act cohesively and combine their processing power to mine cryptocurrency blocks. 
+ 
+ Investors and Traders. Cryptocurrency investors and traders include individuals and institutional investors who, directly or indirectly, purchase, hold, and sell cryptocurrency or cryptocurrency-based derivatives. On January 10, 2024, the SEC issued an order approving several applications for the listing and trading of shares of spot bitcoin exchange-traded products, or ETPs , on U.S. national securities exchanges. While the SEC had previously approved exchange-traded funds where the underlying assets were bitcoin futures contracts, this order represents the first time the SEC has approved the listing and trading of ETPs that acquire, hold and sell cryptocurrency directly. ETPs can be bought and sold on a stock exchange like traditional stocks, and provide investors with another means of gaining economic exposure to cryptocurrency through traditional brokerage accounts.
+ 
+
+ 
+ 
+ 6
+ 
+
+ Table of Contents
+ 
+ 
+ Digital Asset Exchanges. Digital asset exchanges provide trading venues for purchases and sales of cryptocurrency in exchange for fiat or other digital assets. Cryptocurrency can be exchanged for fiat currencies, such as the U.S. dollar, at rates of exchange determined by market forces on cryptocurrency trading platforms, which are not regulated in the same manner as traditional securities exchanges. In addition to these platforms, over-the-counter markets and derivatives markets for cryptocurrency also exist. The value of a cryptocurrency within the market is determined, in part, by the supply of and demand for the cryptocurrency in the global cryptocurrency market, market expectations for the adoption of the cryptocurrency as a store of value, the number of merchants that accept the cryptocurrency as a form of payment, and the volume of peer-to-peer transactions, among other factors. 
+ 
+ Service providers. Service providers offer a multitude of services to other participants in the cryptocurrency industry, including custodial and trade execution services, commercial and retail payment processing, loans secured by cryptocurrency collateral, and financial advisory services. If adoption of a cryptocurrency network continues to materially increase, we anticipate that service providers may expand the currently available range of services and that additional parties will enter the service sector for such cryptocurrency network.
+ 
+ Government Regulation of Cryptocurrency
+ 
+ The laws and regulations applicable to cryptocurrency and digital assets are evolving and subject to interpretation and change.
+ 
+ Governments around the world have reacted differently to digital assets; certain governments have deemed them illegal, and others have allowed their use and trade without restriction, while in some jurisdictions, such as the U.S., digital assets are subject to overlapping, uncertain and evolving regulatory requirements.
+ 
+ As digital assets have grown in both popularity and market size, the U.S. Executive Branch, Congress and a number of U.S. federal and state agencies, including the Financial Crimes Enforcement Network, the CFTC, the SEC, the Financial Industry Regulatory Authority, the Consumer Financial Protection Bureau, the Department of Justice, the Department of Homeland Security, the Federal Bureau of Investigation, the IRS and state financial regulators, have been examining the operations of digital asset networks, digital asset users and digital asset exchanges, with particular focus on the extent to which digital assets can be used to violate state or federal laws, including to facilitate the laundering of proceeds of illegal activities or the funding of criminal or terrorist enterprises, and the safety and soundness and consumer-protective safeguards of exchanges or other service-providers that hold, transfer, trade or exchange digital assets for users. Many of these state and federal agencies have issued consumer advisories regarding the risks posed by digital assets to investors. In addition, federal and state agencies, and other countries have issued rules or guidance regarding the treatment of digital asset transactions and requirements for businesses engaged in activities related to digital assets.
+ 
+ Depending on the regulatory characterization of cryptocurrency, the markets for cryptocurrency in general, and our activities in particular, our business and our cryptocurrency acquisition strategy may be subject to regulation by one or more regulators in the United States and globally. Ongoing and future regulatory actions may alter, to a materially adverse extent, the nature of digital assets markets, the participation of industry participants, including service providers and financial institutions in these markets, and our ability to pursue our cryptocurrency strategy. Additionally, U.S. state and federal and foreign regulators and legislatures have taken action against industry participants, including digital assets businesses, and enacted restrictive regimes in response to adverse publicity arising from hacks, consumer harm, or criminal activity stemming from digital assets activity. U.S. federal and state energy regulatory authorities are also monitoring the total electricity consumption of cryptocurrency mining, and the potential impacts of cryptocurrency mining to the supply and dispatch functionality of the wholesale grid and retail distribution systems. Many state legislative bodies have passed, or are actively considering, legislation to address the impact of cryptocurrency mining in their respective states.
+ 
+
+ 
+ 
+ 7
+ 
+
+ Table of Contents
+ 
+ 
+ The CFTC takes the position that some digital assets, including bitcoin, fall within the definition of a commodity under the Commodities Exchange Act of 1936, as amended, or CEA. Under the CEA, the CFTC has broad enforcement authority to police market manipulation and fraud in spot digital assets markets in which we may transact. Beyond instances of fraud or manipulation, the CFTC generally does not oversee cash or spot market exchanges or transactions involving digital asset commodities that do not utilize margin, leverage, or financing. In addition, CFTC regulations and CFTC oversight and enforcement authority apply with respect to futures, swaps, other derivative products and certain retail leveraged commodity transactions involving digital asset commodities, including the markets on which these products trade.
+ 
+ The SEC and its staff have taken the position that certain other digital assets fall within the definition of a security under the U.S. federal securities laws. Public statements made by senior officials and senior members of the staff at the SEC indicate that the SEC does not consider bitcoin to be a security under the federal securities laws, and the approval of the spot bitcoin ETPs support this view. However, such statements are not official policy statements by the SEC and reflect only the speakers views, which are not binding on the SEC or any other agency or court and cannot be generalized to any other digital assets.
+ 
+ In addition, because transactions in cryptocurrency provide a degree of anonymity, they are susceptible to misuse for criminal activities, such as money laundering. This misuse, or the perception of such misuse, could lead to greater regulatory oversight of cryptocurrency and cryptocurrency platforms, and there is the possibility that law enforcement agencies could close cryptocurrency platforms or other cryptocurrency-related infrastructure with little or no notice and prevent users from accessing or retrieving cryptocurrency held via such platforms or infrastructure. For example, in her January 2021 nomination hearing before the Senate Finance Committee, Treasury Secretary Janet Yellen noted that cryptocurrencies have the potential to improve the efficiency of the financial system but that they can be used to finance terrorism, facilitate money laundering, and support activities that threaten U.S. national security interests and the integrity of the U.S. and international financial systems. The OFAC has issued updated advisories regarding the use of virtual currencies, added a number of digital asset exchanges and service providers to the Specially Designated Nationals and Blocked Persons list and engaged in several enforcement actions, including a series of enforcement actions that have either shut down or significantly curtailed the operations of several smaller digital asset exchanges associated with Russian and/or North Korean nationals.
+ 
+ As noted above, activities involving cryptocurrency and other digital assets may fall within the jurisdiction of more than one financial regulator and various courts and such laws and regulations are rapidly evolving and increasing in scope. On March 9, 2022, President Biden signed an executive order relating to cryptocurrencies. While the executive order did not mandate the adoption of any specific regulations, it instructed various federal agencies to consider potential regulatory measures, including the evaluation of the creation of a U.S. CBDC. On September 16, 2022, the White House released a framework for digital asset development, based on reports from various government agencies, including the U.S. Department of Treasury, the Department of Justice, and the Department of Commerce. Among other things, the framework encourages regulators to pursue enforcement actions, issue guidance and rules to address current and emergent risks, support the development and use of innovative technologies by payment providers to increase access to instant payments, consider creating a federal framework to regulate nonbank payment providers, and evaluate whether to call upon Congress to amend the Bank Secrecy Act and laws against unlicensed money transmission to apply explicitly to digital asset service providers. 
+ 
+ There have also been several bills introduced in Congress that propose to establish additional regulation and oversight of the digital asset markets. In particular, on May 29, 2025, the Digital Asset Market Clarity Act (the CLARITY Act ) was introduced in the U.S. House of Representatives. The CLARITY Act provides a regulatory framework for digital assets by clarifying the roles of the SEC and CFTC in oversight of various digital assets and transactions in digital assets. The CLARITY Act defines several categories of digital assets: digital commodities and permitted payment stablecoins, which would be subject to the jurisdiction of the CFTC, and excluded digital commodities, such as securities, which would be subject to the jurisdiction of the SEC. 
+ 
+ Our Treasury Strategy
+ 
+ Our Board of Directors and senior management have been examining potential uses of cash, including acquisitions of cryptocurrency. After studying various alternatives, we decided that investing in cryptocurrency is currently the best use of our cash and the Board authorized the Company to develop and pursue a cryptocurrency treasury strategy, whereby cryptocurrency will be our principal treasury holding on an ongoing basis, subject to market conditions and our anticipated cash needs. Following this authorization, the Company retained Anchorage Digital Bank, N.A. ( Anchorage ), a U.S.-based, institutional-grade custodian, to hold cryptocurrency acquired by the Company in connection with its treasury strategy and (ii) engaged Arca Investment Management, LLC, an SEC-registered investment adviser ( Arca ), to manage the Company s cryptocurrency holdings and to implement a bitcoin-based income-generating strategy. Additionally, the Board formed a Cryptocurrency Advisory Board (the Advisory Board ) to assist the Company in developing and managing its cryptocurrency treasury strategy. 
+ 
+ The majority of holdings in the Company s treasury reserve will consist of bitcoin and other cryptocurrencies. Initially, the Company expects to utilize all of its cash allocated to its cryptocurrency treasury strategy to purchase bitcoin; however, in consultation with Arca and the Advisory Board, we intend to continuously monitor cryptocurrency market conditions and consider whether any other cryptocurrencies that are intrinsically linked to a blockchain system, and the value of which is derived from or is reasonably expected to be derived from the use of a blockchain system, would be beneficial to add to the Company s cryptocurrency portfolio, to the extent we determine compliant with federal rules and regulations and not giving rise to a requirement that the Company register as an investment company under the Investment Company Act of 1940 (the 1940 Act ). However, we do not intend to invest in other crypto assets such as stablecoins, memecoins, or privacy coins. As we embark on our new acquisition strategy, our Board intends to proactively evaluate our use of cash, ensuring we maintain adequate working capital. To the extent that any of our assets allocated to our cryptocurrency treasury strategy is not held in bitcoin or other cryptocurrencies, it will be held in cash deposits or cash management instruments, such as U.S. government securities or money market mutual funds. 
+
+ 
+ 
+ 8
+ 
+
+ Table of Contents
+ 
+ Other than acquiring cryptocurrency with our liquid assets that exceed working capital requirements, our cryptocurrency treasury strategy may also involve issuing debt or equity securities or engaging in other capital raising transactions with the objective of using the majority of proceeds to purchase cryptocurrency from time to time, subject to market conditions. We view cryptocurrency as a core holding and expect to accumulate cryptocurrency following this offering. We have not set any specific target for the amount of cryptocurrency we seek to hold, although under the treasury strategy we will maintain a majority of our holdings as bitcoin and other blockchain-linked cryptocurrencies. We will continue to monitor market conditions in determining whether to engage in financings to purchase additional cryptocurrency. This overall strategy also contemplates that we may (i) periodically sell cryptocurrency for general corporate purposes, including to generate cash for treasury management (which may include debt repayment, if appropriate at such time), for acquisitions, or for strategies that generate tax benefits in accordance with applicable law, (ii) enter into additional capital raising transactions that are collateralized by our cryptocurrency holdings, and (iii) pursue strategies to create income streams or otherwise generate funds using our cryptocurrency holdings (for example, generating premium income by selling call options related to cryptocurrencies). Although our cryptocurrency treasury strategy may be refined in the future, we currently do not have a specific policy governing the percentage of our treasury holdings that will be any particular cryptocurrency. However, initially the Company expects to utilize all of its cash allocated to its treasury strategy and used to purchase cryptocurrency to purchase bitcoin. 
+ 
+ Cryptocurrency Advisory Board
+ 
+ We have established a cryptocurrency advisory board to assist in developing and managing our cryptocurrency treasury strategy. This Advisory Board is comprised of:
+ 
+ James Altucher, an entrepreneur, author, cryptocurrency advocate and former hedge fund manager; 
+ 
+ James Manning, founder and Chief Executive Officer of Mawson Infrastructure Group, a U.S.-focused digital infrastructure provider; and 
+ 
+ Rayne Steinberg, co-founder and Chief Executive Officer of Arca, a leading institutional digital asset management firm.
+ 
+ 
+ Asset Manager
+ 
+ The Company has entered into an Investment Management Agreement (the IMA ) with Arca, pursuant to which Arca will provide discretionary investment management services with respect to the Company s cryptocurrency holdings managed by Arca. Under the terms of the IMA, Arca has full discretion to manage, invest and reinvest the Company s cryptocurrency holdings that Arca manages, in accordance with the stated investment strategy. Either party to the IMA may terminate the agreement upon not less than 30, nor more than 60, days written notice to the other party. 
+ 
+ Custody 
+ 
+ We plan to hold substantially all of our cryptocurrency in custody accounts at Anchorage, a U.S.-based, institutional-grade custodian that has demonstrated a record of regulatory compliance and information security. As we further execute on our strategy, we may expand our holdings to multiple similar custodians. 
+ 
+ We have entered into a Master Custody Service Agreement with Anchorage (the Custody Agreement ), pursuant to which it will act as custodian of our digital assets we deposit with Anchorage. Services provided by Anchorage include storage of our digital assets and related settlement and support services. Under the Custody Agreement, Anchorage does not have the authority to assign, hypothecate, pledge, encumber or otherwise dispose of our digital assets, subject to a lien to secure payment to Anchorage in respect of its services. The Custody Agreement has an initial term of one year, at which time it will automatically renew for successive renewal terms unless either party provides no less than 30 days prior written notice. 
+ 
+ Anchorage does not use hot wallets or legacy cold storage approaches in any part of its architecture. Hot wallets can expose private keys to significant risk, and legacy cold storage can make assets inaccessible for transactions and on-chain operations. Anchorage s approach utilizes hardware security modules ( HSMs ) with the intention of providing safety while also extending all the benefits of asset usability. All asset-holding private keys are generated and processed in HSMs with no direct connection to the internet, and do not leave the logical boundary of the HSM unencrypted. The air-gapped, hardened, and tamper-resistant HSMs are housed in commercial data centers to prevent physical attacks as well as attempts to remotely interact with the device s firmware without authorization. Anchorage HSMs utilize custom firmware to enforce specialized policy at the request of each client: the HSM cannot use its keys to sign any operation unless the operation has been endorsed with cryptographic signatures from the necessary quorum of client-side users, which must be provided through individually enrolled iPhones, or if the operation goes through a pre-endorsed API. Each client user endorsement involves multiple forms of biometric authentication, and the submission of a range of behavioral analytic data for review by Anchorage. Any sensitive operation, such as a transaction that moves assets, or changes policy, requires a minimum of two endorsements from a set of at least three client users, to be specified by client administrators and immutable by Anchorage. 
+ 
+ All movements out of Anchorage custody need to be endorsed via Anchorage s iPhone application in order to receive biometric endorsement and proof of client liveness. Additionally, all high-risk operations are subject to a manual risk review by an Anchorage employee in order to detect any unauthorized manipulation of transaction interfaces or smart contract logic. Each client s assets in Anchorage s custody are fully segregated from other clients assets and from Anchorage s assets. Account wallets are organized by vault and logically separated on-chain. 
+ Digital assets with Anchorage are maintained through segregated accounts and may be further segregated within sub-accounts beneath a client account by multiple vaults. Anchorage maintains separate client vaults with unique addresses which can be viewed on the applicable blockchain.
+ 
+ Anchorage s crime insurance policy covers events such as cybercrime, or internal collusion or fraudulent transfer by Anchorage employees resulting in asset loss. Anchorage has end-to-end insurance coverage, which means its crime insurance policy covers assets at all times when they are held at Anchorage, with no distinction between hot and cold storage. Anchorage s crime policy coverage limit applies per incident, not per client, meaning if multiple clients are affected by the same incident, the total recovery would be distributed across all affected clients. 
+ 
+ Accounting
+ 
+ Cryptocurrency accounting guidance has been evolving. According to the American Institute of Certified Public Accountants Accounting for and auditing of Digital Assets practice aid, bitcoin and certain other cryptocurrency would satisfy the definition of an indefinite-lived intangible asset and would be accounted for under ASC 350, Intangibles Goodwill and Other issued by Financial Accounting Standards Board, or FASB. Under these guidelines, bitcoin and other cryptocurrency holdings would be accounted for initially at cost and subject to impairment losses if their fair value fell below carrying value. In December 2023, the FASB issued Accounting Standards Update No. 2023-08, Accounting for and Disclosure of Crypto Assets (ASU 2023-08), which revised cryptocurrency accounting treatment. Under this new guidance, the valuation of cryptocurrency is to be measured based on fair value.
+ 
+ Hedging Strategy
+ 
+ We have not adopted a hedging strategy with respect to cryptocurrency. However, we may from time to time engage in hedging strategies as part of our treasury management operations if deemed appropriate.
+ 
+ Risks Associated with our Cryptocurrency Treasury Strategy 
+ 
+ Although we believe that bitcoin and other blockchain-linked cryptocurrencies in which we intend to invest are based on proven blockchain technology and supported by established infrastructure pertaining to custody and transacting in such cryptocurrencies, our cryptocurrency treasury strategy will be subject to the risks described in the section of the prospectus titled Risk Factors under the heading Risks Relating to Cryptocurrency beginning on page 19. 
+ 
+ Nasdaq Capital Market Listing 
+ 
+ Minimum Bid Price Requirement
+ 
+ In May 2024, the Company received a notification letter from the Listing Qualifications Department of Nasdaq notifying the Company that the Company no longer met the minimum bid price requirement for continued listing on The Nasdaq Capital Market under Nasdaq Marketplace Rule 5550(a)(2), requiring a minimum bid price of $1.00 per share (the Minimum Bid Price Requirement ).
+ 
+ To regain compliance with the Minimum Bid Price Rule, the Company effected a reverse stock split at a ratio of 1-for-50, effective as of August 20, 2024 ( August Reverse Stock Split ). The August Reverse Stock Split did not have the intended effect of regaining compliance with the Nasdaq Minimum Bid Price Rule. Subsequently, the Company effected a 1-for-35 reverse stock split of the shares of its common stock, effective as of November 7, 2024 (the November Reverse Stock Split ). As a result of the November Reverse Stock Split, the Company regained compliance with the Nasdaq Minimum Bid Price Requirement.
+
+ 
+ 
+ 9
+ 
+
+ Table of Contents
+ 
+ While Nasdaq rules do not impose a specific limit on the number of times a listed company may effect a reverse stock split to maintain or regain compliance with the Minimum Bid Price Requirement, Nasdaq has stated that a series of reverse stock splits may undermine investor confidence in securities listed on Nasdaq. In addition, pursuant to Nasdaq Listing Rule 5810(c)(3)(A)(iv), the Company is not eligible for a Minimum Bid Price Requirement compliance period of 180 days for two years following the August Reverse Stock Split. As a result, if the Company fails to satisfy the Minimum Bid Price Requirement, Nasdaq will begin the process of delisting its common stock without providing a Minimum Bid Price Requirement compliance period. However, the Company would still be eligible to request a hearing before the Nasdaq Panel to present its plan for regaining and sustaining compliance with the Minimum Bid Price Requirement.
+ 
+ Stockholders Equity Requirement
+ 
+ On May 27, 2025, the Company received a letter from Nasdaq indicating that, because the Company s stockholders equity as reported in its Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 was $1,752,885, the Company is no longer in compliance with the Nasdaq continued listing requirement to maintain $2.5 million of stockholders equity, a market value of listed securities of at least $35 million, or $500,000 of net income for the most recently completed fiscal year or for two of the three most recently completed fiscal years (the Stockholders Equity Requirement ). Nasdaq s letter provided the Company 45 calendar days, or until July 11, 2025, to submit a plan to regain compliance. On July 11, 2025, the Company submitted its plan to Nasdaq and, as of the date of this prospectus, is awaiting Nasdaq s response. If the plan is accepted, the Company can be granted up to 180 calendar days from May 27, 2025 (or until November 23, 2025), to evidence compliance. In the event the plan is not accepted by the Nasdaq staff, or in the event the plan is accepted but the Company fails to regain compliance within the plan period, the Company would have the right to a hearing before an independent panel pursuant to the procedures set forth in the applicable Nasdaq Listing Rules. However, there can be no assurance that, if the Company does appeal any delisting determination by Nasdaq to a panel, that such appeal would be successful.
+ 
+ The Company intends to take all reasonable measures available to regain compliance under the Nasdaq Listing Rules and remain listed on Nasdaq. The Company is currently evaluating its available options to resolve the deficiency and regain compliance with the Nasdaq minimum stockholders equity requirement. The Company intends to submit the compliance plan by the Nasdaq deadline. However, there can be no assurance that the Company s compliance plan will be accepted by Nasdaq, that it be able to regain compliance with Nasdaq Listing Rule 5550(b)(1), maintain compliance with the other Nasdaq listing requirements or be successful in appealing any delisting determination.
+ 
+ Recent Financial Results
+ 
+ Below is a summary of certain preliminary estimates regarding our financial results for the quarter ended June 30, 2025. This preliminary financial information is based upon our estimates and is subject to completion of our financial closing procedures. Moreover, this preliminary financial information has been prepared solely on the basis of information that is currently available to, and that is the responsibility of, management. Our independent registered public accounting firm has not audited or reviewed, and does not express an opinion with respect to, this information. This preliminary financial information is not a comprehensive statement of our financial results for the quarter ended June 30, 2025, and remains subject to, among other things, the completion of our financial closing procedures, final adjustments, completion of our internal review and review by our independent registered public accounting firm of our financial statements for the quarter ended June 30, 2025.
+ 
+ We expect no revenue for the quarter ended June 30, 2025 and did not have revenue for the quarter ended June 30, 2024.
+ 
+ We expect to record a loss from operations of approximately $1.3 million for the quarter ended June 30, 2025, compared to a net loss of approximately $2.2 million for the quarter ended June 30, 2024.
+ 
+ As of June 30, 2025, we had total assets of approximately $2.6 million and working capital of approximately $1.2 million, including $1.8 million of cash and cash equivalents.
+
+ 
+ 
+ 10
+ 
+
+ Table of Contents
+ 
+ 
+ Risk Factor Summary
+ 
+ Our business is subject to many significant risks, as more fully described in the section titled Risk Factors immediately following this prospectus summary and in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 and any subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, and in the other documents we file with the SEC, each of which are incorporated by reference into this prospectus. You should read and carefully consider these risks, together with all of the other information in this prospectus, including the financial statements and the related notes included herein, before deciding whether to invest in our securities. If any of the risks discussed in this prospectus actually occur, our business, prospects, financial condition or operating results could be materially and adversely affected. In particular, our risks include, but are not limited to, the following:
+
+ 
+ 
+ 
+
+ 
+ 
+ We have a history of operating losses and will need to raise significant additional capital to continue our business and operations.
+ 
+ 
+ 
+
+ 
+ 
+ Our stock price has fluctuated in the past, has recently been volatile and may be volatile in the future for reasons unrelated to our operating performance or prospects, and as a result, investors in our common stock could incur substantial losses.
+ 
+ 
+ 
+
+ 
+ 
+ Our stock is subject to minimum requirements to remain listed on the Nasdaq Capital Market, including a minimum bid price requirement and stockholders equity requirement, and may be delisted if it does not regain compliance with the stockholders equity requirement.
+ 
+ 
+ 
+
+ 
+ 
+ If securities or industry analysts do not publish research reports about our business, or if they issue an adverse opinion about our business, the price of our securities and trading volume could decline.
+ 
+ 
+ 
+
+ 
+ 
+ Future sales and issuances of our common stock or rights to purchase common stock, including pursuant to our at-the-market offering program or equity incentive plan, could result in dilution of the percentage ownership of our stockholders and could cause the price of our securities to fall.
+ 
+ 
+ 
+
+ 
+ 
+ Our charter documents and Delaware law may inhibit a takeover that stockholders consider favorable.
+ 
+ 
+ 
+
+ 
+ 
+ As an investor, you may lose all of your investment.
+ 
+ 
+ 
+
+ 
+ 
+ Our cryptocurrency treasury strategy has not been tested.
+ 
+ 
+ 
+
+ 
+ 
+ Absent federal regulations, there is a possibility that certain cryptocurrencies may be classified as securities. Any classification of a cryptocurrency as a security would subject us to additional regulation and could materially impact the operation of our business.
+ 
+ 
+ 
+
+ 
+ 
+ The emergence or growth of other digital assets, including those with significant private or public sector backing, could have a negative impact on the price of cryptocurrencies we hold and adversely affect our business.
+ 
+ 
+ 
+
+ 
+ 
+ If we were deemed to be an investment company under the 1940 Act, applicable restrictions likely would make it impractical for us to continue segments of our business as currently contemplated.
+ 
+ 
+ 
+
+ 
+ 
+ We may be subject to regulatory developments related to crypto assets and crypto asset markets, which could adversely affect our business, financial condition, and results of operations.
+ 
+ 
+ 
+
+ 
+ 
+ Changes in the accounting treatment of cryptocurrency holdings could have significant accounting impacts, including increasing the volatility of our results.
+ 
+ 
+ 
+
+ 
+ 
+ Our management relies upon the advice of an asset manager through an asset management agreement to assist in building a narrowly focused investment strategy and the execution of the Company s strategy and may not yield the desired return.
+ 
+ 
+ 
+
+ 
+ 
+ Cryptocurrency price volatility may materially depress asset valuations, necessitating substantial cash reserves or liquidity buffers to maintain operational resilience. These risks are compounded by the lack of comprehensive regulation governing cryptocurrency trading platforms, which face material exposure to fraud, market manipulation, security breaches, and operational failures that could materially and adversely affect the value of our cryptocurrency holdings.
+ 
+
+ 
+ 
+ 11
+ 
+
+ Table of Contents
+ 
+ 
+ 
+ 
+
+ 
+ 
+ We may use the net proceeds or a portion thereof from any offering by the Company to purchase additional cryptocurrency, the price of which has been, and will likely continue to be, highly volatile.
+ 
+ 
+ 
+
+ 
+ 
+ Cryptocurrency holdings are less liquid than our existing cash and cash equivalents and may not be able to serve as a source of liquidity for us to the same extent as cash and cash equivalents.
+ 
+ 
+ 
+
+ 
+ 
+ Cryptocurrencies do not pay interest or dividends.
+ 
+ 
+ 
+
+ 
+ 
+ We are not subject to legal and regulatory obligations that apply to investment companies such as mutual funds and exchange-traded funds, or to obligations applicable to investment advisers.
+ 
+ 
+ 
+
+ 
+ 
+ If we or our third-party service providers experience a security breach or cyberattack and unauthorized parties obtain access to our cryptocurrency, or if our private keys are lost or destroyed, or other similar circumstances or events occur, we may lose some or all of our cryptocurrency and our financial condition and results of operations could be materially adversely affected.
+ 
+ 
+ 
+
+ 
+ 
+ We face significant risks relating to disruptions, forks, 51% attacks, hacks, network disruptions, or other adverse events or other compromises to the cryptocurrency blockchains, which could materially and adversely impact our business, financial condition and results of operations.
+ 
+ 
+ 
+
+ 
+ 
+ Our custodially-held cryptocurrencies may become part of the custodian s insolvency estate if one or more of our custodians enters bankruptcy, receivership or similar insolvency proceedings.
+ 
+ 
+ 
+
+ Corporate Information
+ 
+ We were incorporated in Delaware in July 2007. Our corporate headquarters is located at 3600 Green Court, Suite 350, Ann Arbor, Michigan 48105-1570. Our website can be accessed at www.endrainc.com. The telephone number of our principal executive office is (734) 335-0468. The information contained on, or that may be obtained from, our website is not, and shall not be deemed to be, a part of this prospectus.
+
+ 
+ 
+ 
+
+ 
+ 
+ 12
+ 
+
+ Table of Contents
+ 
+ 
+ 
+ 
+
+ THE OFFERING
+
+ 
+ 
+ 
+
+ Common stock offered by us
+ 
+ 15,700,000 shares of common stock.
+
+ 
+ 
+ 
+
+ Pre-funded warrants offered by us
+ 
+ We are also offering pre-funded warrants to purchase up to 15,700,000 shares of common stock (the Pre-Funded Warrants ), which may be sold in lieu of the shares of common stock included in this offering to those purchasers whose purchase of shares of common stock in this offering would otherwise result in the purchaser, together with its affiliates and certain related parties, beneficially owning more than 4.99% (or, at the election of the purchaser, 9.99%) of our outstanding shares of common stock following the consummation of this offering. For each Pre-Funded Warrant we sell, the number of shares of common stock we are offering will be decreased on a one-for-one basis. Each Pre-Funded Warrant will have an exercise price of $0.0001 per share and will be exercisable immediately exercisable, subject to the beneficial ownership limitations described above.
+ 
+ This offering also relates to the offering of the shares of common stock issuable upon exercise of the Pre-Funded Warrants. The exercise price and number of shares of common stock issuable upon exercise will be subject to certain adjustments as described herein. See Description of Securities .
+ 
+ We are also registering the issuance of the 15,700,000 shares of our common stock underlying the Pre-Funded Warrants.
+
+ 
+ 
+ 
+
+ Common stock outstanding immediately prior to this offering
+ 
+ 
+ 752,755 shares.
+ 
+
+ Option to purchase additional securities
+ 
+ We have granted the Underwriter a 45-day option to purchase from us additional 2,355,000 shares of common stock at a price of $ per share, less the underwriting discount and commissions, to cover overallotments, if any. 
+ 
+
+ Use of proceeds
+ 
+ We estimate the net proceeds from this offering to us will be approximately $95.6 million, assuming a public offering price of $6.57 per share, which is the last reported sale price of our common stock on the Nasdaq Capital Market on July 24, 2025 and after deducting the estimated Underwriter fees and expected offering expenses payable by us.
+ 
+ We intend to use an amount equal to approximately 5.0% of the net proceeds from this offering, up to $5.0 million and subject to a floor of $3.0 million, for research and product development, to fund clinical trials and for working capital and general corporate purposes. 
+ 
+ We intend to use the remainder of the net proceeds from this offering to purchase bitcoin to establish the Company s cryptocurrency treasury operations, whereby we will maintain a majority of holdings in the Company s treasury reserve as bitcoin and other blockchain-linked cryptocurrencies that we may identify in the future in consultation with Arca and our Cryptocurrency Advisory Board. We intend to monitor ongoing developments in the regulatory environment around cryptocurrencies, including pending federal legislation, and may modify or expand our treasury strategy to the extent we determine compliant with federal rules and regulations and not giving rise to a requirement that the Company register under the 1940 Act.
+ 
+ Initially the Company expects to utilize all of its cash allocated to its treasury strategy and used to purchase cryptocurrency to purchase bitcoin. To the extent that any of our assets allocated to our cryptocurrency treasury strategy is not held in bitcoin or other cryptocurrencies, it will be held in cash deposits or cash management instruments, such as U.S. government securities or money market mutual funds. 
+ 
+ See the section titled Use of Proceeds. 
+ 
+
+ Nasdaq Capital Market symbol
+ 
+ NDRA. We do not intend to apply for listing of the Pre-Funded Warrants on any securities exchange or other nationally recognized trading system. Without an active trading market, the liquidity of the Pre-Funded Warrants will be limited.
+ 
+
+ Risk factors
+ 
+ See the section titled Risk Factors and other information included and incorporated by reference into this prospectus for a discussion of factors you should consider before investing in our securities.
+ 
+
+ 
+ 
+ 13
+ 
+
+ Table of Contents
+ 
+ 
+ 
+ 
+
+ The number of shares of our common stock to be outstanding after this offer is based on 752,755 shares of common stock outstanding as of July 24, 2025 and excludes the following:
+
+ 
+ 
+ 
+
+ 
+ 
+ 180,707 shares of common stock issuable upon the exercise of outstanding warrants at a weighted-average exercise price of $85.38 per share;
+ 
+ 
+ 
+
+ 
+ 
+ 1 share of common stock issuable upon the conversion of outstanding shares of Series A Convertible Preferred Stock;
+ 
+ 
+ 
+
+ 
+ 
+ 266 shares of common stock issuable upon the exercise of outstanding stock options issued pursuant to our 2016 Omnibus Incentive Plan (the Incentive Plan ) at a weighted average exercise price of $26,594.61 per share;
+ 
+ 
+ 
+
+ 
+ 
+ 179,474 shares of common stock issuable upon the vesting of Restricted Stock Units issued pursuant to the Incentive Plan; and
+ 
+ 
+ 
+
+ 
+ 
+ 309 shares of common stock reserved for future issuance under the Incentive Plan.
+ 
+ 
+ 
+
+ 
+ 
+ 14
+ 
+
+ Table of Contents
+ 
+ RISK FACTORS
+ 
+ Investing in our securities involves risks. Before you make a decision to buy our securities, in addition to the risks and uncertainties discussed above under
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+Prospectus Summary 1
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+PROSPECTUS SUMMARY This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before deciding to invest in our securities, you should read this entire prospectus carefully, including our financial statements and related notes incorporated herein by reference, the information in the section Risk Factors and our filings incorporated by reference herein to which we have referred you in the sections Where You Can Find Additional Information and Information Incorporated by Reference. Company Overview We are a commercial-stage medical technology company dedicated to transforming the lives of patients suffering from fluid overload through science, collaboration, and innovative technology. The Company is focused on developing, manufacturing, and commercializing medical devices used in ultrafiltration therapy, principally marketed as the Aquadex SmartFlow systems (collectively the Aquadex System ). The Aquadex SmartFlow system is indicated for temporary (up to eight hours) or extended (longer than 8 hours in patients who require hospitalization) use in adult and pediatric patients weighing 20 kg or more whose fluid overload is unresponsive to medical management, including diuretics. Recent Developments Arch Therapeutics, Inc. On April 18, 2025, Arch Therapeutics, Inc. ( Arch ) and its fully owned subsidiary, Arch Biosurgery, Inc., filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court, District of Massachusetts (Worcester) (the Court ), case 25-40409. Arch, a biotechnology company developing a novel approach to stop bleeding, control leaking and manage wounds during surgery, trauma and interventional care, has received regulatory authorization to market AC5 Advanced Wound System and AC5 Topical Hemostat as medical devices in the United States and Europe, respectively. Arch continues to operate its business as debtor-in-possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. The Court is accepting bids for substantially all the assets of Arch until June 20, 2025, with an anticipated cash component of not less than approximately $2 million. In the event that we raise approximately the amount of funds included on the cover page of this prospectus (from this offering or any other sources), we will consider submitting a bid for the Arch assets. Even if we do submit a bid, there is no assurance that our bid will be accepted. See the section entitled Risk Factors below for more information. Corporate Information Nuwellis, Inc. was incorporated under the laws of the state of Delaware on August 22, 2002. We began operating our business in November 1999 through Sunshine Heart Company Pty Limited, which dissolved as a wholly owned Australian subsidiary of Nuwellis, Inc in 2020. Our principal executive offices are located at 12988 Valley View Road, Eden Prairie, Minnesota 55344, and our telephone number is (952) 345-4200. Our website address is www.nuwellis.com. The information on, or that may be accessed through, our website is not incorporated by reference into and should not be considered a part of this prospectus or the registration statement of which it forms a part. All share and per share amounts for all periods presented in this prospectus and the registration statement of which it forms a part have been retroactively adjusted to reflect the reverse stock splits we previously effected, including the most recent reverse stock split effected on June 27, 2024. Implications of Being a Smaller Reporting Company We are a smaller reporting company, as defined in Rule 12b-2 of the Exchange Act, meaning that the market value of our shares held by non-affiliates is less than $700 million and our annual revenue was less than $100 million during the most recently completed fiscal year. We will continue to be a smaller reporting company if either (i) the market value of our shares of common stock held by non-affiliates is less than $250 million or (ii) our annual revenue was less than $100 million during the most recently completed fiscal year and the market value of our shares of common stock held by non-affiliates is less than $700 million. As a smaller reporting company, we may continue to rely on exemptions from certain disclosure requirements that are available to smaller reporting companies. Specifically, as a smaller reporting company, we may choose to present only the two most recent fiscal years of audited financial statements in our Annual Report on Form 10-K and, similar to TABLE OF CONTENTS emerging growth companies, smaller reporting companies have reduced disclosure obligations regarding executive compensation. Additionally, as a smaller reporting company, we may continue to take advantage of the exception from compliance with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended. If investors consider our common stock less attractive as a result of our election to use the scaled-back disclosure permitted for smaller reporting companies, there may be a less active trading market for our common stock and the share price of our common stock may be more volatile. TABLE OF CONTENTS The Offering Shares 5,387,931 shares of common stock. Pre-Funded Warrants We are also offering pre-funded warrants to purchase up to 5,387,931 shares of our common stock in lieu of shares of common stock. The purchase price of the pre-funded warrants matches the price per share at which the shares of our common stock (and accompanying common warrants) are being sold to the public in this offering, minus $0.0001, which is the per share exercise price of the pre-funded warrants. Each pre-funded warrant will be exercisable at any time after the date of issuance of such pre-funded warrant, subject to certain ownership limitations. For each pre-funded warrant we sell, the shares of common stock we are offering will be reduced on a one-to-one basis. This offering also relates to the shares of common stock issuable upon the exercise of any pre-funded warrants sold in this offering. For more information regarding the pre-funded warrants, you should carefully read the section entitled Description of the Securities We Are Offering on page 46 of this prospectus. Common Warrants Series A Warrants to purchase up to 16,163,793 shares of common stock which will expire five (5) years from the date of Warrant Stockholder Approval and Series B Warrants to purchase up to 5,387,931 shares of common stock which will expire five (5) years from the date of Warrant Stockholder Approval. The common warrants offered hereby will be exercisable upon receipt of stockholder approval, including such approval as may be required by the applicable rules and regulations of Nasdaq from the stockholders of the Company (the Warrant Stockholder Approval ). We have agreed to hold a meeting to obtain Stockholder Approval as soon as practicable following the closing of this offering, but no later than sixty days following the closing of this offering, and further agreed to cause an additional stockholder meeting to be held every forty days thereafter until such Warrant Stockholder Approval is obtained. We cannot assure you that we will be able to obtain requisite Warrant Stockholder Approval. If we do not obtain the Warrant Stockholder Approval, the common warrants will not be exercisable and therefore have no value. The Series A Warrants have an exercise price of $ per share. The Series A Warrants will contain a one-time reset of the exercise price in the event that the Company implements a reverse stock split to the greater of: (i) 20% of the combined public offering price per share of common stock and accompanying common warrants in this offering and (ii) the lowest TABLE OF CONTENTS daily volume weighted average price for the five trading days immediately following the date of the implementation of a reverse stock split. The Series B Warrants will include a zero cash exercise option allowing holders of a Series B Warrant the right to receive, without payment of any additional cash to the Company, an aggregate number of shares equal to the number of shares of common stock that would be issuable upon a cash exercise of such Series B Warrant. This offering also relates to the shares of common stock issuable upon the exercise of the common warrants sold in this offering. For more information regarding the common warrants, you should carefully read the section entitled Description of the Securities We Are Offering on page 46 of this prospectus. Common Stock Outstanding after this Offering 9,761,899 shares (assuming the exercise of all pre-funded warrants and none of the common warrants or Representative Warrants included in this offering and assuming no exercise of the option granted to the underwriters to purchase additional securities), 10,570,088 shares (assuming exercise in full of the option granted to the underwriters to purchase additional shares of common stock), or 34,732,264 shares (assuming the exercise of all the pre-funded warrants, common warrants and Representative Warrants included in this offering and assuming the exercise in full of the option granted to the underwriters to purchase additional securities). Option to purchase Additional Securities The underwriters have a 45-day option to purchase up to 808,189 additional shares of common stock and/or Series A Warrants to purchase up to 2,424,568 shares of common stock, and/or Series B Warrants to purchase up to 808,189 shares of common stock at their respective public offering prices, less underwriting discounts and commissions. The option may be used to purchase such shares of common stock and/or common warrants, or any combination thereof, as determined by the underwriters. Representative Warrants We have agreed to issue to the representative, as defined herein, warrants to purchase up to 161,637 shares of common stock (or 185,883 shares of common stock assuming the exercise of the underwriters option in full), representing 3.0% of the aggregate number of shares of common stock and/or pre-funded warrants sold in this offering, as a portion of the compensation payable to the representative in connection with this offering (the Representative Warrants ). The Representative Warrants will be immediately exercisable upon issuance at an exercise price equal to $ per share of common stock (equal to 165% of the combined public offering price per share of common stock and accompanying TABLE OF CONTENTS common warrants) and expire on the fifth anniversary of the commencement of sales of the offering. The Representative Warrants and the shares of common stock underlying the Representative Warrants are being registered on the registration statement of which this prospectus is a part. See Underwriting on page 51. Use of Proceeds We estimate that the net proceeds from this offering, after deducting estimated underwriting discounts and commissions and estimated offering expenses, will be approximately $4.2 million (or $4.9 million if the underwriters exercise their option to purchase additional securities in full), assuming a combined public offering price of $0.928 per share of common stock and accompanying common warrants, which was the last reported sale price of our common stock on Nasdaq on May 23, 2025. We currently intend to use the net proceeds of this offering for working capital and general corporate purposes, including possible acquisition activity. See Prospectus Summary Recent Developments of this prospectus. For additional information please refer to the section entitled Use of Proceeds on page 35 of this prospectus. Lock-up Restrictions We and each of our directors, officers and certain stockholders are subject to certain lock-up restrictions as identified in the section titled Underwriting.
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diff --git a/parsed_sections/prospectus_summary/2025/OPADW_offerpad_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/OPADW_offerpad_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights selected information from this prospectus and does not contain all of the information that is important to you in making an investment decision. You should read the entire prospectus carefully, including the information under the headings Risk Factors, Cautionary Note Regarding Forward-Looking Statements, and Management s Discussion and Analysis of Financial Condition and Results of Operations and the financial statements and the notes to those financial statements contained herein or otherwise incorporated by reference in this prospectus. Company Overview Offerpad, dedicated to simplifying the process of buying and selling homes, is committed to providing comprehensive solutions that remove the friction from real estate. Our advanced real estate platform offers a range of services, from consumer cash offers to B2B renovation solutions and industry partnership programs, all tailored to meet the unique needs of our clients. Since 2015, we have leveraged local expertise in residential real estate alongside proprietary technology to guide homeowners at every step. We are headquartered in Tempe, Arizona and operated in over 1,900 cities and towns in 27 metropolitan markets across 18 states as of June 30, 2025. Common Stock Purchase Warrants On July 24, 2025, we issued warrants (the Warrants ) to purchase up to an aggregate of up to 1,428,571 shares of our Class A common stock, $0.0001 par value per share (the Common Stock ) to the selling stockholders named herein (the Selling Stockholders ) in a private placement exempt from registration pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the Securities Act ). The Warrants have an exercise price of $2.30 per share and are initially exercisable on January 26, 2026 and will expire on January 26, 2030. The Warrants contain standard adjustments to the exercise price, including for stock splits, stock dividends, rights offerings and pro rata distributions. The Warrants also include certain rights upon the occurrence of a fundamental transaction (as described in the Warrants), including the right of the holder thereof to receive from us or a successor entity the same type or form of consideration (and in the same proportion) that is being offered and paid to the holders of Common Stock in such fundamental transaction in the amount of the Black Scholes value (as described in the Warrants) of the unexercised portion of the Warrant on the date of the consummation of such fundamental transaction. The Warrants include cashless exercise rights to the extent the resale of the shares of Common Stock underlying the Warrants is not registered under the Securities Act. Under the terms of the Warrants, a holder will not be entitled to exercise any portion of any such Warrant if, upon giving effect to such exercise, the aggregate number of shares of Common Stock beneficially owned by the holder (together with its affiliates, any other persons acting as a group together with the holder or any of the holder s affiliates, and any other persons whose beneficial ownership of Common Stock would or could be aggregated with the holder s for purposes of Section 13(d) or Section 16 of the Securities Exchange Act of 1934, as amended (the Exchange Act )) would exceed 4.99% of the number of shares of Common Stock outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of such Warrant, which percentage may be increased at the holder s election upon 61 days notice to us subject to the terms of such Warrants, provided that such percentage may in no event exceed 9.99%. The Warrants were issued pursuant to a securities purchase agreement between us and the Selling Stockholders, dated July 24, 2025, in connection with which we also issued and sold an aggregate of 2,857,143 shares of Common Stock to the Selling Stockholders in a concurrent registered direct offering. Table of Contents The registration statement of which this prospectus forms a part is being filed to register the resale of the aggregate number of shares of Common Stock issuable upon exercise of the Warrants (the Resale Shares ). Corporate Information We were initially incorporated under the laws of the state of Delaware on August 31, 2020 under the name Supernova Partners Acquisition Company, Inc. In connection with the consummation of the business combination with OfferPad, Inc. ( Old Offerpad ) on September 1, 2021 (the Business Combination ), we changed our name to Offerpad Solutions Inc. Following the Business Combination, the operations of Old Offerpad were our only ongoing operations. Our principal executive offices are located at 433 S. Farmer Avenue, Suite 500, Tempe, Arizona 85281, and our telephone number is (844) 388-4539. Our website address is www.offerpad.com. The information contained in, or accessible through, our website does not constitute a part of this prospectus. We have included our website address in this prospectus solely as an inactive textual reference. Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2025/OP_oceanpal_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/OP_oceanpal_prospectus_summary.txt
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+PROSPECTUS SUMMARY 1
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+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/OTRKQ_ontrak-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/OTRKQ_ontrak-inc_prospectus_summary.txt
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+PROSPECTUS SUMMARY The following summary highlights selected information about us and this offering and does not contain all of the information that you should consider before investing in this offering. You should carefully read this entire prospectus and the documents incorporated by reference into this prospectus, especially the Risk Factors, as well as Management s Discussion and Analysis of Financial Condition and Results of Operations and our financial statements, including the accompanying notes to those statements, incorporated by reference from our most recent Annual Report on Form 10-K and our other filings with the SEC before making an investment decision. In this prospectus, unless context requires otherwise, references to we, us, our, Ontrak or the Company refer to Ontrak, Inc. Company Overview Ontrak, Inc. ( Ontrak, Company, we, us or our ) was incorporated in the State of Delaware on September 29, 2003. Ontrak was founded with a passion for engaging with and transforming health outcomes for anyone impacted by behavioral health conditions through our Wholehealth+ and accompanying suite of solutions. We are a value-based behavioral healthcare company that identifies and engages people with unmet health needs using our proprietary Advanced Engagement System to improve clinical outcomes and reduce total cost of care. Through access to comprehensive claims data and other healthcare information, our technology-enabled platform utilizes analytics and predictive modeling to uniquely identify connections between behavioral health issues and physical chronic conditions, exposing gaps that traditional behavioral health providers often miss. Our program predicts people whose chronic disease will improve with behavior change, recommends effective care pathways that people are willing to follow, and engages and guides them to and through the care and treatment they need. By combining advanced analytics with human engagement, we deliver improved member health and validated outcomes and savings to healthcare payors. Our integrated, technology-enabled solutions are designed to provide healthcare solutions to members with behavioral conditions that cause or exacerbate chronic medical conditions such as diabetes, hypertension, coronary artery disease, chronic obstructive pulmonary disease, and congestive heart failure, which result in high medical costs. Ontrak has a unique ability to engage these members, who may not otherwise seek behavioral healthcare, leveraging proprietary enrollment capabilities built on deep insights into the drivers of care avoidance. Ontrak integrates evidence-based psychosocial and medical interventions delivered either in-person or via telehealth, along with care coaches who address the social and environmental determinants of health. Our programs seek to improve member health and deliver validated cost savings to healthcare payors. We operate as one segment in the United States and we contract with leading national and regional health plans and other at-risk payors to make our solutions available to eligible members. We generate revenues from the services we provide to populations insured by (a) private health insurance programs, including employer funded programs (which we refer to as commercial revenue) and (b) government funded health insurance programs, such as managed Medicare Advantage, managed Medicaid and dual eligible (Medicare and Medicaid) populations. We aim to increase the number of members that are eligible for our solutions by signing new contracts and identifying more eligible members within customers with whom we have existing contracts. Recent Developments Keep Well Agreement Funding In April 2022, we and Acuitas Capital LLC ( Acuitas Capital and together with its affiliates, Acuitas ) entered into a Master Note Purchase Agreement. In March 2024, we and Acuitas entered into the sixth amendment to the Master Note Purchase Agreement (the Sixth Amendment and the Master Note Purchase Agreement, as amended to date, the Keep Well Agreement ). In the Sixth Amendment, the parties agreed that, Copies to John Tishler, Esq. Sheppard, Mullin, Richter Hampton LLP 12275 El Camino Real, Suite 100 San Diego, CA 92130 Charles E. Phillips Ellenoff Grossman Schole LLP 1345 Avenue of the Americas New York, NY 10105 Approximate date of commencement of proposed sale to the public As soon as practicable after the effective date of this registration statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company, and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. INFORMATION REGARDING FORWARD-LOOKING STATEMENTS This prospectus contains forward-looking statements that involve risks, uncertainties and assumptions. You should not place undue reliance on these forward-looking statements. All statements other than statements of historical fact in this prospectus are forward-looking statements. The forward-looking statements in this prospectus are only predictions. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, our financial condition, results of operations, strategy, short- and long-term business operations and objectives, and financial needs. In some cases, you can identify these forward-looking statements by terms such as anticipate, believe, continue, could, depends, estimate, expects, intend, may, ongoing, plan, potential, predict, project, should, will, would or the negative of those terms or other similar expressions, although not all forward-looking statements contain those words. These forward-looking statements include, but are not limited to, statements concerning the following our ability to raise capital to fund our operations the proceeds of this offering the timing or success of obtaining regulatory licenses or approvals sufficiency of our working capital to fund our operations in the near and long term, which raises doubt about our ability to continue as a going concern infrastructure required to support operations in future periods, including the expected costs thereof estimates associated with revenue recognition, asset impairments, and cash flows variance in our estimates of future operating costs the effectiveness of our disclosure controls and our internal control over financial reporting the impact of new accounting pronouncements size and growth of our target markets and the initiation, timing, progress, and results of our research and development programs. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, without limitation in connection with the issuance of each senior secured convertible promissory note (a Demand Note ) issued thereunder, we will issue to Acuitas a warrant to purchase shares of our common stock (a Demand Warrant ) and that the number of shares of our common stock underlying each Demand Warrant would be equal to (y) the product of the principal amount of the applicable Demand Note and 200% divided by (z) the initial exercise price of the applicable Demand Warrant. Under the Sixth Amendment, in April 2024, we issued and sold to Acuitas a Demand Note with a principal amount of $1.5 million, and, in Acuitas sole discretion, Acuitas could elect to purchase up to an additional $13.5 million in principal amount of Demand Notes, at such time and in such principal amounts as specified in the Sixth Amendment. We refer to the convertible promissory notes representing our borrowings under the Keep Well Agreement, including the Demand Notes, as the Keep Well Notes. In August 2024, we entered into an agreement with Acuitas pursuant to which Acuitas agreed to purchase an aggregate of $5.0 million of Demand Notes, and not to exercise its right to require that any amounts due under any Demand Note be paid until after August 30, 2025 except, if we receive proceeds from a capital contribution or the issuance of any capital stock after November 1, 2024, Acuitas, in its sole discretion, may require that the net proceeds therefrom be applied to pay any amounts due under the Demand Notes purchased under the agreement we entered into with Acuitas in August 2024 (such Demand Notes, the August Demand Notes ). As of March 31, 2025, Acuitas has purchased all $5.0 million of the August Demand Notes. On April 8, 2025, we, Acuitas and Mr. Peizer entered into an agreement under which (i) Acuitas waived (a) any non-compliance and or violation of each of the recurring revenue and liquidity covenants in the Keep Well Agreement through and including June 30, 2025, and (b) solely with respect to our consolidated financial statements for the year ended December 31, 2024, any non-compliance and or violation of the covenant in the Keep Well Agreement requiring that such financial statements and the report of our auditor thereon be unqualified as to going concern and (ii) we agreed that the foregoing waivers are in satisfaction of our claim to, and that the Company will not seek, restitution under the Mandatory Victim Restitution Act, 18 U.S.C. 3663A and the Victim and Witness Protection Act, 18 U.S.C. 3663 with respect to the matters adjudicated in United States v. Terren S. Peizer, Court Docket 2 23-CR-89. On May 9, 2025, under the Sixth Amendment, we issued a Demand Note to Acuitas in the original principal amount of $0.5 million, and in connection therewith, we issued to Acuitas a Demand Warrant to purchase approximately 609,756 shares of our common stock with an exercise price of $1.64. On May 19, 2025, we and Acuitas entered into an agreement (the May 2025 Agreement ) relating to Keep Well Agreement. Under the May 2025 Agreement, Acuitas committed to purchase from us (i) up to $5.0 million in principal amount of Demand Notes and (ii) up to $5.0 million in principal amount of senior secured non-convertible promissory notes payable upon demand of the holder (the Non-Convertible Demand Notes ). We, at any time, may request that Acuitas purchase a Demand Note in a principal amount up to $1.5 million, and at any time after Acuitas has purchased all $5.0 million in principal amount of Demand Notes, we may request that Acuitas purchase a Non-Convertible Demand Note in a principal amount of up to $1.5 million. Acuitas obligation to purchase a Demand Note or Non-Convertible Demand Notes, as the case may be, is subject to the conditions that (1) (x) we used best efforts to effect a registered equity offering to raise sufficient capital to pay and discharge, when due and payable, all of our obligations, (y) we were unable despite our best efforts to effect such offering on reasonably acceptable terms, as determined by our board of directors (such determination to be made as if the financing contemplated by the May 2025 Agreement were not available to us) and (z) absent obtaining the funds we requested, we will not have sufficient unrestricted cash to pay and discharge, when due and payable, all of our obligations for the 30-day period following the date such notice is delivered and (2) since May 19, 2025, there shall have been no material adverse change (or any event or events that, individually or in the aggregate, with or without lapse of time, could reasonably be expected to result in a material adverse The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED JUNE 20, 2025 Ontrak, Inc. Up to 4,666,666 Shares of Common Stock Up to 4,666,666 Pre-Funded Warrants to Purchase up to 4,666,666 Shares of Common Stock Up to 18,666,664 Warrants to Purchase up to 18,666,664 Shares of Common Stock Up to 23,333,330 Shares of Common Stock underlying the Pre-Funded Warrants and the Warrants This is a reasonable best efforts public offering of up to 4,666,666 shares (the shares ) of our common stock, par value $0.0001 per share ( common stock ) together with up to 18,666,664 warrants to purchase up to 18,666,664 shares of common stock (the warrants ) at an assumed combined public offering price of $1.50 per share and four warrants. Each share of common stock is being offered together with four warrants, with each warrant exercisable to purchase one share of common stock. The shares of common stock and warrants will be separately issued. The warrants will have an initial exercise price of $ ___ per share. The right of a holder to exercise the warrants is subject to obtaining stockholder approval in accordance with and as required by the rules of The Nasdaq Stock Market ( Nasdaq ) to permit exercise of the warrants, and if obtained, the warrants will be exercisable beginning on the effective date of such stockholder approval and will expire five years from such date. If we are unable to obtain such stockholder approval, the warrants will not be exercisable and therefore they will have no value. Under the terms of the warrants, we agreed to either (i) obtain stockholder approval via the written consent of our stockholders in accordance with applicable law and prepare and file an information statement with respect thereto with the Securities and Exchange Commission (the SEC ), as promptly as practicable, but prior to the 30th day after the date the warrants are issued (or, if such filing is delayed by a court or regulatory agency, in no event later than 60 days after such date), or (ii) call and hold a special meeting of our stockholders not later than 60 days after the date the warrants are issued to obtain the stockholder approval, and to use our reasonable best efforts to solicit proxies in favor of the stockholder approval. No assurances can be given that we will be able to obtain stockholder approval. See The Offering on page 8 of this prospectus. At March 31, 2025, our total cash was $4.1 million and we had negative working capital of $3.1 million. For the three months ended March 31, 2025, our average monthly cash burn rate from operations was $0.9 million. Even after taking into account the funds to be raised from the offering described in this prospectus, we will need to raise additional capital to fund our operations through the 12-month period following the date of this prospectus. Many aspects of our ability to obtain additional capital are not entirely within our control and there can be no assurance that we will receive additional capital when needed, on favorable terms, or at all. If we cannot raise capital, on favorable terms or at all, we will need to reevaluate our planned operations and may need to cease operations, file for bankruptcy, liquidate, and or wind-up our affairs. These circumstances raise substantial doubt about our ability to continue as a going concern. We have incurred significant losses since our inception and may be unable to obtain additional funds before we achieve positive cash flows. As of May 31, 2025, we had approximately $15.8 million, including accrued paid-in-kind interest, outstanding under the Keep Well Agreement (as defined below), of which approximately $13.0 million is represented by promissory notes payable at any time after the earlier of (i) September 1, 2026 and (ii) 30 days following the date on which Acuitas (as defined below) has purchased all $5.0 million in principal amount of the Non-Convertible Demand Notes (as defined below) under the May 2025 Agreement (as defined below). A default under the Keep Well Agreement or under any of the promissory notes issued thereunder would have a material adverse effect on our financial condition, operating results, and business. See Prospectus Summary Recent Developments Recent Adjustments to Outstanding Warrants, below. Our programs and solutions may not be as effective as we believe and may not achieve broad market acceptance and announcements of disappointing results may lead to declines in the market prices of our securities. change) in our results of operations, business operations, properties, assets, condition (financial or otherwise), customer relations, business activities or business prospects. Under the terms of the May 2025 Agreement, we may not request, without Acuitas consent, that Acuitas purchase more than $1.5 million in principal amount of Demand Notes or Non-Convertible Demand Notes, as the case may be, within any 30-day period, and to the extent we receive proceeds from a capital contribution or the issuance of any capital stock on or after May 19, 2025, Acuitas may, in its sole discretion, elect to reduce the amount of Demand Notes and Non-Convertible Demand Notes to be purchased on a dollar-for-dollar basis. In accordance with the terms of the Sixth Amendment, in connection with the issuance of each Demand Note, we will issue to Acuitas a Demand Warrant. If a Non-Convertible Demand Note is issued, we will not issue any warrant or any other security in connection with the issuance of such Non-Convertible Demand Note. The terms of the Non-Convertible Demand Notes are the same as the terms of the Demand Notes except that the Non-Convertible Demand Notes are not convertible and when the amounts payable by us under a Non-Convertible Demand Note become due, in addition to all other amounts owed by us in respect thereof, we will pay to the holder thereof an amount in cash equal to the difference, as determined in a manner mutually acceptable to us and Acuitas, between the value of (i) a Demand Note with the same principal amount as the applicable Non-Convertible Demand Note, and (ii) the applicable Non-Convertible Demand Note, as of the issuance date of the applicable Non-Convertible Demand Note. In determining the value of a Demand Note, the value of the conversion rights of Demand Notes and of the warrants that would have been issued in connection with the issuance of a Demand Note and upon conversion of a Demand Note, assuming it was converted in full, will be taken into account. As of May 31, 2025, approximately $15.8 million, including accrued paid-in-kind interest, was outstanding under the Keep Well Agreement, of which approximately $13.0 million is represented by Demand Notes and the balance of which matures on May 14, 2026, unless it becomes due and payable in full earlier, whether by acceleration or otherwise. In the May 2025 Agreement, Acuitas agreed not to exercise its right to require that any amounts due under any Demand Note or Non-Convertible Demand Note be paid until the earlier of (a) September 1, 2026 and (b) 30 days following the date on which Acuitas has purchased all $5.0 million in principal amount of Non-Convertible Demand Notes. If Acuitas were to demand that all or a significant portion of the Demand Notes be paid at any time on or after September 1, 2026 (or if earlier, 30 days following the date on which Acuitas has purchased all $5.0 million in principal amount of Non-Convertible Demand Notes), we may not have sufficient funds to repay the amounts due, which would have a material adverse effect on our business and raise substantial doubt about our ability to continue as a going concern. For additional information, see the risk factors described in Risk Factors Risk Related to our Business, below. Recent Adjustments to Outstanding Warrants In accordance with the terms of the warrants we previously issued to Acuitas under the Keep Well Agreement (which, at the time the parties entered into the May 2025 Agreement, had exercise prices of between $1.48 and $2.08 per share) and of the November 2023 Warrants (as such term is defined below) (which, at the time the parties entered into the May 2025 Agreement, had an exercise price of $2.08 per share), if the exercise price of such warrants is greater than the lowest volume weighted average price ( VWAP ) of our common stock on any trading day during the five trading day period immediately following the public announcement of our entry into the May 2025 Agreement, then the exercise price will be reduced to such lowest VWAP, and if the exercise price is reduced, the number of shares of our common stock subject to such warrants will increase proportionally such that after such reduction of the exercise price, the aggregate exercise price payable under such warrants for the adjusted number of shares will be the same as the aggregate exercise price in effect immediately prior to such adjustment. The lowest VWAP of our common stock on any trading day during the five trading day period immediately following the public announcement of our entry into the May 2025 Agreement was $1.553. Accordingly, each of the warrants issued to Acuitas under the Keep Well Agreement and each of the November 2023 Warrants that had an exercise price per share greater than $1.553 was reduced The warrants offered in this offering have price-based anti-dilution protection provisions. Under these anti-dilution provisions, while these warrants are outstanding, subject to certain limited exceptions, the exercise price of these warrants will be reduced each time we issue or sell (or are deemed to issue or sell) any securities for a consideration per share less than a price equal to their exercise price in effect immediately prior to such issuance or sale (or deemed issuance or sale), provided that in no event will the exercise price be reduced to less than the floor price (as described below), which floor price is subject to customary adjustments in the event of stock dividends, stock splits, reorganizations or similar events affecting our common stock. In addition, these anti-dilution provisions provide that, if the exercise price of the warrants decreases, then the number of shares of our common stock issuable upon exercise thereof will proportionally increase. The floor price will not be less than 20% of the lower of (i) the closing price of our common stock immediately preceding the time we enter into the securities purchase agreements with the investors in this offering or (ii) the average closing price for the five trading days immediately preceding such time. Assuming the lesser of clause (i) and (ii) in the preceding sentence was $1.50 (which was the closing price of our common stock as reported on Nasdaq on June 11, 2025), the floor price would be $0.30, and, if the exercise price of the warrants was reduced to the floor price, the total number of shares of common stock potentially issuable upon exercise of all the warrants being offered in this offering would be 93,333,320. We are also offering pre-funded warrants to those purchasers, whose purchase of shares of common stock in this offering would result in the purchaser, together with its affiliates and certain related parties, beneficially owning more than 4.99% (or, at the election of the purchaser, 9.99%) of our outstanding common stock following the consummation of this offering in lieu of the shares of our common stock that would result in ownership in excess of 4.99% (or, at the election of the purchaser, 9.99%). Each pre-funded warrant will be exercisable for one share of common stock at an exercise price of $0.0001 per share. Each pre-funded warrant is being offered together with the same four warrants described above being offered with each share of common stock. The purchase price of each pre-funded warrant will equal the combined public offering price per share of common stock and warrants being sold in this offering, less the $0.0001 per share exercise price of each such pre-funded warrant. Each pre-funded warrant will be exercisable upon issuance and will expire when exercised in full. The pre-funded warrants and warrants will be separately issued. For each pre-funded warrant that we sell, the number of shares of common stock that we are selling will be decreased on a one-for-one basis. This prospectus also covers all the shares of common stock issuable from time to time upon the exercise of the pre-funded warrants and the warrants accompanying the shares of common stock and pre-funded warrants offered hereby. There is no established public trading market for the pre-funded warrants or warrants, and we do not expect a market to develop. We do not intend to apply for listing of the pre-funded warrants or warrants on any securities exchange or other nationally recognized trading system. Without an active trading market, the liquidity of the pre-funded warrants and warrants will be limited. Our business currently depends upon a few significant customers. Since 2021, we have lost four significant customers. The loss of one or more other significant customers would have a material adverse effect on our financial condition, operating results and business. We depend upon our senior management and key consultants and their loss or unavailability could put us at a competitive disadvantage. We need to attract and retain highly skilled personnel we may be unable to effectively manage growth with our limited resources. Customers may not achieve the savings we expect to be created by our programs and solutions, which could adversely impact our business. Market acceptance of our programs and solutions depends in large part on the willingness of third party payors to cover them, which is beyond our control. We may be unable to protect our intellectual property rights and we may be liable for infringing the intellectual property rights of others. Ongoing healthcare legislative and regulatory reform measures may have a material adverse effect on our business and results of operations. We must comply with significant government regulations, including with respect to licensure and privacy matters. Our Series A Preferred Stock has no fixed maturity date, ranks junior to our currently outstanding indebtedness, is entitled to the payment of dividends only to the extent we may do so under Delaware corporate law, and has limited voting rights. As of May 31, 2025, our largest stockholder controls approximately 46% of our outstanding common stock and beneficially owns approximately 97% of our common stock, and may determine all matters presented for stockholder approval, including the election of directors, significant corporate transactions and our dissolution. We are subject to ongoing litigation and may be subject to future litigation, any of which could result in substantial liabilities. Our common stock may be delisted by Nasdaq. The price of our common stock and preferred stock may be volatile. The market prices for our common stock and preferred stock may be adversely impacted by future events. to $1.553, and the aggregate number of shares of our common stock subject to such warrants increased from 42,304,917 to 56,134,451. The term November 2023 Warrants refers to (i) the warrants to purchase shares of our common stock we issued in a public offering completed in November 2023, and (ii) a warrant to purchase shares of our common we issued to Humanitario Capital LLC, an affiliate of Acuitas Capital, in a private placement completed in November 2023. Potential Seventh Amendment to Keep Well Agreement and Adjustment to Outstanding Warrants Prior to or simultaneous with the closing of this offering, we intend to enter into an amendment to the Keep Well Agreement with Acuitas (such amendment, the Seventh Amendment ). The following is a summary of the terms of the Seventh Amendment we intend to enter into with Acuitas Effective as of the date we enter into the Seventh Amendment, all of our rights and obligations and those of Acuitas under the May 2025 Agreement terminate. Subject to the terms of the Seventh Amendment, (i) Acuitas commits to purchase up to $8.7 million in principal amount of Demand Notes (the Committed Demand Notes ) and (ii) Acuitas may (but shall have no obligation to) purchase additional Demand Notes (the Uncommitted Demand Notes and together with the Committed Demand Notes, the Seventh Amendment Demand Notes ). We may request that Acuitas purchase a Committed Demand Note in a principal amount up to $1.5 million, and at any time after Acuitas has purchased all $8.7 million in principal amount of Committed Demand Notes, we may request that Acuitas purchase an Uncommitted Demand Note in a principal amount of up to $1.5 million. Acuitas obligation to purchase a Seventh Amendment Demand Note is subject to the conditions that (i) absent obtaining the funds requested by us, we will not have sufficient unrestricted cash to pay and discharge, when due and payable, all of our obligations for the 30-day period following the date such notice is delivered and (ii) since the date of the Seventh Amendment, there shall have been no material adverse change (or any event or events that, individually or in the aggregate, with or without lapse of time, could reasonably be expected to result in a material adverse change) in our results of operations, business operations, properties, assets, condition (financial or otherwise), customer relations, business activities or business prospects. We may not request, without Acuitas consent, that Acuitas purchase more than $1.5 million in principal amount of Seventh Amendment Demand Notes within any 30-day period, and to the extent we receive proceeds from a capital contribution or the issuance of any capital stock on or after the date of the Seventh Amendment (including the proceeds we receive from this offering), Acuitas may, in its sole discretion, elect to reduce the amount of Committed Demand Notes to be purchased on a dollar-for-dollar basis. The Seventh Amendment Demand Notes will be in the same form as the Demand Notes except that the conversion price of the Seventh Amendment Demand Notes will be equal to the lesser of (i) the closing price of our common stock as of immediately prior to the time the parties enter into the Seventh Amendment and (ii) the greater of (a) the closing price of our common stock on the trading day that is immediately prior to the applicable conversion date and (b) one-third of the closing price of our common stock as of immediately prior to the time the parties enter into the Seventh Amendment, in each case, subject to customary adjustment for stock splits, stock dividends, stock combinations and similar transactions. Acuitas agrees not to exercise its right to require that any amounts due under any Seventh Amendment Demand Note or Demand Note be paid until the earlier of (i) September 1, 2026 and We engaged Roth Capital Partners, LLC ( Roth or the Placement Agent ) to act as our exclusive placement agent in connection with this offering. The Placement Agent agreed to use its reasonable best efforts to arrange for the sale of the securities offered by this prospectus. The Placement Agent is not purchasing or selling any of the securities we are offering by this prospectus and the Placement Agent is not required to arrange the purchase or sale of any specific number of securities or dollar amount. We have agreed to pay to the Placement Agent the Placement Agent fees set forth in the table below, which assumes that we sell all of the securities offered by this prospectus. There is no arrangement for funds to be received in escrow, trust or similar arrangement. There is no minimum number of shares of securities or minimum aggregate amount of proceeds that is a condition for this offering to close. We may sell fewer than all of the securities offered hereby, which may significantly reduce the amount of proceeds received by us, and investors in this offering will not receive a refund if we do not sell all of the securities offered hereby. Because there is no escrow account and no minimum number of securities or amount of proceeds, investors could be in a position where they have invested in us, but we have not raised sufficient proceeds in this offering to adequately fund the intended uses of the proceeds as described in this prospectus. We will bear all costs associated with the offering. See Plan of Distribution on page 29 of this prospectus for more information regarding these arrangements. Our common stock is listed on The Nasdaq Capital Market under the symbol OTRK . On June 11, 2025, the closing price as reported on The Nasdaq Capital Market was $1.50 per share. Until October 7, 2025, we are subject to a discretionary panel monitor. If we fail to maintain compliance with any continued listing requirement in Nasdaq s Listing Rules through October 7, 2025, Nasdaq will issue a delist determination letter and promptly schedule a hearing with a Nasdaq hearing panel. See Recent Developments Nasdaq Matters, beginning on page 7. You should read this prospectus, together with additional information described under the headings Incorporation of Certain Information By Reference and Where You Can Find More Information, carefully before you invest in any of our securities. This offering will terminate on , 2025, unless we decide to terminate it (which we may do at any time in our discretion) prior to that date. We will have one closing for all the securities purchased in this offering. The combined public offering price per share of common stock (or pre-funded warrant in lieu thereof) and accompanying warrants will be fixed for the duration of this offering. All share, warrant and pre-funded warrant numbers are based on an assumed combined public offering price of $1.50 per share or $1.4999 per pre-funded warrant, as applicable, and warrants. The actual combined public offering price per share and warrants and the actual combined public offering price per pre-funded warrant and warrants will be determined between us and investors based on market conditions at the time of pricing, and may be at a discount to the current market price of our common stock. Therefore, the assumed public offering price used throughout this prospectus may not be indicative of the final public offering price. We have two classes of stock common stock and Series A Cumulative Perpetual Preferred Stock ( Series A Preferred Stock ). The holders of our outstanding common stock will hold approximately 47% of the voting power of our outstanding capital stock immediately following this offering. Each share of common stock is entitled to one vote. Voting rights for holders of the Series A Preferred Stock exist primarily with respect to voting on amendments to our certificate of incorporation, including the certificate of designations relating to the Series A Preferred Stock, that materially and adversely affect the rights of the holders of Series A Preferred Stock or authorize, increase or create additional classes or series of our capital stock that are senior to the Series A Preferred Stock. However, since August 2023, the holders of the Series A Preferred Stock have had the right to elect two directors to our board of directors. As of the date of this prospectus, no directors have been elected to our board of directors by the holders of the Series A Preferred Stock in their capacity as such. Our certificate of incorporation, bylaws and Delaware law have anti-takeover provisions that could discourage, delay or prevent a change in control, which may cause our stock price to decline. Forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described in Risk Factors. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statement. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this prospectus may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements. You should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur. Moreover, except as required by law, neither we nor any other person assumes responsibility for the accuracy and completeness of any forward-looking statement. Except as required by law, we undertake no obligation to update publicly any forward-looking statement for any reason after the date of this prospectus to conform these statements to actual results or to changes in our expectations. You should read this prospectus and the documents that we reference in this prospectus and have filed with the SEC as exhibits to the registration statement of which this prospectus is a part with the understanding that our actual future results, levels of activity, performance and events and circumstances may be materially different from what we expect. (ii) 30 days following the date on which Acuitas has purchased $8.7 million in principal amount of Seventh Amendment Demand Notes. Unless and until the effective date of the stockholder approval described in the final bullet below occurs, we will not issue any shares of our common stock in connection with the conversion of any Seventh Amendment Demand Note. In connection with each Seventh Amendment Demand Note purchased by Acuitas, we will issue to Acuitas a Demand Warrant to purchase such number of shares of our common stock that results in 200% warrant coverage. Each Demand Warrant will have a term of five years and an initial exercise price equal to the closing price of our common stock on the date on which we receive the funds evidenced by the applicable Seventh Amendment Demand Note, which initial exercise price will be subject to further adjustment in accordance with the terms of the Demand Warrants. We will not issue any Demand Warrant in connection with the issuance of any Seventh Amendment Demand Note issued after the initial $15.0 million in aggregate principal amount of Seventh Amendment Demand Notes and Demand Notes issued under the Existing Agreement unless and until the effective date of the stockholder approval described in the final bullet occurs, and promptly as practicable following such date, we will issue each Demand Warrant that would have been issued through and including such date. Effective as of the effective date of the stockholder approval described in the final bullet, the conversion price of the Demand Notes issued on March 28, 2025, May 9, 2025, and May 27, 2025 (collectively, the Amended Demand Notes ) will be amended to be equal to the lesser of (i) $1.48 (for the Demand Note issued on March 28, 2025), $1.64 (for the Demand Note issued on May 9, 2025), and $1.59 (for the Demand Note issued on May 27, 2025), and (ii) the greater of (a) the closing price of our common stock as reported on the trading day that is immediately prior to the applicable conversion date and (b) $1.80, in each case, subject to customary adjustment for stock splits, stock dividends, stock combinations and similar transactions. The dollar amounts in clause (i) of the preceding sentence were the closing price of our common stock on the trading day on which the applicable Amended Demand Note was issued. Acuitas waives any right to require that any net proceeds we receive from an equity financing (including the net proceeds we receive from this offering) be applied to pay any amounts due under any of the Seventh Amendment Demand Notes or Demand Notes before any amounts due thereunder become due and payable. We commit to seek stockholder approval in accordance with the Nasdaq listing rules of (a) the issuance of the Seventh Amendment Demand Notes, the Demand Warrants to be issued in connection with the Seventh Amendment Demand Notes and the warrants to be issued upon conversion of the Seventh Amendment Demand Notes, (b) the amendment to the Amended Demand Notes contemplated by the Seventh Amendment, (c) the issuance of the shares of our common stock upon conversion or exercise, as applicable, of the Seventh Amendment Demand Notes, the Demand Warrants to be issued in connection with the Seventh Amendment Demand Notes, Amended Demand Notes, and the warrants to be issued upon conversion of the Seventh Amendment Demand Notes, and (d) any other terms of the Seventh Amendment that require approval of our stockholders under Nasdaq Stock Market listing rules. In connection with entering into the Seventh Amendment, we intend to enter into agreements with Acuitas and the holders of the November 2023 Warrants, pursuant to which Acuitas and such holders agree to the following adjustments to the exercise price of the warrants they hold (in lieu of the adjustments that would otherwise be made in accordance with the terms of such warrants) (i) the exercise price is reduced to the closing price of our common stock as of immediately prior to the time the parties enter into the Seventh Amendment (ii) if such closing price is greater than the combined public offering price per share and four warrants in this offering, then the exercise price will be further reduced to the combined public offering price (iii) if the exercise price, after You should read this prospectus, the information incorporated by reference herein and the additional information described under the heading Where You Can Find More Information carefully before you invest. On September 23, 2024, we effected a 1-for-15 reverse stock split of our common stock. Unless otherwise indicated, all the share, per share information, derivative security numbers and exercise prices in this prospectus have been adjusted to give effect to such reverse stock split. We are a smaller reporting company as defined under federal securities law and we have elected to comply with certain reduced public company reporting requirements available to smaller reporting companies. See the section titled Prospectus Summary Implications of Being a Smaller Reporting Company. Prior to making an investment decision, you should carefully consider all of the information in this prospectus and all information incorporated by reference into this prospectus. Investing in our securities involves risks. See Risk Factors beginning on page 13. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. Per Share and Warrants(1) Per Pre- Funded Warrant and Warrants(1) Total Public offering price $ $ $ Placement Agent fees $ $ $ Proceeds to us, before expenses(2) $ $ $ (1) The final public offering price per share of common stock (or pre-funded warrant in lieu thereof) and accompanying warrant will be determined by us, the Placement Agent and the investors in this offering and may be a discount to the market price of our common stock. (2) We estimate the total expenses of this offering will be approximately $351,109. The actual public offering price, Placement Agent fees, and proceeds to us, if any, are not presently determinable and may be substantially less than the total amount set forth in this table and throughout this prospectus. Because there is no minimum number of securities or amount of proceeds required as a condition to closing in this offering, the actual offering amount, Placement Agent fees, estimated expenses and net proceeds to us, if any, are not presently determinable and may be substantially less than the total amounts set forth above. The amount of the proceeds to us presented in this table does not give effect to any cash exercise of the warrants offered hereby. See Plan of Distribution for additional information regarding the Placement Agent compensation. We will deliver all securities to be issued in this offering delivery versus payment upon receipt of investor funds received by us. Delivery of the securities to the purchasers in this offering is expected to be made on or about , 2025. Roth Capital Partners The date of this prospectus is , 2025 being reduced pursuant to the preceding clause (i) and (ii), is greater than the lowest volume weighted average price ( VWAP ) of our common stock on any trading day during the five trading day period immediately following the public announcement of us entering into the Seventh Amendment, then the exercise price will be further reduced to the lowest VWAP on any trading day during such five trading day period and (iv) if any Keep Well Note is converted into shares of our common stock at a conversion price less than the exercise price of the warrants then in effect, then the exercise price will be further reduced to such conversion price at such time of such conversion. In accordance with the terms of the warrants held by Acuitas and the November 2023 Warrants, upon each adjustment to exercise price thereof, the number of shares of common stock issuable upon exercise thereof increases proportionately such that after each adjustment to the exercise price, the aggregate exercise price payable upon exercise for the adjusted number of shares issuable upon exercise thereof will be the same as the aggregate exercise price in effect immediately prior to each such adjustment to the exercise price (without regard to any limitations on exercise contained in the November 2023 Warrants). No assurances can be given that we will enter into the Seventh Amendment or the agreements described above with Acuitas and the holders of the November 2023 Warrants, or if we do, that the final terms of the Seventh Amendment and of such agreements will be as summarized above. Reverse Stock Split We effected a 1-for-15 reverse stock split of our common stock, effective at 12 01 a.m. Eastern Time on September 23, 2024 (the 2024 Reverse Stock Split ). Our common stock began trading on The Nasdaq Capital Market on a post-split basis at the open of trading on September 23, 2024. Unless otherwise indicated, the share and per share information in this prospectus reflects the effects of the September 2024 reverse split. Customer Notification In October 2024, we were notified by a health plan customer of its intent not to continue using our services after December 2024. For the year ended December 31, 2024, we billed this customer approximately $6.5 million, representing 59% of our revenue. Business Developments As of June 15, 2025, we have five active prospects in the later stages of the sales process, meaning we have presented our product portfolio to such prospects and they agreed to evaluate our proposal. One of the largest of these prospects paused its review of our proposal while it continues to assess our financial stability and our ability to deliver our program as a Medicaid provider in the state in which such prospect operates. As a result of this pause, the expected timeline to move to the final contracting phase with this prospect has been delayed. These five prospects have a combined estimated member outreach pool of up to 20,000 lives for Wholehealth+ and another 40,000 for Engage. While we do not have any firm commitments with any of these five prospects, we are confident in the proposals we delivered to them, and we are optimistic we can move towards final decisions with them before the end of 2025. Also, our newest health plan customers have indicated an interest in expanding our solutions to additional populations, once clinical and financial outcomes are achieved. In addition to the five prospects described above, as of June 15, 2025, we have 20 additional active prospects in varying phases of the sale process representing approximately 15 million plan lives. Insurance Recoveries We are involved in various securities class actions and purported stockholder derivative complaints, and we have incurred legal costs related to an investigation by the SEC and Department of Justice of our former chief executive officer and chairman of our board of directors. We maintain a corporate liability insurance policy which provides coverage for legal defense costs. The terms of this insurance policy provide that the insurer will TABLE OF CONTENTS Page ABOUT THIS PROSPECTUS (i) INFORMATION REGARDING FORWARD-LOOKING STATEMENTS (ii) PROSPECTUS SUMMARY 1 THE OFFERING 8 RISK FACTORS 13 USE OF PROCEEDS 22 DILUTION 22 DESCRIPTION OF SECURITIES WE ARE OFFERING 24 PLAN OF DISTRIBUTION 29 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS 37 LEGAL MATTERS 38 EXPERTS 38 WHERE YOU CAN FIND MORE INFORMATION 38 INCORPORATION OF DOCUMENTS BY REFERENCE 38 pay the third party directly on our behalf for such legal defense costs. Based on our analysis, our obligation as the primary obligor of the invoices for legal defense costs has not been transferred to the insurer and as such, we record these costs as a receivable with a corresponding liability on our consolidated balance sheet. As of March 31, 2025, we submitted cumulative claims for legal defense costs totaling approximately $5.7 million, of which $4.9 million has been paid by the insurer to third parties. We have $0.8 million of claims for legal defense costs recorded as other receivable included in Prepaid expenses and other current assets and $0.8 million as part of Other accrued liabilities on our consolidated balance sheet as of March 31, 2025. Nasdaq Matters From October 2023 to October 2024, we were not in compliance with the minimum bid price requirement in Nasdaq Listing Rule 5550(a)(2) (the Minimum Bid Price Rule ). On October 7, 2024, we received a letter from the Nasdaq Office of General Counsel confirming that we regained compliance with the Minimum Bid Price Rule by October 7, 2024 because the closing bid price for our common stock was $1.00 or more for a minimum of 10 consecutive trading sessions. That letter also informed us that, pursuant to Nasdaq Listing Rule 5815(d)(4)(A), we will be subject to a discretionary panel monitor for a period of one year from October 7, 2024, and that if, within that one-year monitoring period, we fail to maintain compliance with any continued listing requirement, Nasdaq will issue a delist determination letter and promptly schedule a new hearing with a Nasdaq hearing panel. Notwithstanding Nasdaq Listing Rule 5810(c)(2), we will not be permitted to provide a plan of compliance to Nasdaq s staff with respect to any deficiency that arises during the one-year monitoring period, and the Nasdaq staff will not be permitted to grant additional time for us to regain compliance with respect to any such deficiency. See the risk factor titled, There can be no assurance that our common stock will continue to be listed on Nasdaq or, if listed, that we will be able to comply with its continued listing requirements, which could limit investors ability to transact in our securities and subject us to additional trading restrictions, beginning on page 13 of this prospectus. Corporate Information Ontrak was incorporated in the State of Delaware on September 29, 2003. Our principal executive offices are located at 333 S. E. 2nd Avenue, Suite 2000, Miami, FL 33131 and our telephone number is (310) 444-4300. Our website address is www.ontrakhealth.com. The information contained on our website is not incorporated by reference into this prospectus, and you should not consider any information contained in, or that can be accessed through, our website as part of this prospectus or in deciding whether to purchase our securities. Implications of Being a Smaller Reporting Company We are a smaller reporting company as defined in the Securities Exchange Act of 1934, as amended (the Exchange Act ). To the extent that we continue to qualify as a smaller reporting company, we may take advantage of accommodations afforded to smaller reporting companies including (i) not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes Oxley Act of 2002, so long as we also qualify as a non-accelerated filer as defined in the Exchange Act (ii) scaled executive compensation disclosure requirements and (iii) providing only two years of audited financial statements, instead of three years. We will qualify as a smaller reporting company (i) until the fiscal year following the determination that the market value of our voting and non-voting common stock held by non-affiliates is more than $250 million measured on the last business day of our second fiscal quarter, or (ii) if our annual revenues are less than $100 million during the most recently completed fiscal year, until the fiscal year following the determination that the market value of our voting and non-voting common stock held by non-affiliates is more than $700 million measured on the last business day of our second fiscal quarter.
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+II-10 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Carlsbad, State of California on September 29, 2025. Palisade Bio, Inc. By: /s/ J.D. Finley J.D. Finley Chief Executive Officer POWER OF ATTORNEY KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints J.D. Finley, as his or her true and lawful attorney-in-fact, proxy, and agent, with full power of substitution, for him or her in any and all capacities, to sign any and all amendments to this registration statement (including post-effective amendments or any abbreviated registration statement and any amendments thereto filed pursuant to Rule 462(b) increasing the number of securities for which registration is sought), and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact, proxy, and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully for all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorney-in-fact, proxy, and agent, or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act, this registration statement on Form S-1 has been signed by the following persons in the capacities and on the dates indicated. Signature Title Date /s/ J.D. Finley Chief Executive Officer and Director September 29, 2025 J.D. Finley (Principal Executive Officer) /s/ J.D. Finley Chief Financial Officer September 29, 2025 J.D. Finley (Principal Financial and Accounting Officer) /s/ Donald A. Williams Chairman of the Board and Director September 29, 2025 Donald A. Williams /s/ Binxian Wei Director September 29, 2025 Binxian Wei /s/ Emil Chuang Director September 29, 2025 Emil Chuang II-11
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diff --git a/parsed_sections/prospectus_summary/2025/PAPA_papa_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/PAPA_papa_prospectus_summary.txt
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+Prospectus Summary 1
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+F-1 1 ea0254928-f1_purple.htm REGISTRATION STATEMENT As filed with the Securities and Exchange Commission on August 29, 2025 Registration No. 333- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM F-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 PURPLE BIOTECH LTD. (Exact name of Registrant as specified in its charter) Israel 2834 Not applicable (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification No.) 4 Oppenheimer Street Science Park Rehovot 7670104, Israel (Address, including zip code, and telephone number, including area code, of Registrant s principal executive offices) Puglisi & Associates 850 Library Avenue Suite 204, Newark, DE 19715 Tel: +1 (302) 738-6680 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies of all communications, including communications sent to agent for service, should be sent to: Rick A. Werner, Esq. Jayun Koo, Esq. Haynes and Boone, LLP 30 Rockefeller Plaza, 26th Floor New York, New York 10112 Tel. (212) 659-7300 Fax (212) 884-8234 Sharon Rosen, Adv. FISCHER (FBC & Co.). 146 Derech Menachem Begin Tel Aviv-Yafo 6492103, Israel +972 3-694-4111 Ellenoff Grossman & Schole LLP 1345 Avenue of the Americas, 11th Floor New York, New York 10105 Telephone: (212) 370-1300 Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this Registration Statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933. Emerging growth company If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. The term "new or revised financial accounting standard" refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. The information in this preliminary prospectus is not complete and may be changed. We may not sell these securities until the Registration Statement filed with the Securities and Exchange Commission, of which this preliminary prospectus is a part, is effective. This preliminary prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION DATED AUGUST 29, 2025 Up to 2,702,702 American Depositary Shares representing 540,540,400 Ordinary Shares Up to 2,702,702 Pre-Funded Warrants to Purchase up to 2,702,702 American Depositary Shares Up to 5,405,404 Series B Warrants to Purchase up to 5,405,404 American Depositary Shares Up to 189,189 Placement Agent Warrants to Purchase up to 189,189 American Depositary Shares (and up to 2,702,702 American Depositary Shares representing 540,540,400 Ordinary Shares underlying the Pre-Funded Warrants, up to 5,405,404 American Depositary Shares representing 1,081,080,800 Ordinary Shares underlying the Series B Warrants and up to 189,189 American Depositary Shares representing 37,837,800 Ordinary Shares underlying the Placement Agent Warrants) Purple Biotech Ltd. We are offering on a "reasonable best efforts" basis up to 2,702,702 American Depositary Shares ("ADSs"), with each ADS representing 200 of our ordinary shares, no par value per share ("Ordinary Shares"), or 540,540,400 Ordinary Shares in the aggregate, together with up to 5,405,404 Series B warrants to purchase up to 5,405,404 ADSs representing 1,081,080,800 Ordinary Shares (the "Warrants"). The ADSs and Warrants will be sold in a fixed combination, with each ADS accompanied by two Warrants, each to purchase one ADS representing 200 of our ordinary shares. The ADSs and Warrants are immediately separable and will be issued separately in this offering, but must be purchased together in this offering. The assumed combined public offering price for each ADS and accompanying Warrants is $2.22, which was the closing price of the ADSs on The Nasdaq Capital Market ("Nasdaq") on August 27, 2025. The Warrants will have an exercise price per ADS of $ and will be immediately exercisable for a term of twenty-four (24) months from the date of issuance. We are also offering to those purchasers, if any, whose purchase of ADSs in this offering would result in the purchaser, together with its affiliates and certain related parties, beneficially owning more than 4.99% (or at the election of the purchaser, 9.99%) of our outstanding Ordinary Shares, including Ordinary Shares represented by ADSs, immediately following consummation of this offering, the opportunity to purchase, if they so choose, Pre-Funded Warrants to purchase up to 2,702,702 ADSs in lieu of ADSs that would otherwise result in beneficial ownership in excess of 4.99% (or 9.99%, as applicable) of our outstanding Ordinary Shares, including Ordinary Shares represented by ADSs. The purchase price of each Pre-Funded Warrant and accompanying Warrants will equal the price per ADS and accompanying Warrants being sold to the public in this offering, minus $0.0001, which is the exercise price per ADS of each Pre-Funded Warrant. Each Pre-Funded Warrant will be exercisable for one ADS. Each Pre-Funded Warrant will be immediately exercisable and may be exercised at any time until exercised in full, subject to an ownership limit. This prospectus also relates to the offering of the ADSs issuable upon exercise of any Pre-Funded Warrants sold in this offering. For each Pre-Funded Warrant we sell, the number of ADSs we are offering will be decreased on a one-for-one basis. There is no established public trading market for the Pre-Funded Warrants or Warrants, and we do not expect a market for the Pre-Funded Warrants or Warrants to develop. We do not intend to apply for a listing of the Pre-Funded Warrants or Warrants on any national securities exchange. Without an active trading market, the liquidity of the Pre-Funded Warrants and Warrants will be limited. We refer to the ADSs, the Pre-Funded Warrants and Warrants to be issued in this offering collectively as the "Securities." The ADSs are listed on Nasdaq under the symbol "PPBT." On August 28, 2025, the last reported sale price of the ADSs on Nasdaq was $2.27 per ADS. Our Ordinary Shares are listed on the Tel Aviv Stock Exchange ("TASE") under the symbol "PPBT." On August 28, 2025, the last reported sale price of our Ordinary Shares on the TASE was NIS 0.038, or $0.01 per Ordinary Share (based on the exchange rate reported by the Bank of Israel on such date, which was NIS 3.33 = $1.00). The assumed combined public offering price used throughout this prospectus has been included for illustration purposes only and may not be indicative of the final combined public offering price. The actual combined public offering price per ADS (or Pre-Funded Warrant in lieu thereof) and accompanying Warrants will be determined between us and investors, in consultation with the Placement Agent (as defined below), based on market conditions at the time of pricing, and may be at a discount to the then current market price of the ADSs. The actual combined public offering price may be based upon a number of factors, including our history and our prospects, the industry in which we operate, our past and present operating results, the previous experience of our executive officers and the general condition of the securities markets at the time of this offering. We have engaged H.C. Wainwright & Co., LLC (the "Placement Agent") to act as our exclusive placement agent in connection with this offering. The Placement Agent has agreed to use its reasonable best efforts to arrange for the sale of the Securities offered by this prospectus. The Placement Agent is not purchasing or selling any of the Securities we are offering and the Placement Agent is not required to arrange the purchase or sale of any specific number of Securities or dollar amount. We have agreed to pay to the Placement Agent the Placement Agent fees set forth in the table below, which assumes that we sell all of the Securities offered by this prospectus. There is no minimum number of Securities or amount of proceeds required as a condition to closing in this offering. Because there is no minimum offering amount required as a condition to closing this offering, we may sell fewer than all of the Securities offered hereby, which may significantly reduce the amount of proceeds received by us, and investors in this offering will not receive a refund in the event that we do not sell an amount of Securities sufficient to pursue our business goals described in this prospectus. This offering will terminate on October 3, 2025, unless we decide to terminate
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/QDMI_qdm_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/QDMI_qdm_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/QTIWW_qt_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/QTIWW_qt_prospectus_summary.txt
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights selected information appearing in this prospectus. Because it is a summary, it may not contain all of the information that may be important to you. To understand this offering fully, you should read this entire prospectus carefully, including the information set forth in the sections entitled Risk Factors, Management s Discussion and Analysis of Financial Condition and Results of Operations, Business and the consolidated financial statements and related notes included elsewhere in this prospectus before making an investment decision. The Company QT Imaging Holdings was incorporated in January 2021 as a blank check company under the name GigCapital5. In March 2024, the Company completed its business combination with QT Imaging, which resulted in QT Imaging becoming a wholly-owned subsidiary of the Company. QT Imaging is a medical device company founded in 2012 and engaged in the research, development, and commercialization of innovative body imaging systems using low energy sound. We believe that medical imaging is critical to the detection, diagnosis, and treatment of disease and that it should be safe, affordable and accessible. Our goal is to improve global health outcomes through the development and commercialization of imaging devices that address critical healthcare challenges with accuracy and precision. For more information about the Company, see the sections entitled Business and Management s Discussion and Analysis of Financial Condition and Results of Operation. Products and Services The Company currently offers two products: QT Breast Scanner and QTviewer . QT Breast Scanner is a fixed, mechanical scanner used to evaluate the breast without the use of either ionizing radiation or compression associated with mammography, or the contrast dyes (as environmentally impactful gadolinium etc.) injections required for breast MRI. With the QT Breast Scanner, the patient lies comfortably on a table which contains an opening through which the breast is placed in a warm water bath (see Image 1) and gently immobilized using a magnetic retention pad fixed to a magnetic rod. The QT Breast Scanner differs from the handheld ultrasound used in breast imaging in that it utilizes reflection and transmission data from low-frequency sound waves, providing a significant increase in diagnostic information using the speed of sound characteristics of the breast and acquiring in true 3D a very accurate rendering of the breast tissue. The QT Breast Scanner provides sub-millimeter, high-definition, image resolution enabling identification of normal and abnormal breast structures and the accurate depiction of the precise shape and location of findings. The technology uniquely quantifies breast density using ratio of breast fibroglandular tissue volume (FGV) to total breast volume (TBV) transmission and reflection images information of patient s breast to further personalize a patient s management recommendations. Surface-to-volume ratios and volumetric doubling time growth rate characteristics can be calculated to determine significance of lesions and improve specificity of the ultrasound. The QT Breast Scanner creates true 3D images of the patient s breast viewable in the Quantitative Transmission Ultrasound Viewer (known as QTviewer ), a software product designed for healthcare professionals to view the transmission (speed of sound) and reflection images. This application can display correlated Digital Imaging and Communications in Medicine ( DICOM ) images in multiple orientations (coronal, sagittal, and axial). QTviewer can manipulate image views and analyze pixel data with various functions. The QTviewer has additional functionality which enables the user to measure mass size (linear) and volume (segmentation tool) as well as fibroglandular tissue volume. For clarity, QTViewer can measure both 2D and 3D, while 2D is standard of care, 3D is the better way to quantify a lesion when not standard of care. The current version of the QT Breast Scanner is U.S. Food and Drug Administration ( FDA )-cleared for patients age 18 and older for use as an ultrasonic imaging system to provide reflection-mode and transmission-mode images of a patient s breast. The device is not intended to be used as a replacement for screening mammography. The QT Breast Scanner has current applicability as a supplementary imaging device, not as a replacement for screening mammography. Current applicability is for measuring fibroglandular tissue volume, Table of Contents measuring mass size and growth will be addressed in short term by submitting letter to file to the FDA. Determining breast density and diagnosing lesions using artificial intelligence will be addressed in the near term, the Company plans to address with the FDA the applicability for breast screening in medium-to long-term. Sales and Marketing Since our inception, we have devoted substantially all our financial resources to acquiring and developing the base technology for our body imaging systems, conducted research and development activities, secured related intellectual property rights, and for general corporate operations and growth. Our first product, the QT Ultrasound Breast Scanner (which was later renamed QT Breast Scanner ), received FDA s 510(k) market clearance in June 2017. NXC The Company s primary sales and marketing efforts in the short-to-medium term will be to focus on the $3 billion breast imaging market in United States supported by the exclusive partnership with the Company s distribution partner, NXC Imaging, Inc. ( NXC ), a wholly owned subsidiary of Canon Medical USA, Inc. ( CMSU ). On May 31, 2023, we entered into a Sales Agent Agreement (the NXC Sales Agent Agreement ) with NXC pursuant to which we appointed NXC as the non-exclusive agent for the sale of QT Imaging products and services in non-exclusive territories: the U.S., U.S. territories, and U.S. Department of Defense installations. Additionally, NXC was appointed as the exclusive servicer of QT Imaging products sold by NXC under the terms of the NXC Sales Agent Agreement. Effective June 10, 2024, the NXC Sales Agent Agreement was superseded by the a Distribution Agreement (the NXC Distribution Agreement ) that was entered into with NXC on June 18, 2024. Under the NXC Distribution Agreement, NXC is appointed as the exclusive reseller to market, advertise, and resell QT Breast Scanners in the U.S. and U.S. territories. On December 11, 2024, the Company and NXC entered into an Amended and Restated Distribution Agreement (the Amended Distribution Agreement ), which amends and restates the NXC Distribution Agreement in its entirety, making some modifications to the NXC Distribution Agreement but retaining other terms. Among other changes made by the Amended Distribution Agreement, this amended and restated agreement provides that, unless earlier terminated or extended by mutual written agreement, has a term through December 31, 2026, and further provides that no later than five days prior to the end of each calendar quarter, NXC shall provide to the Company a forecast of the anticipated purchases of QT Breast Scanners during the subsequent twelve-month period. The Amended Distribution Agreement further provides that the forecast for 2025 and 2026 shall be no less than the Minimum Order Quantities (the MOQs ) set forth in an exhibit to the Amended Distribution Agreement, by quarter and by year. Furthermore, all purchase orders from NXC shall be for no less than the MOQs, which NXC must order on the quarterly and annual basis as set forth in an exhibit to the Amended Distribution Agreement. On March 28, 2025, the Company entered into Amendment No. 1 to the Amended and Restated Distribution Agreement (the First Amendment to A&R Distribution Agreement ). The First Amendment to A&R Distribution Agreement amends certain provisions of the Amended Distribution Agreement. It provides, among other things, that the Company reserve the right to sell the QT Breast Scanners directly to a third party as an exception, and any such direct sale by the Company shall occur after a prior written notification to NXC and shall count towards the MOQs, provided that if a third party is a competitor of NXC as defined in the First Amendment to A&R Distribution Agreement or an existing customer of NXC or NXC s reseller or sales agent at the time when the Company seek to sell the QT Breast Scanners directly to the third party, the Company may not sell the Equipment to such third party. It also provides that NXC shall provide the Company with the forecast of the anticipated purchases of QT Breast Scanners during the subsequent twelve-month period no later than forty-five days prior to the end of each calendar quarter, rather than five days prior to the end of each calendar quarter. No changes are made to the amount of the MOQs by the First Amendment to A&R Distribution Agreement, but the MOQs shall not be binding if at any time (a) the Company cannot fulfill the manufacturing and delivery volumes required for NXC to meet the quarterly MOQs, including due to (i) failures or other circumstances attributable to the Company including, but not limited to, issues relating to design or performance of the QT Breast Scanners (e.g., failure of the QT Breast Scanners to meet its published specifications), orders by the FDA or another governmental organization to temporarily or permanently suspend shipments, and to activities or operations of the Company, or (ii) a final non-appealable judgment that Table of Contents would impair the Company s ability to fulfill such manufacturing and distribution volumes as a result of (A) intellectual property infringement made by a third party relating to the QT Breast Scanners or (B) other legal proceedings against the Company; or (b) the Company engage with any competitor or existing customers of NXC or its reseller or sales agent to sell the QT Breast Scanners in violation of the terms of the Amended Distribution Agreement, as amended. Furthermore, the First Amendment to A&R Distribution Agreement provides that in the event NXC is prevented from selling the Equipment due to actions of or attributable to the Company, the Company and NXC will discuss in good faith. Gulf Medical On August 21, 2025, the Company entered into a Distribution Agreement (the Gulf Medical Distribution Agreement ) with Gulf Medical Co., a corporation organized and existing under the laws of Saudi Arabia ( GMC ). Under the terms of the Gulf Medical Distribution Agreement, the Company shall authorize and grant to GMC the exclusive right to market, advertise and sell the QT Breast Scanners and the SaaS platform subscriptions (together with the QT Breast Scanners, the Approved Products ) in Saudi Arabia (the Territory ). The term of the Gulf Medical Distribution Agreement commenced on August 21, 2025, and shall remain in force until August 21, 2028 (the Initial Term ). If GMC has met the Minimum Purchase Requirements (as defined below) during the Initial Term, the Gulf Medical Distribution Agreement shall automatically be extended for an additional one-year term. GMC agrees to meet or exceed the purchase requirements and/or revenue goals for the Approved Products set forth in the Gulf Medical Distribution Agreement (the Minimum Purchase Requirements ) during the Initial Term. Selectively Consider Offshore Marketing Opportunities Other than as discussed with respect to Saudi Arabia, the Company has primarily focused its resources on the U.S. market. However, QT Imaging did commence some marketing initiatives outside the U.S. Pursuant to the Distribution Agreement (the Innovador Distribution Agreement ) between QT Imaging and Innovador Healthcare (Asia) Pte, Ltd. ( Innovador ), dated November 2, 2022, QT Imaging appointed Innovador, based in Singapore, as QT Imaging s distributor for much of Asia. The territory for the Innovador Distribution Agreement included Singapore, Malaysia, Thailand, Indonesia, Philippines, Myanmar, Vietnam,Cambodia, Laos, Brunei, India, Pakistan, Sri Lanka, Bangladesh, Nepal, Mongolia, Taiwan, Hong Kong, and Macau. Under the Innovador Distribution Agreement, QT Imaging is responsible for developing and manufacturing its products and supporting Innovador s product registration and sales and marketing efforts, and Innovador is responsible for product registration, market development, sales & marketing, distribution, and service of the QT Imaging products. Under the Innovador Distribution Agreement, Innovador provides QT Imaging with nonbinding forecasts of the volume of QT Imaging s products it expects to sell each year. Innovador takes possession of any machines it purchases. The initial term of the Innovador Distribution Agreement is three years and is not being renewed. No meaningful sales have yet occurred under the Innovador Distribution Agreement. Our Competitive Strengths We believe that our competitive strengths include the following: The world-wide market for medical imaging is large and it has a potential to expand in the areas where the Company has differentiation: a non-ionizing, non-contrast dye injection imaging modality; an imaging modality with superior performance as compared to traditional mammogram with respect to specificity (false positive), thus less unnecessary emotional trauma for patients, reduced numbers of invasive follow-up procedures and a reduction of costs for both patient and broader society; a lower price point than conventional high-energy imaging equipment; the Company s technology can be deployed to low resources environments ( LREs ) because of its automation, small footprint, no shielding, no contrast-dye injection; the Company s technology is portable and can be used in point-of-care ( POC ) settings such as LREs; and Table of Contents the Company s technology is deployable in outdoor settings such as sports, military, and naval settings. The Company s technology reduces the barriers to testing and follow up-care for women, as there is no need for specialized training and the technology is well-suited for lowering health care costs by being affordable and easily accessed. The Company s technology provides optimized patient experience, as no radiation is involved, with the patient being able to be followed with no limitation to imaging frequency. The Company s technology is well-suited for traditional tertiary care hospitals and additionally for direct to consumer ( DTC ) and direct to practitioner ( DTP ) applications, that are outside these institutions. The Company s technology is uniquely proprietary, disruptive and a one-of-a kind product that can address a variety of unmet medical needs in the medical marketplace. The Company s scanner features a uniquely simple design with a small number of components, which in turn significantly reduces the cost of the bill-of-materials ( BOM ), cost-of-goods-sold ( COGS ) , and the total-cost-of-ownership, and enables a lower average sales price ( ASP ) compared to other available systems, thus making it much more affordable to large mass deployments; and The Company s products have potential strong revenue growth, with capital purchase or subscription-based recurring revenues supporting substantial long-term gross margin. Our Strategies We believe that our strategies include the following: Create disruptive technological innovation (software, artificial intelligence, and smart physics) to improve medical imaging and thus health care quality and access. Continue to improve our high quality, high resolution, native 3D, reproducible image quality regardless of operator or breast size/tissue type breast imaging technology, as well as the techniques for quantifiable analysis, comparison, and training. Build a biomarker-driven Cloud SaaS platform to shift from a hardware company to a precision imaging artificial intelligence platform combining hardware, software and cloud-based artificial intelligence modules. Biomarkers allow us to move beyond detection toward diagnostic and prognostic precision through quantitative imaging. Partner with strategic business and distribution channels to address U.S. market for breast imaging immediately and, other regions in the future, to place the QT Breast Scanner in hospitals, radiology centers, etc. and generate awareness of the benefits of the Company s technology. Perform scale manufacturing internally to the Company and partner strategically for large scale manufacturing. Expand the market by supporting additional DTC and DTP approaches to enable the ability to lower health care costs and increase access via personal medical imaging. Provide a new social and economic opportunity for consumers to take control of some aspects of their own health care such as imaging for minor injuries or medical conditions without needing a healthcare gate-keeper. Focus our intellectual capabilities and ethical framework to become unified in our mission to improve the quality and lower the cost of health care world-wide... It s about time. Table of Contents Leverage on the intellectual property and know-how of the Company as is demonstrated through the first family of QT Breast Scanner commercialization, to develop other scanning medical imaging products, such as infant scanners, full-body scanners and/or other products. Material Agreements Canon Manufacturing Agreement On March 28, 2025, the Company entered into a manufacturing agreement (the Canon Manufacturing Agreement ) with Canon Medical Systems Corporation ( CMSC ). Pursuant to the terms of the Canon Manufacturing Agreement, the Company appointed CMSC as the exclusive manufacture of the QT Breast Scanners to be distributed by NXC pursuant to the Amended Distribution Agreement. CMSC s manufacturing of the QT Breast Scanners shall not include the final testing process for the QT Breast Scanners, and CMSC shall not have any responsibility for the QT Breast Scanner as a manufacturer of medical equipment for FDA purposes. In order for CMSC to manufacture the QT Breast Scanners, the Company shall sell components to CMSC in a timely manner, in accordance with agreed-upon terms and conditions. The Company shall cooperate with and support CMSC to allow CMSC to procure components through its own supply chain. The parties shall negotiate in good faith specific procedures to phase out CMSC s purchase of components from the Company, with the target date of the fourth quarter of 2025, although this is not a commitment. The terms for purchasing components (or subassemblies), including components for service, by the Company from CMSC shall be mutually agreed upon by the parties. The Company shall provide forecasts (each, a Forecast ) to CMSC in accordance with the Forecast Policy attached to the Canon Manufacturing Agreement. No later than forty-five days prior to the end of each calendar quarter, CMSC will notify the Company in writing if CMSC is unable to deliver a sufficient number of QT Breast Scanners to satisfy the Forecast for the following quarter. If CMSC is unable to deliver a sufficient number of QT Breast Scanners due to CMSC s willful misconduct, CMSC will sell back to the Company all components necessary for the Company to engage in the manufacture of the QT Breast Scanners for the following quarter at the Company s facility in Novato, California (hereinafter referred to as Novato Manufacturing ) sufficient to cover the QT Breast Scanner shortfall back at the same purchase price that CMSC paid to purchase such components. CMSC shall bear risk of loss, all fees and shipping costs for the components incurred in connection with such Novato Manufacturing. No later than forty days prior to the end of each calendar quarter, the Company shall notify CMSC in writing indicating whether or not the Company wishes to engage in Novato Manufacturing of the QT Breast Scanners for the following quarter for the purpose of meeting the Forecast for such quarter. If the Company provides such notice to CMSC within the 40-day period, stating that the Company wishes to engage in Novato Manufacturing, the Company may purchase from CMSC (if the Company does not already have) any components held by CMSC necessary as determined by the Company for the Company to be able to manufacture the QT Breast Scanners via the Novato Manufacturing, at the same purchase price that CMSC paid to the Company to purchase such components. The Company shall bear all risk of loss, fees and shipping costs for the components incurred in connection with the Novato Manufacturing. From time to time during the term of the Canon Manufacturing Agreement, but no later than thirty days prior to the delivery date specified in the purchase order, the Company may issue to CMSC a purchase order for any of the QT Breast Scanners necessary to meet the Forecast, for the actual quantities to be delivered by CMSC. Each purchase order shall specify delivery dates that respect the Forecast Policy. The purchase prices applicable to the purchase orders as of the date of the Canon Manufacturing Agreement shall be separately agreed between the parties in writing. CMSC may reject any purchase order that requests delivery dates that are not in compliance with such Forecast Policy. Unless the Company is manufacturing QT Breast Scanners as Novato Manufacturing, any failure by CMSC, as a result of CMSC s conduct, to manufacture and deliver QT Breast Scanners as specified in an accepted purchase order necessary to satisfy the Forecasts later than seventy-five days from the delivery date as specified in the accepted purchase order shall result in liquidated damages per missed or delayed QT Breast Scanner of $220,000, with NXC not being obligated to pay for the missed MOQ sale. Such failure by CMSC shall also not Table of Contents provide any grounds for NXC to terminate the Amended Distribution Agreement or otherwise cancel the binding nature of the MOQs as provided in the Amended Distribution Agreement. All title to and risk of loss of the QT Breast Scanners shall pass from CMSC to the Company when the QT Breast Scanners have been delivered to the Company in Novato, California, under the Incoterms 2020 trade term, DDP. The Company shall make payment of the QT Breast Scanners to CMSC within ninety days after the issuing date of an original copy of the invoice to be issued by CMSC. Unless earlier terminated in accordance with the terms of the Canon Manufacturing Agreement, this agreement shall remain effective until December 31, 2026. In case both parties mutually agree the extension of the Canon Manufacturing Agreement in writing, the Canon Manufacturing Agreement shall be extended for one year after the expiration of the Canon Manufacturing Agreement. In the event of Change of Control of a party, either party shall have the right to, at its sole discretion, terminate the Canon Manufacturing Agreement in its entirety upon forty-five business days prior written notice to the other party. Such notice shall be provided prior to the expiration of the then current term of the Canon Manufacturing Agreement. In the event of the termination or expiration of the Canon Manufacturing Agreement, CMSC will honor all of the outstanding accepted purchase orders, and both parties will cooperate to fulfill such orders. In the event that either party substantially fails to comply with any provision of the Canon Manufacturing Agreement and that such non-compliance has not been cured within thirty business days from the date of its receipt of the written notice from the other party, then the other party shall have the right to terminate the Canon Manufacturing Agreement upon giving a written notice. The Canon Manufacturing Agreement also provides other grounds for its termination prior to December 31, 2026, including by CMSC if NXC s sales of the QT Breast Scanner are adversely affected due to any failures or other circumstances attributable to the Company that Unless earlier terminated in accordance with the terms of the Canon Manufacturing Agreement, this agreement shall remain effective until December 31, 2026. In case both parties mutually agree the extension of the Canon Manufacturing Agreement in writing, the Canon Manufacturing Agreement shall be extended for one year after the expiration of the Canon Manufacturing Agreement. In the event of Change of Control of a party, either party shall have the right to, at its sole discretion, terminate the Canon Manufacturing Agreement in its entirety upon forty-five business days prior written notice to the other party. Such notice shall be provided prior to the expiration of the then current term of the Canon Manufacturing Agreement. In the event of the termination or expiration of the Canon Manufacturing Agreement, CMSC will honor all of the outstanding accepted purchase orders, and both parties will cooperate to fulfill such orders. In the event that either party substantially fails to comply with any provision of the Canon Manufacturing Agreement and that such non-compliance has not been cured within thirty business days from the date of its receipt of the written notice from the other party, then the other party shall have the right to terminate the Canon Manufacturing Agreement upon giving a written notice. The Canon Manufacturing Agreement also provides other grounds for its termination prior to December 31, 2026, including by CMSC if NXC s sales of the QT Breast Scanner are adversely affected due to any failures or other circumstances attributable to the Company that the Company is or is reasonably expected to be unable to remedy (including but not limited to Epidemic Failures; the submission of Medical Device Reports (MDRs) to the FDA regarding the QT Breast Scanner; any action by the Company (either voluntarily or upon an order or request by the FDA) to conduct a Field Correction, Market Withdrawal, Stock Recovery, or Recall (as such terms are defined by the FDA); any action by the Company or any regulatory authority to temporarily suspend shipments or manufacturing of QT Breast Scanners; or issues related to the Company s business operations) within six months from the date of the onset of such an event. For these purposes, Epidemic Failures means a malfunctioning of five or more QT Breast Scanners collectively presumed to have a common underlying cause based on a reasonable evaluation. Following a termination or expiration of the Canon Manufacturing Agreement, the provisions with respect to the grants of licenses to the IPR of the Company will survive up to the earlier of (a) the end of the five-year lifetime of the QT Breast Scanners sold to NXC and (b) December 31, 2031. Lynrock Lake Term Note On February 26, 2025, the Company entered into the Credit Agreement that provides a senior secured term note with Lynrock Lake. The Credit Agreement is secured by a first priority lien on substantially all assets of the Company and its domestic subsidiaries, QT Imaging and QT Ultrasounds Labs, Inc. ( QT Ultrasounds Labs and together with QT Imaging, the Guarantors ), a Delaware corporation, and provides for a term loan in the aggregate principal amount of $10,100,000 at an interest rate of 10.0% per annum, compounded quarterly by adding the Table of Contents amount thereof to the unpaid principal amount. The obligations of the Company under the Credit Agreement are guaranteed by each of the Guarantors. The maturity date of the Credit Agreement is March 31, 2027 (the Maturity Date ). A portion of the proceeds is expected to be used to satisfy the Company s outstanding obligations under the Cable Car Note and the Yorkville Note (each as defined below). The senior secured term loan shall be repaid on the Maturity Date in an amount equal to the aggregate principal amount outstanding, together with all accrued and unpaid principal and any outstanding and payable fees. Subject to the payment of the Make-Whole Amount (as defined in the Credit Agreement), the Company may at any time prior to the Maturity Date optionally prepay the term loan, in full or in part, upon irrevocable written notice of three (3) business days prior to the proposed prepayment; provided that if such prepayment is to be funded with the proceeds of a refinancing or disposition, such notice of prepayment may be revoked if the financing or disposition is not consummated; provided further, that any such prepayment made in connection with, or in anticipation of, a Change of Control (as defined in the Credit Agreement) will also be subject to a prepayment premium equal to 20% of the amount of principal being prepaid (the Prepayment Premium ). Partial prepayments of the term loan shall be in an aggregate principal amount of $250,000 or a whole multiple thereof. Subject to the payment of the Make-Whole Amount (as defined in the Credit Agreement), at the option of Lynrock Lake, the Company will make mandatory repayments of the term loan upon the following occurrences: If on any date the Company or any of its subsidiaries will receive any cash proceeds from any Extraordinary Receipt (as defined in the Credit Agreement) in an amount equal to or exceeding $250,000 in the aggregate, the Company shall prepay the term loan within five (5) business days of receipt of such cash proceeds, in an amount equal to one hundred percent (100%) of the cash proceeds of such Extraordinary Receipt; If any indebtedness will be incurred by the Company or any subsidiary thereof (excluding any indebtedness that the Credit Agreement permits the Company to incur), an amount equal to 100% of the net cash proceeds thereof shall be applied on the date of incurrence or receipt toward the prepayment of the term loan; If on any date the Company or any of its subsidiaries will receive net cash proceeds in an amount equal to or exceeding (i) $250,000 in any single transaction or series of related transactions or (ii) $250,000 in the aggregate for all transactions during the term of the Credit Agreement from any Asset Sale (as defined in the Credit Agreement) or Recovery Event (as defined in the Credit Agreement) then the Company or such subsidiary shall prepay the term loan, on or prior to the date which is five (5) business days after the date of the realization or receipt by the Company or subsidiary in an amount equal to one hundred percent (100%) of such proceeds; and Subject to the payment of the Prepayment Premium in addition to the Make-Whole Amount, in the event that a Change of Control (as defined in the Credit Agreement) will occur, the Company shall prepay all of the outstanding term loan, on or prior to the date which is two (2) business days after the date of such Change of Control (as defined in the Credit Agreement). There are no requirements to make any prepayment in the event that the Company sells any of its capital stock. In addition, at the option of Lynrock Lake, the Company shall also make mandatory repayments of the term loan on a monthly basis, no later than five (5) business days after the end of each month (provided that such date for payment is prior to the Maturity Date), if the Company or its subsidiaries receive payment of accounts receivable on or after January 1, 2026, in an amount equal to fifteen percent (15.0%) of the aggregate amount of payments of accounts receivable actually received during such prior month, net of any cost of collection incurred not in the ordinary course of business. No Make-Whole Amount or Prepayment Premium is due or payable on any such mandatory prepayment as a result of receipt of accounts receivable on or after January 1, 2026. All mandatory prepayments will be accompanied by accrued and unpaid interest to the date of such prepayment on the amount prepaid. Table of Contents The Credit Agreement contains customary affirmative and negative covenants. In connection with the Credit Agreement, the Company will be required to comply with two financial covenants. These financial covenants are (i) a minimum qualified cash covenant of $500,000, and (ii) a minimum shipments and associated revenue and accounts receivable covenant for each quarter with amounts of at least 80% of the forecasted amount in the Company s previously announced distribution agreement. The Company is also required within twelve (12) months of the entry into the Credit Agreement (unless such time period is extended by Lynrock Lake in its reasonable discretion) to create, or cause to be created, a holding company structure reasonably satisfactory to Lynrock Lake. The Credit Agreement also contains customary events of default, such as the failure to pay obligations when due, initiation of bankruptcy or insolvency proceedings, defaults on certain other indebtedness, change of control or breach of representations and warranties or covenants. Upon an event of default, Lynrock Lake may require the immediate payment of all amounts outstanding and foreclose on collateral. Under the Credit Agreement, the Company has also provided Lynrock Lake with a right of first refusal to provide up to twenty-five percent (25%) of any additional indebtedness and/or the sale or issuance of any capital stock. Lynrock Lake shall have the right, but not the obligation, to participate in any such additional financing by the Company or its subsidiaries. On August 26, 2025, the Company and Lynrock Lake entered into an Amended Credit Agreement (the Amended Credit Agreement ) to add an additional tranche of $5,000,000 to the loan ( Tranche B ) and increase the aggregate principal amount of the Term Loans (as defined in the Amended Credit Agreement) to $15,100,000. The proceeds of Tranche B were used to repurchase the Yorkville Warrant from Yorkville pursuant to the terms of a Warrant Repurchase Agreement. The Company has an obligation to pay down Tranche B at a premium out of net cash proceeds which the Company may raise via issuance of the Company s Common Stock. On October 6, 2025, the Company repaid the Tranche B loan in the amount of $5.0 million, plus accrued interest and a 6% premium. Lynrock Lake Warrant Furthermore, in connection with the Lynrock Lake Term Loan, the Company issued the Lynrock Lake Warrant to Lynrock Lake. The Lynrock Lake Warrant is exercisable until February 26, 2035. Lynrock Lake may cashless exercise the Lynrock Lake Warrant. The Lynrock Lake Warrant is also subject to anti-dilution adjustments to the exercise price and the number of shares which may be purchased upon exercise of the Lynrock Lake Warrant in the event that the Company issues shares of Common Stock (or derivative securities) at a price that is either less than the $1.20 exercise price following the Reverse Stock Split or the fair market value of a share of Common Stock from the immediately prior trading day. Extinguishment of Yorkville Note and Issuance of Warrant On November 16, 2023, the Company entered into a Standby Equity Purchase Agreement (the SEPA ) with YA II PN, Ltd., a Cayman Islands exempt limited partnership ( Yorkville ), pursuant to which Yorkville agreed, subject to the conditions therein, to purchase from the Company shares of its Common Stock for a value of up to $50,000,000 of which $10,000,000 was to be advanced by Yorkville as evidenced by a promissory note (such advance, the Pre-Paid Advance ). Furthermore, as previously disclosed by the Company in a Current Report on Form 8-K filed on March 5, 2024 with the SEC, the Company, as consideration for the Pre-Paid Advance, on March 4, 2024 issued to Yorkville a promissory note (the Yorkville Note , and together with the SEPA, the Yorkville Financing Documents ). The parties subsequently amended the Yorkville Financing Documents pursuant to that certain First Amendment to the Yorkville Financing Documents, dated September 26, 2024 (the First Amendment ), that certain Second Amendment, dated October 31, 2024 to the Yorkville Financing Documents (the Second Amendment ), and that certain Third Amendment, dated January 9, 2025 (the Third Amendment ). On February 26, 2025, the Company used a portion of the proceeds of the Lynrock Lake Term Loan to pay Yorkville an amount equal to $3,000,000 in cash and issued to Yorkville warrants, which if the Reverse Stock Split had occurred prior to the time of such issuance, would have been warrants to purchase 15,000,000 shares of its Common Stock at an exercise price of per share (and following the Reverse Stock Split, 5,000,071 shares of its Table of Contents Common Stock at an exercise price of $1.20 per share) pursuant to a Warrant to Purchase Common Stock (the Yorkville Warrant ) to fully settle and discharge the Company s obligations under the Yorkville Note and extinguish the Yorkville Note as having been fully performed. The Yorkville Warrant was exercisable until February 26, 2030. The Yorkville Warrant was also subject to adjustments in the event that the Company s Common Stock undergoes a split, reverse-split or similar event. Furthermore, the Yorkville Warrant has provided the holder with piggyback registration rights. The Company used the proceeds of Tranche B of the Amended Credit Agreement to repurchase the Yorkville Warrant for an aggregate price of $5.0 million. The Company and Yorkville also entered into that certain Termination Agreement, dated February 26, 2025 (the Termination Agreement ), pursuant to which the parties acknowledged the termination of the SEPA and the other Yorkville Financing Documents, effective as of February 26, 2025, as result of all parties having performed their obligations owing thereunder. Notwithstanding the termination, all indemnification obligations of the Company and its subsidiaries set forth in the Yorkville Financing Documents shall survive the termination of the Yorkville Financing Documents and continue in full force and effect in accordance with the terms thereof. Extinguishment of Cable Car Note On March 5, 2024 and January 10, 2025, the Company entered into a Secured Convertible Note, dated March 4, 2024, with Funicular Funds, LP ( Cable Car ), providing for an original principal amount of $1,500,000, and subsequently amended on January 9, 2025, by an Omnibus Amendment (as amended, the Cable Car Note ). On February 26, 2025, the Company used a portion of the proceeds of the Lynrock Lake Term Loan to pay Cable Car an amount equal to the full principal, interest and fees amount of approximately $1,625,000 in cash to fully settle and discharge the Company s obligations under the Cable Car Note and extinguish the Cable Car Note as having been fully performed. Private Placements On April 9, 2025, the Company completed the First Private Placement, pursuant to the terms and conditions of the First Securities Purchase Agreement, dated April 9, 2025, by and between the Company and the First Purchasers. Pursuant to the First Securities Purchase Agreement, the Company entered into the First Registration Rights Agreement with the First Purchasers, dated April 9, 2025. The aggregate gross proceeds to the Company from the First Private Placement were approximately $500,000, before deducting the placement agent fees and other offering expenses payable by the Company. On May 12, 2025, the Company completed the Second Private Placement, pursuant to the terms and conditions of the Second Securities Purchase Agreement, dated May 12, 2025, by and between the company and the Second Purchaser. Pursuant to the Second Securities Purchase Agreement, the Company entered into the Second Registration Rights Agreement with the Second Purchaser, dated May 12, 2025. The aggregate gross proceeds to the Company from the Second Private Placement were approximately $200,000, before deducting the placement agent fees and other offering expenses payable by the Company. On October 3, 2025, the Company completed the Third Private Placement, pursuant to the terms and conditions of the Third Securities Purchase Agreement, dated September 30, 2025, by and between the Company and the Third Purchasers. Pursuant to the Third Securities Purchase Agreement, the Company entered into a Third Registration Rights Agreement with the Third Purchasers, dated September 30, 2025. The aggregate gross proceeds to the Company from the Third Private Placement were approximately $18,180,655, before deducting the placement agent fees and other offering expenses payable by the Company. Corporate Information GigCapital5, our predecessor company, was incorporated in the State of Delaware in January 2021 for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination involving GigCapital5 and one or more businesses. GigCapital5 completed its initial public offering in September 2021. Table of Contents We have two wholly owned operating subsidiaries: QT Imaging, Inc. and QT Ultrasound Labs, Inc. QT Imaging was initially incorporated under the laws of the State of Delaware 2012. In March 2024, Merger Sub merged with and into QT Imaging, and QT Imaging as the Surviving Corporation became a wholly-owned direct subsidiary of GigCapital5. In connection with the Merger, GigCapital5 changed its name to QT Imaging Holdings, Inc. The corporate office of QT Imaging Holdings, Inc. is located at 3 Hamilton Landing, Suite 160, Novato, CA 94949 and its telephone number is (415) 842-7250. Implications of Being an Emerging Growth Company and a Smaller Reporting Company We are an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 (the Jobs Act ). We will remain an emerging growth company under the JOBS Act until the earliest of (i) the last day of our first fiscal year (a) following the fifth anniversary of GigCapital5 s IPO (September 28, 2026), (b) in which we have total annual gross revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer under the rules of the SEC with at least $700.0 million of outstanding securities held by non-affiliates; and (ii) the date on which we have issued more than $1.00 billion in non-convertible debt securities during the prior three-year period. We are also a smaller reporting company as defined in the Securities and Exchange Act. We may continue to be a smaller reporting company even after we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as the market value of our voting and non-voting Common Stock held by non-affiliates is less than $250.0 million measured on the last business day of our second fiscal quarter, or our annual revenue is less than $100.0 million during the most recently completed fiscal year and the market value of our voting and non-voting Common Stock held by non-affiliates is less than $700.0 million measured on the last business day of our second fiscal quarter. As a result, the information in this prospectus and that we provide to our investors in the future may be different than what you might receive from other public reporting companies. Table of Contents THE OFFERING Issuer QT Imaging Holdings, Inc. (f/k/a GigCapital5, Inc.). Shares of Common Stock Offered by the Selling Stockholder We are registering the resale by the Selling Securityholders of up to 29,336,017 shares of Common Stock, consisting of (i) 2,562,334 Common Shares and (ii) 26,773,683 Warrant Shares issuable on the exercise of the warrants held by the Selling Securityholders. Terms of the Offering The Selling Securityholders will determine when and how they will dispose of the shares of Common Stock registered under this prospectus for resale. Shares Outstanding Prior to the Offering As of December 26, 2025, we had 11,902,198 shares of Common Stock issued and outstanding. Shares Outstanding After the Offering 38,667,630 shares of Common Stock (assuming the exercise for cash of Warrants to purchase 26,773,683 Warrant Shares). Use of Proceeds We will not receive any proceeds from the sale of shares of Common Stock by the Selling Securityholders. With respect to the Warrant Shares, we will not receive any proceeds from the sale of such shares but we will receive such amounts that are paid to us upon the exercise of the Warrants to the extent such Warrants are exercised for cash. We intend to use such proceeds received from the exercise of the Warrants, if any, for working capital and general corporate purposes. See the Section entitled Use of Proceeds. Market for Common Stock Our Common Stock is traded in the OTC Market OTCQB under the symbol QTIH. For additional information concerning the offering, see Plan of Distribution beginning on page 198.
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+As filed with the Securities and Exchange Commission on September 15, 2025 Registration No. 333- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM F-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ReTo Eco-Solutions, Inc. (Exact name of Registrant as specified in its charter) Not Applicable (Translation of Registrant s name into English) British Virgin Islands 3290 Not Applicable (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) X-702, Tower A, 60 Anli Road, Chaoyang District Beijing, People s Republic of China 100101 Tel: (+86) 10-64827328 (Address, including zip code, and telephone number, including area code, of Registrant s principal executive offices) Vcorp Agent Services, Inc. 25 Robert Pitt Dr., Suite 204 Monsey, New York 10952 Tel: (888) 528-2677 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies of Correspondence to: Wei Wang, Esq. Ellenoff Grossman & Schole LLP 1345 Avenue of the Americas New York, NY 10105 Phone: (212) 370-1300 Fax: (212) 370-7889 Approximate date of commencement of proposed sale to the public: From time to time after this registration statement becomes effective. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933. Emerging growth company If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. The term new or revised financial accounting standard refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012. The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. The information in this prospectus is not complete and may be changed. The selling shareholder cannot sell these securities until the registration statement that we have filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where their offer or sale is not permitted. PRELIMINARY PROSPECTUS SUBJECT TO COMPLETION, DATED SEPTEMBER 15, 2025 ReTo Eco-Solutions, Inc. 10,663,612 Class A Shares This prospectus relates to the resale by Streeterville Capital, LLC (the Selling Shareholder ), from time to time, of up to an aggregate of 10,663,612 Class A shares, no par value per share (the Class A Shares ), of ReTo Eco-Solutions, Inc. ( ReTo, collectively with its consolidated subsidiaries, the Company, we, us, our or similar terminology), consisting of (i) 28,612 Class A Shares issued to the Selling Shareholder as consideration for the Selling Shareholder s commitment (the Commitment Shares ) pursuant to a Securities Purchase Agreement, dated as of June 16, 2025 (the Securities Purchase Agreement ), by and between ReTo and the Selling Shareholder, (ii) 635,000 Class A Shares issued to the Selling Shareholder (the Pre-Delivery Shares ) and (iii) 10,000,000 Class A Shares potentially issuable to the Selling Shareholder in satisfaction of pre-paid purchase balances outstanding from time to time under the Securities Purchase Agreement, subject to a beneficial ownership
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+PROSPECTUS SUMMARY This summary highlights selected information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before deciding to invest in our Ordinary Shares, you should read this entire prospectus carefully, including the sections of this prospectus entitled "Risk Factors" and "Management s Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and the related notes included elsewhere in this prospectus. Unless the context otherwise requires, references in this prospectus to the "Company," "Regentis," "we," "us," "our" and other similar designations refer to Regentis Biomaterials Ltd. Company Overview We are a regenerative medicine company dedicated to developing innovative tissue repair solutions that seek to restore the health and enhance the quality of life of patients. Our current efforts are focused on orthopedic treatments using our Gelrin platform based on degradable hydrogel implants to regenerate damaged or diseased tissue. Gelrin is a unique hydrogel matrix of polyethylene glycol diacrylate (a polymer involved in tissue engineering) and denatured fibrinogen (a biologically inactivated protein that normally has a role in blood clotting). Our lead product candidate is GelrinC, a cell-free, off-the-shelf hydrogel that is cured into an implant in the knee for the treatment of painful injuries to articular knee cartilage. GelrinC was approved as a device, with a Conformit Europ ene, or CE, mark in Europe, in 2017 (number 3900600CE02); we plan to identify strategic partners in Europe to bring our product to market. While we currently do not have any strategic partners in place in Europe, we plan to engage strategic partners in Europe in the future. With GelrinC, we aim to bring to market a product for the therapy of an unmet need for the large market of cartilage injuries in the knee. Because GelrinC serves as an impenetrable barrier that stops cells from migrating away from the wound s edges, we believe our product is the only product that helps to regenerate cartilage inwards from the edges of the cell walls. Creating new contiguous tissue is not the natural, lowest energy, alternative for cartilage cells. If such cells were left alone, they would tend to migrate and either not create new cartilage tissue or create cartilage tissue that is fibrotic (containing an excessive deposition of extracellular matrix, leading gradually to the disturbance and finally to loss of the original tissue architecture and function). By GelrinC creating such impenetrable barrier and thereby preventing the migration of the cells, the cells are forced to take a different route of creating aggregate and contiguous tissue. Unlike GelrinC, cellular products used by competing companies require a plug of two layers of which the lower layer is a mineral scaffold, which is a foreign body material that has been engineered to be inserted into the bone tissue even though the bone is often healthy. Additionally, GelrinC does not have any biological activity. As a result, we believe our product offers a simple and economic procedure, which we believe will allow patients to recover quickly with potentially long-term outcomes. Market Opportunities Knee cartilage injuries can be caused either by acute or repetitive trauma due to daily function, including those caused by sports activity. Knee cartilage does not usually heal by itself when injured. Without treatment, cartilage injuries may progress and cause degeneration of joints, osteoarthritis, and possibly require total knee replacement. Currently, the standard of care procedure for cartilage injuries is microfracture surgery, which involves cleanup of the wound and creation of tiny punctures in the underlying bone. Microfracture surgery provides only short-term relief to patients and often requires additional surgical intervention later since the cartilage resulting from this procedure tends to be fibrous and not as weight bearing as natural hyaline cartilage. Because the cartilage produced from microfracture surgery tends to be fibrous, the cartilage is more prone to deterioration after a short period of time, with such relief from microfracture surgery lasting on average between nine to twelve months, according to Medline Plus online health information resource, medical encyclopedia. Unlike microfracture surgery, treatment using GelrinC does not produce fibrous cartilage, but instead has been shown to grow hyalin cartilage, which is autologous to the natural cartilage of the patient. While determinations of safety and efficacy are solely within the authority of the United States Food and Drug Administration, or the FDA, and comparable regulatory bodies, we believe that in our clinical trials, GelrinC has been shown to have potentially longer-term positive outcomes of up to four years. As evidenced by a pilot study we completed in 2015 in northern Europe, or the Pilot Study, patients reported greater improvement and pain reduction regarding their knee and associated problems for GelrinC at two years when compared to historical microfracture procedure data at two years. Additionally, patients continued to report further improvement and greater pain reduction of their knee and associated problems using GelrinC for four years. See "Business – Clinical Development of GelrinC – Completed Pilot Study" below. Beyond microfracture surgery, current commercial therapies for cartilage repair involve the use of autologous cells harvested from the patient s own healthy tissue. This approach has numerous disadvantages, including the need for expensive cell expansion facilities and the requirement for two surgical procedures. 1 Strategy & Solution We aim to provide patients with safe, effective, simple, and lasting treatments that are cost effective. With our lead product, GelrinC, patients may be treated for cartilage injuries in the knee with an off-the-shelf product by a short and simple procedure that we believe will be cost effective. We believe that our Gelrin technology platform may also provide a solution to osteoarthritis and other cartilage injuries related to the ankle, wrist, and elbow. Gelrin is a family of hydrogels that derive their unique physical and chemical properties from polymer chains crosslinked with trace quantities of denatured protein. In the body, Gelrin is eroded and resorbed over time through a pre-programmed and controlled gradual surface degradation process. Gelrin can be applied in liquid form allowing it to completely fill the entire tissue defect and is then cured into a rubbery implant by the use of ultraviolet light. It can also be introduced into narrow bone crevices or large spaces, open or closed. GelrinC is specifically designed for the repair of articular cartilage defects in the knee caused by acute trauma or repetitive use. We believe that GelrinC will offer a cost effective, off-the-shelf product that will be simple to use, requiring approximately a 10-minute procedure and a two-week recovery period. Research and Clinical Development We believe that the cartilage repair market is in need for an off-the-shelf solution, which it currently lacks. GelrinC, being an off-the-shelf product, requiring a short procedure, believed by us to be easy to use by the surgeon and having efficient economics answer those needs very effectively. In both pre-clinical and clinical studies, all of these advantages were effectively demonstrated resulting in our decision to choose GelrinC as our lead product candidate. In the Pilot Study we completed on 56 patients, it was demonstrated that GelrinC reduced pain significantly better than the leading gold standard procedure of microfracture. Currently, the Company is conducting a pivotal trial and has recruited and treated 47 patients for such trial (out of 80 total patients required in order to submit the pre-market approval application, or PMA, to the Food and Drug Administration, or the FDA). 41 patients out of the 47 patients recruited so far have completed the two-year follow up in this trial. Following this offering, the Company plans to enroll the remaining 39 patients and expects to complete this enrollment by the end of 2025. Having grown out of research from The Technion Israel Institute of Technology, our commitment to research and innovation is best witnessed by the development we carried out on GelrinC to date from the underlying science and our close relationship with our founder Professor Dror Seliktar of The Technion, Israel Institute of Technology in Haifa, Israel. We believe we have the leadership onboard to continue to build our product lines. In the Pilot Study, 56 patients who complied with the acceptance and rejection criteria allowed by the FDA (which included age, size of lesion and weight) in need of cartilage repair were treated with GelrinC for articular cartilage injuries. The improvements observed in the Knee Injury and Osteoarthritis Outcome Score, or KOOS, and Virtual Analog Scale, or VAS, pain measurement scores taken over two years following the treatment were superior (100% greater improvement) to those seen with the traditional microfracture procedure, which is considered to be the current "gold standard". Additionally, patients continued to report further improvement and greater pain reduction of their knee and associated problems using GelrinC for four years. Based on these results, the FDA granted Regentis an investigational device exemption, or IDE, in September 2016 for our pivotal trial, permitting PMA submission with two-year follow-up data of 80 patients and with 40 additional patients to be treated thereafter. The pivotal trial that is currently being conducted in the United States and in Europe, under the FDA s sanctioned protocol, is an open label study, with one arm only (treatment), using our own historical control (microfracture). To-date, we have treated 47 patients out of the 80 initial patients which are required to submit our PMA to the FDA. We intend to develop a pipeline of products that can be used for additional tissue regeneration opportunities. 2 Summary Risk Factors Investing in our securities involves substantial risk. The risks described under the heading "Risk Factors" immediately following this summary may cause us to not realize the full benefits of our strengths or may cause us to be unable to successfully execute all or part of our strategy. Some of the more significant challenges include the following: Risks Related to Our Financial Condition and Capital Requirements We have a limited operating history and we have incurred significant operating losses since our inception, and anticipate that we will incur continued losses for the foreseeable future. We have not generated any revenue from product sales and may never be profitable. Even if this offering is successful, we will need to raise substantial additional funding, which may not be available on acceptable terms, or at all. Failure to obtain funding on acceptable terms and on a timely basis may require us to curtail, delay or discontinue our product development efforts or other operations. Our financial statements contain an explanatory paragraph regarding substantial doubt about our ability to continue as a going concern, which could prevent us from obtaining new financing on reasonable terms or at all. Risks Related to Our Business and Industry We may not succeed in advancing the development of our product, achieve manufacturing stability and capacity, demonstrate sufficient clinical evidence or commercialize our product and generate significant revenues. Clinical failure can occur at any stage of clinical development. Our clinical experience to date does not necessarily predict future results and may not have revealed certain potential limitations of the technology and potential complications from GelrinC and may require further clinical validation. Any product version we advance through clinical trials may not have favorable results in later clinical trials or may not receive a regulatory approval. We operate in a very competitive business environment, and if we are unable to compete successfully against our existing or potential competitors, our business, financial condition and results of operations may be adversely affected. We expect to derive most of our revenues from the sales of GelrinC. Our inability to successfully commercialize this product candidate or any subsequent decline in demand for this product candidate, could severely harm our ability to generate revenues. If healthcare professionals do not recommend our product to their patients, GelrinC may not achieve market acceptance and we may not become profitable We are dependent upon contract manufacturing organizations and raw material suppliers making us vulnerable to supply shortages and problems, increased costs and quality or compliance issues, any of which could harm our business. We may not be able to replace our current manufacturing capabilities in a timely manner. Our business plan is dependent upon third-party service providers. If such third-party service providers fail to maintain a high quality of service, the utility of our products could be impaired, which could adversely affect the penetration of our products, our business, operating results and reputation in the future. 3 Our business plan relies on certain assumptions about the market for our product, however, the size and expected growth of our addressable market has not been established with precision and may be smaller than we estimate, and even if the addressable market is as large as we have estimated, we may not be able to capture additional market share. We depend on third parties to manage our clinical studies and trials, perform related data collection and analysis, and to enroll patients for our clinical trials, and, as a result, we may face costs and delays that are beyond our control. We may not be able to generate sufficient cash to service all of our indebtedness and may be forced to take other actions to satisfy our obligations under our indebtedness, which may not be successful. Our business, operating results and growth rates may be adversely affected by current or future unfavorable economic and market conditions and adverse developments with respect to financial institutions and associated liquidity risk. We are highly dependent on key members of our executive management team. Our inability to retain these individuals could impede our business plan and growth strategies, which could have a negative impact on our business and the value of your investment. Exchange rate fluctuations between the U.S. dollar and the New Israeli Shekel and inflation may negatively affect our results of operations, and we may not be able to hedge our currency exchange risks successfully. The outcome of any future claims and litigation could have a material adverse impact on our business, financial condition and results of operations. Certain of our directors, director nominees and/or officers may have interests that compete with ours and our shareholders. Our management team has limited experience managing a public company. Risks Related to Our Reliance on Third Parties We will rely on third parties to conduct certain elements of our preclinical studies and clinical trials and perform other tasks for us. If these third parties do not successfully carry out their contractual duties, meet expected deadlines or comply with regulatory requirements, we may not be able to obtain regulatory approval for or commercialize our product candidates. Independent clinical investigators and clinical research organization, or CROs, that we will engage to conduct our clinical trials may not devote sufficient time or attention to our clinical trials or be able to repeat their past success. We rely on third parties to manufacture the raw materials that we use to create our product candidates. Our business could be harmed if existing and prospective third parties fail to provide us with sufficient quantities of these materials and products or fail to do so at acceptable quality levels or prices. Our reliance on third parties requires us to share our trade secrets and intellectual property, which increases the possibility that a competitor will discover them or that our trade secrets and intellectual property will be misappropriated or disclosed. 4 Risks Related to Our Intellectual Property If we are unable to obtain patent protection for our products, or if our patents and other intellectual property rights do not adequately protect our products, we may be unable to gain significant market share and may be unable to operate our business profitably. Obtaining and maintaining patent protection depends on compliance with various procedures, document submission, fee payment and other requirements imposed by governmental patent agencies, and our patent protection could be reduced or eliminated for non-compliance with these requirements. Although we are not presently a party to lawsuits or administrative proceedings involving patents or other intellectual property, the possibility exists that we may be in the future. If we were to lose any future intellectual property lawsuits, a court could require us to pay significant damages and/or prevent us from selling our products. If we fail to execute invention assignment agreements with our employees and contractors involved in the development of intellectual property or are unable to protect the confidentiality of our trade secrets, the value of our products and our business and competitive position could be harmed. If our trademarks and trade names are not adequately protected, we may not be able to build name recognition in our markets of interest and our competitive position may be harmed. Patent terms may not be sufficient to effectively protect our products and business for an adequate period of time. Our patent portfolio has expiration dates between 2025 and 2036; if we are unable to obtain significant patent protection for our products, or if our patents and other intellectual property rights do not adequately protect our products, we may be unable to gain significant market share and be unable to operate our business profitably. Changes in U.S. patent laws may limit our ability to obtain, defend and/or enforce our patents. We may be unable to enforce our intellectual property rights throughout the world. We may be subject to claims that we or our employees have misappropriated the intellectual property of a third party, including trade secrets or know-how, or are in breach of non-competition or non-solicitation agreements with our competitors and third parties may claim an ownership interest in intellectual property we regard as our own. We may be subject to claims that we or our employees have misappropriated the intellectual property of a third party, including trade secrets or know-how, or are in breach of non-competition or non-solicitation agreements with our competitors and third parties may claim an ownership interest in intellectual property we regard as our own. 5 Risks Related to Government Regulation Our product candidates and operations are subject to extensive government regulation and oversight both in the United States and abroad, and our failure to comply with applicable requirements could harm our business. We may not receive, or may be delayed in receiving, the necessary clearances or approvals for our future products, and failure to timely obtain necessary clearances or approvals for our future products would adversely affect our ability to grow our business. Failure to comply with post-marketing regulatory requirements could subject us to enforcement actions, including substantial penalties, and might require us to recall or withdraw a product from the market. Our products must be manufactured in accordance with federal, state and foreign regulations, and we could be forced to recall our devices or terminate production if we fail to comply with these regulations. The misuse or off-label use of our products may harm our reputation in the marketplace, result in injuries that lead to product liability suits or result in costly investigations, fines or sanctions by regulatory bodies if we are deemed to have engaged in the promotion of these uses, any of which could be costly to our business. Our products may cause or contribute to adverse medical events or be subject to failures or malfunctions that we are required to report to the FDA, and if we fail to do so, we would be subject to sanctions that could harm our reputation, business, financial condition and results of operations. The discovery of serious safety issues with our products, or a recall of our products either voluntarily or at the direction of the FDA or another governmental authority, could have a negative impact on us. Our relationships with customers and third-party payors will be subject to applicable anti-kickback, fraud and abuse and other healthcare laws and regulations, which could expose us to criminal sanctions, civil penalties, contractual damages, reputational harm and diminished profits and future earnings. Changes in laws or regulations relating to data protection, or any actual or perceived failure by us to comply with such laws and regulations or our privacy policies, could materially and adversely affect our business or could lead to government enforcement actions and significant penalties against us, and adversely impact our operating results. If we do not obtain and maintain international regulatory registrations, clearances or approvals for our products, we will be unable to market and sell our products outside of the United States. Legislative or regulatory reforms in the United States or the European Union, or the EU, may make it more difficult and costly for us to obtain regulatory clearances or approvals for our products or to manufacture, market or distribute our products after approval is obtained. Healthcare reform laws could adversely affect our products and financial condition. Disruptions at the FDA and other government agencies caused by funding shortages or global health concerns could hinder their ability to hire, retain or deploy key leadership and other personnel, or otherwise prevent new or modified products from being developed, cleared or approved or commercialized in a timely manner or at all, which could negatively impact our business. 6 Risks Related to this Offering and Investment in Our Ordinary Shares An active, liquid and orderly trading market for our Ordinary Shares may not develop, which may inhibit the ability of our shareholders to sell Ordinary Shares following this offering. The market price of our Ordinary Shares may be volatile, which could result in substantial losses for investors purchasing shares in this offering. If our operating and financial performance in any given period does not meet any guidance that we provide to the public, the market price of our Ordinary Shares may decline. Certain recent initial public offerings of companies with public floats comparable to the anticipated public float of Regentis have experienced extreme volatility that was seemingly unrelated to the underlying performance of the respective company. If our operating and financial performance in any given period does not meet any guidance that we provide to the public, the market price of our Ordinary Shares may decline. If securities analysts do not publish research or reports about our business or if they publish negative evaluations of our shares, the price of our shares could decline. If securities analysts do not publish research or reports about our business or if they publish negative evaluations of our shares, the price of our shares could decline. Future sales of our Ordinary Shares could reduce the market price of our Ordinary Shares. We have not paid dividends in the past and do not expect to pay dividends in the future, and, as a result, any return on investment may be limited to the value of our shares. If we do raise additional capital, shareholders may be subject to dilution. Insiders will continue to have substantial influence over us after this offering, which could limit your ability to affect the outcome of key transactions, including a change of control. The JOBS Act, allows us to postpone the date by which we must comply with some of the laws and regulations intended to protect investors and to reduce the amount of information we provide in our reports filed with the SEC, which could undermine investor confidence in our company and adversely affect the market price of our ADSs or our Ordinary Shares. As a "foreign private issuer" we are permitted to and follow certain home country corporate governance practices instead of otherwise applicable SEC and NYSE American requirements, which may result in less protection than is accorded to investors under rules applicable to domestic U.S. issuers. We may be a "passive foreign investment company," or PFIC, for U.S. federal income tax purposes in the current taxable year or may become one in any subsequent taxable year. There generally would be negative tax consequences for U.S. taxpayers that are holders of our Ordinary Shares if we are or were to become a PFIC. We have broad discretion to determine how to use the funds raised in this offering, and may use them in ways that may not enhance our operating results or the price of our Ordinary Shares. New investors purchasing our securities will experience immediate and substantial dilution 7 Risks Related to Israeli Law and Our Operations in Israel Political, economic and military instability in the State of Israel, including as a result of the "Iron Swords" war on Israel, where our headquarters, members of our management team and our research and development facilities are located, may adversely affect our results of operations. Our operations may be disrupted as a result of the obligation of management or key personnel to perform military service. The termination or reduction of tax and other incentives that the Israeli government provides to Israeli companies may increase our costs and taxes. We may be required to pay monetary remuneration to our Israeli employees for their inventions, even if the rights to such inventions have been duly assigned to us. We received Israeli government grants for certain of our research and development activities, the terms of which may require us to pay royalties and to satisfy specified conditions in order to manufacture products and transfer technologies outside of Israel. If we fail to satisfy these conditions, we may be required to pay penalties and refund grants previously received. We may not be able to enforce covenants not-to-compete under current Israeli law that might result in added competition for our products. Provisions of Israeli law and our amended and restated articles of association to be in effect upon the completion of this offering may delay, prevent or otherwise impede a merger with, or an acquisition of, us, which could prevent a change of control, even when the terms of such a transaction are favorable to us and our shareholders. It may be difficult to enforce a judgment of a U.S. court against us and our executive officers and directors and the Israeli experts named in this prospectus in Israel or the United States, to assert U.S. securities laws claims in Israel or to serve process on our executive officers and directors and these experts. Your rights and responsibilities as a shareholder will be governed in key respects by Israeli law, which differs in some material respects from the rights and responsibilities of shareholders of U.S. companies. 8 Corporate Information We are an Israeli corporation based in Israel and incorporated in 2004. Our address is 60 Medinat Hayehudim, Herzliya 4676652, Israel. Our telephone number is +972.9.960.1917. Our website address is www.regentis.co.il. The information contained on our website and available through our website is not incorporated by reference into and should not be considered a part of this prospectus, and the reference to our website in this prospectus is an inactive textual reference only. Implications of Being an "Emerging Growth Company" and a "Foreign Private Issuer" Emerging Growth Company As a company with less than $1.235 billion in revenue during our last fiscal year, we qualify as an "emerging growth company" as defined in the JOBS Act. An emerging growth company may take advantage of specified reduced reporting and other burdens that are otherwise applicable generally to public companies. In particular, as an emerging growth company, we: may present only two years of audited financial statements and only two years of related Management s Discussion and Analysis of Financial Condition and Results of Operations disclosure in our initial registration statement; are not required to provide a detailed narrative disclosure discussing our compensation principles, objectives and elements and analyzing how those elements fit with our principles and objectives, which is commonly referred to as "compensation discussion and analysis"; are not required to obtain a non-binding advisory vote from our shareholders on executive compensation or golden parachute arrangements (commonly referred to as the "say-on-pay," "say-on frequency" and "say-on-golden-parachute" votes); are exempt from certain executive compensation disclosure provisions requiring a pay-for-performance graph and chief executive officer pay ratio disclosure; and are exempt from the auditor attestation requirement in the assessment of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002. 9 We may take advantage of these provisions for up to five years or such earlier time that we are no longer an emerging growth company. We would cease to be an emerging growth company upon the earlier to occur of: (1) the last day of the fiscal year in which we have total annual gross revenues of $1.235 billion or more; (2) the date on which we have issued more than $1.0 billion in nonconvertible debt during the previous three years; or (3) the date on which we are deemed to be a large accelerated filer under the rules of the SEC. We may choose to take advantage of some but not all of these reduced burdens, and therefore the information that we provide holders of our Ordinary Shares may be different than the information you might receive from other public companies in which you hold equity. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards applicable to public companies. We have elected to take advantage of the extended transition period to comply with new or revised accounting standards and to adopt certain of the reduced disclosure requirements available to emerging growth companies. As a result of the accounting standards election, we will not be subject to the same implementation timing for new or revised accounting standards as other public companies that are not emerging growth companies which may make comparison of our financials to those of other public companies more difficult. In addition, the information that we provide in this prospectus may be different than the information you may receive from other public companies in which you hold equity interests. Foreign Private Issuer Upon consummation of this offering, we will report under the Securities Exchange Act of 1934, as amended, or the Exchange Act, as a non-U.S. company with foreign private issuer status. Even after we no longer qualify as an emerging growth company, as long as we continue to qualify as a foreign private issuer under the Exchange Act, we will be exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies, including: the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations with respect to a security registered under the Exchange Act; the sections of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q containing unaudited financial statements and other specified information, and current reports on Form 8-K upon the occurrence of specified significant events. We will be required to file an annual report on Form 20-F within four months of the end of each fiscal year. In addition, we intend to publish our results on a quarterly basis through press releases, distributed pursuant to the rules and regulations of the NYSE American. Press releases relating to financial results and material events will also be furnished to the SEC on Form 6-K. However, the information we are required to file with or furnish to the SEC will be less extensive and less timely compared to that required to be filed with the SEC by U.S. domestic issuers. As a result, you may not be afforded the same protections or information, which would be made available to you, were you investing in a U.S. domestic issuer. We may take advantage of these exemptions until such time as we are no longer a foreign private issuer. We would cease to be a foreign private issuer at such time as more than 50% of our outstanding voting securities are held by U.S. residents and any of the following three circumstances applies: (i) the majority of our executive officers or directors are U.S. citizens or residents; (ii) more than 50% of our assets are located in the United States; or (iii) our business is administered principally in the United States. Both foreign private issuers and emerging growth companies are also exempt from certain more stringent executive compensation disclosure rules. Thus, even if we no longer qualify as an emerging growth company, but remain a foreign private issuer, we will continue to be exempt from the more stringent compensation disclosures required of companies that are neither an emerging growth company nor a foreign private issuer. 10
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+PROSPECTUS SUMMARY This prospectus summary highlights selected information appearing elsewhere in this prospectus and in documents we file with the SEC that are incorporated by reference in this prospectus. Because it is a summary, it may not contain all of the information that may be important to you. To understand this offering fully, you should read this entire prospectus carefully, including the information incorporated by reference herein, the information set forth under the heading Risk Factors and our financial statements and the related notes thereto incorporated by reference in this prospectus. Overview We are a clinical stage biopharmaceutical company focused on developing novel therapies for the treatment of orphan pulmonary and fibrosis indications with no approved or limited effective treatments. We currently have two product candidates in clinical development, LTI-03 and LTI-01, and multiple candidates in preclinical development focused on fibrosis indications. Our lead product candidate is LTI-03, a peptide for which we conducted a Phase 1b dose-ranging, placebo-controlled safety, tolerability, and pharmacodynamic biomarker activity trial in development for the treatment of Idiopathic Pulmonary Fibrosis that has demonstrated the ability in both preclinical studies and clinical trials to protect healthy lung epithelial cells and reduce pro-fibrotic signaling. Our second product candidate is LTI-01, a proenzyme that completed a Phase 2a dose-ranging, placebo-controlled trial and a Phase 1b safety, tolerability and proof of mechanism trial in loculated pleural effusion patients, an indication that has no approved drug treatment. In June 2024, we decided to temporarily delay clinical development of LTI-01 in an effort to focus our resources on clinical development of LTI-03 and until additional funds are raised. In the fourth quarter of 2024, we determined that the temporary delay of further clinical development of LTI-01 may not be a short-term measure. In July 2025, we received a clinical hold letter from the U.S. Food and Drug Administration (the FDA ) with respect to our Phase 2 RENEW clinical trial of LTI-03 which paused enrollment and patient dosing at our clinical trial sites in the United States. We believe that our existing data from the 26-week rat study supports the safety profile of LTI-03 and the conduct of the RENEW trial, and we intend to work with the FDA to address the clinical hold as expeditiously as possible. In August 2025, the UK Medicines and Healthcare products Regulatory Agency authorized us to initiate the RENEW trial. The RENEW trial is expected to enroll up to 120 patients worldwide, evaluating two dose groups of LTI-03 against a placebo. The primary objective of the trial is to assess safety and tolerability over 24 weeks of treatment. Secondary endpoints will include measures of lung function and imaging-based assessments of fibrosis progression. We are actively working with clinical sites in the UK to begin patient recruitment, with initial data expected in 2026. Standby Equity Purchase Agreement with the Selling Stockholder On July 29, 2025, we entered into the Standby Equity Purchase Agreement (the SEPA ) with the Selling Stockholder, pursuant to which the Selling Stockholder has committed to purchase from us up to an aggregate of $15,000,000 of Advance Shares, subject to certain limitations and conditions, from time to time over the term of the SEPA. This prospectus covers the sale or other disposition by the Selling Stockholder of up to 10,000,000 shares of common stock, consisting of (i) 213,099 Commitment Shares and (ii) up to 9,786,901 shares of common stock as Advance Shares that we may elect, in our sole discretion, to issue and sell to the Selling Stockholder from time to time from under the SEPA. Table of Contents The information in this preliminary prospectus is not complete and may be changed. The Selling Stockholder may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted. SUBJECT TO COMPLETION PRELIMINARY PROSPECTUS DATED SEPTEMBER 3, 2025 REIN THERAPEUTICS, INC. Up to 10,000,000 Shares of Common Stock This prospectus relates to the offer and sale from time to time of up to 10,000,000 shares of our common stock, par value $0.001 per share ( common stock ), by YA II PN, Ltd., a Cayman Islands exempt limited partnership and an affiliate of Yorkville Advisors Global, LP ( Yorkville or the Selling Stockholder ). The shares included in this prospectus consist of shares of common stock that we may, in our discretion, elect to issue and sell to the Selling Stockholder from time to time after the date of this prospectus, as set forth in the Standby Equity Purchase Agreement we entered into with the Selling Stockholder on July 29, 2025 (the SEPA ). Pursuant to the SEPA, the Selling Stockholder has committed to purchase from us, at our direction, up to $15,000,000 of shares of our common stock (the Advance Shares ) over a period of up to 36 months following the date of the SEPA, subject to the terms and conditions specified in the SEPA. The shares registered pursuant to this prospectus also include 213,099 shares of common stock (the Commitment Shares ) that we issued to the Selling Stockholder upon the execution of the SEPA as consideration for its irrevocable commitment to purchase shares of our common stock under the SEPA, at our election in our sole discretion, from time to time after the date of this prospectus, upon the terms and subject to the satisfaction of the conditions set forth in the SEPA. See the section titled The Yorkville Transaction for a description of the SEPA and the section titled Selling Stockholder for additional information regarding the Selling Stockholder. The additional 9,786,901 shares of common stock representing Advance Shares, that may be offered pursuant to this prospectus would be purchased by the Selling Stockholder from time to time pursuant to the SEPA at a price equal to 96% of the lowest of the three daily volume weighted average prices, or VWAPs, during a pricing period as set forth in the SEPA and would be subject to certain limitations. We are not selling any shares of common stock being offered by this prospectus and will not receive any of the proceeds from the sale of such shares by the Selling Stockholder. However, we may receive up to $15,000,000 in aggregate gross proceeds from sales of our common stock to the Selling Stockholder that we may, in our discretion, elect to make, from time to time after the date of this prospectus, pursuant to the SEPA. The Selling Stockholder may sell or otherwise dispose of the common stock described in this prospectus in different ways and at varying prices. See Plan of Distribution for more information about how the Selling Stockholder may sell or otherwise dispose of the common stock being registered pursuant to this prospectus. The Selling Stockholder is an underwriter within the meaning of Section 2(a)(11) of the Securities Act of 1933, as amended (the Securities Act ). The Selling Stockholder will pay all brokerage fees and commissions and similar expenses in connection with the offer and sale of the shares by the Selling Stockholder pursuant to this prospectus. We will pay the expenses of registering under the Securities Act the offer and sale of the common stock to which this prospectus relates by the Selling Stockholder, including legal and accounting fees. See Plan of Distribution . Our common stock is listed on the Nasdaq Capital Market under the symbol RNTX. On September 2, 2025, the closing price of our common stock was $1.35. Investing in our securities involves a high degree of risk. These risks are described in the Risk Factors section on page 6 of this prospectus. You should also consider the risk factors described or referred to in any documents incorporated by reference in this prospectus, and in any applicable prospectus supplement to this prospectus, before investing in these securities. Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued under this prospectus or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2025. Table of Contents ABOUT THIS PROSPECTUS This prospectus, including information incorporated by reference herein, is part of a registration statement that we filed with the U.S. Securities and Exchange Commission ( SEC ) under the Securities Act. Under this prospectus, the Selling Stockholder may, from time to time, sell shares of our common stock described in this prospectus in one or more transactions, as described herein. This prospectus provides you with a general description of the securities offered by the Selling Stockholder. Any prospectus supplement may also add, update or change information contained in this prospectus. Any statement that we make in this prospectus will be modified or superseded by any inconsistent statement made by us in a prospectus supplement. For investors outside of the United States: Neither we nor the Selling Stockholder have done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside of the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of our securities and the distribution of this prospectus outside of the United States. The registration statement we filed with the SEC includes exhibits that provide more detail of the matters discussed in this prospectus. This prospectus, including information incorporated by reference herein, contains summaries of certain provisions contained in some of the documents described herein, but reference is made to the actual documents for complete information. All of the summaries are qualified in their entirety by the actual documents. Copies of some of the documents referred to herein have been filed, will be filed or will be incorporated by reference as exhibits to the registration statement of which this prospectus is a part. You should read this prospectus, including the incorporated by reference herein, and the related exhibits filed with the SEC and any prospectus supplement, together with additional information incorporated by reference herein and described under the headings Where You Can Find More Information and Incorporation by Reference before making your investment decision. You should rely only on this prospectus, the information incorporated by reference herein, any prospectus supplement and the registration statement. Neither we nor the Selling Stockholder has authorized anyone else to provide you with different or additional information other than this prospectus or information incorporated by reference in this prospectus. If anyone provides you with different or inconsistent information, you should not rely on it. Offers to sell, and solicitations of offers to buy, our common stock are being made only in jurisdictions where offers and sales are permitted. You should assume that the information in this prospectus and any prospectus supplement, or incorporated by reference, is accurate only as of the respective dates of those documents. Our business, financial condition, results of operations and prospects may have changed since those dates. Table of Contents We do not have the right to commence any sales of Advance Shares to the Selling Stockholder under the SEPA until all of the conditions set forth in the SEPA have been satisfied, including that the registration statement of which this prospectus is a part is declared effective by the SEC and a final prospectus relating thereto is filed with the SEC (such date, the Condition Satisfaction Date ). Each advance (each, an Advance ) we request in writing to Yorkville under the SEPA (notice of such request, an Advance Notice ) may be for a number of Advance Shares up to such number of shares as is equal to 100% of the average daily trading volume of the common stock during the five trading days immediately preceding the Advance Notice. We may establish a minimum acceptable price in each Advance Notice below which we will not be obligated to make any sales to Yorkville pursuant to such notice. The Advance Shares sold pursuant to an Advance delivered by us will be purchased by Yorkville at a price equal to 96% of the lowest daily volume weighted average price (the VWAP ) of our common stock on the Nasdaq Capital Market during the three consecutive trading days commencing on the date of the delivery of the Advance Notice, other than the daily VWAP on a day in which the daily VWAP is less than a minimum acceptable price as stated by us in the Advance Notice or there is no VWAP on the subject trading day. We will control the timing and amount of any sales of Advance Shares to Yorkville pursuant to the SEPA. Yorkville has no right to require us to sell any shares of our common stock to Yorkville under the SEPA, but Yorkville is obligated to make purchases of Advance Shares as we direct, upon the terms and subject to the satisfaction of the conditions set forth in the SEPA. Actual sales of Advance Shares by us to Yorkville under the SEPA will depend on a variety of factors to be determined by us from time to time, including, among others, market conditions, the trading price of the common stock and determinations by us as to the appropriate sources of funding for the Company and its operations. Issuances of our Advance Shares to the Selling Stockholder under the SEPA will not affect the rights or privileges of our existing stockholders, except that the economic and voting interests of each of our existing stockholders will be diluted as a result of any such issuance. Although the number of shares of our common stock that our existing stockholders own will not decrease, the shares of our common stock owned by our existing stockholders will represent a smaller percentage of the total outstanding shares of our common stock after any such issuance of Advance Shares to the Selling Stockholder under the SEPA. For additional information see The Yorkville Transaction . Pre-Paid Advance Agreement with the Selling Stockholder On July 29, 2025, we entered into the Pre-Paid Advance Agreement (the PPA ) with Yorkville. The PPA provides that, upon the terms and subject to the conditions set forth therein, we may request, subject to Yorkville s approval, pre-paid advances of up to an aggregate of $6,000,000 from Yorkville (each, a Pre-Paid Advance ), which will be purchased by Yorkville at 95% of the face amount of the Pre-Paid Advance. At any time that there is an outstanding balance under the Pre-Paid Advances, Yorkville may provide written notice (each, a Purchase Notice ) requiring that we issue shares of our common stock ( PPA Shares ) to Yorkville, which shall be offset against and reduce the amounts outstanding under the Pre-Paid Advances, at a price per share equal to the lower of (i) 115% of the VWAP of our common stock on the last full trading day immediately preceding the closing of such Pre-Paid Advance and (ii) 95% of the lowest daily VWAP of our common stock during the seven consecutive trading days immediately preceding the date on which Yorkville provides the Purchase Notice to us, subject to a floor price of $0.28 per share. Yorkville shall, in each Purchase Notice, select the number of PPA Shares to be issued, in its sole discretion, provided that the aggregate price for such shares may not exceed the balance outstanding under the Pre-Paid Advances or exceed other specified limits in the PPA. Concurrent with the entry into the PPA, we requested a Pre-Paid Advance of $1,000,000 from Yorkville under the PPA and received $950,000 of cash proceeds after application of the discount to Yorkville, all of which Table of Contents remains outstanding as of the date of this prospectus. Amounts offset by the issuance of PPA Shares shall be applied first toward accrued and unpaid interest, if any, and then toward outstanding principal under the Pre-Paid Advances. In August 2025, we issued 288,209 shares of our common stock, at an average price per share of $1.06, to Yorkville pursuant to Purchase Notices which were offset against $300,000 of outstanding Pre-Paid Advances. Corporate Information We were incorporated under the laws of the State of Delaware on August 6, 2001 under the name Renegade Therapeutics, Inc. We changed our name to Aileron Therapeutics, Inc. in February 2007. On October 31, 2023, we acquired Lung Therapeutics, Inc., or Lung, pursuant to an Agreement and Plan of Merger, after which time Lung became our wholly-owned subsidiary. On January 10, 2025, we changed our name to Rein Therapeutics, Inc., and changed our trading symbol from ALRN to RNTX , effective January 13, 2025. Our principal executive office is located at 12407 N. Mopac Expy., Suite 250 #390, Austin, Texas 78758, and our telephone number is (737) 802-1989. Our website address is http://www.reintx.com. The information contained on, or that can be accessed through, our website is not a part of this prospectus. We have included our website address in this prospectus solely as an inactive textual reference. Rein and other trademarks or service marks of Rein appearing in this prospectus are the property of Rein. The other trademarks, trade names and service marks appearing in this prospectus are the property of their respective owners. Solely for convenience, the trademarks and trade names in this prospectus are referred to without the and symbols, but such references should not be construed as any indicator that their respective owners will not assert, to the fullest extent under applicable law, their rights thereto. Table of Contents
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/RVYL_ryvyl-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/RVYL_ryvyl-inc_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/RVYL_ryvyl-inc_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/SDSTW_stardust_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/SDSTW_stardust_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..7ca81ab29a3e5a6efc2ac0893a7d33463e39293c
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/SDSTW_stardust_prospectus_summary.txt
@@ -0,0 +1,438 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information that you
+should consider before investing in our Common Stock. You should read this entire prospectus carefully, including the matters discussed
+under the sections titled Risk Factors, Management s Discussion and Analysis of Financial Condition and Results
+of Operations, Business and the consolidated financial statements and related notes included elsewhere in this prospectus
+before making an investment decision.
+
+ 
+
+Company
+Overview
+
+ 
+
+Stardust
+Power is a development stage American manufacturer of battery-grade lithium products designed to supply for energy storage across e-mobility,
+grid infrastructure, and data centers industry and help to secure America s leadership in the energy transition. Stardust Power
+is a newly incorporated company, formed on March 16, 2023, which intends to construct a lithium refinery facility in the state of Oklahoma,
+in the United States (the Facility ), with a projected capacity of producing up to 50,000 tons per annum ( tpa )
+of battery grade lithium. Stardust Power is focused on the midstream refinery process, and currently, is not undertaking any exploration
+activities. Stardust Power has engaged advisors who have conducted various environmental and geotechnical/technical studies that are
+a prerequisite to establishing the Facility. Stardust Power seeks to establish a refinery serving as a hub to process multiple sources
+of lithium brine primarily from the U.S. to supply battery grade lithium carbonate to domestic battery manufacturers. Stardust Power
+intends to enter into letters of intent and memoranda of understanding to avail itself of brine feedstock supply. Stardust Power s
+business strategy will depend on such agreements and its ability to source lithium brine.
+
+ 
+
+Stardust
+Power has also engaged with established advisors with varied expertise in lithium refining, for the development of the refinery to oversee
+the construction of the Facility. As a newly incorporated entity, Stardust Power is dependent on the expertise of, and agreements with,
+its various consultants to execute its business strategy. Having been incorporated on March 16, 2023, Stardust Power has a limited history
+of operations. The Company has not generated any revenue and has a history of losses, that stood at approximately $27.5 million, for
+the period since its inception on March 16, 2023, to December 31, 2024. For more information, see the sections titled Business 
+and Management s Discussion and Analysis of Financial Condition and Results of Operations. 
+
+ 
+
+Corporate
+Information
+
+ 
+
+We
+were originally known as Global Partner Acquisition Corp II. In connection with the consummation of the business combination on July
+8, 2024, we changed our name from Global Partner Acquisition Corp II to Stardust Power Inc.
+
+ 
+
+Our
+principal executive office is located at 15 E. Putnam Ave, Suite 378, Greenwich, CT 06830. Our corporate website address is www.stardust-power.com.
+Our website and the information contained on, or that can be accessed through, the website is not deemed to be incorporated by reference
+in, and is not considered part of, this prospectus. The website address is included as an inactive textual reference only. Stardust
+Power and our other registered and common law trade names, trademarks and service marks are property of Stardust Power Inc. This
+prospectus contains additional trade names, trademarks and service marks of others, which are the property of their respective owners.
+Solely for convenience, trademarks and trade names referred to in this prospectus may appear without the or TM symbols.
+
+ 
+
+Emerging
+Growth Company Status
+
+ 
+
+We
+are an emerging growth company, as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business
+Startups Act of 2012, as amended (the JOBS Act ), and they may take advantage of certain exemptions from various reporting
+requirements that are applicable to other public companies that are not emerging growth companies, including, but not limited to, not
+being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended ( Sarbanes-Oxley
+Act ), reduced disclosure obligations regarding executive compensation in their periodic reports and proxy statements, and exemptions
+from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute
+payments not previously approved.
+
+ 
+
+ 11
+
+ 
+
+ 
+
+ 
+
+Further,
+Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting
+standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do
+not have a class of securities registered under the Exchange Act) are required to comply with the new or revised financial accounting
+standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements
+that apply to non-emerging growth companies but any such election to opt out is irrevocable. We have elected not to opt out of such extended
+transition period, which means that when a standard is issued or revised and it has different application dates for public or private
+companies we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised
+standard. This may limit comparability of our financial statements with certain other public companies because of the potential differences
+in accounting standards used.
+
+ 
+
+We
+will remain an emerging growth company until the earlier of: (i) the last day of the fiscal year (a) ending after the fifth anniversary
+of the closing of the initial public offering (i.e., December 31, 2027), (b) in which we have total annual gross revenue of at least
+$1.235 billion or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common equity that
+is held by non-affiliates equals or exceeds $700 million as of the prior June 30th; and (ii) the date on which we have issued more than
+$1.0 billion in non-convertible debt securities during the prior three-year period.
+
+ 
+
+Summary
+of Risk Factors
+
+ 
+
+You
+should consider all of the information contained in this prospectus before investing in our securities which involves substantial risk.
+Our business is subject to numerous risks and uncertainties, including those highlighted in the section entitled Risk Factors 
+beginning on page 15 of this prospectus, that represent challenges that we face in connection with the successful implementation of our
+strategy and the growth of our business. The occurrence of one or more of the events or circumstances described in the section entitled
+ Risk Factors, alone or in combination with other events or circumstances, may have a material adverse effect on
+our business, cash flows, financial condition and results of operations. Important factors and risks that could cause actual results
+to differ materially from those in the forward-looking statements include, among others, the following:
+
+ 
+
+ 
+ 
+ Resales
+ of our Common Stock in the public market by our stockholders as a result of this offering may cause the market price of our Common
+ Stock to fall.
+
+ 
+ 
+ 
+
+ 
+ 
+ Investors
+ who buy shares at different times will likely pay different prices.
+
+ 
+ 
+ 
+
+ 
+ 
+ This
+ offering may cause the trading price of our Common Stock to decrease.
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ future performance is difficult to evaluate because we have a limited operating history in the lithium industry.
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ limited history makes it difficult to evaluate our business and prospects and may increase the risks associated with your investment.
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ management has identified conditions that raise substantial doubt about our ability to continue as a going concern.
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ are a development stage company, and there is no guarantee that our development will result in the commercial production of lithium
+ from brine sources.
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ face numerous risks related to exploration, construction, and extraction of brine by our suppliers.
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ quarterly and annual operating and financial results and our revenue are likely to fluctuate significantly in future periods.
+
+ 
+ 
+
+ 12
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Our
+ long-term success will depend ultimately on our ability to generate revenues, achieve and maintain profitability, and develop positive
+ cash flows from our battery-grade lithium production activities.
+
+ 
+ 
+ 
+
+ 
+ 
+ Pipeline
+ of lithium feedstock may prove to be non-viable, which could have material adverse impact on our business and operations.
+
+ 
+ 
+ 
+
+ 
+ 
+ Logistics
+ costs based on a hub and spoke refinery model may increase the price to where it is not economically viable.
+
+ 
+ 
+ 
+
+ 
+ 
+ Even
+ if we are successful in completing all initial phases and the first commercial production at our Facility and consistently produce
+ battery-grade lithium on a commercial scale, we may not be successful in commencing and expanding commercial operations to support
+ the growth of our business.
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ ability to manage growth will have an impact on our business, financial condition and results of operations.
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ products may not qualify for use for our intended customers.
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ might not be able to sell our products as intended.
+
+ 
+ 
+ 
+
+ 
+ 
+ Delays
+ and other obstacles may prevent the successful completion of our Facility.
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ depend on our ability to successfully access the capital and financial markets. Any inability to access the capital or financial
+ markets may limit our ability to meet our liquidity needs and long-term commitments, fund our ongoing operations, execute our business
+ plan or pursue investments that we may rely on for future growth.
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ may not be able to develop, maintain and grow strategic relationships, identify new strategic relationship opportunities or form
+ strategic relationships, in the future.
+
+ 
+ 
+ 
+
+ 
+ 
+ Lithium
+ can be highly combustible, and if we have incidents, it could adversely impact us.
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ lithium brine industry includes well capitalized companies, and we may not have sufficient resources to compete against them.
+
+ 
+ 
+ 
+
+ 
+ 
+ Low-cost
+ producers could disrupt the market and be able to provide products cheaper than the Company.
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ may be unable to qualify for existing federal and state level grants and incentives and the grants and incentives may not be released
+ to us as quickly or efficiently as we anticipate or at all.
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ development of non-lithium battery technologies could adversely affect us.
+
+ 
+ 
+ 
+
+ 
+ 
+ Lithium
+ prices are subject to unpredictable fluctuations.
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ development of our lithium refinery is highly dependent upon the currently projected demand for and uses of lithium-based end products.
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ future growth and success are dependent upon consumers demand for electric vehicles in an automotive industry that is generally
+ competitive, cyclical and volatile.
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ may be unable to successfully negotiate final, binding terms related to our current non-binding memoranda of understanding and letters
+ of intent for supply and offtake agreements, which could harm our commercial prospects.
+
+ 
+ 
+ 
+
+ 
+ 
+ An
+ escalation of the current war in Ukraine, generalized conflict in Europe and the Middle East, or the emergence of conflict elsewhere,
+ may adversely affect our business.
+
+ 
+ 
+ 
+
+ 
+ 
+ Potential
+ tariffs or a global trade war could increase the cost of products we rely upon, which could adversely impact the competitiveness
+ of our business and our financial results.
+
+ 
+ 
+ 
+
+ 
+ 
+ Climate
+ change, legislation, regulation and policies may result in increased operating costs and otherwise affect our business, our industry
+ and the global economy.
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ identified material weaknesses in our internal control over financial reporting in prior year. If we experience additional material
+ weaknesses or other deficiencies in the future or otherwise fail to maintain an effective system of internal control over financial
+ reporting, we may not be able to accurately or timely report our financial results, which could result in loss of investor confidence
+ and adversely impact our stock price.
+
+ 
+ 
+
+ 13
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/SGBX_safe_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/SGBX_safe_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/SGBX_safe_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/SHFSW_shf_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/SHFSW_shf_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..03a7a53e1db910425a43489088eb2d384c67a1e4
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/SHFSW_shf_prospectus_summary.txt
@@ -0,0 +1,763 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+The
+following summary highlights information contained elsewhere in this prospectus or incorporated by reference herein and does not contain
+all the information that may be important to purchasers of our securities. Prospective purchasers of our securities should carefully
+read the entire prospectus, the applicable prospectus supplement and any related free writing prospectus, including the risks of investing
+in our securities discussed under the heading Risk Factors contained in this prospectus, the applicable prospectus supplement
+and any related free writing prospectus, and under similar headings in the other documents that are incorporated by reference into this
+prospectus. Prospective purchasers of our securities should also carefully read our financial statements, the information incorporated
+by reference into this prospectus and the exhibits to the registration statement of which this prospectus is a part.
+
+ 
+
+The
+Company
+
+ 
+
+The
+Company was founded in 2015 as a solution to a major problem that plagued the nascent legalized cannabis industry in Colorado - access
+to reliable and compliant financial services. Cannabis-related funds were already finding their way into the financial system, including
+via hidden, misrepresented accounts and unlawful banking practices. Based upon our research, we determined that the appropriate step
+was to protect the financial system from criminal activity and provide legitimacy to the legal state CRBs.
+From decades of regulatory and banking experience, we created a detailed compliance program to assist financial institutions desiring
+to provide safe and sound financial services that would accomplish industry accountability and protect the financial system. The compliance
+program provides onboarding, validation and monitoring services to financial institutions desiring to provide traditional banking services
+to all types of marijuana, hemp, and CBD businesses, and to ancillary businesses that provide services to the cannabis industry. These
+ancillary businesses include payroll companies, payment processors, and professionals providing services to and receiving payment from
+CRBs. As the lawful cannabis industry grew beyond Colorado, the Company evolved its business practices to build a national footprint
+and currently provides services to financial institutions that provide banking services in 41 states and territories of the United States
+of America (the United States or U.S. ) where cannabis is either legal medicinally or for full adult use.
+
+ 
+
+We
+intend to support our mission by providing unparalleled client and customer service while offering a unique array of innovative technology-based
+products and services. We believe that our unique banking relationships, reputation of reliability in the cannabis industry, as well
+as our deep expertise and experience in the industry will position us to serve a broad range of cannabis industry participants, including
+cannabis and hemp cultivators, processors, manufacturers, dispensaries, multi-state operators, as well as the financial institutions
+that wish to bank cannabis and hemp industry participants. Since 2015, we have facilitated more than $25.6 billion in deposit activity
+across a footprint of 41 states and territories of the United States. Through its relationship with its financial institution customers,
+the Company has successfully navigated over 16 state and federal banking exams.
+
+ 
+
+Through
+a combination of organic growth, increased commercial lending, and further development of our financial technology company ( fintech )
+platform, we believe we are all well-positioned to service the cannabis industry, including through the industry s recent large-scale
+consolidations.
+
+ 
+
+Background
+and Recent Developments
+
+ 
+
+Background
+
+ 
+
+The
+Company has developed and commercialized a fully compliant financial services platform for financial institutions providing banking services
+to CRBs to access and maintain reliable financial services as long as both the financial institution customer and the CRB meet regulatory
+requirements. Our platform enables the Company s staff to efficiently guide financial institution customers and the CRBs desiring
+banking services through the onboarding, validation and monitoring process. Our automated platform provides for an efficient and effective
+management tool allowing our employees to provide continuity of service while enabling compliance staff to monitor Bank Secrecy Act ( BSA )
+activities.
+
+ 
+
+ 
+
+ 6
+
+ 
+
+ 
+
+ 
+
+ 
+
+Through
+the Company s platform, our financial institution customers have the ability to provide CRBs with access to traditional financial
+services including wires, debit, Automated Clearing House ( ACH ), remote deposit capture, business checking and savings
+accounts, courier and vaulting services, cash management accounts and commercial lending. We believe our services have been implemented
+consistent with applicable law and regulations, ensuring our financial institution customers will be able to provide CRBs with reliable
+access to these services. We feel our history of developing processes that satisfy regulatory standards has resulted in a solid reputation
+with related authorities and solidifies our ability to continue to grow existing services and reduces barriers to expanding into new
+service offerings.
+
+ 
+
+Recent
+Developments
+
+ 
+
+On
+August 27, 2025, the Company closed an offering of Convertible Promissory Notes (the Notes ) that were issued to certain
+accredited investors (the Investors ) with a maturity date of September 9, 2026, a 20% original issue discount and an aggregate
+principal sum of $562,500. Pursuant to the terms of the Notes, the Company has agreed to pay all outstanding principal and interest on
+the maturity date. The conversion price of the Notes is the lesser of (i) a twenty percent (20%) discount to the average VWAP (as defined
+below) of the Common Stock for the twenty (20) consecutive trading days ending on the trading day immediately prior to the execution
+date of the Note and (ii) a twenty percent (20%) discount to the average VWAP of the Common Stock for the twenty (20) consecutive trading
+days ending on the trading day immediately preceding the date of a conversion notice, subject to adjustment as provided in the Note.
+The Investors may, at any time, convert all or a portion of the Notes. The Notes contain customary events of default and become due and
+payable upon the occurrence thereof. The Notes also provide the Investors with the right to exchange the Note for securities issued by
+the Company in a subsequent offering of securities by the Company. At the election of the Investors, 120% of the principal and interest
+then outstanding on the Note shall be exchanged for the new securities. The Company has also granted the Investors piggyback registration
+rights with respect to the shares of Common Stock underlying the Notes.
+
+ 
+
+On
+September 9, 2025, the Company issued an additional Note to an accredited investor in the principal sum of $125,000 (the September
+Note ). The September Note is identical to the Notes issued on August 27, 2025.
+
+ 
+
+On
+September 17, 2025, the Company entered into the Purchase Agreement with CREO Investments, LLC ( CREO ), whereby the
+Company may offer and sell, from time to time at its sole discretion, and whereby CREO has committed to purchase, up to $150.0 million
+of the Company s newly issued Common Stock, subject to the limitations described herein. We and CREO can also agree to increase
+this purchase commitment to up to $500.0 million of the Company s newly issued Common Stock, subject to the limitations described
+herein. As consideration for CREO s commitment to purchase shares of Common Stock pursuant to the Purchase Agreement, we agreed
+to issue to CREO $1,000,000 in stated value of certain preferred stock of the Company (the Commitment Shares ),
+following the creation of such preferred stock. In the event CREO s purchase commitment is increased, we will issue additional
+CREO Commitment Shares. Concurrently with entering into the Purchase Agreement, the Company also entered into a registration rights agreement
+with CREO, pursuant to which it agreed to provide CREO with certain registration rights related to the shares issued under the Purchase
+Agreement (the CREO Registration Rights Agreement ).
+
+ 
+
+On
+September 30, 2025, the Company and CREO entered into an amendment to the Purchase Agreement whereby the Company agreed to apply 25%
+of any net cash proceeds from the sale of shares of its Common Stock pursuant to the Purchase Agreement towards the redemption of the
+Series B Preferred Stock. The issuance of such shares is solely at our discretion and is subject to conditions contained in the Purchase
+Agreement, the satisfaction of which are entirely outside of CREO s control.
+
+ 
+
+On
+September 30, 2025, the Company entered into a Securities Purchase Agreement (the Series B SPA ) with the investors
+party thereto (the Buyers ), pursuant to which, subject to the terms and conditions set forth therein, the Company agreed
+to issue and sell to the Buyers an aggregate of 31,052 shares of the Company s Series B Convertible Preferred Stock, $0.0001 par
+value per share (the Series B Preferred Stock ) and related warrants (the Original Series B Warrants )
+initially to acquire an aggregate of 1,999,544 shares of the Company s Common Stock, subject to adjustment for stock splits, stock
+dividends, recapitalizations, reorganizations, reclassifications, combinations, subdivisions or other similar events. The exercise price
+per warrant share is $7.7644, subject to adjustment as provided therein.
+
+ 
+
+On
+October 14, 2025, the Company entered into an Amendment No. 1 to Securities Purchase Agreement (the Amendment ), with
+each Buyer, effective September 30, 2025. Pursuant to each Amendment, such Buyer s Original Series B Warrant was amended and restated (as
+amended and restated, each, a Series B Warrant ) to correct the exercisability date from six months and one day after the
+Issuance Date (as defined in the Series B Warrant) to six months and one day after the Applicable Date (as defined in the Series B
+Warrant).
+
+ 
+
+Subject
+to the terms of the Warrant, each Warrant is exercisable at any time on or after the six month and one day anniversary of the Applicable
+Date (as defined in the Series B SPA). The Warrants expire upon the third anniversary of such Initial Exercisability Date. Subject
+to the terms and conditions of the Certificate of Designation (as defined below), the Series B Preferred Stock is convertible immediately
+upon issuance, and the conversion price is $7.7644 per share, subject to adjustment as provided therein. The aggregate purchase price
+paid by the Buyers to the Company pursuant to the Series B SPA was approximately $28.8 million, resulting in approximately $6.3
+million in additional cash to the Company. This purchase price includes certain Buyers that paid for the securities acquired pursuant
+to the Series B SPA, in whole or in part, by (i) cancelling outstanding Indebtedness (as defined in the Series B SPA) or
+securities of the Company, (ii) cancelling amounts owed to such Buyer by the Company, including the Commitment Shares owed to CREO,
+and/or (iii) transferring assets, including third-party securities, to the Company. Certain members of the Company s management
+and board participated in the transaction as Buyers, however the issuance to such members of management of the shares of Common Stock
+underlying the Series B Preferred Stock and Warrants is subject to stockholder approval under Nasdaq Listing Rule 5635(c). The Company
+received net proceeds of approximately $6.1 million in connection with the transactions contemplated by the Series B SPA.
+
+ 
+
+In
+connection with the execution of the Series B SPA, the Company entered into a Registration Rights Agreement with the Buyers
+on the Closing Date (the Registration Rights Agreement ). Pursuant to the Registration Rights Agreement, the
+Company agreed, among other things, to file a registration statement on Form S-1 with the SEC as soon as practicable, but in no event
+later than October 29, 2025, to register the Common Stock underlying the Series B Preferred Stock and the Series B Warrants for resale
+by the Buyers.
+
+ 
+
+On
+September 30, 2025, the Company entered into a Debt Cancellation Agreement (the Debt Cancellation Agreement ) with Partner
+Colorado Credit Union ( PCCU ). As previously disclosed, the Company and PCCU entered into a Senior Secured Promissory Note
+and Security Agreement (the Loan Agreements ) on March 29, 2023 whereby PCCU agreed to make loans to the Company in the
+aggregate principal amount of $14.5 million. Pursuant to the terms of the Debt Cancellation Agreement, the outstanding principal amount
+of all loans made to the Company under the Loan Agreements, or approximately $10.7 million, was deemed repaid and the obligations of
+the Company represented thereby with respect to such principal amount was deemed to be satisfied in full and cancelled in exchange for
+13,436 shares of Company s Series B Preferred Stock and a Series B Warrant to purchase 865,200 shares of Stock, subject to adjustment
+as provided in the Series B Warrant.
+
+ 
+
+Exchange
+and Cancellation Agreements
+
+ 
+
+On
+September 30, 2025, the Company entered into Exchange and Cancellation Agreements (each, an Exchange and Cancellation Agreement )
+with each of Verdun Investments LLC ( Verdun ), Vellar Opportunity Fund SPV LLC Series 1 ( Vellar ),
+and Midtown East Management NL,LLC ( Midtown and, together with Verdun and Vellar, the Sellers ). As previously
+disclosed, on June 16, 2022 the Company and Midtown entered into a Forward Purchase Agreement (the FPA ), which was subsequently
+assigned by Midtown to each of Vellar and Verdun. Pursuant to the terms of the Exchange and Cancellation Agreement, the Company issued
+a certain number of shares of Series B Preferred Stock and Warrants to the Sellers in exchange for each Seller agreeing to irrevocably
+cancel, waive and forego all of its rights under the FPA and to terminate the FPA. The Company issued (i) 1,607 shares of Series B Preferred
+Stock and a Warrant to purchase 103,485 shares of Common Stock to Verdun, (ii) 2,070 shares of Series B Preferred Stock and a Warrant
+to purchase 133,301 shares of Common Stock to Midtown, and (iii) 1,325 shares of Series B Preferred Stock and a Warrant to purchase 85,325
+shares of Common Stock to Vellar. The number of shares of Common Stock purchasable under the Warrants is subject to adjustment as provided
+therein.
+
+ 
+
+As
+previously disclosed, on August 27, 2025 and September 9, 2025 the Company issued Convertible Promissory Notes (the Notes )
+to certain accredited investors with an aggregate principal sum of $687,500. On September 30, 2025, these Notes were exchanged for an
+aggregate of 825 shares of Series B Preferred Stock and Series B Warrants to purchase an aggregate of 53,127 shares of Common Stock,
+subject to adjustment as provided in the Series B Warrant.
+
+ 
+
+ 
+
+ 7
+
+ 
+
+ 
+ 
+
+ 
+
+Exchange
+Listing
+
+ 
+
+Our
+Common Stock is currently listed on the on the Nasdaq under the symbol SHFS. 
+
+ 
+
+Nasdaq
+Listing Compliance
+
+ 
+
+As
+of June 30, 2025, our stockholders deficit of approximately $17.9 million was $20.4 million below the $2.5 million minimum equity
+requirement for continued listing on Nasdaq under Rule 5550(b)(1). We received a deficiency notice from Nasdaq regarding this noncompliance,
+and we submitted a compliance plan on May 22, 2025.
+
+ 
+
+On
+April 7, 2025, the Company received a notice from Nasdaq indicating that it no longer met the
+continued listing requirements. The Company does not meet the alternative criteria for continued listing, which are based on
+the market value of listed securities or net income from continuing operations Specifically, the Company s stockholders 
+equity was below the minimum required stockholders equity of $2.5 million as stipulated by Nasdaq s Listing Rule
+5550(b)(1) ( Rule 5550(b)(1) ). A compliance plan was submitted to Nasdaq on May 22, 2025, and Nasdaq confirmed receipt
+of our compliance plan. As a result of the recent preferred equity financing, Nasdaq informed the Company that it has regained
+compliance with Rule 5550(b)(1). In that regard, the Company believes that its stockholders equity exceeds $2.5 million, and
+SHF anticipates that the information contained in its Quarterly Report on Form 10-Q for the period ended September 30, 2025, will
+reflect this. The Company also believes that its stockholders equity will continue to exceed $2.5 million as of December 31,
+2025.
+
+ 
+
+There
+can be no assurance that the Company will be able maintain compliance with any other Nasdaq requirement in the future.
+
+ 
+
+Emerging
+Growth Company
+
+ 
+
+We
+are an emerging growth company ( EGC ) as defined in the Jumpstart Our Business Startups Act of 2012 (the JOBS
+Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable
+to other public companies that are not emerging growth companies, including, but not limited to, not being required to
+comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 ( SOX ), reduced disclosure
+obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding
+a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.
+
+ 
+
+In
+addition, Section 107 of the JOBS Act also provides that an EGC can take advantage of the extended transition period provided in Section
+7(a)(2)(B) of the Securities Act, for complying with new or revised accounting standards. In other words, an EGC can delay the adoption
+of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the
+benefits of this extended transition period, for as long as it is available. We will remain an EGC until the earlier of (1) the last
+day of the fiscal year (a) following the fifth anniversary of the date of the first sale of our common equity securities pursuant to
+an effective registration statement under the Securities Act and (b) in which we have total annual gross revenue of at least $1.07 billion,
+(2) the date on which we are deemed to be a large accelerated filer, which means the market value of our Common Stock that is held by
+non-affiliates exceeds $700 million as of the last business day of our most recently completed second fiscal quarter, and (3) the date
+on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period. References herein to emerging
+growth company have the meaning provided in the JOBS Act.
+
+ 
+
+Smaller
+Reporting Company 
+
+ 
+
+We
+are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K, which allows us to take advantage of certain
+exemptions from disclosure requirements including exemption from compliance with the auditor attestation requirements of Section 404.
+We will remain a smaller reporting company until the last day of the fiscal year in which (i) the market value of the shares of our Common
+Stock held by non-affiliates exceeds $250.0 million as of the prior June 30, and (ii) our annual revenue exceeded $100.0 million during
+such completed fiscal year or the market value of the shares of our Common Stock held by non-affiliates exceeds $700.0 million as of
+the prior June 30. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial
+statements with other public companies difficult or impossible.
+
+ 
+
+Corporate
+Information.
+
+ 
+
+The
+Northern Lights Acquisition Corp. ( NLIT ) was incorporated in the State of Delaware on February 26, 2021 for the purpose
+of effecting a merger, share exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or
+more businesses. The Company completed its initial public offering in June 2021. In September 2022, NLIT acquired SHF, changing its name
+from Northern Lights Acquisition Corp. to SHF Holdings, Inc. Our principal executive offices are located at 1526 Cole Boulevard,
+Suite 250, Golden, Colorado 80401 and our telephone number is 303-431-3435. Our website address is www.shfinancial.org. The information
+contained on, or that can be accessed through, our website is not a part of this prospectus. We have included our website addresses in
+this prospectus solely as an inactive textual reference.
+
+ 
+
+The
+rights of holders of our Common Stock are governed by our Second Amended and Restated Certificate of Incorporation (as amended, the Second
+Amended and Restated Certificate of Incorporation ), our bylaws (the Bylaws ), and the Delaware General Corporation
+Law (the DGCL ). See Description of Capital Stock. 
+
+ 
+
+ 
+
+ 8
+
+ 
+
+ 
+ 
+
+ 
+
+ 
+ 
+
+ THE
+ OFFERING
+
+ 
+
+ 
+ Issuer
+ 
+ SHF
+ Holdings, Inc.
+
+ 
+
+ 
+ Shares
+ of Common Stock offered by the Selling Stockholders
+ 
+ Up
+ to 52,280,646 shares of our Common Stock.
+
+ 
+
+ We
+ are registering the number of shares of Common Stock issuable under the Purchase Agreement assuming the floor conversion price of
+ $1.5528 for the Series B Preferred conversion.
+
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Shares
+ of Common Stock outstanding immediately prior to this offering
+
+ 
+
+ 
+ 2,953,473
+ shares (as of October 16, 2025).
+
+ 
+ 
+ 
+ 
+
+ 
+ Shares
+ of Common Stock outstanding immediately following to this offering
+ 
+ Up to 55,234,119 shares, assuming immediate (i)
+ conversion of all the Preferred Stock, and (ii) exercise of all Warrants.
+
+ 
+ 
+ 
+ 
+
+ 
+ Terms
+ of the offering
+ 
+ Each
+ Selling Stockholder will determine when and how it will dispose of any shares of our Common
+ Stock that are registered under this prospectus for resale. See Plan of Distribution. 
+
+ 
+ 
+ 
+ 
+
+ 
+ Plan
+ of distribution
+ 
+ Each
+ Selling Stockholder will determine when and how it sells all or a portion of the shares of
+ Common Stock offered pursuant to this prospectus. See Plan of Distribution. 
+
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Use
+ of proceeds
+ 
+ We
+ are not selling any securities under this prospectus, and will not receive any proceeds from
+ the sale of Common Stock by the Selling Stockholders pursuant to this prospectus.
+ Upon any exercise of the Warrants by payment of cash, we will receive the exercise price
+ of such Warrants, which, if exercised in cash with respect to all of the Warrants outstanding
+ and held by the Selling Stockholders as of the date hereof, would result in gross proceeds
+ to us of approximately $15.5 million. However, we cannot predict when and in what amounts or
+ if the Warrants will be exercised by payments of cash and it is possible that the Warrants
+ may expire and never be exercised, in which case we would not receive any cash proceeds from
+ their exercise.
+
+ 
+
+ 
+
+ 
+
+ We
+ intend to use any net proceeds from the exercise of Warrants for working capital and
+ other general corporate purposes. See Use of Proceeds. 
+
+ 
+
+ 
+ Nasdaq
+ symbol
+ 
+ SHFS 
+
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Risk
+ factors
+ 
+ Investing
+ in our securities involves significant risks. Before making a decision whether to invest
+ in our securities, please read the information contained under the heading Risk
+ Factors in this prospectus, the documents we have incorporated by reference herein
+ and under similar headings in other documents filed after the date hereof and incorporated
+ by reference into this prospectus. See Incorporation of Certain Information by
+ Reference and Where You Can Find More Information. 
+
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Transfer
+ agent
+ 
+ The
+ transfer agent and registrar for our Common Stock is Continental Stock Transfer and Trust
+ Company.
+
+ 
+
+ 
+ 
+
+ 
+
+ 9
+
+ 
+
+ 
+
+ 
+
+PRIVATE
+PLACEMENT OF PREFERRED SHARES AND ABACA MERGER SHARES
+
+ 
+
+This
+prospectus relates to the potential offer and sale from time to time by the selling stockholders named in this prospectus (each, a
+ Selling Stockholder ) of 52,280,646 shares of Class A common stock, par value $0.0001 (the Common Stock ),
+of SHF Holdings, Inc. ( SHF, the Company, we, us, or
+ our ).
+
+ 
+
+The
+52,280,646 shares of Common Stock offered under this prospectus consist of (i) 49,993,585 shares of Common Stock issuable upon conversion of Series B Convertible Preferred Stock (the Series B
+Preferred Stock ) issued and sold to certain investors pursuant to a Securities Purchase Agreement, dated as of September 30,
+2025, by and between us and such investors (the Series B SPA ) at the potential floor conversion price of $1.5528, (ii) 1,999,544 shares of Common Stock underlying Common Stock purchase warrants (the Series B Warrants ) at
+the floor exercise price of $1.5528 per warrant share, issued and sold to the investors pursuant to the Series B SPA, (iii) 250,000
+shares of Common Stock underlying warrants at the exercise price of $40.00 per warrant share, issued and sold to the Abaca Holders
+(as defined below) (the Abaca Warrants and together with the Series B Warrants, the Warrants ), pursuant
+to an Agreement and Plan of Merger, dated as of October 31, 2022 (as amended, the Merger Agreement ), by and between
+us, SHF Merger Sub I, SHF Merger Sub II, LLC, Rockview Digital Solutions, Inc. d/b/a Abaca ( Abaca ), and Daniel Roda,
+solely in his capacity as the representative of Abaca s securityholders (the Abaca Holders ), and (iv) 37,517
+shares of Common Stock issued on or about October 5, 2025 to the Abaca Holders pursuant to the Merger Agreement.
+
+ 
+
+Private
+Placement of Preferred Shares
+
+ 
+
+On
+September 30, 2025, the Company entered into the Series B SPA with the investors party thereto (the Buyers ), pursuant to
+which, subject to the terms and conditions set forth therein, the Company agreed to issue and sell to the Buyers an aggregate of 31,052
+shares of Series B Preferred Stock and related Original Series B Warrants initially to acquire an aggregate of 1,999,544 shares of the
+Company s Common Stock, subject to adjustment for stock splits, stock dividends, recapitalizations, reorganizations, reclassifications,
+combinations, subdivisions or other similar events. The Series B Preferred Stock that was issued included Commitment
+Shares that the Company was required to issue to CREO in accordance with the Purchase Agreement.
+
+ 
+
+On
+October 14, 2025, the Company and each Buyer entered into an Amendment No. 1 to Securities Purchase Agreement (the
+ Amendment ). Pursuant to each Amendment, such Buyer s Original Series B Warrant was amended and restated (as
+amended and restated, each, a Series B Warrant ) to change the exercisability date from six months and one day after the
+Issuance Date (as defined in the Series B Warrant) to six months and one day after the Applicable Date (as defined in the Series B
+Warrant).
+
+ 
+
+Subject
+to the terms of the Series B Warrant, each Series B Warrant is exercisable at any time on or after the six month and one day anniversary
+of the Applicable Date (the Initial Exercisability Date ). The Series B Warrant expire upon the third anniversary of such
+Initial Exercisability Date. The exercise price per warrant share is $7.7644, subject to adjustment as provided therein.
+
+ 
+
+Subject to the terms and conditions of the Certificate of Designation (as defined below), the Series B Preferred
+Stock is convertible immediately upon issuance, and the conversion price is $7.7644 per share, subject to adjustment as provided therein.
+
+ 
+
+Series
+B Preferred Stock
+
+ 
+
+Our
+board of directors amended our articles of incorporation on September 30, 2025, to authorize the issuance of Series B Preferred Stock
+by the filing of a certificate of designation (as amended as of the date of this Information Statement, the Series B Certificate
+of Designation ), with each such share having a stated value of $1,000 as described below.
+
+ 
+
+General.
+Each share of Series B Preferred Stock has a stated value of $1,000 per share and, when issued, the Series B Preferred Stock will be
+fully paid and non-assessable.
+
+ 
+
+Ranking.
+Series B Preferred Stock, with respect to the payment of dividends, distributions and payments upon the liquidation, dissolution and
+winding up of the Company, ranks senior to all capital stock of the Company unless the Required Holders (as defined in the Series B Certificate
+of Designation) consent to the creation of other capital stock of the Company that is senior or equal in rank to the Series B Preferred
+Stock.
+
+ 
+
+Dividends.
+The holders of Series B Preferred Stock will be entitled to dividends, on an as-if converted basis, equal to and in the same form as
+dividends actually paid on shares of the Company s Common Stock, when and if actually paid.
+
+ 
+
+Purchase
+Rights. If at any time the Company grants, issues or sells any options, convertible securities, or rights to purchase stock, warrants,
+securities or other property pro rata to all or substantially all of the record holders of any class of Common Stock (the Purchase
+Rights ), then each holder of Series B Preferred Stock will be entitled to acquire, upon the terms applicable to such Purchase
+Rights, the aggregate Purchase Rights which such holder could have acquired if such holder had held the number of shares of Common Stock
+acquirable upon complete conversion of all the Series B preferred stock held by such holder immediately prior to the date as of which
+the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights at the Alternate
+Conversion Price (as defined below); subject to certain limitations on beneficial ownership.
+
+ 
+
+ 10
+
+ 
+
+ 
+
+ 
+
+Conversion
+Rights
+
+ 
+
+Conversion
+at Option of Holder. Each holder of Series B preferred stock may convert all, or any part, of the outstanding Series B preferred
+stock, at any time at such holder s option, into shares of the Common Stock (which converted shares of Common Stock are referred
+to as Conversion Shares herein) at the fixed Conversion Price of $7.7644 which is subject to proportional
+adjustment upon the occurrence of any stock split, stock dividend, stock combination and/or similar transactions.
+
+ 
+
+Voluntary
+Adjustment Right. Subject to the rules and regulations of the Nasdaq, the Company has the right, at any time, with the written consent
+of the Required Holders, to lower the fixed conversion price to any amount and for any period of time deemed appropriate by the board
+of directors of the Company.
+
+ 
+
+Other
+Adjustments. The Company has agreed to seek stockholder approval at a special meeting of stockholders, of the issuance of conversion
+shares at a conversion price below the conversion price (the date of such approval, the Stockholder Approval Date ).
+
+ 
+
+If
+60 days, 90 days and 180 days following the occurrence of the later of (x) the Stockholder Approval Date and (y) the earlier of (a) the
+effective date of the registration statement to be filed pursuant to the Registration Rights Agreement and (b) the date that the Series
+B preferred stock is eligible to be resold without restriction under Rule 144 of the Securities Act of 1933, as amended (the Securities
+Act ), the Conversion Price then in effect is greater than the greater of $1.5528 and the Market Price (as defined in the Certificate
+of Designations) then in effect (each, an Adjustment Price ), the conversion price shall automatically lower to such Adjustment
+Price.
+
+ 
+
+Change
+of Control Exchange. Upon a change of control of the Company, each holder may require the Company to exchange the holder s
+shares of Series B preferred stock for consideration equal to the Change of Control Election Price (as defined in the Series B Certificate
+of Designation), to be satisfied at the Company s election in either (x) cash or (y) rights convertible into such securities or
+other assets to which such holder would have been entitled with respect to such shares of Common Stock had such shares of Common Stock
+been held by such holder upon consummation of such corporate event.
+
+ 
+
+Company
+Optional Redemption. At any time the Company shall have the right to redeem in cash all, but not less than all, the shares of Series
+B preferred stock then outstanding at a redemption price equal to 120% of the greater of (i) the Conversion Amount being redeemed as
+of the Company optional redemption date and (ii) the product of (1) the conversion rate with respect to the Conversion Amount being redeemed
+as of the Company optional redemption date multiplied by (2) the greatest closing sale price of the Common Stock on any Trading Day during
+the period commencing on the date immediately preceding such Company optional redemption notice date and ending on the Trading Day immediately
+prior to the date the Company makes the entire payment required to be made.
+
+ 
+
+Fundamental
+Transactions. The Series B Certificate of Designation prohibits the Company from entering specified fundamental transactions (including,
+without limitation, mergers, business combinations and similar transactions) unless the Company (or the Company s successor) assumes
+in writing all of the Company s obligations under the Certificate of Designations and the other Transaction Documents (as defined
+in the Series B Certificate of Designation).
+
+ 
+
+Voting
+Rights. The holders of the Series B preferred stock shall have no voting power and no right to vote on any matter at any time, either
+as a separate series or class or together with any other series or class of share of capital stock, and shall not be entitled to call
+a meeting of such holders for any purpose nor shall they be entitled to participate in any meeting of the holders of Common Stock, except
+as provided in the Certificate of Designations (or as otherwise required by applicable law).
+
+ 
+
+Abaca
+Merger Shares
+
+ 
+
+On
+October 26, 2023, the Company issued 250,000 Abaca Warrants to the Abaca Holders, in connection with the Second Amendment to the
+Merger Agreement (the Second Amendment ) and the First Amendment to the Second Amendment dated February 27, 2024 . The
+Abaca Warrants have an exercise price of $40.00 per share of Common Stock to be paid in cash. An Abaca Warrant may be exercised only
+during the period (the Exercise Period ) commencing October 26, 2023 and terminating October 25, 2028 (the Expiration Date ).
+
+ 
+
+The
+Second Amendment also added a Third Anniversary Consideration Payment of $1,500,000 which was payable in cash, stock, or a combination
+of both at the Company s discretion. On October 5, 2025, the Company issued 37,517 shares of Common Stock to the Abaca Holders
+pursuant to the Second Amendment (the Abaca Shares ).
+
+ 
+
+ 11
+
+ 
+
+ 
+
+ 
+
+RISK
+FACTORS
+
+ 
+
+We
+are subject to risks and uncertainties that could potentially negatively impact our business, financial conditions, results of operations
+and cash flows. This section contains a description of the risk and uncertainties identified by management that could, individually or
+in combination, harm our business, results of operations, liquidity and financial condition, as well as our financial instruments and
+our securities. In evaluating us and our business and making or continuing an investment in our securities, you should carefully consider
+the risks described below as well as other information contained in this prospectus and any risk factors and uncertainties discussed
+in our other public filings with the SEC under the caption Risk Factors. We may face other risks that are not contained
+in this prospectus, including additional risk that are not presently known, or that we presently deem immaterial. This prospectus and
+the risks discussed below also include forward-looking statements, and our actual results may differ substantially from those discussed
+in such forward-looking statements. Please refer to the sections in this prospectus titled
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/SNDK_sandisk_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/SNDK_sandisk_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/SNDK_sandisk_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/SONDW_sonder_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/SONDW_sonder_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..7e45ffd2a463025c3010070a9dc1c1aa83d43f76
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/SONDW_sonder_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY The following summary highlights information contained elsewhere in this prospectus. Because it is a summary, it does not contain all the information you should consider before investing in our securities. Before you decide to invest in our securities, you should read this entire prospectus carefully, including the information included under the heading "Risk Factors." Company Overview We are a leading global brand of premium, design-forward apartments and intimate boutique hotels serving the modern traveler. Launched in 2014, Sonder offers inspiring, thoughtfully designed accommodations and innovative, tech-enabled service combined into one seamless experience. Sonder properties are found in prime locations in over 40 markets, spanning ten countries and three continents. The Sonder app gives guests full control over their stay. Complete with self-service features, simple check-in and 24/7 on-the-ground support, amenities and services at Sonder are just a tap away, making a world of better stays open to all. In the summer of 2024, we announced a strategic licensing agreement with Marriott International, Inc. ("Marriott"). As of September 30, 2024, we had approximately 10,100 units available for guests to book at over 200 properties in 44 cities in 10 countries. We work directly with real estate owners to lease properties that meet our standards, furnish and decorate them to provide a design-led, technology-enabled experience, and then make them available for guests to book directly (through the Sonder app, our website, or our sales personnel) or through indirect channels (such as Airbnb, Expedia, Booking.com, and other online travel agencies). We manage our properties using proprietary and third-party technologies and deliver services to guests via the Sonder app and 24/7 on-the-ground support. Our mobile-first guest experience, from check-in to check-out, is supported by the Sonder app. Incorporating technology into all aspects of the business, we offer consistent quality at a compelling value to our guests. Our accommodations come in a variety of shapes and sizes to suit guests needs – from a multiple-bedroom apartment with fully-equipped kitchen and private laundry facilities, to a hotel room or suite. Our diverse product portfolio serves various traveler types, including leisure travelers, families, digital nomads, and business travelers. Our interior designers and other teams take pride in bringing inspiring spaces to life throughout our portfolio. In addition to modern design, we apply technology across our business. Our guest-facing technology leads guests through their entire Sonder experience, beginning with easy, intuitive browsing of our full portfolio and reserving a unit, to in-app check-in and requests for intra-stay cleans, early check-in, or other services. Technology also underpins our hospitality operations, from underwriting and supply growth, to building openings, pricing and revenue management, demand generation, interior design, and day-to-day operations. By leveraging technology, our goal is to reduce operating costs and provide both a better guest experience and a compelling value. Recent Developments Nasdaq Notices On October 1, 2024, we received a letter (the "Staff Determination Letter") from the Staff of the Listing Qualifications Department (the "Staff") of Nasdaq notifying the Company that we had filed our Annual Report on Form 10-K for the year ended December 31, 2023 (the "2023 Annual Report") with the Securities and Exchange Commission (the "SEC") but that the Company had not filed our Quarterly Report on Form 10-Q for the quarters ended June 30, 2024 (the "Q2 2024 Form 10-Q") and March 31, 2024 (the "Q1 2024 Form 10-Q," and collectively with the Q2 2024 Form 10-Q, the "Delinquent Filings") by September 30, 2024, the deadline by which the Company was to file our Delinquent Filings in order to regain compliance with Nasdaq Listing Rule 5250(c)(1) (the "Rule"). The Staff Determination Letter stated that (i) the Staff had determined that the Common Stock and Public Warrants would be suspended from The Nasdaq Global Select Market at the opening of business on October 10, 2024, and (ii) a Form 25-NSE would be filed with the SEC, which would remove the Company s securities from listing and registration on The Nasdaq Stock Market. The Staff Determination Letter further noted that the Company may appeal the Staff s determination to a Hearings Panel (the "Hearings Panel"), pursuant to the procedures set forth in the Nasdaq Listing Rule 5800 Series. On October 2, 2024, the Company submitted an appeal to Nasdaq requesting a hearing before the Hearings Panel at which we intend to present our plan to regain and thereafter maintain compliance with all applicable listing requirements. In connection with our request for a hearing, the Company also requested a stay of the suspension of trading and delisting of our Common Stock and Public Warrants, pending the hearing and decision of the Hearings Panel. 1 On October 23, 2024, the Company received a letter from the Staff notifying the Company that the Hearings Panel had granted the Company s request to stay the suspension of trading and delisting pending a hearing on the merits scheduled to occur on November 14, 2024, and the subsequent decision of the Hearings Panel after the hearing. Nasdaq information states that the Hearings Panel typically issues a decision within 30 days of the hearing. On November 4, 2024, the Company filed both the Q1 2024 Form 10-Q and the Q2 2024 Form 10-Q. On November 6, 2024, the Company received a letter (the "Compliance Letter") from the Staff notifying us that the Company was then in compliance with the Rule and that, as a result, the Hearings Panel had canceled the hearing. The Compliance Letter also stated that the Company would be subject to a Mandatory Panel Monitor for a period of one year from November 6, 2024. On November 4, 2024, the Company received a notice from Nasdaq notifying the Company that, because the Company was delinquent in filing the Quarterly Report on Form 10-Q for the quarter ended September 30, 2024 (the "Q3 Form 10-Q"), the Company was no longer in compliance with Nasdaq Listing Rule 5250(c)(1), which requires companies with securities listed on Nasdaq to timely file all required periodic reports with the SEC. On February 12, 2025, the Company filed the Q3 Form 10-Q. Amendments to Articles of Incorporation On October 1, 2024, following the approval of the stockholders at a special meeting of stockholders on September 30, 2024, the Company filed a certificate of amendment to the Company s amended and restated certificate of incorporation (as amended, the "Amended and Restated Certificate of Incorporation") with the Secretary of State of the State of Delaware to effect an increase in the number of authorized shares of Common Stock, effective as of 4:01 p.m., Eastern Time, on October 1, 2024. As of the effective time, the Company s total number of authorized shares of all classes of capital stock increased from 272,000,000 to 401,809,144. The number of authorized shares of Common Stock increased from 20,000,000 shares to 149,809,144 shares. The number of authorized shares of special voting common stock, par value $0.0001 per share ("Special Voting Common Stock"), remained unchanged, with 2,000,000 shares authorized. The number of authorized shares of preferred stock, par value $0.0001 per share ("Preferred Stock"), remained unchanged with 250,000,000 shares authorized. On December 23, 2024, following the approval of the stockholders at the Company s 2024 annual meeting of stockholders (the "2024 Annual Meeting"), the Company filed a certificate of amendment to the Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware to effect an increase in the number of authorized shares of capital stock of the Company, effective as of 4:01 p.m. Eastern Time on December 23, 2024. As of the effective time, the Company s total number of authorized shares of all classes of capital stock increased from 401,809,144 to 409,309,144. The number of authorized shares of Common Stock increased from 149,809,144 shares to 157,309,144 shares. The number of authorized shares of Special Voting Common Stock remained unchanged, with 2,000,000 shares authorized. The number of authorized shares of Preferred Stock remained unchanged with 250,000,000 shares authorized. Amendment to the 2021 Equity Incentive Plan On October 25, 2024, our Board approved an amendment to the 2021 Equity Incentive Plan increase the number of shares of Common Stock available for the issuance of awards under the 2021 Equity Incentive Plan to 9,957,029 shares of Common Stock, subject to automatic annual share increases as set forth in the 2021 Equity Incentive Plan, as amended. Such amendment was approved at the 2024 Annual Meeting and became effective as of December 23, 2024. Risk Factor Summary Below is a summary of the principal factors that could materially harm our business, results of operations, financial condition, and/or cash flows, impair our future prospects, or cause the price of our publicly traded securities to decline. This summary does not address all of the risks that we face. Additional discussion of the risks summarized in this risk factor summary, and other risks that we face, can be found below and should be carefully considered, together with other information in this prospectus, before making an investment decision regarding our securities. The conversion of the Series A Preferred Stock into shares of Common Stock would dilute the current holders of our Common Stock. In addition, the exercise or conversion of currently outstanding securities would further dilute holders of our Common Stock. The Selling Stockholders may choose to sell shares of Common Stock at prices below the current market price. A large number of shares of Common Stock may be sold in the market by the Selling Stockholders, which may significantly depress the market price of our Common Stock. 2 Neither we nor the Selling Stockholders have authorized any other party to provide you with information concerning us or this offering. We may be unsuccessful in achieving positive, sustainable free cash flow, and our strategic initiatives and portfolio optimization program may not provide the expected benefits and could adversely affect us. Our actual results may differ materially from our forecasts and projections. Our results could be negatively affected by inflation and other macroeconomic factors and by changes in travel, hospitality, and real estate markets. We face risks and uncertainties associated with the license agreement with Marriott announced on August 19, 2024 (the "Marriott Agreement"), including the risk that it does not provide the anticipated benefits or results in unexpected expenses or other adverse effects. We may be unable to negotiate satisfactory leases or other arrangements to operate new properties, amend existing leases, onboard new properties in a timely manner, or renew or replace existing properties on satisfactory terms or at all. Newly leased properties may generate revenue later than we estimated and may be more difficult or expensive to integrate into our operations than expected. Delays in real estate development and construction projects could adversely affect our ability to generate revenue from the related leased properties. Our limited operating history and evolving business make it difficult to evaluate our future prospects and challenges. We have a history of net losses, and we may not be able to achieve or maintain profitability in the future. We depend on landlords to deliver properties in a suitable condition and to manage and maintain them. Our long-term and fixed-cost leases limit our operating flexibility and could adversely affect our liquidity. Our leases may be subject to termination prior to the scheduled expiration of the term, which can be disruptive and costly. Our long-term success depends, in part, on our ability to expand internationally, and our business is susceptible to risks associated with international operations. We may be unable to effectively manage our growth. We may be unable to attract new guests or generate repeat bookings from previous guests. Our success depends on acceptance by guests and property owners of our distinctive type of hospitality services. We operate in the highly competitive hospitality market. Third-party distribution channels have historically accounted for a substantial percentage of our bookings and business generated through such channels could adversely affect guest loyalty and poses other risks to us. Our results of operations vary from period-to-period, and historical performance may not be indicative of future performance. Certain measures we use to evaluate our operating performance may be subject to future adjustments. Our business depends on our reputation and the strength of our brand, and any deterioration could adversely impact our market share, revenues, business, results of operations, financial condition, and cash flows. We are involved in and may in the future become involved in claims, lawsuits, and other proceedings that could adversely affect our business, results of operations, financial condition, and cash flows and our insurance may be inadequate to cover our losses. We may be subject to liability or reputational damage for guests activities or other incidents and potential health and safety issues at our properties. We are subject to the risk of financial and reputational damage due to fraud. We face challenges in attracting and retaining key personnel and sufficient, highly skilled personnel, and are subject to risks, including unionized labor, associated with employment of hospitality personnel and the use of third-party contractors. We have identified and may in the future identify material weaknesses in our internal control over financial reporting or we may otherwise fail to maintain an effective system of internal controls, which may result in material misstatements of our consolidated financial statements. If we fail to maintain effective disclosure controls, our ability to produce timely and accurate financial statements or comply with applicable regulations could be impaired. We face risks related to the restatement of our previously issued financial statements, including risks associated with related litigation or other legal or governmental proceedings, the risk that additional accounting errors or corrections will be identified, and the possibility of additional delays in our SEC filings. 3 We have been in non-compliance and may in the future be in non-compliance with Nasdaq s listing requirements, and any failure to maintain compliance with Nasdaq s requirements may result in our Common Stock and publicly traded warrants being delisted and could adversely affect our ability to raise capital and have other adverse effects on us. Our business could be harmed if we are unable to adapt to changes in technology. We rely on third parties for certain services and technologies, including payment processing, and any unavailability, failures or defects in these services or technologies, or any difficulties integrating them into our systems, could harm our business and results of operations. Our processing, storage, use and disclosure of personal data expose us to risks of internal or external security breaches and has given rise and could give rise to claims, governmental investigations and penalties, other liabilities, increased costs including higher insurance premiums, damage to reputation, and/or reduced revenue. Limitations in our technologies, systems, and network infrastructure, or disruptions in Internet access or guests usage of mobile devices, could adversely affect us. Supply chain interruptions may increase our costs or reduce our revenues. Public health concerns and any future public health crises, may have a negative impact on us. We face risks related to our intellectual property. Costs relating to the opening, operation and maintenance of our leased properties could be higher than expected. Our properties are concentrated in a limited number of cities, which increases our exposure to local factors affecting demand or hospitality operations. We may be unable to introduce upgraded amenities, services or features for our guests in a timely and cost-efficient manner. Failure to comply with governmental regulations, such as securities regulations, anti-bribery laws, import/export controls (including sanctions), privacy, data protection, consumer protection, marketing, and advertising laws could adversely affect us. Our business is highly regulated across multiple jurisdictions, including evolving and sometimes uncertain short-term rental regulations and tax laws, which may limit our growth, cause us to incur compliance costs, or otherwise negatively affect us. There is substantial doubt about the Company s ability to continue as a going concern, and this may adversely affect our stock price, our ability to raise capital, and our relationships with key stakeholders. We may require additional capital, which might not be available in a timely manner or on favorable terms. Our indebtedness and credit facilities contain financial covenants and other restrictions that may limit our operational and financial flexibility or otherwise adversely affect us, including as a result of a potential Event of Default under our Delayed Draw Notes, and future financing arrangements may also contain restrictive covenants or other onerous provisions. Corporate Information We were originally incorporated in Delaware on July 21, 2020 under the name "Gores Metropoulos II, Inc." as a special purpose acquisition company, formed for the purpose of effecting an initial business combination with one or more target businesses. On January 22, 2021, we consummated our initial public offering. On January 18, 2022, we consummated a Business Combination with Legacy Sonder and changed our name to Sonder Holdings Inc. Our principal executive offices are located at 447 Sutter St., Suite 405 #542, San Francisco, CA 94108. Our telephone number is (617) 300-0956. Our website is https://www.sonder.com. Information contained on, or that can be accessed through, our website is not a part of, and is not incorporated into, this prospectus, and the inclusion of our website address in this prospectus is an inactive textual reference only. Implications of Being an Emerging Growth Company We are an emerging growth company as defined in Section 2(a) of the Securities Act of 1933, as amended (the "Securities Act"), and have elected to take advantage of the benefits of the extended transition period for new or revised financial accounting standards. We will remain an emerging growth company until the earliest of: (i) the last day of the fiscal year in which the market value of Common Stock that is held by non-affiliates exceeds $700 million as of the end of that year s second fiscal quarter; (ii) the last day of the fiscal year in which we have total annual gross revenue of $1.235 billion or more during such fiscal year (as indexed for inflation); (iii) the date on which we have issued more than $1 billion in non-convertible debt in the prior three-year period; or (iv) December 31, 2026, and we expect to continue to take advantage of the benefits of the extended transition period, although we may decide to early adopt such new or revised accounting standards to the extent permitted by such standards. This may make it difficult or impossible to compare our financial results with the financial results of another public company that is either not an emerging growth company or is an emerging growth company that has chosen not to take advantage of the extended transition period exemptions because of the potential differences in accounting standards used. 4 Section 107 of the JOBS Act provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected not to opt out of such extended transition period, which means that when a standard is issued or revised and it has different application dates for public or private companies, we, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of our financial statements with certain other public companies difficult or impossible because of the potential differences in accounting standards used. Implications of Being a Smaller Reporting Company We are a "smaller reporting company," meaning that the market value of our stock held by non-affiliates is less than $700 million and our annual revenue was less than $100 million during our most recently completed fiscal year. We may continue to be a smaller reporting company if either (i) the market value of our stock held by non-affiliates is less than $250 million measured on the last business day of our second fiscal quarter or (ii) our annual revenue is less than $100 million during the most recently completed fiscal year and the market value of our stock held by non-affiliates is less than $700 million measured on the last business day of our second fiscal quarter. For so long as we remain a smaller reporting company, we are permitted and intend to rely on exemptions from certain disclosure and other requirements that are applicable to other public companies that are not smaller reporting companies. 5
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+SUMMARY OF THE PROSPECTUS
+This summary highlights selected information from this prospectus and does not contain all of the information that is important to you. You should carefully read this entire prospectus and the other documents referred to in this prospectus, including the information presented under the sections titled Risk Factors, Cautionary Statement Regarding Forward Looking Statements, Management s Discussion and Analysis of Financial Condition and Results of Operations, and the consolidated financial statements and the related notes thereto included elsewhere in this prospectus, before making an investment decision. The definition of some of the terms used in this prospectus are set forth under the section Selected Definitions. For additional information, see the section of this prospectus entitled Where You Can Find More Information. Unless the context otherwise requires, all references in this subsection to we, us or our refer to the business of SIBS prior to the consummation of the Business Combination, and collectively to the Company and its subsidiaries, including SIBS, following the consummation of the Business Combination.
+The Company
+Our mission is to develop and deploy security screening systems that protect travelers and other members of the public from criminals, terrorists and other bad actors. We have developed a proprietary fixed-gantry Computed Tomography ( CT ) scanning system that detects explosives, weapons, narcotics and other contraband. CT is an X-ray scanning technology that combines a series of X-ray images taken from different angles around items being scanned and uses computer processing to create cross-sectional images of the item, which are reconstructed into a three dimensional image of the scanned item.
+Our initial market focus is domestic and international aviation checkpoints. However, we believe a significant market opportunity also exists for deploying our scanners in (i) other government facilities such as border crossings, seaports, military bases, embassies, federal buildings, prisons and postal facilities and (ii) the private sector at manufacturing plants, entertainment facilities, power plants, petrochemical facilities, convention centers, schools, sports stadiums and other highly-trafficked public buildings or venues.
+Our SENTINEL fixed-gantry scanner has already achieved several third-party certifications, including the TSA s Tier 2 Explosive Detection Certification. Certification to the TSA s Accessible Property Screening System 6.2.0 Explosive Detection Standard ( APSS 6.2 ) and to the European Civil Aviation Conference ( ECAC ) Explosive Detection System for Cabin Baggage Certification ( EDSCB ) are underway in advanced stages. Tier 2, APSS 6.2 and EDSCB are the explosive detection standards required for carry-on or cabin baggage X-ray inspection scanners to be deployed in U.S. and European airports. These standards are also required in other international airports.
+We have completed EDSCB explosive data collection at an ECAC laboratory and are in the process of benchmarking and updating our explosive detection algorithms in preparation for taking the ECAC EDSCB certification test. Likewise, we have completed APSS 6.2 military and commercial explosive data collection and are in the process of collecting APSS 6.2 home-made explosive data collection at Department of Homeland Security (DHS) laboratories in preparation for taking the TSA APSS 6.2 certification test.
+We believe that our scanner systems and fixed-gantry CT technology have significant advantages as compared to traditional rotating-gantry CT systems. However, we face significant challenges in scaling this technology and our business in the highly competitive aviation sector.
+First and foremost, although our fixed-gantry CT technology shows promise in disrupting traditional rotating-gantry CT technologies, we are a small company competing against much larger, better financed and staffed, economically stable and in some cases incumbent large businesses. Several of our competitors have been certified to both TSA s APSS 6.2 and ECAC s EDSCB explosive detection standards and have won competitive bids and have deployed and have operating systems in both the aviation and critical infrastructure sectors.
+As a small company, we must also overcome challenges associated with rapidly growing manufacturing, distribution, sales, installation and servicing capacities to meet industry and customer expectations. Our plans to establish strategic partnerships to assist in scaling our capabilities in these areas are in the early stages of development. In addition, the company must secure enough external investments to fund this growth.
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+Finally, the ECAC EDSCB and the TSA APSS 6.2 certification tests are extremely difficult to pass. We have completed most of the required data collection and are in the process of updating our explosive detection standards in preparation to take these certification tests. Although we have successfully passed the TSA Tier 2 explosive detection test and the results of our TSA APSS 6.2 and ECAC EDSCB explosive data collection are promising, to date, we have not taken and successfully passed either of these explosive certification tests, and cannot guarantee that we will ever do so.
+Our business strategy is focused on both the aviation and infrastructure sectors, in domestic and international markets. Failing to receive TSA and ECAC certification would make it impossible for us to sell our scanners to aviation customers in the U.S. and European Union, and in other countries that have adopted these certifications. We would still be able to sell to non-aviation customers, but such customers may be less likely to purchase scanners that have not been deployed and validated in the aviation market.
+The Business Combination
+On September 5, 2023, Mars Acquisition Corp. ( Mars ), a Cayman Island exempted company, entered into a Business Combination Agreement (as amended or supplemented, the Business Combination Agreement ) with ScanTech AI Systems Inc., a Delaware corporation and a wholly owned subsidiary of Mars ( ScanTech AI ), Mars Merger Sub I Corp., a Cayman Islands exempted company and a wholly owned subsidiary of Mars ( Purchaser Merger Sub ), Mars Merger Sub II LLC, a Delaware limited liability company and a wholly owned subsidiary of ScanTech AI ( Company Merger Sub ), ScanTech Identification Beam Systems, LLC, a Delaware limited liability company ( ScanTech, SIBS, or the Company ), and Dolan Falconer in the capacity as the representative from and after the Effective Time for the Company Holder Participants as of immediately prior to the Effective (the Seller Representative ). The transactions contemplated by the Business Combination Agreement are hereinafter referred to collectively as the Business Combination. 
+In accordance with the terms and subject to the conditions of the Business Combination Agreement:
+ At the closing of the Business Combination, which occurred on January 2, 2025 ( Closing ), Purchaser Merger Sub merged with and into Mars, with Mars continuing as the surviving entity ( Purchaser Merger ), and, in connection therewith, each ordinary shares of Mars ( Ordinary Share ) issued and outstanding immediately prior to the Effective Time will be cancelled in exchange for the right of the holder thereof to receive, with respect to each Ordinary Share that is not redeemed or converted at Closing, one share of common stock of ScanTech AI ( Common Stock ). Each share of Ordinary Shares held by Mars shareholders who validly redeemed their Ordinary Shares was automatically cancelled and ceased to exist and thereafter represented only the right to be paid a pro-rata redemption price. Upon the consummation of the Business Combination, Mars ceased to exist as a separate legal entity, and ScanTech AI became the publicly traded parent company.
+ At the Closing, each issued and outstanding unit of Mars ( Unit ) was automatically separated into (i) one Ordinary Share, which was cancelled in exchange for the right of the holder thereof to receive one our Common Stock and, (ii) one right ( Right ) to receive two-tenths (2/10) of one share of Ordinary Share, which was cancelled in exchange for the right of the holder thereof to receive our Common Stock.
+ At the Closing, Company Merger Sub merged with and into ScanTech, with ScanTech continuing as the surviving entity ( Company Merger , and together with the Purchaser Merger, the Mergers ), and, in connection therewith, (i) ScanTech Units issued and outstanding immediately prior to the Effective Time were cancelled in exchange for the right of the holders thereof to receive shares of our Common Stock as set forth in the Business Combination Agreement and (ii) any SIBS Convertible Securities will be terminated.
+ After ninety days following the Closing or such other period as may be agreed by parties to the Business Combination Agreement, Public Shareholders who elected not to redeem at the closing received two additional shares of our Common Stock.
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+The merger consideration paid to Company Holder Participants was a number of shares of our Common Stock equal to the quotient obtained by dividing (a) the sum of (i) $140.0 million minus (ii) the amount of Closing Net Debt in excess of $20.0 million, if any, as set forth in the Business Combination Agreement, as amended, by (b) $9.87, the conversion ratio set forth in the Business Combination Agreement, and rounded down to the nearest whole share. Upon Closing, holders of ScanTech Units collectively held 14,184,397 shares of our Common Stock.
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+Additionally, the Company Holder Participants may receive up to a number of shares of our Common Stock equal to 10% of the fully diluted shares of our Common Stock outstanding immediately following the Closing (subject to adjustment based on stock splits and similar events) as Earnout Shares upon the achievement of the Earnout Milestones over the Earnout Period.
+Upon the Closing, Mars and ScanTech each became wholly owned subsidiaries of ScanTech AI, all upon the terms and subject to the conditions set forth in the Business Combination Agreement and in accordance with the provisions of applicable law.
+The Mars Units, Ordinary Shares, and Rights under the symbols MARXU , MARX and MARXR , respectively, previously traded on Nasdaq Capital Market were delisted without any action needed to be taken on the part of the holders of such securities and are no longer traded following the Closing. On January 3, 2025, one business day after the Closing, our Common Stock was listed on the Nasdaq Global Market under trading symbol STAI .
+The Transaction Financing
+Polar Non-Redemption Agreement
+On December 30, 2024, Mars and Polar Multi-Strategy Master Fund ( Polar ) entered into a non-redemption agreement. Under the agreement, Polar agrees not to redeem 200,000 Ordinary Shares and to leave $750,000 in the Trust Account as a transaction financing in connection with the Business Combination, which corresponds to the amount Polar would have received if it had redeemed the shares.
+Additionally, Polar agreed to reduce its entitlement from 1,250,000 subscription shares under the Subscription Agreements dated April 4, 2024, and May 5, 2024, to 312,500 shares of our Common Stock.
+Seaport Promissory Note
+On December 31, 2024, Seaport Group SIBS LLC, an affiliate of Seaport Global Asset Management, LLC ( Seaport ), and ScanTech AI entered into a senior unsecured promissory note ( Seaport Promissory Note ), pursuant to which Seaport provided ScanTech AI with an investment of $1,000,000 as transaction financing in connection with the Business Combination. Seaport will receive 303,951 shares of our Common Stock as repayment of the investment under the Seaport Promissory Note, including any and all accrued interest, with such shares being issuable and registered at the time of ScanTech AI s filing of a follow-on registration statement immediately following the consummation of the Business Combination.
+Seaport Credit Facility
+On December 31, 2024, Seaport SIBS LLC, an affiliate of Seaport Global Asset Management, LLC, entered into a senior secured credit facility with ScanTech AI (the Seaport Credit Facility ) for a maximum of $2,000,000, with the initial advance available 15 days after execution. The principal amount and accrued interest are due upon demand no later than twelve months from the date of funding. The facility bears Payment-In-Kind (PIK) interest at 15.0% per annum, calculated on a 360-day year. Secured by the borrower s collateral pool, the facility designates the holder as a party to the Intercreditor Agreement dated September 24, 2024.
+Emerging Growth Company
+We are an emerging growth company, as defined in Section 2(a) of the Securities Act, as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ), and we may take advantage of reduced reporting requirements that are otherwise applicable to public companies. Section 107 of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies are required to comply with those standards. The JOBS Act also exempts us from having to provide an auditor attestation of internal control over financial reporting under Sarbanes-Oxley Act Section 404(b).
+We will remain an emerging growth company until the earlier of: (i) the last day of the fiscal year (a) following the fifth anniversary of the Closing Date, (b) in which we have an annual total gross revenue of at least US$1.235 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our ordinary equity that is held by non-affiliates exceeds US$700 million as of the last business day of the second fiscal quarter of such fiscal year; and (ii) the date on which we have issued more than US$1 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company have the meaning associated with it in the JOBS Act.
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+Summary of Risk Factors
+The following summary description sets forth an overview of the material risks we are exposed to in the normal course of our business activities. The summary does not purport to be complete and is qualified in its entirety by reference to the full risk factor discussion immediately following this summary description. We encourage you to read the full risk factor discussion carefully.
+ ScanTech has a history of losses. ScanTech has not been profitable historically and may not achieve or maintain profitability in the future.
+ We may require additional capital to support business growth, and this capital might not be available on acceptable terms, if at all.
+ Our operating losses have raised substantial doubt regarding our ability to continue as a going concern, as stated in the auditors opinion, which includes an explanatory paragraph as of and for the years ended December 31, 2023 and 2022.
+ We may fail to obtain key certifications from the TSA and ECAC or to obtain certification during an opportune time in the acquisition cycles for new scanners.
+ We may acquire or invest in other companies or technologies in the future, which could divert management s attention, fail to meet our expectations, result in additional dilution to our stockholders, increase expenses, disrupt our operations or otherwise harm our operating results.
+ Our use of open source software could subject our proprietary software to general release, negatively affect our ability to offer our products and subject us to possible litigation.
+ Our intellectual property rights are valuable and any inability to protect our proprietary technology and intellectual property rights could substantially harm our business and operating results.
+ Confidentiality arrangements with employees and others may not adequately prevent disclosure of trade secrets and other proprietary information.
+ Our business is subject to complex and evolving laws and regulations regarding data privacy and security which could subject us to investigations, claims or monetary penalties against us, require us to change our business practices or otherwise adversely affect our revenues and profitability.
+ We have a substantial accrued payroll tax liability of approximately $6.0 million as of June 30, 2024. There is no guarantee we can resolve this liability to the satisfaction of the IRS.
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+Corporate Information
+ScanTech AI Systems Inc. was formed as a corporation under the laws of the State of Delaware on July 20, 2023.
+ScanTech Identification Beam Systems, LLC is a Delaware limited liability company organized in 2011. On December 31, 2024, ScanTech AI Systems Inc. merged with Mars Merger Sub II LLC with ScanTech survived and became a become wholly owned subsidiaries of ScanTech AI.
+Mars Acquisition Corp. (or Mars) is a blank check company incorporated as a Cayman Islands exempted company on April 23, 2021, for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. On December 31, 2024, Mars merged with Mars Merger Sub I Corp. with Mars survived and became a become wholly owned subsidiaries of ScanTech AI.
+The Business Combination was consummated on January 2, 2025. Upon the consummation of the Business Combination, Mars ceased to exist as a separate legal entity, ScanTech AI became the publicly traded parent company, and ScanTech Identification Beam Systems, LLC became a wholly owned subsidiary of ScanTech AI. The current corporate structure is illustrated in the diagram below:
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+On January 3, 2025, one business day after the Closing, the Common Stock of ScanTech AI was listed on the Nasdaq Global Market under trading symbol STAI .
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+Table of Contents
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+THE OFFERING
+The summary below describes the principal terms of the offering. The Description of Securities section of this prospectus contains a more detailed description of our Common Stock.
+Securities being registered for resale by the Selling Securityholders named in the prospectus
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+19,501,751 Shares of Common Stock
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+Offering prices
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+The securities offered by this prospectus may be offered and sold at prevailing market prices, privately negotiated prices or such other prices as the Selling Securityholders may determine. See Plan of Distribution. 
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+Use of proceeds
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+All of the Shares offered by the Selling Securityholders pursuant to this prospectus will be sold by the Selling Securityholders for their respective amounts. We will not directly receive any of the proceeds from these sales.
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+Lock-up restrictions
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+Certain of our shareholders are subject to certain restrictions on transfer until the termination of applicable lock-up periods. See Securities Eligible for Future Sales-Lock-Up. 
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+Dividend policy
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+We have never declared or paid any cash dividends. Our board of directors ( Board ) will consider whether or not to institute a dividend policy. We presently intend to retain our earnings for use in business operations and, accordingly, it is not anticipated that our Board will declare dividends in the foreseeable future. We have not identified a paying agent. See Dividend Policy. 
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+Risk factors
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+Prospective investors should carefully consider the section titled Risk Factors for a discussion of factors you should carefully consider before deciding to invest in the securities offered hereby.
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+Market for our Shares
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+Our Common Stock is listed on The Nasdaq Global Market under the symbol STAI .
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+RISK FACTORS
+Our business and our industry are subject to significant risks. You should carefully consider all the information set forth in this prospectus and in our other filings with the SEC, including the following risk factors, in evaluating our business. If any of the following risks occur, our business, financial condition, operating results, and growth prospects would likely be materially and adversely affected. This prospectus also contains forward-looking statements that involve risks and uncertainties. See the section entitled Cautionary Statement Regarding Forward-Looking Statements. 
+Unless the context otherwise requires, all references in this subsection to we, us or our refer to the business of ScanTech prior to the consummation of the Business Combination, and collectively to the Company, following the consummation of the Business Combination.
+Risks Related to ScanTech s Business and Industry
+ScanTech has a history of losses. ScanTech has not been profitable historically and may not achieve or maintain profitability in the future.
+ScanTech has a history of losses. Its ability to forecast its future operating results is subject to a number of uncertainties, including our ability to plan for and model future growth. ScanTech has encountered and will continue to encounter risks and uncertainties frequently experienced by growing companies in rapidly evolving industries. If our assumptions regarding these uncertainties, which ScanTech uses to plan its business, are incorrect or change in reaction to changes in the markets it plans to serve, or if it does not address these risks successfully, ScanTech s operating and financial results could differ materially from expectations, its business could suffer and the trading price of ScanTech AI s stock may decline.
+ScanTech has incurred net losses of $18.4 million and $35.5 million for the years ended December 31, 2024 and 2023, respectively. As of March 31, 2025, ScanTech had an accumulated deficit of $187.2 million.
+ScanTech is not certain whether or when we will obtain a high enough volume of sales of its products to sustain or increase our growth or achieve or maintain profitability in the future. ScanTech expects its costs to increase in future periods, which could negatively affect its future operating results if its revenue does not increase. In particular, ScanTech expects to continue to expend substantial financial and other resources on:
+ research and development related to its products, including investments in expanding its research and development team;
+ sales and marketing, including a significant expansion of its sales organization, both direct and through distribution partners;
+ continued expansion of its business into new markets; and
+ general administration expenses, including legal and accounting expenses related to being a public company.
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+These investments may not result in increased revenue or growth in ScanTech s business. If ScanTech is unable to increase its revenue at a rate sufficient to offset the expected increase in its costs, its business, financial position, and results of operations will be harmed, and ScanTech may not be able to achieve or maintain profitability over the long term. Additionally, ScanTech may encounter unforeseen operating expenses, difficulties, complications, delays, and other unknown factors that may result in losses in future periods. If its revenue growth does not meet its expectations in future periods, our financial performance may be harmed, and ScanTech may not be able to achieve or maintain profitability in the future.
+We may require additional capital to support business growth, and this capital might not be available on acceptable terms, if at all.
+We intend to continue to make investments to support our business growth and may require additional funds to respond to business challenges, including the need to develop new features or enhance our products, improve our operating infrastructure, or acquire complementary businesses and technologies. Accordingly, we may need to engage in equity or debt financings to secure additional funds. If we raise additional funds through future issuances of equity or convertible debt securities, our existing stockholders could suffer significant dilution, and any new equity securities we issue could have rights, preferences and privileges superior to those of holders of our Common Stock. Any debt financing that we may secure in the future could involve restrictive covenants relating to our capital raising activities and other financial and operational matters, which may make it more difficult for us 
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+to obtain additional capital and to pursue business opportunities, including potential acquisitions. We may not be able to obtain additional financing on terms favorable to us, if at all. If we are unable to obtain adequate financing or financing on terms satisfactory to us when we require it, our ability to continue to support our business growth and to respond to business challenges could be significantly impaired, and our business may be adversely affected.
+Our operating losses have raised substantial doubt regarding our ability to continue as a going concern, as stated in the auditors opinion, which includes an explanatory paragraph as of and for the years ended December 31, 2024 and 2023.
+Our operating losses raise substantial doubt about our ability to continue as a going concern as of and for the years ended December 31, 2024 and 2023. As a result, our independent registered public accounting firm included an explanatory paragraph in its report on our financial statements as of and for the years ended December 31, 2024 and 2023 with respect to this uncertainty. The perception of our ability to continue as a going concern may make it more difficult for us to obtain financing for the continuation of our operations and could result in the loss of confidence by investors, suppliers and employees.
+As of March 31, 2025, we had $771,171 in cash, a significant working capital deficit of $38,290,825 and accumulated deficit of $187,165,447. For the three months ending March 31, 2025, net cash used in operating activities was $3,680,881. The Company s business plan is dependent on several factors, including securing customer agreements, achieving the Transportation Safety Administration s APSS 6.2 certification, and raising capital to fund operations, each of which may not occur. The Company is expected to continue to incur losses, and its ability to achieve and sustain profitability will depend on the achievement of sufficient revenues to support the Company s cost structure. The Company may never achieve profitability and, unless and until it does, the Company will need to continue to raise additional capital.
+We currently have very little cash resources and significantly greater current liabilities than current assets. The majority of our funding has been advances from Seaport Group SIBS LLC ( Seaport ). Should Seaport cease to make such advances prior to us obtaining other sources of financing sufficient to pay its expenses and current liabilities, we would be unable to continue in business.
+Historically, we have financed operations primarily through cash generated from debt offerings and equity raises. Our primary short-term requirements for liquidity and capital are to fund general working capital and capital expenditures. Our principal long-term working capital use primarily includes research and development expenses, operational payroll and development of scanning for customers.
+Our liquidity needs will be dependent on the performance of our business. We may be required to pursue additional financing sources or take other measures to improve our liquidity. As a result of the foregoing, management has determined that there is substantial doubt about the Company s ability to continue as a going concern for at least one year from the date these financial statements are issued.
+We are subject to governmental regulations in our key markets.
+We are subject to government regulation and other legal obligations, including those related to privacy, data protection, information security, and product marketing. There can be no assurances that such regulations do not change in the future or that we will be able to continue to maintain compliance with such regulations.
+We may fail to obtain key certifications from the TSA and ECAC or to obtain certification during an opportune time in the acquisition cycles for new scanners.
+New products for transportation security scanning applications require certifications or approvals by the TSA and ECAC, and are subject to extensive testing by both regulatory agencies. Our Sentinel CT product has already been certified at the Transportation Security Laboratory to TSA s Tier 2 Explosive Detection Standard, and testing to satisfy TSA s new APSS 6.2 Explosive Detection Standard ( APSS 6.2 ) is currently in process. Testing is also underway to satisfy ECAC s EDSCB Standard C2 and C3 Explosive Detection Standard ( EDSCB C2/3 ). If we do not succeed at obtaining APSS 6.2 or EDSCB C2/3 certification, market acceptance of our products could be materially limited.
+Additionally, even if we do obtain APSS 6.2 certification, we cannot guarantee that there will be sufficient demand from the TSA for our products due to the unique acquisition cycle for security scanners. The TSA replaces security scanners approximately every five to eight years, and once a scanner enters into use at an airport facility, the TSA will generally not upgrade or replace it until the end of this time period. As a result of this acquisition cycle, if obtaining APSS 6.2 certification takes longer than we expect or our 
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+competitors are more successful at soliciting purchases from the TSA, our financial performance may be harmed, and we may not be able to achieve or maintain profitability in the future.
+We are in the early stages of commercialization and our fixed gantry technology may never achieve significant commercial market acceptance.
+Many of our potential customers may be reluctant to use our fixed gantry technology. Market acceptance will depend on many factors, including our ability to convince potential customers of the advantages of our technology as compared to rotating gantry systems. Most potential customers have limited knowledge of, or experience with, our products. Additionally, any failure of our technology or related products to meet customer expectations could result in customers choosing to retain their existing products or to adopt systems other than ours. If our products fail to gain significant acceptance in the marketplace and we are unable to acquire customers, we may never generate sufficient revenue to achieve or sustain profitability.
+If we fail to properly manage our anticipated growth, our business could suffer.
+We intend to grow and may experience periods of rapid growth and expansion, which could place a significant additional strain on our limited personnel, information technology systems and other resources. Any failure by us to manage our growth effectively could have an adverse effect on our ability to achieve our commercialization and development goals.
+To achieve our goals, we must successfully increase manufacturing output to meet potential expected customer demand. In the future, we may experience difficulties with manufacturing, quality control, component supply, inventory, distribution and shortages of qualified personnel, among other problems. These problems could result in delays in availability of our scanner systems and increases in expenses. Any such delay or increased expense could adversely affect our ability to generate revenue.
+Future growth will also impose significant added responsibilities on management, including the need to identify, recruit, train and integrate additional employees. In addition, rapid and significant growth will place a strain on our administrative and operational infrastructure.
+In order to manage our operations and growth we will need to continue to improve our operational and management controls, reporting and information technology systems and financial internal control procedures. If we are unable to manage our growth effectively, it may be difficult for us to execute our business strategy and our operating results and business could suffer.
+We have limited experience commercializing our products or technology, which makes it difficult to evaluate our prospects and predict our products future performance.
+Our operations to date have been focused on developing and commercializing our technologies and products. There can be no assurance that we will be able to timely achieve market acceptance for our products in the future. We have limited experience developing our products and technology for commercial use, conducting sales and marketing activities at scale and managing customer support at the commercial level. Consequently, predictions about our future success or viability are highly uncertain and hard to predict as a result of the development stage of our products and our limited history commercializing our technologies or products. Our prospects must be considered in light of the uncertainties, risks, expenses, and difficulties frequently encountered by companies in their early stages of commercialization.
+Further, we are transitioning from a company with a focus on research and development to a company capable of supporting both research and development and commercial activities, and we may not be successful in this transition. We have encountered in the past, and will encounter in the future, risks and uncertainties, delays and scientific setbacks frequently experienced by development stage companies with limited operating histories in competitive and rapidly changing industries. If our assumptions regarding these risks and uncertainties, which we use to plan and operate our business, commercialization activities, are incorrect or change, or if we do not address these risks, delays or uncertainties successfully, our results of operations could differ materially from our expectations, and our business, financial condition and results of operations could be adversely affected.
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+Our sales will depend in part on our ability to establish and maintain confidence in our long-term business prospects among customers and others within our industry.
+Customers may be less likely to purchase our products if they do not believe that our business will succeed or that our operations, including service and customer support operations, will continue for many years. Similarly, suppliers and other third parties will be less likely to invest time and resources in developing business relationships with us if they are not convinced that our business will succeed. Accordingly, to build, maintain and grow our business, we must establish and maintain confidence among customers, suppliers and other parties with respect to our liquidity and long-term business prospects. Maintaining such confidence may be particularly difficult as a result of many factors, including our limited operating history, others unfamiliarity with our products, uncertainty regarding fixed-gantry technology, any delays in scaling production, delivery and service operations to meet demand, competition and our production and sales performance compared with market expectations. Some of these factors are largely outside of our control, and any negative perceptions about our long-term business prospects, even if exaggerated or unfounded, would likely harm our business and make it more difficult to raise additional capital in the future.
+If we are not able to establish our brand or reputation as an industry leader, our business and operating results may be adversely affected.
+We believe that developing a reputation as a leader in security screening is critical to our ability to attract new customers and distribution partners. The successful promotion of our brand will depend on multiple factors, including our marketing efforts, our ability to deliver a superior customer experience and develop high-quality features for our products and our ability to successfully differentiate our products from those of our competitors. Our brand promotion activities may not be successful or yield increased revenue. Additionally, the performance of our distribution partners may affect our brand and reputation if customers do not have a positive experience with our products as implemented by our distribution partners or with the implementation generally. The promotion of our brand will require us to make substantial expenditures, and we anticipate that the expenditures will increase as our market becomes more competitive, as we expand into new geographies and markets and as more sales are generated through our distribution partners. To the extent that these activities yield increased revenue, this revenue may not offset the increased expenses we incur. If we do not successfully maintain and enhance our brand and reputation, our business and operating results may be adversely affected.
+If our customers are unable to implement our products successfully, or if we fail to effectively train our customers in installation of our products, customer perceptions of our products may be impaired or our reputation and brand may suffer.
+Some of our customers may experience difficulties implementing our products. If our customers are unable to implement our products successfully, customer perceptions of our products may be impaired or our reputation and brand may suffer.
+Any failure by our customers to appropriately implement our products or any failure of our products to effectively integrate and operate within our customers operating environments could result in customer dissatisfaction, impact the perceived reliability of our products, result in negative press coverage, negatively affect our reputation and harm our financial results.
+Successful deployment and operation of our products depend on the knowledge and skill of the customer security personnel or implementation contractors charged with setting up, configuring, monitoring, and troubleshooting the equipment in their own environment. Many of our customers may experience relatively high turnover in their security personnel, creating opportunities for knowledge and skill gaps that can result in configuration, sensitivity setting, or operational errors that allow prohibited threats into customer facilities. In these situations, customers can perceive that our products have failed to perform as designed until and unless we have been able to demonstrate otherwise. There can be no assurance that we or our implementation partners will successfully isolate and identify failures due to customer error in the future, and this could result in customer dissatisfaction, impact the perceived reliability of our products, result in negative press coverage, negatively affect our reputation and harm our financial results.
+Our customers will depend in large part on customer support delivered by us to resolve issues relating to the use of our products. However, even with our support, our customers will be ultimately responsible for effectively using our products and ensuring that their staff is properly trained in the use of our products. We will also need to develop customer success and support organizations, including the engagement and training of third-party contractors. It can take significant time and resources to recruit, hire and train qualified technical support and service employees and contractors. We may not be able to keep up with demand, particularly if the sales of our products exceed our internal forecasts. To the extent that we are unsuccessful in hiring, training and retaining adequate support resources, our ability to provide adequate and timely support to our customers may be negatively impacted, and our customers satisfaction with our products may be adversely affected. Additionally, in unusual circumstances, if we were to need to 
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+rely on our sales engineers to provide post-sales support while we are growing our service organization, our sales productivity may be negatively impacted. Accordingly, any failure by us to provide satisfactory maintenance and technical support services could have a material and adverse effect on our business and results of operations.
+We have no experience to date in manufacture of our security scanners at commercial scale.
+We cannot provide any assurance as to whether we will be able to continue to develop efficient, low-cost production capabilities and processes and reliable sources of component supply that will enable us to meet the quality, price, engineering, design and production standards, as well as the production volumes, required to successfully market our security scanner systems on a commercial scale. Even if we are successful in developing high volume production capability and processes and reliably source our component supply, no assurance can be given as to whether we will be able to do so in a manner that avoids significant delays and cost overruns, including as a result of factors beyond our control such as problems with suppliers and vendors, or force majeure events, or to satisfy the requirements of customers and potential customers. Any failure to develop such production processes and capabilities within our projected costs and timelines could have a material adverse effect on our business, results of operations, prospects and financial condition. Bottlenecks and other unexpected challenges may also arise as we ramp up production of our security scanner systems, and it will be important that we address them promptly while continuing to control our manufacturing costs. If we are not successful in doing so, or if we experience issues with our manufacturing process improvements, we could face delays in establishing and/or sustaining production or be unable to meet our related cost and profitability targets.
+We face intense competition that can impact our ability to obtain contracts and therefore affect our future revenues and growth prospects.
+Our business is highly competitive, and we compete with larger companies with greater name recognition, financial resources and a larger technical staff. Our competitors include Leidos, Smiths Detection, Analogic Corporation and IDSS Corp. The markets in which we plan to operate are characterized by rapidly changing customer needs and technology and our success depends on our ability to invest in and develop products that address such needs. To remain competitive, we must consistently provide superior service, technology and performance on a cost-effective basis to our customers. Our competitors may be able to provide our customers with different or greater capabilities or technologies or better contract terms than we can provide, including technical qualifications, past contract experience, geographic presence, price and the availability of qualified professional personnel, or be willing to accept more risk or lower profitability in competing for contracts.
+Some of our competitors have made or could make acquisitions of businesses or establish agreements among themselves or third parties, which could allow them to offer more competitive and comprehensive solutions. As a result of such acquisitions or arrangements, our current or potential competitors may be able to accelerate the adoption of new technologies that better address customer needs, devote more significant resources to bring these products and services to market, initiate or withstand substantial price competition, develop and expand their product and service offerings more quickly than we do or limit our access to certain suppliers. These competitive pressures in our market or our failure to compete effectively may result in fewer orders, reduced revenue and margins and loss of market share. Further industry consolidation may also impact customers perceptions of the viability of smaller or even mid-size security system companies and consequently customers willingness to purchase from such companies.
+If we are unable to compete effectively with new entrants and other potential competitors, our sales and profitability could be adversely affected.
+The sales prices for our products may decline for a variety of reasons, including competitive pricing pressures, discounts, anticipation of the introduction of new products or promotional programs. Competition continues to increase in the market segments in which we participate, and we expect competition to further increase in the future, thereby leading to increased pricing pressures. Larger competitors with more diverse product offerings may reduce the price of products that compete with theirs or may bundle them with other products. Additionally, currency fluctuations in certain countries and regions may negatively impact prices that partners and customers are willing to pay in those countries and regions. We cannot be certain that we will be successful in developing and introducing new products with enhanced functionality on a timely basis, or that our new product offerings, if introduced, will enable us to maintain our prices and gross profits at levels that will allow us to maintain positive gross margins and achieve profitability.
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+If our products fail or are perceived to fail to detect threats such as a firearm or other potential weapon or explosive device, or if our products contain undetected errors or defects, these failures or errors could result in injury or loss of life, which could harm our brand and reputation and have an adverse effect on our business and results of operations.
+If our products fail or are perceived to fail to detect and prevent attacks or if our products fail to identify and respond to new and increasingly complex and unpredictable methods of attacks, our business and reputation may suffer. There is no guarantee that our products will detect and prevent all attacks, especially in light of the rapidly changing security landscape to which they must respond, as well as unique factors that may be present in our customers operating environments. Additionally, our products may falsely detect items that do not actually represent threats. These false positives may impair the perceived reliability of our products, and may therefore adversely impact market acceptance of our products, and could result in negative publicity, loss of customers and sales and increased costs to remedy any problem.
+Our products, which are complex, may also contain undetected errors or defects when first introduced or as new versions are released. We have experienced these errors or defects in the past in connection with new products and product upgrades. We expect that these errors or defects will be found from time to time in the future in new or enhanced products after commercial release. Defects may result in increased vulnerability to attacks, cause our products to fail to detect security threats, or temporarily interrupt our products ability to screen visitors in a customer s location. Any errors, defects, disruptions in service or other performance problems with our products may damage our customers business and could harm our reputation. If our products fail to detect security threats for any reason, including failures due to customer personnel or security processes, it may result in significant costs, the attention of our key personnel could be diverted, our customers may delay or withhold payment to us or cause other significant customer relations problems to arise.
+We may also be subject to liability claims for damages related to errors or defects in our products. For example, if our products fail to detect weapons or explosive devices that are subsequently used by terrorists, criminals or unbalanced individuals to cause casualties at a customer s premises, we could incur financial damages and our reputation could also be significantly harmed. A material liability claim or other occurrence that harms our reputation or decreases market acceptance of our products may harm our business and operating results. Although we have limitation of liability provisions in our terms and conditions of sale, they may not fully or effectively protect us from claims as a result of federal, state, or local laws or ordinances, or unfavorable judicial decisions in the United States or other countries.
+Our future products may be affected from time to time by design and manufacturing defects that could adversely affect our business and result in harm to our reputation.
+Our security scanners are complex and may contain undetected defects or errors when first introduced or as enhancements are released that, despite testing, are not discovered until after a product has been used. This could result in delayed market acceptance of those products or claims from distribution partners, customers, or others, which may result in litigation, increased end user warranty, support and repair or replacement costs, damage to our reputation and business, or significant costs and diversion of support and engineering personnel to correct the defect or error. We may from time to time become subject to warranty or product liability claims related to product quality issues that could lead us to incur significant expenses.
+We will include provisions in our agreements with customers that are designed to limit our exposure to potential liability for damages arising from defects or errors in our products. However, it is possible that these limitations may not be effective as a result of unfavorable judicial decisions or applicable laws in existence or enacted in the future.
+The sale and support of our products entails the risk of product liability claims. We maintain insurance to protect against certain claims associated with the use of our products, but our insurance coverage may not adequately cover any claim asserted against us. In addition, even claims that ultimately are unsuccessful could result in material expense, diversion of management time and attention, damage to our business and reputation and brand, and cause us to fail to attract new customers.
+If the general level of security threats and attacks declines, or is perceived by our potential customers to have declined, our business could be harmed.
+If security threats were to decline, or enterprises or governments perceived that the general level of security threats has declined, our ability to attract customers could be materially and adversely affected. A reduction in the threat landscape could increase our sales cycles and harm our business, results of operations and financial condition.
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+Our operating results may fluctuate for a variety of reasons, including our failure to close large volume opportunity customer sales.
+The timing of certain large volume opportunities is expected to impact our results from quarter to quarter. In addition, the sales cycle can last several months from initial engagement to contract negotiation and execution, culminating in delivery of our products to our customers, and this sales cycle can be even longer, less predictable and more resource-intensive for both larger volume sales as well as sales to customers in certain market segments. Customers may also require additional internal approvals or seek to pilot our products for a longer trial period before deciding to purchase our solutions. As a result, the timing of individual sales can be difficult to predict. Sales may occur in a quarter subsequent to when anticipated, or not occur at all, which can significantly impact our quarterly financial results and make it more difficult to meet market expectations. See Management s Discussion and Analysis of Financial Condition and Results of Operations Critical Accounting Policies Revenue Recognition. 
+In addition to the sales cycle-related fluctuations noted above, our financial results, including deferred revenue, are expected to vary as a result of numerous factors, many of which are outside of our control and may be difficult to predict, including:
+ our ability to attract and retain new customers;
+ unforeseen changes or delays in our supply chain or third-party manufacturing partners;
+ our ability to expand into adjacent and complementary markets;
+ changes in customer or distribution partner requirements or market needs;
+ changes in the growth rate of the security inspection and scanning market;
+ the timing and success of new product introductions by us or our competitors, or any other change in the competitive landscape of the security inspection and scanning market, including consolidation among our customers or competitors or significant price competition;
+ a disruption in, or termination of, any of our relationships with distribution partners;
+ our ability to successfully expand our business globally;
+ changes in our pricing policies or those of our competitors;
+ changes in financial markets or macroeconomic conditions, including, for example, due to the effects of the ongoing recession or slow economic growth in the United States and abroad, rising inflation and interest rates, fuel prices, international currency fluctuations, corruption, political instability, acts of war, including the conflict involving Russia and Ukraine, and acts of terrorism;
+ general economic conditions in our markets, including recessionary pressures;
+ future accounting pronouncements or changes in our accounting policies or practices;
+ the amount and timing of our operating costs, including cost of goods sold;
+ the impact of the COVID-19 pandemic and the emergence of new variants or a future outbreak of disease or similar public health concern on our customers, partners, employees, and supply chain; and
+ increases or decreases in our revenue and expenses caused by fluctuations in foreign currency exchange rates.
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+Any of the above factors, individually or in the aggregate, may result in significant fluctuations in our financial and other operating results from period to period. These fluctuations could result in our failure to meet our operating plan or the expectations of investors or analysts for any period. If we fail to meet such expectations for these or other reasons, the trading price of our Common Stock could fall substantially, and we could face costly lawsuits, including securities class action suits.
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+If we are unable to acquire new customers, our future revenues and operating results will be harmed. Likewise, potential customer turnover in the future, or costs we incur to retain customers, could materially and adversely affect our financial performance.
+Our success depends on our ability to acquire new customers in new and existing markets, and in new and existing geographic markets. If we are unable to attract a sufficient number of new customers, we may be unable to generate revenue growth at desired rates. The security scanning market is competitive and many of our competitors have substantial financial, personnel and other resources that they utilize to develop solutions and attract customers. As a result, it may be difficult for us to add new customers to our customer base. Competition in the marketplace may also lead us to win fewer new customers or result in us providing discounts and other commercial incentives. Additional factors that impact our ability to acquire new customers include the size of our prospective customers security budgets, the availability of government funding, the utility and efficacy of our existing and new products, whether proven or perceived, the perceived need for security inspection and scanning systems outside of airports and general economic conditions. These factors may have a meaningful negative impact on future revenues and operating results.
+While our immediate focus is on the United States market, our long-term success in part depends on our ability to acquire new customers outside the United States. If we are unable to attract a sufficient number of new customers outside the United States, we may be unable to generate future revenue growth at desired rates in the long term.
+If we do not successfully anticipate market needs and enhance our existing products or develop new products that meet those needs on a timely basis, we may not be able to compete effectively and our ability to generate revenues will suffer.
+We cannot guarantee that we will be able to anticipate future market needs and opportunities or be able to develop product enhancements or new products to meet such needs or opportunities in a timely manner, if at all. Even if we are able to anticipate, develop and commercially introduce enhancements and new products, there can be no assurance that enhancements or new products will achieve widespread market acceptance.
+New products, as well as enhancements to our existing products, could fail to attain sufficient market acceptance for many reasons, including:
+ delays in releasing new products, or product enhancements;
+ failure to accurately predict market demand and to supply products that meet this demand in a timely fashion;
+ inability to protect against new types of attacks or techniques used by terrorists or other threat sources;
+ defects in our products, errors or failures of our products;
+ negative publicity or perceptions about the performance or effectiveness of our products;
+ introduction or anticipated introduction of competing products by our competitors;
+ installation, configuration, sensitivity setting, or usage errors by our customers; and
+ easing or changing of regulatory requirements at the federal, state, and/or local levels related to security or other aspects of our business.
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+If we fail to anticipate market requirements or fail to develop and introduce product enhancements or new products to meet those needs in a timely manner, it could prevent us from gaining new customers, which would significantly harm our business, financial condition and results of operations.
+While we continue to invest significant resources in research and development to enable our products to continue to address the security risks that our customers face, the introduction of products embodying new technologies could also render our existing products or services obsolete or less attractive to customers. If we spend significant time and effort on research and development and are unable to generate an adequate return on our investment, our business and results of operations may be materially and adversely affected.
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+We utilize artificial intelligence, which could expose us to liability or adversely affect our business, especially if we are unable to compete effectively with others in adopting artificial intelligence.
+We utilize artificial intelligence, including machine learning and similar tools and technologies that collect, aggregate, analyze, or generate data or other materials or content (collectively, AI ) in connection with our business. There are significant risks involved in using AI and no assurance can be provided that our use of AI will enhance our products or services, produce the intended results, or keep pace with our competitors. For example, AI algorithms may be flawed, insufficient, of poor quality, rely upon incorrect or inaccurate data, reflect unwanted forms of bias, or contain other errors or inadequacies, any of which may not be easily detectable; AI has been known to produce false or hallucinatory inferences or outputs; our use of AI can present ethical issues and may subject us to new or heightened legal, regulatory, ethical, or other challenges; and inappropriate or controversial data practices by developers and end-users, or other factors adversely affecting public opinion of AI, could impair the acceptance of AI solutions, including those incorporated in our products and services. If the AI tools that we use are deficient, inaccurate, or controversial, we could incur operational inefficiencies, competitive harm, legal liability, brand or reputational harm, or other adverse impacts on our business and financial results. If we do not have sufficient rights to use the data or other material or content on which the AI tools we use rely, we also may incur liability through the violation of applicable laws and regulations, third-party intellectual property, data privacy, or other rights, or contracts to which we are a party.
+In addition, AI regulation is rapidly evolving worldwide as legislators and regulators increasingly focus on these powerful emerging technologies. The technologies underlying AI and its uses are subject to a variety of laws and regulations, including intellectual property, data privacy and security, consumer protection, competition, and equal opportunity laws, and are expected to be subject to increased regulation and new laws or new applications of existing laws and regulations. AI is the subject of ongoing review by various U.S. governmental and regulatory agencies, and various U.S. states and other foreign jurisdictions are applying, or are considering applying, their platform moderation, data privacy, and security laws and regulations to AI or are considering general legal frameworks for AI. For example, the EU s Artificial Intelligence Act, which entered into force in August 2024, establishes, among other things, a risk-based governance framework for regulating AI systems operating in the EU. We may not be able to anticipate how to respond to these rapidly evolving frameworks, and we may need to expend resources to adjust our operations or offerings in certain jurisdictions if the legal frameworks are inconsistent across jurisdictions. Furthermore, because AI technology itself is highly complex and rapidly developing, it is not possible to predict all of the legal, operational, or technological risks that may arise relating to the use of AI.
+A portion of our revenue will be generated by sales to government entities and such sales are subject to a number of challenges and risks.
+Selling to government entities can be highly competitive, expensive, and time-consuming, and often requires significant upfront time and expense without any assurance that it will win a sale. Government demand and payment for our solutions may also be impacted by changes in fiscal or contracting policies, changes in government programs or applicable requirements, the adoption of new laws or regulations or changes to existing laws or regulations, public sector budgetary cycles and funding authorizations, with funding reductions or delays adversely affecting public sector demand for our solutions. Accordingly, sales of our products to government entities may be more challenging than selling to commercial organizations, especially given extensive certification, clearance and security requirements. Government agencies may have statutory, contractual or other legal rights to terminate contracts with us or distribution partners. Further, in the course of providing our solutions to government entities, our employees and those of our distribution partners are exposed to sensitive government information. Any failure by us or our distribution partners to safeguard and maintain the confidentiality of such information could subject us to liability and reputational harm, which could materially and adversely affect our results of operations and financial performance. Governments routinely investigate and audit government contractors administrative processes, and any unfavorable audit may cause the government to shift away from our solutions and may result in a reduction of revenue, fines or civil or criminal liability if the audit uncovers improper or illegal activities, which could adversely impact our results or operations.
+We are subject to the U.S. government s security requirements for our facility and personnel security clearances, which are prerequisites to our ability to perform on contracts for the TSA.
+A facility security clearance is required for a company to perform on certain contracts for the TSA. Security clearances are subject to regulations and requirements including such requirements as those contained in the National Industrial Security Program Operating Manual (the NISPOM ), which specifies the requirements for the protection of classified information released or disclosed in connection with U.S. Government contracts. The Defense Counterintelligence and Security Agency ( DCSA ) manages the facility 
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+clearance process under the NISPOM and conducts various facility audits and inspections throughout the life cycle of a respective facility clearance.
+The U.S. government requires certain facility and personnel security clearances to perform classified U.S. government business. Any facility not staffed by appropriately cleared personnel, and/or that fails a DCSA inspection places the facility clearance and the ability to perform TSA contracts in jeopardy. As such, we must comply with the requirements of the NISPOM and other applicable U.S. government industrial security regulations. If we were to violate the terms and requirements of the NISPOM or such industrial security regulations (which apply to it under the terms of TSA contracts, if any), or if one or more of our facilities or personnel security clearances is invalidated or terminated, we may not be able to enter into TSA contracts, which could adversely affect our revenues. Failure to comply with the NISPOM or other security requirements may result in loss of access to classified information and subject us to civil and criminal penalties and administrative sanctions, including termination of contracts, forfeiture of profits, suspension of payments, fines and suspension or prohibition from doing business with the U.S. government, which could have an adverse effect on our business and cause reputational harm.
+Our operating results may be harmed if we are required to collect sales and use or other related taxes for our products in jurisdictions where we have not historically done so.
+Taxing jurisdictions, including state, local and foreign taxing authorities, have differing rules and regulations governing sales and use or other taxes, and these rules and regulations are subject to varying interpretations that may change over time. In particular, significant judgment is required in evaluating our tax positions and our worldwide provision for taxes. One or more states, localities or countries may seek to impose additional sales or other tax collection obligations on us. It is possible that we could face sales tax audits and that such audits could result in tax-related liabilities for which we have not accrued. A successful assertion that we should be collecting additional sales or other taxes on our products in jurisdictions where we have not historically done so and do not accrue for sales taxes could result in substantial tax liabilities for past sales, discourage customers from purchasing our products or otherwise harm our business and operating results.
+In addition, our tax obligations and effective tax rates could be adversely affected by changes in the relevant tax, accounting and other laws, regulations, principles and interpretations (such as the recent United States Inflation Reduction Act which, among other changes, introduced a 15% corporate minimum tax on certain United States corporations and a 1% excise tax on certain stock redemptions by United States corporations), including those relating to income tax nexus, jurisdictional mix of profits at varying statutory tax rates, by changes in foreign currency exchange rates, or by changes in the valuation of our deferred tax assets and liabilities. Although we believe our tax estimates are reasonable, the final determination of any tax audits or litigation could be materially different from our historical tax provisions and accruals, which could have a material adverse effect on our operating results or cash flows in the period or periods for which a determination is made.
+We may acquire or invest in other companies or technologies in the future, which could divert management s attention, fail to meet our expectations, result in additional dilution to our stockholders, increase expenses, disrupt our operations or otherwise harm our operating results.
+We may in the future acquire or invest in, businesses, products, or technologies that we believe could complement or expand our business, enhance our technical capabilities, or otherwise offer growth opportunities. We may not be able to fully realize the anticipated benefits of any future acquisitions or anticipated benefits may not transpire. The pursuit of potential acquisitions may divert the attention of management and cause us to incur various expenses related to identifying, investigating, and pursuing suitable acquisitions, whether or not they are consummated.
+There are inherent risks in integrating and managing acquisitions. If we acquire additional businesses, we may not be able to assimilate or integrate the acquired personnel, operations, products, services and technologies successfully or effectively manage the combined business following the acquisition and our management may be distracted from operating our business. We also may not achieve the anticipated benefits from the acquired business due to a number of factors, including, without limitation:
+ unanticipated costs or liabilities associated with the acquisition;
+ incurrence of acquisition-related costs, which would be recognized as a current period expense;
+ inability to generate sufficient revenue to offset acquisition or investment costs;
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+ inability to maintain relationships with customers and partners of the acquired business;
+ difficulty of incorporating acquired technology and rights into our business and of maintaining quality and security standards consistent with our brand;
+ delays in customer purchases due to uncertainty related to any acquisition;
+ the potential loss of key employees;
+ use of resources that are needed in other parts of our business and diversion of management and employee resources;
+ inability to recognize acquired deferred revenue in accordance with our revenue recognition policies; and
+ use of substantial portions of our available cash and equity or the incurrence of debt to consummate the acquisition.
+
+Acquisitions also increase the risk of unforeseen legal liability, including for potential shareholder suits or potential violations of applicable law or industry rules and regulations, arising from prior or ongoing acts or omissions by the acquired businesses that are not discovered by due diligence during the acquisition process or new regulatory restrictions at the federal, state, or local levels. Generally, if an acquired business fails to meet our expectations, our operating results, business and financial condition may suffer. Acquisitions could also result in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect our business, results of operations and financial condition.
+In addition, a significant portion of the purchase price of companies we acquire may be allocated to goodwill and other intangible assets, which must be assessed for impairment at least annually. If our acquisitions do not ultimately yield expected returns, we may be required to take charges to our operating results based on our impairment assessment process, which could harm our results of operations.
+We are increasingly dependent on information technology, and our systems and infrastructure face certain risks, including cybersecurity and data leakage risks.
+Significant disruptions to our information technology systems or breaches of information security could adversely affect our business. In the ordinary course of business, we collect, store, and transmit large amounts of sensitive information, and it is critical that we do so in a secure manner to maintain the confidentiality and integrity of such information. The size and complexity of our information technology systems, and those of our third-party vendors with whom we contract, make such systems potentially vulnerable to service interruptions and security breaches from inadvertent or intentional actions by our employees, partners, or vendors, from attacks by malicious third parties, or from intentional or accidental physical damage to our systems infrastructure maintained by us or by third parties. Maintaining the secrecy of this confidential, proprietary, or trade secret information is important to our competitive business position. While we have taken steps to protect such information and invested in information technology, there can be no assurance that our efforts will prevent service interruptions or security breaches in our systems or the unauthorized or inadvertent wrongful use or disclosure of confidential information that could adversely affect our business operations or result in the loss, dissemination, or misuse of critical or sensitive information. A breach of our security measures or the accidental loss, inadvertent disclosure, unapproved dissemination, misappropriation or misuse of trade secrets, proprietary information, or other confidential information, whether as a result of theft, hacking, fraud, trickery, or other forms of deception, or for any other reason, could enable others to produce competing products, use our proprietary technology or information, or adversely affect our business or financial condition. Further, any such interruption, security breach, loss, or disclosure of confidential information could result in financial, legal, business, and reputational harm to us and could have a material adverse effect on our business, financial position, results of operations, or cash flow.
+Our business and operations would suffer in the event of failures in our internal computer systems.
+Despite the implementation of security measures, our computer systems and those of our current and any future partners, contractors, and consultants are vulnerable to damage from computer viruses, unauthorized access, natural disasters, terrorism, war, and telecommunication and electrical failures. While we have not experienced any such material system failure, accident, or security breach to date, if such an event were to occur and cause interruptions in our operations, it could result in a material disruption of our manufacturing activities, development programs, and business operations. If we experienced a security breach, our online sources were hacked, or we experienced a data leak, it could result in confidential clinical trial data being leaked to competitors and the 
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+market. To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or applications, or inappropriate disclosure of confidential or proprietary information, we could incur liability and the further commercialization and development of our products could be delayed.
+Risks Related to Reliance on Third Parties
+We will rely on distribution partners to generate a portion of our revenue, both in the United States and in emerging international markets which are generally slower to develop. If we fail to maintain successful relationships with our distribution partners, or if our partners fail to perform, our ability to market, sell and distribute our products will be limited, and our business, financial position and results of operations will be harmed.
+In addition to a direct sales force, we will rely on our distribution partners to sell our products. We will provide our distribution partners with specific training and programs to assist them in selling and supporting our products, but there can be no assurance that these steps will be effective. In addition, our distribution partners may be unsuccessful in marketing, selling, and supporting our products.
+If we are unable to develop and maintain effective sales incentive programs for our third-party distribution partners, we may not be able to incentivize these partners to sell our products to customers. Our agreements with our distribution partners are generally non-exclusive and these partners may also market, sell and support products that are competitive with us and may devote more resources to the marketing, sales and support of such competitive products. These partners may have incentives to promote our competitors products to the detriment of ours or may cease selling our products altogether. Our distribution partners may cease or de-emphasize the marketing of our products with limited or no notice and with little or no penalty. Our agreements with our distribution partners may generally be terminated for any reason by either party with advance notice. It cannot be certain that we will retain these distribution partners or that we will be able to secure additional or replacement distribution partners. The loss of one or more of our significant distribution partners could harm our operating results. In addition, any new distribution partner requires extensive training and may take several months or more to achieve productivity. Our distribution partner sales structure could subject us to lawsuits, potential liability and reputational harm if, for example, any of our distribution partners misrepresent the functionality of our products to customers or violate laws or our corporate policies.
+If we fail to effectively manage our existing distribution partners, or if our distribution partners are unsuccessful in fulfilling orders for our products, or if we are unable to enter into arrangements with, and retain a sufficient number of, high quality distribution partners in each of the regions in which we will sell products and keep them motivated to sell our products, our ability to sell our products and operating results will be harmed. The termination of our relationship with any significant distribution partner may also adversely impact our sales and operating results.
+Increases in component costs, long lead times, supply shortages, and supply changes could disrupt our supply chain and have an adverse effect on our business, financial condition, and operating results.
+We acquire certain of our materials, which are critical to the ongoing operation and future growth of our business, from several third parties, both foreign and domestic. Generally, our third-party contract manufacturers contract directly with component suppliers, and we rely on our contract manufacturers to manage their supply chains. If our contract manufacturers experience any supply chain disruptions or our relationships with our contract manufacturers terminate, we could experience delays, which could negatively impact our business, customer relationships, and margins. We also source some materials and components directly from suppliers. While most components and materials for our products are available from multiple suppliers, certain of those items are only available from limited or sole sources. Should any of these suppliers become unavailable or inadequate, or impose terms unacceptable to us, such as increased pricing terms, we could be required to spend a significant amount of time and expense to develop alternate sources of supply, and may not be successful in doing so on terms acceptable to it, or at all. As a result, the loss of a limited or sole source supplier could adversely affect our manufacturing capacity, and relationships with our customers, as well as our results of operations and financial condition.
+We depend on a third-party contract manufacturer for the production of several key components in our products. While there are several potential manufacturers for most of these components, replacement of key manufacturers of our sources and detectors may require substantial design considerations to effect. We are seeking to expand and diversify our contract manufacturer relationships, our current reliance on one contract manufacturer involves several risks, including:
+ unexpected increases in manufacturing and repair costs;
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+ inability to control the quality and reliability of finished products;
+ inability to control delivery schedules;
+ potential liability for expenses incurred by the third-party contract manufacturer in reliance on our forecasts that later prove to be inaccurate;
+ potential lack of adequate capacity to manufacture all of part of the products we require;
+ the occurrence of unforeseen force majeure events; and
+ potential labor unrest or unavailability affecting the ability of the third-party manufacturers to produce our products.
+
+If our third-party contract manufacturers experience a delay, disruption, or quality control problems in their operations or if the third-party contract manufacturers do not renew or terminate our agreement with them, our operations could be significantly disrupted and our product shipments could be delayed. Qualifying new manufacturers and commencing volume production is expensive and time consuming. Ensuring that a contract manufacturer is qualified to manufacture our products or components to our standards is time consuming. In addition, there is no assurance that contract manufacturers can scale their production of our products or components at the volumes and in the quality that we require. If contract manufacturers are unable to do these things, we may have to move production for the products or components to a new or existing third-party manufacturer, which would take significant effort and our business, results of operations and financial condition could be materially adversely affected.
+As we contemplate moving manufacturing into different jurisdictions, we may be subject to additional and significant challenges in ensuring that quality, processes, and costs, among other issues, are consistent with our expectations. For example, while we expect our third-party contract manufacturers to be responsible for penalties assessed on us because of excessive failures or warranty claims, there is no assurance that we will be able to collect such reimbursements from these manufacturers, which creates additional risk of liability for potential failures of our products.
+In addition, increases in the prices charged by third-party contract manufacturers may have an adverse effect on our results of operations, as we may be unable to find a contract manufacturer who can supply us at a lower price. As a result, the loss of a limited or sole source supplier could adversely affect our relationships with our customers and our results of operations and financial condition.
+Changes in trade policies, including the imposition of tariffs, could negatively impact our business, financial condition, and results of operations.
+Our business is dependent upon the availability of raw materials and components for assembly. United States relations with the rest of the world remains uncertain with respect to taxes, trade policies, and tariffs, especially as the political landscape changes due to the recent U.S. presidential and congressional elections. Changes in U.S. administrative policy may lead to significant increases in tariffs for imported goods among other possible changes, and the current administration has indicated that it is likely to impose significant tariffs on imported goods. The imposition of such tariffs may strain international trade relations and increase the risk that foreign governments implement retaliatory tariffs on goods imported from the U.S. These political and economic changes could have a material effect on global economic conditions and the stability of financial markets and could significantly reduce global trade. The imposition and continuation of tariffs and other potential changes in U.S. trade policy could increase the cost and/or limit the availability of raw materials, which could hurt our competitive position and adversely impact our business, financial condition, and results of operations. Additionally, challenging current and future global economic conditions, including inflation and supply chain disruptions may negatively impact our business operations and financial results.
+We incorporate technology and components from third parties into our products, and our inability to obtain or maintain rights to the technology could harm our business.
+We incorporate technology and components from third parties into our products. We cannot be certain that our suppliers and licensors are not infringing the intellectual property rights of third parties or that the suppliers and licensors have sufficient rights to the technology in all jurisdictions in which it may sell our products. We may not be able to rely on indemnification obligations of third parties if some of our agreements with our suppliers may be terminated for convenience by them. If we are unable to obtain or maintain rights to any of this technology because of intellectual property infringement claims brought by third parties against our suppliers and licensors or against us, or if we are unable to continue to obtain such technology or enter into new agreements on 
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+commercially reasonable terms, our ability to develop and sell products services containing such technology could be severely limited, and our business could be harmed. Disputes with suppliers and licensors over uses or terms could result in the payment of penalties by us, cancellation or non-renewal of the underlying license or litigation. In the event that we cannot renew and/or expand existing licenses, we may be required to discontinue or limit our use of the operations, products, or offerings that include or incorporate the licensed intellectual property. Any such discontinuation or limitation could have a material and adverse impact on our business, financial condition, and results of operation. Additionally, if we are unable to obtain necessary technology and components from third parties, including certain sole suppliers, we may be forced to acquire or develop alternative technology or components, which may require significant time, cost and effort and may be of lower quality or performance standards. This would limit or delay our ability to offer new or competitive products and increase our costs of production. If alternative technology or components cannot be obtained or developed, we may not be able to offer certain functionality as part of our products,. As a result, our margins, market share and results of operations could be significantly harmed.
+The U.S. federal government has march-in rights under our Cooperative Research and Development Agreement ( CRADA ) with the Department of Homeland Security.
+We have entered into a CRADA with the Department of Homeland Security. The United States federal government retains certain rights in inventions produced with its financial assistance under the Patent and Trademark Law Amendments Act, or Bayh-Dole Act, including a nonexclusive, nontransferable, irrevocable, paid-up license for its own benefit. The Bayh-Dole Act also provides federal agencies with march-in rights. March-in rights allow the government, in specified circumstances, to require the contractor or successors in title to the patent to grant a nonexclusive, partially exclusive, or exclusive license to a responsible applicant or applicants. If the patent owner refuses to do so, the government may grant the license itself.
+In addition, the United States government requires that any products embodying the subject invention or produced through the use of the subject invention be manufactured substantially in the United States. The manufacturing preference requirement can be waived if the owner of the intellectual property can show that reasonable but unsuccessful efforts have been made to grant licenses on similar terms to potential licensees that would be likely to manufacture substantially in the United States or that under the circumstances domestic manufacture is not commercially feasible. This preference for United States manufacturers may limit our ability to contract with non-United States product manufacturers for products covered by such intellectual property. Any exercise by the government of any of the foregoing rights could harm our competitive position, business, financial condition, results of operations and prospects.
+Our use of open source software could subject our proprietary software to general release, negatively affect our ability to offer our products and subject us to possible litigation.
+We have used open source software in connection with the development and deployment of our software products, and we expect to continue to use open source software in the future. Open source software is licensed by its authors or other third parties under open source licenses, which in some instances may subject us to certain unfavorable conditions, including requirements that we offer our products that incorporate the open source software for no cost, that we make publicly available all or part of the source code for any modifications or derivative works we create based upon, incorporating or using the open source software, or that we license such modifications or derivative works under the terms of the particular open source license.
+Companies that incorporate open source software into their products have, from time to time, faced claims challenging the use of open source software and compliance with open source license terms. As a result, we could be subject to suits by parties claiming ownership of what we believe to be open source software or claiming noncompliance with open source licensing terms. While we monitor our use of open source software and try to ensure that none is used in a manner that would require us to disclose our proprietary source code or that would otherwise breach the terms of an open source agreement, we cannot guarantee that we will be successful, that all open source software is reviewed prior to use in our products, that our developers have not incorporated open source software into our products that we are unaware of or that they will not do so in the future.
+Furthermore, there are an increasing number of open source software license types, almost none of which have been interpreted by U.S. or foreign courts, resulting in a dearth of guidance regarding the proper legal interpretation of such licenses. As a result, there is a risk that open source software licenses could be construed in a manner that imposes unanticipated conditions or restrictions on our ability to market or provide our products. If we are held to have breached or failed to fully comply with all the terms and conditions of an open source software license, we could face infringement claims or other liability, or be required to seek costly licenses from third parties to continue providing our offerings on terms that are not economically feasible, if at all, to re-engineer all or a portion of our products, to discontinue or delay the provision of our offerings if re-engineering could not be accomplished on a timely basis or to make generally available, in source code form, our proprietary code. Further, in addition to risks related to license requirements, use of 
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+certain open source software carries greater technical and legal risks than does the use of third-party commercial software. For example, open source software is generally provided without any support or warranties or other contractual protections regarding infringement or the quality of the code, including the existence of security vulnerabilities. To the extent that our products depends upon the successful operation of open source software, any undetected errors or defects in open source software that we use could prevent the deployment or impair the functionality of our systems and injure our reputation. In addition, the public availability of such software may make it easier for others to compromise our products. Any of the foregoing risks could materially and adversely affect our business, financial condition and results of operations.
+Risks Related to Intellectual Property
+Our intellectual property rights are valuable and any inability to protect our proprietary technology and intellectual property rights could substantially harm our business and operating results.
+Our future success and competitive position depend in part on our ability to protect our intellectual property and proprietary technologies. To safeguard these rights, we rely on a combination of patent, trademark, copyright and trade secret laws and contractual protections in the United States and other jurisdictions, all of which provide only limited protection and may not now or in the future provide us with a competitive advantage. We maintain a program of identifying technology appropriate for patent protection. Our practice is to require employees and consultants to execute non-disclosure and proprietary rights agreements upon commencement of employment or consulting arrangements. These agreements acknowledge our exclusive ownership of all intellectual property developed by the individuals during their work for us and require that all proprietary information disclosed will remain confidential. Such agreements may not be enforceable in full or in part in all jurisdictions and any breach could have a negative effect on our business and our remedy for such breach may be limited.
+It cannot be certain that any patents will issue from any patent applications that we may file, that patents that issue from such applications will give us the protection that we seek or that any such patents will not be challenged, invalidated, or circumvented. Any patents that may issue in the future from our pending or future patent applications may not provide sufficiently broad protection and may not be enforceable in actions against alleged infringers. We cannot be certain that any future trademark registrations will be issued for pending or future applications or that any registered
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diff --git a/parsed_sections/prospectus_summary/2025/STUB_stubhub_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/STUB_stubhub_prospectus_summary.txt
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/SUIG_sui-group_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/SUIG_sui-group_prospectus_summary.txt
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/SVACW_spring_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/SVACW_spring_prospectus_summary.txt
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@@ -0,0 +1 @@
+Prospectus Summary Dilution and Dilution for more information. As of May 21, 2025 Offering Price of 25% of Maximum 50% of Maximum 75% of Maximum $10.00 per Unit Redemption Redemption Redemption Maximum Redemption Difference Difference Difference Difference between between between between Public NTBV NTBV and NTBV and NTBV and and Public Offering Offering Offering NTBV NTBV Offering Price NTBV Price NTBV Price NTBV Price Assuming Full Exercise of Over-Allotment Option $7.23 $ 6.69 $ 3.31 $ 5.81 $ 4.19 $ 4.19 $ 5.81 $ 0.14 $ 9.86 Assuming No Exercise of Over-Allotment Option $7.23 $ 6.68 $ 3.32 $ 5.81 $ 4.19 $ 4.19 $ 5.81 $ 0.13 $ 9.87 Our Sponsor and members of our management team will directly or indirectly own our securities following this offering, and accordingly, they may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Additionally, each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. See the section titled Management Conflicts of Interest. Prior to this offering, there has been no public market for our units, Class A ordinary shares or public warrants. We have applied to list our units on The Nasdaq Global Market ( Nasdaq ) under the symbol SVACU on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on Nasdaq. The closing of this offering is contingent upon the successful listing of our common stock on Nasdaq. The Class A ordinary shares and public warrants constituting the units will begin separate trading on the 52nd day following the date of this prospectus (or, if such date is not a business day, the following business day) unless Cohen and Company Capital Markets, a division of Cohen & Company Securities, LLC ( CCM ) and Clear Street LLC ( Clear Street ), the representatives of the underwriters, inform us of its decision to allow earlier separate trading, subject to our satisfaction of certain conditions as described further herein. Once the securities constituting the units begin separate trading, we expect that the Class A ordinary shares and warrants will be listed on Nasdaq under the symbols SVAC and SVACW, respectively. Table of Contents We are responsible for the information contained in this prospectus. We have not authorized anyone to provide any information or to make any representations other than those contained in this prospectus. We and the underwriters take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus is an offer to sell only the units offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date. Lead Book-Running Manager Cohen & Company Capital Markets Joint Book-Runner Clear Street The date of this prospectus is , 2025 Table of Contents TABLE OF CONTENTS Page SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/TCGL_techcreate_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/TCGL_techcreate_prospectus_summary.txt
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@@ -0,0 +1 @@
+Prospectus Summary 1
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diff --git a/parsed_sections/prospectus_summary/2025/TCRT_alaunos_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/TCRT_alaunos_prospectus_summary.txt
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+PROSPECTUS SUMMARY This summary highlights certain information about us, this offering, and information contained elsewhere in this prospectus and in the documents we incorporate by reference. This summary is not complete and does not contain all of the information that you should consider before making an investment decision. To fully understand this offering and its consequences to you, you should read this entire prospectus carefully, including the factors described under the heading Risk Factors in this prospectus beginning on page 18, in our Annual Report on Form 10-K filed on March 31, 2025, as amended on April 30, 2025, our Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and the financial statements and all other information incorporated by reference in this prospectus. When used in this prospectus, except where the context otherwise requires, the terms the Company, we, us, our, Alaunos, or similar terms refer to Alaunos Therapeutics, Inc. Company Overview On October 10, 2024, we announced our continued progress and evaluation of our internally developed small molecule oral obesity program. The aim of this program is to develop a drug for obesity with a differentiated profile relative to currently marketed and in development oral and injectable products. We have also operated as a clinical-stage oncology-focused cell therapy company developing adoptive TCR-T cell therapy, designed to treat multiple solid tumor types in large cancer patient populations with unmet clinical needs. On August 14, 2023, we announced a strategic reprioritization of our business and wind down of our TCR-T Library Phase 1/2 Trial. In connection with the reprioritization, we reduced our workforce during the third and fourth quarters of 2023, and we continue working to reduce costs in order to extend our cash runway. We continue to explore strategic alternatives, including, but not limited to, an acquisition, merger, reverse merger, sale of assets, strategic partnerships, capital raises or other transactions. We have not generated any product revenue and have incurred significant net losses in each year since our inception. For the six months ended June 30, 2025, we had a net loss of $2.1 million, and as of June 30, 2025, we have incurred approximately $922.6 million of accumulated deficit since our inception in 2003. We expect to continue to incur significant operating expenditures and net losses for the foreseeable future. Small Molecule Oral Obesity Program We are advancing our internally developed, preclinical small molecule program for the treatment of obesity and related metabolic disorders. This program focuses on discovering and developing novel, orally administered therapeutics with the potential for a differentiated and complementary profile compared to currently available therapies. While other pipeline therapies for obesity explore alternative hormonal pathways such as amylin or dual GIP/GLP-1 receptor agonism, our approach is focused on a non-hormonal mechanism of action. The program seeks to develop an oral therapeutic with the potential to address certain limitations of existing hormonal therapies, including the potential for preservation of lean muscle mass during weight loss and an improved tolerability profile. During the fourth quarter of 2024, we engaged a contract development and manufacturing organization (CDMO) to synthesize active pharmaceutical ingredients (APIs) for our product candidates. We have since initiated a portfolio of preclinical studies to evaluate these product candidates. Initial in vitro characterization studies conducted by a contract research organization (CRO) encountered methodological issues related to the assay, which prevented the generation of conclusive data. This CRO has since completed the necessary method development to resolve these issues, and these studies are being repeated. In parallel, we have conducted an in vivo pharmacokinetic (PK) study of our product candidate ALN1003 and have initiated a pilot in vivo proof-of-concept (PoC) study of ALN1003 in a diet-induced obesity (DIO) mouse model. Table of Contents Collectively, these ongoing studies are designed to assess our candidates effects on key biological pathways implicated in metabolic disease, including receptor binding, lipid accumulation, food consumption, weight loss, and the expression of genes related to thermogenesis and energy expenditure. We anticipate initial data from these ongoing in vitro and in vivo studies will be available no later than the fourth quarter of 2025. These data are intended to inform the future development strategy for our product candidates and guide indication selection. The advancement of this program is subject to numerous risks and uncertainties inherent in early-stage drug development. Subject to favorable data from these preclinical studies and our ability to secure additional capital, we plan to advance a selected development candidate into formal investigational new drug (IND)-enabling studies. We intend to actively explore strategic financing and collaboration opportunities to fund the continued development of this program. Obesity Market Obesity remains one of the most pressing public health challenges globally, with rates continuing to rise across many regions, particularly in the United States, Europe, and parts of Asia. It is closely linked to a range of comorbid conditions, including type 2 diabetes, cardiovascular diseases, and certain cancers, which exacerbates the overall healthcare burden. The obesity market is seeing increased attention, driven by growing awareness, better treatment options, and emerging scientific breakthroughs. The global obesity market is experiencing rapid growth. Globally, the market size for branded obesity drugs was $6 billion in 2023 and is estimated that it will reach $105.0 billion by 2030. This growth is fueled by the rising obesity prevalence, evolving patient demographics, and increasing demand for effective weight-management solutions. The shift toward more personalized treatments and the need for long-term weight management are key drivers of this growth. The current treatment landscape for obesity consists of a combination of lifestyle interventions, pharmaceuticals, and surgical options. Lifestyle interventions dietary changes and physical activity are the first-line treatment for most individuals, but many struggle to achieve and maintain significant weight loss through these methods alone. Traditional weight-loss medications (e.g., OrlistatTM) are still used, though their side effects and modest results have limited their appeal. Newer drugs, like GLP-1 receptor agonists (e.g., OzempicTM, WegovyTM), are quickly becoming the gold standard in the market. These drugs, which mimic the action of gut hormones to promote satiety and reduce appetite, have shown remarkable efficacy in clinical trials and are significantly improving patient outcomes. The success of GLP-1s has led to a surge in interest from both pharmaceutical companies and patients. However, issues such as high cost, insurance reimbursement, and potential long-term side effects remain areas of concern. The future of the obesity market is promising, with new therapies, enhanced patient targeting, and continued scientific breakthroughs on the horizon. As the global obesity epidemic continues to grow, demand for more effective and affordable treatments will likely continue to rise. However, success will depend on overcoming challenges related to cost, access, and patient adherence. Advancements in personalized medicine, non-invasive treatments, and innovative drug mechanisms will shape the next phase of the obesity treatment landscape. The obesity market today is vibrant and expanding, but still in need of accessible, scalable, and sustainable solutions to effectively manage this complex and widespread health issue. Table of Contents Historical Development and Achievements in Cancer Therapeutics We previously focused on developing TCR-T cell therapies for solid tumors using our non-viral Sleeping Beauty platform and hunTR TCR discovery platform. Key milestones included: TCR-T Library Phase 1/2 Trial (2022-2023): Treated eight patients with solid tumors (e.g., pancreatic, colorectal, lung). The trial showed TCR-T cells were well-tolerated, with no dose-limiting toxicities or neurotoxicity. Cytokine release syndrome (grades 1-3) resolved with standard care. One non-small cell lung cancer patient achieved a partial response (13% response rate), and six others had stable disease (87% disease control rate), establishing proof-of-concept that Sleeping Beauty TCR-T cells can result in objective clinical responses an recognize established tumors in vivo. hunTR Platform: Identified proprietary TCRs targeting driver mutations (KRAS, TP53, others) and various HLAs, expanding the TCR library for potential patient treatment. In August 2023, however, due to substantial development costs and a challenging financing environment, we announced a strategic reprioritization, including the wind-down of our TCR-T Library Phase 1/2 Trial and cessation of further clinical development of TCR-T programs. This involved: Workforce reductions (approximately 95% by the end of 2023) and cost-cutting measures to extend cash runway. Termination of key licenses and agreements: NCI patent license (effective December 26, 2023), after internally developing proprietary TCRs via hunTR targeting similar mutations. NCI CRADA (effective October 13, 2023). Precigen exclusive license (fully terminated October 4, 2024, following an amendment in April 2023 that eliminated royalty/milestone obligations). Trial close-out activities, including internal processes, with ongoing costs for long-term follow-up and regulatory obligations. As a result, research and development expenses related to cancer programs have significantly declined, from $11.7 million for the six months ended June 30, 2023, to $0.3 million for the same period in 2025, reflecting the shift away from active oncology development. We are actively exploring strategic alternatives to maximize stockholder value, including but not limited to acquisitions, mergers, reverse mergers, asset sales, strategic partnerships, or capital raises. These may involve monetizing cancer-related assets, such as out-licensing the TCR library or hunTR platform. We have engaged Cantor Fitzgerald & Co. as a strategic advisor for this process. However, there are no assurances that any transaction will be consummated, and failure to do so could lead to further operational curtailment or dissolution. Our primary focus has shifted to our preclinical small-molecule obesity and metabolic disorder program, with ongoing preclinical in vitro and in vivo studies. Selected Risks Related to our Business Our business is subject to numerous risks, including risks that may prevent us from achieving our business objectives or may adversely affect our business, financial condition, results of operations, cash flows and prospects that you should consider before making an investment decision. Some of the more significant risks and uncertainties relating to an investment in our company are listed below. These risks are more fully described in the section titled Risk Factors in this prospectus and in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024, and in Part II, Item 1A of our Quarterly Reports on Form 10-Q for the fiscal quarters ended March 31, 2025 and June 30, 2025, which are incorporated by reference into this prospectus. Table of Contents Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also impair our business operations. You should be able to bear a complete loss of your investment. Our strategic reprioritization may not be successful, may not yield the desired results and we may be unsuccessful in identifying and implementing any strategic transaction. If a strategic transaction is not consummated, our board of directors ( Board ) may decide to pursue a dissolution and liquidation. In such an event, the amount of cash available for distribution to our stockholders will depend heavily on the timing of such liquidation as well as the amount of cash that will need to be reserved for commitments and contingent liabilities. We may require substantial additional financial resources to continue as a going concern, including through the strategic review process, and if we raise additional funds it may affect the value of your investment in our common stock. Our ability to consummate a strategic transaction depends on our ability to retain our current employees and consultants. Our stock price has been, and may continue to be, volatile. Our decreasing cash reserves had resulted in our shareholder equity falling below $2,500,000 as required by Nasdaq Listing Rule 5550(b)(1), which resulted in our receipt of a delisting notice from Nasdaq in April of 2025. While we have reestablished compliance with the listing rule based on our Quarterly Report on Form 10-Q for the period ended June 30, 2025, evidencing stockholders equity of $3.66 million, we remain at risk of future non-compliance if our cash reserves continue to decline or if we face unexpected financial challenges, which could lead to further delisting actions by Nasdaq. We have identified a material weakness and failed to maintain an effective internal control environment, which may result in material misstatements of our financial statements or have a material adverse effect on our business or stock price. Our small molecule obesity program is early stage and may encounter issues with manufacturing of the active pharmaceutical ingredient(s) or with the in vitro or in vivo studies that could preclude clinical trials or be costly to address with respect to time or money. For our small molecule oral obesity program or should we resume development of our TCR-T product candidates, any candidate for which we obtain marketing approval could be subject to post-marketing restrictions or withdrawal from the market and we may be subject to significant penalties if we fail to comply with regulatory requirements or if we experience unanticipated problems with our products, when and if any of them are approved. For our small molecule oral obesity program, or should we resume development of our TCR-T product candidates, if we fail to obtain the necessary U.S. or worldwide regulatory approvals to commercialize any product candidate, our business will suffer materially. We may not be able to commercialize, generate significant revenues from, or attain profitability from our small molecule oral obesity program or, should we resume development of, our TCR-T product candidates. The termination of our TCR-T related licenses and research and development agreements could limit our ability to resume our TCR-T clinical trial or begin new clinical trials. We may become involved in litigation, including securities class action litigation, that could divert management s attention and harm our business, and insurance coverage may not be sufficient to cover all costs and damages. Our product candidates may cause undesirable side effects or have other properties that could delay or prevent their regulatory approval, limit the commercial profile of an approved label or result in significant negative consequences following any potential marketing approval. Table of Contents The gene transfer vectors from the Sleeping Beauty system used to manufacture our TCR-T product candidates may incorrectly modify the genetic material of a patient s T cells, potentially triggering the development of a new cancer or other adverse events. If we are unable either to create sales, marketing and distribution capabilities or enter into agreements with third parties to perform these functions, we will be unable to commercialize our product candidates successfully. If physicians and patients do not accept and use our product candidates, once approved, or if we do not obtain coverage and adequate reimbursement from payors, our ability to generate revenue from sales of our products will be materially and adversely impaired. Our small molecule and immuno-oncology product candidates may face competition in the future from generics or biosimilars and/or new technologies and our pending patent applications may not be granted, further limiting our ability to compete with other companies. If we fail to adequately protect or enforce our intellectual property rights or secure rights to patents of others, the value of our intellectual property rights would diminish and our ability to successfully commercialize our products may be materially impaired. Third-party claims of intellectual property infringement would require us to spend significant time and money and could prevent us from developing or commercializing our products. We have and will rely significantly on information technology and any failure, inadequacy, interruption or security lapse of that technology or loss of data, including any cybersecurity incidents, could compromise sensitive information related to our business, prevent us from accessing critical information or expose us to liability which could harm our ability to operate our business effectively and materially and adversely affect our business and reputation. Anti-takeover provisions in our charter documents and under Delaware law may make an acquisition of us, which may be beneficial to our stockholders, more difficult. Our amended and restated bylaws provide that the Court of Chancery of the State of Delaware will be the exclusive forum for substantially all disputes between us and our stockholders, which could limit our stockholders ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees. Because we do not expect to pay dividends, you will not realize any income from an investment in our common stock unless and until you sell your shares at a profit. Our ability to use net operating loss carryforwards and research tax credits to reduce future tax payments may be limited or restricted. The exercise of outstanding warrants, and issuance of equity awards may have a dilutive effect on our stock, and negatively and materially impact the price of our common stock. Our principal stockholders, executive officers and directors have substantial control over the Company, which may prevent you and other stockholders from influencing significant corporate decisions and may significantly harm the market price of our common stock. We are a smaller reporting company, and the reduced disclosure requirements applicable to smaller reporting companies may make our common stock less attractive to investors. other risks described from time to time in periodic and current reports that we file with the SEC. The Mast Hill Transaction On May 19, 2025, we entered into an equity purchase agreement (the Purchase Agreement ) and a registration rights agreement (the Registration Rights Agreement ) with Mast Hill Fund, L.P., a Delaware limited Table of Contents partnership ( Mast Hill ). Pursuant to the Purchase Agreement, Mast Hill has committed to purchase up to $25,000,000 of the Company s newly issued shares common stock, par value $0.001 per share (the common stock ), from time to time during the term of the Purchase Agreement, subject to certain limitations and conditions (the Mast Hill Offering ). The Purchase Agreement initially precludes us from issuing and selling more than 327,740 shares of our common stock, including the Warrant Shares, which number equals 19.99% of our common stock issued and outstanding as of May 18, 2025, unless we obtain stockholder approval to issue additional shares, or unless certain exceptions apply. One such exception applies where the average price paid for all shares of common stock issued under the Purchase Agreement (including both Purchase Shares and the Warrant Shares) is equal to or greater than $2.40, which is a price equal to the lower of (i) the Nasdaq Official Closing Price immediately preceding the execution of the Purchase Agreement and (ii) the average Nasdaq Official Closing Price of our common stock for the five trading days immediately preceding the execution of the Purchase Agreement, as calculated in accordance with the rules of Nasdaq, such that the sales of such common stock to the Selling Stockholder would not count toward such limit because they are at market under applicable stock exchange rules. In addition, a beneficial ownership limitation in the agreement initially limits us from directing Mast Hill to purchase shares of common stock if such purchases would result in Mast Hill beneficially owning more than 4.99% of the then-outstanding shares of our common stock. Upon the terms and subject to the satisfaction of the conditions set forth in the Purchase Agreement, the Company has the right, but not the obligation, to sell to Mast Hill, and Mast Hill is obligated to purchase, up to $25,000,000 of common stock, at a purchase price per share equal to the lesser of (i) 97% of the lowest VWAP of the Company s common stock, as listed on Nasdaq, on any trading day during the period beginning on the put date and continuing through the date that is two trading days immediately following the clearing date associated with the applicable put notice (such two trading day period is the Valuation Period ), or (ii) 102% of the lowest traded price of the Company s common stock, as listed on Nasdaq, on any trading day during the Valuation Period, on such date on which the purchase price is calculated in accordance with the terms of the Purchase Agreement. Such sales of common stock by the Company, if any, are subject to certain limitations set forth in the Purchase Agreement, and may occur from time to time, at the Company s sole discretion, over a period of up to 24-months, commencing on the date of the Purchase Agreement, including the effectiveness of a registration statement registering under the Securities Act, the resale by Mast Hill of shares of common stock that may be issued by the Company to Mast Hill under the Purchase Agreement and upon the exercise of the Warrant (as defined below). The Company has agreed to file such registration statement with the Securities and Exchange Commission within 60 days from the date of execution of the Purchase Agreement and the Registration Rights Agreement. We will control the timing and amount of any such sales of common stock to Mast Hill. Actual sales of shares of common stock to Mast Hill will depend on a variety of factors to be determined by us from time to time, including, among other things, market conditions, the trading price of our common stock, and determinations by us as to the appropriate sources of funding for the Company and our operations. We have the right to terminate the Purchase Agreement at any time after its commencement, at no cost or penalty, upon prior written notice to Mast Hill, except during any Valuation Period or at any time that Mast Hill holds any shares of common stock purchased by Mast Hill under the Purchase Agreement. As consideration for Mast Hill s commitment to purchase shares of common stock in accordance with the Purchase Agreement, the Company has issued to Mast Hill a warrant to purchase 79,900 shares of common stock (as amended, the Warrant ) concurrently with the execution of the Purchase Agreement. The Warrant is immediately exercisable and will expire on the fifth anniversary of the original issuance date. The Warrant has an initial exercise price per share of $4.00. The exercise price and number of shares of common stock issuable upon exercise is subject to appropriate adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting the common stock and anti-dilution adjustments. On June 9, 2025, the Company entered into an Amendment No. 1 to the common stock Purchase Warrant Issued on May 19, 2025 (the Warrant Amendment ) with Mast Hill. The Warrant Amendment (i) added a floor price Table of Contents equal to $0.57 per share, with respect to certain adjustment to the exercise price of the Warrant in the event of any Dilutive Issuance (as defined in the Warrant), issuance of Variable Price (as defined in the Warrant) securities and certain other events set forth in Section 2(e) of the Warrant; (ii) removed the requirement to adjust the number of shares of common stock issuable upon exercise of the Warrant in the event of a Dilutive Issuance, a Variable Price adjustment or under Section 2(e) of the Warrant; and (iii) removed certain rights of the Warrant holder in connection with fundamental transactions. We intend to use the net proceeds, if any, from the Mast Hill Offering for working capital and general corporate purposes, including sales and marketing activities, product development and capital expenditures. We may also use a portion of the net proceeds to acquire or invest in complementary businesses, products and technologies. The Purchase Agreement and the Registration Rights Agreement contain customary representations, warranties, conditions and indemnification obligations of the parties. Corporate Information We originally incorporated in Colorado in September 1998 (under the name Net Escapes, Inc.) and later changed our name to EasyWeb, Inc. in February 1999. We re-incorporated in Delaware on May 16, 2005 under the same name. On September 13, 2005, we completed a reverse acquisition of privately held Ziopharm, Inc., a Delaware corporation. To effect this transaction, we caused ZIO Acquisition Corp., our wholly-owned subsidiary, to merge with and into Ziopharm, Inc., with Ziopharm, Inc. surviving as our wholly owned subsidiary. Following the merger, we caused Ziopharm, Inc. to merge with and into us and we changed our name to Ziopharm Oncology, Inc. As a result, Ziopharm, Inc. became the registrant with the Securities and Exchange Commission, or the SEC, and the historical financial statements of Ziopharm, Inc. became our historical financial statements. On January 25, 2022, we filed a Certificate of Amendment to our Amended and Restated Certificate of Incorporation with the Delaware Secretary of State to change our name to Alaunos Therapeutics, Inc. Our principal executive offices are located at 501 E. Las Olas Blvd., Suite 300, Fort Lauderdale, FL 33301, and our telephone number is (346) 355-4099. Our corporate website address is www.alaunos.com. We make available on or through our website our periodic reports that we file with the SEC. Information contained in, or accessible through, our website is not a part of this prospectus, and the inclusion of our website address in this prospectus is an inactive textual reference only. The contents of our website are not incorporated by reference into this document and shall not be deemed filed under the Securities Exchange Act of 1934, as amended (the Exchange Act ). Table of Contents THE OFFERING The following summary contains basic information about this offering. The summary is not intended to be complete. You should read the full text and more specific details contained elsewhere in this prospectus. Shares of common stock offering by the Selling Stockholder 327,740 shares of our common stock, par value $0.001 per share, which includes (1) up to 247,840 Purchase Shares that may be issued to Mast Hill from time to time pursuant to the Purchase Agreement, and (2) up to 79,900 Warrant Shares, upon the exercise of the Warrant issued to Mast Hill under the Purchase Agreement. Shares of common stock outstanding immediately prior to this offering 2,321,829 shares (as of October 20, 2025) Terms of the offering The Selling Stockholder will determine when and how it will dispose of any shares of our common stock that are registered under this prospectus for resale. See Plan of Distribution. Use of proceeds We will not receive any of the proceeds from the sale of shares of our common stock offered by the Selling Stockholder. However, we may receive up to an aggregate of $25 million in proceeds from the sale of our common stock to the Selling Stockholder pursuant to the Purchase Agreement and up to $319,600 in proceeds if the Selling Stockholder exercises the Common Stock Purchase Warrant at $4.00 per share. However, the actual proceeds may be less than this amount depending on the number of shares of our common stock sold and the price at which the shares of our common stock are sold. We intend to use any net proceeds that we receive under the Purchase Agreement for working capital and other general corporate purposes. However, as of the date of this prospectus, we cannot specify with certainty all of the particular uses, and the respective amounts we may allocate to those uses, for any net proceeds we receive. See Use of Proceeds.
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+Prospectus Summary," "Risk Factors,"
+"Use of Proceeds," "Management s Discussion and Analysis of Financial Condition and Results of Operations,"
+and "Business." These statements relate to events that involve known and unknown risks, uncertainties and other factors,
+including those listed under "Risk Factors," which may cause our actual results, performance or achievements to be
+materially different from any future results, performance or achievements expressed or implied by the forward-looking statements.
+
+ 
+
+In
+some cases, these forward-looking statements can be identified by words or phrases such as "believe," "plan,"
+"expect," "intend," "should," "seek," "estimate," "will," "aim"
+and "anticipate" or other similar expressions, but these are not the exclusive means of identifying such statements. All
+statements other than statements of historical facts included in this document, including those regarding future financial position and
+results, business strategy, plans and objectives of management for future operations (including development plans and dividends) and
+statements on future industry growth are forward-looking statements. In addition, we and our representatives may from time to time make
+other oral or written statements which are forward-looking statements, including in our periodic reports that we will file with the SEC,
+other information sent to our shareholders and other written materials.
+
+ 
+
+These
+forward-looking statements are subject to risks, uncertainties and assumptions, certain of which are beyond our control. In addition,
+these forward-looking statements reflect our current views with respect to future events and are not a guarantee of future performance.
+Actual outcomes may differ materially from the information contained in the forward-looking statements as a result of a number of factors,
+including, without limitation, the risk factors set forth in "Risk Factors" and the following:
+
+ 
+
+ 
+ 
+ our
+ business and operating strategies and our various measures to implement such strategies;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ operations and business prospects, including development and capital expenditure plans for our existing business;
+
+ 
+ 
+ 
+
+ 
+ 
+ changes
+ in policies, legislation, regulations or practices in the industry and place in which we operate that may affect our business operations;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ financial condition, results of operations and dividend policy;
+
+ 
+ 
+ 
+
+ 
+ 
+ changes
+ in political and economic conditions and competition in the events management and related industry;
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ regulatory environment and industry outlook in general;
+
+ 
+ 
+
+ 
+ 
+ catastrophic
+ losses from man-made or natural disasters, such as fires, floods, windstorms, earthquakes, diseases, epidemics, other adverse weather
+ conditions or natural disasters, war, international or domestic terrorism, civil disturbances and other political or social occurrences;
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ loss of key personnel and the inability to replace such personnel on a timely basis or on terms acceptable to us;
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ overall economic environment and general market and economic conditions in Hong Kong;
+
+ 
+ 
+ 
+
+ 
+ 
+ changes
+ in the need for capital and the availability of financing and capital to fund those needs;
+
+ 
+ 
+ 
+
+ 
+ 
+ our
+ ability to anticipate and respond to changes in consumer performances, tastes and trends; and
+
+ 
+ 
+ 
+
+ 
+ 
+ legal,
+ regulatory and other proceedings arising out of our operations.
+
+ 
+ 
+
+The
+forward-looking statements made in this prospectus relate only to events or information as of the date on which the statements are made
+in this prospectus. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements,
+whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the
+occurrence of unanticipated events. You should read this prospectus and the documents that we reference in this prospectus and have filed
+as exhibits to the Registration Statement, of which this prospectus is a part, completely and with the understanding that our actual
+future results or performance may be materially different from what we expect.
+
+ 
+
+ -2-
+
+ 
+
+ 
+
+ 
+
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that may be
+important to you, and we urge you to read this entire prospectus carefully, including the "Risk Factors," "Business"
+and "Management s Discussion and Analysis of Financial Condition and Results of Operations" sections and our consolidated
+financial statements and notes to those statements, included elsewhere in this prospectus, before deciding to invest in our Class A Ordinary Shares. This prospectus includes forward-looking statements that involve risks and uncertainties. See "Special Note Regarding
+Forward-Looking Statements."
+
+ 
+
+Overview
+
+ 
+
+We
+are an event management service provider based in Hong Kong with over eight years of experience in managing the entire or part of the
+event lifecycle for our customers. Events encompass a range of public and private events, from trade shows, conferences, concerts, exhibitions,
+charity galas, brand promotion events to internal corporate events. For enterprises, events offer a highly effective way to maximize
+their engagement with customers, helping enterprises to generate and qualify leads, deepen relationships with customers and build brand
+loyalty and advocacy, such as promotion of a brand by satisfied customers through customers sharing positive experiences on social media,
+providing referrals to friends and family, or simply telling others about the brand.
+
+ 
+
+We
+specialize in assisting event organizers in organizing, planning, promoting and managing themed touring walk-through experience events,
+or experience events, for intellectual property owners, or IP owners, of characters in well-publicized animated cartoons and/or live
+action theatrical motion pictures, each a licensed character. This type of experience events typically involve an intellectual property
+license, or IP license, from the IP owner to an event organizer, giving the event organizer the right to develop, organize, plan, promote
+and manage experience events relating to the licensed character and other licensed properties, including the name of the licensed character,
+title of the animated cartoon/live action theatrical motion picture, costumes, environmental settings, plot elements and artwork together
+as the licensed property in approved venues in a specified number of territories. During the experience event, event attendees may separately
+purchase, in designated area(s) at the approved venue, (i) various interactive activities and/or entertainment, including hands-on active-play/participation
+and/or media-based activities, such as green-screen photo/video capturing activities where guests are offered the opportunity to have
+their photo and/or video taken using green-screen capture technology, or the interactive opportunities; (ii) custom-made merchandise
+featuring the licensed property that are commissioned specially for the experience event, or the custom-made merchandise, as well as
+other licensed merchandise featuring the licensed property that are supplied by the IP owners and/or its licensee(s); and (iii) food
+and beverage products.
+
+ 
+
+Apart
+from organizing, planning, promoting and managing experience events, we also engage in the design and/or sale of merchandise, such as
+merchandise sold in concert venues and merchandise used as gift with purchase by our customers, as well as event management for brands,
+such as setting-up and running of pop-up stores and organizing store opening/product launch press events for labels.
+
+ 
+
+During
+the COVID-19 pandemic, or COVID-19 pandemic, most of the in-person events were rescheduled, postponed or cancelled and
+our business relied on the design and/or sale of merchandise and government subsidies. When things started to normalize after the
+COVID-19 pandemic, our business primarily focused on event management business again.
+
+ 
+
+During
+the six months ended September 30, 2024, we started to be an event organizer for events.
+
+ 
+
+For
+the six months ended September 30, 2023 and 2024, our net revenue amounted to approximately HK$3.8 million and approximately HK$31.0
+million, respectively, representing an increase of approximately 722%. Due to our business expansion as event organizer for events and
+the end of the COVID-19 pandemic lock down policies by the HK government, we recorded a net profit for the six months ended September
+30, 2023 amounting to approximately HK$1.36 million compared to a net profit for the year ended September 30, 2024 amounting to approximately
+HK$2.71 million.
+
+ 
+
+For
+the years ended March 31, 2023 and 2024, our net revenue amounted to approximately HK$3.6 million and approximately HK$20.4 million,
+respectively, representing an increase of approximately 465%. Due to our business expansion and the end of the COVID-19 pandemic
+lock down policies by the HK government, we recorded a net loss for the year ended March 31, 2023 amounting to approximately HK$0.48
+million compared to a net profit for the year ended March 31, 2024 amounting to approximately HK$7.09 million.
+
+ 
+
+ -3-
+
+ 
+
+ 
+
+ 
+
+Our
+Competitive Strengths
+
+ 
+
+We
+believe the following competitive strengths have contributed to our success to date and will continue to distinguish us from our competitors:
+
+ 
+
+ We
+ have an established reputation and proven track record in the events industry;
+
+ 
+
+ We
+ have the ability to manage the entire event lifecycle;
+
+ 
+
+ Our
+ management team possesses extensive events industry experience and business network;
+
+ 
+
+ We
+ have built a good relationship with an established network of service providers that are
+ essential for our operations;
+
+ 
+
+ Our
+ creative offerings help to ensure the profitability of experience events; and
+
+ 
+
+ We
+ have our own event venue.
+
+ 
+
+Our
+Business Strategies
+
+ 
+
+We
+plan to continue to expand the breadth and depth of our event management, design and merchandising services, thereby expanding our market
+share in the events industry in Hong Kong as well as to develop more overseas markets for our event management and merchandising businesses.
+To achieve these business goals, we plan to:
+
+ 
+
+ 
+ 
+ 
+ Build
+ on our core business as an event planner and move up the value chain from a pure service provider to also play the role of an event
+ organizer;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Obtaining
+ multi-territorial IP licenses from IP owners to help us increase our market share in Hong Kong and further develop overseas markets;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Build
+ our own ticketing platform to facilitate direct marketing of the events we organize and the collection of full engagement data on
+ event attendees; and 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Expand
+ our project department, finance and administration department, set up a new sales and marketing department and an information technology
+ department as well as to upgrade our enterprise resource planning, or ERP, system.
+
+ 
+ 
+
+ -4-
+
+ 
+
+ 
+
+ 
+
+Corporate
+Information
+
+ 
+
+Our
+Company was incorporated in the Cayman Islands on July 5, 2024. Our registered office in the Cayman Islands is located at Cricket Square,
+Hutchins Drive, P. O. Box 2681, Grand Cayman, KY1-1111, Cayman Islands. Our administrative office is located at No. 5, 17th
+Floor, PeakCastle, No. 476 Castle Peak Road, Cheung Sha Wan, Kowloon, Hong Kong. Our telephone number is +852 5628 6281. The information
+contained on, or that can be accessed through, our website (http://www.trendicint.com) is not incorporated into this prospectus and is
+not part of this prospectus. Our agent for service of process in the United States is Cogency Global Inc., 122 East 42nd
+Street, 18th Floor, New York, NY 10168.
+
+ 
+
+Transfers
+of Cash to and From Our Subsidiaries
+
+ 
+
+Our
+business is primarily conducted through our indirect wholly-owned operating subsidiary, Trendic. The Cayman Islands holding company will
+rely on dividends paid by its subsidiaries namely, Goal Success Global Limited, or Goal Success, our direct wholly-owned subsidiary and
+the latter s wholly-owned operating subsidiary, Trendic, for our Company s working capital and cash needs, including the
+funds necessary to pay any dividends. Our Company and Goal Success are Cayman Islands and BVI holding companies, respectively. Only Trendic
+operates in Hong Kong.
+
+ 
+
+For
+the fiscal years ended March 31, 2023 and 2024, Trendic declared and paid a dividend of HK$5,500,000 on March 30, 2024 to its then
+existing shareholders. For the six months ended September 30, 2023 and 2024, no dividend was declared or paid by Trendic to its
+then existing shareholders. If we decide to pay dividends on any of our Class A Ordinary Shares, as a holding company, we will
+depend on the receipt of funds from Trendic through dividend payments. We are permitted under the laws of the Cayman Islands and BVI
+to provide funding to Trendic through loans and/or capital contributions without restriction on the amount of the funds loaned or
+contributed.
+
+ 
+
+We
+currently intend to retain all of our available funds and future earnings, if any, for the operation and expansion of our business and
+do not anticipate declaring or paying any dividends shortly after the listing. We do not have a formal cash management policy. Any future
+determination related to our dividend policy will be made at the discretion of our board of directors after considering our financial
+condition, results of operations, capital requirements, contractual requirements, business prospects and other factors the board of directors
+deems relevant, and subject to the restrictions contained in any future financing instruments.
+
+ 
+
+Cayman
+Islands. Subject to the Companies Act (as revised) of the Cayman Islands, as amended, supplemented or otherwise modified from time
+to time, or Companies Act, and our articles of association of our Company adopted on July 5, 2024, as amended and restated from time
+to time, or Articles of Association, our board of directors may declare dividends and distributions on our Class A Ordinary Shares and
+authorize payment of dividends or distributions out of the funds of the Company. No dividend or distribution shall be paid except out
+of our realized or unrealized profits, or out of our share premium account unless immediately following the payment we are able to pay
+our debts as they fall due in the ordinary course of business.
+
+ 
+
+British
+Virgin Islands. Under BVI law, the board of directors of our BVI subsidiary may authorize payment of a dividend to its shareholders
+as such time and of such an amount as they determine if they are satisfied on reasonable grounds that immediately following the dividend
+the value of our assets will exceed our liabilities and our BVI subsidiary will be able to pay its debts as they become due.
+
+ 
+
+ -5-
+
+ 
+
+ 
+
+ 
+
+Hong
+Kong. Under Hong Kong law, dividends may only be paid out of distributable profits (that is, accumulated realized profits less accumulated
+realized losses) or other distributable reserves. Dividends cannot be paid out of share capital. At this time, there are no restrictions
+or limitations under the laws of Hong Kong imposed on the conversion of HK dollars into foreign currencies and the remittance of currencies
+out of Hong Kong, nor is there any restriction on foreign exchange to transfer cash between the Company and its subsidiaries, across
+borders and to U.S. investors, nor are there any restrictions or limitations on distributing earnings from our business and subsidiaries
+to the Company and U.S. investors. Under the current practice of the Inland Revenue Department of Hong Kong, no tax is payable in Hong
+Kong in respect of dividends paid by us. However, the PRC government may, in the future, impose restrictions or limitations on our ability
+to move money out of Hong Kong to distribute earnings and pay dividends to and from the other entities within our organization or to
+reinvest in our business outside of Hong Kong. Such restrictions and limitations, if imposed in the future, may delay or hinder the expansion
+of our business outside of Hong Kong and may affect our ability to receive funds from Trendic.
+
+ 
+
+For
+more information, see "Dividend Policy," "Risk Factors", "Selected Consolidated Financial
+and Other Data" and "Consolidated Statements of Changes in Shareholders Equity"
+in the Report of the independent registered public accounting firm.
+
+ 
+
+Corporate
+Structure
+
+ 
+
+The
+PRC government may, in the future, disallow our corporate structure, which restrictions would likely result in a material change in our
+operations and/or in the value of our Class A Ordinary Shares. Such restrictions may cause the value of our Class A Ordinary Shares to
+decline significantly in value or be rendered worthless.
+
+ 
+
+The
+following diagram illustrates our corporate structure as of the date of this prospectus and upon completion of our offering based on
+a proposed number of 2,000,000 Class A Ordinary Shares being offered. Unless otherwise stated, all percentages reflect the equity
+interests held by each of our shareholders. Each holder of Class A Ordinary Shares is entitled to one vote per Class A Ordinary Share
+and each holder of Class B Ordinary Shares is entitled to twelve (12) votes per one Class B Ordinary Share. Investors are purchasing
+shares in our Company, and Trendic is the entity in which the Group s operations are conducted.
+
+ 
+
+ 
+
+Notes:
+
+ 
+
+ 
+ (1)
+ Prime Crest is wholly-owned
+ by Mr. Cheung Sze Wah, Sam, an independent third party.
+
+ 
+ (2)
+ Fuji Holdings Limited,
+ or Fuji Holdings, is wholly-owned by Mr. Chang Kin Man, an independent third party.
+
+ 
+ (3)
+ Kilo Wonders is wholly-owned
+ by Ms. Yip, an independent third party and an existing shareholder of Trendic.
+
+ 
+ (4)
+ Yield Rights is wholly-owned
+ by Ms. Lau Wing Yu, an independent third party.
+
+ 
+ (5)
+ Allied Target Limited is
+ wholly-owned by Mr. Cheung Ching Ping, an independent third party.
+
+ 
+ *
+ Represents voting
+ interest.
+
+ 
+ #
+ Takes into account the sale of 660,000 Class A Ordinary Shares by Ms. Seto in the offering.
+
+ 
+
+ 
+
+Other
+than Ms. Seto, none of the other shareholders have held any position, office or other material relationship with the Company or any of
+its predecessors or affiliates within the past three years.
+
+ 
+
+Summary
+Risk Factors
+
+ 
+
+Investing
+in our Class A Ordinary Shares involves risks. You should carefully read and consider all of the information contained in this prospectus,
+including in "Risk Factors," "Management s Discussion and Analysis of Financial Condition and Results
+of Operations" and our consolidated financial statements and the notes thereto, before making an investment decision.
+
+ 
+
+For
+example, see "Risk Factors Relating to Doing Business in Hong Kong" beginning on page 33 for a detailed discussion
+about the number of risks relating to an investment in our Company arising from the legal system in China, including but not limited
+to:
+
+ 
+
+ 
+ 
+ risks
+ and uncertainties regarding the enforcement of laws and that rules and regulations in China can change quickly with little advance
+ notice – see "Risk Factors – Risks Relating to Doing Business in Hong Kong - We may become subject to a variety
+ of PRC laws and other regulations regarding data protection or cybersecurity, and any failure to comply with applicable laws and
+ regulations could have a material and adverse effect on our business, financial condition and results of operations" on
+ page 35;
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ risk that the Chinese government may intervene or influence our operations at any time, or may exert more control over offerings
+ conducted overseas and/or foreign investment in China-based issuers, which could result in a material change in our operations and/or
+ the value of our Class A Ordinary Shares – see "Risk Factors – Risks Relating to Doing Business in Hong Kong"
+ that begins "Through long arm provisions under the current PRC laws and regulations, the PRC government may exercise significant
+ oversight over the conduct of our business" on page 33;
+
+ 
+ 
+
+ -6-
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ any
+ actions by the Chinese government to exert more oversight and control over offerings that are conducted overseas and/or foreign investment
+ in China-based issuers could significantly limit or completely hinder our ability to offer or continue to offer securities to investors
+ and cause the value of our Class A Ordinary Shares to significantly decline or be worthless – see "Risk Factors –
+ Risks Relating to Doing Business in Hong Kong" that begins "Through long arm provisions under the current PRC
+ laws and regulations, the PRC government may exercise significant oversight over the conduct of our business" on page 33.
+
+ 
+ 
+
+The
+risks summarized below are qualified by reference to "Risk Factors" beginning on page 17 of this prospectus, which
+you should carefully consider before making a decision to invest in our Class A Ordinary Shares. If any of these risks actually
+occurs, our business, financial condition or results of operations would likely be materially adversely affected. In such case, the trading
+price of our Class A Ordinary Shares would likely decline, and you may lose all or part of your investment. In reviewing this
+prospectus, you should bear in mind that past results are no guarantee of future performance. See "Cautionary Statement Regarding
+Forward-Looking Statements" for a discussion of forward-looking statements, and the significance of forward-looking statements
+in the context of this prospectus.
+
+ 
+
+The
+following is a summary of what our management views as our most significant risk factors including but not limited to the following:
+
+ 
+
+ 
+ 
+ We
+ are transitioning into a new business model which makes it difficult to evaluate our prospects and future financial results, and
+ our past growth rate, revenue and net profit margin may not be indicative of our future growth rate, revenue and net profit margin.
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ may implement business strategies and growth plans that may not be successful.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ loss of one or more of our major customers or our failure to secure new customers may adversely
+ affect our business, results of operations and financial condition.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ may face revenue concentration risk due to reliance on a single key customer.
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ depend on our management team, particularly Ms. Seto, and our ability to retain them and
+ attract additional qualified personnel is critical to our success and our growth prospects.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ business is substantially dependent upon the continued strength of the market for experience
+ events.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ business and results of operations may be adversely affected if we are unable to capture,
+ predict or respond timely to our customers and/or their end consumers needs
+ and preferences or keep up with market trend for experience events and merchandise.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ Fluctuations
+ in consumer spending caused by social, economic, political and legal developments or instability,
+ as well as any changes in government policies, in Hong Kong and other Southeast Asian countries
+ could materially and adversely affect our business, results of operations, financial condition
+ and business prospects.
+
+ 
+
+ 
+ 
+
+ -7-
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ We
+ provide event management, design and/or merchandising services to our customers on a project-by-project
+ basis which exposes us to the risk of uncertainty and potential volatility with respect to
+ our revenue.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ enter into fixed-price contracts with our customers, and our failure to accurately estimate
+ the resources and time required to perform these contracts could materially and adversely
+ affect our business, results of operations and financial condition.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ success depends on our ability to maintain our reputation and our business and financial
+ results may be harmed if events occur that damage our reputation.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ operate in a competitive market.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ A
+ shift in our customers business model may adversely affect our business, results of
+ operations and financial condition.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ operating margin may decline as a result of increasing cost of revenue and other indirect costs.
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ may incur losses in the future.
+
+ 
+ 
+ 
+
+ 
+ 
+ There
+ is no guarantee that we will receive payments from our customers in full on time or at all.
+
+ 
+
+ 
+ 
+ Errors,
+ defects, interruptions or any other malfunction or safety issues causing disruption to our
+ customers events could diminish demand for our event management, design and/or merchandising
+ services.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ depend on third-party vendors to assist us with the organization, planning, promotion and/or
+ management of events.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ are dependent on third-party manufacturers for the production of merchandise, and any disruption
+ to our relationship or their manufacturing operations could adversely affect our merchandising
+ services.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ rely on a limited number of key suppliers.
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ may be exposed to intellectual property, or IP, infringement claims by third parties against
+ IP owners, our customers, ourselves and/or any other sub-licensees and if we fail to defend
+ such claims, they could subject us to significant liabilities and other costs, and we may
+ not be allowed to continue to use certain of the IP rights.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ If
+ we are unable to protect the IP owners IP rights in the licensed property effectively,
+ our business and reputation could suffer.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ If
+ we are unable to maintain and protect our IP, or if third parties assert that we infringe
+ on their IP rights, our business could suffer.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ Any
+ failure to maintain an effective quality control system may have a material adverse effect
+ on our reputation, results of operations and financial condition.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ nature of our business exposes us to product liability claims.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ Legal
+ disputes or proceedings may expose us to liabilities, divert our management s attention
+ and adversely affect our reputation.
+
+ 
+
+ 
+ 
+ Natural
+ disasters and other catastrophic events beyond our control could adversely affect our business
+ operations and financial performance.
+
+ 
+
+ 
+ 
+ Our
+ business and operations may be materially and adversely affected in the event of a resurgence
+ of the COVID-19 pandemic.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ current insurance coverage may not sufficiently protect us against all the risks we are exposed
+ to, and the insurance premium may increase.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ business could be adversely affected by information technology systems breakdown or disruption.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ Fluctuations
+ in foreign currency exchange rates may materially and adversely affect our financial condition
+ and results of operations.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ aging population may have an adverse effect on our business, results of operations and financial
+ condition.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ business may be subject to seasonal effects, which may adversely affect our liquidity and
+ results of operations in certain seasons.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ may need to raise additional capital required to grow our business, and we may be unable
+ to raise capital on terms acceptable to us or at all.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ Our
+ executive officers have no prior experience in operating a U.S. public company, and their
+ inability to operate the public company aspects of our business could harm us.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ If
+ we fail to implement and maintain an effective system of internal controls, we may be unable
+ to accurately or timely report our results of operations or prevent fraud, and investor confidence
+ and the market price of our Class A Ordinary Shares may be materially and adversely affected.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ will be subject to changing laws, rules and regulations in the U.S. regarding regulatory
+ matters, corporate governance and public disclosure that will increase both our costs and
+ the risks associated with non-compliance.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ In
+ the event the PRC government restricts or prohibits cash transfers from Hong Kong, our ability to distribute earnings and pay dividends
+ may be impeded, thus limiting our ability to grow our business or receive earnings to the detriment of our investors.
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ Chinese regulatory authorities could disallow our organizational structure, which would likely result in a material change in our
+ operations and/or a material change in the value of the securities we are registering for sale, including that it could cause the
+ value of such securities to significantly decline or become worthless.
+
+ 
+ 
+
+ -8-
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ The
+ market price of our Class A Ordinary Shares may be volatile or may decline regardless of our
+ operating performance, and could result in significant losses and you may not be able to
+ resell your shares at or above the offering price.
+
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ You
+ may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because
+ we are incorporated under Cayman Islands law.
+
+ 
+ 
+ 
+
+ 
+ 
+ Because
+ we are a Cayman Islands company and all of our business is conducted in Hong Kong, you may be unable to bring an action against us
+ or our officers and directors or to enforce any judgment you may obtain.
+
+ 
+ 
+ 
+
+ 
+ 
+ We
+ are a foreign private issuer within the meaning of the rules under the Exchange Act, and as such we are exempt from certain provisions
+ applicable to United States domestic public companies.
+
+ 
+ 
+
+Holding
+Foreign Companies Accountable Act
+
+ 
+
+The
+Holding Foreign Companies Accountable Act, or HFCA, Act was enacted on December 18, 2020. The HFCA Act states if the United States Securities
+and Exchange Commission, or the SEC or the Securities and Exchange Commission, determines that a company has filed audit reports issued
+by a registered public accounting firm that has not been subject to inspection by the Public Company Accounting Oversight Board of the
+United States, or PCAOB, for two consecutive years beginning in 2021, the SEC shall prohibit the company s shares from being traded
+on a national securities exchange or in the over-the-counter trading market in the United States. Our auditor, TAAD LLP, or TAAD, the
+independent registered public accounting firm that issues the audit report included in this prospectus, as an auditor of companies that
+are operating in the United States and a firm registered with the PCAOB, is subject to laws in the United States pursuant to which the
+PCAOB conducts regular inspections to assess TAAD s compliance with applicable professional standards. TAAD is headquartered in
+the United States, and can be inspected by PCAOB. On August 26, 2022, CSRC, the Ministry of Finance of the PRC, and the PCAOB signed
+a Statement of Protocol (the "Protocol"), governing inspections and investigations of audit firms based in China and Hong
+Kong. Pursuant to the fact sheet with respect to the Protocol disclosed by the SEC, the PCAOB shall have independent discretion to select
+any issuer audits for inspection or investigation and has the unfettered ability to transfer information to the SEC. On December 15,
+2022, the PCAOB Board determined that the PCAOB was able to secure complete access to inspect and investigate registered public accounting
+firms headquartered in mainland China and Hong Kong and voted to vacate its previous determinations to the contrary. However, should
+PRC authorities obstruct or otherwise fail to facilitate the PCAOB s access in the future, the PCAOB Board will consider the need
+to issue a new determination. On December 29, 2022, the Accelerating Holding Foreign Companies Accountable Act, or the Accelerating HFCA
+Act, was signed into law, which amended the HFCA Act by requiring the SEC to prohibit an issuer s securities from trading on any
+U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead of three. On December 29, 2022,
+legislation titled "Consolidated Appropriations Act, 2023" (the "Consolidated Appropriations Act"), was signed
+into law by former President Biden. The Consolidated Appropriations Act contained, among other things, an identical provision
+to Accelerating HFCA Act, which reduces the number of consecutive non-inspection years required for triggering the prohibitions under
+the HFCA Act from three years to two. As a result of the Consolidated Appropriations Act, the Holding Foreign Companies Accountable Act
+(the "HFCA Act") now also applies if the PCAOB s inability to inspect or investigate the relevant accounting firm is
+due to a position taken by an authority in any foreign jurisdiction. The denying jurisdiction does not need to be where the accounting
+firm is located. Our current auditor, TAAD, is a firm registered with the PCAOB with its headquarters at Diamond Bar, California, is
+subject to laws in the United States pursuant to which the PCAOB conducts regular inspections to assess its compliance with the applicable
+professional standards. Notwithstanding the foregoing, in the future, if there is any regulatory change or step taken by PRC regulators
+that does not permit our auditor to provide audit documentations located in China to the PCAOB for inspection or investigation, investors
+may be deprived of the benefits of such inspection. Any audit reports not issued by auditors that are completely inspected by the PCAOB,
+or a lack of PCAOB inspections of audit work undertaken in China that prevents the PCAOB from regularly evaluating our auditors 
+audits and their quality control procedures, could result in a lack of assurance that our financial statements and disclosures are adequate
+and accurate, then such lack of inspection could cause our securities to be delisted from the stock exchange. We cannot assure you
+whether Nasdaq or other regulatory authorities will apply additional or more stringent criteria to us. Such uncertainty could cause the
+market price of our Class A Ordinary Shares to be materially and adversely affected.
+
+ 
+
+Recent
+Regulatory Developments in the PRC
+
+ 
+
+Recently,
+the PRC government initiated a series of regulatory actions and statements to regulate business operations in certain areas in China,
+including cracking down on certain illegal activities in the securities market, enhancing supervision over Chinese-based companies listed
+overseas using a VIE structure, adopting new measures to extend the scope of cybersecurity reviews, and expanding efforts in anti-monopoly
+enforcement. For a further discussion of how recent regulatory developments in the PRC could affect our ability to do business
+in Hong Kong, see "Risk Factors — Risks Relating to Doing Business in Hong Kong" beginning on page 33 of this
+prospectus.
+
+ 
+
+For
+example, on June 10, 2021, the Standing Committee of the National People s Congress enacted the PRC Data Security Law, which took
+effect on September 1, 2021. The law requires data collection to be conducted in a legitimate and proper manner, and stipulates that,
+for the purpose of data protection, data processing activities must be conducted based on data classification and hierarchical protection
+system for data security.
+
+ 
+
+ -9-
+
+ 
+
+ 
+
+ 
+
+On
+July 6, 2021, the General Office of the Communist Party of China Central Committee and the General Office of the State Council jointly
+issued a document to crack down on certain illegal activities in the securities markets to promote the high-quality development of the
+capital markets, which, among other things, requires the relevant governmental authorities to strengthen cross-border oversight of law-enforcement
+and judicial cooperation, to enhance supervision over Chinese-based companies listed overseas, and to establish and improve the system
+of extraterritorial application of the PRC securities laws.
+
+ 
+
+On
+August 20, 2021, the 30th meeting of the Standing Committee of the 13th National People s Congress voted and passed the "Personal
+Information Protection Law of the People s Republic of China," or PRC Personal Information Protection Law, which became effective
+on November 1, 2021. The PRC Personal Information Protection Law applies to the circumstances that processing of personal information
+of natural persons within the territory of China and that is carried out outside of China where (1) such processing is for the purpose
+of providing products or services for natural persons within China, (2) such processing is to analyze or evaluate the behavior of natural
+persons within China, or (3) there are any other circumstances stipulated by related laws and administrative regulations.
+
+ 
+
+On
+December 28, 2021, the CAC jointly with the relevant authorities formally published Measures for Cybersecurity Review (2021) which took
+effect on February 15, 2022, replacing the former Measures for Cybersecurity Review (2020) issued on April 13, 2020. Measures for Cybersecurity
+Review (2021) stipulates that operators of critical information infrastructure purchasing network products and services, and online platform
+operators (together with the operators of critical information infrastructure, or the Operators, carrying out data processing activities
+that affect or may affect national security, shall conduct a cybersecurity review, and any online platform operator who controls more
+than one million users personal information must undergo a cybersecurity review by the cybersecurity review office if it seeks
+to be listed in a foreign country.
+
+ 
+
+We
+do not expect to be subject to the cybersecurity review by the CSRC and the CAC in relation to this offering, given that: (1) our principal
+operating subsidiary, Trendic, is incorporated in Hong Kong and is located in Hong Kong, not a PRC domestic company, (2) we have no subsidiary,
+VIE structure or any direct operations in mainland China, and (3) pursuant to the Basic Law, which is a national law of the PRC and the
+constitutional document for Hong Kong, national laws of the PRC shall not be applied in Hong Kong, except for those listed in Annex III
+of the Basic Law (which is confined to laws relating to defense and foreign affairs, as well as other matters outside the autonomy of
+Hong Kong).
+
+ 
+
+We
+do not currently expect the Measures for Cybersecurity Review (2021) and the PRC Personal Information Protection Law to have an impact
+on our business, operations or this offering as we do not believe that Trendic would be deemed to be an "Operator" on the
+basis that (i) Trendic is incorporated in Hong Kong, not a PRC domestic company, and operates in Hong Kong without any subsidiary or
+VIE structure in mainland China, and each of the Measures for Cybersecurity Review (2021) and the PRC Personal Information Protection
+Law remains unclear whether it shall be applied to a company based in Hong Kong; (ii) as of date of this prospectus, Trendic has in aggregate
+collected and stored personal information of less than one million users, and that data processed in our business does not have a bearing
+on national security and thus may not be classified as core or important data by the authorities; (iii) all of the data that Trendic
+has collected is stored in servers located in Hong Kong; and (iv) as of the date of this prospectus, Trendic has not been informed by
+any PRC governmental authority of any requirement that it files for a cybersecurity review or a CSRC review. An "Operator"
+is required to file for cybersecurity review before listing in the United States.
+
+ 
+
+ -10-
+
+ 
+
+ 
+
+ 
+
+On
+February 17, 2023, the CSRC issued the Trial Overseas Listing Measures, which came into effect on March 31, 2023. Under the Trial Overseas
+Listing Measures, a domestic enterprise conducting overseas issuance and listing (includes direct and indirect overseas issuance and
+listing) shall conduct and complete relevant filing procedures with the CSRC. Any overseas issuance and listing conducted by an issuer
+that concurrently meets the following conditions shall be determined as indirect overseas issuance and listing by a domestic enterprise:
+(i) 50% or more of its operating revenue, total profit, total assets or net assets as recorded in its audited consolidated financial
+statements for the most recent fiscal year is being accounted for by domestic companies; and (ii) the main parts of its business activities
+are conducted in mainland China, its principal places of business are located in mainland China, or the senior management in charge of
+its business operation and management are mostly Chinese citizens or domiciled in mainland China.
+
+ 
+
+Based
+on the above mentioned, given that (i) the Group currently does not have, nor does it currently intend to establish, any subsidiary nor
+plan to enter into any contractual arrangements to establish a VIE structure with any entity in the PRC; (ii) it is not controlled by
+any PRC entity or individual; (iii) it does not have any operation in the PRC, nor does it have any partnership or cooperation with any
+PRC entity or individual; (iv) it currently does not have, nor does it plan to have, any investment, such as owning or leasing any asset,
+in the PRC; (v) none of the senior managers in charge of the business operations and management are citizens of the PRC or domiciled
+in mainland China; and (vi) no revenue of the Company is generated from the PRC, this offering shall not be deemed as a domestic enterprise
+that indirectly offer or list securities on an overseas stock exchange, nor does it requires filing or approvals from the CSRC. We are
+not subject to any PRC laws and regulations except to those applicable to Hong Kong listed in Annex III of the Basic Law. We believe,
+and we have been advised by our PRC legal counsel, that we do not need permission or approval from the Chinese government to operate
+our business or offer our Class A Ordinary Shares to investors. As such, we have not applied for, and we have not been denied any permissions
+or approvals.
+
+ 
+
+Further,
+as of the date of this prospectus, in the opinion of our PRC legal counsel, Guangdong Wesley Law Firm, the Company is not considered
+a domestic enterprise under the Trial Measures and the Trial Measures do not apply to the Company, and its listing on Nasdaq does not
+require fulfilling the filing procedure to the CSRC. However, there can be no assurance that the relevant PRC governmental authorities,
+including the CSRC, would reach the same conclusion as us, or that the CSRC or any other PRC governmental authorities would not promulgate
+new rules or new interpretation of current rules (with retrospective effect) to require us to obtain CSRC or other PRC governmental approvals
+for this offering. If we or Trendic inadvertently conclude that such approvals are not required, we may be required to make corrections,
+be given a warning, be fined between RMB 1 million and RMB 10 million, warn the responsible person and impose a fine of not less than
+RMB 500,000 but not more than RMB 5 million, fine the controlling shareholder not less than RMB 1 million but not more than RMB 10 million,
+prevent the Company from entering the securities market and our ability to offer or continue to offer our Class A Ordinary Shares to investors
+could be significantly limited or completed hindered, which could cause the value of our Class A Ordinary Shares to significantly decline
+or become worthless. Our Group may also face sanctions by the CSRC, the CAC or other PRC regulatory agencies. These regulatory agencies
+may impose fines and penalties on our operations in China, limit our ability to pay dividends outside of the PRC, limit our operations
+in the PRC, delay or restrict the repatriation of the proceeds from this offering into the PRC or take other actions that could have
+a material adverse effect on our business, financial condition, results of operations and prospects, as well as the trading price of
+our securities.
+
+ 
+
+ -11-
+
+ 
+
+ 
+
+ 
+
+However,
+since these statements and regulatory actions are new and under development, it is highly uncertain how soon the legislative or administrative
+regulation-making bodies will respond and what existing or new laws or regulations or detailed implementations and interpretations will
+be modified or promulgated, if any. It is also highly uncertain what the potential impact such modified or new laws and regulations will
+have on the daily business operations of Trendic, its ability to accept foreign investments and the listing of our Class A Ordinary Shares
+on U.S. or other foreign exchanges. If Trendic is deemed to be an "Operator," or if Measures for Cybersecurity Review
+(2021), the PRC Personal Information Protection Law or the Trial Overseas Listing Measures becomes applicable to Trendic, the business
+operation of Trendic and the listing of our Class A Ordinary Shares in the United States could be subject to the CAC s cybersecurity
+review or CSRC Overseas Issuance and Listing review in the future. If the applicable laws, regulations, or interpretations change and
+Trendic becomes subject to the CAC or CSRC review, we cannot assure you that Trendic will be able to comply with the regulatory requirements
+in all respects and our current practice of collecting and processing personal information may be ordered to be rectified or terminated
+by regulatory authorities. If Trendic fails to receive or maintain such permissions or if the required approvals are denied, Trendic
+may become subject to fines and other penalties which may have a material adverse effect on our business, operations and financial condition
+and may hinder our ability to offer or continue to offer Class A Ordinary Shares to investors and cause the value of our Class A Ordinary Shares
+to significantly decline or be worthless.
+
+ 
+
+Additionally,
+due to long arm provisions under the current PRC laws and regulations, there remains regulatory uncertainty with respect to the implementation
+and interpretation of laws in China. We are also subject to the risks of uncertainty about any future actions the Chinese government
+or authorities in Hong Kong may take in this regard.
+
+ 
+
+Should
+the Chinese government choose to exercise significant oversight and discretion over the conduct of our Hong Kong operating subsidiary s
+business, it may intervene in or influence our operations. Such governmental actions (i) could result in a material change in Trendic s
+operations; (ii) could hinder our ability to continue to offer securities to investors; and (iii) may cause the value of our Class A Ordinary Shares to significantly decline in value or become worthless.
+
+ 
+
+Implications
+of Being a "Controlled Company"
+
+ 
+
+Upon
+completion of this offering, Ms. Seto will be the beneficial owner of an aggregate of 21,236,240 Class A Ordinary Shares which will represent
+70.81% of the then total issued and outstanding Class A Ordinary Shares. Ms. Seto will also be the beneficial owner of 100% of our outstanding
+Class B Ordinary Shares, which together with the Class A Ordinary Shares, will represent 79.13% of the total aggregate voting
+power of the Company. As a result, we will be a "controlled company" within the meaning of the Nasdaq Stock Market Rules
+and therefore eligible for certain exemptions from the corporate governance requirements of the Nasdaq listing rules. For so long as
+we are a controlled company under that definition, we are permitted to elect to rely, and may rely, on certain exemptions from corporate
+governance rules, including:
+
+ 
+
+ 
+ 
+ an
+ exemption from the rule that the compensation of our chief executive officer must be determined or recommended solely by independent
+ directors;
+
+ 
+ 
+
+ -12-
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ an
+ exemption from the rule that director nominees be selected or recommended for selection by either a majority of the independent directors
+ or a nomination committee comprised solely of independent directors; and
+
+ 
+ 
+ 
+
+ 
+ 
+ an
+ exemption from the rule that a majority of our board of directors consist of independent directors.
+
+ 
+ 
+
+As
+a result, you may not have the same protection afforded to shareholders of companies that are subject to these corporate governance requirements
+although we currently do not intend to rely on the exemptions.
+
+ 
+
+In
+addition, our controlling shareholder will be able to exert significant control over our management and affairs, including approval of
+significant corporate transactions. Our status as a controlled company could cause our Class A Ordinary Shares to look less attractive
+to certain investors or otherwise harm our trading price. As a result, the investors will not have the same protection afforded to shareholders
+of companies that are subject to these corporate governance requirements.
+
+ 
+
+Implications
+of Our Being an Emerging Growth Company
+
+ 
+
+As
+a company with less than US$1.235 billion in revenue during our last fiscal year, we qualify as an "emerging growth company"
+as defined in the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. An emerging growth company may take advantage of specified
+reduced reporting and other requirements that are otherwise applicable generally to public companies. These provisions include:
+
+ 
+
+ 
+ 
+ may
+ present only two years of audited financial statements and only two years of related Management s Discussion and Analysis of
+ Financial Condition and Results of Operations, or MD 
+
+ 
+ 
+ 
+
+ 
+ 
+ are
+ not required to provide a detailed narrative disclosure discussing our compensation principles, objectives and elements and analyzing
+ how those elements fit with our principles and objectives, which is commonly referred to as "compensation discussion and analysis";
+
+ 
+ 
+ 
+
+ 
+ 
+ are
+ not required to obtain an attestation and report from our auditors on our management s assessment of our internal control over
+ financial reporting pursuant to the Sarbanes-Oxley Act of 2002;
+
+ 
+ 
+
+ 
+ 
+ are
+ not required to obtain a non-binding advisory vote from our shareholders on executive compensation or golden parachute arrangements
+ (commonly referred to as the "say-on-pay," "say-on frequency" and "say-on-golden-parachute" votes);
+
+ 
+ 
+ 
+
+ 
+ 
+ are
+ exempt from certain executive compensation disclosure provisions requiring a pay-for-performance graph and chief executive officer
+ pay ratio disclosure;
+
+ 
+ 
+ 
+
+ 
+ 
+ are
+ eligible to claim longer phase-in periods for the adoption of new or revised financial accounting standards under 107 of the
+ JOBS Act; and
+
+ 
+ 
+
+ -13-
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ will
+ not be required to conduct an evaluation of our internal control over financial reporting until our second annual report on Form
+ 20-F following the effectiveness of our initial public offering.
+
+ 
+ 
+
+We
+will take advantage of these reporting exemptions until we are no longer an emerging growth company. We will remain an emerging growth
+company until the earliest of (1) the last day of the fiscal year in which the fifth anniversary of the completion of this offering occurs,
+(2) the last day of the fiscal year in which we have total annual gross revenue of at least US$1.235 billion, (3) the date on which we
+are deemed to be a "large accelerated filer" under the Exchange Act, which means the market value of our Class A Ordinary Shares
+that are held by non-affiliates exceeds US$700.0 million as of the end of the second quarter of that fiscal year, and (4) the date
+on which we have issued more than US$1.0 billion in non-convertible debt during the prior three-year period. We may choose to take advantage
+of some, but not all, of the available exemptions. We have included two years of selected financial data in this prospectus in reliance
+on the first exemption described above. Accordingly, the information contained herein may be different from the information you receive
+from other public companies in which you hold stock.
+
+ 
+
+Certain
+of these reduced reporting requirements and exemptions were already available to us due to the fact that we also qualify as a "smaller
+reporting company" under SEC rules. For instance, smaller reporting companies are not required to obtain an auditor attestation
+and report regarding management s assessment of internal control over financial reporting, are not required to provide a compensation
+discussion and analysis, are not required to provide a pay-for-performance graph or chief executive officer pay ratio disclosure, and
+may present only two years of audited financial statements and related MD&A disclosure.
+
+ 
+
+Implications
+of Our Being a Foreign Private Issuer
+
+ 
+
+Upon
+completion of this offering, we will report under the Exchange Act as a non-U.S. company with foreign private issuer status. Even after
+we no longer qualify as an emerging growth company, as long as we qualify as a foreign private issuer under the Exchange Act, we will
+be exempt from certain provisions of the Exchange Act that are applicable to U.S. domestic public companies, including:
+
+ 
+
+ 
+ 
+ we
+ are not required to provide as many Exchange Act reports, or as frequently, as a domestic public company;
+
+ 
+ 
+ 
+
+ 
+ 
+ for
+ interim reporting, we are permitted to comply solely with our home country requirements, which are less rigorous than the rules that
+ apply to domestic public companies;
+
+ 
+ 
+ 
+
+ 
+ 
+ we
+ are not required to provide the same level of disclosure on certain issues, such as executive compensation;
+
+ 
+ 
+ 
+
+ 
+ 
+ we
+ are exempt from provisions of Regulation FD aimed at preventing issuers from making selective disclosures of material information;
+
+ 
+ 
+ 
+
+ 
+ 
+ we
+ are not required to comply with the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations
+ in respect of a security registered under the Exchange Act; and
+
+ 
+
+ 
+
+ 
+ 
+ we
+ are not required to comply with Section 16 of the Exchange Act requiring insiders to file public reports of their share ownership
+ and trading activities and establishing insider liability for profits realized from any "short-swing" trading transaction.
+
+ 
+ 
+
+Both
+foreign private issuers and emerging growth companies are also exempt from certain more stringent executive compensation disclosure rules.
+Thus, even if we no longer qualify as an emerging growth company but remain a foreign private issuer, we will continue to be exempt from
+the more stringent compensation disclosures required of companies that are neither emerging growth companies nor foreign private issuers.
+
+ 
+
+In
+addition, as a company incorporated in the Cayman Islands, we are permitted to adopt certain home country practices in relation to corporate
+governance matters that differ significantly from the Nasdaq corporate governance listing requirements. These practices may afford less
+protection to shareholders than they would enjoy if we complied fully with corporate governance listing requirements of the Nasdaq.
+
+ 
+
+Investors
+in our Class A Ordinary Shares should note that, to the extent cash in the business is in Hong Kong or a Hong Kong entity, the funds may
+not be available to fund operations or for other use outside of the PRC due to interventions in or the imposition of restrictions and
+limitations on the ability of these subsidiaries by the PRC government or Hong Kong Government to transfer cash.
+
+ 
+
+ -14-
+
+ 
+
+ 
+
+ 
+
+THE
+OFFERING
+
+ 
+
+ 
+ Offering
+ price
+ 
+ The
+ offering price will be between US$4.00 and US$5.00 per Class A Ordinary Share.
+
+ 
+ 
+ 
+ 
+
+ 
+ Class A Ordinary Shares offered by us and the Selling
+ Shareholder
+ 
+ 2,000,000
+ Class A Ordinary Shares, as to 1,340,000 Class A Ordinary Shares offered by us and 660,000 Class A Ordinary Shares by the Selling Shareholder.
+
+ 
+ 
+ 
+ 
+
+ 
+ Ordinary shares issued and outstanding prior to
+ this offering
+ 
+ 28,660,000
+ Class A Ordinary Shares and 1,000,000 Class
+ B Ordinary Shares (See "Description of Share Capital" for more information).
+
+ 
+ 
+ 
+ 
+
+ 
+ Ordinary shares issued and outstanding immediately
+ after this offering
+ 
+ 30,000,000
+ Class A Ordinary Shares and 1,000,000 Class B Ordinary Shares.
+
+ 
+ 
+ 
+ 
+
+ 
+ Use
+ of proceeds
+ 
+ We
+ estimate that we will receive net proceeds from this offering of up to approximately US$4.4 million, based on an assumed price
+ to the public in this offering of US$4.50 per Class A Ordinary Share (being the midpoint of the range set forth on the cover
+ of this prospectus), after deducting underwriting fees and commissions and estimated offering expenses. We currently intend to use
+ the net proceeds from this offering for (i) the acquisition of a multi-territorial IP license; (ii) the setting up of our own
+ ticketing platform; (iii) possible strategic acquisitions; (iv) expanding our marketing department and financing and administration
+ department; (v) upgrading our enterprise resource planning system; (vi) the repayment of loans made by Ms. Seto to us in connection
+ with the payment of costs and expenses in connection with this offering and obtaining a listing of our Shares on the Nasdaq; and
+ (vii) working capital and corporate purpose.
+
+ 
+ 
+ 
+ 
+
+ 
+ Dividend
+ policy 
+ 
+ Our
+ board of directors will take into account, among other things, the following factors when deciding whether to propose a dividend
+ and in determining the dividend amount: (a) our consolidated operating and financial results; (b) our cash flow situation; (c) our
+ business strategies and future operations and earnings; (d) taxation considerations; (e) interim dividends paid, if any; (f) our
+ capital requirements and expenditure plans; (g) statutory and regulatory restrictions; (h) any restrictions on payment of dividends;
+ and (i) any other factors that our board of directors may consider relevant. It is our current policy to retain all earnings for
+ use by the Company in its business. See "Dividend Policy" for more information.
+
+ 
+ 
+
+ 
+ Lock-up
+ 
+ We,
+ each of our directors and executive officers and our 5.0% or greater shareholders, have agreed, subject to certain exceptions, for
+ a period of 180 days after the closing of the offering, not to, except in connection with this offering, offer, pledge, sell, contract
+ to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to
+ purchase, lend or otherwise transfer or dispose of, directly or indirectly, any Class A Ordinary Shares or any other securities convertible
+ into or exercisable or exchangeable for Class A Ordinary Shares, or enter into any swap or other arrangement that transfers to another,
+ in whole or in part, any of the economic consequences of ownership of Class A Ordinary Shares. See "Shares Eligible for Future
+ Sale" and "Underwriting—Lock-Up Agreements".
+
+ 
+ 
+ 
+ 
+
+ 
+ Risk
+ factors
+ 
+ Investing
+ in our Class A Ordinary Shares involves risks. See "Risk Factors" beginning on page 17 of this prospectus for a
+ discussion of factors you should carefully consider before deciding to invest in our Class A Ordinary Shares.
+
+ 
+ 
+ 
+ 
+
+ 
+ Listing
+ 
+ We
+ plan to apply for the listing of the Class A Ordinary Shares on the Nasdaq Capital Market.
+
+ 
+ 
+ 
+ 
+
+ 
+ Proposed
+ trading symbol
+ 
+ TDIC
+
+ 
+ 
+ 
+ 
+
+ 
+ Transfer
+ agent
+ 
+ Transhare
+ Corporation
+
+ 
+ 
+ 
+ 
+
+ 
+ Payment
+ and settlement
+ 
+ The
+ underwriter expects to deliver the Class A Ordinary Shares against payment therefor through the facilities of the Depository Trust
+ Company on , 2025.
+
+ 
+ 
+
+ -15-
+
+ 
+
+ 
+
+ 
+
+Summary
+Financial Data
+
+ 
+
+The
+following selected consolidated financial data for the financial years ended March 31, 2023 and 2024 have been derived
+from our audited consolidated financial statements. We have derived the financial data for the six months ended September 30,
+2023 and 2024 from our unaudited consolidated financial statements appearing elsewhere in this prospectus. The selected financial
+data set forth below should be read in conjunction with, and are qualified by reference to "Management s Discussion and Analysis
+of Financial Condition and Results of Operations" and our consolidated financial statements and notes thereto included elsewhere
+in this prospectus. Our consolidated financial statements are prepared and presented in accordance with the provisions of the
+IFRS. Our historical results do not necessarily indicate results expected for any future period.
+
+ 
+
+The
+following table shows key components of our results of operations for the six months ended September 30, 2023 and 2024.
+
+ 
+
+ 
+ 
+ Six
+ months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Revenues 
+ $3,545,487 
+ $30,462,186 
+
+ 
+ Revenues,
+ related party 
+ 227,588 
+ 552,166 
+
+ 
+ Total
+ Revenues, net 
+ 3,773,075 
+ 31,014,352 
+
+ 
+ 
+ 
+ 
+
+ 
+ Costs and expenses: 
+ 
+ 
+
+ 
+ Cost of revenue 
+ (2,042,940) 
+ (19,736,299)
+
+ 
+ Cost
+ of revenue – related party 
+ - 
+ (468,350)
+
+ 
+ 
+ (2,042,940) 
+ (20,204,649)
+
+ 
+ Selling, general and administrative
+ expenses 
+ (72,454) 
+ (4,226,640)
+
+ 
+ Research and development 
+ - 
+ (660,000)
+
+ 
+ Amortization 
+ - 
+ (2,318,444)
+
+ 
+ Impairment of rights of
+ use assets 
+ - 
+ (111,136)
+
+ 
+ Depreciation 
+ (149,906) 
+ (238,649)
+
+ 
+ 
+ 
+ 
+
+ 
+ Profit
+ from operations 
+ 1,507,775 
+ 3,254,834 
+
+ 
+ 
+ 
+ 
+
+ 
+ Other income/(expenses): 
+ 
+ 
+
+ 
+ Interest income 
+ 354 
+ 38,676 
+
+ 
+ Finance costs 
+ (129,176) 
+ (232,971)
+
+ 
+ Other
+ income 
+ - 
+ 1,000 
+
+ 
+ Total
+ other income/(expenses), net 
+ (128,822) 
+ (193,295)
+
+ 
+ 
+ 
+ 
+
+ 
+ Profit
+ before income taxes 
+ 1,378,953 
+ 3,061,539 
+
+ 
+ 
+ 
+ 
+
+ 
+ Income
+ tax expense 
+ (23,000) 
+ (350,000)
+
+ 
+ 
+ 
+ 
+
+ 
+ NET
+ PROFIT 
+ $1,355,953 
+ $2,711,539 
+
+ 
+
+ 
+
+The
+following table summarizes our cash flows for the six months ended September 30, 2023 and 2024:
+
+ 
+
+ 
+ 
+ Six
+ months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Net cash provided
+ by/(used in) operating activities 
+ $426,487 
+ $(7,893,870)
+
+ 
+ Net cash provided by/(used
+ in) investing activities 
+ 354 
+ (5,333,101)
+
+ 
+ Net
+ cash provided by/(used in) financing activities 
+ (567,448) 
+ 10,773,040 
+
+ 
+ Net change in cash and
+ cash equivalent 
+ (140,067) 
+ (2,453,931)
+
+ 
+ BEGINNING OF PERIOD 
+ 328,214 
+ 3,817,083 
+
+ 
+ END OF PERIOD 
+ $187,607 
+ $1,363,152 
+
+ 
+
+ 
+
+The
+following table shows key components of our results of operations for the fiscal years ended March 31, 2023 and 2024.
+
+ 
+
+ 
+ 
+ Year
+ Ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Revenues 
+ $1,137,909 
+ $20,103,097 
+
+ 
+ Revenues,
+ related party 
+ 2,477,228 
+ 337,586 
+
+ 
+ Total
+ Revenues, net 
+ 3,615,137 
+ 20,440,683 
+
+ 
+ 
+ 
+ 
+
+ 
+ Costs and expenses: 
+ 
+ 
+
+ 
+ Cost of revenue 
+ (3,262,588) 
+ (11,360,489)
+
+ 
+ General and administrative
+ expenses 
+ (490,636) 
+ (666,286)
+
+ 
+ Depreciation 
+ (206,006) 
+ (294,083)
+
+ 
+ 
+ 
+ 
+
+ 
+ Profit/(Loss)
+ from operations 
+ (344,093) 
+ 8,119,825 
+
+ 
+ 
+ 
+ 
+
+ 
+ Other income/(expenses): 
+ 
+ 
+
+ 
+ Interest income 
+ 441 
+ 22,995 
+
+ 
+ Finance costs 
+ (179,651) 
+ (246,262)
+
+ 
+ Other
+ income 
+ 40,520 
+ 180,663 
+
+ 
+ Total
+ other income/(expenses), net 
+ (138,690) 
+ (42,604)
+
+ 
+ 
+ 
+ 
+
+ 
+ Profit/(Loss)
+ before income taxes 
+ (482,783) 
+ 8,077,221 
+
+ 
+ 
+ 
+ 
+
+ 
+ Income
+ tax expense 
+ - 
+ (988,347)
+
+ 
+ 
+ 
+ 
+
+ 
+ NET
+ PROFIT/(LOSS) 
+ $(482,783) 
+ $7,088,874 
+
+ 
+ 
+
+The
+following table summarizes our cash flows for the years ended March 31, 2023 and 2024:
+
+ 
+
+ 
+ 
+ Year
+ ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Net cash provided
+ by/(used in) operating activities 
+ $(239,813) 
+ $8,281,946 
+
+ 
+ Net cash provided by/(used
+ in) investing activities 
+ 441 
+ (110,860)
+
+ 
+ Net
+ cash provided by/(used in) financing activities 
+ 232,338 
+ (4,682,217)
+
+ 
+ Net change in cash and
+ cash equivalent 
+ (7,034) 
+ 3,488,869 
+
+ 
+ BEGINNING
+ OF YEAR 
+ 335,248 
+ 328,214 
+
+ 
+ END
+ OF YEAR 
+ $328,214 
+ $3,817,083 
+
+ 
+
+ 
+
+ -16-
+
+ 
+
+ 
+
+ 
+
+RISK
+FACTORS
+
+ 
+
+Investing
+in our Class A Ordinary Shares is highly speculative and involves a significant degree of risk. You should carefully consider the following
+risks, as well as other information contained in this prospectus, before making an investment in our Company. The risks discussed below
+could materially and adversely affect our business, prospects, financial condition, results of operations, cash flows, ability to pay
+dividends and the trading price of our Class A Ordinary Shares. Additional risks and uncertainties not currently known to us or that we
+currently deem to be immaterial may also materially and adversely affect our business, prospects, financial condition, results of operations,
+cash flows and ability to pay dividends, and you may lose all or part of your investment.
+
+ 
+
+Risks
+Relating to Our Business and Industry
+
+ 
+
+We
+are transitioning into a new business model which makes it difficult to evaluate our prospects and future financial results, and our
+past growth rate, revenue and net profit margin may not be indicative of our future growth rate, revenue and net profit margin.
+
+ 
+
+During
+the COVID-19 pandemic, most of the in-person events were rescheduled, postponed or cancelled and our business relied on
+the design and/or sale of merchandise and government subsidies. When things started to normalize after the COVID-19 pandemic,
+our business primarily focused on event management business again. During the six months ended September 30, 2024, we started
+to be an event organizer for events. Our net revenue increased by approximately 722% from approximately HK$3.8 million for the six months
+ended September 30, 2023 to approximately HK$31.0 million for the six months ended September 30, 2024, and our net revenue increased
+by approximately 465% from approximately HK$3.6 million for the fiscal year ended March 31, 2023 to approximately HK$20.4 million for
+the fiscal year ended March 31, 2024. For the six months ended September 30, 2023 and 2024, our net revenue increased by approximately
+722% from approximately HK$3.8 million to approximately HK$31.0 million. We acted as a pure service provider for all the experience events
+we organized in the fiscal year ended March 31, 2024. Beginning in April 2024, we have mainly engaged in direct investment deals for
+experience events where we became the effective investor or co-investor of the experience events that we organized, planned, promoted
+and managed. In the long run, we plan to leverage our industry experience and our connections with IP owners built up over the years
+to start obtaining IP licenses from IP owners directly. This will move us up the value chain to become an event organizer, and we believe
+that will help us increase our market share in the events industry in Hong Kong as well as our profitability in the long run.
+
+ 
+
+There
+is no assurance that we will continue to grow at the rate we experienced in the fiscal years ended March 31, 2023 and 2024 and the
+six months ended September 30, 2024, either in terms of revenue or profit, and we may not be successful in maintaining or increasing
+overall profitability or generate positive cash flow going forward. Expansion of our business requires capital commitments and could
+divert management resources away from our current business. There is no assurance that we can successfully implement our growth strategies
+or do so without straining our management resources. There is also no assurance that we can capture a larger market or increase our profitability
+in the future. If we are unable to implement our growth strategies successfully, our results of operations and prospects may be materially
+and adversely affected.
+
+ 
+
+There
+is an inherent risk in using historical financial information to project or estimate our financial performance in the future, as it only
+reflects our past performance under particular conditions, especially the fluctuations during the unprecedented COVID-19 pandemic.
+We may be unable to sustain our historical growth rate, revenue and net profit margin for various reasons, such as deterioration
+in the market conditions in the countries in which the experience events will be held, intensification of competition among the event
+organizers for IP licenses and among the event planners for securing event management contracts, inflation, high unemployment and other
+unforeseen factors which may affect the spending habits of the target audience of the experience events and hence reduce the number of
+event management contracts awarded to us and/or reduce the fees payable to us under the event management contracts. There is no assurance
+that we will be able to achieve the performance we previously did. Moreover, the transition into a new business model may make it even
+more difficult to evaluate our prospects and future financial results. Investors should not solely rely on our historical financial information
+as an indication of our future financial or operating performance.
+
+ 
+
+ -17-
+
+ 
+
+ 
+
+ 
+
+Our
+business strategies and growth plans may not be eventually successful.
+
+ 
+
+The
+successful implementation of our business strategies and growth plans depends on a number of factors including our ability in securing
+the multi-territory IP licenses, general market conditions, the availability of funds, competition, government policies and our ability
+to retain and recruit competent employees. There is no assurance that our business strategies and growth plans can be implemented effectively
+and successfully as some of these factors are beyond our control. If any implementation of these strategies and plans fails or is delayed,
+we may be adversely affected by (i) investment expenses that have not led to the anticipated results; (ii) the distraction of management
+from our core business; and/or (iii) damage to our brand or reputation. Moreover, if we fail to secure adequate funds in a timely manner,
+we may also be unable to pursue opportunities to expand our business. All these could adversely affect our business, results of operations
+and financial condition.
+
+ 
+
+The
+loss of one or more of our major customers or our failure to secure new customers may adversely affect our business, results of operations
+and financial condition.
+
+ 
+
+Prior
+to our engagement in direct investment deals, our customers were generally event organizers and other enterprises and individuals based
+in Hong Kong that engage in event organization and trading activities. Since April 2024, we mainly engaged in direct investment deals
+and our customers were generally sponsors of the experience events we organized and individual event attendees in the countries for which
+the experience events were held. Our top three major
+customers (excluding individual event attendees) contributed approximately 89.6%, 88.8% and 58.5% of our net
+revenue during the fiscal years ended March 31, 2023 and 2024 and the six months ended September 30, 2024, respectively, and
+our largest customer accounted for approximately 66.4%, 66.5% and 30.1% of our net revenue for the same periods.
+We may continue to derive a significant portion of our revenue from some of these major customers in the foreseeable future. However,
+we have not signed any long-term contracts with these major customers and cannot assure you that these customers will continue to engage
+us for our event management, design and/or merchandising services, and on at least comparable scales and terms. Our major customers are
+not obligated to give us any new business or at comparable scale or on terms which they historically have done. Moreover, we may lose
+customers for a variety of reasons, including the decision of the customers to commence bankruptcy proceedings due to financial difficulty
+or acquisitions of our customers by unrelated third parties leading to cancellation of our contracts with those customers or by the acquiring
+companies. If any of our major customers ceases to engage us or terminate their respective contract(s) with us, we may be unable to timely
+identify new customers for new contracts to make up for the lost contracts. Even if new contracts are obtained, they may not be on comparable
+or better commercial terms, and our business prospects and results of operations may be adversely affected.
+
+ 
+
+Our
+ability to obtain new business from our customers and to maintain good business relationship with them is subject to the stability of
+their operations and to their business strategies, both of which are beyond our control and our ability to predict. If our existing customers
+decide to change their business strategies, such as downsizing their business or suspending or ceasing their development or expansion
+plans due to changes in end consumer spending habits, market conditions, business strategies or performance, their demand for our event
+management, design and/or merchandising services may fall or they may switch to only working with service providers that are willing
+to offer highly competitive quotations or a longer payment period or to accept commercially less favorable terms. Even if we are prepared
+to match the terms of our competitors, there is still no assurance that we will be awarded with the service contract, and hence we cannot
+guarantee that there will be sufficient new and sizeable event management, design and/or merchandising service contracts in our pipeline
+to sustain our business and maintain or improve our current results of operations and financial condition. Any failure to obtain new
+contracts from our customers or a significant decrease in the value of the new contracts and/or our customers significant delay
+in or failure to make payments to us could lead to loss of revenue and/or affect our liquidity and thus affect our business adversely.
+Accordingly, if we are unable to obtain business from new customers to diversify our customer portfolio, our business, results of operations
+and financial condition may be adversely affected.
+
+ 
+
+ -18-
+
+ 
+
+ 
+
+ 
+
+We
+have also been relying on customer referrals and/or word-of-mouth to promote our event management, design and/or merchandising services.
+As such, the loss of our major customers may also affect our ability to obtain new customers. A decrease in the number of our existing
+and potential customers could have a significant negative impact on our business prospects and reputation, which in turn will adversely
+affect our business, results of operations and financial condition.
+
+ 
+
+We
+may face revenue concentration risk due to reliance on a single key customer.
+
+ 
+
+For
+the fiscal years ended March 31, 2023 and 2024 and the six months ended September 30, 2024, our largest customer accounted for
+approximately 66.4%, 66.5% and 30.1% of our net revenue, respectively. Our financial stability is significantly
+dependent on a single customer, and any adverse changes in the relationship or business activities with this key customer could have
+a substantial negative impact on our revenue and overall financial performance. A loss of this customer or a reduction in their purchases
+could result in a material decline in our revenue, profitability, and cash flow, leading to increased business risk and potential financial
+instability. We may also be unable to replace this customer in a timely manner or at all. If this customer reduces its purchases or orders
+from us, we may not be able to find other customers to increase their purchases and utilize our service capacity efficiently.
+
+ 
+
+We
+depend on our management team, particularly Ms. Seto, and our ability to retain them and attract additional qualified personnel is critical
+to our success and our growth prospects.
+
+ 
+
+Our
+business operations depend on the continuing services of our management team, particularly Ms. Seto, our founder, director and chief
+executive officer, who has over eight years of experience in the events industry and is instrumental in steering us through the challenging
+times during the COVID-19 pandemic and our timely recovery and growth after it. Ms. Seto s business connections with a wide range
+of industry players have enabled us to provide our event management, design and merchandising services to our customers in a cost-effective
+and efficient manner, which in turn has helped us retain customers and attract new customers. We also rely on Ms. Seto s business
+connections to implement our growth plans. Apart from Ms. Seto, we also depend on Ms. Tse Sze Man, a director and the head of the design
+and merchandising department, Mr. Leung Tak Shun, who will begin serving as our chief financial officer immediately upon the SEC s declaration of effectiveness of our registration statement on Form F-1,
+of which this prospectus forms a part, and Mr. Luk Kai
+Chung, the general manager, who collectively possesses expertise across event management, design, sourcing, logistics, marketing, budget
+control, customer service, accounting and financial management.
+
+ 
+
+While
+we have provided different incentives to our management team, we cannot assure you that we can continue to retain their services. If
+one or more members of our management team were unable or unwilling to continue in their present positions, we may be unable to replace
+them easily or at all, our future growth may be constrained, our business may be severely disrupted and our results of operations and
+financial condition may be materially and adversely affected, and we may incur additional expenses to recruit, train and retain qualified
+personnel. If any dispute arises between us and our current or former directors, we may have to incur substantial costs and expenses
+in order to enforce such agreements or we may be unable to enforce them at all.
+
+ 
+
+The
+management of our existing operations, the expansion of our customer base and our future growth will depend on our ability to continue
+to identify, hire, train and retain experienced and qualified employees. We may be unable to continue to hire or retain key management
+personnel and other experienced and qualified employees and this could adversely impact our operations and growth.
+
+ 
+
+ -19-
+
+ 
+
+ 
+
+ 
+
+Our
+business is substantially dependent upon the continued strength of the market for experience events.
+
+ 
+
+After
+the COVID-19 pandemic, we have redirected our business focus on the organization, planning, promotion and management of
+experience events in Hong Kong and select countries in Southeast Asia again, and we expect to derive most of our revenue from the organization,
+planning, promotion and management of these experience events in the foreseeable future. As a result, continued widespread market acceptance
+and popularity of experience events in Hong Kong and Southeast Asia are critical to our future growth and success. Moreover, competitive
+dynamics may cause pricing levels of IP licenses to change due to the level of market demand, which in turn may affect the bottom line
+of the event organizers and hence the level of fees which they are willing to pay for our event management, design and/or merchandising
+services in cases where we are engaged as an event planner or our profitability in the direct investment deals which we have signed.
+In addition, if the market has an influx of new market participants, we may be forced to reduce the prices we charge for our services
+and products and maybe unable to obtain new contracts at the same prices and upon the same terms that we have historically. If
+the market for experience events stops growing, grows more slowly than we currently anticipate or evolves and forces us to reduce the
+prices we charge for our services, our revenue, gross margin and other operating results could be materially adversely affected.
+
+ 
+
+Our
+business and results of operations may be adversely affected if we are unable to capture, predict or respond timely to our customers 
+and/or their end consumers needs and preferences or keep up with market trend for experience events and merchandise. 
+
+ 
+
+We
+offer a comprehensive spectrum of event management, design and merchandising services in Hong Kong. Our directors believe that our success
+is, to a significant extent, attributable to our ability to understand the respective markets of our customers and provide event management,
+design and/or merchandising services that suit our customers needs and/or ultimately the appetites of their end consumers.
+As interest and taste are subjective matters, the market trend for events and merchandise keeps changing, we may be unable to capture
+or predict the future trend for events and merchandise and continue to develop/design events and/or merchandise that appeal to our customers
+and/or their end consumers. If we fail to (i) capture, predict or respond timely to our customers and/or their end consumers 
+needs and preferences; or (ii) develop/design appealing and commercially viable events and/or merchandise that keep up with market trend
+in a timely manner, our business and results of operations may be adversely affected.
+
+ 
+
+In
+particular, we started to mainly engage in direct investment deals for experience events beginning in April 2024, when we became the
+effective investor or co-investor of the experience events that we organized, planned, promoted and managed. In the long run, we
+plan to leverage our industry experience and our connections with IP owners built up over the years to start obtaining IP licenses from
+IP owners directly which will move us up the value chain to become an event organizer. We believe these strategic changes will
+help us increase our market share in the events industry in Hong Kong as well as our profitability. However, if we fail to keep up with
+the market trend for experience events and merchandise and the markets for experience events and merchandise fail to grow as expected
+our investments in experience events may not generate expected returns, which could adversely affect our business, results of operations
+and financial condition.
+
+ 
+
+ -20-
+
+ 
+
+ 
+
+ 
+
+We
+rely on event organizers.
+
+ 
+
+We
+are an event management service provider that specializes in the organization, planning, promotion and management of experience events.
+We rely on event organizers to appoint us as their event planner to assist them with the organization, planning, promotion and management
+of experience events or to feed us with direct investment deals in experience events. There is no assurance that we will continue to
+maintain good business relationships with event organizers, or the event organizers will not take over the role of an event planner themselves.
+As a significant portion of our revenue was generated from experience events after the COVID-19 pandemic, any deterioration of our relationship
+with event organizers or the event organizers stop feeding experience event deals to us for any reason, will adversely affect our business,
+results of operations and financial condition.
+
+ 
+
+Fluctuations
+in consumer spending caused by social, economic, political and legal developments or instability, as well as any changes in government
+policies, in Hong Kong and other Southeast Asian countries could materially and adversely affect our business, results of operations,
+financial condition and business prospects.
+
+ 
+
+We
+provide event management, design and/or merchandising services to our customers and we specialize in the organization, planning, promotion
+and management of experience events. Our business
+operations are located in Hong Kong and most of our customers, in particular the ones which are event organizers, are based in
+Hong Kong. Our major event organizer customers generally acquire multi-territory IP licenses for experience events that cover
+Hong Kong and different countries in Southeast Asia. Our customers decisions to engage us for our event management, design and/or
+merchandising services and the extent of their engagement and/or the direct investment deals which they might extend to us, will
+be heavily influenced by the likely spending habits of their end consumers (such as event attendees), which in turn will be influenced
+by macroeconomic conditions in their country of residence. Therefore, our business, results of operations, financial condition and business
+prospects are significantly exposed to the social, economic, political and legal developments in Hong Kong and other Southeast Asian
+countries. Uncertainties in these areas include, but are not limited to, the risks of war, regional conflicts, terrorism, extremism,
+nationalism, nullification of contracts, changes in interest rates, inflation, imposition of capital controls, foreign ownership restrictions
+and international sanctions, changes in government policies or introduction of new rules or regulations concerning the events industry
+(such as new sanctions and boycotts) as well as methods of taxation. In particular, events with adverse impact on investors confidence
+and risk appetites, such as general deterioration of the economy in Hong Kong and other Southeast Asian countries, mass civil disobedience
+movements (such as strikes and industrial actions), significant fluctuations in the stock exchange, deterioration of political relations
+or tightening of foreign investment may lead to an economic downturn in Hong Kong and other Southeast Asian countries, slowing down all
+sorts of economic activities in general which in turn may adversely affect the spending habits of the end consumers and hence our customers 
+decision in spending on new IP licenses, experience events and/or other events and merchandises which directly affect their
+decision to engage us for our event management, design and/or merchandising services and/or to extend direct investment deals to us.
+If there were a drastic decrease in the service contracts or direct investment deals from our customers in these markets or
+they put greater pricing pressure on us, there is no assurance that we will be able to respond quickly to develop new markets to make
+up for the loss in service contracts or direct investment deals or to pass on the pricing pressure to our suppliers or the
+end consumers. All these will adversely affect our business, results of operations, financial condition and business prospects.
+
+ 
+
+As
+open economies, the domestic economies of Hong Kong and other Southeast Asian countries are affected by many other unpredictable factors
+such as global economic, social, legal and political developments and changes in local and international economic and political situations.
+There is no assurance that any changes in the existing government policies, economic, social and political conditions and the business
+environment in Hong Kong and other Southeast Asian countries in the future, some of which are beyond our control (such as natural disasters,
+pandemics/epidemics like the outbreak of the COVID-19 pandemic, severe acute respiratory syndrome, the H5N1 strain of avian
+influenza and the H1N1 strain of swine flu, acts of God and other disasters), will not have a negative effect on the spending habits
+of the end consumers and hence our customers decisions to reduce or defer their spending on new IP licenses, experience
+events and/or other events and merchandises which directly affect our business prospects. Specifically, our business and results
+of operations could be materially and adversely affected by changes in laws and regulations concerning the events industry, foreign trade,
+taxation and ownership and expropriation of property, as well as environmental or health and safety matters, in Hong Kong and other Southeast
+Asian countries.
+
+ 
+
+ -21-
+
+ 
+
+ 
+
+ 
+
+The
+future growth and level of profitability of the IP license sector of the events industry in Hong Kong and other Southeast Asian countries
+depend primarily upon consumer spending as well as the development of the market for IP license events in Hong Kong and other Southeast
+Asian countries, the nature, extent and timing of which will be determined by the interplay of a variety of factors, in particular, the
+investments of event organizers as well as the general conditions and prospects of the local economies. Economic changes as well as cultural,
+lifestyle, demographics and population changes may affect the demand for IP license events in Hong Kong and other Southeast Asian countries,
+and hence the business strategies of our customers which in turn will affect our business prospects and results of operations. There
+are also many other factors affecting the IP license sector of the events industry in Hong Kong and other Southeast Asian countries,
+including (i) general political, economic, financial and social developments in Hong Kong and other Southeast Asian countries; (ii) inflation;
+(iii) unemployment rate; (iv) fluctuations in interest rates; (iv) local government policies; and (vi) cyclical trends of the regional
+and global economies. If the IP license sector of the events industry in Hong Kong and other Southeast Asian countries declines for any
+reason, our business, results of operations, financial condition and future prospects could be adversely affected.
+
+ 
+
+We
+provide event management, design and/or merchandising services to our customers on a project-by-project basis, which exposes us to the
+risk of uncertainty and potential volatility with respect to our revenue.
+
+ 
+
+We
+provide event management, design and/or merchandising services to our customers on a project-by-project basis and this is not recurring
+in nature. As such, we cannot guarantee that our customers will continue to engage us for our event management, design and/or merchandising
+services or continue to provide us with new businesses. In general, we do not have long-term contracts with our customers which provide
+that they will deploy our services for all their event management, design and/or merchandising needs, which create uncertainty to our
+future revenue streams. Our business and future revenue will likely be adversely affected if we are unable to secure new service contracts
+from new customers or our existing customers do not continue to engage us.
+
+ 
+
+It
+is also difficult to forecast future businesses from our customers as it depends on their investment decisions. We provide customized
+event management, design and/or merchandising services to meet the specific needs of our customers on a project-by-project basis. The
+contract sum is determined by various factors including estimated event execution time costs, complexity of the event and the third-party
+costs we incurred which will not be reimbursed by our customers. As such, the revenue generated from each customer is different for each
+contract. We cannot assure you that we can secure future service contracts with contract sum comparable with the service contracts we
+worked on during the fiscal years ended March 31, 2023 and 2024 and the six months ended September 30, 2024. The sustainability
+of our financial performance, including the number of projects undertaken, the total revenue contributed from the projects and revenue
+from each customer, is uncertain. Our financial performance may therefore fluctuate from year to year, and can be unpredictable.
+
+ 
+
+ -22-
+
+ 
+
+ 
+
+ 
+
+We
+typically enter into fixed-price service contracts with our customers, and our failure to accurately estimate the resources
+and time required to perform these contracts could materially and adversely affect our business, results of operations and financial
+condition.
+
+ 
+
+We
+typically enter into fixed-price service contracts with our customers for our event management, design and/or merchandising services,
+which requires us to accurately estimate the resources and time required in performing these contracts, such as manpower required and
+costs of other service providers, such as local facilitator and human resources companies supplying the temporary workers. As such, we
+have to bear the risk of cost overruns. There may be various factors affecting the actual time taken and cost incurred by us in completing
+the service contracts, including, among others, the event organizer rescheduling the events, delay in supply of products and services
+by third-party vendors, technical difficulties, lack of manpower and other unforeseeable problems and circumstances. Delay in completion
+or cost overruns may result in lower profits or losses in these contracts. We cannot assure you that we will be able to accurately estimate
+the resources and time required for completing our service contracts, and failure to do so may materially and adversely affect
+our business, results of operations and financial condition.
+
+ 
+
+Our
+success depends on our ability to maintain our reputation and our business and financial results may be harmed if events occur that damage
+our reputation.
+
+ 
+
+Our
+business, results of operations and prospects depend, in part, on our ability to maintain the value of our reputation for providing customized,
+value-added, quality and efficient event management, design and/or merchandising services. We could lose existing or potential customers
+and/or opportunities for securing new service contracts or direct investment deals if our reputation were to be associated with
+any negative publicity, including complaints raised by unsatisfied customers or their end consumers that comes to the public s
+attention and accidents occurred in the experience events that we managed. If we fail to successfully maintain, promote and position
+our brand and protect our reputation, our business, results of operations and financial condition may be adversely affected.
+
+ 
+
+We
+operate in a competitive market.
+
+ 
+
+The
+events industry in Hong Kong is highly fragmented and intensely competitive. It is characterized by constant change and innovation as
+customers or end consumers are demanding event management companies to create deeper and more meaningful event experiences that
+leave lasting impressions. We specialize in organizing, planning, promoting and managing experience events. It is a niche sector of the
+events industry as it requires the players to have an in-depth knowledge on the operation of IP licenses and experience in working with
+IP owners. Our biggest competition comes from local event management companies that are experienced in organizing big scale public events
+that involve IP licenses. Furthermore, we may face potential competition from global event management companies that seek to enter the
+Hong Kong market, whether independently or through the formation of strategic alliances with, or acquisition of, event management companies
+that operate in the Hong Kong market. We believe the principal competitive factors in our market include breadth and depth of the scope
+of services, pricing, user experience, financial viability, industry expertise and reputation, proven customer references, track record
+as well as relationship with other industry players (such as IP owners, venue operators and overseas event management companies). Some
+of our competitors and potential competitors may be larger and have more manpower and resources, longer operating histories, more financial
+strength, stronger relationships with customers and higher level of market recognition than we have. As a result, our competitors may
+be able to respond more quickly and effectively than we can to new or changing opportunities, trends, customer and/or end consumer
+demands, industry standards and regulatory requirements. When we provide quotation on our event management, design and/or merchandising
+services for our customers, we may face keen competition and significant downward pricing pressure, thereby reducing our profit margins,
+which will have an adverse effect on our results of operations and profitability. If we fail to adapt to market conditions and customer
+and/or end consumer preferences expediently or otherwise fail to provide a competitive quotation as compared to our competitors,
+our potential customer may turn to our competitors. As a result, our customer base may decrease, which could materially and adversely
+affect our business, results of operations and financial condition. To increase our competitiveness, we may be required to divert additional
+resources to promote our event management, design and/or merchandising services and brand awareness, and such additional spending could
+adversely affect our profitability.
+
+ 
+
+ -23-
+
+ 
+
+ 
+
+ 
+
+A
+shift in our customers business model may adversely affect our business, results of operations and financial condition.
+
+ 
+
+The
+events industry was transformed by the COVID-19 pandemic, which forced events into virtual environments and accelerated the ongoing
+digital transformation of the events industry. For virtual events, the technology behind the virtual event is the event venue, video
+is the primary method of content delivery and virtual attendees create a digital footprint of all of their event engagement that can
+be captured, analyzed and leveraged to deliver better event experiences and inform subsequent sales and marketing efforts. Even as the
+COVID-19 pandemic has subsided, we believe virtual events will remain popular due to their ability to attract and engage vast
+audiences across the globe. In our current business model, we specialize in the organization of in-person events as an event
+planner only. If our customers shift their event delivery models from an in-person mode to a virtual mode, it will reduce their need
+for our event management services, which will have a material adverse impact on our business, results of operations and financial condition.
+Even if our customers continue to organize in-person events, our business, results of operations and financial condition will also be
+adversely affected if they decide to eliminate the role of the event planner and take over all the responsibilities themselves.
+
+ 
+
+Our
+operating margin may decline as a result of increasing cost of revenue and other indirect costs.
+
+ 
+
+Our
+cost of revenue is mainly comprised of costs of goods sold, sub-contracting fee including costs of local facilitator, PR firms, contractors
+and temporary workers and project-related employee benefit expenses. Other indirect costs include office expenses, staff costs, insurance
+expenses and bank charges. Indirect costs are affected by, among other things, increase in overhead costs for administration purposes
+and rising interest rates. If labor costs and/or the other indirect costs increase, the local facilitator, human resources companies
+supplying the temporary workers and the manufacturers may pass on the increase in their costs to us by increasing their fees.
+
+ 
+
+Our
+cost of revenue and other indirect costs mentioned above are subject to increase by other factors that are generally unpredictable and
+beyond our control or the control of our vendors. If these costs continue to rise and we fail to pass on the increases to our customers
+or end consumers, our business may be materially and adversely affected.
+
+ 
+
+ -24-
+
+ 
+
+ 
+
+ 
+
+We
+may incur losses in the future.
+
+ 
+
+We
+had a net loss of approximately HK$0.5 million and a net profit of approximately HK$7.1 million and HK$2.7 million, respectively,
+for the fiscal years ended March 31, 2023 and 2024 and the six months ended September 30, 2024. Beginning in April 2024, we have
+mainly engaged in direct investment deals for experience events, and we endeavor to obtain multi-territorial IP licenses from IP owners
+to help us increase our market share in Hong Kong and further develop overseas markets. As a result of these changes to our business
+strategy, we anticipate that our operating expenses will increase in the foreseeable future as we seek to sign more direct investment
+deals, acquire IP licenses directly from IP owners, maintain and continue to grow our business, attract new customers and further
+enhance our services. These efforts may prove more expensive than we currently anticipate, and we may not succeed in increasing our revenue
+sufficiently to offset these higher operating expenses. As a result of the foregoing and other factors, we may incur net losses in the
+future and may be unable to achieve or maintain profitability on a quarterly or annual basis in the foreseeable future.
+
+ 
+
+There
+is no guarantee that we will receive payments from our customers in full on time or at all.
+
+ 
+
+We
+generally require the customers which engage our event management, design and/or merchandising services to pay us by two
+non-refundable instalments, one shortly after the signing of the service contracts and the other shortly before the opening of
+the event or delivery of the final design work or finished merchandise (as the case may be). There is no assurance that our customers
+will remain solvent or that our customers will pay us the amount due in full in a timely manner or at all. We could be engaged in prolonged
+negotiation with our customers with respect to the settlement of payments and could incur costs to enforce such payments from time to
+time. Any failure by our customers to make any payment on time may have a material adverse effect on our liquidity and any failure by
+our customers to pay us in full may have a material adverse effect on our business, results of operations and financial condition.
+
+ 
+
+Errors,
+defects, interruptions or any other malfunction or safety issues causing disruption to the events we organize could diminish
+demand for our event management, design and/or merchandising services.
+
+ 
+
+Our
+customers rely on our event management, design and/or merchandising services for the smooth running of their events. Any errors, defects,
+interruptions or any other malfunction or safety issues that arise during our organization, planning, promotion and management of our
+customers events or the events which we have invested causing disruption to such events could (i) harm the business of
+our customers or our business, and we may face claims from our customers and/or end consumers for the losses they suffer; and
+(ii) affect our market reputation, which may diminish customers demand for our event management, design and/or merchandising services
+and/or put us in an inferior position in future competition for new service contracts or direct investment deals. We may also
+have to divert significant resources to (a) fix such errors, defects, interruptions or any other malfunction or safety issues and to
+ensure the events will continue to run smoothly; (b) rebuild confidence in our event management, design and/or merchandising services
+and our brand image; and (c) defend ourselves in or settle any potential legal claims. All these could adversely affect our reputation,
+business, results of operations and financial condition.
+
+ 
+
+ -25-
+
+ 
+
+ 
+
+ 
+
+We
+depend on third-party vendors to assist us with the organization, planning, promotion and/or management of events. 
+
+ 
+
+We
+depend on local facilitators to assist us with the organization, planning, promotion and management of events outside of Hong Kong and
+human resources companies to supply us with temporary workers to assist us in the management of events in Hong Kong. We have not entered
+into any long-term contract with these third-party vendors and hence we do not have a guaranteed supply of these services. If any of
+these vendors were to cease, suspend or limit their services provided to us, or adversely modify supply terms or pricing, our ability
+to provide our event management services may be materially impaired. We cannot assure you that we will be able to obtain these services
+or acceptable substitutes from alternative vendors on commercially reasonable terms or at all. Moreover, the services provided by the
+local facilitators and the temporary workers supplied by the human resources companies in Hong Kong may be ineffective, all of which
+may adversely affect our ability to fulfill our contractual commitments to our customers. If we deliver substandard services to our customers,
+our customers may reduce our fees, terminate our service contracts or stop using our services in the future. They may also initiate legal
+proceedings against us. All these may increase our costs and damage our market reputation, which in turn may adversely affect our business,
+results of operations and financial condition.
+
+ 
+
+We
+are dependent on third-party manufacturers for the production of merchandise, and any disruption to our relationship or their manufacturing
+operations could adversely affect our merchandising services.
+
+ 
+
+All
+of the merchandise we sourced for our customers during the fiscal years ended March 31, 2023 and 2024 and the six months ended September
+30, 2024 were produced by third-party manufacturers located in the PRC. As such, we rely heavily on the ability and efficiency of
+third-party manufacturers to produce merchandise for our customers and third-party manufacturers play a vital role in our merchandising
+services. We do not enter into any long-term contracts with third-party manufacturers and purchase contracts are signed with them on
+a case-by-case basis depending on the needs and requirements of our customers. There is no assurance that all or any of the third-party
+manufacturers that we have worked with during the fiscal years ended March 31, 2023 and 2024 and the six months ended September 30,
+2024 will continue to produce merchandise for us at our desired quality and quantity, in a timely manner and on terms commercially
+acceptable to us. Any disruption to such third-party manufacturers production may inevitably have an impact on their ability to
+produce the merchandise in line with our required schedule. If any of such third-party manufacturers terminates its business relationship
+with us for any reason or if there were changes to the current business arrangements, we may be unable to source suitable and stable
+supply of merchandise from comparable alternative third-party manufacturers in a timely manner or on terms commercially acceptable to
+us. Any of the above may result in production delay which would adversely affect our ability to fulfil our customers orders and
+may result in our customers cancelling their sales orders with us or cause serious disruption to our customers business (for instance,
+merchandise sales account for a significant amount of revenue for an experience event). All these will in turn adversely affect our sales
+and profitability as well as our reputation and business prospects.
+
+ 
+
+Moreover,
+as we do not enter into any long-term contracts with the third-party manufacturers, the contractual terms offered by them may also be
+susceptible to fluctuations with regard to pricing, timing, quality and the market condition at the time of negotiation. Any increase
+in their costs may be passed on to us but we might be unable to pass on all or part of the increase in costs to our customers, which
+may have a material adverse effect on our financial performance.
+
+ 
+
+We
+rely on a limited number of key suppliers.
+
+ 
+
+We
+face risks due to a high concentration of suppliers, where a significant portion of our supply chain relies on a limited number of key
+suppliers. For the fiscal years ended March 31, 2023 and 2024 and the six months ended September 30, 2024 (excluding in-house staffs),
+cost of goods sold attributed to our five largest suppliers accounted for approximately 85.0%, 78.9% and 68.3% of our
+total cost of goods sold. Any disruptions, quality issues, pricing fluctuations, or operational difficulties with these suppliers could
+adversely affect our ability to source necessary materials or services, resulting in production delays, increased costs, or potential
+supply chain interruptions. Such dependencies expose us to risks of supply shortages, pricing volatility, and operational challenges,
+which could impact our financial performance and competitive position.
+
+ 
+
+ -26-
+
+ 
+
+ 
+
+ 
+
+We
+may be exposed to IP infringement claims by third parties against IP owners, event organizers, ourselves and/or any other sub-licensees
+and if we fail to defend such claims, they could subject us to significant liabilities and other costs, and we may not be allowed to
+continue to use certain of the IP rights.
+
+ 
+
+We
+specialize in organizing, planning, promoting and managing experience events, which typically involve IP owners granting event organizers
+(which are either our customers under service contracts or our licensors under direct investment deals) IP licenses of the
+licensed property for use in experience events in approved venues in a specified number of territories. Our success depends largely on
+our ability to use the licensed property to develop, organize, plan, promote and manage experience events without infringing the IP rights
+of third parties. We cannot assure you that third parties will not assert IP claims against the IP owners, event organizers, ourselves
+and/or any other sub-licensees during the course of the development, organization, planning, promotion and management of experience events.
+The validity and scope of those claims relating to the IP rights of the licensed property involve complex legal and factual questions
+and analysis, which can be uncertain and ambiguous. If third parties assert claims against the IP owners, event organizers, ourselves
+and/or any other sub-licensees for IP rights infringement, the IP owners, event organizers, ourselves and/or any other sub-licensees
+may need to defend the claims through legal proceedings, which can be both costly and time consuming and may significantly divert the
+efforts and resources of our management personnel in defending against these third-party infringement claims, regardless of the merits.
+If the IP owners, event organizers, ourselves and/or any other sub-licensees fail to successfully defend such claims, we may be
+exposed to substantial liabilities to third parties and/or our customers and subject us to injunctions prohibiting the exploitation of
+the relevant licensed property, which may materially and adversely affect our business, results of operations and financial condition.
+Any infringement claim, whether with merits or not, may generate negative publicity which could harm our reputation.
+
+ 
+
+If
+we are unable to protect the IP owners IP rights in the licensed property effectively, our business and reputation could suffer.
+
+ 
+
+To
+protect their IP rights in the licensed property, the IP owners normally have very specific guidelines on the use of the licensed property,
+and we normally have to seek the IP owners prior approval on all proposed uses of the licensed property, which can be granted
+or rejected at the absolute discretion of the IP owners. We are also required to include appropriate copyright and trademark notices
+whenever any licensed property is being incorporated, displayed, exploited or otherwise used, as well as to inform the IP owner immediately
+in cases of any potential infringement of the IP owners IP rights in the licensed property. However, we cannot assure you that
+we will be able to fully comply with the above requirements and that the IP owners IP rights in the licensed property will be
+adequately protected. If we fail to comply with the above requirements or if we are unable to detect unauthorized use of the IP owners 
+IP rights in the licensed property, or to take appropriate or timely steps to inform the IP owners of such unauthorized use, the IP owners
+may disapprove all plans and proposals we submit with respect to the experience events we organize, plan, promote and manage and this
+may harm our business and reputation, which in turn could adversely affect our business, results of operations and financial condition.
+
+ 
+
+ -27-
+
+ 
+
+ 
+
+ 
+
+If
+we are unable to maintain and protect our IP, or if third parties assert that we infringe on their IP rights, our business could suffer.
+
+ 
+
+Our
+business depends, in part, on our ability to identify and protect proprietary information and other IP such as the IP owners licensed
+property, information and business methods, our designs of merchandise and our customer lists. We rely on trade secrets, confidentiality
+policies, non-disclosure and other contractual arrangements and copyright and trademark laws to protect our IP rights. However, we may
+not adequately protect these rights, and their disclosure to, or use by, third parties may harm our competitive position. Our inability
+to detect unauthorized use of, or to take appropriate or timely steps to enforce, our IP rights may harm our business. Also, third parties
+may claim that our business operations infringe on their IP rights. These claims may harm our reputation, be a financial burden to defend,
+distract the attention of our management and prevent us from offering some products and/or services. IP is increasingly stored or carried
+on mobile devices, such as laptop computers, which increases the risk of inadvertent disclosure if the mobile devices are lost or stolen
+and the information has not been adequately safeguarded or encrypted. This also makes it easier for someone with access to our systems,
+or someone who gains unauthorized access, to steal information and use it to our disadvantage.
+
+ 
+
+Any
+failure to maintain an effective quality control system may have a material adverse effect on our reputation, results of operations and
+financial condition.
+
+ 
+
+As
+a merchandising service provider, quality control is a critical part of the supply chain management total solutions we provide to our
+customers. We have a quality control system for our merchandising staff to monitor and inspect the merchandise produced for our customers
+from the time of production of samples, procurement of raw materials to the merchandise being produced during inline production. If there
+is any significant failure or deterioration in our quality control system or if we fail to meet or conform to the required specifications
+of our customers, it may result in product returns and/or customer claims or complaints and we may lose the customer. All these could
+have a material adverse effect on our reputation, results of operations and financial condition.
+
+ 
+
+The
+nature of our business exposes us to product liability claims.
+
+ 
+
+A
+product liability claim attempts to hold the manufacturer or seller of a product accountable for allowing a defective product to enter
+into the stream of commerce. There are three types of defects in merchandise that may result in liability, namely design defects, manufacturing
+defects and defective warnings (which includes the failure to properly instruct a consumer on how to use the product). For instance,
+a merchandise may be flammable and does not meet local safety standards for fire and burn ratings and there is inadequate warning regarding
+flame and fire risks to the end consumers. There is no assurance that we and/or the third-party manufacturers engaged by us will not
+design, develop or manufacture any merchandise for our customers that are defective. If any defective merchandise designed, developed
+or manufactured by us and/or the third-party manufacturers engaged by us are subsequently sold by our customers, we may be exposed to
+product liability claims from our customers and/or their end consumers and we may have to recall all the defective merchandise in the
+market. Even if we managed to recall all the merchandise, or if we defend or settle such claims, our reputation, business, results of
+operations, financial condition and business prospects may be adversely affected.
+
+ 
+
+ -28-
+
+ 
+
+ 
+
+ 
+
+Legal
+disputes or proceedings may expose us to liabilities, divert our management s attention and adversely affect our reputation.
+
+ 
+
+The
+success of an experience event will require the collaboration of several parties, including the IP owner, the event organizer, the event
+planner and other service providers, including without limitation the local facilitator (where applicable), venue operator, contractor,
+public relationship firm, ticketing platforms, caterers, forwarders, logistic companies, and hence the operation of an experience event
+is contract intensive. Although the event organizer is normally the party signing these contracts (save for the contract with the local
+facilitator), we occasionally sign some of these contracts as agent for and on behalf of the event organizer. In any case, as the event
+planner of the experience event, we are responsible for liaising with the various contracting parties and supervising the execution of
+these contracts, and hence might be drawn into disputes between these contracting parties from time to time. In direct investment
+deals, we step into the shoes of the event organizer and we will sign all these contracts ourselves and hence will be directly exposed
+to these disputes. Dealing with these disputes is generally time-consuming and may require us to incur legal fees that may not be
+indemnified by the event organizer. If the resolution of such disputes is in a manner adverse to our interests, that may harm our reputation.
+All these could adversely affect our business, results of operations and financial condition.
+
+ 
+
+In
+any case, during the ordinary course of our business operations, we may be involved in legal disputes or proceedings relating to, among
+other things, IP disputes, contractual disputes and labor disputes. Such legal disputes or proceedings may subject us to substantial
+liabilities and may have a material and adverse effect on our reputation, business, results of operations and financial condition.
+
+ 
+
+If
+we become involved in material or protracted legal proceedings or other legal disputes in the future, we may need to incur substantial
+legal expenses and our management may need to devote significant time and attention to handle such proceedings and disputes, diverting
+their attention from our business operations. In addition, the outcome of such proceedings or disputes may be uncertain and could result
+in settlement or outcomes which may adversely affect our results of operations and financial condition.
+
+ 
+
+Natural
+disasters and other catastrophic events beyond our control could adversely affect our business operations and financial performance.
+
+ 
+
+The
+occurrence of one or more other natural disasters, such as fires, hurricanes, tornados, tsunamis, floods and earthquakes; geo-political
+events, such as civil unrest in a country in which our suppliers are located or terrorist or military activities disrupting transportation,
+communication or utility systems; or other highly disruptive events, such as nuclear accidents, pandemics, unusual weather conditions
+or cyberattacks, could adversely affect our operations and financial performance. The occurrence of these events could result in, among
+other things, operational disruptions, physical damage to or destruction or disruption of one or more of our properties or properties
+used by third parties in connection with the supply of products or services to us, the lack of an adequate workforce in parts or all
+of our operations and communications and transportation disruptions, which in turn could also cause consumer confidence and spending
+to decrease or result in increased volatility in Hong Kong and the Southeast Asian countries in which our customers have invested and
+global financial markets and economy. Such occurrences in the future could have a material adverse effect on us and could also have indirect
+consequences such as increases in the costs of insurance if they result in significant loss of property or other insurable damage.
+
+ 
+
+ -29-
+
+ 
+
+ 
+
+ 
+
+Our
+business and operations may be materially and adversely affected in the event of a resurgence of the COVID-19 pandemic.
+
+ 
+
+The
+events industry around the world, which generally rely on face-to-face experiences to provide more opportunities for deeper engagement,
+networking and interaction, had generally suffered a serious blow during the COVID-19 pandemic, due to measures adopted by the
+respective local governments to stop community spread of the COVID-19 pandemic. There was no exception to us, and we had
+to rely on the design and/or sale of merchandise and government subsidies for our survival. If the COVID-19 pandemic resurges
+and/or new variants of the COVID-19 virus evolve to be more transmissible and virulent than the existing strains, this
+may result in a tightening of restrictions and regulations on businesses which may impact us and our customers and suppliers. If in-person
+events have to be rescheduled, postponed or cancelled or if we or our customers and suppliers are forced to close down our/their businesses
+with prolonged disruptions to our/their operations, we may fail to complete the agreed event management, design and/or merchandising
+services for our customers, experience a delay or shortage of raw materials, supplies and/or services by our suppliers, or termination
+of service contracts by our customers. In addition, if any of our employees are suspected of having contracted the COVID-19 virus,
+some or all of our employees may be quarantined thus causing a shortage of labor and we would be required to disinfect our office
+and event venues. In such event, our operations may be severely disrupted. If there is a resurgence of the COVID-19 pandemic, it
+may have a negative impact on the local, regional and global economy, which will have negative impacts on consumer spending and our customers 
+businesses and hence our businesses will also be affected. All these may have a material and adverse effect on our business, results
+of operations and financial condition.
+
+ 
+
+Our
+current insurance coverage may not sufficiently protect us against all the risks we are exposed to, and the insurance premium may increase.
+
+ 
+
+There
+can be no assurance that our current insurance will cover all our risks or adequately protect us against all liabilities arising from
+claims and litigation against us. We will have to bear any losses, damages or liabilities in the course of our operations arising from
+events for which we do not have adequate insurance coverage. Further, the insurance premium payable by us depends on various factors,
+including the scope and contract sum of the projects undertaken by us and our insurance claim track record. There is no assurance that
+the insurance premium payable by us will not increase or that our insurance coverage will not be reduced in the future. If we were held
+liable for uninsured losses, the amounts of claims for insured losses exceed the limits of our insurance coverage or the insurance premium
+payable by us increases significantly, our business, results of operations and financial condition may be materially and adversely affected.
+
+ 
+
+Our
+business could be adversely affected by information technology systems breakdown or disruption.
+
+ 
+
+We
+depend on our information technology systems to (i) conduct market research; (ii) trace information on the contracts we have
+signed and the contracts signed between our customers and their other service providers; (iii) manage our work schedule; and (iv)
+review our performance. We also depend on our information technology systems to assist us in our (a) designs and drawings; (b) preparation
+of all relevant event proposals and plans; and (c) communication with third parties, such as our customers, the other service
+providers engaged by them and our suppliers. An extended breakdown or failure of our information technology systems could disrupt our
+operations and have an adverse effect on our business, results of operations and financial condition.
+
+ 
+
+ -30-
+
+ 
+
+ 
+
+ 
+
+Fluctuations
+in foreign currency exchange rates may materially and adversely affect our financial condition and results of operations.
+
+ 
+
+We
+are based in Hong Kong while all our suppliers of merchandise are based in the PRC. The brand owners, franchisees, distributors
+and local facilitators which we work with on overseas experience events are generally based overseas, such as in
+Malaysia and Thailand. Our reporting currency is Hong Kong Dollar while a portion of our overseas procurement is denominated in foreign
+currencies, such as Renminbi, Malaysian Ringgits and Thai Baht. As such, we are exposed to foreign currency risk as we trade in
+various foreign currencies. Fluctuations in foreign exchange are unpredictable as they may be caused by various factors, which would
+affect the gains and losses from transactions in currencies other than our reporting currency. We cannot assure you that we will not
+suffer any loss on foreign exchange in the future. Further, we do not have any forward contracts or other derivative instruments to manage
+our foreign exchange risks. In the event that we are unable to manage our foreign currency risks effectively or at all, our business,
+financial condition and results of operations may be materially and adversely affected.
+
+ 
+
+The
+aging population may have an adverse effect on our business, results of operations and financial condition.
+
+ 
+
+We
+specialize in organizing, planning, promoting and managing experience events, which typically involve IP licenses of licensed characters,
+the target audience of which are mainly young children, teenagers and young adults. The aging population in Hong Kong and the other Southeast
+Asia countries may hinder the growth of our business in the long run, as the demand for such experience events may gradually decrease
+due to the drop of birth rate in these countries. As such, a decrease in the size of the target audience together with an aging population
+may result in a decline in the demand for experience events, which may have an adverse effect on our business, results of operations
+and financial condition.
+
+ 
+
+Our
+business may be subject to seasonal effects, which may adversely affect our liquidity and results of operations in certain seasons.
+
+ 
+
+Our
+business generally experiences some effects of seasonal variations. Some of our customers tend to organize events during festive seasons
+such as New Year, Chinese New Year, Easter, Mid-Autumn Festival, Christmas or during the summer vacation, which may result in a fluctuation
+of our revenue. This seasonality factor may cause seasonal fluctuations in our financial results, which may adversely affect our liquidity
+and results of operations in certain seasons.
+
+ 
+
+We
+may need to raise additional capital required to grow our business, and we may be unable to raise capital on terms acceptable to us or
+at all.
+
+ 
+
+Growing
+and operating our business will require significant cash outlays and capital expenditures and commitments. Although our current cash
+and cash equivalents, anticipated cash flows from operating activities and the proceeds from this offering will be sufficient to meet
+our anticipated working capital requirements and capital expenditures in the ordinary course of business for at least 12 months following
+this offering, there is a risk that we may need additional cash resources in the future to fund our growth plans or if we experience
+adverse changes in business conditions or other developments. We may also need additional cash resources in the future if we find and
+wish to pursue opportunities for new investments, acquisitions, capital expenditures or similar actions. If we determine that our cash
+requirements exceed the amount of cash and cash equivalents we have on hand at the time, we will need to seek additional capital, potentially
+through equity or debt financing, to fund our growth. Our ability to access the credit and capital markets in the future as a source
+of liquidity, and the borrowing costs associated with such financing, are dependent upon market conditions. We cannot provide any assurance
+that our assumptions used to estimate our liquidity requirements will remain accurate due to unseen factors such as the recurrence of
+the Pandemic, risks of war and regional conflicts. In the event of a sustained market deterioration, and continued declines in revenues,
+we may need additional liquidity, which would require us to evaluate available alternatives and take appropriate actions. We cannot provide
+any assurance that we will be able to obtain additional sources of financing or liquidity in amounts or on terms acceptable to us, or
+at all. In addition, we have agreed for a period of 180 days after completion of this offering, not to offer, sell, contract to sell,
+pledge, grant any option to purchase, make any short sale or otherwise dispose of, directly or indirectly any shares or any securities
+convertible into or exchangeable for our shares either owned as of the date of the underwriting agreement or thereafter acquired without
+the prior written consent of the underwriter. The existence of this provision may delay or prevent us from raising additional capital
+for the 180-day period following this offering. In addition, any equity securities we issue, including any preferred stock, may be on
+terms that are dilutive or potentially dilutive to our stockholders, and the prices at which new investors would be willing to purchase
+our securities may be lower than the offering price per share of our shares in this offering. The holders of any equity securities we
+issue, including any preferred stock, may also have rights, preferences or privileges which are senior to those of existing holders of
+our shares. If new sources of financing are required, but are insufficient or unavailable, we will be required to modify our growth and
+operating plans based on available funding, if any, which would harm our ability to grow our business.
+
+ 
+
+ -31-
+
+ 
+
+ 
+
+ 
+
+Our
+executive officers have no prior experience in operating a U.S. public company, and their inability to operate the public company aspects
+of our business could harm us.
+
+ 
+
+Our
+executive officers have no experience in operating a U.S. public company, which makes our ability to comply with applicable laws, rules
+and regulations uncertain. Our failure to comply with all laws, rules and regulations applicable to U.S. public companies could subject
+us or our management to regulatory scrutiny or sanction, which could harm our reputation and share price.
+
+ 
+
+If
+we fail to implement and maintain an effective system of internal controls, we may be unable to accurately or timely report our results
+of operations or prevent fraud, and investor confidence and the market price of our Class A Ordinary Shares may be materially and adversely
+affected.
+
+ 
+
+Prior
+to this offering, we were a private company with limited accounting personnel resources. Furthermore, prior to this offering, our management
+has not performed an assessment of the effectiveness of our internal control over financial reporting, and our independent registered
+public accounting firm has not conducted an audit of our internal control over financial reporting. Effective internal control over financial
+reporting is necessary for us to provide reliable financial reports and, together with adequate disclosure controls and procedures, are
+designed to prevent fraud.
+
+ 
+
+Our
+internal controls relating to financial reporting have not kept pace with the expansion of our business. Our financial reporting function
+and system of internal controls may be less developed in certain respects than those of similar companies that operate in Hong Kong and
+may not provide our management with as much or as accurate or timely information. The PCAOB has defined a material weakness as "a
+deficiency, or a combination of deficiencies in internal control over financial reporting, such that there is a reasonable possibility
+that a material misstatement of the annual or interim statements will not be prevented or detected on a timely basis."
+
+ 
+
+Our
+failure to implement and maintain effective internal controls over financial reporting could result in errors in our financial statements
+that could result in a restatement of our financial statements, cause us to fail to meet our reporting obligations and cause investors
+to lose confidence in our reported financial information, which may result in volatility in and a decline in the market price of the
+Class A Ordinary Shares.
+
+ 
+
+During
+the course of the audit of our consolidated financial statements for the years ended March 31, 2023, we and our auditor identified
+the following material weaknesses:
+
+ 
+
+(i)Over-reliance
+ on Ms. Seto for management and approval of transactions. Our auditor recommended appointing
+ a chief financial officer which has been done after March 31, 2024.
+
+ 
+
+(ii)We
+ did not have a dedicated accounting system to maintain accounting records. Our auditor recommended
+ that we subscribe and use a dedicated ERP system or equivalent software. We intend to allocate
+ 10% of the net proceeds from the offering for upgrading our enterprise resource planning
+ system.
+
+ 
+
+(iii)Lack
+ of independent reviews over related party transactions. We had relied on Ms. Seto s
+ instructions to record related party transactions. Following the offering, all related party
+ transactions will be reviewed by the audit committee on a semi-annual basis.
+
+ 
+
+(iv)We
+ had not maintained adequate supporting documents at times. We intend to allocate 15% of the
+ net proceeds from the offering to hire additional staff in the finance department to assist
+ with this going forward.
+
+ 
+
+(v)We
+ did not properly inspect our heads of accounting in relation to our leases, resulting in
+ errors such as right-of-use assets being classified as fixed assets as well as with certain
+ revenue recognition. We have already appointed a chief financial officer and have indicated
+ that we will continue to appoint a qualified audit firm to assist us in reviewing and preparing
+ accounts after the offering.
+
+ 
+
+Upon
+the completion of this offering, we will become a public company in the United States subject to the Sarbanes-Oxley Act of 2002. Section
+404 of the Sarbanes-Oxley Act of 2002, or Section 404, will require that we include a report of management on our internal control over
+financial reporting in our annual report on Form 20-F. In addition, if we cease to be an "emerging growth company" as such
+term is defined in the JOBS Act, our independent registered public accounting firm must attest to and report on the effectiveness of
+our internal control over financial reporting on an annual basis. Our management may conclude that our internal control over financial
+reporting is not effective. Moreover, even if our management concludes that our internal control over financial reporting is effective,
+our independent registered public accounting firm, after conducting its own independent testing, may issue a report that is qualified
+if it is not satisfied with our internal controls or the level at which our controls are documented, designed, operated or reviewed,
+or if it interprets the relevant requirements differently from us. In addition, after we become a public company, our reporting obligations
+may place a significant strain on our management, operational and financial resources and systems for the foreseeable future. We may
+be unable to timely complete our evaluation testing and any required remediation.
+
+ 
+
+During
+the course of documenting and testing our internal control procedures, in order to satisfy the requirements of Section 404, we may identify
+other weaknesses and deficiencies in our internal control over financial reporting. In addition, if we fail to maintain the adequacy
+of our internal control over financial reporting, as these standards are modified, supplemented or amended from time to time, we may
+be unable to conclude on an ongoing basis that we have effective internal control over financial reporting in accordance with Section
+404. Generally speaking, if we fail to achieve and maintain an effective internal control environment, we could suffer material misstatements
+in our financial statements and fail to meet our reporting obligations, which would likely cause investors to lose confidence in our
+reported financial information. This could in turn limit our access to capital markets, harm our results of operations, and lead to a
+decline in the trading price of our Class A Ordinary Shares. Additionally, ineffective internal control over financial reporting could
+expose us to increased risk of fraud, misuse of corporate assets and legal actions under securities laws and subject us to potential
+delisting from the stock exchange on which we list, regulatory investigations and civil or criminal sanctions.
+
+ 
+
+ -32-
+
+ 
+
+ 
+
+ 
+
+We
+will be subject to changing laws, rules and regulations in the U.S. regarding regulatory matters, corporate governance and public disclosure
+that will increase both our costs and the risks associated with non-compliance.
+
+ 
+
+Following
+this offering, we will be subject to rules and regulations by various governing bodies and self-regulatory organizations, including,
+for example, the SEC and the Nasdaq, which are charged with the protection of investors and the oversight of companies whose securities
+are publicly traded, and to new and evolving regulatory measures under applicable law. Our efforts to comply with new and changing laws
+and regulations have resulted in and are likely to continue to result in increased general and administrative expenses and a diversion
+of management time and attention from revenue-generating activities to compliance activities.
+
+ 
+
+Moreover,
+as these laws, regulations and standards are subject to varying interpretations, their application in practice may evolve over time as
+new guidance becomes available. This evolution may result in continuing uncertainty regarding compliance matters and additional costs
+necessitated by ongoing revisions to our disclosure and governance practices. If we fail to address and comply with these regulations
+and any subsequent changes, we may be subject to penalties and our business may be harmed.
+
+ 
+
+Risks
+Relating to Doing Business in Hong Kong
+
+ 
+
+Through
+long arm provisions under the current PRC laws and regulations, the PRC government may exercise significant oversight over the conduct
+of our business, which could result in a material change in our operations and/or the value of our Class A Ordinary Shares. Changes in
+the policies, regulations and rules and the enforcement of laws of the Chinese government may also occur and our assertions and beliefs
+of the risk imposed by the PRC legal and regulatory system cannot be certain. To the extent any new or more stringent measures are required
+to be implemented, our business, financial condition and results of operations could be adversely affected and such measures could materially
+decrease the value of our Class A Ordinary Shares, potentially rendering them worthless.
+
+ 
+
+Our
+operations are located in Hong Kong. In addition, PRC laws and regulations may be interpreted and applied inconsistently by different
+Hong Kong or PRC agencies or authorities, and may be inconsistent with our current policies and practices. New laws, regulations, and
+other government directives in the PRC that apply to Trendic in Hong Kong may also be costly to comply with, and such compliance or any
+associated inquiries or investigations or any other PRC or Hong Kong government actions may:
+
+ 
+
+ 
+ 
+ intervene
+ or interfere with our operations at any time;
+
+ 
+ 
+ 
+
+ 
+ 
+ delay
+ or impede our development;
+
+ 
+ 
+ 
+
+ 
+ 
+ result
+ in negative publicity or increase our operating costs;
+
+ 
+ 
+ 
+
+ 
+ 
+ require
+ significant management time and attention; and/or
+
+ 
+ 
+ 
+
+ 
+ 
+ subject
+ us to remedies, administrative penalties and even criminal liabilities that may harm our business, including fines assessed for our
+ current or historical operations, or demands or orders that we modify or even cease our business practices.
+
+ 
+ 
+
+Any
+such interventions or actions could result in a material negative change in our operations, which could also negatively impact the value
+of our Class A Ordinary Shares.
+
+ 
+
+Recently,
+the PRC government initiated a series of regulatory actions and statements to regulate business operations in certain areas in China,
+including the regulation of certain activities in the United States and global securities markets, enhancing supervision over PRC-based
+companies listed overseas using VIE structures, adopting new measures to extend the scope of cybersecurity reviews, and expanding the
+efforts in anti-monopoly enforcement. Since some of these statements and regulatory actions are new, it is highly uncertain how soon
+legislative or administrative regulation making bodies will respond and what existing or new laws or regulations or detailed implementations
+and interpretations will be modified or promulgated, if any, and the potential impact such modified or new laws and regulations will
+have on our daily business operation, the ability to accept foreign investments and list on a U.S. or other foreign exchange.
+
+ 
+
+ -33-
+
+ 
+
+ 
+
+ 
+
+Given
+recent statements made by the PRC government indicating an intent to exert more supervision and regulations over offerings conducted
+overseas and foreign investment in PRC-based issuers, any such action could significantly limit or completely hinder your ability to
+offer or continue to offer securities to investors and could also result in a material change in our operations and/or the value of our
+Class A Ordinary Shares, or even our ability to continue to offer securities to investors, in which case the value of our Class A Ordinary Shares could significantly decline or become worthless.
+
+ 
+
+The
+promulgation of new laws or regulations, or the new interpretation of existing laws and regulations, in each case, that restrict or otherwise
+unfavorably impact the ability or way we conduct our business, could require us to change certain aspects of our business to achieve
+compliance, which could decrease demand for our services, reduce revenues, increase costs, require us to obtain more licenses, permits,
+approvals or certificates, or subject us to additional liabilities. To the extent any new or more stringent measures are required to
+be implemented, our business, financial condition and results of operations could be adversely affected and such measures could materially
+decrease the value of our Class A Ordinary Shares, potentially rendering them worthless. See "Recent Regulatory Developments
+in the PRC" on pages 9 to 12 of this prospectus for more information.
+
+ 
+
+In
+the event the PRC government restricts or prohibits cash transfers for Hong Kong, our ability to distribute earnings and pay dividends
+may be impeded, thus limiting our ability to grow our business or receive earnings to the detriment of our investors.
+
+ 
+
+Further,
+there are currently no restriction or limitation under the laws of Hong Kong on the conversion of HK dollar into foreign currencies and
+the transfer of currencies out of Hong Kong and the laws and regulations of the PRC on currency conversion control do not currently have
+any material impact on the transfer of cash between us and Trendic. However, the PRC government may, in the future, impose restrictions
+or limitations on our ability to move money out of Hong Kong to distribute earnings and pay dividends to and from the other entities
+within our organization or to reinvest in our business outside of Hong Kong. Such restrictions and limitations, if imposed in the future,
+may delay or hinder the expansion of our business outside of Hong Kong and may affect our ability to receive funds from Trendic See "Transfers
+of Cash to and from our Subsidiaries" on page 5 for more detailed discussion.
+
+ 
+
+The
+Chinese regulatory authorities could disallow our organizational structure, which would likely result in a material change in our operations
+and/or a material change in the value of the securities we are registering for sale, including that it could cause the value of such
+securities to significantly decline or become worthless.
+
+ 
+
+We
+are exposed to various risks and uncertainties stemming from the interpretations and implementations of laws and regulations in the PRC.
+These include, but are not limited to, the regulatory scrutiny of PRC companies overseas listings. Furthermore, we are susceptible
+to potential risks and uncertainties associated with future actions undertaken by the PRC government, which could potentially result
+in the disallowance of our organizational structure. Such an outcome would likely lead to a substantial transformation in our operational
+activities, and as a consequence, the value of our Class A Ordinary Shares may experience a significant depreciation or even become worthless.
+
+ 
+
+ -34-
+
+ 
+
+ 
+
+ 
+
+We
+may become subject to a variety of PRC laws and other regulations regarding data protection or cybersecurity, and any failure to comply
+with applicable laws and regulations could have a material and adverse effect on our business, financial condition and results of operations.
+
+ 
+
+We
+may become subject to a variety of laws and regulations in the PRC regarding privacy, data security, cybersecurity, and data protection,
+although we do not believe that we are currently subject to any such laws or regulations. These laws and regulations are continuously
+evolving and developing. The scope and interpretation of the laws that are or may be applicable to us are often uncertain and may be
+conflicting, particularly with respect to foreign laws. In particular, there are numerous laws and regulations regarding privacy and
+the collection, sharing, use, processing, disclosure, and protection of personal information and other user data. Such laws and regulations
+often vary in scope, may be subject to differing interpretations, and may be inconsistent among different jurisdictions.
+
+ 
+
+We
+obtain information about various aspects of our operations as well as regarding our employees and third parties. We also maintain information
+about various aspects of our operations as well as regarding our employees. The integrity and protection of our customer, employee and
+company data is critical to our business. Our customers and employees expect that we will adequately protect their personal information.
+We are required by applicable laws to keep strictly confidential the personal information that we collect, and to take adequate security
+measures to safeguard such information.
+
+ 
+
+The
+PRC Criminal Law, as amended by Amendment 7 (effective on February 28, 2009) and Amendment 9 (effective on November 1, 2015), prohibits
+institutions, companies and their employees from selling or otherwise illegally disclosing a citizen s personal information obtained
+during the course of performing duties or providing services or obtaining such information through theft or other illegal ways. On November
+7, 2016, the Standing Committee of the PRC National People s Congress issued the Cyber Security Law of the PRC, or Cyber Security
+Law, which became effective on June 1, 2017.
+
+ 
+
+Pursuant
+to the Cyber Security Law, network operators must not, without users consent, collect their personal information, and may only
+collect users personal information necessary to provide their services. Providers are also obliged to provide security maintenance
+for their products and services and shall comply with provisions regarding the protection of personal information as stipulated under
+the relevant laws and regulations.
+
+ 
+
+The
+Civil Code of the PRC (issued by the PRC National People s Congress on May 28, 2020 and effective from January 1, 2021) provides
+the main legal basis for privacy and personal information infringement claims under the Chinese civil laws. PRC regulators, including
+the CAC, the Ministry of Industry and Information Technology, and the Ministry of Public Security have been increasingly focused on regulation
+in the areas of data security and data protection.
+
+ 
+
+ -35-
+
+ 
+
+ 
+
+ 
+
+The
+PRC regulatory requirements regarding cybersecurity are constantly evolving. For instance, various regulatory bodies in China, including
+the CAC, the Ministry of Public Security and the State Administration for Market Regulation have interpreted and enforced data privacy
+and protection laws and regulations within their respective areas.
+
+ 
+
+In
+November 2016, the Standing Committee of China s National People s Congress passed the CSL, which became effective in June
+2017. The CSL is the first PRC law that systematically lays out the regulatory requirements on cybersecurity and data protection, subjecting
+many previously under-regulated or unregulated activities in cyberspace to government scrutiny. The legal consequences of violation of
+the CSL include penalties of warning, confiscation of illegal income, suspension of related business, winding up for rectification, shutting
+down the websites, and revocation of business license or relevant permits. In April 2020, the CAC and certain other PRC regulatory authorities
+promulgated the Cybersecurity Review Measures, which became effective in June 2020. Pursuant to the Cybersecurity Review Measures, operators
+of critical information infrastructure must pass a cybersecurity review when purchasing network products and services which do or may
+affect national security. On July 10, 2021, the CAC issued a revised draft of the Measures for Cybersecurity Review for public comments,
+or Draft Measures, which required that, in addition to "operator of critical information infrastructure," any "data
+processor" carrying out data processing activities that affect or may affect national security should also be subject to cybersecurity
+review, and further elaborated the factors to be considered when assessing the national security risks of the relevant activities, including,
+among others, (i) the risk of core data, important data or a large amount of personal information being stolen, leaked, destroyed, and
+illegally used or exited the country; and (ii) the risk of critical information infrastructure, core data, important data or a large
+amount of personal information being affected, controlled, or maliciously used by foreign governments after listing abroad. The CAC has
+said that under the proposed rules companies holding data on more than 1,000,000 users must now apply for cybersecurity approval when
+seeking listings in other nations because of the risk that such data and personal information could be "affected, controlled, and
+maliciously exploited by foreign governments." The cybersecurity review will also investigate the potential national security risks
+from overseas initial public offerings. On June 10, 2021, the Standing Committee of the National People s Congress promulgated
+the PRC Data Security Law, which took effect on September 1, 2021. The Data Security Law also sets forth the data security protection
+obligations for entities and individuals handling personal data, including that no entity or individual may acquire such data by stealing
+or other illegal means, and the collection and use of such data should not exceed the necessary limits. The costs of compliance with,
+and other burdens imposed by, CSL and any other cybersecurity and related laws may limit the use and adoption of our products and services
+and could have an adverse impact on our business.
+
+ 
+
+On
+December 28, 2021, thirteen PRC regulatory agencies, namely, the CAC, the National Development and Reform Commission, the Ministry of
+Industry and Information Technology, the Ministry of Public Security, the Ministry of State Security, the Ministry of Finance, the Ministry
+of Commerce, the State Administration for Market Regulation, CSRC, the People s Bank of China, the National Radio and Television
+Administration, National Administration of State Secrets Protection and the National Cryptography Administration, jointly adopted and
+published the Measures for Cybersecurity Review (2021), which became effective on February 15, 2022. The Measures for Cybersecurity Review
+(2021) required that, among others, in addition to "operator of critical information infrastructure" any "operator
+of network platform" holding personal information of more than one million users which seeks to list in a foreign stock exchange
+should also be subject to cybersecurity review.
+
+ 
+
+ -36-
+
+ 
+
+ 
+
+ 
+
+According
+to the temporary application of Chinese laws related to cybersecurity to companies within China, companies established in Hong Kong are
+not within the scope of application. The Company is therefore currently not required to obtain regulatory approval from the CAC nor any
+other PRC authorities for its and its subsidiaries operations in HK.
+
+ 
+
+We
+do not expect to be subject to the cybersecurity review by the CAC, given that: (i) using our products and services do not require providing
+users personal information; (ii) we possess minimum amount, if not none, of personal information in our business operations; (iii)
+data processed in our business does not have a bearing on national security and thus may not be classified as core or important data
+by the authorities and (iv) our operations are in HK, a Special Autonomous Region apart from mainland PRC. However, detailed implementation
+and interpretation related to network security are still under development. If any such new laws, regulations, rules, or implementation
+and interpretation comes into effect, we will take all reasonable measures and actions to comply and to minimize the adverse effect of
+such laws on us, where applicable and necessary.
+
+ 
+
+We
+cannot assure you that PRC regulatory agencies, including the CAC, would take the same view as we do, and there is no assurance that
+we can fully or timely comply with such laws. In the event that we are subject to any mandatory cybersecurity review and other specific
+actions required by the CAC, we face uncertainty as to whether any clearance or other required actions can be timely completed, or at
+all. Given such uncertainty, we may be further required to suspend our relevant business, shut down our website, or face other penalties,
+which could materially and adversely affect our business, financial condition, and results of operations.
+
+ 
+
+We
+believe that we have been in compliance with the data privacy and personal information requirements of the CAC. Neither the CAC nor any
+other PRC regulatory agency or administration has contacted the Company in connection with the Company s or its subsidiaries 
+operations.
+
+ 
+
+We
+may be subject to a variety of laws and other obligations regarding data protection in HK. The Personal Data (Privacy) Ordinance (Chapter
+486 of the Laws of Hong Kong), or the PDPO, came into force on 20 December 1996. The PDPO states that any person who controls the collection,
+holding, processing or use of personal data, or the data user, shall not do any act, or engage in a practice, that contravenes any of
+the data protection principles set out in Schedule 1 to the PDPO, or the Data Protection Principles, unless the act or practice, as the
+case may be, is required or permitted under the PDPO. Personal data means any data (a) relating directly or indirectly to a living individual;
+(b) from which it is practicable for the identity of the individual to be directly or indirectly ascertained; and (c) in a form in which
+access to or processing of the data is practicable.
+
+ 
+
+The
+Data Protection Principles set out that (1) personal data must be collected in a lawful and fair way, for a purpose directly related
+to a function or activity of the data user. Data subjects must be notified of the purpose for which the data is to be used and the classes
+of persons to whom the data may be transferred. Data collected should be adequate but not excessive; (2) personal data must be accurate
+and should not be kept for a period longer than necessary for the fulfillment of the purpose for which the data is or is to be used;
+(3) personal data must be used for the purpose for which the data is collected or for a directly related purpose unless voluntary and
+explicit consent with a new purpose is obtained from the data subject; (4) a data user shall take practicable steps to safeguard any
+personal data held against unauthorized or accidental access, processing, erasure, loss or use; (5) a data user shall take practicable
+steps so that its policies and practices in relation to personal data, the kind of personal data it holds and the main purposes for which
+the personal data is or is to be used for are made known to the public; and (6) a data shall be entitled to request access to personal
+data and must be allowed to correct the personal data if it is inaccurate.
+
+ 
+
+ -37-
+
+ 
+
+ 
+
+ 
+
+Moreover,
+the Personal Data (Privacy) (Amendment) Ordinance 2021, or the PDPAO, came into effect on 8 October 2021. It amends the PDPO, particularly
+to: (i) criminalize doxing, i.e. unconsented disclosure of personal information of targeted individuals and groups; (ii) introduce a
+cessation notice regime to tackle doxing with extra-territorial reach; and (iii) substantially expand the investigation and enforcement
+powers of the Privacy Commissioner for Personal Data, in contexts beyond doxing.
+
+ 
+
+We
+are of the view that we are not likely to be in breach of the PDPO and the PDPAO, for the following reasons: (i) using our products and
+services do not require providing applicable users personal information and (ii) we possess a minimum amount, if not none of the
+personal information in our business operations. Nonetheless, we are subject to laws and regulations relating to the collection, storage,
+use, processing, transmission, retention, security and transfer of personal information and other data. The interpretation and application
+of laws, regulations and standards on data protection and privacy may continue to evolve. We cannot assure you that the governmental
+authorities will not interpret or implement the laws or regulations in ways that negatively affect us. We may be subject to investigations
+and inspections by government authorities regarding our compliance with laws and regulations on data privacy, and we cannot assure you
+that our practices will always fully comply with all applicable rules and regulatory requirements. In addition, laws, regulations and
+standards on data protection and privacy continue to develop and may vary from jurisdiction to jurisdiction. Complying with emerging
+and changing international requirements may cause us to incur substantial costs or require us to change our business practices.
+
+ 
+
+ -38-
+
+ 
+
+ 
+
+ 
+
+The
+opinions recently issued by the General Office of the Central Committee of the Communist Party of China and the General Office of the
+State Council and the New Overseas Listing Rules promulgated by the CSRC may subject us to additional compliance requirements in the
+future.
+
+ 
+
+On
+February 17, 2023, with the approval of the State Council, the CSRC released the Trial Overseas Listing Measures and five supporting
+guidelines, which came into effect on March 31, 2023. According to the Trial Overseas Listing Measures, (1) domestic companies that seek
+to offer or list securities overseas, both directly and indirectly, should fulfill the filing procedures and report relevant information
+to the CSRC; if a domestic company fails to complete the filing procedures or conceals any material fact or falsifies any major content
+in its filing documents, such domestic company may be subject to administrative penalties, such as order to rectify, warnings, fines,
+and its controlling shareholders, actual controllers, the person directly in charge and other directly liable persons may also be subject
+to administrative penalties, such as warnings and fines; (2) if the issuer meets both of the following conditions, the overseas offering
+and listing shall be determined as an indirect overseas offering and listing by a domestic company: (i) any of the total assets, net
+assets, revenues or profits of the domestic operating entities of the issuer in the most recent accounting year accounts for more than
+50% of the corresponding figure in the issuer s audited consolidated financial statements for the same period; (ii) its
+major operational activities are carried out in China or its main places of business are located in China, or the senior managers in
+charge of operation and management of the issuer are mostly Chinese citizens or are domiciled in China; and (3) where a domestic company
+seeks to indirectly offer and list securities in an overseas market, the issuer shall designate a major domestic operating entity responsible
+for all filing procedures with the CSRC, and where an issuer makes an application for an initial public offering in an overseas market,
+the issuer shall submit filings with the CSRC within three business days after such application is submitted.
+
+ 
+
+Based
+on the above mentioned, given that (i) the Group currently does not have, nor does it currently intend to establish, any subsidiary nor
+plan to enter into any contractual arrangements to establish a VIE structure with any entity in the PRC; (ii) it is not controlled by
+any PRC entity or individual; (iii) it does not have any operation in the PRC, nor does it have any partnership or cooperation with any
+PRC entity or individual; (iv) it currently does not have, nor does it plan to have, any investment, such as owning or leasing any asset,
+in the PRC; (v) none of the senior managers in charge of the business operations and management are citizens of the PRC or domiciled
+in mainland China; and (vi) no revenue of the Company is generated from the PRC, this offering shall not be deemed as a domestic enterprise
+that indirectly offer or list securities on an overseas stock exchange, nor does it requires filing or approvals from the CSRC. We are
+not subject to any PRC laws and regulations except to those applicable to Hong Kong listed in Annex III of the Basic Law. We do not need
+permission or approval from the Chinese government to operate our business or offer our Class A Ordinary Shares. As such, we have not
+applied for and we have not been denied any permissions or approvals. We believe, and we have been advised by our PRC legal counsel,
+that we do not need permission or approval from the Chinese government to operate our business or offer our Class A Ordinary Shares. As
+such, we have not applied for and we have not been denied any permissions or approvals.
+
+ 
+
+ -39-
+
+ 
+
+ 
+
+ 
+
+Further,
+as of the date of this prospectus, in the opinion of our PRC legal counsel, Guangdong Wesley Law Firm, the Company is not considered
+a domestic enterprise under the Trial Measures and the Trial Measures do not apply to the Company, and its listing on Nasdaq does not
+require fulfilling the filing procedure to the CSRC. However, there can be no assurance that the relevant PRC governmental authorities,
+including the CSRC, would reach the same conclusion as us, or that the CSRC or any other PRC governmental authorities would not promulgate
+new rules or new interpretation of current rules (with retrospective effect) to require us to obtain CSRC or other PRC governmental approvals
+for this offering. If we or Trendic inadvertently conclude that such approvals are not required, we may be required to make corrections,
+be given a warning, be fined between RMB 1 million and RMB 10 million, warn the responsible person and impose a fine of not less than
+RMB 500,000 but not more than RMB 5 million, fine the controlling shareholder not less than RMB 1 million but not more than RMB 10 million,
+prevent the Company from entering the securities market and our ability to offer or continue to offer our Class A Ordinary Shares to investors
+could be significantly limited or completed hindered, which could cause the value of our Class A Ordinary Shares to significantly decline
+or become worthless. Our Group may also face sanctions by the CSRC, the CAC or other PRC regulatory agencies. These regulatory agencies
+may impose fines and penalties on our operations in China, limit our ability to pay dividends outside of the PRC, limit our operations
+in the PRC, delay or restrict the repatriation of the proceeds from this offering into the PRC or take other actions that could have
+a material adverse effect on our business, financial condition, results of operations and prospects, as well as the trading price of
+our securities.
+
+ 
+
+On
+February 24, 2023, the CSRC revised the Archives Rules issued in 2009. The Provisions on Strengthening Confidentiality and Archives Administration
+in Respect of Overseas Issuance and Listing of Securities by Domestic Enterprises, or the revised Archives Rules, came into effect on
+March 31, 2023. In the overseas listing activities of domestic companies, domestic companies, as well as securities companies and securities
+service institutions providing relevant securities services thereof, should establish a sound system of confidentiality and archival
+work, shall not disclose state secrets, or harm the state and public interests. Where a domestic company provides or publicly discloses
+to the relevant securities companies, securities service institutions, overseas regulatory authorities and other entities and individuals,
+or provides or publicly discloses through its overseas listing entity, any document or material involving any state secret or any work
+secret of any governmental agency, it shall report to the competent authority for approval in accordance with the law, and submit to
+the secrecy administration department for filing. Securities companies and securities service organizations shall comply with the confidentiality
+and archive management requirements, and keep the documents and materials properly. Securities companies and securities service institutions
+that provide domestic enterprises with relevant securities services for overseas issuance and listing of securities shall keep the working
+papers they compile (such as the records of working plan and procedure, evidence and supporting materials related to the services which
+are obtained and prepared by the aforementioned service providers) within the territory of the PRC. If such working papers need to be
+taken abroad, approval shall be obtained in accordance with relevant provisions.
+
+ 
+
+The
+Trial Overseas Listing Measures, and the revised Archives Rules as enacted, do not presently subject us to additional compliance requirements
+because we are not considered a PRC-based "domestic company" and are instead subject to general application of the Basic
+Law. However, we cannot assure you that they will not apply to us in the future. If they do eventually apply to us, we cannot assure
+you that we will be able to get the clearance of filing procedures under the Trial Overseas Listing Measures on a timely basis, or at
+all. Any failure by us to fully comply with new regulatory requirements, including but limited to the failure to complete the filing
+procedures with the CSRC if required, may significantly limit or completely hinder our ability to offer or continue to offer our Class A Ordinary Shares, cause significant disruption to our business operations, and severely damage our reputation, which would materially and adversely
+affect our financial condition and results of operations and cause our Class A Ordinary Shares to significantly decline in value or become
+worthless.
+
+ 
+
+ -40-
+
+ 
+
+ 
+
+ 
+
+Additionally,
+due to long arm provisions under the current PRC laws and regulations, there remains regulatory uncertainty with respect to the implementation
+and interpretation of laws in China. We are also subject to the risks of uncertainty about any future actions the Chinese government
+or authorities in Hong Kong may take in this regard.
+
+ 
+
+Should
+the Chinese government choose to exercise significant oversight and discretion over the conduct of Trendic s business, it may intervene
+in or influence our operations. Such governmental actions (i) could result in a material change in Trendic s operations; (ii) could
+hinder our ability to continue to offer securities to investors; and (iii) may cause the value of our Class A Ordinary Shares to significantly
+decline in value or become worthless.
+
+ 
+
+The
+HFCA Act and the Accelerating Holding Foreign Companies Accountable Act call for additional and more stringent criteria to be applied
+to emerging market companies upon assessing the qualification of their auditors, especially the non-U.S. auditors who are not
+inspected by the PCAOB. These developments could add uncertainties to our offering and listing on the Nasdaq Capital Market, and
+Nasdaq may determine to delist our securities if the PCAOB determines that it cannot inspect or fully investigate our auditor.
+
+ 
+
+On
+April 21, 2020, former SEC Chairman Jay Clayton and former PCAOB Chairman William D. Duhnke III, along with other senior SEC
+staff, released a joint statement highlighting the risks associated with investing in companies based in or have substantial operations
+in emerging markets including China. The joint statement emphasized the risks associated with lack of access for the PCAOB to inspect
+auditors and audit work papers in China and higher risks of fraud in emerging markets.
+
+ 
+
+On
+May 18, 2020, Nasdaq filed three proposals with the SEC to (i) apply minimum offering size requirement for companies primarily operating
+in "Restrictive Market", (ii) adopt a new requirement relating to the qualification of management or board of director
+for Restrictive Market companies, and (iii) apply additional and more stringent criteria to an applicant or listed company based
+on the qualifications of the company s auditors.
+
+ 
+
+On
+December 18, 2020, the "Holding Foreign Companies Accountable Act" was signed by President Donald Trump and became
+law. This legislation requires certain issuers of securities to establish that they are not owned or controlled by a foreign government.
+Specifically, an issuer must make this certification if the PCAOB is unable to audit specified reports because the issuer has retained
+a foreign public accounting firm not subject to inspection by the PCAOB. Furthermore, if the PCAOB is unable to inspect the issuer s
+public accounting firm for three (3) consecutive years beginning in 2021, the issuer s securities are banned from trade on
+a national exchange or through other methods.
+
+ 
+
+On
+June 22, 2021, the U.S. Senate passed the "Accelerating Holding Foreign Companies Accountable Act", which, if
+passed by the U.S. House of Representatives and signed into law by the President, would decrease the number of non-inspection years
+for foreign companies to comply with PCAOB audits from three (3) to two (2) years, thus, reducing the period before their securities
+may be prohibited from trading or delisted if the PCAOB determines that it cannot inspect or investigate our auditor completely.
+
+ 
+
+On
+November 5, 2021, the SEC approved the PCAOB s Rule 6100, Board Determinations Under the "Holding Foreign Companies
+Accountable Act". Rule 6100 provides a framework for the PCAOB to use to determine whether it is unable to inspect or
+investigate registered public accounting firms located in a foreign jurisdiction because of a position taken by one or more authorities
+in that jurisdiction.
+
+ 
+
+On
+December 2, 2021, the SEC adopted amendments to finalize rules implementing the submission and disclosure requirements in the HFCAA.
+The rules apply to registrants the SEC identifies as having filed an annual report with an audit report issued by a registered public
+accounting firm that is located in a foreign jurisdiction and that the PCAOB is unable to inspect or investigate.
+
+ 
+
+On
+December 16, 2021, the PCAOB issued a report on its determinations that the PCAOB is unable to inspect or investigate completely PCAOB-registered public
+accounting firms headquartered in mainland China and in Hong Kong, a Special Administrative Region of the PRC, because of positions
+taken by PRC authorities in those jurisdictions. The PCAOB made the Determinations pursuant to PCAOB Rule 6100, which provides a
+framework for how the PCAOB fulfills its responsibilities under the HFCAA.
+
+ 
+
+On
+August 26, 2022, the PCAOB signed the SOP Agreements with the CSRC and the MOF governing inspections and investigations, to establish
+a specific, accountable framework to make possible complete inspections and investigations by the PCAOB of audit firms based in mainland
+China and Hong Kong, as required under U.S. law.
+
+ 
+
+On
+December 15, 2022, the PCAOB determined that it was able to secure complete access to inspect and investigate registered public accounting
+firms headquartered in mainland China and Hong Kong and vacated its previous determinations to the contrary. However, should PRC authorities
+obstruct or otherwise fail to facilitate the PCAOB s access in the future, the PCAOB may consider the need to issue a new determination.
+
+ 
+
+On
+December 29, 2022, provisions of the Accelerating Holding Foreign Companies Accountable Act were signed into law as part of the Consolidated
+Appropriations Act, amending the HFCAA by requiring the SEC to prohibit an issuer s securities from trading on any U.S. stock exchanges
+if its auditor is not subject to PCAOB inspections for two consecutive years instead of three.
+
+ 
+
+Any
+lack of access to the PCAOB inspection in China prevents the PCAOB from fully evaluating audits and quality control procedures of the
+auditors based in China. As a result, the investors may be deprived of the benefits of such PCAOB inspections. The inability of the PCAOB
+to conduct inspections of auditors in China makes it more difficult to evaluate the effectiveness of these accounting firms audit
+procedures or quality control procedures as compared to auditors outside of China that are subject to the PCAOB inspections, which could
+cause existing and potential investors to lose confidence in audit procedures and reported financial information and the quality of financial
+statements of China-based companies.
+
+ 
+
+Our
+auditor, TAAD, is headquartered in Diamond Bar, California and registered with the PCAOB. Our auditor is subject to laws in the United States
+pursuant to which the PCAOB conducts regular inspections to assess an auditor s compliance with the applicable professional standards,
+and have been inspected by the PCAOB on a regular basis. As such, as of the date of this prospectus, our offering is not affected by
+the HFCAA and related regulations. However, the recent developments would add uncertainties to our offering and we cannot assure you
+whether Nasdaq or regulatory authorities would apply additional and more stringent criteria to us after considering the effectiveness
+of our auditor s audit procedures and quality control procedures, adequacy of personnel and training, or sufficiency of resources,
+geographic reach or experience as related to the audit of our financial statements. Furthermore, there is a risk that our auditor cannot
+be inspected by the PCAOB in the future. The lack of inspection could cause trading in our securities to be prohibited on a national
+exchange or in the over-the-counter trading market under the HFCAA and related regulations, and, as a result, Nasdaq may determine
+to delist our securities, which may cause the value of our securities to decline or become worthless.
+
+ 
+
+The
+Hong Kong legal system is subject to uncertainties in the interpretation and enforcement of PRC laws and regulations.
+
+ 
+
+Hong
+Kong is a Special Administrative Region of the PRC. Following British colonial rule from 1842 to 1997, China assumed sovereignty under
+the "one country, two systems" principle. The Hong Kong Special Administrative Region s constitutional document, the
+Basic Law, prescribes that Hong Kong s current sovereignty will remain in effect for 50 years.
+
+ 
+
+The
+PRC legal system is based on written statutes and prior court decisions have limited value as precedents. We cannot predict the effect
+of future developments in the Hong Kong legal system, including the promulgation of new laws, changes to existing laws or the interpretation
+or enforcement thereof, or the pre-emption of local regulations by national laws. These uncertainties could limit the legal protections
+available to us, including our ability to enforce our agreements with our customers.
+
+ 
+
+We
+may be affected by adverse changes in the political, economic, regulatory or social conditions in Hong Kong.
+
+ 
+
+Our
+operations in HK are subject to special PRC considerations and significant risks not typically associated with companies in North America
+and Western Europe. These include risks associated with, among others, the political, economic and legal environment and foreign currency
+exchange. Our operating results may be adversely affected by changes in the political and social conditions in HK, and by changes in
+governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad, and
+rates and methods of taxation, among other things. Similarly, Hong Kong s economy differs from the economies of most developed
+countries in many respects, including the amount of PRC government involvement, level of development, growth rate, control of foreign
+exchange and allocation of resources. Economic conditions in Hong Kong are sensitive to global economic conditions. Any economic downturn,
+changes in policies, currency and interest rate fluctuations, capital controls or capital restrictions, labor laws, changes in environmental
+protection laws and regulations, duties and taxation and limitations on imports and exports in these countries may materially and adversely
+affect our business, financial condition, results of operations and prospects.
+
+ 
+
+ -41-
+
+ 
+
+ 
+
+ 
+
+Risks
+Relating to Our Initial Public Offering and Ownership of Our Class A Ordinary Shares
+
+ 
+
+The
+market price of our Class A Ordinary Shares may be volatile or may decline regardless of our operating performance, and could result in
+significant losses and you may not be able to resell your shares at or above the offering price.
+
+ 
+
+The
+offering price for our Class A Ordinary Shares will be determined through negotiations between the underwriter and us and may vary from
+the market price of our Class A Ordinary Shares following our offering. If you purchase our Class A Ordinary Shares in our offering, you
+may not be able to resell those Class A Ordinary Shares at or above the offering price. We cannot assure you that our Class A Ordinary Shares 
+offering price, or the market price following our offering, will equal or exceed prices in privately negotiated transactions of our
+Class A Ordinary Shares that have occurred from time to time prior to our initial public offering. The market price of our Class A Ordinary Shares may fluctuate significantly in response to numerous factors, many of which are beyond our control, including:
+
+ 
+
+ 
+ 
+ actual
+ or anticipated fluctuations in our revenue and other operating results;
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ financial projections we may provide to the public, any changes in these projections or our failure to meet these projections;
+
+ 
+ 
+ 
+
+ 
+ 
+ actions
+ of securities analysts who initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow
+ our Company, or our failure to meet these estimates or the expectations of investors;
+
+ 
+ 
+ 
+
+ 
+ 
+ announcements
+ by us or our competitors of significant products or features, technical innovations, acquisitions, strategic partnerships, joint
+ ventures, or capital commitments;
+
+ 
+ 
+ 
+
+ 
+ 
+ price
+ and volume fluctuations in the overall stock market, including as a result of trends in the economy as a whole;
+
+ 
+ 
+ 
+
+ 
+ 
+ lawsuits
+ threatened or filed against us; and
+
+ 
+ 
+ 
+
+ 
+ 
+ other
+ events or factors, including those resulting from war or incidents of terrorism, or responses to these events.
+
+ 
+ 
+
+In
+addition, the trading price of our Class A Ordinary Shares is likely to be volatile and could fluctuate widely due to factors beyond our
+control. This may happen because of broad market and industry factors, akin to the performance and fluctuation of the market prices of
+other companies with business operations located mainly in HK or the PRC that have listed their securities in the United States. A number
+of Chinese companies have listed or are in the process of listing their securities on U.S. stock markets. The securities of some of these
+companies have experienced significant volatility, including price declines in connection with their initial public offerings. The trading
+performances of the securities of these Chinese companies after their offerings may affect the general perception and attitude of investors
+toward Chinese companies listed in the United. Consequently, these factors may impact the trading performance of our shares, notwithstanding
+our actual operating performance.
+
+ 
+
+In
+addition to market and industry factors, the price and trading volume for our Class A Ordinary Shares may be highly volatile for factors
+specific to our own operations, including the following:
+
+ 
+
+ 
+ 
+ variations
+ in our revenues, earnings and cash flow;
+
+ 
+ 
+ 
+
+ 
+ 
+ changes
+ in financial estimates by securities analysts;
+
+ 
+ 
+ 
+
+ 
+ 
+ additions
+ or departures of key personnel;
+
+ 
+ 
+ 
+
+ 
+ 
+ release
+ of lock-up or other transfer restrictions on our outstanding equity securities or sales of additional equity securities; and
+
+ 
+ 
+ 
+
+ 
+ 
+ potential
+ litigation or regulatory investigations.
+
+ 
+ 
+
+Any
+of these factors may result in large and sudden changes in the volume and price at which our Class A Ordinary Shares will trade.
+
+ 
+
+ -42-
+
+ 
+
+ 
+
+ 
+
+In
+the past, shareholders of public companies have often brought securities class action suits against companies following periods of instability
+in the market price of their securities. If we were involved in a class action suit, it could divert a significant amount of our management s
+attention and other resources from our business and operations and require us to incur significant expenses to defend the suit, which
+could harm our results of operations. Any such class action suit, whether or not successful, could harm our reputation and restrict our
+ability to raise capital in the future. In addition, if a claim is successfully made against us, we may be required to pay significant
+damages, which could have a material adverse effect on our financial condition and results of operations.
+
+ 
+
+The
+dual-class structure of our Class A Ordinary Shares may adversely affect the trading market for our Class A Ordinary Shares.
+
+ 
+
+Certain
+shareholder advisory firms have announced changes to their eligibility criteria for inclusion of Class A Ordinary Shares of public companies
+on certain indices, including the S&P 500, that would exclude companies with multiple classes of shares and companies whose public
+shareholders hold no more than 5% of the total voting power from being added to such indices. In addition, several shareholder advisory
+firms have announced their opposition to the use of multiple class structures. As a result, the dual-class structure of our Company may
+prevent the inclusion of our Class A Ordinary Shares in such indices and may cause shareholder advisory firms to publish negative commentary
+about our corporate governance practices or otherwise seek to cause us to change our capital structure. Any such exclusion from stock
+indices could result in a less active trading market for our Class A Ordinary Shares. Any actions or publications by shareholder advisory
+firms critical of our corporate governance practices or capital structure could also adversely affect the value of our Class A Ordinary Shares.
+
+ 
+
+We
+may not maintain the listing of our Class A Ordinary Shares on the Nasdaq, which could limit investors ability to make transactions
+in our Class A Ordinary Shares and subject us to additional trading restrictions.
+
+ 
+
+We
+intend to list our Class A Ordinary Shares on the Nasdaq concurrently with this offering. In order to continue listing our Class A Ordinary Shares on the Nasdaq, we must maintain certain financial and share price levels, and we may be unable to meet these requirements
+in the future. We cannot assure you that our Class A Ordinary Shares will continue to be listed on the Nasdaq in the future. If the Nasdaq
+delists our Class A Ordinary Shares and we are unable to list our Class A Ordinary Shares on another national securities exchange, we will
+endeavor to have our Class A Ordinary Shares quoted on an over-the-counter market in the United States. If this were to occur, we could
+face significant material adverse consequences, including:
+
+ 
+
+ 
+ 
+ a
+ limited availability of market quotations for our Class A Ordinary Shares;
+
+ 
+ 
+ 
+
+ 
+ 
+ reduced
+ liquidity for our Class A Ordinary Shares;
+
+ 
+
+ 
+
+ -43-
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ a
+ determination that our Class A Ordinary Shares are a "penny stock," which would require brokers trading in our shares
+ to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for
+ our Class A Ordinary Shares;
+
+ 
+ 
+ 
+
+ 
+ 
+ a
+ limited amount of news and analyst coverage; and
+
+ 
+ 
+ 
+
+ 
+ 
+ a
+ decreased ability to issue additional securities or obtain additional financing in the future.
+
+ 
+ 
+
+As
+long as our Class A Ordinary Shares are listed on the Nasdaq, U.S. federal law prevents or preempts states from regulating their sale
+of those listed Class A Ordinary Shares. However, the law does permit states to investigate companies if there is a suspicion of fraud,
+and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of those listed Class A Ordinary Shares.
+Further, if our Class A Ordinary Shares are no longer listed on the Nasdaq, we would be subject to regulations in each state in which
+we offer our Class A Ordinary Shares.
+
+ 
+
+Possible
+market volatility as a result of the substantial amount of Resale Shares being registered for resale
+
+ 
+
+The
+5,416,740 Class A Ordinary Shares in aggregate offered by the Resale Shareholders may introduce risks such as increased market
+volatility or downward pressure on your share price, as discussed in more detail in the risk factor below, because the Resale Shareholders
+may be willing to accept a lower sales price than the price investors pay in the Offering. In addition, Nasdaq has ongoing listing requirements,
+including that if we fail to maintain a share price above $1 for a 30-day trading period, our Class A Ordinary Shares would be delisted
+from Nasdaq. The Class A Ordinary Shares offered in the Resale Offering could cause our share price to decrease below $1.00 for a 30-day
+trading period. Failure to maintain the listing standards of Nasdaq could result in our Class A Ordinary Shares being delisted and we
+would not have a national securities exchange as a platform to trade our shares, thus significantly negatively impacting the liquidity
+of our Class A Ordinary Shares in addition to the other risks discussed in more detail in the risk factor above.
+
+ 
+
+Future
+issuances or sales, or perceived issuances or sales, of substantial amounts of Class A Ordinary Shares in the public market could materially
+and adversely affect the prevailing market price of the Class A Ordinary Shares and our ability to raise capital in the future.
+
+ 
+
+The
+market price of our Class A Ordinary Shares could decline as a result of future sales of substantial amounts of our Class A
+Ordinary Shares in the public market after the completion of this offering and from the sale of Class A Ordinary Shares by
+certain of our existing shareholders namely, Prime Crest Holdings Limited, Fuji Holdings Limited, Yield Rights Group Limited and Allied
+Target Limited, or collectively the Resale Shareholders, through the Resale Prospectus, or the perception that these sales could occur.
+Future sales, or perceived sales, of substantial amounts of the shares could adversely affect the market price of our Class A Ordinary
+Shares and could materially impair our ability to raise capital through equity offerings in the future. As of the date of this prospectus,
+we have 28,660,000 Class A Ordinary Shares and 1,000,000 Class B Ordinary Shares outstanding. The Class A Ordinary
+Shares sold in this offering will be freely tradable without restriction or further registration under the Securities Act, and Class
+A Ordinary Shares held by our existing shareholders may also be sold in the public market in the future subject to the restrictions
+in Rule 144 under the Securities Act and applicable lock-up agreements. The shares held by the Resale Shareholders do not form part
+of this offering and may be sold in the public market pursuant to the Resale Prospectus. The aggregate number of Class A Ordinary Shares
+being registered for resale exceeds the number of Class A Ordinary Shares being offered in this offering. As a result, a significant
+portion of our outstanding shares may become available for immediate resale following the offering, which could increase the supply of
+our Class A Ordinary Shares in the market and negatively impact the market price of our Class A Ordinary Shares. Given that the Resale
+Shareholders acquired their Class A Ordinary Shares at a discount to the public offering price, they may also, in selling their Class
+A Ordinary Shares, be willing to accept a lower sales price than the price investors pay in this offering, which could substantially
+lower the market price of our Class A Ordinary Shares. Class A Ordinary Shares. We cannot predict what effect, if any, market sales
+of these securities for future sale will have on the market price of our shares. See "Underwriting" and "Shares
+Eligible for Future Sale" for a more detailed description of the restrictions on selling our securities after this offering.
+
+ 
+
+There
+will be 30,000,000 Class A Ordinary Shares and 1,000,000 Class B Ordinary Shares outstanding immediately after this
+offering. In connection with this offering, our directors and officers named in the section "Management," and certain
+shareholders have agreed not to sell any shares until 180 days after the date of this prospectus without the prior written consent
+of the underwriter, subject to certain exceptions. However, the underwriter may release these securities from these restrictions at
+any time.
+
+ 
+
+Short
+selling may drive down the market price of our Class A Ordinary Shares.
+
+ 
+
+Short
+selling is the practice of selling shares that the seller does not own but rather has borrowed from a third party with the intention
+of buying identical shares back at a later date to return to the lender. The short seller hopes to profit from a decline in the value
+of the shares between the sale of the borrowed shares and the purchase of the replacement shares, as the short seller expects to pay
+less in that purchase than it received in the sale. Since it is in the short seller s interest for the price of the shares to decline,
+many short sellers publish, or arrange for the publication of, negative opinions and allegations regarding the relevant issuer and its
+business prospects in order to create negative market momentum and generate profits for themselves after selling the shares short. These
+negative opinions have, in the past, led to selling of shares in the market. If we were to become the subject of any unfavorable publicity,
+whether such allegations are proven to be true or untrue, we could have to expend a significant amount of resources to investigate such
+allegations and/or defend ourselves. While we would strongly defend against any negative opinions of short sellers, we may be constrained
+in the manner in which we can proceed against the relevant short seller by principles of freedom of speech, applicable state law or issues
+of commercial confidentiality. If we become the subject of any unfavorable allegations, whether such allegations are proven to be true
+or untrue, we will have to expend significant resources to investigate such allegations and/or defend our Company. This situation will
+be costly and time-consuming and distract our management from developing our growth. If such allegations are not proven to be groundless,
+we and our business operations will be severely affected, and you could sustain a significant decline in the value of our Class A Ordinary Shares.
+
+ 
+
+ -44-
+
+ 
+
+ 
+
+ 
+
+Because
+we may not expect to pay dividends in the foreseeable future, you may rely on price appreciation of our Class A Ordinary Shares for a
+return on your investment.
+
+ 
+
+We
+currently intend to retain all of our available funds and any future earnings after this offering to fund the development and growth
+of our business. As a result, we may not expect to pay any cash dividends in the foreseeable future. Therefore, you should not rely on
+an investment in our Class A Ordinary Shares as a source for any future dividend income. Our board of directors has complete discretion
+as to whether to distribute dividends, subject to certain requirements of Cayman Islands law. Even if our board of directors decides
+to declare and pay dividends, the timing, amount and form of future dividends, if any, will depend on, among other things, our future
+results of operations and cash flow, our capital requirements and surplus, the amount of distributions, if any, received by us from our
+subsidiaries, our financial condition, regulatory restrictions and other factors deemed relevant by our board of directors. Accordingly,
+the return on your investment in our securities will likely depend entirely upon any future price appreciation of our Class A Ordinary Shares.
+There is no guarantee that our Class A Ordinary Shares will appreciate in value after this offering or even maintain the price at
+which you purchased our Class A Ordinary Shares. You may not realize a return on your investment in our Class A Ordinary Shares and you
+may even lose your entire investment.
+
+ 
+
+Because
+our offering price is substantially higher than our net tangible book value per Class A Ordinary Share, you will experience immediate
+and substantial dilution.
+
+ 
+
+If
+you purchase Class A Ordinary Shares in the assumed completion of this offering, you will pay substantially more than the corresponding
+amount paid by existing shareholder for their shares and more than our net tangible book value per share. As a result, you will experience
+immediate and substantial dilution of US$4.352 per Class A Ordinary Share, representing the difference between our net tangible
+book value per Class A Ordinary Share of US$0.148 as of September 30, 2024, after giving effect to the net proceeds to us from
+this offering, assuming no change to the number of Class A Ordinary Shares offered by us as stated on the cover page of this prospectus
+and an assumed public offering price of US$4.50 per Class A Ordinary Share (being the mid-point of the offer price range set forth
+on the cover of this prospectus). See "Dilution" for a more complete description of how the value of your investment
+in our Class A Ordinary Shares will be diluted upon the completion of this offering.
+
+ 
+
+You
+must rely on the judgment of our management as to the uses of our net proceeds from this offering, and such uses may not produce income
+or increase our share price.
+
+ 
+
+We
+plan to use the net proceeds of this offering as discussed under "Use of Proceeds". However, our management will have
+considerable discretion in the application of the net proceeds received by us in this offering. You will not have the opportunity, as
+part of your investment decision, to assess whether proceeds are being used appropriately. The net proceeds may be used for corporate
+purposes that do not improve our efforts to achieve or maintain profitability or increase our share price. The net proceeds from this
+offering may be placed in investments that do not produce income or that lose value.
+
+ 
+
+ -45-
+
+ 
+
+ 
+
+ 
+
+If
+we become classified as a passive foreign investment company, United States taxpayers who own our securities may have adverse United
+States federal income tax consequences.
+
+ 
+
+A
+non-U.S. corporation such as our Company will be classified as a passive foreign investment company, which is known as a PFIC, for any
+taxable year if, for such year, either
+
+ 
+
+ 
+ 
+ At
+ least 75% of our gross income for the year is passive income; or
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ average percentage of our assets (determined at the end of each quarter) during the taxable year that produce passive income or that
+ are held for the production of passive income is at least 50%.
+
+ 
+ 
+
+Passive
+income generally includes dividends, interest, rents, royalties (other than rents or royalties derived from the active conduct of a trade
+or business) and gains from the disposition of passive assets.
+
+ 
+
+If
+we are determined to be a PFIC for any taxable year (or portion thereof) that is included in the holding period of a U.S. taxpayer who
+holds our securities, the U.S. taxpayer may be subject to increased U.S. federal income tax liability and may be subject to additional
+reporting requirements.
+
+ 
+
+It
+is possible that, in future taxable years, more than 50% of our assets may be assets which produce passive income. We will make this
+determination following the end of any particular tax year. We treat our affiliated entities as being owned by us for United States federal
+income tax purposes, not only because we exercise effective control over the operation of such entities but also because we are entitled
+to substantially all of their economic benefits, and, as a result, we combine their operating results in our consolidated financial
+statements. For purposes of the PFIC analysis, in general, a non-U.S. corporation is deemed to own its pro rata share of the gross income
+and assets of any entity in which it is considered to own at least 25% of the equity by value.
+
+ 
+
+For
+a more detailed discussion of the application of the PFIC rules to us and the consequences to U.S. taxpayers if we were determined to
+be a PFIC, see "Material Tax Considerations — Passive Foreign Investment Company Considerations."
+
+ 
+
+Our
+Controlling Shareholder has substantial influence over the Company. Its interests may not be aligned with the interests of our other
+shareholders, and it could prevent or cause a change of control or other transactions.
+
+ 
+
+As
+of the date of this prospectus, Ms. Seto beneficially owns approximately 76.40% of our issued and outstanding Class A
+Ordinary Shares. Ms. Seto is also our chief executive officer and director. Upon completion of this offering, she will be the
+beneficial owner of an aggregate of 21,236,240 Class A Ordinary Shares which will represent 70.81% of the then total
+issued and outstanding Class A Ordinary Shares. In addition, Ms. Seto holds 1,000,000 Class B Ordinary Shares which
+entitles her to twelve (12) votes any matter on which the action of shareholders is sought and is convertible into one Class A
+Ordinary Share at any time. Ms. Seto s aggregate voting power upon completion of this offering will be 79.13%.
+
+ 
+
+ -46-
+
+ 
+
+ 
+
+ 
+
+Accordingly,
+our Controlling Shareholder could control the outcome of any corporate transaction or other matter submitted to the shareholders for
+approval, including mergers, consolidations, the election of directors and other significant corporate actions, including the power to
+prevent or cause a change in control. Without the consent of our Controlling Shareholder, we may be prevented from entering into transactions
+that could be beneficial to us or our minority shareholders. In addition, our directors and officers could violate their fiduciary duties
+by diverting business opportunities from us to themselves or others. The interests of our largest shareholder may differ from the interests
+of our other shareholders. The concentration in the ownership of our shares may cause a material decline in the value of our Class
+A Ordinary Shares. For more information regarding our principal shareholders and their affiliated entities, see "Principal
+Shareholders."
+
+ 
+
+Upon
+the completion of this offering, we will be
+a "controlled company" within the meaning of the rules of Nasdaq and, as a result, we are permitted to elect to rely, and
+may rely on exemptions from certain corporate governance requirements that provide protection to shareholders of other companies.
+
+ 
+
+Upon
+the completion of this offering, we will be a "controlled company" as defined under the rules of Nasdaq. For so long as we
+remain a controlled company under that definition, we are permitted to elect to rely, and may rely, on certain exemptions from corporate
+governance rules, including:
+
+ 
+
+ 
+ 
+ an
+ exemption from the rule that a majority of our board of directors must be independent directors;
+
+ 
+ 
+ an
+ exemption from the rule that the compensation of our chief executive officer must be determined or recommended solely by independent
+ directors; and
+
+ 
+ 
+ an
+ exemption from the rule that our director nominees must be selected or recommended solely by independent directors.
+
+ 
+ 
+
+As
+a result, you may not have the same protection afforded to shareholders of companies that are subject to these corporate governance requirements.
+Accordingly, a majority of the members of our board of directors might not be independent directors and our nomination and compensation
+committees might not consist entirely of independent directors upon closing of the offering. Our status as a controlled company could
+cause our Class A Ordinary Shares to look less attractive to certain investors or otherwise harm our trading price. As a result, the investors
+will not have the same protection afforded to shareholders of companies that are subject to these corporate governance requirements.
+We currently do not plan to rely on these exemptions although we may in the future elect to so rely.
+
+ 
+
+As
+a company incorporated in the Cayman Islands, we are permitted to adopt certain home country practices in relation to corporate governance
+matters that differ significantly from the Nasdaq corporate governance listing standards. These practices may afford less protection
+to shareholders than they would enjoy if we complied fully with the Nasdaq corporate governance listing standards. 
+
+ 
+
+As
+a foreign private issuer that has applied to list our Class A Ordinary Shares on Nasdaq, we may rely on provisions in the Nasdaq corporate
+governance listing standards that allow us to follow Cayman Islands law with regard to certain aspects of corporate governance. This
+allows us to follow certain corporate governance practices that differ in significant respects from the corporate governance requirements
+applicable to U.S. companies listed on the Nasdaq.
+
+ 
+
+ -47-
+
+ 
+
+ 
+
+ 
+
+For
+example, we may be exempt from the Nasdaq regulations that require a listed U.S. company to:
+
+ 
+
+ 
+ 
+ provide
+an annual certification by our chief executive officer that he or she is not aware of any non-compliance with any corporate governance
+rules of the Nasdaq;
+
+ 
+ 
+ 
+
+ 
+ 
+ have
+ regularly scheduled executive sessions with only independent directors; and
+
+ 
+ 
+ 
+
+ 
+ 
+ seek
+ shareholders approval for prior to an issuance of securities in connection with (a) the acquisition of stock or assets of
+ another company; (b) equity-based compensation of officers, directors, employees or consultants; (c) a change of control; and (d)
+ transactions other than public offerings.
+
+ 
+ 
+
+As
+a foreign private issuer, we are permitted to follow home country practice in lieu of the above requirements. Our audit committee is
+required to comply with the provisions of Rule 10A-3 of the Exchange Act, which is applicable to U.S. companies listed on the Nasdaq.
+
+ 
+
+You
+may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because
+we are incorporated under Cayman Islands law.
+
+ 
+
+We
+are an exempted company incorporated under the laws of the Cayman Islands with limited liability. Our corporate affairs are governed
+by our memorandum of association of our Company adopted on July 5, 2024 and as supplemented, amended or otherwise modified from time
+to time, a copy of which is filed as Exhibit 3.1 to our Registration Statement of which this prospectus forms a part, or Memorandum of
+Association, and Articles of Association, the Companies Act and the common law of the Cayman Islands. We adopted an amended and
+restated memorandum and articles of association, which became effective on March 31, 2025 and replaced our memorandum
+and articles of association in its entirety on March 31, 2025, a copy of which is filed as
+Exhibit 3.2 to our Registration Statement of which this prospectus forms a part. The rights of shareholders to take action against our
+directors and us, actions by minority shareholders and the fiduciary duties of our directors to us under Cayman Islands law are, to a
+large extent, governed by the common law of the Cayman Islands. The common law of the Cayman Islands is derived in part from comparatively
+limited judicial precedent in the Cayman Islands as well as from the English common law, which is generally persuasive authority, but
+is not binding, on a court in the Cayman Islands. The rights of our shareholders and the fiduciary duties of our directors under Cayman
+Islands law are not as clearly established as they would be under statutes or judicial precedent in some jurisdictions of the United
+States. In particular, the Cayman Islands has a different body of securities laws than the United States, which provides significantly
+less protection to investors. In addition, Cayman Islands companies may not have the standing to initiate a shareholder derivative action
+in a federal court of the United States. There is no statutory recognition in the Cayman Islands of judgments obtained in the United
+States, although the courts of the Cayman Islands will, in certain circumstances, recognize and enforce a non-penal judgment of a foreign
+court of competent jurisdiction without retrial on the merits.
+
+ 
+
+Shareholders
+of Cayman Islands exempted companies like us have no general rights under Cayman Islands law to inspect corporate records (other than
+the Memorandum of Association and Articles of Association) or to obtain copies of lists of shareholders of these companies. Our directors
+are not required under our Memorandum of Association and Articles of Association to make our corporate records available for inspection
+by our shareholders. This may make it more difficult for you to obtain the information needed to establish any facts necessary for a
+shareholder resolution or to solicit proxies from other shareholders in connection with a proxy contest.
+
+ 
+
+Certain
+corporate governance practices in the Cayman Islands, which is our home country, differ significantly from requirements for companies
+incorporated in other jurisdictions, such as the U.S. Currently, we plan to rely on home country practice with respect to any corporate
+governance matter. Accordingly, our shareholders will be afforded less protection than they otherwise would under rules and regulations
+applicable to U.S. domestic issuers.
+
+ 
+
+ -48-
+
+ 
+
+ 
+
+ 
+
+As
+a result of all of the above, shareholders may have more difficulty in protecting their interests in the face of actions taken by our
+management, members of the board of directors or Controlling Shareholder than they would as shareholders of a company incorporated in
+the United States. For a discussion of significant differences between the provisions of the Companies Act and the laws applicable to
+companies incorporated in the United States and their shareholders, see "Certain Cayman Islands Company Considerations —
+Differences in Corporate Law."
+
+ 
+
+Because
+we are a Cayman Islands company and all of our business is conducted in Hong Kong, you may be unable to bring an action against us or
+our officers and directors or to enforce any judgment you may obtain.
+
+ 
+
+Although
+we are a Cayman Islands exempted company, we conduct all of our operations in Hong Kong and all of our assets are located in Hong Kong
+and all of our assets are located outside of the United States. In addition, the majority of our current directors and officers are nationals
+and residents of countries other than the United States. Substantially all of the assets of these persons are located outside the United
+States. As a result, it may be difficult for our shareholders to effect service on these persons or bring an action against us or against
+these individuals in the Cayman Islands or in Hong Kong in the event that they believe that their rights have been infringed under the
+securities laws of the United States or otherwise. Even if shareholders are successful in bringing an action of this kind, the laws of
+the Cayman Islands and Hong Kong may render them unable to enforce a judgment against our assets or the assets of our directors and officers.
+There is no statutory recognition in the Cayman Islands of judgments obtained in the United States or Hong Kong, although the courts
+of the Cayman Islands will in certain circumstances recognize and enforce a non-penal judgment of a foreign court of competent jurisdiction
+without retrial on the merits. Even if you are successful in bringing an action of this kind, the laws of the Cayman Islands and Hong
+Kong may render you unable to enforce a judgment against our assets or the assets of our directors and officers. For more information
+regarding the relevant laws of the Cayman Islands, see "Enforceability of Civil Liabilities." As a result of the foregoing,
+our shareholders may have more difficulties in protecting their interests through actions against us or our officers, directors or major
+shareholders than would shareholders of a corporation incorporated in a jurisdiction in the United States.
+
+ 
+
+We
+are an "emerging growth company," and we cannot be certain if the reduced reporting requirements applicable to emerging growth
+companies will make our Class A Ordinary Shares less attractive to investors.
+
+ 
+
+We
+are an "emerging growth company," as defined in the JOBS Act, and we may take advantage of certain exemptions from various
+requirements applicable to other public companies that are not emerging growth companies including, most significantly, not being required
+to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act for so long as we are an emerging growth
+company. As a result, if we elect not to comply with such auditor attestation requirements, our investors may not have access to certain
+information they may deem important.
+
+ 
+
+ -49-
+
+ 
+
+ 
+
+ 
+
+The
+JOBS Act also provides that an emerging growth company does not need to comply with any new or revised financial accounting standards
+until such date that a private company is otherwise required to comply with such new or revised accounting standards. In other words,
+an "emerging growth company" can delay the adoption of certain accounting standards until those standards would otherwise
+apply to private companies. We have elected to take advantage of the extended transition period, although we have adopted certain new
+and revised accounting standards based on transition guidance permitted under such standards. As a result of this election, our future
+financial statements may not be comparable to other public companies that comply with the public company effective dates for these new
+or revised accounting standards.
+
+ 
+
+We
+are a foreign private issuer within the meaning of the rules under the Exchange Act, and as such we are exempt from certain provisions
+applicable to United States domestic public companies.
+
+ 
+
+We
+are a foreign private issuer and, as a result, we are not subject to the same requirements as U.S. domestic issuers. Under the Exchange
+Act, we will be subject to reporting obligations that, to some extent, are more lenient and less frequent than those of U.S. domestic
+reporting companies. For example, we are exempt from certain provisions of the securities rules and regulations in the United States
+that are applicable to U.S. domestic issuers, including:
+
+ 
+
+ 
+ 
+ the
+ rules under the Exchange Act requiring the filing of quarterly reports on Form 10-Q or current reports on Form 8-K with the SEC;
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ sections of the Exchange Act regulating the solicitation of proxies, consents, or authorizations in respect of a security registered
+ under the Exchange Act;
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ sections of the Exchange Act requiring insiders to file public reports of their share ownership and trading activities and liability
+ for insiders who profit from trades made in a short period of time; and
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ selective disclosure rules by issuers of material non-public information under Regulation FD.
+
+ 
+ 
+
+However,
+we will still be subject to the anti-fraud and anti-manipulation rules of the SEC, such as Rule 10b-5 under the Exchange Act. Since many
+of the disclosure obligations imposed on us as a foreign private issuer differ from those imposed on U.S. domestic reporting companies,
+you should not expect to receive the same information about us and at the same time as the information provided by U.S. domestic reporting
+companies. Moreover, we will be required to file an annual report on Form 20-F within four months of the end of each fiscal year. In
+addition, we intend to publish our financial results on a semi-annual basis through press releases distributed pursuant to the rules
+and regulations of the Nasdaq. Press releases relating to financial results and material events will also be furnished to the SEC on
+Form 6-K. However, the information we are required to file with or furnish to the SEC will be less extensive and less timely compared
+to that required to be filed with the SEC by U.S. domestic issuers. As a result, you may not be afforded the same protections or information
+that would be made available to you if you were investing in a U.S. domestic issuer.
+
+ 
+
+ -50-
+
+ 
+
+ 
+
+ 
+
+We
+may lose our foreign private issuer status in the future, which could result in significant additional costs and expenses.
+
+ 
+
+As
+discussed above, we are a foreign private issuer, and, therefore, we are not required to comply with all of the periodic disclosure and
+current reporting requirements of the Exchange Act. The determination of foreign private issuer status is made annually on the last business
+day of an issuer s most recently completed second fiscal quarter. Accordingly, the next determination will be made with respect
+to us on September 30, 2025. In the future, we would lose our foreign private issuer status if (1) more than 50% of our outstanding
+voting securities are owned by U.S. residents, and (2) a majority of our directors or executive officers are U.S. citizens or residents,
+or we fail to meet additional requirements necessary to avoid loss of foreign private issuer status. If we were to lose our foreign private
+issuer status, we would be required to file with the SEC periodic reports and registration statements on U.S. domestic issuer forms,
+which are more detailed and extensive than the forms available to a foreign private issuer. We also would be required to comply with
+U.S. federal proxy requirements, and our officers, directors and principal shareholders would become subject to the short-swing profit
+disclosure and recovery provisions of Section 16 of the Exchange Act. In addition, we would lose our ability to rely upon exemptions
+from certain corporate governance requirements under the listing rules of the Nasdaq. As a U.S. listed public company that is not a foreign
+private issuer, we would incur significant additional legal, accounting and other expenses that we do not incur as a foreign private
+issuer.
+
+ 
+
+We
+will incur significantly increased costs and devote substantial amount of our management s time as a result of becoming a public
+company and the eventual listing of our Class A Ordinary Shares on the Nasdaq.
+
+ 
+
+As
+a public company, we will be subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, or the Exchange
+Act, the Sarbanes-Oxley Act, the Dodd-Frank Act, the listing requirements of the securities exchange on which we list, and other applicable
+securities rules and regulations. Despite recent reforms made possible by the JOBS Act, we will incur additional legal, accounting and
+other expenses as a public reporting company that we did not incur as a private company, particularly after we cease to qualify as an
+emerging growth company. For example, we will be required to comply with the additional requirements of the rules and regulations of
+the SEC and the Nasdaq rules, including applicable corporate governance practices. We expect that compliance with these requirements
+will increase our legal and financial compliance costs and will make some activities more time-consuming and costly. In addition, we
+expect that our management and other personnel will need to divert attention from operational and other business matters to devote substantial
+time to these public company requirements. We cannot predict or estimate the number of additional costs we may incur as a result of becoming
+a public company or the timing of such costs.
+
+ 
+
+In
+addition, changing laws, regulations and standards relating to corporate governance and public disclosure create uncertainty for public
+companies, increasing legal and financial compliance costs and make some activities more time-consuming. These laws, regulations and
+standards are subject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application
+in practice may evolve over time as new guidelines are provided by regulatory and governing bodies. This could result in continuing uncertainty
+regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. We intend to
+invest resources to comply with evolving laws, regulations and standards, and this investment may result in increased general and administrative
+expenses and a diversion of management s time and attention from revenue-generating activities to compliance activities. If our
+efforts to comply with new laws, regulations and standards differ from the activities intended by regulatory or governing bodies due
+to ambiguities related to their application and practice, regulatory authorities may also initiate legal proceedings against us, and
+our business may be adversely affected.
+
+ 
+
+ -51-
+
+ 
+
+ 
+
+ 
+
+Future
+financing may cause a dilution in your shareholding or place restrictions on our operations.
+
+ 
+
+We
+may need to raise additional funds immediately after the completion of this offering or in the future to finance further expansion of
+our capacity and business relating to our existing operations, acquisitions or strategic partnerships. If additional funds are raised
+through the issuance of new equity or equity-linked securities of the Company other than on a pro rata basis to existing shareholder,
+the percentage ownership of such shareholders in the Company may be reduced, and such new securities may confer rights and privileges
+that take priority over those conferred by the shares. Alternatively, if we meet such funding requirements by way of additional debt
+financing, we may have restrictions placed on us through such debt financing arrangements which may:
+
+ 
+
+ 
+ 
+ further
+ limit our ability to pay dividends or require us to seek consents for the payment of dividends;
+
+ 
+ 
+ 
+
+ 
+ 
+ increase
+ our vulnerability to general adverse economic and industry conditions;
+
+ 
+ 
+ 
+
+ 
+ 
+ require
+ us to dedicate a substantial portion of our cash flows from operations to service our debt, thereby reducing the availability of
+ our cash flow to fund capital expenditure, working capital requirements and other general corporate needs; and
+
+ 
+ 
+ 
+
+ 
+ 
+ limit
+ our flexibility in planning for, or reacting to, changes in our business and our industry.
+
+ 
+ 
+
+Our
+compensation of directors and executive officers may not be publicly available.
+
+ 
+
+Under
+Cayman Islands law, the Company is not required to disclose compensation paid to our senior management on an individual basis and the
+Company has not otherwise publicly disclosed this information elsewhere. The executive officers of the Company receive fixed and variable
+compensation. They also receive benefits in line with market practice. The fixed component of their compensation is set on market terms
+and adjusted annually. The variable component consists of cash bonuses and awards of shares (or the cash equivalent). Cash bonuses are
+paid to executive officers based on previously agreed targets for the business. Shares (or the cash equivalent) may be awarded under
+the 2025 Equity Incentive Plan (as defined below).
+
+ 
+
+As
+a result of all of the above, our public shareholders may have more difficulty in protecting their interests in the face of actions taken
+by management, members of our Board or controlling shareholders than they would as public shareholders of a company incorporated in the
+United States.
+
+ 
+
+ -52-
+
+ 
+
+ 
+
+ 
+
+USE
+OF PROCEEDS
+
+ 
+
+We
+estimate that we will receive net proceeds from the sale of Class A Ordinary Shares of approximately US$4.4 million based upon an
+assumed offering price of US$4.50 per share (being the midpoint of the range set forth on the cover page of this prospectus),
+of net proceeds from this offering after deducting underwriting discounts and commissions and estimated offering expenses of approximately
+US$1.6 million payable by us. We will not receive any proceeds from the sale of Class A Ordinary Shares by the Selling Shareholder
+or the Resale Shareholders.
+
+ 
+
+The
+primary purposes of this offering are to create a public market for our Class A Ordinary Shares for the benefit of all shareholders, retain
+talented employees by providing them with equity incentives and obtain additional capital.
+
+ 
+
+We
+currently intend to use the net proceeds of this offering as follows:
+
+ 
+
+ 
+ (i)
+ approximately
+ 10% to acquire multi-territorial IP license;
+
+ 
+ 
+ 
+
+ 
+ (ii)
+ approximately
+ 10% to set up our own ticketing platform; 
+
+ 
+ 
+ 
+
+ 
+ (iii)
+ approximately
+ 15% for possible strategic acquisitions;
+
+ 
+ 
+ 
+
+ 
+ (iv)
+ approximately
+ 15% to expand our marketing department and financing and administration department;
+
+ 
+ 
+ 
+
+ 
+ (v)
+ approximately
+ 10% for upgrading our enterprise resource planning system;
+
+ 
+ 
+ 
+
+ 
+ (vi)
+
+ approximately
+ 10% for repayment of loans made by Ms. Seto to us in connection with the payment of costs
+ and expenses in connection with this offering and obtaining a listing of our Shares on the
+ Nasdaq. The facility is unsecured, interest-free in the aggregate amount of up to HK$12,000,000.
+ As at the date of this prospectus, the amount drawn down is approximately HK$3.7 million
+ and is repayable on the earlier of the completion of this offering and September 30, 2025;
+ and
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+
+ 
+ (vii)
+ the
+ balance for working capital and other corporate purpose.
+
+ 
+ 
+
+The
+precise amounts and percentage of proceeds we would devote to particular categories of activity will depend on prevailing market and
+business conditions as well as particular opportunities that may arise from time to time. This expected use of our net proceeds from
+this offering represents our intentions based upon our current plans and business conditions, which could change in the future as our
+plans and business conditions evolve. The amounts and timing of our actual expenditures may vary significantly depending on numerous
+factors, including any unforeseen cash needs. Similarly, the priority of our prospective uses of proceeds will depend on business and
+market conditions as they develop. Accordingly, our management will have significant flexibility and broad discretion in applying the
+net proceeds of the offering. If an unforeseen event occurs or business conditions change, we may use the proceeds of this offering differently
+than as described in this prospectus.
+
+ 
+
+ -53-
+
+ 
+
+ 
+
+ 
+
+CAPITALIZATION
+
+ 
+
+The
+following table sets forth our capitalization as of September 30, 2024:
+
+ 
+
+ 
+ 
+ on
+ an actual basis; and
+
+ 
+ 
+ 
+
+ 
+ 
+ on
+ an as adjusted giving effect to the completion of the firm commitment offering at an assumed public offering price of US$4.50 per
+ share (being the midpoint of the range set forth on the cover page of this prospectus) and basis to reflect (i) the above; and (ii)
+ the issuance and sale of 1,340,000 Class A Ordinary Shares by us in this offering at an initial public offering price
+ of US$4.50 per Class A Ordinary Share (being the mid-point of the offer price range set forth on the cover of this prospectus)
+ after deducting underwriting discounts and estimated offering expenses payable by us.
+
+ 
+ 
+
+The
+as adjusted information below is illustrative only, and our capitalization following the completion of this offering is subject to adjustment
+based on the actual net proceeds to us from the offering. You should read this table in conjunction with "Use of Proceeds,"
+"Management s Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated
+financial statements and related notes included elsewhere in this prospectus.
+
+ 
+
+ 
+ 
+ As of September 30, 2024 
+
+ 
+ Shareholders Equity 
+ Actual 
+ As Adjusted 
+
+ 
+ 
+ HK$ 000 
+ HK$ 000 
+
+ 
+ Class A Ordinary Shares US$0.00001 par value authorized shares 9,500,000,000 shares as
+ of September 30, 2024; 28,660,000 shares issued and outstanding as of September 30, 2024 on an actual basis, 30,000,000 Class A Ordinary
+ Shares issued and outstanding on an as adjusted basis (assuming 1,340,000 Class A Ordinary Shares to be issued in this offering) 
+ 2,233 
+ 2,337 
+
+ 
+ Class B Ordinary Shares US$0.00001 par value authorized shares 500,000,000 shares as of September 30, 2024; 1,000,000 shares
+ issued and outstanding as of September 30, 2024 on an actual basis and as adjusted basis 
+ 78 
+ 78 
+
+ 
+ Additional paid-in capital 
+ - 
+ 34,173,184 
+
+ 
+ Subscription receivable 
+ (3,974) 
+ (3,974)
+
+ 
+ Capital reserve 
+ 2,011,663 
+ 2,011,663 
+
+ 
+ Retained earnings 
+ 3,202,600 
+ 3,202,600 
+
+ 
+ Total Shareholders Equity 
+ 5,212,600 
+ 39,385,888 
+
+ 
+ Total Capitalization 
+ $5,212,600 
+ $39,385,888 
+
+ 
+
+ 
+
+ -54-
+
+ 
+
+ 
+
+ 
+
+DIVIDEND
+POLICY
+
+ 
+
+For
+the year ended March 31, 2024, Trendic declared and paid a dividend of HK$5,500,000 (approximately US$706,000) to its shareholders registered
+as such on March 30, 2024. No dividend was declared or paid for the year ended March 30, 2023. For the six months ended September 30,
+2023 and 2024, no dividend was declared or paid by Trendic to its then existing shareholders. We do not intend to make any distributions
+immediately after the offering as we plan to retain earnings for growth in our operations.
+
+ 
+
+We
+have adopted a dividend policy, according to which our board of directors will take into account, among other things, the following factors
+when deciding whether to propose a dividend and in determining the dividend amount: (a) our consolidated operating and financial
+results; (b) our cash flow situation; (c) our business strategies and future operations and earnings; (d) taxation considerations; (e)
+interim dividends paid, if any; (f) capital requirements and expenditure plans; (g) statutory and regulatory restrictions; and (h) any
+other factors that our board of directors may consider relevant. The payment of dividends, in certain circumstances is also subject to
+the approval of our shareholders, the Companies Act and our Articles of Association as well as any other applicable laws. Currently,
+we do not have any predetermined dividend distribution ratio.
+
+ 
+
+Even
+if our board of directors decides to pay dividends, the form, frequency and amount will depend upon our future operations and earnings,
+capital requirements and surplus, general financial condition, contractual restrictions and other factors that the board of directors
+may deem relevant. In addition, we are a holding company and depend on the receipt of dividends and other distributions from our subsidiaries
+to pay dividends on our Class A Ordinary Shares.
+
+ 
+
+There
+are no foreign exchange controls or foreign exchange regulations under current applicable laws of the various places of incorporation
+of our significant subsidiaries that would affect the payment or remittance of dividends. As a holding company, we may rely on dividends
+and other distributions on equity paid by Trendic for our cash and financing requirements. We are permitted under the laws of the Cayman
+Islands and our Memorandum and Articles of Association (as amended from time to time) to provide funding to Trendic through loans or
+capital contributions. Trendic is permitted under the laws of Hong Kong to provide funding to us through dividend distribution without
+restrictions on the amount of the funds. If Trendic incurs debt on its own behalf in the future, the instruments governing such debt
+may restrict their ability to pay dividends to us. As of the date of this prospectus, Trendic has not experienced any difficulties or
+limitations on its ability to pay dividends; nor does it maintain cash management policies or procedures dictating the amount of such
+funding or how funds are transferred. There can be no assurance that the PRC government will not impose restrictions to prevent the cash
+maintained in Hong Kong from being transferred out or restrict the deployment of the cash into our business or for the payment of dividends.
+
+ 
+
+ -55-
+
+ 
+
+ 
+
+ 
+
+DILUTION
+
+ 
+
+Investors
+purchasing our Class A Ordinary Shares in this offering will experience immediate and substantial dilution in the pro forma as adjusted
+net tangible book value of their Class A Ordinary Shares. Dilution in pro forma as adjusted net tangible book value represents the difference
+between the initial public offering price of our Class A Ordinary Shares and the pro forma as adjusted net tangible book value per share
+of our Ordinary Shares immediately after the offering.
+
+ 
+
+Historical
+net tangible book value per share represents our total tangible assets (total assets excluding goodwill and other intangible assets,
+net) less total liabilities, divided by the number of outstanding Class A and Class B Ordinary Shares. After giving effect to
+the sale of Class A Ordinary Shares in this offering by the Company at an initial public offering price of US$4.5 per Class A
+Ordinary Share (being the midpoint of the range set out on the cover of this prospectus), after deducting approximately US$0.5 million
+in underwriting discounts and commissions and estimated offering expenses payable by the Company of approximately US$1.1 million,
+the pro forma as adjusted net tangible book value as of September 30, 2024 would have been approximately US$4.6 million, or US$0.148
+per Ordinary Share. This represents an immediate increase in pro forma as adjusted net tangible book value of US$0.141
+per Ordinary Share to our existing stockholders and an immediate dilution of US$4.352 per Class A Ordinary Share to new
+investors purchasing Class A Ordinary Shares in this offering.
+
+ 
+
+The
+following table illustrates this dilution on a per share basis to new investors.
+
+ 
+
+ 
+ 
+ US$ 
+
+ 
+ Assumed initial
+ public offering price per Class A Ordinary Share(1) 
+ 4.5
+
+ 
+ Historical net tangible book value per Ordinary
+ Share as of September 30, 2024 
+ 0.007
+ 
+
+ 
+ Increase in as adjusted net
+ tangible book value per Ordinary Share attributable to the investors in this offering 
+ 0.141
+ 
+
+ 
+ Pro forma net tangible book
+ value per Ordinary Share after giving effect to this offering 
+ 0.148
+ 
+
+ 
+ Dilution per Class A Ordinary
+ Share to new investors participating in this offering 
+ 4.352
+ 
+
+ 
+
+ 
+
+ 
+ (1)
+ Being
+ the midpoint of the range set out on the cover of this prospectus.
+
+ 
+ 
+
+ -56-
+
+ 
+
+ 
+
+ 
+
+SELECTED
+CONSOLIDATED FINANCIAL AND OTHER DATA
+
+ 
+
+The
+following selected consolidated financial data for the financial years ended March 31, 2023 and 2024, and for the six months
+ended September 30,2023 and 2024 have been derived from our unaudited consolidated financial statements. The selected financial
+data set forth below should be read in conjunction with, and are qualified by reference to "Management s Discussion and Analysis
+of Financial Condition and Results of Operations" and our consolidated financial statements and notes thereto included elsewhere
+in this prospectus. Our consolidated financial statements are prepared and presented in accordance with the provisions of the
+IFRS. Our historical results do not necessarily indicate results expected for any future period.
+
+ 
+
+The
+following table shows key components of our results of operations during the six months ended September 30, 2023 and 2024.
+
+ 
+
+ 
+ 
+ Six
+ months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Revenues 
+ $3,545,487 
+ $30,462,186 
+
+ 
+ Revenues,
+ related party 
+ 227,588 
+ 552,166 
+
+ 
+ Total
+ Revenues, net 
+ 3,773,075 
+ 31,014,352 
+
+ 
+ 
+ 
+ 
+
+ 
+ Costs and expenses: 
+ 
+ 
+
+ 
+ Cost of revenue 
+ (2,042,940) 
+ (19,736,299)
+
+ 
+ Cost
+ of revenue – related party 
+ - 
+ (468,350)
+
+ 
+ 
+ (2,042,940) 
+ (20,204,649)
+
+ 
+ Selling, general and administrative
+ expenses 
+ (72,454) 
+ (4,226,640)
+
+ 
+ Research and development 
+ - 
+ (660,000)
+
+ 
+ Amortization 
+ - 
+ (2,318,444)
+
+ 
+ Impairment of rights of
+ use assets 
+ - 
+ (111,136)
+
+ 
+ Depreciation 
+ (149,906) 
+ (238,649)
+
+ 
+ 
+ 
+ 
+
+ 
+ Profit
+ from operations 
+ 1,507,775 
+ 3,254,834 
+
+ 
+ 
+ 
+ 
+
+ 
+ Other income/(expenses): 
+ 
+ 
+
+ 
+ Interest income 
+ 354 
+ 38,676 
+
+ 
+ Finance costs 
+ (129,176) 
+ (232,971)
+
+ 
+ Other
+ income 
+ - 
+ 1,000 
+
+ 
+ Total
+ other income/(expenses), net 
+ (128,822) 
+ (193,295)
+
+ 
+ 
+ 
+ 
+
+ 
+ Profit
+ before income taxes 
+ 1,378,953 
+ 3,061,539 
+
+ 
+ 
+ 
+ 
+
+ 
+ Income
+ tax expense 
+ (23,000) 
+ (350,000)
+
+ 
+ 
+ 
+ 
+
+ 
+ NET
+ PROFIT 
+ $1,355,953 
+ $2,711,539 
+
+ 
+
+ 
+
+The
+following table shows key components of our results of operations during the fiscal years ended March 31, 2023 and 2024.
+
+ 
+
+ 
+ 
+ Year
+ Ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Revenues 
+ $1,137,909 
+ $20,103,097 
+
+ 
+ Revenues,
+ related party 
+ 2,477,228 
+ 337,586 
+
+ 
+ Total Revenues,
+ net 
+ 3,615,137 
+ 20,440,683 
+
+ 
+ 
+ 
+ 
+
+ 
+ Costs and expenses: 
+ 
+ 
+
+ 
+ Cost of revenue 
+ (3,262,588) 
+ (11,360,489)
+
+ 
+ General and administrative
+ expenses 
+ (490,636) 
+ (666,286)
+
+ 
+ Depreciation 
+ (206,006) 
+ (294,083)
+
+ 
+ 
+ 
+ 
+
+ 
+ Profit/(Loss)
+ from operations 
+ (344,093) 
+ 8,119,825 
+
+ 
+ 
+ 
+ 
+
+ 
+ Other income/(expenses): 
+ 
+ 
+
+ 
+ Interest income 
+ 441 
+ 22,995 
+
+ 
+ Finance costs 
+ (179,651) 
+ (246,262)
+
+ 
+ Other
+ income 
+ 40,520 
+ 180,663 
+
+ 
+ Total
+ other income/(expenses), net 
+ (138,690) 
+ (42,604)
+
+ 
+ 
+ 
+ 
+
+ 
+ Profit/(Loss)
+ before income taxes 
+ (482,783) 
+ 8,077,221 
+
+ 
+ 
+ 
+ 
+
+ 
+ Income
+ tax expense 
+ - 
+ (988,347)
+
+ 
+ 
+ 
+ 
+
+ 
+ NET
+ PROFIT/(LOSS) 
+ $(482,783) 
+ $7,088,874 
+
+ 
+
+ 
+
+ -57-
+
+ 
+
+ 
+
+ 
+
+MANAGEMENT S
+DISCUSSION AND ANALYSIS OF
+
+FINANCIAL
+CONDITION AND RESULTS OF OPERATIONS
+
+ 
+
+The
+following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated
+financial statements and related notes included elsewhere in this prospectus. This discussion and analysis and other parts of this prospectus
+contain forward-looking statements based upon current beliefs, plans and expectations that involve risks, uncertainties and assumptions.
+Our actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements
+as a result of several factors, including those set forth under "Risk Factors" and elsewhere in this prospectus. You should
+carefully read the "Risk Factors" section of this prospectus to gain an understanding of the important factors that could
+cause actual results to differ materially from our forward-looking statements.
+
+ 
+
+Overview
+
+ 
+
+We
+are an event management service provider based in Hong Kong with over eight years of experience in managing the entire or part of the
+event lifecycle for our customers. Events encompass a range of public and private events, from trade shows, conferences, concerts, exhibitions,
+charity galas, brand promotion events to internal corporate events. For enterprises, events offer a highly effective way to maximize
+their engagement with customers, helping enterprises to generate and qualify leads, deepen relationships with customers and build brand
+loyalty and advocacy, such as promotion of a brand by satisfied customers through customers sharing positive experiences on social media,
+providing referrals to friends and family, or simply telling others about the brand.
+
+ 
+
+We
+specialize in assisting event organizers in organizing, planning, promoting and managing themed touring walk-through experience events,
+or experience events, for intellectual property owners, or IP owners, of characters in well-publicized animated cartoons and/or live
+action theatrical motion pictures, each a licensed character. This type of experience events typically involve an intellectual property
+license, or IP license, from the IP owner to an event organizer, giving the event organizer the right to develop, organize, plan, promote
+and manage experience events relating to the licensed character and other licensed properties, including the name of the licensed character,
+title of the animated cartoon/live action theatrical motion picture, costumes, environmental settings, plot elements and artwork together
+as the licensed property in approved venues in a specified number of territories. During the experience event, event attendees may separately
+purchase, in designated area(s) at the approved venue, (i) various interactive activities and/or entertainment, including hands-on active-play/participation
+and/or media-based activities, such as green-screen photo/video capturing activities where guests are offered the opportunity to have
+their photo and/or video taken using green-screen capture technology, or the interactive opportunities; (ii) custom-made merchandise
+featuring the licensed property that are commissioned specially for the experience event, or the custom-made merchandise, as well as
+other licensed merchandise featuring the licensed property that are supplied by the IP owners and/or its licensee(s); and (iii) food
+and beverage products.
+
+ 
+
+Apart
+from organizing, planning, promoting and managing experience events, we also engage in the design and/or sale of merchandise, such as
+merchandise sold in concert venues and merchandise used as gift with purchase by our customers, as well as event management for brands,
+such as setting-up and running of pop-up stores and organizing store opening/product launch press events for labels.
+
+ 
+
+During
+the COVID-19, pandemic most of the in-person events were rescheduled, postponed or cancelled and our business relied on the design and/or
+sale of merchandise and government subsidies. When things started to normalize after the COVID-19 pandemic, our business primarily focused
+on event management business again.
+
+ 
+
+During
+the six months ended September 30, 2024, we started to be an event organizer for events.
+
+ 
+
+For
+the six months ended September 30, 2023 and 2024, our net revenue amounted to approximately HK$3.8 million and approximately HK$31.0
+million, respectively, representing an increase of approximately 722%. Due to our business expansion as event organizer for events and
+the end of the COVID-19 pandemic lock down policies by the HK government, we recorded a net profit for the six months ended September
+30, 2023 amounting to approximately HK$1.36 million compared to a net profit for the year ended September 30, 2024 amounting to approximately
+HK$2.71 million.
+
+ 
+
+ -58-
+
+ 
+
+ 
+
+ 
+
+For
+the years ended March 31, 2023 and 2024, our net revenue amounted to approximately HK$3.6 million and approximately HK$20.4 million,
+respectively, representing an increase of approximately 465%. Due to our business expansion and the end of the COVID-19 pandemic lock
+down policies by the HK government, we recorded a net loss for the year ended March 31, 2023 amounting to approximately HK$0.48 million
+compared to a net profit for the year ended March 31, 2024 amounting to approximately HK$7.09 million.
+
+ 
+
+For
+Description and Analysis of Principal Components of Our Results of Operations for the six months ended September 30, 2023 and 2024, please
+refer to pages 59 to 66.
+
+ 
+
+For Description and Analysis
+of Principal Components of Our Results of Operations for the years ended March 31, 2023 and 2024, please refer to pages 67 to 74.
+
+ 
+
+Description
+and Analysis of Principal Components of Our Results of Operations for the six months ended September 30, 2023 and 2024
+
+ 
+
+The
+following table shows key components of our results of operations during the six months ended September 30, 2023 and 2024.
+
+ 
+
+ 
+ 
+ Six
+ months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Revenues 
+ $3,545,487 
+ $30,462,186 
+
+ 
+ Revenues,
+ related party 
+ 227,588 
+ 552,166 
+
+ 
+ Total
+ Revenues, net 
+ 3,773,075 
+ 31,014,352 
+
+ 
+ 
+ 
+ 
+
+ 
+ Costs
+ and expenses: 
+ 
+ 
+
+ 
+ Cost
+ of revenue 
+ (2,042,940) 
+ (19,736,299)
+
+ 
+ Cost
+ of revenue – related party 
+ - 
+ (468,350)
+
+ 
+ 
+ (2,042,940) 
+ (20,204,649)
+
+ 
+ Selling,
+ general and administrative expenses 
+ (72,454) 
+ (4,226,640)
+
+ 
+ Research
+ and development 
+ - 
+ (660,000)
+
+ 
+ Amortization 
+ - 
+ (2,318,444)
+
+ 
+ Impairment
+ of rights of use assets 
+ - 
+ (111,136)
+
+ 
+ Depreciation 
+ (149,906) 
+ (238,649)
+
+ 
+ 
+ 
+ 
+
+ 
+ Profit
+ from operations 
+ 1,507,775 
+ 3,254,834 
+
+ 
+ 
+ 
+ 
+
+ 
+ Other
+ income/(expenses): 
+ 
+ 
+
+ 
+ Interest
+ income 
+ 354 
+ 38,676 
+
+ 
+ Finance
+ costs 
+ (129,176) 
+ (232,971)
+
+ 
+ Other
+ income 
+ - 
+ 1,000 
+
+ 
+ Total
+ other income/(expenses), net 
+ (128,822) 
+ (193,295)
+
+ 
+ 
+ 
+ 
+
+ 
+ Profit
+ before income taxes 
+ 1,378,953 
+ 3,061,539 
+
+ 
+ 
+ 
+ 
+
+ 
+ Income
+ tax expense 
+ (23,000) 
+ (350,000)
+
+ 
+ 
+ 
+ 
+
+ 
+ NET
+ PROFIT 
+ $1,355,953 
+ $2,711,539 
+
+ 
+
+ 
+
+The
+following discussion is based on our historical results of operations and may not be indicative of our future operating performance.
+
+ 
+
+ -59-
+
+ 
+
+ 
+
+ 
+
+Six
+Months Ended September 30, 2023 Compared to September 30, 2024
+
+ 
+
+Revenue
+
+ 
+
+We
+derive our revenue from the provision of event management services, sale of goods and ticketing, sponsorship and design services. Revenue
+from provision of event management services represented revenue derived from events planning, development and operation services. Sales
+of goods represented revenue derived from procurement and sales of goods/drinks to customers from events and non-events and ticketing
+represented tickets sold and used for events. Sponsorship income represented titleship for the events. Video production income represented
+revenue from video production at event requested by customers. Design services represented revenue from design services as requested
+by customers. The following table sets forth our revenue for the six months ended September 30, 2023 and 2024:
+
+ 
+
+ 
+ 
+ Six
+ months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Provision
+ of event management services 
+ $251,102 
+ $4,423,413 
+
+ 
+ Sales
+ of goods and tickets 
+ 
+ 
+
+ 
+ Tickets 
+ - 
+ 7,202,453 
+
+ 
+ Sales
+ of goods and cafe from events 
+ 1,351,286 
+ 5,837,873 
+
+ 
+ Sales
+ of goods and caf from non-events 
+ 1,445,687 
+ 831,218 
+
+ 
+ 
+ 2,796,973 
+ 13,871,544 
+
+ 
+ 
+ 
+ 
+
+ 
+ Sponsorship 
+ - 
+ 3,769,374 
+
+ 
+ Video
+ production 
+ - 
+ 8,950,021 
+
+ 
+ Design
+ and others 
+ 725,000 
+ - 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total: 
+ $3,773,075 
+ $31,014,352 
+
+ 
+
+ 
+
+Our
+total revenue increased by approximately HK$27.2 million, or approximately 722%, to approximately HK$31.0 million for the six months
+ended September 30, 2024 from approximately HK$3.8 million for the six months ended September 30, 2023. This increase was mainly
+attributable to the end of the COVID-19 pandemic lock down policies in or around March 2023, resulting in the revival of in-person
+events and we entered into more contract of contract for manage exhibition after that. Moreover, the increase of our event related
+income was because we started to act as event organizer/co-organizer for events during the six months ended September 30, 2024,
+enhancing our revenue stream from events such as sales of tickets, sponsorship and video production requested by a
+customer.
+
+ 
+
+Cost
+of revenues
+
+ 
+
+ 
+ 
+ Six
+ months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Sub-contracting
+ fee from event facilitators 
+ $- 
+ $4,788,530 
+
+ 
+ Ticketing
+ platform 
+ - 
+ 225,575 
+
+ 
+ Cost
+ of goods sold for IP products 
+ 1,276,503 
+ 2,307,012 
+
+ 
+ Staff
+ costs 
+ 702,351 
+ 2,930,741 
+
+ 
+ Royalty
+ fee 
+ 39,000 
+ 1,343,941 
+
+ 
+ Design
+ and renovation 
+ - 
+ 4,124,635 
+
+ 
+ Equipment
+ rental 
+ - 
+ 1,024,424 
+
+ 
+ Video
+ production costs 
+ - 
+ 1,672,824 
+
+ 
+ Other
+ costs 
+ 25,086 
+ 1,786,967 
+
+ 
+ Total: 
+ $2,042,940 
+ $20,204,649 
+
+ 
+
+ 
+
+For
+the six months ended September 30, 2023 and 2024, our cost of revenues was mainly comprised of cost of goods sold for IP products, staff
+costs, subcontracting fees from event facilitators, royalty fees for short term use of IP, design and renovation, and other costs related
+to events. For the six months ended September 30, 2023 and 2024, our cost of revenues amounted to approximately HK$2.0 million and HK$22.5
+million, respectively. The increase in costs of revenue during the six months ended September 30, 2024 was in line with the increase
+in revenue due to business expansion.
+
+ 
+
+ -60-
+
+ 
+
+ 
+
+ 
+
+General
+and Administrative expenses
+
+ 
+
+The
+following table sets forth the breakdown of our general and administrative expenses for the six months ended September 30, 2023 and 2024:
+
+ 
+
+ 
+ 
+ Six
+ months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Accounting
+ fee 
+ $- 
+ $48,000 
+
+ 
+ Bank
+ charges 
+ 260 
+ 42,186 
+
+ 
+ Insurance
+ expenses 
+ 25,347 
+ 20,755 
+
+ 
+ Staff
+ payroll costs 
+ 30,920 
+ 1,082,423 
+
+ 
+ Listing
+ fees 
+ - 
+ 1,933,527 
+
+ 
+ Legal
+ and professional fees 
+ 4,055 
+ 188,842 
+
+ 
+ Travelling
+ expenses 
+ - 
+ 83,017 
+
+ 
+ Marketing
+ fee for events 
+ - 
+ 513,097 
+
+ 
+ Office
+ expenses 
+ 8,891 
+ 107,549 
+
+ 
+ Sundries 
+ 2,981 
+ 207,244 
+
+ 
+ Total: 
+ $72,454 
+ $4,226,640 
+
+ 
+
+ 
+
+Our
+general and administrative expenses amounted to approximately HK$0.07 million and approximately HK$4.89 million for the six months
+ended September 30, 2023 and 2024, respectively. The increase was mainly due to (i) listing fees such as audit, legal and such fees
+are IPO related expenses that do not qualify for capitalization as deferred offering cost; (ii) the increase in staff costs due to
+increase in staff and insurance purchased as designated contribution to Ms. Seto; and business expansion during the six months ended
+September 30, 2024.
+
+ 
+
+Research
+and development
+
+ 
+
+Research
+and development mainly represented research and development expenses incurred for our website and e-ticket platform. Research and
+development expenses amounted to nil and approximately HK$0.66 million, respectively, during the six months ended September 30, 2023
+and 2024.
+
+ 
+
+Amortization
+
+ 
+
+Amortization
+mainly represented amortization expenses incurred from licenses acquired for the events. Amortization expenses amounted to nil and approximately
+HK$2.3 million, respectively, during the six months ended September 30, 2023 and 2024.
+
+ 
+
+Impairment
+of rights of use assets
+
+ 
+
+Impairment
+of rights of use assets mainly represented impairment made due to uncertainty on future economic benefits on relevant rights of use assets.
+Impairment of rights of use assets amounted to nil and approximately HK$0.11 million, respectively, during the six months ended September
+30, 2023 and 2024.
+
+ 
+
+Depreciation
+
+ 
+
+Depreciation
+mainly represented depreciation expenses incurred for equipment and right-of-use assets for office premises and motor vehicles. Depreciation
+amounted to approximately HK$0.15 million and approximately HK$0.24 million, respectively, during the six months ended September 30,
+2023 and 2024.
+
+ 
+
+ -61-
+
+ 
+
+ 
+
+ 
+
+Other
+Income/ (Expense), Net
+
+ 
+
+The
+following table sets forth the breakdown of our other income/(expense) for the six months ended September 30, 2023 and 2024:
+
+ 
+
+ 
+ 
+ Six
+ months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Bank
+ interest income 
+ $354 
+ $38,676 
+
+ 
+ Finance
+ costs 
+ (129,176) 
+ (232,971)
+
+ 
+ Others 
+ - 
+ 1,000 
+
+ 
+ Total 
+ $(128,822) 
+ $(193,295)
+
+ 
+
+ 
+
+Finance
+costs represented the interest expenses for bank borrowings and finance lease during the years ended March 31, 2023 and 2024. The increase
+in finance costs was mainly attributable to the increase of bank borrowings during the six ended September 30, 2024.
+
+ 
+
+Income
+Tax Expenses
+
+ 
+
+During
+the six months ended September 30, 2023 and 2024, the income tax expenses of approximately HK$0.02 million and HK$0.35 million, respectively
+were recognized as we generated no assessable income for the fiscal year under the local tax regime, after tax adjustments.
+
+ 
+
+Net
+Profit
+
+ 
+
+As
+a result of the foregoing, our net profit for the six months ended September 30, 2023 and 2024 amounted to approximately HK$1.36 million
+and approximately HK$2.71 million, respectively.
+
+ 
+
+Liquidity
+and Capital Resources
+
+ 
+
+Our
+liquidity and working capital requirements primarily relate to our operating expenses. Historically, we have met our working capital
+and other liquidity requirements primarily through cash generated from our operations. Going forward, we expect to fund our working capital
+and other liquidity requirements from various sources, including cash generated from our operations, loans from banking facilities, the
+net proceeds from this offering and other equity and debt financings as and when appropriate.
+
+ 
+
+ -62-
+
+ 
+
+ 
+
+ 
+
+Cash
+flows
+
+ 
+
+The
+following table summarizes our cash flows for the six months ended September 30, 2023 and 2024:
+
+ 
+
+ 
+ 
+ Six
+ months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Net
+ cash provided by/(used in) operating activities 
+ $426,487 
+ $(7,893,870)
+
+ 
+ Net
+ cash provided by/(used in) investing activities 
+ 354 
+ (5,333,101)
+
+ 
+ Net
+ cash provided by/(used in) financing activities 
+ (567,448) 
+ 10,773,040 
+
+ 
+ Net
+ change in cash and cash equivalent 
+ (140,067) 
+ (2,453,931)
+
+ 
+ BEGINNING
+ OF PERIOD 
+ 328,214 
+ 3,817,083 
+
+ 
+ END
+ OF PERIOD 
+ $187,607 
+ $1,363,152 
+
+ 
+
+ 
+
+Cash
+flows from operating activities
+
+ 
+
+For
+the six months ended September 30, 2024, our net cash used in operating activities was approximately HK$7.89 million, which
+primarily consisted of our net profit before tax of approximately HK$3.06 million, mainly adding back (i) the non-cash depreciation
+of right of use assets and equipment of approximately HK$0.24 million and finance costs of approximately HK$0.23 million, (ii) the
+impairment of approximately HK$0.11 million; (iii) the increase in amortization of licenses of approximately HK$2.32 million, (iv)
+the increase in contract assets for upcoming events of approximately HK$2.78 million, increase in inventory of approximately HK$1.49
+million, increase in accounts receivable of approximately HK$6.22 million for receivables not yet settled as at September 30, 2024,
+the increase in deposits, prepayments and other receivables of approximately HK$1.56 million, the increase in amount due from
+related parties of approximately HK$2.13 million, the increase in amount due from/(to) joint operation parties of approximately
+HK$1.65 million and was partially offset by (v) increase in trade and other payable of approximately HK$0.91 million for payables
+incurred for upcoming events and increase in contract liabilities of approximately HK$1.10 million due to advanced payment from
+customer for provision of event services to be performed subsequent to the balance sheet date.
+
+ 
+
+For
+the six months ended September 30, 2023, our net cash provided by operating activities was approximately HK$0.43 million, which primarily
+consisted of our net profit before tax of approximately HK$1.38 million, mainly adding back (i) the non-cash depreciation of right of
+use assets of approximately HK$0.15 million and finance costs of approximately HK$0.13 million, (ii) the increase in contract assets
+of approximately HK$0.59 million and the increase in accounts receivable of approximately HK$1.72 million and (iii) the increase in trade
+and other payable of approximately HK$1.07 million.
+
+ 
+
+Cash
+flows from investing activities
+
+ 
+
+For
+the six months ended September 30, 2024, our net cash provided by/(used in) investing activities was approximately HK$0.04 million from interest income
+and intangible assets acquired of approximately HK$5.37 million.
+
+ 
+
+For
+the six months ended September 30, 2023, our net cash provided by investing activities was only HK$354 from interest income.
+
+ 
+
+Cash
+flows from financing activities
+
+ 
+
+For
+the six months ended September 30, 2024, our net cash provided by financing activities was approximately HK$10.78 million which was mainly
+due to the increase of proceeds from a shareholder of HK$7.07 million and the increase in bank overdraft of HK$5.59 million and the increase
+in bank borrowings of approximately of HK$2.88 million, and partially offset by the payments to a shareholder of approximately HK$4.07
+million.
+
+ 
+
+For
+the six months ended September 30, 2023, our net cash used in financing activities was approximately HK$0.57 million which was mainly
+due to the increase of proceeds from a shareholder of HK$1.24 million, partially offset by the payments to a shareholder of approximately
+HK$1.33 million, the repayment of bank borrowings of approximately 0.22 million and lease liabilities of approximately HK$0.13 million.
+
+ 
+
+Capital
+commitments
+
+ 
+
+As
+of March 31, 2024 and September 30, 2024, we did not have any capital commitments.
+
+ 
+
+Key
+Factors Affecting our Results of Operations
+
+ 
+
+Our
+financial condition and results of operation have been and will continue to be affected by a number of factors, many of which may be
+beyond our control, including those factors set out in the section headed , ' ': , ' ': Risk Factors in this prospectus.
+These factors include the following:
+
+ 
+
+ 
+ 
+ 
+ Economic
+ conditions of Hong Kong and Asian markets: our revenues may significantly be affected by economic conditions of places for the events
+ to be convened for events and sold of goods. A slowdown in the economy, such as deterioration of overall economic sentiment may decrease
+ the willingness of customers for the events and purchased of IP products, which in turn may decrease their need on overall our services
+ and products, and affect our operating business performance;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Dependence
+ on key customer: our revenues may significantly be affected by the demands of our key customer due to market competitions such as
+ pricing strategy offered by competitors;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Limited
+ vendors for events facilitators and IP products: our costs for goods to be sold for IP products may significantly be affected due
+ to limited vendors for events facilitators and IP products;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Dependence
+ on co-organizer/joint operation parties: our revenue and costs for event may significantly be affected due to co-organizer/joint
+ operation parties performance;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Ability
+ to manage staff costs: any upward changes in our staff costs that are not in proportion to an increase in our revenues would impact
+ our results of operations negatively;
+
+ 
+ 
+
+ -63-
+
+ 
+
+ 
+
+ 
+
+Off-Balance
+Sheet Transactions
+
+ 
+
+As
+of September 30, 2024, we have not entered into any material off-balance sheet transactions or arrangements.
+
+ 
+
+We
+have not entered into any financial guarantees or other commitments to guarantee the payment obligations of any third parties. In addition,
+we have not entered into any derivative contracts that are indexed to our own shares and classified as shareholders equity, or
+that are not reflected in our consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets
+transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. Moreover, we do not have
+any variable interest in an unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages
+in leasing, hedging or research and development services with us.
+
+ 
+
+Critical
+Accounting Policies and Estimates
+
+ 
+
+Our
+financial statements and accompanying notes have been prepared in accordance with IFRS accounting standards. The preparation of these
+financial statements and accompanying notes requires us to make estimates and judgments that affect the reported amounts of assets, liabilities,
+revenues and expenses, and related disclosure of contingent assets and liabilities. We base our estimates on historical experience and
+on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis of making
+judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We have identified certain
+accounting policies that are significant to the preparation of our financial statements. These accounting policies are important for
+an understanding of our financial condition and results of operation. Critical accounting policies are those that are most important
+to the portrayal of our financial conditions and results of operations and require management s difficult, subjective, or complex
+judgment, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in
+subsequent periods. Certain accounting estimates are particularly sensitive because of their significance to financial statements and
+because of the possibility that future events affecting the estimate may differ significantly from management s current judgments.
+While our significant accounting policies are more fully described in Note 2 to the consolidated financial statements included elsewhere
+in this prospectus, we believe the following critical accounting policies involve the most significant estimates and judgments used in
+the preparation of our financial statements.
+
+ 
+
+ 
+ 
+ Revenue
+ Recognition 
+
+ 
+ 
+
+The
+Company adopted Accounting Standards Revenue
+from Contracts with Customers (IFRS 15), which provided the following overview of how revenue is recognized from the Company s
+contracts with customers: The Company recognizes revenue to depict the transfer of promised goods or services to customers in an amount
+that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services.
+
+ 
+
+Step
+1: Identify the contract(s) with a customer.
+
+ 
+
+Step
+2: Identify the performance obligations in the contract.
+
+ 
+
+Step
+3: Determine the transaction price – The transaction price is the amount of consideration in a contract to which an entity expects
+to be entitled in exchange for transferring promised goods or services to a customer.
+
+ 
+
+Step
+4: Allocate the transaction price to the performance obligations in the contract – Any entity typically allocates the transaction
+price to each performance obligation on the basis of the relative standalone selling prices of each distinct good or service promised
+in the contract.
+
+ 
+
+Step
+5: Recognize revenue when (or as) the entity satisfies a performance obligation – An entity recognizes revenue when (or as) it
+satisfies a performance obligation by transferring a promised good or service to a customer (which is when the customer obtains control
+of that good or service). The amount of revenue recognized is the amount allocated to the satisfied performance obligation. A performance
+obligation may be satisfied at a point in time (typically for promises to transfer goods to a customer) or over time (typically for promises
+to transfer service to a customer).
+
+ 
+
+ -64-
+
+ 
+
+ 
+
+ 
+
+Revenue
+related to event planner 
+
+ 
+
+The
+Company identified the following three types of performances under the event management contract: i) events planning, design, development
+and operation, or the Event Management Services; ii) Procurement and sales of goods (including but not limited to IP goods, drinks, tickets)
+to customer; iii) sponsorship commission income. The Company s revenue is derived from contracts with customers in the rendering
+of Event Management Services, and as such, the revenue recognized depicts the transfer of promised services to its customers in an amount
+that reflects the consideration to which the Company expects to be entitled in exchange for those services when the events start. The
+Company considers the terms of the contract and all relevant facts and circumstances when applying this guidance. The duration of the
+service period is usually less than one year. The Company recognize Event Management Services revenue when the event starts and during
+the event period ratably because: i) Based on the contract terms, none of parties that entered into the contract can terminate, and find
+other vendors to substitute the services; ii) And the customer benefits from our service beginning at the point of the event started
+to the event completion. The Company generally requires the customers to make the advanced payment at certain percentage of the total
+contract value upon signing the agreement. Contract liabilities are recorded when the advanced payment is received from the customers
+before all of the relevant criteria for revenue recognition has been met. The event management contract price is lump sum basis, consisted
+of sales of goods and Event Management Services consideration. For allocation of transaction price of sales of goods and Event Management
+Services, the company applied cost plus margin method to determine the sales of goods revenue based on standalone sales of goods gross
+margin, and allocate the remaining provision consideration into event management services. For sponsorship commission income, there is
+specified percentage calculation based on sponsorship fee raised (if any).
+
+ 
+
+For
+sponsorship commission income, it is sponsorship for the whole event period and recognized over the event period align with Event Management
+Services.
+
+ 
+
+Revenue
+related to event organizer
+
+ 
+
+The
+Company obtained IP directly from IP owner and authorized to convene events as organizer or co-organizer. The Company identified the
+following four types of performances under the event: i) sales of event tickets for the events; ii) Procurement and sales of goods (including
+but not limited to IP goods and drinks) to customer; iii) sponsorship commission income and (iv) ad hoc requested by customer say video
+production for the event
+
+ 
+
+The
+Company sold the event tickets through on site or sales platform. For event tickets income, it is recognized upon the provision of events.
+
+ 
+
+The
+Company sold the goods at the event. Revenue from sales of goods is recognized at a point in time when control of the goods has been
+transferred to the customers. Control is primarily evidenced by taking physical possession and inventory risk of the goods. The Group
+controls the goods and determines the selling price or allocated selling price (under event management services contracts) of the good
+before the good is transferred to the customers.
+
+ 
+
+For
+sponsorship commission income, there is specified percentage calculation based on sponsorship fee raised (if any). For sponsorship commission
+income, it is sponsorship for the whole event period and recognized over the event period align with Event Management Services.
+
+ 
+
+For
+ad hoc income say video production, it is recognized upon the video delivered and confirmed by customer.
+
+ 
+
+For
+events have co-organizer, the revenue recognition is similar the above under heading revenue related to event organizer but proportion
+based on agreed terms to the agreement with joint operations parties. Please refer to interest in joint operations paragraph in Note
+2.
+
+ 
+
+Design
+
+ 
+
+Revenue
+from designed services is recognized over the time. The revenue generated from design services are generally based on the fixed fee billing
+arrangements that require the clients to pay a pre-established fee in exchange for a predetermined set of design services. The design
+services provide involve a series of tasks which are distinct and meet the criteria for recognizing revenue overtime. In addition, the
+Group concludes that the services provided each month are substantially similar and result in the transfer of substantially similar services
+to the clients each month. The Group recognizes revenues from design services on a monthly basis when it satisfies its performance obligations
+throughout the contract terms. Because the design works were performed by inhouse designer and/or monitored by in-house designer through
+external designer (value added services), the Company controls the specified designed services before that services are transferred to
+a customer and the Company will determine the selling price, and thus, the Company is principal instead of agent for design services.
+
+ 
+
+ -65-
+
+ 
+
+ 
+
+ 
+
+Recent
+Accounting Pronouncements
+
+ 
+
+See
+the discussion of the recent accounting pronouncements contained in Note 2 to the unaudited consolidated financial statements, "Summary
+of Significant Accounting Policies".
+
+ 
+
+Quantitative
+and Qualitative Disclosures about Market Risk
+
+ 
+
+Credit
+Risk
+
+ 
+
+Financial
+instruments that potentially subject the Company to credit risk consist of cash equivalents and accounts receivable. Cash equivalents
+are maintained with high credit quality institutions, the composition and maturities of which are regularly monitored by management.
+The Hong Kong Deposit Protection Board pays compensation up to a limit of HKD500,000 if the bank with which an individual/a company hold
+its eligible deposit fails. As of March 31, 2024 and September 30, 2024, cash and bank balances of HKD3,817,083 and HKD1,363,152 was
+maintained at financial institutions in Hong Kong, of which none of its cash balance was subject to credit risk. However, if the individual
+bank balance is over HKD500,000, the excess will be subject to credit risk if the relevant bank fails. While management believes that
+these financial institutions are of high credit quality, it also continually monitors their credit worthiness.
+
+ 
+
+For
+accounts receivable, the Company determines, on a continuing basis, the allowance for doubtful accounts based on the estimated realizable
+value. The Company identifies credit risk on a customer by customer basis. The information is monitored regularly by management. Concentration
+of credit risk arises when a group of customers having similar characteristics such that their ability to meet their obligations is expected
+to be affected similarly by changes in economic conditions.
+
+ 
+
+The
+Company has determined the default event on a financial asset to be when internal and/or external information indicates that the financial
+asset is unlikely to be received, which could include default of contractual payments due for more than 90 days, default of interest
+due for more than 365 days or there is significant difficulty of the counterparty. To minimize credit risk, the Company has developed
+and maintained its credit risk grading to categorize exposures according to their degree of risk of default. The credit rating information
+is supplied by publicly available financial information and the Company s own trading records to rate its major customers and other
+debtors.
+
+ 
+
+As
+of March 31, 2024 and September 30, 2024, there were accounts receivables of HKD826,687 and HKD7,041,845, respectively. Two of customers
+as at March 31, 2024 and September 30, 2024 are amounted to 10% or more of the total consolidated amounts.
+
+ 
+
+Interest
+rate risk
+
+ 
+
+As
+the Company has no significant interest-bearing assets, the Company s income and operating cash flows are substantially independent
+of changes in market interest rates.
+
+ 
+
+Economic
+and political risk
+
+ 
+
+The
+Company s major operations are conducted in Hong Kong. Accordingly, the political, economic, and legal environments in Hong Kong,
+as well as the general state of Hong Kong s economy may influence the Company s business, financial condition, and results
+of operations.
+
+ 
+
+Liquidity
+risk
+
+ 
+
+Liquidity
+risk is the risk that we will not be able to meet our financial obligations as they become due. Our policy is to ensure that we have
+sufficient cash to meet our liabilities when they become due, under both normal and stressed conditions, without incurring unacceptable
+losses or risking damage to our reputation. A key risk in managing liquidity is the degree of uncertainty in the cash flow projections.
+If future cash flows are fairly uncertain, the liquidity risk increases. Liquidity risk is controlled by the application of financial
+position analysis and monitoring procedures. When necessary, we will turn to financial institutions and related parties to obtain short-term
+funding to cover any liquidity shortage.
+
+ 
+
+ -66-
+
+ 
+
+ 
+
+ 
+
+Description
+and Analysis of Principal Components of Our Results of Operations for the years ended March 31, 2023 and 2024
+
+ 
+
+The
+following table shows key components of our results of operations during the fiscal years ended March 31, 2023 and 2024.
+
+ 
+
+ 
+ 
+ Year
+ Ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Revenues 
+ $1,137,909 
+ $20,103,097 
+
+ 
+ Revenues,
+ related party 
+ 2,477,228 
+ 337,586 
+
+ 
+ Total
+ Revenues, net 
+ 3,615,137 
+ 20,440,683 
+
+ 
+ 
+ 
+ 
+
+ 
+ Costs
+ and expenses: 
+ 
+ 
+
+ 
+ Cost
+ of revenue 
+ (3,262,588) 
+ (11,360,489)
+
+ 
+ General
+ and administrative expenses 
+ (490,636) 
+ (666,286)
+
+ 
+ Depreciation 
+ (206,006) 
+ (294,083)
+
+ 
+ 
+ 
+ 
+
+ 
+ Profit/(Loss)
+ from operations 
+ (344,093) 
+ 8,119,825 
+
+ 
+ 
+ 
+ 
+
+ 
+ Other
+ income/(expenses): 
+ 
+ 
+
+ 
+ Interest
+ income 
+ 441 
+ 22,995 
+
+ 
+ Finance
+ costs 
+ (179,651) 
+ (246,262)
+
+ 
+ Other
+ income 
+ 40,520 
+ 180,663 
+
+ 
+ Total
+ other income/(expenses), net 
+ (138,690) 
+ (42,604)
+
+ 
+ 
+ 
+ 
+
+ 
+ Profit/(Loss)
+ before income taxes 
+ (482,783) 
+ 8,077,221 
+
+ 
+ 
+ 
+ 
+
+ 
+ Income
+ tax expense 
+ - 
+ (988,347)
+
+ 
+ 
+ 
+ 
+
+ 
+ NET
+ PROFIT/(LOSS) 
+ $(482,783) 
+ $7,088,874 
+
+ 
+
+ 
+
+The
+following discussion is based on our historical results of operations and may not be indicative of our future operating performance.
+
+ 
+
+ -67-
+
+ 
+
+ 
+
+ 
+
+Fiscal
+Year Ended March 31, 2023 Compared to Fiscal Year Ended March 31, 2024
+
+ 
+
+Revenue
+
+ 
+
+We
+derive our revenue from the provision of event management services, sale of goods and design services. Revenue from provision of event
+management services represented revenue derived from events planning, development and operation services. Sales of goods represented
+revenue derived from procurement and sales of goods to customers from events and non-events. Design services represented revenue from
+design services as requested by customers. The following table sets forth our revenue for the years ended March 31, 2023 and 2024:
+
+ 
+
+ 
+ 
+ Year
+ ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Provision
+ of event management services 
+ $1,907,953 
+ $6,733,049 
+
+ 
+ Sales
+ of goods 
+ 
+ 
+
+ 
+ Sales
+ of goods from events 
+ - 
+ 5,842,727 
+
+ 
+ Sales
+ of goods from non-events 
+ 1,210,704 
+ 5,616,637 
+
+ 
+ 
+ 1,210,704 
+ 11,459,364 
+
+ 
+ 
+ 
+ 
+
+ 
+ Design
+ and others 
+ 496,480 
+ 2,248,270 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total: 
+ $3,615,137 
+ $20,440,683 
+
+ 
+
+ 
+
+Our
+total revenue increased by approximately HK$16.8 million, or approximately 465%, to approximately HK$20.4 million for the year ended
+March 31, 2024 from approximately HK$3.6 million for the year ended March 31, 2023. This increase was mainly attributable to the end
+of the COVID-19 pandemic lock down policies resulting in the revival of in-person events and the increase of our provision of event management
+services and sales of goods sold during the year ended March 31, 2024. There were no sales of goods from events during the year ended
+March 31, 2023 due to the fact that we only provided event management services without sales of goods for the event during the year ended
+March 31, 2023.
+
+ 
+
+For
+the years ended March 31, 2023 and 2024, revenue was mainly generated from clients located in Hong Kong.
+
+ 
+
+Cost
+of revenues
+
+ 
+
+ 
+ 
+ Year
+ ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Sub-contracting
+ fee from event facilitators 
+ $1,030,637 
+ $1,746,648 
+
+ 
+ Cost
+ of goods sold for IP products 
+ 924,011 
+ 5,068,822 
+
+ 
+ Staff
+ costs 
+ 857,749 
+ 1,746,232 
+
+ 
+ Royalty
+ fee 
+ 321,200 
+ 297,909 
+
+ 
+ Other
+ costs 
+ 128,991 
+ 2,500,878 
+
+ 
+ Total: 
+ $3,262,588 
+ $11,360,489 
+
+ 
+
+ 
+
+For
+the years ended March 31, 2023 and 2024, our cost of revenues was mainly comprised of cost of goods sold for IP products, staff costs,
+subcontracting fees from event facilitators, royalty fees for short term use of IP and other costs related to rental equipment for events
+and decoration. For the years ended March 31, 2023 and 2024, our cost of revenues amounted to approximately HK$3.2 million and HK$11.4
+million, respectively. The increase in costs of revenue during the year ended March 31, 2024 was in line with the increase in revenue
+from provision for event management and sales of goods.
+
+ 
+
+ -68-
+
+ 
+
+ 
+
+ 
+
+General
+and Administrative expenses
+
+ 
+
+The
+following table sets forth the breakdown of our general and administrative expenses for the years ended March 31, 2023 and 2024:
+
+ 
+
+ 
+ 
+ Year
+ Ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Accounting
+ fee 
+ $16,000 
+ $24,000 
+
+ 
+ Bank
+ charges 
+ 12,051 
+ 3,760 
+
+ 
+ Insurance
+ expenses 
+ 3,298 
+ 30,376 
+
+ 
+ Staff
+ costs 
+ 395,000 
+ 232,956 
+
+ 
+ Office
+ expenses 
+ 17,954 
+ 329,360 
+
+ 
+ Miscellaneous
+ such as company directory, business trip and sundry expenses
+ 
+ 46,333 
+ 45,834 
+
+ 
+ Total: 
+ $490,636 
+ $666,286 
+
+ 
+
+ 
+
+Our
+general and administrative expenses amounted to approximately HK$0.49 million and approximately HK$0.67 million for the years ended March
+31, 2023 and 2024, respectively. The increase was mainly due to the increase in office expenses for software purchased during the year
+ended March 31, 2024.
+
+ 
+
+Depreciation
+
+ 
+
+Depreciation
+mainly represented depreciation expenses incurred for equipment and right-of-use assets for office premises and motor vehicle. Depreciation
+amounted to approximately HK$0.2 million and approximately HK$0.3 million, respectively, during the years ended March 31, 2023 and 2024.
+
+ 
+
+ -69-
+
+ 
+
+ 
+
+ 
+
+Other
+Income/ (Expense), Net
+
+ 
+
+The
+following table sets forth the breakdown of our other income/(expense) for the years ended March 31, 2023 and 2024:
+
+ 
+
+ 
+ 
+ Year
+ ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Government
+ grant 
+ $48,000 
+ $178,124 
+
+ 
+ Bank
+ interest income 
+ 441 
+ 22,995 
+
+ 
+ Finance
+ costs 
+ (179,651) 
+ (246,262)
+
+ 
+ Gain/(Loss)
+ on early termination of leases 
+ (7,480) 
+ 2,539 
+
+ 
+ Total 
+ $(138,690) 
+ $(42,604)
+
+ 
+
+ 
+
+Other
+income/(expenses) mainly represented government grant received in relation to the funding support from the Employment Support Scheme
+under the Anti-epidemic Fund during the year ended March 31, 2023 and technology voucher program set up by the Hong Kong Government during
+the year ended March 31, 2024. Finance costs represented the interest expenses for bank borrowings and finance lease during the years
+ended March 31, 2023 and 2024. The decrease in other expenses was mainly attributable to the net result of the increase of one-off government
+subsidies in relation to technology voucher program during the year ended March 31, 2024 and increase in finance costs.
+
+ 
+
+Income
+Tax Expenses
+
+ 
+
+During
+the year ended March 31, 2023, there was no income tax expenses. We generated no assessable income for the fiscal year under the local
+tax regime, after tax adjustments.
+
+ 
+
+During
+the year ended March 31, 2024, the income tax expenses of approximately HK$0.99 million was recognized as we generated no assessable
+income for the fiscal year under the local tax regime, after tax adjustments.
+
+ 
+
+Net
+Profit/(Loss)
+
+ 
+
+As
+a result of the foregoing, our net profit for the six months ended September 30, 2023 amounted to approximately HK$3.8 million while
+our net profit for the six months ended September 30, 2024 amounted to approximately HK$31 million, and our net loss for the year
+ended March 31, 2023 amounted to approximately HK$0.48 million while our net profit for the year ended March 31, 2024 amounted to approximately
+HK$7.09 million.
+
+ 
+
+Liquidity
+and Capital Resources
+
+ 
+
+Our
+liquidity and working capital requirements primarily related to our operating expenses. Historically, we have met our working capital
+and other liquidity requirements primarily through cash generated from our operations. Going forward, we expect to fund our working capital
+and other liquidity requirements from various sources, including cash generated from our operations, loans from banking facilities, the
+net proceeds from this offering and other equity and debt financings as and when appropriate.
+
+ 
+
+ -70-
+
+ 
+
+ 
+
+ 
+
+Cash
+flows
+
+ 
+
+The
+following table summarizes our cash flows for the years ended March 31, 2023 and 2024:
+
+ 
+
+ 
+ 
+ Year
+ ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Net
+ cash provided by/(used in) operating activities 
+ $(239,813) 
+ $8,281,946 
+
+ 
+ Net
+ cash provided by/(used in) investing activities 
+ 441 
+ (110,860)
+
+ 
+ Net
+ cash provided by/(used in) financing activities 
+ 232,338 
+ (4,682,217)
+
+ 
+ Net
+ change in cash and cash equivalent 
+ (7,034) 
+ 3,488,869 
+
+ 
+ BEGINNING
+ OF YEAR 
+ 335,248 
+ 328,214 
+
+ 
+ END
+ OF YEAR 
+ $328,214 
+ $3,817,083 
+
+ 
+
+ 
+
+Cash
+flows from operating activities
+
+ 
+
+For
+the year ended March 31, 2024, our net cash generated from operating activities was approximately HK$8.3 million, which primarily consisted
+of our net profit before tax of approximately HK$8.1 million, mainly adding back (i) the non-cash depreciation of right of use assets
+of approximately HK$0.29 million and finance costs of approximately HK$0.25 million, (ii) the increase in contract assets for upcoming
+events of approximately HK$4.3 million, increase in accounts receivable of approximately HK$0.8 million for receivables not yet settled
+as at March 31, 2024 and was partially offset by (iii) increase in trade and other payable of approximately HK$1.4 million for payables
+incurred for upcoming events and increase in contract liabilities of approximately HK$3.6 million due to advanced payment from customer
+for provision of asset management services to be performed subsequent to the balance sheet date.
+
+ 
+
+For
+the year ended March 31, 2023, our net cash used in operating activities was HK$0.24 million, which primarily consisted of our net loss
+before tax of HK$0.48 million, mainly adding back (i) the non-cash depreciation of right of use assets of approximately HK$0.2 million
+and finance costs of approximately HK$0.18 million, (ii) the increase in deposit, prepayment and other receivables of approximately HK$0.14
+million mainly due to new office premises lease entered during the year.
+
+ 
+
+Cash
+flows from investing activities
+
+ 
+
+For
+the year ended March 31, 2024, our net cash used in investing activities was approximately HK$0.11 million, for the purchase of equipment.
+
+ 
+
+For
+the year ended March 31, 2023, our net cash provided by investing activities was only HK$441 from interest income.
+
+ 
+
+Cash
+flows from financing activities
+
+ 
+
+For
+the year ended March 31, 2024, our net cash used in financing activities was approximately HK$4.7 million which was mainly due to the
+net increase of amount due from a shareholder of HK$3.7 million and the repayment of bank borrowings and lease liabilities.
+
+ 
+
+For
+the year ended March 31, 2023, our net cash provided by financing activities was approximately HK$0.23 million which was the net result
+of the proceeds from bank borrowings of approximately HK$3.6 million, the net increase in due from a shareholder and repayment of bank
+borrowings and lease liabilities.
+
+ 
+
+Capital
+commitments
+
+ 
+
+As
+of March 31, 2023 and 2024, we did not have any capital commitments.
+
+ 
+
+Key
+Factors Affecting our Results of Operations
+
+ 
+
+Our
+financial condition and results of operation have been and will continue to be affected by a number of factors, many of which may be
+beyond our control, including those factors set out in the section headed , ' ': , ' ': Risk Factors in this prospectus.
+These factors include the following:
+
+ 
+
+ 
+ 
+ 
+ Economic
+ conditions of Hong Kong and Asian markets: our revenues may significantly be affected by economic conditions of places for the events
+ to be convened for events and sold of goods. A slowdown in the economy, such as deterioration of overall economic sentiment may decrease
+ the willingness of customers for the events and purchased of IP products, which in turn may decrease their need on overall our services
+ and products, and affect our operating business performance;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Dependence
+ on key customer: our revenues may significantly be affected by the demands of our key customer due to market competitions such as
+ pricing strategy offered by competitors;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Limited
+ vendors for events facilitators and IP products: our costs for goods to be sold for IP products may significantly be affected due
+ to limited vendors for events facilitators and IP products;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Ability
+ to manage staff costs: any upward changes in our staff costs that are not in proportion to an increase in our revenues would impact
+ our results of operations negatively;
+
+ 
+ 
+
+ -71-
+
+ 
+
+ 
+
+ 
+
+Off-Balance
+Sheet Transactions
+
+ 
+
+As
+of March 31, 2024, we have not entered into any material off-balance sheet transactions or arrangements.
+
+ 
+
+We
+have not entered into any financial guarantees or other commitments to guarantee the payment obligations of any third parties. In addition,
+we have not entered into any derivative contracts that are indexed to our own shares and classified as shareholders equity, or
+that are not reflected in our consolidated financial statements. Furthermore, we do not have any retained or contingent interest in assets
+transferred to an unconsolidated entity that serves as credit, liquidity or market risk support to such entity. Moreover, we do not have
+any variable interest in an unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages
+in leasing, hedging or research and development services with us.
+
+ 
+
+Critical
+Accounting Policies and Estimates
+
+ 
+
+Our
+financial statements and accompanying notes have been prepared in accordance with IFRS accounting standards. The preparation of these
+financial statements and accompanying notes requires us to make estimates and judgments that affect the reported amounts of assets, liabilities,
+revenues and expenses, and related disclosure of contingent assets and liabilities. We base our estimates on historical experience and
+on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis of making
+judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. We have identified certain
+accounting policies that are significant to the preparation of our financial statements. These accounting policies are important for
+an understanding of our financial condition and results of operation. Critical accounting policies are those that are most important
+to the portrayal of our financial conditions and results of operations and require management s difficult, subjective, or complex
+judgment, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in
+subsequent periods. Certain accounting estimates are particularly sensitive because of their significance to financial statements and
+because of the possibility that future events affecting the estimate may differ significantly from management s current judgments.
+While our significant accounting policies are more fully described in Note 2 to the consolidated financial statements included elsewhere
+in this prospectus, we believe the following critical accounting policies involve the most significant estimates and judgments used in
+the preparation of our financial statements.
+
+ 
+
+ -72-
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Revenue
+ Recognition
+
+ 
+ 
+
+We
+adopted Accounting Standards Revenue
+from Contracts with Customers (IFRS 15), which provided the following overview of how revenue is recognized from the Company s
+contracts with customers: The Company recognizes revenue to depict the transfer of promised goods or services to customers in an amount
+that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services.
+
+ 
+
+Step
+1: Identify the contract(s) with a customer.
+
+ 
+
+Step
+2: Identify the performance obligations in the contract.
+
+ 
+
+Step
+3: Determine the transaction price – The transaction price is the amount of consideration in a contract to which an entity expects
+to be entitled in exchange for transferring promised goods or services to a customer.
+
+ 
+
+Step
+4: Allocate the transaction price to the performance obligations in the contract – Any entity typically allocates the transaction
+price to each performance obligation on the basis of the relative standalone selling prices of each distinct good or service promised
+in the contract.
+
+ 
+
+Step
+5: Recognize revenue when (or as) the entity satisfies a performance obligation – An entity recognizes revenue when (or as) it
+satisfies a performance obligation by transferring a promised good or service to a customer (which is when the customer obtains control
+of that good or service). The amount of revenue recognized is the amount allocated to the satisfied performance obligation. A performance
+obligation may be satisfied at a point in time (typically for promises to transfer goods to a customer) or over time (typically for promises
+to transfer service to a customer).
+
+ 
+
+We
+identified the following three types of performances under the event management contract: i) events planning, design, development and
+operation, or the Event Management Services; ii) Procurement and sales of goods to customer; iii) sponsorship commission income. Our
+revenue is derived from contracts with customers in the rendering of Event Management Services, and as such, the revenue recognized depicts
+the transfer of promised services to our customers in an amount that reflects the consideration to which we expect to be entitled in
+exchange for those services when the events start. We consider the terms of the contract and all relevant facts and circumstances when
+applying this guidance. The duration of the service period is usually less than one year. We recognize Event Management Services revenue
+when the event starts and during the event period ratably because: i) Based on the contract terms, none of the parties that entered into
+the contract can terminate and find other vendors to substitute the services; and ii) the customer benefits from our service beginning
+at the point of the event started to the event completion. We generally require the customers to make the advanced payment at certain
+percentage of the total contract value upon signing the agreement. Contract liabilities are recorded when the advanced payment is received
+from the customers before all of the relevant criteria for revenue recognition has been met. The event management contract price is on
+a lump sum basis, consisting of sales of goods and Event Management Services consideration. For allocation of transaction price of sales
+of goods and Event Management Services, we applied cost plus margin method to determine the sales of goods revenue based on standalone
+sales of goods gross margin and allocate the remaining provision consideration into event management services. For sponsorship commission
+income, there is specified percentage calculation based on sponsorship fee raised (if any).
+
+ 
+
+For
+sponsorship commission income, it is sponsorship for the whole event period and recognized over the event period align with Event Management
+Services.
+
+ 
+
+Revenue
+from sales of goods is recognized at a point in time when control of the goods has been transferred to the customers. Control is primarily
+evidenced by taking physical possession and inventory risk of the goods. We control the goods and determine the selling price or allocated
+selling price (under event management services contracts) of the good before the good is transferred to the customers.
+
+ 
+
+Revenue
+from designed services is recognized over time. The revenue generated from design services is generally based on the fixed fee billing
+arrangements that require the clients to pay a pre-established fee in exchange for a predetermined set of design services. The design
+services provide involve a series of tasks which are distinct and meet the criteria for recognizing revenue over time. In addition, we
+conclude that the services provided each month are substantially similar and result in the transfer of substantially similar services
+to the clients each month. We recognize revenues from design services on a monthly basis when we satisfy our performance obligations
+throughout the contract terms. Due to the design works being performed by in-house designer and/or monitored by in-house designer through
+external designer (value added services), we control the specified designed services before that services are transferred to a customer
+and thus, we are the principal instead of agent for design services. We will determine the selling price based on the facts above.
+
+ 
+
+ -73-
+
+ 
+
+ 
+
+ 
+
+Recent
+Accounting Pronouncements
+
+ 
+
+See
+the discussion of the recent accounting pronouncements contained in Note 2 to the consolidated financial statements, "Summary of
+Significant Accounting Policies".
+
+ 
+
+Quantitative
+and Qualitative Disclosures about Market Risk
+
+ 
+
+Credit
+Risk
+
+ 
+
+Financial
+instruments that potentially subject us to credit risk consist of cash equivalents and accounts receivable. Cash equivalents are maintained
+with high credit quality institutions, the composition and maturities of which are regularly monitored by management. The Hong Kong Deposit
+Protection Board pays compensation up to a limit of HKD500,000 if the bank with which an individual/a company hold its eligible deposit
+fails. As of March 31, 2024 and September 30, 2024, cash and bank balances of HKD3,817,083 and HKD1,363,152 were maintained at financial
+institutions in Hong Kong, of which none of our cash balance was subject to credit risk. However, if the individual bank balance is over
+HKD500,000, the excess will be subject to credit risk if the relevant bank fails. While management believes that these financial institutions
+are of high credit quality, we also continually monitor their credit worthiness.
+
+ 
+
+For
+accounts receivable, we determine, on a continuing basis, the probable losses and set up an allowance for doubtful accounts based on
+the estimated realizable value. We have adopted a policy of only dealing with creditworthy counterparties. We perform ongoing credit
+evaluation of our counterparties financial condition and generally do not require a collateral. We also consider the probability
+of default upon initial recognition of assets and whether there has been a significant increase in credit risk on an ongoing basis throughout
+each reporting period.
+
+ 
+
+We
+have determined the default event on a financial asset to be when internal and/or external information indicates that the financial asset
+is unlikely to be received, which could include default of contractual payments due for more than 90 days, default of interest due for
+more than 365 days or there is significant difficulty of the counterparty. To minimize credit risk, we have developed and maintained
+our credit risk grading to categorize exposures according to their degree of risk of default. The credit rating information is supplied
+by publicly available financial information and our own trading records to rate our major customers and other debtors.
+
+ 
+
+As
+of March 31, 2024 and September 30, 2024, there were accounts receivables of HKD826,687 and HKD7,041,845, respectively. Two customers
+as of March 31, 2024 and September 30, 2024 amounted to 10% or more of the total consolidated amounts.
+
+ 
+
+Interest
+rate risk
+
+ 
+
+As
+the Company has no significant interest-bearing assets, the Company s income and operating cash flows are substantially independent
+of changes in market interest rates.
+
+ 
+
+Economic
+and political risk
+
+ 
+
+The
+Company s major operations are conducted in Hong Kong. Accordingly, the political, economic, and legal environments in Hong Kong,
+as well as the general state of Hong Kong s economy may influence the Company s business, financial condition, and results
+of operations.
+
+ 
+
+Liquidity
+risk
+
+ 
+
+Liquidity
+risk is the risk that we will not be able to meet our financial obligations as they become due. Our policy is to ensure that we have
+sufficient cash to meet our liabilities when they become due, under both normal and stressed conditions, without incurring unacceptable
+losses or risking damage to our reputation. A key risk in managing liquidity is the degree of uncertainty in the cash flow projections.
+If future cash flows are fairly uncertain, the liquidity risk increases. Liquidity risk is controlled by the application of financial
+position analysis and monitoring procedures. When necessary, we will turn to financial institutions and related parties to obtain short-term
+funding to cover any liquidity shortage.
+
+ 
+
+ -74-
+
+ 
+
+ 
+
+ 
+
+HISTORY
+AND CORPORATE STRUCTURE
+
+ 
+
+The
+Company was incorporated in the Cayman Islands on July 5, 2024 under the Companies Act as an exempted company with limited liability.
+On incorporation, our authorized share capital was US$100,000 divided into 1,000,000,000 shares, par value of US$0.0001 each.
+
+ 
+
+Corporate
+Structure
+
+ 
+
+Our
+Company was incorporated in the Cayman Islands on July 5, 2024 under the Companies Act as an exempted company with limited liability.
+On incorporation, our authorized share capital was US$100,000 divided into 1,000,000,000 Class A Ordinary Shares, par value of US$0.0001
+each. Immediately following incorporation, our share capital was held 100% by Ms. Seto as to one Share.
+
+ 
+
+On
+August 19, 2024, Ms. Seto and Kilo Wonders Group Limited, or Kilo Wonders, (being Ms. Yip Ka Ki Cherry, or Ms. Yip s wholly-owned
+company) subscribed 19,059 and 940 Class A Ordinary Shares for cash at par respectively.
+
+ 
+
+On
+August 19, 2024, Ms. Seto, Kilo Wonders and Yield Rights Group Limited, or Yield Rights, subscribed for 4,500,939, 234,059 and 245,000
+Class A Ordinary Shares for cash at par. Ms. Seto and Ms. Yip are existing shareholders of Trendic.
+
+ 
+
+On
+August 20, 2024, Fuji Holdings, a company wholly-owned by Mr. Chang Kin Man, an independent third party, and Prime Crest Holdings Limited,
+or Prime Crest, acquired 225,000 and 245,000 Class A Ordinary Shares from Ms. Seto, representing 4.50% and 4.90% of the entire issued
+share capital of our Company for US$250,000 and US$270,000 respectively, and on August 20, 2024, Allied Target Limited acquired
+from Ms. Seto 230,000 Class A Ordinary Shares, representing 4.60% of the entire issued share capital of our Company for US$255,000.
+
+ 
+
+On March
+6, 2025, one Class A Ordinary Share was allotted and issued to each of Ms. Seto and Kilo Wonders (Ms. Yip s
+nominee) credited as fully paid in consideration of their transferring their entire equity interest in Trendic to our Group.
+Historically, our Group was comprised only of Trendic.
+
+ 
+
+On March 31, 2025 for purposes
+of recapitalization in anticipation of the initial public offering, the Company s shareholders passed resolutions to (i) sub-divide
+each of the issued and unissued shares in its share capital of par value US$0.0001 each into 10 shares of par value US$0.00001 each,
+(ii) to re-classify and re-designate its authorised share capital into 10,000,000,000 shares with a par value of US$0.00001 each comprising
+of (a) 9,500,000,000 Class A Ordinary Shares with a par value of US$0.00001 each and (b) 500,000,000 Class B Ordinary Shares with a par
+value of US$0.00001 each and (iii) to adopt an amended and restated memorandum of association and articles of association reflecting
+such amended share capital and containing the rights, preferences and privileges attached to each class of shares. Concurrently,
+Ms. Seto, Prime Crest, Fuji Holdings, Kilo Wonders, Yield Rights and Allied Target surrendered 16,303,760, 1,045,660, 960,300, 1,002,980,
+1,045,660 and 981,640 Class A Ordinary Shares to the Company, respectively.
+
+ 
+
+On March
+31, 2025 the Company allotted and issued 1,000,000 Class B Ordinary Shares to Ms. Seto for cash at par. Accordingly, on completion
+of this offering, Ms. Seto s aggregate voting power will be 79.13%.
+
+ 
+
+ -75-
+
+ 
+
+ 
+
+ 
+
+Organization
+Chart
+
+ 
+
+The
+following diagram illustrates our corporate structure as of the date of this prospectus and upon completion of our offering based on
+a proposed number of 2,000,000 Class A Ordinary Shares being offered. Unless otherwise stated, all percentages reflect the equity
+interests held by each of our shareholders. Each holder of Class A Ordinary Shares is entitled to one vote per Class A Ordinary Share
+and each holder of Class B Ordinary Share is entitled to 12 votes per one Class B Ordinary Share.
+
+ 
+
+ 
+
+ 
+
+Notes:
+
+ 
+
+ (1)
+ Prime
+ Crest is wholly-owned by Mr. Cheung Sze Wah, Sam, an independent third party.
+
+ (2)
+ Fuji
+ Holdings is wholly-owned by Mr. Chang Kin Man, an independent third party.
+
+ (3)
+ Kilo
+ Wonders is wholly-owned by Ms. Yip, an independent third party and an existing shareholder of Trendic.
+
+ (4)
+ Yield
+ Rights is wholly-owned by Ms. Lau Wing Yu, an independent third party.
+
+ (5)
+ Allied
+ Target Limited is wholly-owned by Mr. Cheung Ching Ping, an independent third party.
+
+ *
+ Represents
+ voting interest.
+
+ #
+ Takes into account the sale of 660,000 Class A Ordinary
+ Shares by Ms. Seto in the offering.
+
+ 
+
+Other
+than Ms. Seto, none of the other shareholders have held any position, office or other material relationship with the Company or any of
+its predecessors or affiliates within the past three years.
+
+ 
+
+Entity
+
+ 
+
+A
+description of our principal operating subsidiary is set out below.
+
+ 
+
+Trendic
+International Limited
+
+ 
+
+Our
+HK operating company, Trendic, was incorporated in Hong Kong as a private company limited by shares on April 11, 2016. Following an internal
+Group reorganization on March 6, 2025, Trendic became our indirect wholly-owned subsidiary. Since its incorporation, Trendic has been
+carrying on the business of an event management service provider specializing in assisting event organizers in organizing, planning,
+promoting and managing themed tour walk-through experience events for IP owners of characters in well publicized animated cartoons and/or
+live action theatrical motion pictures.
+
+ 
+
+ -76-
+
+ 
+
+ 
+
+ 
+
+BUSINESS
+
+ 
+
+Our
+Mission
+
+ 
+
+Events
+are activities that are planned for a special purpose and usually involve a large number of people. They may also generate revenue for
+host cities, support local businesses and create employment opportunities. Our mission is to help our customers organize, plan, promote
+and manage events to effectively connect with their target audiences and to support the Hong Kong government s initiative to boost
+a mega events economy in Hong Kong by expanding the breadth and depth of our event management, design and/or merchandising services,
+thus expanding our market share in the events industry in Hong Kong as well as to develop more overseas markets for our event management
+and merchandising businesses.
+
+ 
+
+Overview
+
+ 
+
+We
+are an event management service provider based in Hong Kong with over eight years of experience in managing the entire or part of the
+event lifecycle for our customers. Events encompass a range of public and private events, from trade shows, conferences, concerts, exhibitions,
+charity galas, brand promotion events to internal corporate events. For enterprises, events offer a highly effective way to maximize
+their engagement with customers, helping enterprises to generate and qualify leads, deepen relationships with customers and build brand
+loyalty and advocacy, such as promotion of a brand by satisfied customers through customers sharing positive experiences on social media,
+providing referrals to friends and family, or simply telling others about the brand.
+
+ 
+
+We
+are an event planner specializing in organizing, planning, promoting and managing themed touring walk-through experience events,
+or experience events, for intellectual property owners, or IP owners, of characters in well-publicized animated cartoons and/or live
+action theatrical motion pictures, each a licensed character. This type of experience events typically involve an intellectual property
+license, or IP license, from the IP owner to an event organizer, giving the event organizer the right to develop, organize, plan, promote
+and manage experience events relating to the licensed character and other licensed properties, including the name of the licensed character,
+title of the animated cartoon/live action theatrical motion picture, costumes, environmental settings, plot elements and artwork together
+as the licensed property in approved venues in a specified number of territories. During the experience event, event attendees may separately
+purchase, in designated area(s) at the approved venue, (i) various interactive activities and/or entertainment, including hands-on active-play/participation
+and/or media-based activities, such as green-screen photo/video capturing activities where guests are offered the opportunity to have
+their photo and/or video taken using green-screen capture technology, or the interactive opportunities; (ii) custom-made merchandise
+featuring the licensed property that are commissioned specially for the experience event, or the custom-made merchandise, as well as
+other licensed merchandise featuring the licensed property that are supplied by the IP owners and/or its licensee(s); and (iii) food
+and beverage products.
+
+ 
+
+Apart
+from organizing, planning, promoting and managing experience events, we also engage in the design and/or sale of merchandise, such as
+merchandise sold in concert venues and merchandise used as gift with purchase by our customers, as well as event management for brands,
+such as setting-up and running of pop-up stores and organizing store opening/product launch press events for labels.
+
+ 
+
+The
+events industry around the world, which generally relies on face-to-face experiences to provide more opportunities for deeper engagement,
+networking and interaction, suffered a serious blow during the COVID-19 pandemic, due to measures adopted by the respective
+local governments to stop community spread of the COVID-19 pandemic, including border controls, mandatory quarantine, different
+levels of social distancing measures and/or suspended operations of certain businesses, workplaces and facilities. In the case of Hong
+Kong, the government lifted all the social distancing measures on December 29, 2022. As events are generally planned at least six months
+in advance, the COVID-19 pandemic had a material adverse impact on our business, results of operations and financial condition from the
+beginning of 2019 through the first calendar quarter of 2023.
+
+ 
+
+ -77-
+
+ 
+
+ 
+
+ 
+
+During
+the COVID-19 pandemic, most of the in-person events were rescheduled, postponed or cancelled and our business relied on the design and/or
+sale of merchandise and government subsidies. However, we remained in close contact with other industry players in the field to keep
+ourselves abreast of all available opportunities in the market so that we could seize suitable opportunities in a timely manner to capture
+the pent-up demand from the general public for experience events. As a result of these efforts, our business primarily focused on
+event management business again when things started to normalize after the COVID-19 pandemic, and we signed an experience event management
+deal in Malaysia in each of August 2023 and January 2024.
+
+ 
+
+Following
+the COVID-19 pandemic, there has been a growing trend for event organizers to invite event planners to invest in experience events through
+profit-sharing deals or direct investment deals. For details, see "— Our Business Model" below in this
+section. We explored profit-sharing deals but ultimately decided to engage in direct investment deals instead. During the six months
+ended September 30, 2024, we completed two direct investment deals. At the date of this prospectus, we had eight direct investment deals
+for experience events in Hong Kong or Thailand in the pipeline. In
+the long run, we plan to leverage our industry experience and our connections with IP owners built up over the years to start obtaining
+IP licenses from IP owners directly which will move us up the value chain to become an event organizer and can help us eliminate the
+mark-ups by the event organizers in the direct investment deals which we were engaging at the date of this prospectus.
+
+ 
+
+We
+believe this strategy will position us to expand our market share in the events industry in Hong Kong, especially in view of the
+Hong Kong government s policy to boost a mega events economy in Hong Kong. For the years ended March 31, 2023 and 2024, our net
+revenue amounted to approximately HK$3.6 million and approximately HK$20.4 million, respectively, with an increase of approximately 465%.
+For the six months ended September 30, 2023 and 2024, our net revenue amounted to approximately HK$3.8 million and approximately HK$31.0
+million, respectively, with an increase of approximately 722%. Due to our business expansion and the end of the COVID-19 pandemic
+lock down policies by the HK government, we recorded a net loss for the year ended March 31, 2023 amounting to approximately HK$0.48
+million compared to a net profit for the year ended March 31, 2024 amounting to approximately HK$7.09 million. For the six months
+ended September 30, 2023 and 2024, our net profit has increased from approximately HK$1.4 million to approximately HK$2.7 million, representing
+an increase of approximately 100%.
+
+ 
+
+Our
+Competitive Strengths
+
+ 
+
+We
+believe the following competitive strengths have contributed to our success to date and will continue to distinguish us from our competitors:
+
+ 
+
+We
+have an established reputation and proven track record in the events industry 
+
+ 
+
+We
+have over eight years of experience in providing event management, design and merchandising services in Hong Kong. We have organized
+and managed numerous events ranging from theme exhibitions, pop-up stores, store opening/product launch press events for labels,
+festive theme displays and experience events, most of which involved IP licenses and sales of merchandise, food and beverage. In our
+over eight years of operation, we have completed more than 30 large-scale projects which can accommodate over 3,500 attendees at the
+same time and 60 small to medium-sized projects which can accommodate between 1,000 to 3,500 attendees in Hong Kong, Macau, Taiwan, the
+PRC and other Southeast Asian countries, including Malaysia and Thailand; and worked with, whether directly or indirectly, more than
+15 IP owners, 15 event organizers and 30 brand owners/franchisees/distributors based in Hong Kong, Taiwan, Japan and the United States.
+Through this journey, we have built up deep domain expertise on how to maximize event success and we have also established a good rapport
+with a number of IP owners, event organizers and brand owners, franchisees, distributors and some of them have become our recurring customers.
+We believe this proven track record is testimony to our ability to consistently meet customers expectations and requirements,
+as well as our strength in providing customized, value-added, quality and efficient event management, design and merchandising services
+to our customers. We also believe that we can capitalize on our industry reputation and good relationship with IP owners, event organizers
+and brand owners/franchisees/distributors to procure new engagements and capture emerging market opportunities.
+
+ 
+
+ -78-
+
+ 
+
+ 
+
+ 
+
+We
+have the ability to manage the entire event lifecycle 
+
+ 
+
+As
+an experienced event management service provider, we can manage the entire event lifecycle for different types of events, from event
+inception (such as researching on and conceptualizing an event s theme and selecting venue and other service providers like public
+relationship, or PR, firm and contractor), managing budgets, preparing all relevant event plans and proposals for IP owner s
+approval, promoting the event, orchestrating the intricate details that ensure the event runs smoothly to post-event follow-up (such
+as collecting monies and reporting back to our customers and collating event attendees feedback). Apart from these conventional
+event management services, we also have our own inhouse designers and merchandisers who can assist our customers in designing and commissioning
+the production of custom-made merchandise, as well as a project executive who can assist our customers in developing themed food and
+beverage menus and lining up caterers to prepare the food and beverages. The depth and breadth of our professional event management services
+facilitate us to provide a one-stop solution to our customers, giving them peace of mind and better control over their events.
+
+ 
+
+Our
+management team possesses extensive events industry experience and business network
+
+ 
+
+Our
+founder, director and chief executive officer, Ms. Seto, is an accomplished businessperson. She gained solid work experience in the apparel
+industry before becoming an entrepreneur. Before she established Trendic, she established and acquired local fashion labels and also
+acquired the distribution rights of an international fashion label in Hong Kong and Taiwan. One of these local fashion labels collaborates
+with many IP owners on crossover apparel and gift collections featuring licensed property and some of these crossover products have been
+sold in pop-up stores with food and beverage offerings. Her family is also an active concert promoter in Asia. All these business engagements
+and affiliations have helped Ms. Seto to build networking connections with a wide range of industry players, including IP owners, apparel
+and gift manufacturers, PR firms, operators of shopping malls, contractors, artiste management, media, concert and exhibition venue operators,
+just to name a few. Leveraging these business connections and in view of the increasing demand for theme exhibitions from the leisure
+and hospitality industry in Macau, Ms. Seto established Trendic in 2016 to design and produce merchandise featuring licensed property
+for consignment sales at these theme exhibitions in Macau and also started the provision of event management services in Hong Kong, Malaysia
+and Taiwan. Ms. Seto s network connections continue to grow over our operating history which helps to smoothly operate the organization
+and planning of experience events for our customers and ensure that the experience events can be executed in a cost-effective and efficient
+manner. This in turn has helped us retain customers and attract new customers.
+
+ 
+
+ -79-
+
+ 
+
+ 
+
+ 
+
+Ms.
+Seto s extensive industry knowledge and experience as well as her vision, strategic planning and management are instrumental in
+steering us through the COVID-19 pandemic and our rapid recovery and growth afterwards. Ms. Seto is supported by Ms. Tse, a director
+and the head of the design and merchandising department, Mr. Leung Tak Shun, who will begin serving as our chief financial officer
+immediately upon the SEC s declaration of effectiveness of our registration statement on Form F-1, of which
+this prospectus forms a part, and Mr. Luk Kai Chung, the general manager, who collectively possesses expertise across event management, design, sourcing,
+logistics, marketing, budget control, customer service, accounting and financial management. We believe that the collective knowledge,
+experience and expertise of Ms. Seto, the other director and our senior management will help us develop sustainable business strategies,
+forecast trends in experience events and anticipate our customers needs in event management and merchandise, assess and manage
+risks as well as to capture profitable market opportunities. We believe that our management team possesses the necessary experience,
+qualifications, commitment and leadership skills to manage and sustain our business, which helps us to attract and retain customers and
+to ensure that our business continues to develop and grow in the long run, as evident by the recurring business from our customers.
+
+ 
+
+We
+have built a good relationship with an established network of service providers that are essential for our operations 
+
+ 
+
+As
+veterans in the events industry, our management team has established close working relationships with a wide network of service providers
+that are essential for our operations, including overseas event companies and local event companies that have overseas operations, apparel
+and gift manufacturers, PR firms, contractors, human resources companies, caterers, operators of event venues and artiste management.
+This enables us to target the specific needs and demands of our customers by promptly lining up appropriate third-party service providers
+to support us in the organization, planning, promotion and management of the events for our customers in a cost-effective, efficient
+and timely manner, as well as allowing us to provide a wide range of event management, design and merchandising services to our customers
+with minimal staff and overhead costs and a relatively simple business structure. For instance, through appointing overseas event companies
+to act as our local facilitators, we are able to strategically expand our market presence to overseas markets and organize and plan experience
+events in overseas countries without having the complexity and cost of operating our own local office and staff in such countries. By
+working closely with human resources companies, we are able to quickly find suitable temporary workers to support us when we are in need
+of a certain type of personnel at any stage of the event lifecycle. In certain cases, we are also able to obtain discounts and/or other
+preferential treatments from these service providers due to our good relationship with them. This helps to lower the overall costs of
+the events and ensure the events smooth operation.
+
+ 
+
+Our
+creative offerings help to ensure the profitability of experience events 
+
+ 
+
+We
+specialize in the organization, planning, promotion and management of experience events. For a typical experience event, tickets sales
+only account for approximately half of the income and the other half generally comes from the sales of merchandise, food and beverage
+and other interactive opportunities. To maximize the income from experience events, we are capable of putting together
+novel marketing plans to promote ticket sales to the target audience who are generally fans of the licensed characters. For instance,
+we leverage our design capability to create collectible limited edition custom-made merchandise, some of which are provided free of charge
+to the first 100 event attendees only or only available to event attendees that purchase early bird special bundle tickets to promote
+ticket sales and create hype for the experience event. We also design custom-made merchandise and visually appealing food and beverage
+items featuring the licensed property which are only available for sale at the event venue, which helps to enhance ticket sales as well
+as generate ancillary income from sales of merchandise, food and beverages. All of these offerings will help to ensure the profitability
+of the experience events we organize, plan, promote and manage.
+
+ 
+
+ -80-
+
+ 
+
+ 
+
+ 
+
+We
+have our own event venue
+
+ 
+
+From
+our experience, it generally takes a significant amount of time and effort to identify and negotiate for a suitable event venue. It is
+also time-consuming and costly to build and demolish the zoning partitions and to apply for the relevant permits for each individual
+experience event. Moreover, short-term leases are typically more expensive than long term ones and it may also be hard for us to match
+the availability of event venues with the planned event dates. In an attempt to reduce the costs and increase the efficiency of the experience
+events that we organize, we entered into a 15-month lease in June 2024 for an event venue in Hong Kong which is located in a shopping
+mall with high footfall and can be accessed conveniently by public transport. Please see "—Real Property"
+below for details. As of the date of this prospectus, we had organized two experience events in this event venue and we have plans
+to organize four more experience events that we have committed contractually in this event venue. We do not have a high capital
+commitment for this event venue as we mainly pay turnover rent. Apart from the time and cost benefits, there may also be synergistic
+benefits as that event venue may become an experience event hub to help us and our customers connect to our/their target
+audience and provide us/them with the opportunity to cross-sell our/their other events.
+
+ 
+
+Our
+Business Strategies
+
+ 
+
+We
+plan to continue to expand the breadth and depth of our event management, design and merchandising services, thereby expanding our market
+share in the events industry in Hong Kong as well as to develop more overseas markets for our event management and merchandising businesses.
+To achieve these business goals, we plan to:
+
+ 
+
+ build
+ on our
+ core business as an event planner and move up the value chain from a pure service provider
+ to also play the role of an event organizer;
+
+ 
+
+ obtaining
+ multi-territorial
+ IP licenses from IP owners to help us increase our market share in Hong Kong and further
+ develop overseas markets;
+
+ build
+ our
+ own ticketing platform to facilitate direct marketing of the events we organize and the collection
+ of full engagement data on event attendees; and
+
+ 
+
+ expand
+ our
+ project department and finance and administration department, set up a new sales and marketing
+ department and an information technology department as well as to upgrade our enterprise
+ resource planning, or ERP, system.
+
+ 
+
+Our
+Services
+
+ 
+
+As
+an experienced event management, design and merchandising service provider, we can manage the entire event lifecycle and deliver
+engaging experiences across a wide range of events, including the following:
+
+ 
+
+ conducting
+ research and feasibility studies for the event;
+
+ 
+
+ -81-
+
+ 
+
+ 
+
+ 
+
+ developing
+ and planning the event, including choice of venue, concept development, layout of venue,
+ types and pricing of tickets, choice of ticketing platforms and choice of contractors for
+ fitting-out the event venue;
+
+ 
+
+ preparing
+ all relevant planning proposals for the IP owner s approval;
+
+ 
+
+ setting
+ and managing the budget for the event;
+
+ 
+
+ advertising
+ and promotion of the event to the target audience, such as preparation of promotional materials,
+ putting posts in social media and setting up a website for the event;
+
+ 
+
+ preparing
+ a detailed implementation plan for the event with timetable for execution;
+
+ 
+
+ managing
+ and supervising the implementation of the event;
+
+ 
+
+ obtaining
+ all required permits for the event, such as certificate of compliance from the Fire Services
+ Department, temporary license for places of public entertainment and license for holding
+ a food and environmental hygiene event;
+
+ 
+
+ arranging
+ for all relevant insurance policies, such as public liability policy, contractor s
+ all risk insurance and transit insurance;
+
+ 
+
+ coordinating
+ all relevant parties, such as the venue operator, contractors responsible for fitting-out
+ the event venue, ticketing platforms, PR firms and the media;
+
+ 
+
+ coordinating
+ all logistical elements of the event, such as layout, agenda, staff, equipment, merchandise
+ and transportation;
+
+ 
+
+ designing
+ the custom-made merchandise and managing the product development, sourcing, production management,
+ quality control, logistics and sales processes for such merchandise;
+
+ 
+
+ designing
+ the food and beverage menu and arranging for food and beverage;
+
+ 
+
+ 
+
+A
+sample menu and a sample food item featuring licensed property offered in one of the events we organized recently.
+
+ 
+
+ -82-
+
+ 
+
+ 
+
+ 
+
+ 
+ arranging
+ for lodging for event attendees (if ticket bundles include hotel accommodation);
+
+ 
+
+ 
+ soliciting
+ sponsors for the event;
+
+ 
+
+ 
+ arranging
+ for travel and lodging for IP owner s supervising team;
+
+ 
+
+ 
+ preparing,
+ reviewing and signing (whether for ourselves or as agent of the event organizer) of all relevant contracts in relation to the
+ event;
+
+ 
+
+ 
+ issuing
+ invoices for all amount due and collecting such amount (such as income from sales of tickets, interactive opportunities, merchandise,
+ food and beverage), managing the payment of invoices received from all service providers and other suppliers, and where appropriate,
+ accounting back to the event organizer/IP owner; and
+
+ 
+
+ 
+ collating
+ data on event attendees and evaluating the event.
+
+ 
+
+Our
+Business Model 
+
+ 
+
+Experience
+events
+
+ 
+
+Our
+core business is the organization, planning, promotion and management of experience events. The following table shows the value chain
+of an experience event for a particular territory under an IP license:
+
+ 
+
+ 
+
+The
+IP owner normally grants an event organizer an IP license to develop, organize, plan, promote and manage experience events relating to
+the licensed property in approved venues in a specified number of territories in return for the event organizer paying royalties (with
+a minimum guarantee) and equipment rental fees (where applicable) to the IP owner. All elements with respect to the experience events,
+including the choice of venue, concept, layout, design and pricing of merchandise, types and pricing of tickets, sponsorship and marketing,
+will all be subject to the IP owner s approval at its absolute discretion. The event organizer will normally commit to spend a
+minimum amount of capital on the initial design, development, construction and opening of the first experience event and then the experience
+event will be toured in the other licensed territories with some local adaptations.
+
+ 
+
+ -83-
+
+ 
+
+ 
+
+ 
+
+The
+event organizer is the investor and host of these experience events. It will typically look for event planners to assist them in the
+organizing, planning, promotion and management of these experience events and the solicitation of sponsors in different territories.
+The event planners serve as the backbone of these experience events as their core functions encompass a wide array of responsibilities
+– from conceptualizing the experience events theme, managing budgets and selecting venues to orchestrating the intricate
+details that ensure the experience events run smoothly. They are generally responsible for preparing all relevant event proposals for
+the event organizer s review and comments. Once these proposals are finalized, the event organizer will submit them to the IP owner
+for approval before the event planner executes the various approved proposals. As the investor and host of these experience events, the
+event organizer will typically sign all relevant contracts with third parties involved in the organization of these experience events,
+including the venue owner/operator, the contractor and the PR firm, and to take out all relevant insurance policies for these experience
+events.
+
+ 
+
+Event
+planners will normally be compensated by an agreed service fee (generally paid in two non-refundable instalments, one shortly after the
+signing of the event management contract and the other before the opening of the experience event) and an agreed percentage of commission
+on the sponsorship income they solicited (generally paid after the experience event). The event planners will account all monies received
+from sponsors and event attendees (including payments collected for tickets, interactive opportunities, merchandise, food and beverage)
+to the event organizer, except in those cases where arrangements have been made for the event organizer to be paid directly.
+
+ 
+
+In
+cases where an event planner has committed for overseas territories for which they do not have any local operations, the event planner
+will typically engage, at its own costs, a local facilitator to assist them with the local logistics, coordination and management of
+the experience event and the solicitation of sponsors in such territory. The remuneration structure and accounting mechanism will be
+similar to that between the event organizer and the event planner.
+
+ 
+
+During
+the fiscal years ended March 31, 2023 and 2024, we had organized or commenced the organization of nil and four experience events,
+respectively, and we acted as the event planner for these experience events with the event organizers as our customers in the above value
+chain. Subject to the terms of the relevant event management contract, the event organizer will generally bear all the costs in relation
+to the experience events, other than the costs of the local facilitator (if any) and/or the human resources companies supplying the temporary
+workers we engaged to assist us in the organization, planning, promotion and management of the experience event. If the event organizer
+would like to also utilize our design and/or merchandising services, it would typically be an arrangement negotiated separately outside
+of our scope of service as an event planner. For details, see "—Design and/or sale of merchandise" below.
+
+ 
+
+ -84-
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+
+ 
+
+Samples
+of the posters of some of the recent experience events which we have organized, planned, promoted and managed.
+
+ 
+
+After
+the COVID-19 pandemic, there is a growing trend for event organizers to invite event planners to invest in experience events in the following
+two ways:
+
+ 
+
+(i)profit-sharing
+ deals whereby event planners have to contribute part of the capital required to secure IP
+ licenses from IP owners in return for a share of the profits generated from the experience
+ events to be organized based on such IP licenses and the first right to pick the territories
+ in which the event planners wish to organize, plan, promote and manage such experience events
+ in the conventional way described in the above value chain; or
+
+ 
+
+(ii)direct
+ investment deals whereby event planners will step into the shoes of the event organizers
+ and become the effective investors of the experience events which they have been commissioned
+ to organize by the event organizers, while they also play the role of event planners described
+ in the above value chain. Under this type of deal, the event organizers would sub-license
+ the full right to organize the experience events to the event planners in return for the
+ event planners paying royalties (with a minimum guarantee) and equipment rental fees (where
+ applicable) to them, and such financial arrangements typically mirrors the financial arrangements
+ between the event organizers and the IP owners except that the event organizers would build
+ in their own margins in the financial arrangements between themselves and the event planners.
+ Event planners would absorb all the production costs of the experience events and take up
+ all the revenue generated from the experience events (including payments collected for tickets,
+ interactive opportunities, merchandise, food and beverage as well as sponsorship). Where
+ appropriate, the event planners may invite the local facilitators to co-organize the experience
+ events with them and take a share of such investment. 
+
+ 
+
+We
+had explored profit-sharing deals with an event organizer and had entered into three agreements with such event organizer in September
+2023 to provide approximately 20% to 30% of the capital required to secure IP licenses from three IP owners for experience events in
+six to eight territories (mostly Asian countries and include Hong Kong in each case) for a term of two to three years. However, no funding
+was ever provided under these agreements. Such agreements were eventually terminated and restructured into direct investment deals for
+the actual experience events which we were interested in organizing instead.
+
+ 
+
+During
+the six months ended September 30, 2024, we had organized or commenced the organization of seven experience events, and we acted as the
+event planner for two of these experience events with the event organizers as our customers in the above value chain. The other five
+experience events were direct investment deals with the event attendees and sponsors as our customers, three of which we co-invested
+with the local facilitators for such experience events. As at the date of this prospectus, we had eight direct investment deals for experience
+events in Hong Kong or Thailand in the pipeline.
+
+ 
+
+In
+the long run, we plan to leverage our industry experience and our connections with IP owners built up over the years to start obtaining
+IP licenses from IP owners directly. This will move us up the value chain to become an event organizer and can help us eliminate the
+mark-ups by the event organizers in the direct investment deals which we were engaging at the date of this prospectus.
+
+ 
+
+Design
+and/or sale of merchandise 
+
+ 
+
+Our
+customers typically pay us an agreed design fee for designing merchandise. For experience events, our customers generally engage us to
+design apparel items, stationery, figurines and pins bearing the licensed property. For other general customers, we can generally design
+any merchandise item based on their request and needs. As of September 30, 2024, we had a team of three designers who are experienced
+in 2D designs to provide our design services. We may also work with external designers if our in-house team of designers are overloaded
+with work.
+
+ 
+
+In
+cases where our customers also require our assistance in managing the processes of product development, sourcing, production management,
+quality control and logistics services, we will typically sell the finished merchandise to our customers at cost-plus pricing.
+
+ 
+
+Whether
+for our design services or merchandising services, our customers generally pay us in two non-refundable instalments, one shortly after
+the signing of the relevant design or merchandising contract and the other before the delivery of the final design work or the finished
+merchandise.
+
+ 
+
+ 
+
+Samples
+of merchandise which we have designed for our customers.
+
+ 
+
+ -85-
+
+ 
+
+ 
+
+ 
+
+Event
+management for brands 
+
+ 
+
+Brand
+owners will normally engage us directly to assist them in the organization, planning, promotion and/or management of their desired events
+and compensate us with an agreed service fee (generally paid in two non-refundable instalments, one shortly after the signing of the
+event management contract and the other before the opening of the event). In cases where product sales will be involved in the event
+(such as setting-up and running of pop-up stores), we can also manage the sales and account back to the brand owners.
+
+ 
+
+Our
+Operations 
+
+ 
+
+Except
+during the COVID-19 pandemic, our principal business operation is the organization, planning, promotion and management of experience
+events as an event planner. Once we have been engaged by an event organizer as an event planner for an experience event or we have
+signed a direct investment deal for an experience event with an event organizer, we will form an internal project team to oversee
+the organization, planning, promotion and management of the experience event. The internal project team will typically comprise of a
+project manager, a project coordinator, a designer, a sourcing executive and a catering coordinator. We will typically execute our job
+in the following four phases:
+
+ 
+
+Phase
+one - Planning 
+
+ 
+
+We
+are typically engaged by the event organizer as an event planner or we typically sign a direct investment deal approximately six
+months before a planned experience event. Our contract with the event organizer will normally specify our respective responsibilities
+and the payment terms. Once the contract is signed, we will research on the theme, market, timing, location, pricing, facilities
+and venue of the proposed experience event, and brainstorm ideas on the experience event with the event organizer to ensure that the
+event is financially and commercially feasible. We will also assist in looking for a suitable event venue (typically an exhibition center
+or a shopping mall) and will procure the event operator to give a non-binding commitment to hold the venue for the provisional dates
+of the experience event pending the IP owner s approval for the venue. If the experience event will be held outside of Hong Kong,
+we will also line up a local facilitator to assist us on a non-committed basis. For direct investment deals, we may also invite the
+local facilitator to take a share of the investment.
+
+ 
+
+Then
+we will prepare an organizer plan with details of our (and where applicable, the local facilitator s) background information and
+credentials; and a venue plan with comprehensive information on the chosen venue (including location, size, floor plan, setting, environment
+and neighborhood, transportation network, and venue operator s support and past track record on experience events) for the IP owner s
+approval.
+
+ 
+
+Once
+the organizer plan and the venue plan have been approved by the IP owner, we will procure the event organizer to sign or we will sign
+the rental agreement with the venue operator (as the case may be) and where applicable, we will sign the collaboration agreement
+with the local facilitator. We will also tentatively line up a contractor to fit-out the event venue and a PR firm to assist us with
+media and promotion activities on a non-committed basis. Then we will move onto the detailed planning of the experience event, including
+the preparation of the following plans:
+
+ 
+
+ 
+ 
+ ticketing
+ plan – with details of the types of ticket and ticket bundle and their pricing, sales timetable and details of the ticketing
+ platforms;
+
+ 
+
+ 
+ 
+ marketing
+ plan – with details and timetable of all online and offline marketing campaigns, the list of media and detailed marketing plan
+ for each type of media and sample promotional materials;
+
+ 
+
+ 
+ 
+ sponsorship
+ plan – with details of the sponsor(s), the support to be provided and the barter involved;
+
+ 
+
+ 
+ 
+ schematic
+ design plan – a layout and zoning plan with detailed design of each area/zone of the experience event, showcasing where the licensed
+ property and/or equipment rented from the IP owner would be exhibited;
+
+ 
+
+ -86-
+
+ 
+
+ 
+
+ 
+
+ 
+
+Sample
+zoning and lay out plans for our recent experience events.
+
+ 
+
+ 
+ 
+ merchandising
+ plan – with (i) details of the pop-up store(s) to be set up at or near the event venue for the sale of merchandise and/or interactive
+ activities; (ii) list of custom-made merchandise with detailed design; (iii) list of licensed merchandise featuring the licensed property
+ to be supplied by the IP owners and/or its licensee(s) for either consignment or sale; and (iv) list of interactive activities to be
+ sold (such as photo-taking in front of a green-screen) with photo illustration;
+
+ 
+
+ 
+ 
+ Food
+ and beverage plan – with details of the pop-up store, concept of the food and beverage to be served and photo illustrations on
+ how licensed property will be featured on some of these food and beverage items (if any); and
+
+ 
+
+ 
+ 
+ operation
+ plan – a document showing details of all the tasks and activities involved in managing the experience event and the people in
+ charge of such task and activities,
+
+ 
+
+We
+will then prepare all relevant proposals for the event organizer s comments or handling (as the case may be). After such
+proposals have been finalized with the event organizer, the event organizer will seek the IP owner s approval on such proposals.
+We will continue to refine such proposals based on the IP owner s feedback communicated to us by the event organizer until they
+have been formally approved by the IP owner. Then we will procure the event organizer to sign contracts or we will sign contracts
+(as the case may be) with all the relevant parties involved, including the contractor, PR firm, ticketing platforms and sponsor(s).
+This planning and approval phase generally takes place approximately four to six months before the opening of the experience event.
+
+ 
+
+Selection
+of service providers for the experience event
+
+ 
+
+If
+we are engaged as an event planner only, the event
+organizer will generally bear all the costs in relation to the experience event, other than the costs of local facilitator (if any) and/or
+the human resources companies supplying the temporary workers we engaged to assist us in the organization, planning, promotion and management
+of the experience event. Although the event organizer will generally enter into contracts and settle payments directly with all the other
+service providers (such as the contractor, the PR firm and the ticketing platforms), we, as the event planner, are responsible for selecting
+all the service providers for the event organizer to seek the IP owner s approval and working closely with them during the preparation
+and management of the experience event to ensure that they will meet contract specifications and schedule within the limit of the agreed
+budget.
+
+ 
+
+ -87-
+
+ 
+
+ 
+
+ 
+
+We
+maintain a list of internally approved service providers and we generally only select service providers from this list unless there are
+other service providers recommended by the event organizer. We generally will obtain quotations from at least two to three service providers
+for the same category of service to compare prices before we submit the shortlist of service providers to the event organizer for review
+before the shortlist is submitted to the IP owner for approval. We generally select a service provider based on the requirements of the
+experience event and assess the service provider s pricing, credit period, expertise, scope of services, facilities, reputation,
+track record, capacity as well as their capability to meet the requirements of the experience event as to theme, design, quality, schedule,
+costs, protection of IP rights and/or safety (as the case may be).
+
+ 
+
+For
+direct investment deals, we generally step into the shoes of the event organizer in the selection of and the dealing with service providers.
+
+ 
+
+Phase
+two – Pre-event preparation
+
+ 
+
+Once
+the IP owner has approved the various proposals, we will (and where applicable, with the assistance of the local facilitator) proceed
+to prepare for the opening of the experience event, including:
+
+ 
+
+ liaising
+ with all relevant parties to ensure that they proceed according to plan pursuant to the relevant
+ contractual terms and where appropriate, supervise their progress;
+
+ 
+
+ where
+ applicable, commissioning the production of custom-made merchandise, ensuring the quality
+ and safety of such merchandise and sending final samples of merchandise for IP owner s
+ quality approval;
+
+ 
+
+ arranging
+ for the logistics of the experience event, including the shipping of all exhibits, equipment
+ and merchandise; 
+
+ 
+
+ obtaining
+ all permits required for the experience event;
+
+ 
+
+ executing
+ and/or supervising the execution of (as the case may be) the marketing plan according to
+ the pre-set timetable (such as the designing and printing of brochures, posters and banners
+ in various sizes, arranging advertisements in major transportation stations and setting up
+ an event website) and continuing to review/update such marketing plan based on the outcome
+ of the completed marketing campaigns;
+
+ 
+
+ commencing
+ ticket sales according to plan;
+
+ 
+
+ taking
+ out all appropriate insurance policies, such as public liability insurance, contractor s
+ all risk insurance and transit insurance;
+
+ 
+
+ preparing
+ a detailed rundown of the experience event identifying all responsible parties, with (i)
+ specifications of all on-site facilities (such as electricity supply) and emergency exits
+ in case of evacuation; (ii) all relevant guidelines and regulations; and (iii) points of
+ contact; 
+
+ -88-
+
+ 
+
+ 
+
+ 
+
+ recruiting
+ temporary workers through human resources companies to assist in the management of the experience
+ event; 
+
+ 
+
+ training
+ of all crew members who would assist in the management of the experience event;
+
+ 
+
+ managing
+ the budget of the experience event and where appropriate, arranging for the event
+ organizer to settle the invoices of all relevant parties; and
+
+ 
+
+ where
+ applicable, arranging transport and lodging for the IP owner s supervising team which
+ provide technical support to ensure the smooth preparation and opening of the experience
+ event.
+
+ 
+
+Approximately
+ten to 20 days before the opening day of the experience event, we will arrange for the contractor to commence the fitting-out of the
+venue. We will also arrange for all exhibits and equipment to be delivered and installed in the venue for test running, training of the
+crew managing the experience event and where applicable, inspection by the IP owner s supervising team, approximately three to
+five days before the opening day of the experience event.
+
+ 
+
+This
+phase normally takes place during the four-month period before the opening of the experience event.
+
+ 
+
+Phase
+three – Managing the experience event
+
+ 
+
+Approximately
+one to three days before the opening day of the experience event, we will organize a media day as a soft opening of the experience event
+for media people (including key opinion leaders and other special guests) to gain first-hand experience on the experience event so that
+they can help to effectively promote and raise public awareness of the experience event. We will also distribute a number of complimentary
+tickets to all parties involved in the preparation of the experience event for them to bring their friends and family to test run the
+experience event on the media day. We will then refine the set-up and/or rundown of the experience event based on the feedback of the
+media day attendees.
+
+ 
+
+On
+the actual opening day, we will organize an official opening ceremony, where we will invite special guests like popular movie stars/singers
+to officiate such ceremony and to create more hype for the experience event. The experience event typically runs for approximately six
+to 13 weeks. After the commencement of the experience event, we will supervise the crew managing the event and act as a coordinator to
+ensure that the event will run smoothly until its conclusion. We will also conduct daily reconciliation of the summary sales records
+in the cash registers with the actual amounts received in cash or by credit card from sales of tickets, interactive opportunities, merchandise,
+food and beverage at the event venue.
+
+ 
+
+ -89-
+
+ 
+
+ 
+
+ 
+
+ 
+
+Local
+and overseas event attendees lining up for tickets to one of our recent events and gathering in the pop-up store set up in the event
+venue to look for their favorite merchandise.
+
+ 
+
+Phase
+four - Post-event
+
+ 
+
+Generally
+within one week after the experience event, we will evaluate the event with the event organizer and prepare all relevant evaluation reports
+for submission to the IP owner based on sales reports submitted by the ticketing platforms, media report submitted by the PR firm and
+the post-event survey which we may conduct. Where appropriate, we will also assist the event organizer in invoicing and collecting
+all monies due from third parties for sales of tickets, interactive opportunities, merchandise, food and beverages, and preparing a full
+comprehensive report accounting for the sales of all tickets, interactive opportunities, merchandise, food and beverages (except in those
+cases where arrangements have been made for the event organizer to be paid directly).
+
+ 
+
+ -90-
+
+ 
+
+ 
+
+ 
+
+Our
+Growth Strategies 
+
+ 
+
+We
+specialize in the organization, planning, promotion and management of experience events and we generally act as the event planner in
+the value chain of an experience event. Ms. Seto envisaged that while we have built up deep domain expertise on how to maximize event
+success and established a good rapport with a number of IP owners, we can enhance our profitability in the long run if we could build
+on our core business as an event planner and move up the value chain from a pure service provider to also play the role of an event organizer
+that directly invests into the experience events, especially if we are able to secure IP licenses at a low price before the licensed
+characters and their associated cartoons and/or motion pictures become a big hit. Obtaining multi-territorial IP licenses from IP owners
+will also help us enter new overseas markets in which we have never ventured with the assistance of third-party event planners and local
+facilitators that have the local market knowledge, while we continue to carry out our core business as an event planner in markets which
+we have prior event management experience (such as Hong Kong and Malaysia) to save the costs and time in engaging and liaising with third-party
+event planners. As a first step, we have started to sign direct investment deals with event organizers. In the long run, we plan
+to leverage our industry experience and our connections with IP owners built up over the years to start obtaining multi-territorial IP
+licenses from IP owners directly, which we believe will help us increase our market share in the events industry in Hong Kong as well
+as our profitability in the long run. This will require a lot of upfront capital investment, and we plan to use the proceeds from the
+public offering to finance the acquisition of these multi-territorial IP licenses. As of the date of this prospectus, we have commenced
+preliminary discussion with some IP owners on potential multi-territorial IP licenses.
+
+ 
+
+To
+ensure the success and maximize the profit of the experience events we organize, it is important for us to understand event attendees 
+interests and preferences and their consumption behavior. The third-party ticketing platforms that we currently engage only provide us
+with limited data on the leads generated on their platforms. However, in order to effectively market our experience events, we need a
+single system of record to collect and analyze event attendee engagement data points and act on this data to help us foster stronger
+relationships with potential event attendees, better understand their needs and tailor our services to suit. We believe this will increase
+our brand s credibility and build trust. As such, we plan to build our own ticketing platform to promote and sell tickets of the
+experience events we organize. Apart from potentially increasing our market share in the events industry by expanding the breadth and
+depth of our event management services, we can also utilize this platform as an effective marketing platform for us to (i) facilitate
+lead capture; (ii) push pre-event content (such as broadcast-quality video content that can engage attendees before an event occurs)
+to target audience; (iii) conduct pre-event surveys; and (iv) provide event attendees with access to on-demand video content to keep
+them engaged after an event concludes. All these will help us secure the full engagement data on event attendees. Analyzing the big data
+collected from this platform on attendee engagement and survey responses will help us acquire the appropriate IP licenses based on content
+effectiveness, plan our future experience events and reduce our risks in investing in these experience events, as we move up the value
+chain to also act as the event organizer of these experience events.
+
+ 
+
+ -91-
+
+ 
+
+ 
+
+ 
+
+Pricing
+Model
+
+ 
+
+The
+pricing of our event management services or the pricing of event tickets, interactive opportunities, merchandise as well as food and
+beverage depends primarily on, among other things, our estimated event execution time costs, complexity of the event, the third-party
+costs we expect to incur which will not be reimbursed by our customers, such as local coordinator fees and fees of independent external
+labor sourcing agents, and other factors such as market demand, trends in the labor market, pricing of previous similar jobs, customers 
+acceptable price ranges, our competitors prices and our expected margins.
+
+ 
+
+As
+for the design and/or sale of merchandise, the design fee we charge is priced on a basis similar to our event management services and
+we also consider the extent to which the design will be utilized by our customers.
+
+ 
+
+In
+cases where our customers also require our assistance in managing the processes of product development, sourcing, production management,
+quality control and logistics services, we typically sell the finished merchandise to our customers. When determining the sale price,
+we generally take into consideration, among other things, the quality and quantity of raw materials used, technical complexity of the
+design, the production costs as quoted to us by the third-party manufacturers, the number of stock keeping units and our expected margins.
+
+ 
+
+Customers
+
+ 
+
+Prior
+to our engagement in direct investment deals in April 2024, our
+customers were generally event organizers and other enterprises and individuals based in Hong Kong that engage in event organization
+and trading activities. We served a total of ten and ten customers during the fiscal years ended March 31, 2023 and 2024, respectively.
+Consistent with market practice, our customers engage us on a project-by-project basis that are non-recurring in nature. We have not
+entered into any long-term contract with any of our customers. During the fiscal years ended March 31, 2023 and 2024, our three largest
+customers accounted for approximately 89.6% and 88.8% of our net revenue, respectively, and our largest customer accounted for
+approximately 66.4% and 66.5% of our net revenue, respectively. For fiscal year ended March 31, 2023, as our business was materially
+affected by the COVID-19 pandemic, we did not have any experience events organized that year and for the fiscal year that ended March
+31, 2024, all four experience events organized were instructed by the same customer.
+
+ 
+
+For
+the six months ended September 30, 2024, we mainly engaged in direct investment deals and our customers were generally sponsors of the
+experience events we organized and individual event attendees in the countries for which the experience events were held. Our three largest
+customers (excluding individual event attendees) accounted for approximately 58.5% of our net revenue, and our largest customer accounted
+for approximately 30.1% of our net revenue.
+
+ 
+
+Out
+of the major customers that have accounted for 10% or more of our revenue, only one of them is a repeating major customer in the
+fiscal years ended March 31, 2023 and 2024 and the six months ended September 30, 2024, and this customer accounted for approximately
+2.8%, 66.5% and 21.7% of our net revenue in the fiscal years ended March 31, 2023 and 2024 and
+the six months ended September 30, 2024, respectively. We have maintained business relationships with our major customers for over
+three years on average. We generally grant our major customers five to 30 days of credit periods, and they generally pay us by check.
+
+ 
+
+ -92-
+
+ 
+
+ 
+
+ 
+
+Sales
+and Marketing
+
+ 
+
+We
+strive to maintain good business relationships with our customers. Our founder, director and chief executive officer, Ms. Seto, is responsible
+for fostering, building and maintaining relationships with our existing and potential customers, and keeping abreast of market developments
+and potential business opportunities. We have also been relying on customer referrals and/or word-of-mouth to promote our event management,
+design and merchandising services. Our engagement by customers for our event management, design and merchandising services generally
+starts with a potential customer approaching us for a quotation of our services or Ms. Seto approaching a potential customer to express
+our interests after she has learned about a potential project through her business connections.
+
+ 
+
+Suppliers
+
+ 
+
+Our
+suppliers include service providers, such as local facilitators, human resources companies, venue operators, PR firms and merchandise
+manufacturers. During the fiscal years ended March 31, 2023 and 2024 and the six months ended September 30, 2024, we did not enter
+into any long-term contracts with our suppliers. We have maintained business relationships with our major suppliers for over two years
+on average. Our major suppliers generally grant us 30 days of credit periods and we normally pay our suppliers by way of check.
+
+ 
+
+During
+the fiscal years ended March 31, 2023 and 2024 and the six months ended September 30, 2024, cost of goods sold accounted for approximately
+28.3%, 44.6% and 11.4% of our total cost of revenue, respectively. Cost of goods sold attributed to our five largest
+suppliers accounted for approximately 85.0%, 78.9% and 68.3% of our total cost of goods sold, respectively, and out of
+the major vendors that have accounted for 10% or more of our total cost of revenue, none of them is a repeating major vendor in
+the fiscal years ended March 31, 2023 and 2024 and the six months ended September 30, 2024. Cost of goods sold attributed
+to our largest supplier accounted for approximately 43.3%, 20.7% and 32.6% of our total cost of goods sold,
+respectively. We believe that our major suppliers can be easily replaced in the market should the relationship be discontinued.
+
+ 
+
+ -93-
+
+ 
+
+ 
+
+ 
+
+Employees
+
+ 
+
+As
+of September 30, 2024, we employed a total of 15 persons, 14 of which were working full-time and one working part-time.
+The number of our employees classified by function was as follows:
+
+ 
+
+ 
+ 
+ Total 
+
+ 
+ Management 
+ 1 
+
+ 
+ Project 
+ 5 
+
+ 
+ Design
+ and merchandising 
+ 6 
+
+ 
+ Finance
+ and administration 
+ 3 
+
+ 
+ 
+ 15 
+
+ 
+
+ 
+
+All
+our employees are local, and they are not covered by collective bargaining agreements. We offer competitive salaries, discretionary performance-based
+bonuses, medical insurance and a defined contribution to an MPF scheme to our employees. We have complied with the statutory minimum
+wage requirement provided under the Minimum Wage Ordinance for the fiscal years ended March 31, 2023 and 2024, and the six months
+ended September 30, 2024. We consider our labor practices and employee relations to be good.
+
+ 
+
+Due
+to the nature of our business, we work with human resources companies to hire temporary workers to assist us in the organization, planning,
+promotion and management of events as and when required.
+
+ 
+
+Intellectual
+Property
+
+ 
+
+We
+provide our event management, design and merchandising services under the brand name "Trendic". We do not have any registered
+trademark but we have registered the domain name https://www.trendicint.com.
+
+ 
+
+The
+vast majority of events we organize, plan, promote and manage originates from IP licenses. We understand the importance of the protection
+of IP rights. We endeavor, and procure all third-parties engaged by the event organizer and/or us in relation to these events, to protect
+the IP owners rights in the licensed property by (i) including appropriate copyright and trademark notices whenever any licensed
+property is being incorporated, displayed, exploited or otherwise used; (ii) complying with all guidelines and other requests set out
+by the IP owners on the use of the licensed property; (iii) refraining to use the licensed property other than as specifically permitted
+by the IP owners; (iv) agreeing that all IP rights created (if any) during the exploitation of the licensed property belong to the IP
+owners; (v) refraining to register any IP rights that are confusingly similar to the licensed property in our respective name, in any
+part of the world; and (vi) informing the IP owner immediately in cases of any potential infringement of the IP owners IP rights
+and seek the IP owner s approval on the usage of the licensed property in case of any uncertainty.
+
+ 
+
+To
+our best knowledge, we were not involved in any proceedings with regard to, and we have not received notice of any claims or infringement
+of, any IP rights that may be threatened or pending, in which we may be involved either as a claimant or respondent.
+
+ 
+
+ -94-
+
+ 
+
+ 
+
+ 
+
+Real
+Property
+
+ 
+
+We
+do not own any real property and we currently operate in the following three leased premises in Hong Kong:
+
+ 
+
+ 
+ Location
+ 
+ Usage
+ 
+ Lease
+ period
+ 
+ Monthly
+ rent
+ 
+ Approximate
+ gross floor area
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Room
+ 1705, 17th Floor
+
+ PeakCastle,
+ 476 Castle Peak Road
+
+ Lai
+ Chi Kok, Kowloon
+
+ Hong
+ Kong
+
+ 
+ Head
+ office 
+ 
+ July
+ 19, 2024 to July 18, 2026
+ 
+ HK$41,100
+ 
+ 1,790
+ square feet
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Shop
+ 1, 4th Floor
+
+ iSQUARE,
+ 63 Nathan Road
+
+ Tsim
+ Sha Tsui, Kowloon
+
+ Hong
+ Kong
+
+ 
+ Event
+ venue
+ 
+ June
+ 5, 2024 to September 16, 2025
+ 
+ HK$1
+ base rent plus turnover rent
+ 
+ 9,593
+ square feet
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Shop
+ 4, 3rd Floor
+
+ iSQUARE,
+ 63 Nathan Road
+
+ Tsim
+ Sha Tsui, Kowloon
+
+ Hong
+ Kong
+
+ 
+ Caf 
+ for event venue
+ 
+ June
+ 11, 2024 to September 16, 2025
+ 
+ HK$10,000
+ base rent plus turnover rent
+ 
+ 1,917
+ square feet
+
+ 
+ 
+
+Insurance
+
+ 
+
+We
+maintain content and stock, business interruption, money and employees compensation as well as public liability policies to protect
+our business, facilities and employees in accordance with customary industry practice and/or in compliance with applicable laws and regulations
+in Hong Kong. In cases where we are engaged as an event planner, event organizers are generally responsible for taking out insurance
+policies covering the events (including ourselves). However, we also take out event specific insurance as and when required under the
+terms of the relevant event management contracts, such as public liability insurance covering our employees in the event venue. However,
+for direct investment deals, we are responsible for taking out all insurance policies covering the events. We do not carry any "key
+person" or product liability insurance. We will continue to review and assess our risk portfolio and make necessary and appropriate
+adjustments to our insurance practices to align with our needs and with industry practice in Hong Kong and any other markets which we
+may operate in the future.
+
+ 
+
+Competition
+
+ 
+
+The
+events industry in Hong Kong encompasses a range of public and private events, from trade shows, conferences, concerts, exhibitions,
+charity galas, brand promotion events to internal corporate events. This industry is highly fragmented and intensely competitive. It
+is characterized by constant change and innovation as customers are demanding event management companies to create deeper and more meaningful
+event experiences that leave lasting impressions.
+
+ 
+
+We
+specialize in organizing, planning, promoting and managing experience events. It is a niche sector of the events industry as it requires
+the players to have an in-depth knowledge of the operation of IP licenses and experience in working with IP owners. Our biggest competition
+comes from local event management companies that are experienced in organizing big scale public events that involve IP licenses. Furthermore,
+we may face potential competition from global event management companies that seek to enter the Hong Kong market, whether independently
+or through the formation of strategic alliances with, or acquisition of, event management companies that operate in the Hong Kong market.
+
+ 
+
+We
+believe the principal competitive factors in our market include breadth and depth of the scope of services, pricing, user experience,
+financial viability, industry expertise and reputation, proven customer references, track record as well as relationship with other industry
+players (such as IP owners, venue operators and overseas event management companies). We believe that we generally compete favorably
+with our competitors because the breadth and depth of our services allow us to manage the entire event lifecycle across every type of
+event.
+
+ 
+
+Litigation
+and Other Legal Proceedings
+
+ 
+
+At
+the date of this prospectus, we are not party to any claim, litigation or arbitration of material importance and there was no claim,
+litigation or arbitration of material importance known to our directors to be pending or threatened against us which could have a material
+adverse effect on our business, financial condition or results of operations.
+
+ 
+
+ -95-
+
+ 
+
+ 
+
+ 
+
+REGULATORY
+ENVIRONMENT AND THE LAWS AND
+
+REGULATIONS
+OF HONG KONG 
+
+ 
+
+The
+following sets forth a summary of the material laws and regulations relating to our Group s business operations in Hong Kong.
+
+ 
+
+This
+section summarizes the major aspects of the principal laws, rules and regulations that are directly relevant and material to our operations
+in Hong Kong.
+
+ 
+
+Hong
+Kong Regulatory Overview
+
+ 
+
+We
+only have office and operations in Hong Kong. Based on the advice from our Hong Kong Legal Advisers and the representations of our Company,
+Trendic had obtained all material requisite licenses, approvals and permits from the relevant governmental authorities in Hong Kong for
+our business operations in Hong Kong during the Track Record Period and up to the date of this prospectus.
+
+ 
+
+This
+section sets forth a summary of the general Hong Kong laws and regulations applicable to our Group s business in Hong Kong.
+
+ 
+
+Business
+Registration Ordinance (Chapter 310 of the Laws of Hong Kong)
+
+ 
+
+The
+Business Registration Ordinance requires every person carrying on any business to make an application to the Commissioner of Inland Revenue
+in the prescribed manner for the registration of that business within one month after the commencement of business. The Commissioner
+of Inland Revenue must register each business for which a business registration application is made and as soon as practicable after
+the prescribed business registration fee and levy are paid and issue a business registration certificate or branch registration certificate
+for the relevant business or the relevant branch, as the case may be. Any person who fails to apply for business registration shall be
+guilty of an offence and shall be liable to a fine of HK$5,000 and to imprisonment for 1 year. We held a valid business registration
+certificate under the Business Registration Ordinance throughout the Track Record Period and as at the date of this prospectus.
+
+ 
+
+Occupiers
+Liability Ordinance (Chapter 314 of the Laws of Hong Kong)
+
+ 
+
+The
+Occupiers Liability Ordinance regulates the obligations of a person occupying or having control of premises on injury resulting to persons
+or damage caused to goods or other property on the land.
+
+ 
+
+The
+Occupiers Liability Ordinance imposes a common duty of care on an occupier of premises to take such care as in all the circumstances
+of the case is reasonable to see that the visitor will be reasonably safe in using the premises for the purposes for which he is invited
+or permitted by the occupier to be there.
+
+ 
+
+Trade
+Description Ordinance (Chapter 362 of the Laws of Hong Kong)
+
+ 
+
+After
+an amendment in 2012, which came into operation in 2013, some new provisions in the Trade Description Ordinance ("TDO")
+are relevant to commercial practice including advertising and marketing.
+
+ 
+
+ -96-
+
+ 
+
+ 
+
+ 
+
+Under
+section 2 of the TDO, trade description can now be applied to a service. It means in relation to a service, an indication, direct or
+indirect, and by whatever means given, with respect to the service or any part of the service including an indication of any of the following
+matters:
+
+ 
+
+ 
+ (a)
+ nature,
+ scope, quantity (including the number of occasions on which, and the length of time for which, the service is supplied or to be supplied),
+ standard, quality, value or grade;
+
+ 
+ 
+ 
+
+ 
+ (b)
+ fitness
+ for purpose, strength, performance, effectiveness, benefits or risks;
+
+ 
+ 
+ 
+
+ 
+ (c)
+ method
+ and procedure by which, manner in which, and location at which, the service is supplied or to be supplied;
+
+ 
+ 
+ 
+
+ 
+ (d)
+ availability;
+
+ 
+ 
+ 
+
+ 
+ (e)
+ testing
+ by any person and the results of the testing;
+
+ 
+ 
+ 
+
+ 
+ (f)
+ approval
+ by any person or conformity with a type approved by any person; (g) a person by whom it has been acquired, or who has agreed to acquire
+ it; (h) the person by whom the service is supplied or to be supplied;
+
+ 
+ 
+ 
+
+ 
+ (i)
+ after-sale
+ service assistance concerning the service;
+
+ 
+ 
+ 
+
+ 
+ (j)
+ price,
+ how price is calculated or the existence of any price advantage or discount.
+
+ 
+
+Under
+section 7A of the TDO, a trader who applies a false trade description to a service supplied or offered to be supplied to a consumer;
+or supplies or offers to supply to a consumer a service to which a false trade description is applied commits an offence. Under section
+13E of the TDO, if the commercial practice (including advertising and marketing) contains misleading omission as to material information
+the trader commits a criminal offence.
+
+ 
+
+Under
+section 18 of the TDO, any person who commits an offence under inter alia, section 7A or section 13E shall be liable on conviction on
+indictment to a maximum fine of HK$500,000 (US$64,000) and imprisonment for 5 years; and on summary conviction to a maximum fine of HK$100,000
+(US$12,000) and imprisonment for 2 years. Further, under section 18A of the TDO, on conviction of an offence under inter alia sections
+7A and 13E, the court has the additional power to order the payment of compensation.
+
+ 
+
+According
+to section 20 of the TDO, if the offence is committed by a limited company and the offence has been committed with the consent or connivance
+or is attributable to the neglect of a person including a director, officer or manager they also commit the offence.
+
+ 
+
+Misrepresentation
+Ordinance (Chapter 284 of the laws of Hong Kong)
+
+ 
+
+Under
+the Misrepresentation Ordinance, where a person entered into a contract after a misrepresentation has been made to him, and (a) the misrepresentation
+has become a term of the contract; or (b) the contract has been performed, or both, then, if otherwise he would be entitled to rescind
+the contract without alleging fraud, he shall be so entitled, subject to the provisions of this Ordinance, notwithstanding the matters
+mentioned in (a) and (b) above.
+
+ 
+
+Under
+section 3 of the Misrepresentation Ordinance:
+
+ 
+
+ 
+ (1)
+ Where
+ a person entered into a contract after a misrepresentation has been made to him by another party thereto and as a result thereof he
+ has suffered loss, then, if the person making the misrepresentation would be liable to damages in respect thereof had the misrepresentation
+ been made fraudulently, that person shall be so liable notwithstanding that the misrepresentation was not made fraudulently, unless
+ he proves that he had reasonable grounds to believe and did believe up to the time the contract was made that the facts represented
+ were true.
+
+ 
+
+ -97-
+
+ 
+
+ 
+
+ 
+
+ 
+ (2)
+ Where
+ a person entered into a contract after a misrepresentation has been made to him otherwise than fraudulently, and he would be entitled,
+ by reason of the misrepresentation, to rescind the contract, then, if it is claimed, in any proceedings arising out of the contract,
+ that the contract ought to be or has been rescinded the court or arbitrator may declare the contract subsisting and award damages in
+ lieu of rescission, if of opinion that it would be equitable to do so, having regard to the nature of the misrepresentation and the
+ loss that would be caused by it if the contract were upheld, as well as to the loss that rescission would cause to the other party.
+
+ 
+ 
+ 
+
+ 
+ (3)
+ Damages
+ may be awarded against a person under subsection (2) whether or not he is liable to damages under subsection (1), but where he is so
+ liable any award under subsection (2) shall be taken into account in assessing his liability under subsection (1).
+
+ 
+
+Limitation
+Ordinance (Chapter 347 of the Laws of Hong Kong)
+
+ 
+
+Under
+the Limitation Ordinance, the time limit for an applicant to commence common law claims for personal injuries is three years from the
+date on which the cause of action accrued.
+
+ 
+
+Employment
+Ordinance (Chapter 57 of the Laws of Hong Kong)
+
+ 
+
+The
+Employment Ordinance, or the EO, is an ordinance enacted for, amongst other things, the protection of the wages of employees and the
+regulation of the general conditions of employment and employment agencies. Under the EO, an employee is generally entitled to, amongst
+other things, notice of termination of his or her employment contract; payment in lieu of notice; maternity protection in the case of
+a pregnant employee; not less than one rest day in every period of seven days; severance payments or long service payments; sickness
+allowance; statutory holidays or alternative holidays; and paid annual leave of up to 14 days depending on the period of employment.
+
+ 
+
+Under
+the EO, the wage period in respect of which wages are payable under a contract of employment shall be deems to be 1 month, until the
+contrary is proved. Wages shall become due on the expiry of the last day of the wage period and shall be paid as soon as is practicable
+but in any case not later than 7 days thereafter. In the case where wages are not paid within 7 days after which they become due and
+payable, interest will be imposed at a rate fixed by the Chief Justice in the Hong Kong Special Administrative Region Gazette under Section
+50 of the District Court Ordinance (Chapter 336).
+
+ 
+
+Employees 
+Compensation Ordinance (Chapter 282 of the Laws of Hong Kong)
+
+ 
+
+The
+Employees Compensation Ordinance, or the ECO, is an ordinance enacted for the purpose of providing for the payment of compensation
+to employees injured in the course of employment. The ECO establishes a no-fault and non-contributory employee compensation system for
+work injuries and lays down the rights and obligations of employers and employees in respect of injuries or death caused by accidents
+arising out of and in the course of employment, or by prescribed occupational diseases.
+
+ 
+
+ -98-
+
+ 
+
+ 
+
+ 
+
+Under
+the ECO, if an employee sustains an injury or dies as a result of an accident arising out of and in the course of his employment, his
+employer is in general liable to pay compensation even if the employee might have committed acts of faults or negligence when the accident
+occurred. Similarly, an employee who suffers incapacity or dies arising from an occupational disease is entitled to receive the same
+compensation as that payable to employees injured in occupational accidents.
+
+ 
+
+As
+stipulated by the ECO, no employer shall employ any employee in any employment unless there is in force in relation to such employee
+a policy of insurance issued by an insurer for an amount not less than the applicable amount specified in the Fourth Schedule of the
+ECO in respect of the liability of the employer. According to the Fourth Schedule of the ECO, the insured amount shall be not less than
+HK$100,000,000 per event if a company has no more than 200 employees. Any employer who contravenes this requirement commits a criminal
+offence and is liable on conviction to a fine and imprisonment. An employer who has taken out an insurance policy under the ECO is required
+to display a prescribed notice of insurance in a conspicuous place on each of its premises where any employee is employed.
+
+ 
+
+Mandatory
+Provident Fund Schemes Ordinance (Chapter 485 of the Laws of Hong Kong)
+
+ 
+
+The
+Mandatory Provident Fund Schemes Ordinance, or the MPFSO, is an ordinance enacted for the purposes of providing for the establishment
+of non-governmental mandatory provident fund schemes, or the MPF Schemes. The MPFSO requires every employer of an employee of 18 years
+of age or above but under 65 years of age to take all practical steps to ensure the employee becomes a member of a registered MPF Scheme
+within the first 60 days of employment. Subject to the minimum and maximum relevant income levels, it is mandatory for both employers
+and their employees to contribute 5% of the employee s relevant income to the MPF Scheme.
+
+ 
+
+An
+employer who, without reasonable excuse, fails to comply with the requirement imposed on employers in relation to arrange for its employees
+to become scheme members, commits an offence and is liable on conviction to a fine of HK$350,000 and to imprisonment for 3 years, and
+to a daily penalty of HK$500 for each day on which the offence is continued.
+
+ 
+
+An
+employer who, without reasonable excuse, fails to comply with the requirements in relation to making mandatory contributions to the MPF
+Scheme commits a criminal offence and is liable on conviction to a maximum fine of HK$50,000 and imprisonment for six months on the first
+conviction and maximum fine of HK$100,000 and imprisonment for one year on each subsequent conviction.
+
+ 
+
+Occupational
+Safety and Health Ordinance (Chapter 509 of the Laws of Hong Kong)
+
+ 
+
+The
+Occupational Safety and Health Ordinance provides for the safety and health protection to employees in workplaces, both industrial and
+non-industrial.
+
+ 
+
+Employers
+must as far as reasonably practicable ensure the safety and health in their workplaces by:
+
+ 
+
+ 
+ 
+ providing
+ and maintaining plant and systems of work that are safe and without risks to health;
+
+ 
+ 
+ 
+
+ 
+ 
+ making
+ arrangements for ensuring safety and absence of risks to health in connection with the use, handling, storage or transport of plant
+ or substances;
+
+ 
+
+ -99-
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ as
+ regards any workplace under the employer s control: maintenance of the workplace in a condition that is safe and without risks
+ to health; and provision and maintenance of means of access to and egress from the workplace that are safe and without any such risks;
+
+ 
+ 
+ 
+
+ 
+ 
+ providing
+ all necessary information, instructions, training and supervision for ensuring safety and health; and
+
+ 
+ 
+ 
+
+ 
+ 
+ providing
+ and maintaining a working environment for the employer s employees that is safe and without risks to health.
+
+ 
+
+Failure
+to comply with any of the above provisions constitutes an offence and the employer is liable on conviction to a fine of HK$200,000 (US$26,000).
+An employer who fails to do so intentionally, knowingly or recklessly commits an offence and is liable on conviction to a fine of HK$200,000
+(US$26,000) and to imprisonment for six months.
+
+ 
+
+The
+Commissioner for Labor may also issue an improvement notice against non-compliance of the Occupational Safety and Health Ordinance or
+suspension notice against activity or condition of workplace which may create imminent risk of death or serious bodily injury. Failure
+to comply with such notice without reasonable excuse constitutes an offence punishable by a fine of HK$200,000 (US$26,000) and HK$500,000
+(US$64,000) respectively and imprisonment of up to 12 months.
+
+ 
+
+Minimum
+Wage Ordinance (Chapter 608 of the Laws of Hong Kong)
+
+ 
+
+The
+Minimum Wage Ordinance provides for a prescribed minimum hourly wage rate (set at HK$40 per hour with effect from May 1, 2023) during
+the wage period for every employee engaged under a contract of employment under the Employment Ordinance (except those specified under
+section 7 of the Minimum Wage Ordinance). Any provision of a contract of employment that purports to extinguish or reduce any right,
+benefit or protection conferred on the employee by the Minimum Wage Ordinance is void.
+
+ 
+
+Inland
+Revenue Ordinance (Chapter 112 of the Laws of Hong Kong)
+
+ 
+
+Under
+the Inland Revenue Ordinance, or the IRO, where an employer commences to employ in Hong Kong an individual who is or is likely to be
+chargeable to tax, or any married person, the employer shall give a written notice to the Commissioner of Inland Revenue not later than
+three months after the date of commencement of such employment. Where an employer ceases or is about to cease to employ in Hong Kong
+an individual who is or is likely to be chargeable to tax, or any married person, the employer shall give a written notice to the Commissioner
+of Inland Revenue not later than one month before such individual ceases to be employed in Hong Kong.
+
+ 
+
+Tax
+on dividends
+
+ 
+
+Under
+the current practice of the Inland Revenue Department of Hong Kong, no tax is payable in Hong Kong in respect of dividends paid by the
+Company.
+
+ 
+
+Capital
+gains and profit tax
+
+ 
+
+The
+IRO provides, among other things, that profits tax shall be charged on every person carrying on a trade, profession or business in Hong
+Kong in respect of his or her assessable profits arising in or derived from Hong Kong at the standard rate, which stood at 8.25% on assessable
+profits up to HK$2,000,000 and 16.5% on any part of assessable profits over HK$2,000,000 for corporate taxpayers as of the date of this
+prospectus. The IRO also contains detailed provisions relating to, among other things, permissible deductions for outgoings and expenses,
+set-offs for losses and allowances for depreciations of capital assets.
+
+ 
+
+ -100-
+
+ 
+
+ 
+
+ 
+
+No
+tax is imposed in Hong Kong in respect of capital gains from the sale of shares. However, trading gains from the sale of shares by persons
+carrying on a trade, profession or business in Hong Kong, where such gains are derived from or arise in Hong Kong, will be subject to
+Hong Kong profits tax. Certain categories of taxpayers (for example, financial institutions, insurance companies and securities dealers)
+are likely to be regarded as deriving trading gains rather than capital gains unless these taxpayers can prove that the investment securities
+are held for long-term investment purposes.
+
+ 
+
+Our
+directors confirm that Trendic had complied with the applicable provisions under the Inland Revenue Ordinance throughout the Track Record
+Period and up to the latest practicable date.
+
+ 
+
+Stamp
+Duty Ordinance (Chapter 117 of the Laws of Hong Kong)
+
+ 
+
+Under
+the Stamp Duty Ordinance, the Hong Kong stamp duty currently charged at the ad valorem rate of 0.1% (commencing from November 17, 2023)
+on the higher of the consideration for or the market value of the shares, will be payable by the purchaser on every purchase and by the
+seller on every sale of Hong Kong shares (in other words, a total of 0.26% is currently payable on a typical sale and purchase transaction
+of Hong Kong shares). In addition, a fixed duty of HK$5 is currently payable on any instrument of transfer of Hong Kong shares. Where
+one of the parties is a resident outside Hong Kong and does not pay the ad valorem duty due by it, the duty not paid will be assessed
+on the instrument of transfer (if any) and will be payable by the transferee. If no stamp duty is paid on or before the due date, a penalty
+of up to ten times the duty payable may be imposed.
+
+ 
+
+Estate
+duty
+
+ 
+
+Hong
+Kong estate duty was abolished effective from February 11, 2006. No Hong Kong estate duty is payable by shareholders in relation to the
+shares owned by them upon death.
+
+ 
+
+Competition
+Ordinance (Chapter 619 of the Laws of Hong Kong)
+
+ 
+
+The
+Competition Ordinance that commenced full operation on December 14, 2015 (i) prohibits conduct that prevents, restricts or distorts competition
+in Hong Kong; (ii) prohibits mergers that substantially lessen competition in Hong Kong; and (iii) provides for incidental and connected
+matter.
+
+ 
+
+The
+"First Conduct Rule" prohibits anti-competitive agreements, practices and decisions. It provides that an undertaking must
+not (i) make or give effect to an agreement; (ii) engage in a concerted practice; or (iii) as a member of an association of undertakings,
+make or give effect to a decision of the association, if the object or effect of the agreement, concerted practice or decision is to
+prevent, restrict or distort competition in Hong Kong. Serious anti-competitive conduct includes (i) fixing, maintaining, increasing
+or controlling the price for the supply of goods or services; (ii) allocating sales, territories, customers or markets for the production
+or supply of goods or services; (iii) fixing, maintaining, controlling, preventing, limiting or eliminating the production or supply
+of goods or services; and (iv) bid-rigging.
+
+ 
+
+ -101-
+
+ 
+
+ 
+
+ 
+
+The
+"Second Conduct Rule" prohibits the abuse of market power. It provides that an undertaking that has a substantial degree
+of market power in a market must not abuse such power by engaging in conduct that has as its object or effect the prevention, restriction
+or distortion of competition in Hong Kong. This conduct may in particular, constitute an abuse of such market power if it involves predatory
+behavior towards competitors or limiting production, markets or technical development to the prejudice of consumers. Matters that may
+be taken into consideration when determining whether an undertaking has a substantial degree of market power in a market include (i)
+the market share of the undertaking; (ii) the undertaking s power to make pricing and other decisions; (iii) any barriers to entry
+to competitors into the relevant market; and (iv) any other relevant matters specified in the guidelines issued in accordance with the
+Competition Ordinance.
+
+ 
+
+The
+First Conduct Rule and the Second Conduct Rule apply to all sectors of the Hong Kong economy, including marketing and advertising services
+providers. Therefore, our business is subject to Competition Ordinance generally.
+
+ 
+
+In
+the event of contravention of a competition rule, the Competition Tribunal may (i) on application by the Competition Commission, impose
+pecuniary penalty of any amount it considers appropriate subject to a maximum of 10% of the turnover of the undertaking concerned for
+each year in which the contravention occurred for each single contravention (if the contravention occurred in more than three years,
+10% of the turnover of the undertaking for the three years that saw the highest, second highest and third highest turnover); (ii) on
+application by the Competition Commission, make an order disqualifying a person from being a director of a company or from otherwise
+being concerned in the affairs of a company; (iii) make orders it considers appropriate, including but not limited to prohibiting an
+entity from making or giving effect to an agreement, requiring modification or termination of an agreement, requiring payment of damages
+to a person who has suffered loss or damage as a result of the contravention.
+
+ 
+
+Copyright
+Ordinance (Chapter 528 of the Laws of Hong Kong)
+
+ 
+
+The
+Copyright Ordinance currently in force in Hong Kong came into effect on June 27, 1997. The Copyright Ordinance as reviewed and revised
+from time to time provides comprehensive protection for recognized categories of literary, dramatic, musical and artistic works, as well
+as for sound recordings, films, television broadcasts and cable programs.
+
+ 
+
+In
+the course of preparing interior design proposals, we may create original artistic works (such as drawings) or literary works (such as
+text) or videos that qualify for copyright protection without registration. Infringement of copyright is civilly actionable.
+
+ 
+
+Anti-Money
+Laundering and Counter-Terrorist Financing Ordinance (Chapter 615 of the Laws of Hong Kong)
+
+ 
+
+The
+Anti-Money Laundering and Counter-Terrorist Financing Ordinance, or the AMLO, imposes requirements relating to client due diligence and
+record-keeping and provides regulatory authorities with the powers to supervise compliance with the requirements under the AMLO. In addition,
+the regulatory authorities are empowered to (i) ensure that proper safeguards exist to prevent contravention of specified provisions
+in the AMLO; and (ii) mitigate money laundering and terrorist financing risks.
+
+ 
+
+ -102-
+
+ 
+
+ 
+
+ 
+
+Drug
+Trafficking (Recovery of Proceeds) Ordinance (Chapter 405 of the Laws of Hong Kong)
+
+ 
+
+The
+Drug Trafficking (Recovery of Proceeds) Ordinance, or the DTROP, contains provisions for the investigation of assets suspected to be
+derived from drug trafficking activities, the freezing of assets on arrest and the confiscation of the proceeds from drug trafficking
+activities. It is an offence under the DTROP if a person deals with any property knowing, or having reasonable grounds to believe, it
+to be the proceeds from drug trafficking. The DTROP requires a person to report to an authorized officer if he/she knows or suspects
+that any property (directly or indirectly) is the proceeds from drug trafficking or is intended to be used or was used in connection
+with drug trafficking, and failure to make such disclosure constitutes an offence under the DTROP.
+
+ 
+
+Organized
+and Serious Crimes Ordinance (Chapter 455 of the Laws of Hong Kong)
+
+ 
+
+The
+Organized and Serious Crimes Ordinance, or the OSCO, empowers officers of the Hong Kong Police Force and the Hong Kong Customs and Excise
+Department to investigate organized crime and triad activities, and it gives the Hong Kong courts jurisdiction to confiscate the proceeds
+from organized and serious crimes, to issue restraint orders and charging orders in relation to the property of defendants of specified
+offences. The OSCO extends the money laundering offence to cover the proceeds of all indictable offences in addition to drug trafficking.
+
+ 
+
+Prevention
+of Bribery Ordinance (Chapter 201 of the Laws of Hong Kong)
+
+ 
+
+The
+Prevention of Bribery Ordinance prohibits all forms of bribery and corruption. Any director or employee is prohibited from soliciting,
+accepting or offering any bribe in conducting a company s business or affairs, whether in Hong Kong or elsewhere. In particular,
+in conducting all business or affairs of a company, the director or employee must comply with the Prevention of Bribery Ordinance and
+must not:
+
+ 
+
+(a)solicit
+ or accept any advantage from others as a reward for or inducement to doing any act, abstaining
+ from doing any act or showing favor in relation to the company s business or affairs,
+ or offer any advantage to an agent of another as a reward for or inducement to doing any
+ act, abstaining from doing any act of showing favor in relation to his principal s
+ business or affairs;
+
+ 
+
+(b)offer
+ any advantage to any public servant, which, for the purpose of the Prevention of Bribery
+ Ordinance, includes any employee of a public body, such as departments of the Hong Kong government,
+ as a reward for or inducement to his performing any act in his official capacity or his showing
+ any favor or providing any assistance with the Hong Kong government or public body;
+
+ 
+
+(c)offer
+ any advantage to any staff of any department under the Hong Kong government or public body
+ while he is having business dealing with the latter; or
+
+ 
+
+(d)offer
+ any advantage to any other person as an inducement to or a reward for the withdrawal of a
+ tender or the refraining from making of a tender for any contract with a public body or bidding
+ at any auction conducted by any public body.
+
+ 
+
+Depending
+on the offence committed, the maximum penalties for the above offences under the Prevention of Bribery Ordinance range from fines of
+HK$100,000 to HK$500,000 and imprisonment for 1 year to 10 years.
+
+ 
+
+United
+Nations (Anti-Terrorism Measures) Ordinance (Chapter 575 of the Laws of Hong Kong)
+
+ 
+
+The
+United Nations (Anti-Terrorism Measures) Ordinance, or the UNATMO, provides that it is a criminal offence to: (i) provide or collect
+funds (by any means, directly or indirectly) with the intention or knowledge that the funds will be used to commit, in whole or in part,
+one or more terrorist acts; or (ii) make any funds or financial (or related) services available, directly or indirectly, to or for the
+benefit of a person knowing that, or being reckless as to whether, such person is a terrorist or terrorist associate. The UNATMO also
+requires a person to report his knowledge or suspicion of terrorist property to an authorized officer, and failure to make such disclosure
+constitutes an offence under the UNATMO.
+
+ 
+
+Personal
+Data (Privacy) Ordinance (Chapter 486 of the laws of Hong Kong)
+
+ 
+
+The
+Personal Data (Privacy) Ordinance protects the privacy interests of living individuals in relation to personal data. It covers any automated
+and non-automated data relating directly or indirectly to a living individual and applies to both public and private bodies as data users
+that control the collection, holding, processing or use of personal data.
+
+ 
+
+There
+are six principles in respect of the purpose and manner of collection of data, the accuracy and duration of retention of data, the use
+of personal data, the security of personal data, the information to be generally available and the access to personal data. In general,
+the personal data shall be lawfully and fairly collected and steps should be taken to ensure that the data subject is explicitly or implicitly
+informed on or before collecting the data. Personal data should also be accurate, up-to-date and kept no longer than necessary while
+unless with the consent from the data subjects, personal data should be used for the purposes for which they were collected or a directly
+related purpose.
+
+ 
+
+The
+Office of the Privacy Commissioner for Personal Data is the governing body to promote, administer and oversee the enforcement of the
+Personal Data (Privacy) Ordinance. It has the power to carry out inspections of any personal data systems, to receive complaints from
+individuals and to investigate data users in respect of the complaints filed.
+
+ 
+
+ -103-
+
+ 
+
+ 
+
+ 
+
+MANAGEMENT
+
+ 
+
+The
+following table sets forth the names, ages and titles of our directors, executive officers and key employees:
+
+ 
+
+ 
+ Name
+ 
+ Age
+ 
+ 
+ Title
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ms.
+ Seto Wai Yue
+ 
+ 42
+ 
+ Chief
+ Executive Officer and Director
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ms.
+ Tse Sze Man
+ 
+ 43
+ 
+ Director
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Mr.
+ Leung Tak Shun
+ 
+ 39
+ 
+ Chief
+ Financial Officer
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ms.
+ Cheung Tan
+ 
+ 35
+ 
+ Independent
+ Director Nominee and Chairman of Audit Committee
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ms.
+ Lui Yi Sin, Edith
+ 
+ 43
+ 
+ Independent
+ Director Nominee and Chairman of Compensation Committee
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ms.
+ Lee Wing Yin 
+ 
+ 39
+ 
+ Independent
+ Director Nominee and Chairman of Nomination Committee
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Mr.
+ Luk Kai Chung
+ 
+ 40
+ 
+ General
+ Manager
+
+ 
+ 
+
+Each
+independent director nominee will be appointed effective immediately upon the SEC s declaration of effectiveness of our registration
+statement on Form F-1.
+
+ 
+
+Directors
+and Executive Officers 
+
+ 
+
+Ms.
+Seto Wai Yue
+
+ 
+
+Ms.
+Seto, aged 42, founded our Group in 2016. She is our founder, chief executive officer and director, and she is responsible for the overall
+business development such as overseeing all aspects of our Group s operations, strategic planning and formulation of corporate
+strategies.
+
+ 
+
+Ms.
+Seto has a wealth of experience and expertise in running and managing her own businesses. In May 2012, Ms. Seto founded her first venture
+named The Stairs, which was a one-stop luxury comprehensive store. As the founder, she was responsible for the development and execution
+of the company s business strategies as well as the company s financial performance. In the same year, she sold her equity
+interest in The Stairs, and acquired a business named 2%. She revamped the brand by building a new group of young, energetic and enterprising
+team, and turned the company s business from loss to profit.
+
+ 
+
+Prior
+to founding our Group, she had a joint venture with a well-known cartoon character brand between January 2012 to December 2016, where
+she was primarily responsible for the growth and development of the brand in the Hong Kong market such as marketing merchandise and clothing
+of the well-known cartoon character, and organizing themed restaurant events and shopping mall exhibitions. In October 2018, she co-founded
+a Taiwanese bubble tea business in Hong Kong. As the co-founder, she was responsible for business development such as collaborating with
+established brands, and brand expansions in Hong Kong, Taiwan, Malaysia, Canada.
+
+ 
+
+ -104-
+
+ 
+
+ 
+
+ 
+
+Ms.
+Seto received her bachelor s of arts degree in clothing and textile retail management from The Hong Kong Polytechnic University
+in 2004.
+
+ 
+
+Ms.
+Tse Sze Man
+
+ 
+
+Ms.
+Tse is our director. Ms. Tse is responsible for the overall operation and management of our Group s business and formulation of
+our business plans and growth strategies.
+
+ 
+
+Ms.
+Tse has been the Head of the Design & Merchandising Team at Trendic International Limited since August 2022. She is responsible for
+preparing the budget plans for merchandising, liaising with local and overseas project managers for design and merchandising issues and
+monitoring merchandise sales reports and product feedback to increase sales profits. Further, Ms. Tse monitors her team to ensure compliance
+with merchandise development and bulk production schedules. From November 2016 and August 2022, Ms. Tse was the Personal Assistant to
+the Managing Director at Shu Talk Branding Company Limited. She was in charge of handling personal and business matters and providing
+all-rounded secretarial support to the firm s Directors. Ms. Tse also prepared project proposals for business purposes and assisted
+with monitoring the merchandising status of the firm. Between September 2014 and August 2016, Ms. Tse was the Assistant Product Development
+Manager at Dizen Limited (2% Group). Ms. Tse primarily coordinated with the in-house designer to facilitate product development and technical
+support, prepared for tradeshows and fashion shows and communicated with the merchandising, retail and marketing departments to evaluate
+feedback in light of market demand.
+
+ 
+
+Ms.
+Tse has over 15 years of experience in the design and merchandising industry. She obtained a BA (Hons) in Fashion and Textiles from the
+Hong Kong Polytechnic University in 2005.
+
+ 
+
+Independent
+Directors
+
+ 
+
+Ms.
+Cheung Tan
+
+ 
+
+Ms.
+Cheung Tan, or Ms. Cheung, will begin serving as an independent director immediately upon the SEC s declaration of effectiveness
+of our registration statement on Form F-1, of which this prospectus forms a part. Ms. Cheung will serve as chairman of the audit committee
+and as a member of the compensation committee and nomination committee.
+
+ 
+
+Ms.
+Cheung joined Roma Risk Advisory Limited in January 2020. Currently, she is the associate director where she leads a team of risk and
+ESG advisory professionals to provide comprehensive services for a diverse portfolio of listed and IPO clients, as well as non-governmental
+organizations. She is also responsible for directing the implementation of internal control enhancement projects including the development
+of policies, procedures and monitoring mechanism; and in guiding clients in establishing ESG frameworks, policies and reporting mechanisms
+to align with evolving regulations and best practices. Prior to joining Roma Risk Advisory Limited, Ms. Cheung was with PricewaterhouseCoopers
+Limited from August 2016 to January 2020 and her last position was senior consultant.
+
+ 
+
+ -105-
+
+ 
+
+ 
+
+ 
+
+She
+was responsible for performing tax analysis for private equity funds and hedge funds and the corresponding tax treatments for US tax
+purposes; and complying with company risk management procedures upon new client acceptances and perform anti-money laundering procedures
+for non-assurance clients.
+
+ 
+
+Ms.
+Cheung received both her bachelor s degree and master s degree in accounting from St. Francis College, New York in December
+2014. Ms. Cheung is a certified public accountant of the Hong Kong Institute of Certified Public Accounts and a European Federation of
+Financial Analysts Societies (EFFAS) certified ESG analyst.
+
+ 
+
+Ms.
+Lui Yi Sin, Edith
+
+ 
+
+Ms.
+Lui Yi Sin, Edith, or Ms. Lui, will begin serving as an independent director immediately upon the SEC s declaration of effectiveness
+of our registration statement on Form F-1, of which this prospectus forms a part. Ms. Lui will serve as chairman of the compensation
+committee and as a member of the audit committee and nomination committee.
+
+ 
+
+Ms.
+Lui has been the account manager at Ho Wai Printing and Publishing Co. Ltd. since December 2013. She is responsible for coordinating
+with customers and suppliers for order processing; and creating and maintaining a positive and long-term relationship with all customers.
+Between October 2012 to July 2013, Ms. Lui was the front desk administrator at ISF Academy. Ms. Lui was responsible for handling administrative
+work and other ad-hoc support duties such as organizing exhibitions, school events and other activities. Between August 2008 to December
+2008, she was the data entry clerk at PolyVision, where she was primarily responsible for handling calls and processing day-to-day data
+entry activities, assisting in date consolidation and report generation and maintaining a functional documentation and filing system.
+
+ 
+
+Ms.
+Lui received her bachelor s degree in business economics from University of California at Santa Barbara in December 2006.
+
+ 
+
+Ms.
+Lee Wing Yin 
+
+ 
+
+Ms.
+Lee Wing Yin, or Ms. Lee, will begin serving as an independent director immediately upon the SEC s declaration of effectiveness
+of our registration statement on Form F-1, of which this prospectus forms a part. Ms. Lee will serve as chairman of the nomination committee
+and as a member of the audit committee and compensation committee.
+
+ 
+
+Ms.
+Lee co-founded Golden Lion Security (HK) Ltd., a venture specializing in Li Heung Tea brand creation and operation in January 2024. As
+the co-founder, she is primarily responsible for overseeing product research and development and implementing innovative marketing strategies
+and attending targeted outreach and networking events to grow the company s customer base and increase company s revenue.
+Ms. Lee is also currently the marketing director at Asian Express Ltd and has been serving this position since September 2023. She leads
+a team of marketing professionals to develop and execute comprehensive marketing campaigns and has achieved significant growth in brand
+awareness and market share through targeted public relations initiatives.
+
+ 
+
+ -106-
+
+ 
+
+ 
+
+ 
+
+Ms.
+Lee commenced her undergraduate studies in communications and media at Macquarie University before completing a Bachelor of Media Studies
+with Journalism and Communications at Middlesex University in August 2008.
+
+ 
+
+Key
+Employees
+
+ 
+
+General
+Manager
+
+ 
+
+Mr.
+Luk Kai Chung
+
+ 
+
+Mr.
+Luk Kai Chung, Mr. Luk, is our General Manager and he is responsible for overseeing the day-to-day operations of the company. He serves
+as the bridge between upper-level management and front-line employees, ensuring that the organization functions smoothly and efficiently.
+
+ 
+
+Between
+August 2013 and August 2016, Mr. Luk was the Business Development Manager at Dizen Limited (2% Group). Mr. Luk s roles included
+analyzing the context of the macro-environment and assisting with market strategies with the Director, managing 7 store locations and
+25 frontline staff members to achieve sales targets and maintain stock levels, and working closely with the Visual Merchandising and
+Marketing Departments. Mr. Luk further assumed administrative roles by supervising activities related to office administration such as
+fixed asset management and supplies procurement. Between July 2009 and June 2013, Mr. Luk was the Assistant Manager at Conson Business
+Limited. Mr. Luk s roles included providing executive assistance to the General Manager in charge of daily operations, managing
+operations including ensuring staff service standards and handling complaints and developing policies and administering internal systems.
+Mr. Luk was also in charge of facilitating and maintaining business relations with clients and employees.
+
+ 
+
+Mr.
+Luk obtained a Foundation Certificate in Life Coaching with a Distinction from the University of Hong Kong School of Professional and
+Continuing Education in 2012, and a Certificate in Sales and Account Management from the Hong Kong Management Association in 2010. Mr.
+Luk previously obtained a Bachelor of Arts in Marketing from the University of Portsmouth in 2008 and an Associate Degree in Business
+from the Hong Kong Polytechnic University Hong Kong Community College in 2006.
+
+ 
+
+Chief
+Financial Officer 
+
+ 
+
+Mr.
+Leung Tak Shun
+
+ 
+
+Mr.
+Leung Tak Shun, or Mr. Leung, will begin serving as our chief financial officer immediately upon the SEC s declaration of effectiveness of our registration statement on Form F-1,
+of which this prospectus forms a part. Mr. Leung is responsible for the following
+matters relating to our Group:
+
+ 
+
+ Overseeing
+ the financial functions, tax and corporate secretarial matters of our Group;
+
+ Financial
+ reporting of our Company; and
+
+ Preparation
+ of budget and financial forecasts.
+
+ 
+
+ -107-
+
+ 
+
+ 
+
+ 
+
+Mr.
+Leung has over 15 years of experience in auditing and accounting consulting services. He has a thorough understanding of the Hong Kong
+Listing Rules, taxation regulations and accounting standards. Mr. Leung has been a Director at CMB CPA Limited since January 2023. He
+manages a team of four auditors and is responsible for leading audit engagements for clients in various industries including trading,
+healthcare, and manufacturing, conducting risk assessments to mitigate financial risks and providing training of latest auditing and
+accounting standards to the audit team. Between December 2015 and December 2022, Mr. Leung was a Senior Manager of the Audit Department
+at RSM Hong Kong. Mr. Leung took charge of numerous IPO projects in Hong Kong and managed the audit and preparation of year-end budgets
+of listed companies, liaising regularly with sponsors, lawyers and valuers along the listing and compliance processes. From December
+2014 to December 2015, Mr. Leung was an Assistant Manager of the Audit Department at Grant Thornton Hong Kong Limited. Mr. Leung was
+responsible for leading the audit of an education company s IPO listing in Hong Kong, and also assisted with the audit of listed
+companies.
+
+ 
+
+Mr.
+Leung obtained a BA (Hons) in Accountancy with Second Class Honors (Division I) in 2007 and is a member of the Hong Kong Institute of
+Certified Public Accountants.
+
+ 
+
+Family
+Relationships
+
+ 
+
+There
+is no family relationship among any of our directors, executive officers, independent directors and key employee.
+
+ 
+
+Board
+Diversity
+
+ 
+
+The
+composition of our board of directors currently includes five individuals who self-reports as diverse under the Nasdaq Listing Rule 5605(f)
+regarding board diversity as applies to foreign private issuers. Under Nasdaq Listing Rule 5605(f), directors who self-identify as (i)
+female, (ii) an underrepresented minority based on the national, racial, ethnic, indigenous, cultural, religious or linguistic identity
+or (iii) LGBTQ+ are defined as being diverse. The following chart summarizes certain self-identified personal characteristics of our
+directors, in accordance with Nasdaq Listing Rule 5605(f). Each term used in the table has the meaning given to it in the rule and related
+instructions:
+
+ 
+
+Board
+Diversity Matrix (as of the date of this prospectus)
+
+ 
+
+ 
+ 
+ Female 
+ Male 
+ Non-Binary 
+ Did
+ Not 
+Disclose Gender 
+
+ 
+ Part
+ I: Gender Identity 
+ 
+ 
+ 
+ 
+
+ 
+ Directors 
+ 5 
+ - 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Part
+ II: Demographic Background 
+ 
+ 
+ 
+ 
+
+ 
+ African
+ American or Black 
+ - 
+ - 
+ - 
+ - 
+
+ 
+ Alaskan
+ Native or Native American 
+ - 
+ - 
+ - 
+ - 
+
+ 
+ Asian 
+ 5 
+ - 
+ - 
+ - 
+
+ 
+ Hispanic
+ or Latino 
+ - 
+ - 
+ - 
+ - 
+
+ 
+ Native
+ Hawaiian or Pacific Islander 
+ - 
+ - 
+ - 
+ - 
+
+ 
+ White 
+ - 
+ - 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ LGBTQ+ 
+ - 
+ - 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Did
+ Not Disclose Demographic Background 
+ - 
+ - 
+ - 
+ - 
+
+ 
+
+ 
+
+ -108-
+
+ 
+
+ 
+
+ 
+
+Committees
+of the Board of Directors
+
+ 
+
+Our
+board of directors will establish an audit committee, a compensation committee and a nomination committee effective upon the Registration
+Statement of which this prospectus forms a part becoming effective, each of which will operate pursuant to a charter adopted by our board
+of directors that will be effective upon the effectiveness of the Registration Statement of which this prospectus is a part. The board
+of directors may also establish other committees from time to time to assist our Company and the board of directors. Upon the effectiveness
+of the Registration Statement of which this prospectus is a part, the composition and functioning of all of our committees will comply
+with all applicable requirements of the Sarbanes-Oxley Act of 2002, the Nasdaq and SEC rules and regulations. Upon our listing on the
+Nasdaq, each committee s charter will be available on our website at http://www.trendicint.com. The reference to our website
+address does not constitute incorporation by reference of the information contained at or available through our website, and you should
+not consider it to be part of this prospectus.
+
+ 
+
+Audit
+committee
+
+ 
+
+Ms.
+Cheung, Ms. Lui and Ms. Lee will serve on the audit committee, which will be chaired by Ms. Cheung. Our board of directors has determined
+that each member of the audit committee is "independent" for audit committee purposes as that term is defined by the rules
+of the SEC and the Nasdaq. Our board of directors has designated Ms. Cheung as an "audit committee financial expert," as
+defined under the applicable rules of the SEC. The audit committee s responsibilities include:
+
+ 
+
+ 
+ 
+ appointing,
+ approving the compensation of, and assessing the independence of our independent registered public accounting firm;
+
+ 
+ 
+ 
+
+ 
+ 
+ pre-approving
+ auditing and permissible non-audit services, and the terms of such services, to be provided by our independent registered public
+ accounting firm;
+
+ 
+ 
+ 
+
+ 
+ 
+ reviewing
+ the overall audit plan with our independent registered public accounting firm and members of management responsible for preparing
+ our financial statements;
+
+ 
+ 
+ 
+
+ 
+ 
+ reviewing
+ and discussing with management and our independent registered public accounting firm our annual and quarterly financial statements
+ and related disclosures as well as critical accounting policies and practices used by us;
+
+ 
+ 
+ 
+
+ 
+ 
+ coordinating
+ the oversight and reviewing the adequacy of our internal controls over financial reporting;
+
+ 
+ 
+ 
+
+ 
+ 
+ establishing
+ policies and procedures for the receipt and retention of accounting-related complaints and concerns; recommending, based upon the
+ audit committee s review and discussions with management and our independent registered public accounting firm, whether our
+ audited financial statements shall be included in our Annual Report on Form 20-F;
+
+ 
+ 
+
+ -109-
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ monitoring
+ the integrity of our financial statements and our compliance with legal and regulatory requirements as they relate to our financial
+ statements and accounting matters;
+
+ 
+ 
+ 
+
+ 
+ 
+ reviewing
+ all related person transactions for potential conflict of interest situations and approving all such transactions; and
+
+ 
+ 
+ 
+
+ 
+ 
+ reviewing
+ earnings releases.
+
+ 
+ 
+
+Compensation
+committee
+
+ 
+
+Ms.
+Cheung, Ms. Lui and Ms. Lee will serve on the compensation committee, which will be chaired by Ms. Lui. Our board of directors has determined
+that each member of the compensation committee is "independent" as defined in the applicable the Nasdaq rules. The compensation
+committee s responsibilities include:
+
+ 
+
+ 
+ 
+ evaluating
+ the performance of our chief executive officer in light of our company s corporate goals and objectives and based on such evaluation:
+ (i) recommending to the board of directors the cash compensation of our chief executive officer, and (ii) reviewing and approving
+ grants and awards to our chief executive officer under equity-based plans;
+
+ 
+ 
+ 
+
+ 
+ 
+ reviewing
+ and recommending to the board of directors the cash compensation of our other executive officers;
+
+ 
+ 
+ 
+
+ 
+ 
+ reviewing
+ and establishing our overall management compensation, philosophy and policy;
+
+ 
+ 
+ 
+
+ 
+ 
+ overseeing
+ and administering our compensation and similar plans;
+
+ 
+ 
+ 
+
+ 
+ 
+ reviewing
+ and approving the retention or termination of any consulting firm or outside advisor to assist in the evaluation of compensation
+ matters and evaluating and assessing potential and current compensation advisors in accordance with the independence standards identified
+ in the applicable the Nasdaq rules;
+
+ 
+ 
+ 
+
+ 
+ 
+ retaining
+ and approving the compensation of any compensation advisors;
+
+ 
+ 
+ 
+
+ 
+ 
+ reviewing
+ and approving our policies and procedures for the grant of equity-based awards;
+
+ 
+ 
+ 
+
+ 
+ 
+ reviewing
+ and recommending to the board of directors the compensation of our directors; and
+
+ 
+ 
+ 
+
+ 
+ 
+ preparing
+ the compensation committee report required by SEC rules, if and when required.
+
+ 
+ 
+
+Nomination
+committee
+
+ 
+
+Ms.
+Cheung, Ms. Lui and Ms. Lee which will be chaired by Ms. Lee. Our board of directors has determined that each member of the nomination
+committee is "independent" as defined in the applicable the Nasdaq rules. The nomination committee s responsibilities
+include:
+
+ 
+
+ 
+ 
+ developing
+ and recommending to the board of directors criteria for board and committee membership;
+
+ 
+ 
+ 
+
+ 
+ 
+ establishing
+ procedures for identifying and evaluating director candidates, including nominees recommended by stockholders; and
+
+ 
+ 
+
+ -110-
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ reviewing
+ the composition of the board of directors to maintain that it is composed of members containing the appropriate skills and expertise
+ to advise us.
+
+ 
+ 
+
+While
+we do not have a formal policy regarding board diversity, our nomination committee and board of directors will consider a broad range
+of factors relating to the qualifications and background of nominees, which may include diversity (including, but not limited to race,
+gender or national origin). Our nomination committee s and board of directors priority in selecting board members is identification
+of persons who will further the interests of our shareholders through their established record of professional accomplishment, the ability
+to contribute positively to the collaborative culture among board members, knowledge of our business, understanding of the competitive
+landscape and professional and personal experience and expertise relevant to our growth strategy.
+
+ 
+
+Controlled
+Company
+
+ 
+
+Upon
+the completion of this offering, Ms. Seto, our controlling Shareholder will beneficially own 70.81% of our total issued and outstanding
+Class A Ordinary Shares and 100% of our outstanding Class B Ordinary Shares, representing in aggregate 79.13% of
+the total voting power. As a result, we will be a "controlled company" as defined under Nasdaq Listing Rule 5615(c), because
+our controlling Shareholder will hold more than 50% of the voting power for the election of directors. As a result, you may not have
+the same protection afforded to shareholders of companies that are subject to these corporate governance requirements.
+
+ 
+
+Public
+Companies that qualify as a "Controlled Company" with securities listed on the Nasdaq Stock Market, must comply with the
+exchange s continued listing standards to maintain their listings. Nasdaq has adopted qualitative listing standards. Companies
+that do not comply with these corporate governance requirements may lose their listing status. Under the Nasdaq rules, a "controlled
+company" is a company with more than 50% of its voting power held by a single person, entity or group. Under Nasdaq rules, a controlled
+company is exempt from certain corporate governance requirements, including:
+
+ 
+
+ 
+ 
+ an
+ exemption from the rule that a majority of our board of directors must be independent directors;
+
+ 
+ 
+ an
+ exemption from the rule that the compensation of our chief executive officer must be determined or recommended solely by independent
+ directors; and
+
+ 
+ 
+ an
+ exemption from the rule that our director nominees must be selected or recommended solely by independent directors.
+
+ 
+ 
+
+Controlled
+companies must still comply with the exchange s other corporate governance standards. These include having an audit committee and
+the special meetings of independent or non-management directors.
+
+ 
+
+We
+currently do not intend to rely on any of the exemptions although we may elect to rely on one or more of the exemptions in the future.
+
+ 
+
+ -111-
+
+ 
+
+ 
+
+ 
+
+Foreign
+Private Issuer Status
+
+ 
+
+The
+Nasdaq Stock Market Rules include certain accommodations in the corporate governance requirements that allow foreign private issuers,
+such as us, to follow "home country" corporate governance practices in lieu of the otherwise applicable Nasdaq corporate
+governance standards. The application of such exceptions requires that we disclose each Nasdaq corporate governance standard that we
+do not follow and describe the Cayman Islands corporate governance practices we do follow in lieu of the relevant Nasdaq corporate governance
+standard. We currently follow Cayman Islands corporate governance practices in lieu of the corporate governance requirements of the Nasdaq
+in respect of the following:
+
+ 
+
+ 
+ 
+ provide
+ an annual certification by our chief executive officer that he or she is not aware of any non-compliance with any corporate governance
+ rules of the Nasdaq;
+
+ 
+ 
+ 
+
+ 
+ 
+ have
+ regularly scheduled executive sessions with only independent directors; and
+
+ 
+ 
+
+ 
+ 
+ the
+ Shareholder Approval Requirements under Section 5635 of the Nasdaq Stock Market Rules. There will be no requirement for the Company
+ to obtain Shareholder approval prior to an issuance of securities in connection with (a) the acquisition of stock or assets of another
+ company; (b) equity-based compensation of officers, directors, employees or consultants; (c) a change of control; and (d) transactions
+ other than public offerings.
+
+ 
+ 
+
+Corporate
+governance
+
+ 
+
+Prior
+to the effectiveness of the registration statement of which this prospectus is a part, we intend to adopt a formal policy regarding board
+diversity and our nominating and corporate governance and Board will consider a broad range of factors relating to the qualifications
+and background of nominees, which may include diversity (not limited to race, gender or national origin). Our nominating and corporate
+governance committee, along with the Board, prioritize the selection of board members who can advance shareholder interests by showcasing
+a proven track record of professional achievements. Additionally, they should possess the capability to foster a collaborative environment
+among board members, have a deep understanding of our business and the competitive landscape, and bring forth professional and personal
+experiences that align with our growth strategy.
+
+ 
+
+Code
+of Conduct and Code of Ethics
+
+ 
+
+Prior
+to the effectiveness of the Registration Statement of which this prospectus is a part, we intend to adopt a written code of business
+conduct and ethics that applies to our directors, officers and employees, including our chief executive officer, chief financial officer,
+principal accounting officer or controller or persons performing similar functions. Following the effectiveness of the Registration Statement
+of which this prospectus is a part, a current copy of this code will be posted on the Corporate Governance section of our website, which
+is located at http://www.trendicint.com. The information on our website is deemed not to be incorporated in this prospectus or to be
+a part of this prospectus. We intend to disclose any amendments to the code of ethics, and any waivers of the code of ethics or the code
+of conduct for our directors, executive officers and senior finance executives, on our website to the extent required by applicable U.S.
+federal securities laws and Nasdaq corporate governance rules.
+
+ 
+
+Compensation
+of Directors and Key Employees 
+
+ 
+
+The
+following table summarizes all compensation received by our directors and our key employees during the years ended March 31, 2023 and
+2024, and for the six months ended September 30, 2023 and 2024.
+
+ 
+
+Bonuses
+are not payable pursuant to a bonus plan, but rather are made on a discretionary basis in consideration of contributions and profitability
+of the Company for the year under which such bonus was paid.
+
+ 
+
+ -112-
+
+ 
+
+ 
+
+ 
+
+Summary
+Compensation Table
+
+ 
+
+ 
+ Position 
+ Aggregate
+ Salary (HK$) 
+ Aggregate
+ Compensation
+ Paid
+ Bonus (HK$)
+ 
+ Aggregate
+ Other
+ Compensation (HK$) 
+ Aggregate
+ amount of Salary, Compensation Paid Bonus and other Compensation
+ (HK$)
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ All
+ directors (For the year ended 2024) 
+ 430,500 
+ 36,430 
+ 0 
+ 466,930 
+
+ 
+ (For
+ the year ended 2023) 
+ 271,847 
+ 8,380 
+ 0 
+ 280,227 
+
+ 
+ (For
+ the six months ended September 30, 2024) 
+ 831,000 
+ 0 
+ 275,373 
+ 1,106,373 
+
+ 
+ (For
+ the six months ended September 30, 2023) 
+ 210,000 
+ 0 
+ 0 
+ 210,000 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ All
+ key employees (For the year ended 2024) 
+ 252,000 
+ 4,000 
+ 0 
+ 256,000 
+
+ 
+ (For
+ the year ended 2023) 
+ 240,000 
+ 12,007 
+ 0 
+ 252,007 
+
+ 
+ (For
+ the six months ended September 30, 2024) 
+ 244,000 
+ 0 
+ 0 
+ 244,000 
+
+ 
+ (For
+ the six months ended September 30, 2023) 
+ 120,000 
+ 0 
+ 0 
+ 120,000 
+
+ 
+
+ 
+
+*Independent
+directors to be appointed upon the effectiveness of the Registration Statement.
+
+ 
+
+Insurance
+entered into by Trendic for the benefit of Ms. Seto
+
+ 
+
+On
+August 30, 2024, Trendic entered into a savings insurance plan, or Insurance Plan, with Manulife (International) Limited, with the beneficiary
+of the Insurance Plan being the estate of Ms. Seto. Trendic made an initial payment of US$35,212.87 upon entering into the Insurance
+Plan and, under the terms of the Insurance Plan, Trendic will make four additional payments of US$40,000 annually. The notional / guaranteed
+maturity amount of the Insurance Plan is US$200,000.
+
+ 
+
+Independent
+Directors Agreements
+
+ 
+
+Each
+of our independent directors will enter into a director s agreement with the Company effective upon the effectiveness of the Registration
+Statement. The terms and conditions of the directors agreements are similar in all material aspects. Each director s agreement
+is for an initial term of one year and will continue until the director s successor is duly elected and qualified. Each director
+will be up for re-election each year at the annual shareholders meeting and, upon re-election, the terms and provisions of his
+or her director s agreement will remain in full force and effect. Any director s agreement may be terminated for any or no
+reason by the director or at a meeting called expressly for that purpose by a vote of the shareholders holding more than 50% of the Company s
+issued and outstanding Class A Ordinary Shares entitled to vote.
+
+ 
+
+Under
+the directors agreements, the initial monthly director fees that will be payable to each of our independent directors is HK$10,000.
+Such director fees are payable in cash on a monthly basis.
+
+ 
+
+In
+addition, our independent directors will be entitled to participate in such share option scheme as may be adopted by the Company, as
+amended from time to time. The number of options granted, and the terms of those options will be determined from time to time by a vote
+of the board of directors; provided that each director shall abstain from voting on any such resolution or resolutions relating to the
+grant of options to that director.
+
+ 
+
+Other
+than as disclosed above, none of our directors has entered into a service agreement with our Company or any of our subsidiaries that
+provides for benefits upon termination of employment.
+
+ 
+
+ -113-
+
+ 
+
+ 
+
+ 
+
+Employment
+Agreements
+
+ 
+
+We
+have entered into employment agreements with each of our directors, which were effective upon the effectiveness of the registration statement
+of which this prospectus forms a part. Each employment agreement will continue indefinitely subject to termination by either party upon
+one month s written notice.
+
+ 
+
+Employment
+Agreement between Ms. Seto and Trendic
+
+ 
+
+Effective
+as of the date of the closing of this offering, Trendic entered into an Employment Agreement with Ms. Seto. The agreement provides for
+an annual base salary of HK$1,200,000. Ms. Seto s employment will continue indefinitely, subject to termination by either party
+to the agreement upon one month s prior written notice or the equivalent salary in lieu of such notice. The agreement also provides
+that Ms. Seto shall not, during the term of the agreement and for 12 months after cessation of employment, carry on business in competition
+with the Group.
+
+ 
+
+Employment
+Agreement between Mr. Leung Tak Shun and Trendic
+
+ 
+
+Effective
+as of the date of the closing of this offering, Trendic entered into an Employment Agreement with Mr. Leung Tak Shun. The agreement provides
+for an annual base salary of HK$600,000. Mr. Leung Tak Shun s employment will continue indefinitely, subject to termination by
+either party to the agreement upon one month s prior written notice or the equivalent salary in lieu of such notice. The agreement
+also provides that Mr. Leung Tak Shun shall not, during the term of the agreement and for 12 months after cessation of employment, carry
+on business in competition with the Group.
+
+ 
+
+Employment
+Agreement between Ms. Tse and Trendic 
+
+ 
+
+Effective
+as of August 8, 2022, Trendic entered into an Employment Agreement with Ms. Tse in the capacity of project manager. The agreement provides
+for a monthly base salary of HK$35,000. Ms. Tse s employment will continue indefinitely, subject to termination by either party
+to the agreement upon one month s prior written notice or the equivalent salary in lieu of such notice. The agreement also provides
+that Ms. shall not disclose any non-public information arising from any aspect of her employment for the benefit of others during and
+subsequent to her employment with Trendic. The agreement also prohibits Ms. Tse from engaging in direct or indirect employment by another
+party whilst being employed by Trendic.
+
+ 
+
+Employment
+Agreement between Mr. Luk Kai Chung and Trendic 
+
+ 
+
+Effective
+as of June 1, 2021, Trendic entered into an Employment Agreement with Mr. Luk Kai Chung in the capacity of project manager. The agreement
+provides for a monthly base salary of HK$20,000. Mr. Luk Kai Chung s employment will continue indefinitely, subject to termination
+by either party to the agreement upon one month s prior written notice or the equivalent salary in lieu of such notice. The agreement
+also provides that Mr. Luk Kai Chung shall not disclose any non-public information arising from any aspect of his employment for the
+benefit of others during and subsequent to his employment with Trendic. The agreement also prohibits Mr. Luk Kai Chung from engaging
+in direct or indirect employment by another party whilst being employed by Trendic.
+
+ 
+
+ -114-
+
+ 
+
+ 
+
+ 
+
+2025
+Equity Incentive Plan
+
+ 
+
+Prior
+to the completion of this offering, our shareholders and Board will adopt the 2025 Dreamland Limited Equity Incentive Plan, or the 2025
+Equity Incentive Plan, to motivate attract and retain the best available personnel, provide additional incentives to staff and directors
+and promote the success of our business. Under the 2025 Equity Incentive Plan, the maximum aggregate number of Class A Ordinary Shares
+which may be issued pursuant to all awards under such plan will be , which constitutes 20%
+of the total issued and outstanding Class A Ordinary Shares of our Company on a fully-diluted basis as of the date of adoption. Pursuant
+to Rule 416(a) under the Securities Act, this Registration Statement also covers an indeterminate number of additional shares which may
+be offered and issued to prevent dilution from share splits, share dividends or similar transactions as provided in the 2025 Equity Incentive
+Plan. Any Class A Ordinary Shares covered by an award granted under the 2025 Equity Incentive Plan (or portion of an award) that terminates,
+expires, lapses or repurchased for any reason will be deemed not to have been issued for purposes of determining the maximum aggregate
+number of Class A Ordinary Shares that may be issued under the 2025 Equity Incentive Plan. As of the date of this prospectus, we have
+not granted any awards under the 2025 Equity Incentive Plan.
+
+ 
+
+The
+following paragraphs summarize the principal terms of the 2025 Equity Incentive Plan.
+
+ 
+
+Types
+of awards.
+
+ 
+
+The
+2025 Equity Incentive Plan permits the awards of options, restricted shares, restricted share units or any other type of awards
+approved by our Board or the compensation committee.
+
+ 
+
+Plan
+administration.
+
+ 
+
+Our
+Board or the compensation committee administers the 2025 Equity Incentive Plan. Our Board or the compensation committee determines,
+among other things, the participants to receive awards, the type and number of awards to be granted to each participant, and the terms
+and conditions of each award grant.
+
+ 
+
+Award
+agreement.
+
+ 
+
+Awards
+granted under the 2025 Equity Incentive Plan are evidenced by an award agreement that sets forth terms, conditions and limitations
+for each award, which may include the term of the award, the provisions applicable in the event of the grantee s employment or
+service terminates, and our authority to unilaterally or bilaterally amend, modify, suspend, cancel or rescind the award.
+
+ 
+
+Eligibility.
+
+ 
+
+We
+may grant awards to our staff and directors.
+
+ 
+
+ -115-
+
+ 
+
+ 
+
+ 
+
+Vesting
+schedule.
+
+ 
+
+In
+general, the plan administrator determines the vesting schedule, which is specified in the relevant award agreement.
+
+ 
+
+Exercise
+of awards.
+
+ 
+
+The
+exercise price per share subject to an option is determined by the plan administrator and set forth in the award agreement, which may
+be a fixed price or a variable price related to the fair market value of the Class A Ordinary Shares. The vested portion of option will
+expire if not exercised prior to the time as the plan administrator determines at the time of its grant.
+
+ 
+
+Transfer
+restrictions.
+
+ 
+
+Awards
+may not be transferred in any manner by the eligible participant other than in accordance with the limited exceptions, such as transfers
+to our company or a subsidiary of ours, transfers to the immediate family members of the participant by gift, the designation of a beneficiary
+to receive benefits if the participant dies, permitted transfers or exercises on behalf of the participant by the participant s
+duly authorized legal representative if the participant has suffered a disability, or, subject to the prior approval of the plan administrator
+or our executive officer or director authorized by the plan administrator, transfers to one or more natural persons who are the participant s
+family members or entities owned and controlled by the participant and/or the participant s family members, including but not limited
+to trusts or other entities whose beneficiaries or beneficial owners are the participant and/or the participant s family members,
+or to such other persons or entities as may be expressly approved by the plan administrator, pursuant to such conditions and procedures
+as the plan administrator may establish.
+
+ 
+
+Termination
+and amendment.
+
+ 
+
+Unless
+terminated earlier, the 2025 Equity Incentive Plan has a term of 10 years. Our Board may terminate, amend or modify the plan,
+subject to the limitations of applicable laws. However, no such action may adversely affect in any material way any award previously
+granted without prior written consent of the participant.
+
+ 
+
+Indemnification
+Agreements
+
+ 
+
+We
+have entered into indemnification agreements with each of our directors and executive officers, to be effective upon the Registration
+Statement of which this prospectus forms a part becoming effective. Under these agreements, we agree to indemnify our directors and executive
+officers against certain liabilities and expenses incurred by such persons in connection with claims made by reason of their being a
+director or officer of our Company.
+
+ 
+
+Insofar
+as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers or persons controlling
+us under the foregoing provisions, we have been informed that in the opinion of the SEC, such indemnification is against public policy
+as expressed in the Securities Act and is therefore unenforceable.
+
+ 
+
+ -116-
+
+ 
+
+ 
+
+ 
+
+PRINCIPAL
+AND SELLING SHAREHOLDERS
+
+ 
+
+The
+following table sets forth information with respect to the beneficial ownership, within the meaning of Rule 13d-3 under the Exchange
+Act, of our Class A Ordinary Shares and our Class B Ordinary Shares as of the date of this prospectus, and as adjusted to reflect
+the sale of the Class A Ordinary Shares offered in this offering for:
+
+ 
+
+ each
+ of our directors and executive officers;
+
+ each
+ of our current directors, officers and independent directors as a group; and
+
+ each
+ person known to us to own beneficially more than 5% of our Class A Ordinary Shares.
+
+ 
+
+Beneficial
+ownership includes voting or investment power with respect to the securities. Except as indicated below, and subject to applicable community
+property laws, the persons named in the table have sole voting and investment power with respect to all Class A Ordinary Shares shown
+as beneficially owned by them. For the purpose of voting power, each Class A Ordinary Share entitles the holder to one vote and each
+Class B Ordinary Share entitles the holder to twelve (12) votes on any matter on which action of the shareholders of our Company
+is sought. The Class B Ordinary Shares votes together with the Class A Ordinary Shares. Percentage of beneficial ownership of each listed
+person prior to this offering is based on 28,660,000 Class A Ordinary Shares and 1,000,000 Class B Ordinary Shares outstanding as of
+the date of this prospectus. Percentage of beneficial ownership of each listed person after this offering is based on 30,000,000 Class
+A Ordinary Shares and 1,000,000 Class B Ordinary Shares outstanding immediately after the completion of this offering.
+
+ 
+
+Information
+with respect to beneficial ownership has been furnished by each director, officer, or beneficial owner of 5% or more of our Class A Ordinary Shares. Beneficial ownership is determined in accordance with the rules of the SEC and generally requires that any such person have
+voting or investment power with respect to securities. In computing the number of Class A Ordinary Shares beneficially owned by a person
+listed below and the percentage ownership of such person, Class A Ordinary Shares underlying options, warrants, or convertible securities
+held by each such person that are exercisable or convertible within 60 days of the date of this prospectus are deemed outstanding, but
+are not deemed outstanding for computing the percentage ownership of any other person. As of the date of the prospectus, we have six
+shareholders of record, none of whom are located in the United States.
+
+ 
+
+ -117-
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Class A Ordinary Shares Beneficially Owned Prior to this offering 
+ Class B Ordinary Shares Beneficially Owned Prior to
+ this offering 
+ Class A Ordinary Shares
+ Beneficially Owned After this offering 
+ Percentage
+ of Voting Power After this offering 
+
+ 
+ 
+ Number 
+ Percent
+ (%)(2) 
+ Number 
+ Percentage
+ (%)(2) 
+ Number 
+ Percent
+ (%)(2) 
+ Percent
+ (%)(2) 
+
+ 
+ Directors
+ and Executive Officers(1):
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ms.
+ Seto 
+ 
+ 21,896,240 
+ 76.40 
+ 1,000,000 
+ 100 
+ 21,236,240 
+ 70.81 
+ 79.13
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ms.
+ Tse 
+ 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0 
+ 0
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Mr.
+ Leung Tak Shun (3)
+ 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ms.
+ Cheung Tan
+ 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ms.
+ Lui Yi Sin, Edith (3)
+ 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ms.
+ Lee Wing Yin (3)
+ 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Mr.
+ Luk Kai Chung (3)
+ 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ All
+ directors and executive officers as a group (7 individuals): 
+ 21,896,240 
+ 76.4
+ 
+ 1,000,000
+ 
+ 100
+ 
+ 21,236,240
+ 
+ 70.81
+ 
+ 79.13
+
+ 
+
+ 
+
+ 
+ 
+ Class A Ordinary Shares Beneficially Owned Prior to this offering 
+ Class B Ordinary Shares Beneficially Owned Prior to
+ this offering 
+ Class A Ordinary Shares
+ Beneficially Owned After this offering 
+ 
+ Percentage
+ of Voting Power After this offering 
+
+ 
+ 
+ Number 
+ Percent (%) 
+ Number 
+ Percent (%) 
+ Number 
+ Percent (%) 
+ Percent (%) 
+
+ 
+ 5%
+ Shareholders: 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ms.
+ Seto 
+ 21,896,240
+ 
+ 76.4
+ 
+ 1,000,000 
+ 
+ 100
+ 
+ 21,236,240
+ 
+ 70.81
+ 
+ 79.13
+ 
+
+ 
+
+ 
+
+We
+are not aware of any arrangement that may, at a subsequent date, result in a change of control of our Company.
+
+ 
+
+Selling
+Shareholder
+
+ 
+
+This
+prospectus covers the offering of in aggregate 660,000 Class A Ordinary Shares by the Selling Shareholder. This
+prospectus and any prospectus supplement will only permit the Selling Shareholder to sell the number of Class A Ordinary
+Shares identified in the column "Number of Class A Ordinary Shares to be Sold." The Class A Ordinary Shares
+owned by the Selling Shareholder are "restricted" securities under applicable United States federal and state
+securities laws and are being registered pursuant to this prospectus to enable the Selling Shareholder the opportunity to
+sell those Class A Ordinary Shares.
+
+ 
+
+The
+following table sets forth the name of the Selling Shareholder, the number and percentage of Class A Ordinary Shares beneficially
+owned by the Selling Shareholder, the number of Class A Ordinary Shares sold in this offering and the number and percentage of
+Class A Ordinary Shares the Selling Shareholder will own after the offering. The information appearing in the table below is based
+on information provided by or on behalf of the named Selling Shareholder. We will not receive any proceeds from the sale of the
+Class A Ordinary Shares by the Selling Shareholder.
+
+ 
+
+ 
+ Name
+ of Selling Shareholder 
+ Class A Ordinary Shares Beneficially Owned Prior to offering 
+ Percentage
+ Ownership Prior to offering(2) 
+ Number
+ of Class A Ordinary Shares Sold 
+ Number
+ of Class A Ordinary Shares Owned After offering 
+ Voting
+
+ Percentage Ownership After offering(2)
+ 
+
+ 
+ Ms.
+ Seto 
+ 21,896,240 
+ 76.40% 
+ 660,000 
+ 21,236,240 
+ 79.13%
+
+ 
+
+ 
+
+Notes:
+
+ 
+
+(1)
+The business address of our directors and executive officers is c/o No. 5, 17th Floor, PeakCastle, No. 476 Castle Peak Road,
+Cheung Sha Wan, Kowloon, Hong Kong.
+
+ 
+
+(2)
+Based on 28,660,000 Class A Ordinary Shares issued and outstanding immediately prior to the offering and 30,000,000 Class A Ordinary
+Shares to be issued and outstanding immediately after the offering. This takes into account 10,000,000 Class B Ordinary Shares held
+by Ms. Seto which carry twelve (12) votes on any matter on which action of the shareholders of the Company is sought.
+
+ 
+
+(3)
+Each independent director nominee and the chief financial officer will be appointed effective immediately upon the SEC s declaration of effectiveness
+of our registration statement on Form F-1.
+
+ 
+
+ -118-
+
+ 
+
+ 
+
+ 
+
+RELATED
+PARTY TRANSACTIONS
+
+ 
+
+Related
+Party Transactions
+
+ 
+
+Immediately
+prior to the completion of this offering, we will adopt
+an audit committee charter, which will require the committee to review all related-party transactions on an ongoing basis and
+all such transactions will be approved by the committee.
+
+ 
+
+Set forth below are related
+party transactions of our Company for the fiscal years ended March 31, 2023 and 2024, for the six months ended September 30, 2023
+and 2024 and up to the date of this prospectus, which are identified in accordance with the rules prescribed under Form F-1 and Form
+20-F and may not be considered as related party transactions under Hong Kong law.
+
+ 
+
+The related party of the Company with whom transactions
+are reported in these financial statements are as follows:
+
+ 
+
+List
+of Related Parties 
+
+ 
+
+ 
+ Name
+ of Individual
+ 
+ Relationship
+ with the Company
+
+ 
+ Ms.
+ Seto Wai Yue
+ 
+ Shareholder
+ and Director of the Company
+
+ 
+ Exit
+ (HK) Limited
+
+ 
+ Ms.
+ Seto is a 40% shareholder and the sole director of Exit (HK)
+
+ 
+ Earthling
+ Catering Limited
+ 
+ Ms.
+ Seto is a 64% shareholder and a director of Earthling 
+
+ 
+ Exit
+ Catering Limited
+
+ Exit Operations Limited
+
+ I
+ Dao Cao Limited
+
+ 
+ Ms.
+ Seto is a 51% shareholder and a director of Exit Catering
+
+ Ms.
+ Seto is a 60% shareholder and a director of Exit Operations
+
+ Brother
+ of Ms. Seto is the sole shareholder and director of I Dao Cao
+
+ 
+ 
+
+Related
+party transactions for the six months ended September 30, 2023 and 2024 and as of March 31. 2024 and September 2024:
+
+ 
+
+Amount
+due from/(to) a shareholder
+
+ 
+
+ 
+ 
+ As of 
+ As of 
+
+ 
+ 
+ March 31, 2024 
+ September 30, 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Seto Wai Yue 
+ $2,950,434 
+ $(47,054)
+
+ 
+
+ 
+
+On
+April 10, 2024, Ms. Seto Wai Yue entered into an interest-free loan facility agreement with TIL, for a revolving loan facility agreement
+of up to HK$12,000,000 for the purposes of paying the costs and expenses in connection with the offering. As of September 2024, loan
+amount from Ms. Seto is approximately HK$1.93 million. The balances are unsecured, non-interest bearing, and payable on demand. The balances
+were recorded in current assets/liabilities.
+
+ 
+
+During
+the six months ended September 30, 2023 and 2024, the proceeds and payments to a shareholder are as follows
+
+ 
+
+ 
+ 
+ September 30, 2023 
+ September 30, 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Proceeds from a shareholder 
+ $1,236,520 
+ $7,065,391 
+
+ 
+ Payments to a shareholder 
+ (1,334,381) 
+ (4,067,903)
+
+ 
+
+ 
+
+The proceeds from and payments to a shareholder represented total cash movement, received from and paid to a shareholder during the relevant
+periods for her personal use temporarily, and loan from a shareholder for listing fees payments during the six months ended September
+30, 2024. The proceeds received from a shareholder primarily serve the Company s operational needs. These funds are directed towards
+day-to-day activities, ensuring the smooth functioning of the Company s business operations during the relevant periods and loan
+from a shareholder for listing fees payments during the six months ended September 30, 2024. Conversely, the payments made to a shareholder
+are for her personal use temporarily.
+
+ 
+
+During
+the six months ended September 30, 2023, the proceeds from and payments to a shareholder represented total cash movement, received from
+and paid to a shareholder during the relevant period for her personal use temporarily. The proceeds received from a shareholder primarily
+serve the Company s operational needs. These funds are directed towards day-to-day activities, ensuring the smooth functioning
+of the Company s business operations. Conversely, the payments made to Ms. Seto are for her personal use temporarily.
+
+ 
+
+Amount
+due from related parties
+
+ 
+
+ 
+ 
+ As of 
+ As of 
+
+ 
+ 
+ March 31, 2024 
+ September 30, 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ I Dao Cao Limited 
+ - 
+ 879,152 
+
+ 
+ Exit Operations Limited 
+ - 
+ 1,254,369 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ $- 
+ $2,133,521 
+
+ 
+
+ 
+
+For
+the amount due from I Dao Cao represented deposits for concert tickets for resell. The relevant concert tickets will be delivered before
+the concert commenced. The remaining balance due from Exit Operations Limited represented deposits for caf operation for events
+and will be used up when provision of caf services for upcoming events.
+
+ 
+
+ -119-
+
+ 
+
+ 
+
+ 
+
+Revenue
+
+ 
+
+ 
+ 
+ 
+ Six
+ months ended September 30,
+ 
+
+ 
+ 
+ 
+ 2023
+ 
+ 
+ 2024
+ 
+
+ 
+ 
+ 
+ HKD
+ 
+ 
+ HKD
+ 
+
+ 
+ Exit
+ (HK) Limited
+
+ 
+ 
+ 20,000
+ 
+ 
+ 
+ -
+ 
+
+ 
+ Exit
+ Catering Limited
+ 
+ 
+ 207,588
+ 
+ 
+ 
+ -
+ 
+
+ 
+ Exit Operations Limited
+ 
+ 
+ -
+ 
+ 
+ 
+ 552,166
+ 
+
+ 
+ 
+ 
+ $
+ 227,588
+ 
+ 
+ $
+ 552,166
+ 
+
+ 
+ 
+
+Cost
+of Revenue
+
+ 
+
+ 
+ 
+ Six months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ I Dao Cao Limited 
+ - 
+ 204,000 
+
+ 
+ Exit Operations Limited 
+ - 
+ 264,350 
+
+ 
+ 
+ $- 
+ $468,350 
+
+ 
+
+ 
+
+Defined
+contribution insurance to Ms. Seto
+
+ 
+
+During
+the six months ended September 30, 2024, the Company purchased insurance for Ms. Seto with defined contribution of US$50,000 per annum
+for the period of five years and recorded as selling, general and administrative expenses.
+
+ 
+
+Related
+party transactions for the years ended March 31, 2023 and 2024
+
+ 
+
+Amount
+due from a shareholder
+
+ 
+
+ 
+ 
+ As
+ of March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Ms. Seto 
+ $4,747,823 
+ $2,950,434 
+
+ 
+
+ 
+
+The amount due is
+unsecured, non-interest bearing, and payable on demand. The amount represented net proceeds and payments to Ms. Seto for her
+personal use temporarily. The balances were recorded in current assets. The remaining outstanding balances was fully repaid on
+September 16, 2024.
+
+ 
+
+During the years ended
+March 31, 2023 and 2024, the proceeds and payments to a shareholder are as follows:
+
+ 
+
+ 
+ 
+ Years ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Proceeds from a shareholder – Ms. Seto 
+ $793,266 
+ $18,039,849 
+
+ 
+ Payments to a shareholder – Ms. Seto 
+ (4,362,363) 
+ (21,742,460)
+
+ 
+
+ 
+
+The
+proceeds from and payments to a shareholder represented total cash movement, received from and paid to a shareholder
+during the relevant period for her personal use temporarily. The proceeds received
+from Ms. Seto primarily serve the Company s operational needs. These funds are directed towards day-to-day activities, ensuring
+the smooth functioning of the Company s business operations. Conversely, the payments made to Ms. Seto are for her personal use temporarily. The largest amount outstanding during the period is as below:
+
+ 
+
+ 
+ 
+ Years
+ ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Largest
+ amount outstanding during the period 
+ 5,541,089 
+ 26,490,282 
+
+ 
+ 
+
+As at the date of this prospectus, the outstanding
+amounts due from the shareholder has been fully repaid on September 16, 2024.
+
+ 
+
+Revenue
+
+ 
+
+ 
+ 
+ Years ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Exit
+ (HK) Limited
+ 
+ 
+ 
+
+ 
+ - 
+ Provision of event management services 
+ 1,907,953 
+ - 
+
+ 
+ - 
+ Sales of goods 
+ 380,935 
+ - 
+
+ 
+ - 
+ Design and others 
+ 110,000 
+ 20,000 
+
+ 
+ Exit Catering Limited – sale of goods 
+ - 
+ 317,586 
+
+ 
+ Earthling Catering Limited – design and others 
+ 78,340 
+ - 
+
+ 
+ 
+ $2,477,228 
+ $337,586 
+
+ 
+
+ 
+
+Dividend
+
+ 
+
+For the year ended March 31, 2024, Trendic declared and paid a dividend
+of HK$5,500,000 (approximately US$706,000) to its shareholders registered as such on March 30, 2024. The dividend was
+offset against amount due from a shareholder during the year ended March 31, 2024.
+
+ 
+
+Loan
+from Ms. Seto
+
+ 
+
+On
+April 10, 2024, Ms. Seto Wai Yue entered into an interest-free loan facility agreement with Trendic, for a revolving loan facility
+agreement of up to HK$12,000,000 for the purposes of paying the costs and expenses in connection with this offering. Such amount is
+repayable on the earlier of the completion of this offering and September 30, 2025. As of March 31, 2023, 2024 and the latest
+practicable date, the loan from Ms. Seto is HK$0, HK$0 and HK$3,663,215, respectively. The largest amount outstanding for loan from
+Ms. Seto during the years ended March 31, 2023, 2024 is HK$0 and HK$0 respectively, and the largest amount outstanding for loan from
+Ms. Seto during the six months ended September 30, 2023, 2024 and as at the date of this prospectus is HK$0, HK$1,933,527 and
+HK$3,663,215, respectively.
+
+ 
+
+ -120-
+
+ 
+
+ 
+
+ 
+
+DESCRIPTION
+OF SHARE CAPITAL 
+
+ 
+
+The
+following description of our share capital is a summary only and not meant to be complete, but is subject to and qualified in its entirety
+by our Memorandum and Articles of Association, as amended from time to time, and by the provisions of the applicable law.
+Reference is made to our Memorandum and Articles of Association, copies of which are filed as an exhibit to the
+registration statement of which this prospectus is a part.
+
+ 
+
+Our
+Company was incorporated on July 5, 2024, and immediately following incorporation, our share capital was held as to 1 Share by Ms. Seto.
+
+ 
+
+On
+August 19, 2024, Ms. Seto and Kilo Wonders subscribed for and were allotted and issued fully paid 19,059 and 940 Class A Ordinary Shares
+in the Company for cash at par, and a resolution was passed on the same day giving effect to the same.
+
+ 
+
+On
+August 19, 2024, Ms. Seto, Kilo Wonders and Yield Rights subscribed for and were allotted and issued fully paid 4,500,939, 234,059 and
+245,000 Class A Ordinary Shares in the Company for cash at par, and a resolution was passed on the same day giving effect to the same.
+
+ 
+
+On August 20, 2024, Fuji
+Holdings, Prime Crest and Allied Target entered into agreements to acquire 225,000, 245,000 and 230,000 Class A Ordinary Shares in the
+Company for US$250,000, US$270,000 and US$255,000 respectively, from Ms. Seto.
+
+ 
+
+On March
+6, 2025, one Class A Ordinary Share was allotted and issued to each of Ms. Seto and Kilo Wonders, credited as fully paid,
+in consideration of them transferring their entire equity interest in Trendic to our Group.
+
+ 
+
+On
+March 31, 2025, for purposes of recapitalization in anticipation of the initial public offering, the Company s shareholders passed
+resolutions to (i) sub-divide each of the issued and unissued shares in its share capital of par value US$0.0001 each into 10 shares
+of par value US$0.00001 each, (ii) to re-classify and re-designate its authorised share capital into 10,000,000,000 shares with a par
+value of US$0.00001 each comprising of (a) 9,500,000,000 Class A Ordinary Shares with a par value of US$0.00001 each and (b) 500,000,000
+Class B Ordinary Shares with a par value of US$0.00001 each and (iii) to adopt an amended and restated memorandum of association and
+articles of association reflecting such amended share capital and containing the rights, preferences and privileges attached to each
+class of shares. Concurrently, Ms. Seto, Prime Crest, Fuji Holdings, Kilo Wonders, Yield Rights and Allied Target surrendered 16,303,760,
+1,045,660, 960,300, 1,002,980, 1,045,660 and 981,640 Class A Ordinary Shares to the Company, respectively.
+
+ 
+
+On March 31, 2025
+the Company allotted and issued fully paid 1,000,000 Class B Ordinary Shares to Ms. Seto for cash at par, and a resolution was
+passed on March 31, 2025 giving effect to the same.
+
+ 
+
+Our Memorandum and Articles of Association
+
+ 
+
+The following are summaries
+of material provisions of our memorandum and articles of association and of the Companies Act, insofar as they relate to the material
+terms of our Class A Ordinary Shares.
+
+ 
+
+Objects
+of Our Company. Under our memorandum and articles of association, the objects of our company are unrestricted, and
+we are capable of exercising all the functions of a natural person of full capacity irrespective of any question of corporate benefit,
+as provided by section 27(2) of the Companies Act.
+
+ 
+
+Class A Ordinary Shares. Our Class A Ordinary Shares are issued
+in registered form and are issued when registered in our register of members. We may not issue shares to bearer. Our shareholders who
+are non-residents of the Cayman Islands may freely hold and vote their shares.
+
+ 
+
+Class B Ordinary Shares. Our Class B Ordinary Shares
+is entitled to twelve (12) votes on any matter on which action of the shareholders of the Company is sought and is convertible into
+one Class A Ordinary Share at the option of the holder thereof on a one-for-one basis.
+
+ 
+
+Dividends.
+Subject to the Companies Act and our Articles of Association, our Company by ordinary resolution in general meeting may declare dividends
+in any currency to be paid to the members but no dividend shall be declared in excess of the amount recommended by our board of directors.
+Our dividends may be declared and paid out of our profits, realized or unrealized, or from any reserve set aside from profits which our
+board of directors determine is no longer needed. Dividends may also be declared and paid out of share premium account or any other fund
+or account which can be authorized for this purpose in accordance with the Companies Act. No dividend may be declared and paid unless
+our directors determine that, immediately after the date of payment, we will be able to pay our debts as they become due in the ordinary
+course of business and we have funds lawfully available for such purpose.
+
+ 
+
+Except
+in so far as the rights attaching to, or the terms of issue of, any share may otherwise provide:
+
+ 
+
+(i)all
+ dividends shall be declared and paid according to the amounts paid up on the shares in respect
+ of which the dividend is paid, although no amount paid up on a share in advance of calls
+ shall for this purpose be treated as paid up on the share;
+
+ 
+
+(ii)all
+ dividends shall be apportioned and paid pro rata in accordance with the amount paid up on
+ the shares during any portion(s) of the period in respect of which the dividend is paid;
+ and
+
+ 
+
+(iii)our
+ Board may deduct from any dividend or other monies payable to any member all sums of money
+ (if any) presently payable by him to our Company on account of calls, instalments or otherwise.
+ Where our Board or our Company in general meeting has resolved that a dividend should be
+ paid or declared, our board of directors may resolve:
+
+ 
+
+a.that
+ such dividend be satisfied wholly or in part in the form of an allotment of shares credited
+ as fully paid up, provided that the members entitled to such dividend will be entitled to
+ elect to receive such dividend (or part thereof) in cash in lieu of such allotment; or 
+
+ 
+
+b.that
+ the members entitled to such dividend will be entitled to elect to receive an allotment of
+ shares credited as fully paid up in lieu of the whole or such part of the dividend as our
+ board of directors may think fit. 
+
+ 
+
+Upon
+the recommendation of our Board, our Company may by ordinary resolution in respect of any one particular dividend of our Company determine
+that it may be satisfied wholly in the form of an allotment of shares credited as fully paid up without offering any right to members
+to elect to receive such dividend in cash in lieu of such allotment.
+
+ 
+
+Any
+dividend, bonus or other sum payable in cash to the holder of shares may be paid by cheque or warrant sent through the post. Every such
+cheque or warrant shall be made payable to the order of the person to whom it is sent and shall be sent at the holder s or joint
+holders risk and payment of the cheque or warrant by the bank on which it is drawn shall constitute a good discharge to our Company.
+Any one of two or more joint holders may give effectual receipts for any dividends or other monies payable or property distributable
+in respect of the shares held by such joint holders.
+
+ 
+
+Whenever
+our Board or our Company in general meeting has resolved that a dividend be paid or declared, our Board may further resolve that such
+dividend be satisfied wholly or in part by the distribution of specific assets of any kind.
+
+ 
+
+Our
+Board may, if it thinks fit, receive from any member willing to advance the same, and either in money or money s worth, all or
+any part of the money uncalled and unpaid or instalments payable upon any shares held by him, and in respect of all or any of the monies
+so advanced may pay interest at such rate (if any) not exceeding 20% per annum, as our Board may decide, but a payment in advance of
+a call shall not entitle the member to receive any dividend or to exercise any other rights or privileges as a member in respect of the
+share or the due portion of the shares upon which payment has been advanced by such member before it is called up.
+
+ 
+
+All
+dividends, or distributions unclaimed for six years from the date of having been declared may be forfeited by our Board and, upon such
+forfeiture, shall revert to our Company.
+
+ 
+
+No
+dividend payable by our Company on or in respect of any share shall bear interest against our Company.
+
+ 
+
+ -121-
+
+ 
+
+ 
+
+ 
+
+CERTAIN
+CAYMAN ISLANDS COMPANY CONSIDERATIONS
+
+ 
+
+Differences
+in Corporate Law
+
+ 
+
+The
+Companies Act is derived, to a large extent, from the older Companies Acts of England but does not follow recent English statutory enactments
+and accordingly there are significant differences between the Companies Act and the current Companies Act of England. In addition, the
+Companies Act differs from laws applicable to U.S. corporations and their shareholders. Set forth below is a summary of the significant
+differences between the provisions of the Companies Act applicable to us and the laws applicable to companies incorporated in the United
+States and their shareholders.
+
+ 
+
+Mergers
+and Similar Arrangements. The Companies Act permits mergers and consolidations between Cayman Islands companies and between Cayman
+Islands companies and non-Cayman Islands companies. For these purposes, (a) "merger" means the merging of two or more constituent
+companies and the vesting of their undertaking, property and liabilities in one of such companies as the surviving company, and (b) a
+"consolidation" means the combination of two or more constituent companies into a consolidated company and the vesting of
+the undertaking, property and liabilities of such companies to the consolidated company. In order to effect such a merger or consolidation,
+the directors of each constituent company must approve a written plan of merger or consolidation, which must then be authorized by (a)
+a special resolution of the shareholders of each constituent company, and (b) such other authorization, if any, as may be specified in
+such constituent company s articles of association. The plan must be filed with the Registrar of Companies of the Cayman Islands
+together with a declaration as to the solvency of the consolidated or surviving company, a list of the assets and liabilities of each
+constituent company and an undertaking that a copy of the certificate of merger or consolidation will be given to the members and creditors
+of each constituent company and that notification of the merger or consolidation will be published in the Cayman Islands Gazette. Court
+approval is not required for a merger or consolidation which is effected in compliance with these statutory procedures.
+
+ 
+
+A
+merger between a Cayman parent company and its Cayman subsidiary or subsidiaries does not require authorization by a resolution of shareholders
+of that Cayman subsidiary if a copy of the plan of merger is given to every member of that Cayman subsidiary to be merged unless that
+member agrees otherwise. For this purpose, a company is a "parent" of a subsidiary if it holds issued shares that together
+represent at least ninety percent (90%) of the votes at a general meeting of the subsidiary.
+
+ 
+
+The
+consent of each holder of a fixed or floating security interest over a constituent company is required unless this requirement is waived
+by a court in the Cayman Islands.
+
+ 
+
+Save
+in certain limited circumstances, a shareholder of a Cayman constituent company who dissents from the merger or consolidation is entitled
+to payment of the fair value of his shares (which, if not agreed between the parties, will be determined by the Cayman Islands court)
+upon dissenting to the merger or consolidation, provided the dissenting shareholder complies strictly with the procedures set out in
+the Companies Act. The exercise of dissenter rights will preclude the exercise by the dissenting shareholder of any other rights to which
+he or she might otherwise be entitled by virtue of holding shares, save for the right to seek relief on the grounds that the merger or
+consolidation is void or unlawful.
+
+ 
+
+ -122-
+
+ 
+
+ 
+
+ 
+
+Separate
+from the statutory provisions relating to mergers and consolidations, the Companies Act also contains statutory provisions that facilitate
+the reconstruction and amalgamation of companies by way of schemes of arrangement, provided that the arrangement is approved (i) in the
+case of a shareholder scheme, by seventy-five per cent in value of the members or class of members, as the case may be, with whom the
+arrangement is to be made and (ii) in the case of a creditor scheme only, by a majority in number of each class of creditors with whom
+the arrangement is to be made and who must in addition represent seventy-five per cent in value of each such class of creditors, as the
+case may be, that are present and voting either in person or by proxy at a meeting, or meetings, convened for that purpose. The convening
+of the meetings and subsequently the arrangement must be sanctioned by the Grand Court of the Cayman Islands. While a dissenting shareholder
+has the right to express to the court the view that the transaction ought not to be approved, the court can be expected to approve the
+arrangement if it determines that:
+
+ 
+
+ the
+ statutory provisions as to the required majority vote have been met;
+
+ 
+
+ the
+ shareholders have been fairly represented at the meeting in question and the statutory majority
+ are acting bona fide without coercion of the minority to promote interests adverse to those
+ of the class;
+
+ 
+
+ the
+ arrangement is such that may be reasonably approved by an intelligent and honest man of that
+ class acting in respect of his interest; and
+
+ 
+
+ the
+ arrangement is not one that would more properly be sanctioned under some other provision
+ of the Companies Act.
+
+ 
+
+The
+Companies Act also contains a statutory power of compulsory acquisition which may facilitate the "squeeze out" of a dissentient
+minority shareholder upon a tender offer. When a tender offer is made and accepted by holders of 90% of the shares affected within four
+months, the offeror may, within a two-month period commencing on the expiration of such four-month period, require the holders of the
+remaining shares to transfer such shares to the offeror on the terms of the offer. An objection can be made to the Grand Court of the
+Cayman Islands, but this is unlikely to succeed in the case of an offer which has been so approved unless there is evidence of
+fraud, bad faith or collusion.
+
+ 
+
+If
+an arrangement and reconstruction by way of scheme of arrangement is thus approved and sanctioned, or if a tender offer is made and accepted,
+in accordance with the foregoing statutory procedures, a dissenting shareholder would have no rights comparable to appraisal rights,
+save that objectors to a takeover offer may apply to the Grand Court of the Cayman Islands for various orders that the Grand Court of
+the Cayman Islands has a broad discretion to make, which would otherwise ordinarily be available to dissenting shareholders of Delaware
+corporations, providing rights to receive payment in cash for the judicially determined value of the shares.
+
+ 
+
+The
+Companies Act also contains statutory provisions which provide that a company may present a petition to the Grand Court of the Cayman
+Islands for the appointment of a restructuring officer on the grounds that the company (a) is or is likely to become unable to pay its
+debts within the meaning of section 93 of the Companies Act; and (b) intends to present a compromise or arrangement to its creditors
+(or classes thereof) either, pursuant to the Companies Act, the law of a foreign country or by way of a consensual restructuring. The
+petition may be presented by a company acting by its directors, without a resolution of its members or an express power in its articles
+of association. On hearing such a petition, the Cayman Islands court may, among other things, make an order appointing a restructuring
+officer or make any other order as the court thinks fit.
+
+ 
+
+ -123-
+
+ 
+
+ 
+
+ 
+
+Shareholders 
+Suits. In principle, we will normally be the proper plaintiff and as a general rule a derivative action may not be brought by a minority
+shareholder. However, based on English authorities, which would in all likelihood be of persuasive authority in the Cayman Islands, the
+Cayman Islands courts can be expected to follow and apply the common law principles (namely the rule in Foss v. Harbottle and
+the exceptions thereto) so that a non-controlling shareholder may be permitted to commence a class action against or derivative actions
+in the name of the company to challenge actions where:
+
+ 
+
+ a
+ company acts or proposes to act illegally or ultra vires;
+
+ 
+
+ the
+ act complained of, although not ultra vires, could only be effected duly if authorized by
+ more than the number of votes which have actually been obtained; and
+
+ 
+
+ those
+ who control the company are perpetrating a "fraud on the minority."
+
+ 
+
+A
+shareholder may have a direct right of action against us where the individual rights of that shareholder have been infringed or are about
+to be infringed.
+
+ 
+
+Indemnification
+of Directors and Executive Officers and Limitation of Liability. Cayman Islands law does not limit the extent to which a company s
+memorandum and articles of association may provide for indemnification of officers and directors, except to the extent any such provision
+may be held by the Cayman Islands courts to be contrary to public policy, such as to provide indemnification against civil fraud or the
+consequences of committing a crime. Our memorandum and articles of association provide that that we shall indemnify our
+directors and officers, and their personal representatives, against all actions, proceedings, costs, charges, expenses, losses, damages
+or liabilities incurred or sustained by such persons, other than by reason of such person s dishonesty, willful default
+or fraud, in or about the conduct of our company s business or affairs (including as a result of any mistake of judgment) or in
+the execution or discharge of his duties, powers, authorities or discretions, including without prejudice to the generality of the foregoing,
+any costs, expenses, losses or liabilities incurred by such director or officer in defending (whether successfully or otherwise) any
+civil proceedings concerning our company or its affairs in any court whether in the Cayman Islands or elsewhere. This standard of conduct
+is generally the same as permitted under the Delaware General Corporation Law for a Delaware corporation.
+
+ 
+
+In
+addition, we have entered into indemnification agreements with our directors and executive officers that provide such persons with additional
+indemnification beyond that provided in our memorandum and articles of association.
+
+ 
+
+Insofar
+as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers or persons controlling
+us under the foregoing provisions, we have been informed that in the opinion of the SEC, such indemnification is against public policy
+as expressed in the Securities Act and is therefore unenforceable.
+
+ 
+
+Directors 
+Fiduciary Duties. Under Delaware corporate law, a director of a Delaware corporation has a fiduciary duty to the corporation and
+its shareholders. This duty has two components: the duty of care and the duty of loyalty. The duty of care requires that a director act
+in good faith, with the care that an ordinarily prudent person would exercise under similar circumstances. Under this duty, a director
+must inform himself of, and disclose to shareholders, all material information reasonably available regarding a significant transaction.
+The duty of loyalty requires that a director acts in a manner he reasonably believes to be in the best interests of the corporation.
+He must not use his corporate position for personal gain or advantage. This duty prohibits self-dealing by a director and mandates that
+the best interest of the corporation and its shareholders take precedence over any interest possessed by a director, officer or controlling
+shareholder and not shared by the shareholders generally. In general, actions of a director are presumed to have been made on an informed
+basis, in good faith and in the honest belief that the action taken was in the best interests of the corporation. However, this presumption
+may be rebutted by evidence of a breach of one of the fiduciary duties. Should such evidence be presented concerning a transaction by
+a director, the director must prove the procedural fairness of the transaction, and that the transaction was of fair value to the corporation.
+
+ 
+
+ -124-
+
+ 
+
+ 
+
+ 
+
+As
+a matter of Cayman Islands law, a director of a Cayman Islands company is in the position of a fiduciary with respect to the company
+and therefore it is considered that he owes the following duties to the company — a duty to act in good faith in the best interests
+of the company, a duty not to make a personal profit based on his position as director (unless the company permits him to do so), a duty
+not to put himself in a position where the interests of the company conflict with his personal interest or his duty to a third party
+and a duty to exercise powers for the purpose for which such powers were intended. A director of a Cayman Islands company owes to the
+company a duty to act with skill and care. It was previously considered that a director need not exhibit in the performance of his duties
+a greater degree of skill than may reasonably be expected from a person of his knowledge and experience. However, English and Commonwealth
+courts have moved towards an objective standard with regard to the required skill and care and these authorities are likely to be followed
+in the Cayman Islands.
+
+ 
+
+Shareholder
+Action by Written Consent. Under the Delaware General Corporation Law, a corporation may eliminate the right of shareholders to act
+by written consent by amendment to its certificate of incorporation. Cayman Islands law permits us to eliminate the right of shareholders
+to act by written consent and our post-offering amended and restated articles of association provide that any action required or permitted
+to be taken at any general meetings may be taken upon the vote of shareholders at a general meeting duly noticed and convened in accordance
+with our post-offering amended and restated articles of association and may not be taken by written consent of the shareholders without
+a meeting.
+
+ 
+
+Shareholder
+Proposals. Under the Delaware General Corporation Law, a shareholder has the right to put any proposal before the annual meeting
+of shareholders, provided it complies with the notice provisions in the governing documents. A special meeting may be called by the board
+of directors or any other person authorized to do so in the governing documents, but shareholders may be precluded from calling special
+meetings.
+
+ 
+
+The
+Companies Act does not provide shareholders with any right to requisition a general meeting or to put any proposal before a general meeting.
+However, these rights may be provided in a company s articles of association. Our post-offering amended and restated articles
+of association allow our shareholders holding shares which carry in aggregate not less than one-third of all votes attaching to the issued
+and outstanding shares of our company entitled to vote at general meetings to requisition an extraordinary general meeting of our shareholders,
+in which case our board is obliged to convene an extraordinary general meeting and to put the resolutions so requisitioned to a vote
+at such meeting. Other than this right to requisition a shareholders meeting, our post-offering amended and restated articles
+of association do not provide our shareholders with any other right to put proposals before annual general meetings or extraordinary
+general meetings. As an exempted Cayman Islands company, we are not obliged by law to call shareholders annual general meetings.
+
+ 
+
+ -125-
+
+ 
+
+ 
+
+ 
+
+Cumulative
+Voting. Under the Delaware General Corporation Law, cumulative voting for elections of directors is not permitted unless the corporation s
+certificate of incorporation specifically provides for it. Cumulative voting potentially facilitates the representation of minority shareholders
+on a board of directors since it permits the minority shareholder to cast all the votes to which the shareholder is entitled on a single
+director, which increases the shareholder s voting power with respect to electing such director. There are no prohibitions in relation
+to cumulative voting under the laws of the Cayman Islands, but our post-offering amended and restated articles of association
+do not provide for cumulative voting. As a result, our shareholders are not afforded any less protections or rights on this issue than
+shareholders of a Delaware corporation.
+
+ 
+
+Removal
+of Directors. Under the Delaware General Corporation Law, a director of a corporation with a classified board may be removed only
+for cause with the approval of a majority of the outstanding shares entitled to vote, unless the certificate of incorporation provides
+otherwise. Under our post-offering amended and restated articles of association, subject to certain restrictions as contained therein,
+directors may be removed with or without cause, by an ordinary resolution of our shareholders. An appointment of a director may be on
+terms that the director shall automatically retire from office (unless he has sooner vacated office) at the next or a subsequent annual
+general meeting or upon any specified event or after any specified period in a written agreement between the company and the director,
+if any; but no such term shall be implied in the absence of express provision. Under our post-offering amended and restated articles
+of association, a director s office shall be vacated if the director (i) becomes bankrupt or has a receiving order made against
+him or suspends payment or compounds with his creditors; (ii) is found to be or becomes of unsound mind or dies; (iii) resigns his office
+by notice in writing to the company; (iv) without special leave of absence from our board of directors, is absent from three consecutive
+meetings of the board and the board resolves that his office be vacated; (v) is prohibited by law from being a director or; (vi) is removed
+from office pursuant to the laws of the Cayman Islands or any other provisions of our memorandum and articles of association.
+
+ 
+
+Transactions
+with Interested Shareholders. The Delaware General Corporation Law contains a business combination statute applicable to Delaware
+corporations whereby, unless the corporation has specifically elected not to be governed by such statute by amendment to its certificate
+of incorporation, it is prohibited from engaging in certain business combinations with an "interested shareholder" for three
+years following the date that such person becomes an interested shareholder. An interested shareholder generally is a person or a group
+who or which owns or owned 15% or more of the target s outstanding voting share within the past three years. This has the effect
+of limiting the ability of a potential acquirer to make a two-tiered bid for the target in which all shareholders would not be treated
+equally. The statute does not apply if, among other things, prior to the date on which such shareholder becomes an interested shareholder,
+the board of directors approves either the business combination or the transaction which resulted in the person becoming an interested
+shareholder. This encourages any potential acquirer of a Delaware corporation to negotiate the terms of any acquisition transaction with
+the target s board of directors.
+
+ 
+
+Cayman
+Islands law has no comparable statute. As a result, we cannot avail ourselves of the types of protections afforded by the Delaware business
+combination statute. However, although Cayman Islands law does not regulate transactions between a company and its significant shareholders,
+it does provide that such transactions must be entered into bona fide in the best interests of the company and not with the effect of
+constituting a fraud on the minority shareholders.
+
+ 
+
+ -126-
+
+ 
+
+ 
+
+ 
+
+Dissolution;
+Winding up. Under the Delaware General Corporation Law, unless the board of directors approves the proposal to dissolve, dissolution
+must be approved by shareholders holding 100% of the total voting power of the corporation. Only if the dissolution is initiated by the
+board of directors may it be approved by a simple majority of the corporation s outstanding shares. Delaware law allows a Delaware
+corporation to include in its certificate of incorporation a supermajority voting requirement in connection with dissolutions initiated
+by the board.
+
+ 
+
+Under
+Cayman Islands law, a company may be wound up by either an order of the courts of the Cayman Islands or by a special resolution of its
+members or, if the company is unable to pay its debts, by an ordinary resolution of its members. The court has authority to order winding
+up in a number of specified circumstances including where it is, in the opinion of the court, just and equitable to do so.
+
+ 
+
+Variation
+of Rights of Shares. Under the Delaware General Corporation Law, a corporation may vary the rights of a class of shares with the
+approval of a majority of the outstanding shares of such class, unless the certificate of incorporation provides otherwise. Under our
+post-offering amended and restated articles of association, if our share capital is divided into more than one class of shares, the rights
+attached to any such class may only be varied with the sanction of a resolution passed by a majority of two-thirds of the votes cast
+at a separate meeting of the holders of the shares of that class.
+
+ 
+
+Amendment
+of Governing Documents. Under the Delaware General Corporation Law, a corporation s governing documents may be amended with
+the approval of a majority of the outstanding shares entitled to vote, unless the certificate of incorporation provides otherwise. Under
+Cayman Islands law, our memorandum and articles of association may only be amended with a special resolution of our shareholders.
+
+ 
+
+Rights
+of Non-resident or Foreign Shareholders. There are no limitations imposed by our memorandum and articles of association
+on the rights of non-resident or foreign shareholders to hold or exercise voting rights on our shares. In addition, there are no provisions
+in our memorandum and articles of association governing the ownership threshold above which shareholder ownership must
+be disclosed.
+
+ 
+
+Cayman
+Islands Data Protection
+
+ 
+
+We
+have certain duties under the Data Protection Act (as revised) of the Cayman Islands, or the DPA, based on internationally accepted principles
+of data privacy.
+
+ 
+
+Privacy
+Notice
+
+ 
+
+This
+privacy notice puts our shareholders on notice that through your investment into us you will provide us with certain personal information
+which constitutes personal data within the meaning of the DPA, or personal data.
+
+ 
+
+Investor
+Data
+
+ 
+
+We
+will collect, use, disclose, retain and secure personal data to the extent reasonably required only and within the parameters that could
+be reasonably expected during the normal course of business. We will only process, disclose, transfer or retain personal data to the
+extent legitimately required to conduct our activities of on an ongoing basis or to comply with legal and regulatory obligations to which
+we are subject. We will only transfer personal data in accordance with the requirements of the DPA, and will apply appropriate technical
+and organizational information security measures designed to protect against unauthorized or unlawful processing of the personal data
+and against the accidental loss, destruction or damage to the personal data.
+
+ 
+
+ -127-
+
+ 
+
+ 
+
+ 
+
+In
+our use of this personal data, we will be characterized as a "data controller" for the purposes of the DPA, while our affiliates
+and service providers who may receive this personal data from us in the conduct of our activities may either act as our "data processors"
+for the purposes of the DPA or may process personal information for their own lawful purposes in connection with services provided to
+us.
+
+ 
+
+We
+may also obtain personal data from other public sources. Personal data includes, without limitation, the following information relating
+to a shareholder and/or any individuals connected with a shareholder as an investor: name, residential address, email address, contact
+details, corporate contact information, signature, nationality, place of birth, date of birth, tax identification, credit history, correspondence
+records, passport number, bank account details, source of funds details and details relating to the shareholder s investment activity.
+
+ 
+
+Who
+this Affects
+
+ 
+
+If
+you are a natural person, this will affect you directly. If you are a corporate investor (including, for these purposes, legal arrangements
+such as trusts or exempted limited partnerships) that provides us with personal data on individuals connected to you for any reason in
+relation your investment in us, this will be relevant for those individuals and you should transit the content of this Privacy Notice
+to such individuals or otherwise advise them of its content.
+
+ 
+
+How
+We May Use a Shareholder s Personal Data
+
+ 
+
+We
+may, as the data controller, collect, store and use personal data for lawful purposes, including, in particular: (i) where this is necessary
+for the performance of our rights and obligations under any agreements; (ii) where this is necessary for compliance with a legal and
+regulatory obligation to which we are or may be subject (such as compliance with anti-money laundering and FATCA/CRS requirements); and/or
+(iii) where this is necessary for the purposes of our legitimate interests and such interests are not overridden by your interests, fundamental
+rights or freedoms.
+
+ 
+
+Should
+we wish to use personal data for other specific purposes (including, if applicable, any purpose that requires your consent), we will
+contact you.
+
+ 
+
+Why
+We May Transfer Your Personal Data
+
+ 
+
+In
+certain circumstances we may be legally obliged to share personal data and other information with respect to your shareholding with the
+relevant regulatory authorities such as the Cayman Islands Monetary Authority or the Tax Information Authority. They, in turn, may exchange
+this information with foreign authorities, including tax authorities.
+
+ 
+
+We
+anticipate disclosing personal data to persons who provide services to us and their respective affiliates (which may include certain
+entities located outside the US, the Cayman Islands or the European Economic Area), who will process your personal data on our behalf.
+
+ 
+
+ -128-
+
+ 
+
+ 
+
+ 
+
+The
+Data Protection Measures We Take
+
+ 
+
+Any
+transfer of personal data by us or our duly authorized affiliates and/or delegates outside of the Cayman Islands shall be in accordance
+with the requirements of the DPA.
+
+ 
+
+We
+and our duly authorized affiliates and/or delegates shall apply appropriate technical and organizational information security measures
+designed to protect against unauthorized or unlawful processing of personal data, and against accidental loss or destruction of, or damage
+to, personal data.
+
+ 
+
+We
+shall notify you of any personal data breach that is reasonably likely to result in a risk to your interests, fundamental rights or freedoms
+or those data subjects to whom the relevant personal data relates.
+
+ 
+
+Contacting
+the Company
+
+ 
+
+For
+further information on the collection, use, disclosure, transfer or processing of your personal data or the exercise of any of the rights
+listed above, please contact us through our website at http://www.trendicint.com or through phone number +852 5628 6281.
+
+ 
+
+Anti-Money
+Laundering Matters
+
+ 
+
+In
+order to comply with legislation or regulations aimed at the prevention of money laundering, the Company may be required to adopt and
+maintain anti-money laundering procedures, and may require subscribers to provide evidence to verify their identity. Where permitted,
+and subject to certain conditions, the Company may also delegate the maintenance of our anti-money laundering procedures (including the
+acquisition of due diligence information) to a suitable person.
+
+ 
+
+The
+Company reserves the right to request such information as is necessary to verify the identity of a subscriber. In the event of delay
+or failure on the part of the subscriber in producing any information required for verification purposes, we may refuse to accept the
+application, in which case any funds received will be returned without interest to the account from which they were originally debited.
+
+ 
+
+ -129-
+
+ 
+
+ 
+
+ 
+
+History
+of Securities Issuances or Sale
+
+ 
+
+The
+following is a summary of our material securities issuances or sale in the past three years before this offering.
+
+ 
+
+ 
+ Name
+ of shareholders 
+ Date
+ of Sale
+
+ or Issuance 
+ Number
+ of Class A Ordinary Shares 
+ Number
+ of Class B Ordinary Shares
+ 
+ 
+ Consideration 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Ms. Seto(1) 
+ July
+ 5, 2024 
+ 1 
+ - 
+ par
+ value per share 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ August
+ 19, 2024 
+ 4,500,939 
+ 
+ par
+ value per share 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ March 6, 2025 
+ 1 
+ 
+ Ms.
+ Seto and Ms. Yip to transfer Trendic to the Company s nominee, Goal Success 
+
+ 
+ 
+ March
+ 31, 2025 
+ - 
+ 1,000,000 
+ par
+ value per share 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Kilo Wonders (2) 
+ August
+ 19, 2024 
+ 940 
+ 
+ par
+ value per share 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ August
+ 19, 2024 
+ 234,059 
+ - 
+ par
+ value per share 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ 
+ March 6, 2025 
+ 1 
+ 
+ Ms.
+ Seto and Ms. Yip to transfer Trendic to the Company s nominee, Goal Success 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Yield Rights 
+ August
+ 19, 2024 
+ 245,000 
+ - 
+ par
+ value per share 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Fuji Holdings 
+ August
+ 20, 2024 
+ 225,000 
+ - 
+ US$250,000
+ (acquired from Ms. Seto) 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Prime Crest 
+ August
+ 20, 2024 
+ 245,000 
+ - 
+ US$270,000
+ (acquired from Ms. Seto) 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Allied Target 
+ August
+ 20, 2024 
+ 230,000 
+ - 
+ US$255,000
+ (acquired from Ms. Seto) 
+
+ 
+
+ 
+
+Other
+than the issuance of securities stated above, we have not issued any securities in the past three years.
+
+ 
+
+(1)Ms.
+ Seto was the existing controlling shareholder of Trendic prior to a group reorganization
+ whereby Trendic was transferred to the Company s nominee subsidiary, Goal Success.
+
+ 
+
+(2)Kilo
+ Wonders is wholly-owned by Ms. Yip, an existing shareholder of Trendic prior to a group reorganization
+ whereby Trendic was transferred to the Company s nominee subsidiary, Goal Success.
+
+ 
+
+ -130-
+
+ 
+
+ 
+
+ 
+
+SHARES
+ELIGIBLE FOR FUTURE SALE
+
+ 
+
+Upon
+completion of this offering, we will have 30,000,000 Class A Ordinary Shares and 1,000,000 Class B Ordinary Shares issued and
+outstanding.
+
+ 
+
+All
+of the Class A Ordinary Shares sold in this offering by the Company and by the Selling Shareholder will be freely transferable
+in the United States by persons other than our "affiliates" without restriction or further registration under the Securities
+Act. Rule 144 of the Securities Act defines an "affiliate" of a company as a person that, directly or indirectly, through
+one or more intermediaries, controls or is controlled by, or is under common control with, our Company. All of our Class A Ordinary Shares
+outstanding immediately prior to the completion of this offering are "restricted securities" as that term is defined
+in Rule 144 because they were issued in a transaction or series of transactions not involving a public offering. Restricted securities
+may be sold only if they are the subject of an effective registration statement under the Securities Act or if they are sold pursuant
+to an exemption from the registration requirement of the Securities Act such as those provided for in Rules 144 promulgated under the
+Securities Act, which rule is summarized below. Restricted shares may also be sold outside of the United States to non-U.S. persons in
+accordance with Rule 904 of Regulation S under the Securities Act. This prospectus may not be used in connection with any resale of our
+Class A Ordinary Shares acquired in this offering by our affiliates.
+
+ 
+
+Sales
+of substantial amounts of our Class A Ordinary Shares in the public market could adversely affect prevailing market prices of our Class A Ordinary Shares. Prior to this offering, there has been no public market for our Class A Ordinary Shares, and while we intend to apply for
+the listing of our Class A Ordinary Shares on the Nasdaq, we cannot assure you that a regular trading market will develop in the Class A Ordinary Shares.
+
+ 
+
+Lock-Up
+Agreements
+
+ 
+
+We
+have agreed with the underwriter, for a period of 180 days following the closing of the offering, subject to certain exceptions not to
+(1) offer, sell, issue, pledge, contract to sell, contract to purchase, grant any option, right or warrant to purchase, lend, make any
+short sale or otherwise transfer or dispose of, directly or indirectly, any Class A Ordinary Shares or any other securities so owned convertible
+into or exercisable or exchangeable for Class A Ordinary Shares, (2) enter into any swap, hedge or any other agreement that transfers,
+in whole or in part, the economic consequences of ownership of the Class A Ordinary Shares, whether any such transaction described in
+clause (1) or (2) above is to be settled by delivery of Class A Ordinary Shares or such other securities, in cash or otherwise, or (3)
+file any registration statement with the SEC relating to the offering of any Class A Ordinary Shares or any securities convertible into
+or exercisable or exchangeable for Class A Ordinary Shares, or publicly disclose the intention to take any such action.
+
+ 
+
+Furthermore,
+each of our directors and executive officers and our 5% or greater shareholders, except where applicable as a Resale Shareholder pursuant
+to the Resale Prospectus or as the Selling Shareholder with respect to the 660,000 Ordinary Shares sold in this offering, has also
+entered into a similar lock-up agreement with the underwriter for a period of 180 days following the closing of the offering, subject
+to certain exceptions, with respect to our Class A Ordinary Shares, and securities that are substantially similar to our Class A Ordinary
+Shares. See "Underwriting - Lock-up Agreements".
+
+ 
+
+We
+cannot predict what effect, if any, future sales of our Class A Ordinary Shares, or the availability of Class A Ordinary Shares for future
+sale, will have on the trading price of our Class A Ordinary Shares from time to time. Sales of substantial amounts of our Class A Ordinary Shares in the public market, or the perception that these sales could occur, could adversely affect the trading price of our Class A Ordinary Shares.
+
+ 
+
+ -131-
+
+ 
+
+ 
+
+ 
+
+Rule
+144
+
+ 
+
+In
+general, under Rule 144 as currently in effect, once we have been subject to the public company reporting requirements of Section 13
+or Section 15(d) of the Exchange Act for at least 90 days, persons who are not our affiliates and have beneficially owned our Class A Ordinary Shares for more than six months but not more than one year may sell such Class A Ordinary Shares without registration under the Securities
+Act subject to the availability of current public information about us. Persons who are not our affiliates and have beneficially owned
+our Class A Ordinary Shares for more than one year may freely sell our Class A Ordinary Shares without registration under the Securities
+Act. Persons who are our affiliates (including persons beneficially owning 10% or more of our outstanding shares), and have beneficially
+owned our Class A Ordinary Shares for at least six months, may sell within any three-month period a number of restricted securities that
+does not exceed the greater of the following:
+
+ 
+
+ 
+ 
+ 1.0%
+ of the then outstanding Class A Ordinary Shares; or
+
+ 
+ 
+ 
+
+ 
+ 
+ the
+ average weekly trading volume of our Class A Ordinary Shares during the four calendar weeks preceding the date on which notice of
+ the sale on Form 144 is filed with the SEC by such person.
+
+ 
+ 
+
+Such
+sales are also subject to manner-of-sale provisions, notice requirements and the availability of current public information about us.
+In addition, in each case, these shares would remain subject to any applicable lock-up arrangements and would only become eligible for
+sale when the lock-up period expires.
+
+ 
+
+Rule
+701
+
+ 
+
+In
+general, under Rule 701 of the Securities Act as currently in effect, each of our employees, consultants, or advisors who purchases our
+Class A Ordinary Shares from us in connection with a compensatory stock plan or other written agreement executed prior to the completion
+of this offering is eligible to resell those Class A Ordinary Shares in reliance on Rule 144, but without compliance with some of the
+restrictions, including the holding period, contained in Rule 144. However, the Rule 701 shares would remain subject to lock-up arrangements
+and would only become eligible for sale when the lock-up period expires.
+
+ 
+
+Resale Prospectus
+
+As described in the Explanatory Note to the
+registration statement of which this prospectus forms a part, the registration statement also contains the Resale Prospectus to be
+used in connection with the potential resale by the Resale Shareholders of our Class A Ordinary Shares held by them. These Class A Ordinary Shares
+have been registered to permit public resale of such shares, and the Resale Shareholders may offer the shares for resale from time
+to time pursuant to the Resale Prospectus. The Resale Shareholders may also sell, transfer or otherwise dispose of all or a portion
+of their shares in transactions exempt from the registration requirements of the Securities Act or pursuant to another effective
+registration statement covering those shares. No shares may be sold by the Resale Shareholders until our Class A Ordinary Shares are listed
+or quoted on an established public trading market. Thereafter, any sales will occur at prevailing market prices or
+in privately negotiated prices. None of the Class A Ordinary Shares registered for resale pursuant to the Resale Prospectus is underwritten
+by the Underwriter and will not form a part of this offering.
+
+ 
+
+Form
+S-8
+
+ 
+
+We
+intend to file a registration statement on Form S-8 under the Securities Act covering all ordinary shares which are either subject to
+outstanding options issued upon exercise of any options or other equity awards which may be granted or issued in the future pursuant
+to our share incentive plans. We expect to file this registration statement as soon as practicable after the date of this prospectus.
+Shares registered under any registration statements will be available for sale in the open market, except to the extent that the shares
+are subject to vesting restrictions with us or the contractual restrictions.
+
+ 
+
+ -132-
+
+ 
+
+ 
+
+ 
+
+MATERIAL
+TAX CONSIDERATIONS
+
+ 
+
+The
+following summary of certain Cayman Islands, Hong Kong and U.S. federal income tax consequences of an investment in our Class A Ordinary Shares
+is based upon laws and relevant interpretations thereof in effect as of the date of this prospectus, all of which are subject to
+change. This summary does not deal with all possible tax consequences relating to an investment in the Class A Ordinary Shares, such as
+the tax consequences under U.S. state and local tax laws or under the tax laws of jurisdictions other than the Cayman Islands, Hong Kong
+and the United States. You are encouraged to consult your own tax advisors concerning the overall tax consequences arising in your own
+particular situation under U.S. federal, state, local or foreign law of the ownership of our Class A Ordinary Shares. To the extent that
+this discussion relates to matters of Cayman Islands tax law, it is the opinion of Conyers Dill & Pearman, our counsel as to Cayman
+Islands law. To the extent that this discussion relates to matters of Hong Kong tax law, it is the opinion of Robertsons, our counsel
+as to Hong Kong law.
+
+ 
+
+Cayman
+Islands Tax Considerations
+
+ 
+
+The
+Cayman Islands currently levies no taxes on individuals or corporations based upon profits, income, gains or appreciation and there is
+no taxation in the nature of inheritance tax or estate duty. There are no other taxes likely to be material to us levied by the government
+of the Cayman Islands except for stamp duties which may be applicable on instruments executed in, or, after execution, brought within
+the jurisdiction of the Cayman Islands. The Cayman Islands is not party to any double tax treaties that are applicable to any payments
+made to or by our Company. There are no exchange control regulations or currency restrictions in the Cayman Islands.
+
+ 
+
+Payments
+of dividends and capital in respect of our Class A Ordinary Shares will not be subject to taxation in the Cayman Islands and no
+withholding will be required on the payment of a dividend or capital to any holder of our Class A Ordinary Shares, nor will gains derived
+from the disposal of our Class A Ordinary Shares be subject to Cayman Islands income or corporation tax.
+
+ 
+
+No
+stamp duty is payable in respect of the issue of our Class A Ordinary Shares or on an instrument of transfer in respect of our Class A Ordinary Shares.
+
+ 
+
+The
+Cayman Islands enacted the International Tax Co-operation (Economic Substance) Act (2024 Revision) together with the Guidance Notes published
+by the Cayman Islands Tax Information Authority from time to time. A Cayman Islands company is required to comply with the economic substance
+requirements from July 1, 2019 and make an annual report in the Cayman Islands as to whether or not it is carrying on any relevant activities
+and if it is, it must satisfy an economic substance test.
+
+ 
+
+Hong
+Kong Tax Considerations
+
+ 
+
+The
+following brief description of HK laws is designed to highlight the enterprise-level taxation on our earnings, which will affect the
+amount of dividends, if any, we are ultimately able to pay to our shareholders. See "Dividend Policy."
+
+ 
+
+ -133-
+
+ 
+
+ 
+
+ 
+
+Profits
+tax
+
+ 
+
+No
+tax is imposed in HK in respect of capital gains from the sale of property, such as our Class A Ordinary Shares. Generally, gains arising
+from disposal of the Class A Ordinary Shares which are held more than two years are considered capital in nature. However, trading gains
+from the sale of property by persons carrying on a trade, profession or business in HK where such gains are derived from or arise in
+HK from such trade, profession or business will be chargeable to HK profit tax. Liability for HK profits tax would therefore arise in
+respect of trading gains from the sale of Class A Ordinary Shares realized by persons in the course of carrying on a business of trading
+or dealing in securities in HK where the purchase or sale contracts are effected (being negotiated, concluded and/or executed) in HK.
+Effective from April 1, 2018, profits tax is levied on a two-tiered profits tax rate basis, with the first HK$2 million of profits being
+taxed at 8.25% for corporations and 7.5% for unincorporated businesses, and profits exceeding the first HK$2 million being taxed at 16.5%
+for corporations and 15% for unincorporated businesses.
+
+ 
+
+In
+addition, HK does not impose withholding tax on gains derived from the sale of stock in HK companies and does not impose withholding
+tax on dividends paid outside of HK by HK companies. Accordingly, investors will not be subject to HK withholding tax with respect to
+a disposition of their Class A Ordinary Shares or with respect to the receipt of dividends on their Class A Ordinary Shares, if any. No
+income tax treaty relevant to the acquiring, withholding or dealing in the Class A Ordinary Shares exists between HK and the United States.
+
+ 
+
+Stamp
+duty
+
+ 
+
+HK
+stamp duty is generally payable on the transfer of "Hong Kong stocks." The term "stocks" refers to shares in
+companies incorporated in HK, as widely defined under the Stamp Duty Ordinance (Cap. 117 of the laws of Hong Kong), or SDO, and includes
+shares. However, our Class A Ordinary Shares are not considered "Hong Kong stocks" under the SDO since the transfer of the
+Class A Ordinary Shares are not required to be registered in HK given that the books for the transfer of Class A Ordinary Shares are located
+in the United States. The transfer of Class A Ordinary Shares is therefore not subject to stamp duty in HK. If HK stamp duty applies,
+both the purchaser and the seller are liable for the stamp duty charged on each of the sold note and bought note at the ad valorem rate
+of 0.1% on the higher of the consideration stated on the contract notes or the fair market value of the shares transferred. In addition,
+a fixed duty, currently of HK$5.00, is payable on an instrument of transfer.
+
+ 
+
+ -134-
+
+ 
+
+ 
+
+ 
+
+There
+are currently no withholding taxes or exchange control regulations in the BVI applicable to the Company or its members.
+
+ 
+
+United
+States Federal Income Tax Considerations
+
+ 
+
+The
+following discussion is a summary of U.S. federal income tax considerations generally applicable to the ownership and disposition of
+our Class A Ordinary Shares by U.S. Holders (as defined below) that acquire our Class A Ordinary Shares in this offering and hold our Class A Ordinary Shares as "capital assets" (generally, property held for investment) under the United States Internal Revenue Code of
+1986, as amended, or the Code. This discussion is based upon existing United States federal income tax law which is subject to differing
+interpretations or change, possibly with retroactive effect. There can be no assurance that the Internal Revenue Service, or the IRS,
+or a court will not take a contrary position. This discussion does not address all aspects of United States federal income taxation that
+may be relevant to particular investors in light of their specific circumstances, including investors subject to special tax rules (for
+example, certain financial institutions (including banks), cooperatives, pension plans, insurance companies, broker-dealers, traders
+in securities that have elected the mark-to-market method of accounting for their securities, partnerships and their partners, regulated
+investment companies, real estate investment trusts, and tax-exempt organizations (including private foundations)), investors who are
+not U.S. Holders, investors who own (directly, indirectly, or constructively) 10% or more of our stock (by vote or value), investors
+that will hold their Class A Ordinary Shares as part of a straddle, hedge, conversion, constructive sale, or other integrated transaction
+for United States federal income tax purposes, or U.S. Holders that have a functional currency other than the U.S. dollar, all of whom
+may be subject to tax rules that differ significantly from those summarized below. In addition, this discussion does not discuss any
+non-United States tax, state or local tax, or non-income tax (such as the U.S. federal gift or estate tax) considerations, or any consequences
+under the alternative minimum tax or Medicare tax on net investment income. Each U.S. Holder is urged to consult its tax advisor regarding
+the United States federal, state, local, and non-United States income and other tax considerations of an investment in our Class A Ordinary Shares.
+
+ 
+
+General
+
+ 
+
+For
+purposes of this discussion, a "U.S. Holder" is a beneficial owner of our Class A Ordinary Shares that is, for United States
+federal income tax purposes, (i) an individual who is a citizen or resident of the United States, (ii) a corporation (or other entity
+treated as a corporation for United States federal income tax purposes) created in, or organized under the laws of, the United States
+or any state thereof or the District of Columbia, (iii) an estate the income of which is includible in gross income for United States
+federal income tax purposes regardless of its source, or (iv) a trust (A) the administration of which is subject to the primary supervision
+of a United States court and which has one or more United States persons who have the authority to control all substantial decisions
+of the trust or (B) that has otherwise validly elected to be treated as a United States person under the Code.
+
+ 
+
+If
+a partnership (or other entity or arrangement treated as a partnership for United States federal income tax purposes) is a beneficial
+owner of our Class A Ordinary Shares, the tax treatment of a partner in the partnership will generally depend upon the status of the partner
+as a U.S. Holder, as described above, and the activities of the partnership. Partnerships holding our Class A Ordinary Shares and partners
+in such partnerships are urged to consult their tax advisors as to the particular United States federal income tax consequences of an
+investment in our Class A Ordinary Shares.
+
+ 
+
+ -135-
+
+ 
+
+ 
+
+ 
+
+Dividends
+
+ 
+
+The
+entire amount of any cash distribution paid with respect to our Class A Ordinary Shares (including the amount of any non-U.S. taxes withheld
+therefrom, if any) generally will constitute dividends to the extent such distributions are paid out of our current or accumulated earnings
+and profits, as determined under United States federal income tax principles, and generally will be taxed as ordinary income in the year
+received by such U.S. Holder. To the extent amounts paid as distributions on the Class A Ordinary Shares exceed our current or accumulated
+earnings and profits, such distributions will not be dividends, but instead will be treated first as a tax-free return of capital to
+the extent of the U.S. Holder s adjusted tax basis, determined for federal income tax purposes, in the Class A Ordinary Shares with
+respect to which the distribution is made, and thereafter as capital gain. However, we do not intend to compute (or to provide U.S. Holders
+with the information necessary to compute) our earnings and profits under United States federal income tax principles. Accordingly, a
+U.S. Holder will be unable to establish that a distribution is not out of earnings and profits and should expect to treat the full amount
+of each distribution as a "dividend" for United States federal income tax purposes.
+
+ 
+
+Any
+dividends that we pay will generally be treated as income from foreign sources for United States foreign tax credit purposes and will
+generally constitute passive category income. Depending on the U.S. Holder s particular facts and circumstances, a U.S. Holder
+may be eligible, subject to a number of complex limitations, to claim a foreign tax credit in respect of any foreign withholding taxes
+imposed (at a rate not exceeding any applicable treaty rate) on dividends received on our Class A Ordinary Shares. A U.S. Holder who does
+not elect to claim a foreign tax credit for foreign tax withheld may instead claim a deduction, for United States federal income tax
+purposes, in respect of such withholdings, but only for a year in which such U.S. Holder elects to do so for all creditable foreign income
+taxes. The rules governing the foreign tax credit are complex. U.S. Holders are advised to consult their tax advisors regarding the availability
+of the foreign tax credit under their particular circumstances.
+
+ 
+
+Dividends
+paid in non-U.S. currency will be included in the gross income of a U.S. Holder in a U.S. dollar amount calculated by reference to a
+spot market exchange rate in effect on the date that the dividends are received by the U.S. Holder, regardless of whether such foreign
+currency is in fact converted into U.S. dollars on such date. Such U.S. Holder will have a tax basis for United States federal income
+tax purposes in the foreign currency received equal to that U.S. dollar value. If such dividends are converted into U.S. dollars on the
+date of receipt, a U.S. Holder generally should not be required to recognize foreign currency gain or loss in respect thereof. If the
+foreign currency so received is not converted into U.S. dollars on the date of receipt, such U.S. Holder will have a basis in the foreign
+currency equal to its U.S. dollar value on the date of receipt. Any gain or loss on a subsequent conversion or other disposition of the
+foreign currency generally will be treated as ordinary income or loss to such U.S. Holder and generally will be income or loss from sources
+within the United States for foreign tax credit limitation purposes. U.S. Holders should consult their own tax advisors regarding the
+treatment of foreign currency gain or loss, if any, on any foreign currency received by a U.S. Holder that are converted into U.S. dollars
+on a date subsequent to receipt.
+
+ 
+
+ -136-
+
+ 
+
+ 
+
+ 
+
+Sale
+or Other Disposition of Class A Ordinary Shares
+
+ 
+
+A
+U.S. Holder will generally recognize capital gain or loss upon a sale or other disposition of Class A Ordinary Shares, in an amount equal
+to the difference between the amount realized and the U.S. Holder s adjusted tax basis, determined for federal income tax purposes,
+in such Class A Ordinary Shares, each amount determined in U.S. dollars. Any capital gain or loss will be long-term capital gain or loss
+if the Class A Ordinary Shares have been held for more than one year and will generally be United States source gain or loss for United
+States foreign tax credit purposes. The deductibility of a capital loss may be subject to limitations, particularly with regard to shareholders
+who are individuals. Each U.S. Holder is advised to consult its tax advisor regarding the tax consequences if a foreign tax is imposed
+on a disposition of our Class A Ordinary Shares, including the availability of the foreign tax credit under its particular circumstances.
+
+ 
+
+A
+U.S. Holder that receives Hong Kong dollars or another currency other than U.S. dollars on the disposition of our Class A Ordinary Shares
+will realize an amount equal to the U.S. dollar value of the non-U.S. currency received at the spot rate on the date of sale (or,
+if the Class A Ordinary Shares are traded on a recognized exchange and in the case of cash basis and electing accrual basis U.S. Holders,
+the settlement date). An accrual basis U.S. Holder that does not elect to determine the amount realized using the spot rate on the settlement
+date will recognize foreign currency gain or loss equal to the difference between the U.S. dollar value of the amount received based
+on the spot market exchange rates in effect on the date of sale or other disposition and the settlement date. A U.S. Holder will have
+a tax basis in the currency received equal to the U.S. dollar value of the currency received on the settlement date. Any gain or loss
+on a subsequent disposition or conversion of the currency will be United States source ordinary income or loss.
+
+ 
+
+Passive
+Foreign Investment Company Considerations
+
+ 
+
+For
+United States federal income tax purposes, a non-United States corporation, such as our Company, will be treated as a "passive
+foreign investment company," or "PFIC" if, in the case of any particular taxable year, either (a) 75% or more of our
+gross income for such year consists of certain types of "passive" income or (b) 50% or more of the value of our assets (generally
+determined on the basis of a quarterly average) during such year produce or are held for the production of passive income. Based upon
+our current and expected income and assets (including goodwill and taking into account the expected proceeds from this offering) and
+the expected market price of our Class A Ordinary Shares following this offering, we do not expect to be a PFIC for the current taxable
+year or the foreseeable future.
+
+ 
+
+However,
+while we do not expect to be or become a PFIC, no assurance can be given in this regard because the determination of whether we are or
+will become a PFIC for any taxable year is a fact-intensive inquiry made annually that depends, in part, upon the composition and classification
+of our income and assets. Fluctuations in the market price of our Class A Ordinary Shares may cause us to be or become a PFIC for the
+current or subsequent taxable years because the value of our assets for the purpose of the asset test, including the value of our goodwill
+and other unbooked intangibles, may be determined by reference to the market price of our Class A Ordinary Shares (which may be volatile).
+The composition of our income and assets may also be affected by how, and how quickly, we use our liquid assets and the cash raised in
+this offering. It is also possible that the Internal Revenue Service may challenge our classification of certain income or assets for
+purposes of the analysis set forth in subparagraphs (a) and (b), above or the valuation of our goodwill and other unbooked intangibles,
+which may result in our company being or becoming a PFIC for the current or future taxable years.
+
+ 
+
+ -137-
+
+ 
+
+ 
+
+ 
+
+If
+we are classified as a PFIC for any taxable year during which a U.S. Holder holds our Class A Ordinary Shares, and unless the U.S. Holder
+makes a mark-to-market election (as described below), the U.S. Holder will generally be subject to special tax rules on (i) any excess
+distribution that we make to the U.S. Holder (which generally means any distribution paid during a taxable year to a U.S. Holder that
+is greater than 125% of the average annual distributions paid in the three preceding taxable years or, if shorter, the U.S. Holder s
+holding period for the Class A Ordinary Shares), and (ii) any gain realized on the sale or other disposition, including, under certain
+circumstances, a pledge, of Class A Ordinary Shares. Under the PFIC rules:
+
+ 
+
+ 
+ 
+ such
+ excess distribution and/or gain will be allocated ratably over the U.S. Holder s holding period for the Class A Ordinary Shares;
+
+ 
+ 
+ 
+
+ 
+ 
+ such
+ amount allocated to the current taxable year and any taxable years in the U.S. Holder s holding period prior to the first taxable
+ year in which we are a PFIC, each a pre-PFIC year, will be taxable as ordinary income;
+
+ 
+ 
+ 
+
+ 
+ 
+ such
+ amount allocated to each prior taxable year, other than a pre-PFIC year, will be subject to tax at the highest tax rate in effect
+ applicable to the U.S. Holder for that year; and
+
+ 
+ 
+ 
+
+ 
+ 
+ an
+ interest charge generally applicable to underpayments of tax will be imposed on the tax attributable to each prior taxable year,
+ other than a pre-PFIC year.
+
+ 
+ 
+
+If
+we are a PFIC for any taxable year during which a U.S. Holder holds our Class A Ordinary Shares and we own any equity in a non- United
+States entity that is also a PFIC, or a lower-tier PFIC, such U.S. Holder would be treated as owning a proportionate amount (by value)
+of the shares of the lower-tier PFIC for purposes of the application of these rules. U.S. Holders are advised to consult their tax advisors
+regarding the application of the PFIC rules to any of the entities in which we may own equity.
+
+ 
+
+As
+an alternative to the foregoing rules, a U.S. Holder of "marketable stock" in a PFIC may make a mark-to-market election with
+respect to such stock, provided that certain requirements are met. The mark-to-market election is available only for stock that is regularly
+traded on a national securities exchange that is registered with the SEC, or on a foreign exchange or market that the IRS determines
+is a qualified exchange that has rules sufficient to ensure that the market price represents a legitimate and sound fair market value.
+Although we intend to apply for the listing of our Class A Ordinary Shares on the Nasdaq, we cannot guarantee that our listing will be
+approved. Furthermore, we cannot guarantee that, once listed, our Class A Ordinary Shares will continue to be listed and regularly traded
+on such exchange. U.S. Holders are advised to consult their tax advisors as to whether the Class A Ordinary Shares are considered marketable
+for these purposes.
+
+ 
+
+If
+an effective mark-to-market election is made with respect to our Class A Ordinary Shares, the U.S. Holder will generally (i) include as
+ordinary income for each taxable year that we are a PFIC the excess, if any, of the fair market value of Class A Ordinary Shares held
+at the end of the taxable year over its adjusted tax basis of such Class A Ordinary Shares and (ii) deduct as an ordinary loss the excess,
+if any, of its adjusted tax basis of the Class A Ordinary Shares held at the end of the taxable year over the fair market value of such
+Class A Ordinary Shares held at the end of the taxable year, but only to the extent of the net amount previously included in income as
+a result of the mark-to-market election. The U.S. Holder s adjusted tax basis in the Class A Ordinary Shares would be adjusted to
+reflect any income or loss resulting from the mark-to-market election. If a U.S. Holder makes an effective mark-to-market election, in
+each year that we are a PFIC any gain recognized upon the sale or other disposition of the Class A Ordinary Shares will be treated as
+ordinary income and loss will be treated as ordinary loss, but only to the extent of the net amount previously included in income as
+a result of the mark-to-market election.
+
+ 
+
+If
+a U.S. Holder makes a mark-to-market election in respect of a PFIC and such corporation ceases to be a PFIC, the U.S. Holder will not
+be required to take into account the mark-to-market gain or loss described above during any period that such corporation is not a PFIC.
+
+ 
+
+Because
+a mark-to-market election generally cannot be made for any lower-tier PFICs that a PFIC may own, a U.S. Holder who makes a mark-to-market
+election with respect to our Class A Ordinary Shares may continue to be subject to the general PFIC rules with respect to such U.S. Holder s
+indirect interest in any of our non-United States subsidiaries if any of them is a PFIC.
+
+ 
+
+If
+a U.S. Holder owns our Class A Ordinary Shares during any taxable year that we are a PFIC, such holder would generally be required to
+file an annual IRS Form 8621. Each U.S. Holder is advised to consult its tax advisor regarding the potential tax consequences to such
+holder if we are or become a PFIC, including the possibility of making a mark-to-market election.
+
+ 
+
+THE
+DISCUSSION ABOVE IS A GENERAL SUMMARY. IT DOES NOT COVER ALL TAX MATTERS THAT MAY BE OF IMPORTANCE TO A PARTICULAR INVESTOR. EACH
+PROSPECTIVE INVESTOR IN OUR CLASS A ORDINARY SHARES IS URGED TO CONSULT ITS OWN TAX ADVISER ABOUT THE TAX CONSEQUENCES TO IT
+OF OWNING AND DISPOSING OF OUR CLASS A ORDINARY SHARES IN LIGHT OF SUCH PROSPECTIVE INVESTOR S OWN
+CIRCUMSTANCES.
+
+ 
+
+ -138-
+
+ 
+
+ 
+
+ 
+
+ENFORCEABILITY
+OF CIVIL LIABILITIES
+
+ 
+
+Our
+Company is an exempted company incorporated with limited liability under the laws of the Cayman Islands. We are incorporated in the Cayman
+Islands because of certain benefits associated with being a Cayman Islands company, such as political and economic stability, an effective
+judicial system, a favorable tax system, the absence of foreign exchange control or currency restrictions and the availability of professional
+and support services. However, the Cayman Islands has a less developed body of securities laws as compared to the United States and provides
+less protection for investors. In addition, investor may not have standing to sue Cayman Islands companies before the U.S. federal courts.
+
+ 
+
+All
+of our current operations are conducted outside of the United States and all of our current assets are located outside of the United
+States, with the majority of our operations and current assets being located in Hong Kong. All of the directors and executive officers
+of our Company and the auditors of our Company reside outside the United States and substantially all of their assets are located outside
+the United States. As a result, it may not be possible for investors to effect service of process within the United States upon us or
+any such persons, or to enforce in the United States any judgment obtained in the U.S. courts against us or any of such persons, including
+judgments based upon the civil liability provisions of the U.S. securities laws or any U.S. state or territory.
+
+ 
+
+We
+have appointed Cogency Global Inc., 122 East 42nd Street, 18th Floor, New York, NY 10168, as our
+agent upon whom process may be served in any action brought against us under the securities laws of the United States.
+
+ 
+
+Cayman
+Islands
+
+ 
+
+Conyers
+Dill & Pearman, our counsel as to Cayman Islands law, has advised us that although there is no statutory enforcement in the Cayman
+Islands of judgments obtained in the federal or state courts of the United States (and the Cayman Islands are not a party to any treaties
+for the reciprocal enforcement or recognition of such judgments). The courts of the Cayman Islands would recognize as a valid
+judgment, a final and conclusive judgment in personam obtained in the courts of the United States against the Company under which a sum
+of money is payable (other than a sum of money payable in respect of multiple damages, taxes or other charges of a like nature or in
+respect of a fine or other penalty) and would give a judgment based thereon provided that (a) such courts had proper jurisdiction over
+the parties subject to such judgment; (b) such courts did not contravene the rules of natural justice of the Cayman Islands; (c) such
+judgment was not obtained by fraud; (d) the enforcement of the judgment would not be contrary to the public policy of the Cayman Islands;
+(e) no new admissible evidence relevant to the action is submitted prior to the rendering of the judgment by the courts of the Cayman
+Islands; and (f) there is due compliance with the correct procedures under the laws of the Cayman Islands. The Cayman Islands courts
+are unlikely to enforce a judgment obtained from the Foreign Court under civil liability provisions of U.S. federal securities law if
+such a judgment is found by the courts of the Cayman Islands to give rise to obligations to make payments that are penal or punitive
+in nature. Such a determination has not yet been made by the Grand Court of the Cayman Islands. A Cayman Islands court may stay enforcement
+proceedings if concurrent proceedings are being brought elsewhere.
+
+ 
+
+ -139-
+
+ 
+
+ 
+
+ 
+
+Hong
+Kong
+
+ 
+
+Robertsons,
+our counsel as to Hong Kong law, has advised us that there is currently no arrangement providing for the reciprocal enforcement of judgements
+between Hong Kong and the United States, as such judgments of United States courts will not be directly enforced in Hong Kong. However,
+under common law, a foreign judgment (including one from federal or state court in the United States) obtained against the Company may
+generally be treated by the courts of Hong Kong as a cause of action in itself and sued upon as a debt between the parties. In a common
+law action for enforcement of a foreign judgment, the judgment creditor has to prove that (a) the judgment is in personam; (b)
+the judgment is in the nature of a monetary award; (c) the judgment is final and conclusive on the merits and has not been stayed or
+satisfied in full; and (d) the judgement is from a court of competent jurisdiction. The defenses available to the defendant in a common
+law action for enforcement of a foreign judgment include breach of natural justice, fraud and contrary to public policy of Hong Kong.
+In order to enforce the foreign judgement at common law, fresh proceedings must be initiated in Hong Kong, which involves issuing a Writ
+of Summons and Statement of Claim attaching the foreign judgment as proof of the debt.
+
+ 
+
+There
+is uncertainty as to whether the courts of Hong Kong would: (i) recognize or enforce judgments of United States courts obtained against
+us or our directors or officers predicated upon the civil liability provisions of the securities laws of the United States or any state
+in the United States; or (ii) entertain original actions brought in Hong Kong against us or our directors or officers predicated upon
+the securities laws of the United States or any state in the United States. Following the completion of this offering, our Board
+will be comprised of five directors, with all directors located in Hong Kong. The current directors
+are Ms. Seto and Ms. Tse.
+
+ 
+
+A
+judgment of a court in the United States predicated upon U.S. federal or state securities laws may be enforced in Hong Kong at common
+law by bringing an action in a Hong Kong court on that judgment for the amount due thereunder, and then seeking summary judgment on the
+strength of the foreign judgment, provided that the foreign judgment, among other things, is: (i) for a debt or a definite sum of money
+(not being taxes or similar charges to a foreign government taxing authority or a fine or other penalty); and (ii) final and conclusive
+on the merits of the claim, but not otherwise. Such a judgment may not, in any event, be so enforced in Hong Kong if (a) it was obtained
+by fraud; (b) the proceedings in which the judgment was obtained were opposed to natural justice; (c) its enforcement or recognition
+would be contrary to the public policy of Hong Kong; (d) the court of the United States was not jurisdictionally competent; or (e) the
+judgment was in conflict with a prior Hong Kong judgment.
+
+ 
+
+Hong
+Kong has no arrangement for the reciprocal enforcement of judgments with the United States. As a result, there is uncertainty as to the
+enforceability in Hong Kong, in original actions or in actions for enforcement, of judgments of United States courts of civil liabilities
+predicated solely upon the federal securities laws of the United States or the securities laws of any State or territory within the United
+States.
+
+ 
+
+ -140-
+
+ 
+
+ 
+
+ 
+
+UNDERWRITING
+
+ 
+
+We
+and the Selling Shareholder have entered into an underwriting agreement dated ,
+2025 with Bancroft Capital, LLC, or the Representative or Bancroft, acting as the lead managing underwriter and book-runner with respect
+to the Class A Ordinary Shares subject to this offering. Subject to the terms and conditions of the underwriting agreement, we and the
+Selling Shareholder have agreed to sell to the underwriters, and the underwriters have agreed to purchase from us, on a firm commitment
+basis, the number of Class A Ordinary Shares set forth opposite their name(s) below, at the public offering price, less the underwriting
+discount set forth on the cover page of this prospectus:
+
+ 
+
+ 
+ Name 
+ Number
+ of shares 
+
+ 
+ Bancroft Capital, LLC 
+ 
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+
+ 
+ Total 
+ 2,000,000 
+
+ 
+
+ 
+
+The underwriter is offering
+the Class A Ordinary Shares subject to their acceptance of the Class A Ordinary Shares from us and subject to prior sale. The underwriting
+agreement provides that the obligations of the underwriter to pay for and accept delivery of the Class A Ordinary Shares offered by this
+prospectus are subject to the approval of certain legal matters by their counsel and to certain other conditions. The underwriter is
+obligated to take and pay for all of the Class A Ordinary Shares offered by this prospectus if any such shares are taken.
+
+ 
+
+The
+Representative has advised us that it proposes to offer the shares to the public at the public offering price set forth on the cover
+page of this prospectus and to certain dealers at that price less a concession not in excess of US$ 
+per share. The underwriter may allow, and certain dealers may re-allow, a discount from the concession not in excess of US$ 
+per share to certain brokers and dealers. After this offering, the public offering price, concession and reallowance to dealers may be
+reduced by the Representative. No such reduction shall change the amount of proceeds to be received by us as set forth on the cover page
+of this prospectus. The securities are offered by the underwriter as stated herein, subject to receipt and acceptance by them and subject
+to their right to reject any order in whole or in part. The underwriter has informed us that they do not intend to confirm sales to any
+accounts over which they exercise discretionary authority.
+
+ 
+
+Discounts,
+Commission and Expenses
+
+ 
+
+The
+underwriting discount is equal to the initial public offering price per share, less the amount paid by the underwriters to us per share.
+The underwriting discounts is 7.0% of the initial public offering price. The underwriting discount was determined through an arms 
+length negotiation between us and the underwriters.
+
+ 
+
+The
+following table shows the price per share and total public offering price, underwriting discounts and commissions, and proceeds before
+expenses to us.
+
+ 
+
+ 
+ 
+ Per
+ Share 
+ Total
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Public
+ offering price 
+ US$ 
+ US$ (3)
+
+ 
+ Underwriting discounts and commissions paid by us(1)(2) 
+ US$ 
+ US$ 
+
+ 
+ Proceeds
+ to us, before expenses(2) 
+ US$ 
+ US$ 
+
+ 
+ Proceeds
+ to the Selling Shareholder before expenses(2) 
+ US$ 
+ US$ 
+
+ 
+
+ 
+
+ 
+ (1)
+ Represents
+ underwriting discount and commissions equal to 7.0% per share, which is the underwriting discount we have agreed to pay on such shares
+ sold to investors in this offering.
+
+ 
+ 
+
+ -141-
+
+ 
+
+ 
+
+ 
+
+ 
+ (2)
+ Excludes
+ fees and expenses payable to the underwriter.
+
+ 
+ 
+ 
+
+ 
+ (3)
+ Includes US$6,030,000 gross proceeds from the sale
+ of 1,340,000 Class A Ordinary Shares offered by our Company and US$2,970,000 gross proceeds from the sale of 660,000
+ in aggregate Class A Ordinary Shares offered by the Selling Shareholder, based on an assumed price to the public in this offering
+ of US$4.50 per Class A Ordinary Share (being the midpoint of the range set forth on the cover of this prospectus), and in each
+ case before payment of underwriting discounts and commissions and offering expenses.
+
+ 
+ 
+
+We
+have agreed to reimburse the Representative up to a maximum of US$190,000 for certain out-of-pocket accountable expenses (including the
+legal counsel fees, roadshow expenses, cost of background checks and other disbursements, as disclosed below), and up to an additional
+US$12,900 for out-of-pocket clearing agent settlement and closing costs. We have paid a US$35,000 advance towards the Representative s
+legal counsel fees and will pay another US$35,000 advance prior to the completion of this offering. Any portion of the advance will be
+returned to us to the extent the Representative s out-of-pocket accountable expenses are not actually incurred in accordance with
+FINRA Rule 5110(g)(4)(A).
+
+ 
+
+We
+have agreed to pay expenses relating to the offering, including but not limited to (i) all expenses incident to the authorization,
+issuance, sale, preparation and delivery of the Class A Ordinary Shares to be sold in this offering, (ii) all fees and
+expenses of the Company s legal counsel, independent public or certified public accountants and other advisors, (iii) all fees
+related to the registration of the Class A Ordinary Shares to be sold in this offering with the SEC and the listing of the Class
+A Ordinary Shares on the Nasdaq Capital Market, (iv) all costs and expenses incurred in connection with the shipping and
+distribution of underwriting documents, registration statements, prospectuses and all amendments, supplements and exhibits thereto
+as may, in each case, be reasonably requested by the Representative for use in connection with the offering and/or sale of the Class
+A Ordinary Shares to be sold in this offering, (v) all fees and expenses incurred in connection with qualifying or registering
+such Class A Ordinary Shares for offer and sale under the "blue sky" securities laws of such states and other
+jurisdictions as the Representative may request (including all filing and registration fees and the reasonable fees and
+disbursements of Representative s counsel), (vi) all out-of-pocket accountable fees, expenses and disbursements incurred by
+the Representative in connection with the offer, sale or marketing of the Class A Ordinary Shares and performance of the
+Representative s obligations under the underwriting agreement, including without limitation fees and disbursements of the
+Representative s counsel and travel and related expenses of the Representative, which reimbursable accountable amount
+(excluding expenses related to blue sky and FINRA compliance), (vii) all expenses incurred by the Company in connection with any
+"road show" presentation to potential investors, (viii) the costs and charges of the transfer agent and the registrar
+for the Class A Ordinary Shares, and (ix) all application fees and fees and expenses of counsel to the Representative
+incurred in connection with the filing with and clearance of the offering by FINRA.
+
+ 
+
+We
+have agreed to pay to the underwriters, by deduction from the net proceeds of the offering contemplated herein, a non-accountable expense
+allowance equal to one percent (1%) of the gross proceeds received by us from the sale of the Class A Ordinary Shares in this offering.
+
+ 
+
+We
+estimate that the total expenses of the offering payable by us, excluding the underwriters discount and commissions and non-accountable
+expense allowance will be approximately US$1.07 million, which includes reimbursement of the Representative s accountable
+expenses and clearing agent settlement and closing costs discussed above.
+
+ 
+
+Lock-Up
+Agreements
+
+ 
+
+We, our directors and executive
+officers and our 5.0% or greater shareholders, have agreed with the underwriter, for a period of 180 days from the closing of this offering,
+subject to certain exceptions not to (i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any
+option or contract to sell, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly,
+any Class A Ordinary Shares or any securities convertible into or exercisable or exchangeable for Class A Ordinary Shares; (ii) file or
+caused to be filed any registration statement with the SEC relating to the offering of any Class A Ordinary Shares or any securities convertible
+into or exercisable or exchangeable for Class A Ordinary Shares; (iii) complete any offering of debt securities of the Company, other
+than entering into a line of credit with a traditional bank or (iv) enter into any swap or other arrangement that transfers to another,
+in whole or in part, any of the economic consequences of ownership of Class A Ordinary Shares or any such other securities, whether any
+such transaction described in clause (i), (ii), (iii) or (iv) above is to be settled by delivery of Class A Ordinary Shares or such other
+securities, in cash or otherwise. These lock-up restrictions, however, do not apply to the Class A Ordinary Shares sold by the Selling Shareholder in this offering. This means that, for a period of 180 days following the closing of the offering, persons subject to
+the lock-up restrictions may not offer, sell, pledge or otherwise dispose of these securities without the prior written consent of the
+Representative.
+
+ 
+
+The
+Representative has no present intention to waive or shorten the lock-up period; however, the terms of the lock-up agreements may be waived
+at its discretion. In determining whether to waive the terms of the lock-up agreements, the Representative may base its decision on its
+assessment of the relative strengths of the securities markets and companies similar to ours in general, and the trading pattern of,
+and demand for, our securities in general.
+
+ 
+
+Right
+of First Refusal
+
+ 
+
+We
+have also granted the Representative a right of first refusal for a period of twelve months after the date this offering is completed,
+if we or any of our subsidiaries decide to raise funds in the United States by means of a public offering (including at-the-market facility)
+or a private placement or any other capital-raising financing of equity, equity-linked or debt securities using an underwriter or placement
+agent, to act as sole underwriter, sole book-runner and/or sole placement agent for such financing during such twelve month period, of
+us or any successor to or any subsidiary of us, on terms customary terms to the Representative (the "Right of First Refusal").
+The Right of First Refusal is subject to FINRA Rule 5110(g)(5), and we shall have a right of termination for cause, which
+includes that we may terminate the Representative s engagement upon the Representative s material failure to provide the
+underwriting services required by the underwriting agreement. Our exercise of the right of termination for cause will eliminate any obligations
+with respect to the Right of First Refusal.
+
+ 
+
+Tail
+Period
+
+ 
+
+The
+Representative shall be entitled to cash compensation equal to seven percent (7.0%) of the gross proceeds received by us from any public
+or private offering or other financing or capital raising transaction of any kind, or Tail Financing, to the extent that such financing
+or capital is provided to us by any of the investors introduced to us by the Representative, or the Tail Investors, if such Tail Financing
+is consummated at any time within the 12-month period from the closing of this offering. The right to receive a fee in connection with
+the Tail Financing shall be subject to FINRA Rule 5110(g)(5), and we shall have a right of termination for cause, which includes that
+we may terminate the Representative s engagement upon the Representative s material failure to provide the underwriting services
+required by the underwriting agreement. Our exercise of the right of termination for cause will eliminate any obligations with respect
+to the payment of any termination fee or provision of any Tail Financing fee, including the Tail Financing set forth above.
+
+ 
+
+ -142-
+
+ 
+
+ 
+
+ 
+
+Indemnification
+
+ 
+
+We
+have agreed to indemnify the underwriter against certain liabilities, including liabilities under the Securities Act and liabilities
+arising from breaches of representations and warranties contained in the underwriting agreement, or to contribute to payments that the
+underwriter may be required to make in respect of those liabilities.
+
+ 
+
+Nasdaq
+Listing
+
+ 
+
+We
+intend to apply to list our Class A Ordinary Shares on the Nasdaq under the symbol "TDIC. We make no representation that
+such application will be approved or that our Class A Ordinary Shares will trade on such market either now or at any time in the future;
+notwithstanding the foregoing, we will not close this offering unless such Class A Ordinary Shares will be listed on the Nasdaq at the
+completion of this offering.
+
+ 
+
+Electronic
+Offer, Sale, and Distribution of Securities
+
+ 
+
+A
+prospectus in electronic format may be made available on the websites maintained by one or more of the underwriters or selling group
+members. The underwriter may agree to allocate a number of shares to underwriters and selling group members for sale to their online
+brokerage account holders. Internet distributions will be allocated by the underwriters and selling group members that will make internet
+distributions on the same basis as other allocations. Other than the prospectus in electronic format, the information on these websites
+is not part of, nor incorporated by reference into, this prospectus or the Registration Statement of which this prospectus forms a part,
+has not been approved or endorsed by us or the Representative in its capacity as the underwriter, and should not be relied upon by investors.
+
+ 
+
+Any
+underwriter who is a qualified market maker on the Nasdaq may engage in passive market making transactions on the Nasdaq in accordance
+with Rule 103 of Regulation M, during the business day prior to the pricing of the offering, before the commencement
+of offers or sales. Passive market makers must comply with applicable volume and price limitations and must be identified as passive
+market makers. In general, a passive market maker must display its bid at a price not in excess of the highest independent bid for such
+security; if all independent bids are lowered below the passive market maker s bid, however, the passive market maker s bid
+must then be lowered when certain purchase limits are exceeded.
+
+ 
+
+No
+Prior Public Market
+
+ 
+
+Prior
+to this offering, there has been no public market for our securities and the public offering price for our Class A Ordinary Shares will
+be determined through negotiations between us and the Representative. Among the factors to be considered in these negotiations will be
+prevailing market conditions, our financial information, market valuations of other companies that we and the Representative believe
+to be comparable to us, estimates of our business potential, the present state of our development and other factors deemed relevant.
+The offering price for our Class A Ordinary Shares in this offering has been arbitrarily determined by the Company in its negotiations
+with the underwriter and does not necessarily bear any direct relationship to the assets, operations, book or other established criteria
+of value of the Company.
+
+ 
+
+ -143-
+
+ 
+
+ 
+
+ 
+
+Price
+Stabilization, Short Positions and Penalty Bids
+
+ 
+
+Until
+the distribution of the Class A Ordinary Shares offered by this prospectus is completed, rules of the SEC may limit the ability of the
+underwriter to bid for and to purchase our Class A Ordinary Shares. As an exception to these rules, the underwriter may engage in transactions
+effected in accordance with Regulation M under the Exchange Act that are intended to stabilize, maintain or otherwise affect the price
+of our Class A Ordinary Shares. The underwriter may engage in syndicate covering transactions, stabilizing transactions and penalty bids
+in accordance with Regulation M.
+
+ 
+
+ 
+ 
+ Stabilizing transactions consist of bids or purchases made by the managing underwriter for the purpose
+ of preventing or slowing a decline in the market price of our securities while this offering is in progress.
+
+ 
+ 
+ 
+
+ 
+ 
+ Short sales occur when the managing underwriter, on behalf of the underwriting
+ syndicate, sells more of our shares than they purchase from us in this offering. In order to cover the resulting short position, the
+ managing underwriter may engage in syndicate covering transactions. There is no contractual limit on the size of any syndicate covering
+ transaction. The underwriter will deliver a prospectus in connection with any such short sales. Purchasers of shares sold short by
+ the underwriter are entitled to the same remedies under the federal securities laws as any other purchaser of units covered by the
+ registration statement.
+
+ 
+ 
+ 
+
+ 
+ 
+ Syndicate covering transactions are bids for or purchases of our securities on the open market by
+ the managing underwriter on behalf of the underwriters in order to reduce a short position incurred by the managing underwriter on
+ behalf of the underwriters.
+
+ 
+ 
+ 
+
+ 
+ 
+ A penalty bid is an arrangement permitting the managing underwriter
+ to reclaim the selling concession that would otherwise accrue to an underwriter if the Class A Ordinary Shares originally sold by the
+ underwriter were later repurchased by the managing underwriter and therefore was not effectively sold to the public by such underwriter.
+
+ 
+
+Stabilization,
+syndicate covering transactions and penalty bids may have the effect of raising or maintaining the market price of our Class A
+Ordinary Shares or preventing or retarding a decline in the market price of our Class A Ordinary Shares. As a result, the price
+of our Class A Ordinary Shares may be higher than the price that might otherwise exist in the open market.
+
+ 
+
+Neither
+we nor the Selling Shareholder nor the underwriter make any representation or prediction as to the effect that the transactions
+described above may have on the prices of our Class A Ordinary Shares. These transactions may occur on the Nasdaq or on any trading market.
+If any of these transactions are commenced, they may be discontinued without notice at any time.
+
+ 
+
+Other
+Activities and Relationships
+
+ 
+
+The
+underwriter and certain of their affiliates are full service financial institutions engaged in various activities, which may include
+securities trading, commercial and investment banking, financial advisory, investment management, investment research, principal investment,
+hedging, financing and brokerage activities. Some of the underwriter and certain of their affiliates may in the future engage in investment
+banking and other commercial dealings in the ordinary course of business with us and our affiliates, for which they may in the future
+receive customary fees, commissions and expenses.
+
+ 
+
+In
+addition, in the ordinary course of their business activities, the underwriter and its affiliates may make or hold a broad array of investments
+and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for
+their own account and for the accounts of their customers. Such investments and securities activities may involve securities and/or instruments
+of ours or our affiliates. The underwriter and its affiliates may also make investment recommendations and/or publish or express independent
+research views in respect of such securities or financial instruments and may hold, or recommend to customers that they acquire, long
+and/or short positions in such securities and instruments.
+
+ 
+
+Offers
+Outside the United States
+
+ 
+
+Other
+than in the United States, no action has been taken by us or the underwriter that would permit a public offering of the Class A Ordinary Shares
+offered by this prospectus in any jurisdiction where action for that purpose is required. The Class A Ordinary Shares offered by this
+prospectus may not be offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements
+in connection with the offer and sale of any such shares be distributed or published in any jurisdiction, except under circumstances
+that will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus
+comes are advised to inform themselves about and to observe any restrictions relating to the offering and the distribution of this prospectus.
+This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any Class A Ordinary Shares offered by this
+prospectus in any jurisdiction in which such an offer or a solicitation is unlawful.
+
+ 
+
+ -144-
+
+ 
+
+ 
+
+ 
+
+EXPENSES
+RELATED TO THIS OFFERING
+
+ 
+
+Set
+forth below is an itemization of the total expenses, excluding underwriting discounts, which are expected to be incurred by us in connection
+with the offer and sale of the Class A Ordinary Shares by us and the Selling Shareholder. With the exception of the SEC registration
+fee, the FINRA filing fee and the Nasdaq entry and listing fee, all amounts are estimates.
+
+ 
+
+ 
+ SEC Registration Fee
+ 
+ US$
+ 5,678
+ 
+
+ 
+ FINRA Filing Fee
+ 
+ US$
+ 6,063
+ 
+
+ 
+ Nasdaq Listing Fee
+ 
+ US$
+ 5,000
+ 
+
+ 
+ Printing and engraving expenses
+ 
+ US$
+ 6,995
+ 
+
+ 
+ Legal fees and expenses
+ 
+ US$
+ 506,944
+ 
+
+ 
+ Accounting fees and expenses
+ 
+ US$
+ 283,211
+ 
+
+ 
+ Miscellaneous
+ 
+ US$
+ 258,021
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Total
+ 
+ US$
+ 1,071,911
+ 
+
+ 
+
+ 
+
+These
+expenses will be borne by us.
+
+ 
+
+ -145-
+
+ 
+
+ 
+
+ 
+
+LEGAL
+MATTERS
+
+ 
+
+We
+are being represented by Morgan, Lewis & Bockius with respect to certain legal matters of U.S. federal securities. The validity of
+the Class A Ordinary Shares offered in this offering and certain legal matters as to Cayman Islands law will be passed upon for us by
+Conyers Dill & Pearman. Legal matters as to Hong Kong law will be passed upon for us by Robertsons and legal matters as to the PRC
+will be passed upon for us by Guangdong Wesley Law Firm. Nelson Mullins Riley & Scarborough LLP, Raleigh, North Carolina, is acting
+as U.S. counsel for the underwriters.
+
+ 
+
+ -146-
+
+ 
+
+ 
+
+ 
+
+EXPERTS
+
+ 
+
+The
+financial statements as of March 31, 2023 and 2024, and for each of the two years in the period ended March 31, 2023 and 2024, included
+in this prospectus have been audited by TAAD LLP, an independent registered public accounting firm, as stated in their report appearing
+herein (which report expresses an unqualified opinion on the financial statements). Such financial statements have been so included in
+reliance upon the report of such firm given upon the authority of such firm as experts in accounting and auditing. The office of TAAD
+LLP is located at 20955 Pathfinder Road, Suite 370, Diamond Bar, CA 91765, USA.
+
+ 
+
+ -147-
+
+ 
+
+ 
+
+ 
+
+WHERE
+YOU CAN FIND MORE INFORMATION
+
+ 
+
+We
+have filed a registration statement on Form F-1, including relevant exhibits, with the SEC on Form F-1 under the Securities Act with
+respect to the underlying Class A Ordinary Shares to be sold in this offering. For the purposes of this section, the term "Registration
+Statement" means the original registration statement and any and all amendments thereto including the schedules and exhibits to
+the original registration statement or any amendment. This prospectus, which constitutes a part of the Registration Statement on Form
+F-1, does not contain all of the information contained in the Registration Statement. You should read our Registration Statements and
+their exhibits and schedules for further information with respect to us and our Class A Ordinary Shares.
+
+ 
+
+Immediately
+upon the effectiveness of the Registration Statement on Form F-1 of which this prospectus forms a part, we will become subject to periodic
+reporting and other informational requirements of the Exchange Act as applicable to foreign private issuers. Accordingly, we will be
+required to file reports, including annual reports on Form 20-F, and other information with the SEC. All information filed with the SEC,
+including the Registration Statement, can be obtained over the Internet at the SEC s website at www.sec.gov. You can request copies
+of documents, upon payment of a duplicating fee, by writing to the SEC.
+
+ 
+
+As
+a foreign private issuer, we are exempt under the Exchange Act from, among other things, the rules prescribing the furnishing and content
+of proxy statements, and our executive officers, directors and principal shareholders are exempt from the reporting and short-swing profit
+recovery provisions contained in Section 16 of the Exchange Act. In addition, we will not be required under the Exchange Act to file
+periodic reports and financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are registered
+under the Exchange Act. As we are a foreign private issuer, we will be required to file our annual report on Form 20-F within 120 days
+of the end of each year. However, we intend to furnish the depositary with our annual reports, which will include a review of operations
+and annual audited consolidated financial statements prepared in conformity with U.S. GAAP, and all notices of shareholders 
+meetings and other reports and communications that are made generally available to our shareholders.
+
+ 
+
+ -148-
+
+ 
+
+ 
+
+ 
+
+DREAMLAND
+LIMITED AND SUBSIDIARIES
+
+ 
+
+INDEX
+TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
+
+ 
+
+ 
+ 
+ Page
+
+ 
+ 
+ 
+
+ 
+ Unaudited
+ Consolidated Balance Sheets as of March 31, 2024 and September 30, 2024
+ F-2
+
+ 
+ 
+ 
+
+ 
+ Unaudited
+ Consolidated Statements of Operations for the Six Months ended September 30, 2023 and 2024
+ F-3
+
+ 
+ 
+ 
+
+ 
+ Unaudited
+ Consolidated Statements of Changes in Shareholders Equity for the Six Months ended September 30, 2024
+ F-4
+
+ 
+ 
+ 
+
+ 
+ Unaudited
+ Consolidated Statements of Cash Flows for the Six Months ended September 30, 2023 and 2024
+ F-5
+
+ 
+ 
+ 
+
+ 
+ Notes
+ to Unaudited Consolidated Financial Statements
+ F-6
+ to F-27
+
+ 
+ 
+
+ F-1
+
+ 
+
+ 
+
+ 
+
+DREAMLAND
+LIMITED AND SUBSIDIARIES
+
+UNAUDITED
+CONSOLIDATED BALANCE SHEETS
+
+ 
+
+ 
+ 
+ 
+ As of 
+ As of 
+
+ 
+ 
+ Note 
+ March 31, 
+2024 
+ September 30, 
+2024 
+
+ 
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ ASSETS 
+ 
+ 
+ 
+
+ 
+ Equipment, net 
+ 8 
+ 135,892 
+ 100,441 
+
+ 
+ Right-of-use assets 
+ 9 
+ 789,369 
+ 613,954 
+
+ 
+ Intangible assets, net 
+ 10 
+ - 
+ 3,053,333 
+
+ 
+ Non-current assets 
+ 
+ 925,261 
+ 3,767,728 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Current assets: 
+ 
+ 
+ 
+
+ 
+ Deposits, prepayments and other receivables 
+ 11 
+ 290,814 
+ 1,848,956 
+
+ 
+ Amount due from related parties 
+ 
+ - 
+ 2,133,521 
+
+ 
+ Amount due from a shareholder 
+ 18 
+ 2,950,434 
+ - 
+
+ 
+ Amount due from joint operation parties 
+ 12 
+ - 
+ 3,577,649 
+
+ 
+ Contract assets 
+ 6 
+ $4,337,713 
+ $7,121,031 
+
+ 
+ Inventory 
+ 13 
+ - 
+ 1,493,042 
+
+ 
+ Accounts receivable, net 
+ 7 
+ 826,687 
+ 7,041,845 
+
+ 
+ Cash and bank balances 
+ 
+ 3,817,083 
+ 1,363,152 
+
+ 
+ Total current assets 
+ 
+ 12,222,731 
+ 24,579,196 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL ASSETS 
+ 
+ $13,147,992 
+ $28,346,924 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Non-current liabilities: 
+ 
+ 
+ 
+
+ 
+ Bank borrowings 
+ 17 
+ 3,093,858 
+ 4,941,240 
+
+ 
+ Lease liabilities 
+ 9 
+ 601,853 
+ 364,374 
+
+ 
+ Total non-current liabilities 
+ 
+ 3,695,711 
+ 5,305,614 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Current liabilities: 
+ 
+ 
+ 
+
+ 
+ Bank borrowings, current portion 
+ 17 
+ $642,015 
+ $6,814,500 
+
+ 
+ Lease liabilities, current portion 
+ 9 
+ 178,001 
+ 543,055 
+
+ 
+ Tax payable 
+ 19 
+ 988,347 
+ 1,338,347 
+
+ 
+ Amount due to a shareholder 
+ 
+ - 
+ 47,054 
+
+ 
+ Amount due to joint operations parties 
+ 
+ - 
+ 1,926,881 
+
+ 
+ Contract liabilities 
+ 15 
+ 3,569,274 
+ 4,671,939 
+
+ 
+ Trade and other payables 
+ 14 
+ 1,573,583 
+ 2,486,934 
+
+ 
+ Total current liabilities 
+ 
+ 6,951,220 
+ 17,828,710 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL LIABILITIES 
+ 
+ $10,646,931 
+ $23,134,324 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ SHAREHOLDERS EQUITY 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Class A Ordinary Shares US$0.00001 par value authorized shares 9,500,000,000 shares as of March 31, 2024 and September
+ 30, 2024; 28,660,000 shares issued and outstanding as of March 31, 2024 and September 30, 2024* 
+ 18 
+ 2,233 
+ 2,233 
+
+ 
+ Class B Ordinary Shares US$0.00001 par value authorized shares 500,000,000 shares as of March 31, 2024 and September 30, 2024;
+ 1,000,000 shares issued and outstanding as of March 31, 2024 and September 30, 2024* 
+ 18 
+ 78
+ 
+ 78
+ 
+
+ 
+ Subscription receivables 
+ 18 
+ (3,974) 
+ (3,974)
+
+ 
+ Reserves 
+ 
+ 2,011,663 
+ 2,011,663 
+
+ 
+ Retained earnings 
+ 
+ 491,061 
+ 3,202,600 
+
+ 
+ TOTAL SHAREHOLDERS EQUITY 
+ 
+ $2,501,061 
+ $5,212,600 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL SHAREHOLDERS EQUITY AND LIABILITIES 
+ 
+ $13,147,992 
+ $28,346,924 
+
+ 
+
+ 
+
+*
+The shares amounts are presented on a retroactive basis.
+
+ 
+
+See
+accompanying notes to unaudited consolidated financial statements.
+
+ 
+
+ F-2
+
+ 
+
+ 
+
+ 
+
+DREAMLAND
+LIMITED AND SUBSIDIARIES
+
+UNAUDITED
+CONSOLIDATED STATEMENTS OF OPERATIONS
+
+ 
+
+ 
+ 
+ 
+ Six Months September 30, 
+
+ 
+ 
+ Note 
+ 2023 
+ 2024 
+
+ 
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Revenues 
+ 
+ $3,545,487 
+ $30,462,186 
+
+ 
+ Revenues, related party 
+ 
+ 227,588 
+ 552,166 
+
+ 
+ Total Revenues, net 
+ 3 
+ 3,773,075 
+ 31,014,352 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Costs and expenses: 
+ 
+ 
+ 
+
+ 
+ Cost of revenue 
+ 
+ (2,042,940) 
+ (19,736,299)
+
+ 
+ Cost of revenue – related party 
+ 
+ - 
+ (468,350)
+
+ 
+ 
+ 
+ (2,042,940) 
+ (20,204,649)
+
+ 
+ Selling, general and administrative expenses 
+ 5 
+ (72,454) 
+ (4,226,640)
+
+ 
+ Research and development 
+ 
+ - 
+ (660,000)
+
+ 
+ Amortization 
+ 
+ - 
+ (2,318,444)
+
+ 
+ Impairment of rights of use assets 
+ 
+ - 
+ (111,136)
+
+ 
+ Depreciation 
+ 
+ (149,906) 
+ (238,649)
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Profit from operations 
+ 
+ 1,507,775 
+ 3,254,834 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Other income/(expenses): 
+ 
+ 
+ 
+
+ 
+ Interest income 
+ 
+ 354 
+ 38,676 
+
+ 
+ Finance costs 
+ 
+ (129,176) 
+ (232,971)
+
+ 
+ Other income 
+ 
+ - 
+ 1,000 
+
+ 
+ Total other income/(expenses), net 
+ 4 
+ (128,822) 
+ (193,295)
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Profit before income taxes 
+ 
+ 1,378,953 
+ 3,061,539 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Income tax expense 
+ 19 
+ (23,000) 
+ (350,000)
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ NET PROFIT 
+ 
+ $1,355,953 
+ $2,711,539 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Profit per Class A Ordinary Share: 
+ 16 
+ 
+ 
+
+ 
+ - Basic* 
+ 
+ $0.047 
+ $0.095 
+
+ 
+ - Diluted* 
+ 
+ $0.046 
+ $0.091 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Weighted average number of Class A Ordinary Shares 
+ 
+ 
+ 
+
+ 
+ - Basic* 
+ 
+ 28,660,000 
+ 28,660,000 
+
+ 
+ - Diluted*
+
+ 
+ 
+ 29,660,000
+ 
+ 29,660,000
+ 
+
+ 
+ Weighted average number of Class B Ordinary Shares 
+ 
+ 
+ 
+
+ 
+ - Basic and diluted* 
+ 
+ 1,000,000
+ 
+ 1,000,000
+ 
+
+ 
+
+ 
+
+*
+The shares amounts are presented on a retroactive basis.
+
+ 
+
+See
+accompanying notes to unaudited consolidated financial statements.
+
+ 
+
+ F-3
+
+ 
+
+ 
+
+ 
+
+DREAMLAND
+LIMITED AND SUBSIDIARIES
+
+UNAUDITED
+CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS EQUITY
+
+ 
+
+ 
+ 
+ Class
+ A Ordinary Shares* 
+ Class
+ B Ordinary Shares* 
+ 
+ 
+ 
+ Total 
+
+ 
+ 
+ Number
+ of 
+shares 
+ Amount 
+ Number
+ of 
+shares 
+ Amount 
+ Subscription
+ Receivables 
+ Capital
+ Reserve 
+ Retained
+ Earnings 
+ shareholders 
+ Equity 
+
+ 
+ 
+ 
+ HKD 
+ 
+ HKD 
+ 
+ 
+ 
+ 
+
+ 
+ Balance as
+ of April 1, 2023 
+ 28,660,000 
+ $2,233 
+ 1,000,000 
+ $78 
+ $(3,974) 
+ $2,011,663 
+ $(1,097,813) 
+ $912,187 
+
+ 
+ Net
+ Profit 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ 1,355,953 
+ 1,355,953 
+
+ 
+ Balance
+ as of September 30, 2023 
+ 28,660,000 
+ $2,233 
+ 1,000,000 
+ $78 
+ $(3,974) 
+ $2,011,663 
+ $258,140 
+ $2,268,140 
+
+ 
+ Balance as of April 1,
+ 2024 
+ 28,660,000 
+ $2,233 
+ 1,000,000 
+ $78 
+ $(3,974) 
+ $2,011,663 
+ $491,061 
+ $2,501,061 
+
+ 
+ Net
+ Profit 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ 2,711,539 
+ 2,711,539 
+
+ 
+ Balance
+ as of September 30, 2024 
+ 28,660,000 
+ $2,233 
+ 1,000,000 
+ $78 
+ $(3,974) 
+ $2,011,663 
+ $3,202,600 
+ $5,212,600 
+
+ 
+ 
+
+*
+The shares amounts are presented on a retroactive basis.
+
+ 
+
+See
+accompanying notes to unaudited consolidated financial statements.
+
+ 
+
+ F-4
+
+ 
+
+ 
+
+ 
+
+DREAMLAND
+LIMITED AND SUBSIDIARIES
+
+UNAUDITED
+CONSOLIDATED STATEMENTS OF CASH FLOWS
+
+ 
+
+ 
+ 
+ Six Months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Cash flows from operating activities: 
+ 
+ 
+
+ 
+ Net Profit before tax 
+ $1,378,953 
+ $3,061,539 
+
+ 
+ Adjustments to reconcile net profit to net cash provided by operating activities 
+ 
+ 
+
+ 
+ Interest income 
+ (354) 
+ (38,676)
+
+ 
+ Finance costs 
+ 129,176 
+ 232,971 
+
+ 
+ Amortization 
+ - 
+ 2,318,444 
+
+ 
+ Depreciation of equipment 
+ - 
+ 35,451 
+
+ 
+ Depreciation of right of use assets 
+ 149,906 
+ 203,198 
+
+ 
+ Impairment of right of use assets 
+ - 
+ 111,136 
+
+ 
+ Change in operating assets and liabilities: 
+ 
+ 
+
+ 
+ Contract assets 
+ (590,942) 
+ (2,783,318)
+
+ 
+ Inventory 
+ - 
+ (1,493,042)
+
+ 
+ Trade receivable 
+ (1,718,879) 
+ (6,215,158)
+
+ 
+ Deposits, prepayments and other receivables 
+ 8,700 
+ (1,558,142)
+
+ 
+ Amount due from related parties 
+ - 
+ (2,133,521)
+
+ 
+ Trade payable and other payable 
+ 1,069,927 
+ 913,351 
+
+ 
+ Amount due from/(to) joint operation parties 
+ - 
+ (1,650,768)
+
+ 
+ Contract liabilities 
+ - 
+ 1,102,665 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net cash provided by/(used in) operating activities 
+ 426,487 
+ (7,893,870)
+
+ 
+ 
+ 
+ 
+
+ 
+ Cash flows from investing activities: 
+ 
+ 
+
+ 
+ Intangible assets 
+ - 
+ (5,371,777)
+
+ 
+ Interest received 
+ 354 
+ 38,676 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net cash provided by/(used in) investing activities 
+ 354 
+ (5,333,101)
+
+ 
+ 
+ 
+ 
+
+ 
+ Cash flows from financing activities: 
+ 
+ 
+
+ 
+ Proceeds from a shareholder 
+ 1,236,520 
+ 7,065,391 
+
+ 
+ Payments to a shareholder 
+ (1,334,381) 
+ (4,067,903)
+
+ 
+ Proceeds from bank overdrafts 
+ - 
+ 5,588,324 
+
+ 
+ Proceeds from bank borrowings 
+ - 
+ 2,877,679 
+
+ 
+ Repayment of bank borrowings – principal 
+ (216,003) 
+ (446,136)
+
+ 
+ Repayment of bank borrowings – interest 
+ (116,094) 
+ (217,537)
+
+ 
+ Repayment of leases liabilities – principal 
+ (124,408) 
+ (25,586)
+
+ 
+ Repayment of leases liabilities – interest 
+ (13,082) 
+ (1,192)
+
+ 
+ 
+ 
+ 
+
+ 
+ Net cash provided by/(used in) financing activities 
+ (567,448) 
+ 10,773,040 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net change in cash and bank balances 
+ (140,607) 
+ (2,453,931)
+
+ 
+ 
+ 
+ 
+
+ 
+ BEGINNING OF PERIOD 
+ 328,214 
+ 3,817,083 
+
+ 
+ 
+ 
+ 
+
+ 
+ END OF PERIOD 
+ $187,607 
+ $1,363,152 
+
+ 
+ 
+ 
+ 
+
+ 
+ SUPPLEMENTAL CASH FLOW INFORMATION: 
+ 
+ 
+
+ 
+ Cash paid for income taxes 
+ $- 
+ $- 
+
+ 
+ Cash paid for interest 
+ $(129,176) 
+ $(232,971)
+
+ 
+
+ 
+
+See
+accompanying notes to consolidated financial statements.
+
+ 
+
+ F-5
+
+ 
+
+ 
+
+ 
+
+DREAMLAND
+LIMITED AND SUBSIDIARIES
+
+NOTES
+TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
+
+ 
+
+NOTE 1
+BUSINESS OVERVIEW AND BASIS OF PRESENTATION
+
+ 
+
+Dreamland
+Limited, or the Company is incorporated under the laws of the Cayman Islands with limited liability on July 5, 2024. The Company, through
+its subsidiaries, collectively referred to as the Group, are mainly engaged in the provision of design, products sales, and event management
+services. During the six months ended September 30, 2024, the Group started to be event organizer for the events.
+
+ 
+
+Description
+of subsidiaries incorporated and controlled by the Company
+
+ 
+
+ 
+ Name
+ 
+ Background
+ 
+ Effective
+ ownership
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Goal
+ Success Limited, or Goal Success
+ 
+ 
+ British
+ Virgin Islands company
+ 
+ 100%
+ owned by Dreamland
+
+ 
+ 
+ 
+ Incorporated
+ on July 25, 2024
+ 
+ 
+
+ 
+ 
+ 
+ Issued
+ and outstanding 1 Ordinary Share for USD 1
+ 
+ 
+
+ 
+ 
+ 
+ Investment
+ holding
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Trendic
+ International Limited, or TIL
+ 
+ 
+ Hong
+ Kong company
+ 
+ 100%
+ owned by Goal Success
+
+ 
+ 
+ 
+ Incorporated
+ on April 11, 2016
+ 
+ 
+
+ 
+ 
+ 
+ Issued and paid up Class A Ordinary Shares without par value of 20,000
+shares for HK$2,010,000
+ 
+ 
+
+ 
+ 
+ 
+ Provision
+ of design, merchandised sales, and event management services to event organizer.
+ 
+ 
+
+ 
+ 
+ 
+ 
+ During
+ the six months ended September 2024, TIL also provided event services as event organizer.
+ 
+ 
+
+ 
+ 
+
+Reorganization
+
+ 
+
+Since
+July 5, 2024, the Company completed several transactions for the purposes of a group reorganization.
+
+ 
+
+Prior
+to a group reorganization, TIL was held as to 95.3% by Ms. Seto and 4.7% by Ms. Yip Ka Ki Cherry. For details, please refer to section
+History and Corporate Structure of this prospectus. Upon completion of the reorganization, Ms. Seto, a controlling shareholder, and Ms.
+Yip ultimately owns 76.4% and 4.7% Class A Ordinary Shares shareholding of the Company, respectively, and 100% and nil Class
+B Ordinary Shares shareholding of the Company, respectively. Goal Success and TIL become indirectly owned subsidiaries of the Company.
+
+ 
+
+During
+the six months ended September 30, 2023 and 2024 presented in these unaudited consolidated financial statements, the control of these
+entities has been demonstrated by Ms. Seto, as if the reorganization had taken place at the beginning of the earlier date presented.
+Accordingly, the consolidation has been treated as a corporate restructuring, or Reorganization, of entities under common control and
+thus the current capital structure has been retroactively presented in prior periods as if such structure existed at that time, the entities
+under common control are presented on a consolidated basis for all periods to which such entities were under common control. The consolidation
+of the Company and its subsidiaries has been accounted for at historical cost and prepared on the basis as if the aforementioned transactions
+had become effective as of the beginning of the first period presented in the accompanying consolidated financial statements.
+
+ 
+
+ F-6
+
+ 
+
+ 
+
+ 
+
+NOTE 2
+SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
+
+ 
+
+These
+accompanying consolidated financial statements reflect the application of certain significant accounting policies as described in this
+note and elsewhere in the accompanying consolidated financial statements and notes.
+
+ 
+
+ 
+ 
+ Basis
+ of Presentation
+
+ 
+ 
+
+These
+financial statements have been prepared in accordance with International Financial Reporting Standards and International Accounting Standards
+as issued by the International Accounting Standards Board (IASB) and Interpretations (collectively IFRS Accounting Standards).
+
+ 
+
+The
+preparation of financial statements in compliance with adopted IFRS Accounting Standards requires the use of certain accounting estimates.
+It also requires Group management to exercise judgment in applying the Group s accounting policies.
+
+ 
+
+Changes
+in accounting policies
+
+ 
+
+a)
+New standards, interpretations and amendments adopted from January 1, 2024
+
+ 
+
+The
+following amendments are effective for the period beginning January 1, 2024:
+
+ 
+
+ 
+ 
+ 
+ Liability
+ in a Sale and Leaseback (Amendments to IFRS 16 Leases);
+
+ 
+ 
+ 
+ Classification
+ of Liabilities as Current or Non-Current (Amendments to IAS 1 Presentation of Financial Statements);
+
+ 
+ 
+ 
+ Non-current
+ Liabilities with Covenants (Amendments to IAS 1 Presentation of Financial Statements); and
+
+ 
+ 
+ 
+ Supplier
+ Finance Arrangements (Amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures)
+
+ 
+ 
+
+These
+amendments to various IFRS Accounting Standards are mandatorily effective for reporting periods beginning on or after January 1, 2024.
+These amendments have no effect on the measurement of any items in the financial statements of the Group.
+
+ 
+
+ F-7
+
+ 
+
+ 
+
+ 
+
+b)
+New standards, interpretations and amendments not yet effective
+
+ 
+
+There
+are a number of standards, amendments to standards, and interpretations which have been issued by the IASB that are effective in future
+accounting periods that the Group has decided not to adopt early.
+
+ 
+
+The
+following amendments are effective for the period beginning January 1, 2025:
+
+ 
+
+ 
+ 
+ 
+ Lack
+ of Exchangeability (Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates)
+
+ 
+ 
+
+The
+Group is currently assessing the impact of these new accounting standards and amendments. The Group does not expect the amendments and
+other standards issued by the IASB, but are yet to be effective, to have a material impact on the Group.
+
+ 
+
+ 
+ 
+ Basis
+ of Consolidation
+
+ 
+ 
+
+The consolidated financial statements
+include the financial statements of the Company and its subsidiaries. All significant inter-company balances and transactions within
+the Company have been eliminated upon consolidation.
+
+ 
+
+ 
+ 
+ Use
+ of Estimates and Assumptions
+
+ 
+ 
+
+The
+preparation of consolidated financial statements in conformity with IFRS Accounting Standards require management to make estimates and
+assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the
+date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented. Significant
+accounting estimates in the period include the revenue recognition for provision of event management services, allowance for doubtful
+accounts on accounts, and provision for income tax. Actual results may differ from these estimates.
+
+ 
+
+ 
+ 
+ Foreign
+ Currency Translation and Transaction
+
+ 
+ 
+
+The
+Company uses Hong Kong Dollars as its reporting currency. The functional currency of the Group is Hong Kong Dollar. All amounts have
+been rounded to the nearest thousand, unless otherwise indicated.
+
+ 
+
+Monetary
+assets and liabilities denominated in currencies other than the applicable functional currencies are translated into the functional currencies
+at the prevailing rates of exchange at the balance sheet date. Nonmonetary assets and liabilities are remeasured into the applicable
+functional currencies at historical exchange rates.
+
+ 
+
+Transactions
+denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing
+at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated
+into the functional currency using the applicable exchange rates at the balance sheet dates. Translation gains and losses that arise
+from exchange rate fluctuations from transactions denominated in a currency other than the functional currency are translated, as the
+case may be, at the rate on the date of the transaction and included in the results of operations as incurred.
+
+ 
+
+ F-8
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Cash
+ and Cash in Bank
+
+ 
+ 
+
+Cash
+and cash in bank consist primarily of cash in readily available checking and saving accounts. The
+Company maintains most of its bank accounts in Hong Kong.
+
+ 
+
+ 
+ 
+ Accounts
+ Receivable and Allowance for Doubtful Accounts
+
+ 
+ 
+
+Accounts
+receivable include trade accounts due from customers in the rendering of service.
+
+ 
+
+Accounts
+receivable are recorded at the invoiced amount and do not bear interest, which are due upon invoice was presented. The Company seeks
+to maintain strict control over its outstanding receivables to minimize credit risk. Overdue balances are reviewed regularly by senior
+management. Management reviews its receivables on a regular basis to determine if the bad debt allowance is adequate and provides allowance
+when necessary. The allowance is based on management s best estimates of specific losses on individual customer exposures, as well
+as the historical trends of collections. Account balances are charged off against the allowance after all means of collection have been
+exhausted and the likelihood of collection is not probable. The Company s management continues to evaluate the reasonableness of
+the valuation allowance policy and update it if necessary.
+
+ 
+
+The
+Company does not hold any collateral or other credit enhancements overs its accounts receivable balances.
+
+ 
+
+ 
+ 
+ Lease
+
+ 
+ 
+
+The
+Group assesses at contract inception whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract
+conveys the right to control the use of an identified asset for a period of time in exchange for consideration.
+
+ 
+
+Group
+as a lessee
+
+ 
+
+The
+Group applies a single recognition and measurement approach for all leases, except for short-term leases and leases of low-value assets.
+The Group recognizes lease liabilities to make lease payments and right-of-use assets representing the right to use the underlying assets.
+
+ 
+
+ 
+ (a)
+ Right-of-use
+ assets
+
+ 
+ 
+
+Right-of-use
+assets are recognized at the commencement date of the lease (that is the date the underlying asset is available for use). Right-of-use
+assets are measured at cost, less accumulated depreciation and any impairment losses, and adjusted for any remeasurement of lease liabilities.
+The cost of right-of-use assets includes the amount of lease liabilities recognized, initial direct costs incurred, and lease payments
+made at or before the commencement date less any lease incentives received. Right-of-use assets are depreciated on a straight-line basis
+over the shorter of the lease terms and the estimated useful lives of the assets as follows:
+
+ 
+
+ 
+ 
+ Office
+ premises
+ based
+ on lease terms
+
+ 
+ 
+ Motor
+ vehicles
+ 3
+ years
+
+ 
+ 
+
+ F-9
+
+ 
+
+ 
+
+ 
+
+Lease
+(continued)
+
+ 
+
+Group
+as a lessee (continued)
+
+ 
+
+If
+ownership of the leased asset transfers to the Group by the end of the lease term or the cost reflects the exercise of a purchase option,
+depreciation is calculated using the estimated useful life of the asset.
+
+ 
+
+ 
+ (b)
+ Lease
+ liabilities
+
+ 
+ 
+ 
+
+ 
+ 
+ Lease
+ liabilities are recognized at the commencement date of the lease at the present value of lease payments to be made over the lease
+ term. The lease payments include fixed payments (including in- substance fixed payments) less any lease incentives receivable, variable
+ lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments
+ also include the exercise price of a purchase option reasonably certain to be exercised by the Group and payments of penalties for
+ termination of a lease, if the lease term reflects the Group exercising the option to terminate the lease. The variable lease payments
+ that do not depend on an index or a rate are recognized as an expense in the period in which the event or condition that triggers
+ the payment occurs.
+
+ 
+ 
+ 
+
+ 
+ 
+ In
+ calculating the present value of lease payments, the Group uses its incremental borrowing rate at the lease commencement date because
+ the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities
+ is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease
+ liabilities is remeasured if there is a modification, a change in the lease term, a change in lease payments (e.g., a change to future
+ lease payments resulting from a change in an index or rate) or a change in assessment of an option to purchase the underlying asset.
+
+ 
+ 
+ 
+
+ 
+ (c)
+ Short-term
+ leases and leases of low-value assets
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ Group applies the short-term lease recognition exemption to its short-term leases of equipment (that is those leases that have a
+ lease term of 12 months or less from the commencement date and do not contain a purchase option). It also applies the recognition
+ exemption for leases of low-value assets to leases of office equipment that are considered to be of low value.
+
+ 
+ 
+ 
+
+ 
+ 
+ Lease
+ payments on short-term leases and leases of low-value assets are recognized as an expense on a straight-line basis over the lease
+ term.
+
+ 
+ 
+
+ 
+ 
+ Equipment
+
+ 
+ 
+
+Equipment
+are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line
+basis over the following expected useful lives from the date on which they become fully operational and after taking into account their
+estimated residual values:
+
+ 
+
+ 
+ 
+ Expected
+ useful life
+ 
+
+ 
+ Leasehold
+ improvement
+ The
+ lower of lease term or useful life
+ 
+
+ 
+ 
+
+Expenditure
+for repairs and maintenance is expensed as incurred. When assets have retired or sold, the cost and related accumulated depreciation
+are removed from the accounts and any resulting gain or loss is recognized in the results of operations.
+
+ 
+
+ F-10
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Interests
+ in Joint Operations
+
+ 
+ 
+ 
+
+ 
+ 
+ During
+ the six months ended September 30, 2024, the Group entered into joint operation arrangement for certain events. In return, the Group
+ will have project sharing at agreed portion. A joint operation is a joint arrangement whereby the parties that have joint control
+ of the arrangement have rights to the assets, and obligations for the liabilities, relating to the arrangement. Joint control is
+ the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require
+ the unanimous consent of the parties sharing control.
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ Group recognizes in relation to its interest in a joint operation:
+
+ 
+ 
+
+ 
+ 
+ 
+ its
+ assets, including its share of any assets held jointly;
+
+ 
+ 
+ 
+ its
+ liabilities, including its share of any liabilities incurred jointly;
+
+ 
+ 
+ 
+ its
+ revenue from the sale of its share of the output arising from the joint operation;
+
+ 
+ 
+ 
+ its
+ share of the revenue from the sale of the output by the joint operation; and
+
+ 
+ 
+ 
+ its
+ expenses, including its share of any expenses incurred jointly.
+
+ 
+ 
+
+ 
+ 
+ The
+ assets, liabilities, revenues and expenses relating to the Group s interest in a joint operation are accounted for in accordance
+ with the relevant IFRSs such as IFRS 11 applicable to the particular assets, liabilities, revenues and expenses, and recognized based
+ on the profit sharing ratio on each event. The amount due from/(to) joint operation parties will be recognized based on payment/receipt
+ by the Group and joint operation accordingly.
+
+ 
+ 
+ 
+
+ 
+ 
+ Intangible
+ Assets
+
+ 
+ 
+
+Purchased
+licenses are stated at cost less any impairment losses and are amortized on the straight- line of numbers of approval of organizing events
+and then straight line over each relevant event periods. For the event with single location and one time approval and the Company operates
+themselves and no residual value or right can be transferred, they have not accounted as intangible assets, and recorded under contract
+cost.
+
+ 
+
+ 
+ 
+ Inventories
+
+ 
+ 
+
+Inventories
+are stated at the lower of cost and net realisable value. Cost, which comprises all costs of purchase and, where applicable, cost of
+conversion and other costs that have been incurred in bringing the inventories to their present location and condition, is calculated
+using the first in, first out method. Net realisable value represents the estimated selling price in the ordinary course of business
+less the estimated costs of completion and the estimated costs necessary to make the sale.
+
+ 
+
+ 
+ 
+ Revenue
+ Recognition
+
+ 
+ 
+
+The
+Company adopted Accounting Standards Revenue
+from Contracts with Customers (IFRS 15), which provided the following overview of how revenue is recognized from the Company s
+contracts with customers: The Company recognizes revenue to depict the transfer of promised goods or services to customers in an amount
+that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services.
+
+ 
+
+Step
+1: Identify the contract(s) with a customer.
+
+ 
+
+Step
+2: Identify the performance obligations in the contract.
+
+ 
+
+Step
+3: Determine the transaction price – The transaction price is the amount of consideration in a contract to which an entity expects
+to be entitled in exchange for transferring promised goods or services to a customer.
+
+ 
+
+Step
+4: Allocate the transaction price to the performance obligations in the contract – Any entity typically allocates the transaction
+price to each performance obligation on the basis of the relative standalone selling prices of each distinct good or service promised
+in the contract.
+
+ 
+
+Step
+5: Recognize revenue when (or as) the entity satisfies a performance obligation – An entity recognizes revenue when (or as) it
+satisfies a performance obligation by transferring a promised good or service to a customer (which is when the customer obtains control
+of that good or service). The amount of revenue recognized is the amount allocated to the satisfied performance obligation. A performance
+obligation may be satisfied at a point in time (typically for promises to transfer goods to a customer) or over time (typically for promises
+to transfer service to a customer).
+
+ 
+
+ F-11
+
+ 
+
+ 
+
+ 
+
+Revenue
+related to event planner
+
+ 
+
+The
+Company identified the following three types of performances under the event management contract: i) events planning, design, development
+and operation, or the Event Management Services; ii) Procurement and sales of goods (including but not limited to IP goods, drinks, tickets)
+to customer; iii) sponsorship commission income. The Company s revenue is derived from contracts with customers in the rendering
+of Event Management Services, and as such, the revenue recognized depicts the transfer of promised services to its customers in an amount
+that reflects the consideration to which the Company expects to be entitled in exchange for those services when the events start. The
+Company considers the terms of the contract and all relevant facts and circumstances when applying this guidance. The duration of the
+service period is usually less than one year. The Company recognize Event Management Services revenue when the event starts and during
+the event period ratably because: i) Based on the contract terms, none of parties that entered into the contract can terminate, and find
+other vendors to substitute the services; ii) And the customer benefits from our service beginning at the point of the event started
+to the event completion. The Company generally requires the customers to make the advanced payment at certain percentage of the total
+contract value upon signing the agreement. Contract liabilities are recorded when the advanced payment is received from the customers
+before all of the relevant criteria for revenue recognition has been met. The event management contract price is lump sum basis, consisted
+of sales of goods and Event Management Services consideration. For allocation of transaction price of sales of goods and Event Management
+Services, the company applied cost plus margin method to determine the sales of goods revenue based on standalone sales of goods gross
+margin, and allocate the remaining provision consideration into event management services. For sponsorship commission income, there is
+specified percentage calculation based on sponsorship fee raised (if any).
+
+ 
+
+For
+sponsorship commission income, it is sponsorship for the whole event period and recognized over the event period align with Event Management
+Services.
+
+ 
+
+Revenue
+related to event organizer
+
+ 
+
+The
+Company obtained IP directly from IP owner and authorized to convene events as organizer or co-organizer. The Company identified the
+following four types of performances under the event: i) sales of event tickets for the events; ii) Procurement and sales of goods (including
+but not limited to IP goods, drinks) to customer; iii) sponsorship commission income and (iv) ad hoc requested by customer say video
+production for the event
+
+ 
+
+The
+Company sold the event tickets through on site or sales platform. For event tickets income, it is recognized upon the provision of events.
+
+ 
+
+The
+Company sold the goods at the event. Revenue from sales of goods is recognized at a point in time when control of the goods has been
+transferred to the customers. Control is primarily evidenced by taking physical possession and inventory risk of the goods. The Group
+controls the goods and determines the selling price or allocated selling price (under event management services contracts) of the good
+before the good is transferred to the customers.
+
+ 
+
+For
+sponsorship commission income, there is specified percentage calculation based on sponsorship fee raised (if any). For sponsorship commission
+income, it is sponsorship for the whole event period and recognized over the event period align with Event Management Services.
+
+ 
+
+For
+ad hoc income say video production, it is recognized upon the video delivered and confirmed by customer.
+
+ 
+
+For
+events have co-organizer, the revenue recognition is similar the above under heading revenue related to event organizer but proportion
+based on agreed terms to the agreement with joint operations parties. Please refer to interest in joint operations paragraph in Note
+2.
+
+ 
+
+Design
+
+ 
+
+Revenue
+from designed services is recognized over the time. The revenue generated from design services are generally based on the fixed fee billing
+arrangements that require the clients to pay a pre-established fee in exchange for a predetermined set of design services. The design
+services provide involve a series of tasks which are distinct and meet the criteria for recognizing revenue overtime. In addition, the
+Group concludes that the services provided each month are substantially similar and result in the transfer of substantially similar services
+to the clients each month. The Group recognizes revenues from design services on a monthly basis when it satisfies its performance obligations
+throughout the contract terms. Due to the design works were performed by inhouse designer and/or monitored by in-house designer through
+external designer (value added services), the Company controls the specified designed services before that services are transferred to
+a customer and the Company will determine the selling price, and thus, the Company is principal instead of agent for design services.
+
+ 
+
+ F-12
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Cost
+ of Revenue
+
+ 
+ 
+
+Direct
+cost of revenues mainly consists of subcontracting to event facilitators, front line staff costs, cost of goods sold which are attributable
+to the revenue-generating activities of the Group provides for its clients,
+
+ 
+
+ 
+ 
+ Contract
+ Costs
+
+ 
+ 
+
+A
+contract cost represents cost incurred to fulfil a contract with a customer. Contract cost is capitalized as an asset if all of the following
+criteria are met:
+
+ 
+
+(a)
+The cost relates directly to a contract or to an anticipated contract that the entity can specifically identify;
+
+ 
+
+(b)
+The cost generates or enhances resources of the entity that will be used in satisfying (or in continuing to satisfy) performance obligations
+in the future;
+
+ 
+
+(c)
+The cost is expected to be recovered
+
+ 
+
+The
+capitalized contract cost is amortized and charged to the statement of operations on a systematic basis that is consistent with the pattern
+of the revenue to which the asset related is recognized.
+
+ 
+
+For
+contract costs incurred for events with co-organizers, the project costs will be recognized in accordance with sharing agreed terms in
+the agreements.
+
+ 
+
+ 
+ 
+ Contract
+ Liabilities
+
+ 
+ 
+
+A
+contract liability is recognized when a payment is received or a payment is due (whichever is earlier) from a customer before the Group
+transfers the related goods or services. Contract liabilities are recognized as revenue when the Group performs under the contract (i.e.,
+transfers control of the related goods or services to the customer).
+
+ 
+
+ 
+ 
+ Dividends
+
+ 
+ 
+
+Final
+dividends are recognized as a liability when they are approved by the shareholders in a general meeting. Proposed final dividends are
+disclosed in the notes to the financial statements. Interim dividends are simultaneously proposed and declared, and recognized immediately
+as a liability when they are proposed and declared.
+
+ 
+
+ 
+ 
+ Income
+ Taxes
+
+ 
+ 
+
+Income
+tax
+
+ 
+
+Income
+tax comprises current and deferred tax. Income tax relating to items recognized outside profit or loss is recognized outside profit or
+loss, either in other comprehensive income or directly in equity.
+
+ 
+
+Current
+tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities, based on tax
+rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period, taking into consideration interpretations
+and practices prevailing in the countries in which the Group operates.
+
+ 
+
+Deferred
+tax is provided, using the liability method, on all temporary differences at the end of the reporting period between the tax bases of
+assets and liabilities and their carrying amounts for financial reporting purposes.
+
+ 
+
+Deferred
+tax liabilities are recognized for all taxable temporary differences, except when the deferred tax liability arises from the initial
+recognition of goodwill or an asset or liability in a transaction that is not a business combination and, at the time of the transaction,
+affects neither the accounting profit nor taxable profit or loss and does not give rise to equal taxable and deductible temporary differences;
+and in respect of taxable temporary differences associated with investments in subsidiaries, associates and joint ventures, when the
+timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse
+in the foreseeable future.
+
+ 
+
+ F-13
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Income
+ Taxes (continued)
+
+ 
+ 
+
+Deferred
+tax assets are recognized for all deductible temporary differences, and the carryforward of unused tax credits and any unused tax losses.
+Deferred tax assets are recognized to the extent that it is probable that taxable profit will be available against which the deductible
+temporary differences, and the carryforward of unused tax credits and unused tax losses can be utilized, except when the deferred tax
+asset relating to the deductible temporary differences arises from the initial recognition of an asset or liability in a transaction
+that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss
+and does not give rise to equal taxable and deductible temporary differences; and in respect of deductible temporary differences associated
+with investments in subsidiaries, associates and joint ventures, deferred tax assets are only recognized to the extent that it is probable
+that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary
+differences can be utilized.
+
+ 
+
+The
+carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer
+probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized. Unrecognized
+deferred tax assets are reassessed at the end of each reporting period and are recognized to the extent that it has become probable that
+sufficient taxable profit will be available to allow all or part of the deferred tax asset to be recovered.
+
+ 
+
+Deferred
+tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realized or the liability
+is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.
+
+ 
+
+Deferred
+tax assets and deferred tax liabilities are offset if and only if the Group has a legally enforceable right to set off current tax assets
+and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation
+authority on either the same taxable entity or different taxable entities which intend either to settle current tax liabilities and assets
+on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in which significant amounts
+of deferred tax liabilities or assets are expected to be settled or recovered.
+
+ 
+
+ 
+ 
+ Earnings
+ per Share
+
+ 
+ 
+
+The
+Company computes earnings/losses per share, or EPS, requires companies to present basic and diluted EPS. Basic EPS is measured as
+net income divided by the weighted average Class A Ordinary Share outstanding for the period. Diluted EPS presents the dilutive
+effect on a per share basis of the potential Class A Ordinary Shares (e.g., convertible securities, options and warrants) as if they
+had been converted at the beginning of the periods presented, or issuance date, if later. Potential Class A Ordinary Shares that
+have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the
+calculation of diluted EPS. During the six months ended September 30, 2023 and 2024, there was no dilutive shares.
+
+ 
+
+ 
+ 
+ Retirement
+ Plan Costs
+
+ 
+ 
+
+Contributions
+to retirement plans (which are defined contribution plans) are charged to general and administrative expenses in the accompanying statements
+of operation as the related employee service are provided. The Company is required to make contribution for their employees under a government-mandated
+multi-employer defined contribution pension scheme for its eligible full-time employees in Hong Kong. The Company is required to contribute
+a specified percentage of the participants relevant income based on their ages and wages level. During the six months ended September
+30, 2023 and 2024, HKD$30,920 and HKD$70,267 contributions were made accordingly. During the six months ended September 30, 2024, the
+Company purchased insurance for Ms. Seto with defined contribution of US$50,000 per annum for the period of five years and recorded as
+selling, general and administrative expenses.
+
+ 
+
+ F-14
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Segment
+ Reporting
+
+ 
+ 
+
+The
+Group operates and manages its business as a single segment. The Group s chief operating decision maker, or CODM, is the Chairman.
+The Group s CODM assess the Group s performance and results of operations on a consolidated basis. The Group generates substantially
+all of its revenues from clients in Hong Kong. Accordingly, no geographical segments are presented. Substantially all of the Group s
+long-lived assets are located in Hong Kong.
+
+ 
+
+ 
+ 
+ Related
+ Parties
+
+ 
+ 
+
+Parties
+are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant
+influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject
+to common control or significant influence of the same party, such as a family member or relative, shareholder, or a related corporation.
+
+ 
+
+ 
+ 
+ Concentration
+ of Credit Risk
+
+ 
+ 
+
+Financial
+instruments that potentially subject the Company to credit risk consist of cash equivalents and accounts receivable. Cash equivalents
+are maintained with high credit quality institutions, the composition and maturities of which are regularly monitored by management.
+The Hong Kong Deposit Protection Board pays compensation up to a limit of HKD500,000 if the bank with which an individual/a company hold
+its eligible deposit fails. As of March 31, 2024 and September 30, 2024, cash and bank balances of HKD3,817,083 and HKD1,363,152 was maintained
+at financial institutions in Hong Kong, of which none of its cash balance was subject to credit risk. However, if the individual bank
+balance is over HKD500,000, the excess will be subject to credit risk if the relevant bank fails. While management believes that these
+financial institutions are of high credit quality, it also continually monitors their credit worthiness.
+
+ 
+
+For
+accounts receivable, the Company determines, on a continuing basis, the allowance for doubtful accounts based on the estimated realizable
+value. The Company identifies credit risk on a customer by customer basis. The information is monitored regularly by management. Concentration
+of credit risk arises when a group of customers having similar characteristics such that their ability to meet their obligations is expected
+to be affected similarly by changes in economic conditions.
+
+ 
+
+The
+Company has determined the default event on a financial asset to be when internal and/or external information indicates that the financial
+asset is unlikely to be received, which could include default of contractual payments due for more than 90 days, default of interest
+due for more than 365 days or there is significant difficulty of the counterparty. To minimize credit risk, the Company has developed
+and maintained its credit risk grading to categorize exposures according to their degree of risk of default. The credit rating information
+is supplied by publicly available financial information and the Company s own trading records to rate its major customers and other
+debtors.
+
+ 
+
+As
+of March 31, 2024 and September 30, 2024, there were accounts receivables of HKD826,687 and HKD7,041,845, respectively. Two of customers
+as at March 31, 2024 and September 30, 2024 are amounted to 10% or more of the total consolidated amounts.
+
+ 
+
+ F-15
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Liquidity
+ Risk
+
+ 
+ 
+
+Liquidity
+risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company s policy is
+to ensure that it has sufficient cash to meet its liabilities when they become due, under both normal and stressed conditions, without
+incurring unacceptable losses or risking damage to the Company s reputation. A key risk in managing liquidity is the degree of
+uncertainty in the cash flow projections. If future cash flows are fairly uncertain, the liquidity risk increases. Liquidity risk is
+controlled by the application of financial position analysis and monitoring procedures. When necessary, we will turn to financial institutions
+and related parties to obtain short-term funding to cover any liquidity shortage.
+
+ 
+
+ 
+ 
+ Fair
+ Value Measurement
+
+ 
+ 
+
+The
+Company establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:
+
+ 
+
+ 
+ 
+ Level
+ 1: Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets;
+
+ 
+ 
+ 
+
+ 
+ 
+ Level
+ 2: Inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments
+ in markets that are not active, and model-based valuation techniques (e.g. Black-Scholes Option-Pricing model) for which all significant
+ inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets
+ or liabilities. Where applicable, these models project future cash flows and discount the future amounts to a present value using
+ market-based observable inputs; and
+
+ 
+ 
+ 
+
+ 
+ 
+ Level
+ 3: Inputs are generally unobservable and typically reflect management s estimates of assumptions that market participants
+ would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option
+ pricing models and discounted cash flow models.
+
+ 
+ 
+
+The
+carrying value of the Company s financial instruments: cash and bank balances, contract costs, accounts receivable, deposits, prepayments
+and other receivables, trade and other payables, tax payable, contract liabilities approximate at their fair values because of the short-term
+nature of these financial instruments.
+
+ 
+
+Fair
+value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates
+are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision.
+Changes in assumptions could significantly affect the estimates.
+
+ 
+
+ F-16
+
+ 
+
+ 
+
+ 
+
+NOTE
+– 3 SEGMENT INFORMATION AND REVENUE
+
+ 
+
+Information
+about major customers
+
+ 
+
+Revenue
+from customers of the corresponding periods contributing over 10% of the total revenue of the Group are as follows:
+
+ 
+
+ 
+ 
+ Percentage of 
+ Six Months ended September 30, 
+
+ 
+ 
+ respective fiscal period 
+ 2023 
+ 2024 
+
+ 
+ 
+ 2023 
+ 2024 
+ HKD 
+ HKD 
+
+ 
+ Customer A 
+ 50.6% 
+ - 
+ $1,907,849 
+ $- 
+
+ 
+ Customer B 
+ 42.5% 
+ 21.7% 
+ $1,602,387 
+ $6,723,413 
+
+ 
+ Customer C 
+ - 
+ 30.1% 
+ - 
+ 9,350,021 
+
+ 
+
+ 
+
+An
+analysis of revenue is as follows:
+
+ 
+
+ 
+ 
+ Six Months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Provision of event management 
+ $251,102 
+ $4,423,413 
+
+ 
+ Sales of goods 
+ 2,796,973 
+ 6,969,091 
+
+ 
+ Tickets 
+ - 
+ 6,902,453 
+
+ 
+ Sponsorship 
+ - 
+ 3,769,374 
+
+ 
+ Video production 
+ - 
+ 8,950,021 
+
+ 
+ Design and others 
+ 725,000 
+ - 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total: 
+ $3,773,075 
+ $31,014,352 
+
+ 
+
+ 
+
+The
+following tables present the Company s revenue disaggregated by timing of revenue recognition, based on management s assessment
+of available data:
+
+ 
+
+ 
+ 
+ Six Months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Over time 
+ $976,102 
+ $17,142,808 
+
+ 
+ At a point in time 
+ 2,796,973 
+ 13,871,544 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total: 
+ $3,773,075 
+ $31,014,352 
+
+ 
+
+ 
+
+ F-17
+
+ 
+
+ 
+
+ 
+
+NOTE
+– 4 OTHER INCOME/(EXPENSES)
+
+ 
+
+ 
+ 
+ Six Months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Bank interest income 
+ $354 
+ $38,676 
+
+ 
+ Finance costs 
+ (129,176) 
+ (232,971)
+
+ 
+ Others 
+ - 
+ 1,000 
+
+ 
+ Total 
+ $(128,822) 
+ $(193,295)
+
+ 
+
+ 
+
+Finance
+costs represented interests for bank borrowings and finance leases during the six months ended September 30, 2023 and 2024.
+
+ 
+
+NOTE
+– 5 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
+
+ 
+
+The
+following table sets forth the breakdown of our selling, general and administrative expenses for the six months ended September 30, 2023
+and 2024:
+
+ 
+
+ 
+ 
+ Six Months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Accounting fee 
+ $- 
+ $48,000 
+
+ 
+ Bank charges 
+ 260 
+ 42,186 
+
+ 
+ Insurance expenses 
+ 25,347 
+ 20,755 
+
+ 
+ Staff payroll costs 
+ 30,920 
+ 1,082,423 
+
+ 
+ Listing fees 
+ - 
+ 1,933,527 
+
+ 
+ Legal and professional fees 
+ 4,055 
+ 188,842 
+
+ 
+ Travelling expenses 
+ - 
+ 83,017 
+
+ 
+ Marketing fee for events 
+ - 
+ 513,097 
+
+ 
+ Office expenses 
+ 8,891 
+ 107,549 
+
+ 
+ Sundries 
+ 2,981 
+ 207,244 
+
+ 
+ Total: 
+ $72,454 
+ $4,226,640 
+
+ 
+
+ 
+
+NOTE
+– 6 CONTRACT ASSETS
+
+ 
+
+ 
+ 
+ As of 
+ As of 
+
+ 
+ 
+ March 31, 
+2024 
+ September 30, 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Project costs incurred 
+ $4,337,713 
+ $7,121,031 
+
+ 
+
+ 
+
+Contract
+assets capitalized relate to prepaid project costs such as subcontracting fee incurred in satisfying performance obligations of respective
+projects in the future. Contract assets are recognized as part of direct costs in the statements of operations in the year in which revenue
+from the related projects is recognized. There is no impairment for the six months ended September 30, 2023 and 2024, respectively. The
+expected timing of recovery or settlement for contract assets as at September 30, 2024 is within one year. For project costs incurred
+for events with co-organizers, the project costs will be recognized in accordance with sharing agreed.
+
+ 
+
+ F-18
+
+ 
+
+ 
+
+ 
+
+NOTE
+– 7 ACCOUNTS RECEIVABLE, NET
+
+ 
+
+Accounts
+receivable, net consisted of the following:
+
+ 
+
+ 
+ 
+ As of 
+ As of 
+
+ 
+ 
+ March 31, 
+2024 
+ September 30, 
+2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Accounts receivable from third parties, net 
+ $826,687 
+ $7,041,845 
+
+ 
+
+ 
+
+The
+Company generally conducts its business with creditworthy third parties. The Company determines, on a continuing basis, the probable
+losses and an allowance for doubtful accounts, based on several factors including payment history, historical bad debt/write-off experience
+and forecasted economic and market conditions. Accounts receivable are written off after exhaustive collection efforts occur and the
+receivable is deemed uncollectible. In addition, receivable balances are monitored on an ongoing basis and its exposure to bad debts
+is not significant. Provision for allowance were nil during the six months ended September 30, 2023 and 2024, respectively.
+
+ 
+
+NOTE
+– 8 EQUIPMENT, NET
+
+ 
+
+Equipment
+consisted of the following:
+
+ 
+
+ 
+ 
+ As of 
+ As of 
+
+ 
+ 
+ March 31, 
+2024 
+ September 30, 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Office equipment, at cost 
+ $20,000 
+ $20,000 
+
+ 
+ Leasehold improvement, at cost 
+ 141,800 
+ 141,800 
+
+ 
+ Total 
+ 161,800 
+ 161,800 
+
+ 
+ Less: accumulated depreciation 
+ (25,908) 
+ (61,359)
+
+ 
+ 
+ 
+ 
+
+ 
+ Equipment, net 
+ $135,892 
+ $100,441 
+
+ 
+
+ 
+
+Depreciation
+expense for the six months ended September 30, 2023 and 2024 were nil and HKD35,451, respectively.
+
+ 
+
+ F-19
+
+ 
+
+ 
+
+ 
+
+NOTE
+– 9 LEASES
+
+ 
+
+As
+of March 31, 2024 and September 30, 2024, the Group, as lessee, subsisted of the following lease contracts for office premises and finance
+lease for motor vehicle. There is no low value/short term leases exception.
+
+ 
+
+ 
+ 
+ (a)
+ Right-of-use
+ assets
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ carrying amounts of the Group s right-of-use assets and the movements during the period are as follows:
+
+ 
+ 
+
+ 
+ 
+ Office 
+ Premises 
+ Motor 
+ vehicles 
+ Shops 
+ Total 
+
+ 
+ 
+ HKD 
+ HKD 
+ HKD 
+ HKD 
+
+ 
+ As at 1 April 2023 
+ 391,918 
+ 79,445 
+ - 
+ 471,363 
+
+ 
+ Additions 
+ 818,605 
+ - 
+ - 
+ 818,605 
+
+ 
+ Disposal 
+ - 
+ (7,945) 
+ - 
+ (7,945)
+
+ 
+ Early termination of operating lease 
+ (204,479) 
+ - 
+ - 
+ (204,479)
+
+ 
+ Depreciation charge 
+ (216,675) 
+ (71,500) 
+ - 
+ (288,175)
+
+ 
+ As at March 31, 2024 
+ 789,369 
+ - 
+ - 
+ 789,369 
+
+ 
+ Additions 
+ - 
+ - 
+ 138,919 
+ 138,919 
+
+ 
+ Depreciation 
+ (175,415) 
+ - 
+ (27,783) 
+ (203,198)
+
+ 
+ Impairment 
+ - 
+ - 
+ (111,136) 
+ (111,136)
+
+ 
+ As at September 30, 2024 
+ 613,954 
+ - 
+ - 
+ 613,954 
+
+ 
+
+ 
+
+ 
+ 
+ (b)
+ Lease
+ liabilities
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ carrying amount of lease liabilities and the movements during the period are as follows:
+
+ 
+ 
+
+ 
+ 
+ March 31, 
+2024 
+ September 30, 
+2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Carrying amount at 1 April 
+ 398,431 
+ 779,854 
+
+ 
+ New leases 
+ 818,605 
+ 138,919 
+
+ 
+ Accretion of interest recognized during the year 
+ 24,370 
+ 15,434 
+
+ 
+ Early termination of operating lease during the year/period 
+ (207,018) 
+ - 
+
+ 
+ Payments 
+ (254,534) 
+ (26,778)
+
+ 
+ 
+ 
+ 
+
+ 
+ Carrying amount at year/period end 
+ 779,854 
+ 907,429 
+
+ 
+ Analyzed into: 
+ 
+ 
+
+ 
+ Current portion 
+ 178,001 
+ 543,055 
+
+ 
+ Non-current portion 
+ 601,853 
+ 364,374 
+
+ 
+ Total 
+ 779,854 
+ 907,429 
+
+ 
+
+ 
+
+The
+following tables summarize the maturity of lease liabilities as at March 31, 2024 and September 30, 2024:
+
+ 
+
+ 
+ 
+ As of 
+March 31, 
+2024 
+ As of 
+September 30, 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ With one year 
+ 178,001 
+ 543,055 
+
+ 
+ One to two years 
+ 479,294 
+ 364,374 
+
+ 
+ Two to three years 
+ 122,559 
+ - 
+
+ 
+ Total 
+ 779,854 
+ 907,429 
+
+ 
+
+ 
+
+ F-20
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ (c)
+ The
+ amounts recognized in operations in relation to leases are as follows:
+
+ 
+
+ 
+ 
+
+ 
+ 
+ Six Months ended September 30 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Interest on lease liabilities 
+ 13,082 
+ 15,434 
+
+ 
+ Impairment 
+ - 
+ 111,136 
+
+ 
+ Depreciation: 
+ 
+ 
+
+ 
+ Depreciation charge of right-of-use assets 
+ 149,906 
+ 203,198 
+
+ 
+ Total amount recognized in statement of operations 
+ 162,988 
+ 329,768 
+
+ 
+
+ 
+
+NOTE
+– 10 INTANGIBLE ASSETS, NET
+
+ 
+
+ 
+ 
+ As of 
+ As of 
+
+ 
+ 
+ March 31, 
+2024 
+ September 30, 
+2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Licenses addition 
+ $- 
+ $6,138,444 
+
+ 
+ Less: transfer to joint operations parties 
+ - 
+ (766,667)
+
+ 
+ Less: amortization 
+ - 
+ (2,318,444)
+
+ 
+ 
+ 
+ 
+
+ 
+ Intangible assets, net 
+ $- 
+ $3,053,333 
+
+ 
+
+ 
+
+The
+balance represented licenses acquired for upcoming events. For events with co-organizers, relevant licenses will be transfer to joint
+operations parties as contract costs and then recognized based on the agreed terms of the agreement with joint operations parties over
+the event period as cost of revenue. Amortization expense for the six months ended September 30, 2023 and 2024 were nil and HKD2,318,444,
+respectively.
+
+ 
+
+NOTE
+– 11 DEPOSITS, PREPAYMENTS AND OTHER RECEIVABLES
+
+ 
+
+ 
+ 
+ As of 
+ As of 
+
+ 
+ 
+ March 31, 
+2024 
+ September 30, 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Rental and other deposits 
+ $290,814 
+ $1,142,621 
+
+ 
+ Deposit for licenses acquired for events 
+ - 
+ 706,335 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total 
+ $290,814 
+ $1,848,956 
+
+ 
+
+ 
+
+NOTE
+– 12 AMOUNT DUE FROM/(TO) JOINT OPERATION PARTIES
+
+ 
+
+The
+balance represented the amount due from/(to) joint operation parties for co-organizers with profit sharing for the event jointly operated.
+The relevant amount will be settled after the events completed.
+
+ 
+
+ F-21
+
+ 
+
+ 
+
+ 
+
+NOTE
+– 13 INVENTORY
+
+ 
+
+ 
+ 
+ As of 
+ As of 
+
+ 
+ 
+ March 31, 
+2024 
+ September 30, 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Finished goods 
+ $- 
+ $1,493,042 
+
+ 
+
+ 
+
+The
+balance represented finished goods to be sold at upcoming events.
+
+ 
+
+NOTE
+– 14 TRADE AND OTHER PAYABLE
+
+ 
+
+ 
+ 
+ As of 
+ As of 
+
+ 
+ 
+ March 31, 
+2024 
+ September 30, 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Trade payables 
+ $1,390,928 
+ $1,819,381 
+
+ 
+ Accrued salaries 
+ 173,435 
+ 426,651 
+
+ 
+ Other accrued expenses 
+ 9,220 
+ 240,902 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total 
+ $1,573,583 
+ $2,486,934 
+
+ 
+
+ 
+
+An
+aging analysis of the trade and bills payables as at the end of the reporting period, based on the invoice date, is as follows:
+
+ 
+
+ 
+ 
+ As of 
+ As of 
+
+ 
+ 
+ March 31, 
+2024 
+ September 30, 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Within 1 month 
+ $1,287,758 
+ $1,819,381 
+
+ 
+ 1 to 2 months 
+ 103,170 
+ - 
+
+ 
+ Total 
+ $1,390,928 
+ $1,819,381 
+
+ 
+
+ 
+
+NOTE
+– 15 CONTRACT LIABILITIES
+
+ 
+
+As
+of March 31, 2024 and September 30, 2024, contract liabilities amounted HKD3,569,274 and HKD4,671,939, respectively. As of March 31,
+2024, the amount represented advanced payment received from customer based on contract. Payments are usually received in advance before
+performance under the contracts which are mainly for provision of event management services/events to be performed subsequent to the
+balance sheet date. The expected time band for the contracts are within the next 12 months for which the practical expedient in paragraph
+121(a) of IFRS 15 applies. As of September 30, 2024, the receive in advance represented amounts received from co-organizer in advance
+based on the co-organizer agreement, for the event have not started as of September 30, 2024. The expected time for events start is within
+the next 12 months.
+
+ 
+
+ F-22
+
+ 
+
+ 
+
+ 
+
+NOTE
+– 16 NET PROFIT PER CLASS A ORDINARY SHARE
+
+ 
+
+Basic
+net profit per share is computed using the weighted average number of Class A Ordinary Shares outstanding during the period. The
+following table sets forth the computation of basic and diluted net profit per Class A Ordinary Share for the six
+months ended September 30, 2023 and 2024:
+
+ 
+
+ 
+ 
+ Six Months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net profit attributable to ordinary shareholders 
+ $1,355,953 
+ $2,711,539 
+
+ 
+ 
+ 
+ 
+
+ 
+ Weighted average Class A Ordinary Shares outstanding 
+ 
+ 
+
+ 
+ – Basic 
+ 28,660,000 
+ 28,660,000 
+
+ 
+ – Diluted 
+ 29,660,000
+ 
+ 29,660,000
+ 
+
+ 
+ Weighted average Class B Ordinary Shares outstanding – Basic and diluted 
+ 1,000,000
+ 
+ 1,000,000
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net profit per Class A Ordinary Share – Basic 
+ $0.047 
+ $0.095 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net profit per Class A Ordinary
+ Share – diluted
+
+ 
+ $0.046
+ 
+ $0.091
+ 
+
+ 
+
+ 
+
+As Class B Ordinary Shares do not
+have right to dividend. there is no impact when calculated basic net profit per Class A and Class B Ordinary Shares. However, as Class
+B Ordinary Shares have the right to convert into Class A Ordinary Shares, there is dilutive impact during
+the six months ended September 30, 2023 and 2024.
+
+ 
+
+NOTE
+– 17 INTEREST BEARING BANK BORROWINGS
+
+ 
+
+ 
+ 
+ As of 
+ As of 
+
+ 
+ 
+ March 31, 
+2024 
+ September 30, 2024 
+
+ 
+ 
+ HK$ 
+ HK$ 
+
+ 
+ Overdrafts 
+ - 
+ 5,588,324 
+
+ 
+ Bank loans secured and repayable 
+ 
+ 
+
+ 
+ Within 12 months 
+ 642,015 
+ 1,226,176 
+
+ 
+ Over 1 year 
+ 3,093,858 
+ 4,941,240 
+
+ 
+ Total 
+ 3,735,873 
+ 11,755,740 
+
+ 
+
+ 
+
+During
+the year ended March 31, 2024 and six months ended September 30, 2024, the Group entered into loan agreements with a financial institution
+in Hong Kong to borrow loans of HK$1,900,000 and HK$2,877,679, respectively which bears annual interest at a rate of flat rate 5.04%
+and flat rate 5.16% per annum, respectively, with due date in May 2026 and April 2029, respectively. During the six months ended September
+2024, the Group entered into bank facilities agreement with a financial institution in Hong Kong for bank overdrafts and account payable
+financing ("overdrafts") of HKD7,600,000, which bears annual interest at a rate of 1% per annum over prime rate on the outstanding
+amount from the drawn down until repayment in full.
+
+ 
+
+As
+of March 31, 2024 and September 30, 2024, the bank loans and overdrafts of the Company were secured by personal guarantee from Ms. Seto,
+the director and shareholder of the Company.
+
+ 
+
+Interest
+related to the bank loans was HK$116,095 and HK$217,534 for the six months ended March 31, 2023 and 2024, respectively.
+
+ 
+
+Principal
+repayments for bank borrowings to maturity by year are as follows:
+
+ 
+
+ 
+ September 30, 
+ HKD 
+
+ 
+ 2025 
+ $6,814,500 
+
+ 
+ 2026 
+ 1,147,724 
+
+ 
+ Thereafter 
+ 3,793,516 
+
+ 
+ Total 
+ $11,755,740 
+
+ 
+
+ 
+
+NOTE
+– 18 SHAREHOLDERS EQUITY
+
+ 
+
+Authorized
+shares
+
+ 
+
+The
+Company was incorporated in the Cayman Islands with limited liability on July 5, 2024 and the initial 1 fully-paid share was transferred
+to Ms. Seto on the same date for cash at par. The initial authorized share capital of the Company is US$100,000 divided into 1,000,000,000
+Shares of a par value of US$0.0001 each. The details about reorganization subsequent to the balance sheet date is stated in Note 1 and
+Note 23.
+
+ 
+
+The Company has retroactively presented
+all shares and per share data for all periods presented. As a result of the issuances and reclassification stated above, the Company
+had 950,000,000 authorized Class A ordinary shares, par value of US$0.00001, of which 28,660,000 and 28,660,000 Class A ordinary shares
+were issued and outstanding as of September 30, 2023 and 2024, respectively. The Company had 5000,000,000 authorized Class B ordinary
+shares, par value of US$0.00001, of which 1,000,000 and 1,000,000 Class B ordinary shares were issued and outstanding as of September 30,
+2023 and 2024, respectively.
+
+ 
+
+As
+of September 30, 2024, the subscription receivables have yet been paid.
+
+ 
+
+ F-23
+
+ 
+
+ 
+
+ 
+
+NOTE
+– 19 INCOME TAXES
+
+ 
+
+The
+provision for income taxes consisted of the following:
+
+ 
+
+ 
+ 
+ Six Months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Current 
+ $23,000 
+ $350,000 
+
+ 
+ Deferred 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total income tax expense 
+ $23,000 
+ $350,000 
+
+ 
+
+ 
+
+The
+effective tax rate in the years presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range
+of income tax rate. The Company s subsidiaries mainly operate in Hong Kong that are subject to taxes in the jurisdictions in which
+they operate, as follows:
+
+ 
+
+Cayman
+Islands
+
+ 
+
+Under
+the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gain. Additionally, upon payments of dividends
+to the shareholders, no Cayman Islands withholding tax will be imposed.
+
+ 
+
+BVI
+
+ 
+
+LTV
+is considered to be an exempted British Virgin Islands Company and is presently not subject to income taxes or income tax filing requirements
+in the British Virgin Islands.
+
+ 
+
+Hong
+Kong
+
+ 
+
+TIL
+is incorporated in Hong Kong and are subject to Hong Kong Profits Tax on the taxable income as reported in its statutory financial statements
+adjusted in accordance with relevant Hong Kong tax laws. Under the two-tiered profit tax rates regime, the profit tax rate for the first
+$2,000,000 assessable profits arising from Hong Kong of qualifying entities are taxed at 8.25%, and assessable profits arising from Hong
+Kong above $2,000,000 are taxed at the rate of 16.5%. The applicable tax rate is 16.5% in Hong Kong.
+
+ 
+
+The
+reconciliation of income tax rate to the effective income tax rate based on loss before income taxes for the six months ended September
+30, 2023 and 2024 are as follows:
+
+ 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Profit before income taxes 
+ $1,378,953 
+ $3,061,539 
+
+ 
+ Statutory income tax rate 
+ 16.5% 
+ 16.5%
+
+ 
+ Income tax benefit at statutory rate 
+ 227,527 
+ 505,153 
+
+ 
+ Effect of two-tier tax regime 
+ 
+ 
+
+ 
+ Items not subject to taxes 
+ (113,763) 
+ (165,000)
+
+ 
+ Over/(Under) provision of tax 
+ (584) 
+ 6,938 
+
+ 
+ Tax loss from previous periods utilized 
+ (88,085) 
+ - 
+
+ 
+ Temporary timing difference 
+ (2,095) 
+ 2,909 
+
+ 
+ 
+ 
+ 
+
+ 
+ Income tax expense 
+ $23,000 
+ $350,000 
+
+ 
+
+ 
+
+No
+deferred tax assets or liabilities has been recognized in the consolidated financial statements as the Group did not have material temporary
+differences arising between the tax bases of assets and liabilities and their carrying amounts as of March 31, 2024 and September 30,
+2024.
+
+ 
+
+ F-24
+
+ 
+
+ 
+
+ 
+
+Uncertain
+tax positions
+
+ 
+
+The
+Company evaluates the uncertain tax position (including the potential application of interest and penalties) based on the technical merits,
+and measure the unrecognized benefits associated with the tax positions. As of March 31, 2024 and September 30, 2024, the Company did
+not have any significant unrecognized uncertain tax positions. The Company did not incur any interest and penalties related to potential
+underpaid income tax expenses for the years ended March 31, 2024 and September 30, 2024 and also did not anticipate any significant increases
+or decreases in unrecognized tax benefits in the next 12 months from September 30, 2024.
+
+ 
+
+NOTE
+– 20 RELATED PARTY TRANSACTIONS AND BALANCES
+
+ 
+
+The
+related party of the Company with whom transactions are reported in these financial statements are as follows:
+
+ 
+
+ 
+ Name
+ of Individual
+ 
+ Relationship
+ with the Company
+
+ 
+ Ms.
+ Seto Wai Yue
+ 
+ Shareholder
+ and Director of the Company
+
+ 
+ Exit (HK) Limited
+ 
+ Ms.
+ Seto is a 40% shareholder and sole director of Exit (HK)
+
+ 
+ Earthling
+ Catering Limited
+ 
+ Ms.
+ Seto is a 64% shareholder and a director of Earthling 
+
+ 
+ Exit
+ Catering Limited
+
+ Exit Operations Limited
+
+ I
+ Dao Cao Limited
+
+ 
+ Ms.
+ Seto is a 51% shareholder and director of Exit Catering
+
+ Ms.
+ Seto is a 60% shareholder and director of Exit Operations
+
+ Brother
+ of Ms. Seto is the sole shareholder and director of I Dao Cao
+
+ 
+ 
+
+Amount
+due from/(to) a shareholder
+
+ 
+
+ 
+ 
+ As of 
+ As of 
+
+ 
+ 
+ March 31, 
+2024 
+ September 30,
+
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Seto Wai Yue 
+ $2,950,434 
+ $(47,054)
+
+ 
+
+ 
+
+On
+April 10, 2024, Ms. Seto Wai Yue entered into an interest-free loan facility agreement with TIL, for a revolving loan facility agreement
+of up to HK$12,000,000 for the purposes of paying the costs and expenses in connection with the offering. As of September 2024, loan
+amount from Ms. Seto is approximately HK$1.93 million. The balances are unsecured, non-interest bearing, and payable on demand. The balances
+were recorded in current assets/liabilities.
+
+ 
+
+During
+the six months ended September 30, 2023 and 2024, the proceeds and payments to a shareholder are as follows
+
+ 
+
+ 
+ 
+ 
+ September
+ 30,
+
+ 2023
+
+ 
+ 
+ September
+ 30,
+
+ 2024
+ 
+
+ 
+ 
+ 
+ HKD
+ 
+ 
+ HKD
+ 
+
+ 
+ Proceeds
+ from a shareholder
+ 
+ $
+ 1,236,520
+ 
+ 
+ $
+ 7,065,391
+ 
+
+ 
+ Payments
+ to a shareholder
+ 
+ 
+ (1,334,381
+ 
+ )
+ 
+ 
+ (4,067,903
+ )
+
+ 
+ 
+
+Amount
+due from related parties
+
+ 
+
+ 
+ 
+ As of 
+ As of 
+
+ 
+ 
+ March 31, 
+2024 
+ September 30,
+
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ I Dao Cao Limited 
+ - 
+ 879,152 
+
+ 
+ Exit Operations Limited 
+ - 
+ 1,254,369 
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ $- 
+ $2,133,521 
+
+ 
+
+ 
+
+For
+the amount due from I Dao Cao represented deposits for concert tickets for resell. The relevant concert tickets will be delivered before
+the concert commenced. The remaining balance due from Exit Operations Limited represented deposits for caf operation for events
+and will be used up when provision of caf services for upcoming events.
+
+ 
+
+ F-25
+
+ 
+
+ 
+
+ 
+
+Revenue
+
+ 
+
+ 
+ 
+ Six Months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Exit (HK) Limited
+ 
+ 20,000 
+ - 
+
+ 
+ Exit Catering Limited 
+ 207,588 
+ - 
+
+ 
+ Exit Operations Limited 
+ - 
+ 552,166 
+
+ 
+ 
+ $227,588 
+ $552,166 
+
+ 
+
+ 
+
+Cost
+of Revenue
+
+ 
+
+ 
+ 
+ Six Months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ I Dao Cao Limited 
+ - 
+ 204,000 
+
+ 
+ Exit Operations Limited 
+ - 
+ 264,350 
+
+ 
+ 
+ $- 
+ $468,350 
+
+ 
+
+ 
+
+NOTE
+– 21 CONCENTRATIONS OF RISK
+
+ 
+
+The
+Company is exposed to the following concentrations of risk:
+
+ 
+
+(a)
+Major customers
+
+ 
+
+For
+the six months ended September 30, 2023 and 2024, there were individual customer accounts for 10% or more of the Company s revenues
+as stated in note 3 above.
+
+ 
+
+Most
+of the customers are located in Hong Kong.
+
+ 
+
+(b)
+Major vendors
+
+ 
+
+For
+the six months ended September 30, 2023 and 2024, the vendors who accounted for 10% or more of the Company s cost of revenue and
+is presented as follows:
+
+ 
+
+ 
+ Vendors 
+ Percentage of respective fiscal period 
+ Six Months ended September 30, 
+
+ 
+ 
+ 2023 
+ 2024 
+ 2023 
+ 2024 
+
+ 
+ 
+ 
+ 
+ HKD 
+ 
+
+ 
+ Vendor A 
+ 30.7% 
+ 17.5% 
+ $626,892 
+ $3,535,860 
+
+ 
+ Vendor B 
+ 14.6% 
+ 2.1% 
+ 298,629 
+ 418,990 
+
+ 
+ Vendor C 
+ 12.2% 
+ 0.4% 
+ 249,217 
+ 81,650 
+
+ 
+ Vendor D 
+ - 
+ 19.1% 
+ - 
+ 3,851,504 
+
+ 
+
+ 
+
+Most
+of the vendors are located in Hong Kong.
+
+ 
+
+(b)
+Credit risk
+
+ 
+
+Please
+refer to note 2 for details.
+
+ 
+
+ F-26
+
+ 
+
+ 
+
+ 
+
+(c)
+Interest rate risk
+
+ 
+
+As
+the Company has no significant interest-bearing assets, the Company s income and operating cash flows are substantially independent
+of changes in market interest rates.
+
+ 
+
+(d)
+Economic and political risk
+
+ 
+
+The
+Company s major operations are conducted in Hong Kong. Accordingly, the political, economic, and legal environments in Hong Kong,
+as well as the general state of Hong Kong s economy may influence the Company s business, financial condition, and results
+of operations.
+
+ 
+
+(e)
+Liquidity risk
+
+ 
+
+Please
+refer to notes 2, 9 and 17 for details.
+
+ 
+
+NOTE
+– 22 COMMITMENTS AND CONTINGENCIES
+
+ 
+
+The
+Company currently is not aware of any legal proceedings or claims that it believes will have, individually or in the aggregate, a material
+adverse effect on its business, financial condition, operating results, or cash flows.
+
+ 
+
+As
+of March 31, 2024 and September 30, 2024, the Company has no material commitments or contingencies.
+
+ 
+
+NOTE
+– 23 SUBSEQUENT EVENTS
+
+ 
+
+Reorganization
+
+ 
+
+On
+March 6, 2025, Ms. Seto, Ms. Yip and the Company entered into an agreement whereby Ms. Seto and Ms. Yip transferred their entire shareholding
+interest in Trendic to the Company s nominee, Goal Success. The consideration is settled by the Company allotting and issuing 1
+Share to each of Ms. Seto and Kilo Wonders (Ms. Yip s nominee), credited as fully paid and Goal Success allotting and issuing 1
+share to the Company credited as fully paid.
+
+ 
+
+On March 31, 2025
+for purposes of recapitalization in anticipation of the initial public offering, the Company s shareholders passed resolutions
+to (i) sub-divide each of the issued and unissued shares in its share capital of par value US$0.0001 each into 10 shares of par value
+US$0.00001 each, (ii) to re-classify and re-designate its authorised share capital into 10,000,000,000 shares with a par value of US$0.00001
+each comprising of (a) 9,500,000,000 Class A Ordinary Shares with a par value of US$0.00001 each and (b) 500,000,000 Class B Ordinary
+Shares with a par value of US$0.00001 each and (iii) to adopt an amended and restated memorandum of association and articles of association
+reflecting such amended share capital and containing the rights, preferences and privileges attached to each class of shares. Concurrently,
+Ms. Seto, Prime Crest, Fuji Holdings, Kilo Wonders, Yield Rights and Allied Target surrendered 16,303,760, 1,045,660, 960,300, 1,002,980,
+1,045,660 and 981,640 Class A Ordinary Shares to the Company, respectively.
+
+ 
+
+On March 31, 2025, the Company allotted and issued 1,000,000
+Class B Ordinary Shares to Ms. Seto for cash at par, and a resolution was passed on March 31, 2025 giving effect to the same.
+
+ 
+
+Disposal
+of patents and licenses
+
+ 
+
+Subsequent
+to the balance sheet date, the Group signed contracts with two event facilitators to assume his responsibilities and obligations of organizing
+for events to be convened in certain Asian countries by consideration of HK$5.6 million and HK$3 million, respectively.
+
+ 
+
+ F-27
+
+ 
+
+ 
+
+ 
+
+FINANCIAL
+STATEMENTS 
+
+ 
+
+DREAMLAND
+LIMITED AND SUBSIDIARIES
+
+ 
+
+Consolidated
+Financial Statements
+
+For
+The Years Ended March 31, 2023 And 2024
+
+ 
+
+(With
+Report of Independent Registered Public Accounting Firm Thereon)
+
+ 
+
+DREAMLAND
+LIMITED AND SUBSIDIARIES
+
+ 
+
+INDEX
+TO CONSOLIDATED FINANCIAL STATEMENTS
+
+ 
+
+ 
+ 
+ Page
+
+ 
+ 
+ 
+
+ 
+ Report
+ of Independent Registered Public Accounting Firm
+ F-29
+
+ 
+ 
+ 
+
+ 
+ Consolidated
+ Balance Sheets as of March 31, 2023 and 2024
+ F-30
+
+ 
+ 
+ 
+
+ 
+ Consolidated
+ Statements of Operations for the Years ended March 31, 2023 and 2024
+ F-31
+
+ 
+ 
+ 
+
+ 
+ Consolidated
+ Statements of Changes in Shareholders Equity for the Years ended March 31, 2023 and 2024
+ F-32
+
+ 
+ 
+ 
+
+ 
+ Consolidated
+ Statements of Cash Flows for the Years ended March 31, 2023 and 2024
+ F-33
+
+ 
+ 
+ 
+
+ 
+ Notes
+ to Consolidated Financial Statements
+ F-34
+ to F-54
+
+ 
+ 
+
+ F-28
+
+ 
+
+ 
+
+ 
+
+REPORT
+OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
+
+ 
+
+ 
+
+To
+the Board of Directors and
+
+Shareholders
+of Dreamland Limited and its subsidiaries
+
+ 
+
+Opinion
+on the Financial Statements
+
+ 
+
+We
+have audited the accompanying consolidated balance sheets of Dreamland Limited and its subsidiaries (the Company) as of March
+31, 2023 and 2024, and the related consolidated statements of operations, shareholders equity, and cash flows for each
+of the two years in the period ended March 31, 2024, and the related notes, collectively referred to as the financial statements. In
+our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of March 31,
+2023 and 2024, and the results of its operations and its cash flows for each of the two years in the period ended March 31, 2024, in
+conformity with International Financial Reporting Standards as issued by International Accounting Standards Board.
+
+ 
+
+Basis
+for Opinion
+
+ 
+
+These
+financial statements are the responsibility of the Company s management. Our responsibility is to express an opinion on the Company s
+financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board
+(United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities
+laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
+
+ 
+
+We
+conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain
+reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company
+is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits,
+we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion
+on the effectiveness of the Company s internal control over financial reporting. Accordingly, we express no such opinion.
+
+ 
+
+Our
+audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error
+or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding
+the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant
+estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits
+provide a reasonable basis for our opinion.
+
+ 
+
+/s/
+TAAD LLP
+
+ 
+
+We
+have served as the Company s auditor since 2024.
+
+ 
+
+Diamond
+Bar, California
+
+ 
+
+October
+17, 2024, except for Notes 1, 14, 16 and 21, as to which the date is April 10, 2025
+
+ 
+
+ F-29
+
+ 
+
+ 
+
+ 
+
+DREAMLAND
+LIMITED AND SUBSIDIARIES
+
+CONSOLIDATED
+BALANCE SHEETS
+
+ 
+
+ 
+ 
+ 
+ As
+ of March 31, 
+
+ 
+ 
+ Note 
+ 2023 
+ 2024 
+
+ 
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ ASSETS 
+ 
+ 
+ 
+
+ 
+ Equipment, net 
+ 8 
+ - 
+ 135,892 
+
+ 
+ Right-of-use assets 
+ 9 
+ 471,363 
+ 789,369 
+
+ 
+ Non-current
+ assets 
+ 
+ 471,363 
+ 925,261 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Current assets: 
+ 
+ 
+ 
+
+ 
+ Contract assets 
+ 6 
+ $- 
+ $4,337,713 
+
+ 
+ Accounts receivable, net 
+ 7 
+ - 
+ 826,687 
+
+ 
+ Deposits, prepayments and other receivables 
+ 10 
+ 139,495 
+ 290,814 
+
+ 
+ Amount due from a shareholder 
+ 
+ 4,747,823 
+ 2,950,434 
+
+ 
+ Cash and bank balances 
+ 
+ 328,214 
+ 3,817,083 
+
+ 
+ Total
+ current assets 
+ 
+ 5,215,532 
+ 12,222,731 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL
+ ASSETS 
+ 
+ $5,686,895 
+ $13,147,992 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Non-current liabilities: 
+ 
+ 
+ 
+
+ 
+ Bank borrowings 
+ 15 
+ 3,735,873 
+ 3,093,858 
+
+ 
+ Lease liabilities 
+ 9 
+ 254,357 
+ 601,853 
+
+ 
+ Total
+ non-current liabilities 
+ 
+ 3,990,230 
+ 3,695,711 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Current liabilities: 
+ 
+ 
+ 
+
+ 
+ Bank borrowings, current portion 
+ 15 
+ $503,180 
+ $642,015 
+
+ 
+ Lease liabilities, current portion 
+ 9 
+ 144,074 
+ 178,001 
+
+ 
+ Tax payable 
+ 17 
+ - 
+ 988,347 
+
+ 
+ Trade and other payables 
+ 11 
+ 137,224 
+ 1,573,583 
+
+ 
+ Contract liabilities 
+ 12 
+ - 
+ 3,569,274 
+
+ 
+ Total
+ current liabilities 
+ 
+ 784,478 
+ 6,951,220 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL
+ LIABILITIES 
+ 
+ $4,774,708 
+ $10,646,931 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ SHAREHOLDERS EQUITY 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Class A Ordinary Shares
+ US$0.00001 par value authorized shares 9,500,000,000 shares as of March 31, 2023 and 2024; 28,660,000 shares
+ issued and outstanding as of March 31, 2023 and 2024* 
+ 16 
+ 2,233 
+ 2,233 
+
+ 
+ Class B Ordinary Shares US$0.00001 par value authorized shares 500,000,000
+ shares as of March 31, 2023 and 2024; 1,000,000 shares issued and outstanding as of March 31, 2023 and 2024* 
+ 16 
+ 78
+ 
+ 78
+ 
+
+ 
+ Subscription receivables 
+ 16 
+ (3,974) 
+ (3,974)
+
+ 
+ Reserves 
+ 
+ 2,011,663 
+ 2,011,663 
+
+ 
+ (Accumulated deficit)/retained
+ earnings 
+ 
+ (1,097,813) 
+ 491,061 
+
+ 
+ TOTAL
+ SHAREHOLDERS EQUITY 
+ 
+ $912,187 
+ $2,501,061 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ TOTAL
+ SHAREHOLDERS EQUITY AND LIABILITIES 
+ 
+ $5,686,895 
+ $13,147,992 
+
+ 
+
+ 
+
+*
+The shares amounts are presented on a retroactive basis.
+
+ 
+
+See
+accompanying notes to consolidated financial statements.
+
+ 
+
+ F-30
+
+ 
+
+ 
+
+ 
+
+DREAMLAND
+LIMITED AND SUBSIDIARIES
+
+CONSOLIDATED
+STATEMENTS OF OPERATIONS 
+
+ 
+
+ 
+ 
+ 
+ Year
+ Ended March 31, 
+
+ 
+ 
+ Note 
+ 2023 
+ 2024 
+
+ 
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Revenues 
+ 
+ $1,137,909 
+ $20,103,097 
+
+ 
+ Revenues,
+ related party 
+ 
+ 2,477,228 
+ 337,586 
+
+ 
+ Total Revenues, net 
+ 3 
+ 3,615,137 
+ 20,440,683 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Costs and expenses: 
+ 
+ 
+ 
+
+ 
+ Cost of revenue 
+ 
+ (3,262,588) 
+ (11,360,489)
+
+ 
+ General and administrative expenses 
+ 5 
+ (490,636) 
+ (666,286)
+
+ 
+ Depreciation 
+ 
+ (206,006) 
+ (294,083)
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Profit/(Loss)
+ from operations 
+ 
+ (344,093) 
+ 8,119,825 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Other income/(expenses): 
+ 
+ 
+ 
+
+ 
+ Interest income 
+ 
+ 441 
+ 22,995 
+
+ 
+ Finance costs 
+ 
+ (179,651) 
+ (246,262)
+
+ 
+ Other income 
+ 
+ 40,520 
+ 180,663 
+
+ 
+ Total other income/(expenses),
+ net 
+ 4 
+ (138,690) 
+ (42,604)
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Profit/(Loss)
+ before income taxes 
+ 
+ (482,783) 
+ 8,077,221 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Income tax expense 
+ 17 
+ - 
+ (988,347)
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ NET
+ PROFIT/(LOSS) 
+ 
+ $(482,783) 
+ $7,088,874 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Profit/(Loss) per Class
+ A Ordinary Share: 
+ 14 
+ 
+ 
+
+ 
+ -
+ Basic* 
+ 
+ $(0.017) 
+ $0.247 
+
+ 
+ -
+ Diluted* 
+ 
+ $(0.016) 
+ $0.239 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Weighted average number
+ of Class A Ordinary Shares 
+ 
+ 
+ 
+
+ 
+ - Basic* 
+ 
+ 28,660,000 
+ 28,660,000 
+
+ 
+ - Diluted*
+
+ 
+ 
+ 29,660,000
+ 
+ 29,660,000
+ 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Weighted average number of Class B Ordinary Shares 
+ 
+ 
+ 
+
+ 
+ - Basic and diluted* 
+ 
+ 1,000,000
+ 
+ 1,000,000
+ 
+
+ 
+
+ 
+
+*
+The shares amounts are presented on a retroactive basis.
+
+ 
+
+See
+accompanying notes to consolidated financial statements.
+
+ 
+
+ F-31
+
+ 
+
+ 
+
+ 
+
+DREAMLAND
+LIMITED AND SUBSIDIARIES
+
+CONSOLIDATED
+STATEMENTS OF CHANGES IN SHAREHOLDERS 
+EQUITY
+
+ 
+
+ 
+ 
+ Class A Ordinary
+ Shares* 
+ Class B Ordinary
+ Shares* 
+ 
+ 
+ (Accumulated 
+ Total 
+
+ 
+ 
+ Number 
+of 
+shares 
+ Amount 
+ Number 
+of 
+shares 
+ Amount 
+ 
+Subscription
+ Receivables 
+ 
+ Capital Reserve 
+ Deficit)/ 
+Retained Earnings 
+ shareholders 
+ Equity 
+
+ 
+ 
+ 
+ HKD 
+ 
+ HKD 
+ 
+ 
+ 
+ 
+
+ 
+ Balance as of April 1, 2022 
+ 28,660,000 
+ $2,233 
+ 1,000,000 
+ $78 
+ $(3,974) 
+ $2,011,663 
+ $(615,030) 
+ $1,394,970 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Net loss 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ (482,783) 
+ (482,783)
+
+ 
+ Balance as of March 31, 2023 
+ 28,660,000 
+ $2,233 
+ 1,000,000 
+ $78 
+ $(3,974) 
+ $2,011,663 
+ $(1,097,813) 
+ $912,187 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Net Profit 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ 7,088,874 
+ 7,088,874 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Dividend 
+ - 
+ - 
+ - 
+ - 
+ - 
+ - 
+ (5,500,000) 
+ (5,500,000)
+
+ 
+ Balance as of March 31, 2024 
+ 28,660,000 
+ $2,233 
+ 1,000,000 
+ $78 
+ $(3,974) 
+ $2,011,663 
+ $491,061 
+ $2,501,061 
+
+ 
+ 
+
+*
+The shares amounts are presented on a retroactive basis.
+
+ 
+
+See
+accompanying notes to consolidated financial statements.
+
+ 
+
+ F-32
+
+ 
+
+ 
+
+ 
+
+DREAMLAND
+LIMITED AND SUBSIDIARIES
+
+CONSOLIDATED
+STATEMENTS OF CASH FLOWS
+
+ 
+
+ 
+ 
+ Year
+ ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Cash flows from operating
+ activities: 
+ 
+ 
+
+ 
+ Net Profit/(Loss) before tax 
+ $(482,783) 
+ $8,077,221 
+
+ 
+ Adjustments to reconcile net profit/(loss)
+ to net cash provided by operating activities 
+ 
+ 
+
+ 
+ Interest income 
+ (441) 
+ (22,995)
+
+ 
+ Finance costs 
+ 179,651 
+ 246,262 
+
+ 
+ Depreciation of equipment 
+ 1,000 
+ 5,908 
+
+ 
+ Depreciation of right of use assets 
+ 205,006 
+ 288,175 
+
+ 
+ Loss/(Gain) on early termination of leases 
+ 7,480 
+ (2,539)
+
+ 
+ Change in operating assets and liabilities: 
+ 
+ 
+
+ 
+ Contract assets 
+ - 
+ (4,337,713)
+
+ 
+ Trade receivable 
+ - 
+ (826,687)
+
+ 
+ Deposits, prepayments and other receivables 
+ (139,495) 
+ (151,319)
+
+ 
+ Trade payable and other payable 
+ (10,231) 
+ 1,436,359 
+
+ 
+ Contract liabilities 
+ - 
+ 3,569,274 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net cash provided by/(used
+ in) operating activities 
+ (239,813) 
+ 8,281,946 
+
+ 
+ 
+ 
+ 
+
+ 
+ Cash flows from investing
+ activities: 
+ 
+ 
+
+ 
+ Interest received 
+ 441 
+ 22,995 
+
+ 
+ Disposal of motor vehicle 
+ - 
+ 7,945 
+
+ 
+ Purchases of equipment 
+ - 
+ (141,800)
+
+ 
+ 
+ 
+ 
+
+ 
+ Net
+ cash provided by/(used in) investing activities 
+ 441 
+ (110,860)
+
+ 
+ 
+ 
+ 
+
+ 
+ Cash flows from financing
+ activities: 
+ 
+ 
+
+ 
+ Proceeds from a shareholder 
+ 793,266 
+ 18,039,849 
+
+ 
+ Payments to a shareholder 
+ (4,362,363) 
+ (21,742,460)
+
+ 
+ Proceeds from bank borrowings 
+ 4,573,000 
+ - 
+
+ 
+ Repayment of bank borrowings – principal 
+ (333,947) 
+ (503,180)
+
+ 
+ Repayment of bank borrowings – interest 
+ (163,628) 
+ (221,892)
+
+ 
+ Repayment of leases liabilities –
+ principal 
+ (257,967) 
+ (230,164)
+
+ 
+ Repayment of leases
+ liabilities – interest 
+ (16,023) 
+ (24,370)
+
+ 
+ 
+ 
+ 
+
+ 
+ Net
+ cash provided by/(used in) financing activities 
+ 232,338 
+ (4,682,217)
+
+ 
+ 
+ 
+ 
+
+ 
+ Net change in cash and
+ bank balances 
+ (7,034) 
+ 3,488,869 
+
+ 
+ 
+ 
+ 
+
+ 
+ BEGINNING OF YEAR 
+ 335,248 
+ 328,214 
+
+ 
+ 
+ 
+ 
+
+ 
+ END OF YEAR 
+ $328,214 
+ $3,817,083 
+
+ 
+ 
+ 
+ 
+
+ 
+ SUPPLEMENTAL CASH FLOW
+ INFORMATION: 
+ 
+ 
+
+ 
+ Cash paid for income
+ taxes 
+ $- 
+ $- 
+
+ 
+ Cash paid for interest 
+ $(179,651) 
+ $(247,430)
+
+ 
+ 
+ 
+ 
+
+ 
+ SUPPLEMENTAL NON-CASH
+ INVESTING AND FINANCING ACTIVITIES: 
+ 
+ 
+
+ 
+ Dividend offset amount
+ due from a shareholder 
+ $- 
+ $5,500,000 
+
+ 
+
+ 
+
+See
+accompanying notes to consolidated financial statements.
+
+ 
+
+ F-33
+
+ 
+
+ 
+
+ 
+
+DREAMLAND
+LIMITED AND SUBSIDIARIES
+
+NOTES
+TO CONSOLIDATED FINANCIAL STATEMENTS
+
+ 
+
+NOTE 1
+BUSINESS OVERVIEW AND BASIS OF PRESENTATION
+
+ 
+
+Dreamland
+Limited, or the Company is incorporated under the laws of the Cayman Islands with limited liability on July 5, 2024. The Company,
+through its subsidiaries, collectively referred to as the Group, are mainly engaged in the provision of design, products
+sales and event management services.
+
+ 
+
+Description
+of subsidiaries incorporated and controlled by the Company
+
+ 
+
+ 
+ Name
+ 
+ Background
+ 
+ Effective
+ ownership
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Goal
+ Success Limited, or Goal Success
+ 
+ 
+ British
+ Virgin Islands company
+ 
+ 100%
+ owned by Dreamland
+
+ 
+ 
+ 
+ Incorporated
+ on July 25, 2024
+ 
+ 
+
+ 
+ 
+ 
+ Issued
+ and outstanding 1 ordinary share for USD 1
+ 
+ 
+
+ 
+ 
+ 
+ Investment
+ holding
+ 
+ 
+
+ 
+ 
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Trendic
+ International Limited, or TIL
+ 
+ 
+ Hong
+ Kong company
+ 
+ 100%
+ owned by Goal Success
+
+ 
+ 
+ 
+ Incorporated
+ on April 11, 2016
+ 
+ 
+
+ 
+ 
+ 
+ Issued
+ and paid up Ordinary Shares without par value of 20,000 shares for HK$2,010,000
+ 
+ 
+
+ 
+ 
+ 
+ Provision
+ of design, merchandised sales and event management services
+ 
+ 
+
+ 
+ 
+
+Reorganization
+
+ 
+
+Since July 5, 2024, the Company completed
+several transactions for the purposes of a group reorganization.
+
+ 
+
+Prior to a group reorganization,
+TIL was held as to 95.3% by Ms. Seto and 4.7% by Ms. Yip Ka Ki Cherry. For details, please refer to section History and Corporate Structure
+of this prospectus. Upon completion of the reorganization, Ms. Seto, a controlling shareholder, and Ms. Yip ultimately owns 76.4% and
+4.7% Class A Ordinary Shares shareholding of the Company, respectively, and 100% and nil Class B Ordinary Shares shareholding
+of the Company, respectively. Goal Success and TIL become indirectly owned subsidiaries of the Company.
+
+ 
+
+During the years presented
+in these consolidated financial statements, the control of these entities has been demonstrated by Ms. Seto, as if the reorganization
+had taken place at the beginning of the earlier date presented. Accordingly, the consolidation has been treated as a corporate
+restructuring, or Reorganization, of entities under common control and thus the current capital structure has been retroactively presented
+in prior periods as if such structure existed at that time, the entities under common control are presented on a consolidated
+basis for all periods to which such entities were under common control. The consolidation of the Company and its subsidiaries
+has been accounted for at historical cost and prepared on the basis as if the aforementioned transactions had become effective as of
+the beginning of the first period presented in the accompanying consolidated financial statements.
+
+ 
+
+ F-34
+
+ 
+
+ 
+
+ 
+
+NOTE 2
+SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 
+
+ 
+
+These
+accompanying consolidated financial statements reflect the application of certain significant accounting policies as described
+in this note and elsewhere in the accompanying consolidated financial statements and notes.
+
+ 
+
+ 
+ 
+ Basis
+ of Presentation
+
+ 
+ 
+
+These
+financial statements have been prepared in accordance with International Financial Reporting Standards and International Accounting Standards
+as issued by the International Accounting Standards Board (IASB) and Interpretations (collectively IFRS Accounting Standards).
+
+ 
+
+The
+preparation of financial statements in compliance with adopted IFRS Accounting Standards requires the use of certain accounting estimates.
+It also requires Group management to exercise judgment in applying the Group s accounting policies.
+
+ 
+
+Changes
+in accounting policies 
+
+ 
+
+ 
+ a)
+ New
+ standards, interpretations and amendments adopted from January 1, 2023
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ The
+ following amendments are effective for the period beginning January 1, 2023:
+
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Disclosure
+ of Accounting Policies (Amendments to IAS 1 Presentation of Financial Statements and IFRS Practice Statement 2 Making Materiality
+ Judgements);
+
+ 
+ 
+ 
+ Definition
+ of Accounting Estimates (Amendments to IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors);
+
+ 
+ 
+ 
+ Deferred
+ Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12 Income Taxes); and
+
+ 
+ 
+ 
+ International
+ Tax Reform – Pillar Two Model Rules (Amendment to IAS 12 Income Taxes) (effective immediately upon the issue of the
+ amendments and retrospectively).
+
+ 
+ 
+
+These
+amendments to various IFRS Accounting Standards are mandatorily effective for reporting periods beginning on or after January 1, 2023.
+See the applicable notes for further details on how the amendments affected the Group.
+
+ 
+
+Disclosure
+of Accounting Policies (Amendments to IAS 1 Presentation of Financial Statements and IFRS Practice Statement 2 Making Materiality Judgements)
+
+ 
+
+In
+February 2021, the IASB issued amendments to IAS 1 and IFRS Practice Statement 2. The amendments aim to make accounting policy disclosures
+more informative by replacing the requirement to disclose , ' ': significant accounting policies with , ' ': material accounting
+policy information . The amendments also provide guidance under what circumstance, the accounting policy information is likely
+to be considered material and therefore requiring disclosure.
+
+ 
+
+These
+amendments have no effect on the measurement or presentation of any items in the consolidated financial statements of the Group
+but affect the disclosure of accounting policies of the Group.
+
+ 
+
+ F-35
+
+ 
+
+ 
+
+ 
+
+a)
+New standards, interpretations and amendments adopted from 1 January 2023 (continued)
+
+ 
+
+Definition
+of Accounting Estimates (Amendments to IAS 8 Accounting policies, Changes in Accounting Estimates and Errors)
+
+ 
+
+The
+amendments to IAS 8, which added the definition of accounting estimates, clarify that the effects of a change in an input or measurement
+technique are changes in accounting estimates, unless resulting from the correction of prior period errors. These amendments clarify
+how entities make the distinction between changes in accounting estimate, changes in accounting policy and prior period errors.
+
+ 
+
+These
+amendments had no effect on the consolidated financial statements of the Group.
+
+ 
+
+Deferred
+Tax related to Assets and Liabilities arising from a Single Transaction (Amendments to IAS 12 Income Taxes)
+
+ 
+
+In
+May 2021, the IASB issued amendments to IAS 12, which clarify whether the initial recognition exemption applies to certain transactions
+that result in both an asset and a liability being recognized simultaneously (e.g. a lease in the scope of IFRS 16). The amendments introduce
+an additional criterion for the initial recognition exemption, whereby the exemption does not apply to the initial recognition of an
+asset or liability which at the time of the transaction, gives rise to equal taxable and deductible temporary differences.
+
+ 
+
+These
+amendments had no effect on the annual consolidated financial statements of the Group.
+
+ 
+
+International
+Tax Reform – Pillar Two Model Rules (Amendment to IAS 12 Income Taxes)
+
+ 
+
+In December 2021, the Organization
+for Economic Co-operation and Development (OECD) released a draft legislative framework for a global minimum tax that is expected to
+be used by individual jurisdictions. The goal of the framework is to reduce the shifting of profit from one jurisdiction to another in
+order to reduce global tax obligations in corporate structures. In March 2022, the OECD released detailed technical guidance on Pillar
+Two of the rules.
+
+ 
+
+Stakeholders raised concerns with
+the IASB about the potential implications on income tax accounting, especially accounting for deferred taxes, arising from the Pillar
+Two model rules. The IASB issued the final Amendments (the Amendments) International Tax Reform – Pillar Two Model Rules, in response
+to stakeholder concerns on May 23, 2023.
+
+ 
+
+The Amendments introduce a mandatory
+exception to entities from the recognition and disclosure of information about deferred tax assets and liabilities related to Pillar
+Two model rules. The exception is effective immediately and retrospectively. The Amendments also provide for additional disclosure requirements
+with respect to an entity s exposure to Pillar Two income taxes.
+
+ 
+
+Management of A Layout has determined
+that the Group is not within the scope of OECD s Pillar Two Model Rules and the exception to the recognition and disclosure of
+information about deferred tax assets and liabilities related to Pillar Two income taxes is not applicable to the Group.
+
+ 
+
+ F-36
+
+ 
+
+ 
+
+ 
+
+b)
+New standards, interpretations and amendments not yet effective
+
+ 
+
+There
+are a number of standards, amendments to standards, and interpretations which have been issued by the IASB that are effective in future
+accounting periods that the Group has decided not to adopt early.
+
+ 
+
+The
+following amendments are effective for the period beginning January 1, 2024:
+
+ 
+
+ 
+ 
+ 
+ Liability
+ in a Sale and Leaseback (Amendments to IFRS 16 Leases);
+
+ 
+ 
+ 
+ Classification
+ of Liabilities as Current or Non-Current (Amendments to IAS 1 Presentation of Financial Statements);
+
+ 
+ 
+ 
+ Non-current
+ Liabilities with Covenants (Amendments to IAS 1 Presentation of Financial Statements); and
+
+ 
+ 
+ 
+ Supplier
+ Finance Arrangements (Amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures)
+
+ 
+ 
+
+The
+following amendments are effective for the period beginning January 1, 2025:
+
+ 
+
+ 
+ 
+ 
+ Lack
+ of Exchangeability (Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates)
+
+ 
+ 
+
+The
+Group is currently assessing the impact of these new accounting standards and amendments. The Group does not believe that the amendments
+to IAS 1 will have a significant impact on the classification of its liabilities. The Group does not expect any other standards issued
+by the IASB, but are yet to be effective, to have a material impact on the Group.
+
+ 
+
+ 
+ 
+ Basis
+ of Consolidation
+
+ 
+ 
+
+The consolidated
+financial statements include the financial statements
+of the Company and its subsidiaries. All significant inter-company balances and transactions within the Company
+have been eliminated upon consolidation.
+
+ 
+
+ 
+ 
+ Use
+ of Estimates and Assumptions
+
+ 
+ 
+
+The
+preparation of consolidated financial statements in conformity with IFRS Accounting Standards require management to make estimates
+and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of
+the date of the consolidated financial statements and the reported amounts of revenues and expenses during the periods presented.
+Significant accounting estimates in the period include
+the revenue recognition for provision of event management services, allowance for doubtful accounts on accounts, and provision for income
+tax. Actual results may differ from these estimates.
+
+ 
+
+ 
+ 
+ Foreign
+ Currency Translation and Transaction
+
+ 
+ 
+
+The
+Company uses Hong Kong Dollars as its reporting currency. The functional currency of the Group is Hong Kong Dollar. All amounts have
+been rounded to the nearest thousand, unless otherwise indicated.
+
+ 
+
+Monetary
+assets and liabilities denominated in currencies other than the applicable functional currencies are translated into the functional currencies
+at the prevailing rates of exchange at the balance sheet date. Nonmonetary assets and liabilities are remeasured into the applicable
+functional currencies at historical exchange rates.
+
+ 
+
+Transactions
+denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing
+at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated
+into the functional currency using the applicable exchange rates at the balance sheet dates. Translation gains and losses that arise
+from exchange rate fluctuations from transactions denominated in a currency other than the functional currency are translated, as the
+case may be, at the rate on the date of the transaction and included in the results of operations as incurred.
+
+ 
+
+ F-37
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Cash
+ and Cash in Bank
+
+ 
+ 
+
+Cash
+and cash in bank consist primarily of cash in readily available checking and saving accounts. The
+Company maintains most of its bank accounts in Hong Kong.
+
+ 
+
+ 
+ 
+ Accounts
+ Receivable and Allowance for Doubtful Accounts
+
+ 
+ 
+
+Accounts
+receivable include trade accounts due from customers in the rendering of service. 
+
+ 
+
+Accounts
+receivable are recorded at the invoiced amount and do not bear interest, which are due upon invoice was presented. The Company seeks
+to maintain strict control over its outstanding receivables to minimize credit risk. Overdue balances are reviewed regularly by senior
+management. Management reviews its receivables on a regular basis to determine if the bad debt allowance is adequate and provides allowance
+when necessary. The allowance is based on management s best estimates of specific losses on individual customer exposures, as well
+as the historical trends of collections. Account balances are charged off against the allowance after all means of collection have been
+exhausted and the likelihood of collection is not probable. The Company s management continues to evaluate the reasonableness of
+the valuation allowance policy and update it if necessary.
+
+ 
+
+The
+Company does not hold any collateral or other credit enhancements overs its accounts receivable balances.
+
+ 
+
+ 
+ 
+ Lease
+
+ 
+ 
+
+The
+Group assesses at contract inception whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract
+conveys the right to control the use of an identified asset for a period of time in exchange for consideration.
+
+ 
+
+Group
+as a lessee
+
+ 
+
+The
+Group applies a single recognition and measurement approach for all leases, except for short-term leases and leases of low-value assets.
+The Group recognizes lease liabilities to make lease payments and right-of-use assets representing the right to use the underlying assets.
+
+ 
+
+ 
+ (a)
+ Right-of-use
+ assets
+
+ 
+ 
+
+Right-of-use
+assets are recognized at the commencement date of the lease (that is the date the underlying asset is available for use). Right-of-use
+assets are measured at cost, less any accumulated depreciation and any impairment losses, and adjusted for any remeasurement
+of lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities recognized, initial direct costs incurred,
+and lease payments made at or before the commencement date less any lease incentives received. Right-of-use assets are depreciated on
+a straight-line basis over the shorter of the lease terms and the estimated useful lives of the assets as follows:
+
+ 
+
+ 
+ 
+ Office
+ premises
+ based
+ on lease terms
+
+ 
+ 
+ Motor
+ vehicles
+ 3
+ years
+
+ 
+ 
+
+ F-38
+
+ 
+
+ 
+
+ 
+
+Lease
+(continued)
+
+ 
+
+Group
+as a lessee (continued)
+
+ 
+
+If
+ownership of the leased asset transfers to the Group by the end of the lease term or the cost reflects the exercise of a purchase option,
+depreciation is calculated using the estimated useful life of the asset.
+
+ 
+
+ 
+ (b)
+ Lease
+ liabilities
+
+ 
+ 
+ 
+
+ 
+ 
+ Lease
+ liabilities are recognized at the commencement date of the lease at the present value of lease payments to be made over the lease
+ term. The lease payments include fixed payments (including in- substance fixed payments) less any lease incentives receivable, variable
+ lease payments that depend on an index or a rate, and amounts expected to be paid under residual value guarantees. The lease payments
+ also include the exercise price of a purchase option reasonably certain to be exercised by the Group and payments of penalties for
+ termination of a lease, if the lease term reflects the Group exercising the option to terminate the lease. The variable lease payments
+ that do not depend on an index or a rate are recognized as an expense in the period in which the event or condition that triggers
+ the payment occurs.
+
+ 
+ 
+ 
+
+ 
+ 
+ In
+ calculating the present value of lease payments, the Group uses its incremental borrowing rate at the lease commencement date because
+ the interest rate implicit in the lease is not readily determinable. After the commencement date, the amount of lease liabilities
+ is increased to reflect the accretion of interest and reduced for the lease payments made. In addition, the carrying amount of lease
+ liabilities is remeasured if there is a modification, a change in the lease term, a change in lease payments (e.g., a change to future
+ lease payments resulting from a change in an index or rate) or a change in assessment of an option to purchase the underlying asset.
+
+ 
+ 
+ 
+
+ 
+ (c)
+ Short-term
+ leases and leases of low-value assets
+
+ 
+ 
+ 
+
+ 
+ 
+ The
+ Group applies the short-term lease recognition exemption to its short-term leases of equipment (that is those leases that have a
+ lease term of 12 months or less from the commencement date and do not contain a purchase option). It also applies the recognition
+ exemption for leases of low-value assets to leases of office equipment that are considered to be of low value.
+
+ 
+ 
+ 
+
+ 
+ 
+ Lease
+ payments on short-term leases and leases of low-value assets are recognized as an expense on a straight-line basis over the lease
+ term.
+
+ 
+ 
+
+ 
+ 
+ Equipment
+
+ 
+ 
+
+Equipment
+are stated at cost less accumulated depreciation and accumulated impairment losses, if any. Depreciation is calculated on the straight-line
+basis over the following expected useful lives from the date on which they become fully operational and after taking into account their
+estimated residual values:
+
+ 
+
+ 
+ 
+ Expected
+ useful life
+
+ 
+ Leasehold
+ improvement
+ The
+ lower of lease term or useful life
+
+ 
+ 
+
+Expenditure
+for repairs and maintenance is expensed as incurred. When assets have retired or sold, the cost and related accumulated depreciation
+are removed from the accounts and any resulting gain or loss is recognized in the results of operations.
+
+ 
+
+ F-39
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Revenue
+ Recognition
+
+ 
+ 
+
+The
+Company adopted Accounting Standards Revenue
+from Contracts with Customers (IFRS 15), which provided the following overview of how revenue is recognized from the Company s
+contracts with customers: The Company recognizes revenue to depict the transfer of promised goods or services to customers in an amount
+that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services.
+
+ 
+
+Step
+1: Identify the contract(s) with a customer.
+
+ 
+
+Step
+2: Identify the performance obligations in the contract.
+
+ 
+
+Step
+3: Determine the transaction price – The transaction price is the amount of consideration in a contract to which an entity expects
+to be entitled in exchange for transferring promised goods or services to a customer.
+
+ 
+
+Step
+4: Allocate the transaction price to the performance obligations in the contract – Any entity typically allocates the transaction
+price to each performance obligation on the basis of the relative standalone selling prices of each distinct good or service promised
+in the contract.
+
+ 
+
+Step
+5: Recognize revenue when (or as) the entity satisfies a performance obligation – An entity recognizes revenue when (or as) it
+satisfies a performance obligation by transferring a promised good or service to a customer (which is when the customer obtains control
+of that good or service). The amount of revenue recognized is the amount allocated to the satisfied performance obligation. A performance
+obligation may be satisfied at a point in time (typically for promises to transfer goods to a customer) or over time (typically for promises
+to transfer service to a customer).
+
+ 
+
+The Company identified the following
+three types of performances under the event management contract: i) events planning, design, development and operation, or the Event
+Management Services; ii) Procurement and sales of goods to customer; iii) sponsorship commission income. The Company s revenue
+is derived from contracts with customers in the rendering of Event Management Services, and as such, the revenue recognized depicts the
+transfer of promised services to its customers in an amount that reflects the consideration to which the Company expects to be entitled
+in exchange for those services when the events start. The Company considers the terms of the contract and all relevant facts and circumstances
+when applying this guidance. The duration of the service period is usually less than one year. The Company recognize Event Management
+Services revenue when the event starts and during the event period ratably because: i) Based on the contract terms, none of parties that
+entered into the contract can terminate, and find other vendors to substitute the services; ii) And the customer benefits from our service
+beginning at the point of the event started to the event completion. The Company generally requires the customers to make the advanced
+payment at certain percentage of the total contract value upon signing the agreement. Contract liabilities are recorded when the advanced
+payment is received from the customers before all of the relevant criteria for revenue recognition has been met. The event management
+contract price is lump sum basis, consisted of sales of goods and Event Management Services consideration. For allocation of transaction
+price of sales of goods and Event Management Services, the company applied cost plus margin method to determine the sales of goods revenue
+based on standalone sales of goods gross margin, and allocate the remaining provision consideration into event management services. For
+sponsorship commission income, there is specified percentage calculation based on sponsorship fee raised (if any).
+
+ 
+
+For sponsorship commission income,
+it is sponsorship for the whole event period and recognized over the event period align with Event Management Services.
+
+ 
+
+Revenue from sales of goods is recognized at
+a point in time when control of the goods has been transferred to the customers. Control is primarily evidenced by taking physical possession
+and inventory risk of the goods. The Group controls the goods and determines the selling price or allocated selling price (under event
+management services contracts) of the good before the good is transferred to the customers.
+
+ 
+
+Revenue
+from designed services is recognized over the time. The revenue generated from design services are generally based on the fixed
+fee billing arrangements that require the clients to pay a pre-established fee in exchange for a predetermined set of design services.
+The design services provide involve a series of tasks which are distinct and meet the criteria for recognizing revenue overtime. In addition,
+the Group concludes that the services provided each month are substantially similar and result in the transfer of substantially similar
+services to the clients each month. The Group recognizes revenues from design services on a monthly basis when it satisfies its performance
+obligations throughout the contract terms. Due to the design works were performed by inhouse designer and/or monitored by in-house designer
+through external designer (value added services), the Company controls the specified designed services before that services are transferred
+to a customer and thus, the Company is principal instead of agent for design services. based on the facts above and the company will
+determine the selling price.
+
+ 
+
+ F-40
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Cost
+ of Revenue
+
+ 
+ 
+
+Direct
+cost of revenues mainly consists of subcontracting to event facilitators, front line staff costs, cost of goods sold which are attributable
+to the revenue-generating activities of the Group provides for its clients,
+
+ 
+
+ 
+ Contract
+ costs
+
+ 
+
+A
+contract cost represents cost incurred to fulfil a contract with a customer. Contract cost is capitalized as an asset if all of
+the following criteria are met:
+
+ 
+
+(a)
+The cost relates directly to a contract or to an anticipated contract that the entity can specifically identify;
+
+ 
+
+(b)
+The cost generates or enhances resources of the entity that will be used in satisfying (or in continuing to satisfy) performance obligations
+in the future;
+
+ 
+
+(c)
+The cost is expected to be recovered
+
+ 
+
+The
+capitalized contract cost is amortized and charged to the statement of profit or loss on a systematic basis that is consistent
+with the pattern of the revenue to which the asset related is recognized.
+
+ 
+
+ 
+ Contract
+ liabilities
+
+ 
+
+A
+contract liability is recognized when a payment is received or a payment is due (whichever is earlier) from a customer before the Group
+transfers the related goods or services. Contract liabilities are recognized as revenue when the Group performs under the contract (i.e.,
+transfers control of the related goods or services to the customer).
+
+ 
+
+ 
+ 
+ Dividends
+
+ 
+ 
+
+Final dividends are recognized as
+a liability when they are approved by the shareholders in a general meeting. Proposed final dividends are disclosed in the notes to the
+financial statements. Interim dividends are simultaneously proposed and declared, and recognized
+immediately as a liability when they are proposed and declared.
+
+ 
+
+ 
+ 
+ Income
+ Taxes
+
+ 
+ 
+
+Income
+tax
+
+ 
+
+Income
+tax comprises current and deferred tax. Income tax relating to items recognized outside profit or loss is recognized outside profit or
+loss, either in other comprehensive income or directly in equity.
+
+ 
+
+Current
+tax assets and liabilities are measured at the amount expected to be recovered from or paid to the taxation authorities, based on tax
+rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period, taking into consideration interpretations
+and practices prevailing in the countries in which the Group operates.
+
+ 
+
+Deferred
+tax is provided, using the liability method, on all temporary differences at the end of the reporting period between the tax bases of
+assets and liabilities and their carrying amounts for financial reporting purposes.
+
+ 
+
+Deferred
+tax liabilities are recognized for all taxable temporary differences, except when the deferred tax liability arises from the initial
+recognition of goodwill or an asset or liability in a transaction that is not a business combination and, at the time of the transaction,
+affects neither the accounting profit nor taxable profit or loss and does not give rise to equal taxable and deductible temporary differences;
+and in respect of taxable temporary differences associated with investments in subsidiaries, associates and joint ventures, when the
+timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse
+in the foreseeable future.
+
+ 
+
+ F-41
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Income
+ Taxes (continued)
+
+ 
+ 
+
+Deferred tax assets are recognized
+for all deductible temporary differences, and the carryforward of unused tax credits and any unused tax losses. Deferred tax assets are
+recognized to the extent that it is probable that taxable profit will be available against which the deductible temporary differences,
+and the carryforward of unused tax credits and unused tax losses can be utilized, except when the deferred tax asset relating to the
+deductible temporary differences arises from the initial recognition of an asset or liability
+in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable
+profit or loss and does not give rise to equal taxable and deductible temporary differences; and in respect of deductible temporary differences
+associated with investments in subsidiaries, associates and joint ventures, deferred tax assets are only recognized to the extent that
+it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which
+the temporary differences can be utilized.
+
+ 
+
+The carrying amount of deferred tax
+assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable
+profit will be available to allow all or part of the deferred tax asset to be utilized. Unrecognized deferred tax assets are reassessed
+at the end of each reporting period and are recognized to the extent that it has become probable that sufficient taxable profit will
+be available to allow all or part of the deferred tax asset to be recovered.
+
+ 
+
+Deferred tax assets and liabilities
+are measured at the tax rates that are expected to apply to the period when the asset is realized or the liability is settled, based
+on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.
+
+ 
+
+Deferred tax assets and deferred
+tax liabilities are offset if and only if the Group has a legally enforceable right to set off current tax assets and current tax liabilities
+and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation authority on either the same
+taxable entity or different taxable entities which intend either to settle current tax liabilities and assets on a net basis, or to realize
+the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities
+or assets are expected to be settled or recovered.
+
+ 
+
+ 
+ 
+ Earnings/(Losses)
+ per Share
+
+ 
+ 
+
+The
+Company computes earnings/losses per share, or EPS, requires companies to present basic and diluted EPS. Basic EPS is measured as net
+income divided by the weighted average ordinary share outstanding for the period. Diluted EPS presents the dilutive effect on a per share
+basis of the potential Class A Ordinary Shares (e.g., convertible securities, options and warrants) as if they had been converted at the
+beginning of the periods presented, or issuance date, if later. Potential Class A Ordinary Shares that have an anti-dilutive effect (i.e.,
+those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. During the years ended
+March 31, 2023 and 2024, there was no dilutive shares.
+
+ 
+
+ 
+ 
+ Retirement
+ Plan Costs
+
+ 
+ 
+
+Contributions to retirement plans (which are defined
+contribution plans) are charged to general and administrative expenses in the accompanying statements of operation as the related employee
+service are provided. The Company is required to make contribution for their employees under a government-mandated multi-employer defined
+contribution pension scheme for its eligible full-time employees in Hong Kong. The Company is required to contribute a specified percentage
+of the participants relevant income based on their ages and wages level. During the years ended March 31, 2023 and 2024, HKD$41,949
+and HKD$72,827 contributions were made accordingly.
+
+ 
+
+ F-42
+
+ 
+
+ 
+
+ 
+
+ 
+ Government
+ Grant
+
+ 
+
+A
+government grant or subsidy is not recognized until there is reasonable assurance that: (a) the enterprise will comply with the conditions
+attached to the grant; and (b) the grant will be received. When the Company receives government grant or subsidies but the conditions
+attached to the grants have not been fulfilled, such government subsidies are deferred and recorded under other payables and accrued
+expenses, and other long-term liability. The classification of short-term or long-term liabilities is depended on the management s
+expectation of when the conditions attached to the grant can be fulfilled. For the years ended March 31, 2023, and 2024, the Company
+received government subsidies of HKD48,000 and HKD178,124, which are recognized as other income in the consolidated statements
+of operations.
+
+ 
+
+ 
+ 
+ Segment
+ Reporting
+
+ 
+ 
+
+The
+Group operates and manages its business as a single segment. The Group s chief operating decision maker, or CODM, is the Chairman.
+The Group s CODM assess the Group s performance and results of operations on a consolidated basis. The Group generates
+substantially all of its revenues from clients in Hong Kong. Accordingly, no geographical segments are presented. Substantially all of
+the Group s long-lived assets are located in Hong Kong.
+
+ 
+
+ 
+ 
+ Related
+ Parties
+
+ 
+ 
+
+Parties
+are considered to be related if one party has the ability, directly or indirectly, to control the other party or exercise significant
+influence over the other party in making financial and operating decisions. Parties are also considered to be related if they are subject
+to common control or significant influence of the same party, such as a family member or relative, shareholder, or a related corporation.
+
+ 
+
+ 
+ 
+ Concentration
+ of Credit Risk
+
+ 
+ 
+
+Financial
+instruments that potentially subject the Company to credit risk consist of cash equivalents and accounts receivable. Cash equivalents
+are maintained with high credit quality institutions, the composition and maturities of which are regularly monitored by management.
+The Hong Kong Deposit Protection Board pays compensation up to a limit of HKD500,000 if the bank with which an individual/a company hold
+its eligible deposit fails. As of March 31, 2023 and 2024, cash and bank balances of HKD328,214 and HKD3,817,083 was maintained at financial
+institutions in Hong Kong, of which none of its cash balance was subject to credit risk. However, if the individual bank balance is over
+HKD500,000, the excess will be subject to credit risk if the relevant bank fails. While management believes that these financial institutions
+are of high credit quality, it also continually monitors their credit worthiness.
+
+ 
+
+For
+accounts receivable, the Company determines, on a continuing basis, the allowance for doubtful accounts based on the estimated realizable
+value. The Company identifies credit risk on a customer by customer basis. The information is monitored regularly by management. Concentration
+of credit risk arises when a group of customers having similar characteristics such that their ability to meet their obligations is expected
+to be affected similarly by changes in economic conditions.
+
+ 
+
+The
+Company has determined the default event on a financial asset to be when internal and/or external information indicates that the financial
+asset is unlikely to be received, which could include default of contractual payments due for more than 90 days, default of interest
+due for more than 365 days or there is significant difficulty of the counterparty. To minimize credit risk, the Company has developed
+and maintained its credit risk grading to categorize exposures according to their degree of risk of default. The credit rating information
+is supplied by publicly available financial information and the Company s own trading records to rate its major customers and other
+debtors.
+
+ 
+
+As
+of March 31, 2023 and 2024, there were accounts receivables of nil and HKD826,687, respectively. Two of customers as at March 31, 2024
+are amounted to 10% or more of the total consolidated amounts.
+
+ 
+
+ F-43
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ Liquidity
+ Risk
+
+ 
+ 
+
+Liquidity risk is the risk that the
+Company will not be able to meet its financial obligations as they become due. The Company s policy is to ensure that it has sufficient
+cash to meet its liabilities when they become due, under both normal and stressed conditions, without incurring unacceptable losses or
+risking damage to the Company s reputation. A key risk in managing liquidity is the degree of uncertainty in the cash flow projections.
+If future cash flows are fairly uncertain, the liquidity risk increases. Liquidity risk is controlled by the application of financial
+position analysis and monitoring procedures. When necessary, we will turn to financial institutions and related parties to obtain short-term
+funding to cover any liquidity shortage.
+
+ 
+
+ 
+ 
+ Fair
+ Value Measurement
+
+ 
+ 
+
+The
+Company establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:
+
+ 
+
+ 
+ 
+ Level
+ 1: Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets;
+
+ 
+ 
+ 
+
+ 
+ 
+ Level
+ 2: Inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments
+ in markets that are not active, and model-based valuation techniques (e.g. Black-Scholes Option-Pricing model) for which all significant
+ inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets
+ or liabilities. Where applicable, these models project future cash flows and discount the future amounts to a present value using
+ market-based observable inputs; and
+
+ 
+ 
+ 
+
+ 
+ 
+ Level
+ 3: Inputs are generally unobservable and typically reflect management s estimates of assumptions that market participants
+ would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option
+ pricing models and discounted cash flow models.
+
+ 
+ 
+
+The
+carrying value of the Company s financial instruments: cash and bank balances, contract costs, accounts receivable, deposits, prepayments
+and other receivables, trade and other payables, tax payable, contract liabilities approximate at their fair values because of the short-term
+nature of these financial instruments.
+
+ 
+
+Fair
+value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates
+are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision.
+Changes in assumptions could significantly affect the estimates.
+
+ 
+
+ F-44
+
+ 
+
+ 
+
+ 
+
+NOTE
+– 3 SEGMENT INFORMATION AND REVENUE
+
+ 
+
+Information
+about major customers
+
+ 
+
+Revenue
+from customers of the corresponding years contributing over 10% of the total revenue of the Group are as follows:
+
+ 
+
+ 
+ 
+ Percentage of 
+ Year
+ ended March 31, 
+
+ 
+ 
+ respective
+ fiscal year 
+ 2023 
+ 2024 
+
+ 
+ 
+ 2023 
+ 2024 
+ HKD 
+ HKD 
+
+ 
+ Customer A 
+ 66.4% 
+ 0.1% 
+ $2,398,888 
+ $20,000 
+
+ 
+ Customer B 
+ 14.2% 
+ - 
+ $511,602 
+ $- 
+
+ 
+ Customer C 
+ - 
+ 66.5% 
+ 101,985 
+ 13,595,846 
+
+ 
+ Customer D 
+ 2.8% 
+ 12.5% 
+ - 
+ 2,549,151 
+
+ 
+
+ 
+
+An
+analysis of revenue is as follows:
+
+ 
+
+ 
+ 
+ Year
+ ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Provision of event management 
+ $1,907,953 
+ $6,733,049 
+
+ 
+ Sales of goods 
+ 1,210,704 
+ 11,459,364 
+
+ 
+ Design and others 
+ 496,480 
+ 2,248,270 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total: 
+ $3,615,137 
+ $20,440,683 
+
+ 
+
+ 
+
+ 
+
+The
+following tables present the Company s revenue disaggregated by timing of revenue recognition, based on management s assessment
+of available data:
+
+ 
+
+ 
+ 
+ Year
+ ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Over time 
+ $2,404,433 
+ $8,981,319 
+
+ 
+ At a point in time 
+ 1,210,704 
+ 11,459,364 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total: 
+ $3,615,137 
+ $20,440,683 
+
+ 
+
+ 
+
+ F-45
+
+ 
+
+ 
+
+ 
+
+NOTE
+– 4 OTHER INCOME/(EXPENSES)
+
+ 
+
+ 
+ 
+ Year
+ ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Government grant 
+ $48,000 
+ $178,124 
+
+ 
+ Bank interest income 
+ 441 
+ 22,995 
+
+ 
+ Finance costs 
+ (179,651) 
+ (246,262)
+
+ 
+ Gain/(Loss) on early termination
+ of leases 
+ (7,480) 
+ 2,539 
+
+ 
+ Total 
+ $(138,690) 
+ $(42,604)
+
+ 
+
+ 
+
+Government
+grant in relation to the funding support from the Employment Support Scheme under the Anti-epidemic Fund during the year ended March
+31, 2023 and technology voucher program set up by the Hong Kong Government during the year ended March 31, 2024.
+
+ 
+
+Finance
+costs represented interests for bank borrowings and finance leases during the year ended March 31, 2023 and 2024.
+
+ 
+
+NOTE
+– 5 GENERAL AND ADMINISTRATIVE EXPENSES
+
+ 
+
+The
+following table sets forth the breakdown of our administrative expenses for the years ended March 31, 2023 and 2024:
+
+ 
+
+ 
+ 
+ Year
+ ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Accounting fee 
+ $16,000 
+ $24,000 
+
+ 
+ Bank charges 
+ 12,051 
+ 3,760 
+
+ 
+ Insurance expenses 
+ 3,298 
+ 30,376 
+
+ 
+ Staff payroll costs 
+ 395,000 
+ 232,956 
+
+ 
+ Office expenses 
+ 17,954 
+ 329,360 
+
+ 
+ Sundries 
+ 46,333 
+ 45,834 
+
+ 
+ Total: 
+ $490,636 
+ $666,286 
+
+ 
+
+ 
+
+NOTE
+– 6 CONTRACT COSTS
+
+ 
+
+ 
+ 
+ As of March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Project costs incurred 
+ $- 
+ $4,337,713 
+
+ 
+
+ 
+
+Contract assets capitalized relate
+to prepaid project costs such as subcontracting fee, royalty fee incurred in satisfying performance obligations of respective projects
+in the future. Contract assets are recognized as part of direct costs in the statements of operations in the year in which revenue from
+the related projects is recognized. There is no impairment for the years ended March 31, 2023 and 2024, respectively. The expected timing
+of recovery or settlement for contract assets as at March 31, 2024 is within one year.
+
+ 
+
+ F-46
+
+ 
+
+ 
+
+ 
+
+NOTE
+– 7 ACCOUNTS RECEIVABLE, NET
+
+ 
+
+Accounts
+receivable, net consisted of the following:
+
+ 
+
+ 
+ 
+ As
+ of March 31,
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Accounts receivable
+ from third parties, net 
+ $- 
+ $826,687 
+
+ 
+
+ 
+
+The
+Company generally conducts its business with creditworthy third parties. The Company determines, on a continuing basis, the probable
+losses and an allowance for doubtful accounts, based on several factors including payment history, historical bad debt/write-off experience
+and forecasted economic and market conditions. Accounts receivable are written off after exhaustive collection efforts occur and the
+receivable is deemed uncollectible. In addition, receivable balances are monitored on an ongoing basis and its exposure to bad debts
+is not significant. Provision for allowance were nil during the years ended March 31, 2023 and 2024, respectively.
+
+ 
+
+NOTE
+– 8 EQUIPMENT, NET
+
+ 
+
+Equipment
+consisted of the following:
+
+ 
+
+ 
+ 
+ As
+ of March 31,
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Office equipment, at cost 
+ $20,000 
+ $20,000 
+
+ 
+ Leasehold improvement,
+ at cost 
+ - 
+ 141,800 
+
+ 
+ Total 
+ 20,000 
+ 161,800 
+
+ 
+ Less: accumulated depreciation 
+ (20,000) 
+ (25,908)
+
+ 
+ 
+ 
+ 
+
+ 
+ Equipment, net 
+ $- 
+ $135,892 
+
+ 
+
+ 
+
+Depreciation
+expense for the years ended March 31, 2023 and 2024 were HKD1,000 and HKD5,908, respectively.
+
+ 
+
+ F-47
+
+ 
+
+ 
+
+ 
+
+NOTE
+– 9 LEASES
+
+ 
+
+As
+of March 31, 2023 and 2024, the Group, as lessee, subsisted of the following lease contracts for office premises and finance lease for
+motor vehicle. There is no low value/short term leases exception.
+
+ 
+
+ 
+ 
+ (a)
+ Right-of-use
+ assets
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ carrying amounts of the Group s right-of-use assets and the movements during the year are as follows:
+
+ 
+ 
+
+ 
+ 
+ Office 
+Premises 
+ Motor 
+vehicles 
+ Total 
+
+ 
+ 
+ HKD 
+ HKD 
+ HKD 
+
+ 
+ As at 1 April 2022 
+ - 
+ 174,778 
+ 174,778 
+
+ 
+ Additions 
+ 611,067 
+ - 
+ 611,067 
+
+ 
+ Early termination of operating lease 
+ (109,476) 
+ - 
+ (109,476)
+
+ 
+ Depreciation charge 
+ (109,673) 
+ (95,333) 
+ (205,006)
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ As at March 31 2023 
+ 391,918 
+ 79,445 
+ 471,363 
+
+ 
+ Additions 
+ 818,605 
+ - 
+ 818,605 
+
+ 
+ Disposal 
+ - 
+ (7,945) 
+ (7,945)
+
+ 
+ Early termination of operating lease 
+ (204,479) 
+ - 
+ (204,479)
+
+ 
+ Depreciation charge 
+ (216,675) 
+ (71,500) 
+ (288,175)
+
+ 
+ As at March 31 2024 
+ 789,369 
+ - 
+ 789,369 
+
+ 
+
+ 
+
+ 
+ 
+ (b)
+ Lease
+ liabilities
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ The
+ carrying amount of lease liabilities and the movements during the year are as follows:
+
+ 
+ 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Carrying amount at 1 April 
+ 147,327 
+ 398,431 
+
+ 
+ New leases 
+ 611,067 
+ 818,605 
+
+ 
+ Accretion of interest recognized during the
+ year 
+ 16,023 
+ 24,370 
+
+ 
+ Early termination of operating lease during
+ the year 
+ (101,996) 
+ (207,018)
+
+ 
+ Payments 
+ (273,990) 
+ (254,534)
+
+ 
+ 
+ 
+ 
+
+ 
+ Carrying amount at
+March 31 
+ 398,431 
+ 779,854 
+
+ 
+ Analyzed into: 
+ 
+ 
+
+ 
+ Current portion 
+ 144,074 
+ 178,001 
+
+ 
+ Non-current
+ portion 
+ 254,357 
+ 601,853 
+
+ 
+ Total 
+ 398,431
+ 
+ 779,854
+ 
+
+ 
+
+ 
+
+The
+following tables summarize the maturity of lease liabilities as at March 31, 2023 and 2024:
+
+ 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ With one year 
+ 144,074 
+ 178,001 
+
+ 
+ One to two years 
+ 254,357 
+ 479,294 
+
+ 
+ Two to three years 
+ - 
+ 122,559 
+
+ 
+ Total 
+ 398,431 
+ 779,854 
+
+ 
+
+ 
+
+ F-48
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ (c)
+ The
+ amounts recognized in profit or loss in relation to leases are as follows:
+
+ 
+ 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Loss/(Gain) on early termination 
+ 7,480 
+ (2,539)
+
+ 
+ Interest on lease liabilities 
+ 16,023 
+ 24,370 
+
+ 
+ Depreciation: 
+ 
+ 
+
+ 
+ Depreciation charge of right-of-use assets 
+ 205,006 
+ 288,175 
+
+ 
+ Total amount recognized in statement of operations 
+ 228,509 
+ 310,006 
+
+ 
+
+ 
+
+NOTE
+– 10 DEPOSITS, PREPAYMENTS AND OTHER RECEIVABLES
+
+ 
+
+ 
+ 
+ As
+ of March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Rental and other deposits 
+ $139,495 
+ $290,814 
+
+ 
+
+ 
+
+NOTE
+– 11 TRADE AND OTHER PAYABLE
+
+ 
+
+ 
+ 
+ As
+ of March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Trade payables 
+ $40,624 
+ $1,390,928 
+
+ 
+ Accrued salaries 
+ 80,600 
+ 173,435 
+
+ 
+ Other accrued expenses 
+ 16,000 
+ 9,220 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total 
+ $137,224 
+ $1,573,583 
+
+ 
+
+ 
+
+An
+aging analysis of the trade and bills payables as at the end of the reporting period, based on the invoice date, is as follows:
+
+ 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Within 1 month 
+ $40,624 
+ $1,287,758 
+
+ 
+ 1 to 2 months 
+ - 
+ 103,170 
+
+ 
+ Total 
+ $40,624 
+ $1,390,928 
+
+ 
+
+ 
+
+NOTE
+– 12 CONTRACT LIABILITIES
+
+ 
+
+As of March 31, 2023 and 2024, contract
+liabilities amounted nil and HKD3,569,274, respectively. The amount represented amount received from customer in advance. The Group receives
+advanced payment from customer based on contract. Payments are usually received in advance before performance under the contracts which
+are mainly for provision of event management services to be performed subsequent to the balance sheet date. The expected time band for
+the contracts are within the next 12 months for which the practical expedient in paragraph 121(a) of IFRS 15 applies.
+
+ 
+
+NOTE
+– 13 DIVIDEND
+
+ 
+
+ 
+ 
+ Years
+ ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Interim
+ dividend 
+ $- 
+ $5,500,000 
+
+ 
+
+ 
+
+For the year ended March 31, 2024, Trendic declared and paid a dividend
+of HK$5,500,000 (approximately US$706,000) to its shareholders registered as such on March 30, 2024. The respective dividend
+was offset amount due from a shareholder during the year ended March 31, 2024.
+
+ 
+
+ F-49
+
+ 
+
+ 
+
+ 
+
+NOTE
+– 14 NET PROFIT/(LOSS) PER CLASS A ORDINARY SHARE
+
+ 
+
+Basic
+net profit/(loss) per share is computed using the weighted average number of Class A Ordinary Shares outstanding during the year. The
+following table sets forth the computation of basic and diluted net profit/(loss) per share for the years ended March 31, 2023
+and 2024:
+
+ 
+
+ 
+ 
+ Years
+ ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net profit/(loss)
+ attributable to ordinary shareholders 
+ $(482,783) 
+ $7,088,874 
+
+ 
+ 
+ 
+ 
+
+ 
+ Weighted average Class A Ordinary Shares outstanding 
+ 
+ 
+
+ 
+ – Basic 
+ 28,660,000
+
+ 
+ 28,660,000 
+
+ 
+ Weighted average
+ Class A Ordinary Shares outstanding
+
+ 
+ 
+ 
+
+ 
+ – Diluted 
+ 29,660,000
+ 
+ 29,660,000
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Weighted average Class B Ordinary Shares outstanding
+ – Basic and diluted 
+ 1,000,000
+ 
+ 1,000,000
+ 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net
+ (loss)/profit per Class A Ordinary Share – Basic
+
+ 
+ $(0.017) 
+ $0.247 
+
+ 
+ 
+ 
+ 
+
+ 
+ Net (loss)/profit
+ per Class A Ordinary
+ Share – Diluted
+
+ 
+ $(0.016
+) 
+ $0.239
+ 
+
+ 
+
+ 
+
+As Class B Ordinary
+Shares do not have right to dividend. there is no impact when calculated basic net profit per Class A and Class B Ordinary Shares. However,
+as Class B Ordinary Shares have the right to convert into Class A Ordinary Shares, there is dilutive impact during the six months ended
+September 30, 2023 and 2024.
+
+ 
+
+NOTE
+– 15 INTEREST BEARING BANK BORROWINGS
+
+ 
+
+ 
+ 
+ As
+ of March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HK$ 
+ HK$ 
+
+ 
+ Bank loans secured and repayable 
+ 
+ 
+
+ 
+ Within 12 months 
+ 503,180 
+ 642,015 
+
+ 
+ Over 1 year 
+ 3,735,873 
+ 3,093,858 
+
+ 
+ Total 
+ 4,239,053 
+ 3,735,873 
+
+ 
+
+ 
+
+During
+the year ended March 31, 2023 and 2024, the Group entered into loan agreements with a financial institution in Hong Kong to borrow loans
+of HK$2,673,000 and HK$1,900,000, respectively which bears annual interest at a rate of floating prime rate minus 2.5% and flat rate
+5.04% per annum, respectively, with due date in November 2033 and May 2026, respectively. Pursuant to Hong Kong mortgage corporation s
+published information, Hong Kong prime rate ranging from 5.375% to 5.875%, and from 5.875% to 6.125% during the year ended March 31,
+2023 and 2024, respectively.
+
+ 
+
+As
+of March 31, 2023 and 2024, the bank loans of the Company were secured by personal guarantee from Ms. Seto, the director and shareholder
+of the Company.
+
+ 
+
+Interest
+related to the bank loans was HK$163,628 and HK$221,892 for the years ended March 31, 2023 and 2024, respectively.
+
+ 
+
+Principal
+repayments to maturity by fiscal year are as follows:
+
+ 
+
+ 
+ Year ended March 31, 
+ HKD 
+
+ 
+ 2025 
+ $642,015 
+
+ 
+ 2026 
+ 771,332 
+
+ 
+ Thereafter 
+ 2,322,526 
+
+ 
+ Total 
+ $3,735,873 
+
+ 
+
+ 
+
+NOTE
+– 16 SHAREHOLDERS EQUITY
+
+ 
+
+Authorized
+shares
+
+ 
+
+The
+Company was incorporated in the Cayman Islands with limited liability on July 5, 2024 and the initial 1 fully-paid share was transferred
+to Ms. Seto on the same date for cash at par. The initial authorized share capital of the Company is US$100,000 divided into 1,000,000,000
+Shares of a par value of US$0.0001 each. The details about reorganization subsequent to the balance sheet date is stated in note 21.
+
+ 
+
+The Company has retroactively
+presented all shares and per share data for all periods presented. As a result of the issuances and reclassification stated above, the
+Company had 950,000,000 authorized Class A ordinary shares, par value of US$0.00001, of which 28,660,000 and 28,660,000 Class A ordinary
+shares were issued and outstanding as of March 31, 2023 and 2024, respectively. The Company had 500,000,000 authorized Class B ordinary
+shares, par value of US$0.00001, of which 1,000,000 and 1,000,000 Class B ordinary shares were issued and outstanding as of March 31,
+2023 and 2024, respectively.
+
+ 
+
+As
+at March 31, 2024, the subscription receivables has yet been paid.
+
+ 
+
+ F-50
+
+ 
+
+ 
+
+ 
+
+NOTE
+– 17 INCOME TAXES
+
+ 
+
+The
+provision for income taxes consisted of the following:
+
+ 
+
+ 
+ 
+ Years
+ ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Current 
+ $- 
+ $988,347 
+
+ 
+ Deferred 
+ - 
+ - 
+
+ 
+ 
+ 
+ 
+
+ 
+ Total income tax expense 
+ $- 
+ $988,347 
+
+ 
+
+ 
+
+The
+effective tax rate in the years presented is the result of the mix of income earned in various tax jurisdictions that apply a broad range
+of income tax rate. The Company s subsidiaries mainly operate in Hong Kong that are subject to taxes in the jurisdictions in which
+they operate, as follows:
+
+ 
+
+Cayman
+Islands
+
+ 
+
+Under
+the current laws of the Cayman Islands, the Company is not subject to tax on income or capital gain. Additionally, upon payments of dividends
+to the shareholders, no Cayman Islands withholding tax will be imposed.
+
+ 
+
+BVI
+
+ 
+
+LTV
+is considered to be an exempted British Virgin Islands Company and is presently not subject to income taxes or income tax filing requirements
+in the British Virgin Islands.
+
+ 
+
+Hong
+Kong
+
+ 
+
+TIL
+is incorporated in Hong Kong and are subject to Hong Kong Profits Tax on the taxable income as reported in its statutory financial statements
+adjusted in accordance with relevant Hong Kong tax laws. Under the two-tiered profit tax rates regime, the profit tax rate for the first
+$2,000,000 assessable profits arising from Hong Kong of qualifying entities are taxed at 8.25%, and assessable profits arising from Hong
+Kong above $2,000,000 are taxed at the rate of 16.5%. The applicable tax rate is 16.5% in Hong Kong.
+
+ 
+
+The
+reconciliation of income tax rate to the effective income tax rate based on loss before income taxes for the years ended March 31, 2023
+and 2024 are as follows:
+
+ 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ 
+ 
+ 
+
+ 
+ Profit/(Loss) before income taxes 
+ $(482,783) 
+ $8,077,221 
+
+ 
+ Statutory income tax rate 
+ 16.5% 
+ 16.5%
+
+ 
+ Income tax benefit at statutory rate 
+ (79,659) 
+ 1,332,741 
+
+ 
+ Effect of two-tier tax regime 
+ 
+ 
+
+ 
+ Items not subject to taxes 
+ 40,011 
+ (165,000)
+
+ 
+ Under provision of tax 
+ 35,050 
+ - 
+
+ 
+ Tax loss from previous periods utilized 
+ - 
+ (176,170)
+
+ 
+ Temporary timing difference 
+ 4,598 
+ (3,224)
+
+ 
+ 
+ 
+ 
+
+ 
+ Income tax expense 
+ $- 
+ $988,347 
+
+ 
+
+ 
+
+No
+deferred tax assets or liabilities has been recognized in the consolidated financial statements as the Group did not have material
+temporary differences arising between the tax bases of assets and liabilities and their carrying amounts as of March 31, 2023 and 2024.
+
+ 
+
+ F-51
+
+ 
+
+ 
+
+ 
+
+Uncertain
+tax positions
+
+ 
+
+The
+Company evaluates the uncertain tax position (including the potential application of interest and penalties) based on the technical merits,
+and measure the unrecognized benefits associated with the tax positions. As of March 31, 2023 and 2024, the Company did not have any
+significant unrecognized uncertain tax positions. The Company did not incur any interest and penalties related to potential underpaid
+income tax expenses for the years ended March 31, 2023 and 2024 and also did not anticipate any significant increases or decreases in
+unrecognized tax benefits in the next 12 months from March 31, 2024.
+
+ 
+
+NOTE
+– 18 RELATED PARTY TRANSACTIONS AND BALANCES
+
+ 
+
+The
+related party of the Company with whom transactions are reported in these financial statements are as follows:
+
+ 
+
+ 
+ Name
+ of Individual
+ 
+ Relationship
+ with the Company
+
+ 
+ Ms.
+ Seto Wai Yue
+ 
+ Shareholder
+ and Director of the Company
+
+ 
+ Exit
+ (HK) Limited
+ 
+ Ms.
+ Seto is a 40% shareholder and the sole director of Exit (HK)
+
+ 
+ Earthling
+ Catering Limited
+ 
+ Ms.
+ Seto is a 64% shareholder and a director of Earthling 
+
+ 
+ Exit
+ Catering Limited
+ 
+ Ms.
+ Seto is a 51% shareholder and a director of Exit Catering
+
+ 
+ 
+
+Amount
+due from a shareholder
+
+ 
+
+ 
+ 
+ As
+ of March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Seto Wai
+ Yue 
+ $4,747,823 
+ $2,950,434 
+
+ 
+
+ 
+
+The
+balances are unsecured, non-interest bearing, and payable on demand. The balances were recorded in current assets.
+
+ 
+
+During the years ended March 31, 2023 and 2024, the proceeds and payments
+to a shareholder are as follows
+
+ 
+
+ 
+ 
+ Years ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Proceeds from a shareholder 
+ $793,266 
+ $18,039,849 
+
+ 
+ Payments to a shareholder 
+ (4,362,363) 
+ (21,742,460)
+
+ 
+
+ 
+
+Revenue
+
+ 
+
+ 
+ 
+ Years
+ ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+
+ 
+ 
+ HKD 
+ HKD 
+
+ 
+ Exit (HK) Limited 
+ 2,398,888 
+ 20,000 
+
+ 
+ Exit Catering Limited 
+ - 
+ 317,586 
+
+ 
+ Earthling Catering Limited 
+ 78,340 
+ - 
+
+ 
+ 
+ $2,477,228 
+ $337,586 
+
+ 
+
+ 
+
+ F-52
+
+ 
+
+ 
+
+ 
+
+NOTE
+– 19 CONCENTRATIONS OF RISK
+
+ 
+
+The
+Company is exposed to the following concentrations of risk:
+
+ 
+
+(a)
+Major customers
+
+ 
+
+For
+the years ended March 31, 2023 and 2024, there were individual customer accounts for 10% or more of the Company s revenues as stated
+in note 3 above.
+
+ 
+
+Most
+of the customers are located in Hong Kong.
+
+ 
+
+(b)
+Major vendors
+
+ 
+
+For
+the years ended March 31, 2023 and 2024, the vendors who accounted for 10% or more of the Company s cost of revenue and is presented
+as follows:
+
+ 
+
+ 
+ Vendors 
+ Percentage of respective fiscal year 
+ Year ended March 31, 
+
+ 
+ 
+ 2023 
+ 2024 
+ 2023 
+ 2024 
+
+ 
+ 
+ 
+ 
+ HKD 
+ 
+
+ 
+ Vendor A 
+ 32.3% 
+ - 
+ $1,054,187 
+ $- 
+
+ 
+ Vendor B 
+ 13.0% 
+ 
+ 423,080 
+ - 
+
+ 
+ Vendor C 
+ 12.3% 
+ - 
+ 400,170 
+ - 
+
+ 
+ Vendor D 
+ - 
+ 24.2% 
+ - 
+ 2,745,741 
+
+ 
+
+ 
+
+Most
+of the vendors are located in Hong Kong.
+
+ 
+
+(b)
+Credit risk
+
+ 
+
+Please
+refer to note 2 for details.
+
+ 
+
+(c)
+Interest rate risk
+
+ 
+
+As
+the Company has no significant interest-bearing assets, the Company s income and operating cash flows are substantially independent
+of changes in market interest rates.
+
+ 
+
+(d)
+Economic and political risk
+
+ 
+
+The
+Company s major operations are conducted in Hong Kong. Accordingly, the political, economic, and legal environments in Hong Kong,
+as well as the general state of Hong Kong s economy may influence the Company s business, financial condition, and results
+of operations.
+
+ 
+
+(e)
+Liquidity risk
+
+ 
+
+Please
+refer to notes 2, 9 and 15 for details.
+
+ 
+
+ F-53
+
+ 
+
+ 
+
+ 
+
+NOTE
+– 20 COMMITMENTS AND CONTINGENCIES
+
+ 
+
+The
+Company currently is not aware of any legal proceedings or claims that it believes will have, individually or in the aggregate, a material
+adverse effect on its business, financial condition, operating results, or cash flows.
+
+ 
+
+As
+of March 31, 2023 and 2024, the Company has no material commitments or contingencies.
+
+ 
+
+NOTE
+– 21 SUBSEQUENT EVENTS 
+
+ 
+
+Reorganization
+
+ 
+
+On
+August 19, 2024, Ms. Seto and Kilo Wonders (Ms. Yip s nominee) subscribed for 19,059 and 940 Shares for cash at par.
+
+ 
+
+Subsequently, on even date, Ms. Seto,
+Kilo Wonders and Yield Rights further subscribed for 4,500,939, 234,059 and 245,000 Shares of the Company for cash at par. Following
+this step, the Company is held as to 4,519,999, 234,999 and 245,000 Shares by Ms. Seto, Kilo Wonders and Yield Rights respectively representing
+90.4%, 4.7% and 4.9% of the issued share capital of the Company.
+
+ 
+
+On
+July 25, 2024, Goal Success was incorporated in the BVI with limited liability. Goal Success is authorized to issue a maximum
+of 50,000 shares of a single class each with a par value of US$1.00. On July 25, 2024, the Company subscribed for, and Goal Success allotted
+and issued to it 1 share for cash at par. 
+
+ 
+
+On
+March 6, 2025, Ms. Seto, Ms. Yip and the Company entered into an agreement whereby Ms. Seto and Ms. Yip transferred their entire
+shareholding interest in Trendic to the Company s nominee, Goal Success. The consideration is settled by the Company allotting
+and issuing 1 Share to each of Ms. Seto and Kilo Wonders (Ms. Yip s nominee), credited as fully paid and Goal Success allotting
+and issuing 1 share to the Company credited as fully paid.
+
+ 
+
+Loan
+from Ms. Seto Wai Yue and amount due from a shareholder
+
+ 
+
+On
+April 10, 2024, Ms. Seto Wai Yue entered into an interest-free loan facility agreement with Trendic, for a revolving loan facility agreement
+of up to HK$12,000,000 for the purposes of paying the costs and expenses in connection with the offering. Such amount is repayable on
+the earlier of the completion of this offering and September 30, 2025.
+
+ 
+
+The
+amount due from a shareholder as at March 31, 2024 was fully settled subsequently.
+
+ 
+
+Contract
+with an event local facilitator
+
+ 
+
+Subsequent
+to the balance sheet date, the Group signed contract with an event local facilitator who is also a major customer of the Group, to assume
+his responsibilities and obligations of organizing for events by payment of HK$4.6 million. Up to the date of this report, the Group
+paid HK$4.1 million.
+
+ 
+
+The below is Unaudited event subsequent
+to the date of the Independent Auditor s Report:
+
+ 
+
+On March 31, 2025
+for purposes of recapitalization in anticipation of the initial public offering, the Company s shareholders passed resolutions
+(i) sub-divide each of the issued and unissued shares in its share capital of par value US$0.0001 each into 10 shares of par value
+US$0.00001 each, (ii) to re-classify and re-designate its authorised share capital into 10,000,000,000 shares with a par value of US$0.00001
+each comprising of (a) 9,500,000,000 Class A Ordinary Shares with a par value of US$0.00001 each and (b) 500,000,000 Class B Ordinary
+Shares with a par value of US$0.00001 each and (iii) to adopt an amended and restated memorandum of association and articles of association
+reflecting such amended share capital and containing the rights, preferences and privileges attached to each class of shares. Concurrently,
+Ms. Seto, Prime Crest, Fuji Holdings, Kilo Wonders, Yield Rights and Allied Target surrendered 16,303,760, 1,045,660, 960,300, 1,002,980,
+1,045,660 and 981,640 Class A Ordinary Shares to the Company, respectively.
+On March 31, 2025, the Company allotted and issued 1,000,000 Class B Ordinary Shares to Ms. Seto for cash at par, and a resolution was
+passed on March 31, 2025 giving effect to the same.
+
+ 
+
+ F-54
+
+ 
+
+ 
+
+ 
+
+Dreamland
+Limited
+
+ 
+
+Class A Ordinary Shares
+
+ 
+
+Bancroft
+Capital, LLC
+
+ 
+
+Prospectus
+dated , 2025
+
+ 
+
+Until
+ , 2025 (the 25th day after the date of this prospectus), all dealers
+that effect transactions in these Class A Ordinary Shares, whether or not participating in this offering, may be required to deliver
+a prospectus. This is in addition to the dealers obligation to deliver a prospectus when acting as an underwriter and with respect
+to their unsold allotments or subscriptions.
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+RESALE
+PROSPECTUS ALTERNATE PAGE
+
+ 
+
+The
+information in this prospectus is not complete and may be changed or supplemented. We may not sell these securities until the registration
+statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and
+it is not soliciting an offer to buy these securities in any jurisdiction where such offer or sale is not permitted.
+
+ 
+
+PRELIMINARY
+PROSPECTUS
+
+ 
+
+SUBJECT
+TO COMPLETION, DATED June 27,
+2025
+
+ 
+
+Dreamland Limited
+
+ 
+
+5,416,740 Class A Ordinary Shares
+
+ 
+
+This
+prospectus relates to the resale of 5,416,740 Class A Ordinary Shares of US$0.00001 each par value, or Class A Ordinary Shares, of Dreamland
+Limited held by Prime Crest Holdings Limited, Fuji Holdings Limited, Yield Rights Group Limited and Allied Target Limited (collectively
+the "Resale Shareholders"). We will not receive any of the proceeds from the sale of Class A Ordinary Shares by the Resale
+Shareholders. None of the Resale Shareholders nor any of the natural persons who control the Resale Shareholders has held any position,
+office or had any material relationship with the Company or any of its subsidiaries predecessors or affiliates within the past
+three years from the date of the filing of the registration statement.
+
+ 
+
+The
+resale of the Class A Ordinary Shares by the Resale Shareholders is conditioned upon the successful completion of the sale of the Class A Ordinary Shares in our underwritten primary offering and the listing of the Class A Ordinary Shares on the Nasdaq Capital Market or another national
+securities exchange. Following the listing of our Class A Ordinary Shares on the Nasdaq Capital Market, any sales of Class A Ordinary Shares by the
+Resale Shareholders will occur at prevailing market prices, at prices related to prevailing market prices or at privately negotiated
+prices. The registration of the Class A Ordinary Shares held by the Resale Shareholders does not mean that the Resale
+Shareholders will offer or sell any of the Class A Ordinary Shares. In addition, we will pay all fees and expenses incident to the
+registration of the Class A Ordinary Shares held by the Resale Shareholders. The distribution of securities offered hereby may be effected
+in one or more transactions that may take place in ordinary brokers transactions, privately negotiated transactions or
+through sales to one or more dealers for resale of such securities as principals. Usual and customary or specifically negotiated
+brokerage fees or commissions may be paid by the Resale Shareholders. For additional information on the possible methods of sale that may be used by the Resale Shareholders, you should
+refer to the section of this prospectus entitled "Plan of Distribution".
+
+ 
+
+On
+ , 2025, a registration statement under the Securities Act with respect to our initial public offering of Class A Ordinary Shares
+was declared effective by the Securities and Exchange Commission. We received approximately US$7,500,000 in net proceeds from
+the offering after payment of underwriting discounts and commissions and estimated expenses of the offering.
+
+ 
+
+Concurrent
+with our initial public offering, our Class A Ordinary Shares were listed on the Nasdaq Capital Market or another national securities
+exchange under the symbol "TDIC."
+
+ 
+
+You are investing in Class
+A Ordinary Shares of our Company, a Cayman Islands holding company. Investors of our Class A Ordinary Shares are not purchasing and may
+never directly hold equity interests in Trendic International Limited, our indirect wholly-owned subsidiary incorporated in Hong Kong through
+which we conduct our business. Such a structure involves unique risks to investors in
+this offering. Chinese regulatory authorities could disallow this structure, which would likely result in a material change in our operations
+and/or a material change in the value of the securities we are registering for sale, including that it could cause the value of such
+securities to significantly decline or become worthless. For a detailed description, see "Risks Relating to Doing Business in
+Hong Kong" on page 33 of this prospectus.
+
+ 
+
+We are an "Emerging
+Growth Company" and a "Foreign Private Issuer" under applicable U.S. federal securities laws and, as such, are eligible
+for reduced public company reporting requirements. Investing in our Class A Ordinary Shares involves risks. Please see "Implications
+of Our Being an Emerging Growth Company" and "Implications of Our Being a Foreign Private Issuer" beginning
+on pages 13 and 14 of this prospectus for more information.
+
+ 
+
+An
+investment in our Class A Ordinary Shares involves significant risks. You should carefully consider the risk factors beginning on page
+17 of this prospectus before you make your decision to invest in our Class A Ordinary Shares.
+
+ 
+
+Upon
+completion of the offering conducted by the Company on , 2025, we will be a "controlled company" as defined under the
+Nasdaq Stock Market Rules as long as our majority and eventual controlling shareholder Upon completion of this offering, Ms. Seto Wai
+Yue will be the beneficial owner of an aggregate of 21,236,240 Class A Ordinary Shares, which will represent 70.81% of the total issued
+and outstanding Class A Ordinary Shares. Ms. Seto will also be the beneficial owner of 100% of our outstanding Class B Ordinary Shares,
+which together with the Class A Ordinary Shares, will represent 79.13% of the total aggregate voting power of the Company. For so long
+as we are a controlled company under that definition, we are permitted to elect to rely, and may rely, on certain exemptions from corporate
+governance rules although we do not presently intend to rely on such exemptions.
+
+ 
+
+As
+a result, you may not have the same protection afforded to shareholders of companies that are subject to these corporate governance requirements.
+Although we do not intend to rely on the "controlled company" exemption under the Nasdaq Stock Market Rules, we could elect
+to rely on this exemption in the future. If we elected to rely on the "controlled company" exemption, a majority of the members
+of our board of directors might not be independent directors and our nomination and compensation committees might not consist entirely
+of independent directors upon closing of the offering. If we cease to remain as a foreign private issuer, we may rely on these exemptions.
+Furthermore, Ms. Seto Wai Yuec will be able to exert significant control over our management and affairs, including approval of significant
+corporate transactions. For additional information, see "Risks Relating to Our Initial Public Offering and Ownership of Our Class
+A Ordinary Shares" on page 42 of this prospectus. Ms. Seto Wai Yue, our controlling shareholder, has substantial influence
+over our Company. Her interests may not be aligned with the interests of our other shareholders, and she could prevent or cause a change
+of control or other transactions.
+
+ 
+
+Neither
+the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the
+accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.
+
+ 
+
+The Holding Foreign Companies
+Accountable Act, or HFCA, Act was enacted on December 18, 2020. The HFCA Act states if the United States Securities and Exchange Commission,
+or the SEC or the Securities and Exchange Commission, determines that a company has filed audit reports issued by a registered public
+accounting firm that has not been subject to inspection by the Public Company Accounting Oversight Board of the United States, or PCAOB,
+for two consecutive years beginning in 2021, the SEC shall prohibit the company s shares from being traded on a national securities
+exchange or in the over-the-counter trading market in the United States. Our auditor, TAAD LLP, or TAAD, the independent registered public
+accounting firm that issues the audit report included in this prospectus, as an auditor of companies that are operating in the United
+States and a firm registered with the PCAOB, is subject to laws in the United States pursuant to which the PCAOB conducts regular inspections
+to assess TAAD s compliance with applicable professional standards. TAAD is headquartered in the United States, and can be inspected
+by PCAOB. On August 26, 2022, CSRC, the Ministry of Finance of the PRC, and the PCAOB signed a Statement of Protocol (the "Protocol"),
+governing inspections and investigations of audit firms based in China and Hong Kong. Pursuant to the fact sheet with respect to the
+Protocol disclosed by the SEC, the PCAOB shall have independent discretion to select any issuer audits for inspection or investigation
+and has the unfettered ability to transfer information to the SEC. On December 15, 2022, the PCAOB Board determined that the PCAOB was
+able to secure complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong
+Kong and voted to vacate its previous determinations to the contrary. However, should PRC authorities obstruct or otherwise fail to facilitate
+the PCAOB s access in the future, the PCAOB Board will consider the need to issue a new determination. On December 29, 2022, the
+Accelerating Holding Foreign Companies Accountable Act, or the Accelerating HFCA Act, was signed into law, which amended the HFCA Act
+by requiring the SEC to prohibit an issuer s securities from trading on any U.S. stock exchanges if its auditor is not subject
+to PCAOB inspections for two consecutive years instead of three. On December 29, 2022, legislation titled "Consolidated Appropriations
+Act, 2023" (the "Consolidated Appropriations Act"), was signed into law by former President Biden. The Consolidated
+Appropriations Act contained, among other things, an identical provision to Accelerating HFCA Act, which reduces the number of consecutive
+non-inspection years required for triggering the prohibitions under the HFCA Act from three years to two. As a result of the Consolidated
+Appropriations Act, the Holding Foreign Companies Accountable Act (the "HFCA Act") now also applies if the PCAOB s
+inability to inspect or investigate the relevant accounting firm is due to a position taken by an authority in any foreign jurisdiction.
+The denying jurisdiction does not need to be where the accounting firm is located. Our current auditor, TAAD, is a firm registered with
+the PCAOB with its headquarters at Diamond Bar, California, is subject to laws in the United States pursuant to which the PCAOB conducts
+regular inspections to assess its compliance with the applicable professional standards. Notwithstanding the foregoing, in the future,
+if there is any regulatory change or step taken by PRC regulators that does not permit our auditor to provide audit documentations located
+in China to the PCAOB for inspection or investigation, investors may be deprived of the benefits of such inspection. Any audit reports
+not issued by auditors that are completely inspected by the PCAOB, or a lack of PCAOB inspections of audit work undertaken in China that
+prevents the PCAOB from regularly evaluating our auditors audits and their quality control procedures, could result in a lack
+of assurance that our financial statements and disclosures are adequate and accurate, then such lack of inspection could cause our securities
+to be delisted from the stock exchange. We cannot assure you whether Nasdaq or other regulatory authorities will apply additional
+or more stringent criteria to us. Such uncertainty could cause the market price of our Class A Ordinary Shares to be materially and adversely
+affected.
+
+ 
+
+There
+are no foreign exchange controls or foreign exchange regulations under current applicable laws of the various places of incorporation
+of our significant subsidiaries that would affect the payment or remittance of dividends. As a holding company, we will rely on
+dividends and other distributions on equity paid by Trendic International Limited, being the Company s operating subsidiary in
+Hong Kong ("Trendic") for our cash and financing requirements. We are permitted under the laws of the Cayman Islands
+and our Memorandum and Articles of Association (as amended from time to time) to provide funding to Trendic through loans or capital
+contributions. Trendic is permitted under the laws of Hong Kong to provide funding to the Company through dividend distribution without
+restrictions on the amount of the funds. If Trendic incurs debt on its own behalf in the future, the instruments governing such debt
+may restrict their ability to pay dividends to us. As of the date of this prospectus, Trendic has not experienced any difficulties or
+limitations on its ability to pay dividends; nor does it maintain cash management policies or procedures dictating the amount of such
+funding or how funds are transferred. For the year ended March 31, 2024, Trendic declared and paid a dividend of HK$5,500,000 to its
+shareholders. The Company does not intend to distribute any dividends immediately after the offering as the Company plans to retain earnings
+for growth in its operations. There can be no assurance that the PRC government will not impose restrictions to prevent the cash maintained
+in Hong Kong from being transferred out or restrict the deployment of the cash into our business or for the payment of dividends. See
+"Recent Regulatory Developments in the PRC" on pages 9 to 12 of this prospectus and "Risks Relating to Doing Business
+in Hong Kong" stating on page 33 of this prospectus.
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+The Basic Law came into
+effect on July 1, 1997. It is the constitutional document of Hong Kong, which sets out the basic policies of the People s Republic
+of China (including Hong Kong Special Administrative Region and Macao Special Administrative Region, except references to specific laws
+or regulations in the People s Republic of China within this Registration Statement shall exclude Hong Kong Special Administrative
+Region and Macao Special Administrative Region), or PRC or China, regarding Hong Kong. Pursuant to the Basic Law, national laws adopted
+by the PRC shall generally not be applied in Hong Kong, except for serval specific circumstances relating to the national flag, national
+anthem, and diplomatic privileges and immunities. Despite the foregoing, the legal and operational risks of operating in China also apply
+to businesses operating in Hong Kong and Macau. There is a risk that there be a change in these policies, which could result in a material
+change in our operations and/or the value of the Class A Ordinary Shares we are registering for sale or could significantly limit or
+completely hinder our ability to offer or continue to offer securities to investors and cause the value of such Class A Ordinary Shares
+to significantly decline or be worthless.
+
+ 
+
+We are aware that recently,
+the government of mainland China initiated a series of regulatory actions and statements to regulate business operations in certain areas
+in mainland China with little advance notice, including cracking down on illegal activities in the securities market, enhancing supervision
+over mainland Chinese companies listed overseas using a VIE structure, adopting new measures to extend the scope of cybersecurity reviews,
+and expanding the efforts in anti-monopoly enforcement. Since these statements and regulatory actions are new, it is highly uncertain
+how soon the legislative or administrative regulation making bodies will respond and what existing or new laws or regulations or detailed
+implementations and interpretations will be modified or promulgated, if any. In addition, due to long arm provisions under the current
+laws and regulations of mainland China, there remains regulatory uncertainty with respect to whether in the future we will be required
+to obtain permissions or approvals from the authorities of mainland China to operate our business or to list our securities on the U.S.
+exchanges and offer securities.
+
+ 
+
+We do not expect to be
+subject to the cybersecurity review by the China Securities Regulatory Commission, or CSRC, and the Cyberspace Administration of China,
+or CAC, in relation to this offering, given that: (1) Trendic is incorporated in Hong Kong and is located in Hong Kong; it is not a PRC
+domestic company, (2) we have no subsidiary, variable interest entity, or VIE, structure or any direct operations in mainland China,
+and (3) pursuant to the Basic Law of the Hong Kong Special Administrative Region of the People s Republic of China, or Basic Law,
+which is the constitutional document for Hong Kong, national laws of the PRC shall not be applied in Hong Kong, except for those listed
+in Annex III of the Basic Law (which is confined to laws relating to defense and foreign affairs, as well as other matters outside the
+autonomy of Hong Kong). Because our operations are in Hong Kong, a special administrative region of China, our business is subject to
+the complex and rapidly evolving laws and regulations there. However, in light of recent events indicating greater oversight by the CAC
+over data security, particularly for companies seeking to list on a foreign exchange, we may be subject to a variety of PRC laws and
+other obligations regarding data protection and any other rules, and any failure to comply with applicable laws and obligations could
+have a material and adverse effect on our business and the offering. We may become subject to PRC laws or Hong Kong regulations relating
+to the collection, use, sharing, retention, security, and transfer of confidential and private information, such as personal information
+and other data. In the event of a failure to comply, we may be required to suspend our relevant businesses and become subject to fines
+and other penalties, which may materially and adversely affect our financial condition. In addition, given the recent events indicating
+greater oversight by the CAC over data security, particularly for companies seeking to list on a foreign exchange, it remains uncertain
+as to how any such regulatory measures will be interpreted or implemented. See more detailed discussion of this risk factor on page 36
+of this prospectus. The Chinese government may exercise significant oversight and discretion over the conduct of our business and may
+intervene in or influence our operations at any time, which could result in a material change in our operations and/or the value of our
+Class A Ordinary Shares.
+
+ 
+
+We do not currently expect
+the Measures for Cybersecurity Review (2021) and the PRC Personal Information Protection Law to have an impact on our business, operations
+or this offering as we do not believe that Trendic would be deemed to be an "Operator" on the basis that (i) Trendic is incorporated
+in Hong Kong and is not a PRC domestic company. It operates in Hong Kong without any subsidiary or VIE structure in mainland China, and
+each of the Measures for Cybersecurity Review (2021) and the PRC Personal Information Protection Law remains unclear whether it shall
+be applied to a company based in Hong Kong; (ii) as of date of this prospectus, Trendic has in aggregate collected and stored personal
+information of less than one million users, and that data processed in our business does not have a bearing on national security and
+thus may not be classified as core or important data by the authorities; (iii) all of the data Trendic has collected is stored in servers
+located in Hong Kong; and (iv) as of the date of this prospectus, Trendic has not been informed by any PRC governmental authority of
+any requirement that it should file for a cybersecurity review or a CSRC review. An "Operator" is required to file for cybersecurity
+review before listing in the United States.
+
+ 
+
+We also do not expect to
+be subject to the Trial Administrative Measures of Overseas Securities Issuance and Listing by Domestic Enterprises of the PRC, or the
+Trial Overseas Listing Measures, in relation to this offering. On February 17, 2023, the CSRC promulgated a circular on the Administrative
+Arrangements for Filing of Securities offering and Listing By Domestic Companies and released a set of new regulations which include
+the Trial Administrative Measures of Overseas Securities offering and Listing by Domestic Companies, or the Trial Overseas Listing Measures,
+and five supporting guidelines. The Trial Overseas Listing Measures do not apply to us because we are not a PRC domestic company.
+
+ 
+
+There are no foreign
+exchange controls or foreign exchange regulations under current applicable laws of the various places of incorporation of our
+significant subsidiaries that would affect the payment or remittance of dividends. As a holding company, we will rely on dividends
+and other distributions on equity paid by Trendic, being the Company s wholly-owned operating subsidiary in Hong Kong for our
+cash and financing requirements. Trendic is permitted under the laws of Hong Kong to provide funding to the Company through dividend
+distribution without restrictions on the amount of the funds. If Trendic incurs debt on its own behalf in the future, the
+instruments governing such debt may restrict their ability to pay dividends to us. For the year ended March 31, 2024, Trendic
+declared and paid a dividend of HK$5,500,000 to its shareholders.
+
+ 
+
+As of the date of this
+prospectus, our Company and its subsidiaries have not received any inquiry, notice, warning, or sanctions regarding our planned overseas
+listing from the CSRC or any other PRC governmental authorities. None of our business activities appears to be within the immediate targeted
+areas of concern by the Chinese government.
+
+ 
+
+The
+date of this prospectus is , 2025
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+
+RESALE
+PROSPECTUS ALTERNATE PAGE
+
+ 
+
+TABLE
+OF CONTENTS
+
+ 
+
+ 
+ 
+ Page
\ No newline at end of file
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new file mode 100644
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--- /dev/null
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/TGNT_totaligent_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/TGNT_totaligent_prospectus_summary.txt
new file mode 100644
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@@ -0,0 +1,505 @@
+PROSPECTUS SUMMARY
+ 
+This summary highlights information contained elsewhere in this prospectus and does not contain all of the information that you should consider in making your investment decision. Before investing in our Common Stock, you should carefully read this entire prospectus, including our financial statements and the related notes and the information set forth under the headings Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations included elsewhere in this prospectus and our consolidated financial statements and the accompanying notes included in this prospectus. Except as otherwise indicated herein or as the context otherwise requires, references in this prospectus to Totaligent, the Company, we, us, and our refer to Totaligent, Inc. 
+ 
+Company Overview
+ 
+Totaligent is a person-based digital marketing platform that allows companies and individuals to use and unlock owned and acquired data to efficiently market their products, services, and brands. By leveraging our platform tools, users can deploy an all-encompassing digital communications strategy.
+ 
+We offer managed campaigns to publicly traded companies and political candidates. We launched the beta version of our consumer-facing person-based digital marketing platform on March 5, 2025. Our managed campaign business will be the main driver of revenue until the public launch of the consumer platform.
+ 
+Our white-label programmatic ad platform is directly connected to our own custom Database Management Platform ( DMP ), which allows micro-targeting using data matching, which can be site specific, area specific and/or zip code specific. This platform leverages highly efficient display advertising, as opposed to general search engine keyword advertising. The platform is connected to more than 40 network publishers, giving users a deep network of web portals in all verticals.
+ 
+Our team is continuously updating the platform to follow the ever-changing advertising rules implemented by Google, LinkedIn, Meta, X and others, regarding advertising crypto, drugs, tobacco, firearms, sex, and political advertising. Our customer outreach tools include email, SMS, and push notification.
+ 
+ 
+ 
+Email marketing on the Totaligent platform connects to most of the known email marketing Electronic Services Portals ( ESP ).
+
+ 
+ 
+ 
+
+ 
+ 
+Short Message Service ( SMS ) connects to multiple telecom partners allowing users to choose deliverability and the best price for their messaging needs. We offer long code, short code, and 1-800s.
+
+ 
+ 
+ 
+
+ 
+ 
+Push notification marketing utilizes the Totaligent smart code (cookie), which allows customers to receive push notifications for upcoming news, offers, events, and more, all managed internally on Totaligent s Push servers.
+
+ 
+Individual Totaligent services are currently operational and used for our managed campaign program. Upon the launch of the consumer-facing platform, the full spectrum of our digital communication tools will operate within the same User Interface XML ( UIX ), negating the need for multiple service providers or Customer Relationship Management ( CRM ) tools to perform various individual tasks. Users will be able to harmonize every facet of a digital campaign from a single panel, allowing multichannel marketing and analytics to maximize communication and ROI from the user s customer and visitor databases. 
+ 
+Industry Overview
+ 
+Digital Marketing and Programmatic Advertising 
+ 
+The digital marketing industry is experiencing rapid evolution, driven by the convergence of data-driven strategies, advanced technology platforms, and the increasing need for personalized consumer engagement. As businesses and individuals strive to cut through the noise in an oversaturated market, platforms like Totaligent are becoming increasingly critical. Totaligent is a person-based digital marketing platform that enables companies to harness both owned and acquired data to deliver targeted, efficient marketing campaigns. By offering a comprehensive suite of tools, we empower users to deploy all-encompassing digital communication strategies that resonate with their target audiences.
+ 
+ 
+8
+
+Table of Contents
+ 
+The Shift Towards Person-Based Marketing 
+ 
+In recent years, the industry has shifted from broad, demographic-based targeting to more precise, person-based marketing. This approach leverages detailed consumer data to deliver personalized experiences across multiple channels. Our platform is designed to meet this demand, providing users with the ability to micro-target audiences using a custom Database Management Platform (DMP). This platform allows for site-specific, area-specific, and zip code-specific targeting, ensuring that marketing efforts reach the most relevant consumers.
+ 
+Person-based marketing is particularly valuable in today s landscape, where consumers expect tailored experiences. By connecting directly with more than 40 network publishers, we offer a vast network of web portals across various verticals. This enables users to deliver highly efficient display advertising, which is increasingly favored over traditional keyword-based search engine advertising. We believe that the result will be more effective campaigns and will drive higher engagement and return on investment (ROI).
+ 
+Managed Campaigns and Revenue Streams 
+ 
+Our business model is currently anchored by our managed campaign services, which cater to publicly traded companies and political candidates. These campaigns, which utilize the platform s robust micro-targeting capabilities, are a significant revenue driver. The managed campaigns offer clients a full-service solution, leveraging our expertise in navigating the complex and often changing regulations surrounding digital advertising, including those related to sensitive sectors like crypto, drugs, and political advertising.
+ 
+While we launched the beta version of our consumer-facing platform on March 5, 2025, the managed campaign business will continue to be the primary revenue source. However, the consumer platform represents a significant growth opportunity, as it will allow a broader range of users to access our sophisticated marketing tools. This expansion into the consumer market is expected to diversify our revenue streams and position us for long-term success.
+ 
+Integration and Automation: The Future of Digital Marketing
+ 
+One of the key differentiators of our platform is our focus on integration and automation. The platform s white-label programmatic ad capabilities are seamlessly connected to our DMP, enabling users to manage and optimize campaigns from a single interface. This integration negates the need for multiple service providers or Customer Relationship Management (CRM) tools, streamlining the digital marketing process.
+ 
+We also offer a comprehensive set of customer outreach tools, including email, SMS, and push notifications. These tools are designed to be easily accessible through the platform s unified User Interface XML (UIX), allowing users to harmonize their marketing efforts across different channels. The ability to manage multichannel campaigns from a single panel not only enhances efficiency but also maximizes the impact of marketing efforts by providing a cohesive customer experience.
+ 
+Adapting to Industry Changes 
+ 
+The digital marketing landscape is constantly evolving, with new regulations and platform policies frequently altering the rules of engagement. Our commitment to continuous platform updates ensures that users can navigate these changes with ease. The platform is designed to stay ahead of the curve, adapting to new guidelines from major players like Google, LinkedIn, Meta, and X.
+ 
+We believe that we are well-positioned to thrive in the dynamic digital marketing industry. By offering a person-based approach to marketing, coupled with powerful integration and automation tools, Totaligent enables users to execute highly effective campaigns that drive meaningful results. As we expand our consumer-facing platform, we believe that we are poised to become a leader in the digital marketing space, providing both businesses and individuals with the tools they need to succeed in an increasingly competitive environment.
+ 
+ 
+9
+
+Table of Contents
+ 
+Here are some compelling statistics and forecasts that support the information presented about Totaligent and the digital marketing industry:
+ 
+ 
+1.
+Growth of Digital Marketing: Statista projects the global digital advertising market to reach $790 billion in 2024 and $798.7 billion in 2025. This growth underscores the increasing reliance on digital channels for marketing and highlights the potential market for platforms like Totaligent.
+
+ 
+ 
+ 
+
+ 
+2.
+Shift to Person-Based Marketing: According to Mailmodo, personalized marketing continues to be a critical strategy, with research indicating that such approaches can boost conversion rates by up to 202%. As consumers demand more tailored experiences, the shift towards person-based marketing becomes essential, making Totaligent s platform, which offers micro-targeting, highly relevant.
+
+ 
+ 
+ 
+
+ 
+3.
+Programmatic Advertising Dominance: In 2024, programmatic advertising continues to dominate the digital advertising landscape in the United States, accounting for approximately 91.3% of digital display ad spending. Total U.S. programmatic digital display ad spending reached $156.82 billion in 2024, reflecting a 15.2% year-over-year growth, according to eMarketer. This trend highlights the importance of programmatic platforms like Totaligent s, which can efficiently reach targeted audiences
+
+ 
+ 
+ 
+
+ 
+4.
+Email Marketing ROI: For every $1 marketers spend on email marketing, they receive $36 in return, according to Litmus. Totaligent s integration with known Email Service Providers (ESPs) positions it well to help users capitalize on this effective channel.
+
+ 
+ 
+ 
+
+ 
+5.
+SMS Marketing Growth: According to Data Bridge Market Research, the global SMS marketing market was valued at approximately $8.223 billion in 2022 and is projected to reach $38.442 billion by 2030, growing at a CAGR of 21.26% from 2023 to 2030. Totaligent s SMS capabilities align with this growing trend, offering users a powerful tool for customer engagement.
+
+ 
+ 
+ 
+
+ 
+6.
+Push Notification Engagement: Push notifications in 2024 maintain high engagement and can achieve up to 40% CTR with optimization strategies like personalization, rich media, and tailored timing, states NotifyVisitors. Totaligent s smart code for push notifications allows users to tap into this highly engaging channel.
+
+ 
+These statistics and forecasts emphasize the relevance and potential of our platform in a rapidly growing and evolving digital marketing landscape. 
+ 
+Market Opportunity
+ 
+We believe that the market opportunity for Totaligent within the digital marketing industry is substantial, driven by several key factors:
+ 
+Expanding Digital Advertising Market
+ 
+According to Cognitive Market Research, the global Digital Ad Spending market size will be USD 621.45 billion in 2024. It will expand at a compound annual growth rate (CAGR) of 9.00% from 2024 to 2031. This expansion underscores the shift of advertising budgets from traditional to digital channels, presenting platforms like Totaligent, which offer advanced targeting and integration tools, with a substantial opportunity to capture a significant share of this burgeoning market.
+ 
+Rising Demand for Person-Based Marketing
+ 
+Consumers increasingly expect personalized and relevant content, leading to a heightened demand for person-based marketing strategies. Studies have shown that personalized marketing can boost conversion rates by over 200%. We believe that our platform, which enables micro-targeting based on detailed consumer data, is well-positioned to capitalize on this trend, offering businesses the tools to deliver tailored experiences that meet consumer expectations.
+ 
+ 
+10
+
+Table of Contents
+ 
+Growth in Programmatic Advertising
+ 
+Programmatic advertising continues to dominate the digital display ad market. U.S. programmatic digital display ad spend will total $156.82 billion in 2024, according to a June 2024 eMarketer s forecast. We believe that our white-label programmatic ad platform, connected to a broad network of publishers, offers a significant opportunity to tap into this market. As more advertisers move towards automated, data-driven ad buying, we believe that our platform can attract a wide range of users seeking efficient and effective advertising solutions. 
+ 
+Opportunities in Email, SMS, and Push Notification Marketing
+ 
+Email marketing continues to deliver high ROI, while SMS and push notification marketing are experiencing rapid growth. Data Bridge Market Research projects the SMS marketing market will grow at a CAGR of 21.26% during the forecast period of 2023 to 2030. Totaligent s integrated tools for email, SMS, and push notifications allow users to engage customers across multiple channels, creating a comprehensive marketing solution that meets diverse needs. The ability to offer these services within a single platform enhances the value proposition for businesses seeking to streamline their digital marketing efforts.
+ 
+Regulatory and Market Adaptation
+ 
+As digital advertising becomes more regulated, particularly in areas like political advertising, crypto, and other sensitive sectors, platforms that can adapt quickly to these changes will have a competitive advantage. We believe that our commitment to continuously updating its platform to comply with new regulations provides a significant opportunity to attract clients in regulated industries that require compliant marketing solutions.
+ 
+Expansion into the Consumer Market
+ 
+We believe that the launch of our consumer-facing platform on March 5, 2025 represents a major growth opportunity. By making our sophisticated marketing tools accessible to a broader audience, including small businesses and individual marketers, we can tap into a vast and underserved segment of the market. We believe that this expansion could significantly diversify revenue streams and drive long-term growth.
+ 
+Growth and Development Strategy
+ 
+To capitalize on the substantial market opportunity in digital marketing, we have outlined a comprehensive growth strategy that includes targeted marketing efforts, brand development, and strategic acquisitions. By leveraging our existing strengths in person-based digital marketing and programmatic advertising, we aim to scale our operations, diversify revenue streams, and become a leader in the industry.
+ 
+1. Marketing Strategy
+ 
+Channel Partners/Influencers We can expand our reach by building a network of channel partners and influencers within the digital marketing space. Many industries have used influencers to promote brands, and we can develop a similar network of influencers, including digital marketing experts, tech bloggers, and social media personalities. These influencers would promote our platform through content that showcases our unique capabilities, such as micro-targeting and multichannel integration. Influencers would be compensated on a performance basis, creating a scalable and cost-effective marketing model.
+ 
+Digital Marketing Platform Development We plan to continue to innovate and expand our platform capabilities. By focusing on the development of new features that address the evolving needs of digital marketers, such as enhanced data analytics, AI-driven campaign optimization, and improved user interface design, we hope to attract and retain a growing customer base. We believe that our commitment to staying ahead of regulatory changes will also be a significant differentiator in the market.
+ 
+ 
+11
+
+Table of Contents
+ 
+2. Brand Development
+ 
+We plan to focus on building a strong brand identity as a leading provider of person-based digital marketing solutions. This involves not only expanding our product offerings but also establishing Totaligent as a thought leader in the industry.
+ 
+Expanding Platform Offerings We plan to continuously enhance our platform by integrating new features that align with market trends, such as AI-driven personalization, enhanced data privacy tools, and cross-channel campaign management. We believe that this will allow us to meet the diverse needs of our customers and stay ahead of competitors.
+ 
+Strategic Partnerships Aligning with high-profile partners, such as major digital ad networks, data providers, and tech companies, will enhance our brand credibility. These partnerships will also provide additional channels for customer acquisition and brand exposure. 
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+3. Acquisitions Strategy
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+We intend to pursue strategic acquisitions to accelerate growth, expand our capabilities, and strengthen our market position. This strategy will focus on three key areas:
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+Existing Digital Marketing Brands We will target emerging digital marketing platforms and agencies that have demonstrated initial market penetration and potential for growth. By acquiring these companies, we can quickly expand our customer base, enhance our service offerings, and increase market share.
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+Technology Acquisitions To complement our platform, we will seek to acquire innovative technologies that enhance data analytics, customer engagement, and programmatic advertising capabilities. These acquisitions will provide us with additional tools to offer more comprehensive solutions to our clients, driving higher customer satisfaction and loyalty.
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+Distribution and Data Assets We will explore opportunities to acquire data providers and distribution platforms that can enhance our targeting capabilities. This could include acquiring companies with extensive consumer data or advanced targeting algorithms that can be integrated into our DMP. Additionally, acquiring companies with strong distribution networks will allow us to expand our reach and offer more robust services to our clients.
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+We aim to capitalize on the expanding digital marketing industry, leveraging our strengths in person-based marketing, programmatic advertising, and multichannel integration. Through targeted marketing efforts, brand development, and strategic acquisitions, we believe that we will be poised to scale our operations, diversify our revenue streams, and solidify our position as a market leader in digital marketing solutions.
+ 
+Standby Equity Purchase Agreement
+ 
+On April 25, 2025, we entered into the SEPA with the Selling Stockholder. Pursuant to the SEPA, the Company has the right to sell to the Selling Stockholder up to $3 million of its shares of common stock, subject to certain limitations and conditions set forth in the SEPA, from time to time during the term of the SEPA. Sales of the shares of common stock to the Selling Stockholder under the SEPA, and the timing of any such sales, are at the Company s option, and the Company is under no obligation to sell any shares of common stock to the Selling Stockholder under the SEPA.
+ 
+We have filed the registration statement of which this prospectus forms a part with the Securities and Exchange Commission (the SEC ) to register under the Securities Act the resale by the Selling Stockholder of up to 100,000,000 shares of common stock, consisting of an aggregate amount of 2,500,000 Commitment Shares and up to 97,500,000 shares of common stock that we may elect, in our sole discretion, to issue and sell to the Selling Stockholder, from time to time under the SEPA. From time to time at our discretion for the two year period after the date of the SEPA, upon the satisfaction of the conditions to the Selling Stockholder s purchase obligation set forth in the SEPA, including that the registration statement of which this prospectus forms a part be declared effective by the SEC and the final form of this prospectus is filed with the SEC, we will have the right, but not the obligation to direct the Selling Stockholder to purchase a specified number of shares of common stock (each such sale, an Advance ) by delivering written notice to the Selling Stockholder (each, an Advance Notice ). Under the SEPA there is a minimum amount of $25,000 for any advance, and any advance may not exceed the greater of $100,000 or 200% of the average of the daily trading volume of the common stock on the five consecutive trading days immediately preceding an Advance Notice. The per share purchase price for the shares of common stock, if any, that we elect to sell to the Selling Stockholder in an Advance pursuant to the Purchase Agreement will be determined by reference to the volume weighted average price of our common stock (the VWAP ) and calculated on the basis of 75% of the five-day VWAP prior to the date of the Advance Notice; provided, however, that the Company may establish a minimum acceptable price in certain Advance Notices, as specified in the SEPA, below which it shall not be obligated to make any sales to the Selling Stockholder. There is no upper limit on the price per share that the Selling Stockholder could be obligated to pay for the common stock we may elect to sell to it in any Advance. We will control the timing and amount of any sales of common stock to the Selling Stockholder. Actual sales of shares of our common stock to the Selling Stockholder under the SEPA will depend on a variety of factors to be determined by us from time to time, which may include, among other things, market conditions, the trading price of our common stock, and determinations by us as to the appropriate sources of funding for our business and its operations.
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+In addition to the satisfaction of the conditions, the Selling Stockholder shall not be obligated to purchase or acquire, and shall not purchase or acquire, any common stock under the SEPA which, when aggregated with all other common stock beneficially owned by the Selling Stockholder and its affiliates, would result in the beneficial ownership by the Selling Stockholder and its affiliates (on an aggregated basis) of a number of shares of common stock exceeding 4.99% of the then outstanding voting power or number of common shares. In addition, in no event shall an Advance exceed the number of common shares registered in respect of the transactions contemplated hereby under the registration statement then in effect.
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+As consideration for the Selling Stockholder s commitment to purchase shares of common stock at our direction upon the terms and subject to the conditions set forth in the SEPA, upon execution of the SEPA, we issued 2,500,000 Commitment Shares to the Selling Stockholder. 
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+The SEPA will automatically terminate on the earliest to occur of (i) 24-month anniversary of the date of the SEPA or (ii) the date on which the Selling Stockholder shall have purchased from us under the Purchase Agreement shares of our common stock for an aggregate gross purchase price of $3,000,000. We have the right to terminate the SEPA at no cost or penalty upon five trading days prior written notice to the Selling Stockholder; provided that there are no outstanding Advance Notices. We and the Selling Stockholder may also agree to terminate the SEPA by mutual written consent. Neither we nor the Selling Stockholder may assign or transfer our respective rights and obligations under the SEPA, and no provision of the SEPA may be modified or waived by us or the Selling Stockholder other than by an instrument in writing signed by both parties.
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+The SEPA contains customary representations, warranties, conditions, and indemnification obligations of the parties. The representations, warranties and covenants contained in such agreements were made only for purposes of such agreements and as of specific dates, were solely for the benefit of the parties to such agreements and may be subject to limitations agreed upon by the contracting parties.
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+The net proceeds received by the Company under the SEPA will depend on the frequency and prices at which the Company sells its shares of common stock to the Selling Stockholder. The Company expects that any proceeds received from such sales to the Selling Stockholder will be used for working capital and general corporate purposes. The Selling Stockholder has agreed that it and its affiliates will not engage in any short sales of the common stock nor enter into any transaction that establishes a net short position in the common stock during the term of the SEPA.
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+If and when we elect to issue and sell shares to the Selling Stockholder under the SEPA, we may need to register for resale under the Securities Act additional shares of our common stock in order to receive aggregate gross proceeds equal to the $3,000,000 available to us under the SEPA, depending on market prices for our common stock. If all of the 97,500,000 shares offered by the Selling Stockholder for resale under the registration statement of which this prospectus forms a part were issued and outstanding as of the date hereof (without taking into account the 4.99% Ownership Limitation), such shares would represent approximately 32.2% of the total number of shares of our common stock outstanding as of April 25, 2025 exclusive of the shares of Common Stock issuable pursuant to the conversion of our Series D Convertible Preferred Stock. If we elect to issue and sell more than the 97,500,000 shares offered under this prospectus to the Selling Stockholder, which we have the right, but not the obligation, to do, we must first register for resale under the Securities Act any such additional shares, which could cause substantial additional dilution to our stockholders. The number of shares ultimately offered for resale by the Selling Stockholder is dependent upon the number of shares we may elect to sell to the Selling Stockholder under the SEPA.
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+There are substantial risks to our stockholders as a result of the sale and issuance of common stock to the Selling Stockholder under the SEPA. These risks include the potential for substantial dilution and significant declines in our stock price. See the section entitled Risk Factors-Risks Related to this Offering. Issuances of our common stock in this offering will not affect the rights or privileges of our existing stockholders, except that the economic and voting interests of each of our existing stockholders will be diluted as a result of any such issuance. Although the number of shares of common stock that our existing stockholders own will not decrease as a result of sales, if any, under the SEPA to the Selling Stockholder, the shares owned by our existing stockholders will represent a smaller percentage of our total outstanding shares after any such issuance to the Selling Stockholder.
+ 
+The Selling Stockholder is wholly owned by Ben Hansel, a former Director of the Company.
+ 
+Summary of Risk Factors
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+As an OTC Pink Market listed Company, we have limited resources with pressing capital requirements as we attempt to ramp up production. We are mindful of the challenges involved in achieving growth without compromising our ability to manage our operating risks and comply with rules and regulations. As we are commercializing a new technology, no one is in a position to know all of the risks, obstacles, and hurdles that the Company will face as it works to commercialize its new technology. Any investment in our securities involves a high degree of risk. We are aware of numerous risks associated with our business, including:
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+We are in our development stage and have a limited operating history.
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+Our independent registered public accounting firm has expressed substantial doubt as to our ability to continue as a going concern in its report.
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+We will need to raise additional capital to support our operations.
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+We anticipate operating losses to continue into the foreseeable future and substantial additional capital may be required that may not be available on acceptable terms.
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+Our future revenue and operating results are unpredictable and may fluctuate significantly.
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+If demand for our products and services does not develop as expected our projected revenues and profits will be affected.
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+If we fail to acquire and retain new customers, or fail to do so in a cost-effective manner, we may be unable to increase net revenues, improve margins and achieve profitability.
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+We may not be able to manage future growth effectively.
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+A failure or breach of our security systems or infrastructure as a result of cyberattacks could disrupt our business, result in the disclosure or misuse of confidential or proprietary information, damage our reputation, increase our costs and cause losses.
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+Current market conditions and recessionary pressures in one or more of the Company s markets could impact our ability to grow our business.
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+We will face growing regulatory and compliance requirements which can be costly and time consuming.
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+Intellectual Property may be threatened or become obsolete.
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+Our competitors are well-funded and have large customer bases.
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+Our business could be negatively impacted by changes in the U.S. political environment.
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+Failure to comply with data privacy and security laws and regulations could adversely affect our operating results and business.
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+Our business depends on our customers continued and unimpeded access to the Internet and the development and maintenance of Internet infrastructure. Internet access providers may be able to block, degrade or charge for access to certain of our services, which could lead to additional expenses and the loss of customers.
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+Our business could be affected by new governmental regulations regarding the Internet.
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+If we fail to maintain an effective system of disclosure controls and internal control over financial reporting, our ability to produce timely and accurate financial statements or comply with applicable regulations could be impaired.
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+Industry and other market data used in this or other periodic reports that we have filed or will in the future file with the SEC, including those undertaken by us or our engaged consultants, may not prove to be representative of current and future market conditions or future results.
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+It is not possible to predict the actual number of shares we will sell under the SEPA to the Selling Stockholder, or the actual gross proceeds resulting from those sales.
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+Investors who buy shares at different times will likely pay different prices.
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+Our management team will have broad discretion over the use of the net proceeds from our sale of shares of Common Stock to the Selling Stockholder, if any, and you may not agree with how we use the proceeds, and the proceeds may not be invested successfully.
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+Our stock price may be volatile, and purchasers of our common stock could incur substantial losses.
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+If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, the market price for the shares and trading volume could decline. 
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+We have never paid cash dividends on our stock and do not intend to pay dividends for the foreseeable future.
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+Raising additional capital may cause dilution to our stockholders or restrict our operations.
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+We may issue additional debt and equity securities, which are senior to our common stock as to distributions and in liquidation, which could materially adversely affect the market price of our common stock.
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+We are a smaller reporting company within the meaning of the Securities Act, and if we take advantage of certain exemptions from disclosure requirements available to smaller reporting companies, this could make our securities less attractive to investors and may make it more difficult to compare our performance with other public companies. We are also a voluntary filer.
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+Future sales of substantial amounts of our common stock or securities convertible into or exchangeable or exercisable for shares of common stock, either by us or by our existing stockholders, or the possibility that such sales could occur, could adversely affect the market price of our common stock.
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+Shares eligible for future sale may have adverse effects on our share price.
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+Future sales of additional shares of our Common Stock or securities convertible into shares of our Common Stock may dilute our shareholders ownership in us and may adversely affect us or the trading price of our Common Stock.
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+Future sales of shares of our Common Stock could lower the trading price of our Common Stock, and any additional capital raised by us through the sale of additional equity including pursuant to the SEPA or convertible debt securities may dilute our shareholders ownership in us and may adversely affect us or the trading price of our Common Stock.
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+The loss of liquidity could adversely impact a stockholder s ability to sell Shares.
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+Corporate Information
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+Totaligent, Inc. is a Delaware corporation. Our Common Stock is quoted on the OTC Pink Market under the ticker symbol TGNT .
+ 
+As of April 25, 2025, there are 211,251,063 shares of Common Stock issued and outstanding and 576,562 shares of Series D Preferred Stock, which are convertible into 576,562,000 shares of Common Stock. Edward DeFeudis, our Chief Executive Officer, owns directly and indirectly 139,000 shares of our Series D Preferred Stock and 13,276,086 shares of our Common Stock, which represents in the aggregate 19.33% of the Company s Capital Stock on a fully diluted basis. (See, Description of Securities for additional information about our securities).
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+Our principal executive office and mailing address is 3651 FAU Blvd., Suite 400 Boca Raton, FL 33431. Our telephone number is (561) 360-3565. Our corporate website is https://www.totaligent.com/. The information contained on, or that can be accessed through, our website is not part of, and is not incorporated by reference into, this prospectus and should not be relied upon with respect to this offering.
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+Prospectus Summary 1
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+This summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under Risk Factors and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: we, us or our company refer to Talon Capital Corp.; amended and restated memorandum and articles of association refer to the amended and restated memorandum and articles of association of the company which will be adopted prior to the consummation of this offering; Companies Act are to the Companies Act (As Revised) of the Cayman Islands; completion window are to (i) the period ending on the date that is 24 months from the closing of this offering, or such earlier liquidation date as our board of directors may approve, in which we must complete an initial business combination or (ii) such other time period in which we must complete an initial business combination pursuant to an amendment to our amended and restated memorandum and articles of association. Our shareholders can also vote at any time to amend our amended and restated memorandum and articles of association to modify the amount of time we will have to complete an initial business combination, in which case our public shareholders will be offered an opportunity to redeem their public shares; FINRA are to the Financial Industry Regulatory Authority; founder shares are to our Class B ordinary shares initially purchased by our Sponsor in a private placement prior to this offering and, unless the context otherwise requires, our Class A ordinary shares issued upon the conversion thereof as provided herein; initial shareholders refer to the Sponsor and any other holders of our founder shares immediately prior to this offering; letter agreement refers to the letter agreement between us and each of our Sponsor, directors and officers, the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part; management or our management team refer to our directors and executive officers; ordinary shares are to our Class A ordinary shares and our Class B ordinary shares; permitted transferees refer to permitted transferees as described under section Principal Shareholders of this prospectus; private placement shares refer to 755,000 Class A ordinary shares (or 788,750 Class A ordinary shares if the over-allotment is exercised in full) to be purchased by the Sponsor and the representative as part of the private placement units in a private placement that will close simultaneously with this offering (530,000 of such shares by the Sponsor and 225,000 (or 258,750 if the over-allotment is exercised in full) of such shares by the representative); private placement units are to the 530,000 private placement units and 225,000 private placement units (or 258,750 private placement units if the over-allotment is exercised in full) being purchased separately by our Sponsor and the representative, respectively, in a private placement that will close simultaneously with this offering, as well as any units that may be issued upon conversion of working capital loans, each private placement unit consisting of one private placement share and one-third of one private placement warrant; 1 Table of Contents private placement warrants refer to an aggregate of 251,666 warrants (or 262,916 warrants if the over-allotment is exercised in full) to be purchased by the Sponsor and the representative as part of the private placement units in private placements that will close simultaneously with this offering (176,666 of such warrants by the Sponsor and 75,000 (or 86,250 if the over-allotment is exercised in full) of such warrants by the representative); public shares are to our Class A ordinary shares sold as part of the public units in this offering (whether they are purchased in this offering or thereafter in the open market); public shareholders refer to the holders of our public shares, including our initial shareholders, Sponsor (as defined below), executive officers and directors to the extent they purchase public shares, provided that their status as public shareholders shall only exist with respect to such public shares; public warrants are to the redeemable warrants sold as part of the units in this offering (whether they are subscribed for in this offering or in the open market); representative refers to Cohen and Company Capital Markets, a division of Cohen & Company Securities, LLC ( CCM ); Sponsor refers to Talon Capital Sponsor LLC, a company affiliated with our executive officers and directors; and warrants are to our redeemable warrants, which include the public warrants as well as the private placement warrants. All references in this prospectus to shares of the company being forfeited shall take effect as surrenders for no consideration of such shares as a matter of Cayman Islands law. Any conversion of the Class B ordinary shares described in this prospectus will take effect as a redemption of Class B ordinary shares and an issuance of Class A ordinary shares as a matter of Cayman Islands law. Any share dividend described in this prospectus will take effect as a share capitalization as a matter of Cayman Islands law. No fractional warrants will be issued upon separation of the units and only whole warrants will trade. Accordingly, unless you purchase at least two units, you will not be able to receive or trade a whole warrant. Unless we tell you otherwise, the information in this prospectus assumes that the underwriters will not exercise their over-allotment option. You should rely only on the information contained in this prospectus. We have not, and the underwriters have not, authorized anyone to provide you with different information. We are not, and the underwriters are not, making an offer of these securities in any jurisdiction where the offer is not permitted. General We are a newly organized blank check company or special purpose acquisition company, incorporated on May 1, 2025, as a Cayman Islands exempted company and formed for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, recapitalization, reorganization or other similar business combination with one or more businesses, which we refer to throughout this prospectus as our initial business combination. We have not selected any specific business combination target. To date, our efforts have been limited to organizational activities as well as activities related to this offering. Our efforts to identify a prospective target business will not be limited to a particular industry or geographic region, although we intend to focus on target businesses in the energy and power industries. Our Sponsor and its principals may from time to time become aware of potential business opportunities, one or more of which we may desire to pursue, for a business combination, but from the date of our incorporation through the date of this prospectus, there have been no substantive discussions, directly or indirectly, between any of our officers, directors, promoters and other affiliates on our behalf and any of their contacts or relationships regarding a potential initial business combination with our company. Additionally, we have not engaged or retained any agent or other representative to identify or locate any suitable acquisition candidate for us. We will seek to capitalize on the significant experience and contacts of our management team to complete our initial business combination. Our management team is led by Charlie Leykum, our Chairman and Chief Executive Officer, who has more than 20 years of experience in the traditional and renewable energy sectors, and Gerald 2 Table of Contents Cimador, our Chief Financial Officer, who has over 30 years of public and private accounting experience. Charles Leykum served as a director, and Gerald Cimador served as the Chief Financial Officer and Chief Accounting Officer, of Sentinel Energy Services Inc. ( Sentinel ), a former blank check company that raised $345 million in its initial public offering in November 2017. In October 2018, Sentinel announced a business combination with Strike Capital LLC, backed by $150 million in PIPE commitments. However, the deal was terminated in February 2019. In November 2019, Sentinel announced the liquidation of the trust account and redeemed all 34,500,000 of its outstanding public Class A ordinary shares. We intend to identify and acquire a business that could benefit from hands-on management with extensive operational experience in the energy sector. We believe there are long-term secular tailwinds for the U.S. energy sector driven by growing demand from economic growth, industrial-reshoring, electrification and data centers. We are seeking opportunities that are uniquely positioned to support and benefit from these tailwinds to generate long-term shareholder value. We believe there are well-positioned companies that may present compelling value due to recent lack of capital markets formation and availability, legacy ownership groups that are seeking near-term liquidity events, historical underinvestment, a temporary period of dislocation in the markets in which they operate, over-levered capital structures, excessive cost structures, incomplete management teams and/or suboptimal business strategies. Our management team has extensive experience in identifying and executing such opportunities across the energy industry. Additionally, our team has significant hands-on experience working with private companies in preparing for and executing an initial public offering and serving as active owners and directors by working closely with these companies to continue their transformations and help create value in the public markets. We believe that our new SPAC is timely and relevant to support enhancement of public capital investments in growing and commercializing companies in the energy and power industry. We believe that our management team is well positioned to identify attractive risk-adjusted returns in the marketplace and that our deal sourcing channels, ranging from industry executives, private owners, private equity funds, and investment bankers, along with the expertise gained through involvement with the CSL Capital Management, L.P. ( CSL ) platform, will enable us to pursue a broad range of opportunities. Additionally, our management believes that its ability to identify and implement value creation initiatives will remain central to its differentiated acquisition strategy. We intend to primarily focus our target sourcing efforts on private companies that we believe would benefit from a public listing and partnership with our team and that otherwise cannot gain access to public capital in this current market environment. We believe that our management team s background and prior successes could have a significant short- and long-term impact on target businesses and offer a compelling opportunity for targets seeking an alternative path to liquidity and value maximalization. We will seek to capitalize on the 20+ years of experience in the energy sector of our Chairman and Chief Executive Officer, Charlie Leykum. Mr. Leykum is the Founder of CSL, a Houston-based private equity firm founded in 2008, specializing in energy services, power, and infrastructure companies. CSL has raised over $2.0 billion in equity capital and commitments across various investment vehicles. Mr. Leykum has built a track record of identifying strategic growth opportunities and generating long-term value through both private and public market investments. Prior to founding CSL in 2008, Mr. Leykum was a portfolio manager at Soros Fund Management LLC, where he oversaw investments in the energy sector. Before his time at Soros, he worked in the Principal Investment Area and the Investment Banking Division of Goldman Sachs & Co. LLC. Mr. Leykum currently also serves as Founder and Chairman of RNWBL, LLC, a leading independent provider of renewable services focusing on wind and solar power and has served on the board of directors of Ranger Energy Services, Inc (NYSE: RNGR ). Mr. Leykum was also a co-founder and sponsor of Sentinel Energy Services Inc., a SPAC focused on the energy sector, founded in 2017. Mr. Leykum currently serves as a director or advisor to several energy companies, and his investment leadership at CSL has helped grow multiple successful energy platforms in North America. Mr. Leykum graduated with a Bachelor of Arts in Economics from Columbia University and a Master of Business Administration from Harvard Business School. We believe that Mr. Leykum s extensive experience investing in the energy industry and serving as a director for several energy companies brings important and valuable skills to our board of directors. We will also seek to capitalize on the 30 years of experience in accounting of our Chief Financial Officer, Gerald Cimador. Mr. Cimador serves as Partner and Chief Financial Officer at CSL. Since joining CSL in May 2008, he has overseen all administrative and operational functions, including accounting, reporting, tax, and compliance, and 3 Table of Contents sits on the firm s investment committee. Prior to CSL, from 1999 to 2008, Mr. Cimador was the Controller at Moore Capital Management in New York, where he managed accounting and reporting for the investment manager and its subsidiaries. From 1997 to 1999, he served as Audit Manager of Ernst & Young LLP & Company. Mr. Cimador started his career as Audit Senior for Goldstein Golub Kessler & Co. from 1994-1997. Mr. Cimador served on the board of directors of Ranger Energy Services, Inc (NYSE: RNGR ). In addition to his role at CSL, Mr. Cimador served as Chief Financial Officer and Chief Accounting Officer of Sentinel Energy Services Inc. from its inception in 2017. He has a BBA in Accounting from Hofstra University. Mr. Cimador s extensive experience makes him a valuable addition to our management team. Our management team s objective is to generate attractive returns and create value for our shareholders by applying a disciplined strategy of underwriting intrinsic value and affecting operational improvements after acquiring to unlock value. We favor opportunities with certain elements of downside protection, for example, companies with multiple year contracts, proven infrastructure, good governance and credibility in the marketplace in which they operate. Our management team has successfully applied this approach and has deployed capital across various market cycles. With respect to the foregoing examples, the past performance of CSL, Mr. Leykum, Mr. Cimador and other members of our management team is not a guarantee either (i) of success with respect to any business combination we may consummate or (ii) that we will be able to identify a suitable candidate for our initial business combination. You should not rely on the historical record of CSL s or our management s performance as indicative of our future performance. Except as otherwise disclosed herein, none of our officers or directors have had experience with blank check companies or special purpose acquisition companies in the past. Market Opportunity We believe our team s extensive and diverse experience will help us to effectively evaluate targets across the traditional energy industry. We believe these industries are attractive for several reasons: Conventional Upstream The U.S. energy sector is undergoing a significant transformation, presenting a compelling market opportunity driven by structural shifts in power demand, natural gas consumption, aging infrastructure, and a constructive political environment. Natural gas continues to play a central role in the evolving energy landscape, serving as both a reliable baseload fuel and a critical enabler of renewable integration. According to the International Energy Agency, the U.S. remains the world s largest natural gas producer, and domestic consumption is expected to grow steadily through 2035, driven by increased demand from power generation, LNG exports, and industrial applications. According to the EIA s 2025 outlook, U.S. LNG export capacity is projected to nearly double by 2030, positioning the U.S. as a global swing supplier. We believe this growing demand, combined with supply volatility from geopolitical factors abroad, underscores the importance of continued investment in conventional upstream gas production and infrastructure. Power The U.S. National Power Demand Study projects that between 2024 and 2040, electricity demand in the U.S. will grow by 35 to 50% driven by a combination of underlying economic growth, large industrial loads like data centers and manufacturing, and the electrification of transport and heating. According to estimates from Deloitte in a 2024 report, electricity demand from data centers alone, fueled by Artificial Intelligence ( AI ) and Machine Learning, is projected to reach 515 to 720 terawatt hours ( TWh ) in 2030, up from 180 to 290 TWh in 2024. The rapidly rising power demand is expected to contribute to a corresponding rise in power generation across various power sources. Notably, natural gas, which currently generates about 43% of US electricity, is expected to rise by 3.5% by the end of 2025 according to estimates from Deloitte. 4 Table of Contents Products and Technologies Recent Federal policies have further amplified this demand surge by relocating offshore manufacturing and expanding domestic production. According to Deloitte, between January 1, 2021, and March 1, 2023, companies announced more than 150 onshore manufacturing facilities in the United States, with an annual electricity usage exceeding 13,000 GWh, half of which is expected to be operational by 2025. We believe the growing demand for technologies that reduce energy costs and improve energy efficiency, combined with increased capital allocation to meet rising power needs, creates an attractive landscape for disruptive technologies to gain traction. Infrastructure In addition, traditional energy infrastructure is aging rapidly, posing significant challenges in the face of surging energy demand and the global push toward more resilient energy systems. The American Society of Civil Engineers (ASCE) recently downgraded the energy sector s infrastructure grade to a D+, citing deteriorating conditions. To address these challenges, the energy sector is undergoing a transformation in operations and maintenance, shifting from reactive approaches to predictive strategies powered by tools such as AI. We believe this underscores the need for increased investment in the energy sector, as there is a need to both replace aging infrastructure and develop new systems. Capital Formation Despite these trends, we believe the conventional energy value chain has experienced underinvestment over the past several years, exacerbated by limited access to capital markets and a decline in energy-focused private equity formation and IPO activity. This capital scarcity has created attractive entry points into high-quality, cash-generative businesses with defensible moats and steep barriers to entry. Business Strategy Our acquisition and value creation strategy is to identify, acquire and, after our initial business combination, build a company in the energy services and equipment industry that complements the experience of our management team and that can benefit from our team s operational expertise. We expect our acquisition strategy to leverage our team s network of potential proprietary and public transaction sources where we believe a combination of our relationships, knowledge and experience in the energy services and equipment industry could effect a positive transformation or augmentation of existing businesses or properties to improve their overall value proposition. We plan to utilize the network and industry experience of our board of directors, including Mr. Leykum, and CSL in seeking an initial business combination and employing our acquisition strategy. Over the course of their careers, the members of our management team and their affiliates have developed a broad network of contacts and corporate relationships that we believe will serve as a useful source of acquisition opportunities. This network has been developed through our management team s extensive experience in both investing in and operating in the energy industry and we will leverage CSL s considerable experience. We expect these networks will provide our management team with a robust flow of acquisition opportunities. In addition, we anticipate that target business candidates will be brought to our attention from various unaffiliated sources, which may include investment market participants, private equity groups, investment banking firms, consultants, accounting firms and large business enterprises. Upon completion of this offering, we expect that members of our management team will communicate with their networks of relationships to articulate the parameters for our search for a target business and a potential business combination and begin the process of pursuing and reviewing potentially interesting leads. Acquisition Criteria Consistent with our business strategy, we have identified the following general criteria and guidelines that we believe are important in evaluating prospective targets for our initial business combination. We intend to use these criteria and guidelines in evaluating acquisition opportunities, but we may decide to enter into our initial business combination with a target that does not meet these criteria and guidelines. We intend to acquire a target business or businesses that we believe: are fundamentally sound but that we believe can achieve better results by leveraging the operating and financial experience of our sponsor team; 5 Table of Contents have substantial positive EBITDA, with a goal of building a consolidated platform and growing EBITDA through strategic aggregation and scaling; can utilize the extensive networks and insights that our sponsor has built in the energy services and equipment industry; are at an inflection point, including ownership transitions, shifting industry dynamics, and operational or structural repositioning; have defensible market positions, hard asset backing, and paths to scale through consolidation or organic growth; have a clear catalyst for re-rating, operational improvement, or strategic repositioning; exhibit unrecognized value or other characteristics, desirable returns on capital, and a need for capital to achieve the company s growth strategy, that we believe have been misevaluated by the marketplace based on our analysis and due diligence review; can enlarge their base of services and expand their geographical footprint; and will offer an attractive risk-adjusted return for our shareholders. We will seek to acquire the target on terms and in a manner that leverages our management team s experience investing within the energy industry. Potential upside from growth in the target business and an improved capital structure will be weighed against any identified downside risks. These criteria are not intended to be exhaustive. Any evaluation relating to the merits of a particular initial business combination may be based, to the extent relevant, on these general guidelines as well as other considerations, factors and criteria that our management may deem relevant. In the event that we decide to enter into our initial business combination with a target business that does not meet the above criteria and guidelines, we will disclose that the target business does not meet the above criteria in our shareholder communications related to our initial business combination, which, as discussed in this prospectus, would be in the form of proxy solicitation or tender offer materials that we would file with the SEC. Initial Business Combination We are not presently engaged in, and we will not engage in, any substantive commercial business for an indefinite period of time following this offering. We intend to utilize cash derived from the proceeds of this offering and the private placement units, as well as our equity, debt or a combination of these, in effecting a business combination which has not yet been identified. Accordingly, investors in this offering are investing without first having an opportunity to evaluate the specific merits or risks of any one or more business combinations. A business combination may involve the acquisition of, or merger with, a company which does not need substantial additional capital but which desires to establish a public trading market for its shares, while avoiding what it may deem to be adverse consequences of undertaking a public offering itself. These include time delays, significant expense, loss of voting control and compliance with various federal and state securities laws. In the alternative, we may seek to consummate a business combination with a company that may be financially unstable or in its early stages of development or growth. While we may seek to effect simultaneous business combinations with more than one target business, we will probably have the ability, as a result of our limited resources, to effect only a single business combination. We will either (1) seek shareholder approval of our initial business combination at a meeting called for such purpose at which shareholders may seek to redeem all or a portion of their public shares, regardless of whether they abstain, vote for or against or vote at all with respect to the proposed business combination, or (2) provide our shareholders with the opportunity to sell their shares to us by means of a tender offer without a shareholder vote, in each case for an amount equal to their pro rata share of the aggregate amount then on deposit in the trust account (net of permitted withdrawals), subject to the limitations described herein. The decision as to whether we will seek shareholder approval of our proposed business combination or allow shareholders to sell their shares to us in a tender offer will be made by us, solely in our discretion, and will be based on a variety of factors such as the timing of the transaction and whether the terms of the transaction would otherwise require us to seek shareholder approval. Unlike other blank 6 Table of Contents check companies which require shareholder votes and conduct proxy solicitations in conjunction with their initial business combinations and related redemptions of public shares for cash upon consummation of such initial business combinations even when a vote is not required by law, we will have the flexibility to avoid such shareholder vote and allow our shareholders to sell their shares pursuant to the tender offer rules of the SEC. In that case, we will file tender offer documents with the SEC, which will contain substantially the same financial and other information about the initial business combination as is required under the SEC s proxy rules. If we seek shareholder approval of our initial business combination, we will consummate our initial business combination only if we obtain the approval of an ordinary resolution under Cayman Islands law, which requires the affirmative vote of at least a simple majority of the votes cast by such shareholders, voting together as a single class, who, being present and entitled to vote, attend and vote at a general meeting of the company held for the purposes of approving the business combination, or as a special resolution under Cayman Islands law, which requires the affirmative vote of at least two-thirds (2/3) of the votes cast by such shareholders, voting together as a single class, who, being present and entitled to vote, attend and vote at a general meeting of the company and by way of a unanimous written resolutions, and held for the purposes of approving the business combination, to the extent that such business combination is structured as a statutory merger or consolidation with another company under Cayman Islands law. We will have until 24 months from the closing of this offering to consummate an initial business combination. If we are unable to consummate an initial business combination within such time period, we will, as promptly as reasonably possible but not more than 10 business days thereafter, redeem 100% of the outstanding public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including any interest earned on the funds held in the trust account, net of permitted withdrawals, and up to $100,000 of interest to pay dissolution expenses, divided by the number of then issued and outstanding public shares, which redemption will completely extinguish the public shareholders rights as shareholders (including the right to receive further liquidation distributions, if any), subject to applicable law and as further described herein, and then seek to liquidate and dissolve. We expect the pro rata redemption price to be approximately $10.00 per Class A ordinary share (regardless of whether or not the underwriters exercise their over-allotment option), without taking into account any interest earned on such funds. However, we cannot assure you that we will in fact be able to distribute such amounts as a result of claims of creditors, which may take priority over the claims of our public shareholders. If we do not complete our initial business combination within the completion window, while we do not currently intend to seek shareholder approval to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to consummate an initial business combination, we may elect to do so in the future. There is no limit on the number of extensions that we may seek; however, we do not expect that it will be necessary to extend the time period to consummate our initial business combination beyond 36 months from the closing of this offering. If we determine not to or are unable to extend the time period to consummate our initial business combination or fail to obtain shareholder approval to extend the completion window, our Sponsor s investment in our founder shares and our private placement units may be worthless. Our initial business combination must occur with one or more target businesses that together have a fair market value of at least 80% of the assets held in the trust account (excluding any deferred underwriting commissions and taxes payable on interest earned) at the time of the agreement to enter into the initial business combination. The fair market value of the target or targets will be determined by our Board of Directors based upon one or more standards generally accepted by the financial community (such as actual and potential sales, earnings, cash flow and/or book value). Even though our Board of Directors will rely on generally accepted standards, our Board of Directors will have discretion to select the standards employed. In addition, the application of the standards generally involves a substantial degree of judgment. Accordingly, investors will be relying on the business judgment of the Board of Directors in evaluating the fair market value of the target or targets. The proxy solicitation materials or tender offer documents used by us in connection with any proposed transaction will provide public shareholders with our analysis of the fair market value of the target business, as well as the basis for our determinations. If our Board of Directors is not able independently to determine the fair market value of the target business or businesses, we may, in our sole discretion, obtain an opinion from an independent investment banking firm, or another independent entity that commonly renders valuation opinions on the type of target business we are seeking to acquire, with respect to the satisfaction of such criteria. However, unless we consummate our initial business combination with an affiliated entity, our Board of Directors is not required to obtain an opinion from an independent investment banking firm or another independent entity that the price we are paying is fair to our shareholders from a financial point of view. 7 Table of Contents As described below adjacent to the caption The Offering Offering proceeds to be held in the trust account, the Nasdaq rules provide that at least 90% of the gross proceeds from this offering and the sale of the units be deposited in a trust account. Of the $232,550,000 gross proceeds we will receive from this offering and the sale of the private placement units (or $266,637,500 if the underwriters over-allotment option is exercised in full), an aggregate of $225,000,000 (or $10.00 per unit), or $258,750,000 (or $10.00 per unit) if the underwriters over-allotment option is exercised in full, will be placed in a segregated trust account located in the United States maintained by Odyssey Transfer and Trust Company acting as trustee pursuant to an agreement to be signed on the date of this prospectus. The funds in the trust account will be invested only in specified U.S. government treasury bills or in specified money market funds or in an interest-bearing demand deposit account. We currently anticipate structuring a business combination to acquire 100% of the equity interests or assets of the target business or businesses. We may, however, structure our initial business combination where we merge directly with the target business or where we acquire less than 100% of such interests or assets of the target business in order to meet certain objectives of the target management team or shareholders or for other reasons, but we will only complete such business combination if the post-transaction company owns or acquires 50% or more of the outstanding voting securities of the target or otherwise acquires a controlling interest in the target sufficient for it not to be required to register as an investment company under the Investment Company Act of 1940, as amended (the Investment Company Act ). Even if the post-transaction company owns or acquires 50% or more of the voting securities of the target, our shareholders prior to the business combination may collectively own a minority interest in the post-transaction company, depending on valuations ascribed to the target and us in the business combination transaction. For example, we could pursue a transaction in which we issue a substantial number of new shares in exchange for all of the outstanding a target. In this case, we could acquire a 100% controlling interest in the target; however, as a result of the issuance of a substantial number of new shares, our shareholders immediately prior to our initial business combination could own less than a majority of our outstanding shares subsequent to our initial business combination. If less than 100% of the equity interests or assets of a target business or businesses are owned or acquired by the post-transaction company, the portion of such business or businesses that is owned or acquired is what will be valued for purposes of the 80% fair market value test, as described above. As more fully discussed in Management Conflicts of Interest, if any of our officers or directors becomes aware of a business combination opportunity that falls within the line of business of any entity to which he or she has fiduciary or contractual obligations, he or she may be required to present such business combination opportunity to such entity prior to presenting such business combination opportunity to us. Certain of our directors currently have, and any of our officers or directors may in the future have, certain relevant fiduciary duties or contractual obligations. In addition, our Sponsor, officers and directors may participate in the formation of, or become an officer or director of, any other blank check company prior to completion of our initial business combination. As a result, our Sponsor, officers or directors could have conflicts of interest in determining whether to present business combination opportunities to us or to any other blank check company with which they may become involved. In such event, such companies may present additional conflicts of interest in pursuing an acquisition target. However, we do not believe that any potential conflicts would materially affect our ability to complete our initial business combination. Sponsor Information Our Sponsor is a Delaware limited liability company, which was formed to invest in our company. Although our Sponsor is permitted to undertake any activities permitted under the Delaware Limited Liability Company Act and other applicable law, our Sponsor s business is focused on investing in our company. Charles Leykum, our Chairman and Chief Executive Officer, is the sole managing member of Talon Capital Holdings LLC, which is the sole managing member of our Sponsor, and holds voting and investment discretion with respect to the securities held of record by the Sponsor. Mr. Leykum indirectly owns approximately 76.7% of the membership interests in our Sponsor, which includes an indirect interest in approximately 75.3% of the founder shares and 100% of the private placement units, in each case assuming exercise of the underwriters overallotment option in full. Other than Mr. Leykum, no other person has a direct or indirect material interest in our Sponsor. Our Sponsor transferred 20,000 founder shares to each of our independent directors at a purchase price of approximately $0.003 per share. Certain passive, non-managing entities will hold membership interests in our Sponsor. None of the non-managing members of our Sponsor will have any rights to control our Sponsor or to vote or dispose of any securities held by our Sponsor. Other than our management team, none of the other members of our Sponsor will participate in our company s activities. 8 Table of Contents The following table sets forth the payments to be received by our Sponsor and its affiliates from us prior to or in connection with the completion of our initial business combination and the securities issued and to be issued by us to our Sponsor or its affiliates: Entity/Individual Amount of Compensation to be Received or Securities Issued or to be Issued Consideration Paid or to be Paid Talon Capital Sponsor LLC 8,625,000 Class B ordinary shares (of which an aggregate of 40,000 Class B ordinary shares was transferred to our independent directors)(1) $25,000 530,000 private placement units to be purchased simultaneously with the closing of this offering $5,300,000 Up to $250,000 Repayment of loans made to us to cover offering related and organizational expenses $40,000 per month Office space located at 440 Louisiana Street, Suite 1050, Houston, Texas 77002, administrative and shared personnel support services Up to $1,500,000 in working capital loans, which loans may be convertible into private placement units at the business combination at a price of $10.00 per unit Working capital loans to finance transaction costs in connection with an initial business combination Reimbursement for any out-of-pocket expenses related to identifying, investigating and completing an initial business combination Services in connection with identifying, investigating and completing an initial business combination Holders of Class B ordinary shares Anti-dilution protection upon conversion into Class A ordinary shares at a greater than one-to-one ratio Issuance of the Class A ordinary shares issuable in connection with the conversion of the founder shares on a greater than one-to-one basis upon conversion ____________ (1) The number of Class B ordinary shares, and the forfeiture mechanism underlying the Class B ordinary shares, has been determined in order to ensure that the Class B ordinary shares will represent 25% of the outstanding ordinary shares (including any shares underlying the private placement units) upon completion of this offering and the exercise of the underwriters over-allotment option, if any. If we increase or decrease the size of this offering pursuant to Rule 462(b) under the Securities Act, we will effect a share dividend or a share contribution back to capital, as applicable, immediately prior to the consummation of the offering, in such amount as to maintain the collective ownership of the initial shareholders, prior to this offering at approximately 25% of our issued and outstanding ordinary shares (including any shares underlying the private placement units) upon the consummation of this offering. The Class B ordinary shares will automatically convert into Class A ordinary shares at the time of our initial business combination, or earlier at the option of the holder, on a one-for-one basis, subject to the adjustment as provided herein. In the case that additional Class A ordinary shares, or equity-linked securities (as described herein), are issued or deemed issued in excess of the amounts issued in this offering and related to the closing of our initial business combination, the ratio at which the Class B ordinary shares will convert into Class A ordinary shares will be adjusted (unless the holders of a majority of the issued and outstanding Class B ordinary shares agree to waive such anti-dilution adjustment with respect to any such issuance or deemed issuance) so that the number of Class A ordinary shares issuable upon conversion of all Class B ordinary shares will equal, in the aggregate, on an as-converted basis, 25% of the sum of (i) the aggregate of our issued and outstanding founder shares, private placement shares and public shares after this offering and the private placement, plus (ii) all Class A ordinary shares and equity-linked securities issued or deemed issued, in connection with the closing of the initial business combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in the initial business combination and any private placement-equivalent units issued to our Sponsor or any of its affiliates or to our officers or directors 9 Table of Contents ____________ upon conversion of working capital loans) minus (iii) any redemptions of Class A ordinary shares by public shareholders in connection with an initial business combination; provided that such conversion of founder shares will never occur on a less than one-for-one basis. The anti-dilution provisions in our Class B ordinary shares may result in the issuance of additional shares to the holders of Class B ordinary shares and material dilution to the public shareholders equity interests. Because our Sponsor acquired the founder shares at a nominal price, our public shareholders will incur immediate and substantial dilution upon the closing of this offering, assuming no value is ascribed to the warrants included in the units. As a result, the holders of our founder shares (including certain of our directors and officers that indirectly own founder shares) could make a substantial profit after our initial business combination even if our public shareholders lose money on their investment as a result of a decrease in the post-combination value of their Class A ordinary shares. Further, the Class A ordinary shares issuable in connection with the conversion of the founder shares may result in material dilution to our public shareholders due to the anti-dilution rights of our founder shares that may result in an issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion. See the sections titled Risk Factors Risks Relating to our Management Team The nominal purchase price paid by our Sponsor for the founder shares may result in significant dilution to the implied value of your public shares upon the consummation of our initial business combination, and our Sponsor is likely to make a substantial profit on its investment in us in the event we consummate an initial business combination, even if the business combination causes the trading price of our ordinary shares to materially decline and Dilution. Public shareholders will also experience additional dilution from the issuance of the shares (the private shares ) underlying the private placement units (including private shares underlying private placement units issued upon conversion of working capital loans). Additional shares may be issued upon exercise of any private warrants underlying private placement units issued upon conversion of working capital loans. The exercise of the warrants would cause the actual dilution to the public shareholders to be higher, particularly where a cashless exercise is utilized. The founder shares will automatically convert into Class A ordinary shares in connection with the consummation of our initial business combination or earlier at the option of the holder on a one-for-one basis, subject to adjustment for share sub-divisions, share capitalizations, reorganizations, recapitalizations and the like, and subject to further adjustment as provided herein. The Class A ordinary shares issuable in connection with the conversion of the founder shares may result in material dilution to our public shareholders due to the anti-dilution rights of our founder shares that may result in an issuance of Class A ordinary shares on a greater than one-to-one basis upon conversion. In the case that additional Class A ordinary shares, or any other equity-linked securities, are issued or deemed issued in excess of the amounts sold in this offering and related to or in connection with the closing of the initial business combination, the ratio at which Class B ordinary shares convert into Class A ordinary shares will be adjusted (unless the holders of a majority of the outstanding Class B ordinary shares agree to waive such adjustment with respect to any such issuance or deemed issuance) so that the number of Class A ordinary shares issuable upon conversion of all Class B ordinary shares will equal, in the aggregate, 25% of the sum of (i) the aggregate of our issued and outstanding founder shares, private placement shares and public shares after this offering and the private placement, plus (ii) all Class A ordinary shares and equity-linked securities issued or deemed issued, in connection with the closing of the initial business combination (excluding any shares or equity-linked securities issued, or to be issued, to any seller in the initial business combination and any private placement-equivalent units issued to our Sponsor or any of its affiliates or to our officers or directors upon conversion of working capital loans) minus (iii) any redemptions of Class A ordinary shares by public shareholders in connection with an initial business combination; provided that such conversion of founder shares will never occur on a less than one-for-one basis. 10 Table of Contents Pursuant to a letter agreement to be entered with us, each of our Sponsor, directors and officers has agreed to restrictions on its ability to transfer, assign, or sell the founder shares and placement units, as summarized in the table below: Subject Securities Expiration Date Natural Persons and Entities Subject to Restrictions Exceptions to Transfer Restrictions Founder Shares The earlier of (A) six months after the completion of our initial business combination; and (B) subsequent to our initial business combination (x) if the last reported sale price of our Class A ordinary shares equals or exceeds $11.50 per share (as adjusted for share sub-divisions, share dividends, rights issuances, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing after our initial business combination or (y) the date on which we complete a liquidation, merger, share exchange, reorganization or other similar transaction that results in all of our public shareholders having the right to exchange their ordinary shares for cash, securities or other property. Talon Capital Sponsor LLC Charles Leykum Gerald Cimador Shawn Reynolds Thomas Simons Transfers permitted (a) to (1) the Sponsor s members, (2) the directors or officers of us, the Sponsor, or the Sponsor s members, (3) any affiliates or family members of the directors or officers of us, the Sponsor, or the Sponsor s members, (4) any members or partners of the Sponsor, the Sponsor s members, or their respective affiliates, or any affiliates of the Sponsor, the Sponsor s members, or any employees of such affiliates; (b) in the case of an individual, as a gift to such person s immediate family or to a trust, the beneficiary of which is a member of such person s immediate family, an affiliate of such person or to a charitable organization; (c) in the case of an individual, by virtue of laws of descent and distribution upon death of such person; (d) in the case of an individual, pursuant to a qualified domestic relations order; (e) in the case of a trust by distribution to one or more permissible beneficiaries of such trust; (f) by private sales or transfers made in connection with any forward purchase agreement or similar arrangement, in connection with an extension of the completion window or in connection with the consummation of a business combination at prices no greater than the price at which the securities were originally purchased; (g) to us for no value for cancellation in connection with the consummation of the initial business combination; (h) in the event of our liquidation prior to our consummation of 11 Table of Contents Subject Securities Expiration Date Natural Persons and Entities Subject to Restrictions Exceptions to Transfer Restrictions our initial business combination; (i) by virtue of the laws of the State of Delaware, the Sponsor s limited liability company agreement, or upon dissolution of such Sponsor; and (j) in the event that, subsequent to our consummation of an initial business combination, we complete a liquidation, merger, share exchange or other similar transaction which results in all of our shareholders having the right to exchange their Class A ordinary shares for cash, securities or other property; provided, however, that in the case of clauses (a) through (f) these permitted transferees must enter into a written agreement agreeing to be bound by these transfer restrictions and the other restrictions contained in the letter agreement. Private Placement Units and underlying securities 30 days after the completion of our initial business combination Talon Capital Sponsor LLC Same as above. Up to 1,125,000 of the founder shares will be surrendered for no consideration depending on the extent to which the underwriters over-allotment option is exercised. In addition, in order to facilitate our initial business combination or for any other reason determined by our Sponsor in its sole discretion, our Sponsor may surrender or forfeit, transfer or exchange our founder shares, private placement units or any of our other securities, including for no consideration, as well as subject any such securities to earn-outs or other restrictions, or otherwise amend the terms of any such securities or enter into any other arrangements with respect to any such securities. We may also issue Class A ordinary shares upon conversion of the Class B ordinary shares at a ratio greater than one-to-one at the time of our initial business combination as a result of the anti-dilution provisions as set forth therein. Our Management Team We believe that our management team is well positioned to identify attractive risk-adjusted returns in the marketplace and that our deal sourcing channels, ranging from industry executives, private owners, private equity funds, and investment bankers, along with the expertise gained through involvement with CSL platform, will enable us to pursue a broad range of opportunities. Additionally, our management believes that its ability to identify and implement value creation initiatives will remain central to its differentiated acquisition strategy. We intend to primarily focus our target sourcing efforts on private companies that we believe would benefit from a public listing and partnership with our team and that otherwise cannot gain access to public capital in this current market environment. We believe that our management team s background and prior successes could have a significant short- and long-term impact on target businesses and offer a compelling opportunity for targets seeking an alternative path to liquidity and value maximalization. Charles S. Leykum has served as Chairman of our board of directors and as our Chief Executive Officer since May 1, 2025. Mr. Leykum founded CSL, an energy services-focused private equity firm in 2008, specializing in energy services, power, and infrastructure companies. Prior to founding CSL, Mr. Leykum was a Portfolio Manager at Soros Fund Management LLC, where he oversaw investments in the energy sector. Before his time at 12 Table of Contents Soros, he worked in the Principal Investment Area and the Investment Banking Division of Goldman Sachs & Co. LLC. From January 2021 to the present, Mr. Leykum has served as Founder and Chairman of RNWBL, LLC, a leading independent provider of renewable services focusing on wind and solar power, and served on the board of directors of Ranger Energy Services, Inc. (NYSE: RNGR ) from August 2017 to November 2024. Mr. Leykum was also a co-founder and sponsor, and served as a director, of Sentinel from June 2017 to December 2023. Mr. Leykum graduated with a Bachelor of Arts in Economics from Columbia University and a Master of Business Administration from Harvard Business School. Gerald Cimador has served as our Chief Financial Officer since May 1, 2025. He currently serves as the Partner and Chief Financial Officer and Chief Compliance Officer of CSL. Since joining CSL in May 2008, he has overseen all administrative and operational functions, including accounting, reporting, tax, and compliance, and sits on the firm s investment committee. From 1999 to 2008 Mr. Cimador was Controller of Moore Capital Management LP, a private investment management firm, where he managed accounting and reporting for the investment manager and its subsidiaries. Prior to that, from 1997 to 1999, Mr. Cimador served as Audit Manager of Ernst & Young LLP. Mr. Cimador started his career as Audit Senior for Goldstein Golub Kessler & Co. from 1994 to 1997. Mr. Cimador served on the board of directors of Ranger Energy Services, Inc. (NYSE: RNGR ) from January 2018 to May 2023. In addition to his role at CSL, Mr. Cimador served as Chief Financial Officer and Chief Accounting Officer of Sentinel from June 2017 to December 2023. He has a BBA in Accounting from Hofstra University. In addition to Mr. Leykum, our Board of Directors will consist of Shawn Reynolds, Thomas Simons and another independent director to be appointed after the initial public offering. We believe our independent directors have highly relevant experiences and skill sets, including prior independent Board experience at United States listed companies, significant private and public equity, and capital markets experience, and international transaction and business development experience. Shawn Reynolds will serve on our board of directors upon the effectiveness of the registration statement of which this prospectus forms a part. Since 2010, Mr. Reynolds has been the head of public and private resource-related investment strategies for VanEck, a $130 billion AUM global asset manager, and currently serves as Portfolio Manager for VanEck s Global Resources Fund. Prior to joining VanEck in 2005, Mr. Reynolds was an investment banker and equity research analyst for Credit Suisse First Boston, Lehman Brothers, Goldman Sachs and Petrie Parkman in New York, Melbourne and London. He was an exploration geologist for Sohio in 1985 and Tenneco Oil from 1987 to 1989. Mr. Reynolds currently serves as a member of the Board of Directors of TAG Oil Ltd. and from 2017 to 2019 was the Vice Chairman of the Board of Kuwait Energy Company. Currently, Mr. Reynolds serves as chair of HMH Hospitals Corp., part of the largest health care network in New Jersey. From 2011 to 2015, Mr. Reynolds served as the President of the Board of Trustees at the Rumson Country Day School. Mr. Reynolds received a Master of Business Administration in Finance from Columbia Business School, a Master of Arts in Petroleum Geology from the University of Texas, Austin, and a Bachelor of Science in Engineering from Cornell University. Thomas Simons will serve on our board of directors upon the effectiveness of the registration statement of which this prospectus forms a part. Since November 2025, Mr. Simons has been a senior advisor to Uniquem Chemicals, a private Canadian supplier of oilfield upstream chemicals. From February 2024 to June 2024, Mr. Simons served as the CEO and President of Convrg Innovations Inc., an Arc Financial portfolio company. Since February 2025, Mr. Simons has been a director at Startec Compression, a company providing engineering and manufacturing services. Since November 2018, Mr. Simons has been a director at Accelerate Financial Technologies, a provider of Alternative ETF products on TMX. Mr. Simons is the founder of CES Energy Solutions, which completed its initial public offering on TMX in March 2006, and since then has played an instrumental role in the company s organic growth and vertical expansion. Mr. Simons graduated from Advanced Management Program at Harvard Business School. We believe that our management team s extensive relationships across the energy and power industries, comprehensive operating experience building leading companies, transaction experience in acquiring and integrating businesses and focus on partnering with management teams to share our industry knowledge and network of long-standing industry relationships will enable us to consummate an initial business combination and facilitate innovative operational improvements and potential additional acquisitions post-close. Our collective experience in addressing complex situations across consumer- and business-facing business models involving a variety of revenue models and constituents, including in the energy and power industries, and developing creative solutions forms the foundation of our competitive advantage. 13 Table of Contents With respect to the foregoing examples, the past performance of the members of our management team or their affiliates, including with respect to Sentinel, and their engagement in the energy and power industries, is not a guarantee that we will be able to identify a suitable candidate for our initial business combination or of success with respect to any business combination we may consummate. Charles Leykum served as a director, and Gerald Cimador served as the Chief Financial Officer and Chief Accounting Officer of Sentinel, a former blank check company that raised $345 million in its initial public offering in November 2017. In October 2018, Sentinel announced a planned business combination with Strike Capital LLC, backed by $150 million in PIPE commitments. However, the deal was terminated in February 2019. In November 2019, Sentinel announced the liquidation of the trust account and proceeded to redeem all 34,500,000 of its outstanding public Class A ordinary shares. Potential Additional Financing We may obtain additional financing to complete our initial business combination, for example, because the transaction requires more cash than is available from the proceeds held in our trust account or because we become obligated to redeem a significant number of our public shares upon completion of the business combination, in which case we may issue additional securities or incur debt in connection with such business combination. If we raise additional funds through equity and equity-linked securities or the incurrence of indebtedness, our public shareholders may suffer significant dilution and these securities could have rights that rank senior to our public shares. If we raise additional funds through the incurrence of indebtedness, such indebtedness would have rights that are senior to our equity securities and could contain covenants that restrict our operations. Further, as described above, due to the anti-dilution rights of our founder shares, our public shareholders may incur material dilution. In addition, we may target businesses with enterprise values that are greater than we could acquire with the net proceeds of this offering and the sale of the private placement units, and, as a result, if the cash portion of the purchase price exceeds the amount available from the trust account, net of amounts needed to satisfy any redemptions by public shareholders, we may be required to seek additional financing to complete such proposed initial business combination. We may also obtain financing prior to the closing of our initial business combination to fund our working capital needs and transaction costs in connection with our search for and completion of our initial business combination. There is no limitation on our ability to raise funds through the issuance of equity or equity-linked securities or through loans, advances or other indebtedness in connection with our initial business combination, including pursuant to forward purchase agreements or backstop agreements we may enter into following consummation of this offering. Subject to compliance with applicable securities laws, we would only complete such financing simultaneously with the completion of our initial business combination. If we are unable to complete our initial business combination because we do not have sufficient funds available to us, we will be forced to liquidate the trust account. In addition, following our initial business combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations. Corporate Information We are an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended (the Securities Act ), as modified by the Jumpstart Our Business Startups Act of 2012 (the JOBS Act ). As such, we are eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the prices of our securities may be more volatile. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We intend to take advantage of the benefits of this extended transition period. 14 Table of Contents We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of this offering, (b) in which we have total annual gross revenue of at least $1.235 billion, or (c) in which we are deemed to be a large accelerated filer, which means the market value of our Class A ordinary shares that is held by non-affiliates exceeds $700 million as of the prior June 30, and (2) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. References herein to emerging growth company will have the meaning associated with it in the JOBS Act. Additionally, we are a smaller reporting company as defined in Item 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of our ordinary shares held by non-affiliates exceeds $250 million as of the prior June 30, and (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of our ordinary shares held by non-affiliates exceeds $700 million as of the prior June 30. Prior to the date of this prospectus, we will file a Registration Statement on Form 8-A with the SEC to voluntarily register our securities under Section 12 of the Securities Exchange Act of 1934, as amended, or the Exchange Act. As a result, we will be subject to the rules and regulations promulgated under the Exchange Act. We have no current intention of filing a Form 15 to suspend our reporting or other obligations under the Exchange Act prior or subsequent to the consummation of our initial business combination. Our executive offices are located at 440 Louisiana Street, Suite 1050, Houston, TX 77002, and our telephone number is (281) 407-0686. 15 Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2025/TNONW_tenon_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/TNONW_tenon_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/TNONW_tenon_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/TOPP_toppoint_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/TOPP_toppoint_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/TOPP_toppoint_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/TRNR_interactiv_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/TRNR_interactiv_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..8f2cca60fc749133e54c789f5cafeaa48c6e6b95
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/TRNR_interactiv_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary highlights selected information appearing elsewhere in this prospectus. While this summary highlights what we consider to be important information about us, you should carefully read this entire prospectus and the documents incorporated by reference in this prospectus before investing in our Common Stock, especially the risks and other information we discuss under the heading Risk Factors and our consolidated financial statements and related notes incorporated by reference herein. If any of the risks described herein materialize, our business, financial condition, operating results and prospects could be materially and adversely affected. In that event, the price of the Common Stock could decline, and you could lose part or all of your investment. Our expectations for our future performance may change after the date of this prospectus and there is no guarantee that such expectations will prove to be accurate.. Unless otherwise indicated or the context requires otherwise, the words we, us, our , the Company, our Company, CLMBR and FORME, refer to Interactive Strength Inc., a Delaware corporation, and unless the context indicates otherwise, also includes our wholly-owned subsidiaries. Overview Our Purpose We are an innovative specialty fitness equipment company that leverages technology and content to deliver highly engaging and versatile workout experiences. With CLMBR, we provide an unmatched cardio workout that delivers an effective low-impact, full-body workout. With FORME, we make strength training and personal coaching accessible to anyone, anywhere, at any time. We are driven to provide the best in both cardio and strength training. Our products combine industry-leading engineering and design with world-class technology and content. Our company has one reportable segment, the development and sale of its fitness equipment and technology platform. Who We Are Interactive Strength Inc. is the parent company of two leading brands serving the commercial and at-home markets with specialty fitness equipment and virtual training: CLMBR and FORME. CLMBR manufactures vertical climbing equipment and provides a unique digital and on-demand training platform. FORME is a hardware manufacturer and digital fitness service provider that combines award-winning smart gyms with live 1:1 personal training (from real humans) to deliver an immersive experience. The combination of technology with expert training leads to better outcomes for both consumers and trainers alike. CLMBR and FORME offer fitness solutions for both the commercial and at-home markets. Through the CLMBR brand, we offer a vertical climbing machine that delivers a proven full-body cardio and strength workout, but with a design and content platform that makes the workout mass appealing and accessible to all fitness levels. A workout that has long been exclusive to celebrities and professional athletes with personal trainers can now be accessed by anyone. The patented open central design and content platform provides a vertical climbing experience that is unlike any other. CLMBR offers two display options: a 21 touch screen and a 10 touch screen making it suitable for any commercial fitness application, both self-directed to instructor-directed environments, from large health clubs to boutique training studios. With its low impact and ergonomic movement, CLMBR is safe and accessible for most ages and levels of ability and can be found at gyms and fitness studios, hotels, and physical therapy facilities, and residential homes. CLMBR MSRP is $3,995 or less, depending on display option and order quantity. TABLE OF CONTENTS Page SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS 1 PROSPECTUS SUMMARY 3
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diff --git a/parsed_sections/prospectus_summary/2025/UCO_proshares_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/UCO_proshares_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..f96db9de70d6f023785fc779c400d6a42620b34a
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/UCO_proshares_prospectus_summary.txt
@@ -0,0 +1 @@
+Investors should read the following summary together with the more detailed information in this Prospectus before investing in Shares of any Fund, including the information under the caption Risk Factors, and all exhibits to this Prospectus and the information incorporated by reference in this Prospectus, including the financial statements and the notes to those financial statements in the Trust s Annual Report on Form 10-K, and the Quarterly Reports on Form 10-Q, and Current Reports, if any, on Form 8-K. Please see the section entitled Incorporation by Reference of Certain Documents in Part Two of this Prospectus. Investors should also read any updated Prospectus, supplements to this Prospectus, notices and press releases, and other important information about the Fund which are posted on the Sponsor s website at www.ProShares.com. For ease of reference, any references throughout this Prospectus to various actions taken by a Fund are actually actions taken by the Trust on behalf of the Fund. The definitions of capitalized terms used in this Prospectus can be found in the Glossary of Defined Terms in Appendix A and throughout this Prospectus.
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/VIA_via_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/VIA_via_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/VIA_via_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/VRMWW_vroom-inc_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/VRMWW_vroom-inc_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..655e0ff9cafb51f5e74959791e1005f93402815e
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/VRMWW_vroom-inc_prospectus_summary.txt
@@ -0,0 +1 @@
+prospectus summary, that represent challenges that we face in connection with the successful implementation of our strategy and the growth of our business. In particular, the following considerations, among others, may offset our competitive strengths or have a negative effect on our business strategy, which could cause a decline in the price of shares of our Common Stock or Warrants and result in a loss of all or a portion of your investment: Risks Related to our Emergence from Bankruptcy and Business We recently emerged from the Prepackaged Chapter 11 Case, which could adversely affect our business and relationships, and subject us to risks and uncertainties; Our emergence from the Prepackaged Chapter 11 Case and its impact has consumed and may continue to consume a substantial portion of time and attention of our management; There are risks associated with the discontinuance of our ecommerce operations and wind-down of our used vehicle dealership business; our Long-Term Strategic Plan may not be successful, and may not lead to growth and enhanced profitability for our UACC or CarStory businesses; we may not generate sufficient liquidity to operate our business; general business and economic conditions and risks related to the larger automotive ecosystem, including consumer demand; we have a history of losses and we may not achieve or maintain profitability in the future; our indebtedness and liabilities could limit the cash flow available for our operations, expose us to risks that could adversely affect our business, financial condition and results of operations and impair our ability to satisfy our debt obligations; the geographic concentration of UACC s borrowers or dealerships creates an exposure to local and regional downturns or severe weather or catastrophic occurrences that may materially and adversely affect our business, financial condition and results of operations; we may be unable to satisfy a Nasdaq listing rule or that of another national securities exchange; UACC may be unable to continue to access or renew funding sources and obtain capital needed to maintain and grow its business; UACC may be unable to sell automotive finance receivables and generate gains on sales of those finances receivables, which could harm our business, results of operations, and financial condition; UACC is currently experiencing increasing credit losses in interests it holds in automotive finance receivables and its credit scoring systems may not effectively forecast its automotive receivables loss rates. Higher than anticipated credit losses or prepayments or the inability to effectively forecast loss rates may negatively impact our operating results; 9 Table of Contents if UACC loses servicing rights on its automobile contracts, our results of operations would be negatively impacted; if we or our third-party providers sustain cyber-attacks or other privacy or data security incidents that result in security breaches, we could suffer a loss of sales and increased costs, exposure to significant liability, reputational harm and other negative consequences; we operate in a highly regulated industry and are subject to a wide range of federal, state and local laws and regulations and failure to comply with these laws and regulations could have a material adverse effect on our business, financial condition and results of operations; we are, and may in the future be, subject to legal proceedings in the ordinary course of our business. If the outcomes of these proceedings are adverse to us, it could have a material adverse effect on our business, financial condition and results of operations; and our actual operating results may differ significantly from our guidance. Risks Related to the Common Stock following our emergence from the Prepackaged Chapter 11 Case, a former holder of our previously issued notes has the ability to significantly influence all matters submitted to stockholders of the reorganized company for approval; our common stock price may be volatile and the value of our common stock has declined since our initial public offering and may continue to decline regardless of our operating performance, and you may not be able to resell your shares at or above the price which you paid for them; we do not intend to pay dividends on our common stock for the foreseeable future; and we may be unable to satisfy a Nasdaq listing rule or that of another national securities exchange. Corporate Information The Company was incorporated in Delaware on January 31, 2012 under the name BCM Partners III, Corp. On June 25, 2013, the Company changed its name to Auto America, Inc. and on July 9, 2015, the Company changed its name to Vroom, Inc. In January 2021, the Company completed the acquisition of Vast Holdings, Inc. (d/b/a CarStory). On February 1, 2022 (the Acquisition Date ), the Company completed the acquisition of Unitas Holdings Corp. (now known as Vroom Finance Corporation), including its wholly owned subsidiaries United PanAm Financial Corp. (now known as Vroom Automotive Financial Corporation) and United Auto Credit Corporation ( UACC ). Our principal executive office is located at 4700 Mercantile Drive, Fort Worth, TX 76137. Our telephone number is (518)535-9125. Our website address is www.vroom.com. Information contained on our website is not a part of this prospectus, and the inclusion of our website address in this prospectus is an inactive textual reference only. This prospectus contains references to trademarks and service marks belonging to other entities. Solely for convenience, trademarks and trade names referred to in this prospectus may appear without the or TM symbols, but such references are not intended to indicate, in any way, that the applicable licensor will not assert, to the fullest extent under applicable law, its rights to these trademarks and trade names. We do not intend our use or display of other companies trade names, trademarks, or service marks to imply a relationship with, or endorsement or sponsorship of it by, any other companies. Implications of Being a Smaller Reporting Company We are a smaller reporting company as defined in the Exchange Act. We may take advantage of certain of the scaled disclosures available to smaller reporting companies until the fiscal year following the determination that our voting and non-voting common stock held by non-affiliates is $250 million or more measured on the last business day of our second fiscal quarter, or our annual revenues are less than $100 million during the most recently completed fiscal year and our voting and non-voting common stock held by non-affiliates is $700 million or more measured on the last business day of our second fiscal quarter. 10 Table of Contents
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diff --git a/parsed_sections/prospectus_summary/2025/VSME_vs-media_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/VSME_vs-media_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..98891d586ebc6d68f1b78a507d603543b0cb6c99
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/VSME_vs-media_prospectus_summary.txt
@@ -0,0 +1,508 @@
+Prospectus Summary Implications of Being an Emerging Growth Company 
+and Prospectus Summary Implications of Being a Foreign Private Issuer. 
+
+ 
+
+This
+prospectus provides a general description of the securities being offered. You should carefully read this prospectus and the registration
+statement of which it forms a part before you invest in any of the Shares.
+
+ 
+
+Investing
+in our Shares involves risks. See Risk Factors beginning on page 23.
+
+ 
+
+We
+were incorporated in the British Virgin Islands on August 30, 2022, as a holding company of our business, which is primarily operated
+through our indirectly wholly-owned HK SAR subsidiaries, VS Media Limited ( VS Media HK and GRACE CREATION LIMITED
+( Grace Creation ), our indirect wholly-owned Taiwan subsidiary, VS MEDIA LIMITED ( VS Media TW )
+and our indirect wholly-owned Singapore subsidiary, VS MEDIA PTE LTD. ( VS Media SG ).
+
+ 
+
+VS
+MEDIA Holdings Limited is not a Chinese or HK SAR operating company but a British Virgin Islands ( BVI ) holding company
+with operations conducted by our subsidiaries in HK SAR, Singapore and Taiwan. You are investing in Class A Ordinary Shares
+of VS MEDIA Holdings Limited, the BVI holding company.
+
+ 
+
+Neither
+we nor any of our subsidiaries is required to obtain permission from the government of the People s Republic of China, including
+the China Securities Regulatory Commission, or CSRC, to list our shares on the Nasdaq Capital Market. 
+
+ 
+
+ i
+
+ 
+
+ 
+
+ 
+
+On
+February 17, 2023, the CSRC released a set of new regulations which consists of the Trial Administrative Measures of Overseas Securities
+Offering and Listing by Domestic Companies, or the Trial Measures, and five supporting guidelines. The Trial Measures came into effect
+on March 31, 2023. The Trial Measures refine the regulatory system by subjecting both direct and indirect overseas offering and listing
+activities to the CSRC filing-based administration. Requirements for filing entities, time points and procedures are specified. A PRC
+domestic company that seeks to offer and list securities in overseas markets shall fulfill the filing procedure with the CSRC per the
+requirements of the Trial Measures. Where a PRC domestic company seeks to indirectly offer and list securities in overseas markets, the
+issuer shall designate a major domestic operating entity, which shall, as the domestic responsible entity, file with the CSRC. The Trial
+Measures also lay out requirements for the reporting of material events. Breaches of the Trial Measures, such as offering and listing
+securities overseas without fulfilling the filing procedures, shall bear legal liabilities, including a fine between RMB 1.0 million
+(approximately $150,000) and RMB 10.0 million (approximately $1.5 million), and the Trial Measures heighten the cost for offenders by
+enforcing accountability with administrative penalties and incorporating the compliance status of relevant market participants into the
+Securities Market Integrity Archives.
+
+ 
+
+The
+Trial Measures do not apply to us because we are not a PRC domestic company under the Trial Measures. Further, according to our Hong
+Kong counsel, Loeb & Loeb LLP, the national laws adopted by the PRC are generally not applicable to Hong Kong according to the Basic
+Law of the Hong Kong Special Administrative Region (the Basic Law ). The Basic Law came into effect on July 1, 1997. It
+is the constitutional document of Hong Kong, which sets out the PRC s basic policies regarding Hong Kong. The principle of one
+country, two systems is a prominent feature of the Basic Law, which dictates that Hong Kong will retain its unique common law
+and capitalist system for 50 years after the handover in 1997. Under the principle of one country, two systems, Hong Kong s
+legal system, which is different from that of the PRC, is based on common law supplemented by statutes.
+
+ 
+
+According
+to Article 18 of the Basic Law, national laws adopted by the PRC shall not be applied in Hong Kong, except for those listed in Annex
+III to the Basic Law, such as the laws in relation to the national flag, national anthem, and diplomatic privileges and immunities. Further,
+there is no legislation stating that the laws in Hong Kong should be commensurate with those in the PRC. Despite the foregoing, the legal
+and operational risks of operating in China also apply to businesses operating in Hong Kong and Macau.
+
+ 
+
+Recently,
+the General Office of the Central Committee of the Communist Party of China and the General Office of the State Council jointly issued
+the Opinions on Severe and Lawful Crackdown on Illegal Securities Activities, which was available to the public on July 6, 2021. These
+opinions emphasized the need to strengthen the administration over illegal securities activities and the supervision on overseas listings
+by China-based companies. The PRC government also initiated a series of regulatory actions and statements to regulate business operations
+in China with little advance notice, including cracking down on illegal activities in the securities market, enhancing supervision over
+China-based companies listed overseas, adopting new measures to extend the scope of cybersecurity reviews, and expanding the efforts
+in anti-monopoly enforcement. Since these statements and regulatory actions are relatively new, it is highly uncertain how soon
+legislative or administrative regulation making bodies will respond and what existing or new laws or regulations or detailed implementations
+and interpretations will be modified or promulgated, if any, and the potential impact such modified or new laws and regulations will
+have on our daily business operation, the ability to accept foreign investments and list on a U.S. exchange.
+
+ 
+
+The
+PRC Criminal Law, as newly amended on December 29, 2023, prohibits institutions, companies, and their employees from illegally selling
+or otherwise disclosing a citizen s personal information obtained during the course of performing duties or providing services
+or obtaining such information through theft or other illegal ways. On November 7, 2016, the Standing Committee of the PRC National People s
+Congress issued the Cyber Security Law of the PRC, or Cyber Security Law, which became effective on June 1, 2017.
+
+ 
+
+Pursuant
+to the Cyber Security Law, network operators must not, without users consent, collect their personal information, and may only
+collect users personal information necessary to provide their services. Providers are also obliged to provide security maintenance
+for their products and services and shall comply with provisions regarding the protection of personal information as stipulated under
+the relevant laws and regulations. The legal consequences of violation of the Cyber Security Law include penalties of warning, confiscation
+of illegal income, suspension of related business, winding up for rectification, shutting down the websites, and revocation of business
+license or relevant permits.
+
+ 
+
+ ii
+
+ 
+
+ 
+
+ 
+
+The
+Civil Code of the PRC (issued by the PRC National People s Congress on May 28, 2020 and effective from January 1, 2021) provides
+the main legal basis for privacy and personal information infringement claims under the Chinese civil laws. PRC regulators, including
+the Cyberspace Administration of China, or the CAC, MIIT, and the Ministry of Public Security have been increasingly focused on regulation
+in the areas of data security and data protection.
+
+ 
+
+The
+PRC regulatory requirements regarding cybersecurity are constantly evolving. For instance, various regulatory bodies in China, including
+the CAC, the Ministry of Public Security and the SAMR, have enforced data privacy and protection laws and regulations with evolving standards
+and interpretations. On December 28, 2021, the Chinese government promulgated Cybersecurity Review Measures, which came into effect on
+February 15, 2022. According to the Cybersecurity Review Measures, (i) the use of network products and services purchased by operators
+of critical information infrastructure, that affect or may affect national security, is subject to the cybersecurity review; (ii) an
+application for cybersecurity review should be made by the internet platform operator holding personal information of more than one million
+users before such internet platform operator lists its securities overseas; and (iii) relevant authorities of the cybersecurity review
+mechanism may initiate cybersecurity review if they determine an operator s network products or services or data processing activities
+affect or may affect national security.
+
+ 
+
+On
+September 30, 2024, the State Council released Regulations on the Management of Network Data Security, or the Network Data Regulation,
+which came into force on January 1, 2025. The Network Data Regulation is not only the first at the administrative regulation level specifically
+for network data security, but it also serves as a comprehensive implementing regulation for the compliance requirements set out by the
+Cybersecurity Law, Data Security Law, and Personal Information Protection Law. The Network Data Regulation introduces several key obligations,
+including requiring network data handlers to specify the purpose and method of personal information processing, as well as the types
+of personal information involved, before any personal information is handled. It also clarifies definitions for important data, outlines
+the obligations of those handling important data, establishes broader contractual requirements for data sharing between data handlers,
+and introduces a new exemption for regulatory obligations regarding cross-border. We do not know how such regulations will affect us
+and our continued listing on Nasdaq. In the event that the CAC determines that we are subject to these regulations, we may be subject
+to fines and penalties.
+
+ 
+
+On
+June 10, 2021, the Standing Committee of the PRC National People s Congress promulgated the PRC Data Security Law which came into
+effect on September 1, 2021. The Data Security Law also sets forth the data security protection obligations for entities and individuals
+handling personal data, including that no entity or individual may acquire such data by stealing or other illegal means, and that the
+collection and use of such data should not exceed the necessary limits. The costs of compliance with, and other burdens imposed by, Cyber
+Security Law and any other cybersecurity and related laws may limit the use and adoption of our products and services and could have
+an adverse impact on our business. Further, if the relevant laws mandate clearance of cybersecurity review and other specific actions
+to be completed by companies like us, we face uncertainties as to whether such clearance can be in a timely fashion or at all.
+
+ 
+
+We
+do not expect to be subject to the cybersecurity review by the CAC, given that: (i) we do not possess more than one million users 
+personal information; (ii) we do not place any reliance on collection and processing of any personal information to maintain our business
+operation; (iii) we have not been notified by any authorities of being classified as an operator of critical information infrastructure;
+(iv) data processed in our business should not have a bearing on national security nor affect or may affect national security; and (v)
+we have not been subject to any material administrative penalties, mandatory rectifications, or other sanctions by any competent regulatory
+authorities in relation to cybersecurity and data protection, nor have there been material cybersecurity and data protection incidents
+or infringement upon any third parties, or other legal proceedings, administrative or governmental proceedings pending or threatened
+against or relating to us.
+
+ 
+
+Further,
+as mentioned above, the national laws adopted by the PRC are generally not applicable to Hong Kong according to the Basic Law.
+
+ 
+
+However,
+there remains uncertainty as to how these measures and regulations will be interpreted or implemented and whether the PRC regulatory
+agencies, including the CAC, may adopt new laws, regulations, rules, or detailed implementation and interpretation related to the cybersecurity
+and data protection. If any such new laws, regulations, rules, or implementation and interpretation comes into effect, we will take all
+reasonable measures and actions to comply and minimize the adverse effect of such laws on us.
+
+ 
+
+ iii
+
+ 
+
+ 
+
+ 
+
+We
+cannot assure you that PRC regulatory agencies, including the CAC, would take the same view as we do, and there is no assurance that
+we can fully or timely comply with such laws. In the event that we are subject to any mandatory cybersecurity review and other specific
+actions required by the CAC, we face uncertainty as to whether any clearance or other required actions can be timely completed or at
+all. Given such uncertainty, we may be further required to suspend our relevant business, shut down our website, or face other penalties
+which could materially and adversely affect our business, financial condition, and results of operations.
+
+ 
+
+We
+believe that we have been in compliance with the data privacy and personal information requirements of the CAC for the abovementioned
+reasons. Neither the CAC nor any other PRC regulatory agency or administration has contacted the Company in connection with the Company s
+or its subsidiaries operations. The Company is currently not required to obtain regulatory approval from the CAC nor any other
+PRC authorities for its and its subsidiaries operations in HK SAR.
+
+ 
+
+As
+of the date of this prospectus, our Company and its subsidiaries have not received any inquiry, notice, warning or sanctions regarding
+our overseas listing from the China Securities Regulatory Commission or any other PRC governmental authorities. For more details, see
+ Risk Factors Risks Related to Doing Business in Hong Kong SAR We may be subject to a variety of laws and other
+obligations regarding cybersecurity and data protection, and any failure to comply with applicable laws and obligations could have a
+material and adverse effect on our business, financial condition and results of operations .
+
+ 
+
+None
+of our business activities appears to be within the immediate targeted areas of concern identified by the Chinese government. However,
+because some of our operating subsidiaries are in HK SAR and their operations are there, and given the Chinese government s significant
+oversight and discretion over the conduct of our business operations in HK SAR, the Chinese government may intervene or influence our
+operations at any time, which could result in a material change in our operations and consequently, the value of our Class A Ordinary
+Shares. The Chinese government could also significantly limit or completely hinder our ability to list on a U.S. or other foreign exchange
+and to offer future securities to investors and cause the value of such securities to significantly decline or be worthless. Please refer
+to Risk Factors Risks Related to Doing Business in Hong Kong SAR The recent spate of government interference
+by the PRC government into business activities of U.S. listed Chinese companies may negatively impact our operations, the value of our
+securities and/or significantly limit or completely hinder our ability to offer future securities to investors and cause the value of
+such securities to significantly decline or be worthless .
+
+ 
+
+Presently,
+none of the PRC laws and regulations above applies to us because national laws adopted by the PRC are not applicable in HK SAR, except
+for those listed in Annex III to the Basic Law. Further, there is no legislation stating that the laws in HK SAR should be commensurate
+with those in the PRC. With regard to the potential regulatory actions related to data security and anti-monopoly in HK SAR, please refer
+to our disclosures in Risk Factors Risks Related to Doing Business in Hong Kong SAR We may be subject to a
+variety of laws and other obligations regarding cybersecurity and data protection, and any failure to comply with applicable laws and
+obligations could have a material and adverse effect on our business, financial condition and results of operations on page
+38. Apart from the foregoing, there is no other impact on our ability to conduct our business as presently conducted, accept foreign
+investments, or list on a U.S. or foreign exchange.
+
+ 
+
+ iv
+
+ 
+
+ 
+
+ 
+
+Our
+Class A Ordinary Shares may be prohibited from trading on a national exchange under the Holding Foreign Companies Accountable Act (the
+ HFCA Act ) if the Public Company Accounting Oversight Board (the PCAOB ) is unable to inspect our auditors
+for two consecutive years beginning in 2021. The HFCA Act was enacted on December 18, 2020 and states if the SEC determines that a company
+has filed audit reports issued by a registered public accounting firm that has not been subject to inspection by the PCAOB for three
+consecutive years beginning in 2021, the SEC shall prohibit the company s shares from being traded on a national securities exchange
+or in over-the-counter trading market in the U.S. On March 24, 2021, the SEC adopted interim final rules relating to the implementation
+of certain disclosure and documentation requirements of the HFCA Act. A company will be required to comply with these rules if the SEC
+identifies it as having a non-inspection year under a process to be subsequently established by the SEC. The SEC is assessing
+how to implement other requirements of the HFCA Act, including the listing and trading prohibition requirements described above. On June
+22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act and on December 29, 2022, legislation entitled
+ Consolidated Appropriations Act, 2023 (the Consolidated Appropriations Act ) was signed into law by President
+Biden, which contained, among other things, an identical provision to the Accelerating Holding Foreign Companies Accountable Act and
+amended the HFCA Act by requiring the SEC to prohibit an issuer s securities from trading on any U.S. stock exchanges if its auditor
+is not subject to PCAOB inspections for two consecutive years instead of three, thus reducing the time period for triggering the prohibition
+on trading. On December 2, 2021, the SEC adopted final amendments to its rules implementing the HFCA Act. The rules apply to registrants
+the SEC identifies as having filed an annual report with an audit report issued by a registered public accounting firm that is located
+in a foreign jurisdiction and that the PCAOB is unable to inspect or investigate ( Commission-Identified Issuers ) and require
+Commission-Identified Issuers identified by the SEC to submit documentation and make disclosures required under the HFCA Act. In addition,
+the final amendments also establish procedures the SEC will follow in (i) determining whether a registrant is a Commission-Identified
+Issuer and (ii) prohibiting the trading on U.S. securities exchanges and in the over-the-counter market of securities of a Commission-Identified
+Issuer under the HFCA Act. The final amendments are effective on January 10, 2022. The SEC will begin to identify and list Commission-Identified
+Issuers on its website shortly after registrants begin filing their annual reports for 2021. Pursuant to the HFCA Act, the PCAOB issued
+a Determination Report on December 16, 2021, which found that the PCAOB is unable to inspect or investigate completely registered public
+accounting firms headquartered in mainland China or Hong Kong, a Special Administrative Region of the PRC, because of a position taken
+by one or more authorities in the PRC or Hong Kong. In addition, the PCAOB s report identified the specific registered public accounting
+firms which are subject to these determinations. On August 26, 2022, the PCAOB announced that it had signed a Statement of Protocol (the
+ SOP ) with the China Securities Regulatory Commission and the Ministry of Finance of China. The SOP, together with two protocol
+agreements governing inspections and investigations (together, the SOP Agreement ), establishes a specific, accountable
+framework to make possible complete inspections and investigations by the PCAOB of audit firms based in mainland China and Hong Kong,
+as required under U.S. law. Pursuant to the SOP Agreement, the PCAOB shall have independent discretion to select any issuer audits for
+inspection or investigation and has the unfettered ability to transfer information to the SEC. On December 15, 2022, the PCAOB Board
+determined that the PCAOB was able to secure complete access to inspect and investigate registered public accounting firms headquartered
+in mainland China and Hong Kong and voted to vacate its previous determinations to the contrary. However, should PRC authorities obstruct
+or otherwise fail to facilitate the PCAOB s access in the future, the PCAOB Board will consider the need to issue a new determination.
+
+ 
+
+Our
+auditor, Assentsure PAC, the independent registered public accounting firm that issues the audit report included in this prospectus,
+as an auditor of companies that are traded publicly in the United States and a firm registered with the PCAOB, is subject to laws in
+the United States pursuant to which the PCAOB conducts regular inspections to assess Assentsure PAC s compliance with applicable
+professional standards. Assentsure PAC is headquartered in Singapore, and it is not subject to the determinations announced by the PCAOB
+on December 16, 2021.
+
+ 
+
+These
+developments could add uncertainties to our Offering. Despite that we have a U.S. based auditor that is registered with the PCAOB and
+subject to PCAOB inspection, there are still risks to the Company and investors if it is later determined that the PCAOB is unable to
+inspect or investigate completely our auditor because of a position taken by an authority in a foreign jurisdiction. If our Class A Ordinary
+Shares are prohibited from being traded on a national securities exchange or over-the counter under the HFCA Act in the future because
+the PCAOB determines that it cannot inspect or fully investigate our auditor at such future time, Nasdaq may determine to delist our
+Class A Ordinary Shares. If our Class A Ordinary Shares are unable to be listed on another securities exchange by then, such a delisting
+would substantially impair your ability to sell or purchase our Class A Ordinary Shares when you wish to do so, and the risk and uncertainty
+associated with a potential delisting would have a negative impact on the price of our Class A Ordinary Shares.
+
+ 
+
+ v
+
+ 
+
+ 
+
+ 
+
+We
+cannot assure you whether Nasdaq or regulatory authorities would apply additional and more stringent criteria to us after considering
+the effectiveness of our auditor s audit procedures and quality control procedures, adequacy of personnel and training, or the
+sufficiency of resources, geographic reach or experience as it relates to the audit of our financial statements. It remains unclear what
+the SEC s implementation process related to the March 2021 interim final amendments will entail or what further actions the SEC,
+the PCAOB or Nasdaq will take to address these issues and what impact those actions will have on U.S. companies that have significant
+operations in the PRC and have securities listed on a U.S. stock exchange (including a national securities exchange or over-the-counter
+stock market). In addition, the March 2021 interim final amendments and any additional actions, proceedings, or new rules resulting from
+these efforts to increase U.S. regulatory access to audit information could create some uncertainty for investors, the market price of
+our Ordinary Shares could be adversely affected, trading in our securities may be prohibited and we could be delisted if we and our auditor
+are unable to meet the PCAOB inspection requirement or are required to engage a new audit firm, which would require significant expense
+and management time.
+
+ 
+
+We
+are headquartered in HK SAR and not mainland China. We do not use variable interest entities in our corporate structure. We, through
+our indirect wholly-owned subsidiaries in HK SAR and Taiwan, operate a global network of digital Creators who create and publish content
+to social media platforms such as YouTube, Facebook, Instagram, and TikTok. Because of our corporate structure as a British Virgin Islands
+holding company with operations conducted by our HK SAR and Taiwanese subsidiaries, it involves unique risks to investors. Furthermore,
+Chinese regulatory authorities could change the rules and regulations regarding foreign ownership in the industry in which we operate
+and disallow our structure, which would likely result in a material change in our operations and/or a material change in the value of
+the securities we are registering for sale, including that it could cause the value of such securities to significantly decline or become
+worthless. For a more detailed discussion, please refer to Risk Factors Risk Related To Doing Business in HK SAR 
+The recent spate of government interference by the PRC government into business activities of U.S. listed Chinese companies may negatively
+impact our operations, value of our securities and/or significantly limit or completely hinder our ability to offer future securities
+to investors and cause the value of such securities to significantly decline or be worthless on page 41. A summary of the
+applicable laws and regulations in HK SAR to the Company and its business is found on page 108. Some of the risks and challenges of conducting
+business in HK SAR include, but are not limited to political considerations involving HK SAR, higher costs of conducting business, changes
+in the currency peg system, operating in a highly-regulated environment, uncertainties in the interpretation and enforcement of Chinese
+laws and regulations and the perceived interference by the Chinese government there. Further, there is uncertainty as to whether the
+courts of the HK SAR would (i) recognize or enforce judgments of United States courts obtained against us or our directors or officers
+predicated upon the civil liability provisions of the securities laws of the United States or any state in the United States or (ii)
+entertain original actions brought in the HK SAR against us or our directors or officers predicated upon the securities laws of the United
+States or any state in the United States. A more detailed discussion of the risks of doing business in HK SAR is found under Risk
+Factors Risks Related to Doing Business in HK SAR on page 36 and the enforcement of civil liabilities in Hong Kong
+under Enforceability of Civil Liabilities on page 168.
+
+ 
+
+During
+the normal courses of our business, cash may be transferred between our companies via wire transfer to and from bank accounts to pay
+certain business expenses, as loans or capital contribution.
+
+ 
+
+Cash
+is maintained by our subsidiaries in HK SAR, Taiwan and Singapore. VS Media Limited ( VS Media HK ) has two Hong Kong Dollar
+savings accounts, two Hong Kong Dollar current bank accounts and five foreign currency savings bank accounts in HK SAR. GRACE CREATION
+LIMITED ( Grace Creation ) has one Hong Kong Dollar savings account, one Hong Kong Dollar current bank account and one foreign
+currency savings bank account in HK SAR. VS MEDIA LIMITED ( VS Media TW ) has two Taiwan Dollar savings bank accounts and
+one foreign currency savings bank account in Taiwan. VS MEDIA PTE. LTD. ( VS Media SG ) has one Singapore Dollar bank account
+in Singapore. VS Media Co Limited ( VS Media BVI ) and its wholly owned subsidiary VSM Holdings Limited ( VSM )
+both have no bank accounts. VS MEDIA Holdings Limited has one Hong Kong Dollar savings account, one Hong Kong Dollar current bank account
+and one foreign currency savings bank account in HK SAR. For a more detailed summary of cash transactions between our subsidiaries, please
+refer to Transfers of Cash to and from Our Subsidiaries on page 15.
+
+ 
+
+ vi
+
+ 
+
+ 
+
+ 
+
+We
+currently have not maintained any cash management policies that dictate the purpose, amount and procedure of cash transfers between the
+Company, our subsidiaries, or investors. Rather, the funds can be transferred in accordance with the applicable laws and regulations
+and on an as-needed basis. To the extent cash or assets in the business is in Hong Kong or in a Hong Kong entity, the funds
+or assets may not be available to fund operations or for other use outside of Hong Kong due to interventions in or the imposition of
+restrictions and limitations on the ability of us or our subsidiaries by the PRC or Hong Kong governments to transfer cash or assets.
+See Risk Factors Risk Related to Doing Business in HK SAR To the extent cash or assets in the business is in
+HK SAR or an HK SAR entity, the funds or assets may not be available to fund operations or for other use outside of HK SAR due to interventions
+in or the imposition of restrictions and limitations on the ability of us or our subsidiaries by the PRC government to transfer cash
+or assets on page 45.
+
+ 
+
+As
+of the current date, none of our companies has distributed any cash dividends or made any cash distributions. There are no restrictions
+for the transfer or distribution of cash between the companies. Please refer to the condensed consolidating schedule and the consolidated
+financial statements on page F-1.
+
+ 
+
+Neither
+the Securities and Exchange Commission nor any state securities commission nor any other regulatory body has approved or disapproved
+of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
+
+ 
+
+We
+will deliver Class A Ordinary Shares being issued to the investors electronically sold in this offering, upon closing and receipt of
+investor funds for the purchase of the securities offered pursuant to this prospectus.
+
+ 
+
+ 
+ 
+ Per Class A
+ Ordinary
+ Share 
+ Total
+ (Minimum
+ Offering) 
+ Total
+ (Maximum
+ Offering) 
+
+ 
+ 
+ 
+ 
+ 
+
+ 
+ Public offering price 
+ 
+ 
+ 
+
+ 
+ Placement
+ Agent commissions (1) 
+ 
+ 
+ 
+
+ 
+ Proceeds to us, before expenses 
+ 
+ 
+ 
+
+ 
+
+ 
+
+ 
+ (1)
+ We
+ have agreed to pay the Placement Agent a commission equal to 3.0% of the gross proceeds sold in the Offering. We have also agreed
+ to reimburse the Placement Agent for certain of its offering related expenses, including reimbursement for all travel, due diligence,
+ or related expenses. For a description of the compensation to be received by the Placement Agent, see Plan of Distribution 
+ for more information.
+
+ 
+ 
+
+No
+dealer, salesperson or any other person is authorized to give any information to make any representations in connection with this offering
+other than those contained in this prospectus and, if given or made, the information or representations must not be relied upon as having
+been authorized by us.
+
+ 
+
+Placement Agent:
+
+ 
+
+Joseph
+Gunnar & Co., LLC
+
+ 
+
+Prospectus
+dated May [ ], 2025
+
+ 
+
+ vii
+
+ 
+
+ 
+
+ 
+
+TABLE
+OF CONTENTS
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/VWAVW_visionwave_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/VWAVW_visionwave_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..a1f3e47c2af3f5be6bc3401dbc822f6821adba63
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/VWAVW_visionwave_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1
\ No newline at end of file
diff --git a/parsed_sections/prospectus_summary/2025/WBI_waterbridg_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/WBI_waterbridg_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..1716554478fb6a1859c172b7e31c5512377f74b4
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/WBI_waterbridg_prospectus_summary.txt
@@ -0,0 +1 @@
+This summary highlights certain information contained elsewhere in this prospectus concerning our business and this offering. Because this is a summary, it may not contain all of the information that may be important to you and to your investment decision in our Class A shares. The following summary is qualified in its entirety by the more detailed information and financial statements and related notes thereto included elsewhere in this prospectus. You should read this entire prospectus carefully and should consider, among other things, the matters set forth in Risk Factors and Management s Discussion and Analysis of Financial Condition and Results of Operations, as well as the historical and pro forma financial statements and related notes thereto included elsewhere in this prospectus before deciding to invest in our Class A shares. In addition, certain statements in this prospectus include forward looking information that is subject to risks and uncertainties. See Cautionary Note Regarding Forward Looking Statements in this prospectus for additional information. Unless the context otherwise requires, references in this prospectus to WaterBridge, the Company, we, our, us or like terms refer to WaterBridge Infrastructure LLC and its subsidiaries. When used in a historical context, such terms collectively refer to WaterBridge Equity Finance LLC ( WBEF ), WaterBridge NDB Operating LLC ( NDB Operating ), our predecessors for accounting purposes, and their respective operating subsidiaries. References in this prospectus to Five Point refer to Five Point Infrastructure LLC and its managed funds. References in this prospectus to Legacy WaterBridge collectively refer to NDB Operating and WBEF, together with their respective operating subsidiaries. See Glossary of Certain Industry Terms for other defined terms used in this prospectus. Unless the context indicates otherwise, the information presented in this prospectus assumes (i) a public offering price of $18.50 per Class A share (the midpoint of the price range set forth on the cover page of this prospectus) and (ii) that the underwriters option to purchase additional Class A shares is not exercised. Company Overview We are a leading integrated, pure-play water infrastructure company with operations predominantly in the Delaware Basin, the most prolific oil and natural gas basin in North America. We believe that our strategically located network, substantial scale and built-in operational redundancies provide a competitive advantage in attracting customers and allow us to achieve significant operating and capital efficiencies. We operate the largest produced water infrastructure network in the United States through which we provide water management solutions to oil and natural gas exploration and production ( E&P ) companies under long-term contracts, which include gathering, transporting, recycling and handling produced water. As of August 31, 2025, on a pro forma basis, our infrastructure network included approximately 2,500 miles of pipelines and 197 produced water handling facilities, which handled over 2.6 million barrels per day ( bpd ) of produced water for our customers and had more than 4.5 million bpd of total produced water handling capacity. We also operate two energy waste management facilities for the disposal of non-hazardous waste resulting from oil and gas E&P activities, branded under Desert Environmental. Our synergistic relationship with LandBridge Company LLC (NYSE: LB) ( LandBridge ), a leading Delaware Basin land management company, provides us preferential access to significant underutilized pore space in and around the Delaware Basin that is necessary to meet the E&P industry s evolving water handling needs. We manage our extensive infrastructure network through the use of our fit-for-purpose technology solutions, including our state-of-the-art centralized operations center and proprietary water forecasting platform, which enable us to monitor, measure and forecast water volumes in real-time across our infrastructure network and provide our customers with reliable and efficient water management solutions. The transportation, treatment and handling of produced water is crucial to oil and natural gas production. Water naturally exists in subsurface geologic formations that contain oil and natural gas deposits and is produced alongside, and typically in higher volumes than, hydrocarbons throughout the full life cycle of oil and natural gas wells. Produced water must be reliably separated and handled in order for these wells to be brought online and remain in production. From 2014 to 2024, produced water in the Delaware Basin grew from approximately 1.6 million bpd to approximately 13.2 million bpd, a compound annual growth rate ( CAGR ) of approximately 21%, outpacing the approximately 2.9 million bpd of oil production growth over the same period by approximately 8.8 million bpd. Due to the significant produced water volumes in the Delaware Basin in particular, our operations are critical to the ability of E&P companies to develop and produce oil and natural gas over the life cycle of a well. Table of Contents The information in this preliminary prospectus is not complete and may be changed. We may not sell the securities described herein until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell such securities, and it is not soliciting an offer to buy such securities, in any state or jurisdiction where the offer or sale is not permitted. Subject to completion, Preliminary Prospectus dated September 15, 2025 27,000,000 Shares WaterBridge Infrastructure LLC Class A Shares Representing Limited Liability Company Interests This is the initial public offering of Class A shares representing limited liability company interests ( Class A shares ) in WaterBridge Infrastructure LLC, a Delaware limited liability company ( WaterBridge ). We intend to elect to be classified as a corporation for U.S. federal income tax purposes. We expect that the public offering price for our Class A shares will be between $17.00 and $20.00 per Class A share. We have been authorized to list our Class A shares on each of the New York Stock Exchange (the NYSE ) and NYSE Texas, Inc. ( NYSE Texas ) under the symbol WBI. Following this offering, we will have two classes of authorized equity securities outstanding: Class A shares and Class B shares representing limited liability company interests ( Class B shares and, together with Class A shares, common shares ). Our Class B shares have no economic rights but entitle holders to one vote per Class B share on all matters to be voted on by shareholders generally. Holders of Class A shares and Class B shares will vote together as a single class on all matters presented to our shareholders for their vote or approval, except as otherwise required by applicable law or by our Operating Agreement (as defined herein). Our outstanding Class A shares and Class B shares will represent approximately 29.6% and 70.4%, respectively, of the total voting power of our outstanding common shares immediately following this offering, assuming no exercise of the underwriters option to purchase additional Class A shares, with our affiliates owning approximately 54.3% of such total voting power, without giving effect to any purchases that any of our affiliates may make through the directed share program. We are an emerging growth company under applicable federal securities laws and, as such, we have elected to take advantage of certain reduced public company reporting requirements for this prospectus and future filings. Please see the sections titled Risk Factors and Summary Emerging Growth Company. Immediately following this offering, we expect to be a controlled company within the meaning of the NYSE and NYSE Texas rules and, as a result, will qualify for and intend to rely on exemptions from certain corporate governance requirements. See Management Status as a Controlled Company for additional information. Investing in our Class A shares involves risks. See Risk Factors beginning on page 42 of this prospectus to read about factors you should consider before investing in our Class A shares. These risks include the following: Our revenues are substantially dependent on ongoing oil and natural gas exploration, development and production activity in our areas of operation. The willingness of E&P companies to engage in drilling, completion and production activities in our areas of operation is substantially influenced by the market prices of oil and natural gas, which are highly volatile. Our success largely depends on the produced water volumes we handle, which are dependent on certain factors beyond our control. Any decrease in the volumes of produced water that we handle, whether because of natural declines, producer inactivity or otherwise, could have a material adverse effect on our business and operating results. Approximately 80% of our pro forma revenue is derived from our operations in the Delaware Basin, making us vulnerable to risks associated with geographic concentration generally and the Delaware Basin specifically, including basin-specific supply and demand factors, regulatory changes and severe weather impacts that could have a material adverse effect on our business. Five Point (as defined herein) has the ability to direct the voting of a majority of our common shares and control certain decisions with respect to our management and business, including certain consent rights and the right to designate more than a majority of the members of our board as long as it and its affiliates beneficially own at least 40% of our outstanding common shares, as well as lesser director designation rights as long as it and its affiliates beneficially own less than 40% but at least 10% of our outstanding common shares. Five Point s interests may conflict with those of our other shareholders. The Five Point Members and other Existing Owners (each as defined herein), as well as their affiliates, are not limited in their ability to compete with us, and may benefit from opportunities that might otherwise be available to us. Certain provisions in our Operating Agreement (as defined herein) regarding fiduciary duties of our directors, exculpation and indemnification of our officers and directors and the approval of conflicted transactions differ from the Delaware General Corporation Law (the DGCL ) in a manner that may be less protective of the interests of our public shareholders and restrict the remedies available to shareholders for actions taken by our officers and directors that might otherwise constitute breaches of fiduciary duties if we were subject to the DGCL. Neither the U.S. Securities and Exchange Commission ( SEC ) nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. Per Class A share Total Public offering price $ $ Underwriting discount(1) $ $ Proceeds to WaterBridge (before expenses) $ $ (1)See Underwriting (Conflicts of Interest) for a description of compensation payable to the underwriters. We have granted the underwriters the option to purchase, exercisable within 30 days from the date of this prospectus, up to 4,050,000 additional Class A shares from us, at the public offering price less the underwriting discounts. At our request, the underwriters have reserved up to 10% of the Class A shares for sale at the public offering price through a directed share program to certain individuals associated with us. See Underwriting (Conflicts of Interest) Directed Share Program. Certain funds and accounts managed by Horizon Kinetics Asset Management LLC (the cornerstone investor ), have indicated an interest in purchasing up to an aggregate of $120.0 million of the Class A shares offered hereby at the public offering price and on the same terms as the other Class A shares being offered hereby. The shares to be purchased by the cornerstone investor will not be subject to a lock-up agreement with the underwriters. However, because indications of interest are not binding agreements or commitments to purchase, the cornerstone investor may determine to purchase more, less or no shares in this offering or the underwriters may determine to sell more, less or no shares to the cornerstone investor. The underwriters will receive the same discount on any of our Class A shares purchased by the cornerstone investor as they will from any other shares sold to the public. The underwriters expect to deliver the Class A shares to purchasers on or about , 2025 through the book entry facilities of The Depository Trust Company. J.P. Morgan Barclays Goldman Sachs & Co. LLC Morgan Stanley Wells Fargo Securities Piper Sandler Raymond James Stifel Texas Capital Securities Pickering Energy Partners Janney Montgomery Scott Johnson Rice & Company Roberts & Ryan Prospectus dated , 2025. Table of Contents BASIS OF PRESENTATION This is the initial public offering of Class A shares of WaterBridge. We were formed on April 11, 2025 by NDB Holdings LLC ( NDB Holdings ), which is indirectly controlled by investment funds affiliated with Five Point (as defined herein) and certain members of our management team. We have not conducted and will not conduct any material business operations prior to the completion of the transactions described under Corporate Reorganization (such transactions, the Corporate Reorganization ) other than certain activities related to, and undertaken in contemplation of, this offering, including the transactions contemplated by the WaterBridge Combination discussed below. Prior to the Corporate Reorganization, WaterBridge Resources LLC ( WaterBridge Resources ), which is controlled by an investment fund affiliated with Five Point, will form WBR Holdings LLC, a Delaware limited liability company ( WBR Holdings ), and (i) WBR Holdings, (ii) WaterBridge Resources and the other equity holders of WaterBridge Equity Finance LLC ( WBEF ), (iii) NDB Holdings and the other equity holders of NDB Midstream LLC ( NDB Midstream ) and (iv) Desert Environmental Holdings LLC ( Desert Holdings ), the equity holder of Desert Environmental LLC ( Desert Environmental and, together with WBEF and NDB Midstream, the Contributed Entities ) intend to complete a series of transactions described under Summary WaterBridge Combination (such transactions, the WaterBridge Combination ) pursuant to which all of the equity interests in the Contributed Entities will be contributed to WBI Operating LLC, a Delaware limited liability company formed by WBR Holdings ( OpCo ). Immediately following the WaterBridge Combination, OpCo will own all of the existing assets and operations of the Contributed Entities, and WBR Holdings and certain of the current equity owners of the Contributed Entities will own all of the equity interests in OpCo. The Contributed Entities were not under common control for the periods presented and NDB Midstream is the accounting acquirer in the WaterBridge Combination. For additional information, please see Summary WaterBridge Combination. Following the Corporate Reorganization, WaterBridge will be a holding company, the sole material asset of which will consist of units representing limited liability company interests in OpCo ( OpCo Units ). WaterBridge will also be the sole managing member of OpCo. Our organizational structure following the Corporate Reorganization will allow us to retain a direct equity ownership in OpCo, which will be classified as a partnership for U.S. federal income tax purposes following the offering. Investors in this offering will, by contrast, hold a direct ownership interest in us in the form of Class A shares, and an indirect ownership interest in OpCo through our ownership of OpCo Units. Although we were formed as a limited liability company, we intend to elect to be classified as a corporation for U.S. federal income tax purposes. Pursuant to our Operating Agreement and the OpCo LLC Agreement (as defined herein), our capital structure and the capital structure of OpCo will generally replicate one another and will provide for customary antidilution mechanisms in order to maintain the one for one exchange ratio between the OpCo Units and our Class A shares. For additional information, please see Corporate Reorganization and Certain Relationships and Related Party Transactions OpCo LLC Agreement. Throughout this prospectus, we present operational and financial information regarding the business of OpCo. This information is generally presented on an enterprise wide basis. However, the Class A shares to be issued to the public shareholders in this offering will initially represent a minority economic interest in OpCo. We expect that WBR Holdings and certain of the existing equity owners of the Contributed Entities will initially hold a majority of the economic interest in OpCo, as non controlling interest holders, through their ownership of a majority of the OpCo Units outstanding immediately following the closing of this offering. Immediately following this offering, affiliates of Five Point will own a number of Class A shares and Class B shares representing greater than a majority of our outstanding common shares. As a result, Five Point and its affiliates will directly control us and, consequently, will indirectly control OpCo. Because the Class A shares issued in this offering will initially indirectly represent a minority economic interest in OpCo, prospective investors should therefore evaluate performance metrics and financial information in this prospectus accordingly. To the extent that OpCo Units (along with a corresponding number of our Class B shares) are redeemed for our Class A shares (or, at our election, for cash) over time, the relative economic interests of WaterBridge and our public shareholders in OpCo s economic results will increase relative to those of the other holders of OpCo Units, including Five Point and its affiliates. Table of Contents Our customers include some of the most active and well-capitalized E&P companies in the areas in which we operate, including BPX Energy Inc. ( bpx energy ), Chevron Corporation, subsidiaries of Devon Energy Corporation (Devon Energy Corporation, together with its wholly owned subsidiaries, Devon ), EOG Resources, Inc. and Permian Resources Corporation. We serve our customers primarily under long-term, fixed-fee contracts that contain acreage dedications or minimum volume commitments ( MVCs ), with annual fee escalators tied to the Consumer Price Index ( CPI ) or similar inflation index. Many of our long-term, fixed-fee contracts also include areas of mutual interest ( AMIs ) that grant us the right to provide water management solutions on any leases or oil and natural gas wells subsequently acquired or operated by a customer within a specified area. Our long-term contracts are generally structured similarly to crude oil gathering contracts, and in most cases, we receive water volumes from our customers at a central gathering facility at the same point where crude oil gathering providers receive their respective crude oil volumes. Additionally, our long-term contracts typically grant us the exclusive right to provide water management solutions for all produced water volumes from our customers oil and natural gas wells located within the dedicated acreage, and customers are typically required to either deliver all dedicated volumes to us or pay us a fee for any diverted dedicated volumes. For the six months ended June 30, 2025, on a pro forma basis, we generated approximately 77% of our revenues under long-term, fixed-fee contracts. As of June 30, 2025, the weighted average remaining term of our long-term, fixed-fee contracts was approximately 11 years. For the six months ended June 30, 2025, on a pro forma basis, we generated approximately 51% of our water-related revenues from our top five customers and approximately 73% of our water-related revenues were generated from well-capitalized, creditworthy customers rated BB- or higher. Note: Based on water-related revenues as of June 30, 2025. Source: S&P Global Ratings and Moody s Investors Service, Inc. We believe that our proprietary data analysis technology, which we refer to as our WAVE platform, further differentiates us from our competitors. WAVE is a fully customized water forecasting software platform that we developed around our assets and our customers. The platform facilitates data gathering, logistics optimization and scenario planning in order to enhance capital efficiency across our entire network. WAVE information outputs provide insights into system capacities and forecasted production, which we make available to our customers. We believe that the WAVE platform provides us with a unique competitive advantage that allows us to work collaboratively with our customer base, optimizing field development in both the short and long term. By allowing us to more accurately determine the necessary timing and size of each system expansion, we are able to actively manage volumes and address projected system constraints in a more timely and cost-efficient manner. We developed our infrastructure network with operational redundancies designed to ensure we deliver water management solutions during maintenance activities or other temporary interruptions, providing our customers the assurance that we will handle their water management needs reliably and consistently. This flow assurance is of paramount importance to E&P companies because any prolonged interruption in produced water handling necessitates curtailing oil and natural gas production from affected wells, resulting in lower production volumes and Table of Contents Note: As of August 31, 2025. The Speedway Pipeline project is currently under development and construction is dependent on future commercialization and market viability. Table of Contents Financial and Operating Data Presentation Unless otherwise indicated, the historical financial and operating data presented herein generally consists of the financial and operating results of WBEF, WaterBridge NDB Operating LLC, a Delaware limited liability company ( NDB Operating ), and Desert Environmental and its subsidiaries. NDB Operating is an indirect, wholly owned subsidiary of NDB Midstream that indirectly owns all of the assets and operations of NDB Midstream. Prior to the WaterBridge Combination, NDB Midstream did not have any material operations, liabilities or assets other than its indirect ownership of NDB Operating. In connection with the WaterBridge Combination, OpCo will directly or indirectly acquire all of the equity interests in the Contributed Entities and their respective subsidiaries, including NDB Operating. Immediately following the WaterBridge Combination, OpCo will have no operations, income (loss), liabilities or material assets, other than its ownership of all of the outstanding equity interests in the Contributed Entities. Following the WaterBridge Combination, the financial results of WBEF, NDB Operating and Desert Environmental will be included in the consolidated financial results of OpCo, and following this offering, the financial results of OpCo will be included in the consolidated financial statements of WaterBridge. In certain instances in this prospectus, we present financial and operating data on a pro forma or pro forma, as adjusted basis, as applicable. As used herein and as applicable based on the periods presented, these references have the following meanings: the term pro forma when used with respect to financial data refers to the combined historical financial data of WBEF, NDB Operating, Desert Environmental and their respective subsidiaries, as adjusted to give effect to the WaterBridge Combination, unless otherwise indicated; and the term pro forma, as adjusted when used with respect to financial data refers to the combined historical financial data of WBEF, NDB Operating, Desert Environmental and their respective subsidiaries, as adjusted to give effect to the WaterBridge Combination, the Corporate Reorganization and this offering and the application of the net proceeds therefrom, unless otherwise indicated. Unless otherwise indicated, pro forma financial data for the year ended December 31, 2024 gives effect to the WaterBridge Combination as if the WaterBridge Combination had been consummated on January 1, 2024, in the case of the statement of operations data. Unless otherwise indicated, pro forma financial data for the three months and six months ended June 30, 2025, respectively, gives effect to the WaterBridge Combination as if the WaterBridge Combination had been consummated on January 1, 2024, in the case of the statement of operations data, and June 30, 2025, in the case of the balance sheet data. Unless otherwise indicated, pro forma, as adjusted, financial data for the year ended December 31, 2024 gives effect to the WaterBridge Combination, the Corporate Reorganization and this offering and the application of the net proceeds therefrom as if each transaction had been consummated on January 1, 2024, in the case of the statement of operations data. Unless otherwise indicated, pro forma, as adjusted, financial data for the three months and six months ended June 30, 2025, respectively, gives effect to the WaterBridge Combination, the Corporate Reorganization and this offering and the application of the net proceeds therefrom as if each transaction had been consummated on January 1, 2024, in the case of the statement of operations data, and June 30, 2025, in the case of the balance sheet data. The pro forma and pro forma, as adjusted, financial data is presented for illustrative purposes only and should not be relied upon as an indication of the financial condition or the operating results that would have been achieved if the WaterBridge Combination, the Corporate Reorganization and this offering and the use of proceeds therefrom, as applicable, had taken place on the specified dates. In addition, future results may vary significantly from the results reflected in such pro forma and pro forma, as adjusted, financial data and should not be relied on as an indication of future results. Please refer to our unaudited pro forma condensed combined financial statements and the related notes thereto included elsewhere in this prospectus for additional information. Table of Contents decreased revenue for the producer. Our proprietary WAVE technology and centralized operations center further enhance our ability to provide flow assurance to our customers by allowing real-time monitoring and optimization of our water management operations via a network of sensors, meters, cameras, in-field computers and private radio tower infrastructure. We believe that our ability to provide reliable flow assurance is a competitive advantage that enables us to attract new customers and obtain additional business from existing customers. We believe our large-scale network and built-in operational redundancies provide a competitive advantage relative to the alternatives available to E&P companies, including developing their own water management infrastructure networks, which requires significant capital investment. We also believe that our existing footprint provides us with significant growth opportunities to expand our current dedicated acreage and broaden our customer base. We share a financial sponsor, Five Point, and our management team with LandBridge. As of August 31, 2025, LandBridge owned approximately 277,000 surface acres in and around the Delaware Basin. Five Point and our management team initially formed LandBridge to acquire, manage and expand a strategic land position in the heart of the Delaware Basin to support the development of our large-scale water infrastructure network, including by providing access to pore space for handling produced water that has been gathered and transported on our pipelines. Additionally, these relationships provide our shared management team visibility into key areas of oil and natural gas production and long-term trends that have materialized into commercial successes for us, including a strategic partnership with Devon and recent commercial agreements with bpx energy. We have rights to develop produced water handling facilities on a significant portion of LandBridge s surface acreage, including approximately 1.2 million bpd of existing produced water handling capacity and approximately 2.3 million bpd of additional permitted capacity available for future development, in each case as of August 31, 2025, on a pro forma basis. In 2023, we entered into a long-term strategic partnership with Devon pursuant to which Devon committed all its produced water within a large AMI, including an initial dedication of approximately 52,000 acres, and contributed to us 18 produced water handling facilities with approximately 375,000 bpd of permitted capacity and approximately 210 miles of produced water pipelines for gathering, transportation, disposal and reuse in exchange for an equity interest in one of our predecessor companies. Following the WaterBridge Combination and our Corporate Reorganization (each as defined below), Devon will own 17,692,370 Class B shares, representing 15.5% of our common shares, and an approximate 15.5% interest in OpCo. Our organizational structure following the offering and the Corporate Reorganization is commonly referred to as an umbrella partnership-C corporation (or Up-C ) structure. Pursuant to this structure, following this offering we will hold a number of OpCo Units equal to the number of our issued and outstanding Class A shares, and holders of OpCo Units (each, an OpCo Unitholder ) (other than us) will hold a number of OpCo Units equal to the number of our issued and outstanding Class B shares. The Up-C structure was selected in order to (i) provide our Existing Owners with an option to continue to hold their economic ownership interests in our business in pass-through form for U.S. federal income tax purposes through their ownership of OpCo Units and (ii) potentially allow our Existing Owners and us to benefit from certain net cash tax savings that we might realize in the future, as more fully described in the subsection titled Certain Relationships and Related Party Transactions Tax Receivable Agreement. Our Assets We operate the largest integrated produced water infrastructure network in the United States. Our current areas of operation include the Delaware Basin in West Texas and New Mexico, the Eagle Ford Basin in South Texas and the Arkoma Basin in Oklahoma. From January 1, 2018 to August 31, 2025, we constructed approximately 980 miles of pipelines and 66 produced water handling facilities across our areas of operation. As of August 31, 2025, on a pro forma basis, our infrastructure network included approximately 2,500 miles of pipelines and 197 produced water handling facilities with more than 4.5 million bpd of produced water handling capacity supported by approximately 2.3 million acres dedicated to us under long-term, fixed-fee contracts with E&P companies. This network is supported by our field personnel and automated in-field equipment, including pumps, valves and cameras that are managed by our operations center on a continuous basis. Desert Environmental, our energy waste management business, operates two energy waste management facilities for the disposal and handling of non-hazardous waste in the Delaware Basin. We and LandBridge also entered into agreements with Texas Pacific Land Company ( TPL ), one of the largest landowners in Texas, to provide reciprocal crossing rights across an approximately 64,000 acre AMI near and along the Texas-New Mexico state border that, together with our access to LandBridge s surface acreage, provides us access to semi-contiguous, or checkerboarded, acreage necessary to develop large scale water infrastructure assets in the area. Through these agreements, we have access to TPL s surface within the AMI for pipeline rights of way and the right to operate produced water handling facilities within the AMI as well as the exclusive right to market and sell produced water within the AMI, subject to customary royalty and revenue-sharing payments. As of August 31, Table of Contents INDUSTRY DATA Certain market and industry data and other statistical information used throughout this prospectus have been obtained from the following independent industry sources as well as from research reports prepared for other purposes: (i) B3 Insights; (ii) Enverus; (iii) Pickering Energy Partners; and (iv) Center for Injection and Seismicity Research. Some market data and statistical information contained in this prospectus are also based on management s estimates and calculations, which are derived from our review and interpretation of publicly available industry publications, our internal research and our knowledge of the markets in which we currently operate and, as of the date of this prospectus, anticipate operating in the future. This information involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such information. Forecasts and other forward looking information obtained from these sources are subject to the same qualifications and uncertainties as the other forward looking statements in this prospectus. While we are not aware of any misstatements regarding the industry data presented herein, this information and these estimates involve risks and uncertainties and are subject to change based on various factors, including those discussed under the headings Risk Factors and Cautionary Note Regarding Forward Looking Statements in this prospectus. TRADEMARKS AND TRADE NAMES We own or have rights to various trademarks, service marks and trade names that we use in connection with the operation of our business. This prospectus may also contain trademarks, service marks and trade names of third parties, which are the property of their respective owners. Our use or display of third parties trademarks, service marks, trade names or products in this prospectus is not intended to, and does not, imply a relationship with us or endorsement or sponsorship by or of us. Solely for convenience, the trademarks, service marks and trade names referred to in this prospectus may appear without the , TM or SM symbols, but the omission of such references is not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or the right of the applicable owner or licensor to these trademarks, service marks and trade names. Table of Contents 2025, we have constructed approximately 700,000 bpd of produced water handling capacity within the AMI, with approximately 500,000 bpd of additional permitted capacity available to us within the AMI for future development. In January 2025, we announced commercial agreements with bpx energy that include 10-year MVCs to support our long-term development plans in the Delaware Basin. In connection with these commercial agreements, we agreed to construct large-diameter transportation pipelines and additional handling facilities, which we refer to as the bpx energy Project, in order to transport and handle produced water from bpx energy s development locations in Reeves County, Texas. This infrastructure was completed in July 2025 and includes initial capacity of approximately 450,000 bpd, with the ability to increase capacity to approximately 600,000 bpd. On April 1, 2025, we announced the launch of an open season to solicit commitments from E&P companies to support our construction of a large diameter transportation pipeline, which we refer to as the Speedway Pipeline, that will extend across the northern Delaware Basin and connect Eddy and Lea counties to out-of-basin pore space in the Central Basin Platform owned by LandBridge. Subject to the successful completion of commercial negotiations with potential customers, we expect to commence construction of the Speedway Pipeline during the fourth quarter of 2025 and estimate that total development costs will be approximately $290.0 million, consisting of approximately $220.0 million for the Speedway Pipeline and associated produced water handling facilities and approximately $70.0 million for additional infrastructure to connect the pipeline to customer receipt points, including costs associated with the complementary New Devon Project (as defined below). We expect to incur approximately $72.0 million of capital expenditures in the fourth quarter of 2025 and approximately $162.0 million of capital expenditures in the first half of 2026, and that the Speedway Pipeline and related handling facilities will be completed and in service by mid-2026. We expect to fund construction of the project with cash on hand and borrowings under our Existing Revolving Credit Facilities or, if applicable, our New Revolving Credit Facility (as defined below). For additional information about our New Revolving Credit Facility, please see Expected Refinancing Transactions below. If it is completed, we expect that the Speedway Pipeline will provide access to approximately 1.0 million bpd of approved produced water capacity in the Central Basin Platform and will enhance flow assurance and redundancy for our customers utilizing LandBridge s significant pore space capacity. In August 2025, we entered into a 10-year commercial agreement with Devon Energy Production Company, L.P. that includes a 7.5-year MVC, commencing on April 1, 2027, for the transportation and handling of Devon produced water volumes from certain development locations in Eddy and Lea counties, New Mexico, which we refer to as the New Devon Project. As part of this agreement, we agreed to construct certain large diameter pipelines and related handling facilities to transport Devon s produced water to pore space leased by Devon from LandBridge in Loving and Andrews counties, Texas. A portion of these pipelines will constitute a segment of the Speedway Pipeline. The construction and commissioning of any expansion project, including the Speedway Pipeline, is subject to numerous uncertainties, and we can provide no assurances that any such project will be executed on the terms or on the timetables estimated for such expansion project. The table below includes a summary of our operating assets, produced water handling capacity, acreage dedications, AMI acres and percentage of produced water handling volumes by area of operation as of August 31, 2025, each on a pro forma basis. Pipeline Miles(1)(2) Water Handling Facilities(2)(3) Handling Capacity (Bbl/d) Acreage Dedications (acres) AMI Acres Percentage of Water Handling Volumes Delaware Operating 1,767 167 3,906,850 728,164 2,820,728 88.0 % Under Development 106 1 35,000 Total Delaware 1,873 168 3,941,850 728,164 2,820,728 88.0 % Eagle Ford Operating 457 18 412,500 874,303 880,299 10.0 % Under Development Total Eagle Ford 457 18 412,500 874,303 880,299 10.0 % Arkoma Operating 270 12 195,440 733,069 2,623,209 2.0 % Under Development Total Arkoma 270 12 195,440 733,069 2,623,209 2.0 % Combined Total 2,600 198 4,549,790 2,335,537 6,324,236 100.0 % Table of Contents (1)Excludes gas transportation pipelines. (2)Includes assets that have been publicly announced or that are under construction and are expected to be placed into service in 2025. (3)Includes produced water disposal wells and other recycling and reuse facilities. Note: As of August 2025. The Speedway Pipeline project is currently under development and construction is dependent on future commercialization and market viability. In total, our integrated infrastructure network allows us to offer a full suite of end-to-end produced water management solutions, making us a single source provider of solutions for our E&P customer universe. Our extensive asset base provides us the ability to gather produced water directly from third-party producing well sites. From there, we are able to transport produced water volumes to our water handling facilities, where we remove mineral solids and any residual skim oil from the water. Once the water has been processed at our water handling facilities, we either dispose of the water via underground injection or recycle the water through our water recycling facilities for use in drilling and completion operations. We believe that there will be future opportunities for the beneficial reuse of water for agricultural and industrial purposes, which could provide us with additional revenue opportunities. While these additional use cases are unlikely to materialize at scale in the near-term, we evaluate new opportunities on an ongoing basis, and we believe that we are well positioned to take advantage of such opportunities given our extensive infrastructure network, industry experience and access to LandBridge s surface. Table of Contents The following diagram illustrates the breadth of our operations and how they interconnect with the drilling operations of our E&P customers. Our produced water infrastructure network is an integral part of the oil and gas production process. This process begins with in-field gathering from E&P well pads, where water is produced alongside hydrocarbons throughout the lifecycle of an oil and gas well. Our infrastructure typically connects to our customer s field operations at or near central gathering facilities ( CGFs ). We receive produced water via pipeline interconnections located at CGFs or wellhead receipt points, typically constructed and operated by E&P customers that aggregate and process production from multiple wells. Thereafter, produced water is transported to our water handling facilities or delivered for reuse for well completions directly from our integrated pipeline network. At our water handling facilities, the produced water is processed by removing skim oil and solids, and then the majority of produced water is sequestered underground with the remainder of the produced water being reused or recycled. To meet significant and growing demand for water reuse and recycling, we have strategically co-located recycling infrastructure with produced water handling facilities to optimize costs, with risers located approximately every mile along our pipeline infrastructure which allow our E&P customers ease of access to our integrated pipeline network for both delivery and reuse. Our Business Model Our business model focuses on establishing long-term operating relationships with E&P companies to develop water infrastructure solutions throughout the full life cycle of their oil and natural gas wells. These relationships are generally characterized by long-term, fixed-fee customer contracts, with 69% of such contracts having an initial primary term of at least 15 years. As of June 30, 2025, our long-term, fixed-fee customer contracts had a weighted average remaining life of approximately 11 years and included approximately 2.3 million acres dedicated to us. We plan to grow our business by maintaining our track record of prudent capital allocation, relying on our management team s expertise in developing, acquiring, integrating and operating water infrastructure assets and entering into additional long-term agreements that include acreage dedications or MVCs with new and existing customers as we expand our water infrastructure network. We believe that our customers choose to partner with us because of the flow assurance we provide and the capital efficiencies offered by a scalable water handling network that aggregates volumes from multiple producers. We have built substantial redundancies in our infrastructure network and developed an industry-leading, proprietary technology platform, allowing us to maintain a 99.7% average operational up-time. The challenges of developing a single Table of Contents producer network have grown as E&P companies have shifted to larger pad developments with more wells drilled from a single pad and longer horizontal laterals, resulting in greater volumes of water concentrated within a given surface location. An E&P company must shut-in oil and natural gas production if it does not have reliable offtake for its produced water volumes, which provides a significant economic incentive to ensure reliable produced water handling capacity. While many E&P companies initially developed and operated their own localized produced water handling networks given the importance of flow assurance to their production operations, we believe that the capital expenditures required to develop a single-producer water infrastructure network that is capable of handling pad development and significantly higher initial production volumes is an inefficient use of capital for E&P companies. By aggregating volumes from multiple producers, a third-party network can realize higher utilizations and improve the economics of infrastructure development, allowing E&P customers to redeploy capital for use in development and production activities instead of developing and maintaining water infrastructure. We manage our extensive infrastructure network through the use of our state-of-the-art centralized operations center. Our operations center is the purpose-built centralized communication hub for our business and is responsible for coordinating activities between our field operations and external stakeholders. Our operations center is staffed 24 hours per day, seven days per week and enables us to continually monitor data from various devices to ensure we are able to promptly detect and respond to any anomalies or emergencies. This includes tracking pressures, temperatures, flow rates, mechanical equipment and alarms, with the ability to control over 10,000 direct control inputs per month. We have over 800 live camera feeds that are continuously monitored and assist in our detection efforts. This infrastructure allows us to achieve a less than 2% error rate in monitoring volumes into and off our system, a figure we believe is industry leading. We employ a number of different monitoring systems, such as camera leak detection artificial intelligence ( AI ) and optical gas imaging, designed to ensure the safety of our people, our assets and our environment. In addition to field coordination and safety management, our operations center includes field automation capabilities through which we remotely optimize injection, improve efficiency and reduce costs. Such adjustments include remotely controlling the speed of pumps, opening and closing valves, regulating automation setpoints and optimizing electrical power usage. Through these comprehensive monitoring and optimization efforts, we believe that our operations center has provided us with significant financial benefits in reduced labor costs and operational efficiencies. Our long-term contracts are structured similarly to traditional crude gathering contracts. Key features of our long-term contracts include: Long Term an initial term of 15 years for a majority of our long-term contracts, with a weighted-average remaining term of approximately 11 years as of June 30, 2025; Fixed Fee a per-barrel fixed fee charged to transport and handle produced water volumes; Acreage Dedications and AMIs dedications of large acreage positions in which, other than diverted volumes described below, all produced water is required to be handled by our integrated network and, for certain of our contracts, AMIs designating areas in which producers will dedicate subsequently acquired or leased acreage and oil and natural gas wells to us; MVCs for certain of our contracts, MVCs, which require our customers to deliver, or pay for the delivery of, certain minimum volumes of produced water over specific time periods, which often serve to underwrite return thresholds on initial capital outlays and are intended to generate predictable cash flows; Fee Escalators annual fee escalation tied to the CPI or similar inflation index for substantially all of our long-term contracts; and Fees for Diverted Volumes a per-barrel fixed fee for produced water volumes diverted by customers subject to acreage dedications prior to delivery to us, or redelivered by us, or for use in drilling and completion operations, which fees approximate or exceed the same net margin we would have received had we transported and handled the diverted or redelivered volumes. In addition, we typically receive the exclusive right to recycle produced water volumes generated by our customers from their dedicated acreage. In addition to organic growth opportunities, we routinely evaluate opportunities to acquire produced water assets owned by E&P companies or third-party water infrastructure companies. We believe that scale is critical for operational and capital efficiency of water handling and that there will be opportunities to expand our existing network through opportunistic acquisitions. Several of our customers commenced or expanded their commercial relationship with us by selling their water assets to us and signing long-term contracts in connection with the sale. We expect to continue to prioritize acquisitions of producer-owned water infrastructure assets over third-party assets due, in part, to the opportunity to enter into favorable long-term contracts as part of the transaction. Table of Contents Sources of Revenue We generate revenue primarily by charging produced water handling fees for transporting produced water for disposal into our produced water handling facilities and, to a lesser extent, by providing raw or recycled produced water to customers for reuse in drilling and completion operations. By focusing on produced water handling, our revenues are tied primarily to the long-life production of oil and natural gas wells rather than drilling activity, which can be more cyclical in nature. We report our revenue in the following categories. Produced Water Handling. We charge a fixed fee whether produced water is handled by our produced water handling facilities or recycled. Under some of our customer contracts, we receive separate fees for transportation and handling or recycling of produced water, while in other contracts we receive a combined fee for both services. Our results are driven primarily by the fees we charge and the volumes of produced water transported for handling or recycling on our network. We also sell oil recovered as a byproduct of the produced water we handle, which is referred to as skim oil. Water Solutions. We sell brackish and produced water to our customers for use in their drilling and completion operations. We also provide produced water treatment and recycling services and sell recycled water to our customers for use in drilling and completion operations. We charge contracted fees per barrel of water sold. Other. In the Arkoma Basin, we receive fees for gas transportation services. In the Delaware Basin, we receive fees by providing solid waste management and reclamation services. We do not expect gas transportation fees and solid waste and reclamation fees to comprise a significant portion of our future revenues. Financial Performance WBEF NDB Operating Pro Forma Pro Forma, as adjusted Three Months Ended June 30, Six Months Ended June 30, Year Ended December 31, Three Months Ended June 30, Six Months Ended June 30, Year Ended December 31, Six Months Ended June 30, Year Ended December 31, Six Months Ended June 30, Year Ended December 31, 2025 2024 2025 2024 2024 2023 2025 2024 2025 2024 2024 2023 2025 2024 2025 2024 (Dollars in thousands, except per barrel data) Total revenues $86,139 $85,241 $166,335 $167,845 $329,416 $364,463 $95,512 $73,884 $193,422 $139,285 $316,296 $200,767 $374,876 $662,164 $374,876 $662,164 Net (loss) income $(15,607) $(20,065) $(29,821) $(44,503) $(76,803) $(6,339) $7,125 $(4,173) $8,836 $(842) $2,992 $14,667 $(38,000) $(112,274) $(29,170) $(90,391) Net (loss) income margin (18)% (24)% (18)% (27)% (23)% (2)% 7% (6)% 5% (1)% 1% 7% (10)% (17)% (8)% (14)% Adjusted EBITDA (1) $49,347 $49,045 $92,881 $95,131 $191,225 $218,296 $40,568 $33,761 $90,681 $65,796 $149,740 $95,160 $184,978 $340,299 $192,375 $347,101 Adjusted EBITDA Margin (1) 57% 58% 56% 57% 58% 60% 42% 46% 47% 47% 47% 47% 49% 51% 51% 52% Gross margin $22,108 $27,359 $43,522 $51,240 $91,295 $126,644 $25,493 $20,936 $60,416 $38,245 $88,448 $55,302 $84,560 $130,652 $84,342 $130,216 Adjusted Operating Margin (1) $54,024 $54,960 $102,820 $106,671 $211,343 $237,740 $46,641 $38,912 $102,602 $75,188 $166,763 $103,738 $215,961 $385,979 $215,743 $385,543 Daily produced water handling volumes (MBbls) 1,162 1,156 1,117 1,141 1,122 1,214 1,213 920 1,205 884 1,002 687 2,322 2,124 2,322 2,124 Total volumes (MBbls) 112,621 112,760 219,135 222,608 433,616 493,551 129,549 103,366 271,244 192,115 428,652 289,888 490,379 862,268 490,379 862,268 Adjusted Operating Margin/Barrel (1) $0.48 $0.49 $0.47 $0.48 $0.49 $0.48 $0.36 $0.38 $0.38 $0.39 $0.39 $0.36 $0.44 $0.45 $0.44 $0.45 Net Debt (1) $1,145,105 $1,145,105 $1,114,354 $1,104,631 $628,833 $628,833 $596,090 $325,268 $1,785,035 1,550,477 Ratio of Net Debt to Annualized Adjusted EBITDA 5.80x 6.16x 5.83x 5.06x 3.88x 3.47x 3.98x 3.42x 4.83x 4.03x (1)Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Operating Margin, Adjusted Operating Margin per Barrel, and Net Debt are Non-GAAP financial measures. See Summary Historical and Pro Forma Financial Data Non-GAAP Financial Measures below for more information regarding these non-GAAP measures and reconciliations to the most comparable GAAP measures. Table of Contents Industry Summary The underlying industry of our customer base is the upstream oil and natural gas sector in the United States, which includes major producing regions across the country. Our operations are centered in the Delaware Basin, a sub-basin of the Permian Basin, the most active oil and natural gas producing region in the United States. With 38% of current onshore rigs, the lowest break-even operator economics and approximately 33,000 remaining economic locations (the most out of any Lower 48 basin), the Delaware Basin is the most prolific oil and natural gas basin in North America. The Delaware Basin in particular has experienced significant growth over the past decade, with oil production increasing more than eight-fold since 2014 and water production following a similar trajectory. This growth is driven primarily by drilling activity from large, well-capitalized upstream producers, many of whom are our significant customers. We believe that our integrated water infrastructure network and comprehensive water handling solutions position us as an ideal partner to support these producers operations. The Permian Basin, and specifically the Delaware Basin, has consistently attracted substantial drilling activity, even amidst varying commodity prices and macroeconomic conditions. As of June 30, 2025, there were 244 drilling rigs in the Permian Basin, representing 61% of all rigs running in the United States, with 143 rigs running in the Delaware Basin alone, according to Enverus. Note: As of June 30, 2025. Source: Enverus, data and analytics derived from Enverus PRISM July 2025. Note: As of June 30, 2025. Source: Enverus, data and analytics derived from Enverus PRISM July 2025. (1) YTD 2025 as of June 2025. Table of Contents As presented in the below charts, the intensity of drilling activity generally corresponds to the concentration of original oil in place. Wolfcamp A Original Oil in Place Note: As of June 30, 2025. Source: Enverus, data and analytics derived from Enverus PRISM June 2025. Table of Contents Last 24 Months Rig Intensity Note: As of June 30, 2025. Source: Enverus, data and analytics derived from Enverus PRISM June 2025. The region has seen significant advancements in drilling efficiency, largely due to pad development and technological innovations, which have increased the number of wells turned-in-line ( TIL ) per rig. This efficiency is crucial as it allows for the maximization of production and well economics, further driving the demand for effective water management solutions. Water management is a critical component of upstream oil and natural gas operations, particularly in unconventional basins like the Permian. The process involves the supply of water for hydraulic fracturing, the separation and disposal of produced water, and increasingly, the recycling of produced water for reuse. Water management costs represent a significant portion of upstream producers lease operating expenses ( LOE ), particularly in the Delaware Basin, where they can account for 30 to 40% of total LOE. As producers continue to extend lateral lengths and increase production, the demand for efficient water management solutions is expected to grow, underscoring the importance of our operations in supporting the industry s evolving needs. As discussed above, flow assurance is of paramount importance to E&P companies because any prolonged interruption in produced water handling can lead to lower oil and natural gas production. As a result, E&P companies recognize the critical nature of having robust water management infrastructure in place to support their operations. According to the Federal Reserve Bank of Dallas, as of the first quarter of 2025, approximately 74% of executives from 104 surveyed E&P companies anticipate drilling and completion constraints in the Permian Basin within the next five years due to insufficient produced water infrastructure. Industry leaders continue to pay close attention to the availability and limitations of water infrastructure systems serving active basins and are eager to partner with water infrastructure operators that can provide reliable produced water handling solutions. Table of Contents The Railroad Commission of Texas (the TRRC ), the primary regulatory body for oil and gas exploration, production and transportation in Texas, including well regulation, recently issued updated permitting guidelines for produced water handling facilities in the Permian Basin that went into effect on June 1, 2025. The guidelines apply to new and amended produced water handling facility permit applications for all industry operators in the basin and introduce and expand restrictions on the location and operations of new and amended water handling facilities with the intent to mitigate and avoid issues that can arise in areas with high pore pressure in the underlying geologic formations. In general, these guidelines should encourage less geographic concentration of produced water handling facilities in the Permian Basin. We believe these guidelines enhance the value of our large-scale, integrated water infrastructure platform because we are well-positioned to move produced water volumes away from areas with high pore pressure to areas with underutilized pore space and correspondingly lower pore pressure. Furthermore, because of our preferential access to LandBridge s surface acreage, which benefits from having underutilized pore space, and our existing water handling facility permits in low pore pressure areas, we expect to be able to continue to dispose of produced water volumes in compliance with these guidelines. Source: New Mexico Oil Conservation Division and B3 Insights and Pickering Energy Partners analysis. (1) YTD 2025 as of June 2025. From January 1, 2025 through June 30, 2025, we obtained 19 produced water injection permits, which represents 39% of the total permits approved by the Texas and New Mexico state regulatory agencies for the Delaware Basin during that period. Note: As of June 30, 2025. Source: Enverus, data and analytics derived from Enverus PRISM July 2025. (1) Permits submitted as of June 2025. Table of Contents Growth Trends of Produced Water The Delaware Basin has experienced significant growth in oil and natural gas production activity over the last four years, with approximately 33% and 31% growth in wells brought online and active drilling rigs, respectively, according to Enverus. We believe that this growth in production activity will require increased produced water handling capacity, as the amount of produced water from wells in the Delaware Basin significantly exceeds the amount of the related oil and natural gas production. Specifically, for every barrel of oil produced in the Delaware Basin in 2024, approximately 3.7 barrels of associated water were produced, according to Enverus. Produced water volumes have increased as oil and natural gas production has increased in the Delaware Basin over the last several years. From 2014 to 2024, produced water in the Delaware Basin grew from approximately 1.6 million bpd to approximately 13.2 million bpd, a CAGR of approximately 21%. Historical and forecasted Delaware Basin produced water volumes as of December 31, 2024, including the anticipated incremental increase in produced water volumes that could be recycled or handled in existing or new produced water handling facilities, are shown in the graphic below, in each case according to Pickering Energy Partners and B3 Insights. Delaware Basin Produced Water Volumes Note: As of June 30, 2025. Source: B3 Insights and Pickering Energy Partners analysis. The amount of available pore space and the permeability of a geological formation are essential for successful produced water injection. Porosity affects storage capacity and permeability affects fluid movement, while both together affect formation pressure. Lower formation pressure allows for more water to be injected, and as more volume is injected into the geological reservoir, formation pressure increases. Once a certain limit of formation pressure is reached, injection is limited both operationally and by the applicable injection permits issued by state regulatory agencies. Produced water handling facilities are legally constrained by permitted maximum daily injection rates and maximum wellhead pressures. In some instances, the operational capacity of a produced water handling facility is restricted by formation pressure, preventing the facility from achieving its full permitted capacity. The sequestration of produced water volumes in high pore pressure areas is operationally restricted due to a lack of available pore space for the injected water. These operational capacity restrictions are more common in geographic regions with higher concentrations of produced water handling facilities. Continued injection of produced water in these regions is expected to further increase formation pressure and result in further declines in these facilities operational capacities over time. There are two sandstone formations in the Delaware Basin that are suitable for long-term produced water injection: a relatively shallower layer called the Delaware Mountain Group, which is located approximately 4,500 to 7,500 feet below the surface on average, with thickness of 2,500 to 3,000 feet on average, and a deeper layer called the Ellenburger Group, which is located approximately 12,000 to 17,000 feet below the surface on average. In the absence of any new development of produced water handling facilities, the Delaware Basin is projected to have constrained water handling capacity by 2029. Under this scenario, beginning in 2025, incremental produced water volumes will need to be recycled, as the availability of produced water facilities will not be sufficient to keep up with demand for produced water handling capacity. In the absence of adequate recycling demand and produced Table of Contents water handling capacity, operators may have to shut-in production or delay completion of new wells, as they will not have sufficient available capacity for the handling of their produced water volumes. Permian Basin Water Volumes by Handling Method vs. Operational Produced Water Handling Capacity (million bpd) Note: As of June 30, 2025. Source: B3 Insights and Pickering Energy Partners analysis. (1) Assumes a 20% decrease in basin wide operational produced water handling capacity to account for logistical inefficiencies within the Permian Basin; (2) Based on the 2023-2024 average number of new produced water handling facilities per year; (3) Sub-plays are limited to two total produced water handling facilities and shallow production wells per section, and there are assumed to be no new shallow production wells drilled; (4) Assumes zero new deep production wells will be drilled. Produced water handling facilities and their access to specific geologic zones are regulated at the state level and are required to meet guidelines imposed by the relevant state agencies. Because the Delaware Basin straddles the Texas-New Mexico state border, the planning, permitting and building of water infrastructure is dependent upon the laws and regulations of either Texas or New Mexico. Historically, Texas has had a more supportive regulatory and permitting environment than New Mexico, and consequently, there has been more limited growth in produced water handling capacity in New Mexico because of fewer new produced water handling permit approvals. As a result, producers have been injecting produced water associated with New Mexico oil and gas production in Texas, especially along the Texas-New Mexico state line, causing increased pore pressure in high activity areas. Note: As of June 30, 2025. Source: B3 Insights and Pickering Energy Partners analysis. Table of Contents The Stateline AOI shown in the graphic below is projected to remain the highest demand produced water handling area within the Delaware Basin over the next 10 years according to Pickering Energy Partners and B3 Insights, primarily due to its close proximity to E&P development in New Mexico. However, produced water handling capacity in this area is projected to decline at a rate approximately 70% faster than that of the broader Delaware Basin according to Pickering Energy Partners and B3 Insights, largely driven by regulatory constraints stemming from over-concentration of injection, leading to high pore pressure. We proactively addressed this issue by strategically securing approximately 2.3 million bpd of permitted capacity across low pore pressure areas within and adjacent to the Stateline AOI as of August 31, 2025 as an alternative produced water handling solution for E&P operators. Furthermore, as of August 31, 2025, we are actively working to obtain approximately 2.0 million barrels per day of additional permitted capacity in such low pore pressure areas, positioning us to address future water handling demand within the Delaware Basin. Stateline AOI Will See Significant Reduction in Disposal Capacity Note: As of July 31, 2025. Source: B3 Insights Pressure and Capacity Forecast, Permian Basin, 2025. Assets and Pore Pressure in Delaware Basin Stateline AOI Note: As of June 30, 2025. Source: Enverus, data and analytics derived from Enverus PRISM June 2025 and B3 Insight Pressure and Capacity Forecast, Permian Basin, 2025. Table of Contents Delaware Basin Produced Water is Expected to Outpace Disposal Capacity Note: As of July 31, 2025. Source: B3 Insights Pressure and Capacity Forecast, Permian Basin, 2025. Our existing and planned water infrastructure buildout is designed to facilitate the movement of produced water volumes from New Mexico to Texas, where our water handling facilities can sequester produced water volumes more readily, and from areas of high pore pressure within Texas to areas with underutilized pore space. Note: As of August 31, 2025. Table of Contents Our Relationship with LandBridge We share a financial sponsor, Five Point, and our management team with LandBridge. As of August 31, 2025, LandBridge owned approximately 277,000 surface acres in and around the Delaware Basin. Five Point and our management team initially formed LandBridge to acquire, manage and expand a strategic land position in the heart of the Delaware Basin to support the development of our large-scale produced water infrastructure. We believe that expected future growth of produced water volumes in the Delaware Basin will require additional, underutilized pore space to allow for proper sequestration. LandBridge s surface acreage is strategically located in proximity to significant producer activity and has access to largely underutilized pore space, offering critical capacity for produced water handling. As of August 31, 2025, on a pro forma basis, we operated approximately 1.2 million bpd of produced water handling capacity on LandBridge s surface acreage, with approximately 2.3 million bpd of additional permitted capacity available to us for future development. We have exclusive rights to construct up to 30 initial produced water handling facilities on a portion of LandBridge s surface acreage located along the eastern portion of the Texas-New Mexico state border, with contracted access for additional facilities in excess of that amount. We believe that our relationship with LandBridge and our preferential access to largely underutilized pore space, when combined with our management team s extensive experience in the produced water industry, are competitive strengths. Our Relationship with Five Point Five Point is a private equity and infrastructure investor with 13 years of sector specialization focused on building water management, surface management, powered land, and sustainable infrastructure businesses in North America. The firm was founded by industry veterans with over 150 years of direct industry experience and is managed by partners with over 60 years of combined experience in successfully investing in, building, and running infrastructure companies. Five Point s strategy is to buy and build assets, create companies, and grow them into sustainable enterprises with premier management teams and industry-leading partners. Based in Houston, Five Point targets equity investments ranging from approximately $50 million to $1 billion and, as of June 30, 2025, had approximately $8.5 billion of assets under management across multiple investment funds. Five Point s investments include numerous other portfolio companies, including LandBridge, PowerBridge LLC ( PowerBridge ), Deep Blue Midland Basin LLC ( Deep Blue ) and San Mateo Midstream, LLC ( San Mateo Midstream ), a midstream strategic joint venture with Matador Resources Company ( Matador ). Immediately following this offering, investment funds managed by Five Point will indirectly own a majority of our common shares and will continue to own a majority of the common shares of LandBridge. Our Relationship with Devon We entered into a long-term, strategic partnership with Devon in the Delaware Basin in 2023. In connection with that transaction, we and Devon entered into a long-term agreement pursuant to which Devon committed to us all of its produced water within a large AMI, including an initial dedication of approximately 52,000 acres, and contributed 18 produced water handling facilities with approximately 375,000 bpd of permitted capacity and approximately 210 miles of produced water pipelines for gathering, transportation, disposal and reuse in exchange for an equity interest in our predecessor. For the six months ended June 30, 2025, Devon was one of our largest customers by volume and accounted for approximately $49.4 million of our pro forma water-related revenues, which represented approximately 14% of our total pro forma water-related revenues for the year. Following the WaterBridge Combination and our Corporate Reorganization, Devon will own 17,692,370 Class B shares, representing 15.5% of our common shares, and an approximate 15.5% interest in OpCo. Competitive Strengths Our business has a number of competitive strengths, including the following: Extensive, Difficult-to-Replicate, Strategically Located Water Infrastructure Network. We operate the largest produced water infrastructure network in the United States, with a network of pipelines, produced water handling facilities and other infrastructure assets predominantly located in the prolific Delaware Basin. Our extensive asset base, consisting of, as of August 31, 2025 (on a pro forma basis), approximately 2,500 miles of pipeline, 197 produced water handling facilities and more than 4.5 million bpd of produced water handling capacity, positions us to efficiently gather, transport, recycle and handle produced water across approximately 2.3 million acres currently dedicated to our infrastructure network. Our extensive infrastructure network allows us to achieve economies of scale, reducing operational costs and enhancing the solutions we are able to offer to our customers. We believe that our infrastructure network is difficult to replicate given its scale and strategically Table of Contents advantaged location, which provide us with substantial opportunities for growth and enable us to increase the acreage dedicated to us and diversify our customer base. We provide a full suite of water handling and supply solutions to our customers and continue to explore ways to support their future growth. We believe that the further development of the Delaware Basin will be heavily dependent on the presence of an expansive and reliable water infrastructure network with sufficient access to underutilized pore space. Our network is critical to the operations of E&P producers in the Delaware Basin, without which we believe that the basin s expected continued growth trajectory would not be achievable. Access to Additional Pore Space Supporting New Disposal Capacity. We believe that the expected future growth of produced water volumes in the Delaware Basin will require access to additional, underutilized pore space. The strategic positioning of our water infrastructure network across the Delaware Basin, combined with our relationship with LandBridge, positions us to capture a large portion of these incremental volumes. Through our strategic relationship with LandBridge, we have access to approximately 240,000 acres in and around the Delaware Basin, including preferential access to approximately 150,000 acres. Additionally, our agreements with TPL provide us access to an approximately 64,000 acre AMI near and along the Texas-New Mexico state border in which TPL and LandBridge have granted us the right to operate produced water facilities. We believe that these areas are well-suited for new produced water handling capacity with significant, historically underutilized pore space at relatively shallower depths across a broad geographic area. Additionally, many areas with high drilling activity in the Delaware Basin are facing water saturation due to the filling of pore space with produced water volumes. Our existing rights to LandBridge s surface acreage and our agreements with TPL enable us to provide reliable access to underutilized pore space for produced water handling, which is a critical resource for producers in the Delaware Basin to sustain their operations. A significant portion of this pore space is located out-of-basin in the Central Basin Platform, away from existing production, drilling and injection locations, which we believe will provide further flow assurance for our customers. Furthermore, these surface areas are primarily located in Texas, which has proven to be a supportive regulatory and permitting environment for both water infrastructure and oil and natural gas development in general. As demand for effective, reliable water management increases, our ability to access areas capable of handling substantial volumes of produced water will further differentiate our business relative to our competitors. Cash Flow Generation through Long-Term, Fixed-Fee Contracts. Our business model is anchored by long-term, fixed-fee contracts, which include acreage dedications or MVCs, with leading E&P companies. As of June 30, 2025, our weighted average remaining long-term, fixed-fee contract life was approximately 11 years and included approximately 2.3 million acres dedicated to us. These long-term contracts are intended to generate predictable cash flows while enabling us to pursue growth opportunities and strengthen relationships with existing customers. We intend to enter into additional contracts as we expand our business and develop relationships with new customers. Our contracts are similar in structure to traditional crude gathering contracts found in the oil and gas midstream sector with clauses specifying acreage dedications, required services, delivery point(s), volumetric-based fees, stipulations on the method of measurement and limits on the ability to divert produced water volumes prior to being delivered to us. MVC and AMI provisions, which we utilize in addition to acreage dedications, are also common in oil and natural gas midstream contracts. Our customer contract profile is differentiated because of the length of our contracts. Approximately 69% of our long-term, fixed-fee customer contracts by revenue have an initial term of at least 15 years and approximately 92% of our long-term, fixed-fee customer contracts by revenue have an initial term of at least 10 years. Diversified Customer Base Comprised of Large, Well-Capitalized Producers. As a result of our strategically located water infrastructure network and commitment to operational excellence, we have entered into long-term agreements with numerous customers that are among the largest and most active producers in the Delaware Basin, including Permian Resources Corporation, Devon, Chevron Corporation, APA Corporation and Vital Energy, Inc. As of June 30, 2025, on a pro forma basis, we generated approximately 73% of our water-related revenues from well-capitalized, creditworthy customers rated BB- or higher. Our collaborative relationships with these producers underscore our commitment to fostering mutually beneficial relationships that drive growth, operational excellence and innovation in water management practices. For example, we have recently entered into commercial agreements with bpx energy, designed to support its Delaware Basin development, that include 10-year MVCs and provide us with a stable, long-term revenue stream. Moreover, our strategic partnership with Devon further enhanced our capabilities in the Delaware Basin by integrating Devon s extensive water Table of Contents infrastructure assets into our network and establishing a long-term commercial relationship with one of the most active and premier E&P companies in the region. We also have a diversified customer base. Our top five customers represented approximately 51% of our pro forma water-related revenues for the six months ended June 30, 2025, with our largest customer representing only approximately 18% of our pro forma water-related revenues for the six months ended June 30, 2025. Our diversified customer base helps to insulate our business from volatility in the drilling programs of individual customers and also provides us with visibility into multiple customers future drilling operations, which allows us to plan and forecast our business with a higher degree of confidence. High Quality, Built-for-Purpose Network with Exceptional Operational Track Record. We designed and constructed our water infrastructure network to leading industry standards, focusing on achieving exceptional asset quality and reliability. By employing comprehensive testing and management programs, we seek to enhance the safety, efficiency and performance of our assets. Our strategic investment in maintenance and asset integrity reduces ongoing capital requirements and increases long-term cash flow generation potential. Additionally, we developed our infrastructure network with operational redundancies that enable us to continue providing water management solutions to our customers even during maintenance activities, which provides our customers with assurance that we will handle their water management requirements reliably and consistently, further differentiating our flow assurance capabilities from our competitors. We have maintained an average operational up-time of 99.7% over the last two years, reducing bottlenecks for our customers. Our customers need around-the-clock, reliable water handling solutions to maximize the economic returns of their wells by avoiding interruptions in oil and natural gas production. Our network also has excess capacity that can accommodate additional produced water volumes. As a result, we expect to grow revenues and cash flow by transporting higher levels of produced water volumes on our current network without incurring significant incremental capital expenditures. Additionally, we have developed and implemented several fit-for-purpose technology solutions, including our proprietary WAVE produced water forecasting platform and state-of-the-art centralized operations center, which enable us to monitor, measure and forecast water volumes in real-time across our infrastructure network and further enhance our ability to provide flow assurance to our customers. We believe that our ability to swiftly respond to issues requiring remediation, along with our ability to forecast future system demands, is a competitive advantage that enables us to attract new customers and obtain additional business from existing customers. Experienced Management Team that Pioneered Large-Scale Water Infrastructure Development. Our management team is one of the most experienced in the water infrastructure sector, with a proven history of constructing and operating large-scale water infrastructure assets. Members of our management team have increased our produced water handling volumes, which currently comprises approximately 89% of our pro forma revenue, by approximately 134% since 2021. Additionally, our management team includes industry pioneers who have helped develop contract templates and operational best practices that are now standard in the industry. Our executive team includes members of the prior management teams of EnWater Solutions and Pelagic Water Systems, the precursor companies to certain of our Delaware Basin assets that were involved in pioneering the use of large-scale pipelines and other infrastructure for the management of produced water in the Delaware Basin. Our executives have an average of approximately eight years of experience at our predecessor companies, providing valuable institutional knowledge and continuity of operations. Additionally, our senior management team includes individuals with significant E&P and midstream experience, providing us with deep operational and commercial knowledge and resources.
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+As more fully discussed in Management Conflicts of interest, each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. The low price that our sponsor, executive officers and directors (directly or indirectly) paid for the founder shares creates an incentive whereby our officers and directors could potentially make a substantial profit even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. If we are unable to complete our initial business combination within the completion window, and do not hold a shareholder vote to amend our amended and restated memorandum and articles of association to extend the amount of time we will have to consummate an initial business combination, or by such earlier liquidation date as our board of directors may approve, the founder shares and private placement warrants may expire worthless, except to the extent they receive liquidating distributions from assets outside the trust account, which could create an incentive for our sponsor, executive officers and directors to complete a transaction even if we select an acquisition target that subsequently declines in value and is unprofitable for public shareholders. Further, each of our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors was included by a target business as a condition to any agreement with respect to our initial business combination. Additionally, we will reimburse an affiliate of our sponsor in an amount equal to $12,500 per month for office space, utilities and secretarial and administrative support made available to us, as described elsewhere in this prospectus. Upon consummation of this offering, we will repay up to $300,000 in loans made to us by our sponsor to cover offering-related and organizational expenses. In the event that following this offering we obtain working capital loans from our sponsor to finance transaction costs related to our initial business combination, up to $1,500,000 of such loans may be convertible into warrants of the post-business combination entity at a price of $1.00 per warrant at the option of our sponsor. As a result, there may be actual or potential material conflicts of interest between our sponsor and its affiliates on the one hand, and purchasers in this offering on the other hand. See the sections titled Summary Sponsor Information , Summary Conflicts of interest , Risk Factors Risks Relating to our Search for, and Consummation of or Inability to Consummate, a Business Combination Since our sponsor, officers and directors, any other holder of our founder shares may lose their entire investment in us if our initial business combination is not completed (other than with respect to public shares they may acquire during or after this offering), a conflict of interest may arise in determining whether a particular business combination target is appropriate for our initial business combination. and Management Conflicts of interest for more information. We have until the date that is 24 months from the closing of this offering or until such earlier liquidation date as our board of directors may approve, to consummate our initial business combination. If we anticipate that we may be unable to consummate our initial business combination within such 24-month period, we may seek shareholder approval to amend our amended and restated memorandum and articles of association to extend the date by which we must consummate our initial business combination. If we seek shareholder approval for an extension, holders of public shares will be offered an opportunity to redeem their shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (less taxes payable), divided by the number of then issued and outstanding public shares, subject to applicable law. If we are unable to complete our initial business combination within 24 months from the closing of this offering, or by such earlier liquidation date as our board of directors may approve, we will redeem 100% of the public shares at a per share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest earned thereon (less taxes payable and up to $100,000 of interest income to pay dissolution expenses), divided by the number of then issued and outstanding public shares, subject to applicable law as further described herein. Table of Contents Currently, there is no public market for our units, Class A ordinary shares or warrants. We intend to apply to have our units listed on The Nasdaq Global Market, or Nasdaq, under the symbol WENNU, on or promptly after the date of this prospectus. We cannot guarantee that our securities will be approved for listing on Nasdaq. We expect the Class A ordinary shares and warrants comprising the units to begin separate trading on the 52nd day following the date of this prospectus unless Cantor Fitzgerald & Co., the representative of the underwriters, informs us of its decision to allow earlier separate trading, subject to our satisfaction of certain conditions as described further herein. Once the securities comprising the units begin separate trading, we expect that the Class A ordinary shares and warrants will be listed on Nasdaq under the symbols WENN and WENNW , respectively. We are an emerging growth company and a smaller reporting company under applicable federal securities laws and will be subject to reduced public company reporting requirements. Investing in our securities involves a high degree of risk. See Risk Factors beginning on page 42 for a discussion of information that should be considered in connection with an investment in our securities. Investors will not be entitled to protections normally afforded to investors in Rule 419 blank check offerings. Neither the U.S. Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. No offer or invitation, whether directly or indirectly, is being or may be made to the public in the Cayman Islands to subscribe for any of our securities. Per Unit Total Public offering price(1) $ 10.00 $ 261,000,000 Underwriting discounts and commissions $ 0.65 $ 16,965,000 Proceeds, before expenses, to us $ 9.35 $ 244,035,000 ____________ (1) Includes $0.20 per unit (excluding any units sold pursuant to the underwriters option to purchase additional units), or $5,220,000 in the aggregate (whether or not the underwriters option to purchase additional units is exercised), payable to Cantor Fitzgerald & Co. upon the closing of this offering. Also includes $0.45 per unit on units other than those sold pursuant to the underwriters option to purchase additional units and $0.65 per unit on units sold pursuant to the underwriters option to purchase additional units, or $11,745,000 in the aggregate or up to $14,289,750 in the aggregate if the underwriters over-allotment option is exercised in full, payable to Cantor Fitzgerald & Co. for deferred underwriting commissions to be deposited into a trust account located in the United States and released to Cantor Fitzgerald & Co. for its own account only upon the completion of an initial business combination. See also Underwriting for a description of compensation and other items of value payable to the underwriters. Of the proceeds we receive from this offering and the sale of the private placement warrants described in this prospectus, $261,000,000, or $300,150,000 if the underwriters overallotment option is exercised in full ($10.00 per unit in either case), will be placed into a U.S.-based trust account with Continental Stock Transfer & Trust Company acting as trustee. The following table illustrates the difference between the public offering price per unit and our net tangible book value per share (NTBV), as adjusted to give effect to this offering and assuming the redemption of our public shares at varying levels and the exercise in full and no exercise of the over-allotment option. See section entitled Dilution for more information. Table of Contents As of February 7, 2025 Offering Price of $10.00 per Unit 25% of Maximum Redemption 50% of Maximum Redemption 75% of Maximum Redemption Maximum Redemption NTBV NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price NTBV Difference between NTBV and Offering Price Assuming Full Exercise of Over-Allotment Option $ 7.65 $ 7.07 $ 2.93 $ 6.09 $ 3.91 $ 4.13 $ 5.87 $ (1.74) $ 11.74 Assuming No Exercise of Over-Allotment Option $ 7.67 $ 7.08 $ 2.92 $ 6.11 $ 3.89 $ 4.17 $ 5.83 $ (1.67) $ 11.67 Our sponsor and members of our management team will, directly or indirectly, own our securities following this offering, and accordingly, they may have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination. Additionally, each of our officers and directors presently has, and any of them in the future may have additional, fiduciary, contractual or other obligations or duties to one or more other entities pursuant to which such officer or director is or will be required to present a business combination opportunity to such entities. As a result, there may be actual or potential material conflicts of interest between our sponsor and its affiliates on one hand, and purchasers in this offering on the other. See the sections titled Summary Conflicts of interest , Proposed Business Sourcing of Potential Business Combination Targets and Management Conflicts of Interest for more information. The underwriters are offering the units for sale on a firm commitment basis. The underwriters expect to deliver the units to the purchasers on or about , 2025. Sole Book-Running Manager Cantor , 2025 Table of Contents Table of Contents Page Summary 1
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diff --git a/parsed_sections/prospectus_summary/2025/WLTH_wealthfron_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/WLTH_wealthfron_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/XCBE_x3_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/XCBE_x3_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..4ecfda03912c7bc400468d0b47881890b7ed6a75
--- /dev/null
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@@ -0,0 +1 @@
+summary only highlights the more detailed information appearing elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read this entire prospectus carefully, including the information under "Risk Factors" and our financial statements and the related notes included elsewhere in this prospectus, before investing. Unless otherwise stated in this prospectus or the context otherwise requires, references to: "we," "us," "company" or "our company" are to X3 Acquisition Corp. Ltd., a Cayman Islands exempted company; "amended and restated memorandum and articles of association" are to the amended and restated memorandum and articles of association that the company will adopt prior to the consummation of this offering; "Stifel"
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diff --git a/parsed_sections/prospectus_summary/2025/XPON_expion360_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/XPON_expion360_prospectus_summary.txt
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index 0000000000000000000000000000000000000000..51c651997b5dc2e5a34a554a4310fa7686489b8c
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@@ -0,0 +1 @@
+PROSPECTUS SUMMARY This summary provides a brief overview of the key aspects of our business and our securities. The reader should read the entire prospectus carefully, especially the risks of investing in our securities discussed under the section of this prospectus titled Risk Factors. Some of the statements contained in this prospectus, including statements under this section and Risk Factors, are forward-looking statements and may involve a number of risks and uncertainties. Our actual results and future events may differ significantly based upon a number of factors. The reader should not put undue reliance on the forward-looking statements in this document, which speak only as of the date on the cover of this prospectus. See the section of this prospectus titled Cautionary Note Regarding Forward-Looking Statements. Overview Expion360 focuses on the design, assembly, manufacturing, and sale of lithium iron phosphate ( LiFePO4 ) batteries and supporting accessories for recreational vehicles ( RVs ), marine applications and home energy storage products with plans to expand into industrial applications. We design, assemble, and distribute high-powered, lithium battery solutions using ground-breaking concepts with a creative sales and marketing approach. We believe that our product offerings include some of the most dense and minimal-footprint batteries in the RV and marine industries. We are developing our e360 Home Energy Storage System, which we expect to change the industry in barrier price, flexibility, and integration. We are deploying multiple intellectual property strategies with research and products to sustain and scale the business. We currently have customers consisting of dealers, wholesalers, private label customers, and original equipment manufacturers who are driving revenue and brand awareness nationally. Our primary target markets are currently the RV and marine industries. We believe that we are well-positioned to capitalize on the rapid market conversion from lead-acid to lithium batteries as the primary method of power sourcing in these industries. We are also focused on expanding into the home energy storage market with the introduction of our two LiFePO4 battery storage solutions, where we aim to provide a cost-effective, low barrier of entry, flexible system for those looking to power their homes via solar energy, wind, or grid back-up. Along with RV, marine and home energy storage markets, we aim to provide additional capacities to the ever-expanding electric forklift and industrial material handling markets. Our e360 product line, which is manufactured for the RV and marine industries, was launched in December 2020. The e360 product line, through its sales growth, has shown to be a preferred conversion solution for lead-acid batteries. In December 2023, we announced our entrance into the home energy storge market with our introduction of two LiFePO4 battery storage solutions that enable residential and small business customers to create their own stable micro-energy grid and lessen the impact of increasing power fluctuations and outages. As of January 2025, we have begun shipping orders of our e360 Home Energy Storage Solutions. Our products provide numerous advantages for various industries that are looking to migrate to lithium-based energy storage. They incorporate detailed-oriented design and engineering and strong case materials and internal and structural layouts and are backed by responsive customer service. Recent Developments Certain Preliminary Financial Results for the Three Months Ended December 31, 2024 Although we have not finalized our full financial results for the three months and year ended December 31, 2024, we expect to report preliminary financial information as follows: Preliminary, unaudited revenue for the three months ended December 31, 2024 in the range of approximately $1.8 to $2.0 million, up sequentially from $1.4 million in the three months ended December 31, 2023. Preliminary, unaudited gross profit for the three months ended December 31, 2024 is expected to be in the range of approximately $350,000 to $450,000, compared to gross profit of $205,000 in the prior year period. Preliminary, unaudited net loss for the three months ended December 31, 2024 is expected to be in the range of approximately $450,000 to $350,000, compared to a net loss of $2.2 million in the prior year period as we continued to invest in new product development and launches. Preliminary, unaudited net loss from operations for the three months ended December 31, 2024 is expected to be in the range of approximately $1.3 to $1.2 million. 1 Net loss from operations reflects our net loss for the three months ended December 31, 2024 less approximately $5.8 million in a change in fair value of the Series A Warrants and Series B Warrants (each as defined below) we issued in the three months ended September 30, 2024, offset by a $5.0 million Reverse Stock Split Cash True-Up Payment (as defined below) contingent liability arising in connection with the warrant issuance, the aggregate of which resulted in a gain in net income of approximately $887,000. The information above is based on preliminary unaudited information and estimates for the three months and year ended December 31, 2024, is not a comprehensive statement of our financial results for this period, and is subject to change pending completion of our financial closing procedures, final adjustments, completion of the review of our financial statements and other developments that may arise between now and the time the review of our financial statements is completed. This preliminary estimate may change and the change may be material. Our expectation with respect to the preliminary financial information as of December 31, 2024 presented above is based upon management s estimates and is the responsibility of management. Our independent registered public accounting firm has not conducted an audit or review of, and does not express an opinion or any other form of assurance with respect to, these preliminary estimates. Our actual results for the three months and year ended December 31, 2024 will not be available until after this offering is completed. See August 2024 Financing and Subsequent Warrant Exercises and Adjustments to Warrant Exercise and Reset Prices and Reverse Stock Split and Reverse Stock Split True-Up Payment below for more information regarding the Series A Warrants and Series B Warrants and Reverse Stock Split True-Up Payment, respectively. Resignation of Chief Financial Officer and Appointment of Interim Chief Financial Officer On December 16, 2024, Greg Aydelott, our Chief Financial Officer, notified us of his resignation effective December 31, 2024, due to family health concerns. Mr. Aydelott is remaining with the Company in a consulting role on an ongoing basis. In connection with Mr. Aydelott s resignation, on December 20, 2024, our Board of Directors (our Board ) appointed Brian Schaffner, who currently serves as our Chief Executive Officer and as a member of the Board, to serve as our interim Chief Financial Officer effective immediately upon Mr. Aydelott s resignation. Chief Operating Officer Medical Leave of Absence Effective November 16, 2024, Paul Shoun, our Co-Founder, President, Chief Operating Officer, and Chairman of the Board, commenced a temporary medical leave of absence from his duties as Chief Operating Officer. Mr. Shoun is continuing to perform his duties as President and Chairman of the Board during his leave. We anticipate that Mr. Shoun will resume his responsibilities as Chief Operating Officer in February 2025. During his absence, Carson Heagen, our Vice President of Operations, is temporarily assuming the duties of Chief Operating Officer. Reverse Stock Split and Reverse Stock Split True-Up Payment Effective as of 5:00 p.m. Pacific Time on October 8, 2024 (the Effective Date ), we effected a 1-for-100 reverse stock split of our Common Stock (the Reverse Stock Split ), which was approved by the Board on September 27, 2024, following stockholder approval at our annual meeting of stockholders held on September 27, 2024. No fractional shares of Common Stock were issued as a result of the Reverse Stock Split and instead each holder of Common Stock who was otherwise entitled to receive a fractional share as a result of the Reverse Stock Split received one whole share of Common Stock in lieu of such fractional share. As a result of this, 210,668 shares were issued on or before October 17, 2024. In addition, the Reverse Stock Split effected a reduction in the number of shares issuable pursuant to our equity awards, warrants and non-plan options outstanding as of the Effective Date, and a corresponding increase in the respective exercise prices, conversion prices, reset prices and the like thereunder. As a result of the daily volume weighted average price ( VWAP ) of the Common Stock during the five trading days before and after the Reverse Stock Split, a Reverse Stock Split cash true-up payment provision in the Series A Warrants, which is capped at $5.0 million in the aggregate under all Series A Warrants (the Reverse Stock Split Cash True-Up Payment ), was triggered, but the payment of the Reverse Stock Split cash true-up payment was suspended in accordance with the terms of the Series A Warrants. However, in connection with the closing of this offering, we intend to use $500,000 of the net proceeds from the offering to satisfy a portion of certain amounts owed to the holders of the Series A Warrants pursuant to the terms thereof. 2 Except for our audited financial statements and the related notes for the fiscal years ended December 31, 2023 and December 31, 2022, which have not been adjusted on a retroactive basis to reflect the Reverse Stock Split, or as otherwise noted, all of our historical share and per share information related to issued and outstanding Common Stock and outstanding options and warrants exercisable for Common Stock in this prospectus have been adjusted, on a retroactive basis, to reflect the Reverse Stock Split. August 2024 Public Offering and Subsequent Warrant Exercises and Adjustments to Warrant Exercise and Reset Prices On August 8, 2024, we sold in a public offering (the August 2024 Public Offering ) (i) 33,402,000 common units (the Common Units, pre-Reverse Stock Split), each consisting of one share of Common Stock, two Series A warrants each to purchase one share of Common Stock (pre-Reverse Stock Split and pre-Adjustment (as defined below) and each, a Series A Warrant ) and one Series B warrant to purchase such number of shares of Common Stock as determined in the Series B warrant (each, a Series B Warrant ), and (ii) 16,598,000 pre-funded units (the Pre-Funded Units, and together with the Common Units, the Units, pre-Reverse Stock Split), each consisting of one pre-funded warrant to purchase one share of Common Stock (each, an August 2024 Pre-Funded Warrant ), two Series A Warrants, and one Series B Warrant, through Aegis Capital Corp. serving as underwriter (in its capacity as such, the Underwriter ). The Common Units were sold at a price of $0.20 per unit and the August 2024 Pre-Funded Warrants were sold at a price of $0.199 per unit (pre-Reverse Stock Split). In addition, we granted the Underwriter a 45-day option to purchase additional shares of Common Stock and/or August 2024 Pre-Funded Warrants and/or Series A Warrants and/or Series B Warrants, representing up to 15% of the number of the respective securities sold in the August 2024 Public Offering, solely to cover over-allotments, if any. The Underwriter partially exercised its over-allotment option with respect to 15,000,000 Series A Warrants and 7,500,000 Series B Warrants (pre-Reverse Stock Split). The August 2024 Pre-Funded Warrants were immediately exercisable at an exercise price of $0.001 per share (pre-Reverse Stock Split) and could be exercised at any time until exercised in full. All August 2024 Pre-Funded Warrants have been exercised. Each Series A Warrant is exercisable at any time or times beginning on September 30, 2024, which was the first trading day following our notice to the Series A Warrant holders of stockholder approval received at the 2024 Annual Meeting, and will expire five years from such date. Each Series A Warrant was initially exercisable at an exercise price of $24.00 per share of common stock (post-Reverse Stock Split). The exercise price of the Series A Warrants was subject to reduction on the 11th trading day after the stockholder approval to the greater of the lowest daily VWAP during the ten-trading-day period following the stockholder approval and the floor price of $5.206 (representing 20% of the lower of our Common Stock s closing price on Nasdaq on the date that we priced the August 2024 Public Offering, post-Reverse Stock Split) or our Common Stock s average closing price on Nasdaq for the five trading days ending on such date (such lower price, without giving effect to such 20% reduction, the Nasdaq Minimum Price ), and the number of shares issuable upon exercise would be proportionately adjusted such that the aggregate exercise price would remain unchanged. As of September 30, 2024, there would have been 5,301,592 shares of Common Stock (post-Reverse Stock Split and assuming the Adjustment had occurred on September 30, 2024) issuable upon exercise of the Series A Warrants as of that date. Subsequent to September 30, 2024, the exercise price under the Series A Warrants was reduced to the floor price of $5.206 (representing 20% of the Nasdaq Minimum Price, post-Reverse Stock Split), beginning on October 14, 2024, the 11th trading day following stockholder approval (the Series A Warrant Adjustment ). As of December 31, 2024, 14,900 shares of Common Stock have been issued upon exercise of Series A Warrants and 5,286,692 shares of Common Stock remain issuable upon exercise of Series A Warrants. Each Series B Warrant was exercisable immediately upon issuance at an exercise price of $0.10 per share (post-Reverse Stock Split). The number of shares of Common Stock issuable under the Series B Warrants were subject to adjustment using a reset price based on the weighted average price of common stock over a rolling five-trading-day period between the issuance date of the Class B Warrants and the close of trading on the tenth trading day following stockholder approval, subject to certain floor prices. As of September 30, 2024, 342,588 shares of Common Stock (post-Reverse Stock Split) had been issued upon exercise of Series B Warrants and there were 1,032,198 shares of Common Stock (post-Reverse Stock Split) issuable upon exercise of Series B Warrants based on the reset price of $5.45 (representing the lowest arithmetic average of the daily VWAP during the five-trading-day period from September 12, 2024 through September 18, 2024). Effective October 8, 2024, after market close, the Reverse Stock Split occurred and as of December 31, 2024, 87,384 shares of Common Stock remain issuable upon exercise of Series B Warrants using the reset price, which was reduced to the floor price of $5.206 (representing 20% of the Nasdaq Minimum Price (post-Reverse Stock Split) (such adjustment of the Series B Warrants, together with the Series A Warrant Adjustment, the Adjustment ). 3 Risk Factor Summary Before you invest in our Common Stock, you should carefully consider all of the information in this prospectus, including matters set forth under the section of this prospectus titled Risk Factors. These risks include, but are not limited to, the following: We operate in an extremely competitive industry and are subject to pricing pressures. We have a history of losses. As our costs increase, we may not be able to generate sufficient revenue to achieve and sustain profitability. Our audited financial statements include a statement that there is a substantial doubt about our ability to continue as a going concern and a continuation of negative financial trends could result in our inability to continue as a going concern. We have substantial customer concentration, with a limited number of customers accounting for a substantial portion of our sales in 2023 and 2022. Nearly all of our raw materials enter the United States through a limited number of ports and we rely on third parties to store and ship some of our inventory; labor unrest at these ports or other product deliver difficulties could interfere with our distribution plans and reduce our revenue. Increases in costs, disruption of supply or shortage of any of our battery components, such as electronic and mechanical parts, or raw materials used in the production of such parts could harm our business. currently, and will likely continue to be, dependent on our two warehouse facilities. If our facilities become inoperable for any reason, our ability to produce our products could be negatively impacted. Our failure to introduce new products and product enhancements and broad market acceptance of new technologies introduced by our competitors could adversely affect our business. We may not be able to adequately protect our proprietary intellectual property and technology and we may need to defend ourselves against intellectual property infringement claims. If our electronic data is compromised or if we fail to keep pace with developments in technology, our business could be significantly harmed. Our ability to raise capital in the future may be limited, which could make us unable to fund our capital requirements and sustain our operations. We depend on our senior management team and other key employees, and significant attrition within our management team or unsuccessful succession planning could adversely affect our business. Investors who buy shares at different times will likely pay different prices. Sales of substantial amounts of our securities in the public markets, or the perception that such sales might occur, could reduce the price of our securities and may dilute your voting power and your ownership interest in us. 4 The selling stockholders may choose to sell the Common Warrant Shares at prices below the current market price. You may experience future dilution as a result of issuance of the Common Warrant Shares, future equity offerings by us and other issuances of our Common Stock or other securities. In addition, the issuance of the Common Warrant Shares and future equity offerings and other issuances of our Common Stock or other securities may adversely affect our Common Stock price. Implications of Being an Emerging Growth Company and a Smaller Reporting Company We are an emerging growth company, as defined in the JOBS Act. As such, we are eligible for exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies, including, but not limited to, presenting only two years of audited financial statements in addition to any required unaudited interim financial statements with correspondingly reduced Management s Discussion and Analysis of Financial Condition and Results of Operations disclosure in this prospectus, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act ), reduced disclosure obligations regarding executive compensation and an exemption from the requirements to obtain a non-binding advisory vote on executive compensation or golden parachute arrangements. In addition, an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. This provision allows an emerging growth company to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. We have elected to avail ourselves of this provision of the JOBS Act. As a result, we will not be subject to new or revised accounting standards at the same time as other public companies that are not emerging growth companies. Therefore, our consolidated financial statements may not be comparable to those of companies that comply with new or revised accounting pronouncements as of their public company effective dates. We will remain an emerging growth company until the earliest of: (i) the last day of the fiscal year following the fifth anniversary of the consummation of our initial public offering; (ii) the last day of the fiscal year in which we have total annual gross revenue of at least $1.235 billion (as adjusted for inflation from time to time pursuant to SEC rules); (iii) the last day of the fiscal year in which we are deemed to be a large accelerated filer as defined in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the Exchange Act ), which would occur if the market value of our Common Stock held by non-affiliates were at least $700.0 million as of the last business day of the second fiscal quarter of such year; or (iv) the date on which we have issued more than $1.0 billion in non-convertible debt securities during the prior three-year period. We are also a smaller reporting company as defined in the Exchange Act. We may continue to be a smaller reporting company even after we are no longer an emerging growth company. We may take advantage of certain of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for so long as our public float is less than $250.0 million measured on the last business day of our second fiscal quarter, or our annual revenue is less than $100.0 million during the most recently completed fiscal year and our public float is less than $700.0 million measured on the last business day of our second fiscal quarter. Even after we no longer qualify as an emerging growth company, we may still qualify as a smaller reporting company, which would allow us to take advantage of many of the same exemptions from disclosure requirements, such as reduced disclosure regarding executive compensation, among others. For certain risks related to our status as an emerging growth company, see Risk Factors Risks Related to Ownership of our Common Stock We are an emerging growth company and elect to comply with certain reduced reporting requirements applicable to emerging growth companies, which could make our securities less attractive to investors. Channels For Disclosure of Information We announce material information to the public through filings with the SEC, the investor relations page on our website (expion360.com), press releases, public conference calls, and public webcasts. We encourage investors, the media and others to follow the channels listed above and to review the information disclosed through such channels. Any updates to the list of disclosure channels through which we will announce information will be posted on the investor relations page on our website. The inclusion of our website address in this prospectus is an inactive textual reference only. Corporate Information Expion360 was initially organized as a limited liability company under the name Yozamp Products Company, LLC in the State of Oregon on June 16, 2016, and converted to a Nevada corporation under its current name pursuant to articles of conversion dated as of November 16, 2021. Our principal executive offices are located at 2025 SW Deerhound Ave, Redmond, Oregon 97756 and our phone number is (541) 797-6714. Our principal website is expion360.com. The information contained on, or that can be accessed through, our website is not a part of this prospectus or the Registration Statement of which it forms a part. The inclusion of our website address in this prospectus is an inactive textual reference only. Investors should not rely on any such information in deciding whether to purchase our Common Stock. 5
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diff --git a/parsed_sections/prospectus_summary/2025/XRP_bitwise_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/XRP_bitwise_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..103885ac3c7c7349774a8a0faf49cbae1050de4e
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/XRP_bitwise_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary 1 Risk Factors 9 XRP, XRP MARKET AND REGULATION OF XRP 62 THE TRUST AND XRP PRICES 70 Calculation of NAV 76 ADDITIONAL INFORMATION ABOUT THE TRUST 78 The Trust s Service Providers 83 Custody of the Trust s Assets 85 THE PRIME EXECUTION AGENT AND the TRADE CREDIT LENDER 87 Form of Shares 93 Transfer of Shares 94 SEED CAPITAL INVESTOR 94 Plan of Distribution 94 Creation and Redemption of Shares 96 Use of Proceeds 102 OWNERSHIP OR BENEFICIAL INTEREST IN THE TRUST 102 Conflicts of Interest 102 FIDUCIARY AND REGULATORY DUTIES AND OBLIGATIONS OF THE SPONSOR 103 Liability and Indemnification 105 Provisions of Law 106 Management; Voting by Shareholders 107 Meetings 107 Books and Records 108 STATEMENTS, FILINGS, AND REPORTS TO SHAREHOLDERS 108 Fiscal Year 108 GOVERNING LAW; CONSENT TO DELAWARE JURISDICTION 108 Legal Matters 108 Experts 109 Material Contracts 109 UNITED STATES FEDERAL INCOME TAX CONSEQUENCES 115 Purchases By Employee Benefit Plans 120 Information You Should Know 122 SUMMARY OF PROMOTIONAL AND SALES MATERIAL 122 Intellectual Property 122 Where You Can Find More Information 123 Privacy Policy 123 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM F-1 Statement of ASSETS AND LIABILITIES F-2 This Prospectus contains information you should consider when making an investment decision about the Shares. You may rely on the information contained in this Prospectus. The Trust and the Sponsor have not authorized any person to provide you with different information and, if anyone provides you with different or inconsistent information, you should not rely on it. This Prospectus is not an offer to sell the Shares in any jurisdiction where the offer or sale of the Shares is not permitted. The Shares are not registered for public sale in any jurisdiction other than the United States. Until _____________, 2025 (25 days after the date of this prospectus), all dealers effecting transactions in the Shares, whether or not participating in this distribution, may be required to deliver a prospectus. This requirement is in addition to the obligations of dealers to deliver a prospectus when acting as underwriters and with respect to unsold allotments or subscriptions. The Sponsor first intends to use this prospectus on _____________, 2025. i STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This Prospectus includes "forward-looking statements" that generally relate to future events or future performance. In some cases, you can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential," or the negative of these terms or other comparable terminology. All statements (other than statements of historical fact) included in this Prospectus that address activities, events, or developments that will or may occur in the future, including such matters as movements in the digital asset markets, the Trust s operations, the Sponsor s plans, and references to the Trust s future success and other similar matters, are forward-looking statements. These statements are only predictions. Actual events or results may differ materially. These statements are based upon certain assumptions and analyses the Sponsor has made based on its perception of historical trends, current conditions, and expected future developments, as well as other factors appropriate in the circumstances. Whether or not actual results and developments will conform to the Sponsor s expectations and predictions is subject to a number of risks and uncertainties, including: the special considerations discussed in this Prospectus; general economic, market and business conditions; technology developments regarding the use of XRP and other digital assets, including the systems used by the Sponsor and the Trust s custodian in their provision of services to the Trust; changes in laws or regulations, including those concerning taxes, made by governmental authorities or regulatory bodies; and other world economic and political developments, including, without limitation, global pandemics and the societal and government responses thereto. See
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diff --git a/parsed_sections/prospectus_summary/2025/XRTX_xortx_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/XRTX_xortx_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/XRTX_xortx_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/YOUL_youlife_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/YOUL_youlife_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..502b203c37a13cc84b254d33efa7be75d3fcc494
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/YOUL_youlife_prospectus_summary.txt
@@ -0,0 +1 @@
+Prospectus Summary — Implication of Being a Company with the Holding Company Structure — Cash and asset flows through our organization." We are in the process of adopting our formal cash management policies which will dictate the purpose, amount and procedure of cash transfers among our holding company and subsidiaries. We will determine the payment of dividends and fund transfer based on our specific business needs in accordance with the applicable laws and regulations. See "Prospectus Summary — Implication of Being a Company with the Holding Company Structure — Dividend distribution and taxation." Cash may be transferred within the group in the following manner: (1) we may transfer funds to our subsidiaries by way of equity investments or intercompany loans, and (2) our subsidiaries may make dividends or other distributions to us. As of the date of this prospectus, except that (1) in 2021, cash in the form of equity investments in the amount of US$135.4 million was transferred from Youlife International Holdings Limited ("Youlife") to its Hong Kong Subsidiaries, and cash in the form of equity investments in the amount of US$71.5 million was transferred from the Hong Kong Subsidiaries to Shanghai Youerlan, (2) in 2021, 2022, 2023 and 2024, cash in the form of intercompany loans in the amount of US$30.0 million, US$3.0 million, US$1.7 million and nil was transferred from Youlife to Youlife Technologies, and (3) in 2022, 2023 and 2024, cash in the form of intercompany loans in the amount of US$30.0 million, US$4.5 million and US$0.6 million was transferred from Youlife Technology to Shanghai Youerlan, respectively, no other transfers, dividends or distributions have been made among us and our subsidiaries, or to investors; and no other cash flows and transfers of other assets by type have occurred among us and our subsidiaries. As of the date of this prospectus, none of us and our subsidiaries has paid any dividends or made any distributions to their respective shareholder(s), including U.S. investors if any, nor do we have any present plan to pay any cash dividends on our ADSs in the foreseeable future. We currently do not maintain any cash management policies that specifically dictate how funds may be transferred throughout our organization and investors. Rather, funds can be transferred within the group based on the specific business needs and in accordance with the applicable laws and regulations of mainland China. See "Summary of the Prospectus — Cash Flows through the Organization" for more details. On February 17, 2023, the CSRC promulgated Trial Administrative Measures of the Overseas Securities Offering and Listing by Domestic Companies (the "Overseas Listing Trial Measures") and circulated five supporting guidelines, which became effective on March 31, 2023. The Overseas Listing Trial Measures regulate both direct and indirect overseas offering and listing of PRC domestic companies securities by adopting a filing-based regulatory regime. We completed the filing procedures in connection with the business combination with Distoken (the "Business Combination") under the Overseas Listing Trial Measures on February 6, 2025, and the result of such CSRC approval was posted on the official website of the CSRC on the same date. We are not required to complete the CSRC filing procedures and obtain the CSRC approval under the Overseas Listing Trial Measures in connection with the resale of Registered Securities as described in this prospectus, because the resale of Registered Securities, including the ADSs issuable from the exercise of Warrants, does not trigger the obligation to apply for the CSRC filing procedures and obtain the CSRC approval. Pursuant to the Overseas Listing Trial Measures, we may need to complete filing procedures for future offshore fund-raising activities, including conducting follow-on offering in the United States. Any failure or perceived failure by us to comply with such filing requirements under the Overseas Listing Trial Measures may result in forced rectification, warnings and fines against us and could materially hinder our ability to raise fund overseas. In addition, we cannot guarantee that new rules or regulations promulgated in the future will not impose any additional requirement or otherwise tightening the regulations on companies with contractual arrangements. If we violate or are deemed to have violated any current or future rules or regulations, regulatory agencies in China may impose fines and penalties on our operations in China, limit our operating privileges in China, delay or restrict the repatriation of the proceeds from offshore fund-raising activities into the PRC or take other actions that could materially adversely affect our business, financial condition and results of operations, as well as the trading price of our ADSs. See "Summary of the Prospectus — Regulatory Matters" and "Risk Factors — Risks Relating to Doing Business in China — The approval of and filing with the CSRC or other PRC government authorities is required in connection with this Business Combination or our listing under laws of the PRC." To the extent our cash or assets in the business are in mainland China or Hong Kong or a mainland China or Hong Kong subsidiary, the funds or assets may not be available to fund operations or for other use outside of mainland China or Hong Kong due to interventions in or the imposition of restrictions and limitations on the ability of the Company and our subsidiaries to transfer cash or assets. The PRC government imposes certain restrictions on the convertibility of RMB into foreign currencies and the remittance of funds out of China, which may restrict the transfer of cash between the Company and our PRC subsidiaries or the investors. Under PRC laws and regulations, our PRC subsidiaries are subject to certain restrictions with respect to payment of dividends or otherwise transfers of any of their net assets to us. Remittance of dividends by our PRC subsidiaries out of China is also subject to certain procedures with the banks designated by the PRC State Administration of Foreign Exchange. These restrictions are benchmarked against the paid-up capital and the statutory reserve funds of our PRC subsidiaries. In addition, while there are currently no such restrictions on foreign exchange and our ability to transfer cash or assets between the Company and our Hong Kong Subsidiaries, if certain PRC laws and regulations, including existing laws and regulations and those enacted or promulgated in the future were to become applicable to our Hong Kong Subsidiaries in the future, and to the extent our cash or assets are in Hong Kong or a Hong Kong entity, such funds or assets may not be available due to interventions in or the imposition of restrictions and limitations on our ability to transfer funds or assets by the PRC government. Furthermore, we cannot assure you that the PRC government will not intervene or impose restrictions on the Company and our PRC subsidiaries to transfer or distribute cash within the organization, which could result in an inability of or prohibition on making transfers or distributions to entities outside of mainland China and Hong Kong. For details, see "Prospectus Summary — Implication of Being a Company with the Holding Company Structure — Cash and asset flows through our organization," "Risk Factors — Risks Relating to Doing Business in China — We may rely on dividends and other distributions on equity paid by our PRC Subsidiaries to fund any cash and financing requirements we may have, and any limitation on the ability of our PRC Subsidiaries to make payments to us could have a material and adverse effect on our ability to conduct our business," and "Risk Factors — Risks Relating to Doing Business in China — Governmental control of currency conversion may limit our ability to utilize our revenues effectively." We are an "emerging growth company" as that term is used in the Jumpstart Our Business Startups Act of 2012, as amended, and, as such, may elect to comply with certain reduced public company reporting requirements in future reports. We are a foreign private issuer within the meaning of the rules under the Exchange Act, and as such we are exempt from certain provisions of the securities rules and regulations in the United States that are applicable to U.S. domestic issuers, such as the rules regulating solicitation of proxies and certain insider reporting and short-swing profit rules. Moreover, the information we are required to file with or furnish to the SEC will be less extensive and less timely compared to that required to be filed with the SEC by U.S. domestic issuers. In addition, as a company incorporated in the Cayman Islands, we are permitted to adopt certain home country practices in relation to corporate governance matters that differ significantly from the corporate governance standards of the Nasdaq Stock Market. Investing in our securities involves a high degree of risk. See "Risk Factors" beginning on page 14 of this prospectus and other risk factors contained in the documents incorporated by reference herein for a discussion of information that should be considered in connection with an investment in our securities. Neither the U.S. Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. PROSPECTUS DATED , 2025 TABLE OF CONTENTS Page ABOUT THIS PROSPECTUS ii FINANCIAL STATEMENT PRESENTATION iii INDUSTRY AND MARKET DATA iv FREQUENTLY USED TERMS v FORWARD-LOOKING STATEMENTS xi SUMMARY OF THE PROSPECTUS 1
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diff --git a/parsed_sections/prospectus_summary/2025/ZBAI_atif_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/ZBAI_atif_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..2dfd9a983891522e2ad5c30c6facd0a755c4f1ad
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/ZBAI_atif_prospectus_summary.txt
@@ -0,0 +1 @@
+PROSPECTUS SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/ZDAN_zerolimit_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/ZDAN_zerolimit_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..c0a6a8772d614329fb15f7c058f65049242693cf
--- /dev/null
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@@ -0,0 +1 @@
+II-1 On February 19, 2024, the Company s authorized share capital is $50,000 divided into 500,000,000 Ordinary Shares, par value $0.0001 per share. As of the date of this prospectus, there are 50,000,000 Ordinary Shares issued and outstanding as below: Securities/Purchaser Number of Ordinary Shares Zerolimit Digital Technology Limited 36,505,000 Zerolimit Excellence Limited 5,500,000 Zerolimit Power Limited 5,500,000 Zerolimit Virtue Limited 2,495,000 Total 50,000,000 ITEM 8. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES. (a) Exhibits The exhibit index of this draft registration statement (b) Financial Statement Schedules Schedules have been omitted because the information required to be set forth therein is not applicable or is shown in the Consolidated Financial Statements or the Notes thereto. ITEM 9. UNDERTAKINGS. The undersigned registrant hereby undertakes to provide to the Underwriter at the closing specified in the underwriting agreement, certificates in such denominations and registered in such names as required by the Underwriter to permit prompt delivery to each purchaser. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the provisions described in Item 6, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. The undersigned registrant hereby undertakes that: (1) for purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective; and (2) for the purpose of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. The undersigned registrant hereby undertakes to file a post-effective amendment to the registration statement to include any financial statements required by Item 8.A of Form 20-F at the start of any delayed offering or throughout a continuous offering. II-2 For the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: (1)any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; (2)the portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and (3)any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. II-3 EXHIBIT INDEX Exhibit Number Description of Document 1.1 Form of Underwriting Agreement 3.1 Memorandum and Articles of Association 3.2 Form of Amended and Restated Memorandum and Articles of Association (to be effective in connection with the completion of this offering) 4.1 [Reserved] 4.2 Form of Underwriter s Warrants (included in Exhibit 1.1) 5.1 Opinion of Ogier regarding the validity of the Ordinary Shares being registered 10.1 Form of Director Offer Letter by and between executive officers and the Registrant 10.2 Offer Letter by and between Shaomei Zhang and the Registrant 10.3 Offer Letter by and between Xiaohsa Hu and the Registrant 10.4 Offer Letter by and between Oliver Yucheng Chen and the Registrant 10.5 Form of Sales Contract 10.6 Powers of Attorney executed by each VIE shareholder, accepted by WFOE and acknowledged by the VIE dated May 24, 2023 10.7 Equity Interest Pledge Agreement by and among WFOE, the VIE and the VIE shareholder dated May 24, 2023 10.8 Spousal Consent granted by the spouse of each individual shareholder of the VIE, as currently in effect 10.9 Exclusive Consulting and Services Agreement by and between WFOE and the VIE dated May 24, 2023 10.10 Exclusive Option Agreement by and among WFOE, the VIE and the VIE shareholder dated May 24, 2023 10.11 Software Authorization Agreement by and among the VIE and Zerolimit Digital dated March 1, 2024 10.12 Trademark Authorization Agreement by and among the VIE and ZeroLimit Digital Technology Co., Ltd. dated January 1, 2024 II-4 10.13 Master Sales Agreement between the VIE and Guangdong Lightning Cat New Energy Technology Co., Ltd 10.14 Master Sales Agreement between the VIE and Chongqing Shenghong Technology Co., Ltd 10.15 Master Sales Agreement between the VIE and Shenzhen Huawang Supply Chain Co., Ltd 10.16 Internet Data Center
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diff --git a/parsed_sections/prospectus_summary/2025/ZEOWW_zeo_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/ZEOWW_zeo_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..f0715161371ea74dbd7d3710379fe48f6ff739d2
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/ZEOWW_zeo_prospectus_summary.txt
@@ -0,0 +1 @@
+As filed with the Securities and Exchange Commission on October 28, 2025 Registration No. 333-[ ] UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM S-1 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ZEO ENERGY CORP. (Exact name of registrant as specified in its charter) Delaware 4931 001-40927 (State or other jurisdiction of incorporation or organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification Number) 7625 Little Rd, Suite 200A New Port Richey, FL 34654 (727) 375-9375 (Address, including zip code, and telephone number, including area code, of registrant s principal executive offices) Timothy Bridgewater, Chief Executive Officer 7625 Little Rd, Suite 200A New Port Richey, FL 34654 (727) 375-9375 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copies to: Stuart Neuhauser, Esq. Scott Miller, Esq. Ellenoff Grossman & Schole LLP 1345 Avenue of the Americas New York, NY 10105 Tel: (212) 370-1300 Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement. If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of large accelerated filer, accelerated filer, smaller reporting company and emerging growth company in Rule 12b-2 of the Exchange Act. Large accelerated filer: Accelerated filer: Non-accelerated filer: Smaller reporting company: Emerging growth company: If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. Rule 429 Statement Pursuant to Rule 429 under the Securities Act, the prospectus contained in this Registration Statement on Form S-1 (referred to herein as the Registration Statement) will be used as a combined prospectus in connection with this Registration Statement and the registrant s Registration Statement on Form S-4 (File No. 333-274551) that was originally declared effective by the Securities and Exchange Commission on February 13, 2024 (as amended, the S-4 ) and Registration Statement on Form S-1 (File No. 333- 278769) that was originally declared effective by the Securities and Exchange Commission on May 31, 2024 (as amended, the Prior S-1 ). Accordingly, this Registration Statement also constitutes Post-Effective Amendment No. 3 on Form S-4 to the S-4 and Post-Effective Amendment No. 4 on Form S-1 to the Prior S-1. Such Post-Effective Amendments will become effective concurrently with the effectiveness of this Registration Statement accordance with Section 8(c) of the Securities Act. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. EXPLANATORY NOTE Zeo Energy Corp., a Delaware corporation (the Company ), initially filed the Prior S-1 with the Securities and Exchange Commission ( SEC ) on April 17, 2024, as amended on May 23, 2024, which was declared effective by the SEC on May 31, 2024 and subsequently amended by Post-Effective Amendment No. 1 to the Registration Statement on S-1 filed with SEC on September 27, 2024, and declared effective by the SEC on October 1, 2024 ( Post-Effective Amendment No. 1 to the Prior S-1 ), which was then amended by Post-Effective Amendment No. 2 to the Registration Statement on Form S-1 filed with the SEC on February 7, 2025, and declared effective by the SEC on February 11, 2025 ( Post-Effective Amendment No. 2 to Prior S-1 ), then further amended by Post-Effective Amendment No. 3 to the Registration Statement on Form S-1 filed with the SEC on July 22, 2025, and declared effective by the SEC on July 29, 2025 ( Post Effective Amendment No. 3 to Prior S-1 ), and which was supplemented by a Prospectus Supplement filed with the SEC on August 21, 2025. together with the Prior S-1, Post-Effective Amendment No. 1, Post Effective Amendment No. 2 and Post-Effective Amendment No. 3, the Prior S-1, as Amended and Supplemented ). The Company had previously filed a registration statement on Form S-4 (File No. 333-274551) that was originally declared effective by SEC on February 13, 2024 (as amended, the S-4 ). Pursuant to Rule 429 under the Securities Act the prospectus included in this registration statement is a combined prospectus and also relates to all the securities registered for resale and remaining unsold under the Prior S-1, as Amended and Supplemented. Accordingly, this registration statement, which is a new registration statement also constitutes Post-Effective Amendment No. 4 to the Prior S-1, as Amended and Supplemented and Supplemented and Post-Effective Amendment No. 3 to the S-4, which shall hereafter become effective concurrently with the effectiveness of this registration statement. Consequently, the prospectus in this registration statement is a combined prospectus for (i) 40,118,434 shares of Class A Common Stock remaining for resale under the Prior S-1, as Amended and Supplemented; (ii) 1,851,851 shares of Class A Common Stock issued to LHX (as defined below) as partial repayment of the Lumio Promissory Note (as defined below), (iii) 677,711 shares of Class A Common Stock issued to Piper Sandler, and (iv) 8,080,000 shares of Class A Common Stock issued to LHX as compensation for the Lumio Assets. The Company previously paid a registration fee of $31,206.20 in connection with the filing of the Prior S-1, as Amended and Supplemented. The Company is paying concurrently herewith the registration fee of $2,827.80 in connection with the registration of 10,609,562 shares of Common Stock. The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. Subject to Completion Preliminary Prospectus dated October 28, 2025. Zeo Energy Corp. 50,727,996 Shares of Class A Common This prospectus also relates to the resale from time to time by the selling securityholders (including their transferees, donees, pledgees and other successors-in-interest) named in this prospectus (the selling securityholders ) of up to 50,727,996 shares of Class A Common Stock, which includes: 1,851,851 shares of Class A Common Stock issued to LHX as partial repayment of the Lumio Promissory Note (as defined below). The shares were issued pursuant to the terms of the Lumio Promissory Note, in satisfaction of $2.5 million of the total outstanding principal amount at a $1.35 per share conversion price; 677,711 shares of Class A Common Stock issued to Piper Sandler & Co. ( Piper Sandler ) at an equity consideration value of $2.49 per share, 50% of which will be subject to lock up as described below; 8,080,000 shares of Class A Common Stock issued to LHX as compensation for the Lumio Assets. 4,000,004 outstanding shares of Class A Common Stock issued to the Sponsor and certain former holders of ESGEN Class B ordinary shares, issued to such holders at an equity consideration value of $10.00 per share; 50,000 outstanding shares of Class A Common Stock issued to Piper Sandler & Co. at an equity consideration value of $5.00 per share; 1,838,430 shares of Class A Common Stock issuable upon exchange of an equivalent number of Convertible OpCo Preferred Units and Class V Common Stock issued to the Sponsor pursuant to the Sponsor Subscription Agreement at an equity consideration value of $10.00 per share; 33,730,000 shares of Class A Common Stock issuable upon exchange of an equivalent number of Exchangeable OpCo Units and Class V Common Stock issued to the Sellers pursuant to the Business Combination Agreement at an equity consideration value of $10.00 per share; and 500,000 shares of Class A Common Stock issuable to Sun Managers, LLC upon potential forfeiture of an equivalent number of shares of Class A Common Stock previously issued to Sponsor and certain former holders of ESGEN Class B ordinary shares at an equity consideration value of $10.00 per share. The selling securityholders can sell, under this prospectus, up to 50,727,996 shares of our Class A Common Stock, constituting more than 92% of our outstanding shares of Common Stock as of September 30, 2025, based on 55,000,369 shares of Class A Common Stock issued and outstanding and assuming the conversion of all 24,480,000 shares of Class V Common Stock issued and outstanding into 24,480,000 shares of Class A Common Stock. Sales of a substantial number of our shares of Class A Common Stock in the public market by the selling securityholders and/or by our other existing securityholders, or the perception that those sales might occur, could increase the volatility of and cause a significant decline in the market price of our securities and could impair our ability to raise capital through the sale of additional equity securities. See Risk Factors Sales of a substantial number of our securities in the public market by the selling securityholders and/or by our existing securityholders could cause the price of our shares of Class A Common Stock and Warrants to fall. All the securities offered in this prospectus by the selling securityholders may be resold for so long as the registration statement, of which this prospectus forms a part, is available for use. The sale of all or a portion of the securities being offered in this prospectus could result in a significant decline in the public trading price of our securities. Despite such a decline in the public trading price, some of the selling securityholders may still experience a positive rate of return on the securities they purchased due to the price at which such selling securityholder initially purchased the securities. We are registering the securities for resale pursuant to the selling securityholders registration rights under certain agreements between us, on the one hand, and the selling securityholders, on the other hand. Our registration of the securities covered by this prospectus does not mean that the selling securityholders will offer or sell any of the securities registered for resale. We are not selling any shares of Class A Common Stock under this prospectus and will not receive any of the proceeds from the sale or other disposition of the shares of Class A Common Stock by the selling shareholders. We will bear all costs, expenses, and fees in connection with the registration of the shares of Class A Common Stock. The selling securityholders may offer, sell or distribute all or a portion of their shares of Class A Common Stock publicly or through private transactions at prevailing market prices or at negotiated prices. The selling securityholders will bear all commissions and discounts, if any, attributable to their respective sales of the shares of Class A Common Stock. We provide more information about how the selling securityholders may sell the shares of Class A Common Stock in the section titled Plan of Distribution. Our shares of Class A Common Stock and Warrants are listed on the Nasdaq Stock Market LLC ( Nasdaq ) under the symbols ZEO and ZEOWW respectively. On September 30, 2025, the closing price of our Class A Common Stock was $1.35 per share and the closing price for our Warrants was $0.055 per warrant. We are an emerging growth company and a smaller reporting company under the federal securities laws and will be subject to reduced disclosure and public reporting requirements. See Summary Emerging Growth Company and Summary Smaller Reporting Company. Investing in shares of our securities involves risks that are described in the Risk Factors section beginning on page 10 of this prospectus. Neither the U.S. Securities and Exchange Commission (the SEC ) nor any state securities commission has approved or disapproved of the securities to be issued under this prospectus or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense. The date of this prospectus is , 2025. TABLE OF CONTENTS Page ABOUT THIS PROSPECTUS ii INDUSTRY AND MARKET DATA iii TRADEMARKS iii FREQUENTLY USED TERMS AND BASIS OF PRESENTATION iv CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS ix SUMMARY 1
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diff --git a/parsed_sections/prospectus_summary/2025/ZVSA_zyversa_prospectus_summary.txt b/parsed_sections/prospectus_summary/2025/ZVSA_zyversa_prospectus_summary.txt
new file mode 100644
index 0000000000000000000000000000000000000000..bbdd714700cce0472721127bf2700fedb74f095e
--- /dev/null
+++ b/parsed_sections/prospectus_summary/2025/ZVSA_zyversa_prospectus_summary.txt
@@ -0,0 +1,509 @@
+PROSPECTUS
+SUMMARY
+
+ 
+
+This
+summary highlights selected information from this prospectus and may not contain all of the information that is important to you in making
+an investment decision. Before investing in our securities, you should carefully read this entire prospectus, including all documents
+incorporated by reference. In particular, attention should be directed to our "Risk Factors" section in this prospectus and
+under similar captions in the documents incorporated by reference into this prospectus, including any prospectus supplement incorporated
+by reference hereto, and the financial statements and related notes thereto contained herein or otherwise incorporated by reference hereto.
+See also the section titled "Where You Can Find More Information." Unless expressly indicated or the context requires otherwise,
+the terms the "Company," the "Registrant," "we," "us" and "our" in this prospectus
+refer to ZyVersa (and the business of Old ZyVersa, which became the business of ZyVersa after giving effect to the Business Combination).
+
+ 
+
+Overview
+
+ 
+
+We
+are a clinical stage biopharmaceutical company leveraging proprietary technologies to develop drugs for patients with chronic renal or
+inflammatory diseases with high unmet medical needs. Our mission is to develop drugs that optimize health outcomes and improve patients 
+quality of life.
+
+ 
+
+We
+have two proprietary globally licensed drug development platforms, each of which was discovered by research scientists at the University
+of Miami, Miller School of Medicine (the "University of Miami" or "University"). These development platforms
+are:
+
+ 
+
+ 
+ 
+ 
+ Cholesterol
+ Efflux Mediator VAR 200 (2-hydroxypropyl-beta-cyclodextrin or "2HP CD") is an injectable drug
+ in clinical development for treatment of renal diseases. VAR 200 was licensed from L&F Research LLC on December 15, 2015. L&F
+ Research was founded by the University of Miami research scientists who discovered the use of VAR 200 for renal diseases.
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ Inflammasome
+ ASC Inhibitor IC 100 is a humanized monoclonal antibody in preclinical development for treatment of inflammatory conditions. IC 100
+ was licensed from InflamaCore, LLC on April 18, 2019. InflamaCore, LLC was founded by the University of Miami research scientists
+ who invented IC 100.
+
+ 
+ 
+
+We
+believe that each of our product candidates has the potential to treat numerous indications in their respective therapeutic areas. Our
+strategy is to focus on indication expansion to maximize commercial potential.
+
+ 
+
+Our
+renal pipeline is initially focused on rare, chronic glomerular diseases. Our lead indication for VAR 200 is focal segmental glomerulosclerosis
+("FSGS"). On January 21, 2020, we filed an Investigational New Drug application ("IND") for VAR 200, and the
+United States Food and Drug Administration ("FDA") has allowed our development plans to proceed to a Phase 2a trial in patients
+with FSGS based on the risk/benefit profile of the active ingredient (2HP CD). Prior to initiating a Phase 2a trial in patients
+with FSGS, we have initiated a small open-label Phase 2a trial in patients with diabetic kidney disease in which we expect to
+obtain patient proof-of-concept data more quickly than in an FSGS trial. This will enable assessment of drug effects as patients proceed
+through treatment and will provide insights for developing a larger Phase 2a/b protocol in patients with FSGS. VAR 200 has pharmacologic
+proof-of-concept data in animal models representative of FSGS, Alport Syndrome, and diabetic kidney disease providing opportunity for
+indication expansion.
+
+ 
+
+Our
+Inflammasome ASC Inhibitor IC 100 focuses on chronic inflammatory diseases. Our lead indication for IC 100 is obesity with cardiometabolic
+complications. IC 100 s preclinical development is nearing completion. Our focus is on advancing IC 100 toward a currently planned
+IND submission in H2-2025, followed by initiation of a Phase 1 trial in healthy overweight patients with a BMI between 27 – 30.
+IC 100 has preclinical data in animal models representing six different indications, each demonstrating that IC 100 attenuates pathogenic
+inflammasome signaling pathways leading to reduced inflammation and improved histopathological and/or functional outcomes. Those indications
+are stroke-related cardiovascular injury, retinopathy of prematurity ("ROP"), multiple sclerosis ("MS") acute
+respiratory distress syndrome ("ARDS"), spinal cord injury, and traumatic brain injury (TBI). Likewise, preclinical studies
+are underway in Alzheimer s and Parkinson s diseases, and we are preparing to initiate an IND-enabling preclinical study
+in an animal model of diet-induced obesity.
+
+ 
+
+Recent
+Developments
+
+ 
+
+The
+Inducement Transaction
+
+ 
+
+On
+July 9, 2025, we consummated the transactions contemplated under the Inducement Letter. Pursuant to the terms of the Inducement Letter,
+the Selling Stockholder party to such transactions exercised for cash Series A-2 Common Stock purchase warrants, as amended (the "Series
+A-2 Warrants"), and Series A-3 Common Stock purchase warrants (the "Series A-3 Warrants") for an aggregate of 3,062,465
+shares of Common Stock, and, as inducement to exercise the foregoing warrants, we issued the Series A-4 Warrants exercisable for 6,124,930
+Shares to such Selling Stockholder. The original exercise price for the Series A-2 and Series A-3 Warrants was $1.00 per share, which
+we reduced to $0.67 in accordance with the terms of the Inducement Letter. We received gross proceeds of approximately $2.05 million.
+A.G.P./Alliance Global Partners acted as our financial advisor in connection with the transactions described above for a cash fee of
+6.5% of the aggregate gross proceeds. See "The Inducement Transaction" elsewhere in this prospectus for further details.
+
+ 
+
+The
+Williamsburg Transaction
+
+ 
+
+On
+June 24, 2025, we entered into the Purchase Agreement with Williamsburg. The Purchase Agreement provides us with an equity line of credit,
+pursuant to which we have the right, but not the obligation, to sell to Williamsburg up to an aggregate of $10 million of Shares (the
+"EPA Shares") in a series of transactions. Subject to certain conditions, Williamsburg is obligated to purchase the EPA Shares
+under the terms of the Purchase Agreement to the extent we choose to sell such EPA Shares to it. We agreed to issue to Williamsburg shares
+of Common Stock (the "Commitment Shares") equal to approximately 2.5% of the EPA Shares that we sell to Williamsburg under
+the Purchase Agreement upon the consummation of each issuance of EPA Shares pursuant thereto. The Purchase Agreement s term is
+through the earlier of June 24, 2027, or the date on which Williamsburg shall have purchased EPA Shares up to the maximum amount established
+by the facility. See "The Williamsburg Transaction" elsewhere in this prospectus for further details.
+
+ 
+
+Nasdaq
+Delisting
+
+ 
+
+We
+previously disclosed of receiving a notice from the Nasdaq Listing Qualifications Department (the "Staff") of its determination
+to delist our securities due to our noncompliance with the minimum bid price requirements under Listing Rule 5550(a)(2). We had appealed
+the Staff s decision and requested an exception to complete the Company s compliance plan. On July 15, 2025, we received
+a determination letter (the "Delisting Letter") from Nasdaq indicating that the Nasdaq Hearings Panel (the "Panel")
+has determined to deny the Company s request to continue its listing on The Nasdaq Capital Market. The Delisting Letter provides
+that trading in our Common Stock on Nasdaq will be suspended at the open of trading on July 17, 2025. Our Common Stock is expected to
+begin trading on the Pink Limited Market maintained by the OTC Markets Group Inc. on or about July 17, 2025.
+
+ 
+
+Corporate
+Information
+
+ 
+
+On
+December 12, 2022 (the "Closing Date"), we consummated a business combination pursuant to the terms of that certain Business
+Combination Agreement, dated July 20, 2022, as amended from time to time (the "Business Combination Agreement"), by and among
+ZyVersa Therapeutics, Inc., a Florida corporation ("Old ZyVersa"), the representative of Old ZyVersa s shareholders
+named therein (the "Securityholder Representative"), Larkspur Health Acquisition Corp., a Delaware corporation ("Larkspur")
+and Larkspur Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of Larkspur (the "Merger Sub"). Pursuant
+to the terms of the Business Combination Agreement (and upon all other conditions of the Business Combination Agreement being satisfied
+or waived), on the Closing Date of the Business Combination and transactions contemplated thereby, (i) Larkspur changed its name to "ZyVersa
+Therapeutics, Inc.", a Delaware corporation and (ii) the Merger Sub merged with and into Old ZyVersa (the "Merger"),
+with Old ZyVersa as the surviving company in the Merger and, after giving effect to such Merger, Old ZyVersa became a wholly-owned subsidiary
+of the Company.
+
+ 
+
+Our
+principal executive offices are located at 2200 North Commerce Parkway, Suite 208, Weston, Florida 33326, and our telephone number is
+(754) 231-1688. Our website address is http://www.zyversa.com. The information contained on or otherwise accessible through our website
+is not part of this prospectus.
+
+ 
+
+ 
+
+ 3
+
+ 
+
+ 
+
+ 
+
+ 
+
+THE
+OFFERING
+
+ 
+
+The
+following summary contains basic information about this offering. The summary is not intended to be complete. You should read the full
+text and more specific details contained elsewhere in this prospectus and in the documents incorporated by reference herein.
+
+ 
+
+ 
+ Issuer:
+ 
+ ZyVersa
+ Therapeutics, Inc.
+
+ 
+ 
+ 
+ 
+
+ 
+ Common
+ Stock offered by the Selling Stockholders:
+ 
+ Up
+ to 23,624,938 Shares, comprised of up to (i) 17,073,179 EPA Shares that have been or may be issued to Williamsburg
+ pursuant to the Purchase Agreement, (ii) 426,829 Commitment Shares that have been or may be issued as consideration to Williamsburg
+ for entering into the Purchase Agreement, and (iii) 6,124,930 shares (the "Warrant Shares") of Common Stock issuable
+ upon exercise of the Series A-4 Warrants.
+
+ 
+ 
+ 
+ 
+
+ 
+ Offering
+ Price:
+ 
+ The
+ Selling Stockholders will sell the shares at prevailing market prices or privately negotiated prices.
+
+ 
+ 
+ 
+ 
+
+ 
+ Common
+ Stock outstanding immediately before this offering:
+ 
+ 7,935,921
+ shares of Common Stock.
+
+ 
+ 
+ 
+ 
+
+ 
+ Common
+ Stock to be outstanding after this offering:
+ 
+ 31,560,859
+ shares of Common Stock, assuming that the full amount available to us under the Purchase Agreement is sold and all Commitment Shares
+ and Warrant Shares are issued.
+
+ 
+ 
+ 
+ 
+
+ 
+ Use
+ of Proceeds:
+ 
+ The
+ Selling Stockholders will receive all of the proceeds from the sale of the Shares offered for sale by them under
+ this prospectus. We will not receive proceeds from the sale of the Shares by the Selling Stockholders. However, we
+ may receive aggregate gross proceeds of up to $10 million from the sale of our Common Stock under the Purchase Agreement and approximately
+ $4.1 million in net proceeds of all of Series A-4 Warrants are exercised for cash. Any proceeds from the Selling Stockholders
+ that we receive are expected to be used for working capital and other general corporate purposes. See
+ "Use of Proceeds."
+
+ 
+ 
+ 
+ 
+
+ 
+ Ticker
+ Symbol:
+ 
+ The
+ Common Stock previously traded on The Nasdaq Capital Market under the symbol "ZVSA." As of the
+ open of trading on July 17, 2025, trading in the Common Stock on Nasdaq has been suspended. The Common Stock continues to be traded
+ in the over-the-counter market under the symbol "ZVSA" and quoted on the Pink Limited Market. 
+
+ 
+ 
+ 
+ 
+
+ 
+ Risk
+ Factors:
+ 
+ See
+ "Risk Factors" and other information included in this prospectus and in the documents incorporated by reference
+ herein for a discussion of certain factors you should consider before investing in our securities.
+
+ 
+ 
+
+The
+number of shares of Common Stock to be outstanding after the offering is based on 7,935,921 shares of Common Stock outstanding
+as of June 30, 2025 and excludes, as of that date, the following:
+
+ 
+
+ 
+ 
+ 
+ 691
+ shares issuable upon the exercise of certain private placement warrants issued in connection with Larkspur s initial public
+ offering on December 23, 2021 ("IPO"), with a weighted-average exercise price of $4,025 per share;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 16,644
+ shares issuable upon the exercise of the public warrants issued to investors in connection with the IPO, with a weighted-average
+ exercise price of $4,025 per share;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 4,193
+ shares underlying warrants of Old ZyVersa, that we assumed, 3,651 of which are currently exercisable by holders of the Old ZyVersa
+ warrants and have a weighted-average exercise price of $2,415.10 per share, and 542 of which will become exercisable upon
+ our achievement of certain milestones;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 13,944
+ shares issuable upon the exercise of the private warrants sold along with the shares of Larkspur Series A Convertible Preferred Stock
+ (the "PIPE Shares") sold to certain PIPE investors, with a weighted-average exercise price of $700 per share;
+
+ 
+ 
+
+ 
+
+ 4
+
+ 
+
+ 
+
+ 
+
+ 
+
+ 
+ 
+ 
+ 31,489
+ shares underlying the PIPE Shares, with a weighted-average exercise price of $313.45 per share;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 16,027
+ shares issuable upon the exercise of the common stock purchase warrants that we issued in connection with a public offering that
+ we completed on July 26, 2023, with a weighted-average exercise price of $57.75 per share;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 20,347
+ shares issuable upon exercise of the new inducement warrants issued to existing warrant holders in September 2023, with a weighted-average
+ exercise price of $47.50 per share;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 4,050
+ shares issuable upon the exercise of the Series A common stock purchase warrants that we issued in connection with a public offering
+ that we completed on December 11, 2023, with a weighted-average exercise price of $12.50 per share;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 679,800
+ shares issuable upon the exercise of the Series A-2 common stock purchase warrants that we issued in connection with the inducement
+ offer that we completed on or about November 5, 2024, with a weighted average exercise price of $2.06 per share;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 4,979
+ shares issuable upon exercise of stock options issued pursuant to our 2014 Equity Incentive Plan, with a weighted-average exercise
+ price of $4,111.38 per share;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 4,157
+ shares issuable upon exercise of stock options issued pursuant to our 2022 Omnibus Equity Incentive Plan, with a weighted-average
+ exercise price of $152.46 per share;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 324
+ shares issuable upon exercise of stock options issued from inducement grants, with a weighted-average price of $744.66 per share;
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 72
+ shares issuable upon conversion of our Series A convertible preferred stock; and
+
+ 
+ 
+ 
+ 
+
+ 
+ 
+ 
+ 2,067
+ shares issuable upon conversion of our Series B convertible preferred stock.
+
+ 
+ 
+
+Unless
+expressly indicated or the context requires otherwise, all information in this prospectus assumes no issuance of Shares under the
+Purchase Agreement and no exercise of the Series A-4 Warrants offered hereby.
+
+ 
+
+ 
+
+ 5
+
+ 
+
+ 
+
+ 
+
+RISK
+FACTORS
+
+ 
+
+An
+investment in our securities involves a high degree of risk. You should carefully consider the risks described below and discussed under
+the section captioned "Risk Factors" contained in our Annual Report on Form 10-K for the year ended December 31, 2024, as
+updated by our subsequent filings under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), each of which
+is incorporated by reference in this prospectus in their entirety, before making an investment decision. If any of the risks described
+therein or below actually occur, our business, operating results, prospects, or financial condition could be materially and adversely
+affected. This could cause the trading price of our common stock to decline and you may lose all or part of your investment. The risks
+described below are not the only ones that we face. Additional risks not presently known to us or that we currently deem immaterial may
+also affect our business operations. Certain statements in "Risk Factors" are forward-looking statements. See "
\ No newline at end of file